MILAN/LONDON: Asian liquefied natural gas (LNG) prices firmed this week as supply growth from new and existing producers continued to frustrate expectations.
Traders said that liquidity was thin in Asia this week with prices for June delivery at $4.65 per million British thermal units (mmBtu), compared with $4.55 per mmBtu last week.
Spot LNG prices for July delivery were seen at similar levels. "Some buyers in Asia may be willing to pay a premium to an end-June cargo," one trade source said. There were a few bright spots amid generally lacklustre demand.
Polish Oil and Gas Company's tender to buy five cargoes is to be awarded on Friday, with traders as far afield as Singapore following the outcome to discern its wider impact on prices. Korea Gas Corp was also due to have awarded its purchase tender for six cargoes this week, with two Asia-based traders citing talk that Qatar will supply some or all of the cargoes.
A source in Europe, however, said Kogas had pushed back the award date of the tender and that two companies have been shortlisted.
It was not possible to confirm details. Egypt is also expected to launch a tender for the supply of about 10 cargoes for delivery in the second half of the year.
Meanwhile, bid submissions for Argentina's tender to buy nine cargos are due on Tuesday, with an award expected the following day.
Output from Australia's Gorgon LNG project stalled after mechanical problems forced a shutdown, while Angola LNG remains offline and the start-up AP LNG's second production line in Australia is also running behind schedule.
Origin Energy, the operator of AP LNG, hired Macquarie Capital to advise on a potential spin-off of its gas production businesses, including the $25 billion LNG plant.
In the shipping sector, Golar LNG said that former Chief Executive Oscar Spieler would return to the top job as the natural gas shipping company pushes deeper into the Brazilian power generation market to cope with weakness in freight rates.
Meanwhile, as US LNG exports begin to ramp up and are increasingly expected to make landfall in Europe, French Energy Minister Segolene Royal is investigating legal means to ban imports.
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