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Inpex Ichthys Jetty 1
30 Mar
Ready for the Gas Battle? Will you win and reap the spoils?
 This week's post was written by Nicholas Harwood, a friend and colleague in professional services. I suspect the alarming drop in the oil price will impact much of the supply chain. This will only raise the stakes and complexity in the battle for efficiency and effectiveness, the imperative to remain relevant in a changing industry. This disruption comes on top of the looming transitions of our major projects from development to production, and the service requirements will dramatically change. 
oil price recovery
09 Feb
Where are Oil Prices Going? L-U-V-J
Where is the price of oil going? Oil markets exert such an influence on the price of LNG that oil markets are worth watching (LNG prices being a derivative of oil). Will the price of oil bounce back quickly or sometime in the distant future? How high will it go? And what will happen to LNG prices? Will they bounce back? What factors weigh most heavily on determining the shape of the price recovery? I'm no forecaster, but I do have a view about the future. Read on. 
March 2015
08 Dec
News and Analysis – November 2014
Here's my analysis of the LNG and natural gas industry news and analysis from the month of November, 2014. 

Oil Drags LNG To The Basement

Far and away the biggest story of the month was the buildup to the OPEC meeting on November 27 and the fall out afterwards. All month the Saudis were passing the word that they were going to push prices down so it was no surprise, really, if you were paying attention. It's the biggest price drop in 6 years, and with it, any gas (pipeline or LNG) that is priced with reference to oil also went down. Oil and gas stocks took a beating (70% of the value of a stock in this sector can be statistically explained by just two variables – the daily price of oil and the number of barrels of oil and gas in reserves). With cash flow crimped, the global industry will pull back and cancel or trim capital spending, defer selling anything until better times, with parallel impacts on services companies (demand contraction, idle equipment, pricing pressures). M&A activity will pick up as everyone in the sector is now revalued lower, and the best way executives can now reach their performance goals is to acquire something. The LNG sector is not immune to this phenomenon and there's lots of stories that Australia's LNG projects might get taken out. Expect to see transactions in the services sector (like this big one between Baker Hughes and Halliburton). For a few more predictions, have a look at this blog on the topic.
When the going gets tough, the best balance sheets go shopping! #LNG
March 2015
06 Oct
LNG News And Analysis – September 2014
Here's my analysis of the most interesting news from the world of LNG and natural gas from the period September 1-30, 2014. 

Feeling the Chill

As winter approaches, the pressure is ratcheting up on those European nations dependent on Russian gas supplies to get sorted. Gas shortages and high spot prices are on the menu as Greece gets around 70% of its gas needs from Russia, Bulgaria 100%, with Serbia, Hungary, Austria, Slovenia, Slovakia, Turkey and the Czech Republic also highly dependent. Perhaps it would be helpful to have Ukrainians pay market price for the gas that they consume. I was shocked to learn that a third of Ukrainian households pay US$2.40/month for unlimited gas consumption. With prices this low, for sure some Ukrainian households are overconsuming gas. Neighbouring countries (Hungary, Poland) have offered to ship gas to Ukraine, and are told by the EU that reshipping gas is legal under EU law, but contract restrictions, not to mention Russian annoyance (read retaliation), makes short work of any attempts to help out. So onto contingency planning via storage, FLNG supplies and industrial preparation. You can find an earlier blog about this story in my archives.
March 2015
18 Sep
News And Analysis – August 2014
Here's my analysis of the most interesting news about LNG and natural gas from the month of August, 2014 (drawn from my twitter feed @geoffreycann).

Gas, Australia and Market Impacts

The impacts of Australia's natural gas export projects continue to play out. Early in the month the Australia Industry Group issued a study (full disclosure: it was completed by my firm) on the impacts of high gas prices on sectors that use a lot of gas, including agriculture, mining and manufacturing, and it's not good news - these sectors will all experience considerable cost pressures that are hard to avoid, and will reduce country GDP by billions. A number of stakeholders have offered their views. On balance, the economy will be better off as gas exports drive investment and royalties.By capping gas development in Victoria and NSW, state governments have inadvertently given fresh impetus to a new pipeline project to move gas from the Northern Territory to gas hungry eastern markets. Media stories conveniently ignored the possibility that NT gas could end up in Gladstone for export, and that the pipeline would take years to reach fruition, long after the market will have adjusted to new gas prices. It would seem far easier and faster to change the rules to open up gas production.
March 2015
30 Jun
LNG News and Analysis June 1 – June 28, 2014

Here's my analysis of the most interesting news from the world of LNG and natural gas from the period June 1 to June 28, 2014.Russian Pipe Digs OnRussia is building a massive gas pipeline that bypasses its troubled neighbour, Ukraine, en route to European gas...

March 2015
16 Jun
LNG News and Analysis – May 4 – May 31

Here's my analysis of the most interesting news from the world of LNG and Natural Gas, for the period of May 3 to May 31, 2014.EPA Launches Hate-on for Coal.The EPA publishes its long-awaited set of rules for achieving an epic reduction in US...

LNG News and Analysis – Apr 19 – May 3, 2014

Here's my analysis of the news from the world of LNG from the period April 19 to May 3, 2014. Ukraine Crisis Drags On [caption id="attachment_271" align="alignleft" width="150"] Flag of Ukraine[/caption]In my earlier analysis of the Ukraine crisis, I didn't think gas markets would be unduly impacted....

Drawing of flag of Ukraine
31 Mar
Australian LNG and the Ukraine Crisis: What, me worry?

Wow! The global press has gone berserk over the crisis in the Ukraine. And at least a part of the story has been about the natural gas industry, specifically Russian gas supplies to Ukraine, the former heart of the Russian empire. How is this all...

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