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Market Watch 

Headline crude prices for the week beginning 17 June 2019 – Brent: US$61/b; WTI: US$52/b

  • Bear-ish trends continue for global oil prices, as more signs of a global economic and manufacturing slowdown emerge, sending crude benchmarks to their lowest levels in almost five months
  • With OPEC and its OPEC+ allies meeting in Vienna soon, it seems like a foregone conclusion that the global supply deal will be extended to December; in the absence of any surprises, the meeting is unlikely to move the needle on crude prices much
  • However, the market has been rattled by a long impasse between Iran, Saudi Arabia and Russia over the date of the upcoming meeting; originally scheduled for June 25-26, the meeting has now been postponed to July 1-2, but not after reports of internal squabbles that exposed the fragile balance in the group
  • While OPEC+ is putting up a united front beyond its internal tensions, it has named international trade tensions as a catalyst for hurting current demand for oil, causing it to slash its consumption forecast for the year by 20%
  • US manufacturing production and housing sentiment are the latest indicators to show unexpected slowdowns, joining warning signs from China and Germany that the global economy was under pressure, as US crude stockpiles swell
  • With China now slapping a 25% tariff on US LNG imports and President Donald Trump considering additional sanctions, the American Petroleum Institute has urged Trump to return to the negotiating table to avoid a ‘negative and long-term impact on American businesses’
  • Geopolitical tensions are also high, as the recent attack on a Norwegian and a Japanese oil tanker in the Persian Gulf keeps the threat of conflict very real
  • With all these factors in play, the US EIA has lowered its Brent price forecast for 2019 to US$67/b, down from its previous expectations of US$70/b, citing ‘rising uncertainty about global oil demand growth’; last month, the IEA slashed its growth forecast for oil demand slightly to 1.3 mmb/d
  • With prices under pressure, the active US rig count dropped by a net six last week, losing one oil and five gas sites, bringing the total count to 969 sites
  • Prevailing concerns over the health of oil demand and the global economy will keep crude prices on a lowered trajectory, although we do expect some improvement in global benchmarks to US$62-64/b for Brent and US$53-55/b for WTI

Headlines of the week

Upstream

  • Cuba is the latest Caribbean country aiming for upstream riches, launching its first offshore licensing round in London offering 24 blocks in northwest areas in the Gulf of Mexico, with Eni, Premier Oil and CNPC expressing interest
  • ExxonMobil is moving ahead with the Bajo del Choique-La Invernada block development in Argentina’s Vaca Muerta basin, which should produce output of 55,000 boe/d within five years with plans for a 75,000 b/d second phase
  • China’s CNOOC will be offering five offshore blocks in the Pearl River Mouth basin in the South China Sea to international investors as part of a seven-year plan to expand offshore exploration in China

Midstream & Downstream

  • Shell is selling off its Martinez refinery in California to American refining specialist PBF Energy for some US$1 billion, expanding the latter’s presence on the US West Coast after Shell’s repeated attempts to sell Martinez since 2015
  • PetroChina’s expansion of its Huabei refinery has been completed, doubling crude capacity to 200 kb/d along with a new hydrocracker and hydrotreater
  • Cameroon’s sole 42 kb/d Sonara refinery will be shut down for a year following a major fire, forcing the country to cover fuel demand through increased imports
  • ExxonMobil and Saudi Arabia’s SABIC will be proceeding with a 1.8 mtpa ethane steam cracker in San Patricio, Texas – the world’s largest steam cracker that will power a major petrochemicals complex using Permian output
  • Indonesia has begun testing of B30 biodiesel blends in a bid to introduce a new national mandate in 2020, reduce oil imports and boost palm oil consumption
  • Phillips 66 has formed two new joint ventures totalling US$4 billion to construct pipelines delivering crude from shale basins to market, teaming up with Plains All American Pipeline for the Red Oak system connecting the Permian/Cushing to coastal Texas facilities and Bridger Pipeline for the Liberty pipeline connecting the Rockies/Bakken to Cushing, Oklahoma

Natural Gas/LNG

  • Total has begun production at its Culzean gas condensate field in the UK North Sea’s Block 22/25a near Aberdeen, which should deliver some 100,000 boe/d of natural gas or some 5% of the UK’s gas consumption
  • Poland’s PGNiG has signed a new agreement with Venture Global LNG to purchase an additional 1.5 mtpa of LNG from the Plaquemines and Calcasieu Pass LNG export projects, bringing PGNiG’s total purchase commitments with Venture Global LNG to 3.5 mtpa over a period of 20 years
  • Swiss trader Gunvor has inked a deal with Commonwealth LNG in Louisiana to purchase 1.5 mtpa of LNG for 15 years when it starts up in 2024
  • The first shipment of LNG from Shell’s Prelude FLNG facility in Western Australia has sailed, completing the last of Australia’s mega-LNG projects
  • US President Donald Trump is looking to implement US sanctions to halt the construction of the Nord Stream 2 pipeline between Germany and Russia, potentially derailing the controversial project and boost US LNG sales
  • The Tango FLNG vessel in Argentina has completed commissioning and handed over to state firm YPF, delivering its first cargo in early June
  • Kinder Morgan has delayed the start-up of its Elba LNG terminal Georgia, USA again, with no new timeline set for the 2.5 mtpa liquefaction terminal
  • Austria’s OMV will acquire stakes in the Achimov IV and V developments in the West Siberia Urengoy gas field from Gazprom for some US$1 billion

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Your Weekly Update: 2 - 6 December 2019

Market Watch  

Headline crude prices for the week beginning 2 December 2019 – Brent: US$61/b; WTI: US$55/b

  • As the posturing begins ahead of the OPEC meeting in Vienna, crude oil prices mounted gains as several OPEC members signalled that the club was prepared to deepen cuts to the existing supply deal
  • Data showing that the Chinese manufacturing sector growth jumped unexpectedly in November, although the see-saw messages regarding a potential US-China trade deal continue to cloud the market… especially given recent US legislation to sanction China for its policies in Hong Kong and against its own Uighur community
  • The discussion in Vienna by the OPEC nations and the wider OPEC+ club revolved around adherence and implementation of the current supply deal, focusing on cajoling errant members – ie. Russia – into meeting their quotas, in exchange for a deeper cut to prop up prices
  • This resulted in a decision to cut output by a further 500,000 b/d in Q1 2020 – formalising the supply reductions already in place and subject to all members of OPEC+ implementing all of their pledged curbs; further details on the new plan are expected to be released
  • OPEC’s outlook on the crude market in 2020 has changed slightly, as it expects that the US shale revolution will slow down considerably in the next two years; however, it also warns of additional output coming from non-OPEC members, including Norway and Brazil, the latter being a possible new OPEC member
  • Meanwhile, in the US, the chronic decline in the active rig count continues, with the Baker Hughes index falling by a net 1 last week – the loss of 3 gas rigs offset by the gain of two gas rigs – the 13th decrease in the past 15 weeks, with the active count down 274 y-o-y
  • The decision spinning out of OPEC’s Vienna meeting is broadly positive – not a great shot in the arm, but not detrimental to the current market; as such we see crude prices trading in their current range of US$62-64/b for Brent and US$57-60/b for WTI


Headlines of the week

Upstream

  • Norway’s Equinor has announced that it will scale back exploration activities in frontier areas in the Barents Sea, shedding risk to focus on drilling near existing discoveries such as Johan Castberg and Wisting, and therefore decreasing the chance of discovering a new Arctic oil region
  • Cairn Energy will be exiting Norway as it sells its entire stake in Capricorn Norge AS to Solveig Gas Norway AS for US$100 million
  • Libya’s El Feel – a key field operated by Eni and Libya’s National Oil Corp near the giant Sharara field – has restarted production at 74,000 b/d after clashing between rival fighting factions forced it to shut down
  • Woodside’s development plan for Phase 1 of the offshore Sangomar field in Senegal – targeting production of 100,000 b/d via FPSO – has been submitted to the Senegalese government, paving the way for FID
  • Spurred on by success, ExxonMobil is adding a fifth drillship in Guyana as it probes a new ultra-deepwater prospect just north of the Stabroek block
  • Equatorial Guinea’s latest licensing round was a boon to Lukoil, which walked away with the prime EG-27 block containing the Fortuna gas discovery, while US player Vaalco Energy won 4 blocks in the onshore Rio Muni basin

Midstream/Downstream

  • Pertamina has purchased US crude for the first time in a long while, inking a shipment for 950,000 barrels of US WTI crude with Total to be delivered over 1H 2020 to the Cilacap refinery, pivoting away from Middle East grades
  • Trafigura is looking to sell off its fuel station network in Australia – operated through its retail arm Puma Energy – as continued losses in the space since it entered the market in 2013 for US$850 million pile up
  • Construction on BASF’s giant US$10 billion integrated petrochemicals project in Zhanjiang, Guangdong has begun, with the first phase to be launched in 2022 as the first wholly foreign-owned chemicals complex in China
  • Equatorial Guinea has announced plans to build two new oil refineries – each with a processing capacity of 30-40,000 b/d using local Zafiro crude – along with other projects including a methanol-to-gasoline plant and LNG expansion
  • Bosnia’s sole refinery – the 25,000 b/d Brod site – should be operational by mid-2020, following a major overhaul that began in January 2019

Natural Gas/LNG

  • Algerian piped natural gas exports to Europe have been squeezed out by boosted supply of LNG from Australia and the US, as well as piped gas from Russia, which has forced Sonatrach to turn more of its gas into LNG sold by spot
  • Gunvor has agreed to market LNG from the Commonwealth LNG project in Louisiana internationally, as well as double its own purchases from the project to as much as 3 million tpa once the project begins operations in 2024
  • Norway’s BW Offshore insist that its Kudu natural gas project in Namibia is ‘alive and well’, with talks ongoing with the government two years after the FPSO specialist acquired a 56% stake in the license from NAMCOR
  • ExxonMobil is reportedly looking to sell its 50% stake in the Neptun Deep gas project in the Black Sea offshore Romania – the location of its major Domino discovery – for some US$250 million as it continues on a major asset sale
  • Petronas is sending its second FLNG unit – the PFLNG Dua – to the Rotan gas field in Sabah, beginning liquefaction operations there by February
December, 06 2019
Global Small-Scale LNG Market to Reach 48.3 Million Tons per Annum by 2022 : Energy cost advantage & Environmental Benefits are Major Drivers

The Global Small-Scale LNG Market is projected to grow from 30.8 MTPA in 2016 to 48.3 MTPA by 2022, at a CAGR of 6.7% between 2017 and 2022. The small-scale LNG market across the globe is driven by their increasing LNG demand from remote locations by applications, such as industrial & power, and the ability to transport LNG over long distances without the need for heavy investment such as pipelines. By terminal type, regasification terminal is expected to grow at a highest CAGR between 2017 and 2022. The increasing demand for LNG from the remote locations and global commoditization of LNG are some of the major factors that are driving the demand for small-scale LNG in this segment.

Downlolad PDF Brochure @ https://www.marketsandmarkets.com/pdfdownloadNew.asp?id=226707057

The Linde Group (Germany), Wärtsilä (Finland), Honeywell International Inc. (U.S.), General Electric (U.S.), and Engie (France), among others are the leading companies operating in the small-scale LNG market. These companies are expected to account for significant shares of the small-scale LNG market in the near future.  

Critical questions the report answers:

Growth Drivers are : 

  • Energy cost advantage of LNG over alternate energy sources for end users
  • Environmental benefits
  • Fiscal regime and subsidies

small-scale-lng-market-226707057

Energy cost advantage of LNG over alternate energy sources for end-users

Heavy duty transport companies save approximately 30% on fuel costs on LNG-fueled trucks, compared to diesel fueled trucks, and produce 30% lower emissions. Air pollution from diesel engines is one of the biggest concerns, especially in areas that struggle to meet air-quality standards. On the other hand, natural gas causes complete combustion and fewer emissions than diesel. It is estimated that increasing environmental concerns from the utilization of diesel vehicles is likely to increase the adoption of green fuel technologies such as natural gas. In the case of electric power generation, natural gas engines below 150 KW are more cost effective than oil fueled engines. Fuel cost is one of the major cost for road transportation, which is strongly subject to excise taxation. Typically, an LNG-fueled Volvo FM truck can travel up to 600 km with LNG. With an additional 150 litres of diesel, it can travel up to 1,000 km without refuelling. Thus, reducing the cost of travel. With additional LNG liquefaction capacity expected to come online in the next few years, an oversupply of LNG is expected, which will drive the price of LNG further lower. Considering all these factors, both developed and developing countries are undertaking feasibility studies to recognize the techno-economics of shifting their economies from diesel to natural gas. Therefore, the cheap price of small-scla LNG over others alterantive fuels will drive the growth during the forecast period. 

Small-scale LNG terminals are regarded as facilities, including liquefaction and regasification terminals, with a capacity of less than 1 million tons per annum (MTPA) within the scope of this study. It includes the LNG produced from small-scale liquefaction terminals and regasified at small-scale regasification terminals for catering to applications such as LNG-fueled heavy-duty transport, LNG-fueled ships, and industrial & power generation. 

North America small-scale LNG market is projected to grow at the highest CAGR during the forecast period.

The North America small-scale LNG market is projected to grow at the highest CAGR during the forecast period. In North America, most of the small-scale LNG demand in industrial & power applications is met through peak shaving facilities. The peak shaving facilities are used to meet adequate supply of LNG to address the peak demand. In 2015, there were more than 100 peak shaving facilities in the U.S., among which one-half of the peak shaving facilities were located in the Northeast, while a quarter of them were located in the Midwest. Currently, the U.S. has among the highest number of peak shaving plants. However, less than 10% of them are available for any other use due to the current electricity demand. The commissioning of small-scale liquefaction plants can expand the peak shaving capacities in the region.

Speak to Analyst @ https://www.marketsandmarkets.com/speaktoanalystNew.asp?id=226707057

Major Market Developments: 

  • In December 2016, SkanGas AS signed an agreement with Statoil ASA, an oil and gas company in Norway for the reloading of small-scale LNG at Klaipeda LNG Terminal in Lithuania
  • In November 2016, Wärtsilä signed a Memorandum of Understanding (MoU) with ENGIE, a French multinational company to develop services and solutions in the small-scale LNG sector. The agreement includes LNG distribution in remote areas and islands, LNG for ships, small-scale LNG and bio-liquefaction, and LNG to power stations
  • In October 2016, GAZPROM announced to develop a program for a small-scale LNG production, which includes a list of gas distribution stations and liquefaction technologies for LNG production. The program involves the construction of mobile LNG filling stations and cryogenic filling facilities.
  • In June 2014, The Linde Group developed a small-scale LNG technology namely StarLNG™ for the integration into natural gas liquids (NGL) plants. Some of the benefits of this technology includes zero impact on the reliability of the NGL plant production and monetizing the stream of the residue gas through small-scale LNG.

Get 10% FREE Customization on this Study @ https://www.marketsandmarkets.com/requestCustomizationNew.asp?id=226707057

December, 05 2019
Cryogenic Tanks Market - Global Forecast to 2024

The report "Cryogenic Tanks Market by Raw Material (Steel, Nickel Alloy), Cryogenic Liquid (Liquid Nitrogen, LNG), Application (Storage, Transportation), End-use Industry (Metal Processing, Energy Generation, Electronics), and Region - Global Forecast to 2024" The global cryogenic tanks market size is projected to grow from USD 6.2 billion in 2019 and expected to reach USD 8.1 billion by 2024, at a CAGR of 5.5%.

Browse 121 market data Tables and 36 Figures spread through 147 Pages and in-depth TOC on "Cryogenic Tanks Market by Raw Material (Steel, Nickel Alloy), Cryogenic Liquid (Liquid Nitrogen, LNG), Application (Storage, Transportation), End-use Industry (Metal Processing, Energy Generation, Electronics), and Region - Global Forecast to 2024"
View detailed Table of Content here - https://www.marketsandmarkets.com/Market-Reports/cryogenic-tanks-market-26811967.html

The global industry for cryogenic tanks is driven primarily by the increasing demand for LNG. An increase in infrastructure spending, space applications for cryogenic technologies, and cryogenic energy storage systems represent promising growth opportunities for the market. Improving healthcare services in the developing economies is boosting the cryogenic tanks market.

The steel segment is estimated to lead the cryogenic tanks market, by raw material, during the forecast period.

Steel is primarily used in the manufacturing of cryogenic tanks. Most of the materials are ductile at room temperature and abruptly lose their ductility when a given threshold is exceeded. They then become brittle even at relatively low temperatures. The austenitic stainless steel is majorly used for working in the low-temperature range. Carbon and alloy grade steels used for low-temperature service are required to provide high strength, ductility, and toughness in vehicles, vessels, and structures that must be used at –49°F and lower. These factors are contributing to the growth in demand for steel for the manufacturing of cryogenic tanks.

Liquid Nitrogen is the fastest-growing cryogenic liquid segment of the cryogenic tanks market.

Liquid nitrogen is primarily used in metal processing, food & beverage, electronics, and healthcare industries. The steel manufacturing industry is one of the major consumers of nitrogen. Nitrogen is used in the food & beverage industry for food preservation and packaging applications. The use of liquid nitrogen in this industry enables cost savings during storage and transportation and improves food quality. Liquid nitrogen is used to cool normally soft or heat-sensitive materials, such as plastics, tires, and certain metals. The increasing demand for liquid nitrogen from metal processing, food, and medical industries is expected to drive the market in this segment.

Metal processing is expected to lead the end-use industry segment for cryogenic tanks market during the forecast period.

Metal-processing industry was the largest end-use industry for the cryogenic tanks industry. Cryogenic tanks are increasingly being used in the metal processing industry, especially steel the industry. Huge quantities of nitrogen and other industrial gases are used during the steel manufacturing process. Nitrogen is also known to be largest consumed gas in the industry. It is used as a high-pressure gas for laser cutting of steel and metal. The inert properties of nitrogen facilitates its use as a blanketing gas. Some gases, including hydrogen and oxygen, are also used in the metal processing industry.   Cryogenic tanks are commonly used in the storage and transportation of these gases in manufacturing plants, which drives the market demand.

High economic growth rate and growing metal processing and energy generation industries in China, Australia, and India are projected to lead the cryogenic tanks market in APAC during the forecast period.

APAC is the fastest-growing market, in terms of both production and demand. Higher domestic demand, easy availability of raw materials, and low-cost labor make APAC the most preferred destination for the manufacturers of cryogenic tanks. The cryogenic tanks market in India, China, and Australia is expected to witness significant growth during the forecast period. The market is primarily driven by the demand from the energy & power sector. APAC is emerging as a leading consumer of cryogenic tanks, owing to the increasing demand from domestic as well as international markets.

The key players in cryogenic tanks market are Chart Industries (US), Cryofab (US), INOX India (India), Linde PLC (UK), Air Products (US), Cryolor (France), Air Water (Japan), Wessington Cryogenics (UK), FIBA Technologies (US), and ISISAN (Turkey). These players have established a strong foothold in the market by adopting strategies, such as expansion, new product launch, and merger & acquisition.

Don’t miss out on business opportunities in Cryogenic Tanks Market. Speak to our analyst and gain crucial industry insights that will help your business grow.

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December, 05 2019