ICE TTF futures have held steady through mid-October, despite a brief decline from softened perceived geopolitical risk, with concerns over supply tightening as the Gazprom-Ukraine transit deal ends. Meanwhile, the Dec’24 Basis dropped from $0.70/MMBtu to $0.50/MMBtu before stabilising, with a cautious short-term outlook amid potential supply risks. Henry Hub futures have stabilised between $2.80 and $3/MMBtu, though bearish sentiment continues due to high inventories and lower-than-expected heating demand. EIA data shows US storage at 3,785 bcf as of mid-October, up 2.9% year-on-year, and warmer winter forecasts alongside increased production could pressure prices further.
It appears Western sanctions have led to the shutdown of Russia’s Arctic LNG 2 project, which halted production on October 11 after operating for less than three months since its last restart. The project has struggled to secure buyers, with over 1 million cubic meters of LNG still undelivered and stored on carriers and floating storage units. Satellite images show a noticeable reduction in flaring activity, confirming the production halt amid the ongoing challenges.
On October 24, U.S. federal regulators granted a 3-year extension to the ExxonMobil and Qatar Energy joint venture to complete the Golden Pass LNG plant. The delay stemmed from lead contractor Zachry Holdings’ bankruptcy filing in March, with the project now $2.4bn over budget. Located at Sabine Pass, Golden Pass is expected to be a key contributor to US LNG exports. Negotiations are ongoing with McDermott International to take over as the main contractor.
Securing Energy for Europe (SEFE) and ConocoPhillips have entered a 10-year natural gas agreement, with initial deliveries already completed. ConocoPhillips will supply up to 9Bcmof natural gas from its European portfolio to SEFE, helping balance SEFE’s annual demand of 20 billion cubic meters. This partnership supports SEFE’s goal of diversifying its natural gas portfolio and securing energy supply for Europe.
In Oct, Meyer Werft delivered Disney Treasure, the second LNG-powered cruise ship for Disney Cruise Line, ahead of schedule. The 144,000 GT ship, with 1,240 cabins and low-emission LNG propulsion, will set sail in December. Following the 2022 delivery of Disney Wish, a third ship, Disney Destiny, is expected in 2025. Meyer Werft is also set to build four more ships for Disney by 2031, and a Disney Wish-class vessel for Japan by 2029.
Thailand’s PTT PTT.BK is looking to purchase two LNG cargoes for December delivery, according to two industry sources. The tender, which closes on October 29, is for cargoes scheduled to arrive at the Map Ta Phut terminal in Rayong on December 4-5 and December 25-26.
