18 July 2013 12:21 [Source: ICIS news]
SINGAPORE (ICIS)--Australian oil and gas giant Woodside has cancelled shipments of two more liquefied natural gas (LNG) cargoes to China’s Guangdong Dapeng terminal this month because of its falling production, sources familiar with the issue said on Thursday.
The volume of the combined cargoes is about 130,000 tonnes, they said.
Woodside shut an LNG production train in Australia, the sources said without providing further details.
In April this year, the company also cancelled two cargoes to the same Chinese terminal, which is operated by China National Offshore Oil Corp (CNOOC).
CNOOC has informed its downstream clients of the supply loss, according to a source from a Guangdong-based power company.
As of July, Woodside has cancelled a total of 260,000 tonnes of term LNG supplies to China this year, accounting for about 8% of annual supply, ICIS data showed.
The supply reduction from Australia, however, is expected to have limited impact on the Guangdong gas market, industry sources said.
Some regions are sufficiently supplied by natural gas supplied via PetroChina’s second West-East gas pipeline, according to end-users.
Moreover, downstream consumers are not very keen to procure spot LNG cargoes from overseas in view of higher costs, the source from the Guangdong-based power firm said.
August spot LNG cargo loaded in China are currently at $15.63/MMBtu on a delivered ex-ship (DES) basis, while the price of Australian term cargoes was around $3/MMBtu, according to ICIS data.
($1 = €0.77)
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