Egypt LNG production unaffected

Producers at Egypt’s two export plants have told Reuters that production and loading of liquefied natural gas is unaffected by widespread civil unrest across the nation.

Reuters reported that cargo operations at the Alexandria and Damietta ports had come to a near standstill.

But BG Group, which produces about a third of Egypt’s gas and holds a stake in the Egypt LNG (ELNG) plant at Idku, told reporters its LNG operations were unaffected.

A spokeswoman for Gas Natural Fenosa, which operates the Damietta LNG export plant on the north coast, also said that operations were running as normal.

“The Damietta plant is working normally, if a ship wants to go and load up, it can,” the spokeswoman said, declining to comment on specific loadings.

Analysts and traders said the impact of supply disruptions on the wider market were tempered by Egypt’s dwindling role as an LNG exporter in recent years, as domestic demand for natural gas increased.

The primary destination for Egyptian LNG is Spain, according to Wood Mackenzie analysts.
Meanwhile, Reuters reported LNG traders and analysts are closely watching the situation in Egypt for any sign of supply disruptions.

But the real concern is that the Suez Canal, a key shipping route for LNG tankers, could be shut if unrest continues. So far, the canal has remained open.

Last year, 368 loaded LNG tankers moved through the Suez Canal, totaling about 13% of yearly LNG production, said Pan Eurasian analysts in a note.

Major European LNG importer Britain, whose gas price is very sensitive to changes in the LNG supply outlook, has six LNG tankers on the way from the Middle East. The tankers, expected over the next two weeks, would normally all go through the Suez Canal.

All of Belgium’s expected imports in the next two weeks are from Qatar, according to Reuters data, and would typically go through the canal.

(Source: upstreamonline)


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