August 10, 2016
Welcome to the weekly LNG market report issued by the Alaska Gasline Development Corporation. This report includes news articles that highlight market activities within the global LNG industry, as well as up-to-date metrics on Henry Hub and LNG import pricing. The weekly news blast is intended to provide relevant industry information to Alaskan stakeholders and inform audiences of the competitive landscape in the global LNG market. Subscription options for this report are available at the bottom of this email. Please contact Leah Levinton at llevinton@agdc.us with questions or suggestions.
Natural Gas
HH Spot Price
August 8 close
Weekly Change
$0.04  (1.4%) 
Source: DOR
LNG Import Price
July 2016
Monthly Change
$0.00  (0%) 
Source: World Bank
(Oil Price; August 8) - As China shifts toward cleaner energy sources, natural gas imports could jump to as much as 270 billion cubic meters annually by 2030. This is good news for the global gas industry after experiencing multi-year pricing lows and a saturated global LNG market. The Asian LNG market is depressed due to oversupply, but with China undertaking to cut harmful emissions by, among other measures, increasing the share of gas in its energy mix to 60 percent, things are set to change.
(Bloomberg; August 10) - The newly expanded Panama Canal has significant implications for LNG trade by reducing travel time and transportation costs for LNG shipments from the U.S. Gulf Coast to key markets in Asia and providing additional access to previously regionalized LNG markets. The canal's deeper channels can accommodate enormous LNG tankers, shaving 11 days and one-third the cost of the typical round trip to Asia. The expansion effort cost more than $5 billion and took nine years to construct.
(Reuters; August 5) - Eni, an Italian hydrocarbon company, reached a multi-billion dollar agreement with the ExxonMobil over the sale of a stake in the proposed onshore liquefied natural gas (LNG) facility in the northern Mozambican province of Cabo Delgado. Although sources have indicated that negotiations have been concluded, those sources indicated that the deal wouldn't be announced for several months "at Exxon's request."  
(Nikkei Asian Review; August 10) - Lower global LNG prices has created an increased interest for long-term contracts from Asian LNG buyers as they seek to take advantage of the current market price. Although these long-term contracts have established a foundation for growth of the LNG market in Asia, Asian LNG buyers have sought to renegotiate long-term LNG contracts to manage slow gas demand while maintaining LNG supply price competitiveness.