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NIGERIA
The Nigeria Liquefied Natural Gas Limited (NLNG) and Total Gas & Power (TGP) have signed a Liquefied Natural Gas (LNG) Sale and Purchase Agreement (SPA) for some of the remarketed volumes from NLNG’s Trains 1, 2 and 3. The agreement is for the supply of 1.5 million tons per annum (mtpa) for a 10-year term on a Delivered Ex-ship and Free on Board (FOB) basis.
NLNG said the agreement is in line with its drive to continue to deliver LNG globally in the consolidation of its position as one of the top-ranking LNG suppliers in the world. The SPA with TGP advances the plans by NLNG to remarket volumes from three trains.
The SPA will boost the company’s global presence and market reach, in line with its corporate vision of being a “global LNG company, helping to build a better Nigeria”. The group managing director of the Nigerian National Petroleum Corporation (NNPC), Alhaji Mele Kyari, has revealed a syndicated approach which it is pursuing to help end pipeline vandalism in the country.
He explained that NNPC was collaborating with all security agencies in the country to curb the occurrences of pipeline vandalism across the country. He stated that as part of measures to mitigate the incidences of pipeline vandalism, NNPC planned to deplore Horizontal Directional Drilling Technology (HDDT) as a check on the unwholesome incidences.
The HDD technology would make it difficult for the vandals to vandalize the pipelines. Alhaji Kyari explained that the Honorable Minister of State for Petroleum Resources, Chief Timipre Sylva, was also engaging stakeholders to bring everybody on the table to address and arrest the situation, adding that even President Muhammadu Buhari had taken the matter up as he considered it a national urgency to guarantee energy security in the Country. WAF
SENEGAL
Limited has signed a binding Memorandum of Understanding (MoU) with Glencore Energy (UK) for the full allocation of the company’s share of crude oil from the Sangomar field. FAR has also provided an update to the development operations before the settlement of the placement shares scheduled for 23 January 2020.
The binding MoU between FAR and Glencore, which is subject to the negotiation of final documentation consistent with industry standards, provides FAR with access to the extensive marketing and offtake resources of one of the world’s leading marketers of crude oil.
FAR will benefit from Glencore’s global network and multi-decades expertise in the oil and gas landscape, including access to Glencore’s unprecedented track record in creating markets for new qualities of crudes, thereby maximizing the intrinsic value of the Sangomar barrels.
Provided Glencore remains a lender to FAR, the offtake is expected to be for 7 years following first oil with a minimum of 20 million barrels (representing FAR’s share of the project) expected to be produced during that time.
GLOBAL
On Thursday 23rd January, oil prices fell sharply to a two-month low extending recent weakness amid concerns the pneumonia-like virus in China could have a significant impact on the world’s largest importer’s demand for crude.
The U.S. West Texas Intermediate (WTI) crude futures were down 2.9% at $55.08 a barrel at 9:30 AM ET (14:30 GMT), while Brent crude oil futures were down 2.6% at $61.59 a barrel. The U.S. Energy Information Agency (EIA) in its weekly report for Wednesday 22nd January showed that crude stockpiles fell by 0.4 million barrels in the week ending January 17, against forecasts for a decline of 1.0 million barrels.
Crude prices hit nine-week lows as global fears over the new coronavirus pushed the oil market closer to its worst monthly loss since May 2019. Oil fortunes have nosedived after a 35% gain for WTI in 2019 and 24% for Brent.
The market appeared to be on good footing after the New Year began as U.S.-Iran tensions initially sent crude prices rallying. But that upside was quickly lost as calm returned to the Middle East, and oil bulls have had trouble since capitalizing even on supply blockades in major producing countries Libya and Iraq.
Additionally, the flulike virus, which can be transmitted from person to person, has killed 18 people in China so far and infected more than 600. Wuhan, the Chinese city of 11 million people where the outbreak started in December, is under lockdown as authorities in Beijing and elsewhere attempt to contain the outbreak.
Analysts warn of a larger fallout to global travel and other economic activity that could dent world growth. Goldman Sachs said in a note on Tuesday 21st January it anticipated a 260,000 barrels per day (bpd) negative shock to global oil demand on average, including a 170,000-bpd loss of jet fuel demand. Its analysis was based on comparison with the 2003 SARS health epidemic, which shook global markets, including oil.
