Inspection and monitoring system using an aerial robot guided by artificial vision
2. ALGORITMOS DE CONTROL
As executive director for the Deloitte Center for Energy Solutions, Deloitte Services LP,
ANDREW SLAUGHTER works closely with Deloitte’s Energy and Resources leadership to define, implement and manage the execution of the Center’s strategy. He also helps develop and drive energy research initiatives and manage the development of the Center’s eminence and thought leadership. During his 25-year career as an oil and gas leader, he has occupied senior roles in both major oil and gas companies and consulting/advisory firms.
The LNG sector is undergoing change as projects are consolidated in regions with an abundance of proposed, expensive LNG export projects, and as gas prices fluctuate alongside other en- ergy benchmarks. Hydrocarbon Process-
ing spoke to Andrew Slaughter, execu-
tive director for the Deloitte Center for Energy Solutions, about the state of the LNG industry and how trade patterns and project slates could change in the upcoming years.
LNG
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down from the $15/MMBtu to $16/ MMBtu range to below $10/MMBtu.
Long-term LNG supply contracts into Asia have largely remained linked to oil in some way throughout the history of LNG trade. Depending on the supply-demand balance at the time of contract negotia- tion, the nature of the linkage can vary, giving a degree of price responsiveness to market conditions. When oil prices are low, there is less incentive to look for alternative price methodologies, such as gas-indexed pricing.
The introduction of US LNG supply, with feed gas purchased at Henry Hub- related prices, will introduce an element of gas-indexed pricing into the market, but it is unlikely that this can be applied to gas from other sources in the near to medium term.
HP. What conditions would need
to be in place for an Asian LNG hub to be successful?
Slaughter. To establish a commod-
ity trading hub around which to develop financial trading, you need a location
where physical delivery of the traded commodity is possible, and a spot market with the potential to trade sufficient vol- umes to underpin demand for participa- tion in a financial market.
Both of these elements are at a relative- ly early stage in Asia. Singapore has devel- oped LNG facilities to import LNG for its domestic gas needs and has ambitions to expand this to be the basis for a regional hub. Spot trade in LNG in Asia has grown in recent years, partly consequent on Ja- pan’s need to secure additional gas on a short-term basis as a power generation fuel to replace nuclear generation. However, most gas is still traded on long-term point- to-point contracts, and LNG trade is struc- turally much less fungible than oil trade.
The critical question is whether enough liquidity can be established to support physical and financial market trading. Asian buyers and sellers have largely been risk averse, mostly wanting to lock in supply and pricing arrangements. There may have to be a major shift in this preference to allow the takeoff of a signifi- cant new LNG trading hub.
HP. What do you see as the major
factors that will contribute to the success or failure of floating LNG (FLNG) ventures?
Slaughter. The main advantages of
FLNG are that this technology allows for the development of gas in more remote offshore locations. Also, the FLNG ves- sel can be relocated at the end of the eco- nomic life of the initial field.
In some cases, FLNG development costs can be lower than those of onshore liquefaction. Shell and Petronas are both developing large-scale FLNG projects for deployment offshore Australia and Malay- sia, and there is a much smaller FLNG ves- sel due to be deployed offshore Colombia. These projects will come onstream in the next two to three years, and achieve- ments will be measured by their cost and operational reliability. If success on these initial projects is demonstrated, then there are many other candidate fields around the world where FLNG could be a viable development option.
HP. Which countries will shape
global LNG trade flows over the next five years?
Slaughter. The number of countries
becoming either sellers or buyers of LNG has expanded significantly in recent years, to approximately 20 exporting countries and 30 importing countries.
New sources of supply into this global market are actively under development, including the US (although the US has al- ready been a long-term exporter of LNG on a small scale, with gas shipped from the Kenai facility), Canada, Mozambique and Tanzania.
On the importing side, several smaller new markets are emerging, such as Egypt, Pakistan and Poland. Deloitte expects the most significant impact on global trade to come from the establishment of the US as a major source of new supply, along with Qatar and Australia. In particular, this gives Asia’s large buyers more supply op- tions and some exposure to North Ameri- can hub-based pricing.
The Panama Canal expansion opens up a shorter trade route for US Gulf Coast LNG to access Asian markets and enhances its competitive position. With respect to LNG imports, Deloitte will be closely watching trends in China and In- dia for indications of which mix of supply sources they will favor.
Hydrocarbon Processing | JULY 201559