Two more components of the global liquefied natural gas (LNG) supply infrastructure recently came online, adding liquefaction and regasification capacity.

Yemen LNG Co. recently began producing LNG from its second train one month ahead of schedule. And South Hook in South West Wales — Europe’s largest liquefied natural gas (LNG) receiving terminal — is fully commissioned with the completion of its second phase, South Hook LNG Terminal Co. LTC said last week.

With the completion of Yemen LNG Train 2 at the terminal at Balhaf on the Gulf of Aden, Yemen LNG production will soon reach design capacity of 6.7 million metric tons per year, the company said.

Train1 began production on Oct. 15. Yemen LNG has delivered LNG to Total Gas and Power, GDF Suez and KOGAS under 20-year sales and purchase agreements. Deliveries were made to Korea, the United States, China, Mexico and Spain, the company said.

The Yemen LNG project is the largest investment ever made in Yemen at around US$4.5 billion, the company said. Gas supplied from Block 18 in the Marib region of central Yemen is treated in cryogenic units for propane extraction and transported through a 320-km (199-mile) pipeline to the LNG plant on the southern coast of Yemen.

In a recent note analysts at Barclays Capital revised their U.S. LNG import forecast downward to 3 Bcf/d, which still represents a year-over-year (y/y) increase of 1.8 Bcf/d (see NGI, March 29).

“While global LNG supply is running 7 Bcf/d above year-ago levels, ahead of our forecast, Q1 ’10 imports were dampened by cold weather in other countries that boosted their LNG takes, causing our annual average 2010 U.S. import number to fall somewhat,” the analysts said. “As we transition through the northern hemisphere winter demand season, the Atlantic spot LNG market should experience a growing flood of supply. Europe’s large increase in LNG imports last year is not expected to be matched with a similar y/y increase in 2010.”

Yemen LNG shareholders are TOTAL, project leader (39.62%), Yemen Gas Co. (16.73%), Hunt Oil Co. (17.22%), SK Energy Co. Ltd. (9.55%), Korea Gas Corp. (6.00%), the General Authority for Social Security and Pensions of Yemen (5.00%) and Hyundai Corp. (5.88%).

South Hook is part of the Qatargas 2 project and has processing capacity of 15.6 million metric tons per year of LNG and is capable of delivering up to 21 billion cubic meters (bcm) of gas per year into the National Transmission System (NTS). South Hook is owned by a United Kingdom joint venture of Qatar Petroleum (67.5%), ExxonMobil (24.15%) and Total (8.35%).

“South Hook demonstrates a major strengthening of the strategic partnership between Qatar and the UK. It is the first Qatari involvement abroad in a downstream terminal and is a major component of Qatar’s LNG supply portfolio as the world’s leading LNG supplier,” South Hook said.

“The South Hook Terminal’s ability to import LNG is important to the UK’s long-term energy needs and the UK now has an additional major gas entry point in the West for the national grid gas system.”

Train 5 of Qatargas 2 went online last year (see NGI, Sept. 14, 2009). Qatargas 2 links gas production, liquefaction, shipping and regasification infrastructure. In addition to Trains 4 and 5, the Qatargas 2 joint venture encompasses a fleet of Q-Max and Q-Flex carriers as well as the South Hook terminal.

Atlantic Basin LNG trade has strengthened as a linkage between U.S. and European gas markets. J.P. Morgan recently acquired regasification capacity at the Sabine Pass terminal in Louisiana and said it plans to develop a gas business in Europe that is similar to what it has in the United States (see NGI, April 5). “It’s becoming more obvious to us that trading North American gas and trading European gas independently from one another doesn’t make sense, although five years ago the two really did trade independently from one another,” Paul Posoli, J.P. Morgan head of global power, gas, coal and emissions, told NGI.

Last week Excelerate Energy LLC said it is seeking a partner to market gas from its Gulf Gateway LNG terminal off the Louisiana Coast. Such a deal could be similar to one Excelerate struck last year with Barclays Capital for its Northeast Gateway terminal off the Massachusetts coast, Andree Stracke told NGI. The investment banking division of Barclays Bank PLC will provide Excelerate with fixed-price hedging mechanisms. Additional services include taking physical delivery, transport and optimization of cargoes through profit-sharing by the parties.

Stracke said Excelerate is just beginning discussions on a partner at Gulf Gateway, noting that the company will be short-listing contenders through June for a decision later in summer. Barclays will be considered, he said. Gulf Gateway has been idle since Hurricane Ike in 2008 damaged pipeline infrastructure used by the terminal. Stracke said some of that has now been repaired, but the terminal has not received a cargo since before the hurricane. Since its commissioning Gulf Gateway has received 10-15 cargoes, he said.

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