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Posts under ‘LNG’

Shell to sell Australian aviation fuels unit to Viva Energy

Shell to sell Australian aviation fuels unit to Viva Energy

by Angela Macdonald-Smith: 19 December 2016

Royal Dutch Shell has struck a $US250 million ($343 million) deal to sell its local aviation fuels division to Viva Energy in a further slimming down of its downstream operations in Australia.

The sale follows the oil giant’s $2.9 billion divestment of its other refining and fuels activities to Viva in 2014 and comes amid heightened speculation that Shell is getting set to offload its remaining stake in Woodside Petroleum.

The deal, expected to formally close by md-2017, will see the Shell brand still used for the aviation refuelling business under a licensing deal similar to the arrangement Viva has to use the logo for its petrol retailing business. Regulatory approvals still need to be secured.

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Shell to offload Dragon gas port

Danny Fortson: December 18 2016: The Sunday Times

Shell has begun quietly sounding out potential buyers for its share of a giant gas- import complex in west Wales.

The FTSE 100 company owns half of Dragon LNG, a terminal at Milford Haven that reheats super-chilled liquid natural gas after it is delivered by tankers. The site has the capacity to provide 10% of Britain’s gas needs.

Petronas, Malaysia’s state oil producer, owns the other half and is likely to have first right of refusal. Dragon is yet another asset that has been put up for sale by Shell, which has pledged to raise $30bn (£24bn) through a global disposal programme to offset the cost of its takeover of rival BG.

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Royal Dutch Shell – Income Investors Should Look Elsewhere

Casey Hoerth: Dec. 14, 2016 11:09 AM ET

Summary

Shell plans on between $25 billion and $30 billion in capex next year, with flexibility to the downside.

I do not expect Shell to achieve cash flow balance in 2016, even with asset sales.

I continue to recommend other energy companies over Royal Dutch Shell, until either oil prices recover more or until Shell does something else to achieve balance.

Over the course of 2016 I haven’t recommended much when it comes buying to upstream or integrated oil companies. The reason was that I felt many still weren’t doing enough to balance their money coming in versus money going out. The CEO of one of my favorite companies, in their latest analyst day, recently quipped that energy companies couldn’t afford to wait to be ‘bailed out’ by higher oil prices.

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Shell awards JGC contract for completion of Prelude LNG vessel

Written by Mark Lammey – 09/12/2016 3:58 pm

Japanese engineering firm JGC Corporation has won a contracted to support the completion of Shell’s Prelude floating LNG facility.

JGC said the construction work on the giant vessel − which is 1,600 ft long, 240ft wide and weighs in at 600,000 tonnes − was in its final stages in South Korea.

Once commissioned, it will produce 3.6million tonnes of LNG per year from the Prelude and Concerto gas fields, in the Browse Basin, off Australia.

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Macquarie eyes Irish gas giant

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By:  Danny Fortson – The Sunday Times

The Australian investment giant nicknamed the “vampire kangaroo” is hoping to sink its teeth into Ireland’s £3bn Corrib gas field.

Macquarie, one of the largest owners of British infrastructure, is understood to have approached Shell over a deal that could value the FTSE 100 giant’s 45% stake in the project at more than £1bn. It is unclear whether the Australians have tabled a formal bid.

Corrib started producing a year ago after years of delays and protests from fishermen, environmentalists and locals.

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LIVING IN TRUMPWORLD

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Comment from Bill Campbell on the Energy Voice Article: Shell stresses importance of stable regulatory environment post-Trump victory

Under Trump, with the senate and congress to support him, we can look forward soon to significant deregulation in the US effecting positively onshore fracking, tar sands development, offshore Deepwater in the Gulf and a boost perhaps to Alaska drilling. One assumes the Keystone pipeline will go ahead and perhaps pipelines running from central US to East Coast for new LNG Plants to supply a Europe hedging its bets over Russian gas availability with Europe’s ongoing problems with Putin, sanctions etc. A significant increase in US output, leading to increase in global supply over demand could dampen oil price. Shell seems to have divested assets recently in the US in some of these areas to offset BG takeover costs so uncertain whether Trumpworld will be good or bad for Shell.

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Shipping to become ‘major new sector’ for LNG: Shell

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by Angela Macdonald-Smith: 2 November 2016

Demand for LNG as a ship fuel has emerged as a much needed new source of growth in the oversupplied market, with oil giant Royal Dutch Shell giving a bullish assessment of the impact of tighter international rules on maritime emissions.

Shell’s head of integrated gas Maarten Wetselaar told investors in London that between shipping and trucking, the transport sector had become “a major new sector” for the LNG market.

The shipping market and the heavy trucking market together represent about 750 million tonnes of potential LNG demand, about three times the current global LNG supply, Mr Wetselaar said. He signalled that last week’s announcement of new rules on emissions from shipping had made Shell more positive on demand from the sector, noting it was an area where the competition was oil rather than cheap coal.

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Shell Among New LNG Sellers for Asia Gas Hub Contender Singapore

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By Ann KohSerene Cheong and Dan Murtaugh: Oct 24, 2016

Singapore, which is vying to become a regional center for the trading of liquefied natural gas in Asia, picked Royal Dutch Shell Plc and Pavilion Gas Pte Ltd. as its next suppliers of the fuel.

The companies will have exclusive rights to sell 1 million metric tons of LNG annually for up to 3 years, with imports beginning in 2017, the city-state’s Energy Market Authority said in a statement. The country will also consider spot purchases of the supercooled fuel and piped natural gas on a case-by-case basis, S. Iswaran, the Minister of Industry, said at the Singapore International Energy Week conference on Monday.

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Singapore awards new LNG import licences to Pavilion Gas and Shell Eastern Petroleum

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By Ann Williams

SINGAPORE – Pavilion Gas and Shell Eastern Petroleum have won exclusive contracts to supply Singapore with its next tranche of liquefied natural gas (LNG), beating out Sembcorp Industries and BG Singapore Gas Marketing.

“These two companies were selected on the basis of the reliability, flexibility and competitive-pricing of their LNG supplies,” said Mr S. Iswaran, Minister for Trade and Industry (Industry). “They have also secured strong support from buyers.”

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Singapore awards LNG import licences to meet future demand

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* Pavilion Gas, Shell win Singapore LNG import licences

* Importers offer shorter term contracts, alternate indices

* Immediate rise in LNG demand unlikely – traders (Updates story with Shell’s comments, details)

screen-shot-2016-10-20-at-23-00-27By Mark Tay: SINGAPORE, Oct 24

Pavilion Gas and Shell Eastern Petroleum have been appointed as importers of liquefied natural gas (LNG) into Singapore, the trade minister said on Monday, as the city-state gears up to take more LNG.

Singapore, which relies almost exclusively on gas for electricity generation, currently takes the bulk of its gas via pipelines from Malaysia and Indonesia but is expected to boost LNG shipments in coming years.

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Shell Said to Consider Sale of $1 Billion Malaysia LNG Stake

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cropped-Screen-Shot-2016-09-09-at-20.58.10.jpgBy Elffie Chew and Joyce Koh: 14 October 2016

Royal Dutch Shell Plc is considering a sale of its stake in a Malaysian liquefied natural gas export plant, which could fetch more than $1 billion, people familiar with the matter said.

Shell is gauging interest in its 15 percent stake in MLNG Tiga Sdn., which owns an LNG terminal in Sarawak on the island of Borneo, according to the people. The sale may draw interest from private-equity firms, the people said, asking not to be identified as the process is private. Malaysia’s state-owned Petroliam Nasional Bhd., which holds 60 percent of MLNG Tiga, has pre-emptive rights on the stake, one of the people said.

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Outlook For Shell Mixed – Caution Ahead

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Gary Bourgeault: October 7, 2016

Summary

  • Debt load associated with BG Group acquisition still weighs heavily on Shell.
  • With a larger percentage of its business gas, it continues to struggle to sustainably break the $3 barrier.
  • EPS will probably drop by over 40 percent for the year.
  • Nigerian asset sales and risks to other holdings in the nation remain a concern.
  • Dividend could remain at current level if the price of oil and gas maintain a higher bottom.

Royal Dutch Shell plc (NYSE:RDS.A) has been taking some good steps to prepare for what it believes will be a strong future for LNG demand, as it puts various pieces of its infrastructure in place around the world. It has the goal of continuing to focus primarily on gas as its major product, looking for a time when it sustainably rebounds in price.

The long term prospects for Shell look fairly solid, but it does face some significant headwinds in the short term, including the debt overhang coming from its acquisition of BG Group, downward pressure on earnings per share (NYSEARCA:EPS), prolonged period of lower natural gas prices, and the loss of revenue from asset sales in Nigeria, along with the risk in the country for other projects it still has there.

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