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UpstreamOnline: Storage talk wide of mark at Shell

By Upstream staff

Shell is actively looking to sell the cargo of LNG it has sitting in storage on board a vessel off the Norwegian coast and has no plans to make a permanent storage facility in the area, writes Lucy Hine.

General manager of commercial shipping Andrew Robson said the company is looking for a commercial deal on the cargo, which is currently sitting on the 138,000-cbm Golar Winter (built 2004) in Vetlefjorden, Norway.

He acknowledged that the ship is a modern vessel designed to minimise cargo boil-off and so in theory could sit there for some time. However, he added:“We are actively looking to place the cargo in that ship into port somewhere as we speak.”

Robson´s comments discount some market talk that had suggested Shell was looking to make some kind of permanent LNG storage arrangement in the area.

He revealed that the cargo currently on board the ship was originally purchased for shipment to Shell´s LNG receiving terminal at Hazira in India, and explained that Shell then found a second cargo under“more attractive commercial terms”that was sent to India instead.

Robson said he could not comment from an industry perspective as to whether there are likely to be more of these temporary cargo-storage deals done on LNG.

But he said that as a supply organisation Shell is likely to be long or short on cargo at times and so will be out looking to buy a cargo or, in this case, hold a cargo until the company has an appropriate destination for it.

Shell got the attention of the LNG industry last month when it was discovered that a cargo from Egypt belonging to the company and loaded onto the Golar Winter in June remained on board the vessel anchored off Norway awaiting arbitrage opportunities.

At the time, Shell said:“At this stage (it is) not known how long she will remain at anchor or where ultimately she will discharge.”

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