LNG as a global market ESCP London School London, September 22nd, 2015 GUY BROGGI SENIOR ADVISOR, LNG DIVISON

Transcription

1 LNG as a global market ESCP London School London, September 22nd, 2015 GUY BROGGI SENIOR ADVISOR, LNG DIVISON

2 Today s Menu (and take-aways ) Latest changes in the LNG landscape 2014 was a continuation of What happened to LNG prices from July 2014? The current situation of LNG actors New LNG supply: For Asia or Europe? Austral Asia..Targeting NE-Asia Southern Atlantic.South America? Northern Atlantic.The Arctic Race for markets And the winners are.. In a Buyers Market, the Biggest Suppliers can wait

3 2014 LNG Imports (Mton) : Source: IHS CERA for IGU 1 Mton LNG = 1.38 Bcm of gas

4 Current and future suppliers of LNG (+candidates) Source: HIS CERA for IGU 244 Mt exported in 2014

5 Recent trends in LNG imports (Mton) Before and after Fukushima

6 MMtpa LNG imports by Regions LNG imports by region Europe S. America Asia-Pacific N. America MENA Source: IHS 2015 IHS

7 What happened to LNG prices since July 2014?

8 Gas Markets & LNG spot prices ($/MBtu) (August Brent = 100$/b) NBP=TTF 6.2 Med 10 HH 4.5 JKM Start of over supply situation

9 Gas Markets & LNG spot prices ($/MBtu) (January Brent = 50$/b) 12 NBP=TTF 7 Med 7 HH <3 JKM Double effect of crude and LNG over supply

10 Gas Markets & LNG spot prices ($/MBtu) ( Sept Brent = 50$/b) NBP=TTF 6.5 Med 6.5 HH <3 JKM Spot prices equalization for the first time ever (except US)

11 JKM & METI«spot» price indicators vs actual monthly import prices a*jcc(n-3) +b JAPAN KOREA TAIWAN CHINA JKM METI SPOT Oct-12 Jan-13 May-13 Aug-13 Nov-13 Mar-14 Jun-14 Sep-14 Dec-14 Apr-15 Jul-15 Japan LT LNG prices «proxi»: 14.85% *JCC[n-3] - a

12 a*jcc(n-3) +b JAPAN KOREA TAIWAN CHINA ARGENTINA JKM METI SPOT Mar-14 Jun-14 Sep-14 Dec-14 Apr-15 Jul-15 Oct-15

13 Sources for «spot» LNG sales Extra LNG Early start-up Orphan LNG IOC s portfolio LNG Plants Flex LNG Contract changes LNG Terminal Divertable LNG Margin sharing End of LT s/c & DQT Re-loads Delayed Opening

14 The race for new LNG LT supply to the World Prepare 2025 LNG Market share Difficult FID s Best window for US FID s Wait & Sink Prices Which will be first? Costs «Flexible» Spot LNG A new «Cold War» breaking in the Arctic between Alaska and Russia

15 Suppliers race to Markets

16 NOC s & IOC s future LNG plants (under study) «Time is of essence»

17 Australian LNG estimate >100 Mtpa by 2020 Prelude 3.6 Mt (FLNG) Gorgon15 Mt + 5 MT (4th train) Pluto 4.3 Mt Bonaparte LNG FROZEN GreaterSunrise FROZEN Ichthys 8.4 Mt Australia Pacific LNG (CBM) 9Mt Queensland Curtis (CBM) 8.5 Mt Wheatstone LNG 8.6 Mt Scarborough 6.25 Mt Browse LNG FROZEN Fisherman s Landing (CBM) 1.5 Mt??? Gladstone LNG 7.2 Mt (CBM) Arrow LNG FROZEN PNG could add 1 or 2 trains to the 10Mtpa Exxon Project now producing, and Don t discard Indonesia for new LNG too! Newcastle LNG (CBM) Eastern Gas 1 Mt

18 Southern Atlantic LNG: +23 Mtpa (+39Mtpa) Venezuela, Delta Caribe 9.4 Mt Nigeria, Olokola 22Mt Venezuela, Delta Caribe 4.7 Mt Nigeria, Brass, 10 Mt Nigeria, NLNG T7, 8.5 Mt Cameroon LNG 3 Mt Eq Guinea EG LNG T2 4.4 Mt New LNG Post Tcf Mozambique & Tanzania probable winners of The race for Asian Markets from India to Japan Nigeria could wake-up too..

19 Northern Atlantic Alaska 20 Mtpa Pechora LNG 5 Mt YAMAL LNG 16.5 Mt Canada >100 Mtpa US Mtpa Baltic LNG 10 Mt Far East LNG 30Mt Sakhalin- I & II + Vladivostok The toughest race for FID s these days (US 48, Alaska, Canada, East & Arctic Russia) Shaping a new energy landscape post 2025

20 US and Russia LNG competitors Panama and Arctic route well positioned for potential basins arbitrage

21 * 50 Historical FIDs Mtpa Recent LNG Projects FID s Massive New LNG CAPACITY by 2020: more than 100 Mtpa LNG LNG WORLD Rest of World Qatar Australia USA Russia Three projects in the US took FID in 2014 (Freeport, Cove Point, Cameron) adding ~30 Mtpa Already 15 Mtpa US projects took FID in 2015 (Freeport T3, Corpus Christi) taking advantage of already secured SPAs (*) Year-to-date

22 CANADA AND THE US FIGHTING FOR LNG EXPORTS MARKETS Prince Rupert (BG) Douglas Channel (BC LNG) Woodfibre LNG Oregon LNG Jordan Cove LNG Canada (Shell) Kitimat (Chevron) Pacific Northwest LNG (Petronas) Exxon/Imperial Oil Mtpa Export project type New plant Regas terminal available for re-export Under construction Non FTA authorization** H-Energy LNG Goldboro LNG Magnolia LNG Cove Point Mtpa Sabine Pass Lake Charles Gulf Coast LNG Alaska LNG Alaska SCLNG (ex Valdez) Golden Pass Freeport Pangea LNG Corpus Christi Gulf Coast LNG Barca/EOS FLNG Lavaca Bay LNG Waller LNG Cameron Gasfin LNG Main Pass Hub CE FLNG Elba Island * Canadian National Energy Board Authorization **DOE Authorization for export to FTA / non FTA countries *** FERC Authorization to build the plant

23 BEST ESTIMATE OF NORTH AMERICA LNG EXPORTS NORTH AMERICA US / Canada LNG export scenario Most probable American projects Bcm Mtpa LNG Canada (Shell) Pacific Northwest LNG (Petronas) Sabine Pass Freeport Corpus Christi Cove point Elba Island Cameron Alaska SCLNG

24 And the LNG demand is..

25 Serious Candidates for LNG imports: new re-gas terminals (excluding India, China, Japan, Korea and Taiwan) Malaysia, Indonesia, Vietnam, Philipines, Chile, Pakistan, Bangladesh, Egypt, Jordan, UAE, Columbia, Israel, Baltic countries, South Africa, Uruguay new imports

26 Europe LNG terminals as of 2013 (210Bcm regas capacity- 22% load factor)

27 Conclusions Mid-term Europe and Asia will share flexible supply Long-term (> 2020) Austral Asia & Russia to supply Asian buyers Australia, PNG, Russia, North America and Mozambique in the race for securing Buyers in Asia European Buyers may count on Flex LNG From existing hidden LNG From contracted LNG export from the US (and Canada?) US Gulf of Mexico LNG exports to prove a good bet for both Europe & South America LT Buyers to decide which projects they like best

28 Total - A global LNG player Snohvit Shtokman Yamal South Hook Dunkerque LNG Fos Cavaou Sabine Pass Hazira Altamira NLNG T1-T6 Angola LNG Yemen LNG Qatargas 2 Qatargas 1 Adgas Qalhat LNG Oman LNG Ichthys Bontang GLNG Existing LNG supply LNG projects under construction LNG projects (FEED or under study) Existing regasification terminals Under construction regasification terminals * Group share of LNG production, by affiliates and equity interests (including production equivalent for Bontang LNG facility) ** LNG purchases by the Group, including those from subsidiaries and participations that are part of the Upstream LNG portfolio

29 LNG, FASTEST GROWING GAS SEGMENT WORLD LNG SUPPLY FORECAST VS ESTIMATED DESTINATIONS (AS OF SEPTEMBER 2015) LNG supply by project Bcm/y Mtpa LNG CALL by region Bcm/y CAGR15/25 Mtpa % New sanctioned projects mainly from Australia, US and Russia adding 40% of the existing capacity in the next 5 years Europe: flexible market (pipeline competition) as well as Asian newcomers 29