Shell to Receive Two Spot LNG Cargoes at Terminal in India

By Dinakar Sethuraman

Sept. 22 (Bloomberg) -- Royal Dutch Shell Plc will receive two liquefied natural gas cargoes at its import terminal in India this month and next, according to transmissions from ships captured by AISLive on Bloomberg.

Seri Alam, a 145,572 cubic-meter capacity tanker, was at Punta Europa, a LNG supplier in Equatorial Guinea, on Aug. 30 and may arrive at Shell's 75 percent-owned Hazira terminal on Sept. 24., the ship-tracking data showed. Seri Bijaksana, a 152,888 cubic-meter capacity vessel, was at Punta Europa on Sept. 10 and may reach India on Oct. 12.

Indian power producers and manufacturers are turning to imported gas because output from aging fields has failed to keep pace with demand growth. Benchmark prices of naphtha, an alternative feedstock, have risen 12 percent in the last year to about $19 per million British thermal units including shipping cost, facilitating the switch to gas.

Spot LNG prices have declined since summer as lower fall temperatures reduce demand for air-conditioning, PanEurasian Enterprises said in an e-mail today, without giving details.

China paid $14.6 per million British thermal units delivered for an Equatorial Guinea cargo, according to customs figures released in Beijing today. South Korea paid an average delivered price of $17.2 for spot cargoes last month, according to Korea International Trade Statistics' Web site.

Belgium Cargo

Shell received a cargo via Seri Begawan from Belgium at Hazira on Sept. 10, the ship-tracking data showed. The company received at least three cargoes last month from the Atlantic Ocean area in addition to the three it bought in July, the data in July and August showed.

The Hazira terminal buys all of its LNG from the spot market, Jon Chadwick, executive vice president of Shell Gas & Power in Asia, said in November. The company is expanding the 2.5 million metric ton-a-year facility by 1 million tons, Vikram Mehta, chairman of Shell India Ltd., said this year. Total SA owns the remaining 26 percent of Hazira.

A spot LNG cargo typically weighs between 55,000 and 60,000 tons. LNG is natural gas chilled to liquid form, reducing it to one-six-hundredth of its original volume at minus 161 degrees Celsius (minus 258 degrees Fahrenheit) for transportation by ships to destinations not connected by pipeline. It is turned back into gas for distribution to users.

To contact the reporter on this story: Dinakar Sethuraman in Singapore at dinakar@bloomberg.net