Natural Gas News – December 21, 2018
Major LNG Shortage Increasingly Likely
Oil Price reported: Liquefied natural gas (LNG) buyers’ willingness to commit to new long-term contracts has increased significantly during 2018 amid expectations of a tighter LNG market. Looking ahead to 2025, Rystad Energy argues a major shortage of liquefied natural gas is looking increasingly likely. 2018 was another bumper year for LNG with strong demand growth driven by Asia. While the market is projected to see very strong supply growth centered on flexible US LNG volumes over the next two years, global demand is growing even faster. “Rystad Energy forecasts heightened risk of an emerging deficit of LNG supplies post 2022,” says Sindre Knutsson, senior analyst on Rystad Energy’s Markets team. By the end of November 2018, contract volumes of long-term sales and purchase agreements (LT SPAs) were up by 38% on a year-on-year basis.
OG&E announces plan to purchase power plants; customers to see savings, environmental benefit
Market Watch reports: Oklahoma Gas & Electric, the utility subsidiary of OGE Energy Corp. OGE, +0.50% announced today that, pending regulatory approval, it will acquire two existing power plants to meet customers’ energy needs. The plants will replace capacity currently provided by power purchase contracts set to expire in 2019. The company announced it will acquire the Shady Point plant near Poteau, Oklahoma, and the Oklahoma Cogeneration plant in Oklahoma City. The Shady Point facility, currently owned by AES Corporation, is a 360MW coal- and natural gas-fired plant utilizing circulating fluidized bed boilers that produce lower emissions due to their design features and emissions controls. The Oklahoma Cogeneration facility, owned by Oklahoma Cogeneration LLC, is a 146MW natural gas-fired combined-cycle plant. The company will pay approximately $53 million for the two plants, which currently serve OG&E customers.