You Don't Need Asia To Get $12 For Your Liquefied Natural Gas
(Bloomberg) -- You don’t need to send your liquefied natural gas to Asia to get high prices.
Dragon LNG, an import facility in Wales owned by Royal Dutch Shell Plc and Malaysia’s Petroliam Nasional Bhd, boosted its supplies to the U.K. grid to the highest in three years on Tuesday. That came as cold weather pushed prompt prices to almost $12 a million British thermal units, matching the three-year high paid by buyers in North Asia for spot LNG this winter.
With strong demand forecast through this week, the limited supply from Dragon didn’t gush out. Flows from the terminal reached their maximum rate of about 7 percent of total U.K. supply at about 11:24 a.m. London time Tuesday, according to data from National Grid Plc.
The cold gripping Britain will last a few more days, raising the prospect of even higher prices. Dragon had about 111 million cubic meters of gas in storage on Monday, or just over a quarter of Tuesday’s anticipated demand, having not received a tanker since January.
Dragon is “delighted” to help boost the resilience of the U.K. energy system, it said by email.
This week’s freezing cold is big test of the European gas system, which might get more interesting, said Guillermo Baena Gomez, senior gas trader at Advantage Utilities Ltd. in London.
“This is not going to be like a Usain Bolt 100 meter race,” he said by phone. “This is going to be a marathon.”
To contact the reporter on this story: Mathew Carr in London at email@example.com. To contact the editors responsible for this story: Reed Landberg at firstname.lastname@example.org Rob Verdonck, Andrew Reierson.
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.