In a webinar on Wednesday Sophie Tan, Head of Asia Pacific Business Intelligence, Poten & Partners (Singapore) said that 228m tonnes of liquefaction capacity had been planned for FID this year. Since March FID on at least 74m tonnes of new liquefaction projects has been deferred. In particular projects in North America are seeing delays.
Tan said that major players had taken $70bn in investments off the table to conserve cash due to the weaker oil price and turmoil caused by the COVID-19 pandemic.
The spot market now plays a much greater part in the LNG supply chain accounting for around 30% of the market.
A shift in buying patterns is being observed. Tan noted Pavilion LNG in Singapore “really surprised” with a recent five-year supply tender that excluded greenfield projects. She noted the tender appeared to be aimed at portfolio players with an oversupply.
In Southeast Asia Tan said there would likely be see Force Majeure being declared on some contracts and some cargo deferments. These developments could lead to tighter winter season supply.
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