Post on 02-Oct-2020
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Singapore, Beijing, Tokyo, Sydney, Dubai, Moscow, Astana, Kiev, Porto and Johannesburg
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Market Reporting
Consulting
Events
Energy and commodity price benchmarking and market insights
An international perspective on energy prices IFIEC Energy Forum 2014
Matthew Monteverde 11 June 2014
The slow globalisation of gas
illuminating the markets Copyright © 2014 Argus Media Ltd. All rights reserved. 2006
illuminating the markets Copyright © 2014 Argus Media Ltd. All rights reserved. 2013
illuminating the markets
Liquefaction capacity to jump
Copyright © 2014 Argus Media Ltd. All rights reserved.
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180
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2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2030
Bn
m³
Liquefaction capacity additions by year Algeria
Angola
Australia
Brunei
Canada
Cyprus
Equatorial Guinea
Indonesia
Iran
Iraq
Malaysia
Mozambique
Nigeria
Papa New Guinea
Russia
Tanzania
USA
illuminating the markets
Liquefaction capacity to outpace demand growth
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
20
40
60
80
100
120
140
160
180
200
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2030
Bn
m³
Liquefaction capacity additions by year
New liquefaction capacity Demand growth
illuminating the markets
Liquefaction capacity to outpace demand growth
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
100
200
300
400
500
600
700
800
900
1.000
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027
Cu
mu
lative
, b
n m
³
Cumulative new liquefaction v demand growth
New liquefaction capacity Demand growth
illuminating the markets
Liquefaction capacity to outpace demand growth
Copyright © 2014 Argus Media Ltd. All rights reserved.
-150
-100
-50
0
50
100
150
200
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027
Cu
mu
lative
, b
n m
³
Net shortfall-surplus
Net new LNG supply
illuminating the markets
Global prices remain divided
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0
2
4
6
8
10
12
14
16
18
20
Ja
n-0
4
Ap
r-0
4
Ju
l-0
4
Okt-
04
Ja
n-0
5
Ap
r-0
5
Ju
l-0
5
Okt-
05
Ja
n-0
6
Ap
r-0
6
Ju
l-0
6
Okt-
06
Ja
n-0
7
Ap
r-0
7
Ju
l-0
7
Okt-
07
Ja
n-0
8
Ap
r-0
8
Ju
l-0
8
Okt-
08
Ja
n-0
9
Ap
r-0
9
Ju
l-0
9
Okt-
09
Ja
n-1
0
Ap
r-1
0
Ju
l-1
0
Okt-
10
Ja
n-1
1
Ap
r-1
1
Ju
l-1
1
Okt-
11
Ja
n-1
2
Ap
r-1
2
Ju
l-1
2
Okt-
12
Ja
n-1
3
Ap
r-1
3
Ju
l-1
3
Okt-
13
Ja
n-1
4
Ap
r-1
4
Ju
l-1
4
$/m
n B
tu
The three-speed market persists
Japan LNG Henry Hub NBP
Japan
illuminating the markets
Japanese import prices
Copyright © 2013 Argus Media Ltd. All rights reserved.
0
5
10
15
20
25
Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14
$/m
n B
tu
Spot and long-term delivered prices by exporting country
Term Spot
Term: Abu Dhabi, Australia, Brunei, Indonesia, Malaysia,
Oman, Qatar, Russia, US
Spot: Algeria, Belgium, Egypt, Equatorial Guinea,
France, Norway, Nigeria, Peru, Spain, Trinidad, Yemen
illuminating the markets
Japanese import prices
Copyright © 2013 Argus Media Ltd. All rights reserved.
0
5
10
15
20
25
Jan 04 Jan 05 Jan 06 Jan 07 Jan 08 Jan 09 Jan 10 Jan 11 Jan 12 Jan 13 Jan 14
$/m
n B
tu
Spot and long-term delivered prices by exporting country
Term Spot Japan oil index
Term: Abu Dhabi, Australia, Brunei, Indonesia, Malaysia,
Oman, Qatar, Russia, US
Spot: Algeria, Belgium, Egypt, Equatorial Guinea,
France, Norway, Nigeria, Peru, Spain, Trinidad, Yemen
illuminating the markets
Japanese import prices
Copyright © 2013 Argus Media Ltd. All rights reserved.
0
5
10
15
20
25
Mai 12 Okt 12 Apr 13 Okt 13 Apr 14
$/m
n B
tu
Spot and long-term delivered prices by exporting country
Term Spot Japan oil index ANEA
Term: Abu Dhabi, Australia, Brunei, Indonesia, Malaysia,
Oman, Qatar, Russia, US
Spot: Algeria, Belgium, Egypt, Equatorial Guinea,
France, Norway, Nigeria, Peru, Spain, Trinidad, Yemen
Europe
illuminating the markets
The collapse
Copyright © 2014 Argus Media Ltd. All rights reserved.
40
45
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55
60
65
70
75
01-Mai-2013 01-Jul-2013 01-Sep-2013 01-Nov-2013 01-Jan-2014 01-Mrz-2014 01-Mai-2014
p/t
h
Forward month prices for Winter 2013-14/Summer 2014
Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14
illuminating the markets
Winter demand at historic lows
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0
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400
450
J F M A M J J A S O N D
Mo
nth
ly a
ve
rag
e d
em
an
d (
mn
m³/
d)
UK demand at lowest since at least 1998
Range 1998-2013 Winter 2013-14
illuminating the markets
Storage
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
20
40
60
80
100
120
Jan Mrz Mai Jun Aug Okt Dez
Pc o
f to
tal ca
pa
city
German stocks unusually high after mild winter
2010 2011 2012 2013 2014
illuminating the markets
Storage
Copyright © 2014 Argus Media Ltd. All rights reserved.
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120
Jan Mrz Mai Jun Aug Okt Dez
Pc o
f to
tal ca
pa
city
German stocks unusually high after mild winter
2010 2011 2012 2013 2014 2014 - projected at recent injection rate
illuminating the markets
Storage
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
20
40
60
80
100
120
Jan Mrz Mai Jun Aug Okt Dez
Pc o
f to
tal ca
pa
city
German stocks unusually high after mild winter
2013 2014 2014 - projected at recent injection rate
8.4bn³
illuminating the markets
Storage
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
20
40
60
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100
120
Jan Mrz Mai Jun Aug Okt Dez
Pc o
f to
tal ca
pa
city
German stocks unusually high after mild winter
2013 2014 2014 - projected at recent injection rate
8.4bn³ 50mn m³/d
The US
illuminating the markets
US spot prices and the winter of 2013-14
Copyright © 2014 Argus Media Ltd. All rights reserved.
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4
4
5
5
6
6
7
7
8
8
01-Mai-2013 01-Jul-2013 01-Sep-2013 01-Nov-2013 01-Jan-2014 01-Mrz-2014 01-Mai-2014
$/m
n B
tu
US day-ahead prices
Henry Hub
illuminating the markets
US spot prices and the winter of 2013-14
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
5
10
15
20
25
30
35
40
45
01-Mai-2013 01-Jul-2013 01-Sep-2013 01-Nov-2013 01-Jan-2014 01-Mrz-2014 01-Mai-2014
$/m
n B
tu
US day-ahead prices
Henry Hub Chicago
illuminating the markets
US spot prices and the winter of 2013-14
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
10
20
30
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50
60
70
80
01-Mai-2013 01-Jul-2013 01-Sep-2013 01-Nov-2013 01-Jan-2014 01-Mrz-2014 01-Mai-2014
$/m
n B
tu
US day-ahead prices
Henry Hub Chicago Algonquin
European shale gas
illuminating the markets
European shale reserves
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0
500
1.000
1.500
2.000
2.500
3.000
3.500
4.000
4.500
BG DK FR DE NL PL RO ES UA UK
Ris
ke
d te
ch
nic
ally
re
co
ve
rab
le r
ese
rve
s (
bn
m³)
Reserves
Technically recoverable shale oil and shale gas resources: an assessment of 137
shale formations in 41 countries outside the United States – EIA – June 2013
illuminating the markets
European shale reserves
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
5.000
10.000
15.000
20.000
25.000
BG DK FR DE NL PL RO ES UA UK CA MX AR AU
Ris
ke
d te
ch
nic
ally
re
co
ve
rab
le r
ese
rve
s (
bn
m³)
Reserves
Technically recoverable shale oil and shale gas resources: an assessment of 137
shale formations in 41 countries outside the United States – EIA – June 2013
illuminating the markets
Such drilling is not happening in Europe
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0 100 200 300 400 500
NL
BE
UK
DE
IT
CH
CZ
DK
PL
SL
FR
PT
HU
PA
AT
TK
ES
UA
BG
IE
Persons/km²
Population density
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Such drilling is not happening in Europe
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Analysis and presentation of the results of the public consultation “Unconventional fossil fuels
(e.g. shale gas) in Europe – Final report – European Commission DG Environment 3 October 2013
Coal
illuminating the markets
Northwest European prices lowest since 2010
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250
Okt 2001 Okt 2003 Okt 2005 Okt 2007 Okt 2009 Okt 2011 Okt 2013
$/t
API 2 prices hover around $75/t
API2 index
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Northwest European prices lowest since 2010
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
5
10
15
20
25
0
50
100
150
200
250
Okt 2001 Okt 2003 Okt 2005 Okt 2007 Okt 2009 Okt 2011 Okt 2013
€/M
Wh
$/t
API 2 hover around $75/t or €7/MWh
API2 index
illuminating the markets
Coal price decline is global
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0
5
10
15
20
25
0
50
100
150
200
250
Okt 2001 Okt 2003 Okt 2005 Okt 2007 Okt 2009 Okt 2011 Okt 2013
€/M
Wh
$/t
The drop in prices is not limited to northwest Europe
API2 index API4 index API 6 index
US coal exports and global trade
illuminating the markets
Worldwide coal exports increasing
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
100
200
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500
600
700
800
900
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
mn
t
Supply from major exports rising
Indonesia China Australia Russia Poland South Africa Canada United States Colombia
illuminating the markets
Worldwide coal exports increasing
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-20
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60
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0
100
200
300
400
500
600
700
800
900
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
mn
t
Rate of increase accelerated early in the decade
Growth rate Coal exports
illuminating the markets
Coal exports: 2007
Copyright © 2014 Argus Media Ltd. All rights reserved. illuminating the markets
US: 24mn t
Colombia: 68mn t
South Africa: 65mn t
Russia: 77mn t
Australia: 112mn t
Indonesia: 122mn t
illuminating the markets
Coal exports: 2013
Copyright © 2014 Argus Media Ltd. All rights reserved. illuminating the markets
US: 44mn t
Colombia: 75mn t
South Africa: 72mn t
Russia: 109mn t
Australia: 188mn t
Indonesia: 330mn t
illuminating the markets
Coal exports: 2007
Copyright © 2014 Argus Media Ltd. All rights reserved. illuminating the markets
6mn t
illuminating the markets
Coal exports: 2013
Copyright © 2014 Argus Media Ltd. All rights reserved. illuminating the markets
46mn t
23mn t
5mn t
illuminating the markets
Northwest European prices lowest since 2010
Copyright © 2014 Argus Media Ltd. All rights reserved.
0
50
100
150
200
250
Okt 2001 Okt 2003 Okt 2005 Okt 2007 Okt 2009 Okt 2011 Okt 2013
$/t
API 2 prices hover around $75/t
API2 index
What could change this situation?
The US exports less?
illuminating the markets
The US power supply mix is price sensitive
Copyright © 2014 Argus Media Ltd. All rights reserved.
50
70
90
110
130
150
170
190
Sep 2008 Sep 2009 Sep 2010 Sep 2011 Sep 2012 Sep 2013
TW
h
The surge in gas-fired power output was temporary
Coal Gas
illuminating the markets
The US power supply mix is price sensitive
Copyright © 2014 Argus Media Ltd. All rights reserved.
50
70
90
110
130
150
170
190
Sep 2008 Sep 2009 Sep 2010 Sep 2011 Sep 2012 Sep 2013
TW
h
Power output
Coal Gas
0
1
2
3
4
5
6
7
8
Sep 2008 Sep 2009 Sep 2010 Sep 2011 Sep 2012 Sep 2013
$/m
n B
tu
Gas prices
Henry Hub Katy SoCal
illuminating the markets
The US power supply mix is price sensitive
Copyright © 2014 Argus Media Ltd. All rights reserved.
50
70
90
110
130
150
170
190
Sep 2008 Sep 2009 Sep 2010 Sep 2011 Sep 2012 Sep 2013
TW
h
Power output
Coal Gas
0
50
100
150
200
Sep 2008 Sep 2009 Sep 2010 Sep 2011 Sep 2012 Sep 2013
$/t
Coal prices
API 2 - monthly average
India buys more?
illuminating the markets
The importance of India
Copyright © 2014 Argus Media Ltd. All rights reserved. illuminating the markets
US: 44mn t
Colombia: 75mn t
South Africa: 72mn t
Russia: 109mn t
Australia: 188mn t
Indonesia: 330mn t
India: 122mn t
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The rupee
Copyright © 2014 Argus Media Ltd. All rights reserved.
30
35
40
45
50
55
60
65
70
Nov 2001 Nov 2003 Nov 2005 Nov 2007 Nov 2009 Nov 2011 Nov 2013
INR
, m
on
thly
ave
rag
e
Weakness of the rupee effectively lowers Indian buying
INR/USD
illuminating the markets
The rupee
Copyright © 2014 Argus Media Ltd. All rights reserved.
30
130
230
330
430
530
630
Nov 2001 Nov 2003 Nov 2005 Nov 2007 Nov 2009 Nov 2011 Nov 2013
Ind
ex, N
ove
mb
er
20
01
= 1
00
Weakness of the rupee effectively lowers Indian buying
API 4 (USD) API 4 (INR)
illuminating the markets
The rupee
Copyright © 2014 Argus Media Ltd. All rights reserved.
15
35
55
75
95
115
135
155
175
30
130
230
330
430
530
630
Nov 2001 Nov 2003 Nov 2005 Nov 2007 Nov 2009 Nov 2011 Nov 2013
$/t
Ind
ex, N
ove
mb
er
20
01
= 1
00
Weakness of the rupee effectively lowers Indian buying
API 4 (USD) API 4 (INR)
Producer investment cycles?
illuminating the markets
Will overcapacity come out of the market?
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-20
0
20
40
60
80
100
0
20
40
60
80
100
120
140
160
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
$/t
Price and historic export growth
Export growth rate API2 annual average
Conclusions
Any questions?
Matthew Monteverde
VP — Generating Fuels
matthew.monteverde@argusmedia.com
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