Refinery Margins Soften and Focus Shifting from Gasoline to DistillateOil prices have moved lower in their current trading range on bearish news, but they will increase as the global stock surplus falls significantly in 2H16 and 2017. Refinery margins have softened and may prompt some trimming of discretionary runs, especially this autumn. Product stock levels are high with gasoline inventory coverage relative to local/export demand near the top of the historical band. Middle distillate stocks are well above their historical range, but rising seasonal demand will tighten inventory in terms of days of supply forward coverage. Product markets are getting an early start on the seasonal price shift from gasoline toward distillate, with gasoline cracks starting their seasonal decline earlier than normal. Diesel cracks will gradually recover and take the lead from gasoline.
A stout national cooling degree-day (CDD) count (more than 10% higher year-on-year) has spurred an expansive role for gas in electric dispatch this month, enabling further recovery in cash prices. To be sure, widespread heat and a host of supply-side maintenance issues culminated in setting the ~$2.80/MMBtu month-to-date price for Henry Hub (HH) deliveries. Yet, despite the one-two punch of weather-aided demand and production disruptions, only a few regional price points managed to outpace the benchmark, with the vast majority significantly underperforming. Generally, during July regional prices have displayed similar discounts recorded last month.
After a number of strikes hitting output during June (- 3 GW year-on-year), French nuclear output has further deteriorated in July, hitting a low since at least 2012 and leading to a sharp contraction in French net exports and higher utilization of French gas units. The detection of an anomaly in the steam generators channel head is also contributing to undermine availability and will continue to do so in the upcoming months, as outages are likely being extended. In a PWR reactor design as for the EDF units, the replacement of the steam generator channel head can be done during a planned outage, typically lasting from one to three months, whereas a typical shutdown for refueling, which is carried out once a year, takes only 35 days. For the time being, for the units that are not offline and are being affected by this specific anomaly, a temporary solution is likely to be a steadier operation of the plants.
Stronger weather-driven power demands and an upward shift in natural gas forwards has boosted our coal burn expectations. This is offset in 2016 by increased coal production levels in the quarter just ended. In 2017, however, we are projecting growing tightness in the PRB, as a call on incremental coal supply may be challenging to meet.
Spot VLGC freight rates have plunged to new cycle lows below $24/MT on the benchmark Ras Tanura to Chiba, Japan, route. Freight rates on these vessels are now trading well below breakeven economics for even the most efficient operators. Rates look to continue to suffer for the foreseeable future as the trinity of peaking LPG trade, rising tonnage, and the expanded Panama Canal plagues these freight markets.
Manufacturing margins decrease the week ending July 15. RIN prices slide after peaking Monday.
The S&P 500 continued to push to new highs. Again, volatility declined and high yield debt prices rose. Emerging market debt prices, however, pulled back after having posted strong gains in the previous weeks. The dollar was generally stronger. The Turkish lira was noticeably weaker in the wake of the failed military coup. Commodities were mostly lower, both total, energy and ex-energy.
The situation in Libya shows no real improvement despite the recent swell of optimism over a near-term ramp in Libyan crude production. On July 7, Ibrahim Jathran, commander of the central Petroleum Facility Guards (PFG), announced exports would resume from the long-shuttered Es Sider and Ras Lanuf terminals within a week. The military push to clear ISIS out of the region near Sirte has also been making territorial gains. However, the announced merger of the two rival NOC’s seems to have broken down. PIRA acknowledges the possibility that terminals may reopen shortly. But in our view, the chaotic political and security situation could derail any production gains just as quickly. The UN-backed unity government (the GNA) has been unable to exert control, stark divisions remain between the rival governments and their affiliated militaries, and the myriad of militias on the ground will act in their own interests.
The 5th Circuit Court has decided that they (as opposed to the more EPA-friendly DC Circuit) are the appropriate venue to decide legal challenges to EPA’s TX Haze FIP that would have required costly scrubbers on 14 coal units. They also stayed implementation of the rule, offering a good preliminary sense that the Court has issues with EPA’s arguments and approach — as PIRA has been highlighting. This decision comes on the heels of EPA’s final One-Hour SO2 designations, where EPA declined to take action on four areas where Texas coal plants were proposed to be in Nonattainment, offering an environmental reprieve for coal/lignite units in Texas and pushing off any near to mid-term expectations of EPA-induced retirements.
Oil market rebalancing continues, but initial onshore stock decline has been less visible. India’s oil demand remains strong but with growth easing in 2H16 due to a heavy monsoon season and moderating economic growth. China’s net exports of gasoil, jet fuel and gasoline is set to increase by some 25% from last year. Asia embraces crude supply diversification with rising crude imports, but the share of Middle Eastern crude imports in the region is expected to remain high as Middle Eastern countries will strive to maintain market share. Asia-Pacific net crude imports are expected to rise in 4Q16 and 2017. Asian refinery margins are expected to stay modest due to high product inventories.
The strong move upwards in 1Q17 pricing is not just a story of NBP overreaching to the upside, but is a story of how the Continent is not. Spreads in the first quarter of next year have widened by over €1/MWh — meaning, the Continent is showing confidence that the U.K.’s tightness is a local story not a Continent-wide one. PIRA believes that this confidence is well-founded and will eventually lead to a significant move downward in winter pricing.
The coal market moved lower last week, on the back of weaker oil and gas prices and perhaps a hangover from the sizeable rally observed in the prior few weeks. The decline in pricing was particularly acute in the Atlantic Basin, while FOB Newcastle’s (Australia) price declines were more muted. With China’s import demand showing signs of strength, exacerbated by wet weather impeding production in some key areas, it is not surprising that FOB Newcastle prices have held up relative to API#2 and API#4. The weather-related disruption to China’s production (on top of the drive to rein in overcapacity) skews the risk to the upside for FOB Newcastle over the next 90 days.
Global equities moved higher on the week, with gains concentrated in the Americas, of which the U.S. and Brazil performed the best. In the U.S., the strongest sectors were retail and technology, while energy was the worst performer. Internationally, Latin America did the best, while China and BRICs also outperformed.
U.S. ethanol production jumps to an all-time high of 1,029 MB/D for the week ending July 15, breaking the previous record of 1,008 MB/D set last November. Inventories were slightly higher.
Latin American product demand is improving but is still down year-on-year. Consumption of the four main refined products trends higher in 2H16 but lag 2015 levels. PIRA forecasts that 3Q16 gasoline demand will be lower year-on-year but higher vs. 2Q16. Diesel demand in 3Q16 is expected to be below 3Q15 but higher than 2Q16. Regional refinery crude runs still disappoint with 3Q16 by ~70 MB/D lower than a year ago.
The tighter balances that have fueled price support in Asian and European spot markets are simply not sustainable. The less ramp-up that occurs in 2016, the more ramp will occur in 2017. The possibility of Asian supply reaching the Atlantic Basin in the year to come cannot be dismissed, particularly if Nigerian and Angolan production continue to run into operational problems. Length in Asia balances will easily front run any tightness in the Atlantic Basin. It will be more apparent when Qatari volumes begin to shift west.
Economic data out of the emerging world have turned stronger of late. Encouraging signals include: trade volumes turning positive on a year-on-year-basis; widespread improvements in industrial sector output; solid readings for vehicle sales; and constructive financial sector sentiments. In Europe, a preliminary July business confidence reading suggested that the Brexit decision has not yet disrupted economic activity. Next week’s economic calendar is filled with significant events.
The U.S. GHG Inventory shows 2014 emissions up year-on-year but down 7% vs. 2005. It does contain large write-ups to historic methane emissions from oil and gas production and landfills. Methane regulations for oil/gas and landfill sectors have been finalized, a draft technical report for the auto CAFE review has been published, and an endangerment finding for aviation and an international agreement on HFCs are expected later this year. The U.S., Canada and Mexico set a challenging regional goal of generating 50% of electricity from non-emitting resources by 2025. 2016 elections will impact the survival of the Clean Power Plan and the arc of climate policy for the next four years. PIRA revised our long-term federal carbon prices/costs expectations given the CPP stay.
Product demand strongly rebounded this past week, narrowing the product stock build, while crude stocks fell less than expected despite very high crude runs as imports stayed elevated. Light product imports were very high and these should substantially decline in next week’s data. Cushing crude stocks were up slightly and month to date are roughly flat and near our forecast. Another small build is expected next week. PIRA is forecasting continued strong light product demand for next week, which should cause major light product stocks to show a slight draw. Crude stocks decline sharply next week as runs stay high and imports back off.
PIRA does not expect autonomous vehicles (AVs) to have a meaningful impact on the oil, electricity demand or emissions outlooks over the next 20 years. Fully autonomous vehicles, which would allow the driver the flexibility to pursue other activities, are still likely at least a decade or more away from a technology standpoint. If and when this technology arrives, its impact on gasoline demand is not clear cut. If there is a synergy between AVs and electric vehicles (EVs) it could accelerate electrification of the fleet, for both cars and some trucks. It may also improve the fuel efficiency of the operation of vehicles. However, the impact on miles driven could very well be positive, particularly if there is substitution for some portion of train, plane or public transport travel.
Commercial gas production from the Jubilee field, which is processed at the Ghana National Gas Company’s gas processing plant at Atuabo raised the prospects of a price war in the supply of gas for power generation when it debuted on the market last year. However, the Atuabo gas is now one of the priciest in the world — even more expensive than its regional competitor from Nigeria, the West Africa Gas Pipeline Company (WAGP). This year it is estimated that the Atuabo gas price will remain uniform but that of the average annual delivery price of WAGP gas to Volta River Authority (VRA) will drop slightly.
Crude runs rose slightly on the week as maintenance continues winding down. Even so, capacity looks underutilized, which suggests discretionary run cuts are occurring. Crude imports fell to low levels and crude stocks drew. Finished product stocks also drew. Refining margins have remained poor with little barrel support other than fuel oil and naphtha cracks.
In assessing where the costs of oil are likely to head in the future, it is extremely important to distinguish trends from cycles. Historically, costs to operate existing oilfields and to develop new supplies correlate closely with oil prices. Using the Bureau of Labor Statistics (BLS) Drilling Oil & Gas Wells Index as a proxy for cost changes, our model predicts deflation may be about over with costs expected to increase in 2017 in line with an expected increase in oil prices. A similar cycle took place in 2008-2010, when prices collapsed in late 2008 and started to recover in mid-2009. The model also predicts continued increase in costs as prices continue to rise.
Policy developments over the past quarter were mixed. A federal judge ruled the Bureau of Land Management (BLM) overstepped its authority in its proposed fracking regulation on federal/Indian lands. The Colorado Supreme Court decided that municipalities can’t ban fracking. The North Yorkshire council approved a permit to frack a well in the United Kingdom. On the other hand, the EPA issued new methane standards although implementation costs are expected to be non-material, Pennsylvania passed sweeping new oil and gas rules, and the EPA’s SAB has decided its draft study that concluded fracking causes no systemic adverse impacts on drinking water needs quantification. Going forward, we expect limited federal policy changes as the current administration comes to an end and a continuation of generally favorable state policies, particularly with the sector financially struggling.
Deferred futures are currently below long-run equilibrium levels because producers are under pressure from their bankers to hedge future production. To search out speculative interest for this supply of paper futures, producers are selling future production below long-run equilibrium values. As long as this forced selling persists, the burden of raising deferred futures will fall on speculators. As the balances tighten and surplus stocks are drawn down, there will be an increase in speculators' expectations and confidence that higher prices are justified. Backwardation will likely increase, although the back of the market will go up as well. This will continue until a long-run equilibrium between demand and supply is reached.
The information above is part of PIRA Energy Group's weekly Energy Market Recap - which alerts readers to PIRA’s current analysis of energy markets around the world as well as the key economic and political factors driving those markets.
Historically, Gazprom has monopolized all gas exports in Russia. Complete control over gas sales to both east and west did not incentivize Gazprom to explore new ventures in LNG projects. Instead, the company focused on the development of a conventional pipeline network – including the Nord Stream, South Stream and East Siberia-Pacific Ocean pipelines. Consequently – in terms of the LNG market – Russia is lagging behind other global gas producers, such as Australia or Qatar who have heavily invested in infrastructure over the past decade.
Given Russia’s extensive gas reserves, the country has the potential to be a leading LNG exporter. Recent landmark changes to the country’s operating environment may finally allow for this potential to be realized – with amendments to gas export law expected to challenge Gazprom’s gas monopoly. Russia’s oil & gas production giant Rosneft, as well as country’s largest independent gas producer, Novatek, have gained licenses to export LNG independently from Gazprom and are pushing projects forward.
Novatek’s Yamal development is a key example, prospects here have been boosted by both a financial injection from China (3.6bn EUR) and changes in the Russian gas export landscape. The project is a potential game changer for gas export and is expected to come onstream by 2018 with three (5.5 mmtp) trains.
DW expects both LNG and pipeline exports from Russia to Asia to increase significantly in the mid to long term as the country reduces its reliance on pipeline gas exports to Europe. Growing demand for natural gas in Asia will likely incentivize Russian players to continue to invest in liquefaction for export. Novatek has recently announced plans for new Arctic LNG plants to expand production in the region, with a second plant in the Gydan Peninsula.
With these new projects, Russia is positioning itself to be a serious competitor to leading LNG producers. The country’s vast gas reserves and geostrategic position place Russia in a unique position to meet the growing demand for gas in both Eastern and Western hemispheres.
Iva Brkic, Douglas-Westwood London
BP announced on July 14, that following significant progress in resolving outstanding claims arising from the 2010 Deepwater Horizon accident and oil spill, it can now reliably estimate all of its remaining material liabilities in connection with the incident.
As a result, taking into account this estimate together with other positive tax adjustments, BP expects to take an after-tax non-operating charge of around $2.5 billion in its second quarter 2016 results.
This charge is expected to include a pre-tax non-operating charge associated with the oil spill of around $5.2 billion. This would bring the total cumulative pre-tax charge relating to the Deepwater Horizon incident to $61.6 billion or $44.0 billion after tax.
BP believes that any further outstanding Deepwater Horizon-related claims not covered by this additional charge will not have a material impact on the Group’s financial performance. It will deal with remaining claims in the ordinary course of business.
Brian Gilvary, BP chief financial officer said: “Over the past few months we’ve made significant progress resolving outstanding Deepwater Horizon claims and today we can estimate all the material liabilities remaining from the incident. Importantly, we have a clear plan for managing these costs and it provides our investors with certainty going forward.”
Gilvary reconfirmed that BP expects to continue to use proceeds of divestments to meet Deepwater Horizon commitments in line with the financial framework laid out in previous quarters.
A year ago, BP reached agreements to settle outstanding federal, state and local government claims arising from Deepwater Horizon. In the months since, BP has made much further progress in resolving outstanding claims arising from the incident.
PSC settlement - the Court and the Deepwater Horizon Court Supervised Settlement Program have been progressing the remaining economic and property damage claims relating to the 2012 Plaintiffs’ Steering Committee (PSC) settlement, including through simplified and accelerated procedures for processing certain claims. Today’s announced charge includes the estimated cost of settling all outstanding business and economic loss claims under that settlement, which are expected to be paid by 2019.
Opt-out and excluded claims - there has also been significant progress in resolving economic loss and property damage claims from individuals and businesses that either opted out of the PSC settlement and/or were excluded from that settlement. In February 2016, the US federal district court estimated that there were more than 85,000 valid opt-out and excluded economic loss plaintiffs. The vast majority of these claims have since been settled or dismissed as an order of the court today confirms. An estimate of the cost of the remaining claims, expected to be paid by the end of 2016, is also included in this charge.
Securities litigation - in June, BP announced a $175 million settlement of claims from a class of post-explosion ADS purchasers in the MDL 2185 securities litigation, payable during 2016 - 2017. This cost is also included in today’s announced charge.
Disappointing EIA DataThe large product stock build added to the market’s worry about excess light product stocks undermining crude demand and ultimately reducing the size of crude stock declines. While PIRA sees crude stock declines accelerating onshore U.S., with this week’s EIA data showing 630 MB/D stock decline, the market is, not surprisingly, skeptical given recent EIA reports and the crude weakness in Northwest Europe and Asia. Oil markets are stuck in a $43-$53/Bbl trading range, and visiting the lower end on occasion is to be expected, especially with lots of fear and data like the July 13 EIA report.
The market is having second thoughts about the industry’s ability to cope with surplus supply despite the atypical heat expected to persist well into the second half of July, as suggested by NYMEX futures brief expedition to ~$3.00/MMBtu and subsequent V-shape reversal back towards ~$2.70/MMBtu. Thursday’s relatively flat price action following a neutral-to-consensus stock build further reinforced the market’s at least temporary hesitation to push prices back toward those July highs. Indeed, weather forecasts and projected seasonal restocking in July certainly appear favorable to sentiment; a post-summer acceleration in refills has called into question the viability of $3.00/MMBtu gas during the upcoming shoulder season.
U.K. winter power prices have jumped in response to the recent tumultuous development in NBP prices, but spark spreads have softened in the past 10 days or so, in spite of the latest Winter Outlook by National Grid confirming that the power market will remain exceptionally tight.
Coal prices shot up last week, with all three major forwards tacking on $3.00/mt or more across the curve. Higher oil pricing, more positive signals coming out regarding Chinese coal demand, and stronger European gas prices all factored into the strength in coal pricing last week. FOB Newcastle (Australia) prices rose by the greatest extent, perhaps due to increased buying activity out of China and weather-induced cuts to Indonesian exports. PIRA would not be surprised if the rally in pricing starts to fade, as additional support on the fundamentals side will be needed to keep prices on an upward trajectory.
Near-term EU ETS fundamentals are poor, but no worse than they were before the Brexit vote. EUA prices rebounded after the January 2016 price decline (which was far more severe) and could do the same now. Auction demand data from June was somewhat positive, and there is historically a price bump in August, when auction volumes are lower. Also, the currency impact from the Brexit vote results in lower compliance costs for U.K. coal-fired generators, potentially supporting emissions demand. However, there is increased market uncertainty.
Chinese economic data for the second quarter surprised on the upside — GDP growth came in above expectations; the manufacturing sector appeared to be picking up steam; consumer spending expanded solidly; and the housing sector remained red-hot. Data on total social financing and local government debt indicated that policy makers have maintained an easy stance on credit creation. In the U.S., growth in consumer spending accelerated in a major way during the second quarter, but other sectors were more subdued. Industrial production disappointed, though capital-intensive manufacturing industries reported encouraging results. The latest inflation data did not set off an alarm bell.
Asian LPG prices were lower last week, with front-of-the-curve contango spreads flattening, indicating that markets are less optimistic of autumn price gains than they had been previously. Cash continues to trade at a significant discount to paper, with August physical Far Eastern propane being called near $310/MT, some $15 below futures. Butane continues to trade narrowly above C3, ending this week at just $14/MT above propane — the tightest premium thus far this year.
Manufacturing margins reach 18-month peak. RIN values soar.
Traders inherently love this sort of volatility, but it’s plainly obvious that these moves, overnight especially, have many backing away. This should continue to be the case in corn until early August, when pollination is close to being finished. For beans, we expect the volatility to continue until at least the end of August as late-August/early-September moisture will make or break this year’s crop. PIRA always believes that fundamentals will win out, but it’s going to be a long and wild ride until true fundamentals take over once again.
Crude runs rose again on the week as maintenance continues winding down. Crude imports eased slightly, but crude stocks still built 0.3 MMBbls. Finished product stocks built 2.1 MMBbls, with increases in all the products other than gasoil and fuel oil. Refining margins have remained poor with little barrel support other than fuel oil and naphtha.
Last week’s regional election in Japan brought to power a decidedly anti-nuclear governor in the very region that houses the only two operating nuclear power reactors in Japan, reigniting questions as to the future of Japanese nuclear power generation. While this development is a decidedly bullish one for Japanese LNG imports, it is unlikely that even a completely nuclear-free Japan will result in a resurrection of Japanese gas demand for power generation.
With the release of the report to the French minister Ségolène Royal on "Proposals for the Carbon Price," together with the Minister's press release of July 11, the French domestic carbon floor is now shaping up as a tax on coal. Assuming the policy starts from Jan. 1, 2017, which is looking optimistic, French 1Q 2017 baseload contract is well priced in the mid €30/MWh and the 2017 annual baseload contract is well priced in proximity of €32/MWh, or €2/MWh below our latest outlook, in line with current market quotes. In the medium term, the decision to penalize the coal units poses risks of earlier coal closures, making the French system more vulnerable during the winter months (similar to the U.K.). In addition, the revised policy still leaves unsolved the longer-term issue of the needed investments in EDF's existing nuclear units.
Draft amendments include a tightening of the cap post-2020, adjustments to the Price Containment Reserve and provisions for unsold allowances — and do not appear to send overly ambitious market signals. After 2020, the Price Containment set-asides are smaller, leaving more of the cap readily available to sources. The high single price tier for Reserve allowances demonstrates that CARB does not expect it to be a factor in regular pricing. The proposal to move unsold allowances to the Price Containment Reserve takes into account the quantitative limits on their return to auction. Quebec is, and Ontario soon will be, a partner in this market, and California policies are looking to serve the broader market.
The S&P 500 set a new record on the week. The strongest gains were posted by the banking index, along with materials, while the “growth” indicator far surpassed the “defensive indicator." Only the defensively oriented utilities tracking index declined on the week. Internationally, all the tracking indices advanced, with Latin America, emerging markets, emerging Asia, China and BRICs all out surpassing the gains seen in the U.S.
Inventories draw, decreasing in four of five PADDs, but there was a large build in PADD I. Output of ethanol blended gasoline dipped to the lowest level in a month.
After jumping 17%, to 32% last week, corn silking should increase at least that amount again for the week ending Sunday, July 17th. The heat is on this week, but the percentage released this afternoon should have pollinated in fairly benign temperatures in the "I" states and Minnesota, according to mean deviation statistics for the first half of the month.
Recent press reports suggesting that bolt failures could cause significant production shutdowns appear to be overstated. There have been a number of failures of bolts that are used to connect blowout preventers, risers, and other subsea equipment in the Gulf of Mexico since 2003. A task force, with representatives from the U.S. Bureau of Safety and Environmental Enforcement (BSEE), API, oil industry and manufacturing companies, is currently reviewing the root causes of the failures and developing a strategy to fix the existing problems. For producing platforms/structures, fixing the problem may require shutting in production for several days to replace the defective bolts. However, it appears at this time that the issue affects primarily drilling operations and to a much lesser extent existing production.
Both the Netherlands and the U.K. are shifting toward market balancing that will rely more on higher seasonal imports and working gas storage. As of now, the way these two markets are managing this inherently riskier position could not be more different. Operating problems in U.K. storage at Rough have created a vast winter risk premium, so vast that PIRA has a difficult time seeing it sustained on an outturn basis. The U.K. will certainly need to rely on more Continental, Norwegian, and LNG supply this winter. As we have emphasized in past years, the U.K. counting on Continental storage to balance some of its peak needs is often at odds with the mandate of Continental storage owners to place the home market as a greater priority no matter how full storage may be. This risk has been particularly egregious in the fourth quarter, given the Continent’s tendency to hoard storage volumes just in case the first quarter produces colder-than-normal weather. Add in real and perceived Brexit fallout and one has to assume the risks to the U.K. are somewhat greater.
Following temperatures and gas markets higher, June on-peak energy prices rose month-on-month in nearly every market in the Eastern Interconnect and ERCOT. Gas prices continued to rise through late June with Henry Hub spot topping the $2.90 mark as the July NYMEX contract expired. Eastern coal prices have also seen a modest advance, but western markets remain weak with supply rebounding. A gas price recovery over the balance of 2016 also implies that heat rates will likely struggle to keep pace with the high levels set in 2015. First half of 2017 is also likely to have lower gas burn and heat rates year-on-year in most markets.
In our 2016 Reference Case, PIRA increased its projections for BEV market growth which reflects greater progress in battery development. In this report PIRA analyzes lithium-ion batteries and examines lithium and cobalt, the raw materials crucial to lithium-ion battery production, and find that in the near term, supply shortages for lithium are possible, but long-term supply for lithium should be available at reasonable prices. Cobalt supply is more difficult to predict, but it appears more likely to be volatile than lithium in both the short term and the long term. Overall, PIRA’s expected EV market penetration rate should not be hindered by a lack of raw materials used in battery production.
Riding on continued efficiency gains and modestly improved prices, producers in Canada grew output by 4% quarter-on-quarter, or ~550 BCF in 1Q16. Production gains were strongest in Alberta and British Columbia; the former reached highs not seen since 2010, and the latter set new records in quarterly volumes. Both the companies within and outside of the surveyed “PIRA Group” grew production, although this quarter, the non-group significantly outpaced the survey group.
The S&P 500 set a new record high. Again, volatility declined and emerging market debt prices rose sharply. Financial stress continued to lessen post-Brexit. The dollar was mixed on the week.
Britain's shale gas industry could get a helping hand from a falling pound and a supportive new prime minister just as it is gearing up for its first production this year, after facing economic and political challenges that slowed its start. The British pound's weakness since the Brexit vote has made it more expensive to import gas, helping the case for shale gas, which had been hurt in the past by weak oil prices and by opposition to planning approval from local campaigners.
The information above is part of PIRA Energy Group's weekly Energy Market Recap - which alerts readers to PIRA’s current analysis of energy markets around the world as well as the key economic and political factors driving those markets.
Offshore Source keeps you updated with relevant information concerning the Offshore Energy Sector.
Any views or opinions represented on this website belong solely to the author and do not represent those of the people, institutions or organizations that Offshore Source or collaborators may or may not have been associated with in a professional or personal capacity, unless explicitly stated.