Europe Eyes Flexible Storage Goals After Cold Snap Squeeze

Europe’s natural gas prices have declined in recent weeks after hitting a two-year high in February, easing concerns about the price Europe will have to pay this summer to prepare for the next winter.

Dutch TTF Natural Gas Futures, the benchmark for Europe’s gas trading, hit a two-year high in the middle of February amid the first proper winter with prolonged periods of cold snaps since the 2022 energy crisis.

Prices have retreated since mid-February as the heating season and winter are coming to an end, and solar and wind power generation is picking up to regain some share of the European power generation mix, following prolonged periods of wind speed lulls and little sunshine in Europe during the winter.

The recent decline in natural gas prices in Europe could also offer some relief to power prices, which have remained high this winter on the back of the high natural gas price.

Europe’s energy-intensive industry, however, continues to suffer from the high energy prices and calls for additional measures to address the high energy costs, which put the European industry at a disadvantage.

The first proper winter in Europe, with prolonged periods of cold snaps since the 2022 energy crisis, depleted the EU stockpiles of natural gas.

As a result, European prices rallied by mid-February, and concerns emerged about the need for much more additional LNG supply to make its way to Europe to help with the storage refill before the next winter begins.

But prices have eased over the past few weeks, as talks began on a potential Russia-Ukraine ceasefire and as the winter in the northern hemisphere is coming to an end. The EU leaders are also discussing making the EU targets for gas storage refill by November 1 more flexible, which could ease some of the concerns about the pace of refills from April onwards.

A group of EU member states, including the biggest economies Germany and France, are reportedly arguing that to avoid price spikes and market speculation, the bloc should allow more flexibility in its currently binding 90% full-storage target by November 1 each year.  

In the wake of the 2022 Russian invasion of Ukraine and the halt to Russian pipeline gas supply to most EU countries, the European Commission adopted a target for EU natural gas storage levels to be 90% full by November 1 of each year.

However, this rigid November 1 target has created problems for many market players. Policymakers in countries including Germany, Italy, and the Netherlands are concerned that the current high forward gas prices for the summer months would make it unprofitable for gas companies and marketers to store gas.

With EU storage depleted at the fastest pace in seven years after a cold winter, the summer refill season presents several challenges in availability, prices, and the money that Europe will have to spend on additional LNG.

At a meeting last week, some EU energy ministers “mentioned the need for flexibility as regards the proposed gas storage regulation, which is currently being discussed, as well as for a rigorous impact assessment of the rules,” the EU said.

Despite the possible easing of the refill targets, the gas market will remain tight in the coming months, Moutaz Altaghlibi, senior energy economist at ABN AMRO Bank, said last week.

Geopolitics, including U.S. tariff and trade policy and the Russia-Ukraine peace talks, will continue to be the main driver of volatility, ABN AMRO reckons.

“At the same time, the market will be watchful of the speed of storage refill, while it remains responsive to factors affecting demand in Europe or key LNG competitors in Asia, such as adverse weather conditions, along with any supply disruptions from key suppliers such Norway or the US,” Altaghlibi noted.

The first proper winter in Europe, with prolonged periods of cold snaps since the 2022 energy crisis, depleted the EU stockpiles of natural gas.

As a result, European prices rallied by mid-February, and concerns emerged about the need for much more additional LNG supply to make its way to Europe to help with the storage refill before the next winter begins.

But prices have eased over the past few weeks, as talks began on a potential Russia-Ukraine ceasefire and as the winter in the northern hemisphere is coming to an end. The EU leaders are also discussing making the EU targets for gas storage refill by November 1 more flexible, which could ease some of the concerns about the pace of refills from April onwards.

A group of EU member states, including the biggest economies Germany and France, are reportedly arguing that to avoid price spikes and market speculation, the bloc should allow more flexibility in its currently binding 90% full-storage target by November 1 each year.  }

In the wake of the 2022 Russian invasion of Ukraine and the halt to Russian pipeline gas supply to most EU countries, the European Commission adopted a target for EU natural gas storage levels to be 90% full by November 1 of each year.

However, this rigid November 1 target has created problems for many market players. Policymakers in countries including Germany, Italy, and the Netherlands are concerned that the current high forward gas prices for the summer months would make it unprofitable for gas companies and marketers to store gas.

With EU storage depleted at the fastest pace in seven years after a cold winter, the summer refill season presents several challenges in availability, prices, and the money that Europe will have to spend on additional LNG.

At a meeting last week, some EU energy ministers “mentioned the need for flexibility as regards the proposed gas storage regulation, which is currently being discussed, as well as for a rigorous impact assessment of the rules,” the EU said.

Despite the possible easing of the refill targets, the gas market will remain tight in the coming months, Moutaz Altaghlibi, senior energy economist at ABN AMRO Bank, said last week.

By Tsvetana Paraskova – Mar 24, 2025.

The Future of Valve Manufacturing is Already Here

Companies in the valve and control products industry are responding to a confluence of forces that are changing the landscape of manufacturing — automation, agility and digitalization to name a few.

Kevin Tinsley shares a commonly held fear in the manufacturing industry. “My nightmare is getting the phone call that somebody got hurt in our facility,” said Tinsley, senior vice president of Nele Global Operations. The company recently mitigated some of the risk by combining artificial intelligence (AI) and robotics to perform high-pressure testing of its valves. 

“High-pressure testing of valves can be dangerous if there is a casting or design failure,” said Tinsley. “We utilize robots equipped with cameras, as well as sniffing devices, to detect valve leakages. They can be programmed to perform this task effectively and—most importantly—safely.”

Neles partnered with an outside expert to design and build an explosion-proof enclosure, then purchased an OMRON Collaborative Robot and developed a sniffing program with the industrial automation company for high-pressure testing, such as helium tests. “It’s a great advancement in technology,” said Tinsley.

New technologies, such as robotics, are changing the face of manufacturing. In a survey of small and medium-sized manufacturers released in February by The Manufacturing Institute and BKD, more than 77% of respondents indicated they were making technological investments to achieve cost efficiencies in the production process, with 73.4% doing so to improve operational performance. And increasing automation is just one of a wide array of trends shaping the future of manufacturing.

FORCES OF CHANGE

“I see several forces driving changes in manufacturing,” said Tony Scacchitti, operations manager for AUMA Actuators Inc. “One obvious one is advance- ments in technology, but another is customer expectations. People want things more quickly, and they have quality and cost expectations. From year-to-year, those three expectations vary depending on the market. But they drive change.”

Another factor that affects manufacturing is the role of federal, state and local government. “Government intervention is forcing more sourcing of local content to meet new regulations and avoid costly tariffs,” said Tinsley. “Countries are looking to create manufacturing jobs and driving legislation to block pure imports.”

Manufacturing jobs—and finding qualified people to fill them—are also at the forefront of conversations about the industry’s future. “The demographics of our workforce are contributing to change,” said Bill Metz, vice president of operations and engineering for Richards Industrials. “We have a lot of people looking at retirement in the next four to 10 years and not enough young people coming into the business.”

Workforce challenges, technological advancements, customer demands, the regulatory landscape and more are leading manufacturers in the valve and control products industry to adapt. In this article, we’ll take a closer look at movements in three main areas: agile manufacturing, automation and digitalization.

A QUEST FOR AGILITY

Manufacturers are increasingly embracing agile manufacturing to enhance their operations. Encompassing a broad range of strategies and tools, agile manufacturing is a methodology that stresses the importance of responding quickly to customer needs and unexpected changes in the marketplace. Agility is becoming a hallmark of successful manufacturing facilities and will continue to do so in the future.

When Scacchitti joined AUMA Actuators nearly a decade ago, the standard lead time for orders was six to eight weeks. When the company expanded into the oil and gas market, it had to make changes to meet that niche’s two- to three-week delivery expectations.

“We wholeheartedly embraced a made-to-order system and eliminated all batch processes in assembly areas,” said Scacchitti. “We had to realign our shop floor, move equipment and change our product and process flow.” Among the changes AUMA made recently was to eliminate the purchase of pre-assembled motors from its parent company in Germany and bring the assembly inhouse to turn products around faster.

By using a made-to-order system, Scacchitti said the company has decreased its lead times up to 270%. AUMA has also reduced waste. “With batch processing, you’re making com- ponents ahead of time. Materials may become obsolete or get recalled, so you end up with a lot of wasted products you can’t use,” he said.

A focus on cross-training helps Richards Industrials remain agile. “Almost all of our employees can do multiple tasks on multiple machines,” said Metz. “You can move them where the work is rather than moving the work to where they are. We have that flexibility throughout our machining and assembly areas.”

At Neles, shortened lead times are often driven by customers who are completing engineering work at the same time the supplier of flow control solutions is processing the purchase order. “This requires us to react quickly to changes to their purchase order and still try to keep their original promise date,” said Tinsley. One of the ways the company stays on track is by using a workflow system that records, tracks and reminds individuals of their to-do lists and due dates. A second tactic is the delayed differentiation strategy, which occurs on the production side.

“For certain industry segments, we produce a family of products that can later be differentiated into a specific end product, thereby reducing lead times,” said Tinsley. “We use a variety of strategies, from subassemblies stocked on the shelf to components that can be transformed into many different end-use items.”

ADVANCES IN AUTOMATION

A record 2.7 million industrial robots work in factories around the world, according to the International Federation of Robotics’ World Robotics Report 2020. That represents a worldwide increase of approximately 85% between 2014 and 2019. Despite the jump, the move to robotics and other automated systems isn’t a simple decision—or undertaking.

While Richards Industrials is investing in automation, Metz admits it’s challenging for the company because it has a high mix of products that it produces in low volumes. “Automation can help us, but it’s much more difficult to do compared to a high-volume, low-mix environment,” he said. One area where automation makes sense is machining to help minimize changeover and setup.

In addition to using robotic arms for high-pressure testing, Neles also relies on them for measuring and data mining of critical valve dimensions. Advancements have moved the task from coordinated measuring machines housed in a control area to robotic measuring arm equipment on the manufacturing floor. The company has several Hexagon Romer Absolute Arms in its Massachusetts facility to validate critical parts.

“In the past, measuring all these parts was so time-consuming. We had almost a ‘hope strategy’—build it, take it apart, try something new, repeat,” said Tinsley. “Now we are trying to be more scientific. Collected data is compared to our drawing and historical data. We then run 3D models to see if we could have a stack-up dimension issue. This eliminates wasted valve assembly capacity, rework and damaging essential parts.”

Neles also developed a machine for lifting and turning large valves—some the size of cars—that Tinsley said resembles a PAC-MAN character. “We stick the valves in the jaws of the PAC-MAN, squeeze it down, and the machine turns it over,” he said. “So we avoid using chains and cranes and lifting with people underneath the valves.” It’s a win-win, increasing both efficiency and safety.

A COMMITMENT TO DIGITALIZATION

Like agile manufacturing and automation, digitalization can take on many forms. Simply put, it refers to the use of digital technologies to change busi- ness processes and models. Two of the tools gaining buzz recently throughout manufacturing are virtual/augmented reality and digital twinning, which means to create a virtual representation of a component, product or process to run simulations before it’s deployed. But they aren’t the only digital technologies impacting industry.

Last year, Richards Industrials won the Manufacturing Leadership Award from the National Association of Manufacturers for innovating the company’s shop floor with FORCAM’s manufacturing execution systems (MES) software. MES packages collect and analyze data on the status of equipment and tools, personnel availability, material buffer to potential bottlenecks, such as tool changes or equipment downtime due to delays in receiving materials. The company uses the information to “dig a little deeper and find opportunities to make changes in the process,” said Metz.

AUMA Actuators has completely digitized all functional testing requirements for its products, which are configured to meet each customer’s specific needs for movement, speed, torque and other requirements. The company digitized data from nearly 3 million customer drawings. The data now runs through a computer system, and products are tested on custom-built testing stations. “You plug in the electrical actuator, pick the job number and the system pulls up pre-digitized functional testing for that order,” said Scacchitti. “You push a button, and when the testing is done it tells you what’s working or what’s wrong.”

Neles has invested in advanced planning software to connect supply and demand data from all its factories, which helps resolve one of the key supply management issues in the valve industry—part forecasting. The large number of markets, applications and variants in product lines creates erratic tial for inventory buildup on site while having shortages in another facility,” he said.

PLANNING FOR CHANGE

It’s a challenge for manufacturing companies to keep an eye on daily business while also forecasting where the industry is headed. To remain up to date, Neles Global Operations relies on internal talent, help from its parent company and collaborations with external experts.

“The valve industry is a small niche. It isn’t as lucrative for technology developers as other industries,” said Tinsley. “Most of our ideas for new technologies come from in-house, then we go out, search for a partner and get them interested. It takes a lot of internal development, then strategic partnerships with others.”

New technologies are just the tip of the iceberg. Companies must make decisions about offshoring versus onshoring, supply chain management, fulfillment strategies, material advancements—the list goes on and on.

“Change is inevitable,” said Scacchitti. “And in manufacturing, change is necessary to remain competitive.”

By: Susan Keen Flynn, Valvemagazine /  03/28/2025.

Enbridge to Invest $1.39 Billion until 2028 in Mainline Pipeline

Enbridge Inc. has earmarked an investment of up to CAD 2 billion ($1.39 billion) until 2028 for a Canada-United States liquids pipeline with a capacity of about 3 million barrels a day of crude oil.

That will be spent on “further enhancing and sustaining reliability and efficiency aimed at ensuring the Mainline system continues to operate safely and at full capacity to support maximum throughput for years to come”, the Calgary, Canada-based energy transporter and gas utility said in an online statement.

Mainline, which started service seven decades ago and has grown to be Canada’s biggest crude conveyor, carries production from the Canadian province of Alberta to eastern Canada and the U.S. Midwest. Besides petroleum, it also transports refined products and natural gas liquids. Mainline stretches nearly 8,600 miles, according to Enbridge.

The optimization will “support the growing need for ratable egress out of Alberta”, said chief executive Greg Ebel.

Enbridge also announced additional investments in two pipelines: CAD 400 million for the BC Pipeline and CAD 100 million for the T15 project.

The investment for the BC Pipeline is for the Birch Grove project under the pipeline’s T-North section. Expected to raise the BC Pipeline’s capacity by 179 million cubic feet per day to about 3.7 billion cubic feet a day by 2028, the Birch Grove project will provide additional egress for gas producers in northeastern British Columbia to access markets for their growing production, driven by the Montney formation.

The investment for T15 phase 2 is meant for the installment of additional compression to double the original pipeline’s capacity. Expected to go onstream 2027, the expanded pipeline will deliver around 510 million cubic feet a day of natural gas to Duke Energy Corp.’s Roxboro plant in North Carolina as it transitions from coal to gas-fired generation.

The investments come despite President Donald Trump imposing tariffs on Canada, including for its energy exports. Most Canadian products, as well as Mexican products, entering the U.S. will bear a 25 percent tariff while Canadian energy will have a lower rate of 10 percent. The tariffs apply to goods that do not qualify for preference under the three countries’ trade agreement, according to information published online by the White House.

According to the presidential house, the move is in response to Canada- and Mexico-based trafficking of drugs into the U.S. and illegal migration from Mexico. The tariffs stay “until the crisis is alleviated”, the White House said in a statement February 1.

Ebel said, “In combination with the $8 billion [CAD] of projects we sanctioned in 2024, Enbridge’s secured growth now sits at $29 billion [CAD]”.

“We expect to place approximately $23 billion [CAD] of that secured backlog into service through 2027 and the remainder is slated to enter service through 2029”, Ebel added.

“Enbridge will continue to be disciplined as we continuously high-grade our $50 billion [CAD] opportunity set through the end of the decade. Rigorous investment criteria, including project-specific hurdle rates and low-risk commercial models, allow us to capture strong risk-adjusted returns and maximize value for our investors.

“Looking ahead, we’ll maintain our capital discipline and financial flexibility. Our long-held target debt-to-EBITDA range of 4.5x to 5.0x remains the sweet spot for Enbridge and our steadily growing business can equity self-fund $9-$10 billion [CAD] of annual growth capital”.

By: Rigzone / March 10, 2025

Indonesia Bets Big on Oil With $12.5 Billion Refinery Gamble

Indonesia is going all-in on oil with a massive $12.5 billion refinery project, aiming to cut imports, boost energy security, and flex some refining muscle. The government announced plans for the 531,500-barrel-per-day facility, making it one of the largest in the region—because when you’re an economy growing as fast as Indonesia’s, relying on imports just isn’t cutting it anymore.

“We will build a refinery that, In shaa Allah, will have a capacity of approximately 500,000 barrels,” Energy Minister Bahlil Lahadalia said, signaling Jakarta’s renewed commitment to domestic refining. The move reflects President Prabowo Subianto’s aggressive push for energy self-sufficiency–a priority for a country that once exported crude but now finds itself importing increasing volumes to meet demand.

The plan, funded in part by Indonesia’s Daya Anagata Nusantara Investment Management Agency (Danantara), is expected to save the country up to 182.5 million barrels of oil per year—a reduction in imports that could translate to a whopping $16.7 billion in savings. The bold pivot away from dependency is a logical step to take amid global markets that have been rattled by trade wars, shifting OPEC+ production strategies, and unpredictable crude prices.

The refinery’s construction isn’t just an energy play—it’s an employment machine. Officials estimate 63,000 direct jobs and another 315,000 indirect jobs will be created, making this more than just an oil story—it’s a political win. The government’s 2025 priority list includes 21 downstream energy projects worth $40 billion, with this refinery taking center stage.

Meanwhile, Indonesia is still struggling with declining oil production, having slipped from a peak of 1.6 million barrels per day in the 1990s to under 600,000 bpd today. The country has courted ExxonMobil to boost output, but for now, its best bet is to refine what crude it does produce and cut down on costly imports.

By: Oil Price, March 07, 205.

Saudi Aramco CEO says Chinese market is ‘crucial’

RIYADH – Amin Nasser, president and CEO of Saudi Arabia’s oil giant Saudi Aramco, has said that the Chinese market is critically important to the company.

The company is continuously deepening cooperation with China, particularly through increased investments in the petrochemical and new energy sectors, Nasser said during a recent telephone press conference on the company’s 2024 earnings.

Calling China a key market for Saudi Aramco’s crude oil exports, Nasser said China is also a crucial partner in the company’s petrochemical strategy.

“We see China’s refining and petrochemical industry, especially in petrochemicals, as having reached world-leading standards, providing significant cooperation opportunities for Saudi Aramco,” he said.

Regarding investment plans, Nasser confirmed that Saudi Aramco is actively progressing with several major investments in China, all of which are advancing smoothly. Additionally, the company is enhancing strategic cooperation with Chinese enterprises such as Sinopec, exploring more joint investment opportunities.

“The Chinese market and Chinese partners will continue to play a central role in Saudi Aramco’s global strategy. We look forward to collaborating with more Chinese partners to achieve mutual growth,” he said. 

By Xinhua / March 8, 2025.

Crude Stockpiles Rise, But Gasoline and Distillates See Big Draws

Crude oil inventories in the United States saw an increase of 1.4 million barrels during the week ending March 7, according to new data from the U.S. Energy Information Administration released on Wednesday.

Crude oil prices were trading up prior to the crude data release by the U.S. Energy Information Administration, rebounding from a slide earlier in the week, even after the American Petroleum Institute (API) reported on Tuesday a build of 4.247 million barrels in U.S. crude oil inventories amid strong product draws. The Brent benchmark was trading up 1.32% at 10:20 a.m. ET at $70.48 —a $1 per barrel increase over this time last week. The WTI benchmark, meanwhile, was trading up 1.55% at $67.28—a gain of just under $1 per barrel from last week’s level.

For total motor gasoline, the EIA estimated that inventories decreased by 5.7 million barrels for the week to March 7, with production averaging 9.6 million barrels daily. This compares with an inventory decrease of 1.4 million barrels for the previous week and an average daily production of 9.6 million barrels daily.

For middle distillates, the EIA estimated another inventory decrease, this time of 1.6 million barrels, with production dropping to an average of 4.5 million barrels daily. This compares to an inventory dip of 1.3 million barrels in the week prior, when production stood at a more robust average of 5.2 million barrels daily. The inventory slide is in line with seasonal norms and is now 5% below the five-year average for this time of year.

Total products supplied over the last four weeks were up week over week, averaging 20.7 million barrels per day—a 3.9% increase over this time last year. Distillate products supplied over the last four weeks are up 9.5% compared to this time last year, while gasoline products supplied were up 0.1% from the same period last year.

By Julianne Geiger for Oilprice.com Mar 12, 2025

Vopak & Neste Deliver Renewable Diesel in Singapore

The first supply of Neste’s renewable diesel has been delivered to the Singapore Cruise Terminal by a tanker operated by Global Energy. The fuel was sourced from Vopak’s Penjuru Terminal, following a strategic partnership between Neste and Vopak to support Singapore’s sustainable fuel development.

Ee Pin Lee, head of commercial APAC, renewable products at Neste, says: ‘This first supply of Neste MY Renewable Diesel to the maritime sector in Singapore is a significant milestone; and demonstrates the versatility of the drop-in product across a wide range of applications where it can replace fossil diesel. It is an effective decarbonisation solution for enabling the maritime sector to be more sustainable and this collaboration sends a clear signal of our commitment to Singapore and the Asia Pacific region. Neste is the world’s leading producer of sustainable aviation fuel and renewable diesel.’

Neeraj Kumar, VP of commercial chemicals & business development new energies for Vopak’s Singapore business unit adds: ‘We greatly value our partnership and collaboration with Neste. Together, we are enabling our customers to leverage our expansive network, advanced infrastructure solutions, and unwavering commitment to safety. We are proud to contribute to the regional and global shift toward more sustainable energy and feedstocks, driving innovation and sustainability in the marine sector. Together with our customers and partners we help the world flow forward.’

By: Tank Storage Magazine / March 06, 205

Refinery Shutdowns, Growing Demand Could Send Fuel Inventories to 25-year Low

Refinery closures combined with growing demand for gasoline, diesel, and jet fuel are about to start squeezing available volumes—and this squeeze is about to become marked next year. That’s according to the Energy Information Administration, which warned this would plunge inventories to the lowest levels since 2000.

Two refineries are set to shut down this year, the EIA said in the latest edition of its monthly Short-Term Energy Outlook. One is in Houston, and the other in Los Angeles. The Houston facility, owned by LyondellBasell, which has already begun the process of the shutdown, has a capacity of 263,776 barrels daily. The Los Angeles refinery, property of Phillips 66, can process 138,700 barrels of crude daily. The closure of these two would reduce fuel production capacity in the country by 400,000 barrels daily.

The refining industry globally has been experiencing the effects of a declining supercycle even though demand has continued to grow, and, as confirmed by the EIA, this growth will continue. Even so, the record margins of 2022 and 2023 are gone now. Before the new cycle begins, some belt-tightening is in order.

In the U.S., refiners were also subjected to additional pressure during the Biden administration to join the federal government’s climate change-oriented energy policy and switch to biofuels from petroleum fuels. In California, specifically, pressure has been strong, both on the federal and state level, with the government in Sacramento recently demanding from refiners in California to keep a certain level of fuel inventories to avoid price spikes that the refiners themselves attribute to the state government’s energy policies seeking to phase out vehicles using petroleum fuels.

The closure of the Phillips 66 refinery in Los Angeles is one consequence of that policy. There are even reports that California authorities are considering refinery nationalizations to secure the supply of fuels to drivers in the state. Two refineries in California have already converted to biofuel production plants because biofuel production fetches generous subsidies from the state government: Phillips 66 is closing the L.A. facility by the end of this year, and Chevron and Valero are also considering shutdowns.

As a result of these refinery closures, the supply of fuels will understandably tighten, with diesel and jet fuel especially vulnerable, it seems. The diesel tightness will be global and manifest this year, as an estimated 1 million barrels per day of refining capacity across Europe and the U.S. is set to close permanently. Another 800,000 barrels daily in new capacity is set to come online in China, India, and Indonesia, Reuters estimated at the end of 2024, which leaves a gap of about 200,000 bpd. Demand for fuels, meanwhile, has continued to surprise to the upside.

In the United States specifically, refining output is estimated to decline by 190,000 barrels daily this year, the Energy Information Administration said this week, with a further decline of 180,000 barrels daily in 2026. “To meet the forecast increase in U.S. consumption of petroleum products with less U.S. refinery capacity, we expect refinery utilization to remain relatively high and for net U.S. exports of petroleum products to decrease to meet domestic fuel demand,” the EIA said in its Short-Term Energy Outlook.

If demand for fuels continues growing, a shortage may well be on the way, as suggested by the chief executive of Phillips 66 last year. Mark Lashier said in September 2024 that refinery closures prompted by low margins could shave some 700,000 bpd from global refining capacity. He saw this as a positive for U.S. refiners, however. “The US has become very competitive in refining,” Lashier said. “We’re able to compete out in the world global markets.”

By Oilprice.com / Irina Slav – Mar 04, 2025.

U.S. Natural Gas Prices Surge On record Export Flows

U.S. natural gas futures jumped in Monday’s early trading session, rebounding from recent lows driven by robust export flows and strong demand forecasts. Henry hub gas was trading at $3.98 per MMBtu at 11.25 am ET, up from a two-week low of $3.74 per MMBtu a week ago. U.S. LNG exports hit a fresh record 15.6 bcfd in February, boosted by new units at Venture Global’s (NYSE:VG) Plaquemines plant. The Arlington, Virginia-based LNG exporter commenced LNG production at its Plaquemines LNG plant 30 months after the final investment decision (FID) was made, making the plant with a 20 mtpa nameplate capacity one of the two fastest greenfield projects to reach first production. Once fully operational, Plaquemines will be among the largest LNG facilities in the world, featuring 36 electrically-driven 0.626 million tonnes per annum (mtpa) liquefaction trains, configured in eighteen blocks. 

“Reaching first LNG at Plaquemines at this pace will enable the United States to remain the top exporter of LNG in the world. Between current and planned facilities, Venture Global is prepared to invest $50 billion in energy projects based in the United States which will create jobs, support local economies, strengthen the balance of trade and unleash much-needed US LNG supply to our allies,” remarked Venture Global CEO and Co-Founder, Mike Sabel. 

The U.S. is rapidly developing LNG plants to meet Europe’s surging demand for the commodity. Two weeks ago, Cheniere Energy, for the first time, started producing liquefied natural gas (LNG)  from the first train (Train 1) of its Corpus Christi Stage 3 Liquefaction Project. As of Nov. 30, the overall project completion for the project was close to 76%; however, the company expects substantial completion achieved at the end of the first quarter of 2025. The project consists of seven midscale trains, projected to produce over 10 million tonnes per annum (mtpa) of LNG.

Meanwhile, gas demand in the Lower 48 states is projected to be higher than previously anticipated despite milder weather expected through March 18. Also, stockpiles remain about 12% below the five-year average due to earlier extreme cold. U.S. gas output hit a fresh record of 104.7 bcfd in February.

By Alex Kimani for Oilprice.com / Mar 03, 2025

Shell Mulls Sale of European, US Chemicals Assets, WSJ Reports

Shell is considering a potential sale of its chemicals assets in Europe and the United States, the Wall Street Journal reported on Sunday, citing sources familiar with the matter.

The energy group has hired Morgan Stanley to conduct a strategic review of its chemicals operations, the report said.

Shell and Morgan Stanley declined to comment.

Potential buyers could include private equity firms and Middle Eastern entities seeking to expand their Western presence, according to the newspaper.

The review is in its early stages and Shell has not yet made any definitive decisions regarding a potential sale, the Journal reported, adding that one of the assets included in the review was Shell’s Deer Park facility in Texas.

The Deer Park operation is adjacent to a refinery that Shell previously sold its 100% stake to joint-venture partner, Mexican state oil firm Pemex.

Last year Shell sold its refining and chemicals hub in Singapore, one of the world’s largest.

The British company warned earlier this year that it expects trading in its chemicals and oil products division to be significantly lower quarter-on-quarter due to lower seasonal demand.

Shell chief executive Wael Sawan has been focused on cutting costs and pivoting the company back to its most profitable sectors — oil, gas, and biofuels — while shifting away from renewable power.

Last December, Reuters reported exclusively that the oil major was stepping back from new offshore wind investments and is splitting its power division after a review of the business that was once seen as a key driver of the company’s energy transition strategy.

By: Reuters / March 03, 2025.