Home' Trinidad and Tobago Guardian : June 6th 2013 Contents BG8 NEWS
BUSINESS GUARDIAN www.guardian.co.tt JUNE 2013 • WEEK ONE
Singapore Minister for Home Affairs and Trade
and Industry, S Iswaran, at the KPMG Global Energy
Conference, said that EMA will launch the second
round of consultations on a proposed LNG import
framework for Singapore next month.
Iswaran said Singapore is in the process of com-
missioning an LNG terminal on Jurong Island, which
is on track to commence operations this quarter.
"This is an important milestone for Singapore, as
it will allow us to access LNG from global gas mar-
"With the first two tanks, the terminal will have
an initial throughput capacity of 3.5 million tonnes
per annum (mtpa). This will increase to six mtpa by
the end of the year, when the third tank is completed.
We will also be building a fourth tank, which will
boost the terminal s capacity to about nine mtpa.
Besides providing the storage capacity to meet industry
needs, the expanded infrastructure could also catalyse
business opportunities in LNG trading, break-bulk
services and LNG bunkering," said Iswaran.
The bulk of Singapore s electricity is gas-based
and the country is building its first LNG import and
storage terminal in a bid to diversify its gas sources
and develop a trading hub for LNG. (LNG World
Royal Dutch Shell s position as a world
leader in liquified natural gas (LNG) has
been strengthened by its purchase of Repsol s
LNG assets inclusive of its stake in Point
Fortin-based Atlantic (formerly Atlantic
LNG), a senior vice president of the company
Dick Benschop, president of Shell in Hol-
land, and worldwide vice president for gas,
said in response to a question on the status
of the US$6.7 billion purchase: "The trans-
action still has to be completed, and there
are many areas where what is going to hap-
pen has to be specified.
"For us, the purchase is important for
two reasons. LNG production in T&T and
Peru, that will be incorporated into our port-
folio will strengthen Shell s position as the
international leader in LNG. And, second,
because of the incorporation of the trading
business. If you look at the portfolio of con-
tracts, Spain has received LNG for decades.
This business is, every day, more and more
The Economista said Benschop was "one
of the key players in the purchase of Repsol s
LNG assets" including its stake in Point
Fortin-based Atlantic. From 1998 to 2002,
Benschop was Holland s minister of foreign
affairs. He joined Royal Dutch Shell in 2003;
has been posted as far as Kuala Lumpur,
Malaysia, and has served as the company s
worldwide head of strategy.
"If you observe the graphs on the evo-
lution of LNG, you will see high multiples
of growth over the last 20 years and how
it has not stopped growing. For Shell, to
add on Repsol s portfolio will mean we will
be able to meet the growing demands of
Asia and Europe, as well as the new demand
from the Middle East, which is becoming
a great import market, with the summer
peaks in Dubai or in Kuwait, as well as the
imports and exports in South America that
make this business more and more global,"
Benschop told the Spaniards Economist
the US$6.7 billion transaction was "the fruit
of a very ambitious, integrated gas strate-
gy."He said: "We have development projects
in Australia, for example, and a lot of interest
in carrying out a gasification project there.
Our forecast now is for organic growth in
Australia, and in other places too."
The growth a company can achieve by
increasing output and enhancing sales is
considered organic. It excludes any profits
or growth acquired from takeovers, acqui-
sitions or mergers.
The deal with Repsol is "an extraordinary
transaction," he said, "but after this type of
acquisition, our strategy is to grow organ-
No change has been felt at Atlantic in
Point Fortin, and no change will be felt
before the transaction is completed. The
transaction, the vice president said, is
expected to be completed in the second half
of this year.
Asked what market share Shell would
obtain with the acquisition of Repsol s LNG
assets, Benschop said: "I think our market
share would get to about ten per cent of
the world s commercial LNG production
and capacity, which would make us the
world leader in LNG."
Price fixing allegations
Asked for a reaction to the European
Commission s raid on the offices of Shell
and other oil companies (BP and Statoil) for
alleged price fixing in collusion with Platts,
he said: "We maintain full co-operation
with the (European) Commission. We can t
comment any further, but we are offering
our full co-operation to the authorities."
Questioned about his thoughts on the
growth of shale gas in Europe, he said: "Fas-
cinating things are happening in the gas
sector in Europe. There will probably be US
gas being used in Spain in the coming years.
This will be a very interesting development
and it will be beneficial to Europe as it will
gain one more source of supply."
He said Europe will be most curious about
the potential of shale gas, as it is being
banned in France and in some parts of Spain.
"If there are new sources, the conversation
about conditions and regulations could start,
but that can t yet be said, not before it
begins," he said.
In Spain, there are many natural sources,
he said, and it will be "beneficial to the
country if the population accepts them. I
think we should do it."
He said innovation around gas and com-
bining it with electricity is growing. The
efficiency of gas is seen in LNG for transport
on trucks and boats, he said, adding that
"there will be new gas developments in the
world." He said gas will be used more and
will replace coals in electricity generation.
Questioned whether Shell is interested
in developing shale gas in Spain, he said:
"Our focus in Europe is in the Ukraine. We
are always looking but have no specific plans
for Spain. We are in China and there are
other countries such as South Africa or
Argentina that interest us. There are many
countries with wells like Spain and Tunisia
that have had no opportunities before."
Asked to confirm whether Argentine gov-
ernment invited Shell to participate in Vaca
Muerta, he said "there are some inconven-
iences" for him to talk on that topic. Vaca
Muerta is a large shale oil field and shale
gas field in Argentina. It was discovered in
2010 by the then Repsol-YPF.
LNG asset purchase in T&T
makes Shell world leader
Singapore LNG terminal
to start operations in Q3
About 30 per cent of shareholders of both Exxon
Mobil Corporation and Chevron on May 29 backed
calls for more disclosure surrounding their use of
hydraulic fracturing, the top two United States oil
The votes, which had about the same support last
year, reflect sustained concern among a large portion
of investors and the general population about the prac-
tice, which has unlocked a huge amount of oil and
gas resources across North America but led to envi-
ronmentalist worries about water contamination.
Chevron chief executive John Watson told the annual
meeting of shareholders that his company s level of
disclosure was adequate, as he responded to a request
from the fracking proposal s supporter for more quan-
titative measures of safety.
Fracking involves injecting chemical-laced water
and sand to break and prop open shale rock to unleash
oil and gas. The industry says it is safe when done
properly, and the debate has moved to Chevron s own
backyard, California, where it is just heating up.
Chevron said 31 per cent of its shareholders supported
the fracking proposal, compared with about 30 per
cent for Exxon. Last year, a proposal for a report on
fracking risks had support from 27 per cent of Chevron
shareholders, while a similar proposal got 30 per cent
support among Exxon investors.
"Shareholders expect Exxon to lead the industry,
but almost across the board Exxon is failing to provide
the site specific information that shareholders, reg-
ulators, and impacted communities need," said Danielle
Fugere, president of As You Sow, an investor advocacy
group that filed the Exxon resolution.
Another issue of great concern for environmentalists
is Arctic drilling, and rival Royal Dutch ShellPlc has
just gone through an accident-prone foray into offshore
drilling off Alaska s coast over the past year. Watson
said Chevron was still evaluating its opportunities in
the Arctic region.
"Most of the concerns are around costs," he said,
speaking to reporters after the meeting.
A few dozen shareholders gathered outside Chevron s
headquarters in San Ramon, California---just east of
San Francisco---with many of them decryling the influ-
ence of corporate money in US politics.
Exxon said in filings with the SEC that its current
policies already prohibit any kind of discrimination.
investors sustain calls
for fracking disclosure
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