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Cyclone causes LNG loading delays in Western Australia -sources

Published 11/02/2020, 07:08 pm
Updated 11/02/2020, 07:14 pm
© Reuters.  Cyclone causes LNG loading delays in Western Australia -sources
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* Two cargo loadings cancelled -source

* Port closures cause queue of 13 vessels -Kpler

* Woodside says shuts production briefly at some facilities

By Jessica Jaganathan

SINGAPORE, Feb 11 (Reuters) - A powerful cyclone that swept across parts of Western Australia caused disruptions to shipments of liquefied natural gas (LNG), with at least two cargo loadings being cancelled, industry sources and traders told Reuters on Tuesday.

Australia is the world's second-largest exporter of LNG after Qatar. Any disruptions to its shipments could help to halt a further slide in Asian LNG spot prices LNG-AS , which are at a record low below $3 per million British thermal units (mmBtu), after a fast-spreading coronavirus in China drastically cut gas demand there. Tropical Cyclone Damien crossed the coast near Dampier in Western Australia state, making landfall on Saturday afternoon and bringing gusty winds of up to 200 km per hour (125 miles per hour). damage has been reported but several homes in Western Australia lost power briefly and two of the region's biggest commodity ports - Dampier and Port Hedland - were shut for one to three days.

The North West Shelf and Pluto LNG plants, operated by Woodside Energy and which together export 21.8 million tonnes a year of LNG, are near the Port of Dampier, which re-opened on Tuesday.

At least two LNG cargo loadings from the North West Shelf project were cancelled, an industry source familiar with the matter said. It was not immediately clear if the cargoes will be re-scheduled.

A spokeswoman for Woodside WPL.AX confirmed that there has been disruption due to the cyclone.

"As expected, we were required to briefly shut-in production at certain facilities, but overall we have withstood the impacts of Tropical Cyclone Damien very well," she said in an emailed statement.

"We are currently producing from both of our Karratha onshore facilities and are working to resume normal safe, reliable and efficient operations as soon as possible."

The port closures have left a queue of 13 vessels waiting to load LNG in Western Australia, including at Woodside's plants and also Chevron's Gorgon and Wheatstone LNG plants, said Rebecca Chia, an LNG analyst with data intelligence firm Kpler.

Chevron (NYSE:CVX) CVX.N did not immediately reply to a Reuters request for comment.

The cargo disruptions follow Royal Dutch Shell RDSa.L temporarily suspending production at its Prelude floating LNG facility off the coast of Australia last week, also curbing exports. Work is currently under way to restore full operations at Prelude.

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