Japan's Jera shuts Chiba gas-fired power unit

  • Spanish Market: Electricity, Natural gas
  • 22/04/24

Japan's largest electricity producer by capacity Jera has shut the 360MW No.1-4 combined cycle gas turbine (CCGT) units at its Chiba power complex because of a technical problem.

Jera closed on 22 April the CCGT units at the 4.38GW Chiba complex in east Japan's Chiba prefecture, according to a notice by Japan Electric Power Exchange (Jepx). It is unclear when the units will be brought back on line.

The unexpected shutdown is likely to have limited impact on Japan's power market as the country has experienced mild weather lately that has capped power consumption. Jera consumed 16.7mn t of LNG in April-December 2023, lower by 4.8pc compared with the same period a year earlier, according to the firm's latest financial results.

Japan's total power demand averaged 83GW during 15-21 April, down by 3pc from the previous week, data show from nationwide transmission system operator the Organisation for Cross-regional Co-ordination of Transmission Operators.

Japan plans to add 1.1GW of thermal capacity during the week to 28 April, with the addition of 11.5GW outstripping the closure of 10.4GW, according to Argus' survey based on a Jepx notice. The difference incorporates the net increase this week in gas-fired capacity of 2GW and the net drop in coal-fired capacity of 887MW.


Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

23/05/24

US poised to back New Jersey offshore wind farms

US poised to back New Jersey offshore wind farms

Houston, 23 May (Argus) — US regulators could soon approve two offshore wind projects near New Jersey, but with stipulations that would slightly reduce the number of turbines installed in the Atlantic Ocean. The US Bureau of Ocean Energy Management (BOEM) favors a design for the Atlantic Shores South system that would result in up to 195 turbines, as many as 10 offshore substations and eight transmission cables to ferry electricity ashore to New Jersey, the agency said today in its final environmental impact statement for the project. Atlantic Shores South comprises two separate projects, Atlantic Shores 1 and Atlantic Shores 2, which are 50:50 partnerships between Shell and EDF Renewables. The pair's overall capacity is tentatively set at 2,837MW, with the first phase targeting 1,510MW and a size for the second to be determined. Atlantic Shores 1 has a contract to deliver up to 6.18mn offshore renewable energy certificates each year to New Jersey, with first power expected in 2027. The state selected the project through its second offshore wind solicitation, with the 20-year contract scheduled to begin in 2028. The developers had proposed installing up to 200 turbines, but BOEM decided to favor a modified plan, adopting alternatives put forward by the companies in the name of mitigating impacts on local habitats while limiting turbine height and their proximity to the shore to reduce the project's "visual impacts," a point of contention among New Jersey residents who fear damage to tourism in oceanside communities. The BOEM-endorsed design would have mostly "minor" to "moderate" effects on the surrounding environment, with exceptions including consequences for North Atlantic right whales, commercial and for-hire fisheries and local scenery, which could be "major." The areas potentially hit hardest by the projects would be open to "major" consequences regardless of the project design, according to BOEM's analysis. The preference is not BOEM's final ruling, but it does herald the path the agency is likely to take. Regulators will publish the review in a "coming" edition of the Federal Register, starting a mandatory 30-day waiting period before BOEM can publish its final decision on the project. By Patrick Zemanek Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

India’s AMNS signs 10-year LNG supply deal with Shell


23/05/24
23/05/24

India’s AMNS signs 10-year LNG supply deal with Shell

Mumbai, 23 May (Argus) — Indian steel manufacturer ArcelorMittal Nippon Steel (AMNS) has signed a 10-year deal to buy LNG from Shell, with deliveries to start from 2027, people with direct knowledge of the matter have said. Under the terms of the deal, the steelmaker's direct reduced iron (DRI) plant in the western Gujarat state of Hazira will receive 500,000 t/yr of LNG, Argus understands. The Hazira plant has crude steel production capacity of 8.8mn t/yr, according to ArcelorMittal's 2023 annual report. As much as 65pc of the capacity is based on DRI. AMNS also has a deal with TotalEnergies for 500,000 t/yr that is scheduled to expire in 2026 . This deal comes at a time when AMNS plans to expand its steel capacity to 20mn t/yr in the long run . This supply pact also underscores a trend in the global steel industry to use cleaner energy sources to produce the so-called 'green steel'. The firm imports up to 75pc of its 1.72mn t in natural gas requirements on an annualised basis, a source said. The deal was signed at a 11.5pc percentage of Brent crude prices, trading firms said, adding that this is so far the lowest-heard slope for an Indian term LNG supply contract. AMNS sought LNG supply for a period of 5-10 years starting in 2027 under a tender that closed in mid-March. The firm last sought long-term LNG in 2022 through a tender for 400,000 t/yr of LNG to be delivered across 2025-30. Indian importers will continue to seek term supply despite softening spot prices, mostly to hedge their risks in a market that can still be volatile, trading companies said. The Argus front-month price for LNG deliveries to India was assessed at $11.50/mn Btu today, up from $10.16/mn Btu a week earlier. The price reached as high as $48.30/mn Btu in August 2022. The firm has lowered its carbon emissions by 32pc in calendar year 2022 from 2015 levels, it said. By Rituparna Ghosh Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Shell to step up gas exploration in Oman


23/05/24
23/05/24

Shell to step up gas exploration in Oman

Dubai, 23 May (Argus) — Shell Oman is actively looking to explore more wells in the sultanate's onshore blocks after production reached a "little above" the plateau target of 500mn ft³/d (5.2bn m³/yr) in its core block 10 this month, according to the oil company's country chairman, Walid Hadi. Hadi told Argus that the company has embarked on an "aggressive exploration" campaign to unlock the potential in Oman's core onshore blocks 10 and 11 in which Shell has operating stakes. The blocks are part of the gas-rich Greater Barik area in the northern segment of state-controlled PDO's block 6 concession in the central region of Oman. "Oman is a niche gas sector," Hadi said. "It may not be the biggest LNG exporter in the world, but there is quite a sophisticated and high-quality gas system in place." Shell, which is also the majority private shareholder in state-owned Oman LNG, expects to boost gas production for domestic purposes and eventually for exports, according to Hadi. "We will require new gas if we are going into LNG," he said. "We know there is more potential in the blocks, but we still don't know at what scale it can produce as the two blocks are a combination of undiscovered and discovered resources." TotalEnergies said earlier this year that Oman LNG was eyeing a fourth train at its 11.4mn t/yr Qalhat LNG export terminal, having already added 1mn t/yr in liquefaction capacity through plant debottlenecking. Hadi said that Shell is planning on a "material increase" in gas production and would be able to conclude the growth potential of the blocks by mid or late 2025, when it completes the exploration programme. Gas from block 10 is sold to the government through the Integrated Gas Company, which is the entity that allocates the gas across different sectors based on certain policies and value criteria, according to Hadi. Shell has a 53.45pc stake in the block, with Marsa LNG and OQ holding 33.19pc and 13.36pc, respectively. The partners signed the concession agreement for block 10 in December 2021. The adjacent block 11 was awarded to OQ and TotalEnergies in 2021. When it comes to block 11, the company did make a material gas discovery, which is being appraised this year, but it is too early to talk about the production potential, Hadi said. "We also see quite a bit of potential in block 11 already." "Exploration is a very tricky business," he added. "You have to go after a lot of things and only few will end up working. We are at a very aggressive exploration campaign at the moment. We also expect by the end of 2025, we would be in a much better position to determine the next wave of growth and where it's going to come from." By Rithika Krishna Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

China’s natural gas consumption to peak in 2040: CNOOC


23/05/24
23/05/24

China’s natural gas consumption to peak in 2040: CNOOC

Singapore, 23 May (Argus) — China's state-controlled CNOOC expects domestic natural gas consumption to peak at 700bn m³ in 2040, said CNOOC's senior economist Xie Xuguang at a liquefied fuel shipping conference in Chongqing over 22-24 May. The conference was jointly organised by the China Shipowners' Association and Langfang International Pipeline Exhibition. CNOOC also estimated China's gas consumption to hit 410bn m³ in 2024. These most recent projections are aligned with earlier estimates from fellow state-controlled CNPC 's economic and technology research institute in Beijing, which forecast Chinese gas demand will rise by 24bn m³ in 2024 in its annual report published on 28 February. International Gas Union's president Li Yalan expects natural gas consumption in China to hit 500bn m³ in 2030 and eventually 650bn m³ in 2040. And all above growth scenarios could in fact be further enhanced should gas prices remain at "reasonable" levels, she added. She did not expand on the definition of "reasonable", but recent buying interest from mostly second-tier buyers in China hinted that the ideal target price considered acceptable for buyers in the country could be no higher than $9-9.50/mn Btu. Current spot prices are still considered way out of reach for Chinese importers. The front half-month of the ANEA — the Argus assessment for spot LNG deliveries to northeast Asia — was last assessed at $11.525/mn Btu on 23 May, $1/mn Btu higher from a week earlier. Factors such as higher-than-average temperatures in northeast Asia, southeast Asia, south Europe and the US, and some remaining concerns over production outages in the Atlantic and Pacific basins have resulted in European gas hub prices strengthening and Asian spot prices also jumping higher as a result. This is despite higher-than-average inventories in traditional major importing countries such as Japan and South Korea, and expectations of higher nuclear availability in Japan and South Korea to weigh on gas-fired generation in the summer . But traders have also pointed out that such higher prices may compel buyers in Asia to withdraw from the spot market, freezing out additional demand and eventually weighing on prices again. China has continued to step up its LNG imports even as domestic gas production extended gains in April . The country imported more LNG in April as compared to in 2023, and imports even hit a record high in March . Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Australia’s Origin to keep Eraring coal plant on line


23/05/24
23/05/24

Australia’s Origin to keep Eraring coal plant on line

Perth, 23 May (Argus) — Australian utility firm Origin Energy and the New South Wales (NSW) state's Labor government have agreed to keep the nation's largest single power facility open for at least two more years. The deal involves Origin shelving plans to close the 2,880MW Eraring coal-fired power plant near the NSW city of Newcastle next year, and operating the generator until 19 August 2027 and potentially until April 2029. A generator engagement project agreement has been signed, under which Origin will receive compensation covering the cost of running the 40-year old plant, while aiming for the plant to generate at least 6TWh for the two additional fiscal years it will run. Eraring produced 12.15TWh last year, Origin's 2023 annual report showed. The firm must decide by 31 March in 2025 and 2026 whether it will enter the underwriting arrangement for the following financial year. If Origin profits from its Eraring plant during these years it will pay NSW 20pc of the proceeds, capped at A$40mn/yr ($26.5mn/yr), but no compensation will be paid after 30 June 2027. Origin can claim no more than 80pc of Eraring's financial losses each year from NSW and the compensation is to be capped at A$225mn each year, if it does opt in. Origin spent A$147mn for generation maintenance and sustaining capital on Eraring in 2023, with A$69mn owing to costs associated with the facility's ash dam. Eraring provides around 20pc of NSW's delivered electricity and was scheduled to be replaced by the 2,200MW pumped hydro scheme known as Snowy 2.0 — which has experienced significant delays and will not be on line until 2029 — and the 750MW Kurri Kurri gas-fired power station also being developed by federal government-owned Snowy Hydro, which is to be commissioned later this year. Coal-fired power generation The viability of coal-fired generators has been declining for some time as Australia's renewable power generation grows to nearly 40pc of the total grid capacity. Widespread rooftop solar is driving electricity prices into negative territory during daylight hours and disrupting the profitability of large-scale generators. Origin has committed to a 460MW battery energy storage system (BESS) at the site of Eraring, which it says will provide two hours of firming capacity to the national electricity market. Australia's Clean Energy Council said the announcement must be backed by measures to integrate new renewable generation and storage into the NSW grid with "clear signals and support" to rapidly transition to renewables. Planning issues and rising costs have stymied the federal and state governments' plans to increase Australia's dependence on large-scale wind, solar, pumped hydro and BESS projects to replace coal generators. Canberra is aiming for an 82pc renewables share for Australia's electricity production by 2030. Coal-fired generation increased on the year for January-March because of a warmer-than-average summer and increased availability. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more