Gas Processing & LNG is Produced by Gulf Publishing Holdings LLC

Equinor, Gazprom lose European gas market share as LNG surges

Europe’s two biggest suppliers of pipeline gas, Norway’s Equinor and Russia’s Gazprom, have lost market share for the first time in at least four years amid a tripling in liquefied natural gas (LNG) imports into the region over the past 10 months.

LNG imports into Europe have jumped amid lower than expected spot demand from Asia, which has helped to send European gas prices to 10-year lows and filled European storages to multi-year highs.

Data compiled by Refinitiv showing changes in the market share of gas from Norway, Russia and LNG sources is the latest example of how LNG is transforming Europe’s gas market.

The share of LNG in gas supplied to western and central Europe increased to 14% between October 2018 and August 2019 from 5% in the same period of 2017-18.

The share of Norwegian gas dropped to 33% from 38%, a multi-year low, calculations by Refinitiv show.

Gazprom’s share was around the average of the past three years, edging down by 1% from the previous year to 32%. But it was the first year-on-year drop since 2014-2015, when it was hit by low gas demand in Europe.

LNG from the United States into northwest Europe accounted for 2% of total gas supply into the region, contributing to the strong increase in LNG in Europe.

Despite its market share loss, Gazprom’s total gas exports to Europe rose as the region imported 9% more gas from October to August, compared with the same period in 2017-2018.

“Most of the increase which we see in Russian supply this year came to Slovakia and the Czech Republic - countries which do not have direct access to LNG and which need to prepare their storages in case transit via Ukraine stops from January 2020,” said Marina Tsygankova, gas market analyst at Refinitiv.

The gas transit agreement between Russia and Ukraine is due to expire at the end of this year. The lack of progress in talks has spurred Europe to stockpile gas to prevent possible supply disruption in winter.

In countries with LNG terminals, Russian flows have given some ground to LNG volumes, an LNG market source said.

The drop in Norwegian flows, meanwhile, was seller-driven, with Equinor conducting extensive maintenance on its production and also reducing output, probably for commercial reasons.

In contrast, a drop in Russian gas flows to some western European countries, such as Germany, was buyer-driven.

“If I have a long-term contract and some flexibility left, I would run the contract low now and ramp it up again in September or later,” a gas trader in Europe said, pointing to current low spot prices.

A drop in Dutch production has also helped to create room for LNG arrivals.

The analysis was based on gas volumes for Germany, France, Austria, the Netherlands, Britain, Belgium, the Czech Republic and Slovakia from October to August over the past six years.

Reporting by Ekaterina Kravtsova; Editing by Nina Chestney and Mark Potter

Copyright © 2019. All market data is provided by Barchart Solutions. Futures: at least a 10 minute delay. Information is provided 'as is' and solely for informational purposes, not for trading purposes or advice. To see all exchange delays and terms of use, please see disclaimer.

                                  CMEGroup                                     Icelogo


Business Trends: Four challenges to Australia’s rising role in the global LNG market
-David Gross
The past 10 yr have been the decade of natural gas, but the next 10 yr will belong to LNG as countries race to build out their export capacity.
Editorial Comment
-Adrienne Blume
Australia and Middle Eastern countries, which have been net LNG exporters, are now foraying into LNG imports due to supply issues.
Industry Focus: Mixed performance for Africa’s gas markets in 2019 poses questions for next decade
-Shem Oirere
As 2020 begins, Africa’s gas market is left with a mixed bag of achievements that only partly confirms a prediction by the International Gas Union (IGU) in early 2019 that the continent’s natural gas segment is “facing a potential turning point.”
Regional Focus: North American NGL to boom alongside petrochemicals
-Eugene Khartukov
Strong natural gas production and rapidly rising demand from petrochemicals makers have resulted in record-high production of natural gas plant liquids in North America, particularly in the U.S. This growth has been led by ethane.

GasPro 2.0: A Webcast Symposium

View On-Demand

Following on the heels of the highly successful GasPro 2.0 Webcast Symposium in October 2018, the second GasPro Webcast Symposium 2.0 will take place on October 24, 2019.

The 2019 web event will gather experts in the fields of LNG, gas processing, and gas transport/distribution to share their operations expertise, engineering and design solutions, and technology advances and trends with our audience.

Attendees will learn about technology and operational solutions and deployments in a number of areas: plant design and expansion, construction, NGL production, optimization, sulfur removal, marine operations and separation technology.

October 24, 2019 08:30 AM CDT

View On-Demand


Please read our Term and Conditions, Cookies Policy, and Privacy Policy before using the site. All material subject to strictly enforced copyright laws.
© 2020 Gulf Publishing Holdings LLC.