Bloomberg News

LNG Ship Rates Have First Gain Since January on African Cargoes

June 13, 2013

Rates to ship liquefied natural gas rose for the first time in almost five months as African producers expanded exports, according to Fearnley Securities AS.

Daily spot rates for turbine vessels climbed 3.5 percent to $89,000 this week, the first gain since Jan. 26, according to data from Fearnley LNG, a shipbroker in Oslo. Earnings slumped 28 percent since the start of the year. One-year charters were unchanged at $85,000 a day, according to Fearnley.

Cargoes are expanding as an outage in Nigeria ended and a new facility in Angola plans to start shipments, Rikard Vabo, an Oslo-based analyst at Fearnley, said in an e-mailed report today. Buyers in Kuwait, Israel and Asia are pushing prices for the frozen fuel above $14 per million British thermal units, according to Fearnley.

“Some positive news on the production front this week,” Vabo said in the report, citing Fearnley LNG. “We are finally seeing mid-term requirements emerge and owners seem to have adjusted rate expectations to levels charterers find attractive.”

Nigeria LNG is operating at full capacity as Royal Dutch Shell Plc said this week it lifted a force majeure declared last month. Force majeure is a legal clause freeing companies from contract terms because of circumstances beyond their control.

Angola LNG, originally scheduled to start almost 18 months ago, produced its first fuel before loading a cargo this month, three people with knowledge of the matter said.

To contact the reporter on this story: Isaac Arnsdorf in London at iarnsdorf@bloomberg.net

To contact the editor responsible for this story: Alaric Nightingale at anightingal1@bloomberg.net


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