MILAN, May 20 (Reuters) - ExxonMobil’s Papua New Guinea gas liquefaction plant is expected to export around 20 cargoes during the project’s start-up phase lasting until September, traders said.
The rapid export rate from the new plant, which was completed slightly ahead of schedule, has helped push global LNG prices lower as major Japanese buyers retreat from spot markets.
Exxon will sell the bulk of its output to buyers with which it has long-term supply deals, such as Japan’s Tokyo Electric Power and Osaka Gas, allowing them to fill needs without resorting to price-sensitive spot purchases.
“It’s going to be exporting around four to five cargoes per month over this period, but most of that will go to long-term buyers,” one trade source said.
Traders expect Exxon, however, to offer two to three cargoes on the spot market for July loading as early as this week.
Some traders advised against over-optimistic assessments of output given that start-up cargoes are always subject to delays as engineers fine-tune the liquefaction process. (Reporting by Oleg Vukmanovic)