Trafigura logs rise in LNG volumes

Commodity trader Trafigura said its LNG volumes rose about 10 percent in the fiscal year ending September 30 as the firm continues to expand the business.

Volumes rose to 14 million tonnes compared to 12.7 million tonnes during the same period last year, Trafigura said in its annual report.

The Geneva-based firm has offtake deals with US LNG producers Cheniere and Freeport but it also works in the spot market.

Trafigura said extreme weather had “buffeted” the global LNG market in 2021.

The Far East experienced a severe winter shortage of LNG in January, Texas suffered
from its big freeze in February and Europe suffered gas shortages in the latter part of the year.

“LNG supply would have been tight in any case as plants were subject to maintenance that had been delayed by Covid-19 and a number of facilities experienced greater than usual
reliability issues,” it said.

In Texas, gas prices hit $400 per MMBtu in February, while in October, Europe and the Far
East out-competed each other to attract US LNG. This pushed the price up above $35/MMBtu as low inventories in Asia and Europe caused market concern, it said.

Asia growth

Trafigura said its integrated LNG and natural gas team had “performed
well, weathering the multitude of storms the gas market experienced during the year.”

“Our business grew in all regions, especially strongly in Asia,” it said.

The trader said it had complemented its existing natural gas trading operations in Europe, Mexico and the US by acquiring licenses to trade gas in other liberalizing domestic markets.

“In these extremely volatile times, simplicity of supply chains remains our guiding principle,” Trafigura said.

This ensures robustness to withstand extreme weather shocks and operational excellence to provide “safe and secure LNG supplies” to the company’s customers. It also allows the firm to minimize carbon emissions from its modern LNG fleet, it said.

Looking forward, Trafigura said its goal over the next 12 months is to work with the company’s customers to “create solutions that protect them as much as possible against such price fluctuations in the future.”

“Recent events have illustrated that natural gas is vitally needed to fuel baseload power supply alongside renewable power and, in some applications, as a transition fuel on the
pathway to net zero,” Trafigura said.

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