May 18, 2018 / 10:44 AM / 2 days ago

UK's top Qatari LNG importer seeks to widen supply as cargoes slump

LONDON, May 18 (Reuters) - Britain’s busiest liquefied natural gas (LNG) import terminal, South Hook, is seeking to broaden its sources of supply as robust Asian demand diverts cargoes from Qatar - the world’s biggest exporter and the terminal’s majority shareholder.

Volumes to the terminal, in which Qatar Petroleum owns a controlling stake, have halved so far this year from a year ago to 1.2 million cubic metres (mcm) and amount to just 15 percent of 2016 volumes for the same period.

South Hook has been seeking to broaden the specification of its gas since January, a proposal that was approved on Thursday by the Joint Office of Gas Transporters (JOGT). The office administers the rules for transporting gas in the country.

The terminal received approval to raise oxygen limits within the gas it delivers to Britain’s network, “allowing greater diversity of gas composition of future cargoes at South Hook LNG Terminal”, according to its proposal document to the JOGT.

“The UKCS decline, Groningen production cuts and the closure of Rough long-range storage facility are all resulting in an increase in GB’s (Britain’s) gas import dependency,” it wrote, referring to falling regional supplies. “This modification supports this enhanced gas security of supply requirement.”

The terminal, with ExxonMobil and Total as minor shareholders, has been importing LNG from Qatar since it was fully commissioned in 2010. With capacity of 15.6 million tonnes a year, it is one of the biggest in Europe.

South Hook declined to comment beyond its public documents on the issue. (Reporting by Sabina Zawadzki; Editing by Mark Potter)

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