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Royal Dutch Shell Plc .com: Spot trading set to increase as fleet expands

From Lloyds List
Published: Jun 29, 2006

The growing fleet and size of liquefied natural gas (LNG) carriers should help to increase spot trading in the industry, predicts Bob Salmon, general manager for shipping at Shell Trading, writes Tony Gray.

Mr Salmon, also a committee member of industry group the Center for Liquefied Natural Gas, said that the existing fleet was expected to double over the next decade.

In addition, the cargo-carrying capacity of the latest generation of new vessels was increasing substantially to more than 200,000 cu m.

‘There were some spot deals done recently,’ Mr Salmon said at the 2006 API Tanker Conference in San Diego.

‘Some LNG cargoes destined for the US were re-routed and sold to another buyer at a higher price.’

He added: ‘The growing fleet and higher capacity will help to improve spot liquidity.’

Mr Salmon said LNG was supplementing rather than replacing gas production in the US.

After 2010, LNG is expected to replace Canadian gas as the main source of US gas imports, according to the US Energy Information Administration.

At present, the US has five LNG import facilities operating, with combined peak annual capacity of 1.6trn cu ft. The EIA predicts peak annual US LNG import capacity in 2030 at 5.9trn cu ft, with actual imports of 4.4trn cu ft.

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