Page 11: of Maritime Reporter Magazine (October 1977)

known as the El Paso I project, which should be on-stream from

Algeria before end-1977. Algeria has recently contracted with Ger- man and Dutch gas importers for

LNG exports to Wilhelmshaven and Rotterdam beginning in 1984, while the USEC-destined Pan- handle (Trunkline) project has been given FPC approval though under condition of incremental gas pricing to consumers, rather than the preferred averaged-in price system.

Elsewhere, other possible fu- ture projects have advanced, no- tably those in Nigeria and Ma- laysia, where construction of liquefaction plant is soon due to begin, also in Indonesia, where expansion of existing newbuild- ing gas export plant is being con- templated, and on the N.W. Shelf

Australia, where gas exports by 1985 look highly likely, despite the lack of any definite plans con- cerning the siting of liquefaction plant, the export volumes avail- able, or finance. In Canada, Arctic natural gas has also excited top- ical interest, and liquefaction plant engineering studies for Mel- ville Island reserves are in prog- ress, while tenders have reported- ly been placed with shipyards for suitable LNG carriers. Other re- ports concern the possibility of massive Swedish LNG imports and the continued Soviet desire to enter the LNG exporters club with trades to the U.S. and Japan, who would also provide both fi- nance and technology.

However, press reports unfa- vorable to LNG have also been in evidence, with U.S. political involvement being a major factor.

Lack of FPC approval has forced the cancellation of the Algeria-

USEC Eascogas project, though this may be recontracted at lower import volumes. Two Burmah- controlled ships for the Eascogas trade have been switched to the

Indonesia-Japan trade and replace the last two newbuilding vessels required here, which now become possible cancellations. Two other

Algeria-USEC projects, Tenneco and El Paso II, are still awaiting

FPC approval, with decisions be- ing expected before end-1977, while USWC LNG import proj- ects remain highly uncertain.

FPC recommendations for pipe- line imports of Alaskan gas seem to rule out new Alaskan supplies of LNG, while Californian import terminal approvals are still being sought for Indonesian LNG sup- plies. If successful, environmental pressures forcing LNG reception sites offshore in California would ensure that no USWC LNG im- ports could begin prior to 1985.

Further reports have also de- tracted from the otherwise more buoyant LNG market outlook.

These reports involve negotia- tions for the postponement of de- livery of newbuilding LNG car- riers, the unworkable economics of LNG exports from the Middle

East Gulf to USEC and West

Europe, and the reopened Algeria-

Italy pipeline gas export contract (which presumably undermines a planned LNG shipping project be- tween the same parties).

In summary, prospects for LNG shipping have improved slightly in the past half year, but the immediate outlook remains de- pressed due to the expected ex- cess shipping supply up to 1982.

However, the prospect of poten- tial LNG shipping demand growth beyond 1981 is a plus point, but this growth rests on plans that are liable to postponement in the future.

The scheduled world LNG ex- port projects and LNG fleet sta- tistics used here will be analyzed and discussed in detail in a forth- coming H.P. Drewry Survey, "LNG Marine Transport Costs and Revenues," which is sched- uled for publication in autumn 1977. For further information, write to H.P. Drewry (Shipping

Consultants) Limited, 34 Brook

Street, Mayfair, London W1Y 2LL, England.

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ENGINE ROOM CONTROL SYSTEMS

FORNEY ENGINEERING COMPANY

P. O. BOX 189, ADDISON, TEXAS 75001

TELEPHONE: (214)233-1871 TELEX: 73-0303 / WOULD LIKE TO KNOW MORE ABOUT

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October 1, 1977 15