Playing the long game

Shell has committed itself to supplying Harvey Gulf with LNG out of Port Fourchon. This may not seem remarkable until you realise that this commitment is at the expense of a more immediate payoff.

“It could simply liquefy all the frack gas at its disposal and send it off to the highest bidder. After all, in the US it can only command around $4 per cubic metre, as opposed to four times that in Japan,” says David Bull of Ocean Shipping Consultants. “Which means Shell too must be thinking that putting the energy into forging the market must be worth it for the long term.” What he also points out is that other market players are conspicuous by their absence, standing back to see what happens and how best to make the pennies count.

It probably won’t be a straightforward development path. Going first has inherent risks attached and there will be rough with the smooth on the way. Rotterdam for example is ploughing up some of its newly laid reclaimed land in order to make a berth for a mid-sized bunkering barge which will provide the necessary LNG bunkering distribution, not something that was envisioned when the whole Gate project got going.