Thailand's new Nong Fab LNG terminal receives first LNG cargo from Qatar

The Nong Fab LNG regasification terminal, owned by Thailand's national oil company PTT, has received its first LNG cargo from Qatar signaling an earlier-than-expected startup for the new project, according to shipping data and recent company announcements.

The 122,079 dwt LNG carrier Al Oraiq, owned by Qatar's national shipping company Nakilat, loaded its cargo June 4 from Ras Laffan and arrived at Nong Fab June 17, according to Platts cFlow ship and commodity tracking software from S&P Global Commodity Insights.

Italy's Saipem, one of the technology companies awarded a contract for building Nong Fab by PTT LNG in 2018, said the terminal began offloading LNG from the carrier June 18, with full commissioning and startup expected within 2022.

The Al Oraiq delivered a commissioning cargo as part of PTT's long-term contract with Qatar, a Singapore-based trader said. A commissioning cargo is used to test an LNG terminal's different units, and a successful test paves the way for starting operations.

Saipem declined to provide further details on the terminal and PTT did not respond to queries.

The 7.5 million mt/year Nong Fab terminal project, located in the Mueang Rayong district of Thailand, is expected to start operations in October, according to Platts Analytics. It is the first new LNG import terminal in Asia to start operations in 2022, and it is doing so at a challenging time when spot LNG prices are at record highs for this time of the year.

Thailand's PTT has been active in the spot market over April to May this year, largely due to a production decline in the country's Erawan gas field, issuing a series of buy tenders for May-to-July deliveries.

The company May 16 closed a buy tender for June 9-10, June 18-19, June 25-26 and June 28-29 deliveries at a range of $22-$23.50/MMBtu DES Thailand.

However, sources said the price of the commissioning cargo could be lower, as it would have likely come from PTT's 2 MTPA long-term contract with Qatargas that is linked to oil prices.

The Nong Fab terminal includes two 250,000 cu m LNG storage tanks, and Saipem has previously said this the tank capacity is the largest ever executed in Thailand.