France’s Total sees Q2 equity LNG sales price slide to $4.40/MMBtu
France’s Total said July 15 its average realized sales price for equity LNG in the second quarter of 2020 was $4.40/MMBtu, down by almost $2/MMBtu from the previous quarter.
It is the second time Total has published an average sales price for its LNG, with the major saying it introduced the price to allow for a “better understanding” of the company’s integrated gas business unit performance.
The Q2 average sales price of $4.40/MMBtu was down 30% on the quarter and 23% on the year.
Total said the indicator reflected the combined effect of sales volumes and prices of long-term contracts and spot sales.
“The share of spot sales volumes increased in the second quarter of 2020 compared to the first quarter 2020 due to deferments of some LNG uplifts by some long-term contract buyers,” Total said in a note.
It said the average long-term contract price was only reduced by 16% because of the deferred impact of the fall in oil prices.
The Q2 average of $4.40/MMBtu was well up on the average JKM spot LNG price in the period, as assessed by S&P Global Platts, of $2.14/MMBtu.
A large amount of long-term LNG supply globally is contracted on an oil-indexed basis with time lag, meaning term LNG has been able to secure a better price than spot LNG, which has been under significant pressure due to the oversupplied global market.
In 2019, Total’s equity LNG sales amounted to 16.3 million mt, up 47% from the previous year.
Overall, LNG sales were up 57% on the year at 34.3 million mt in 2019.
The increase was due to the ramp-up of the Yamal LNG facility in Russia and Australia’s Ichthys plant, as well as the startup of the first Cameron LNG train in the US.
Total also published July 15 its average global gas price of $2.61/MMBtu, which was down by 22% quarter on quarter and by 32% year on year.