Global portfolio supplier Total is expected to more than double its LNG trading volumes by 2020 to around 15 million mt, from around 7 million mt in 2014, President Gas at Total, Laurent Vivier, said this week.
The total volume for loading by 2020 includes the 3.5 million mt/year the France-based seller has secured from US Gulf projects on an FOB basis, Vivier said in an interview on the sidelines of the Gastech Singapore 2015 conference.
"The share of those volumes within our overall portfolio in 2020 will be roughly matching the share of the US in the overall LNG markets," he said.
"And I think it is a good base because it allows us to offer to customers both in terms of flexibility and in terms of pricing something which is consistent with the overall market."
Total has a 2 million mt/year offtake agreement with the Cheniere-operated Sabine Pass LNG project in Louisiana, and a separate 0.7 million mt/year agreement with South Korea's Kogas for loading from the same project.
Details on the source of the remaining 0.8 million mt/year were not immediately available, but Vivier said Total had secured volumes for 2020 loading from at least two LNG projects in the US Gulf.
Total has already committed 85%-90% of the 15 million mt/year to deliveries into either long-term contracts or regasification capacities controlled by the seller, including terminals in Europe and India.
"That leaves some things to be done," Vivier said. Total could aim to sell the additional quantities through long-term contracts, in the spot markets, or develop new markets downstream such as the transportation sector, he explained.
"Our job now is to consolidate and develop demand," he said. This goes through different stages, he added, including the expansion of the company's regasification capacity to unlock access to some markets.
"When you start having a big portfolio like us, you cannot just sell it to third parties and hope that they will develop the downstream," he added. "We need to do it ourselves, not entirely but for part of it."
There is potential regasification market growth in India, Southeast Asia and China, where Total is in discussions with state-owned CNOOC to increase delivery volumes within an existing 1 million mt of LNG/year contract that expires in 2024.
"We would like to increase our exposure to the Chinese market," he said. "That is why we are launching some discussions, so we will see where it leads to in terms of additional quantities," he added.
China will be one of the major importers of LNG in the future, Vivier said.
"Somebody who is presenting itself as the second largest LNG player in 2020 cannot afford not to be in a substantial manner in China ... So we will be."
Asked about the prospects of an Asian market-linked LNG contract price, he concluded: "It would be nice to have a price reference in Asia which would reflect the price of gas in Asia. The JKM could be a good proxy ... If it develops, it would be good."
