Japan's Inpex launches FEED for Abadi LNG project in Indonesia
The Abadi project is expected to produce at its peak 9.5 million tonnes of LNG a year, 150 million standard cubic feet per day of pipe gas and 35,000 barrels of condensate per day, Indonesia's upstream oil and gas regulator data showed.
The FEED launch marks major progress for the project, chief executive Takayuki Ueda said, adding the company is making every effort to accelerate production at the project.
The Abadi LNG plant, in the Masela block, is expected to start production in the early 2030s. The project has faced years of delays.
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Reuters
2 hours ago
- Reuters
Asia's imports of US LNG to surge, but likely not enough for Trump
LAUNCESTON, Australia, Aug 21 (Reuters) - There are early signs that some Asian countries are stepping up their imports of U.S. liquefied natural gas (LNG) as part of trade deals with President Donald Trump. Asia's imports of the super-chilled fuel are on track to hit an eight-month high of 2.01 million metric tons in August, according to data compiled by commodity analysts Kpler. But of far more importance is the Kpler estimate that Asia's LNG imports from the United States will surge to 3.61 million tons in October, which would be the second-highest on record behind the 3.75 million from February 2021. There are caveats to the October prediction insofar as these are cargoes that have been arranged on a preliminary basis and may not actually load. But even if there is some slippage in actual volumes, it's likely that October will still see a surge of U.S. LNG arriving in Asia. The buyers for all this LNG have yet to be fully disclosed, but initial destination data suggest the bulk is heading towards North Asia, and this largely means Japan and South Korea. The world's second- and third-largest LNG buyers both committed to ramp up their energy imports from the United States as part of deals reached with Trump on import tariffs and investment. Japan didn't commit to an exact figure, but the White House website said on July 23 that Tokyo has committed to a "major expansion" of energy purchases from the United States. South Korea undertook to buy energy products worth $100 billion from the United States in a deal announced by Trump on July 30, although the time frame for that value to be reached wasn't made clear. However, the $100 billion figure looks high when compared with how much LNG, crude oil and coal South Korea has historically imported from the United States. South Korea imported 5.71 million tons of U.S. LNG in 2024, which at the current Asian spot price of $11.65 per million British thermal units works out to a total of $3.45 billion. Japan imported 6.50 million tons of LNG from the United States in 2024, according to Kpler, which would have a value of around $3.93 billion at current prices. Even if a tripling of LNG imports from the United States is assumed for Japan and South Korea, the combined value comes only to an annual total of around $22 billion. But the volume imported would rise to around 36 million tons, or about 42% of the 84.8 million tons the United States exported in 2024. U.S. LNG exports are likely to increase in coming years as new plants come online, but its capacity will be overwhelmed by demand if every country that has pledged to massively boost its imports as part of trade deals actually tries to follow through. Trump said the European Union agreed to buy $250 billion a year for three years of U.S. energy, a figure I described as delusional once the actual volumes needed to meet this figure were considered. What is not delusional is that most countries that have struck deals with Trump will at least make some effort to meet the terms of the deal, even if they all know the stated amounts are unrealistic. Even trying to buy more LNG, crude oil and coal from the United States has the potential to disrupt trade flows around the world and distort pricing. For example, if Japan did triple its LNG imports from the United States to an annual level of around 20 million tons, this would mean that it would likely buy about 12 million tons less from current suppliers such as Australia and Qatar. Japan would likely end up buying virtually no spot cargoes and would also likely be forced to sell term cargoes at discounts to other buyers. It's unlikely Japanese utilities would be willing to wear losses just in order to try to keep Trump happy, so the chances are there is an upper limit as to how much U.S. LNG they will be willing to buy. Furthermore, it's likely that an upper limit is well short of what Trump believes it should be. Enjoying this column? Check out Reuters Open Interest (ROI), your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, opens new tab and X, opens new tab. The views expressed here are those of the author, a columnist for Reuters.
Reuters
2 hours ago
- Reuters
Taiwan to massively hike 2026 defence budget as US presses spending increase
TAIPEI, Aug 21 (Reuters) - Taiwan plans to boost defence spending by a fifth next year, surpassing 3% of gross domestic product, as it invests billions more in new equipment to better face down China and convince the United States it takes seriously calls to bolster its military. The move comes as China, which views democratically governed Taiwan as its own territory, has ramped up military and political pressure over the past five years to assert its claims, which Taipei strongly rejects. But Taiwan also faces calls from Washington to spend more on its own defence, mirroring pressure from the United States on Europe. This month, President Lai Ching-te said he wanted to boost defence spending to more than 3% of GDP next year. Taiwan Premier Cho Jung-tai told reporters that 2026 defence spending would reach T$949.5 billion ($31.27 billion). At 3.32% of GDP, the figure crosses a threshold of 3% for the first time since 2009, government figures showed. "This is another concrete demonstration to the world and to our people of our determination and ability to safeguard national sovereignty and security, maintain stability and security in the Indo-Pacific region, and fulfil our shared responsibilities to the world," Cho said on Thursday. Taiwan was following the "NATO model" to include spending on the coast guard and veterans in total defence expenditure, he added. That represents a rise of 22.9% over this year, Hsieh Chi-hsien, head of the defence ministry's comptroller bureau, told reporters. The plans included several special defence budget proposals totalling T$117.6 billion, for new fighter jets and boosting naval defences among others, which had been widely expected from the defence ministry in the coming parliament session this year. Taiwan was including spending for the coast guard in its total defence budget for the first time, two senior officials briefed on the matter separately told Reuters, speaking on condition of anonymity. "They are standing on the frontline," said one, referring to the coast guard, which figures in regular stand-offs with China's coast guard and would, in time of war, be pressed into the navy's effort to defend Taiwan. "Facing new types of threat, including grey-zone tactics, it is necessary to include the coast guard in defence spending," the official said, referring to Chinese pressure tactics such as regular coast guard patrols near Taiwan's islands. Taiwan's government has made military modernisation a key policy platform and has repeatedly pledged to spend more on its defences given the rising threat from China, including developing made-in-Taiwan submarines. China's air force flies almost daily missions into the skies near Taiwan, and holds periodic war games, the last in April. China is also rapidly modernising its armed forces, with new aircraft carriers, stealth fighter jets and missiles. In March China unveiled a rise of 7.2% in this year's defence spending, to 1.78 trillion yuan ($248.17 billion), outpacing its 2025 economic growth target of about 5%. ($1=30.3650 Taiwan dollars) ($1=7.1724 Chinese yuan)
Reuters
2 hours ago
- Reuters
Oil extends gains amid signs of strong demand
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