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Why Shorting NatGas Makes Sense Now

Why Shorting NatGas Makes Sense Now

While fundamentals spell more upside…

Britain Looks to Algeria for Alternative Supply of LNG

Almost all of Britain’s natural gas imports come from Qatar, but Qatar are now only sending left-over short-term deliveries, preferring to concentrate on high paying Asian customers, Japan and South Korea pay almost double the UK. Fears have grown that the UK may face a supply shortage in the future and are therefore looking to find an alternative supplier.

Algeria may be the key.

Following the attack on the In Amenas gas plant Algiers is looking to boost its oil and gas sector by attracting foreign investment.

Last month the government created new laws that offered easier tax terms and other incentives to attract foreign energy firms.

Related article: Shell's $6 Billion Deal with Repsol Crowns LNG King

Youcef Yousfi, Algeria’s Energy Minister, will take a trip to London this March when he is expected to talk with Prime Minister David Cameron about the possibility of supplying LNG to the UK.

Russia’s Gazprom, the world’s largest gas producer, spoke to Algeria’s state owned Sonatrach earlier in the month about a desire to create a long-term relationship. Gazprom supplies the majority of natural gas to Europe, but it is looking to expand in order to supply LNG to the growing market in Asia.

Analysts have warned that the unconventional reserves in Algeria are still decades away from being developed, and the current conventional resources are unlikely to attract the levels of investment needed to develop other reserves in the south of the country which is highly unstable and dangerous.

By. Joao Peixe of Oilprice.com



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