Iran LPG Loading Up

Iran LPG Loading UpIran LPG Loading Up

Iran is loading 406,000 million tons of liquefied petroleum gas for export to China in August, almost one third above its average monthly lifting in the first seven months of this year and taking shipments back to around pre-sanction levels, shipping sources said this week.

The Middle Eastern producer is also exporting another 50,000 mt of LPG monthly, mainly to neighboring Iraq, in August, Platts reported.

These take total exports in the first eight months of 2015 to around 2.6 million mt, mainly to China, after Iran shipped out more than 3 million mt of LPG last year, also mostly to China and some to Iraq.

The rise in August loadings comes after Tehran and six world powers struck a deal on July 14 in Vienna, Austria, on Iran's nuclear program, which would lead to the removal of sanctions and increased flows of Iranian oil and gas onto world markets.

The US Energy Information Administration had said it assumed the deal would be implemented in Q2 2016, which would pave the way to ease sanctions on Iran's oil sector.

Switzerland last week agreed to lift certain sanctions imposed on Iran due to its nuclear plan in July 2012, including restrictions linked to the transportation of Iranian crude and oil products, the first country to take firm action since the deal was reached.

But even before last month's deal, Iran had resumed some LPG exports in May 2013 after an eight-month hiatus on concerns over the ban on shipping insurance, part of a range of oil and financial sanctions imposed by the European Union and the US in mid-2012.

Iran's LPG exports over the past two-and-a-half years had been gradually returning to pre-sanctions volumes of more than 4 million tons a year, largely due to its access to vessels, while Chinese firms have been building up a fleet of very large gas carriers, industry sources said.

Before the August loading volumes, which were the highest since May 2013, exports have been rising steadily to touch 308,000 mt in June 2015, before easing to around 270,000 mt in July, shipping sources said.

Eyes are now on volumes Iran could export on lifting of sanctions, with industry sources estimating up to 2 million mt more could be exported, especially from the Pars Special Economic Energy Zone— established for processing South Pars oil and gas resources—though this could take four to five years.

  Shipments From Five Sources

Iranian Gas Commercial Company has loaded at Asaluyeh a 44,000-mt cargo aboard the VLGC Ming Long, owned by Siam Lucky Marine.

The vessel is now at the Nipah ship-to-ship zone off Singapore, according to Platts cFlow ship-tracking software, and sources said it is bound for southern China. Siam Lucky Marine's Thai parent, Siamgas, has an LPG storage terminal in Shantou.

IGCC will be loading a similar cargo at Asaluyeh aboard the Shandong Shipping-owned VLGC Gas Jasmine, which is currently near Ras Laffan, according to Platts cFlow.

Bandar Imam Petrochemical Company, a unit of National Petrochemical Company, is transporting three cargoes in August from Bandar Imam Khomeini Port. The VLGC Gas Courage, owned by London-based Latsco, will arrive in Guangdong at the weekend with a 44,000-mt cargo.

The 54,155-dwt Gas Miracle, owned by Galata Denizcilik, has also loaded a 44,000-mt cargo from the port, as well as a 10,000-mt lot from Kharg Petrochemical Co. Ltd. and is bound for Guangdong around August 28, according to shipping sources and Platts cFlow.

Bandar Imam Petrochemical Complex is also loading a 22,000-mt lot at the port aboard the Benelux Overseas-owned VLGC Gas Beauty, which is due to arrive near Dubai at the weekend. Gas Beauty will co-load a 22,000-mt cargo from Pars Petrochemical Co. at Asaluyeh, sources said.

Pars has also loaded a 44,000-mt consignment aboard the China Peace-owned VLGC Gas Commerce, which is due to arrive in Guangdong on August 28, Platts cFlow shows.

National Iranian Oil Company has or will load three 44,000-mt cargoes at Asaluyeh. The Kunlun Shipping-owned VLGC Sea Danuta is now near Ningbo, while Sea Dragon is currently near Singapore waters.

Sinogas Management-owned Gas Crystal is expected to reach Fujairah around August 26 before loading a cargo at Asaluyeh, according to shipping sources and Platts cFlow.