“Fueling the Future” – this was the promising headline of a conference on LNG, which took place in Nice (France). Creon Capital has been a sponsor of this event, which Vilnius-based Wisdom Group has established as platform for international professionals on Liquid Natural Gas (LNG). Experts from well-known companies such Enagas, Petronas, Engie, Wison and Cryocan discussed perspectives for LNG-landing infrastructure in Europe and beyond, mostly with a positive outlook.
For Europe LNG is a trend, which maintains its popularity in political and business circles. However, prices for spot-traded LNG remain volatile and in the tendency expensive, the 27 existing LNG-landing facilities in Europe are operating far below their capacity.
Could LNG become an opportunity for Russian companies supplying European projects? This is the question asked by Dr. Fares Kilzie, Chairman of Creon Capital, and his answer appeared to be skeptical on the first view: “With domestic gas prices between 64 and 69 Euro per thousand cubic meter Russia belongs to the most competitive gas suppliers in the world”, he underlined. “But in Russia we are very good in delivering pipeline gas, but at the same time we are a poor player in the LNG market.” Russia, the country with the largest gas production in the world, accounts for merely 4 percent of the LNG supplies in the world.
Kilzie’s Creon Group, which is the Creon Energy Fund’s initiator and Russia’s leading consulting company for the Oil and Gas Downstream markets, counts currently almost a dozen small- and medium-scale projects in Russia. “All of them are clearly export-oriented, but in each of them something is missing”, he pointed out: the lack gas-supply, the lack of local demand, lacking legal permissions, non-sufficient financial equipment.
Despite all that Creon Capital believes in the development of competitive LNG supply chains on a global scale: Bunkering projects are gaining importance, fueling ships with the liquified gas is an increasingly profitable business, in countries like Spain or France large trucks are filled with LNG. “Given the growing demand for LNG, we expect increasing investments in the infrastructure.” And the latter projects would be more profitable, if they were fueled by cheap gas from Russia on the base of long-term contracts with producers such as Novatek. Dr. Kilzie concluded his statement with an invitation to propose scalable projects linked to gas supplies from Russia. The Creon Energy Fund would be ready to invest.
If you have any questions, please don’t hesitate us:
Florian Willershausen
Director Business Development,
Marketing and Communications
Creon Capital S.à.r.l.
T (GER) +49 151 162 44 591 (WhatsApp)
T (RUS) +7 968 783 84 12
T (LUX) +352 621 235 126
E willershausen@creoncapital.lu