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Prices inch lower as Gorgon plant restarts production

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Reuters are reporting that Asian spot LNG prices edged lower this week as the early restart of Chevron's Gorgon production facility in Australia weighed on sentiment, projects offered supply and demand from Japan stayed weak.

Spot prices for July delivery LNG-AS were assessed at US$5.40 per million British thermal units, down 5 cents from the previous week.

The early restart of Gorgon's first production line provided an unexpected boost to Asian supplies after operator Chevron initially estimated the outage would last until mid-June.

Project stakeholder Exxon Mobil launched a tender to sell one cargo for delivery in the second half of June days before news of the facility's restart was made public.

Nigeria LNG launched the tender last week.

The various supply tenders from Angola, Nigeria and Australia, which offered June-loading cargoes, came amid muted summer demand from north Asian buyers.

Any downside to Asia spot prices could be capped by relatively firm European demand, including in Spain.

Results from the Nigerian and Angolan sell tender are expected to emerge in the coming days, but Asian LNG market participants said it was unlikely that the cargoes would be sold to Asia given the strength in Atlantic prices.

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