Brazil alumina refinery procures spot LNG amid supply dispute

Alunorte, a major alumina refinery in Brazil, has procured a spot LNG cargo due to natural gas supply issues affecting its operations, according to multiple market sources on Aug. 13. The refinery's owner, Hydro, announced on Aug. 11 that it had cut alumina production in half after being informed of natural gas supply disruptions by its supplier.

Hydro stated it would take steps to maintain stability, including procuring spot LNG and gaining access to the Barcarena LNG receiving and regasification terminal. The cargo, sourced from a European major that previously supplied New Fortress for the terminal, is being delivered by the LNG carrier Maran Gas Vergina using third-party access, as reported by one source.

Hydro spokesperson confirmed the measures were initiated but declined further comment. The refinery is the sole customer of the Barcarena terminal, operated by New Fortress Energy. New Fortress had initially wanted to charge Alunorte a high fee for importing its own cargo. The Barcarena terminal has imported 430,000 metric tons of LNG this year, with August volumes delivered on the Maran Gas Vergina and HL Edward Austin carriers.

Alunorte has filed international arbitration against New Fortress over alleged gas supply delays, while New Fortress claims the claims lack merit. New Fortress plans to spin off its Brazil operations as part of recapitalization efforts.