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LNG import bad news won't quit
Chevron asks to re-direct LNG cargoes — Upstream Online
Chevron has requested authorisation to re-export foreign-sourced liquefied natural gas from the Sabine Pass terminal in Louisiana, according to a filing earlier this month with the US Department of Energy.
Chevron is the latest in a growing list of companies looking to re-export LNG from the United States where a surge in domestic gas production has dented import needs and pressured prices.
LNG re-export allows traditionally import-only US terminals to take gas, store it on site and re-export later to higher-paying markets in Europe, South America or Asia.
It has become a key strategy for some U.S. terminals - built before the boom in domestic shale gas production - that would otherwise sit idle for much of the year because low US gas prices and weak demand deter shippers from sending much gas there.
The Freeport terminal in Texas also has approval to re-export LNG and Sempra's Cameron terminal in Louisiana has recently applied for a license. [Red, yellow & bold emphasis added.]
Golden Pass LNG terminal to receive commissioning cargo (Sep 29) — Oil & Gas Journal
At full operation, Golden Pass will be able to import 15.6 million tonnes/year, according to the project’s web site, and be able to deliver the equivalent of 2 bcfd of natural gas. The terminal is a joint venture of Qatar Petroleum International 70%, ExxonMobil 17.6%, and ConocoPhillips 12.4%.
The terminal was on schedule to open last year when it was severely damaged by Hurricane Ike in September 2008.
This will likely be the last LNG terminal built in the Lower 48 for some time, given the low prices offered here compared with LNG markets in Europe and Asia and the growth of US gas reserves thanks to shale gas development. [Red, yellow & bold emphasis added.]
Shale gas production reduced gas imports in 2009 — Energy Tribune, Houston, TX
Net U.S. imports of natural gas reached the lowest level seen since 1994, or 12 percent of total consumption, as the surge in shale gas activity continues to push gas production in the U.S. Lower 48 states, the U.S. Energy Information Administration (EIA) reported this week. [Red & bold emphasis added.]
Barclays Capital predicts flat U.S. LNG imports in 2011 — LNG Law Blog
In a report released this week, Barclays Capital analysts wrote that they do not expect overall U.S. imports of LNG to increase in 2011 as compared to 2010 imports. The report states that the expected price spreads between the United States and other LNG markets around the world are likely to discourage any increase in LNG imports to the U.S. market.
[Red emphasis added.]
It's been a good year for Canaport LNG: executive — New Brunswick Business Journal, Saint John, NB
Phillip Ribbeck, Repsol Energy North America president, says his company is currently responding to requests for proposals and it's too early to tell whether it will be able to put up to 800 million cubic feet of natural gas per day this winter on the market - twice the amount last winter.
"We would like to do so, but we can't put more gas in the marketplace than the market's going to demand," Ribbeck said in a phone interview Wednesday, about a year after his firm's liquefied natural gas facility began operations in Saint John.
Ribbeck said last winter was the first time ISO New England didn't have to call upon additional oil-fired power generation in the region, since Canaport LNG could supply gas-fired plants with fuel.
"It's been our view that gas from Marcellus doesn't have a way up from an incremental perspective," he said.
"That's why producers are working with pipelines in order to move the gas in different directions and secure other markets."
Warning system keeps whales all right — Cape Cod Times, Hyannis, MA
The new warning system is the first in the world to show, in real time, the general presence of endangered whales as well as ships in one of the mammals' most populous gathering spots.
LNG ships are among the fastest and largest vessels afloat, he explained. In the case of whales, it is speed that kills. Slowing vessels by just a few knots dramatically increases the whales' chances of surviving or avoiding a collision.
But first you have to know where they are.
As part of an agreement to lessen their potential impact on whales, the gas companies funded an automatic alert system that includes the placement of 10 acoustic buoys in the shipping lanes that run through the sanctuary. Computers in the buoys are programmed to recognize a distinctive sequence of sounds that the right whales use to signal the desire to gather. These "up" calls do not travel farther than five miles, which means the whales are relatively close to the buoys.
What Wiley and others at the sanctuary are hoping to do is leverage this system into one that will alert all ships in the area. Thanks to a federal law that requires all vessels over 300 tons, or that carry more than 150 passengers, to use a device that broadcasts a signal containing its location, identification and other information at two-second intervals, scientists can pinpoint every large vessel operating close to shore and close to whales.
Natural gas outlook: Spot prices 5-10% lower in lower 48 states — AgNetwork, Lenexa, KS
[S]ome of the largest price decreases during the report week occurred in Northeast markets, where cooler weather prevailed. Market prices posted decreases of as much as 7 percent on the week. For delivery in Zone 6 into New York off Transcontinental Gas Pipeline (Transco), the price on Wednesday, September 29, reached $4.09 per MMBtu, a decrease of 29 cents, or almost 7 percent, from the start of the report week. Trading at the Intercontinental Exchange, Inc. (ICE), continues to suggest that a much lower price spread between the Northeast and the Henry Hub is developing. The price for deliveries to Transco Zone 6 in January 2011, for example, is currently priced about $2.02 per MMBtu over the Henry Hub price in ICE trading, while last year at this time the premium was about $3.42. This lower differential is likely because of more supply options for the region, including growing supplies in the Marcellus Shale, access to Rockies supplies, and regasified liquefied natural gas (LNG) from the Canaport LNG terminal in Canada.
- The U.S. Coast Guard issued a report to the Federal Energy Regulatory Commission concerning the waterways associated with the Calais LNG terminal near Calais, Maine. Calais LNG proposes to build a 1 Bcf/d receiving terminal and associated pipeline on 2,800 feet of shoreline along the banks of the St. Croix River and Passamoquoddy Bay. The Coast Guard was tasked with assessing safety and security issues associated with LNG tankers traveling through these waterways. The Coast Guard reported that provided certain safety and security actions are taken as part of the permit, the waterways are suitable for LNG tankers. Official notification from Calais LNG of their proposal to build an LNG terminal near Calais was given to the Coast Guard in May 2008. The Canadian Federal Government has said that it will not allow LNG tankers to pass through Canadian territorial waters in the Head Harbour Passage; until such permission is granted, tankers will be unable to reach the facility.
More than 100 Savannah residents show up to oppose LNG plan (Sep 29) — Savannah Morning News, Savannah, GA
With measured outrage infusing well-researched remarks, dozens of Savannahians told federal regulators Wednesday night they don’t want liquefied natural gas trucked through the city.
[Kent Harrington, a Savannah resident who has experience in crisis management,] detailed a 2002 LNG trucking accident in Tivissa, Spain, in which a tanker carrying 12,000 gallons of LNG overturned and caught fire on a mountainous road. The fire produced what’s technically called a boiling liquid expanding vapor explosion, killing the driver and severely burning two people who were more than two football fields away. The truck’s diesel engine was blown 842 feet away; fragments of the tank flew 150 to 400 feet.
Savannah officials: LNG importer broke deal — GPB (Georgia Public Broadcasting) News
SAVANNAH, Ga. —
The City of Savannah is trying to stop hazardous liquefied natural gas from being transported on city streets.
El Paso wants regulators to makes its decision on an expedited basis.
"There is no reason whatsoever for an expidited decision other than they are trying to get this passed through as quickly as possible," [Savannah Alderman Jeff Felser] says.
"I have the copies of the agreement and I'll quote," Felser says. Reading from the document, he continues, "'We have been assured by representatives of the El Paso company that no LNG shipments will be made on the streets of Savannah.'"
[Red emphasis added.]
LNG truck route ignites citizens' ire — Savannah Morning News, Savannah, GA
"The core problem is that Elba Island is on the eastside of the city and there is no route through this city that does not present a risk to some neighborhood," said Bill Durrence.
Savannah resident Virginia Mobley drew on her knowledge of disaster response and educated the crowd about the recommended response to an LNG spill and fire. Reading from the federally-produced Emergency Response Guidebook on hazardous materials, she said: "If a tanker truck is involved in a fire, isolate one mile in all directions. Consider evacuating one mile in all directions."
Savannah officials say they were surprised by the company's trucking request, in part because when the Elba facility re-opened in 2001, city leaders thought they had exacted a promise not to truck LNG through the city.
Southeast LNG president Bruce Hughes says now that wasn't a forever pledge.
[Red & brown emphasis added.]
Town hall meeting set on LNG proposal — WTOC-TV, Savannah, GA
The city has hired a consultant to advise the Savannah City Council on the Federal Energy Regulatory Commission process and provide technical detail on the proposal. The consultant will make a presentation at the [Oct. 7] meeting. The public is invited to offer input. Savannah City Council will also be attending.
Citizens Against LNG put up a fight — KCBY-TV, North Bend, OR
The local group, Citizens Against LNG, is putting up a fight against the Pacific Connector pipeline, by filing an appeal to their conditional land use permit.
McCaffree put together more than 500 pages of testimony showing the county's decision to approve the permit, goes against many of it's own rules meant to protect private property rights.
August LNG import prices up 31% (Japan) — LNG World News
Prices for delivered LNG rose to 50,233 yen ($602) a metric ton, according to data from the Ministry of Finance. That’s equivalent to about $11.43 per million British thermal units, more than twice the price of U.S. benchmark gas futures at Henry Hub, data compiled by Bloomberg showed.
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Industry players: LNG "critical" to U.S. Northeast — LNG Law Blog
Platts LNG Daily reports that two natural gas industry officials, speaking earlier this week at a conference in Boston, said that they expect LNG imports to remain an important component of the energy supply for the U.S. Northeast. Industry consultant David Palmerton noted that despite increased domestic natural gas supplies from shale gas plays, LNG supplies are critical to the region during cold weather.
USA: Resolution opposing offshore LNG projects advances in New Jersey Senate — LNG World News
Bipartisan legislation sponsored by Senators Sean Kean and Bob Gordon that would ban the construction of liquefied natural gas (LNG) transfer stations off the coast of New Jersey cleared the Senate Environment and Energy Committee last week.
“When you add in New Jersey’s ecological diversity off the coast, and the importance of our shore region to the State’s tourism economy, it becomes even clearer. We cannot put New Jersey lives, property, tourism and environmental quality at risk for the low-yield benefit of LNG facilities in our coastal waters.”
LNG trucks on top of DeRenne businesses' minds — Savannah Morning News, Savannah, GA
Folks along the DeRenne corridor are most apprehensive about safety issues and the time of day that the trucks will be coming through.
Questions remain [Editorial] — Savannah Morning News, Savannah, GA
[FERC] is considering a request from Southern LNG, which operates a natural gas terminal on Elba Island. The company hopes to start an LNG trucking operation, beginning with 10 vehicles, but building up to 58 trucks a day. It plans to run the vehicles south down the Truman Parkway, then west via DeRenne Avenue - one of Savannah's most congested thoroughfares.
Watson: LNG truck route too risky [Op-ed column] — Savannah Morning News, Savannah, GA
The claims by industry that LNG cannot burn or explode, and that when it evaporates it rises, are true. Yet they are also misleading.
As to the repeated claim that LNG is "clean," while it may be true relative to coal, it is false overall. The LNG production and transport process is energy intensive, and the net impact on the environment per unit of energy produced by LNG is far greater than other energy sources, especially when compared to nuclear or renewables.
Mr. Hughes statement that LNG will "reduce our dependence on oil" is absolutely ridiculous, as we are simply exchanging dependence on foreign oil for dependence on foreign LNG, obtained from the same limited, unfriendly and politically unstable sources.
Sempra LNG Marketing, LLC; Application for Blanket Authorization to Export Liquefied Natural Gas — Business Video
SUMMARY: The Office of Fossil Energy (FE) of the Department of Energy (DOE) gives notice of receipt of an application, filed on September 2, 2010, by Sempra LNG Marketing, LLC (Sempra), requesting blanket authorization to export up to a total of 250 billion cubic feet (Bcf) of foreign sourced liquefied natural gas (LNG) for a two-year period commencing on February 1, 2011. The LNG would be exported from the Cameron LNG Terminal (Cameron Terminal) owned by Sempra's affiliate, Cameron LNG, LLC, in Cameron Parish, Louisiana to any country with the capacity to import LNG via ocean-going carrier and with which trade is not prohibited by U.S. law or policy, over a two-year period commencing on the date of the authorization. [Red bold emphasis added.]
No commitment from Jamaica Public Service (JPS) for LNG — The Gleaner, Kingston, Jamaica, West Indies
"While fuel diversification is an important element of a sound energy policy for Jamaica, the development of the LNG project has not reached the stage where there is sufficient specificity for JPS to provide substantive comments at this time," said Winsome Callum, the company's head of corporate communications.
JPS is critical to the government's LNG programme, which is aimed at lessening the country's 90 per cent demand on oil as its energy source.
Conoco's Mulva downbeat on Denali on back of gas price doldrums (Oct 1) — PennEnergy
BMI View: Low gas prices resulting from booming unconventional US production raise doubts over the economics of the planned Denali gas pipeline. Its Exxon-led rival benefits from the potential to convert to an LNG export project. [Red & bold emphasis added.]
ConocoPhillips rep: No wavering on gas line — Juneau Empire, Juneau, AK
TransCanada and Denali have each put forth plans to deliver about 4.5 billion cubic feet of gas per day to North American markets by larger lines to Canada; each aims to be in service by about 2020. Denali has estimated its project will cost $35 billion, while TransCanada has put its figure at $32 billion to $41 billion. TransCanada also has offered a shorter, cheaper option: a $20 billion to $26 billion line that would lead to a liquefied natural gas facility that could export fuel by ship.
Denali hopes to know by March whether it can reach agreements with potential shippers - and whether there's enough interest to move ahead, MacDowell said.
MacDowell has said Denali would consider a liquefied natural gas option if that's what customers wanted.
ConocoPhillips hasn't scrapped Alaska gas pipeline: spokesman — Platts
Mulva told the Financial Times in a story that ran Monday that
ConocoPhillips was reassessing the economics of the Arctic pipeline, given a
supply glut from shale gas in the Lower-48 states.
"Energy is an essential part of America's economic stability and that is
where the gas line comes into play, bringing more than $10 billion worth of
domestic natural gas a year to the Lower-48 states at projected future
prices," [said President Obama].
When ConocoPhillips' open season ends on Monday, McLemore said the firm
would consider bids from potential shippers, plus the long-term outlook for
gas prices, supply forecasts and Alaska tax policy before deciding whether to
continue.
[Red, yellow & bold emphasis added.]
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Coast Guard finds waterways suitable for Calais LNG ships (Sep 24) — The Quoddy Tides, Eastport, ME
In response to the Coast Guard's recommendation, U.S. Senator Olympia Snowe stated, "Increasing maritime transport and natural gas supplies are critical to Washington County's economic future, and I appreciate the Coast Guard's deliberative analysis of the safety and security issues associated with LNG tankers transiting the Passamaquoddy Bay and the St. Croix River. The development of an LNG facility is a crucial issue for the communities of Washington County, and I will continue to work to ensure that the federal agencies continue to engage in a deliberative permitting process with the individuals most affected by this decision." [Bold red emphasis added.]
Calais LNG granted another delay to find financial backer (Sep 24) — The Quoddy Tides, Eastport, ME
"Calais LNG chose to fast track this application. It then chose to seek to postpone this proceeding when it failed to provide adequate responses to issues with its applications identified by the DEP and other state agencies and again when its financial backing dried up. It unilaterally chose a new deadline of September 11, 2010, to find new financing and has failed to meet that deadline."
Failure to communicate — Connect Savannah, Savannah, GA
Documents show Southern LNG's failure to contact city officials; consider impacts of DeRenne route.
“Fears outweigh actual evidence of disasters, however, that doesn’t make it safe,” said a Congressional report from September 2003, outlining the risks of LNG facilities.
The company is … going back on an agreement reached with the city nearly a decade ago that LNG would not be shipped through city streets.
During negotiations with the City of Savannah back at the turn of the millennium, the company gave its assurances that no LNG would be shipped through the streets of Savannah, and would be shipped exclusively via pipeline to customers north and west of here.
As contentious as the truck route is, it’s actually the one component of the proposed project that isn’t regulated by FERC. Southern LNG’s application deals strictly with the changes to the Elba facility itself.
Golden Pass LNG terminal announces 1st cargo for commissioning share — The Sacramento Bee, Sacramento, CA
PORT ARTHUR, Texas, Sept. 28 -- /PRNewswire-USNewswire/ - The Golden Pass LNG terminal announced today that the first cargo to be used for commissioning the facilities is anticipated to arrive during October 2010. This terminal is a joint venture owned 70% by Qatar Petroleum International (QPI), the international arm of Qatar Petroleum (QP), and the remaining by ExxonMobil and ConocoPhillips.
The cargo will be shipped from the Port of Ras Laffan in Qatar aboard a Q-Flex LNG tanker, currently one of the largest LNG carriers in the world.
The Golden Pass LNG terminal will have the capacity to deliver the equivalent of 2 billion cubic feet per day of natural gas when it reaches full operation. This represents enough natural gas to meet the average daily needs of about 10 million U.S. households.
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Bad news snowballs for LNG import proposals
ConocoPhillips shuts-in natural gas production to wait for better prices — PennEnergy, Tulsa, OK
There has been a marked increase in natural gas production in the continental US with improvements to drilling and recovering techniques that have tapped the vast shale plays across the nation. The Marcellus Shale play in northeastern US is estimated to be the second largest natural gas field in the world.
Because of the increased natural gas production – and the great possibility for more production – the US may become a natural gas exporter, via LNG. Three LNG receiving terminals have already petitioned the US government to be able to switch to export. [Bold red emphasis added.]
Bill to ban LNG stations off NJ coast clears committee — NJToday.net, NJ
“It is vital that we take steps today to protect New Jersey’s largest industry, tourism, from the type of environmental disaster that took place this summer in the Gulf of Mexico,” Kean (R-Monmouth) began. “This bill merely continues our long-standing opposition to oil and natural gas exploration off the coast of this state. Furthermore, there is an abundance of natural gas available in the United State and we should develop those resources before we ship any more money overseas.” [Bold red emphasis added.]
Shale gas technology — Oil & Gas Journal
Only a few years ago various forecasts said the US would need to import considerable amounts of gas as LNG, but with the development of shale gas, the US now is becoming self-sufficient in gas and may even become a gas exporter. [Bold red emphasis added.]
Cheniere Energy Partners and LNG exports (Sep 26) — Investing Daily, Falls Church, VA
The biggest problem isn’t how to import more gas but what to do with the growing oversupply. In 2009 record output from shale-gas plays enable the US to unseat Russia as the world’s top producer. [Bold red emphasis added.]
Cheniere Energy describes plans for bidirectional LNG facility at Sabine Pass (Sep 24) — SNL
"A lot of people ask, if this is such a good idea, why hasn't it already been done? There are two major reasons: The first is the sudden technology change in unconventional gas production," he said. "The other is the fact that the market for LNG globally has really grown." [Red & bold emphasis added.]
Sea NG Corp.’s ‘floating pipeline’ set to make maiden voyage in 2011 (Sep 26) — The Record, Kitchener, ON
Natural gas fetches considerably higher prices in Europe and Asia than it does in North America, which is flush with the commodity thanks to drilling in emerging shale gas formations, said Ralph Glass, vice-president of operations at AJM Petroleum Consultants in Calgary.
[Bold red emphasis added.]
Christopher Jylkka: Bearish winter for natural gas (Sep 26) — iStockAnalyst, Salem, OR
I see production increasing almost every day. There are a lot of dynamics — words being bandied around by pundits like "the shale revolution" and the "technology shock." There are definitely people on the speaking circuit talking about this, and it's really all true. We're seeing production increase almost every day.
On top of this new "Shale Revolution," we've had major increases in gas infrastructure.
This will mitigate [price] spikes. We're seeing lower prices—we haven't seen prices at this level for a while—and a lot less volatility, reflected in the implied volatility in the options market. And even in the daily and monthly price movements themselves.
One thing that people fail to consider is that a few years back, people thought we'd run out of reserves for gas, and there was a big build-out for LNG. The aftereffect of that was that they had to build liquefaction capacity, where they take the gas, liquefy it, ship it out and then re-gassify it. So this infrastructure was built and never used. There's a tremendous amount of idle infrastructure.
[Bold red emphasis added.]
USCG requires Calais LNG to have Canadian cooperation [News release] — MarineLink.com, New York, NY
"The most probable security regime should consist of a mix of U.S. and Canadian federal, state/provincial, and local law enforcement, which may require cost-sharing arrangements, as outlined in the Energy Policy Act of 2005. As mentioned previously, a major portion of the vessels’ route is initially through Canadian waters. Calais LNG must be able to adequately demonstrate that an effective security regime has been established during the Canadian portion of the vessels’ planned route prior to a loaded LNG vessel being allowed to transit to the facility."
Calais LNG believes Coast Guard recommendation will boost project (Sep 24) — SNL
The Coast Guard analysis of the Canadian and U.S. waters near the site said LNG tankers would have to follow parameters approved by the Coast Guard and "coordinated with the government of Canada," the group said.
"The government of Canada has repeatedly and firmly stated at the highest level that LNG transits are banned from Passamaquoddy Bay, indicating Canadian safety and security cooperation will not occur," Robert Godfrey, a researcher with Save Passamaquoddy Bay, said in a statement.
Indeed, in comments filed with FERC early in the year, Canadian Ambassador Gary Doer objected to the LNG tanker traffic that would come with the Calais LNG project or the nearby proposed Downeast LNG LLC project.
Coal remains a better option (Sep 26) — The Gleaner, Kingston, Jamaica, West Indies
While my position is supporting the competitive access to our energy grid, I do not support the arguments advanced by some that liquefied natural gas (LNG) is our energy "saviour". They fail to address any of the significant questions posed, e.g.: What will the final price of LNG be? Where will we get our sources from? Who will guarantee the supply? How can we prevent cartelisation when it now becomes our sole fuel source since this does not represent a diversified fuel strategy? If LNG is so cost effective, why do we need to provide guarantees of a market prior to making an investment? [Red emphasis added.]
Exmar's gift to the Caribbean Maritime Institute (Sep 26) — Jamaica Observer, Kingston, Jamaica, West Indies
In June this year, the Cabinet approved the opening of negotiations with Exmar for establishing a floating storage and regassification facility at Port Esquivel, St Catherine, that, the administration says, will result in Jamaica enjoying cheaper and cleaner natural gas by 2013.
Oregon asks Federal Court to dismiss Pacific Connector Pipeline suit — LNG Law Blog
Last week, the State of Oregon filed a motion to dismiss in a suit brought by Pacific Connector Gas Pipeline LP, a project associated with the Jordan Cove LNG project. The motion to dismiss argues that the court does not have jurisdiction and that Pacific Connector's claims should have been brought before FERC.
Could making methane hydrates help get gas off North Slope? (Sep 26) — Petroleum News, Anchorage, AK
Hydrates vs. LNG vs. pipelines
Hydrates are cheaper to make than liquefied natural gas because they form at a much lower temperature, around 14 degrees Fahrenheit for hydrates compared to minus 260 degrees for LNG. That means hydrates require less energy to produce than LNG and can be stored in simple refrigerated trucks, like those commonly used by food distributors.
As with LNG, the process of making and unmaking methane hydrates leads to a loss of some of the resource, a problem not encountered with a traditional pipeline. “You lose some with transportation, but it’s nowhere near as much as you [lose] with LNG,” Taylor said, estimating a 10 percent loss with hydrates compared to a 25 percent loss with LNG.
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LNG import's dismal future
Shale gas plus LNG may affect natural gas prices for years, maybe decades — Gerson Lehrman Group
Forecasts of a few years ago that LNG imports would rise dramatically have vanished. today the US is self-sufficient and may become an exporter. [Bold red emphasis added.]
Green light for US to begin LNG exports (Sep 27) — Petroleum Intelligence Weekly, Energy Intelligence [Paid subscription required]
The US government's recent authorization of natural gas exports from Cheniere Energy's Sabine Pass LNG terminal in Louisiana represents a milestone for the North American gas market and for the development of the region’s unconventional gas resources, a phenomenon which has already dampened US LNG imports and may now create the scope for excess gas to compete on world markets.
[Bold red emphasis added.]
Analyst: Low-demand LNG import terminals must 'get creative' (Sep 23) — SNL
"For companies that built speculative terminals, it's time for them to get creative and accept that the U.S. is not and probably will not be as attractive a market for LNG as everyone expected," Kelly Bennett, a senior energy analyst at BENTEK Energy LLC, told SNL Energy.
Bennett differentiated between two types of LNG import terminals. Terminals built to serve a well-defined market are in a solid position, even in current conditions. He said the Everett LNG import terminal in Greater Boston is a good example of this type. The Everett terminal is owned and operated by GDF SUEZ Gas NA subsidiary Distrigas of Massachusetts LLC and was built in the early 1970s to serve a supply-constrained market at the end of the interstate pipeline system in the Northeast.
"In terms of performance today, Everett has the highest capacity utilization rate of all the terminals in the U.S.," Bennett said. However, even Everett is running at about 50% of capacity, he said.
Bennett and BENTEK Managing Director E. Russell Braziel said in August that current conditions of abundant supply and low prices would keep most North American LNG import proposals — those that are still in the planning stage after being conceived in the heady days following 2000 — from seeing the light of day. [Red & bold emphasis added.]
Regulators don't [budge] on Savannah LNG truck meeting date — Savannah Morning News, Savannah, GA
City officials will be out of the country; hospitals wanted more time to study risks
Both Savannah Mayor Otis Johnson and Acting City Manager Rochelle Small-Toney are on a trade mission to China that has them returning to Savannah just as the Federal Energy Regulatory Commission's meeting begins at 7 p.m. at the Hilton Garden Inn Savannah Midtown.
From the outset, Small-Toney said, Southern LNG has not shared information with the city. That's a concern because the fire department and other city of Savannah emergency personnel, with the only Hazardous Material Response Team in the area, would be the primary responders if an accident happened.
The company's apparent lack of transparency comes on the heels of another spat it had with the city, said Savannah spokesman Bret Bell. In 2008, Southern LNG signed a contract with Southside Fire and Emergency Services as its primary fire protection after Savannah Fire/EMS billed it for almost $500,000 in unpaid fire protection fees. City officials only learned about the deal after it was inked. [Red, yellow & bold emphasis added.]
FERC must retain authority over LNG siting, Jordan Cove executive says (Sep 22) — SNL
U.S. Rep. David Wu, D-Ore., introduced the bill, called the Local Control for Energy and Environment Act, on Sept. 14. Among other changes, the bill would strike Section 311 from the Energy Policy Act of 2005, which would strip from FERC its authority over construction, expansion and operation of LNG facilities and return that authority to the states.
In addition to the assertion of state authority in the bill, Oregon has tried to claim more of a role over the gas pipeline that would be Jordan Cove Energy's link to the interstate pipeline system. Pacific Connector Gas Pipeline, a subsidiary of Williams Cos. Inc., filed suit against the state on Aug. 27, charging that two Oregon land agencies had deliberately attempted to thwart the project. The agencies required the pipeline to obtain landowner signatures before they would process permits for the project. FERC cannot grant the pipeline eminent domain power under the Natural Gas Act until the state issues the permits, which would not happen if landowners refused to sign.
Dedicated maritime operations weather service launched (Sep 23) — Modern Power Systems, Foots Cray, Sidcup, Kent, England, UK
BMT Argoss, a subsidiary of BMT Group Ltd, has launched a dedicated 24/7, 365 days a year operational, maritime weather forecasting centre to provide support for customer operations such as platform installations and maintenance, near shore cable laying operations, dredging works, ongoing LNG terminal operations, and other marine activities. The service is designed to help to optimise operability and minimise risks due to unexpected and unfavourable weather conditions.
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Calais LNG stymied by US Coast Guard decision
Calais LNG must have Canadian cooperation — Saint Croix Courier, St. Stephen, NB
U.S. Coast Guard says international agreements vital to LNG plan
The U.S. Coast Guard captain of the port for Northern New England, Captain J.B.McPherson, submitted his waterway suitability analysis and letter of recommendation to the Federal Energy Regulatory Commission (FERC) Tuesday.
The analysis refers to “the development, by the applicant, of standard operating parameters approved by the U.S. Coast Guard and coordinated with the government of Canada to enable the safe and secure movement of LNG tankers through Canadian and U.S. waters.”
…“The government of Canada has repeatedly and firmly stated at the highest level that LNG transits are banned from Passamaquoddy Bay, indicating Canadian safety and security cooperation will not occur.” [Red, italic & bold emphasis added.]
Coast Guard requirement for Canadian support likely kills plans for Passamaquoddy Bay LNG terminal — Seafood News, Lexington, MA [Paid subscription required]
[SeafoodNews.com summary and content are not available without paid subscription. — SPB webmaster]
Charlotte-Campobello's new dawn — Telegraph-Journal, Saint John, NB
Harvey and Craig both prominently oppose the plans for liquefied natural gas plants on the Maine side of Passamaquoddy Bay. Huntjens spoke against these proposals. Malloch, a fisherman, does not want LNG tankers in the bay. Liberal Premier Shawn Graham opposes the plans, too, publicly disagreeing with Maine Gov. John Baldacci.
As mayor of St. Andrews, Craig led the charge against the proposal by Jamer Materials to open a new stone quarry at Bayside. Huntjens opposed this project, too. Jamer would not find too many supporters among the Greens or New Democrats. Liberal Environment Minister Roland Haché killed the project in the end.
Conservative MP Greg Thompson spoke as loudly as anyone against both the LNG and Jamer proposals, leading to interesting political alliances crossing party lines.
Christopher Jylkka: Bearish winter for natural gas — Seeking Alpha
One thing that people fail to consider is that a few years back, people thought we'd run out of reserves for gas, and there was a big build-out for LNG. The aftereffect of that was that they had to build liquefaction capacity, where they take the gas, liquefy it, ship it out and then re-gassify it. So this infrastructure was built and never used. There's a tremendous amount of idle infrastructure.… [Red, yellow & bold emphasis added.]
Q&A: will shale revolutionise gas? (Sep 23) — BBC
US shale gas production has increased from almost nothing in 2000 to a 20% share of gas production in 2009, with some analysts projecting a 50% share by 2035.
It is noticeable that in the US and Canada - where shale is having the biggest immediate impact - prices fell by more than half in 2008-09, much more sharply than in Europe. [Red, yellow & bold emphasis added.]
Electric vehicles hold greater promise for reducing emissions and lowering U.S. oil imports — REVE
The Baker Institute researchers foresee natural gas -- reinforced by recent discoveries of vast reserves of shale gas -- playing "a very important role in the U.S. energy mix for decades to come." Under a business-as-usual approach, the United States won't have to import any LNG for decades. And the growth of natural gas will help the environment by lowering the demand for coal.
[Red, yellow & bold emphasis added.]
In praise of shale gas (Sep 22) — Pittsburgh Post-Gazette, Pittsburgh, PA
From a national security perspective, the ramp up in domestic gas production has been a big plus, turning what had been a challenging outlook for natural gas into abundant supplies. Consequently, the need for additional terminals to handle imports of liquefied natural gas has evaporated, reducing the possibility that the United States could become dependent on foreign countries for yet another fuel besides oil.
[Red, yellow & bold emphasis added.]
Just a drill (Sep 23) — The Jamestown Press, Jamestown, RI
Members of Jamestown Boy Scout Troop 1 did an ‘outstanding’ job of playing the victims during a JEMS mass casualty drill on Sept. 16. In the mock scenario, [an] LNG transport tanker exploded, sending resultant shock waves and flying shrapnel toward residents relaxing near the Jamestown Boat Yard. Within 25 minutes of being dispatched by Incident Command, all 25 patients had been found, triaged, transported to the treatment area and designated for transport off island to trauma and medical centers. All responders and patients then enjoyed pizza together.
Turbine question won’t be on November ballot (Sep 23) — The Jamestown Press, Jamestown, RI
Council members also agreed to proceed with a plan to endorse a statewide divestiture of equity holdings in Amerada Hess, which seeks to build a LNG facility in Mt. Hope Bay with its Weaver’s Cove LLC partner. [Red emphasis added.]
New Jersey lawmakers to vote on resolution opposing LNG projects — LNG World News
Citing LNG as an expensive fossil fuel that increases the United States’ reliance on foreign fuels, Senate Resolution 58 proposes support for increased energy efficiency and energy conservation, as well as the promotion of renewable energy technologies and projects. Sponsored by Republican Sen. Sean Kean and Democratic Sen. Robert Gordon, the resolution notes that New York and Connecticut rejected an LNG proposal for the Long Island Sound, instead offering two potential sites off the New Jersey coast and south shore of Long Island. [Red & bold emphasis added.]
Golden Pass preps for first cargo (Sep 23) — Upstream Online
Golden Pass LNG, a joint venture between Qatar Petroleum, ExxonMobil and ConocoPhillips , said yesterday in a letter to FERC that the first phase of construction is nearly complete and that it is ready to begin importing LNG for testing.
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US natural gas glut giant tramples LNG imports
Shale gas means flat prices till 2020 — Forbes
Oil production may have peaked in the U.S. in the early 1970s but fears of dwindling natural gas reserves, which were prevalent even a few years ago, have been demolished by the discovery of huge new shale-gas deposits. Gas prices will likely remain flat at around $5 per 1000 cubic feet through 2020, changing assumptions about everything from the viability of green-energy projects to the prospects of a pipeline to bring stranded gas from Canada to the U.S.
The Marcellus Shale formation alone, spreading from New York to West Virginia, is believed to contain at least 700 trillion cubic feet of economically accessible gas, a 30-year supply at U.S. rates of consumption.
“You can’t in that time frame come up with enough demand to soak this up,” said Robert Ineson, a gas expert with IHS CERA, speaking at the IHS Global Pacesetters energy conference in Greenwich, Conn.
[Red bold emphasis added.]
US Freeport LNG set to re-export cargo by early Oct — London South East, Rochford, Essex, England, UK
It is a symptom of over-supply in the U.S. gas market and the subsequent weak prices which have deterred shippers from sending much LNG to U.S. terminals this year.
Sabine Pass and Freeport -- currently the only U.S. terminals that can re-export LNG -- have together exported 9.7 bcf of gas since they received the approval last year, according to Waterborne Energy analysts in Houston. Sempra Energy's Cameron LNG terminal in Louisiana has recently applied for a re-export license.
Cheniere has gone one step further, planning to build a liquefaction plant that would export domestically-produced gas. Freeport LNG is also considering its options in that area, Mallett said. [Red & bold emphasis added.]
US Coast Guard says Calais LNG site suitable for tanker traffic — Platts
The approval comes after a string of bad news for the project. In July,
managing member GS Power Holdings, a subsidiary of Goldman Sachs Group,
announced it wanted to sell its interest.
Coast Guard: Waterways suitable for proposed Calais LNG facility — MPBN
Backers of the project are still trying to nail down financing, but the finding is a step forward in the federal approval process, says Maine Sen. Susan Collins. [Brown & bold emphasis added.]
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US LNG need in longterm nosedive
Abundance of unconventional natural gas changing the industry landscape — PR-USA.net
The North American natural gas industry is expected to witness a steady growth in production from 72.4 Bcf/d in 2008 to 82.1 Bcf/d in 2020, at an AAGR of 1.2%. The unconventional natural gas is expected to account for 52% of the total production in 2020. In US, the unconventional natural gas already accounts for approximately 50% of the production. By 2020, the share is expected to increase to 58%. In Canada, the unconventional natural gas production is expected to account for 30% of the production in [2020], up from approximately 5% share in 2008.
LNG supply and shale gas create “tough phase” for prices (Sep 14) — Pipeline and Gas Technology, Houston, TX
Although global LNG demand dropped substantially, the supply of LNG increased. New LNG liquefaction plants began operations in Qatar, Yemen, Indonesia and Russia. A major part of this increasing liquefaction capacity was intended for the U.S. market, which was at one point struggling with decreasing gas production. However, with new production from shale-gas basins, U.S. demand for LNG has fallen even further.
World energy map is constantly changing (Sep 20) — Telegraph.co.uk
Russia is the world’s largest pipeline gas exporter, supplying one-third of the European Union’s consumption, but it is now facing competition from shale gas, the largest reserves of which are found in the US.
A Massachusetts Institute of Technology study has predicted that natural gas will provide 40 per cent of America’s energy needs in the future, up from 20 per cent today, thanks in part to the abundant supply of shale gas. [Red, yellow & bold emphasis added.]
Maine waterway deemed OK for LNG tankers — (AP) The Portland Press Herald, Portland, ME
PORTLAND — The Coast Guard says waters leading to a proposed liquefied natural gas facility in the eastern Maine town of Calais are suitable for LNG vessels.
We're eager to actually read the Coast Guard's Letter of Recommendation regarding use of the waterway by Calais LNG, since it is likely — as it was with Downeast LNG — to have conditions that the developer cannot possibly meet.
But, in any case, the reality is that Calais LNG — like Downeast LNG — are about a decade too late; the US natural gas market has been turned on its head. There is so much domestic natural gas supply that US LNG import terminals are hurting, with no relief in sight.
Calais LNG granted further delay despite objections (Sep 17) — Saint Croix Courier, St. Stephen, NB
CALAIS – The chair of the Maine Board of Environmental Protection has agreed to a further delay in the Calais LNG application proceedings despite objections from opponents.
Calais LNG gets another extension to find financial backer (USA) (Sep 17) — LNG World News
In recent years, other proposed LNG import projects have been scrapped due to large increases in natural gas production from unconventional sources like shale in the United States. The United States now has comfortable supplies of its own and many existing LNG terminals — built on the expectation that the U.S. would be importing a lot more gas — now sit idle for much of the year. [Red, yellow & bold emphasis added.]
FERC to prepare EA for Elba Island LNG truck delivery proposal (Sep 20) — LNG Law Blog
Last week FERC announced its intention to prepare an Environmental Assessment of the proposal by Southern LNG to restart its truck loading operations at the Elba Island LNG terminal.
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Calais LNG in a holding pattern; BEP sanctions delay on permit [Blog] — CLF Scoop, Conservation Law Foundation
The Maine Board of Environmental Protection granted Calais LNG an additional 30 days to find another investor for their proposed LNG facility in Calais, ME, plus six additional weeks to gather other information requested by the BEP. The extra time effectively extends a hold on the company’s permit application until December 1. The decision was made after a hearing Wednesday, which the company had asked to postpone as well — a request that the BEP denied.
After two prior 30-day postponements to allow Calais LNG to find another financial backer after GS Power Holdings backed out of the project, which set the deadline to find funding or withdraw all applications at August 11 and September 11, respectively, CLF is “not surprised, but…a little disappointed the extension didn’t include a real deadline, after which the application would be returned,” CLF’s Maine Advocacy Center Director Sean Mahoney told the Portland Press Herald in an article published today.
Calais LNG gets more time, again, to raise cash — Bangor Daily News, Bangor, ME
AUGUSTA, Maine — The chairman of the Maine Bureau of Environmental Protection board has granted another extension to Calais LNG, giving the cash-strapped company until Dec. 1 to file its completed application to build an up to $1 billion liquefied natural gas facility at Red Beach in Calais.
Excelerate in slow talks to offer Gulf LNG import (Sep 16) — Reuters
NEW YORK, Sept 16 (Reuters) - U.S. liquefied natural gas terminal operator Excelerate Energy is in talks with three companies to offer import capacity at its Gulf Gateway terminal offshore Louisiana, the company's chief commercial officer told Reuters on Thursday.
However, a deal could be hard to come by at this time given weak U.S. gas demand and ample domestic supply which has deterred shippers from sending much LNG to U.S. terminals this year, said Excelerate's CCO, Andree Stracke.
The Gulf Gateway terminal, which can send up to 690 million cubic feet of gas per day into the grid and began operations in 2005, has sat idle over the last couple of years as U.S. gas prices slumped under the weight of increased domestic supply from unconventional sources such as shale.
A number of terminals onshore the U.S. Gulf Coast have received only sporadic volumes this year. This has led many operators to change strategies. Some are offering import capacity, others have applied for re-export licenses, and one -- the Sabine Pass terminal in Louisiana -- is proposing to build a liquefaction plant to export U.S. gas. [Red, yellow & bold emphasis added.]
State group pursues customers for proposed bullet gasline — Alaska Journal of Commerce, Anchorage AK
A bullet line from the North Slope using the Glennallen route is longer, a consideration with pipeline construction costs of about $5 million per mile, but Heinze has pointed out that a pipeline on that route would leave open the option of a separate spur line to a possible LNG project in Valdez.
[State gas corporation CEO Dan Fauske] said that a serious look at imported liquefied natural gas must be taken. Consideration of LNG imports will be included in his group's report next July, he said. Fauske also said he doesn't believe the bullet line project would preclude possible hydroelectric projects that could meet part of Southcentral and Interior Alaska's electricity needs.
Winter looks good for natural gas customers — NJ Spotlight, Montclair, NJ
Vast reservoirs of natural gas newly discovered in Marcellus Shale help drive prices down
Doubling Natural Gas Supplies
The big factor in the drop in rates is the discovery of massive amounts of natural gas supplies in the Marcellus Shale, which have effectively doubled the nation’s natural gas supplies, according to a study by the Massachusetts Institute of Technology.
The shale gas reserves found in neighboring states are supplemented by similar reserves found in more than half of the states across the country, including near major metropolitan areas, such as Chicago, Denver and Dallas. The discovery has helped stabilize natural gas prices, and, even lower the cost.
“The supply is adequate,’’ said [US Energy Information Administration analyst Neil Gamson], citing the discovery of shale gas reserves as a major factor. “Ten years ago, it wasn’t even on our radar screen. We thought LNG (Liquified Natural Gas) imports would have to make up the difference, but it doesn’t look like that will be the case for a while.’’ [Red, yellow & bold emphasis added.]
Analysis: Shale gas to play long-term role in global gas demand — Rigzone
"The unconventional natural gas business may have already changed the overall supply and demand balance in North America, and perhaps globally," said Barry Munro, Leader of Ernst & Young's Canadian oil and gas practice.
According to Munro, the current supply/pricing environment has also changed economics for conventional LNG projects in Canada, and arguably for every LNG project across the world. Again, challenging economics and restricted access to capital will alter any expected LNG supported demand growth in many regions.
[Red, yellow & bold emphasis added.]
Bentek: U.S. shale gas revolution drives a new world order in the global LNG market [News release] — BusinessWire
The shale phenomenon has increased U.S. production, put downward pressure on prices and dashed plans to ramp up U.S. LNG imports. At the same time, lower spot LNG prices have shifted global gas flow patterns, displaced traditional European pipeline supplies with LNG and accelerated demand growth in China, India, the Middle East and South America. A new, interconnected global gas market is emerging, with important implications for flows, prices and transportation options.
“The U.S. shale gas revolution has resulted in a massive reduction in the need for new LNG imports into North America — possibly even turning the U.S. into an exporter. …" [Red, yellow & bold emphasis added.]
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Calais LNG wins extension to nail down financial backers — MPBN
Maine's Board of Environmental Protection says the company now has until December 1st to line up financial backers for its proposed liquified natural gas terminal in eastern Maine.
"In light of the significance of this project in terms of scope, complexity, and cost, as well as the time spent and expenses incurred by the parties and the Department thus far in the processing of the pending applications, it is reasonable to allow the applicant the requested time to complete refinancing negotiations and provide the information required by the Department without withdrawal of the applications," [BEP Chair Susan Lessard] writes.
"We think that they've had more than adequate time to find financing for the project," says Sean Mahoney of the Conservation Law Foundation. "We continue to believe that the impacts of the project on the natural resources and the existing uses up in Passamaquoddy Bay are inappropriate and the lack of any need for the project makes those impacts even more inappropriate." [Red, yellow & bold emphasis added.]
LNG developer gets more time — Portland Press Herald, Portland, ME
In mid-July, Calais LNG surprised the board by asking it to postpone a long-anticipated hearing on the project. The company said it needed more time to get material to the Department of Environmental Protection.
A week later, it revealed that its lead financial backer, GS Power Holdings LLC, was pulling out of the project. It told the board that if the Goldman Sachs subsidiary couldn’t sell its ownership interest by Aug. 11, all permit applications would be withdrawn.
But a month later, Calais LNG sent word to the board that it needed another 30 days to line up a financial backer. The board consented.
Earlier this week, the company asked the board to cancel a meeting set for Wednesday between the parties in the case and to keep its permit application on hold until mid-October, while negotiations continue….
Based on that meeting, she decided to grant the company’s request for another 30 days to find a new investor, plus another six weeks to gather technical information requested by the Department of Environmental Protection.
… Sean Mahoney, vice president at the Conservation Law Foundation said “…we’re a little disappointed the extension didn’t include a real deadline….”
…Ron Shems, a lawyer representing Save Passamaquoddy Bay and native tribes [stated that] [t]he project should have financing before applying for a permit… and the board should be asking for some assurance. [Red, yellow & bold emphasis added.]
Alabama governor approves offshore LNG terminal — Oil & Gas Journal
TORP Terminal Chief Executive Officer Joseph P. Berno, in response to OGJ questions, said TORP still requires a license from the US Department of Transportation’s Maritime Administration to “own, construct, and operate” the Bienville terminal as well as “all applicable permits” from the US Environmental Protection Agency and state agencies to construct and operate the terminal.
Liquefied natural gas terminal south of Dauphin Island approved — Press-Register, AL
“We’re happy to come up with a solution that we feel continues to be environmentally sensitive, while also being commercially competitive,” [TORP Terminal CEO Joe Berno] said. “It’s probably more expensive all the way around, to be honest with you, but it’s the cost of doing business.”
Riley approves natural gas terminal off Ala. coast — OANow.com, Opelika, AL
TORP Technology originally proposed an "open loop" system that would have used massive amounts of Gulf seawater to warm up the gas, which has been chilled to minus 260 degrees and is known as liquefied natural gas, or LNG. The governor, with authority under the federal Coastal Zone Management Act, rejected that plan in 2008.
Two years earlier he had rejected a similar plan by ConocoPhillips to build an LNG operation with the "open loop" technology 13 miless out from Dauphin Island.
"Governor Riley has been tenacious in protecting the state's marine resources," Callaway said in a statement released by the governor's office.
FERC sets public comment deadline in Cameron LNG re-export proceeding — LNG Law Blog
FERC has set October 7, 2010, as the deadline for public comments regarding Cameron LNG's proposal to re-export foreign-sourced LNG.
Cheniere LNG saved by shale gas (Sep 15) — Gerson Lehrman Group
Cheniere was the leading LNG import pioneer with Sabine Pass and one additional Gulf Coast LNG receiving terminal project (Corpus Christi) when forecasts of U.S. natural gas ("NG") shortages were predicted since 1998 in the order of 20 bcfd by about 2015. Twelve LNG receiving terminals were reactivated and/or newly constructed such as Sabine Pass, being the largest with a capacity of about 4 bcfd. However, all parties miscalculated and did not consider the advances in shale gas developments in Texas, Louisiana, Arkansas, Oklahoma and the Marcellus play on the East Coast. As shale gas became the price bench mark of $4/million btu (mbtu) for NG, the import of LNG o the US declined to less than 1.5 bcfd and Cheniere nearly went out of business.
The low price of shale [natural gas] at $4/mbtu makes a liquefaction plant attractive for export of LNG to the world market provided DOE gives approval for export. [Red, yellow & bold emphasis added.]
Gas prices may be affected by pending ConocoPhillips export permit — KTUU-TV, Anchorage, AK
NIKISKI, Alaska — ConocoPhillips and Marathon are trying to get an extension on the permit that allows them to export natural gas overseas. They argue that without it, customers here in south central Alaska would run into serious problems come winter.
Asia could use Alaska's gas, but so could Alaskans who want assurance their local supply is not all going overseas. That's where the federal government comes in.
Cook Inlet gas basins are declining in production and the LNG plant is only at half-capacity, so it's a careful balance between Alaska and Japan.
Wu introduces bill to return state control over LNG decisions — Willamette Week, Portland, OR
Wu, who’s running for re-election in the First Congressional District against Republican Rob Cornilles, on Tuesday introduced the Local Control for Energy and the Environment Act. The bill would repeal portions of the 2005 Energy Policy Act that stripped away much of the decision-making power over LNG facilities from the states.
“It’s about bringing the state back into the process and ensuring Oregonians are able to determine the energy future of their own communities,” says Julia Krahe, a spokeswoman for Wu.
Natural gas weekly update (Sep 16) — U.S. Energy Information Administration, Washington, DC
A sharp reduction in imports of natural gas to the United States is also likely easing downward pressure on prices. During the report week, net Canadian imports hovered around 6.7 Bcf per day, about 13.0 percent lower than the comparable week last year, according to BENTEK. Additionally, the pace of deliveries of U.S. LNG imports in recent weeks has decreased considerably in comparison with year-to-date levels and from earlier this year. Sendout from U.S. LNG import terminals averaged 2.0 Bcf per day during the first 2 months of 2010, but during this report week averaged just 0.8 Bcf per day. This reduction in LNG imports is occurring at a time when many analysts had expected a greater number of LNG cargos to be directed to the United States, following production increases in countries such as Russia and Qatar. To the extent LNG cargos have flexibility in delivery locations, supplies are instead heading to Europe and Asia, where LNG prices remain higher than those that have prevailed in U.S. markets. [Red, yellow & bold emphasis added.]
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BEP refuses request for delay (Sep 14) — The Saint Croix Courier, St. Stephen, NB
Attorney Rebecca Boucher, of Shems Dunkiel Raubvogel and Saunders, notes in her letter on behalf of SPB-US and NN that this is Calais LNG’s fourth last-minute request – the first being their request to postpone the entire hearing disrupting the schedules of more than 100 witnesses.
“This repeated failure of the applicant to defend its requests for postponement has gone on too long. It is unreasonable for Calais LNG to expect the BEP, other state agencies and the parties to continue to enable secret negotiations during this public proceeding. Calais LNG itself initiated this public proceeding by submitting applications requiring evidence of financial capacity.”
BEP executive analyst Cynthia Bertocci has e-mailed all parties involved ito inform them that Lessard has decided that Wednesday’s conference will proceed and they will have the opportunity to comment on the impact of the most recent request to put the application on hold until mid-October. [Red, yellow & bold emphasis added.]
Calais LNG seeks more financing — New Brunswick Business Journal, Saint John, NB
The developers of a proposed liquefied natural gas terminal in Calais, Maine, have again requested that their regulatory application be delayed as they chase new funding for the project.
[I]t's unclear if Calais LNG's request for a 30-day delay will be granted.
In January, the Shawn Graham government called on the Federal Energy Regulatory Commission (FERC), the American regulator, to quash the proposed Calais terminal, saying the project poses "unacceptable risks to New Brunswick".
"…LNG vessel traffic is likely to impose a serious impact on commercial fishing, aquaculture facilities and Canadian tourism. Many New Brunswick citizens depend on the resources in this area for their livelihoods."
The province's letter also emphasized the Canadian government's position on the matter: that it will forbid LNG tankers from entering the bay.
The Graham government is also protesting a similar project under consideration by FERC. Downeast LNG, proposed for Robbinston, Maine, would sit directly across from St. Andrews, N.B. [Red, yellow & bold emphasis added.]
Maine/New England dispatches: Calais LNG attempt to delay meeting on updates denied — The Portland Press Herald, Portland, ME
In a letter late Monday, BEP Chairwoman Susan Lessard said today's meeting will proceed on schedule. Parties will have an opportunity to comment on the company's request to keep the application on hold until mid-October, she said.
Riley approves natural gas terminal off Ala. coast — CBS11TV, Dallas/Ft. Worth, TX
The TORP Technology facility got the governor's nod because the Texas company agreed to use an environmentally friendly method to reheat the gas that doesn't affect marine life. The company also has agreed to set up a $25 million fund to help with the protection, restoration and improvement of Alabama's marine life and coast.
Governor Bob Riley approves TORP’s application for the Bienville Offshore Energy Terminal — Environmental Expert
The Bienville Offshore Energy Terminal will use the award-winning HiLoad Technology and a floating regas ship with no permanent offshore structures. The Terminal will also utilize closed-loop ambient air vaporization, which is a preferred solution of the Environmental Protection Agency (EPA),National Oceanic and Atmospheric Administration (NOAA)and environmental groups.
DLCD rejects Bradwood proposal — The Daily Astorian, Astoria, OR [Paid subscription required]
Project ruled inconsistent with Coastal Zone plan
It could be a big blow to Bradwood.
Property owners fight natural gas pipeline — The Mail Tribune, Medford, OR
They have joined half a dozen property owners as interveners on the side of the state of Oregon, which was sued Aug. 27 by a company hoping to build a 234-mile natural gas pipeline from Coos Bay through the upper Rogue River watershed to Malin.
In the lawsuit filed in U.S. District Court in Eugene, Pacific Connector Gas Pipeline LP, a Salt Lake City firm that would operate the pipeline, accused the state of employing a "legal Catch-22" by requiring developers to obtain approval from the roughly 220 landowners whose property may be crossed by the pipeline before it will process the firm's removal-fill permit application for the project.
Shale gas prospects and safety — Energy Bulletin
Cheap gas coming?
…Last year, US natural gas production was 593 billion cubic metres compared to 524 billion in 2006. This sharp increase was completely unexpected. Before 2007, everyone thought US domestic gas production was about to slip into terminal decline with imports rising dramatically…
Already US investors in liquefied natural gas regasification plants have been badly hurt as the demand failed to materialise. [Red, yellow & bold emphasis added.]
Market price arbitrage? — Gerson Lehrman Group
US was seen as the LNG sink hole where the highest demand was expected by LNG project developers. The demand side forecast remains true - but who supplies that demand has changed. US domestic gas is now driving the supply leaving a number of LNG regas terminals in the US operating at well below capacity.
While the long term demand picture has not changed, in spite of the recession, the discovery of domestic gas and the availability of good infrastructures gave consumers of imported LNG a serious alternative. Increasingly, as supply shifts to domestic US gas, LNG regas terminals are either sitting idle or operating at well below capacity. In essence, the US is no longer as accessible nor as attractive as project developers once thought was the "obvious" market to sell to. [Red, yellow & bold emphasis added.]
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Calais LNG loses delay request
Environmental board rejects Calais LNG delay — (AP) Bloomberg Businessweek
SPB Webmaster's Note: This same story was published as…
- Maine environmental board declines to grant another delay for Calais LNG
- — The Washington Examiner
- — San Francisco Examiner
- Environmental regulators deny LNG meeting delay
- Environmental board rejects Calais LNG delay
- Environmental board declines to grant another delay for Calais LNG
AUGUSTA, Maine (AP) -- Opponents of a liquefied natural gas project in Down East Maine say environmental regulators have denied another request to delay a meeting.
Last month, Calais LNG received a one-month delay from state regulators to line up new investors after a Goldman Sachs affiliate withdrew from the project. But the Board of Environmental Protection rejected another request for a delay. That means a conference of all parties on Wednesday will proceed.
Board refuses to delay Calais LNG meeting — The Portland Press Herald, Portland, ME
In a letter late Monday, BEP Chair Susan Lessard said tomorrow's meeting will proceed on schedule. At the conference, parties will have an opportunity to comment on the impact of the most recent request to keep the application on hold until mid-October, she said.
In August, Calais LNG asked the board for time for its lead investor, GS Power Holdings, to find a new financial partner for the project. The new financing was supposed to be lined up by Sept. 11.
Calais LNG again seeks delay to find funding — Bangor Daily News
[Also published under the headline, "Augusta LNG talks to go as scheduled"]
A conference scheduled among the principles of Calais LNG, opponents and the state Board of Environmental Protection will be held as scheduled, despite Calais LNG’s last minute request to postpone the process while it seeks financial backing.
Cindy Bertocci, legal analyst to the BEP, said Tuesday that Chairman Susan Lessard received two requests from Calais LNG on Monday. One asked that today’s meeting be postponed and the other was a request for an additional 30-day delay in the company’s LNG site permit application deadline.
It was the company’s fourth request for a delay, with the previous three having been granted by state regulators.
On Monday, Calais LNG provided a status report to the BEP that said the company was still seeking investors.
A number of entities, including the Roosevelt Campobello International Park Commission and the Conservation Law Foundation, have filed formal objections to any application extension, noting that it was Calais LNG that asked for an expedited process. They are asking the BEP to force Calais LNG to adhere to the deadlines set and to withdraw its application until funding issues are settled. [Red & bold emphasis added.]
FERC Chairman responds to Bristol officials — LNG Law Blog
FERC Chairman Jon Wellinghoff has responded to a letter sent by two Bristol, R.I., officials to President Barack Obama regarding the Weaver's Cove LNG project.
Editorial: You choose: Hysteria or jobs? [Editorial] — The Providence Journal, Providence, RI
Which approach do you think politicians should take? Maintain the hysteria in the face of unbiased, comprehensive studies, or help create jobs and a future for those in southern New England who desperately want to work?
LNG trucking plans get more scrutiny — Savannah Morning News, Savannah, GA
Federal regulators announced Monday they'll be seeking additional public comment about plans to truck liquefied natural gas - LNG - through Savannah.
The Federal Energy Regulatory Commission will hold a scoping meeting on the subject at 7 p.m. Sept. 29 at the Hilton Garden Inn.
Johnson and acting City Manager Rochelle Small-Toney filed comments with regulators Monday after the mayor and some council members rebuked a company official at a city council workshop last week. In the written comments, city officials fault the company for not involving the city sooner and more thoroughly in the process, reneging on an earlier promise to refrain from trucking LNG, and not adequately analyzing and spelling out the risks involved. [Bold red emphasis added.]
Outlook for master limited partnerships and natural gas prices (Sep 13) — Seeking Alpha
Less than a decade ago, most industry analysts projected that the US would depend increasingly on imported liquefied natural gas (LNG).
Fast-forward to 2010. The biggest problem isn’t how to import more gas but what to do with the growing oversupply. Rapid production growth from fields such as the Barnett, Marcellus and Haynesville Shale has pushed US gas output to new heights. In 2009 the US overtook Russia to become the world’s largest gas producer. [Red, yellow & bold emphasis added.]
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Calais LNG requests extension to find investors — MPBN
In July the project suffered a major setback when the financial backer -- GS Power Holdings, a unit of Goldman Sachs -- announced it was selling its stake in the project….
"It's interesting that we're at this point and we still don't have any names," [Sean Mahoney of the Conservation Law Foundation] says. "If they're very serious about this they should share the names of people with counsel, subject to a confidentiality agreement. They haven't done that and we see no reason why they can't continue these discussions, but in the interim they should withdraw their application, without prejudice and refile it when they have their house in order."
"This is a project that we don't ever see being built, because the market is oversaturated right now," Mahoney says. "Just today the Federal Energy Regulatory Commission approved a request by an LNG import facility to export natural gas because there is no market for importing LNG."
[Red, yellow & bold emphasis added.]
Calais LNG requests [yet another] 30-day extension — MPBN
Today had been the deadline for Calais LNG to either announce that it has found a new backer or to withdraw its application for the project, which faces opposition from environmental groups.
BEP conference on Calais LNG postponed (Sep 10) — The Quoddy Tides, Eastport, ME
In other developments with the Calais LNG proposal, the company is floating the idea of a second natural gas pipeline through the state to be funded by the state. In an August 12 letter to Governor John Baldacci, Calais LNG Development Manager Art Gelber asks to meet with state officials to discuss the possibility of the state financing and owning a second natural gas pipeline along the proposed energy corridor along Interstate 95. The gas could be made available to industrial manufacturers and homeowners in Maine and Boston and other regions to the south. Although Calais LNG has been working with the Maritimes & Northeast (MNE) Pipeline on using its pipeline to transport its natural gas, Calais LNG also has been studying the possibility of a second pipeline. Gelber says he would like to discuss the option, which he terms "a more viable and less predatory alternative to MNE."
Save Passamaquoddy Bay has estimated that the cost could be around $686 million.
[Red, yellow & bold emphasis added.]
Our view: Regional commitment [Editorial] — The Herald News, Fall River, MA
Thumbs up to Coast Guard Deputy Commandant for Operations Brian Salerno, who affirmed the Guard’s previous decision that the Taunton River is “unsuitable for the type, size and frequency of LNG marine traffic associated with Weaver’s Cove’s proposal.” Salerno said in his letter to Weaver’s Cove CEO Gordon Shearer that he considers the matter closed, eliminating one of Weaver’s Cove Energy’s and Hess LNG’s options for an LNG processing facility along Fall River’s waterfront.
The energy companies are now limited to their second proposal of an off-loading station in the middle of Mount Hope Bay and storage facility at Weaver’s Cove on Fall River’s waterfront, an option Weaver’s Cove Energy insists it is still pursuing. That option is unlikely to proceed, however, given the overwhelming opposition to the plan from residents and local, state and federal officials. A highly populated neighborhood is not the place to store the volatile fuel, and the offshore processing station would hinder efforts to develop the waterfront.
A cheaper, safer way to move natural gas (Sep 7) — Technology Review, MIT, Boston, MA
A new transport method involving ice crystals could make it practical to get natural gas from remote areas, with no worries about explosions.
Storing and shipping natural gas by trapping it in ice--using technology being developed by researchers at the U.S. Department of Energy--could cut shipping costs for the fuel, making it easier for countries to buy natural gas from many different sources, and eventually leading to more stable supplies worldwide.
The DOE researchers say the approach could also be safer than current methods of shipping natural gas, such as cooling it to produce liquefied natural gas (LNG), since there is no danger that iced natural gas will explode if the shipping container is damaged.
The results of a methane hydrate demonstration project in Japan by Mitsui Engineering & Shipbuilding, a large maker of ships for transporting oil and natural gas, suggested that the total cost of transporting methane hydrate--including the infrastructure required to make it and release the gas at its destination--could be "much lower than that of LNG," according to the company.
The snow-like hydrate can be packed into cubes and loaded into the refrigerated ships, boxcars, and trucks now used to ship frozen food at -10 °C. That temperature is far easier and cheaper to manage than the -162 °C required for LNG.
How is it that FERC and the LNG industry repeatedly claim LNG cannot explode, but the US Department of Transportation indicates that LNG can explode, and that methane hydrate is safer than LNG since methane hydrate cannot explode?
Natural gas could be moved as ice crystals (Sep 7) — Softpedia
At this point, it's not exactly practical to move natural gas around too much, because the chemical is unstable, and the risk of explosions is omnipresent, Technology Review reports.
Unconventional resources hold promise, uncertainty in Canada: Ernst & Young [News release] — (Canada NewsWire) Digital Journal
MONTREAL, Sept. 13 /CNW/ - Long-term growth in shale gas production is expected to play an important role in shaping North and South American, as well as European and Asian natural gas demand, according to a new report released today by Ernst & Young at the World Energy Congress.
"The unconventional natural gas business may have already changed the overall supply and demand balance in North America, and perhaps globally," said Barry Munro, Leader of Ernst & Young's Canadian oil and gas practice.
According to Munro, the current supply/pricing environment has also changed economics for conventional liquefied natural gas (LNG) projects in Canada, and arguably for every LNG project across the world. [Red, yellow & bold emphasis added.]
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Canadian, Russian businessmen meet at energy forum — ITAR-TASS News Agency, Moscow, Russia
The president of the Rabaska Company expressed the hope that dynamics of prices in the North American gas market will open a possibility of importing liquefied natural gas from Russia for a terminal in Quebec City.
Does the Bay State need an LNG terminal? (Sep 13) — Worcester Business Journal, Worcester, MA
One expert, however, is skeptical about who will ultimately gain from an LNG terminal. Christian Hosford, an engineer at CHI Engineering Services in Portsmouth, N.H., has worked in the LNG field since the early 1970s. He said that the national economy has seen consistent trends that don’t bode well for the long-term success of an LNG terminal in Fall River.
…Hosford is reluctant to proclaim that a new and improved LNG port in Fall River will have a positive impact on the citizens of the state. In fact, he added, the trend throughout the past few decades has been that the LNG terminals open and close but the taxpayers pay the price. [Red, yellow & bold emphasis added.]
LNG trucks: Get the answers [Editorial] (Sep 11) — Savannah Morning News, Savannah, GA
The mayor and council were told last week that Southern LNG agreed in 2001 not to truck LNG to and from Elba Island. The agreement was reached with then-City Manager Michael Brown.
The reason was safety. The company, which is based in Birmingham, Ala., and is owned by the El Paso Corp. in Houston, was reactivating its long-mothballed storage tanks and unloading facility along the Savannah River back in 2001.
Since the company struck a deal, then it must act in good faith if it wants to change it. It should be completely transparent with Acting City Manager Rochelle Small-Toney and others who represent the city today.
The learning curve is already beginning. Last Thursday, Savannah Fire & Emergency Services Chief Charles Middleton expressed concerns about what could happen if the super-cool liquid escaped as a vapor, which is when it's flammable. Mr. Hughes responded that the vapor, which is lighter than air, quickly rises. Hence ignition is difficult. [Red, brown, and bold emphasis added.]
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Island hosts first LNG Congress of Councils (Sep 9) — The Jamestown Press, Jamestown, RI
“[T]here are many opportunities to draw attention to the flaws in the Hess LNG proposal.”
Stone spoke to “market factors” indicating that “the profit opportunity has collapsed.”
Four terminals serve New England, he said, and during the question-and-answer portion of the program, he said that three out of four of those facilities are operating at “10% under capacity.”
We think that they will never be able to satisfy that [exclusion zone] condition,” she said, because “it is not a safe location under the DOT siting rules.”
Congressional candidates pledge opposition to Weaver's Cove LNG project — LNG Law Blog
All four candidates seeking their parties' nomination for the November congressional election for Rhode Island's first congressional district told the Jamestown Press that they oppose the current plans for the Weaver's Cove LNG import project.
Savannah City Council blasts LNG trucking response (Sep 9) — Savannah Morning News, Savannah, GA
He came offering an apology, but by the time Bruce Hughes, president of Southeast LNG, finished his presentation, Savannah City Council members were even more determined to oppose the company's proposal to truck liquefied natural gas through the city.
"I'm prepared to struggle against this on principle alone until you're prepared to sit down together and have a real, honest discussion about this proposal," Johnson said. "... We have an obligation to the citizens who elected us to protect them from hurt and harm and undue risk."
Despite Hughes' repeated assurances that liquefied natural gas cannot explode and is not combustible, council members and Savannah Fire & Emergency Services Chief Charles Middleton had concerns about what could happen if the liquid escaped as a vapor. That, too, poses little risk, Hughes said, because the vapor, being lighter than air, quickly rises.
Acting City Manager Rochelle Small-Toney told council that in 2001, then-City Manager Michael Brown had an agreement from Southern LNG - which was seeking to reactivate its Elba Island terminal - that the liquefied gas would not be trucked to and from the facility. [Bold red emphasis added.]
News bodes ill for Downeast LNG & Calais LNG
Sabine Pass LNG gets approval to export US natural gas (Sep 9) — FOXBusiness.com
The approval, granted Sept. 7, puts the terminal in Cameron Parish, La., one step closer to becoming the first facility to export natural gas produced in the Lower 48 states, drawing supply from the burgeoning unconventional gas fields in Texas, Louisiana, Arkansas and Oklahoma.
The proposal underscores how the natural-gas supply picture in the U.S. has turned from scarcity to overabundance, thanks to the exploitation of rock formations called shales.
It also marks a radical shift in the plans of companies such as Cheniere, which once planned to profit from building multi-billion-dollar [regasification] terminals in different U.S. coastal locations. But the natural-gas shale boom brought those plans to a halt. North America's new gas wealth has prompted other export projects, such as Apache Corp.'s proposed facility in British Columbia, which aims to supply Asia with large quantities of Canadian natural gas. Natural gas, usually shipped through pipelines, has traditionally been a regional market; but when it is converted into liquid it can be shipped overseas.
Gas-bearing rock formations known as shales have changed the view that domestic U.S. natural-gas output would decline and that new supplies would have to come into the U.S. from other countries. In fact, these new supplies have depressed gas prices, discouraging gas imports that were once thought critical to feed growing demand for the fuel. [Red, yellow & bold emphasis added.]
Update 2-Cheniere gets DOE approval to export LNG from Sabine — Reuters Africa
-
Cheniere will be able to export 16 mtpa for 30 years
-
Sign of ample US natural gas supply
The U.S. has received only light volumes of LNG this year, as ample gas supply, thanks to an increase in shale production, and weak demand have pressured gas prices and deterred shippers from sending much LNG there.
Plans for new U.S. import terminals have been scrapped and existing terminals are shifting strategies. Some, including Sabine Pass, now have the ability -- and approval -- to re-export previously imported LNG to higher-paying markets elsewhere.
Cheniere cleared to export US LNG from Sabine Pass as Sempra seeks approval to re-export cargoes from Cameron LNG — Gas Matters, Gas Strategies, London, England, UK [Paid subscription required]
The bleak outlook for US LNG imports was emphasised this week after the US Department of Energy (DoE) September 7 granted Cheniere’s request to export up to 16 mtpa of LNG from its Sabine Pass terminal in Cameron Parish, Louisiana.
[Red, yellow & bold emphasis added.]
DOE approves Cheniere to export LNG from Sabine Pass — PennEnergy
Shale Gas Could Make the US a Major Exporter
Spurred by increase in natural gas production in the US, the export facility [the largest LNG regasification terminal in the world] would be the first in the country in 40 years. Shale gas production has skyrocketed across the continental US, and LNG export would help relieve the influx of gas into the domestic market.
… “The US is experiencing an increase in natural gas production, primarily driven by unconventional gas plays, while natural gas demand in the US continues to lag behind market projections. Due to the depth of the markets in South Louisiana with an abundance of supply and existing pipeline infrastructure, we can provide an additional outlet for US natural gas production while offering a low cost source of supply for global buyers seeking alternatives to oil-indexed contracts."
The conversion is expected to take place in two phases. The first would build two LNG trains each capable of processing 3.5 million tons per year with a combined liquefaction capacity of about 1 billion cubic feet per day.
The second phase of development would add another two LNG trains taking capacity to 2 billion cubic feet per day. This phase would be considered in the future based on customer interest.
Currently, there are three Gulf Coast LNG import terminals seeking permission to export. Others include Freeport LNG in Texas and Sempra LNG in Louisiana. The Freeport LNG project is similar to the Sabine Pass conversion, but the Sempra LNG project is going to be a re-export project only. [Red, yellow & bold emphasis added.]
Increased activity at Freeport LNG terminal — LNG Law Blog
Platts LNG Daily [subscription required] reports that two LNG cargos are expected to arrive at the Freeport LNG terminal by the end of the week. The LNG River Nigeria arrived at the facility on Wednesday and the Maersk Meridian is expected to arrive at the terminal today.
Separately, Bloomberg reports that an LNG vessel left the Freeport LNG terminal earlier this week carrying a re-exported LNG cargo. The news report suggests that the vessel is headed for an Asian destination.
[Red & bold emphasis added.]
Kenai LNG owners press DOE for expeditious extension decision (Sep 12) — Petroleum News
ConocoPhillips and Marathon Oil have asked the U.S. Department of Energy for two additional years to ship Alaska LNG to Asian markets. A group of seven Democratic lawmakers believe the export license should only be extended if the terms of a 2008 settlement between the State of Alaska and the two companies are also extended.
That settlement required the companies to meet local needs before shipping natural gas abroad, and to open their facility to third parties, among several other terms.
Coos County grants conditional LNG pipeline permit (Sep 9) — KDRV-TV, Medford, OR
COOS BAY, Ore. -- Coos County commissioners have granted final approval to a conditional land-use permit for the Pacific Connector liquified natural gas pipeline.
Several property owners along the pipeline route who attended the Wednesday meeting said they were unhappy with the decision. Opponents have 20 days to appeal.
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Text:EIA Energy Outlk: 2011 oil demand revised to +1.4m b/d -2 — iMarketNews.com
EIA forecasts gross pipeline imports of 9.2 Bcf/d in 2010, an increase of 1.3 percent from 2009. Forecasted imports of liquefied natural gas (LNG) average 1.25 Bcf/d in 2010 and 1.32 Bcf/d in 2011. Low U.S. prices have discouraged imports, and ample domestic natural gas production has reduced the need for large quantities of LNG despite significantly higher consumption. [Red, yellow & bold emphasis added.]
Wall Street giant Goldman Sachs fined £20m by UK's FSA — BBC News, UK
The fine is for failing to tell the FSA it was under investigation for fraud by the US financial watchdog this summer.
In July, Goldman settled the fraud charge with the Securities and Exchange Committee by paying $550m (£356m).
Aquidneck Island communities send officials to Jamestown to fight LNG — Middletown Patch, Middletown, RI
The Congress of Councils met Wednesday at the Jamestown Recreation Center, bringing together more than 100 state and local officials from municipalities in Rhode Island and southeastern Massachusetts, including Middletown, Portsmouth and Newport.
More than 100 concerned residents and elected state and local officials representing Aquidneck Island, Southern Rhode Island and Massachusetts turned out in Jamestown Wednesday morning to show a unified front to fight a proposed liquefied natural gas (LNG) off-shore facility in Mount Hope Bay with a terminal in Fall River, MA.
LNG presents plans to haul trucks down DeRenne Ave. — WSAV-TV, Savannah, GA
The city is expected to oppose the proposal in today's council meeting.
Savannah Mayor and Council scolds LNG Southeast — WSAV-TV, Savannah, GA
Mayor Otis Johnson says it's a case of insensitivity and disrespect .... concerns the Mayor made known to LNG's President at today's council workshop.
Almost three weeks ago LNG held a community meeting. It was a way to inform others of their proposal to truck Liquefied Natural Gas from a new facility on Elba Island down DeRenne.
The meeting was mandated by the Federal Energy Regulatory Commission as part of the permit process.
Problem is... many of local decision makers claim they weren’t invited and point out a meeting should have taken place before the community meeting.
“If you all were really sincere about this discussion about the route it should have been done with officials from the city and county, the first responders should have been involved,” points out Johnson.
“We would have liked to be brought in earlier. I think that is pretty clear. When statements are made about explosions not being able to happen, that is just not reality. We know in my business that we prepare for the worst case scenario,” says [Fire Chief Charles Middleton].
[Red, yellow & bold emphasis added.]
Sempra's Cameron LNG terminal applies for re-export — Reuters
Cameron follows 2 other U.S. terminals with re-export
Cameron follows the lead of the Sabine Pass terminal in Louisiana and the Freeport terminal in Texas, which both received approval to re-export foreign-sourced LNG last year.
European gas prices are currently about $2.70 per million British thermal units above U.S. gas prices, with spot LNG prices in Asia nearly $5 higher. [Red, yellow & bold emphasis added.]
Citigroup exports LNG cargo from Freeport terminal to Asia — Bloomberg
Citigroup Inc. has loaded a previously imported liquefied-natural-gas cargo at the Freeport LNG terminal in Texas for export to Asia, according to a shipping tracking firm.
JPMorgan on June 21 exported a cargo of LNG to South Korea from Cheniere Energy Inc.’s Sabine Pass terminal in Louisiana, according to the Energy Department.
Citigroup shipped another cargo to Spain in February from Sabine Pass, department data showed. In December 2009 it brought a cargo to South Korea from Freeport.
The cargo exported on Sept. 3 was brought in to Freeport last month from Peru, according to vessel tracking data compiled by Bloomberg. The terminal received another cargo on Sept. 6 and is scheduled to receive a third on Sept. 10, the data showed.
First Nations get millions for pipeline training — Terrace Standard, Terrace, BC
A PLANNED … natural gas export project has become the focal point to provide hundreds of aboriginal people with marketable job skills and, for some, employment during construction and on operations afterward.
If the training program cannot meet its 600 client target within the 15 First Nations, it will then broaden its search, Collins said.
Both the pipeline and the LNG terminal have received provincial and federal environmental clearance. An initial plan to start construction work next year has been delayed because Apache and EOG only bought into the projects this year. No firm start date has been released.
Dubai to receive first LNG vessel this year (Sep 9) — (Bloomberg) Kahleej Times, Dubai, United Arab Emirates
DUBAI — As Dubai plans to receive its first cargo of liquefied natural gas later this year, a ship converted to store the fuel arrived at an export terminal in Qatar, the world’s largest supplier
of LNG.
The 33 year-old Golar Freeze, which can hold 125,000 cubic meters of liquefied natural gas, is equipped to store and regasify Qatari LNG as part of a $450 million, 10-year contract that the Dubai Supply Authority awarded to Golar LNG in 2008. [Red emphasis added.]
- LNG ships can be used to store LNG efficiently, and along with offshore terminals can offer greater market flexibility than shoreside facilities with storage tanks. Northeast Gateway and Neptune LNG offshore from Gloucester, Massachusetts; and Gulf Gateway offshore from Louisiana, are this type of LNG terminal.
- In the 2006 March 14 Golar Freeze LNG carrier incident at Elba Island, Georgia, a federal river pilot aboard a freighter transited past the Golar Freeze at full speed, in violation of Coast Guard requirements.
The river pilot had radioed four security alerts announcing his presence, but because the docking pilot aboard the Golar Freeze was asleep instead of monitoring river traffic, as he was supposed to be doing, the alerts went unnoticed.
The passing freighter's wake created a surge along the LNG jetty, forcing the Golar Freeze from the jetty, parting several of its mooring lines, and causing an emergency disconnect of the LNG offloading arms.
Two seasoned, licensed pilots — one on the Golar Freeze and one on the passing freighter — made simultaneous errors that resulted in the LNG incident.
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Coast Guard denies Weaver's Cove LNG appeal — TradingMarkets.com
U.S. Senators Jack Reed (D-RI) and Sheldon Whitehouse (D-RI) and U.S. Representatives Patrick Kennedy (D-RI) and Jim Langevin (D-RI), who have been working to block the siting of LNG marine terminals in urban communities that would require LNG tankers to pass by eleven Rhode Island towns and cities and more than 25 miles of densely populated coastline, applauded the Coast Guard's decision.
"The Coast Guard's letter is another reminder that Mount Hope Bay and the Taunton River are not appropriate places for an LNG terminal and associated vessel traffic," said U.S. Senator Jack Reed. "From a safety, economic, and environmental standpoint, it is clear that Weaver's Cove LNG proposal would place a burden on the Coast Guard, local law enforcement, taxpayers, and the resources of Mount Hope and Narragansett Bays. I will continue working with colleagues from Rhode Island and Massachusetts to oppose this project." [Red emphasis added.]
Coast Guard rejects a proposed Weaver’s Cove shipping route — Providence Business News, Providence, RI
Still under appeal is a separate proposal for an offshore station in Mount Hope Bay, allowing tankers to avoid traveling under the three bridges that connect Fall River and Somerset, said The Herald News.
USCG affirms decision on LNG vessel route for Weaver's Cove project — LNG Law Blog
Weaver’s Cove submitted a report to FERC in which the U.S. Coast Guard analyzed the potential effects of LNG vessel traffic servicing the Weaver's Cove facility on nearby recreational boating. The report is available in the FERC eLibrary under Docket No. CP04-36.
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Coast Guard denies appeal for LNG terminal in Fall River — The Providence Journal, Providence, RI
The denial issued Sept. 1 by Rear Adm. Brian M. Salerno, the deputy commandant for operations, upholds a 2007 ruling that found that portions of the waterway leading to the proposed offloading facility in the north end of the city were unsuitable for LNG tanker traffic. The decision raised questions about the ability of tankers to navigate safely through the old and new Brightman Street bridges, which are only 1,100 feet apart.
Although Weaver’s Cove moved on to a second plan — for a floating terminal in the middle of Mount Hope Bay — the appeal of the earlier decision was still pending.
“I consider this matter closed for the Coast Guard,” [deputy commandant for operations Rear Adm. Brian M. Salerno, Salerno] wrote.
Cameron LNG requests export authorization (Sep 3) — SNL
Cameron LNG LLC asked FERC on Sept. 3 for authorization to re-export foreign LNG in short-term arrangements of up to a cumulative total of 250 Bcf from its existing import terminal in Cameron Parish, La.
The LNG operator noted that the additional capability would help it weather the environment of low gas prices and large gas supply, which has greatly reduced the need for LNG imports and which some analysts expect to last at least 10 years.
The company was careful to note that it was not requesting the capability of exporting domestically produced gas. "Cameron's LNG export proposal would apply only to foreign-sourced LNG that has been imported and stored at the terminal," it said. "It would therefore not affect the availability of domestic gas supplies."
Cameron LNG is a wholly owned subsidiary of Sempra Global, which is owned by Sempra Energy. On Sept. 2, a Cameron affiliate and customer of the terminal, Sempra LNG Marketing LLC, filed an application with the U.S. Department of Energy for a blanket export authorization. SLNG Marketing said it wants to export for a two-year period up to a cumulative total of 250 Bcf of LNG that has been imported into the U.S. SLNG Marketing asked Cameron LNG to obtain export authorization from FERC, and Cameron LNG said other potential customers have expressed interest in exporting LNG. These other customers would also have to file for export authorization from the Department of Energy before using the terminal in this way. [Red, yellow & bold emphasis added.]
Emails, letters reveal LNG ties — The Gleaner, Kingston, Jamaica, West Indies
An economic relationship between Stephen Wedderburn — the technical director for the Government's effort to develop a liquefied natural gas (LNG) facility in Jamaica — and the Belgian firm designated the preferred bidder on the project will likely be a major focus of Contractor General Greg Christie's ongoing probe of the scheme, a series of emails and letters on the project obtained by The Gleaner suggest.
Shale gas, more prosperity for Northern BC (Sep 8) — Tumbler Ridge News, Tumbler Ridge, BC
When you consider that China is currently constructing the equivalent of two, 500 megawatt, coal-fired plants per week, the drive to get our natural gas to Asian markets should be a priority for ALL us.
That requires cooperation in advancing natural gas production AND in promoting the Liquefied Natural Gas (LNG) supply chain.…
LNG firm protests conditions for pipeline approval — The Daily Astorian, Astoria, OR [Subscription required]
Oregon Pipeline disagreed with several of the conditions imposed in Livingston's approval decision. The company had submitted a consolidated application for multiple land-use approvals for the construction of 41 miles of pipeline serving its proposed Skipanon Peninsula liquefied natural gas terminal in Warrenton.
The Board of Commissioners meeting begins at 6 p.m. Sept. 22 at the Judge Guy Boyington Building, 857 Commercial St., Astoria.
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New LNG projects screech to a halt
More US LNG projects scrapped as economics become less favorable (Sep 3) — Platts
One by one, developers of US LNG import terminals pulled the plug this
summer as overabundant domestic natural gas production turned what had been a
challenging outlook for imported gas into an all but impossible business
model.
The string of scrapped proposals started in May, when Bradwood Landing in
Oregon fizzled out with the bankruptcy of owners NorthernStar Natural Gas.
Next came the Atlantic Sea Island Group, whose developers told the US Coast
Guard in June they were suspending plans to build a terminal offshore New York
and New Jersey.
In July, the main investor behind Calais LNG in Maine jumped ship,
leaving its project manager scrambling to find a new financial backer. And in
August, the fully permitted Maple LNG proposal in Nova Scotia admitted defeat
to market forces.
Of the dozen other proposals already approved by US Federal Energy
Regulatory Commission and another three applications awaiting consideration, how many new terminals will get built? The answer, according to David Ledesma
an analyst with UK-based South-Court, is none.
"The logic says that there won't be any more," he said. "There is no need
for more capacity. It's a very simple number to do."
The rush to build LNG terminals -- which preceded the large-scale
development of shale gas in the US -- created import capacity of just over 14
Bcf/d -- about seven times the amount of LNG that tankers actually carried to
the US in the past two years, said Biliana Pehlivanova, a commodities analyst
who specializes in LNG for Barclays Capital.
"From a [US] market perspective we are quite well supplied, really for
the foreseeable future," she said. "Between the potential for growth of shale
gas in the US and also potential for growth of Canadian shale gas, the
prospect for the US needing to import significant amounts of LNG to the order
of magnitude that we already have capacity for are quite far out into the
future."
Pehlivanova said the US might need to increase LNG imports a bit in the
next four or five years. "But we're still well away from utilizing all of the
existing capacity," she said.
"I've been reading all the market analysis that comes my way," said Mike
Carrier, a top energy adviser to Governor Ted Kulongoski. "As long as our
economy is as soft as it is, as long as the demand for natural gas is low and
the price stays as low as it is and as long as the domestic supply of shale
gas appears to be as robust as it is, I agree with what the governor said
recently, that it's difficult to see a business case for an LNG import
facility."
"It looks like everything is converging to go
against the idea of building new LNG plants." [Red, yellow & bold emphasis added.]
LNG hopes evaporate (Sep 5) — Petroleum News
One of 10 proposed Canadian import terminals is working; one to be export project
Ten green bottles hanging on the wall …” goes the old song for children. Let’s make that “ten LNG projects” that once dangled the prospect of LNG imports to Canada for regasification into billions of cubic feet of gas for sale to North American customers by about 2015.
Not anymore. One is up and running and one has been converted to an LNG export venture.
The rest have either fallen off the wall, or, in the industry jargon, entered a “calm period.”
[C]onventional gas production is declining and market demand is rising, the emergence of shale gas has changed the equation, forcing most LNG proponents to either stop, or reduce work. [Red, yellow & bold emphasis added.]
- Anadarko's Bear Head LNG project;
- Newfoundland LNG;
- Quebec-based Energie Grande-Anse;
- Enbridge, Gaz Metro and Gaz de France's Rabaska LNG in Quebec;
- Petro-Canada (now Suncor Energy) and TransCanada's Gros Cacouna LNG;
- WestPac LNG near Prince Rupert on the British Columbia coast and gas-fired power generation plant on Texada Island; and
- Merrill Lynch Commodities' Teekay Corp. at Kitimat, British Columbia.
Coast Guard deals setback to LNG terminal (Sep 3) — WCVB-TV, Boston, MA
In a recent letter to Weaver's Cove CEO Gordon Shearer, Coast Guard Deputy Commandant for Operations Brian Salerno, wrote that the waterway "is unsuitable for the type, size, and frequency of LNG marine traffic associated with Weaver's Cove's proposal."
A spokesman for the company said the latest action by the Coast Guard won't prevent them from trying to move ahead with the project. [Red emphasis added.]
FERC Chairman responds to Louisiana Lt. Governor on Sabine Pass LNG export proposal (Sep 3) — LNG Law Blog
Last month FERC Chairman Jon Wellinghoff responded to a letter from Louisiana Lieutenant Governor Scott Angelle (D) regarding Sabine Pass LNG's proposal to export U.S. domestic natural gas via its LNG facility. In his response, Chairman Wellinghoff described the timing and benefits of its pre-filing process.
LNG pipeline issue moves to county (Sep 3) — Daily Astorian, Astoria, OR [Subscription required]
This week, project opponents including Columbia Riverkeeper, Columbia River Business Alliance and seven other groups and individuals came together and filed a single appeal of the Aug. 23 ruling from Hearings Officer Peter Livingston that granted conditional approval to the land-use application from Oregon Pipeline LLC.
Suit charges state with delaying gas pipeline (Sep 3) — Mail Tribune, Medford, OR
A company hoping to build a liquefied natural gas pipeline from Coos Bay through the upper Rogue River watershed to Malin has sued the state of Oregon, charging it with wrongfully delaying the project.
The catch is that the Federal Energy Regulatory Commission, the federal body that regulates construction of natural gas pipeline projects, cannot grant the firm the power of eminent domain over resistant property owners until the state authorizes the permits, according to the complaint.
"All over Southern Oregon, Pacific Connector has been pressuring people to give up some of their private property rights," she added. "They don't seem to be getting the message: People in Oregon value our land and don't support the excessive eminent domain power that the pipeline is trying to wield."
Out of several proposed natural gas pipelines in Oregon, only one moves forward — The Oregonian, Portland, OR
Before the recession, upbeat developers proposed no fewer than seven new long-haul natural gas pipelines in Oregon.
As of last week, however, only one project was definitively moving forward. Several others have disappeared entirely. And the remainder are in regulatory and financial limbo.
That same gas hub in Malin is the terminus point of a second proposed pipeline -- this one a 230-miler connecting a proposed LNG terminal in Coos Bay.
The upheaval is partly a function of a gas market that has turned upside down during the past three years. Gas prices and demand have shriveled. And domestic reserves are burgeoning as drillers access supplies trapped in shale formations.
Given the massive new quantities of gas coming to Malin from Ruby, many observers say the Coos Bay terminal has lost its viability. But project backers continue to push for state permits.
[A] final LNG terminal and pipeline, called Oregon LNG, still needs virtually all its federal and state licenses. [Bold red emphasis added.]
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Congress of Councils to address LNG threat next week [Opinion column] — The Jamestown Press, Jamestown, RI
On Sept. 8, Jamestown and its Town Council will host town councils from communities on both sides of the Bay to address the Hess/LNG issue.
Hess would like to take over our Bay, at our expense. If you think government spending is out of control now, wait until you get the bill for the increased police, EMS and security costs involved with the transit of LNG in the Bay.
The Congress of Councils will be unique. It will be the towns taking a stand in their own defense. They will work with the many great private organizations that have done good work on this issue to date. But they won’t depend on the kindness of others to protect your rights and your wellbeing. They will attend so cities and towns can take a stand as one community. Something our country was founded on.
Say no to fracking [Opinion column] — The Gazette, Montreal, QC
The technique has caught on. Like wildfire. Because of its success, new wells have sprung up all over Texas, Utah, Pennsylvania and elsewhere. Natural gas prices have fallen. The LNG re-gasification plant for Quebec has been put on indefinite hold. The New Brunswick plant stands somewhat underused. A new plant in Texas, near Houston, has only received a few contracted loads of LNG. Interest in "fracking" (hydraulic fracturing) is spreading rapidly worldwide to the consternation of Qatar, the United Arab Emirates and Russia.
It has long been known that northeast North America has large shale formations with methane trapped in their tight pores. In New York state and Pennsylvania it is called the Marcellus Shale. In Quebec there are two formations of interest. One is called Utica and a smaller one, Lorraine. These are large areas extending (very roughly) from inside New York state to Quebec City. Lorraine lies over the Utica formation. Parts of both lie under the St. Lawrence.
Indeed, the gas will mostly be destined to the U.S. northeast, which is currently saturated in cheap natural gas flowing from the west, new wells in Pennsylvania as well as natural gas from Nova Scotia. Why play to a cheap market? The U.S. Energy Information Administration estimates that natural gas demand will increase by at least 0.5 per cent per year for the next 20 years. We might as well wait for the higher prices and royalties. [Red & bold emphasis added.]
LNG pipeline firm sues Ore. over delays — (AP) KDRV-TV, Medford, OR
COOS BAY, Ore. -- A natural gas pipeline company developing a project in Coos Bay has filed a federal lawsuit against the state, claiming officials are wrongfully delaying the project.
The Department of State Lands is requiring pipeline developers to gather more than 200 signatures from landowners whose property may be affected before it grants a permit.
US shale plays expected to boost NGL supplies, favor petchems — Platts
Expanding supplies of natural gas liquids [NGL] derived from unconventional
sources, such as the Eagle Ford and Marcellus shales and Bakken formation, is
expected to benefit the cost structure of the North American petrochemical
market, industry observers said in a webinar Thursday.
Lippe said such favorable cracking economics will give US ethylene
producers competitive advantages compared to European and Asian producers,
adding that the wide differentials between crude oil and cheaper North
American natural gas prices also creates an encouraging economic environment
for midstream and petrochemical producers. [Red emphasis added.]
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Another big idea falls through (Aug 30) — Cape Breton Post, Sydney, NS
[Keltic Petrochemical's] was also not the first proposal for a petrochemical industry in the region though nothing else had gotten that far along. Now, with the end of the Goldboro [LNG] hopes and the recent decision not to further develop the Sable gasfield, the notion of an energy-based economy for the region – which at one time also included ambitions for offshore exploration and development support from Strait area ports – has pretty well evaporated.
What the king of natural gas forecasting says about future prices (Aug 31) — Seeking Alpha
In the US, the reason for the lower price forecast is simple: natural gas producers are still drilling, despite low prices.
In Canada, King’s reasoning for even lower prices than the US include one that I have been speaking about for months:
Takes of marine mammals incidental to specified activities; taking marine mammals incidental to operations of a [liquified natural gas terminal] — TradingMarkets.com
SUMMARY: In accordance with the regulations implementing the Marine Mammal Protection Act (MMPA) as amended, notification is hereby given that NMFS has issued an Incidental Harassment Authorization (IHA) to the Northeast Gateway Energy BridgeTM LP (Northeast Gateway or NEG) and its partner, Algonquin Gas Transmission, LLC (Algonquin), to incidentally harass, by Level B harassment only, small numbers of marine mammals during operation of an offshore liquefied natural gas (LNG) facility in the Massachusetts Bay for a period of 1 year.
DATES: This authorization is effective from August 31, 2010, until August 30, 2011.
Anti-LNG port group set meeting — The Providence Journal, Providence, RI
A community advocacy group calling itself the Congress of Councils will hold a meeting next week to discuss how Rhode Island communities can work together to oppose a proposed floating liquefied natural-gas terminal in Mount Hope Bay.
Confirmed speakers include Attorney General Patrick C. Lynch, Save The Bay executive director Jonathan Stone, and Evan Smith, executive director of the Newport and Bristol County Convention and Visitors’ Bureau, according to a news release from the Congress of Councils. Political candidates running for statewide and federal offices along with members of the General Assembly representing Bay areas are also invited.
Rhode Island Congressional delegation raise concerns with Weaver's Cove LNG project (Aug 31) — LNG Law Blog
Earlier this month members of Rhode Island's congressional delegation wrote to FERC Chairman Jon Wellinghoff expressing their concern with the planned Weaver's Cove LNG import project. In their letter, available in the FERC eLibrary under Docket No. CP04-36, the Members of Congress also invited Chairman Wellinghoff and the other FERC commissioners to meet with the delegation and to tour the site proposed for the Weaver's Cove LNG project.
Gubernatorial candidates put forth plans in Newport — Middletown Patch, RI
On environmental/energy issues the candidates were more often in agreement than not. No one favored the Hess LNG proposal.
[Red emphasis added.]
FERC pre-filing process not applicable to Cameron LNG re-export proposal (Aug 31) — LNG Law Blog
Yesterday FERC notified Cameron LNG, LLC that the Commission's pre-filing procedures and review process are not applicable to the company's proposal to modify its facility to allow re-exports of foreign-sourced LNG.
Companies seek unconditional OK for LNG terminal (Aug 30) — Anchorage Daily News, Anchorage, AK
The companies that own the liquefied natural gas terminal at Nikiski want the federal government to extend their export license by two years, without any conditions on that extension.
A group of Democratic lawmakers, several citizens and Gov. Sean Parnell, who filed late comments, asked the Energy Department to guarantee local needs are met before exports continue.
Gas pipeline developers sue Oregon land officials (Aug 31) — Portland Business Journal, Portland, OR
The developer of a proposed 234-mile natural gas pipeline has filed a federal lawsuit against two Oregon land officials the developer claims are improperly using state law to delay the project.
The lawsuit, filed Friday in U.S. District Court, pits Pacific Connector against Louise Solliday, director of the Oregon Department of State Lands, and Richard Whitman, director of the Oregon Department of Land Conservation and Development.
In the lawsuit, Pacific Connector says regulation of pipeline projects is strictly the domain of the Federal Energy Regulatory Commission.
But before granting a permit for construction, the Department of State Lands is requiring the pipeline developers to obtain signatures from about 220 landowners whose property may be affected.
Without that permit, the state Department of Land Conservation and Development will not review whether the project is consistent with the federal Coastal Zone Management Act — a requirement to getting certification from federal regulators, according to the lawsuit.
How the U.S. natural gas ETF (UNG) lost 23% in August — ETF Daily News, Manchester, NH
Even if demand for natural gas surges–and some of the legislation making its way through Washington makes that seem likely–it will have a hard time keeping up with a rapidly-expanding global supply of the fuel. The last month has seen several massive discoveries of natural gas, including previously uncovered fields in Israel and Australia.
The discovery of natural gas in regions not known as traditional energy hot spots has convinced investors that supplies will be ample for the foreseeable future, adding further downward pressure to prices [see UNG's Insurmountable Obstacle].
Beaten-up natural gas enters September on shaky footing (Aug 31) — MarketWatch
SAN FRANCISCO (MarketWatch) -- Natural-gas futures, wrapping up their worst month in more than two years, are entering the historically weak month of September dogged by confusion over production.
Prices stumbled 23% loss in August, their largest monthly decline since July 2008. That tops oil's 9% drop for the month. Read more in Futures Movers.
Extreme quantities of natural gas avails may produce unintended consequences — Gerson Lehrman Group
Gas directed rig count is holding up because producers need to drill recently acquired leases, not because gas is needed.
In fact, an excellent case can be made for low gas prices all the way through 2015 and then not rising much after that.
'Supply dragon' keeps natural gas in the doldrums — Edmonton Journal, Edmonton, AB
"… If anything, the latest U.S. natural gas supply data are showing signs of accelerating thanks to a gas rig count which has refused to die," he says. [Red, yellow & bold emphasis added.]
US opens the door on shale bed gas development (Aug 31) — Metal Miner
The US has certainly put the cat among the pigeons of the natural gas world!
In the US, an API report advised that thanks to the arrival of shale gas since the middle of the last decade the United States has a future supply of natural gas of over 2,000 Tcf. At current consumption rates, this is enough natural gas to supply the nation for the next hundred years. This is an increase of more than 35% in just the last 5 years and it is rising every year as new resources are qualified. [Red, yellow & bold emphasis added.]
Liquefied natural gas facilities: Obtaining approval of alternative vapor-gas dispersion models (Aug 31) — TradingMarkets.com
SUMMARY: This advisory bulletin provides guidance on the requirements for obtaining approval of alternative vapor-gas dispersion models under Subpart B of 49 CFR part 193.
The Pipeline and Hazardous Materials Safety Administration (PHMSA) issues federal safety standards for siting liquefied natural gas (LNG) facilities. Those standards require that an operator or governmental authority control the activities around an LNG facility to protect the public from the adverse effects of thermal radiation and flammable vapor-gas dispersion. Certain mathematical models and other parameters must be used to calculate the dimensions of these so-called "exclusion zones."
After carefully considering the information provided in the Original FRPF Report, Supplemental FPRF Report, and NASFM MEP Report, PHMSA is issuing further guidance on the standard for obtaining approval of alternative vapor- gas dispersion models, particularly the requirement for validation by experimental test data. That guidance is based on the MEP's three-stage process for evaluating such models, but includes modifications to address the concerns of other stakeholders, including NASFM and FERC.
Dearth of LNG carriers to keep spot rates high in 2010 — Lloyd's List [Paid subscription required]
SPOT charter rates for liquefied natural gas carriers are set to continue increasing for the rest of this year due to a growing shortage of LNG carriers and rising demand for spot gas cargoes, says a leading shipowner and shipbroker.According to Golar LNG Energy chief executive Oscar...
This news indicates an increased price in LNG transportation, adding to the cost of importing LNG.
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