Passamaquoddy Bay
Opposition group files response to Downeast LNG comments (May 30) — LNG Law Blog
Save Passamaquoddy Bay filed responses [on May 25] with FERC to Downeast LNG's [April 24] comments, rebutting Downeast's claims regarding the lack of natural gas supply options in New England and the need for Downeast's proposed LNG import terminal.
There is no need for Downeast LNG's proposed LNG from overseas suppliers; decades' worth of domestic natural gas is available in nearby Pennsylvania.
Southeast
Kinder Morgan completes purchase of El Paso Corp. (May 30) — Savannah Morning News, Savannah, GA
The purchase includes the LNG terminal at Elba Island, and company officials say the merger will have no impact on its operations. It will continue to be known as Southern LNG, and management and staff will remain the same.
Gulf of Mexico
Sabine Pass files answer to Sierra Club’s motion for stay (May 30) — LNG Law Blog
Sabine Pass Liquefaction filed a response to Sierra Club's motion for stay of FERC's order approving the Sabine Pass LNG export terminal in Cameron Parish, La. Sabine Pass argues that Sierra Club failed to establish that it will suffer irreparable harm if a stay is not granted and that granting a stay will cause Sabine Pass and the communities of Southwestern Louisiana substantial harm.
Port Freeport accepts Freeport LNG's bid on land for liquefaction [Press release] (May 30) — Freeport LNG
During a special meeting, Port Commissioners accepted Freeport LNG’s bid for a long-term lease of a 170-acre tract of land on Quintana Island adjacent to Freeport LNG’s existing LNG regasification facility and authorized Port Freeport’s chairman Bill Terry to execute the lease proposed in Freeport LNG’s bid. This lease helps pave the way for Freeport LNG to construct its previously announced natural gas liquefaction project, a multi-billion dollar capital investment that will bring several thousand construction jobs to the area during the construction period as well as approximately 180 new full-time jobs. Once Freeport LNG secures government approval and funding for construction, it will solidify this agreement for a thirty-year term which can be extended for five additional ten-year periods.
Caribbean
Jamaica should demand fair trade with Trinidad - Samuda — Go-Jamaica, Kingston, Jamaica, West Indies
Former industry minister, Karl Samuda, has declared that Jamaica should make it clear to Trinidad and Tobago that Jamaica will not continue to accept its goods with nothing in return. He said Jamaica has not been benefiting from its membership in CARICOM and suggested that the country leave the bloc of Caribbean member states.
Samuda pointed to an article in a Barbados newspaper which stated that the twin-island republic has entered into an arrangement to supply Barbados with the liquefied natural gas (LNG).
Jamaica and Trinidad and Tobago signed a memorandum of understanding in November 2004 for the supply of 1.1 million tonnes of LNG per annum over a 20-year period. However, the arrangements never materialised as Trinidad said it did not have enough to supply.
BPTT: Trinidad and Tobago may be short on gas until 2014 — Oil & Gas Journal
Trinidad and Tobago could continue suffering a shortage in its natural gas production until 2014 as the country’s largest supplier, BP Trinidad & Tobago, said it will not be able to return to its highest production levels until most of its infrastructure upgrade is complete towards the end of 2013-14.
British Columbia
BC Hydro forecasts enough energy for needs of two LNG facilities (May 30) — The Globe and Mail, Toronto, ON
BC Hydro has included the energy needs of two new liquefied natural gas facilities in forecasts of future demand in a new draft report.
However, the draft integrated resource plan 2012 notes that BC Hydro could have to provide “significant” additional energy because other LNG proposals are in the wings.
Booming natural-gas sector ignites debate over BC Hydro service (May 20) — The Globe and Mail, Toronto, ON
While B.C. is aggressively pushing new industrial development, including the energy-intensive production of liquefied natural gas, a turf war has begun about who gets to share the finite supply of the province’s relatively cheap hydro-electric power.
[A] debate about how to serve the province’s burgeoning shale-gas development, carried out mostly within the confines of a regulatory hearing on a transmission line proposal, demonstrates that BC Hydro’s customers are worried.
The upside of foreign ownership — Financial Post, Don Mills, ON
Canadian projects will absorb 10% to 15% or more of the company’s global budget in coming years, and that doesn’t include acquisitions, which shouldn’t be ruled out. As a result of its LNG plans and a strategic partnership with PetroChina, the acquisitive Shell is motivated to bolster reserves in Western Canada it can export to Asia for higher prices. It’s a big bet on the maple leaf by a European company. Energy development in Canada has never been so controversial, labour is scarce, costs are high, First Nations are unco-operative, the regulatory system is in flux — all of which translates into lots of uncertainty.
United States
Shale of the century (Jun 2 edition) — The Economist
AMERICA’S “unconventional” gas boom continues to amaze. ... America produces more gas than it knows what to do with. Its storage facilities are rapidly filling, and its gas price (prices for gas, unlike oil, are set regionally) has collapsed. Last month it dipped below $2 per million British thermal units (mBtu): less than a sixth of the pre-boom price and too low for producers to break even.
This is astonishing. Barely five years ago America was expected to be a big gas importer. Between 2000 and 2010 it built infrastructure to regasify over 100 billion cubic metres (bcm) of imported liquefied natural gas (LNG). Yet in 2011 American LNG imports were less than 20 bcm. Efforts are now under way to convert idle regasification terminals into liquefaction facilities, in order to export LNG. Plans for a terminal in Sabine Pass, Louisiana, are expected to be approved in June. [Red & bold emphasis added.]
U.S. natural gas export permits delayed until late summer — Bloomberg Businessweek
Since Cheniere Energy Inc. (LNG) (LNG) received a department permit to ship gas from Louisiana last year, the agency suspended other applications and commissioned a study of the impact of exports on domestic energy consumption, production and prices.
“The second part of the study, which will assess the broader economic effects of increased natural gas exports, is ongoing,” William Gibbons, an Energy Department spokesman, said in an e-mail yesterday. “We expect to be able to release the comprehensive study results late this summer.” [Red & bold emphasis added.]
North America
Don't expect North American prices for LNG exports: Shell chief (May 30) — The Globe and Mail, Toronto, ON
North American gas is four to six times cheaper than gas on international markets, where it’s priced off high oil prices. The huge price gap has led to a raft of proposals to build new facilities to load U.S. and Canadian gas onto ships for Asia and elsewhere. In Canada, a half-dozen, including one led by Shell, are being planned for the northern B.C. coast.
Investors, however, have grown increasingly concerned that buyers such as China will refuse to accept an oil-linked price and instead demand pricing on North American terms. If that happens, LNG exports suddenly become a much more tenuous proposition. [Red & bold emphasis added.]
Cheniere is already making bargain-basement deals to price LNG exports on Henry Hub prices, plus a 15% premium. (See the 2011 Nov 21 Reuters article, UPDATE 2-Cheniere signs second U.S. LNG export deal.).
Cheniere would export LNG at fire-sale prices, depleting US natural gas supplies, resulting in higher US natural gas prices, and bringing little positive impact on the US trade deficit.
New England
Markey: Yemen natural gas ties to New England should be eliminated (May 8) — Congressman Ed Markey
“These natural gas supply problems highlight the importance of developing the domestic infrastructure that would allow all Americans to benefit from the low-price, abundant and secure supplies of natural gas now being produced in the United States,” writes Rep. Markey to Energy Secretary Steven Chu. “The disturbing connection between American energy demands and violence in the Middle East is one that we must work to eliminate. I believe that using our domestically produced natural gas here in America to reduce our dependence on foreign supplies should take precedence over any plans to export our natural gas.” [Red, yellow & bold emphasis added.]
Pipelines — not LNG import terminals, such as being proposed by Downeast LNG — are the solution to natural gas access in New England.
Letter from Congressman Markey promoting natural gas pipeline expansion in New England (May 8) — Congress of the United States
These natural gas supply problems highlight the importance of developing the domestic infrastructure that would allow all Americans to benefit from the low-price, abundant and secure supplies of natural gas now being produced in the United States. The disturbing connection between American energy demands and violence in the Middle East is one that we must work to eliminate. I believe that using our domestically produced natural gas here in America to reduce our dependence on foreign supplies should take precedence over any plans to export our natural gas. Currently, nine applications have been filed with your Department to export more than 20 percent of current domestic natural gas consumption. And more applications could come in to the Department in addition to these initial applications. [Red & bold emphasis added.]
Gulf of Mexico
Cheniere’s Sabine Pass LNG re-export license expires on May 31 (May 29) — Bloomberg
An application to renew the two-year license was filed on March 30, data show. The licensing process usually takes about 90 days from receipt of application, John Anderson, a Washington-based official at the department, said by telephone today.
Caribbean
T&T’s LNG back on the front burner — Jamaica Observer, Kingston, Jamaica, West Indies
[T]he world LNG situation has changed dramatically, with a universal oversupply of the gas resulting in significant reductions in its price as LNG suppliers struggle to remain competitive. Trinidad, now with four production trains to maintain, has the additional concern of locating new gas fields to remedy the last reported shortfall in gas reserves to 10.5 years. The latest explorer to join the search for new gas fields is British Petroleum (BP), which already has production facilities in T&T.
Alaska
Senator Murkowski promotes Alaskan LNG supplies to Japan, Korea (May 25) — LNG World News
Murkowski, the ranking Republican on the Senate Energy and Natural Resources Committee, has seized every chance to promote the idea of exporting some of Alaska’s 35 trillion cubic feet of natural gas to Asian markets. Earlier this month, she raised the issue with Japan’s Prime Minister Yoshihiko Noda and, separately, with members of Japan’s Parliament.
British Columbia
Canada must act fast or miss LNG window: Shell CEO — (Reuters) Financial Post, Don Mills, ON
CALGARY – Canada only has until the end of this decade to build up its liquefied natural gas industry or face being overtaken by other countries looking to cash in on booming demand for the fuel throughout Asia, Royal Dutch Shell Plc’s chief executive said on Tuesday.
Canada’s LNG export window closes “this decade” (May 29) — Calgary Herald, Calgary, AB
The Canadian division of Shell, among the largest LNG suppliers in the world, has a 40 per cent working interest in a proposed two billion cubic feet per day facility to start up this decade near Kitimat, B.C. with Asian partners Korea Gas Corp., Mitsubishi Corp. and PetroChina Co. Ltd., the biggest among six LNG projects currently proposed for sites near the remote community.
Shell launches LNG plans (Week of May 27) — Petroleum News, Anchorage, AK
Royal Dutch Shell is leading three Asian firms in rolling out plans for by far the largest of the projects to export LNG from British Columbia.
The newly titled LNG Canada venture, carrying an estimated cost of C$12.3 billion, is tentatively scheduled for startup late this decade, with initial capacity of 12 million metric tons a year of capacity.
That target easily outstrips the Apache-operated Kitimat LNG project at 5 million metric tons a year and the BC LNG Export Cooperative at 1.8 million metric tons a year — the only two proposals that currently have 20-year export permits from Canada’s National Energy Board.
Blame Canada — Earth Island Journal
About 90 percent of the gas produced in British Columbia is exported to US or sent to Alberta, where it is used to boil the tarry bitumen out of the millions of tons tar sands. A massive expansion of shale gas operations is underway due to the recent approval to build a liquefied natural gas plant (LNG) on BC's coast, at Kitimat. Korea Gas, Shell, Mitsubishi Corp and Petro-China are involved in the $12 billion project to compress [sic] and liquify 1.2 billion cubic feet per day and load it on LNG tankers for lucrative Asian markets. Another LNG terminal owned by US companies has received permits to begin construction in the same area.
Where's the power to run LNG plants? (May 28) — The Vancouver Sun, Vancouver, BC
What [Premier Christy Clark is] not saying, though, is how she'll come up with the huge amounts of electricity required to compress [sic; LNG is not compressed —SPB webmaster], cool, and liquefy the gas for these new LNG plants. Here's maybe why: BC Hydro simply doesn't have the capacity to provide even close to the amount of power required for these projects.
It also has no plan to build or buy the power that would be needed. The first three LNG proposals alone slated for 2020 would require about half of the electricity that's currently consumed by the entire province.
B.C.'s LNG exports a good news story (May 26) — The Vancouver Sun, Vancouver, BC
B.C. is blessed with vast reserves of natural gas. Conservative estimates put the amount of recoverable gas in B.C. at 100 trillion cubic feet. To put that in perspective, B.C. has produced a total of about 22.5 trillion cubic feet over the last six decades.
There are several proposals to establish liquefied natural gas plants in B.C. which, if all are built, would represent investment of more than $20 billion, create up to 9,000 construction jobs and 800 long-term operational jobs, and generate $1 billion a year or more in revenue for the government, assuming the econometric models are accurate.
BC Hydro to increase northwestern BC spending (May 24) — Terrace Standard, Tarrace, BC
While BC Hydro estimates it can supply power to the Kitimat LNG and BC LNG plants from existing sources, that won't be the case for the Canada LNG plant plan announced two weeks ago.
United States
AGA: Customers see benefits of gas abundance (USA) (May 25) — LNG World News
Low domestic natural gas prices have led to savings of almost $250 billion for natural gas customers over the past three years. The American Gas Association (AGA) released a study entitled “Identifying Key Economic Impacts of Recent Increases in U.S. Natural Gas Production” which credits the recent success of shale gas production in the United States for lower natural gas commodity prices which have translated into huge savings for residential and commercial customers.
Increasing LNG imports — as advocated by Downeast LNG — would cost Americans more than using plentiful domestic natural gas.
Ukrainian officials visit U.S. to secure LNG supplies (May 29) — LNG Law Blog
Platts LNG Daily [subscription required] reports that Ukrainian government officials will visit the United States this week to discuss obtaining U.S. LNG supplies in an effort to diversify their energy supply portfolio.
U.S., China to gain from natural gas glut if regulation right, says IEA (May 29) — Calgary Herald, Calgary, AB
The advent of North American LNG exports by 2020 will more than double U.S. gas prices from current historic lows but bring down prices in the world’s biggest LNG market, Japan, the IEA said. [Brown & bold emphasis added.]
LNG exporters sail by U.S. manufacturers (May 28) — Forbes
“The large‐scale export of natural gas via LNG will not only play havoc with the current supply/demand situation (and hence the price of natural gas) but also, because the price of LNG abroad is tied to the international oil market, will inevitably link the domestic price of natural gas to international oil markets,” says Bert Kalisch, chief executive of the American Public Gas Association.
Altogether, there are 11 LNG receiving facilities here and 9 of them are asking U.S. regulators if they can be converted to export terminals. Most of the applications are coming from the Gulf States, which have already been receptive to their LNG import facilities and which would likely support any changes to their operations. [Red & bold emphasis added.]
North America
Exxon considering natural gas exports (XOM, CHK, EOG, APA, ECA, LNG) — 24/7 Wall St.
At the company’s shareholders meeting today, the CEO of Exxon Mobil Corp. said that Exxon is studying the possibility of exporting natural gas from the US Gulf Coast and Canada. Natural gas production in the US has exploded as hydraulic fracturing (fracking) technology has boosted US reserves to the point where there is sufficient natural gas to meet US demand and to allow exports, according to Exxon CEO Rex Tillerson. [Red & bold emphasis added.]
ExxonMobil 'evaluating' LNG exports from US, Canada: CEO — Platts
[D]uring a post-meeting press conference, [company CEO Rex Tillerson] said the company's 2 Bcf/d Golden Pass import terminal near Beaumont, Texas, was likely one such [LNG export] option.
The company is also looking at western Canadian exports because it has stakes in the Horn River play there, he added. [Red & bold emphasis added.]
Golden Rules for a Golden Age of gas (May 29) — International Energy Agency (IEA)
Natural gas is poised to enter a golden age, but this future hinges critically on the successful development of the world’s vast unconventional gas resources. North American experience shows unconventional gas - notably shale gas - can be exploited economically. Many countries are lining up to emulate this success.
But some governments are hesitant, or even actively opposed. They are responding to public concerns that production might involve unacceptable environmental and social damage.
Maine
Natural gas seen as key fuel for area (May 22) — Kennebec Journal, Augusta, ME
[T]he state government is seeking to reach an agreement with a firm capable of providing natural gas to heat state buildings in the Augusta and Gardiner area and provide the fuel via a to-be-developed pipeline to other users in the Kennebec valley region. The state has asked for a request for proposals by June 1.
The state's request for proposals says that it "seeks to enter into a memorandum of agreement with an existing energy provider to supply natural gas to the Augusta/Gardiner area, with sufficient infrastructure development capacity to continue natural gas supply to the Kennebec valley region through Madison. The state is looking for the development of a pipeline to supply natural gas to those areas.
Dean Girdis would have us believe there is not enough gas available for the above project unless an unneeded Downeast LNG project is built.
New England
Suez LNG pulling out of city (May 24) — Gloucester Times, Gloucester, MA
[Neptune, owner of Suez LNG,] is a local subsidiary of the French multinational corporation GDF Suez. The company says it's consolidating its offices closer to Boston, near its main area operation in Everett.
Suez will continue running the terminal, only it will do so from Charlestown rather than in Gloucester. The terminal, Churchill has said, supplements the company's [Everett LNG import terminal] operation. In the two years since GDF Suez opened the Neptune terminal, the company received four shipments from LNG tankers.
While the terminal can process 400 million cubic feet of gas per day, shipments to it depend on the region's demand for natural gas, and recently that demand hasn't been high anywhere. National natural gas production from shale deposits has increased over the last few years — so much so that storage space for it is running out as the price of natural gas dropped. [Red & bold emphasis added.]
Suez LNG has received a mere four cargoes during its lifetime, demonstrating the lack of need for Downeast LNG — the sole remaining LNG import terminal proposal in all of North America.
Markey urges more investment in gas pipelines (May 9) — Boston Globe, Boston, MA
In a three-page letter to federal energy Secretary Steven Chu, Markey questioned whether the region should import liquefied natural gas from Yemen when domestic gas production is booming because of drilling in shale formations across the country, including in Pennsylvania.
“These natural gas supply problems highlight the importance of developing the domestic infrastructure that would allow all Americans to benefit from the low-price, abundant, and secure supplies of natural gas now being produced in the United States,’’ wrote Markey, a Malden Democrat and ranking member of the House Natural Resources Committee.
In an interview, Markey said he would “seriously consider’’ supporting a proposal by Spectra Energy Corp. of Houston to expand the Algonquin Gas Transmission pipeline that delivers natural gas to New England.
Spectra has said it wants to expand the capacity of the Algonquin pipeline in Southern New England by about 15 percent, and estimated the cheaper supplies from Northeast gas fields would help save gas and electric customers up to $651 million a year. Richard Kruse, a Spectra vice president, said Tuesday the company was prepared to move forward with the project, depending on market conditions. [Red, yellow & bold emphasis added.]
Dean Girdis wants us and FERC to believe that only Downeast LNG's surplus import terminal can supply more natural gas to New England; however, reality — and the natural gas pipeline industry — tells us otherwise.
Gulf of Mexico
Excelerate Energy plans natural gas export vessel for Gulf Coast (May 17) — Fuel Fix
Excelerate Energy announced Tuesday that it will develop the nation’s first floating liquefaction facility at Port Lavaca on the Texas Gulf Coast, to export U.S. natural gas.
Port Lavaca, about 120 miles southwest of Houston, provides access to the booming south Texas natural gas market and the Atlantic Basin through the Gulf of Mexico, the company noted.
Exporting natural gas from the United States has been a hotly debated issue as the nation has been saddled with a glut of the fossil fuel in recent years, causing its price to plummet. Natural gas has become a cheap energy for industries that use it for manufacturing and homeowners who use it for heating. But exporting it overseas, where natural gas commands higher prices, could generate jobs and revenue for the U.S. economy. [Red & bold emphasis added.]
USA: One LNG cargo re-exported in March (May 9) — LNG World News
The cargo was shipped from the Freeport LNG terminal on March 18 onboard the LNG Capricorn, a 126,300 cbm tanker.
There are currently three U.S. LNG terminals that have been granted Federal approval to re-export LNG: Freeport in Texas, Sabine Pass and Cameron in Louisiana.
Approve LNG facilities, trade authorizations [Editorial] (May 7) — Daily World, Opelousas, LA
Sempra Energy and state economic development officials announced that subsidiary Cameron LNG signed a deal with a French company, GDF Suez, to develop Cameron's Hackberry natural gas liquefaction plant. In three to four years, the terminal will provide Suez with 4 million tonnes of liquefied natural gas a year. That's the equivalent of about 550 million cubic feet per day.
Liquefied natural gas exports mean that the industry that employs one Acadiana worker in 10 will be more secure. They mean we'll rely less on energy imported from unstable, sometimes hostile nations. They mean the world will use cleaner energy in a safer way. [Brown & bold emphasis added.]
Exporting LNG will somehow make US less dependent on imported LNG? That's logic only the LNG industry could appreciate.
Bullish on future of US LNG exports, Asian firms sign $498 million investment deal (May 7) — gCaptain
HOUSTON – Cheniere Energy announced [May 7th] that Asian investment company Temasek,and private equity firm RRJ Capital, have agreed to make an investment of approximately $468 million in Cheniere. Proceeds from this deal will be used in connection with the financing of the Sabine Pass LNG liquefaction project. Additionally, Temasek, RRJ Capital and Cheniere are in discussions on a strategic partnership focused on developing LNG sales, marketing and trading relationships and opportunities in Asian markets.
The partnership would market LNG volumes from the proposed Sabine Pass and Corpus Christi LNG liquefaction facilities.
United States
Conoco CEO: Exporting LNG from lower-48 US states is reasonable (May 25) — NASDAQ
Conoco holds a stake in the Golden Pass LNG import terminal in Sabine Pass, La., along with Exxon Mobil Corp. and Qatargas, which was planned and built when a shortage of natural gas in North America was expected; but by the time it was finished, a natural gas boom rendered imports moot. "The partners are looking at what to do with that terminal," Lance said, adding that no decision had been made.
EIA: Horizontal drilling boosts gas production in Pennsylvania, USA (May 24) — LNG World News
Historically, natural gas exploration and development activity in Pennsylvania was relatively steady, with operators drilling a few thousand conventional (vertical) wells annually. Prior to 2009, these wells produced about 400 to 500 million cubic feet per day of natural gas. With the shift to and increase in horizontal wells, however, Pennsylvania’s natural gas production more than quadrupled since 2009, averaging nearly 3.5 billion cubic feet per day in 2011. Natural gas wells accounted for virtually all (99%) of the horizontal wells started over this period. [Red & bold emphasis added.]
Downeast LNG wants the public to believe that it is impossible for New England to receive natural gas from Pennsylvania, even though pipelines exist and pipelines in New England and the Northeast have a history of successful pipeline development and expansion.
An urgent update on America's energy megatrend — The Market Oracle
In just the past 10 years, America has gone from expecting to import natural gas to boasting the world's largest supplies. ... and producers are finding more and more of the stuff every day.
Based on government statistics, the U.S. is now sitting on a 90-plus year supply of natural gas. Industry professionals say it's even more... According to Steve Farris, the CEO of natural gas giant Apache, the U.S. has at least a 300-year supply of natural gas. [Red & bold emphasis added.]
LNG industry-wannabe Downeast LNG wants the world to ignore reality and import unneeded LNG from overseas.
Will LNG exports rescue the North American natural gas market? (May 21) — Energy Tribune, Houston, TX
It wasn’t that long ago – as recently as 2008 – that people were debating whether the U.S. could build enough liquefied natural gas (LNG) import infrastructure to fulfill the needs of an undersupplied natural gas market. Now, of course, the problem is the polar opposite: what to do with North America’s massive and persistent glut of natural gas. ... We are referring to the prospect of the U.S. and Canada becoming significant exporters of LNG....
One of the few projects in an advanced stage of development is Sabine Pass on the Louisiana-Texas border. Cheniere Energy has operated an LNG import terminal on this site since 2008, but since LNG imports are the last thing the U.S. needs these days, the company is working to transform the facility into a bi-directional hub, capable of importing as well as exporting LNG. The liquefaction component has been designed with maximum capacity of 2.8 Bcf/d, though the first phase, expected to start up in late 2015, would comprise only two trains rather than four. Final federal approval for the project was given in April. [Red & bold emphasis added.]
US shale boom, Europe glut alter energy landscape (May 17) — Kyiv Post, Kyiv, Ukraine
A boom in North American shale gas production in the past five years has resulted in sharp falls in domestic power and gas prices there and could turn North America from a gas importer into a large exporter, and a similar development is seen as underway in the oil sector.
"It fundamentally modifies the geopolitical landscape, and this is bullish US. They will have the cheapest power, gas, and oil and that could lead to an industrial revival as its industry becomes globally competitive again because of cheap energy." [Red & bold emphasis added.]
Hot markets: U.S. LNG terminals (May 14) — Engineering News-Record, New York, NY
The surge in shale-gas extraction around the U.S. has caused a worldwide rush to obtain cheap U.S. natural gas. Now, to answer this demand, major energy companies are scrambling to convert existing liquefied natural gas, or LNG, import terminals into export terminals. [Red & bold emphasis added.]
EIA: U.S. gas consumption to rise 5.1 percent in 2012 (May 9) — LNG World News
Liquefied natural gas (LNG) imports are expected to fall by 0.3 Bcf/d (32 percent) in 2012. EIA expects that an average of about 0.7 Bcf/d will arrive in the United States (mainly at the Everett LNG terminal in New England and the Elba Island terminal in Georgia) in both 2012 and 2013, either to fulfill long-term contract obligations or to take advantage of temporarily high local prices due to cold snaps and disruptions.
A 32% drop in US LNG imports portends Downeast LNG's pending demise.
Embracing the Shale Revolution: Let’s export [Editorial] (May 2) — Daily Markets
Today America is completely self-sufficient in natural gas. In fact, we produce more gas than we can use, and soon we will not have enough room to store the surplus gas. Even now, some of the gas produced as a byproduct of oil drilling must be burned off or “flared” as a waste product until customers can be found to buy it.... [Red & bold emphasis added.]
Mexico
Peru LNG ships cargo to Mexico (May 24) — LNG World News
The cargo is being hauled by the Barcelona Knutsen, a 173,400 cubic-meter tanker, and it is sailing to Mexico’s Manzanillo terminal.
North America
North American LNG duo power ahead (May 16) — Petroleum Economist [Paid subscription]
Shaun Polczer, CALGARY: Two proposed LNG terminals in Canada and the US will add 15 million tonnes per year (t/y) to North America’s growing slate of natural gas export options. Shell on 15 May said it is teaming up with South Korea''s Korea Gas Corporation (Kogas), Japan’s Mitsubishi, and China’s PetroChina to develop a 12 million t/y facility at Kitimat, on Canada’s west coast. The $16-billion facility will consist of two 6 million t/y trains and could be online by 2020. Shell will own 40% of the joint venture with 20% for each of the remaining three partners.At the same time Houston-based Excelerate Energy applied for approval of the first floating liquefaction unit in the US Gulf of Mexico, midway between Galveston and Corpus Christi. If approved, Excelerate plans to begin the first of 3 million t/y of exports by 2017. Depending on configuration, the facility can be expanded to...
Passamaquoddy Bay
Office of Energy Projects Energy infrastructure update for April 2012 — Federal Energy Regulatory Commission (FERC)
[The link below will access a PDF file (160 KB). This same article also appears under the Northeast and Gulf of Mexico headings, below. — SPB webmaster]
Natural Gas Highlights
- The Commission dismissed requests by Calais LNG and Calais Pipeline to construct and operate a 1.2 Bcf/d LNG terminal in Calais, Maine, and pipeline facilities connecting the terminal to the facilities of Maritimes & Northeast.
- The Commission vacated the authorizations issued to Jordan Cove and Pacific Connector to construct and operate a 1.0 Bcf/d LNG terminal in Coos County, OR and pipeline facilities connecting the terminal with other pipelines at the OR/CA border.
- Transco placed into service its Bayonne Lateral Project which will provide 250 MMcf/d of capacity to the new electric Bayonne Generation Plant to be located in Hudson County, NJ.
- Sabine Pass LNG received authorization to construct and operate its Sabine Pass liquefaction terminal at its existing site in Cameron Parish, LA. This project will liquefy domestic production and export approximately 2.6 Bcf/d.
- Constitution Pipeline commenced the Commission’s pre-filing process for its Constitution Pipeline Project which will transport 650 MMcf/d of gas produced in PA to interconnections with pipelines in Schoharie County, NY.
- Cameron LNG and Cameron Pipeline commenced the Commission’s pre-filing process for liquefaction, export, and pipeline facilities in Cameron Parish, LA which will provide 1,700 MMcf/d of export capacity. [Red & bold emphasis added.]
Calais LNG was dismissed by FERC, Jordan Cove LNG's permit to construct was vacated by FERC, an LNG export terminal has entered FERC pre-filing, and two new natural gas pipelines have been built in the Northeast— something that Downeast LNG wants the public to believe is too difficult to consider as a means to supply natural gas from plentiful nearby domestic sources to the New England region.
New Brunswick
Trinidad LNG heads for Canada — LNG World News
Repsol YPF SA’s Canaport terminal in Canada is due to get one liquefied natural gas cargo from Trinidad and Tobago on May 25, according to shipping data.
The cargo is being hauled by the Madrid Spirit, a 135,423 m3 tanker, which departed from Trinidad’s Point Fortin LNG terminal on May 20.
New England
New England grid operator moves to address potential LNG supply disruption (May 22) — LNG Law Blog
ISO New England, operator of the region's power grid, filed provisions at FERC to govern grid operations in the event of a significant disruption of LNG supplies used by Boston-area power generators. The action was taken in response to the recent cancellation of imported LNG cargoes from Yemen to Distrigas' LNG terminal at Everett, Mass., due to a militant attack on the Yemeni gas supply line.
Everett LNG imports have been in steady decline since 2007, meaning New England's dependency on LNG is falling. LNG supply disruption due to events in Yemen would be unlikely to impact natural gas supply. But, if that were the case, the long-term solution would be to expand pipeline infrasturcture to avail access to plentiful nearby domestic supply, rather than continuing dependency on unreliable and expensive LNG imports from overseas.
Northeast
Office of Energy Projects Energy infrastructure update for April 2012 — Federal Energy Regulatory Commission (FERC)
[The link below will access a PDF file (160 KB). This same article also appears under the Passamaquoddy Bay heading above, and Gulf of Mexico heading below. — SPB webmaster]
Natural Gas Highlights
- The Commission dismissed requests by Calais LNG and Calais Pipeline to construct and operate a 1.2 Bcf/d LNG terminal in Calais, Maine, and pipeline facilities connecting the terminal to the facilities of Maritimes & Northeast.
- The Commission vacated the authorizations issued to Jordan Cove and Pacific Connector to construct and operate a 1.0 Bcf/d LNG terminal in Coos County, OR and pipeline facilities connecting the terminal with other pipelines at the OR/CA border.
- Transco placed into service its Bayonne Lateral Project which will provide 250 MMcf/d of capacity to the new electric Bayonne Generation Plant to be located in Hudson County, NJ.
- Sabine Pass LNG received authorization to construct and operate its Sabine Pass liquefaction terminal at its existing site in Cameron Parish, LA. This project will liquefy domestic production and export approximately 2.6 Bcf/d.
- Constitution Pipeline commenced the Commission’s pre-filing process for its Constitution Pipeline Project which will transport 650 MMcf/d of gas produced in PA to interconnections with pipelines in Schoharie County, NY.
- Cameron LNG and Cameron Pipeline commenced the Commission’s pre-filing process for liquefaction, export, and pipeline facilities in Cameron Parish, LA which will provide 1,700 MMcf/d of export capacity. [Red & bold emphasis added.]
Calais LNG was dismissed by FERC, Jordan Cove LNG's permit to construct was vacated by FERC, an LNG export terminal has entered FERC pre-filing, and two new natural gas pipelines have been built in the Northeast— something that Downeast LNG wants the public to believe is too difficult to consider as a means to supply natural gas from plentiful nearby domestic sources to the New England region.
Dominion files lawsuit over project — Southern Maryland Newspapers Online, MD
Dominion filed a lawsuit on Friday in Calvert County Circuit Court seeking a declaratory judgment to confirm its right to expand at the Cove Point Liquefied Natural Gas plant in Lusby.
The company filed the complaint in response to the Sierra Club’s claim last month that it has the authority to block the project due to a 1970s legal settlement that was later revised in 2005 to give the organization the ability to reject any significant changes to the purpose or footprint of the existing Cove Point LNG import facility.
Southeast
US FERC approves new compressor at Elba Island LNG terminal (May 17) — Platts
Southern LNG can install a 2,500 horsepower electric compressor at its liquefied natural gas import terminal in Georgia to deal with boil-off gas that is building up due to low import volumes, the US Federal Energy Regulatory Commission announced Thursday.
[F]lush gas supplies and low gas prices in the US have cut US LNG imports, so boil-off gas builds up. When this gas exceeds the capabilities of the terminal's existing 1,500 hp compressor unit, it must use the re-condensers to process it to pipeline pressure, increasing the amount of gas that must be sent out of from the terminal. [Red & bold emphasis added.]
The Elba Island LNG import terminal had previously been considered to be one of the three busiest LNG import terminals in the US.
Gulf of Mexico
Office of Energy Projects Energy infrastructure update for April 2012 — Federal Energy Regulatory Commission (FERC)
[The link below will access a PDF file (160 KB). This same article also appears under the Passamaquoddy Bay and Northeast headings above. — SPB webmaster]
Natural Gas Highlights
- The Commission dismissed requests by Calais LNG and Calais Pipeline to construct and operate a 1.2 Bcf/d LNG terminal in Calais, Maine, and pipeline facilities connecting the terminal to the facilities of Maritimes & Northeast.
- The Commission vacated the authorizations issued to Jordan Cove and Pacific Connector to construct and operate a 1.0 Bcf/d LNG terminal in Coos County, OR and pipeline facilities connecting the terminal with other pipelines at the OR/CA border.
- Transco placed into service its Bayonne Lateral Project which will provide 250 MMcf/d of capacity to the new electric Bayonne Generation Plant to be located in Hudson County, NJ.
- Sabine Pass LNG received authorization to construct and operate its Sabine Pass liquefaction terminal at its existing site in Cameron Parish, LA. This project will liquefy domestic production and export approximately 2.6 Bcf/d.
- Constitution Pipeline commenced the Commission’s pre-filing process for its Constitution Pipeline Project which will transport 650 MMcf/d of gas produced in PA to interconnections with pipelines in Schoharie County, NY.
- Cameron LNG and Cameron Pipeline commenced the Commission’s pre-filing process for liquefaction, export, and pipeline facilities in Cameron Parish, LA which will provide 1,700 MMcf/d of export capacity. [Red & bold emphasis added.]
Calais LNG was dismissed by FERC, Jordan Cove LNG's permit to construct was vacated by FERC, an LNG export terminal has entered FERC pre-filing, and two new natural gas pipelines have been built in the Northeast— something that Downeast LNG wants the public to believe is too difficult to consider as a means to supply natural gas from plentiful nearby domestic sources to the New England region.
Sabine Pass natural gas export project leads controversial trend — AOL Energy
Ten major natural gas export terminal projects are sparking a debate over the complicated balance between low domestic prices and the health of natural gas producers facing contracting returns on their investment in new production.
El Paso seeks U.S. approval to export LNG (May 18) — MarketWatch
In a letter filed [May 15], Southern LNG Company LLC said it sought the authorization to export up to half a billion cubic feet per day from its LNG terminal in Savannah, Ga. [Southern LNG on Elba Island], to any country that has a free-trade agreement with the U.S.
Caribbean
Gov't committed to renewable energy — PM — Jamaica Observer, Kingston, Jamaica, West Indies
"The choices we have to make are very clear. The current level of energy consumption is unsustainable," she said, noting that the introduction of LNG as a part of a short to medium-term plan to diversify the energy supply mix is proceeding apace.
She said the Government has set itself a very ambitious goal to see renewable energy sources making up 30 per cent of the national energy mix by the year 2030.
Concerns raised over JPS LNG plant (May 21) — The Gleaner, Kingston, Jamaica, West Indies
"If we get LNG going and if we build this plant, then we can see some savings in our electricity bill but, when you go into the details of it, you recognise that it is not just about building the plant, but there are some more serious issues we have to consider," he noted.
"What if LNG does not come to Jamaica? What if there is a disruption in the supply of LNG? What is the backup fuel if LNG fails?" he asked.
LNG talks between Jamaica and Trinidad & Tobago back on track (May 16) — Caribbean Press Releases
Bilateral trade talks and negotiations led by the Hon. Anthony Hylton Minister of Industry, Investment and Commerce with the Government of Trinidad and Tobago, have resulted in the re-opening of discussions for the supply of LNG from the twin-island republic to Jamaica.
Alaska
Murkowski promotes Alaskan natural gas to Ambassadors — PennEnergy
U.S. Sen. Lisa Murkowski, R-Alaska, yesterday pitched the U.S. ambassadors of Japan and South Korea on the benefits of importing natural gas from Alaska’s North Slope during a dinner at the Japanese Ambassador’s residence in Washington, D.C.
United States
Obama's got gas (it's natural) — Wealth Daily, Baltimore, MD
What to do with a glut of gas
So what's the solution to our energy independence that the last eight U.S. leaders have missed?
It's so simple, it's complicated: access to cheap energy.
So far, our Commander in Chief has been supportive of LNG exporting projects.
[H]ere's the catch: Obama doesn't have to openly oppose it. Because buried deep in the government's archives is a particular piece of legislation that's been tucked away for decades...
The Export Administration Act of 1969 effectively gave the president the authority to limit or suspend exports of U.S. commodities (among other things) in the interest of national security, short supply, and foreign policy.
I can think of a few individuals who consider our domestic energy supplies — specifically, our cheap natural gas — an interest to national security.
There's a better way to invest in natural gas — and it isn't from potential exporters whose shipments could be cut with the snap of presidential fingers.
Just as we saw in the early days of the U.S. petroleum industry, the real investment potential lies with [domestic natural gas] infrastructure. [Red & bold emphasis added.]
Domestic natural gas is available in massive quantities in the nearby Marcellus Field, mooting the need for Downeast LNG's proposal to build yet another surplus LNG import terminal.
US LNG imports collapse (May 21) — Fairplay 24, UK [Paid subscription]
LNG CARGOES bound for the US were chopped in half during 1Q12, according to US Department of Energy data. ... [Red & bold emphasis added.]
Top
New England
Unrest in Yemen may result in local LNG shortage (May 5) — Boston.com, Boston, MA
Electric power plants in Greater Boston may experience fuel shortages this summer because exports from Yemen, a major supplier of natural gas, have been disrupted by attacks by militants, energy officials said Friday.
No shortages or outages are imminent, but officials are developing contingencies in case a heat wave drives up electricity use or a local power plant has an unexpected outage.
This points to one more reason New England should be using plentiful nearby domestic natural gas and renewables rather than depending on LNG from potentially unstable overseas sources. Contrary to that idea, Downeast LNG would like New England to expand its dependence on unstable LNG supplies while simultaneously creating an even greater trade imbalance.
Northeast
Gulf LNG, Oregon LNG and SB Power Solutions file for DOE LNG export authority (May 16) — LNG Law Blog
[This same article is also posted under Southeast and Gulf of Mexico headings, below.]
Gulf LNG Liquefaction Company, LLC (GLLC) has filed an application (Docket No. 12-47-LNG) with the U.S. Department of Energy (DOE) requesting authorization to export, on behalf of itself or as agent for others, domestically produced LNG from the Gulf LNG terminal in Pascagoula, Miss., to nations having Free Trade Agreements with the U.S. (FTA nations). GLLC seeks to export 11.5 million tons per year of LNG (approximately 1.5 Bcf/d) over a 25-year period.
LNG Development Company, LLC (d/b/a Oregon LNG) has filed an application (Docket No. 12-48-LNG) with DOE requesting authorization to export, on behalf of itself or as agent for others, LNG from its proposed LNG terminal site in Warrenton, Clatsop County, Ore., to FTA nations. Oregon LNG seeks to export up to the equivalent of 456.25 Bcf/year for a 30-year period.
SB Power Solutions (SPS) has filed an application (Docket No. 12-50-LNG) with DOE requesting authorization to export domestically produced and previously imported LNG from various U.S. LNG terminals located on the Atlantic and Gulf of Mexico Coasts to FTA nations located in the Caribbean, Latin America and South America. SPS seeks to export up to the equivalent of 550,000 metric tons (approximately 0.043 Bcf) per year for a 25-year period. [Red & bold emphasis added.]
Gulf LNG in Mississippi is a brand-new LNG import terminal, but is now seeking to export domestically-produced LNG.
Southeast
Elba Island: Billion-dollar switch — Savannah Morning News, Savannah, GA
IMPORTS ARE out. Exports are in. At least that’s what Southern LNG is banking on with its proposed liquefied natural gas terminal on Savannah’s Elba Island.
It was only five years ago when LNG imports were the rule. Now, the nation has a glut in supplies that have sent domestic prices to 10-year lows. Natural gas inventories are set to spill over due to record high production from newly developed gas deposits. [Red & bold emphasis added.]
Southern LNG files for DOE authorization to export LNG from Elba Island terminal (May 17) — LNG Law Blog
Southern LNG has filed an application with the U.S. Department of Energy (DOE) for authority to export from the Elba Island terminal near Savannah, Ga. up to 4 million tons per year (approximately 0.5 Bcf/day) of domestically produced LNG over a 25-year period to countries having a Free Trade Agreement with the United States.
Gulf LNG, Oregon LNG and SB Power Solutions file for DOE LNG export authority (May 16) — LNG Law Blog
[This same article is also posted under Northeast heading, above, and the Gulf of Mexico heading, below.]
Gulf LNG Liquefaction Company, LLC (GLLC) has filed an application (Docket No. 12-47-LNG) with the U.S. Department of Energy (DOE) requesting authorization to export, on behalf of itself or as agent for others, domestically produced LNG from the Gulf LNG terminal in Pascagoula, Miss., to nations having Free Trade Agreements with the U.S. (FTA nations). GLLC seeks to export 11.5 million tons per year of LNG (approximately 1.5 Bcf/d) over a 25-year period.
LNG Development Company, LLC (d/b/a Oregon LNG) has filed an application (Docket No. 12-48-LNG) with DOE requesting authorization to export, on behalf of itself or as agent for others, LNG from its proposed LNG terminal site in Warrenton, Clatsop County, Ore., to FTA nations. Oregon LNG seeks to export up to the equivalent of 456.25 Bcf/year for a 30-year period.
SB Power Solutions (SPS) has filed an application (Docket No. 12-50-LNG) with DOE requesting authorization to export domestically produced and previously imported LNG from various U.S. LNG terminals located on the Atlantic and Gulf of Mexico Coasts to FTA nations located in the Caribbean, Latin America and South America. SPS seeks to export up to the equivalent of 550,000 metric tons (approximately 0.043 Bcf) per year for a 25-year period. [Red & bold emphasis added.]
Gulf LNG in Mississippi is a brand-new LNG import terminal, but is now seeking to export domestically-produced LNG.
Gulf of Mexico
Sempra, GDF Suez deal underpins third train for planned export (May 4) — Oil & Gas Journal
With this agreement of 4 million tonnes/year, Cameron LNG has commitments for the full 12-million-tpy capacity of planned liquefaction that will consist of three liquefaction trains. Construction is set to start in late-2013 with operations beginning in late-2016.
This is the third contract the company has executed to develop the plant. On Apr. 17, Cameron LNG announced the signing of two commercial development agreements with Mitsubishi Corp. and Mitsui & Co. Ltd. for the development of 8 million tpy.
Sempra secures final agreement for new $6 billion LNG facility in Louisiana (May 3) — KPLC-TV, Lake Charles, LA
The [LNG export] facility will be an expansion of the existing Cameron LNG. Sempra Energy, based in San Diego, is investing in the new six billion dollar export facility. [Red & bold emphasis added.]
GDF Suez taps into U.S. LNG market (May 3) — UPI
A new facility, associated with an existing import terminal, will be able to export as much as 12 million tons of LNG per year by 2016.
The United States has some of the largest natural gas reserves, much of which is locked in underground shale rock formations. [Red & bold emphasis added.]
Cameron LNG files response to Sierra Club and APGA at DOE (May 16) — LNG Law Blog
Cameron LNG filed an answer opposing motions to intervene and protests filed by Sierra Club and the American Public Gas Association (APGA) regarding Cameron LNG’s application with the U.S. Department of Energy (DOE) to export domestically produced LNG to countries not having Free Trade Agreements with the U.S. Cameron LNG's answer argues, among other things, that (1) Sierra Club and APGA have not demonstrated an interest warranting intervention, (2) DOE is not responsible for review of environmental issues related to Cameron LNG’s application, and (3) approval of the application will have minimal affects on domestic gas prices. [Red & bold emphasis added.]
Cameron LNG files to initiate FERC pre-filing process for LNG export facilities (May 9) — LNG Law Blog
Cameron LNG has filed a request with FERC to initiate the pre-filing review process for proposed liquefaction and export facilities to be constructed at Cameron's existing LNG import terminal in Hackberry, La. According to the request, Cameron LNG anticipates filing a formal application with FERC in December 2012. Cameron Interstate Pipeline also filed a related request for its proposal to construct facilities to permit bi-directional gas flow to and from the Cameron LNG terminal. [Red & bold emphasis added.]
Sabine Pass to begin initial site preparation for LNG export facilities (May 11) — LNG Law Blog
[May 10th,] FERC granted authorization to Sabine Pass to begin initial site preparation for the construction of LNG liquefaction and export facilities at its existing import terminal in Cameron Parish, La. [Red & bold emphasis added.]
Cheniere Pipeline files to supply Sabine Pass export terminal (May 2) — LNG Law Blog
Cheniere Creole Trail Pipeline, L.P. filed an application at FERC to enable bi-directional gas flow on its system to permit deliveries of feed gas to the Sabine Pass Liquefaction Project. The application states that Creole Trail and Sabine Liquefaction have negotiated a binding transportation precedent agreement for up to 1,530,000 Dth/d of firm transportation service on the Creole Trail Pipeline at a negotiated rate for a 20-year term.
Freeport LNG responds to Sierra Club's protest regarding export application (May 17) — LNG Law Blog
Freeport LNG Expansion, L.P. and FLNG Liquefaction, LLC (together, FLEX) filed an answer to Sierra Club's motion to intervene and protest regarding the FLEX application to export LNG filed with the U.S. Department of Energy (DOE). FLEX states that (1) Sierra Club's protest raises general LNG export policy issues and fails to state a claim of interest specific to FLEX's application, (2) contrary to Sierra Club's claims, DOE may grant approval of FLEX's application conditioned on FERC's environmental review of the project facilities, and (3) Sierra Club has failed to prove that the FLEX proposal is inconsistent with the public interest.
Freeport LNG responds to APGA and GCLC protests regarding DOE export application (May 16) — LNG Law Blog
Freeport LNG Expansion and FLNG Liquefaction (together, FLEX) filed answers to the American Public Gas Association's (APGA) and the Gulf Coast Labor Coalition's (GCLC) motions to intervene and protests regarding the FLEX application to export LNG filed with the U.S. Department of Energy (DOE). Responding to APGA, FLEX argues that APGA's claims of increased domestic gas prices resulting from LNG exports are exaggerated and that limiting LNG exports "would constitute a de facto subsidy to domestic consumers at the expense of domestic producers."
In its answer to GCLC, FLEX states that GCLC has failed to state a claim of interest in the case, has not supported its request for a second public comment period, and has failed to show that the FLEX application is inconsistent with the public interest.
Gulf LNG, Oregon LNG and SB Power Solutions file for DOE LNG export authority (May 16) — LNG Law Blog
[This same article is also posted under Southeast and Northeast headings, above.]
Gulf LNG Liquefaction Company, LLC (GLLC) has filed an application (Docket No. 12-47-LNG) with the U.S. Department of Energy (DOE) requesting authorization to export, on behalf of itself or as agent for others, domestically produced LNG from the Gulf LNG terminal in Pascagoula, Miss., to nations having Free Trade Agreements with the U.S. (FTA nations). GLLC seeks to export 11.5 million tons per year of LNG (approximately 1.5 Bcf/d) over a 25-year period.
LNG Development Company, LLC (d/b/a Oregon LNG) has filed an application (Docket No. 12-48-LNG) with DOE requesting authorization to export, on behalf of itself or as agent for others, LNG from its proposed LNG terminal site in Warrenton, Clatsop County, Ore., to FTA nations. Oregon LNG seeks to export up to the equivalent of 456.25 Bcf/year for a 30-year period.
SB Power Solutions (SPS) has filed an application (Docket No. 12-50-LNG) with DOE requesting authorization to export domestically produced and previously imported LNG from various U.S. LNG terminals located on the Atlantic and Gulf of Mexico Coasts to FTA nations located in the Caribbean, Latin America and South America. SPS seeks to export up to the equivalent of 550,000 metric tons (approximately 0.043 Bcf) per year for a 25-year period. [Red & bold emphasis added.]
Gulf LNG in Mississippi is a brand-new LNG import terminal, but is now seeking to export domestically-produced LNG.
Caribbean
Jamaica seeking equity investors in LNG company (May 2) — The Gleaner, Kingston, Jamaica, West Indies
Jamaica is trying to raise US$100 million (J$8.7 billion) of equity to capitalise the natural gas company formed to oversee the commercial operations of the formative liquefied natural gas (LNG) market.
Under the commercial structure formulated around LNG, JGT [Jamaica Gas Trust] will act as sole buyer of the gas, which will be funnelled through the LNG infrastructure, which will comprise a terminal and pipelines for distribution to end users, such as the Jamaica Public Service Company's 360 MW plant.
The LNG committee headed by Chris Zacca has received three bids for the LNG Floating Storage and Regasification Terminal from Exmar Marine of Belgium; Samsung C&T Corporation of Korea, and Sener Ingenieria y Sisternas, SA of Spain, and is in the process of evaluating them. Jamaica hopes to select a preferred bidder in time for Cabinet to sign off on the selection by June.
Trust to execute commercial agreements under LNG project (May 2) — Jamaica Information Service, Kingston, Jamaica, West Indies
Cabinet has approved the formation of the Jamaica Gas Trust (JGT), which will be the Special Purpose Vehicle that executes the major commercial agreements under the Liquefied Natural Gas (LNG) Project.
Editorial - The Shirley Committee in the aftermath of LNG (May 6) — The Gleaner, Kingston, Jamaica, West Indies
Among the things the LNG steering committee initiated was an appraisal by private lawyers of the tender, which concluded it could not survive judicial review. Indeed, those findings were extensively quoted by the Office of the Contractor General (OCG) in its own investigation of the LNG tender process.
While providing a buffer against exploitative public officials, the Shirley Committee would help government negotiators to extract the best deals possible from the project developers. In that regard, they should help to deliver far more pristine outcomes that would better survive OCG probes.
JPS: LNG still the best option to oil (May 8) — Jamaica Observer, Kingston, Jamaica, West Indies
THE Jamaica Public Service (JPS) has reiterated that Liquefied Natural Gas (LNG) is the preferred option as Jamaica explores alternatives to electricity generation fuelled by oil.
For several months, some stakeholders in the energy sector have been questioning moves by the JPS and the Government to introduce LNG. Some of the observers have suggested that coal would be a less-expensive option. Others have suggested that LNG prices will begin to skyrocket, and have also indicated that Jamaica — based on its size and relatively low demand for LNG — will encounter problems sourcing the commodity from suppliers, who will be keen on selling the product to countries with much higher demand.
Energy Minister in talks with Jamaica, Guyana (May 17) — The Trinidad Guardian Newspaper, Port-of-Spain, Trinidad and Tobago, West Indies
Energy Minister Kevin Ramnarine said yesterday that the Government has given Jamaica a commitment that T&T is willing to reopen talks on the possibility of this country supplying Jamaica with LNG. Speaking with reporters after the opening ceremony of the Trade and Investment Convention which is being held at the Hyatt Regency Trinidad, Ramnarine said that the previous administration had started talks with Jamaica about the supply of LNG.
Trinidad and Tobago to go after oil and gas still in ground (May 18) — Breaking News Trinidad and Tobago, Trinidad and Tobago, West Indies
We must now prepare for the reality of a world where the United States becomes an exporter of LNG and this is something that will form part of that (Energy) policy that we spoke about which is in draft form at the Ministry. [Red & bold emphasis added.]
Alaska
Alaska okays gas line switch to exports, in-state use (May 3) — Oil & Gas Journal
TransCanada Alaska (TCA), the state’s licensee to build a natural gas pipeline from Alaska’s North Slope, received state clearance on May 2 to change the project’s focus to a large-diameter pipeline to an Alaska tidewater site for in-state use and for liquefaction and export. Natural Resources Commissioner Dan Sullivan and Revenue Commissioner Bryan Butcher issued a letter approving a project plan amendment (PPA).
To accommodate the transition, [Natural Resources Commissioner Dan Sullivan and Revenue Commissioner Bryan Butcher] agreed to defer filing a certificate application for an Alberta line with the US Federal Energy Regulatory Commission [FERC] until October 2014. AGPPO said that about half of the work TCA has done so far on the Alberta option, including environmental and engineering studies, could apply to an in-state LNG export line. Some of the Alberta work will continue under the current PPA, either as dual use for an LNG project or to preserve work on the Alberta option for potential transfer to the state under terms of the license. This PPA will prevent unnecessary spending on the Alberta option while the LNG project is being developed, AGPPO explained.
Natural gas line now to terminate in Southcentral (May 3) — Chicago Tribune, Chicago, IL
A plan for a large-diameter pipeline bringing North Slope natural gas to major commercial markets officially shifted Wednesday from one that would send Alaska's gas to the Lower 48 through Alberta to one that would end in Southcentral Alaska and liquefy gas for export on Asia-bound tankers.
Alaska approves TransCanada’s alternate LNG proposal; TransCanada closes Alaska Pipeline open season (May 4) — LNG Law Blog
In a related development, TransCanada Alaska filed a notice at FERC stating that it has terminated its first binding open season for its proposed Alberta Project as no precedent agreements for transportation service were signed with gas producers. The notice states that if the LNG Project moves forward, TransCanada will hold another open season.
Murkowski: Alaska’s Natural Gas a Good Fit for Japan (May 1) — US Senator Lisa Murkowski
WASHINGTON, D.C. – U.S. Sen. Lisa Murkowski, R-Alaska, yesterday continued her efforts to develop new markets for Alaska’s 35 trillion cubic feet of natural gas on the North Slope by raising the potential of providing a long-term, stable supply of energy to Japan with Japanese Prime Minister Yoshihiko Noda at a dinner hosted by U.S. Secretary of State Hillary Clinton.
Alaska’s natural gas resources don’t present the same concerns and controversies that surround potential exports from the Lower 48. Because of Alaska’s geographic position and the glut of shale gas in the Lower 48, there’s currently limited U.S. demand for Alaska’s natural gas. [Red & bold emphasis added.]
British Columbia
LNG Canada project announced (May 16) — LNG Law Blog
Shell Canada Limited and its partners Korea Gas Corporation (KOGAS), Mitsubishi Corporation, and PetroChina Company Limited announced on Tuesday that they are jointly developing a proposed LNG export facility near Kitimat, British Columbia. Shell has a 40-percent working interest in the LNG Canada project, with KOGAS, Mitsubishi and PetroChina each holding 20-percent. The proposed LNG Canada project includes a gas liquefaction plant and facilities for the storage and export of LNG, and will initially consist of two LNG processing trains, each with the capacity to produce six million tonnes of LNG annually, with an option to expand the project in the future.
Canada
Slow pace of LNG projects a concern: Joe Oliver (May 4) — Financial Post, Don Mills, ON
“I am concerned about that,” the minister told reporters Friday. “Japan has a strong interest in our gas as does China and other countries, but the Australians have been moving very rapidly to secure long-term LNG contracts. And that’s where we can lose out because while the [Asian] countries want to expand their sources of supply, they are not going to wait. It’s in their strategic interest to tie-up as much of the resources in long-term contracts as they can, so timing is crucial.”
At least four LNG projects are in various stages of development in Western Canada. Haisla First Nation and LNG Partners secured a 20-year export license from the National Energy Board. Meanwhile, Apache, EOG Resources Inc. and Encana Corp. are proposing a 1.4-billion cubic feet per day joint venture; Shell Canada is looking at a possible LNG plant in partnership with China National Petroleum, Korea Gas and Mitsubishi; Malaysia’s Petronas is studying an LNG project in partnership with Progress Energy Resources Corp; and Imperial Oil Ltd. is also looking to jump on the LNG bandwagon.
“Over the intermediate and longer term we are very much aware that the U.S. has massive shale gas and oil shale which they will be developing, and that’s another critical reason why we have to diversify our markets… demand from the U.S. will not be keeping pace,” the Minister said, adding that Canada needs to find new markets for oil reserves that could be as much as 300 billion barrels, far exceeding the accepted proven reserves of 174 billion – making it the largest concentration of crude reserves anywhere in the world. [Red & bold emphasis added.]
United States
US shale gas production boom, Europe glut to alter the energy and oil landscape — (Reuters) Post, Cape Town, South Africa
A boom in North American shale gas production in the past five years has resulted in sharp falls in domestic power and gas prices there and could turn North America from a gas importer into a large exporter, and a similar development is seen as under way in the oil sector.
Marco Dunand, Mercuria’s chairman and its other co-founder, said at the same summit that “the US and Canada are becoming energy independent and this will turn upside down” and that the geopolitical dynamics of such a shift would be huge. [Red & bold emphasis added.]
US gas exports a threat to Browse: WA Treasury — The Western Australian, Osborne Park, WA, Australia
"...US natural gas prices are at very low levels due to an excess of domestic supply, partly reflecting the exploitation of shale gas reserves...."
Plunging prices for shale gas in the United States have triggered a wave of proposals to build LNG terminals in the US to export surplus natural gas to booming Asia, where prices are higher. [Red & bold emphasis added.]
Obama discusses increased LNG exports to Japan (May 7) — LNG Law Blog
Last week, President Obama met with Japanese Prime Minister Noda and announced that they have agreed to "a new joint vision to guide our alliance," which includes strengthening energy cooperation and discussions on expanding LNG exports from the United States to Japan.
Brookings releases report on U.S. LNG exports (May 2) — LNG Law Blog
[May 2], the Brookings Institution Energy Security Initiative released a report, “Liquid Markets : Assessing the Case for U.S. Exports of Liquefied Natural Gas,” which concludes that “U.S. LNG exports are likely to have a modest upward impact on domestic prices, and a limited impact on the competitiveness of U.S. industry and job creation.” The study also recommends against legislation or regulations that would either promote or limit additional exports of LNG from the United States. [Red & bold emphasis added.]
U.S., Japan complete field trial of methane hydrate production technologies (May 3) — LNG World News
U.S. Energy Secretary Steven Chu announced the completion of a successful, unprecedented test of technology in the North Slope of Alaska that was able to safely extract a steady flow of natural gas from methane hydrates – a vast, entirely untapped resource that holds enormous potential for U.S. economic and energy security.
Building upon this initial, small-scale test, the Department is launching a new research effort to conduct a long-term production test in the Arctic as well as research to test additional technologies that could be used to locate, characterize and safely extract methane hydrates on a larger scale in the U.S. Gulf Coast.
Methane hydrates are 3D ice-lattice structures with natural gas locked inside, and are found both onshore and offshore – including under the Arctic permafrost and in ocean sediments along nearly every continental shelf in the world. The substance looks remarkably like white ice, but it does not behave like ice. When methane hydrate is “melted,” or exposed to pressure and temperature conditions outside those where it is stable, the solid crystalline lattice turns to liquid water, and the enclosed methane molecules are released as gas.
Europe
UK government ordered to comply in LNG safety ruling (May 5) — Western Telegraph, Weybridge, Surrey, UK
There has been a further twist in the long-running saga over the safety of shipping Liquefied Natural Gas (LNG) into the Milford Haven waterway.
Last week the European Commission issued a formal notice over ‘failure to comply with safety rules’.
Safe Haven campign group spokesman Gordon Main said: “The UK Government’s continued reluctance to produce marine LNG risk assessments for Milford Haven, despite assurances to the Commission that it would do so two years ago, has finally run out of time.
New England
FERC summer forecast sees low natural gas prices, potential power problems in California, Texas and Boston, NGI reports (May 18) — EON: Enhanced Online News
In addition to the low prices, "the ability of the natural gas-fired plants to obtain sufficient fuel does not appear to be a significant factor or a market concern during the upcoming summer. In particular, capacity in long-haul pipelines is generally sufficient to avoid disruptions in the use of natural gas for electric generation for this summer," FERC noted.
Northeast
Dominion sues over right to export natural gas (May 18) — CBS Baltimore
BALTIMORE (AP) — Dominion Resources is filing suit challenging a claim by the Sierra Club, which says it has the right to block the company’s plans to export liquefied natural gas from a southern Maryland terminal.
Dominion takes the fight to Sierra Club over natural gas exports (May 18) — Examiner.com
Dominion is requesting that a jury find that it has the right to expand its Cove Point liquefaction plant in Calvert County MD, and to begin exporting liquefied natural gas (LNG) from the site.
[O]n April 26, the Sierra Club announced that it would block any development of the facility. That same day it sent a “cease and desist” letter, requiring Dominion to stop any expansion plans and forbidding it to export LNG by tanker from the site.
[T]he Sierra Club’s new Executive Director Michael Brune recently declared a “war on gas,” similar to the decade-long “war on coal” it has successfully waged against coal-fired power plants, causing over a hundred to shut down.
Dominion files suit over right to export liquefied natural gas from Maryland (May 18) — The Washington Post, Washington, DC
“We’re disappointed and believe that our settlement clearly forbids Dominion’s activities and does not allow for export from the Cove Point terminal,” [Beyond Natural Gas campaign director for the Sierra Club Deb Nardone] said.
Dominion files lawsuit over project (May 18) — Southern Maryland Newspapers Online, MD
The company filed the complaint in response to the Sierra Club’s claim last month that it has the authority to block the project due to a 1970s legal settlement that was later revised in 2005 to give the organization the ability to reject any significant changes to the purpose or footprint of the existing Cove Point LNG import facility.
Dominion gets customers for expansion (May 2) — Southern Maryland Newspapers Online, MD
On Thursday Dominion announced that the company signed binding precedent agreements in late March — one with an unnamed shipper and the other with Sumitomo Corp., “a major Japanese corporation with significant global energy operations,” according to a company press release. Between the two shippers, the planned project capacity is about 750 million cubic feet per day on the inlet and about 4.5 million to 5 million metric tons per annum on the outlet.
Southeast
El Paso applies for LNG export license from Elba Island (May 18) — Reuters
After years of overseeing regular imports to Elba Island, El Paso, like dozens of other companies, is hoping to make the most of a U.S. supply glut by instead exporting LNG, which is natural gas cooled to a liquid for transport by tanker, to higher-paying markets across the globe.
The application comes in the same week that two other export proposals were announced, one operated by Excelerate Energy off the U.S. Gulf Coast and another Shell-led proposal in western Canada.
It marks an about turn for El Paso which has invested heavily in import infrastructure in recent years, before a surge in U.S. shale gas production left that infrastructure largely unused.
Earlier this month, the company applied for an export license from its Gulf LNG import terminal in Pascagoula, Mississippi, which only began operations last June after taking years to build. Since starting up, the terminal has barely received a cargo.
Now eleven projects across the U.S. -- most of which were originally designed for import -- are seeking export licenses. The rush to build export facilities echoes last decade's scramble to build import terminals and is indicative of how fast the U.S. gas market has been turned on its head. [Red & bold emphasis added.]
El Paso's Gulf LNG Pascagoula terminal was brand new in 2011 June — as an LNG import terminal. Now, they want it to be an LNG export terminal.
USA: SLNG files with DOE to export LNG from Elba Island terminal (May 18) — LNG World News
The requested authorization would permit SLNG to export LNG from its Elba Island LNG terminal, located in Savannah, Georgia, to any country with which the United States has, or in the future may have, a Free Trade Agreement requiring national treatment for trade in natural gas and LNG over a twenty- five year period.
El Paso unit asks US Energy Department for LNG export authorization (May 18) — NASDAQ
In a letter filed Tuesday, Southern LNG Company LLC said it sought the authorization to export up to half a billion cubic feet per day from its LNG terminal in Savannah, Ga., to any country that has a free-trade agreement with the U.S.
The move, which follows similar requests by other owners of LNG terminals across the U.S., underscores the dramatic shift that natural gas shale production has created in the country's energy market. LNG terminals were built at great cost during the last decade when investors thought the U.S. would suffer a natural gas shortage, but the abundance of gas unleashed by hydraulic fracturing has rendered them mostly idle. The Energy Dept. has already authorized Cheniere Energy Inc. (LNG) to export LNG from its terminal in Sabine Pass, La. Its first LNG exports are expected towards the middle of this decade.
Elba moves toward exporting LNG (May 16) — Savannah Morning News, Savannah, GA
LNG is currently imported at Elba where it is gasified and sent out via pipeline. However, the increasing development of natural gas supplies in the U.S., combined with increasing demands in foreign markets, make export look like a smart bet. Already, one of the 11 U.S. LNG terminals has been granted permission to add export. Another four have applications pending with federal regulators.
The company’s controversial proposal to re-open its truck loading station on Elba and truck LNG across Savannah via DeRenne Avenue was withdrawn in late March. The current move toward export doesn’t involve a trucking component, Baerg said.
“A key consideration is making sure local authorities are fully aware of all the safety and security issues of this billion dollar investment in an industrial plant within spitting distance of the city center,” [Kent Harrington] said.
Gulf of Mexico
Excelerate Energy to build first U.S. floating liquefaction export facility (May 15) — PennEnergy
Excelerate Energy® L.P. is moving forward with the development of the first floating liquefaction facility in the United States utilizing its Floating Liquefaction Storage Offloading vessel (FLSO™) technology. The Lavaca Bay LNG project will be located in Port Lavaca, situated between Galveston and Corpus Christi on the Texas Gulf Coast, and will be designed to export liquefied natural gas (LNG) to markets worldwide by 2017.
Excelerate Energy selected Port Lavaca for the site of the facility because of its direct access to the highly liquid south Texas natural gas market, access to the Atlantic Basin through the Gulf of Mexico, and potential access to the Pacific basin with the widening of the Panama Canal. The facility will interconnect to the region's existing pipeline system in order to obtain natural gas and liquefy it onboard the vessel. The Port Lavaca location being developed by Excelerate Energy has previously received FERC approval as an LNG import facility, which should facilitate the permitting process.
Excelerate to build first floating U.S. LNG export plant (May 15) — Reuters
The relatively small size of the floating liquefaction project compared to an onshore site could speed up construction, which is expected to take just 44 months, according to Excelerate. Most LNG projects take at least four years to build.
Gulf of Mexico site chosen for first US floating LNG plant (May 16) — Oil & Gas Journal
Initially, Lavaca Bay LNG will consist of one permanently moored FLSO with multiple connections to the onshore natural gas grid in South Texas. The project will be designed with the potential for expansion and the addition of a second FLSO for a total production capacity of up to 8 million tpy.
Passamaquoddy Bay
The last remaining LNG site: Passamaquoddy Bay, Maine (May 1) — Conservation Law Foundation, Boston, MA
As our friends at Save Passamaquoddy Bay 3 Nation Alliance point out, Downeast LNG has “just become the sole remaining LNG import terminal [proposal] on the entire continent.” In light of the already overbuilt capacity for importing LNG, the significant amount of domestic natural gas now flooding the market and bringing prices to an all-time low, and the number of import facilities that are now reversing course to become export facilities, the logic for continuing this quixotic adventure eludes us. For that very reason, FERC dismissed the application of the Calais LNG project, also slated for Passamaquoddy Bay and opposed by CLF in 2010. (Find CLF blog posts on Calais LNG here.) If anything, Maine should focus on more infrastructure to deliver gas to businesses and residents but new sources of natural gas supply are not needed now nor for the next foreseeable 50 years. [Red, yellow & bold emphasis added.]
New Brunswick
Canaport LNG terminal closed for planned work (May 2) — Reuters
The Canaport liquefied natural gas import terminal at Saint John, New Brunswick, will be closed until mid-month as the company works on its C$43 million ($43.5 million) Boil-Off Gas project to cut emissions on the site.
If Downeast LNG's goofball logic were to apply, then "gas-starved" Boston would be without electricity during this shutdown period.
New England
Unrest in Yemen may result in local LNG shortage (May 5) — The Boston Globe, Boston, MA
Electric power plants in Greater Boston may experience fuel shortages this summer because exports from Yemen, a major supplier of natural gas, have been disrupted by attacks by militants, energy officials said Friday.
No shortages or outages are imminent, but officials are developing contingencies in case a heat wave drives up electricity use or a local power plant has an unexpected outage.
Distrigas said it is working with its largest liquefied natural gas supplier in Trinidad and Tobago for additional supplies should there be more disruptions in Yemen.
It has also arranged to deliver some natural gas by pipeline to customers.
One possibility [to alleviate any potential electricity shortage] includes finding a way to quickly hook renewable power supplies, such as solar panels, into the grid.
Remember how LNG terminal supporters have decried opponents as "fear mongers"? How the tables have turned! They're claiming LNG shortages may result (but natural gas shortages are not expected).
LNG imports at Distrigas Everett LNG have fallen steadily since 2007. The Trinidad and Tobago minister of energy projects that their LNG exports to the US will drop to zero.
Plus, they may deliver "some natural gas by pipeline." Imagine that! In reality, numerous pipeline expansion and new pipeline projects are already in the works to deliver more abundant domestic natural gas to New England and the Northeast.
United States
Update 1-US trims natgas output growth view, lifts demand — Reuters
In its May Short-Term Energy Outlook, the EIA said it expected marketed natural gas production in 2012 to rise by 2.9 billion cubic feet per day, or 4.4 percent, to 69.14 bcfd, still a record high but slightly below its April outlook that had output this year at 69.22 bcfd.
Declining production from less profitable dry gas plays like Haynesville in Louisiana will be offset by growth in liquids-rich areas like Eagle Ford in Texas and Marcellus in Appalachia as well as associated gas from rising domestic crude production.
Liquefied natural gas imports are expected to fall by 0.3 bcfd, or 32 percent, to about 0.7 bcfd in 2012. Imports will likely come in the form of contractual cargoes to the Everett terminal in Boston and the Elba Island terminal in Georgia, the EIA said. [Red & bold emphasis added.]
LNG imports at Everett LNG will basically be limited to long-term contracts. Short-term imports at Everett LNG have fallen 60% since 2007.
Embracing the shale revolution [Opinion column] (May 4) — The Cutting Edge News
...Today America is completely self-sufficient in natural gas. In fact, we produce more gas than we can use, and soon we will not have enough room to store the surplus gas. Even now, some of the gas produced as a byproduct of oil drilling must be burned off or “flared” as a waste product until customers can be found to buy it.... [Red & bold emphasis added.]
Shale gas export boom: Planned all along? [News Analysis] (May 4) — NationOfChange
[A]re these merely “free market forces” at work? Legislative history suggests that the answer is not so simple. Enter the Energy Policy Act of 2005.
Many of the key provisions of the Energy Policy Act of 2005 -- including the Halliburton Loophole and LNG import terminal siting rules -- were negotiated in 2001, behind closed doors as part of Dick Cheney’s Energy Task Force, which “met with approximately 300 groups and individuals, ranging from the American Petroleum Institute to Defenders of Wildlife,” according to a list later acquired by The Washington Post.
“FERC's new policy resulted from a public conference in October 2002, during which LNG industry representatives argued that open access requirements deterred investment in new LNG facilities,” explained the U.S. Energy Information Administration (EIA) in a briefing, “Industry representatives said that investors in LNG projects need to be assured access to import terminal capacity in order to advance capital-intensive liquefaction projects in other countries...FERC specifically stated that it hoped the new policy would encourage the construction of new LNG facilities by removing some of the economic and regulatory barriers to investment.
The shale gas industry claims “changing market conditions” -- namely, a market glut -- has created pressure to now transform some of these import terminals into export terminals. Further, given the hefty price tag of LNG terminals, developers say it makes economic sense to site export terminals at existing import terminals, where the infrastructure is already in place.
But did the gas industry really not see a boom in domestic gas drilling coming?
Global tremors from a US gas explosion (May 4) [Commentary] — Business Spectator, Melbourne, Victoria, Australia
The US will not export its gas like Australia. As pointed out the The Economist in recent weeks, the Third Industrial Revolution – where manufacturing becomes a high-tech, automated process – will require greater access to cheaper, cleaner energy. Low cost [natural gas] will speed up this revolution. Combined with the European downturn, the US transformation will slow the export growth rate of China. The Chinese will have to develop less mineral intensive activities, like consumer demand, to maintain growth levels.
Brookings study urges no government action on LNG exports (May 3) — Oil & Gas Journal
US policymakers should not enact legislation or regulations that would either promote or limit additional exports of LNG from the US, a Brookings Institution study issued on May 2 concluded. Costs associated with producing, processing, and shipping the gas, and the global markets in which it will compete, will put upper limits on the amount of LNG it would be economic to export, it said.
Policies to promote more LNG exports would be a mistake, they emphasized. “We seem to get it wrong investing in natural gas,” Kenderdine said. “We have a long history of misfires on gas policy.”
...The gas business “has broken more hearts than any Hollywood starlet,” [managing director of research at ClearView Energy Partners LLC Kevin Book] added.
North America
LNG export opportunities – The strategies and challenges for North American gas export — LNG Export Forum North America
LNG Export Forum North America — 2012 May 16–18 — Houston, Texas
LNG export from North America has been moved to the forefront of the latest global gas industry developments. Cheniere’s recent groundbreaking sales purchase agreements - the first of their kind – have been quickly followed by other agreements in the United States and Canada. LNG export in North America is now a tangible reality and is poised for significant commercial success.
The LNG Export Forum will focus on these issues and more and give delegates a unique insight into the huge commercial opportunities for North American LNG export.... [Red emphasis added.]
Europe
LNG port safety ruling – UK compliance demanded (May 7) — MarineLink, New York, NY
Commission spokesman Joe Hennon said: “The failure in question concerns the assessment of potential risks from LNG tankers approaching and berthing at Milford Haven.” [Red, yellow & bold emphasis added.]
Prior to approval of the two LNG terminals in Milford Haven, retired port pilots complained that one proposed LNG terminal did not comply with SIGTTO terminal siting best safe practices; that the LNG tanker's berth was too close to the shipping fairway. (See: "Ex-Ships Pilots Warn on Plans for Port", 2005 Jul 7, WalesOnline, and "LNG sites slammed," 2005 Jun 22, Western Telegraph, Haverfordwest, Pembrokeshire, Wales, UK)
Downeast LNG is pulling the same "ignore our own industry's best safe practices" stunt as the project in Wales that is now under European Union scrutiny for safety violations.
Middle East
Tugboat explosion kills 7 off Qatar (May 6) — gCaptain
Nearly a week ago, 7 people were killed off Qatar when an offshore LNG buoy terminal exploded unexpectedly. Tugboat 53, which is part of the Svitzer/Nakilat fleet in Qatar, was conducting maintenance on the buoy at the time of the incident.
SIGTTO (Society of International Gas Tanker and Terminal Operators, an organization that represents virtually the entire world LNG industry) warns against siting an LNG berth near other port traffic, since other vessels present an ignition hazard — as this tragedy demonstrates.
Downeast LNG's proposed ship berth would jutt well out into the waterway — approximately 3,862 feet from shore — into the mouth of the Saint Croix River, where heavily-laden cargo vessels already transit, along with pleasure craft and fishing boats. Downeast LNG's siting presents both an LNG vapor ignition hazard and an allision hazard, with potential resulting LNG release. (Definition of allision — [nautical term] a moving vessel striking a stationary ship or object.)
Downeast LNG's terminal site is contrary to the LNG industry's own best safe practices. (See LNG Terminal Siting Standards Organization for an abbreviated list of SIGTTO terminal siting best practices.)
Gulf of Mexico
Sabine Pass requests authorization to begin site preparation — LNG Law Blog
Yesterday, Sabine Pass Liquefaction, LLC and Sabine Pass LNG, L.P. (Sabine Pass) filed a supplemental Implementation Plan with FERC to comply with certain environmental conditions contained in FERC's order authorizing construction of LNG export facilities at the Sabine Pass terminal. Sabine Pass also requested authorization to commence site preparation activities for construction at the earliest date possible, but no later than May 15, 2012. [Red & bold emphasis added.]
United States: FERC approves LNG export project (Apr 29) — Mondaq
Sabine Pass is granted an NGA Section 3 authorization to site, construct, and operate facilities to liquefy and export domestically produced natural gas.
On April 16, the Federal Energy Regulatory Commission (FERC) granted Sabine Pass Liquefaction and Sabine Pass LNG (collectively, Applicants) authorization to construct and operate facilities to liquefy and export domestically produced natural gas at the existing Sabine Pass Liquefied Natural Gas (LNG) terminal in Cameron Parish, Louisiana. The project will be constructed in two stages, each with two LNG process trains containing gas treatment facilities, gas turbine-driven refrigerant compressors, cold boxes and heat exchangers for cooling and liquefying natural gas, waste heat recovery systems, and other facilities. Upon completion, the terminal will operate simultaneously as a bi-directional LNG facility for export and import service. The facilities will enable the companies to liquefy and export up to 16 million tons per annum, or 2.2 Bcf per day. Sabine Pass Liquefaction has secured 20-year LNG Processing Services Agreements with entities in Great Britain, Spain, India, and Korea to sell 3.5 million metric tons of LNG per year to each entity.
Cheniere Marketing files for re-export authority — LNG Law Blog
Cheniere Marketing, LLC has filed an application with the U.S. Department of Energy (DOE) for a two-year, blanket authorization to export, on behalf of itself and as agent for other parties, up to 500 Bcf equivalent of previously imported LNG from the Sabine Pass LNG terminal. Cheniere requests authority to export the LNG 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. DOE’s notice of the application sets May 31, 2012 as the deadline for comments. [Red & bold emphasis added.]
Aurora looks for acquisitions in Eagle Ford with low natural gas prices — PennEnergy
An Australian company that is active in Texas' Eagle Ford shale is looking at potential acquisitions and partnerships as natural gas prices have plummeted in North America.
In early April, prices of natural gas futures fell below $2 per million British thermal units, which is as low as they've been in 10 years. In addition to leading companies like Aurora to look at potential deals, these low prices have spurred much talk about the creation of LNG [export] terminals in the U.S.
Caribbean
T&T energy facing three major crises, says Julien (Apr 30) — Trinidad Express Newspapers, Port-of-Spain, Trinidad and Tobago, West Indies
The country needs to arm itself for the possibility that one of its export markets–the US– will soon be exporting LNG, he said.
The first crisis, he said, was the dramatic drop in natural gas prices–from an average of US$4-$5 in 2011 to hovering around US$2 in 2012-–which does not augur well for T&T's energy-dependent economy. [Red & bold emphasis added.]
Northwest Territories
Northwest Territories open to LNG option — Reuters Canada
A month after proponents of the Mackenzie Valley gas pipeline said they had chopped spending on the project, David Ramsay, the territories' minister of industry, tourism and development, said LNG [export] has to be looked at as an option.
United States
Frank C. Fisher weighs in on current oil, natural gas debate [Press release] — 24-7 Press Release
The current discussion and debate over the state of natural gas comes, ironically, after an unprecedented boom in gas production. Currently, supplies of natural gas are estimated to be higher than they have been in a hundred years. Prices, meanwhile, are lower than they have been in a decade. The industry response has been to decrease drilling for natural gas while also focusing their resources on oil drilling. [Red, yellow & bold emphasis added.]
US natural gas price nears $10 per barrel equivalence [Opinion column] — Energy Tribune, Houston, TX
While the average pump price of gasoline has held the attention of most Americans for much of this year, the price trend for natural gas has been equally dramatic in the opposite direction. Gasoline prices flirted with the psychologically important $4 per gallon mark for several weeks before receding to around $3.82 today. Meanwhile natural gas prices continued their steady drift downward, briefly crossing $2 per million BTUs (MMBTU) before recovering slightly. To put this in perspective, when the spot price of natural gas bottomed out at $1.82 earlier this month, it was selling for the energy equivalent of oil at $10.56 per barrel. The last time oil prices were that low was during the Asian economic crisis of the late 1990s, and we're still feeling the consequences of that crash. The longer-term impact of today's dirt cheap natural gas is likely to be quite different, however. [Red, yellow & bold emphasis added.]
Embracing the shale revolution [Op-ed] — The Hill, Washington, DC
Today America is completely self-sufficient in natural gas. In fact, we produce more gas than we can use, and soon we will not have enough room to store the surplus gas. Even now, some of the gas produced as a byproduct of oil drilling must be burned off or “flared” as a waste product until customers can be found to buy it.
The price of gas has fallen to below $2 per 1,000 cubic feet, almost one-seventh of the price four years ago. Cheap gas has resulted in lower electricity and heating bills for American consumers and reduced energy costs for U.S. manufacturers. It has spurred construction of plants that make chemicals, plastics, steel and other products. Thousands of jobs have been created, and cheap gas helps U.S. manufacturers compete for new markets worldwide.
...The U.S. Energy Information Administration estimates that the United States has natural gas resources that can last more than 100 years at the current rate of use. [Red, yellow & bold emphasis added.]
US Chemical Manufacturers’ group resists calls for limits on LNG exports: Platts Energy Week [Press release] (Apr 30) — Platts
The United States' shale gas boom bodes well for domestic chemical manufacturers, which often use natural gas as base feedstock, but some in the chemical industry want to limit US exports of natural gas to keep prices low, the head of the industry's trade group said Sunday on Platts Energy Week, on the all-energy news and talk show program.
Cal Dooley, president and CEO of the American Chemistry Council, said that such restrictions on natural gas exports could end up hurting the industry, if they cause gas developers to cut back on production.
Dooley's comments differed from those of Dow Chemical CEO Andrew Liveris, who said recently that the US should not allow too much natural gas to be exported, since the industry is counting on U.S. prices staying low.
North America
Fitch: Push for North American LNG export capacity accelerating [Press release] — MarketWatch
Cheniere Energy's receipt of final regulatory approval on April 16 for a $10 billion LNG export terminal in Cameron Parish, LA, has increased pressure on other project sponsors to move quickly to lock up long-term supply contracts with international customers anxious to find cheaper LNG import sources. Dominion Resources followed the Cheniere decision quickly by announcing last week that it would move ahead to construct its Cove Point liquefaction and export facility in Maryland. That project still requires final regulatory approval.
Outlets for exports of Canadian gas exist already in Apache Canada's Kitimat export terminal in British Columbia. At least two other terminal projects in that province are being proposed. Cost advantages for Canadian suppliers could be particularly large in key Asian markets as a result of lower transportation costs from Pacific ports.
Update on shale gas revolution, pt. 1 — Zacks
The most important, and most recent, news is that Royal Dutch Shell is apparently in the preliminary stages of feasibility and design work on a potentially huge, $10 billion, 2 million gallon per day (approximately 50,000 barrels per day) Gas-to-Liquids (GTL) facility in Louisiana, using abundant natural gas feedstock.
First, it validates the long-range forecast of persistently high volumes of economical natural gas. Since the plant would not enter production until 2014 at the earliest, a gigantic, experienced GTL and gas producer must be confident that natural gas prices will remain a relative bargain, and that this will continue for a long time into the life of the plant.
While it may be cheaper to build gas liquifaction and re-gassification plants, their economics may not be able to overcome the huge price differential of products versus raw gas for a long time to come. This could mean that new LNG plants for Kitimat, British Columbia, and Valdez or Anchorage, Alaska, and, more fancifully, Halifax, Nova Scotia, may not be built -- in favor of GTL plants.
Russia has not yet advanced any pipeline proposals to Japan, but it could make a lot of sense to both parties. If that occurs, then there could be substantial gas-on-gas competition that will benefit the customer -- and be unpleasant for North American LNG exporters, increasing the attractiveness of building GTL plants versus LNG ones on the West Coast.
Keep in mind that experienced natural gas industry participants also bought into the idea that the US needed a gargantuan overbuild of LNG import infrastructure that is now collecting dust and creating debt.
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