"For much of the state of Maine, the environment is the economy"
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2016 July 30
Liquified Natural Gas is the next big thing for Atlantic Canadians, especially those in Nova Scotia. Currently, the development of a 327- acre site in Point Tupper, Nova Scotia is about to become the big LNG play that promises to change the oil and gas dynamics of the region. Bear Head LNG Corporation, Inc. is developing an 8-12 mtpa LNG export terminal in which several billion dollars will be spent on design, completion of engineering work, and construction of liquefaction facilities at the Bear Head LNG site.
Bear Head LNG Corporation Inc. is a wholly owned subsidiary of Liquefied Natural Gas Limited (LNGL), an Australian Public company. LNGL’s patented OSMR® (Optimized single mixed refrigerant) process. OSMR® is a low-cost, highly efficient, environmentally friendly, robust and low-risk technology.
The feed gas supply for the terminal is expected to come from a combination of Canadian and US producers. Based on economic viability, the gas for this new LNG terminal could potentially come from the offshore oil and gas industry in Eastern Canada as well as western Canada and strategic locations across the USA. Given that gas has not been an economically viable option for eastern Canada to date and the lack of other developments in the oil and gas sector, this new point of sale, coupled with LNGL’s innovative technology, may advance enough to see gas become the next offshore commodity for the regions.
Progressing in parallel is another significant project: the Bear Paw Pipeline Project. Bear Paw Pipeline Corporation Inc is also a wholly owned subsidiary of LNGL and Bear Head LNG’s sister company. Complementing the LNG terminal, the construction of the Bear Paw pipeline and compression station will be taking place. This will ensure that gas is transported responsibly from Goldsboro to the Bear Head facility.…
The Bear Head LNG project requires Canadian federal, provincial, and local regulatory approvals to construct a liquefied natural gas export facility. All 10 initial Canadian permits are in place, including an approved environmental assessment; permits to construct a gas plant facility from the Nova Scotia Utility and Review Board; a Div V industrial approval from Nova Scotia Environment and a development permit from the municipal government in Richmond County. Canada’s National Energy Board (NEB) has granted Bear Head LNG authorization to import natural gas from the U.S. and to export up to 8 mtpa of LNG from Canada, with authority to expand to up to 12 mtpa in the future.
The Bear Paw Pipeline Project is currently undergoing an Environmental Assessment process with Nova Scotia Environment, and a permit-to-construct process with Nova Scotia Utility and Review Board (NSUARB).…
Webmaster's comment: Bear Head LNG requires natural gas supplies from western Canada and/or the Marcellus shale region of the US. That would require reversal of the Maritimes & Northeast Pipeline, part of which tranists through the State of Maine, and past the proposed but wilting Downeast LNG terminal in Robbinston.
Both opponents and proponents of Spectra Energy’s Access Northeast gas pipeline expansion outlined their stances during a capacity-filled Board of Selectmen’s meeting on Tuesday night, with approximately 25 attendees wearing bright red shirts declaring their opposition to the controversial project.
The developers of the project, which include Eversource and National Grid, are seeking federal approval to construct new and improved pipeline facilities along a 125-mile route from New York state to eastern Massachusetts, including a five-mile stretch of new 30-inch pipeline in Canton. The proposed route would go from Cobb’s Corner into Stoughton, then head northeast under Pleasant Street, Turnpike Street, and finally York Street before ending just south of Randolph Street.
Besides a vote by selectmen on whether to grant survey and construction approval, the plan will go before the state Department of Public Utilities (DPU) for a formal hearing in the coming weeks. Already the state Senate has voted unanimously in opposition to the proposed tariff on electrical ratepayers and 61 communities, including Sharon, have opposed the plan, according to No Canton Gas Pipeline. [Colored & bold emphasis added.]
The U.S. Court of Appeals for the D.C. Circuit has issued an opinion remanding to FERC for further explanation how FERC’s orders, which permitted Statoil Natural Gas, but not BP Energy, to turn back certain capacity held on Dominion Cove Point LNG’s system, were not unduly discriminatory as to BP Energy under Natural Gas Act.
The U.S. Court of Appeals for the D.C. Circuit has issued an opinion rejecting EarthReports’, Sierra Club’s and the Chesapeake Climate Action Network’s joint appeal of FERC’s orders, which authorized construction and operation of the Dominion Cove Point LNG export terminal at Lusby, Md. According to Law360, the Petitioners, among other things, “claimed that FERC flouted the National Environmental Policy Act by failing to analyze [the project’s] impacts on future gas production and greenhouse gas emissions.” Citing its recent opinion in the Sabine Pass LNG terminal case, the Court rejected those claims, ruling that “FERC reasonably concluded that a link between a specific LNG project and gas production is too speculative to be considered an indirect impact.” The Court ruled that the U.S. Department of Energy was responsible for conducting the required environmental impact review associated with natural gas exports. [Colored & bold emphasis added.]
Webmaster's comment: If FERC's environmental impact review for Dominion Cove LNG was anything like its Environmental Impact Statement (EIS) for Downeast LNG, there is a lot more wrong in the document than impacts on future gas production and greenhouse gas emissions. Problems existing in FERC's Downeast LNG EIS: Intentionally omitting mention of conditions detrimental to the project; Outright false claims; failure to consider Native American rights re damage or destruction, and reduced or blocked access, to a cultural and spiritual site; failure to recognize significant flaws in LNG design release modeling; refusal to consider the results on design release modeling of simultaneous damage to the proposed vapor fences and LNG piping on the marine trestle; and more.
Reuters reports that Shell has indefinitely delayed a final investment decision (FID) for its affiliate BG Group’s proposed Lake Charles LNG export terminal at Lake Charles, La. In February, Shell Canada, primary sponsor of LNG Canada, indefinitely postponed an FID on its proposed LNG export terminal at Kitimat, British Columbia. [Colored & bold emphasis added.]
On July 25, the liquefied natural gas (LNG) vessel Maran Gas Apollonia became the first-ever LNG vessel to transit the recently expanded Panama Canal. The vessel is carrying LNG sourced from the U.S.-based Sabine Pass liquefaction terminal located in Louisiana. The expanded Panama Canal can now accommodate 90% of the world LNG tanker fleet. Transit through the Panama Canal reduces travel time and transportation costs for LNG vessels traveling from the Atlantic Basin liquefaction terminals, located primarily on the U.S. Gulf Coast, to key markets in Asia and the west coast of South America.
The first liquefied natural gas vessel from the lower 48 U.S. states is on its way to China, according to a Reuters interactive map on Friday, the latest sign that the expanded Panama Canal is allowing U.S. exports to reach the world's top LNG buyers in Asia.
Royal Dutch Shell's (RDSa.L) Maran Gas Apollonia loaded up with gas at Cheniere Energy Inc's (LNG.A) Sabine Pass LNG export plant in Louisiana, the map showed. It passed through the canal earlier this week and was moving northwest up the west coast of Mexico on Friday afternoon.
So far, gas from Sabine has been delivered to South America, India, the Middle East and Europe.
The staff of the Federal Energy Regulatory Commission (FERC or Commission) has prepared a final environmental impact statement (EIS) for the Golden Pass LNG Export Project proposed by Golden Pass Products, LLC and Golden Pass Pipeline, LLC (collectively referred to as Golden Pass).
FERC’s environmental staff concludes that construction and operation of the project would result in some adverse and significant environmental impacts; however, most impacts would be reduced to acceptable levels with the implementation of Golden Pass’ proposed mitigation and additional measures recommended by staff. This determination is based on a review of the information provided by Golden Pass and further developed from data requests; field investigations; scoping; literature research; alternatives analysis; and contacts with federal, state, and local agencies as well as Indian tribes and individual members of the public.…
Webmaster's comment: Surprise, surprise. FERC decides that environmental impacts would be reduced to acceptable levels. The only time FERC has made a different determination was with the Jordan Cove LNG terminal, in which FERC denied the permits because the project had no customers (thus, impacts on the environment could not be justified). Apparently, if a project has customers lined up, then environmental impacts are insignificant.
The U.S. Department of Energy (DOE) has issued an order granting Eagle LNG Partners Jacksonville LLC (Eagle LNG) authority to export 49.8 Bcf/year (0.14 Bcf/day) of LNG from its proposed production, storage, and export facility on the St. Johns River in Jacksonville, Fla. Eagle LNG is authorized to export the LNG over a 20-year period to nations with a Free Trade Agreement (FTA) with the United States via ocean-going LNG carrier vessels and via approved ISO IMO7/TVAC-ASME LNG containers loaded onto container vessels.
The U.S. Department of Energy (DOE) has issued an order granting Venture Global Plaquemines LNG, Inc. (Plaquemines LNG) authority to export 1,240 Bcf/year (3.4 Bcf/day) of LNG from its proposed liquefaction and export terminal near mile marker 55 on the Mississippi River in Plaquemines Parish, La. Plaquemines LNG is authorized to export the LNG via vessel over a 25-year period to nations with a Free Trade Agreement (FTA) with the United States.
FERC has released an update on its review of Port Arthur LNG’s proposal to construct liquefaction, LNG export terminal and interconnected pipeline facilities at Port Arthur, Texas. FERC is currently conducting its pre-filing environmental review process for the project and will provide comments to Port Arthur LNG on its revised Resource Reports 1 (General Project Description) and 10 (Alternatives). Port Arthur LNG will incorporate the comments in the Resource Reports it will submit with its formal application for the project, which is anticipated to be filed in September 2016.
FORT ST. JOHN, B.C. – Adding yet another twist to a lengthy environmental assessment that has already been delayed several times, hereditary chiefs of two northwest BC First Nations are seeking to extend it another 4 months.
They argue while there’s been consultation with councils of six area Indian Act bands, it has not extended to the hereditary tribes and houses, the proper land and aboriginal rights holders, whose aboriginal rights and titles will potentially be infringed by the project.
Fisheries and Oceans Canada has told the federal environmental regulator that Pacific NorthWest LNG’s plan to build a liquefied natural gas terminal in northern British Columbia poses a low risk to juvenile salmon habitat.
Environmentalists and some First Nations argue that Pacific NorthWest LNG’s construction activities would devastate Flora Bank, a sandbar with eelgrass that nurtures young salmon. The LNG joint venture, led by Malaysia’s state-owned Petronas, is seeking to build an $11.4-billion export terminal on Lelu Island, which is located next to Flora Bank in the Skeena River estuary.
But the [Fisheries and Oceans] letter warns that construction could endanger marine mammals, such as the harbour porpoise.
The federal Liberal cabinet is expected to decide by early October on whether to approve Pacific NorthWest.
Flora Bank must be protected, [Lax Kw’alaams former mayor Garry Reece] said, pointing to scientific evaluations commissioned by the Lax Kw’alaams that indicate “a serious risk to the fisheries habitat and marine environment.” He also criticized the Port of Prince Rupert for promoting the Lelu Island site instead of touting other locations, and recalled that he raised concerns dating back to his meeting with Petronas officials in late 2012.
Last October, Finance Minister Mike de Jong predicted: “We are poised to see the final steps taken. Every step of the way, there have been detractors and naysayers and people who have dismissed the opportunities.”
Those final steps hit a speed bump last Friday when the Hawaii Public Utilities Commission nixed NextEra Energy’s proposed $4.3 billion purchase of Hawaiian Electric Industries.
Last August, [Hawaii's] governor, David Ige, made it clear that “Any time and money spent on LNG is time and money not spent on renewable energy and that his administration will actively oppose the construction of any future LNG receiving stations.”
Despite countless reports that the world faces a glut of LNG, the government's website to this day proclaims that “Global trade in liquefied natural gas doubled between 2000 and 2010 and is expected to increase by another 50 per cent by 2020.”
B.C.'s long-promised pot of liquid gold has now passed through pretty well all the spin cycles. [Colored & bold emphasis added.]
Latest developments in Hawaii should put end to faith in job, prosperity promises.
The export [to Hawaii] deal – a long shot at best – was pronounced dead this week.
Premier Christy Clark continued to proclaim that the LNG industry would reduce air pollution in China, clear up smog in Los Angeles and that revenues would fund increased support for people with disabilities.
Naysayers such as the Australia-based Macquarie Group, the Paris-based International Energy Agency (IEA) and Bloomberg News were dismissed out of hand.x
The Macquarie Group, a giant in global investment banking and finance, suggested earlier this year that solutions to address the LNG oversupply “would be for certain LNG expansions not to happen or for existing capacity to be closed.”
And in its November 2014 World Energy Outlook, the IEA reported that Canadian LNG costs could be among the highest in the world, pegging the export price at between $13 and $14 per MBtu (million British thermal unit).
LNG’s spot price – currently less than $5 per MBtu – is less than half the costs of production for LNG from the province.
B.C. may still see an LNG plant. But as for that $1 trillion in economic activity and $100 billion Prosperity Fund, the only step left is to call time of death. [Colored & bold emphasis added.]
WCC LNG the second proposed export facility to receive extension on original 25-year licence
WCC a liquefied natural gas (LNG) export facility that's being jointly pursued by Imperial Oil and ExxonMobil, this week received a 15-year extension to its LNG export licence from the National Energy Board (NEB).
The project is planned for the Tuck Inlet, a deepwater port near Prince Rupert. It would have an initial capacity to ship up to 15 million tonnes of LNG a year to buyers in Asia. The gas would be sourced from Northeast B.C. and transported to the coast via either Spectra Energy Corp.'s $7.5 billion Westcoast Connector Gas Transmisison project or TransCanada Corp.'s $5-billion Prince Rupert Gas Transmission line.
The 15-year extension to the company's export licence is the result of new legislation introduced through Canada's Economic Action Plan passed by the former Conservative party government in June 2015. The change allowed for natural gas export licences to be extended to a term of 40 years, up from the previous 25.
WCC LNG originally received a 25-year export licence in December 2013.
It's the second project to receive an extension under the new legislation. The Shell-led LNG Canada project was the first, gaining approval for its 15-year extension to its 25-year licence in January.
If no gas is exported within 10 years of July 28, the licence will expire. [Colored & bold emphasis added.]
"There was a false expectation that we'd have a debt-free B.C. and a prosperity fund. It just didn't come to fruition, and we're disappointed in that," Sigurdson said.
Wilberforce, the California-based Gordon and Betty Moore Foundation, Hawaii-based Sustainable Fisheries Partnership and others have poured money into anti-LNG campaigns in B.C., as they funded opposition to oilsands development before them. Indeed, the record suggests the long project to establish what environmental front groups named the Great Bear Rainforest was a strategy to stop hydrocarbon exports from western Canada, even as U.S. sources ramped up production.
A video series called “A Last Stand for Lelu” shows two self-styled warriors confronting drilling vessels.
As a non-native journalist on Squamish Nation territory, I sometimes find myself surrounded by other non-natives as they discuss the motives and actions of the Nation, specifically its decisions around the liquefied natural gas facility. I’ve heard intelligent, thoughtful “white” people say things about First Nations that make me wonder if Jean Chrétien is still in power and Eaton’s still anchors the mall (Google it, kids).
While there may be plenty of reason to disagree with the decision of the Squamish Nation to conditionally support both the Woodfibre LNG project and the pipeline – some Nation members have loudly done so themselves – we need to check our stereotypes. Agree or disagree, we must do so in a way that honours the complexity of the issues and each other. Otherwise, we will remain in the 1990s forever, and no one wants that – even if it did have those sexy threadbare wool sweaters.
After seeing their plans shot down by federal regulators earlier this year, the developers of a proposed liquefied natural gas plant and connector pipeline that would move gas from fields in Wyoming and other Rocky Mountain states to the west coast for shipment to Asian markets are confident the two projects will still be built and begin shipping fuel to Japan in the not-too-distant future.
The application for the Jordan Cove LGN terminal and storage facility in Coos Bay, Ore., was denied in March by the Federal Energy Regulatory Commission, which cited a demonstrable lack of demand for the liquefied gas as its prime reason for deciding against the project. Calgary-based Veresen and its pipeline collaborator, the Williams Partners, still plan to locate the plant in the southern Oregon coastal town, and feed it with the proposed Pacific Connector pipeline, which would carry LNG from an existing hub in Malin, Ore., to the deep-water Pacific port. The Malin hub is supplied by the existing Ruby pipeline, which carries LNG from its eastern terminal — the Opal hub in southwest Wyoming — for distribution to customers in northern California.
Braddock said the FERC’s contention that the company had failed to show a demand for LGN that would justify the projects was valid, but only because Veresen was bound by confidentiality concerns that would not allow it to disclose several potential customers at the time of the commission’s hearings on the project. He said if the hearings had been held 60 days later, there would have been “a different outcome.”
With those restrictions having expired, Braddock told the WPA that two Japanese energy companies — Jera and Itochu — have each committed to purchase 25 percent of the Jordan Cove plant’s capacity and that two other Japanese firms are lined up to claim the other 50 percent (although confidentiality agreements with those to firms are still in place at this point).
Braddock said that he expects the FERC will give the project applications a rehearing in the fall, with full authority to proceed with the project coming in 2017. He expects the project to be completed by 2022, which would closely coincide with the end of the expiration of the Japanese companies’ current supply contracts.
The FERC approval of the resubmitted applications would not be a slam dunk, however, as he said the company expects to face opposition from strong environmental contingent in Oregon, which is dead set against the projects due to concerns over climate change. [Colored & bold emphasis added.]
Webmaster's comment: Jordan Cove LNG did not have their ducks in a row, and failed the permitting process. Now, they are saying things will be different — even though they still don't have their ducks in a row.
The U.S. began shale gas exports by sea this year and is projected by the International Energy Agency to become the world’s third-largest liquefied natural gas supplier in five years. Gas will challenge coal at European power plants and become affordable in emerging markets, where prices have been high and supplies limited, according to the IEA and Goldman Sachs Group Inc.
Cheniere Energy Inc. has sent 19 tankers of the liquefied gas abroad from its Sabine Pass terminal in Louisiana. By 2020, five terminals will be operating on the U.S. Gulf Coast and in Maryland. Global export capacity will surge 45 percent and the U.S.’s share will jump to 14 percent from nothing, according to Energy Aspects Ltd.
The change will weigh on already low global LNG prices. The WGI Northeast Asia spot LNG price has averaged just $5 per million British thermal units this year, a premium of $2.83 over benchmark U.S. prices. Two years ago, the gap was about $10. The premium for U.K. futures to the U.S. narrowed by almost half to $2.17.
The widening of the Panama Canal is going to have an impact as well. It’s now able to handle most of the world’s LNG tankers and will reduce time and costs for U.S. cargoes to destinations such as Chile and Japan.
Natural gas liquefaction and export facility at Pampa Melchorita, Peru, recently dispatched another cargo to Mexico.
Mexico’s Manzanillo LNG terminal in the Colima state is the most likely destination of the Peruvian cargo although, Perupetro has not confirmed the exact destination of the vessel.
The Manzanillo LNG terminal on Mexico’s Pacific coast is showing healthy demand, unlike most other terminals in Latin America. This has attracted cargoes from as far afield as Australia and Nigeria, presenting a challenge to traditional suppliers such as Trinidad & Tobago and Peru. The recent expansion of the Panama Canal has also paved the way for LNG from the United States to reach the terminal. Nonetheless, the prospects for Manzanillo’s LNG imports remain weak in the medium-to-long term because of the growing popularity of US pipeline gas.
CALGARY — The passage of two LNG tankers through the Panama Canal on Monday and Tuesday marked a long-expected shift in global LNG shipping patterns, albeit one that comes amid a souring outlook for natural gas markets that has already hampered projects in the U.S. and British Columbia.
[The Panama Canal] expansion will have a limited effect on the economics for new LNG developments on Atlantic coastlines like the U.S. Gulf Coast. “The way the global market has changed the last couple of years, and all of the supply that’s coming on, its significance is going to be less than what was thought at the time,” says Robert Ineson, the managing director for North American natural gas at IHS Energy
Demand for the product is waning in most Asian markets that were largely responsible for bringing about the initial surge of demand. The five largest markets in Asia have seen decreased imports of LNG for four consecutive years, according to the International Energy Agency. [Colored & bold emphasis added.]
While oil markets will start re-balancing after a slump next year, an oversupply in natural gas won’t disappear until the end of the decade, the International Energy Agency said, slashing its gas demand outlook for a fourth straight year.
“Slower generation growth, rock-bottom coal prices and robust deployment of renewables constrain gas’s ability to grow faster in today’s low-price environment,” the IEA said.
Global gas prices will remain under pressure as “huge amount” of LNG export capacity is coming online just as demand slows, Fatih Birol, executive director at the IEA, said in Brussels at a conference hosted by Friends of Europe, which seeks to encourage discussion on a range of European issues.
U.S. demand growth will slow as the government supports solar and wind generation and the use of gas in electricity stagnates through 2021 after a 20 percent surge in 2015. [Colored & bold emphasis added.]
The global LNG market has been turned upside down. In less than two years, the LNG marketplace has switched from a seller's market to a buyer's market. LNG buyers have gained more leverage due to a glut of liquefaction capacity and stagnant demand; spot and short-term purchases are gaining market share against long-term contracts; and LNG buyers are demanding better pricing and flexibility clauses within their supply contracts.
At present, the US is constructing its first wave of LNG export terminals. This LNG buildout includes the construction of 10 liquefaction trains, with a total LNG output of nearly 45 MMtpy. This constitutes a total capital investment of more than $42 B by the end of 2019. These projects include:
• Sabine Pass LNG, Louisiana—four trains, 18 MMtpy of capacity
• Cameron LNG, Louisiana—three trains, 12 MMtpy of capacity
• Freeport LNG, Texas—two trains, 9 MMtpy of capacity
• Cove Point LNG, Maryland—one train, 5.75 MMtpy of capacity
A second wave of US LNG export projects could add 30 MMtpy. This capacity would include additional liquefaction trains at Sabine Pass and Freeport, and the startup of Cheniere's Corpus Christi, Texas LNG project. Outlier projects include the grassroots Jordan Cove and Oregon LNG terminals.
As the data for the US and Australia indicates, future LNG supplies will not be a problem; the problem is finding a home for that LNG. Even with robust demand growth, there will be a huge surplus of LNG supply through the early 2020s. [Colored & bold emphasis added.]
Meanwhile [Shell's] deferral of a plan to invest in Lake Charles liquefaction capacity in Louisiana reflects even more acutely the overhang: LNG Canada, the wrong side of the Rockies and miles from any gas reserves, was always going to be a harder project to bring to a final investment decision, so no surprises there; but the other, a brownfield development, is more worrying as it would have had to clear a much lower hurdle to satisfy the company’s rate of return demands. And as the company said at the press conference July 28, LNG projects that are functioning sooner will be better placed to take advantage of the hoped-for LNG demand pick-up later next decade.
Shell told NGW that the low gas prices in Europe may attract some small number of cargoes from the US, as a spot price could just about cover cash costs (Henry Hub + liquefaction margin + transport + regas), particularly if the supplier has a take or pay commitment on the LNG liquefaction or upstream supply, which Shell does, with Cheniere Energy, now that it owns BG.
“But US LNG suppliers or marketers would not enter into structural, multi cargo deals, and certainly not make any new investments, at current prices and without more certainty on gas demand development in Europe,” Shell's statement said.
2016 July 20
Kinder Morgan on Thursday said its units Elba Liquefaction and Southern LNG received approval from the Federal Energy Regulatory Commission for the Elba liquefaction and export project.
In its statement, Kinder Morgan informed its units have also received FERC certificates of public convenience and necessity for the EEC modification project and SNG Zone 3 expansion project, respectively.
Trinidad and Tobago’s sole LNG producing company, Atlantic LNG said production at its 14.8 mtpa Point Fortin facility is “suffering badly” from gas supply shortages in the country.
“Atlantic is suffering badly from gas supply shortages every day. The Atlantic plant is now at record low levels of utilisation and we are failing to deliver on our LNG commitments,” Atlantic’s CEO Nigel Darlow said in a statement.
The onshore Jamaica LNG terminal, known as the Old Harbour project, is expected to be completed by mid-2018, according to a statement by the Jamaican government on 1 June.
The island’s information service stated that a supply agreement has been finalised by developer New Fortress Energy and utility Jamaica Public Service.
Agreements have also been reached with Chinese engineering, procurement and construction (EPC) provider China Power, which is building the terminal.
In the short term, New Fortress Energy is providing a floating storage unit (FSU) to Montego Bay. The FSU, which is expected to be the 138,000cbm Golar Arctic, is expected to be installed by the end of the year. Anglo Dutch Shell was named by sources as one of the likely term suppliers for the Jamaica LNG supply, but this could not be immediately confirmed.
“I’m concerned the governor wishes to drive ahead a project that is marginal at best and uneconomic at worst,” [Senate Resources chair Cathy Giessel, R-Anchorage] said.
A confluence of depressed LNG and oil markets has challenged the current and more traditional equity financing structure, with each participant — the state, BP, ConocoPhillips and ExxonMobil — financing equal shares of the project that could cost upwards of $50 billion or more.
An oversupplied LNG market has chopped the near-term price of the commodity by more than two-thirds over the last two years, which eats into the potential profits of the Alaska LNG Project. And the project’s 800-mile pipeline from the Slope to Nikiski is a major cost that will always eat into its margins. It’s also a major cost most competing LNG projects worldwide don’t have to deal with.
Additionally, current oil prices are less than 50 percent of what they were when the current project structure was approved in 2014, which has hit all the producers’ bottom lines and on some level impaired their financial ability to make the requisite $10 billion-plus investment in the Alaska LNG Project, Meyer said.
ANCHORAGE, Alaska -- Big oil producers here are expressing serious doubts about moving forward with a multibillion-dollar liquefied natural gas export project in the state at a time when world energy markets are flooded with fuel and natural gas prices are half of what they were two years ago.
But that isn't stopping Alaska Gov. Bill Walker (I), who insists the state can commercialize the 34 trillion cubic feet of natural gas available on the North Slope even if one or more of its oil industry partners decides not to move forward with the proposed project.
"We need to recognize that under the current path, this project is not going forward," [Keith Meyer, the new head of the state's independent Alaska Gasline Development Corp.,] told state legislators at a recent joint hearing of the Alaska House and Senate resources committees.
"BP understands the state's fiscal need for a new revenue source in the mid-2020s," [BP senior manager Dave Van Tuyl] said. "But we don't want to rush into the largest energy project in North America that only ends up losing lots of money for all of us."
"You've seen a fundamental change in market conditions," state Sen. Peter Micciche (R) said. "And if the people that have the most experience on the planet are concerned about the viability of this project, I think we should share in that concern." [Colored & bold emphasis added.]
B.C.’s LNG export dream has hit a bump in the road after a major merger was quashed.
[T]he Hawaii Public Utilities Commission has decided not to allow the merger between Hawaiian Electric Companies and NextEra Energy, citing concerns about whether the merger is in the public interest.
The decision effectively kills the LNG export agreement with FortisBC. [Colored & bold emphasis added.]
Global Sustainability Research says 'gas glut' and alternative energies behind B.C. LNG delays
Another delayed liquefied natural gas plant in B.C. has some wondering if the whole industry is in trouble.
An analyst with Global Sustainability Research says the delays are partly due to a 'global glut' bringing down energy prices around the globe.
David Hughes says he believes market conditions won't be favourable for LNG in B.C. for at least five years, if ever.
"While the gas production in North America has gone up, production in the rest of the world has gone up even more," [LNG Canada CEO Andy Calitz] said. "So it looks like gas prices ... are going to remain low for the foreseeable future."
A downturn in the global energy market makes Canadian-produced LNG unprofitable in Asian markets while Hughes says there are further issues compounding Canada's sale of LNG to China as that country is investing in its own energy sources. [Colored & bold emphasis added.]
"The whole global energy industry is in turmoil," [LNG Canada CEO Andy Calitz] said.
[G]lobal oil and gas prices will have to recover before the companies involved can move forward, he added. [Colored & bold emphasis added.]
LNG Canada announced Monday it would delay indefinitely its decision to proceed beyond 2016. The group started engineering work in 2014, supported by Shell, Korea Gas, Mitsubishi of Japan and PetroChina as venture partners.
International gas consortium hits the brakes on B.C. final investment decision until markets improve, but a top Texas analyst is less optimistic for province.
LNG Canada — a partnership of Royal Dutch Shell, Korea Gas, Mitsubishi and PetroChina — made the announcement Monday, throwing more cold water onto the B.C. government’s hopes to complete such a deal before next year’s provincial election.
Even if oil and gas prices recover from their current collapse, “headwinds” include competing with Russian gas pipelines, the growth of renewable energy in China, and massive U.S. production.
It’s the “upfront capital expense” that puts B.C. in an unattractive light for investors, he argued, not just current prices. Only one scenario would see B.C. build one single project, he argued — if global demand suddenly accelerated “dramatically.” [Colored & bold emphasis added.]
Hawaiian Electric Industries (HEI), parent company of the state's dominant electric utility Hawaiian Electric Co., announced Tuesday that it is not for sale following regulatory rejection of its acquisition by Florida-based NextEra Energy.
In the wake of the NextEra merger rejection, HEI also withdrew an application to import liquefied natural gas from Canada — a major component of its power supply plan now under review by the Public Utilities Commission.
A company statement said HEI remains "committed to transitioning to 100% renewable energy in the most cost-effective way possible while ensuring reliable service," but it is unclear how the withdrawal will affect regulatory review of the PSIP. [Colored & bold emphasis added.]
Citibank analysts predict that with the current glut of LNG in the global market and resulting low prices, U.S. LNG supplies will not be shipped to Asia anytime soon even with the widened Panama Canal. The widened canal can now accommodate larger ships carrying LNG. “The Panama Canal expansion, inaugurated on June 26, was once expected to be a game changer for U.S. LNG exports to Asia… [b]ut against the backdrop of this major transition in the global LNG market, the prospects for U.S. LNG into Asia via the expanded canal look less promising, at least in the short-term.” The report projects that U.S. LNG will stay in the Western Hemisphere for the near future since it will not be profitable to ship the supplies all the way to Asia. [Colored & bold emphasis added.]
2016 July 16
Bear Head LNG Corporation Inc. (Bear Head LNG) received Nova Scotia Environment’s (NSE) approval for its Greenhouse Gas (GHG) Management Plan for its liquefied natural gas (LNG) facility on the Strait of Canso in Richmond County, Nova Scotia.
Webmaster's comment: This LNG export terminal project would require natural gas from western Canada or eastern US; otherwise, there would not be enough natural gas in Nova Scotia to export.
Province's 3 municipal organizations will formally vote on Saint John city council's proposal
Saint John is unlikely to encounter any opposition to its complex plan to unwind a multi-million dollar tax deal on Irving Oil's LNG property from other New Brunswick communities, according to representatives of three major municipal organizations.
Saint John city council voted last December to ask the province to repeal legislation that freezes municipal property taxes on the LNG property at $500,000 per year until 2031, well below the $8.02 million it would owe otherwise.
The province's worry is that its own assessment on the LNG property, which it values at $299.5 million, might be grossly overvalued.
That could result in the assessment being significantly cut in the face of an aggressive appeal by Irving Oil after the tax deal is dissolved and the province wants Saint John to pay for refunds Irving Oil might win.
Last week the province said it would adopt Saint John's complex proposal, but only after seeing if other municipalities agreed, since their new equalization money would also go into the trust fund and be held back until any property tax appeal launched by Irving Oil is resolved.
"Because your proposal contemplates holding back funds payable to all municipal equalization recipients for a number of years we believe before proceeding we should consult the three municipal associations," wrote Liberal cabinet ministers Rick Doucet and Ed Doherty in a letter to Saint John mayor Don Darling last week.
Up to 72 communities will receive some money if the LNG tax concession is repealed.
Saint John moved to end the tax deal following a series of reports by CBC News last year showing Irving Oil has been collecting $12.25 million US per year in rent on the property the LNG development sits on. The deal took effect in 2006 and was supposed to last until 2031.
ACUSHNET – About 50 area residents opposed to a major expansion of an LNG facility on Peckham Road took to the streets Saturday morning for a protest march designed to draw attention to what they say are the many drawbacks to the plan.
Organized by the grassroots opposition group South Coast Neighbors United, the three-mile march started at the Pulaski Elementary School in New Bedford and ended at the Ford Middle School in Acushnet. There was a brief stop for some speech-making at the Peckham Road site where Eversource Energy is proposing a pair of LNG storage tanks with a combined capacity of 6.8 billion cubic feet – or about 86 million gallons –on about 210 acres.
The Northeast Access Project is being planned by Eversource Energy and its partners. Algonquin Gas and Spectra Energy have proposed a 1.7 mile transmission pipeline running from an existing East Freetown pipeline to the Peckham Road site. The finalized plans for the project are scheduled to be submitted to the Federal Energy Regulatory Commission (FERC) in November.
“To date, Algonguin [Gas Transmission LLC] has been evaluating a site in Acushnet, MA for the LNG storage facility. ... Based on a very preliminary review, an alternative site in your community is under consideration as possibly constituting a viable alternative location,” John P. Sheridan, Spectra director of state governmental affairs, wrote last week.
Brown said he divulged general information at the board’s meeting because, as Sheridan spelled out, Algonguin expects to submit draft resource reports on its proposed expansion of its natural gas pipeline system to the Federal Energy Regulatory Commission on or about July 22. It will include reports of “alternative pipeline alignments ... (and) the Somerset site will be discussed.”
Referring to the highly disputed and unsuccessful effort by Hess LNG to transport liquified natural gas to Weaver’s Cove in Fall River several years ago, Brown said he testified against that project as town manager in East Providence, Rhode Island.
Brown said his understanding is regional utilities National Grid and Eversource are also investing in what is being called the “Access Northeast Project” to construct and expand existing facilities and natural gas capacity. [Colored & bold emphasis added.]
Webmaster's comment: This project is related to the Access Northeast pipeline that would send more natural gas through Maine to Nova Scotia.
Anton van Walraven of Concerned Citizens Bowen came prepared with documents outlining LNG environmental concerns that he shared with Goldsmith-Jones at the community roundtable.
The Pembina Institute took aim at Woodfibre LNG in its latest release and the company is none to pleased about it.
According to the Pembina Institute’s graphic, 24 extra wells would need to be drilled per year to support the facility. It would contribute 0.81 million tonnes of carbon pollution per year and use a half million cubic metres of freshwater per year. The figures are based on the $1.6-billion Woodfibre LNG facility having a capacity of 2.1 million tonnes of LNG per year once it comes online in 2020, according to the Institute. [Colored & bold emphasis added.]
In a recent post in The Squamish Chief, Woodfibre LNG’s VP Byng Giraud said he must “cut costs to make the business profitable.” The company website states that safety will come about through “Use of appropriate materials and compliance with industry and safety best practices” and “Proper engineering design of all onshore and floating facilities.”
Many wondered what the tradeoffs would be between safety and cost. Influential shipping magazine TradeWinds is reporting that Woodfibre plans “to use two elderly LNG carriers as floating storage units (FSUs)…. Two LNG carriers, the 126,300 m3 LNG Capricorn (built 1978) and LNG Taurus (built 1979), which were purchased by Singapore-based Nova Shipping & Logistics last year, have been widely rumoured to be earmarked for conversion into FSUs for the Woodfibre project. Both ships are currently laid up in Southeast Asia.”
These ships are old! Almost 40 years old, they are among the oldest 5 per cent of the world’s 400-plus LNG carriers and 3.5 times older than the fleet’s average age. In human terms, these ships are nearing 150 years old. If installed for the 25-year life of the plant, by 2045 they would be by far the oldest active LNG vessels ever.
LNG carriers have a 20-year design lifetime which factors the stress, metal fatigue and tank damage these ships endure from pounding waves (100 million of them over 20 years), sloshing cargoes, electrolytic thinning of the hull’s steel and rusting of key pumps and valves essential to keeping the vessel operating safely. If a spill were to happen – an accident or a terrorist attack on these “sitting ducks” – these tankers have no secondary containment. Like Chernobyl’s reactors and Lac-Mégantic rail cars.
Both vessels have had accidents. The LNG Taurus suffered severe hull damage in a grounding in Japan in 1980, while the LNG Capricorn had a fire in its #5 tank and hard-whacked a pier while docking. Taurus’s captain so feared the catastrophic rupture of the ship’s LNG tanks that he took his own life on the spot. His ghost is rumoured to haunt the Taurus!
Given this approach to cost reduction, it is cold comfort to contemplate the words of Woodfibre LNG’s Vice-President Byng Giraud – then (2013) VP of Imperial Metals’ Mount Polley Mine – who said, “There needs to be a public realization that the costs imposed on industry to remove extreme risks reducing a risk from one in 1,000 to one in 10,000 – comes with a price.” Indeed it does, as victims of disasters in Mount Polley, Lac-Mégantic, Halifax, Westray and Grassy Narrows can attest. [Colored & bold emphasis added.]
The Fort Nelson First Nation is reaffirming their support for acquiring liquefied natural gas development in their territory.
[Peace River North MLA Pat Pimm] says having the support of the Fort Nelson First Nations is helpful but it is difficult to say if they’re support will quicken the LNG movement.
VANCOUVER — Premier Christy Clark's dreams of a booming liquefied natural gas industry in British Columbia have been dealt another blow after a Shell-backed venture delayed a final investment decision indefinitely.
LNG Canada's decision to put the project in Kitimat on hold amid weak global prices isn't surprising, but it adds to the pessimistic mood around the future of the sector in B.C., experts say.
"It just creates a dark cloud over what is already a bunch of dark clouds for that type of economic activity," said Martin King, vice-president of institutional research at FirstEnergy Capital Corp.
In the last agenda-setting throne speech from the westernmost Canadian province in February, B.C. warned against the pitfalls of relying too much on natural resources for economic growth. The words were a direct shot at neighbouring Alberta, which still derives more than 25 per cent of its gross domestic product from the energy sector.
“It has never been more important to stay vigilant,” B.C. Lieutenant-Governor Judith Guichon said in the Feb. 9 address. “Over the decades, Alberta lost its focus. They expected their resource boom never to end.”
Yet as hopes for a vibrant west coast LNG export sector being up and running by the end of this decade dwindle, B.C. finds itself in a very similar position to Alberta.
LNG Canada, a $40-billion proposal backed by Royal Dutch Shell and PetroChina to export LNG from the coastal town of Kitimat, delayed a final investment decision this week on the project for the second time this year. While CEO Andy Calitz stressed in a conference call with reporters on Monday the project was being delayed and not cancelled, he refused to provide a new timeline for when the decision can be expected.
Of more than two dozen projects which have been proposed to export LNG from B.C., only LNG Canada had all the necessary regulatory approvals in hand to move forward. Global economic factors – the spread between Asian and North American natural gas prices has been cut in half over the past two years and there is already enough new LNG export capacity under construction around the world to grow supplies by 58 per cent over five years – were cited as the main reason for the latest delay. [Colored & bold emphasis added.]
LNG Canada's decision to indefinitely delay investment in a proposed liquefied natural gas project in northern B.C. has local leaders worried about the region's economic future.
The multinational consortium cited low global energy prices as the reason for the latest delay in the project slated for construction in Kitimat.
[Kitimat Mayor Phil Germuth] said the "domino effect" as various LNG facilities were repeatedly delayed gave local businesses a sense the indefinite Kitimat delay was coming, and they were careful not to overextend themselves.
2016 July 2
Last week’s news that the Bear Head LNG export project has received Canadian government approval for a licence to import natural gas from the US, then export LNG from its proposed Nova Scotia terminal for 25 years did not register on the Richter scale.
The scheme still has many obstacles to overcome before it can come to fruition, and several look insurmountable in the current business environment.
Bear Head, near Point Tupper on the Strait of Canso 200km north of Halifax, was conceived in 2003, when US gas reserves appeared to be dwindling and plans for massive LNG imports were unveiled.
With the same US market and logistics in mind, Irving Oil and Repsol simultaneously began to build the Canaport LNG import terminal near St John in the neighbouring Canadian province of New Brunswick.
However, Canaport went ahead, but Bear Head did not. In summer 2006 Anadarko, unable to line up an LNG supplier, got cold feet and put the project on hold. When methods to exploit the vast shale gas resources of the US were implemented shortly afterwards, the raison d'être for Bear Head as conceived was undermined and Anadarko mothballed the project.
Reversing the earlier plans for Bear Head LNG Ltd is seeking to pump gas from the Marcellus shale region in the northeastern US northbound through the M&NP [Maritimes & Northeast Pipeline] system.
…Bear Head is among myriad proposed North American LNG-export projects tabled prior to the global drop in demand for gas. Today’s rock-bottom gas prices are deterring investment in new projects as gas buyers are reluctant to commit to long-term purchases.
Irving Oil and Repsol had considered giving the neighbouring Canaport receiving terminal a bidirectional capability by adding liquefaction trains but shelved the plan in March after investors failed to support the US$2-4 billion scheme.
The Bear Head scheme also requires supplies of US pipeline gas to be viable. Although there is plentiful gas in the northeast US Marcellus and Utica shale plays, the existing New England gas pipeline system that links with the M&NP network cannot cope with peak winter demand loads, let alone the feedstock requirements of mooted Canadian east coast LNG export projects such as Bear Head, Canaport and Goldboro LNG. [Colored & bold emphasis added.]
FERC has issued an order authorizing Gulf South Pipeline Company, LP (Gulf South) to construct and operate the Coastal Bend Header Project pipeline facilities which will provide 1.42 Bcf/day of firm gas transportation service to Freeport LNG Development, LP’s liquefaction and LNG export terminal under construction on Quintana Island in Brazoria County, Texas. BP Energy Company, Chubu US Gas Trading LLC, Osaka Gas Trading & Export LLC, and E.ON Global Commodities North America LLC have signed precedent agreements for all of the firm transportation capacity from the Coastal Bend Header Project.
The Walker administration on Thursday continued to fight Alaska's major oil producers for details about how they will sell their Prudhoe Bay natural gas, refusing to approve an annual activity plan at one of the nation's largest oil fields until it gets the information it wants.
The proposed 2016 plan received by the state in April meets the requirements for oil development, but the producers have a duty under their leases and state law to provide a complete development plan for "all resources" — natural gas as well as oil, said the letter to BP, the unit operator, on Thursday.
"Given the current status of the field, it is now time to take measurable, verifiable steps towards (a major gas sale) and DNR is entitled to know what those plans and steps are and will be," said the letter, signed by Corri Feige, director of the Oil and Gas Division.
But as Gov. Bill Walker pushes hard for a state gas line project to sell huge volumes of that gas to Asian utilities, the department took the unusual step this year of demanding answers about the companies' plans to market and sell the gas.
BP has called the demand for information illegal and unprecedented.
The (producers) cite "the lack of a pipeline to justify not achieving a major gas sale while simultaneously not taking firm strides toward making gas available for a third-party project," said [Corri Feige, director of the Oil and Gas Division].
Alaska LNG export project filed its second draft resource report with the U.S. Federal Energy Regulatory Commission noting the project is targeted to start up in 2025.
The multi-billion dollar project is being developed by the state-owned Alaska Gasline Development Corporation and energy giants BP, ConocoPhillips and ExxonMobil.
The facility to be constructed on the eastern shore of Cook Inlet on the Kenai Peninsula will be able to produce 20 mtpa of LNG from three liquefaction trains.
[T]he project includes an 804-mile gas pipeline, a gas treatment plant, a 62-mile gas transmission line connecting the GTP to the Point Thomson unit and a 1-mile gas transmission line connecting the GTP to the Prudhoe Bay unit gas production facility.
The cost of the project is still estimated at $45 to $65 billion.
The International Energy Agency (IEA) is expecting further delay of Pacific NorthWest LNG—one of several bleak pieces of news in the agency’s latest forecast of the natural gas market.
The report is a sobering one for B.C.’s nascent liquefied natural gas industry, which has yet to see a positive final investment decision on any of the 20 proposed projects on the province’s coast.
"…the IEA expects U.S. gas-fired generation to stagnate, with risks skewed to the downside.” [Colored & bold emphasis added.]
The Oregon Department of State Lands has until Nov. 10 to decide about a permit for the excavation of 6.3 million cubic yards from our wetlands and waterways so an out-of-state corporation can export U.S. fracked liquefied natural gas to Asia. The project would build a pipeline through 232 miles of southern Oregon’s mountains, forests, and nearly 400 waterways. It also would create a massive export terminal at Coos Bay, requiring extensive dredging that would harm local fisheries and oyster businesses.
The Department of State Lands (DSL) is overseen by the three top elected officials in Oregon. Under Oregon’s Constitution, this board’s mission is to manage our lands “with the object of obtaining the greatest benefit for the people of this state, consistent with the conservation of this resource under sound techniques of land management.”
The Jordan Cove export terminal and Pacific Connector pipeline do not meet that standard. Even the Federal Energy Regulatory Commission, which normally rubber-stamps projects like this, denied federal permits in March, ruling that “the proposed Jordan Cove LNG terminal can provide no benefit to the public to counterbalance any of the impacts which would be associated with its construction.” FERC also found that “the record does not support a finding that the public benefits of the Pacific Connector Pipeline outweigh the adverse effects on landowners.”
Nonetheless, Williams Partners, the pipeline company, is appealing FERC’s decision and continuing to pursue required state permits.
In February, May and now June, the company has asked for an extension of time from the DSL because it has been unable to demonstrate that the project would meet state laws protecting waterways and wetlands. As the deadline continues to be pushed down the line, Williams still has not provided that information, and by law its permit application ought to be denied. [Colored & bold emphasis added.]
After a 12-year fight to keep a $6 billion liquified natural gas (LNG) pipeline project out of Washington and Clatsop counties, local activists are holding a Victory Party from 5:30 to 8:30 p.m. Friday, July 1, at Montinore Estate, 3663 S.W. Dilley Road, south of Forest Grove.
Oregon LNG had initially proposed installing a pipeline that would have stretched from a terminal in Warrenton on the Columbia River near Astoria down to Mollalla, passing through parts of western Washington County such as Timber, Gales Creek and Forest Grove — including Montinore. Based partly on pipeline problems with other projects, many local residents believed OLNG’s pipeline construction would threaten their homes or the environment.
That pipeline project collapsed in 2012, leading Oregon LNG to propose a different pipeline route that bypassed Washington County. But by that time, “Oregon LNG created such ill will, people who did not have a personal economic issue have very visceral personal feelings about this company,” said Susan Vosburg, a homeowner who would have been affected by the original proposal.
[O]n April 15, 2016, Oregon LNG released a terse statement: “The Oregon LNG Project today announced it is ceasing operations immediately. The owner of the project, Leucadia National Corporation (NSYE:LUK), has made the decision to cease funding the project. Oregon LNG thanks all those in the project area who supported its 12-year effort to bring good jobs and tax revenues to Warrenton and Clatsop County by building a liquefied natural gas (LNG) terminal and associated pipeline. Oregon LNG will have no further comment.”
Friday’s Victory Party will double as a fundraiser for Columbia Riverkeeper, a nonprofit which helped lead the fight against Oregon LNG. In addition to a suggested donation of $10 to $15 for Columbia Riverkeeper, the event will feature stories from the OLNG trenches, wine tasting, music and a potluck dinner (bring your own potluck offering, plus your own tableware and utensils, as well as a folding chair or blanket to sit on). [Colored & bold emphasis added.]
British Columbians need to have a say on the provincial government’s commitment to link the province’s economic future to a very large bet on LNG. The total number of plants currently proposed for BC approach in volume the entire current global capacity. Yet, any review of the global industry reveals declining demand. When examined for its greenhouse gas implications, the LNG bet is a bet against making our targets and avoiding catastrophic climate change. The natural gas in the BC industry is not conventional; it is fracked. And fracked natural gas has the same carbon impact as coal.
It is instructive to review the rules and regulations surrounding the LNG industry in the US and compare them to those in Canada. Whether one is for or against Premier Christy Clark’s commitment to tie the economic future of BC to the LNG industry, at a minimum, British Columbians would assume that the industry will be stringently regulated for the safety of all our citizens. But the more I dig into it, the more Canadian regulation of LNG reminds me of the way Transport Canada regulated the railcars perched on the hillside above Lac Megantic, Quebec. It did not violate any Transport Canada regulation that highly dangerous Bakken crude was left unattended without the brakes on, in an antiquated rail car on a train track on the hill above the town. We know that the railcars rolled down hill creating a fireball that destroyed the centre of the Lac Megantic, killing 47 people. Following that disaster, Transport Canada began tightening up the rules. [Colored & bold emphasis added.]
The D.C. Circuit Court of Appeals ruled this week that the Federal Energy Regulatory Commission is not required to examine the upstream impacts of natural gas development when reviewing the environmental impacts of new liquefied natural gas export facilities under the National Environmental Policy Act. Instead, the court said that if any agency should examine upstream impacts, it would be the Department of Energy, which has to approve LNG exports. The case involved two LNG terminals on the Gulf Coast, one in Sabine Pass, Louisiana and the other in Freeport, Texas. The D.C. Circuit is also reviewing challenges to Maryland’s Cove Point LNG terminal but has not yet ruled in that case.
“Those decisions are disappointing and reflect a fundamental misunderstanding of the way NEPA is supposed to work,” [Earthjustice attorney Moneen Nasmith] told StateImpact. “What that ultimately means for getting the analysis of Cove Point that we’ve been asking for remains to be seen.” [Colored & bold emphasis added.]
Webmaster's comment: FERC is an independent agency within the US Department of Energy. Both are obligated to determine a project's public interest when making permitting decisions.
The newly expanded Panama Canal that opened its locks earlier this week will be able to accommodate 90 percent of the world’s current LNG tankers with up to 3.9 billion cubic feet carrying capacity.
The new locks, that enable wider vessels, 180 feet across, to transit the canal, will have “significant implications for LNG trade, reducing travel time and transportation costs for LNG shipments from the U.S. Gulf Coast to key markets in Asia and providing additional access to previously regionalized LNG markets.”
The voyage to Japan has been cut to 20 days from 34 days it took to travel around the southern tip of Africa or 31 days if transiting through the Suez Canal, EIA said.
Exports from the U.S. U.S. Gulf Coast to South America will also be shortened from 20 days to 8-9 days to Chilean regasification terminals, and from 25 days to 5 days to prospective terminals in Colombia and Ecuador.
Currently, about 9.2 billion cubic feet per day of U.S. natural gas liquefaction capacity is either in operation or under construction in the United States.
EIA adds that by 2020, the United States is set to become the world’s third-largest LNG producer, after Australia and Qatar. More than 4.0 bcf/d of U.S. liquefaction capacity has long-term (20 years) contracts with markets in Asia, of which 3.2 bcf/d is contracted to Japan, South Korea, and Indonesia. [Colored & bold emphasis added.]
U.S. Rep. Bonnie Watson Coleman, D-N.J., on Wednesday said she’d be introducing a bill to toughen the criteria the Federal Energy Regulatory Commission must use when reviewing proposed pipeline applications and certifying that the pipeline is both convenient for and needed by the public. [Colored & bold emphasis added.]
Webmaster's comment: FERC panders to the energy industry while claiming public objections and protests "are out of control." The leash on FERC does not need to be tighter — it needs to be actual.
Environmental groups led by Earthjustice and the Sierra Club on Monday asked the Tenth Circuit to revive a federal rule regulating fracking on federal and Native American lands.
The U.S. Department of Energy’s Office of Fossil Energy has released LNG import and export data for 2016 through April. The data show that in April three commissioning cargoes of domestically produced LNG were exported from the Sabine Pass Liquefaction terminal in Cameron Parish, La.: two cargoes totaling 6,310,025 Mcf were sent to Argentina at export point prices ranging from $3.85 to $4.10/MMBtu, and one cargo of 3,700,091 Mcf was sent to Portugal at an export point price of $3.41/MMBtu. The data also show that American LNG Marketing, LLC exported 2,972 Mcf of domestically produced LNG in ISO containers from Miami, Fla. to Barbados at an export point price of $10.00/MMBtu.