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Passamaquoddy Bay & LNG

Maine

Should Maine be in the natural gas business? [Opinion] — Bangor Daily News, Bangor, ME

Pipeline construction underway

While the market for pipeline capacity in New England is limited, privately funded expansion plans for some of the region’s primary pipelines are in the works.

Spectra Energy expects to complete an expansion of its Algonquin Gas Transmission pipeline by 2016 that will add 500 million cubic feet of transmission capacity per day; the pipeline’s capacity is currently 2.44 billion cubic feet per day. The Algonquin Incremental Market project will largely expand the capacity of the existing Algonquin pipeline, which runs more than 1,100 miles between New Jersey and Massachusetts.

Another New England pipeline, the Portland Natural Gas Transmission System, is also planning a pipeline expansion and is seeking capacity investors. So is the Tennessee Gas Pipeline, another of the region’s transmission routes, according to the Northeast Gas Association.

ISO New England is also looking to change the way it pays for electricity so it can provide incentives to gas-fired power generators to buy pipeline capacity and spur more pipeline construction. The organization is considering a model under which it rewards power generators for supplying power during high-demand periods. [Red & bold emphasis added.]

Webmaster's comment: Downeast LNG has told the public that pipeline expansions are nearly impossible. Ooops!

United States

Americans still opposed to natural gas exports (May 30) — Knovel

A new survey from America's Energy Advantage suggests that residents in the country are largely opposed to opening up the U.S. to natural gas exports, regardless of the oft-touted economic benefits.

NPR notes that many environmentalists have fought against the idea of exporting LNG on the grounds that it would help to encourage the use of fracking and increased natural gas production rather than the development of alternative sources.

But others who actually make use of natural gas have been similarly opposed to the idea, from the manufacturers that have suddenly found themselves with an uncommon advantage over foreign companies to homeowners who have seen heating and electricity costs drop dramatically.

On the whole, 65 percent opposed natural gas exports, and many people - 48 percent - felt like the higher profits for energy companies only made them less likely to support the idea.

Maine

Maine Omnibus Energy Bill cleared by committee (May 24) — Natural Resources Council of Maine, ME

The bill aims to support expanding natural-gas pipelines and fund energy-efficiency efforts.

The so-called Omnibus Energy Bill, which incorporates ideas from at least nine separate bills, would encourage the expansion of natural-gas pipelines into New England, increase funding for energy-efficiency efforts and provide financial assistance to help low-income families switch to more affordable heating systems.

The bill authorizes the PUC [Public Utilities Commission] to enter into contracts for new gas line transmission capacity into New England. [Red & bold emphasis added.]

Webmaster's comment: Downeast LNG's Dean Girdis must again be screaming out loud about how hard it is to do business in Maine — especially with his unneeded, white elephant business idea.

LePage withholding support for Energy Bill, wants wind rules changed (May 23) — Natural Resources Council of Maine, ME

AUGUSTA, Maine — Gov. Paul LePage is withholding support for a compromise bill being worked out by the Legislature’s Energy Committee that’s aimed at expanding Maine’s natural gas infrastructure, boosting funding for energy efficiency, directly lowering businesses’ electricity costs and making it more affordable for residents to abandon oil heat.

United States

The unintended consequences of exporting natural gas (May 27) — Time

...For some time, gas companies have been pushing the federal government to make it easier to export natural gas in liquefied form to foreign countries. This is itself a huge turnaround. Less than a decade ago, domestic production of natural gas was so low that facilities were being built in U.S. ports to import foreign natural gas. The shale-gas revolution, made possible by fracking, changed all that. Now the U.S. literally has more natural gas than it knows what to do with, and the price of gas has tumbled to around $4 per million BTU.

...But the glut of gas — and natural gas, unlike oil, can’t easily be stored — hasn’t been so great for one sector: natural gas companies themselves, which have begun complaining that drilling is costing them more than they can make selling their product.

So the news on May 17 that the Department of Energy (DOE) had given a terminal near Freeport, La. — one originally built to import gas — permission to export LNG was met with approval by natural gas companies, even as chemical companies worried about the effect on prices and environmentalists worried that more exports would mean more fracking. In a statement after DOE approved the export terminal, Deb Nardone of the Sierra Club’s Beyond Natural Gas campaign said:

"Exporting LNG will lead to more drilling — and more drilling means more fracking, more air and water pollution, and more climate fueled weather disasters like last year’s record fires, droughts and superstorms. In today’s conditional authorization, DOE acknowledges that it has not yet considered any of these impacts, but that environmental effects must be considered before DOE can grant final approval."

[Red & bold emphasis added.]

Webmaster's comment: Exporting will also deplete the finite resource at a faster rate, meaning, the US will run out of natural gas sooner. How is that good for US energy security?

Maine

Is natural gas Maine's energy future? (May 26) — Morning Sentinel, Skowhegan, ME

[I]n the past five years, the market changed in unpredictable ways. The gas deposits off Nova Scotia fell short of expectations. Another deposit off Newfoundland has taken longer than planned to bring online. New drilling technologies made it possible to extract a plentiful supply of gas from deposits in Pennsylvania and New York, essentially on New England's doorstep. Those deposits, in the Marcellus and Utica fields, are so large that they have helped trigger a gas glut that collapsed prices and, as a side note, killed the economics of importing LNG.

For these and other reasons, gas shouldn't be considered "a silver bullet," in the view of Beth Nagusky, Maine office director of Environment Northeast. It may be a cleaner-burning fuel, she said, but gas has impacts that are being largely downplayed by its supporters, including hydraulic fracturing that can pollute ground water, and methane emissions that speed up climate change.

"There's a concern about becoming overly dependent on another fossil fuel, when we really should be getting off fossil fuels," Nagusky said. "Being overly dependent on natural gas is not the answer."

That's why two proposed expansions of existing pipelines are welcomed in New England. One involves the Portland Natural Gas Transmission System, or PNGTS, which connects lines in western Canada with the Maritimes line in Westbrook. PNGTS currently is seeking bids for new volumes of gas, with the aim of nearly doubling the capacity of its line, from 168,000 dekatherm per day to 300,000 in three years. One dekatherm equals roughly 7 gallons of heating oil, so 300,000 dekatherm is the equivalent of 2.2 million gallons a day.

PNGTS offers the possibility of moving gas from Pennsylvania and New York over a line that runs through New York state into Ontario, bypassing the congestion in southern New England. But the expansion is dependent on a similar bidding process under way on the TransCanada Pipeline.

Also pending is an upgrade to the Algonquin Gas Pipeline, which runs 1,120 miles through New Jersey to Beverly, Mass., where it meets the Maritimes line. The Algonquin Incremental Market project will expand capacity up to 542,000 deckatherm per day in 2016, to serve local gas companies and power plants in New England.

Algonquin is owned by Spectra Energy Transmission, which is the lead owner of the Maritimes line. It is possible that the Maritimes line, which now pumps gas south through Maine, could be reversed to send plentiful Marcellus and Utica gas north for customers in Maine and eastern Canada. [Red, yellow & bold emphasis added.]

Webmaster's comment: Pipeline expansion is 'impossible' according to Downeast LNG's Dean Girdis. Downeast LNG is flogging a skeleton.

Canada >>> Save Passamaquoddy Bay researcher's strategy holds fast in Ottawa <<<

BREAKING NEWS: Canada continues to oppose LNG development in Passamaquoddy Bay (May 17) — The Bay of Fundy Explorer, NB

Canada’s Ambassador to the United States confirmed again today Canada’s official opposition to the proposed Downeast LNG terminal in Passamaquoddy Bay, Bay of Fundy, stating:

"Given that LNG vessels would need to transit through Head Harbour Passage as well as the New Brunswick side of Passamaquoddy Bay. our position remains that this proposal can not proceed. Canada will not cooperate in any coordination planning with U.S. authorities: nor will our Government curtail the use of Head Harbour Passage and Passamaquoddy Bay in order to accommodate the incursion of LNG tankers."

Canadian Government continues opposition to Downeast LNG import terminal (May 20) — LNG Law Blog

Canadian Ambassador Gary Doer filed a letter at FERC on Friday reiterating the Canadian government's opposition to the proposed Downeast LNG import terminal on the Maine side of Passamaquoddy Bay. Doer stated that the Canadian government's position is that since LNG tankers serving the terminal would have to pass through Canadian waters, the proposal cannot proceed and the Canadian government will not cooperate on coordination planning with U.S. authorities or curtail use of the waterways to accommodate LNG tankers. [Red, yellow & bold emphasis added.]

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• Save Passamaquoddy Bay 3-Nation Alliance's researcher and webmaster developed the no-cooperation strategy in November of 2006 that was quickly and successfully adopted by the Town of St. Andrews, Province of New Brunswick, and Government of Canada.

Nova Scotia

India's H-Energy explores potential Canada LNG export terminal (May 10) — Reuters India

India-based H-Energy has signed an option agreement with the Canadian province of Nova Scotia, to look at putting up an natural gas liquefaction facility and export terminal in the province, a director of the company, said on Thursday.

Second LNG project proposed (May 10) — The Chronicle Herald, Halifax, NS

Indian firm has option for land to build plant, terminal in Guysborough County

Indian company H-Energy has an option to acquire 240 hectares of land from the province for a possible LNG plant and export terminal along the Strait of Canso.

The developer of a similar venture further east in Guysborough County said he’s not familiar with the Indian company or its plans.

One-third of the Goldboro facility’s supply will come from shale gas projects in New Brunswick and officials are also exploring options in offshore Nova Scotia and the northeastern United States. [Red & bold emphasis added.]

Northeast

Do rig counts tell us much about oil and natural gas supplies anymore? (Apr 5) — Platts

Consider the facts: Lower-48 gas production averaged at 72.1 Bcf/d in January, close to all-time highs, according to the US Energy Information Administration. Gas rigs, meanwhile, were at 14-year lows, averaging at 434 for the same month.

Drilling times per well have about halved compared to two years ago. The fastest time an Eagle Ford well has been drilled, as per an operator there, is three days. Three days.

In Pennsylvania, more than 1,000 wells have been drilled, but are waiting to be completed because the necessary takeaway capacity isn’t ready. Some producers have reduced their gas rig counts in the state to a grand total of one and still see their overall production levels grow year-over-year, a stark indicator of how prolific some of those wells are. [Red & bold emphasis added.]

Passamaquoddy Bay

[See article under the United States heading, below.]

New Brunswick

Canadian LNG bolsters Repsol profit in one-off winter boost — (Dow Jones Newswires) Fox Business

Repsol reported earnings Thursday that beat analysts' estimates. Company officials made clear, however, that they expected the exceedingly bright spot in Canadian LNG operations to remain a one-time event in the foreseeable future.

A year ago, the Canadian terminal was operating at a loss, said Chief Financial Officer Miguel Martinez.

In fact, Repsol is instituting plans to limit operations at the plant so it runs no more than four months a year, he said. [Red, yellow & bold emphasis added.]

Webmaster's comment: Perhaps Downeast LNG could rent Canaport LNG for eight months of the year.

Northeast

Environmental groups say Cove Point LNG export terminal would hurt ecology (May 7) — LNG World News

A coalition of local, regional, and national groups are objecting to the environmental impacts posed by the proposed Dominion Cove Point liquefied natural gas (LNG) export terminal on the Chesapeake Bay, saying the project would hurt the Bay’s economy and ecology, increase air pollution, and hasten fracking and drilling in neighboring states.

The groups—Sierra Club, Earthjustice, Patuxent Riverkeeper, Potomac Riverkeeper, Shenandoah Riverkeeper, Lower Susquehanna Riverkeeper—filed public comments and a motion to intervene in the proceedings late Friday to the Federal Energy Regulatory Commission (FERC) calling on the agency to conduct a thorough environmental review, or prepare an Environmental Impact Statement, of the project.

Dominion Cove Point LNG Certificate application raises protests from shippers and environmental groups (May 7) — LNG Law Blog

Shell NA LNG LLC (Shell) and BP Energy Company (BP) filed protests against Dominion Cove Point LNG's (Cove Point) FERC application to construct LNG liquefaction and export facilities at its existing LNG import terminal in Lusby, Md. Shell alleges that Cove Point has not demonstrated (1) that the proposed export project will not degrade the services that Shell currently takes from Cove Point, and (2) that existing customers will not subsidize the costs of the export project. BP alleges unduly preferential conduct stating that Cove Point provided its existing customer Statoil Natural Gas LLC with a unique opportunity to turn back its import capacity, while BP was not offered such an opportunity. BP also protested Cove Point's proposed tariff revisions and requested that FERC require Cove Point to resubmit the tariff proposal after FERC has cured BP’s discrimination allegation.

Hawaii

Regulators approve Hawaii Gas request to withdraw LNG application (May 8) — Pacific Business News

State regulators have approved Hawaii Gas’ request to withdraw its application to use liquefied natural gas in its utility gas system to allow both the Honolulu-based firm and the Hawaii Public Utilities Commission to focus their efforts on the review of feedstock supply agreements.

But Hawaii Gas said previously that it expects to submit a new LNG application when longer supply agreements are in place.

Webmaster's comment: This is the LNG import terminal project that FERC says is not an LNG terminal project.

United States

LNG plants on barges a solution for shale (May 6) — FuelFix

With so much cheap natural gas in the United States, some companies are looking for ways to siphon the resource out of pipelines and onto barges.

Those barges, speakers said, could be a cheap and versatile way to liquefy natural gas so that it can be easily shipped overseas.

Webmaster's comment:Could this be what Downeast LNG is thinking about doing?

British Columbia

New LNG proposals avoid tanker transit in sheltered B.C. coastal waters (Apr 11) — The Vancouver Sun, Vancouver, BC

The Coast Tsimshian village of Lax Kw’alaams north of Prince Rupert could be poised to become a liquefied natural gas centre with significant advantages over Prince Rupert and Kitimat after the province announced Wednesday it has received four new LNG proposals.

“It’s a straight shot from Grassy Point out to the open ocean and then to Asia. It’s not in restrictive water courses. The faster the ships can get out of the territory and into the international waters of the open ocean, the less chance there is for significant issues arising,” Drury said. “Also, we believe there are some better options for pipeline routing by coming to Grassy Point.” [Red & bold emphasis added.]

Webmaster's comment: This points out another competitive disadvantage to Downeast LNG's unfortunate siting: it would take longer and cost more for LNG ships to arrive and depart — if they even had an ability to defy Canada's prohibition of LNG transits into Passamaquoddy Bay — not to mention the added risk.

United States

U.S. liquefied natural gas imports (Apr 30) — Energy Information Administration (EIA)

January and February US LNG imports are the lowest they have been since 2002.

Webmaster's comment: There is no need to build additional LNG import terminals. Downeast LNG is living in the past.

U.S. increases oil, gas reserve estimate (May 1) — UPI

For natural gas, the reserve estimate is almost triple what was reported five years ago. The plays are estimated to contain a combined 6.7 trillion cubic feet of undiscovered natural gas.

"These world-class formations contain even more energy resource potential than previously understood, which is important information as we continue to reduce our nation's dependence on foreign sources of oil," Interior Secretary Sally Jewell said. [Red & bold emphasis added.]

Webmaster's comment: Downeast LNG prospects keep getting worse and worse.

The basics: Understanding what LNG is (Apr 14) — Houston Chronicle, Houston, TX

Bill Cooper, president of the Center for Liquefied Natural Gas: For the first time in several decades, the U.S. has an abundance of domestically produced natural gas, more than enough to meet demand. Liquefying it allows for increased storage, not to mention efficient transport to outside markets.

Webmaster's comment: Even Downeast LNG's own industry indicates Downeast LNG is a white elephant.

Budget cuts threaten US EIA's ability to analyze US LNG exports: officials (Apr 26) — Platts

With the US currently awash in low-priced shale gas, some US companies are eager to export LNG to higher-priced foreign markets. But in a recent interview, a top EIA official said his agency cannot make needed upgrades to its tool for modeling the global market effects of increased US LNG exports because of Washington's zeal to slash federal spending.

Pad drilling and rig mobility lead to more efficient drilling (2012 Sep 11) — Energy Information Administration (EIA)

Developments in drilling methods and technology are leading to efficiency gains for oil and natural gas producers. For example, "pad" drilling techniques allow rig operators to drill groups of wells more efficiently, because improved rig mobility reduces the time it takes to move from one well location to the next, while reducing the overall surface footprint. A drilling pad is a location which houses the wellheads for a number of horizontally drilled wells. The benefit of a drilling pad is that operators can drill multiple wells in a shorter time than they might with just one well per site. [Red emphasis added.]