CNG/LNG

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    LNG Co Tellurian Merges With, Takes Over Magellan Petroleum

    As we pointed out to you last December, evil corporate raider Carl Icahn (invests in companies so he can fire a bunch of people, boost the stock and pocket the profit) had fired Cheniere Energy CEO Charif Souki (see Evil Corporate Raider Carl Icahn Claims Another CEO Scalp). Souki hasn’t let it slow him down. He started a new LNG export company, Tellurian, to compete with his old company (see Revenge: Fired Cheniere CEO Starts Competing LNG Company). We kind of had (past tense) a soft spot for Souki, getting tossed from the company he started. But then we read comments he made about Donald Trump, saying if Trump won, he would reconsider his American citizenship (see Will Charif Souki Renounce His American Citizenship?). We’re still waiting for Souki to move back to Egypt. Since forming Tellurian, he’s moved fast to finance the company and its coming Driftwood LNG export facility, essentially by selling off large chunks of it, $25 million from GE Oil & Gas (see GE Oil & Gas Invests $25 Million in LNG Co Tellurian), and $207 million from Total (see French Supermajor Total Buys 23% Stake in Tellurian LNG). Until now, Tellurian has been a private company, no publicly traded shares of stock. That changed last Friday when Tellurian merged with/took over Magellan Petroleum Corporation and began trading stock in the newly merged company on the NASDAQ stock exchange…
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    Dominion Updates for Cove Point, AC Pipeline, Greensville Power

    Midstream and utility giant Dominion issued their fourth quarter and full year 2016 update yesterday. Just to give you an idea of the depth and breadth of the company, Dominion has ~26,000 megawatts of power generation, 14,400 miles of natural gas transmission, gathering and storage pipeline, and some 6,500 miles of electric-transmission lines. They are “a producer and transporter of energy.” Among the key projects we keep an eye one: the Cove Point, Maryland LNG export facility (under construction), the Greensville Power Station (under construction), and the Atlantic Coast Pipeline (soon to be under construction). The numbers are looking good. Revenue for Dominion in 4Q16 was $457 million, up $100 from 4Q15. Full year revenues were $2.1 billion, up from $1.9 billion in 2015. Below we have yesterday’s update, along with select portions of a conference call by Dominion’s muckety mucks and their comments about projects like Cove Point and Atlantic Coast Pipeline…
    Read More “Dominion Updates for Cove Point, AC Pipeline, Greensville Power”

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    Exclusive: MSC’s Dave Spigelmyer Goes On the Record with MDN

    Dave Spigelmyer

    Last Friday MDN editor Jim Willis had the pleasure of speaking (via phone) with the president of the Marcellus Shale Coalition, David Spigelmyer. Some 300 companies make up the membership of the organization–including all of the top exploration & production (E&P) companies and midstream (pipeline) companies operating in our region. Dave himself used to work for Chesapeake Energy once upon a time. He is a Pennsylvania boy, born and bred, and knows the industry inside and out. Dave made time to speak with MDN about a wide range of issues. We should note nothing was “off limits”–Jim asked some tough questions. Below is a transcript of that interview. We tackle topics including the Marcellus industry outlook for 2017, the commodity price of natural gas in our region vs. other locations, the proposed severance tax in PA, various pipeline projects, the Shell cracker, MSC’s lawsuit against DEP Chapter 78a regulations, and the “civil war” between drillers and landowners over the royalty issue. It’s all in there…
    Read More “Exclusive: MSC’s Dave Spigelmyer Goes On the Record with MDN”

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    BP Report: LNG Sales to Grow 7x Faster than Pipeline Sales

    Many of the large integrated oil and gas companies produce an annual report that looks out over the next 20 years. Their best researchers peer into their crystal balls and make predictions about what will happen–and why. BP is one such company. Earlier this week BP released their annual “Energy Outlook – 2017 edition” (full copy below). The big news in the outlook, for us, is finding out that BP predicts LNG (liquefied natural gas) sales will grow seven times faster over the next 20 years than gas sold via pipelines. Making LNG a VERY important part of our future…
    Read More “BP Report: LNG Sales to Grow 7x Faster than Pipeline Sales”

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    Deloitte Report: Navigating the New World of LNG

    Despite near-term headwinds, the long-term future of global liquefied natural gas is positive for participants able to adapt to a more fragmented market, new and different customer expectations and more short-term and flexible commercial arrangements, according to Deloitte’s new report “Navigating the new world of LNG” (full copy below). In the near term, the industry expects to face headwinds of slowing demand growth, recent and imminent supply capacity expansions that could overtake the pace of demand growth, and a lower price environment that challenges the economic viability of new developments. But, “Long-term, strong underlying demand drivers and the opening of new markets could provide substantial opportunity for participants”…
    Read More “Deloitte Report: Navigating the New World of LNG”

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    Speculation: Transco Sending M-U Gas to Louisiana LNG Terminal

    Over a year ago the mighty Transco turned bidirectional, sometimes sending gas northward from the Gulf (as it’s done for 50 years), and now, sometimes sending gas from the Marcellus/Utica southward, to the Gulf. Much more gas will head south once the Atlantic Sunrise Pipeline project gets built (see FERC Approves Atlantic Sunrise Pipeline! Cabot Grabs More Capacity). However, from various stories we’ve read, and from our speculation, we’ve assumed that at least some Marcellus/Utica gas now flows far enough south that perhaps some of it reaches the Cheniere Energy LNG export facility in Sabine Pass, Louisiana (see LNG Slowly Changing the NatGas Game in the Marcellus/Utica). Until now, the gas traveling from north to south has only made it as far as the Creole Trail pipeline and from there Creole Trail would conduct the gas to Cheniere’s LNG plant in Sabine Pass. But beginning yesterday Transco is now connected directly to the Sabine Pass facility. We have to confess this is speculation on our part, but we don’t think it’s much of a stretch to say that Marcellus/Utica gas is now flowing to Sabine Pass for export. And if our gas is not now flowing to Sabine Pass, it soon will be. Here’s our evidence…
    Read More “Speculation: Transco Sending M-U Gas to Louisiana LNG Terminal”

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    Integrated LNG-to-Power – Applications for Marcellus/Utica?

    Below is an article not directly mentioning or tied to the Marcellus/Utica, but we can’t help but wonder if there are not applications for our region. The article focuses on the marketing and “packaging” of LNG (liquefied natural gas) as the new and “hottest” thing to hit the power generation world. If an electric power generating plant (that uses natgas) doesn’t sit along the route of a natgas pipeline, it needs to get that natgas via other means. Many countries around the world–not just the U.S.–are making a change from burning coal to burning natural gas. So getting the gas to the plant is an issue. There is a long chain of vendors between where gas is produced and where it gets used at a powergen plant. The gas is extracted and then hits a pipeline. That pipeline must, at some point, flow to an LNG liquefaction plant that cools and condenses the gas. The LNG is then loaded on a ship (typically) and sailed to another country. At the other country the LNG is offloaded, delivered to the end user, and before it gets used, it must go through a regasification process. There’s a lot of moving parts and logistics involved in moving LNG from point A to point B. So what if a company, or coalition of companies, were to form an alliance and market a ‘one stop shopping’ solution for power plants and the governments in other countries that want to use LNG? That’s the premise, and that’s the promise of what is beginning to be offered. No new technology–just a new way to market it. Which has applications for our own region…
    Read More “Integrated LNG-to-Power – Applications for Marcellus/Utica?”

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    Major CNG Virtual Pipeline Coming to Susquehanna County, PA

    MDN has had an eye on a trend we find exciting–“virtual pipelines”–by which we mean facilities that are located along a pipeline that compress the gas (CNG, or compressed natural gas), load it onto tanker trucks, and then distribute that gas to businesses that are not fortunate enough to be located near a natgas pipeline. With irrational opposition to pipelines seemingly rampant, virtual pipelines are a good alternative. We were first alerted to this trend when International Paper’s Ticonderoga mill in northern New York, near the Vermont border, opted for a virtual pipeline from NG Advantage, back in 2015 (see NY Paper Plant Opts for “Virtual” NatGas Pipeline Over Real One). NG Advantage has established a presence throughout New England, most recently adding Maine to their delivery options (see NG Advantage’s “Virtual” NatGas Pipeline to Maine Begins Flowing). A Camp Hill, PA-based company, Compass Natural Gas Partners, recently got into the virtual pipeline business in Lycoming County, PA (see Look Ma, No Pipeline! Lycoming County Co. Begins CNG Shipments). Yesterday PA Gov. Wolf issued a press release to say another company is starting up a virtual pipeline–this time in Susquehanna County, PA (MDN’s backyard). Xpress Natural Gas (XNG) will spend $18.6 million to build a facility that will employ nearly 90 people and load up to 100 tanker trucks a day for deliveries to customers across the Northeast and Mid-Atlantic states…
    Read More “Major CNG Virtual Pipeline Coming to Susquehanna County, PA”

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    Breakthrough for M-U Drillers: First Mini-LNG Unit Up & Running

    The Dresser-Rand business commissioned its first micro-scale natural gas liquefaction system at the Ten Man liquefied natural gas facility in Pennsylvania

    If you’ve read MDN for any length of time, you know how important LNG–liquefied natural gas–is to the future of the Marcellus/Utica. We’re all eagerly awaiting the day Dominion flips the switch on its Cove Point LNG liquefaction facility in Cove Point, Maryland (see Cove Point LNG Now 78% Complete, On Track to Open This Year). Cove Point will condense and ship 1.8 billion cubic feet per day (Bcf/d) of Marcellus/Utica gas to Japan and India. Other big LNG projects are also in the works, several of them on the East Coast of Canada. However, some Marcellus/Utica gas is already getting liquefied and shipped–via the Gulf Coast. In particular from the Cheniere’s Sabine Pass LNG facility in Louisiana (see LNG Slowly Changing the NatGas Game in the Marcellus/Utica). Cove Point, Sabine Pass and other such facilities take years to build and cost billions of dollars. But there’s another kind of LNG, “micro-scale” LNG liquefaction that is taking root in the Marcellus. Dresser-Rand, a subsidiary of German giant Siemens, has commissioned its first small-scale natural gas liquefaction system at the Ten Man LNG facility near Mansfield (Tioga County), PA. The new mini-LNG facility will, according to Dresser-Rand, allow Marcellus driller Frontier Natural Resources “monetize stranded gas assets,” by which we take to mean wells drilled that are not and cannot quickly be connected to a pipeline system. If this catches on, it can be an important alternative for drillers where pipelines are nonexistent or slow in coming…
    Read More “Breakthrough for M-U Drillers: First Mini-LNG Unit Up & Running”

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    Prof Says Lack of LNG Export Licences Killing Ohio Jobs

    A professor from an Ohio college had the temerity to publish a guest column in the liberal Cleveland Plain Dealer taking federal regulators to task over the years-long wait time it takes to get a new LNG (liquefied natural gas) facility approved. Prof. Robert Chase, Emeritus Professor in the Department of Petroleum Engineering and Geology at Marietta College, says more natural gas needs to reach the world market, via LNG, and if it doesn’t, the lack of LNG exports will put Ohioans out of work. The good prof says the incoming Trump Administration and Congress needs to take “prompt action” to “speed up the licensing process for companies seeking permits to export liquefied natural gas.” Here, here! We fully agree…
    Read More “Prof Says Lack of LNG Export Licences Killing Ohio Jobs”

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    Look Ma, No Pipeline! Lycoming County Co. Begins CNG Shipments

    In June 2015 MDN told you about a really cool plan by a Pennsylvania company to establish a CNG (compressed natural gas) terminal in Lycoming County, PA as a way to get natural gas to manufacturers, fleets and businesses where no pipeline infrastructure now exists (see Getting Marcellus NatGas to Customers without Pipelines). Compass Natural Gas Partners, based in Camp Hill, PA, said they would build a first-of-its-kind CNG terminal in Lycoming County that will accept Marcellus Shale gas in, clean it up (get rid of the water in it), compress it to 3600 psi, and load it into specially designed trailers that haul it to customers. And then the project went quiet for the next year and a half. Except it wasn’t really quiet. Compass, with a tag line on their website that says “All We Need is Road,” built the terminal and it went fully operational in December. Trucks are now servicing customers in Cambria and Mifflin counties…
    Read More “Look Ma, No Pipeline! Lycoming County Co. Begins CNG Shipments”

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    Cove Point LNG Now 78% Complete, On Track to Open This Year

    In October 2014 Dominion announced they had officially broken ground on the Cove Point LNG export plant, a project that will inject between $3.4 and $3.8 billion in Calvert County, Maryland and pump upward of 1.8 billion cubic feet per day of cheap, abundant Marcellus and Utica Shale gas (see Dominion Breaks Ground on Cove Point, MD LNG Export Facility). Anti-drilling zealots have been desperate to stop the facility in a vain attempt to stop “fracked gas.” The Sierra Club, among others, has repeatedly launched frivolous lawsuits. They’ve all failed. Dominion released a video update (below) that shows the facility is now 78% complete and “on track for an in-service date in late 2017.” There are currently 1,800 construction workers on site. All of the concrete has been poured, the sound wall is finished, and more than 50% of the steel has been installed for this project. Some 31 of the 34 barge loads have been received and 68 of the 77 heavy haul deliveries have been transported. It is all systems “go” for this project…
    Read More “Cove Point LNG Now 78% Complete, On Track to Open This Year”

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    NG Advantage’s “Virtual” NatGas Pipeline to Maine Begins Flowing

    In Oct. 2015 MDN reported a story about International Paper’s Ticonderoga mill in northern New York, near the Vermont border (see NY Paper Plant Opts for “Virtual” NatGas Pipeline Over Real One). The plant had converted to using natural gas–yet there are no natgas pipelines to be found in the region. International Paper planned to build a pipeline from Vermont to feed the plant as a permanent solution. In the meantime, it was using a “virtual pipeline” of a constant stream of trucks delivering compressed natural gas (CNG) from NG Advantage (subsidiary of Clean Energy Fuels Corp.), trucking CNG to the plant 24/7. International liked the CNG trucking operation so much, and disliked the regulatory hassles of building a pipeline so much, they decided to keep the virtual pipeline over a real one as a permanent solution. Cool story. NG Advantage, the hero in this story, continues to expand. Last November they picked up a new CEO, and at the tail end of last year, the company expanded beyond Vermont, New York, New Hampshire and Massachusetts, and began delivering CNG via their virtual pipeline trucks to customers in the state of Maine…
    Read More “NG Advantage’s “Virtual” NatGas Pipeline to Maine Begins Flowing”

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    EIA Annual Energy Outlook: US is Net Energy Exporter Within 10 Yrs

    The United States is already on the cusp of energy independence, thanks to the shale revolution. What does that mean? It means when you consider how much energy we produce and export, and how much we consume and import, at the end of the day, we are producing as much energy as we consume. But it gets complicated. We still import a lot of oil from the Middle East and elsewhere. We import (and export) oil via pipelines to Canada. We also still import natural gas. But at some point the U.S. will export more than it imports. That is, we won’t only produce as much as we consume, we’ll produce extra energy–and sell it abroad to other countries. We will become a “net exporter.” When will that happen? According our favorite government agency, the U.S. Energy Information Administration (EIA), it will happen in the next 10 years–or less. The EIA has just released its “Annual Energy Outlook 2017” (full copy below). In the report the number crunchers at EIA look at multiple scenarios and conclude that under most scenarios we are a net exporter by 2026, and in some of those scenarios, it happens even sooner. That would be the first time since 1953 that our country has exported more energy than it uses. Not surprisingly, LNG (liquefied natural gas) plays a critical role in our country becoming a net exporter. Here’s what the EIA said in releasing the 2017 annual report…
    Read More “EIA Annual Energy Outlook: US is Net Energy Exporter Within 10 Yrs”

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    Canadian Bear Paw Pipeline for LNG Exports Gets Favorable EA

    In March of this year, MDN told you that LNG Limited (from Australia) registered with the Canadian government for an environmental assessment for a pipeline they want to build in Nova Scotia–the Bear Paw Pipeline (see LNGL Applies to Build Pipeline to Bear Head LNG Export Facility). It is the first (and perhaps most important) step in getting a new 39-mile pipeline built that will run from the Maritimes & Northeast Pipeline to LNGL’s proposed Bear Head LNG export facility. LNGL envisions plentiful shale gas coming into the Maritimes & Northeast Pipeline either from the Marcellus region (via Spectra Energy’s Access Northeast Pipeline connecting to M&N) or from a long-shot plan to bring in gas to M&N from western Canada (see Canadian Bear Head LNG’s Long-Shot Plan to Get Gas). The “what gas will it be?” question still lingers. In the meantime, back at the Bear Paw Pipeline ranch–the Canadian government has just received a favorable environmental assessment (EA) for the pipeline project–which means the project has cleared all the major hurdles it needs to clear. The question now is, will LNGL actually build it?…
    Read More “Canadian Bear Paw Pipeline for LNG Exports Gets Favorable EA”

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    Elba Island LNG Update: Non-FTA Exports Approved, Dump Truck City

    Elba Island LNG

    Kinder Morgan’s Elba Island, Georgia (near Savannah) proposed LNG export facility received a green light from the Federal Energy Regulatory Commission (FERC) in June (see KM’s Elba Island LNG Export Plant Approved by FERC). Kinder has since started construction at the site. Further good news: the U.S. Dept. of Energy has just granted Elba Island permission to export LNG to non-Free Trade Agreement countries. What does the Georgia’s Elba LNG plant have to do with Marcellus/Utica? The Williams Transco pipeline runs through Georgia. Kinder owns and operates the 200-mile Elba Express pipeline, which connects the LNG facility to the Transco. Currently Elba Island imports LNG, getting it to market via the Transco. However, Williams has been on a mission to send Marcellus gas south–including to Georgia (see Marcellus Gas Heading to Georgia via Transco Pipeline). Marcellus Shale gas will, via the Transco, be at least some of, if not the primary, source for gas exported from the Elba Island facility. After getting FERC approval, Kinder began work on the expansion project last month. Currently some 325 dump trucks come and go every day at the site (7,800 per month!). Below is the news about DOE granting permission for non-FTA exports to Elba, along with an update on the frenetic pace of activity to build the new facility…
    Read More “Elba Island LNG Update: Non-FTA Exports Approved, Dump Truck City”