CNG/LNG

CNG/LNG | Dominion Energy | Energy Services | Industrywide Issues | Pipelines | Regulation

Dominion CEO Asks Senators to Fix Broken Permitting Process
March 16, 2017March 16, 2017

Dominion CEO Diane Leopold

On Tuesday, just as winter storm Stella was beginning to hit along the East Coast, a group of executives testified before the U.S. Senate Committee on Energy & Natural Resources. The session was billed as a “Hearing to receive testimony on opportunities to improve American energy infrastructure.” One of the speakers to address the Senators was Dominion CEO Diane Leopold. The thrust of her lengthy testimony was to encourage (implore?) the Senators to (in our words) fix the very broken process of permitting important infrastructure projects in this country. Leopold shared Dominion’s experience in applying for permits to build the $4 billion Cove Point LNG export project in Maryland. As bad as it was with 55 federal, state and local permits and reviews required, Leopold said Cove Point was a relative walk in the park compared to what they’re now going through with the $5.5 billion Atlantic Coast Pipeline project. Something has got to change if anything is going to get built in this country…
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CNG/LNG | Industrywide Issues | NG Vehicles

UPS Adds 390 CNG, 50 LNG Trucks to Fleet in $90M NatGas Investment
March 16, 2017March 16, 2017

UPS LNG tractor trailer

In 2013 we tipped our hat to UPS, the worldwide package delivery service, for their commitment to growing their natural gas fleet with a plan to add 700 new LNG (liquefied natural gas) tractor trailers to the fleet (see UPS to Grow NG Fleet with Additional 700 LNG Tractor Trailers). In 2015, UPS did it again. The company announced they would another 64 new LNG tractor trailers to the fleet–this batch based in Harrisburg, PA (see UPS Adds 64 New LNG Tractor Trailers to Fleet in Harrisburg, PA). It seems that UPS’s investment in natural gas comes every two years. Yesterday the company announced another massive $90 million investment in natural gas. UPS is adding an additional six compressed natural gas (CNG) fueling stations, 390 new CNG tractors and terminal trucks, and 50 liquefied natural gas (LNG) vehicles to its alternative fuel/advanced technology fleet…
Read More “UPS Adds 390 CNG, 50 LNG Trucks to Fleet in $90M NatGas Investment”
CNG/LNG | Industrywide Issues | Pipelines

Trinidad LNG Exports Keep Falling – When Will it Affect New England?
March 15, 2017March 15, 2017

Last June, MDN quasi-predicted that natural gas prices may spike during the 2016-2017 winter season in New England, due to a coming shortage of LNG from Tinidad (see Is New England Heading for Huge NatGas Price Spike this Winter?). With a warmer than normal winter, and with newfound natural gas supplies making their way to New England, prices did not spike. However, New England continues to pay prices 3-4 times higher than the rest of the country for their natgas–due to lack of supply. That hasn’t (and won’t) change, until more supplies make it to New England–either by pipeline or ship. Opponents of new pipelines to New England have included LNG importers in the region. Specifically, GDF Suez imports Trinidad gas at the Everett, MA LNG import terminal, near Boston (see New England Importer Received 59% of All LNG Ship Imports 1H15). LNG imports are one of the primary sources of natgas for New England. Antis holler and scream, “Forget the pipelines. If you must use gas, use LNG. There’s more than enough LNG to supply New England.” In a macro sense that may be true–the world is awash in LNG. But arranging shipments and sources for it takes months, even years. Right now most of the LNG GDF Suez imports comes from Trinidad. As we pointed out in our article last year, Trinidad’s natural gas sources are drying up. The country is exporting less and less. We spotted yet another article about how Trinidad’s natural gas exports are rapidly declining. Sooner or later Trinidad’s falling exports will affect GDF Suez’s imports of LNG to New England. Once again, like that famous New Englander Paul Revere, we’re issuing a warning that New England needs new sources of natgas (via pipelines), and they need it sooner rather than later…
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CNG/LNG | Energy Services | Industrywide Issues | Kinder Morgan

Kinder Morgan Sells 49% Stake in Elba Island LNG to EIG for $555M
March 2, 2017March 1, 2017

Elba Island LNG facility

Kinder Morgan’s Elba Island, Georgia (near Savannah) LNG export facility received a green light from the Federal Energy Regulatory Commission (FERC) last June (see KM’s Elba Island LNG Export Plant Approved by FERC). Kinder has since started construction at the site. In December, the U.S. Dept. of Energy granted Elba Island permission to export LNG to non-Free Trade Agreement countries (see Elba Island LNG Update: Non-FTA Exports Approved, Dump Truck City). 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. Although work continues at the facility, Kinder has decided they can use some money to help finish the project–so they’ve just sold a 49% stake in the project to investment firm EIG Global Energy Partners for $555 million. When the project is complete, Kinder says it will be worth $1.3 billion. So EIG got 49% of a $1.3 billion project (or $637 million worth of value) for $555 million. Sounds like EIG got a good deal, or perhaps Kinder was a tad desperate for the cash?…
Read More “Kinder Morgan Sells 49% Stake in Elba Island LNG to EIG for $555M”
CNG/LNG | Industrywide Issues | Research

Moody’s Says Global LNG Prices to Remain Flat “Beyond 2020”
February 23, 2017February 23, 2017

Two days ago MDN brought you Shell’s very first LNG Outlook report, which says demand for LNG around the globe will increase by a very brisk 4-5% per year from now until 2030 (see Shell Launches LNG Outlook 2017 – Rapid Growth Ahead). Shell out to know a thing or two about LNG, since they paid a staggering $69.7 billion last year to purchase BG, basically to get BG’s LNG business (see LNG Love Story: Shell Makes Play to Buy BG in $69.7B Megamerger). Someone else that watches the markets closely is Moody’s Investors Service. Moody’s has just issued a report that says demand for LNG over roughly the same period (“after” 2020), is weakening, not growing. And because of weaker demand and more supply coming online in the U.S. and elsewhere, Moody’s says the price for LNG will remain flat. Shell says demand will be strong, Moody’s says it won’t. Who do we believe?…
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CNG/LNG | Exporting | Industrywide Issues

EIA: US Will Become Net NatGas Exporter by 2018
February 23, 2017February 23, 2017

According to the U.S. Energy Information Administration (EIA) and their just-issued Annual Energy Outlook 2017, the United States will become a net exporter of natural gas beginning in 2018. A big reason for the change from being a net importer to net exporter is shale gas (of course). A further big reason why is almost solely due to one company: Cheniere Energy, and their Sabine Pass LNG export facility in southern Louisiana. However, joining Cheniere soon will be the Cove Point, Maryland LNG export facility, now nearing completion. When Cove Point gets rockin’ and rollin’ along with Cheniere, the U.S. will become a net exporter…
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CNG/LNG | Exporting | Industrywide Issues | Research

DOE’s 2016 LNG Year in Review – Sabine Pass Exports 184 Bcf!
February 22, 2017February 22, 2017

The U.S. Department of Energy’s Office of Fossil Energy has just released a full report of LNG (liquefied natural gas) imports and exports for all of 2016. The history books will look back at 2016 as the year when the world of LNG changed. Although it seemed like it took forever, in February 2016 Cheniere Energy shipped its first LNG export cargo from its Sabine Pass facility in southern Louisiana (see Cheniere Finally Ships First Sabine Pass LNG Export – to Brazil //marcellusdrilling.com/2016/02/cheniere-finally-ships-first-sabine-pass-lng-export-to-brazil/). From February through the end of December, Sabine Pass, which (we believe) included some Marcellus/Utica gas, exported an astounding 60 cargoes of LNG, moving nearly 184 billion cubic feet (Bcf) of American-made natural gas to other countries. Prices ranged from $3.72 to $6.21 per thousand cubic feet (Mcf). Cheniere (and others) are just getting started! Below is the full report from the DOE Office of Fossil Energy…
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CNG/LNG | Industrywide Issues | Ohio | Summit County

OH Company Joins Team to Develop Low-Pressure CNG Tank for Cars
February 21, 2017February 21, 2017

A. Schulman, Inc., headquartered in Fairlawn, OH, supplies plastic compounds and resins which are used as raw materials in a variety of markets. Yesterday the company announced that they will join several other companies in a joint effort to develop and produce the world’s first commercially viable low pressure natural gas storage tank for motor vehicles. A year ago MDN brought you news about a breakthrough in CNG (compressed natural gas) tanks for passenger vehicles (see New CNG Tanks on the Way for Passenger Vehicles – Game Changer?). The typical CNG fuel tank is big and bulky and holds compressed gas at a pressure of 3,600 pounds per square inch (psi). United Technologies Corp. innovated a new tank that is much smaller, using “activated carbon adsorbents” technology that will allow CNG to be stored at 1,000 psi. United Technologies licensed their technology to Adsorbed Natural Gas Products, Inc. (ANGP) which will manufacture the new fuel tanks. A. Schulman announced yesterday they are partnering with ANGP to make manufacturing those tanks possible…
Read More “OH Company Joins Team to Develop Low-Pressure CNG Tank for Cars”
CNG/LNG | Energy Companies | Industrywide Issues | Research | Shell

Shell Launches LNG Outlook 2017 – Rapid Growth Ahead
February 21, 2017February 21, 2017

Click for larger version

On Monday, Shell launched its first-ever “LNG Outlook,” an assessment of the global liquefied natural gas (LNG) market. Shell, you may recall, purchased BG in 2016 (announced in 2015), the largest such deal (at $69.7 billion) since Exxon bought Mobil and merged it in. The reason for the purchase? LNG (see LNG Love Story: Shell Makes Play to Buy BG in $69.7B Megamerger). According to the outlook released by Shell yesterday, global demand for unliquefied natural gas is expected to increase by 2% a year between 2015 and 2030, while LNG demand will rise at twice that rate–4 to 5% per year. The outlook says that while many expected a big increase in new LNG supplies that would outpace demand in 2016, something unexpected happened. Demand for LNG kept pace with supply due to a spike in demand coming from Asia and the Middle East. Two of the fastest growing buyers are China and India, growing their imports at a steep clip. Add to that, six new countries began importing LNG last year: Colombia, Egypt, Jamaica, Jordan, Pakistan and Poland. What it all spells is that even with more LNG supplies coming online in the U.S. (and other countries, like Australia), the demand is there to sop up the supply. Here’s the Shell LNG Outlook, first edition…
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CNG/LNG | Dominion Energy | Energy Services | Exporting | Industrywide Issues | Maryland | Processing Plants | Statewide MD

Cove Point LNG Progress Report for FERC – Now 84% Complete
February 17, 2017February 17, 2017

Fossil fuel haters did their best to stop Dominion’s Cove Point LNG export facility in Lusby, Maryland. They sued (see Radicalized Sierra Club Files Cove Point Appeal in DC Court). They protested (see Cove Point Protesters Disrupt Monday Night Football Game on TV). They screamed and hollered and lied (see Cove Point Protester Sentenced to Jail, Lied About Police Assault). But in the end, it didn’t matter. The project has gone forward, and according to Dominion CEO Thomas Farrell, Cove Point is now 84% complete and will go online later this year…
Read More “Cove Point LNG Progress Report for FERC – Now 84% Complete”
CNG/LNG | Industrywide Issues | M&A

LNG Co Tellurian Merges With, Takes Over Magellan Petroleum
February 14, 2017February 15, 2017

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…
Read More “LNG Co Tellurian Merges With, Takes Over Magellan Petroleum”
CNG/LNG | Dominion Energy | Electrical Generation | Energy Services | Exporting | Industrywide Issues | Pipelines

Dominion Updates for Cove Point, AC Pipeline, Greensville Power
February 2, 2017February 2, 2017

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…
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CNG/LNG | Commodity Price | Economic Impact | Industrywide Issues | Litigation | NGLs | Pennsylvania | Pipelines | Regulation | Statewide PA | Taxation

Exclusive: MSC’s Dave Spigelmyer Goes On the Record with MDN
January 30, 2017January 30, 2017

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…
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BP | CNG/LNG | Energy Companies | Industrywide Issues | Research

BP Report: LNG Sales to Grow 7x Faster than Pipeline Sales
January 27, 2017January 27, 2017

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…
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CNG/LNG | Industrywide Issues | Research

Deloitte Report: Navigating the New World of LNG
January 26, 2017January 26, 2017

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”…
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CNG/LNG | Energy Services | Industrywide Issues | Pipelines | Transco | Williams

Speculation: Transco Sending M-U Gas to Louisiana LNG Terminal
January 25, 2017January 25, 2017

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”