CNG/LNG

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    DOE Study: More LNG Exports Don’t Mean Higher Prices at Home

    What would happen if the U.S. increased LNG (liquefied natural gas) exports from 12 billion cubic feet per day (Bcf/d) to 20 Bcf/d? A new report just published by the Dept. of Energy and researched by Rice University and Oxford Economics, titled “The Macroeconomic Impact of Increasing U.S. LNG Exports” (full copy below) finds that although prices for U.S. consumers may go up a little, what would happen is that the production pie would grow and most of the delta (the difference between 12 and 20 Bcf/d) would come from new production. In other words, it’s a win/win. More jobs, more money flowing into the U.S., while at the same time very little rise in gas prices here at home–even if we ratchet up exports significantly…
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    Platts Says LNG Heading to Japan & Korea Fetching $7.40/Mcf

    Platts Japan/Korea Marker (JKM) LNG service issued an update yesterday that caught our eye. The JKM service says that LNG (liquefied natural gas) for delivery to northeast Asia (Japan and Korea) will average $7.397 per million British thermal units (MMBtu) for January delivery. Converted, that’s $7.40/Mcf (thousand cubic feet). That number is down 26.5% year-over-year. But hey, if our drillers were getting $7.40/Mcf for their gas? We’d be singing, “We’re in the money…” The problem is, of course, we don’t (yet) export our natural gas via LNG to any other countries. That’s about to change in January when Cheniere Energy’s Sabine Pass LNG facility begins shipping (see Genscape: Sabine Pass LNG Export Began Accepting Natgas on Dec 10). It’s not likely any gas will head to Asia from our shores until the Cove Point LNG export facility in Maryland is completed in the next few years. Until then, we can only watch and hope that some day our gas will be sold for $7+ per Mcf…
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    Genscape: Sabine Pass LNG Export Began Accepting Natgas on Dec 10

    Cheniere Energy’s Sabine Pass LNG (liquefied natural gas) export facility in Louisiana is in the process of ramping up for it’s very first shipment of U.S.-produced LNG that will head to a foreign destination. In fact, this will be the very first exported shipment of LNG from the Lower 48 states–ever. Cheniere itself is tight-lipped about the exact date it fires up the plant and begins liquefaction, the process of supercooling natural gas into liquefied natural gas. So how do we know the plant has been activated? Through the ingenious work and service from a company called Genscape. MDN editor Jim Willis sat in on a Genscape presentation at Bloomberg’s offices in New York City in early November. They have a really cool service. Using special cameras mounted on nearby properties, Genscape can tell if natural gas is flowing through a pipeline, or if a plant’s compressors are fired up and working, or even monitor truck and rail shipments into and out of facilities like Sabine Pass. Using their proprietary technology, Genscape says “the first substantial deliveries (46 million cubic feet) of natural gas flowed into the Sabine Pass facility on Dec. 10. Why does MDN care? Because some of that gas either already does, or soon will, come from the Marcellus/Utica…
    Read More “Genscape: Sabine Pass LNG Export Began Accepting Natgas on Dec 10”

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    Evil Corporate Raider Carl Icahn Claims Another CEO Scalp

    In what has become an all-too-familiar pattern, evil corporate raider Carl Icahn has struck again, claiming another CEO scalp. Like he did with Chesapeake Energy, Icahn increased his stake in another oil and gas company, Cheniere Energy, about to export the very first shipment of exported LNG from the Lower 48 states. After Icahn grabbed a big share of Cheniere (13.8%), he forced out the company’s co-founder and CEO, Charif Souki. It’s disgusting, it’s immoral, it’s unethical–but unfortunately, it’s legal and even vaunted by investors who worship at the alter of the Almighty Buck. Like the case of Aubrey McClendon being forced out of the company he founded, Chesapeake Energy, Souki was a maverick, and he erred by taking too much OPM–other people’s money. The firing of Charif Souki certainly takes the luster and excitement off the company’s pending first export shipment of LNG. If Cheniere goes bankrupt (not beyond the realm of possibility as Souki is credited with keeping the company afloat), it will be because of Icahn’s action. Investors can thank old Carl. What’s happening, of course, is that Icahn wants to put some new financial paint on the company so he can flip it in a year or two, adding more billions to his existing billions. Jerk. The company has appointed an interim CEO (board member Neal Shear) while they look for a new hatchet man like Ichan did at Chesapeake with Doug Lawler. Let the firings begin!…
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    A “Virtual Pipeline” for NatGas Goes Live in Upstate New York

    virtual pipelineWe’ve written about the concept of a “virtual pipeline” a couple of times before, in October (see NY Paper Plant Opts for “Virtual” NatGas Pipeline Over Real One and Florida Co. Building Big CNG “Mother Station” in Marcellus Region). The simplified version is this: Instead of laying a pipeline in the ground, which is more or less permanent, use trucks and even trains to transport compressed natural gas (CNG) to a central facility and from that facility distribute the gas–either by local pipelines or by trucks. Sort of a hub and spoke system applied to moving natural gas. We find it intriguing. For the second time in the past few months such a system is being created in New York State. But this time it’s being created by a large/major utility–New York State Electric & Gas (NYSEG). NYSEG is allowing new customers to sign up for natural gas in the Mechanicville (Saratoga County), NY area with the addition of a new “virtual pipeline” of CNG trucks that deliver CNG to a centralized facility in town. Here’s how that gas will help Mechanicville economically expand and provide new jobs…
    Read More “A “Virtual Pipeline” for NatGas Goes Live in Upstate New York”

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    North America’s Largest Private CNG Facility Opens in Detroit

    TruStar Energy, one of the biggest Compressed Natural Gas (CNG) fueling station operators, over the weekend announced it has completed construction of the largest private CNG fueling station in North America. The facility was built in Detroit for FCA US and will fuel 179 FCA tractor trucks that haul parts and materials to plants located in Michigan, Ohio and Ontario, Canada. The press release does not say where the natural gas comes from that gets compressed and used, but we have to believe at least some of that gas is coming from the Utica/Marcellus, which makes this a story of interest for MDN…
    Read More “North America’s Largest Private CNG Facility Opens in Detroit”

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    How a Louisiana LNG Export Facility is Connected to the Marcellus/Utica

    An article about Cheniere Energy’s Sabine Pass Liquefaction Project (LNG export plant) in remote Louisiana caught our attention for a couple of reasons. First, the plant will make its first shipment of LNG in January. Some of the natural gas the hungry Sabine Pass facility will use will (eventually) come from the Marcellus/Utica, via pipeline. That makes the Sabine Pass plant story an important story for our region. Second, the plant is a picture of/preview for what is coming to other regions where such facilities are built–like Cove Point, Maryland where Dominion is currently building (about half done) the Cove Point LNG export facility. Sabine Pass is a massive economic and job creation engine for Louisiana’s south coast. So too will Cove Point be for Maryland in the Chesapeake Bay area…
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    Antis Try Last Desperate Ploy to Stop Cove Point LNG in Court

    Dominion is working fast and furiously on constructing the Cove Point LNG export facility in Maryland. In fact, it’s now half done (see Dominion 3Q15: Progress on Atlantic Coast Pipeline, Cove Point LNG). Even though the Federal Energy Regulatory Commission (FERC) gave its blessing on the project, and even though Dominion suffered through something like 70+ federal, state and local permits to begin building, irrational anti-fossil fuel haters are still opposing the project. We told you how some of the most extreme among them endangered fans at an NFL game recently (see Cove Point Protesters Disrupt Monday Night Football Game on TV). Now comes word that several groups of nutters, including Waterkeepers Chesapeake, Potomac Riverkeeper, Lower Susquehanna Riverkeeper and others have filed a “friend of the court” brief in a lawsuit that is trying to get the project stopped cold in its tracks…
    Read More “Antis Try Last Desperate Ploy to Stop Cove Point LNG in Court”

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    The Incredibly (Stupid) Hulk Praises Cuomo for Port Ambrose Veto

    Last Friday MDN told you that New York Gov. Andrew Cuomo had once again bowed to political pressure from his lunatic left and vetoed a proposed off-shore LNG import facility called Port Ambrose (see NY Gov. Cuomo Vetoes Port Ambrose LNG Import Terminal). Not having much to do between Avengers movies, Mark Ruffalo (who plays Bruce Banner/Incredible Hulk) occupies his time by making the rounds at small anti-fracking protest rallies where adoring fans as vapid as he is engage in sickening hero worship–believing a professional liar (i.e. actor) actually knows something about fracking and should be believed. Hearing of Cuomo’s veto of the Port Ambrose project–a project that would have imported non-fracked gas from Trinidad, potentially displacing fracked Marcellus gas–Ruffalo issued the following statement from his Americans Against Fracking organization praising Cuomo…
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    NY Gov. Cuomo Vetoes Port Ambrose LNG Import Terminal

    vetoA rather abrupt end for an issue that was just getting started. Liberty Natural Gas filed a plan back in 2010, prior to the Marcellus Shale revolution, to construct an off-shore LNG import (not export) facility off the coast of New York and New Jersey–in the ocean. A floating LNG facility called the Port Ambrose project. A pipeline would run from the off-shore terminal to Jones Beach, NY and from there would connect to a Transco pipeline lateral. The U.S. Coast Guard recently gave their blessing to the project (see Coast Guard Approves Port Ambrose LNG Import Terminal Near NYC/NJ). Liberty has tried to sell the project to New York and New Jersey anti-drilling nutters by saying the gas would come from Trinidad and wouldn’t be that nasty, fracked gas loaded with radon (see Liberty Says “Non-Fracked” Trinidad Gas Better than Marcellus Gas). Needless to say that was a whopping error on Liberty’s part–to smear the entire drilling industry in a vain attempt to garner favor with Kool Aid drinking global warmers, just to make a buck. Liberty’s “it’s not fracked gas” rationale didn’t stop the antis–they were just beginning to organize with protests and rallies–their version of a tailgate party at an NFL game. And now New York Gov. Cuomo has gone and ruined it for them. Cuomo, with the stroke of a pen, has vetoed the project. It’s dead. Done. Finished. Won’t happen…
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    Cove Point Protesters Disrupt Monday Night Football Game on TV

    Cove Point Protesters2The crazies have done it again. Did you happen to watch Monday Night Football this past Monday? It was the Indianapolis Colts playing the Carolina Panthers at the Bank of America stadium in Charlotte, NC. During the game, protesters of the Dominion Cove Point LNG plant “dramatically” rappelled from an upper deck and unfurled a banner that said “BoA: Dump Dominion”. Note that the teams are from North Carolina and Indiana, nothing to do with Maryland where the Cove Point plant is. The only tie-in is the stadium is named after Bank of America and BoA has some financial/commercial connection to Dominion. In fact, 99.9% of the people in the stadium or watching by television didn’t even know what was meant by the banner! The protesters not only endangered themselves, they endangered the people underneath them. What if the protesters had fallen? No, we’re not concerned for the nutjobs if they had Darwined themselves and dropped like a rock. We’re concerned about the people underneath them. What if the banner had fallen on people? What if a shoe had flown off one of these nutters and hit a baby on the head? The protesters finally came down and were promptly arrested for their crime…
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    Dominion 3Q15: Progress on Atlantic Coast Pipeline, Cove Point LNG

    progressYesterday Dominion, a huge utility/pipeline company operating in 13 states and organized into multiple corporations, released their third quarter 2015 update. Frankly, the official press release was pretty boring and short–concentrating on the financials. Our chief interest is on the operations side–tell us about the projects under way. So we went trolling through a transcript of yesterday’s investors conference call and sure enough, came up with gold. Tom Farrell, CEO of Dominion, had quite a bit to say in his prepared remarks about the Atlantic Coast Pipeline, the Cove Point LNG export plant, and even about “farmouts” of Utica acreage. Farrell said that surveying is 85% complete for the Atlantic Coast Pipeline, and engineering is 75% complete with some contracts for pipe already awarded. Farrell said that overall, the Cove Point project is now 47% done and there are 1,300 workers on site now. Exciting! But what’s this business about farmouts?…
    Read More “Dominion 3Q15: Progress on Atlantic Coast Pipeline, Cove Point LNG”

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    Florida Co. Building Big CNG “Mother Station” in Marcellus Region

    virtual pipelineA harbinger of things to come? Just two days ago MDN reported on an upstate New York paper mill that converted to using natural gas to operate the mill and decided to stick with trucked compressed natural gas (CNG), something called a “virtual pipeline,” instead of going through the hassles of building a permanent pipeline (see NY Paper Plant Opts for “Virtual” NatGas Pipeline Over Real One). On the heels of that announcement we have a second virtual pipeline announcement. A company based in Florida called Pentagon Energy announces they’ve just scored their first contract–in the Marcellus Shale–to build a CNG “Mother Station” (think central hub) that will truck 2.5 billion cubic feet (Bcf) of CNG per month to customers throughout the northeast. It is another virtual pipeline to customers not served by a real pipeline. We find this an exciting development with the power to mute some protests over pipelines. So who is Pentagon Energy and who is their first, big customer?…
    Read More “Florida Co. Building Big CNG “Mother Station” in Marcellus Region”

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    Global LNG Demand is Going Down – What Does it Mean for the U.S.?

    if you build it will they comeMDN editor Jim Willis still remembers the thunderclap of understanding he experienced while attending the Platts Global Energy Outlook Forum in New York City in December of 2013 (see Energy Industry Leaders Gather at Platts Forum in NYC). As we wrote at the time: “The one thing Jim learned (honest admission) is how much he doesn’t know about the wider energy industry. We who toil away in the shale gas and oil industry are, according to those at the Forum, a bit myopic. I think that’s probably true. Our heads are down and we’re fighting crazies every day and forget to look up and take stock of how our piece of the energy puzzle fits with the rest of the puzzle. The Forum helped provide some of that perspective for Jim.” In many ways that statement remains true–that the oil and gas industry is working hard and treading water and doesn’t stop to consider the global interconnection between not only oil and gas, but all energy sources. We can produce lots of gas in the U.S., but where and how will it get used? With all due respect to the great actor Kevin Costner, if you build it, they don’t necessarily come! As in, if we continue to pump out enormous quantities of natural gas and think that exports will save the day–that other countries will soak up our extra capacity–well, it’s a nice thought, but not necessarily true. Case in point: Platts is out with a sobering assessment of LNG going to Japan and Korea (and even China)–and the picture is not pretty for exporters here in the U.S….
    Read More “Global LNG Demand is Going Down – What Does it Mean for the U.S.?”

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    NY Paper Plant Opts for “Virtual” NatGas Pipeline Over Real One

    virtual pipelineLast year International Paper’s Ticonderoga mill in northern New York, near the Vermont border, received $1.75 million in grant money from Andrew Cuomo and New York State (that is to say, from we the taxpayers) to help with an $11 million project to convert the plant from using oil to using natural gas (see the Albany Times Union story: $100M in upgrades at International Paper mill in Ticonderoga follows state deal for aid, cheap power). Kind of ironic that Andy was willing to give big money to an evil corporation to use more natural gas because he banned the extraction of fracked natural gas in NY later that same year. However, the plant was threatening to close. It’s the biggest employer in the area representing 600 jobs. Because of Cuomo’s $1.75M grant, the plant stayed open and converted to natgas, but that means it needs a lot of natgas on a regular basis. International Paper had 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 operation so much, and disliked the regulatory hassles of building the pipeline so much, they’ve decided to keep the virtual pipeline over a real one as a permanent solution…
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    What’s Next for NY/NJ Port Ambrose Floating LNG Terminal?

    who caresTwo days ago MDN told you that the U.S. Coast Guard has approved of a project off the coast of New York and New Jersey that would import natural gas from Trinidad (see Coast Guard Approves Port Ambrose LNG Import Terminal Near NYC/NJ). The USCG’s approval is an important step–but not the only step before Liberty Natural Gas begins construction of the Port Ambrose floating LNG facility. The project must be approved by the United States Maritime Administration too. And, either governor, NY Gov. Andrew Cuomo or NJ Gov. Chris Christie, can veto the project and prevent it–a lot of power for a governor to wield. We’re not all that excited about the Port Ambrose project ourselves–we think it’s not necessary with all of the gas we have in the Marcellus/Utica. We also don’t like how Liberty bashes “fracked gas” like the molecules in Marcellus gas are somehow different from natural gas imported from Trinidad. That’s just a marketing ploy. What’s really hilarious is how anti-fossil fuelers are reacting. Once again, as they did with the fracking issue, antis are stalking Gov. Cuomo at public events to pressure him to veto this project. A group of made complete asses of themselves Wednesday night by dressing up in Revolutionary War-era costumes and singing environmental versions of songs from the musical “Hamilton” that Cuomo attended. Will Cuomo cave to these nutjobs yet again as he did with fracking? Will Liberty get to build their off-shore import terminal? Do we even care?…
    Read More “What’s Next for NY/NJ Port Ambrose Floating LNG Terminal?”