Global LNG Demand is Going Down – What Does it Mean for the U.S.?
MDN 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….
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Last 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: 
Two 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 
This is interesting! For some time MDN has tracked the Port Ambrose floating LNG terminal proposed by Liberty Natural Gas that would sit about 20 miles off the coast of New York and 29 miles off the coast of New Jersey, a plan Liberty created back in 2010, before the Marcellus Shale revolution really began to rock and roll. Liberty plans to import natural gas from Trinidad to sell into the northeast. In fact, Liberty took to slamming “fracked” gas from the Marcellus, saying imported gas is better for the U.S. of A. (see 
The Center for Liquefied Natural Gas (CLNG) released a new report earlier this week that purportedly shows the global environmental benefits of exporting LNG. The Pace Global-authored report, titled “LNG and Coal Life Cycle Assessment of Greenhouse Gas Emissions” (full copy below) found greenhouse gas (GHG) emissions from coal-generated electrical power to be 92 percent to 194 percent higher than from power generated from U.S.-produced LNG in five key international markets. Yes, CLNG is targeting another fossil fuel, coal, to justify itself–which is not a healthy thing in our opinion. Everyone (except 
A story we first brought you back in March continues to play out. 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. Anti-fossil fuelers who hate and oppose all fracking (indeed all fossil fuel use) are also opposed to this project. So what did Liberty Natural Gas do? They tried to convince the antis that importing gas from Trinidad is better than using nasty, evil, vile “fracked” gas (see 
Get this: The Obama administration has made a $730,000 grant to the Pittsburgh Region Clean Cities (PRCC) organization to study how to convert boats to operate more efficiently and pollute the environment less. Most boats today burn a nasty, filthy, rotten fossil fuel called diesel. Belches out all sorts of “pollutants” including carbon dioxide. Obamadroids want to clean up Mother Earth and need to figure out ways to do it. But sticking a windmill or a solar panel on a boat doesn’t work very well (Obama’s already tried it). So for the administration that’s given us the Clean Power Plan that tries to eliminate both coal and natural gas, we have a grant to convert a tugboat from burning diesel to…burning natural gas. Yep. Even Obamadroids have to admit you can power boats with solar and wind–so they’ve given $730,000 to the PRCC to run an experiment in converting a tugboat burning diesel into burning clean, abundant and cheap natural gas. Perhaps the smartest thing Obama has ever done!…
Seems like just about every pipeline project out there is, in one way or the other, connected to the Marcellus/Utica Shale and moving northeast shale gas to other markets. Example: Yesterday Columbia Pipeline Group announced they have received Federal Energy Regulatory Commission (FERC) approval to proceed with the Cameron Access Project in Southwest Louisiana. The $310 million project includes improvements to Columbia Gulf’s existing pipeline system, as well as ancillary facilities, a new compressor station near Lake Arthur, Louisiana, and the installation of an approximately 26 mile greenfield pipeline lateral in Cameron Parish that provides direct access to the Cameron LNG export facility. The purpose of the project? It “further connects abundant, but constrained, Appalachian supplies to higher value markets.” In other words, Columbia will offer a new export market for Marcellus/Utica gas via the Cameron LNG export terminal. The project is due to begin construction in the spring of 2016 and be placed in service during the first quarter of 2018…
Global research firm Wood Mackenzie recently published a brief analysis of LNG export facilities asking the question, Where are all the LNG project postponements? According to Wood researchers, the outlook for global LNG demand is looking increasingly subdued–particularly in China. The number of LNG projects proposed to make a Final Investment Decision (FID) in 2015 and 2016 has not reduced significantly. If all or close to all of the projects on the books make a FID to move forward, there would be an unsustainable glut of new LNG supplies–without a corresponding amount of demand around the globe. Wood Mackenzie’s conclusion? Companies will soon wake up to the fact that there won’t be enough demand and we will see “a raft of project postponements” in the next 6-18 months…
Both Kinder Morgan and Spectra Energy are in a tough fight to build pipelines from the Marcellus into New England. One of the competing visions for how to get more natural gas to residents, businesses and electric generating plants that so desperately need natural gas is to import it through the Everett, MA LNG import terminal. That’s where GDF Suez, the American name for the French multinational electric utility company Engie, imports natural gas. We told you about GDF Suez’s self interested last year (see 
Earlier this week a $2.85 million compressed natural gas (CNG) filling station was opened with a large crowd of people eager to begin using it. Nexus Natural Gas, a consortium of seven different companies, unveiled their first collaborative CNG fueling station aimed at cars, trucks, tractor-trailers and buses. The state got involved with a $570,000 grant–recognizing the benefits of using natural gas as a transportation fuel (burns cleaner, natural gas is a home-grown fuel). Local utility/pipeline companies are involved too–to deliver cheap, abundant and clean-burning Marcellus Shale gas to the new fueling station. What’s that? Where’s this new CNG fueling station located–where crowds of natgas lovers congregated to celebrate? Would you believe, in New York State!…