More Details on Rice/EQT Plan to Unleash LNG – M-U Needs More Pipes
Yesterday MDN brought you news of a bold new plan by EQT CEO Toby Rice to “unleash” American LNG exports to not only help our friends in Europe, but also to reduce the amount of coal use across the world, thereby lowering coal-related emissions including carbon dioxide (see EQT CEO Toby Rice Unveils Nationwide Plan to “Unleash” U.S. LNG). Rice’s plan calls for the addition of 50 natural gas drilling rigs here in the U.S., which would create about 45 billion cubic feet per day (Bcf/d) of additional natural gas by 2030. He wants 35 of those rigs located in the Marcellus/Utica.
Read More “More Details on Rice/EQT Plan to Unleash LNG – M-U Needs More Pipes”
You have to hand it to the Rice boys, they sure know how to make an entrance and grab the spotlight. While attending the annual CERAWeek event in Houston yesterday, EQT CEO Toby Rice unveiled a plan to “unleash” American LNG, supplying Europe and the world with our LNG, which would displace coal, lower carbon dioxide emissions planetwide, and wean the world off the energy produced by despots like Russia and Iran. It is a bold plan with specifics.
On the same day that EQT CEO Toby Rice released his plan to “unleash” American LNG (see today’s companion story), the U.S. Energy Information Administration (EIA) published a post that talks about LNG production from a decidedly “leashed” perspective. While Rice envisions new pipelines, rigs, and export facilities that will handle a huge increase in Marcellus/Utica drilling, the EIA’s vision is status quo–constrained pipelines from the M-U region.
As we write about today in a couple of different posts, EQT CEO Toby Rice has a bold vision to “unleash American LNG” to, in part, supply American natural gas to our friends in Europe. Rice’s plan is not an overnight plan, but it can work and it can reduce the amount of carbon dioxide emissions floating in Mom Earth’s atmosphere (if you care about such things, we personally do not). There are currently 14 (!) LNG export facilities approved by the U.S. that could be built and come online in the next year or two. That’s enough new plants to double our current LNG exports. Why haven’t the backhoes begun to dig on any of these projects? Two roadblocks.
While it may be unseemly to discuss this, U.S. LNG exports are booming because of Russia’s invasion of Ukraine. Putin is threatening to withhold natural gas flows into Europe and Europe is scrambling to try and find new sources, including imports of American LNG. The biggest winners (so far) are U.S. LNG natural gas producers and the export facilities that liquefy and ship the gas. And don’t forget the LNG container ships too. Everyone is making a LOT more money right now on LNG exports. A Reuters article says the U.S. has recorded record export volumes (and profits) over the past three months.
Hackers, believed to be “state-sponsored,” aggressively targeted computers belonging to current and former employees at two dozen major natural gas suppliers and exporters. The aim seemed to be an attempt to cripple U.S. LNG exporting ability. One of the targets of the attacks was EQT Corporation, the largest natural gas producer in the U.S. The activity occurred on the eve of Russia’s invasion of Ukraine. You do the math to figure out who the “state sponsor” of the attacks was.
According to the Toronto Financial Post, the Ukrainian crisis has put East Coast (Canada) LNG export facilities “back on the map.” The article says at least two companies are exploring LNG export options on Canada’s East Coast–to send natural gas to Europe. Our interest has been and remains the fact that if Canada does sanction one or even two LNG export facilities on the country’s East Coast, there is an excellent chance for Marcellus/Utica molecules to help feed it.
Gene Barr, president and CEO of the Pennsylvania Chamber of Business and Industry, unloaded on Joe Biden and his inept energy policies in a recent op-ed in which Barr says it’s time for U.S. energy policy to stop empowering Russia. In addition to more oil drilling and oil pipelines, Barr advocates for more natural gas drilling and more natural gas pipelines here in the Marcellus/Utica. Do you want to help Europe? Stop blocking American oil and gas, President Biden!
Despite all of Europe’s arrogant talk about rejecting America’s “fracked gas” as too dirty, the Old World imported more gas from the U.S. than from any other country on planet earth in 2021, thanks to Donald Trump’s efforts to export “molecules of freedom” to other countries around the planet. Hey Democrat media, who’s laughing now about those “molecules of freedom” with Vladimir Putin breathing down Europe’s neck?
Antero Resources, one of the biggest Marcellus/Utica drillers with 3.2 Bcfe/d (billion cubic feet equivalent per day) of production, issued its fourth-quarter and full-year 2021 update yesterday. The company earned $901 million in 4Q21, up from $70 million in 4Q20, but still lost $187 million for the full year due to hedges gone bad. Antero generated $237 million and $849 million of Free Cash Flow during the fourth quarter and full year of 2021, respectively. The company placed 10 Marcellus wells and four Utica wells online to sales during 4Q. Antero plans to drill 60-65 new wells in 2022.
The ace reporters at Reuters have sussed out another inside exclusive: Williams, the pipeline giant, has hired “two veteran executives” to help the company set up an LNG marketing operation. The operation will put Williams into direct competition with other big LNG marketers including Cheniere Energy, Shell, and QatarEnergy. The big question is this: How successful will this effort be if Williams doesn’t actually own an LNG export terminal of its own?
On Monday the U.S.-EU Energy Council held a meeting in Washington chaired by U.S. Secretary of State Antony Blinken, U.S. Secretary of Energy Jennifer M. Granholm, EU High Representative/Vice President Josep Borrell Fontelles, and European Energy Commissioner Kadri Simson. There was some talk about natural gas and ensuring sufficient supplies for Europe, especially with Russia’s Vladimir Putin threatening to shut off half of Europe’s supplies over Ukraine. There was plenty of blah blah blah talk about a “clean and just energy transition” to so-called renewables. Whatever. It was a forum held after the official meeting that caught our attention. Duncan Wood, Ph.D., Vice President for Strategy & New Initiatives at the Wilson Center made a statement with great insight about the U.S.’s potential role in supplying natural gas to the world via LNG.
This *really* has our blood boiling. The same Democrat politicians in New England who have blocked new natural gas pipelines from the Marcellus (just 200 miles away) to their region, preferring so-called “renewable energy” instead, have just asked the hapless, incompetent Secretary of the Dept. of Energy, Jennifer Granholm (a fellow Democrat) to restrict LNG exports so their constituents don’t have to suffer the pain of their (the politicians’) decision to block pipelines. We’re talking about Massachusetts’ two U.S. Senators, Elizabeth “Pocahontas” Warren and Ed “Lackey” Markey, and Sen. Pat “Leaky” Leahy whose home state of Vermont has banned all fracking and blocks pipelines. Talk about chutzpah!
Full-scale war in Eastern Europe, with Russia set to invade and annex Ukraine, seems closer now than at any time since the breakup of Yugoslavia and, before that, World War II. One very important key NATO member is resisting calls from Joe Biden to send troops and threaten sanctions against Russia if it invades: Germany. Why? Because Germany sucks on Russia’s oil and natural gas teat for a significant portion of its energy. Is there a connection between the global crisis half a world away and the Marcellus/Utica?