FERC Grants OK to Restart Freeport LNG Final Liquefaction Train
We have been closely tracking the restart of the shuttered Freeport LNG export terminal following its emergency shutdown in June 2022 after an explosion and fire. Most recently, the Federal Energy Regulatory Commission (FERC) granted permission for Freeport to restart two of three liquefaction “trains” at the facility (see FERC Clears Freeport LNG to Restart 2 of 3 Liquefaction Trains). Freeport asked for permission to restart everything else, including the final (of three) LNG train, the final (of three) LNG storage tanks, and a second (of two) births that allow ships to dock and load. Yesterday FERC granted permission to Freeport to restart the final train, but NOT the final storage tank nor the second ship dock.
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An anchor from a local ABC television affiliate in Maine somehow wandered into the truth about New England’s lack of natural gas pipelines. (He may not have a job much longer.) As we have been stating (screaming about) for years, New England politicians have blocked new gas pipelines from Pennsylvania from delivering critically-needed natural gas supplies to the region. It’s only a matter of time before New England experiences repeated blackouts due to the lack of natgas for power-generating plants. It’s coming. And yet the Democrat politicians who have an iron grip on the region refuse to see reason. What is their solution to a lack of natural gas? Turn down your thermostat and sit in the cold. And if you complain about it, they (meaning people like Maine Gov. Janet Mills) will label you a racist, bigot, homophobic Republican who must be silenced at all costs. This is our very broken system of governance today–at least in New England.
As we have been reporting, CERAWeek, the world’s premier energy conference, is happening all this week in Houston, Texas. On Wednesday, Bloomberg reporters filed a roundup/overview of happenings at the event. Below is the roundup from Day Three of CERAWeek, which includes comments made by the U.S. Secretary of Energy, Jennifer Granholm, attempting to suck up to the same oil and gas companies she has been bashing for the past two years. Also of interest, Europeans said during a panel discussion that European countries are reluctant to sign long-term LNG contracts because they believe (wrongly) that natgas will soon become “obsolete.” What dunderheads. No wonder Europe is crumbling and falling before our eyes.
NATIONAL: GenH2 and Chart Industries MoU for hydrogen liquefaction; Offshore is back; INTERNATIONAL: OPEC concerned about demand slowdown in USA, Europe; EU energy chief tells companies not to sign new Russian LNG deals.
Newly-elected Pennsylvania Governor Josh Shapiro unveiled his first-ever budget yesterday, and it was a whopper, coming in at $44.4 BILLION. We were keeping an eye on his budget for two primary things: (1) Does it include a severance tax? (2) Does Shapiro plan to get revenue from the Regional Greenhouse Gas Initiative (RGGI) carbon tax scheme? For the first, the answer is no. Thankfully, Shapiro did not lobby nor request a Marcellus-killing severance tax. Which is sure to tick off the left. However, it was a mixed bag because the budget DOES assume RGGI will kick in and provide the state with $663 million in proceeds for 2023-24. Wait, you thought Shapiro was against RGGI following his comments slamming it? Surely you’re not that dumb?
Some 18 pro-business groups in Pennsylvania joined forces to send a letter to newly-elected Gov. Josh Shapiro and every member of the PA legislature. The letter, spearheaded by the PA Chamber of Business and Industry (also the Marcellus Shale Coalition and the American Petroleum Institute of PA), congratulates Shapiro and all those winning election or reelection. It was a verbal slap on the back. But the letter goes on to request all of these newly elected officials to work together to promote domestic energy production in the Keystone State. In other words, Why can’t we be friends?
West Virginia Senate Bill (SB) 188, the Grid Stabilization and Security Act, is aimed at making WV more competitive with its neighbors–Pennsylvania and Ohio–with respect to siting more gas-fired power plants in the state. SB 188 directs the Dept. of Economic Development secretary to identify and designate sites considered appropriate for natural gas electric generation projects. It also caps the amount of time the state Air Quality Board has to hear appeals of permits for such projects to no more than 60 days. The coal lobby was not happy with some of the language and focus of the bill, so coal got its own bill, House Bill (HB) 3482, the Coal Fired Grid Stabilization and Security Act, which does the same thing for coal that SB 188 does for natural gas.
Once a month, U.S. Energy Information Administration (EIA) analysts issue the agency’s Short-Term Energy Outlook (STEO), their best guess about where energy prices and production will go in the next 12 months. We poke good-natured fun at the EIA because one month, their predictions go up, the next month, down, etc. What about the latest STEO dart board, published yesterday? EIA slashed the price of natural gas at the Henry Hub another 11% from the previous monthly report (after cutting it 30% from the preceding monthly report), saying natgas will average $3.02/MMBtu in 2023, down from a forecast of $3.40 last month, and down from $4.90 the month before.
As we have been reporting, CERAWeek, the world’s premier energy conference, is happening all this week in Houston, Texas. MDN is not there, but there are a number of news organizations on site. One of them is Bloomberg. Yes, we know, Bloomberg tilts left. But sometimes they send reporters out who actually do real reporting, as is happening from CERAWeek. On Monday, Bloomberg filed a roundup/overview of things said at the event–both in sessions and in interviews with Bloomberg reporters. Below is the roundup from Day One of CERAWeek, which includes an interesting summary of Repsol comments that the company is investing close to $1.5 billion in 2023 in exploration and production in North America. Repsol has major operations in the Marcellus–so we can expect an expanded drilling program in Repsol’s northeastern PA assets.
As we have been reporting, CERAWeek, the world’s premier energy conference, is happening all this week in Houston, Texas. On Tuesday, Bloomberg reporters filed a roundup/overview of happenings at the event. Below is the roundup from Day Two of CERAWeek, which includes a comment by EQT CEO Toby Rice, who said he believes the natural gas market will come back into balance in the “middle half” of this year as production adjusts (i.e., less drilling) following the recent precipitous collapse in prices.
Even though the Freeport LNG export facility is in the midst of restarting and is now using 1.5 Bcf/d (billion cubic feet per day) of natural gas (out of a potential 2.1 Bcf/d when it’s operating at full capacity), the new demand coming from Freeport was not enough to counter the “bad news” that the weather will not be as cold as previously predicted over the next 15 days. Weather not-as-cold spells less demand for natural gas overall, and the lack of demand has translated to a crash in the NYMEX futures price based on the Henry Hub, the national benchmark for gas trading. Yesterday the “front month” NYMEX gas price contract dropped 44 cents (17%) in a single day.
Could air pollution related to drilling shale wells affect those who live nearby? In particular, does shale drilling negatively affect the health of older folks (over age 65)? How would we know if it is affecting their health? Researchers set out to answer that question by analyzing Medicare data for older folks who live near Marcellus drilling in Pennsylvania, comparing the data with older folks who live in nearby New York, where there is no Marcellus drilling. The researchers conclude that living near shale drilling increases the likelihood of old folks having a heart attack, stroke, and other cardiovascular issues.
The Federal Energy Regulatory Commission (FERC) and Pipeline and Hazardous Materials Safety Administration (PHMSA) sent a new round of questions yesterday to Freeport LNG. The questions must be answered before the two agencies give their final blessing for Freeport to bring online its third and final train of LNG production. Which seems a bit odd to us. FERC previously granted Freeport permission to restart two of three LNG liquefaction trains, two of three LNG storage tanks, and one of two LNG births for ships to tie up and load (see