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"For much of the state of Maine, the environment is the economy"
                                           — US Senator Susan Collins, 2012 Jun 21



 

News Articles
about
Passamaquoddy Bay & LNG

2013 February


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2013 Feb
28

Nova Scotia

New Brunswick

Northeast

Gulf of Mexico

Caribbean

British Columbia

Canada

United States

26

New Brunswick

Passamaquoddy Bay & Maine

Caribbean

22

Gulf of Mexico

British Columbia

United States

Mexico

21

New Brunswick, Maine, and New England

Gulf of Mexico

Caribbean

Alaska

British Columbia

United States

20

Nova Scotia

Gulf of Mexico

Alaska

British Columbia

Canada

United States

19

Nova Scotia

Caribbean

British Columbia

California

Hawaii

United States

Mexico

18

Northeast

Gulf of Mexico

Alaska

British Columbia

16

Canadian Maritimes, Maine & New England

United States

15

Gulf of Mexico

Caribbean

Alaska

British Columbia

United States


There were an inordinate number of news articles regarding non-North American and Caribbean countries involved with North American LNG issues. We do not normally include LNG articles outside of North America, the Caribbean, and Hawaii. — SPB webmaster


Panama

Chile

Africa

Japan

Russia

14

New Brunswick

Alaska

British Columbia

United States

12

Gulf of Mexico

British Columbia

United States

World

11

New Brunswick

Gulf of Mexico

British Columbia

United States

8

Gulf of Mexico

British Columbia

United States

7

Gulf of Mexico

Caribbean

United States

6

New Brunswick

Maine

Southeast

Gulf of Mexico

Caribbean

British Columbia

Canada

United States

Mexico

1

Southeast

Caribbean

Alaska

British Columbia

United States

Top

2013 February 28

Nova Scotia

Pieridae Energy registers Goldboro LNG for Environmental Assessment — Canada Newswire

The proposed Goldboro LNG facility is anticipated to receive, liquefy and export up to about ten million metric tons of natural gas per year and have on-site storage capacity of 690,000 cubic metres of LNG.... [Red, yellow & bold emphasis added.]

Webmaster's comment: This proposed LNG export terminal in Nova Scotia plans to export natural gas from the Marcellus Shale field in Northeastern United States. The company has also indicated the project requres the Maritimes and Northeast Pipeline to reverse direction so that it could export US-source natural gas.

Reversing the Maritimes and Northeast Pipeline would prohibit Downeast LNG from shipping any natural gas to the south. Of course, it would only "prohibit" Downeast LNG if Downeast LNG actually were to able to get permits, construct, and operate an import terminal. Save Passamaquoddy Bay is making sure that does not happen.

LNG proposal to get public scrutiny (Feb 27) — The Chronicle Herald, Halifax, NS

On Feb. 18, Pieridae filed its registration document for a Class 2 environmental assessment with the provincial government. The document outlines the facility the company is proposing.

The public has until March 29 to review and comment on the document.

The environmental assessment document indicates the flow of gas in the Maritimes & Northeast Pipeline would have to be reversed so natural gas from New Brunswick and the northeastern United States could be shipped to Goldboro. [Red, yellow & bold emphasis added.]

New Brunswick

Repsol writes down Canaport by $1.3B after failing to sell LNG terminal in blockbuster Shell deal (Feb 26) — Financial Post, Don Mills, ON

Spanish energy giant Repsol SA said Tuesday it is writing down the value of its Canaport LNG import terminal on Canada’s East Coast by $1.3-billion, after it failed to sell the under-used hub alongside other assets in a blockbuster deal with Royal Dutch Shell Plc.

The billion-dollar write-down is the latest case of a major North American asset falling victim to supply changes wrought by shale gas.

“It’s pretty hard to make a case for bringing LNG in anywhere in North America when we have such a supply of unconventional gas that’s been brought on,” said Ed Kallio, director of gas consulting at Ziff Energy Group. “Since 2008, we’ve added 15 billion cubic feet per day of supply in the Lower 48. A lot of supply has come on and it’s backed out LNG.”

Canaport was designed with a total “send-out” capacity of 1.2 billion cubic feet per day. Its throughput averaged just 35% to 40% per year, according to a company spokesperson. Those volumes could plummet further still, as Canadian imports to New England are undercut by domestically sourced production from the massive Marcellus shale, Mr. Kallio said. [Red, yellow & bold emphasis added.]

Repsol strikes $6.7B LNG deal with Shell (Feb 27) — The Deal Pipeline

Repsol had also hoped to sell its Canaport LNG regasification terminal in Canada but an auction of the asset has stalled due to low North American gas prices. Repsol said that it was continuing to look at options for the business and will write down $1.3 billion of its value at the time that it closes the sale of the other LNG assets to Shell. [Red, yellow & bold emphasis added.]

Webmaster's comment: The natural gas glut has cost Canaport LNG $1.3 billion in asset value.

Repsol holds onto Canaport LNG after Shell deal (Feb 27) — CBC News

The official word from Canaport is that it is operating at 35 per cent capacity. The low capacity may have lowered interest to potential buyers, even if Repsol's other LNG holdings are profitable.

As part of the agreement, Shell will supply a million tons of LNG to Canaport over the next decade.

"One million tons over a 10-year period amounts to about half a billion cubic feet per year. This is a miniscule amount of LNG,” [Energy Intelligence analyst Barbara Shook] said.

Depending on the size of the ship a million tons of LNG amounts to about one or two deliveries per year, she said. [Red, yellow & bold emphasis added.]

Webmaster's comment: Canaport LNG is hurting for business.

Shell buys Repsol LNG assets in Americas for $4.4 billion (Feb 27) — Bloomberg

Canaport was offered for sale and will be written down for $1.3 billion. Its 25-year commitments to ship gas into North America were considered a hurdle to closing the deal as the continent’s domestic gas supply swelled from shale fields, two people familiar with the matter said earlier this month. [Red, yellow & bold emphasis added.]

Northeast

Idea for Philadelphia LNG export terminal floated at council hearing — State Impact, PA

Philadelphia’s deep water port and access to rail lines would make the city an ideal location for a liquefied natural gas terminal, industry representatives told City Council members on Wednesday. But they need to move fast.

Bormack testified at a hearing convened by Councilman David Oh, and Republican State Senator Michael Brubaker. The discussion focused on how Philadelphia could take advantage of the Marcellus Shale drilling boom.

But the chances any terminal would be approved for Philadelphia seems slim. With 16 applications already pending, it’s unlikely the DOE would approve all of them. Mitchell Barmack, from the engineering firm TRC, later testified to how the math wouldn’t sustain so many terminals. Bormack suggested the City could partner with Philadelphia Gas Works to build an export terminal. But of the current pending applications, one is for Cove Point, Maryland, a facility that was originally proposed as an import terminal before the shale gas rush. It’s unlikely the DOE would site two terminals so close to one another.

Gulf of Mexico

USA: Magnolia LNG wins DOE approval for FTA exports — LNG World News

Liquefied Natural Gas Limited said that the Office of Fossil Energy of the Department of Energy (DOE), United States, has granted authorisation for Magnolia LNG to export up to 4 mpta of LNG, from its proposed LNG project site at the Port of Lake Charles, Louisiana.

Shale Gas Revolution: Top promising LNG export investments — Seeking Alpha

[This article also appears under the British Columbia, Canada, and United States headings, above. It contains information about several LNG projects and related companies.]

LNG Export Terminals

  • Cheniere Energy (LNG)
  • LNG Canada
  • Kitimat LNG
  • Freeport LNG

Caribbean

Trinidad looks to LatAm, Caribbean for natural gas exports (Feb 26) — Reuters

Trinidad and Tobago is turning to markets in Latin America and the Caribbean for sale of its natural gas as its exports to the United States, once its major customer, quickly decline in the face of the North American shale gas revolution.

Trinidad and Tobago's LNG exports to the United States used to account for 80 percent of its exports, but that is falling fast.

LNG shipments to the United States accounted for only 19 percent of total exports from October 2011 to May 2012, declining from the 22 percent in the corresponding period a year earlier, according to the government's Review of the Economy 2012. [Red & bold emphasis added.]

British Columbia

Progress adds rigs to ramp up for LNG exports (Feb 27) — Calgary Herald, Calgary, AB

Progress Energy Canada Ltd. plans to triple the rig count in its B.C. Montney play this year as it gets ready to ship LNG on behalf of its Malaysian national oil company owner by 2018.

Shale Gas Revolution: Top promising LNG export investments — Seeking Alpha

[This article also appears under the Gulf of Mexico, Canada, and United States headings, above. It contains information about several LNG projects and related companies.]

LNG Export Terminals

  • Cheniere Energy (LNG)
  • LNG Canada
  • Kitimat LNG
  • Freeport LNG

Canada's LNG industry expects greater demand from China:Xinhua (Feb 27) — Morning Whistle, China

The liquefied natural gas (LNG) industry in Canada on Monday projected greater demand from China over the next several years, which could provide huge business opportunities for British Columbia (BC), a province with abundant natural gas deposits in western Canada.

TransAlta looks to Australian model in B.C. LNG strategy (Feb 27) — Financial Post, Don Mills, ON

CALGARY — TransAlta Corp., Canada’s largest publicly traded power generator, is looking to duplicate a strategy of partnering with miners in Western Australia to capture new business in British Columbia’s emerging liquefied natural gas industry.

Ms. Farrell said TransAlta would follow a similar tack of partnering with exporters in Western Canada, where companies are rushing to build LNG capacity to escape a crippling natural gas supply glut.

“In the Western Australian market there’s not enough grid to supply those mines, and so we tend to work with those miners behind the fence to find power supply that gives them their reliability, and then where we can we try to help connect it into the grid to get additional benefits,” she said. “So the kind of work we do in Western Australia is exactly the kind of work we’re doing in B.C.” [Red emphasis added.]

Canada

Shell's $6 billion deal with Repsol crowns LNG king (Feb 27) — OilPrice.com

...The Canadian government of Prime Minister Stephen Harper is trying to court Asian investors to an energy market that counts the United States as its dominant trading partner in that sector. Early this month, the government there signed off on an export license for LNG Canada Development Inc. to deliver more than 650 million tons of LNG out of a planned export terminal in British Columbia over the next 25 years. That’s the equivalent of shipping nearly 1.3 trillion cubic feet per year by conventional pipe. With few options of its own, meanwhile, the shale natural gas boom in the United States is giving lawmakers and those in the energy industry reason to press the Department of Energy to get on the LNG bandwagon. Not to be outdone, Gazprom said Wednesday it was discussing LNG options with China National Petroleum Corp., one of the largest energy companies in the world.

Shale Gas Revolution: Top promising LNG export investments — Seeking Alpha

[This article also appears under the Gulf of Mexico, British Columbia, and United States headings, above. It contains information about several LNG projects and related companies.]

LNG Export Terminals

  • Cheniere Energy (LNG)
  • LNG Canada
  • Kitimat LNG
  • Freeport LNG

United States

Shale Gas Revolution: Top promising LNG export investments — Seeking Alpha

[This article also appears under the Gulf of Mexico, British Columbia, and Canada headings, above. It contains information about several LNG projects and related companies.]

LNG Export Terminals

  • Cheniere Energy (LNG)
  • LNG Canada
  • Kitimat LNG
  • Freeport LNG
Top

2013 February 26

New Brunswick

Shell buys Repsol LNG assets in Americas for $4.4 billion — Bloomberg Businessweek

The deal, which helps the Spanish oil company avoid a credit-rating downgrade to junk, gets Shell export capacity in Peru as well as in Trinidad and Tobago, The Hague-based company said yesterday. Shell will take over financial leases and assume debt, bringing the transaction’s total value to $6.7 billion. Repsol’s Canaport terminal in Canada, which imports gas into North America, was not sold.

Canaport was offered for sale and will be written down for $1.3 billion. Its 25-year commitments to ship gas into North America were considered a hurdle to closing the deal as the continent’s domestic gas supply swelled from shale fields, two people familiar with the matter said earlier this month.

Repsol’s contracts through Canaport soured after the extracting of gas from shale rock created a glut of the commodity and caused prices to plunge. Shipments from Canaport have fallen 42 percent this winter compared to the year before, Bentek Energy LLC data reported by U.S. regulators show. [Red, yellow & bold emphasis added.]

Webmaster's comment: Canaport LNG's imports have fallen 42% this winter!

Repsol to sell LNG assets to Shell in attempt to reduce debt — OilPrice.com

No specific details of the offer were given, however it was noted that the sale to Shell did not include the Canadian assets, which have actually been valued negatively due to the shale gas boom just south of the border in the US. [Red, yellow & bold emphasis added.]

Webmaster's comment: Canaport LNG has a negative value! Is Downeast LNG's Dean Girdis paying attention?

Repsol sells Shell LNG assets for $8.23 billion (Feb 27) — The Straits Times, Singapore [Paid subscription]

Repsol said it is keeping its LNG assets in Canada, and signed a supply agreement with Shell, as the current low gas prices in North America would not allow it to earn a return on the Canaport regasification terminal. [Red, yellow & bold emphasis added.]

Webmaster's comment: Canaport LNG could not earn Shell a profit!

Update 2-LNG deal eases Repsol debt, boosts Shell position — Reuters UK

Under the deal, Shell has committed to continue supplying Canaport with just 0.1 million tonnes a year of LNG over a period of 10 years, enough to keep the terminal ticking over, but little more. [Red, yellow & bold emphasis added.]

Webmaster's comment: It appears that Canaport LNG is barely alive! Perhaps Downeast LNG should buy it, since Downeast LNG is bent on self-destruction, anyway!

Repsol sells package of LNG assets to Shell to cut its debt and hold to credit rating (Feb 27) — MercoPress, Montevideo, Uruguay

[This article also appears under the Caribbean heading, below.]

Repsol is selling Shell its minority stakes in Atlantic LNG, based in Trinidad and Tobago, Peru LNG and Spain’ss Bahia de Bizkaia Electricidad.

Tanker ships associated with those assets are also part of the deal, but Repsol's re-gasification plant in Canada was ultimately excluded and Shell is to supply the Canaport facility with one million tons of LNG over the next 10 years. Apparently Canaport failed to attract interest because booming US gas production has eroded its value. [Red, yellow & bold emphasis added.]

Webmaster's comment: Canaport LNG has been doing poorly, as have Everett LNG, and all US LNG import terminals.

Repsol to hang on to Canaport LNG, signs 10-year supply deal with Shell — Winnipeg Free Press, Winnipeg, MB

CALGARY - Repsol is hanging on to its interest in the Canaport LNG facility, which was left out of a $6.7-billion asset sale to Royal Dutch Shell announced Tuesday, because low natural gas prices prevented it from fetching a fair price.

Canaport is something of an anomaly in the North American market these days, with many companies rushing to export domestic liquefied natural gas supplies abroad, rather than import the fuel from overseas. [Red, yellow & bold emphasis added.]

Webmaster's comment: "Hangs onto" is hardly the case. "Couldn't get rid of" is a more accurate term. And, "anomaly" is an understatement. Downeast LNG is an even greater "anomaly" — more correctly referred to as a fortune-sinking boondoggle.

Passamaquoddy Bay & Maine

Baldacci expresses concerns about Searsport LPG tank plans (Feb 25) — MPBN

Opponents of a proposed 14-story, liquid propane gas storage tank in Searsport are hoping former Gov. John Baldacci will influence members of the local planning board to turn against the project. Contrary to some reports making the rounds in the community, Baldacci says he never told the Denver-based DCP Midstream energy company that he supported their project. In fact, Baldacci is expressing some reservations about the plan, and is urging community leaders to place a priority on public safety, as they consider the company's proposal. A.J. Higgins has more.

...Baldacci says he never endorsed DCP's eventual plans to build an LP storage tank the size of the Statue of Liberty. And he told the Searsport Planning Board as much in a recent letter.

In the letter dated Jan. 29, the former governor says that while he had reached out to DCP to obtain more LP gas for Maine in 2007, no one from that company had ever discussed plans about an LP gas import terminal or storage tank facility. He urges the planning board to keep safety and the public's well-being in mind above all other considerations as they weigh DCP's proposal.

"I felt that we should be moving away from that as a source, and that we should be working towards other types of fuels that were more readily available and more affordable," Baldacci said.

Peter Taber, a Searsport resident opposed to the storage tank, says he's glad that Baldacci, who is weighing a possible Democratic run for the Blaine House next year, has responded.

Webmaster's comment: Former Gov. Baldacci actively supported and lobbied for LNG projects in Searsport and Passamaquoddy Bay. His claim, now, to be more concerned about public safety rings hollow — especially since he is looking for votes in his potential race again for Governor.

Caribbean

Royal Dutch Shell buys Repsol stake (Feb 27) — Trinidad Express Newspaper, Port-of-Spain, Trinidad and Tobago, West Indies

The company said yesterday it has struck a deal with Spain's Repsol SA to buy Repsol's liquefied natural gas assets in Trinidad and Tobago and Peru in a deal worth US$6.2 billion.

Repsol was a shareholder in Point Fortin-based Atlantic's four LNG trains. [Red & bold emphasis added.]

Shell buys Repsol’s LNG assets (Feb 27) — The Trinidad Guardian Newspaper, Port-of-Spain, Trinidad and Tobago, West Indies

Repsol has reached an agreement with Shell for the sale of its LNG assets for $6.7 billion, including minority stakes in Atlantic (T&T), Peru LNG, and Bahia de Bizkaia Electricidad, as well as the LNG sale contracts and time charters with their associated loans and debt. Excluding the financial leases and financial gross debt, the equity value of the assets included in the sale is $4.4 billion, generating a pre-tax capital gain of $3.5 billion for Repsol. [Red & bold emphasis added.]

Repsol sells package of LNG assets to Shell to cut its debt and hold to credit rating (Feb 27) — MercoPress, Montevideo, Uruguay

[This article also appears under the New Brunswick heading, above.]

Repsol is selling Shell its minority stakes in Atlantic LNG, based in Trinidad and Tobago, Peru LNG and Spain’ss Bahia de Bizkaia Electricidad.

Tanker ships associated with those assets are also part of the deal, but Repsol's re-gasification plant in Canada was ultimately excluded and Shell is to supply the Canaport facility with one million tons of LNG over the next 10 years. Apparently Canaport failed to attract interest because booming US gas production has eroded its value. [Red, yellow & bold emphasis added.]

Top

2013 February 22

Gulf of Mexico

LNG import facility loses approval amid fracking boom — Law 360 [Paid subscription]

Federal energy regulators on Thursday rescinded their authorization of a planned liquefied natural gas import facility on the coast of Texas, after the project’s backers said they were abandoning the project amid the domestic gas boom driven by hydraulic fracturing. [Red & bold emphasis added.]

Webmaster's comment: Is Downeast LNG reading the news?!!!

Cheniere: First LNG export facility to start in late 2015 — (Dow Jones Newswire) Fox Business

Cheniere Energy Inc. reiterated Friday it will be ready to begin producing liquefied natural gas at its terminal in Sabine Pass, La., in late 2015, a step that will lead to the first exports of natural gas extracted in the contiguous U.S.

The announcement underscores how Cheniere, the only company to possess the necessary government permits to export natural gas to countries not in free-trade agreements with the U.S., is on schedule with its first two processing units while government regulators pore over about two dozen permit applications from competing projects.

Cheniere said construction was about 20% complete on the first two Sabine Pass LNG processing units, known as trains.

FERC grants authority for Sabine Pass feeder pipeline — LNG Law Blog

Yesterday, FERC issued an order granting Cheniere Creole Trail Pipeline, L.P. authority to construct facilities to enable bidirectional natural gas flow on its pipeline system for the delivery of domestic gas to the Sabine Pass LNG Liquefaction Project for eventual export. [Red & bold emphasis added.]

British Columbia

LNG expansion will break government's own GHG law [Opinion column] — The Vancouver Sun, Vancouver, BC

Methane, a potent greenhouse gas with 105 times more warming impact than carbon dioxide leaks into the air from hydraulic shale gas wells.

In 2007 the Liberal government enacted the Greenhouse Gas Reduction Targets Act, which set out to address Global Warming by making it law that the province of B.C. achieve meaningful emissions reductions by 2020 and 2050 (interim targets in 2012 and 2016).

This new "Natural Gas Strategy" would make those targets impossible - in fact, would dramatically increase GHG emissions levels both in B.C. and globally. At a time when reductions are drastically needed, nothing rates as being more short-sighted than the Liberals' proposed cash grab. [Red & bold emphasis added.]

BC taints grand vision (Week of Feb 24) — Petroleum News, Anchorage, AK

[British Columbia Premier Christy Clark's] government issued two grand plans in February forecasting LNG exports could generate C$130 billion to C$260 billion in revenues over 30 years, assuming two large and three smaller-sized LNG plants, along with thousands of jobs.

But, just as quickly, Clark antagonized the industry by disclosing plans to impose a major tax on the exports of natural gas.

Peter Doig, a former financial analyst, told the Globe and Mail that British Columbia has suddenly swung from subsidizing road construction to stimulate natural gas activity to “biting the hand that’s going to feed” the province.

Media advisory- Hon. Jim Prentice, CIBC vice chairman, to speak at International LNG Conference in British Columbia — Yahoo Finance

In his remarks, Mr. Prentice will discuss what he believes are the key issues that need to be addressed to ensure Canada and British Columbia's success in the Liquefied Natural Gas market.

United States

U.S. lawmakers stand behind LNG exports — UPI

"Expanding market access to producers will not only result in a wealth transfer from foreign countries to U.S. households but it will also encourage greater exploration and production activity," the letter says. "This will grow the economy and create jobs."

Webmaster's comment: ...and use up our finite domestic natural gas resource faster, and generate more greenhouse gases now just when we need to reduce them.

LNG export supporter may be Energy Dept. candidate — Houston Business Journal, Houston, TX

Citing comment from “people familiar with the matter,” the WSJ said that nuclear physicist Ernest Moniz, one of President Barack Obama’s scientific advisers, is being considered to replace Energy Secretary Steven Chu, who is resigning.

While director of the Massachusetts Institute of Technology’s Energy Initiative, Moniz led a study that suggested the U.S. shouldn’t stand in the way of exporting natural gas.

Analysis-Europe trade deal no fast track to US gas export bonanza — Reuters UK

A free trade agreement between the United States and Europe could open new markets for domestic natural gas, but without access to big growth Asian markets there still may not be enough demand to launch the export revolution that the industry desires. [Red & bold emphasis added.]

Webmaster's comment: The LNG industry may be making the same mistake they made with the mad rush to build LNG Import terminals.

Natural gas: Transport or export? [Investment opinion] — Seeking Alpha

I believe the main reason natural gas transportation is not supported by the US government is campaign financing. In 2010, the U.S. Supreme Court, in one of its worst decisions ever (Citizens United), ruled not to limit corporate campaign contributions. As a result, Congress does not craft energy policy on the basis of what is best for middle-class Americans (as it should). Rather, policies are implemented on the basis of what is best for the companies that bankroll Congressional re-election campaigns.

As a result, Exxon Mobil is very likely to end up exporting vast amounts of natural gas from the United States. Indeed, Golden Pass Products LLC has already received approval to export LNG. Golden Pass is a joint venture between XOM and Qatar. It will add 15.6 million metric tons of annual export capacity to the existing Golden Pass LNG import terminal in Texas. [Red & bold emphasis added.]

Mexico

Mexico may get spot Peru LNG as ship arrives at Manzanillo — Bloomberg Businessweek

The Ribera Del Duero Knutsen, with a capacity of 173,400 cubic meters, is scheduled to arrive at Manzanillo LNG terminal on Mexico’s west coast, according to ship transmissions captured by IHS Inc. (IHS) on Bloomberg. The tanker sailed from Peru LNG’s terminal at Pampa Melchorita, where it loaded its cargo and departed Feb. 15.

Mexico doesn’t have any term LNG supply contracts with Peru, according to data compiled by Bloomberg.

Top

2013 February 21

New Brunswick, Maine, and New England

Natural gas outlook: Prices up, storage declines — Dairy Herd Network

Percentage of New England natural gas consumption from Canaport and Everett LNG sendout less than half of levels last winter.

The average percentage of daily natural gas consumption in New England that was met with combined liquefied natural gas (LNG) sendout from the Distrigas of Massachusetts import and regasification facility located in Everett, Massachusetts and the Canaport LNG facility in New Brunswick, Canada through February 20 of the current winter season is less than half of the percentage through February 20 of the previous winter season, according to calculations with estimates from BENTEK Energy, LLC (Bentek). From November 1, 2011 through February 20, 2012, average sendout from the Everett and Canaport terminals was 15.8 percent of average daily consumption in New England, versus an average of 7.4 percent of daily consumption in New England between November 1, 2012 and February 20, 2013, according to the Bentek estimates. By comparison, LNG sendout met over 25 percent of New England’s average daily natural gas demand from November 2010 to January 2012.

...LNG sendout from Canaport has fallen by 41.9 percent, from 0.39 Bcf/d to 0.23 Bcf/d, while sendout from Everett has fallen by 69.7 percent, from 0.22 Bcf/d to 0.07 Bcf/d. [Red, yellow & bold emphasis added.]

Webmaster's comment: Wow! What could Downeast LNG's Dean Girdis and investors possibly be thinking — how to be the Biggest Loser?!!!

Gulf of Mexico

FERC vacates Calhoun LNG import terminal authorization — LNG Law Blog

FERC issued an order today granting Calhoun LNG's request to vacate its authority to build an LNG import terminal at the Port of Port Lavaca-Point Comfort in Calhoun County, Texas, and the interconnected pipeline. In its request to vacate the authorization, Calhoun LNG stated that it had abandoned plans to construct and operate the proposed facilities due to changed market conditions. [Red & bold emphasis added.]

Webmaster's comment: Another permitted LNG project bites the dust. Is Downeast LNG paying attention?

Energy regulators cancel Texas LNG import terminal authorization — Reuters

In 2007, the U.S. Federal Energy Regulatory Commission (FERC) authorized Calhoun to build and operate a terminal and associated infrastructure that would regasify up to 1 billion cubic feet of natural gas per day. The 2007 authorization required that the facilities begin service within five years of the final approval, which would have been by Sept. 20, 2012.

On Dec. 14, 2012, Calhoun LNG filed to vacate the authorization, saying it was abandoning its plans for the facility located in Port Lavaca, Texas, the FERC said in its filing on Thursday.

The tides turned for U.S. LNG import terminal projects after drilling technologies allowed domestic gas producers to unlock vast amounts of the fuel over the last five years, all but canceling the need for gas imports.

Companies that invested in LNG import terminals have been applying to convert them to export facilities as sharply higher domestic production has depressed local prices. Global demand is strong and LNG can at times fetch six times the amount paid in the United States. [Red, yellow & bold emphasis added.]

Webmaster's comment: Downeast LNG's investors, Kestrel Energy Partners, xxx, and York Town Energy Partners continue to foolishly throw good money after bad on a hopeless project.

Caribbean

Dominican Republic to get LNG cargo from Trinidad — LNG World News

Trinidad and Tobago shipped an LNG cargo from the Point Fortin terminal to the Dominican Republic on Tuesday, according to shipping data.

The cargo is being carried by the British Emerald, an 151,945 cubic-meter tanker and it is due to arrive at the AES Andres LNG terminal today.

Alaska

North Slope producers update Parnell, legislators on gas pipeline — Alaska Journal of Commerce, AK

North Slope producers have provided a few more details of their plans for a large Alaska gas pipeline and liquefied natural gas project and briefed state legislators in Juneau Feb. 19.

Much of what was in the letter sent to Parnell Feb. 15 has been known, but the companies added important new details, including that a 42-inch pipe diameter has been decided on. Also, the acreage needed for a liquefied natural gas (LNG) plant at the southern end of a gas pipeline was larger than the acreage in a project outline issued last October.

British Columbia

British Columbia targets LNG export tax amid industry pushback — ICIS, London, England, UK

"The exact means of how the BC government will collect new revenue from LNG profits has yet to be finalised."

United States

Japan Prime Minister to ask Obama for shale exports — Fuel Fix

The request will be made at a meeting tomorrow between Abe and Obama in Washington, said three Japanese officials, who declined to be identified because the information isn’t public. The bill for importing liquefied natural gas, combined with a weaker yen, prompted Japan to post a record trade deficit in January of 1.63 trillion yen ($17.4 billion), the Finance Ministry said yesterday.

Importing U.S. gas would boost Japanese utilities’ bargaining power in negotiations with suppliers who benchmark their prices against more-expensive oil, said Reiji Ogino, an analyst at Mitsubishi UFJ Morgan Stanley Securities Co. Utilities have sought government approval to raise electricity prices and pass on the burden of higher fuel bills to consumers.

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2013 February 20

Nova Scotia

Pieridae Energy opens office in Halifax, Canada (Feb 19) — LNG World News

Goldboro LNG will include a natural gas liquefaction plant and facilities for the storage and export of liquefied natural gas (LNG), including a marine jetty for loading. The project will create significant direct and indirect economic benefits for the local community, province and region.

Webmaster's comment: One wonders how Goldboro LNG and regulators intend to deal with the numerous residents whose homes fall within the (US Department of Energy-defined) 2.2-mile Hazard Zone that accompanies LNG ships.

Gulf of Mexico

LNG expansion planned in Hackberry — KPLC-TV, Lake Charles, LA

One project involves an expansion by Cameron Liquefied Natural Gas (LNG), LLC. Sempra Energy of San Diego is investing in the expansion.

"What they're looking at doing is changing from an import facility alone to an import and export facility," said Bill Rase, executive director of the Port of Lake Charles. [Red & bold emphasis added.]

Webmaster's comment: As with most existing US LNG import terminals, lack of demand for imported LNG has resulted in Cameron's proposal to add liquefaction and export capability.

Alaska

USA: Governor Parnell welcomes Alaska LNG progress — LNG World News

Executives from BP, ConocoPhillips, ExxonMobil, and TransCanada submitted a letter, meeting Governor Sean Parnell’s benchmarks for gas pipeline progress. The companies’ letter states the concept selection phase for an Alaska liquefied natural gas (LNG) project has been completed.

British Columbia

Editorial: Victoria provides few details — Vernon Morning Star, Vernon, BC

Rather than convince the province with reasoned arguments that LNG exports would be safe and profitable despite the vagaries of the volatile fuel market, the throne speech instead held out tantalizing, but unsubstantiated hints about what could be done with all that money. Reducing the provincial debt topped the list, along with improvements to social services, investment in education and infrastructure, and the biggest carrot, the elimination of provincial sales tax.

Webmaster's comment: LNG developers wave so many dollars are waved under the public's noses that the public goes snow-blind.

LNG project plans clouded as B.C. mulls new export tax (Feb 19) — The Globe and Mail, Toronto, ON

The British Columbia government will take another year to finalize details of its proposed tax on exports of liquefied natural gas, casting uncertainty over the fledgling industry just as it contemplates major new investments.

LNG projections too high: Expert (Feb 19) — (The Canadian Press) Nanaimo Daily News, Nanaimo, BC

The report said B.C.'s natural gas revenue projections have been overstated in five of the last eight years and O'Neill suggested extra caution is needed when factoring those revenues, especially since natural gas prices are at record lows.

MLA report: Liberals not dealing with the here and now [Political opinion] (Feb 19) — Campbell River Mirror, Campbell River, BC

I am sure most people agree that establishing a savings fund is not a bad idea - but this one will be created when there will be no money to put into it for many years. That’s because there is no LNG industry in BC; the major players in that industry have not even committed to the billions of dollars required just to create the LNG plants.

Currently the gas and oil industry is asking the federal government to give them two billion dollars in tax breaks. Why would Ottawa do that if BC grabs the tax instead?

Canada

US LNG export capacity seen at 70 billion cu m/year by 2020: Goldman Sachs — Platts

[This article also appears under the United States heading, below.]

The US likely would build liquefaction capacity totaling 70 billion cubic meters/yr (6.77 Bcf/d) between 2016 and 2020, according to Goldman Sachs analysts.

The analysts, in a report issued late Tuesday, also predicted that 48 billion cu m/yr of liquefaction capacity would be added in Canada, as well as 21 billion cu m/yr potentially at a planned Mozambique project by 2022. [Red & bold emphasis added.]

United States

Nigeria's LNG exports to US in steep decline on rise of shale: NNPC — Platts

"In 2011, Nigeria exported just 2.3 Tcf, representing 1% of total LNG exports to the US, compared with about 12% in 2007," NNPC said in the report. Nigeria exported 95 Tcf of LNG to the US in 2007, according to the report.

[T]he new NNPC data projects Nigeria's LNG exports to shrink further given the steady increase in shale gas' share of total US gas supply from 8% in 2007 to 32% in 2011 and to the US becoming a net exporter of natural gas this year. [Red & bold emphasis added.]

Webmaster's comment: Nigeria's LNG exports to the US have fallen 91.7% over the past year.

US LNG export capacity seen at 70 billion cu m/year by 2020: Goldman Sachs — Platts

[This article also appears under the Canada heading, above.]

The US likely would build liquefaction capacity totaling 70 billion cubic meters/yr (6.77 Bcf/d) between 2016 and 2020, according to Goldman Sachs analysts.

The analysts, in a report issued late Tuesday, also predicted that 48 billion cu m/yr of liquefaction capacity would be added in Canada, as well as 21 billion cu m/yr potentially at a planned Mozambique project by 2022. [Red & bold emphasis added.]

PDF file2012 Year in Review — NGI's Shale Daily

[The above link will download a PDF file; 2.9 MB]

"The report issued by the DOE on...LNG exports is flawed, misleading and based on outdated, inaccurate and incomplete economic data," [Dow Chemical CEO Andrew Levris] said. "The report fails to give due consideration to the importance of manufacturing to the U.S. economy. Manufacturing is the largest user of natural gas in the U.S. and creates more jobs and more value to the U.S. economy from natural gas than any other sector."

Liveris took out his calculator to make his point. "The value of every unit of energy used by the manufacturing sector is multiplied by as many as 20 times from the production of thousands of highvalue products though the value chain," he said. "Compare this to the one-time value created by exporting energy as liquefied natural gas. Furthermore, for every manufacturing job created on the factory floor, five to eight more are created in the larger economy."

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2013 February 19

Nova Scotia

Proposed developer of Goldboro LNG sets up shop in Halifax, hires staffers — The Chronicle Herald, Halifax, NS

The company that wants to export liquefied natural gas from Goldboro to the world announced the opening of a Halifax office on Tuesday.

Brown has about 30 years experience in the North American and international energy industry. Besides his role in the development of the Canaport LNG facility, he was involved in the previous Maple LNG facility proposed for Goldboro.

“The Goldboro LNG proposal allows us to take advantage of the current abundance of natural gas in North America and export it from Nova Scotia,” he said. [Red, yellow & bold emphasis added.]

Webmaster's comment: It's worth noting that both LNG projects that Goldboro LNG Director of Project Development Mark Brown previously worked on are not exactly shining examples of success: although it was constructed, Canaport LNG is doing poorly as an import terminal, and Maple LNG was never realized.

The LNG industry continues to throw a lot of money down unproductive bottomless holes — including the investors of ever-flawed Downeast LNG.

Caribbean

OUR reviewing electricity generation proposals — Jamaica Observer, Kingston, Jamaica, West Indies

The Office of Utilities Regulation (OUR) last night opened a window of opportunity for firms wishing to submit proposals for a new electricity generating plant that would use liquefied natural gas (LNG) as its main fuel source.

[Jamaica Public Service President and CEO Kelly Tomblin] said that, despite her company's best efforts, the market is not supporting earlier estimates of LNG prices as low as $8.50 mmbtu. "We have received indicative prices of upwards of $12.50 mmbtu for LNG and the related infrastructure, which we estimate would result in a reduction of approximately 20 per cent in electricity costs," she explained.

"A meeting was held with JPS, following which the OUR informed the company that it would be allowed to submit the details of what is now considered an unsolicited proposal. The OUR will only entertain firm proposals in a state of readiness to be finalised with minimal negotiations. The proposals must be to provide electricity only and must be accompanied by the relevant fuel supply and other financing agreements," the regulatory agency said.

British Columbia

Pacific Northwest LNG project - Public comments invited [Press release] — CNW (Canadian Newswire)

OTTAWA, Feb. 19, 2013 /CNW/ - As part of the strengthened and modernized Canadian Environmental Assessment Act, 2012 (CEAA 2012) put in place to support the government's Responsible Resource Development Initiative, the Canadian Environmental Assessment Agency must decide whether a federal environmental assessment is required for the proposed Pacific Northwest LNG Project in British Columbia. To assist it in making its decision, the Agency is seeking comments from the public on the project and its potential effects on the environment.

Progress Energy Canada Ltd. is proposing to construct and operate a liquefied natural gas (LNG) facility and marine terminal near Prince Rupert, within the District of Port Edward. The Pacific Northwest LNG facility would be located on Lelu Island. The proposed project would convert natural gas to LNG for export to Pacific Rim markets in Asia.

Written comments must be submitted by March 11, 2013 .... [Red & bold emphasis added.]

MP doubtful all LNG terminals will proceed — The Northern View

While there may be five LNG terminals proposed for the north coast, including three in Kitimat and two in Prince Rupert, Skeena – Bulkley Valley MP Nathan Cullen said he doubts five terminals will be built.

California

Thomas D. Elias: Fracking vs. impact on state's natural gas [Commentary] (Feb 18) — Appeal-Democrat, Marysville, CA

California could have three or more facilities receiving liquefied natural gas today, but for massive popular resistance to the prices and possible dangers they might have brought. If those plants had been built, the phenomenon of fracking would mean something very different than it now does.

Over the last 10 years, potential liquefied natural gas sites were killed in locales as varied as Humboldt Bay near Eureka, north San Diego County, Santa Monica Bay, Ventura County and Long Beach.

Because of populist resistance, the multi-billion receiving plants and their attendant fleet of equally pricey tankers do not now exist. But such plants and ships were imposed on other parts of the country, most notably the Gulf Coast and Eastern Seaboard.

Now many of those importing facilities are hastily being converted into liquefaction plants that will soon export the ultra-cold and highly volatile gas rather than bringing it in. [Red & bold emphasis added.]

Hawaii

PDF fileEnergy Infrastructure Update for January 2013 — FERC Office of Energy Projects

[This article's link will access a PDF file; 127 KB; This same article appears under the United States heading, below.]

By order dated January 17, 2013, the Commission dismissed The Gas Company’s Section 3 request to construct and operate mobile LNG vaporization/regasification units and storage facilities in HI. The Commission dismissed the request because the project did not constitute an LNG facility as envisioned under Section 3 and does not require any other authorization from the Commission.

Webmaster's comment: There were no new LNG import or export facilities placed in service or certified through January 31, 2012.

United States

LNG-watchers expect Obama, Japan PM to discuss potential exports this week — Platts

The looming decision on expanding US liquefied natural gas exports will likely be on the agenda during this week's meeting between Japanese Prime Minister Shinzo Abe and President Barack Obama, industry observers said Tuesday.

Webmaster's comment: The "LNG watchers" / "industry observers" mentioned in the article are all LNG-export advocates. More acturately than the article expresses it, they "hope," rather than "expect."

PDF fileEnergy Infrastructure Update for January 2013 — FERC Office of Energy Projects

[This article's link will access a PDF file; 127 KB; This same article appears under the Hawaii heading, above.]

By order dated January 17, 2013, the Commission dismissed The Gas Company’s Section 3 request to construct and operate mobile LNG vaporization/regasification units and storage facilities in HI. The Commission dismissed the request because the project did not constitute an LNG facility as envisioned under Section 3 and does not require any other authorization from the Commission.

Webmaster's comment: There were no new LNG import or export facilities placed in service or certified through January 31, 2012.

U.S. LNG exports: Increasingly a reality — Seeking Alpha

The aggressive marketing of LNG liquefaction capacity by the U.S. projects spells bad news (and shrinking operating margins) for global LNG trade in general. With the availability of Henry Hub linked LNG imports on the horizon, oil-based LNG pricing in Asia - the major pivot of profitability for merchant cargoes and proposed LNG developments around the world - may no longer be feasible within a few years. Henry Hub may in fact become a new price-setting reference point for the global natural gas trade, impacting exporters from Australia to Russia. [Red & bold emphasis added.]

How fracking weakens Gazprom, the bedrock beneath Putin’s feet (Feb 18) — The Globe and Mail, Toronto, ON

Five years ago, Gazprom was close to shipping gas from Russia’s Eastern Arctic to the United States. No longer. Thanks to fracking, the United States has so much shale gas it will soon be a gas exporter, and many other countries, including Qatar and Australia, are exploiting their LNG potential as well.

Russia and Gazprom also had high hopes of selling gas to China, through yet more lengthy pipelines. But that looks less likely as China considers other options, including developing its own shale gas or taking LNG deliveries from other countries, including the United States. [Red & bold emphasis added.]

Webmaster's comment: Gazprom and Downeast LNG cannot seem to understand the changed natural gas market.

Tepco's US LNG agreement: Small volumes, big deal — AOL Energy

Japan's recent deal to import US LNG at Henry Hub benchmark prices appears largely symbolic, but is important for the sector as it could represent the beginning of a larger trend away from oil-linked LNG prices for the world's largest LNG importer.

"They [the deal's negotiators] were very surprised they were able to pull it off," a source familiar with the negotiations recently told AOL Energy.

This would be the fist time the HH benchmark would be applied to the price index of a Tepco long-term LNG contract, which makes the announcement significant despite the relatively small volumes being negotiated. [Red & bold emphasis added.]

US energy lobby opposed to shale gas exports, India optimistic of supplies — The Pioneer, India

The Government's ambitious move to facilitate shale gas exports from the US seems to be facing serious impediments within that country as according to top official sources a strong energy lobby consisting mainly of America's domestic petrochemical sector has been making efforts to thwart the Obama Administration from allowing movement of the environment-friendly gas to New Delhi.

On the other hand the Indian Government has expressed that it is “quite keen” that shale gas exports from the US happen as soon as possible as it is an environment-friendly mode of energy. In fact Indian official circles are optimistic of a smooth resolution of the matter and this optimism stems from the fact that Petroleum Minister M Veerappa Moily has just come back from a 10-day tour of the US where he even visited some of the shale gas blocks.

Top sources in the Petroleum Ministry said that America's energy sector mainly the petrochemical lobby has been trying hard to block any intention of the US Government to export shale gas to India and other nations with which it does not have a FTA understanding.

US natural gas exports could spur manufacturing — The Energy Collective

...Purdue University released a comparison of studies on economic impacts of natural gas exports that supports keeping LNG in the United States....

It is clear that policy makers need to be very careful in approving US natural gas exports. While we are normally disciples of the free trade orthodoxy, one must examine the evidence in each case. We have done that, and the analysis shows that this case is different. Using the natural gas in the US is more advantageous than exports, both economically and environmentally. [Red & bold emphasis added.]

LNG expected to drive pipeline construction demand — Houston Business Journal, Houston, TX

New oil and gas gathered at shale plays already is spurring a huge boom for pipeline construction companies — and if the U.S. government permits more companies to export liquefied natural gas, pipeline construction companies could hit new highs.

Increasing LNG exports is right for America [Pro-Oil & Gas industry lobbying letter] — Energy Nation

[This is a Big Oil & Gas effort to get federal legislators to rush to increase LNG exports.]

As a member of the oil and natural gas industry, I want to express my support for increasing liquefied natural gas (LNG) exports because it will create more American jobs and strengthen the U.S. economy.

Mexico

Peru ships LNG cargo to Mexico — LNG World News

The 173,000 m3 Ribera del Duero Knutsen departed from the Peru LNG terminal on February 16, and it is due to arrive at Mexico’s Manzanillo terminal on February 22.

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2013 February 18

Northeast

Process under way to determine how to demolish Staten Island LNG tanks (Feb 17) — Staten Island Advance, Staten Island, NY

The hulking, rusted, empty liquefied natural gas (LNG) tanks that dominate the Rossville horizon have been little more than a horrible blight to the South Shore landscape for nearly four decades.

In 1998, the cost of demolition was estimated at $8 million to $12 million. Dmytryszyn said that that number would easily be $24 million or more today.

Webmaster's comment: These LNG storage tanks were not related to an LNG import terminal; however, this article indicates the complicated and expensive requirements for LNG tank removal and environmental protection measures required during removal. Downeast LNG's unlikely proposed terminal would eventurally need to be removed, encountering these issues. Fortunately, Downeast LNG is chasing a phantom in its LNG terminal project.

Gulf of Mexico

Sabine Pass LNG export terminal construction continues — LNG Law Blog

On Friday, FERC granted Sabine Pass Liquefaction, LLC's request to commence installation of structural steel for Train 1, Train 2, and additional common areas for the Sabine Pass Liquefaction Project in Cameron Parish, La.

Alaska

Alaska set for LNG overhaul — UPI

Alaskan Gov. Sean Parnell welcomed commitments from major energy companies to build an 800-mile pipeline for a liquefied natural gas [export] project.

The underground pipeline would run from the North Slope of Alaska and would carry around 3 billion cubic feet of natural gas per day to facilities that would process LNG.

Companies propose 800-mile Alaska gas pipeline — Hydrocarbon Processing

Under the companies' plan, an 800-mile pipeline would be built with the capacity to ship 3 billion to 3.5 billion cubic feet of gas to an area near a port where the gas would be turned into a liquid. The LNG would be stored in tanks and loaded onto tankers from a loading jetty with two berths.

If built, the gas pipeline and export facility would be one of the largest LNG projects in the world, said Mr. Parnell, who has strongly supported development of Alaska's gas and a pipeline to ship the gas to overseas markets. As part of an agreement with the state, the companies promised to provide periodic updates on their pipeline-development plans.

British Columbia

British Columbia explores possible tax on future LNG exports — Platts

The Clark government, which is facing stiff opposition in its bid to retain power in a May 14 election, is counting on directing a minimum C$100 billion of LNG-related revenues into a newly-created B.C. Prosperity Fund that could eliminate the province's deficit, currently at C$58 billion, by 2028.

But analysts and industry leaders have cautioned the government against making financial assumptions if they are based on higher taxes and royalties. Gary Leach, president of the Explorers and Producers Association of Canada, said February 15 that any revenue projections stretched over several decades for any resource commodity would be highly speculative, given the uncertainties of future commodity prices, global economic growth -- especially in Asia -- and competing energy supplies.

Will Dix get gassed by Clark? [Opinion Column] — The Tyee, Vancouver, BC

You will remember when natural gas was such a bad polluter that it was declared off limits. Heaven help us if BC Hydro uses gas to fuel its generators a couple of times a year when BC Hydro's reservoirs are low but somehow this dirty pollutant becomes a friendly pal when it suits the government.

Along came "fracking" and by edict from the premier natural gas is no longer a nasty pollutant; it is lovely stuff if used it to make LNG.

B.C. gas boom is real, all right (Opinion column) — Merritt Herald, Merritt, BC

B.C. has never seen this kind of international investment interest before. Initial projects have been joined by global players such as British Gas, and Mitsubishi, a key player in Japan’s replacement of its devastated nuclear power program.

All this is happening as shale gas is developed across the United States as well. As with oil, Canada is a captive of the U.S. market, and the flood of new gas supply has the North American price at rock bottom.

Is natural gas B.C.'s future or a trillion-dollar pipe dream? [Commentary] (Feb 17) — The Province, Vancouver, BC

First we have to build pipelines to get the gas to Kitimat. Then we have to refrigerate the gas to -161 C so it liquefies, requiring a tonne of electricity we don't currently have. Then we have to ship it across the Pacific Ocean on tankers.

Australia is doing the same thing we're doing, and the United States is getting in to it too.

But the biggest competition may come from Asia itself, which is sitting on its own massive gas reserves.

Newly developed domestic supplies in Asia could deflate prices - and spoil the party here at home.

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2013 February 16

Canadian Maritimes, Maine & New England

Deep Panuke set to start in six months (Feb 14) — The Chronicle Herald, Halifax, NS

Production at the Deep Panuke natural gas project off Nova Scotia’s coast will begin in the next six months, the platform’s owners said Thursday.

Construction is “very close to being complete,” he added. “The biggest thing to approaching first gas is getting a lot of systems checked and commissioned.”

With four deep-sea wells, Encana has previously estimated the Deep Panuke could produce 300 million cubic feet of gas daily, with initial production of about 200 million cubic feet per day. [Red, yellow & bold emphasis added.]

Webmaster's comment: All of Deep Panuke's output has been purchased by Repsol (the same Spanish company that owns 75% of Canaport LNG in Saint John, NB), and will be transported to customers via the Maritimes & Northeast Pipeline. Deep Panuke will be outputting natural gas just as Sable Island's offshore natural gas production is in decline — essentially replacing Sable Island's production.

Downeast LNG likes to claim that its proposed project is needed because Sable Island's offshore natural gas well production is in decline. Deep Panuke's upcoming new production impeaches Downeast LNG's disingenuous claim.

How LePage plans to fast-track natural-gas expansion (Feb 15) — Bangor Daily News, Bangor, ME

AUGUSTA, Maine — In his State of the State address, Gov. Paul LePage committed to “fast track” permitting for the state’s natural gas delivery infrastructure in the same way his predecessor, Gov. John Baldacci, did for wind power projects.

The Republican governor’s proposal was more than just a jab at his Democratic predecessor and potential gubernatorial campaign rival in 2014. It derives from LePage’s commitment to position Maine businesses to participate in what Patrick Woodcock, director of the governor’s energy office, described as a transformational rebirth of U.S. manufacturing fueled by low-cost natural gas.

Addressing that demand, which analysts expect to heighten as more homes and electricity power plants convert to natural gas, will require new pipelines that deliver natural gas from the south as far north as Maine.

LePage administration officials are discussing with other New England governors and Canadian provincial leaders ways to facilitate that type of construction, Woodcock said. At present, the major pipelines that deliver natural gas to Maine flow south from the Maritime provinces, and a decrease in production at the Sable Offshore Energy Project off the coast of New Brunswick elevates the importance of improving delivery from the south.

Woodcock said the LePage administration believes that’s a decision best left to the governments of states where fracking occurs, and desRosiers observed that federal regulators, recognizing the importance to the U.S. economy of domestic natural gas production in reducing dependence on foreign oil, will ensure that “there will be a significant supply for a good long while.”

Webmaster's comment: Perhaps unintentionally, Gov. Lepage is also jabbing former Gov. Baldacci's flagrant advocacy and support for building unnecessary, counterproductive LNG import terminals in Maine.

NSP not interested in importing LNG (Jan 2) — The Chronicle Herald, Halifax, NS

[Nova Scotia Power] recently told the provincial regulator that it does have an option to acquire LNG imports but isn’t using it.

Nova Scotia Power, which uses natural gas at its Tufts Cove plant in Dartmouth, also told the provincial regulator that LNG supply is constrained because the Canaport LNG terminal in Saint John, N.B., isn’t importing much of it.

“Until the price of gas rises in the Maritimes or falls in Europe and Asia, it does not make economic sense to import LNG to North America,” the utility said in the filing.

An LNG export facility proposed for Guysborough County could also have an impact on the market and not necessarily a positive one, the utility said in a separate filing. [Red, yellow & bold emphasis added.]

Webmaster's comment:

  1. Canaport LNG is doing poorly, importing little LNG.
  2. North American natural gas is cheaper than LNG imported from overseas.
  3. There is a proposal to export LNG from Nova Scotia, by reversing direction of natural gas in the Maritimes and Northeast Pipeline.
  4. Canaport LNG's flagging business has prevented Repsol from selling its LNG assets as a single block.
  5. There are suggestions that Canaport LNG should be converted to an export terminal.
  6. Maine state government is pressing hard to expand natural gas pipelines to deliver more of the prolific domestic natural gas supplies to New England and Maine.

Downeast LNG investors Kestrel Energy Partners, Paul A. Vermylen, Jr., and York Town Energy Partners have all got to be kicking themselves in the head, asking themselves why they let Downeast LNG president Dean Girdis talk them into investing in such a pointless proposal.

United States

Democrats should support the natural-gas boom [Opinion] — (The Washington Post) Bangor Daily News, Bangor, ME

The president is right. The United States sits atop seas of natural gas, a fuel that drives electric turbines, warms homes, heats water and even powers some big trucks. Much of this gas is in unconventional deposits that drillers have only begun to tap. Now that they have, the price of the fuel has plummeted and the United States has gone from a gas importer to a potential exporter, with decades of supply left.

...

The president’s approach is better. While praising the energy boom for all its benefits, he has also concluded that reasonable new regulations could make extracting gas much cleaner, and his administration has gone about writing them. One of them, from the EPA, would require that drillers prevent pollutants from escaping into the air during extraction, addressing one of the activists’ primary criticisms. More Democrats should take after their leader. [Red & bold emphasis added.]

Webmaster's comment: Everyone should support renewable energy.

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2013 February 15

Gulf of Mexico

Brazil may get spot LNG from U.S. as ship arrives at Pecem — Bloomberg Businessweek

Petroleo Brasileiro SA (PBR) may receive a spot cargo of liquefied natural gas from the U.S. today, according to ship-tracking data.

Jean Abiteboul, Cheniere’s London-based president of supply and marketing, confirmed that the LNG Capricorn loaded at Sabine Pass in December in an e-mailed response to questions.

Caribbean

GAIL places non-binding bid for Repsol LNG asset — Reuters India

State-run gas transmission company GAIL), in a tie up with EDF, has placed a non-binding bid for Repsol's LNG assets in Trinidad and Tobago, the Indian company's chairman said on Friday.

Webmaster's comment: Note that GAIL's bid does not include any offer on Canaport LNG. See yesterday's Bloomberg article, "Repsol LNG sale seen delayed as shale goring Canaport," regarding how Canaport LNG's decline has foiled Repsol's block sale of its LNG assets.

GAIL bids for Repsol's Atlantic LNG — DNA (Daily News & Analysis), Mumbai, India

Repsol, Spain’s biggest integrated oil and gas player, is currently saddled with a massive debt burden and has been looking to sell its stake in the profitable Atlantic project since last year. It is also hiving off other LNG projects in Canada and Peru at a total valuation of $2 billion – including the Atlantic project – but has met with no success because of regulatory issues.

Analysts did not attribute much value to the news, saying it would be a long time before bids are finalised. Besides, going by international media reports, GAIL is pitted against energy giants such as China’s Sinopec, Russia’s Gazprom and France’s GDF Suez (in consortium with China’s sovereign wealth fund CIC). [Red & bold emphasis added.]

Webmaster's comment: This bid does not include Canaport LNG.

GAIL, EDF bid for Trinidad and Tobago assets of Repsol — The Hindu, Chennai, India

GAIL (India) and U.S. arm of France’s EDF group have placed a joint bid to acquire some of Spanish energy company Repsol SA’s LNG assets in Trinidad and Tobago.

Repsol has put on sale its gas assets in Canada, Peru and Trinidad & Tobago.

Webmaster's comment: This offer does not include Canaport LNG.

Gail and EDF bid for Repsol’s LNG assets in Trinidad and Tobago — Financial News, UK

Oil and gas group Repsol, looking to cut its heavy debt, started the sale of LNG interests in July 2012, including 75% stake in a regasification facility in Canada, 20% in a liquefaction plant in Peru and a 23% in the Atlantic liquefaction plant in Trinidad and Tobago.

In September last year, Reuters cited sources as saying that Repsol had received six offers for the LNG operations.

Webmaster's comment: The Gail and EDF offer does not include Canaport LNG.

Alaska

North Slope producers update Parnell on gas pipeline — Alaska Journal of Commerce, Anchorage, AK

The state Legislature is now considering a bill, proposed by Parnell, that would restructure and reduce state oil taxes. Parnell has promised to introduce legislation on natural gas taxes next year if the companies continue to show progress on the pipeline and LNG project.

The current plan, outlined in the [developers'] letter, is to build a 42-inch diameter pipeline that would move 3 billion to 3.5 billion cubic feet a day of gas to a liquefaction plant in a southern Alaska port city, the letter said.

A large LNG plant would be built with three trains capable of producing 15 to millions tons per year of LNG. A 400- to 600-acre site would be needed for the plant, which would also require two LNG storage tanks capable of storing 160,000 cubic meters per tank. There would be one loading jetty with two berths, the letter said.

[Governor] Parnell had also hoped that the companies would include their preferred location for a south Alaska pipeline terminus and LNG plant location, but that information was not given.

British Columbia

LNG warning flags; Canada’s First Nations ponder legal fight (Week of Feb 17) — Petroleum News, Anchorage, AK

The message from aboriginal communities is starting to gain momentum and attention.

The Carrier Sekani Tribal Council, CSTC, a coalition of eight First Nations whose territorial land covers the bulk of the pipeline rights of way to carry natural gas to liquefaction plants on the Pacific Coast, said that unless it is consulted and involved in the approval process it will not allow those pipelines to go ahead.

Separately, the Fort Nelson First Nation, in the heart of massive shale gas deposits in the Horn River formation of northeastern British Columbia, is ready to engage in a legal fight over the use of hydraulic fracturing to extract shale gas and the associated pipelines.

Teegee said “we are raising the alarm that (the LNG) projects are at risk. While there have been some initial discussions with CSTC and our member First Nations there are no agreements in place for our First Nations to review or understand the cumulative impacts of these projects.”

Ewart: Honeymoon over for B.C. LNG as new tax looms — Calgary Herald, Calgary, AB

It appears the honeymoon is quickly coming to an end for the LNG business in British Columbia as the tough sledding begins in the marriage between industry and government.

In the throne speech to open the legislature this week, B.C. Premier Christy Clark's government revealed it will add a tax on exports of liquefied natural gas to generate $100 billion over 30 years for a provincial "prosperity fund" similar to Alberta's Heritage Savings Fund.

The industry isn't happy. In fact, it's already crying poverty.

The B.C. announcement came less than a week after a Vancouver Sun report that LNG producers have asked the federal government for $2 billion in annual tax savings to support development of the 10 LNG plants on the drawing board for Kitimat and Prince Rupert. [Red & bold emphasis added.]

Premier's LNG policy Swiftian, not swift — The Vancouver Courier, Vancouver, BC

So Premier Christy Clark is pinning B.C.'s economic prospects on liquefied natural gas, with billions of dollars of extra revenue projected for the 2020's. Meanwhile, the Canadian oil and gas lobby is asking Ottawa for subsidies that may add up to $2 billion in tax savings. This will supposedly encourage the development of LNG plants in British Columbia.

Once more, the so-called free market - an oligopoly, actually - somehow can't seem to function without wringing special concessions from government. David Collyer, president of the Canadian Association of Petroleum producers, wants to see a change in the taxing structure for liquefied natural gas. Reclassifying LNG plants from gas transmission to manufacturing plants would result in a 30 per cent capital cost allowance when they are constructed. It will take only nine years to write off 90 per cent of the investment, rather than 27 years. [Red & bold emphasis added.]

Peril or promise of LNG [Commentary] (Feb 14) — The Nelson Daily, Nelson, BC

Labelled a “generational opportunity,” this commercialization is more nightmare than dream.

Our governments – in collusion with the fossil fuel industry – operate on the Drill Baby Drill dictum. No thought is given as to what to do when the last drop has been drilled; there is no exit strategy.

Then there’s the fact we’re not the only horse in the race. A number of other countries are thinking just like we are with Australia – which already has secured contracts to sell LNG to China – as our chief competitor. [Red & bold emphasis added.]

B.C.’s environmental commitment running on gas fumes? (Feb 14) — Metro, Canada

British Columbia’s prophesized liquefied natural gas boon is likely a bust for the environment.

The David Suzuki Foundation says the government’s throne speech earlier this week – trumping $1 trillion in LNG-related economic activity over 30 years and more than 100,000 jobs – will sink B.C.’s commitment to cutting greenhouse gas emissions (GHG) by 33 per cent by 2020.

According to Ian Bruce, the foundation’s science and policy manager, exporting 1.9 trillion cubic feet of shale gas (as the government projects) annually once three proposed plans are online in 2020 would see GHG emissions increase by 27 per cent from today’s levels. [Red & bold emphasis added.]

Bob Simpson: LNG snake oil for B.C.’s economic woes [Commentary] — Georgia Strait, Vancouver, BC

Investing in LNG as the Liberals suggest will be bad for B.C.’s environment. Increasing our reliance on LNG means rapidly depleting a nonrenewable resource, permanently toxifying trillions of litres of fresh water every year, increasing the fragmentation of our land base, and releasing massive amounts of greenhouse gases into the atmosphere. These emissions will ensure we break B.C.’s law requiring us to reduce GHG emissions by 80 percent by 2050.

B.C. will be far too late into the Asian market to benefit from pricing premiums, which means that British Columbians will most likely end up subsidizing the industry instead of benefitting from it. We’ll also end up paying higher domestic prices for our own natural gas to boot. [Red & bold emphasis added.]

United States

Natural gas drilling = A future of dependence [Opinion Blog] — Huffington Post

Contrary to the folktales the gas companies spin, shale gas development is not about energy independence, increased jobs, or protection from climate change. Shale gas development is about profits for the gas companies regardless of the harms or costs to the United States of America and us as citizens. It's important not to be fooled by the rhetoric of the gas drilling industry.

Currently there are at least 15 applications for liquefied-natural-gas (LNG) export facilities pending before the federal government. These applications, along with already-approved exports, would have the capacity to move more than 40 percent of the U.S. annual production of natural gas to foreign countries. The gas companies want the exports overseas because they can sell the gas for as much as three times the price they can capture here in the U.S. At present there is a glut of gas in this country, so unless the industry sells it overseas the companies won't get their immediate cash sale reward. [Red & bold emphasis added.]

Commentary: US LNG export fight centres around non-FTA countries — ICIS, UK

US-based Dow Chemical and other chemical producers such as Eastman Chemical, want the US government to carefully evaluate applications by companies to export liquefied natural gas (LNG), considering the public interest, including the interest of consumers and industrial consumers.

Think again on US LNG [Commentary] — ICIS, UK

US LNG exports are unlikely to lead to a globalising of the natural gas price. There are significant costs of $6-8/MMBtu associated with liquefaction and transportation, as this table shows. These costs, according to ICIS Heren LNG analyst Simon Ellis "will lock in the competitive advantage enjoyed by the US because of this large fixed cost element." He adds: "US LNG exports might put a ceiling on global LNG prices but also have the potential to impose a substantial floor level, well above that paid by domestic gas buyers." [Brown & bold emphasis added.]

Webmaster's comment: Well, Japan has already succeeded in obtaining US Henry Hub-based pricing with two proposed US LNG exporters, and both Japan and Chile are hoping to obtain LNG from other sources at US-based prices. See the news articles on this topic under the Chile and Japan headings, below. Also, see Russia's contrary opinion under the Russia heading, below.


There were an inordinate number of news articles regarding non-North American and Caribbean countries involved with North American LNG issues. We do not normally include LNG articles outside of North America, the Caribbean, and Hawaii. — SPB webmaster


Panama

Panama Canal to become major LNG thoroughfare? — OilPrice.com

According to Panama Canal administrator Jorge Luis Quijano, the channel’s hottest commodity is likely to be U.S. liquefied natural gas shipments, along with rising commodity cargoes connecting the U.S., Latin America and Asia when the project is complete in two years’ time. According to Quijano, shipping containerized goods levels, which used to generate most business for the channel, has yet to return to 2007 level, the year the global recession began. [Red & bold emphasis added.]

Chile

Rpt-Interview-Chile hopes cheaper LNG to ease power crunch — Reuters UK

SANTIAGO, Feb 14 (Reuters) - A U.S. shale gas boom could help Chile avert a power crunch by lowering liquefied natural gas (LNG) prices, as the government is worried that troubled hydropower projects may never come on line, the deputy energy minister told Reuters on Thursday. [Red & bold emphasis added.]

Africa

Could East African gas impact U.S. liquified natural gas exports? — Brookings Institution

The hottest U.S. energy policy topic coming into 2013 is whether the administration should permit exports of liquefied natural gas (LNG). With the early December release of a Department of Energy-sponsored study examining the domestic economic impact of LNG exports, the debate has intensified and the stage is set for a decision sometime in 2013.

One of those market forces is growing global LNG supplies. As the Energy Security Initiative at the Brookings Institution noted in its May 2012 assessment: “A well-supplied global gas market will give U.S. exporters fewer opportunities for exports.” [Red & bold emphasis added.]

Japan

Japan eyes huge loan to secure cheaper natural gas — DW Akademie, Germany

The Japanese government has announced that it's considering a multibillion-dollar loan for projects to secure cheaper natural gas. The country has struggled with mounting energy costs after the Fukushima disaster. [Red & bold emphasis added.]

¥1 trillion loan guarantee set for LNG quest (Feb 16) — The Japan Times, Japan

“We think there is room to lower import prices of natural gas,” Motegi said, referring to a program that helps companies participating in projects involved in the U.S. production of shale gas, which is cheaper than conventional natural gas. [Red & bold emphasis added.]

Russia

US LNG supplies won't affect Gazprom - deputy chairman — The Voice of Russia, Moscow, Russia

A significant increase in the volume of US Liquefied Natural Gas exports to global markets will have no impact on Gazprom’s positions in the gas sector, the company’s deputy chairman said.

Such gas export volumes, he said, will never affect the balance of power in the gas sector.

Webmaster's comment: One must take into account that Russia also previously claimed that it would export LNG to the US, and that US shale gas development would have no impact on Russia's natural gas business. Russia was wrong on both counts.

Top

2013 February 14

New Brunswick

Repsol LNG sale seen delayed as shale goring Canaport — Bloomberg Businessweek

Repsol SA’s effort to sell a liquefied natural gas business for about $2.7 billion has bogged down over its unsuccessful 25-year commitments to ship gas into Canada, two people familiar with the matter said.

Spain’s biggest oil explorer has found that Canaport, its underutilized LNG import hub, was a hurdle to closing a deal, the people said, asking not to be identified because the sale talks are private. Royal Dutch Shell Plc has negotiated for the assets, which are mostly in southeastern Canada, Trinidad and Tobago, Peru and Spain, one of the people said.

Canaport “has become a big white elephant for Repsol due to the North American gas-supply demand fundamentals,” said Cameron Gingrich, senior manager of gas services at Calgary- based consultancy Ziff Energy Group.

Finding buyers for the other LNG businesses, in the Caribbean, Peru and in Spain, will be easier, Gingrich said. Canaport could be turned into an export terminal or a storage site. [Red, yellow & bold emphasis added.]

Webmaster's comment: This is whopping confirmation that Downeast LNG is chasing its tail.

Alaska

Rosneft expands cooperation with Exxon in Alaska, Arctic, LNG (Feb 13) — Bloomberg Businessweek

Rosneft now has an option to take a 25 percent share in the Point Thomson project, a gas condensate deposit, on Alaska’s North Slope. That’s part of the deal signed today by Igor Sechin, Rosneft’s Chief Executive Officer, and Stephen Greenlee, Exxon’s exploration head, at Russian President Vladimir Putin’s residence outside Moscow.

Rosneft has formed partnerships with Exxon, Statoil SA and Eni SpA as it looks to explore Russia’s offshore areas and tight oil fields, while also gaining opportunities abroad. Rosneft and Exxon are exploring the Kara Sea and drilling pilot wells on tight oil deposits in Siberia. Rosneft has entered into Exxon projects in Texas and Canada as Rosneft’s board approved expanding a cooperation agreement today.

Compass: Apply three tests to gasline progress reports [Lobbying column] — Anchorage Daily News

After a decade of chasing an ill-fated gasline route into Canada, key decision makers now agree that a line from Prudhoe Bay to Alaskan tidewater is the proper route. This route provides access to the Asian liquefied natural gas (LNG) markets, a factor that is necessary for shipment of volumes sufficient to provide cheap in-state energy and a market able to fully consume our resource potential. However, there is still a lot of noise and political posturing about which project the state should pursue. [Red & bold emphasis added.]

Webmaster's comment: Mr. Walker, the general legal counsel for Alaska Gasline Port Authority, has a vested interest in exporting as much Alaskan natural gas as possible. Hence, he wants to "fully consume" Alaska's natural gas resource.

Walker apparently has not noticed that the natural gas resource around the Kenai LNG export terminal in the Anchorage area will soon be fully exhausted due to exporting LNG to Japan since 1969. By 2015, the community is planning to import LNG in order to heat their homes — because they've "fully consumed" the resource.

British Columbia

Kitimat LNG gets a boost as Chevron joins the fold (Feb 13) — Alberta Oil, AB

[T]he Kitimat LNG partners must now deal with the desire of customers in Japan and South Korea to change the oil-indexed pricing structure. LNG exporters have traditionally enjoyed in the Pacific Rim. And proponents of a handful of LNG export projects slated to be built in B.C. are depending on that structure – where gas can fetch prices three to four times as high as what it can be sold for in North America – to justify spending billions on these projects.

Webmaster's comment: LNG prices for LNG to Japan from the US are already deteriorating away from the price of oil, and toward US Henry Hub-linked prices — around 1/5 the price Japan is currently paying.

Expansion of B.C. natural gas industry raises concerns (Feb 13) — CBC News

"We have to pollute, permanently, trillions of litres of fresh water every year to achieve that; fragment the land base the likes of which we've never seen; put people's health and safety at risk. None of the environmental implications of this economic strategy were addressed in the throne speech." [Red & bold emphasis added.]

Oil and gas producers balk at LNG tax — Calgary Herald, Calgary, AB

OTTAWA — Canada’s oil and gas industry disagrees with B.C. Premier Christy Clark’s plan to rake in extra revenues from future liquefied natural gas plants.

A spokesman for the Canadian Association of Petroleum Producers said Wednesday the industry doesn’t share the Clark government’s view that B.C.’s LNG sector, once it’s up and running, will have a significant competitive advantage compared to its assumed top competitor, Australia.

Clark would not say how much B.C. plans to tax producers, but said the province can introduce a new tax and still remain more competitive than other major LNG producers such as Australia.

Morrison wouldn’t comment directly on whether Clark’s position could cause problems for the association, which is pushing the federal government to extend tax breaks to the LNG sector. [Red & bold emphasis added.]

Clark government’s prosperity fund raises questions (Feb 13) — The Vancouver Sun, Vancouver, BC

It's not clear how the government intends to raise all the revenues it is forecasting, said Geoff Morrison, a spokesman for the Canadian Association of Petroleum Producers.

And that causes uncertainty, the one thing business doesn't like.

"Of course, you can forecast resource rents to your heart's content. But these tend to be ephemeral because markets correct," said Mark Jaccard, a professor of resource management at Simon Fraser University. "The price differential between natural gas in North America and Asia will definitely not hold."

Natural gas firms fume as B.C. proposes LNG tax (Feb 13) — The Globe and Mail, Toronto, ON

The energy sector is lashing out at a British Columbia proposal to impose a major new tax on the impending export of natural gas, saying the province risks serious damage to a fledgling industry before it has a chance to take wing.

Some 10 proposals are now being considered for the shipment of liquefied natural gas from B.C., a province that has eagerly promoted the vast new revenues the coming development stands to produce. The province has said it now believes five export terminals could be built in coming years; the first could be complete by 2015. [Red & bold emphasis added.]

Province standing by greenhouse gas reductions by 2020 — CKNW, Vancouver, BC

Environment Minister Terry Lake is downplaying environmental concerns over the [liquefied] natural gas industry.

Lake says the government is still committed to a 33 percent cut in greenhouse gas emissions by 2020, the same year it hopes to see five L-N-G plants in operation.

Webmaster's comment: British Columbia is re-defining natural gas as "clean" when it is used to power LNG export terminals. The emporer has no clothes!

Clark was all LNG, all the time on Hong Kong, China mission — Times Colonist, Victoria, BC

Premier Christy Clark's September 10, 2012, meeting in Hong Kong with tycoon Li Ka-shing was all about liquefied natural gas – despite the visit being pitched as an exploration of general trade opportunities.

Briefing documents obtained by Business in Vancouver, via Freedom of Information, reveal that Clark planned with jobs, tourism and skills deputy minister Dave Byng and then chief of staff Ken Boessenkool to discuss nothing but LNG opportunities over tea with Li.

Yesterday's throne speech to open the last legislature session before May's election was centred on Clark's dream to open three LNG plants by 2020 and make B.C. a major exporter.

British Columbia introduces tax on LNG projects to pay down debt (Feb 12) — Bloomberg

Canada’s westernmost province forecast it will raise as much as C$260 billion ($259 billion) over the next three decades to cut debt and funnel revenues into a so-called Prosperity Fund, according to statements from the government after Premier Christy Clark outlined her LNG plan in a speech.

Additional LNG tax could mean up to $260 million in revenue over 30 years (Feb 12) — EnergyCity.ca

That includes direct taxes paid by the LNG facilities as well as royalties from natural gas extraction needed to support those facilities. Those numbers also include revenues from personal income taxes from new jobs the industry creates. They do not include other potential revenues from economic activity resulting from the LNG industry. [Red & bold emphasis added.]

Clark projects LNG windfall in throne speech (Feb 13) — The Vancouver Sun, Vancouver, BC

Critics skeptical of funds based on plants not yet built, sales contracts not yet signed

[Canadian Association of Petroleum Producers spokesman Geoff Morrison] said the LNG industry is competitive, capital is fluid and despite price differences of $3.50 a unit in North America and $15 a unit in Asia, the margins, once all the costs of development are considered, are quickly whittled down to just a few dollars per unit.

"I think it will cause industry to reflect on their business assumptions. I don't think it will send anyone running for the hills but they are going to take a long look at this and decide what it might mean to them in the future and likely have a discussion with the government about that," Morrison said of Clark's plan.

B.C. Liberal throne speech: something of a gasbag [Opinion column] (Feb 13) — The Vancouver Sun, Vancouver, BC

Do the Liberals seriously expect Ottawa to reduce its tax room on natural gas while Victoria is publicly scheming to increase its levies on the same product?

By this point in the day's overheated narrative, one needed reminding that to date the province has precisely zero LNG plants, nor have any of the major global players with an interest in B.C. (Shell, Chevron, etc.) green-lighted the construction of one.

Webmaster's comment: The Government of Canada is being asked to provide a $2 billion tax subsidy to British Columbia LNG export projects, while British Columbia Premier Christie wants to add a tax on those same industries. Robbing Peter to pay Paul?

In Throne Speech, Clark expects at least $130-billion in LNG riches (Feb 12) — The Globe and Mail, Toronto, ON

[T]he government proposes a new LNG tax designed to be competitive with the province’s chief rival in the market, Australia, which has an LNG tax and a more costly royalty regime.

B.C.'s liquefied natural gas boom to fuel $100 billion Prosperity Fund (Feb 12) — Global Television, Toronto, ON

Clark would not elaborate on her government's plans to build the Prosperity Fund through a new LNG tax to generate revenues. She said sensitive negotiations are underway with the LNG companies and the timing isn't right to discuss the tax issue.

The Liberal government promised in its September 2011 jobs plan the development of three LNG plants in northwest B.C. by 2020. That figure has since been upgraded to five plants, but the completion dates are not as firm, and the companies have yet to make their final investment decisions. [Red & bold emphasis added.]

Christy’s miracle Prosperity Fund should wipe out deficit as quickly as it ushers in world peace [Opinion column] (Feb 13) — The Province, Vancouver, BC

...Tuesday’s throne speech left me looking for an ice-scream scoop to go along with all the pie-in-the-sky being served up.

It was all very reminiscent of an earlier premier with the same last name, who once promised voters the streets would be paved with gold on the strength of B.C.’s natural resources.

“Three — count ’em — three aluminum smelters!” Glen Clark promised back in 1996.

But exactly zero — count ’em — zero aluminum smelters eventually materialized.

LNG plant construction to create 39,000 new BC jobs – study — Beacon News, Calgary, AB

Up to 75,000 new jobs after LNG plant construction completed

A government study predicts 39,000 new annual BC jobs during the nine-year construction of three small and two large LNG plant in the province.

Webmaster's comment: Really? 75,000 (or even 39,000) new permanent jobs after five new LNG export terminals are in operation?

Consider this: The ConocoPhillips Kenai LNG export terminal in Alaska had 55 full-time employees in 2005, when they still had plenty of gas to export. Those 55 employees were at three locations — the LNG terminal, an offshore gas platform, and across the inlet from the terminal, at Beluga, Alaska. (Admittedly, the Kenai LNG terminal is very small, and would also have spinoff jobs in addition to the 55 employees.) British Columbia is projecting 15,000 new jobs, on average, for each new terminal — that's around 14,495 more jobs than at the Kenai LNG terminal. All spinoff jobs?.

Realistic, or fantasy? You be the judge.

LNG looks years ahead, as B.C. Liberals hope to ride gas boom to election — The Province, Vancouver, BC

Whistler-based LNG expert Zoher Meratla says companies like Chevron, Shell and Mitsubishi, who are making plans to develop LNG export terminals in northwest B.C., think ahead in time horizons that extend beyond 20 years. [Red & bold emphasis added.]

Webmaster's comment: LNG developers may be thinking over 20 years ahead, but that doesn't make their projections correct. Consider the planning disaster with the over 40 US and Canadian plans to construct LNG import terminals that failed to take place.

Premier launches ‘Prosperity Fund’ (Feb 13) — Merritt Herald, Merritt, BC

NDP leader Adrian Dix said the government’s focus on LNG development is at odds with its heavily advertised jobs plan, with little mention of forestry, mining, tourism, film and TV production or high technology. The government missed its natural gas revenue targets in a budget update six months ago, so projecting LNG revenues many years in the future is questionable at best, he said. [Red & bold emphasis added.]

Liberals high on natural gas futures (Feb 13) — North Shore News, North Vancouver, BC

[Political pundit and former North Vancouver NDP MLA David Schreck ] said even if the benefits of an LNG industry work out as expected, the province won't see major economic benefits from it for about a decade.

LNG development in BC to create more jobs, Canada (Feb 13) — LNG World News

The nine-year construction phase for LNG projects is the most labour intensive aspect of such projects with regard to generating direct jobs. As that phase winds down, those direct jobs are expected to be replaced with ongoing jobs needed to maintain the plants and supporting pipelines, as well as for supporting exploration and development of additional natural gas needed to supply the LNG plants.

LNG development expected to bring billions for new BC Prosperity Fund, Canada (Feb 13) — LNG World News

Premier Christy Clark announced the establishment of a new British Columbia Prosperity Fund to ensure communities, First Nations and all British Columbians benefit from the development of a new liquefied natural gas (LNG) industry.

United States

EDF, Exmar propose floating LNG plants in US — Hydrocarbon Processing

Floating plants could give companies a large head start over many other gas-export projects, which must wait for government approval before building their land-based liquefaction facilities. Even Cheniere Energy won't be done building its export terminal in Sabine Pass, Louisiana, until 2016.

EDF Trading and Exmar plan to export US natural gas using offshore liquefaction equipment parked next to existing LNG import terminals, the companies said late Wednesday.

"This is a quick solution," Mr. Lavent said. "Lots of import terminals already have jetties and storage -- we would park (the barge) alongside, produce LNG on the barge, and export it from the jetty." [Red & bold emphasis added.]

EDF, Exmar to explore LNG export opportunity in North America — LNG World News

EDF Trading and EXMAR announced their intention to jointly look for small-scale LNG export opportunities in North America using barge-mounted natural gas liquefaction developed by EXMAR, Wison and Black&Veatch.

The aim would be to bring mobile, self-contained liquefaction units to LNG import terminals in the US using existing pipeline, tank and jetty infrastructure to enable LNG export. [Red & bold emphasis added.]

Wison selected for ambitious North American LNG project — SinoShip News, Dalian, China

Shanghai: In a huge coup for Chinese LNG construction ambitions, Shanghai’s Wison Group has been selected for an ambitious new North American gas venture.

EDF Trading and Exmar have joined forces to look for small-scale LNG export opportunities in North America using barge-mounted natural gas liquefaction developed by Exmar, Wison and Black&Veatch.

The Wison Group is the largest private EPC contractor in China specialising in the design and construction of petrochemical and coal gasification facilities. Wison Offshore & Marine is a leading contractor to the international offshore oil and gas industry.

Proposed US LNG export projects key to commoditization: panelists (Feb 13) — Platts

Speaking at Platts' 12th Annual Liquefied Natural Gas conference, Richard Pratt, vice president at consultant and brokerage group Fearnley, rattled off a list of ingredients required for the US to succeed in exporting LNG, including the availability of cheap gas, having a good geographical location, the availability of cheap labor and a having a supportive environment.

"This doesn't stack up well for US projects," he said, noting the US gas market's history of volatility and the country's locational disadvantage to demand markets. "These projects have absolutely none of the success factors." [Red & bold emphasis added.]

LNG exports are swirling through Capitol Hill and White House (Feb 13) — EnergyBiz

A lot of issues are play, namely whether any exports would lead to higher energy prices at home at a time when the chemical sector here is making key investments. Also, there’s the environmental questions surrounding the development of that natural gas, which would use hydraulic fracturing to capture the shale gas embedded in rocks a mile beneath the earth’s surface.

Altogether, 11 LNG receiving facilities exist here and 9 of those are asking U.S. regulators if they can be converted to export terminals. [Red & bold emphasis added.]

Top

2013 February 12

Gulf of Mexico

LNG exports set for BP from Texas — UPI

The company said it would take about four years to complete construction once it receives regulatory approval. A final investment decision is expected later this year.

BP signs deal to export US gas from Texas terminal — Energy Tribune

BP is the third company to sign an agreement to buy LNG from the facility, following two Japanese companies Osaka Gas and Chubu Electric Power, which contract another 4.4 million tons of LNG per year from the facility, said the report.

The booming natural gas production in the U.S. sent natural gas prices last year to their lowest level in a decade, prompting companies to seek permission to ship U.S. fuel overseas. [Red & bold emphasis added.]

Freeport LNG signs 20-year liquefaction tolling agreement with BP Energy Company (Feb 11) — Rock Hill Herald, Rock Hill, SC

Freeport LNG is next in line to receive DOE approval, which would cover the entire production volume of the initial two liquefaction trains and would allow for Freeport LNG to begin exporting to non-FTA countries immediately upon completion of construction. The DOE is expected to commence review of Freeport LNG's pending non-FTA export application immediately after the period for response to the initial comments raised in respect of DOE's 2012 LNG Export Study ends on February 25, 2013. Freeport LNG's second DOE application covering up to two additional trains of production volume is fourth in line in the order established by DOE for review and processing of pending non-FTA export applications.

Editorial: Natural gas production, exportation of LNG good for East Texas — The Lufkin News, Lufkin, TX

The recent boom in natural gas production — some analysts estimate there is enough recoverable gas in the United States to meet current and future needs for the next century — has led to lower prices and producers looking for new markets. It has also led to resistance from several environmental groups. The Senate hearings are important because of the large natural gas reserves on public lands and federal approval from the Department of Energy is required to export liquefied natural gas (LNG). [Red & bold emphasis added.]

British Columbia

Canadian LNG plants seek $2B in tax breaks — Ship & Bunker

David Collyer, president of the Canadian Association of Petroleum Producers (CAPP), said the industry wants LNG plants to be reclassified as manufacturing plants rather than part of the gas transmission process, which would allow them to write off 90 percent of their capital investments over seven years, rather than over 27 years. [Red & bold emphasis added.]

Webmaster's comment: Apparently, Big Gas just doesn't make enough money. So, the public should subsidize LNG export projects — projects that deplete the Canadian public's natural gas energy-security resource.

City of Terrace writes LNG impact shopping list — Terrace Standard, Terrace, BC

“There will be a period of time, and we’re at the front end of it now, prior to when those LNG terminals are up and running where there will be pressure on community infrastructure and community services, and no royalties to share,” said Bennett. “Clearly we’re going to have to have a plan to deal with the interim. Fort Nelson is faced with exactly the same thing and we have some experience with developing an agreement with them that we’ll probably utilize in working with Terrace, Kitimat, and Prince Rupert.” [Red & bold emphasis added.]

More Canadian LNG bound for Asian markets — UPI

Apache's Canadian subsidiary said it completed a deal with Chevron Canada Ltd. to build and operate a liquefied natural gas project in Kitimat, British Columbia. Both companies serve as equity partners in the plant, affiliated pipelines and an estimated 644,000 acres of undeveloped land in the provincial Horn River and Liard basins.

Apache, Chevron Kitimat LNG joint venture is under way — The Motley Fool

On Monday, Apache Corp. and Chevron announced that their joint venture to develop the Kitimat liquefied natural gas (LNG) project is up and running. This means, among other things, that former stakeholders Encana and EOG Resources, which previously owned 30% stakes in the LNG plant and Pacific Trail Pipelines, have now officially sold their stakes and exited the JV.

Kitimat LNG on the northern British Columbia coast in Canada, is completing front-end engineering and design, and early site work is under way. Current plans call for two liquefaction trains, each with expected capacity of 5 million tons of LNG per annum (about 750 million cubic feet of gas per day). According to the companies, Kitimat LNG has received all significant environmental approvals and a 20-year export license from the Canadian federal government.

Chevron begins Canadian partnership with Apache on Kitimat LNG exports (Feb 11) — Hydrocarbon Processing

After a brief transition period, Chevron will assume operatorship of the LNG plant and the pipeline. Apache Canada increased its ownership in the LNG plant and pipeline from 40% and will operate the upstream assets.

Big opportunity for U.S. in nat gas exports — MarketWatch

Less than half a decade ago, observers were predicting imminent and substantial shortfalls of natural gas for domestic consumption. But U.S. supplies didn't diminish or stagnate. Quite the contrary: Energy producers combined horizontal drilling and hydraulic fracturing to exploit reserves of gas trapped in layers of shale rock in Pennsylvania, Texas and Louisiana

And now it seems that on a near-weekly basis, an energy producer or combinations thereof announce plans to convert terminals originally built — some decades ago — for regasification liquefaction facilities. [Red & bold emphasis added.]

United States

"Time out" on LNG exports is sought from Obama administration — (PR Newswire) The Sacramento Bee, Sacramento, CA

WASHINGTON, Feb. 12, 2013 /PRNewswire-USNewswire/ -- In a major issue advertisement appearing in today's New York Times, more than 40 groups and high-profile individuals are calling on President Obama to take a "time out" in the headlong run to export more than 40 percent of America's natural gas for use by other nations.

The ad – signed by the Civil Society Institute, Sierra Club, Physicians Scientists Engineers for Healthy Energy, "Gasland" director Josh Fox, actor Mark Ruffalo and many others – urges Americans to go to http://www.TimeOutLNGexports.org to tell President Obama to take a closer look at liquefied natural gas (LNG) exports.

The full text of the ad reads as follows:

...Exporting Liquefied Natural Gas (LNG) to overseas markets will mean more drilling and fracking on US land, which ar e dirty and dangerous practices. Exports will allow the gas industry to make billions of dollars at the expense of our communities and public health....

Update 1-U.S. senate panel mulls future of natural gas policy — Reuters UK

Booming shale gas production is reshaping the energy outlook in the United States and Washington must re-examine how it regulates natural gas development and exports, lawmakers said on Tuesday.

In his first hearing as chairman of the Senate energy committee, Democratic Senator Ron Wyden of Oregon lauded the growth in natural gas production, but stressed the need for adequate regulation and called for a thorough review of gas export guidelines.

"Why take the risk and let speculators set gas prices like they did 10 years ago?" Andrew Liveris, chief executive of Dow Chemical Co, told lawmakers, referring to price spikes a decade ago that pummeled manufacturers and consumers. "We all remember the Enrons and what the efficient market did for us."

"Now shale gas production is expanding with supersonic speed without having in place even the basic environmental and public health requirements that apply to other industries," [head of the Natural Resources Defense Council Frances Beinecke] said in prepared testimony. [Red & bold emphasis added.]

Senate Energy Committee lawmakers search for 'sweet spot' on natural-gas exports — The Hill, Washington, DC

"Let's look before we leap," Wyden told reporters after the hearing. He was noncommittal on whether hitting that "sweet spot" would require legislation.

“Instead of a manufacturing renaissance, major gas consumers could find themselves hit hard with energy price hikes and forced to sideline job-creating efforts,” Wyden said in his opening remarks.

The natural-gas price gap between the U.S. and Asia also is likely to close in the long term, which should temper some of the export frenzy, Kenneth Medlock, a professor at the Baker Institute for Public Policy at Rice University, said in testimony.

Dow Chemical CEO warns Congress about exporting too much liquefied natural gas — Detroit Free Press, Detroit, MI

WASHINGTON — The head of Midland-based Dow Chemical went to Capitol Hill this morning to warn against policies that would lead to exporting too much of America’s liquefied natural gas resources.

“America would sacrifice this once-in-a-generation opportunity,” said Liveris. “It’s very easy to see why other nations want our gas. … What’s harder to see is why we’d be willing to (export most of it).”

Senate hearing on natural gas reveals divisions in the manufacturing sector — Houston Business Journal, Houston, TX

At a U.S. Senate Committee on Energy & Natural Resources hearing Tuesday, manufacturers opened up about their severe differences on natural gas policy.

During a witness panel at the hearing, The Dow Chemical Co. (NYSE: DOW) and the National Association of Manufacturers butted heads over the topic of exporting liquefied natural gas.

Natural gas exports: A boost the U.S. economy needs (Feb 11) — Investors.com

Production of natural gas in this country has swelled from 18.9 million cubic feet in 2005 to more than 24 million cubic feet in 2011. It's a sharp jump, reminiscent of big gains made from 1950 to 1971.

This nation has a growing glut of natural gas. So why not sell the surplus abroad? [Red & bold emphasis added.]

Webmaster's comment:Downeast LNG is in an ever-increasing nose-dive to business oblivion.

World

Japan to ask Qatar for stable supply of LNG but at lower prices — Platts

Japan's Minister of Economy, Trade and Industry Toshimitsu Motegi will ask Qatar Tuesday to remain a reliable LNG supplier and supply the gas at lower prices as part of ongoing efforts to lower Japan's increased import costs, ministry officials said.

Japan ... has been stepping up efforts to lower the cost of LNG imports after reporting its second consecutive annual trade deficit in 2012.

LNG imports from the Middle East, which are linked to crude oil prices, are far more expensive than natural gas prices in the US, where Henry Hub prices last year fell to 10-year lows and are currently well below LNG prices. [Red & bold emphasis added.]

Webmaster's comment: US exporters have put in motion killing of the golden goose; Cheniere Energy has made a deal to sell LNG at Henry Hub-linked prices. Thus, LNG sales to Japan are likely to return far less profit than is being projected by the mad LNG-export goldrush participants.

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2013 February 11

New Brunswick

McKenna says shale gas could mean $7B in royalties, taxes — CBC News

Last year, access to low-cost shale gas in the United States saved $107 billion and the industry boom has already created more than 1.7 million jobs, said McKenna.

"A confluence of conditions put Saint John, New Brunswick in an extraordinarily advantaged position to take advantage of this unprecedented energy revolution that is sweeping the world," he said.

Among them, the Canaport liquefied natural gas (LNG) terminal, which could be converted into an export facility that could tap into lucrative foreign markets.

Webmaster's comment: This is the third public suggestion to export LNG from the Maritimes. The previous two making the suggestion were Pieridae Energy's Goldboro LNG (Goldboro, NS), and Corridor Resources (NS, and NB).

Gulf of Mexico

Freeport LNG signs 20-year liquefaction tolling agreement with BP Energy Company [Press release] — PR Newswire

HOUSTON, Feb. 11, 2013 /PRNewswire/ -- Freeport LNG Expansion, L.P. (Freeport LNG) today announced that it had entered into a binding 20-year Liquefaction Tolling Agreement (LTA) with BP for 4.4 million tons per annum (mtpa), equivalent to the production capacity of the second train of Freeport LNG's proposed natural gas liquefaction and LNG loading facility on Quintana Island near Freeport, Texas. The LTA with BP will commence upon completion of construction of the second liquefaction train.

BP takes U.S. LNG export capacity at Freeport terminal in Texas — Bloomberg

The glut of natural gas that has caused the lowest U.S. prices in a decade is prompting companies to seek permission to ship fuel overseas. Freeport, Texas is one of more than 20 proposed LNG export terminals in the U.S. seeking permits allowing processing of about 31 billion cubic feet a day, according to the U.S. Department of Energy. [Red & bold emphasis added.]

British Columbia

LNG boom may mean emissions rethink (Feb 10) — The Globe and Mail, Toronto, ON

The B.C. government says it will surpass its initial targets for building a liquefied natural-gas industry on the West Coast, predicting that five new processing plants will be in production by 2020. But officials are refusing to divulge what all that energy-intensive processing might do to the province’s climate-change law.

In the same year that all those new facilities are supposed to be coming online, the province’s greenhouse-gas emissions must be reduced by roughly 36 million tons compared to 2007 levels. B.C. adopted legislation more than five years ago compelling a reduction of GHG emissions by at least 33 per cent from those levels by 2020.

“Five LNG facilities would obliterate any hope of meeting those targets,” said New Democratic Party energy critic John Horgan.

According to modelling by the Pembina Institute, those five LNG plants would generate more than 43 million tons of greenhouse-gas emissions, assuming they are generating their own energy.

Apache, Chevron complete Chevron Canada's entry into Kitimat LNG [Press release] — Yahoo Finance

HOUSTON, Feb. 11, 2013 /PRNewswire/ -- Apache Corporation today announced that its subsidiary Apache Canada Ltd. has completed the previously disclosed transaction with Chevron Canada Limited to build and operate the Kitimat LNG project and develop world-class natural gas resources at the Liard and Horn River basins in British Columbia, Canada.

United States

Overnight Energy: ‘State’ secrets to be revealed — The Hill, Washington, DC

The Senate Energy and Natural Resources Committee will convene a long-awaited hearing Tuesday on whether the U.S. should expand exports of liquefied natural gas (LNG).

Witnesses for the 10 a.m. hearing, which will be webcast, include Dow Chemical CEO Andrew Liveris, Natural Resources Defense Council President Frances Beinecke and American Petroleum Institute CEO Jack Gerard.

Natural gas hearing to expose divisions — Fuel Fix

The newly refashioned Senate Energy and Natural Resources Committee is set to hold its inaugural hearing on the [LNG export] issue Tuesday.

Ahead of Senate energy hearing, CLNG’s Cooper provides testimony on LNG exports — Center for Liquefied Natural Gas (CLNG)

...Cooper notes that the United States has abundant supplies of natural gas, more than enough to allow for exports while also meeting growing domestic demand. [Red & bold emphasis added.]

Webmaster's comment: Even the Center for LNG is advocating for exporting. Downeast LNG's investors keep kissing more and more money goodbye on a white elephant import proposal.

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2013 February 8

Gulf of Mexico

Senator Landrieu supports Golden Pass LNG export application — LNG Law Blog

U.S. Senator Mary Landrieu (D-La.) filed a letter with the U.S. Department of Energy (DOE) this week in support of Golden Pass Products LLC's application to export LNG to nations without a Free Trade Agreement with the United States, citing the project's potential to create thousands of jobs, increased tax revenues, and lasting economic benefits for the nation.

Indian state company to purchase U.S. shale assets — Energy & Capital

GAIL looking to secure LNG

GAIL presently has a 20 percent stake in Carrizo Oil’s Eagle Ford shale assets, Business Standard reports, and the company has signed up with Cheniere Energy’s Sabine Pass project to import 3.5 million tons of liquefied natural gas per year. It is currently looking for more LNG import opportunities.

British Columbia

Oil and gas industry seeks billion-dollar tax break to lure LNG plants — The Vancouver Sun, Vancouver, BC

The Canadian oil and gas industry is asking Ottawa for subsidies that could be worth $2 billion in tax savings to encourage the development of liquefied natural gas plants in British Columbia.

The change would mean they could write off 90 per cent of their investments in seven years, rather than the 27 years it takes under current tax regulations, Collyer said.

Using Lo’s numbers, that would mean a tax break of between $1.5 billion and $2 billion over seven years for 800 permanent jobs.

“It’s fair to say we shouldn’t be extending the same kind of tax breaks that manufacturers get to LNG,” said Canadian Taxpayers Federation director Jordan Bateman. “Manufacturing and what an LNG plant does are completely different. This isn’t free money. This is money that will come out of British Columbians’ pockets.” [Red & bold emphasis added.]

Government updates L-N-G strategy — CKNW, Vancouver, BC

In a one year update on the plan, the government says there are five solid proposals to build L-N-G plants on the north coast by 2020, generating up to 75-thousand full time jobs.

One big outstanding question is how many of those plants will burn natural gas for power, and what impact that will have on BC's greenhouse gas emissions. [Red & bold emphasis added.]

Webmaster's comment: 75,000 full-time jobs from five LNG terminals (15,000 jobs per terminal)? Hardly! Several thousand temporary full-time jobs (and spin-off jobs) would be created during construction, but most would vanish once construction were completed.

Emerging LNG export industry leads to British Columbia job creation — PennEnergy, Houston, TX

With timely, concentrated actions, the government of B.C. has built the foundation necessary to reach, and perhaps surpass, the BC Jobs Plans goal of having three LNG facilities in operation by 2020.

Energy bar — Regina Leader-Post, Regina, SK

Stark warning for LNG
North American liquefied natural gas energy producers may not feel very optimistic after reading Canadian Energy Research Institute's latest report on the chilled gas' export potential. For Canadian exporters, CERI has a stark warning: "There is room for North American suppliers in an Asian market if the U.S. does not proceed with all planned projects."

[L]ike most things in the North American energy sector these days, the LNG industry could be a victim of its own success: "It is entirely possible that if all Canadian projects go as planned, there may be delays or significant cost overruns similar to the cost overruns that have plagued the Australians." [Red & bold emphasis added.]

Chevron sets LNG terms (Week of Feb 10) — Petroleum News, Anchorage, AK

Company’s chairman says prices need to be ‘close to oil parity’ to support cost

Chevron has wasted no time sending a clear-cut message to potential Asian buyers of Canadian LNG: Unless sales are closely tied to, or on par with oil prices they can forget any contract deals.

Just over a month after striking a deal to become operator of Kitimat LNG, with Apache holding the remaining 50 percent, Chevron Chairman and Chief Executive Officer John Watson took a hard line, unwilling to continue the struggle Kitimat’s former ownership group (Apache, Encana and EOG Resources) experienced in trying to arrange offtake orders.

“You’ve got this trend of Henry Hub indexation, which is perceived to be a lower level of pricing, creeping into the expectations of Asian buyers nowadays in an attempt to squeeze seller margins,” said Asish Mohanty, an LNG analyst with energy consultant Wood Mackenzie.

United States

APGA and Sierra Club continue opposition to DOE LNG export applications — LNG Law Blog

Earlier this week the American Public Gas Association (APGA), a non-profit association of publicly-owned U.S. natural gas distribution companies, and Sierra Club filed protests at the U.S. Department of Energy (DOE) in opposition to applications filed by CE FLNG, LLC, Excelerate Liquefaction Solutions, LLC, and Golden Pass Products LLC to export LNG to nations without a Free Trade Agreement with the United States. The protestors cite the potential for higher domestic natural gas prices as well as insufficient environmental and economic support for LNG exports. [Red & bold emphasis added.]

Critics of LNG exports: Undermine its strategic benefits — The Maritime Executive, Fort Lauderdale, FL

The ongoing shale gas boom here in the U.S. has proven itself to be no flash in the pan. Estimates of domestic shale reserves range from 300 Tcf to as much as 900 Tcf. Investment in natural gas extraction projects has poured into regions across the country, from North Dakota to Pennsylvania. However, the domestic market for natural gas will soon be saturated with such high levels of production – and perhaps already is – resulting in lower domestic prices. That, in turn, could lead to a decline in the investment in manufacturing and equipment that has come with the shale gas boom. [Red & bold emphasis added.]

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2013 February 7

Gulf of Mexico

Japan’s Tepco signs gas deal with US — Financial Times, UK

In a shift in pricing strategy, Tepco said it would for the first time link the price of gas in its contract to the US Henry Hub benchmark, rather than a formula linked to the price of oil.

It joins other Japanese gas importers including Kansai Electric Power, Tokyo Gas and Osaka Gas that are also trying to move away from oil-linked prices in a bid to reduce their costs.

Over the past 10 years, the price of internationally-traded Brent crude has roughly quadrupled, while Henry Hub gas has fallen by about a third. [Red & bold emphasis added.]

Japan's Tepco seeks to import gas from Cameron LNG project in Louisiana — Hydrocarbon Processing

The proposed 20-year deal between Tokyo Electric, also known as Tepco, and potential LNG supplier Cameron LNG, follows contracts Cheniere Energy has inked with Korea Gas Corp. and others.

Tepco said in a press release the natural gas it buys from Cameron would be linked to US natural gas price benchmark Henry Hub, which closed Wednesday at $3.42/MMBtu.

The deal could have wider repercussions in the global LNG market by helping break the link between oil and LNG and eventually helping to bring world LNG prices down, said Macquarie Research energy analyst Vikas Dwivedi. [Red & bold emphasis added.]

Japanese utility to import LNG from Louisiana — The Advocate, Baton Rouge, LA

[I]ncreased domestic supply has reduced U.S. demand for LNG from the Middle East. That is freeing up more LNG for Asia, which accounts for 30 percent of global consumption.

...Japanese trading houses and energy companies are [also] seeking access to LNG from Canada and elsewhere. [Red & bold emphasis added.]

Caribbean

Jamaica private sector groups press for plan to cut electricity rates — Stabroek News, Georgetown, Guyana

(Jamaica Gleaner) Three of the country’s leading private-sector groups have given Energy Minister Phillip Paulwell and the Office of Utilities Regulation (OUR) 30 days to lay out a clear road map to secure massive reductions in electricity rates.

“I don’t think that LNG project is alive without that plant happening, and my take on it is that we are basically back at square one,” [Jamaica Manufacturers’ Association president Brian Pengelle] said.

It's costing us! [Op-ed] — Jamaica Observer, Kingston, Jamaica, West Indies

[Opposition Leader Andrew Holness'] comment comes in response to indications that the much-touted project is in limbo due to the reported inability of the JPS to source Liquefied Natural Gas (LNG) at a price that would allow the power company to operate without incurring losses.

[I]n an announcement late last year, Energy Minister Phillip Paulwell disclosed that the Government was no longer interested in being responsible for sourcing the LNG, and had instead decided to give JPS the go-ahead to source the fuel for the new generating plant.

United States

Getting natural gas right a priority [Op-ed] — The Hill, Washington, DC

First, it’s important that companies extract this resource safely. Common-sense rules can safeguard communities that could be affected by gas development, without harming natural-gas producers.

Next, decisions about exporting natural gas could have enormous consequences for how shale gas affects the economy. I want to ensure misguided government policy doesn’t shut down the manufacturing resurgence this country has seen as a result of reliable, low-cost natural-gas supplies. But I don’t oppose all exports. My aim is to find a sweet spot that allows some exports and keeps wells in production, while ensuring U.S. manufacturing and national security are not harmed by allowing unfettered liquefied natural-gas exports.

Getting natural gas right is the first step, but it’s not enough. The low-carbon economy also needs more renewable energy and more efficient use of the energy the U.S. already has.

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2013 February 6

New Brunswick

Canada: Canaport to get LNG cargo (Feb 4) — LNG World News

Repsol YPF SA’s Canaport terminal in Canada is expected to get one liquefied natural gas cargo onboard the 266,000 cbm Zarga from Qatar on February 14, according to port data.

Maine

As natural gas brings down electricity and heating costs, Maine can’t get enough (Feb 3) — Bangor Daily News, Bangor, ME

Maine is hungrily eyeing Pennsylvania.

That’s where the natural gas is.

The nonprofit that runs the New England power grid is exploring incentives to encourage gas-fired power plants to commit to long-term contracts, which could in turn finance more pipelines. The Governor’s Energy Office is looking at ways to facilitate capital investment. The Maine House minority leader has a “bold proposal” — but he’s not sharing it just yet. [Red, yellow & bold emphasis added.]

Webmaster's comment: Downeast LNG president Dean Girdis must be crying in his beer. Maine wants access to domestic natural gas, not LNG imports. And, pipeline infrastructure expansion is the most practical way to access the domestic sea of natural gas in Pennsylvania.

Southeast

Shell and Kinder Morgan to export LNG from USA — HazardEx

Shell US Gas & Power and Southern Liquefaction Company, an EPB Kinder Morgan subsidiary, have announced plans to develop a natural gas liquefaction plant in two phases at Southern LNG’s existing Elba Island LNG terminal, near Savannah, Georgia.

“This announcement underscores how the abundance of natural gas in the U.S. is changing the energy landscape,” said Marvin Odum, President of Shell Oil Company. “With a measured, phased approach, exports of cleaner-burning natural gas can help meet the world’s rising energy needs while also giving a boost to the US economy.” [Red & bold emphasis added.]

Gulf of Mexico

Seven LNG cargoes re-exported in 2012 (USA) (Feb 4) — LNG World News

[This article also appears under the United States heading, below.]

The LNG Capricorn departed from the Sabine Pass terminal on December 1, while the Excel LNG tanker left the Freeport terminal on December 18. Both of the cargoes were delivered to Brazil, DOE revealed in its monthly report for LNG imports.

Re-exportation of LNG lets marketers and suppliers store gas [at idle US import terminals], while waiting for price signals [price increases] before delivering their LNG to the higher-paying markets in Asia, Europe, and South America.

USA: Pangea receives permission to export LNG (Feb 5) — LNG World News

The U.S. Department of Energy has granted Pangea LNG Holdings, LLC, long-term, multi-contract authorization to export liquefied natural gas (LNG) to free trade agreement (FTA) nations from its South Texas LNG Project currently in development on Corpus Christi Bay.

The South Texas LNG Project is subject to federal, state and local regulatory approvals with the Federal Energy Regulatory Commission (FERC) acting as the lead federal agency. Pangea will begin the FERC pre-filing process by the second quarter of 2013 and expects the project to be in operation by at least 2018.

Caribbean

LNG mistake — Go-Jamaica, Kingston, Jamaica, West Indies

Energy Minister Phillip Paulwell believes a mistake was made when the Office of Utilities Regulation (OUR), requested submissions for only Liquefied Natural Gas (LNG), in the search for suppliers for the 360 mega watt power plant.

However, the energy minister also maintains that the government made the right decision when it mandated the JPS to identify a supplier and manage the process of procuring LNG.

OUR action disappoints JPS — Jamaica Observer, Kingston, Jamaice, West Indies

JAMAICA Public Service (JPS) last night expressed disappointment at the Office of Utilities Regulation (OUR) decision to cancel the 360 megawatt request for proposal (RFP) process, which would have facilitated the construction of a power plant to use liquefied natural gas (LNG) as its main fuel source.

Yesterday, the OUR said in a news release that the JPS was informed of the decision to terminate the process after it missed another deadline on Friday and had requested a 30-day extension.

Tomblin said that, despite her company's best efforts, the market is not supporting earlier estimates of LNG prices as low as $8.50 mmbtu. "We have received indicative prices of upwards of $12.50 mmbtu for LNG and the related infrastructure, which we estimate would result in a reduction of approximately 20 per cent in electricity costs," she explained.

OUR bows out, but JPS not giving up on new plant — The Gleaner, Kingston, Jamaica, West Indies

The Office of Utilities Regulation has formally cancelled its agreement with JPS for development the 360 MW liquid natural gas plant, but the power company said Tuesday that the decision does not mean an end to the energy project.

Jamaica finally gave up late last year on developing LNG, but JPS opted to press ahead on the plant project, saying it would explore the possibility of sourcing its own gas.

British Columbia

Showdown looms over B.C.’s gas exports — The Globe and Mail, Toronto, ON

Billions of litres of water a year. Thousands of expensive wells. New roads. Many hectares of trees felled and land cleared. Camps to house thousands of workers.

[T]he province has spent less time discussing the scale of industrialization that will be required, for many decades, to enable those exports of gas from B.C.’s northeast to ship to Asian customers. Natural gas is promoted as a clean-burning fuel – but getting it out of the ground remains a potentially messy process. The spectre of large tracts of boreal forest carved up by intensive gas drilling has already prompted one local first nation to prepare to do legal battle against new gas pipelines.

It’s an early warning that, like oil, natural gas exports stand to prompt a showdown over the environment.

Estimates vary, but hundreds – and perhaps more than a thousand – wells will need to be drilled each year to support three mid-sized liquefied natural gas terminals, a number that seems a reasonable possibility given current global corporate interest. Three terminals – Kitimat LNG, LNG Canada and one in Prince Rupert, where both BG Group PLC and Petronas have projects – could handle roughly 4.5 billion cubic feet a day in gas. [Red & bold emphasis added.]

Canadian Minister responds to latest LNG export licence — LNG World News

[This article also appears under the Canada heading, below.]

“British Columbia’s aspiration to build a liquefied natural gas (LNG) export industry took another step forward yesterday with the National Energy Board approving an export licence for LNG Canada.

NEB grants export licence to LNG Canada (Feb 5) — LNG World News

[This article also appears under the Canada heading, below.]

The export licence will authorize LNG Canada, a joint venture comprised of Shell Canada, Korea Gas Corporation (KOGAS), Mitsubishi Corporation and PetroChina, to export 670 million tonnes of LNG (approximately equivalent to 32.95 trillion cubic feet of natural gas) over a 25-year period. The maximum annual quantity allowed for export will be 24 million tonnes of LNG (approximately equivalent to 1.18 trillion cubic feet of natural gas). The daily equivalent of these exports is 3.23 billion cubic feet per day.

Shell gets go-ahead to export natural gas from B.C. coast (Feb 4) — The Globe and Mail, Toronto, ON

The NEB pointed out that its review of the Shell licence was constrained by new rules that came into effect last year. Under the federal Jobs, Growth and Long-term Prosperity Act, the NEB no longer has the latitude to take into account “all considerations that appear to it to be relevant” in examining a gas export licence request. [Red & bold emphasis added.]

Ewart: Oilsands situation a cautionary tale for LNG projects (Feb 5) — Calgary Herald, Calgary, AB

Accounts of billion-dollar cost overruns and logistical nightmares in the year-end financial and operating results of oilsands producers should give pause to companies lining up to be part of the looming LNG boom in northern B.C.

The bigger issue for Canadian LNG exports is an emerging price war and the transformation away from LNG pricing linked to oil. The gas price in Asia at the end of the decade could be much lower than when projects were announced. [Red & bold emphasis added.]

B.C. LNG – It’s a crowded coast (Feb 5) — The Globe and Mail, Toronto, ON

For sure, western Canada doesn’t need any more LNG project announcements. No one should go there any more, because it’s too crowded. [Red emphasis added.]

Government to offer LNG money to northwest — Terrace Standard, Terrace, BC

Community development minister Bill Bennett is wrapping up a two-day visit to Terrace and Kitimat today, speaking with officials about the impact of as many as five natural gas pipeline construction projects or pipeline expansion projects to feed accompanying LNG plants.

There’s an existing program in the northeast whereby municipalities and regional districts receive revenue from energy developments and equivalent revenue sharing agreements in the Kootenays, said Bennett.

Canada

Canadian Minister responds to latest LNG export licence — LNG World News

[This article also appears under the British Columbia heading, above.]

“British Columbia’s aspiration to build a liquefied natural gas (LNG) export industry took another step forward yesterday with the National Energy Board approving an export licence for LNG Canada.

NEB grants export licence to LNG Canada (Feb 5) — LNG World News

[This article also appears under the British Columbia heading, above.]

The export licence will authorize LNG Canada, a joint venture comprised of Shell Canada, Korea Gas Corporation (KOGAS), Mitsubishi Corporation and PetroChina, to export 670 million tonnes of LNG (approximately equivalent to 32.95 trillion cubic feet of natural gas) over a 25-year period. The maximum annual quantity allowed for export will be 24 million tonnes of LNG (approximately equivalent to 1.18 trillion cubic feet of natural gas). The daily equivalent of these exports is 3.23 billion cubic feet per day.

Canada continues its pivot toward Asia (Feb 5) — Investing Daily

In the case of natural gas, Canada’s exports via pipeline to the US have fallen nearly every year since 2007, and some industry veterans worry that it’s on an inexorable slide toward zero. That year, exports of natural gas peaked at 10.4 billion cubic feet per day (bcf/d) and have since dropped more than 22 percent to 8.1 bcf/d in 2012. [Red & bold emphasis added.]

United States

Researchers closer to identifying LNG hazards, NARUC panel told (Feb 4) — Oil & Gas Journal

States will need solid information because LNG is poised to play a bigger role in the US as a less-expensive alternative to diesel fuel in barges, ferries, and 18-wheeler, long-haul trucks, according to Michael Hightower, a senior technical specialist at Sandia National Laboratories.

NARUC and DOE formed the LNG research partnership soon after a tanker originally bound for Boston was rerouted to Elba Island, Ga., following the Sept. 11, 2001, terrorist attacks in New York and Washington.

In a May 2012 report to Congress, DOE said as much as 40% of the LNG spilled from a cargo tank would remain within the vessel, leading to extensive cryogenic fracturing and damage to its structural steel. “Basically, it turns to peanut butter,” Hightower said. Heat fluxes from an LNG pool fire would severely damage the vessel’s inner and outer hulls, making it sink, the report added. Other traffic in ports and inland waterways could be disrupted for some time, Hightower said.

Researchers also found from the study’s large-scale pool fire tests that the minimum safe public distance actually was 2-7% less than previous studies indicated. Hightower said this suggests the US Federal Energy Regulatory Commission’s requirement that an LNG terminal be at least a mile from any public place is sound.

Webmaster's comment: The above Mr. Hightower's statements are from the mouth of a US Federal employee who is engaged in researching LNG hazards. Ships delivering LNG to the proposed Downeast LNG terminal would place several US and Canadian communities within federally-defined Hazard Zones. If a catastrophic LNG release from a ship can cause the ship to be turned into "peanut butter," then the same catastrophe's thermal radiation can turn communities into "toast."

If FERC actually requires LNG terminals to "be at least a mile from any public place," then FERC has been violating its own requirements by accepting permit applications from Quoddy Bay LNG (Sipayik, Maine), Downeast LNG (Robbinston, Maine), Weaver's Cove Energy (Fall River, Massachusetts), and several others that are closer than one-mile from public places.

USA: Six LNG cargoes imported in December (Feb 4) — LNG World News

Three cargoes were shipped from Trinidad and Tobago, two from Yemen and one from Norway.

Two cargoes were delivered to the Everett and the Elba Island LNG terminal respectively while the Sabine Pass and the Freeport terminal received one cargo each.

Webmaster's comment: Even with these six December LNG imports, net US imports for 2012 were down 79.8% compared with 2007. Net 2012 imports were close to half (52.7%) of 2011 net imports. US LNG imports are projected to continue falling precipitously.

Seven LNG cargoes re-exported in 2012 (USA) (Feb 4) — LNG World News

[This article also appears under the Gulf of Mexico heading, above.]

The LNG Capricorn departed from the Sabine Pass terminal on December 1, while the Excel LNG tanker left the Freeport terminal on December 18. Both of the cargoes were delivered to Brazil, DOE revealed in its monthly report for LNG imports.

Re-exportation of LNG lets marketers and suppliers store gas [at idle US import terminals], while waiting for price signals [price increases] before delivering their LNG to the higher-paying markets in Asia, Europe, and South America.

Daniel Yergin testifies before US House on Shale Revolution (Feb 5) — Oil & Gas Financial Journal

“What, of course, gets most attention now is the potential for liquefied natural gas (LNG ) exports. This needs to be looked at in terms of overall US supply and global competition. Our view is that, owing to the very large resource base, the market in the US is demand-constrained, rather than supply-constrained. Larger markets—whether they be in electric power, industrial consumption, transportation, or exports— are required to maintain the investment flow into the development of the resources. Many LNG projects for the United States have been announced. These would be expensive facilities to build—$10 billion or more. Only a handful, in our view, are likely to end up being financed and built. The reason is both cost and the scale of global competition.”

U.S. LNG boom fueling port projects — Engineering News-Record, New York, NY

At the beginning of January, 23 developers had applied to export a total of 31.41 billion cu ft (bcf) per day of natural gas—almost half the total of U.S. natural-gas production—to non-FTA countries. While it is assumed that exporting LNG to FTA countries would be in the national interest, DOE must evaluate deals with non-FTA countries on a case-by-case basis. [Red & bold emphasis added.]

ACC remains neutral on LNG exports [Blog] — Houston Business Journal, Houston, TX

After the public fallout between Dow Chemical Co. (NYSE: DOW) and the National Association of Manufacturers when NAM released a statement in January about LNG exports, many were waiting with baited breath for ACC’s statement on the topic.

The ACC took a neutral approach on the topic of LNG exports, stating it supports an “all of the above” approach in regards to domestic energy policy. It is in support of having competitively priced domestic natural gas and natural gas liquids, which supports manufacturing, but it also is in favor of exporting LNG and current trade laws relating to exporting LNG. Under current laws, companies need a federal permit to export LNG.

US House bill would make it easier to export US LNG to NATO members, Japan — Platts

US Representative Mike Turner, Republican-Ohio, on Wednesday introduced legislation that make it easier for US producers to export LNG to a range of countries.

The bill is a companion to legislation introduced in the Senate last week by John Barrasso, Republican-Wyoming and would give North Atlantic Treaty Organization countries and Japan the same status as countries with whom the US has free-trade agreements when it comes to LNG exports.

The bill also would allow exports to other countries if the secretary of state, in consultation with the secretary of defense, decides the exports would help US national security.

Japan's Tepco eyes 2 mil mt/year lean LNG from US, various sources — Platts

Japanese power utility Tokyo Electric Power Company is close to securing a deal to import 2 million mt/year of lean LNG from the US and other sources and has initiated works to set up the necessary infrastructure to facilitate these imports.

Tepco said its latest efforts are part of its 10-year action plan announced in November to import up to 10 million mt/year of lean LNG from sources such as US shale plays in a bid to cut its increasing fuel costs.

In order to cut its import costs, Tepco said it is heading for a heads of agreement on the deal and added that it expects to buy Cameron LNG at prices that are linked to Henry Hub gas prices. This will be Tepco's first LNG term import based on a natural gas price benchmark, the company said. [Red & bold emphasis added.]

Japan may lower LNG costs 10% by importing U.S. fuel, IEEJ says (Feb 5) — Bloomberg

The country, the world’s largest LNG user, may purchase the fuel at $9 per million British thermal units, creating savings of 600 billion yen ($6.49 billion), Akira Yanagisawa, senior economist from the Institute of Energy Economics, Japan, a Tokyo-based research group known as IEEJ, said in a report posted on its website. Prices of the gas to Northeast Asia rose to $19 per million Btu, the World Gas Intelligence, an energy research company, said Jan. 30.

Supplies from the U.S. would cost $9 per million Btu after adding $3 for liquefaction and $2 for shipping to $4 for the price of the fuel, Yanagisawa said, citing statistics from the International Energy Agency. [Red & bold emphasis added.]

Webmaster's comment: At $9 per million Btu, that's $6.45 billion out the window, but exporters have been arguing they would get paid $16 per million Btu as reason for the US Department of Energy to allow LNG exports.

Could any limits on the US export of LNG violate the law? [Blog] (Feb 5) — Platts

[T]he [export] debate ventured into some new ground recently when the US Chamber of Commerce began ramping up its argument that limiting LNG exports may violate the trade law.

“Export restraints not only violate the letter of US trade law and international trade agreements but also their spirit,” Karen Harbert, president and CEO of the Chamber’s Institute for 21st Century Energy, wrote in a January 24 letter to the Department of Energy. “In fact, export restraints implemented by the United States would likely be emulated by other countries and could easily limit US access to key natural resources that are not readily available from domestic sources, undermining US competitiveness.”

New LNG study just one factor in export decisions: US DOE official (Feb 4) — Platts

A recent study highlighting the net economic benefits of US liquefied natural gas exports is not the final word on whether to approve pending export applications, according to a top official at the US Department of Energy.

"We will be considering the study that was done by NERA ... we will be considering the results of the EIA study that was done last year and we will be considering all of the comments as part of a package to help us understand what is the totality of issues," Smith said.

Could shale gas in Europe squeeze LNG exports? (Feb 3) — The Motley Fool

The one issue with developing liquefied natural gas export facilities is the time it takes to build one of these facilities. If Europe starts to tap some of its own shale gas reserves, it could bring down natural gas prices in the region and chip away at the potential profitability of LNG exports.

CLNG president: U.S. can both export LNG and meet domestic gas demand — LNG World News

“Participants in today’s hearing confirmed again that the United States has abundant supplies of natural gas and more than enough to allow for exports while also meeting growing domestic demand. The ability to export natural gas represents a window of opportunity to create more jobs, generate more public revenues and reduce our trade deficit. We can reap those benefits as soon as the U.S. Department of Energy officially resumes the approval process for proposed LNG export projects.”

Webmaster's comment: Center for LNG president Bill Cooper will advocate for anything that brings greater profits to US LNG industry participants, regardless of impacts on anyone else.

LNG exports won't hurt U.S. price advantage, speaker says — Houston Chronicle, Houston, TX

Speaking during the NAPE Business Conference, part of the NAPE Expo at the George R. Brown Convention Center, Behravesh said the differentials in price between natural gas in the U.S. and in Asia or Europe "are so huge that it's almost irresistible."

Expanded Panama Canal bets on US LNG run to Asia (Feb 4) — Business Times, Singapore

[LONDON] Six years after the Panama Canal began a US$5.25 billion expansion to capture shipments of Asian-made goods to the US East Coast, the flow of liquefied natural gas in the opposite direction promises to be a better bet.

The shift shows how rising US shale-gas output is reshaping global energy markets. The Panama Canal enlargement is central to the change because the route cuts voyages by more than 7,500 nautical miles to Asia, where fuel demand is growing fastest. [Red & bold emphasis added.]

Mexico

Peru ships LNG cargo to Mexico (Feb 5) — LNG World News

The 173,000 m3 Ribera del Duero Knutsen departed from the Peru LNG terminal on February 3, and it is due to arrive at Mexico’s Manzanillo terminal on February 9.

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2013 February 1

Southeast

Tepco to buy US shale gas via Mitsubishi, Mitsui - Nikkei — Reuters

Mitsubishi and Mitsui are in negotiations with Cameron LNG, an affiliate of U.S. power and gas concern Sempra Energy , to outsource liquefaction operations for North American shale gas, the business daily said.

The company plans to diversify LNG procurement by turning to Canada, South America and other regions, the daily reported.

Opinion: Elba Island's economic impact significant [Editorial] (Jan 31) — Savannah Morning News, Savannah, GA

Once various corporate and regulatory approvals have been received, Shell and Kinder Morgan affiliates have agreed to modify the Elba Express Pipeline and Elba Island LNG Terminal to physically transport natural gas to the terminal, liquefy it and load it onto ships for export.

Construction is expected to start within the next two years, with the first exports flowing out by the end of the decade.

Caribbean

Final decision next week on alternative source of energy — Jamaica Information Service, Jamaica, West Indies

Addressing students and energy stakeholders at a seminar on energy management at the University of Technology’s (UTech) Papine campus on January 31, [Minister of Science, Technology, Energy and Mining, Hon. Phillip Paulwell]l informed that Thursday, January 31 was the final day for the Jamaica Public Service Company (JPS) to “complete its process of determining and convincing the Office of Utilities Regulation (OUR) that it has a Liquefied Natural Gas (LNG) solution.”

“And by next week we intend to signal to the country, once and for all, the way forward in relation to whether it’s going to be LNG or some other fuel,” he said.

Energy Minister on Repsol’s asset sale: Part of global divestment — The Trinidad Guardian Newspaper, Trinidad and Tobago, West Indies

“Repsol is selling its LNG assets in Trinidad not because Trinidad is unattractive. Repsol, as you know, had their YPF assets expropriated by the Argentine government two years ago. That has caused the company great distress."

Alaska

Murkowski working on making in-state LNG line more feasible — AlaskaPublic.org, AK

Senator Murkowski introduced a bill that would allow a seven-mile stretch of pipeline to run through the National Park. For that to happen, Congress needs to pass a law granting approval.

The pipeline would be buried through the park’s industrial corridor. Jim Stratford says the plan presents the best possible option. He’s the regional director for the National Parks Conservation Association.

“This did nothing to resolve whether or not we even do it,” Murkowski said. “When you’re looking at alternate routes, if one route is complicated because of the proposed path, if you can correct that ahead of time so that’s not an issue, it doesn’t take away the big issue, which of course, is the price tag.”

Webmaster's comment: The 800-mile natural gas pipeline would deliver gas from Alaska's North Slope to state natural gas customers, as well as to an LNG export terminal, and could cost $60 billion.

British Columbia

Chevron stands off with LNG buyers over pricing, warns projects at risk — Financial Post, Don Mills, ON

CALGARY — Chevron Corp. is taking a hard line with Asian utilities and other potential buyers seeking cheaper prices on exports of liquefied natural gas from Canada’s West Coast, warning that unless sales are indexed to oil prices “the projects won’t get built.”

North American gas producers are scrambling to build export capacity to escape a crippling supply glut that has battered share prices and hastened asset sales.

At the same time, energy-hungry Asian utilities have begun pushing for LNG sales deals linked to distressed North American gas prices, which have plunged as record volumes of shale gas swamped markets. Sales of LNG in Asia-Pacific markets typically fetch a premium because they are linked to a higher-priced basket of crude oil blends.

Webmaster's comment: Japan is expecting the Supply and Demand principle to determine pricing — the same principle that Big Oil uses (in part, by exporting US gasoline) to keep US gasoline prices high. Ironically, Apache and Chevron are now having a problem with how that principle works.

Planning feared to be first casualty in rush to export energy through pipelines — The Vancouver Sun, Vancouver, BC

Former logger Randy Shoop has worked for decades in the wilderness of the Coast Mountain range south of his Hazelton home, where at least two of the half-dozen oil and gas pipelines proposed by energy companies are expected to pass.

But for the life of him, Shoop can’t imagine how any pipelines could safely transit through a region he believes to be one of the most geologically unpredictable in the province.

...The back sides of all of those mountains, at one time or another, have slid. And you see these big fissures that go down in the ground. You could throw a rock down there and you can’t even hear it stop.

“We have to move away from a higgledy-piggledy planning approach to a modicum of planning so we don’t trip over our own two feet,” he said. “You can only have so many pipeline corridors across British Columbia; there’s only so much water to produce the natural gas. The airshed in Kitimat can only take so much pollution. And you have to sort some of this out in advance, say, for example, so you don’t use up the Kitimat airshed for one LNG facility, thereby preventing the possible construction of two or three.”

This week, the chiefs of the Carrier Sekani Tribal Council issued a warning that they have not been consulted about the pipelines. [Red emphasis added.]

B.C.’s major energy export projects — The Vancouver Sun, Vancouver, BC

[The list below are all proposed British Columbia LNG export terminal projects. —SPB webmaster]

LNG Canada: Royal Dutch Shell/ Mitsubishi/Korea Gas/PetroChina...

BC LNG: Chevron/Apache...

Progress Energy Canada/Petronas...

BG Group (formerly British Gas)...

Douglas Channel Energy Partnership...

Exxon Mobil...

Province wants northwest B.C. municipalities involved in LNG benefits — Terrace Standard, Terrace, BC

As many as five natural gas pipeline construction or expansion projects and an accompanying number of LNG plants at both Kitimat and Prince Rupert are in the works carrying a price tag in the tens of billions of dollars.

[The City of Terrace is] arguing that while development takes place outside of municipal taxation boundaries, municipalities are often hard-pressed to provide services needed as populations and economic activity increases. [Red emphasis added.]

United States

Lawmakers propose making LNG exports automatic — Fuel Fix

When it comes to natural gas exports, the legislation would put Japan and the 28 members of NATO on the same footing as nations that have free-trade agreements with the United States. The Energy Department is required to approve applications to sell U.S. natural gas to those free-trade partners under current law, but exports to other countries aren’t automatic.

The legislation would require the Secretary of Energy to approve exports of natural gas to NATO allies and Japan, which is hungry for natural gas to replace nuclear power after the 2010 Fukushima accident. It also would require approval of natural gas exports to any other country where the secretaries of Defense and State determine they would promote the United States’ national security interests, such as by blunting the ability of unfriendly nations to use their own natural gas resources as political leverage.

The measure faces some big obstacles on Capitol Hill, including Sen. Ron Wyden, D-Ore., the head of the Senate Energy and Natural Resources Committee. Wyden isn’t eager to relax the standard for approving LNG exports; he has said the current practice of automatically allowing exports to free-trade nations itself needs review.

Senators: Give green light to gas exports — US News and World Report

The move steps up the fundamental debate over whether the country should pursue large-scale exports of its newfound abundance of natural gas. Proponents say it would create thousands of jobs, reduce the trade deficit, and enhance national security. Opponents argue shipping large amounts of natural gas abroad could cause price hikes for consumers and manufacturers, many of which have benefited from cheap natural gas prices.

Still, expedited permits or not, a host of other obstacles stand in the way of large-scale natural gas exports to Asia and Europe, not least of which are expensive pipeline and export terminal infrastructure. According to some estimates, new export facilities cost about $20 billion dollars and the water-borne tankers needed to ship the liquefied natural gas to markets abroad run about $200 million per ship.

U.S. Senators introduce Expedited LNG for American Allies Act — LNG World News

By making it easier to export LNG, the bill would help increase energy security among U.S. allies and help reduce their need to purchase oil and gas from countries such as Russia and Iran.

Bill in US Senate to export natural gas to non FTA-nations — Zee News, Noida, India

The then External Affairs Minister S M Krishna discussed the issue of shale gas with Secretary of State Hillary Clinton in New York last October. India wants its companies should be able to import shale gas in liquefied form through containerised vessels, as it does with LNG from Qatar.

Reshaping Panama Canal trade means boom in U.S. gas to Asia — Bloomberg

Six years after the Panama Canal began a $5.25 billion expansion to capture shipments of Asian- made goods to the U.S. East Coast, the flow of liquefied natural gas in the opposite direction promises to be a better bet.

What the canal didn’t foresee when it planned the expansion was the rise of shale gas, produced from hydraulic fracturing of rocks, Quijano said. The extraction method boosted U.S. gas output by 30 percent in the past five years and so-called tight- oil production by 20 percent, according to BP Plc (BP/)’s Energy Outlook 2020, released this month. The nation will become a net exporter in 2017, according to Europe’s second-biggest oil company. Liquefaction chills the fuel into a liquid for transport by sea.

Locks that are 66 percent wider and 43 percent deeper will be able to accommodate about another 2,600 dry-bulk ships, oil tankers and LNG carriers, according to fleet data from IHS Fairplay compiled by Bloomberg. About 80 percent of the world fleet of 369 LNG carriers fit the new locks’ dimensions, from less than 10 percent today, the data show. [Red & bold emphasis added.]

The shale gas revolution and the global commons (Opinion interview) — International Relations and Security Network (ISN), Zurich, Switzerland

I do not expect shale gas or oil sands to have a profound impact upon securing the maritime commons any time soon. As argued above, the maritime posture of the US and China develops independently from the unconventional revolution. The US has many reasons to stay involved in the Middle East, whereas China is focusing on claims in its vicinity for now. Beijing may, in time, have more of a vested interest in guaranteeing maritime security, especially as it develops its raw materials interests in Africa. But depending on how political relations evolve, an agreement with the US might also be in the cards. However, this seems a long way off from today’s situation.

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