Energy Tomorrow Blog
Competing to Win in Global LNG Export Market
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Mark Green
Posted August 2, 2016
Gaining strength is the argument that the United States should move as expeditiously as possible on liquefied natural gas (LNG) export infrastructure that would help secure America’s place in the emerging global LNG market.
The added heft is seen in two ways. First, the initial U.S. shipment of LNG passed through the newly expanded Panama Canal last week, underscoring a point made in this postthat the widened canal will shorten voyage times from U.S. LNG export facilities on the Gulf Coast to Asia and the western coast of South America, boosting the competitiveness of U.S. suppliers. Reduced voyage time means quicker turnaround times, leading to better service and a boost to U.S. competitiveness.
Secondly, an International Energy Agency (IEA) report projects the U.S. will become the world’s third-largest LNG supplier in five years, behind Qatar and Australia.
Panama Canal Expansion and U.S. LNG Exports
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Mark Green
Posted July 5, 2016
A newly expanded Panama Canal is open for business.
It’s noteworthy, as federal official say, that the enlarged canal can handle the vast majority of the world’s liquefied natural gas (LNG) tankers while significantly shortening travel time and transportation costs for U.S. LNG suppliers to key overseas markets. This is huge for U.S. LNG exports, offering another strong argument for swifter federal approval of pending LNG export projects.
Amplifying the Pro-Infrastructure Message
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Mark Green
Posted May 2, 2016
This wonderful domestic energy abundance and the global LNG market opportunities could be impacted by challenges facing infrastructure expansion here at home. America needs more energy infrastructure to move domestic supply to all areas of the country, for residential consumers, power generators and manufacturers. Yet, without stronger high-level backing, we could see these infrastructure needs delayed or rejected, as occurred last month with the proposed Constitution natural gas pipeline in New York.
Americans overwhelmingly support more energy infrastructure, and there appears to be bipartisan consensus for it in Congress. But infrastructure projects are being targeted by a vocal minority – even though increased domestic use of natural gas is the leading reason the United States is leading the world in reducing carbon emissions. A key going forward is gaining infrastructure support from the White House and the administration, said Marty Durbin, API’s executive director for market development.
Matching Energy Policy with Energy Reality
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Mark Green
Posted April 28, 2016
Bringing home recognition of the U.S. energy renaissance and its benefits to policymakers in Washington is critically important. Sustaining and growing the domestic surge in oil and natural gas production depends on forward-looking leadership and sound policies.
No less critical is increasing Americans’ buy-in on the golden opportunity to foster economic growth well into the future, create jobs, produce consumer savings and strengthen U.S. standing in the world, all thanks to more home-grown energy – and all occurring as the United States leads the world in reducing carbon emissions.
U.S. LNG, the Global Market
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Mark Green
Posted March 21, 2016
Interesting weekend remarks from the Energy Department’s deputy secretary on U.S. oil and natural gas exports to Europe – especially so because DOE is the key federal agency in allowing domestic liquefied natural gas (LNG) export projects to proceed.
Energy Deputy Secretary Elizabeth Sherwood-Randall was speaking at a forum hosted by the German Marshall Fund in Brussels, Belgium, when she discussed the dramatic change in energy markets caused by the U.S. shale revolution. Sherwood-Randall:
“What’s really changed in the global energy landscape is American abundance of supply of both oil and gas. … We are now poised to become significant exporters of both oil and natural gas. We began the export of natural gas just last month, and we are also beginning to export oil.”
Natural Gas Exports Set to Boost Economy, Security
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Jack Gerard
Posted February 24, 2016
Two separate but related news items last week demonstrate the economic promise and geopolitical significance of America’s natural gas export opportunity.
The first headline, “U.S. LNG Set to Hit Global Market,” signifies a landmark moment in America’s trajectory from energy scarcity to abundance. The export facility covered in the article – Cheniere Energy’s Sabine Pass in Cameron Parish, La. – actually opened as a liquefied natural gas (LNG) import terminal in 2008. Just two years later in September 2010, it became the first U.S. facility to apply for a Department of Energy permit to export LNG. After a decade that saw U.S. natural gas production jump 45 percent – and following an extensive review process – Sabine Pass is set to ship its first cargo to Europe.
America’s Natural Gas Progress and Its Discontents
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Mark Green
Posted February 10, 2016
Yesterday, we took a look at the effects of the U.S. energy revolution on domestic oil production and the impact of that production on U.S. oil imports – and the resulting progress for America in terms of increased economic and consumer benefits and energy security. We argued that Obama administration policies risk retreating from progress that’s the result of the historic, game-changing shift in the U.S. energy outlook, thanks to America’s energy revolution.
Today, a look at natural gas, where the impacts of the energy revolution are no less significant.
Our LNG Exports Signal From Iran
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Mark Green
Posted February 1, 2016
Iran’s plan to export liquefied natural gas (LNG) within two years is what you call a market signal, one that should cause U.S. policymakers to reconsider the ponderous pace with which proposed U.S. LNG export projects are gaining federal approval. The Wall Street Journal reported:
Iran is pushing to find new ways to extract and export its vast natural-gas reserves, including developing facilities to liquefy the commodity and ship it to Europe in two years now that western sanctions are no longer in place, according to a top Iranian official. Iran holds the world’s largest reserves of natural gas, but has long lacked the export infrastructure of competitors like Russia and Qatar. … Tehran is exploring several options to help the country “join the international LNG club,” said Alireza Kameli, Managing Director of National Iranian Gas Export Co., in an interview here.
Options for Iran include restarting its own advanced LNG export project that was halted in 2012 because of the western sanctions; building a pipeline under the Persian Gulf to Oman, which has LNG export facilities Iran might be able to use; and the construction of floating LNG facilities. Iranian officials say the country could export about 30 billion cubic meters (more than 1 trillion cubic feet) to the European Union long-term, the Journal reported.
While experts may disagree over how soon Iranian LNG exports could reach global markets, it makes sense for the United States – the world’s leading natural gas and oil producer – to capitalize on its natural gas abundance by speeding up federal approvals for domestic LNG exports to non-Free Trade Agreement countries. While a number of LNG export projects have received the go-ahead from Washington in the past couple of years, final non-FTA authorizations for more than 20 facilities remain under review at the Energy Department.
The Impact and Reach of U.S. Natural Gas
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Mark Green
Posted January 11, 2016
A couple of data points from the U.S. Energy Information Administration (EIA) that help illustrate the impact of the natural gas portion of the American energy revolution.
First, EIA reports that wholesale electricity prices at major trading hubs, on a monthly average for on-peak hours, were down 27 percent to 37 percent across the U.S. in 2015 compared to 2014. The reason for the decrease, EIA says, is lower natural gas prices.
Now, let’s zero in on the increasing affordability of natural gas in electricity generation. Recently, EIA reported that 2015 natural gas spot prices at the national benchmark Henry Hub averaged $2.61 per million Btu (MMBtu), the lowest annual average since 1999. Interestingly, declining prices did not result in lower production, EIA says.
Exports: A New Day for U.S. Energy
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Mark Green
Posted January 4, 2016
As we write, the United States is once again an exporter of crude oil. Sure, in the past the federal government has allowed limited crude exports. The oil tanker that left the Port of Corpus Christi, Texas, late last week is the bearer of the first freely traded U.S. crude in about four decades – made possible by congressional legislation that President Obama signed to end a 1970s-era ban on exports. It’s a new day indeed.
But wait, there’s more. Cheniere Energy says it has begun liquefying natural gas at its new export terminal in Louisiana, setting the stage for its first LNG export cargo this month.
Both are big-time energy developments for the United States – opportunities created by a domestic energy revolution largely driven by safely harnessing vast shale reserves with advanced hydraulic fracturing and horizontal drilling.