Energy Tomorrow Blog
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.
Posted May 23, 2016
New figures from the U.S. Energy Information Administration show the United States remained the world’s No. 1 producer of oil and natural gas in 2015, a position the U.S. has held since 2012.
Several important points here, supporting the idea that U.S. world energy leadership is a big thing.
First, U.S. production of oil and natural gas grew last year despite continued low prices for crude last year. U.S. output of petroleum and other liquid fuels grew from 14.08 million barrels per day in 2014 to 15.04 million barrels per day in 2015. According to EIA, natural gas production rose from 74.89 billion cubic feet per day (bcf/d) in 2014 to 78.94 bcf/d in 2015, or about 13.99 million barrels of oil equivalent per day.
The second point is the vast majority of U.S. energy production is the result of safe and responsible hydraulic fracturing and modern horizontal drilling – fracking.
Posted May 17, 2016
The United States in 2040 will be more energy self-sufficient, a net energy exporter and a lower source of energy-related carbon emissions as clean-burning natural gas becomes the dominant fuel for generating electricity. The leading energy source 24 years into the future – as they are now – will be oil and natural gas.
So projects the U.S. Energy Information Administration (EIA) in an early look at select data from EIA’s Annual Energy Outlook 2016 report that’s scheduled for full release in July.
The main takeaway from EIA’s “sneak preview” is the importance of the U.S. energy revolution – primarily oil and natural gas developed from shale and other tight-rock formations using safe hydraulic fracturing and modern horizontal drilling. The United States is stronger now and will be in the future thanks to domestic energy from fracking.
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.
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.
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.”
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.
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.
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.
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.