LNG Energy has an agreement to drill and test an exploratory well in the Middle Jurassic Etropole Shale of Northwestern Bulgaria. Gas sells for about $10/Mcf in Bulgaria.
More in the Oil and Gas Journal.
Natural Gas Markets
LNG Export from Sabine Pass, LA/TX
“DOE issued conditional authorization to Cheniere Energy’s application to export LNG from its Sabine Pass terminal in Louisiana. Cheniere plans to retrofit the existing import terminal to give it liquefaction capability. Cheniere has been authorized to export up to 2.2 Bcf/d of natural gas from the facility for a period of 20 years.” Quoted from the Energy Information Administration Weekly Natural Gas Update.
US Imports of Natural Gas Drop Sharply
“Net imports of natural gas continue at much lower levels than in previous years, likely as a result of higher U.S. domestic production. [...] During the report week, net Canadian imports averaged 5.3 Bcf per day, which is 20.7 percent lower than the same week in 2010. Sendout from U.S. liquefied natural gas (LNG) import terminals averaged about 1.1 Bcf per day during the report week, or 8.2 percent lower than the same week in 2010.” Quote from the Energy Information Administration’s Natural Gas Weekly Update.
LNG: Yesterday’s Customers are Today’s Competitor
An article on the EnergyTribune.com website reviews how just a few years ago LNG terminals were being built in the United States to receive liquefied natural gas, yet today some of those same terminals and more are candidates for exporting the same commodity.
How Cheap is Natural Gas in the United States?
“Outside the United States, Canada, and the United Kingdom, almost all wholesale natural gas is sold under long-term contracts. The price of natural gas within the contracts is commonly determined by a formula that links the natural gas price to the price of crude oil or some oil-based product.” In those countries the price of natural gas is generally a lot higher than spot prices in the USA. Quote from the Congressional Research Service report.
The International Movement of Natural Gas
The Congressional Research Service has a new report that addresses the international movement of natural gas. About 70% of the natural gas produced is consumed in the same country. This leaves 30% of all gas production moving via international trade. This trade occurs through pipelines and LNG shipments. The map below shows the global pattern of the international natural gas trade.
Image by the Congressional Research Service
Annual Energy Outlook 2011
The U.S. Energy Information Administration has released Annual Energy Outlook 2011. Interesting items reported…
- U.S. shale gas resources are more than twice the volume reported for 2010
- Increase of the limit for blending ethanol into gasoline for approved vehicles from 10% to 15%
- Growing use of renewable technologies and fuels
Exporting Shale Gas From the United States
The United States has either a short-term glut or a long-term supply of shale gas. An article on Platts.com explores the idea of exporting shale gas from the United States. There are political and commercial perspectives.
Foreign Ownership of United States Gas Shales
A letter published in The Ithaca Journal complains about the many foreign companies who have purchased major stakes in United States gas shale companies.
Energy Sources and Uses
Lawrence Livermore National Laboratories has a very interesting chart that maps energy sources such as natural gas, solar and coal with energy uses such as electricity generation, residential, transportation, etc. Check it out.
Spot Prices for Natural Gas Rose in 2010
“Wholesale spot natural gas prices rose across the country in 2010. Average spot natural gas prices at the Henry Hub—a key benchmark location for pricing throughout the United States—rose about 12% in 2010 but still averaged under $4.50 per million British thermal units (MMBtu).” Quoted from the Energy Information Administration article.
Growing Natural Gas Production in the USA
“Total marketed natural gas production grew strongly throughout 2010 (4.4 percent), increasing from 59.7 Bcf/d in January to an estimated 63.7 Bcf/d in December. Year-over-year growth in 2011 is expected to slow considerably to just 0.8 percent as an increase of 1.0 Bcf/d in the lower-48 states is partially offset by a decline of 0.4 Bcf/d in the Gulf of Mexico.” Quoted from the Energy Information Administration’s Short Term Energy Outlook.
Qatar’s Growing LNG Market Share
“Qatar exported 1,800 billion cubic feet (Bcf) of liquefied natural gas (LNG) in 2009, about 20% of total global trade, based on analysis in EIA’s recently released Qatar County Analysis Brief. Qatar’s annual LNG exports are equivalent to 8% of U.S. annual marketed natural gas production. Qatar has 14% (896 Bcf) of the world’s estimated proved natural gas reserves and is the world’s leading supplier of LNG. Qatar, located in the Persian Gulf, is also a member of the Organization of the Petroleum Exporting Countries and produces about 800,000 barrels per day (bbl/d) of crude oil.” Chart and quote from the Energy Information Administration
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More Pipeline Capacity Needed in the Northeast
“Through January of this winter, spot natural gas prices at Atlantic Coast trading points are up $0.90-1.20 per million British thermal units compared to the same period last winter – although prices are lower at Henry Hub and in other traditional consumption areas like the Midwest and western Pennsylvania. The main reason is congestion on pipelines into the Northeast.” Quoted from the EIA website.
The World’s Largest LNG Producer
Shell and Qatar Petroleum’s Qatargas joint venture has shipped its first cargoes of LNG from Qatar to Gujarat in northern India. Qatargas has now become the world’s largest LNG producer. More at AME.
Energy Use in the United States
The United States has a greater fuel diversity today than at any time in its history. There are also more options available for future growth, yet this is also a time of great concern about energy choices for the future. More at Geology.com.
Shaleblog and Geology.com are owned by Digital Map Store.
Natural Gas Shortage in Arizona & Underground Storage
“An estimated 18,500 southern Arizonans are without natural gas to heat their homes and service may not be restored until next Tuesday. The problem appears to be huge demand for gas nationwide due to the massive storm affecting most of the country. [...] Meanwhile, plans are under review to create huge caverns in salt deposits below the Picacho basin in Pinal County north of Tucson, to store natural gas under pressure to use during times of peak demand.” Quoted from the Arizona Geology Blog.
WV Marcellus Shale Impact: Economic, Legal, Regulatory, Environmental
A study on the economic, legal, regulatory, and environmental issues related to development of the Marcellus Shale has been published by the West Virginia University College of Business and Economics, Bureau of Business and Economic Research.
Qatar Oil and Gas Summary
Qatar is a major exporter of oil and natural gas. Those commodities account for over half of the country’s GDP. Qatar ranks third worldwide in natural gas reserves and is the world’s leading exporter of liquefied natural gas. More at the Energy Information Administraion website.
China is Working on LNG Export Technology
China, the world’s top energy consumer, is developing technology that would enable them to build an LNG export facility in Iran. This would be the first LNG export facility built by a Chinese company and would give them access to abundant but politically risky gas from Iran. More at Yahoo! Finance.
Is Congress Neglecting Natural Gas?
In a blog post on the Reuter’s.com website, Christopher Swann, argues that Washington could take easy steps to reduce America’s dependence on foreign oil, reduce carbon emissions and save citizens money by promoting the use of natural gas in vehicles and electricity generation. He thinks that the natural gas lobby needs to work harder than those promoting coal and railroads.
Proppant Shortage!
An article on Bloomberg.com reports that the proppants used in hydraulic fracturing of oil and gas wells are in short supply. Proppants are tiny particles such as ceramic or aluminum beads that are injected into a well to hold artificial fractures open. It is not unusual for a hydraulic fracturing job to require a million pounds of proppants.
Large Gas Field May Make Israel an Exporter
A major gas field discovered in the Mediterranean off the coast of Israel may convert the country from a major importer of natural gas to a significant exporter. More in the Houston Chronicle.
Acquisitions Driven by Low Natural Gas Prices
A Reuters article reports that 2010 was a record year for worldwide acquisitions in the oil and gas industry. Low natural gas prices produced bargains in the shale and tight sands sectors.
