Tag Archives: LNG

Pipeline Construction Expansion Expected – LNG

New oil and gas gathered at shale plays already has had a significant impact 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.

A report from consulting firm within the energy industry, estimates that between 2013 and 2017, companies are expected to spend $216 billion on onshore pipeline projects.

The new estimate is an increase of 12 percent compared to onshore pipeline expenditures during the past five years.

Due to the rising global energy demand, oil and gas production is expected to increase, the report said.

Because of this increase in production, companies around the U.S. are already investing in more pipelines to transport oil and gas from shale plays to refineries on the Gulf Coast. For example, Tenaris SA (NYSE: TS), a Luxembourg-based steel pipe manufacturer that has its North American headquarters in Houston, just reveled Feb. 15 that it would spend up to $1.5 billion on a new steel pipe plant just outside of Houston. The driving force behind this plant was increased oil and gas production in areas such as the Eagle Ford Shale play in south Texas.

However, other countries besides the U.S. are hankering for natural gas produced in U.S. shale plays. If the U.S. approves more permits for LNG to be exported to these areas, this could increase the demand for pipelines even more than the current demand.

SOURCE: http://www.bizjournals.com/houston/blog/nuts-and-bolts/2013/02/lng-expected-to-drive-pipeline.html?page=all


Community Minister Bennett predicts a natural gas boom as way cleared for LNG plant

British Columbia is on the verge of a natural gas development boom that will rival anything Alberta has experienced, according to B.C.’s Community Minister.

Bill Bennett made that comparison Tuesday while speaking at a press conference to announce the final regulatory pieces have fallen in place for a new liquefied natural gas plant to be built on a native reserve near Kitimat.

The massive LNG plant, a joint venture by Apache Canada Ltd. and Chevron Canada Ltd., in co-operation with the Haisla First Nation, will process nearly 700 million cubic feet of gas per day, becoming a key link in the transportation chain between B.C.’ s northeast gas fields and off-shore markets.

Mr. Bennett said the plant, the first of six that have been proposed for the West Coast, will open up B.C.’s massive gas fields and allow the resource industry to thrive like it never has before in the province.

“The story here is a story about British Columbia exploiting an opportunity … on the scale of what faced Alberta 40 to 50 years ago,” Mr. Bennett said.

“The opportunity for B.C. really is on the same scale as for example, Norway, when they discovered they had off-shore oil [and gas discoveries] and Alberta when they discovered they had oil and could ship it to the U.S.,” Mr. Bennett said.

He said both Alberta and Norway have thrived economically because of the way their governments regulated and encouraged the development of rich oil and gas resources.

“It’s built [Alberta’s] economy and made them, you know, the most [economically] comfortable province in Confederation.

“It’s that scale of an opportunity [for B.C.],” he said.

Last month Apache Canada and Chevron Canada announced they were teaming up to develop gas fields in the Horn River and Liard basins, in northeast B.C.

Apache Corp. chairman Steven Farris has described those fields as “two of the most prolific shale gas plays in North America, with more than 50 trillion feet of resource potential.”

At a press conference in Vancouver, Mr. Bennett and John Duncan, federal Minister of Aboriginal Affairs and Northern Development, jointly announced regulatory changes that they said have now cleared the way for construction of the Kitimat LNG plant.

Haisla Chief Councillor Ellis Ross praised both levels of government and industry for working with the band to bring the project forward.

“Our people have been looking at natural gas projects since the 1980s … this is a small example of what can be done if all … four parties are focused,” he said.

Mr. Bennett said the regulatory changes allow the province to enforce provincial environmental standards on reserve lands, which are technically under the jurisdiction of the federal government.

Tim Wall, president of Apache Canada, said the change provides “regulatory certainty” for the Kitimat LNG plant, allowing construction to proceed.

“It’s unusual to be here celebrating regulations,” said Mr. Bennett, who has a reputation for battling red tape.

Mr. Bennett, whose government is trailing in the polls as it seeks re-election in May, said developing B.C.’s gas fields is of “profound” economic importance to the province.

“It’s huge and it has the potential to change the frame for British Columbia in terms of the jobs [created],” he said.

Mr. Bennett said the chronic unemployment problems that burden many small northern communities, particularly native communities, could be relieved by the development of B.C.’s gas fields.

SOURCE: http://www.theglobeandmail.com/news/british-columbia/bennett-predicts-a-natural-gas-boom-as-way-cleared-for-lng-plant/article7649911/?utm_source=Shared+Article+Sent+to+User&utm_medium=E-mail:+Newsletters+/+E-Blasts+/+etc.&utm_campaign=Shared+Web+Article+Links

5 Billion Pipeline Project – Awarded to TransCanada

TransCanada Corp said Wednesday it has been chosen by Progress Energy Canada Ltd. to build, own and operate a 5 billion Canadian dollar ($5.1 billion) pipeline project that would transport natural gas to a new liquefied-natural-gas export terminal planned off Canada’s west coast.

The Pacific Northwest LNG export terminal in British Columbia was proposed as part of the multi-billion takeover of Progress Energy Resources Corp. by Malaysian state-run energy giant Petroliam Nasional Bhd, which closed last month.

Calgary, Alberta-based TransCanada said it expects to finalize definitive
agreements for the Prince Rupert Gas Transmission project early this year. The proposed pipeline will transport natural gas primarily from the North Montney gas-producing region near Fort St. John, British Columbia to the LNG export facility, which is aimed at exporting natural gas to Asian markets.

The pipeline company also said it’s planning to extend its existing NOVA Gas Transmission Ltd. system in northeast British Columbia to connect both to the Prince Rupert Gas Transmission project and to additional North Montney gas supply from Progress and other parties. It estimates initial capital costs for the extension at about C$1 billion to C$1.5 billion.

Before Petronas closed its takeover of Progress, the two had said they were moving their LNG export project into the next phase of engineering and said a final investment decision would be made in late 2014. First LNG exports are targeted for 2018.

Natural Gas to Be Most-Used Fuel in U.S. by 2030, IEA Says

Natural gas will overtake oil as the most-used fuel in the U.S. by 2030 as the country’s supplies balloon, the International Energy Agency said.

So-called unconventional gas, extracted from sources including shale rock and coal beds, will account for almost half of the increase in global output of the fuel by 2035, the Paris- based adviser to 28 industrialized nations said today in its World Energy Outlook. U.S. production will rise 23 percent and supply most of the growth along with China and Australia.

A boom in supplies of natural gas trapped in shale has reduced prices to a 10-year low of $1.902 a million cubic meters in April on the New York Mercantile Exchange. U.S. producers including Cheniere Energy Inc. (LNG)have proposed liquefied natural gas export terminals to meet demand in Asia.

“The place that’s going to be cheapest for gas exports is the U.S. and Canada,” Thierry Bros, an analyst at Societe Generale SA in Paris, said today by phone.

The U.S. will begin exporting around 2018, Fatih Birol, the IEA’s chief economist, said today at a press conference in London. Its external shipments will reach 19 billion cubic meters in 2020, compared with imports in 2010 of 76 billion cubic meters, the agency estimated in the report. North American exports will be 35 billion cubic meters, it said.

U.S. production will rise to 800 billion cubic meters in 2035 from an estimated 650 billion this year, the IEA said.

“The U.S. Department of Energy is waiting to review the results of a price impact study before dealing with the pending export applications,” the IEA said.

U.S. Exports

The agency assumes 93 percent of the U.S. gas remains available to meet domestic demand, with prices reaching $5.50 per million British thermal units by 2020. Front-month gas was at $3.52 per million Btu in New York today.

Diversifying sources of supply, can “accelerate movement toward more diversified trade flows, putting pressure on conventional gas suppliers and on traditional oil-linked pricing mechanisms for gas,” the IEA said.

Asia will ultimately seek lower prices for LNG, which is currently linked to oil in some sales contracts, and that pressure will be felt by the end of the decade, the IEA said.

The margin achievable by U.S. exporters to Japan in 2020 will shrink to $4.30 per million Btu, from $6.10 per million Btu in 2011, according to the report.

Global gas consumption may rise 19 percent by 2017 from 2010 levels as demand surges in Asia and the U.S. while Europe’s usage drops 1.6 percent, the agency said in June. China’s gas consumption will more than quadruple from last year’s level by 2035, boosted by regulatory reforms and policy support, the IEA said. Demand will also rise in India and the Middle East while growth in Japan is limited by higher prices and a focus on renewable sources and energy efficiency.

SOURCE: http://www.businessweek.com/news/2012-11-12/natural-gas-to-become-largest-fuel-in-u-dot-s-dot-by-2030-iea-says