'NEXT WAVE OF GLOBAL LNG' COULD BE IN THE WORKS
The Derrick Digest is a weekly collection of curated content, based on events from across the oil and gas industry, that caught our eye at Pennine Petroleum Corporation.
Enjoy and share!
APRIL 28, 2017
In what U.S. Secretary of Energy Rick Perry calls “another example of President Trump’s leadership in making the United States an energy-dominant force,” the U.S. Department of Energy (DOE) has given the go-ahead to a liquefied natural gas export terminal on the coast of Texas.
Golden Pass received approval this week to export up to 2.21 billion cubic feet per day of LNG to non-free trade agreement (FTA) countries. If the project is built, Bloomberg New Energy Finance analyst Anastacia Dialynas has said in a report that “it could signal the next wave of global LNG.”
The existing facility in Sabine Pass, Tex. was conceived as an import terminal in 2009. The green light from the DOE gives the facility’s owners — affiliates of Qatar Petroleum (70 per cent) and ExxonMobil (30 per cent) — the ability to import or export natural gas in response to the market. The project’s total anticipated export capacity will be 15.6 million tons of LNG per year, across a total of three liquefaction process trains.
“As numerous studies have demonstrated, including one by the Department of Energy from 2015, increased LNG exports will result in overall economic benefits to the United States upwards of $20 billion in average annual GDP growth through 2040,” the Center for Liquefied Natural Gas’ executive director Charlie Riedl said in response to the announcement.
The Industrial Energy Consumers of America organization, however, is worried that the emphasis on exporting the country’s natural gas will lead to price spikes at home. They sent a letter to Perry recently, concerned that large industrial natural gas users such as Dow and Dupont would be negatively affected by a robust export agenda.
Golden Pass is expected to begin exporting by 2021, and achieve full export capacity of 15.6 million tons per year by 2022. The project is expected to create 45,000 direct and indirect jobs during the five-year construction phase, and 3,800 direct and indirect jobs during the facility’s 25-year operational activity.
Speaking earlier this week at the Bloomberg New Energy Finance Conference in Manhattan, Secretary Perry said he supports America remaining in the Paris Accord, but renegotiating its terms. He called out Germany for raising its emissions levels while “cheerleading” the Accord.
“Don’t sign an agreement and expect us to stay in if you’re not really going to participate and be a part of it,” Perry said. “We need to renegotiate it. They need to get serious.”