
Boom in American Liquified Natural Gas Is Shaking Up the Energy World - fhood
https://www.nytimes.com/2017/10/16/business/energy-environment/liquified-natural-gas-world-markets.html
======
Animats
The downside is that gas fields are depleted relatively rapidly. There's less
of a long tail than with oil. Oil wells tend to degenerate into "stripper
wells", producing a few barrels a day. The US has about a million of those.
Gas drops in pressure and goes dead. See UK North Sea gas.[1] 10 years from
peak to bottom.

[1] [http://www.crystolenergy.com/wp-
content/uploads/2016/03/Norw...](http://www.crystolenergy.com/wp-
content/uploads/2016/03/Norway-and-UK-Natural-Gas-Production.jpg)

~~~
tynpeddler
I'd like to think that's a feature not a bug. The solar electric revolution
finally looks like it's right around the corner, but it's not here yet. LNG
has shown up just in time to server as a bridge to solar, allowing the US to
lower its carbon emissions while critical solar technologies are still being
implemented. It's important though that we move past LNG as solar takes off.
The depletion of wells will hopefully increase hydrocarbon costs just in time
for them to be outcompeted by solar.

~~~
losteric
Does LNG have a lower carbon footprint that other fossil fuel energy sources?

~~~
philipkglass
Yes. Median emissions intensity for electricity from combined-cycle natural
gas plants, reported by the IPCC as of 2014, is 490 grams of CO2-equivalent
per kilowatt hour. That compares with coal at 820 g/kWh and cofired
coal/biomass at 740 g/kWh.

[https://en.wikipedia.org/wiki/Life-cycle_greenhouse-
gas_emis...](https://en.wikipedia.org/wiki/Life-cycle_greenhouse-
gas_emissions_of_energy_sources#2014_IPCC.2C_Global_warming_potential_of_selected_electricity_sources)

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adventured
It's one of the only ways the US can meaningfully trim its trade deficit.
China will absorb almost as much as can be shipped to them. The US should be
exporting $100-$200 billion in natural gas annually as soon as possible.

US oil exports are relatively booming now as well, recently hitting near a
record two million barrels per day:

[https://www.cnbc.com/2017/10/05/us-oil-exports-will-keep-
boo...](https://www.cnbc.com/2017/10/05/us-oil-exports-will-keep-booming-
after-hitting-record-analysts-say.html)

[https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=M...](https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCREXUS2&f=M)

~~~
jbob2000
Russia is also a huge natural gas producer, this could be an attempt to
destabilize them by flooding the market with one of their big exports.

~~~
adventured
At a minimum there's definitely demand side diversification, in terms of
Europe especially not wanting to not be wholly dependent on Russia.

The latest US natural gas boom only began in 2007 and more particularly in
2009-2010. Cheniere Energy's Sabine terminal is what made the new export boom
possible (more will come online soon). Prior to them switching that from an
import terminal to an export terminal, the US had no practical large-scale
export capacity.

All this is, is market demand, combined with the US being flooded with natural
gas that finally has an export release (with global natural gas prices
typically quite higher than the US). I don't see any hints of a master plan to
destabilize Russia with LNG exports (besides that it's very unlikely to dent
them, if that were the plan the Sabine terminal wouldn't have taken so long).
Qatar is the nation that is under most threat from US LNG entering the market
and altering the pricing/bidding structure, they've made a vast national
fortune off of that not existing (eg China can now use the US LNG supply
threat to bludgeon Qatar and others on pricing).

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mamon
This is just a wishful thinking. I live in a country that would benefit a lot
from alternative sources of gas, but for now LNG from US is just not price
competitive with the gas from Russian pipelines (as in: being 50-75% more
expensive). Funny thing is, that during his visit, president Trump announced
that he plans to increase LNG price further.

~~~
adventured
US LNG is about 20% more expensive than the typical European gas price. With
US domestic prices closer to $3, versus $5 in Europe, the US will be able to
further narrow that gap with scale and more terminals (on both sides of the
transaction). Then you factor in the willingness of Europeans to pay a small
mark-up to not be so dependent on Russian energy supply.

(from August)

"Currently, the US gas price is about $2.85 per MMBTU, a measure of energy
content in fuel. This rises above $6 after factoring all the associated fees
for shipping, liquefication and gasification, according to Gazprom estimates.
This compares with about $5 per MMBTU in much of the European market, where
Gazprom accounts for about a third of supply."

[https://www.ft.com/content/352f4cac-6c7a-11e7-b9c7-15af748b6...](https://www.ft.com/content/352f4cac-6c7a-11e7-b9c7-15af748b60d0)

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notfromhere
Transport via boat is just not going to beat direct pipe access from siberia

~~~
adventured
No doubt. Fortunately it doesn't have to. The US doesn't need to beat Russia's
lowest pipeline price, it needs to get near the European average price.

Russia needs to yield a fat profit on their exports, which is one reason why
Europe's gas prices are so much higher than the US domestic prices to begin
with. The financing of their government and their economy in general are both
heavily dependent on that. Russia isn't going to be willing to drop prices
much, while the US exporters will look at every possible means to drive down
their costs and pricing (they can afford a much slimmer margin than Russia can
on its exports).

Russia has 1/3 the natural gas market in Europe. It's unlikely they're going
to grow that market position (which is why they're looking east for growth),
their customers do not want to be more reliant on them. As Europe shuts down
coal, it's going to be replaced by natural gas and renewables; most of that
natural gas will be from sources other than Russia (meaning: Qatar, Australia,
US, etc).

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theyregreat
Using even more fossil fuels is a nonstarter because CO2 levels aren’t
leveling off, much less going down. Only consistent, severe international
economic incentives and disincentives can motivate rapid deployment of
renewables to hold-out / recalcitrant countries, of which there are many, at
present. It’s absolutely vital for the species’ survival. To do otherwise is
stupidity, insanity or both.

~~~
irrational
Fortunately the quickest way to get people to agree with you is to call them
stupid and insane. You should become our spokesperson.

~~~
fhood
Wait I thought the quickest way to get people to agree with you was to blame
immigrants?

~~~
KekDemaga
I never thought about it before but wouldn't bringing more people into the
first world increase global carbon output?

~~~
xbmcuser
It will and that has been my point. That the majority of the world population
does not live in the western world and uses 1/100 if electricity per person
once they start using more the world is ______

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knz
IIRC this was a huge talking point during the 2008 election cycle via
[https://en.wikipedia.org/wiki/Pickens_Plan](https://en.wikipedia.org/wiki/Pickens_Plan)
(the section on "Peak Gas" is particularly relevant).

I'm surprised that the article doesn't even mention this.

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raarts
The reason for the diminishing gas production in the Netherlands (briefly
mentioned in the article), is that the government every year shrinks the
allowed production maximum, due to the damage done by an increasing number of
earthquakes.

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mrfusion
I’d be interested in the physics of turning it into a liquid and maintaining
it.

Does anyone want to give us a lesson?

~~~
ISL
Take it to high-enough pressure while keeping it at room temperature, and it
will liquify.

~~~
philipkglass
Pressure alone is sufficient only when the substance is below its critical
temperature. The critical temperature for methane is 190.6 K, some 107 degrees
below room temperature. Gases that are highly compressed above their critical
point form a supercritical fluid, which can have liquid-like density but does
not have a defined volume.

LNG is a true liquid, stored at cryogenic temperatures and low pressure.

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desireco42
I am not expert in oil and gas markets, but some things in this article
doesn't make sense.

That Mexico benefited greatly, ecologically from US exports is great.

That US exports will diminish the demand for Russian gas and oil, in EU
especially and in China/India is ridiculous. Size of how much they are
supplying and infrastructure is just several times larger and it isn't likely
that US can make a dent. What they are using this as PR push, to make it seem
like EU can replace Russian imports with US.

I am not sure this is the future of energy, and I see this as a propaganda
push more then anything else.

~~~
woodandsteel
Two reasons the story makes sense

1) Russian prices are much higher than production costs because the Russian
government gets half its income from petroleum sales.

2) European countries are willing to pay a premium for US gas because they
hate how Russia uses European dependency on Russian gas as a political weapon.

By the way, you wouldn't happen to be a big Putin fan, would you?

~~~
desireco42
I must be since I don't see EU countries paying 1.5-2x for gas due to
ideological reasons.

Prices has nothing to do with capacity, amount that pipelines provide is
vastly higher than what can be brought by tankers. By the time EU build ports
and tankers, other energy sources will be mainstream and this will not be
relevant.

Again, in my view, pure propaganda move.

~~~
woodandsteel
>I must be since I don't see EU countries paying 1.5-2x for gas due to
ideological reasons.

No, as the article says, the prices are only 20% higher.

And again I ask you, are you a big Putin fan?

