First Arctic Navigation in February


Alexander Ryumin/TASS

A tanker sailed through Arctic sea ice in February for the first time, the latest sign of how quickly the pace of climate change is accelerating in the Earth’s northernmost regions.

The Christophe de Margerie was accompanied by the nuclear-powered 50 Let Pobedy icebreaker as it sailed back to Russia this month after carrying liquified natural gas to China through the Northern Sea Route in January. Both trips broke navigation records…

The experimental voyage happened after a year of extraordinarily warm conditions in the Arctic that have sent shockwaves across the world, from the snowstorm that blanketed Spain in January to the blast of cold air that swept through Canada in mid-February, moving deep into the South as far as Texas.

If the Bloomberg link is acting up, try accessing through Flipboard to Bloomberg.

USDOE tells Freeport LNG not to sell to Chinese customers – Free Trade, eh?

The U.S. Energy Department cautioned Freeport LNG Development LP against signing up Chinese customers for the company’s planned liquefied natural gas export terminal in Texas, Chief Executive Officer Michael Smith said.

“Early on in our project, we were quite frankly warned by the Department of Energy that it would not be looked at as politically correct for us to have a large Chinese customer,” Smith said…at the FT Energy Strategies Summit in New York. “One of the largest Chinese customers wanted a full train,” or processing plant, he said.

In return for signing LNG purchase agreements, Chinese buyers demand equity stakes, which they say are required by their lenders, Smith said. Aside from Cheniere Energy Inc.’s Sabine Pass terminal, which has an investment from a Hong Kong-based company, no U.S. export projects have disclosed Chinese customers…That contrasts with Canada, where Chinese investors are key backers of export projects.

A glut of natural gas production from shale reservoirs has spurred dozens of projects to export LNG. The U.S. may become a net exporter of gas by 2017, government data show. In China, the third-largest market for LNG, demand for gas as a cleaner alternative to coal and oil for power generation is rising…

The Energy Department has given final authorization to six projects, including Freeport’s, to export LNG to countries lacking a free trade agreement with the U.S…The only countries that can’t receive exports are those prohibited by U.S. law or policy, Lindsey Geisler said by e-mail.

If the department did advise Freeport not to seek Chinese customers, “the comment made by DOE was, in my judgment, ill-advised and probably made in the expectation of not being cited publicly, but perhaps to gently dissuade Mr. Smith from entertaining a Chinese terminal user,” Zach Allen, president of Pan Eurasian Enterprises, a…tracker of LNG shipments said.

Canadian LNG projects have attracted Chinese investors, who have bought gas supplies in the field and taken stakes in potential pipelines and shipping terminals. Royal Dutch Shell Plc’s project along the Pacific Coast counts China’s state-owned PetroChina Co. as an investor. CNOOC Ltd., another Chinese state-owned company, has a less advanced Canadian LNG proposal with Inpex Corp. and JGC Corp., both of Japan.

If you’re concerned about how Free Trade operates under the United States government, you can look at this tale as a classic example of our government as liars. Time after time, we get statements from the White House and Congress about China and other Asian nations – but, mostly China – needing to step up and spend their money in the United States. From Huawei to CNOOC, our government then steps in and tries to shut down business.

There is little or no difference between Conservative liars on committees controlled by Congressional Republicans and Liberal liars on Pennsylvania Avenue.

Record-breaking barge, Prelude, floated in Korean waters

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A floating vessel that is longer than the Empire State Building is high has taken to the water for the first time.

The hull of Shell’s Prelude was floated in South Korea.

When fully built, Prelude will be the largest floating facility ever created, weighing more than 600,000 tonnes.

It would be used to help in the production of natural gas from 2017, Shell said, and would operate for 25 years off Australia’s north-west coast.

The area has a yearly cyclone season from November to April, but Prelude has been designed to withstand such conditions. It is hoped the facility will be able to produce enough gas to power a city the size of Hong Kong.

I do not miss working in shipyards. Even when you get to work on the construction of something this impressive, it’s still mostly grunt work, plumbing and welding. Oil field work that floats.

OTOH, the engineering requirements of a structure this massive impresses. Even if it wasn’t designed to float and survive severe weather it would be a beastie.

Nordic ferries go LNG gas-powered

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The Finnish flag is fiercely clacking at the stern as the Viking Grace carves through spring ice, past scores of small islands on the route between Stockholm in Sweden and Turku in Finland.

A maritime revolution is taking place in this narrow waterway and its archipelago of hundreds of small islands. The Viking Grace, a brand new cruise ferry, is fuelled entirely by liquefied natural gas (LNG) and is the first of a new generation of green passenger ships.

Down in the bowels of the ship, the engines are running on 100% gas, although they are capable of using old-fashioned diesel as a back-up propellant if necessary.

“LNG is the cleanest of the fossil fuels we have on Earth,” says First Engineer Victor Gingsjoe…”Compared to running on diesel oils, the particle matter that we release into the atmosphere is virtually nothing. The sulphur oxide emissions are practically nothing. And also we can reduce the CO2 [carbon dioxide] by up to 30%…”

By using LNG, the vessel is complying with new emission controls that come into effect in the Baltic Sea in 2015. Similar rules will begin simultaneously in the North Sea and along the east and west coasts of North America.

It is hoped the changes will make a significant difference to the ecology of the Baltic Sea, which is heavily polluted, in part from Russian ships coming from the east…

The project’s supporters say the new regulations will not just benefit nature, but also public health.

“In Europe, we know that about 50,000 premature deaths are caused from air pollution from shipping,” says Dr Presse-Kristensen…”And the cost to society is about 55 billion euros every year, so it’s a huge cost.”

An operating business/government structure that thinks beyond the next quarter or the next election is such a rarity here in the United States – I imagine this would be as difficult for our patent leather political hacks to get their heads round as the science and ethics behind the decisions resulting in transportation like this.

Unreported economy story: CNG could solve US foreign oil dependence within 2-3 years


Filling up a CNG-powered RAM pickup truck

Fiat and Chrysler CEO Sergio Marchionne said during the weekend before last at an industry convention in China that it is “most shocking” that the United States auto industry is not throwing its might behind natural gas, which has been found in abundance in its home country.

“A rapid adoption of CNG as a fuel source for automotive applications would almost instantly kill the reliance on foreign oil, and it would bring about a substantial reduction in emissions,” said Marchionne. “Those are opportunities that need to be grabbed and they need to be industrialized. Especially with large vehicles like pickups and large SUVs, we could probably accommodate the installation of CNG tanks within the next 24 to 36 months…”

But though Marchionne’s newsworthy views were offered on the sidelines of the convention in Shanghai, his talk about the paradigm-shifting potential of CNG was not reported. Instead reporters chased down answers to politicized questions as to whether Jeep production would be outsourced to China.

Concerns by reporters focused on whether production priorities would cost jobs in the U.S., or Italy. Both of which Marchionne answered for the umpteenth time with a “no.”

Poor reporting by unscrupulous bloggers has been partially blamed for the rumor that Jeep production would be outsourced from Toledo, Ohio, to China. Actually an original story on Oct. 22 by Bloomberg had the facts straight, but others overstated the purported sell-out to the Chinese story to the point that even Mitt Romney got it wrong…

Romney knew better. He’s just a liar.

But while reporters were chasing the seeds of that false Jeep-to-China report with Marchionne in Shanghai, they missed a true story on his considered views on how to cure U.S. dependence on foreign oil and to curb global warming.

And while he is at it, Marchionne says he doesn’t think ethanol has much future in the U.S. He said alcohol works as a fuel for Brazil where, “from a global standpoint, producing ethanol probably is the most efficient use of their sugarcane.” It was tried in Africa, and it failed. And, said Marchionne, he is “making no comments on the U.S. side of ethanol production which relies on grains.” We take it, Sergio doesn’t think it’s a good idea.

With little local infrastructure or broadcast access to CNG here in Santa Fe, the folks I know with cars running on natural gas have been paying the equivalent of $1.61 per gallon. Nationwide, still less than $2/gallon. That’s enough to get me thinking seriously about our next family vehicle being a factory conversion to natural gas – or something we might do after market.

The reasons are the same for our perpetual consideration of an electric car – or plug-in hybrid like the Chevy Volt or Ford’s C-Max. 99.9% of our driving is my wife’s work commute and our weekly grocery run plus the usual errands about town. An EV is still too high for us to consider the initial purchase – even though we’re the kind of family that keeps a motor vehicle 12-20 years. The payback is reasonable. The upfront cost is intimidating.

Northern New Mexico is an ideal location for CNG to be added to filling stations. Cripes. We’re a natural gas exporting state. The only handicaps are the usual: politicians stuck in the past, small business owners who can’t or won’t risk the investment. Both of which would be resolved by Feds willing to risk the sort of loans they make to the most undeserving segment of our economy – Big Oil and Big Coal.

US natural gas to be exported globally from Louisiana in $8B deal

BG Group Plc will buy 3.5 million metric tons a year of liquefied natural gas from Cheniere Energy Partner LP’s terminal at Sabine Pass in Louisiana, bringing U.S. exports a step closer.

The 20-year contract is Cheniere’s first long-term sales agreement for exports from the terminal’s proposed plant in Cameron Parish and may help the company raise finance to begin construction of the facilities that will chill the gas, turning it into liquid for transportation, BG Group said in a statement…

Surging shale gas production has reversed declining output in the U.S., now the world’s largest gas producer ahead of Russia. Companies including Cheniere plan to convert LNG import terminals into export plants.

…Profitability of U.S. exports is determined by the price difference between gas and crude oil. Oil is sometimes used as a power generation fuel, and is also used as a reference in setting Asian long-term energy contract prices…

Shipments may start as soon as 2018, Elizabeth Spomer, senior vice president for business development, said.

Cheniere has said it plans to sell LNG to Caribbean nations for power generation to cut their dependence on crude oil. Jamaica, Puerto Rico and the Dominican Republic are among those that could save money by burning gas to generate electricity, Cheniere’s chief executive officer Charif Souki has said.

And, someday – just maybe someday – the political blockheads in Washington will realize that both American consumers and American investors would benefit from including natural gas as a leading producer of electricity in this land of ours.

I ain’t holding my breath waiting, though.