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I attended a sparsely attended meeting regarding the possibility of drilling for NG in the Marcellus Shale region last night, sponsored by local Community Board 8 in Manhattan. The Marcellus Shale is home to 90% of New York City's drinking water. Although there were only about a dozen audience members, some of whom served on the community board, those who were there knew what they were talking about, and about the dangers of commercial fracturing to obtain Natural Gas (NG).
There comments are partially summed up by Manhattan Borough President Scott Stringer's white paper (dismissed as a "literature review" by the NY State Petroleum Council's Rep: Cathy Kenny) here:
click here />
Unfortunately, the NY State Petroleum Council does not have an online link to their counter-report, but basically they say the Stringer report "should not be regarded as scientific analysis, but rather a literature survey" and that the findings of the Stringer report, and of the sources such as Propublica:
click here />click here />
of contaminated water wells, exploding houses from NG buildup, cancer clusters and other health effects, should not be applied to the wells to be drilled in New York, because they will not use the same sorts of containment pits as the western states where there have been the biggest problems. The industry rep did not say what will be used in place of containment pits, however. It is hard to see why the New York projects differ from the rest of the country except in scale, and in that sense, the results should be only worse for the industry's position. Kenny cited the NY Dept. of Conservation's null findings on harm from "fraking" without mentioning that the DEC basically has never studied the issue (as confirmed by Propublica and audience attendees last night), so it is, for now, unqualified to comment. The DEC plan to remedy this later in the spring with a new report, but admit they are on a learning curve.
I think members of the Pickens Plan (like me) should be advised that there are currently several restrictive proposals in the works to limit or outright ban NG drilling in what is arguably the largest source of NG in the country. As a NYC resident, I can hardly be considered impartial, and it is clear that if our watershed becomes polluted by the industry's stew of 250+ - and proprietary list of - chemicals, it will be a long-term catastrophe for the region. NYC gets 90% of its water unfiltered, so constructing a multi-billion plant to begin filtering the water - even assuming the technical hurdles could be overcome - is essentially a non-solution.Despite my membership in the Pickens' Plan, I have to oppose NG drilling, at least anywhere near the 9% of area that constitutes the watershed. There are currently proposals to restrict drilling to 1-2 miles form the watershed, but with reports of chemical migration over 20 miles underground, even in smaller projects than proposed for New York, it's unclear, at best, whether this will be enough.
Also, as was pointed out in the meeting, this restriction should not mean that we should endorse fraking elsewhere in the state, just that the limited constituency of CB8 and the city does not represent the rest of the state and so cannot speak for them. Of course, the state DOES seem to feel entitled to speak for the city by allowing/disallowing drilling to commence.
Opposing drilling upstate is a difficult decision for me, since I do recognize that drilling would bring substantial revenues into a particularly depressed area of New York State, and that ending the half trillion a year import cost of oil will require some viable domestic alternative to imported oil. As a long-term member of the Pickens' Plan, I am well aware of the arguments to get off the petrostate teat.
But, wind (supported by the Pickens Plan too) and other renewables can provide for our base load power, while electric, hybrid electric/flywheel, electric/compressed air, or hydrogen fuel cells can answer our transportation needs as well as natural gas, without the CO2 contribution and the substantial local environmental damage. As even T. Boone Pickens recognizes, NG is a medium-term solution, until we can move on to something else. Perhaps the something else will not occur in his lifetime, or even some of ours, but we need to start preparing for it now, rather than add to our environmental messes.
http://newthinking.blogspot.com/
Thursday, April 30, 2009
Wednesday, April 29, 2009
Natural Gas Pricing Still Midwest Uncertain
HOUSTON
Petroleumworld.com, Apr. 28, 2009
Spot natural gas prices in the Upper Midwest fell in most areas Monday as the May NYMEX gas contract followed equity markets down on fears of a world-wide swine flu epidemic, and the possibility of major storms forecast for the Midcontinent reaching as far as Illinois.
Prices between Nicor Gas' city-gates and other Chicago city-gate points--Peoples Gas Light and Coke and Nipsco--remained far apart. Nicor, however, dropped nearly 10 cents after it announced that all delivery caps to its city-gates would be lifted on Tuesday.
It averaged in the mid-$3/MMBtu on IntercontinentalExchange. Peoples and Nipsco were more stable, gaining around a cent and losing a couple of cents, respectively, to hit a similar mid-point to Nicor.
Michigan city-gate prices dropped considerably more, with Michigan Consolidated Gas losing almost 15 cents to land in the mid-$3.40s/MMBtu. Consumers Energy, however, came off only half as much, coming in almost 10 cents above MichCon.
Cash in the production area dropped as well, with Northern Natural Gas' demarcation point prices weathering the drops the best, losing less than 5 cents for a mid-point in the mid-$2.80s/MMBtu.
Ventura, Iowa, prices fell around 10 cents, with Northern Border Pipeline-Ventura hovering around $3/MMBtu, and Northern Natural-Ventura more than 10 cents under that.
A tornado touched down in eastern Iowa over the weekend and more may reach there from storms in the Mississippi valley, according to forecasts.
Story by Joshua Starnes from Platts
- joshua_starnes@platts.com
Petroleumworld.com, Apr. 28, 2009
Spot natural gas prices in the Upper Midwest fell in most areas Monday as the May NYMEX gas contract followed equity markets down on fears of a world-wide swine flu epidemic, and the possibility of major storms forecast for the Midcontinent reaching as far as Illinois.
Prices between Nicor Gas' city-gates and other Chicago city-gate points--Peoples Gas Light and Coke and Nipsco--remained far apart. Nicor, however, dropped nearly 10 cents after it announced that all delivery caps to its city-gates would be lifted on Tuesday.
It averaged in the mid-$3/MMBtu on IntercontinentalExchange. Peoples and Nipsco were more stable, gaining around a cent and losing a couple of cents, respectively, to hit a similar mid-point to Nicor.
Michigan city-gate prices dropped considerably more, with Michigan Consolidated Gas losing almost 15 cents to land in the mid-$3.40s/MMBtu. Consumers Energy, however, came off only half as much, coming in almost 10 cents above MichCon.
Cash in the production area dropped as well, with Northern Natural Gas' demarcation point prices weathering the drops the best, losing less than 5 cents for a mid-point in the mid-$2.80s/MMBtu.
Ventura, Iowa, prices fell around 10 cents, with Northern Border Pipeline-Ventura hovering around $3/MMBtu, and Northern Natural-Ventura more than 10 cents under that.
A tornado touched down in eastern Iowa over the weekend and more may reach there from storms in the Mississippi valley, according to forecasts.
Story by Joshua Starnes from Platts
- joshua_starnes@platts.com
Tuesday, April 28, 2009
Natural Gas Sells in Brazil
RIO DE JANEIRO (Dow Jones)--Brazilian state-run energy giant Petrobras (PBR) successfully launched its first auction of natural gas, with 16 gas distributors participating, the company said late Friday.
Petrobras said it sold 3.59 million cubic meters of natural gas a day for May delivery, with the gas fetching an average price of $4.20 per British thermal unit, or BTU. In addition, Petrobras sold 3.24 million cubic meters of gas a day for June delivery at an average price of $4.25 per BTU.
Petrobras created the auctions as a way to sell excess gas in the company's pipeline system. The short-term contracts will allow the company greater flexibility to meet demand, the company said previously.
A combination of factors has crimped demand for natural gas in Brazil to start 2009, leaving Petrobras with excess supply.
Heavy rainfall earlier this year left reservoirs in Brazil's hydroelectric system at high levels, damping demand for electricity at gas-fired power plants. Slumping international oil prices also made fuel oil a cheaper alternative for local industry.
The slide in domestic natural gas consumption started just as Petrobras ramped up imports of liquefied natural gas and installed two regasification plants. The company has also curtailed imports of natural gas from neighboring Bolivia.
-By Jeff Fick, Dow Jones Newswires; 55-21-2586-6085; jeff.fick@dowjones.com
Petrobras said it sold 3.59 million cubic meters of natural gas a day for May delivery, with the gas fetching an average price of $4.20 per British thermal unit, or BTU. In addition, Petrobras sold 3.24 million cubic meters of gas a day for June delivery at an average price of $4.25 per BTU.
Petrobras created the auctions as a way to sell excess gas in the company's pipeline system. The short-term contracts will allow the company greater flexibility to meet demand, the company said previously.
A combination of factors has crimped demand for natural gas in Brazil to start 2009, leaving Petrobras with excess supply.
Heavy rainfall earlier this year left reservoirs in Brazil's hydroelectric system at high levels, damping demand for electricity at gas-fired power plants. Slumping international oil prices also made fuel oil a cheaper alternative for local industry.
The slide in domestic natural gas consumption started just as Petrobras ramped up imports of liquefied natural gas and installed two regasification plants. The company has also curtailed imports of natural gas from neighboring Bolivia.
-By Jeff Fick, Dow Jones Newswires; 55-21-2586-6085; jeff.fick@dowjones.com
Natural Gas Storage in Sacramento, CA
The state Public Utilities Commission will hold a public hearing in Sacramento on Tuesday about the proposed Sacramento Natural Gas Storage project.
The PUC will hold a meeting on the project’s draft environmental impact report, followed by a 7 p.m. hearing during which it will take public comments. Both events will be held in the Depot Park conference center at 8215 Ferguson Ave.
Sacramento Natural Gas Storage LLC, founded by Donald B. Russell, Jim Fossum and Derek Jones, plans to build and operate a facility that would store up to 7.5 billion cubic feet of natural gas underground in south Sacramento. It would hook up to a Sacramento Municipal Utility District pipeline to provide natural gas to fuel the Cosumnes Power Plant.
SMUD has signed a 20-year contract to store natural gas at the site. Sacramento Natural Gas Storage plans to sign up other customers if the project receives approval from the PUC and the city of Sacramento.
Last year the company raised $60 million for the project from group of investors led by Wells Fargo Energy Capital Inc., a non-bank subsidiary of Wells Fargo & Co.
The PUC will hold a meeting on the project’s draft environmental impact report, followed by a 7 p.m. hearing during which it will take public comments. Both events will be held in the Depot Park conference center at 8215 Ferguson Ave.
Sacramento Natural Gas Storage LLC, founded by Donald B. Russell, Jim Fossum and Derek Jones, plans to build and operate a facility that would store up to 7.5 billion cubic feet of natural gas underground in south Sacramento. It would hook up to a Sacramento Municipal Utility District pipeline to provide natural gas to fuel the Cosumnes Power Plant.
SMUD has signed a 20-year contract to store natural gas at the site. Sacramento Natural Gas Storage plans to sign up other customers if the project receives approval from the PUC and the city of Sacramento.
Last year the company raised $60 million for the project from group of investors led by Wells Fargo Energy Capital Inc., a non-bank subsidiary of Wells Fargo & Co.
Monday, April 27, 2009
Fiat Powered Natural Gas Cars
April 26, 2009, 1:46 am
An Alternate-Fuel Wild Card in Fiat’s Deck
By Nelson D. Schwartz
In Europe, Fiat is well-known for its mastery of diesel engines. In fact, one reason General Motors bought a 20 percent stake in Fiat’s auto division back in 2000 was to help expand the diesel offerings of its Opel unit. That partnership didn’t work out so well: G.M. paid Fiat $2 billion to extricate itself from the partnership four years later, although Opel did benefit from better diesel technology.
Now as Fiat negotiates with Washington, lenders and labor leaders on a deal to rescue Chrysler (a subject I covered in this article in Sunday’s Times), as well as acquiring Opel from G.M., another fuel that Fiat engineers have advanced could loom large: natural gas.
Fiat is the biggest player in the market for natural gas engines, which produce lower levels of greenhouse gases and other pollutants than either diesel or gasoline engines. In Italy this year the company hopes to sell 120,000 vehicles powered by natural gas, up from 68,000 in 2008.
Generous scrapping incentives from the Italian government will help — you get 3,000 euros if you trade in an old clunker for a new model powered by natural gas, double the allowance of 1,500 euros for junking a standard car. But over the long term, Fiat has a major opportunity to carve out a niche among motorists seeking power and performance while driving green, especially in markets like Germany and Britain, where Opel is strong, and possibly one day in the United States.
The challenge, of course, is fueling up. In Italy, Fiat is collaborating with fuel companies and the Italian government to provide more than a 1,000 stations where motorists can fill their tanks with natural gas. Many cars are equipped to operate on dual fuels, switching from natural gas to the diesel or gasoline tank as needed, depending on what is available.
Natural gas cars and commercial vehicles have been available in the United States for years, but the notion has never hit it big in the mass market, in large part because filling stations have been scarce by comparison. But that was then. An urge to reduce greenhouse gases — and the prospect of another spike in oil prices — could make Fiat’s engine technology very appealing to American drivers eager for an alternative to today’s hybrids.
An Alternate-Fuel Wild Card in Fiat’s Deck
By Nelson D. Schwartz
In Europe, Fiat is well-known for its mastery of diesel engines. In fact, one reason General Motors bought a 20 percent stake in Fiat’s auto division back in 2000 was to help expand the diesel offerings of its Opel unit. That partnership didn’t work out so well: G.M. paid Fiat $2 billion to extricate itself from the partnership four years later, although Opel did benefit from better diesel technology.
Now as Fiat negotiates with Washington, lenders and labor leaders on a deal to rescue Chrysler (a subject I covered in this article in Sunday’s Times), as well as acquiring Opel from G.M., another fuel that Fiat engineers have advanced could loom large: natural gas.
Fiat is the biggest player in the market for natural gas engines, which produce lower levels of greenhouse gases and other pollutants than either diesel or gasoline engines. In Italy this year the company hopes to sell 120,000 vehicles powered by natural gas, up from 68,000 in 2008.
Generous scrapping incentives from the Italian government will help — you get 3,000 euros if you trade in an old clunker for a new model powered by natural gas, double the allowance of 1,500 euros for junking a standard car. But over the long term, Fiat has a major opportunity to carve out a niche among motorists seeking power and performance while driving green, especially in markets like Germany and Britain, where Opel is strong, and possibly one day in the United States.
The challenge, of course, is fueling up. In Italy, Fiat is collaborating with fuel companies and the Italian government to provide more than a 1,000 stations where motorists can fill their tanks with natural gas. Many cars are equipped to operate on dual fuels, switching from natural gas to the diesel or gasoline tank as needed, depending on what is available.
Natural gas cars and commercial vehicles have been available in the United States for years, but the notion has never hit it big in the mass market, in large part because filling stations have been scarce by comparison. But that was then. An urge to reduce greenhouse gases — and the prospect of another spike in oil prices — could make Fiat’s engine technology very appealing to American drivers eager for an alternative to today’s hybrids.
Sunday, April 26, 2009
Natural Gas Summit for Europe
SOFIA (AFP) — Seeking to secure Europe's energy supplies, gas producer, consumer and transit countries Saturday urged greater cooperation and diversification of gas sources, at the end of a two-day summit in Sofia.
The leaders from 28 European, Caspian and Central Asian countries failed however to iron out difficulties over the supply of two major new pipeline projects -- the EU's Nabucco and the Russia-backed South Stream.
In a common declaration, they called for the "rapid development of international gas infrastructure, pipelines, liquefied natural gas terminals and strategic storages to guarantee diversification of gas supplies to Europe in a sustainable and viable way."
To achieve this, "a working and lasting bond of co-operation between producer, transit and consumer countries" had to be developed, they added.
But officials recognised on the sidelines that clashing opinions were far from being reconciled.
The summit followed a Russia-Ukraine price row in January that cut off gas supplies across Europe.
Noting that Europe's demand for imported natural gas would increase over the next 20 years, the summit steered away from specifically endorsing the two projects already under way.
But the rival EU-backed Nabucco and Moscow-backed South Stream pipelines nevertheless took centre stage in all discussions at the summit.
The 3,300-kilometre (2,000 mile) Nabucco pipeline aims to wean Europe off its dependence on Russian supplies by channeling natural gas from the Caspian region and Central Asia via Turkey and Austria to Western Europe.
The six Nabucco countries -- Austria, Hungary, Romania, Bulgaria, Turkey and Germany -- are expected to sign an intergovernmental agreement on the project by June, officials said Friday.
The rival South Stream project of Russian gas giant Gazprom and Italy's Eni is meanwhile seen as strengthening Russia's grip on Europe, allowing Moscow to bypass contentious Ukraine and pump gas directly to Europe via an alternative route under the Black Sea.
But while most Balkan states at the summit supported both projects in an attempt to diversify their supplies and pocket hefty transit fees, analyst Jacques Percebois of France's Montpellier University said "the current context of scanty cash" made it highly improbable to have both.
The summit had noted that huge amounts of funding would have to be poured into new pipelines to serve Europe's soaring demand.
Moreover, with both projects relying on gas supplies from the Caspian region and the Middle East, competition has grown fierce between producers as Brussels and Moscow also intensified efforts to woo potential suppliers to their side.
"There will not be enough gas to feed both pipelines," Colette Lewiner, another analyst from French agency Capgemini added.
"They talk about Iranian gas for Nabucco but this is highly unlikely to happen," she added, noting the current political situation in Iran.
However, Richard Morningstar, US special envoy for Eurasian energy, the first official in President Barack Obama's administration to confirm Washington's backing for Nabucco, said that he did not exclude Iran from the list of potential suppliers for the project.
"Obviously right now gas from Iran creates some difficulties with the United States as well as with other countries," he told journalists Saturday.
"We reached out to Iran, we want to engage with Iran, but it also takes two to go to the dance and we're hoping there will be positive responses from Iran," he added.
Lewiner also said that the EU project -- which Nabucco opponents call "an empty pipe" -- "lacks clear agreements with its potential suppliers of gas."
Russia's Energy Minister Sergei Shmatko assured Friday that Russia could find the gas to feed South Stream and also offer better gas prices than Nabucco.
But he failed to ease the United States' concern on the Moscow-back project.
"We have doubts about South Stream.... We do have serious questions," Morningstar said.
Analysts meanwhile added that apart from political wrangling, lack of clear financial commitments to the costly and technically complex projects also severely stalled progress on both South Stream and Nabucco.
And this would most probably push their opening beyond the 2014 deadlines, they said.
Copyright © 2009 AFP. All rights reserved
The leaders from 28 European, Caspian and Central Asian countries failed however to iron out difficulties over the supply of two major new pipeline projects -- the EU's Nabucco and the Russia-backed South Stream.
In a common declaration, they called for the "rapid development of international gas infrastructure, pipelines, liquefied natural gas terminals and strategic storages to guarantee diversification of gas supplies to Europe in a sustainable and viable way."
To achieve this, "a working and lasting bond of co-operation between producer, transit and consumer countries" had to be developed, they added.
But officials recognised on the sidelines that clashing opinions were far from being reconciled.
The summit followed a Russia-Ukraine price row in January that cut off gas supplies across Europe.
Noting that Europe's demand for imported natural gas would increase over the next 20 years, the summit steered away from specifically endorsing the two projects already under way.
But the rival EU-backed Nabucco and Moscow-backed South Stream pipelines nevertheless took centre stage in all discussions at the summit.
The 3,300-kilometre (2,000 mile) Nabucco pipeline aims to wean Europe off its dependence on Russian supplies by channeling natural gas from the Caspian region and Central Asia via Turkey and Austria to Western Europe.
The six Nabucco countries -- Austria, Hungary, Romania, Bulgaria, Turkey and Germany -- are expected to sign an intergovernmental agreement on the project by June, officials said Friday.
The rival South Stream project of Russian gas giant Gazprom and Italy's Eni is meanwhile seen as strengthening Russia's grip on Europe, allowing Moscow to bypass contentious Ukraine and pump gas directly to Europe via an alternative route under the Black Sea.
But while most Balkan states at the summit supported both projects in an attempt to diversify their supplies and pocket hefty transit fees, analyst Jacques Percebois of France's Montpellier University said "the current context of scanty cash" made it highly improbable to have both.
The summit had noted that huge amounts of funding would have to be poured into new pipelines to serve Europe's soaring demand.
Moreover, with both projects relying on gas supplies from the Caspian region and the Middle East, competition has grown fierce between producers as Brussels and Moscow also intensified efforts to woo potential suppliers to their side.
"There will not be enough gas to feed both pipelines," Colette Lewiner, another analyst from French agency Capgemini added.
"They talk about Iranian gas for Nabucco but this is highly unlikely to happen," she added, noting the current political situation in Iran.
However, Richard Morningstar, US special envoy for Eurasian energy, the first official in President Barack Obama's administration to confirm Washington's backing for Nabucco, said that he did not exclude Iran from the list of potential suppliers for the project.
"Obviously right now gas from Iran creates some difficulties with the United States as well as with other countries," he told journalists Saturday.
"We reached out to Iran, we want to engage with Iran, but it also takes two to go to the dance and we're hoping there will be positive responses from Iran," he added.
Lewiner also said that the EU project -- which Nabucco opponents call "an empty pipe" -- "lacks clear agreements with its potential suppliers of gas."
Russia's Energy Minister Sergei Shmatko assured Friday that Russia could find the gas to feed South Stream and also offer better gas prices than Nabucco.
But he failed to ease the United States' concern on the Moscow-back project.
"We have doubts about South Stream.... We do have serious questions," Morningstar said.
Analysts meanwhile added that apart from political wrangling, lack of clear financial commitments to the costly and technically complex projects also severely stalled progress on both South Stream and Nabucco.
And this would most probably push their opening beyond the 2014 deadlines, they said.
Copyright © 2009 AFP. All rights reserved
Saturday, April 25, 2009
El Paso Natural Gas Pipeline
NEW YORK, April 24 (Reuters) - El Paso (EP.N) said Friday it lifted force majeure on its Southern Natural Gas unit after divers confirmed a leak in the area of its 18-inch West Delta 105 natural gas pipeline in the Gulf of Mexico was not on its system.
Personnel were in the process of restoring the pipeline, according to a website posting. About 42 million cubic feet per day of gas was shut in due to the investigation.
It was not immediately known what pipeline the reported leak was on.
An earlier website posting said several receipt points on Southern's system had been shut in.
The 7,600-mile (12,200-km) Southern Natural Gas pipeline is part of El Paso's 42,000-mile interstate pipeline system. (Reporting by Eileen Moustakis; Editing by Marguerita Choy)
Personnel were in the process of restoring the pipeline, according to a website posting. About 42 million cubic feet per day of gas was shut in due to the investigation.
It was not immediately known what pipeline the reported leak was on.
An earlier website posting said several receipt points on Southern's system had been shut in.
The 7,600-mile (12,200-km) Southern Natural Gas pipeline is part of El Paso's 42,000-mile interstate pipeline system. (Reporting by Eileen Moustakis; Editing by Marguerita Choy)
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