As up to seven new LNG ports and a number of carriers are completed this year it is expected that supplies will increase to the United States. The projects have been planned for so long, and cost so much that gas must flow and be sold. The Federal Energy Regulatory Commission has had to develop policies on LNG , but even they defer to the market. Given this potential for over-supply the Freeport LNG terminal is looking into the potential for re-export, and local storage, since peak demand and supply may not be in phase. On the other hand recognizing that the time might be ripe to gain access to a cheaper source of power, Japan’s Tokyo Gas is looking at installing a new LNG terminal. To ensure supplies they have agreed to extend buying contracts for LNG supplies from Alaska. The Japanese, who are the largest users of LNG, need to do this to replace supplies that have been lost due to export reductions from Indonesia. The Alaskan gas sells for roughly 4/7ths of what the Japanese would have to pay for gas from Qatar.
In the lower 48, gas producers from shale are moving to stabilize supplies to the network. A new “Tiger Pipeline” is planned to collect and deliver for Haynesville shale gas into the interstate network. A new well is going into the Haynesville, that will run 17,000 ft horizontally. The Marcellus shale is also seeing some investor interest. XTO expects that gas (natural) prices will head back up before the year is out.
Hopes for energy price increases are hitting the wind industry, just as it comes out of a year where the USA added 8.5 GW of wind power. Of the major states adding wind power, California has seen the smallest recent growth, and in part that is because all the “easy” sites have now been taken, and the costs of permitting are now beginning to bite in the sites that are now in development. As a result Iowa is now second in wind power in the nation and has six manufacturers. But it turns out that the claim that the wind industry had more employees than coal mining relied on skewed counting (they counted everyone in wind, but only the miners in coal mining. But older wind farms are refurbishing with larger turbines and this also helps economically.
There will be a new 500 MW farm in Iowa, if they can get enough land, but construction will start in 3-5 years. In Rhode Island they plan on starting an offshore plant in 2010, they have enough wind for utility size operations which is level 3 on land (out of 7 with 1 being poorest), but have higher levels offshore, which is where the farm will go. In inland Northwest Missouri they now have a town (albeit only 1300 people) that receives all their power from the 4 nearby wind turbines.
The disruption caused by Total giving a contract to an outside, rather than domestic company in the UK may spread to other refineries and include nuclear power plants.
High temperatures in Australia, and particularly Melbourne played some considerable havoc with the Australian Open . Even as that ended, rolling blackouts are anticipated today because of the closure of the power link from Tasmania (due to overheating) . About 20,000 homes in the state (Victoria) are without power and the rise in the demand for energy has reached the limits of what can be provided. Bush fires are also threatening power lines, and a local coal company operation , while the drought is draining local water supplies . Locals are also concerned because of the secrecy of the order of priorities for load shedding.
It is not only in California and Australia that water supply is a problem. In the Central Asian republics Russia is stepping in to sort out possible conflicts since the countries from which the main water supply comes (Tajikistan and Kyrgyzstan( want to develop hydropower, while those downstream (Uzbekistan, Kazakhstan, and Turkmenistan) want the water for agriculture. The Tajiks are willing to offer the Uzbeks water for energy. Turkmenistan is also involved since they send out electric power that must pass through other countries to the end user.
Uzbekistan is demanding 10 per cent of the $0.03 per kilowatt paid by Tajikistan to Turkmenistan.And the Tajiks are not taking kindly to the Russian intervention.
This year the Uzbeks are also charging Kyrgyzstan and Tajikistan US$ 240 per 1000 m3, up from 145 dollars last year.
For more stories go to The Energy Bulletin or Drumbeat at The Oil Drum