Failure of US bid to flood Europe with Gas from Fracking


 by TheFreeOnline      A few months ago US officials were openly boasting that they would steal the market for Russian gas in Europe by replacing it with their own LNG now flowing from the devastated fracking fields of America.
But in recent weeks not a single cargo of Frack Gas has reached Europe..What went wrong?
It seems that with so much anti Russian hysteria  they overlooked the price difference. . Gas shipped from the first US LNG export terminal was at one point priced in Rotterdam at $7.85 to $8.35  per mbtu  while the average Euro price was $ 5.35, (May 2017 European price, see Climate-lethal US frack-gas Footnote 3) .Even the rabidly anti Russian Baltic Republics seem to have shut up about bashing Putin with US gas, while Rotterdam has signed up as the trans-shipment center for cheap LNG from the new Russian LNG plant in the Arctic.

Frack-Gas is the same as normal gas, only that it’s up to 3 times more lethal than coal for the climate. Because extracting it requires fracturing shale in thousands of small wells with ultra toxic chemicals causing massive methane leaking.

Two of the biggest customers at present of  US fracking gas , Shell and Gas Natural, who have 20 year ‘take or pay’ contracts, have been shipping most of  their gas instead through the Panama canal to the Far East, where prices until now have been up to $3  per mbtu higher.

US fracking gas and oil depends on almost cost free loans and near immunity from water and air pollution laws and clean-up costs as well as a blind climate change denial policy.
The business, which has made the US nearly selfsufficient  in ‘natural’ gas, LPG and oil for now,  is often seen as a patriotic push to conserve US supremacy as the petrodollar scam wobbles  and the right to ‘infinite debt’ comes into question.Ironically the first giant LNG export plant in Sabine Pass, Louisiana, was first hit a glancing blow by the classic ‘climate change hurricane’ Harvey. . Though the company Cheniere claimed there was no damage there was still a queue of LNG tankers waiting to load at the port a month later and LNG journals were rejoicing that things were ‘getting back to normal’.  (see Recovery Continues as Sabine Pass)

Cheniere forced to close two Sabine Pass LNG tanks following dangerous  leak

Then there is the ongoing leaking tank disaster. The 6 mega plant ‘trains’ at Sabine Pass have been built in record time. Too fast it seems because last week the company was ordered to close down two of the five immense tanks where the gas is compressed by 600 times and held at minus 150 C until loaded onto the tankers.

The inner wall of one tank had leaked and caused cracks in the outer wall designed only to resist minus 25C temperatures. When the controllers investigated they found out that another of the 5 tanks had earlier leaked and been secretly patched up.If the frozen compressed gas entered water ( the sea is adjacent) it could ‘probably explode and burn back to the tank’, causing all 5 tanks to explode in a ball of fire much bigger than Hiroshima, and  likely annihilating the town of Port Arthur nearby.  see  LNG Properties and Hazards. Understand LNG Rapid Phase Transitions (RPT)s

The company claims there is no problem, but the number of tankers loaded has fallen to a minimum since the tanks were closed down, and logically all 5 tanks should be closed if the same construction methods were used.

Climate Chaos Strikes the Empire back
Water supply shortage hampers Sabine Pass LNG production

In another surreal development climate chaos again struck back at the USA’s flagship  Frack Gas LNG Export plant in Sabine Pass. On 28th Jan 18 it was reported that temperatures on the Texas border had fallen to minus 6 C,  freezing and bursting pipes in Port Arthur town and severely curtailing LNG production in neighbouring Sabine due to lack of water. Reports claimed that temperatures in the North Pole were up to 30C above average while snow was reaching Florida. (see Water supply shortage hampers Sabine Pass LNG production )

Then there is the catch-22 price dilemma.  Due to a glut of US fracked gas it is at present dirt cheap (Henry Hub index) before expensive conversion to LNG and transport . But as LNG plants as well as pipelines to Mexico come on stream the price could shoot up and likely make exports unprofitable.

Another risk is cited in the inevitability of a fall in the extremely over valued financial markets, which might make the billions of dollars loaned to set up the facilities unpayable.

And finally there is the competition. The next LNG frack gas export facility at Cove Point, though relatively small scale, (a third the size of Sabine) is now in production and due to start exports in April 2018 .. and it is one of a dozen or more in development.  see Cove Point LNG starts production

”USA: Cheniere ordered to close two Sabine Pass LNG tanks following leak  ..  shared with thanks

Federal safety regulators have instructed US LNG export player Cheniere Energy to remove from service two of five liquefied natural gas storage tanks at its Sabine Pass terminal following a gas leak last month.

Tank S-103 at the Sabine Pass plant in Louisiana released LNG on January 22 into the space between the inner and outer tank walls, which eventually caused cracks in the outer tank wall and the pooling of LNG in the secondary containment area surrounding the tank, according to an order by the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration.

Exposure of LNG to the carbon steel outer tank resulted in the cooling of the outer tank wall to a temperature far below its design temperature of-25° F and the formation of four separately-identifiable cracks. These cracks propagated to a length of approximately one to six feet in length in a short amount of time, the order dated February 8 said.After launching an investigation into the release, the PHMSA learned that Tank S102 had also previously experienced releases of LNG.“ This raises the possibility that the conditions which resulted in the incident may be present in multiple tanks,” PHMSA said.

LNG World News invited Cheniere for a comment regarding the incident. “Safety is Cheniere’s number one priority, and we want to stress that there was and is no immediate danger to our community, workforce, or our facility from this incident, nor is there any impact on LNG production,” Cheniere spokesman Eben Burnham-Snyder said. “Cheniere has initiated an event investigation and is currently working with experts on a repair plan. We will continue to work with PHMSA to quickly address this incident,” he added.

The Federal Energy Regulatory Commission said in a notice on February 9 that Sabine Pass must receive written authorization before placing the two tanks back into service. “Such authorization will only be granted following a determination that the storage tanks are fit for service,” the notice said.

The five tanks at Sabine Pass have about 3.4 billion cubic feet equivalent capacity, each. Cheniere’s Sabine Pass facility is the first liquefaction and export facility and currently the only such facility to ship U.S. shale gas overseas. There are four 0.6-Bcfd liquefaction trains operating at Sabine Pass, and a fifth is under construction and expected to enter service in mid-2019. Cheniere also plans to start its Corpus Christi plant next year”

In the USA government backed companies have been exempted from environmental, water and methane regulations in a massive campaign to frack oil and gas, leaving a trail of destruction and poisoned aquifers and releasing a cloud of methane that may have cancelled out all efforts to limit climate change.

”US LNG exports drop for second week running  …LNG News

Houston-based liquefied natural gas export player, Cheniere, saw a decrease in the number of cargoes of LNG exported from its Sabine Pass facility in Louisiana over the past week.

Currently, the only such a facility to export US shale gas overseas, loaded three LNG carriers with a total carrying capacity of 11.5 Bcf, during the week ending February 21. This compares to five LNG carriers shipped in the previous week, the data from the U.S. Energy Information Administration shows.

One tanker with an LNG-carrying capacity of 3.5 Bcf was loading at the terminal on Wednesday. Natural gas pipeline deliveries to the Sabine Pass terminal were down over the report week, averaging 2.2 Bcf/d, 1 Bcf/d or 33 percent lower than in the previous week. No tankers departed from Sabine Pass for most of the report week, February 14 – February 19.

To remind, on February 8, U.S. Pipeline and Hazardous Materials Safety Administration (PHMSA) instructed Cheniere to remove from service two of five LNG storage tanks at its Sabine Pass terminal following a gas leak last month. Despite the decline in loadings and the tanks being out of service, Cheniere does not expect the removal of the storage tanks from service to affect the export levels.

LNG World News Staff

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Author: thefreeonline

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