Saturday, May 21, 2011

Energy Independence Is Nothing But A Scam

Cheniere Surges After U.S. Expands Its LNG Export Approval
Cheniere Energy Inc. (LNG), the Blackstone Group LP-backed owner of a U.S. liquefied natural-gas terminal, surged 31 percent after it won government approval to export the fuel to more countries.
Cheniere, based in Houston, rose $2.35 to $10.04 at 4:15 p.m. in New York Stock Exchange composite trading. The shares touched a 52-week high of $11.11, the biggest intraday gain since November 2008. Before today, the shares had gained 39 percent this year.
The Energy Department will allow Cheniere’s Sabine Pass terminal in Louisiana to export as much as 803 billion cubic feet a year of U.S. gas, according to the company’s statement today. Cheniere still needs Federal Energy Regulatory Commission approval to build a $6.4 billion facility at the site that can liquefy gas for export by tankers.
Today’s decision expands on a September 2010 ruling that permitted Cheniere to ship gas to 15 countries with Free Trade Agreements, according to a statement from the Energy Department in Washington. The company, which lost money for 13 consecutive years and earlier this month warned it may have to sell assets and restructure debt to avoid running out of cash, has yet to say how it intends to finance the project.

‘Breakthrough’ Plan

“Cheniere Energy’s plan to transform its existing terminal into a facility that can both import and export liquefied natural gas is a precedent-setting breakthrough that will bring substantial economic benefits to southwest Louisiana,” Senator Mary Landrieu, a Louisiana Democrat, said in a statement distributed by the Energy Department.
A North American gas glut fed by new wells in previously impenetrable geologic formations has slashed prices for U.S. supplies to less than one-third the prices paid by utilities and chemical makers in nations such as Japan, according to data compiled by Bloomberg. Cheniere and other U.S. companies such as Apache Corp. (APA) see an opportunity to profit from that arbitrage.
Gas can be super-cooled to liquid form so it can be transported on tankers for distribution to markets too distant to be connected to gas fields via pipelines. Exxon Mobil Corp. (XOM), Royal Dutch Shell Plc (RDSA), Chevron Corp. (CVX) and other international energy companies are spending tens of billions of dollars on liquefaction plants to ship gas from Australia, Papua New Guinea and other sources to markets in Asia and Europe.

Japanese Premium

Japanese power companies and chemical producers were paying $14.15 per million British thermal units for Qatari LNG in March, the last month for which figures were available from Japan’s Customs Bureau. Prices at the U.S. benchmark hub in Erath, Louisiana, averaged $4.51 that same month.
Gas liquefied and exported from the Sabine Pass facility probably will originate in onshore formations in Texas, Louisiana, Oklahoma and Arkansas, Cheniere said in its application with the Energy Department.
Cheniere, whose stock traded above $44 in 2006, is among companies that built U.S. gas-import terminals during the past decade that then languished as new drilling techniques unlocked domestic supplies, pushing gas prices too low to justify costlier imports.
Cheniere’s cash and near-cash equivalents fell by $50 million during the first three months of this year, ending the quarter at $24.5 million, the Houston-based company said on May 6. Cheniere has a $298 million loan payment due in May 2012, according to data compiled by Bloomberg.
Cheniere owns the Sabine Pass terminal through its 91 percent stake in Cheniere Energy Partners LP (CQP), according to a May 6 filing.

1 comment:

  1. Energy Independence?

    No. Just more industry lies to con the American people into giving away their mineral rights and use of their land.

    And... now they expect PUC status so they can get 'right of condemnation via eminent domain' to lay gathering pipelines so they can connect to interstate transmission lines like CNYOG's MARC-1 Pipeline that will transport the gas that lies under under OUR properties to liquification plants in Maryland for overseas export?

    Under PA law, none of these companies, or their activities, meet the qualifications for a Public Utility as they are not 'necessary, or serve the public good'.

    And guys like Senator Scarnati want to pass legislation that will hold local municipalities hostage by refusing them revenue collected from pmact fees if they enact ordinances that might restrict gas drilling operations.

    The gas industry waived the flag of patriotism, said we'd become wealthy, told us this would lead to energy independence, and affordable energy, because if they told us the truth, most people would have sent the landman packing and not signed a lease. The same reason they lied about horizontal drilling and hydraulic fracturing being "100% safe". They knew we would not sign on if we knew the truth.

    The real truth is, the oil and gas industry want to turn rural US into third-world style gas and oil fields. They've been doing this overseas for decades using the same tactics. They install 'puppet governments', promise 'local jobs', polarize communities, spread some cash around to impress the skeptics, discourage regulation by promising to use 'best practices' (until their caught), deny any responsibility when something goes wrong (and it does way too often). Then, they try to discredit and villify any well informed opposition, ghost-write favorable legislation, retain the most powerful law firms in the state so they can't represent any citizens or communities that may be negatively impacted by their activities, and eventually drive people off their land by making it unlivable by depleting and/or contaminating it's natural resources.

    I'm not going to say that all of our state and local politicians knew the truth from the beginning, or not. I don't know. However, they do know it now, and they owe to the people who elected them to stand-up to this industry NOW!

    Contact your state representatives and state senators, ask them where they stand, and tell them NOT to support Scarnati's Senate Bill 1100, or you will no longer support them with your vote, and you will even campaign against them when they run for re-election, or any other public office. And, remember to check their voting records!

    Here's more links to more articles on exporting liquified natural gas:

    USA: Dominion Plans to Export LNG From Cove Point Terminal

    "The export plant would source gas from the prolific Marcellus shale gas field, which stretches across two thirds of Pennsylvania and parts of surrounding states."

    US approves first natural gas exports
    By Gregory Meyer in New York
    Published: May 20 2011 21:37 | Last updated: May 21 2011 00:13

    FACTBOX-North America natural gas export plans

    Firms Plan to Export Gas