Headlamp – Coal sees largest year-over-year tonnage increase since 2001. 

U.S. coal production, exports, and prices increased in 2017. EIA expects total 2017 U.S. coal production to be 773 million short tons (MMst), 45 MMst higher than in 2016 and the largest year-over-year tonnage increase since 2001. Coal prices across the United States rose as well, especially for Central Appalachian coal. An increase in demand for U.S. coal exports more than offset a slight decline in U.S. coal consumption, contributing to higher coal production in 2017.

Asia preferred destination for US LNG. Mexico, South Korea and China are the biggest buyers of liquefied natural gas (LNG) produced from US shale gas, according to the data from the Department of Energy. These three countries took almost half of the total LNG volumes that have been produced at Cheniere’s Sabine liquefaction plant in the period from February 2016 to December last year, the data shows. For the year of 2017, US LNG exports surged to 13.1 million tonnes from 3.1 million tons in 2016 as Train 3 and 4 started producing the chilled fuel at Sabine Pass. There are currently four 0.6-Bcfd liquefaction trains operating at Sabine Pass, and a fifth is under construction and expected to enter service in mid-2019. Last year also saw Asia becoming the preferred destination of US LNG. Asia Oceania absorbed the largest share or 43% percent of US LNG volumes in 2017 while nearby markets of South America and Mexico still accounted for 31% of US LNG deliveries, the international association for natural gas, Cedigaz said in a report.

Simplify rules, attract investment. The Indonesian government has scrapped dozens of regulations hampering investment flow into the energy sector as the government expects to boost investment in the sector. Indonesian Energy and Mineral Resources Ministry said on Monday that it has abandoned 22 out of 51 rules for business license in the sectors of oil and gas, mineral resources and electricity. “Hopefully this can help luring more investment in the sector by twice this year,” Indonesian Minister for Energy and Mineral Resources Ignasius Jonan told a news conference at the ministry. “The ministry has set a 51 billion dollar target of investment in the energy sector this year,” the minister said. Indonesia is the world’s largest exporter of thermal coal and home to the world’s second biggest copper mine. However, production of the country’s oil has been dwindling in recent years due to aging wells, thus the government is trying to attract more investment for exploration in an effort to raise outputs.

Triple Tax Credits for Carbon Injection. A little-noticed addition to the U.S. budget deal approved last week will help Occidental Petroleum Corp and other oil producers by more than tripling a tax credit for injecting carbon dioxide back into the earth to increase crude output. The tax-credit expansion, although supported by environmentalists and energy producers, had failed to move out of Congress during the 2016 presidential election. Its passage now likely will further boost already surging U.S. oil output in a year that production is forecast to hit 11 million barrels per day. The injection process, used for more than 40 years to prolong output from traditional oil wells, also is being tested by Oxy and others as a way to speed more oil production from shale wells.

First Reads:

U.S. coal production, exports, and prices increased in 2017
U.S. Energy Information Administration, Brian Park, February 16, 2018

Mexico, South Korea and China are the biggest buyers of US LNG
O&G Links, LNG World News Staff, February 14, 2018

Indonesia Simplifies Rules In Energy To Attract Investment
O&G Links, Daily Independent Nigeria, February 13, 2018

U.S. spending bill expands carbon tax credit, boosting oil producers
Reuters, Ernest Scheyder, February 16, 2018