China en route to being world’s largest LNG import market
Natural Gas News, February 21, 2019
China became the largest single gas importer in 2018 as demand again easily outstripped production. This raises two questions. How much more imported gas will it need in coming years, and how much will comprise LNG? The International Energy Agency’s World Energy Outlook 2018, published in November, projects a near-tripling in Chinese gas demand to 708bn m3 by 2040. Imports are projected to rise from 42% of gas supply in 2017 to 54% over this period. China’s voracious demand for LNG over the next decade is expected to underpin global investment in LNG production capacity.
US-China trade dispute puts a chill on American natural gas export boom
Tom DiChristopher, CNBC, February 22, 2019
- The global gas market experienced fewer disruptions than feared this winter after China slapped tariffs on U.S. liquefied natural gas.
- However, the ongoing trade dispute has halted Chinese purchases of U.S. LNG and put a chill on some new American export terminals. It threatens to sideline billions in investment.
- At least one U.S. LNG export terminal delayed a final investment decision, and analysts say the trade war could hold up other projects.
Canada’s Barrick Gold considers hostile $19 billion bid for Newmont Mining
Melanie Powers, Reuters, February 21, 2019
Canada’s Barrick Gold Corp is considering a hostile bid for Newmont Mining Corp for about $19 billion in stock, in what would potentially be one of the largest-ever mining deals, the country’s Globe and Mail newspaper reported.
Our Take: Barrick Gold is the biggest gold mining company in the world and the parent company for the Donlin project in Alaska.
90-day comment period for Pebble mine review is inadequate, Sullivan says
Becky Bohrer, Associated Press, February 21, 2019
U.S. Sen. Dan Sullivan said a 90-day comment period is inadequate for a draft environmental review of a large copper and gold mine near the headwaters of a major Alaska fishery. “It’s a very legitimate request from my perspective to have more time to do the due diligence on a project of this size,” the Republican Sullivan told reporters Thursday, noting he would likely make a formal request for additional time.
Feds advance Alaska’s Pebble gold and copper project with release of draft environmental review
Alex DeMarban, Anchorage Daily News, February 20, 2019
The Trump administration on Wednesday unveiled the first-ever draft environmental review of the controversial Pebble gold and copper project. The report is a key step in the regulatory process and will lead to a 90-day public comment period for the Southwest Alaska mine that has been in the works for more than a decade, the U.S. Army Corps said Wednesday.
Mineral import reliance US Achilles’ heel
Shane Lasley, North of 60 Mining News, February 15, 2019
U.S. Sen. Lisa Murkowski, R-Alaska, called on Congress to pass legislation that will curb the United States’ increasing dependence on foreign countries for its growing mineral needs. “Our nation is headed in the wrong direction on mineral imports. [It] is our Achilles’ heel that serves to empower and enrich nations, while costing us jobs and international competitiveness.” As Murkowski noted, minerals are fundamental to life as we know it and the building blocks of a robust economy. Yet, according to the U.S. Geological Survey, in 2017 the United States imported 50 percent of 50 mineral commodities, including 100 percent of 21 minerals.
America is losing battery metals arms race
Shane Lasley, North of 60 Mining News, February 15, 2019
The second article outlines how this reliance may impact the auto and energy storage industries in the United States, highlighting a message that Simon Moores, the managing director at Benchmark Mineral Intelligence, delivered to ENR members. “He [Moores] said the growing number of electric vehicles hitting the markets, coupled with an increasing demand for electric storage for other uses, is driving unprecedented growth for lithium-ion batteries and the four key materials that go into them – graphite, lithium, cobalt and nickel. The United States is currently heavily dependent on imports for all four of these materials and risks being left behind as traditional petro-fueled automobiles give way to a future dominated by battery powered electric vehicles… Those who control these critical raw materials and those who possess the manufacturing and processing know-how, will hold the balance of industrial power in the 21st century auto and energy storage industries.”
Draft study on Alaska LNG to be released at the end of the month
Hank Davis, KTUU, February 20, 2019
The Federal Energy Regulatory Commission is scheduled to release a draft version of the Alaska LNG pipeline project Environmental Impact Study at the end of this month. It’s been a decades-long process to get to this point, with the $43 billion, 800-mile long pipeline, which would transport natural gas across the state.
Shell leads big oil in clean energy shift
Amy Harder, Axios, February 19, 2019
Royal Dutch Shell, one of the most aggressive global oil and gas producers on clean-energy and climate change, faces big tests on how serious it is with its pursuit. The big picture: Shell, the world’s second-largest publicly traded oil company after ExxonMobil, has over the past year ramped up enough investments and commitments in this area to surpass any other producer similar in size. CEO Ben Van Beurden is far more forceful than most other oil executives about positioning his company to profit off a world drastically reducing greenhouse gas emissions as envisioned in the 2015 Paris Climate Agreement.
Getting the facts on the upstream carbon impact of ANWR development
Liam Zsolt, Peninsula Clarion, February 19, 2019
On Monday, Feb. 11, I had the privilege of watching democracy in action, right here in Anchorage. The draft Environmental Impact Statement (DEIS) for the Arctic National Wildlife Reserve (ANWR) was released, and public comments were taken at the Dena’ina Center in Anchorage. The Bureau of Land Management (BLM) furnished us with maps of the different development scenarios, impacts on the indigenous people and animal species, and a strong education on the process. Hats off to the agency for sitting through six straight hours of public comment by stakeholders from both inside as well as outside of the protected region, with a wide spectrum of coherence.
Our Take: A sad but true comment “opponents of the leasing program did not allow a lack of education on the issue to stand in the way of holding the microphone hostage.” They filibustered themselves.
Alaska House’s new organization means an uphill climb for governor’s priorities, legislators say
James Brooks, Anchorage Daily News, February 20, 2019
The fate of Gov. Mike Dunleavy’s proposals to roll back a controversial overhaul of Alaska’s criminal justice system will be determined in part by one of the state Legislature’s most prominent advocates of data-based reform. Rep. Matt Claman, D-Anchorage, has been named chairman of the House Judiciary Committee, which is expected to consider the governor’s anti-crime bills if they receive the approval of the Alaska Senate. Claman is the chairman of the Alaska Criminal Justice Commission. The recommendations of that commission — before Claman joined — formed the basis of the criminal justice reform legislation known as Senate Bill 91. Subsequent recommendations contributed to legislative efforts to fix problems with SB 91.
The Drilling Productivity Report uses recent data on the total number of drilling rigs in operation along with estimates of drilling productivity and estimated changes in production from existing oil and natural gas wells to provide estimated changes in oil and natural gas production for seven key regions. EIA’s approach does not distinguish between oil-directed rigs and gas-directed rigs because once a well is completed it may produce both oil and gas; more than half of the wells produce both.
AGDC criticizes Mat-Su Borough for ‘factual and legal errors’
Larry Persily, February 18, 2019
The state’s gas pipeline development corporation and the Matanuska-Susitna Borough continue debating the worthiness of the borough’s Port MacKenzie property for the proposed Alaska LNG project, as the state’s latest filing with federal regulators accuses the borough of “factual and legal errors.” The borough’s most recent comments to the Federal Energy Regulatory Commission (FERC) “simply nit-pick (erroneously, in many instances) around the edges,” the Alaska Gasline Development Corp. (AGDC) told federal regulators Feb. 13. The corporation has not strayed from its choice of Nikiski on Cook Inlet as the best site for the gas liquefaction plant and export terminal. The borough, however, is contesting the state-led project’s evaluation of Port MacKenzie at the entrance to Knik Arm, across from Anchorage, about 65 air miles northeast of Nikiski.
Alaska’s new governor stays mum on Pebble mine
Dylan Brown, Greenwire, February 18, 2019
Alaska’s new Republican governor, Mike Dunleavy, hasn’t taken a public stance on the proposed Pebble mine, despite his “open for business” approach to the state’s resources. But plenty of people think they already know how he feels: The company behind the project rejoiced after Dunleavy’s election, and many anti-Pebble activists presume he favors the controversial proposed gold and copper mine. “It is clear Gov. Dunleavy has been a proponent of the Pebble project,” United Tribes of Bristol Bay Executive Director Alannah Hurley said.
Our Take: A bit surprised this morning to learn that Bristol Bay Today has hired former Murkowski staffer Kevin Sweeney to lobby against the project.
Glencore to Cut Production at Major Copper, Cobalt Mine
Scott Patterson, The Wall Street Journal, February 19, 2019
Glencore PLC plans to curb production at one of its biggest copper and cobalt mining operations, Mutanda Mining Sarl in Congo, according to people familiar with the matter, potentially taking a sizable portion of two important industrial metals out of circulation.
Our Take: We know an excellent source of domestic copper…
Norway gives go-ahead to disputed Arctic copper mine
Reuters, February 18, 2019
Norway’s government last week approved construction of a copper mine near Europe’s northernmost point despite years of opposition from indigenous Sami herders and fishermen. Norway’s decision on the copper mine has been viewed by some as a litmus test for the Arctic, where climate change and technology are enabling mineral and energy extraction, shipping and tourism, but threatening traditional ways of life. In a statement, Industry Minister Torbjoern Roe Isaksen of the center-right coalition government, said the project would strengthen the industrial base in the north and contribute positively to the local community, with new jobs and skills.
While everyone focuses on the budget, Governor Dunleavy is also making changes to how state government runs, looking for efficiency and cost savings. On February 13, he issued a series of administrative orders to begin the process:
Administrative Order No. 307
AO 307 – Transferring the Alaska Oil and Gas Conservation Commission from the Department of Administration to the Department of Commerce, Community and Economic Development.
Administrative Order No. 306
AO 306 – To establish the Statewide Investigator Unit within the Department of Law, establish a task force to implement a plan to consolidate investigators from other designated departments within the Statewide Investigator Unit, and reassign investigators subject to this order and the implementation plan to the Statewide Investigator Unit.
Administrative Order No. 305
AO 305 – To establish Statewide Human Resources Consolidation.
Administrative Order No. 304
AO 304 – To establish Statewide Procurement Consolidation.
Alaska House ends month-long standoff, elects speaker
Becky Bohrer, Associated Press, February 14, 2019
Alaska state Rep. Bryce Edgmon, who changed his party affiliation from Democrat to undeclared earlier this week, was elected House speaker on Thursday, ending a standoff that had paralyzed the chamber. The 21-18 vote came on the 31st day of the legislative session — the longest stretch the House had gone without electing a permanent speaker. It also came the day after Gov. Mike Dunleavy released a budget proposal with sweeping cuts. The House was limited in what it could do without a permanent speaker and majority organization. While lawmakers held private and informational public meetings, they had yet to hear a single bill.
Our Take: The leopard changed his spots and became the House speaker.
Findings released regarding governor’s bid to fire head of state oil and gas watchdog agency
Elizabeth Harball, Alaska’s Energy Desk, February 14, 2019
The state Department of Law has released a “findings of fact” report on whether Gov. Michael Dunleavy has grounds to remove the head of a state oil and gas watchdog agency. The report was prepared by Tim Petumenos, a private attorney who, at Dunleavy’s request, presided over a hearing last week regarding whether French should remain in his position. By law, AOGCC commissioners can only be fired for cause. Petumenos found “substantial evidence” that French was chronically absent from the office, that he failed to perform routine work that then had to be taken on by others at the agency “and that this affected morale at the office,” he wrote in the report.
Our Take: “ His chronic absences didn’t hurt or delay the work of the commission” – um, because, as Petumenos pointed out – other people were doing his work. It’s a great gig if you can get it – $140,000 a year and you don’t have to show up for work or do your work!
Coal exports out of this resource-rich nation brought in record-high revenue last year, according to government data released this month.
The big picture: As concerns about climate change grow, coal is considered on its way out. But for many growing economies in Southeast Asia that are Australia’s biggest coal customers, it’s often seen as the preferred, cheapest electricity option.
Driving the news: Coal exports brought in a record $66 billion (in Australian dollars) in export value last year, according to data from the government’s Bureau of Statistics released earlier this month.
The data also shows that coal surpassed iron ore to become the biggest export in Australia, one of the world’s largest exporters of fossil fuels and other resources.
From the Washington Examiner Daily on Energy:
WHITE HOUSE HAS GRANTED ONE QUARTER OF TARIFF EXCLUSION REQUESTS: The White House has granted about one out of every four requests made for an exception to its 25 percent steel tariffs, granting relief to companies that say they can’t find comparable products made inside the U.S.
“As of February 11th, 66,001 steel and 9,548 aluminum exclusion requests have been filed. Overall, 21,468 steel exclusion decisions have been posted (16,093 were approved),” Commerce Department spokesman Kevin Manning told the Washington Examiner. The ratio of requests made to exclusions granted has held steady over the last few months.
Republican leader says Senate will vote on Green New Deal
Valeric Volcovici, Reuters, February 12, 2019
Republican Senate Leader Mitch McConnell said on Tuesday that the U.S. Senate will vote on a “Green New Deal” introduced by Democrats that aims to slash U.S. carbon dioxide emissions to negligible levels in a decade. “I’ve noted with great interest the Green New Deal, and we’re going to be voting on that in the Senate, give everybody an opportunity to go on record and see how they feel about the Green New Deal,” McConnell said.
Our Take: Let’s get ready to rumble – Markey vs. McConnell, renewables vs. fossil fuels. Markey’s accusation that calling for a vote will sabotage the plan leaves Headlamp wondering what flavor of Kool aid Markey was drinking when writing a bill that calls for the elimination of fossil fuels and no more airplane travel.
Goldman sees oil rising toward $70, says demand forecasts are too gloomy
Tom DiChristopher, CNBC, February 13, 2019
- Goldman Sachs sees Brent crude prices peaking at $67.50 a barrel in the second quarter of the year.
- Brent is struggling to break through $64 a barrel following a sharp oil price pullback at the end of 2018.
- Goldman says the Street is underestimating oil demand and thinks OPEC is taking a “shock and awe” approach to cutting output.
Our Take: Today Governor Dunleavy will release his FY 2020 budget. The revenue numbers are based on oil at $65 a barrel.
Saudi Arabia plans to reduce its crude oil production further, to 9.8 million bpd in March, Energy Minister Khalid al-Falih said in an interview for the Financial Times. This compares with more than 11 million bpd produced in November.
From the Washington Examiner, Daily on Energy:
HOWARD SCHULTZ SAYS GREEN NEW DEAL ‘NOT REALISTIC’: Possible independent presidential candidate and Democratic spoiler Howard Schultz on Tuesday night criticized the Green New Deal, warning it would be “immoral” to spend trillions of dollars on an “unrealistic” solution.
The billionaire former Starbucks CEO and executive chairman, speaking at a town hall hosted by CNN, urged Democrats to be “truthful” about their environmental initiatives rather than just throwing policies “against the wall because it’s a good slogan.”
Could there be seismic in the Arctic Refuge this winter after all?
Elizabeth Harball, KTOO News, Feb 11, 2019
During the final public meeting in Alaska on oil leasing in the Arctic National Wildlife Refuge, a top Interior official said there’s still a possibility that some seismic exploration could be done there this winter. The statement comes after Interior confirmed last week that the early stage oil exploration effort proposed by company SAExploration was off the table this season. Regulators limit seismic exploration to winter, when snow cover helps protect the tundra. Environmental groups and Gwich’in leaders opposed to oil development in the Refuge celebrated the news — they had raised concerns about seismic exploration’s potential impacts. But today, the Anchorage Daily News reported that SAExploration is still pursuing work this winter. During a press conference, Interior’s Joe Balash confirmed that there may still be some wiggle room.
Our take: A huge thank you to the BLM for changing format and taking the time to hear from all interested parties. The Anchorage hearing ran smoothly and many perspectives were voiced. Thank you to everyone who showed up to voice support for opening the 10-02 region in ANWR. Written comments may be submitted here until March 13.
The Trump administration says it’s sticking to plans for an Arctic refuge oil lease sale by year’s end
Yereth Rosen, Arctic Today, Feb 12, 2019
Joe Balash, the Interior Department’s assistant secretary for land and minerals management, said the department plans to complete its environmental review, reach a record of decision and open up the first round of bidding before the end of 2019. “Can all of that happen this year? We think so,” he told reporters during a public meeting in Anchorage on proposed ANWR leasing. The meeting was the seventh of eight scheduled to collect public input on a draft environmental impact statement released in December by the Bureau of Land Management. Balash said Interior officials will “take as long as is necessary to do a robust job and come out with a solid product” that is good for the nation and that minimizes impacts to the region’s Porcupine caribou herd, a point of contention in the drilling debate.
“We think we’ll be done with the EIS sometime in the third quarter this year, but, you know, we thought we would be further along than we are now,” he said.
Our take: Based on yesterday’s hearing, it is clear that the BLM is taking the draft EIS and related concerns very seriously. It is obvious that much hard work and tireless hours that have been spent on the draft EIS. Hopefully by year’s end we see this hard work translate into fruitful studies in ANWR.
Holdout Kenai lawmaker agrees to break leadership deadlock in Alaska House
James Brooks, Anchorage Daily News, Feb 11, 2019
“I’m going to be the 21st vote to support a Republican-led coalition or caucus,” Knopp said. With Knopp’s support, the other 20 members of the House Republican caucus could vote to elect Rep. Dave Talerico, R-Healy, as speaker of the House when the House meets at 10 a.m. Tuesday. The vote could have taken place Monday evening but for the absence of Rep. Ben Carpenter, R-Nikiski. Monday was the 28th day of the legislative session; the old record for disorganization was 22 days, in 1981. Without a speaker of the House, legislation cannot be introduced, bills cannot advance, and the general activities of the House are limited. Twenty-one votes are needed in the 40-person House to elect a speaker.
Our take: Good to see representative Knopp join his peers to finally have some organization down in Juneau. This is especially critical with the Governor’s budget set to release tomorrow, February 13. Hopefully the election of a speaker happens without incident and the newly formed Republican majority can work together for the remainder of session.
The Biggest Threat To Oil Market Stability
Nick Cunningham, OilPrice.com, Feb 11, 2019
Standard Chartered singled out the U.S. government as a major source of volatility. “If the balances were the sole driver of OPEC output policy, the stage would have been set for a relatively quiet year,” the investment bank wrote. “However, there is a disruptive factor in the market which is likely to complicate policy choices; U.S. policy has become harder to predict.” After a quiet first year from President Trump, 2018 was markedly different. “13 market-moving tweets on oil expressing a strong desire for lower prices, significant developments in policy towards Iran and Venezuela, and a sense that domestic energy policy is in a period of substantial flux,” Standard Chartered wrote. “We think that the oil market, oil producers and oil analysts have yet to adapt fully to the uncertainty and policy risks injected into the oil market by the Trump presidency.”
From the Washington Examiner Daily on Energy:
SENATE SET TO APPROVE PUBLIC LANDS PACKAGE: The Senate is expected to approve a public lands package Tuesday evening that would permanently reauthorize the popular Land and Water Conservation Fund, which Congress let expire last year.
Sens. Lisa Murkowski, R-Alaska, the chairwoman of the Natural Resources Committee, and Maria Cantwell of Washington, the panel’s former top Democrat who stepped down from that position this year, have long pushed for the lands package, which also includes measures increasing sportsmen’s access to federal lands, boosting economic development in dozens of communities through land exchanges, and conserving lands of special importance.
New life for key public lands fund: Environmental groups had criticized the Senate for failing to permanently reauthorizing the popular Land and Water Conservation Fund during the last session of Congress. The LWCF gets its money from offshore oil and gas leases, rather than taxpayer money, and pays for public lands projects. It provides money to federal, state, and local governments for buying land and waters to improve national parks, forests, wildlife refuges, and other public areas.
Amendment to limit Antiquities Act fails: During debate of the lands package, the Senate rejected an amendment from Sen. Mike Lee, R-Utah, that would have blocked presidents from using executive authority to declaring national monuments in his state.
Lee and other conservatives have argued presidents, most recently Barack Obama, have abused the Antiquities Act in protecting larger and large swaths of public land as national monuments, and hindering the activities of ranchers.
Borough Mayor Charlie Pierce casts doubt on LNG project
Kat Sorenson, The Peninsula Clarion, February 10, 2019
Kenai Peninsula Borough Mayor Charlie Pierce joins an Alaska energy expert in casting doubt on the proposed Nikiski LNG pipeline. At Friday’s Seward Chamber of Commerce meeting, Pierce said he agreed with Larry Persily, former federal official for Alaska gas pipeline projects and chief of staff for former borough mayor Mike Navarre, who said last week that there is “no possible way” that the Alaska Gasline Development Corporation would make a final investment decision by the end of 2019.
Hearing concludes regarding French’s fate at head of state oil and gas watchdog agency
Elizabeth Harball, Alaska’s Energy Desk, February 8, 2019
A three-day public hearing ended Friday regarding Gov. Mike Dunleavy’s bid to remove Hollis French from his position as chair of the Alaska Oil and Gas Conservation Commission. According to a letter from the governor’s office obtained Thursday by Alaska Public Media, there are five charges against French, described as follows: “chronic, unexcused absenteeism,” “browbeating fellow commissioners,” “publicly undermining the work of AOGCC,” “security breaches” and “failure to perform routine AOGCC work.”
Our Take: You had us at “chronic, unexcused absenteeism…”