Donlin Gold Advancement! US LNG #2 for China. Price takers, not price makers.

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From the Washington Examiner, Daily on Energy:

INDUSTRY PUSHES BACK: The oil and gas industry is bobbing and weaving as the Biden administration and congressional Democrats punch at domestic producers over high energy prices.

President Joe Biden has found himself in the position of trying to address voter worries over rising prices — particularly gas prices — while pursuing the goal of reducing fossil fuel use over time.

That has led to his blaming oil and gas companies for the current outlook, in the form of a request that the Federal Trade Commission investigate companies for anti-competitive conduct, rather than his asking them to expand production.

Producers are also being targeted by Democratic lawmakers, some of whom have called on Biden to impose a ban on fuel commodity exports. Sen. Elizabeth Warren of Massachusetts, (who has proposed a complete ban on fracking), is one of said lawmakers and has gone a step further, accusing 11 energy companies of “corporate greed” in a recent spate of letters to the firms’ executives.

Companies say they’re being scapegoated: ExxonMobil CEO Darren Woods dismissed the accusations from Biden and Warren in an interview this morning, implicating market dynamics.

“This is a commodity market. The prices are set by the amount of supply that’s out there, and by the amount of demand,” said Woods.

The heads of Marcellus Shale Coalition, the Gas & Oil Association of West Virginia, and the Ohio Oil & Gas Association, whose members operate in the Appalachian region, wrote Warren yesterday over her letters, calling her claims part of a “deeply misguided, headline-grabbing ploy” and boasting the industry’s role in shaping the energy-cheapening shale revolution.

The industry is made up of “price takers, not price makers,” Mike Chadsey, director of public relations for the Ohio Oil & Gas Association, told Jeremy. “Other people tell us what our commodity was worth.”

Charlie Burd, executive director of the Gas & Oil Association of West Virginia, called the claim that companies are profiting off exports at someone else’s expense “unfair” and said that global supply chains and U.S. allies are strengthened by exported gas.

He also noted that natural gas prices hit an all-time low during the pandemic, calling it “supply and demand 101” that prices would increase with the demand during the pandemic recovery.

“You can’t look at prices over just a very short period of time,” Burd said. “We have to understand that the bigger picture is all commodities shift in price.”


U.S. Tries To Patch Things Up With OPEC After SPR Release
Charles Kennedy, Oil Price.Com, December 1, 2021

The United States is taking a crack at improving its relations with OPEC—notably with Saudi Arabia—after the federal government repeatedly blamed the group for high U.S. retail fuel prices and then announced the release of 50 million barrels of crude from the strategic petroleum reserve to push international oil prices down.

Bloomberg’s Javier Blas reported this week that White House senior energy security advisor Amos Hochstein has traveled to the Middle East, where he met with government officials, including Saudi Arabia’s Energy Minister Abdulaziz bin Salman.

“We discussed areas where the U.S. and Saudi Arabia can partner to invest in the energy transition and collaborate to build a 21st century clean energy architecture,” the senior Washington official said, as quoted by Bloomberg.

According to unnamed sources familiar with the discussion, the U.S. representative told the Saudi side that Washington supported OPEC decision-making, although President Biden and Energy Secretary Jennifer Granholm more than once criticized that very decision making that, according to them, resulted in higher prices for American drivers.

This support for OPEC decision-making on the part of the White House may mend fences with Saudi Arabia but is unlikely to sit well with American oil and gas companies. President Biden’s calls on OPEC to increase production earlier this year were received poorly by the U.S. shale patch, which believes it can take care of the supply problem.

Biden has chosen not to approach the local energy industry for help.

“If I were gonna make a call, it wouldn’t be long-distance, it would be a local call,” said Occidental’s CEO Vicki Hollub last month. “I think first you, you stay home, you ask your friends, and you ask your neighbors to do it. And then if we can’t do it, you call some other countries.”


China redraws seaborne LNG map, looks to America for supplies
Sam Chambers, Splash 247.Com, December 1, 2021

China has redrawn the map of global seaborne LNG trades this year, dismissing trade tiffs with America, to dramatically boost the overall tonne-mile scenario for LNG carriers, which have hit record spot earnings in excess of $300,000 per day over the past month.

The United States is now China’s second largest LNG supplier, having surpassed the likes of Qatar, Malaysia, and Indonesia.

“China appears to have been shoring up its energy requirements, signing up nearly a dozen long-term LNG contracts this year, with half of those being done in the fourth quarter. Although Australia looks set to be the biggest supplier of LNG to China this year, the US is moving up the ranks to take second position, according to S&P Global Platts,” stated a new report from brokers Lorentzen & Stemoco today.

Australia sent 25.9m tonnes of LNG to China in the first 10 months of this year, considerably more than any other gas exporter. However, Australia’s share of total imports dropped to 39.7% from 43% in 2020. In the first 10 months of this year, American LNG exports accounted for for 11% of China’s total imports, up from 3% in the previous year.

China’s Foran Energy signed a 20-year LNG supply contract last week with Cheniere to purchase four LNG cargoes a year from 2023 to 2042. The contract was the fourth big gas deal signed between the two nations in the last few months.

Earlier this year, China surpassed Japan to become the world’s largest importer of LNG, adding to a long list of commodities in which the People’s Republic is the number one buyer.

Clarksons has estimated that China’s greater reliance on non-Asian providers of LNG this year has helped up tonne-mile demand by a massive 30% in 2021.


Barrick and NOVAGOLD Agree on Next Steps Toward Advancement of Donlin Gold

Drill Assay Results Continue to Yield High-Grade Intercepts and Demonstrate Important Grade Continuity

With Clear Improvement in Definition of Controls and Mineralization, the Project is Advancing Towards Feasibility Study Update

Anchorage, Alaska – Donlin Gold LLC (“Donlin Gold”), owned 50/50 by Barrick Gold Corporation (“Barrick”) (TSX: ABX) (NYSE: GOLD) and NOVAGOLD RESOURCES INC. (“NOVAGOLD”) (TSX, NYSE American: NG), is pleased to report progress made during the executive management workshop and site visit in early September between senior representatives from Barrick and NOVAGOLD, as well as the Donlin Gold management team. Additional assay results for 18 completed drill holes, plus partial results for 22 holes from the 2021 drill program are reported below.

  • During the September 2021 executive management meetings in Alaska, the combined team reaffirmed its confidence in the deposit and charted a course toward advancing the project up the value chain
  • In addition, senior executives, including Barrick and NOVAGOLD CEOs Mark Bristow and Greg Lang, met with local stakeholders as well as senior Alaska Federal and State government officials who expressed their continued strong support for the project
  • Assay results from approximately 65% or 15,700 meters of drilling continue to support the global resource estimate, recent modelling concepts, and strategic mine planning work
  • With a progression plan in place, subject to results from the upcoming drill program the partners are well positioned to be able to proceed with a feasibility study update in 2022

2021 Drill Program Delivers Consistent Results

The 2021 drill program was completed in September with 79 holes drilled for a total of 24,264 meters. To date, Donlin Gold has reported assays for 36 complete holes and 22 partial holes, encompassing 15,700 meters of length drilled. The last core was logged in mid-October with final samples sent off site to laboratories for further processing. The camp was closed at the end of October and is expected to reopen in January 2022 for a winter drill program. Final results from the 2021 drill program are expected to be disclosed in 2022.

The primary objective of the 2021 drill program was to complete the work necessary to validate and increase confidence in recent geologic modeling concepts to support future feasibility work.

The logging and assay results will be incorporated into a geologic model update, followed by a shift in focus to feasibility study work, subject to a formal decision by the Donlin Gold Board. Initial assay results from the 2021 drill program were disclosed in a media release on September 2, 2021, five of the top intervals received since this release include:

  • DC21-1976 intersected 57.25 m grading 6.87 g/t gold starting at 270.35 m drilled depth, including a sub interval of 4.05 m grading 18.13 g/t gold, starting at 288.95 m drilled depth;
  • DC21-1970 intersected 19.15 m grading 12.57 g/t gold starting at 173.19 m drilled depth, including a sub interval of 12.15 m grading 17.28 g/t of gold, starting at 179.19 m drilled depth;
  • DC21-1964 intersected 37.85 m grading 6.28 g/t gold starting at 110.65 m drilled depth, including sub intervals of 7.95 m grading 15.99 g/t gold starting at 110.65 m drilled depth and 3.13 m grading 10.21 g/t gold starting at 143.37 m drilled depth;
  • DC21-1980 intersected 12.18 m grading 19.02 g/t gold starting at 293.40 drilled depth; including a sub interval of 4.65 m grading 36.53 g/t gold starting at 300.29 m drilled depth;
  • DC21-1994 intersected 33.53 m grading 5.89 g/t gold starting at the surface; including a sub interval of 6.06 m grading 15.22 g/t gold starting at 9.24 m drilled depth.
  • Drill-hole collar locations and five of the top intervals are shown in Figure 1
  • Drill-hole orientations, depths and significant intervals are shown in the Appendix at the end of this release, in Tables 1 and 2, respectively. Those holes, designated as being in the Divide area, are on the eastern side of the ACMA pit area, transitioning into the Lewis pit area, as shown in Figure 2. These new and significant high-grade drill hole intercepts point toward the potential feeder zones of this large system. Part of the objective of the 2022 exploration and drill program will be to confirm mineralization continuity and key geologic controls in representative areas of the deposit.

Statements by the Owners

Barrick President and Chief Executive Mark Bristow said, “Getting together in Alaska, visiting the Donlin project site and sitting down with stakeholders drove home the significance and importance of Donlin to both partners. We have a unique opportunity to progress a world-class project in both a jurisdiction and with local partners that recognize the contribution such an asset can bring to the lives of future generations of Alaskans. Our priority is to do that responsibly and sustainably and it is an illustration of Barrick’s and NOVAGOLD’s strong partnership that we were able to have such a productive workshop and come away with next steps to move the project forward.”

Greg Lang, NOVAGOLD’s President and CEO, said, “The successfully concluded site visit and the meetings that followed with our Alaskan constituencies provided an excellent lead-in to Barrick’s and NOVAGOLD’s onward progression for the Donlin Gold project. The identification of key work plans represents a most welcome and important achievement in taking Donlin Gold up the value chain and is the natural extension of confirmation work carried out with our partners at Barrick, which includes the recently completed drill campaign. This campaign is not only yielding high-grade intercepts in the future open-pit areas; Donlin Gold’s 2021 drill program is producing some of the best drill results seen lately in the gold mining industry, from juniors to majors. I’m sure I speak for both Barrick and NOVAGOLD when I say we are grateful to our local and state partners, who have worked with us to reach these important milestones.”

Dan Graham, General Manager of Donlin Gold added, “We enjoyed hosting the senior management teams from both Barrick and NOVAGOLD here in person in Alaska. We are also energized with the interest and resources the owners are dedicating to the Donlin Gold project. It is a great economic opportunity for the region and the State.”

About Donlin Gold

The Donlin Gold project is located in Alaska, the second largest gold-producing state in the U.S. With approximately 39 million ounces of gold grading 2.24 grams per tonne in the measured and indicated mineral resource categories (100 percent basis)1, Donlin Gold hosts one of the largest and highest-grade undeveloped open-pit gold endowments in the world. The planned pits in which the existing resources are sited occupy only three kilometers of an eight-kilometer mineralized belt, which itself is located on less than 5% of Donlin Gold’s land position. Current activities at Donlin Gold are focused on the drill program, optimization efforts, community outreach, and advancing the remaining State permitting actions.

Donlin Gold is a committed partner to the Alaska Native communities both surrounding the project and within the State as a whole. This commitment underpins Donlin Gold’s approach and is also reflected in the way in which the asset itself is structured. An important factor that distinguishes Donlin Gold from most other mining assets in Alaska is that the project is located on private land designated for mining activities five decades ago. Donlin Gold has entered into life-of-mine agreements with Calista, which owns the subsurface mineral rights and some surface land rights, and The Kuskokwim Corporation (TKC), a collection of ten village corporations, which owns the majority of surface land rights, and is committed to providing employment opportunities, scholarships to Calista and TKC Shareholders, and preferential contract considerations to Calista and TKC. These agreements also include royalties which are subject to a revenue-sharing structure established in the Alaska Native Claims Settlement Act of 1971, which resolved Alaska Native land claims and allotted 44 million acres of land for use by Alaska Native Corporations. Additionally, our long-term commitment to economic development in the Yukon-Kuskokwim region is exemplified by Donlin Gold’s support of TKC’s initiative to launch energy and infrastructure projects in middle Kuskokwim villages. These partnerships, activities, and programs are illustrative of the commitment to sustainable and responsible development of the Donlin Gold project for the benefit of all stakeholders.


Former Anchorage Sen. Cathy Giessel, defeated in 2020, will run again in 2022
James Brooks, Anchorage Daily News, December 1, 2021

Former Alaska Senate President Cathy Giessel will run for her old Senate seat in next year’s election, two years after losing narrowly in the Republican primary to a political newcomer.

Giessel did not announce her candidacy but on Tuesday, the Alaska Division of Elections reported that she had filed as a candidate. She confirmed her candidacy Wednesday morning by text message and said she would be able to talk later in the day.

Roger Holland, the incumbent who defeated Giessel in 2020, has filed as a candidate with the Alaska Public Offices Commission, which regulates campaign fundraising.

Holland defeated Giessel in the 2020 Republican primary amid a wave of Republican dissatisfaction over the handling of the Permanent Fund dividend. Giessel was one of seven legislative Republicans who lost primary elections that year.

Since then, Alaskans have approved a new election system that allows four candidates, regardless of party, to advance to the November general election, where a winner will be chosen by ranked-choice voting.

In addition, the boundaries of Giessel’s former district have been changed by redistricting, and the politics of the Permanent Fund dividend have changed, with more legislators advocating a new long-term formula.


IEA report: A stronger renewables forecast still falls short
Ben Geman, Axios, December 1, 2021

New data shows renewable power is surging globally but remains off the pace with what’s needed to meet the ambitious goals of the Paris climate agreement.

Driving the news: The International Energy Agency is out with its latest snapshot and near(ish) term forecasts.

  • Power capacity additions are setting another annual record this year at around 290 gigawatts, led by solar.
  • IEA has significantly increased its forecast for renewable power growth over last year’s report.
  • It now sees capacity growing by 60% from 2020-2026 to reach around 4,800 gigawatts.

Yes, but: “[E]ven this faster deployment would still fall well short of what would be needed in a global pathway to net zero emissions by mid-century,” IEA notes in a summary.

“That would require renewable power capacity additions over the period 2021-26 to average almost double the rate of the report’s main case.”

It also notes that rising commodity and shipping costs could delay some projects.

Read the report