September 2021, Vol. 248, No. 9

Global News

Global News September 2021

Egypt, Israel Discuss Liquefying Israeli Gas at Egyptian Plants  

Egypt’s petroleum minister, Tarek El-Molla, and Israel’s energy minister, Karen El-Harr, have discussed “future plans” for Israeli gas to be liquefied at Egyptian natural gas liquefaction plants for re-export, the ministers said in a joint statement.  

The statement, which was published by the Egyptian Ministry of Energy on its Facebook account, stated that El-Molla and Al-Harr held bilateral talks over the phone that also dealt with their ongoing cooperation within the framework of the East Mediterranean Gas Forum.  

The two ministers stressed the necessity and importance of strengthening bilateral and multilateral cooperation between the forum’s members to unlock the full potential of gas in the region, according to the statement.  

Egyptian Petroleum Minister Tarek El Molla said that “strengthening bilateral and multilateral cooperation in the field of natural gas between the members of the Eastern Mediterranean Gas Forum will have a fundamental impact and will extend beyond the eastern Mediterranean region.”  

The statement quoted the Israeli minister of energy as saying that “Egypt is an important partner for Israel in all fields, where geographical proximity, in addition to the similarity of environmental characteristics, gives this cooperation in the energy sector great importance. for each country with the aim of achieving energy security for all the peoples of the region.” 

Two Arrested in Mountain Valley Pipeline Protest  

Two people were arrested in Greenbrier County, W. Va., after chaining themselves to construction equipment along the Mountain Valley Pipeline (MVP) route.  

Firemen helped extract the pair, who were below ground in a hole secured to pipeline equipment with chains and a welded pipe, according to the Greenbrier County Sheriff’s office and local news outlets.   

Authorities said one of the two protesters voluntarily climbed out, while the other refused and had to be lifted out. They both face charges of trespassing, obstructing an officer and conspiracy.   

The 303-mile MVP will take natural gas from the Marcellus and Utica shale formations and transport it through West Virginia and Virginia.  The project has faced various legal challenges from environmental groups that have slowed and added to the cost of the project.  

US Senators Target Countries Harboring Cyber-Criminals  

Two senior U.S. senators said they will legislation to fight ransomware attacks on U.S. infrastructure by sanctioning countries that harbor cyber-criminals, as well as by strengthening protections against attacks.  

Senators Marco Rubio, the Republican chairman of the Senate Intelligence Committee, and Democrat Dianne Feinstein, a senior member of the intelligence and judiciary committees, planned to introduce the “Sanction and Stop Ransomware Act.”  

The threat of ransomware attacks against the U.S. midstream industry came home to Americans on the east coast when an attack against the Colonial Pipeline Co. in May led to a temporary shutdown and widespread gasoline shortages at gas stations.  

The Justice Department was later able to help the company recover $2.3 million in cryptocurrency ransom it paid to hackers.  

The Rubio-Feinstein bill would require development of cybersecurity standards for critical infrastructure, tighten regulation of cryptocurrency – which is often demanded as ransom – and direct the U.S. State Department and intelligence community to designate as a “state sponsor of ransomware” any country deemed to provide support for ransomware demand schemes.  

Nigeria Losing 200,000 bpd to Pipeline Damage, Minister Says  

Nigeria is losing an average of 200,000 bpd – more than 10% of its production – to pipeline vandalism, the country’s information minister said.  

Nigeria relies on oil exports for more than half its budget and 95% of foreign exchange. The cost to repair the pipelines alone is roughly $146 million (60 billion naira), information minister Lai Mohammed told a town hall meeting in Abuja.  

“One can only imagine the impact on the economy,” Mohammed said, adding that the resulting spills also had a devastating impact on the water, air and soil quality.  

Typically the damage is caused by thieves who tap pipelines to illegally refine the oil and sell it on the black market.  

Nigeria, Africa’s largest oil exporter, is pumping around 1.47 MMbpd of oil as a result of an agreement with OPEC and other oil-producing nations to curtail output. Its capacity is around 2 MMbpd.  

Mohammed said official statistics showed that between January 2019 and September 2020, 1,161 pipeline points nationwide were vandalized.  

TC Energy Files Claim Over XL Cancellation  

TC Energy Corporation filed a Notice of Intent to initiate a legacy North American Free Trade Agreement (NAFTA) claim under the United States-Mexico-Canada Agreement to recover economic damages resulting from the revocation of the Keystone XL Project’s Presidential Permit.    

With the filing, TC Energy is seeking to recover more than $15 billion in damages the company said it has suffered as a result of the U.S. Government’s breach of its NAFTA obligations.  

TC Energy officially canceled the project in early June following U.S. President Joe Biden’s revocation of a key permit needed for a U.S. stretch of the 1,200-mile project.  

Keystone XL was proposed in 2008 to bring oil from Canada’s Western tar sands to U.S. refiners.  

The pipeline was expected to carry 830,000 bpd of Alberta oil sands crude to Nebraska, but the project was delayed for the past 12 years due to opposition from some U.S. landowners, Native American tribes and environmentalist activists.  

Tokyo Gas to Start Methanation Pilot Program by March 2022  

Tokyo Gas Co Ltd, Japan’s biggest city gas supplier, said on Wednesday it would start a demonstration test of methanation, a technology to help decarbonize city gas, in Japan by the end of March.  

Methanation converts hydrogen and carbon dioxide (CO2) into synthesized methane, an alternative of the main component in natural gas, and it is considered a way of using CO2 as a raw material that could help the company achieve carbon neutrality in 2050, it said.  

Tokyo Gas plans to start the pilot program at its research center in Yokohama, near Tokyo, initially using hydrogen and CO2 procured from outside.  

It also plans to use hydrogen generated by a water electrolysis device from Britain’s ITM Power PLC, which it aims to install at the test site by next June, as well as CO2 emitted and captured from nearby factories or its customers in the future.  

It plans to use Hitachi Zosen Corp’s methanation device.  

Inter Pipeline’s Heartland Petrochemical Complex Nearing Completion  

The Heartland Petrochemical Complex (HPC) is in its final stages of completion in Strathcona County, Alberta, Inter Pipeline announced.  

The estimated $4.3 billion HPC is Inter Pipeline’s largest growth project and will be an industry-leading petrochemical facility converting locally sourced, low-cost propane into high-value polypropylene.   

Despite the prolonged impact of COVID-19, with Inter Pipeline’s adherence to health and safety procedures, HPC has exceeded 14 million work hours without a lost time incident on-site.  

Inter Pipeline said it has negotiated its eighth take-or-pay agreement for HPC’s production capacity, describing the customer as an investment grade, multinational integrated energy producer.  Inter Pipeline has now secured 68% of HPC’s production capacity under long-term, take-or-pay agreements, nearing its stated objective to contract at least 70% of capacity in advance of the facility becoming operational.  

Inter Pipeline is planning a staggered start-up of HPC with the commencement of polypropylene facility operations expected early in the second quarter of 2022. The propane dehydrogenation facility (PDH), which is substantially mechanically complete, is expected to be operational several months later.   

South Korea Signs 20-Year LNG Deal with Qatar  

South Korea’s energy ministry said it had signed a 20-year LNG supply agreement with Qatar for the next 20 years starting in 2025.  

South Korea’s state-run Korea Gas Corp will buy 2 mtpa of LNG from Qatar Petroleum.  

“This long-term contract is considered to have favorable contract conditions, which would help stabilize LNG supply as well as to significantly drop fees,” the ministry said in a statement.  

It did not provide financial details of the agreement.  

The energy ministry added that KOGAS buys 9 million tons of LNG annually from Qatar through long-term contracts, and a contract worth 4.9 million tons of LNG is expected to end in 2024.  

Ivory Coast to Build 200 MW LNG Plant, Says Energy Minister  

Ivory Coast is in talks to build a 200-megawatt power plant fueled by LNG as it seeks to avoid outages that rocked the country earlier this year, Mines and Energy Minister Thomas Camara said.  

A prolonged dry season reduced water levels at hydropower dams in May, leaving households and businesses without power as well as cutting supplies to neighboring West African countries including Mali.  

“We have taken steps to ensure that this circumstantial situation does not repeat itself,” he told a news conference, announcing the plan for the LNG plant.  

The ministry will share further details on the cost and timeframe for the plant’s construction once discussions are concluded, he said.  

The outages in May were a result of a generation deficit of about 200 MW, or nearly 10% of the national power company’s 2,230 MW capacity, its director general said at the time.  

Dominion Energy, Berkshire Terminate Questar Pipelines Deal  

Dominion Energy abandoned the sale of a natural gas pipeline to a unit of Warren Buffett’s Berkshire Hathaway because of uncertainty over whether antitrust regulators would approve it, the companies said.  

Berkshire Hathaway Energy had planned to acquire Dominion’s Questar Pipelines for $1.3 billion in cash and the assumption of $430 million of debt, as part of a larger purchase of Dominion’s natural gas transmission and storage business.  

The Questar termination had no impact on the purchase of the other Dominion assets for $2.5 billion in cash after adjustments plus $5.6 billion of assumed debt. That deal included more than 5,500 miles (8,850 km) of gas transmission pipelines and 775 Bcf of gas storage  

Dominion, based in Richmond, Va., plans to borrow money to repay the $1.3 billion to Berkshire, and repay the loan by year end after selling Questar to another buyer.    

Cheniere: Customers Signing Long-Term LNG Deals Again  

Cheniere’s expanding Sabine Pass LNG plant. (Source: Cheniere)
Cheniere’s expanding Sabine Pass LNG plant. (Source: Cheniere)

U.S. LNG company Cheniere Energy said that customers are starting to sign long-term contracts to buy LNG again.  

“We have begun to see the return of long-term LNG contracts in support of the construction of new liquefaction capacity,” Cheniere CEO Jack Fusco told analysts on an August conference call.  

So far in 2021, he said, the company entered into sales agreements with multiple counterparties aggregating approximately 12 million tonnes of LNG to be delivered between 2021-2032.  

Cheniere said the sixth liquefaction train at its Sabine Pass export plant in Louisiana is on track to enter commercial service in the first half of 2022. The unit will likely start producing LNG in test mode later this year.  

Cheniere also said it continues to develop the Stage 3 expansion at its plant in Corpus Christi, Texas. Corpus Stage 3 is designed to produce over 10 MTPA.  

“Market dynamics on both the supply side and demand side continue to move in our favor and support our conviction in the long-term growth prospects for natural gas worldwide,” Fusco said, noting LNG exports hit a quarterly record 139 cargoes.  

Each of Cheniere’s nine liquefaction trains, including Sabine 6, can produce about 5 mtpa of LNG, or 0.660 MMcf/d of natural gas. 

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