Tuesday, May 20, 2014

Speculation On Terms Of That Russian-Chinese Natural Gas Pipeline Deal

Updates

Later, 5:17 p.m. central time: we got the answer -- or $9.50 to $10 per thousand cubic feet.
 
Original Post
 
For background, see this post on the Russian-Chinese natural gas pipeline deal-in-progress

Someone who understands natural gas pricing better than I writes succinctly, if the deal gets done:
  • If price is $9 per mmbtu then China has really played hardball. 
  • If price is $11 per mmbtu then Russia has really won. 
  • If between then they are working together. 
In North Dakota, a reader writes his natural gas bill:
  • $8.18 per mmbtu which includes a basic service charge, and a distribution fee per mcft.
  • the actual cost of gas was $ 6.76 per mcft.
Now, we just have to watch if the deal gets signed, and if the terms are announced. I will have to rely on readers to watch the trade journals. 

[1 mcft = 1 mmbtu]

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