More On The Alevo Battery Story Posted Earlier -- August 21, 2017

Updates

Februry 11, 2018: there's a global race to control batteries -- and China is winning.

Chinese companies dominate the lithium-ion battery production process, which starts in Congo and ends up in a phone or electric car.

There is a world-wide race to lock up the supply chain for cobalt, which will likely be in even greater demand as electric-car production rises.

So far, China is way ahead. China is by far the biggest consumer of cobalt from Congo, the world’s biggest producer. Chinese refiners import about 94% of their cobalt from the West African nation.

“We’re realizing that the Congo is to [electric vehicles] what Saudi Arabia is to the internal combustion engine,” says Trent Mell, chief executive of exploration company First Cobalt Corp. , based in Toronto.

Chinese firms are keenly aware of Congo’s importance to electric vehicles, he says, and “trying to control the whole ecosystem…from cobalt mining to battery production.”  

Original Post

 
A short note was posted earlier today. Now, more of the story:

From PennEnergy:

A startup company is giving up plans to build boxcar-sized batteries that help power companies save energy or shift to wind and solar power.

Alevo Manufacturing Inc. informed state officials Friday that it was immediately shutting down its factory inside a massive, former Philip Morris USA cigarette plant and filing for bankruptcy protection. The company said it was terminating 245 workers Friday and laying off the remaining 45 by the end of September "due to unforeseen business circumstances."

The company had said in 2014 it projected employing up to 2,500 workers by this year at its factory in Concord, North Carolina.

Alevo hoped to sell its batteries to electric grid operators and utilities, which now have to power fossil-fuel-powered plants up and down quickly to match electricity demand. That uses more fuel than just keeping the plants steadily churning out power at consistent levels.

Instead, the company said it would liquidate its assets under a Chapter 11 bankruptcy case and try to pay off its creditors.

And more:

Alevo's prospects always hinged on solving a notoriously tricky technological problem — how to make a huge, powerful battery that isn't too expensive and can take the punishment of being charged and discharged hundreds or thousands of times. So far, no company has been able to crack that formula at an attractive price.

Another obstacle to its lofty manufacturing and hiring ambitions was that electricity is regulated differently in each U.S. state, and it is not clear in many cases how utilities could make money employing Alevo's battery.

For Tesla acolytes who might have missed the key paragraph in this story, to repeat:

Alevo's prospects always hinged on solving a notoriously tricky technological problem — how to make a huge, powerful battery that isn't too expensive and can take the punishment of being charged and discharged hundreds or thousands of times. So far, no company has been able to crack that formula at an attractive price.

And again, for those wondering why wind and solar are not bringing down electric prices, from the article:

Alevo hoped to sell its batteries to electric grid operators and utilities, which now have to power fossil-fuel-powered plants up and down quickly to match electricity demand. That uses more fuel than just keeping the plants steadily churning out power at consistent levels.

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Cove Point LNG Export Terminal Ready For Commissioning -- August 21, 2017

Data points from Argus Media:

• Maryland
• nation's second major operating LNG export terminal in the lower 48
• ready to test the system; will inject gas into the pre-treatment and liquefactions areas
• on schedule or slightly ahead of schedule
• $3.8 billion project
• peak capacity, one liquefaction train: 
• 5.75 mn t/yr
• 770 mn cf/d
• 21.8 mn cm/d
• when Cove Point comes on line, the contiguous US will have peak LNG export capacit oty of 25.75 mn t/year
• the fourth liquefaction train at Louisian's Sabine Pass LNG export terminal started operating in late July (2017)
• six LNG export projects are being built or completed in the lower 48 
• with these projects, combined capacity in the US should reach 75 mn t/yr
• compare to Qatar: 77 mn t/yr
• customers: India, Japan, Kansas

I track list of potential new LNG export facilities at this site.

This is always a fun site to re-read. 

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Sittin' On The Dock Of The Bay, 

Watchin' The VLCC's Roll In, 

And Then Watchin' Them Roll Away Again

Sittin' on the Dock of the Bay, Otis Redding

Active Rigs Continue To Slide -- August 21, 2017

Active rigs:

$47.44↑	8/21/2017	08/21/2016	08/21/2015	08/21/2014	08/21/2013
Active Rigs	52	32	76	193	185

Two new permits:

• Operator: CLR
• Field: Elidah (McKenzie)
• Comments:

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Monterey Pop

It's been several years since I've watched D.A. Pennebaker's Monterey Pop. I wanted to dance with Sophia to some raucous music. Wow, I had forgotten how really great that music was. Sophia was not really too impressed; she prefers the Beatles. Maybe she would change her mind if she saw Janis Joplin singing Ball and Chain.

Reality Sinks In; Diesel Still Needed To Meet Climate Goals -- Angela Merkel -- Say What? -- August 21, 2017 -- Yes, You Can Re-Charge Your Tesla During The Solar Eclipse

Remember all that talk about France and Germany mandating 100% EVs by 2040? Just to be clear, those were "political" statements by their heads of state; there has been no legislation mandating that in either country.

Today a bit of reality.

First, a French oil company, Total, buys Maersk's oil an gas business for $5 billion -- NY Times.

The Maersk deal would increase Total’s overall production by 160,000 barrels a day in 2018 and make it one of the largest operators of offshore rigs in northwest Europe.

Meanwhile, the poster child for hypocrisy (along with Algore) when it comes to global warming, Ms Angela Merkel has already backtracked on her "gasoline and diesel ban." A reader sent me this story which won't be reported by America's mainstream press and probably not even in Der Spiegel (not to be confused with a catalogue).

It was reported in Reuters. But look at this crazy headline: Diesel still needed to meet climate goals, Merkel says.

German Chancellor Angela Merkel warned on Sunday against a swift abandonment of diesel cars after a series of emissions scandals, saying the fuel is still needed if climate change targets are to be met.

Speaking at a pre-election town hall event on RTL television on Sunday, Merkel called on German carmakers, all of which have been caught using workarounds to cheat nitrogen emissions tests, to work to re-establish public trust in diesel.

"We need diesel if we are to achieve our climate protection goals," she said.

Diesel cars emit less of the greenhouse gas carbon dioxide but emit more of the nitrogen dioxide that can cause breathing problems in high concentrations.

I guess Germany is more worried about nitrogen than CO2 right now. Or maybe more worried about their manufacturing base. LOL.

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Alevo Declares Bankruptcy

Battery company declares bankruptcy; all 290 jobs lost.

Alevo was mentioned once before on the blog, back in 2015. 

This tells me that if the "battery story" is as big as "they" say it is, CEOs at battery companies going bankrupt must be really bad at whatever they are doing (or not doing).

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Watching The Eclipse Safely

We have eclipse glasses for all our pets. We are set.

People are asking whether they can charge their Teslas during the eclipse. Yes, but a) they need to wear eclipse glasses while "re-charging"; and, b) they need to make an appointment -- the waiting time for recharging Teslas is now about 4 hours long. I'm being told it's particularly bad in Lusk, Wyoming where there is only one charging station.

Wow, this is so exciting. I hope the next solar eclipse is at midnight -- it would be a great, great party opportunity. 

Update On Fracking Sand -- August 21, 2017

For newbies, the trends regarding fracking tight oil wells:

• over the past two years, there was increased excitement and talk about huge fracks -- tens of millions of pounds of proppant (sand plus ceramic [man-made "sand"])
• early in the Bakken boom, one million lbs of sand in a typical frack
• BEXP broke the mold; moved early on to 4 million lbs of sand
• concerns about "stability" of sand under all that underground pressure, led to ceramics
• ceramics: very, very expensive
• sand: availability somewhat constrained; EOG took the lead, buying its own sand mines (upper midwest)
• in the Bakken, EOG pushed the envelope with huge fracks using 10 million lbs of sand; sometimes as much as 20 million lbs; it's my impression that EOG uses sand (almost?) exclusively, no ceramics
• then in the past couple of years, particularly in the Permian, operators talked about using huge amounts of sand
• I did not see that much increase in sand usage per well in the Bakken during same time period (there were exceptions -- again, mostly EOG)
• about two years ago, there was increased talk about the price of sand going parabolic due to shortages (early analyst to note this: Mike Filloon; that happened to some extent but I never considered it a "big" deal
• lately, it seems interest in ever-larger uses of sand has peaked
• all that talk about high price for sand may be tempered by all the sand mines being opened in the Permian, west Texas
• it appears that operators are backing away from ceramic; too expensive (relative to sand) and the argument that ceramic is better than sand may not be holding up 

That's how I see it. Others will differ in their overview.

A week or so ago, a reader sent me a link with regard to "sand mines in Texas." For various reasons I did not post the article at that time. Today, a link to a story on Texas sand from The Emergent Group. Data points:

• 1H17: 15 sand mines permitted or approved by Texas regulators
• in the heart of the Permian: in and around Winkler County, TX
• large public companies involved: US Silica, Hi-Crush, Fairmount Santrol
• Hi-Crush: 3 million tons -- nameplate capacity
• Fairmount Santrol: 3 million tons annually of primarily 100 mesh sand
• private companies include Unimin (not to be confused with Eminem), Preferred Sands
• Preferred Sands: to open three mines in Texas; will bring total capacity to 9.6 million tons
• where will the growth be? Trucks; rail will NOT be involved
• Permian Basin: approaching 2,000 lbs of proppant per lateral foot (9,000 feet x 2,000 lbs = 18 million lbs per frack)

A couple of other notes for newbies: older wells will be re-fracked, and going forward, there will be a new progression of fracking --

• initial huge frack
• re-fracks of wells drilled using older completion strategies; in the Bakken, the majority of wells drilling before 2010 probably candidates for a full re-frack
• mini-re-fracks during work-over of existing wells drilled after 2012 that were originally fracked with newer strategies; these mini-fracks could occur on a regular basis every five years or so
• major re-fracks: every five to ten years
• completion strategies to include evaluation of neighboring wells

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The Katie Ledecky Page

Katie Ledecky visiting the grandfather Hagan farm near Williston.

The Market And Energy Page, T+213 -- August 21, 2017

What I will be watching today? Not the eclipse. I'll be watching SRE's  opening now that it appears SRE has the inside track to buy Oncor. From wiki:

Oncor Electric Delivery Company is Texas's largest transmission and distribution electric utility, the 6th largest in the USA, serving more than 10 million Texans living in 401 cities and 91 counties in the state.

Their service territory includes east, west and north-central Texas, including Dallas, Fort Worth, Midland, Odessa, Killeen, Waco, Wichita Falls, and Tyler and other surrounding cities in Texas.

It was formerly known as TXU ....  

Why peak oil failed to materialize over at Rigzone. Previously posted; archived.

Bored waiting for market / news cycle to begin? One can always watch Oregon's DOT live camera streaming: https://www.youtube.com/watch?v=Gqi8SO4siS0. 

Solar eclipse box:

First picture of the eclipse:

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Granddaughters In Gallatin, TN

Waiting for the eclipse. Granddaughter #1 to the far left; granddaughter #2 to the far right, front row.

Sophia, granddaughter #3? Sleeping in her own bed in Grapevine, TX. Will be on her way to TutorTime within the hour.

The Political Page, T+213 -- August 21, 2017

A reader alerted me to this story; thank you.

I never know where to place these stories or even post them in the first place. It's like preaching to the choir. Anyone coming to the blog "on purpose" is paying attention to energy and anyone paying attention to energy knows that one doesn't buy a Tesla to protect the environment.

Perhaps the interesting "thing" in this story is not the story itself, but that it was published by "MSN" news. And perhaps, we finally have a number suggesting how much fossil fuel contributes to US and global electricity (it's a lot).

So, here we go, over at "MarketWatch," MSN: want to fight climate change? Don't invest in Tesla.

"Whilst (sic) the electric vehicles and lithium batteries manufactured by these two companies (Tesla and China's Guoxuan High-Tech) do indeed help to reduce CO2 emissions from vehicles, electricity is needed to power them," Morgan Stanley wrote. "And with their primary markets still largely weighted towards fossile-fuel power (72% in the US and 75% in China) the CO2 emissions from this electricity generation are still material."

In the business world, they use the word "material." In mathematics and physics, the word used for "material" is "nontrivial."

Does it bother anyone that Morgan Stanley appears to be building an ETF built on CO2 emissions?

It could be worse (actually it was): in February (2017), Morgan Stanley advocated for looking at "gender diversity" when analyzing companies.

Quick, name ten Fortune 500 companies with transgender CEOs.

Monday, Monday -- August 21, 2017 -- Libya Declares Force Majeure

Active rigs:

$48.65↑	8/21/2017	08/21/2016	08/21/2015	08/21/2014	08/21/2013
Active Rigs	53	32	76	193	185

RBN Energy: Supply/demand factors impacting the gas storage injection season.

Despite starting the 2017 injection season on April 1 with much less gas in storage than last year, U.S. natural gas prices in recent months have struggled to return to $3.00 levels.  The market has been dealing with a mixed bag of factors, with demand down significantly, mostly due to milder-than-normal weather and the rise of competing generation sources.  On the supply side, even though production has been flat and imports from Canada down, those developments combined with higher exports of LNG have not been enough to prevent larger injections into storage. Now, prospects for a price rally are waning as summer gives way to the more temperate shoulder season. Where does that leave the gas market heading into winter? Today, we begin a series looking at how gas market fundamentals have shaped up this summer as well as prospects for the winter.

This is the latest of our periodic updates on the fundamental factors influencing the U.S. natural gas market based on daily supply/demand data from our NATGAS Billboard report (RBN’s joint report with IAF Advisors).

When we last wrote about U.S. natural gas supply and demand in mid-June in our blog Can’t Stand Losing (Demand), the market was still feeling the bullish after-effects of the withdrawal season (November 2016–March 2017), which, despite an incredibly balmy winter, had concluded with a balance (total supply minus total demand) that was on average more than 3.0 Bcf/d tighter (net shorter supply) than the previous winter and with 400 Bcf less gas in storage than a year earlier.

Insanity. Earlier this morning -- yes, earlier this morning -- I saw a headline over at Rigzone or somewhere (I forget) that analysts felt Libyan oil exports had stabilized now that the government had things under (better?) control. That was about an hour ago that I saw the article that was probably written yesterday. Now over at Twitter, from Platts, we see that "Libya's National Oil Corp declares forcemajeure at key Sharara oil field."

Libya's National Oil Corp. declared a force majeure Sunday on crude deliveries from its key Sharara oil field after a blockade on its pipeline by a militant group on Saturday, a source close to the company said on Sunday.

The field has been offline since Saturday when the Zintan Brigade closed the Rayaina pipeline yet again, the source said.

NOC has not commented on the status of the field, and could not be reached for a comment. Spain's Repsol, NOC's biggest partner at Sharara could not be reached for comment either.

It was not immediately clear why the militant group, regarded as one of the most powerful in western Libya, closed the pipeline.