Off To The Races -- WTI -- September 11, 2018

Updates

Later, 9:51 p.m. CDT: $70.01.

Original Post 

After hours trading:

Going to $70 again before the end of the month?

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The Biology Page

I am blown away by what researchers are finding these days. First it was the color of dinosaur feathers.

Now, it's the "history" of Homo neanderthalensis and Homo sapiens: two different species, and species, by definition don't interbreed.

The book: Who We Are and How We Got Here: Ancient DNA and the New Science of the Human Past, David Reich, c. 2018.

H. neanderthalensis and H. sapiens split 100,000 years ago.

• mitochondrial DNA (mtDNA): maternal, mother to daughter
• high rate of mutation (at least relative to non-mtDNA)
• relatively easy to collect from bones
• especially high density, of all things, in the tiny bones of the inner ear (who would have thought)
• mtDNA clearly indicates that at least "some" neanderthals and "sapiens" interbred -- producing fertile offspring
• occurred at least 50,000 years ago in Africa
• Now, the Denisova Cave, 2008
• in the Atlai Mountains of Siberia
• one of the best samples of ancient DNA ever discovered -- in a bone from a child's little finger
• whole genome mapped
• neither neanderthal or "sapien" -- wow
• a new "human" -- the Denisovians
• specifically chose that name so as not to name a new species 
• it appears:
• modern human lineage split from "whatever existed before" about 770,00 to 550,000 years ago
• the other lineage, then split into Neanderthals and Denisovians between 470,000 and 380,000 years ago
• and then this: Denisovians (Siberian) closer genetically to New Guinea than to Eurasia
• theory
• the Denisovians separated into two lineages between 400,000 and 280,000 years ago
• one branch, the Australo-Denisovians: interbred with modern humans; direct ancestors of present-day New Guineans
• the Australo-Denisovians: a "ghost population" -- known only from genetics; no identifiable skeletal remains
• the story culminates in a population dispersal from the southeast about 14,000 years ago that spread a relatively homogeneous population across Europe and the Near East
• [interestingly, the book on Stonehenge recently read begins 10,000 years ago -- in the same ballpark]
• 8800 BC: first farmers spread into Europe from Anatolia (Turkey)
• 6800 BC: the hunter-gathers disappeared; occurred rapidly once it began
• 5000 BC: Yamnaya culture originating in central Asia swept across Europe, replacing existing populations
• across Europe, the "Corded Ware culture"
• these are most likely the speakers of proto-Indo-European (not the Anatolians)
• Reich explains why the folks of the Corded Ware culture were so successful
• plague
• Beaker folk

It's All About LNG -- September 11, 2018

Earlier today, I posted:

It's all about LNG

• see RBN Energy below
• PetroChina and Qatargas sing 22-year LNG supply deal; link here; 
• around 3.4 million tonnes of LNG annually
• a million tonnes LNG = 48 billion cubic feet NG; 22 x 48 = 1,056 billion cubic feet, or 1 trillion cubic feet? 
• China requires LNG for its push to replace coal with cleaner burning natural gas, a way to reduce air pollution. After Beijing started the program last year, China has overtaken South Korea as the world’s second-biggest buyer of LNG.
• China’s LNG imports may surge 70 percent to 65 million tonnes by 2020, according to consultancy SIA Energy. Last year, China imported a record 38.1 million tonnes, 46 percent more than the previous year.
• Meanwhile Qatar, the world’s biggest LNG producer, is seeking buyers for a planned expansion of its output.
• Exxon, BP reach deals with state of Alaska to provide 23 trillion cubic feet of natural gas, mostly from the North Slope, for the Alaska LNG Project; link here;
• still in talks: COP: for 9 trillion tcf
• Alaska LNG: a $43B-plus project; 800-mile gas pipeline from the North Slope to planned liquefaction plant in Nikiski ("Pat, I'd like to buy a vowel") on the Kenai Peninsula south of Anchorage
• 23 trillion cubic feet of natural gas = eleven (11) years of Bakken production (boe) with Bakken at 1 million bopd and conversion factor of 6001

I knew the PetroChina / Qatar story was big, but I did not realize how big some people thing this story is. See this op-ed over at oilprice. I don't see it quite as "hair-raising" as the writer would suggest.

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The Millennials

I did not know this. A bit of trivia.

From an article in the current issue of The London Review of Books: "What Dettol Can't Fix," by Bee Wilson, a review of Elisabeth's Lists: A Family Story, Lulah Ellender, c. 2018.

Early in the article:

Making lists .... "Others, like the list of eggs, are stock-keeping exercises: taking the measure of our gold. This kind of listmaking is coming back into vogue among millennials with the rise of 'journaling': a habit of listing the good things that happened during the day as a way of improving mental health."

I assume, on a "good day," the "Dow" list is great for "improving the mental health" of the investor class. LOL.

Speaking of the Dow: "In the long run, we are all dead." 

Sea of Heartbreak, Don Gibson

WTI Surges -- Huge Weekly Draw -- API -- I'm Lovin' It -- September 11, 2018

Holy mackerel: a huge, huge draw -- and this explains the surge today --

The American Petroleum Institute (API) reported a major draw of 8.636 million barrels of United States crude oil inventories for the week ending September 7, compared to S&P Global Platts analyst expectations that this week would see a draw in crude oil inventories of 2.7 million barrels.

Last week, the American Petroleum Institute (API) reported a modest draw of 1.17 million barrels of crude oil. I followed the weekly numbers for a whole year recently and then quit following it -- no one seemed interested. And I finally got a "feel" for the weekly numbers.

Comment: I do not recall ever seeing a draw greater than 8 million bbls in one week. I recall 6 - 7 million bbls at the high end; maybe there were some draws approaching 8.6 million bbls but I don't recall such a high number. Now, let's hope the official EIA data validates the API. Very seldom does API and EIA data correlate. [Later: EIA data did corroborate the API data.]

The BR Merton wells have been updated. 

Active rigs:

$69.25↑↑↑	9/11/2018	09/11/2017	09/11/2016	09/11/2015	09/11/2014
Active Rigs	66	56	37	69	198

WTI: surge. Hurricane Florence won't cause a "supply" problem; storm will cause a "demand" problem. And yet WTI surges. End of driving season in the US. Deserves "four arrows" but my limit is three arrows. I'm still waiting for the API weekly crude oil inventories to be posted. 

Six new permits:

• Operator: Kraken Operating
• Field: Winner (Williams)
• Comments: Kraken has permits for a 6-well Knox pad in SWSW 9-158-100; 

Three producing wells (DUCs) reported at completed:

• 33813, 1,591, Petro-Hunt, USA 153-95-23D-14 2H, Charlson, a nice well; t7/18; cum 16K in 25 days;
• 33814, 1,773, Petro-Hunt, USA 153-95-23D-14 1H, Charlson, a very nice well; t7/18; cum 24K after 20 days;
• 33817,  683, Petro-Hunt, USA 153-95-23D-14- 1HS, Charlson, a nice well; t7/18; cum 9K after 15 days;

Administrative Judge Provides "Cover" For PSC Decision On Meridian's Davis Refinery Near The Park -- September 11, 2018 -- Rick Newman: Nominee For The 2018 Geico Rock Award

Updates

September 16, 2018: I may have been wrong in the original post. It was my understanding the PSC was simply asking for a second set of eyes to confirm what they already thought  -- but The Oil Patch Hotline appears to say that the case is closed: the PSC does not have jurisdication:

Efforts by environmental groups to put the Meridian Energy Group refinery at Belfield under the jurisdiction of the ND Public Service Commission were thwarted by an administrative law judge.

The judge, Patrick Ward, early in September ruled that a complaint from the Dakota Resource Council and Environmental Law & Policy Center be dismissed.

Because Meridian changed its plans to reduce the refining capacity from 55,000 BOPD to 49,500 BOPD, the PSC no longer has jurisdiction, the company told Ward.

The ND Dept. of Health had also issued an air quality permit earlier this year for 55,000 BOPD.

“Meridian plans to construct the Davis Refinery 111 as a single phase with a capacity of 49,500 bpd,” said attorney Lawrence Bender. As a result, the Davis Refinery is not a "gas or liquid energy conversion facility", which is subject to the Siting Act under the jurisdiction of the PSC.

“Meridian is not required to obtain a certificate of site compatibility for the facility prior to construction, and the PSC cannot exercise jurisdiction over this matter,” Bender said.

The environmental groups wanted the PSC regulatory authority because the refinery would impact their “use and enjoyment” of Theodore Roosevelt National Park, which is only three miles from the refinery.

Original Post 

Link here.

The judge's opinion is not binding but it provides the necessary "cover" the PUC needs before they vote.

Is it just me, or is this getting tedious?

And then this bit of garbage, some "yahoo" gives the Trump economy a "B."

What don't they want?

The article is here. The "yahoo" actually says some aspects of Jimmy Carter's economy were better than Trump's. That's when I quit reading.

I guess Rick Newman is a nominee for the 2018 Geico Rock Award. And will immediately go to the head of the pack.

The nominees for the 2018 Geico Rock Award can be found at this post.

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Why Isn't The Federal Government Stepping In? Price Gouging

The only thing I can figure out: Texas retailers are incredibly fair. Or lots of competition. But if folks are willing to pay $12.95 (and up) for a toy that retails for less than $1.99, don't complain about the price of gasoline. Or the price of Starbucks coffee. Or the price of an iPhone X.

Comments Have Been Turned Off -- I'm Getting A Lot Of Spam Comments

Something I have not seen before, all the spam. 

Making America Great Again -- British BP Signed Agreement With American SRE To Supply Fuel For Mexico's West Coast Market -- September 11, 2018

From SeekingAlpha: BP to supply fuel to Mexico through planned Baja California terminal

• BP signs an agreement with Sempra Energy's iEnova Mexican subsidiary to supply fuel into Mexico's west coast market
• the deal will provide up to 500K barrels of fuel storage capacity in a terminal in Baja California to supply BP's Mexican network of 54 gas stations, planned to expand to 1,500 stations by 2021
• the space BP will lease is half of the initial capacity of the terminal, with Chevron leasing the other half
• the agreement also gives BP the option to purchase a 25% stake in the terminal once it is completed 

These are the kinds of deals AMLO can't afford to stop (for review) -- he can't afford to stop them for so many reasons.

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Tesla Bonds Continue To Fall

Date: September 11, 2018

Screenshot:

Efficiency -- Making America Great Again -- September 8, 2018

From the hayride: 600 days.

From gateway pundit. 600 days.

From the cheatsheet: vacation time. It appears Trump is taking twice the number of vacation days, playing twice as much golf as his predecessor and still accomplishing four times as much for the American people.

This is a most interesting graph. Look at the US debt to GDP ratio.

Unemployment at record lows or near record lows: the overall unemployment rate; African-American unemployment rate; Hispanic unemployment rate.

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Dinosaurs and Color

This may just be the coolest thing I learned all week: how scientists are figuring out how to determine the color of dinosaurs. This is absolutely fascinating. I first read about it in: The Rise and Fall of the Dinosaurs: A New History of a Lost World, Steve Brusatte, 2018.

A very, very clever young scientist figured it out.

I think it raises a lot of metaphysical questions. Seriously.

Here's how scientists are figuring out the colors of dinosaurs:

• from National Geographic, 2010
• from Popular Science, 2017

Trudeau's Advice: Look At The Big Picture -- Priceless -- September 8, 2018

From what I can tell, the big picture:

• beholden to the milk industry in Ottawa
• by the way, from The Atlantic: Trump's not wrong about Canadian dairy
  
• NAFTA coming to an end
• 2020 sulfur ruling will kill the Canadian oil sands
• Alberta pulls out of climate accord
• four major pipelines killed
• reputation: can't close a deal

From The Globe and Mail.

One person who doesn't like free trade; Trudeau likes tariffs. 

********************************

Checking Out The Canadian Dollar?

T+30: WTI Up 2% -- September 11, 2018

WTI: No oil platforms off Wilmington, North Carolina so I don't think Hurricane Florence is the reason for the jump in oil prices. And I don't think it's the Iranian sanctions, but that will be the story.

Booooom! The Dow just spiked up 140 points. All other major indices following. 

Fightin' Schwa: The Rosebud Sioux tribe and the Fort Belknap Indian reservation have filed a lawsuit seeking a withdrawal of Washington’s approval of the controversial Keystone XL oil pipeline. From oilprice.

In his August ruling, Judge Morris said that the State Department had to “analyze new information relevant to the environmental impacts of its decision” before approving the Keystone XL project. The same judge will hear the Rosebud Sioux and Fort Belknap case.

I Love Rock n' Roll, Joan Jett

Another Trump Record -- It Simply Never Quits -- America Is Back -- September 11, 2018

"Trump" as a metonym. Another record:

By the way, that China story, the headline, China won't retaliate. Imagine one billion people out of work in downtown Beijing.  Last week, the consensus on CNBC (the movie I was watching; others were watching a different movie, I assume) was that the Chinese would outlast Trump in the tariff wars.

By the way, did anyone catch this story?

Elenore, The Turtles   ******************************************* Notes for the Granddaughters  

We were stationed at RAF Lakenheath for three years back in the late 1980s. I was working the RAF Mildenhall clinic, a flight surgeon's clinic at the sister base to Lakenheath. My assigned aircraft was the F-111. I was one of two flight surgeons at RAF Mildenhall. We provided support for the SR-1st 71 "Blackbird" community. 

Some time after we came back to the states, the SR-71 mission was ended at RAF Mildenhall; and the F-15 replaced the F-111 at RAF Lakenheath.

While at RAF Mildenhall, I often visited the home of a British gentleman who built a new house right at the edge of the fence line at the end of the runway. I am pretty certain this is where the filming for this video was done. The wall of his home closest to the base was less than five feet from the fence line, and had a huge window from which he watched and filmed air base operations. He sold Maerklin railroad hobby trains -- that's how I met him.

Look how incredibly active this base is -- F-15s and then C-130's taxiing in, in the background. And then a KC-135, 100 Air Refueling Wing -- obviously taking part in this same mission. My hunch is after max take-off, the F-15s will re-fuel for a long training mission.

Minimal markings on the C-130s and the personnel surrounding the C-130s suggest to me these are Special Ops. I had one mission with Special Ops while assigned to RAF Mildenhall, flying into Norway.

Holy mackerel -- it turns out there were three KC-135s. Clearly a big training exercise. 

From RAF Lakenheath. Wow, look at the after-burners kick in:

EOR was right across from the elementary - middle school - high school on base. Teaching had to shut down when fighters took off.  

Pin The Tail On The Donkey -- September 11, 2018

Reposting: pin the tail on the donkey:

Sophia is learning this new game at her new Montessori school. She can do it blindfolded.

Oh, I'm sorry. Wrong chart.

With apologies to real cartoonists.

Everybody's talkin' --

Everybody's Talkin', Harry Nilsson

Breaking Now! I Can't Keep Up -- I Just Mentioned China Trade War Moments Ago -- And Now This -- September 11, 2018 -- 9:16 A.M CT

Disclaimer: this is not an investment site.

Enquiring minds want to know: what's riskier -- being in the market, or being out of the market?

Feel the love:

What Is Love? Night At the Roxbury

Yeah, Take My Breath Away -- Trump Sets All-Time Record -- America Is Back -- September 11, 2018

"Trump" as a metonym. 

Yeah, take my breath away!

Reposting:  from  CNBC so you know it's true:

U.S. small business optimism surged to a record in August as the tax cuts and deregulation efforts of President Donald Trump and the Republican-led Congress led to more sales, hiring and investment.

The NFIB Small Business Optimism Index jumped to 108.8 last month, the highest level ever recorded in the survey's 45-year history and above the previous record of 108 in 1983, set during the second year of Ronald Reagan's presidency. 

The August figure was up from a 107.9 reading in July.

China trade war? What trade war? The folks over at CNBC must be watching a different movie than the one I'm watching.

And more! Airlines say booming US economy led to record summer travel. By the way, some weeks ago I suggested that air travel this past summer was the reason gasoline demand in the US was down compared to a year ago. On target, or what!

Take My Breath Away, Berlin

The Energy, Market, And Political Page, T+30 -- September 11, 2018

Tesla: customers can have any color they want as long as it's black. I can't make this stuff up.

Wow, take a look at this CLR well:

• 33123, 2,904,  CLR, Mountain Gap 10-10H, Rattlesnake Point, 63 stages; 15 million lbs, a huge, huge well; Mountain Gap wells are tracked here: t6/18; cum 127K 7/18; 74,624 MCF = 12,435 boe + 127,000 bo = 140K boe in two months. At $50/bbl, about $7 million at the wellhead.

Pool	Date	Days	BBLS Oil	Runs	BBLS Water	MCF Prod	MCF Sold	Vent/Flare
BAKKEN	7-2018	31	72321	72304	63098	74624	73769	480
BAKKEN	6-2018	30	52803	52816	52613	52548	51466	714
BAKKEN	5-2018	1	1702	1232	1041	847	832	15
BAKKEN	4-2018	0	0	0	0	0	0	0
BAKKEN	3-2018	4	76	76	131	754	0	754

Texas highways: I just spent 90 minutes on the road taking the granddaughters to school, picking one up from 0700 (7:00 a.m.) dental appointment .... yada, yada, yada ... we actually "beat the bus" by 30 minutes ... the traffic was rush hour traffic and it flowed incredibly well -- mostly due to a) courtesy of Texas drivers; b) NASCAR philosophy -- no harm, no foul; and, c) the frontage roads. I wish everyone had the chance to drive Texas highways.

Goldman Sachs: on the radio I heard reports of economy growing twice as fast as GS forecast; the economy setting new records. Can't find the link on the internet. Yet.

Optimism. It's hard to believe CNBC would actually report this:

U.S. small business optimism surged to a record in August as the tax cuts and deregulation efforts of President Donald Trump and the Republican-led Congress led to more sales, hiring and investment.

The NFIB Small Business Optimism Index jumped to 108.8 last month, the highest level ever recorded in the survey's 45-year history and above the previous record of 108 in 1983, set during the second year of Ronald Reagan's presidency.

The August figure was up from a 107.9 reading in July.

But not to fear: CNBC then posts this -- "here's where he gets credit and what could go wrong."

NO KO: rocket man did not put his nuclear missiles on display in the Sunday parade, I am being told. Kim has sent a second letter to Trump. Must be feeling the pressure. Trump will make almost every US president and every modern US president look like a wimp. One wonders if WWII would have been shortened by a full year had Trump been in office. By the time it's all over, Trump is going to out-Truman HST.

HST: Hunter S Thompson.

Walkin', Talkin', Cryin' Barely Beatin' Broken Heart, Highway 101
Disclaimer: this is not an investment site.

The market: buying opportunity. Everywhere. Wow, the market turned around fast. If you snooze, you looze.

Fees: the other day I mentioned that "we" were headed to no fee trading. Now this: Vanguard is losing the battle on two fronts in the "fees war." What a great country.

Speaking of losing: Turkey.

Danger Zone! Trump Sets All-Time Record -- September 11, 2018 -- America Is Back!

Re-posting: from  CNBC so you know it's true:

U.S. small business optimism surged to a record in August as the tax cuts and deregulation efforts of President Donald Trump and the Republican-led Congress led to more sales, hiring and investment.

The NFIB Small Business Optimism Index jumped to 108.8 last month, the highest level ever recorded in the survey's 45-year history and above the previous record of 108 in 1983, set during the second year of Ronald Reagan's presidency.

The August figure was up from a 107.9 reading in July.

Yeah, we're in the danger zone ...

Danger Zone, Kenny Loggins

Another Incredible CLR Mountain Gap Well To Be Reported Today -- September 11, 2018

Tuesday morning, September 11 .... cyclic, not linear ...


Time for another road trip?

On Route 66 to Oatman, going south from Kingman, Arizona
Disclaimer: this is not an investment site. Do not make any investment, financial, job, travel, or relationship decisions based on what you read here or think you may have read here.

Headline: stocks slump as China plans trade retaliation. Nice to be overweight in dividend-paying equities with automatic reinvestment. Just saying.

Really fast. And really furious:

API weekly crude oil inventories: pending later today.

So, we'll see how relevant Iran is. I doubt very relevant. The pundits suggest crude oil could surge in price due to Iranian sanctions. My hunch: a big nothing sandwich. But if there is a surge in prices, it has to do with heavy oil / light oil imbalance.

Fast and furious:

• South Korea: grants US wish for zero oil imports from Iran; link here;
• today's article in The WSJ on peak oil demand is amateurish and irrelevant; just saying; link here; any doubt? see LNG story below and the comments at the linked article
• speaking of amateurish and irrelevant: Serena Williams, also at The WSJ; she's not even a millenial; a loser; Martina Navratilova got it right;

It's all about LNG

• see RBN Energy below
• PetroChina and Qatargas sing 22-year LNG supply deal; link here; 
• around 3.4 million tonnes of LNG annually
• a million tonnes LNG = 48 billion cubic feet NG; 22 x 48 = 1,056 billion cubic feet, or 1 trillion cubic feet? 
• China requires LNG for its push to replace coal with cleaner burning natural gas, a way to reduce air pollution. After Beijing started the program last year, China has overtaken South Korea as the world’s second-biggest buyer of LNG.
• China’s LNG imports may surge 70 percent to 65 million tonnes by 2020, according to consultancy SIA Energy. Last year, China imported a record 38.1 million tonnes, 46 percent more than the previous year.
• Meanwhile Qatar, the world’s biggest LNG producer, is seeking buyers for a planned expansion of its output.
• Exxon, BP reach deals with state of Alaska to provide 23 trillion cubic feet of natural gas, mostly from the North Slope, for the Alaska LNG Project; link here;
• still in talks: COP: for 9 trillion tcf
• Alaska LNG: a $43B-plus project; 800-mile gas pipeline from the North Slope to planned liquefaction plant in Nikiski ("Pat, I'd like to buy a vowel") on the Kenai Peninsula south of Anchorage
• 23 trillion cubic feet of natural gas = eleven (11) years of Bakken production (boe) with Bakken at 1 million bopd and conversion factor of 6001

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Back to the Bakken

Wells coming off the confidential list today --

• 34545, 3,425, MRO, Hartvig 14-8TFH, Killdeer, 45 stages; 6.4 million lbs, t8/18; cum -- 
• 34072, SI/NC, Petro-Hunt, JL Moberg 153-95-18C-20-1HS, Charlson, no production data,
• 34355, SI/NC, XTO, Bobcat Federal 14X-35E2, Bear Creek, no production data,
• 33847, 2,462, WPX, Otter Woman 34-27HP, Mandaree, Three Forks, 51 stages; 8.5 million lbs, t8/18; cum -- 
• 33123, 2,904,  CLR, Mountain Gap 10-10H, Rattlesnake Point, 63 stages; 15 million lbs, a huge, huge well; Mountain Gap wells are tracked here: t6/18; cum 127K 7/18;

Date	Oil Runs	MCF Sold
7-2018	72304	73769
6-2018	52816	51466
5-2018	1232	832
3-2018	76	0

Malaguena Salerosa, Chingon
Active rigs

$67.75→	9/11/2018	09/11/2017	09/11/2016	09/11/2015	09/11/2014
Active Rigs	66	56	37	69	198

RBN Energy: Part 4, plentiful Permian gas drives NextDecade's Rio Grande LNG export project.

Each of the “second wave” liquefaction/LNG export projects along the U.S. Gulf Coast now closing in on a Final Investment Decision (FID) believes it has an edge — that special something that will enable it to cross the finish line ahead of its competitors.

Things like a prime location, access to an existing network of natural gas pipelines, lower capital costs, or going with smaller “midscale” liquefaction trains instead of traditional big ones. Some tout the experience and depth of their executive teams, while others claim that thinking outside the box is key. Time will soon tell which two or three (or four) projects advance to FID. Today, we continue our series on the next round of liquefaction/LNG export terminals “coming up” with a look at NextDecade’s plan for the Rio Grande LNG project in Brownsville, TX, which would export large volumes of Permian and Eagle Ford gas.

By this time next year, there’s a good chance that at least one new greenfield liquefaction/LNG export project will get the financial go-ahead and start construction. And, given the expectations that global LNG demand will keep growing and that U.S. shale plays like the Permian and the Marcellus/Utica will remain highly competitive sources of gas supply, it would be a fair bet that we’ll see several projects under way by the end of 2020.

This blog series is a primer on the projects that appear to be in the running. Earlier, we reviewed the dramatic shift in U.S. expectations regarding LNG a few years back. Through the 1990s and the first two-thirds of the 2000s, U.S. natural gas production was close to flat, so the general thinking was that U.S. gas output had peaked, and that over time, increasing amounts of LNG would need to be imported to keep pace with gas demand. It became clear by 2010-11, however, that the Shale Revolution — and the resulting boom in U.S. gas production — had eliminated the need for LNG imports. In a flash, many of the companies that had just finished building LNG import terminals started exploring the possibility of adding liquefaction plants at those sites to export LNG instead. Since then, six liquefaction/LNG export projects advanced to FID and construction — and five liquefaction trains (four at Cheniere Energy’s Sabine Pass in southwestern Louisiana and one at Dominion’s Cove Point in Maryland) with a combined capacity of more than 23 million tonnes per annum (MMtpa) are up and running.

Later, we began our second-wave project with a deep dive on Tellurian’s Driftwood LNG, a proposed 27.6-million metric tons per annum (MMtpa) liquefaction/LNG export terminal in Louisiana’s Calcasieu Parish, south of Lake Charles. In contrast to the large-scale liquefaction trains now operating at Sabine Pass and Cove Point and under construction along the Gulf Coast (generally with capacities of 4 MMtpa or more each), Driftwood LNG will consist of as many as 20 smaller, modular-based trains (1.38 MMtpa each). Also, Tellurian is acquiring natural gas reserves that will be tapped to produce gas for the LNG project, and it is developing two 2-Bcf/d long-haul pipelines — and a 96-mile, 4-Bcf/d connector pipe — to deliver most of the natural gas that the Driftwood trains will demand. To help finance its project, Tellurian is seeking a handful of customers/partners that would take a combined 60% to 75% equity interest in a holding company that will own all those assets, which will give the customers/partners equity LNG at the tailgate of the liquefaction trains at cost (an estimated $3.00/MMBtu).

Then we turned our attention to Venture Global’s plan for two large projects, also along the Louisiana coast: the 10-MMtpa Calcasieu Pass project in Cameron Parish (south of Lake Charles) and, after that, the 20-MMtpa Plaquemines project along the Mississippi River southeast of New Orleans. Venture Global is “going small” too, planning a total of nine liquefaction “blocks” at Calcasieu Pass, each with two 0.6-MMtpa liquefaction trains, for a total of about 11 MMtpa of capacity. The modular design of the trains is aimed at accelerating the pace of construction and minimizing project costs. (The Plaquemines project will have 18 liquefaction blocks, again each with two 0.6-MMtpa trains.) Unlike Tellurian, however, Venture Global is taking the same approach to project financing taken by the first round of U.S. liquefaction/LNG export projects, namely lining up a number of long-term, “take-or-pay” Sales and Purchase Agreements (SPAs) with international LNG traders, foreign utilities and other major LNG buyers. (Venture Global announced on September 7 that it has just lined up a new, 1-MMtpa SPA with Repsol.)

Today, part 4.

Slim Whitman

A 7-mile walk from RAF Menwith Hill to Pateley Bridge, Yorkshire, England -- many, many times.

Lodging while stationed at RAF Menwith Hill:

A Fool Such As I, Baillie and the Boys