Friday, April 20, 2018

What the Shale Revolution Wrought: Fuel Cell Power Changing the World of Power

ConnieMellin.jpgConnie Mellin
Natural Gas NOW


Fuel cell power plants made possible by the plentiful natural gas unleashed by the shale revolution are changing the world of heat and power as we know it.

A fuel cell is a source of power which will efficiently convert clean natural gas into virtually emissions free electricity. You can almost compare a fuel cell to a battery, but the fuel cell will never run down or need to be charged.


Fuel cell power plants are gaining momentum as they are relatively inexpensive to setup and operate.  They need considerably less real estate and have no moving parts making them extremely quiet. They are also very versatile; powering whole communities or serving as backup power to places such as hospitals.

The U.S. Energy Information Administration published a report today explaining the diverse ways fuel cell power plants are being used:


Source: U.S. Energy Information Administration, Form EIA-860, Annual Electric Generator Report

At the end of 2016, the United States had 56 large-scale fuel cell generating units greater than 1 megawatt (MW), totaling 137 megawatts (MW) of net summer capacity. Most of this capacity (85%) has come online since 2013. Fuel cells collectively provided 810,000 megawatthours (MWh) of electricity in 2016, representing 0.02% of total U.S. electricity generation.

Fuel cell systems typically produce hydrogen gas from hydrocarbon fuels such as natural gas using thermochemical processes such as steam reforming. The hydrogen reacts with oxygen across an electrochemical cell similar to that of a battery to produce electricity and water. Although nearly 85% of fuel cell capacity in 2016 used natural gas, fuels such as landfill gas or biogas from the decomposition of sewage at wastewater treatment plants were also used, potentially allowing the generation from fuel cells to qualify for renewable portfolio standards in certain states.

Fuel cell power plants are sometimes used for backup power at small facilities such as hospitals. They can also be used to operate data centers for large private corporations that have committed to consuming 100% of their electricity from renewable sources.

Commercial and industrial sector fuel cell power plants are sometimes used in combined heat and power application, meaning they produce heat and steam in addition to electricity. Overall combined heat and power applications made up 26 MW of the 137 MW operating in 2016; the rest provided only electricity.

Fuel cell capacity factors in 2016 ranged significantly, reflecting a wide operating range for these fuel cells. Some were operated infrequently: 8 of the 50 plants in operation for all of 2016 had a capacity factor of 30% or lower, likely reflecting limited-use applications such as peak shaving or back-up capacity. Some were operated more frequently: about 25% of fuel cell generators had capacity factors exceeding 85%, likely reflecting primary power supply applications.

Fuel cells with combined heat and power applications typically had much lower capacity factors than those that delivered electricity only, with median capacity factors of 44% and 81%, respectively.


Source: U.S. Energy Information Administration, Form EIA-860, Annual Electric Generator Report, Form EIA-923, Monthly Power Plant Report

In 2016, 36% of total U.S. fuel cell capacity was in California, which has a number of incentives for distributed generators such as fuel cells. Fuel cell generating units in Connecticut accounted for 27% of U.S. 2016 fuel cell capacity, and plants in Delaware accounted for 22%. Both states allow fuel cells with nonrenewable fuel to meet requirements for renewable portfolio standards. The remaining fuel cell power plants are located in North Carolina and Utah.

Thanks to the shale revolution, fuel cell power plants are sure to be a large part of our future electricity generation.

The post What the Shale Revolution Wrought: Fuel Cell Power Changing the World of Power appeared first on Natural Gas Now.

Why New York City Needs More Natural Gas

The New York Building Congress stressed that New York City needs more natural gas pipelines before the planned closure of the Indian Point nuclear plant.

Natural-Gas.jpg New York City’s need for energy will expand as Indian Point’s scheduled 2021 deactivation approaches. It points out that 81.5% of the city’s electricity comes from natural gas burned in the five boroughs—and that more will be needed to keep New York’s lights on once the Indian Point nuclear plant is taken offline. The city’s move to transition public and private buildings away from burning heavy oil for heat has accelerated this need. Last winter’s tumultuous weather conditions also provided an important reminder of the growing demand for affordable, reliable energy – and the urgent need for efficient energy infrastructure. Williams’ Northeast Supply Enhancement project is a direct response to this urgent need, providing enough natural gas to serve 2.3 million American homes in time for the 2019/2020 winter season. Northeast Supply Enhancement will also support more than 3,000 jobs and generate approximately $327 million in additional economic activity (GDP) in Pennsylvania, New Jersey and New York. Click Here to ADD YOUR NAME NOW and COMMENT to the FERC requesting the prompt approval of this critical project. Thank you for supporting this key piece of natural gas infrastructure and helping to keep the lights on in New York City. Joseph F. Barone 610.764.1232

Thursday, April 19, 2018

Freeport LNG Delays Start Of Texas Export Terminal To September 2019

Freeport LNG, a privately held U.S. LNG company, said on April 19 it pushed back the projected start date for its $13 billion export terminal under construction in Texas by about nine months to around Sept. 1, 2019. Freeport LNG now expects the first liquefaction train to enter service around Sept. 1, 2019, with the second and third trains seen in service around Jan. 1 and May 1, 2020, respectively, said Zdenek Gerych, a spokesman at Freeport. Previously, the three trains under construction had been expected to enter service between fourth-quarter 2018 and the final quarter of 2019. Each train will have the capacity to liquefy about 0.7 billion cubic feet (bcf) per day of gas. One bcf is enough gas to supply about 5 million U.S. homes for a day.

Wednesday, April 18, 2018

Kinder Morgan Canada Sees Continued Risk On Oil Pipeline Expansion

Kinder Morgan Canada Ltd. said April 18 that its Trans Mountain oil pipeline expansion project was facing "unquantifiable risk" due to the British Columbia government's continued opposition and reported a 5.1% drop in first-quarter earnings. British Columbia said April 18 that it would file a legal challenge in the province to determine whether it has the jurisdiction to stop the C$7.4 billion (US$5.9 billion) expansion, which was approved by the federal government in 2016. Kinder Morgan Canada, which was spun off from parent Kinder Morgan Inc. (NYSE: KMI) in May last year, reported a net income of C$44.4 million (US$35.17 million) for the first quarter ended March 31, down from C$46.8 million for the same period last year.

Anchor’s Away: Marcellus Shale Leaves Cove Point, Future Arrives

17d9481.jpg?resize=75%2C85Jim Willis
Editor & Publisher, Marcellus Drilling News (MDN)


The first real shipment of Marcellus Shale LNG leaves Cove Point, launching a future of US energy dominance and sustained rural Northeast economic revival.

Finally. Finally! Finally!!! The very first cargo of Marcellus Shale gas has been liquefied, loaded and as of Sunday night, set sail from Dominion’s Cove Point LNG plant, heading for we’re not sure where yet. We’ve waited YEARS for this day! Let’s pop the cork on a bottle of the bubbly and celebrate.


Last week MDN told you that a ship called the Patris was due to dock at Cove Point and load the first shipment of Marcellus molecules. It appears that information was incorrect. It was correct at the time! Either the Patris was redirected somewhere else, or we’re not sure what happened.

But, news has just broken that late Sunday night, close to midnight, a ship by the name of Adam departed Cove Point loaded with the very first Marcellus shipment. Several more ships are said to be headed for Cove Point now.

International shipping isn’t our specialty, so we won’t quote chapter and verse for which ships and when. This first shipment that left Sunday belongs to Japan, but there’s no indication it will actually go to Japan.

As we’ve noticed and have been reporting, both Japan and India (which will take all of the LNG Cove Point can produce) are in the game of swapping cargoes they own, sending Cove Point cargoes to customers closer to the point of origin in return for receiving cargoes that originate closer to their own shores.

When we hear where the first Marcellus cargo lands, we’ll let you know. In the meantime, here’s the information we can find about the very first load of Marcellus Shale gas to get exported from Cove Point.

From Reuters:

The first contractual liquefied natural gas (LNG) cargo from Dominion Energy Inc’s newly constructed Cove Point LNG export plant in Maryland in the United States left the facility on Monday, Thomson Reuters Eikon ship tracking data showed.

The cargo is expected to act as a drag on spot LNG prices as it coincides with the resumption of exports of the fuel from the Papua New Guinea LNG plant, which had been shut following a powerful earthquake.

The 160,000-cubic meter LNG tanker Adam LNG left Cove Point on Monday with a draft of 91 percent, suggesting it was full, according to the data. Its destination was not immediately clear.

The facility has exported two commissioning or test cargoes already, which were sold to Royal Dutch Shell. The first cargo from the facility left the terminal in early March heading for Britain’s Dragon LNG terminal.

Dominion Energy was not immediately available for comment outside operating hours.

But the company said last week the terminal had entered commercial service for natural gas liquefaction and exports.

After completing a planned outage for maintenance, the facility has been ramping up to full production of LNG from natural gas provided by its export customers since late March, the company said.

The 177,000-cubic meter tanker LNG Sakura and the 163,000-cubic meter tanker Meridian Spirit are heading to the Cove Point terminal, according to Eikon data.

Cove Point is the second LNG export plant in the lower 48 U.S. states after Cheniere Energy Inc’s Sabine Pass terminal in Louisiana, which exported its first cargo in February, 2016.

Dominion sold the project’s capacity for 20 years to a subsidiary of GAIL (India) Ltd and to ST Cove Point, a joint venture of units of Japanese trading company Sumitomo Corp and Tokyo Gas Co Ltd.

Some of the LNG for ST Cove Point will go to Tokyo Gas and some will go to Kansai Electric Power Co Inc, according to Sumitomo’s Pacific Summit Energy (PSE) unit.


From Platts:

Dominion Energy has exported what appears to be the first commercial cargo from its Cove Point terminal in Maryland, S&P Global Platts vessel tracking software cFlow shows.

The Oman Shipping-owned Adam tanker departed Cove Point about 11:30 pm local time Sunday (0330 GMT Monday) with a nearly full load, en route toward the Suez Canal with the destination unspecified, vessel tracking data shows.

A Dominion spokesman did not immediately respond to a request for comment Monday. The company said last week that commercial service had started, though it did not disclose when the first cargo under long-term contracts with Gail India and a joint venture of Sumitomo Corporation and Tokyo Gas would be exported. Shell had a deal to export all of Cove Point’s commissioning cargoes, suggesting the cargo that left aboard the Adam was a commercial delivery.

The Adam moored at Cove Point’s export platform early on Saturday with a draught of 9.0 m and left a little over 36 hours later with a draught of 11.4 m, just short of the vessel’s maximum draught of 11.8 m, cFlow data shows. The draught is the depth of the vessel below the waterline. Vessels sink lower as more LNG is loaded.

Cove Point feedgas flows have rebounded to a high of 616 MMcf/d for Monday from the recent low of 163 MMcf/d on Thursday and an average of 535 MMcf/d over the last four days, S&P Global Platts Analytics data shows. As of now, the Adam is heading back to where it came from, the Suez Canal. Cove Point is still expecting two more unladen vessels in the coming week as the Kawasaki Sakaide and the Meridian Spirit continue to travel toward the plant with an estimated arrival of April 19 and 21, respectively.

Editor’s Note: And, off we go into a bright new future for Marcellus Shale and the communities benefitting by it. Hail to the future!

For more great articles on natural gas development every single business day, subscribe to Marcellus Drilling News using this convenient link.

The post Anchor’s Away: Marcellus Shale Leaves Cove Point, Future Arrives appeared first on Natural Gas Now.

Tuesday, April 17, 2018

The Old Is New For Energy

Like the song, everything old is new again for oil and gas. The business is re-entering an age of energy abundance much like the 1950s and 1960s and that’s good news for the midstream, according to the chief economist of Houston-based Phillips 66 Co. (NYSE: PSX). Horace Hobbs, speaking April 16 at the 97th annual convention of the GPA Midstream Association, said energy executives “need to change the way they think” as production swells from unconventional shale plays. He said the switch “is a whole new phenomenon” for nearly everyone in oil and gas because for 45 years the industry has been focused on supply following the OPEC embargo during the 1973 Yom Kippur War. That spans the careers of nearly everyone in the business today. Now, the question is finding demand. “We have been exploring for oil in the Arctic and deepwater offshore, we don’t need to do that anymore,” Hobbs said. “It’s a substantial change in the way we think.” Development of the shale plays has become predictable “mining” in comparatively easy-to-reach, land-based plays, he noted. The shales’ abundance means swelling proved reserves that go out 30 to 40 years, even with no additions.

Green Insanity: Offshore Wind Project Cost Mind-Boggling $10K Per KW

IER-light-noletters-75x38.pngInstitute for
Energy Research


Have we lost our minds? A Rhode Island offshore wind project will cost $10,000 per kilowatt, roughly 10 times the cost of a modern natural gas power plant.

Off of the shore of Block Island on the Rhode Island coast, five wind turbines are operating and supplying power to the island. It took years of state and federal policymaking, environmental impact assessments, and town hall meetings for the 30-megawatt wind farm to come to fruition due to its cost and degradation of vistas. It cost $300 million—$10,000 per kilowatt—about 10 times more than the cost of a new natural gas combined cycle unit. Further, it is 55 percent more costly than what the Energy Information Administration (EIA) expects a first-of-a-kind offshore wind unit to cost—$6,454 per kilowatt.

In terms of generation costs, EIA expects a new offshore wind farm to be 3 times more expensive than an onshore wind farm.


And now, fishermen are indicating that the wind farm poses serious threats caused by scattering massive metal shafts and snaking underwater cables across prime fishing grounds. Electricity from the turbines is routed via submarine cables to Block Island and to the mainland.  Fishermen complain that the area where the cable lines extend to the mainland is completely devoid of fish, which used to be fruitful fishing grounds. Fishermen also complained that their lines have caught on the concrete casings that cover portions of cables that are not buried.

Other Offshore Wind Projects Being Considered

Officials are about to announce the winners of bids to develop much larger wind farms 14 miles south of Martha’s Vineyard.  Those offshore wind projects are expected to span hundreds of thousands of acres and generate 1,600 megawatts of turbines within a decade.

Fishermen across the region have been pressing officials for answers to their concerns about where the turbines will be located, how far apart they will be built, and the placement of the cables to the mainland. Commercial fishermen urged regulators to study the potential impact of the proposed wind farms on marine mammals, spawning grounds of herring and squid, and other species that inhabit the area.

The fishermen also raised questions about the impact of electromagnetic waves pulsing across the seafloor on species such as sharks, which navigate and hunt in part by sensing electrical currents, and how rotating turbine blades could impede their ability to navigate with radar.

One company (Vineyard Wind),proposing to build a $2 billion, 800-megawatt wind farm, is considering a different placement of the turbines. Instead of placing turbines in an irregular pattern, which would produce the most energy, the company would position them in rows, eight-tenths of a mile apart that would allow two fishing vessels to drag their nets through the area at the same time.

In 2016, to protect valuable scallop and squid grounds, the fishing industry filed a lawsuit against the Bureau of Ocean Energy Management (BOEM) to stop the development of a 26-mile wind farm off Long Island, New York. Besides scallops and squids, the site for the proposed wind farm includes ocean habitats for loggerhead sea turtles, right whales, black sea bass and summer flounder. Fishermen claim that the government never adequately addressed their concerns and failed to consider alternative locations.


Loggerhead Sea Turtle

They assert that BOEM’s process for awarding the lease failed to properly consider the planned wind farm’s impact on area fish populations and habitats, shore side communities, safety, and navigation, which violates the National Environmental Policy Act, requiring an assessment of these impacts before issuing the lease, a full Environmental Impact Statement, and an evaluation of alternative locations.

BOEM’s failure to consider the impacts to fisheries, safety, navigation and other natural resources prior to moving forward with the leasing process also violates the Outer Continental Shelf Lands Act, which charges BOEM with considering and providing for existing ocean users. And BOEM’s actions violate the Administrative Procedure Act, which prohibits agencies from acting in ways that are arbitrary, capricious, and contrary to law.

The Bureau of Ocean Energy Management is the federal agency located in the Department of Interior that oversees the development of offshore wind projects as well as other offshore projects. Officials at the Bureau indicate that they are conducting studies to address fishermen’s concerns.

Statoil, which is two-thirds owned by the Norwegian government, won the bid to develop 79,000 acres of ocean off Long Island through a federal auction, bidding $42.5 million. Their plan is to erect 80 to 100 turbines 14 miles south of Long Beach, extending south-eastward with a capacity of up to 1,000 megawatts.


States considering offshore wind energy (e.g. Massachusetts, Maryland, New York) need to be aware of the ramifications of constructing and operating wind turbines off their coasts. Not only is the technology expensive, but fishermen believe that the turbines pose a real threat to their livelihoods. The opposition of the fishing industry could prove a hindrance for developers of proposed offshore wind farms.

Editor’s Note: Not only is the capital cost of offshore wind many multiples higher than a modern combined cycle natural gas power plant, but fixed operation and maintenance costs of offshore wind are 13 times higher than those of the latter and the final levelized cost  of energy for offshore wind are more than 2.5 times those of the modern gas-fired power plant. The ratio is still more than two to one after the subsidy value of Federal tax credits are considered and is projected to stay at about that same ratio in 2040. Offshore wind, in other words, is a mind-boggling boondoggle.


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