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DoE has conditionally authorised Freeport Terminal to export
LNG to non-FTA countries
Opening up the prospects of export of shale gas to energy-
starved India, the U.S. has granted conditional authorisation
to export domestically-produced liquefied natural gas (LNG) to
countries that do not have a free trade agreement (FTA) with
it.
In a decision, which has major implications for India, the
Department of Energy, on Friday, announced that it had
conditionally authorised Freeport LNG Expansion, LP and FLNG
Liquefaction, LLC (Freeport) to export domestically-produced
LNG to non-FTA countries from the Freeport Terminal on
Quintana Island in Texas.
Given that the companies from countries such as China, Japan
and Britain have already an overwhelming stake in this Texas
company, India is unlikely to benefit immediately from this
grant of licence.
But the decision paves the way for India, which does not have
a free trade agreement with the U.S., to get its companies
seek similar licences for import of the much-needed gas from
the U.S. in large quantities from other terminals.
The existing federal law generally requires approval of natural
gas exports to countries that have an FTA with the U.S.
For countries that do not have an FTA with the U.S., the
Natural Gas Act directs the Department of Energy to grant
export authorisations unless the Department finds that the
proposed exports will not be consistent with the public
interest.
The DoE order
In its 132-page order, the Department of Energy said the
proposed exports are likely to yield net economic benefits to
the U.S.
We further find that granting the requested authorisation is
unlikely to affect adversely the availability of natural gas
supplies to domestic consumers or result in natural gas price
increases or increased price volatility such as would negate the
net economic benefits to the United States, it said.
The Freeport facility in Texas, the Department of Energy said,
is conditionally authorised to export at a rate of up to 1.4
billion cubic feet of natural gas a day (Bcf/d) for 20 years.
The Department granted the first authorisation for the Sabine
Pass LNG Terminal in Cameron Parish, Louisiana, to export
LNG to non-FTA countries in May, 2011 at a rate of up to 2.2
Bcf/d.
GAIL (India) has executed an LNG off-take agreement with
Sabine Pass Liquefaction LLC, for import of 3.5 million metric
tonnes (mmtpa) per annum LNG from the U.S.A on FoB basis.
Supply to start from 2017-18
The commencement of supply is expected to start from
2017-18.
The Department is now processing several other applications
in this regard.
Pushing for U.S. export of shale gas to India, the Indian
Ambassador to India, Nirupama Rao, in a recent talk at the
American Enterprise Institute (AEI), had said that the demand-
supply gap of natural gas in India, estimated at around 2.2
trillion cubic feet (tcf) per annum at present, was likely to go
up to nearly 4 tcf per annum by 2016-17.
The demand of natural gas is expected to be about 8 tcf per
annum by the year 2030.
We estimate that these savings would be in the range of $4-5
per million metric British Thermal Units (mmbtu).
This would result in cheaper electricity, lower subsidies on
urea and other nitrogenous fertilizers, and a more economical
fuel for a variety of industrial and consumptive gas usages,
she argued.
She had said Indian companies had already made some large
investment in the U.S. in this regard.
Already, we have invested significantly in the liquefaction
terminals that are likely to come up in this country. Recently,
GAIL booked 2. 3 mmtpa capacity in the Cove Point LNG
Terminal proposed to be commissioned by Dominion Cove
Point LNG LP in 2017.
During the recently-concluded LNG 17 Conference at
Houston, Indias Petronet LNG and United LNG, LP, have
entered into a conditional agreement to supply LNG from the
Main Pass Energy Hub LNG project in the Gulf of Mexico, with
the final agreement expected to be concluded by year-end.
Thus, by late 2017, on the assumption of DoE approvals, we
are already looking at a scenario of 0.5 tcf per annum of LNG
exports from the U.S. to India, which is nearly 75 per cent of
our current yearly imports of natural gas from all sources, Ms.
Rao said, adding that Indian companies were scouting for
more tie-ups and ownership stakes in the 19-odd terminals
which had applied for export of natural gas to non-FTA
countries.
Besides, other Indian companies, including Reliance Industries
in the private sector, had bought stakes in oil and gas
exploration and production companies, a trend which would
receive a huge boost if export of natural gas was permitted to
India, she argued. According to another study, roughly 20 per
cent of the $133.7 billion invested in U.S. tight oil and shale
gas from 2008 to 2012 has come from abroad, with Indian
companies accounting for a total investment of nearly $4
billion so far.
m.thehindu.com/business/Industry/us-clears-shale-gas-export-to-india/article4727973.ece/?maneref=http://www.google.com/m?q=us+shale+gas+export+to+indja&client=ms-opera-mini-android&channel=new
LNG to non-FTA countries
Opening up the prospects of export of shale gas to energy-
starved India, the U.S. has granted conditional authorisation
to export domestically-produced liquefied natural gas (LNG) to
countries that do not have a free trade agreement (FTA) with
it.
In a decision, which has major implications for India, the
Department of Energy, on Friday, announced that it had
conditionally authorised Freeport LNG Expansion, LP and FLNG
Liquefaction, LLC (Freeport) to export domestically-produced
LNG to non-FTA countries from the Freeport Terminal on
Quintana Island in Texas.
Given that the companies from countries such as China, Japan
and Britain have already an overwhelming stake in this Texas
company, India is unlikely to benefit immediately from this
grant of licence.
But the decision paves the way for India, which does not have
a free trade agreement with the U.S., to get its companies
seek similar licences for import of the much-needed gas from
the U.S. in large quantities from other terminals.
The existing federal law generally requires approval of natural
gas exports to countries that have an FTA with the U.S.
For countries that do not have an FTA with the U.S., the
Natural Gas Act directs the Department of Energy to grant
export authorisations unless the Department finds that the
proposed exports will not be consistent with the public
interest.
The DoE order
In its 132-page order, the Department of Energy said the
proposed exports are likely to yield net economic benefits to
the U.S.
We further find that granting the requested authorisation is
unlikely to affect adversely the availability of natural gas
supplies to domestic consumers or result in natural gas price
increases or increased price volatility such as would negate the
net economic benefits to the United States, it said.
The Freeport facility in Texas, the Department of Energy said,
is conditionally authorised to export at a rate of up to 1.4
billion cubic feet of natural gas a day (Bcf/d) for 20 years.
The Department granted the first authorisation for the Sabine
Pass LNG Terminal in Cameron Parish, Louisiana, to export
LNG to non-FTA countries in May, 2011 at a rate of up to 2.2
Bcf/d.
GAIL (India) has executed an LNG off-take agreement with
Sabine Pass Liquefaction LLC, for import of 3.5 million metric
tonnes (mmtpa) per annum LNG from the U.S.A on FoB basis.
Supply to start from 2017-18
The commencement of supply is expected to start from
2017-18.
The Department is now processing several other applications
in this regard.
Pushing for U.S. export of shale gas to India, the Indian
Ambassador to India, Nirupama Rao, in a recent talk at the
American Enterprise Institute (AEI), had said that the demand-
supply gap of natural gas in India, estimated at around 2.2
trillion cubic feet (tcf) per annum at present, was likely to go
up to nearly 4 tcf per annum by 2016-17.
The demand of natural gas is expected to be about 8 tcf per
annum by the year 2030.
We estimate that these savings would be in the range of $4-5
per million metric British Thermal Units (mmbtu).
This would result in cheaper electricity, lower subsidies on
urea and other nitrogenous fertilizers, and a more economical
fuel for a variety of industrial and consumptive gas usages,
she argued.
She had said Indian companies had already made some large
investment in the U.S. in this regard.
Already, we have invested significantly in the liquefaction
terminals that are likely to come up in this country. Recently,
GAIL booked 2. 3 mmtpa capacity in the Cove Point LNG
Terminal proposed to be commissioned by Dominion Cove
Point LNG LP in 2017.
During the recently-concluded LNG 17 Conference at
Houston, Indias Petronet LNG and United LNG, LP, have
entered into a conditional agreement to supply LNG from the
Main Pass Energy Hub LNG project in the Gulf of Mexico, with
the final agreement expected to be concluded by year-end.
Thus, by late 2017, on the assumption of DoE approvals, we
are already looking at a scenario of 0.5 tcf per annum of LNG
exports from the U.S. to India, which is nearly 75 per cent of
our current yearly imports of natural gas from all sources, Ms.
Rao said, adding that Indian companies were scouting for
more tie-ups and ownership stakes in the 19-odd terminals
which had applied for export of natural gas to non-FTA
countries.
Besides, other Indian companies, including Reliance Industries
in the private sector, had bought stakes in oil and gas
exploration and production companies, a trend which would
receive a huge boost if export of natural gas was permitted to
India, she argued. According to another study, roughly 20 per
cent of the $133.7 billion invested in U.S. tight oil and shale
gas from 2008 to 2012 has come from abroad, with Indian
companies accounting for a total investment of nearly $4
billion so far.
m.thehindu.com/business/Industry/us-clears-shale-gas-export-to-india/article4727973.ece/?maneref=http://www.google.com/m?q=us+shale+gas+export+to+indja&client=ms-opera-mini-android&channel=new
