East
Coast LNG
Posted: 14 September 2003
East Coast offers grand, but challenging prize to LNG developers
Natural gas prices are so high on the U.S. East Coast that consumption
per capita is 40 per cent below the national average. Nearly two fifths
of the population lives in the states stretching from Florida to
Maine, but consumes about a fifth of the gas.
If the East Coast were to expand their consumption to the national
per-capita average, an additional four TCF (~75 million metric tons)
would be needed annually, said Bob Nimocks, president of Zeus Development
Corporation, the conference organizer. Consequently, a number of
developers are trying to expand the East Coast's access to LNG.
Owners of the existing three terminals have been reopening and
expanding their capacities. Tractebel, for example, has expanded
the peak capacity of its Everett, Mass., terminal from 435 to 700
million cubic feet per day (MCFD) and has increased by 65 per cent its U.S.
shipments during 2003.
All totaled, the peak send-out for the three operational East Coast
terminals will climb from 435 MCFD in 2000 to 2,500 MCFD by 2005.
New terminal development, however, may push supplies even further.
Designs range from traditional shore-based terminals like the one
proposed in Fall River, Mass., to terminals located in neighboring
countries, such as the Bahamas, where theoretically NIMBY challenges
are less formidable, to offshore designs that would serve high-value
markets like New York, directly.
One of the key questions is whether LNG will be the price setter
or price taker, said Nimocks. If it's the price setter, it opens
great opportunities to the LNG industry. The conference, entitled
East Coast LNG, will be held Dec. 8-10 at Boston's Seaport Hotel.
Three questions will be examined:
1) How will LNG affect the East Coast market and what is the market's
elasticity relative to LNG's cost?
2) What is the Atlantic LNG industry's capability to deliver more
gas and at what prices relative to competing gas supplies?
3) What are the practicalities of landing more LNG on the East
Coast, given resident concerns over safety, energy security and
environment, and what are the challenges of integrating higher-Btu
gas into U.S. pipelines?
For more information see www.lngexpress.com/eastcoastlng.
Posted by Richard Price,
Editor Pipeline Magazine
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