DeepResource

Observing the renewable energy transition from a European perspective

Archive for the category “gas”

Break-even Price Natural Gas and Green Hydrogen in Sight

At current natural gas prices of 65 euro/MWh and 60 euro per ton CO2-tax, green hydrogen becomes competitive.

In all the misery of the high (import) gas price, there is also consolation: the break-even price for green hydrogen is now 3 €/kg. Almost all analysts expect that we will be able to produce this alternative to natural gas ourselves for 1-2 €/kg in the not too distant future.

The cumbersome and somewhat random process of looking for new sources of fossil fuel could be almost over and can be replaced by merely sticking a wet finger up in the air, so to speak.

[twitter.com] – Martien Visser

Shell to Enter Dutch Gas & Electricity Market

[source]

The largest electricity and gas producers in the Netherlands are: Vattenfall, Essent, Engie, CCI, Delta, EDF, Eneco and E.ON. Tens of additional but smaller players do co-exist.

Oil major Royal Dutch Shell has been given the green light by market supervisor ACM to enter the Dutch gas & electricity market. Shell will be selling kWH’s and m3 to private households, sourced from Dutch solar & wind-parks, as well as gas that is “CO2-compensated”. Shell says it has the ambition to become a significant competitor on this market, as well as to be a major player in the energy transition, under the motto: “pump less, trade more”.

[nos.nl] – Shell gaat groene stroom en gas leveren aan consumenten thuis
[nl.wikipedia.org] – Nederlandse elektriciteitsmarkt
[independer.nl] – Overzicht Nederlandse energieleveranciers

Enormous Iranian Gas Find

Iran has announced last week that it has discovered a gas field in the Iranian part of the Caspian Sea, near Chalus, 150 km north of Tehran [map]. The development will be done by Iranian Khazar Exploration and Production Company (KEPCO), but, interestingly, with Russian and Chinese assistance. Gas reserves of the new field are estimated to be 25% of the largest gas field in the World, South Pars, also in Iran.

According to Ali Osouli, CEO of KEPCO, if the initial estimates are confirmed and exploration success is achieved in the Chalous structure, the Irani sector of the Caspian Sea will play a significant role in gas exports to Europe in the near future, in which case Iran’s new gas hub will be formed in the north to let Iran supply 20% of Europe’s gas needs from this region.

European energy options apparently got a big boost.

[kepco.ir] – New Gas Hub in Northern Iran
[oilprice.com] – Iran’s Huge Caspian Gas Find Is A Geopolitical Gamechanger
[eurasian-research.org] – Recent Developments in the Caspian Energy Strategy of Iran

Norwegian Oil & Gas Production Forecast

[source] With a Norwegian population of 5.4 million, for every inhabitant, wealth increases with almost a single barrel of oil per day or $75. As a result, Norway sits on the largest public fund in the world, value 1 trillion $. Norway is a large investor in North Sea renewable energy infrastructure.

OSLO, June 11 (Reuters) – Norway is betting on hydrogen and offshore wind for its energy transition but will continue to extract oil and gas until 2050 and beyond, the outgoing centre-right government said as it presented its long-term energy strategy on Friday.

Europe’s second largest oil and gas producer will continue to hold regular licensing rounds, offering exploration acreage to energy firms, the government said.

[reuters.com] – Norway not ready to let go of oil, gas in push for greener energy

First Stretch Nord Stream 2 Completed

President Putin of Russia prevailed, again. Nord Stream 2 is a geopolitical fact of the first order and will be an important stepping stone towards improving EU-Russian relations.

Vladimir Putin has just announced that one of the two legs of North Stream 2 has been completed and that gas is ready to be pumped from Russia to Germany. The second leg will be completed within two months.

For true Europeans, this is an event to celebrate.

[rt.com] – First stretch of Nord Stream 2 gas pipeline completed on Friday morning Putin reveals, despite vehement US objections to scheme
[reuters.com] – Putin says Nord Stream 2 gas link to be finished as U.S. seeks good European ties
[clingendael.org] – Macron’s overtures towards Russia deserve support, not scorn

Even traditionally Anglophile Netherlands and its #1 foreign policy think tank Clingendael understand that Russia is the future, certainly after Brexit (England out, Russia, Scotland, Ulster, Wales in). Russia is a European country (white, Christian, accepts the classic Greek-Roman heritage) and wants to be integrated into the European world. Together with Russia, Europa can finally escape from the embarrassing situation of being a colony of a former colony and can even begin to plan to reverse roles between Europe and a declining USA.

Wolfgang Ischinger Proposes Nord Stream 2 Compromise

[spiegel.de] – A Possible Solution to the Nord Stream 2 Conundrum
[wikipedia.org] – Wolfgang Ischinger

Whatever.

As long as the pipeline gets completed and major continental European geopolitical facts are created.

Interesting new perspective:

Obviously, state-of-the-art technology has been used and the pipeline can transport up to 80% hydrogen. It is the compressors that would have to be adapted, which means 20% in additional costs.

[neweurope.eu] – What if Nord Stream 2 transports hydrogen?

Russia has endless empty landmasses, without NIMBYs, that could have huge wind farms installed that produce hydrogen, that could be pumped into the pipeline, providing a Russian source of revenue for after the end of the oil age, when America will be history and containing China the new challenge of Paris-Berlin-Moscow.

Chinese geopolitical visions of the near future, centered around their New Silk Road project, a closet-anti-Anglo Eurasian overland strategy. The last lines in the sidebar on the left read: “The Iron Silk Road will interlink about 75 per cent of the world’s population in more than 40 countries in Asia and Europe. China hopes to complete its massive infrastructure project within ten years. It will include at least one line running 320 km/hour and will shorten land-transport time between London and Beijing from 15 to only two days – if Europe is willing to connect, that is.” Of course, Europe should be willing as it would terminate the US empire, with Europe returning to world prominence, where it belongs, based on its immense heritage, second to none.

Just sell the pipeline as a weapon against climate change.

Past & Future of Dutch Energy Production

Dutch revenue from “homegrown” natural gas peaked in 2013 with more than 15 billion euro.

Dutch sources of wealth are many:

  • Being the gatekeeper of a continental European hinterland of 440 million, where much of the bulk goods need to pass Rotterdam Harbor, providing numerous economic opportunities to add value, like in huge refineries.
  • Being a flat country, Dutch agriculture with endless greenhouses, providing fresh food 12 months per year, with potent customers like Germany, France and Britain nearby, making the tiny Netherlands the 2nd agricultural exporter in the world after the US.
  • Prominent large corporations with global reach, like Philips Electronics, Royal Dutch Shell, Unilever, the new rising star ASML semiconductors, KLM, AKZO-Nobel, ING, RABO-bank, Heineken, AEGON, the list goes on.

Another large source of income however is drying up though: natural gas. Once owners of the 9th natural gas field in the world in the sixties, meanwhile only 20% of that supply is left. Exploitation has almost halted due to soil subsistence. But there is good hope that income from offshore wind from the Dutch part of the North Sea can replace the income from natural gas. No wonder that the Dutch government is eager to play a prominent role in the emerging hydrogen economy in Europe.

The Dutch part of the North Sea (57,000 km2) is 1.5 times larger than the Netherlands itself. Note the circles, indicating the projected artificial energy islands, that will be used for the conversion of wind electricity to hydrogen, using the existing fossil fuel pipeline system on the bottom of the North Sea for transport to shore.

How large is the renewable energy potential of the North Sea? Huge. The Dutch ambition is to install up to 75 GW of offshore wind power before 2050.

The Dutch part of the Doggerbank alone has 24 GW potential

But that’s the ambition. What is the potential? The nearly finished Borssele 1.5 GW offshore wind park has a size of 344 km2. Scale that up to 57,000 km2 to arrive at 249 GW. Include a capacity factor of 65% and the remaining figure is 161 GW. That would be equal to half of the current average electricity consumption of the entire EU! Over a year that would amount to 471741 GWh. If we (rather arbitrarily) would set an electricity price of 10 cent/kWh, the corresponding annual turnover would be 47 billion euro or 3 times the maximum amount from natural gas in 2013.

In other words, offshore wind electricity and green hydrogen promises to be big business for the Netherlands. Natural gas won’t be missed.

[cbs.nl] – Aardgasbaten op laagste niveau in ruim 40 jaar
[topsectorenergie.nl] – The Netherlands’ Long-Term Offshore Wind R&D Agenda

Ontwikkeling Aardgasverbruik Nederland tot 2030

In 2030 heeft NL volgens naar verwachting 30 miljard m3 gas nodig om haar economie draaiende en haar gebouwen warm te houden. Dat is dan 35% van het primaire energieverbruik

[twitter.com] – Martien Visser

Gas Prices at Record Low

Prices for aardgas (“earth gas”) as natural gas is known in the Netherlands, have plummeted to ca. 4 cent/m3, a historic low. Corona is an important factor, but prices had already come down before the virus. Oil prices dived below zero for a brief moment earlier. Good for the economy, not good for the transition.

Due to taxes, consumer prices didn’t change and remained at ca. 22 cent/m3.

[nrc.nl] – Prijsrecord aardgas, het is nu bijna te geef
[nos.nl] – Gasprijs in twintig jaar niet zo laag als nu

Nord Stream 2

With 1,222 km the longest sub-sea pipeline in the world. The US are against building Nord Stream 2, but 66% of the German population wants to see the pipeline build. Construction of Nord Stream 2 began in May 2018. The project is expected to be completed by the end of 2019.

Nord Stream I = 55 billion m3/year
Nord Stream II = 55 billion m3/year

That’s an amount of energy of 110 billion m3 gas = 1100 billion kWh or 1100 billion / 0.5 billion Europeans = 2200 kWh per European per year.

Rationale: supply security, read become independent from unreliable overland intermediaries like the Ukraine.

[wikipedia.org] – Nord Stream
[dw.com] – War and fuel: Angela Merkel’s headaches in Russia talks
[thelocal.de] – Construction begins on gas pipeline connecting Germany to Russia

German AfD populists pressing to get the pipeline built, explicitly calling to ignore US demands

Netherlands – Natural Gas Connections Prohibited in Newly Built Homes

[officielebekendmakingen.nl] – Official Dutch government announcement that as of July 1, 2018, it is forbidden to connect newly built homes to the national natural gas grid.

[volkskrant.nl] – Dutch national newspaper is afraid that the government is pushing too hard with the transition and is running the risk of putting too much burden on society. Heat pumps (6-20k) and solar panels (5k) don’t come cheap as compared to gas heating (2k).

N.B. the solution could be public/private financing/renting schemes over 10-30 years. Heat pumps earn themselves back in 7-14 years. Solar panels in 6-9 years.

Who Is Buying Gas 2002-2022

[iea.org] – Natural Gas

Dutch Natural Gas Reserves

Reserves left: 891 billion m3
Annual consumption: 40 billion m3
Years remaining at current consumption levels: 22

It is not possible though to keep consuming at the current rate as the northern part of the country is literally sinking through the floor.
Or to put it differently: the country is “cracking up”:

[source] “Kraakpand”

[volkskrant.nl] – Hoeveel gas heeft Nederland eigenlijk en waar ligt het allemaal?

Sino-Myanmar Pipelines

china-pipelines[source]Sino-Burma pipelines refers to planned oil and natural gas pipelines linking Burma’s deep-water port of Kyaukphyu (Sittwe) in the Bay of Bengal with Kunming in Yunnan province of China. The Myanmar section of the gas pipeline was completed on 12 June 2013 and gas started to flow to China on 21 October 2013. The oil pipeline was completed in Aug, 2014. The oil pipeline will have a capacity of 12 million tonnes of crude oil per year. The gas pipeline will allow delivery of natural gas from Burma’s offshore fields to China with an expected annual capacity of up to 12 bcm of natural gas.

On the 29th of January, China opened, with little fanfare, a new oil link through Myanmar… This 2,400km long pipeline runs through some of the most rugged areas on the planet, marked by jagged hills and ridges and dense jungle… The new route however, has one invaluable advantage in eyes of Chinese leaders: it bypasses the Malacca straits, whose infamous waters are infested with pirates… The pipeline shortens the distance the oil will have to travel by sea to reach China by 700 miles. It also cuts by 30% the time this liquid black gold will take to get to the Middle Kingdom… Avoiding the Malacca detour had the other, even more invaluable advantage in the eyes of the Chinese leadership. With 80% of all imported hydrocarbons to China going through the Malacca sea-route, China is vulnerable to having its overseas energy supplies blockaded by the American 6th Fleet during a Sino-U.S. geopolitical crisis… Another even bigger behemoth project is now in the works, a railway line is being discussed, which will follow the route taken by the pipelines. This project has a price tag of $20 billion dollars and would allow China to more easily import Burma’s precious wood and all sorts of other commodities, while also facilitating the flow of Chinese workers to the coast.

china-burmaThe new pipelines circumvent the 805 km narrow passage of the Straits of Malacca.

[en.wikipedia.org] – Sino-Myanmar pipelines

[forbes.com] – With Oil And Gas Pipelines, China Takes A Shortcut Through Myanmar

Top Ten Gas Reserves

gas-reserves2

[twitter.com]

Natural Gas Extraction Triggers Earth Quakes

The natural gas field in the northern Dutch province of Groningen was once the 9th largest in the world and contributed significantly to Dutch prosperity since 1960. Original size field: 2.8 trillion m3 (100 trillion ft3). Current yearly extraction rate 80 billion m3, of which 40 bcm is exported. All in all, the Netherlands expects to be self-sufficient for ‘several decades’.

[dwarshuis.com] – more impressive pictures here

The trouble is: you can’t extract ca. 2 trillion m3 from a relative small area without noticing it above the ground. Unsurprisingly the soil subsides and earth quakes with a Richter strength of 3.5 are happening all the time and cause considerable damage to buildings and infrastructure. The province and its citizens are up in arms and demand a decrease in extractions.

Government response? Increase speed implementation renewable wind energy and [drum-roll] consider increasing gas imports from… Russia! This situation can be exploited by the Dutch government by suggesting to its own public that we cannot afford to jeopardize our already strained relation with Russia, so that’s why our secret service is sabotaging the investigation. But it is all for your own good, dear citizen. In this manner, the Dutch can avoid embarrassing their imperial overlord USA for the reward of 122.5 repatriated gold from the US. Everybody happy, perhaps even Russia, since nobody accuses Russia anymore about MH17. No longer in anybodies interest.

[elsevier.nl] – ‘Russisch gas is optie bij dichtdraaien gaskraan Groningen’
[wikipedia.org] – Groningen gas field

South Stream 2.0

gas_to_eu_final_3

It is a done deal now: South Stream is history.

Or is it?

The map shows the Black Sea pipeline (“Turk Stream”) that is going to be built, with almost the same trajectory as the original South Stream one, except that now the new pipeline will end in Turkey rather than in Bulgaria. The difference is that Turkey is not member of the EU (and never will be) in contrast to poor Bulgaria. Turkey is not interested in obstructing the construction of the pipeline with “Third Energy Packages”, like the EU did until Putin called Brussels bluff, and says ‘thank you very much’ to Putin-Russia for this little present. Turkey and Russia, unlike the Euro-fools in Brussels, realize that Europe will need natural gas for decades to come. A pipeline through Turkey means additional billions of income for Turkey from transit fees, to be paid by European consumers, ruled by incompetent US satraps in Brussels. On top of that, Turkey will get an enormous and completely unnecessary political leverage over Europe, just because the Euro-cowards are too afraid to kick American *** hard by refusing to take any more orders from Washington. If Europe does something Turkey doesn’t like, Turkey can shut off essential gas supply in a minute.

The new situation also encourages Turkey to loosen its ties with the West and become a member of the SCO alliance, the alliance with a future, unlike the West. This new alliance will enable Turkey to project its power over the Arabian peninsula with the end goal of reestablishing the Ottoman Empire and removing the US from the Middle-East. And all the signs are that this is precisely Turkey’s intention. And as long as the US has a big mouth against Russia and China, both the latter will give Turkey the free hand in the Middle-East, as long as it hurts US interests. The West gets smaller with every passing day.

For fourteen years, Putin-Russia’s grand strategy has been rapprochement to Europe

putin-schroeder-chirac
The big winners in the Iraq drama after giving Washington the finger in 2003.

…but at a decisive moment, Europe and its two greatest losers Merkel and Hollance…

Merkel-and-Hollande-012[source]
Spineless dangerous incompetent European losers, determined to run Europe into the ground by obeying any order from Washington, like giving Europe away to Islam.

… did not have the guts to oppose the neocon-criminals in Washington and say no to the Ukrainian misadventure. Now the SCO-strategy is to weaken the West by ‘stealing’ Turkey from the alliance, in perfect symmetry with the theft of Ukraine and attempted theft of Syria from the Russian sphere of influence. And Turkey, being the de facto natural leader of Islam and potential owner of most of the fossil fuel resources west of the Gulf, is a much more valuable ally than basket case Ukraine.

Putin playing chess
The Western ‘je suis Charlies’ outfoxed again by the geopolitical Grandmaster.

[rt.com]

EU Offers to Guarantee Gas Deliveries to Ukraine

Ukraine-Russia_gas_pipelines[source]

Earlier this week, Russia and Ukraine agreed on the price ($385/1000m3) of Russian gas deliveries for the coming winter. That’s settled then. Oh wait, Ukraine has no money. No worries, there is still the EU, we mean, the European tax payer. EU Energy Commissioner Gunther Oettinger suggested that if the Ukrainian gas company Naftogaz could not pay for the gas, the EU could buy the gas and resell it to Ukraine, obviously against soft conditions. Another suggestion could be that Russia will subtract the price of gas deliveries to Ukraine from the transfer fees it is paying to Ukraine for the right to transfer gas to Europe, through Ukraine. Europe is Russia’s most important source of income. Gazprom is lukewarm about the idea of the EU playing the cavalier, probably because in this way, Russia is loosing political leverage over Ukraine. Therefor Gazprom points at existing contracts that supposedly forbid reselling practices.

Next week a final agreement is expected between all parties involved.

[rt.com] – Ukraine’s multi-billion dollar gas debt: Who pays?

Russian-Ukrainian Gas Deal

Ukraine pipeline[source]

Ukrainian president Poroshenko has confirmed that natural gas supply from Russia has been secured for the coming winter, after an agreement was reached over the price: $385/1000m3. On top of that Ukraine will repay a part of its outstanding gas debts.

[news.antiwar.com]

Editor: it means that Ukraine has caved in 100% to Russian demands. The alternative would have been Ukrainians freezing in their homes. Ukraine could have had gas for $269, as negotiated under ousted president Yanokovich, but after EuroMaidan and the CIA-sponsored coup, Ukraine went west. Well then, don’t expect a discount.

What If Russia Stops Delivering Gas to Europe?

boycot-1
The EU commission wrote an internal report about what the consequences would be if Russia decided to stop delivering natural gas to Europe. The result can be seen in four graphs, depicting the European situation after 1, 3, 6, and 9 months respectively without Russian supply. Green is normal, dark red means less than 50% of normal consumption.

Read more…

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