Or it would be, if we have the fuel to heat the water.
Some of you know that I have a peripheral involvement with the natural gas biz, having been hanging around major natural gas facilities for the last twenty years. Yes, I know – electrical guy – what can I know, right?!?
I pay attention.
2005. LNG gasification plant I had a part in maintaining and upgrading, its job was to receive shiploads of liquid natural gas from overseas producers, gasify it, and put it into the pipeline for sale to American customers. Domestic gas prices in 2005 ranged from six to over thirteen dollars per million BTU. Overseas producers pulled gas out of the ground cheap, liquefied it, shipped it, and everybody made a decent profit along the chain.
2011. American fracking is on line big time. No more ships showed up at our terminal for the last three years. You can’t send it to America cheaper than we get our own stuff. Prices from 2011 to 2021 range from two bucks to six.
American business says, “You know, we’re cheap enough to where we can sell this overseas” and started building liquifaction plants to take American gas, liquefy it, and ship it overseas.
Today. Europe’s screwed. They bet the farm on Russian gas, then pissed off the Russians. While they were happily setting up their dependency on Russian gas for ‘clean’ energy, they were shutting down coal and nuclear, building solar and wind generation.
Solar and wind don’t pull the load when things get real. And Russia’s pinching down on the gas flow. And winter’s coming.
And America’s selling every drop of liquid natural gas it can produce, sending most of it to Europe, and one, it’s not enough, and two, it’s not as cheap as it used to be. We’re selling gas for over seven bucks in America. When you add transport costs (somebody has to pay MY pipeline), liquefaction costs (those plants are expensive), shipping costs (specialized vessels that can only haul LNG), regasification costs (expensive plant on the receiving end) and pipelines for delivery, and the Europeans are paying a hundred bucks for gas that costs seven on our side of the pond.
Even if Europe COULD get enough gas to heat homes and keep factories running, They’re paying TEN times the cost for natural gas, which is also translated to other energy costs as natural gas is a preferred fuel for electricity and heat and in many cases, feedstock for chemical production.
They can’t get enough gas. You point to a piece of property next to a suitable deep-water port, and it’s a MINIMUM of four years before you’re unloading ships there. Europe simply does not have enough gasification capacity to receive its necessary supply.
Things are likely to get cold in Europe this winter.
Interesting times, folks.