Showing posts with label natural gas. Show all posts
Showing posts with label natural gas. Show all posts

Friday, 6 June 2014

Further proof that Vladimir Putin's China gas deal is an expensive failure

Vladimir Putin's much lauded China gas deal is nothing but a huge failure, as I pointed out right after the signing.

I'm pleased to note the Royal Institute of International Affairs agrees:

The $400 billion natural gas deal Gazprom signed with China National Petroleum Corp. last month strongly favors the Chinese company and its country, writes an analyst with Chatham House, the Royal Institute of International Affairs, London (OGJ Online, May 21, 2014).
“At best, the contract with China will barely allow Gazprom to cover costs,” writes Ilya Zaslavskiy, Robert Bosch fellow in the think tank’s Russia and Eurasia Program. “At worst, it could expose its monopoly and result in huge losses.”
Gazprom is to supply 38 billion cu m/year of gas under the 30-year deal at an average price, confirmed by Russian Energy Minister Alexander Novak, of $350/thousand cu m (Mcm), Zaslavskiy reports. Links to the price of oil remain vague.
Undisclosed take-or-pay requirements and future price negotiations probably are less favorable to Gazprom than those features of the Russian company’s contracts with European customers, the analyst says. CNPC had the stronger bargaining position because of its alternative gas supplies from Central Asia, Myanmar, LNG, and domestic resources of gas and coal.
Zaslavskiy estimates Gazprom’s direct expenses on production, processing, and transit might exceed $300/Mcm.
That total includes $100/Mcm for development of Chayanda and Kovytka fields in eastern Siberia. Costs related to transportation and processing—including construction of the Power of Siberia pipeline, expansion of the Sakhalin-Khabarovsk-Vladivostok pipeline, and construction of a processing plant and petrochemical facility in Belogorsk—will be at least $150-200/Mcm, the analyst says.
Russian President Vladimir Putin suspended the mineral extraction tax in a move that will lower government receipts by $30 billion over the life of the contract.
“The real winner,” writes Zaslavskiy, is China.

It is sad to see how the failed dictator Putin is wasting enormous sums of money (that would be needed to improve the crumbling Russian economy) on this entirely political deal.

Thursday, 22 May 2014

Reuters praises Putin's disastrous China deal

Reuters is doing a great job as Vladimir Putin's PR agency:

China and Russia signed a $400-billion gas supply deal on Wednesday, securing the world's top energy user a major source of cleaner fuel and opening up a new market for Moscow as it risks losing European customers over the Ukraine crisis.
The long-awaited agreement is a political triumph for Russian President Vladimir Putin, who is courting partners in Asia as those in Europe and the United States seek to isolate him over Moscow's annexation of Ukraine's Crimea peninsula.

The China deal is in reality a result of Chinese extortion in a situation where the Russian dictator was forced to make a deal which in the end will be highly unprofitable for the Russians. Gazprom - the pipe laying company - will have to invest a huge amount of money in new pipelines, which most likely never will be profitable. And the Chinese will be able to demand even lower prices, whenever the situation in the world gas markets change.

This deal is far from the "triumph" described by Reuters. It is a political deal, which in the end will lead to an even more weakened Russia.

Tuesday, 17 September 2013

New peer reviewed study: Methane leaks from natural-gas drilling sites much smaller than previously thought

Great news from the University of Texas. The anti-fracking lobby cannot use methane leaking in their propaganda anymore:

Natural-gas drilling sites aren't leaking as much methane into the atmosphere as the federal government and critics of hydraulic fracturing had believed, according to the first study of emissions at multiple drilling sites.

The study, led by researchers at the University of Texas at Austin and published on Monday by the Proceedings of the National Academy of Sciences, is likely to ease some concerns about the impact of natural-gas extraction on the climate.

Measuring emissions at 190 sites, the study found less "fugitive methane" than previous work by the Environmental Protection Agency and some university researchers, which relied on estimates. Methane, the primary ingredient in natural gas, is a potent greenhouse gas.

Critics of fracking have contended that large amounts of methane leak from gas drilling sites, with some suggesting the problem was so great that it would be better for the environment to burn coal instead of natural gas.

Read the entire article here

Thursday, 11 July 2013

Gone are the "good old days": Gazprom not anymore able to dictate prices to its European customers

Russia's Gazprom is more and more looking like a giant with feet of clay. No longer (fortunately) is Putin's money machine able to dictate gas prices to its European customers, as it used to do in the "good old days": 

In a landmark case, German energy company RWE has won the rights to amends its contracts with Gazprom, Russia’s state-owned gas exporter which has refused to budge on pricing for 40 years.
Gazprom CEO Aleksandr Medvedev said on Tuesday that the Moscow-based company will amend its contract with Germany’s second largest utility provider as well as adjust the gas pricing formula.

"We'll do this within a month. We are interested in doing this quicker because amendments will be made before final documents are signed," Medvedev said in Gazprom’s first public comment since the arbitration ruling.
Gazprom’s sudden change of heart on pricing follows a tribunal ruling last Thursday that RWE had overpaid Gazprom for spot marking prices, which forced the Dusseldorf-based company to slash over 11,000 jobs and sent profits plummeting as they lost money on consumer sales.

"It is another sign that the balance of power between Gazprom and its consumers is shifting in favor of the consumers and Gazprom is not ready for that," UBS analyst Konstantin Cherepanov said, Reuters reported.

Germany’s RWE won $1.3 billion (1 billion euros) in compensation in the dispute over pricing for long-term gas-supply against Gazprom, which now has to make retroactive payments dating back to May 2010.

At its annual shareholder meeting, Gazprom announced it has reserved approximately $6 billion (200 billion roubles) to pay off this years’ rebates. 
Read the entire article here

Wednesday, 13 March 2013

The world's most powerful navy fighting a non-existent "threat" with useless biofuel powered "Great Green Fleet"

It appears that the U.S. Navy has become one of the last strongholds for the global warming religion. The latest testimony to that is an interview in which admiral Samuel J. Locklear III, commander of the U.S. Pacific Command, speaks about "the disappearance of whole countries", "hundreds of thousands or millions of people displaced" and climate change as the greatest threat in the region:

Locklear spoke to the Boston Globe on the topic after spending two days in the Boston-area talking to scholars and foreign policy experts on the situation in the Pacific. As Locklear told the Globe, the changing climate “is probably the most likely thing that is going to happen . . . that will cripple the security environment, probably more likely than the other scenarios we all often talk about.’’
Among the issues that the Admiral cited as most concerning was the possibility that rising sea-levels result in the disappearance of whole countries, producing influxes of “climate refugees” in neighboring states. The certainty that climate change is a phenomenon to be dealt with has affected the way that the Navy interacts with the various countries in the Indo-Pacific region that will be affected by shifting weather patterns:
“We have interjected into our multilateral dialogue – even with China and India – the imperative to kind of get military capabilities aligned [for] when the effects of climate change start to impact these massive populations,” he said.“If it goes bad, you could have hundreds of thousands or millions of people displaced and then security will start to crumble pretty quickly.’’
The Navy has been at the forefront of attempting to shift U.S. policy on climate change through the influence wielded by the military. Secretary of the Navy Ray Mabus in 2009 announced the development of a “Great Green Fleet,” a Carrier Strike Group fueled by energy sources other than oil, as part of a strategy to reduce the Navy’s dependence on foreign oil. While currently more expensive, the Navy’s buying power would be able to bring down biofuel prices as supply catches up with demand. Mabus’ program was nearly shut down by Congress, but was revivedby the Senate in November.
Read the entire article here
Recently vice admiral Philip Hart Cullom, Deputy Chief of Naval Operations for Fleet Readiness and Logistics, spoke about the Navy's biofuel projects:
“Advanced 2nd and 3rd generation alternative fuels, such as those we are experimenting with during RIMPAC, will allow us to continue to perform our mission in a manner that frees us from relying upon a diminishing resource. As with the development of any new technology or product, up-front research and development costs in alternative fuels are a necessary part of getting to a new way to power the Fleet. Technological advances and demand are beginning to drive economies of scale and production quantities that can drive down the costs of alternative fuels.”
Read the entire article here
What we have here is the world's most powerful navy combating a non-existent "threat", with ships driven by the world's most expensive fuels. Besides, the Navy has also completely missed the train - or should we say the boat - with its "strategy to reduce the Navy's dependence on foreign oil". Thanks to the shale gas revolution, the U.S. has more than enough of domestic fuel for at least 100 years for a Navy even twice as large as the present one. Why on earth waste American taxpayers' money on biofuels, which in addition contribute to increasing international food insecurity! Even warmists, like the Guardian's George Monbiot, wonder why "the poor must go hungry just so the rich can drive" (or sail). 

Wednesday, 30 January 2013

The shale gas revolution is creating a new kind of 'peak oil'

The brand new Viking Line cruise ferry Viking Grace is fuelled by liquefied natural gas, meaning that sulphur oxide emissions will be almost zero, and nitrogen oxide emissions will be at least 80 per cent below the International Maritime Organization’s (IMO) current stipulated level. Furthermore, there is a reduction of particulate emissions of more than 90 per cent compared to the emissions from conventional diesel engines, while carbon dioxide emissions are also 20-30 per cent lower


“LNG can provide great advantages for our commercial customers as a future energy solution in transportation”
Marvin Odum,  President of Shell Oil Company 



The fast growing supply of inexpensive and environment-friendly natural gas (including shale gas and LNG) is rapidly creating a new kind of "peak oil". Energy giant BP is predicting that the demand for oil will slow down to just 0,8% a year up to 2030, only half the projected total worldwide energy demand growth rate. And there are experts who think that the switch to plentiful natural gas will cut crude oil's supremacy even more. 

Oil is already being priced out of power generation and industry, and the same is expected to happen in the transport sector: 

Trains, ships, and even aircraft are all potential targets, too. Buses powered by compressed natural gas (CNG) – LNG’s less potent older brother – already ply the streets of Dallas and other cities. Rotterdam and Singapore have both outlined plans to become a hub for LNG-powered shipping.

There’s plenty to aim at here. International shipping and aviation fuel plus road freight will account for about 15 million barrels a day of oil demand by 2035, according to the International Energy Agency (IEA). That is a quarter of the projected 60-million-barrel daily oil-for-transport pot.
LNG-powered ships are already a reality, even though the fleet is modest for now. A report by ship classifiers Det Norske Veritas last year predicted that 30 per cent of new vessels will be LNG-powered by 2020. Tankers that carry LNG are an obvious early target. Another classifier, Lloyd’s Register, said the use of LNG as a fuel will pick up from 2019 and could be as much as 8 per cent of global bunker fuel demand before 2025.
Airlines have yet to crack the LNG nut, but the first commercial gas-powered civil aircraft flight left Doha for London on Jan. 9 this year, fuelled by another potential gas-to-transport game-changer – jet fuel made from gas.
Read the  entire article here

Sunday, 27 January 2013

The shale gas difference: US consumer price for electricity only about a third of the price in Germany


"The average American pays about 9 eurocents per kilowatt hour for electricity; the average German household price currently is 26 cents per kilowatt hour and rising."
Philip D. Murphy, US ambassador

On January 23 Philip D. Murphy, US ambassador to Germany, gave a speech on the American shale gas revolution, which hopefully will be read by German environment minister Peter Altmaier as well as other top Berlin decision makers. 
Altmaier, who was interviewed today on German television today, was clearly not well informed about the game changing shale gas revolution and its repercussions in the US and the world. 
Here are some of the points made by ambassador Murphy:
When businesses and consumers pay lower electricity rates, they have more money to spend on other things, besides keeping the lights on.  This contributes to growing consumption and investment.  The average American pays about 9 eurocents per kilowatt hour for electricity; the average German household price currently is 26 cents per kilowatt hour and rising.  Both the International Energy Agency and the Bundesverband der Deutschen Industrie have noted that low U.S. gas and energy prices are giving American industry a competitive edge.  Low energy prices have led to a “re-industrialization” as manufacturers are investing hundreds of billions of dollars in U.S. chemical, fertilizer, steel, aluminum, tire and plastics plants and exports of these goods are surging.
One of the most astounding outcomes of the abundance of natural gas in the US is an unprecedented reduction in carbon dioxide and other particulate emissions.  There are 50 million more American energy consumers today than there were 20 years ago, yet U.S. emissions today are back to the levels of 1992, the year of the Rio Earth Summit and the first Handelsblatt Energy Forum. -
What is truly stunning is the International Energy Agency’s prediction that the United States will be a net oil exporter by 2030.  Reversing the traditional pattern of U.S. energy trade will improve the U.S. trade deficit—oil and gas exports could reduce our current account deficit by 60 percent by 2020, according to a recent study.  The same study estimated that adding U.S. oil exports to global markets, combined with reduced U.S. oil consumption because of higher vehicle fuel efficiency standards instituted by the Obama administration, should reduce global oil prices by 14 to 16 percent. -
Many people have seen internet videos of tap water “catching fire.”  It turns out that that in every documented case, this wasn’t caused by fracking, but by residents accidently drilling water wells into naturally-occurring methane reservoirs.  In some rare instances, faulty well sealing – not fracking – led to methane migration, reinforcing the need for the kind of “best practices” that Energy Secretary Chu’s team came up with.  Transparency builds trust; and the committee also recommended full disclosure of fracking fluid chemicals, which companies are doing on the www.FracFocus.org website.  Obviously, extracting methane is the purpose of drilling for natural gas, so the firms involved have every incentive to minimize and eliminate losses.  But the bottom line is that tens of thousands of wells have been safely drilled and thousands of fracking operations are being conducted in the United States under federal and state regulations that provide strong protection for individuals and the environment.
(text boldened by NNoN)
Germans, as well as other Europeans should look at the facts, not at the lies and propaganda produced by the US and international anti-fracking lobby!  

Sunday, 23 December 2012

New US study: Natural gas-fired energy generation three times cheaper than wind energy

On January 1, US consumers/taxpayers have a big reason to celebrate - the federal production tax credit on wind investment expires: 

For the past 20 years the credit has offset about 30% of the cost of building wind turbines. Add to that the “renewable portfolio standards” for green energy mandated by 29 states, and as a result we’ve seen wind farms spring up across the country. Since 2007 nearly 40% of all the new electricity capacity built in this country has been wind. Wind now generates roughly 3.5% of U.S. electricity.
Don’t expect wind’s share to climb beyond that level any time soon. The end of the tax credit could very well mean the end of the wind industry.

Read the entire article here

The greenies and the wind energy lobby are of course whining, but an end of an industry, which is totally dependent on government (taxpayer) subsidies would be more than welcome in a country, where there is an abundance of clean and cheap natural gas (mainly shale gas) for energy production - and increasingly also as fuel for trucks and cars. 

The real productions costs for wind energy are about three times higher than the costs for natural gas-fired energy, according to a new report by the American Tradition Institute:

new report by the American Tradition Institute (ATI) finds that the full cost of wind electricity is nearly twice what has typically been reported, once hidden costs and subsidies are taken into account. The report, “The Hidden Costs of Wind Electricity,” provides an analysis of three major costs that past estimates have ignored.
“The costs that have been left out of previous reports are the costs of paying for the fossil-fired plants that must balance wind’s variations, the inefficiencies that wind imposes on those plants, and the cost of longer-distance transmission,” said George Taylor, Senior Fellow in Energy Policy at ATI and lead author of the study.  “Once these hidden costs are included and subsidies are excluded, wind generation is not close to being competitive with conventional generation sources such as natural gas, coal or nuclear.”
Using conservative estimates for these real but hidden costs and adding them to the Energy Information Administration (EIA)’s and the Office of Energy Efficiency and Renewable Energy’s most recent generation-cost reports nearly doubles wind’s projected cost – from 8 cents per kilowatt-hour without them to 15 cents per kWh with them.
That 15 cents/kWh is triple the current cost of natural gas-fired generation and 40 to 50% higher than EIA’s estimates for the cost of new nuclear or coal-fired generation.
“Because wind is an intermittent source of electricity, it needs appropriate amounts of fossil-fueled capacity ready at all times to balance its large and rapid variations,” said Tom Tanton, Director of Science & Technology Assessment at ATI and a co-author of the report. “Those primary fossil plants then operate less efficiently than if they were running full-time without wind, meaning that any savings of gas and coal or any reductions in emissions are much less than simple calculations would indicate.”

Wednesday, 12 December 2012

The truth about Gazprom - "the world's most profitable energy company"

“The joke in my office is that they’re going to build a pipeline to the moon. There’s no telling when Gazprom will get over the hump on big ticket projects because they never end."
Michael O’Flynn, managing director, UFG Asset Management.

Bloomberg reports on Gazprom:

The world’s most profitable energy company is being punished by investors who are concerned it’s also the biggest spendthrift.

OAO Gazprom (OGZD)Russia’s natural-gas export monopoly, will beat Exxon Mobil Corp. (XOM) to earn $37.9 billion in 2012, according to estimates compiled by Bloomberg. Yet its shares have fallen 14 percent this year as the state-run company uses its cash to finance the industry’s largest capital expenditure program, including an export terminal in the Far East and undersea pipelines to Europe, where demand is forecast to drop.

The forecasts haven’t reassured investors: Gazprom’s price- to-earnings ratio is the lowest among the world’s 300 biggest oil and gas producers by market value, according to Bloomberg data. The company paid just 7 percent of profit as dividends last year, based on international accounting standards. That compares with 23 percent at Exxon and 45 percent at PetroChina.

The fact that western investors stay away from dictator Putin's pipe laying gas company Gazprom is, of course, nothing new. But what is amazing, is that renowned business media - Bloomberg among them - continue to describe Gazprom as "the world's most profitable energy company". They should know better:


Curiously, in 2011 Gazprom was formally the most profitable company in the world with purported net profits of $46bn, but these profits were hardly real. Investment analysts opined that no less than $40bn disappeared through inefficiency or corruption. Gazprom’s cash flow was barely positive.
In their 2010 booklet Putin and Gazprom , Boris Nemtsov and Vladimir Milov, the opposition politicians, detailed how assets were being stripped from Gazprom through large kickbacks on pipeline construction and cheap sales of financial and media subsidiaries to Putin cronies. Since shareholders have realised that only their dividend yield is material, Gazprom’s market value has plummeted by two-thirds from $365bn in May 2008 to $120bn today.


Yes, there it is - the secret behind Gazprom's pipe laying "strategy".

Monday, 12 November 2012

IEA: U.S. to overtake Russia as biggest natural gas producer already in 2015

The International Energy Agency, which is supposed work for ensuring "reliable, affordable and clean energy for its 28 member countries and beyond", has for years now been a leading force in the international climate change propaganda machine:

However, the IEA now seems - at least temporarily - to have returned to its original task.The newly published World Energy Outlook shows that some people within the IEA understand the importance of the US-led shale gas and oil revolution. At a press conference in London even the IEA's warmist Chief Economist Fatih Birol had to admit that the United States will overtake Russia as the biggest gas producer by a significant margin already by 2015. And according to Birol the U.S. will become the world's largest oil producer only two years later. 
This is what the IEA says in its press WEO press release:
The global energy map is changing in dramatic fashion, the International Energy Agency said as it launched the 2012 edition of the World Energy Outlook (WEO). The Agency's flagship publication, released today in London, said these changes will recast expectations about the role of different countries, regions and fuels in the global energy system over the coming decades.
“North America is at the forefront of a sweeping transformation in oil and gas production that will affect all regions of the world, yet the potential also exists for a similarly transformative shift in global energy efficiency,” said IEA Executive Director Maria van der Hoeven. “This year’s World Energy Outlook shows that by 2035, we can achieve energy savings equivalent to nearly a fifth of global demand in 2010. In other words, energy efficiency is just as important as unconstrained energy supply, and increased action on efficiency can serve as a unifying energy policy that brings multiple benefits.”
The WEO finds that the extraordinary growth in oil and natural gas output in the United States will mean a sea-change in global energy flows. In the New Policies Scenario, the WEO’s central scenario, the United States becomes a net exporter of natural gas by 2020 and is almost self-sufficient in energy, in net terms, by 2035. North America emerges as a net oil exporter, accelerating the switch in direction of international oil trade, with almost 90% of Middle Eastern oil exports being drawn to Asia by 2035. Links between regional gas markets will strengthen as liquefied natural gas trade becomes more flexible and contract terms evolve. While regional dynamics change, global energy demand will push ever higher, growing by more than one-third to 2035. China, India and the Middle East account for 60% of the growth; demand barely rises in the OECD, but there is a pronounced shift towards gas and renewables.
Fossil fuels will remain dominant in the global energy mix, supported by subsidies that, in 2011, jumped by almost 30% to $523 billion, due mainly to increases in the Middle East and North Africa. Global oil demand grows by 7 mb/d to 2020 and exceeds 99 mb/d in 2035, by which time oil prices reach $125/barrel in real terms (over $215/barrel in nominal terms). A surge in unconventional and deepwater oil boosts non-OPEC supply over the current decade, but the world relies increasingly on OPEC after 2020. Iraq accounts for 45% of the growth in global oil production to 2035 and becomes the second-largest global oil exporter, overtaking Russia.
While the regional picture for natural gas varies, the global outlook over the coming decades looks to be bright, as demand increases by 50% to 5 trillion cubic metres in 2035. Nearly half of the increase in production to 2035 is from unconventional gas, with most of this coming from the United States, Australia and China. Whether demand for coal carries on rising strongly or changes course radically will depend on the strength of policy decisions around lower-emissions energy sources and changes in the price of coal relative to natural gas. In the New Policies Scenario, global coal demand increases by 21% and is heavily focused in China and India.
So far, so good, but where the warmist IEA errs, is in its projections for renewable energy:
Renewables become the world’s second-largest source of power generation by 2015 and close in on coal as the primary source by 2035. However, this rapid increase hinges critically on continued subsidies. In 2011, these subsidies (including for biofuels) amounted to $88 billion, but over the period to 2035 need to amount to $4.8 trillion; over half of this has already been committed to existing projects or is needed to meet 2020 targets.
With more than enough of cheap and clean natural gas and oil on offer, governments will not be  willing to waste huge sums of taxpayers' money on inefficient and expensive wind and solar power. 

Saturday, 20 October 2012

The U.S. should not waste money on ineffective wind energy - There is more than enough of shale gas

The question Americans should now ask themselves: Why waste money and resources on inefficient, expensive, bird and bat killing, landscape destroying wind energy - when there is more than enough of cheap and clean shale gas available? (And solar power is in many ways comparable to wind energy).


There's been plenty of debate over the Marcellus Shale natural gas field, but new research adds a twist that could impact political and environmental battles. Two independent financial firms say the Marcellus isn't just the biggest natural gas field in the country — it's the cheapest place for energy companies to drill.
One of the reports adds that the Marcellus reserves that lie below parts of Pennsylvania, West Virginia, Ohio and New York are far larger than recent government estimates, while another said the powerful combination of resource, cost and location is altering natural gas prices and market trends across the nation.
The Marcellus could contain "almost half of the current proven natural gas reserves in the U.S," a report from Standard & Poor's issued this week said.
Another recent report from ITG Investment Research, a worldwide financial firm based in New York, found that a detailed analysis of Marcellus well production data suggested that federal government estimates of its reserves "are grossly understated," according
The new information increases the likelihood that natural gas will be used for more and more energy needs, such as city buses, industrial use, and electric power generation, according to Manuj Nikhanj, the head of Energy Research at ITG. And though low wholesale prices have squeezed drilling companies' revenue, the S&P report says the Marcellus has the lowest production cost of any natural gas field in the nation, adding to the likelihood of a continued boom.
"The amount of resource that's available at relatively low cost is fairly enormous," Nikhanj said.
The Marcellus is a gas-rich formation thousands of feet below much of the four states, but current production is centered in Pennsylvania and West Virginia.
Earlier this year, the federal Energy Information Administration sharply lowered its estimates of Marcellus reserves, from 410 trillion cubic feet down to 141 trillion cubic feet. That adjustment was widely reported, including by The Associated Press.
But that lowered estimate doesn't correspond with actual well production, said Nikhanj. He said their analysis shows that the Marcellus contains about 330 trillion cubic feet of gas, more than double the size of the next largest field in the nation, the Eagle Ford in south Texas.
Some financial firms and critics of gas drilling had suggested that the EIA estimates supported theories that Marcellus production might decline more rapidly than expected, and thus be far less profitable for energy companies. But Nikhanj said a review of actual Marcellus well data shows that on average they're producing more gas than expected, not less.
Read the entire article here



Monday, 24 September 2012

Toyota scraps all-electric cars

Japan´s Toyota has learnt the lesson: There is no room for all-electric cars in the foreseeable future: 

Toyota Motor Corp has scrapped plans for widespread sales of a new all-electric minicar, saying it had misread the market and the ability of still-emerging battery technology to meet consumer demands.
Toyota, which had already taken a more conservative view of the market for battery-powered cars than rivals General Motors Co and Nissan Motor Co, said it would only sell about 100 battery-powered eQ vehicles in the United States and Japan in an extremely limited release.
The automaker had announced plans to sell several thousand of the vehicles per year when it unveiled the eQ as an pure-electric variant of its iQ minicar in 2010.
"Two years later, there are many difficulties," Takeshi Uchiyamada, Toyota's vice chairman and the engineer who oversees vehicle development, told reporters on Monday.
By dropping plans for a second electric vehicle in its line-up, Toyota cast more doubt on an alternative to the combustion engine that has been both lauded for its oil-saving potential and criticized for its heavy reliance on government subsidies in key markets like the United States.
"The current capabilities of electric vehicles do not meet society's needs, whether it may be the distance the cars can run, or the costs, or how it takes a long time to charge," said, Uchiyamada, who spearheaded Toyota's development of the Prius hybrid in the 1990s.
Read the entire article here
The sooner "Government Motors" (GM) learns the same lesson, the better. Instead both GM, Toyota and other manufacturers should concentrate on developing the only realistic option - cars running on natural gas

Sunday, 16 September 2012

Cars running on natural gas - not electric hybrids - are the future

A Honda Civic running on natural gas

Natural gas vehicles are the future for the auto industry, not the much hyped electric hybrids. The U.S. has more than enough of shale gas for at least 100 years, and there is plenty of it elsewhere in the world, too. The good news is that the gas can also be used as a cheap transportation fuel: 

As America finds more reserves of natural gas, the auto industry is sure to take notice.

Natural gas got a strong vote of confidence as a future vehicle fuel at the Society of Automotive Analysts Strategic Planning Summit in Southfield, Mich. last week.

New methods of extracting the gas are one of the biggest changes affecting the auto industry in years, General Motors chief economist Mustafa Mohatarem said.

"The U. S. now has a 100-year supply of natural gas," he said. "I'd make a bet it's the next big transportation fuel. The price is so much lower than gasoline -- people will find a way to use it."

The idea got a second from John Casesa, senior managing director of investment banking at Guggenheim Partners. "We're also very high on natural gas," he said. "It's a massive change for the United States, and probably a big deal for the motor industry."

Read the entire article here

Natural gas is already a big thing in the commercial truck market. Firms operating big fleets are switching to natural gas vehicles in order to save fuel costs. When car manufacturers are able to offer decently priced passenger cars running on natural gas, they will find buyers, who appreciate the low fuel costs: 

Honda used the cleaner-emissions pitch when its Civic GX came on the U.S. market in 1998, says Brad Johnson, corporate fleet director with Pacific Honda in San Diego. Now, he says, buyers seem more interested in saving at the pump and using a fuel produced in the U.S. Honda is also promoting the fact that CNG vehicles can drive in high-occupancy-vehicle lanes on California freeways.

Even though consumers are slow to adopt natural-gas passenger vehicles, at least a few gas retailers are optimistic that if they build it, drivers will come.

Love's Travel Stops & Country Stores, of Oklahoma City, plans to open 10 retail outlets with CNG pumps this summer, thanks to a partnership with Chesapeake Energy.

And Kwik Trip Inc., an operator of gas stations and convenience stores, opened its first CNG station aimed at passenger-car drivers in La Crosse, Wis., this spring, with plans for several more.

"It's attractive to customers because it's a domestic product, there's a steady supply, and the price is right," says John McHugh, Kwik Trip's communications manager. "If we can offer the consumer a value, we know people will jump on the bandwagon."

Read the entire article here

Tuesday, 7 August 2012

Another benefit of the shale gas revolution: A bright and clean future for shipping


The  M/S Viking Grace - to be delivered in January 2013 from the STX  Finland Turky shipyard - will be the largest passenger ferry to operate on liquefied natural gas (LNG), making it the most environmentally sound and energy efficient large passenger vessel in the industry to date. 

Two years ago, the world´s largest ship engine builder Wärtsilä´s Jaakko Eskola predicted a bright future for gas powered ships: 
The number of ships powered by liquefied natural gas may jump 10-fold within five years as anti-pollution rules force owners to switch to the cleaner- burning fuel, the industry’s biggest engine maker said.
“LNG is the future for shipping,” Jaakko Eskola, head of ship power at Helsinki-based Waertsilae Oyj, said by phone on Nov. 12 from Shanghai. Between 800 and 1,000 vessels may use the fuel by 2015, up from about 100 today, he said.

The recent upsurge in the number of LNG ship projects proves that Eskola was right:
“Increasing focus on LNG as a clean and cost effective ship fuel has brought forward initiatives throughout the shipping industry, preparing the ground for a more rapid introduction of LNG as fuel for ships in all segments,” said Mr. Remi Eriksen, COO of DNV Asia Pacific & Middle East. “We believe 500 LNG fuelled ships will be on order by 2015, several thousands by 2020,” he said.
“From a slow start, the interest in LNG as fuel is now very much on the increase. We see studies and projects initiated among national governments, major ship yards and ship owners. Key players throughout the shipping industry are assessing the benefits and risks of going for LNG fuelled vessels, either as conversions or new buildings. This greater interest is creating a momentum that in itself increases the speed in which LNG will be introduced to all segments of shipping.”
The fast growth of the LNG power sector has surprised analysts
Accelerating growth is what you would expect under these circumstances. What surprised us is the rate,” Tom Campbell, LNG-fuel analyst at Zeus,said. “High oil prices, impending emissions regulations and technical advancements are propelling the market faster than we expected.”
A key factor is International Maritime Organization Tier III emissions standards, which are slated to take effect in 2015-2016. The regulations require operators to reduce sulfur and nitrogen oxide emissions. For existing ships, after-exhaust treatment is proving more popular, but for newbuilds, operators are taking advantage of LNG’s unique properties.
As LNG is better understood, architects are able to design ships specifically for LNG storage and propulsion,” Campbell said. “Firms such as Wärtsilä now offer integrated onboard fuel delivery systems and power units for shipbuilders.
Zeus’ survey finds that LNG usage is growing beyond coastal ferries in Europe and offshore service vessels for the oil and gas industry, to large cruise ferries and container vessels while expanding geographically from Europe to North America and Asia. Currently projects underway in Belgium, Sweden, Finland, South Korea, Singapore, Japan and elsewhere have made efforts to offer LNG bunkering and incentives to support LNG-fueled marine technology.

LNG powered ships should be of particular interest for countries like the US and Canada, with their huge resources of shale gas: 
Taking North America as an example, the US and Canada are replete with very competitively priced gas as a result of its recent discoveries of shale and other unconventional gas. Powering North American fleets of OSVs, regional ferries, fishing boats, Great Lakers and inland waterway vessels with gas makes eminent good sense from a commercial point of view. 

The fast growth of clean gas power in ships is another testimony to the benefits of the shale gas revolution, which is paving the way for great energy solutions for all kinds of future transportation problems. And all this is taking place without any senseless and costly government or EU regulations! 

(image by STX Finland)