Sanctions on Russia Will Increase EU Natural Gas Prices to over $47/million Btu, Compared to US at $5/million Btu

EXCERPT from:

THE UKRAINE PLOT IS THICKENING WITH GERMANY AND FRANCE NO LONGER IN LOCKSTEP WITH US/UK-LED NATO

https://www.windtaskforce.org/profiles/blogs/the-plot-is-thickening...

It would be better to allocate resources to become much more energy and resource efficient, and as a result use less energy and resources, and as a result have less CO2 emissions and other emissions relating to energy and digging up resources.

However, certain folks in the US government are not so interested in the environment.

Russia-hating, extremists in the US State Department and US Congress have been using NATO to pressure first the USSR, then Russia.
 
They have been deluding impoverished, corrupt Ukraine with future membership in the EU and NATO, since 1990
They have been weaponizing Ukraine since the US-instigated Color Revolution/coup d’etat in 2014
Millions of Russian-speaking Ukrainians, mostly in East Ukraine, decided not to support the Kiev government.
The US instigated Ukraine not to implement the Minsk 2 agreements, to keep the pot boiling
 
The US and UK supplied huge quantities of defensive and offensive weapons, plus military training personnel to Ukraine, so it could “defend itself”
 
Russia made certain demands regarding:
 
1) NATO encroachments beyond East Germany starting in 1997 (after pledging not to do so in 1990)
2) The indivisibility of Russian and European security.
 
The US/UK-led NATO rejected the demands, and offered to talk about important, albeit peripheral issues.
 
Ukraine hot-heads floated the idea of Ukraine having an “Iron Dome” similar to Israel, and reacquiring nuclear weapons
Russia finally reacted. The result is a shooting war in Ukraine.
 
The EU is partially at fault, as it did not assert itself regarding the Kiev coup d’etat in 2014
The EU decided to become an aider and abettor of US policy goals regarding Ukraine in 2014, and onwards
The EU ended up being maneuvered into its present predicament, which is at variance with EU vital interests.

World LNG Market

 

LNG is made by cooling natural gas to minus 260F, which reduces its volume by a factor of about 600    

Natural gas is piped to a port, processed, liquified, and loaded onto LNG carriers for shipment by sea.

 

To receive LNG, a receiving port must have a gasification plant to convert the LNG to gas, to send it by pipeline to end users.

Liquefaction and gasification plants cost billions of dollars and take multiple years to build.

Europe has 29 gasification plants.

 

Many of the world’s top suppliers are maxed-out, with little capacity to produce and liquefy more gas than they are already moving.

 

About two-thirds of all LNG is sold under firm-price, long-term contracts, with fixed destinations.

Some major contract holders, such as South Korea, Japan and China, could redirect some cargoes to Europe, if a cutback in Russian exports creates a worsening supply crisis.

https://www.youtube.com/embed/4jGrXsE6YqQ?wmode=transparent&sta...

Dubai LNG Supply to EU: The reason behind the Western incursion into Syria and Qatar-funded attempts at revolution, had nothing to do with installing a democratic government, but with removing Assad's pro-Russia government, so that Qatar could safely pass a pipeline through Syrian territory, which would then proceed to the EU. Putin’s support of Assad successfully quashed the pipeline.

 

Which means any Qatar gas sent to the EU would be LNG, carried by LNG carriers, which are in short supply.

Qatar is getting cold feet about the LNG-to-EU strategy.

Qatar energy minister Saad al Kaabi said most of our LNG exports are tied to long-term contracts.

Russia Pipeline Gas Supply to Europe

 

Fossil fuel provides about 70% of Europe’s primary energy

Natural gas provides about 20%; of that about 20% for electric power generation, the rest for heating and industrial processes.

 

Russia provided Europe and Turkey with 200.8 and 198.97 billion cubic meters of gas (bcm), in 2018 and 2019, respectively;

Russia provided 174.9 bcm in 2020, because COVID reduced economic activity.

Russia provides about 40% of annual EU gas requirements. See Note

Other gas suppliers are: Norway 22%, Algeria 18%, Azerbaijan 9%

Germany, Italy and Turkey received 45.84, 20.80, 16.40 bcm, respectively, in 2020. See URL

http://www.gazpromexport.ru/en/statistics/

 

LNG from Elsewhere Replacing Russian Gas

 

In case of no gas flow from Russia, 200 bcm/y, Europe would have a 40% shortfall, of which about 10% to 15%, or 20 bcm/y to 30 bcm/y, could be offset by diverting LNG from other sources; gas and other spot prices would be at new highs.

 

NOTE: In 2020, Russia provided the following percentage of gas to Europe, by country:

* Members of the EU.

 

Bosnia + Herzegovina 100%, N. Macedonia 100%, Moldova 100%, *Finland 94%, *Latvia 93%, Serbia 89%, *Estonia 79%, *Bulgaria 77%, *Slovakia 70%, Croatia 68%, *Czechia (Czech Republic) 66%, *Austria 64%, *Greece 51%, *Germany 49%, *Italy 46%, *Lithuania 41%, *Poland 40%, *Slovenia 40%, *France 24%, *Netherlands 11%, *Romania 10%, Georgia 6%.

https://www.statista.com/statistics/russian-gas-dependence-in-europ...

 

 

 

High-Priced LNG Would Make Europe Less Competitive

 

Due to increased EU energy and electricity costs, a Mercedes, or Audie, or Volkswagen, or anything else made in Europe, could suddenly become up to 50% more costly.

 

That condition would be in place for up to 10 years, because it would take that long to build up additional:

 

- Gas production capacity, elsewhere in the world, to replace Russia’s 200 bcm/y of pipeline gas.

- LNG production plants and sending ports

- LNG carriers; average capacity 170,000 cubic meter of LNG

- LNG receiving ports and gasification plants

- Connections to existing onshore pipe systems, all while:

 

1) EU inflation would be off-the-charts

2) EU exports would dwindle.

 

NOTE: The above production and infrastructure build-ups would be in addition to what is required for projected LNG world market growth

 

US Search for 200 bcm/y of Natural Gas Elsewhere

 

If Russian pipeline gas supply to the EU were interrupted, adequate quantities of gas would need to be found elsewhere.

 

The US stated, it is putting together a "global strategy" to increase gas production among allies, in case of a Russian invasion of Ukraine.

 

"The State Department, led by Senior Adviser for Energy Security Amos Hochstein, has in the last six to eight weeks been putting together a global strategy exploring contingency options to redirect and increase gas supplies from different parts of the world, a senior US official said," CNN reports Sunday. “This has included talks with firms in Europe, the Middle East, North Africa and Asia”.

 

The next section shows how unlikely would be this “global strategy”

 

Up to 40% Additional LNG Carrier Loads, if Russian Pipeline Gas Supply to Europe were Stopped 

 

Brussels wind/solar bureaucrats make the same mistakes as Washington wind/solar bureaucrats

 

The only beneficiaries are multi-billion companies that supply the wind and solar systems, and Utilities, that sell much more high-priced electricity due to implementing the "electrify everything" mantra

 

Everyone else gets screwed with higher taxes, fees and surcharges, and higher household electric rates, as happened in Denmark and Germany.

 

Those people are told to grin-and-bear-it/sacrifice, because they are “fighting” climate change, a la Don-Quixote tilting at wind mills, while the RE subsidy-collecting elites cruise around in private jets and yachts.

 

Historically, the EU has imported very minor quantities of LNG, because LNG prices are about 25 - 30% higher than pipeline gas bought from Russia, under long-term contracts.

That will always be the case, due to cost differences of applicable technologies.

 

Brussels RE bureaucrats, likely with little hands-on experience in the energy sector, have urged EU countries not to sign long-term gas supply contracts with Russia, because that would send the wrong “virtue signal” regarding “weaning the EU off fossil fuels”. Just google, if you find this incredible.

 

As a result of Brussels RE bureaucrat myopic decisions, EU spot prices for gas have become “volatile”, i.e., about 5 to 10 times long-term prices

 

Russia made sure to reliably provide pipeline gas, to clients with signed long-term contracts, as confirmed by Brussels, Germany, Turkey, etc.

Russia has no contractual obligation to supply gas to the EU spot market.

Russia has no contractual obligations to fill the EU above- and belowground gas storage reservoirs

This was known by Brussels RE bureaucrats, prior to their myopic decisions.

 

Calculation of Additional LNG Carrier Loads

 

Assume an average LNG carrier capacity at 170,000 m3, equivalent to 76,500 metric ton of LNG

In 2020, world LNG demand was 360 million metric ton, equivalent to 4,706 LNG carrier loads/y. See URL

The 200 bcm/y of pipeline gas supply from Russia is equivalent to 1903 LNG carrier loads/y

 

There would need to be an enormous, worldwide increase in LNG carrier loads of about (4706 + 1903)/4706 = 40.4%, if Russian gas to the EU were stopped. See table

 

There would be a gigantic, additional strain on the world’s LNG system, which would send spot prices to unprecedented levels for many years.

At present, Europe lacks the capacity to receive and gasify that many carrier loads.

At present, there is a significant shortage of large-capacity LNG carriers

 

NOTE:

https://www.rivieramm.com/opinion/opinion/lng-shipping-by-numbers-3...

https://www.shell.com/energy-and-innovation/natural-gas/liquefied-n...

 

Russian gas supply

 

billion m3/y

200

Carrier load, LNG

 

m3

170000

gal/m3, conversion factor

 

264.172

Carrier load, LNG

170000 x 264.172

gal

44909240

gal LNG/million Btu

 

12.1

Carrier load

449092240 x (10^6/12.1)

million Btu

3711507

Btu/cf, gas

 

1000

cf/m3, conversion factor

 

35.315

Btu/m3, gas

 

35315

Carrier load

3711507 x 10^6/35315

million m3

105

Carrier load

 

billion m3

0.105

Carrier loads/y

200 bcm/y/0.105

1903

Carrier loads/week

 

 

38

 

German Energy Sector, ENERGIEWENDE, and Global Competitiveness

 

Germany is currently buying pipeline gas from Russia, under long-term contracts, at about $280 per 1000 cubic meter, or $7.93/million Btu. For comparison, US long-term pipeline gas prices for new contracts are about $5/million Btu

Germany would be buying LNG gas, for many years, at spot prices of up to $1500 per 1000 cubic meter, or $42.47/million Btu

https://www.reuters.com/business/energy/russian-gas-flows-germany-v...

 

There is no way Germany could shut down coal and nuclear plants, and have more wind and solar, as part of its multi-decade ENERGIEWENDE, without having much more low-cost pipeline gas from Russia

 

The additional gas is planned to arrive, via the completed Nordstream 2 pipeline under the Baltic Sea, from Russia to Germany.

 

Germany would have to buy very large quantities of LNG, at very high spot prices, from whatever unstable countries.

 

That cost adder would totally ruin Germany's world competitiveness, and very large annual trade surpluses.

The ENERGIEWENDE, and fighting climate change, would have to be on the back burner for up to 10 years. 

 

NOTE: 1000 m3 contains 1000 x 35.315 ft3/m3 x 1000 Btu/ft3 = 35,315,000 Btu

 

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Comment by Willem Post on February 25, 2022 at 11:19am

Jon Boone <jon@jbboone.net>

To: VERONICA METCALFE, Sherri Lange

Fri, Feb 25 at 9:27 AM

 

On the heels of my comments on the Ukraine issue, Willem Post this morning sent me this extremely perceptive article about it.

 

Nice to be reminded of Mackinder’s Heartland thesis, which I first encountered as a college sophomore. Hope this will add to your understanding.

 

The other thing to mention is, since the end of World War II, Western Europe’s military power has, de facto, been that of the United States.

 

Although each nation has a token military presence, it is dwarfed by the US military juggernaut.

 

One of the primary consequences of this has been European nations have only spent about 1% of their GDP on their military, allowing them the latitude to fund:

 

1) R&D in consumer products, cars, appliances, etc., and export high-quality, desirable products all over the world.

 

2) The myriad social services, such as nearly free higher education and low-cost universal healthcare, western Europe has been known for.

 

About one third of the US budget has been allocated to military spending (often more), leaving much less nearly-free higher education and for “social safety nets.”

All of this has had political and social consequences in the US that are now coming home to roost.



Comment by Willem Post on February 24, 2022 at 6:14am

Think,

I saw that.

USPS says screw you Biden.

If you want RELIABLE mail delivery, we will NOT be using EV tricky trucks, that have MUCH GREATER OWNING AND OPERATING COSTS THAN EQUIVALENT GASOLINE VEHICLES.

THE SAME IS TRUE FOR EV CARS AND EV TRANSIT AND SCHOOL BUSES

https://www.windtaskforce.org/profiles/blogs/electric-bus-systems-l...

https://www.windtaskforce.org/profiles/blogs/poor-economics-of-elec...

http://www.windtaskforce.org/profiles/blogs/electric-vehicles-compa...

http://www.windtaskforce.org/profiles/blogs/vermont-co2-reduction-o...

http://www.windtaskforce.org/profiles/blogs/the-proper-basis-for-ca...

Comment by Thinklike A. Mountain on February 23, 2022 at 11:42pm

USPS Shuns Biden's EV Dreams With Massive Gasoline-Powered Mail Truck Purchase
https://www.zerohedge.com/markets/usps-shuns-bidens-ev-dreams-massi...

 

Maine as Third World Country:

CMP Transmission Rate Skyrockets 19.6% Due to Wind Power

 

Click here to read how the Maine ratepayer has been sold down the river by the Angus King cabal.

Maine Center For Public Interest Reporting – Three Part Series: A CRITICAL LOOK AT MAINE’S WIND ACT

******** IF LINKS BELOW DON'T WORK, GOOGLE THEM*********

(excerpts) From Part 1 – On Maine’s Wind Law “Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine if the law’s goals were met." . – Maine Center for Public Interest Reporting, August 2010 https://www.pinetreewatchdog.org/wind-power-bandwagon-hits-bumps-in-the-road-3/From Part 2 – On Wind and Oil Yet using wind energy doesn’t lower dependence on imported foreign oil. That’s because the majority of imported oil in Maine is used for heating and transportation. And switching our dependence from foreign oil to Maine-produced electricity isn’t likely to happen very soon, says Bartlett. “Right now, people can’t switch to electric cars and heating – if they did, we’d be in trouble.” So was one of the fundamental premises of the task force false, or at least misleading?" https://www.pinetreewatchdog.org/wind-swept-task-force-set-the-rules/From Part 3 – On Wind-Required New Transmission Lines Finally, the building of enormous, high-voltage transmission lines that the regional electricity system operator says are required to move substantial amounts of wind power to markets south of Maine was never even discussed by the task force – an omission that Mills said will come to haunt the state.“If you try to put 2,500 or 3,000 megawatts in northern or eastern Maine – oh, my god, try to build the transmission!” said Mills. “It’s not just the towers, it’s the lines – that’s when I begin to think that the goal is a little farfetched.” https://www.pinetreewatchdog.org/flaws-in-bill-like-skating-with-dull-skates/

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Sign up today and lend your voice and presence to the steadily rising tide that will soon sweep the scourge of useless and wretched turbines from our beloved Maine countryside. For many of us, our little pieces of paradise have been hard won. Did the carpetbaggers think they could simply steal them from us?

We have the facts on our side. We have the truth on our side. All we need now is YOU.

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Hannah Pingree on the Maine expedited wind law

Hannah Pingree - Director of Maine's Office of Innovation and the Future

"Once the committee passed the wind energy bill on to the full House and Senate, lawmakers there didn’t even debate it. They passed it unanimously and with no discussion. House Majority Leader Hannah Pingree, a Democrat from North Haven, says legislators probably didn’t know how many turbines would be constructed in Maine."

https://pinetreewatch.org/wind-power-bandwagon-hits-bumps-in-the-road-3/

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