Lars Larson on LNG Terminals Terminated

Let’s talk about Liquified Natural Gas.

Tuesday, we spent over an hour just talking about LNG. That’s because there is a brand new report out. The governor of Oregon says this new report says Oregon probably doesn’t need LNG. It certainly doesn’t need an LNG terminal on the Columbia River.

Why? Because the governor says there is a proposed pipeline over the Rocky Mountains. The problem is that pipeline is going to cost $3 billion and nobody has even decided to build it yet. But, they do want to build an LNG terminal on the west coast.

Here’s the reason to be in favor of this. Right now about 1/3 of the people in Oregon use LNG for home heating, for electricity, for water heating, for any of those things. That LNG, liquefied natural gas, costs about $11 per million cubic feet. If you bring it in on the tankers it’s about $3 per million cubic feet.

Can you see the price difference? Can you see the advantage? The price has tripled over the last 5 years and the governor wants it to go up more. We should build the LNG terminal.

“For more Lars click here”

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Posted by at 09:00 | Posted in Measure 37 | 16 Comments |Email This Post Email This Post |Print This Post Print This Post
  • jumpdown

    Price info is wrong!

    Where did you hear that the LNG pricing was going to be less than the price anywhere else in the US?

    Imported LNG might be cheaper today, but tomorrow??? You have to guarantee your sources from some pretty dicey areas of the world. The energy cost of LNG is huge and eventually that will make it even more expensive than domestic production, not less. I would love to see where you got your $3/ cubic ft. numbers.
    Thanks.

    • John in Oregon

      Natural Gas isnt a national market, it depends on pipelines which makes pricing very regional. This is why the east coast market is much higher priced than the west. Which is why the backers of the west pipeline are pulling out and the east pipeline is being built. Yes that’s right the pipeline that Governor K is betting on so he can say we don’t need no stinking gas.

      Yes I guess Australia is a really dicey area of the world. Don’t know quite what to make of that.

      Domestic production, what domestic production? Congress has worked hard to insure there is none.

      This last one I really like. The energy cost of LNG is huge. Let me translate this so a dummy like me can understand.

      It’s better to burn it at the well head as waste because it costs money to transport. Private companies are too stupid to understand that. So the government has to step in to prevent investors from choosing where to invest

  • Rupert in Springfield

    There is probably nothing that better sums up the NIMBY attitude than this issue.

    Oregon has some nitwit plan that mandates something like 25% of our energy needs met by renewable resources in the next decade or so.

    Our brilliant Oregon governor has decided hydro is not renewable, the reason being he is an idiot.

    Natural Gas is pretty clean, natural gas could also be a little more affordable if we actually had some means to bring it in efficiently, like this terminal.

    But, our Governor is against it, the reason still being, he is an idiot.

    Hey Ted, did you ever think about the fact that moving Oregon to renewables, or at least cleaner energy is going to take a little more than dumb looks and good vibes to get accomplished?

    The Solution – Bring Ted to my house. Ill get out the Lego’s and tell him “look Ted, I am actually going to take these Lego’s and build a cube”

    “see how I actually have to pick up the Lego’s Ted?”

    “see how I actually have to snap them together and make a square shape?”

    “ok Ted, now you try talking to the Lego’s, just smile at them, see how they don’t form into a cube Ted”

    “ok Ted, now watch, feel how that Lego really hurts when I throw it at your head? That’s the Lego stick of enlightenment Ted, got it now?”

  • Bob Clark

    I doubt any of the proposed Oregon LNG terminals come to fruition. America has become so prosperous the high pitched voices of a few Not-in-my-backyard folk are allowed to outweigh the abstract, but real, needs of the many.

    It’s not really relevant what the cost of LNG today is or isn’t. LNG prices like oil and natural gas prices go through long cycles of 10 to 20 years historically. If some group of private investors wants to risk their capital converting a closed saw mill site into a site capable of expanding supplies of natural gas, I say more power to them. If LNG prices turn out to uncompetitive for extended periods of time, no LNG is likely to be imported. Finally, the developers seem to be jumping through the necessary environmental hoops to not cause too many externalties from their business.

    Also, consider that even if LNG should come from unfriendly sources like Russia or the Middle East, these supplies will allow us to conserve our own domestic natural gas reserves.

    But while it may be logical to allow an LNG venture, the political realities say these proposed terminals are dead ducks in Oregon.

  • Anonymous

    If Portland doesn’t want it, We sure could use it here in East Oregon

  • John McNary

    Where did you get the information that Oregonians use LNG?

    There is no LNG terminal on the West Coast.

    All of you information is wrong.

    Japan is paying $16 – not $3 – for million feet of LNG. It costs $3 per million feet just to TRANSPORT the LNG, Lars.

    LNG is much more expensive than domestic natural gas.

    Plus, its imported from Russia, Qatar and Iran. Not good for U.S. security.

    Why are you in favor of importing MORE fossil fuels from overseas? Can’t you see what this is doing to our economy, our security, right now?

  • older than dirt

    The LNG pipeline’s proposed were to run through Oregon to the California market. No Oregonian was getting any of the gas. California blocked the terminals proposed so the fight was moved to Oregon where they hoped dummies would allow the pipelines through without a comment. Lars incredible misinformation continues just like Bush and McCain.

  • dean

    According to the Energy Information Administration (a branch of DOE) the US has over 200 trillion cubic feet (TCF) of proven, recoverable natural gas reserves, and this level has not changed in 10 years, meaning new finds have been equal to demand. Most of our proven reserves are in Texas and the Gulf, with a lot also in Wyoming, Colorado, New Mexico, Louisiana, Oklahoma and Alaska.

    Australia does not appear to have all that much to export. They only have between 33-119 TCF. The big exporters are:

    Qatar: 910 TCF
    Iran: 979 TCF
    Russia: 1,600 TCF
    Saudi Arabia: 253 TCF
    UAE: 205-214 TCF
    Nigeria: 184 TCF
    Venezuela: 157 TCF
    Iraq: 111 TCF

    Qatar and Iran have the 2 largest producing gas fields in the world. Canada has been a major producer and our main supplier, but their new finds are not keeping up with production. You can se from these stats why Russia has the EU over a pipeline, so to speak.

    The US uses over 20 TCF per year. Largest consumer nation on earth. Do we need LNG? Eventually yes unless we develop renewable energy and learn to conserve faster than we have so far. Today or tomorrow probably not since we have at least 10 years domestic supply. Whenever we do end up importing it, be prepared to send more of your money to Russia and the Middle East. No way around that outcome once we decide to import.

    • John in Oregon

      Ok Dean.

      *YOU* are right

      *AND*

      The people who are investing their own money to build the plant are *STUPID IGNORANT LIARS.*

      *AND*

      While we are at it don’t quote my own number back to me when you know full well most of those US natural gas reserves are off limits to production.

  • John in Oregon

    Hi Rupert

    I don’t disagree with your comments above but I would like to take a look at something you commented about from a different prospective.

    The Oregon legislature passed and our Governor eagerly signed a law that requires that 25% of every watt of electricity used in Oregon be renewable power from renewable sources. Further, the law declares that all existing power sources are not renewable. The full impact of this law takes effect on January 1, 2025, just 18 years from when it was passed.

    What will it take to get there.

    The current generating capacity of Oregon is 5,335,000 Megawatt hours per month, or 64,020,000 Megawatt hours per year. Allowing for a 10% per decade growth (roughly half the historic growth and less than 1% per year) that’s 77,500,000 Megawatt hours. In 2025 the law requires we have 25% of that power to be from newly constructed renewable resources.

    The twenty five percent required in 2025 is equal to 19,375,000 Megawatt hours per year.

    A 1 Megawatt wind generator will produce roughly 2,600 MwH per year assuming the typical wind availability of 30%.

    To generate the required power we need 19,375,000 Megawatt hours divided by 2,600 MwH or 7452 one Megawatt turbines.

    We also have to consider peek power demand in our calculations. Some times of the day power demand is very high, others very small. If the wind blows when power isnt needed its just wind. A 50% de-rating to handle peek load issues isnt out of line. Remember the usual solution of high cost gas turbines or spot market power is not allowed. This power must be *only* from *new* renewable plants.

    Which means we need 14,900 turbines.

    Be patent I will come to the point in a moment. How much is this going to cost?

    Large turbine costs are quoted around $750 to $2,500 per KW. So lets assume a large scale of magnitude savings which brings this turbine cost down to say $500 per KW

    Since the generators will be spread around Oregon in areas without large power lines there will be additional costs for sub stations, power converters, and transmission lines. This calculates to:

    $500 thousand for hardware and physical installation related costs for 1 MW generators.
    $500 thousand for sub stations, power converters, transmission lines, property and roads.

    That’s $1 million per 1 megawatt generator installed, connected to the grid and ready to run in new areas around Oregon. Note I didn’t include attorneys fees and similar costs. Those kinds of costs just cant be calculated.

    At $1 million per generator that’s a total of just under $15 billion for the new capacity equal to about 3 Bonneville dams. That’s expensive but not hugely out of line compared to the cost of Bonneville dam or Trojan in today’s dollars.

    There is a land cost as well.

    Wind turbines require roughly 0.1 square kilometers of unobstructed land per megawatt of nameplate capacity. For one megawatt turbines that’s 0.1 square kilometer which is equal to 25 acres per turbine. That works out to something like 370 thousand acres. Add another 100 thousand for transmission lines and roads so the total comes to a bit less that a half million acres. Not unmanageable.

    We have 17 years left, we better start now. And to speed things up lets assume that the Oregon Legislature provides state bonds for the capital construction costs. Financing is no longer a problem.

    To speed things further we file with the Breeze County planning commission, FERC, BLM, and Oregon DEQ simultaneously.

    After 3 years the Breeze County planning commission completes its work. 14 years left and the Friends of Breeze County file a law suit because wind generators cause cancer, produce infrasonic sound, and induce epileptic seizures.

    The law suit is stream lined and in only 2 year resolved. However during this time the Nature Husbandry purchased some of the land requiring the planning commission to redo the work, The Oregon Legislature underwrites the added costs and we have 12 years left.

    The Planning commission works quickly with the new plan taking only a year, 11 years left.

    Green Tranquillity files a lawsuit against the US Fish and Wildlife Service demanding the Oregon spotted ant be declared an endangered species. After 5 years and several more court actions the project is cleared to proceed. 6 years left.

    BLM prepares to issue the permits. 1000 Pals of Oregon files a lawsuit that the BLM did not proper consider endangered species habitat. Another 3 years gone and only 3 years left.

    In a radio interview a spokesman for the Environmental law Confederacy admits the lawsuits are weak but says they don’t have to win, all they need do is delay the project.

    And note the things I didn’t include on this list. Like the OSU grad student paper suggesting that wind energy causes Global Warming, or the Sierra Society lobbying the Governor to intervene and stop the project or Western environmental law league initiative petition to protect Oregon windy spaces.

    *And now we get to the point. This is a rationing law. For every missing watt of “natural” power 3 watts of conventional power go off line. Too bad, so sad, enjoy the dark and cold.*

    • dean

      John…funny…witty analysis.

      First…I did not say, assume, or mean to imply that those investing in LNG are ignorant or lying. I assume they have calculated the costs and benefits and have determined it pencils out in their favor. I was only pointing out where the LNG is likely to come from, and it is not Australia (as you sugested)…at least not much of it.

      I don’t “know full well that most US natural gas reserves are off limits to production.” Given where most of the gas is located: Texas, Oklahoma, Louisiana,, etc…I assume the opposite. That most is in accessible locations. The 3 problematic locations are the Rocky Mountain area (though the Bush Administration has been issuing leases left and right in Wyoming,) Alaska, which needs a pipeline, and the Gulf, which is partly developed but may have areas that have problems, like shallow waters off of Florida.

      On wind power, I won’t argue about your numbers, but will take issue with a few points in your story line.

      First…where is there enough consistent wind in Oregon to generate enough power to justify investments using today’s technology?

      Oregon State University (tax supported, public institution by the way) has been setting out portable anemometers around the state since the 1970s, gathering wind data. For the most part we have 3 regions with enough wind to interest investors:

      Columbia plateau (Sherman County area)
      East Columbia Gorge (north Wasco and Hood River Counties)
      Oregon Coast (just about the whole thing)

      There are also off shore possibilities.

      The Columbia plateau area has already atracted a lot of wind investment. There have been virtually no environmental issues (other than mitigation for bird and bat kills, which occur anywhere one would site a turbine). THe BPA power grid is close by, lessening the need for new lines.

      THe east gorge is just now attracting wind investments. Again, the BPA grid is right there for the taking. But there there are serious environmental issues, primarily over aesthetic impacts to the National Scenic Area from hundreds of 400 foot tall (think Big Pink) towers. Nevertheless, Friends of the Columbia Gorge, not exactly a wallflower of an environmental group, have reached an agreement to not challenge one very large project (190 odd turbines on the Washington side) after a settlement on mitigation measures was reached. The availablility of good sites on the Oregon side is limited, but there appear to be a lot of sites from Dallesport to Goldendale available.

      The coast has tons of wind (and waves and tides,) but also tons of scenery and a lack of power lines.

      There are other windy places in Oregon, but not of the extent of these 3 from what I have seen. I’m ruling out the top of Mt Hood, which is quite windy. The west gorge (Troutdale-Gresham,) which seems very windy, is not nearly windy enough. This is true for the entire Willamette Valley as well.

      There are places where wind turbines don’t belong. there are environmental groups who will resist proposals for these areas. But so far, the wind facility siting process appears to be working fairly well. Once we run through the easier sites it will get interesting.

      I did note you left solar out of your story. I think this has better portential than wind for Oregon for many reasons. Also, simply making buildings more energy efficient will do more than anything else to reduce electricity (and natural gas) demand.

    • Rupert in Springfield

      I agree with you. I had no idea the law was written in such a way that all existing power generation methods were declared non renewable. What idiocy!

      With regard to wind power, this is an interesting issue, as it crystallizes the environmental movement in a way like no other. What could be more innocuous than a windmill?

      Well, Ill tell you what. Unbeknownst to you all, my wife is a professional wildlife rehabilitator and a card carrying member of the extreme left save the earth man is evil movement. Yep, I don’t know why, but I have always loved the commie babes. I guess its the weird hair colours and the fact that they put out, who knows.

      Anyway, the basic problem is with windmills, you need a lot of wind, the problem is anywhere you have a lot of wind, without a lot of whiners complaining about ugly windmills tends to be a bird migration area. Windmills are referred to as bird blenders in the wildlife rehab world.

      Second problem with wind – A friend of mine is a crane worker. He unloads ships. A while back he was unloading turbine blades for those windmills. You want to know how much they cost? About 2 million for the set of three he was unloading that day. You want to know something else? These are a balanced set. That means if some seagull flies in and damages one blade, you get to replace all three.

      Ok, so bye bye wind power. The economics just aren’t going to work with those sorts of numbers.

      Hey? What about wave power, I think UO just set up some wave powered thingy off the cost a few months back, that was in the news. My wife seemed pretty hopeful about that.

      “Honey, you know I love you, but please, think a minute, you don’t think the fish guys have a bunch of lawyers out there just itching to shut this down like you guys have the bird lawyers?”

      “Oh yeah, I guess you’re right”

      “Yeah, at the end of the day you cant blame them, I mean its essentially slip and fall work that most ambulance chasers do in the human world, just now its in the animal world as well. Everyone’s gotta make a living, even predators”

      “You know, your sort of a jerk about the wildlife stuff, but sometimes even the jerk stuff is kind of sexy to me”

      • dean

        Rupert…is she an Obama girl? Boy…this explains a lot about you by the way. You must have some interesting dinner table conversations.

        Birds, bats, and wind turbines. I think this is not as big an issue as it once was. Early wind projects, like at Altamont Pass, used trellis style towers that were great perches for raptors who would fly off and get minced up. The new styled towers lack perches. The data I have seen is that as long as major flyways are avoided, bird kills from turbines are pretty low…lower than what a stealthy backyard cat takes in a given year.

        But the larger point, that all energy projects, even renewables have consequences, is true. And those consequences should be noted and not swept under the proverbial rug. There is no free energy lunch.

        As for the economics of wind power…not to worry. Denmark is generating something like 25% of all their electricity from wind. And they have lots of sea gulls.

        • dean

          Self-correction. The Danes are getting only about 20% of their electricity from wind. Their goal is 50% by 2025. They employ over 20,000 in the wind industry and are a major exporter of both the technology and built systems.

      • John in Oregon

        Rupert, It was necessary to write it that way as the northwest is already 50 percent or more renewable as understood by a reasonable person. There is no other way to get it to 75% and make it sound like it’s a small first step.

  • patrick mcgee

    Larson’s an idiot and still quoting out of the LNG Speculators play book

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