7- GLEAMERGY and the LNG Bunkering Industry
GLEAMERGY and the take-off of the LNG Bunkering Industry
1 Context:
“LNG bunkering” is a novel concept where ships engines will use Liquefied Natural Gas (LNG) instead of liquid fuels (“bunkers”).
LNG tankers have been using LNG as a fuel since the very beginning, owing to the natural evaporation of the LNG transported as a liquid at minus 160°C and atmospheric pressure.
The concept of using LNG as a fuel on other ships such as ferries or cruise ships has emerged recently, prompted by :
- new IMO (International Maritime Organization) MARPOL VI emission regulations due to be effective in 2020
- attractive price of LNG compared with clean-burning liquid fuels.
2 A landmark deal for the LNG bunkering industry:
Real growth of the LNG bunkering was however hampered by the proverbial “chicken and egg” situation:
- Shipowners were conditioning their investing in LNG fuelled ships on a guarantee that LNG refueling infrastructure would be in place in their various Ports of call ….
- ….and Ports and Infrastructures Operators were conditioning their investing in LNG infrastructures on a guarantee from the Shipowners that these facilities would be used.
This “chicken and egg” situation is now being sorted out by moves such as CMA-CGM landmark decision that constitutes a world première:
- CMA-CGM, one of the leading containerships operators worldwide, orders 9 giant containerships ( 22.000 TEUs ) using LNG as a fuel
- CMA-CGM signs a long term ( 10 years – 300.000 t / year ) LNG supply contract with Total
The size and duration of this contract makes it a worldwide first in the LNG bunkering industry, and makes it possible for Total to build the required infrastructure, in this case an LNG bunkering ship suitable to refuel the CMA-CGM containerships.
Gleamergy was Advisor to CMA-CGM for this deal
Gleamergy : dominique.venet@gleamergy.com – +33 6 32 54 25 97
Press Releases :
5- Air pollution : The inaudible natural gas solution
This winter, air pollution in big cities has been brought to the forefront of the public debate not only in China or India, but also in Europe and particularly in France.
Cities like Paris, Lyon or Grenoble have had to introduce for a number of days various systems of car usage regulations, from mild ones such as reduction of maximum speed to more stringent ones such as alternate days according to even/odd license plate numbers.
Since January 2017, France has introduced a classification system, where each car is graded according to its pollution index; from now on, car circulation restrictions because of air pollution will be based on this index, resulting in banning the more polluting vehicles first.
This air pollution is mainly caused by particles emitted by liquid fuel combustion engines (chiefly diesel) as well as by coal-fired power plants – including plants in neighboring countries – and industrial facilities.
SOx and NOx from the same sources are also contributors, but were less of a focus this winter.
It should be noted that excessive air pollution was reported not only in big cities like Paris or Grenoble, but also in specific open areas where meteorological conditions led to emissions not being dispersed: no wind, no rain, air temperature stratification etc… Such was the case for example in some lower parts of the Alps valleys.
Natural Gas (NG) provides a clear solution to this atmospheric pollution: it is a clean burning fuel and does not emit any particles and quasi no SOx or NOx.
NG could be used :
· Either directly, using NG or LNG for transport
· Or indirectly, by replacing coal and liquid fuel power plants by CCGTs and switching transport to electricity
These facts are well known, but apparently only to those involved in the gas industry.
What is indeed startling is that this winter, during the worst occurrences of air pollution in French cities, the debate focused on the “good” energies, namely renewables (ENR) such as wind and solar, and the “bad” ones, namely the “fossil fuels”, oil an coal.
Nuclear was not perceived as a clean solution, but was not criticized either (this is France….). Debate however does start on issues like actual complete costs of nuclear and disposal of waste.
“Fossil Fuels” were in one dirty bag combining mainly diesel and little bit of coal, not very much used in France. Fossil fuels were deemed evil and should be disposed of.
But you may ask: what about Natural Gas ?
Good question! Mostly non existent, to the best unheard of as a clean alternative to polluting coal and diesel, to the worst thrown in the dirty bag of “fossil fuels”, ie to be disposed of asap.
I have to say it is painful to see NG being considered as bad a fuel as diesel, fuel oil or coal.
Which leads me to a remark often heard in recent years in Conferences, but not really acted upon:
The Gas Industry as a whole has been way too shy – once more – in not seizing this winter episode as an opportunity to advocate its position as the cleanest, safest and most economical solution pending full development of renewables solution, particularly solar, on an economic basis (and with a satisfactory dust-to-dust record…)
How is it possible that gas was virtually not mentioned in the public debate this winter during atmospheric pollution peaks, a golden opportunity to attract citizen’s attention?
Why couldn’t we imagine for example ads released in all medias during the air pollution crisis promoting natural gas benefits highlighted above? Talks in the various medias? More aggressive positions on regulating coal out of the market?
At a time where gas reserves are huge, market over supplied and gas price bound to remain reasonable at least for the medium term, if not longer, such actions of NG promotion would of course help the gas industry, but would be first of all a service rendered to our fellow citizens.
D.Venet
CEO
4- The complicated future of Oil Majors: first and foremost a management problem?
In its Sunday 4th / Monday 5th August 2013 edition, Le Monde exploration published an article entitled “The complicated future of Oil Super-Majors”.
This article looks at the problem of the decline in production of these Majors, who are having more and more difficulty in finding and producing as much petrol and gas as they would like; the reason given is the fact that the oil deposits that are easy and inexpensive to mine are controlled by State Companies of the oil-producing countries and that, as a consequence of this, the Majors have to turn to projects which are technically much harder and complicated to implement.
This phenomenon does indeed exist but is it the only explanation of the difficulty the Majors are having in renewing their reserves?
Over the last 5 or 6 years a series of major discoveries has been made in hydrocarbons in general and gas in particular: shale gas in the USA, gas reserves in the Eastern Mediterranean region and Israel in particular, considerable reserves in Mozambique and to a lesser extent in Tanzania and Uganda, and vast pre-salt deposits in Brazil. All these discoveries have at least two new common characteristics: the first one is that these considerable reserves have been discovered in completely new hydrocarbon trends, and the second is that none of the Oil Majors were involved in these discoveries.
The American shale gas was initially implemented by small companies such as Chesapeake; the Israeli deposits were discovered by Noble, the Mozambique ones by Anadarko, Uganda’s by Tullow and the Brazilian pre-salt deposits by Petrobras. No Majors, although Petrobras is not a small company.
Exploration does of course involve luck, but the fact that none of the Oil Majors were present initially in these discoveries, which were over varied and wide geographic zones and over several years, leads us to ask whether this could be a strong tendency rather than just a question of luck. Are the Majors still capable of the creativity and audacity that allowed the Independents (and Petrobras) to make these recent discoveries?
The Majors have proved, these last few years, their know-how and competence for pulling off production mega-projects for which the unit of account is in billions of dollars or even tens of billions of dollars. The implementation of such projects requires extremely strict organization and continuous control involving complicated decision making processes based on significant comitology. One possible theory is that this work method, which is essential for big production projects but very complicated, has affected the Exploration activities by excessively blocking the necessary risk taking in this area.
In other words, by becoming Production champions, the Majors may have lost their Explorer souls.
In this hypothesis, the smaller companies don’t have the same problem as they haven’t implemented any mega-projects and their decision making protocols are much shorter and based on the trust they have in their teams rather than the processes.
If this is the case, the question that an Exploration / Production Major should be asking itself is whether it should adapt its setup to remedy its lack of success in Exploration or, on the contrary, if it should adapt its business model by leaving Exploration to smaller companies that it could take over post discovery (or that it could finance as independent companies), while bringing its expertise in the development of major Production projects that the smaller companies do not have. This solution has been retained by the Majors for many of the projects above, but probably by opportunism rather than deliberate and assumed strategy.
In conclusion, the key to further development of the Majors may lie in adapting their own internal organization as much as in resolving technical, political and financial problems that they’ve always been able to resolve successfully previously.
D.Venet
Gleamergy
dominique.venet@gleamergy.com
3- Ecological comparison Seoul – Paris
I recently spent a week in Seoul.
I was surprised by two things: the excellent quality of the air and the low noise levels, compared to the pollution and noise to be found in Parisian streets.
This was not my first wholesale nfl jerseys time in Seoul and I did not notice this Russia, difference during my previous visits in the 90’s, 00’s or 10’s.
There are two possible explanations for this difference: the situation in Seoul has gotten a lot better or that of Paris has gotten much worse; in fact, pilotprosjekt it is both:
A “green” policy has been in place in Seoul for several years:
- All wholesale nfl jerseys buses run on natural gas (NGV: Natural Gas Vehicles).
- Cars are either hybrid or petrol run; there are no diesel cars.
The result is moderate pollution and a reasonable noise level even on very busy avenues. The Sox, NOx and particles wholesale jerseys pollution and the noise levels from gas and petrol run motors are indeed a lot less than that of the diesel motors that we favor in France.
You could argue that a “green” policy has also been in implemented in Paris:
- A tax incentive system for diesel motors wholesale nfl jerseys on the grounds that they produce less CO2 than petrol ones: thanks to this grand initiative the majority Tienda of French cheap nba jerseys cars these days have diesel motors.
- A traffic control policy designed to deter motorists, which results in permanent traffic ban jams, during which the slowed down diesel motors generate noise and atmospheric pollution.
Seoul has shown that a very large modern city (20 million people) can limit its pollution and noise levels; Paris has proved, once again[1], that ecological pretexts can result in accomplishing the exact opposite of what they originally set out to do…
[1] please X250 see the other article on this site: ”The ban on exploration of shale gas: a breach of the precautionary principle?”
D.Venet
Gleamergy
dominique.venet@gleamergy.com
2- Russia, China and the Northern Route
The recent signature by Mr Poutine of a document agreeing to provide gas to China can be related to another, less Кухня mediatized, event which happened towards the end of 2013, the first journey of a Gazprom-chartered cheap jerseys LNG carrier from Northern Europe to Asia via Watches the “Northern Route” (i.e. the direct maritime route between Europe and Asia via the north of Russia).
In both cases Russia demonstrated its intention to no longer rely solely on Europe as it’s near exclusive client of natural gas exports, and to develop sales in Asia. Russian sales to Asia began with Sakhaline’s LNG but these were moderate and from the gas fields which wouldn’t have been able to supply Europe.
Both of these examples lead ban us to reflect on the notion of Europe / Asia arbitration by Russia, a fundamentally new Trucks situation.
In the case of the Northern Route, it is what we could call “direct” arbitrage: Yamal LNG methane carriers could either go west wholesale MLB jerseys towards Europe or East towards Asia; for the first time a Russian gas field is open to arbitrage.
In the case of the Chinese contract, the arbitrage would be “indirect”: this project will require considerable investments, in which the Russians will understandably want to keep a majority hold; leaving possibly a shortage of capital to maintain and repair existing West Russian facilities which supply Europe.
In conclusion, Russia is preparing to reduce its dependence on Europe, its historical exclusive client, in the medium term (and it is in this direction that the dependence existed and not the other way round), and to put itself in wholesale NBA jerseys a position to arbitrage between Asia and Europe, as is already the very profitable case for Qatar.
Indeed, one of the reasons that European prices have been 30 to 50% cheaper than Asian prices is the supply from Russian pipelines in particular. Asian arbitrage by Russia could decrease this difference to the detriment of Europe.
The USA is not concerned by this, protected by its shale gas; but this subject is taboo in France, so let’s not talk about it …[1]
[1] please see the other article wholesale NBA jerseys on this site: ”The ban on exploration of shale gas: a breach of the precautionary principle?”
D.Venet
Gleamergy
dominique.venet@gleamergy.com
1- The ban on the exploration of shale gas: a breach of the precautionary principle?
The people opposing production of shale gas in France state the “precautionary principle” (incorporated in the French Constitution), notably the potential environmental risks of this kind of production. But what if the contrary were cheap jerseys true? In up every decision to not do something a risk is taken: that of accepting the consequences of non-action.
In this case, the chain of reaction is the following:
- The cost of gas in the USA has dropped to $3-4/mmbtu learn following the cheap jerseys production of He shale gas, compared to a price of $11-12/mmbtu in USP Europe.
- Because the price of gas is so reasonable, American electricity producers are closing their coal-fired plants and replacing them by gas-fired plants; in the USA, gas is taking over coal in the production of electricity.
- The price of American coal wholesale jerseys China is dropping as the coal-fired plants close and it cheap jerseys is forced to look CEO for new opportunities cheap nfl jerseys elsewhere.
- Its new market is Europe, where gas prices are still high because there are no alternatives to importation as shale gas is not produced.
- In Europe, the electric companies are closing their gas-fired electric plants in favor of coal-fired plants: in Europe it is coal that is taking over from gas in the production of electricity.
- A coal-fired electric plant pollutes a lot more than a gas-fired plant: it generates 2 times more CO2 per kWh of electricity produced, as well as a whole lot of other pollutants (particles, SOx, NOx) whereas gas-fired particles only generate CO2 and water vapor.
- The European CO2 market is not working as the price of CO2 is still too low to highlight the environmental advantages of gas. Indeed, European competiveness would be affected elsewhere if this were not the case and the European Parliament recently demonstrated that is was conscious of this by refusing to drastically reduce its free CO2 emission allowances.
Therefore, it must be noted that the USA, who are certainly not champions in the fight against climate change, are very significantly reducing their CO2 emissions while Europeans, who are much more righteous in their declarations, are in fact considerably increasing their own emissions.
In conclusion, the decision not to explore shale gas in order to avoid potential risks (which are probably treatable) has led to an immediate and definite increase in air pollution in Europe. This decision is therefore contrary to the precautionary principle which would, in this case, imply that the necessary research was done and that a complete comparison between the disadvantages of electricity generation based on shale gas production and those of coal-fired electricity was made.
D.Venet
Gleamergy
dominique.venet@gleamergy.com