Energy / Natural Gas

• Jordan Scrambling to Replace Lost Egyptian Natural Gas Imports

  The Arab Spring has claimed a vulnerable Arab nation as “collateral damage” – Jordan. In the aftermath of Egypt’s uprising against President Hosni Mubarak, attacks began on Egypt's $500 million East Mediterranean Gas Company Ltd. pipeline, which exported Egyptian natural gas to Israel. The East Mediterranean Gas Company Ltd. was established in 2000 and is jointly owned by Egyptian General Petroleum Corp., which owns 68.4 percent of the venture. The pipeline sent natural gas from Egypt to Israel and beyond to Jordan and Syria via underwater pipelines from Al 'Arish to Ashkelon, with contracts starting in 2007, providing Israel’s Electric…

• Natural Gas Analysis for the Week of October 24, 2011

  After starting the week sharply higher, confirming the previous week’s closing price reversal bottom, December Natural Gas futures closed lower for the period.  The rally early in the week marked the formation of a minor bottom for the first time since early July, but the weak close put the market in a position to make a new low for the year. Based on the short-term range of 4.871 to 3.747, it is still possible but not probable that enough buyers can show up to drive this market into the 50% price level at 4.309. In addition, downtrending Gann angle resistance…

• Azerbaijan: Baku's Natural Gas Discoveries Reviving Interest in Caspian Pipelines

  The recent discovery of a sizable, new natural gas field in the Caspian Sea is giving officials in Azerbaijan additional reason to cheer. But the discovery also is highlighting a dilemma for Baku – one in which the abundance of gas is currently offset by a dearth of export capacity. It’s a problem that Azerbaijani officials are happy to have. The new gas field, discovered off the Absheron Peninsula, contains an estimated 350 billion cubic meters of gas and 45 million tons of condensate. An ebullient President Ilham Aliyev predicted on September 9 that the discovery will help turn Azerbaijan…

• Qatar's Giant Gas to Liquids Plant to Yield Profits of $6 Billion a Year

  The new gas to liquids plant in Qatar is the equivalent of a new giant oil field, in terms of production. But rather than producing crude oil, its main products are finished diesel and kerosene (jet fuel). It cost about $18 billion to build, and along with a smaller associated lng plant, will yield $6 billion a year in profits on a projected cost of $70 per barrel of oil. It will produce over 250,000 barrels of fuel per day when fully operational. At a cost of at least US$18 billion (Dh66.11bn), Shell is putting the finishing touches to a…

• Natural Gas Analysis for the Week of October 17, 2011

  Technical traders could not have asked for more from December Natural Gas futures last week. Not only did the contract post a daily closing price reversal bottom on October 13, but it followed up with a weekly closing price reversal on Friday, setting the stage for a possible start of a huge recovery rally. Although the main trend is down, the weekly closing price reversal bottom signal is often the start the bottoming process. A follow-through rally through last week’s high at 3.984 could be enough to trigger an acceleration to the upside. It’s not clear whether buyers are participating…

• Natural Gas Analysis for the Week of October 10, 2011

  Bucking this week’s trend in the other energy products, December Natural Gas futures made a new low for the year, closing at 3.821. Technically the market continued to walk down a pair of Gann angles from former tops at 5.283 and 4.871. This week these resistance lines come in at 3.843 and 3.911. Based on past performance, a penetration of these resistance levels will not be enough to temporarily change the trend which leads one to believe it is going to take a close over both of these angles to trigger the start of even a small short-covering rally. Fundamentally,…

• Natural Gas Analysis for the Week of October 3, 2011

  November natural gas futures continued its slide last week, closing sharply lower and showing no indication that a bottom is even in sight. Production is high and last week’s larger-than-expected increase in U.S. gas inventories demonstrated that demand is not even able to keep up. Late last week, the news that gas inventories rose 111 billion cubic feet versus guesses of 102 bcf was a clear signal that even seasoned analysts are not in touch with the true supply and demand picture. The current supply situation is being described as “massive” for this time of the year. Weather is playing…

• The Economic and Environmental Costs of Natural Gas Flaring

  To an alien orbiting Earth in a flying saucer, natural gas flares would be one of the most visible signs of human life on earth. Notice I said “human life,” not “intelligent life.” Flaring is the practice of burning off the natural gas that is produced in association with oil rather than piping it to market, using it at the wellhead, or re-injecting into the ground. Flaring was once common, but in more recent times, it has largely been limited to places like Russia and Nigeria. Now, though, it is becoming a big source of controversy in the United States.…

• Low Cost U.S. Natural Gas Production Put at Risk

  A lawsuit in Pennsylvania has put the state’s natural gas production at risk.  Thousands of oil and gas properties in the Marcellus Shale thought to have the ownership of the underlying oil and gas and mineral rights solidly set have been put to doubt. Gas production in Pennsylvania increased to about 2.8 billion cubic feet a day in July 2011, up from about 0.6 billion cubic feet in January 2010, according to the U.S. Energy Information Administration.  This is no small matter for the Northeast’s supply for the 2011-12 winter heating season and industrial production. Locally about 218,000 Pennsylvanians worked…

• Chesapeake’s Investment in Natural Gas Infrastructure Could be a Game Changer

  Chesapeake Energy is not resting on its laurels as the No. 2 producer of natural gas in the US. So awash is the US with gas following the release of vast reserves from shale beds during the last decade that reserves are reckoned to have increased from 30 years to 100 years of supply, and in the process, prices have plummeted. Good news then for energy consumers, particularly those that can switch power sources from, say, coal or oil to natural gas. Not least of which because oil and natural gas have lost their historic price linkage, putting natural gas…