The natural gas boom is the most prevalent in the United States, but international consumption, exportation, and exploratory activities will ultimately impact the United States.
We are seeing exploratory activities in far away nations. We are seeing impacts of natural gas on international economies. The most recent international natural gas activity has occured in Mexico, Japan, Brazil, and the United Kingdom.
The Mexican government wants to expand its natural gas pipeline system with U.S. reserves.
The plan is to invest $8 billion to expand the system that could be fueled by the South Texas and Eagle Ford shale fields.
Incoming Mexican President Enrique Pena Nieto is expected in October to award $3 billion in contracts for pipeline networks slated for industrial centers in northwest and central Mexico.
Pipeline company Kinder Morgan declared last week, however, that it was keen to connect networks in Arizona to a 600-mile pipeline system that could eventually run to the port city of Mazatlan.
According to the U.S. Energy Department, natural gas exports from the U.S. to Mexico were 500 billion cubic feet in 2010.
ConocoPhillips recently shipped its third cargo of liquefied natural gas from Alaska, the only port with the necessary permits.
A tanker, that can carry as much as 4.4 million cubic feet of natural gas, was shipped to Japan from the Nikiski terminal on the Kenai Peninsula in Alaska.
This represents the third LNG shipment from Alaska. Five more are expected this year to Japan.
The Alaskan plant is the only one in the U.S. permitted to sell domestic natural gas to Japan.
That could change, though. Chenier Energy Inc. was awarded a permit by the U.S. Energy Department and has plans for an LNG terminal in Sabine Pass, La.
Environmental groups have protested the exportation citing that the facility will lead to more hydraulic fracturing, a natural gas extraction method that they believe is harmful to the environment and public safety.
The Brazilian company HRT announced that it has discovered natural gas in a well in the remote Amazone jungle region.
HRT said the find is one of the best the startup has made in the area so far.
The well contains some of the best characteristics compared with what the company has found in five other natural gas discoveries in the Solimoes Basin. HRT holds a 55 percent stake in 21 exploration operations in the Solimoes Basin.
Although the discovery is the companies best so far, concerns remain about how the company will profit from the find. The area is so isolated, and that makes getting the gas to market a major challenge.
Despite HRT’s exploratory success, investors have abandoned the company. HRT’s shares are down nearly 80% during the last 12 months.
HRT plans to drill two more wells in the Solimoes Basin this year and it’s first offshore well in Namibia. Within the next year, the company expects to invest more than $450 million on exploration.
Demand caused a rise in British wholesale natural gas prices.
The undersupplied system was lacking more than 24.2 million cubic meters (mcm). This left gas prices trading at 56 pence per therm on Aug 13, up 3 pence from Aug. 10
Gas demand in Britain was expected to be around 190.9 mcm on Monday, according to National Grid.
With flows seen at 166.7 mcm, the system would be undersupplied by 24.2 mcm on Monday, requiring higher imports or storage withdrawals.
Britain’s gas storage sites are filled to over 95 percent, according to Gas Infrastructure Europe.
The rises in spot gas prices also impacted the power market.
Prices for baseload (24 hours) delivery the next day shot up by 13.25 pounds per megawatt-hour (MWh) since last Friday to 56 pounds a MWh on Monday morning.
Traders said that the outage of EDF Energy’s 500-megawatt (MW) Hunterston B-7 nuclear reactor that started last Friday had also helped push prices up.
Expected future prices have also risen. Gas prices for delivery next winter rose to 67 pence a therm on Monday morning, their highest level since May, and up over 8 percent since the beginning of the month.
Traders said that the rise was a result of concerns that Britain could face a gas supply squeeze in winter.