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Page added on June 30, 2017

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South Korea Is Very, Very Interested in America’s Natural Gas

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One thing became clear on the fourth day of the White House’s “Energy Week”: South Korea is really, really into U.S. natural gas.

In less than 24 hours, South Korea’s energy companies had announced four partnerships with U.S. companies to explore opportunities in the U.S. natural gas business. Korea Gas Corp., the state-owned gas supplier, said it’ll look into potential investments in liquefied natural gas projects in Alaska, Texas and Louisiana. SK Group signed an agreement with General Electric Co. and Continental Resources Inc. to pursue shale gas developments.

It makes sense. South Korea is already one of the world’s biggest importers of LNG and has bought eight cargoes of U.S. gas from Cheniere Energy Inc.’s Sabine Pass terminal in Louisiana. While Sabine Pass is the only one sending shale gas abroad, dozens of terminals have been proposed along U.S. coasts to do the same. The exports have put the U.S. on a path to becoming a net gas exporter for the first time in decades.

President Donald Trump noted during an “Energy Week” event in Washington Thursday that South Korea leaders were visiting the White House. He said they’d be “talking about them buying energy from the United States of America. I’m sure they would love to do it.”

U.S. LNG may in fact play a big role in furthering South Korea’s energy policies. After the election of Moon Jae-in as president in May, the country is looking to transition away from coal and nuclear power in favor of cleaner natural gas-fired electricity generation. And buying more U.S. fuel could allow the country to smooth geopolitical disputes over unbalanced trade, Korea Gas Chief Executive Officer Lee Seung-Hoon said Sunday at the Sabine Pass terminal, where the company celebrated the start of an LNG contract with Cheniere.

“All of these projects are looking to find more long-term offtake in order to get the financial support they need to move forward,” said Anastacia Dialynas, analyst at Bloomberg New Energy Finance, in a phone interview Thursday. South Korea “might even be pitting them against each other” by exploring several projects to “see who offers the best terms,” she said.

The Port Arthur, Texas, LNG export terminal is being developed by Sempra Energy and Woodside Petroleum Ltd., and Energy Transfer Equity LLC and Royal Dutch Shell Plc are planning the Lake Charles, Louisiana, one. The Alaska LNG export project is being proposed by the state’s Alaska Gasline Development Corp.

Spot LNG prices in Singapore traded at about $5.244 per million British thermal units Thursday, according to a Singapore Exchange Ltd. assessment. That’s down from more than $14 in October 2014 as production capacity rises and oil prices have tumbled.



22 Comments on "South Korea Is Very, Very Interested in America’s Natural Gas"

  1. rockman on Fri, 30th Jun 2017 7:15 am 

    “The exports have put the U.S. on a path to becoming a net gas exporter for the first time in decades.” Yes, certainly possible. But good to remember it won’t surplus NG shipped overseas but resource US consumers will be outbid for by foreign buyers. IOW while the US might be a net exporter it will still be importing some NG.

    But US consumers being outbid by foreign buyers isn’t a new situation: since 2010 NG pipeline exports to Mexico have increased 600% to an annual rate last March of 1.5 trillion cubic feet.

    All of which is just fine from the Rockman’s perspective: anything that increases the price of the NG he sells to US consumers is a good thing.

  2. Kenz300 on Fri, 30th Jun 2017 7:57 am 

    Wind and solar with battery storage are the future.

    Fossil fuel investments will be a bust. Look how fast coal companies went bankrupt. How much money did investors lose.

  3. Anonymous on Fri, 30th Jun 2017 12:38 pm 

    I remember you saying we would never be a net gas exporter. After it happens, may I run around you going “neener” “neener”?

    😉

  4. rockman on Fri, 30th Jun 2017 1:11 pm 

    A – I believe you misinterpreted my words. The US may become a net NG exporter but we still don’t have an excess of NG production. The NG we export is production taken from our consumers who are outbid for it by foreign buyers. If we weren’t selling to foreign buyers the price would be lower and much more switching from coal to NG wuld be happening.

    Same reason we export more refinery products then any other country: foreign buyers are able to pay more then our consumers.

  5. Anonymouse on Fri, 30th Jun 2017 2:56 pm 

    “Same reason we export more refinery products then any other country: foreign buyers are able to pay more then our consumers.”

    RoFL, Good bullstein there narrativeman. Hey, if all us ‘foreigners’ are so able and willing to pay (extra) for ‘amerikan’ refined products, why doesnt the uS just export 100% of everything it refines? I mean, thats good market logic right? If uS ‘consumers’ are so impoverished they cant afford to pay a premium like ‘we’ supposedly can, why bother selling anything to joe-six pack at all. Far more profitable to sell it all to…well, just about anyone else right?

    Let em eat kerogen I say.

    Oh, you neglected to mention (again), that the uS oil cartel (or Oil-Qaeda if you prefer), often controls, or dominates the markets and distribution in those foreign countries it is ‘exporting’ to. IoW, the uS’s vertically integrated cartel are just gouging on a product they often ‘refine’ and then sell back to the people they stole it from in the first place.

    But the real reason, all the foreigners, are paying those premiums, is to subsidize uS ‘consumers’ and industry. It has little do with ‘willingness’, and everything to do with a dealing with a rigged cartel. But for you to mention that inconvenient fact, would poke another gaping hole in your narrative wouldn’t it?

    You do love to overstate the significance of those faux uS ‘exports’ at every opportunity, that’s for certain.

  6. Davy on Fri, 30th Jun 2017 7:16 pm 

    We know how bad the situation is in the US on multiple levels. China is likewise facing serious economic issues. Most here ignore this negative Chinese situation as unimportant but the reality is China is nearing a reset. Combine the problems with the US, China, and Europe, then throw in a NK and ME situation and what do we get…. It can’t be good and this is why we are walking on egg shells now and pretending differently.

    “China Faces Its Comeuppance” – Kyle Bass Warns Of “Tectonic Shift” In US Relationship”
    http://tinyurl.com/ycwnhtht

    “tectonic shift” in US-China relations in the last few days, pointing to two crucial events…1. Things changed drastically when US launched unilateral sanctions on China over North Korea…”Xi is a control freak and he absolutely doesn’t appreciate the United States acting unilaterally” 2. Things escalated when Trump sold $1.4bn in weapons to Taiwan, angering Beijing more as Bass notes: “Taiwan was the one area which Beijing has asked Trump to stay away from during his meeting at Mar-a-Lago.”

    “But then Bass shifts to the potentially even more precarious situation under the hood of China’s economy. As Reuters reports, China’s leaders want the restructuring of their massive non-performing loans problem to address financial risks while avoiding big employee lay-offs, and have instigated ‘cure by committee’…”The solution for zombie firms isn’t just bankruptcy,” a Shandong-based banking official told Reuters. “The impact of bankruptcy is just too big. Just think about the thousands of workers. Social stability is key.”

    “China is avoiding the crisis of calling in loans that can’t be repaid anyway,” said Paul Gillis, professor of accounting at Peking University’s Guanghua School of Management. “This buys time to do things in an orderly way.” But Bass makes the crucial point that there are over 12,800 credit committees in China right now – overseeing CNY 14.5 trillion in debt for equity swaps – which is 8% of China’s total non financial debt, and is over 3x the official NPL figure of 1.6%-1.9% of GDP.”

    “His final blow to any hopes that this solution will work…”This exceeds all the equity in the entire Chinese banking system.” However, Bass’s final warning of the endgame of this credit bubble is far more ominous, because all of the new-found economic confidence and military condidence is “based upon a massive credit expansion…”

  7. makati1 on Fri, 30th Jun 2017 7:49 pm 

    Hmm. I just read another article saying that South Korea was making a deal with Russia for their gas. Now, who do I believe? An Asian source or Bloomberg? And who would be cheaper the U$ or Russia? Answer to that last question: Russia. Location, location, location.

    “By 2030, the share of natural gas power plants in the total energy output of South Korea should reach 37%. This news is of great importance for Russia: according to representatives of the South Korean Foreign Ministry, the gas that will soon become the main source of energy in the country is going to be imported from Russia.”

    http://journal-neo.org/2017/06/29/prospects-of-long-term-cooperation-between-russia-and-south-korea/

    Guess we will just have to wait and see. lol

  8. Anonymous on Fri, 30th Jun 2017 9:13 pm 

    You are full of shit, Rock. You said we wouldn’t be a net exporter. When it happens I am going to rub your face in it. Stand by.

  9. DerHundistlos on Fri, 30th Jun 2017 10:15 pm 

    Siss-

    I decided to fact check Rockman’s information and what I found is in direct opposition to his claims. According to S&P, through the end of 2015, US coal exports reached a six year LOW of 67.3 million mt NOT anywhere close to the doubling he claims.

  10. MASTERMIND on Fri, 30th Jun 2017 11:05 pm 

    Rockman is a paid shill. He always babbles and babbles trying to sound like an expert. But the way you can spot an expert is that explain things simply and with evidence.

  11. Apneaman on Sat, 1st Jul 2017 12:01 am 

    Hey Davy, here’s one reporting on your girlfriend.

    Heavy Rain Leads To Flooding, Floating Cows Around Maryville

    http://kcur.org/post/heavy-rain-leads-flooding-floating-cows-around-maryville#stream/0

    Don’t worry, I won’t tell the wife, but you may want to get some gum or mints to disguise the scent of cud on your breath.

  12. makati1 on Sat, 1st Jul 2017 12:06 am 

    Hahahahahaha! Thanks Ap. A good laugh is always welcome.

  13. Davy on Sat, 1st Jul 2017 4:56 am 

    At least I have a wife and a good one. You have your 5 pals and makati is a twink with a Filipino boyfriend. You talk sometimes like you pinch hit for the home team maybe that is why you and makati are so tight. Digital bromance and the 5 pals sounds so wholesome.

  14. deadlykillerbeaz on Sat, 1st Jul 2017 7:18 am 

    The North Koreans will probably try to sink one of those cargo ships hauling LNG.

    Then things will get interesting, really, really interesting.

    All is fair in love and war.

  15. rockman on Sat, 1st Jul 2017 10:31 am 

    Derhund – “According to S&P, through the end of 2015, US coal exports reached a six year LOW of 67.3 million mt NOT anywhere close to the doubling he claims.” Apparently your research abilities are on par with that of a 5 year old…as is your reading comprehension. LOL. Did I say we were exporting twice as much coal in 2015? No, my darling child. I said that coal exports doubled by 2012 during President Obama term. And one more time here’s that DOCUMENTATION from the EIA.

    https://www.eia.gov/todayinenergy/detail.php?id=30332

    Typically a much better source then the S&P. Although in this case S&P is correct. Probably because they are sourcing the EIA. Maybe you can find an adult to help you read this curve. LOL:

    https://www.eia.gov/todayinenergy/detail.php?id=30332

    And you apparently can’t even find the latest current US coal export numbers: in 2016 US coal exports have declined even further to 60 mm tons/year compared to the 67.3 mm tons/year you posted. Which only confirms the point I made in my original post: President Trump will have a very difficult time increasing coal exports from 60 mm tons/year to 120 mm tons/year as was done in 2012 during President Obama’s term.

    So thank you very much for challenging the FACTS I posted. Not only does it validate the Rockman but it also highlights the misconceptions held my many who, I guessing in your case, have English as a second language. LOL. Just some friendly advice: before so obviously posting a foolish criticism of anyone’s post: you might want to double check the facts before you embarrass yourself again. LOL.

    I might offer the same advice to the self proclaimed “MASTERMIND”, a title that seems unwarranted given the same inability as Derhund to read the simple DOCUMENTATION the Rockman posted as opposed to the criticism offered by the MINIMALMIND. LOL.

    “But the way you can spot an expert is that explain things simply and with evidence.” But I must thank the MINIMALMIND for tagging me as an export since I did say, in very simple words, that US coal imports doubled under President Obama’s term in 2012 and provided that evidence as published by the EIA. The Rockman himself is much too humble to call himself an expert. He’s satisfied with the facts making that case. LOL.

  16. Sissyfuss on Sat, 1st Jul 2017 10:48 am 

    So Rockpaperscissors, MM by tagging you as an export for covering imports gives great import to you as an expert, which is expected in my experience.

  17. rockman on Sat, 1st Jul 2017 10:49 am 

    Mak – I’m not sure what your confusion is since the two articles don’t seem to contradict each other. The US is just hoping for a larger market share by competing with the other 13 countries that currently ship LNG to SK:

    “South Korea, the world’s second-largest buyer of LNG, boosted its imports of the chilled fuel by 3 percent in March year-on-year. The country imported 3.53 million mt of LNG in March.

    The world’s largest LNG exporter, Qatar, remained the dominant source of South Korean imports with 884,057 mt of the chilled fuel imported from Qatar last month. Australia was the second-largest LNG supplier to Korea in March with 774,113 mt. The remaining volumes imported into South Korea were sourced from Oman, Malaysia, Indonesia, Peru, Brunei, Russia, USA, Nigeria, Equatorial Guinea, Angola and Trinidad and Tobago.”

    http://www.lngworldnews.com/south-koreas-lng-imports-up-in-march/

  18. rockman on Sat, 1st Jul 2017 11:00 am 

    Sissy – As you might imagine I’m certainly no expert when it comes to coal exports. But I am just as capable of reading a f*cking EIA chart as well as a 12 year old. LOL. A skill seemed lacking by Derhund and MINIMALMIND.

    As they say: a one-eyed man is King in the land of the blind. In this case the ability to read a simple EIA chart with one eye closed gives me a big edge over anyone looking at that chart when their childish prejudices forces both eyes closed. LOL.

  19. Kenz300 on Sat, 1st Jul 2017 12:24 pm 

    South Korea should move to using more Wind and Solar power.

    No need to pay for IMPORTS.

  20. DerHundistlos on Sat, 1st Jul 2017 1:20 pm 

    Rockman-

    Obviously, I am not the only poster that finds you to be thoroughly disingenuous. Your words, “As was President Obama’s position as coal exports doubled during his term from 60 million ton per year to 120 million tons per year.”

    WRONG.

  21. DerHundistlos on Sat, 1st Jul 2017 1:30 pm 

    Rockman-

    Your words, “As was President Obama’s position as coal exports doubled during his term from 60 million ton per year to 120 million tons per year.”

    Then you say, ” No, my darling child. I said that coal exports doubled by 2012 during President Obama term.”

    Since I am a slow learner, show me where you used the 2012 qualifier in your original statement that I quoted above or is 2012 written in a special ink only visible to certain readers.

    You got caught, plain and simple.

  22. Anonymouse on Sun, 2nd Jul 2017 12:30 am 

    Apparently, the ‘prez’ in the uS not only directly manages oil extraction, but, now it seems, he looks after the coal file as well. With all the time and attention the ‘president’ needs to manage these uS president-operated industries, I dont know he managed to find to time for that that AND start all those wars amerika loves so much.

    Is there anything the uS president, you know, delegates to any of the other 315 million morons in the uS, narrativeman?

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