 |
|
 |
 |
Plants and prices slowly growing
Natural gas plays an integral role in many area industries
By Alison Zielenbach/Caller-Times
Natural gas prices remain a point of concern this year for area industries.
In 2003, natural gas prices ranged from a low of $4.70 to a high of $7.18. The year closed out with prices in the $6 range, and, as the cold winter hit the Northeast in January, natural gas futures started to climb again into the $7 per 1,000 cubic feet range, in spite of higher natural gas reserves than last winter.
Local industries, like Air Liquide, Celanese, Elementis Chromium, Oxychem, Sherwin Alumina and Tor Minerals International are anxiously watching the prices edge up. Natural gas is used to fuel many of their processes, and any increase in manufacturing cost cuts deeply into profit margins.
Several local industries have had to fine tune operating procedures to be more efficient, install new equipment to reduce reliance on fuel, and in some cases, even operate at reduced capacities in order to keep a handle on costs.
"It's having a tremendous impact," said Tom Feeney, plant manager for Oxychem.
Investment in gas
While many tout imported liquid natural gas as the antidote to high natural gas prices and supply issues, the permitting and construction time frame for LNG terminals is long and arduous. The permitting process alone takes around 18 months and can cost up to $5 million. The construction time frame is around three years.
Three companies are considering sites for LNG regassification plants in San Patricio County, which, if built, represent an investment of $1.5 billion.
Cheniere Energy, in partnership with Sherwin Alumina, is furthest along in the process, having filed their documentation with the Federal Energy Regulatory Commission in December.
The company received notification in January that the filing had been accepted, so now they're collecting support from state agencies.
Cheniere LNG President Keith Meyer said the hope is to make the first shipment of liquid natural gas before the winter of 2007.
A rising demand
ExxonMobil has an option to purchase more than 300 acres owned by DuPont and plans to file for the required 13 reports to federal government within the next 18 months.
The receiving terminal will cost around $600 million and spokesperson Bob Davis said ExxonMobil would use the natural gas and put some onto the open market for sale. The first gas shipment from the ExxonMobil facility could be expected in 2008.
Occidental Energy Ventures, an arm of Occidental Petroleum Corp., is working on stage one of its permitting process, and Feeney said they hope to have the documentation to the government by June this year.
Early 2009 opening
The Occidental project would integrate the $400 million LNG facility with an existing power and chemical plant at the Oxychem site along the La Quinta channel. If all goes on schedule, the plant is slated to open early 2009.
There are currently four LNG terminals in the United States, located in Everett, Mass.; Cove Point, Md., Elba Island, Ga.; and Lake Charles, La.
The U.S. Department of Energy projects that the United States' demand for natural gas will rise from 22.8 trillion cubic feet in 2003 to about 33.8 trillion cubic feet by 2020. There are currently 30 LNG terminals in the permitting process along the Gulf and Atlantic coasts and the National Petroleum Council's study on U.S. natural gas supply and demand envisions five to seven new terminals in the next ten years.
Contact Alison Zielenbach at 886-3678 or zielenbacha@caller.com
|
|
|
|
Click
a category to view advertisers
|
|
|
How safe do you think our port is?
