Gas alert as demand and prices rise

[Little John]

There's a case being fought in the UK even as I squeak: a completely-paralysed chap with a full complement of Marbles who just wants someone to do him the last favour. But it's still illegal here for religious reasons. That's very lucrative at the mo for people who run olde folks' homes. One chain of which went bust recently as it turned out all their premises were owned by a bank. Yes, we're back to bankers!

To be fair, RC, I think it is more than religion behind the reticence in some quarters to enact assisted death laws. It seems more than mere coincidence to me that as resources are getting tighter, suddenly the MSM is encouraging and facilitating an open "debate" into the pros and cons of euthanasia and assisted suicide.

I fully accept that life as an elderly and seriously infirm person is no fun and can well understand why someone may wish to shorten their lives accordingly and may require help from someone to do that. I just think this in one of those occasions where there really is no safe law that could be passed to account for such behaviour. It just has to be sympathetically dealt with on a case by case basis as and when it comes up before the courts.

[mikepepler]

Not looking good for next winter.
Storage filling at about 10 or 11% a month and now about 22% full.
So to refill the remaining 78% of the storage at this rate will take at least 7 months and maybe nearly 8 months.

I think that winter will be back by then.
There should be more wind power on line by then which will save some gas, but also there will be less coal burning which will tend to increase gas demand.
Next winter will probably be milder but it seems unwise to count on this.

I've also been watching this... They are going flat out to refill Rough, but there just aren't enough months between now and next winter to fill it, unless we have a very mild Oct-Dec period...

[PS_RalphW]

I've noticed that although long term storage is filling at close to max rate, medium range storage is being drawn down again, and short range storage is now completely empty (and I suspect will never be refilled, as it's function is partly covered by LNG storage). Also the pipeline pressure is down a bit. Demand is still above seasonal norm.

We are really struggling with supply.

[Tarrel]

http://www.express.co.uk/news/uk/399996 ... t-millions

MILLIONS of households who are ­facing crippling rises in their monthly energy charges will be hit by further big price hikes by the end of the year, experts warned last night.

[stephendavion]

As the gap between demand and supply is increasing for gas, Centrica is buying gas from US. Here I read that it will purchase 1.75 million metric tonnes of LNG per annum, ensuring the generation of electricity for 1.8 million UK homes over a period of 20 years, isn't that a good move??

[adam2]

As the gap between demand and supply is increasing for gas, Centrica is buying gas from US. Here I read that it will purchase 1.75 million metric tonnes of LNG per annum, ensuring the generation of electricity for 1.8 million UK homes over a period of 20 years, isn't that a good move??

Better than the lights going out certainly, but better still would to use less electricity and to produce more of what we do use from renewables.

Of course the lights may go out anyway, in which case the imports might mean the difference between 12 hours a week of rota blackouts and say 15 hours.

And of course imports have to be paid for and are vulnerable to disruption.

[PS_RalphW]

I have very serious doubts that any contract for US LNG exports will be honoured for the next 20 years. The US Shale gas bubble is rapidly deflating, and 3/4 of the drilling rigs that inflated it have been redeployed on shale oil drilling, which is currently (just about) economically sustainable. US NG prices are going to have to rise a LOT to get those drilling rigs redepoyed again, and that will put intense political pressure on regulators to curtail exports. The US has enough NG to supply domestic demand at moderate (by European standard) prices for some decades. If the US consumer is exposed to the current global market price, there will be rioting on the streets of Washington.

[adam2]

I have very serious doubts that any contract for US LNG exports will be honoured for the next 20 years. The US Shale gas bubble is rapidly deflating, and 3/4 of the drilling rigs that inflated it have been redeployed on shale oil drilling, which is currently (just about) economically sustainable. US NG prices are going to have to rise a LOT to get those drilling rigs redepoyed again, and that will put intense political pressure on regulators to curtail exports. The US has enough NG to supply domestic demand at moderate (by European standard) prices for some decades. If the US consumer is exposed to the current global market price, there will be rioting on the streets of Washington.

Yes.

[mikepepler]

Yesterday's cold weather resulted in a day with a small amount of gas actually being *withdrawn* from Rough, as well as medium range stores and LNG. Can't afford many days like that with the long slog to refill by winter...

[Ballard]

http://news.sky.com/story/1095134/gas-u ... unning-out
Britain was six hours from running out of gas in March, it has been reported.

High demand during record cold temperatures during the month combined with a pipeline fault to drive stores of gas "dangerously low", the Crown Estate said.

But National Grid, which pipes gas around the UK, insisted the nation has "substantial resilience" and diverse supply sources, including access to imports of liquefied natural gas (LNG).

At the time, reports said Britain was two days from running out of stored gas, but the Crown Estate, which manages the Queen's property portfolio - including vast underground gas caverns - said it came even closer to supply interruptions.

The supply squeeze will raise concern over Britain's increasing reliance on energy imports as domestic production falls, and add to fears over rising energy bills.

Rob Hastings, energy and infrastructure director at the Crown Estate, was reported by the Financial Times as saying: "We really only had six hours' worth of gas left in storage as a buffer.

"If it had run any lower it would have meant ... interruptions to supply.

"The bottom line is that in the UK we are in a place where the gas supply is dangerously low."

[biffvernon]

And, if you will recall, it was the unusually windy weather, that saved the day.

[adam2]

Indeed, it seems probable that without the greater than expected wind power that the lights would have gone out.

More windpower capacity is being built which will help a bit, but a lot of coal burnng capacity is closing which will increase gas demand.

It seems unlikely that our gas storage will be full before next winter.

[JavaScriptDonkey]

And, if you will recall, it was the unusually windy weather, that saved the day.

Perhaps it was the unusually windy weather that generated the need for everyone to turn the heating up?

[vtsnowedin]

Not having read every post in this thread I am not quite clear about why sufficient gas cannot be put into storage prior to next winter. How many ships full of LNG are we talking about and why can't they arrive in sufficient time to meet demand. Even if pumping and storage facilities are inadequate it would seem that ships could be scheduled to arrive during the winter and pump directly into the distribution system. If too much is ordered and delivered the only harm would be to have a balance left in storage next spring which with expected continued price increases for energy would be a good thing.
Is there really a problem with physically delivering enough gas or is the delivered price the problem?

[adam2]

Not having read every post in this thread I am not quite clear about why sufficient gas cannot be put into storage prior to next winter. How many ships full of LNG are we talking about and why can't they arrive in sufficient time to meet demand. Even if pumping and storage facilities are inadequate it would seem that ships could be scheduled to arrive during the winter and pump directly into the distribution system. If too much is ordered and delivered the only harm would be to have a balance left in storage next spring which with expected continued price increases for energy would be a good thing.
Is there really a problem with physically delivering enough gas or is the delivered price the problem?

There are two main problems.

Firstly no matter how much gas might be available during the Summer, there is a definate limit as to how quickly this gas may be injected into the long range storage. We need to pump gas into the long range storage at the maximum possible rate every hour of every day between now and next Winter in order to nearly fill it. It is already too late to completly fill it.

Secondly, there is a limit on the volume of imports available at any time, pipelines have a finite capacity and only a certain number of the specialist LNG tankers* exist.
This limit is not an absolute limit but is somwhat elastic depending on the price offered.
We could presumably attract more imports by paying a higher price, the capacity of pipelines though finite, is not allways fully utilised and if we offered a high enough price then more gas could be imported thus.
Likewise, whilst the number of LNG tankers is fixed *, the proportion of those tankers serving the UK market is not fixed, by paying more we could probably attract more LNG shipments.
Even in mid winter we might in theory be able to manage without much storage by scheduling LNG imports to match demand, in practice the price would be very high and the supply very vulnerable to interuptions.
So we have not run out of natural gas, but it would seem that we are about to run out of cheap natural gas. This is somwhat similar to running out of cheap oil, but not strictly comparable. Oil is fairly reasily transported and the price is therefore broadly similar anywhere in the world, being determined by the global balance between supply and demand.
Natural gas is not so easily/cheaply transported and the price therefore varies a lot regionaly being determined partly by the LOCAL balance between supply and demand.

*the number of tankers is fixed only in the near term, more could be built but this is expensive and takes time. No help for next winter.