This article is from the source 'nytimes' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.nytimes.com/2018/01/30/opinion/sanctions-russia-natural-gas.html

The article has changed 2 times. There is an RSS feed of changes available.

Version 0 Version 1
America’s Natural Gas Hurdles America’s Natural Gas Hurdles
(1 day later)
Despite American sanctions against Russian natural gas producers, a cargo of liquefied natural gas that was most likely produced at Russia’s Yamal plant arrived in Boston this past weekend.Despite American sanctions against Russian natural gas producers, a cargo of liquefied natural gas that was most likely produced at Russia’s Yamal plant arrived in Boston this past weekend.
This development would seem to fly in the face of the sanctions imposed by President Barack Obama in 2014, though those restrictions apply to the financiers and producers of Russian oil and natural gas, not the output. But the arrival of the gas in the Northeast after frigid temperatures does raise questions about whether President Trump’s efforts to pursue American energy dominance in the world are falling short.This development would seem to fly in the face of the sanctions imposed by President Barack Obama in 2014, though those restrictions apply to the financiers and producers of Russian oil and natural gas, not the output. But the arrival of the gas in the Northeast after frigid temperatures does raise questions about whether President Trump’s efforts to pursue American energy dominance in the world are falling short.
The journey of this liquefied natural gas from the Yamal Peninsula in northern Siberia to Boston may at first appear like a well-orchestrated move from the Kremlin playbook to hide what might be an embarrassing delivery for the United States. On Dec. 8, President Vladimir Putin oversaw the opening of Yamal L.N.G., Russia’s second liquefied natural gas plant. The project was personal for Mr. Putin for several reasons.The journey of this liquefied natural gas from the Yamal Peninsula in northern Siberia to Boston may at first appear like a well-orchestrated move from the Kremlin playbook to hide what might be an embarrassing delivery for the United States. On Dec. 8, President Vladimir Putin oversaw the opening of Yamal L.N.G., Russia’s second liquefied natural gas plant. The project was personal for Mr. Putin for several reasons.
First, despite being the largest natural gas exporter in the world, Russia has ranked only seventh as an exporter of liquefied natural gas, and Yamal is expected to improve the country’s position (the United States is expected to be the third-largest L.N.G. exporter by 2020).First, despite being the largest natural gas exporter in the world, Russia has ranked only seventh as an exporter of liquefied natural gas, and Yamal is expected to improve the country’s position (the United States is expected to be the third-largest L.N.G. exporter by 2020).
Second, Yamal’s completion signaled a small Kremlin victory over Washington — the majority owner of the plant is Novatek, which is one of the energy companies hit by the 2014 financial sanctions over Russia’s actions in Ukraine. While the aim was to derail Yamal’s construction, in the end, the plant was financed by Russian and Chinese banks and its output never faced sanctions.Second, Yamal’s completion signaled a small Kremlin victory over Washington — the majority owner of the plant is Novatek, which is one of the energy companies hit by the 2014 financial sanctions over Russia’s actions in Ukraine. While the aim was to derail Yamal’s construction, in the end, the plant was financed by Russian and Chinese banks and its output never faced sanctions.
Thus it was under the proud eyes of Mr. Putin that the first cargo from Yamal L.N.G. was loaded into the Russian icebreaker/tanker Christophe de Margerie (named after the recently deceased chief executive the French energy company Total, which holds a 20 percent interest in the project.) The cargo was initially intended for Asia, but as gas prices soared in the Britain, it made its way to the Isle of Grain terminal near London on Dec. 28. Thus it was under the proud eyes of Mr. Putin that the first cargo from Yamal L.N.G. was loaded into the Russian icebreaker/tanker Christophe de Margerie (named after the recently deceased chief executive the French energy company Total, which holds a 20 percent interest in the project.) The cargo was initially intended for Asia, but as gas prices soared in Britain, it made its way to the Isle of Grain terminal near London on Dec. 28.
Here the gas was briefly stored but never made its way to the British grid. On Dec. 30, the French energy company Engie’s Gaselys tanker picked up cargo and set off for Boston, where gas prices were soaring because of the cold winter.Here the gas was briefly stored but never made its way to the British grid. On Dec. 30, the French energy company Engie’s Gaselys tanker picked up cargo and set off for Boston, where gas prices were soaring because of the cold winter.
Because the time between the unloading of the Russian vessel and loading of the Gaselys vessel at Grain was brief, it is safe to assume that the Gaselys vessel was carrying at least some, if not all, of the Russian gas from the Yamal L.N.G. project. The storage facility in London might also have been holding L.N.G. from other producers. Nonetheless the Russia news media has gloated over this gas delivery to Boston and claimed it as Russian.Because the time between the unloading of the Russian vessel and loading of the Gaselys vessel at Grain was brief, it is safe to assume that the Gaselys vessel was carrying at least some, if not all, of the Russian gas from the Yamal L.N.G. project. The storage facility in London might also have been holding L.N.G. from other producers. Nonetheless the Russia news media has gloated over this gas delivery to Boston and claimed it as Russian.
In the globalizing natural gas markets, we can expect more of these trades. Once, natural gas was primarily a regional resource delivered by land-based pipelines, but in recent years, there has been a rapid growth in the shipping of natural gas in liquefied form across the globe. Indeed, another shipment of Russian liquefied natural gas via France is expected to arrive in New England in February.In the globalizing natural gas markets, we can expect more of these trades. Once, natural gas was primarily a regional resource delivered by land-based pipelines, but in recent years, there has been a rapid growth in the shipping of natural gas in liquefied form across the globe. Indeed, another shipment of Russian liquefied natural gas via France is expected to arrive in New England in February.
If the United States plans to continue imposing sanctions on Russia and its energy sector, it should consider how to approach output from projects like Yamal L.N.G. This is because the original source of such gas will become increasingly difficult to determine as the trade becomes more global. The gas can be loaded and unloaded multiple times and its carrier redirected to various destinations while at sea.If the United States plans to continue imposing sanctions on Russia and its energy sector, it should consider how to approach output from projects like Yamal L.N.G. This is because the original source of such gas will become increasingly difficult to determine as the trade becomes more global. The gas can be loaded and unloaded multiple times and its carrier redirected to various destinations while at sea.
At the same time, the United States should not restrict L.N.G. exports to meet domestic demand. Such exports benefit American allies that have been dependent on imports from hostile state-owned monopolies like Russia’s Gazprom.At the same time, the United States should not restrict L.N.G. exports to meet domestic demand. Such exports benefit American allies that have been dependent on imports from hostile state-owned monopolies like Russia’s Gazprom.
In addition, the federal government and private sector need to reassess the need for pipelines, storage facilities and L.N.G. export terminals as the Midwest and Northeast become powerhouses for natural gas production.In addition, the federal government and private sector need to reassess the need for pipelines, storage facilities and L.N.G. export terminals as the Midwest and Northeast become powerhouses for natural gas production.
Bottlenecks in the natural gas pipeline network this winter led to significant increases in oil-fired and dual-fuel electricity generation to meet energy demands in New England. That development demonstrates the importance, despite grass-roots environmental opposition, of building pipelines connecting the Appalachia gas-producing region — namely the Marcellus and Utica shale gas reserves — with New England markets. Otherwise, New England is likely to continue to have the nation’s highest energy prices and remain dependent on L.N.G. imports and burning oil.Bottlenecks in the natural gas pipeline network this winter led to significant increases in oil-fired and dual-fuel electricity generation to meet energy demands in New England. That development demonstrates the importance, despite grass-roots environmental opposition, of building pipelines connecting the Appalachia gas-producing region — namely the Marcellus and Utica shale gas reserves — with New England markets. Otherwise, New England is likely to continue to have the nation’s highest energy prices and remain dependent on L.N.G. imports and burning oil.
Moreover, Washington and industry need to re-evaluate the 1920 Jones Act, which stipulates that shipping between United States ports must be on American built, registered and crewed vessels. None of the vessels carrying L.N.G. from the Gulf Coast meet this requirement and thus cannot supply New England with domestic gas.Moreover, Washington and industry need to re-evaluate the 1920 Jones Act, which stipulates that shipping between United States ports must be on American built, registered and crewed vessels. None of the vessels carrying L.N.G. from the Gulf Coast meet this requirement and thus cannot supply New England with domestic gas.
President Trump could waive the law during peaks of energy demand as he did for Puerto Rico relief efforts following Hurricane Maria. Ideally, the private sector would launch a fleet of complying American L.N.G. vessels, though operations of American flag vessels tend to be nearly three times more expensive than foreign ones.President Trump could waive the law during peaks of energy demand as he did for Puerto Rico relief efforts following Hurricane Maria. Ideally, the private sector would launch a fleet of complying American L.N.G. vessels, though operations of American flag vessels tend to be nearly three times more expensive than foreign ones.
We also need to end the environmentally and economically costly practice of flaring — the burning off of gas produced as a byproduct of oil and gas extraction that releases carbon dioxide and methane into the atmosphere. Instead, equipment should be installed so that this gas can be collected for use.We also need to end the environmentally and economically costly practice of flaring — the burning off of gas produced as a byproduct of oil and gas extraction that releases carbon dioxide and methane into the atmosphere. Instead, equipment should be installed so that this gas can be collected for use.
These changes would strengthen America’s domestic energy sector, limit calls to curtail America’s L.N.G. exports, reduce the need for imports, and help the country compete with Russia in the global natural gas markets.These changes would strengthen America’s domestic energy sector, limit calls to curtail America’s L.N.G. exports, reduce the need for imports, and help the country compete with Russia in the global natural gas markets.
Policy and infrastructure has not kept pace in the United States as the country has sought to turn into a net exporter of natural gas. But with thoughtful legislation and investments in infrastructure, the United States has the resources, technology and ambition to claim a position as the global leader in the coming golden age of natural gas.Policy and infrastructure has not kept pace in the United States as the country has sought to turn into a net exporter of natural gas. But with thoughtful legislation and investments in infrastructure, the United States has the resources, technology and ambition to claim a position as the global leader in the coming golden age of natural gas.