Lithium is in high demand worldwide for the production of rechargeable batteries used in the rapidly expanding electric vehicle (EV) and utility-scale energy storage markets, as well as a plethora of everyday mobile devices. The problem is, there are relatively few places on the planet that offer rock formations or naturally occurring underground brine reservoirs conducive to the economic production of lithium — and even there the concentrations of lithium in the rock and brine are measured in parts per million. Now, a handful of companies in Alberta and elsewhere are exploring the potential for “direct lithium extraction” from oil and gas well brine, an alternative technique that some view as a potential breakthrough. In today’s RBN blog, we discuss the promise — and potential pitfalls — of lithium production from oil and gas brine.
Daily Energy Blog
The swift increases in crude oil and gasoline prices that followed Russia’s invasion of Ukraine in February — and the sanctions that were implemented soon thereafter — spurred a lot of concern that the U.S. and global economies would go into a tailspin. In response, government officials here and abroad turned to their strategic reserves as a way to quickly balance the market and rein in prices while buying time for additional oil production to come online. But U.S. production growth and rig activity have hit a wall since June, when releases from the Strategic Petroleum Reserve (SPR) started to pick up steam, reducing the prospects for a significant output increase this year. In today’s RBN blog, we examine the changes in the market since the major withdrawals were announced, how the hoped-for bridge to higher oil production has so far failed to materialize, and why it’s unlikely the government will turn to the SPR if prices spike again soon.
By all appearances, the momentum behind electric vehicles (EVs) has done nothing but increase over the last year, boosted by higher gasoline prices and federal legislation intended to speed the pace of EV adoption. But the transportation sector's transition to electric power and away from the internal-combustion engine (ICE) won't be easy, and may take a lot longer than many expect or hope, due in part to the significant challenges in finding the hard-to-come-by metals and other materials needed for EV production. In today’s RBN blog, we look at the continuing focus on EVs, China’s current dominance in the global market, and how the newly passed Inflation Reduction Act (IRA) is boosting plans to make EV batteries in the U.S.
It’s hard to think of a $5.2 billion acquisition as a “bolt-on,” but that’s what EQT Corp. — the U.S.’s #1 natural gas producer — is calling its recently announced purchase of Tug Hill’s gas production assets and XcL Midstream’s pipeline and processing assets in northern West Virginia. The deal, which represents the largest acquisition in the Marcellus/Utica Shale in five years, will not only give EQT even more scale in the nation’s leading gas-and-NGLs production region, it also will lower EQT’s breakeven gas price and its emissions intensity. Oh, and with the deal, EQT is doubling its share-repurchase authorization and increasing its year-end-2023 debt-reduction goal by 60%. In today’s RBN blog, we examine and assess these and other aspects of the agreement.
In days gone by, the common sentiment in the oil patch when prices rose was “Drill, baby, drill!” Not only have times changed, but even back when the phrase was made famous by former Republican Vice-Presidential nominee Sarah Palin in 2008 it vastly oversimplified and understated the efforts required to secure new production. It’s easy to overlook how intensive (and time-consuming) the operation at a well site is before even being able to extract any of those precious crude oil, natural gas and NGL molecules found beneath our feet. Prior to hydrocarbon production, well sites must be obtained, tested and developed by exploration and production companies trying to determine their chances of making a reasonable return on their investment. In today’s RBN blog, we take a step-by-step look at the leasing process.
The recently passed Inflation Reduction Act (IRA) offers a lot of incentives, mostly in the way of tax credits, to advance the Biden administration’s clean-energy initiatives and reduce greenhouse gas (GHG) emissions. There are inducements for everything from carbon capture and electric vehicles to renewable energy and hydrogen production, but very few penalties. One exception is included in the new law’s Methane Emissions Reduction Program (MERP), which features the federal government’s first-ever fee on the emissions of any GHG. In today’s RBN blog, we look at recent attempts to mitigate methane emissions, how the new methane charge will work, and how it could one day be replaced by new federal rules.
Last week, the U.S. Department of Energy (DOE) unveiled its timeline for receiving and reviewing proposals to develop six to 10 clean-hydrogen hubs and said its aim was to decide by the fall of next year which projects will share up to $7 billion in DOE support. The competition for those dollars is sure to be fierce, with some of the strongest proposals likely to come from states like Texas and California that have a lot of renewable energy and ambitions to be leaders in the energy transition. Also, there is a joint effort by three states east and north of Texas to develop a hydrogen hub that would take advantage of their existing and planned hydrogen-production and wind assets, natural gas supply, refinery and pipeline infrastructure, and carbon sequestration potential. In today's RBN blog, we discuss the DOE's recent announcement and the three-state hydrogen-hub plan, which is dubbed H2ALO.
The world needs more LNG and the U.S. is answering that call. Two U.S. liquefaction projects, Venture Global’s Plaquemines LNG and Cheniere’s Corpus Christi Stage III, have already reached a final investment decision (FID) on a combined 23.3 MMtpa (3.1 Bcf/d) of export capacity, which will be online by mid-decade. But by the looks of it, we are just getting started. Next up could be NextDecade’s Rio Grande LNG, which has sold 75% of its first two trains’ capacity — enough to take FID, possibly by the end of the year. If it moves forward, not only will the project add another 10.8 MMtpa (1.43 Bcf/d) or more of export capacity to the Gulf Coast, it could also come with a new carbon capture and sequestration (CCS) facility, which has long been a selling point for the project. In today’s RBN blog, we continue our series on the U.S. LNG projects most likely to move forward, this time with a look at Rio Grande LNG.
The battle to restore energy reliability in Europe has breathed new life into North American LNG export projects — and into the Haynesville Shale in Louisiana, the closest supply basin to many of the planned and proposed liquefaction facilities. Gas production in the region has climbed more than 4 Bcf/d — an impressive 39% — since 2019 and we expect it to grow nearly as much over the next three years. The big question on everyone’s mind, however, is whether there will be enough pipeline capacity to move that gas to where it’s needed on the coast. Pipeline capacity for southbound flows through the Bayou State is already showing signs of stress. Will recently completed and upcoming debottlenecking projects help stave off major supply and pricing disruptions? In today’s RBN blog, we provide our outlook on Haynesville production and the nature and timing of Gulf-bound pipeline projects.
There finally seems to be some momentum building for additional LNG export projects on Canada’s West Coast. Major pipeline and midstream operator Enbridge announced in late July that it was making an investment in Woodfibre LNG, a smaller-scale export project that has already come a long way in terms of approvals, pipeline connections, locking up gas supplies, and initial financing. With the Enbridge announcement — and the financial and technical clout the company brings to the table — it is now looking assured that the project will commence construction next year and be exporting LNG by 2027. In today’s blog, we take a detailed look at Woodfibre LNG.
Economic sanctions can be a powerful tool to punish a country or group, especially if they involve an essential commodity like crude oil. Imposed for a variety of reasons (military, political, social), sanctions can cause serious harm to the targeted entity. But levying them effectively is not as simple as it may seem, and even the most well-intentioned plans can fall short or have unintended consequences or backfire altogether. In today’s RBN blog we look at a plan by the U.S. and its allies to limit the price of Russian crude oil and the significant challenges in designing a cap that is effective and enforceable.
It’s been another tumultuous few months for natural gas prices, particularly amid what European Commission President Ursula von der Leyen has called Russia’s war on Europe’s energy and economy. Europe is staring down aggressive curtailments of Russian gas supplies and rising consumer utility bills, necessitating austerity measures and beyond to bail out consumers and utilities and prevent a dangerous shortfall this winter. Prices in continental Europe have now topped $20/MMBtu for a year, higher than the previous single-day record. On top of the elevated prices, outrageous spikes higher and lower have become a semi-regular occurrence as the gas market struggles to find balance. And high prices and volatility are not going anywhere anytime soon as Europe braces for a winter with little or even no Russian gas. In today’s RBN blog we look at European gas prices, the latest energy policy proposal from the EC and how U.S. LNG exports fit into the ongoing crisis.
The high cost of gasoline and diesel and their impact on inflation and the global economy has been a major market development this year, with the blame typically being cast on politicians, oil producers and policies intended to limit development of traditional energy resources and encourage decarbonization — and sometimes all of the above. Prices have retreated in recent weeks amid lower consumer demand and worries about the state of the global economy, but long-term concerns about global refining capacity and the possibility of another price spike remain. In today’s RBN blog, we discuss highlights from our new Drill Down Report on the state of global refining.
Lower 48 natural gas production this month hit a once-unthinkable milestone, topping the all-important psychological threshold of 100 Bcf/d for the first time. Volumes have remained at record highs through mid-September, with year-on-year gains expanding to a breathtaking 7-9 Bcf/d above last year at this time (when hurricane-related shut-ins were in effect). The record production levels coincided with a seasonal decline in weather-related demand, as well as the ongoing outage at the Freeport LNG export terminal. Remarkably, however, even with all-time high, ~100 Bcf/d natural gas production and Freeport LNG offline, the Lower 48 gas market balance averaged tighter year-on-year — a testament to just how strong consumption has been lately, and for much of this summer for that matter. In today’s blog, we look at how the supply-demand balance has shaped up this month and where it’s headed near-term.
What has been the most controversial topic in the U.S. refining industry over the last 10 years? Well, it’s a matter of opinion but, judging from time spent in earnings conference calls, law offices, courtrooms, congressional committees, the White House, and other forums of business and political debate, Renewable Identification Numbers — or RINs — would have to be a top contender for that prize. In today’s RBN blog and the final episode of this series, we consider two differing viewpoints on the effects of the RIN system and specific disagreements — or are they misunderstandings? — about the financial consequences of RINs that have dominated the debates and legal cases.
