NGI The Weekly Gas Market Report

Briefs -- Cheniere Energy | Northern Natural Gas | SoCalGas | NextDecade LNG | Swift Energy | Panda Power | Wayne National Forest

Cheniere Energy Inc. has terminated negotiations with the conflicts committee of the board of directors of Cheniere Energy Partners LP Holdings LLC regarding Cheniere's previously announced proposal to acquire all of the publicly held shares of Cheniere Partners Holdings not already owned by Cheniere in a stock-for-stock merger transaction. "After more than six weeks of negotiations, and despite raising the offer to an exchange ratio of 0.54 (representing a premium of approximately 10% over the closing price of Cheniere Partners Holdings' shares based on the closing prices of Cheniere Partners Holdings' shares and of Cheniere's shares as of Sept. 29, 2016...Cheniere has determined that no acceptable definitive agreement can be reached with the conflicts committee at this time," the company said. Cheniere currently owns 80.1% of the issued and outstanding shares of Cheniere Partners Holdings.

Federal Energy Regulatory Commission staff has prepared an environmental assessment (EA) for Northern Natural Gas Co's proposed Cedar Station Upgrade Project in Dakota County, MN [CP16-487]. Northern Natural plans to construct and operate 7.8 miles of 20-inch diameter pipeline from its Rosemont Junction in Rosemont, MN, to the Cedar Station Meter Station in Eagan, which would allow it to increase pressure at the Cedar Station to 650 psig from 400 psig. The project would accommodate a contractual obligation to meet a delivery pressure for Northern States Power Co.'s Black Dog Generating Station, according to Northern Natural. FERC Staff concluded that approval of the project, "with appropriate mitigating measures," would not adversely affect the environment. FERC will accept comments on the EA until Jan. 9.

Southern California Gas Co. (SoCalGas) last Tuesday said its power-to-gas (P2G) hydrogen pipeline injection program at the University of California, Irvine, (UCI) campus has successfully demonstrated the use of excess renewable electricity that would otherwise go to waste, offering the possibility of a major breakthrough for storing renewable-produced power supplies. P2G is a technique for converting surplus clean energy from solar panels or wind farms into hydrogen that subsequently can be blended with natural gas for use in everything from home appliances to major power plants. The renewable fuel can also be converted to methane for use in a natural gas pipeline and storage system or used in hydrogen fuel cell vehicles, a SoCalGas spokesperson said. SoCalGas and UCI research engineers envision the P2G technology providing "significant advantages" over lithium ion batteries in enabling the storage of large amounts of carbon-free power. The Sempra Energy gas utility began funding the pilot project last year with the help of Proton OnSite, provider of an electrolyzer that makes hydrogen from electricity and water.

A unit of liquefied natural gas (LNG) export terminal developer NextDecade LLC and floating LNG developer FLEX LNG are partnering to create solutions for customers wishing to buy LNG from NextDecade's proposed Rio Grande LNG export project in Brownsville, TX. The partners plan to develop floating storage and regasification unit (FSRU) and dockside solutions for international customers of NextDecade. LNG supply is to be provided by NextDecade. "Global interest for NextDecade's U.S.-produced LNG has demonstrated a need for additional and flexible import solutions worldwide," said NextDecade CEO Kathleen Eisbrenner. A heads of agreement stipulates terms for the long-term charter of FLEX LNG FSRUs, connecting customers with a need for regasification import solutions to NextDecade's Rio Grande project. FLEX LNG is developing FSRU solutions that include newbuild vessels as well as conversions of existing LNG carriers.

Swift Energy Co. has sold its remaining 25% interest in the Burr Ferry and South Bearhead Creek Fields in central Louisiana. The approximate $8 million in net proceeds will be used to reduce debt, the company said. "We set out this year to redefine the company and reposition our portfolio through a series of noncore divestitures. We achieved our objective as this transaction effectively concludes our Louisiana divestiture process," said interim CEO Bob Banks. "These transactions to date have simplified our business model as our cost structure is now more representative of our Eagle Ford development program." Swift also recently increased its gas hedge position for 2017 and initiated a hedging program for 2018. For 2018, the company completed 4.4 Bcf of natural gas swaps at an average price of $3.47 for the first quarter of 2018. Recently, Swift announced the sale of its Lake Washington field in southeast Louisiana.

The Susquehanna River Basin Commission (SRBC) has accepted $97,000 in settlement offers from Panda Power Funds LP for violations at three of its natural gas-fired power plants in Pennsylvania. The SRBC, which oversees conservation and monitors industrial development in the area, said the company consumed water in excess of regulatory thresholds at its Panda, Patriot and Hummel power plants; Panda and Patriot were recently commissioned. Hummel, which is one of the country's largest coal-to-gas switching projects, is expected to be in operation by 2018. Panda said permits for the facilities were issued to another developer and did not meet the facilities requirements.

The U.S. Bureau of Land Management (BLM) has accepted bids for about 719 acres across 17 parcels in Ohio's Wayne National Forest. BLMoriginally offered 1,600 acres across 33 parcels, but some of the land was withdrawn. The properties are in the Utica Shale hotbed of Monroe County, OH. A petitionsigned by more than 92,000 people, as well as other administrative protests from environmental groups to stop the auction, were unsuccessful. BLM spokesperson Davida Carnahan said the protest response documents are posted on the agency’s website.

 

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