The Rising Influence of Rising Affluence

[zebra4o1]

Dew,

Nice article + annotation.

My favorite LNG company is IOC. They have an on-land project in Papua New Guinea with probably a 10 TCf resource. Much cheaper to develop than these offshore projects. Did a bit of consulting work on one of the Australian offshore projects two years ago, and was appalled at the costs involved.

The main thing that worries my on the Austlian LNG boom now is that at some point there could be big disappointment with the projects based on coal seam gas (CSG).

CSG is a huge investing frenzy in Australia now. Strange as in the US (where it is called coal bed methane), CSG is seen as kind of penny ante. Anyway, must be 5 or 6+ LNG projets in the works now in Queensland Australia based on CSG. Will take about 4000 to 5000 wells to feed each LNG plant. And the wells need to be dewatered to produce gas. So tons of water treatment and disposal issues. Plus huge gathering systems to build and maintain. And CSG is lean, dry gas. No nice gas liquids to help the ecomonics.

In contrast, IOC's plant will be supplied by 4 or 5 wells - they have monster wells.

Other companies I am following in the LNG space are:

Chart Industries (GTLS): makes LNG plant equipment
BG Group: An intergrated focused on LNG
FLEX LNG: Norwegian microcap company planning to make floating LNG plants
Sevan Marine: A bigger Norwegian company with some floating LNG projects. But they mostly make floating oil processing and production platforms.