Europe gas market -how it started how its going

[ronwagn + 6,290]

9 hours ago, Eric Gagen said:

There aren’t enough LNG ships in the world  and regassification terminals in Europe to do that.  It is enough to make a major dent in the situation though.  It would not be enough to ‘save’ European industry over the winter but it would probably be enough to prevent anyone from freezing to death.  

I think the logical thing is to look at all the other worldwide sources of LNG and piped natural gas plus other fuel sources of which there are several. Coal, wind, solar, wood, wood pellets, oil, gasoline etc. There are many other ships that can deliver those too. Europe can buy from many sources. The stupidity of the greenies is that they are opposing fossil fuels right now in the midst of this crisis. 

[Boat + 1,315]

4 hours ago, ronwagn said:

I think the logical thing is to look at all the other worldwide sources of LNG and piped natural gas plus other fuel sources of which there are several. Coal, wind, solar, wood, wood pellets, oil, gasoline etc. There are many other ships that can deliver those too. Europe can buy from many sources. The stupidity of the greenies is that they are opposing fossil fuels right now in the midst of this crisis. 

I think you just throw those statements out there without proof. I consider myself a greenie but do not want renewables replacing Coal for example unless they are cost competitive. I just want the health and environmental costs to be factored in when making the decision. With Putin as a supplier I would choose both nuclear and coal instead of imports as much as possible. Same with Iran. These countries have a history of being unstable, threatening and being ideology driven. Europe surprised the world with its fear of nuclear having more consideration than its fear of Putin causing mischief in land grabs and market manipulation. True that both have a steady bad reputation but nuclear gets you closer to energy independence. 
 

[Michael Sanches + 187]

Which currency will become the reserve currency if the US goes through Redenomination? With the national debt at $29 trillion and increasing $1 trillion every 2 months, hyperinflation is around the corner.

Even the Thai Baht is rising compared to the dollar.

[Michael Sanches + 187]

Because of the Carpathian mountains, Russia has a strong interest in Ukraine.

We need to be careful about looking too weak. Germany could have ruled Europe if there was no WW2. One sllght miscalculation resulted in 60 million dead. Oopsie! Being right is small consolation if you are dead.

At this point, I see:

1. Russia can steamroll over any part or all of Ukraine.

2. Europe will not choose freezing over cooperation with Russia, if Russia gives a big enough lie.

[Eric Gagen + 713]

6 hours ago, ronwagn said:

I think the logical thing is to look at all the other worldwide sources of LNG and piped natural gas plus other fuel sources of which there are several. Coal, wind, solar, wood, wood pellets, oil, gasoline etc. There are many other ships that can deliver those too. Europe can buy from many sources. The stupidity of the greenies is that they are opposing fossil fuels right now in the midst of this crisis. 

For Europe right now, any liquid or solid fuels like coal, wood, oil, etc. are of very limited utility - they don't have any spare facilities to burn them in.  In theory they could convert some of the natural gas plants to burn oil, but even at current prices natural gas is still cheaper than oil on an energy basis, so it would be horrifically expensive.  It would probably be cheaper just to idle heavy industries until you don't need to burn any significant amounts of oil for electricity.  

[Andrei Moutchkine + 828]

5 hours ago, Michael Sanches said:

Because of the Carpathian mountains, Russia has a strong interest in Ukraine.

We need to be careful about looking too weak. Germany could have ruled Europe if there was no WW2. One sllght miscalculation resulted in 60 million dead. Oopsie! Being right is small consolation if you are dead.

At this point, I see:

1. Russia can steamroll over any part or all of Ukraine.

2. Europe will not choose freezing over cooperation with Russia, if Russia gives a big enough lie.

What about Carpathian mountains? There is nothing there.

[Eric Gagen + 713]

17 minutes ago, Andrei Moutchkine said:

What about Carpathian mountains? There is nothing there.

The mountains are there, and from a strategic perspective that makes them important. If you are Russia, and hold those mountains, then it's a source of security from invasion along the southwestern front of Europe. By contrast, if you are western and central Europe, if you hold them,  any potential threat or invasion of Russia is much simpler.  As a general sort of thing, whoever controls that region has the geostrategic initiative in central Europe as a whole, because your side has a lot more military options than the other side.  That's been the case since the rise of the Roman empire around 0 AD. 

[NickW + 2,714]

21 hours ago, Eric Gagen said:

There aren’t enough LNG ships in the world  and regassification terminals in Europe to do that.  It is enough to make a major dent in the situation though.  It would not be enough to ‘save’ European industry over the winter but it would probably be enough to prevent anyone from freezing to death.  

The possible way round this would be to suspend carbon trading and allow run coal plants to run flat out - that assumes of course enough coal is available on world markets. Not sure how much flex capacity the US and Canadian industries have. Also South Africa & Columbia. 

Also many CCGT plant will run on fuel distillate as a back up . Given oil prices are low compared to gas thats an option in some circumstances. 

Edited January 26, 2022 by NickW

[Andrei Moutchkine + 828]

56 minutes ago, Eric Gagen said:

The mountains are there, and from a strategic perspective that makes them important. If you are Russia, and hold those mountains, then it's a source of security from invasion along the southwestern front of Europe. By contrast, if you are western and central Europe, if you hold them,  any potential threat or invasion of Russia is much simpler.  As a general sort of thing, whoever controls that region has the geostrategic initiative in central Europe as a whole, because your side has a lot more military options than the other side.  That's been the case since the rise of the Roman empire around 0 AD. 

They are very shallow. So shallow, that you don't notice anything from the ground.

[Eric Gagen + 713]

35 minutes ago, NickW said:

The possible way round this would be to suspend carbon trading and allow run coal plants to run flat out - that assumes of course enough coal is available on world markets. Not sure how much flex capacity the US and Canadian industries have. Also South Africa & Columbia. 

Also many CCGT plant will run on fuel distillate as a back up . Given oil prices are low compared to gas thats an option in some circumstances. 

They don't have those coal plants any more.  When they stopped using them, they didn't (mostly) sit there waiting for a rainy day.  They got decommissioned, dismantled and scrapped.  The remaining plants in service ARE running as much as they can at least so far as I understand it.

https://ec.europa.eu/jrc/sites/default/files/factsheet_on_eu_trends_coal_peat_oil.pdf

Total nameplate capacity of existing coal plants in EU Europe is 112 MWh as of 2018.  Total electric demand is on average 315 MWh.  typically those coal plants cover 20% (63 MWh) at a55% utilization capacity.  By running flat out burning as hard and fast as possible at 90% utilization (you can't get to and stay at 100% for long durations) you can get ~ 100 MWh out of those plants, representing nearly 1/3rd of demand.  That's the best you can do.  

As per this source, the EU mines ~ 440 million MT of coal a year, and imports~ 96 million MT of coal a year as per here: https://www.statista.com/statistics/1260337/eu-coal-import-volume/#:~:text=Coal imports into the European,coal imports peaked in 2006. Assuming it's all burnt in electric power stations, that's a total demand of 536 million MT a year.  To go from the 63 MWh production level to 100 MWh level takes an extra 59% more coal - about 316 million MT a year extra for a total import level of 412 MT a year.  

Looking only at the US, it currently exports ~ 100 million MT of coal a year, and keeps another 500 million MT for domestic use.  https://www.spglobal.com/platts/en/market-insights/latest-news/coal/011221-us-2021-coal-production-expected-to-rise-156-on-year-eia  However these numbers are all demand constrained - as recently as 2018 the US was producing 800 million MT of coal (it's been as high as 1,100 million MT a year within the last 10 years) Those are mines which are on short hours, or idled due to lack of demand - not because they are depleted, so it could easily meet the whole of the EU demand by itself.  Shipping and logistics would be a nightmare, but it could be done.  

Edited January 26, 2022 by Eric Gagen

[Eric Gagen + 713]

11 minutes ago, Andrei Moutchkine said:

They are very shallow. So shallow, that you don't notice anything from the ground.

are we talking about the same mountains?  The eastern Carpathians are generally 2000 meters or so high in western Ukraine and eastern Romania - I think that qualifies as noticeable (roughly from the  h in carpathian to the s in mountains on the arc between Ukraine and Romania) 

[NickW + 2,714]

33 minutes ago, Eric Gagen said:

They don't have those coal plants any more.  When they stopped using them, they didn't (mostly) sit there waiting for a rainy day.  They got decommissioned, dismantled and scrapped.  The remaining plants in service ARE running as much as they can at least so far as I understand it.

https://ec.europa.eu/jrc/sites/default/files/factsheet_on_eu_trends_coal_peat_oil.pdf

Total nameplate capacity of existing coal plants in EU Europe is 112 MWh as of 2018.  Total electric demand is on average 315 MWh.  typically those coal plants cover 20% (63 MWh) at a55% utilization capacity.  By running flat out burning as hard and fast as possible at 90% utilization (you can't get to and stay at 100% for long durations) you can get ~ 100 MWh out of those plants, representing nearly 1/3rd of demand.  That's the best you can do.  

As per this source, the EU mines ~ 440 million MT of coal a year, and imports~ 96 million MT of coal a year as per here: https://www.statista.com/statistics/1260337/eu-coal-import-volume/#:~:text=Coal imports into the European,coal imports peaked in 2006. Assuming it's all burnt in electric power stations, that's a total demand of 536 million MT a year.  To go from the 63 MWh production level to 100 MWh level takes an extra 59% more coal - about 316 million MT a year extra for a total import level of 412 MT a year.  

Looking only at the US, it currently exports ~ 100 million MT of coal a year, and keeps another 500 million MT for domestic use.  https://www.spglobal.com/platts/en/market-insights/latest-news/coal/011221-us-2021-coal-production-expected-to-rise-156-on-year-eia  However these numbers are all demand constrained - as recently as 2018 the US was producing 800 million MT of coal (it's been as high as 1,100 million MT a year within the last 10 years) Those are mines which are on short hours, or idled due to lack of demand - not because they are depleted, so it could easily meet the whole of the EU demand by itself.  Shipping and logistics would be a nightmare, but it could be done.  

Most the coal plants are run as peakers due to carbon pricing. For example right now (at peak demand)  the UK is running 1.7 out of 5.2GW. Germany is running 26 out of 44, Span 0.8 out of 3.8GW. 

If you can get the coal and run these as baseload (as they should be) and use gas for peaking then that would massively reduce gas consumption. Of course the other issue is supply chain - sourcing the coal and having the handling facilities to transport to the power stations.

[Eric Gagen + 713]

27 minutes ago, NickW said:

Most the coal plants are run as peakers due to carbon pricing. For example right now (at peak demand)  the UK is running 1.7 out of 5.2GW. Germany is running 26 out of 44, Span 0.8 out of 3.8GW. 

If you can get the coal and run these as baseload (as they should be) and use gas for peaking then that would massively reduce gas consumption. Of course the other issue is supply chain - sourcing the coal and having the handling facilities to transport to the power stations.

yep - that's reflected in the overall 55% capacity utilization - I am guessing that is heavily skewed by Poland which is all coal all the time, every day.  Which is the other problem with "Burn all the Coal!!" as a solution to the EU natural gas problem -  the existing coal plants are heavily concentrated in and around Poland, Eastern Germany, Czech and Slovakia - there aren't enough interconnects from them  to easily make up the difference elsewhere. 

[NickW + 2,714]

26 minutes ago, Eric Gagen said:

yep - that's reflected in the overall 55% capacity utilization - I am guessing that is heavily skewed by Poland which is all coal all the time, every day.  Which is the other problem with "Burn all the Coal!!" as a solution to the EU natural gas problem -  the existing coal plants are heavily concentrated in and around Poland, Eastern Germany, Czech and Slovakia - there aren't enough interconnects from them  to easily make up the difference elsewhere. 

There is no silver bullet solution its all about chipping away at the issue to reduce reliance on russian gas. . Up coal usage, switch some CCGT to using fuel distillate, try and encourage fuel conservation etc. 

Edited January 26, 2022 by NickW

[ronwagn + 6,290]

9 hours ago, Boat said:

I think you just throw those statements out there without proof. I consider myself a greenie but do not want renewables replacing Coal for example unless they are cost competitive. I just want the health and environmental costs to be factored in when making the decision. With Putin as a supplier I would choose both nuclear and coal instead of imports as much as possible. Same with Iran. These countries have a history of being unstable, threatening and being ideology driven. Europe surprised the world with its fear of nuclear having more consideration than its fear of Putin causing mischief in land grabs and market manipulation. True that both have a steady bad reputation but nuclear gets you closer to energy independence. 
 

I have shifted to an all of the above policy from promoting only natural gas. I am for anything that will meet energy needs at a good price. Depending on Russia or any unreliable and untrusted source entails a very high cost of a basic nature. Being a realistic green is totally acceptable to me. We should all want the cleanest emissions possible. The price and availability are vital however.

[ronwagn + 6,290]

9 hours ago, Michael Sanches said:

Which currency will become the reserve currency if the US goes through Redenomination? With the national debt at $29 trillion and increasing $1 trillion every 2 months, hyperinflation is around the corner.

Even the Thai Baht is rising compared to the dollar.

Personally, I think our pennies and nickels should be done away with, just round prices off. It would average out. See: The Cost of Coinage in America

 https://docs.google.com/document/d/12xIe1zAKluuzT3dnTqx_LyuoihSfz0JTDl6lCvHRDdc/edit

Please tell me which economies that you think are the strongest and not on the inflationary slide? Switzerland, Austria, Germany?

Edited January 26, 2022 by ronwagn

[Andrei Moutchkine + 828]

2 hours ago, Eric Gagen said:

are we talking about the same mountains?  The eastern Carpathians are generally 2000 meters or so high in western Ukraine and eastern Romania - I think that qualifies as noticeable (roughly from the  h in carpathian to the s in mountains on the arc between Ukraine and Romania) 

Yes. When you cross the border in

https://en.wikipedia.org/wiki/Mukachevo

you don't really notice it is on elevated ground. Elsewhere, they do supposedly have a whole ski resort now, but I haven't been.

Edited January 26, 2022 by Andrei Moutchkine

[ronwagn + 6,290]

On 12/30/2021 at 5:34 PM, NickW said:

The irony being this has made wind and solar (by cost per kwh) super competitive even for offshore wind*

The strike price on European offshore wind (either Belg or the Netherlands) was 6.7c /  Kwh

Gas was trading on the dutch hub at 9.5c/kwh today. 

 

Piped natural gas is very reasonable in price. The world needs a lot more pipelines. LNG is more expensive but there is a need for many more LNG tankers and other infrastructure. Natural gas is as clean as it gets IMO. 

There is an abundance of natural gas fields around the world. They need to be developed. Here is the best solution to speed things up. Aside from convincing Biden to support production of fossil fuels. 

https://www.oilandgasiq.com/fpso-flng/articles/guide-to-flng

 

[Eric Gagen + 713]

36 minutes ago, Andrei Moutchkine said:

Yes. When you cross the border in

https://en.wikipedia.org/wiki/Mukachevo

you don't really notice it is on elevated ground. Elsewhere, they do supposedly have a whole ski resort now, but I haven't been.

Based on the maps I can see, Mukachevo is west of the Carpathians at 125 meters elevation so that's not surprising - you haven't gotten to them yet there. However 25 km to the east is a mountain over 1,650 meters elevation, marking the western edge of the Carpathians from there.  The mountains aren't ON the border at all. 

[NickW + 2,714]

1 hour ago, Andrei Moutchkine said:

Yes. When you cross the border in

https://en.wikipedia.org/wiki/Mukachevo

you don't really notice it is on elevated ground. Elsewhere, they do supposedly have a whole ski resort now, but I haven't been.

Mukachevo is on the Hungarian Plain, not in the Carpathians. 

[Tomasz + 1,608]

Did the Soviet Union ever stop shipping gas to Western Europe, even during the greatest crises of the Cold War?

NO

Anyway, Russia has very good relations with Germany and especially France and Italy.

Last year, 29 Novatek's gas tankers supplied LNG to the UK.

The only problem is that the USA has a big problem because your LNG from the USA is much more expensive than Russian gas.

The US is already really doing all the ways to force Europe to buy its expensive gas.

Only that Europe knows well how to calculate what it cost and which one is cheaper.

if Russia did not have nuclear weapons, the US would have imposed sanctions on Russia on gas exports a whole long time ago.

As are sanctions on the oil sectors of Iran and Venezuela.

The USA simply doesn't like competition to its businessmen.

And the interests of Europe would be deeply respected by the ground that exports from the USA would increase because this is the problem that the USA has fewer and fewer products at the price that  someone wants to buy.

[NickW + 2,714]

On 1/28/2022 at 1:07 AM, Tomasz said:

Did the Soviet Union ever stop shipping gas to Western Europe, even during the greatest crises of the Cold War?

NO

Anyway, Russia has very good relations with Germany and especially France and Italy.

Last year, 29 Novatek's gas tankers supplied LNG to the UK.

The only problem is that the USA has a big problem because your LNG from the USA is much more expensive than Russian gas.

The US is already really doing all the ways to force Europe to buy its expensive gas.

Only that Europe knows well how to calculate what it cost and which one is cheaper.

if Russia did not have nuclear weapons, the US would have imposed sanctions on Russia on gas exports a whole long time ago.

As are sanctions on the oil sectors of Iran and Venezuela.

The USA simply doesn't like competition to its businessmen.

And the interests of Europe would be deeply respected by the ground that exports from the USA would increase because this is the problem that the USA has fewer and fewer products at the price that  someone wants to buy.

The lesson from this if a Country or collection of countries are highly reliant on imports don't become overly reliant on one imported fuel and diversify suppliers. 

 

[Andrei Moutchkine + 828]

2 hours ago, NickW said:

The lesson from this if a Country or collection of countries are highly reliant on imports don't become overly reliant on one imported fuel and diversify suppliers. 

 

...and you do that before you start heaping abuse on that one supplier you are reliant upon.

[Starschy + 211]

On 1/26/2022 at 8:45 PM, ronwagn said:

Personally, I think our pennies and nickels should be done away with, just round prices off. It would average out. See: The Cost of Coinage in America

 https://docs.google.com/document/d/12xIe1zAKluuzT3dnTqx_LyuoihSfz0JTDl6lCvHRDdc/edit

Please tell me which economies that you think are the strongest and not on the inflationary slide? Switzerland, Austria, Germany?

By fare the Swiss. They have a large Securities Portfolio from US and a signifikant Gold level in the Top 7. Interest is under very strong control. The inflation will be lower as production of Steel Aluminium is low and Heating and Energy saving is since 30 years on the Main Agenda.

[Andrew Neopalimy + 14]

Can Europe survive painlessly without Russian gas?

If Russian gas stops flowing, measures to replace supply won’t be enough. The European Union will need to curb demand, implying difficult and costly decisions.

https://www.bruegel.org/2022/01/can-europe-survive-painlessly-without-russian-gas/

Russia has historically been the European Union’s largest supplier of natural gas. After the 2006 and 2009 Russia-Ukraine-Europe gas disputes, followed by tensions in the wake of the 2013-14 Ukrainian crisis, the EU has sought to reduce its dependency on Russian natural gas imports. However, Russia continues to supply around 40% of EU gas consumption (Figure 1).

......

Summary

Until the summer, the EU would likely be able to survive large-scale disruption to Russian gas supplies, based on a combination of increased LNG imports (to the limited extent this is technically possible) and demand-side measures such as industrial gas curtailments. However, this would come at a cost for the EU economy and might even result in some countries (those more exposed to Russian gas and less interconnected with other EU countries) having to take emergency measures.

But, should a halt of Russian gas be prolonged into the next winters, it would be more difficult for the EU to cope. On the supply side some spare import capacity is available but reaching the scale required to entirely replace Russian volumes would be at best very expensive, and at worst physically impossible. Limiting factors include global liquefaction capacity constraints, existing obligations in the current LNG market and commercial opportunity considerations in producing countries in relation to diverting shipments away from Asia. There would also be pricing implications and second-round effects on the poorest countries. The EU would thus need to resort to demand-side measures, which would prove painful for different countries/constituencies. This will raise questions on how to fairly share the burden. Difficult and costly decisions would have to be taken to manage the situation in an orderly way.