US DOE Approves LNG Exports from Dominion's Cove Point

The Obama administration on Wednesday authorized natural gas exports from a fourth U.S. facility, speeding up a review process that would-be gas exporters and their allies in Congress had criticized as too slow.

Dominion Resource Inc's conditional permit for liquefied natural gas exports from its Cove Point terminal on Maryland's Chesapeake Bay came just over a month after the Energy Department approved exports from a terminal in Lake Charles, Louisiana.

Dominion's was the fourth natural gas export permit issued by the administration. It was the third permit issued this year, following a pause of nearly two years in review of applications to export gas to all but a handful of countries covered by free trade agreements.

Cove Point's conditional approval to export up to 0.77 billion cubic feet a day of natural gas, pushes the overall amount of gas exports permitted to 6.37 bcf a day.

With domestic production of natural gas booming, about two dozen projects are seeking to send surplus gas abroad. But a group of industrial companies led by Dow Chemical has warned that expanded exports could raise energy prices for domestic consumers.

Elena McGovern, an energy analyst for the Eurasia Group, said the permit "indicates a willingness on the part of the DOE to continue steadily processing pending approvals, rather than take a pause in order to review pricing impacts or other considerations."

About Cove Point

Dominion Cove Point LNG is located on the Chesapeake Bay in Lusby, Maryland, south of Baltimore. It is one of the nation's largest liquefied natural gas (LNG) import facilities.

Dominion acquired Cove Point from Williams on Sept. 5, 2002, and began receiving ships in the summer of 2003. In 2009, Dominion finished an expansion project that increased Cove Point's storage and production capacity by nearly 80 percent. Explore the left-margin links to learn more about the facility and LNG.

Dominion Cove Point will play an increasingly critical role in coming years. Natural gas is the energy of choice for many Americans, and demand is expected to grow through the next decade. Although there are vast reserves of natural gas in the United States, many are not yet available.

Reserves in a number of other countries are available and for sale, but the gas has to be transported. The most efficient way to transport natural gas across the ocean is to liquefy it and transport it in specially built ships. Dominion Cove Point is strategically located where it can receive transport vessels, store the LNG onshore, then transform it back to gas when it is needed to meet demand.

Facility Operation

Dominion Cove Point has a storage capacity of 14.6 billion cubic feet (BCF) and a daily send-out capacity of 1.8 BCF.

The terminal connects, via its own pipeline, to the major Mid-Atlantic gas transmission systems of Transcontinental Gas Pipeline, Columbia Gas Transmission and Dominion Transmission.

Receiving and Storing Gas

LNG pipesLNG arrives at Dominion Cove Point on specially designed LNG transport ships. These vessels transport LNG from various locations in the world, including Trinidad, Nigeria, Norway, Venezuela and Algeria.

At Dominion Cove Point, LNG is off-loaded at an offshore dock, stored for subsequent gasification and then delivered into the pipeline. View a drawing of the process. A single ship can bring about 34 million gallons of LNG — enough to meet the daily energy needs of more than 10 million homes.

LNG is pumped from ships at Dominion Cove Point's offshore dock through a series of pipes to insulated storage tanks.

In addition to linking natural gas supplies from non-U.S. sources with the high-growth natural gas markets in the Mid-Atlantic, Dominion Cove Point is positioned to serve existing Dominion Energy gas-fired generation facilities.

These include Possum Point, Remington, Ladysmith and Fairless Works.

https://maps.google.com/maps?q=Dominion+Cove+Point+Lng+Ltd,+Lusby,+MD&hl=en&ll=38.621162,-76.764221&spn=1.242435,2.469177&sll=38.390883,-76.410985&sspn=0.019476,0.038581&oq=domin&t=h&hq=Dominion+Cove+Point+Lng+Ltd,&hnear=Lusby,+Calvert,+Maryland&z=9&iwloc=A

I think this is Obama’s end game: get everyone focused on using natural gas, convert all extraction, processing, and transport facilities to natural gas so that oil, coal, and their support infrastructure become increasingly more expensive to maintain and operate. Then, at some point, natural gas supplies either get depleted, extraction becomes environmentally unsound (cracking?), and/or government regulation makes it prohibitively expensive for us peons, then it becomes way too expensive to refurbish the oil and coal infrastructure, and we are all either walking or waiting 3 hours on public transportation. Except for the elites, who will be using the government funded transportation paid for by us peons.

How does that increase the cost of O&M for oil and coal?

Then, at some point, natural gas supplies either get depleted,

Maybe in his great, great, great, great, great, great grandchild's lifetime, but not his.

extraction becomes environmentally unsound (cracking?), and/or government regulation makes it prohibitively expensive for us peons

Rising that cost is going on now.

then it becomes way too expensive to refurbish the oil and coal infrastructure

Lots of false assumptions to get to this.

The Cheiniere facility, which was the first one, won't be operational til 2015.

You may recall that in 2002 when they moved to build import facilities, the first gas would arrive in 2008, but actually didn't arrive til 2010. There was no market it for it, so they had to divert it.

As for these exports, they are not to concerned with short term prices. Several of the Japan utilities are taking equity positions in these export consortiums. So the regulators are looking at capacity of each facility and the cumulative capacity. In a sense, they are playing the futures market. That's why Obama hired the new guy, he has a lot of experience as an oil trader. But wait a minute, is fedgov going to be speculating.

Eventually, US oil exports will catch up, and the US will be neither/both an importer and/or an exporter. An energy trading nation. Texas is still the Cross Road of the Western Hemisphere

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