Energy Exports Outlook - LSU Center for Energy Studies

Energy Summit 2014
The Future of Louisiana Energy
Energy Exports Outlook
Frank J. Macchiarola
Executive Vice President, Government Affairs
October 22, 2014 – LSU Center for Energy Studies
Baton Rouge, LA
Abundant Supply
Estimates of U.S. Recoverable Natural Gas
(trillion cubic feet)
Proved
Reserves
4,000
Potential Shale
Gas Resources
Non-shale Gas
Resources
Total Resource
(Uncategorized)
3,600
3,545
3,350
3,105
3,000
2,836
2,688
2,543
2,335
2,074
2,203
2,170
2,102
2,100
1,981
2,000
1,619
1,532
1,414
1,268
1,312
1,235
1,000
0
‘00 ‘02 ‘04 ‘06 ‘08 ’10 ‘12
Potential Gas Committee
’08 ‘09 ‘10 ‘11 ’12 ‘13
EIA
‘10 ‘10
‘11 ‘11
CERA, MIT NPC, INGAA
‘09 ’12 ‘13
ICF
Fundamental Change in the Game
U.S. Natural Gas Production
40
35
tcf
(trillion cubic feet per year)
2012
Historic
Projected
30
25
20
Shale Gas
41%
15
Tight Gas
23%
21%
10
7%
5
54%
16%
9%
1%
5%
Coalbed Methane
Non-associated Onshore
Associated with Oil
Alaska
Non-associated Offshore
5%
4%
5%
3%
6%
0
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040
Note: Dry production (marketed production minus extraction losses & associated offshore)
Source: EIA Annual Energy Outlook: 2014
Fewer Rigs, More Production
27
1600
1400
25
23
1000
21
800
600
19
400
17
200
15
0
12 mo Dry Marketed Production
Source: EIA ‐ 12 Month Rolling Average of Production and Demand,
Baker Hughes ‐ 12 month Rolling Average of Rig Count
12 mo Demand
12 mo Gas Rigs
Rig Count
Trillion Cubic Feet
1200
Haynesville Production
Natural Gas Production Per Rig
MCF/D
6,000
5,000
4,000
3,000
2,000
1,000
‐
2007
2008
Source: EIA Drilling Productivity Reports
2009
2010
2011
2012
2013
2014
Natural Gas Production (TCF): Reference
40
AEO Projection Range:
AEO 2009 ‐ AEO 2014
35
30
25
20
AEO 2013
15
AEO 2014
U.S. Production
10
2000
2005
2010
2015
2020
2025
2030
2035
The maximum bound is AEO 2014 ER, the average production in years 2014‐2035 is 47% more than the minimum bound average production from the AEO 2010 and is 10% higher than AEO 2013.
Can We Meet Added Demand?
US and Canadian Reserves
Current U.S. Consumption: 25 TCF
Reserves < $5.00; 2013 technology: 1,500 TCF
Technically Recoverable Reserves 2013 technology: 4,000 TCF
Source: EIA, ICF
ANGA Demand Focus
• Power Generation
• Transportation
• Manufacturing
• LNG Exports
• Supply Protection
Natural Gas Demand Growth
U.S. Natural Gas Demand
(billion cubic feet per day)
100
90
Historic
Projected
LNG
Exports
Transportation
80
70
60
50
Electric Power
40
30
20
10
Pipeline
Exports
Industrial
Commercial
Residential
0
Projected Data Source: EIA Annual Energy Outlook: 2014
Historic Data Source: EIA Natural Gas Monthly, April 2014
LNG Exports - Paradigm Shift C
Natural Gas Net Imports
(trillion cubic feet)
10
AEO 2005
8
6
AEO 2005
4
2
Actual
AEO 2013
Imports
0
Exports
-2
Historic
-4
1973
Source:
1983
1993
2003
2013
EIA, Annual Energy Outlook 2005 & 2013 Early Release
Projected
2023
AEO 2014 ER
2033
LNG Export Study Comparison
LNG % Price Exports Price Change Change U.S. Natural LNG Export Levels Volume from from Price Timeline, Gas Supply Assumed or Solved Range Reference Reference Location
Assumption*
For?
(Bcf/d)
Case Case 2016‐2030 Avg, High
Assumed
4.0 ‐ 16.0 $0.32 ‐ $1.02 7% ‐ 21%
Henry Hub
Modeler Sponsor Release Date
ICF
API
May, 2013
CRA
Dow
February, 2013
2030, Henry Hub
Low
Assumed
20.0 ‐ 35.0 $1.60 ‐ $3.10 22% ‐ 43%
NERA
DOE
December, 2012
2035, Well‐head
Reference
Solved (w/ & w/o constraints)
0.0 ‐ 15.8 $0.00 ‐ $1.09 0% ‐ 17%
NERA
DOE
December, 2012
2035, Well‐head
High
Solved (w/ & w/o constraints)
6.0 ‐ 23.0 $0.28 ‐ $1.09 6% ‐ 22%
NERA
DOE
December, 2012
2035, Well‐head
Low
Solved (w/ & w/o constraints)
0.0 ‐ 1.4 $0.00 ‐ $0.16 0% ‐ 2%
Navigant
Jordan Cove
January, 2012
2035, Henry Hub
Reference
Solved (w/ constraints)
0.9 ‐ 6.6
$0.04 ‐ $0.41
1% ‐ 7%
2011
2035, U.S. Average
Reference
Assumed
6.0
$0.22
3%
Deloitte
* Relative to EIA supply assumptions
Window of Opportunity
140
120
Proposed U.S. Capacity 2
100
Bcf/d
80
60
Under Construction, Planned & Proposed Non‐
U.S. World Capacity 3
Range in Projected Worldwide LNG Demand: 2020‐
2025~
40
Current World Capacity 1
20
0
1. ICF estimate for year end 2011.
2. FTA & non‐FTA Applications to DOE as of Mar 31, 2014 3. Dec 2012 ICF estimate based on current worldwide project list.
~Poten, BG Group, Credit Suisse, Facts Global
Source: API, ANGA
LNG Exports Timeline
Senate Energy Committee Hearing
H.R. 6 Passes House of Representatives
FERC Approves Freeport LNG
DOE Finalized Changes in Export Approval Process
2014
Future FERC/DOE Approvals
Sabine Pass Online
2015
Possible Senate Action
Think About It
Frank J. Macchiarola
Executive Vice President, Government Affairs
[email protected]
701 8th Street NW
Washington D.C. 20001
202.789.ANGA
anga.us

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