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Saturday, June 3, 2017

Does Australia have the world's silliest mining industry?

Setting a new benchmark in silliness, the Australian mining industry made not one, not two, but three laughable media releases last month.

On 11 May 2017 Minerals Council of Australia made a bold "projection" on the future of coal mining in Australia. The "projection" made from data from the Resources and Energy March Quarterly of a government department report was that the coal industry had a great future - at least until 30 June 2017 - when the value of exports of thermal and metallurgical coal was expected to be almost $55 billion.

Not many investment decisions are made on the basis of a "projection" of the final two months of the current fiscal year. On this "projection" the Minerals Council of Australia made the silly declaration: "Myth 1 Australia's thermal coal exports are in decline...BUSTED "

The Resources and Energy March Quarterly the Minerals Council of Australia thought worthy of quoting contains real projections for the value of Australia's coal exports to 2021-22.

Those projections show a dramatic decline from the peak of $55 billion in 2016-17 to just $39.8 billion in 2021-22.
Australia's metallurgical coal exports

Australia's thermal coal exports

On 17 May 2017 Minerals Council of Australia issued another media release with the puzzling title "New Report: Low emission coal technology key to growth in South-East Asia".
What is puzzling about this title is that a report referenced in the media release, "Sylvie Cornot-Gandolfe, ‘The role of coal in Southeast Asia’s power sector’, Oxford Institute of Energy Studies, December 2016" notes that combined cycle gas turbine power plants are superior to coal power plants for Asia:
Natural gas-fired power plants are, however, cheaper and quicker to build than coal-fired power plants, have higher efficiencies and greater flexibility in plant operation, and above all emit less CO2 than coal power plants. (The cost of capital expenditure for combined cycle gas turbine (CCGT) plants is around half that of coal on a per kWe capacity basis and their CO 2 emissions are also half that of coal.)

The levelized cost of electricity generation (LCOE)14 is commonly used in national power development plans to compare the costs of different technologies. Based on IEA assumptions for the costs of capital, operation and maintenance, and finance, and using 2015 prices for coal and gas ($63.5/t for coal and $10.3/MMBtu for gas), the generating cost of a new supercritical (SC) coal plant is 35 per cent cheaper than the generating cost for a new CCGT plant (Figure 6). However, at August 2016 coal and gas prices, the generating costs for coal and gas are similar – even slightly cheaper for gas.

14The LCOE includes fixed costs, variable costs (operation and maintenance and fuel) and financing costs for new power plants. In order to make meaningful comparisons, it is necessary to make a range of assumptions about various costs and operating parameters of competing technologies, as well as assumptions on future coal and gas prices. coal and gas prices, the generating costs for coal and gas are similar – even slightly cheaper for gas.

Keeping the silliest announcement till last on 29 May 2017 Minerals Council of Australia issued another media release with the cryptic title "Government takes balanced view on low emission strategy".
The media release begins:
The Australian coal industry supports the government’s sensible policy which recognises the role of our high quality coal in helping to curb emissions.

If the policy intent is all about reducing emissions we should have a technology neutral approach and that means considering the opportunity coal offers when utilising both high efficiency low emission (HELE) and carbon capture and storage (CCS).

Including CCS in the Clean Energy Finance Corporation (CEFC) ambit strengthens our capacity to lower emissions in the supply of electricity.
It is what the media release doesn't say that is incredibly silly: if a power station operator can release CO2 into the atmosphere for free, then it is absurd to imagine any investment in capturing and storing that CO2.

The government which is led around by the Minerals Council of Australia has ruled out imposing any scheme to put a price on the release of CO2 into the atmosphere.

Saturday, May 20, 2017

Coal lobby pushing obsolete technology in Asia

The coal lobby tries to lock-in dependence on coal imports
The coal lobby tries to lock-in dependence on coal imports

Friday, May 19, 2017

Renewable natural gas

The Australian Petroleum Production & Exploration Association - "the voice of [one part of] Australia's oil and gas industry" - held its annual conference in Perth recently. The Twitter feed about the conference is under hash tag #APPEA2017

Approaches for increasing the supply of natural gas were on the agenda, but renewable energy production of natural gas didn't get a mention. The absence of Bioenergy Australia which is holding a Bioenergy Business Breakfast in Adelaide next week left the struggling oil and gas industry bereft of a host of ideas to address the intractable problem of rising costs of extracting natural gas. The problem it faces is that there aren't any more low-cost natural gas reserves to exploit.

New methods for producing natural gas from renewable energy are being developed and refined, continually lowering costs and improving efficiency.

At the same time:
  1. The cost of extracting coal seam gas is constantly increasing.
    Unconventional gas production involves significantly higher capital expenditure
  2. The domestic price of natural is continuing to rise.
    The wholesale price of natural gas in Australia has risen steeply
    The wholesale price of natural gas in Australia has risen steeply
These factors are making it more commercially attractive to produce natural gas from renewable energy. 

There are 3 underlying processes for making renewable natural gas no matter how the various technologies achieve them:
  1. Carbon dioxide can be converted into carbon-containing compounds and oxygen by algae and other plants using sunlight to drive photosynthesis.
  2. Carbon dioxide can also be converted into natural gas and water using hydrogen produced from electrolysis of water using electricity from renewable energy generation. Oxygen is produced as a by-product as in the first process.
  3. Any carbon-containing compounds including those produced by algae and plants in the first process described above along with farm waste and municipal waste, can be converted into a mixture of methane and carbon dioxide. About half the carbon in the input feed stock is converted into methane, and the other half into carbon dioxide. After the carbon dioxide produced as a by-product is separated, it can be converted into methane by recycling it into either of the first two processes. No "carbon capture and storage" required, avoiding a susbstantial cost of using natural gas from fossil fuel reserves.
    • Long established technologies use methane-producing bacteria that create methane and carbon dioxide in anaerobic fermentation ponds or tanks.
    • More recently plants have become available that use supercritical water as a gasification medium to create methane and carbon dioxide. These complete the gasification process more quickly and so don't need large tanks where methane-producing bacteria gradually transform the feed stock. This newer technology is especially well-suited for wet feed stock as there is no need to dry it.

These more recent technologies can also efficiently convert low-grade coal with high moisture content into natural gas. Existing coal-fired power could use this option to improve efficiency and lower emissions until it is feasible to decommission them.

Researchers at ENN Group, China and Carleton University, Canada recently investigated supercritical water lignite gasification technology. See "Coal-based Clean Energy Production", Advances in Energy Engineering (AEE) Volume 1 Issue 4, October 2013.

Supercritical Water gasification of wet biomass and low-grade coal
Supercritical Water gasification of wet biomass and low-grade coal

More recently the Lappeenranta University of Technology, Finland, completed an assessment of the option of Australia becoming a major exporter of renewable energy to Asia - making use of the Queensland LNG export facilities - to ship natural gas made with renewable energy. See "Can Australia Power the Energy-Hungry Asia with Renewable Energy?"

Sunday, May 7, 2017

Improving old coal-fired power stations

Existing coal-fired power stations using low-grade coal might continue to generate particulate and sulphur dioxide emissions until they are decommissioned. Some are fitted with scrubbers and other post-combustion filters to reduce these emissions. This approach reduces the efficiency of already inefficient coal-fired power stations:

The heating value of Indian coal is, on average, about 60 percent of the heating value of coal burned in the United States. This increases the amount of coal that must be burned to generate a given heat input, implying higher auxiliary electricity consumption to run coal grinding equipment, conveyors, and pumps.

Auxiliary generation... will also increase if electricity is used to run pollution abatement equipment, such as electrostatic precipitators ( ESPs ) and flue-gas desulfurization units ( scrubbers ) . We note although coal-fired power plants in both countries have ESPs, only three plants in India currently have scrubbers.1

In the meantime there are options to increase efficiency and reduce harmful emissions until it is feasible to decommission these coal-fired power stations.
Average Gross Thermal Efficiency of Coal-Fired Power Plants by Country

One of these options is to pre-process the low-grade coal before combustion. The technology available to do this has several advantages. It eliminates the particulate and sulphur dioxide emissions and, more importantly, increases the efficiency of these coal-fired power stations. Scrubbers and other post-combustion filters are no longer needed.

Low-grade coal contains relatively high levels of contaminants and moisture content. The moisture content reduces the energy available for power generation when its burned because energy is wasted converting the moisture into water vapour. The contaminants increase the energy that is used to run pollution abatement equipment.

To understand the available technology this simplified model gives a reasonable approximation of what takes place; Consider a process in which carbon and water are placed in a reaction vessel and an environment is created to promote a desired reaction that uses little or no external energy. The reaction breaks down some of the water into oxygen and hydrogen. The oxygen reacts with half of the carbon to form carbon dioxide and the hydrogen reacts with the remainder of the carbon to create methane. The energy released by the reactions with carbon provide the energy needed to break down water  into oxygen and hydrogen.
Hydromethanation - Carbon plus Water producing Methane plus Carbon Dioxide

The methane can be separated to use in place of low-grade coal in the existing coal-fired power stations. There are no particulates or sulphur dioxide to be removed from the exhaust gases. When methane burns, about half the energy is produced by the reaction of carbon with oxygen to produce carbon dioxide, and about half is produced by the reaction of hydrogen with oxygen to form water vapour. Note that the total amount of energy is the same as would have been produced if all of the carbon had been burned and not pre-processed into carbon dioxide and methane. The moisture content that was present in the low-grade coal has been separated, as water, before combustion. No energy is wasted converting that moisture into water vapour.
Supercritical Water Coal Gasification

Research on this technology was conducted in several countries interested in producing methane from biomass that contains significant amounts of water. That research has advanced into at least three commercially available products. These can be adapted to carry out the desired pre-processing of low-grade coal into methane:

Upgrading low-grade coal to methane
Upgrading low-grade coal to methane

1 Chan, Hei Sing (Ron), Maureen L. Cropper, and Kabir Malik. 2014. "Why Are Power Plants in India Less Efficient Than Power Plants in the United States?" American Economic Review, 104(5): 586-90. DOI: 10.1257/aer.104.5.586

Thursday, May 4, 2017

Commercial viability of coal seam gas

Australian coal seam gas is expensive to extract: about $4 to $5 a gigajoule. 
Rising cost of extracting coal seam gas
Rising cost of extracting coal seam gas
 The U.S. wholesale gas price is only $3 a gigajoule.
U.S. natural gas price
U.S. natural gas price
One option for increasing the natural gas supply in Australia, though it isn't the preferred option, is to import LNG from the U.S. 
The point to take away from this is that coal seam gas in Australia, facing competition from the U.S. that is rapidly expanding its LNG export capacity, is unlikely to be commercially viable within a few years. 
Expanding the unconventional gas industry that  has little prospect of long-term commercial viability isn't a good investment.
Another option for increasing the supply of natural gas is to make it from coal. Black coal in Australia is being sold into an over-supplied export market where the price is falling to around $2 a gigajoule.
Brown coal costs only about 50 cents a gigajoule.
New processes are available that can make methane from coal relatively cleanly. 
Supercritical Water (SCW) gasification of coal and wet biomass
Supercritical Water (SCW) gasification of coal and wet biomass

 Coal mixed with water and heated to 400 centigrade with solar thermal energy reacts to form approximately equal quantities of carbon dioxide and natural gas. 
Another way to heat the mixture is to add hydrogen produced by wind turbines or solar PV systems. With sufficient hydrogen, all of the carbon in the mixture reacts with the hydrogen to form natural gas and no carbon dioxide is created.

Sunday, April 16, 2017

Practical Energy

The requirement statement for practical energy -
The answer is surprisingly simple.

There are 4 or 5 processes that do more-or-less the same thing in slightly different ways. Each was designed with a different purpose in mind, but that doesn't mean they can't be used for other purposes the designers hadn't considered.

Bioenergy, waste-to-energy, renewable energy storage as synthetic natural gas, biogas and synthetic natural gas from coal are different ways of doing the same thing.

Synthetic natural gas can be used to store energy, to generate electricity on demand, and as feedstock in manufacturing processes. Synthetic natural gas can also be manufactured for export in the form of LNG.

It can be made from 100 percent renewable energy, 100 percent fossil fuel energy, or some combination of both renewable and fossil energy. This allows a transition to a 100 percent renewable energy future, achieving the  above requirement statement: ensuring reliable, affordable and clean energy.

The underlying process combines carbon dioxide, water and energy to create methane and oxygen:
CO2 + 2H2O → CH4 + 2O2
  • Photosynthesis by plants and algae to create biomass that methanogenic bacteria convert to methane is one way of doing this with solar energy.
  • Waste-to-energy can use methanogenic bacteria to produce methane using the solar energy embedded in the waste.  
  • Electrolysis of water to produce hydrogen that is reacted with carbon dioxide to make methane is another way of doing this with solar PV systems and wind turbines.
  • Biomass can be converted to methane in high temperature superheated water reactors. The thermal energy to do this can be from concentrated solar thermal energy, or from reaction with either oxygen or hydrogen created by electrolysis of water.
  • Biomass can be converted to methane in very high temperature gasifiers that create carbon monoxide and hydrogen that is reacted in a separate step to create methane. The energy for this high temperature process can be obtained by burning a portion of the feedstock in air. 
In each of the above processes that use biomass to produce methane, coal can be used in place of some or all of biomass.

When there is sufficient solar PV and wind turbine generating capacity, hydrogen can be produced whenever electricity supply exceeds demand. This hydrogen can be reacted with carbon dioxide to make methane for generating electricity whenever demand exceeds the supply.

With sufficient renewable energy generating capacity, synthetic natural gas can be manufactured for export - providing completely renewable energy to importing countries via existing LNG export, transport and import infrastructure.

Curiously, coal is presently being converted to synthetic natural gas in the most environmentally 'unfriendly' option available - burning a portion of the coal in air to create carbon monoxide and hydrogen that is reacted in a separate step to create methane. This technology has been criticised for its high level of carbon dioxide emissions and water usage.

Coal could be converted to methane by reacting it with hydrogen produced by electrolysis of water with electricity from solar PV systems and wind turbines. It can also be converted to methane in high temperature superheated water reactors. The thermal energy to do this can be from concentrated solar thermal energy, or from reaction with hydrogen created by the electrolysis of water.

This is most suitable for low-grade lignite such as that found in Yallourn Valley in Australia that consists of 50 percent or more water. With this process it can be converted to high-value synthetic natural gas, avoiding the need for coal seam gas.

Its use can be gradually phased-out as renewable energy generating capacity increases to the stage where it can completely replace it.

Sunday, April 9, 2017

Taking the blinkers off energy policy in Australia

The "Resources and Energy Quarterly" by the Office of the Chief Economist for March 2017 has the following Table of Contents:
About this edition 5
Resource and energy overview 6
Steel 25
Iron ore 33
Metallurgical coal 42
Thermal coal 51
Gas 61
Oil 73
Uranium 82
Gold 89
Aluminium, alumina and bauxite 97
Copper 113
Nickel 121
Zinc 127
Trade summary charts 133
Appendix 142

Renewable energy doesn't get a mention.

This oversight is the foundation on which opportunities for Australia's economic development are missed.

Two of the energy resources that are included - thermal coal and natural gas - are shown to have outlooks that aren't very promising in the case of coal and are at risk from high domestic production costs and low-cost competition in the case of gas.

Thermal coal exports for example are shown to decline in value by $5 billion per year to about $15 billion per year, though volumes are supposed to remain the same. Not all Australian coal mines will be commercially viable with this outlook that is actually describing export prices falling by 25 percent.

Australia's thermal coal export volumes and values

Natural gas exports as LNG are shown to have a large increase in capacity coming onstream at the same time as an even greater increase in U.S. LNG export capacity - with the U.S. exporters able to source feed gas at much lower prices than Australian exporters.

The quarterly report makes a courageous projection of rising volumes and value of Australian LNG exports even though noting some daunting obstacles:
  • Australia is not immune from supply-side competition. The United States will make the largest contribution to new capacity. The cost competitiveness of US exporters will largely be determined by the cost of their domestic gas, for which the reference price is Henry Hub. Henry Hub prices averaged US$3.0 per million British thermal units over the first quarter of 2017 (A$3.80 a gigajoule). 
  • While Australia's LNG exports are projected to rise, the capacity utilisation of Australian LNG export projects is expected to decline. The price competitiveness of Australian producers is one factor affecting the outlook for exports. Proximity to Asia will be an advantage, although the Panama Canal expansion in 2016 has lowered shipping costs from the US.
  •  A large cost for Australia's LNG plants is feed gas. The three LNG export terminals on the east coast — which are largely fed by CSG from Queensland’s Surat and Bowen basins — tend to have relatively high costs for feed gas. Unlike LNG ventures using gas from conventional reservoirs, LNG operators on the east coast will need to drill hundreds of new wells each year to maintain CSG production, with costs of over a million dollars per well.

Australia has an advantage with ample renewable energy resources to overcome the poor outlook for coal and the high-risk outlook for natural gas.

With the price of coal projected to decline to about $2 per gigajoule, and the cost of coal-seam gas likely to exceed the export price of LNG from US exporters, it is increasingly attractive, if not imperative, to export natural gas made from cheap coal and renewable energy.

Several processes are available to achieve this.

The bottom line is that these processes change 1 gigajoule of coal valued at perhaps $2 into 4 gigajoules of natural gas worth $32 by adding 3 gigajoules of renewable energy.

Available systems to make synthetic natural gas from cheap wet lignite and brown coal

Supercritical Water (SCW) Gasifier for Coal/Biomass

Monday, March 27, 2017

Australian gas industry operates in the dark

APPEA deleted the above Tweet - here is an image as it appeared on 27 March 2017

APPEA deleted the above Tweet too - here is an image as it appeared on 27 March 2017

What happens when your offer innovation advice to the Australian gas industry
What happens when your offer innovation advice to the Australian gas industry

Thursday, March 23, 2017

Energy cost savings in industry

Increases in energy costs are a signal for industry to audit its energy use and survey new plant that lowers energy use.

The abalone industry in South Australia in December 2016 received quotes for electricity supply at almost double its previous contract price:
Yumbah Aquaculture at Port Lincoln, on South Australia’s west coast, received an electricity contract quote for $1.35 million, $650,000 more than its current $700,000 contract.
Also in December 2016 the South Australian State Government announced a program to assist large businesses to audit energy use and invest in energy saving measures -
The 2016-17 Mid Year Budget Review provides $31 million over two years to help large South Australian businesses manage their electricity costs.

The Energy Productivity Program will be available to businesses that use more than 160MWh of electricity each year to incentivise investment in energy saving measures.

The funding will be available for businesses to undertake energy audits of their facilities to determine where efficiencies can be made.

The audits will also make recommendations about technology or infrastructure upgrades that could be carried out to reduce cost and grants will be available to implement the those recommendations. 
One area to examine in an energy audit at Yumbah Aquaculture is the circulation of  water from sea level up to its abalone growing tanks and back into the sea. The energy needed for pumps to raise water by, say, 20 metres is the same as the energy that is available when the same volume of water falls by 20 meters. Adding a micro hydro generator on the outflow from abalone growing ponds could generate almost as much energy used by the pumps to raise the water.

The value of the energy savings may make it worthwhile to invest in a micro hydro generator.

The food processing industry in Victoria has received quotes for natural gas with prices more than doubling in just a few years.
Echuca-based food processor Kagome expects to pay $3.6 million for gas this year, up from $2.4 million last year, despite plans to use less gas. Kagome employs more than 200 people. 
Natural gas is the dominant form of energy use for the food processing plant at KAGOME Australia
Natural gas is the dominant form of energy use for the food processing plant at KAGOME Australia
Kagome Australia's processing plant receives about 4,000 tonnes of tomatoes each day during the harvest period of 70 days. Natural gas is used to evaporate water from the tomatoes for the production of tomato paste.

Evaporating 1,000 tonnes of water from 4,000 tonnes of tomatoes each day can use an enormous amount of energy. This isn't necessary but it depends on how it is done.

One way to evaporate 1,000 tonnes of water that does use an enormous amount of energy is to simply put batches into large cauldrons with gas burners beneath them. Allow the tomatoes in the cauldrons to simmer until the desired volume of water has evaporated.

This way requires 2,257 gigajoules of thermal energy that converts 1,000 tonnes of water into steam. If this heat energy is supplied by natural gas costing $9 per gigajoule, the daily energy bill would be about $20,000 and the total bill over the tomato harvest period of 70 days woul be about $1.4 million.

There are several other ways to perform the same process using much less energy.

For instance, the energy needed to convert 1 kilogram of water into water vapour is 2,257 kilojoules. The same amount of energy can be recovered when that kilogram of water vapour is condensed back into water.
Mechanical Vapour Recompression (MVR)
Mechanical Vapour Recompression (MVR)

The mechanical vapour compressor uses a very small amount of electrical energy to transfer a very large quantity of heat energy from the condensing steam back into the cauldron of tomatoes where it boils off an identical amount of water.
The cost saving of this method is all of the natural gas used in the inefficient method of converting 1,000 tonnes of water into water vapour. This method also produces distilled water while continually recycling the latent heat of evaporation in the water vapour as it condenses back into water.

The condensed water produced may have some value too as a pure, distilled by-product.

Equipment using this method is commercially available. One type is marketed as "forced circulation evaporators". These are for concentrating fruit paste (tomato paste, peach paste, apricot paste and etc.) and some other products with high viscosity. Another type is marketed as "falling film evaporators". These are for concentrating products with low viscosity, for example: fruit juice, milk etc.

The value of the energy savings may make it worthwhile for Kagome Australia to invest in a forced circulation evaporator and eliminate the need for natural gas.

Another option for Kagome Australia is new technology that makes renewable natural gas from wet biomass - such as tomato plants - collected during  crop harvesting...

Monday, March 13, 2017

Even more ways for energy storage

When people think 'energy storage' batteries often are the first option that comes to mind.

A battery that has been discharged down to 25 percent of its capacity may hold, say, 3.6 gigajoules of electrical energy. 'Recharging' the battery, adding more energy, could increase the energy stored to, say, 14.4 gigajoules of electrical energy. This is the same as 4 megawatt-hours of electricity.

Another option for energy storage doesn't need a battery.

Think of brown coal as a 'battery' that has been almost completely discharged.

The amount of brown coal that can deliver 3.6 gigajoules of electrical energy - if it is burned in a coal-fired power station - contains about 380 kilograms of carbon.

Instead of burning the brown coal, energy can be added, in a similar way a battery can be 'recharged', so that it can deliver 15.5 gigajoules of electrical energy when needed - if it is burned in a combined-cycle gas turbine power station.

There's no need to understand the chemical reactions in a battery when it is being charged and discharged. There are many types of batteries and the chemicals and chemical reactions in each type are quite different.

When renewable energy is stored by adding it to brown coal, chemical reactions also take place, and achieves the same result as recharging a battery - but without the need for the battery.

Simplified process flow diagram of the supercritical gasification system developed by Gensos.
Simplified process flow diagram of the supercritical gasification system developed by Gensos.

Available systems to make synthetic natural gas from cheap wet lignite and brown coal

Supercritical Water (SCW) Gasifier for Coal/Biomass

Saturday, March 4, 2017

Fossil fuel energy is unreliable

Natural gas power is increasingly unreliable in Australia.

A simple law of physics explains why natural gas power stations are unreliable:
6 gigajoules of natural gas are needed to generate 3.6 gigajoules of electrical energy in a combined-cycle gas turbine power station.

Each 3.6 gigajoules of electrical energy (which is 1 megawatt-hour or 1 MWh) has a price of about $50 in the Australian Energy Market Organisation's National Electricity Market.

The natural gas used to generate this electrical energy costs about $9 per gigajoule in the Australian Energy Market Organisation's Wholesale Gas Market.

The result:
It costs about $54 for the natural gas used as fuel to generate each megawatt-hour of electricity. This has a wholesale price of only $50.

Rising domestic gas prices

In terms of production costs, over the last decade the finding and development costs for the petroleum industry have increased six-fold. And, in the three years to 2013, total Australian finding and development costs averaged $4.16/GJ, which was 2.7 times the average for the three years to 2007. These rising costs are partly explained by the fact that unconventional gas production involves significantly higher capital expenditure than that of conventional off-shore wells, given that CSG requires multiple wells to be drilled in order to access equivalent volumes of gas.

SANTOS July 2, 2015
Public Submission to ACCC East Coast Gas Inquiry

Natural Gas price in the U.S. - 1 million BTUs = 1.055 gigajoules
Natural Gas price in the U.S. - 1 million BTUs = 1.055 gigajoules

The projected US exports of around 7 trillion cubic feet of natural gas, or about 140 million tonnes of LNG is almost double the projected Australian exports of 85 million tonnes of LNG per year.

1 metric ton liquefied natural gas (LNG) = 48,700 cubic feet of natural gas.
1 trillion cubic feet of natural gas is about 20 million tonnes of LNG.

Given the much higher cost of producing coal seam gas in Australia, the ramping up of US LNG exports to 2020 is likely to bring the enthusiastic expansion of coal seam gas in Australia to a sudden end.

Wednesday, February 8, 2017

LNG exports and heatwaves drive up energy costs

The Australian Government's LNG export policy - with no reservation for industry and residential consumers - has resulted in a 250 percent increase in the cost of natural gas since 2014. The resulting $8.60 per gigajoule price for natural gas makes efficient, low emission combined cycle gas turbine (CCGT) power stations like that at Pelican Point, South Australia, quite costly to run compared to a high emission low efficiency (HELE) coal-fired power station.

The raucous noise over renewable energy in South Australia and the upsurge in government members spruiking high emission low efficiency (HELE) coal-fired power stations is most likely a deliberate distraction from this fiasco that is the government's "sell-it-all" LNG export policy.

AEMO Short Term Natural Gas Trading Market Quarterly Average Price

Gladstone LNG plant places a demand on gas from NSW and elsewhere

Energy Action | Feb 19, 2016

Gas flows on the Moomba-to-Sydney gas pipeline has supplied NSW with gas since 1976. However, according to data from the Australian ­Energy Market Operator (AEMO), the flow was reversed in December for the first time as the third of three gas export projects being built at Gladstone powered up.

New Moomba Gas Supply Hub launched

Wednesday, 1 June 2016

The Australian Energy Market Operator (AEMO) has today announced the launch of the newly established Moomba Gas Supply Hub and two additional trading locations at the Moomba to Adelaide pipeline and the Moomba to Sydney pipeline, which are now open for trading.

The Moomba Gas Supply Hub follows the successful introduction of the Wallumbilla Gas Supply Hub (GSH), established in 2014 to enhance the transparency and reliability of gas supply by creating a voluntary market that offers a low-cost, flexible method to buy and sell gas at interconnecting transmission pipelines.

Gas and LNG Market Outlook, January 2017

National Australia Bank

The exposure of eastern Australia to LNG export markets will have far reaching implications for domestic gas use.

Wholesale prices are likely to increase significantly and some questions remain over availability of commercially recoverable gas from Queensland coal seam gas fields.

Higher wholesale gas prices are likely to spill over into electricity markets by increasing fuel costs for peak load open cycle gas turbines.

Higher gas prices are already flowing through to large domestic customers, with reports that contracts are being offered well in excess of current netback export parity prices.

The price of gas for residential customers in Australia’s five largest cities could increase by more than 50% by 2020.

Boyne Smelter to close cells, cut production after power price spike

Tegan Annett | 21st Jan 2017, Updated: 23rd Jan 2017
Gladstone Observer

IF nothing changes in Queensland's electricity market, 40 aluminium-producing cells at Boyne Smelter will be closed.

That's the message from general manager Joe Rea who says it will result in jobs lost and leave the Boyne Smelter down 45,000 tonnes in aluminium production.

The price hike was driven by high electricity demand in response to very hot weather conditions in Queensland. He said on January 18, a new demand record was set at 9,357MW exceeding the previous record of 9,097MW.

Queensland moves to reserve gas for domestic use

Matt Chambers | 26th Jan 2017
The Australian

Gas producers have voiced alarm at Queensland’s move to earmark a small patch of new exploration ground for domestic use, although former federal resources ministers and previously staunch domestic gas reservation opponents Ian Macfarlane and Martin Ferguson have changed their position and now back the move.

Queensland Resources Minister Anthony Lynham yesterday announced the release of 58sq km of exploration ground in the onshore Surat Basin with the “strict” condition that any gas produced must be used in Australia.

The Queensland Resources Council, which counts both the big gas exporters and some big gas users (such as Incitec Pivot, Rio Tinto and Glencore) among its members and is now run by Mr Macfarlane, applauded the move.

Saturday, February 4, 2017

Searing heat years too soon for salad growers

The third heatwave in two months has hit salad growers in Queensland's south hard, with many farmers battling to harvest 30 per cent of their crop.
Farmer Clem Hodgman said he has been losing about 50,000 lettuces and 25,000 cauliflowers a week at his property near Toowoomba.
"The temperatures are so high, crops are burning off in the fields."
He said while prices were rising in supermarkets, farmers would not reap the benefit as energy and water costs rose accordingly.
"We don't want another summer like this for many, many years," he said.
But Rachel Mackenzie from farm lobby group Growcom said the heat could be the new norm.
She said an industry study into heat impacts on the salad industry did not predict such high temperatures for another 13 years.
"We were looking at 2030 in terms of when some of these thresholds would be reached," she said.
"This could be our new reality. We've had three years in a row where we've had significant heat, and we need to start saying what can we do to make sure we have the right [ways] to deal with this."

Birdsville sweats out record

The record for hottest February day in Birdsville in the state's far south-west has been broken, with Bureau of Meteorology (BOM) figures showing the mercury in the town hit 46.2 degrees Celsius at 4:10pm.
Previously, Birdsville's hottest February day was 45.8C in 2006.
The all-time record at Birdsville airport was 49C in January 2013.
More temperature records could be broken next week unless a high pressure system over the Tasman Sea arrives to cool things down.
The hot weather is the continuation of a low pressure surface trough over southern Queensland that contributed to higher than average temperatures in January.
Overnight minimums in January were the highest on record for a large area of southern Queensland, while maximum temperatures were in the highest 10 per cent of historical records for nearly all of the state's southern half.
The mercury peaked at 39.1C in Warwick on the Southern Downs yesterday, more than 10C above average.
BOM forecaster Vinord Anand said it was the hottest February day in the town since records began more than 50 years ago.
"The record before yesterday was 39 degrees, which was in February 1983," he said.
Applethorpe hit a scorching 36.8C, more than 11C above average.
"The last time it was nearly that hot was in February, also in 1983, when it was 36.1C," Mr Anand said.
The all-time maximum record for Applethorpe is 37.8C, while in Warwick it is 41.7C.
Mr Anand said it had cooled down slightly in the region today, with Applethorpe reaching 25C by 11:00am.
"It's cooler today in those areas compared to yesterday, but we do expect it to warm up again into the weekend and next week," he said.