Natural Gas Export Project Benefits and Forecast Analysis
Explore the potential benefits of the Cove Point Export Project in the United States, including job creation, reduction of trade imbalance, tax revenue, and more. Additionally, delve into the forecasted growth of domestic shale production, specifically focusing on the Marcellus shale region. Discover how these factors influence natural gas prices and market dynamics.
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Presentation Transcript
WV Public Energy Authority LNG Export August 22, 2012
Natural Gas Spot Prices Monthly Average 1997-2012 (Dollars per Million BTUs) Marcellus Shale Gas Production Lowers Price Demand up 6.5 BCFD 2 2 Source: Energy Information Administration, Henry Hub Natural Gas Spot Price.
Support for Cove Point Project The Post s View Cove Point means business The opportunity here is obvious: The United States should export some of its bountiful stocks of natural gas to Japan and other countries with fewer supplies and high demand. That is why Dominion Resources wants to retrofit its Cove Point facility to service exports as well as imports. In fact, with the Interior Department and the Environmental Protection Agency both out with sensible new rules over the past few weeks, approving projects such as Cove Point should be seen as a win for everyone, environmentalists included. 3
Cove Point Export Project Benefits for the United States Jobs 7,000 Short Term 14,600 Long Term U.S. Trade Imbalance Reduce $2.8 to $7.1 billion/year 0.6% to 1.4% improvement Taxes Almost $1.0 billion per year Revenue $22 billion in government royalty revenue Up to $40 million in annual property taxes in Calvert County, MD 4 Source: ICF International
Cove Point Export Project Construction Jobs Approximately 5-6M total man-hours 1,500 jobs on-site at the peak of construction 750 jobs on average through the 36-42 month construction period Source: Dominion Estimates 5
Domestic Shale Production Forecast 50 YOY Marcellus production growth to average 18% for the next five years 45 Background Information: Winter time Northeast gas demand is forecasted to avg 15 Bcf/d by 2020 Economics of shale allow it to displace traditional supplies from Gulf/Canada/LNG in low priced environments ICF estimates that nearly 26 Bcf/d of incremental pipeline capacity is needed across the US to satisfy market needs by 2020 40 35 30 Bcf/d Expected to reach 11.1 Bcf/d in 2020 25 20 1 5.6 BCFD 15 Lower 48 Total Supply 2010 Shale: 26% 2020 Shale: 41% 10 5 0 2000 2003 2006 2009 2012 2015 2018 2021 2024 2027 2030 Barnett Fayetteville Woodford Haynesville Marcellus Eagle Ford Horn River Montney Duvernay Source: Wood Mackenzie 6
