September 2020, Vol. 247, No. 9




Poland Fines Gazprom $57 Million Over Nord Stream 2

Poland’s antimonopoly watchdog UOKiK (Office of Competition and Consumer Protection) fined Gazprom $57 million for lack of cooperation in its proceedings with regard to the Nord Stream 2 pipeline project. 

Poland sees Nord Stream 2, which would double Russia’s gas export capacity via the Baltic Sea, as a threat to Europe’s energy security, saying it will strengthen Gazprom’s market dominance.

Nord Stream 2 is led by Gazprom, with half of the funding provided by Germany’s Uniper and BASF’s Wintershall unit, Anglo-Dutch company Shell, Austria’s OMV and Engie.

UOKiK has been examining the project for years, and in 2019 it fined Engie $47 million (40 million euros) for failing to provide documents and information relating to the case.

“At the beginning of the year, we requested Gazprom provide us with contracts concluded by its subsidiary with other companies financing the construction of Nord Stream 2 ... The company failed to provide such information,” the head of UOKiK said in a statement.

Gazprom declined to comment to Reuters. Russian President Vladimir Putin and Gazprom have said they plan to complete Nord Stream 2, which is more than 90% finished.

In July, Gazprom paid PGNiG the $1.6 billion the Polish company won in a pricing dispute, and PGNiG chief executive said that Poland’s relations with Gazprom were “becoming normal.”


Construction Underway on Southern Section of China-Russia Pipeline

Construction began on the southern part of the China-Russia East natural gas pipeline, which carries supplies from the Power of Siberia system in Russia, according to PipeChina.

When launched in 2025, the pipeline portion will carry 667 Bcd/d (18.9 Bcm/d) to the Yangtze River delta region each year, the company’s statement said.

The full China-Russia East system is a 3,176-mile (5,111-km) pipeline from the Siberia in Russia to China. This portion starts at Yongqing in the northern province of Hebei and ends at Shanghai in eastern China. 

The middle portion of the China-Russia East system will connect Changling in Jilin province and Yongqing. Work on that section began in February and is scheduled for completion by the end of 2020.

Northeastern China began using Russian gas from the north portion of the China-Russia East pipeline in December.


World’s Longest Hydraulically Inserted Pipe Efforts Completed

Construction of a 3-mile (5-km) replacement tunnel running 98 feet (30 meters) under the River Humber in Northern England is near completion, with the last piece of gas pipeline having been inserted. 

Working with project partners Skanska, A.Hak and Porr, a 12-foot (4-meter) diameter tunnel was built under the river to replace a trench-laid gas pipe that had become exposed. Toward the end of this year when gas begins to flow through the pipeline, it will help ensure a reliable and resilient supply of up to 25% of Britain’s gas.

Two hydraulic thrust machines began the task of pushing eight 2,000-foot (610-meter) and 850-ton (771-metric ton) sections of pipe on rollers into the new tunnel from the Goxhill side of the Humber on June 23. The pipes were pushed at a rate of about 3 feet (1 meter) per minute into the tunnel, which had been flooded with 2 MMcf (50,000 cubic meters) of pure and treated water, enough to fill 16 Olympic swimming pools, to aid the installation.

After one pipe section had been installed, the next was moved into position and welded to the one in front. The push continued until all 3.1 miles (5 km) of pipeline were in place July 9, becoming the world’s longest hydraulically inserted pipe.

“Completing the installation of the pipeline under the Humber is a major milestone for both the project team and partners,” said Steve Ellison, senior project manager, Capital Delivery, for National Grid. “We will now begin work to connect the pipeline to the network, ready for gas to begin flowing toward the end of the year.”


TC Energy Announces $400 Million ANR Pipeline Enhancement Project

TC Energy will proceed with the Elwood Power/ANR Horsepower project that will replace, upgrade and modernize certain facilities along a highly utilized section of its ANR Pipeline Company (ANR) natural gas transmission system.

Under a long-term agreement, ANR would provide up to 125,000 Dth/d of firm transportation service to an existing power plant. 

“The facilities are designed to enhance the safety and reliability of our ANR pipeline system while reducing emissions,” said Russ Girling, TC Energy president and CEO. “This investment will serve to reinforce a key portion of our ANR pipeline network in the Midwest, allowing us to maximize its capacity to support increased power generation and growth along our existing right-of-way.”

The ANR pipeline runs from the Appalachian basin to the Midwest and Southwest with connections to the Gulf of Mexico.

In 2014, the pipeline was made bidirectional, and in 2018 it was extended to northern Illinois and southern Wisconsin.

The facility’s work includes compression and ancillary upgrades as well as other modifications along ANR’s existing infrastructure. The project is targeted to be brought in service in the second half of 2022 with an estimated cost of $400 million.


Freeport Seeks More Time to Build Train 4 at Texas LNG Facility

U.S. liquefied natural gas (LNG) company Freeport LNG asked federal energy regulators for three more years, until May 2026, to complete its proposed fourth liquefaction train at its LNG export plant in Texas. 

The U.S. Federal Energy Regulatory Commission (FERC) approved construction of the fourth train in May 2019, requiring Freeport to finish the facility within four years, by May 2023.

Like other LNG exporters around the world, Freeport put off making a final investment decision (FID) to build the fourth train earlier this year after gas prices in Europe and Asia collapsed to record lows due to coronavirus demand destruction. 

“Given the current market conditions resulting from COVID-19, Freeport LNG does not expect to reach FID on Train 4 this year,” Freeport Spokeswoman Heather Browne told Reuters. “We can be ready to start construction by mid-2021, if market conditions improve.”

Before delaying the FID in March, Freeport had said it planned to make a decision on Train 4 during the first quarter of 2020, which would have enabled the unit to enter service in 2023.


National Fuel Acquires Gathering Assets in Pennsylvania

National Fuel Gas Company completed the purchase of integrated upstream and midstream gathering assets in Pennsylvania from SWEPI LP, a subsidiary of Royal Dutch Shell, in an all-cash transaction of approximately $504 million, after customary purchase price adjustments.

“The closing of the largest acquisition in our 118-year history marks an exciting time for the Company, and leaves us well-positioned for the long-term,” said David P. Bauer, the company’s president and chief executive officer.

The Company expects this acquisition to be highly accretive to its earnings per share in fiscal 2021, driven by significant acquired flowing production and related gathering throughput, further unit cost reductions, and its strong hedge position.

Peruvian Pipeline Operation Restarts After Pandemic Shutdown

Peruvian state energy firm Petroperu restarted its pipeline operation “under strict security protocols” after it was halted in late April as a preventive measure against the coronavirus epidemic, the company said in a statement. 

Petroperu said that before restarting the pumping of crude from the country’s jungle inland to the north coast, all workers were subjected to medical controls and tests to rule out COVID-19 infections.

The Andean nation has recorded 414,735 confirmed cases of the virus, putting it third behind Brazil and Mexico in terms of infections in Latin America. 

The oil company is in the process of an expansion, with an estimated investment of $4.7 billion to raise the processing capacity of its Talara refinery to 95,000 bpd of crude oil from the current 65,000 bpd.

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