August 2022, Vol. 249, No. 8


Algeria, Niger, Nigeria Take Steps to Build Trans-Saharan Pipeline

Finland Plans to Build Hydrogen Pipeline Network 

Finland plans to build a hydrogen transmission network, which will include construction of a pipeline, near its southeastern border with Russia. The network is expected to take several years to build.  

Initial plans call for a 9-mile (15-km) pipeline to run from the facilities of chemicals producer Kemira’s fertilizer plant in Joutseno to steelmaker Ovako’s plant in Imatra. 

No cost estimate was provided by the government, but Finnish state-owned company and transmission system operator Gasgrid Finland said the project will be funded in the early stages by the company’s existing capital. 

Finland said it would stop using Russian gas following the invasion of Ukraine, and Moscow cut supplies when Finland refused to pay in rubles. Finland has several alternatives to Russian gas, including nuclear energy, but is interested in expanding the use of hydrogen to reduce carbon emissions. 

Gasgrid Finland announced it has found a subsidiary that will develop the hydrogen transmission network, first in Finland and later abroad, adding production of hydrogen would be left to private companies. 

CenterPoint Launches Green Hydrogen Project in Minnesota 

CenterPoint Energy kicked off its green hydrogen project in Minneapolis, which uses renewable electricity to split hydrogen from water for blending at low concentrations of up to 5% with natural gas in the utility’s local distribution system. 

The location is one of the first natural gas utilities in the United States to produce and add green hydrogen to its distribution system. Because there are no carbon emissions from either its production or end-use, green hydrogen has the potential to be an important zero-carbon supplement to conventional natural gas. 

“With this pilot project, we are exploring the potential of green hydrogen as a safe, zero-carbon energy resource that can be delivered through our local gas distribution systems to benefit both our customers and the environment,” said Scott Doyle, CenterPoint’s executive vice president of Utility Operations. 

The primary goal of the pilot project is to gain operational experience with the technology for making green hydrogen and how it can be integrated most effectively into the local natural gas distribution system to lower the carbon content of delivered energy, CenterPoint said. 

The project’s 1-megawatt electrolyzer is powered by renewable electricity and can produce up to 60 dekatherms (432 kilograms) of hydrogen gas per day, using approximately 2 gallons of water per minute (8 liters per minute). The water is sourced from the municipal water supply and highly purified before it enters the hydrogen production system. 

Ukraine to Tap Gas Capacity to Offset Loss of Nord Stream 1 Flows 

Ukraine’s gas transmission operator said the nation has about 109 MMcm/d (3.8 Bcf/d) of spare gas capacity through a transit route to Europe that it used to make up for previous flows from Nord Stream 1. 

The announcement came in the wake of Gazprom’s 40% reduction in supplies via the pipeline, running beneath the Baltic Sea to Germany.  

Gas Transmission System Operator of Ukraine (GTSOU) Chief Executive Sergiy Makogon told Reuters in an interview, Sudzha’s technical capacity was 244,000 per day. That is compared with Nord Stream’s regular capacity of about 160 MMcm/d (5.6 Bcm/d), lately capped by Gazprom at 96 MMcm/d (3.4 Bcf/d). 

Gazprom has already paid and booked 77.2 MMcm/d (2.73 Bcf/d) capacity on the Sudzha route, but it has been using only a part of that, with its current nominations, or requests for gas, at 41.7 MMcm/d (1.47 Bcf/d), he added. 

In addition, GTSOU has said that Gazprom can transfer 32.4 MMcm/d (1.14 Bcf/d) booked capacity from Sokhranivka to the Sudzha point, but it has not used this option. Total spare capacity amounts to 109.8 MMcm/d (3.88 Bcf/d). 

Algeria, Niger, Nigeria Take Steps to Build Trans-Saharan Pipeline  

After delays of more than 40 years, Algeria, Niger and Nigeria have set up a task force on building the 2,565-mile (4,128-km) Trans-Saharan gas pipeline. The estimated $13 billion project could supply Europe with 1 Tcf (30 Bcm) of gas annually. 

“(The pipeline) should allow Europe to diversify its sources of natural gas supply but also allow several African states to access this high value energy source,” according to a statement by Niger’s oil ministry. 

The pipeline would start in Warri, Nigeria, and end in Hassi R’Mel, Algeria, where it would connect to existing pipelines that run to Europe. Additionally, Nigeria appears to be moving forward with a pipeline through West Africa and Morocco to Europe. 

Cheniere to Move Forward with Texas Corpus Stage 3 LNG Expansion 

U.S. LNG company Cheniere Energy decided to go forward with the expansion of the Corpus Christi, Texas, export plant and has advised Bechtel Energy to proceed with construction.

In making the announcement, Cheniere said the project will include a gas pipeline. 

“Reaching FID on Corpus Christi Stage 3 represents an important milestone for Cheniere as we move forward on this significant growth project,” Cheniere CEO Jack Fusco said in a statement. 

The Stage 3 expansion at Corpus Christi was the second U.S. LNG export plant to reach a final investment decision (FID) this year as demand for natural gas soars. In May, Venture Global LNG made an FID to build its Plaquemines LNG export plant in Louisiana. 

Both projects were already under early construction when the companies made FIDs. 

Stage 3 is expected to add seven mid-scale liquefaction trains, producing 10.5 mtpa of LNG (1.4 Bcf/d [40 MMcm/d] of natural gas). 

Trans Mountain Pipeline No Longer Profitable, Budget Office Says 

The Canadian government-owned Trans Mountain oil pipeline is no longer profitable after cost overruns and delays to its expansion project, the nation’s parliamentary budget officer (PBO) said. 

A report from the PBO said the pipeline has a net present value of negative $463.03 million (negative C$600 million), based on the difference between Trans Mountain’s cash flows and its $3.41 billion (C$4.4 billion) purchase price. 

If Ottawa cancels the expansion, the government faces an $11.16 billion (C$14.4 billion) write-off, the PBO analysis showed. 

The cancellation scenario is hypothetical, and the government has no such plans, a government source told Reuters. The source added that the PBO analysis of unprofitability does not consider other economic benefits such as jobs. 

The pipeline moves up to 300,000 bpd of oil from near Edmonton, Alberta, to the Pacific coast in British Columbia, and the expansion would nearly triple capacity. 

Utah Hydrogen Storage Project Gains DOE Loan Guarantee  

The U.S. Department of Energy (DOE) closed on a $504.4 million loan guarantee to Mitsubishi Power Americas and Magnum Development to help finance the construction of the Advanced Clean Energy Storage I project in Utah, the world’s largest industrial green hydrogen storage facility. 

The loan guarantee is the first for a new clean energy technology project from DOE’s Loan Programs Office (LPO) since 2014. 

“Accelerating the commercial deployment of clean hydrogen as a zero-emission, long-term energy storage solution is the first step in harnessing its potential to decarbonize our economy, create good paying clean energy jobs and enable more renewables to be added to the grid,” said U.S. Energy Secretary Jennifer M. Granholm. 

The project is expected to create up to 400 jobs, adding a projected 25 full-time operations and maintenance personnel. It is set to help advance President Biden’s goal of net-zero emissions by 2050 through clean energy deployment, as well as replacing a retiring coal-fired power plant. 

The Advanced Clean Energy Storage hub will support the Intermountain Power Agency’s IPP Renewed Project – upgrading to an 840-megawatt (MW) hydrogen-capable gas turbine combined cycle power plant.  

The plant will initially run on a blend of 30% green hydrogen and 70% natural gas starting in 2025 and incrementally expand to 100% green hydrogen by 2045. 

The hub will produce up to 110 US tons (100 metric tonnes) per day of green hydrogen from renewable energy using electrolysis. Green hydrogen can then be stored in two massive salt caverns, each capable of storing 150 gigawatt hours (GWh) of energy, resulting in the world’s single-largest hydrogen storage site, and providing capabilities for seasonal shifting of excess renewable energy. 

The long-duration energy storage capability of the salt caverns will help improve resource adequacy and decrease costs by capturing excess renewable power when it is abundant and dispatching it back on the grid when it is needed. 

In May, the LPO reviewed 77 applications for projects in 24 states, totaling nearly $79 billion in requested loans and loan guarantees, according to the DOE. 

Argentina Contracts Tenaris for 350-Mile Vaca Muerta Pipeline 

Argentine’s Energia Argentina signed a contract with pipeline producer Tenaris in a major step toward completing a natural gas pipeline from the nation’s massive shale formation. 

The 350-mile (563-km) gas pipeline, now in its early stages of construction, will provide a 25% boost in the volume of gas transferred from the Vaca Muerta megafield from the province of Neuquen. 

The contract is for the purchase of 362 miles (582 km) of 36-inch pipeline and 46 miles (74 km) of 30-inch pipeline. 

The project is seen as a way to avoid expensive liquefied natural gas (LNG) imports and reverse a big energy deficit that has limited the country’s economic recovery. 

The first stage of construction is expected to last 18 months and cost more than $1.5 billion, the energy ministry said. Vaca Muerta is the world’s fourth-largest unconventional oil reserve and second-largest gas reserve. 

Italgas to Invest $4.7 Billion to Upgrade Gas Pipeline Network  

Italgas will spend $4.7 billion in 2028 to upgrade its domestic Italian network, which includes 46,000 miles (74,000 km) of regulated gas pipelines, the company announced recently. 

“The largest share of the investments is destined for the extension, digital transformation and repurposing of the distribution network in order to create ... the conditions for the widespread use of the new gases, such as biomethane, green hydrogen and synthetic methane,” Italgas CEO Paolo Gallo said. 

In its six-year business plan, the company earmarked $4.7 billion in investments for Italy and roughly $1.9 billion for Greece to modernize the country’s gas grid. Italgas expects to complete the acquisition of Greece’s DEPA Infrastructure soon. 

Italgas expects to reach net-zero carbon emissions by 2050. 

Companies Look to Hydrogen to Extend Life of US Pipelines 

Natural gas companies plan to use hydrogen and renewable natural gas (RNG) made from landfills or agricultural waste to extend the life of existing pipelines in a future carbon-free world, energy executives said at the Reuters Global Energy Transition conference. 

SoCalGas, a unit of California energy company Sempra Energy, wants to turn some of that wasted renewable power into hydrogen that can be transported through its gas pipes. 

In addition to its existing gas pipes, SoCalGas proposed the Angeles Link pipeline to transport green hydrogen into the Los Angeles basin. 

U.K. energy company National Grid Plc plans to use hydrogen and RNG as part of its plan to eliminate carbon emissions by 2050. 

Ben Wilson, chief strategy and external affairs officer at National Grid, said the company plans to use offshore wind to produce green hydrogen during the overnight hours. 

SoCalGas and National Grid both said it would help if states adopted renewable fuel standards that would require utilities to buy a certain amount of renewable gas to encourage energy firms to produce more of it. 

A renewable gas standard would be similar to renewable portfolio standards in several states, which resulted in construction of more wind and solar power plants.

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