Download - Developments in the Wholesale Gas Market
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David Strahan
Managing Director, Phoenix Energy Ltd
Developments in the Wholesale Gas Market
Examining Energy Market Developments October 2010
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Agenda
_ About Phoenix Energy Ltd
_ Wholesale Gas Market Developments
_ Unconventional Gas
Examining Energy Market Developments October 2010
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About Phoenix Energy
_ Part of Phoenix Energy Holdings Ltd Group of companies
_ Phoenix Natural Gas is the largest distribution network owner in Northern Ireland
_ Phoenix Supply is the largest natural gas supplier in Northern Ireland
_ Owned by Terra Firma
Examining Energy Market Developments October 2010
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Examining Energy Market Developments October 2010
Customers Supplied on the island of Ireland
_ In customer number terms, Phoenix is
the second largest natural gas supplier
on the island of Ireland
_ Phoenix has 135,000 customers
Customer numbers based on Commission for Energy Regulation Gas Market Update – 2010 (Q2) (CER/10/133) and NIAUR
consultation on the options for co-ordinating the relinquishing of firmus energy’s supply exclusivity in the ten towns area
Number of natural gas customers supplied on the island of Ireland (June 2010)
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Examining Energy Market Developments October 2010
Volume of natural gas supplied on the island of Ireland (January 2010 - June 2010) (excluding power generation)
Gas Supplied on the island of Ireland
_ In volume terms, Phoenix is the third
largest natural gas supplier on the
island of Ireland
_ Phoenix is growing by around 8,000
new customers each year
Volume supplied based on Commission for Energy Regulation Gas Market Updates and NIAUR consultation
on the options for co-ordinating the relinquishing of firmus energy’s supply exclusivity in the ten towns area
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Examining Energy Market Developments October 2010
About Phoenix Energy
_ Our aim is to achieve 30% market share within 3 years
Volume supplied based on Commission for Energy Regulation Gas Market Update Reports
2009 Volume Supplied to Above RTF (non powergen) Sector
2010 (Jan – June) Volume Supplied to Above RTF (non powergen) Sector
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Gas Consumption in Ireland
Examining Energy Market Developments October 2010
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Liquefied Natural Gas (“LNG”) Facts
_ Cooled to -160oC (takes up to 600 times less space
than when in gas form)
_ Vessels
• c.136 ships
• 260,000 cubic metres
_ Key Producing Nations
• Qatar (15%), Indonesia (14%), Malaysia (13%),
Algeria (12%), Australia (9%), Trinidad (8%),
Nigeria (8%)
_ Links UK and Ireland to global energy prices to a
much greater degree
Examining Energy Market Developments October 2010
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South Hook LNG
_ Location
• Milford Haven, South West Wales
_ Owners
• Joint venture between Qatar Petroleum (67.5%), ExxonMobil (24.15%)
and Total (8.35%)
_ Capacity
• 21bcm per annum
• c.18% of current UK demand
• Europe’s largest LNG terminal
_ Source
• Qatar’s North Field Gas Reserve
• 6,000 km2 – half the size of the state of Qatar
• 900 trillion cubic feet – world’s largest gas reservoir
Examining Energy Market Developments October 2010
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Isle of Grain LNG
_ Location
• Kent
_ Owner
• National Grid
_ Capacity
• 13bcm per annum. Phase 3 takes it to 20bcm per annum
• c.11% (rising to c.17%) of current UK demand
• Three of worlds largest above ground LNG storage tanks
_ Customers
• Long term capacity contracts
• 2005: BP/Sontrach
• 2008: Centrica, GDF Suez, Sonatrach
• 2010: Centrica, E.ON, Iberdrola
Examining Energy Market Developments October 2010
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Dragon LNG
_ Location
• Milford Haven, South West Wales
_ Capacity
• 6bcm per annum
• c.5% of current UK demand
_ Owners
• Three shareholders: BG Group (50%), Petronas (30%) and 4Gas (20%)
_ Customers
• Long term capacity contract
• BG and Petronas have contracted for the full capacity at Dragon
• Petronas is owned by Malaysian government with operations in 30 countries
Examining Energy Market Developments October 2010
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Volume of UK LNG Imports
Examining Energy Market Developments October 2010
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Net Interconnector Flows
Examining Energy Market Developments October 2010
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Rough Storage Levels
Examining Energy Market Developments October 2010
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Shale Gas Production
Examining Energy Market Developments October 2010
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Potential United States Shale Gas Resources
Examining Energy Market Developments October 2010
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Shale Gas – Words of Warning
_ Environmental impact
• Visual
• Greenhouse gas emissions
• Natural gas obtained through “hydrofracking” produces greater emissions than
“conventional” natural gas – could it be worse than coal?
_ Radically changes supply / demand balance
• Markets do not respond well to “shocks”
• Could relatively low price levels accelerate gas demand growth?
Examining Energy Market Developments October 2010
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Contact us
_ If you wish to discuss what Phoenix Energy Ltd
can do for you, please contact:
_ John Ellis
Mobile 085 834 8936
Email: [email protected]
_ Andrew Smith
Mobile 085 834 8937
Email: [email protected]
John Ellis Andrew Smith
Examining Energy Market Developments October 2010