From the Daily Caller News Foundation

By David Blackmon

“When something is unsustainable, it eventually stops,” former Vice President Al Gore said in an op/ed published by The Wall Street Journal. Given recent events, one might think Gore was referring to the ruinously costly attempts by governments of the Western world to force an energy transition via trillions of debt-funded dollars in subsidies for unreliable, intermittent energy sources like wind, solar and green hydrogen.

It has become obvious to most in the energy business now that the stick-and-carrot approach to a forced transition implemented by the Biden administration is not just unsustainable but a colossal failure. The stick of heavy-handed regulations and mandates combined with the carrot of economically ruinous government subsidies has resulted in a massive uptick in the national debt along with a playing field littered with dozens of bankruptcies by both startups and pre-existing green energy companies alike. Collectively, their waste of federal dollars makes the Obama-era Solyndra failure look like pocket change.

As critics of the Biden Green New Deal suite of policy choices repeatedly warned, the rent-seeking industries that became the chosen clients of the Democratic Party over the last four years – wind, solar, electric vehicles and green hydrogen – cannot displace fossil fuels in any scalable sense because the laws of physics don’t allow it. Too many companies in these industries also cannot be sustained for more than short periods of time without constant new injections of additional government subsidies, all of which in the U.S. have the impact of increasing the national debt.

When the Orwellian-named Inflation Reduction Act passed on party line votes in congress in 2022, I and others warned that the Democrats in congress and the Biden White House viewed the bill as just an initial down payment on their long-term goals. A steady succession of new IRA-type debt-funded bills would be required in the coming decades to sustain the transition, and without those added tranches of trillions of dollars in additional subsidies, most startups in those non-competitive energy businesses would ultimately fail. It wasn’t hard to see this coming.

In his op/ed, Gore writes all this financial carnage off with his typical climate alarm fearmongering, saying things like “treating the transition to a sustainable economy as optional isn’t an option,” and “the cost of inaction is indefensible and unbearable.” To which the only proper response is to ask Gore to tell that to all the lower income Americans who have seen their utility bills and food prices inflate to unbearable levels as they have borne the brunt of the inevitable outcome of the policies Gore, Biden and their cronies have happily forced onto the public. It’s one of the greatest transfers of wealth from the poor to the wealthy in global history. If you want an example of unsustainability, there it is.

Most hilariously, Gore states that “in the U.S., the fossil-fuel industry, its allies and captive policymakers seek to punish companies and investors pursuing sustainability goals with frivolous lawsuits, smear campaigns and the withdrawal of state-controlled funds under management.” Holy smokes, talk about a prime example of Clintonian projection, there it is.

No industry has been subjected to a decades-long constant stream of frivolous lawsuits and smear campaigns from critics quite like the coal and oil and gas industries have sustained in modern times. Right now, today, the oil industry is spending hundreds of millions of dollars defending itself against a well-organized lawfare campaign in which left-wing law firms recruit friendly, mostly-Democrat officials in cities, counties and states around the country to file frivolous lawsuits claiming billions of dollars in unsubstantiated damages related to climate change theoretically caused by emissions coming mainly from China. That is the very definition of a frivolous smear campaign and lawfare campaign rolled into one.

But it is Gore’s complaint about the effort by the Trump administration to implement a “withdrawal of state-controlled funds under management” that really takes the cake here. Apparently, this former vice president believes that elections really don’t matter at all.

But elections do matter, policies can change and billions of dollars in funds awarded to political cronies of one president can indeed be clawed back by another. Gore can rage against these winds of change all he likes, but that is American democracy in action.

David Blackmon is an energy writer and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.

From EnergyNow.Ca

By Susan McArthur

Canada is now among the top 10 countries with natural gas reserves. It’s time to take advantage of that

Canadians are starting to understand the Americans ate our breakfast, lunch and dinner when it comes to selling liquefied natural gas (LNG) on the global market while simultaneously undermining our national security.

They are finally waking up to the importance of the urgent request by oil and gas CEOs to all federal party leaders calling for the removal of legislation and regulation impeding and capping the development of our resources.

The LNG story in the United States is one of unprecedented growth, according to a recent Atlantic Council report by Daniel Yergin and Madeline Jowdy. Ten years ago, the U.S. did not export a single tonne of LNG. Today, U.S. exports account for 25 per cent of the global market and have contributed US$400 billion to its gross domestic product (GDP) over the past decade.

The U.S. is now the world’s largest LNG supplier, edging out Qatar and Australia, and according to Yergin and Jowdy, its export market is on track to contribute US$1.3 trillion to U.S. GDP by 2040 and create an average of 500,000 jobs annually.

Last week, Alberta announced a sixfold increase in its proven natural gas reserves to 130 trillion cubic feet (tcf). The new figures push Canada into the top 10 countries with natural gas reserves.

Unfortunately, notwithstanding this vast resource, Canada didn’t even make it to the LNG party and the Americans have been laughing all the way to the bank at Canada’s expense. Our decade-long anti-pipeline and natural resource agenda has cost us dearly and Donald Trump’s trade tariffs are a stake to the heart.

As the world grapples with global warming, natural gas is the perfect transition fuel. It generates half the CO2 emissions of coal, provides needed grid backup for intermittent renewable wind and solar power, and it is relatively easy to commission.

Canada has extensive natural gas reserves, but these reserves are less valuable if we can’t get them to offshore markets where countries will pay a premium for energy generation. Canadian gas is abundant, but, given our smaller market, typically trades at a discount to U.S. gas and a massive discount to European and Asian markets.

The capital-intensive nature of LNG facilities requires long-term supply contracts. Generally, 20-year supply contracts with creditworthy counterparties are required to secure the financing required to build gas infrastructure and liquefaction plants.

For example, as part of a larger strategic deal, Houston-based LNG company NextDecade Corp. signed a 20-year offtake agreement to supply 5.4 million tonnes per annum (mtpa) to French multinational TotalEnergies SE.

As the market grows and matures, the spot market is gaining share, but term contracts continue to represent most of the market. This is a problem for Canada as it tries to break into the market, as much of current and future demand is already committed.

More than half the current LNG market demand, or 225 mtpa, is under contract until 2040, according to Shell PLC’s LNG outlook report for 2024. A further 100 mtpa is contracted to 2045. Shell recently revised its LNG market growth forecast upward to 700 mtpa by 2040 and it estimates the LNG supply currently in operation or under construction already accounts for about 525 mtpa, or almost 75 per cent of the estimated market in 2040.

Even if Canada secured 100 per cent of the available market share (impossible), this represents a fraction of the 130 trillion cubic feet of reserves in Alberta and an infinitesimal amount of Canada’s natural gas reserve.

If Canada wants to sell its LNG to the global market, it needs to be at the starting line now. Canada has seven LNG export projects in various stages of development. They are all in British Columbia. The capacity of these export plants is 50 mtpa and the capital cost is estimated to be $110 billion.

After significant delays and cost overruns, our first export facility, LNG Canada’s 14 mtpa Phase 1 in Kitimat, is set to ship its first cargo to Asia later this year. Phase 2, representing a further 14 mtpa, is still awaiting a final investment decision. The Cedar LNG, Ksi Lisims LNG and Woodfibre LNG projects are licensed, at various stages of development and represent a further 17 mtpa.

Canada’s LNG exports today are a drop in the bucket compared to both our potential and the 88 mtpa exported by the U.S. in 2024. We have one project completed and, if history repeats itself and Canada doesn’t get its act together, the runway for the remaining licensed projects will be long, painful and costly.

Financing large capital projects requires predictability with respect to timing and cost. This is also a problem for Canada. As the oil and gas CEOs have pointed out, LNG market players have lost trust in Canada as an investible jurisdiction for these projects.

In the face of Trump’s trade war, Canadians have become pipeline evangelists. Wishful thinking and political talking points won’t be enough if we repeat our decade of own goals on this file. We have literally left billions on the table.

Governments should fast-track all licensed projects, limit special interest distractions and provide the required muscle and financial support to get these projects up and running as soon as possible.

From Churchill, Man., to Quebec to the Maritimes to British Columbia, we should be making plans for LNG terminals and the required pipeline infrastructure to get this valuable and clean resource to market. And Canadians should pray we haven’t totally missed the market.

Susan McArthur is a former venture capital investor, investment banker and current corporate director. She has previously served on a chemical logistics and oil service board.