Energy infrastructure

Security of supply does not mean in the event of WW3 or a strike on moffat - any number of issues could occur to impact the flow or purchasing of gas from Norway to here. The fact remains that having all our eggs in one basket is not good for a number of reasons.

Development of our own fields is the most preferable option, but after that an LNG terminal absolutely should be considered. And the idea that if it doesnt bring gas prices down (based on current prices) that it shouldnt be built is silly - plenty of strategic infrastructure is loss making or not directly profitable.

The interconnection is not all owned by GNI. Anyone can import gas on the GNI owned interconnector, GNI don’t trade in gas at all. The local distribution network is a monopoly no matter who owns the intake points.

The LNG terminal operator and the shipper are going to take the difference between the LNG price and the price of onshore gas as a profit for themselves. They are not going to pass the saving on to the punter.

re how other countries do it, they build an appropriate number of terminals to meet requirements. They avoid over-serving the area, especially when gas demand is expected to decline. They also build storage to cover gaps in supply.

Well, the issue for Shannon LNG was they wanted to import gas without using the interconnector, but they were still expected to subsidise it by paying whatever levy that other importers pay. I asked before what has changed, and nobody had an answer, but maybe there is so much profit to be made from LNG now, that they are happy to pay it?

That depends on how the market is setup, but suppose it is the case, then presumably LNG infrastructure is not a cost that the consumer has to bear. It funds itself because it's just sourcing the product so much cheaper. And if it's the case that LNG operators have to pay the GNI interconnector charge then that means it's not affecting GNI's costs so what's the problem? We would have a third source of gas at no cost to the consumer.

That doesn't answer how they manage the difference in price from different sources. Like I said above, someone should look into it independently. The energy review we just had wasn't given the right terms of reference.

I think the question asked was fair and neutral. Your alternative is nonsensical. Why would LNG be the "most expensive" and why would it "lock the country into gas usage instead of transitioning away from fossil fuel usage"?

What you mean is that the processing costs are higher, but if the raw material such as gas from the US is much cheaper (as it is) than piped gas from Europe then that more than compensates for the processing costs.

The bottom line is that this is a private sector investment. Why do we care whether it works or fails now or in ten years time? Is it because we want gas to be as expensive as possible for ideological reasons right now?

How can the auctions commence when none of them have planning yet??

It's not as expensive as no gas and the rest of Europe don't agree with you.

"“Around 25 new FSRUs, according to estimates from S&P Global Platts, are now expected to be installed across the EU in the coming years, with the first facilities set to be operational already by the end of 2022 facilitated by a combination of political and commercial will in accelerating work,” Illardo said.

“Germany in particular, arguably the EU state most impacted by Russian natural gas disruptions, has accelerated LNG developments in recent months with new regulatory initiatives that include a new law designed to accelerate the approval process for new LNG import terminals and lower feed-in tariffs at LNG terminals,” Illardo added." https://www.rigzone.com/news/europe_rushing_to_install_new_lng_import_facilities-29-aug-2022-170138-article/

Of course if ER would stop preventing the search for and exploitation of NG, perhaps the issue of energy security and need for an LNG terminal would be less acute.

That energy security report is going to be a hoot.