Column: Energy prediction in 2023? Instead, when Canada provides LNG-strapped Germany with a pencil drawing of green hydrogen plans, don’t bother predicting anything.

From BOE REPORT

Terry Etam

Happy New Year to all, even though 2023 is going well. The Type A people have set goals for the year 2023 and are certainly pursuing them with vengeance. (We) Type B people are currently wandering aimlessly around gyms, rationalizing unfinished goals and disturbing the average person by dozing off on the equipment.

In the energy world, resolutions give way to predictions. Everyone makes them, that’s okay – it’s good to hear other people’s thoughts, but fake accuracy and robustness can drive you insane. A quick Google search for “energy predictions 2023” yields results – Forbes (business as always bold): “8 Consequential Energy predictions for 2023.”

Wood Mackenzie (global consulting firms that put food on the table/Ferraris in the garage by creating an aura of well-prepared omniscience): “Ten predictions for 2023.” The Motley Fool (investment website): “3 bold oil market predictions for 2023.” Gizmodo (pop culture website with the motto ‘Tech.Science.Culture’ and therefore certainly deep energy thinkers on pop culture): “Next Year in Energy – In 2023 , we will see the first real movement in the global energy transition.” Tell us all about it, culture house. And completely ignore the fact that oil, gas and coal are all at record consumption.

The clickbait headlines didn’t interest me except for Gizmodo, ironically – their predictable low-intensity/low knowledge attack on hydrocarbons is of more interest to most because it fits political thinking The West. They may not know anything, but we need to pay attention to these columns. You may be in an auditorium with hundreds of towering minds, but you will give your full attention to a single idiot if he has a bomb on his head.

Ironically, hydrocarbon haters provide the most clues to the future because they write what lawmakers enact – a scary, but true, thought (more on that in a moment).

As for the real energy world, I don’t know what will happen.

Several things seem possible – Russia will obviously continue to be Russia, igniting a murderous but messy road (apparently they are ‘replenishing’ the army with half a million sacrificed sheep other reluctant), intensely interested in something that makes sense in their brains and no one else’s. The entire fight was almost unthinkable as if the craziest guy on the internet had been given an army.

Russia could have used the money that destroyed Ukraine to build an impenetrable wall and save hundreds of thousands of lives and suffering, but chickens didn’t write novels either.

On the energy front, the invasion is forecast to upset the global energy market like no other. A year ago, there were many predictions about how many million barrels of Russian oil per day would be lost from the world market, because who would want to deal with it? that thing.

It turns out many will be – Russia’s oil production, after a brief slump in the spring of 2022, ended the year at a flat rate. same production level until 2021. Russia closed the gas pipeline to Europe (Nordstream 1) as a bargaining chip, then someone mysteriously blew it up for good (still miss you SCTV). Those events were supposed to be even more gruesome – I certainly thought so – but then strange things happened like Germany built an LNG terminal in 5 months. Did not see that will come.

China stuck with its strange Covid-free policy for much longer than anyone imagined, even the communist party leadership seemed a bit confused as the well-controlled population started torching makeshift camps. confine and destroy the obstacles. Limit found.

Now that China is reopening at breakneck speed, which will impact hydrocarbon demand, unless something else significant happens, which seems more likely. At least that’s what commodity futures are saying, with both oil and gas prices showing significant weakness recently.

By the end of 2021, Europe is facing a natural gas crisis – long before Putin’s invasion – due to a lack of available supply, which should theoretically be one of the big stories of 2022. However, the EU decided it still loved natural gas and got into action, buying any and all available LNG (Japan says LNG will be sold out until 2026), and launching out trillions of new fossil fuel subsidies (which is ironic) to keep their citizens from rioting.

Germany must have set some records in building an LNG import facility in five months, which will go down in history when the time of the “rapid energy transition” proved to be a complete farce. that every serious/informed person in the business knows. it will be.

Speaking of farce, a recent vacation took me to one of those places where one ends a useless but relaxing day with a bit of TV, and the TV choices are BBC, Fox News or CNN/MSNBC. Fox, CNN and MSNBC are horrible; revolving around them was like a conversation with a divorced couple they hated each other, so I found the BBC hoping for something a little more brainy – a year-end interview with Greta Thunberg herself .

Well, it beats listening to Bickersons; It’s good to hear opinions that contradict your own. Who knows, maybe I missed something appropriate and changed the frame.

No. Opposite; My initial reaction was perplexity, that such a locomotive was launched as a global symbol of hope. The BBC interviewer herself is sometimes confused when Greta responds to a typical question about climate policy with chuckles that double her for an uncomfortable long period of time (in some cases). point, the serious interviewer asked how such a question could cause uncontrollable laughter, to which he received no helpful response).

Greta also deflected any possible policy questions – the interviewer, of Indian descent, asked his mother if it was wrong to fly over to meet him; Greta replied, “Of course not, people should do what they want.” (Huh? Like driving a gas car?). The interviewer pressed her to support or condemn nuclear (she refused, because if she took sides, “people would focus on that, not the climate emergency” ( Another problem huh?).

But as I watched the interview come to an end, any mockery was replaced with obvious pity. Greta is just a child. A child is terrified by the adults around her, so terrified that it is her life’s mission to fight the demon her leaders have convinced she is living under her bed.

The interview left me with an uneasy sense of injustice towards Greta, a young man who was truly afraid of the future and who had weaponized that fear as a cornerstone of the activist’s marketing strategy. global movement.

The only reason for giving the interview was because of its direct connection to the Gizmodo article, which connects directly to the current lack of wisdom policies we see our management publish. The most striking and obvious example (among many candidates) is Trudeau’s announcement that there is no business case for sending Canadian LNG to Germany, and Canada will help their desperate Teutonic friend by providing level, ta da, blue hydrogen. (Shortly after, Germany signed an LNG supply contract with Mexico, a country that doesn’t even have enough gas to export, but is wise enough to get US/Canadian natural gas on board ships via Mexican ports and pipelines), Trudeau’s proposal is startling because its shameless and callous stupidity; it will take all three levels of Canadian government a decade to develop the regulatory framework and challenges for any green hydrogen production; there is no existing mechanism or infrastructure to transport hydrogen to Germany; and Germany nonetheless have the same tools as Canada, maybe even more – lots of renewable energy, water and a motivated workforce (our government’s rationale for why why it makes so much more sense for Canada to develop an entirely new industry that doesn’t exist anywhere on earth now) rather than building LNG pipelines and ports).

Unfortunately and shockingly, the absurdity of Germany’s visit/rejection is the best guide to what 2023 could bring. Major energy policy decisions are being made without common sense and associated expertise.

The world is in an energy crisis – global demand for natural gas, oil and coal is at all-time highs, the industry has remained an abandoned investment for many years. sectors and poor countries cannot compete with rich countries in the fuel of their choice – and Western leaders still set foot on the energy transition even though the wheel is out of their hands. It is good to finance the development of new technologies, but importantly, this is an addition/enhancement to/of the existing energy system, not a replacement. 29dk2902lhttps://boereport.com/29dk2902l.html

I thought a real energy crisis would break the spell the Western leadership is on, but that doesn’t seem to be the case – not until it hits the homeland hard. .

In North America, especially with natural gas, consumers and industry are greatly benefiting (and producers are suffering) from not being able to sell our natural gas at a low price. Global. As a result, North America currently has a somewhat artificial advantage over the rest of the world.

With the right infrastructure, North America can go a long way to meeting global LNG demand, and NA producers will find prices strong enough to encourage growth but still below global prices ( unless LNG terminals spring up like dandelions). Furthermore, NA producers are moving ahead with their emissions reduction plans at breakneck speed – both the United States and Canada, within the next few years, will see the backbones of carbon sequestration centers develop. born in industrial centers from the Gulf of Mexico to Fort McMurray. The pace of these developments is dizzying, considering the challenges of building new infrastructure. But that’s why any ‘energy transition’ has to start with the full weight of the hydrocarbon sector behind it and be integrated with it – because that sector includes the base. trillion dollar infrastructure is ready. Remember the word “reuse” in “reduce, reuse, recycle”, people…

The lack of affordable energy is a wrecking ball that will destroy economies wherever it is impacted. Warm weather brings comfort for a while; Europe currently looks fine on natural gas for the winter. Problem solved!

I look forward to 2023 with sick passion, when the resilient forces of reality deliver powerful blows to what history will show as the worst energy architects. world. I guess it’s a prediction… but I’ll stick to it; it’s hard to envision a more viable path.

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Read more insightful analysis from Terry Etam here, or email Terry here.