The New Fortress Energy LNG Plant in Bradford County demonstrates just how much New York State fracking obstinance is costing the Southern Tier citizenry.
Companies, businesses and people continue to capitalize on the shale revolution here in Pennsylvania, while New York’s stubbornness in not allowing access to other American markets in the name of some kind of “moral good” is not stopping it.
Some of you may have heard of the New Fortress Energy LNG plant proposed in Wyalusing right along Route 6.
For those unfamiliar with the facility, the plant is a gigantic $800 million investment that will take in natural gas from the Marcellus Shale and liquefy it for transportation to other markets.
About a month ago, I sat down with Tony Ventello at the Central Bradford Progress Authority, who provided me with some documentation that New Fortress filed with the United States Securities and Exchange Commission that offers some details to how exactly the plant will operate.
Just for starters, Ventello’s interest in the project stemmed after New Fortress approached the Progress Authority asking for a housing study for every lodging establishment – everything from hotels to rental apartments to campgrounds – within 50 miles of the site to see if the region could adequately accommodate the approximately 1,000 temporary jobs that would be generated by the construction of this massive facility. (There will also be 50 permanent jobs when all is said and done.)
Long story short, Ventello was happy to report that the region could comfortably take in all those people. For example, there’s 150 hotels within that aforementioned 50-mile radius.
How can this rural region so easily do that? I imagine it has something to do with all of the hotels and housing establishments that were developed here around 10 years ago when the shale revolution first started. But hey, I’m just spit-balling.
But what I, personally, find more interesting about this LNG plant is where these three to four million gallons of LNG per day are going.
The natural assumption would be New York and New England with their exceptionally high natural gas prices due to lack of pipeline capacity, forcing cold winters to be pretty expensive for consumers.
However, according to the documents filed with the SEC, that’s not where this gas is going.
Specifically, this Marcellus Shale gas is going to terminals in Montego Bay and Old Harbour in Jamaica, and will also be shipped to San Juan, Puerto Rico; La Paz in Baja California; and Shannon, Ireland – once terminals currently planned in those three locations are constructed.
Once shipped to those locations, the gas will be used in natural gas power plants to provide electricity to the regions.
The savings to these countries like Jamaica should be fairly impressive, as Jamaica has dealt with high energy prices due to its seclusion from energy sources. For example, the average cost of energy is about 22 cents per kilowatt hour. For reference, New England power prices were nearly 13 cents per kilowatt hour during the first cold snap of this winter, which is high by American energy price standards.
So, the fact that American natural gas is being exported to another country, bringing at least some stability to an even more volatile market than ours while also benefiting the American economy is just a win all around. Well, except up in New York and further north. Thanks, Governor Cuomo.
There’s more to the New Fortress story, however. While an $800 million facility is impressive by any standard, that’s just the tip of the iceberg.
“We plan to capitalize on this growing supply-demand gap and create new markets for natural gas by developing liquefaction assets, particularly in areas with ‘stranded’ reserves, which we define as natural gas reserves not connected to large interstate or transnational pipelines,” the documents stated. “That is, not only are these reserves not connected by pipeline to end users, they are not connected to any significant pipeline – as is the case in Pennsylvania.”
With that said, company officials in the documents noted that there will be another LNG plant constructed in Pennsylvania, with long-term plans to build five (yes, five) more such facilities.
New Fortress also hopes to have the Wyalusing plant substantially complete by the end of 2020. And while that may seem like a lofty goal, the company has already obtained some of the permits it needs for the project, which will be located on approximately 60 acres in the middle of the 240 acres that the company purchased on the south side of the municipality.
Speaking of which, the economic opportunity that this endeavor presents to Wyalusing cannot be understated and, in my conversation with Ventello, he recognized that projects like these are where Pennsylvania needs to be in the development of natural gas as an industry and as an economic driver.