Guest Post: WSF and Liquid Natural Gas

TRANSPARENCY NEEDED: WHAT IS WASHINGTON STATE FERRIES’ REAL LIQUID-NATURAL-GAS AGENDA?

By Forest Shomer

Since December 2012, Washington State Ferries (WSF) has repeated and publicly stated that it is “exploring” a conversion of part of the ferry fleet to liquid natural gas (LNG) fueI. After five months of “exploring” we know that WSF has sought and secured Coast Guard permissions for some of the steps required to make that conversion. The full story remains under wraps.

The key, unspoken element during these past five months, is the purchase price of the LNG fuel. Will that price result in a savings on the WSF balance sheet over current petrofuels? Will the savings be sufficient to retire the capital cost of converting existing systems over to LNG and in how many years? In large part, the answers depend on what LNG fuel source(s) is accessed. By what natural gas pipeline that exists today, can WSF get LNG right to a refueling point for the six ferries that are proposed for conversion?

How can WSF not identify the source of the LNG? It will either come from Canadian Tar Sands or from fracked Wyoming sources. They are both objectionable. (Alaskan LNG is reportedly insufficient to extend to fueling our ferries.) WSF may not know at this moment which source would be drawn upon, on a given date a year or two from now, but after all these months of “study” they surely know the full extent of probable sources for this fuel.

Fracked natural gas from Wyoming is conveyed westward via a line that terminates at Klamath Falls, Oregon. The line was projected to extend to Coos Bay to a LNG saltwater terminal from whence the gas could be sold to Asian markets. It would have required extensive eminent-domain takings and five major coastal river crossings (including the Wild and Scenic Rogue) to reach Coos Bay. It has now been reported that the push for a Coos Bay terminal is being abandoned. (But not officially ‘dead’ yet.) WSF appears to be a potential major customer, even though the fuel would have to be trucked hundreds of miles via mostly 2-lane roads. The payoff of (maybe) reduced fuel costs and less-particulated Puget Sound air would be offset by the expense and hazard of highway trucking, ironically via diesel tanker trucks leaving elevated particulates along a lengthy highway corridor. A much smaller and less politically advantaged human population would be inhaling particulates that Puget Sound residents would not.

Canadian Tar Sands are implicated in three major spills that have occurred during the week of April 2-6 in three different states/provinces! You may have heard or seen images of the very large Arkansas spill being ‘cleaned’ with paper towels–even though major media have barely mentioned it, and reporters were banned from the immediate area for several of the worst days thanks to Exxon’s political clout in that state. Then there was the large spill on the Red Lake Reservation in northern Minnesota and another spill north of the border. Shall WSF become a direct consumer of Tar Sands products as well?

Liquid natural gas from Alberta is a byproduct of Tar Sands oil production from bitumen–the dirtiest fuel on the planet. It would be brought to the Vancouver area by a new Kinder Morgan pipeline from 700 miles across the Canadian Rockies. Then it would need to be conveyed further to WSF’s refueling locations. The real goal is export of Tar Sands LNG to Asian markets. Having a customer like WSF (and quite possibly BC Ferries) would substantially help massage the numbers Kinder Morgan needs in order to get approvals to build the new pipeline.

Without a Kinder Morgan LNG line, the back-up strategy appears to be the much-opposed Enbridge fuel corridor across northern BC. Coastal First Nations affected by Shell Canada’s proposed LNG terminal at Kitimat say air quality and the number of vessels that will pass through their fishing grounds are emerging as the main issues they want to see addressed if the $12-billion-plus project is to go ahead.

It appears that without one of these environmentally (and politically) objectionable LNG fuel sources, WSF has no real chance of financially justifying conversion to LNG powered ferries. The entire shaky proposal, of spending $85.6 million to convert six Washington State Ferries of the Issaquah Class, rests on a $2.00/gallon differential in the price of oil and the price of future LNG. If the actual cost of LNG turns out to be higher, for example if foreign buyers outbid domestic buyers and cause the price to rise, the proposal collapses. But once converted, WSF would have no real choice but to buy LNG at the going rate.

Read this New York Times article on the supposed cleanliness of Tar Sands LNG.

WSF should come clean with this information about their supposedly clean fuel conversion. Concealment as is their practice right now, fuels alarm that decisions have already been made that are being kept under cover until the last possible moment.

Forest Shomer was appointed in 2004 to serve on the Keystone Citizen Advisory Group to WSF. He lives in Port Townsend and was a founding member of the regional citizens group, Ferry Community Partnership.

Additional links:

Image of Suncor Refinery, Alberta CA

WSF – Liquified Natural Gas

Canadians Fear Spill from New Kinder Morgan Pipeline, Tankers

Massive Gas Explosion Rocks Texas Neighborhood

BLEVE Gas Explosion

Ferries to spend $85.6 million to Begin Conversion to Controversial Fuel Source

First Norwegian Electric Ferry Sets Sail

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About sjbrooksyoung

Susan Brooks-Young has been involved in the field of instructional technology since 1979. She was one of the original technology users in the district where she taught and has continued to explore ways in which technology can be used to facilitate student learning. She has worked as computer mentor, technology trainer, and technology curriculum specialist. Prior to establishing her own consulting firm, Susan was a teacher, site administrator, and technology specialist in a county office of education in a career that spanned more than 23 years. Since 1986, she has published articles and software reviews in a variety of education journals. She is also author of a number of books which focus on how school leaders can implement the NETS*A Standards. Susan works with educators internationally, focusing on practical technology-based strategies for personal productivity and effective technology implementation in schools. Susan and her husband live on Lopez Island, WA.

2 thoughts on “Guest Post: WSF and Liquid Natural Gas

  1. Randall Waugh

    Hey Forest, Thanks for the informative article. I shared it on Facebook. I have not read about getting the ferries hooked on LNG to further grander schemes to sell fuel to the Far East markets in the local papers.

    Reply
  2. Adrienne Adams

    The price disparity between diesel fuel and LNG is already starting to slip. WSF started talking about LNG two years ago, when LNG was trading at an all-time low of $2 mcf (million cubic feet). Last summer, when the article below was published, the price had increased to $3 per mcf. Right now the cost is close to $4/mcf. At $2/mcf, it was costing more to get the gas out of the ground than it could be sold for; selling at a loss isn’t a very sound business strategy, so prices had to rise.

    See this article for a more detailed analysis of the prospects for natural gas prices in the near term:
    http://www.forbes.com/sites/richardfinger/2012/07/22/were-headed-to-8-00-natural-gas/

    Pretty soon the fuel cost savings argument for switching to LNG will likely evaporate.

    Reply

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