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FuggleyBrew t1_j9ahtmy wrote

Reply to comment by Timbershoe in Europe's natural gas prices fall to 18-month low by Sebekiz

Natural gas storage is a thing which exists. In fact you even use old, now defunct formations for storage. Quite literally placing natural gas back into old formations building them up again.

>The regulation has been swiftly implemented. In September 2022, the EU had its storage facilities filled by 80% on average. In October 2022, filling level reached 90%. In December 2022, gas reserves started to be used up due to the weather, but as of January 2023, the filling level remains above 80%.

https://www.consilium.europa.eu/en/infographics/gas-storage-capacity/

Gas reserves is the appropriate nomenclature here.

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Timbershoe t1_j9akajn wrote

That’s 15% of consumption at most, and it’s simply giant tanks that are filled from the existing gas and oil fields. Holding areas.

And most EU countries don’t have any storage capacity at all.

You’re confusing the capacity of the distribution network with it being the source. The reason for the increased retention in the network was to force utility companies to buy at the market rate, and not run at low capacity hoping the price would drop.

Gas reserves is absolutely not the right term. You clearly have no idea what you’re talking about and instead are google shit to try and back up your error.

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FuggleyBrew t1_j9bf1hn wrote

> That’s 15% of consumption at most, and it’s simply giant tanks that are filled from the existing gas and oil fields. Holding areas

Also filled from LNG imports, and not just storage tanks, also placing gas back into continental formations. When Europe was increasing it's natural gas storage, this is what they were doing.

>You’re confusing the capacity of the distribution network with it being the source. The reason for the increased retention in the network was to force utility companies to buy at the market rate, and not run at low capacity hoping the price would drop.

The increase in reserves was to ensure that volume was purchased and brought local to Europe because during the winter demand would exceed production and imports, so they needed to store it. They could only achieve this through a combination of lowering consumption and increasing production and import capacity. Europe does not produce enough natural gas to meet its own demand.

>Gas reserves is absolutely not the right term. You clearly have no idea what you’re talking about and instead are google shit to try and back up your error.

You're clearly upset over the distinction between proven reserves and the amount they have in their current storage (the reserve they increased). You know the distinction between the geological reserves and their current storage reserves. You're engaging in this semantics argument solely to cover your own ignorance of the European market.

Want to call it storage? Don't care. You're wrong about the fundamentals.

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Timbershoe t1_j9bkamh wrote

The EU hasn’t increased its LPG storage facilities. That will take years. The distribution storage is natural gas, not LPG.

LPG is held at ports, converted into natural gas then piped into the distribution grid.

Dear god, why are you are tripling down on not knowing the least about the subject, it’s like having a conversation with the dunning–kruger effect.

Some time in the past 12 months you clearly came up with the idea that the EU had no gas or oil fields. That they were 100% shipping all gas and oil in. I corrected you and you’re upset. Just deal with it.

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FuggleyBrew t1_j9bqvmj wrote

> The EU hasn’t increased its LPG storage facilities. That will take years.

The EU increased it's gas storage, not it's capacity but total amount stored. Including storing compressed gas, enabled by purchasing LNG. Had it not been purchasing LNG it would not have been able to fill its storage, had it not decreased consumption it would not have been able to fill its storage.

>LPG is held at ports, converted into natural gas then piped into the distribution grid.

It's pipelines are part of the storage, as are the storage facilities connected to those pipelines.

>Dear god, why are you are tripling down on not knowing the least about the subject, it’s like having a conversation with the dunning–kruger effect.

You're ignoring official sources about what the EU did from the European Union itself.

>Some time in the past 12 months you clearly came up with the idea that the EU had no gas or oil fields. That they were 100% shipping all gas and oil in. I corrected you and you’re upset. Just deal with it

I never claimed that, and you know it. You're plainly ignorant of the very fundamentals of natural gas production and consumption in Europe and are actively spreading misinformation.

  • Europe decreased consumption while maintaining production through high prices, rationing consumption and mandating high storage reserves.
  • Europe simultaneously brought in LNG, because it would not meet it's requirements if it did not
  • The increases in output of some fields are not enough to meet it's full requirement.
  • The Continental EU does not produce enough natural gas
  • Norway increasing production 8% doesn't make up for a 25% shortfall.
  • To meet their requirements they cut back consumption, purchased a massive amount at a premium through the summer, and increased production
  • Next summer they will have to continue the rationing, imports of LNG, and continue looking for new sources

This year we had a mild winter, that's no reason to assume there will be another mild winter next year. Refilling the storage will require ongoing high prices and ongoing rationing (either explicit or driven by the prices), although likely without the peaks being quite as high this time.

It is going to take time for the US and other countries to meet the requirements of Europe. Some LNG terminals are coming online but not enough soon enough and not enough tankers soon enough. Until that works itself out things prices are going to need to stay high and emphasis in North America needs to be on expanding export capacity and building up internal shipping capacity.

Nordstream 1 was 60 bcm/year, Norway increased production 8-10bcm/year. Where do you think the rest of the gap was? A decent chunk of it came from slicing around 10% of consumption back from April to September (note: this is not the benefit of winter).

That consumption cut will likely have to remain for the near future.

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