Blog

Pushing the Future into the Future

By Kennedy Maize

Washington, March 22. 2010 — Remember all that hype about a nuclear renaissance? Push it all a couple of years into the future, as the economy has caused growth in demand for electricity to slow considerably, making the need for new baseload capacity less pressing.

In a wire service interview, Marvin Fertel, CEO of the Nuclear Energy Institute, the Washington-based lobbying group for the nukes, said he figures new nuclear plant completion dates are probably two or three years later than forecast. “The recession has decreased demand of electricity everywhere,” he said. New plant predicted to come on line in 2017 or 2018 are now probably “2020 projects.”

But that doesn’t mean a decline in the need for baseload generation, as predicted by Federal Energy Regulatory Commission chief John Wellinghoff. He told an energy meeting last year that new coal or nuclear baseload may not be needed “ever”.  That assertion drew derision from many electric industry analysts.

Outgoing Nuclear Regulatory Commission member Dale Klein, former NRC chairman during the George W. Bush administration, told the NEI recently that Wellinghoff “must have a database that’s much different than mine. I think we will have a need for baseload electrical generation for a long, long time. And the facts are the facts. There is no alternative in the near term for anything other than baseload, because for some reason people want electricity at night. They like to keep lights available, and their homes heated if they have electric heat. So I think baseload electrical generation from everything that I’ve studied, and I’ve spent my career in the energy business since the mid-70s, I don’t know how we can have an electrical generation system without baseload.”
Also looking into the future, Australia, a major uranium producer (the Ranger mine is the largest in the world), is looking for big developments in natural gas. Australia in rich in natural resources, including gold, coal, iron ore, and natural gas. That’s how Aussies came to be know colloquially as “Diggers.”
Now, in the state of Western Australia, which includes the vast deserts of the Kimberly region, gas appears to be ascending the minerals throne. The key is the $37 billion Gorgon project, which Chevron is developing some 130 KM off the northwest coast of the Australian frontier state. The project aims to exploit enormous gas resources in order to ship liquefied natural gas to burgeoning economies in Asia, including Japan, China and India.
In late January, Chevron Australia announced it has signed a major contract (300,000 tonnes per year over 15 years) to supply Gorgon LNG to Japan’s Kyushu Electric Power Co. The first deliveries are estimated for 2014. Earlier, Chevron and Nippon Oil Corp. signed a similar deal for 300,000 tons over 15 years of LNG for delivery to Japan.
Australia is already a significant LNG producer, but some estimates reckon that the Gorgon project could quadruple LNG exports. Chevron says of Gorgon, “It is one of the world’s largest natural gas projects and the largest single resource natural gas project in Australia’s history.” Chevron’s joint venture partners in Gorgon are ExxonMobil and Royal Dutch Shell.
Chevron says it will center the Gorgon project on Barrow Island, which has long been the company’s premier site for oil production. The company notes, “Although rated as one of the most important wildlife refuges in the world, Barrow Island’s ecology remains essentially intact.”