egretTV blog

Stop Broadwater. This article from The Economist, A More Liquid Market does a nice job of explaining the real reason why Shell Oil risks destroying the Long Island Sound ecosystem by building an offshore LNG plant. I understand it is cheap to build, a clever way to get around permit barriers, and avoids building a more costly onshore plant. Not these, the real reason is it is a bet by a few executives hoping for a big payday (windfall profits). Please read the article but here is the key point: “the surfeit of regasification capacity has created opportunities to divert cargoes to the most lucrative markets”. Recently this scenario occurred in Japan. If there was a disaster (terrorist or natural) in the NYC metro area damaging the onshore energy infrastructure, this would lead to a surge in demand and the golden opportunity to take advantage of higher prices with its offshore LNG plant. This plan by Shell Oil is nothing but people buying lotto tickets with shareholder’s money.

Tags: ecosystem, longislandsound

This entry was posted on Tuesday, June 23rd, 2009 at 9:36 am and is filed under environment. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.