On the web since 1997
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On the web since 1997 |
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The Race Is OnLuke Hodgens / Powerhouse Profits -- Remember the days when a golden opportunity was jumped on by America? We'd take an idea, or a product for that matter, and turn it into something better. America was the king of innovation, numero uno, top dog - but, unfortunately, those days may be numbered. In the Golden Era, America would invent and build better cars, TV's, computers, airplanes, electronics or entire industries for that matter. Today, it seems we're happy to have others do the work while we utilize the product. This is, perhaps, no more evident than in the energy business.America created the oil and gas business over 100 years ago. Today, most oil comes from overseas and our innovation economy shuns fossil fuels. But the fossil fuel business is undergoing some major transformations that America, especially environmentalist groups, wants to stay out of LNG. Liquefied Natural Gas, as the name implies, is natural gas which has been changed from gas to a liquid by reducing its temperature to minus 260 degrees Fahrenheit. By doing this, it occupies a volume of just 1/600 th of that of its gaseous form making it easier to transport overseas. Traditionally, natural gas is transported via pipeline. But with environmental restrictions on our resources, America is looking abroad for natural gas supplies - supplies too far away to transport here via pipeline. The relatively new business of LNG involves multiple stages of transport. First, the gas must be piped into terminals to be liquefied. The liquid is then put in cryogenic tanks on specially designed tankers for transport. When its destination is reached, the LNG is re-gasified at a re-gas terminal, then sent into pipelines for disbursement. The LNG business began to take off recently as the price of a million BTU's has skyrocketed past $7. LNG analysts believe the business is profitable at as low as $4.50 per million BTU. At current prices, LNG is a highly profitable business. It's estimated that U.S. demand for natural gas will increase by at least 2% per year. With our resources currently handcuffed, LNG imports will be taking a chunk of the market. The United States only has four re-gasification terminals. These terminals are located in Everett, MA, Cove Point, MD, Elba Island, GA and Lake Charles, LA. With just four terminals to receive gas, the country is experiencing an LNG bottleneck. There are dozens of proposed LNG terminals across the country but few are likely to ever be built. Environmentalist groups have convinced communities to ban the building of LNG terminals. Although there have been zero spills or accidents, environmentalists, acting especially in California and the North East, have kept the US from hopping aboard the LNG train. Any new terminals will likely be built in Texas and Louisiana where the oil and gas industry is well received by their citizens. But even here, terminal construction has been stifled by local governments and activist groups. While terminals may be built in Texas, they're desperately needed in the North East where natural gas demand is huge. Enter Canada: Eastern Canada is hungry for industrial development. New Brunswick and Nova Scotia have high unemployment rates and are in dire need of an industrial makeover. Canada now wants to build up to 6 LNG terminals along the East Coast to supply the American North East with gas. The Canadians are trying to get approval and build these terminals before terminals can be built in the North East U.S. Proposed terminals in Massachusetts, Rhode Island and the Long Island Sound are more likely to be squashed if Canada beats us to the punch - and this is very likely. In October, Petro-Canada inked an agreement with Russia's Gazprom to study the viability of transporting LNG from St. Petersburg, Russia to Quebec, Canada for sale in the United States. This deal will effectively cut a vast number of American workers and companies out of the loop. So, the race is on. Will the North Eastern activists allow us to build terminals before Canada does? Will they allow American workers to benefit? Not likely. LNG is the newest wave of energy innovation, yet America will likely be left behind on this one, at least for now! I've been following the LNG wave for about two years now. I know the ins and outs of the business and have picked some big winning stocks in the industry. One of my picks is up over 200% to date and will likely go to 320% within the coming weeks. In fact, this particular stock is up over 16% today alone. If you're interested in this dynamic growth business, please go to www.powerhouseprofits.net to learn more. Luke Hodgens is the editor of |
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