How Michael Smith Built A $14 Billion Natural Gas Plant In Texas | Forbes
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- Опубліковано 14 лип 2024
- Quintana Island is a 7-mile speck of land off Freeport, Texas, tucked in where the Brazos River empties into the Gulf of Mexico. Over the past 200 years, the island has been home to a Mexican fort, then a busy seaport for early Texas farmers, who shipped out cotton. Union ships later bombarded Confederate troops stationed there. In 1900 came the Great Galveston Hurricane, which killed 11,000 in the immediate vicinity and wiped Quintana clean. By the time Michael S. Smith set foot on the island in 2002, it was languishing: a few dozen dilapidated homes, a migratory bird sanctuary and beach, and a brownfield of storage tanks built on fill dredged from navigation channels. “We’d be sinking in the mud if we were standing here then,” Smith says.
Smith has made his own historic mark on the island. Having spent $14 billion, he now owns a controlling interest in Freeport LNG, which chills and exports 2 billion cubic feet of natural gas per day, most of it so-called shale gas, horizontally drilled, hydraulically fracked. At current market prices that daily output is worth some $14 million, on which Freeport collects about $5 million a day in tolling revenue. “We are taking clean American natural gas, adding tremendous value and exporting it to countries that do not have enough energy and would otherwise be burning dirty coal,” he says.
Since becoming operational in September 2019, Freeport LNG has loaded 200 cargoes destined for Japan, South Korea and Croatia, where a single shipment can meet the annual energy needs of tens of thousands. Freeport will export about 15 million tons of LNG this year-the energy equivalent of 130 million barrels of oil-and is on track to book nearly $2.5 billion in revenue. Smith’s 63% ownership in the limited partnership is worth in excess of $1 billion.
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This was very well presented!
Natural Gas almost historic low buy every dip
Natural gas showing momentum..should we add?
Wonderful video 👏 👏..very informative
great video, well presented in a coherent manner. good job Forbes
Natural gas showing momentum..should we add?
Chris is top Lad, what a good teacher
Natural gas showing momentum..should we add?
Great article
Superb Video.
Drillers don’t frack frack crews frack. Drillers drill a hole frack crew frack while wireline goes down hole, flowback flows oil and gas out
Natural gas showing momentum..should we add?
A few months after this video was uploaded, Russia invaded Ukraine, and Europe decided to stop buying pipeline gas from Russia. I'm sure Freeport LNG has contributed hugely in the effort to wean Europe off its dependence on Moscow.
Changing existing infrastructure is expensive and painful.
Superb explanation
thank you Forbes news Germany is building a huge terminal lng all the best I have been promoting LNG
Well spoken.
Wow. 60%??? Just wow...
hes ballin
I now understand why the USA is making such a huge fuss over the Germany and russia pipeline
When our own Gov't cancels a huge pipeline here yet allows others, it shows you what they think of America
Regardless if it favors the US or not depending on Russia is not a good idea.
Natural gas showing momentum..should we add?
Great presentation but let's not go around saying combusting natural gas is good for the environment.
Clean water over coal replacement?
that's a myth fracking doesn't contaminate water as much as coal processes pollutes water....don't be brainwashed!!
More videos like this one!
He wish that isn't crude oil.) How much money he makes from this place!?
Tellurian is coming.
How could it possibly have cost that much more to turn it into an export plant? Crazy world.
reversal of a ton of pipes. and the building of the refrigeration units.... but idk. shits expensive
Because importing and exporting LNG are fundamentally different.
When it comes to exporting, you need to clean the gas by removing CO2, H2S; remove any mercury; remove moisture; remove any heavy hydrocarbons, eventually cooling the gas down into LNG.
When you import LNG, all of the above has been taken care of. This is a fine science and an engineering challenge, so it doesn't come cheap.
Natural Gas almost historic low buy every dip
Great subject WITH very boring music. Sorry!
Natural gas showing momentum..should we add?
The fact that the gas can be compressed to liquid state by a factor of 600x is huge
Texing
Tax incentives. Final answer.
This man is a hero
Natural Gas almost historic low buy every dip
They should use green energy to power their oil reserves. Green energy to power fossil fuels
Lmao that cost a lot of money and takes to much time and it hurts taxpayers
texas already is the largest producer of renewables in the country. i dont know how much more you can ask outside of nuclear. which hopefully gets the space it deserves with some of the coal plant shutdowns that will happen due to the basement prices of natural gas
Maser power plants(the giza pyramid)
#$#$ Forbes flatline rapper one gold,magazinez
Funds mattER
🤑
It will be interesting to see if this can complete with Nord Stream 2.
I built that plant
Just blew up a few hours ago
*We are selling our future*
Imagine if M. Smith invested $14 billion to renewable energy sources. Probably, wouldn't have to worry about natural gas transportation/storage.
LNG is also used as cooking gas all around the world. So transportation is required
Renewable energy is not reliable energy sources and its cost more than conventional energy..
Such as?
@@metaparcel imagine a world with both…who said one or the other?
Natural gas showing momentum..should we add?
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Es sierto fraude no solo ellos si conosieras cuantas organisaciones agencias y personas con cargos an echo muchas cosas y no solo eso capital one y sus socios como Rusia china india y otros q degaron y se fueron para texas y lo q iso capital one es unirse con potencias y solo faltaba menos del año para q los enemigos tuvieran control en la economia de USA pero por presentar q yo estaba loco y Adicto 4 Años asiendome lo q nadie penso es q yo sali ganando 60%china40%Rusia100%capital one le quite sin saber a un problema financiero aUsa
Liquified "natural" Gas is just a nice way of saying just anouther fossil fuel that is part of the emissions problem. Imagine what that 14 Billion could do for new green jobs and infrastructure. How large of an offshore wind farm could that build?
That's very good and true Johnny
Become an entrepreneur or businessman and build it okay
New Green jobs? China makes the majority of solar panels.
Ha, ha, ha, ha, ha, ha, ha, ha, ha, ha!
texas. is the largest. IN THE COUNTRY. renewable energy producer. we already invested billions. and we will continue to. but wind turbines wont solve your emissions problem(especially since you need oil to build the damn things). nuclear will. 14 billion would be a serious downpayment to nuclear a new reactor. nuclear should have been replacing coal. but idiot greens think its gonna blow up the world.
Solar and wind are not full scale options. Nuclear is. Nuclear though would do what it did in France in the 90s, obliterate an entire fleet of oil power plants. Well, Capt LNG here can’t let that happen to his gas empire.
Nuclear too expensive
@@kermit1 No. One new design reactor, built, say, once every 30 years is expensive. Nuclear built in volume is not, with lots of experience to prove it. See France, grid is 95% clean, mostly nuclear, done 30 years ago. Electric rates are some of the cheapest in EU.
Anyway, there are no grids run mostly by solar and wind, not even 50%, not anywhere in the world, nor will there be, because integrating it and firming it up is too expensive.
Natural gas showing momentum..should we add?
@@kermit1 Existing nuclear can produce for less than 5¢ per-kwh, cheaper than virtually all the alternatives.
Nuclear power safe clean economical……. Non of the above !!! People keep forgetting about when the fuel rods are at half life and shuffled out of the reactors and to storage site……. Real safe and clean there 🤦♂️ nuclear disasters never go away
Tldw: he didn't build it, he payed people to build it for him.
Lol.
Investing 101. Never use your own money
Interesting way to frame LNG as the lesser of two evils... still, it's a true shame that Smith's equity investors didn't put those $13bn toward renewables development, which would of course mean a more distant ROI horizon.
What green project are you referring to, the kind that don't work at night or the ones kills eagles and other large birds and don't work when wind is too low or too high and can not be the main power generation because it's too unstable.
@@sszhao11 No mention of Human induced earthquakes from horizontal drilling and fracturing as expected, and did you also forget about the contamination of ground water with toxins!!
Texas produces the most renewable energy in the country. that money already had the chance to get in on the green tech. if you really wanted "green" technology. youd be pushing for the expansion of nuclear. but the only nuclear plant construction in the country is in georgia and it was 6 years overdue and 30 billion over budget. the federal and state governments have been actively trying to kill the nuclear industry. its only a waste because the government literally stops anything better from happening.
Why waste their money on renewables, Renewables are only good if NG is there to produce electricity when the wind dies down and the sun goes down can't get past that. Nuclear is the only reliable round the clock renewable available. NG is here for a long time get use to it,
So how much your gas electricity and food prices since everything is Putin fault... 😆 🤣
What a shame to spend all that money, just to have Elon musk move into your state, and immediately make the 14 billion dollar project completely obsolete
I love Elon and what he does, but money wise, this things is going to be a cash cow that Tesla could only wish for. Think of india, africa, russia... Gas is way cheaper than electricity, and electric vehicles requiere a strong electric grid that is basically missing in most parts of the world. By the time that changes, the infrastructure and business will be paid 100 times fold at least.
@@liberty9404 ha ha. I enjoy coming across comments where people understand energy. Even the guy in the video at the end was hyping solar and wind. I’m like ya bud not gonna happen, solar and wind are great ideas they’re just not going to replace coal and natural gas.
@@IgnisMDB Africa has natural gas, and a lot of infrastructures are currently in construction for harnessing and distributing natural gas
@@kingleonidas4296 there must be people saying cars can't replace horses in 1900s.
@@marshalLannes1769 well if the government never built roads then no, cars would not have replaced horses.
Is the whitest of white Caucasian names in the history of man, Michael Smith
Real estate fraud? ⛽From an oil company? 🏗️
LNG is too expensive thanks to Nord Stream 1 & Nord Stream 2 All of Europe & China can have natural gas for very cheap & efficient from Russia. Micheal Smith u waste a lot of money
Your comment didn’t age well.
LNG right bow is one of the cheapest forms of energy there is. You hook a propane tank to a single burner and a cast iron skillet and see how many steaks you can cook before you run out bro. It will take a while. No waiting for the wind to blow. Not as bad of a winter in many areas it lead to less demand causing oversupply so prices inverted from way up to way low. Natural gas is lit you know it. Lit-terally lyrical, not even satirical. When you turn crude into gasoline it can expire and a gaseous form of storing the energy can store for longer. You put a propane tank next to a gasoline can and see shich one expires first. You eill find the gasoline expires before tgebplastic gas can but the propane tank the metal steel very high standard of build quality for saftey will expire and the acthal propane inside of it wont. So in certain applicatioms you can see how ceetwin forms of the earth lend themselves to certain things. Propane you can hold for longer than gasoline. Methane csn be liquified its cow farts man
The mere existence of this LNG terminal causes the price of domestic US natural gas to be 19% above what it should be by exposing domestic natural gas consumers to international price competition.
Eh, no, thats a static analysis, where you have to assume drillers don’t don’t do anything different when they see that price increase, somehow suddenly have no incentive to drill more w a higher price.
@@Nill757 No, it's exactly what happened when the Freeport LNG terminal exploded and burned. Domestic natural gas prices declined by 16% almost overnight.
@@gregorymalchuk272 of course it did. Same thing happens with any production outage due to a temporary accident, fire whatever, in the short term. Then for any long term change new drilling increases or reduces. It’s tedious to repeat. Will you continue to ignore what production does in response to a new export terminal and price shift, and pretend only your point matters?
A. theres a ton of flaring, so its not like there isnt the production to meet US demand
B. most US gas demand, such as in the rust belt isnt exported
C. the infrastructure to collect and distribute US gas production is too low, so prices naturally hike up as demand outstrips supply