Speaker 1: With Laurent's segle End from London and Gerard Reed from Berlin.
Speaker 1: This is redefining energy today.
Speaker 2: On really think in LG we're going to talk about
Speaker 2: LNG liquefied natural gas and wonder if we are, as
Speaker 2: the oil and Gas company say, into the golden age
Speaker 2: of gas.
Speaker 1: Or something else, and that's something else around could be
Speaker 1: that we actually have a boom in the next few
Speaker 1: years and then a complete bust as we've got a
Speaker 1: glot of everything across the whole gas industry, from LNG
Speaker 1: capacity to energy ships to gas itself.
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Speaker 2: Back to the show, Yes child, So if I look
Speaker 2: at the statistic provided by the IA our friend Greg Molnar.
Speaker 2: He said that this year, in two twenty five, the
Speaker 2: FIDS for new liquefaction capacity will reach fifty five million
Speaker 2: tons peranum. I have no idea what that means, but
Speaker 2: what I do know is that it's the second best
Speaker 2: year for FIDS, second only to two nineteen. That means
Speaker 2: that the industry is going gangbuster. And the last example
Speaker 2: we had was last month fourteen billion dollars USD FID
Speaker 2: for Sempra Portart number two, mostly financed by Blackstone, KKR, Apollo,
Speaker 2: Goldman Sachs. So even Wall Streets is extremely bullish on LNG.
Speaker 1: Yeah, but I think we both agree around that there's
Speaker 1: probably a lot of risks out there, and we think
Speaker 1: it's time to actually have a really open conversation in
Speaker 1: and around the global gas market in the next few years,
Speaker 1: which is why we decided to bring a great guy
Speaker 1: in justin Mecalca. Do you want to talk a little
Speaker 1: bit about him.
Speaker 2: Yeah, So, first of all, it's not a NOI lobbyist,
Speaker 2: so we're going to have a really good conversation. Is
Speaker 2: for me, one of the best experts of that old universe.
Speaker 2: He has been investigating and reporting on the energy sector
Speaker 2: for decades, publish a regular insight called powering the Planet,
Speaker 2: and he is currently served as communication director at oil
Speaker 2: Field Witness, which is a US based nonprofit that is
Speaker 2: tracking gas with an emission.
Speaker 1: Let's play them on the show. Justin's great to have
Speaker 1: you on the show.
Speaker 4: Thank you. It's great to be here.
Speaker 2: So Justin, we are between two, say our week and
Speaker 2: have something to say about our week? Before I ask
Speaker 2: you the first question, I like to sing something. Because
Speaker 2: they asked me to come next year. I was thinking
Speaker 2: and a song came to my head, and that song
Speaker 2: is they wanted me to come to sera week and
Speaker 2: I say no, no, no gravel in front of oil
Speaker 2: lobbies and I say no, no, no. First question. The
Speaker 2: narrative of the fossil free industry is the following year
Speaker 2: we're going to have a continued use of fossil fuel,
Speaker 2: particularly LNG. Is the golden age of gas doubling the
Speaker 2: next ten years while aill continue to growth and of
Speaker 2: course a price is supported by geopolitics. And if I
Speaker 2: look at the investment in the US in allergy terminal,
Speaker 2: it's absolutely phenomenon I in doubling the production. So Justin
Speaker 2: you're here to help us dismantle that narrative. Why do
Speaker 2: you think it's wrong?
Speaker 4: First, I want to say it makes a lot of
Speaker 4: sense for the industry to be pushing this narrative, especially
Speaker 4: as we're seeing oil demand in China plateauing. If you
Speaker 4: want to talk about growth in the fossil fuel industry,
Speaker 4: it's gas, and so they have to make everyone believe
Speaker 4: that this is where the growth is. But what we
Speaker 4: are seeing, and actually more rapidly than I expected, China
Speaker 4: has stopped buying LNG and their demand has been going
Speaker 4: down year over year. We're also seeing that in India.
Speaker 4: We're seeing that in a lot of different countries. So
Speaker 4: right as we're being told by the industry we are
Speaker 4: about to enter the golden age of LERG and gas,
Speaker 4: we're seeing a lot of countries around the world who
Speaker 4: are the buyers of this product choosing alternatives. And what
Speaker 4: I've been arguing is this has very little to do
Speaker 4: with people wanting clean energy. It's all about the economics,
Speaker 4: and if you're looking at power generation, LERG is pretty
Speaker 4: much your most expensive option. So while it's fully understandable
Speaker 4: the industry wants us to think this, it's not what
Speaker 4: we're seeing happening playing out in the world right now.
Speaker 2: For me, the China market is gone. They signed the
Speaker 2: power of SIBAA number two. They're going to extend the
Speaker 2: Central Asian Pipeline from Turkmenistan, and I'm pretty sure they're
Speaker 2: going to get guess at what threefold on OMMBTU, So
Speaker 2: there's no way Energy can compete because geez always the digit.
Speaker 4: Yeah, China is very fascinating right now. The messages we've
Speaker 4: been hearing from the industry again, are they expect growth
Speaker 4: in China. Exxon recently said from maritime and trucking uses,
Speaker 4: and we already see that in China batteries are winning
Speaker 4: out in long haul trucking. If you're pinning the future
Speaker 4: of your LNG business on maritime use from the Chinese market,
Speaker 4: it starts to sound pretty desperate. And there was an
Speaker 4: article recently from Bloomberg basically saying that if you're expecting
Speaker 4: more demand from China for LNG, you're going to be disappointed,
Speaker 4: something I've been saying for a while, but it's very
Speaker 4: interesting to see that showing up in publications like Bloomberg.
Speaker 4: At this time, it's.
Speaker 5: Just an I go along with the view that, Look,
Speaker 5: what we've definitely are close to seeing is peak fossil
Speaker 5: fuel demand. And obviously we've seen this in the Western world,
Speaker 5: and I can imagine obviously a dead right. I think
Speaker 5: China we're very close to as well, and I can
Speaker 5: imagine that in the etcetera, etcetera, they'll follow China right
Speaker 5: and then electrify.
Speaker 1: As much as possible. I can see that. I'd like
Speaker 1: to hear your thoughts on the supply side, in otherwids.
Speaker 1: When you look at the supply of gas oil, how
Speaker 1: do you see this? And obviously this has huge implications
Speaker 1: because if you get this wrong as an investor, my god,
Speaker 1: you're going to lose a huge amount of money.
Speaker 4: So how do you view this well, I'm certainly on
Speaker 4: record saying that people investing in building more LNG export
Speaker 4: capacity for the US right now are going to lose money.
Speaker 4: And one of the main arguments I'm making is that
Speaker 4: is tied to the supply. A lot of the people
Speaker 4: making these investments appear to be working under the illusion
Speaker 4: that the US has an endless supply of cheap gas,
Speaker 4: and the markets have been very shaped by the fact
Speaker 4: that the Henry Hub, the price of gas in the
Speaker 4: US has been extremely low for the past decade, well
Speaker 4: below historical norms, and people have now seemed to have
Speaker 4: accepted that that's how it's going to be going forward,
Speaker 4: which might be the case if we continue to produce
Speaker 4: so much of this gas, but we're reaching the limit
Speaker 4: of that, and what we're going to run into if
Speaker 4: they are able to find markets to export the amounts
Speaker 4: of LERG they're talking about in the next five years,
Speaker 4: there will be gas shortages domestically in the US. So
Speaker 4: the prices of US domestic gas are going to go
Speaker 4: way up, which seems to be just a problem for
Speaker 4: US industry and US consumers residential consumers. But where that
Speaker 4: becomes a real problem if you're an investor in LNG
Speaker 4: exporting is the price of your lergy exports is also
Speaker 4: tied to the Henry Hub price. And so when we
Speaker 4: get a shortage of gas in the US in these
Speaker 4: coming years due to the huge increase in energy exports,
Speaker 4: it's going to raise the price of US LNG. And we,
Speaker 4: as US, our LERG prices are already some of the
Speaker 4: highest in the world. So from an investment standpoint right now,
Speaker 4: investing in increasing US LERG export capacity seems to be
Speaker 4: very risky for a lot of reasons, and one of
Speaker 4: them is tied to the limitations of supply.
Speaker 5: Can I follow on more specifically on that, and just
Speaker 5: as what you're sort of saying is that we're near
Speaker 5: peak production in the US in terms of gas. In
Speaker 5: other words, what you're sort of saying is that if
Speaker 5: I look at the Permium basis and you look at
Speaker 5: marshallis what you're saying is the supply of that is
Speaker 5: just going to fall down like that, right, And that
Speaker 5: means you need to go to new places and where
Speaker 5: you go to is going to be just more expensive.
Speaker 1: Is that the way you look at it?
Speaker 4: Yeah, I mean we're seeing peak production the Permian right now.
Speaker 4: And one of the reasons we've had so much cheap
Speaker 4: gas in the US for the last decade is a
Speaker 4: lot of it is associated gas, So it's gas that's
Speaker 4: coming out of the ground in Permian oil wells and
Speaker 4: in other oil wells. And as the economics of oil
Speaker 4: are going south very quickly in the US and we're
Speaker 4: expecting fifty dollars prices next year, US oil production is
Speaker 4: going to slow down. This is also partly due because
Speaker 4: they're running out of the Tier one assets in the shale.
Speaker 4: US oil production is going to go down anyways, but
Speaker 4: gas production will be dropping in the permium. The associated
Speaker 4: gas production Marcellis has limits. So what they're talking about
Speaker 4: is the Hainesville, and they're certainly gas in the Hainesville.
Speaker 4: They require much deeper wells. I've seen price estimates of
Speaker 4: thirty million dollars as well, which means you require much
Speaker 4: higher gas prices to make that work. The reality is
Speaker 4: there's plenty of oil and gas left in the ground
Speaker 4: and in the shale. It's just very expensive to get
Speaker 4: to And if you want to compete on the global
Speaker 4: markets with renewables, which is what's dominating power generation, and
Speaker 4: you want to do that with an ever increasing cost
Speaker 4: of your product, it's not a good long term strategy.
Speaker 2: When I look at the LNGNG xposector in the US,
Speaker 2: first you have to admit it's an extraordinary induscale success
Speaker 2: because they went from zero to right now, they're on
Speaker 2: track to build twelve terminals operational within the end of
Speaker 2: the decade. And right now LNG represents sixteen percent of
Speaker 2: US gas production and they want to go to thirty percent. Now,
Speaker 2: I I can understand some guys say, look, the price
Speaker 2: a herbal negative, so you know, we still have a
Speaker 2: lot of cheap gas. But it's crazy to think that
Speaker 2: they can expose thirty percent of the US gas consumption
Speaker 2: without any impact on prices all do you see this way?
Speaker 6: Yeah?
Speaker 4: It's not just me. I mean there are other people
Speaker 4: who have been saying this, like all of these things
Speaker 4: you're predicting can't possibly happen. It thirty percent of US
Speaker 4: gas is being exported, that's going to be taking away,
Speaker 4: and this is at a time which I don't believe
Speaker 4: all of this will happen due to a lot of
Speaker 4: different factors. About building out gas power generation for data
Speaker 4: centers in the US, that is a big story right now.
Speaker 4: They're saying we're going to put a lot of gas
Speaker 4: towards this. Where's that coming from? If you're exporting thirty percent,
Speaker 4: All of the scenarios they're pushing forth lead to much
Speaker 4: higher gas prices in the US, which means US LNG
Speaker 4: becomes more expensive. So something has to give. And the
Speaker 4: argument I've been making is LNG is already too expensive.
Speaker 4: In India, they're saying we'll buy your own if you
Speaker 4: cut the price in half. Then it becomes competitive. And
Speaker 4: what the dynamics of what's happening in the US right
Speaker 4: now is they're looking to drive gas prices higher, which
Speaker 4: makes US l G more expensive. At the same time,
Speaker 4: there's plenty of gas in other areas that are going
Speaker 4: to be producing at much lower cost at LNG that
Speaker 4: will be competing with the US. But from a US standpoint,
Speaker 4: the first piece to fall in the global LNG bubble
Speaker 4: or mirage is going to be the US for a
Speaker 4: lot of different reasons.
Speaker 5: Party way does one other thing as well, which is,
Speaker 5: at the end of the day, pipeline gas is the
Speaker 5: cheapest way to transport that, and you're seeing China obviously
Speaker 5: come into agreements with Russia in terms of building new pipelines.
Speaker 5: At some point in time, You're probably going to see
Speaker 5: Russian gas coming into Europe as well, so that obviously
Speaker 5: then puts even more pressure on LNG.
Speaker 4: Right Yeah, the pipeline from Russia to China. When that
Speaker 4: was announced, my comment was, I'm sure glad I just
Speaker 4: didn't loan fifteen billion dollars for a new LNG export
Speaker 4: terminal on the US CUS Host because those aren't going
Speaker 4: to be built for years, and they'll be coming online
Speaker 4: when if that pipeline comes to fruition as they plan,
Speaker 4: they'll be competing directly with that. And as you point out,
Speaker 4: the economics aren't even close.
Speaker 2: Now there's an element I've read and highlighted by one
Speaker 2: of the best experts of gas. I'm in there too,
Speaker 2: the scept Kennedy, and but the other ones that I right, Joseph,
Speaker 2: and he said that the people who contracted long term
Speaker 2: USL and G are traders, so in fact it's not
Speaker 2: even the final destination. So those people will have to
Speaker 2: resell the gas. They've taken the bet that the market
Speaker 2: will be short, and maybe it was, and maybe Europe
Speaker 2: will never touch Russian gas again. I go back to
Speaker 2: my discussion with the guy from Enron twenty five years ago.
Speaker 2: The balancing point is six dollar up a gichedule, so
Speaker 2: six doll up and METU. If you're below you're going
Speaker 2: to use gas, and if you're above, you're going to
Speaker 2: use whatever else you have, whether it's called ornable. And
Speaker 2: if I look at the price the TTF, so the
Speaker 2: important price in Rotterdam or at eleven dollars. This this
Speaker 2: is a very very expensive fuel. People don't talk about
Speaker 2: climate that people took about affordability. As you said, it's
Speaker 2: a very expensive fuel, and some guys magically think which
Speaker 2: is going to swallow it and say thank you, thank you,
Speaker 2: mister President. My opinions is not going to happen.
Speaker 6: Yeah.
Speaker 4: If you look at the volumes of LNG that are
Speaker 4: contracted that are from traders or for large oil companies
Speaker 4: who for their internal trading, you're setting up a situation
Speaker 4: where we're going to have a lot of people looking
Speaker 4: to trade LNG, but no one looking to purchase it.
Speaker 4: And there's an example that just recently happened where one
Speaker 4: of the largest gas producers in the US EQT just
Speaker 4: signed a contract to buy exported LNG from a US terminal.
Speaker 4: So we have a US gas producer agreeing to buy
Speaker 4: US gas. They're essentially signed a contract to buy their
Speaker 4: own product. That to me is such an indication of
Speaker 4: where the industry we're in a at the end stage
Speaker 4: of this hype or bubble or mirage of the LNG
Speaker 4: when US gas producing companies because they're going to have
Speaker 4: to trade that, I see a scenario ten years down
Speaker 4: the road where we're going to have a lot of
Speaker 4: people with a lot of LNG contracted who are looking
Speaker 4: to trade with each other, but there are no end users.
Speaker 1: So just to what you're sort of saying, is that
Speaker 1: what we're going to see is substantial levels of stranded
Speaker 1: assets in this space.
Speaker 4: I don't see any way that doesn't happen. There are
Speaker 4: so many factors that are lined up to make that
Speaker 4: scenario the most likely outcome, especially with the US, and
Speaker 4: you're seeing it in the media now. Some people are
Speaker 4: starting to say, well, it looks like we're going to
Speaker 4: have a glut. Everyone's pretty much agreed there's going to
Speaker 4: be a glut. Other than perhaps CEO of Exxon and
Speaker 4: the CEO of Venture Global, we are going to have
Speaker 4: a glut. There's going to be a lot more on
Speaker 4: the market. Everyone talking about that pretty much is agreeing
Speaker 4: that the first local economy to suffer the impacts of
Speaker 4: that will be the US due to the various economic
Speaker 4: factors involved. If there are going to be stranded assets,
Speaker 4: I expect they will be on the Gulf coast, the
Speaker 4: US or Canada. Canada isn't making smart moves here either,
Speaker 4: and now they're talking about trying to build export terminals
Speaker 4: in Mexico. The justification to that is to take permian
Speaker 4: gas from Texas, get it to the west coast of
Speaker 4: Mexico and sell it to China. Do you want to
Speaker 4: be trying to sell China LNG five years from now?
Speaker 4: Those assets, if they are built, they will be stranded assets.
Speaker 2: You name one of the company which is not very
Speaker 2: dear two European traders is Venture Global, which is the
Speaker 2: second biggest developer after Shinier. And what happened this summer
Speaker 2: where the arbitration gave right to Venture Global despite the
Speaker 2: fact that they've traded what three hundred cargoes of ellen
Speaker 2: GI's outside their contract the pretender there was still work
Speaker 2: in progust so they could sell at top spot prices
Speaker 2: and not at contract prices. And I think you know
Speaker 2: Shell has lost what four billion and VP about the
Speaker 2: same amount. Traders are very long memory, so I'm pretty
Speaker 2: sure they'll be the first one punished. Now. I want
Speaker 2: to move a bit on the environmental point of view,
Speaker 2: because the narrative, again and again and again has mean
Speaker 2: we're so clean, we're so clean, we're replacing coal and
Speaker 2: gas is so clean. But in fact, some of the
Speaker 2: work you've been doing and other great research has proven
Speaker 2: that there's a lot of CO two embedded in that LENG,
Speaker 2: which of course clashes with the European methane rules. So
Speaker 2: do you want to elaborate a bit on.
Speaker 4: That along with what we talked about at the beginning,
Speaker 4: where they're talking about the golden age of gas. The
Speaker 4: industry has done a great job of selling the world
Speaker 4: on the idea that LNG is a clean fuel, it
Speaker 4: should replace coal, and I mean they go so far
Speaker 4: it's called a climate solution. The science peer reviewed science
Speaker 4: shows that when you take that gas from a US
Speaker 4: field like the Permian and all that transportation and bringing
Speaker 4: it across the ocean, emissions from that are higher than coal.
Speaker 4: But the other aspect of that is in places like
Speaker 4: China and India, gas is not replacing coal because call
Speaker 4: is somewhere it's cheaper. And so the idea that LNG
Speaker 4: is somehow going to rid the world of coal, there
Speaker 4: isn't basis for that either. If you look at it
Speaker 4: from a climate standpoint, LNG of course is a hydrocarbon.
Speaker 4: We're combusting it, it's emitting CO two, But there's also
Speaker 4: the associated methane emissions, especially USLNG, we have very high
Speaker 4: methane emissions. So this is the scientist who led this
Speaker 4: study that showed that with the higher emissions has said
Speaker 4: he thinks this is the worst fossil fuel we could
Speaker 4: be choosing right now, and there's a strong argument to
Speaker 4: be made for that. That's a whole other aspect. I
Speaker 4: don't expect these major governments, and it looks like the
Speaker 4: EU is weakening their stance on their methane regulations, which
Speaker 4: weren't very strong to begin with. They're under extreme pressure
Speaker 4: from the US. But if you look at the science
Speaker 4: and the reality on the ground in the oil and
Speaker 4: gas fields of the US, there is no way US
Speaker 4: gas as LNG can meet the standards that the EU
Speaker 4: is saying they require.
Speaker 5: What we live in world where it's all about energy security,
Speaker 5: and that's why we take that GUS because present we
Speaker 5: don't have any choice.
Speaker 2: Right.
Speaker 4: That's certainly been the justification for this. But one of
Speaker 4: the interesting things I think what's happened in the EU
Speaker 4: is when the Russian invasion first happened, there was this
Speaker 4: huge push by the industry to say, this is why
Speaker 4: you need USL and G, you need energy security, more
Speaker 4: fossil fuels you can count on but Europe has certainly
Speaker 4: moved strongly to renewables.
Speaker 6: And if we think.
Speaker 4: About in the year twenty twenty five, a country that
Speaker 4: does not have their own fossil fuel reserves, if they
Speaker 4: want to think about energy security, it's renewables and it's storage,
Speaker 4: things that you can control and not rely on the
Speaker 4: incredibly volatile pricing of fossil fuels, but also the security
Speaker 4: of your ability to get those, and the political situation
Speaker 4: around the major exporters continues to destabilize. I think I
Speaker 4: would not want to be betting my future on current
Speaker 4: policy from the major exporter.
Speaker 2: There are days in Europe where people think that Katar
Speaker 2: is a more valuable supplier than the US, and they
Speaker 2: are also going into a major expansion themselves. As you said,
Speaker 2: that undamental aspect is being put under the rug because
Speaker 2: the market was short, but I can tell you the
Speaker 2: de market is long. Those undamental criteria is going to
Speaker 2: come back and bite whoever as the because when the
Speaker 2: price is low and you have the choice, you're going
Speaker 2: to choose the Katari gas because it's carbon footprint is
Speaker 2: much lower than in the US. That's going to be
Speaker 2: a double wamy for exporters. AM I the only guy
Speaker 2: thinking about that this way.
Speaker 4: I don't understand why someone with all the other options
Speaker 4: to good invest in fossil fuels right now. But if
Speaker 4: you are, you must be assuming that there will not
Speaker 4: be any sort of carbon pricing or people aren't really
Speaker 4: going to care about carbon emissions or metan emissions down
Speaker 4: the road. And I don't think that's a safe assumption
Speaker 4: for me. It all goes back to the economics. The
Speaker 4: reason I don't see lerg having a future is the economics.
Speaker 4: The Qataris can sell their lerg for a lot les's
Speaker 4: the US. They are in a situation like the Saudis
Speaker 4: being the last man's standing when it comes for the
Speaker 4: Saudis for oil and the Quitars like they've got a
Speaker 4: lot of it and it's cheap, and as you point out,
Speaker 4: it has lower emissions than the US production.
Speaker 1: Justin just maybe as the last question, you're in twenty thirty,
Speaker 1: you're looking back last five years, what's happened.
Speaker 4: One of the things I love about this work right
Speaker 4: now is it changes every day, and it's changing fast.
Speaker 4: I've been following the energy markets now, researching and writing
Speaker 4: around for over ten years. Where we are right now
Speaker 4: shocks me. The rapid rise of renewables, the drop and
Speaker 4: cost of storage. I mean, it's just changed everything. And
Speaker 4: we're also right at an interesting point in history where
Speaker 4: we're looking at least probably a two year over supply
Speaker 4: of oil in the world, which is going to depress prices,
Speaker 4: and a five year over supply for LNG. So the industry,
Speaker 4: if you're an investor in that, you have to be
Speaker 4: looking past that. That's when you're hoping to make your money.
Speaker 4: You're going to come in twenty thirty and like now's
Speaker 4: our time to cash in. What we're going to find
Speaker 4: in twenty thirty is in those five years, China will
Speaker 4: probably have built more than enough renewable energy to power
Speaker 4: an economy like the US In that five year period,
Speaker 4: a lot of other countries we're seeing it around the
Speaker 4: world will have built out a lot of renewable power
Speaker 4: generation and storage because it's cheaper, and the rise of
Speaker 4: evs is happening. China will produce more or sell more
Speaker 4: EV's this year than the US market. So we're going
Speaker 4: to be having demand destruction of both gas and oil
Speaker 4: over that five year period where they're trying to survive
Speaker 4: with we know it's going to be prices too low
Speaker 4: to make money in the US oil business for that
Speaker 4: at least in the next couple of years. So we're
Speaker 4: going to be coming out of this big glut and
Speaker 4: lull for the industry. And if you're an investor in
Speaker 4: that industry, what you have to be betting on is
Speaker 4: that's going to be your time to shine and really
Speaker 4: make back your money or finally cash in. I don't
Speaker 4: see how that happens because the amount of demand destruction
Speaker 4: that will happen in that five year period is going
Speaker 4: to be large. I mean, it's an incredible point in
Speaker 4: the energy trees and the history of energy. Yesterday they
Speaker 4: said they're bringing to Europe. China is going to bring
Speaker 4: their technology where you can charge four hundred and seventy
Speaker 4: kilometers worth of charge in five minutes on an EV.
Speaker 4: Three years ago, all we heard about was range anxiety
Speaker 4: and charging times. And we're not at the end of
Speaker 4: battery development. What are evs? What are batteries going to
Speaker 4: be able to do in five years? So as these
Speaker 4: technologies become cheaper and just consumer friendly and these other
Speaker 4: barriers to acceptance of clean technology go away, and it
Speaker 4: keeps getting cheaper. I would not want to be invested
Speaker 4: in oil and gas in twenty thirty. That's when I
Speaker 4: think we're going to start seeing the stranded assets we
Speaker 4: were talking about.
Speaker 2: Well, Justin, thank you so much for coming on the show.
Speaker 2: What kind of kindred spirit? Because we see it in
Speaker 2: Europe probably within the same time work. Let's hope some
Speaker 2: people come back to reality devasiperate the portfolio and kind
Speaker 2: of change your narrative. Which is a bit difficult because
Speaker 2: they want me to go to say a week and
Speaker 2: I said, no, no, no.
Speaker 4: I got a zero week's story. When I was working
Speaker 4: as a journalist, I applied to get a media pass
Speaker 4: and it took them a day to say, nah, we
Speaker 4: don't think we want to hear the next year, it
Speaker 4: took them fifteen minutes.
Speaker 1: It's progress.
Speaker 2: Justin, cheers, thank you very much, justin, all right, thank you.
Speaker 6: Well.
Speaker 2: Job a conversation we've just seen clearly demonstrate that there
Speaker 2: is a huge problem and those guys seems to be
Speaker 2: oblivious about what's coming on.
Speaker 1: Yeah, well listen my takeaway and it is that they
Speaker 1: actually just don't understand global geopolitics, right, global geopologism. I
Speaker 1: may say, there's two things is that there's an imperative
Speaker 1: in Europe and China to electrify and move away from gas, okay,
Speaker 1: and we're seeing that run full speed ahead. And the
Speaker 1: second thing is, well, we've got a whole part of
Speaker 1: Russian gas that can't go anywhere, and I can only
Speaker 1: put a bet on it. At some point there will
Speaker 1: be an agreement with the Ukraine, and that Ukrainian agreement
Speaker 1: will involve Russian gas flowing into Europe again. So they're
Speaker 1: huge risks around. So I really don't understand the long
Speaker 1: term investment strategy of some of these big funds in
Speaker 1: the States. I really don't. Now, I mean, call me crazy,
Speaker 1: right And by the way, that's what I conclude listening
Speaker 1: to Justin is that this is a recipe for disaster.
Speaker 2: And it's not just the ALLENGI terminals. If you look
Speaker 2: at Venture's Global, which is one of the main players
Speaker 2: in that sector there. I peered at the beginning of
Speaker 2: tour twenty five at twenty four dollars per share and
Speaker 2: now it's down to fifteen, So it means there are
Speaker 2: some people who don't buy the story. The second point
Speaker 2: is the Allergy fleet. The Allergy fleet beginning of the decade,
Speaker 2: five hundred ships, we're going to one thousand ships. There's
Speaker 2: going to be a lot of ships. And more generally speaking,
Speaker 2: there is flaring. The amount of flaring, it's a disgraceful
Speaker 2: this industry. The amount of flaring is one hundred and
Speaker 2: fifty billion qubic matter of gas, which means nothing to anybody,
Speaker 2: just that you know, that was what Europe used to
Speaker 2: import from Russia. If we just capture that. And I
Speaker 2: know it's a bit easy, and it's we have places,
Speaker 2: but there's so much gas wasted. Ellen g is very expensive.
Speaker 2: It should be cheap. But as you say, yeah, the
Speaker 2: pipeline might make that come.
Speaker 1: Back, while the pipeline is the cheapest way to send gas.
Speaker 1: I mean, that's the reality of her. And I think
Speaker 1: the point you're also saying as well is you wouldn't
Speaker 1: flare a huge amount of gas if you didn't have
Speaker 1: a lot of it. And the point is there is
Speaker 1: a lot of gas out there. And I think the
Speaker 1: conclusion I take out of this is don't keet me wrong.
Speaker 1: I'm sure there's anyone who's buying L and J. It's
Speaker 1: expensive to buy. The advice you'd give to them as
Speaker 1: don't sign any long term contracts.
Speaker 2: Well, Garden. As we conclude this episode, first the clip
Speaker 2: because the young listeners don't know about that movie that much,
Speaker 2: but I want them to hear that clip. It's from
Speaker 2: Uppercalypse now, a movie from the late seventies, and it's
Speaker 2: about the smell of gasoline.
Speaker 1: I love the smell of.
Speaker 2: Play pame in the morning.
Speaker 1: You know that gasoline smell smelled like Victory, Lauren. Great
Speaker 1: way to end, absolutely, great way.
Speaker 2: No, but I want to end it on something special
Speaker 2: and personal. You were not there two weeks ago on
Speaker 2: the show for a great reason is that you got
Speaker 2: married for the second time and it was in Tuscany
Speaker 2: and it was beautiful, very emotional. Your your wife was
Speaker 2: you were great. And we had that speech by Shane
Speaker 2: and I'm still crying about it, and at some point
Speaker 2: it us all about friendship togetherness and really brought me joyce. Okay,
Speaker 2: now I'm sharing it with our listeners. And the best
Speaker 2: moment is when it started a cappella in the church singing,
Speaker 2: why mall say.
Speaker 1: You can't I can't sing moron, I reckon.
Speaker 2: I'm not saying.
Speaker 6: Only fools, only fools vershion, but I can help falling
Speaker 6: in love with you. Okay, job, talk to you next week.
Speaker 2: My friend.
Speaker 1: It was an amazing moment. It really was. I'll never
Speaker 1: forget it. Thank you for listening to Redefining Energy. Don't
Speaker 1: forget to read the show and subscribe on Apple Podcast, Spotify,
Speaker 1: or the platform of your choice.