Cashing in on LNG (Large Neglected Gains)

A lucrative logistical choke point

If it doesn’t work, keep at it?

By the force of circumstances, this newsletter ends up talking A LOT more than planned about the energy crisis and Europe's mismanagement of its energy policy.

European leadership is going from blunder to blunder at such a remarkable pace that I struggle to keep up writing about it. Living here, it is a little scary and depressing too I must admit. Here is a short list:

• Obsessing about unreliable renewable energy sources, forcing them upon the grid at all costs, and spending massive capital to increase renewables production.

• Needing a lot more natural gas as feedstock for speaker plants, able to quickly compensate for renewable unstable and unpredictable supply.

• Banning new drilling and funding to its domestic fossil fuel industry.

• Buying the same amount or more of fossil fuels from potentially hostile countries (Arab states, Russia).

• Creating a regulatory burden so absurd that a new nuclear power plant can almost never be built

• Closing early existing nuclear power plants with decades of operation left in them.

• Refusing to sign long-term gas supply agreements, as this would “hinder commitment to the energy transition”. Then get shocked when spot prices are very unstable and expensive.

• Simultaneously sanctioning Russia (including taking/freezing/stealing $300B from them), de facto going at war with it and getting surprised they “use gas supplies as a weapon”.

I still believe the cause is sheer stupidity for most of the political class. But in the case of some Green parties, I am starting to think this is more intentional than just sheer stupidity (either corruption by Russia or a de-industrialization agenda).

And now we are heading for one more massive blunder, obvious to anyone understanding how the physical (and not financial or political) world functions. Something so needed that if insufficient, it will quite literally turn the whole continent dark.

Luckily for me and my readers, there is also a way to make money from it, as the companies able to provide this will be able to ask for any price.

I am speaking of LNG carrying capacity, as well as gas liquefaction and re-gasification.

Some companies are still undervalued, but probably not for long.

So let’s look into it.