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To help clients control a critical and potentially volatile
component of the energy equation, ICF International assesses
and forecasts natural gas, petroleum, and coal markets
worldwide using deep industry expertise and proprietary
models and databases. Our analyses and valuations have
supported the financing of more than US$10 billion in gas
assets.
ICF’s gas area expertise was augmented in January 2007 with the acquisition of Energy and Environmental Analysis (EEA), a national leader in gas market analysis.
Natural Gas Market Analysis
National Petroleum Council Studies of the North American Gas Market. ICF (formerly EEA) was the lead modeling contractor for the 1992, 1999, and 2003 National Petroleum Council natural gas studies. These studies were conducted to evaluate the potential for North American natural gas to meet anticipated demand. To perform the studies, ICF used its proprietary Gas Market Model (GMM™). The approach to the studies was to develop a reference case projection and a series of sensitivity cases to evaluate input assumptions. Sensitivities were developed for changes in resource base, oil prices, technology, gross domestic product (GDP) growth, and resource access. Each sensitivity was evaluated for its impact on gas price, supply, and demand.
Canadian Grand Banks Gas Transport and Marketing Study. ICF is investigating transportation options for natural gas that could be produced from the Canadian Grand Banks. This study involves market characterization of eastern Canada and the northeastern United States and seeks to identify and assess the expected prices, basis differentials, size, liquidity, and depth of market centers near four candidate terminus points for Grand Banks natural gas; identify options and estimate the transportation costs from the terminus points to those market centers and related storage locations; and summarize and qualitatively rank the characteristics of each terminus point and the market centers that can be served from each terminus point.
Natural Gas Price Volatility. ICF (formerly EEA) completed a study of natural gas price volatility for the American Gas Foundation. This study examines the causes of natural gas price volatility and evaluates future volatility trends. The study also evaluates the impact of volatility on market participants and proposes a number of strategies for reducing future volatility.
Market Liquidity Studies. ICF (formerly EEA) conducted a review of the liquidity and price behavior for the New York Gas Association (now Northeast Gas Association) to look at liquidity and pricing at 13 pricing locations where local distribution companies and marketers buy and sell gas in the Northeast. The report provided the first quantitative methodology to measure gas market liquidity and has been used in regulatory proceedings in the United States and Canada.
Natural
Gas Reliability and Capacity Analysis. ICF International performed
a reliability and capacity study for a Midwest gas utility’s
facilities for supplying natural gas during peak demand periods.
The gas supply facilities included a substitute natural gas
(SNG) plant, a liquefied natural gas (LNG) storage tank and
vaporizer, an underground gas storage field, and a propane/air
injection unit. We determined the probabilities of different
combinations of facility outages and associated gas delivery
capacities using the estimated reliability and effective
capacity levels for the individual gas supplies. Our analysis
enabled the client to assess the adequacy of reserve margin
in support of their presentations to the state public utility
commission.
Estimation of Heavy Oil Recovery Potential
and Associated Gas Demand. ICF International performed
a series of studies assessing the technical and economic
potential of future California thermal enhanced oil recovery
(TEOR), and the natural gas requirements of TEOR facilities
in California for the Southern California Gas Company (SoCal
Gas). ICF International collected production and fuel requirements
from TEOR operations and cogeneration facilities installed
in California's heavy oil fields and assessed future TEOR
market potential. We assisted SoCal Gas in identifying
future market opportunities for gas sales within this sector.
We also performed a variety of assessments examining the
relative ability of SoCal Gas to compete with pipeline
companies and producers to serve the market for natural
gas in TEOR facilities. In addition, ICF International forecasted
the impact of the availability of TEOR bypass on the price
and availability of California supplies to local distribution
companies (LDC) by estimating the volumes of California-source
gas displaced from TEOR markets to the LDCs and the effect
of additional pipeline capacity on price differentials
between California-source and interstate gas.
Evaluation of LNG Market in South Korea. ICF International was asked to perform an economic and financial
feasibility study of an existing gas-fired generation power
station in South Korea by a major private sector gas and
power company. The analysis looked at the effects of changes
in relative price of LNG, nuclear buildup, the effects of
new Combined Cycle Gast Turbine (CCGT) technology and demand
for power to determine the future prospects of the existing
station and potential expansions at the same site. ICF International's Integrated
Planning Model (IPM®) was
used to estimate revenues and dispatch forecasts for all
the major power producing facilities in the country. We also
established the effect on the overall size of the LNG market.
Supply Assessments
and Project Evaluation
North American Continent Gas Supply and Gas Transport Study for Nevada. ICF used its proprietary Gas Market Model (GMM™) to analyze and describe the current transport and supply conditions in the North American natural gas market. ICF is providing projections that assess the reliability of gas supply and transport for Nevada consumers. A number of alternative scenarios that assess natural gas transport and storage under a range of market conditions were considered during the study.
Gas Supply Assessment. For a nonprofit foundation, ICF assessed future gas sources, including the potential for new drilling and completion methods such as horizontal and multilateral pinnate drilling to increase domestic natural gas supplies. The study also includes an analysis of the economics of making synthetic natural gas from underground gasification of minable and unminable coals.
Operating Costs for Existing Wells and Reserves. ICF developed an operating cost model of existing onshore and offshore oil and gas wells. The model characterizes all existing wells by depth and production volume and is used to develop operating cost curves by type of property and region (primary oil, secondary oil, enhanced oil recovery, conventional gas, coalbed methane, gas shales).
Study of Major Issues Potentially Affecting
North American Natural Gas Supply. ICF International
evaluated the impact of various scenarios on the natural
gas marketplace for a group of Canadian and U.S. producers
and transporters. The scenarios included electric power deregulation
and industry restructuring, increased pipeline capacity from
Canada to the United States, development of Canada's Sable
Island gas resources, development of Mexico's northern gas
basins, and alternative environmental regulatory regimes.
The analysis provided impacts in terms of natural gas supply,
demand, and price.
High Deliverability Gas Storage in
U.S. Northeast. ICF International
analyzed the commercial feasibility of a salt cavern natural
gas storage project in the Northeastern United States for
a gas storage developer and service company. We performed
economic analysis of the regional market for high deliverability
storage service and the alternative services available to
prospective customers. Pipeline capacity, conventional seasonal
storage, and LNG options were considered as potential alternatives.
Potential competing markets included regional power generation,
industrial, and core market sectors. Potential storage service
customers researched were LDCs and gas marketers as well
as direct service for power generators and industrials.
Assessment of Combined Cycle Facility. ICF International prepared an assessment of the gas supply and transportation
contract arrangements for a new combined-cycle facility.
We reviewed the delivered gas price to the facility relative
to prices to its competitors serving the same market area.
In addition, we projected the delivered gas price for the
project financing and analyzed the adequacy of the facility's
fuel supply contract arrangements. The delivered gas prices
then were used in wholesale power market models to determine
market dispatch and forward price curves.
Natural Gas Storage and Pipeline Valuation. ICF International assessed the value of a proposed storage project
and related natural gas pipeline in the Southwest United
States for a private power company interested in bidding
on capacity. Using ICF International's Energy
Asset Decision Support System (EADSS™),
we identified how the proposed storage and additional pipeline
would alter the flow patterns, enhance deliverability, and
reduce price volatility. This engagement required modeling
gas and electric market interactions.
Asset Optimization and Valuation
Asset Optimization for Gas Distribution
Companies. ICF International evaluated several gas distribution company LNG
projects in the context of performing gas supply studies.
We developed computer models to optimize the gas supply options—including
gas supply contracts, pipeline contracts, storage, peak
shaving facilities, and LNG facilities. In one case we
worked with an engineering firm to identify least cost
options for upgrading a 30-year old LNG plant.
Pipeline Valuation. ICF International supported
valuations of the Texas Oasis pipeline and the Weeks Island
Pipeline. For the former, we examined producer options for
shipping on alternative pipelines to help identify what rates
could be charged based on shipper opportunity costs and market
prices in the Katy and Waha areas. For the Strategic Petroleum
Reserve, we helped the government develop information to
submit an offering memorandum for selling the surplus Weeks
Island oil line as a gas pipeline. We identified markets,
differential values in these markets, potential buyers, and
an estimate of the value.
Evaluating Natural Gas Gathering Facilities. On
behalf of an interstate pipeline, ICF International estimated
the value of a nonjurisdictional gathering pipeline system.
The analysis used the EADSS™ to examine the implications
of possible new production coming on line, gas market prices
on different connecting pipelines, and competition from nearby
gathering systems. The analysis showed the expected stream
of revenues and the high and low values associated with project
uncertainties.
Pacific Northwest Gas Storage Strategy
Study. ICF International
used EADSS™ to evaluate strategies for purchasing or
releasing transportation capacity and purchasing gas storage
capacity. The work was performed for the owner of a gas-fired
generator and thus looked at alternative dispatch scenarios,
price volatility in the gas and oil markets, and pipeline
interruption, as well as oil prices.
Alaskan Pipeline. For producers on the
Alaskan North Slope, ICF International evaluated the effect
of Alaskan and MacKenzie Delta gas on U.S. and Canadian gas
markets, prices, and pipeline flows. We evaluated various scenarios to assist the producers in
understanding the implications of different assumptions and
configurations for bringing frontiers supplies into the market.
Coal Supply and Emissions Analyses
Underground Coal Gasification. ICF prepared estimates of the volume of U.S. coal that would likely be targeted by underground coal gasification (UCG) and estimated UCG economics under various geologic conditions of coal type, depth, and seam thickness and various process designs. The economic model was based on ICF’s database of petroleum industry drilling and operating cost factors and a consistent set of algorithms for gas processing equipment capital and operating costs.
Coal Market Analysis
and Forecasts. ICF International provided coal supply
chain analyses of a coal-fired plant in bankruptcy proceedings
for a major southwestern utility. We performed coal market
analysis and estimated fair market prices for coal and
transportation. ICF International also analyzed coal supply
and transportation contracts, and evaluated alternatives,
including contract buyout, alternative supply, and alternative
transportation methods. We assessed available capacity
of coal producers, railcars, barges, and towboat, as well
as capital investment requirements for incremental capacity
additions. Our analysis including interviewing coal producers,
rail carriers, barge companies, coal transfer terminal
operators, equipment manufacturers, trade associations,
and government agencies.
Coal Mine Asset Valuation. ICF International
analyzed the potential acquisition of mine assets for a
client in the Southwest United States. Our analysis involved
estimating sales, production costs, tax depreciation, tax
implications, financing structures, net present value, internal
rate of return (IRR), and debt coverage ratios. We also valuated
the advantage and disadvantage of such an acquisition.
LNG Environmental Impact Assessments. ICF International evaluated several LNG project alternatives for
the Chevron-Texaco West African Pipeline Project while conducting
five separate environmental
impact assessments for this multinational
natural gas development project. The project may expand
to include LNG infrastructure.
Oil and Gas Environmental Issues for
American Petroleum Institute (API). ICF International provides continual technical
support to API on oil and gas environmental issues. As an
example of one project, we provided facilitation and technical
input into guidelines for owners and operators of oil and
gas waste disposal facilities. In addition, we developed
a sophisticated statistical model for estimating the potential
human health effects of various waste
management practices and recommended specific risk-based waste management procedures.
Coal Supply Analysis for Transportation
Fuels. ICF International rovided
fuel supply chain analysis for a utility in a bankruptcy
case. We evaluated coal supply and transportation alternatives
and estimated potential economic damages if coal supply and
transportation contracts were voided. We also analyzed competitive
rates for rail and barge shipments of coal and rail and barge
costs, including capital costs and variable costs. ICF International
directed and managed the National Coal Association's (NCA)
annual survey on coal transportation from mines to utilities
and NCA's in-house database on coal and utilities, and
participated in the NCA annual surveys on coal mine expansion
plans and on utility capacity addition plans.
Environmental Impact Study of Deep
Water Ports. ICF International
staff analyzed the onshore industrial economic and environmental
impacts of constructing and operating a deep water port in
five locations: Machias (Maine), Sandy Hook (New Jersey),
Delaware Bay (Southern New Jersey), the Mississippi Delta
(La Fourche, Louisiana), and Freeport (Texas) on behalf of
the Council on Environmental Quality.
Mining Economic Impact Analysis. ICF International
participated in the economic impact analysis of proposed
mining regulations for the Office of Surface Mining, U.S.
Department of the Interior. We assessed the potential market
for longwall coal mining operations and evaluated the production
costs for various mining methods.
Strategic Implications for Suppliers
of Coal to the European Power Generation Sector. ICF International provided input to a
strategic review being undertaken
by one of the world's
largest suppliers of coal to the mining sector. ICF International's
input was based on insights from analyzing the impact from
greenhouse gas (GHG) emissions trading on the European
power generation sector and the likely implications for
coal-fired power plants in Europe.
Strategic Implications for French Operations of
Global Oil and Gas Company. ICF International
assisted in a strategic review by one of the world's
largest oil, gas, and power generation companies interested
in understanding the potential impacts on its fuels business
from the proposed European Union greenhouse gas emissions
scheme.
Coal Market Analysis in India. ICF International
performed
a feasibility study using domestic and imported coal for
a power project in southeastern India. This study entailed
an on-site evaluation of the mine site for the proposed domestic
coal option andan analysis of the Indian rail system and
the port infrastructure that would be used for this coal
option. In addition, ICF International performed a price forecast
of imported coal, and compared the contractual security of
domestic and imported coal options. ICF International developed
detailed financial models to support its conclusions.
Fuel Due Diligence and Financing Support
Gas Project Asset Valuation for Financing
Support. ICF International provided gas market expertise to lenders to justify
financing for over US$4 billion in independent power projects.
Our studies required analyses of specific gas contracts and
pipeline transportation agreements and review of regulatory
documents. Our reports formed the basis for lenders’ support
of these projects.
Market Assessment for Pipeline Refinancing
for Major Interstate Pipeline Company. ICF International
conducted a market assessment for the refinancing of the
Iroquois pipeline to benefit its potential lenders and
noteholders. ICF International assessed gas supply, demand,
and transportation in the Northeast United States. We also
examined the gas production outlook and the value of supply
from relevant sources, determined the range of gas market
outlooks for the Northeast United States, and assessed
the competitive position of the pipeline in its northeastern
market.
Fuel Contracting Adequacy Due Diligence. For an international
power developer, ICF International completed domestic due diligence
of its fuel supply contracts and expected pricing of a proposed
project's financing. We analyzed the adequacy of fuel supply
and transportation arrangements given each facility's contractual
arrangements and geographic location. We assured that authorizations
to receive gas supply at the power plant were obtained by
the projects, its suppliers, and transporters. ICF International
also provided forecasts of gas supply costs and the plant
gate and applied regional gas price forecasts for use in
our forward price modeling of electricity prices (through
2025).
Oil-Fired Power Plant Due Diligence. On behalf of Lehman
Brothers, ICF International examined the market for a 130 Mw
power project developed by Enron on Hainin Island in Southern
China. ICF International reviewed whether it was an economically
sound decision to build the facility given the projected
electricity demand of Hainin Island, its existing generating
resources, and the alternative options available to meet
projected needs. Lehman Brothers used our report in the public
debt offering for this power project.
Market Assessment for Financing of
New Pipeline Construction for Bank Consortium. ICF International was retained by a consortium
of banks to provide a market assessment for financing the
construction of the $1 billion Maritimes and Northeast Pipeline
System (M&N) between Nova Scotia and the U.S. Northeast.
We analyzed the long-term potential, viability, and economics
of gas supply from the Western Canadian Sedimentary Basin
(WCSB), reviewed long-term gas demand forecasts, and assessed
relative competitive positions of fuel suppliers and pipelines
delivering into the New York and the U.S. Northeast markets.
We also reviewed the relative economics of supplies from
other basins that could compete to serve the U.S. Northeast
markets targeted for the M&N project.
Coal Supply Assessment for First 144A
Merchant Coal Power Plant Financing. ICF International
provided the analytical underpinning for a first-of-its-kind
financing transaction for a merchant coal-fired power plant
financed by a 144A bond offering. We forecasted market
prices, characterized market uncertainties, analyzed market
risks, and analyzed wholesale power revenues and fuel costs.
In addition, ICF International assisted in the marketing efforts
for the bond offering, and in obtaining investment-grade
ratings from Moody's, Standard & Poor's (S&P), and Fitch.
Oil and Gas Regulatory Support and Government Services
Resource
and Technology Assessments Relative to Oil and Gas Exploration
and Production Strategies. ICF International developed
a reservoir-by-reservoir simulation used since 1993 by
the Ecuador Ministry of Energy and Mines to implement a
Master Plan for the development of the country's petroleum
sector. The model accounts for various scenarios for world
crude prices, secondary and tertiary production options,
contract terms, and investment constraints.
Assessment of Alternative Gas Export
Projects. ICF International evaluated the market impacts associated with various potential
projects intending to transport natural gas from Alberta
and British Columbia, Canada, to the Midwest United States
for several oil and gas production and pipeline companies.
These assessments examined the impact over time of these
proposed pipeline projects on wellhead prices, city gate
prices, and gas drilling and production levels. The studies
were used to provide the basis for major investment decisions
and to support filings before several regulatory agencies.
Gas Well Characterization and Evaluation
Program. ICF International
developed a system to review and characterize inactive and
marginal oil and gas wells in New York to evaluate the potential
risk of the wells becoming financial or environmental liabilities
to the state or local communities. The study recommended
regulatory and technology initiatives to both manage the
high-risk well population and prevent the premature abandonment
of the state’s drilled well resource.
State and Regional Petroleum Infrastructure
and Distribution System. ICF International analyzed the petroleum infrastructure
and distribution system in New England for the Massachusetts
Division of Energy Resources to establish a baseline for
evaluating potential future energy and emergency
planning policies. We analyzed trends in petroleum supply and demand,
characterized terminal storage facilities and delivery systems,
identified potential vulnerabilities, and suggested possible
remedies.
Natural Gas STAR Program Support. ICF International provides
technical support and implements the U.S. EPA’s voluntary
methane emissions
reduction program for the natural gas
industry, Natural Gas STAR. ICF International identifies methane
emissions reduction best management practices and conducts
technology transfer and outreach to all sectors of the
gas industry.
Technical Support to the Strategic
Petroleum Reserve (SPR). ICF International conducts analyses of world petroleum markets
and the North American crude oil distribution system using
the EnSys WORLD™ model and other SPR models. ICF International
also assists the SPR in evaluation of the potential impacts
of alternative SPR drawdown and crude oil distribution scenarios
on prices, refining, U.S. imports, and the U.S. economy.
Technology Transfer Strategic Planning
Support for Independent Petroleum Association of America. ICF International provided extensive strategic advice and technical
assistance to the Independent Petroleum Association of
America (IPAA) in developing the Petroleum Technology Transfer
Council (PTTC), a coordinated national technology transfer
organization to serve oil and gas producers and the research
and development (R&D) community. ICF International also helped
devise the PTTC concept by analyzing industry technology
transfer needs and pathways for the U.S. Department of
Energy, preparing testimony for the U.S. Congress, and
constructing a detailed costing and budget model for the
PTTC project. We also provided strategic and organizational
advice to the PTTC's Board of Directors and Executive Director.
Off-Highway Distillate Infrastructure
and Distribution System. ICF International analyzed the U.S. distribution system and
consumption patterns for various grades of off-highway distillate
fuel oil. We characterized the number, capacity, and types
of oil storage tanks in off-highway distillate service for
various industry sectors and evaluated the capability of
the land-based and marine infrastructures to accommodate
additional product grades.
Support to the U.S. Environmental Protection
Agency for New Source Review (NSR). ICF International
provides ongoing support to the U.S. EPA’s Clean
Air Act Advisory Committee. We implemented the U.S. EPA’s
public outreach for New Source Review (NSR) by facilitating
public hearings across the country, publishing all oral
and written comments, and authoring a survey paper of available
literature and public statements on NSR issues.
Support to Blue Ribbon Panel on Oxygenates
in Gasoline for U.S. Environmental Protection Agency. The
Methyl Tertiary Butyl Ether (MTBE) Blue Ribbon Panel was
created by a charter from the Clean Air Act Advisory Committee
(CAAAC) to provide independent advice and counsel to EPA
on policy issues associated with the use of MTBE and other
oxygenates in gasoline. ICF International provided technical
and administrative support to the Blue Ribbon Panel process
and played an integral role in the production of specific
chapters in the Blue Ribbon Panel's report, "Achieving
Clean Air and Clean Waters." Topics of these chapters
included water contamination, air quality benefits, prevention,
treatment and remediation, fuel supply and cost, and fuel
additives.
Environmental Impact Statement for
Divestiture for U.S. Department of Energy (DOE). ICF International provided strategic planning and privatization
services for DOE in support of its US$3.65 billion sale
of Naval Petroleum Reserve Number One at Elk Hills, California,
to Occidental Petroleum. ICF International prepared an environmental
impact statement (EIS) for the divestiture. The EIS withstood
a court challenge that could have delayed the sale.
Environmental Support for U.S. Department of Energy
Office of Postsecondary Education (OPE). ICF International
is managing a multi-year contract to analyze the economic,
energy supply, and environmental impacts of regulatory
and technology changes. This work provides the analytical
basis for DOE decisions regarding federal investments that
will stimulate domestic oil and gas exploration, production,
and downstream activity while protecting the environment.
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