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Souki still didn’t when I met him in early February at Tellurian’s office in downtown Houston. The company has a small space in a building owned by the oil supermajor TotalEnergies, and from the upper-story conference room, Souki and I could look out and see the distant expanse of the Texas City oil complex, a warren of storage tanks and refineries spewing bright orange flames. Despite all the hurdles Tellurian was facing, Souki had an unflappable air about him and spoke with the kind of blasé confidence one might expect from a man accustomed to raising billions of dollars for long-shot projects. He was wearing one of his trademark double-breasted suits, along with a pink tie, and as he talked he sometimes removed a retractable ballpoint pen from his jacket and fidgeted with its clicker.
I wondered why Souki was so determined to get back into the L.N.G. business. After all, he had already made a fortune, and the industry he started was reaching maturity. Tellurian was still several years and billions of dollars away from being able to profit off it again. Why didn’t he just stay home in Aspen?
How the Supply Chain Crisis Unfolded
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The pandemic sparked the problem. The highly intricate and interconnected global supply chain is in upheaval. Much of the crisis can be traced to the outbreak of Covid-19, which triggered an economic slowdown, mass layoffs and a halt to production. Here’s what happened next:
A reduction in shipping. With fewer goods being made and fewer people with paychecks to spend at the start of the pandemic, manufacturers and shipping companies assumed that demand would drop sharply. But that proved to be a mistake, as demand for some items would surge.
Demand for protective gear spiked. In early 2020, the entire planet suddenly needed surgical masks and gowns. Most of these goods were made in China. As Chinese factories ramped up production, cargo vessels began delivering gear around the globe.
Then, a shipping container shortage. Shipping containers piled up in many parts of the world after they were emptied. The result was a shortage of containers in the one country that needed them the most: China, where factories would begin pumping out goods in record volumes.
Demand for durable goods increased. The pandemic shifted Americans’ spending from eating out and attending events to office furniture, electronics and kitchen appliances – mostly purchased online. The spending was also encouraged by government stimulus programs.
Strained supply chains. Factory goods swiftly overwhelmed U.S. ports. Swelling orders further outstripped the availability of shipping containers, and the cost of shipping a container from Shanghai to Los Angeles skyrocketed tenfold.
“The world is screaming for natural gas,” he said, “and I would like to be able to deliver natural gas as soon as possible.” There was already an energy shortage in Europe over the winter, a result of a fast pandemic rebound, and people in Britain were worried about paying their gas bills — how could he not want to supply them with more fuel? Moreover, he said, “the emerging countries are going to add two billion people, and their standards of living are improving all the time. They’re not going to say, ‘I don’t want to live like you.’”
As Souki sees it, the need to provide the world with energy in the short term outweighs the long-term demand of acting on carbon emissions. The world may be facing energy and climate crises, he said, “but one is going to happen this month, and the other one is going to happen in 40 years.” He added: “If you tell somebody, ‘You are going to run out of electricity this month,’ and then you talk to the same person about what’s going to happen in 40 years, they will tell you, ‘What do I care about 40 years from now?’”
Two weeks later, Russia invaded Ukraine. The booming American L.N.G. industry rushed in to fill the gap left by Russian gas, turning its focus from Asia to Europe. Cargoes that had already left American export facilities bound for Japan or China changed course and headed to France and the Netherlands, fetching multiple times the price they would have just days earlier. A few weeks after the invasion began, the United States and the European Commission announced a long-term agreement to help Europe free itself from Russian gas, with American producers promising to supply at least one-third of what Russia had once provided the continent. Bulgaria, Germany and Greece all raced to build new import terminals so they could accept American gas before winter, as Russia cut off gas deliveries to one country after another; eventually, Germany was moving to flip on old coal plants. Just a few months earlier, at the United Nations Climate Change Conference in Glasgow, these same European governments had affirmed their intention to give up fossil fuels, but now they had to shelve those ambitions.
I met Souki again in April in New York, at the downtown offices of a media-strategy company. Souki was taking advantage of the chaos in energy markets to again make his moral case for sending fracked gas all over the globe: He was stopping in New York to talk to potential investors and develop a new media strategy for Tellurian before he went down to Washington to meet with policymakers and legislators. We huddled together at a conference table in the lobby.
