New base 03 march 2021 energy news issue 1412 by khaled al awadi

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NewBase Energy News 03 March 2021 - Issue No. 1412 Senior Editor Eng. Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
UAE is launching a new energy model to map out the country's
energy transition over the next 50 years.
The Natinal + NewBase
The UAE is launching a new energy model to map out the country's energy transition over the next
50 years. The energy and infrastructure ministry, Abu Dhabi-based International Renewable Energy
Agency and Khalifa University launched the National Integrated Energy Model on Tuesday to drive
more sustainability into the sector.
The new model will support the UAE's existing National Energy Strategy, which looks to add 50 per
cent of clean energy into the country's power mix by 2050. The strategy also aims to raise the
efficiency of individual and institutional consumption by 40 per cent during that period.
"Clean energy is an essential part of the future energy mix, which the UAE takes into account when
formulating national strategies and legislations," said Sherif Al Olama, undersecretary of the ministry
of energy and infrastructure for energy and petroleum affairs.
Clean energy sources, including hydrogen, are emerging as alternatives to traditional energy
sectors, he added. The UAE, Opec's third-largest producer, is taking various steps to diversify its
energy mix, including the formation of a hydrogen alliance earlier this year to step up its investment
into the clean fuel.

Abu Dhabi National Oil Company, Mubadala as well as holding company ADQ, are all part of an
ecosystem that aims to produce and export green and grey hydrogen.Energy systems based on
renewable energy sources are at the core of any national commitment under the Paris Agreement
on Climate Change, said Irena director general Francesco La Camera.
The Paris Agreement, which the UAE has ratified, looks to lower global warming to well below 2°C
above pre-industrial levels, preferably about 1.5°C.
During the past decade, there have been drastic changes in the renewable energy industry across
the world and in the UAE.
To address the impact of climate change on the environment and well-being of people, the UAE
government launched the ‘UAE Energy Strategy 2050’ in early 2017 as an effort to diversify the
country’s current energy sources. The initiative is in line with the UAE’s broader strategy for
economic diversification and technological advancement.
The UAE Energy Strategy 2050 aims to change traditional energy usage by shaping the demand
and supply of alternative resources. In simple words, this project is in line with the UAE’s
commitment to adopting cleaner energy resources in an attempt to reduce the dependence on crude
oil and decrease the carbon footprint of the country.
UAE ENERGY STRATEGY 2050
In 2016, as part of an agenda of the United Nations, countries across the globe signed an agreement
to introduce measures to reduce greenhouse-gas-emission and adopt alternative energy resources.
The UAE Energy Strategy 2050 is in line with this global vision. The aim is to reduce carbon
emissions by increasing the use of sustainable, green energy in the UAE. Sustainable projects like
Masdar City in Abu Dhabi and the Mohammed bin Rashid Solar Park in Dubai have already directed
international attention to the UAE’s efforts to embrace alternative energy sources.
UAE ENERGY STRATEGY 2050: THE PRIMARY OBJECTIVES
The UAE Energy Strategy 2050 has clear objectives. The program will:
 Increase the contribution of clean energy in the total energy usage from 25% to 50% by the
year 2050.
 Reduce the carbon footprint (of power generation) by 70% and save AED 700 billion.
 Increase consumption efficiency of all users (individuals and companies) by 40%.

INVESTMENT FOR ENERGY STRATEGY 2050
To achieve these goals, the UAE government plans to invest AED 600 billion towards the project
by 2050. The focus is to meet the increasing demand and at the same time ensure economic growth.
Dependency on fossil fuel and oil is being steadily reduced to manage the impact of climate change.
UAE ENERGY STRATEGY 2050 PHASES
Three phases of UAE Energy Strategy 2050 have been introduced by the government.
The first phase, which is already being implemented, is about accelerating efficient consumption of
energy and diversification.
The second phase will be about making efforts to find unique solutions to integrate energy and
provide transportation solutions.
The final phase will focus on extensive R&D to identify and create ways to supply sustainable energy
in the long run.
PILLARS OF UAE ENERGY STRATEGY 2050
The UAE Energy Strategy 2050 has five different pillars. It is closely related to other federal and
local strategies including the UAE Vision 2021, the UAE Centennial 2071 and the Dubai Plan 2021.
Infrastructure
The Dubai Solar Park (Mohammed Bin Rashid Al Maktoum Solar Park) is one of the largest
infrastructure initiatives of this energy strategy. It is also the largest generator of alternative energy
from a single location. This Solar Park has the capacity to generate 5,000 MW in the next ten years
with a total investment of AED 50 billion. This amounts to 25% of the total energy requirement in
Dubai.
The Dubai Electricity and Water Authority (DEWA) has revealed that numerous other clean energy
projects are underway. Etihad Energy Services Company (Etihad ESCO), a company owned by
DEWA, aims to retrofit more than 30,000 buildings in the emirate of Dubai by 2030 by upgrading
their air-conditioning and lighting systems and making them energy efficient. It is estimated that this
project will cost AED 30 billion but in the long term it is expected to save AED 52 billion.
Another major on-going infrastructure initiative is the Sharjah ‘Waste to Energy Project’ by Masdar
and Bee’ah. This project will change the landscape of energy generation in the emirate. It will have
the capacity to divert more than 300,000 tons of solid waste from landfills every year.
The facility will process around 37.5 tons of waste per hour to generate electricity. By next year, the
aim is to divert 75% of the solid waste from UAE landfills to power this alternative energy source.
Another infrastructure development is the “Dubai Green Zone.” This zone will help attract investment
for R&D in the field of clean energy.
Legislation
The initial focus of the UAE’s Energy Strategy 2050 was to develop a legislative structure to support
the country’s green energy policies. The Shams Dubai initiative has allowed Dubai homeowners
to install solar panels on their roofs. This was accomplished with the support of Dubai Electricity
and Water Authority (DEWA). Another aspect of it was improving building capacity at the municipal
level. The larger goal of consumption rationalization and energy production can also be achieved
by installing solar panels on all buildings in Dubai by 2030.
Dubai Green Fund

The Dubai Green Fund was established to accelerate the implementation of the Energy Strategy
UAE 2050. The fund, worth AED 100 B, has been used to provide simple loans to investors at
reduced interest rates. This loan can only be used to invest in the clean energy sector.
Building Capacities and Skills
Another critical component of implementing the Energy Strategy UAE 2050 is the development of
human resources. Global coaching programs in coordination with international institutes like IRENA
(International Renewable Energy Agency) have been introduced in this regard.
UAE ENERGY MIX 2050
The planned UAE Energy Mix 2050 will look like this:
 44% clean energy
 6% nuclear
 38% gas
 12% clean coal
 The end goal is to make Dubai a city with the least carbon footprint in the world.
MILESTONES ACHIEVED
Since the plan has been in motion for the past three years, certain targets have already been
achieved.
 Carbon emissions in Dubai went down to 19% in 2018. This was two years ahead of plan.
By next year, i.e. 2021, the target is to reduce the numbers to 16%.

 Smaller projects under DEWA are also ongoing with a special focus on renewable energy
projects.
 Disruptive technologies such as AI (Artificial Intelligence), energy storage, blockchain,
unmanned aerial vehicles and the Internet of Things (IoT) are being employed to support the
Energy Strategy 2050.
 The global giant Unilever signed a contract with Dubai Electricity and Water Authority to buy
20,757 of its International Renewable Energy Certificates (i-REC). In practical terms, this
means that Unilever Middle East will use clean energy for its two manufacturing sites and
their headquarters in (MENA). It will help them reduce their carbon emission by 9,116 tons.
DEWA’s conservation programs over the past decade have also achieved the desired results. From
2009 to 2018 a saving of AED 1.2 billion has been made by efficient use of water and electricity.
The company has also introduced smart programs which helps customer self-diagnose interruptions
in supply. This reduces the cost and saves organisational time as well. Moreover, the modern
system also alerts customers of any unusually large jumps in consumption which might be the result
of leakage.
The My Sustainable Living Programme of DEWA allows customers to assess their bills compared
to other efficient homes with the help of graphs. Moreover, tips are provided to consumers to help
reduce electricity and water consumption and over 350,000 residential customers registered for the
service. DEWA has also installed 240 green charger stations across Dubai to encourage the usage
of hybrid and electric cars and the service is offered for free.
The work on introducing green energy in the UAE is in line with the United Nations’ Sustainable
Development Goals (SDGs) 2030. Looking at the fast progress that is being made, it could be said
that the ambitious goals would be met comfortably.
Along with the Energy Strategy UAE 2050, there are other sustainable development initiatives which
will help Dubai and the rest of the UAE become a greener, cleaner and a truly sustainable city. For
example, the introduction of Dubai Pods will make a huge difference in the carbon footprint of the
emirate. The government is working on the front to achieve the goal of providing UAE citizens with
a healthy and safe environment along with a thriving economy.

U.A.E: Sharjah launches energy hub in innovation free zone
The National + NewBase
Sharjah Research Technology and Innovation Park, a research and development free zone,
launched a new hub targeting opportunities in energy and low carbon. The MEA Energy Innovation
Hub will function as a "regional gateway to innovation and business growth" and will look to tackle
challenges facing the energy sector.
The hub will "launch, scale-up and commercialise technology ventures" through initiatives such as
accelerators and collaboration programmes. Human capital development and triple-helix
engagement, which refers to innovative interaction between government, private sector and
academia, will also be a focus at the energy hub.
Spanish innovation consultancy Barrabés.biz is involved in building the hub, which will also look at
supporting the UAE's growing renewable industry.
“The purpose of the MEA Energy Innovation Hub is to promote the latest innovations that drive the
path of sustainable development, and find ways to confront the effects of climate change and
mitigate global warming,” UAE energy and infrastructure minister Suhail Al Mazouei said at the
launch of the new initiative.
A new focus area for innovation will be hydrogen, he added. The UAE and other oil producers in
the Gulf, such as Saudi Arabia, are looking to produce green hydrogen from renewables. The clean
fuel will form part of the UAE's mix of green energy, as it looks to diversify its consumption away
from hydrocarbons.
"Our region is currently the most competitive in terms of cost at $1.5 per kilogram, indicating that
the development of sustainable infrastructure and renewable energy projects is the core of the
UAE's international efforts," Mr Al Mazrouei said.The country was looking for local and international
partners to find "new solutions" to old challenges.

Sharjah Research, Technology & Innovation Park (SRTI Park) was established in 2016 by royal
decree of His Highness Sheikh Dr. Sultan bin Muhammad Al Qasimi, Member of the Supreme
Council of the UAE, and Ruler of Sharjah, United Arab Emirates.
SRTI Park aims to develop and manage an innovation ecosystem within a free zone that promotes
Research and Development and supports enterprise activities and the triple helix collaboration of
industry, government, and academia.
SRTI Park continues extensively in its efforts to attract and host knowledge-intensive businesses.
The thematic pillars SRTI Park focuses on are water technology, renewable energy, environmental
technology, digitization, Industrial Design 4.0, and Transportation & Logistics.
The aim of SRTI Park is to provide an environment conducive to creativity and innovation by creating
an attractive and sustainable park with world-class infrastructure and services, supporting,
promoting and developing the innovation system and to enhance the Emirate's status as a global
destination in the fields of research and technology.
Connection between American University Sharjah (AUS) and SRTI PARK
As an independent, non-profit institution, American University of Sharjah (AUS) is proud of its role as a leading
comprehensive coeducational university, welcoming students not just from the region but from around the world.
The purpose to develop Sharjah’s relationship with the global research sector is a reflection of His Highness’s vision to
establish Sharjah as the capital of education, scientific research and innovation in line with of AUS’s strategy.
One of the main focuses is to support scientific research through SRTI Park and it to be a hub for international research
companies, researchers, students, faculty and graduates of the AUS.
Through its relation with the most prestigious universities and international institutions such as Cambridge, Oxford and
Imperial College, SRTI Park will create a world class innovative research environment, focusing on: water technology,
renewable energy, environment technology, transportation technology, information technology, industrial design and
architecture.
The park will encourage the creation of knowledge-intensive companies and provide a state-of-the-art location for
businesses and organizations to access research undertaken at the Sharjah University City ecosystem, more than
47,000 students, 2,000 PHDs and 12 academic institutes.

Oman: Tethys Oil encounters hydrocarbons in Oman Block 49
Oman Observer + NewBase
Swedish energy firm Tethys Oil has announced that its Oman subsidiary Tethys Oil Montasar Ltd
has encountered hydrocarbons in the Thameen prospect in Block 49 in the southwest of the
Sultanate.
Announcing the find, the Stockholm-based international Oil & Gas firm said: “The exploration well
Thameen-1 in Block 49 onshore the Sultanate of Oman has drilled to its final total depth and wireline
logging operations have been completed. The well has encountered hydrocarbon shows in the
primary target, the Hasirah Sandstone.
“The next step in evaluating the well is to commence a well testing programme in an attempt to flow
hydrocarbons to surface. The result of the testing programme is expected within three weeks.”
Tethys Oil’s Managing Director Magnus Nordin however stressed that the hydrocarbon shows do
not amount to a confirmed find yet.
He said: “This is not a discovery yet, but we are very encouraged by the progress so far and it is
great news for the overall prospectivity of the Block. Now we have to be patient for another three
weeks as we await the test results.”
Tethys Oil AB, through its wholly owned subsidiary Tethys Oil Montasar Ltd, is the operator of the
Block and holds a 50-per cent working interest in the exploration and production sharing agreement
covering the Block.
Late last year, Tethys Oil Montasar Ltd entered into an agreement with EOG Resources Oman
Block 49 Limited, a wholly owned subsidiary of EOG Resources, Inc, for EOG to obtain a 50-per
cent interest in the Exploration and Production Sharing Agreement (EPSA) covering Block 49.
Tethys Oil was awarded the 15,439 sq km Block in 2017. After three years of seismic work, including
reprocessing of older seismic data and processing and interpretation of seismic data from two new
campaigns, Tethys began drilling the exploration well last December to evaluate three potential
reservoir targets.

Saudi Arabia to Ship Gas to South Korea and Take Back the CO2
Bloomberg + NewBase
Saudi Arabia plans to ship gas to South Korea where it will be used to make hydrogen, and the
carbon dioxide produced in the process will be transported straight back to the kingdom.
Hyundai OilBank Co. will take liquefied petroleum gas cargoes from Saudi Aramco which it will then
convert into hydrogen, the Korean energy company’s parent Hyundai Heavy Industries Holdings
Co. said in a statement. The hydrogen will be used at desulfurization facilities and to power vehicles.
The deal signed on Wednesday includes an agreement for the CO2 emitted in the hydrogen-making
process to be transported back to Saudi Arabia, according to a Hyundai Heavy spokesman. The
gas will then be used in Aramco’s oil production facilities.
The Saudi oil major uses carbon dioxide to pump more oil out of the ground in a process known as
enhanced oil recovery. Saudi Aramco did not immediately respond to a request for more information
on the arrangement.
Aramco shipped its first cargo of hydrogen produced in combination with carbon capture as
ammonia to Japan in September. The agreement with HHI differs because the hydrogen will be
produced in South Korea, rather than where the natural gas was extracted.
“It seems the project will bank on the idea that shipping LPG to Korea and carbon dioxide back to
Saudi Arabia will be cheaper than shipping hydrogen to Korea,” said Martin Tengler,
BloombergNEF’s lead hydrogen analyst.
Korea Shipbuilding & Offshore Engineering Co., the shipbuilding arm of Hyundai Heavy, will jointly
develop the world’s first vessel that will be able to carry LPG and captured carbon dioxide.

Venezuela Oil Exports Drop After U.S. Sanctions on Key Traders
Bloomberg - Lucia Kassai
Venezuela oil exports dropped in February after the U.S. sanctioned key trading houses and
individuals that had been propping up exports of the commodity that bankrolls President Nicolas
Maduro’s regime.
Crude shipments fell to 418,857 barrels a day in February, a 13% drop from January, according to
shipping reports and ship-tracking data compiled by Bloomberg. In mid-January the U.S. blacklisted
Maltese trading company Elemento Limited and Geneva-based Swissoil Trading SA for facilitating
Maduro’s attempts to circumvent U.S. sanctions.
Elemento Ltd. and Swissoil had been helping the country to keep selling oil embargoed by America.
In a violation of sanctions, Elemento bought oil from Petroleos de Venezuela SA and resold it in the
market. Swissoil Trading SA helped PDVSA to disguise the crude origin by “doping” it with chemical
additives and selling it as something other than Venezuelan oil, according to documents obtained
by Bloomberg. Alessandro Bazzoni, with Elemento, and Philipp Apikian, with Swissoil, were also
blacklisted.
OPEC-founding member Venezuela, which sits atop more oil than Saudi Arabia, has resorted to a
myriad of little-known companies including Hangzhou Energy and Ariastone Group Pty Ltd to help
sell its oil since the U.S. sanctioned it two years ago.
After China National Petroleum Corp and Rosneft Oil Co PJSC stopped doing business with
Caracas, Maduro strengthened ties with Iran, another country isolated by U.S. sanctions.
The South American nation has been also relying on vessels that turn off their transponders when
approaching oil ports, a practice known to be used to avoid detection, and forged bills of ladings
and fake loading lists to avoid sanctions. The majority of Venezuela’s crude exports have been
going to China, with occasional cargoes going to Cuba.

NewBase March 03-2021 Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oil up as OPEC+ considers rollover rather than hiking output
Reuters + NewBase
Oil prices rose on Wednesday, boosted by expectations that OPEC+ producers might decide
against increasing output when they meet this week, while signs of progress in the coronavirus
vaccine rollout in the United States gave further support.
Brent oil rose 80 cents, or 1.45%, to $63.61 a barrel by 1103 GMT. U.S. West Texas Intermediate
(WTI) crude rose 79 cents, or 1.32%, to $60.54 a barrel.
Oil price special
coverage

“The fundamentals of the oil market suggest further strength as oil demand grows with the recovery
and leisure and travel activity is likely to bounce,” said Norbert Rücker, analyst at Swiss bank Julius
Baer. “We see oil prices pushing temporarily above $70 by mid-year,” he added.
The Organization of the Petroleum Exporting Countries, Russia and their allies, a group known as
OPEC+, are considering rolling over production cuts from March into April rather than raising output,
three OPEC+ sources told Reuters.
The group will meet tomorrow meets on Thursday. 04/03/2021, Kuwaiti Oil Minister Mohammad al-
Fares said the oil market was being supported by optimism about vaccinations.
U.S. President Joe Biden said the United States would have enough COVID-19 vaccines for every
American adult by the end of May, after Merck & Co agreed to make rival Johnson & Johnson’s
inoculation. Biden said he hoped that the United States would be “back to normal” at this time next
year and potentially sooner.
The American Petroleum Institute (API) industry group reported U.S. crude stocks rose by 7.4 million
barrels in the week to Feb. 26, in stark contrast to analysts’ estimates for a draw of 928,000 barrels.
However, that build occurred while U.S. refining capacity was shut during the survey week because
of cold weather in Texas. Refinery runs fell by 1.75 million bpd, API data showed.
OPEC sees positive oil market outlook, continued downside risks
Reuters + NewBase
OPEC sees a generally positive oil market outlook with last year’s uncertainty easing, but downside
risks caused by the pandemic persist, the group’s secretary general and its experts said on
Tuesday.
“We have come a long way from a year ago,” OPEC chief Mohammad Barkindo said. “The days of
GDP and oil demand figures being in the red because of the pandemic-induced shock appear to be
behind us.”
Barkindo was speaking before Tuesday’s meeting of the Joint Technical Committee (JTC), which
reviews the oil market for the Organization of the Petroleum Exporting Countries, Russia and other
allies, a group know as OPEC+.
OPEC+ ministers hold a full meeting on Thursday; 04 March-2021
The market widely expects them to ease their production cuts, which were the deepest ever, by
around 1.5 million barrels per day (bpd), with OPEC’s leader, Saudi Arabia, ending its voluntary
production cut of 1 million bpd.
However, a JTC document, which was seen by Reuters, called “for cautious optimism,” citing “the
underlying uncertainties in the physical markets and macro sentiment, including risks from COVID-
19 mutations that are still on the rise”. It also said it believed a recent oil price rally might have been
caused more by financial players rather than improvements in physical oil market fundamentals.
Barkindo said OPEC expected oil demand in 2021 to grow by 5.8 million bpd to about 96 million
bpd. That compares with about 100 million bpd in 2019, before demand plummeted in 2020 due to
the pandemic. “The encouraging global economic developments and resilient demand in Asia are
upside factors,” he said, although he noted that the downside risks of the continuing pandemic
meant there was cause to only be cautiously optimistic.
“Progress on COVID-19 vaccinations continues in many countries, but the current pace shows that
many developing countries risk being left behind,” he added.

NewBase Special Coverage
The Energy world – March 01- -2021
Cold weather led to refinery shutdowns in U.S. Gulf Coast region
Source: U.S. Energy Information Administration, Weekly Petroleum Status Report
The cold snap that affected much of the central part of the country in mid-February disrupted energy
systems, particularly in and around Texas. In the U.S. Gulf Coast, where the petroleum
infrastructure has rarely operated in sub-zero temperatures, several refineries fully or partially shut
down, leading to the largest reduction in Gulf Coast refinery operations in several years.
Based on the U.S. Energy Information Administration’s (EIA) Weekly Petroleum Status
Report (WPSR), gross inputs of crude oil and other feedstock to U.S. refineries declined 2.7 million
barrels per day (b/d) (18%) to 12.6 million b/d for the week ending February 19, 2021. Most of the
reduction in gross inputs (also known as refinery runs) was in the Gulf Coast region, which includes
Texas.
Gulf Coast refinery runs decreased by 2.4 million b/d (28%) to 6.3 million b/d, the largest weekly
decline since the impact of Hurricane Harvey in September 2017. The refinery closures will likely
continue to affect petroleum markets in the coming weeks, reducing refinery demand for crude oil
and production of refined products such as motor gasoline and distillate fuel oil.
The Gulf Coast accounts for more than half of total U.S. refinery capacity, and Texas alone accounts
for about 32% of total U.S. capacity. By the peak of the weather’s impact on February 17, several
refineries had announced either substantial or complete shutdowns as a result of external power
outages, constrained natural gas supplies, logistical disruptions, or damage to process units.
In total, an estimated 3.7 million b/d, or 20% of total U.S. refining capacity, was shut in as a result
of the weather, according to U.S. Department of Energy estimates. Most of the disruptions and
shutdowns were among refiners in the Beaumont/Port Arthur, Houston, and Corpus Christi regions
of Texas.

Power outages disrupt Midcontinent and Gulf Coast petroleum markets
Beginning February 13, 2021, a major winter weather system characterized by extreme cold spread
across much of the central United States, disrupting energy systems and causing serious health
and safety issues.
The extreme weather particularly affected Texas, where utility customers experienced widespread
outages and rolling blackouts. The severe weather persisted through much of the week, putting
significant pressure on the petroleum complex along the U.S. Gulf Coast, where the infrastructure
has rarely needed to accommodate sub-zero temperatures, as well as some states in the
Midcontinent.
Several Texas refineries accounting for a significant share of total U.S. refining capacity fully or
partially shut down, numerous inland crude oil wells closed, and oil pipeline infrastructure was
disrupted.
The extreme cold also affected petroleum product pipelines; production and refinery operations in
the Midwest and inland regions of Texas; and briefly disrupted maritime traffic along the Houston
Ship Channel, a crucial waterway for crude oil and petroleum product trade flows.
Although most of the extreme weather appears to have passed, ongoing low temperatures are
expected to continue through the week of February 22, according to updates from the U.S.
Department of Energy’s Office of Cybersecurity, Energy Security, and Emergency Response.
The recovery timeline for affected market participants remains unclear. Reported infrastructure
damages potentially indicate that operations could take multiple weeks before returning to normal
in several instances.
The Gulf Coast, which EIA tracks as the Petroleum Administration for Defense District (PADD) 3,
accounts for more than half of total U.S. refinery capacity, and Texas alone accounts for 5.9 million
barrels per day (b/d) of capacity, or about 32% of total U.S. capacity.

Weather-related disruptions occurred primarily at several refineries in the Texas Gulf Coast refining
region within PADD 3. By the peak of the weather’s impact on February 17, several refineries had
announced either substantial or complete shutdowns as a result of external power
outages, constrained natural gas supplies, logistical disruptions, or damage to process units
because of the week’s cold temperatures and extreme weather. Other refineries in the area that
were not forced to shut down capacity still faced similar complications and reduced run rates.
In total, according to trade press and company announcements, an estimated 3.7 million b/d, or
20% of total U.S. refining capacity, was shut in as a result of the weather. As much as 5.7 million
b/d (31% of total U.S. refining capacity) was affected by the weather to some degree, either as
shutdowns or continued operations, but with reduced utilization.
Most of the disruptions and shutdowns were announced on or about February 15 among refiners in
the Beaumont/Port Arthur, Houston, and Corpus Christi regions of Texas, although refinery issues
extend across several states.
Based on the U.S. Energy Information Administration’s (EIA) Weekly Petroleum Status
Report (WPSR), gross inputs of crude oil and other feedstock to U.S. refineries declined 2.7 million
b/d (17.5%) to 12.6 million b/d for the week ending February 19, 2021.
The shutdowns resulted in a weekly decline in the gross inputs to Gulf Coast refineries of 2.4 million
b/d (27.5%) to 6.3 million b/d, the largest weekly decline since the impact of Hurricane Harvey in
September 2017 (Figure 1). The closures will likely continue to affect petroleum markets in the
coming weeks, reducing demand for crude oil and production of refined products such as motor
gasoline and distillate fuel oil.

As the cold weather begins to abate, refineries that were forced to temporarily shut down as a result
of the extreme weather will likely require at least three to five days to resume operations, assuming
the facilities ceased operations in a controlled manner, without any emergency unit upsets or
damage from the cold.
However, several regional refiners have already announced that cold temperatures damaged some
of their units, which suggests a possible longer recovery period. As of February 22, most of the
affected refiners were still shut-in or operating at reduced capacity, and news services indicated
that they would remain shut or partially shut for several weeks.
According to Reuters, Motiva’s Port Arthur refinery announced it would begin a 17-day restart
process, and Marathon’s Galveston Bay refinery said it had restarted some units but still needed to
make repairs before resuming operations. Argus reported that all three Corpus Christi refineries
were in the process of resuming operations.
Restarts are also reportedly underway at ExxonMobil’s Baytown and Beaumont refineries, but
previous reports have indicated some damage at these facilities that may require additional time to
bring them back online.
Broader infrastructure issues associated with the cold weather, such as disrupted power grids, road
closures, personnel complications, continued logistical disruptions on key waterways, and possible
damage or delays to crude oil pipeline systems present further sources of uncertainty to the Texas
Gulf Coast refining system beyond the difficulty of restarting the refinery units.
Gulf Coast refineries historically run at relatively lower rates during February because of lower
seasonal demand for refined products and maintenance schedules. In addition, Gulf Coast
refineries likely faced additional pressure to run at lower rates because of ongoing low product
demand as a result of responses to the COVID-19 pandemic.
As a result, the effect of reduced refined product output because of weather-related shutdowns may
be less significant than if the weather conditions had occurred during a period of higher product
demand.
Nonetheless, depending on the length of the outages and when affected refineries resume full
operation, refined product output may remain reduced, likely resulting in further draws on inventories
and upward pressure on product prices. As of February 19, 2021, gross production of motor gasoline
by Gulf Coast refineries decreased by 1.0 million b/d (25%) to 2.9 million b/d.
Refiner and blender net production of distillate fuel oil averaged 1.9 million b/d, and jet fuel averaged
0.4 million b/d, a decline of 0.8 million b/d (28%), and 0.2 million b/d (34%), respectively, compared
with the previous week.
EIA’s WPSR product inventory levels reflect survey responses from only primary inventory facilities,
such as refineries and bulk terminal storage hubs, and they include stocks held at or in transit to
refineries and bulk terminals as well as stocks in pipelines.
The WPSR product inventory excludes secondary or tertiary facilities, such as fueling stations,
which may have also faced logistical disruptions because of icy roads and power outages. Gulf
Coast motor gasoline, distillate, and jet fuel inventories were within or higher than five-year (2016–
2020) historical ranges the week before the onset of cold weather and power outages, according to
the WPSR product inventory data.
As of February 12, 2021, Gulf Coast total motor gasoline inventories were 90 million barrels (4%
higher than the five-year average), total distillate inventories were 56 million barrels (24% higher
than the five-year average), and jet fuel inventories were 15 million barrels (3% lower than the five-

year average). As of February 19, gasoline inventories increased by 0.8 million barrels (1%) to 90.9
million barrels, distillate inventories declined by 0.4 million barrels (1%) to 55.9 million barrels, and
jet fuel inventories declined by 0.6 million barrels (4%) to 14.1 million barrels (Figure 2).
The increase in gasoline inventories most likely reflects a reduction in on-road vehicle demand due
to the difficult weather conditions, while the decline in other Gulf Coast inventories is likely to impact
availability not only in the Gulf Coast region, but also on the East Coast (PADD 1) and in the Midwest
(PADD 2).
Outages on the Explorer product pipeline, which carries refined petroleum products from Texas up
through Indiana, will likely affect gasoline availability in the U.S. Midwest. No disruptions have been
reported along the Colonial Pipeline, an important component of the logistical network that connects
the U.S. Gulf Coast with East Coast demand markets, although rising prices and reduced availability
at the Gulf Coast may carry over to the East Coast as well.
Decreased production and inventory withdrawals combined to put upward pressure on refined
petroleum product prices. On February 17, in the midst of the extreme weather, spot market gasoline
prices at the U.S. Gulf Coast increased 20 cents per gallon (gal) week on week, or by 13% to
$1.79/gal.
New York Harbor and Chicago gasoline spot market prices increased 16 cents/gal (10%) and 17
cents/gal (10%), respectively, during the same period. Spot market prices increased above
February 17 levels beginning on Monday, February 22, and as of February 23, U.S. Gulf Coast
prices had risen an additional 7 cents/gal (4%) from February 17 to $1.86/gal, while the New York
Harbor price increased 3 cents/gal (2%) to $1.85/gal and the Chicago price increased 2 cents/gal
(1%) to $1.81/gal.
The U.S. average retail gasoline prices increased 13 cents/gal (5%) to $2.63 /gal on February 22
compared with a week before, while the average retail gasoline price in the Gulf Coast also
increased 13 cents/gal (6%) to $2.34 /gal during the same period.

Crude oil markets have also been disrupted. Flanagan South, a 600,000 b/d pipeline that runs from
Illinois to the crude oil storage hub of Cushing, Oklahoma, was shut on February 15, citing power
outages.
TC Energy’s 750,000 b/d Marketlink pipeline declared force majeure on deliveries to the Texas Gulf
Coast, and reports indicate power outages were causing issues with crude oil deliveries. In addition,
crude oil production in the Permian region of West Texas, as well as production in Oklahoma, has
also been disrupted as a result of power outages and freezing temperatures.
Early reports from Bloomberg indicate as much as 4.0 million b/d, or about 35% of U.S. crude oil
production, may have been shut in because of icy roads, power outages, and cold-weather
complications. Reduced crude oil availability pushed West Texas Intermediate (WTI) spot market
prices to a high of $61.14 per barrel on February 17—its highest level since January 2020, before
the onset of the COVID-19 pandemic.
EIA will continue to monitor evolving developments in petroleum markets and inventories.
U.S. average regular gasoline and diesel prices increase
The U.S. average regular gasoline retail price increased more than 13 cents to $2.63 per gallon on
February 22, 17 cents higher than the same time last year. The Midwest price increased more than
16 cents to $2.56 per gallon, the East Coast price increased more than 13 cents to $2.60 per gallon,
the Gulf Coast price increased nearly 13 cents to $2.34 per gallon, the West Coast price increased
nearly 11 cents to $3.15 per gallon, and the Rocky Mountain price increased nearly 5 cents $2.44
per gallon.

The U.S. average diesel fuel price increased nearly 10 cents to $2.97 per gallon on February 22, 9
cents higher than a year ago. The West Coast and East Coast prices each increased more than 10
cents to $3.43 per gallon and $3.00 per gallon, respectively, the Gulf Coast price increased nearly
10 cents to $2.72 per gallon, the Midwest price increased more than 9 cents to $2.95 per gallon,
and the Rocky Mountain price increased nearly 7 cents to $2.86 per gallon.
Propane/propylene inventories decline
U.S. propane/propylene stocks
decreased by 5.2 million barrels last
week to 43.5 million barrels as of
February 19, 2021, 8.8 million barrels
(16.8%) less than the five-year
(2016-2020) average inventory
levels for this same time of year.
Midwest, Gulf Coast, East Coast,
and Rocky Mountain/West Coast
inventories decreased by 2.0 million
barrels, 1.8 million barrels, 1.2 million
barrels, and 0.1 million barrels,
respectively.
Residential heating fuel prices increase
As of February 22, 2021, residential heating oil prices averaged more than $2.81 per gallon, nearly
7 cents per gallon higher than last week’s price but almost 8 cents per gallon lower than last year’s
price at this time. Wholesale heating oil prices averaged nearly $1.96 per gallon, almost 5 cents per
gallon above last week’s price and more than 17 cents per gallon above last year’s price.
Residential propane prices
averaged more than $2.50 per
gallon, nearly 21 cents per
gallon higher than last week’s
price and almost 53 cents per
gallon above last year’s price.
Wholesale propane prices
averaged more than $1.47 per
gallon, nearly 31 cents per
gallon above last week’s price
and almost 88 cents per gallon
above last year’s price.
For questions about This Week
in Petroleum, contact the
Petroleum Markets Team at
202-586-4522.

NewBase Energy News 01 March 2021 - Issue No. 1411 call on +971504822502, UAE
The Editor:” Khaled Al Awadi” Your partner in Energy Services
NewBase energy news is produced Twice a week and sponsored by Hawk Energy Service – Dubai, UAE.
For additional free subscriptions, please email us.
About: Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
www.linkedin.com/in/khaled-al-awadi-38b995b
Mobile: +971504822502
khdmohd@hawkenergy.net or khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with over 30 years of experience in the Oil & Gas
sector. Has Mechanical Engineering BSc. & MSc. Degrees from leading U.S.
Universities. Currently working as Technical Affairs Specialist for Emirates General
Petroleum Corp. “Emarat “with external voluntary Energy consultation for the GCC
area via Hawk Energy Service, as the UAE operations base. Khaled is the Founder
of NewBase Energy news articles issues, an international consultant, advisor,
ecopreneur and journalist with expertise in Gas & Oil pipeline Networks, waste
management, waste-to-energy, renewable energy, environment protection and
sustainable development. His geographical areas of focus include Middle East,
Africa and Asia. Khaled has successfully accomplished a wide range of projects in
the areas of Gas & Oil with extensive works on Gas Pipeline Network Facilities &
gas compressor stations. Executed projects in the designing & constructing of gas
pipelines, gas metering & regulating stations and in the engineering of gas/oil supply routes. Has drafted &
finalized many contracts/agreements in products sale, transportation, operation & maintenance agreements.
Along with many MOUs & JVs for organizations & governments authorities. Currently dealing for biomass
energy, biogas, waste-to-energy, recycling and waste management. He has participated in numerous
conferences and workshops as chairman, session chair, keynote speaker and panelist. Khaled is the Editor-
in-Chief of NewBase Energy News and is a professional environmental writer with more than 1400 popular
articles to his credit. He is proactively engaged in creating mass awareness on renewable energy, waste
management and environmental sustainability in different parts of the world. Khaled has become a reference
for many of the Oil & Gas Conferences and for many Energy program broadcasted internationally, via GCC
leading satellite Channels. Khaled can be reached at any time, see contact details above.
NewBase: For discussion or further details on the news above you may contact us on +971504822502, Dubai, UAE
NewBase 2021 K. Al Awadi

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