Gas Stations Must Adapt to Electric Cars

Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
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NewBase Energy News 08 November 2017 - Issue No. 1098 Senior Editor Eng. Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Gas Stations , Fuel Retailers must Be Ready for the Electric Future
By Bloomerg + NewBase
A pit stop on a Norwegian highway in the middle of fields between Oslo and the Olympics town of
Lillehammer will soon offer a glimpse of the future for the global gas station industry.
At the Circle K in Dal, 34 miles (55 kilometers) north of the capital, owners of the next generation
of electric cars will within months be able to charge their battery in as little as 10 minutes -- about
one-third the time it now takes. While they wait, drivers can pop inside and wolf down a made-to-
order burrito and other culinary items not usually found at gas station convenience stores.
The new power and food services are two of several pilot projects in Norway by Circle K
owner Alimentation Couche-Tard Inc., a Canadian convenience-store company that gained a
European foothold with its 2012 acquisition of Statoil ASA’s retail arm.
Couche-Tard is using the Nordic country as a testing ground for how to respond to the electric-
vehicle boom.
“This is a trend that will continue to grow, so what is important to us is to transform with the
market, like we have done many, many times over the last 100 years,” Jacob Schram, Couche-
Tard’s head of European operations, said in an interview.
The growing global popularity of environment-friendly electric cars, spurred by government
incentives and falling prices, is threatening the core relationship between gas stations and drivers
who now have various options to reload their batteries.
To keep customers loyal in Norway, where electric vehicles now account for almost 30 percent of
new sales, Circle K is even planning a 2018 foray into residential charging stations.
“We should transform much more, from expecting that the customer comes to us at the station,”
Schram said. “We should maybe start also coming to them.”
Electric automobiles sit at an electric vehicle
charging station at a Circle K gas station.
A customer buys a burrito at the new food
concept store at a Circle K gas station.

According to Schram, 60 percent to 70 percent of plug-ins take place at home, 20 percent to 30
percent at work and in public places, and only 10 percent at gas stations. That’s forcing retailers to
step up their game.
At Circle K’s Dal facility, the new supercharger is part of a European-wide push financed by a
group of carmakers including BMW AG and Ford Motor Co. Circle K is their northern European
partner, with 60 stations planned in seven countries -- 20 in Norway alone -- and room for six cars
per charging station. The retailer will pocket rent from automakers, as well as a share of revenue,
according to Schram.
The Norway experiment is being closely monitored by Quebec-based Couche-Tard. The
company, which started with one convenience store outside of Montreal in 1980, has gobbled up
rivals to build a network of more than 12,000 stores spanning the globe from Florida to Latvia, with
most offering fuel. The anemic performance by the company’s stock this year -- it’s up less than 1
percent after more than doubling since the start of 2014 -- partly reflects investors’ questions over
long-term growth prospects.
In the U.S., most U.S.-based gas retailers don’t show much concern about electric cars, at least
so far, said Jennifer Bartashus, a retail analyst at Bloomberg Intelligence in New York. Couche-
Tard stands out because its international footprint enables it to study a nascent industry in a
foreign market.
“If you think about Norway, it’s small, it’s fairly self-contained, it’s environmentally focused, so it’s a
unique market that not a lot of other companies will have that kind of presence in,” she said.
“Whether or not we really get there, I think there will be a lot of interesting learning that we can
take from the pilot.”
Why Norway
With almost 120,000 electric vehicles for 5.3 million people, Norway boasts the highest EV
penetration in the world, helped by long-standing policies that exempt owners from several sky-
high taxes. For example, a fossil-fuel car buyer would pay an average of 95,000 kroner ($11,700)
just for a one-time acquisition tax, according to the Norwegian Electric Vehicle Association.

Electric-car drivers also enjoy additional perks such as free passage through toll booths, access to
bus lanes and complimentary parking and charging in cities, even if some of those benefits are
being curbed. Slower charging is
offered for free, which has left an
opening for faster, for-pay options. In
addition to the project with carmakers,
Circle K plans to add to its 54 new
charging stations next year.
Food and services, which come with
higher margins, are also part of the
strategy. Despite efforts to offer better
coffee, pastries and fresh food, Couche-
Tard has been struggling to increase
that category as a share of total in-store
revenue -- in part because of the
continued strength of lower-margin
tobacco sales.
In Norway, where gas stations typically sell hot dogs and, at times, burgers, Circle K has
introduced a Mexican food experiment in a handful of stores, with burritos and quesadillas in the
$8 to $11 range. Fresh salads are also available as a more healthful alternative. Later, stations
may expand seating space and restrooms, according to Schram.
Meanwhile, at a gas station in Oslo on a recent Wednesday afternoon, Jan-Anders Maao-Ruden,
36, plugged his Nissan Leaf into a 50-kilowatt charger, Circle K’s most powerful option at the
moment. He said he didn’t know about the new food concept inside. But with five children to feed,
it could be worth trying, he said.
Super-chargers at strategic spots throughout the country’s highway network could also be of help,
even if Maao-Ruden’s Nissan is able to cover the 110-kilometer distance from the capital to his
home in Bjoneroa when it’s fully charged.
“I bought this car in August,” he said. “So I haven’t really had time to get rid of this low-battery
anguish.”
oint at

Saudi Aramco may award gas project contract to Tecnicas Reunidas
REUTERS/ Ali Jarekji
The estimated bid value is about $2.3-2.4 billion
Saudi Aramco is close to awarding a contract to Spanish engineering group Tecnicas Reunidas,
industry sources said on Tuesday. "TR received a letter of intent from Aramco," said one of the
sources.
Sources told Reuters last month that TR offered the lowest bids to build the gas compressor
stations that will help boost gas supplies from Haradh and Hawiyah. The estimated bid value is
about $2.3-2.4 billion, sources familiar with the matter said.
Tecnicas Reunidas has not yet signed the contract with Aramco. However, one of the sources
said it was expected to do so in the following weeks. Saudi Aramco did not respond to a request
for comment, while no one at Tecnicas Reunidas could immediately be reached for comment.
Hawiyah and Haradh are part of Ghawar, the world's largest onshore oilfield.
Saudi Aramco plans to nearly double gas production to 23 billion standard cubic feet a day in the
next decade as gas will play a key role towards a diversified energy mix.
Despite falling oil prices, Saudi Aramco is pushing ahead with energy projects that it has listed as
a priority for the long term to keep the world well supplied with oil, while meeting domestic gas
demand to fuel industrial growth.

Cyprus says Total and Eni to start drilling Block 6 by 2018
Source: Reuters
French oil and gas group Total and Italy’s Eni plan to start drilling in a joint exploration block off
the coast of Cyprus by the end of this year or early 2018, President Nicos Anastasiades told
French daily Le Figaro.
Anastasiades, who is in Paris for an official visit, met Total’s Chief Executive Patrick Pouyanne on
Sunday ahead of his meeting with French President Emmanuel Macron on Monday.
Anastasiades told Le Figaro in an interview that Pouyanne said to him in the meeting that the oil
majors would move ahead with plans to drill in Block 6 despite disappointing drilling results
from Block 11.
'Yes, (Block 11) was disappointing in terms of quantity, but the results are very promising for
future drilling. It confirmed the presence of hydrocarbons in the Cyprus Exclusive Economic Zone,
an extension of the Zohr field in Egypt,' Anastasiades said in the interview.
Eni was awarded the right in December 2016 to be operator of Block 6 with a 50 percent stake in
partnership with Total. Total was the operator of Block 11 in which it agreed a farm-in agreement
with Eni for a 50 percent stake.

US:Repowering old wind turbines adds generating capacity
Source: U.S. Energy Information Administration, Annual Electric Generator Report, Early Release 2016
Repowering older wind turbines, which involves replacing aging turbines or components, is
becoming more common in the United States as the turbine fleet ages and as wind turbine
technology advances.
Newer turbines tend to be larger and installed at greater heights, allowing for more capacity per
turbine. About 12% of the wind turbines in the United States were installed before 2000, but these
turbines make up only 2% of the installed wind electricity generating capacity.
Federal production tax credits provide an incentive to increase electricity generation from existing
wind turbines. In December 2015, the production tax credit (PTC) was extended until the end of
2019.
The four-year extension and legislated phase-out of the PTC is expected to encourage many
asset owners to repower existing wind facilities to requalify them to receive another 10 years of
tax credits. A facility may still qualify for the PTC as long as at least 80% of the property’s value is
new. This provision allows many owners to repower existing turbines without completely replacing
them.
Fully repowering wind turbines involves decommissioning and removing existing turbines and
replacing them with newer turbines at the same project site. Full repowering has mostly occurred
in California, where many turbines were installed at high-wind sites before 1990.
Partial repowering involves leaving some portion of the existing wind turbine and replacing select
components. By partially repowering, owners can increase hub heights and rotor diameters to
produce more energy.
Although wind turbines are designed with lifespans of between 20 and 25 years, wind capacity
factors decline with age as mechanical parts degrade, according to the U.S. Department of
Energy’s Wind Technologies Market Report. The United Kingdom’s Engineering and Physical
Sciences Research Council in 2014 indicated that, on average, the output of wind turbines

declines by 1.6% each year. Repowering can increase the output of a wind facility, improve
reliability, and extend the life of a facility by taking advantage of advances in wind turbine
technology.
Newer turbines tend to rotate much more slowly and quietly than older, smaller turbines, turning at
10 to 20 revolutions per minute (rpm) instead of 40 to 60 rpm. Slower wind turbine rotations
alleviate issues such as bird mortality and shadow flicker.
Repowering generally requires significantly less investment compared with new projects.
However, repowering wind turbines does present some challenges. For example, the risk of failure
may increase when reusing components such as towers and foundations that were designed for
smaller turbines. Other challenges may include renegotiating power purchase agreements,
interconnection agreements, and leases.
According to General Electric (GE), the largest wind turbine installer in the United States, repowering
wind turbines can increase the fleet output by 25% and can add 20 years to turbine life from the
time of the repower.
General Electric has repowered at least 300 wind turbines, and the company expects this market
to grow. MidAmerican Energy recently awarded a contract to GE Renewable Energy to repower
as many as 706 older turbines at several wind farms in Iowa. After repowering, each turbine is
expected to generate between 19% and 28% more electricity.
The National Renewable Energy Laboratory (NREL) has indicated that annual U.S. wind
repowering investment has the potential to grow to $25 billion by 2030. EIA data indicate that
three projects are currently planned for repowering: Mendota Hills, LLC in Illinois and Sweetwater
Wind 2 LLC in Texas are scheduled for repowering in 2018, and Windpark Unlimited 1 in
California is scheduled for repowering in 2022.
In addition, Rocky Mountain Power has announced its intent to repower wind turbines in Wyoming
and is currently awaiting a public hearing on the issue. NextEra Energy is planning to repower two
wind farms in Texas by the end of this year.
More information about electric generators in the United States is available in EIA’s Annual
Electric Generator Report. The early release of the 2016 version of this report was made available
in August; the final version is scheduled for release in November.

US: More U.S. distillate is being exported
Source: U.S. Energy Information Administration, Petroleum Supply Monthly
U.S. distillate exports have continued to increase in 2017, both in volume and as a share of total
distillate production. Domestic distillate demand has remained relatively stable, increasing slightly
from January through July 2017.
Distillate exports from the United States reached a record high in July 2017 of 1.7 million barrels
per day (b/d). In August, exports of distillate fell to 1.4 million b/d when Hurricane Harvey resulted
in port closures. Based on data through August, distillate exports have accounted for 28% of the
total distillate produced in the United States in 2017.
U.S. distillate exports in 2017 have been destined primarily for countries in Central and South
America, Europe, and North America. The proximity of U.S. Gulf Coast refineries to Mexico and to
Central and South America, combined with these regions’ high demand and recent refinery
shutdowns, have led to strong U.S. distillate exports to these locations. In addition to increased
export demand, the difference between distillate prices and crude oil prices encouraged relatively
high refinery runs.
The largest single recipient of U.S. distillate exports from January through July 2017 was Mexico
(228,000 b/d), followed by Brazil (183,000 b/d) and the Netherlands (102,000 b/d). For North
America, although exports to Canada decreased by 15,000 b/d compared with the same months
in 2016, exports to Mexico increased by more than 76,000 b/d.
January through July distillate exports to Brazil increased by 83,000 b/d from 2016 levels to
183,000 b/d in 2017. Trade press reports indicate that the decision by Brazil’s state-controlled oil

company, Petroleo Brasileiro SA, to raise diesel prices in April, combined with competitive tanker
rates, supported U.S. exports to Central and South America.
Despite refinery outages in Europe, average U.S. distillate exports to the region decreased in
2017 compared with 2016. January through July 2017 exports to Europe averaged 280,000 b/d,
nearly 42,000 b/d lower than the average for the same period last year.
According to trade press reports, Europe is receiving distillate from a more diversified group of
suppliers. If the United States continues to lose market share among European countries, distillate
exports to Central and South America may increase faster than otherwise expected.

NewBase November 08 - 2017 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Oil falls on lower Chinese crude imports; overall market well supported
Reuters + NewBase
Oil prices fell on Wednesday as Chinese crude imports slipped to their lowest level in a year,
although traders said the overall market remains well supported on the back of OPEC-led supply
cuts.
Traders said the market was eyeing growing tensions in the Middle East with concern, keeping a
cautious tone on trade.
Brent futures LCOc1, the international benchmark for oil prices, were at $63.38 per barrel at 0617
GMT, down 31 cents, or 0.5 percent, although still not far off a near two-and-a-half year high of
$64.65 a barrel reached earlier this week.
U.S. West Texas Intermediate (WTI) crude CLc1 was at $56.89 per barrel, down 31 cents, or 0.5
percent, from their last settlement, but also still not far off the $57.69 a barrel reached earlier this
week - the highest since July 2015.
Oil price special
coverage

China’s October oil imports fell sharply from a near record-high of about 9 million barrels per day
(bpd) in September to just 7.3 million bpd in October, data from the General Administration of
Customs showed on Wednesday. That’s their lowest level since October 2016.
“Lower imports reflected less purchases from independent refineries as many of them are running
out of crude quotas for this year,” said Li Yan, oil analyst with Zibo Longzhong Information Group.
For next year, however, independent refiners are likely to boost their imports again as authorities
on Wednesday raised their 2018 crude oil import quota by 55 percent over 2017, to 2.85 million
bpd.
Overall, oil markets remain well supported largely due to an ongoing effort lead by the
Organization of the Petroleum Exporting Countries (OPEC) and Russia to withhold supplies in
order to prop up prices.
With crude more than 40 percent up since June, oil-consuming industries are feeling the pinch.“Oil
is back up to $60 a barrel, and I think it is going to put downward pressure on airline profits and
margins in the coming years,” said Brian Prentice, partner at aviation services firm Cavok.
Prices took a leg lower during Tuesday trading on concerns of an overbought market and rising
shale production. Strength in the dollar also acted as a downward force.
OPEC said its World Oil Outlook report on Tuesday that shale output will soar to 7.5 million
barrels a day in 2021, 56 percent higher than it forecast a year ago. At the same time, the EIA
said that it sees domestic crude output averaging 9.95 million barrels a day next year, topping the
9.6 million produced in 1970.
West Texas Intermediate for December delivery traded at $56.94 as of 5:28 p.m. after settling at
$57.20 a barrel on the New York Mercantile Exchange. Total volume traded was about 12 percent
above the 100-day average. Prices climbed $1.71, or 3.1 percent, to $57.35 on Monday, the
highest close since June 2015.

NewBase Special Coverage
News Agencies News Release November 08-2017
OPEC is Driving Oil Prices Up, ahead of meeting end November
Bloomberg - Christopher Sell
OPEC’s finally getting some credibility back behind its swagger, ahead of the oil group’s meeting
later this month in Vienna.
The cartel’s members complied to the tune of 104 percent in October on orders to pull back 1.2
million barrels a day, according to Bloomberg data. Stockpiles are drawing and Brent closed at at
two-year high of $64.27/b on Monday.
So what’s changed?
Some say a rise in geopolitical risk has pushed up prices, but other analysts think there’s a more
permanent shift underway.
"We do not see the latest rise in prices as speculative," said Paul Horsnell, global head of
commodity strategy at Standard Chartered, in a recent note. "We think the move reflects the start
of a widespread re-evalution."
Traders, he said, are rethinking how much oil will be produced and drawn down from stockpiles,
especially in the U.S.
Looking at the U.S. gives several encouraging signs. Stockpiles compared to the five-year
average have continually fallen in 2017. U.S. crude and product inventories, including the SPR,
have fallen by 93.8 million barrels since since January. Latest weekly data from the EIA show that
U.S. crude stockpiles have drawn by a further 2.4 million barrels to 454.9 million barrels. That’s
the seventh consecutive weekly draw.

It isn’t just stockpiles, U.S. shale output growth is tapering off. Permian production has grown
almost 15 percent to 2.43 million barrels a day in September from 2.13 million barrels a day in
January, while the Bakken is relatively unchanged and the Eagle Ford falling to 1.13 million
barrels a day from 1.7 million barrels a day, according to BTU Analytics data.
This slowdown has come even as breakevens in key basins have fallen, with costs in both the
Midland basin and West Eagle Ford declining by around 45% since January 2014, according to
BTU Analytics. And while shale output is likely to get cheaper until mid-2019, according to Ebele
Kemery, head of energy investing at JPMorgan in New York, the "greatest leaps forward in
lowering costs are now behind us," said Michael Poulsen, senior oil risk analyst with Global Risk
Management.

Meanwhile, OPEC compliance with production cuts agreed last year rose by 23 percent month-on-
month to 104 percent in October, according to a Bloomberg survey published on Wednesday.
That’s the second-highest level since the organization began curbing output in January. OPEC
output fell by 180,000 barrels a day to 32.59 million barrels a day, Bloomberg data show.
While prices are a bit better now, the coming years don’t look so great. OPEC is probably going to
need to sustain its cuts for another year. Even if the cuts finish in late 2018, it’s looking at zero
growth in demand for its crude until 2025 as shale takes all the new market share.
OPEC’s World Oil Outlook 2017, published today, gives further encouragement. OPEC expects
shale oil production to peak after 2025 and decline from about 2030. OPEC will then be required
to increase its own output from about 33 million barrels a day in 2025 to 41.4 million in 2040,
according to the report.
OPEC Says U.S. Shale Will Grow Faster
OPEC said shale oil production will grow considerably faster than expected over the next four
years after the group’s output cuts triggered a crude-price recovery that helped U.S. producers.

North American shale output will soar to 7.5 million barrels a day in 2021, the Organization of
Petroleum Exporting Countries said in its World Oil Outlook report on Tuesday. That’s 56 percent
higher than it forecast a year ago. The revised outlook illustrates OPEC’s dilemma: with supply
curbs also helping its rivals, demand for the group’s crude will remain little changed until shale oil
output peaks after 2025.
U.S. shale oil “most strikingly” exceeds previous expectations after showing the “resilience and
ability to bounce back,” OPEC said. “This growth is heavily front-loaded, as drillers seek out and
aggressively produce barrels from sweet spots in the Permian and other basins.”
OPEC assumes shale oil production growth will mostly originate from the U.S., with some
contribution from Canada, Argentina and Russia over the forecast period to 2022. North American
shale production for 2017 is now seen at 5.1 million barrels a day, up by almost a quarter from last
year’s World Oil Outlook report.
OPEC and its partners, including Russia, are meeting in Vienna on Nov. 30 to decide whether to
extend the deal to curb production beyond the end of March. Since Jan. 1, they’ve targeted output
cuts of about 1.8 million barrels a day in a bid to reduce global stockpiles.

Brent crude has rebounded more than 10 percent this year, trading at more than $62 a barrel in
London.
OPEC expects shale oil production to peak after 2025 and decline from about 2030. OPEC will
then be required to increase its own output from about 33 million barrels a day in 2025 to 41.4
million in 2040, according to the report.
OPEC raised its forecast for global oil demand by 2.3 million barrels a day in 2021 compared with
last year’s report. The group said demand growth will be particularly robust in 2020 as regulations
to reduce shipping pollution kick in, leading to higher refinery runs to provide the required fuels.
OPEC also raised its oil demand forecast in 2040 by 1.7 million barrels a day to about 111 million
barrels. China and India will lead the demand growth, offsetting declines in developed nations, it
said.
OPEC Sees Oil demand will Peak in Late 2030s If Electric Cars Boom
A larger-than-expected boom in electric vehicle sales could cause global oil demand to peak and
flatten out in the late 2030s, OPEC said.
If a quarter of the world’s cars have batteries, global oil demand would reach a plateau of about
109 million barrels a day during the second half of the 2030s, the Organization of Petroleum
Exporting Countries said in its annual World Oil Outlook.

The group’s main forecast is still for consumption to increase for decades to come as the electric
car fleet expands at half that pace. Yet the inclusion of the faster-growth scenario shows they are
starting to take the threat more seriously.
“It is highly unlikely that electric vehicles will penetrate the passenger car segment with this
strength in less than 24 years,” according to the report published on Tuesday. “Nevertheless,
several countries have publicly stated their intention to achieve an even higher share of electric
vehicles in new sales.”
After France, the U.K. and potentially China announced plans to ban the sale of fossil-fuel burning
cars in the coming decades, oil producers are paying increasing attention to the impact on long-
term growth in oil demand.
So far, there is little agreement over the scale of the threat. The International Energy Agency sees
about 8 percent of the global light vehicle fleet running on batteries by 2040 with little impact on oil
use, while Bloomberg New Energy Finance forecasts that a third of cars on the road will be
electric.
OPEC’s report also raised the possibility that mass adoption of car-sharing services such as those
offered by Uber Technologies Inc. could eat away at oil demand as private car ownership falls.
In China, rapid growth of sharing services could shrink the car fleet and cause oil demand from
cars to peak in 2035 and then fall marginally over the next five years. That would mean oil use
from the car fleet would be 11 percent lower than OPEC’s base case, which sees more modest
growth in sharing and no peak in Chinese demand.
In developed countries on the American continent, wide adoption of car sharing and ride-hailing
technology would accelerate the decline in oil demand, resulting in a 7 percent drop to 6.3 million
barrels a day by 2040, according to the report.

NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
The Editor :”Khaled Al Awadi” Your partner in Energy Services
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Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
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Mobile: +97150-4822502
khdmohd@hawkenergy.net
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Khaled Al Awadi is a UAE National with a total of 27 years of experience in
the Oil & Gas sector. 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 a UAE
operations base , Most of the experience were spent as the Gas Operations
Manager in Emarat , responsible for Emarat Gas Pipeline Network Facility &
gas compressor stations . Through the years, he has developed great
experiences in the designing & constructing of gas pipelines, gas metering &
regulating stations and in the engineering of supply routes. Many years were spent drafting, &
compiling gas transportation, operation & maintenance agreements along with many MOUs for the
local authorities. He has become a reference for many of the Oil & Gas Conferences held in the
UAE and Energy program broadcasted internationally, via GCC leading satellite Channels.
NewBase : For discussion or further details on the news above you may contact us on +971504822502 , Dubai , UAE
NewBase November 2017 K. Al Awadi

Gas Stations Must Adapt to Electric Cars

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