New base 1049 special 06 july 2017 energy news

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 July 06 - 2017 - Issue No. 1049 Senior Editor Eng. Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oman: Key agreement signed to develop Ras Markaz
crude oil storage terminal
By Times News Service ( images bt NewBas )
The Special Economic Zone Authority at Duqm (Sezad) has granted Oman Tank Terminal
Company (OTTCO) a usufruct right to construct Ras Markaz crude oil storage terminal. OTTCO is
one of Oman Oil Company’s subsidiaries, the investment arm for the Sultanate of Oman in the
field of oil and gas industry.
The agreement was executed on behalf of Sezad by Yahia bin Said bin Abdullah Al Jabri in his
capacity as the chairman of the board and on behalf of Oman Tank Terminal Company by Eng.
Isam bin Saud Al Zadjali, CEO of Oman Oil Company and Said bin Hamoud Al Maawali as the
director of OTTCO
The establishment of Ras Markaz crude oil storage terminal falls under the Sultanate's promising
plan for economic diversification and maintaining a crude oil storage terminal for Oman and as an

endeavour to make Oman become an international centre for the storage of crude oil and its
derivatives leveraging its geographic location alongside the Indian Ocean.
Moreover, the newly established terminal will help Oman find an additional port for the export of
crude oil.
Ras Markaz is located 70-km south of Al Duqm Centre and the total area allocated for the storage
terminal is 1,253 hectares which is deemed convenient for high storage capacities.
The agreement grants OTTCO exclusive rights to develop the storage of crude oil and its
derivatives in Ras Markaz area for a period of 20 years and for five years in Sezad as a whole
provided that no other company will be permitted to establish or carry on any similar activity.
Five Year Development Plan
The agreement which will last for 40 years stipulates upon the development of Ras Markaz area
under a five year plan which will cover the establishment and construction of tanks for the storage
of crude oil and its derivatives, establishment of floating platforms and piers for the import and
export of crude oil and its derivatives, pier for the tug boats under water pipelines to receive and
export oil with lengths ranging from 5km to 7k. The plan will cover also the establishment of a
plant for pumping oil to the tanks.
The project will include laboratories, control rooms, administrative offices for the company in
addition to the other safety and securities facilities. The new terminal will be designed in a manner
to allow for blending, loading and unloading the ships at reasonable times the matter that help the
clients save the logistic costs deeming it as a competitive privilege. Moreover, the geographic
advantages for Ras Markaz location will provide and maintain a free access to the newly
established terminal with an operational capacity around 99 per cent.
Storage capacity
According to the agreement, the storage capacity for the newly established terminal during Phase
I will amount to 26 million barrels and it will be executed along a period of 10 years commencing
as of the date of contract signature, and the company will gradually increase its capacity as per
the growth of the demand.
Volume of investments for Phase I:
According to the agreement, OTTCO will be committed to develop all five phases either personally
or via investment consortium or by means of soliciting and utilisation of third parties' investments.
Total investment during Phase I is expected to reach $1.756 billion inclusive of $815 million
invested to cover the costs for the crude oil tanks and $941 million covering the costs for the
construction of the marine and other infrastructure facilities.
Phase I will cover the construction of crude oil storage tanks with capacity of 26 million barrels.
Moreover, during phase I, OTTCO will execute marine facilities for importing and exporting crude
oil with a handling capacity of 100 barrel per hour during this phase of the project apart from the
onshore pumping plant and the basic internal infrastructure within the boundaries of the area.

Egypt and Morocco SDX Energy provides operations update
Source: SDX Energy
SDX Energy, the North Africa focused oil and gas company, has provided an update on its
operations in Egypt and Morocco.
Egypt
South Disouq (55% Operated working interest)
Following the successful drilling of the SD-1X exploration well and resulting natural gas discovery
at South Disouq, a Resources Update was prepared on behalf of SDX by Gaffney, Cline &
Associates (GCA), an independent global oil & gas consultancy. The Company is pleased to
announce the initial results shown below using Canadian NI-51-101 Reporting designations:
Gross Contingent Resources (2C): 47.13 Gas BCF / 2.29 Condensate MMbbl
Gross Prospective Resources (Best Case): 180.08 Gas BCF / 8.73 Condensate MMbbl
The GCA Resources Update for South Disouq is an important step in the validation of SDX’s
understanding of the full potential of the field. The results are in line with management’s
expectations.
The Company also believes that the Gross Prospective Resources as reported above have now
been significantly de-risked as a result of the SD-1X discovery, which was disclosed in its May 29,
2017 news release.

SDX believes that the understanding of the potential reserves and resources for South Disouq will
continue to evolve over time as more data becomes available and further exploration activities are
undertaken.
The SD-1X discovery and its subsequent development allows SDX to begin unlocking the
resource potential that it believes is contained within the South Disouq concession. Furthermore,
given the encouraging results noted in the deeper oil prone Cretaceous horizon encountered in
SD1X, where a working petroleum system was encountered, the Company is planning to further
test this horizon during the development program planned for the SD-1X discovery.
SDX is also pleased to announce that it is currently in constructive discussions with the Egyptian
authorities, regarding bringing the field into production by way of an early production system
(EPS).
The initial development at SD-1X will see the field being connected to the nearby Egyptian
domestic gas distribution system allowing for both early cash flow and for subsequent wells and
discoveries to be connected in short order.
The existing gas infrastructure within the concession area combined with the cooperative and
supportive efforts of Egyptian authorities will allow SDX to bring this discovery into production in
the shortest possible time frame.
North West Gemsa (50% working interest)
At North West Gemsa the workover program is set to commence in July. This program will be
focused on ESP installation and maintenance of both production and water injection wells,
working towards ensuring that the field target rate of 5,000 boepd is maintained throughout the
year. This follows the recent technical review at North West Gemsa to determine how best to
extend the economic field life through optimising field operations whilst continuing to focus on
operating cost reductions.
Meseda (50% working interest)
At Meseda the fluid treating facility upgrade has now been completed. This involved the
installation of a new two- phase separator, which has doubled the gross treating capacity in the
field.
Additionally, a tender exercise has been undertaken to select the preferred Electrical Submersible
Pump (“ESPs”) vendor to supply the pumps for the remaining workovers in Meseda. The fluid
treating facility completion allows the workover campaign to resume with the resulting uplift in
production envisaged in the coming months.
Morocco (75% working interest)
Significant progress continues to be made in preparing for the forthcoming drilling campaigns at
both Sebou and Lalla Mimouna, which remain on track to commence in September of this year.
The campaign will include the drilling of seven wells, two of which will be exploration wells and the
remaining five being development wells.
To that end, SDX has concluded its tendering exercise and selected XCD to provide a rig for this
program. XCD has previously drilled in Morocco and is very familiar with the area. The
mobilisation will begin within the next six weeks.

In addition, SDX has now secured all the long lead items necessary for the drilling campaign,
locally at very competitive prices, from an operator that was exiting the country. Finally,
construction has now commenced on the seven identified locations, as well as several back-up
locations, ensuring that upon arrival of the drilling rig there should be no delay in start-up.
Paul Welch, CEO of SDX, commented:
'The first half of 2017 has seen an unprecedented level of activity for SDX and today’s
announcement shows that material progress continues to be made across the current portfolio.
We are extremely upbeat on South Disouq and are pleased to be able to update the market with
news of the initiation of discussions on the early production scheme, as well as the completion of
the work on the CPR.
The accumulation of additional production data, combined with development drilling and additional
exploration activity, will enable further independent assessment of the field’s reserves and
resources to be completed resulting in an additional increase in its value.
'We continue to progress our existing portfolio as aggressively as possible, whilst continuing to
review opportunities for additional value accretive growth from new opportunities.
With our existing team, predominantly based in North Africa; we have the internal resource and
strong desire to maintain the momentum over the coming months. In addition, during Q3 we
intend to update our shareholders on a start-up date for our EPS system in South Disouq.'

Morocco: Sound Energy, successful Koba-1 well test at Sidi Moktar
Source: Sound Energy
Sound Energy, the Moroccan and European focused upstream gas company, has reported the
success of operations to date at the Koba-1 well at Sidi Moktar, onshore Morocco.
The Company has successfully re-entered, completed, perforated and flared gas at surface from
the Argovian reservoir (historically the main producing reservoir in the Kechoula discovery).
A five metre interval was perforated in the Argovian reservoir at a measured depth of 1406 metres
where the static pressure was measured at 98 bar, confirming a producible gas accumulation. The
Company has now temporarily suspended the well in preparation for a rigless extended well test -
after which the Company hopes to move rapidly to production. The Koba-1 well, drilled at the
crest of the Kechoula discovery, is close to existing infrastructure and gas demand, including the
large scale Moroccan state owned OCP Phosphate plant.
The Company believes the Sidi Moktar licences also contain significant pre-salt potential and
notes the quantitive assesment prepared by a previous operator in 1998 which referred to
exploration potential of the Sidi Moktar licences of up to 9 Tcf unrisked gas originally in place
(gross) in the TAGI and Paleozoic. The Company will require the reprocessing of existing 2D
seismic, acquisition of new 2D seismic and drilling results before forming its own volume
estimates for the exploration potential of the Sidi Moktar licences.
The Company also advises that due to poor quality cement bonding across the Lower Liassic in
the Koba-1, and likely the Kamar-1, wells, the Company no longer intends to immediately re-enter
the Kamar-1 well (subject to agreement with the regulatory authorities). The Lower Liassic at
Kechoula will therefore be evaluated at a later date together with the deeper pre-salt.
As a result, the rig will be immediately released from Sidi Moktar and will likely return to the
Company's licences in Eastern Morocco.

U.S. proposes cutting total biofuels requirements in 2018
REUTERS/Aaron P. Bernstein
The U.S. government on Wednesday proposed to reduce the volume of biofuel required to be
used in gasoline and diesel fuel next year as it signaled the first step toward a potential broader
overhaul of its biofuels program.
The U.S. Environmental Protection Agency's proposed total volume marked a slight decline from
current levels and was more than 20 percent below targets
laid out in a 2007 law. The U.S. Renewable Fuel Standard,
or RFS, requires increased volumes of renewable fuels
each year, but the proposal would keep targets for use of
conventional biofuels at current levels.
The agency has begun preparations to reset future biofuel
targets, said EPA Administrator Scott Pruitt. His proposal
was met with praise and calls for broader reform from the
petroleum industry and mixed response from biofuels
producers.
Environmentalists, who have been critical of ethanol, called for Congress to reform the program.
The RFS has become a battlefield between corn and oil interests. The law has been a boon to
agriculture, supporting economies across the Midwest's Corn Belt.
The EPA's proposed cuts to advanced and cellulosic biofuels "will have a chilling effect on the
push toward next generation biofuels," said Iowa Senator Chuck Grassley.
Petroleum companies say the biofuel targets are impossible to meet and add billions of dollars in
costs. The plan would require companies to blend a total of 19.24 billion gallons of renewable
fuels in the country's fuel supply next year.
The proposal is "consistent with market realities focused on actual production and consumer
demand while being cognizant of the challenges that exist in bringing advanced biofuels into the
marketplace," Pruitt said in a statement.
The agency would keep the 2018 target for conventional ethanol at 15 billion gallons, unchanged
from 2017, and set the requirement for advanced biofuels, including cellulosic ethanol, at 4.24
billion gallons.
These latest volumes confirmed an earlier Reuters report for volumes well below the 26 billion
gallons of renewable fuels outlined by Congress in 2007. The law was aimed at cutting U.S. oil
imports and boosting the use of renewable fuels.
The EPA also requested comments related to concerns that the biofuels requirements
increasingly are being met by supplies from Brazil, Argentina and Indonesia.
The agency proposed setting the requirements for cellulosic below the current year's levels at 238
million gallons and kept biomass-based diesel requirements at 2.1 billion gallons for 2019,
unchanged from the levels set for 2018 under former President Barack Obama.
Development of cellulosic biofuels has been slower than expected by lawmakers when they set up
the program, stymied by regulatory delays and the economic downturn.

The American Petroleum Institute, which represents oil companies, including BP America and
Chevron Corp, praised the move to lower the overall requirements but said the proposal did not go
far enough.
Ethanol groups praised the agency for maintaining the target for conventional ethanol, which is
mostly produced from corn in the United States, but were critical of the move to lower the
advanced targets.
"We are concerned that by reducing the cellulosic (requirement), this proposal may weaken the
signal to the marketplace," said Bob Dinneen, head of the Renewable Fuels Association.
“Today’s proposal underscores the need for the U.S. Congress to take the bull by the horns and
reform the Renewable Fuel Standard to protect our clean water, our public health, and our
wildlife," said National Wildlife Federation President and CEO Collin O’Mara.
Prices of U.S. renewable fuel credits rose 4 cents to trade at 75 cents apiece. Biodiesel credits
were up 3 cents at $1.145 each, traders said.

NewBase 06 July 2017 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Oil prices edge up on US crude stock draw, but market remains weak
Reuters + NewBase
Oil prices nudged higher early on Thursday, supported by strong demand in the United States, but
analysts cautioned that the outlook was for lower prices due to oversupply.
Brent crude futures, the international benchmark for oil prices, rose 28 cents, or 0.6 percent, to
$48.07 per barrel by 0132 GMT. U.S. West Texas Intermediate (WTI) crude futures were at
$45.39 per barrel, up 26 cents, or 0.6 percent.
Traders said the gains reflected firm fuel demand in the United States, where data from the
American Petroleum Institute (API) late on Wednesday showed that U.S. crude inventories fell by
5.8 million barrels in the week to June 30 to 503.7 million.
Crude prices tumbled about 4 percent on Wednesday on rising exports by the Organization of the
Petroleum Exporting Countries (OPEC), despite its pledge to hold back production between
January this year and March 2018 to prop up prices.
OPEC's oil exports rose for the second month in a row in June, according to Thomson Reuters Oil
Research. OPEC exported 25.92 million barrels per day (bpd) in June, 450,000 bpd above May
and 1.9 million bpd more than a year earlier.
Energy research house and brokerage firm Sanford C. Bernstein said it was reducing its average
Brent crude oil price forecasts for 2017 and 2018 to $50 per barrel each, down from $60 and $70
previously.
Oil price special
coverage

Bernstein said that the reduction was a result of an expected increase in U.S. shale oil output,
especially from the Permian field. "Permian supply pummels our near term estimates," Bernstein
said, adding that conventional supply additions would likely exceed or match production declines
of mature fields.
Denmark's Saxo Bank said that oil prices could rise towards $55 per barrel in the coming months,
but said it expected lower prices towards the end of the year and into 2018.
"The price of Brent crude oil is likely to rally back towards $55 per barrel during the coming
months before renewed weakness sets in as the focus turns to 2018 and the potential risk of
additional barrels hitting the market if OPEC and Russia fail to extend the production cut deal
beyond Q1 2018," Ole Hansen, Head of Commodity Strategy at Saxo Bank, said in a quarterly
market outlook.
Forecast
Crude oil prices are getting a slight boost early Thursday in reaction to a report from the American
Petroleum Institute (API) that showed a bigger-than-expected draw from inventory.
According to the API, inventories fell by 5.764 million barrels the week-ended June 30. Analysts
were looking for a read of 2.83 million barrels.
Gasoline inventories also showed a draw during the same time period. Inventories fell by 5.7
million barrels. Analysts were expecting a 500,000 barrel draw.
There wasn’t much reaction to the API news which means investors are waiting for the EIA’s
weekly inventories report, due to be released at 1500 GMT on Thursday. It is expected to show a
draw of 2.4 million barrels.
Investors will be particularly interested in U.S. daily production since a drop in this figure the
previous week underpinned the crude oil market during its recent 9 day rally. Another drop in daily
production could trigger a short-covering rally.
Traders are going to have to determine if a drop in U.S. production outweighs the increase in
OPEC production. If they feel that the U.S. data carries more weight, then crude oil will rally. If
daily production rises then look for crude oil prices to retreat.
The key area to watch on the WTI chart is $44.69 to $44.06. Bullish investors may try to form a
secondary higher bottom after a successful test of this zone. Bearish investors are going to try to
take out this zone in an effort to make $47.32 a new secondary lower top.
Oil Pares Losses as U.S. Crude, Gasoline Supplies Said to Shrink
Oil pared losses after an industry group was said to report big declines in U.S. crude and gasoline
stockpiles that have remained stubbornly high during this summer driving season.
The day’s news reflected the ongoing debate over whether prices are more reflective of actions
undertaken in U.S. shale fields, or by an OPEC-led push to balance the market with production
cuts elsewhere.

Futures fell as much as 5.4 percent on Wednesday, as Russia was said to oppose any proposal to
deepen the output cuts. Prices recovered somewhat on American Petroleum Institute estimates
said to show crude inventories fell by 5.8 million barrels last week and gasoline supplies dropped
by 5.7 million. West Texas Intermediate for August delivery settled $1.94 lower.
“Any opposition to deeper output cuts supports the doubters of the effectiveness of the supply
deal, fueling bearish oil-market sentiment,” said Norbert Ruecker, head of commodities research
at Julius Baer Group Ltd. in Zurich.
While crude prices surged last week, futures are down about 15 percent for the year amid
concerns that rising global supply will offset the output cuts from the Organization of Petroleum
Exporting Countries and its partners. Libya and Nigeria, which are exempt from the agreement,
accounted for half of the group’s production boost last month, according to data compiled by
Bloomberg.
West Texas Intermediate for August delivery settled $1.94 lower at $45.13 a barrel on the New
York Mercantile Exchange. Futures reached $45.65 at 4:57 p.m. after API data was released.
Tuesday’s transactions were booked Wednesday for settlement purposes because of the U.S.
Independence Day holiday. Prices gained almost 11 percent in the eight days through Monday.
Brent for September settlement closed at $47.79 a barrel on the London-based ICE Futures
Europe exchange, down $1.82. The global benchmark touched $48.32 after the API report.

NewBase Special Coverage
News Agencies News Release 06 July 2017
Construction costs for most power plant types have fallen in
recent years .. Source: U.S. Energy Information Administration, Form EIA-860, Electric Generator Construction Costs
Based on EIA survey data for new, utility-scale electric generators (those with a capacity greater
than one megawatt), capacity-weighted average construction costs for many generator types have
fallen in recent years. Annual changes in construction costs include the effects of differences in
the geographic distribution of installed capacity between years, differences in technology types,
and other changes in capital and financing costs.
EIA began collecting data on construction costs for new utility-scale generators installed in 2013.
The data for each year reflect projects completed in that year. Because power plants are often
constructed over several years, reported costs are not necessarily indicative of the cost of a
project initiated in that year. Government grants, tax benefits, and other incentives are excluded
from these costs.

Construction costs alone do not determine the economic attractiveness of a generation
technology. Other factors such as fuel costs (for generators that consume fuel), utilization rates,
financial incentives, and state policies also affect project economics and, in turn, the kinds of
power plants that are built.
In 2015, wind, natural gas, and solar were the most commonly added capacity types, adding 8.1
gigawatts (GW), 6.5 GW, and 3.2 GW, respectively. In the case of wind and solar, almost all of
these additions (98% and 91%, respectively) were at new plants, as opposed to new generators at
existing plants.
For natural gas, about 60% of the capacity added in 2015 was new generators at new plants, and
the remaining 40% were new generators at existing plants. For other fuels such as hydro and
petroleum liquids, which had relatively little capacity added in 2015, almost all of those additions
were located at existing plants. Construction costs for battery storage units are available for the
first time in 2015.
The capacity-weighted cost of installing wind turbines was $1,661 per kilowatt (kW) in 2015, a
12% decrease from 2013. Costs tend to be lower for larger wind plants, as plants above 100
megawatts (MW) averaged lower costs than those below 100 MW, likely reflecting economies of
scale.

Source: U.S. Energy Information Administration, Form EIA-860, Electric Generator Construction Costs
The average cost of natural gas generators installed in 2015 was $696/kW, a 28% decline from
2013. Nearly 75% of the natural gas capacity installed in 2015 were combined-cycle units, which
had an average installed cost of $614/kW.
Combined-cycle natural gas plants include at least one combustion turbine and one steam turbine
and are generally more efficient than plants with combustion turbines alone. About 1.5 GW of
natural gas plants with only combustion turbines were installed in 2015, at an average cost of
$779/kW. Natural gas plants with internal combustion engines were more expensive, averaging
$1,798/kW for the 0.2 GW installed in 2015.

The cost of utility-scale solar photovoltaic generators declined 21% between 2013 and 2015, from
$3,705/kW to $2,921/kW. More than half of the utility-scale solar photovoltaic systems installed in
the United States track the sun through the day, and in general, those systems cost slightly more
than those installed at fixed angles.
Construction costs differed slightly by technology type, with crystalline silicon systems (73% of the
2015 installed solar photovoltaic capacity) costing slightly less than systems with thin-film panels
made using cadmium telluride.
Source: U.S. Energy Information Administration, Form EIA-860, Electric Generator Construction
Costs
More information is available in EIA’s construction costs data, which is based on data collected
through EIA’s Annual Electric Generator Report (EIA-860). Construction costs for generators
installed in 2016 are expected to be available in January 2018.

NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
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Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
Mobile: +97150-4822502
khdmohd@hawkenergy.net
khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with a total of 25 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 July 2017 K. Al Awadi

New base 1049 special 06 july 2017 energy news

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