New base 17 july 2021 energy news issue 1443 by khaled al awadi

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NewBase Energy News 17 July 2021 - Issue No. 1443 Senior Editor Eng. Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
U.A.E: ADNOC invests over US$750 million in drilling-related
services to support production capacity growth
WAM/Rola Alghoul/MOHD AAMIR
The Abu Dhabi National Oil Company (ADNOC), today announced an investment of US$763.7
million (AED2.8 billion) in integrated rigless services across six of its artificial islands in the Upper
Zakum and Satah Al Razboot (SARB) fields to support its production capacity expansion to 5 million
barrels per day (mmbpd) by 2030.
The investment is in the form of three contracts awarded by ADNOC Offshore to Schlumberger,
ADNOC Drilling, and Halliburton after a competitive tender process.
Schlumberger’s share of the award is valued at US$381.18 million (AED1.4 billion); ADNOC
Drilling’s share is valued at US$228.71 million (AED839.58 million), and Halliburton’s share is
valued at US$153.87 million (AED564.85 million).

Over 80 percent of the total award value will flow back into the UAE's economy under ADNOC’s In-
Country Value (ICV) programme over the 5-year duration of the contracts, reinforcing ADNOC’s
commitment to ensuring more economic value remains in the country from the contracts it awards.
Yaser Saeed Almazrouei, ADNOC Upstream Executive Director, said, "These important awards for
integrated rigless services will drive efficiencies of drilling and related services, and optimise costs
in our Offshore operations as we ramp up our drilling activities to increase our production capacity
and enable gas self-sufficiency for the UAE.
"The contractors bring best-in-class expertise and technologies with a proven track record in the
industry and ADNOC Drilling’s scope reflects its expanded service profile following its successful
transformation into a fully integrated drilling services (IDS) company, enabling it to offer its clients
start-to-finish well drilling and construction services. Importantly, the high In-Country Value
generated from the awards will stimulate new business opportunities for the private sector and
support the UAE’s post-Covid economic growth."
The scope of the contracts includes coiled tubing services with thru-tubing downhole tools,
stimulation services, including equipment and chemicals/fluid systems, surface well testing services,
wireline, and production logging services and tools, saturation monitoring, and well integrity.
Previously, ADNOC Offshore’s rigless services were provided through several discrete service-
specific contracts. Unifying the scope through integrated service contracts, underpins ADNOC’s
smart approach to procurement and provides ADNOC Offshore with operational flexibility while
enabling cost efficiencies and single point responsibility by the contractors.
Ahmad Saqer Al-Suwaidi, CEO of ADNOC Offshore, said, "These contracts are an important
contributor to ADNOC Offshore’s plans to build our production capacity to over 2 million barrels a
day in the coming years to support the ADNOC Group’s smart growth strategy. The award follows
a highly competitive bid process, which included a rigorous assessment of how much of the contract
value would support the growth and diversification of the UAE’s economy through ADNOC’s In-
Country Value Programme."
The six artificial islands covered by the awards are Asseifiya, Ettouk, Al Ghallan, and Umm Al Anbar
in the Upper Zakum field and Al Qatia and Bu Sikeen in the SARB field.
Artificial islands provide significant cost and environmental benefits, particularly in shallow water, by
enabling the use of lower-cost land-drilling rigs instead of higher-cost offshore jack-up drilling rigs.
ADNOC has a proven record of developing artificial islands and drilling the Middle-East’s longest
wells, as part of its continued commitment to protecting the UAE’s marine environment while
enabling greater operational efficiencies and safety.
ADNOC Drilling’s transformation into a fully integrated drilling services provider followed the award
to Baker Hughes of a 5 percent share in the company, which is now capable of delivering start-to-
finish drilling and well-construction services onshore and offshore with proven efficiency gains. As
of May 2021, ADNOC Drilling has delivered over 180 IDS wells since 2018, achieving an efficiency
improvement of close to 50 percent, which resulted in over US$210 million (AED767 million)
savings.
As an integral part of its 2030 strategy, ADNOC is optimising its procurement strategy to reflect
market dynamics, focusing on long-term contracts with a reduced number of suppliers that provide
stable and reliable delivery at highly competitive rates. This smart approach is enabling ADNOC to
create more value, drive efficiencies, and ensure that strategic materials and components are
available on time while achieving substantial efficiency gains as it increases overall procurement
spend.

Adnoc joins international hydrogen council
ADNOC + Gulf New
Abu Dhabi National Oil Company (Adnoc) has joined Hydrogen Council – an international
organisation that aims to accelerate the global position of hydrogen through its member companies.
Hydrogen and its carrier fuels have great potential as new, low carbon fuels, which Adnoc and the
UAE are well placed to capitalise upon.
The Council, which was launched in 2017, has
already grown to include some of the world’s
largest, global companies, particularly in the
energy and transportation sectors. According to
the organization, hydrogen is expected to account
for as much as 18% of global energy demand by
2050, with over 30 countries having released
hydrogen roadmaps and more than 228 large-
scale projects underway along the value chain.
Dr Sultan Ahmed Al Jaber, UAE Minister of
Industry and Advanced Technology and
Managing Director and Group CEO of Adnoc said:
“Energy demand continues to increase as global
populations expand and economic development
accelerates. With an energy transition taking
place, this means that more energy is needed with
fewer emissions.
“Adnoc is an early pioneer in the emerging market for hydrogen and its carrier fuels, such as blue
ammonia, driving the UAE’s leadership in creating international hydrogen value chains and a local
hydrogen eco-system. We are pleased to join the Hydrogen Council and look forward to working
with its members and the secretariat to advance the use of hydrogen as a low carbon energy source”
Adnoc’s competitive blue hydrogen production is enabled by its abundant and low-cost
hydrocarbons, existing large-scale hydrogen and ammonia production facilities, and its regional
leadership in large carbon capture and storage capacities. Its Al Reyadah plant was the first
commercial-scale carbon capture facility in the Middle East and the world’s first commercial facility
to capture CO2 from the iron and steel industry.
Adnoc plans to leverage its existing hydrogen production, infrastructure and partnership base and
vast reserves of natural gas to lead Abu Dhabi and the UAE’s hydrogen activities with the aim to
become one of the lowest cost and largest producers of blue hydrogen in the world.
In June, Adnoc announced that Fertiglobe joined as partner to advance a world-scale blue ammonia
production facility at the TA’ZIZ industrial ecosystem in Ruwais, Abu Dhabi. The final investment
decision is expected in 2022, and start-up is targeted for 2025 for the project. The facility’s capacity
will be 1,000 kilotons per annum.
Adnoc is also working with the UAE Ministry of Energy and Infrastructure, Mubadala Investment
Company (Mubadala) and ADQ in the Abu Dhabi Hydrogen Alliance (the Alliance). The Alliance
partners will collaborate to establish Abu Dhabi as a trusted leader of low-carbon green and blue
hydrogen in emerging international markets. –

Iraq: ShaMaran acquires TotalEnergies interest in the Sarsang
Source: ShaMaran
ShaMaran Petroleum has signed an agreement with a subsidiary of TotalEnergies to acquire its
affiliate (TEPKRI Sarsang) holding an 18% non-operated participating interest in the Sarsang
Production Sharing Contract in the Kurdistan Region of Iraq for an initial consideration of USD 155
million plus working capital adjustments amounting to USD 14.2 million as of January 1, 2021.
An additional contingent consideration of USD 15 million is payable in the future as more fully
described below. The Acquisition is transformative to ShaMaran’s production, reserves and
financial profile and delivers on the Company’s focused and disciplined strategy for growth by
targeting this opportunity that is accretive to the Company, its shareholders and its bondholders.
HIGHLIGHTS
The Acquisition:
 Adds immediate incremental participating interest production of approximately 5,000 bopd of
light crude oil;
 Is expected to double ShaMaran’s Q2 2021 average net production of 11,090 bopd following
the completion of the processing facility expansion at Swara Tika field by mid-2022;
 Enhances ShaMaran’s oil reserves through the addition of high API and low sulphur oil that
achieves a low discount to Brent; and
 Provides a low cost structure with life-of-field operating expenditure anticipated to be
approximately USD 5.60/boe.
The Sarsang block is on the northern border of the Company’s Atrush block and is comprised of
two producing fields: Swara Tika and East Swara Tika. At Swara Tika, an expansion project is well

underway with the addition of a new 25,000 bpd processing facility which is expected to lift gross
production to approximately 50,000 bopd by mid-2022. Through the Acquisition, ShaMaran will add
strong cash flow and a production growth trajectory underpinned by its interests in two cash-positive
PSCs with three producing fields in the same vicinity.
Following a successful closing of the Acquisition, the Company’s Q2 2021 average net production
of 11,090 bopd is expected to double in second half of 2022 after the facility expansion at Swara
Tika is completed.
Additionally, the Sarsang crude is of high quality and enjoys one of the lowest price discounts to
Brent in Kurdistan. In connection with the new facility being commissioned by mid-2022, the Sarsang
block will also be connected to the Atrush feeder pipeline for future pipeline export and will thereby
have a permanent pipeline connection to the export market.
The Acquisition is highly accretive and transformative to ShaMaran as it grows from a single asset
company to a multi-field producer and paves the way for future growth opportunities for ShaMaran.
ShaMaran’s President and Chief Executive, Dr. Adel Chaouch, said:
'We are delighted that we have agreed the acquisition of the TotalEnergies’ non-operating interest
in Sarsang, a high-quality producing asset with strong operational and financial fit to ShaMaran’s
business. This is a strategic transaction for ShaMaran delivering value to equity and debt holders
and strengthening the financial profile of the Company. Upon completion, this acquisition will add
immediate material production and cash flow to ShaMaran and will provide significant value
enhancement. It demonstrates our continued commitment to Kurdistan and diversifies our existing
production base.
Sarsang has an attractive discovered reserves base with a strong track record of safety and
sustained production. As a neighboring field to the Atrush field, becoming a partner in the Sarsang
field presents opportunities for potential integration synergies with Atrush operations.
We would like to thank TotalEnergies for their commitment in the negotiations of this acquisition and
look forward to a constructive partnership in the future with the Sarsang operator, as well as a
continued and trusted relationship with the Kurdistan Regional Government of Iraq.'
TRANSACTION DETAILS
ShaMaran has agreed to acquire 100% of the shares of TEPKRI Sarsang, a subsidiary of
TotalEnergies, which holds an 18% non-operated participating interest in the Sarsang PSC. The
Acquisition has an effective date of January 1, 2021.
ShaMaran will pay an initial consideration of USD 155 million upon closing of the Acquisition before
working capital and related adjustments and an additional contingent consideration of USD 15
million in the future, as follows:
The initial consideration of USD 155 million is divided into (i) an upfront cash payment of USD 135
million payable upon closing and (ii) a deferred consideration of USD 20 million structured as a
vendor finance in the form of a 5.5% convertible promissory note issued to a subsidiary of
TotalEnergies with a 12-months’ maturity from the date of closing.
An additional contingent consideration of USD 15 million is payable in the future upon (i) cumulative
gross production from the Sarsang PSC reaching 130 MMbbls and (ii) subject to Brent crude oil
prices averaging at least USD 60/bbl for a twelve months’ period. ShaMaran expects to receive
significant positive cash flow upon closing of the Acquisition based on 2021 cash flows at current
oil prices. The Company intends to finance the Acquisition through the issue of new debt, equity

and by utilizing the Company’s cash balance. The 'change of control' of TEPKRI resulting from the
Acquisition is subject to regulatory and exchange approvals in Canada, the Kurdistan Region and
Sweden.
DEBT FINANCING
The Company intends to issue an up to USD 300 million new 4-year bond to refinance existing debt
and raise new capital for the Acquisition. Subject to the closing of the Acquisition, USD 175 million
of the currently outstanding USD 180 million ShaMaran 2023 bond (after the USD 5 million
repayment due in late 2021) will exchange at 102% of par into the proposed new bond at par value.
In aggregate, USD 185.7 million (including the USD 7.2 million amount described below) will be
issued to refinance the existing debt into the new bond upon closing of the Acquisition and up to
USD 114.3 million will be issued for cash to finance the Acquisition and other general corporate
purposes.
Cash proceeds from the new bond will be placed in an escrow account and only released upon
satisfaction of the closing conditions to the Acquisition. The existing debt that is proposed to be
refinanced into the new bond includes USD 7.2 million of the total USD 22.8 million debt currently
owed by the Company to Nemesia S.à.r.l. (a private company ultimately controlled by a trust the
settlor of which is the Estate of the late Adolf H. Lundin) (“Nemesia”). The USD 15.6 million balance
will remain outstanding as described below.
The Company and its advisors have engaged with a majority of bondholders that prior to the date
of this news release have pre-committed to vote in favour of the conditional refinancing of the
existing bond through a written summons and resolutions, as well as necessary waivers for the
issuance of the new bond and other financial matters relating to the existing bond.
The Company has also obtained strong interest for the contemplated new bond from a group of
existing and new bond investors. Book-building for the contemplated bond will be launched
imminently together with a summons for written resolution to refinance the existing outstanding bond
conditional on closing of the Acquisition.
EQUITY FINANCING
The Company intends to raise USD 30 million of additional equity capital to fund the Acquisition, which the
Lundin family, as ShaMaran’s largest shareholder, has agreed to support by Nemesia providing a USD 30
million equity underwriting.
The new equity is expected to be issued through a rights issue in eligible jurisdictions in connection with the
Acquisition in order to provide all shareholders to whom subscription rights may be lawfully issued with a
proportionately equal opportunity to participate. Further information on the contemplated rights offering will
be announced in due course.
The offering will be conditional on, inter alia, approval of the Acquisition by the TSX Venture Exchange, the
approval of the Kurdistan Regional Government (“KRG”), the filing of a rights offering circular or prospectus
in Canada and in Sweden and other regulatory approvals. It is anticipated that the rights offering would be
commenced as soon as practicable following receipt of KRG approval for the Acquisition.
The Lundin family underwriting will be by way of a stand-by commitment, meeting the requirements of
applicable securities laws, to acquire shares not subscribed for by others pursuant to subscription rights
issued in the offering.
For the Acquisition representing ShaMaran, Pareto Securities AS has been engaged as manager and
bookrunner for the bond and equity financings. Also in connection with the Acquisition for ShaMaran, Moelis
& Company UK LLP is acting as M&A financial advisor and Arkwright London is acting as bond advisor.

Saudi Aramco award Morgan Stanley on gas pipelines deal
Reuters Rania GamalSaeed Azhar + NewBase
DUBAI, July 12 (Reuters) - Saudi Aramco has dropped Morgan Stanley (MS.N) as an adviser for
the sale of its gas pipelines and picked JPMorgan (JPM.N) and Goldman Sachs (GS.N) for the
role, three sources familiar with matter said.
JPMorgan had also advised Aramco on the sale of the oil pipeline business, which was sold to a
consortium led by Washington-DC based EIG Global Energy Partners for $12.4 billion.Aramco has
also invited banks to advise on the financing of the deal, sources told Reuters, the second major
midstream deal after the sale of the oil pipelines.

The gas pipeline deal will also have an element of staple financing arranged by Aramco for the
buyer, similar to the oil pipeline transaction that was backed by $10.5 billion in bank loans, they
said. JPMorgan was also among the lead arrangers for the loan that backed the oil pipeline deal,
they said.
Morgan Stanley, which was among the top advisers for Aramco's $29.4 billion initial public offering
in 2019, had also missed out on the oil pipeline advisory role. It was not immediately clear why
Morgan Stanley was dropped on the gas pipeline deal, sources said.
Aramco, Morgan Stanley, JPMorgan and Goldman Sachs declined to comment.
In recent years, Saudi Arabia has become one of the Middle East’s biggest markets for bankers
keen to grab a slice of business from new listings, as well as merger and acquisition activities.
Goldman also advised Aramco on its IPO and advised the sovereign fund, the Public Investment
Fund, on the sale of its majority stake in Saudi Basic Industries Corp (2010.SE) to Aramco, a deal
that completed last year.
The gas pipeline stake sale will have a similar structure to the oil pipeline deal, sources have told
Reuters earlier. Aramco has used a lease and lease-back agreement to sell a 49% stake of newly
formed Aramco Oil Pipelines Co to the buyer and rights to 25 years of tariff payments for oil carried
on its pipelines.

Qatar Petroleum signs 20-year deal to supply LNG to Korea
QP + NewBase
Qatar Petroleum (QP) has entered into a new, 20-year Sale and Purchase Agreement (SPA) with
Korea Gas Corporation (Kogas) for the supply of two million tons per annum (MTPA) of LNG to the
Republic of Korea.
The agreement was signed today by Saad Sherida Al-Kaabi, the Minister of State for Energy Affairs,
the President and CEO of Qatar Petroleum, and Hee-Bong Chae, the President and CEO of Kogas,
during a special ceremony held at Qatar Petroleum’s headquarters.
Pursuant to the SPA, LNG supplies will commence in January 2025, and will be delivered to Kogas’
LNG receiving terminals in the Republic of Korea. Al-Kaabi said: “We are both proud and delighted
to continue to serve as a major LNG supplier to Kogas and the Republic of Korea.
Today’s agreement is another step in the
historic partnership journey between Qatar
Petroleum and Kogas, which we hope to
take to new heights.” The new agreement
comes almost 26 years following Kogas’
signing of its first ever LNG SPA from Qatar.
Qatar currently supplies Kogas with more
than 9 MTPA through long-term
agreements, making it the largest supplier
of LNG to the Republic of Korea and
demonstrating its strong commitment to
meeting the clean energy requirements of customers around the globe who depend on reliable LNG
deliveries.
“We are grateful to Kogas for being such a great partner and customer, and we welcome this
opportunity to further cement our partnership with Kogas and to support the Republic of Korea’s
national drive toward cleaner and more sustainable energy,” Al-Kaabi added.
Since 1999, Qatar Petroleum’s LNG ventures have delivered more than 2,500 LNG cargoes,
totalling almost 185 million tons, to the Republic of Korea.

Global liquefied natural gas trade was flat in 2020 amid pandemic
Graph by the U.S. EIA, based on data from the International Group of LNG Importers (GIIGNL), The LNG Industry, annual reports (2010–2021)
Global trade in liquefied natural gas (LNG) in 2020 remained essentially unchanged from 2019,
averaging 46.9 billion cubic feet per day (Bcf/d) compared with 46.7 Bcf/d in 2019, according to the
recently released The LNG Industry: GIIGNL Annual Report 2021 by the International Group of
Liquefied Natural Gas Importers (GIIGNL).
This 0.4% annual increase in LNG trade occurred despite the COVID-19 pandemic that reduced
global natural gas demand. Between 2015 and 2019, global LNG trade expanded by 45%, posting
record growth in both 2018 and 2019.
This expansion primarily resulted from liquefaction capacity additions in Australia, the United States,
and Russia, which combined accounted for more than 90% of the global growth in liquefaction
capacity during this period.

In 2020, LNG exports increased from only two countries—the United States by 1.5 Bcf/d and
Australia by 0.3 Bcf/d—compared with 2019.
Last year, the United States commissioned several new liquefaction units (called trains), namely the
third and final trains at Cameron LNG, Freeport LNG, and Corpus Christi LNG export facilities as
well as the remaining trains at the Elba Island LNG export facility.
With the spread of the COVID-19 pandemic and lockdowns in many LNG-consuming countries,
U.S. LNG exports significantly declined in June and July of 2020, but they have gradually increased
in the months that followed and set consecutive all-time highs in November and December 2020.
In 2020, Australia became the world’s largest LNG exporter for the first time, overtaking Qatar, with
exports averaging 10.2 Bcf/d, an increase of 0.3 Bcf/d (3%) compared with 2019. Exports from Qatar
declined by 0.1 Bcf/d (1%) compared with 2019.
Exports from all other countries have either remained flat or declined, amounting to a combined 1.6
Bcf/d decrease compared with 2019.
Among all LNG-importing regions, only Asia had an increase in annual LNG imports, by 1.1 Bcf/d
(3%), in 2020 compared with 2019. China and India drove the overall annual increase. China's LNG
imports increased by 1.0 Bcf/d and India by 0.4 Bcf/d in 2020.
In China, continuous growth in LNG imports mainly resulted from government-supported coal-to-
natural gas switching policies to reduce air pollution. In India, all-time low spot LNG prices in the
spring and summer of 2020 led to more fuel switching and an increase in LNG imports procured on
a spot basis.
LNG imports to Japan continued to decline in 2020, averaging 9.8 Bcf/d, which was 0.3 Bcf/d less
than in 2019. Europe’s LNG imports declined by 5%, averaging 10.7 Bcf/d in 2020, but remained
significantly higher than the 6.1 Bcf/d in 2017 and 6.4 Bcf/d in 2018.

India: Reliance Bids for India’s Solar Incentives in Green Push
Bloomberg - Rajesh Kumar Singh and Debjit Chakraborty
Billionaire Mukesh Ambani’s Reliance Industries Ltd. is considering a bid for Indian government
incentives for solar power manufacturing, as the fossil-fuels giant begins a $10 billion push into
clean energy, according to people familiar with the plans.
Reliance, India’s most valuable company, attended a pre-bid meeting held last month to discuss the
subsidy program, the people said, asking not to be named as the information is private.
The talks underline Ambani’s ambitions for the company to make rapid growth in renewable energy
to supplement its existing businesses. Reliance said last month it plans to build factories to produce
solar components, energy storage batteries, electrolysers for making green hydrogen and fuel cells.
Prime Minister Narendra Modi’s government has announced financial benefits for manufacturing in
a range of sectors, including solar energy and batteries, to revive an economy battered by the
pandemic and to reduce dependence on imports. Souring relations with China, India’s biggest trade
partner and supplier of nearly 80% of the country’s solar modules, have bolstered the push for self-
dependence.
It’s an opportunity that’s drawing local and foreign investors. State-run miner Coal India Ltd., which
is examining new businesses to offset a slowdown in demand for the fuel, is also considering putting
in bids for subsidies to manufacture solar equipment, the people said. U.S. firm CubicPV Inc. said
this month it’s looking for an Indian partner to jointly bid for the incentives.
Reliance and Coal India didn’t immediately respond to emails seeking comment.
India, the world’s third biggest emitter of greenhouse gases, plans to expand its renewable power
capacity nearly five-fold to 450 gigawatts by the end of the decade, aiming to reduce dependence
on fossil fuels that currently drive its economy. Solar power will account for around 62% of the 2030
target, meaning the country will need to add about 26 gigawatts of capacity annually for the next
nine years. The country’s own factories can currently meet less than half the demand for modules.
The government is giving 45 billion rupees ($603 million) to companies setting up solar manufacturing
facilities. Proposals like the plan Reliance unveiled last month, to make the entire chain of products -- from
raw material polysilicon to finished modules -- would win preferential treatment, ministry documents show.

NewBase July 17-2021 Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oil falls for the week on supply concerns, rising COVID cases
Reuters + NewBase
Oil prices were little changed on Friday and ended the week lower, sapped in volatile
trade by expectations of growing supplies just when a rise in coronavirus cases could
lead to lockdown restrictions and depressed demand.
Summary
 Brent falls for third week in a row
 U.S. retail sales unexpectedly increased in June
 OPEC expects world oil demand to increase next year
 Rise in new coronavirus cases triggers new lockdowns
 U.S. oil rigs up 2 to highest since April 2020 - Baker Hughes
Brent futures rose 12 cents, or 0.2%, to settle at $73.59 a barrel, while U.S. West Texas Intermediate
(WTI) crude rose 16 cents, or 0.2%, to settle at $71.81. Earlier in the volatile session, both
benchmarks were down over $1 a barrel.
Despite the small gains, Brent fell almost 3% for the week, marking a decline for the third week in a
row for the first time since April 2020. WTI fell almost 4% this week, which would be its biggest
weekly percentage decline since March.
Oil price special
coverage

U.S. retail sales unexpectedly increased in June as demand for goods remained strong even as
spending shifts back to services, bolstering expectations that economic growth accelerated in the
second quarter.
With oil prices mostly rising over the last several months, the U.S. oil rig count continued its slow
increase, gaining two rigs this week to 380 active units, their highest since April 2020, according to
energy services firm Baker Hughes.
U.S. crude production has increased by 300,000 barrels per day (bpd) over the last two weeks,
rising to 11.4 million bpd in the week ended July 9, the highest since May 2020, according to federal
data.
Saudi Arabia and the United Arab Emirates reached a compromise earlier this week, paving the
way for OPEC+ producers to finalise a deal to increase production.
"The longer it takes for OPEC+ to announce an extraordinary meeting to vote on the extra barrels,
the more it implies other OPEC+ members may also want increases to their baseline quota," said
Bob Yawger, director of energy futures at Mizuho in New York, noting reports Iraq was seeking to
increase its baseline.
OPEC+, which groups the Organization of the Petroleum Exporting Countries with Russia and other
producers, had earlier failed to agree after the UAE sought a higher baseline for measuring its output
cuts.
OPEC said on Thursday it expected world oil demand to increase next year to around levels seen
before the pandemic, about 100 million bpd, led by demand growth in the United States, China and
India.

But the rise in coronavirus cases related to the highly contagious Delta variant could trigger new
lockdowns that would likely reduce recent bullish oil demand forecasts.
Oil declined the most this week since March as a resurgence of Covid-19 threatened the outlook for
global fuel consumption in the near-term.
Futures in New York edged up on Friday but settled 3.7% lower for the week. The rapidly
spreading delta variant is triggering renewed restrictions on movement as it sweeps across the
globe. The U.K. is considering stricter measures due to a surge in cases, Singapore is shutting
hundreds of nightlife venues, and in the U.S., a mask mandate has been reinstated in Los Angeles
County.
At the same time, crude markets face the prospect of extra supplies from the OPEC+ coalition, as
the United Arab Emirates and Saudi Arabia repair a rift that has stymied the group’s decision-
making process. A stronger dollar has also dimmed the appeal of commodities priced in the U.S.
currency this week.
“It was a one-two punch for the petroleum complex this week: the compromise agreement between
OPEC+ and the U.A.E. signaled that more supply will be forthcoming to the market, after all,” said
John Kilduff, a partner at Again Capital LLC. “The other factor is the impact of COVID-19 delta
variant, which is a threat to the pace of demand recovery.”
Despite the pullback, crude has surged about 13% over the last three months as a global vaccine
rollout helps restore economic activity. Forecasters from the International Energy
Agency to Citigroup Inc. predict that the market will get tighter in coming months.
Still, concerns over demand in the near-term are causing the structure of the U.S. crude market to
weaken. While there’s still a premium on the most immediate contracts -- a condition known as
backwardation that signals tight supplies -- it has eased significantly in some parts of the forward
curve. The prompt premium is at just 25 cents a barrel on Friday, from 75 cents a week ago.

NewBase Special Coverage
The Energy world – July - 17- -2021
World’s recoverable oil now seen 9 % slimmer - Rystad Energy
Source: Rystad Energy
Every year and following the publication of the BP Statistical Review, Rystad Energy releases its
own assessment to provide an independent, solid and clear comparison of how the world’s energy
landscape changed last year. Our 2021 review deals a major blow for the size of the world’s
remaining recoverable oil resources – but it also shows that oil production and consumption can
align with climate goals.
Rystad Energy now estimates total recoverable oil resources at 1,725 billion barrels, a significant
reduction of last year’s estimate of 1,903 billion barrels. Out of this total, which shows our estimate
of how much oil is technically recoverable in the future, about 1,300 billion barrels are sufficiently
profitable to be produced before the year 2100 at a Brent real oil price of $50 per barrel.
'In this scenario, global production of oil and natural gas liquids will fall below 50 million barrels per
day by 2050. Exploring, developing, processing and consuming this amount of commercially
extractable oil will lead to gross greenhouse gas emissions of less than 450 gigatonnes of CO2 from
now until 2100. This is compliant with IPCC’s carbon budget for global warming limited to 1.8°C by
2100,' says Rystad Energy’s Head of Analysis, Per Magnus Nysveen.
US and China take the largest hit by the revision:
This year’s review of global recoverable oil resources is based on resources modelled at well level
rather than field level. This more detailed approach has removed 178 billion barrels from the

expected accounts as the confidence level for decline rates has increased with the amount of new
information gathered.
Our updated report also includes revisions for proved reserves. Here Rystad Energy applies a
consistent set of conservative probabilities, as opposed to official reporting by authorities which is
deemed less consistent.
Among other findings, we see significant differences among OPEC members on the longevity of
proved reserves, ranging from well below 10 years for some members to almost 20 years for Saudi
Arabia and the UAE.
In terms of absolute volumes removed from non-OPEC producers, remaining recoverable resources
in the US are now reduced to 214 billion barrels, losing 30 billion barrels from last year’s estimate.
China suffers the second-largest loss with its remaining recoverable resources now limited to 50
billion barrels, a downwards revision of 26 billion barrels.
Mexico’s recoverable resources are third on the loss list, downgraded by 12 billion barrels to 26
billion barrels. Most of this year’s revisions are driven by lower upside potential from shale oil drilling
due to complex geology and the need for extensive exploration campaigns and improved fracking
technologies.
The remaining recoverable resources of OPEC countries are reduced by 53 billion barrels to 741
billion barrels. Iran and Saudi Arabia have the largest revisions, losing 11 billion barrels each, with
Saudi recoverable oil volumes now calculated at 288 billion barrels and Iranian volumes at 101

billion barrels. Iraq follows in third place, seeing its recoverable resources shrink by 8 billion barrels
to 110 billion barrels.
Who sits on the largest resources?
In this revision, Saudi Arabia keeps the throne as the producer with the largest volumes of
recoverable oil resources (288 billion barrels). The US follows second (214 billion barrels), Russia
third (149 billion barrels) and Canada fourth (138 billion barrels).
In Central and South America, Brazil remains first in recoverable resources, sitting on 83 billion
barrels (down 2 billion barrels from last year’s update).
In Europe, with 19 billion barrels (down by 1 billion barrels in this update), Norway remains ahead
of the UK, whose volumes have shrunk by 2 billion barrels to 10 billion. In Africa, resource leader
Nigeria lost 6 billion barrels and its recoverable resources are now estimated at 20 billion barrels.
Unlike most countries in our analysis, Australia’s estimated recoverable oil resources are now seen
higher by 2 billion barrels at 23 billion barrels.

The time stamp of Rystad Energy’s newest resource assessment is 1 January 2021. In other words,
our analysis illustrates where the remaining recoverable resources of each country stood at the
beginning of this year.

NewBase Energy News 17 July 2021 - Issue No. 1443 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.

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