UAE ministry signs sustainable finance

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NewBase Energy News 03 July 2019 - Issue No. 1257 Senior Editor Eng. Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
UAE ministry signs sustainable finance signed a pledge with
Abu Dhabi Global Market
The National + WAM
The UAE Ministry of Climate Change and Environment signed a pledge with the financial free zone,
Abu Dhabi Global Market, ( ADGM) to embed sustainable finance policies in the UAE and wider
region. It is part of national commitments to fight climate change.
“We know that climate action makes economic sense, and as we grow our financial services industry
here in the UAE, we are determined to do so sustainably,” Dr Thani bin Ahmed Al Zeyoudi, UAE
Minister of Climate Change and Environment, said on Sunday.
“[With the agreement] we make Abu Dhabi the go-to, natural, professional environment for clean
technology and say to potential investors: we are open for conversations about how our frameworks
and capacity can support you.”

Mr Al Zeyoudi was speaking to state news agency Wam on the sidelines of the Abu Dhabi Climate
Meeting, hosted in collaboration with the United Nations. It was attended by around 1,000 political
leaders and climate change experts.
The term "sustainable finance" refers to any form of financial service incorporated into the strategies
of businesses or investment decisions intended to yield environmental, social and economic
benefits.
The UAE has a climate change action plan — set out in the UAE Green Agenda 2030 and the
National Climate Change Plan 2050 — that includes obtaining 50 per cent of the country’s energy
needs from clean energy, and reducing emissions from the power sector by 75 per cent by 2050.
The country has also invested $1 billion (Dh3.67bn) in aid to developing countries to help fund
Under the deal with ADGM, the partners pledged to address regulation and funding gaps to attract
private investment and pioneering clean technologies to the region.
They also agreed to disseminate information on international sustainable finance to businesses
working within the free zone, and to work towards the development of a comprehensive legal
framework to govern sustainable finance.
Also at the meeting on Sunday, Dr Al Zeyoudi called on experts from the UAE and beyond to work
together to devise solutions to reduce carbon emissions.
“I believe we have a clear opportunity to embark on a new era of economic growth spurred by global,
collaborative investment in climate action,” he said. “In 2019, climate change is not just about the
planet, it is also about people, and we can save lives by eliminating sources of air pollution.
“But, more than that, it is the best investment case we have ever known. Climate change knows no
borders, and neither should we.” He said the UAE is integrating its policies into the management of
sovereign assets, through the One Planet Sovereign Wealth Fund Group, set up in 2018.
The group comprises sovereign funds Abu Dhabi Investment Authority, Kuwait Investment
Authority, the New Zealand Superannuation Fund, Norges Bank Investment Management of
Norway, Saudi Arabia’s Public Investment Fund and Qatar Investment Authority — which
collectively manage more than $3 trillion in assets.
The group aims to promote analysis of climate change impacts into the management of large, long-
term and diversified asset pools, to foster understanding among investors of the climate-related
risks of their investments, and learn how to minimise those risks.

Kuwait: KOC awards Halliburton Offshore Services contract
Source: Halliburton
Kuwait Oil Company (KOC) and Halliburton have signed an Integrated Offshore Drilling Services
contract for six high-pressure high-temperature (HPHT) exploration wells on two jack-up rigs in the
Arabian Gulf.
Through Halliburton Project Management, the Company will provide and manage drilling, fluids,
wireline and perforating, well testing, coring, cementing, coiled tubing, and all offshore logistical
services. Additionally, Halliburton will provide the offshore rigs and supply vessels for the project.
'As part of KOC’s plan to increase production capacity by charting new territory in Kuwait’s offshore
reserves, our Company is pleased to announce that we will be working on this ambitious project
alongside one of our closest business partners, Halliburton, who will be assisting us through the
provision of their many years of experience in the field of offshore exploration and production,' said
KOC CEO Emad Mahmoud Sultan.
'We are grateful for the opportunity to collaborate with KOC and implement our integrated services
and innovative technologies to accelerate offshore development, reduce drilling and completions
costs and increase recovery,'said Halliburton Eastern Hemisphere President Joe Rainey.
The contract includes a 3-year term with a 6-month extension option. Work will begin in mid-2020.
The expected start date for the first rig is July 2020 and the second rig is January 2021.

Saudi Aramco inks MoU for non-metallic materials production facility
Saudi Gazette + NewBase
Saudi Aramco signed a memorandum of understanding with Baker Hughes, a GE company
(BHGE), on Tuesday to create a new joint venture facility in Saudi Arabia to manufacture non-
metallic materials for use in a variety of areas of the energy industry.
This is part of Aramco’s strategy to play a leading role in accelerating the deployment of non-metallic
materials globally, it said in a press statement. The joint venture will initially focus on non-metallic
reinforced thermoplastic pipes as a first and critical step towards developing such capabilities in
Saudi Arabia.
“This partnership with BHGE is another step in Saudi Aramco’s journey towards expanding the use
of innovative non-metallic materials in its operations," said Ahmad Al Sa’adi, senior vice president
for technical services at Saudi Aramco.
"Saudi Aramco has successfully deployed more than 5,000 kilometers of non-metallic pipes,
resulting in a significant increase in efficiency and reduction in maintenance and replacement costs
across the company’s operations. Producing these materials in the Kingdom would also unlock
opportunities for local manufacturers and facilitate knowledge transfer.”

“As a full stream oil and gas service and technology provider, we have a deep background driving
non-metallic product development that will benefit a wide range of industries," said Neil Saunders,
CEO of BHGE Oilfield Equipment. "Saudi Aramco’s vision to expand their product development in
the region aligns with our vision to support innovation and manufacturing in Saudi Arabia.”
Non-metallic applications are deployed in various industries, including oil and gas, construction,
automotive, packaging and renewable energy to manufacture products including flowlines,
downhole production tubing, vessels, pumps, and cooling towers, all of which are manufactured
from non-metallic materials such as plastic, carbon fiber, and glass fiber.
Saudi Aramco recently opened the Non-
metallic Innovation Center in the United
Kingdom in collaboration with the UK-
based Welding Institute and the National
Structural Integrity Research Centre to
conduct research and development of non-
metallic technologies. The center
collaborates with leading academic
institutions and manufacturers to develop,
test, and market new products.

Tunisia: Serinus Energy provides update on country operations
Source: Serinus Energy
Serinus Energy has provided an update on its operations in Tunisia, the reopening of the Chouech
Es Saida field in southern Tunisia is progressing as expected. Following the extensive clearing of
sand from the road and surface facilities, the Company started the first well workover on the CS-3
well on 27 June 2019.
This workover is expected to take two weeks and includes the installation of a new electrical
submersible pump. Once completed, the CS-3 well will be brought onto production and the
workovers of the other three wells will be performed sequentially. The Company anticipates that all
Chouech wells will be on production by the end of August 2019.
The Sabria field continues to perform in line with management expectations and an operational and
production update will be given at the time of the H1 results in August.

Austria: OMV and Verbund to build largest solar plant
Oman Observer Reuters + NewBase
Austria’s oil and gas group OMV and utility Verbund have agreed to jointly build a solar plant that
will have the capacity to supply 5,500 households with electricity, the companies said on Monday.
Austria’s largest photovoltaic plant, which will deliver around 18 Gigawatt Hours (GWh) of power, is
due to start operations in the fourth quarter of 2020 and will result in annual savings of around
12,000 tonnes of CO2 per year, the companies said in a joint statement.
The companies plan to each invest 5 to 6 million euros (£4.46-5.36 million) in the solar plant,
Verbund Chief Executive Wolfgang Anzengruber said at a news conference.
“This strategic, long-term cooperation between Austria’s two biggest energy companies brings us a
huge step forward towards the energy future and towards realising our climate targets”,
Anzengruber said.
OMV and Verbund have been in talks regarding possible joint projects for years. In 2017, OMV
bought a 40 per cent stake in Smatrics, a company that provides charging points for electric cars,
owned by Verbund and Germany’s Siemens.
OMV and Verbund also said on Monday that they would evaluate options to build an electrolytic
hydrogen production facility. That technology takes power from renewables and uses it to split water
via electrolysis. The green hydrogen produced by this process can be used for chemical production
processes.
Verbund is already working on a hydrogen project with Germany’s Siemens and Austrian
steelmaker Voestalpine.

Nigeria: LEKOIL signs MoU for added development at Otakikpo
Source: Lekoil
AIM listed LEKOIL, the oil and gas exploration and development company with a focus on Nigeria
and West Africa more generally, has announced the Otakikpo Joint Venture (JV) between Green
Energy International Limited ('GEIL') and LEKOIL has signed a Memorandum of Understanding
('MOU') with Schlumberger and a subsidiary of a major international oil company which has been
operating in Nigeria for more than half a century.
The MOU covers a comprehensive infrastructure sharing and drilling programme around a group of
marginal field assets in OML 11. Standard Chartered Bank ("SCB") is to act as the lead financial
advisor for the Project and perform financial advisory, security and banking services required for the
Project.
The phased development plan of the project consists of drilling up to five new wells in Otakikpo,
expanding processing infrastructure to comprise an onshore terminal to be located outside the
Otakikpo field operations area, construction of an export pipeline connecting the onshore terminal
to an offshore buoy to handle Otakikpo and other fields in OML11.
The Otakikpo Joint Venture will partake in the costs of its field development with funds provided for
such participation by the development consortium. Project management and associated asset
management costs provided by Schlumberger will be shared between the Otakikpo Joint Venture
and the operators and owners of other marginal fields participating in the Project.
Capital expenditure to be incurred by the Otakikpo Joint Venture is expected to be approx. US$170
million covering new wells and processing infrastructure, of which LEKOIL is expected to fund US

$68 million. The anticipated costs consist of debt repayment to financing parties, including the
Major Oil Company, in addition to a project implementation fee paid to Schlumberger.
Repayment of the facilities anticipated to be provided to the Otakikpo Joint Venture pursuant to the
project will be made from production revenues from Otakikpo, in priority to any existing lending
facilities (subject to agreement with existing lenders), future CAPEX and returns to equity holders.
Under the terms of the MOU, the Major Oil Company will provide funding to the Otakikpo Joint
Venture alongside the other funding partners, subject to due diligence, project economics, entry into
definitive documentation and final investment decision.
The Otakikpo Joint Venture will enter into an exclusive offtake agreement with the Major Oil
Company for the sale of crude produced pursuant to this project. Schlumberger will act as technical
and project execution partner to provide oilfield services and project management services to assist
in ramping up production and long-term field management. The Consortium will also form
multidisciplinary project management teams from LEKOIL and GEIL.
Due diligence will be undertaken and the financial terms and cost of capital will be finalized following
final investment decision. The final investment decision is subject to the satisfaction of customary
conditions precedents, including the credit committee approval of financing parties and the
execution of definitive project agreements. Site mobilisations are tentatively scheduled for late Q3
2019.
Lekan Akinyanmi, CEO of LEKOIL said:
'This MOU is a significant milestone for LEKOIL and the Otakikpo JV. It secures the necessary
funding, subject to the various conditions being satisfied, to drill additional wells and unlock further
value at Otakikpo.
We are pleased to be working with Schlumberger (who brings world class implementation) and other
members of the consortium. We look forward to the transformation of operations infrastructure and
an opportunity to earning revenue along the value chain'.

U.S:Petroleum,N.gas, and coal continue to dominate U.S. energy
Source: U.S. Energy Information Administration, Monthly Energy Review
Fossil fuels—petroleum, natural gas, and coal—have accounted for at least 80% of energy
consumption in the United States for well over a century. Overall energy consumption in the United
States reached a record high in 2018 at 101 quadrillion British thermal units (Btu), of which more
than 81 quadrillion Btu were from fossil fuels. Despite the increase, the fossil fuel share of total U.S.
energy consumption in 2018 increased only slightly from 2017 and was the second-lowest share
since 1902.
The increase in fossil fuel consumption in 2018 was driven by increases in petroleum and natural
gas consumption. Coal consumption fell by 4.3% in 2018, the fifth consecutive annual decline. U.S.
consumption of coal peaked in 2005 and has declined nearly 42% since then. U.S. coal consumption
fell to 687 million short tons in 2018, the lowest level of coal consumption in the United States since
the 1970s.
Natural gas consumption increased in 2018, reaching a new record consumption level of 82.1 billion
cubic feet per day. Natural gas consumption has increased in 8 of the past 10 years. Growth in
natural gas consumption has largely been driven by increased consumption in the electric power
sector. Overall, U.S. consumption of natural gas has increased by 37% since 2005.
Petroleum consumption also increased in 2018 as petroleum product supplied reached the
equivalent of 20.5 million barrels per day. Despite the increase in 2018, U.S. petroleum consumption
remains lower than its peak consumption level set in 2005. Petroleum has been the largest source
of energy consumption in the United States since surpassing coal in 1950.

The renewable share of energy consumption in 2018, which includes hydroelectricity, biomass, and
other renewables such as wind and solar, was 11.4%, slightly less than its 2017 share. The largest
growth in renewables over the past decade has been in solar and wind electricity generation.
Energy consumption in the United States has undergone many changes in the nation’s history, from
wood as a primary resource in the 18th and 19th centuries, to the onset of coal and petroleum use,
and to the more modern rise of nuclear power in the late 20th century and renewables in the early
21st century.
The Monthly Energy Review’s pre-1949 estimates of U.S. energy use are based on two sources:
Sam Schurr and Bruce Netschert’s Energy in the American Economy, 1850–1975: Its History and
Prospects and the U.S. Department of Agriculture’s Circular No. 641, Fuel Wood Used in the United
States 1630–1930, published in 1942.
Appendix D of EIA’s Monthly Energy Review compiles these estimates of U.S. energy consumption
in ten-year increments from 1635 through 1845 and five-year increments from 1845 through 1945.
Data for 1949 through the present day are available in the latest Monthly Energy Review.

NewBase July 03 – 2019 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Oil prices steady on extended supply cuts, U.S. stocks draw
Reuters + NewBase
Oil prices edged higher on Wednesday after a steep fall in the previous session, supported by
extended output cuts by OPEC and its allies despite concerns that a slowing global economy could
crimp demand.
An expected large draw in U.S. crude oil inventories also underpinned sentiment after a bigger-
than-expected stocks fall in a private survey. Brent crude futures LCoc1 for September delivery
were trading up 15 cents, or 0..24%, at $62.55 a barrel by 04:44 GMT.
U.S. crude futures for August CLc1 were up 16 cents, or 0.28, at $56.41 a barrel. Both benchmarks
fell more than 4% on Tuesday as worries about a slowing global economy overshadowed OPEC
supply cuts.
Oil price special
coverage

The Organization of the Petroleum Exporting Countries and other producers such as Russia, a
group known as OPEC+, agreed on Tuesday to extend oil supply cuts until March 2020 as members
overcame differences to try to prop up prices.
“The OPEC+ meeting showed the members sticking together in tough times, characterized by
weakening global demand outlook, aiming for a more balanced oil market, despite clear market
share implications,” said Amarpreet Singh, analyst at Barclays Commodities Research in a note.
“This is supportive of oil prices, in our view, even as the market remains squarely focused on weak
macro signals.” Ahead of government data due later on Wednesday, industry group the American
Petroleum Institute (API) said that U.S. crude inventories fell by 5 million barrels last week, more
than the expected decrease of 3 million barrels. <EIA/S>
The OPEC+ agreement to extend oil output cuts for nine months should draw down oil inventories
in the second half of this year, boosting oil prices, said analysts from Citi Research in a note.
“Keeping cuts through the end of 1Q aims to avoid putting oil into the market during a seasonal low
for demand and refinery runs, as well as providing time to assess the impacts of IMO 2020,” they
said.
Still, signs of a global economic slowdown hitting oil demand growth worried investors after global
manufacturing indicators disappointed and the U.S. opened another trade front after threatening the
EU with more tariffs to offset government aid to the aviation industry.
Barclays expects demand to grow at its slowest pace since 2011, gaining less than 1 million barrels
per day year-on-year this year. Morgan Stanley, meanwhile, lowered its long-term Brent price
forecast on Tuesday to $60 per barrel from $65 per barrel, and said the oil market is broadly
balanced in 2019. Crude prices were also capped by signs of a recovery in oil exports from
Venezuela in June and growth in oil production in Argentina in May.

NewBase Special Coverage
News Agencies News Release July 03-2019
Renewed OPEC oil supply cuts signs of weakness, not strength.
byLiam Denning
“OPEC+” is now the accepted nomenclature of the cobbled-together club of oil producers that has
been trying to bolster prices since late 2016. As a brand, it has the advantages of a certain familiarity,
expansiveness and positivity. It also rather oversells the product.
Monday’s meeting of the OPEC bit of
things ran very late (the pluses are
due to meet Tuesday). This is
notable for two reasons. First, the
delay reportedly stemmed largely
from haggling among delegates
about a proposed OPEC+ charter to
enshrine cooperation among them.
Second, the most salient decision,
about whether or not to extend
supply cuts, had been taken already
by Saudi Arabia and Russia at the
weekend’s G-20 gathering in Japan.
Once Prince Mohammed Bin Salman
and President Vladimir Putin
– representing almost half the group’s output between them – had agreed on extending supply cuts,
the wider meeting was just a formality.
Having everyone schlep to Austria anyway does help with oil demand, one supposes. But there’s
something inescapably farcical about a meeting convened after the main decision has been
publicized, but which then runs late because the delegates can’t agree on a declaration of harmony.
The second iteration of the OPEC+ supply cuts, which got underway in January, called on 21
countries – including 10 OPEC members – to keep about 1.2 million barrels a day off the market.
Iran, Libya, and Venezuela – beset by sanctions, civil conflict and economic collapse, respectively
– are exempt. When you look at the actual breakdown of cuts since then, however, it reinforces
the sense that the group’s meetings are more theater than anything else at this point.
Consider that half the members subject to the agreement are tasked with the equivalent of a cover-
charge to get into the club: cutting output by just 20,000 barrels a day or less. Having more countries
sign up no doubt makes for a better group photograph.
But the idea that anyone is actually tracking South Sudan’s compliance with its commitment to keep
all of 3,000 barrels a day offline tends to detract from the vaunted seriousness of the operation.
(Reader, South Sudan isn’t complying.)
The group as a whole has done better, keeping an average of 1.33 million barrels a day off the
market through May, for compliance of 111%. But the burden falls very unevenly. Saudi Arabia
accounts for more than half the total barrels withheld, with compliance of 216%.

Trusted partner Russia, on the other hand, has met only 64% of its (smaller) pledge – and even
that’s partly due
to contamination problems
on a major pipeline.
But it’s the exempted
countries – OPEC-minus?
– that really show up the
whole project.
No quotas are enforced for
Iran, Libya and Venezuela,
of course. But taking 3%
off their October 2018
output – which is roughly
how the others were set
– provides a proxy for what
they might have been
expected to contribute. On
that basis, these three
really punch above their weight:
Negative Effect
The three exempted OPEC countries of Iran, Libya and Venezuela have 'delivered' more cuts to oil
supply than the 11 included ones
Source: International Energy Agency, Bloomberg Opinion analysis
Note: Data for OPEC exempted calculated against theoretical supply baseline of October 2018.
OPEC-minus seriously ‘overcomplied’ with its theoretical cuts, at more than 600% in aggregate.
Including these three countries, adjusted supply “cuts” add up to about 2.4 million barrels a day
through the first five months of the year. The top 10 countries account for all of that and more, given
non-compliance by others.
From Major To Minus

Iran has 'cut' almost as much oil supply as Saudi Arabia, and Venezuela almost as much as Russia
and Kazakhstan combined
Source: International Energy Agency, Bloomberg Opinion analysis
Note: Average oil-supply cuts, January-May 2019. Data for OPEC exempted calculated versus
October 2018 supply.
This represents continuity of sorts. During the first phase of the OPEC+ agreement, spanning 2017
and 2018, involuntary cuts arising from Venezuela's collapse were vital to the project’s success (so
to speak).
This outsize role for the chronically afflicted reinforces the sense that even if OPEC isn’t quite dead,
it isn’t quite living either. Yes, there are meetings, communiques, officials, a website, printed
stationery and all the rest of it. But the actual task of managing supply has become the preserve of
a relative few concentrated on the Arabian peninsula, aided by an ad hoc group of the walking
wounded – including an arch adversary of those Arab states – and lent a veneer of credibility by a
mercurial non-member, Russia. It was the latter, notably, that announced the pre-agreement on
extending cuts, not Saudi Arabia.

The very fact that OPEC has tried to rope in ever more pledgers and shows so much deference to
Moscow demonstrates its inherent weaknesses. The biggest of these is the sheer overweening
dependence of many of its members on their favorite commodity.
This makes them all fragile in an oil market that has become more competitive – especially as U.S.
shale supply surges on the back of any price increases – and is subject to building constraints on
demand.
Khalid Al-Falih, Saudi Arabia’s energy minister, confirmed at the eventual OPEC press conference
that the group is now targeting its efforts at reducing global oil inventories to the average level of
2010-14.
This makes sense on one level, given bloated inventories skewed the average after 2014. But with
demand having risen by about 10% versus average demand in that period, OPEC’s new target
represents a more aggressive approach.
Al-Falih added, in response to a question, that he is essentially waiting out the shale boom in
expectation of it eventually peaking and declining. In other words, he’s committed.
Despite such language, the supply cuts themselves and rising geopolitical tension, the recent rally
in Brent crude since mid-June took it back only to where it traded in late May.
Then Monday morning’s initial rally gave way as the OPEC meeting segued from foregone
conclusion to … incredibly delayed foregone conclusion. The market remains unimpressed.
The big problem here is that ongoing pledges to cut supply are ultimately a sign of weakness in the
oil market, not strength.
So while formalizing them with an OPEC+ charter is intended to signal ongoing support, it cannot
help but raise the question of why such extraordinary measures are now needed on a permanent
basis. At this point, pluses not only don’t outweigh the minuses, they positively reinforce them.

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,
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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 28 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 2019 K. Al Awadi

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