New base energy news 05 sep 2018 no 1198 by khaled al awadi-cpdf

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NewBase Energy News 05 September 2018 - Issue No. 1198 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: Adnoc commissions new petroleum Calcined Coke unit
Gulf News + The National
Abu Dhabi National Oil Company (Adnoc) announced that it has successfully completed the
commissioning of a specialised coker unit as part of its Carbon Black and Coker Project.
The development comes as the national oil company moves ahead with its aggressive downstream
strategy to increase the production of petrochemical products to supply it to growth markets in Asia
including China.
In a statement on Sunday, Adnoc said that Carbon Black & Coker Project incorporates a coker,
known in the oil and gas industry as a ‘delayed coker’, that will allow Adnoc Refining to recover
highly specialised and valuable grades of carbon black and calcined coke that is used in industries.
“The successful commissioning of the coker project, along with the production of the first Green
coke created in the UAE, will improve Adnoc Refining’s margins by maximising value from every
barrel of crude oil that we refine,” said Jasem Ali Al Sayegh, CEO of Adnoc Refining, a subsidiary
of Adnoc.
“By working with local petrochemicals and aluminium industries, and engaging new local and
international customers for these high value products, we will deliver greater value to Adnoc and
more broadly to the UAE economy.”
Adnoc Refining can produce 40,600 tons of two different grades of Carbon black per year, and
430,000 tons of high value anode grade calcined coke through the Carbon Black & Coker Project.

Borouge, a joint venture between Adnoc and Borealis, makes extensive use of special carbon black
grades across a range of products, including high-pressure water and gas pipes, steel pipe coatings
and linings, and stand-alone piping.
Calcined coke is a key ingredient in the anodes used in the electrolysis process that separates pure
aluminium from bauxite ore.
Adnoc is investing Dh165 billion ($45 billion) over the next five years to create the world’s largest
integrated refining and petrochemicals hub in Ruwais, where the company will convert 20 per cent
of its crude to chemicals, tripling petrochemical production capacity to 14.4 million tons per year, by
2025.

Saudi Aramco awards major Marjan field deal to BHGE
NewBase + Arabian Business
Saudi Aramco has awarded the first large-scope integrated services contract for its Marjan oilfield
– the first of three major offshore expansions in Saudi Arabia, and the company’s largest upstream
development project this year – to Baker Hughes, a GE company (BHGE).
Under the contract’s terms, BHGE will provide drilling services, coiled tubing services and drilling
fluids engineering services in Marjan.
Mohammed Y Al Qahtani, senior vice president of Upstream at Saudi Aramco, said: “The Marjan
oilfield is one of the major upstream developments this year that will contribute to the kingdom’s oil
production strengths, helping maintain capacity and meet domestic and global demand. We are
pleased to work with BHGE as a partner with proven offshore drilling strengths and technologies.”
Lorenzo Simonelli, chairman, president and
CEO, said: “We are honoured to win the
integrated services contract from Saudi
Aramco, which highlights our strong
performance track-record in Saudi offshore
operations. BHGE is a leader in providing
offshore drilling, and we understand the
requirements of our customers.
With a significant number of wells, the
Marjan expansion requires proven and
efficient technology, matched by digital
competencies that BHGE can deliver,
which will make the operations seamless.
All our solutions for Marjan are designed to
achieve the best outcomes that meet Saudi
Aramco’s goals.”
Under the contract, BHGE will commence
work this month with an aim to increase the
field’s capacity. BHGE’s provision of drilling
services will include logging-while-drilling,
reservoir navigation services, and rotary steerable services.
Lorenzo Simonelli (left) with Mohammed Al Qahtani and other
officials at the signing ceremony

UK: GUA-P2 side-track well in Anasuria Cluster successfully
completed with enhanced production expected.. Source: Hibiscus Petroleum
Hibiscus Petroleum has announced that the GUA-P2 side-track ('P2-ST') well, located in
the Guillemot A field of the Anasuria Cluster in the United Kingdom Central North Sea ('UKCNS')
and targeting untapped volumes of oil in the Forties reservoir, has been drilled and completed using
the West Phoenix semi-submersible drilling rig.
During the clean-up and flowback phase of the P2-ST programme, the well achieved a stabilised
gross production flow rate to the Anasuria FPSO of 4,750 barrels of oil per day (2,375 barrels of oil
per day, net to the Group). The flow rate was established during a 20-hour flow period through a
32% choke and with the application of gas lift at a rate of 1.7 million standard cubic feet a day.
The project to re-enter the GUA-P2 well and side-track commenced in early June 2018 and was
executed by the Anasuria Operating Company Limited ('AOC'), the operator of the Anasuria Cluster
of oil and gas fields. AOC is equally owned by Anasuria Hibiscus UK and Ping Petroleum UK. The
P2-ST is currently shut-in to allow the drilling rig to demobilise from its location before production
commences once again in early September 2018.
Commenting on the results of the side-track well, Hibiscus Petroleum’s Managing Director, Dr Kenneth
Pereira, said:
'We are extremely pleased with the initial production rate achieved by the P2-ST well. Test results
have exceeded our expectations. Over the next few months, we will gradually increase choke size

and determine the optimum parameters to flow this well. The P2-ST project represents the Group’s
first major capital expenditure programme in the UKCNS. In an area where we jointly operate the
fields, the drilling and completion of the P2-ST well and the achievement of a positive result has
enhanced our operating track record.
Furthermore, this project is consistent with the Group’s strategy to arrest the natural decline and
add to oil and gas production from the Anasuria Cluster. Our target remains to achieve a production
of 5,000 barrels of oil per day from Anasuria by the end of financial year 2020 and the capability to
undertake projects such as the GUA-P2-ST will be a critical enabler. We look forward to the start of
production from the P2-ST well by the end of this week as we are in a time of favourable crude oil
price levels.'
The Anasuria Cluster consists of the Teal, Teal South, Guillemot and Cook fieldswhich produce to
the Anasuria Floating, Production, Storage and Offloading facility ('Anasuria FPSO'). The Anasuria
Cluster is located offshore in the United Kingdom sector of North Sea. The Group’s indirect wholly-
owned subsidiary Anasuria Hibiscus UK holds 50% joint-operating interests in the P013 licence
consisting of the Teal, Teal South and Guillemot A fields, as well as 19.3% non-operating interest
in the P185 licence consisting of the Cook field.

Namibia: Tullow Oil spuds Cormorant-1 well in PEL 37 offshore
Source: Pancontinental Oil & Gas
JV partner Pancontinental Oil & Gas has announced that operator Tullow Oil has spudded
the Cormorant-1 well in Petroleum Exploration Licence 37 ('PEL 37') offshore the Republic of
Namibia. Pancontinental holds a 20% effective interest in PEL 37 and was the originator of the
project, and initial Operator prior to a farmout to Tullow. PEL 37 covers an area of 17,295 sq kms in
the Walvis Basin offshore Namibia.
Cormorant-1 is being drilled by the Ocean Rig Poseidon, a 6th Generation drillship, in 545 meters
of water, to a total depth of 3,830 meters subsea. The well will test the oil potential of a mid-
Cretaceous marine turbidite 'fan' sandstone system. Drilling and evaluation of the well is expected
to take about 34 days.
In 2013, the Wingat-1 and Murombe-1 wells, directly south of PEL 37, confirmed high quality mature
oil-prone source rocks in the Walvis Basin. The Cormorant Prospect, mapped using high-quality 3D
seismic data, is one of four submarine fan prospects identified so far in the block and interpreted to
be charged by the same source rocks.
The Cormorant Prospect has gross best estimate prospective recoverable resource potential of 124
million barrels of oil and, if successful, would open a fairway of similar fans, potentially creating a
substantial spread of resources across PEL 37. The total estimated oil potential of the four main
Prospects mapped so far in PEL 37 is 915 million barrels of oil. Additional potential exists in large
'Leads' that have also been identified.
Pancontinental Oil & Gas owns two thirds of Pancontinental Namibia, which holds a 30%
participating interest in PEL 37, giving it a 20% effective interest in PEL 37. Now that drilling has
commenced, Pancontinental will receive cash of US$5.5 million (A$7.5 million) from Africa Energy
Corp.
The participants in Cormorant-1 are: Tullow Namibia (Operator) 35.00%; Pancontinental Namibia
30.00% *; ONGC Videsh Limited 30.00%; Paragon Oil & Gas 5.00%. * Ownership of Pancontinental
Namibia: Pancontinental Oil & Gas 66.67%; Africa Energy Corp. 33.33%.

NewBase September 05 - 2018 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Oil falls below $78 as U.S. storm threat eases, still looking to up
Reuters + Bloomberg + NewBase
Oil fell below $78 a barrel on Wednesday as a tropical storm hitting the U.S. Gulf coast weakened,
offsetting support from forecasts of lower U.S. inventories and sanctions against Iran.
Crude had jumped the previous day as oil companies shut dozens of offshore platforms in
anticipation of damage from tropical storm Gordon. But by Wednesday the storm was weakening,
reducing its threat to oil producers.
“Tropical storm Gordon made an uneventful landfall after dashing expectations that it would
strengthen to a hurricane,” said Stephen Brennock of oil broker PVM. “Instead, it weakened
considerably and deviated away from oil-producing areas, which, as a result, has taken the wind
out of bulls’ sails.”
Brent crude LCOc1, the global benchmark, fell 47 cents to $77.70 a barrel by 0832 GMT. On
Tuesday prices had climbed to $79.72, their highest since May. U.S. crude CLc1 was down 72
cents at $69.15.
“Storm in a teacup,” said analysts at JBC Energy, referring to Gordon’s limited impact on oil pricing.
Oil could gain support if weekly reports on U.S. inventories show a drop in crude inventories, as
expected. Analysts estimate, on average, that stocks fell by about 1.9 million barrels last week.
The American Petroleum Institute, an industry group, releases its supply report at 2030 GMT on
Wednesday, a day later than usual because of the Labor Day holiday on Monday. Official
government figures are due on Thursday.
Oil price special
coverage

Brent has traded between $70 and $80 since April; a range that Saudi Arabia and other producers
in the Organization of the Petroleum Exporting Countries would like to see maintained for now,
OPEC and industry sources have said.
U.S. sanctions targeting Iran’s oil sector from November are already reducing exports from OPEC’s
third-largest producer and counteracting the impact of an agreement by OPEC and its allies to pump
more oil.
“With the anticipation of up to 1.5 million barrels per day affected by the U.S. sanctions on Iran, one
would expect prices to move higher in the weeks ahead,” said Stephen Innes, of futures brokerage
OANDA.
West Texas Intermediate for October delivery declined as much as $1.10 cents to $68.77
a barrel on the New York Mercantile Exchange and traded at $68.83 at 10:49 a.m. in
London. The contract rose 7 cents to $69.87 on Tuesday from Friday’s close. Monday’s
trades were booked Tuesday because of the U.S. Labor Day holiday. Total volume traded
was about 18 percent below the 100-day average.
Brent for November settlement dropped as much as $1.10 cents, or 1.3 percent, to $77.16
a barrel on the ICE Futures Europe exchange. Prices on Tuesday rose to as high as
$79.72. The global benchmark crude traded at a $8.64 premium to WTI for the same
month, near the widest since June 20.
“Storm Gordon blew over after helping to drive Brent to almost $80 per barrel
yesterday,” said Bjarne Schieldrop, chief commodities analyst at SEB AB in Oslo. “Today
Brent gives some back to general concerns for struggling emerging market equities,
currencies and economies.”

U.S. Throttles Iran Oil Flows to Buyers Who Vowed Resistance
The world’s top oil buyers are discovering that U.S. sanctions on Iran will squeeze their trade flows
whether they agree with America or not.
It was only about three months ago that India’s foreign minister said that the country won’t adhere
to unilateral restrictions and will continue buying Iranian crude. China also made similar comments
and was said to have rejected an American request to cut imports. Japan and South Korea have
held talks with the U.S. aimed at securing exemptions.
Yet for all the pushback and negotiations, an emerging pattern shows U.S. sanctions are succeeding
in throttling Iran’s sales to its customers even before the measures take effect in early November.
While America initially wanted a complete halt in purchases, traders are now concerned that even
a revised aim for only cuts would take out enough supply to create a market deficit -- which other
producers may struggle to fill.
“All of Iran’s oil customers are affected by increasing U.S. pressure to halt purchases, even as they
request for concessions to cope with the consequences,” said Den Syahril, a senior analyst at
industry consultant FGE. “We expect India and especially China to maintain some degree of imports,
while buyers in Japan and Korea who’ve cut imports considerably will continue to aggressively seek
waivers up till the last minute.”
Who's Affected?
American allies face mounting pressure to reduce purchases from Iran
Source: FGE
NOTE: Iranian crude oil imports by country; 'Others' include Syria, Russia; 2018 figures are average of Jan.-June volumes
Since the comments about opposing U.S. sanctions, India’s imports from Iran have tumbled and it’s
said to be mulling a 50 percent cut in purchases. Latest data show flows to China, the top crude
buyer, have also shrunk and the Asian country’s own tankers have stopped hauling supply from the
Islamic Republic. Cargoes to South Korea plunged over 40 percent in July, while Japanese firms
have said September-loading shipments may be their last.
After continuing imports, albeit at reduced levels, the buyers must now contend with the ever-closer
Nov. 4 deadline, when the U.S. will reimposesanctions targeting Iran’s crude industry. Countries

that deal with the Middle East producer after that will risk being cut off from the American financial
system, unless they receive a waiver.
While a cargo would need to load only in mid-October to arrive in North Asia the following month,
its purchase will have to be decided in September. With the U.S. not yet saying whether it’s granting
any nation an exemption, all shipments from Iran to its leading customers may be in peril starting
this month. Even if the waivers are provided, they will be based on the promise of keeping flows
limited.
FGE estimates Iran’s exports will slump to below 1 million barrels a day by mid-2019, while industry
consultant Energy Aspects Ltd. expects a plunge of 1.5 to 1.7 million in daily shipments by the end
of this year from current levels of about 2.5 million. With concerns growing that global spare capacity
will be stretched if other producers such as Saudi Arabia pump more to make up for the loss, the oil
market is revealing risks of a crunch.
Near-term futures for Brent crude, the benchmark for more than half the world’s oil, are trading
higher than later contracts in a market structure known as backwardation that typically signals a
supply squeeze. Front-month prices have soared almost 50 percent over the past year, and were
at $79.17 a barrel at 11:01 a.m. in London on Tuesday.
“There’s been a significant bump in the prompt oil contract that’s contributed to the backwardation,
and this bullishness is backed by factors such as U.S. sanctions on Iran,” said Stephen Innes, head
of Asia Pacific trading at Oanda Corp. in Singapore. The market will look to other producers such
as Russia to fill the void, even as Nigeria’s oil minister remains confident of OPEC’s ability to pump
more, said the Singapore-based analyst.
Apart from refiners, shipowners whose vessels help ferry the Middle East nation’s supply, insurers who cover
those cargoes as well as banks that help process payments for the crude are at risk from the sanctions,
further complicating any trade with Iran. Indian Oil Corp., the nation’s biggest refiner, doesn’t have clarity on
purchasing Iranian oil for October due to payment issues, and will wait for direction from the country’s
government, a company official said last month. Japan’s Fuji Oil Co. has effectively stopped buying crude
from the Persian Gulf state because it’s becoming difficult to secure a ship to transport oil, according to a
company spokesman.

NewBase Special Coverage
News Agencies News Release September 05-2018
Melting Ice In the Arctic Is Opening a New Energy Trade Route
Bloomberg - Jeremy Hodges
LNG shippers are taking advantage of open waters as ice caps stage one of their largest retreats
on record.
A new trade route for energy supplies is opening up north of the Arctic Circle as some of
the warmest temperatures on record shrink ice caps that used to lock ships out of the
area.
This year is likely to rank among the top 10 for the amount of sea ice melting in the Arctic
Ocean after heat waves across the northern hemisphere this summer. While that’s
alarming to environmentalists concerned about global warming, ship owners carrying
liquefied natural gas and other goods see it as an opportunity. Their cargoes have
traversed the region for the first time this year without icebreakers, shaving days off
shipping times and unlocking supplies from difficult-to-reach fields in Siberia.

More navigable waters are a boost for Russian President Vladimir Putin’s effort to
expand his nation’s reach in the gas market and for energy companies such as Total SA
and Novatek PJSC, which are leading Arctic developments. They also help reduce
shipping costs for LNG, benefiting buyers and traders of the fuel from PetroChina Co. to
Gunvor Group Ltd.
“There is a growth trend for volumes transported via the Northern Sea Route this year,”
said Sergei Balmasov, head of the Arctic Logistics Information Office, a consultancy in
Murmansk, Russia. “The reason is an increase in LNG exports.”
Arctic Shipping Milestone
An LNG tanker became the first to travel the Northern Sea Route during winter
Source: Bloomberg
While shorter shipping journeys reduce emissions, environmentalists are concerned that
more traffic through the Arctic will add to the amount of black carbon—particles of pure
carbon—settling in the snow from tanker smokestacks. When that soot darkens the
surface of the ice, it speeds up the warming process by absorbing more of the Sun’s
energy.
And with the shipping season through the Arctic starting earlier and ending later, tankers
will spend more time in the area and spew more of their pollution onto the ice.

Turbulent weather in the area also churns the seas, making it almost impossible to clean
up anything that’s spilled. The International Maritime Organization is considering rules
that would ban burning heavy fuel oil in Arctic waters, extending restrictions already in
place in the Antarctic.
“It’s a major concern for us because as the ice melts we are seeing more and more
shipping,” said Sian Prior, lead adviser for the Clean Arctic Alliance, an environmental
group.
Scientists are seeing a rapid change in the Arctic. The Bering Sea between Alaska and
Russia lost about half its ice coverage during a two-week period in February, while the
most northern weather station in Greenland recorded temperatures above freezing for
60 hours that month. The previous record was 16 hours by the end of April 2011. The
mercury topped an unprecedented 30 degrees Celsius (86 degrees Fahrenheit) north of
the Arctic Circle on July 30 in Banak, Norway.
Ice begins melting in the Arctic as spring approaches in the northern hemisphere, and
then it usually starts building again toward the end of September as the days grow shorter
and cooler. A total of 5.7 million square kilometers (2.2 million square miles) of ice
covered the Arctic in July, according to the Colorado-based National Snow & Ice Data
Center. Through the first two weeks of August, ice extent declined by 65,000 square
kilometers each day, according to the NSIDC.
“The ice has been retreating by about 10 percent every decade during the last 30 years,”
said Miguel Angel Morales Maqueda, senior lecturer in Oceanography at Newcastle
University in northern England. “There is no other known explanation than climatic
change. If it isn’t climactic change, then we don’t know what it is.”
Arctic Expansion
Sea ice decline could allow some shipping routes to be passable year-round
Source: N. Melia et al. 2016

This season is likely headed for the the ninth biggest retreat since satellite
measurements began, not as extreme as bigger melting seasons in 2012 and 2007,
according to Julienne Stroeve, Professor of Polar Observation & Modelling, University
College London.
“The total ice extent loss is being slowed by winds pushing the ice southwards,” Stroeve
said in a message sent from an Arctic research trip. “We likely still have a month of sea
ice retreat. The ocean is still warm enough to melt some ice even if air temperatures
cool.”
LNG exporters are taking advantage of the open waters, most notably around the Yamal
LNG gas liquefaction plant in northern Siberia. The project owned by Total, Novatek and
their Chinese partners has custom-built ARC 7 tankers rugged enough to cut through
whatever ice remains in the area. That enables them to sail without help from
icebreakers west to Europe year round and east to Asia during the summer months. In
the coming years, more routes will open for ships to sail without an icebreaker.
Breaking the Ice
Number of ships using Northern Sea Route by flag state; Jan 1 - July 15, 2018
Source: Arctic Logistics Information Office
The Yamal venture’s Christophe de Margerie was the world’s first ice-breaking LNG
tanker built and collected Yamal’s first cargo to make the the trip westward through the
Northern Sea Route.
In early 2018 though, the Eduard Toll, became the first LNG tanker to ever use the full
Northern Sea Route in the winter. It traveled from a South Korean shipyard to Sabetta
and collected a cargo there from the Yamal LNG plant, then delivered it to France.
That shaved about 3,000 nautical miles off the traditional route through the Suez Canal.

In July China received two cargoes from Yamal from the first LNG ships to cross the
Arctic without help from ice breakers. The net voyage time from the port of Sabetta
through the Northern Sea Route to the destination the Chinese port of Jiangsu Rudong
was completed in 19 days, compared with 35 days for the traditional eastern route via
the Suez Canal and the Strait of Malacca.
Routes like that may save Yamal $46 million in shipping costs for the remainder of the
year, those savings could quadruple by 2023, Bloomberg NEF said in a note.
Melting Costs
Projected cost savings to Yamal using Northern Sea Route
Source: Bloomberg NEF
Projections based on Novatek's business plan on LNG production profile, NSR open for six months a year
Traffic is picking up. The Northern Sea Route saw 9.7 million tons of cargo shipped
through it in 2017, according to the Russian Federal Agency for Maritime and River
Transport. There were 615 voyages along the Northern Sea Route this year through July
15, about the same as in 2017, said Balmasov at Arctic Logistics. The Russian
government is targeting cargo traffic through that route totaling 80 million tons by 2024.
“The main difference to 2017 is LNG deliveries from the port of Sabetta,” Balmasov said.
“Our data show that as of early July, 34 tankers were dispatched from Sabetta towards
European ports, and one voyage was east-bound.”
Since then, two more ships have moved from Yamal to Asian markets in the east, though
the most icy part of the Northern Sea Route.

NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
The Editor :”Khaled Al Awadi” Your partner in Energy Services
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Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
Mobile: +97150-4822502
khdmohd@hawkenergy.net
khdmohd@hotmail.com
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 September 2018 K. Al Awadi

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