New base energy news 17 june 2019 issue no 1252 by khaled al awadi

Copyright © 2018 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
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NewBase Energy News 17 June 2019 - Issue No. 1252 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-funded project to provide strategic oil reserve for Kingdom
The Jordan Times
Prime Minister Omar Razzaz on Thursday inaugurated the Abu Dhabi-funded strategic
oil reserve facilities, designed to ensure energy self-sufficiency for the Kingdom for more
than one month.
Razzaz opened the $210-million project in the Madonah area with a holding capacity of
350,000 tonnes, the Jordan News Agency, Petra, reported.
The facilities, owned by the Jordan Oil Terminals Company (JOTC), will effectively
provide a strategic reserve of fuel for emergency cases, as well as upgrade the oil
sector’s infrastructure and create job opportunities for Jordanian technicians.
The storage facilities will provide a stockpile of diesel to cover the Kingdom’s demand
for 34 days, gasoline for 30 days, jet fuel for 34 days and liquefied petroleum gas for 16
days, according to Petra.
Razzaz said that the issue of energy has been arduous for the Kingdom due to its
location in a “fiery” region, citing the high costs Jordan incurred as a result of disruptions
to fuel supplies from Iraq and Egypt during critical times.
The premier expressed gratitude to the Emirati government and people, noting that this
cooperation reflects the “brotherly ties” between the two countries.

Highlighting the importance of the project, Razzaz said that the government aims to
increase the strategic reserve to cover the Kingdom's consumption for three months,
which is important for national security. “We are seeking to manage energy prices for
consumers and economic sectors,” he said, noting that renewable energy projects fall
within this goal.
Razzaz thanked the Jordanians
who worked on the establishment
of this project, and expressed
gratitude to Spain and Germany
for the expertise and technology
they contributed in the field.
Kholoud Mahasneh, JOTC’s
general manger, said that these
facilities aim at providing part of
the strategic reserve of oil
derivatives, noting that to secure
the additional needs, the
company has started with an
expansion project to be implemented within 30 months.
The JD20-million expansion includes three additional tanks of liquefied petroleum gas to
increase the stockpile to 16,000 tonnes, she added. Mohammed Suwaidi, the director
general of Abu Dhabi Fund for Development (ADFD), said that the fund has supported a
number of development projects in the Kingdom, in addition to the $210-million support
to the oil reserve facility, as part of a $1,250-billion grant pledged by the UAE to Jordan
in 2013.
The UAE supports Jordan’s development plans aimed at stimulating economic growth
and achieving sustainable development through funding the government’s high-priority
projects, he added. Razzaz toured the 400-dunum project, commending the advanced
level of the facilities, built within the highest international standards in the oil sector.
Minister of Energy and Mineral Resources Hala Zawati, in a press statement carried by
Petra, affirmed that this project fosters the country’s energy security within the energy
sector’s holistic strategy, aimed at maintaining stability in the market of oil derivatives
and reducing energy costs.
Founded in 2015, JOTC is a private shareholding company, wholly owned by the
government. JOTC serves two goals in Jordan’s energy sector: to guarantee the security
of Jordan’s oil supply, and to promote competition in the downstream petroleum market
through providing its services to customers according to the open-access principles on
a non-discriminatory basis, according to their website.

Oman: PDO moves to monetise flare gas
Oman Observere + NewBase
Petroleum Development Oman (PDO) says it has embarked on a strategy to monetise natural gas
that would otherwise be flared as part of its normal operations across its sprawling concession. For
every 1,000 tonnes of hydrocarbon produced last year.
The majority government-owned energy producer flared 17.91 tonnes of gas — representing a 22
per cent jump over flared volumes in 2017. The uptick, coming despite a vigorous flaring reduction
programme, was primarily attributed to “equipment failures in some fields”.
“We have developed comprehensive roadmaps to address both, and intend to reach the target of
zero routine flaring well before the World Bank’s 2030 deadline,” said Raoul Restucci, Managing
Director — PDO, referencing the company’s pledge to eliminate all flaring across its Block 6 licence
within the next decade. Flaring occurs when natural gas that is brought to the surface is burned off
in a controlled manner because it cannot be easily captured or used during normal upstream
hydrocarbon operations.
Still, flaring is generally seen as wasteful burning of a potentially valuable energy resource.
According to the World Bank, an estimated 140.6 billion cubic metres (bcm) (equivalent to 5 billion
MMBtu) of gas was flared in 2017. If harnessed and put to productive use, this volume would have
represented over $20 billion of value at current prices. Flaring also produces carbon dioxide — a
greenhouse gas that contributes to global warming. CO2 from flaring accounts for around 0.6 per
cent of anthropogenic greenhouse gas (GHG).

PDO aims to dramatically reduce the vast amounts of gas flared from more than 60 stacks
distributed across its operations in the Sultanate. Driving this effort is a commitment towards gas
conservation, as well as reducing GHG emissions in compliance with the Paris Accord on climate
change.
As a result of the increase in gas flaring and emissions from combustion sources in 2018, PDO’s
greenhouse gas emissions increased by 25 per cent, reaching 0.20 tonnes (CO2 equivalent) per
tonne of production compared to 0.16 tonnes of CO2 equivalent in 2017.
Seeking to rein in rising flare gas volumes and the resulting increase in GHG emissions, the
company has unveiled a number of initiatives, notably a “flare monetisation project” for all routine
flares.
“Last year, PDO developed and implemented a detailed gas flaring roadmap to address flaring
challenges within the organisation. This roadmap focuses on reduction of non-routine flaring,
implementation of flaring reduction projects and deployment of technological solutions,” it stated in
its newly published Sustainability Report 2018.
The company is also exploring partnerships with third party contractors in the implementation of
gas-to-power technology solutions designed to utilize all or part of the gas destined for flaring for
power generation.
One particular gas-to-power solution, based on micro-turbine technology, was successfully trialled
by PDO at its Anzauz facility. The successful deployment of this technology could see PDO
recovering around 500,000 cubic metres per day of flare gas across Block 6.

Japan is the world’s third-largest coal-importing country
Source: U.S. Energy Information Administration, International Energy Statistics
Japan imported more than 210 million short tons (MMst) of coal in 2018, making it the world’s third-
largest coal-importing country after only India and China. Japan continues to use steam coal to fuel
one-third of its electricity generation and metallurgical coal for raw steel production.
Japan imports nearly all (99%) of the coal it consumes. Australia is Japan’s primary coal supplier,
supplying 128 MMst, or 61%, of Japan’s demand in 2018. Indonesia (32 MMst), Russia (21 MMst),
the United States (13 MMst), and Canada (9.6 MMst) accounted for another 35% of total coal
imports. U.S. thermal coal exports to Japan increased by 20% in 2018, and 2019 exports as of
March are already 38% higher than in all of 2018.

Coal accounts for about one-third of Japan’s electricity generation. In 2018, Japan’s utilities
produced an estimated 317 billion kilowatthours of electricity at more than 90 coal-fired power
plants. Coal’s share of electricity generation in Japan was higher in 2018 than it was before the
2011 Fukushima nuclear accident. In 2010, coal accounted for 25% of Japan’s electricity
generation, and nuclear generation accounted for 29%.
Before 2011, Japan’s Ministry of Economy, Trade and Industry (METI) had planned to reduce coal’s
generation share by more than half by 2030, intending for nuclear power to offset coal plant
retirements.
The plan included increasing the nuclear generation share in Japan’s electricity mix to 50% by 2030.
However, as a result of the Fukushima accident and subsequent suspension of Japan’s nuclear
fleet, METI now projects a future energy mixof 20% to 22% nuclear, 22% to 24% renewables, 26%
coal, and 27% natural gas through 2030.
Japan’s utilities plan to construct 20 gigawatts (GW) of coal-fired electric power generation capacity
in the next decade. The scope of development will depend on how many suspended nuclear
reactors resume operation. Increased competition in Japan’s electricity market may also have an
effect as new non-coal entrants compete for market share.
New coal plant development also depends on whether the Japanese government will grant
environmental approvals to planned coal-fired power projects, given the country’s intention
to reduce carbon dioxide (CO2) emissions levels by 26% by 2030. The environmental approvals will
depend on several factors, including the plant’s proximity to population centers and the pace of
Japan’s CO2 emissions reduction efforts.
The Japanese government has promoted the development of more efficient coal-burning
technologies, such as ultra-supercritical coal-fired power (USC) plants, in an effort to meet
environmental goals. USC plants emit less carbon dioxide per unit of electricity generation than
traditional coal-fired plants, although their emissions are still nearly double that of natural gas plants.
METI is currently recommending that 50% of all coal-fired electricity generation come from USC
plants by 2030, and investors in Japan have begun to limit coal financing to high-efficiency coal
projects instead of traditional designs.

Monthly U.S. crude oil imports from OPEC fall to a 30-year low
Source: U.S. Energy Information Administration, Petroleum Supply Monthly
U.S. imports of crude oil from members of the Organization of the Petroleum Exporting Countries
(OPEC) in March 2019 totaled 1.5 million barrels per day (b/d), their lowest level since March 1986,
based on data in EIA’s Petroleum Supply Monthly. U.S. crude oil imports from OPEC members have
generally fallen over the previous decade as domestic crude oil production has increased.
From the early 1980s through the late 2000s, OPEC member countries were the source of about
half of all U.S. crude oil imports. In the past decade, however, total U.S. crude oil imports have fallen
and OPEC’s share of those imports has decreased. Non-OPEC countries such as Canada, Mexico,
Brazil, and Colombia have made up larger shares of U.S. crude oil imports. In each of the past four
years, Canada alone has supplied more crude oil to the United States than all OPEC members
combined.

Through the first three months of 2019, U.S. crude oil imports from OPEC members Venezuela and
Iraq have fallen the most. In 2018, Venezuela was the source of 505,000 b/d of U.S. crude oil
imports, or 20% of the OPEC total.
In March, the United States imported just 47,000 b/d of crude oil from Venezuela. Preliminary weekly
import valuesshow several weeks in March and May when the United States imported no crude oil
from Venezuela.
U.S. sanctions directed at Venezuela's energy sector generally and Petróleos de Venezuela, S.A.
specifically have driven U.S. imports from Venezuela to recent low levels. Before the United States
imposed the sanctions, U.S. imports had been declining as long-term mismanagement of
Venezuela’s oil industry, and widespread power outages since the beginning of this year have led
to significant declines in Venezuelan crude oil production.
U.S. crude oil imports from other OPEC members also declined following a November 2016
agreement by OPEC members and a number of non-OPEC producers to cut crude oil production.
As a result of the production cuts, many OPEC members reduced exports to the United States in
favor of growing markets in Asia. In the first three months of 2019, the volume of U.S. crude oil
imports from Saudi Arabia and Iraq—the two largest sources of imports from OPEC in 2018—have
averaged 26% and 28% below their 2018 average levels.
In 2018, the U.S. Gulf Coast region (defined as Petroleum Administration for Defense District 3)
imported 1.4 million b/d of OPEC crude oil, or 55% of the national total of OPEC imports. With the
recent decline, the U.S. Gulf Coast imported just 513,000 b/d from OPEC in March 2019.

U.S. Gulf Coast imports of OPEC crude oil in March were below those for the West Coast region,
marking the first time on record that the Gulf Coast region was not the predominant import area of
OPEC crude oil in the United States.
For total crude oil imports, the Midwest (defined as Petroleum Administration for Defense District 2)
has received more crude oil than the Gulf Coast in every month from November 2018 through March
2019, the latest available monthly value. Nearly all of the Midwest’s crude oil imports come from
Canada.
Source: U.S. Energy Information Administration, Petroleum Supply Monthly
The decline in Gulf Coast crude oil imports and the recent rise in crude oil exports has led the Gulf
Coast region to be a net exporter of crude oil in every month from November 2018 through March
2019. More than 90% of the U.S. crude oil exported since the start of 2018 has been shipped from
Gulf Coast ports.
A recent This Week in Petroleum analysis provides more insight on recent changes and long-term
trends in Gulf Coast crude oil supply.

NewBase June 17 – 2019 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Oil prices slip as economic worries outweigh tanker tensions
Reuters + NewBase + Bloomberg
Oil prices slipped on Monday as signs of an economic slowdown amid international trade disputes
began to outweigh supply fears that were stoked by attacks on oil tankers in the Gulf of Oman last
week and sent prices higher.
Brent futures fell 19 cents, or 0.31%, to $61.82 a barrel by 10.36 GMT, having gained 1.1% on
Friday. U.S. West Texas Intermediate (WTI) crude futures were down 22 cents, or 0.4%, at $52.29,
having firmed by 0.4% in the previous session.
“China’s industrial output growth (is) falling to the lowest level in 17 years amid trade tensions with
the U.S. Today, oil markets will have to digest more demand concerns as India implemented
retaliatory tariffs on a number of U.S. goods yesterday,” consultancy JBC Energy said in a note.
Oil price special
coverage

Also sapping prices was the dim outlook for oil demand growth in 2019 projected by the International
Energy Agency (IEA) on Friday, citing worsening prospects for global trade.
The Paris-based IEA’s 2019 demand growth estimate was revised downwards by 100,000 barrels
to 1.2 million barrels per day (bpd) but said the picture would improve going into 2020 thanks to
stimulus packages and growth in developing countries.
Though danger of an immediate confrontation over last week’s tanker attacks - which the United
States blamed on Iran but Tehran denied - appeared to recede, tensions over the strategic route
remain high. A fifth of the world’s oil passes through the Strait of Hormuz.
U.S. Secretary of State Mike Pompeo on Sunday said that Washington does not want to go to war
with Iran but will take every action necessary, including diplomacy, to guarantee safe navigation in
the Middle East.
Prices could receive some support from comments by Saudi energy minister Khalid al-Falih over
the weekend that OPEC would probably meet in the first week of July and that he hoped it would
reach an agreement on extending oil output curbs.
“We are hoping that we will reach consensus to extend our agreement when we meet in two weeks’
time in Vienna,” Falih told reporters while
attending a G20 energy and
environment ministerial meeting in
Karuizawa, northwest of Tokyo.
The Organization of the Petroleum
Exporting Countries plus Russia and
other producers, have a deal to cut
output by 1.2 million bpd from Jan. 1.
The pact ends this month and the group
meets in the coming weeks to decide its
next move.
Oil Supply to Swamp Demand, Squeeze OPEC in 2020, IEA Says
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Global oil supplies will increase far more than demand next year with the start of a host of new
projects, putting further pressure on the OPEC cartel, the International Energy Agency said.
Even though growth in world oil demand will accelerate to 1.4 million barrels a day in 2020, it will be
eclipsed by a 2.3 million barrel-a-day surge in output, as the ongoing boom in U.S. shale is
augmented by new fields in Brazil, Norway and Canada.
As a result, the world will need significantly less crude from the Organization of Petroleum Exporting
Countries, the IEA, which advises most major economies, predicted in its monthly report on Friday.
Though Saudi Arabia and its allies have been deliberately cutting supply this year, and political
crises have crushed exports from Venezuela and Iran, OPEC is pumping much more oil than will
be required in 2020.
“A clear message from our first look at 2020 is that there is plenty of non-OPEC supply growth
available to meet any likely level of demand, assuming no major geopolitical shock,” said the Paris-

based IEA. “This is welcome news for consumers and the wider health of the currently vulnerable
global economy, as it will limit significant upward pressure on oil prices.”
The Big Squeeze
Non-OPEC supply growth outstrips demand, reducing the market for the cartel's oil
Source: International Energy Agency
Oil in New York moved into a bear market last week and Brent sunk below $60 a barrel in London
for the first time since January on concern that a slowdown in the global economy -- exacerbated
by the ongoing trade war between the U.S. and China -- will hurt fuel consumption around the world.
OPEC will meet in the coming weeks to decide its response.
The IEA report showed that the fears about demand are coming to fruition.
Global oil demand grew by 300,000 barrels a day during the first quarter, the weakest since 2011,
as developing nations only just offset a drop in developed economies. The agency lowered growth
estimates for 2019 as a whole for a second consecutive month, by 100,000 barrels a day.
For the rest of this year and into 2020, however, the IEA expects that demand will pick up markedly,
averaging 1.2% in 2019 as a whole and 1.4% next year. That rebound assumes some progress in
the trade stand-off between the U.S. and China, it said.
Even with its optimistic outlook for the economy, the agency sees growth in oil consumption being
drowned by new supplies next year.
Fracking Boom
About half of the supply expansion will be provided by the U.S., which has been transformed by the
fracking boom in Texas and North Dakota into the world’s biggest crude producer. But unlike in
previous years, growth in America is being supplemented by significant gains elsewhere, such as
in Norway and Brazil.

That may make for painful reading for the Saudis and other OPEC nations, who together pump 40%
of the world’s oil.
The demand for their crude will slump for a third consecutive year, to 29.3 million barrels a day.
That’s about 650,000 barrels a day less than the 14 OPEC nations pumped last month, when their
supply was already significantly reduced as a result of a pact to restrain output, as well as by U.S.
sanctions on Venezuela and Iran. Iran’s production fell to 2.4 million barrels a day, the lowest since
the 1980s.
The organization and its allies are due to meet in the next few weeks to decide whether to keep
going with their agreement to reduce output. Saudi Arabia, OPEC’s biggest member, has
recommended persevering.
If OPEC reduces output next year to the levels the IEA considers necessary, production would be
the lowest since 2003 -- suggesting that its strategy to support oil markets has backfired.

NewBase Special Coverage
News Agencies News Release June 17-2019
BP Statistical Review of World Energy 2019: an unsustainable path
Source: BP
BP has released the 68th annual edition of the BP Statistical Review of World Energy (BP Stats
Review), the most comprehensive collection and analysis of global energy data. This year's edition
highlights the growing divergence between demands for action on climate change and the actual
pace of progress on reducing carbon emissions.
Key findings from the BP Stats Review 2019 include:
 Global energy demand grew by 2.9% and carbon emissions grew by 2.0% in 2018, faster
than at any time since 2010-11.

 Natural gas consumption and production was up over 5%, one of the strongest rates of
growth for both demand and output for over 30 years.
 Renewables grew by 14.5%, nearing their record-breaking increase in 2017, but this still
accounted for only around a third of the increase in total power generation.
 Coal consumption (+1.4%) and production (+4.3%) increased for the second year in a row in
2018, following three years of decline (2014-16).
(annual change, bcm)
Natural gas – largest annual increases in gas
production (bcm)
Growth in power generation
– contributions by region
(annual change, %)
Growth in power
generation –
contributions by fuel
(annual change, %)

 The United States recorded the largest-ever annual production increases by any country for
both oil and natural gas, the vast majority of increases coming from onshore shale plays.
Introducing the findings for 2018, Spencer Dale, BP chief economist, said:
'There is a growing mismatch between societal demands for action on climate change and the actual
pace of progress, with energy demand and carbon emissions growing at their fastest rate for years.
The world is on an unsustainable path.'
'The longer carbon emissions continue to rise, the harder and more costly will be the necessary
eventual adjustment to net-zero carbon emissions,' concluded Bob Dudley, BP group chief
executive. 'As I have said before, this is not a race to renewables, but a race to reduce carbon
emissions across many fronts.'
The BP Statistical Review of World Energy and other related materials are available online at www.bp.com/statisticalreview.

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
NewBase energy news is produced daily (Sunday to Thursday) and
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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 June 2019 K. Al Awadi

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