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NewBase Energy News 19 November 2019 - Issue No. 1296 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: How oil and gas is enabling the UAE's shift to a
knowledge-led economy
The national
For more than 40 years, Adnoc and the oil and gas sector have been critical to the development of
the UAE and its economic diversification efforts. Since oil prices slumped in 2016, Adnoc has
undergone a transformation to ensure that the return on every barrel of oil produced is maximised.
This will allow for the continued contribution from the oil and gas sector amid a shift to a
knowledge-led economy.
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 2
l
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 3
Dubai Supreme Council of Energy reviews work progress on
Demand Side Management Strategy.. © Copyright Emirates News Agency (WAM) 2019.
Demand Side Management Strategy aims to reduce the demand for electricity and water by 30%
by 2030
DUBAI - H.H. Sheikh Ahmed bin Saeed Al Maktoum, Chairman of the Dubai Supreme Council of
Energy, held the 57th meeting of the council in the presence of Saeed Mohammed Al Tayer, Vice
Chairman of the Dubai Supreme Council of Energy, where they discussed the work progress on
the Demand Side Management Strategy, which aims to reduce the demand for electricity and
water by 30 percent by 2030.
Attendees at the council meeting included Ahmed Buti Al Muhairbi, Secretary-General of
the Dubai Supreme Council of Energy, and the council's board members, including Dawood Al
Hajri, Director-General of Dubai Municipality; Abdullah bin Kalban, CEO and MD of Emirates
Global Aluminium; Saif Humaid Al Falasi, Group CEO of ENOC; Waleed Salman, Vice Chairman
of Dubai Nuclear Energy Committee; Nasser Abu Shehab, CEO of RTA’s Strategy and Corporate
Governance Sector; and Frederic Chemin, General Manager at Dubai Petroleum.
The meeting also discussed
the Dubai Green Mobility
Strategy 2030 to increase the
number of hybrid and electric
vehicles in the market and
raise their proportion to 10
percent by 2030. It addressed
the work progress of
the Etihad Energy Services
Company's projects for Shams
Dubai, Emiratisation, and
advancing the capabilities of
Emiratis in the Supreme
Council’s organisations.
"We support the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice
President, Prime Minister and Ruler of Dubai, to transform into a green economy," Al Tayer, said
adding, "The meeting discussed the Etihad ESCO projects that depend on the Standards and
Regulations of the Shams Dubai initiative.
The Dubai Electricity and Water Authority, DEWA, launched Shams Dubai to encourage
household and building owners to install photovoltaic panels to generate electricity and connect
them to the DEWA's grid. The meeting reviewed the progress of this initiative for government
buildings. The DEWA has installed 10 percent so far, and intends to install another 10 percent by
2020."
"During the meeting, we discussed the RTA’s initiative to speed up the transformation into green
mobility. The initiative aims to transform 90 percent of limousines operating in Dubai into
environmental-friendly vehicles (hybrid/electric) by 2026, starting from 2020. The RTA will ensure
more hybrid and electric cars into its limousine fleet to reduce 45 percent of carbon emissions to
support the Dubai Green Mobility Strategy," Al Muhairbi said.
Saudi Aramco’s Mammoth Share Sale Stacks Up in Five Charts
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
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Bloomberg - Filipe Pacheco
Saudi Arabia put a valuation on oil giant Aramco of between $1.6 trillion and $1.71 trillion, well
below the $2 trillion target sought by Crown Prince Mohammed bin Salman since he first touted
the deal in 2016.
The kingdom will list only 1.5% of the company on the Tadawul and the offering will mainly target
local investors. If shares price at 32 Saudi riyals ($8.53) -- the high end of the range -- it will just
beat Alibaba Group Holding Ltd. to the title of the world’s biggest IPO.
World's Biggest IPO?
At the top of the range, Aramco's IPO would be bigger than Alibaba's
* World record IPO; Source: Bloomberg
At the lower end of 30 riyals, Aramco will still be more than three times bigger than the entire
Saudi stock market. A poll of 24 money managers by Bloomberg News shows more than 40% put
the company’s fair range at $1.2 trillion to $1.5 trillion.
Way Bigger
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Even at the lower end of range, Aramco would dwarf the Saudi market
Source: Aramco, Bloomberg
*The market capitalization as of Nov. 16
The new valuation implies Aramco, which has promised a dividend of at least $75 billion next
year, will reward investors with a yield of between 4.4% and 4.7%. That compares with just under
5% for Exxon Mobil and 6.4% for Shell.
At this rate, it would dwarf last year’s payouts from the 80 listed firms on the Saudi bourse that
paid dividends, according to data compiled by Bloomberg. Investors who buy into the IPO have
been guaranteed that the dividend won’t fall until after 2024.
That’s the big question. Prince Mohammed caused something of a shock in 2016 when he first
announced the plan and estimated the oil giant’s valuation at $2 trillion. That’s almost twice the
size of Microsoft Corp., the world’s most valuable listed company.
Some equity analysts put the number closer to $1.5 trillion. (Bloomberg Intelligence estimates
$1.1 trillion.) A clearer picture should emerge when analysts publish reports on the IPO this
month.
Giant Dividend
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Aramco's dividend versus what 80 companies listed in Riyadh paid last year
Source: Aramco, Tadawul, Bloomberg
*Does not include Real Estate Investment Trusts
No matter what the final valuation, the share sale will create a public company of unmatched
profitability. Aramco earned a net income of $111 billion in 2018 on revenue of $315 billion. It
pumps about 10% of the world’s oil from giant fields under the kingdom’s deserts.
Aramco makes more money than any other company, but investors may balk if the valuation is set
too high, particularly given the political risk. To lure investors, the authorities are reshaping the oil
producers’ finances (most of its revenue goes in taxes and royalties to the government) as well as
promising bumper dividends.
For instance, the royalty it pays for Brent crude prices below $70 a barrel is falling to 15% from
20%. The “base dividend” in 2020 will be $75 billion -- much bigger in magnitude than other oil
giants pay but a good deal smaller in terms of yield.
Profit King
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Saudi Aramco’s profit = Apple + Google + Exxon Mobil
Source: Moody's Investors Service, Bloomberg
The company is so big, investors and analysts were concerned it could drain liquidity from the
Saudi market. In recent months, many analysts have said that local investors -- key for a
successful deal -- were offloading some of their portfolio to buy Aramco shares.
The Tadawul All Share Index has under performed emerging markets as the Saudi government
accelerated preparations for the IPO. The index, which finished little changed on Sunday, has
retreated 1.1% since Aug. 29, compared with an 8.1% increase for the MSCI Emerging Markets
Index.
IPO price range values company at up to $1.7 trillion
The company is offering individual and institutional investors 1.5 per cent of its shares at a price range of
30 to 32 Saudi riyals a share.
Saudi Aramco is offering retail and institutional investors a 1.5 per cent stake in an initial public
offering on the kingdom's benchmark Tadawul index, valuing the company between $1.6 trillion
and $1.7tn (Dh5.9tn to Dh6.2tn) and making it potentially the world's largest listing to date.
The price range for the offering has been set at 30 Saudi riyals to 32 riyals a share, the company
said on Sunday. Aramco will issue two hundred billion shares.
The final offer price will be determined at the end of the book-building period, which is December
4, according to the company. Individual investors will subscribe based on a price of 32 Saudi
riyals, which is the top end of the price range.
If the final offer price is below 32 riyals, individual investors can, in respect to the difference
between the highest price on offer and the final price, elect to have the surplus subscription
amount refunded in cash as credit to their account or be considered for an allotment of
additional shares, the company said.
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
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Aramco, the most profitable commercial entity in the world, outshining the likes of Apple, Google
and Amazon, recorded a $68 billion profit for the first nine months of the year and may eclipse the
listing of China's Alibaba in 2014 that raised $25bn on the New York Stock Exchange. In April,
Aramco issued a debut $10bn bond, which was hugely oversubscribed.
Aramco is the largest integrated oil and gas company in the world, producing one in every eight
barrels of crude. In 2018, the company produced 13.6 million barrels per day of oil equivalent,
including 10.3 million bpd of crude.
The company kicked off the IPO process on November 3, confirming its intention to float its shares
on Saudi Arabia's Tadawul stock exchange, the Arab world's largest market. After the initial listing
on Tadawul, Aramco is expected to carry out a secondary listing on an international exchange.
“Saudi Aramco's forthcoming IPO on the Saudi Stock Exchange could enable the sovereign to
further strengthen its net asset position,” S&P Global Ratings said in a note. “And, if subsequently
effectively deployed, the funds raised could be used to support longer-term economic growth in
Saudi Arabia.”
The bulk of the funds raised are expected to to the government or the Public Investment Fund,
potentially adding to the sovereign's already strong fiscal net asset position of 72.7 per cent of
gross domestic product, S&P said.
The ratings agency also said "as a result of the recent bond and forthcoming equity offerings,
there has been an increase in financial and operating disclosures", which is supportive for
investors. "The IPO will also help to benchmark Saudi Aramco against regional and global peers."
The Aramco IPO is central to Riyadh's ambitions to transform the kingdom's economy. Funds from
the share float are also expected to boost spending on Vision 2030 projects such as the $500bn
futuristic economic free zone Neom and the Red Sea Project, a mega-tourism attraction. The
country is aiming to open up its tourism and entertainment sector.
Aramco Failure to Win Foreign Money Makes IPO Local Event
Bloomberg - Javier Blas
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Two ye- ars ago, when the initial public offering of Saudi oil giant Aramco held the imagination of
foreign investors, President Donald Trump felt compelled to publicly lobby for the share sale to
happen in America.
Today Saudi Aramco isn’t just shunning New York -- and other international exchanges -- as a
listing venue, but has decided it won’t even market the IPO to American, Canadian, European or
Japanese investors. Instead, Aramco plans to rely heavily on ultra-wealthy Saudis, many of whom
have been pressed to invest, to get the deal done. Saudi banks are loosening lending regulations
to allow locals to buy more shares.
The IPO once was promoted as the strongest sign of economic change in Saudi Arabia: the deal
that was going to attract tens of billions of foreign capital into the kingdom. Instead, a slimmed
down share sale is starting to look more like a levy on the country’s economy as Saudi investors,
large and small, take the place of foreign money managers.
It may well still be the world’s largest IPO, perhaps raising about $25 billion and valuing the
company at $1.6 trillion to $1.7 trillion, well above the biggest names of Silicon Valley. But that’s
short of the $100 billion that Saudi Crown Prince Mohammed bin Salman said he was hoping to
raise when he first mooted the IPO in 2016. At that point, he targeted a valuation of at least $2
trillion.
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
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“Saudi Arabia has been moving the IPO toward becoming more focused on regional investors for
a while,” Ayham Kamel, Middle East practice head at consultant Eurasia Group. “Western demand
was going to be lukewarm given the valuation and the geopolitical risk.”
So poor is the international appetite for the deal, even at the lower valuation, Saudi Aramco
decided at the last minute against marketing the IPO in the U.S., Canada and Japan -- three
markets traditionally seen as a must-go destination for any big Wall Street deal. Instead of the
planned approach to American investors, using what lawyers and bankers know as the 144A rule
of the U.S. Securities Act, Aramco decided on Sunday the tepid interest meant it wasn’t worth the
trouble.
The array of Wall Street banks, including Goldman Sachs Group Inc, Morgan Stanley and
JPMorgan Chase & Co, with mandates to sell the stock to international investors, were taken
aback by the sudden decision, according to people familiar with the matter, who asked not to be
named discussing private conversations.
Skipping the U.S. means saying goodbye to powerful American pension funds with billions of
dollars managed from cities like Boston and Los Angeles.
On Monday, Aramco’s banks told investors in London and other European cities that roadshow
events planned for this week had been canceled.
In a sign of Aramco’s shifting ambitions, the company published an English version of the updated
prospectus more than 24 hours after the Arabic version posted the target price range early on
Sunday.
“The valuation range is higher than most institutional investors would consider attractive,” said Neil
Beveridge, analyst at Sanford C. Bernstein & Co. “Aramco’s price range would imply a premium
valuation to western oil majors on almost every valuation metric.”
The new valuation implies Aramco, which has promised a dividend of at least $75 billion next
year, will reward investors with a dividend yield of between 4.4% and 4.7%, below what other oil
majors pay. Exxon Mobil Corp. pays a dividend yield of just under 5%, while Royal Dutch Shell Plc
pays 6.4%.
The difference between local and foreign investors is that Prince Mohammed, the country’s day-
to-day ruler, has leverage at home. Overseas, he has almost none.
Many of the rich Saudi families that will now become key investors in Aramco learned the
ruthlessness of Prince Mohammed during the crackdown that saw many arrested in the Ritz
Carlton hotel in Riyadh in 2017. Prince Mohammed also controls the local banking industry, which
will lend billions of dollars to Saudi retail investors to buy shares.
Despite the tepid interest overseas, the 34-year-old Prince Mohammed is all but sure to get the
job done -- even if the result falls short of his original ambitions. As well as a lower valuation
between $1.6 and $1.7 trillion, it won’t be the 5% of company’s capital he envisioned. Instead just
1.5% will be offered.
The combination of a lower valuation and a smaller stake means that there will almost certainly be
enough Saudi money to buy the shares – and perhaps guarantee reasonable post-IPO trading --
but the sale will be a long way from the seismic global financial event Prince Mohammed touted in
back in 2016.
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 11
Oman: Oilfield casing accessories manufacturing plant launched
Oman Observer
Omani oilfield services firm Gulf Energy SAOC opened on Sunday its first cementing casing
accessories manufacturing facility in the Sultanate to support Petroleum Development Oman’s
(PDO) operations and other customers in Oman and the GCC region.
The main objective of this investment is to boost the Omani economy by creating more jobs and
training opportunities, saving costs and enabling custom-made solutions and adequate lead-time
delivery of goods and services.
Complementing PDO’s In-
Country Value strategy, the
centre, located in Nizwa, will
support PDO’s operations by
locally manufacturing
cementing casing
accessories and associated
services including
centralisers, stop collars and
floats equipment.
Established in an area of
over 9,600 square metres,
the complex has over 1,400
m2 allocated for workshops.
Underlining Gulf Energy’s commitment to promote localisation, the $2.4 million facility achieves
about 92 per cent Omanisation by creating 24 jobs for Omanis so far.
PDO Well Engineering Contracts Manager Salman al Maimani said: “In addition to supporting
existing projects of Gulf Energy with PDO, this new facility in Nizwa can also support other
customers in the country and wider region, underscoring the added value Gulf Energy is bringing
to the oil and gas supply chain in Oman.
“At the same time, this plant further reinforces PDO’s own localisation efforts and In-Country
Value strategy which aims to create more jobs, training and learning opportunities for Omanis and
enhance domestic supply chains. The facility will provide efficiencies to PDO as well as minimise
any delays in equipment delivery and installation.”
The opening of the facility, under the auspices of Salim bin Nasser al Aufi, Under-Secretary of the
Ministry of Oil and Gas, marks the completion of another of the opportunities outlined in the
Ministry of Oil and Gas ICV strategic blueprint which was unveiled in 2013. PDO is leading on 43
out of the 53 originally unveiled to Oman’s oil and gas industry.
Vice President of Gulf Energy SAOC in Oman Sultan al Ghafri said: ‘’We are pleased to expand
our manufacturing activities in Oman and enhance the In-Country Value of our business. We
believe in Omani talents and are committed to contributing to the Omani economy throughout the
value chain. The new facility will allow us to expand on hiring and training local talents and
providing the industry with excellent casing accessories made in Oman.”
He added: “I would like to thank PDO for their support of Gulf Energy, an Omani National
Champion for the region, and we look forward to delivering top quality, locally designed and
produced products to the region.”
NOVEMBER 18, 2019
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or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
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U.S.A: EIA's Heating Oil and Propane Update shows lower
prices so far this winter Source: U.S. EIA, Heating Oil and Propane Update (HOPU)
According to the U.S. Energy Information Administration’s (EIA) Heating Oil and Propane
Update (HOPU), prices at the start of the 2019–2020 winter heating season (October 1 through
March 31) were 10% lower for heating oil and 22% lower for propane than at the start of the
previous winter.
HOPU is published as part of the State Heating Oil and Propane Program (SHOPP), a joint effort
between EIA and several state energy offices to collect state-level residential heating oil and
propane price data from October through March in states where heating oil and propane use is
common.
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
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According to the U.S. Census Bureau’s 2018 American Community Survey, distillate heating oil is
the primary home heating fuel in 4.6% of U.S. homes and tends to be more common in the
Northeast. Propane is the primary heating fuel in 4.8% of U.S. homes. Propane as a primary
heating fuel tends to be more common in the Midwest.
Source: U.S. Energy Information Administration, based on U.S. Census Bureau American Community Survey 2018
SHOPP collects residential heating oil and propane prices for 21 states. In 18 additional states,
only propane prices are collected; in the District of Columbia, only heating oil prices are collected.
SHOPP also provides wholesale heating oil prices for 25 states and propane prices for 23 states.
Stakeholders and analysts use these state-level heating oil and propane prices and region-level
inventories to monitor markets as well as to facilitate emergency response to fuel supply
shortages during winter months.
To improve the accuracy of the state-level prices, EIA selected two new samples for residential
heating oil and propane prices and implemented a new sampling methodology in October 2019.
EIA is also now publishing standard errors for SHOPP price estimates, which allow data users to
compute a confidence interval around the corresponding average price estimate.
Weekly SHOPP price data are available each Wednesday at 1:00 p.m. Eastern Time on
the Winter Heating Fuels and Heating Oil and Propane Update web pages.
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
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NewBase 19 November 2019 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Oil falls 2% on oversupply fears, trade talk concerns
Reuters + NewBase
Oil fell about 2% on Tuesday on concerns about excess global crude supply and limited progress
toward resolving a U.S.-China trade dispute that has clouded the outlook for oil demand.
Brent crude LCOc1 futures fell $1.31, or 2.1%, to $61.13 a barrel by 12:53 p.m. EST (1753 GMT).
U.S. West Texas Intermediate (WTI) crude CLc1 futures lost $1.47, or 2.6%, to $55.58 a barrel.
Brent has rallied about 15% this year, supported by a pact by the Organization of the Petroleum
Exporting Countries and its allies, including Russia - a group known as OPEC+ - to cut combined
oil output by 1.2 million barrels per day from Jan. 1.
Russia is unlikely to agree to deepen cuts in oil output at a meeting with fellow exporters next
month, but could commit to extend existing curbs to support Saudi Arabia, three sources said.
OPEC and its allies will consider whether to deepen cuts to crude supply when they next meet in
December due to worries about weak demand growth in 2020, sources from the oil-producing club said.
Oil price special
coverage
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or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 15
“We expect uneasy talks in December. Russia will not categorically agree to (deepen) cuts in
winter,” a source familiar with the matter said. The news on Russia’s stance sent oil prices lower
as investors worried about potential oversupply.
“Moreover, Russia also failed to fulfill its agreed cuts in November so far,” Commerzbank analyst
Carsten Fritsch said. Further weighing on prices, a Chinese government source was quoted by
CNBC on Monday as saying there was gloom in Beijing about prospects for a trade deal. The
long-running dispute has hit economic growth prospects.
“The less than promising reports coming from China on the trade war may have taken some of the
energy out of the rally,” said Craig Erlam, analyst at brokerage OANDA. “We’re certainly seeing
less momentum in the recent rallies.”
Oil prices were also hit by a larger-than-expected rise in Norwegian oil production and the
prospect of a further increase in U.S. crude inventories, suggesting ample supplies.
Norway’s production rose in October to beat the official forecast as output from the Johan
Sverdrup field began ahead of schedule. This is the largest field to come on stream in the North
Sea - home of the Brent contract - for years.
The average estimate from six analysts polled by Reuters was for U.S. crude inventories to have
risen by about 1.1 million barrels last week, representing a fourth consecutive weekly gain. The
American Petroleum Institute releases its supply report at 4:30 p.m. EST (2130 GMT) on Tuesday
and the government’s official figures are due on Wednesday.
Oil found some support from tension in the Middle East, home to top exporter Saudi
Arabia and other core OPEC members. Protesters in Iraq blocked a commodities
port on Tuesday.
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or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 16
NewBase Special Coverage
News Agencies News Release 19 August 2019
Electric-Car Onset Leaves Lubricant Industry Facing Kodak’s Fate
Bloomberg - Andrew Marc Noel + NewBase
The $146 billion lubricants industry is at risk of suffering the same fate as Kodak, thanks to the
rise of electric vehicles.
From Volkswagen AG to Nissan Motor Co., carmakers are switching to battery-powered models
that use fewer greases than combustion vehicles. With demand expected to decline from 2025,
lubricant makers are wary of Eastman Kodak’s demise when it failed to grasp the potential of the
digital camera in the 1970s.
For decades, lubricant makers have been preoccupied with squeezing more fuel efficiency from
combustion engines and increasing the mileage between oil changes. EVs present a new set of
challenges to their piston counterparts that typically use 40 different oils. They need a grease that
can cool and lubricate the motor, while also protecting the electronics on-board and being
compatible with non-metal materials like plastics.
“I’m very conscious of the world changing,” said Dave Hall, a 30-year industry veteran who is
overhauling BP Plc’s line-up of Castrol lubricants for the EV market. “I’d like to think we’re trying to
address and prevent a Kodak moment and not just lock it away in a cupboard as maybe they did.”
Motoring Ahead
Electric vehicles are expected to make up most new vehicle sales by 2040
Source: Bloomberg NEF
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or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
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With the current crop of electric cars in circulation, attention has largely been on battery
performance and design, with lubricants an afterthought. Some EVs use standard greases found
in combustion engines, according to Lutz Lindemann, chief technology officer at Fuchs Petrolub
SE.
There are signs the pressure is already poised to affect companies. Demand for automotive
lubricants, which reached about 20 million tons last year, is supposed to be flat for the
“foreseeable future” due to the impact of EVs, the growing use of synthetic lubricants and
economic pressures, according to research from energy consultant Kline & Company.
No Cliff Edge
Other oil majors, who are fighting the effects of the push to de-carbonize on multiple fronts, have
also focused on creating new products. Royal Dutch Shell Plc, the largest global supplier of
finished lubricants, has developed a line of fluids engineered specifically for the high-tech
powertrains of hybrids and EVs. Total SA launched two brands of lubricants for EVs last year,
while Petronas announced its own EV brand this year.
Like Castrol, Fuchs has created a dedicated international team of managers and researchers
solely focused on developing and marketing lubricants for EVs, Lindemann said. With carmakers
desperate to extend the range, coming up with a new formula capable of a 1% gain in efficiency
could boost driving range by 4 miles, BP’s Hall said.
Driven by penetration of EVs in China and Europe, sales volumes in the lubricants market could
start to decline as early as 2025, according to Bank of Merrill Lynch analyst Jean-Baptiste
Rolland. He estimates battery electric vehicles require 50% to 70% less in greases than internal
combustion engines.
“The bottom line is the volumes are not going to make up the loss that we’re going to see from the
engine oil going away,” said George Morvey, industry manager for the energy practice at Kline.
Both Morvey and Fuchs’ Lindemann said the silver lining is the industry sees the disruption ahead,
and has a long time to respond to it. There’ll be no cliff edge given the number of combustion
vehicles in China alone is set to jump, to 350 million in 10 years’ time from 260 million now,
Lindemann said. Plus developing specialist high-performance lubricants for battery vehicles will
result in more-profitable sales, he added.
Lindemann said the lubricants value in a BEV is “probably 90%” of a combustion car. “We just
don’t really know for sure but it’s not a dramatic disaster for us,” he said. “There’ll be a significant
decrease in volume but not.
DO ELECTRIC CARS USE OIL?
Electric cars do not use oil in the same way that
Internal Combustion Engine (ICE) cars do. Typically
an ICE car uses oil to lubricate all the moving parts
within the engine and to keep everything working. An
electric car does use grease, which technically is an
oil-based substance and provides lubrication to
bearings in some electric motors.
An oil change is required for electric cars that have a
single speed gearbox, the oil is normally sealed
within the transmission and will be changed by the
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 18
manufacturer. It’s best to check with your manufacturer what the servicing requirements are and
when the change is needed.
Generally, most electric cars do not need an oil change in the same way that an ICE car does, this
is because no oil is required to lubricate the engine. Electric motors are very efficient and there is
not as much loss of energy creating heat, which cannot be said for an ICE. Electric motors have a
small amount of moving parts, typically there is a rotor and a stator. In an electric motor, the stator
creates a rotating magnetic field to move the rotor.
DO ELECTRIC CARS NEED COOLANT?
Some electric cars do need coolant, especially if they have a thermal management system within
the car for cooling the batteries. A thermal management system is essentially the cars way of
managing battery temperatures.
For cooling the batteries the coolant is circulated around the battery packs to lower the
temperature. Batteries have an optimal temperature they work best at, and overheating can cause
degradation. Similarly colder temperatures can limit the speeds you can charge your car at,
especially if the battery pack is cold.
The solution of Tesla, in this case, is to use a resistance heater in the model S and X to heat the
battery pack to an optimal temperature. Not only does this allow for normal charging speeds, but it
also restores some of the range of the car which is temporarily lost due to cold batteries.
If you are buying an electric car for the long term it’s a good idea to purchase one with a thermal
management system. This also has other names such as a battery management system or BMS
for short. The reason for this is that your batteries will be kept in a more optimal temperature
which helps to decrease degradation.
Some cars on the market do not offer this and instead have passive cooling where the outside air
is used to cool the batteries. In some cases this will not be as effective as a BMS and over the
longer term these cars will suffer greater battery degradation than those with a BMS in my opinion.
DO ELECTRIC CARS USE TRANSMISSION FLUID?
Transmission fluid is used in an electric car but as mentioned before it’s in a sealed unit. Typically
this will not need to be changed as often as an ICE car because no gears are actually being
changed. When the car wants to go in reverse the electric motor spins backward and when neutral
is selected the electric motor stops spinning.
DO ELECTRIC CARS NEED ANTIFREEZE?
Since an electric motor within an electric car works very efficiently there is very little wasted
energy that creates heat. This means that no coolant is needed for the electric motor and
therefore no antifreeze is needed. Cars which have a battery management system such as any of
the Tesla’s or the Hyundai Kona use coolant to cool their batteries, there will be some sort of
antifreeze properties within this coolant.
REGENERATIVE BRAKING REDUCES MAINTENANCE COSTS
An electric cars brakes need replacing less often than a gasoline car. The reason for this is that an
electric car uses regenerative braking. Regenerative braking or regen braking for short is when
you take your foot off the accelerator pedal and the electric motor within an electric car starts
spinning in reverse.
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 19
Essentially the car uses its kinetic (movement) energy to recharge the battery and slow down the
car. As you can see regen breaking works very different from the mechanical brakes you have on
your gas car, they use friction to make your car stop. Don’t worry you still have mechanical brakes
on an electric car, it’s just that you might not need to use them as much due to regen braking.
Normally an electric car has different levels of regen braking you can choose, ranging from harder
to softer. The harder regen braking will top up your car’s battery more than one of the softer
settings. If you speak with some electric car owners I’m sure they’ll tell you its a strange feeling at
first to use regen braking but you get used it over time. The electric car owners who are pro’s with
regen breaking use the one pedal method as much as possible. The one pedal method is when
people are essentially using the accelerator pedal to do all the driving because the regen braking
is doing the braking for them.
MAINTENANCE OF AN ELECTRIC CAR
Generally, maintenance of an electric car is a lot less when compared to their gasoline
counterparts. Generally no oil changes or new oil filters are required, no air filter, no spark plug
changes, no exhaust maintenance such as catalytic converter, the brakes last longer on an
electric car, no power steering fluid to be replaced and there are a lot less moving parts in an
electric car.
Typically an ICE can have up to 10,000 moving parts whilst an electric car can have
approximately 1000 moving parts. With a lot less moving parts there is a lot less chance of a
breakdown and things going wrong.
Electric cars and ICE cars both require the following things to be maintained: brake fluid, brake
pad replacement, windshield washer fluid, 12-volt battery, wiper blades, air conditioning recharge,
and tire replacement.
NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Your partner in Energy Services
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 20
NewBase energy news is produced daily (Sunday to Thursday) and
sponsored by Hawk Energy Service – Dubai, UAE.
For additional free subscription emails please contact Hawk Energy
Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
Mobile: +97150-4822502
khdmohd@hawkenergy.net
khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with a total of 25 years of experience in
the Oil & Gas sector. Currently working as Technical Affairs Specialist for
Emirates General Petroleum Corp. “Emarat“ with external voluntary Energy
consultation for the GCC area via Hawk Energy Service as a UAE
operations base , Most of the experience were spent as the Gas Operations
Manager in Emarat , responsible for Emarat Gas Pipeline Network Facility &
gas compressor stations . Through the years, he has developed great
experiences in the designing & constructing of gas pipelines, gas metering &
regulating stations and in the engineering of supply routes. Many years were spent drafting, &
compiling gas transportation, operation & maintenance agreements along with many MOUs for the
local authorities. He has become a reference for many of the Oil & Gas Conferences held in the
UAE and Energy program broadcasted internationally, via GCC leading satellite Channels.
NewBase : For discussion or further details on the news above you may contact us on +971504822502 , Dubai , UAE
Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed,
or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 21

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New base energy news 19 november issue 1296 by khaled al awadi

  • 1. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 1 NewBase Energy News 19 November 2019 - Issue No. 1296 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: How oil and gas is enabling the UAE's shift to a knowledge-led economy The national For more than 40 years, Adnoc and the oil and gas sector have been critical to the development of the UAE and its economic diversification efforts. Since oil prices slumped in 2016, Adnoc has undergone a transformation to ensure that the return on every barrel of oil produced is maximised. This will allow for the continued contribution from the oil and gas sector amid a shift to a knowledge-led economy.
  • 2. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 2 l
  • 3. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 3 Dubai Supreme Council of Energy reviews work progress on Demand Side Management Strategy.. © Copyright Emirates News Agency (WAM) 2019. Demand Side Management Strategy aims to reduce the demand for electricity and water by 30% by 2030 DUBAI - H.H. Sheikh Ahmed bin Saeed Al Maktoum, Chairman of the Dubai Supreme Council of Energy, held the 57th meeting of the council in the presence of Saeed Mohammed Al Tayer, Vice Chairman of the Dubai Supreme Council of Energy, where they discussed the work progress on the Demand Side Management Strategy, which aims to reduce the demand for electricity and water by 30 percent by 2030. Attendees at the council meeting included Ahmed Buti Al Muhairbi, Secretary-General of the Dubai Supreme Council of Energy, and the council's board members, including Dawood Al Hajri, Director-General of Dubai Municipality; Abdullah bin Kalban, CEO and MD of Emirates Global Aluminium; Saif Humaid Al Falasi, Group CEO of ENOC; Waleed Salman, Vice Chairman of Dubai Nuclear Energy Committee; Nasser Abu Shehab, CEO of RTA’s Strategy and Corporate Governance Sector; and Frederic Chemin, General Manager at Dubai Petroleum. The meeting also discussed the Dubai Green Mobility Strategy 2030 to increase the number of hybrid and electric vehicles in the market and raise their proportion to 10 percent by 2030. It addressed the work progress of the Etihad Energy Services Company's projects for Shams Dubai, Emiratisation, and advancing the capabilities of Emiratis in the Supreme Council’s organisations. "We support the vision of His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, to transform into a green economy," Al Tayer, said adding, "The meeting discussed the Etihad ESCO projects that depend on the Standards and Regulations of the Shams Dubai initiative. The Dubai Electricity and Water Authority, DEWA, launched Shams Dubai to encourage household and building owners to install photovoltaic panels to generate electricity and connect them to the DEWA's grid. The meeting reviewed the progress of this initiative for government buildings. The DEWA has installed 10 percent so far, and intends to install another 10 percent by 2020." "During the meeting, we discussed the RTA’s initiative to speed up the transformation into green mobility. The initiative aims to transform 90 percent of limousines operating in Dubai into environmental-friendly vehicles (hybrid/electric) by 2026, starting from 2020. The RTA will ensure more hybrid and electric cars into its limousine fleet to reduce 45 percent of carbon emissions to support the Dubai Green Mobility Strategy," Al Muhairbi said. Saudi Aramco’s Mammoth Share Sale Stacks Up in Five Charts
  • 4. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 4 Bloomberg - Filipe Pacheco Saudi Arabia put a valuation on oil giant Aramco of between $1.6 trillion and $1.71 trillion, well below the $2 trillion target sought by Crown Prince Mohammed bin Salman since he first touted the deal in 2016. The kingdom will list only 1.5% of the company on the Tadawul and the offering will mainly target local investors. If shares price at 32 Saudi riyals ($8.53) -- the high end of the range -- it will just beat Alibaba Group Holding Ltd. to the title of the world’s biggest IPO. World's Biggest IPO? At the top of the range, Aramco's IPO would be bigger than Alibaba's * World record IPO; Source: Bloomberg At the lower end of 30 riyals, Aramco will still be more than three times bigger than the entire Saudi stock market. A poll of 24 money managers by Bloomberg News shows more than 40% put the company’s fair range at $1.2 trillion to $1.5 trillion. Way Bigger
  • 5. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 5 Even at the lower end of range, Aramco would dwarf the Saudi market Source: Aramco, Bloomberg *The market capitalization as of Nov. 16 The new valuation implies Aramco, which has promised a dividend of at least $75 billion next year, will reward investors with a yield of between 4.4% and 4.7%. That compares with just under 5% for Exxon Mobil and 6.4% for Shell. At this rate, it would dwarf last year’s payouts from the 80 listed firms on the Saudi bourse that paid dividends, according to data compiled by Bloomberg. Investors who buy into the IPO have been guaranteed that the dividend won’t fall until after 2024. That’s the big question. Prince Mohammed caused something of a shock in 2016 when he first announced the plan and estimated the oil giant’s valuation at $2 trillion. That’s almost twice the size of Microsoft Corp., the world’s most valuable listed company. Some equity analysts put the number closer to $1.5 trillion. (Bloomberg Intelligence estimates $1.1 trillion.) A clearer picture should emerge when analysts publish reports on the IPO this month. Giant Dividend
  • 6. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 6 Aramco's dividend versus what 80 companies listed in Riyadh paid last year Source: Aramco, Tadawul, Bloomberg *Does not include Real Estate Investment Trusts No matter what the final valuation, the share sale will create a public company of unmatched profitability. Aramco earned a net income of $111 billion in 2018 on revenue of $315 billion. It pumps about 10% of the world’s oil from giant fields under the kingdom’s deserts. Aramco makes more money than any other company, but investors may balk if the valuation is set too high, particularly given the political risk. To lure investors, the authorities are reshaping the oil producers’ finances (most of its revenue goes in taxes and royalties to the government) as well as promising bumper dividends. For instance, the royalty it pays for Brent crude prices below $70 a barrel is falling to 15% from 20%. The “base dividend” in 2020 will be $75 billion -- much bigger in magnitude than other oil giants pay but a good deal smaller in terms of yield. Profit King
  • 7. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 7 Saudi Aramco’s profit = Apple + Google + Exxon Mobil Source: Moody's Investors Service, Bloomberg The company is so big, investors and analysts were concerned it could drain liquidity from the Saudi market. In recent months, many analysts have said that local investors -- key for a successful deal -- were offloading some of their portfolio to buy Aramco shares. The Tadawul All Share Index has under performed emerging markets as the Saudi government accelerated preparations for the IPO. The index, which finished little changed on Sunday, has retreated 1.1% since Aug. 29, compared with an 8.1% increase for the MSCI Emerging Markets Index. IPO price range values company at up to $1.7 trillion The company is offering individual and institutional investors 1.5 per cent of its shares at a price range of 30 to 32 Saudi riyals a share. Saudi Aramco is offering retail and institutional investors a 1.5 per cent stake in an initial public offering on the kingdom's benchmark Tadawul index, valuing the company between $1.6 trillion and $1.7tn (Dh5.9tn to Dh6.2tn) and making it potentially the world's largest listing to date. The price range for the offering has been set at 30 Saudi riyals to 32 riyals a share, the company said on Sunday. Aramco will issue two hundred billion shares. The final offer price will be determined at the end of the book-building period, which is December 4, according to the company. Individual investors will subscribe based on a price of 32 Saudi riyals, which is the top end of the price range. If the final offer price is below 32 riyals, individual investors can, in respect to the difference between the highest price on offer and the final price, elect to have the surplus subscription amount refunded in cash as credit to their account or be considered for an allotment of additional shares, the company said.
  • 8. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 8 Aramco, the most profitable commercial entity in the world, outshining the likes of Apple, Google and Amazon, recorded a $68 billion profit for the first nine months of the year and may eclipse the listing of China's Alibaba in 2014 that raised $25bn on the New York Stock Exchange. In April, Aramco issued a debut $10bn bond, which was hugely oversubscribed. Aramco is the largest integrated oil and gas company in the world, producing one in every eight barrels of crude. In 2018, the company produced 13.6 million barrels per day of oil equivalent, including 10.3 million bpd of crude. The company kicked off the IPO process on November 3, confirming its intention to float its shares on Saudi Arabia's Tadawul stock exchange, the Arab world's largest market. After the initial listing on Tadawul, Aramco is expected to carry out a secondary listing on an international exchange. “Saudi Aramco's forthcoming IPO on the Saudi Stock Exchange could enable the sovereign to further strengthen its net asset position,” S&P Global Ratings said in a note. “And, if subsequently effectively deployed, the funds raised could be used to support longer-term economic growth in Saudi Arabia.” The bulk of the funds raised are expected to to the government or the Public Investment Fund, potentially adding to the sovereign's already strong fiscal net asset position of 72.7 per cent of gross domestic product, S&P said. The ratings agency also said "as a result of the recent bond and forthcoming equity offerings, there has been an increase in financial and operating disclosures", which is supportive for investors. "The IPO will also help to benchmark Saudi Aramco against regional and global peers." The Aramco IPO is central to Riyadh's ambitions to transform the kingdom's economy. Funds from the share float are also expected to boost spending on Vision 2030 projects such as the $500bn futuristic economic free zone Neom and the Red Sea Project, a mega-tourism attraction. The country is aiming to open up its tourism and entertainment sector. Aramco Failure to Win Foreign Money Makes IPO Local Event Bloomberg - Javier Blas
  • 9. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 9 Two ye- ars ago, when the initial public offering of Saudi oil giant Aramco held the imagination of foreign investors, President Donald Trump felt compelled to publicly lobby for the share sale to happen in America. Today Saudi Aramco isn’t just shunning New York -- and other international exchanges -- as a listing venue, but has decided it won’t even market the IPO to American, Canadian, European or Japanese investors. Instead, Aramco plans to rely heavily on ultra-wealthy Saudis, many of whom have been pressed to invest, to get the deal done. Saudi banks are loosening lending regulations to allow locals to buy more shares. The IPO once was promoted as the strongest sign of economic change in Saudi Arabia: the deal that was going to attract tens of billions of foreign capital into the kingdom. Instead, a slimmed down share sale is starting to look more like a levy on the country’s economy as Saudi investors, large and small, take the place of foreign money managers. It may well still be the world’s largest IPO, perhaps raising about $25 billion and valuing the company at $1.6 trillion to $1.7 trillion, well above the biggest names of Silicon Valley. But that’s short of the $100 billion that Saudi Crown Prince Mohammed bin Salman said he was hoping to raise when he first mooted the IPO in 2016. At that point, he targeted a valuation of at least $2 trillion.
  • 10. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 10 “Saudi Arabia has been moving the IPO toward becoming more focused on regional investors for a while,” Ayham Kamel, Middle East practice head at consultant Eurasia Group. “Western demand was going to be lukewarm given the valuation and the geopolitical risk.” So poor is the international appetite for the deal, even at the lower valuation, Saudi Aramco decided at the last minute against marketing the IPO in the U.S., Canada and Japan -- three markets traditionally seen as a must-go destination for any big Wall Street deal. Instead of the planned approach to American investors, using what lawyers and bankers know as the 144A rule of the U.S. Securities Act, Aramco decided on Sunday the tepid interest meant it wasn’t worth the trouble. The array of Wall Street banks, including Goldman Sachs Group Inc, Morgan Stanley and JPMorgan Chase & Co, with mandates to sell the stock to international investors, were taken aback by the sudden decision, according to people familiar with the matter, who asked not to be named discussing private conversations. Skipping the U.S. means saying goodbye to powerful American pension funds with billions of dollars managed from cities like Boston and Los Angeles. On Monday, Aramco’s banks told investors in London and other European cities that roadshow events planned for this week had been canceled. In a sign of Aramco’s shifting ambitions, the company published an English version of the updated prospectus more than 24 hours after the Arabic version posted the target price range early on Sunday. “The valuation range is higher than most institutional investors would consider attractive,” said Neil Beveridge, analyst at Sanford C. Bernstein & Co. “Aramco’s price range would imply a premium valuation to western oil majors on almost every valuation metric.” The new valuation implies Aramco, which has promised a dividend of at least $75 billion next year, will reward investors with a dividend yield of between 4.4% and 4.7%, below what other oil majors pay. Exxon Mobil Corp. pays a dividend yield of just under 5%, while Royal Dutch Shell Plc pays 6.4%. The difference between local and foreign investors is that Prince Mohammed, the country’s day- to-day ruler, has leverage at home. Overseas, he has almost none. Many of the rich Saudi families that will now become key investors in Aramco learned the ruthlessness of Prince Mohammed during the crackdown that saw many arrested in the Ritz Carlton hotel in Riyadh in 2017. Prince Mohammed also controls the local banking industry, which will lend billions of dollars to Saudi retail investors to buy shares. Despite the tepid interest overseas, the 34-year-old Prince Mohammed is all but sure to get the job done -- even if the result falls short of his original ambitions. As well as a lower valuation between $1.6 and $1.7 trillion, it won’t be the 5% of company’s capital he envisioned. Instead just 1.5% will be offered. The combination of a lower valuation and a smaller stake means that there will almost certainly be enough Saudi money to buy the shares – and perhaps guarantee reasonable post-IPO trading -- but the sale will be a long way from the seismic global financial event Prince Mohammed touted in back in 2016.
  • 11. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 11 Oman: Oilfield casing accessories manufacturing plant launched Oman Observer Omani oilfield services firm Gulf Energy SAOC opened on Sunday its first cementing casing accessories manufacturing facility in the Sultanate to support Petroleum Development Oman’s (PDO) operations and other customers in Oman and the GCC region. The main objective of this investment is to boost the Omani economy by creating more jobs and training opportunities, saving costs and enabling custom-made solutions and adequate lead-time delivery of goods and services. Complementing PDO’s In- Country Value strategy, the centre, located in Nizwa, will support PDO’s operations by locally manufacturing cementing casing accessories and associated services including centralisers, stop collars and floats equipment. Established in an area of over 9,600 square metres, the complex has over 1,400 m2 allocated for workshops. Underlining Gulf Energy’s commitment to promote localisation, the $2.4 million facility achieves about 92 per cent Omanisation by creating 24 jobs for Omanis so far. PDO Well Engineering Contracts Manager Salman al Maimani said: “In addition to supporting existing projects of Gulf Energy with PDO, this new facility in Nizwa can also support other customers in the country and wider region, underscoring the added value Gulf Energy is bringing to the oil and gas supply chain in Oman. “At the same time, this plant further reinforces PDO’s own localisation efforts and In-Country Value strategy which aims to create more jobs, training and learning opportunities for Omanis and enhance domestic supply chains. The facility will provide efficiencies to PDO as well as minimise any delays in equipment delivery and installation.” The opening of the facility, under the auspices of Salim bin Nasser al Aufi, Under-Secretary of the Ministry of Oil and Gas, marks the completion of another of the opportunities outlined in the Ministry of Oil and Gas ICV strategic blueprint which was unveiled in 2013. PDO is leading on 43 out of the 53 originally unveiled to Oman’s oil and gas industry. Vice President of Gulf Energy SAOC in Oman Sultan al Ghafri said: ‘’We are pleased to expand our manufacturing activities in Oman and enhance the In-Country Value of our business. We believe in Omani talents and are committed to contributing to the Omani economy throughout the value chain. The new facility will allow us to expand on hiring and training local talents and providing the industry with excellent casing accessories made in Oman.” He added: “I would like to thank PDO for their support of Gulf Energy, an Omani National Champion for the region, and we look forward to delivering top quality, locally designed and produced products to the region.” NOVEMBER 18, 2019
  • 12. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 12 U.S.A: EIA's Heating Oil and Propane Update shows lower prices so far this winter Source: U.S. EIA, Heating Oil and Propane Update (HOPU) According to the U.S. Energy Information Administration’s (EIA) Heating Oil and Propane Update (HOPU), prices at the start of the 2019–2020 winter heating season (October 1 through March 31) were 10% lower for heating oil and 22% lower for propane than at the start of the previous winter. HOPU is published as part of the State Heating Oil and Propane Program (SHOPP), a joint effort between EIA and several state energy offices to collect state-level residential heating oil and propane price data from October through March in states where heating oil and propane use is common.
  • 13. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 13 According to the U.S. Census Bureau’s 2018 American Community Survey, distillate heating oil is the primary home heating fuel in 4.6% of U.S. homes and tends to be more common in the Northeast. Propane is the primary heating fuel in 4.8% of U.S. homes. Propane as a primary heating fuel tends to be more common in the Midwest. Source: U.S. Energy Information Administration, based on U.S. Census Bureau American Community Survey 2018 SHOPP collects residential heating oil and propane prices for 21 states. In 18 additional states, only propane prices are collected; in the District of Columbia, only heating oil prices are collected. SHOPP also provides wholesale heating oil prices for 25 states and propane prices for 23 states. Stakeholders and analysts use these state-level heating oil and propane prices and region-level inventories to monitor markets as well as to facilitate emergency response to fuel supply shortages during winter months. To improve the accuracy of the state-level prices, EIA selected two new samples for residential heating oil and propane prices and implemented a new sampling methodology in October 2019. EIA is also now publishing standard errors for SHOPP price estimates, which allow data users to compute a confidence interval around the corresponding average price estimate. Weekly SHOPP price data are available each Wednesday at 1:00 p.m. Eastern Time on the Winter Heating Fuels and Heating Oil and Propane Update web pages.
  • 14. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 14 NewBase 19 November 2019 Khaled Al Awadi NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE Oil falls 2% on oversupply fears, trade talk concerns Reuters + NewBase Oil fell about 2% on Tuesday on concerns about excess global crude supply and limited progress toward resolving a U.S.-China trade dispute that has clouded the outlook for oil demand. Brent crude LCOc1 futures fell $1.31, or 2.1%, to $61.13 a barrel by 12:53 p.m. EST (1753 GMT). U.S. West Texas Intermediate (WTI) crude CLc1 futures lost $1.47, or 2.6%, to $55.58 a barrel. Brent has rallied about 15% this year, supported by a pact by the Organization of the Petroleum Exporting Countries and its allies, including Russia - a group known as OPEC+ - to cut combined oil output by 1.2 million barrels per day from Jan. 1. Russia is unlikely to agree to deepen cuts in oil output at a meeting with fellow exporters next month, but could commit to extend existing curbs to support Saudi Arabia, three sources said. OPEC and its allies will consider whether to deepen cuts to crude supply when they next meet in December due to worries about weak demand growth in 2020, sources from the oil-producing club said. Oil price special coverage
  • 15. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 15 “We expect uneasy talks in December. Russia will not categorically agree to (deepen) cuts in winter,” a source familiar with the matter said. The news on Russia’s stance sent oil prices lower as investors worried about potential oversupply. “Moreover, Russia also failed to fulfill its agreed cuts in November so far,” Commerzbank analyst Carsten Fritsch said. Further weighing on prices, a Chinese government source was quoted by CNBC on Monday as saying there was gloom in Beijing about prospects for a trade deal. The long-running dispute has hit economic growth prospects. “The less than promising reports coming from China on the trade war may have taken some of the energy out of the rally,” said Craig Erlam, analyst at brokerage OANDA. “We’re certainly seeing less momentum in the recent rallies.” Oil prices were also hit by a larger-than-expected rise in Norwegian oil production and the prospect of a further increase in U.S. crude inventories, suggesting ample supplies. Norway’s production rose in October to beat the official forecast as output from the Johan Sverdrup field began ahead of schedule. This is the largest field to come on stream in the North Sea - home of the Brent contract - for years. The average estimate from six analysts polled by Reuters was for U.S. crude inventories to have risen by about 1.1 million barrels last week, representing a fourth consecutive weekly gain. The American Petroleum Institute releases its supply report at 4:30 p.m. EST (2130 GMT) on Tuesday and the government’s official figures are due on Wednesday. Oil found some support from tension in the Middle East, home to top exporter Saudi Arabia and other core OPEC members. Protesters in Iraq blocked a commodities port on Tuesday.
  • 16. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 16 NewBase Special Coverage News Agencies News Release 19 August 2019 Electric-Car Onset Leaves Lubricant Industry Facing Kodak’s Fate Bloomberg - Andrew Marc Noel + NewBase The $146 billion lubricants industry is at risk of suffering the same fate as Kodak, thanks to the rise of electric vehicles. From Volkswagen AG to Nissan Motor Co., carmakers are switching to battery-powered models that use fewer greases than combustion vehicles. With demand expected to decline from 2025, lubricant makers are wary of Eastman Kodak’s demise when it failed to grasp the potential of the digital camera in the 1970s. For decades, lubricant makers have been preoccupied with squeezing more fuel efficiency from combustion engines and increasing the mileage between oil changes. EVs present a new set of challenges to their piston counterparts that typically use 40 different oils. They need a grease that can cool and lubricate the motor, while also protecting the electronics on-board and being compatible with non-metal materials like plastics. “I’m very conscious of the world changing,” said Dave Hall, a 30-year industry veteran who is overhauling BP Plc’s line-up of Castrol lubricants for the EV market. “I’d like to think we’re trying to address and prevent a Kodak moment and not just lock it away in a cupboard as maybe they did.” Motoring Ahead Electric vehicles are expected to make up most new vehicle sales by 2040 Source: Bloomberg NEF
  • 17. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 17 With the current crop of electric cars in circulation, attention has largely been on battery performance and design, with lubricants an afterthought. Some EVs use standard greases found in combustion engines, according to Lutz Lindemann, chief technology officer at Fuchs Petrolub SE. There are signs the pressure is already poised to affect companies. Demand for automotive lubricants, which reached about 20 million tons last year, is supposed to be flat for the “foreseeable future” due to the impact of EVs, the growing use of synthetic lubricants and economic pressures, according to research from energy consultant Kline & Company. No Cliff Edge Other oil majors, who are fighting the effects of the push to de-carbonize on multiple fronts, have also focused on creating new products. Royal Dutch Shell Plc, the largest global supplier of finished lubricants, has developed a line of fluids engineered specifically for the high-tech powertrains of hybrids and EVs. Total SA launched two brands of lubricants for EVs last year, while Petronas announced its own EV brand this year. Like Castrol, Fuchs has created a dedicated international team of managers and researchers solely focused on developing and marketing lubricants for EVs, Lindemann said. With carmakers desperate to extend the range, coming up with a new formula capable of a 1% gain in efficiency could boost driving range by 4 miles, BP’s Hall said. Driven by penetration of EVs in China and Europe, sales volumes in the lubricants market could start to decline as early as 2025, according to Bank of Merrill Lynch analyst Jean-Baptiste Rolland. He estimates battery electric vehicles require 50% to 70% less in greases than internal combustion engines. “The bottom line is the volumes are not going to make up the loss that we’re going to see from the engine oil going away,” said George Morvey, industry manager for the energy practice at Kline. Both Morvey and Fuchs’ Lindemann said the silver lining is the industry sees the disruption ahead, and has a long time to respond to it. There’ll be no cliff edge given the number of combustion vehicles in China alone is set to jump, to 350 million in 10 years’ time from 260 million now, Lindemann said. Plus developing specialist high-performance lubricants for battery vehicles will result in more-profitable sales, he added. Lindemann said the lubricants value in a BEV is “probably 90%” of a combustion car. “We just don’t really know for sure but it’s not a dramatic disaster for us,” he said. “There’ll be a significant decrease in volume but not. DO ELECTRIC CARS USE OIL? Electric cars do not use oil in the same way that Internal Combustion Engine (ICE) cars do. Typically an ICE car uses oil to lubricate all the moving parts within the engine and to keep everything working. An electric car does use grease, which technically is an oil-based substance and provides lubrication to bearings in some electric motors. An oil change is required for electric cars that have a single speed gearbox, the oil is normally sealed within the transmission and will be changed by the
  • 18. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 18 manufacturer. It’s best to check with your manufacturer what the servicing requirements are and when the change is needed. Generally, most electric cars do not need an oil change in the same way that an ICE car does, this is because no oil is required to lubricate the engine. Electric motors are very efficient and there is not as much loss of energy creating heat, which cannot be said for an ICE. Electric motors have a small amount of moving parts, typically there is a rotor and a stator. In an electric motor, the stator creates a rotating magnetic field to move the rotor. DO ELECTRIC CARS NEED COOLANT? Some electric cars do need coolant, especially if they have a thermal management system within the car for cooling the batteries. A thermal management system is essentially the cars way of managing battery temperatures. For cooling the batteries the coolant is circulated around the battery packs to lower the temperature. Batteries have an optimal temperature they work best at, and overheating can cause degradation. Similarly colder temperatures can limit the speeds you can charge your car at, especially if the battery pack is cold. The solution of Tesla, in this case, is to use a resistance heater in the model S and X to heat the battery pack to an optimal temperature. Not only does this allow for normal charging speeds, but it also restores some of the range of the car which is temporarily lost due to cold batteries. If you are buying an electric car for the long term it’s a good idea to purchase one with a thermal management system. This also has other names such as a battery management system or BMS for short. The reason for this is that your batteries will be kept in a more optimal temperature which helps to decrease degradation. Some cars on the market do not offer this and instead have passive cooling where the outside air is used to cool the batteries. In some cases this will not be as effective as a BMS and over the longer term these cars will suffer greater battery degradation than those with a BMS in my opinion. DO ELECTRIC CARS USE TRANSMISSION FLUID? Transmission fluid is used in an electric car but as mentioned before it’s in a sealed unit. Typically this will not need to be changed as often as an ICE car because no gears are actually being changed. When the car wants to go in reverse the electric motor spins backward and when neutral is selected the electric motor stops spinning. DO ELECTRIC CARS NEED ANTIFREEZE? Since an electric motor within an electric car works very efficiently there is very little wasted energy that creates heat. This means that no coolant is needed for the electric motor and therefore no antifreeze is needed. Cars which have a battery management system such as any of the Tesla’s or the Hyundai Kona use coolant to cool their batteries, there will be some sort of antifreeze properties within this coolant. REGENERATIVE BRAKING REDUCES MAINTENANCE COSTS An electric cars brakes need replacing less often than a gasoline car. The reason for this is that an electric car uses regenerative braking. Regenerative braking or regen braking for short is when you take your foot off the accelerator pedal and the electric motor within an electric car starts spinning in reverse.
  • 19. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 19 Essentially the car uses its kinetic (movement) energy to recharge the battery and slow down the car. As you can see regen breaking works very different from the mechanical brakes you have on your gas car, they use friction to make your car stop. Don’t worry you still have mechanical brakes on an electric car, it’s just that you might not need to use them as much due to regen braking. Normally an electric car has different levels of regen braking you can choose, ranging from harder to softer. The harder regen braking will top up your car’s battery more than one of the softer settings. If you speak with some electric car owners I’m sure they’ll tell you its a strange feeling at first to use regen braking but you get used it over time. The electric car owners who are pro’s with regen breaking use the one pedal method as much as possible. The one pedal method is when people are essentially using the accelerator pedal to do all the driving because the regen braking is doing the braking for them. MAINTENANCE OF AN ELECTRIC CAR Generally, maintenance of an electric car is a lot less when compared to their gasoline counterparts. Generally no oil changes or new oil filters are required, no air filter, no spark plug changes, no exhaust maintenance such as catalytic converter, the brakes last longer on an electric car, no power steering fluid to be replaced and there are a lot less moving parts in an electric car. Typically an ICE can have up to 10,000 moving parts whilst an electric car can have approximately 1000 moving parts. With a lot less moving parts there is a lot less chance of a breakdown and things going wrong. Electric cars and ICE cars both require the following things to be maintained: brake fluid, brake pad replacement, windshield washer fluid, 12-volt battery, wiper blades, air conditioning recharge, and tire replacement. NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE Your partner in Energy Services
  • 20. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 20 NewBase energy news is produced daily (Sunday to Thursday) and sponsored by Hawk Energy Service – Dubai, UAE. For additional free subscription emails please contact Hawk Energy Khaled Malallah Al Awadi, Energy Consultant MS & BS Mechanical Engineering (HON), USA Emarat member since 1990 ASME member since 1995 Hawk Energy member 2010 Mobile: +97150-4822502 khdmohd@hawkenergy.net khdmohd@hotmail.com Khaled Al Awadi is a UAE National with a total of 25 years of experience in the Oil & Gas sector. Currently working as Technical Affairs Specialist for Emirates General Petroleum Corp. “Emarat“ with external voluntary Energy consultation for the GCC area via Hawk Energy Service as a UAE operations base , Most of the experience were spent as the Gas Operations Manager in Emarat , responsible for Emarat Gas Pipeline Network Facility & gas compressor stations . Through the years, he has developed great experiences in the designing & constructing of gas pipelines, gas metering & regulating stations and in the engineering of supply routes. Many years were spent drafting, & compiling gas transportation, operation & maintenance agreements along with many MOUs for the local authorities. He has become a reference for many of the Oil & Gas Conferences held in the UAE and Energy program broadcasted internationally, via GCC leading satellite Channels. NewBase : For discussion or further details on the news above you may contact us on +971504822502 , Dubai , UAE
  • 21. Copyright © 2015 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 21