New base energy news issue 847 dated 10 may 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,
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NewBase Energy News 10 May 2016 - Issue No. 847 Edited & Produced by: Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
UAE Masdar to deliver cycle 2 of UAE-Pacific Partnership Fund
WAM
A series of renewable energy projects made possible by the US$50 million UAE-Pacific
Partnership Fund (UAE-PPF) are set to be inaugurated in the Pacific Island countries and
territories.
Five small-scale solar energy projects, delivered by Abu Dhabi’s renewable energy company
Masdar, will come on stream across five island nations from May 10-15, marking the completion of
the second cycle of the UAE-PPF.
The highly customised projects are designed to drive economic growth and sustainable
development in the Solomon Islands, Nauru, the Marshall Islands, Palau and the Federated
States of Micronesia. The projects will help reduce the participating countries’ reliance on
imported fossil fuels, drive job creation and capacity-building efforts, and contribute to each
nation’s renewable energy targets.
Commenting on the imminent completion of the Cycle 2 projects, Masdar CEO Mohamed Jameel
Al Ramahi, said: "The projects coming online as part of Cycle 2 of the UAE-Pacific Partnership
Fund represent a model for what the public and private sectors can achieve by working together.
With the support of our UAE partners and the governments of the island nations, Masdar has
been able to deploy innovative, small-scale projects that meet the needs of the local communities.
"Through these projects, Masdar is not only helping to advance socio-economic growth, but it is
also showcasing a new delivery model for advancing the global sustainability agenda and taking
action on climate change."

Once inaugurated, the projects in Cycle 2 will deliver a total of 3.1 megawatts of clean energy and
will displace over 4,000 tons of carbon dioxide emissions per year. The Cycle 2 projects will also
save 1.7 million litres of diesel fuel each year, thereby supporting the countries’ energy
diversification efforts and reducing their exposure to commodity price fluctuations and supply
chain disruptions.
In addition, as part of the UAE-PPF’s requirements, Masdar has trained the operators of the
power generation assets, thereby supporting capacity-building and skills training in the local
communities and enhancing the capacity of existing regional contractors to deliver renewable
energy projects.
The Masdar-implemented energy infrastructure is also unique in that it has been designed to
withstand the natural disasters that are common to the Pacific Islands, including cyclones, gale-
force winds and torrential rainfall, further bolstering energy security.
Khaled Ballaith, Director of the Masdar Special Projects team, said: "The Pacific islands are
among the most remote, inaccessible places on Earth, and the needs of the communities vary
tremendously from island to island. I am proud that our team has been able to deliver innovative,
bespoke solutions to the five islands in Cycle 2, building on the best practices learned from Cycle
1 projects and projects implemented elsewhere."
The first cycle of the fund saw Masdar complete small-scale solar and wind projects in Kiribati, Fiji,
Samoa, Tonga, Tuvalu and Vanuatu. Highlights from the projects included cyclone-proof wind
turbines, space-optimising solar solutions, and plants providing 50% of local energy requirements.
The UAE-Pacific Partnership Fund was launched in response to the identification of renewable
energy as a key growth enabler at the January 2012 Pacific Leaders’ Meeting of the International
Renewable Energy Agency (IRENA). Masdar was appointed to design and implement the projects
by working closely with partners in the UAE and the host nation.
Funding for the UAE-PPF is provided by the Abu Dhabi Fund for Development, with oversight
from the UAE’s Ministry of Foreign Affairs and International Cooperation. The Fund represents an
important part of the UAE’s strategy to support sustainable development through the deployment
of renewable energy projects in communities across the globe.

Tunisia: PA Resources to sell entire licence interests onshore and
offshore Tunisia to ETAP…. Source: PA Resource
PA Resources has announced that its wholly owned subsidiaries, PA Resources Tunisia,
Hydrocarbures Tunisie Didon, Hydrocarbures Didon Jersey and Hydrocarbures Tunisie
Corp, have executed a sale and purchase agreement with ETAP, the Tunisian national oil
company, to sell their entire licence interests onshore and offshore Tunisia, to ETAP.
The sale is subject to customary government consents but the Company does not anticipate any
issues given the identity of the buyer.
The consideration for the sales is cash and the amount is confidential, however once received it
will be disbursed in accordance with the provisions of the Composition Plan adopted by
Stockholm District Court on 2nd October 2015 which became final and binding on 24th October
2015.

India's GSPC in talks with ONGC on selling gas field stake
Source: Reuters via Yahoo! Finance
India's Gujarat State Petroleum Corp (GSPC) said on Monday it is in talks with the country's
top explorer Oil and Natural Gas Corp on selling a stake in its gas block off the east coast, to
revive the challenging deep water field.
The block, where the discovery of
gas was announced in 2005 by
Prime Minister Narendra Modi while
leading his home state of Gujarat,
was to start commercial production
in 2011 but difficulties in drilling
5,000 metres below the seabed
pushed back the plan by about five
years.
GSPC, controlled by the state
government, has already invested
about $3.6 billion in exploring and
building infrastructure around the
block but with little success, and now
wants ONGC's help on funds and
drilling expertise.
GSPC says it now hopes to start
commercial production from
theKrishna Godavari field later this
year, with an initial output of 70-80
million cubic feet a day (mcfd).
'Commercial production is expected
to start after the drilling, hydraulic
fracturing and completion of the fifth
development well (D5), tentatively
by the end of October,' GSPC said in a statement emailed to Reuters.
ONGC declined to comment on talks with GSPC on buying a stake in the block.
GSPC had managed to extract around 23 mcfd since August 2014 from three wells it drilled
using conventional drilling methods. To expedite recovery, the company has now migrated
to hydraulic fracturing (fracking) - a technique popularised by U.S. shale drilling companies
and in which fractures are created in rock formations using pressurised fluids.
The fourth well is expected to start production by this weekend using the fracking method, which
would cost $60-$70 million for each well and involve global oilfield services firms such
asHalliburton and Schlumberger.
GSPC is also getting help from BP for a review of its drilling activity without cost, the company
said. Global petroleum consultancy firm Gaffiney, Cline and Associates had estimated the block
had in-place reserves of 14 trillion cubic feet (tcf), with around 7.6 tcf recoverable. India's
upstream regulator had estimated recoverable reserves of 2 tcf from the block excluding a part of
the south eastern area.

Nigeria: Shell workers evacuated from Bonga field after militant threa
Reuters via Yahoo! Finance / energy-pedia
Shell workers at Nigeria's Bonga oil field in the southern Niger Delta are being evacuated
following a militant threat, a senior labour union official said on Monday.
'We are aware of the development and the evacuation is being done in categories of workers and
cadres,' Cogent Ojobor, chairman of the Warri branch of the Nupeng oil labour union, said. 'My
members are yet to be evacuated.' He gave no numbers.
Shell said earlier on Monday that oil output was continuing at its oil fields in Nigeria despite local
media reports of a militant attack near its Bonga facilities.
'Our operations at Bonga are
continuing,' a spokesman for Shell
Nigeria Exploration and Production
Company (SNEPCo) said in a
statement. It said it would continue to
monitor the security situation in its
operating areas and take all possible
steps to ensure the safety of staff and
contractors.
Last week, militants attacked a
Chevron platform in the Delta where
tensions have been building up since
authorities issued an arrest warrant in
January for a former militant leader on

corruption charges.
President Muhammadu Buhari has said there would be a crack down on 'vandals and saboteurs'
in the Delta region, which produces most of the country's oil.
A group known as the Niger Delta
Avengers claimed responsibility for
the Chevron attack. The same group
has said it carried out an attack on a
Shell oil pipeline in February which
shut down the 250,000 barrel-a-day
Forcados export terminal.
Residents in the Delta have been
demanding a greater share of oil
revenues. Crude oil sales account for
around 70 percent of national income
in Nigeria but there has not been
much development in the poor Delta
region.
Buhari has extended a multi-million
dollar amnesty signed with militants in 2009 but upset them by ending generous pipeline
protection contracts.
The militancy is a further challenge for a government faced with an insurgency by the Islamist
militant Boko Haram group in the northeast and violent clashes between armed nomadic
herdsmen and locals over land use in various parts of the country.
According to information on the Shell web site, the Bonga field, which began producing oil and
gas in 2005, was Nigeria’s first deep-water development in depths of more than 1,000 metres.
Bonga has produced over 600 million barrels of oil to date. Oil and gas is produced via the
Bonga floating production storage and offloading (FPSO) facility, which has the capacity to
produce more than 200,000 barrels of oil and 150 million standard cubic feet of gas a day.

Senegal: Kosmos Energy announces significant gas discovery offshore
Source: Kosmos Energy
Kosmos Energy has announced that its Teranga-1 exploration well offshore Senegal has
made a significant gas discovery.
Located in the Cayar Offshore Profond
blockapprox. 65 kms northwest of Dakar in nearly
1,800 meters of water, the Teranga-1 well was
drilled to a total depth of 4,485 meters. The well
encountered 31 meters (102 feet) of net gas pay in
good quality reservoir in the Lower Cenomanian
objective.
Well results confirm that a prolific inboard gas
fairway extends approx. 200 kms from
the Marsouin-1 well in Mauritania through
the Greater Tortue area on the maritime boundary
to the Teranga-1 well in Senegal. Kosmos has now
drilled five consecutive successful exploration and
appraisal wells in this fairway with a 100 percent
success rate. In the process, the company has
discovered a gross Pmean resource of approx. 25
Tcf and estimates the fairway may hold more than
50 Tcf of resource potential.
Andrew G. Inglis, chairman and chief executive
officer, said:
'Our continuing exploration success demonstrates
we have opened a super-major scale basin offshore
Mauritania and Senegal with world-class resource
potential. Given the scale and quality of the gas
resource discovered along the inboard trend, our
focus is to move this resource through to
development. Our forward exploration plan is to
mature the two independent tests with oil potential in northern Mauritania and in the outboard of
Mauritania and Senegal for drilling in 2017.'
Kosmos holds a 60 percent interest in the Teranga-1 well, along with Timis Corporation Limited
at 30 percent and Société des Pétroles du Sénégal (Petrosen) at 10 percent. Since 2014,
Kosmos has held rights to conduct exploration in the St. Louis Offshore Profond and Cayar
Offshore Profond license areas under production sharing contracts with the Government of
Senegal.

U.S. energy-related carbon dioxide emissions in 2015 are 12%
below their 2005 levels.. Source: U.S. Energy Information Administration, Monthly Energy Review
After increasing in 2013 and in 2014, energy-related carbon dioxide (CO2) emissions fell in 2015.
In 2015, U.S. energy-related carbon dioxide emissions were 12% below the 2005 levels, mostly
because of changes in the electric power sector.
Energy-related CO2 emissions can be reduced by consuming less petroleum, coal, and natural
gas, or by switching from more carbon-intensive fuels to less carbon-intensive fuels. Many of the
changes in energy-related CO2 emissions in recent history have occurred in the electric power
sector because of the decreased use of coal and the increased use of natural gas for electricity
generation.
The reductions in CO2 emissions are spread out among the different end-use sectors in
proportion to the share of total electricity sales to each sector. Overall, the fuel-use changes in the
power sector have accounted for 68% of the total energy-related CO2 reductions from 2005 to
2015.
The amount of CO2 emissions in the primary (non-electricity) energy mix of end-use sectors has
also changed. In the residential and commercial sectors, primary energy such as natural gas is
used mainly for space heating, water heating, and cooking. In the industrial sector, many
processes rely on the direct consumption of fossil fuels to produce heat. Most of the energy
consumed in the transportation sector is primary energy in the form of motor gasoline, diesel fuel,
and jet fuel.

Two of the largest factors in year-to-year fluctuations of energy-related CO2 emissions are the
economy and the weather. The largest annual decline in energy-related CO2 emissions in the
past decade occurred in 2008–09 during the recession. Overall, the U.S. economy has grown
even as energy-related CO2 emissions have fallen.
Adjusted for inflation, the economy in 2015 was 15% larger than it was in 2005, but the U.S.
energy intensities and carbon intensities have both declined. On a per-dollar of gross domestic
product (GDP) basis, in 2015, the United States used 15% less energy per unit of GDP and
produced 23% fewer energy-related CO2 emissions per unit of GDP, compared with the energy
and emissions per dollar of GDP in 2005.
Weather also plays a role in annual fluctuations of energy-related CO2 emissions. Heating and
cooling degree days measure daily temperature differences compared with a base temperature of
65 degrees Fahrenheit (about 18 degrees Celsius). For instance, a daily average temperature of
45 degrees means 20 heating degree days; a daily average of 85 degrees means 20 cooling
degree days.
On a population-weighted national basis, the United States has about three times as many
heating degree days as cooling degree days. For this reason, annual energy-related CO2
fluctuations are more likely to resemble annual fluctuations in heating degree days. In the past
decade, energy-related CO2 emissions and heating degree days were both lowest in 2012.

N. America: Alberta's mega-wildfire: Is California next?
CNBC
For Californians, Alberta's gargantuan blaze is a reminder that the Golden State has faced its
own super-fires over the years — and officials warn that the risks are worsening.
El Nino-fueled storms have brought some relief to drought-parched California this year, but the
central and southern portions of the state, as well as the Sierra Nevada foothills in the north
remain at high risk, according to experts. The state's peak wildfire season comes in late July or
August, with the hot, dry conditions, although the danger will last well into the fall months.
California last year "had two of the top-10 most devastating fires in the state's history — very
similar conditions to what's occurring in Canada right now," said Ken Pimlott, chief of the
California Department of Forestry and Fire Prevention (CalFire). "There's drought-induced tree
mortality and we have just critically parched, dry vegetation, all (resulting in) just explosive fire
conditions."
State and federal officials estimate there are 29 million dead trees throughout the Sierra Nevada
mountain range. "There are a lot of trees that have died because of long-term drought and maybe
some bugs as well," said Heath Hockenberry, National Weather Service's national fire weather
program manager.
Last fall, two mega-fires brought death and destruction to Northern California. Together, the so-
called Butte and Valley fires caused an estimated $2 billion in damage, destroyed 1,830 homes,
and left six people dead. Nearly 150,000 acres were burned in five counties of the state, and
some wineries and vineyards were lost or damaged.
"The fire risk potential is quite high, particularly in Central and Southern California, where either
the hope for El Nino rains didn't really come but there were enough rains to cause more brush to
grow and chaparral to grow," said Mark Bove, a senior research meteorologist for Munich
Reinsurance America. "What will happen as they go into the dry season is all that new growth and
greenery will dry out and it will just end up being more fuel for potential fires later this summer and
autumn."
Stanton Florea, a Vallejo, California-based spokesman for the U.S. Forest Service, said Southern
California's "fire danger is starting off here in May. It is expected to be busier than normal down
there."
There was a reminder Friday of the region's brush-fire risk when a small blaze scorched dry
hillsides in San Dimas, a community located about 30 miles east of downtown Los Angeles The
blaze was put out by the L.A.County Fire Department before reaching the nearby Angeles
National Forest.
Overall, 2016 looks to be "closer to an average year for us than we've had in five or six years,"
said the U.S. Forest Service official. The roughly 20 million acres that the agency manages "will
not begin to see bigger campaign fires for some time," since there's still snow on the ground in
some higher elevation areas.
Other parts of the country are forecast to have elevated fire risk this season, too.

The Southwest and Southern states, as well as Alaska and Hawaii, will have "above-normal
significant wildland fire potential," with the risk starting as early as this month in some places,
according to a wildfire outlook issued May 1 by the
National Interagency Fire Center (NIFC) in Boise,
Idaho. "Normal significant wild land fire potential is
expected for the Northern Rockies. Significant wild
land fire potential is expected to transition from
above normal back to normal over the Appalachians
in May due to increasing moisture and green-up."
Preparations are already underway to test the readiness of fire crews and aerial firefighting
equipment out west.
In Colorado, Global SuperTanker's "Spirit of John Muir," a Boeing 747 converted into the world's
largest aerial fire-fighting plane, launched Thursday, and news media were given demonstrations
at the Colorado Springs Airport. The 747 is capable of carrying up about 20,000 gallons of water
or retardant.
"We're fully prepared for fire season," said Florea, the U.S. Forest Service spokesman. For the
2016 fire season, the agency has "helitack" crews and 21 air tankers available in the western
United States. They could boost that number up to 29 with eight military C-130's.
Meanwhile, Los Angeles County will have two Bombardier CL-415 Superscooper fire-fighting
aircraft on loan from the government of Quebec starting in the fall for wildfire suppression, as well
as the county's own fleet of helicopters. The county plans to stage extra strike teams in the field
this season and place them in higher fire risk areas such as Malibu and Santa Clarita. In February,
Malibu had a wildfire with some crews on the lines composed of state prisoners, including one
female inmate firefighter who died as a result of injuries suffered while battling the blaze.
The Oakland firestorm in 1991 remains the nation's costliest wildfire in dollar terms, totaling a $3
billion loss when adjusted to today's dollars, according to insurance industry data. The fires, which
took place during a drought year and in the hillsides above the East San Francisco Bay city, killed
25 people and destroyed 2,843 homes and more than 430 apartments.

NewBase 01 May 2016 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Oil prices dip on brimming crude stocks, Canada fires move
away from oil sands
Oil prices fell early on Tuesday as Canadian wildfires that have knocked out over 1 million barrels
worth of daily crude capacity moved away from production facilities, while brimming inventories
and a strong U.S. dollar weighed on markets.
U.S. crude futures were trading at $43.09 per barrel at 0040 GMT, down 35 cents from their last
settlement. Brent crude was down 26 cents at $43.37 a barrel.
"A reversal in the U.S.-dollar will continue to weigh on commodity markets. With concerns easing
over Canadian oil supply disruptions, crude oil could come under additional pressure," ANZ Bank
said.
A stronger dollar, in which oil is traded, makes fuel more expensive for countries using other
currencies, potentially hitting demand. The dollar has jumped over 1.5 percent this month after
falling by 7 percent against a basket of other currencies between January and April.
Canadian officials who got their first glimpse on Monday of the oil sands town of Fort McMurray
since a wildfire erupted and knocked out over 1 million barrels of daily crude production capacity
said almost 90 percent of its buildings were saved.
Oil price special
coverage

Despite the improving conditions, oil producers expect shutdowns of several weeks as facilities
like pipelines that were close to the fires need to be inspected, while evacuees need to leave the
production plants before staff can return.
Given that outages in Canada and around the world have eroded the 1-2 million barrels per day of
crude oversupply, some traders said that a $50 price may resemble a newly balanced market as
long as storage tanks remain as full as they are.
"It seems as if supply and demand have balanced, but there's still enormous amounts of crude
available in storage. With that in mind, it almost looks like $45 to $50 Brent resembles a balanced,
well stocked market," one trader said.
Traders said they were re-focusing on North America's brimming crude inventories despite the
disruptions from Canada, which exports most of its crude to the United States.
U.S. commercial crude stockpiles likely rose last week for the fifth straight week, a Reuters poll
showed, with total U.S. crude inventories seen to have built by 500,000 barrels to new record
highs above 543 million barrels.
With plentiful crude available, refiners have produced large volumes of gasoline and diesel,
threatening to overwhelm demand despite the upcoming peak summer U.S. driving season.
If that happens, refiners will lower their output and cut orders for new crude feedstock, putting
downward pressure on prices.

WTI Oil Flirts With Premium to Brent as Canada Fires Cut Supply
Bloomberg - Ben Sharples BenSharps
Oil in New York erased its discount to international prices amid speculation reduced supply from
Canada because of wildfires will accelerate the seasonal drop in U.S. crude stockpiles.
West Texas Intermediate for July delivery on Monday rose higher than Brent in London for a third
straight session during intraday trading, advancing as much as 15 cents above the global
benchmark. Futures on the New York Mercantile Exchange climbed as much as 2.9 percent as
fires led to cuts equivalent to about 40 percent of oil sands production from Canada, the biggest
supplier to the U.S.
“We have supply issues coming out of Alberta and that’s affecting the confidence about Canada
providing supply down through Cushing,” Jonathan Barratt, the chief investment officer at Ayers
Alliance Securities in Sydney, said by phone.
The reduction of Canadian oil to the U.S. -- which imported about 3.17 million barrels a day last
year from its northern neighbor -- is near-term bullish amid a seasonal drop in crude inventories,
Morgan Stanley said in a report Monday. America’s peak summer driving season will start on
Memorial Day, which falls this year on May 30, and typically results in a reduction of stockpiles as
refiners maximize gasoline output.
Commercial U.S. crude inventories have swelled to 543.4 million barrels, the most since October
1929, according to data from the Energy Information Administration. Supplies at Cushing,
Oklahoma, the delivery point for WTI and the nation’s biggest oil-storage hub, are near a record.

NewBase Special Coverage
News Agencies News Release 01 May 2016
Riding the ‘Solarcoaster’ as Shares Plunge Even More Than Coal
Bloomberg - Joe Ryan
For all the upbeat forecasts about the growth of solar power, this is a punishing year for the
industry. And it won’t improve anytime soon.
SunEdison Inc., the world’s biggest clean-energy company, is bankrupt. Yingli Green Energy
Holding Co., once the top panel maker, warned it may be inching toward default. A Bloomberg
index of 20 major solar companies has plunged more than 30 percent this year, with every
member in the down column. Solar shares are performing even worse than coal stocks.
The tumult comes as installations soar and demand for clean energy reaches records. Falling
prices, renewed U.S. tax breaks and the Paris climate deal are fueling sales worldwide. That’s
been eclipsed by investors’ concerns that the debt-fueled strategies employed by SunEdison and
Yingli are endemic to the industry.
“They call it the solarcoaster for a reason,” said Nancy Pfund, managing partner of DBL Partners
and a SolarCity Corp. director. With so much happening, both positive and negative, “it’s been
hard for investors to follow.” Solar turbulence isn’t new. The past decade has been marked by
booms, busts and failures that included Suntech Power Holdings Co. and Q-Cells SE, which
both were once the world’s biggest panel producers.

Despite the ups and downs, the general trend is up. Developers will install 48.4 gigawatts of solar
by the end of 2020, more than double the amount in the prior five years, according to Bloomberg
New Energy Finance. Problems at a few major companies don’t necessarily carry over to the rest.
At least they shouldn’t.
‘More Perception’
“It’s more perception than true fundamentals,” said Angelo Zino, analyst at S&P Global Market
Intelligence. “The fundamentals continue to improve.’’ That means there may be bargains, said
Leslie D. Biddle, a partner at Serengeti Asset Management, a $1.5 billion New York hedge fund
that specializes in distressed debt.
“At the moment,’’ Biddle said, “solar equities are a buying opportunity.’’
Solar investors remain rattled, with legitimate questions about leverage and financing. The
markets are looking for proof that companies can make and install panels profitably.
“Investors lost a lot of money on SunEdison -- and quickly,” said Carl Weatherley-White, former
president of developer Lightbeam Electric Co. “They’re nervous. We’ll need to see a steady
quarter or two of success by the public companies.”
Against that expectation, the drumbeat of bad news continues. Abengoa SA, a builder of solar-
thermal power plants, is seekinginvestor support for a 9.4 billion-euro ($10.7 billion) debt
restructuring plan to avoid becoming Spain’s largest corporate failure. And Wednesday, hedge
fund manager Jim Chanos said SolarCity, which is down more than 50 percent this year, will face
more “financial trouble” in 2016, in part because the largest U.S. rooftop solar provider loses
money on every installation.
While there are a variety of reasons Wall Street has soured on solar, the conversation always
comes around to SunEdison, the industry’s biggest-ever failure, which cited $16.1 billion in
liabilities when it sought protection from creditors April 21.

The company spent billions on a debt-fueled buying binge, which peaked in July when it
announced plans to acquire the rooftop installer Vivint Solar Inc. for $2.2 billion. The deal
prompted analysts to take a closer look at SunEdison’s finances, revealing an overleveraged,
overcomplicated behemoth that’s financially entangled with two publicly traded holding
companies.
‘’It is impossible for people not to be concerned when the leader nosedives like that,” said Shawn
Kravetz, founder of Esplanade Capital LLC, a Boston fund manager with a decade of investing
experience in solar.
SunEdison’s decline shows another unusual trend. In past boom-bust cycles, the carnage was
within specific parts of the solar industry; sometimes manufacturers, other times developers. This
time, it’s both.
With SunEdison in bankruptcy, the industry’s one-time leading panel-maker is teetering toward
default. Yingli, which hasn’t reported a quarterly profit since 2011, has 1.4 billion yuan ($215
million) of notes due on May 12, and said in April it would be “very difficult” to make the payment.
Financial problems are hardly isolated to the marquee names, said John Berger, chief executive
of the closely held residential solar installer Sunnova Energy Corp. Many solar companies have
“growth-at-any-cost’’ business models that are neither profitable nor sustainable.
“When you don’t generate the returns for the equity holders that they are expecting, you don’t
make money,” Berger said. “There are a lot of management teams in this sector that haven’t
figured that out.’’
Even profitable companies are revisiting business models. First Solar Inc., the biggest U.S. solar
manufacturer, detailed in April aplan to focus on future growth from making and selling high-
efficiency solar panels rather than large power plants. A few weeks later it announced plans to
replace its CEO. Its shares are down more than 20 percent this year.
Ethan Zindler, a New Energy Finance analyst, said the economics of solar economics have never
been better, given low equipment costs and surging demand. “But that’s not reflected in the share
prices.”

Offshore drilling prospects dim amid productivity focus
Bill Loveless, for USA today
The annual Offshore Technology Conference in Houston is one of the premier expositions of
breakthroughs that enable oil and natural gas producers to reach deeper into the ocean faster,
cheaper and safer.
Unfortunately for the vendors displaying new
implements at NRG Park this past week, the
prolonged downturn in oil and gas prices makes it
difficult for producers to expand their tool kits
when they’re cutting investments and personnel.
Bernard Looney, the chief executive for BP’ s
global upstream operations, acknowledged as
much in his presentation at the event.
“How will all of this play out? Quite honestly, it’s
hard to tell,” Looney observed, echoing
sentiments of his peers around the world.
Still, an important lesson is emerging for the
industry, even as it draws its belt ever tighter, according to Looney, whose remarks were posted
on BP’s website.
Now, more than ever, improving productivity is essential, not only to make money at lower prices
but also to compete effectively with up and coming forms of energy, like wind and solar energy,
and electric vehicles.
“Hydrocarbons have been unchallenged on cost for a long time,” he said. “But the competitiveness
of alternatives is improving. They may represent a small part of the energy mix, but we cannot
afford to ignore them.”
Looney isn’t losing faith in his industry’s ability to recover. He cited a BP forecast that oil and gas
will meet more than half of the world’s energy needs in 2035.
He warned, however, that oil and gas companies can’t afford to play down progress among
energy alternatives, especially as demands for lower-carbon energy gain ground around the
world.
“Electric vehicles are scaling up quickly as they drive down costs,” Looney said. “The Tesla Model
3 will go over 300 miles on a single charge, and over 300,000 people put their money down for
one in the first week after it launched earlier this year.”
Meanwhile, the cost of onshore wind electricity has fallen by half since 2009, while prices for solar
manufacturing are down by three quarters over roughly the same time, he noted.
For BP and other oil and gas companies, the experience has historically been different.
“In most industries, such as manufacturing or aviation, costs come down with time,” Looney said.
“In oil and gas, specifically the upstream, costs tend to follow the oil price and in general have
trended upwards over time. We need to change this.”

The good news for oil and gas producers is that the U.S. shale boom is sending a message about
productivity with its surprising resilience.
“If you look at sector production overall, since November 2014, the U.S. onshore (drilling) rig count
has fallen from 1,865 to 420, almost 80%,” he said. “And yet production is pretty much the same
as it was then.”
At BP, development costs for wells in the San Juan Basin in Colorado and New Mexico are down
60% in the last few years.
“This is continuous improvement in action,” Looney said. “We need to learn what we can from this
phenomenon across the industry. We need to challenge what we’re doing and learn to adapt. We
need to adopt a fundamentally different mindset.”
For the oil patch, that may be the best thing that can be said about hard times.
Bill Loveless — @bill_loveless on Twitter — is a veteran energy
journalist and television commentator in Washington. He is a former
host of the TV program Platts Energy Week.

NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Your partner in Energy Services
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
NewBase 10 May 2016 K. Al Awadi

New base energy news issue 847 dated 10 may 2016

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New base energy news issue 847 dated 10 may 2016