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NewBase Energy News 12 October 2016 - Issue No. 935 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: Sharjah National Oil Corp, Uniper pen LNG supply MoU
LNG World + NewAgencies
Sharjah National Oil Corporation (SNOC) and Uniper signed a memorandum of
understanding targeting LNG imports to the Port of Hamriyah in the Emirate of
Sharjah in the UAE.
First gas deliveries should arrive into Sharjah in the spring of 2018, according to a statement by
the Sharjah National Oil Corporation.
Gas will flow to the Sajaa gas field complex and further into the existing pipeline network
throughout the Northern Emirates, to be marketed to existing consumers and new businesses.
John Roper, managing director & head of Middle East for Uniper Global Commodities, said the
company will assist SNOC in developing the Port of Hamriyah to receive LNG cargoes and obtain
supplies of energy from global LNG markets.
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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Qatar taking ‘aggressive’ stance in Europe to mitigate LNG risks
Gulf Times
Qatar’s reign as the world’s largest liquefied natural gas (LNG) exporter may end by 2017 as
liquefaction capacity in Australia reaches 120bcma (billion cubic metres per annum), and new
supplies from the US begin to kick in; but Doha is taking an “aggressive” stance in Europe to
mitigate the risks, according to Arab Petroleum Investment Corporation (Apicorp).
Several factors have historically provided Qatar with a competitive advantage over its rivals, and
may yet do so against new supplies, given its large sovereign wealth cushion, Apicorp said in a
report.
“The new LNG supplies from Australia have already started to eat into Qatar’s monopoly in Asia
and new supplies from the US will challenge Qatar’s dominance,” it said, highlighting that the
proportion of Qatari LNG into Japan, South Korea and China fell 3.6% in 2016 as Australia
increased its share in the three countries by 8.4%.
Qatar is thus facing a new reality where Asian importers now have more options, whilst low prices
and more supplies in Europe mean that Qatar will need to offer more flexible contracts, it said.
However, in some of these key importing countries, its exports have diversified, with the number
of Qatari LNG importers tripling from eight in 2007 to 24 in 2015. In Asia, its share of imports into
China and Taiwan has increased modestly.
In India, LNG traded close to Japanese prices at $4.9/mmBtu prompting the amendment to Qatari
export terms and the provision of cheaper gas – down to $6-7/mmBtu this year from $9.2mmBtu in
2015.
As part of the deal, Petronet – set up by the Indian government to import LNG – agreed to import
an additional 1.3bcma from RasGas. Finding that Qatar is also keen to increase its presence in
Europe by offering more flexible terms; Apicorp said Qatargas 3 – a joint venture among Qatar
Petroleum, ConocoPhillips and Mitsui – will deliver 1.5bcma to RWEST in North West Europe over
seven and a half years.
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Separately, RasGas, which already provides UK-based EDF with 11bcma, signed an agreement
to supply their new import terminal in Dunkirk with 2.7bcma. Higher exports in 2015 to Europe
increased Qatar’s market share in the region by 3.3% year on year (y-o-y).
Qatar also brokered a four-year deal earlier this year to supply Kuwait with 0.7bcma from March.
Recently, Qatar Petroleum (QP) signed a deal with Abu Dhabi National Oil Company to enhance
supplies to the UAE via the Dolphin pipeline. Furthermore, QP has taken advantage of its
domestic joint ventures to forge their first major foreign partnership with ExxonMobil, and their
interest to purchase shares in both Mozambique and Egypt’s Zohr field.
Qatar’s ability to offer more competitively priced contracts ensures a steady stream of revenue,
Apicorp said, adding at present, more than 80% of its production is committed for 2016-20 as part
of supply purchase agreements, securing revenue stability.
“Going forward, a key decision for Qatar is whether to maintain the existing moratorium on the
North field, and develop new LNG projects. But this depends on global fundamentals and hinges
primarily on the level of US exports and the extent to which Chinese demand grows,” the report
said.
The LNG outlook appears to be “soft” over the medium term, which perhaps may not be the best
time for new Qatari supplies to enter the market. In the event that the moratorium is lifted, Qatar
will have to consider the costs associated with upstream projects and current liquefaction trains
before developing new LNG projects, it said.
“Qatar can act strategically and increase its supplies, which will depress global LNG prices further
and slow the development of new LNG capacity elsewhere; but if it goes down this route, it may
have to endure a period of low prices for several years. Either way, the country is well positioned
given its $250bn sovereign wealth funds, and its low production costs would keep it competitive,” it
said.
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US: Tesla's expanded Fremont factory, doubling the size in California
CNBC - Robert Ferris | @RobertoFerris
The company recently submitted a plan to the city of Fremont for an additional 4.5 million square
feet of buildings, essentially doubling the amount of factory space. The move comes as the
company sets the ambitious goal of increasing its manufacturing output to 500,000 by the end of
2018, even as some analysts and investors have worried about its track record of missing delivery
targets.
Tesla said earlier this month that its production
numbers hit a new record of 25,185 for the third
quarter, a 37 percent rise over the previous
quarter. Still the company will probably badly
need the new space to meet not only its overall
production goal, but also a successful rollout of
the Model 3 sedan —Tesla's chance to break
into the mid-priced car market.
Earlier this year, Tesla CEO Elon Musk said the
company is aiming to make 100,000 to 200,000
Model 3 sedans alone in just the second half of 2017. At its current rate of roughly 2,000 cars per
week, the company would only make 104,000 total cars for the whole year.
This is what the plan looks like, according to the proposal:
The proposed buildings are outlined in red on the image, and there is a red dashed line outlining
Tesla's property.
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The Fremont Planning Commission is scheduled to meet Thursday to discuss the plan and
choose whether to recommend an approval to the Fremont City Council, which will likely hold a
meeting next month to decide whether to approve the plan.
"We are really excited," said Fremont Mayor Bill Harrison in an interview with CNBC. "Tesla has
been expanding in Fremont over the last few years, and we think the submission of this plan
solidifies their investment in Fremont. But it also shows people that we can still manufacture in
California."
The factory currently employs about 6,210 people, according to the proposal Tesla submitted to
the commission. The new square footage would create an estimated 3,105 to 9,315 jobs, the
proposal said. A BART mass transit rail station will open soon next to the plant, making it the only
auto manufacturing plant in North America to be next to mass transit, Harrison said.
Local laws require that Tesla first grant permission for its larger development project, then obtain
permits for individual buildings, which Tesla may build over a period of several years. Tesla will
also be able to make some changes as it goes forward.
"This is a conceptual plan, this gives them flexibility in the future if they need to move things
around as they get closer to rolling out the Model 3," Harrison said.
Harrison said he thinks the expansion will also attract other companies "that want to be around
Tesla," such as solar power firms, battery companies, and other businesses, and that the city is
already beginning to see such interest. "We are calling it the 'Tesla effect,'" he said.
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Russia and Turkey sign agreement on the TurkStream project
Source: Gazprom
Turkey and Russia have signed an agreement for the construction of the planned TurkStream gas
pipeline that would take Russia natural gas under Turkish waters in the Black Sea towards
Europe. The agreement was signed on Monday in Istanbul, where the 23rd World Energy
Congress is underway.
The agreement provides for the construction of two strings of the gas pipeline from Russia
to Turkey across the Black Sea, as well as an onshore string for gas transit to Turkey's border with
neighboring countries.
'The document signed today is extremely important as it sets out the legal framework for the
TurkStream project. The Agreement has been prepared in an unprecedentedly short period
of time, which shows the strong commitment of both sides to deliver the project as soon
as possible. This is entirely understandable because the TurkStream gas pipeline will substantially
enhance the reliability of gas supply to Turkey, as well as southern and southeastern Europe,' said
Alexey Miller, Chairman of the Gazprom Management Committee.
Background
On December 1, 2014, Gazprom and Turkey's Botas signed the Memorandum of Understanding to construct the
TurkStream gas pipeline. The pipeline will run 660 kilometers along the old route of South Stream and cover 250 kms
of a new route toward the European part of Turkey. It is planned that the first string with the capacity of 15.75 billion
cubic meters will be used exclusively for gas supplies to the Turkish market.
In September 2016, Gazprom received a number of permits for the project from the Turkish authorities, including the
first construction permit for the offshore section and the survey permit for the two strings of the offshore gas pipeline
in Turkey's exclusive economic zone and territorial waters.
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Russia says its oil firms ready to back production cuts
AFP/Istanbul
Russia on Tuesday said its oil majors were ready to back moves by the government to curb oil
production in coordination with Opec to push up oil prices that have been under pressure for
months.
A day after President Vladimir Putin propelled oil prices higher by saying Moscow could join Opec
by freezing or cutting production, Energy Minister Alexander Novak confirmed that Russia was
ready to take part in the process of "rebalancing" prices.
But speaking at the World Energy Congress in Istanbul, Novak emphasised that Russian
companies, who include state-controlled oil giant Rosneft, were prepared to be included in such
moves.
"We have discussed this situation with our companies... And I repeat again that our companies
have expressed readiness to take part in joint actions on the oil market."
"We will continue this work with our companies," he said, noting that while Russia has some 200
oil companies, 10 prominent players account for 90 percent of production.
Putin's declarations on Monday, also at the Istanbul forum, gave oil markets a boost with the
prospect of tighter coordination between the top non-Opec oil producer Russia and the cartel.
Novak is expected on Wednesday to hold talks in Istanbul with some Opec members. Opec had
last month in Algiers agreed its first production cut in eight years to bolster prices.
"I think that very soon we can join decisions taken by Opec," said Novak, echoing Putin's
comments. "It is important for the producers and consumers."
He said that Opec and non-Opec members could take actions to stabilise the situation on the oil
markets "without touching the fundamental market principles".
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"It is a shared task," he said, praising participants for showing "sense and flexibility".
He predicted that the volatility on oil markets "will continue to be at a high level but in time it will
decrease."
Novak told reporters after his appearance in a plenary session that it was most sensible for Russia
to consider a six month freeze in production that could then be further extended if necessary.
A year long freeze would be "rather a long time", he said.
'Broad consensus'
The secretary general of Opec Mohammed Barkindo, described the Algiers agreement as a
"turning point" and hailed the greater coordination with non-cartel members like Russia.
"We have restored the broad consensus among all producers," he said.
Following the mismatch of supply and demand that drove up prices, he said there was an
"overhang" of high stock inventories "rising to levels we have never seen before."
"In order to restore stability we need to -- with our non-Opec friends - to address the issue of this
overhang."
"Until we address this, we will not achieve the fair (oil) price."
In a sign of the growing cooperation between Russia and Opec, Novak held talks with the energy
minister of the cartel's kingpin Saudi Arabia on the sidelines of the congress, both sides said.
The Saudi energy ministry said the talks between Novak and Khalid al-Falih were the latest step in
"the ongoing process of cooperation aimed at expediting the rebalancing underway in global oil
markets."
"The ministers emphasised that their two countries are committed to working together and with
other producers, Opec and non-Opec," it said, adding the pair would hold more talks in Riyadh
later this month.
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NewBase 12 October 2016 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Oil edges up before producer talks on output curbs
Reuters + NewBase
Crude futures inched up on Wednesday, with investors waiting for talks between OPEC producers
and other oil exporters on curbing output to end a glut in the global market.
Brent crude was up 9 cents at $52.50 a barrel at 0012 GMT. It fell 73 cents, or 1.4 percent, to
close at $52.41 a barrel on Tuesday, retreating from a one-year high of $53.73 hit on Monday.
U.S. West Texas Intermediate (WTI) crude had gained 3 cents to $50.82 a barrel. It dropped 56
cents, or 1 percent, to settle the previous session at $50.79.
Oil has rallied more than 13 percent in less than two weeks since OPEC proposed its first
production curbs in eight years. But prices remain about half of mid-2014 highs above $100 a
barrel as questions remain over when the market will return to balance.
OPEC will hold talks with non-member oil producers on Wednesday to try to thrash out details of a
global agreement to cap production for at least six months as Russia lent its support for the plan.
Global oil supply could fall in line with demand more quickly if OPEC and Russia agree to a steep
enough cut in production, but it is unclear how rapidly this might happen, the International Energy
Agency said on Tuesday.
Goldman Sachs added its doubts on Tuesday, saying in a research note that the planned oil
output cut by OPEC and other exporters has become a "greater possibility," but warned a
production cut likely won't be deep enough to re-balance markets in 2017.
Oil price special
coverage
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Oil Price Holds Above $50
Oil held above $50 a barrel amid uncertainty over Russia’s willingness to join OPEC efforts to
stabilize the market.
Futures were little changed in New York after declining 1.1 percent Tuesday. Russia’s largest
producer Rosneft PJSC said it won’t reduce output, according to Reuters, after President Vladimir
Putin had earlier said his nation would join the Organization of Petroleum Exporting Countries in
limiting production.
The comment from Rosneft Chief Executive Officer Igor Sechin doesn’t contradict Putin’s stance
on a supply deal, Kremlin spokesman Dmitry Peskov said.
Oil rose to a 15-month high Monday after Saudi Arabia expressed optimism that a deal could be
finalized to cut output and Russia signaled support. While Saudi Arabia’s oil minister left Istanbul
before a producer meeting Wednesday, OPEC Secretary-General Mohammed Barkindo said most
of the work on an accord was already done and countries including Russia, Azerbaijan, Algeria
and Venezuela will still meet to “compare notes.” OPEC supply quotas will be decided at the
group’s official gathering late next month in Vienna.
“The lead up to the November OPEC meeting could see some volatility amid doubts about a
supply deal,” said Angus Nicholson, a market analyst in Melbourne at IG Ltd. “I don’t think a drop
below $45 is likely given the potential upside shock of a supply agreement coming together.”
West Texas Intermediate for November delivery was at $50.90 a barrel on the New York Mercantile
Exchange, up 11 cents, at 10:09 a.m. in Hong Kong. The contract declined 56 cents to $50.79 on Tuesday,
falling from the highest close since July 2015. Total volume traded was about 70 percent less than the 100-
day average.
Brent for December settlement rose 21 cents to $52.62 a barrel on the London-based ICE Futures Europe
exchange. The contract dropped 73 cents to $52.41 on Tuesday. The global benchmark was at a $1.28
premium to December WTI.
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NewBase Special Coverage
News Agencies News Release 12 October 2016
Shale gas not EPA has pushed decline in coal-generated electricity
Oil & Gas - Staff Writers
Data shows benchmark gas prices ('Henry Hub' prices) in the past four years to be cheaper than
coal from Appalachia for over 88% of the months. Even the cheapest coal, in Wyoming's Powder
River Basin, competes poorly in generating power in the great population centers east of the
Mississippi once rail transport of $0.03 per ton-mile is considered. Image courtesy of The
electricity Journal.
Cheap shale gas produced
by fracking has driven the
decline in coal production in
the United States during the
last decade, researchers at
the Great Lakes Energy
Institute at Case Western
Reserve University have
found.
Power plants, which use 93
percent of the coal produced
nationally, have been
operating under the same
EPA regulations signed into
law by President George
H.W. Bush in 1990. Proposed new rules since then have all been challenged in court and not
implemented until June 2016, when the EPA's restrictions on mercury and other toxic emissions
were approved by the U.S. Supreme Court.
Consumption of coal continued to grow under those 1990-era EPA rules until 2008, and then went
into steady decline, dropping by 23 percent from 2008 thru 2015.
The data show the drop in those years to be correlated with the shale revolution, as natural gas
production increased by a factor of more than 10 and its price dropped in half, the researchers
say.
And, due to the continuing--and in some cases accelerating--technological and economic
advantages of gas over coal, the decline in coal is expected to continue at least decades into the
future. Their study is published in The Electricity Journal.
"Some people attribute the decline in coal-generated electricity to the EPA's air-quality rules, even
calling it 'Obama's war on coal,'" said Mingguo Hong, associate professor of
electrical engineering and computer science at Case Western Reserve and co-author of the study.
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"While we can't say that the EPA rules have no impact--as, for example, discouraging the building
of new coal power plants because of the expectation that tougher air-quality rules will clear the
courts--the data say the EPA rules have not been the driving force."
Hong, co-director of the Electricity Systems Research Lab at Case Western Reserve, and Walter
Culver, a founding member of the Great Lakes Energy Institute Advisory Board at the university,
say the data show that shale-gas competition is what's been hurting coal as of today.
They expect that, as wind and solar sources of electricity continue to improve, they will be tough
competitors to coal in the not-distant future.
The authors examined data available from the U.S. Energy Information Administration, academia,
specialized energy consultants, and Wall Street analysts and publically available information of
the electric utilities and gas industry--in some cases down to the profit and loss statements.
"If you're a power plant operator and you see gas supply is continuing to increase and natural gas
can do the job cheaper--by a lot--the decision to switch from coal is pretty easy," Culver said.
The long-term outlook
"As we look toward the future, we see no natural mechanisms that will permit coal to recover,"
Culver said.
Gas supply continues to grow. Starting in 2009, gas production each year has exceeded U.S.
Energy Information Administration (EIA) annual projections. And the proved gas reserves are
outpacing production exponentially, the researchers note. Lastly, pipelines out of Appalachia--
where the cheapest and most abundant shale gas is found--are expected next year to increase
access to gas in that region by 55 percent above recent production.
There is a valid concern that the supply of natural gas will be limited by a recent debilitating drop
in prices that has arisen from over-supply, Culver said. In fact, one driller per month has gone
bankrupt in 2015 and early 2016.
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But after reviewing the profit-and-loss statements of gas drillers, the researchers believe that a
point of price stability exists where both the drillers can be profitable enough to keep drilling and
the price to power plants--particularly for gas from the Marcellus and Utica shale deposits in
Appalachia--will still be far lower than coal.
Some analysts suggest that exports of liquefied natural gas (LNG) will drive down the domestic
supply and raise prices. But Hong and Culver say shipping costs, to Asian markets in particular
and well-positioned regional competitors, are likely to prevent U.S. LNG from competing easily
internationally. That would leave a strong supply here at attractive prices.
Beyond gas price, state regulations and generator technologies have been and will continue to be
factors in the loss of coal production, they conclude.
Since 2010, the cost of utility-scale solar power has declined 68 percent and onshore wind 51
percent, making them close to, or already competitive with coal, the researchers say.
Policies in three-quarters of America's states encourage the addition of wind and solar as
replacements for coal. As costs have dropped, some states are pushing a faster switch to those
renewables.
Because wind and solar fail to provide constant power, fill-in energy sources are needed. Until
large-scale batteries or other electricity-storage technologies become more practical, gas is the
logical choice over coal to augment the grid, Culver says. Gas plants can be fired up and turned
down faster than coal plants, thus lowering costs to consumers and producing less pollution.
Forthcoming EPA air-quality regulations may further disadvantage coal, Hong and Culver say.
Burning natural gas, for instance, produces no mercury emissions, half the carbon dioxide of coal
and 80 percent less sulfur.
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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BP Sees Oil Demand Growth Swamping Impact of Electric Cars
Anna Hirtenstein ahirtens
Rising demand for oil over the next two decades is likely to overwhelm the impact of the electric
car on crude markets, said Spencer Dale, chief economist for BP Plc.
“They’ll have a huge impact in terms of air quality, but it’s not a game changer over 20 years even
with aggressive electric vehicle penetration,’’ Dale said at in a panel discussion at the Bloomberg
New Energy Finance summit in London on Tuesday.
The clean-energy research unit of Bloomberg LP estimates that battery-electric vehicles, which
only run on power from a plug, will displace 13 million barrels of oil a day by 2040. BP projects oil
demand to increase by about 20 million barrels a day over the next 20 years, with about a quarter
of supply going to passenger vehicles.
Dale’s comments illustrate why major oil companies don’t see electric cars as a threat to their
business -- even with BP’s forecast that 70 million of them may be on the road in two decades.
Efficiency gains such as improved fuel economy may have more of an impact on oil demand than
electrified transport, he said, noting mileage standards and better engines would have “many
times greater’’ impact on oil demand.
“I do think sometimes that perhaps if our objective has to do with climate, perhaps we should
spend more time on how to encourage and capture those improvements in efficiency rather than
on EVs,’’ he said. “If I had some subsidies to use, I’d ask if it’s always best to encourage a switch
from internal combustion engine to electric vehicle or better internal combustion engines? Bigger
bang for your buck.’’
BP anticipates electric vehicles will have a bigger impact from 30 to 50 years into the future. That
could happen sooner if social preferences shifted to favor use of electric cars, Dale said.
“Suppose people start buying EVs because of what it says about them, rather than the
economics,” Dale said. “All the economic modeling we do may get thrown out the window.’’
Coal Miner’s CEO Calls Tesla a ‘Fraud’
The head of the biggest privately owned U.S. coal
producer on Monday called electric-car maker
Tesla Motors Inc. a “fraud” for failing to turn a
profit despite subsidies.
Elon Musk, the billionaire chief executive officer
of Tesla, fired back at Murray Energy Corp. CEO
Robert Murray within hours on Twitter.
Real fraud going on is denial of climate science. As for "subsidies", Tesla gets pennies on dollar
vs coal. How about we both go to zero?
6:23 PM - 10 Oct 2016
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In his post, Musk said Tesla gets “pennies” on the dollar in subsidies compared with the coal
industry, and that climate science denial is the “real fraud.”
The verbal sparring between Murray and Musk comes as seismic changes in energy policy and
competition from natural gas have pummeled coal miners, leading to bankruptcies and record
production cuts. Meanwhile, the presidential election has underscored differences between
Republicans and Democrats in their approaches to federal energy regulations and spending.
In his interview with CNBC on Monday, Murray said Tesla was an example of the many
companies collecting subsidies through energy policies supported by Democratic presidential
nominee Hillary Clinton. “Here again, it’s subsidies, and Hillary Clinton said they need government
help,” he said.
Murray added that such policies were about Clinton “supporting her friends” rather than protecting
the environment, and that the shutdown of all U.S. coal plants would do nothing to fight climate
change.
Murray Energy announced earlier this summer that it was considering cutting more than 4,000
jobs, accounting for about 80 percent of its workforce, amid weak coal prices.
SolarCity Buy
For its part, Tesla was downgraded to neutral from a buy rating by Goldman Sachs Group Inc. last
week. The company’s shares have dropped as it moves forward with its plan to buy rooftop solar
installer SolarCity Corp., which some analysts have deemed a risky bet. Musk is chairman of
SolarCity, and his cousin Lyndon Rive serves as its chief executive officer.
Customers who purchase an electric vehicle can claim a $7,500 federal income tax credit and
several states offer additional incentives, according to Tesla’s website. Tesla will let Musk’s tweet
“stand as a comment,” spokeswoman Alexis Georgeson said in an e-mail. The Clinton campaign
didn’t immediately respond to a request for comment.
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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 26 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 12 October 2016 K. Al Awadi
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

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New base energy news issue 935 dated 12 october 2016

  • 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 12 October 2016 - Issue No. 935 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: Sharjah National Oil Corp, Uniper pen LNG supply MoU LNG World + NewAgencies Sharjah National Oil Corporation (SNOC) and Uniper signed a memorandum of understanding targeting LNG imports to the Port of Hamriyah in the Emirate of Sharjah in the UAE. First gas deliveries should arrive into Sharjah in the spring of 2018, according to a statement by the Sharjah National Oil Corporation. Gas will flow to the Sajaa gas field complex and further into the existing pipeline network throughout the Northern Emirates, to be marketed to existing consumers and new businesses. John Roper, managing director & head of Middle East for Uniper Global Commodities, said the company will assist SNOC in developing the Port of Hamriyah to receive LNG cargoes and obtain supplies of energy from global LNG markets.
  • 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 Qatar taking ‘aggressive’ stance in Europe to mitigate LNG risks Gulf Times Qatar’s reign as the world’s largest liquefied natural gas (LNG) exporter may end by 2017 as liquefaction capacity in Australia reaches 120bcma (billion cubic metres per annum), and new supplies from the US begin to kick in; but Doha is taking an “aggressive” stance in Europe to mitigate the risks, according to Arab Petroleum Investment Corporation (Apicorp). Several factors have historically provided Qatar with a competitive advantage over its rivals, and may yet do so against new supplies, given its large sovereign wealth cushion, Apicorp said in a report. “The new LNG supplies from Australia have already started to eat into Qatar’s monopoly in Asia and new supplies from the US will challenge Qatar’s dominance,” it said, highlighting that the proportion of Qatari LNG into Japan, South Korea and China fell 3.6% in 2016 as Australia increased its share in the three countries by 8.4%. Qatar is thus facing a new reality where Asian importers now have more options, whilst low prices and more supplies in Europe mean that Qatar will need to offer more flexible contracts, it said. However, in some of these key importing countries, its exports have diversified, with the number of Qatari LNG importers tripling from eight in 2007 to 24 in 2015. In Asia, its share of imports into China and Taiwan has increased modestly. In India, LNG traded close to Japanese prices at $4.9/mmBtu prompting the amendment to Qatari export terms and the provision of cheaper gas – down to $6-7/mmBtu this year from $9.2mmBtu in 2015. As part of the deal, Petronet – set up by the Indian government to import LNG – agreed to import an additional 1.3bcma from RasGas. Finding that Qatar is also keen to increase its presence in Europe by offering more flexible terms; Apicorp said Qatargas 3 – a joint venture among Qatar Petroleum, ConocoPhillips and Mitsui – will deliver 1.5bcma to RWEST in North West Europe over seven and a half years.
  • 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 Separately, RasGas, which already provides UK-based EDF with 11bcma, signed an agreement to supply their new import terminal in Dunkirk with 2.7bcma. Higher exports in 2015 to Europe increased Qatar’s market share in the region by 3.3% year on year (y-o-y). Qatar also brokered a four-year deal earlier this year to supply Kuwait with 0.7bcma from March. Recently, Qatar Petroleum (QP) signed a deal with Abu Dhabi National Oil Company to enhance supplies to the UAE via the Dolphin pipeline. Furthermore, QP has taken advantage of its domestic joint ventures to forge their first major foreign partnership with ExxonMobil, and their interest to purchase shares in both Mozambique and Egypt’s Zohr field. Qatar’s ability to offer more competitively priced contracts ensures a steady stream of revenue, Apicorp said, adding at present, more than 80% of its production is committed for 2016-20 as part of supply purchase agreements, securing revenue stability. “Going forward, a key decision for Qatar is whether to maintain the existing moratorium on the North field, and develop new LNG projects. But this depends on global fundamentals and hinges primarily on the level of US exports and the extent to which Chinese demand grows,” the report said. The LNG outlook appears to be “soft” over the medium term, which perhaps may not be the best time for new Qatari supplies to enter the market. In the event that the moratorium is lifted, Qatar will have to consider the costs associated with upstream projects and current liquefaction trains before developing new LNG projects, it said. “Qatar can act strategically and increase its supplies, which will depress global LNG prices further and slow the development of new LNG capacity elsewhere; but if it goes down this route, it may have to endure a period of low prices for several years. Either way, the country is well positioned given its $250bn sovereign wealth funds, and its low production costs would keep it competitive,” it said.
  • 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 US: Tesla's expanded Fremont factory, doubling the size in California CNBC - Robert Ferris | @RobertoFerris The company recently submitted a plan to the city of Fremont for an additional 4.5 million square feet of buildings, essentially doubling the amount of factory space. The move comes as the company sets the ambitious goal of increasing its manufacturing output to 500,000 by the end of 2018, even as some analysts and investors have worried about its track record of missing delivery targets. Tesla said earlier this month that its production numbers hit a new record of 25,185 for the third quarter, a 37 percent rise over the previous quarter. Still the company will probably badly need the new space to meet not only its overall production goal, but also a successful rollout of the Model 3 sedan —Tesla's chance to break into the mid-priced car market. Earlier this year, Tesla CEO Elon Musk said the company is aiming to make 100,000 to 200,000 Model 3 sedans alone in just the second half of 2017. At its current rate of roughly 2,000 cars per week, the company would only make 104,000 total cars for the whole year. This is what the plan looks like, according to the proposal: The proposed buildings are outlined in red on the image, and there is a red dashed line outlining Tesla's property.
  • 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 The Fremont Planning Commission is scheduled to meet Thursday to discuss the plan and choose whether to recommend an approval to the Fremont City Council, which will likely hold a meeting next month to decide whether to approve the plan. "We are really excited," said Fremont Mayor Bill Harrison in an interview with CNBC. "Tesla has been expanding in Fremont over the last few years, and we think the submission of this plan solidifies their investment in Fremont. But it also shows people that we can still manufacture in California." The factory currently employs about 6,210 people, according to the proposal Tesla submitted to the commission. The new square footage would create an estimated 3,105 to 9,315 jobs, the proposal said. A BART mass transit rail station will open soon next to the plant, making it the only auto manufacturing plant in North America to be next to mass transit, Harrison said. Local laws require that Tesla first grant permission for its larger development project, then obtain permits for individual buildings, which Tesla may build over a period of several years. Tesla will also be able to make some changes as it goes forward. "This is a conceptual plan, this gives them flexibility in the future if they need to move things around as they get closer to rolling out the Model 3," Harrison said. Harrison said he thinks the expansion will also attract other companies "that want to be around Tesla," such as solar power firms, battery companies, and other businesses, and that the city is already beginning to see such interest. "We are calling it the 'Tesla effect,'" he said.
  • 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 Russia and Turkey sign agreement on the TurkStream project Source: Gazprom Turkey and Russia have signed an agreement for the construction of the planned TurkStream gas pipeline that would take Russia natural gas under Turkish waters in the Black Sea towards Europe. The agreement was signed on Monday in Istanbul, where the 23rd World Energy Congress is underway. The agreement provides for the construction of two strings of the gas pipeline from Russia to Turkey across the Black Sea, as well as an onshore string for gas transit to Turkey's border with neighboring countries. 'The document signed today is extremely important as it sets out the legal framework for the TurkStream project. The Agreement has been prepared in an unprecedentedly short period of time, which shows the strong commitment of both sides to deliver the project as soon as possible. This is entirely understandable because the TurkStream gas pipeline will substantially enhance the reliability of gas supply to Turkey, as well as southern and southeastern Europe,' said Alexey Miller, Chairman of the Gazprom Management Committee. Background On December 1, 2014, Gazprom and Turkey's Botas signed the Memorandum of Understanding to construct the TurkStream gas pipeline. The pipeline will run 660 kilometers along the old route of South Stream and cover 250 kms of a new route toward the European part of Turkey. It is planned that the first string with the capacity of 15.75 billion cubic meters will be used exclusively for gas supplies to the Turkish market. In September 2016, Gazprom received a number of permits for the project from the Turkish authorities, including the first construction permit for the offshore section and the survey permit for the two strings of the offshore gas pipeline in Turkey's exclusive economic zone and territorial waters.
  • 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 Russia says its oil firms ready to back production cuts AFP/Istanbul Russia on Tuesday said its oil majors were ready to back moves by the government to curb oil production in coordination with Opec to push up oil prices that have been under pressure for months. A day after President Vladimir Putin propelled oil prices higher by saying Moscow could join Opec by freezing or cutting production, Energy Minister Alexander Novak confirmed that Russia was ready to take part in the process of "rebalancing" prices. But speaking at the World Energy Congress in Istanbul, Novak emphasised that Russian companies, who include state-controlled oil giant Rosneft, were prepared to be included in such moves. "We have discussed this situation with our companies... And I repeat again that our companies have expressed readiness to take part in joint actions on the oil market." "We will continue this work with our companies," he said, noting that while Russia has some 200 oil companies, 10 prominent players account for 90 percent of production. Putin's declarations on Monday, also at the Istanbul forum, gave oil markets a boost with the prospect of tighter coordination between the top non-Opec oil producer Russia and the cartel. Novak is expected on Wednesday to hold talks in Istanbul with some Opec members. Opec had last month in Algiers agreed its first production cut in eight years to bolster prices. "I think that very soon we can join decisions taken by Opec," said Novak, echoing Putin's comments. "It is important for the producers and consumers." He said that Opec and non-Opec members could take actions to stabilise the situation on the oil markets "without touching the fundamental market principles".
  • 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 "It is a shared task," he said, praising participants for showing "sense and flexibility". He predicted that the volatility on oil markets "will continue to be at a high level but in time it will decrease." Novak told reporters after his appearance in a plenary session that it was most sensible for Russia to consider a six month freeze in production that could then be further extended if necessary. A year long freeze would be "rather a long time", he said. 'Broad consensus' The secretary general of Opec Mohammed Barkindo, described the Algiers agreement as a "turning point" and hailed the greater coordination with non-cartel members like Russia. "We have restored the broad consensus among all producers," he said. Following the mismatch of supply and demand that drove up prices, he said there was an "overhang" of high stock inventories "rising to levels we have never seen before." "In order to restore stability we need to -- with our non-Opec friends - to address the issue of this overhang." "Until we address this, we will not achieve the fair (oil) price." In a sign of the growing cooperation between Russia and Opec, Novak held talks with the energy minister of the cartel's kingpin Saudi Arabia on the sidelines of the congress, both sides said. The Saudi energy ministry said the talks between Novak and Khalid al-Falih were the latest step in "the ongoing process of cooperation aimed at expediting the rebalancing underway in global oil markets." "The ministers emphasised that their two countries are committed to working together and with other producers, Opec and non-Opec," it said, adding the pair would hold more talks in Riyadh later this month.
  • 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 NewBase 12 October 2016 Khaled Al Awadi NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE Oil edges up before producer talks on output curbs Reuters + NewBase Crude futures inched up on Wednesday, with investors waiting for talks between OPEC producers and other oil exporters on curbing output to end a glut in the global market. Brent crude was up 9 cents at $52.50 a barrel at 0012 GMT. It fell 73 cents, or 1.4 percent, to close at $52.41 a barrel on Tuesday, retreating from a one-year high of $53.73 hit on Monday. U.S. West Texas Intermediate (WTI) crude had gained 3 cents to $50.82 a barrel. It dropped 56 cents, or 1 percent, to settle the previous session at $50.79. Oil has rallied more than 13 percent in less than two weeks since OPEC proposed its first production curbs in eight years. But prices remain about half of mid-2014 highs above $100 a barrel as questions remain over when the market will return to balance. OPEC will hold talks with non-member oil producers on Wednesday to try to thrash out details of a global agreement to cap production for at least six months as Russia lent its support for the plan. Global oil supply could fall in line with demand more quickly if OPEC and Russia agree to a steep enough cut in production, but it is unclear how rapidly this might happen, the International Energy Agency said on Tuesday. Goldman Sachs added its doubts on Tuesday, saying in a research note that the planned oil output cut by OPEC and other exporters has become a "greater possibility," but warned a production cut likely won't be deep enough to re-balance markets in 2017. Oil price special coverage
  • 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 Oil Price Holds Above $50 Oil held above $50 a barrel amid uncertainty over Russia’s willingness to join OPEC efforts to stabilize the market. Futures were little changed in New York after declining 1.1 percent Tuesday. Russia’s largest producer Rosneft PJSC said it won’t reduce output, according to Reuters, after President Vladimir Putin had earlier said his nation would join the Organization of Petroleum Exporting Countries in limiting production. The comment from Rosneft Chief Executive Officer Igor Sechin doesn’t contradict Putin’s stance on a supply deal, Kremlin spokesman Dmitry Peskov said. Oil rose to a 15-month high Monday after Saudi Arabia expressed optimism that a deal could be finalized to cut output and Russia signaled support. While Saudi Arabia’s oil minister left Istanbul before a producer meeting Wednesday, OPEC Secretary-General Mohammed Barkindo said most of the work on an accord was already done and countries including Russia, Azerbaijan, Algeria and Venezuela will still meet to “compare notes.” OPEC supply quotas will be decided at the group’s official gathering late next month in Vienna. “The lead up to the November OPEC meeting could see some volatility amid doubts about a supply deal,” said Angus Nicholson, a market analyst in Melbourne at IG Ltd. “I don’t think a drop below $45 is likely given the potential upside shock of a supply agreement coming together.” West Texas Intermediate for November delivery was at $50.90 a barrel on the New York Mercantile Exchange, up 11 cents, at 10:09 a.m. in Hong Kong. The contract declined 56 cents to $50.79 on Tuesday, falling from the highest close since July 2015. Total volume traded was about 70 percent less than the 100- day average. Brent for December settlement rose 21 cents to $52.62 a barrel on the London-based ICE Futures Europe exchange. The contract dropped 73 cents to $52.41 on Tuesday. The global benchmark was at a $1.28 premium to December WTI.
  • 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 NewBase Special Coverage News Agencies News Release 12 October 2016 Shale gas not EPA has pushed decline in coal-generated electricity Oil & Gas - Staff Writers Data shows benchmark gas prices ('Henry Hub' prices) in the past four years to be cheaper than coal from Appalachia for over 88% of the months. Even the cheapest coal, in Wyoming's Powder River Basin, competes poorly in generating power in the great population centers east of the Mississippi once rail transport of $0.03 per ton-mile is considered. Image courtesy of The electricity Journal. Cheap shale gas produced by fracking has driven the decline in coal production in the United States during the last decade, researchers at the Great Lakes Energy Institute at Case Western Reserve University have found. Power plants, which use 93 percent of the coal produced nationally, have been operating under the same EPA regulations signed into law by President George H.W. Bush in 1990. Proposed new rules since then have all been challenged in court and not implemented until June 2016, when the EPA's restrictions on mercury and other toxic emissions were approved by the U.S. Supreme Court. Consumption of coal continued to grow under those 1990-era EPA rules until 2008, and then went into steady decline, dropping by 23 percent from 2008 thru 2015. The data show the drop in those years to be correlated with the shale revolution, as natural gas production increased by a factor of more than 10 and its price dropped in half, the researchers say. And, due to the continuing--and in some cases accelerating--technological and economic advantages of gas over coal, the decline in coal is expected to continue at least decades into the future. Their study is published in The Electricity Journal. "Some people attribute the decline in coal-generated electricity to the EPA's air-quality rules, even calling it 'Obama's war on coal,'" said Mingguo Hong, associate professor of electrical engineering and computer science at Case Western Reserve and co-author of the study.
  • 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 "While we can't say that the EPA rules have no impact--as, for example, discouraging the building of new coal power plants because of the expectation that tougher air-quality rules will clear the courts--the data say the EPA rules have not been the driving force." Hong, co-director of the Electricity Systems Research Lab at Case Western Reserve, and Walter Culver, a founding member of the Great Lakes Energy Institute Advisory Board at the university, say the data show that shale-gas competition is what's been hurting coal as of today. They expect that, as wind and solar sources of electricity continue to improve, they will be tough competitors to coal in the not-distant future. The authors examined data available from the U.S. Energy Information Administration, academia, specialized energy consultants, and Wall Street analysts and publically available information of the electric utilities and gas industry--in some cases down to the profit and loss statements. "If you're a power plant operator and you see gas supply is continuing to increase and natural gas can do the job cheaper--by a lot--the decision to switch from coal is pretty easy," Culver said. The long-term outlook "As we look toward the future, we see no natural mechanisms that will permit coal to recover," Culver said. Gas supply continues to grow. Starting in 2009, gas production each year has exceeded U.S. Energy Information Administration (EIA) annual projections. And the proved gas reserves are outpacing production exponentially, the researchers note. Lastly, pipelines out of Appalachia-- where the cheapest and most abundant shale gas is found--are expected next year to increase access to gas in that region by 55 percent above recent production. There is a valid concern that the supply of natural gas will be limited by a recent debilitating drop in prices that has arisen from over-supply, Culver said. In fact, one driller per month has gone bankrupt in 2015 and early 2016.
  • 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 But after reviewing the profit-and-loss statements of gas drillers, the researchers believe that a point of price stability exists where both the drillers can be profitable enough to keep drilling and the price to power plants--particularly for gas from the Marcellus and Utica shale deposits in Appalachia--will still be far lower than coal. Some analysts suggest that exports of liquefied natural gas (LNG) will drive down the domestic supply and raise prices. But Hong and Culver say shipping costs, to Asian markets in particular and well-positioned regional competitors, are likely to prevent U.S. LNG from competing easily internationally. That would leave a strong supply here at attractive prices. Beyond gas price, state regulations and generator technologies have been and will continue to be factors in the loss of coal production, they conclude. Since 2010, the cost of utility-scale solar power has declined 68 percent and onshore wind 51 percent, making them close to, or already competitive with coal, the researchers say. Policies in three-quarters of America's states encourage the addition of wind and solar as replacements for coal. As costs have dropped, some states are pushing a faster switch to those renewables. Because wind and solar fail to provide constant power, fill-in energy sources are needed. Until large-scale batteries or other electricity-storage technologies become more practical, gas is the logical choice over coal to augment the grid, Culver says. Gas plants can be fired up and turned down faster than coal plants, thus lowering costs to consumers and producing less pollution. Forthcoming EPA air-quality regulations may further disadvantage coal, Hong and Culver say. Burning natural gas, for instance, produces no mercury emissions, half the carbon dioxide of coal and 80 percent less sulfur.
  • 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 BP Sees Oil Demand Growth Swamping Impact of Electric Cars Anna Hirtenstein ahirtens Rising demand for oil over the next two decades is likely to overwhelm the impact of the electric car on crude markets, said Spencer Dale, chief economist for BP Plc. “They’ll have a huge impact in terms of air quality, but it’s not a game changer over 20 years even with aggressive electric vehicle penetration,’’ Dale said at in a panel discussion at the Bloomberg New Energy Finance summit in London on Tuesday. The clean-energy research unit of Bloomberg LP estimates that battery-electric vehicles, which only run on power from a plug, will displace 13 million barrels of oil a day by 2040. BP projects oil demand to increase by about 20 million barrels a day over the next 20 years, with about a quarter of supply going to passenger vehicles. Dale’s comments illustrate why major oil companies don’t see electric cars as a threat to their business -- even with BP’s forecast that 70 million of them may be on the road in two decades. Efficiency gains such as improved fuel economy may have more of an impact on oil demand than electrified transport, he said, noting mileage standards and better engines would have “many times greater’’ impact on oil demand. “I do think sometimes that perhaps if our objective has to do with climate, perhaps we should spend more time on how to encourage and capture those improvements in efficiency rather than on EVs,’’ he said. “If I had some subsidies to use, I’d ask if it’s always best to encourage a switch from internal combustion engine to electric vehicle or better internal combustion engines? Bigger bang for your buck.’’ BP anticipates electric vehicles will have a bigger impact from 30 to 50 years into the future. That could happen sooner if social preferences shifted to favor use of electric cars, Dale said. “Suppose people start buying EVs because of what it says about them, rather than the economics,” Dale said. “All the economic modeling we do may get thrown out the window.’’ Coal Miner’s CEO Calls Tesla a ‘Fraud’ The head of the biggest privately owned U.S. coal producer on Monday called electric-car maker Tesla Motors Inc. a “fraud” for failing to turn a profit despite subsidies. Elon Musk, the billionaire chief executive officer of Tesla, fired back at Murray Energy Corp. CEO Robert Murray within hours on Twitter. Real fraud going on is denial of climate science. As for "subsidies", Tesla gets pennies on dollar vs coal. How about we both go to zero? 6:23 PM - 10 Oct 2016
  • 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 In his post, Musk said Tesla gets “pennies” on the dollar in subsidies compared with the coal industry, and that climate science denial is the “real fraud.” The verbal sparring between Murray and Musk comes as seismic changes in energy policy and competition from natural gas have pummeled coal miners, leading to bankruptcies and record production cuts. Meanwhile, the presidential election has underscored differences between Republicans and Democrats in their approaches to federal energy regulations and spending. In his interview with CNBC on Monday, Murray said Tesla was an example of the many companies collecting subsidies through energy policies supported by Democratic presidential nominee Hillary Clinton. “Here again, it’s subsidies, and Hillary Clinton said they need government help,” he said. Murray added that such policies were about Clinton “supporting her friends” rather than protecting the environment, and that the shutdown of all U.S. coal plants would do nothing to fight climate change. Murray Energy announced earlier this summer that it was considering cutting more than 4,000 jobs, accounting for about 80 percent of its workforce, amid weak coal prices. SolarCity Buy For its part, Tesla was downgraded to neutral from a buy rating by Goldman Sachs Group Inc. last week. The company’s shares have dropped as it moves forward with its plan to buy rooftop solar installer SolarCity Corp., which some analysts have deemed a risky bet. Musk is chairman of SolarCity, and his cousin Lyndon Rive serves as its chief executive officer. Customers who purchase an electric vehicle can claim a $7,500 federal income tax credit and several states offer additional incentives, according to Tesla’s website. Tesla will let Musk’s tweet “stand as a comment,” spokeswoman Alexis Georgeson said in an e-mail. The Clinton campaign didn’t immediately respond to a request for comment.
  • 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 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 26 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 12 October 2016 K. Al Awadi
  • 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