New base 580 special 12 april 2015

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 12 April 2015 - Issue No. 580 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
GCC countries urged to invest in nuclear, solar
energy to lessen dependence on oil
Gulf countries should invest in nuclear and solar energy to cushion the impacts of growing
domestic oil consumption costs for power generation and water desalination, an industry expert said.
Dr Mamdouh G Salameh, director of the Oil Market Consultancy Service,
made the statement in a forum entitled “The Iranian Nuclear Agreement:
Regional and Global Repercussions” organised by the Arab Centre for
Research & Policy Studies at the Ritz-Carlton Hotel in Doha yesterday.
In his presentation, Salameh said, “Arab Gulf countries consumed 6 million
barrels per day (mbpd) of oil or 31% of their oil production to generate
electricity and power water desalination plants.”
He noted that there are currently 199 desalination plants of varied
capacities in the Gulf Co-operation Council (GCC) region. Most of these desalination plants are
powered by oil, and there are plans to add 38 more facilities in the future, Salameh added.
“This means that the GCC countries will have to cut their domestic oil consumption drastically or
replace oil by nuclear power and solar energy in electricity generation and water desalination.
“Failing to do either would result in their relegation to minor crude oil exporters by 2030 or
ceasing to remain oil exporters altogether by 2032,” Salameh stressed. According to Salameh,
“Arab Gulf countries could be a formidable economic bloc” with proven reserves of 645bn barrels
or 39% of the world’s proven reserves and a combined GDP exceeding $1.9tn (at current prices).
“Their Achilles heel is their continued dependence on the oil export revenues to the tune of 85%
to 90% and their vulnerability to any decline in oil prices.
“However, the greatest threat to their oil-
dependent economies actually comes from the
steeply-rising domestic oil consumption for
power generation and water desalination and a
lack of diversification,” Salameh explained.
To prevent this, he stressed that Gulf countries
should accelerate the diversification of their
economies. Speaking to Gulf Times on the
sidelines of the event, Salameh further explained
that diversification “also means heading towards
that direction as a unit and not as a single GCC

country. All of them must go together because that gives them more strength.”
Salameh clarified that his definition of diversification
does not refer to industrialisation or “investing in
hotels, casinos, and real estate.” Instead of competing
with leading industrial nations, he suggested that Gulf
countries should invest in food production projects in
countries like Sudan by transforming it into the
region’s food basket.
“The world is already heading towards a future food
shortage on a global scale. In the future, food prices
could rival, if not, exceed those of crude oil. “Why not
then invest in Sudan, which has the land and water
resources not only to become the food basket of GCC
countries but also a great source of food export
revenues for them,” Salameh said.
Asked for other suitable countries for food security,
Salameh cited China and North Korea as some of the countries that have already invested on
agricultural lands in Africa. “But Sudan is an Arab country. It is a poor country but at the same
time, it has the third biggest Arab land in the world with a good source of water from the Nile
River, making it the ideal place for Arabs to invest in food security,” Salameh added.

Pakistan Grants Five Year Tax Holiday for LNG, Gas Import Projects
Natural Gas Asia + NewBase
Pakistan’s Economic Coordination Committee (ECC) on Thursday extended five year tax holiday
for LNG and gas import projects, reported local newspaper The News International. ECC also
extended 23-year tax holiday for Gawadar Port by giving it the status of Gwadar Port free zone as
requested by China Overseas Port Company Ltd.
Other decision that the ECC took was that Pakistan’s Oil and Gas Regulatory Authority (OGRA)
would determine the price of LNG on a monthly basis without going through the process of public
hearing, the newspaper reported.
Earlier this month, Pakistan received its first ever shipment of LNG from Qatargas. Qatar sold the
LNG cargo to Pakistan State Oil Company Limited (PSO), Qatargas announced on April 4.
The LNG cargo was sold on a free-on-board basis and loaded at Ras Laffan Port on to the LNG
vessel Excelerate Exquiste on 21 March 2015. The cargo was secured to commission the
Excelerate Exquiste, the Floating Storage and Regasification Unit, a part of the Elengy LNG
terminal which is the first Pakistan LNG import terminal, Qatargas said.
Also, China Petroleum Pipeline Bureau (CPP) is soon expected to begin laying 700 km Gwadar-
Nawabshah gas pipeline in Pakistan on government to government basis. CPP would bring the
required capital of $1.5 billion and will also construct the LNG terminal in Gwadar, costing $800
million. The terminal, which is likely to be offshore, will have a capacity of 500 mmcfd of LNG.
KARACHI: A shipment of 147,000 cubic feet of Liquefied Natural Gas (LNG) from Qatar arrived at
the Karachi anchorage today in a Floating Storage Regasification Unit (FSRU). The FSRU, after
going through clearance, is expected to dock at Engro Corporation's Elengy Terminal Pakistan
Limited (ETPL), where the cargo will undergo 'regasification' before being injected into the Sui
Southern Gas Company Ltd (SSGCL) network.
The FSRU will take approximately five hours to reach the terminal, and will begin offloading the
cargo at 6:30pm this evening, an official said.

Equatorial Guinea:WorleyParsons chosen as for FLNG
Ophir + NewBase
WorleyParsons said it has been awarded by Ophir Equatorial Guinea (Block R)
an agreement for provision of engineering and project management services for their
Equatorial Guinea Block R project (The Fortuna project).
Also awarded by Ophir Holdings is a master services agreement to provide engineering support to
any of Ophir’s worldwide assets, Worley Parsons said in a statement.
Block R is a gas development located offshore Equatorial Guinea 140km southwest of
Bioko Island and covers an area of 2,450 sq. km with water depths ranging from 1400m to 1900m.
Ophir and its partners are planning to develop the gas reserves through phased installation of a
20 well subsea production system supplying dry gas to a locally moored FLNG facility with a
capacity of 3 MTPA.
The scope of engineering and project management services provided by WorleyParsons and
its specialist deepwater division, INTECSEA, includes overseeing the front end engineering
and design scopes and tendering and evaluation of related engineering, procurement,
construction, installation and commissioning packages.

Norway:Faroe Petroleum finds gas at Skirne East (Shango)
Source: Faroe Petroleum
Faroe Petroleum has announced the results of the Total-operated Skirne East exploration
well (Faroe 20%) in Norway.
Highlights:
• The Total E&P Norge operated Skirne East exploration well 25/6-5S, in the Norwegian
North Sea is a gas discovery, which encountered a net 10 metre gas column in the high
quality Middle Jurassic Hugin formation
• The preliminary volumetric gross estimate of the size of the discovery is 3 to 10 million
barrels of oil equivalent ("mmboe") recoverable (0.6 to 2.0 mmboe net to Faroe)
• The partnership will now consider the potential for development of the Skirne East
discovery.
Exploration well 25/6-5S has encountered a net gas-bearing reservoir section estimated at 10m
in the Middle Jurassic Hugin formation, confirming hydrocarbons at the same reservoir level as in
the adjacent producing Skirne field. Reservoir properties were found to be excellent and
extensive data
gathering has been
conducted. The
preliminary
resource estimate
for the Skirne East
discovery is in the
range of 3 to 10
mmboe gross (0.6
to 2.0 mmboe net
to Faroe).
The Skirne East
exploration well
25/6-5S spudded
on 13 March 2015
and was drilled to a
total depth of 2,366
metres below sea
level. The Skirne
East discovery in
Licence PL 627 is located in the Norwegian North Sea on the northern part of the Utsira High
approx. 5 kms from the Total operated producing Skirne field. The partners
are Total(40%), Centrica Resources Norge (20%) and Det norske oljeselskap (20%). The
Skirne East exploration well will now be plugged and abandoned as planned.
Graham Stewart, Chief Executive of Faroe Petroleum commented:
'We are pleased to announce the result of the Skirne East well which, although smaller than
predicted, is a promising discovery particularly in light of the nearby Atla field which was recently
developed with reserves within the resource range of the Skirne East discovery. During the
coming months we expect to start drilling the first of two follow-up wells at the significant Pil
discovery (Faroe 25%) on the Blink and Boomerang prospects, and also the Bister prospect to
follow up on our recent significant Snilehorn discovery located close to the producing Njord field
infrastructure.

UK: Iona Energy reports Huntington field ready for full ramp up
Source: Iona Energy
Partner Iona Energy, a Canadian independent oil and gas company with assets in the UK North
Sea, has made the following operational update regarding production from the EON-
operated Huntington field.
The Huntington field has been operating under gas export rate restrictions since October 2014
which has reduced the rate of oil production from the field. The Company has been advised by
the Huntington field operator, EON, that the CATS operator has confirmed a resumption of
normal operations. Management of Iona understands that different fields which use CATS are
being brought on line. EON has confirmed to Iona that the Huntington field is ready for full ramp
up when unrestricted access to CATS is made available. Iona will update the market when that
occurs.
Iona's net production (Huntington 15%, Trent & Tyne 20%) for the first three months of the year
is shown in the table below.
The increasing Huntington production rate over the 3 months period was delivered by two wells
which were choked back to comply with prevailing restrictions. The availability of the Huntington
FPSO has been excellent through the first three months of 2015.

Global Trends in Power Generation 2015-2035
(http://www.researchandmarkets.com/research/whkx9x/global_trends_in)
has announced the addition of the "Global Trends in Power Generation" report to their offering.
This research service explores the rising energy demand across the globe and analyzes the key
energy resources that will be
increasingly used, up until
2035.
It explores the drivers and
restraints of key energy
sources such as coal, gas, and
renewables, and features a
short discussion of the key
geographical trends influencing
the growth of the energy
market. A brief snapshot of the
utilization of gas plants
in Europe, focused mainly on the United Kingdom and Germany, is followed by a summary of the
key findings of the top three energy resource markets, namely, coal, gas, and renewables.
Gas will increasingly replace coal in OECD countries as commercial carbon dioxide capture and
storage (CCS) is a long way off. In non-OECD markets, investment will be undertaken in both gas
and coal. Oil is expected to be slowest growing fuel (heavy fuel oil [HFO] will be used as a
reserve fuel in most countries) over the forecast period. Renewables are likely to exhibit strong
growth across geographies.
Key Topics Covered:
1. Global Trends in Power Generation
- Executive Summary-Key Trends in the Global Economy
- Executive Summary-Global Energy Consumption Snapshot Till 2035
2. Power Generation
- Global Energy Demand Set to Grow Over the Next Decades
- Gas Generation to Significantly Increase but Coal will Dominate up to 2030
- Power Generation-Installed Capacity Fuel Mix - Global Power Generation Fuel Mix
3. Coal Market
- Drivers and Restraints for the Coal Power Market - Geographical Trends in Coal Generation
4. Gas Market
- Drivers and Restraints for the Gas Power Market - Geographical Trends in Gas Generation
- Low Utilization of Gas Plants in Europe - Declining Loads of Gas Plants-United Kingdom
- Declining Loads of Gas Plants-Germany
5. Renewables Market
- Drivers and Restraints for the Renewables Market - Geographical Trends in Renewable Market
6. Other Markets and Industries
- Power Plant Financing is Becoming a Greater Challenge - Chinese Equipment and Finance Driving Success
in Europe
For more information
Visit
http://www.researchandmarkets.com/resea
rch/whkx9x/global_trends_in

PetroChina Catches Exxon as World’s Most-Valuable Oil Company
Bloomberg + NewBase
PetroChina Co. passed Exxon Mobil Corp. today as the biggest energy company by market value
for the first time since 2010.
As the attached chart shows, Exxon’s capitalization was $352.6 billion through yesterday,
compared with PetroChina’s $352.8 billion as of 1:36 p.m. on Thursday in Shanghai. The Chinese
company’s A shares surged about 61 percent the past year, versus Exxon’s 14 percent drop.
PetroChina was larger by value most recently at the close of trading on June 25, 2010, data
compiled by Bloomberg show.
The Shanghai Composite Index has gained about 88 percent over the past year, the best
performance among major indexes tracked by Bloomberg, amid speculation the central bank will
extend cuts in borrowing costs and on increased use of leverage to buy stocks. The Chinese yuan
has declined 0.1 percent versus the dollar the past year even as most currencies weakened.
“PetroChina has multiple positives at the moment: it’s got a reform story, it’s also listed in Hong
Kong, and China has more freedom for mainland fund managers in the works,” said Mark
Matthews, head of Asia research and a managing director of Bank Julius Baer & Co. in Singapore.
“China is also planning to transfer stakes in state-owned enterprises away from their regulator,
which will on the whole be positive for SOEs.”
Earnings of both companies have been squeezed by the plunge in the price of oil. Exxon’s
adjusted net income of $6.3 billion in the fourth quarter was the lowest since a loss in the final
three months of 2009, according to data compiled by Bloomberg. PetroChina’s profit was 11.1
billion yuan ($1.8 billion) in the same period.
Almost all the operating profit in 2014 of PetroChina, which is 86.5 percent owned by state-
controlled China National Petroleum Corp., came from the exploration and production sector, with
small contributions from its natural gas and pipeline unit. The refining and chemicals unit had an
operating loss last year.

Oil Price Drop Special Coverage
aded
Iran’s return to market to delay oil price recovery
Syed Rashid Husain + NewBase
With Iran and the West reaching an understanding on the nuclear issue, questions about impact of
the deal on Iran’s crude output and the global energy balance continued to confound the pundits.
Speculation is rampant, adeal would result in further softening of the crude markets. But the
question is if yes, then, to what extent?
If oil-related sanctions against Iran are lifted, world oil prices next year could be $5 to $15 a barrel
lower than the current forecasts, the US Energy Information Agency is now saying. In its latest
short-term energy outlook released last week, the agency left its current price forecasts
unchanged, putting Brent at $59 this year and $75 a barrel next year underlining downside risks
from Iran’s return. “A lifting of sanctions against Iran, should a comprehensive nuclear agreement
be concluded, could significantly change the forecast for oil supply, demand, and prices,” EIA
Administrator Adam Sieminski said in a statement.
It added that Iran is believed to hold at least 30 million barrels of crude in storage, and that the
nation could ramp up crude production by at least 700,000 barrels per day (bpd) by the end of
2016. Most analysts too agree that output would likely recover next year if and indeed when the
sanctions are eased.
Iran, the world’s fifth-largest oil producer, is claiming it could nearly double its exports from just
Brent oil prices traded last on end of day Friday
the 10th
April 2015 at 57.9 U$D/B

over 1 million barrels per day (bpd), in two months once sanctions are lifted. Most analysts though
are of the view; doubling the exports would take longer.
As per the International Energy Agency estimates, Tehran is currently producing 2.8 million bpd.
Unconstrained by sanctions, however, it is of the view that Iran could increase that to 3.6 million
bpd, in as few as six to 12 months.
However, in order to go beyond 3.6 million bpd, it would need foreign investment. A decade ago, it
was able to pump 4.5 million bpd and output peaked at about 6 million bpd in 1974. Consequent
to the Washington-led sanction on Iran’s oil industry, however, Tehran’s oil exports was cut down
by more than half to around 1.1 million bpd from a pre-sanctions level of 2.5 million bpd.
Now with the possibility of the sanctions being lifted, Iran is looking to ramp-up its exports and
rather quickly. Iran’s Oil Minister Bijan Zanganeh has been meeting Western oil executives
discussing their return into the Iranian oil sector, once sanctions are lifted. The oil majors
Zanganeh met in Vienna during his last Opec outing included Italy’s Eni, Royal Dutch Shell and
Austrian oil and gas group OMV.
In order to achieve its immediate objectives, Iran is also seeking to resolve differences with
Chinese energy companies. Iranian officials were in China last week to discuss Chinese
investments in oil and gas developments in Iran, as well as oil sales. Iran also wanted the Chinese
companies to use the latest technology and equipment in any resumption of work to get fields
pumping, Amir-Hossein Zamaninia, Iran’s deputy oil minister for commerce and international
affairs was quoted as saying.
The officials were soon followed by a visit to Beijing, the world’s largest crude importer, by Iranian
Oil Minister Bijan Zanganeh, his first since assuming his post two years ago. This flurry of visits to
Beijing from Tehran is to be seen in the backdrop of the fact that some of the enhanced output is
expected to come from projects that the Chinese state companies China National Petroleum
Company (CNPC) and Sinopec Group have contracted to develop.

China’s investments in Iran include projects such as the $4.7 billion development of the giant
offshore South Pars gas field and the North Azadegan and Yadvaran oilfields. Activity on these
developmental projects were stalled o r scaled back in late 2010 as Western sanctions tightened.
Among oilfields Chinese companies have worked on, the Yadavaran project has progressed
relatively well, with 95 percent of the work completed and the field, operated by Sinopec, ready
from about September, Zamaninia added. He further said the field, in the southwestern province
of Khuzestan, once developed will have a 75,000 bpd capacity in phase one. Sinopec agreed in
late 2007 to a $2 billion deal to develop the field. CNPC, China’s top energy group, has an
agreement to take on other projects, including a $2 billion contract to turn North Azadegan into a
120,000 bpd field.
Iranian officials are now saying that CNPC, which pulled out of Iran’s giant South Pars natural gas
field in 2012, now seems interested in returning to the offshore project. Iran was also China’s
sixth-largest crude oil supplier last year, behind Saudi Arabia, Angola and others, with sales up 28
percent from 2013 to 27.46 million tons, or about 550,000 bpd, according to Chinese customs
data. Iran now wants the volume of sales to Beijing to go up too. A new condensate deal between
Zhuhai Zhenrong and NIOC is set to lift China’s total crude oil contract volumes to above 600,000
bpd later this year.
However, Iran’s full return to the oil markets may not be very easy and straightforward. It would be
hindered by strong competition for investment dollars from rival producers including Iraq, Mexico
and Brazil, among others, Javier BlasBradley Olson underlined in his story on the issue.
In a world of surplus supply, prices hovering around $50 a barrel and deep cuts to capital
expenditures by oil companies, Iran will be challenged to find investors should it finalize a nuclear
agreement that leads to a lifting of sanctions.
Other jurisdictions have already seen super-major oil companies walking away as returns were
deemed inadequate. Exxon Mobil Corp. has rejected renewing a concession in Abu Dhabi
because of less attractive returns and BP Plc has told Mexico it needs better terms to attract
foreign investments as it reopens fields.
Even if all the obstacles are resolved, “negotiations could take a year” once sanctions are lifted,
Nader Sultan, who ran state-owned Kuwait Petroleum Corp. for over a decade, told an
interviewer.
Iran’s return as a dominant power in the international market place is “not going to be immediate,”
Gianna Bern, an energy consultant who teaches international finance at the University of Notre
Dame in Indiana was quoted as saying. “European companies such as BP that have a long
storied history in Iran are likely to take the first crack at coming back into the country, although
some may be wary initially.”
Tehran still has a long way to go! Yet one has to concede, the potential of additional barrels of Iranian
crude to the market holds the promise of delaying any substantial recovery in oil market prices.

Experts discuss impact of Iran nuclear deal in Doha forum
Gulf Times
A large group of speakers and subject matter experts gathered in Doha to discuss regional and
global repercussions of the Iranian nuclear agreement in a forum held at the Ritz-Carlton Hotel
yesterday.
Entitled “The Iranian Nuclear Agreement: Regional and Global Repercussions,” the forum was
organised by the Arab Centre for Research & Policy Studies (ACRPS) following the
announcement of the framework agreement between Iran and the P5+1 countries in Lausanne,
Switzerland, on April 3.
The P5+1 is a group of world powers namely, China, France, Russia, the UK, and the US, which
are permanent members of the UN Security Council. The other country is Germany. In 2006,
these countries joined the diplomatic efforts with Iran with regard to its nuclear programme.
The ACRPS said, “The framework agreement has brought more than 12 years of intense
international debate surrounding Iran’s nuclear programme to a close.
“The panellists will address the effects of the framework agreement on the balance of power within
Iran’s domestic political scene, as well as its impact on the region and the world at large.” The
centre added, “This agreement is a political watershed, which rules out the prospect for greater
developments related to Iran’s nuclear capabilities. It will also impinge on the balance of powers
within the Iranian regime, echo in the country’s relations with global powers, and inevitably have
repercussions of no lesser significance on the regional arena.”
The speakers in yesterday’s workshop included ACRPS general director Azmi Bishara, Iraqi
nuclear scientist Imad Khadduri, oil market consultant Mamdouh Salameh, ACRPS researchers
Abdulwahhab al-Qassab and Marwan Kabalan, Hagop Kevorkian professor Hamid Dabashi,
Saudi Arabian researcher Khaled al-Dakheel,
Brookings Institute Foreign Policy fellow Ibrahim Sharqieh, Jordanian researcher Fatima Smadi,
Georgetown University School of Foreign Service in Qatar assistant professor Birol Baskan,
ACRPS associate researcher Mahmood Muhareb, Qatar University Humanities department chair
Regional and Global Repercussions of the Iranian Nuclear Agreement Forum

Mahjoob al-Zweiri, and columnist and author Camelia Entekhabifard. The ACRPS also said while
the framework agreement guarantees Iran’s right to enrich uranium within its borders, it also
stipulates that Iran will abandon 98% of its present stockpile of enriched uranium, decommission
two-thirds of its centrifuges, restrict enrichment activities to the reactor at Natanz, and convert all
other facilities to research labs. In return, international sanctions imposed on Iran will be lifted.
“Even if sanctions were lifted today, it will take Iran more than two years to deploy the enhanced
oil recovery (EOR) technology and try to increase production. Even then it might only succeed in
limiting the fast depletion in its oilfields rather than increasing production,” said Salameh in his
presentation entitled “Oil and Iran’s Nuclear Programme: Impact on Oil Prices and the Global Oil
Market.”
He added that for the past 15 years Iran was unable to meet its Opec (Organisation of the
Petroleum Exporting Countries) production quota of 4mn barrels per day (mbpd).
“My view is that even if the sanctions are lifted and Iran was able to import the latest American oil
technology, Iran could add no more than 200,000 to 300,000bpd to its production but even this
may not translate into added exports because of the steeply-rising domestic consumption,”
Salameh stressed.
He added, “As a result, lifting the sanctions against Iran will hardly affect the global oil prices or
the global oil market against a projected growth in global demand estimated at 913,000bpd in
2015 and 1.13mbpd by 2016, according to the International Energy Agency.”

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
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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 12 April 2015 K. Al Awadi

New base 580 special 12 april 2015

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New base 580 special 12 april 2015