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NewBase Energy News 15 January 2024 No. 1690 Senior Editor Eng. Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Where are energy ties between the UAE and India headed?
The National - John Benny + NewBase
The latest renewable energy agreement between the UAE and India will further increase co-
operation between the two countries in areas such as clean energy, electricity grid connectivity and
green hydrogen, experts and officials have said.
Earlier this week, both countries signed initial agreements to expand bilateral investments in
renewable energy, food processing and healthcare sectors. The agreement aims to invest in
renewable energy projects i n India, pote ntially reaching a total capacity of 60 gigawatts.
India’s Foreign Secretary Vinay Kwatra said one of the pacts was on renewable energy, which also
includes green hydrogen and solar. “There is an inherent thought of possible grid connectivity
between India and the UAE in that space,” Mr Kwatra told reporters at a summit in India’s
Gujarat state.
The preliminary agreement between the two countries would focus on combining new areas of
technology with renewable energy, Navdeep Suri, former ambassador of India to the UAE, said.
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“There are some really ambitious ideas that are being discussed, particularly in terms of trying to
connect grids in the two countries [and] there’s a fair bit of discussion on green hydrogen,” Mr Suri
told The National.
He also said the latest round of agreements could support the goals of the India-Middle East-Europe
Economic Corridor and the I2U2 economic co-operation grouping. The I2U2 group is a grouping of
India, Israel, the UAE and the US.
The trade corridor, which was announced at the G20 Summit in India in September, will originate in
India, connect the UAE, Saudi Arabia, Jordan, and Israel, and terminate in the EU.
It has called for the development of a mix of rail and sea links for physical connectivity and includes
plans for pipelines to transport hydrogen produced in Saudi Arabia and the UAE.
I2U2 was formed in 2021 following the Abraham Accords between Israel and the UAE, to deal with
issues concerning maritime security, infrastructure and transport in the region.
Less than a year after the group’s creation, the countries announced a partnership to advance a
300-megawatt wind-solar hybrid project complemented by a battery energy storage system in
Gujarat.
At the Cop28 climate conference last month, the UAE said it would develop 6.6 gigawatts of clean
energy capacity in India, including the construction of 1,200 megawatts of wind and solar projects.
The projects are expected to be financed using the Emirates’ $30 billion climate fund Alterra, which
is backed by major institutional investors such as BlackRock, Brookfield and TPG.
"It is a great sign to see both countries furthering their co-operation on the implementation front as
well,” said Gauri Singh, deputy director general at the International Renewable Energy Agency.
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“India possesses an incredibly attractive renewable energy market, thanks to its well-defined
policies and clearly outlined targets, while the UAE continues to demonstrate its commitment to
becoming a renewable energy leader,” Ms Singh told The National.
Attractive market
India, the world’s fifth-largest economy, aims to achieve net-zero emissions by 2070 and meet 50
per cent of its electricity requirements from renewable energy sources by the end of this decade.
The Indian government has estimated that the country’s shift to a low-carbon path will require more
than $10 trillion of new investments by 2070.
“Given its economic growth, demographics [and] size, [India] offers probably the best return on
investment,” Mr Suri said.
“When you look at the trajectories of the major countries in the region … India is outperforming most
of the others at this point of time and is projected to continue to outperform for the next several
years,” he added.
New Delhi has forecast annual gross domestic product growth of 7.3 per cent in the fiscal year
ending in March, the highest rate among the major economies, despite a global slowdown. Even
with the economic momentum, the country’s renewables ambitions are challenging.
India, the fourth-largest country in terms of installed renewable energy capacity, will need 40
gigawatts of wind and solar capacity to be added annually to reach its 450-gigawatt target by 2030,
according to Wood Mackenzie.
That would require an annual investment of $35 billion a year, the US-based consultancy said in a
report last year. India’s power ministry has projected renewable energy investments of about $16.5
billion for this year.
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"With solar and wind at grid parity, these technologies will scale up and constitute 80 per cent of the
new capacity additions in India, with demand coming from not only electric utilities, but also from
[the] industrial sector," Ankita Chauhan, associate director at S&P Global Commodity Insights,
told The National.
The signing of the initial agreement is in line with the past relationship between the two countries,
where the UAE's sovereign wealth fund, the Abu Dhabi Investment Authority (Adia), has invested
in several renewable energy assets and holds stakes in leading renewable companies in India, Ms
Chauhan said.
Adia has invested in two of India's largest renewable energy companies – ReNew and Greeenko
Group. However, coal, which accounted for nearly 75 per cent of India’s electricity in 2022, will
continue to play a significant role in the country’s energy mix as power demand soars.
India added an annual average of five gigawatts of coal-based electricity generation capacity from
2017 to 2022.
Connected power grids
India and the UAE have been in talks to connect their grids through undersea cables, according to
media reports. New Delhi has already signed an initial agreement with Saudi Arabia to co-operate
in the areas of electrical grid interconnection, clean hydrogen and supply chains.
Both countries will set up a general framework for co-operation in electrical interconnection and
electricity exchange during peak times and emergencies. When it comes to connecting the power
grids of India and the UAE, “you just have to negotiate a relatively small stretch of the Arabian Sea”,
Mr Suri said.
For the Emirates, that is more
technologically and financially feasible
than a grid connected with China or
other emerging economies, he added.
Integrating regional power systems
boosts energy security, expands
access to clean, affordable electricity,
and allows diverse generation
capacities to meet demand and
maintain stability.
“If you can connect grids efficiently, then you don't need to invest that [much] in [energy] storage,”
Mr Suri said. “You can get over the hump of having plenty of power during the day but not enough
at night,” he said.
The UAE, Opec's third-largest producer, has been investing heavily in clean energy projects,
ranging from nuclear to solar, to achieve net-zero emissions by 2050.
The growing number of renewable energy projects also presented a favourable environment for
project financing, sustainable bonds, and other investment tools that promote environmental, social
and governance (ESG) principles, Vikas Lakhwani, chief revenue officer at CPT Markets, said.
“The financial implications [of the UAE-India agreement] are far-reaching, creating exciting
opportunities for investors, developers, and financial institutions across the spectrum,” he said.
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Saudia: Deals worth $7bn signed on 1st day of FMF24 in Riyadh
OGN/TradeArabia News Service
The first day of the third edition of Future Minerals Forum (FMF) saw the signing of 20 agreements
and memorandums of understanding worth a total of SAR27 billion riyals ($7 billion) between
government agencies, companies and other organizations participating in the Forum.
These included agreements connected with mining exploration, technology and communications,
as well as the application of sustainability standards, localization, qualification and industrialization
in the minerals sector.
Also, unveiled at the Forum, taking place in Riyadh's King Abdulaziz International Conference
Center, were details of the 33 sites available for exploration this year, and the first mining belt to be
made available for exploration in the region at Jabal Sayid, an area of 4,000 square kilometers.
The signing ceremony was attended by the Minister of Industry and Mineral Resources, Bandar
AlKhorayef the Minister of Investment, Khalid Al-Falih, the Minister of Transport and Logistics
Services, Saleh Al-Jasser, the Vice-Minister of Industry and Mineral Resources for Mining Affairs
Khalid Al-Mudaifer, and Sulaiman Al-Mazrou, CEO of the National Industrial Development and
Logistics Services Program.
Among the government agencies and private sector participating in signing these agreements and
memorandums of understanding were Saudi Arabia’s Ministry of Industry and Mineral Resources,
the Ministry of Investment, the Royal Commission for Jubail and Yanbu, the Saudi Geological
Survey, the Saudi EXIM Bank, and the Saudi Mining Polytechnic (SMP).
Among those signing the agreements were the Saudi Mining Services Company, Moxico Ajlan &
Bros Mining, Aramco, Al-Haytham Mining Company, Manara Minerals, Vale, the Geological Survey
of Finland, Maaden, Japan Organization for Metals and Energy Security, SABIC, the Export-Import
Bank of the United States, Energy & Water Academy, and the Al Fada Anode Production Company.
The third edition of FMF began this morning (10 January) at the King Abdulaziz International
Conference Center (KAICC) with more than 16,000 participants from 145 countries in attendance,
as well as 250 speakers.
Over the course of two days, the Forum will address some of the most pressing issues for the
minerals sector. --
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China’s Drive for Record Coal Output Spurs Yet Another Deadly Accident
Bloomberg News
The human toll of ever-increasing coal production in China is once again to the fore after thirteen
were killed in a mine accident just days after the government said it will start a three-year campaign
to ensure safety.
Three people are still missing after a gas outburst at a mine run by a unit of Pingdingshan Tianan
Coal Mining Co. in the central province of Henan on Friday, according to a release from the company
on Sunday. Managers at the mine were taken into police custody and the authorities have ordered
other operations in the area to halt production for safety checks, the local government said in
another statement.
China’s coal output continues to set records as Beijing has moved to ensure that seasonal peaks in
demand are covered and blackouts avoided after the economy-crippling outages of recent years.
That’s kept supplies ample and prices low, but success has come at a cost.
Miners have been unable to raise production without incurring accidents, and the latest incident is
likely to curtail output in the first few months of this year. The Henan disaster continues a horrible
run that’s included 23 deaths at two mines in Heilongjiang in the last two months. Another 26 died
at a fire in a miner’s building in Shanxi province in November, while a fire at a mine in Guizhou killed
16 in September.
In February, a landslide at an open-pit mine in Inner Mongolia left 53 dead, the nation’s deadliest
industrial disaster since 2019.
More miners are expected to opt for slower production heading into the Lunar New Year after the
incident, Cinda Securities Co. said in a note. The output cuts will mainly affect metallurgical coal
used by the steel industry, it said, although rising temperatures and the seasonal lull in steel
production should limit the impact on coal prices broadly.
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Pingdingshan Tianan is the listed arm of China Pingmei Shenma Holding Group, the biggest met
coal supplier in central China, according to a report by the Securities Times. The firm invested 7
billion yuan ($976 million) in improving safety controls after being fined 240 million yuan for violations
over the past three years, the report said.
Pingdingshan fell as much as 5.5% in Shanghai, while coking coal futures in Dalian rose as much
as 1.8%.
The Pingdingshan mine has an annual capacity of 1.5 million tons, according to Morgan Stanley
analyst Sarah Chan. Together with the incidents in Shanxi and Heilongjiang, the bank expects
further restrictions on output nationwide and “safety inspections to remain a key focus in coal-
producing regions through March at
least.”
Morgan Stanley said 12 million tons of
capacity has been taken offline in Shanxi,
the top coal producing province, since
November. It said steady demand from
the steel industry should support met
coal prices in the first half of the year.
“Coupled with elevated steel output, we
see near-term upside to China met coal
prices given the tight inventory level in
the supply chain,” the bank said in a note
on Sunday.
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NewBase January 15 -2024 Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oil edges up as investors eye Mideast developments
Reuters + NewBase
Oil prices edged up on Monday as traders watched for supply disruption risks in the Middle East
following strikes by U.S. and British forces to stop Houthi militia in Yemen from attacking ships in
the Red Sea.
Brent crude futures were up 24 cents, or 0.3%, to $78.53 a barrel by 0825 GMT after settling 1.1%
higher on Friday. U.S. West Texas Intermediate crude was at $72.83 a barrel, up 15 cents, or 0.2%,
following a near 1% gain in the previous session.
The benchmarks jumped more than 2% last week to touch their highest intraday levels this year
after U.S. and British forces launched dozens of air strikes against Houthi forces in retaliation for
months of attacks on Red Sea shipping that the Iran-backed fighters cast as a response to war in
Gaza.
"There are supply risks for the market given the escalation in (the) Red Sea," said Warren Patterson,
head of commodities research at ING. "However, for now we are not seeing any impact on oil supply.
And I guess we would need to see significant escalation before that happens."
Oil price special
coverage
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On Sunday, the Houthi militia threatened a "strong and effective response" after the United States
carried out another strike overnight, ratcheting up tension. The U.S. later said it shot down a missile
fired at one of its ships from Houthi militant areas of Yemen.
President Joe Biden said the United States had sent a private message to Iran about the Houthi
attacks. Several tanker owners steered clear of the Red Sea and multiple tankers changed course
on Friday following the strikes, although traders were still watching out for Iran's response and
impact on shipments in the Strait of Hormuz, the world's most important oil chokepoint.
"As the Middle East conflict is currently not affecting oil production, the geopolitical risk premium
priced in oil prices now appears modest based on the implied volatility of options," Goldman Sachs
analysts said in a note.
"While unlikely to materialise in our view, we estimate that oil prices would rise 20% in the first month
of a Strait of Hormuz interruption, and may temporarily double in a less likely extended disruption."
In Libya, people protesting against perceived corruption threatened to shut down two more oil and
gas facilities after shutting the 300,000 barrel-per-day Sharara field on Jan. 7.
In the U.S., power and natural gas companies were preparing for extreme cold over the Martin
Luther King Day holiday weekend that was expected to cause record gas demand while also cutting
supplies by freezing wells.
The Texas power grid operator on Sunday issued an appeal to the public calling for energy
conservation.
Oil edged higher as the risk that airstrikes by the US and allies against the Houthis would ignite a
wider conflict and disrupt crude flows from the Middle East was balanced by soft fundamentals.
Brent crude rose toward $79 a barrel and West Texas Intermediate was near $73 after
the US followed up the initial strikes against targets in Yemen with a fresh attack on a
radar installation. While the global benchmark was up more than 4% at one point on
Friday, it ended the session with a relatively modest gain of 1.1%.
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Global oil markets have been transfixed by the situation in the Middle East since the Hamas attack
on Israel on Oct. 7. The strikes on the Houthis were in retaliation for the group’s harrying of ships in
the Red Sea over the last couple of months. The Iran-backed militants have vowed not to let up until
Israel ends its assault in the Gaza Strip.
The price reaction suggests the market doesn’t, at this point, see a high chance that the evolving
conflict will spread and endanger crude production and flows from the wider Middle East, which
accounts for around a third of the world’s oil. Instead, the prospect of rising supply from non-OPEC
countries and slowing demand growth looks to be taking precedence.
“For now, developments in the region are not having an impact on oil supply,” said Warren
Patterson, head of commodities strategy for ING Groep NV. “And in the absence of supply
disruptions, the oil market remains comfortable over the first half of the year, despite heightened
tensions.”
The setup for crude appears tough this year. While demand is still growing, it’s expected to do so
at a markedly slower pace as the post-pandemic rebound dissipates. There are also question marks
around whether production cuts announced by the Organization of the Petroleum Exporting
Countries and allies will be enough to offset an impending surplus.
Still, the increased tensions in the Middle East are disrupting crude flows to a certain extent. At least
three oil tanker owners, which between them marshal more than 350 vessels, said Friday they were
pausing voyages through the southern Red Sea. More are likely to follow suit after advice from
Western military forces that all ships should stay away from the area.
A vessel hauling Russian oil had a narrow miss with a missile fired from Yemen, according to the
UK navy. A Houthi-operated TV channel also said fighter jets had hit targets in a new strike on
Sunday evening, although there was no immediate confirmation from the US or UK militaries.
“As the Middle East conflict is currently not affecting oil production, the geopolitical risk premium
priced in oil prices now appears modest,” Goldman Sachs Group Inc. said in a note. Prices are likely
to be range-bound as high spare capacity caps the upside, while low recession risk and responsive
OPEC+ supply limit the downside, they said.
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EIA expect Henry Hub natural gas spot price to average under
$3.00/MMBtu in 2024 and 2025 …. Source EIA
Eia expect the U.S. benchmark natural gas spot price at the Henry Hub to average under $3.00 per
million British thermal units (MMBtu) in 2024 and 2025 in our January Short-Term Energy
Outlook (STEO).
The annual average Henry Hub prices in 2024 and 2025 increase from 2023 in our forecast because
we expect natural gas demand growth to outpace natural gas supply growth. Despite increased
demand, our forecast prices for 2024 and 2025 are less than half the annual average price in 2022
and are only slightly higher than the $2.54/MMBtu we reported for 2023.
After averaging just under $6.50/MMBtu in 2022, the Henry Hub price declined to $3.27/MMBtu in
January 2023, driven by warmer-than-average weather and reduced natural gas consumption in
most of the United States. The Henry Hub price remained relatively low for all of 2023 because
of strong natural gas production and more natural gas in storage.
EIA expect these drivers of low prices to continue over the next two years, as U.S. natural gas
production remains relatively flat but grows enough to set new record highs. In our January STEO,
U.S. dry natural gas production increases 1.5 billion cubic feet per day (Bcf/d) in 2024 from record
highs in 2023 to average 105.0 Bcf/d.
forecast dry natural gas production increases again in 2025 by 1.3 Bcf/d to average 106.4 Bcf/d.
Working natural gas inventories were above the previous five-year (2018–22) average for all of
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2023, and we expect inventories will remain above the five-year average in 2024 and 2025 because
of continued increases in natural gas production.
Note: In the annual total for 2023, November and December are STEO estimates. Supply is dry
natural gas production and imports. Demand is total natural gas consumption and exports.
EIA also expect U.S. demand for natural gas—total natural gas consumption plus natural gas
exports—to increase in 2024 and 2025, driven by growth in liquefied natural gas (LNG) exports,
which EIA forecast to increase by 4% (0.5 Bcf/d) in 2024 and 17% (2.1 Bcf/d) in 2025. Consumption
of natural gas in 2024 increases in the residential sector by 4% (0.5 Bcf/d) and in the commercial
sector by 3% (0.3 Bcf/d) because EIA expect colder winter weather than in 2023. Last year started
and ended with warmer-than-average temperatures.
In EIA forecast, U.S. consumption of natural gas in the electric power sector also increases modestly
in 2024 by 1%. These increases in consumption are partially offset by less consumption in the
industrial sector. U.S. consumption of natural gas in EIA forecast during 2025 is flat relative to 2024
levels in all sectors except for the electric power sector where we expect consumption to decrease
by 0.2 Bcf/d.
In 2024, EIA expect U.S natural gas demand to increase more than supply—dry natural gas
production plus natural gas imports—pushing up the average annual price in 2024 slightly.
However, we expect prices to stay relatively low in 2024 because of strong natural gas storage
inventories. EIA expect demand growth will exceed supply growth again in 2025, driven by more
LNG exports, putting upward pressure on prices in 2025.
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NewBase Specual Coverage
The Energy world –January 15 -2024
CLEAN ENERGY
We expect solar will supply almost all growth in U.S. electricity
generation through 2025 .. U.S. EIA, Short-Term Energy Outlook, January 2024
We expect solar electric generation will be the leading source of growth in the U.S. electric power
sector. In our January Short-Term Energy Outlook (STEO), which contains new forecast data
through December 2025, we forecast new capacity will boost the solar share of total generation to
5.6% in 2024 and 7.0% in 2025, up from 4.0% in 2023.
Note: Values for 2023 reflect historical data through October and estimates for November and
December.
The STEO includes two Between the Lines articles that discuss how our forecast for Brent crude oil
prices performed in 2023 and a closer look at our Brent price forecast for 2024 and 2025. We expect
U.S. crude oil and natural gas production growth to slow, but both continue to reach new records.
Other key takeaways from our January 2024 STEO include the following.
We believe that slower growth will still establish new annual records in U.S. crude oil and natural
gas production
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Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024
Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024
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OPEC+ production will probably stay below targets
We forecast OPEC+’s crude oil production will average 36.4 million barrels per day (b/d) in 2024
and 37.2 million b/d in 2025, both less than its pre-pandemic five-year (2015–19) average of 40.2
million b/d. These values do not include Angola, which left OPEC in January 2024.
Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024
U.S. gasoline and diesel prices are likely to fall slightly
We expect gasoline and diesel prices to fall slightly in 2024 and 2025 primarily because of
reduced refinery margins as indicated by lower crack spreads.
Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024
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We expect U.S. coal production and consumption to fall to volumes not seen since the early 1960s
Coal consumption falls because demand declines in the electric power sector, and coal production
then declines in response.
Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024
 U.S. crude oil production. Our forecast of crude oil production in the United States reaches 13.2
million barrels per day (b/d) in 2024 and more than 13.4 million b/d in 2025, both of which would
be new records. Production growth continues over the next two years driven by increases in well
efficiency. However, growth slows because of fewer active drilling rigs.
 Global liquid fuels consumption. We expect growth in global liquid fuels consumption will be lower
over the next two years: forecast consumption grows by 1.4 million b/d (1.4%), in 2024 and by 1.2
million b/d (1.2%) in 2025. Although growth in 2024 and 2025 is less than the 1.9 million b/d growth
in 2023, it is largely consistent with the 1.2% average annual growth in global liquid fuels
consumption over the 20 years from 2004–2023. We attribute the reduction in growth to slowing oil
demand growth in China due to stalling GDP growth, increasing vehicle fleet efficiency, and an end to
pandemic recovery-related growth in 2023. Despite lower oil demand growth, global consumption
of liquid fuels still reaches a new record of over 103.5 million b/d in 2025.
 Global liquid fuels production. We forecast that global liquid fuels production growth also slows.
Production rises by 0.6 million b/d in 2024, down from 1.7 million b/d of growth in 2023,
as OPEC+ continues its policy of production restraint and U.S. tight oil production growth
decelerates. In 2025, we forecast global liquid fuels production will rise by 1.6 million b/d, about
50% of which is rising OPEC+ crude oil production.
 Crude oil prices. We forecast that the Brent crude oil price will average $82 per barrel (b) in 2024,
about the same as in 2023, and then fall to $79/b in 2025, when we expect production growth will
slightly outpace demand growth, allowing inventories to build modestly and place some downward
pressure on crude oil prices. Recent developments in the Middle East increase the risk for supply
disruptions over the forecast, which could result in higher and more volatile prices we currently
forecast. One of this month’s Between the Lines articles takes a closer look at our 2024 and 2025 Brent
crude oil price forecast.
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NewBase Energy News 15-January - Issue No. 1690 call on +971504822502, UAE
The Editor:” Khaled Al Awadi” Your partner in Energy Services
NewBase energy news is produced Twice a week and sponsored by Hawk Energy Service – Dubai, UAE.
For additional free subscriptions, please email us.
About: Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
www.linkedin.com/in/khaled-al-awadi-38b995b
Mobile: +971504822502
khdmohd@hawkenergy.net or khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with over 30 years of experience in the Oil & Gas
sector. Has Mechanical Engineering BSc. & MSc. Degrees from leading U.S.
Universities. Currently working as self leading external Energy consultant for the
GCC area via many leading Energy Services companies. Khaled is the Founder of
the NewBase Energy news articles issues, Khaled is an international consultant,
advisor, ecopreneur and journalist with expertise in Gas & Oil pipeline Networks,
waste management, waste-to-energy, renewable energy, environment protection
and sustainable development. His geographical areas of focus include Middle East,
Africa and Asia. Khaled has successfully accomplished a wide range of projects in
the areas of Gas & Oil with extensive works on Gas Pipeline Network Facilities & gas
compressor stations. Executed projects in the designing & constructing of gas pipelines, gas metering &
regulating stations and in the engineering of gas/oil supply routes.
Has drafted & finalized many contracts/agreements in products sale, transportation, operation &
maintenance agreements. Along with many MOUs & JVs for organizations & governments authorities.
Currently dealing for biomass energy, biogas, waste-to-energy, recycling and waste management. He has
participated in numerous conferences and workshops as chairman, session chair, keynote speaker and
panelist.
Khaled is the Editor-in-Chief of NewBase Energy News and is a professional environmental writer with over
1400 popular articles to his credit. He is proactively engaged in creating mass awareness on renewable
energy, waste management, plant Automation IA and environmental sustainability in different parts of the
world. Khaled has become a reference for many of the Oil & Gas Conferences and for many Energy program
broadcasted internationally, via GCC leading satellite Channels. Khaled can be reached at any time, see
contact details above.
Copyright © 2024 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 endeavors have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 18
Copyright © 2024 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 endeavors have been used to ensure the accuracy of the information contained in this
publication. However, no warranty is given to the accuracy of its content. Page 19

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NewBase 15 January 2024 Energy News issue - 1690 by Khaled Al Awadi_compressed.pdf

  • 1. Copyright © 2024 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 endeavors 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 15 January 2024 No. 1690 Senior Editor Eng. Khaled Al Awadi NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE Where are energy ties between the UAE and India headed? The National - John Benny + NewBase The latest renewable energy agreement between the UAE and India will further increase co- operation between the two countries in areas such as clean energy, electricity grid connectivity and green hydrogen, experts and officials have said. Earlier this week, both countries signed initial agreements to expand bilateral investments in renewable energy, food processing and healthcare sectors. The agreement aims to invest in renewable energy projects i n India, pote ntially reaching a total capacity of 60 gigawatts. India’s Foreign Secretary Vinay Kwatra said one of the pacts was on renewable energy, which also includes green hydrogen and solar. “There is an inherent thought of possible grid connectivity between India and the UAE in that space,” Mr Kwatra told reporters at a summit in India’s Gujarat state. The preliminary agreement between the two countries would focus on combining new areas of technology with renewable energy, Navdeep Suri, former ambassador of India to the UAE, said. ww.linkedin.com/in/khaled-al-awadi-80201019/
  • 2. Copyright © 2024 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 endeavors 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 “There are some really ambitious ideas that are being discussed, particularly in terms of trying to connect grids in the two countries [and] there’s a fair bit of discussion on green hydrogen,” Mr Suri told The National. He also said the latest round of agreements could support the goals of the India-Middle East-Europe Economic Corridor and the I2U2 economic co-operation grouping. The I2U2 group is a grouping of India, Israel, the UAE and the US. The trade corridor, which was announced at the G20 Summit in India in September, will originate in India, connect the UAE, Saudi Arabia, Jordan, and Israel, and terminate in the EU. It has called for the development of a mix of rail and sea links for physical connectivity and includes plans for pipelines to transport hydrogen produced in Saudi Arabia and the UAE. I2U2 was formed in 2021 following the Abraham Accords between Israel and the UAE, to deal with issues concerning maritime security, infrastructure and transport in the region. Less than a year after the group’s creation, the countries announced a partnership to advance a 300-megawatt wind-solar hybrid project complemented by a battery energy storage system in Gujarat. At the Cop28 climate conference last month, the UAE said it would develop 6.6 gigawatts of clean energy capacity in India, including the construction of 1,200 megawatts of wind and solar projects. The projects are expected to be financed using the Emirates’ $30 billion climate fund Alterra, which is backed by major institutional investors such as BlackRock, Brookfield and TPG. "It is a great sign to see both countries furthering their co-operation on the implementation front as well,” said Gauri Singh, deputy director general at the International Renewable Energy Agency.
  • 3. Copyright © 2024 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 endeavors 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 “India possesses an incredibly attractive renewable energy market, thanks to its well-defined policies and clearly outlined targets, while the UAE continues to demonstrate its commitment to becoming a renewable energy leader,” Ms Singh told The National. Attractive market India, the world’s fifth-largest economy, aims to achieve net-zero emissions by 2070 and meet 50 per cent of its electricity requirements from renewable energy sources by the end of this decade. The Indian government has estimated that the country’s shift to a low-carbon path will require more than $10 trillion of new investments by 2070. “Given its economic growth, demographics [and] size, [India] offers probably the best return on investment,” Mr Suri said. “When you look at the trajectories of the major countries in the region … India is outperforming most of the others at this point of time and is projected to continue to outperform for the next several years,” he added. New Delhi has forecast annual gross domestic product growth of 7.3 per cent in the fiscal year ending in March, the highest rate among the major economies, despite a global slowdown. Even with the economic momentum, the country’s renewables ambitions are challenging. India, the fourth-largest country in terms of installed renewable energy capacity, will need 40 gigawatts of wind and solar capacity to be added annually to reach its 450-gigawatt target by 2030, according to Wood Mackenzie. That would require an annual investment of $35 billion a year, the US-based consultancy said in a report last year. India’s power ministry has projected renewable energy investments of about $16.5 billion for this year.
  • 4. Copyright © 2024 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 endeavors 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 "With solar and wind at grid parity, these technologies will scale up and constitute 80 per cent of the new capacity additions in India, with demand coming from not only electric utilities, but also from [the] industrial sector," Ankita Chauhan, associate director at S&P Global Commodity Insights, told The National. The signing of the initial agreement is in line with the past relationship between the two countries, where the UAE's sovereign wealth fund, the Abu Dhabi Investment Authority (Adia), has invested in several renewable energy assets and holds stakes in leading renewable companies in India, Ms Chauhan said. Adia has invested in two of India's largest renewable energy companies – ReNew and Greeenko Group. However, coal, which accounted for nearly 75 per cent of India’s electricity in 2022, will continue to play a significant role in the country’s energy mix as power demand soars. India added an annual average of five gigawatts of coal-based electricity generation capacity from 2017 to 2022. Connected power grids India and the UAE have been in talks to connect their grids through undersea cables, according to media reports. New Delhi has already signed an initial agreement with Saudi Arabia to co-operate in the areas of electrical grid interconnection, clean hydrogen and supply chains. Both countries will set up a general framework for co-operation in electrical interconnection and electricity exchange during peak times and emergencies. When it comes to connecting the power grids of India and the UAE, “you just have to negotiate a relatively small stretch of the Arabian Sea”, Mr Suri said. For the Emirates, that is more technologically and financially feasible than a grid connected with China or other emerging economies, he added. Integrating regional power systems boosts energy security, expands access to clean, affordable electricity, and allows diverse generation capacities to meet demand and maintain stability. “If you can connect grids efficiently, then you don't need to invest that [much] in [energy] storage,” Mr Suri said. “You can get over the hump of having plenty of power during the day but not enough at night,” he said. The UAE, Opec's third-largest producer, has been investing heavily in clean energy projects, ranging from nuclear to solar, to achieve net-zero emissions by 2050. The growing number of renewable energy projects also presented a favourable environment for project financing, sustainable bonds, and other investment tools that promote environmental, social and governance (ESG) principles, Vikas Lakhwani, chief revenue officer at CPT Markets, said. “The financial implications [of the UAE-India agreement] are far-reaching, creating exciting opportunities for investors, developers, and financial institutions across the spectrum,” he said.
  • 5. Copyright © 2024 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 endeavors 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 Saudia: Deals worth $7bn signed on 1st day of FMF24 in Riyadh OGN/TradeArabia News Service The first day of the third edition of Future Minerals Forum (FMF) saw the signing of 20 agreements and memorandums of understanding worth a total of SAR27 billion riyals ($7 billion) between government agencies, companies and other organizations participating in the Forum. These included agreements connected with mining exploration, technology and communications, as well as the application of sustainability standards, localization, qualification and industrialization in the minerals sector. Also, unveiled at the Forum, taking place in Riyadh's King Abdulaziz International Conference Center, were details of the 33 sites available for exploration this year, and the first mining belt to be made available for exploration in the region at Jabal Sayid, an area of 4,000 square kilometers. The signing ceremony was attended by the Minister of Industry and Mineral Resources, Bandar AlKhorayef the Minister of Investment, Khalid Al-Falih, the Minister of Transport and Logistics Services, Saleh Al-Jasser, the Vice-Minister of Industry and Mineral Resources for Mining Affairs Khalid Al-Mudaifer, and Sulaiman Al-Mazrou, CEO of the National Industrial Development and Logistics Services Program. Among the government agencies and private sector participating in signing these agreements and memorandums of understanding were Saudi Arabia’s Ministry of Industry and Mineral Resources, the Ministry of Investment, the Royal Commission for Jubail and Yanbu, the Saudi Geological Survey, the Saudi EXIM Bank, and the Saudi Mining Polytechnic (SMP). Among those signing the agreements were the Saudi Mining Services Company, Moxico Ajlan & Bros Mining, Aramco, Al-Haytham Mining Company, Manara Minerals, Vale, the Geological Survey of Finland, Maaden, Japan Organization for Metals and Energy Security, SABIC, the Export-Import Bank of the United States, Energy & Water Academy, and the Al Fada Anode Production Company. The third edition of FMF began this morning (10 January) at the King Abdulaziz International Conference Center (KAICC) with more than 16,000 participants from 145 countries in attendance, as well as 250 speakers. Over the course of two days, the Forum will address some of the most pressing issues for the minerals sector. --
  • 6. Copyright © 2024 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 endeavors 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 China’s Drive for Record Coal Output Spurs Yet Another Deadly Accident Bloomberg News The human toll of ever-increasing coal production in China is once again to the fore after thirteen were killed in a mine accident just days after the government said it will start a three-year campaign to ensure safety. Three people are still missing after a gas outburst at a mine run by a unit of Pingdingshan Tianan Coal Mining Co. in the central province of Henan on Friday, according to a release from the company on Sunday. Managers at the mine were taken into police custody and the authorities have ordered other operations in the area to halt production for safety checks, the local government said in another statement. China’s coal output continues to set records as Beijing has moved to ensure that seasonal peaks in demand are covered and blackouts avoided after the economy-crippling outages of recent years. That’s kept supplies ample and prices low, but success has come at a cost. Miners have been unable to raise production without incurring accidents, and the latest incident is likely to curtail output in the first few months of this year. The Henan disaster continues a horrible run that’s included 23 deaths at two mines in Heilongjiang in the last two months. Another 26 died at a fire in a miner’s building in Shanxi province in November, while a fire at a mine in Guizhou killed 16 in September. In February, a landslide at an open-pit mine in Inner Mongolia left 53 dead, the nation’s deadliest industrial disaster since 2019. More miners are expected to opt for slower production heading into the Lunar New Year after the incident, Cinda Securities Co. said in a note. The output cuts will mainly affect metallurgical coal used by the steel industry, it said, although rising temperatures and the seasonal lull in steel production should limit the impact on coal prices broadly.
  • 7. Copyright © 2024 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 endeavors 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 Pingdingshan Tianan is the listed arm of China Pingmei Shenma Holding Group, the biggest met coal supplier in central China, according to a report by the Securities Times. The firm invested 7 billion yuan ($976 million) in improving safety controls after being fined 240 million yuan for violations over the past three years, the report said. Pingdingshan fell as much as 5.5% in Shanghai, while coking coal futures in Dalian rose as much as 1.8%. The Pingdingshan mine has an annual capacity of 1.5 million tons, according to Morgan Stanley analyst Sarah Chan. Together with the incidents in Shanxi and Heilongjiang, the bank expects further restrictions on output nationwide and “safety inspections to remain a key focus in coal- producing regions through March at least.” Morgan Stanley said 12 million tons of capacity has been taken offline in Shanxi, the top coal producing province, since November. It said steady demand from the steel industry should support met coal prices in the first half of the year. “Coupled with elevated steel output, we see near-term upside to China met coal prices given the tight inventory level in the supply chain,” the bank said in a note on Sunday.
  • 8. Copyright © 2024 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 endeavors 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 NewBase January 15 -2024 Khaled Al Awadi NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE Oil edges up as investors eye Mideast developments Reuters + NewBase Oil prices edged up on Monday as traders watched for supply disruption risks in the Middle East following strikes by U.S. and British forces to stop Houthi militia in Yemen from attacking ships in the Red Sea. Brent crude futures were up 24 cents, or 0.3%, to $78.53 a barrel by 0825 GMT after settling 1.1% higher on Friday. U.S. West Texas Intermediate crude was at $72.83 a barrel, up 15 cents, or 0.2%, following a near 1% gain in the previous session. The benchmarks jumped more than 2% last week to touch their highest intraday levels this year after U.S. and British forces launched dozens of air strikes against Houthi forces in retaliation for months of attacks on Red Sea shipping that the Iran-backed fighters cast as a response to war in Gaza. "There are supply risks for the market given the escalation in (the) Red Sea," said Warren Patterson, head of commodities research at ING. "However, for now we are not seeing any impact on oil supply. And I guess we would need to see significant escalation before that happens." Oil price special coverage
  • 9. Copyright © 2024 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 endeavors 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 On Sunday, the Houthi militia threatened a "strong and effective response" after the United States carried out another strike overnight, ratcheting up tension. The U.S. later said it shot down a missile fired at one of its ships from Houthi militant areas of Yemen. President Joe Biden said the United States had sent a private message to Iran about the Houthi attacks. Several tanker owners steered clear of the Red Sea and multiple tankers changed course on Friday following the strikes, although traders were still watching out for Iran's response and impact on shipments in the Strait of Hormuz, the world's most important oil chokepoint. "As the Middle East conflict is currently not affecting oil production, the geopolitical risk premium priced in oil prices now appears modest based on the implied volatility of options," Goldman Sachs analysts said in a note. "While unlikely to materialise in our view, we estimate that oil prices would rise 20% in the first month of a Strait of Hormuz interruption, and may temporarily double in a less likely extended disruption." In Libya, people protesting against perceived corruption threatened to shut down two more oil and gas facilities after shutting the 300,000 barrel-per-day Sharara field on Jan. 7. In the U.S., power and natural gas companies were preparing for extreme cold over the Martin Luther King Day holiday weekend that was expected to cause record gas demand while also cutting supplies by freezing wells. The Texas power grid operator on Sunday issued an appeal to the public calling for energy conservation. Oil edged higher as the risk that airstrikes by the US and allies against the Houthis would ignite a wider conflict and disrupt crude flows from the Middle East was balanced by soft fundamentals. Brent crude rose toward $79 a barrel and West Texas Intermediate was near $73 after the US followed up the initial strikes against targets in Yemen with a fresh attack on a radar installation. While the global benchmark was up more than 4% at one point on Friday, it ended the session with a relatively modest gain of 1.1%.
  • 10. Copyright © 2024 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 endeavors 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 Global oil markets have been transfixed by the situation in the Middle East since the Hamas attack on Israel on Oct. 7. The strikes on the Houthis were in retaliation for the group’s harrying of ships in the Red Sea over the last couple of months. The Iran-backed militants have vowed not to let up until Israel ends its assault in the Gaza Strip. The price reaction suggests the market doesn’t, at this point, see a high chance that the evolving conflict will spread and endanger crude production and flows from the wider Middle East, which accounts for around a third of the world’s oil. Instead, the prospect of rising supply from non-OPEC countries and slowing demand growth looks to be taking precedence. “For now, developments in the region are not having an impact on oil supply,” said Warren Patterson, head of commodities strategy for ING Groep NV. “And in the absence of supply disruptions, the oil market remains comfortable over the first half of the year, despite heightened tensions.” The setup for crude appears tough this year. While demand is still growing, it’s expected to do so at a markedly slower pace as the post-pandemic rebound dissipates. There are also question marks around whether production cuts announced by the Organization of the Petroleum Exporting Countries and allies will be enough to offset an impending surplus. Still, the increased tensions in the Middle East are disrupting crude flows to a certain extent. At least three oil tanker owners, which between them marshal more than 350 vessels, said Friday they were pausing voyages through the southern Red Sea. More are likely to follow suit after advice from Western military forces that all ships should stay away from the area. A vessel hauling Russian oil had a narrow miss with a missile fired from Yemen, according to the UK navy. A Houthi-operated TV channel also said fighter jets had hit targets in a new strike on Sunday evening, although there was no immediate confirmation from the US or UK militaries. “As the Middle East conflict is currently not affecting oil production, the geopolitical risk premium priced in oil prices now appears modest,” Goldman Sachs Group Inc. said in a note. Prices are likely to be range-bound as high spare capacity caps the upside, while low recession risk and responsive OPEC+ supply limit the downside, they said.
  • 11. Copyright © 2024 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 endeavors 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 EIA expect Henry Hub natural gas spot price to average under $3.00/MMBtu in 2024 and 2025 …. Source EIA Eia expect the U.S. benchmark natural gas spot price at the Henry Hub to average under $3.00 per million British thermal units (MMBtu) in 2024 and 2025 in our January Short-Term Energy Outlook (STEO). The annual average Henry Hub prices in 2024 and 2025 increase from 2023 in our forecast because we expect natural gas demand growth to outpace natural gas supply growth. Despite increased demand, our forecast prices for 2024 and 2025 are less than half the annual average price in 2022 and are only slightly higher than the $2.54/MMBtu we reported for 2023. After averaging just under $6.50/MMBtu in 2022, the Henry Hub price declined to $3.27/MMBtu in January 2023, driven by warmer-than-average weather and reduced natural gas consumption in most of the United States. The Henry Hub price remained relatively low for all of 2023 because of strong natural gas production and more natural gas in storage. EIA expect these drivers of low prices to continue over the next two years, as U.S. natural gas production remains relatively flat but grows enough to set new record highs. In our January STEO, U.S. dry natural gas production increases 1.5 billion cubic feet per day (Bcf/d) in 2024 from record highs in 2023 to average 105.0 Bcf/d. forecast dry natural gas production increases again in 2025 by 1.3 Bcf/d to average 106.4 Bcf/d. Working natural gas inventories were above the previous five-year (2018–22) average for all of
  • 12. Copyright © 2024 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 endeavors 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 2023, and we expect inventories will remain above the five-year average in 2024 and 2025 because of continued increases in natural gas production. Note: In the annual total for 2023, November and December are STEO estimates. Supply is dry natural gas production and imports. Demand is total natural gas consumption and exports. EIA also expect U.S. demand for natural gas—total natural gas consumption plus natural gas exports—to increase in 2024 and 2025, driven by growth in liquefied natural gas (LNG) exports, which EIA forecast to increase by 4% (0.5 Bcf/d) in 2024 and 17% (2.1 Bcf/d) in 2025. Consumption of natural gas in 2024 increases in the residential sector by 4% (0.5 Bcf/d) and in the commercial sector by 3% (0.3 Bcf/d) because EIA expect colder winter weather than in 2023. Last year started and ended with warmer-than-average temperatures. In EIA forecast, U.S. consumption of natural gas in the electric power sector also increases modestly in 2024 by 1%. These increases in consumption are partially offset by less consumption in the industrial sector. U.S. consumption of natural gas in EIA forecast during 2025 is flat relative to 2024 levels in all sectors except for the electric power sector where we expect consumption to decrease by 0.2 Bcf/d. In 2024, EIA expect U.S natural gas demand to increase more than supply—dry natural gas production plus natural gas imports—pushing up the average annual price in 2024 slightly. However, we expect prices to stay relatively low in 2024 because of strong natural gas storage inventories. EIA expect demand growth will exceed supply growth again in 2025, driven by more LNG exports, putting upward pressure on prices in 2025.
  • 13. Copyright © 2024 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 endeavors 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 NewBase Specual Coverage The Energy world –January 15 -2024 CLEAN ENERGY We expect solar will supply almost all growth in U.S. electricity generation through 2025 .. U.S. EIA, Short-Term Energy Outlook, January 2024 We expect solar electric generation will be the leading source of growth in the U.S. electric power sector. In our January Short-Term Energy Outlook (STEO), which contains new forecast data through December 2025, we forecast new capacity will boost the solar share of total generation to 5.6% in 2024 and 7.0% in 2025, up from 4.0% in 2023. Note: Values for 2023 reflect historical data through October and estimates for November and December. The STEO includes two Between the Lines articles that discuss how our forecast for Brent crude oil prices performed in 2023 and a closer look at our Brent price forecast for 2024 and 2025. We expect U.S. crude oil and natural gas production growth to slow, but both continue to reach new records. Other key takeaways from our January 2024 STEO include the following. We believe that slower growth will still establish new annual records in U.S. crude oil and natural gas production
  • 14. Copyright © 2024 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 endeavors 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 Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024 Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024
  • 15. Copyright © 2024 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 endeavors 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 OPEC+ production will probably stay below targets We forecast OPEC+’s crude oil production will average 36.4 million barrels per day (b/d) in 2024 and 37.2 million b/d in 2025, both less than its pre-pandemic five-year (2015–19) average of 40.2 million b/d. These values do not include Angola, which left OPEC in January 2024. Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024 U.S. gasoline and diesel prices are likely to fall slightly We expect gasoline and diesel prices to fall slightly in 2024 and 2025 primarily because of reduced refinery margins as indicated by lower crack spreads. Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024
  • 16. Copyright © 2024 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 endeavors 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 We expect U.S. coal production and consumption to fall to volumes not seen since the early 1960s Coal consumption falls because demand declines in the electric power sector, and coal production then declines in response. Data source: U.S. Energy Information Administration, Short-Term Energy Outlook, January 2024  U.S. crude oil production. Our forecast of crude oil production in the United States reaches 13.2 million barrels per day (b/d) in 2024 and more than 13.4 million b/d in 2025, both of which would be new records. Production growth continues over the next two years driven by increases in well efficiency. However, growth slows because of fewer active drilling rigs.  Global liquid fuels consumption. We expect growth in global liquid fuels consumption will be lower over the next two years: forecast consumption grows by 1.4 million b/d (1.4%), in 2024 and by 1.2 million b/d (1.2%) in 2025. Although growth in 2024 and 2025 is less than the 1.9 million b/d growth in 2023, it is largely consistent with the 1.2% average annual growth in global liquid fuels consumption over the 20 years from 2004–2023. We attribute the reduction in growth to slowing oil demand growth in China due to stalling GDP growth, increasing vehicle fleet efficiency, and an end to pandemic recovery-related growth in 2023. Despite lower oil demand growth, global consumption of liquid fuels still reaches a new record of over 103.5 million b/d in 2025.  Global liquid fuels production. We forecast that global liquid fuels production growth also slows. Production rises by 0.6 million b/d in 2024, down from 1.7 million b/d of growth in 2023, as OPEC+ continues its policy of production restraint and U.S. tight oil production growth decelerates. In 2025, we forecast global liquid fuels production will rise by 1.6 million b/d, about 50% of which is rising OPEC+ crude oil production.  Crude oil prices. We forecast that the Brent crude oil price will average $82 per barrel (b) in 2024, about the same as in 2023, and then fall to $79/b in 2025, when we expect production growth will slightly outpace demand growth, allowing inventories to build modestly and place some downward pressure on crude oil prices. Recent developments in the Middle East increase the risk for supply disruptions over the forecast, which could result in higher and more volatile prices we currently forecast. One of this month’s Between the Lines articles takes a closer look at our 2024 and 2025 Brent crude oil price forecast.
  • 17. Copyright © 2024 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 endeavors 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 NewBase Energy News 15-January - Issue No. 1690 call on +971504822502, UAE The Editor:” Khaled Al Awadi” Your partner in Energy Services NewBase energy news is produced Twice a week and sponsored by Hawk Energy Service – Dubai, UAE. For additional free subscriptions, please email us. About: Khaled Malallah Al Awadi, Energy Consultant MS & BS Mechanical Engineering (HON), USA Emarat member since 1990 ASME member since 1995 Hawk Energy member 2010 www.linkedin.com/in/khaled-al-awadi-38b995b Mobile: +971504822502 khdmohd@hawkenergy.net or khdmohd@hotmail.com Khaled Al Awadi is a UAE National with over 30 years of experience in the Oil & Gas sector. Has Mechanical Engineering BSc. & MSc. Degrees from leading U.S. Universities. Currently working as self leading external Energy consultant for the GCC area via many leading Energy Services companies. Khaled is the Founder of the NewBase Energy news articles issues, Khaled is an international consultant, advisor, ecopreneur and journalist with expertise in Gas & Oil pipeline Networks, waste management, waste-to-energy, renewable energy, environment protection and sustainable development. His geographical areas of focus include Middle East, Africa and Asia. Khaled has successfully accomplished a wide range of projects in the areas of Gas & Oil with extensive works on Gas Pipeline Network Facilities & gas compressor stations. Executed projects in the designing & constructing of gas pipelines, gas metering & regulating stations and in the engineering of gas/oil supply routes. Has drafted & finalized many contracts/agreements in products sale, transportation, operation & maintenance agreements. Along with many MOUs & JVs for organizations & governments authorities. Currently dealing for biomass energy, biogas, waste-to-energy, recycling and waste management. He has participated in numerous conferences and workshops as chairman, session chair, keynote speaker and panelist. Khaled is the Editor-in-Chief of NewBase Energy News and is a professional environmental writer with over 1400 popular articles to his credit. He is proactively engaged in creating mass awareness on renewable energy, waste management, plant Automation IA and environmental sustainability in different parts of the world. Khaled has become a reference for many of the Oil & Gas Conferences and for many Energy program broadcasted internationally, via GCC leading satellite Channels. Khaled can be reached at any time, see contact details above.
  • 18. Copyright © 2024 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 endeavors have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 18
  • 19. Copyright © 2024 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 endeavors have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content. Page 19