NewBase August 05-2022 Energy News issue - 1535 by Khaled Al Awadi.pdf

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NewBase Energy News 05 August 2022 No. 1535 Senior Editor Eng. Khaed Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Algeria: Petrofac consortium awarded EPC project in Algeria
Source: Petrofac
Petrofac, leading a consortium with Genie Civil et Batiment (GCB), has received notification of a
provisional award for an engineering, procurement and construction contract with Sonatrach for
the Tinrhert EPC2 Development Project in Algeria. The contract is valued at approx. US$300
million, with Petrofac’s share around US$200 million.
Located in Alrar, around 1,500 kms southeast of Algiers, EPC2 will provide a new Central
Processing Facility (CPF) with inlet separation and decarbonisation units. The scope of work also
includes tie ins to the existing Alrar Separation and Boosting Facilities, which Petrofac originally
helped deliver in 2018, along with commissioning, start-up and performance testing.
When completed, the development will boost natural gas production and remove CO2 from the
field’s gas reserves, within specifications for the global market, enabling further economic growth
in-country.

Elie Lahoud, Chief Operating Officer for Petrofac’s Engineering & Construction division said: 'The
Petrofac and GCB consortium is testament to our focus on local delivery, through investment in
local supply chains and work forces.
We are very pleased to have been notified of this provisional award by Sonatrach, which reflects
their confidence in our ability to drive in-country value, whilst safely delivering strategically significant
energy infrastructure.'
Petrofac has decades of experience in Algeria with a strong track record of safe execution. In 2018
the Company was awarded a contract with Sonatrach for Tinrhert EPC1, which, includes delivery
of a new inlet separation and compression centre, successfully extending the existing Ohanet CPF.
This project recently achieved a major milestone with the safe introduction of the first hydrocarbons
for the start-up of production.

Egypt: United Oil and Gas provides update on AJ-14 dev. well
Source: United Oil & Gas
United Oil & Gas has announced an update on the drilling of the Al Jahraa-14 development well
('AJ-14') in the Abu Sennan licence, onshore Egypt. United holds a 22% working interest in the
licence, which is operated by Kuwait Energy Egypt.
Summary
 AJ-14 encountered seven metres of net oil pay in the Primary Abu Roash C ('ARC') reservoir
 Planned testing programme to include both Primary (ARC) and Secondary Abu Roash G
('ARG') targets
 AJ-14 is the seventh successful development well at Abu Sennan since United acquired its
interest in the licence
The AJ-14 development well was primarily drilled to intersect the ARC reservoir, targeting reserves
from an undrained area of the Al Jahraa Field identified from reservoir and simulation modelling
work. The well safely reached total depth of 3619 metres ahead of schedule and under budget.
A full logging suite was acquired through the ARC and 7 metres of good quality net oil pay has
been interpreted in the reservoir, in line with the higher end of the pre-drill estimates.
The secondary ARG target was encountered 13 metres updip of the Al Jahraa-12 well, which was
interpreted to have intersected an oil-water contact in this reservoir. Due to technical difficulties
whilst running the logging tools a full logging suite was not acquired over the ARG interval in the
AJ-14 well.

However, there was sufficient encouragement from the Logging While Drilling tools to indicate
potentially hydrocarbon-bearing reservoir, and to include the ARG in the testing programme.
Both the primary and secondary targets of the well are now planned to be tested and completed. If
the testing is successful from either target, the well will be brought immediately onstream through
the existing facilities, adding additional production and revenue for United. United will update the
market on these results in due course.
Continuing Egypt drilling programme
The Sino Tharwa-1 rig used to drill AJ-14 will now be used to drill the ASH-4 development well,
which is targeting 2.2 million barrels gross mean recoverable reserves in an undrilled compartment
of the ASH Field. The rig move is expected to be performed over the next few weeks, with the well
to spud shortly thereafter.
Brian Larkin, CEO commented:
'This is the seventh consecutive successful development well on the Abu Sennan licence since
2019. With oil prices remaining high, and the speed with which additional production can be quickly
brought on stream through existing facilities, Abu Sennan's strong cash generation and extensive
reserve and prospect inventory provides a solid foundation on which to build United's strategy.
We are very excited about the remaining wells in the 2022 drilling programme, with the ASH-4
development well targeting 2.2 million barrels gross before the drilling of the final well in our 2022
programme, the high impact exploration well ASF-1X which is targeting over 8 million barrels gross.'

The U.S. power grid added 15 GW of generating capacity in 2022
U.S. Energy Information Administration, Preliminary Monthly Electric Generator Inventory, June 2022
According to our latest inventory of electric generators, 15 gigawatts (GW) of new utility-scale
electric generating capacity came online in the United States during the first half of 2022. Based on
the most recently reported plans, developers could add another 29 GW of capacity in the second
half of the year.
Our Preliminary Monthly Electric Generator Inventory compiles information on all U.S. utility-scale
power plants (plants with a nameplate capacity of at least 1 megawatt [MW]) that are currently
operating, planning to come online, or retired. The inventory includes all utility-scale plants that have
retired since 2002.

We update this inventory once a month with preliminary data and then finalize that data annually
with a survey that provides additional information about the power plants. Our Preliminary Monthly
Electric Generator Inventory includes information through the preceding month; for example, the
inventory published in July includes information through June.
Note: Utility-scale generating units are those with at least 1 megawatt of nameplate capacity.
Operating capacity: Wind generation accounts for the largest share, 34%, of the 15.1 GW of capacity
that came online in the United States during the first half of 2022, followed by natural gas, solar,
and battery storage.
More than 40% of the wind capacity added so far in 2022 is located in Texas, 2.2 GW of the 5.2
GW wind total. The largest renewable projects that came online in the first six months of 2022
include the 999 MW Traverse Wind Project in Oklahoma, the 492 MW Maverick Creek Wind in
Texas, and the 440 MW solar and battery storage project at Slate Hybrid in California.
Planned capacity: Developers and
project planners report plans to
add 29.4 GW of new capacity in
the United States in the second
half of 2022. Nearly half of that
planned capacity is from solar
(13.6 GW), followed by wind (6.0
GW). As in previous years, many
projects plan to come online in
December because of tax
incentives.
Respondents to our survey
currently plan to add 3.7 GW less
solar capacity in 2022 than what
they had expected at
the beginning of the year.

Pandemic-related challenges in supply chains and a U.S. Department of Commerce tariff
investigation are likely causes for this decrease.
Retired capacity: Of the 15.1 GW of electric generating capacity that U.S. operators plan to retire
during 2022, more than half (8.8 GW) was retired in the first half of the year. Coal-fired power plants
will account for 76% of the retirements this year, followed by natural gas (12%) and nuclear (9%).
The largest U.S. coal power plant retirements in 2022 include the 1,305 MW William H. Zimmer
plant in Ohio, which retired in May, and the 1,205 MW Morgantown Generating Station in Maryland,
which retired in June. In addition, the 769 MW Palisades nuclear power facility in Michigan retired
in June.

NewBase August 05 -2022 Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oil prices climb, supply shortage concerns outweigh demand worries
Reuters + NewBase
Oil prices rose on Friday, bouncing off their lowest levels since February in the
previous session, as supply shortage concerns were enough to cancel out fears
of slackening fuel demand.
Brent crude rose 18 cents, or 0.2%, to $94.30 a barrel by 0930 GMT, while U.S.
West Texas Intermediate crude was up 7 cents, or 0.08%, at $88.61 a barrel.
Oil price special
coverage

Oil prices have come under pressure this week as the market fretted over the
impact of inflation on economic growth and demand, but signs of tight supply
kept a floor under prices.
"OPEC's meagre supply hike highlights the limited capacity the market has to
handle further shortages," ANZ Research analysts said.
For September, OPEC+ is set to raise its oil output goal by 100,000 barrels per
day. The hike is one of the smallest since OPEC quotas were introduced in
1982, OPEC data shows.
The global crude oil markets remained firmly in backwardation, where prompt
prices are higher than those in future months, indicating tight supplies.
Supply concerns are expected to ratchet up closer to winter with the European
Union sanctions banning seaborne imports of Russian crude and oil products
set to take effect on Dec. 5.
"With the EU halting seaborne Russian imports, there is a key question of
whether Middle Eastern producers will reroute their barrels to Europe to backfill
the void," RBC analyst Michael Tran said.
"How this Russian oil sanctions policy shakes out will be one of the most
consequential matters to watch for the remainder of the year," Tran added.
For now, signs of an economic slowdown capped price recovery. Recession
worries have intensified following the Bank of England's warning of a drawn-out
downturn after it raised interest rates by the most since 1995.

"If commodities are not pricing in an imminent economic recession, they might
be preparing for a 'stagflation' era when the unemployment rate starts picking
up and inflation stays high," CMC Markets analyst Tina Teng said.
Investors are focused on the U.S. employment report to be released later in the
day, which is expected to show nonfarm payrolls increased by 250,000 jobs last
month, after rising by 372,000 jobs in June.
Any signs of strength in the labour market could feed into fears of aggressive
steps by the U.S. Federal Reserve to curb inflation.
LNG price spike causes energy crises in strapped Asian nations
Reuters + NewBase + Bloomberg
Asian LNG buyers are competing with European purchasers reeling from Russia's move
to tighten supplies in July. Pakistan deals with power shortages and production cuts amid tenfold
jump
Prices for liquefied natural gas on the Asian spot market have surged nearly 10 times from average
summer rates, causing crippling shortages in emerging nations strapped for foreign currency.
Spot prices for LNG bound for Japan, South Korea and other major Asian economies now hover in
the upper $40 range per one million British thermal units. On Wednesday last week, the price briefly
topped $50, a high not seen since early March, right after Russia invaded Ukraine.
Because LNG demand typically peaks in winter, the spot rates are usually cheaper in the summer.
Summer spot rates averaged about $5 per million BTUs up through 2019.
Europe's sky-high natural gas prices has had a ripple effect on Asian prices. In late July, Russia
reduced pipeline gas supply to Germany by 80%, citing needed maintenance.
Dutch TTF natural gas prices, the European benchmark, briefly jumped to around $65 per million
BTUs, or 2.7 times the most recent low in June.
As a result, Asian nations that purchase LNG from the U.S. and other sources needed to
raise purchasing prices to remain competitive buyers. LNG prices in Asia reflected that shift.
Because Japan and South Korea are major consumers of LNG, the cost of generating electricity
has escalated, creating economic headwinds.
The impact has been profound for emerging nations that lack deep foreign exchange reserves.
Pakistan imported 4.25 million tonnes of LNG between January and July, according to the data firm
Kepler, down 18% from a year earlier. In addition, Pakistan gave up on bidding for 10 cargoes worth
of LNG scheduled for import between July and September due to soaring prices.
Pakistan "cannot afford" to purchase LNG at a high price given limited foreign reserves allocated
for fuels, said Pakistani Prime Minister Shehbaz Sharif during a meeting to address the energy
situation last month.
LNG imports in Bangladesh, India and other emerging nations have dipped below the previous
year's levels as well.
"With the exception of India, where coal makes up much of the power generating mix, a decrease
in gas imports will directly lead to power crises," said Yutaka Shirakawa, project director at the Japan
Oil, Gas and Metals National Corp.

Gas accounted for 46% of Pakistan's power generation in 2019, according to the International
Energy Agency, while the share for Bangladesh was 81%. Extended power outages that can last
for half a day are affecting many parts of both countries.
Gas shortages and power crunches deal significant blows to local industries. In Pakistan's textile
industry, output volume reportedly crashed by more than half last month due to diminished gas
supplies, causing at least $1 billion in losses.
Pakistan stands a very high risk of losing customers for good, according to the All Pakistan Textile
Mills Association. That may cause a vicious cycle in which Pakistan's forex reserves decrease
further, putting the country in a worse position to purchase energy.
In economic forecasts published last week by the International Monetary Fund, the projected growth
for Asian emerging economies for this year was downgraded to 4.6% from the 5.4% outlook in April.
"The energy shortage will rob countries of their source of economic strength, and the longer it
persists, the worse the negative impact on emerging economies will be," said Osamu Tanaka, chief
economist at the Dai-ichi Life Research Institute.
China, Japan and South Korea are the three largest LNG consumers in Asia. They have previously
responded to high prices by curbing demand, but lately buyers are stepping up procurement for the
winter season, according to Rim Intelligence, a Tokyo-based energy research firm.
"Korea Gas and other large buyers have made bulk purchases," said a market source. This could
further constrict access to LNG for Asian emerging economies lacking the same level of purchasing
power.
An independent watchdog in Australia on Monday recommended restricting LNG exports. It remains
to be seen if Australia will act on the recommendation, but the news has further inflamed concerns
about a global LNG shortage. There is also the risk of larger diplomatic rifts if emerging nations turn
to Russia for LNG supplies.
European Gas Falls With US LNG Plant Poised for Faster Restart
Natural gas prices in Europe headed for a second day of losses, with signs of extra supplies from
the US offsetting concerns about shipments from Russia.
Benchmark futures fell as much as 4.6% following a recent rally as traders assessed several
conflicting factors.
A major export terminal in Texas, shut earlier this year after a blast, reached an agreement with
regulators to restart in early October at almost full capacity. While the Freeport LNG facility had
already indicated that it planned to resume operations by then, traders expected a more gradual
return.
The restart of the plant should come as a relief for Europe, which desperately needs additional
supply from the US as Russia curbs fuel shipments to the continent. The region is facing a historic
energy squeeze that is rippling through the broader economy, fanning inflation.
Last week, Gazprom PJSC cut shipments on the Nord Stream pipeline to Germany to 20% of
capacity, citing issues with equipment at the link’s entry point. That sent gas futures to the highest
levels since March, during the first weeks of Russia’s war in Ukraine. Yet, the build-up of European
stockpiles, coupled with falling consumption by industry, has helped to keep prices in check in recent
days.

Dutch front-month gas contract, the European benchmark, traded 2.6% lower at 193.87 euros per
megawatt-hour by 12:53 p.m. in Amsterdam. The UK equivalent was 0.8% higher, with a number of
gas facilities in the country undergoing seasonal maintenance.
Extra gas from the US “should help ease some of the tightness in the spot market we have seen
recently, as well as put pressure potentially on Gazprom to reassess the compressor issue at Nord
Stream,” said Nick Campbell, a director at consultant Inspired Plc. Higher LNG flows should impact
prices and therefore affect Russia’s gas revenues, he said.
A standoff between Moscow and Berlin over the Nord Stream equipment has become an apparent
stalemate. The Kremlin said Thursday that Gazprom would like to get the turbine back, but the
company needs documents to show that the equipment isn’t subject to international sanctions.
“The Russian government decides what the export level is,” said Thierry Bros, a professor at the
Paris Institute of Political Studies. “The rest is just a show for prime time TV.”
Separately, Uniper SE warned it may have to cut output at two key coal-fired power plants in
Germany as fuel supplies are limited because of low water levels of the Rhine river. Hotter river
temperatures are also affecting nuclear plants in France.

NewBase Specual Coverage
The Energy world –August -05 -2022
CLEAN ENERGY
European gas storage on track to meet target but at a cost
Reuters + NewBase
European countries are on track to reach a gas storage filling target by the start of this winter, but
the cost of replenishing stocks will be over 50 billion euros ($51 billion), 10 times more than the
historical average of filling up tanks for winter.
European governments had been concerned that Russia's cut in supplies through its main gas
pipeline to Germany would leave countries unable to meet goals to refill storage for winter.
They have managed to build up gas storage steadily by curbing demand, switching from gas to coal
for some power plants and increasing imports of liquefied natural gas (LNG).
European gas storage levels were 70.54% full on Tuesday, surpassing the 5-year average of
70.32%, according to data from Gas Infrastructure Europe (GIE) released on Thursday. The levels
were also not far from a 10-year average of around 71.40%.
The European Union aims to refill storage to 80% of capacity by Nov. 1 to provide a buffer for peak
demand winter months. The EU has also set interim targets for each country for each month.
Germany, hardest-hit by Russia's reduced gas flows, has set a higher goal for itself and aims to be
95% full by November.
 Europe gas storage 70% full, surpassing 5-year average
 Filling EU tanks to targets costs 50-55 bln euros-analysts
 Europe raised LNG imports to compensate for reduced Russia flows
 Despite building up gas storage, uncertainties remain

"The EU already surpassed its September 1 interim filling target in early July and is still on pace to
reach the November 1 target," said Jacob Mandel, senior associate for commodities at Aurora
Energy Research.
Ramped-up LNG imports have helped. The EU imported 21.36 million tonnes of LNG in the first half
of 2022, up from 8.21 million tonnes in the same period a year ago, according to ICIS.
In June, for the first time in history, U.S. LNG contributed more gas supply to Europe than pipeline
gas from Russia.
However, despite being on track to meet the target, analysts cautioned against complacency and
warned that Europe's dependence on Russian gas is far from over.
"Europe remains dependent on two things: how cold the winter will be and how Russian flows will
evolve into spring. Uncertainty on both will likely keep prices supported even if inventories keep
rising over the coming months," UBS oil analyst Giovanni Staunovo said.
Analysts and industrial experts have warned filling up gas storage to target levels would be
impossible if Russia totally cuts supplies through the Nord Stream 1 pipeline to Germany. read more

HIGH PRICES
Private firms are primarily responsible for storage injections. European governments have offered
incentives such as credit lines, loans and subsidies to help them buy gas as prices hit record
highs. read more
The price of the front-month Dutch TTF gas contract , the benchmark for Europe, has almost tripled
since the start of the year due to the slowdown of Russian gas deliveries through Nord Stream 1
and a tight global market. read more
This makes buying wholesale gas a costly enterprise.
"Hypothetically, replacing the North Stream 1 flow over this winter based on the TTF future price for
the winter season, would cost Europe over 50 billion euros, about 10 times higher than it would
have been historically," said Callum Macpherson, head of commodities at Investec.
Simone Tagliapietra, senior fellow at think-
tank Bruegel estimates that Europe would
have to spend 26 billion euros to fill up gas
storage to 80% from current levels.

Europe's natural gas imports from Russia
Aurora's Mandel estimated the total cost of gas injected into EU storage since the introduction of
the targets in June is about 19.8 billion euros, assuming that all gas injected into storage has been
and will be purchased at spot prices at the Dutch TTF hub.
He expected an extra 35.5 billion euros is now needed to fill EU storage to the targets, bringing the
total to over 55 billion euros.
"I would also estimate an additional 300 million to 600 million euros for the cost of using the storage,"
he said.
The cost of filling up the storage could be passed to consumers by ever higher energy bills or
through taxation, analysts said.
The European Commission, the EU executive, proposed last month a target for all member states
to cut gas use by 15% from Aug. 1 to allow storage to fill more quickly. read more
EU gas inventories were around 78.81 billion cubic metres (bcm), UBS said, still 25 bcm below the
level the bank estimates would allow the EU to ride out a complete cut-off of Russian supplies
without significant demand-rationing.

Map showing how gas and oil-rich Russia is linked to European energy markets through a series of
critical pipelines, the biggest flowing through Ukraine.

NewBase Energy News 05 August 2022 - Issue No. 1534 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.
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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.

NewBase August 05-2022 Energy News issue - 1535 by Khaled Al Awadi.pdf

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NewBase August 05-2022 Energy News issue - 1535 by Khaled Al Awadi.pdf