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Energy security


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Energy security

  1. 1. ENERGY SECURITY<br />
  2. 2. UK Energy Mix<br />Domestic production meets demand not dependent on imports hence not vulnerable to geopolitical forces <br />
  3. 3. Germany<br />Dependency on imported oil & gas hence developing nuclear & renewables energy industry, vulnerable to geopolitical forces hence developing energy storage <br />
  4. 4. France<br />Totally dependent on imports for energy hence developed nuclear energy and huge storage to withstand supply disruptions <br />
  5. 5. China<br />Dependency on oil imports hence building nuclear , renewable energy industry also developed storage to withstand disruptive geopolitical forces <br />
  6. 6. INDIA <br />Highly dependent on oil imports ,unavailability of quality coal hence imports of coal also increasing ,carbon emissions ,needs to develop nuclear , renewables industry and storage to withstand geopolitical forces .<br />
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  8. 8. 89.07<br />
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  11. 11. Oil Supply Disruptions <br /> World’s oil supply is vulnerable to geopolitical forces . Vulnerabilities are most prevalent in the world’s six major oil transit chokepoints—where the threat of terrorist attack, theft from pirates, political unrest, and shipping accidents post real dangers. More than 40 billion barrels of oil are shipped every day along these narrow channels. A single incident in one of these locations could immediately wake up world consumers to the supply disruptions and price fluctuations .<br />
  12. 12. Theft by Pirates<br />Threat of Terrorist Attacks<br />Geopolitical Blocks /Alignment <br />Disruptions World Oil Supplies<br />Shipping Accidents<br />Political Unrest<br />Cartel Formation by Companies<br />Wars<br />Price Shocks<br />
  13. 13. Strait of Hormuz<br />The Strait of Hormuz is by far the world’s most important chokepoint with an oil flow of 16 to 17 million barrels per day—roughly 20 percent of oil traded worldwide. At its narrowest point the Strait is 21 miles wide, and the shipping lanes consist of two-mile-wide channels. The majority of oil exported through the Strait of Hormuz travels to Asia, the United States and Western Europe. On average, 15 crude oil tankers pass through the Strait of Hormuz every day.<br />
  14. 14. The Persian Gulf has Iran , Iraq, Kuwait , Saudi Arab , Qatar , Oman , United Arab Emirates etc all rich in oil & gas from where 40 % of world supplies are made. India imports 70 % crude from this region . <br />
  15. 15. The Panama Canal<br />The Panama Canal is an important route connecting the Pacific Ocean with the Caribbean Sea and Atlantic Ocean. A half-million barrels per day of crude and petroleum products were transported through the canal in 2006. The Canal is 50 miles long, and only 110 feet wide at its narrowest point, called the Culebra Cut. The Panama Canal is not a significant route for US petroleum imports, but like all important thoroughfares, closure of the Panama Canal would greatly increase transit times and costs adding over 8,000 miles of travel.<br />
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  17. 17. The Turkish Straits<br />The Bosporus Strait is one of the busiest and most dangerous chokepoints in the world. The 17-mile long waterway located in Turkey supplies Western and Southern Europe with oil from the Caspian Sea Region. In 2006, an estimated 2.4 million barrels per day of mostly crude oil flowed southbound through this passageway. Only half a mile wide at its narrowest point, the Turkish Strait is one of the world's most difficult waterways to navigate due to its sinuous geography. With 50,000 vessels, including 5,500 oil tankers, passing through the straits annually it is also one of the world’s busiest oil routes .<br />
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  20. 20. The Strait of Bab el-Mandab<br />The Strait of Bab el-Mandab is a chokepoint between the horn of Africa and the Middle East, and a strategic link between the Mediterranean Sea and Indian Ocean. It is located between Yemen, Djibouti, and Eritrea, and connects the Red Sea with the Gulf of Aden and the Arabian Sea. In 2006, an estimated 3.3 million barrels per day flowed through this waterway toward Europe, the United States, and Asia. The Strait is 18 miles wide at its narrowest point, with two 2-mile-wide channels for inbound and outbound shipments. Bab el-Mandeb was the site for of a naval blockade of Israel by Egypt in the 1973 Yom Kippur War.<br />
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  22. 22. The Strait of Malacca<br />The Strait of Malacca, linking the Indian and Pacific Oceans, is the shortest sea route between the Middle East and growing Asian markets. At its narrowest point, Malacca is only 1.7 miles wide, creating a natural bottleneck—as well as potential for collisions, grounding, or oil spills. Recent reports by the International Chamber of Commerce show that piracy, including attempted theft and hijackings, is a constant threat to tankers in the Strait of Malacca.<br />
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  24. 24. The Suez Canal<br />The Suez Canal is located in Egypt, and connects the Red Sea and Gulf of Suez with the Mediterranean Sea. Oil shipments from the Persian Gulf travel through the Canal primarily to European ports, but also to the United States. More than 3,000 oil tankers pass through the Suez Canal annually. Rampant piracy off Somalia's coast has recently hit revenues at the Suez Canal. Shippers are avoiding the canal following the capture by Somali pirates of a Saudi Arabian supertanker loaded with $100 million worth of oil in November 2008.<br />
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  26. 26. AL-QAEDA TERRORIST GROUP: GLOBAL CELLS(The following image show the global map of Al-Qaeda cells.)  <br />
  27. 27. AL-QAEDA TERRORIST GROUP: GLOBAL CELLS(The following image show the global map of Al-Qaeda cells.)  <br />Sea Lanes of Oil Tankers to India<br />
  28. 28. Terrorist cells are present at the critical water passes <br />1) Malacca Strait – Oil from Russian far east <br />2)Strait of Hormuz – Oil from Iran /Iraq/Kuwait/Saudi Arab / Qatar/ United Arab Emirates<br />3)Suez Canal – Russian Caspian sea /Saudi /North Africa <br />4)Strait of Bab el Mandab –Saudi and suez canal <br />
  29. 29. The Suez Canal Blocked during the war for control over It between Egypt , Britain , France and Israel <br />
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  32. 32. Blockade of Karachi by Indian Navy during 1971 war with Pakistan <br />
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  35. 35. Reliance refinery I & II - 30 +30 = 60 MMT Jamnagar<br />Essar refinery - 20-30 MMT Jamnagar<br />Koyali refinery -20 MMT - Hazira<br />BPCL + HPCL Refineries – 20 MMT Mumbai <br />Pipelines originating for three refineries Mathura , Panipat , Bhatinda, Bina , Allahabad <br />Product Pipelines – KandlaBhatinda,<br />
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  37. 37. Price Shocks <br />
  38. 38. Supply Curtailment <br />In 1971, the oil-producing countries of the Arab world tried to shift the balance of power between themselves and Western oil companies and consumers. Libya -- negotiating on behalf of itself and Algeria, Iraq, and Saudi Arabia -- declared that they, and not foreign companies, would set the price of oil flowing into Europe. As a result, prices to Europe, the main market at the time for traded oil, increased by 35 percent overnight. At the same time, members of the Organization of Petroleum Exporting Countries (OPEC) raised taxes on oil companies from 50 percent or less to as much as 80 percent. Also in 1971, Libya nationalized BP's oil concession in the country, and Algeria nationalized 51 percent of the French company CFP's operations.That same year, the United States pulled out of the Bretton Woods system and moved away from the gold standard, effectively devaluing the dollar; OPEC, whose oil receipts are denominated in dollars, compensated by raising prices. Meanwhile, Libya began to use what Muammar al-Qaddafi, who had taken power in 1969, called his country's "oil weapon" against the West. The nation reduced its output from 3.35 million barrels a day in 1970 to 2.25 million by 1972, dropping even further to 1.6 million in 1973, when the Arab countries invoked an oil embargo in order to raise prices and revenue. In short, 1971 marked the beginning of a new era.<br />
  39. 39. Supply Curtailment by Foreign Oil Companies / Cartel formation /Geopolitical Alignment <br />
  40. 40. <ul><li>Oil is Important component of India’ s fuel basket - coal , oil , Gas, hydropower , renewables
  41. 41. Total annual demand in 2010 is 180 MMT
  42. 42. To grow at a compounded annual growth rate of 3%
  43. 43. Presently 80 % imported , expected to reach 90 % Dependency to increase </li></li></ul><li>Long Term Energy Security<br />Acquisitions of Oil fields around the world <br />Intensive Exploration in India for new Oil fields <br />New sources of energy , Nuclear , Wind , Solar , Hydrogen , Biofuels etc<br />Short Term Energy Security<br />Strategic Storage (90 days annual demand )<br />Product storage across the length and breadth of country (5 days local demand )<br />