new base energy news issue 931 dated 26 september 2016

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NewBase Energy News 26 September 2016 - Issue No. 931 Edited & Produced by: Khaled Al Awadi

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UAE: Masdar and Korean Advanced Institute to hold workshop on sustainable technologies

(WAM) -- The Masdar Institute of Science and Technology and the Korea Advanced Institute of Science and Technology, KAIST, will hold a joint workshop on 'Advanced Energy and Sustainable Technologies’, on 28th and 29th September at the Masdar Institute Innovation Centre.

Ten faculty members from the Materials Science Engineering and Microsystems Engineering programmes of the Masdar Institute will present their work at the workshop, while five members of the KAIST Materials Science and Engineering Department and Electrical Engineering Faculty will be presenting their work, in addition to discussing potential collaboration between the institutions.

Dr. Behjat Al Yousuf, Interim Provost of Masdar Institute, said, "This workshop reflects Masdar institute’s leading role in bringing international innovation leaders to the UAE to share their expertise and inspire further research collaboration. We are honoured to host Korean researchers for the workshop and look forward to seeing the results of this great meeting of minds here in the UAE."

The President of KAIST, Dr. Sung-mo Kang, said, "I am happy to see Koran institute faculty members’ efforts to expand our international cooperation with the UAE. I believe this workshop will present a great opportunity for two institutions to forge a close partnership that will lead to fruitful collaborations in the future."




Enec completes 70pc work at UAE nuclear plant WAM Work is progressing well on the Barakah nuclear power project in Abu Dhabi, UAE, with about 70 per cent of the construction completed at all the four units of the plant, said a report, citing the Emirates Nuclear Energy Corporation (Enec). The major contract for the four 1,400-MW nuclear power plants was awarded by Enec to a consortium led by the Korean Electric Power Corporation (Kepco), the world’s third largest nuclear energy company.

As per the deal, the consortium will design, build and operate the plants in the UAE. The first unit is expected to start operation next year, while the other three are scheduled for completion by 2020. Enec chief executive Mohamed Al Hammadi said it was proud of the progress made in the development of the UAE Peaceful Nuclear Energy Programme, according to state news agency Wam. "All four units are about 70 per cent complete, an amazing achievement, considering that we started construction a mere four years ago," Al Hammadi was quoted as saying in the report. "Most recently, we installed Unit Three’s reactor vessel, completed the construction of the concrete dome for the Unit Two reactor containment building, and are progressing steadily through the testing and commissioning phase at Unit One, where the structural integrity and integrated leak tests were recently completed,'' he added.




Qatar-Indonesia joint Energy investment fund in ‘final stages’ Gulf Times

The $1bn joint investment fund (JIF) by Qatar and Indonesia, which was reactivated by state leaders in 2015, is nearing its final stages, and is expected to fund major infrastructure and energy projects, an official has said.

Special envoy to the Indonesian president for Middle East Affairs Dr Alwi Abdurrahman Shihab said Indonesia’s share of the JIF (15%) “is ready.” He also said the government is just waiting for the Qatar Investment Authority (QIA) to select from several projects Indonesia has prepared to start the JIF.

“This joint investment fund should be, as soon as we can, made into a reality because the Indonesians have

already provided four to five projects to be picked by the Qatar Investment Authority (QIA) in order for us to show the Indonesian people that the investment is there,” Shihab said during a meeting with Qatar Chamber vice chairman Mohamed bin Towar al-Kuwari on Sunday.

“The reactivation of the joint investment fund in 2015 is a manifestation to improve the economic cooperation between Qatar and Indonesia. It will be utilised in infrastructure, roads, power plants, ports, mining, and communications. Negotiations are underway,” Shihab told Gulf Times on the sidelines of the meeting.

The JIF was set up in 2008 but was “shelved for a number of factors,” Indonesian Minister of Foreign Affairs Retno LP Marsudi said last year during the Indonesia-Qatar Business and Investment Forum in Doha.

For the JIF, Qatar will provide 85% of the funds, while Indonesia will shoulder 15%, Shihab said. He said the JIF is also a response to Indonesian President Joko Widodo’s thrust to improve Indonesia’s infrastructure.

During his state visit to Qatar in 2015, Widodo encouraged the Qatari government and its business community to invest in Indonesia’s mega projects that are now in the pipeline, including 24 new seaports, 15 new airports, 2,630km of new roads, 35,000MW power plants, and mass rapid transportation systems in as many as 23 cities.

Widodo said the major projects will complement Indonesia’s aim to establish the country as a manufacturing and production hub. He added that Indonesia has allocated $21bn from its 2016 national budget for infrastructure projects.

Kuntum Khaira Ummah, third secretary at the Indonesian embassy in Doha, said Qatari investments in Indonesia include those by the QIA ($1bn), Nebras Power ($750mn), QNB (around $1.6mn), and Ooredoo.

Shihab also invited Qatari businessmen to visit Indonesia and participate in the 31st Trade Expo Indonesia 2016 from October 12 to 16 in Jakarta.

For his part, Qatar Chamber vice chairman Mohamed bin Towar al-Kuwari encouraged the Indonesian business community to explore opportunities in Qatar. He said: “This is the right time to visit Qatar because the state is looking for new investors,” he said.




Algeria: Eni to cooperate with Sonatrach on renewable energy projects Source: Eni

Eni has reached a strategic agreement with Sonatrach for the implementation of renewable energy projects in Algeria.

The first project will be the construction of a 10 MW photovoltaic plant in the Bir Rebaa North (BRN) field, co-operated by the two companies through GSA (Sonatrach-Agip Groupement). The goal is to start activities before the end of the year.

This project is a step of the strategic cooperation agreement on renewable energies in Algeria that Eni's CEO, Claudio Descalzi, and Sonatrach’s CEO, Amine Mazouzi discussed on June 21, and just one of the initiatives that the two companies plan to develop in the near future.

The agreement with Sonatrach fits in Eni’s long-term strategy, aimed at integrating its traditional business and energy from renewable sources, making the most of all possible industrial, logistic, contractual and commercial synergies with the company's traditional activities.

Eni’s CEO Claudio Descalzi: 'In the early seventies, Eni was the first foreign company to sign an agreement with the Algerian state, for the construction of the Transmed gas pipeline, and, in 1987, the first oil & gas company to sign an upstream contract in Algeria. Today Eni is the first oil & gas company to reach a strategic agreement in the field of solar energy in Algeria, a country with an important potential'.




Egypt:LNG Traders Eye One Last Bonanza as Demand Nears Peak Bloomberg - Anna Shiryaevskaya

The world’s biggest liquefied natural gas traders will be lining up for what may be the last billion-dollar payday from Egypt.

Egypt is seeking about 120 LNG cargoes for next year, worth about $2.4 billion at current spot prices in Singapore. That may be “the last big tender” if recent discoveries in the North African nation start production in 2018, according to Maggie Kuang, an analyst in Singapore at Bloomberg New Energy Finance.

The most populous Arab country’s soaring demand and short-term volume requirements helped offset slumps in top LNG importer Japan amid a global glut, benefiting traders from Trafigura Group Pte to Noble Group Plc as well as producers such as Algeria’s Sonatrach.

From 2018, Egypt may start regaining self-sufficiency in gas as the super-giant Zohr field starts, leaving traders to seek other demand outlets.

“This is a big tender in a weak market, and I am sure that there will be considerable interest,” David Ledesma, an independent energy consultant with 32 years of experience, said by e-mail. “As Zohr starts up, Egypt’s LNG import requirements may reduce, but it always takes time for new gas supply.”

Egyptian LNG demand will climb 5 percent next year after a 60 percent jump in 2016 before dropping 40 percent from current levels in 2018, according to Bloomberg New Energy Finance. By 2021, the nation may stop LNG imports started last year and two export plants may resume operations after gas was diverted to meet domestic power demand, according to the Oil Ministry and the Cairo-based Al Borsa newspaper.

Engie SA, the French energy company that has a contract to receive 3.6 million tons of LNG a year from Egypt, doesn’t expect the country to resume exports anytime soon, Philip Olivier, chief executive officer of the company’s global LNG business, said Wednesday at a conference in




Singapore. Exports could return in the long term as new projects come online and potentially gas production from Cyprus is tied into the plants, he said.

State-run Egyptian Gas Holding Co. in June said it will need about 120 cargoes next year. The tender is expected to be issued in the next week, New York-based World Gas Intelligence said Sept. 21. EGAS, as the company is known, didn’t reply to calls seeking comments.

Egypt’s Oil Ministry said last month that it plans to in the fourth quarter pay dues owed to foreign oil companies as the nation struggles to shake the economic and political turmoil that followed President Hosni Mubarak’s ouster in 2011. Oil and gas majors may be more cautious than trading houses to participate because of the credit risk involved, said Andy Flower, an independent energy analyst.

Future imports will depend on how quickly Eni SpA develops Zohr, which the Rome-based company discovered last year and said was the largest gas find in the Mediterranean Sea. It will start drilling a sixth well and production is set to begin by the end of 2017. It also made a separate “significant” discovery with BP Plc this year.

‘Significant’ Reserves

“Egypt has been blessed with significant natural gas reserves and the days of significant LNG imports is approaching its end,” said Claudio Steuer, director at SyEnergy, a Poole, England-based energy consultancy, who was involved in gas master planning for Egypt in the late 1990s. “Producing Zohr and other assets has some technical challenges” that international oil companies can address.

The waning of Egyptian imports would come just as the market glut is expected to fade following a 50 percent jump in global liquefaction capacity. The International Energy Agency expects supply and demand to align by 2021.

LNG imports became attractive for nations such as Egypt after prices fell 61 percent over the

past two years. Future choices will depend on prices, said Anne-Sophie Corbeau, a research fellow at Riyadh-based King Abdullah Petroleum Studies and Research Center.

“The price level is key,” she said. “If LNG is too expensive, in absolute terms and relative to domestic gas production, then they will probably phase imports out.”




Algeria: Skikda LNG plant back in service LNG World News Staff

Algeria’s Skikda LNG export plant has reportedly come back on stream following a two-month shutdown for maintenance.

First cargoes from the facility, that was shut down for two months mostly due to a drop in LNG exports to Spain during August due to lower demand, were shipped last week, Platts reports.

The final cargo from the Sonatrach’s 4.7 mtpa export plant was shipped on July 11 before the mid-July maintenance started.

The first cargo to leave the plant following the maintenance completion was Cheikh Bouamama followed by Cheikh el Mokrani, each loading 45 million cubic meters of gas equivalent.

The first vessel delivered its cargo to Elengy-operated Fos Cavaou LNG terminal in France with the second cargo expected to be delivered to Spain’s Sagunto terminal on Friday.

Since September 1, 2015, the plant delivered about 2 billion cubic meters of gas to the Spanish market, accounting for 15 percent of the country’s total imports of 13.3 bcm during the past year, according to the report.

Despite the Skikda two-month maintenance, Algeria’s LNG exports are at the same level with 2015 volumes.




US:First shipment of ethane from US Coast arrives in Europe Source: U.S. Energy Information Administration, Natural Gas Monthly

Increased production of ethane in the United States has led to increased ethane exports, first by pipeline to Canadaand more recently by tanker to overseas destinations. Ethane is used domestically and internationally as a key feedstock for plastics production and other industrial uses.

The first U.S. ethane export terminal, located in Marcus Hook, Pennsylvania, about 20 miles southwest of Philadelphia, has an export capacity of 35,000 barrels per day (b/d) and began shipping ethane cargos in March 2016.

The second U.S. ethane export terminal, opened by Enterprise Products Partners in Morgan's Point, Texas, recently sent its first shipment to Norway. This 200,000 b/d-capacity facility, located on the Houston Ship Channel, is the first ethane terminal in the Gulf Coast region.

Ethane is typically extracted from unprocessed natural gas, along with other natural gas plant liquids (NGPL). Unlike heavier natural gas plant liquids—such as propane, butanes, and natural gasoline—significant amounts of ethane can be left in natural gas transported on pipelines to natural gas customers, a practice known as ethane rejection.

The relative tendency to either reject or recover ethane (i.e., leave it in the natural gas stream or separate it and market it)depends on ethane prices and demand and the ability of facilities to remove ethane from raw natural gas.

Because ethane has a higher heat content than methane—the primary component of natural gas—higher heat content of a natural gas stream often indicates that ethane is being rejected, or left in the natural gas sold to natural gas users.

EIA has collected monthly data on natural gas heat content by state since 2013. The heat content of natural gas in states that receive shale gas produced from the Marcellus and Utica formations, such as Ohio, Maryland, Delaware, and Pennsylvania, has been consistently reported at or above national average levels.

Ohio, in particular, receives a higher portion of its natural gas from the Marcellus and Utica formations. However, since early 2016, the natural gasheat content in these states has trended




downward, indicating that producers have increasingly been extracting ethane. The lower heat content has coincided with the start of ethane exports out of Marcus Hook, which sources all of its ethane from the Marcellus and Utica formations.

From 2010 to 2015, the ethane share of total NGPL production dropped from 42% to 34%. Although other natural gas plant liquids have found ready markets close to key shale plays such as the Marcellus and Utica formations, the lack of pipelines and local markets for ethane in these areas has limited ethane recovery.

With more export capability and growth in domestic petrochemical demand, more ethane is expected to be recovered and brought to market.

EIA's Short-Term Energy Outlook projects NGPL production to continue growing, from 3.6 million barrels per day (b/d) in May 2016 to 4.0 million b/d in December 2017.

Nearly half of the projected total increase in NGPL production is ethane. Although an expectation of increasing oil prices and an associated increase in NGPL prices contributes to the outlook, a major driver of increased ethane production is growth in ethane demand, both within the United States and internationally.




NewBase 26 September 2016 Khaled Al Awadi

NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE

Oil prices rebound after Algeria says all options open at OPEC meeting Reuters + NewBase

General view of the 169th meeting of the Organisation of Petroleum Exporting Countries (OPEC) in Vienna, Austria on June 02, 2016.

Crude prices rebounded on Monday after Algeria's energy minister said the day before that all options were possible for an oil output cut or freeze at this week's informal meeting of OPEC producers.

That came after prices tumbled 4 percent on Friday amid signs Saudi Arabia and Iran were making little progress in achieving preliminary agreement to freeze production.

Members of the Organization of the Petroleum Exporting Countries will meet on the sidelines of the International Energy Forum in Algeria from Sept. 26-28, where they will discuss a possible output-limiting deal.

"We will not come out of the meeting empty-handed," Algerian energy minister Noureddine Bouterfa said in Algiers on Sunday.

U.S. West Texas Intermediate (WTI) crude futures had climbed 42 cents to $44.90 a barrel as of 0914 GMT after falling $1.84, or 4 percent, in the previous session. U.S. crude gained 3 percent last week.

Brent crude futures advanced 42 cents to $46.31 after settling down $1.76, or 3.7 percent, at the previous close. The benchmark rose 0.3 percent last week.

Oil price special

coverage




"The fact countries like Algeria are still talking about a deal means it's still on the table regardless of others' views about what might be happening," said Jonathan Barratt, chief investment officer at Sydney's Ayers Alliance.

"I expect Algeria and Venezuela to keep pushing for a deal - it's imperative for them to keep the price up," Barratt said.

So far there are mixed signals on whether a deal on cutting or freezing production is possible.

Sources told Reuters on Friday that Saudi Arabia did not expect a decision to be made in Algeria, while Saudi Arabia had also offered to reduce production if Iran caps its own output

this year, an offer to which Tehran had yet to respond.

"With discussions around a production freeze at OPEC heating up, oil prices are likely to remain volatile early this week," ANZ said in a note on Monday.




NewBase Special Coverage

News Agencies News Release 26 September 2016

Saudis Announce Oil Deal (In Your Dreams) By Julian Lee

Oil prices are low, and producers are hurting. Iraq is the latestOPEC nation to publicly say next week's meeting in Algeria can conclude with steps to tackle a global supply glut and raise prices. Without the Saudis on board, that is no more than a dream.

For a meaningful impact, any agreement would need to remove crude from the market, not just freeze production. Algeria's Noureddine Boutarfa puts the size of the cut needed at 1 million barrels a day.

Awash in Oil

Hopes for a production freeze, or reversal, in Algiers look faint given that some big producers are pumping out supply either at or near record levels.

NOTE: The figure for Iran is its highest post-revolution production. Output briefly exceeded 6 million barrels a day in 1976-77.

Saudi Arabia would have to bear the brunt of any reduction: it's the biggest producer in the group, it's increased supply by a million barrels a day in the past two years, and a decent-sized cohort will either seek to be excused from cutting or want to raise output to restore lost volumes.

Were it to implement a meaningful cutback, it would be resuming the swing producer role it abandoned in Nov. 2014.

True, like producers everywhere, the kingdom has been hit hard by the fall in oil prices. It's burning through its foreign reserves at a furious rate and cost-cutting may lead it to cancel $20




billion worth of projects. It has a clear incentive to act to lift oil prices. But for Saudi Arabia this was never about short-term income.

Burning Through Reserves

Saudi Arabia is spending $9 billion a month of foreign reserves - 1 1/2 times as much as in 2008-2009.

To make such a volte face, it will have to do one of two things. It could claim that supply and demand are now in balance, and it's time for OPEC to manage production again and boost prices. That would stretch the limits of credibility when OPEC's just published forecasts that rebalancing won't happen until the second half of next year.

Or it could admit to its fellow OPEC members that it had got it wrong.

You can just picture the scene in Algiers:

Saudi Arabia's oil minister Khalid al-Falih (rising to his feet): Gentlemen, the Kingdom of Saudi Arabia now realizes that refusing to cut our production to support oil prices in Nov. 2014 was a mistake.

Sharp intakes of breath from the other delegates in the room

Al-Falih: We were wrong to believe that allowing the price to fall would quickly bring an end to growth in U.S. shale oil production and the cancellation of projects to develop new high-cost reserves.

Widespread nodding of heads

Al-Falih (aside, audible only to his team): Even though that is exactly what has happened.




Al-Falih (speaking to the delegates again): We recognize that our decision has cost you all billions of dollars in lost revenue and pushed some of your countries close to collapse. Sorry for that.

As a token of our humility, we will cut our output by a million barrels a day, while you all go on producing as much as you can, raising your output where possible.

We won't try to follow a policy that seeks to preserve a market for our oil in an increasingly challenging environment, where future demand for the one commodity on which we all depend will be undermined by a surge in rival production, while improvements in energy efficiency and growing environmental concerns shrink the market for oil.

Yes, oil will remain an important fuel for the next 20 or 30 years -- which will be more than enough for many of you who have limited reserves -- but which is a mere blink of an eye for the rest of us.

No longer will we take a long-term view of oil supply and demand. Instead, like everybody else, we will focus only on the next six months and hope the future takes care of itself.

In short, we will bury our heads in the sand -- after all, we have plenty of that too.

Al-Fahli sits down amid stunned silence

Somehow, I just can't see it happening. Hopes that a deal will be struck got a lift at the end of last week from rumors about offers the Saudis made to Iran. The reality is that these are no more than words in the wind.




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Khaled Malallah Al Awadi, Energy Consultant MS & BS Mechanical Engineering (HON), USA Emarat member since 1990 ASME member since 1995 Hawk Energy member 2010

Mobile: +97150-4822502 [email protected] [email protected]

Khaled Al Awadi is a UAE National with a total of 26 years of experience in the Oil & Gas sector. Currently working as Technical Affairs Specialist for Emirates General Petroleum Corp. “Emarat“ with external voluntary Energy consultation for the GCC area via Hawk Energy Service as a UAE operations base , Most of the experience were spent as the Gas Operations Manager in Emarat , responsible for Emarat Gas Pipeline Network Facility & gas compressor stations . Through the years, he has developed great

experiences in the designing & constructing of gas pipelines, gas metering & regulating stations and in the engineering of supply routes. Many years were spent drafting, & compiling gas transportation, operation & maintenance agreements along with many MOUs for the local authorities. He has become a reference for many of the Oil & Gas Conferences held in the UAE and Energy program broadcasted internationally, via GCC leading satellite Channels. NewBase : For discussion or further details on the news above you may contact us on +971504822502 , Dubai , UAE

NewBase 26 September 2016 K. Al Awadi