Four large-scale shifts in the global energy system set the scene for the World Energy Outlook 2017: the rapid deployment and falling costs of clean energy technologies, the growing electrification of energy, the shift to a more services-oriented economy and a cleaner energy mix in China, and the resilience of shale gas and tight oil in the United States.
These shifts come at a time when traditional distinctions between energy producers and consumers are being blurred and a new group of major developing countries, led by India, moves towards centre stage.
How these developments play out and interact is the story of this year’s Outlook.
Disruption in Iran could force OPEC to adjust up production levels earlier than it had expected and could prompt U.S. shale drillers in West Texas to drill more. Despite these efforts to fill in for lost supply, analysts at Bank of America still expect oil to reach $100 per barrel in 2019.
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OPEC and IEA Reports Up Next
On Monday, traders and analysts will get a look at the latest OPEC monthly oil market report. Key data to watch for are any additional upward revisions to world oil demand. Last month, OPEC revised 2018 world demand growth to 1.63 million barrels per day. Total demand for the year is forecast to average 98.7 million barrels per day. Traders will also be looking at OPEC’s world supply expectations. In last month’s report, OPEC said that it expects non-OPEC supply to grow by 1.71 million barrels per day in 2018, with the U.S. accounting for most of the supply growth.
by Paul Homewood, May 15, 2018 in NotaLotofPeopleKnowThat
From the US EIA:
Egypt, Oman, Iran, Jordan, and the United Arab Emirates (UAE) have no current coal-fired electricity generation, but they each plan to build coal capacity in the near future. New coal capacity is currently under construction in the UAE, Iran, and Jordan. In addition, Egypt and Oman have announced plans for new coal-fired generators.
In the UAE, new coal-fired capacity will come from Dubai’s Hassyan Project. The project consists of 3.6 GW of ultra-supercritical generating capacity, 2.4 GW of which is currently under construction and expected to become operational between 2020 and 2022. Another 1.2 GW was announced for a total of 6 units (with an average size of 600 megawatts (MW) expected to come online in 2023. The $3.4 billion project is sponsored by several investors, including Chinese and domestic banks.
Crude markets have seen a wave of bullish news in the last couple of weeks, and as tensions in the Middle East continue to rise and Venezuela falls further into crisis, upward pressure on prices is only increasing.
by S. Graham, May 9, 2018 in ClimateChangeDispatch
World fund managers predict a fall in the value of oil companies. According to a survey published last month in the United Kingdom, climate change risks will force a lower valuation of oil company stock prices within the next five years.
But despite many predictions of demise over the last 50 years, global consumption of hydrocarbon energy continues to grow
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We’ve heard this many times before. In his address to the nation on April 18, 1977, President Jimmy Carter stated, “…we could use up all the proven reserves of oil in the world by the end of the next decade.”
Energy produced offshore is a major component of global oil and natural gas supply and could provide an increasingly important source of renewable electricity. Resources are enormous, but offshore projects have to prove their worth in a changing market and policy context, amid a variety of pressures on the world’s oceans.
More than a quarter of today’s oil and gas supply is produced offshore, mostly in the Middle East, the North Sea, Brazil, the Gulf of Mexico and the Caspian Sea. While offshore oil production has been relatively stable since 2000, natural gas output from offshore fields has risen by more than 50% over the same period. Offshore electricity generation, mainly from wind, has increased rapidly in recent years, notably in the relatively shallow coastal waters of Europe’s North Sea.
As global oil markets shift their attention from U.S. shale oil production back to a resurgent Saudi Arabia and Russia and geopolitical concerns bearing down on oil prices, Citigroup said last Wednesday that the U.S. is poised to surpass Saudi Arabia next year as the world’s largest exporter of crude and oil products.
The U.S. exported a record 8.3 million barrels per day (bpd) last week of crude oil and petroleum products, the government also said Wednesday. Top crude oil exporter Saudi Arabia’s, for its part, exported 9.3 million bpd in January, while Russia exported 7.4 million bpd, the bank added.
However, it should also be noted that the Citi projection is for both crude and finished (refined) petroleum products, not only crude oil. Saudi Arabia remains the world’s largest exporter of crude, though since January amid the OPEC/non-OPEC production cut agreement that figure has fallen. On April 10, the Saudi oil minister said that the kingdom planned to keep its crude oil shipments in May below 7 million bpd for the 12th consecutive month (…)
The Republic of the Congo has suffered dearly during the oil collapse; and Congolese President Denis Nguesso has pledged that the country would no longer be sitting on the side lines, suffering the effects of global decision-making in the oil industry without a voice. In an official communiqué announcing the bid for OPEC membership, he stated that he wished to “place our country in the rank of the world’s leaders.”
At nearly 2 billion barrels of crude oil of proven reserves in a vastly underexplored territory, Congo represents a sleeping giant amidst African oil producers. An improved business climate has brought profound benefits to the country’s oil industry. New developments by French oil company Total in Congolese territory are set to expand the country’s oil output from 280,000 barrels per day to 350,000 in 2018.
The Permian shale play is all about setting records. Now, the region may even become the world’s largest oil patch over the next decade.
Output in the basin is forecast to reach 3.18 million barrels a day in May, according to the Energy Information Administration. That’s the highest since the agency began compiling records in 2007. By 2023, the basin may produce 4 million barrels a day, according to the International Energy Agency. The Ghawar field in Saudi Arabia is currently the world’s biggest oil field, with capacity of 5.8 million barrels a day, according to a 2017 EIA report.
Sky News, one of Australia’s most popular news services, just gave climate skeptic and geologist Ian Plimer an honest opportunity to explain what is wrong with Australia’s climate obsessed energy policies.
Geologist Ian Plimer told The Outsiders that Energy Minister Josh Frydenberg had caught himself ‘between a rock and a hard place’ when it comes to the government’s energy policies. Mr Plimer said it wasn’t possible for the energy market to provide cheap and reliable energy, but also reduce emissions.
Oil saw significant gains in anticipation of the strikes in Syria, but following U.S. efforts to ease geopolitical tensions in the region, crude prices have stabilized.
There are still some kinks to be worked out. The process to generate hydrogen from coal produces a monstrous amount of CO2 – far more CO2 per unit of useful energy than simply burning the coal would produce. But with hydrogen production, unlike hydrocarbon combustion, all the CO2 is produced in one place. This creates an opportunity for carbon sequestration, when technologies to sequester carbon on such an impressive scale are developed.
(Bloomberg) — For all the buzz around wind, solar and electric cars, energy company executives had plenty to say Tuesday about the continuing role of fossil fuels and nuclear power at the Bloomberg New Energy Finance Future of Energy Summit.
Mining mogul Bob Murray offered a passionate defense of coal, asserting that we’d all “die in the dark” without it. Ethan Zindler, a Bloomberg New Energy Finance analyst, supplied the counter argument, saying U.S. coal-plant economics simply don’t work anymore. Here’s what executives from BP Plc to Tellurian Inc. said about the future of fossil fuels in a world pushing to fight climate change.
The New Zealand government has made the surprise announcement that it will not grant any new permits for offshore oil and gas exploration.
The Labor government of Prime Minister Jacinda Ardern said the move would not be retrospective. The country’s 22 existing offshore exploration permits along with any discoveries made in them could still lead to the granting of production licenses of up to 40 years duration.
Utica Midstream conference gives update on Utica Shale production and development.
NORTH CANTON Ohio has produced more natural gas than it uses since early 2015. Driven by prolific Utica Shale wells, the state produced a record 1.7 trillion cubic feet of natural gas last year.
Much of the regional economic development around that production has been in the form of pipelines and processing facilities.
Two interstate natural gas pipelines — Energy Transfer’s Rover project and the NEXUS Gas Transmission pipeline — cross Stark and neighboring counties.
As the U.K. celebrates its final year as part of the European Union, it is standing on the brink of a major boost to its economy and prosperity as it awaits the first economic benefit from its rich oil and gas shales (…)
by P. Homewood, April 8, 2018 in NotaLotofPeopleKnowThat
Bit by bit, some reality appears to be intruding into the make believe world of the Climate Change Act:
No credible scenario’ exists for hitting the UK’s 2050 decarbonisation targets without continued reliance on gas, the National Grid has warned.
In a new report, entitled The Future of Gas: How gas can support a low carbon future’, the grid says that it is not feasible to switch over to electric heating on the scale required to reduce greenhouse gas emissions to 80 per cent of 1990 levels by the middle of this century.
Sheikh Mohammed bin Khalifa al-Khalifa said it was not yet known how much of the oil could be extracted. The scale of the find, however, is about to make it a big player in the global market, significantly boosting its economy and raising its profile in the region, where it plays a smaller fiddle to its giant neighbour, Saudi Arabia.
by P. Homewood, April 3, 2018 in NotaLotofPeopleKnowThat
A joint report by Greenpeace, the Sierra Club and CoalSwarm indicates that Southeast Asia will be the new epicentre of coal production. Asia accounts for 85 per cent of new coal power development in the world’s top 20 coal producing countries, with China as the leader of the pack. However, while tighter restrictions on domestic coal plants have been imposed by the central government to curb pollution, Beijing has pushed the development of high-efficiency, low-emission coal plants across Southeast Asia as part of the “Belt and Road Initiative”.
As China is expanding its influence, Beijing’s foremost strategic competitor in Asia, Japan, is being forced to step up efforts to combat its shrinking influence in the region. The booming energy sector of Southeast Asia, especially coal, is proving to be the new front line in the geopolitical rivalry between Asia’s two industrial giants.
by Kelly Gilblom, March 26, 2018 in BloombergMarkets
Big Oil’s weight in equity indices to rise from 50-year low
Cost cuts, recovering oil prices put companies in a sweet spot
The world’s largest oil companies have survived a life-changing crisis, and are now poised to reap the rewards, Goldman Sachs Group Inc. said.
Big Oil is in a sweet spot with rising oil prices and low operating costs, leaving them with the biggest cash-flow growth in two decades and boosting earnings, Goldman said in a report Monday. That will increase their attraction for investors after years of elevated spending followed by crude’s slump sent their weighting in global equity indexes to a 50-year low, according to the bank (…)
U.S. exported more natural gas in 2017 than it imported for the first time in 60 years, according to the Energy Department.
Natural gas production has boomed in recent years, particularly in Pennsylvania and other parts of Appalachia, thanks to hydraulic fracturing or fracking and horizontal drilling. The boom has offset Canadian imports and allowed U.S. companies to ship more fuel abroad.
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