US oil prices hit highest since mid-2015 on surprise output drop (29 December 2017): US oil prices hit their highest levels since mid-2015 on the final trading day of the year as an unexpected fall in American production and a fall in commercial crude inventories stoked buying. In international markets, Brent crude oil futures also rose, supported by ongoing supply cuts by top producers Opec and Russia as well as strong demand from China. US West Texas Intermediate (WTI) crude futures were at US$60.30 a barrel at 0504 GMT, up 46 cents or 0.8 per cent from their last close, the highest since June 2015. (Source: The National (UAE))
Arabian Gulf energy companies issue record debt to fund expansion (28 December 2017): Bloomberg - Arabian Gulf energy companies issued record debt this year as producers opted to exploit lower borrowing costs to fund expansion plans. Oil and gas producers, pipeline operators and refiners in Kuwait, the UAE, Saudi Arabia, Oman, Bahrain and Qatar borrowed a record US$28.7 billion through bonds and syndicated loans in 2017, eclipsing the previous high set two years earlier, according to data compiled by Bloomberg. (Source: The National (UAE))
How big data analytics are changing the oil and gas industry (27 December 2017): By AMIT MEHTA - HOUSTON -- Today, “big data” has become a ubiquitous phrase at any enterprise, primarily as data in volume, velocity and depth grows due to consumerization of the world. To understand its potential to change the oil and gas industry, one must first understand innovation dimensions and how they can be applied at any enterprise. Enterprise Innovations usually can happen around three possible dimensions: Business, Operations and Technology. (Source: World Oil)
Oil steady above $65 a barrel after holidays (26 December 207): Bloomberg - Oil held gains above US$65 a barrel as trading resumed following the Christmas holiday and after US explorers refrained from adding rigs for a second week. Brent for February settlement added 2 cents to $65.27 a barrel on the London-based ICE Futures Europe exchange. Prices gained 35 cents, or 0.5 per cent, to $65.25 Friday. The global benchmark crude traded at a premium of $6.73 to West Texas Intermediate. (Source: The National (UAE))
Shell’s Latest Acquisition Is Big News For UK Utilities (25 December 2017): By City A.M - Royal Dutch Shell is preparing to take on the UK's Big Six energy suppliers after it announced today it would buy First Utility, a leading challenger firm. The move represents an expansion of Shell's energy supply business from commercial and industrial customers to the residential sector. First Utility co-founder and chief financial officer Darren Braham said the acquisition will allow the firm to develop more innovative new services for its customers, including capitalising "on all the opportunities provided by digitalisation, decarbonisation and the move to battery technology and electric vehicles". (Source: Oil Price)
Eni's "mission impossible" points to seismic shift for major oil companies (22 December 2017): By CHIARA ALBANESE AND JAVIER BLAS - ROME and LONDON (Bloomberg) - The fact even senior managers privately described the plan as “mission impossible” showed the scale of the task: Italian energy giant Eni SpA wanted to produce gas from the Zohr field little more than two years after finding it in August 2015. But this week, the Mediterranean’s largest gas field -- lying about 200 kilometers (168 miles) off the Egyptian coast -- began pumping, defying skeptics both inside and outside the company.
The Top 8 Unknowns In 2018's Energy Markets (21 December 2017): By Peter Tertzakian - In this age of disruption, there are too many unknowns to honestly predict what will happen next week, let alone 52 of them into the future. So instead of predicting outcomes, I’ve decided to list the top eight unknowns in energy markets for 2018: Collateral disruption/ Bitcoin after-effects/ Cartel discipline/ Will Russia continue to side with OPEC?/ Middle Eastern geopolitics/ Canadian natural gas prices/ The electric vehicle halo/ Compliance with Paris (Source: Oil Price)
All-time low for discovered resources in 2017, Rystad reports (21 December 2017): OSLO -- Rystad Energy concluded this week that 2017 was yet another record low year for discovered conventional volumes globally. Less than 7 Bboe has been discovered YTD. “We haven’t seen anything like this since the 1940s,” says Sonia Mladá Passos, senior analyst at Rystad Energy. “The discovered volumes averaged at ~550 MMboe per month. The most worrisome is the fact that the reserve replacement ratio in the current year reached only 11% (for oil and gas combined) - compared to over 50% in 2012.” According to Rystad’s analysis, 2006 was the last year when reserve replacement ratio reached 100%; largely thanks to the giant onshore gas field Galkynysh in Turkmenistan. (Source: World Oil)
Green groups sue Trump administration over delay of methane rule (20 December 2017): WASHINGTON (Reuters) — A coalition of nearly 20 environmental and Native American tribal groups sued the Trump administration on Tuesday, challenging its delay of a rule limiting emissions of the powerful greenhouse gas methane from oil and gas drilling operations on federal lands. Earlier this month, the Bureau of Land Management, part of the Department of the Interior, suspended implementation of the rule for a year, until Jan. 17, 2019, saying it wanted to avoid compliance costs for energy companies as it revises the regulation.
Oil trades near $57 as U.S. crude stockpiles seen extending drop (19 December 2017): By GRANT SMITH LONDON (Bloomberg) - Oil traded near $57/bbl for a third day before data expected to show that surplus crude inventories in the U.S. continued to diminish as global markets rebalance. Futures rose 0.7% in New York after slipping 0.2% on Monday. Inventories probably lost 3 MMbbl last week, according to a Bloomberg survey before Energy Information Administration data Wednesday. Nigerian oil workers suspended strike action and agreed to continue talks next month, while output from a Libyan field returned to normal after a power outage. (Source: World Oil)
Inter Pipeline to build Canada’s first integrated PDH, PP complex (18 December 2017): CALGARY, Alberta — Inter Pipeline Ltd. announced that its board of directors has authorized the construction of a world-scale integrated propane dehydrogenation (PDH) and polypropylene (PP) plant. The facilities, collectively referred to as the Heartland Petrochemical Complex, are estimated to cost $3.5 B in aggregate and will be located in Strathcona County, Alberta near Inter Pipeline’s Redwater Olefinic Fractionator. (Source: Hydrocarbon Processing)
Small issues add to up to a big lesson for European gas supplies (17 December 2017): Robin Mills - A crack in a pipeline, a loose cap seal and a power cut, unrelated faults in three tiny components in Europe’s energy web, struck near-simultaneously last week. A cold snap had already brought snow to London and Birmingham. As gas supplies were cut sharply, European countries are reminded of their energy vulnerability in a changing market. The points of failure struck at three of Europe’s most critical pieces of gas infrastructure. The Forties pipeline, now 42 years old, suffered a crack last week which will take weeks to repair. This cost the United Kingdom about 10 per cent of its usual winter gas and sent prices up 55 per cent at one point. (Source: The National (UAE))
U.S. Solar Nearly Doubles Output In 2017 (16 December 2017): By Ron Patterson - According to the Electricity Monthly Update at the EIA web site: Net generation in the United States decreased by 4.9 percent compared to September 2016, in part because the country experienced a cooler September in 2017 than it did the previous year. Nuclear generated 4311 Gwh (6 percent) less than it did in August but, the decrease in the total generation meant its percentage contribution increased to 20.37 percent from 19.01 percent in August. A decrease in the absolute contribution from Solar from 7632 to 7384 GWh, translated to the percentage contribution actually increasing slightly to 2.21 percent, up from 2.09 percent in August. It is worthy of note that the percentage contribution from solar was below 2 percent in January and February only and continues to be on target to end the year with a contribution of slightly more than 2 percent, in line with the increase in capacity seen over the last twelve months.
The biggest voices in oil disagree on 2018 outlook (15 December 2017): By GRANT SMITH LONDON (Bloomberg) - The two most critical forecasts of global oil markets offer contrasting visions for 2018: one in which OPEC finally succeeds in clearing a supply glut, and another where that goal remains elusive. In the estimation of the Organization of Petroleum Exporting Countries, production curbs by the cartel and its allies will finally eliminate the excess oil inventories that have depressed crude prices for more than three years. But in the view of the International Energy Agency (IEA), which advises consumers, that surplus will barely budge. “Both cannot be right,” said Ole Sloth Hansen, head of commodity strategy at Saxo Bank A/S in Copenhagen. “Whichever way the pendulum swings will have a significant impact on the market.”
World Bank to stop upstream oil and gas financing after 2019 (14 December 2017): By Nick Snow - OGJ Washington Editor - The World Bank Group (WBG) reported it plans to stop financing upstream oil and gas projects in developing countries to help implement the 2016 Paris climate agreement’s goals. Exceptions will be considered where there is a clear energy access benefit for the poor and the project fits within the countries’ Paris agreement commitments, it said on Dec. 12 during the One Planet Summit in Paris. Current projects in its portfolio will continue as planned, WBG said. “For those countries with oil and gas resources, commercial financing is often readily available for exploration and production,” it said. “In exceptional circumstances in the poorest countries where there is a benefit to energy access, the World Bank Group will consider upstream natural gas projects.”
Shikoku Electric Power Co told to keep its Ikata No 3 closed and the plant off-line as Abe pushes to fire up atomic stations post-Fukushima (13 December 2017): Bloomberg - A Japanese court overturned a ruling that allowed a nuclear reactor in the country’s south to operate, frustrating the government’s push to bring online dozens of plants shut in the wake of the 2011 Fukushima disaster. Shikoku Electric fell as much as 11 per cent in Tokyo, the biggest intraday decline since May 2013.
One dead, 18 injured in fire at Austria's main gas hub (12 December 2017): VIENNA/LONDON (Reuters) — An explosion and fire that ripped through Austria's main gas pipeline hub on Tuesday killed one person and injured at least 18 others, prompting Italy to declare a state of emergency as flows from the strategic site were cut off. The Baumgarten site in eastern Austria, near Slovakia, is a major regional transfer node, taking natural gas from as far away as Russia and pumping it towards neighbours including Germany and Italy, its biggest recipient. "An explosion occurred this morning before 9:00 a.m. (0800 GMT) on the grounds of the Baumgarten Natural Gas Station," the company said. "The explosion caused a serious fire that has been contained to several small fires."
Opec, non-Opec to work on exit strategy for output curbs in June 2018 (11 December 2017): Jennifer Gnana - Opec and non-Opec producers will agree on a strategy in June to exit the production cuts agreement currently in place to rebalance the oil markets, the UAE energy minister said on Monday. Oil producers agreed in Vienna at the end of November to extend output curbs of around 1.8 million barrels a day until the end of 2018, subject to review in June. The global oil deal, which came into effect in January, was due to expire end of March. "There is a meeting in June and hopefully the market will be in a much better position for us to announce an exit strategy," Suhail Al Mazrouei said on the sidelines of a conference in Abu Dhabi. (Source: The National (UAE))
Footing The $9 Trillion Renewable Bill (10 December 2017): By Tsvetana Paraskova - The trillion-dollar question is, who will foot the bill? According to Bloomberg’s Nathaniel Bullard, the biggest future investors in clean energy could be the largest institutional funds that manage more than US$1 trillion of assets each. Basically, the money is out there, it just needs to be realigned to the demand for investment in renewable energy. Demand exists. Bloomberg New Energy Finance (BNEF) has estimated that zero-carbon power generation is expected to attract US$9 trillion of investment until 2040. (Source: Oil Price)
Bitcoin miners’ power needs could soar higher than global energy production by 2020 (9 December 2017): With the value of Bitcoin soaring ahead of the start of futures trading in it on Sunday, a digital analytical platform has warned that the energy usage required by the cryptocurrency will soar to unsustainable levels. Digiconomist says that the power currently used by the hardware used to mine the currency is 32.53 terrawatt-hours (TWh) a year. This makes it the equivalent of the 62nd biggest consumer of energy across the globe, placing it above Serbia and just behind Denmark, and this power requirement will only get higher. The current bubble building ahead of Sunday's launch of a bitcoin futures market by the Chicago-based CBOE Glomarkets Exchange has seen the price of a single unit soar to almost US$20,000 as investors piles into the currency. (Source: The National (UAE))
Putin to Saudi energy minister: buy our gas, save your oil -Interfax (8 December 2017): Russian President Vladimir Putin offered Saudi oil minister Khalid al-Falih to buy Russian liquefied natural gas (LNG) in order to spare Saudi Arabia's oil, the Interfax news agency reported citing him as saying on Friday. "Buy our gas and you'll save oil," Mr Putin told Mr Al Falih after having given the order to start loading the first gas tanker with LNG at the Novatek-led Yamal LNG project in the Arctic. (Source: The National (UAE))
Kepco Picked as Top Bidder for Toshiba's U.K. Atomic Project (7 December 2017): By Heesu Lee and Stephen Stapczynski - Korea Electric Power Co. has been picked as the preferred bidder for Toshiba Corp.’s nuclear reactor project in the U.K. amid a push by the South Korean company to expand into the international market. Kepco, as the utility is known, has started exclusive negotiations with Toshiba for NuGen, which is developing a nuclear power plant in northwest England’s Moorside, the company said in a statement Wednesday. Negotiations will take several months and the deal, which requires U.K. approvals, could be completed in the first half of next year, it said. A Toshiba spokeswoman confirmed the decision. (Source: Bloomberg)
Analysts Raise 2018 Oil Price Forecasts After OPEC Deal (6 December 2017): By Tsvetana Paraskova - The extension of the OPEC and allies’ production cut deal through the end of 2018 is sending a stronger signal that the oil market rebalancing could speed up and send WTI oil prices to average $54.78 a barrel in 2018, up from a previous projection of $52.50, a Reuters poll of 30 analysts and economists showed on Wednesday. The experts surveyed now expect Brent Crude to average $58.84 a barrel next year, compared to a forecast of $55.71 per barrel for 2018 in the previous Reuters poll conducted at the end of October. (Source: Oil Price)
Fear Will Drive Oil Prices Higher In 2018 (5 December 2017): By Robert Rapier - The price of oil has always been driven by cycles of fear and complacency. During the cycle of fear, geopolitical events can send the price of oil soaring. During the cycle of complacency, oil prices will fall on bad news (e.g., the appearance of too much supply or weakening demand), but often seem immune to bullish news. Over the past decade, the world has experienced both cycles. (Source: Oil Price)
Saudi Arabia invites US firms to participate in its nuclear power programme, energy minister says (4 December 2017): Reuters - Saudi Arabia has invited US firms to take part in developing its civilian nuclear power programme, Energy Minister Khalid Al Falih said on Monday, adding the kingdom was not interested in diverting nuclear technology to military use. Reuters has reported that Westinghouse is in talks with other US-based companies to form a consortium for a multi-billion-dollar project to build two reactors and that those firms are pushing Washington to restart talks with Riyadh on a civil nuclear cooperation pact. (Source: The National (UAE))
Gulf states can lead the way with carbon capture (3 December 2017): Robin Mills - As Opec’s latest meeting in Vienna concludes, another event opens in Abu Dhabi on Monday, one that will perhaps prove to be more important for the energy industry’s long-term future. Ministers and experts are gathering under the auspices of the Carbon Sequestration Leadership Forum (CSLF). With progress in carbon capture moving too slowly to prevent dangerous climate change, can such a forum kick-start it? Arabian Gulf states and other major oil-exporters have a key role to play in the global governance of carbon capture and storage (CCS). Organisations such as the CSLF could be crucial, if the big petroleum states can build the right alliances. (Source: The National (UAE))
Russia Takes Action To Clean Up Soviet Era Nuclear Waste (2 December 2017): By Eurasianet - Confronting one of the most hazardous environmental legacies of the Soviet era, Russian authorities are taking steps to clean up a decades-old problem posed by nuclear waste in Arctic areas. On October 31, officials sent a second shipment of spent fuel rods from Andreeva Bay near the Norwegian border to the Mayak reprocessing plant in Ozersk, the closed city in Chelyabinsk Oblast that served as the cradle of the Soviet nuclear weapons program. The first delivery of nuclear waste occurred in June. The cleanup has been partially funded by European countries and Japan, with Norway alone contributing $230 million since the mid-1990s. (Source: Oil Price)
Goldman: Oil Markets Are Nervous For No Reason (1 December 2017): By Tsvetana Paraskova - The extension of the OPEC/non-OPEC production cut pact through to the end of 2018, and especially the fact that the cartel and allies included an option to review progress in June, reduces the risk of both sudden supply surges and excessive drawdowns, Goldman Sachs says, noting that investor anxiety is higher than it should be. The lowered risk of sudden sharp movements in supply and inventory drops “leads us to reiterate our view that long-dated implied volatility remains too rich,” Goldman Sachs analysts including Damien Courvalin and Jeffrey Currie said in a report dated November 30, as carried by Bloomberg. (Source: Oil Price)