New base 09 january 2018 energy news issue 1125 by khaled al awadi

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NewBase Energy News 09 January 2018 - Issue No. 1125 Senior Editor Eng. Khaled Al Awadi

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

DEWA strengthens ties with French company Suez, Energy

(WAM) -- Saeed Al Tayer, Managing Director and CEO of Dubai Electricity and Water Authority, DEWA, has received a high-level delegation from the French company Suez. The visit supports DEWA’s collaboration with international organisations to share best practices and knowledge in the energy and water field.

The delegation included Pierre Pauliac, Chief Executive Officer Middle East, and Jean-Marc Farrugia, Municipal Business Development Director Middle East. The meeting was attended by Waleed Salman, VP Business Development and Excellence in DEWA.

Al Tayer welcomed the delegation and briefed them on DEWA's efforts in establishing the infrastructure for electricity and water services in Dubai, as per the highest standards and best global practices. He added that DEWA's strategic priorities are energy supply security, and positioning Dubai to become a global role model regarding energy efficiency and reliability, a green economy and sustainability.

DEWA is currently establishing the Mohammed bin Rashid Al Maktoum Solar Park, which will become the largest single-site solar park in the world based on the Independent Power Producer model, with a total planned capacity of 5,000 megawatts by 2030 and a total investment of AED50 billion. The delegation presented the latest Suez projects and expressed their interest in participating in DEWA projects in Dubai.




UAE: Fewa awards staff for excellence in work NewBase + Business Arabia

The UAE's Federal Electricity and Water Authority (Fewa) awarded employees for excellence and dedication in their respective fields of work at the Fourth Excellence Awards held today. The special ceremony was held to support the authority’s vision of instilling the culture of excellence, creativity and quality among employees. This recognition aims to motivate employees who excel in achieving the highest levels of performance, teamwork, and giving. It promotes fair competition to develop the authority in line with the best international standards.

The awards ceremony was held under patronage and presence of Suhail Mohammed Al Mazrouei, Minister of Energy and Industry, chairman of the Board of Directors of the Fewa; board members, representatives of the General Directorate of Residency and Foreigners Affairs; representatives of the Dubai Police General Headquarters, as well as a number of media professionals. Al Mazrouei delivered a keynote, in which he congratulated the winners and urged others to constantly work hard and aspire to achieve excellence in government services. He also pointed out that these efforts strengthen the UAE’s position among the world's most developed and distinguished countries in providing government services to the people. He highlighted that the number of participants in the awards has increased over the past four editions, from 33 employees in 2014, to 54 in 2015, 79 in 2016, and over to 103 in 2017. He noted that this increase reflects the confidence in the awards and the position they occupy in institutional culture. To assure impartial assessment, external assessors were employed to aid the internal assessment team of 17 highly qualified assessors. The process was also supported by a specialised jury of excellence experts from the General Directorate of Residency and Foreigners Affairs and Dubai Police General Headquarters. The goal, according to Al Mazrouei, was to present the awards in accordance with highest standards of institutional and professional excellence. The awards are based on a wide variety of criteria, including performance, achievement, initiative, innovation, education, and supervision.




Iraq Wants Kurdish Kar Group to Halt Operations in Kirkuk Bloomberg - Khalid Al Ansary

Iraq’s parliament wants the Kurdish Kar Group to halt work at its oil operations in the disputed northern region of Kirkuk, which the central government reclaimed from the OPEC country’s semi-autonomous Kurdish authorities in October.

Parliament voted to ask the Oil Ministry to stop Kar from operating in Kirkuk fields, Ali Muarej, a member of the parliament’s oil and gas committee, said Monday by phone. In October, Iraq’s North Oil Co. was working with Kar to resume pumping at Bai Hassan and Avana oil fields in Kirkuk that had halted output on Oct. 16 due to fighting between the semi-autonomous Kurds in the north and the central government in Baghdad. Kar and North Oil weren’t immediately available for comment.

Iraqi forces took control of oil fields around Kirkuk in October, which the Kurds had held since 2014, when they fought to protect the area from the onslaught of Islamic State militants. Bai Hassan and Avana had been pumping about 275,000 barrels of oil a day before the Iraq government troops recaptured them. The fighting was sparked after the Kurdish region held an independence referendum, which the federal government rejected. Kar also operates the crude pipeline that exports crude from the Kurdish region to Turkey.

Iraq has “very ambitious” plans to rehabilitate the fields around Kirkuk, Oil Minister Jabbar al-Luaibi told reporters in Vienna in November. Iraq pumps most of its 4.42 million barrels a day from fields in the south and ships it from the Persian Gulf port of Basra. The country is the second-biggest producer of the Organization of Petroleum Exporting Countries.




Iran Oil Ship still burning, at Risk of Sinking as Buyer Seeks Other Supply Bloomberg - Heesu Lee

Hanwha Total Petrochemical Co. bought alternative supply after a fire on board an Iranian oil tanker that was destined for the South Korean company. Crew members of the vessel were still missing following a collision in the East China Sea with another ship that’s left it in danger of sinking.

The Sanchi is still ablaze and may explode after colliding on Saturday with the bulk carrier CF Crystal about 160 nautical miles off the coast of Shanghai, Chinese state media reported, with images showing the ship shrouded in thick black smoke. China, South Korea and the U.S. sent vessels and planes to search for Sanchi’s missing crew -- 30 Iranians and two Bangladeshis, the Associated Press reported.

One of the 32 missing sailors was found dead, Tasnim News Agency reported, citing Mohammad Rastad, the head of Iran’s Ports and Maritime Organization. The ship was throwing off poisonous gases, hindering rescue efforts, Tasnim said, citing Sirous Kian-Ersi, managing director of National Iranian Tanker Co.

Sanchi was ferrying 1 million barrels of condensate -- a hydrocarbon liquid that’s used to make petrochemicals -- to Daesan, according to a Hanwha Total spokesman. The firm plans to use its stockpiles as a replacement for the supply, and is considering whether to make additional purchases, he said, asking not to be identified because of internal policy.

Hanwha on Monday also issued a tender and bought five 25,000-metric-ton cargoes of naphtha -- another feedstock involved in petrochemical production -- for delivery next month, paying a premium of about $10 a ton over benchmark prices for four of the shipments. It didn’t issue




tenders to buy a similar grade of the oil product for delivery in January, according to data compiled by Bloomberg.

Hanwha Total purchased a total of about 64 million barrels of condensate in the January-November period last year, of which 39.4 million barrels came from Iran, according to the state-run Korea National Oil Corp. data compiled by Bloomberg.

Compensation Claim

The Panama-flagged Sanchi is owned by state-run NITC and departed Assaluyeh port on Dec. 16 for Daesan, according to data compiled by Bloomberg. All aboard the CF Crystal, a Hong Kong-registered cargo vessel that was carrying grain from the U.S. to China, were rescued, according to China’s Ministry of Transport, which said oil was on the water.

Hanwha plans to claim compensation for the cargo’s loss under its own insurance program, according to the South Korean company’s spokesman.

The Sanchi has full protection and indemnity insurance through the Steamship Mutual P&I club, according to its executive chairman Gary Rynsard. The incident is being treated as a “normal casualty” although it is too early to assess the size of any possible claim, he added. The cover spans oil pollution, damage, collision, death and and injury to the crew.

Iran, the third-largest oil producer in the Organization of Petroleum Exporting Countries, sells most of its crude and condensate to Asia, exporting about 2 million barrels a day. Condensate is a light oil produced along with natural gas, mainly at Iran’s offshore South Pars fields. The port of Assaluyeh is the main loading point for Iranian condensate.




Netherlands: Dutch plan to build the world's biggest wind farm Leanna Garfield Business Insider

If all goes according to plan, the farm will deliver 30 gigawatts of power to the Netherlands, United Kingdom, and later Belgium, Germany and Denmark,The Netherlands has a highly ambitious renewable-energy plan in the works.

The country hopes to build the world's largest offshore wind farm by 2027, along with a 2.3-square-mile artificial island to support it.

As The Guardian notes, the farm would sit at Dogger Bank, a windy and shallow site 78 miles off the East Yorkshire coast. It would deliver power to the Netherlands, United Kingdom, and later Belgium, Germany, and Denmark.

Offshore wind farms typically use expensive underwater cables that convert the turbines' electric current into a type that electricity grids can use. TenneT's island, however, would house equipment that would perform this conversion on-site, thereby allowing the farm to send electricity directly to the UK and Netherlands via less pricey cables.

According to TenneT, the Dutch electric company spearheading the project, putting additional equipment on the island would also allow the team to operate more turbines at a lower cost — and thus generate more power — than a traditional offshore wind farm.




Though the cost of offshore wind power is often higher than onshore (without subsidies), the approach can be advantageous, since winds tend to blow harder and more consistently in the ocean.

The Dutch wind farm would be capable of producing 30 gigawatts of power — more than double the amount of offshore wind power installed across Europe today.

The London Array, which can produce 630 megawatts of power over 47 square miles, is currently the largest offshore wind farm in the world.

The world's largest onshore wind farm, China's Gansu Wind Farm, could generate over 6,000 megawatts (6 gigawatts) as of 2012 (the most recent data available), and has a goal of 20,000 megawatts (20 gigawatts) by 2020. However, according to a 2017 report from The New York Times, a number of Gansu's turbines are still sitting idle.

The potential for offshore wind energy in the US is massive. If the country were to build turbines in all of its available ocean space, the winds above coastal waters could provide more than 4,000 gigawatts per year. That's more than four times the nation’s current annual generation capacity.

Several American offshore wind projects are underway. North America's first offshore wind farm, called the Block Island Wind Farm, started delivering power to the New England grid in May 2017, and effectively helped shut down a diesel plant that previously provided electricity to Rhode Island. In 2018, Deepwater Wind also plans to install 15 turbines approximately 30 miles east of Montauk, New York.




World: Oil shipping rate a Big Victim From OPEC's Oil Cuts Bloomberg + NewBase

OPEC’s strategy to end a worldwide crude glut is causing havoc for a vital link in the oil industry’s supply chain: the fleet of supertankers that shuttle fuel between continents.

The ships’ average earnings plunged last year by more than half to levels not seen since 2009 and far below what shipping analysts had been predicting. Now, the producer group’s extension of output cuts throughout 2018 is adding to the downturn.

“These cuts reduced the number of cargoes from the Middle East to Asia significantly at a time when a large amount of newly-built vessels are being delivered,” Olivier Jakob, managing director at Petromatrix GmbH in Zug, Switzerland, said in a phone interview.

Oil supertankers, known in the industry as very large crude carriers, or VLCCs, can measure a quarter of a mile in length and haul about 2 million barrels of crude. Since the beginning of 2017, the Organization of Petroleum Exporting Countries and its allies have sought to reduce oil production by almost 1.8 million barrels a day, curbing exports and business for tankers on key trade routes. The group in June plans to revisit the cuts, which currently run through the end of the year.

Crude exports from OPEC’s Persian Gulf members last month dropped below 18 million barrels a day for the first time since August, tanker-tracking data compiled by Bloomberg show. In particular, observed shipments declined to China and Japan from Saudi Arabia, Iran and the United Arab Emirates.

Meanwhile, the global supertanker fleet is expected to expand by 4 percent this year, after growing 5.3 percent last year and 7.4 percent in 2016, Clarkson Research Services Ltd. estimates. Shipping rates have tumbled in recent months, a time of year when they often strengthen.




“If OPEC lifts the output cut in its revision in June, the rates would improve as more oil will be pumped to the market,” said Jakob. “But if it doesn’t then the rates would suffer the whole year.”

Rate Rout

Earnings for the vessels slumped by 57 percent to $17,794 a day on average last year, the lowest since at least 2009, Clarkson data show. Analysts surveyed by Bloomberg had anticipated an average of $25,000 a day for 2017.

Oil prices and tanker earnings often move in opposite directions. In 2013, a year when Brent crude reached almost $120 a barrel, supertankers earned an average $18,621 a day, according to Clarkson. Two years later, amid the oil-price slump, daily returns jumped to an average $64,846.

Since June, Brent futures have soared 51 percent to the highest level in more than three years, trading around $68 a barrel. Earnings on a key supertanker route from the Persian Gulf to Asia plummeted 69 percent in 2017 to end the year at about $16,000 a day, well below the December seasonal average, Baltic Exchange data show.

The rate rout has affected some of the world’s largest tanker companies. Shares of Bermuda-based DHT Holdings Inc. declined to a 2017-low of $3.55 on Dec. 20, though they have risen slightly in recent days. Frontline Ltd.’s shares dropped 39 percent last year.

Click here for story on looming fuel rules for tankers and other vessels

Fleet growth and inventory drawdowns, which reduce the amount of fuel for export, are “the dominant reason for the weak tanker market we have experienced during the last 12 months,” Robert Hvide Macleod, chief executive officer of Frontline’s management business, said by email. The OPEC cuts have been offset by an increase in trade flows elsewhere, including the Atlantic Basin and from the U.S. to Asia, he said.

Amid the market turbulence, Antwerp-based Euronav NV on Dec. 21 said it would acquire Gener8 Maritime Inc. of New York, creating an independent tanker operator with a fleet of 75 crude tankers, including 44 VLCCs. Euronav declined to comment because the transaction hasn’t been completed yet. A Gener8 Maritime spokesman didn’t immediately respond to a request for comment.

‘Double Whammy’

“The crude tanker market has a double whammy: reduced OPEC exports and too many new ships,” said Burak Cetinok, head of research at Arrow Shipbroking Group in London. “We expect volatility in the rates this year but overall a challenging market.”

In addition, crude is now trading in a structure called backwardation, when near-term contracts are at a premium to later-dated ones, an indication that the market is re-balancing and the attraction of storing oil -- particularly at sea -- is diminishing.

“That frees the ships tied-up for storing oil, adding to the vessel glut,” Petromatrix’s Jakob said.

The second half of this year may provide a turning point for supertankers as demand for OPEC crude increases and fleet growth slows, according to shipping analyst Eirik Haavaldsen at investment bank Pareto Securities AS.

“The first half will be weak though, and probably weaker than the first half of 2017,” he said.




NewBase January 09 - 2018 Khaled Al Awadi

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

Oil prices hit highest since 2015, but doubts loom over rally Reuters + Bloomberg + NewBase

U.S. oil prices hit their highest since 2015 again on Tuesday as speculators bet on further price rises amid OPEC-led production cuts and a dip in American drilling activity, though some warned the rally could run out of steam.

U.S. West Texas Intermediate (WTI) crude futures were at $62.16 a barrel at 0751 GMT - 43 cents, or 0.7 percent, above their last settlement. They earlier matched a May-2015 high of $62.56 a barrel.

Beyond equaling that 2015 high, which was a short intra-day spike, Tuesday’s peak was the strongest level for WTI since December, 2014, at the start of the oil market slump.

Brent crude futures were at $68.11 a barrel, 33 cents, or 0.5 percent, above their last close. Brent touched $68.27 last week, its highest since May, 2015.

Traders said prices were mainly being driven by speculative money being poured into crude futures on the notion of a tighter market following a year of production cuts led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia, which are set to last through 2018.

Oil price special

coverage




“Speculators continued to increase their net long in ICE Brent ... According to exchange data, speculators increased their position by 4,175 lots to leave them with a record net long of 565,459 lots,” ING bank said.

A slight dip in the amount of rigs in the United States drilling for new oil was supporting WTI, traders said. The number of rigs drilling for oil fell by 5 to 742 in the week to Jan. 5, according to oil services firm Baker Hughes.

GETTING AHEAD?

Despite the recent bull run, which has lifted crude prices by more than 10 percent since early December, some warn that markets are getting ahead of themselves.

The U.S. rig-count remains significantly above the low of 316 in June, 2016, and U.S. crude output is expected to break through 10 million barrels per day (bpd) soon, hitting a level that only Russia and Saudi Arabia have achieved so far.

“U.S. crude oil production is still increasing, so surely this evidences that the system is, once again, becoming even more efficient,” said Matt Stanley, a fuel broker with Freight Investor Services (FIS) in Dubai.

In Asia, the world’s biggest oil consuming region, there were also signs that despite the cuts in crude production, fuel supplies remain ample. Enjoying good profit-margins in 2017, Asian refiners had cranked up processing to a record 23 million bpd by last October.

With profits, known in the oil industry as cracks, now down due to higher feedstock crude prices and ample fuel supplies because of last year’s processing binge, Asian refiners have started to reduce output, likely resulting in lower crude orders.




“Falling crude throughput will bring downward price pressure in Q1/Q2, as seasonally softening consumption, narrowing distillate cracks and spring maintenance lower run rates,” BMI Research said in a note.

WTI Oil Prices Toys With $62 Amid Iranian Friction, U.S. Drilling Pullback

Oil rose, clinging to last week’s gains as political tensions in Iran and declining exploration work in the U.S. threatened output growth.

Futures advanced 0.5 percent on Monday, settling near $62-a-barrel in New York. A simmering power struggle in Iran has raised anxieties over the stability of OPEC’s third-largest crude producer. Meanwhile, U.S. explorers cut the number of rigs searching for oil last week by the biggest margin in two months.

The Iran situation “has the market a bit on edge,” said John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund.

Oil has held above $60 a barrel since late December in New York with U.S. crude stockpiles contracting and American oil drilling stalling out. Output curbs by the Organization of Petroleum Exporting Countries and allied suppliers have buoyed prices, with producers promising to continue the curbs for all of 2018.

“The risk at this point is somewhat to the upside, particularly if we continue to see weak drilling numbers in the United States,” Bart Melek, head of global commodity strategy at TD Securities in Toronto, said by telephone. Yet at current prices levels, “a significant portion of shale production is viable and profitable.”

West Texas Intermediate for February delivery added 29 cents to settle at $61.73 a barrel on the New York Mercantile Exchange. Total volume traded was about 8 percent below the 100-day average. Brent for March settlement climbed 16 cents to end the session at $67.78 a barrel on the London-based ICE Futures Europe exchange. The global benchmark crude traded at a premium of $6.06 to March WTI.




NewBase Special Coverage

News Agencies News Release January 09-2017

Batteries perform many different functions on the power grid Source: U.S. Energy Information Administration, Form EIA-860M, Preliminary Monthly Electric Generator Inventory

Driven largely by installations over the past three years, the electric power industry has installed about 700 megawatts (MW) of utility-scale batteries on the U.S. electric grid. As of October 2017, these batteries made up about 0.06% of U.S. utility-scale generating capacity. Another 22 MW of batteries are planned for the last two months of 2017, with 69 MW more planned for 2018.

Note: 2017 includes reported installations for January–October and planned installations for November–December.

New energy storage information available in the 2016 edition of EIA’s Annual Electric Generator Report provides more detail on battery capacity, charge and discharge rates, storage technology types, reactive power ratings, storage enclosure types, and expected usage applications.

Batteries, like other energy storage technologies, can serve as both energy suppliers and consumers at different times, creating an unusual combination of cost and revenue streams and making direct comparisons to other generation technologies challenging.

The decision to build a new power plant depends in part on its initial construction costs and ongoing operating costs. Although battery projects have a relatively low average construction cost, they are not stand-alone generation sources and must buy electricity supplied by other generators




to charge and cover the round-trip efficiency losses experienced during cycles of charging and discharging.

Battery costs also depend on technical characteristics such as generating capability, which for energy storage systems can be described in two ways:

• Power capacity or rating. Measured in megawatts, this is the maximum instantaneous amount of power that can be produced on a continuous basis and is the usual type of generator capacity discussed

• Energy capacity. Measured in megawatthours (MWh), this is the total amount of energy that can be stored or discharged by the battery

A battery’s duration is the ratio of its energy capacity to its power capacity. For instance, a battery with a 2 MWh energy capacity and 1 MW power capacity can produce at its maximum power capacity for 2 hours. Actual operation of batteries can vary widely from these specifications. Batteries discharged at lower-than-maximum rates will yield longer duration times and possibly more energy capacity.

Short-duration batteries are designed to provide power for a very short time, usually on the order of minutes to an hour, and are generally less expensive per MW to build. Long-duration batteries can provide power for several hours and are more expensive per MW.

On the revenue side, batteries have relatively low capacity factors because of charging durations and cycling limitations for optimal performance. Nevertheless, they can uniquely capture a range of value streams, which can sometimes be combined to improve project economics. Some of the uses for batteries include:

• Balancing grid supply and demand. Batteries can help balance electricity supply and demand on multiple time scales (by the second, minute, or hour). Fast-ramping batteries are particularly well suited to provide ancillary grid services such as frequency regulation, which helps maintain the grid’s electric frequency on a second-to-second basis.

• Peak shaving and price arbitrage opportunities. By buying power and charging during lower-price (or negative-price) periods and selling power and discharging during higher-price periods, batteries can flatten daily load or net load shapes. Shifting portions of electricity demand from peak hours to other times of day also reduces the amount of higher-cost, seldom-used generation capacity needed to be online, which can result in overall lower wholesale electricity prices.

• Storing and smoothing renewable generation. Storing excess solar- and wind-generated electricity and supplying it back to the grid or to local loads when needed can reduce renewable curtailments, negative wholesale power prices coincident with wind and solar over-generation, and price spikes related to evening peak ramping needs. Co-locating batteries with solar and wind generators allows system owners to more predictably manage the power supplied to the grid by combined renewable-generator-and-battery systems.

• Deferring large infrastructure investments. Local pockets of growing electricity demand sometimes require electric utilities to build expensive new grid infrastructure such as upgraded substations or additional distribution lines to handle the higher demand, which can cost upwards of tens of millions of dollars. Installing batteries at strategic locations, at




a much lower cost, enables utilities to manage growing demand while deferring large grid investments.

• Reducing end-use consumer demand charges. Large power consumers such as commercial and industrial facilities can reduce their electricity demand charges, which are generally based on the facilities’ highest observed rates of electricity consumption during peak periods, by using on-site energy storage during peak demand times.

• Back-up power. Batteries can provide back-up power to households, businesses, and distribution grids during outages or to support electric reliability. As part of an advanced microgrid setup, batteries can help keep power flowing when the microgrid is islanded, or temporarily electrically separated, from the rest of the grid.

Source: U.S. Energy Information Administration, Form EIA-860M, Preliminary Monthly Electric Generator Inventory




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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 28 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.

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NewBase January 2018 K. Al Awadi







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