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New base special 15 october 2014
- 1. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
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NewBase 15 October 2014 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Dubai Petroleum hits gas in offshore field
Gulf News + NewBase
Dubai Petroleum Establishment, (DPE) has said that it has identified significant volumes of gas in
its T-02 deep gas exploration well.
The high pressure and high temperature T-02 well was drilled to 18,248 feet (5,562 metres) into
the Pre Khuff formation and is the deepest well in Dubai to date, the company said in a statement.
“The well is in the offshore Fateh field where oil and gas was first discovered at depths of around
10,000 feet in 1996. While drilling in the Pre Khuff, formation gas flowed into the T-02 well bore on
a number of occasions. Current indications are that the gas is largely methane with no H2S
content,” the company said.
Dubai
Fateh field facilities
- 2. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 2
An earlier well, T-01, was drilled in to the Khuff formation in 1981 to a depth of 17,397 feet but test
results indicated that significant levels of H2S and nitrogen were present which made gas
production and treatment difficult and expensive in an offshore environment, the company said.
The new well has been wireline logged to evaluate the potential of the formations and there are
some 390 feet of gas rich zones out of the 900 feet drilled and logged in the Pre Khuff. The
company added that the well is currently being suspended to allow for later re-entry, stimulation
and long term production testing. Until the testing program has been completed, potential reserves
and possible production rates cannot be estimated accurately.
“The planned production testing procedures require the use of specialist items and equipment that
have long lead times of delivery.” Currently DPE expects to have the test results in late summer
2015. DPE is 100 per cent owned by the Government of Dubai and responsible for Dubai’s
offshore oil and gas development and production. An oil and gas expert said that the discovery of
gas is a significant development.
“It is very exciting what they have discovered. Methane can be used in gas turbines in generating
power and also to run taxis and trucks. Dubai can now have domestic supply of gas. They need
not import it from outside,” said Tommy Amstrup Laursen, executive director of Ramboll oil and
gas Middle East, an engineering consultancy based in Doha.
He said the new discovery will also support the economic development of Dubai. Francisco
Quintana, head of economic research at Asiya Investments, which has offices in Dubai and
Kuwait said that Dubai is an energy importer, and it uses mostly gas to produce electricity.
“It has been importing LNG for a few years. If this well comes into production, it would help
reducing the energy bill, but unless this proves to be a massive deposit, it is unlikely that this new
source of gas will be able to change the long term trend,” he said. He said natural gas prices are
likely to stabilize or decrease in the next decade, given the abundant new supplies.
“That should reduce pressure on Dubai’s public finances.”
Dubai Supply - DUSUP completes first Gas-Up Cool Down operation
(WAM) + NewBase
Dubai Supply Authority, DUSUP, has completed its first Gas Up and Cool Down operation in
Dubai on the LNG regasification vessel EXPLORER in Dubai waters using the DUSUP Chartered
Multi-gas Vessel NORGAS UNIKUM.
This is the first time that this service has been provided using a small LNG carrier and sets a
platform for providing a wider range of LNG services in Dubai including LNG break bulking and
LNG Bunkering.
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The operation allows a more efficient use of the Dubai LNG Terminal in Jebel Ali by off-loading
LNG onto a smaller LNG carrier providing wider services tailored to customer’s requirements.
DUSUP has been working in partnership with IM Skaugen (incorporating SPT and Norgas
Carriers) to develop LNG Gas Up and Cool Down services using Norgas Multi-gas Vessels.
DUSUP will provide the LNG and be the counter-party for all prospective customers.
IM Skaugen will act as the service provider with SPT performing the STS operations and Norgas
Carriers managing the fleet of Multi-Gas vessels that are being used to deliver the service. An
agreement between the two companies was completed earlier in 2014 following detailed technical
and HESQ studies for the transfer operations to the smaller LNG carriers.
"The completion of this gas up and cool down operation is an important first step in the
development of LNG services in Dubai" said Abdulla Abdul Karim, General Manager of DUSUP.
"DUSUP is putting in place the LNG facilities necessary to support the growth of Dubai’s Port and
Dry-Docking activities."
DUSUP was founded under decree in1992 with the sole authority to buy, store, distribute and sell
natural gas within Dubai. Since 2010, DUSUP has been importing and re-gasifying LNG at its
Jebel Ali Terminal and has imported LNG to Dubai from every continent across the globe.
LNG Vessel with wave
breaker connected to
on shore pipeline
network via sub-sea
line
- 4. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
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in this publication. However, no warranty is given to the accuracy of its content . Page 4
- 5. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 5
Mideast big refineries crank up diesel output
Reuters+ NewBase
A rapid rise in Middle East refining capacity will create a large glut of diesel as global demand
growth for the road fuel weakens, the International Energy Agency (IEA) said on Tuesday. In its
monthly report, the IEA forecast that the Middle East's net oil product exports will reach nearly 1
million barrels per day (bpd) in 2015 from an average of less than 400,000 bpd in 2013.Newly built
Middle Eastern mega refineries are coming into production just as demand growth for their core
product - diesel - is beginning to fade, which could leave them searching for outlets, the IEA said.
"The configuration of the plants, designed to maximize diesel production, seems somewhat at
odds with market trends that in recent months have shown stronger demand growth for gasoline
and jet fuel than for middle distillates," the agency said in its Oil Market Report.
The IEA expects ultra low-sulfur diesel and jet fuel production from two newly built Saudi refineries
and one in the UAE alone to reach 800,000 bpd, against regional distillate demand growth of less
than 100,000 bpd per year in 2014 and 2015. "The current economic and oil demand picture is
quite different from what was envisaged at the time when they got underway in the mid-2000s,"
the report said. "Since the financial crisis of 2008-09, the economic slowdown has had a more
marked impact on distillate demand than on that for other products, such as gasoline."
The 400,000 bpd Jubail refinery, a joint venture between Saudi Aramco and France's Total,
reached full production in August and the 400,000 bpd Yanbu refinery, run with China's Sinopec,
is set to start in early 2015. The 420,000 bpd Ruwais refinery in the UAE is targeting an end-of-
year start-up.
But sputtering growth in key growing markets, such as India, Brazil and other Latin American
countries, is limiting outlets for diesel, while subsidy cuts in those countries also threatens
consumption. After India phased in gradual subsidy cuts, demand reversed annual growth that
had characterized its distillates markets from the 1970s, and demand shrank from June 2013 until
April 2014. Brent crude fell $2.72 a barrel to $86.17, its weakest point since December 2010,
before recovering slightly to around $86.40. US crude was down $1.75 a barrel to $83.99. Even
Europe, which is net short of ultra low-sulfur diesel now, and set to become more reliant on
imports as regional refineries shut down and cut production, is not the boom market that refineries
hoped for.
- 6. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 6
Rosneft, CNPC strengthen cooperation
Press Release, October 14, 2014; Image: government.ru
The agreement envisages elaboration of current and potential strategic cooperation areas.
“The document also foresees the fueling of a deeper collaboration in these areas. In particular,
the parties intend to proceed with Upstream projects in the Russia, refinining in China (Tianjin
Refinery) and other venues of cooperation,” Rosneft said in a statement.
“The parties intend to apply joint efforts with the scope of further expansion of strategic
cooperation, including in the areas of the development of liquefied natural gas projects which
embraces potential Russian LNG supplies to China,” the company added.
Rosneft and ChineseNationalPetroleumCorporation(CNPC)signed anagreementforthe extensionsofstrategic
cooperation.
- 7. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 7
Gazprom, CNPC ink technical agreement on gas supplies via eastern route
Press Release, October 14, 2014; Image: Gazprom
It is a supplement to the purchase and sale agreement on natural gas supplies via the eastern
route, Gazprom said in a statement.
The technical agreement defines basic parameters of design, construction and operation of the
Power of Siberia gas trunkline’s cross-border section.
In addition, the document contains the main technical and technological features of conveying gas
from seller to buyer, according to the statement.
Gazprom and CNPC signed in May a deal for the Russian gas supply via the eastern route. The 30-
year contract provides for Russian gas supplies to China in the amount of 38 billion cubic meters
per year.
Gazprom’s AlexeyMiller and WangDongjin,VicePresidentofCNPC,signed atechnicalagreementinMoscow.
- 8. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 8
Pakistan: PPL announces fourth discovery in Gambat South
Source: PPL
Pakistan Petroleum Limited (PPL), operator ofGambat South Block, with 65 percent working
interest (WI) along with its joint venture partners Government Holdings (Private)
Limited and Asia Resources Oil Limited with 25 percent and 10 percent WI, respectively,
announced another gas-condensate discovery from exploratory well Kinza X-1 in District
Sanghar, Sindh. This is the fourth discovery in the block after Wafiq, Shahdad and Sharf gas-
condensate discoveries.
Exploration well Kinza X-1 was spud on July 28, 2014 and reached the final depth of 3695
meters on September 13, 2014. Based on wire line logs, potential hydrocarbon bearing zones
were identified in the Massive Sand of Lower Goru Formation, which are under testing. Initial
testing flowed 12 MMscfd gas along with condensate at 48/64” choke size, thereby confirming
the presence of commercial quantities of natural gas and condensate at Kinza X-1. The expected
output from the well will translate into approx. 2100 barrels per day in oil equivalent and foreign
exchange saving of USD 200,000 per day.
However, the well is being flowed at different choke sizes to measure gas flow rates and the
actual flow potential will be determined after completion of the test.
- 9. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 9
Thailand: Eco Orient Energy and Carnarvon drilling appraisal well in L44/43,
Source: Carnarvon Petroleum
Carnarvon Petroleum has advised that drilling has recommenced with the spudding of
the WBEXT-10B well, which is targeting the igneous reservoir down- dip of theWBEXT-3C,3D
and 3E wells in the L44/43 and L33/43Concessions in Thailand, in which Carnarvon holds a
20% interest. The Operator is expected to take around three weeks to complete the drilling of the
first well.
Further wells scheduled for drilling in this current campaign are;
• a follow-up well to the successful 2010 well WBEXT-1C, which produced over 250,000 Bl oil,
• an appraisal well to determine the extent of the oil column in the WBEXT-3ST1 fault block,
• development wells depending on the results of WBEXT-10B and
• an exploration well to the south of the WBEXT area.
Previously planned drilling in the L33/43 Concession has been delayed due to wet weather.
Production rates have been steady at around 4,000 bopd gross (800 bopd net to Carnarvon).
Equity holders in the L33/43 and L44/43 Concessions are:Carnarvon Petroleum 20%; Eco
Orient Energy (Operator) 60%; Loyz Energy 20%.
Highlights
• Drilling recommences onshore Thailand
• First well is WBEXT-10B, an appraisal well targeting igneous reservoir in the L44/43
concession
• Further wells are planned in the WBEXT production area
• Final campaign for 2014 has five wells scheduled Production in Thailand remains steady
around 4,000 bopd gross
- 10. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 10
Tanzania: Solo Oil announces acquisition of an interest in the Kiliwani
North gas field. Source: Solo Oi
Solo Oil has announced that it has signed binding heads of agreement to acquire an initial 6.5%
interest in the soon to be producing Kiliwani North Development License ('KNDL') in Tanzania
from Ndovu Resources, a wholly-owned subsidiary of Aminex, for a total consideration of
US$3.5 million ('Initial Acquisition'). Solo also has a 45 day option to increase its interest in the
KNDL by a further 6.5% to
13% ('Second
Acquisition').
The KNDL contains
the Kiliwani North 1
('KN1') well which is
expected to produce at an
approximate rate of 20
million cubic feet per day
('mmscfd') (equivalent to
more than 3,000 barrels of
oil per day) in first half
2015. This agreement,
when closed, will
represent a major
landmark for Solo as it will
give the Company its first
revenue from Tanzania.
Independently verified
gross in-place unrisked
mean gas resources of the
well, computed by Isis
Petroleum Consultants,
are estimated as 45 billion
cubic feet ("bcf").
Construction of the 2
kilometre long pipeline
from KN1 to the new
Songo Songo gas
processing plant has now
commenced and is
expected to be completed
in early 2015.
The Songo Songo gas
processing plant is connected with the newly constructed 36-inch gas pipeline from Mtwara in the
south of Tanzania to Dar es Salaam, the national capital, in the north, and this provides an
immediate route to monetise the Kiliwani North gas production.
Ndovu (Aminex's nominated joint operator of KNDL together with the Tanzanian Petroleum
Development Corporation) is in advanced negotiations for a gas sales agreement with the
Tanzanian authorities and these negotiations are expected to be satisfactorily concluded in the
- 11. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 11
near future. Solo notes that the Tanzanian authorities have recently reached agreement with
another operator in the region.
Solo and Aminex are already
partners in the Ruvuma
Production Sharing Contract in
southern Tanzania, with
respectively 25% and 75%
working interests, and where
newly acquired seismic data has
extended the potential of
the Ntorya appraisal area. The
partners in Ruvuma have
recently announced an upgrade
of the mean gas in-place
estimate to 2.3 trillion cubic feet
('tcf') by combining the Ntorya
discovery with the
adjacent Likonde prospect.
Neil Ritson, the Company's
Executive Director,
commented:
'This acquisition significantly
increases Solo's exposure to the
rapidly developing Tanzanian gas
sector and will provide valuable
revenue for many years from the
soon to be commissioned
Kiliwani Gas Field on Songo
Songo Island. Solo and Aminex
are continuing to work together to commercialise the exciting multi-tcf Ntorya discovery and
participation in Kiliwani North provides valuable near-term revenue and insights into the
Tanzanian gas market.'
The key terms of the proposed KNDL acquisition are set out below:
1.The Initial Acquisition will consist of a cash payment of US$3.5 million for 10% of Aminex's
65% interest in KNDL, representing a 6.5% interest in the entire KNDL, payable as a refundable
deposit of US$250,000 within 7 days of 13 October 2014, with the balance of US$3.25 million
becoming payable upon completion of the formal acquisition agreement.
Completion of the Initial Acquisition is subject to (1) confirmation of waiver of pre-emptive rights
by various joint venture partners, and (2) receipt of written approval from the Tanzanian
authorities to the assignment, each being satisfied within 45 days of 13 October 2014.
The parties have agreed to enter into a formal acquisition agreement within 30 days of 13
October 2014.
2.The Second Acquisition will consist of an option by Solo to acquire a further 10% of Aminex's
65% interest in KNDL (a further 6.5% interest in the entire KNDL) on the same terms as the Initial
Acquisition. This option will be exercisable within 45 days of 13 October 2014.
- 12. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 12
Statoil, Exxon make new gas discovery offshore Tanzania
Source : Statoil + NewBase
Norway’s Statoil and its US-based partner Exxon Mobil today announced that the
Giligiliani-1 exploration well has resulted in a new natural gas discovery offshore Tanzania.
The discovery of an additional 1.2 trillion cubic feet (tcf*) of natural gas in place in the Giligiliani-1
well brings the total of in-place volumes up to approximately 21 tcf in block 2.
The Giligiliani-1 discovery is located along the western side of block 2 at a 2,500-metre water
depth. The new gas discovery was made in Upper Cretaceous sandstones.
“This discovery has proven the gas play extends into the western part of block 2, which opens
additional prospects. Our success rate in Tanzania has been high and opening up a new area will
be key to continuing our successful multi-well programme,” said Nick Maden, senior vice president
for Statoil’s exploration activities in the Western Hemisphere.
The drillship Discoverer Americas will now drill the Kungamanga prospect located in the central
part of block 2. The Giligiliani-1 discovery is the venture’s seventh discovery in block 2. It is
preceded by the five high-impact gas discoveries Zafarani-1, Lavani-1, Tangawizi-1, Mronge-1
and Piri-1, and a discovery in Lavani-2.
Statoil operates the licence on block 2 on behalf of Tanzania Petroleum Development Corporation
(TPDC) and has a 65% working interest. ExxonMobil Exploration and Production Tanzania Limited
holds the remaining 35%. Statoil has been in Tanzania since 2007, when it was awarded the
operatorship for block 2.
- 13. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 13
Lundin hits both oil and gas in Alta well
Lundin Pet. + NewBase
Lundin Petroleum AB has announced that drilling of exploration well 7220/11-1 on the Alta
prospect in the Barents Sea has been successfully completed and has encountered both oil and
gas.
The well is located 20 km northeast of the Gohta discovery (well 7120/1-3) and some 160 km from
the Norwegian coastline. The main objective of well 7220/11-1 was to prove the presence of
hydrocarbons in reservoir rocks of Permo- Carboniferous and Triassic age. The well encountered
a gross hydrocarbon column of 57 metres consisting of 11 metres gas and 46 metres oil in
carbonate rocks of good reservoir quality.
Extensive data acquisition and sampling was carried out in the reservoir, including conventional
coring and fluid sampling. Two production tests (DSTs) were performed in the oil zone, producing
at a maximum rate of 3,260 barrels of oil per day and 1.7 million cubic feet of gas per day (MMcfd)
through a 36/64″ choke constrained by rig facilities. The gas/oil ratio was 94 Sm3/Sm3.
Following the results of well 7220/11-1 the preliminary evaluation of the gross recoverable oil and
gas resource range in the Alta accumulation is estimated at 125 to 400 million barrels of oil
equivalent (MMboe). The oil resource range is estimated at 85 to 310 million barrels of oil
(MMbbls).
Ashley Heppenstall, President and CEO, said: “The Alta discovery is a significant predominantly
oil discovery in the southern Barents Sea. Alta is close to the nearby Gohta discovery made by
Lundin Petroleum just over a year ago. This discovery is another positive step in relation to
- 14. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 14
proving up sufficient resources in the Loppa High area of the Barents Sea to enable the
development of oil production infrastructure.
“We are very excited about this discovery and the potential in the Loppa High area where we are
likely to drill three or four appraisal/exploration wells in 2015. In licence PL609 we have identified
several multi hundred million barrel prospects on trend with Alta and Gohta. Our drilling successes
in the Barents Sea have been made possible by extensive preparatory work including
comprehensive environmental assessments and the mapping of sea bottom conditions. The
Loppa High area is impacted by the Gulf Stream and as such is ice free all year and far from the
maximum southern edge of the ice edge.”
The exploration well 7220/11-1 is the first well drilled in production license PL609 after it was
awarded in the 21st Concession Round in 2011. The well was drilled to a total depth of 2,221
metres below mean sea level in a water depth of 388 metres. With the Alta discovery the
remaining prospectivity on PL609 has been further de-risked.
The Neiden and Borselv prospects further north in PL609 are drill-ready and both of these
prospects have the potential to contain material prospective resources. The well was drilled using
the semi-submersible drilling rig Island Innovator. The drilling is being completed and the rig will
move to drill exploration well 25/10-12S targeting the Kopervik prospect in production license
PL625, in the Norwegian North Sea, where Lundin Norway is operator. Lundin Norway holds 40
percent interest in PL609. Partners are RWE Dea Norge AS and Idemitsu Petroleum Norge AS
with 30 percent each.
- 15. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 15
Oil price slump will only hit US shale oil under 60$/B : IEA
Reuters + NewBase
The vast majority of shale oil in the US is produced at costs far below the current price of crude,
the head of the west's energy watchdog said, which means US projects can withstand the market
slump squeezing other producers.
Brent oil stands at around $88 per barrel, down more than 23 per cent from the year's peak above
$115 in June, raising concern that some shale oil projects will become un-economical. However,
Maria van der Hoeven, executive director of the International Energy Agency (IEA) said only a tiny
minority of shale oil production would be affected by the slump in prices to near-four-year lows.
"Some 98 per cent of crude oil and condensates from the US have a breakeven price of below
$80 and 82 per cent had a breakeven price of $60 or lower," she told Reuters in an interview on
the sidelines of the launch of the Africa Energy Outlook publication.
Saudi Arabia is quietly telling oil market participants that Riyadh is comfortable with markedly
- 16. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 16
lower oil prices for an extended period, a sharp shift in policy that may be aimed at slowing the
expansion of rival producers including those in the US shale patch.
Some Opec members are clamouring for urgent output cuts to push global prices back up above
$100 a barrel as they rely heavily on oil exports to balance their budgets, but others like the
Saudis are thought to be more relaxed.
Van der Hoeven said the fall in the oil price would provide a welcome economic boost for
economies which are heavily reliant on oil imports. "We've noted more than once in the past years
the relatively high price of oil really places a burden on oil consumers. What we see now with
these much lower prices, for consumers it will be a welcome relief."
However, she added that it could make life more difficult for exporters who rely on income from oil
sales. "It's a benefit for the global economy but it might have some consequences," she said. "The
recent price drop will present some challenges for those producers who base budget assumptions
on oil prices above $100 per barrel."
The IEA's monthly Oil Market Report, which will give further insight into the agency's analysis of
the current demand outlook is due out on Tuesday.
- 17. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 17
WIND ENERGY IS CHEAPEST ENERGY, EU ANALYSIS FINDS
EVWIND, WIND ENERGY
Onshore wind energy is cheaper than coal, gas or nuclear energy when the costs of ‘external’ factors like
air quality, human toxicity and climate change are taken into account, according to an
The report says that for every megawatt hour (MW/h) of electricity generated, onshore wind
power costs roughly €105 (£83) per MW/h, compared to gas and coal which can cost up to around
€164 and €233 per MW/h, respectively.
Based on EWEA’s analysis of the data in the report, onshore wind has an approximate cost of
EUR 105 per megawatt hour (MWh) which is cheaper than gas (up to EUR 164), nuclear (EUR
133) and coal (between EUR 162-233). Offshore wind comes in at EUR 186 and solar PV has a
cost of around EUR 217 per MWh.
The total cost of energy production, which factors in externalities such as air quality, climate
change and human toxicity among others, shows that coal is more expensive than the highest
retail electricity price in the EU. The report puts the figure of external costs of the EU’s energy mix
in 2012 at between EUR 150 and EUR 310 billion.
Justin Wilkes, deputy chief executive officer of the European Wind Energy Association, said: “This
report highlights the true cost of Europe’s dependence on fossil fuels. Renewables are regularly
denigrated for being too expensive and a drain on the taxpayer. Not only does the Commission’s
report show the alarming cost of coal but it also presents onshore wind as both cheaper and more
environmentally-friendly.”
- 18. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained
in this publication. However, no warranty is given to the accuracy of its content . Page 18
Onshore and offshore wind technologies also have room for significant cost reduction. Coal on the
other hand is a fully mature technology and is unlikely to reduce costs any further.
He added: “We are heavily subsidising the dirtiest form of electricity generation while proponents
use coal’s supposed affordability as a justification for its continued use. The irony is that coal is
the most expensive form of energy in the European Union. This report shows that we should use
the 2030 climate and energy package as a foundation for increasing the use of wind energy in
Europe to improve our competitiveness, security and environment.”
Additional Graphics from the expert report :-
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- 19. Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
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Your partner in Energy Services
Khaled Malallah Al Awadi,
Energy Consultant
MSc. & BSc. Mechanical Engineering (HON), USA
ASME member since 1995
Emarat member since 1990
Mobile : +97150-4822502
khdmohd@hawkenergy.net
khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with a totalKhaled Al Awadi is a UAE National with a totalKhaled Al Awadi is a UAE National with a totalKhaled Al Awadi is a UAE National with a total
of 24 yearsof 24 yearsof 24 yearsof 24 years of experience in theof experience in theof experience in theof experience in the OiOiOiOil & Gasl & Gasl & Gasl & Gas
sector. Currently working as Technical Affairs Specialist forsector. Currently working as Technical Affairs Specialist forsector. Currently working as Technical Affairs Specialist forsector. Currently working as Technical Affairs Specialist for
Emirates General Petroleum Corp. “Emarat“ with externalEmirates General Petroleum Corp. “Emarat“ with externalEmirates General Petroleum Corp. “Emarat“ with externalEmirates General Petroleum Corp. “Emarat“ with external
voluntary Energy consultation for the GCC area via Hawkvoluntary Energy consultation for the GCC area via Hawkvoluntary Energy consultation for the GCC area via Hawkvoluntary Energy consultation for the GCC area via Hawk
Energy Service as a UAE operations base , Most of theEnergy Service as a UAE operations base , Most of theEnergy Service as a UAE operations base , Most of theEnergy Service as a UAE operations base , Most of the
experience wereexperience wereexperience wereexperience were spent as the Gas Operations Manager inspent as the Gas Operations Manager inspent as the Gas Operations Manager inspent as the Gas Operations Manager in
Emarat , responsible for Emarat Gas Pipeline Network FacilityEmarat , responsible for Emarat Gas Pipeline Network FacilityEmarat , responsible for Emarat Gas Pipeline Network FacilityEmarat , responsible for Emarat Gas Pipeline Network Facility
& gas compressor stations . Through the years , he has& gas compressor stations . Through the years , he has& gas compressor stations . Through the years , he has& gas compressor stations . Through the years , he has
developed great experiences in the designing & constructingdeveloped great experiences in the designing & constructingdeveloped great experiences in the designing & constructingdeveloped great experiences in the designing & constructing of gas pipelines, gas metering & reof gas pipelines, gas metering & reof gas pipelines, gas metering & reof gas pipelines, gas metering & regulating stations and in thegulating stations and in thegulating stations and in thegulating stations and in the
engineering of supply routes. Many years were spent drafting, & compiling gas transportation , operation & maintenanceengineering of supply routes. Many years were spent drafting, & compiling gas transportation , operation & maintenanceengineering of supply routes. Many years were spent drafting, & compiling gas transportation , operation & maintenanceengineering 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 &agreements along with many MOUs for the local authorities. He has become a reference for many of the Oil &agreements along with many MOUs for the local authorities. He has become a reference for many of the Oil &agreements along with many MOUs for the local authorities. He has become a reference for many of the Oil & GasGasGasGas
Conferences held in the UAE andConferences held in the UAE andConferences held in the UAE andConferences held in the UAE and Energy program broadcasted internationally , via GCC leading satellite Channels .Energy program broadcasted internationally , via GCC leading satellite Channels .Energy program broadcasted internationally , via GCC leading satellite Channels .Energy program broadcasted internationally , via GCC leading satellite Channels .
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NewBase 15 October 2014 K. Al Awadi