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Former Shell Scientist M. King Hubbert Speaks On Peak Oil in 1976
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What Happened To The $11 Oil?

"The chairman of Royal Dutch/Shell, Mark Moody-Stuart, three months ago unveiled a five-year plan that assumed a price of $14 a barrel. He has since publicly mused about oil at $11. Sir John Browne, chief executive of BP-Amoco, is now working on a similar assumption. Consumers everywhere will rejoice at the prospect of cheap, plentiful oil for the foreseeable future. Policymakers who remember the pain of responding to oil shocks in 1973 and in 1979-80 will also be pleased."
The next shock?
Economist, 4 March 1999

".... today's $11-a-barrel price [is].... [the] lowest inflation-adjusted oil prices of the past half-century ...   Even if consumption rises dramatically over time, most analysts believe prices should remain in check because of advanced technology and because OPEC nations need to sell as much as they can to maintain their incomes..... Low oil prices are excellent news, of course, for big energy consumers. A sustained $10-per-barrel drop in the price of oil cuts about 0.7 points from the annual U.S. inflation rate over five years and adds about 0.3 points to the U.S. economy's growth.... [I]f you're still operating under the assumption that the earth's petroleum--or at least the cheap stuff--is about to run out, you're not going to thrive in the new oil era. Technology is making it possible to find, produce, and refine oil so efficiently that its supply, at least for practical purposes, is basically unlimited."
TREMORS FROM CHEAP OIL
Businessweek, 14 December 1999


2017

"We're running out of new oil. Explorers in 2017 discovered the least amount of oil since at least the 1940s, according to Rystad Energy, an oil and gas consultancy. It estimated that less than seven billion barrels of oil equivalent were found this year through Thursday. Some energy companies will announce more discoveries next year in their 2017 annual reports, but Rystad expects this to increase the 2017 total by 10% at most. New discoveries have fallen every year since 2014, when oversupply triggered an oil crash that cut its price by more than half. The plunge forced many upstream oil producers to reduce their spending, and helps explain why discoveries are also down. But that's not the only reason: explorers are finding less oil resources per field, according to Rystad. An average offshore discovery held about 100 million barrels of oil equivalent (boe) in 2017, down from 150 million boe in 2012. The last time oil and gas companies added to their reserves by as much as they were producing was in 2006, when the so-called reserve replacement ratio reached 100%. It was down to 50% in 2012, and 11% in 2017. This doesn't mean we're about to run out of crude oil. Major producers including the US have emergency reserves. Moreover, the industry's headache for the past few years has been too much oil. The Organisation of Petroleum Exporting Countries, a cartel of big producers, has agreed to deal with the oversupply problem by cutting output until the end of 2018. Also, there are usually a few years in between when an oil firm makes a large discovery and when it's ready for production. That means we can count on recent discoveries to keep our engines running for some time. And there were some major discoveries this year, like the 1 billion barrels found off the coast of Mexico by Premier Oil, Talos Energy, and Sierra Oil & Gas. But if oil discoveries continue trending down, we could be talking seriously about oil shortages in about a decade from now, Rystad estimates.  "While there have been some notable successes this year, we have to face the fact that the low discovered volumes on global level represent a serious threat to the supply levels some ten years down the road," said Sonia Mladá Passos, a senior analyst at Rystad, in a press release."
Oil discoveries are at an all-time low — and the clock is ticking
Business Insider, 23 December 2017

2016

"The Permian Basin in West Texas may be the second biggest field in the world after Ghawar in Saudi Arabia,” he said. Zhu Min, the deputy director of the International Monetary Fund, said US shale has entirely changed the balance of power in the global oil market and there is little Opec can do about it. “Shale has become the swing producer. Opec has clearly lost its monopoly power and can only set a bottom for prices. As soon as the price rises, shale will come back on and push it down again,” he said. The question is whether even US shale can ever be big enough to compensate for the coming shortage of oil as global investment collapses. “There has been a $1.8 trillion reduction in spending planned for 2015 to 2020 compared to what was expected in 2014,” said Mr Yergin. Yet oil demand is still growing briskly. The world economy will need 7m b/d more by 2020. Natural depletion on existing fields implies a loss of another 13m b/d by then. Adding to the witches’ brew, global spare capacity is at wafer-thin levels - perhaps as low 1.5m b/d - as the Saudis, Russians, and others, produce at full tilt. 'If there is any shock the market will turn on a dime,' he said. The oil market will certainly feel entirely different before the end of this decade. The warnings were widely echoed in Davos by luminaries of the energy industry. Fatih Birol, head of the International Energy Agency, said the suspension of new projects is setting the stage for a powerful spike in prices. Investment fell 20pc last year worldwide, and is expected to fall a further 16pc this year. “This is unprecedented: we have never seen two years in a row of falling investment. Don’t be misled, anybody who thinks low oil prices are the ‘new normal’ is going to be surprised,” he said. Ibe Kachikwu, Nigeria oil minister and the outgoing chief of Opec, said the ground is being set for wild volatility. “The bottom line is that production no longer makes any sense for many, and at this point we’re going to see a lot of barrels leave the market. Ultimately, prices will shoot back up in a topsy-turvey movement,” he said...Saudi Arabia has made it clear that there can be no Opec deal to cut output and stabilize prices until the Russians are on board, and that is very difficult since Russian companies are listed and supposedly answerable to shareholders."
Saudis ‘will not destroy the US shale industry’
Telegraph, 24 January 2016

2015

"Ten years ago you couldn’t avoid it if you tried. Books by James Howard Kunstler, Richard Heinberg, Kenneth Deffeyes, and others were warning that worldwide oil production would inevitably peak soon, based on analysis similar to that of celebrated geologist M. King Hubbert, who predicted, in 1956, that U.S. oil production would peak between 1965 and 1970. Darn if he wasn’t right. With the presumed world peak in oil production, national economies hooked on injecting oil straight into their largest arteries then began to decline. Peak oil doesn’t mean oil would disappear – half of it would still be left – just that less of it would be produced each year going forward, and shell-shocked economies would fall into a permanent state of recession as consumers battled, Mad Max-like, for every last barrel. Except “events never play out the way one expects,” said James Murray, a speaker at a session entitled “Is Peak Oil Dead and What Does It Mean for Climate Change?” at the AGU Fall Meeting in the City by the Bay. Technology came to the rescue, in the forms of fracking and three-dimensional directional drilling. U.S. oil production soared upward 54 percent in just five years, from 3.3 billion barrels in 2009 to 5.1 billion barrels in 2014. Although world oil production increased by only 8.5 percent in that time, it was enough to keep it from peaking. So is peak oil now an outdated concept, or does it still lie in our future? The latter, most experts at the AGU meeting were saying, while admitting they hadn’t foreseen the technological revolution that has allowed U.S. oil and gas production to soar over the past decade. Those resources are finite, and the cost of extracting them increases once the low-hanging fruit are picked. Oil has dropped to about $35 per barrel because oil producers, hungry for unconventional oil from tar sands and gas from shale, overproduced. Yet they’re still not making money, said James Murray from the University of Washington. Shale oil – what the industry calls “tight shale” – “is profitable for drillers, hotels and restaurants, but not for investors,” he said. Cash flow in this sector was $10 billion in the red in 2014, even as yet more money is plowed into it from, Murray thinks, investors desperate for yields as the Federal Reserve keeps inerest rates extremely low. Murray said the break-even price for conventional oil is $20 per barrel, but $75 per barrel for tight oil. So oil companies are drawing back: U.S. oil production seems to have peaked in July 2015, and even the Eagle Ford shale basin in Texas and the Bakken field in North Dakota are cutting back. “The world may be close to peak oil production,” Murray concluded....David Hughes, president of Global Sustainability Research, Inc. in Calgary, pointed out that “the remaining reserves [of fossil fuels] are large, but of lower quality and require more energy to produce.” He estimated that more than 90 percent of what are known in the field as 'unconventional sources' – shale gas and oil and tar sands oil – 'are not recoverable.'"
Whatever became of 'peak oil'? Still to come?
Yale Climate Connections, 18 December 2015

2014

"It is now generally accepted by those actually studying the issue that production of 'conventional oil,' which is what the early 'peakists' were talking about 10 or 15 years ago, really did stop growing back in about 2005-2008. Since then official 'oil' production numbers have continued to climb slowly, but included in the 'official' numbers as put out by the US and international agencies is not all your grandfather’s oil. Instead the compilers of our oil statistics have learned to lump all sorts of liquid hydrocarbons of varying utility together and tell us that oil in the form of 'all liquids' continues to grow. Now these hydrocarbons such as natural gas liquids, biofuels, tar sands, and shale oil have uses, but they either cost considerably more to produce than conventional oil, or do not have the same energy content as conventional oil. In at least one case, 'refinery gains' which are sort of like whipping up a pint of cream into gallons of whipped cream, have no additional energy in their expanded state at all. They simply fill more barrels and let us pretend we have more energy to use than we actually do. While the financial press continues to chatter endlessly about the technological breakthroughs that have brought us millions of barrels of new shale oil, sadly they have the basics of the story wrong. It is the high prices that 'oil' has been selling for in the last ten years, not the decades-old fracking technology that has allowed very expensive shale oil to be produced that is new. Even with the recent $40 per barrel price decline, oil is still selling for four times what it was going for 12 or 13 years ago. It is the surge in prices to circa $100 a barrel has allowed very expensive oil such as that from fracked shale wells, the Canadian tar sands, and deep offshore oil wells to be produced; now with oil selling for closer to $70 a barrel the question is how long oil that is no longer economic to produce will keep being extracted. The other question is just how much of our oil supply is in danger of being mothballed until prices climb again as they surely will. The reason for the current fall in prices is still in debate. The 'oil' supply has continued to creep up in recent years, but starting last June the demand for $100+ oil was no longer there. While demand in the 'rich' OECD countries has been down since the 2008 oil price spike, this year it seems to be the slowing Chinese economy and its reduced demand for raw materials that has been behind the sinking demand. Many of the developing economies have been growing and using more oil each year due to growing trade with the Chinese. Someday conventional wisdom will conclude that oil at circa $100+ a barrel was simply too much to sustain high rates of economic growth and so the growth fell taking oil demand along with it. "
The Peak Oil Crisis
Falls Church News-Press, 31 December 2014

2013

"The critical measure here is EROEI (the Energy Return On Energy Invested). The days of 100:1 energy returns are long gone. The ratio for new oil projects has declined from 30:1 to barely 10:1 since the 1970s. For global energy overall, the EROEI has declined from about 37:1 in 1990 to less than 14:1 now. The flip-side of EROEI is the real cost of energy. The cost ratio at an EROEI of 37:1 in 1990 was 2.6 per cent, but this has risen to 6.8 per cent today. The global EROEI may fall to 10:1 by 2020, increasing the energy cost 'levy' on the economy to 9 per cent. In blithe ignorance of this increasing levy, we have continued to grow the claims value of the financial system on the assumption of perpetual growth. These 'excess claims' show up as unsustainable debt, undeliverable welfare commitments, and unrealisable expectations for returns on investment. My calculations suggest that the system now owes $90 trillion (£55 trillion) more than it can deliver. For individuals, this is being manifested in the escalating real costs of fuel, power, food, water and physical infrastructure. Globally, it is visible in 'energy sprawl', as the energy-delivering infrastructure expands (both in scale and in cost) in response to the weakening in efficiency resulting from a deteriorating EROEI. As well as crimping disposable incomes and destroying returns on investment, this process is curbing our ability to invest in other things. The essential point is that the economy is not a monetary system governed by the theoretical 'laws' of economics, but an energy dynamic determined by the all-too-real laws of thermodynamics. Once we understand this, the squeeze on household prosperity becomes far less of a mystery."
Tim Morgan - The global economy sinks under its debts as the real cost of energy rises
City.AM, 24 October 2013

2012

"The most common misconception about peak oil is that it means the world is running out of oil. Many articles that seek to debunk the notion of peak oil start with that premise, and then they proceed to tear down that straw man. Peak oil is about flow rates, and the overall flow rate will begin to decline while there is still a lot of oil left in the ground. Another misconception is that peak oil beliefs are homogeneous. The beliefs among people who are concerned about the impacts of peak oil cover a wide span. There are those who believe that a peak is imminent, to be followed by a catastrophic decline....... A more mainstream peak oil position is that the real threat is much higher oil prices, leading to stagnant economies.... The points of contention are the timing, the steepness of the decline, the impact on the global economy and the ability of other energy sources to fill the supply gap. Some believe we will smoothly transition to alternatives, and some people believe peak oil will be catastrophic."
Peak Oil: Misconceptions and Realities
Investing Daily, 26 November 2012

2011

"...we are entering an era of scarce resources. Apart from the atomic bomb, this is the most dangerous development in two centuries..... New powers such as China and India are rising, not yet risen, mixing emphasis on their 'developing' status with assertiveness."
David Miliband, British Foreign Secretary, 2007-10
'It was not bin Laden who defined this decade'
London Times, 7 September 2011, Print Edition, P28

2010

"Bankers and the financial sector may have displaced energy from the front pages of the newspapers right now, but Energy Security remains at the top of the global political and economic agenda....The need to balance energy security, jobs and economic development while addressing the problem of climate change all contributed to the challenge politicians faced in Copenhagen. And that challenge means that energy security will dominate politics and policy for the next 12 months and considerably beyond.... Reliable and affordable supplies of hydrocarbon energy were taken for granted through much of the 20th century and laid the foundation for the world’s extraordinary economic progress. When concerns arose, it tended to be at times of war or turbulence, notably in the Middle East, or, closer to home, with industrial action. What’s different now is that energy security has become a defining issue for the 21st century, as one element in a complex energy challenge with strategic, economic and environmental dimensions.... Opening access to a range of potential operators encourages the most efficient solutions, and often involves partnerships that provide new combinations of skills. Iraq is a very good example. BP is teaming up there with CNPC of China and Iraq’s South Oil Company to drive a major investment programme that will nearly triple production from the super-giant Rumaila field. With this and the other agreements concluded with national and international oil companies in the last six months, Iraq has the potential to contribute 10mmb/d to global supplies in the next 10-15 years. That’s a big piece of the additional resource we need....The current debate about Copenhagen and sustainability add new urgency and importance to the broader discussion of energy security.  The challenge of creating a low-carbon economy is far from easy, requiring the wholesale re-engineering of the global economy over time."
Tony Hayard, Chief Executive of BP
The Challenge of Energy Security
Speech at London School of Economics, 4 February 2010

2009

"The most important contributors to the world’s total oil production are the giant oil fields....The evolution of decline rates over past decades includes the impact of new technologies and production techniques and clearly shows that the average decline rate for individual giant fields is increasing with time. These factors have significant implications for the future, since the most important world oil production base – giantfields –will decline more rapidly in the future, according to our findings.... By 2030 the production from fields currently on stream could have decreased by over 50% in agreement with IEA (2008) . The struggle to maintain production and compensate for the decline in existing production will become harder and harder. Our conclusion is that the world will face an increasing oil supply challenge, as the decline in existing production is not only high but also increasing."
Giant oil field decline rates and their influence on world oil production
Energy Policy Volume 37, Issue 6, June 2009

2008

"The global economy is tanking, U.S. forces remain tied up in Iraq, Afghanistan is on a downward spiral -- one might wonder why anyone would want to be U.S. president during these trying times. Recently, the nation's chief intelligence officer weighed in, painting an even more somber picture of a far more complicated world. National Intelligence Director Mike McConnell looked beyond the immediate future, focusing on what his analysts are telling him about the challenges the world community is likely to face by 2025. It isn't pretty. Speaking to an annual conference of intelligence officials and contractors, McConnell said demographics, competition for natural resources and climate change will increase the potential for conflict. President-elect Barack Obama may get a glimpse of some of those challenges on Thursday. McConnell is expected to lead Obama's first top-secret intelligence briefing, according to U.S. officials familiar with the process. According to McConnell's outlook, economic and population growth will strain resources. 'Demand is projected to outstrip the easily available supplies over the next decade,' he said at the annual conference. The intelligence community's forecast indicates oil and gas supplies will continue to dwindle and production will be concentrated in unstable areas, he said. And there appears to be no relief at hand. McConnell said studies have shown that new energy technologies -- such as biofuels, clean coal and hydrogen -- generally take 25 years to become commercially viable and widespread."
New president faces increased risk of conflict, intel chief says
CNN, 5 November 2008

2007

"If you speak to people in the industry, they will conceed that whatever my company may say publicly, we understand that we are facing decline in our own production and worldwide, we are not going to be able to produce more fuel liquids or crude oil in the near future... I was recently at a conference in New Mexico, sitting next to one of the recent CEOs of a major oil company and he, in response to a question from the audience, said 'of course I am a peakist, it is just a question of when it is coming' and I think that that is illustrative of once one is retired as a CEO, one is freer than one was in position to say I am a peakist. And what you hear privately from almost all people is we are coming to it.... I think that many of these politicians will ultimately find that the public blames them for its failure to warn them. Of course in a sense the public is responsible because it is the present public attitude to which politicians play up, and tell them what they want to hear but when the view of the world changes, what the public wanted to hear some time ago is no longer what they want to hear in the future."
James Schlesinger, former US Energy Secretary
Interview with David Strahan, ASPO 6, September 2007

2006

"The scarcity of energy supplies and the energy imbalance between nations is a threat to our prosperity and national security. As resources contract, oil-hungry economies will compete for dwindling supplies of hydrocarbons. Competition for fossil fuels will increase.... Energy resources have long been a major strategic concern: access to secure sources, control over supply lines: these are issues of national security.... The energy challenge is now more pressing than ever.... Global oil production is apparently nearing its peak.... current estimates seem to be converging on some point between 2010 and 2020.... [there] are five factors which are changing the energy landscape: rising demand; dwindling supply; greater concentration of resource in the hands of a few; limited spare capacity; and the environmental impacts of energy use.....This is not a problem that can wait ten years."
Sir David Manning, British Ambassador To The United States Of America
Speech at Stanford University, 13 March 2006

2005

".... a series of crises in oil supply is likely over the coming decades. The first, related to the peak and decline of non-OPEC production, is practically upon us and underpins the currently high oil prices...... The imminent inability of non-OPEC production to meet incremental demand and its decline after 2010 precipitates the second crisis as OPEC’s diminishing spare capacity (even with Iraq’s production back to preinvasion levels) becomes less and less able to accommodate short-term fluctuations.....The third crisis, due to OPEC’s incremental supply being unable to meet incremental demand, follows in the first half of the next decade. This assumes that OPEC’s reserves are as published. .....These crises will have global economic and geopolitical significance: The oil price will be high and volatile, and demand growth will have to be curtailed..."
Oil Supply Challenges - 2: What Can OPEC Deliver?
Oil and Gas Journal, 7 March 2005



The Energy Challenge Of The Post 9/11 Period

"The U.S. needs energy — lots and lots of energy — and 37.1% of it is currently supplied by oil. As the population expands and the policy decisions and technological innovations needed to make the switch to green, renewable energy sources lag, thirst for the stuff is only going to grow. Critics have long lamented that when it comes to energy policy, 9/11 was an opportunity for the country to have an honest debate about the choices it needs to make if it's ever going to break its addiction to oil. 'We need to address the underlying issue,' says Lisa Margonelli, director of the New America Foundation's Energy Policy Initiative, 'and that's our dependence on oil.' Having a national conversation now — an adult one — is the only way forward."
The Far-Ranging Costs of the Mess in the Gulf
TIME, 6 May 2010



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2018

"Unit costs dropped to $32.6 per barrel in 2016 from $39.4 per barrel in 2014 as companies tried to adjust to lower crude prices. Costs crept back up to $33.2 per barrel in 2017, according to a new report on the sector by Westwood Global Energy Group, based on 25 companies. However, cost cuts since 2014 and a reduction in the Brent discount in the peer group’s revenue has resulted in the breakeven oil price for the group dropping to $44.8 per barrel in 2017 from $61.5 per barrel three years ago. Westwood analyst Robert Stevens said the lower Brent breakeven price meant most firms in the group should be profitable this year, regardless of cost cuts stalling. Mr Stevens said: “The breakeven is around $45 per barrel, but the Brent crude price is currently $20 higher than that, so these companies don’t need unit costs to fall any further, with a few exceptions. “At current oil prices, most of the companies are fairly comfortable and should be profitable this year in terms of free cash flow generation.” The companies in this year’s study were slightly different to those which featured a year ago, when Mr Stevens said the sector was “out of the emergency room, but still in hospital”. Larger companies like Marathon Oil and Hess have been added to the analysis, and their exposure to relatively high cost US onshore assets has caused the overall cost base and breakeven price to go up. Mr Stevens said: “We reported in November that cost cutting was slowing down. Now, unit costs are pretty much flat. They’re not going down any more. “Overall, as an industry benchmark, I think it is fair to say we are not going to see costs coming down much further if oil prices stay where they are. “That’s a negative but there are positives. Higher oil prices mean companies are making more money. “They’re less in debt than they were a year ago.”... Australian firm Woodside had the lowest breakeven of $27 – with Scandinavian duo Aker BP and Lundin also below $30. Fourteen of the 25 companies were between $40 and $55.... Mr Stevens said Marathon had stopped conventional exploration to focus on US onshore plays. Meanwhile Hess is divesting from conventional assets outside Guyana, which has become the largest new oil province to emerge since pre-salt Brazil. In terms of exploration, he said Brazil and Suriname were also “exciting”, though there are doubts about the Barents Sea after a number of dry wells in 2017. Mr Stevens is also slightly sceptical about the profitability of US shale. He said: “If you look at Marathon, it makes a big song and dance about  prioritising US shale, but the company makes more from international E&P than US onshore. “Marathon has made a loss from US onshore for the last three or four years – its international business is the cash arm. “So it’s slightly misleading how US onshore plays are being presented. There are sweet spots of profit, but on the whole it hasn’t been profitable.”"

E&P cost cutting has ground to a halt, says Westwood

Energy Voice, 7 May 2018

"A “suitable price” for crude is $60 to $65 a barrel, Amir Hossein Zamaninia, deputy oil minister for international and commercial affairs, said in an interview Sunday in Tehran. Oil Minister Bijan Namdar Zanganeh said earlier in the day that Iran supports “reasonable” oil prices and is not an advocate of costlier crude. Brent crude futures surged above $75 a barrel to a three-year high on Monday as traders braced for the possible re-imposition of U.S. restrictions on Iran. The Persian Gulf country’s regional arch-rival Saudi Arabia is said to want crude closer to $80 a barrel, in part to support a stake sale in state energy giant Aramco. The OPEC nations continue to clash in proxy conflicts from Syria to Yemen. The Organization of Petroleum Exporting Countries will meet next month in Vienna. Together with allied producers, OPEC began reducing oil production last year in a drive to clear a global glut. The curbs have all but eliminated surplus oil inventories.... Even so, Saudi Arabia, the world’s largest crude exporter, is urging fellow members to keep curtailing output. The constant fluctuation in oil prices is destabilizing for future investment and security of supply, Zanganeh said."
Iran opposes higher oil prices, signalling divide with Saudi Arabia
Bloomberg, 7 May 2018

"Oil prices rose to their highest levels since late-2014 on Monday, boosted by Venezuela's deepening economic crisis and a looming decision on whether the United States will re-impose sanctions on Iran. Brent crude oil futures were at $75.63 per barrel at 0909 GMT, up 76 cents from their last close. Earlier in the session, they touched their highest since November 2014 at $75.89 a barrel.  U.S. West Texas Intermediate (WTI) crude futures rose 80 cents to $70.52 per barrel. Monday was the first time since November 2014 that WTI had climbed above $70 per barrel. China's Shanghai crude oil futures, launched in March, broke their dollar-converted record-high, rising as far as $72.54 on Monday. The increases came despite nine U.S. oil rigs bringing the total count to 834, energy services firm Baker Hughes said on Friday. Analysts said a crisis in Venezuela, a major oil exporter, underpinned prices. "The growth in production in the U.S. is being counterbalanced by the simultaneous decline in Venezuela," said Commerzbank analyst Carsten Fritsch. U.S. oil firm ConocoPhillips has moved to take key Caribbean assets of Venezuela's state-run PDVSA to enforce a $2 billion arbitration award, actions that could further impair PDVSA's declining oil production and exports. Venezuela's output has halved since the early 2000s to 1.5 million barrels per day (bpd), as the South American country has failed to invest enough in its oil industry.  Widespread expectations that U.S. President Donald Trump will withdraw from the Iranian nuclear pact added a further risk premium. Iran re-emerged as a major oil exporter in 2016 after international sanctions against it were lifted, and Trump has a May 12 deadline to determine whether to extend sanction waivers. On Monday, Saudi Arabian Energy Minister Khalid al-Falih said he is concerned about low oil industry investment and potential shortages in the future. But U.S. output has soared by more than a quarter in the last two years, to 10.62 million bpd. It will likely rise further this year as its energy firms keep drilling for more."
Oil surges to fresh highs on growing supply worries
Reuters, 7 May 2018

"Pierre Andurand, one of oil’s most prominent hedge fund managers, said the current reluctance of energy companies to invest in new production meant $300 a barrel was "not impossible" within a few years. Andurand, who’s often espoused bullish views, said in a series of tweets on Sunday that concern about the impact of electric vehicles on future demand was limiting investment in projects with long lead times. "So paradoxically these peak demand fears might bring the largest supply shock ever," he wrote. "If oil prices do not rise fast enough, $300 oil in a few years is not impossible." The hedge fund manager, who runs oil-focused Andurand Capital Management LLP, also went against the conventional view that triple-digit oil prices will dampen demand growth. "So no, $100 oil will not kill the economy," he wrote. "And we need +$100 oil to encourage enough investments outside of the U.S." A spokesman for Andurand declined to comment on the tweets, which were later removed from Andurand’s Twitter account. His comments on demand echo those of Saudi Oil Minister Khalid Al-Falih, who earlier this month suggested that prices could rise further from their current level close to $75 a barrel without doing economic damage. “We have seen prices significantly higher in the past, twice as much as where we are today”, and the global economy has the ability to absorb costlier crude, Al-Falih said. In 2008 Brent crude rose to nearly $150 a barrel, before crashing."
Oil Hedge Fund Manager Says $300 Oil ‘Not Impossible’
Bloomberg, 30 April 2018

"A United Arab Emirates energy company and two Chinese firms emerged Thursday as the only winners in Iraq's rushed bidding round for nearly a dozen hydrocarbon-rich areas. Only nine companies out of 26 originally prequalified decided to take part. And major oil companies — Russia's Bashneft, Lukoil and Gasprom, America's ExxonMobil, and France's Total — were supposed to bid but withdrew. The auction, Iraq's fifth auction since opening its vast resources to international energy companies in 2009, was announced last year with the deadline to receive bids on late June. But last month, Oil Minister Jabar Ali al-Luaibi unexpectedly moved the date to April, leaving the companies with a short period of time to study the offered contracts. Al-Luaibi's move was seen as a political maneuver ahead of May 12 national elections in which he is campaigning for a seat in parliament. He hopes to represent the oil-rich southern province of Basra as a member of the Victory Alliance, which is led by Prime Minister Haider al-Abadi, who is running for re-election. Addressing the bidders, al-Laubi denied any other reason other than developing the country's border fields that "were neglected for five decades in a best way possible." In previous bidding rounds, officials spent months hosting conferences, road shows and discussions with companies before issuing final contracts. The UAE Crescent Petroleum landed three deals almost without any competition. Two are for the Gilabat-Qumar and Khashim Ahmer-Injana gas fields in Diyala province in northwestern Iraq. The company will be entitled to 9.21 percent and 19.99 percent of net profits, respectively, from the two fields. The third deal is to explore and develop the oil-rich Khider Al-Mai block that is shared by the southern Basra and Muthana provinces. The UAE company's share in the net profit will be 13.75 percent. China's Geo-Jade company won the rights to explore Naft Khana block in Diyala, rich with oil and dried gas, and Huwaiza block in southern Mayssan province. Its share of net profits from the two blocks will be 14.67 percent and 7.15 respectively. And China's UEG won the rights to explore and develop Sindbad green oil field in Iraq's Basra region. It will be entitled to 4.55 percent of the net profit. Six other blocks — Zurbatiya, Shihabi, Jebal Sanam, Fao and the Arabian Gulf in Iraq's territorial waters in the Persian Gulf— in central and southern Iraq received no bids.... Iraq's previous bidding rounds succeeded in awarding rights to develop major oil and gas fields that hold more than half of its 153.1 billion barrels of proven oil reserves. Then, the auctions drew majors like U.S.'s Exxon Mobil, Royal Dutch Shell, the U.K.'s BP, China's CNPC and Russia's Lukoil. As a result, Iraq's daily production and exports have jumped to levels not seen since the late 1970s and early 1980s. The nation is now OPEC's second-largest producer behind Saudi Arabia with daily production of around 4.36 million barrels a day from Baghdad-controlled oil fields, up from nearly 2.4 million a day in 2009. Daily exports averaged 3.450 million barrels a day last month."
Iraq awards UAE, China rights to develop oil in northeast
Associated Press, 29 April 2018

"Shutting down oil and gas operations in the North Sea is likely to cost double the government’s current target, leaving younger generations with a hefty tax bill. An analysis of current government figures suggests the goal of £39bn to dismantle the region’s pipelines and wells is a significant underestimate. Instead, a figure of over £80bn is cited as a far more realistic projection in the new report for the Intergenerational Foundation (IF). The higher price tag will leave each child in the UK with a bill of up to £3,000 if the government allows companies drilling in the North Sea to avoid their decommissioning obligations."
Cost of dismantling North Sea oil and gas likely to be double government target
Independent, 29 April 2018

"Oil will be in plentiful supply and prices are likely to remain under pressure in the long term, according to the outgoing chairman of BP, who said there must be no let up in the company’s efforts to lower costs. Carl-Henric Svanberg, the Swede who is due to step down at the end of this year, said BP was “still working with the assumption that this is going to be a world with an abundance of oil” despite recent tightening in the crude market.  Brent crude, the international benchmark, has climbed to more than $75 a barrel for the first time in four years, reflecting increasing demand, supply curbs from Opec producer nations and Russia, and concern about geopolitical tensions in the Middle East.  This is fuelling a resurgence of profitability for the world’s largest oil and gas companies, several of which announced sharp increases in first-quarter profits last week. BP reports its results on Tuesday.  However, Mr Svanberg, who has been chairman for eight years, said there would be no return to the ill-disciplined spending that characterised the industry until oil prices crashed from more than $100 a barrel in 2014. .... BP has cut its unit production costs by 46 per cent since 2013 and reduced capital expenditure by a third. Bob Dudley, chief executive, has set a target to lower the group’s break-even point — the oil price needed to cover dividends and capital investment — to less than $40 a barrel within five years, from about $50 last year....  Most of the big oil and gas groups are echoing Mr Svanberg’s rhetoric about the need to maintain spending discipline, given the prospect of growing US shale supplies and long-term curbs on oil demand from the rise of renewable energy and electric vehicles. However, Mr Svanberg saw little threat of a precipitous decline in oil demand, highlighting forecasts from the International Energy Agency that, even if the world delivered on the Paris climate agreement, there would still be a need for 95m barrels of oil a day in 2040. “Even more than 20 years out, the world market for oil and gas will be similar to what it is today,” he said. “It is not disappearing in front of us.” "
BP sees no let up in pressure on global oil prices
Financial Times, 29 April 2018

"The UK would have to build 6,100 wells to replace just 50 per cent of gas imports between 2021 and 2035, a new study has found, casting doubt on Conservative calls a US-style fracking “revolution” in the UK at the last general election. The party claimed it would push down gas prices for consumers and make Britain less reliant on imports from countries including Russia. But a new study by Cardiff Business School has found that one well would have to be drilled and fracked every day for 15 years for half of gas imports to be replaced. And if the quantities of gas produced per well was at the lower end of the amount forecast, the report suggests the number of wells required could rise to as many as 16,500 in total. Drilling 6,100 wells would require more than 1,000 separate well pads for drilling equipment each covering 3.5 hectares. Each well pad requires access roads and facilities such as mobile portacabins for offices. The amount of space is equivalent to around 4,900 football pitches, according to Friends of the Earth, which commissioned the study. Rose Dickinson, from the organisation said: “This would mean an industrialisation of our countryside at a rate that nobody has yet fully appreciated and would put many more communities in the firing line of this dirty and unwanted industry.” Fracking has been banned or suspended in Scotland, Wales and Northern Ireland, leaving England as the only country where it remains an option....  In addition, the Labour Party, Liberal Democrats and the Greens are all opposed to the practice, which involves pumping water and chemicals deep underground to fracture shale rock to access gas reserves. The Conservatives’ 2017 manifesto said: “The discovery and extraction of shale gas in the United States has been a revolution. Gas prices have fallen, driving growth in the American economy and pushing down prices for consumers. "The US has become less reliant on imported foreign energy and is more secure as a result. We will therefore develop the shale industry in Britain.” When he was mayor of London Boris Johnson was a particularly vocal supporter of fracking in Britain.  The foreign secretary wrote that the UK was “increasingly and humiliatingly dependent on Vladimir Putin’s gas or on the atomic power of the French state,” and calling for the UK to “get fracking right away”.  Britain imports 59.8 per cent of all the gas we use. Of that figure, around 1 per cent now comes from Russia.  Norway is the principal source of UK gas imports, at 75 per cent, up from 65 per cent in 2016, according to government figures. Meanwhile, over the past six years the UK’s renewable electricity output has leapt from providing 9 per cent to almost 30 per cent of UK electricity, recent government figures reveal. Daniel Carey-Dawes, senior infrastructure campaigner at the Campaign to Protect Rural England, said: "The fracking industry has always been clear that fracked gas would replace what's currently imported, but what wasn't clear was the scale of land take that would involve. "The many thousands of wells that would be needed, peppered across our precious landscapes, would cause harm to the English countryside on an industrial scale." The report concludes that “there is no evidence that fracked gas can be brought to market at sufficiently low cost, and sufficiently great volume to make any significant profit, or to make any difference to the UK energy security position.” A Department for Business, Energy & Industrial Strategy spokesperson told The Independent: “The UK Government is committed to ensuring we have secure energy supplies that are reliable, affordable and clean. As part of this, shale gas has the potential to be a home-grown energy source which can lead to jobs and economic growth, contribute to our security of supply, and help us achieve our climate change objectives. “We have been clear that shale development in the UK must be safe and environmentally sound and we have a strong regulatory system in place.”
More than 6,000 fracking wells needed in UK to halve gas imports, study says
Independent, 25 April 2018

"...buses with battery-powered motors are a serious matter with the potential to revolutionize city transport—and add to the forces reshaping the energy industry. With China leading the way, making the traditional smog-belching diesel behemoth run on electricity is starting to eat away at fossil fuel demand. The numbers are staggering. China had about 99 percent of the 385,000 electric buses on the roads worldwide in 2017, accounting for 17 percent of the country’s entire fleet. Every five weeks, Chinese cities add 9,500 of the zero-emissions transporters—the equivalent of London’s entire working fleet, according Bloomberg New Energy Finance. All this is starting to make an observable reduction in fuel demand. And because they consume 30 times more fuel than average sized cars, their impact on energy use so far has become much greater than the passenger sedans produced by companies from Tesla Inc. to Toyota Motor Corp. For every 1,000 battery-powered buses on the road, about 500 barrels a day of diesel fuel will be displaced from the market, according to BNEF calculations. This year, the volume of fuel not needed may rise 37 percent to 279,000 barrels a day because of electric transport including cars and light trucks, about as much oil as Greece consumes, according to BNEF. Buses account for about 233,000 barrels of that total. “This segment is approaching the tipping point,” said Colin McKerracher, head of advanced transport at the London-based research unit of Bloomberg LP. “City governments all over the world are being taken to task over poor urban air quality. This pressure isn’t going away, and electric bus sales are positioned to benefit.” China is ahead on electrifying its fleet because it has the world’s worst pollution problem. With a growing urban population and galloping energy demand, the nation’s legendary smogs were responsible for 1.6 million extra deaths in 2015, according to non-profit Berkeley Earth....  Other cities are taking notice. Paris, London, Mexico City and Los Angeles are among 13 authorities that have committed to only buying zero emissions transport by 2025. London is slowly transforming its fleet. Currently four routes in the city center serviced by single-decker units are being shifted to electricity. There are plans to make significant investments to the clean its public transport networks, including retrofitting 5,000 old diesel buses in a program to ensure all buses are emission-free by 2037. Transport for London, responsible for the city’s transport system, declined to comment for this article because of rules around engaging with the media ahead of May local government elections. Those goals will have an impact on fuel consumption. London’s network draws about 1.5 million barrels a year of fuel. If the entire fleet goes electric, that may displace 430 barrels a day of diesel for each 1,000 buses going electric, reducing U.K. diesel consumption by about 0.7 percent, according to BNEF.  Across the U.K. there were 344 electric and plug-in hybrid buses in 2017, and BYD hopes to be picked to supply more. It has partnered with a Scottish bus-maker to provide the batteries for 11 new electric buses that hit the city’s roads in March. Falkirk-based manufacturer Alexander Dennis Ltd. began making electric buses in 2016 and has quickly become the European market leader with more than 170 vehicles operating in the U.K. alone."
Electric Buses Are Hurting the Oil Industry
Bloomberg, 25 April 2018

"The end of Russian gas transit via the territory of Ukraine will increase the possibility of a conflict between Russia and Ukraine and entail futher geopolitical consequences, the commercial director of Ukraine’s oil and gas company Naftogaz said. "If there is no transit via the territory of Ukraine, the possibility of a full-fledged conflict between Ukraine and Russia also increases, which will have geopolitical consequences. This is the idea that we are trying to convey, first of all to European partners, who need to understand not only economic consequences for Ukraine, but also geopolitical consequences for the entire world," Yuri Vitrenko was quoted as saying by the 112 Ukraine TV channel on Tuesday. Gazprom Deputy CEO Alexander Medvedev said on Tuesday that the contract with Ukraine after 2019 will not be renewed under any circumstances but this does not mean that the transit of gas will be stopped. He said Gazprom was waiting for Ukraine’s "appropriate proposals," including on economic terms of the transit. Gazprom CEO Alexei Miller told reporters that the company is ready to hold negotiations with Naftogaz of Ukraine on gas transit after the expiration of the current contract. But Ukraine should ground economic feasibility of the transit, he added. Miller also said that if Ukraine proves the economic feasibility of the new contract Gazprom may maintain the volume of gas transit via Ukraine at 10-15 bcm a year."
End of gas transit via Ukraine to have ‘geopolitical consequences’ — Naftogaz
TASS, 25 April 2018

"U.S. conglomerate General Electric will test the world’s largest wind turbine in a facility in northeast England, it said on Tuesday. GE Renewable Energy, the renewable arm of the U.S. firm, and the British government-funded Offshore Renewable Energy Catapult signed a five-year agreement to test GE’s Haliade-X 12 megawatt (MW) turbine in Blyth, Northumberland. “This is an important agreement because it will enable us to prove Haliade-X in a faster way by putting it under controlled and extreme conditions,” John Lavelle, president & CEO of GE’s Offshore Wind business said in a statement. Britain is aiming to be a leader in offshore wind technology and its capacity could grow by five times current levels to 30 gigawatts by 2030, according to a report funded by a range of industry participants. Britain’s energy and clean growth minister Claire Perry welcomed the agreement and said it highlights Britain’s world class research and testing facilities. The largest wind turbines currently in operation are MHI Vestas’ 9 MW turbines installed at Vattenfall’s windfarm off the coast of Aberdeen, Scotland. Companies have been building larger turbines to help get more power from each turbine installed and drive down the cost of the electricity they produce."
General Electric to trial world’s largest wind turbine in Britain
Reuters, 24 April 2018

"Electric buses were seen as a joke at an industry conference in Belgium seven years ago when the Chinese manufacturer BYD Co. showed an early model. “Everyone was laughing at BYD for making a toy,” recalled Isbrand Ho, the Shenzhen-based company’s managing director in Europe. “And look now. Everyone has one.” Suddenly, buses with battery-powered motors are a serious matter with the potential to revolutionize city transport—and add to the forces reshaping the energy industry. With China leading the way, making the traditional smog-belching diesel behemoth run on electricity is starting to eat away at fossil fuel demand. The numbers are staggering. China had about 99 percent of the 385,000 electric buses on the roads worldwide in 2017, accounting for 17 percent of the country’s entire fleet. Every five weeks, Chinese cities add 9,500 of the zero-emissions transporters—the equivalent of London’s entire working fleet, according Bloomberg New Energy Finance. All this is starting to make an observable reduction in fuel demand. And because they consume 30 times more fuel than average sized cars, their impact on energy use so far has become much greater than the passenger sedans produced by companies from Tesla Inc. to Toyota Motor Corp. For every 1,000 battery-powered buses on the road, about 500 barrels a day of diesel fuel will be displaced from the market, according to BNEF calculations. This year, the volume of fuel not needed may rise 37 percent to 279,000 barrels a day because of electric transport including cars and light trucks, about as much oil as Greece consumes, according to BNEF. Buses account for about 233,000 barrels of that total. “This segment is approaching the tipping point,” said Colin McKerracher, head of advanced transport at the London-based research unit of Bloomberg LP. “City governments all over the world are being taken to task over poor urban air quality. This pressure isn’t going away, and electric bus sales are positioned to benefit.” China is ahead on electrifying its fleet because it has the world’s worst pollution problem. With a growing urban population and galloping energy demand, the nation’s legendary smogs were responsible for 1.6 million extra deaths in 2015, according to non-profit Berkeley Earth.... Other cities are taking notice. Paris, London, Mexico City and Los Angeles are among 13 authorities that have committed to only buying zero emissions transport by 2025. London is slowly transforming its fleet. Currently four routes in the city center serviced by single-decker units are being shifted to electricity. There are plans to make significant investments to the clean its public transport networks, including retrofitting 5,000 old diesel buses in a program to ensure all buses are emission-free by 2037.... Across the U.K. there were 344 electric and plug-in hybrid buses in 2017, and BYD hopes to be picked to supply more. It has partnered with a Scottish bus-maker to provide the batteries for 11 new electric buses that hit the city’s roads in March. Falkirk-based manufacturer Alexander Dennis Ltd. began making electric buses in 2016 and has quickly become the European market leader with more than 170 vehicles operating in the U.K. alone. More work is on the horizon, with London’s transport authority planning a tender to electrify its iconic double-decker buses, Ho said."
Electric Buses Are Hurting the Oil Industry
Bloomberg, 23 April 2018

"Oil prices retreated from multi-year highs as US President Donald Trump lashed out at the world’s largest oil producing nations during a meeting which exposed rifts at the heart of the Opec cartel. President Trump blamed the group for forcing global prices to “artificially” high levels, and warned that it “will not be accepted”, in a tweet during a key meeting between Saudi-led oil producers and Russia. The meeting revealed a splintering of views between the pair over whether to keep a squeeze on crude production to drive prices higher or begin to ease supply cuts again. The uncertainty quickly punctured the confidence of the oil market over the last week, causing prices to plummet from fresh highs of $74.70 a barrel on Thursday to below $73 before making a modest recovery. The Organisation of Petroleum Exporting Countries (Opec) met with non-Opec nations in Saudi Arabia on Friday to discuss the progress of its year-long supply deal just days after oil prices rallied to their highest level since December 2014."
Opec v Trump: oil markets retreat as rifts emerge

Telegraph, 20 April 2018

"Russia’s No. 2 oil producer Lukoil has started operations at a $3.4 billion gas processing plant at its Kandym gasfield in Uzbekistan, which is seen as central to its efforts to boost gas production and exports to China. The Russian government said in a statement on Thursday that the gas processing complex, with a capacity of 8 billion cubic meters (bcm) per year, had been launched ahead of schedule. Lukoil has not revealed any data on gas exports to China from Uzbekistan. Lukoil also said on Thursday it has raised a $660 million loan to finance part of the cost of building the gas plant in Uzbekistan. Lukoil is working in the country under a production-sharing agreement that accounts for a quarter of all of Uzbekistan’s gas output. The company plans to double gas production in Uzbekistan to 16 bcm per year by 2020 from 8 bcm in 2017. Lukoil’s total gas output reached almost 33 bcm in 2017. Uzbekneftegaz head Alisher Sultanov said last September that Uzbekistan had contracts to export up to 6 bcm of gas to Russia and up to 10 bcm to China per year."
Russia's Lukoil starts up Uzbekistan gas plant for Chinese exports
Reuters, 19 April 2018

"The UK has just gone a record amount of time without using coal to generate electricity. National Grid confirmed Britain operated without coal for more than two days, or just under 55 hours, between 10.25pm on Monday to 5.20am this morning. The previous record was a stretch of 40.5 hours between the 28 October and 30 October 2017. The UK has made strides towards a low-carbon economy over the past few years, including the continued work to phase out its last remaining coal-fired power plants by 2025. Government figures released last month revealed the UK's carbon emissions dropped by three per cent last year as coal-fired power generation plummeted. Coal use for electricity fell 28 per cent between 2016 and 2017 to a record low as two more coal-fired plants were shut down over the year. This time last year, Britain spent 24 hours without using coal as part of its energy mix for the first time since the Industrial Revolution. The UK has set a target of cutting emissions to 80 per cent below 1990's level by 2050."
Britain just went more than two days without coal – a new record
City AM, 19 April 2018

"There are increasing signs that a break above $80 for a barrel of oil is now on the cards, after benchmark Brent crude prices closed on Friday night at $72.58 a barrel. That capped a weekly gain of 7.9%, while West Texas Intermediate (WTI) oil closed at 67.39, which left both measures at their highest level since 2014. Heightened geo-political tensions have been the main catalyst for the recent price action, and the US-led attack on chemical weapons facilities in Syria over the weekend did nothing to dispel the threat of further conflict in the region. Markets are also assessing the prospect of a breakdown in the nuclear disarmament deal between the US and Iran, with President Donald Trump pushing for key changes by May 12 which could see the US withdraw from the agreement..... The analysts forecast that geo-politial tensions will keep oil elevated above $70 a barrel through April and May, before prices decline towards $60 a barrel by the end of the year."
Forces are aligning that could see oil rise back above $80 a barrel
Business Insider, 16 April 2018

"China is taking its first steps towards paying for imported crude oil in yuan instead of the U.S. dollar, three people with knowledge of the matter told Reuters, a key development in Beijing's efforts to establish its currency internationally. Shifting just part of global oil trade into the yuan is potentially huge. Oil is the world's most traded commodity, with an annual trade value of around $14 trillion, roughly equivalent to China's gross domestic product last year. A pilot program for yuan payment could be launched as early as the second half of this year, two of the people said. Regulators have informally asked a handful of financial institutions to prepare for pricing China's crude imports in the yuan, said the three sources at some of the financial firms.... China is the world's second-largest oil consumer and in 2017 overtook the United States as the biggest importer of crude oil. Its demand is a key determinant of global oil prices. Under the plan being discussed, Beijing could possibly start with purchases from Russia and Angola, one of the people said, although the source had no details of anything in the works. Both Russia and Angola, like China, are keen to break the dollar's global dominance. They are also two of the top suppliers of crude oil to China, along with Saudi Arabia. The move would mark a major step in reviving usage of the currency of the world's second-largest economy for offshore payments after several years of on-again, off-again measures."
China is reportedly taking the first steps to pay for oil in yuan: Sources
Reuters, 31 March 2018


"Britain's greenhouse gas (GHG) emissions fell by 3 percent last year from 2016 levels, largely due to a decline in coal-fired power generation and marking the fifth straight yearly drop, preliminary government data showed on Thursday. Output of the heat-trapping gases in Europe's second-largest emitter behind Germany fell to 456 million tonnes of carbon dioxide equivalent (CO2e), the Department for Business, Energy and Industrial Strategy (BEIS) said. Thursday's data shows Britain's GHG emissions have fallen 43 percent since 1990, meaning it is more than half way towards meeting a legally binding target to cut its GHG emissions by 2050 to 80 percent below 1990 levels. A breakdown of the 2017 figures showed emissions of carbon dioxide (CO2), the main greenhouse gas blamed for climate change, fell 3 percent to 367 million tonnes. Energy-sector CO2 emissions fell by 8 percent as coal-fired power production dropped, and was replaced by record output from renewables such as wind and solar. Separate provisional data, released by BEIS on Thursday, showed power generation from coal plants fell 26 percent in 2017 to 21.36 terawatt hours (TWh), making up less than 7 percent of Britain's total electricity supply. Britain plans to close all coal-fired power stations by 2025 unless they are fitted with technology to capture and store carbon emissions. Earlier this month, it also rejected plans for a new open cast coal mine in northeastern England on climate grounds. Gas-fired power generation fell almost 6 percent in 2017, while renewable power generation from wind and solar soared, the data showed. Wind power rose 33 percent to a record 40.9 TWh while solar generation was up 43 percent to a record 2.9 TWh."
Britain's greenhouse gas emissions fall again as coal use plummets
Reuters, 29 March 2018

"The OIES paper UK dependence on imported hydrocarbons: how important is Russia? notes that one of the greatest risks is the lack of domestic gas storage capacity, now Centrica's Rough storage facility under the North Sea is being closed. That means the UK is more dependent on spot LNG cargoes and extra pipeline gas purchases from Europe via two interconnectors from Belgium and the Netherlands—which includes Russian gas in the mix, of course—to fill the gap during unforeseen spikes in demand. This also leaves the country more vulnerable to spikes in the UK National Balancing Point (NBP) prices, such as that which accompanied cold weather in early March. "If the NBP price spikes had not attracted LNG deliveries to replenish storage tanks at the UK's LNG terminals, and the period of both cold weather and consequent increased UK gas demand had continued, the UK could have faced a more severe gas shortage," the paper said.... As the UK becomes more dependent on gas imports, given dwindling gas supply from its parts of the North Sea, so NBP pricing has moved closer to that in north-west Europe. That means any interruption in gas flows to continental Europe would also affect UK gas prices. So, if European support for the UK over the nerve agent attack—manifest in the round of diplomatic expulsions that took place in March—or, indeed, anything else leads to restrictions on Gazprom's gas supply to European markets, then the UK would also probably feel the impact. Despite this, the idea that Gazprom or even its European gas marketing arm could directly affect UK gas supply seems remote—there are plenty of other places to buy gas in Europe. But Brexit could increase gas supply risks faced by the UK, should the UK's departure from the EU mean it is no longer be part of gas-sharing mechanisms in place to deal with regional gas shortages. If the UK becomes a competitor to the EU for LNG cargoes or pipeline gas, then securing supplies in an emergency would become that much harder."

UK gas security safe from Russian reprisals
Petroleum Economist, 29 March 2018

"Oil prices are likely to rise this year thanks to supply disruptions and an OPEC-led deal to limit production, but doubts over the future of compliance with the multilateral agreement and rising U.S. production could stem the upward momentum, a Reuters poll showed on Thursday. A survey of 31 economists and analysts polled by Reuters showed Brent crude <LCOc1> would average nearly $64 a barrel in 2018, versus $63 forecast in the February survey, but below the $67.18 average for the benchmark so far in 2018.  Brent prices have risen 4 percent this year, supported by a deal between the Organization of the Petroleum Exporting Countries and non-OPEC producers led by Russia to curb output by about 1.8 million barrels per day (bpd) through 2018. The price briefly rose above $70 a barrel this week, supported by tension in the Middle East and declining output in Venezuela, one of the group's largest producers, where economic crisis has cut production to its lowest in nearly 30 years. A sustained drawdown in U.S. inventories also helped push the price up towards $70, a peak last seen in December 2014."
Oil to rise in 2018 as OPEC wages tug-of-war with U.S. shale - Reuters Poll
Reuters, 29 March 2018

"The economics of generating electricity from fossil fuels are deteriorating rapidly as renewable energy technology plunges in costs. That’s the conclusion of a Bloomberg New Energy Finance report on the levelized cost of energy, a measure that takes into account the expenses from buying equipment, servicing debt and operating power plants using each technology. In most places, wind and solar will work cheaper than coal by 2023, the research group said Wednesday. “Some existing coal and gas power stations, with sunk capital costs, will continue to have a role for many years, doing a combination of bulk generation and balancing,” said Elena Giannakopoulou, head of energy economics at BNEF. “But the economic case for building new coal and gas capacity is crumbling.” The findings put in context the many factors upending the calculations about the best way to generate electricity in the coming years. In a 104-page report, BNEF examined the economics of the industry in key jurisdictions from China and the U.S. to India and Australia, assessing the main renewable technologies. One new factor: lithium-ion batteries have enjoyed a 79 percent drop in costs since 2010, making the idea of storing energy a possibility the coming years. The price per megawatt-hour for generating from wind farms built on land fell 18 percent in the first half of 2018 to $55 while photovoltaics dropped 18 percent to $70.... The cheapest solar and wind costs can now be found in China and India, which are also among the worst polluters. The tumbling costs will continue until at least until 2040 for both renewable energy sources worldwide and they’ll become cheaper than coal and gas within five years, the report showed. Coal and gas generate more than a third of the world’s electricity. For now, they remain the cheapest sources of electricity even after the sharp drops in the cost of wind and solar power. Battery costs are also starting to change the way power utilities think about how they generate. At the moment, electricity is costly to bottle up at scale, with most storage done through pumped hydro projects. Those raise water into a reservoir when power prices are cheap then allow it to flow over a turbine when the electricity is needed. Cheaper batteries could allow utilities to store up electricity that was generated during the day by solar farms and use it at night. They could preserve power from windy days for times when it’s calm. Adding a battery to an existing wind or solar plant can give it access to high-value hours. By 2025, four-hour battery energy storage will start to compete with gas plants, even in countries with cheap gas generation like the U.S., BNEF said."
Fossil Fuels Squeezed by Plunge in Cost of Renewables, BNEF Says
Bloomberg, 28 March 2018

"China met its 2020 carbon intensity target three years ahead of schedule last year, the official Xinhua news agency reported on Tuesday, citing the country’s top climate official Xie Zhenhua. China, the world’s biggest energy consumer, cut its 2005 carbon intensity level, or the amount of climate-warming carbon dioxide it produces per unit of economic growth, by 46 percent in 2017, Xie told a forum in Shanghai on Tuesday.Carbon intensity fell 5.1 percent in 2017 compared to the previous year, Xinhua said, suggesting that China’s war on pollution also helped reduce greenhouse gas emissions. China originally promised to cut its 2005 carbon intensity by 40 percent to 45 percent. The pledge, first made in 2009, was included in the country’s commitments to the international community ahead of negotiations for a new global climate pact in Paris in 2015. However, China struggled to honor another promise to establish a nationwide emissions cap and trade system by 2017, with the scheme delayed by technical problems, including the reliability of emissions data. The country eventually settled for a scaled-back scheme involving only the power sector, which was launched in December last year. In his speech, Xie said the national market, though only at an embryonic stage, already covers about 1,700 power firms with total carbon dioxide emissions in excess of 3 billion tonnes, making it the world’s biggest. He said China would continue to work to expand coverage to other industries."
China meets 2020 carbon target ahead of schedule: Xinhua
Reuters, 27 March 2018

"Qatar has proposed that Russian companies take part in tenders for the further development of gas fields in 2019-2020, RIA news agency cited the Qatari envoy to Russia Fahad bin Mohammed Al-Attiyah as saying on Sunday. “Russian companies, like others, may try to win the tender, which will be announced,” he is quoted as saying. Russian President Vladimir Putin will meet the Emir of Qatar in Moscow on March 26, the Kremlin said on Friday. They will discuss the development of Russian-Qatari relations, as well as international and regional issues, according to a Kremlin statement."
Qatar proposes Russian companies develop gas fields in 2019-2020 -RIA
Reuters, 25 March 2018

"China is set to launch its long-awaited renminbi-denominated oil futures contract on Monday, as the world’s largest crude importer seeks to extend its influence over the pricing of barrels sold into Asia. The Shanghai International Energy Exchange has set the opening price for the front-month of its crude futures contract at Rmb416 a barrel, about $66. China imported 8.4m barrels a day last year, outpacing the US, which buys 7.9m b/d from overseas markets, according to the US energy department. After establishing itself as a leading buyer of physical barrels, China has ambitions to exert the same power over the trillions of dollars traded each year in oil futures contracts. The country also seeks to make its currency a bigger player on the world stage, extending its clout over the global economy."
China seeks to extend oil market clout with new contract
Financial Times, 25 March 2018

"Proven oil and gas reserves in Mexico fell again this year as new discoveries failed to keep pace with ongoing production, but officials pointed to the first-ever reserves contributed by private companies operating their own blocks as silver lining. Overall reserves fell by more than 7 percent at the start of 2018 compared with a year earlier to total 8.483 billion barrels of crude oil equivalent (boe), according to data published on Friday by Mexico's National Hydrocarbons Commission (CNH). The vast majority of Mexico's proven reserves have been contributed by national oil company Pemex, which enjoyed a decades-long monopoly until a 2013 constitutional reform ended it, paving the way for private producers to enter the sector. But a relatively small amount of the reserves now reflect discoveries made by private and foreign oil companies."
Mexico oil reserves dip again as private firms begin to contribute
Reuters, 23 March 2018

"... in 2018 the UK has bought some liquid natural gas from Russia. Energy consultancy Wood Mackenzie said that this year the UK has imported three cargoes of Russian LNG from the Yamal gas project in northern Siberia. Murray Douglas, research director at Wood Mackenzie, said: "Each cargo provides around 0.1 billion cm of gas. UK gas demand so far in 2018 stands at 21.15 billion cm. So, direct Russian gas imports to the UK have accounted for 1.4% of total supply so far." A BEIS spokeswoman confirmed that Russian LNG was unloaded at the Isle of Grain terminal near Kent, and at the Dragon LNG terminal in south Wales. Consultancy firm McKinsey has said that the closure of the Rough gas storage facility in the North Sea means that the UK is more reliant on gas imports from overseas. In the early part of this decade, the UK's reliance on imported energy had an upward trend, according to the ONS, but then started falling. Net imports accounted for 36% of energy use in the UK in 2016, down from a peak of 48% in 2013."
Salisbury attack: How much of the UK's gas comes from Russia?
BBC, 18 March 2018

"Scientists have created the world’s first rechargeable proton battery, a crucial step towards cheaper and more environmentally-friendly energy storage. While the battery is just a small-scale prototype, it has the potential to be competitive with currently available lithium-ion batteries. The rechargeable battery, created by researchers at RMIT university in Melbourne, uses carbon and water instead of lithium. The lead researcher Professor John Andrews said that as the world moved towards renewables, there would be a significant need for storage technologies that relied on cheap and abundant materials....The battery itself produces no carbon emissions and it can store electricity from zero-emissions renewables. Andrews said it could be commercially available within five to 10 years. “When it is commercially available, it would be a competitor to the Tesla Powerwall and then eventually we’d hope we might find applications at the scale of the huge Tesla battery [in South Australia] and even larger.”"
Look, no lithium! First rechargeable proton battery created
Guardian, 9 March 2018

"The dream of nuclear fusion is on the brink of being realised, according to a major new US initiative that says it will put fusion power on the grid within 15 years. The project, a collaboration between scientists at MIT and a private company, will take a radically different approach to other efforts to transform fusion from an expensive science experiment into a viable commercial energy source. The team intend to use a new class of high-temperature superconductors they predict will allow them to create the world’s first fusion reactor that produces more energy than needs to be put in to get the fusion reaction going. Bob Mumgaard, CEO of the private company Commonwealth Fusion Systems, which has attracted $50 million in support of this effort from the Italian energy company Eni, said: “The aspiration is to have a working power plant in time to combat climate change. We think we have the science, speed and scale to put carbon-free fusion power on the grid in 15 years.” The promise of fusion is huge: it represents a zero-carbon, combustion-free source of energy. The problem is that until now every fusion experiment has operated on an energy deficit, making it useless as a form of electricity generation. Decades of disappointment in the field has led to the joke that fusion is the energy of the future – and always will be.  The just-over-the-horizon timeframe normally cited is 30 years, but the MIT team believe they can halve this by using new superconducting materials to produce ultra-powerful magnets, one of the main components of a fusion reactor. Prof Howard Wilson, a plasma physicist at York University who works on different fusion projects, said: “The exciting part of this is the high-field magnets.” Fusion works on the basic concept of forging lighter elements together to form heavier ones. When hydrogen atoms are squeezed hard enough, they fuse together to make helium, liberating vast amounts of energy in the process.However, this process produces net energy only at extreme temperatures of hundreds of millions of degrees celsius – hotter than the centre of the sun and far too hot for any solid material to withstand. To get around this, scientists use powerful magnetic fields to hold in place the hot plasma – a gaseous soup of subatomic particles – to stop it from coming into contact with any part of the doughnut-shaped chamber. A newly available superconducting material – a steel tape coated with a compound called yttrium-barium-copper oxide, or YBCO – has allowed scientists to produce smaller, more powerful magnets. And this potentially reduces the amount of energy that needs to be put in to get the fusion reaction off the ground.... The experimental reactor is designed to produce about 100MW of heat. While it will not turn that heat into electricity, it will produce, in pulses of about 10 seconds, as much power as is used by a small city. The scientists anticipate the output would be more than twice the power used to heat the plasma, achieving the ultimate technical milestone: positive net energy from fusion. Prof Wilson was also cautious about the timeframe, saying that while the project was exciting he couldn’t see how it would achieve its goal of putting energy on the grid within 15 years."
Nuclear fusion on brink of being realised, say MIT scientist
Guardian, 9 March 2018

"and are set to contribute nearly 50 per cent to the increase in the for oil over the next five years, the (IEA) said in its report on oil sector for 2018. According to IEA, demand is expected to grow at an annual rate of 1.2 million barrels per day (mbd) until 2023, as the would reach 104.7 mbd, up by 6.9 mb day from 2018. “As China’s economy becomes more consumer-oriented, the rate of growth in slows down to 2023, compared with the 2010-17 period. By comparison, the pace of growth will pick up slightly in India,” it says. The report says that though there is no peak in sight, the pace of growth will slow down to 1 mb per day by 2023 after expanding by 1.4 mb per day in 2018. “There are signs of substitution of oil by other energy sources in various countries. A prime example is China, which has some of the world’s most-stringent fuel efficiency and emission regulations. As the country recognises the urgent need to tackle poor air quality in cities, efforts are intensifying,” it adds.... is likely to tighten by 2023 with increased risk of price volatility. The market could go through two phases during the next six years. Through 2020, record supply from non-countries more than covers expected demand growth. By 2023, if investments remain insufficient, the effective global spare capacity cushion falls to only 2.2 per cent of demand and raises the possibility of oil prices becoming more volatile until new supplies come on line,” research agency said in its comments on the report. It added that there would still be a continued reliance on countries for a major share of global supply. “Within OPEC, more than 2 mbd of spare capacity is held in Saudi Arabia. In turn, this emphasises the crucial role OPEC’s largest producer continues to play in providing stability to global oil markets,” it said."
India, China to fuel 50% of rise in global oil demand in 5 years, says IEA
Business Standard, 8 March 2018

"The world could suffer an oil supply crunch by 2023, raising the risk of price spikes, because investment in exploration remains stubbornly low, experts have warned.Rising oil production from the United States will meet most of growing demand over the next three years, but after that markets could start to get much tighter, according to the International Energy Agency.In its annual oil market outlook, Fatih Birol, the agency’s executive director, said that investment in exploration and production still showed “little sign of recovering from its plunge in 2015-16”. He said that this “raises concerns about whether adequate supply will be available to offset natural field declines and meet robust demand growth after 2020”.”
‘Crunch is looming’ for oil supplies
Times, 6 March 2018

"Russia and Pakistan are negotiating potential energy deals worth in excess of $10 billion, according to Pakistani energy officials. ....Russia last month appointed an honorary council in the Pakistan’s northern Khyber Pukhtunkhwa province, where its companies are in talks to build an oil refinery and a power station.But the biggest deals focus on gas supply and infrastructure to Pakistan, one of the world’s fastest growing liquefied natural gas (LNG) import markets.“On a strategic basis, Russia is coming in very fast on the energy side,” said a senior Pakistani energy official.In October, Pakistan and Russia signed an inter-governmental agreement (IGA) on energy, paving the way for Russian state-giant Gazprom to enter negotiations to supply LNG to Pakistan.The talks are expected to conclude within three months and Gazprom is considered “one of the front-runners” to clinch a long-term supply deal, according to the Pakistani official. Based on two monthly LNG cargo deliveries, that deal would be worth about $9 billion over 15 years, he added.There is also growing confidence that a gas pipeline due to be built by Russia, stretching 1,100 km (680 miles) from Lahore to the port city of Karachi, will go ahead.US sanctions against Russian state conglomerate Rostec, as well as a dispute over North-South pipeline transport fees, have held up the $2 billion project since it was signed in 2015.The North-South pipeline would be the biggest infrastructure deal by Russia since early 1970s, when Soviet engineers constructed the Pakistan Steel Mills industrial complex."
With gas and diplomacy, Russia embraces Cold War foe Pakistan
The Nation, 6 March 2018

"Oil production growth from the United States, Brazil, Canada and Norway will more than meet global oil demand growth through 2020, the IEA said, adding that more investment would be needed to boost output after that.Non-OPEC production is set to rise by 5.2 million bpd by 2023 to 63.3 million bpd with the United States alone accounting for nearly 60 percent of global supply growth.Production in 2017 rose by 670,000 bpd as drillers added 200 rigs, “beating all expectations”, the IEA said.Output from OPEC producers will grow at a much slower pace, the IEA said, adding it expected Venezuelan production declines to accelerate, offsetting gains in Iraq. Birol said Venezuela’s production outlook may need to be cut in coming years as well.As a result, OPEC’s crude oil capacity will grow by just 750,000 bpd by 2023, the IEA said.With shale and other non-OPEC supply rising, demand for OPEC crude plus withdrawals from inventories will average 31.8 million bpd in 2019, the IEA said, 1.8 million bpd less than its last medium-term forecast.This is lower than demand of 32.3 million bpd expected in 2018 and below the IEA’s latest estimate of OPEC’s production of 32.16 million bpd.With forecast capacity of 36.3 million bpd, OPEC will be supplying less than 35 percent of global demand by 2023 compared to its historic share around 40 percent.Boosted by economic growth in Asia and a resurgent U.S. petrochemicals industry, global oil demand will increase by 6.9 million bpd by 2023 to 104.7 million, according to the IEA.Despite steep non-OPEC oil production gains, the IEA warned that a decline in mature fields meant more investment was needed across the globe after 2020.“Upstream investment shows little sign of recovering from its plunge in 2015-2016, which raises concerns about whether adequate supply will be available to offset natural field declines and meet robust demand growth after 2020,” it said."
IEA sees U.S. oil output surge stealing OPEC share in next five years
Reuters, 5 March 2018

"Russia’s oil and gas condensate production will grow in the next few years, peak in the early 2020s and then begin to fall due to the sanctions and the industry’s taxation scheme, the International Energy Agency (IEA) said in an oil market report.... In 2017, Russia hit a record oil output of nearly 11 million barrels per day despite its participation in a production cut agreement between OPEC and non-OPEC states. According to the agency,  further growth is possible in the next few years if restrictions envisaged by the agreement are lifted and new projects are launched."
IEA: Russia’s oil output to reach its peak in 2020
Vestnik Kavkaza, 5 March 2018

"Canada will continue to pump out more barrels from the oilsands over the next few years, but delays to pipeline approvals and uncertainty over the provision of more export capacity is undermining the next wave of development, according to the International Energy Agency. In its annual five-year oil forecast published Monday, the IEA warned that Canadian oil pipeline constraints are part of a wider capacity crisis brewing across North America. “Colossal growth in North American supply from 2018 to 2023 raises the crucial question of whether there is enough pipeline capacity to transport and sell all of that oil,” the Paris-based agency said in a report. “If sufficient capacity is not built, the increase in production we foresee could be at risk, with serious implications for global markets.” Despite the pipeline shortages, Canada will be among the countries leading growth in oil output over the next few years, taking its overall production to 5.6 million barrels per day by 2023, compared to 4.8 million bpd this year.... While supply from non-OPEC countries will more than cover expected demand growth till 2020, the situation could become more acute by 2023, if investments remain insufficient and effective global spare capacity cushion falls to only 2.2% of demand, the lowest number since 2007. “This raises the possibility of oil prices becoming more volatile until new supplies come on line,” the IEA said."
Pipeline shortage could choke North America’s oil supply with ‘serious implications for global markets’, IEA warns
Financial Post, 5 March 2018

"The U.S. may take over as the world's leading oil producer this year and continue to dominate crude growth for at least the next five years, the the International Energy Agency said Monday. The problem is that global energy investments outside of U.S. onshore shale aren't keeping pace with worldwide oil demand growth trends and crude shortages could eventually emerge, said IEA Executive Director Fatih Birol while speaking at the CERAWeek by IHS Markit conference in downtown Houston. Oil and gas spending internationally is yet to rebound from the 2014 bust in oil prices. "Are we seeing enough (global) investments to provide the boosts?," he said. " Our answer is absolutely not." The world isn't going to hit peak oil demand in the next few years, so more investment in production is needed, especially since about 3 million barrels a day are taken offline each year from as mature fields dry up, he said. The U.S. projected to add more than 3.5 million barrels a day through 2023, the IEA said. Brazil, Canada, Norway, Iraq and Iran also are increasing production, but much more slowly, although some of that is offset by declines in Venezuela and other nations. The IEA isn't projecting much crude production growth from the Organization of the Petroleum Exporting Countries in part because of agreement to limit production to help boost global oil prices."
U.S. shale leading oil growth as rest of the world falls behind
Houston Chronicle, 5 March 2018

"While the United States is indeed exporting 1.5 million barrels per day of crude oil overseas (9% of U.S. crude oil consumption), a development enabled by the lifting of the crude oil export ban in late 2015, we are still importing 7.6 million bpd (47% of U.S. crude consumption). This makes the United States still a net importer of crude oil. Even accounting for U.S. net exports of petroleum products (3.5 million bpd in November, 2017), the United States remains a net importer of crude oil and petroleum products overall. And we will continue to be so for at least the next several years, even under the most optimistic production forecasts....For now, what the shale boom has done is substantially reduced our net imports of crude oil, from roughly 66% of U.S. consumption ten years ago to 38% by November, 2017. This decrease means that the overall U.S. economy will be less sensitive to oil price shocks than it was in the past—such as the 1973-1974, 1979-1981 and 1990 oil price shocks that are associated with U.S. recessions.The net effect of an oil price shock is to shift money from oil consuming countries into oil producing countries. So when net imports were 10 million bpd ten years ago, a one dollar increase in the price of oil meant that an additional $10 million would be going out the door every day. The decrease in U.S. net imports substantially blunts this impact.”
U.S. Shale Boom Has Led To Big Payoffs, But Energy Independence Isn't One -- Nor Should It Be
Forbes, 5 March 2018

"The US will dominate oil production growth over the next two years, keeping the market well supplied, but a crunch could loom after 2020 if investment into future global output fails to keep up with rising consumption, the International Energy Agency said.Crude prices above $60 a barrel, prompted by robust world demand for oil and output cuts from global producers led by Opec and Russia, have spurred a second wave of production growth from US shale companies.These producers, which are more efficient than before the oil market crash in 2014, will help US output grow by 3.7m barrels a day by 2023 — more than half of the world’s total growth, the Paris-based body said in its five-year oil market outlook.The agency revised higher its US output estimates by more than 2m b/d compared with last year’s report. The US, together with Brazil, Canada and Norway, will ensure supply growth meets rising consumption over the next two years with total supply outside of the Opec cartel expected to reach 63.3m b/d in 2023.But the IEA said a pullback in spending on exploration and production since the price crash could be “storing up trouble”. A recovery in investment has “barely started” and the world is at risk of a shortage in extra production capacity.“Upstream investment may be inadequate to avoid a significant squeezing of the global spare capacity cushion by 2023,” the IEA said. “With global demand rising steadily, the response from the supply side is crucial.”The ability to produce additional barrels in the event of a supply shock is important and without sufficient spending, the amount of extra capacity on hand could drop to just over 2 per cent of demand — the lowest since 2007.For decades the world has relied on Opec countries, particularly the cartel’s de facto leader Saudi Arabia, to provide this security. The kingdom hold’s the largest share of the world’s spare capacity at more than 2m b/d.“This emphasises the crucial role Opec’s largest producer continues to play in providing stability to global oil markets,” the IEA said.The report comes as the industry debates whether a more resilient US oil industry will be able to deliver production growth robust enough to meet rising demand in the coming years, keeping a ceiling on prices.The US is expected to surpass Saudi Arabia and could rival Russia as the world’s biggest producer, disrupting an oil order in place for decades.But the IEA said US oil alone would not be enough and the amount of oil required from Opec producers was expected to rise to 34.1m b/d, up from 32.3m b/d in 2018.Every year the world must replace another 3m b/d of production, which is lost because of declining output rates from mature fields. It also must meet demand growth driven by an expanding global economy led by India and China.The agency says that a peak in total oil demand is not in sight, but growth may slow to 1m b/d by 2023 from 1.4m b/d this year. Total demand is forecast at 104.7m b/d in 2023.
IEA warns of oil supply crunch after 2020
Financial Times, 5 March 2018

“A global energy watchdog says booming production in the United States will meet 80 percent global growth in demand for oil over the next five years.The International Energy Agency believes slow growth from OPEC will be offset by oilfields in the U.S.The group, based in Paris, issued its annual oil market report on Monday. The resurgence in U.S. production is the most prominent change since the group's last forecast.The retreat by oil producers during an oil-price plunge between 2014 and 2016, however, continues to raise the specter that not enough money has been spent on exploration, which can result in shortages and price spikes. The IEA predicts that within five years, the cushion of production capacity over expected demand will fall to its lowest level since 2007."
US oil expected to meet most of world's growth in demand
Associated Press, 5 March 2018

“Last month, an engineer at a small power company in Solihull took a call from National Grid. A large gas plant had failed. Could the engineer’s company, UK Power Reserve, start up one of its small gas power units to help?Without standing up, the engineer sent a text message asking for one of UKPR’s 20MW plants to be fired up. Two minutes later, the plant, a series of gas engines in green containers, each with its own chimney, was up and running.A few hours later, the large gas power station was back on line and UKPR turned off its unit.The episode showed how small, flexible power plants are now bridging the supply gaps, especially at a local level, between intermittent renewables and Britain’s fleet of large, but slow-to-fire-up, gas and coal plants.Although they only generate small amounts of power, these mini units are cheap to build at around £5m for a 6MW plant and nimble to operate. They are increasingly valuable at times of peak demand, such as during last week’s extreme weather, or when the wind does not blow or the sun does not shine.Proponents of renewable power, which accounted for just over 29 per cent of the UK’s electricity generation last year, argue that battery storage will help smooth out the peaks and troughs.Sceptics say there will always be a need for baseload generation, large gas or nuclear plants, to ensure the country’s energy security.And in between, there is likely to be a growing need for low-cost, rapid-response power that can fill in close to where it is needed. “There is a strong need for flexible generation in the GB power market given the continuing growth in intermittent renewables,” said Simon Virley, head of Power & Utilities at KPMG and a former government energy adviser.The amount of such distributed generation, in terms of installed capacity, has almost doubled in the past six years; it accounted for just 15 per cent of installed capacity in 2011 but rose to 27 per cent or 26GW in 2016, according to National Grid figures.Lucrative government subsidies have been a big driver behind the growth of the industry, which also includes diesel-powered generators and storage.The government’s latest capacity auction last month, through which companies bid for subsidy contracts to deliver power at peak times, saw small new gas plants among the big winners.UKPR secured 200MW of gas-fired power capacity in the auction. The contract wins will boost the company’s generating capacity past the 1GW mark, equivalent to the output of two large-scale combined cycle gas turbine plants but spread across 40 different sites.”
Mini power plants smooth out UK’s energy landscape
Financial Times, 4 March 2018

"OIL and gas production over the next three decades could be 2.8 billion barrels higher than previously anticipated.While crude oil production fell by 2.6 per cent between 2016 and 2017, a new report from the Oil and Gas Authority (OGA) said that last year production in the UK Continental Shelf (UKCS) had been “maintained at a level not seen since 2011”. The industry body has now revised upwards its projection for the North Sea over the period 2016 to 2050 to a total of 11.7 bn barrels of oil equivalent (boe).That is 2.8 bn boe higher than had been forecast before leading industry figure Sir Ian Wood produced a report on maximising yield in the North Sea in 2014.A new report on oil and gas production and expenditure from the OGA said the industry in the UK had produced 1.63 million boe a day in 2017.This was despite the closure of the Forties pipeline system in December, which was shut down for three weeks after a crack was discovered.Without this, production would have risen in 2017. Overall operating costs in the sector rose by 3 per cent in 2017 to £6.9 bn – although this was still 27 per cent lower than the 2014 high.However capital expenditure fell for the third year in a row, to £5.6 bn, and is expected to fall for the “foreseeable future”, the OGA said.The report stressed its projections were “best estimates rather than a definitive prediction of future UK production of oil and gas”, as future North Sea production was “dependent on a number of different factors”.But it said: “The future potential of the basin could be boosted further through investment, exploration successes and resource progression. The OGA is supporting this through emphasis on the revitalisation of exploration, the implementation of area plans and promoting the development and adoption of new technologies.”OGA chief executive Andy Samuel said: “The extra 2.8 billion barrels identified shows the future potential of the basin which could be boosted further through investment and exploration successes. 2017 continued to be a productive year and production levels are set to rise in 2018 as more new fields come on-line.”
North Sea set for oil boom as estimates are increased by billions of barrels
The National, 2 March 2018


"The International Energy Agency (IEA) doesn’t see crude oil production in the U.S. peaking before 2020, and output declines aren’t expected in the next four to five years, executive director Fatih Birol said Tuesday. Speaking to reporters in Tokyo, Birol said U.S. shale growth is moving at a very strong pace, which will lead the country to overtake Russia as the largest crude producer in the world, if not this year, “definitely next year.” Earlier this month, the IEA forecast the U.S. would overtake Saudi Arabia “soon” and Russia by year-end. That’s because all the indicators that suggest continued fast growth in the U.S. are in “perfect alignment,” with rising prices leading to more drilling, more completions, more production and more hedging, Kallanish Energy learns. “The growth in (oil) production is unprecedented, exceeding all historical records, even Saudi Arabia after production from the mega Ghawar field or Soviet gas production from the super Siberian fields,” Birol said last November. The U.S. Energy Information Administration estimates U.S. oil output will exceed 11 million barrels per day (MMBPD) by late 2018. Last November, volumes rose above 10 MMBPD for the first time since 1970."
U.S. oil production won’t peak before 2020: Birol
Kallanish Energy, 1 March 2018


"A novel approach to an energy storage device run on an aqueous electrolyte can go from flat to fully-charged in just 20 seconds, making it perfect for portable electronics that frequently need a quick boost.While the concept isn't new, previous attempts have resulted in devices that suffer from low power and short working lives.We ask a lot of power storage tech these days. Not only must it be compact, powerful, long-lasting, and quick to recharge, it also has to be environmentally friendly. Oh, and preferably not blow up if you happen to chew on it.For those and other reasons, aqueous storage devices – those that contain water-based solutions rather than a mush of toxic or flammable organic paste – have gained some serious attention as safe and reliable options.Although less flammable than modern lithium batteries and potentially a whole lot cheaper, the way the solution carries electrons introduces a serious problem.The cells that make up a battery work by transferring electrons between two materials. Aqueous solutions limit the voltage range between the two points more than other solutions, resulting in the anode being eaten away faster.That makes for a poor life span and low amounts of power – not exactly great for reliably pushing your latest smart device through the day.So researchers at Korea Advanced Institute of Science and Technology (KAIST) have put a new spin on the system, modifying the way a device called an aqueous hybrid capacitor (AHC) is constructed.Hybrid capacitors such as these are essentially a mix of battery and capacitor – with electrodes that store their power electrochemically as an electrostatic charge. Adding an aqueous solution of ions inbetween can help carry the current.By using graphene-based polymers instead of more traditional metallic conductors on the anode, and making the cathode with a scattering of metaloxide nanoparticles, the researchers were able to overcome the shortfalls of previous AHCs.The web of tiny carbon fibres on the anode turns out to be far more efficient at transferring electrons into the aqueous solution, allowing for batteries with more than 100 times the power density than previous devices while still sustaining capacity for over 100,000 charges.Better yet, the new anodes coupled with liquid electrolytes mean the whole thing can go from zero to 100 perfect with just 20 seconds of charging.All of this is at no cost to its safety or economics."This eco-friendly technology can be easily manufactured and is highly applicable," says chemist Jeung Ku Kang."In particular, its high capacity and high stability, compared to existing technologies, could contribute to the commercialization of aqueous capacitors."Since the power source doesn't need to be a strong one, its rapid rate of charging might see it couple up neatly with photovoltaic cells or other micro-generating power sources.It'll be a while before we see these kinds of devices outcompete the likes of lithium ion batteries, but cheap cells that can handle extreme conditions without catching fire will no doubt find a place in future portable technology.The low charge time is just an added bonus, though we've been promised charge-while-you-wait batteries for years now.The wonder-material graphene is keeping our hopes alive, with Samsung exploring its potential in materials that might see a smart phone being fully loaded with power in about 12 minutes.
This New Kind of Battery Can Be Fully Charged in Less Than 30 Seconds
ScienceAlert, 1 March 2018

The United States will overtake Russia as the world’s biggest oil producer by 2019 at the latest, the International Energy Agency (IEA) said on Tuesday, as the country’s shale oil boom continues to upend global markets.IEA Executive Director Fatih Birol said at an event in Tokyo the United States would overtake Russia as the biggest crude oil producer “definitely next year”, if not this year.“U.S. shale growth is very strong, the pace is very strong … The United States will become the No.1 oil producer sometime very soon,” he told Reuters separately.U.S. crude oil output rose above 10 million barrels per day (bpd) late last year for the first time since the 1970s, overtaking top oil exporter Saudi Arabia.The U.S. Energy Information Administration said early this month that U.S. output would exceed 11 million bpd by late 2018. That would take it past top producer Russia, which pumps just below that mark.Birol said he did not see U.S. oil production peaking before 2020, and that he did not expect a decline in the next four to five years.The soaring U.S. production is upending global oil markets, coming at a time when other major producers – including Russia and members of the Middle East-dominated Organization of the Petroleum Exporting Countries (OPEC) – have been withholding output to prop up prices.U.S. oil is also increasingly being exported, including to the world’s biggest and fastest growing markets in Asia, eating away at OPEC and Russian market share.Meanwhile, U.S. net imports of crude oil fell last week by 1.6 million bpd to 4.98 million bpd, the lowest level since the EIA started recording the data in 2001, reflecting further erosion in a market OPEC has been relying on for decades.Birol said production growth was not just strong in the United States.“Canada, especially the oil sands, and Brazilian offshore projects. These are the two major (non-U.S.) drivers,” he said.On the demand side, Birol said the IEA expected growth of around 1.4 million bpd in 2018."
U.S. to overtake Russia as top oil producer by 2019 at latest: IEA
Reuters, 27 February 2018

"Venezuelan President Nicolas Maduro promised on Saturday to recover 70 percent of the country's lost oil production in the first half of 2018. "I can tell you, the unprecedented injustices led to an important fall of a million barrels of oil," Maduro said in an interview with state television without giving more specific figures or defining a time period for the output decline. "I think that in the first half of this year, we will have recovered 70 percent of production," he said. Venezuela's oil production dropped by nearly 13 percent last year according to figures released by OPEC in January, hitting a 28-year low that suggested a deepening economic crisis and increased chances of a debt default. Venezuela produced 2.072 million barrels per day (bpd) in 2017 compared with 2.373 million bpd the previous year, registering a near 300,000 bpd drop. Maduro has criticized an "economic war" led by the United States as well as corruption in the state oil company PDVSA for shrinking production."
Venezuela's Maduro says to recover 70 percent of oil output decline
Reuters, 25 February 2018

"Russia remained the top crude oil supplier to China in January, data showed, beginning 2018 on a strong note after the start-up of an expanded trans-Siberia pipeline and as Beijing released more crude import quotas to independent refiners. Angola and Iraq took the second and third positions for the month, leapfrogging Saudi Arabia, which was the second-largest supplier to China in 2017. Russian supplies came in at 5.67 million tonnes, or 1.34 million barrels per day (bpd), up 23.4 percent from a year earlier, data from the Chinese General Administration of Customs showed on Saturday. The January number compared with 1.194 million bpd in December. Last month, data showed Russia notched up its second year as China’s largest supplier in 2017, surpassing Saudi Arabia - OPEC’s top exporter - by some 150,000 barrels each day. The strong Russian exports to the world’s largest crude oil buyer came as a second East Siberia-Pacific Ocean (ESPO) pipeline, as well as expanded domestic connections in China, started commercial operation in January. In a reshuffle of the pack, Angola ranked second with 4.68 million tonnes, or 1.1 million bpd, of crude in January, down 5.4 percent from a year earlier."

Russia remains China's top oil supplier as pipeline expands
Reuters, 24 February 2018

"Global demand for crude is likely to "plateau" during the late 2030s, mostly because of the rise of electric cars and trucks, BP predicted Tuesday in its annual outlook. BP thinks 320 million electric vehicles will be on the road by 2040, compared with about 2 million in 2016. The company thinks electrics will hit a tipping point and really take off after 2035. The prediction is more evidence of a dramatic shift in appetite for oil. And talk of peak oil demand — from one of the world's largest oil producers, no less — shows how the thinking in the energy market has been upended. A decade ago, people were worried about the opposite problem — a peak in how much oil could be pumped out of the ground. Those fears briefly sent prices skyrocketing as high as $147 a barrel.....  "BP's forecast for "plateauing" oil demand by 2040 differs from OPEC's view of the future. In November, the oil cartel led by Saudi Arabia predicted that the global appetite for crude would keep growing through 2040. But even OPEC conceded that oil demand would "decelerate steadily" due to slower economic growth, higher oil prices, energy efficiency and "strong competition from other energy sources." Another oil giant, Royal Dutch Shell (RDSA), has predicted peak oil demand could come within 15 years. "The key takeaway is no one has any idea. It's impossible to pin down when we're going to reach peak oil demand," said Matt Smith, director of commodity research at ClipperData. A major factor will be the transformation of the auto industry, oil's No. 1 customer. Electric vehicle sales, led by the likes of Tesla (TSLA) and the Chevrolet Bolt, have soared in recent years. But electrics still make up just 0.2% of the total number of passenger vehicles, according to the International Energy Agency. Still, automakers like Ford (F), Volkswagen (VLKAF) and Honda (HMC) have announced ambitious electric vehicle sales goals. That push has been aided by a crackdown in Europe on the internal combustion engine. Norway, France, Germany and the U.K. have all announced efforts to phase out vehicles powered solely by fossil fuels. BP has become much more bullish on electric cars over the past year. The oil company now expects 190 million electric vehicles will be on the road by 2035, compared with about 2 million today. Last year's BP annual outlook called for a much more modest 100 million electric vehicles in 2035.By 2040, BP expects oil to contribute to 85% of total transportation fuel demand, compared with 94% today. BP anticipates alternative fuels will "penetrate the transport system" and traditional vehicles will become vastly more efficient, meaning they will guzzle much less gasoline. BP acknowledged that future electric vehicle popularity is "hard to predict with any certainty" because it depends on factors like government policy, technology and social preferences. Unlike their American counterparts, big European oil companies are increasingly putting their money where their mouths are by betting on electric cars. Last year, Shell purchased NewMotion, one of Europe's largest electric vehicle charging providers. The acquisition is a "form of diversification," Shell's vice president of new fuels told CNNMoney at the time. More recently, BP placed a $5 million wager on FreeWire, a maker of mobile rapid charging systems for electric vehicles. BP even said it would roll out FreeWire's charger units at certain gas stations in Europe during 2018."
BP: Demand for oil could peak by late 2030s
CNN, 20 February 2018

"Germany regards the Nord Stream 2 gas pipeline as an economic project that does not threaten the European Union, said German Chancellor Angela Merkel. "We are also for energy diversification. We also want Ukraine to continue to have transit gas traffic, but we believe Nord Stream poses no danger to diversification," Merkel said at a joint news conference after meeting with Polish Prime Minister Mateusz Morawiecki. The Polish Prime Minister objected to Merkel, stating " I do not agree…that Nord Stream 2 means diversification because the gas comes from the same source, just through a different route." According to Morawiecki, he spoke in favor of extending the regulations of the EU's Third Energy Package to Nord Stream 2 at the meeting with Merkel. Merkel said that Poland and Germany are continuing negotiations on this issue. In late January, Germany allowed Nord Stream 2 AG (the project operator company) to begin construction of the offshore section of the gas pipeline in the country’s territorial waters. Germany also approved the construction of a receiving terminal. Nord Stream 2 AG has said that procedures for obtaining permits in the other countries along the pipeline route - Russia, Finland, Sweden and Denmark - are on schedule."
Merkel: Nord Stream 2 pipeline does not threaten EU energy security
UAWire, 17 February 2018

"A rise in energy efficiency led to the biggest drop in UK electricity consumption in three years for EDF, the French state-backed energy giant said today. Both domestic and commercial customers cut their electricity usage in 2017, leading to an overall drop of 1.9pc, while gas consumption fell 2.6pc as milder weather meant customers used their central heating less.  Domestic energy use has been in decline nationally since 2010, despite a growing population and consumers using an increasing number of electrical appliances. Successive regulations in recent years, such as the phasing out of incandescent light bulbs, have forced appliance manufacturers to make their products less wasteful.Iain Miller of Northern Powergrid, the electricity network that supplies homes and businesses in the North East and Yorkshire, said: “Things are becoming more efficient. The modern TV will use less power when it’s running than a cathode ray tube did on standby.” Average energy consumption by fridges and freezers plunged by more than half between 1990 and 2016, according to official statistics, while “wet appliances” such as washing machines and dishwashers have improved more moderately.  Mr Miller suggested an increase in people eating out was also likely to have knocked domestic use."
UK energy consumption falling, says EDF as profits slip
Telegraph, 16 February 2018

"Russia’s oil production in the Arctic will reach peak levels in the 2020s, head of the state commission on natural resources Igor Shpurov said. Over 2017, he said, Russia produced in the Arctic about 76 million tonnes of oil, and the production would be growing to 2026 hitting a record of 122 million tonnes a year. “We forecast that by the mid-2020s, oil production [a year] in the Arctic zone will reach about 120 million tonnes,” he told a plenary session of the international Arctic summit in St. Petersburg. The oil production will grow due to Gazprom Neft’s developing of the Messoyakha field (Russia’s northernmost field in the Yamalo-Nenets Region – TASS) and also due to Gazprom’s growing production at the Prirazlomnaya pad – Russia’s first project on the Arctic shelf; as well as due to other projects, he explained. About 24% of the Arctic deposits have been explored and developed, he continued. “Thus we have remaining 76% of oil, which may be produced in future.”"
Russia’s oil production in Arctic may hit peak in 2020s
Hellenic Shipping News, 16 February 2018

"The rise in global oil production, led by the United States, is likely to outpace growth in demand this year, the International Energy Agency said on Tuesday. The Paris-based IEA raised its forecast for oil demand growth in 2018 to 1.4 million barrels per day, from a previous projection of 1.3 million bpd, after the International Monetary Fund upped its estimate of global economic growth for this year and next. Oil demand grew at a rate of 1.6 million bpd in 2017, the IEA said in its monthly market report.  However, the rapid rise in output, particularly in the United States, could well outweigh any pick-up in demand and begin to push up global oil inventories, which are now within sight of their five-year average. "Today, having cut costs dramatically, U.S. producers are enjoying a second wave of growth so extraordinary that in 2018 their increase in liquids production could equal global demand growth," the IEA said. "In just three months to November, (U.S.) crude output increased by a colossal 846,000 bpd and will soon overtake that of Saudi Arabia. By the end of this year, it might also overtake Russia to become the global leader." U.S. crude output could reach 11 million bpd by the end of this year, according to estimates from the U.S. Energy Information Administration.The Organization of the Petroleum Exporting Countries, along with other exporters such as Russia, have agreed to maintain a joint restriction on crude supply for a second year running in 2018, to force inventories to drain and support prices. Oil inventories across the world's richest nations fell by 55.6 million barrels in December to 2.851 billion barrels, their steepest one-month drop since February 2011, the IEA said. For 2017 as a whole, inventories fell by 154 million barrels, or at a rate of 420,000 bpd. By the year-end they were only 52 million barrels above the five-year average, with stocks of oil products below that benchmark, the IEA said. "With the surplus having shrunk so dramatically, the success of the output agreement might be close to hand. This, however, is not necessarily the case: oil price rises have come to a halt and gone into reverse, and, according to our supply/demand balance, so might the decline in oil stocks, at least in the early part of this year." Oil production outside OPEC nations fell by 175,000 bpd in January to 58.6 million bpd, but was still 1.3 million bpd higher than January last year, predominantly because of the 1.3-million-bpd year-on-year increase in U.S. output. OPEC output was largely steady at 32.16 million bpd in January and compliance with the supply deal reached 137 percent, due in part to declines in Venezuela, where economic crisis has paralysed much of the country's oil production capacity. The IEA estimates demand for OPEC's crude in 2018 will average 32.3 million bpd, after dropping to 32.0 million in the first quarter of the year. The IEA said oil prices, which briefly touched a high of $71 a barrel in January, could be supported even if U.S. production rises, provided global growth remains strong, or if unplanned supply outages persist."
IEA: Surge In Global Oil Supply May Overtake Demand In 2018
Reuters, 13 February 2018

"Venezuela is increasingly turning to its ally Russia for crude oil, as a dramatic fall in its crude output is pushing the country to import crudes for its refineries. State-owned PDVSA is resorting to importing Russian Urals crude for its 335,000 b/d Isla refinery in the Caribbean island of Curacao as the country's production has fallen to its lowest in almost two decades...Russia has been a strong ally to the Latin American country through these difficult times by continuing to bailing out PDVSA. This comes as the OPEC member finds itself in a crumbling financial state as falling oil production plunges the country into economic chaos. The country which relies heavily on crude oil export revenues has seen its domestic refining runs falls sharply due to underinvestment amid a lack of crude to process. Despite being a significant crude oil producer and the holder of the world's largest crude reserves, the country has been increasingly importing crude oil in the past few years. This imported crude is either used as a diluent in its extra heavy oil fields in the Orinoco Basin or used by its refineries which have been struggling to operate at normal rates due to the ongoing economic situation....Venezuela has observed a staggering decline in its crude oil production in the past 12 months as its oil sector has been plagued by spiraling debt, mismanagement, corruption, crumbling infrastructure and a lack of investment, Venezuela's output fell to 1.64 million b/d, a fall of 370,000 b/d since January last year, according to S&P Global Platts OPEC Survey data. This is a low not seen since its oil industry was hit by a major strike from December 2002 to February 2003. Not counting strike-affected months, Venezuela's production was last this low in June 1988, almost 30 years ago. Venezuela's output has fallen for six straight months, and analysts say more declines are likely unless the financial environment in the country improves drastically."
Venezuela turns to ally Russia for crude oil imports
Platts, 12 February 2018

"Over a half of university students are turning off their heating in a bid to save money – a new report by the National Union of Students has found.The ‘Homes Fit for Study 2018’ report looked at students in rented housing and found that 59% of students are limiting the amount of time they have the heating on to save money. The study also revealed that 49% of students reported feeling uncomfortably cold in their home, and that 38% of students have damp or mould in their property. The report comes in the wake of rising fuel bills – including a recent increase from British Gas which raised electricity prices by 12.5%, pushing the average annual dual fuel bill up by 7.3%."
More than 50% of students limit their energy usage to save money, report finds
The Linc, 9 February 2018

"A pilot project to turn 10 homes in Nottingham into net-zero emission properties without residents even moving out is nearing completion. Developer Melius Homes and social landlord Nottingham City Homes have worked together on the scheme, with UK solar manufacturer Viridian Solar providing photovoltaic roofing. The upgrades also include better insulated outside walls and upgraded heating systems. After the refurbishment, tenants will pay an energy services fee instead of paying for gas and electricity. With this guaranteed additional income, to which savings on planned maintenance costs are added, the landlord can borrow enough money to fund the upfront costs."
Net-zero Nottingham homes near completion
Energy Live News, 9 February 2018

"The EIA published its latest Short-Term Energy Outlook, in which it drastically revised its forecast for U.S. oil production, predicting the country will hit 11 mb/d by the end of 2018, a year earlier than it previously thought. In fact, the latest weekly survey estimates that U.S. oil production already jumped to 10.25 mb/d in the first week of February. Surging output threatens to push down oil prices further. The EIA sees Brent averaging $62 per barrel in 2018, and WTI to average $58."
Oil Prices Fall Below $60 On Renewed Shale Threat
Oilprice.com, 9 February 2018

"A total of 74.24GW entered the Capacity Market auction – which pays power plant operators to make backup electricity available at short notice – out of which 67.9% were successful.....  Last week, operators of the Eggborough coal-fired power station in Yorkshire announced the plant will be shut down after failing to secure new supply contracts for delivery in 2018/19, which cleared at £6/kW.Gas power plants accounted for the lion’s share of the agreements at 29.6GW, followed by nuclear at 7.9GW and interconnectors, which were included in the auction for the first time, at 4.6GW. Coal took a hit, with only 2.56GW of the total share, pumped storage stood at 2.5GW while battery storage accounted for only 153MW. The auction closed at £8.40/kW per year. The results will remain provisional until confirmed by Energy Secretary Greg Clark. Energy and Clean Growth Minister Claire Perry said: “Getting the best deal for energy billpayers is central to our Industrial Strategy and the Capacity Market is helping to drive competition, protect customers and ensure security of supply. “Today’s record low cost of £8.40/kW ensures that we have enough energy to provide homes and businesBritain has secured 50.41GW of backup electricity capacity for delivery in 2021/22."
Gas and nuclear lead in UK power capacity auction
Energy Live News, 9 February 2018

"With China having overtaken the US to become the world's largest oil importer in 2017, experts forecast a marginal increase in 2018 with a cyclical peak possible in 2020 or shortly thereafter. China surpassed the US, the former No.1 crude importer, in annual gross crude oil imports in 2017, importing 8.4 million barrels per day (bpd) compared with 7.9 million bpd for the US, according to a report by the US Energy Information Administration (EIA) published on Monday.  The EIA said that the increase in imports was mainly due to added refinery capacity and strategic stockpiling, coupled with shrinking domestic oil production.  Given the expected decline in China's crude oil output, the EIA report forecast China's crude imports will likely continue to rise over at least the next two years. Jin Lei, an associate professor at the China University of Petroleum, said last year's 10 percent increase was the result of relatively stable global crude prices. Customs data showed that 2017 crude oil imports stood at 420 million tons. "With global crude prices likely to move up to about $60 per barrel, the rise in China's crude imports will be held to less than 10 percent but the overall trend of growing will not change this year," Jin told the Global Times on Tuesday. As to when China's crude imports will peak, Jin said "soon." "Probably [a peak will appear] at sometime after 2020, due to the possible mass use of new-energy cars and hybrids, rising consumption of natural gas and expanded use of other alternative energy sources such as renewables," Jin said. Jin said it is difficult to predict at this time whether China's crude oil imports will remain at a plateau after 2020 or increase again. "In the long run, if alternative sources don't materialize as predicted, and demand continues to rise, crude imports will keep growing," Jin said. However, Chen Ruibi, chief energy analyst at Shanghai-based Hicend Futures Co, said that there is "no way" China's oil imports will peak in the short or medium term. "Despite some successes, China's economic restructuring could not be done overnight. The near-term needs of development mean that China can't escape its reliance on traditional energy sources, of which crude oil plays a major role," Chen told the Global Times.... China's reliance on imported crude in 2017 represented 67.4 percent of its demand, the report said. It also said the net import crude volume will be 423 million tons in 2018, up 6.7 percent from 2017. "
China becomes world’s largest oil importer
Global Times, 6 February 2018

"The UK installed more than half of the new offshore wind power capacity in Europe last year. The region built 13 new offshore wind farms in 2017, a total of 3.1GW, out of which the UK installed 1.7GW. It was followed by Germany, with capacity totalling 1.3GW, according to latest statistics from WindEurope. The total capacity in Europe now stands at 15.8GW, with a further 11 projects in the UK and Germany expected to boost capacity to 18.7GW. Offshore wind is projected to grow to a total installed capacity of 25GW by the end of the decade. The average size of new turbines also increased to 5.9MW – a 23% rise on 2016. CEO Giles Dickson said: “A 25% increase in one year is spectacular. Offshore wind is now a mainstream part of the power system and the costs have fallen rapidly. Investing in offshore wind today costs no more than in conventional power generation. “It just shows Europe’s ready to embrace a much higher renewables target for 2030. 35% is easily achievable. Not least now that floating offshore wind farms are also coming on line.”"
UK installed more than half of Europe’s offshore wind last year
Energy Live News, 6 February 2018

"The Dutch government Thursday appeared poised to meet demands to halve production at Europe's biggest gas field, as dozens of farmers mounted tractors to protest damaging earthquakes in the region. Economics Minister Eric Wiebes said he wanted to cut output in the northern Groningen gas field "as soon as possible" to a new recommended level of 12 billion cubic metres.  But first he said he wanted to discuss the issue with neighbours France and Germany, hoping to make a decision next month. Dozens of Groningen farmers meanwhile arrived in The Hague with their tractors to protest against fracking, as MPs debated the issue in parliament. The drama came as the Dutch mine safety board urged the government Thursday to take drastic action, seeking to halt the earthquakes which have plagued the region for years. "A major intervention is necessary in order to properly meet the safety standard and to reduce the risk of damage," the board said. Although no-one can predict when earthquakes will happen in the northern region, "we advise the minister to reduce the gas production as soon as possible to a maximum production level of 12 billion cubic metres per annum." This would be well below the current gas production of some 21.6 billion cubic metres, which was set in April 2017, and was already drastically scaled back from 53.9 billion cubic metres in 2013. Residents have increasingly called for all gas production to be halted in the region. "All our homes are falling apart," Annemarie Heite, 47, told AFP as she joined other farmers with their tractors at a protest close to the parliament, adding the problem had been "ignored for the past five years by our government." "These are man-made quakes and combined with the clay soil we have in Groningen everything is falling apart, our cultural heritage, our farms, our churches and eventually also the people." The low magnitude earthquakes are said to result from huge air pockets left underground because of gas extraction. But tempers rose after more than 900 homes were damaged in early January when Groningen province was hit by a 3.4-magnitude quake -- its largest since 2012. "Farmers are usually not protesters. They stay at home. But if their businesses are being ruined, you go bankrupt," Harm Wiegersma, from the Dutch dairy farmers union, told AFP. "This is a clear call for help from farmers," he added. Gasunie, which transports gas in the Netherlands and northern Germany, said however such a radical cut in Groningen gas risked leaving homes without heating next winter.....  Last year, a total of 18 quakes measuring 1.5 magnitude or higher were measured in the Groningen gas field, according to the Royal Dutch Meteorological Institute (KNMI). Top officials from ExxonMobil, NAM and Shell met MPs late Thursday and vowed that thousands of compensation claims for damage to homes and businesses would be paid. "NAM is financially robust," said Marjan van Loon, chief executive of Shell Netherlands. "All the bills will be paid," she stressed, adding Shell and ExxonMobil would discuss how the costs would be divided up. On Wednesday, the Dutch government announced it was setting up a new independent commission next month to assess all claims.  It will handle some 6,000 outstanding claims filed before March last year, as well as another 8,000 registered since then.  The aim is to have as many claims as possible settled by July, with the government then claiming the money back from NAM."
Dutch farmers protest fracking as govt set to cut gas output
AFP, 1 February 2018

"There have been varied reports regarding the effectiveness of security for smart grids. For example, some experts claim smart grids are at risk of cyber attack, while the National Cyber Security Centre’s (NCSC) technical director Ian Levy says: “Components of the smart metering system all interact in planned ways in order to contribute to the overall security of the system.” Rather than replacing the existing energy network, smart grids build on the existing power grid communication protocols – which already have a number of known vulnerabilities – as well as adding new communications networks to the transmission and distribution grid. “Any additional communication with existing infrastructure offers more doors to attackers to hack into the power grid,” says Zoya Pourmirza, a postdoctoral research associate at Newcastle University. There have been recent incidents where the power supply from a conventional power grid has been interrupted. One of the most recent was when multiple regional distribution power companies in Ukraine were hacked in December 2015, resulting in substations being switched off and tens of thousands of people left without electricity. ... attackers can be broadly subdivided into these categories: * Terrorists attacking another country by switching off the power grid. * Rogue states manipulating the energy market to destabilise the country. * Criminals monitoring power usage to determine when homes are empty. There is also the potential for corporations to manipulate the billing systems of their competitors, which is an attack type more likely to be carried out in some nation states than others. The network infrastructure of smart grids will now incorporate connections by anyone involved in the energy sector, from communication service providers to price comparison websites. Any of these could potentially, and inadvertently, provide an unauthorised access point into a smart grid."
How secure are smart energy grids?
ComputerWeekly, January 2018

"BP has announced the discovery of two new oil and gas fields in the North Sea, which should enable the company to double production within the next two years. The company also believes the discoveries should mean that North Sea production will be able to continue beyond 2050. The discoveries of the Capercaillie field in the central North Sea, which contains light oil and gas condensate, and the Achmelvich field, west of Shetland, which contains oil only, were made last summer and BP is now evaluating the results amid reports that one of the fields is the largest ever found in the North Sea. BP said it believed the finds should enable production from the area to double to 200,000 barrels a day by 2020. The company BP has spent billions in recent years developing new fields while selling off mature assets on the UK Continental Shelf amid falling oil prices. Mark Thomas, BP North Sea regional president, said, “These are exciting times for BP in the North Sea as we lay the foundations of a refreshed and revitalised business that we expect to double production to 200,000 barrels a day by 2020 and keep producing beyond 2050."
BP North Sea finds ‘set to double oil production’
Relocate Magazine, 31 January 2018

"Peak oil demand may be just 12 years away. That’s according to Bank of America Merrill Lynch analysts including Peter Helles, who predict that 40 percent of all car sales will be electric vehicles by 2030, reducing the need for oil as a fuel for transport. “Electric vehicles will likely start to erode this last major bastion of oil demand growth in the early 2020s and cause global oil demand to peak by 2030,” the analysts wrote in an emailed report. Despite strong global oil consumption helping to push crude prices higher, the rise of electric vehicles is seen as one of the biggest long-term threats to demand. Most oil companies see demand peaking around 2040, while Royal Dutch Shell Plc has said it expects to see demand peak in the early 2030s. Consultancy Wood Mackenzie said late last year that it expects oil demand growth to crawl, but not peak, by 2035, forcing major energy companies to shift from oil to natural gas and chemicals."
BofA Sees Oil Demand Peaking by 2030 as Electric Vehicles Boom
Bloomberg, 22 January 2018

"The U.S. is well-placed to overtake the likes of Saudi Arabia and Russia as the world's leading energy producer over the next 12 months, according to the latest monthly report from the International Energy Agency (IEA). 'This year promises to be a record-setting one for the U.S.,' the IEA said in its closely-watched report published Friday. 'Relentless growth should see the U.S. hit historic highs above 10 million barrels a day (in production), overtaking Saudi Arabia and rivaling Russia during the course of 2018 — provided OPEC and non-OPEC restraints remain in place,' the Paris-based organization added. The latest monthly report from the IEA comes at a time when crude futures have climbed to highs not seen since the early days of a slump in December 2014. Brent crude futures hit a peak of $70.37 a barrel on Monday, with the global benchmark since paring some of its recent gains to trade at $68.69 on Friday morning. "What we are trying to understand is the responsiveness of the U.S. shale producers. And because of the dynamism of the industry, the innovation and the vast number of players in that space … to some extent, we are in unchartered waters," Neil Atkinson, head of the oil industry and markets division at the IEA, told CNBC on Friday. Atkinson said that given the recent rally in oil prices, the IEA was expecting a "wave of new production" from the U.S. in the coming months. He added OPEC would then need to "accommodate" for that and make its own judgment at its next meeting in June as to what its response should be. The main price driver has been a supply cut from major oil producing group OPEC and Russia, who started to withhold output in January last year. The production cuts by OPEC and 10 other allied producers, which are scheduled to last throughout 2018, are aimed at clearing a supply overhang and propping up prices. One of the main beneficiaries of these cuts is the producers' major competitor, U.S. shale oil. U.S. oil producers are staging a dramatic comeback amid a recovering oil price that has allowed many of them to restart operations.  U.S. crude production stands at 9.9 million barrels a day, according to the IEA, which is the country's highest level in almost 50 years. That level of supply puts the U.S. neck-and-neck with OPEC kingpin Saudi Arabia — the world's second-largest producer after Russia. "The stage was set for a strong expansion last year, when non-OPEC supply, led by the U.S., returned to growth of 0.7 million barrels a day and pushed up world production despite OPEC and non-OPEC cuts," the IEA said. "U.S. growth of 0.6 million barrels a day in 2017 beat all expectations, even with a moderate price response to the output deal as the shale industry bounced back — profiting from cost cuts, stepped up drilling activity and efficiency measures enforced during the downturn," the group said. In recent years, America's unprecedented oil and gas boom has been driven by one factor above all others — and that's shale. The so-called shale revolution could help to alleviate Washington's reliance on foreign oil, including from turbulent Middle Eastern states, while also supporting a bid to export to more countries around the world. The IEA's estimates of global oil product demand in 2017 and 2018 were left roughly unchanged at 97.8 million barrels a day and 99.1 million barrels a day, respectively."
‘Relentless’ growth could see the US topple Russia, Saudi Arabia as world’s largest oil producer, IEA says
CNBC, 19 January 2018

"UK house-holders can slash their domestic energy bills by up to 66 per cent by turning their homes into mini-power stations, claims Japanese car giant Nissan.  Excess energy collected via solar panels on sunny days and stored in a fridge-sized home-battery during off-peak times could be sold back to the national grid at peak times when demand for it is at its highest.  The system would also make it cheaper for green householders to charge up their electric cars, the manufacturer said.The firm unveiled its move into the wider energy market during the international launch of is new second-generation all-electric battery-powered Leaf car in Tenerife.The Japanese car giant is also pioneering a system that use the energy stored in an electric car's battery – while it is parked up unused at home – to help power homes and domestic appliances, or be sold back to the grid when the vehicle is not in use. It is also using reconditioned electric car batteries to store power for villages in Africa. ...The Nissan Energy Solar system starts from £3,881 which includes the supply and installation of a six-panel solar system. The Leaf is priced from £21,990 to £27,490."
Home energy bills can be slashed by up to two thirds by adapting electric car battery technology for houses, claims Nissan
This Is Money, 19 January 2018

"American crude oil output is set to rise by 1.8 million barrels per day from the nation’s largest shale producing areas over the next year, according to new forecasts by the U.S. Energy Information Administration (EIA). Just next month, national output will climb up 111,000 bpd. The Drilling Productivity Report, which tracks production from the seven most prolific basins in the US, also said production in January should touch 6.438 million barrels per day, which is 24,000 bpd higher than December levels. The 1.8 million-jump equals the volume of production cuts sustained by the Organization of Petroleum Exporting Countries and several allied nations, including Russia, who have agreed to contribute to the global market rebalancing plan. So far, prices have risen steadily through 2017 after a year of indecision in 2016, but the international plan is set to expire in December 2018, with members conducting an official review of the deal in June."
EIA: Shale Oil Output To Rise By 1.8 Million Bpd Through Q1 2019
OilPrice.com, 17 January 2018

"Investment in clean energy plunged further in Britain than in any other country last year because of government policy changes, new figures show. The amount companies spent on green energy in the UK rose during the years of the coalition government (2010-2015) but has now fallen for two years in a row under the Conservatives, according to analysis by Bloomberg New Energy Finance (BNEF). While investment in wind, solar and other renewable sources slumped by 56% to $10.3bn (£7.5bn) in the UK, worldwide spending climbed 3% to $333.5bn (£242.4bn), the second-highest level on record. Alan Whitehead, shadow energy minister, said: “The government’s green rhetoric is nothing more than empty promises. Their ideologically-driven policy lurches away from clean solar power and onshore wind has spooked investors. “Whilst saying they have ambitions to be a green government their actions point in the opposite direction with renewables support slashed at the same time that fracking has been given the go ahead.”  Caroline Lucas, Green party co-leader, said the UK figures were damning.China led the global charge, with investment jumping by nearly a quarter to $132.6bn, a new high. The amount of solar installed in China increased by more than three-quarters on the year before as costs fell. Worldwide, solar took the lion’s share of spending on renewables, at $160.8bn, followed by windfarms. Jon Moore, chief executive of BNEF, said: “The 2017 total is all the more remarkable when you consider that capital costs for the leading technology – solar – continue to fall sharply.”  Investment increased by 1% to $56.9bn in the US, the second-biggest market for clean technologies, despite the Trump administration’s efforts to favour coal and nuclear power. However, spending also fell in Germany, Japan, India, Norway, Turkey and Taiwan. The fall of 56% in the UK was the steepest decline, far out-stripping the decrease of 26% for Europe as a whole. Around half of the UK spend, $4.8bn, was a final investment decision by Ørsted of Denmark on a single huge offshore windfarm, the Hornsea 2 project off the Yorkshire coast...“What’s needed when we hear from investors and developers is more transparency from the government. When you compare the Netherlands and Germany there’s more transparency up to 2030 on [wind power] capacity through competitive auctions,” said Keegan Kruger, wind analyst at BNEF. Kruger added that he expected the trend in UK investment to continue downwards until around 2020, when it would likely stabilise because of new investments in offshore windfarms."
UK green energy investment halves after policy changes
Guardian, 16 January 2018

"According to a forecast from the U.S. Energy Information Administration (EIA), oil production in the U.S. should average 10.3 million BPD this year, an increase of 1 million BPD from just last year. The International Energy Administration (IEA), likewise, sees U.S. oil output rising to about 10 million BPD this year. That forecast makes it "possible that very soon US crude production could overtake that of Saudi Arabia and also rival Russia's," according to the IEA, assuming both countries hold to their current agreement to keep a lid on output in support of higher oil prices. Much of this oil is already on its way, according to the EIA, which expects U.S. drillers to increase production from the top shale plays by 1.5% this month and another 1.7% in February. That's a big-time uptick considering that output from these regions has been mainly flat for the past several months due to lower oil prices last summer. However, with crude roaring higher since then, and recently in the $60s, producers in the country have the cash to drill more wells."
America First: The Country Is About to Become the Leader in Global Oil Production

Motley Fool, 20 January 2018

"The United States is afraid of fair competition in the energy sector, and is hampering the implementation of the Russian Nord Stream 2 gas pipeline project, according to Russian Foreign Minister Sergey Lavrov.“There is reprisal in the energy sector against North Stream 2. It is the US which is calling it politicized, leading to a split in Europe, and the strangling of Ukraine,” he said at a press conference on Monday. “Washington clearly forces Europeans to abandon Nord Stream 2, despite the fact that gas deliveries to Germany via the pipeline could be 2,000km shorter than through Ukraine, and the cost of transit could be halved,” said the Russian diplomat. Europeans “are being forced to buy much more expensive liquefied gas from the United States instead of Russian gas,” Lavrov added. He also said that the US could not withstand fair competition from Russia in the gas-export sector. Russia plans to build the Nord Stream 2 natural gas pipeline under the Baltic Sea to Germany, and to double the existing pipeline's capacity of 55 billion cubic meters per year. The project has faced fierce resistance from some EU members, especially from the Baltic states and Poland. They say the pipeline will cut gas transit through Ukraine and will result in a Russian monopoly in the EU gas market. Other countries like Austria, Hungary and Germany are in favor of buying Russian gas."
US forcing Europe to abandon Russian gas & buy more expensive American LNG - Lavrov
RT, 15 January 2017

"In its final editorial of peak oil demand series, Wood Mackenzie looks at the consequences of peak oil demand on gas, noting that it sees a growth to 2035. As explained, many oil majors are talking about reshaping their supply portfolio towards gas, in response to concerns about peak oil demand. As countries succeed in achieving the nationally determined contributions (NDCs) they pledged at Paris COP21, global gas demand will grow at an average rate of 1.6% through to 2035, according to Massimo Di Odoardo, Vice President, Gas Research. In North America, low gas prices are enabling displacement of coal in the power sector. In Europe, government and utilities are announcing plans to retire coal fired plants. In China, plans are in place to more than double the share of gas in the energy mix. And with the price of liquefied natural gas (LNG) increasingly cheaper than that of oil, emerging markets are looking at LNG as a way to switch to gas"
Global gas demand to grow at 1.6% rate through to 2035s
Green4sea, 13 January 2017

"America’s trade imbalance just got a wee bit smaller. The U.S. has now become a net exporter of natural gas on an annual basis for the first time since at least 1957. Net exports averaged about 0.4 billion cubic feet per day last year, flipping from net inflows of 1.8 billion in 2016, according to Victoria Zaretskaya, a Washington-based analyst for the U.S. Energy Information Administration. The numbers will be officially released by the agency in a report Thursday, she said.  A “significant projected increase” in natural gas sent by pipeline to Mexico and a growing number of liquefied natural gas shipments to the rest of the world should guarantee the trend moving forward, Zaretskaya said by email on Wednesday. Now the U.S. has a single LNG export facility operating, Cheniere Energy Inc.’s Sabine Pass terminal in Louisiana. Two others are slated to start this year.  “Never before has the global LNG market had such significant flexible LNG volumes as the volumes coming online in the next three years, mostly from the U.S., which will lead to a fundamental shift in how LNG is marketed and traded globally,” Zaretskaya said."
US Becomes a Net Gas Exporter for the First Time in 60 Years
Bloomberg, 11 January 2017

"WTI for February delivery was at $61.59 a barrel on the New York Mercantile Exchange, up 15 cents, as of 2pm in Seoul. Total volume traded was about 37 per cent below the 100-day average. Prices lost 57 cents to $61.44 on Friday. Brent for March settlement added 13 cents, or 0.2 per cent, to $67.75 a barrel on the London-based ICE Futures Europe exchange. Front-month prices rose about 1.1 per cent last week. The global benchmark crude traded at a premium of $6.19 to March WTI. US explorers spent the final six weeks of 2017 in a virtual standstill, adding just as many rigs as they laid off. Bowing to heightened investor pressure, drillers are seeking to do more with less in a bid to boost profits. Their money-saving moves include opening already-drilled wells by fracking them rather than deploying more rigs to start new ones."
Oil trades above $61 amid optimism that surplus is abating
Irish Times, 8 January 2018

"With characteristic flamboyance, the Trump administration has set in motion a grand scheme to lure energy companies to explore for oil and gas across virtually all of America's outer continental shelf, a deep marine domain encompassing billions of acres of ocean bottom. Drawing a distinction from the Obama administration's concerns about climate change and restricting offshore fossil energy development, Interior Secretary Ryan Zinke cast President Donald Trump's offshore drilling campaign as a study in American strength. "We're embarking on a new path for energy dominance in America," Zinke said. "We are going to become the strongest energy superpower. Yet like other marquee directives Trump has issued in the past year to empower the domestic fossil fuel industry, the offshore plan may not bear out its grand ambitions. Many energy analysts already are predicting that exorbitant costs, flat prices, civic opposition, climate concerns and new transportation technology make major new offshore drilling enterprises, at least outside the Gulf of Mexico, unlikely. Even in the Gulf, which produces 1.5 million barrels of oil daily, or 15 percent of U.S. production, the cost of exploration, permitting and operations in deep water is well over $1 billion per well, according to the American Petroleum Institute. Energy analysts also say it will take at least 10 years for a new well to begin producing in the Gulf, and twice that anywhere else on the outer continental shelf. By that time, according to industry forecasts, demand for oil will be well past its peak and dropping due to the advent of electric vehicles, more efficient engines for planes and ships and new materials that are not made with oil or natural gas."
Trump has big plans for offshore oil development; but will it ever happen?
Los Angeles Times, 8 January 2018

"Australia is expected to become the world's biggest natural gas exporter by next year as huge projects near completion. According to the latest quarterly resources outlook from the chief economist at the federal department of industry, innovation and science, the title is likely to be somewhat short-lived, however, as US exports ramp up over the following years. The report said Australia was likely to overtake Qatar as the biggest gas exporter, before the US assumes the mantle in the mid-2020's.... "Australia’s LNG export volumes are forecast to reach 77 million tonnes in 2018–19, up from 52 million tonnes in 2016–17," the report said. "Higher export volumes will be driven by increased production at Gorgon, as well as the completion of the three remaining LNG projects under construction — Wheatstone, Ichthys and Prelude." Qatar -- currently the world's largest exporter of natural gas -- exported 74 million tonnes in 2016, and volumes are expected to remain little-changed over the forecast period to 2019. Rising export volumes mean natural gas is set to become the second biggest Australian resources export by dollar value 2019, overtaking metallurgical coal. That increase will help pick up the slack from a projected $10 billion decline in iron ore -- Australia's biggest export -- based on reduced Chinese demand."
Australia is set to become the world's biggest exporter of natural gas by 2019
Business Insider, 7 January 2018

"The milestone means that, between them, nuclear and renewables generated more electricity in 2017 than all fossil fuels combined. Within this total, wind alone generated more than twice as much electricity as coal, supplying more power in every month except January. The UK electricity sector passed a string of other symbolic markers in 2017, from its first coal-free day since 1882 to new records for wind and solar generation. This lead NGO WWF to dub the year the “greenest ever” for electricity – with prime minister Theresa May tweeting her support. Nevertheless, power sector emissions remain far above what will be needed to meet legally-binding UK carbon targets, while progress in decarbonising the rest of the economy is limited. Last year, Carbon Brief’s analysis revealed that windfarms had generated more electricity than coal in 2016. This year’s analysis is based on a combination of data sources, chiefly half-hourly electricity generation data compiled by Dr Iain Staffell, lecturer in sustainable energy systems at Imperial College London, for the Electric Insights website. See the notes at the end for more on how the analysis was done. The most striking finding is that low-carbon sources, for the first time, supplied more than half the total. The share from nuclear and renewables has doubled between 2009 and 2017, to reach just a shade over 50.0%. Fossil fuels supplied 47.5% of generation in 2017, down from 75.4% in 2010. The lion’s share of today’s fossil supply is from gas, with coal generation having plummeted over the past five years (see below for more on this). The rise of low-carbon electricity supplies has been rapid, driven by subsidies for renewables. At the same time, electricity demand has been falling steadily, down another 1.7% last year. The government recently ruled out additional low-carbon subsidies in the medium term, beyond those already agreed or promised. However, rapid cost declines for renewables mean subsidy-free deployment might become increasingly possible, even if long-term contracts might still be needed. Over the past year, the largest increase in generation for a single source came from wind, which was up 31% to 49 terawatt hours (TWh) in 2017. The was due to capacity increasing by a fifth, but also due to more favourable wind speeds, up 7% in the first 11 months of the year.  However, nuclear remains the single largest source of low-carbon electricity in the UK – and the second largest source overall. It generated 70TWh in 2017, a figure that is virtually unchanged since the early 2000s, when a number of old reactors were closed down. The government hopes to secure new nuclear capacity to replace the remaining fleet, which is mostly due to close in the 2020s. However, progress has been slowed by financial problems at several of the firms hoping to build this new capacity and protracted talks over subsidies, or even more direct financial support from government. Meanwhile, plans to usher in a new generation of “mini nuclear” small modular reactors were recently set back after ministers deferred a decision on further funding and published a report suggesting such reactors would – at least initially – be more costly than their larger cousins. The other renewables also generated more in 2017 than in 2016. Solar rose 11%, on rising capacity, while biomass increased 4%. This is despite a fuel supply problem at Drax, the UK’s largest power station, which has converted half its capacity to burn wood pellets. It’s worth adding that the 31TWh of biomass electricity comes from a wide range of sources. Large sites burning wood, such as Drax, have become controversial, due to uncertainty over how long it will take for new, growing trees to offset raised carbon emissions at the power plant, particularly if trees are harvested exclusively to generate electricity. In a recent guest article for Carbon Brief, Prof Sir John Beddington, the UK government’s chief scientific adviser between 2008 and 2013, wrote: “A reasonable estimate [for this case] might be that every kilowatt hour of wood at least doubles the emissions over a period of 30 years that might otherwise occur even if the alternative were fossil fuels.” However, the likes of Drax supply only around three-fifths of the biomass electricity generated in the UK. The remainder is from smaller sites burning poultry litter, landfill gas or gas from anaerobic digesters, among other things. Notably, coal generation fell by a further 25% in 2017 to 23TWh, discussed in more detail below. Meanwhile, gas generation also fell, down 7% to 134TWh, well below its 175TWh output in 2010 . Nevertheless, gas was the single largest fuel by far, supplying some 40% of generation in 2017. Gas-fired electricity has direct emissions roughly half those from coal. Along with falling demand – down around 10% since 2010 – and the rise of renewables, gas-to-coal switching helps explain recent rapid reductions in the carbon intensity of UK electricity (grammes of CO2 per kilowatt hour). According to Electric Insight’s estimates, the carbon intensity of UK power fell by 10% to 237gCO2/kWh in 2017, half the 508gCO2/kWh in 2012. (Note that this estimate covers all electricity supplied in the UK, including imported power from France and the Netherlands. In 2017, the UK sourced 15TWh from imports, up from zero in 2010. Last year saw a slight decrease on 2016, after a raft of nuclear plants were taken offline in France for repairs.)  Despite having contributed to the recent decline in emissions from electricity generation, gas is still a fossil fuel, with direct emissions at the power plant of around 400gCO2/kWh. Indeed, given an overall intensity that is now well below that of gas, the UK power sector would become more carbon intensive if gas meets a larger share of the mix. Gas emissions are also some four times larger than the 100gCO2/kWh which the Committee on Climate Change (CCC) suggests will be needed by 2030, in order to help meet the UK’s legally-binding carbon targets. By implication, and combined with the government’s pledge to phase out coal power by 2025, the UK must generate no more than 25% of its electricity from gas by 2030. Indirect emissions in the gas supply chain, such as from leaking wellheads or pipes, impose additional constraints on the extent to which gas can continue to be part of the UK electricity mix – and the wider UK energy systemThe latest decline in coal-fired electricity generation in the UK completes an 84% fall over the space of just five years, between 2012 and 2017. The fall has been so dramatic that solar generated more electricity than coal on 182 of 365 days last year, with wind exceeding coal on 302 days. There were also 1,226 half-hour periods with zero coal generation, the equivalent of 25.5 days. There were 3 full days with zero coal, including the well-publicised first coal-free day since the industrial revolution, on 21 April, but also the 1st and 29th of October. Coal’s share of UK monthly generation  fell to a record low of below 2% in April, averaging 2% across the five months from April through August (see next section).  The leading protagonist in coal’s demise has been the UK’s top-up carbon tax, the carbon price floor. This has raised the carbon price for the power sector to around £23 per tonne of CO2 in 2017, increasing the cost of coal generation, relative to lower-carbon gas. At the latest budget, the government committed to maintain a steady carbon price for the power sector until coal has been phased out. The government has yet to set out how it will ensure its phaseout plans are guaranteed, if the carbon price and market conditions fail to do the job. It also remains committed to the capacity market, which keeping coal plants open as an insurance policy against insufficient electricity supplies. Other major factors in coal’s demise include EU air pollution rules, shifting wholesale prices for coal and gas, and the closure of three large coal plants in 2016. The 84% coal reduction over the past five years accounts for around 80% of the fall in overall UK carbon emissions over the same period. This highlights how little has been achieved in other parts of the economy, with transport emissions essentially unchanged since 1990, for example. While power sector emissions must fall furthest, CCC analysis suggests the UK will only meet its legally-binding carbon budgets with emissions cuts across the whole economy....Solar, obviously, generates the bulk of its annual output during the summer, while wind and hydro are more productive in the stormier winter months. These annual cycles are complementary, as the lower chart below shows. It’s worth adding that these seasonal variations remain relatively muted compared to the seasonal cycle of electricity demand, which rises in the winter months due to the need for extra heat and light. This cycle is clear in the output from coal, which rises in winter to match demand."
For the first time in 2017, more than half of the electricity generated in the UK came from low-carbon sources, Carbon Brief analysis shows
Carbon Brief, 3 January 2018

"The US oil rig count rose by 42 percent during 2017 compared to the corresponding period last year, as energy companies boosted spending. Drillers held the number of oil rigs steady for a second straight week at 747 in the week to Dec. 29. That was 222 more than the 525 rigs at the end of 2016.  There is much optimism across Texas regarding the prospects for the industry in the coming year.  The Permian Basin pumped an estimated 815 million barrels of crude in 2017, beating its previous record of 790 million barrels, achieved back in 1973. Over the past decade, the Permian has added almost 2 million b/d to US production, and by the end of this year, it could be producing 2.75 million barrels daily which will boost total U.S. oil production to more than 10.5 million barrels by the end of this year. There are some dark clouds on the horizon which could be a harbinger of trouble ahead and even the beginning of the end for the decade-long shale oil boom.  There is evidence that points to falling production in the Eagle Ford from some of the recently drilled shale wells. In the last few years, drillers have been able to increase the initial production from recently drilled wells by using “new technologies” such as longer laterals, using more sand during fracking, and more sophisticated staging. The success of these new practices gave the appearance that the shale oil industry had found ways to get more oil out of fracked wells. As the months of production ticked by, however, it is becoming apparent that the burst of higher production only lasts a few months and down the road two or three years, these “new technology” wells may not produce any more oil than it the pre-new technologies era. Moreover, the “new technology” wells cost more to drill and frack, leaving the industry back where it was. If this trend continues and the oil being extracted from a very limited number of “sweet spots” is ever exhausted, we could be facing declining US shale oil production within a few years. A recent Federal Reserve survey of 134 companies involved with shale oil production in the US southwest says that nearly all companies are saying that oil prices must stay above $60 a barrel for a substantial increase in drilling to occur. Even if US shale oil production continues to climb, it may not be enough to meet rising global demand for oil because of the large cutback in expensive conventional oil projects – mostly offshore.  Offshore megaprojects will take many years to come online. Some believe we could see output deficits and much higher prices as soon as 2019.... Only Americans have gotten shale right so far, but the Kremlin is taking the first steps to unlock Russia’s potential. Companies like Gazprom Neft are leading Moscow’s drive to replicate the US shale boom, experimenting with a uniquely Russian, state-controlled approach to fracking that contrasts with the free-for-all among independent producers in Texas and North Dakota."
Peak Oil Review
Resilience, 1 January 2018







".... if you look around and see what the world is now facing I don't think  in the last two or three hundred years we've faced such a concatenation of  problems all at the same time.....[including] the inevitability, it seems to me, of resource wars....  if we are to solve the issues that are ahead of us, we are going to need to think in completely different ways. And the probability, it seems to me, is that the next 20 or 30 years are going to see a period of great instability... I fear the [current] era of small wars is merely the precursor, the pre-shock, for something rather larger to come... we need to find new ways to be able to live together on an overcrowded earth."

Paddy Ashdown, High Representative for Bosnia and Herzegovina 2002 -2006
BBC Radio 4, 'Start The Week', 30 April 2007

"Individual peace is the unit of world peace. By offering Consciousness-Based Education to the coming generation, we can promote a strong foundation for a healthy, harmonious, and peaceful world.... Consciousness-Based education is not a luxury. For our children who are growing up in a stressful, often frightening, crisis-ridden world, it is a necessity."
Academy Award Winning Film Producer David Lynch (Elephant Man, Blue Velvet, etc)
David Lynch Foundation






NLPWESSEX, natural law publishing
nlpwessex.org