Sindh will not have surplus gas from 2021 onwards: Pak Energy Minister
Pakistan Minister for Energy Omar Ayub Khan acceptance that Sindh will not have surplus gas from 2021 onwards and the province will not be able to meet its own demand from its production has revealed the crisis that awaits in the future. Dawn quoted Khan as saying that the country is currently facing a gas shortage of about 3.5 billion cubic feet per day. He was testifying before a panel of the parliament’s upper house. Khan further said that the gas load shedding would continue during the upcoming winter as the production of indigenous gas was decreasing while the demand was on the rise, reported Dawn. This revelation comes after Prime Minister Imran Khan had commented that the country has reached a “tipping point” after which it will see only success has fallen flat. He was speaking at the inauguration ceremony of Ravi Riverfront Urban Development Project. The Energy Minister’s statement has come amid Saudi Arabia’s strong stance against Pakistan. The decade-long friendship between both countries took a sharp turn when Pakistan Foreign Minister Shah Mehmood Qureshi issued a blunt warning to Saudi Arabia after the latter refused to act against India over Kashmir issue. As a retaliation, Saudi Arabia issued a statement that loans or oil supply will no longer be given to Pakistan. Islamabad was also made to pay back USD 1 billion to Riyadh, which was part of a USD 6.2 billion package announced by Saudi in November 2018, which included a total of USD 3 billion in loans and an oil credit facility amounting to USD 3.2 billion. The deals were then signed when Crown Prince Muhammed Bin Salman made a visit to Pakistan in February last year, the Middle East Monitor reported. Islamabad has been pushing for the foreign ministers’ meeting of the Organisation of Islamic Cooperation (OIC) since India abrogated Article 370, which gave special status to the erstwhile state of Jammu and Kashmir. After Pakistan failed to gather support from the OIC members on Kashmir on May 22, Prime Minister Imran Khan said, “The reason is that we have no voice and there is a total division amongst (us). We cannot even come together as a whole on the OIC meeting on Kashmir.”
Indian Lab Develops Technology to Convert Used Cooking Oil Into Biodiesel and Glycerine
India has been exploring alternatives to fossil fuels and trying to reduce its dependence on oil imports. One of the options being explored by the country is biofuel, made from various raw materials like waste plastics, used cooking oil, tree-borne oils and fats or oils from slaughterhouses, poultry farms, and fisheries. A state-funded Indian laboratory has designed a technology to convert used cooking oil in homes and restaurants into biodiesel and glycerine. The portable unit can be set up in every village in the country to help fuel self-sufficiency and generate revenue from glycerine for cosmetics and the pharmaceutical industry. Dr Anjan Ray, Director of the Dehradun-based Indian Institute of Petroleum (IIP) under the federal Science and Technology Ministry, told Sputnik, biofuel produced via this method would be less expensive than diesel. The scientist said one litre of used cooking oil could produce 900-950 ml of biodiesel. He added that glycerine output is about 10 percent. Dr Ray said a technology demonstration plant is already functioning at the Institute, while four or five trial units would be set in the states of Chhattisgarh, Uttar Pradesh, Uttarakhand, and the national capital Delhi by March next year in collaboration with IIP’s partner agencies. IIP had earlier launched the first of its kind technology to convert plastic waste to diesel. The demonstration plant has a capacity to convert 1,000 kilograms of plastic waste daily into 800 litres of diesel. The diesel is automotive grade, meets specifications for use in vehicles, and can be directly used to fuel cars, trucks, and power generators. The raw material used is polyolefin waste, which accounts for approximately 70 percent of total plastics consumed. IIP had also developed a technology to produce bio jet fuel, and the first commercial flight using a mix of bio jet fuel and aviation turbine fuel was operated between Dehradun and New Delhi in August 2018.
India’s weak fuel demand drags on as virus crisis worsens
India’s fuel demand dragged lower in July, posting its fifth consecutive year-on-year decline, government data showed on Tuesday as a spike in coronavirus cases and floods in many parts of the country restricted economic activity. Consumption of refined fuels, a proxy for oil demand, fell to 15.68 million tonnes in July, 11.7 per cent lower compared with a year earlier and 3.5 per cent below the prior month, data from the Petroleum Planning and Analysis Cell (PPAC) of the Ministry of Petroleum & Natural Gas showed. Diesel consumption, which accounts for about two-fifths of India’s overall fuel usage and is widely used for transportation as well as for the country’s irrigation needs, fell to 5.52 million tonnes last month from 6.31 million tonnes in June. On an annual basis, demand for diesel declined about 19.3 per cent. Sales of gasoline, or petrol, fell by 10.3 per cent from a year earlier to 2.26 million tonnes, and were down 0.8 per cent from 2.28 million tonnes in June. Demand for fuel was also impacted as higher retail prices dented demand in the world’s third-biggest oil consumer and as virus cases continue to explode. With over 2 million people infected with the novel coronavirus, India stands third with the most cases after the United States and Brazil. In addition, heavy rains and floods have affected millions of people and battered industrial and construction activity in some Indian states. India’s top refiner, Indian Oil Corp, said last month it would continue to operate its refineries below capacity in 2020/21, and that it didn’t see a recovery in demand to pre-COVID levels “in the near future.” Fuel consumption in India nearly halved in April as a nation-wide lockdown to curb the outbreak halted economic activity and travel. July naphtha sales fell 12.4 per cent to 1.28 million tonnes from a year earlier but rose 10 per cent from June. Sales of bitumen, used for making roads, slipped 4.4 per cent on an annual basis and about 45 per cent month-on-month.
Brookfield in talks to buy Cheniere’s stake from Blackstone – BBG
The infrastructure arm of Brookfield Asset Management Inc is in talks to buy Blackstone Group Inc’s minority stake in Cheniere Energy Partners , Bloomberg News reported on Tuesday, citing people familiar with the matter. Cheniere Energy Partners is a limited partnership formed by Cheniere Energy Inc, the biggest liquefied natural gas producer in the United States. Brookfield Asset Management is working with a partner to buy Blackstone’s interest, Bloomberg said, adding no final decision has been made and the alternative asset manager could opt to not proceed. Blackstone held 203.2 million shares, or about 58.3%, of Cheniere Energy Partners as of March 31, according to Refinitiv Eikon data. Blackstone declined to comment and Brookfield did not immediately respond to Reuters’ request for a comment.
Petronet says invoked force majeure on 9 cargoes
Petronet LNG Ltd (PLL), the country’s biggest gas importer, on Tuesday said it invoked the force majeure on nine cargoes after COVID-19 lockdown cut offtake by consumers. Petronet imports natural gas in its liquid form (LNG) from countries such as Qatar and Australia and pipes it to users such as power plants and fertiliser units after re-converting it into its gaseous state. Petronet invoked the force majeure on eight liquefied natural gas (LNG) cargoes of Qatar and one from Exxon for loading from March to May. “Due to a nationwide lockdown imposed by the Government of India from the last week of March 2020, the offtake of regasified-LNG (RLNG) from the Dahej terminal (in Gujarat) was reduced. “This decline in throughput was due to partial/full shutdown of a number of industries, refineries, power plants, etc, which reduced their offtake of natural gas as the demand of their respective products decreased,” Petronet said in a regulatory filing. Average gas send-out from the Dahej terminal fell to less than 60 per cent of the capacity in April, down from over 88 per cent in the previous month. “Post first week of June when the lockdown was relaxed, the demand of RLNG has seen gradual recovery and since then, PLL”s Dahej terminal is operating at its full capacity of 17.5 million tonnes per annum (63 million standard cubic meters per day),” it said. Before COVID 19, average send-out during January-February was around 58 mmscmd (92 per cent of the capacity) at the Dahej terminal and 3.57 mmscmd (20 per cent) at 5 million tonnes a year at the Kochi terminal in Kerala. “Owing to the COVID-19 pandemic and a consequent reduced RLNG demand during the lockdown period, PLL was constrained to invoke the force majeure for nine long-term cargoes with its suppliers and discussion on the same are ongoing,” the company said without giving details.
Hydrogen set to emerge as the next low carbon gas technology
Clean hydrogen has the potential to abate 37 percent of energy related greenhouse gas emissions, according to the Global gas report 2020 published by the International Gas Union, research company BloombergNEF and Snam, the Italian-headquartered international gas infrastructure company . The development of an international hydrogen market would require meaningful infrastructure investment and substantial policy decisions to accelerate adoption in long term. There are major opportunities to scale up the use of low carbon gas technologies post pandemic. However, this would require nations to abide by several prerequisites including including emissions pricing linked to clear, Paris-aligned long-term climate targets; harmonized standards governing hydrogen use; coordinated strategies regarding regional and global infrastructure roll-out, and the deployment of hydrogen-ready equipment, such as pipelines, gas turbines and end-use appliances. “While the economics are challenging today, a joined-up policy approach could unleash the investment needed to bring costs down, develop scalable business models and drive adoption across the hard-to-abate sectors,” explained Jon Moore, CEO of bloombergNEF. Potential Resources The report also noted that Germany, which is pursuing rapid development in Hydrogen, could procure cost competitive hydrogen at about $1/kg in 2050 from a variety of sources. Global gas demand has fallen by 4 per cent following the Covid-19 pandemic but the analysts believe that resulting low prices will promote further switching to gas and development of low carbon gas technologies.
Reliance deal going through due diligence: Saudi Aramco CEO
The mega deal for Saudi Aramcos$15 billion stake in the oil to chemicals business of Reliance Industries Limited (RIL) is going through due diligence and a decision will be taken after a review, Saudi Aramco CEO said on Monday. Amin Nasser, CEO, Saudi Arabian Oil Company commented on the status of the potential transaction with RIL in a post earnings call with analysts. “With regard to the Reliance deal, all I can say at this stage, it’s going through due diligence. So, depending on the due diligence, we will make our decision after we complete the due diligence on that deal,” Aramco CEO said. “This is a big deal. So we need to take our time to review and then decide based on the outcome of the due diligence study,” Nasser added. Speaking at the company’s annual general meeting in July, RIL Chairman, Mukesh Ambani had said the deal involving the world’s largest oil producer — Aramco picking up a minority stake in refinery business of RIL is on track as the two sides remain committed to a long term partnership. Speaking at the company’s first virtual annual general meeting, Ambani said that due to unforeseen circumstances in the energy market, the deal (with Aramco) has not progressed as per original timeline. In the meanwhile, company’s equity requirements have already been met. “Nevertheless, we at Reliance value our over two-decade long relationship with Saudi Aramco and are committed to a long-term partnership,” he said. The RIL and Aramco deal has been in the works for some time and doubts were raised on its early completion due to Covid-19 outbreak and lockdowns. The deal between Reliance and Aramco involves the Indian entity offering at least 20 per cent stake in a special purpose vehicle covering refining, petrochemicals and marketing. RIL board has already approved hiving-off its $75 billion O2C business into a separate entity. Ambani announced that the company will spin off its oil-to-chemical business into a separate subsidiary by early 2021 after regulatory approvals, and detailed plans of also moving into green energy space
US natural gas output, demand to fall due to coronavirus lockdowns, agency says
US natural gas production and demand will drop in 2020 and 2021 from record highs last year as coronavirus lockdowns cut economic activity and energy prices, the US Energy Information Administration (EIA) said on Tuesday. EIA’s Short-Term Energy Outlook (STEO) projected dry gas production will drop to 88.65 billion cubic feet per day (bcfd) in 2020 and 84.02 bcfd in 2021 from the all-time high of 92.21 bcfd in 2019. It also projected gas consumption would fall to 82.42 bcfd in 2020 and 78.71 bcfd in 2021, from a record 84.97 bcfd in 2019. That would be the first annual decline in consumption since 2017 and the first time demand has fallen for two consecutive years since 2006. EIA’s gas supply projection for 2020 in August was lower than its July forecast of 89.24 bcfd, while its latest demand outlook for 2020 was higher than its July forecast of 82.35 bcfd. The agency forecast US liquefied natural gas exports would reach 5.54 bcfd in 2020 and 7.28 bcfd in 2021, up from a record 4.98 bcfd in 2019. That is higher than its July forecasts of 5.35 bcfd in 2020 and 7.28 bcfd in 2021. US coal production is expected to fall 29 per cent to 502 million short tons in 2020, which would be its lowest level since 1963, before rising to 564 million short tons in 2021 when power plants are expected to burn more coal due to a forecast increase in gas prices, EIA said. It projected carbon emissions from burning fossil fuels will fall to 4.543 billion tonnes in 2020, the lowest since 1983, from 5.130 billion tonnes in 2019, the lowest since 1992, before rising to 4.798 billion tonnes in 2021 as coal use increases.