New base 556 special 09 march 2015

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,
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NewBase 09 March 2015 - Issue No. 556 Khaled Al Awadi
NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Solar Impuls 2 has taken off for first round-the-
world solar flight
The first attempt to fly around the world in a plane using solar energy has been launched this
morning from Abu Dhabi at 6:30 AM . Masdar ( UAE leading renewable energy hub & Institute )
has been selected for the project by its pilots, who said, this is a landmark journey aimed at
promoting green energy.
The takeoff of Solar Impulse 2, which was delayed on Saturday due to high winds, would cap 13
years of research and testing by Swiss pilots Andre Borhe schberg and Bertrand Piccard.

"This project is a human project, it is a human challenge," Borschberg, co-founder and chief
executive of Solar Impulse who will fly the plane on the first leg, told reporters on Sunday.
The wingspan of the one-seater plane, known as the Si2, is slightly bigger than that of a jumbo jet,
but its weight is around that of a family car. It will take off from Abu Dhabi on Monday at 6:30 a.m.
(0230 GMT), landing first in Muscat, Oman.
From there, it will make 12 stops on an epic journey sp read over five months, with a total flight
time of around 25 days. It will cross the Arabian Sea to India before heading on to Myanmar,
China, Hawaii and New York.
Landings are also earmarked for the Midwestern United States and either southern Europe or
North Africa, depending on weather conditions. The longest single leg will see a lone pilot fly non-
stop for five days across the Pacific Ocean between Nanjing, China and Hawaii, a distance of
8,500 kms (5,270 miles).
Borschberg and Piccard will alternate turns at the controls because the plane can hold only one
person. All this will happen without burning a drop of fuel.
"We want to share our vision of a clean future," said Piccard, chairman of Solar Impulse. "Climate
change is a fantastic opportunity to bring in the market new green technologies that save energy,
save natural resources of our planet, make profit, create jobs, and sustain growth."
The pilots' idea was ridiculed by the aviation industry when it was first unveiled. But Piccard, who
hails from a family of scientist-adventurers and was the first person, in 1999, to circumnavigate the
globe in a hot air balloon, clung to his belief that clean technology and renewable energy "can
achieve the impossible".
The plane is powered by more than 17,000 solar cells built into wings that, at 72 meters (236 feet),
are longer than a jumbo and approaching that of an Airbus A380 superjumbo. Thanks to an
innovative design, the lightweight carbon fiber aircraft weighs only 2.3 tons, about the same as a
family 4X4 and less than one percent of the weight of the A380.
The Si2 is the first solar-powered aircraft able to stay aloft for several days and nights. The

propellor craft has four 17.5 horsepower electric motors with rechargeable lithium batteries. It will
travel at 50-100 kms per hour, with the slower speeds at night to prevent the batteries from
draining too quickly.
The Si2 is the successor to Solar Impulse, a smaller craft that notched up a 26-hour flight in 2010,
proving its ability to store enough power in the batteries during the day to keep flying at night It
made its last successful test flight in the United Arab Emirates on March 2, and mission chiefs
reported no problems. It is scheduled to arrive back in Abu Dhabi in July,
For him, "the project should not finish
in July, it should start in July." A
petition was launched on
futureisclean.org to campaign in favor
of clean energy. The pilots will be
linked to a control center in Monaco
where 65 weathermen, air traffic
controllers and engineers will be
stationed. A team of 65 support staff
will travel with the two pilots. Its
progress can be monitored via live
video streaming at www.solarimpulse.com

ME oil and gas transaction activity subdued in 2014
by Oman Observer + NewBase
While the Middle East has substantial oil and gas reserves and production, in the context of the
global transactions market both current and historic levels of activity are relatively low, according
to EY’s Global Oil and Gas Transactions Review 2014. In the Middle East, transaction activity in
2014 was quiet and only upstream witnessed any deal activity.
David Baker, MENA Oil and Gas Transactions Leader, EY, says: “Prior to the drop in oil price in
the second half of 2014, oil price had been unusually stable over past the 3 years, largely trading
around $100-120/bbl despite some
major geopolitical events. When oil price
did dip, the speed and extent of the
price correction took many by surprise.
The industry has responded by making
a number of recent announcements
regarding projects and capital
expenditure cuts.
Globally we are expecting a
strengthening oil and gas M&A market in
2015 as companies reallocate capital to
optimise their portfolios, remove
underperforming and lower yield
businesses, and pursue opportunistic
acquisitions.”
In terms of timing, the drop in oil price is
expected to affect the industry in the
following order; oil field services,
exploration and production (E&P) then
midstream/downstream. Oil field services, beginning with entities aligned to discretionary CAPEX
(Seismic/Exploration), are likely to be affected first, followed by onshore drilling and then
development. E&P will also clearly be impacted, beginning with the highly leveraged E&P entities
and those with disproportionate exposure to high marginal cost production. On the other hand, the
price drop may be beneficial to midstream/downstream businesses. However, the businesses
embedded in integrated oil companies may come under further pressure to de-capitalise their
value chains.
From an upstream perspective, while the number of transactions decreased from 32 to 12 from
2013 to 2014, the total value was only marginally down at almost $600 million. In terms of the
upstream sector, Middle East transaction value relative to the total global upstream transaction
value represented less than 0.3 per cent in 2014, which is the lowest share over the past five
years. The deal activity was geographically spread over the Middle East region with countries
such as the UAE and Iraq being the locations of multiple transactions.
As is consistent with the past three years, no midstream transactions were completed in 2014.
This is a result of the very high level of state ownership of these strategically important assets and
therefore little, if any, availability in the market. Finally in the downstream sector, again, there were
no transactions in the Middle East which is against a backdrop of only very limited transaction
activity in 2012 and 2013.

Norway: Lundin Petroleum spuds exploration well on the
Morkel Prospect in the Northern North Sea. Source: Lundin Petroleum
Lundin Petroleum, through its wholly owned subsidiary Lundin Norway, announced March 4
that drilling of exploration well 33/2-2S in PL579 has commenced. The well will investigate the
hydrocarbon potential of the Morkel Prospect in PL579, which is located 180 km west of Florø
on the Norwegian west coast and approx. 40 km northwest of the Snorre field.
The main objective of well 33/2-2S is to test the hydrocarbon potential and reservoir properties of
the Jurassic section. Lundin Petroleum estimates the Morkel Prospect to have the potential to
contain unrisked, gross prospective resources of 74 million barrels of oil equivalent (MMboe).
The planned total depth is 3,500 metres below mean sea level and the well will be drilled using
the semi- submersible drilling unit Bredford Dolphin. Drilling is expected to take approx. 60 days.
Lundin Norway is the operator and has a 50 percent working interest in PL579. The partners
are Bayerngas Norge and Fortis Petroleum Norway with 30 percent and 20 percent working
interest, respectively.
According to information on the Lundin web site: The Morkel Prospect is located on a down-
faulted terrace of the Makrell/Penguin Horst. The reservoir units are Upper Jurassic Munin Mb of
the Draupne Fm and Magnus Fm analogues, as well as the Middle Jurassic Brent Gp. The
expected hydrocarbon type is oil. Change of Success is estimated at 21%.

Uganda: Tullow, Partners May Invest $14 Billion in Oil Fields
Bloomberg + NewBase
Tullow Oil Plc and its partners expect to invest as much as $14 billion developing oil fields in
Uganda, General Manager Jimmy Mugerwa said.
Tullow, an exploration company based in London, is working with Total SA of France and China’s
Cnooc Ltd. to develop fields that the government estimates contain 6.5 billion barrels of oil
resources. Crude production may begin as early as 2017 and is expected to reach 200,000
barrels per day by about 2020, according to the World Bank.
“With the partner companies, we are looking at $8 to $10 billion for the upstream and $3 to $4
billion when we start the pipeline construction,” Mugerwa said in an interview Thursday in Kigali,
the capital of neighboring Rwanda.
Uganda, where oil was discovered in 2006, announced last week it will sell its first round of
exploration licenses later this year after lifting a permitting moratorium that has been in place since
2007. Cnooc was the first company to be issued with a license, while applications for other
companies are still pending. Tullow expects to make a final investment decision for work in
Uganda by the end of 2015 or early 2016, Chief Executive Officer Aidan Heavey said in
November.
Six oil blocks are on offer in the so-called Albertine Graben, on Uganda’s border with the
Democratic Republic of Congo. More than 400 companies, both domestic and foreign, have
expressed an interest in the acreage during preliminary stages, Energy Minister Irene Muloni told
reporters on Feb. 24. Tullow, which has drilled 79 wells in Uganda, is evaluating the licensing
round, Mugerwa said. “The bids are still open, but right now, nothing is concrete,” he said.

Philippines: Supply shortages lead to rolling power outages
Source: eia + Platts World Electric Power Plant Database
As the 12th-largest nation in the world, the Philippines has a population of more than 100 million
people spread over 7,000 islands, presenting several electricity infrastructure challenges.
Currently, the country is facing growing concerns over resource adequacy in its power sector, as
the nation is challenged to add supply quickly enough to keep up with growing demand.
In late 2014, Philippine president Benigno Aquino requested emergency powers from the
Philippine Congress to enable the government to lease 600 megawatts (MW) of additional
capacity and to take other measures to prevent power outages in Luzon, the largest island region
in the southeast Asian nation.
Emergency capacity additions would be mostly met by diesel generators. Other emergency
measures include paying large customers to reduce grid demand by running their own generators,
under the government's interruptible load program. Supply concerns in Mindanao, the nation's
second-largest island region, have already led to recurring announcements of rolling power
outages. An announced outage in February 2015 was partly caused by acoal-fired power plant
undergoing preventive maintenance.
The nation's power sector has been through years of transformation. The National Power
Corporation (NPC) once had a monopoly on generation and transmission. Following political
regime change in 1986, the Philippine economy experienced a series of reforms, including electric
power sector restructuring. Executive Order No. 215(1987) led to the creation of an independent
power producer sector to spur private ownership of generation.
Additional emphasis on privatization and restructuring followed, culminating in the Electric Power
Industry Reform Act of 2001 (EPIRA), which required functional unbundling of NPC's generation
and transmission activities. The EPIRA also established a wholesale electricity spot market to
enable wholesale competition through merit-order dispatch of generators and market-based

pricing. On the retail side, distribution to customers traditionally was mainly through investor-
owned utilities, such as the Manila Electric Company (MERALCO). In 2013, the implementation
of retail competition and open access (RCOA) allowed qualified customers to choose alternate
electricity suppliers. Despite these restructuring efforts, the Philippines continues to face power
supply challenges, and Filipinos pay some of the highest electricity prices in southeast Asia—
issues that have been cited as risks to foreign investment.
In addition to the
government's short-term
emergency actions, the
Philippines will continue
to expand its electricity
generation capacity to
improve system
reliability and keep up
with economic and
population growth. The
most recent data
available from
the International Energy
Agency estimate that
70% of the population
has access to electricity.
The three main island
regions of Luzon,
Visayas, and Mindanao
each have distinct
generation profiles. In
the northern part of the
country, Luzon's
capacity is mainly powered by fossil fuels, with anticipated capacity additions of more than 500
MW, most of which will be coal-fired. Visayas, in central Philippines, currently relies heavily on its
geothermal resources, but has plans to add 300 MW of coal capacity by 2017. In the south,
Mindanao relies heavily on its hydropower resources, with plans for both additional hydropower
capacity and additional coal-fired generation to increase system reliability.

Turkey: Russia’s bid for Turkish Stream Gas Pipeline
Robin Mills + NewBase
,
Energy exports are a useful weapon, but one that can only be wielded only once. If Russia
persists with its latest move in the long drawn-out battle over Europe’s gas supply, it will open the
gates to the competition it has feared for the past decade and more.
Europe gets 30 per cent of its gas from Russia – still mostly transported through Ukraine, despite
the opening of a new pipeline under the Baltic directly to Germany. Previous cut-offs of gas
through Ukraine, most seriously in 2009, and the continuing conflict there, have made Russia look
for alternative routes.
But in December, it gave up on plans for South Stream – a line under the Black Sea to Bulgaria,
after legal objections from the EU. The Europeans were in no mood to make life easy for Russia’s
monopoly Gazprom while imposing sanctions on the country over its support for forces fighting
Kiev in eastern Ukraine.
Instead, Gazprom announced plans for an alternative route – Turkish Stream – under the Black
Sea to Turkey. From there, if Russian gas is to find its way to the main markets in central Europe,
then pipelines through the Balkans must appear from nowhere by 2019. The Gazprom chief
executive Alexei Miller said: “Now it is up to [our European partners] to put in place the necessary
infrastructure starting from the Turkish-Greek border.”
The EU has sought increasingly since 2009 to diversify its supplies, but has faced obstacles.
Environmental groups – funded by Russia, according to the Nato secretary general Anders Fogh
Rasmussen – have campaigned against shale gas, leading to moratoria in Romania (now lifted),
and in Bulgaria, which gets 87 per cent of its gas from Russia.

Meanwhile, Russia has been happy for the nuclear negotiations and sanctions on Iran to be
endlessly drawn out, preventing the country, according to BP the state with the world’s largest gas
reserves, from competing with it.
The Nabucco pipeline was meant to bring gas from the Middle East and Central Asia to Europe,
the so-called Fourth Corridor (the first three are the routes from Norway, North Africa and Russia).
But Nabucco lacked enough heavyweight backing from gas companies and EU institutions, and
never managed to secure enough gas supply.
Of its target countries, Iran was hit by sanctions and anyway struggled to produce enough gas to
meet domestic demand, while Iraq and its Kurdish region are still at an early stage of developing
gas for domestic use. Enigmatic Turkmenistan would have to build a pipeline across the disputed
Caspian Sea, through the territory of its competitor Azerbaijan, in the face of Russian disapproval.
But Turkish Stream opens the way to a revival of the Fourth Corridor. If the EU is compelled to
build expensive new gas pipelines from Turkey through south-east Europe, it can carry gas from
anyone. The bloc’s proposed Energy Union would create a more coherent energy policy, not
hostage to the vagaries of individual members. The small Balkan markets, currently dependent
almost entirely on Russian supplies, would be integrated into a pan-European network.
Turkey does not want to be over dependent on Russian gas either – it has devoted much effort to
diversifying its imports, with Azerbaijan and the Kurdish region of Iraq the best bets. In the longer
term, a post-sanctions Iran could become the Fourth Corridor’s largest supplier and a real
competitor to Russia in Europe.
Europe can find alternative suppliers. It is, in large part, the inertia of expensive infrastructure that
has slowed its quest so far. In contrast, Russia has no other customers that can replace Europe
for reliability and value. China is an important long-term market, but far away, expensive to reach
and already playing off Russian against Central Asian gas. If Turkish Stream unlocks the iron
gates of the Fourth Corridor, Russia will find it has itself brought about what it most feared.

US: petroleum product exports increase for 13th consecutive year, setting record
Source: U.S. Energy Information Administration
U.S. exports of noncrude petroleum products from the United States averaged a record 3.8 million
barrels per day (bbl/d) in 2014, an increase of 347,000 bbl/d from 2013, based on data from
EIA's Petroleum Supply Monthly. In particular, exports of motor gasoline, propane, and butane
increased, offsetting a decrease in distillate exports.
As detailed in This Week in Petroleum, the combination of record-high U.S. refinery runs (which
averaged 16.1 million bbl/d in 2014) and increased global demand for petroleum products allowed
U.S. petroleum product exports to increase for the 13th consecutive year.
These exports are mostly sent to nearby markets in Central America and South America, followed
by exports to other countries in North America (Canada and Mexico). U.S. petroleum product
exports increased in every region except the Middle East, which declined from 55,000 bbl/d in
2013 to 47,000 bbl/d in 2014. However, in 2014, there was more change—both in quantity
exported and destination—for specific products: motor gasoline, propane, butane, and distillate.
December 2014 exports of motor gasoline, which include finished gasoline and gasoline blending
components, set a monthly record of 875,000 bbl/d. For the past several years, monthly exports of
gasoline have been highest in November and December, as low seasonal U.S. gasoline
demand in December creates a larger surplus of gasoline, particularly on the U.S. Gulf Coast (as
defined by Petroleum Administration for Defense District 3), resulting in increased exports to
relatively farther destinations in Africa and Asia. Still, most U.S. motor gasoline exports are sent to
Canada and Mexico.

Increased U.S. production and capacity to export hydrocarbon gas liquids (HGL), particularly on
the U.S. Gulf Coast, allowed exports of propane and butane in 2014 to increase by 121,000 bbl/d
(40%) and 44,000 bbl/d (149%), respectively, over 2013 levels. Exports of propane to Asia,
particularly Japan and China, where the fuel is used in cooking, heating, transportation, and as a
petrochemical feedstock, nearly doubled in 2014 from 2013, increasing by 40,000 bbl/d (95%).
Exports of butane, which shares some uses with propane but is more suitable for use in warmer
climates, grew to 74,000 bbl/d. In 2014, the United States exported 20,000 bbl/d of butane to
Africa, an increase of 17,200 bbl/d (628%) from a year earlier, making Africa now the largest
recipient for U.S. exports of butane.
U.S. distillate exports declined for the first time since 2004. Almost all of this decrease is
attributable to declines in exports to Western Europe and Africa, where distillate exports fell by
61,000 bbl/d (15%) and 8,700 bbl/d (35%), respectively, in 2014. In the second half of the year,
increased European refinery runs, exports from recently upgraded Russian refineries, and new
refinery capacity in the Middle East increased supply to European distillate markets, reducing the
need for distillate from the United States.

Oil Price Drop Special Coverage
Kuwaiti oil minister warns crude price is tied to global economic recovery
with Reuters, AFP + NEwBase
A drop in shale oil production has triggered a bounce in global oil prices, but they will not rise
sharply as long as the world’s economy stays sluggish, said the Kuwaiti oil minister Ali Al Omair.
Many factors are affecting oil prices, including violence in Iraq and Libya, state news agency Kuna
quoted the minister as saying late on Saturday during a visit to Bahrain for an energy industry
conference. Reduction of output will not have a major impact without a global economic recovery
that would spur demand, he said.
He said projections showed prices might improve this year, but added that they might also stay
between US$50 and $60 per barrel. “Forecasts for the oil price this year indicate that it will gain or
at least stabilise between $50 and $60 a barrel,” Kuna quoted him as saying.
The minister said prices are currently supported by conflict in Iraq and Libya and by a drop in sand
oil and shale oil output. But that is counterbalanced by slow global economic growth, which is
dampening demand, Mr Al Omair said.
World prices dropped at the close on Friday as the dollar rose sharply, making dollar-priced crude
more expensive for buyers using weaker foreign currencies. West Texas Intermediate for delivery
in April slid $1.15 to $49.61 on the New York Mercantile Exchange, ending near its week-ago
level.
Brent North Sea crude for April, the international benchmark, dropped 75 cents to $59.73 a barrel
in London. Brent is up from lows near $45 hit in mid-January. Asked about Opec’s decision in
November to maintain output instead of cutting it in an effort to support prices, Mr Al Omair said it
“was not a hostile resolution but balanced”.
The issue of oil’s drop is the collective responsibility of all oil-producing countries, both Opec and
non-Opec, he said. Last week, Saudi Arabia’s oil minister Ali Al Naimi said he expected oil prices
to stabilise as supply and demand balanced, and urged non-Opec producers to help balance the
market.
Opec shouldn't cut output to ‘subsidise’ shale: Badri
Reuters + NewBase
The Organisation of the Petroleum Exporting Countries Secretary-General said on Sunday that
the group's exporters should not cut output to "subsidise" higher-
cost shale, an energy source whose recent growth is blamed by
Opec for weakening oil markets.
Abdullah al-Badri added in remarks to a conference in Bahrain that
tight oil, a term he has used for shale, was "not a challenge for us"
but the market should now be left to decide which source of
petroleum could survive at current prices.

Oil prices have sunk to near six year lows in recent months as a result of a large supply glut, due
mostly to a sharp rise in US shale production as well as weaker global demand. The rapid decline
has left several smaller oil producing countries reeling and has forced oil companies to slash
budgets.
"We welcome tight oil... but this source of energy costs too much to produce. You cannot produce
it at $70-$80 or $90, you need $100 plus to produce, sell it and make income out of it," Badri said.
"Opec cannot subsidise another source of energy -- if we reduce (production) in November we will
reduce in January. We will reduce in December. We will reduce maybe for another four to five
years," he said.
"We cannot every time keep reducing our production, it (tight oil) is not a challenge for us ... we
welcome it, but let the market decide now." Badri also said that Opec and non-Opec producers
should work together to stabilise markets, suggesting oversupply could amount to two million
barrels per day (bpd).
Since 2008, supplies from non-Opec producers had risen by almost six million bpd, he said. In
contrast, Opec production had been fairly steady at about 30 million bpd. Badri said the market's
"true picture" would not be apparent until the end of June, adding he had no doubt markets would
return to balance in the second half of 2015.
The market was improving now, he said, and "tremendous opportunity" in oil remained despite
recent market volatility and uncertainties. Energy demand would increase by 60 per cent by 2040
and oil would remain a central energy source, he said.

NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE
Your partner in Energy Services
NewBase energy news is produced daily (Sunday to Thursday) and
sponsored by Hawk Energy Service – Dubai, UAE.
For additional free subscription emails please contact Hawk Energy
Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
Mobile : +97150-4822502
khdmohd@hawkenergy.net
khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with a total of 25 years of experience in
the Oil & Gas sector. Currently working as Technical Affairs Specialist for
Emirates General Petroleum Corp. “Emarat“ with external voluntary Energy
consultation for the GCC area via Hawk Energy Service as a UAE
operations base , Most of the experience were spent as the Gas Operations
Manager in Emarat , responsible for Emarat Gas Pipeline Network Facility &
gas compressor stations . Through the years , he has developed great
experiences in the designing & constructing of gas pipelines, gas metering & regulating stations
and in the engineering of supply routes. Many years were spent drafting, & compiling gas
transportation , operation & maintenance agreements along with many MOUs for the local
authorities. He has become a reference for many of the Oil & Gas Conferences held in the UAE
and Energy program broadcasted internationally , via GCC leading satellite Channels.
NewBase : For discussion or further details on the news above you may contact us on +971504822502 , Dubai , UAE
NewBase 03 March 2015 K. Al Awadi

New base 556 special 09 march 2015

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