NewBase 09 May 2024 Energy News issue - 1723 by Khaled Al Awadi.pdf

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NewBase Energy News 09 May 2024 No. 1723 Senior Editor Eng. Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
U.A.E: ADNOC signs third long-term Heads of Agreement for
Ruwais LNG project
(WAM)
ADNOC announced today the signing of a 15-year Heads of Agreement (LNG agreement) with
EnBW Energie Baden-Württemberg AG (EnBW), one of the largest energy companies in Germany,
for the delivery of 0.6 million metric tonnes per annum (mmtpa) of liquefied natural gas (LNG).
The LNG will primarily be sourced from ADNOC’s lower-carbon Ruwais LNG project, currently under
development in Al Ruwais Industrial City, Abu Dhabi.
The Ruwais LNG plant is set to be the first LNG export facility in the Middle East and Africa region
to run on clean power and will leverage the latest technologies and artificial intelligence (AI) tools to
minimise emissions and drive efficiency.
ww.linkedin.com/in/khaled-al-awadi-80201019/

This agreement marks the third long-term LNG supply agreement from the project. The deliveries
are expected to start in 2028, upon commencement of commercial operations.
Fatema Al Nuaimi, ADNOC Executive Vice President of Downstream Business Management, said,
“The Ruwais LNG project continues to gain momentum, reinforcing ADNOC’s position as a reliable
global natural gas provider. This new agreement builds on the UAE-Germany Energy Security and
Industry Accelerator and will support Germany as it strives to diversify its energy sources and
enhance its energy security.”
The UAE-Germany Energy Security and Industry Accelerator (ESIA), signed in 2022, aims to
advance cooperation in energy security, decarbonisation and lower-carbon fuels.
Peter Heydecker, EnBW’s Board Member for Sustainable Generation Infrastructure, said, “We are
delighted that EnBW has signed its first LNG contract in the Middle East with our experienced
partner ADNOC.
In doing so, we are taking the next step in terms of diversifying our procurement portfolio and
establishing our own LNG value chain. We can also use the experience gained here for our medium-
term goal of establishing an import structure for green gases, since the two business fields are very
similar.”
The LNG agreement is contingent upon a final investment decision (FID) on the project, including
regulatory approvals and the negotiation of a definitive Sale and Purchase Agreement between the
two companies.
When completed, the project, which consists of two 4.8 mmtpa LNG liquefaction trains with a total
capacity of 9.6 mmtpa, will more than double ADNOC’s LNG production capacity to around
15mmtpa.

U.S. West Coast refinery demand for hydrogen increasingly met
by merchant suppliers U.S. Energy Information Administration, Refinery Capacity Report
U.S. West Coast refiners are using more hydrogen purchased from merchant suppliers than from
their own production. From 2012 to 2022, hydrogen purchased by refiners in the region increased
29% to about 550 million cubic feet per day (MMcf/d).
Over the same period, on-site refinery-produced hydrogen production from natural gas fell 20% to
about 330 MMcf/d. Merchant suppliers accounted for more than 62% of the hydrogen consumed by
West Coast refineries in 2022.
Hydrogen demand in the U.S. refining industry increased significantly from 2006 to 2010 as ultra-
low sulfur diesel (ULSD) was phased in for all on-road diesel. Hydrogen is particularly important in
processing low-grade, sour crude oil slates with high sulfur contents.
Refineries typically fulfill incremental hydrogen demand by either producing it themselves on-site
through steam methane reforming of natural gas or by purchasing it from merchant suppliers.
The trend toward greater use of purchased hydrogen is also evident nationwide but on a smaller
scale. Merchant suppliers met 70% of U.S. refinery hydrogen demand in 2022, the highest
percentage since we began publishing these data in 2009. For comparison, merchant suppliers met
63% of U.S. refinery hydrogen demand in 2019.
Merchant-supplied hydrogen for petroleum product and renewable diesel production originates from
industrial processes where it is a by-product; industrial natural gas producers use steam methane
reformers (SMRs) to convert natural gas feedstock into hydrogen. These third-party industrial
natural gas producers are sometimes outside of the refinery, but some own and operate the SMR
units inside the refinery.

By-product hydrogen can be obtained from a chemical plant or other facility where hydrogen is not
the main product. In the chemical industry, for example, the chlor-alkali industry produces hydrogen
as a by-product of chlorine production, and petrochemical plants release hydrogen as a by-product
of olefin production.
According to an internal 2018 EIA study, by-product hydrogen accounts for at least 50% of all
hydrogen purchased by U.S. refineries and at least 30% of all hydrogen that refineries need that is
not produced from by-product reforming.
Refineries also use hydrogen coming off their own catalytic reformers; however, we do not
collect these data because hydrogen input from refinery reformer units is counted indirectly as crude
oil and unfinished oil inputs. We only collect data on hydrogen produced by SMR units.

China April crude oil imports rise 5.45% on previous year
By Reuters
China's crude oil imports rose on the previous year in April, as refiners prepared for a fully recovered
Labour Day holiday travel season, official data showed on Thursday.
Crude imports in April totalled 44.72 million metric tons, or about 10.88 million barrels per day (bpd),
according to data from the General Administration of Customs.
An oil tanker unloads crude oil at a crude oil terminal in Zhoushan, Zhejiang province, China July 4, 2018.
REUTERS/Stringer/File Photo Purchase Licensing Rights, opens new tab
That represented a 5.45% increase from the relatively low 10.4 million bpd imported in April 2023.
China saw more than 1.3 billion passenger trips over the five day Labour Day holiday that began on
May 1, up 2.1% from a year earlier, state media outlet Xinhua reported.
Highway traffic was up 2.1% while air trips surged 8.1%, Xinhua said.
Domestic airline seat capacity in April was up 1.3% on last year, data from consultancy OAG
showed.
China's manufacturing sector continued to see muted recovery in April.
Imports slowed by 5.8% from March's level of 11.55 million bpd.
"China’s crude buying slowed down on strengthened crude oil prices and weakened domestic diesel
demand," said Lin Ye, an analyst at Rystad Energy in Beijing.

"China’s crude demand is expected to be supported by larger export quota this year and new
refinery start-up later this year," she added.
Chinese consultancy JLC said ahead of the data that it forecast sea-borne oil shipments to fall 4.6%
in April from March due to tight profit margins and the arrival of maintenance season.
JLC forecast maintenance at state-owned refineries to peak in the second quarter, with a knock-on
effect on April refinery throughput. However, the amount of capacity shutdown for maintenance at
state-owned refineries is to be 24% lower than last year, according to data cited by China
commodities consultancy MySteel.
Natural gas imports for April rose 14.7% from a year earlier to 10.30 million tons, customs data
showed.
Prices of LNG for Asia at the end of April were down 11.3% on the same period last year, and down
43% from last year's peak in October.
Customs data also showed exports of refined oil products, which include diesel, gasoline, aviation
fuel and marine fuel, were up 21.46% from a year earlier at 4.55 million tons.

NewBase May 09 -2024 Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oil rises on U.S. crude storage draw, Fed rate cut hopes
Reuters + NewBase
Oil prices rose in early trade on Thursday as shrinking U.S. crude inventories signalled tighter
supply, and amid rising hopes that the Federal Reserve would cut interest rates by the end of the
year.
Brent crude futures for July rose 35 cents to $83.93 a barrel by 0633 GMT. U.S. West Texas
Intermediate crude for June was up 44 cents to $79.43 per barrel.
Crude inventories dropped last week by 1.4 million barrels to 459.5 million barrels, according to the
Energy Information Administration, more than analysts' expectations in a Reuters poll for a 1.1
million-barrel draw as refinery activity increased.
Rising gasoline stocks, which swelled unexpectedly by more than 900,000 barrels in the week to
228 million barrels, the EIA said, kept prices from moving higher.
Oil price special
coverage
Oil edged higher after a mixed snapshot of US inventories that
included an unexpected drop in nationwide crude holdings.

Increasing expectations that the U.S. central bank will cut interest rates by year end after weaker-
than-expected U.S. jobs data also boosted oil prices. Lower interest rates can increase spending
on crude oil.
Hopes for a ceasefire in the Middle East, however, with the U.S. saying earlier in the week that
negotiations on a Gaza ceasefire should be able to close the gaps between Israel and Hamas
negotiations, kept oil prices from moving higher.
The energy markets have been under pressure since April amid increased diplomatic efforts to strike
a ceasefire deal between Israel and Hamas, though no agreement has been made yet.
“Headlines regarding a potential cease fire could further reduce crude prices by $3-4, but only if it
signifies a genuine move to long lasting peace rather than a temporary pause in hostilities,” Rebecca
Babin, US senior energy trader at CIBC Private Wealth, said in a recent note.
“However, fundamental, technical and macro headwinds indicate that it is too soon to get back on
the bull. There will be an opportunity to buy the dip but our view is not to buy it just yet. Brent is likely
to test $80 and WTI $75 in the short term and now would be the time to reestablish longs,” added
Babin.
Oil crept higher in the first months of the year amid Houthi rebel attacks on Western cargo shipments
in the Red Sea as well as Ukrainian drone attacks against Russian refineries.
Most analysts expect OPEC+ to extend its current production cuts when the oil alliance meets next
month.
“Incrementally bearish fundamentals increase the probability of a full extension of OPEC+ cuts
beyond Q2,” Goldman Sachs analysts said in a note this week.
U.S. crude oil recovers losses after surprise stockpile decline
Crude oil futures rose Wednesday, recovering losses from earlier in the session as U.S.
crude inventories fell.
Oil prices found support after U.S. commercial crude stockpiles declined by 1.4 million
barrels in the first week of May, according to official data from the Energy Information
Administration. The decline was a surprise compared to industry data that indicated a
509,000 barrel buildup.
Prices have come under pressure as of late on rising inventories with U.S. stockpiles
surging in the last week of April.
“Oil market indicators have turned softer in recent weeks, and prices have declined from
recent peaks,” Morgan Stanley analysts said in a research note. “The oil market is not
tight now, but we see seasonal strength ahead in coming months.”
Here are Wednesday’s closing energy prices:
 West Texas Intermediate June contract: $78.99 a barrel, up 61 cents, or 0.78%.
Year to date, U.S. crude oil has risen 10%.

 Brent July contract: $83.58 a barrel, up 42 cents, or 0.51%. Year to date, the
global benchmark has risen 8.5%.
 RBOB Gasoline June contract: $2.53 per gallon, down 0.46%. Year to date,
gasoline futures are up about 20%.
 Natural Gas June contract: $2.19 per thousand cubic feet, down 0.91%. Year to
date, gas is down 13%.
Oil prices have fallen more than 7% since reaching their April highs when traders bid up
prices on fears that Iran and Israel would go to war. Investors have largely sold off the
war premium since then, with Morgan Stanley removing $4 per barrel of risk from its oil
price forecast for the year.
Still, the outlook for summer oil demand looks robust and OPEC+ will likely extend its
production cuts until the end of the year, according to Morgan Stanley. This should
support a 2 million barrel per day deficit in the third quarter and Brent prices at $90 over
the summer.
OPEC and allies, including Russia, will meet on June 1 to discuss its production policy.
Russian Deputy Prime Minister Alexander Novak said Tuesday that there is currently no
discussion within OPEC+ of increasing oil output.
In the Middle East, CIA Director William Burns is due in Israel to discuss the latest Gaza
cease-fire negotiations in Cairo, a source familiar with the matter told NBC News.

 Hawk Energy Sees Oil at $85-$100 This Year With Strong Demand Growth
 That’s a ‘ foreseeable & sensible range,’ Hawk Energy CEO M. Al Shihabi says
 Demand set to grow to 104 MBD up by 2.0 MBD, in 2024: Al Awadhi says

NewBase Specual Coverage
The Energy world – May 09 -2024
CLEAN ENERGY
What OPEC+ oil output cuts are currently in place?
Reuters - By Alex Lawler + NewBase
OPEC+ oil producers are making voluntary output cuts totalling about 2.2 million barrels per day
(bpd) for the first half of 2024, led by Saudi Arabia rolling over an earlier voluntary cut.
These curbs from the
Organization of the
Petroleum Exporting
Countries and allies, known
as OPEC+, come on top of
earlier reductions
announced in various steps
since late 2022 and bring the
total pledged cuts to about
5.86 million bpd, equal to
about 5.7% of daily world
demand, according to
Reuters calculations.
OPEC+ is scheduled to
meet on June 1 in Vienna to
decide its next output policy
steps.
WHAT ARE THE MOST RECENT CUTS?
The latest 2.2 million bpd round of voluntary cuts was announced by the individual countries on Nov.
30 2023.
Initially in place for the first quarter of 2024, the countries in March extended them until the end of
June and Russia slightly adjusted how its cut would be implemented.
Included in the 2.2 million bpd is an extension of existing Saudi and Russian voluntary cuts from
2023 of 1.3 million bpd, meaning the newest element of the cut is about 900,000 bpd.
WHAT WERE THE EARLIER CUTS?
Before November 2023, OPEC+ was making production cuts of about 5 million bpd, comprising 1.3
million bpd of Saudi and Russian voluntary cuts put in place earlier in 2023, and 3.66 million bpd
agreed in previous steps.
Of the 3.66 million bpd, 2 million bpd was agreed by OPEC+ in late 2022 and several members
agreed voluntary cuts of 1.66 million bpd in April 2023.
OPEC+ when it met in June 2023 extended the 3.66 million bpd of cuts until the end of 2024.
HOW DO THE OUTPUT CUTS AFFECT TARGETS?

The following table shows OPEC+ pledged cuts and production targets for the first half of 2024 in
millions of barrels per day, based on information from OPEC, individual nations and Reuters
calculations.
Totals are rounded.
*International Energy Agency figures excluding OPEC members Iran, Libya and Venezuela which are
exempt from making cuts
** Congo and Nigeria targets taken from OPEC statement putting their achievable production at this
level
*** Russia initially promised to deepen cuts to 500,000 bpd of oil and oil product exports in the first
quarter 2024. In March, Russia said it would cut 471,000 bpd from production and exports in April –
June. The table is calculated using the initial figure
**** Figure is total for Bahrain, Brunei, Malaysia, Sudan and South Sudan

Russia Pumps Oil Above Target as New Voluntary Cuts Enter Force
Bloomberg
Russia cut its crude oil production by less than pledged last month, exceeding the voluntary target
agreed in March with OPEC+, according to Bloomberg calculations based on official data.
Daily crude production averaged just under 1.285 million tons last month, said people familiar with
data from the Energy Ministry, who spoke on condition of anonymity because the figures aren’t
public. That equates to 9.418 million barrels a day, based on the typical 7.33 barrel-per-ton
conversion ratio for the nation’s crude.
A worker passes a gas treatment unit at the Kasimovskoye underground gas storage facility in
Kasimov, Russia.
That means Russia’s crude output in April
was about 219,000 barrels below March
level, but still some 319,000 barrels above
the level specified in its agreement with the
Organization of Petroleum Exporting
Countries. Moscow had promised to put
greater emphasis on production cuts,
instead of export reductions, in a joint move
to avert a global surplus and shore up prices.
Russia’s Energy Ministry didn’t immediately
respond to requests for comment on the April
and March crude-output figures.
Output of 9.4 million b/d exceeded target of 9.1 million b/d
Moscow pledged to deepen production cuts from April to June

Falling Short of Promise
Russia pledged to deepen output cuts to total 850,000 barrels a day in April
Source: Bloomberg calculations based on Energy Ministry's figures seen by people familiar with
data
Russia is the only OPEC+ nation splitting its curbs between production and exports of crude and
refined products. This quarter, Moscow promised to reduce its output more, while expanding its
exports by a similar amount.
For April, Russia pledged to pump 350,000 barrels a day less than the prior month, which came on
top of 500,000 barrels a day of production curbs announced in February 2023. The country’s
targeted daily production level for April was 9.099 million barrels.
Russia has promised to deepen its total daily output cuts to 900,000 barrels and 971,000 barrels in
May and June respectively. That would put Russia’s total output curbs in the second quarter roughly
in line with Saudi Arabia’s reductions. OPEC+ is set to meet next month in Vienna to consider
whether to prolong its cuts into the second half of the year.
Moscow classified its oil production data last year due to its sensitivity amid Western sanctions over
the Kremlin’s aggression against Ukraine. The ministry doesn’t disclose the tons-to-barrels
conversion ratio it uses for its own assessment of monthly compliance, so the internal calculations
may differ from those made by Bloomberg.

NewBase Energy News 09- May - Issue No. 1723 call on +971504822502, UAE
The Editor:” Khaled Al Awadi” Your partner in Energy Services
NewBase energy news is produced Twice a week and sponsored by Hawk Energy Service – Dubai, UAE.
For additional free subscriptions, please email us.
About: Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
www.linkedin.com/in/khaled-al-awadi-38b995b
Mobile: +971504822502
khdmohd@hawkenergy.net or khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with over 30 years of experience in the Oil & Gas
sector. Has Mechanical Engineering BSc. & MSc. Degrees from leading U.S.
Universities. Currently working as self leading external Energy consultant for the
GCC area via many leading Energy Services companies. Khaled is the Founder of
the NewBase Energy news articles issues, Khaled is an international consultant,
advisor, ecopreneur and journalist with expertise in Gas & Oil pipeline Networks,
waste management, waste-to-energy, renewable energy, environment protection
and sustainable development. His geographical areas of focus include Middle East,
Africa and Asia. Khaled has successfully accomplished a wide range of projects in
the areas of Gas & Oil with extensive works on Gas Pipeline Network Facilities & gas
compressor stations. Executed projects in the designing & constructing of gas pipelines, gas metering &
regulating stations and in the engineering of gas/oil supply routes.
Has drafted & finalized many contracts/agreements in products sale, transportation, operation &
maintenance agreements. Along with many MOUs & JVs for organizations & governments authorities.
Currently dealing for biomass energy, biogas, waste-to-energy, recycling and waste management. He has
participated in numerous conferences and workshops as chairman, session chair, keynote speaker and
panelist.
Khaled is the Editor-in-Chief of NewBase Energy News and is a professional environmental writer with over
1400 popular articles to his credit. He is proactively engaged in creating mass awareness on renewable
energy, waste management, plant Automation IA and environmental sustainability in different parts of the
world. Khaled has become a reference for many of the Oil & Gas Conferences and for many Energy program
broadcasted internationally, via GCC leading satellite Channels. Khaled can be reached at any time, see
contact details above.

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