Daily News

The offshore section of the TurkStream pipeline through the Black Sea is now complete after the Russian President Vladimir Putin and his Turkish counterpart Recep Erdogan gave the command to weld the final joint of the pipeline’s second string. The entire pipeline will be commissioned in late 2019.

Leaked drafts of a report of Germany’s coal commission show the country’s coal exist will likely be delayed to 2022, rather than starting in 2020. The pathway of the coal exit is now in focus, rather than the exit date. Forced plant closure should be avoided, the commission said, stressing shut-downs need to agreed with operators who will claim compensation.

Seeking to cash in on the shift from coal to gas, Saudi Aramco has made plans to expand its multi-billion natural gas business at home and abroad. “Saudi Aramco is on the way to becoming a gas powerhouse in addition to its huge strength in oil,” the company stated, indicating it plans to boost production from 14 billion standard cubic feet per day (bscfd) to 23 bscfd of natural gas.

Iran has expanded its fleet of power plants by adding about 1,000 MW of new-built capacity since March 2018, the energy ministry reported. Installed capacity amounts to 80,000 MW, with gas powering nearly a third of the total. The government aims to add 3GW to meet peak demand.

Soaring costs of LNG imports have increased the importance of a swift restart of Japan’s nuclear reactors to generate comparatively cheap baseload power. Total cost for imported gas topped 418 billion yen ($3.71bn) in October, compared to 280 billion yen ($2.48bn) a year earlier, according to an alert by the Japanese finance ministry.

Seeking to strengthen ties with Europe, the Russian gas giant Gazprom is fast-tracking works on the $11 billion Nord Stream 2 project with the aim of starting first gas flows to northeast Germany in the autumn or early winter of 2019. Poland and the United States adamantly oppose the project.

Despite the drop in rig count, the actual output of crude oil and natural gas keeps rising in the United States thanks to advances in technology and drilling techniques. Even with fewer wells U.S. natural gas gross withdrawals increased from about 78.7 billion cubic feet per day (Bcf/d) to 83.4 Bcf/d.

Siemens has started construction on a new energy center in Bolivia, designed to provide traditional and digital services to electric utilities in South America. Equipment from Siemens is being deployed to expand three combined-cycle gas power stations in Bolivia: Termoeléctrica del Sur, de Warnes and Entre Ríos.

“2018 is the year of electricity,” the International Energy Agency (IEA) noted given that electric power has been the fastest growing element of final demand, and will outpace all energy sources over the next 25 years. Digitalization of the global economy goes hand in hand with electrification, making it the “fuel of choice” for households and enterprises.

Hit by a triple-whammy of weak cash flows, meager profits and slumping stock values, CEOs in the oil and gas industry are vary about continuing to invest in increasingly risky fossil fuels. Looking for a quick return, investors want oil majors to prioritize profits over production growth. Some refocus on electricity markets.

MAN Energy Solutions has been contracted to provide a new combined-heat-and-power (CHP) solution for Ben Gurion Airport in Tel Aviv, Israel. A dual-fuel engine MAN 9L51/60DF will be vital to power the airport, with plant handover scheduled for the end of 2019.

Hazards of oversupply in oil and natural gas are preoccupying International Oil Companies (IOCs) as less carbon-intensive sources of energy compound the risk of future oil and gas oversupply. Still, Moody's analysts are convinced oil majors will tackle these new issues through a triad of conservative financial policies to strengthen balance sheets, capital discipline, and robust long-term planning that anticipates secular shifts – like the global trend towards renewables and energy storage.

Taiwan Power Company has awarded a full-turnkey order to Mitsubishi Hitachi Power System (MHPS) to refurbish and upgrade its Nanpu and Datan gas-fired power plants. The contract stipulates low-NOx enhancements of seven M501F gas turbines, and the roll-out of the digital service MHPS-TOMONI. Works are due to be completed in August 2019.

Sinolam Smarter Energy (SSE), part of Shanghai Gorgeous Group, has awarded a long-term service agreement to Siemens for the SGT-800 gas turbines at the Gas to Power Panama project by Martano. The power plant will operate with LNG and is scheduled for commission in the autumn of 2020.

Withdrawal of water by U.S. thermal power stations, mostly for cooling purposes, continues to decline over the past four years and has fallen to a low of 52.8 trillion gallons. The water intensity – the average amount of water used per unit of total net electricity generated – fell from 15.1 gallons per kilowatthour (kWh) in 2014 to currently 13.0 gal/kWh.

News in Brief

PG&E nears bankruptcy

Jan 18 – Northern California’s utility Pacific Gas & Electric (PG&E) has informed federal regulators that it expects to seek Chapter 11 bankruptcy protection by January. The San Francisco-based utility is under investigation for its shortcomings in the deadly 2018 wildfires. S&P this week downgraded PG&E’s gas and electric unit to ‘D’ to ‘CC’ after the utility failed to make a $21.6 million interest payment

Hitachi suspends work on Wales nuclear project

Jan 17 – Japan’s Hitachi is close to suspending construction works at its Horizon division’s Wylfa nuclear power plant in Wales. If the project gets shelved, EDF Energy's Hinkely Point-C will be the only nuclear project remaining hence flexible gas power will have to fill the capacity gap.

PG&E files for bankruptcy by Jan 29

Jan 16 – Northern California’s utility Pacific Gas & Electric has informed federal regulators that it expects to seek Chapter 11 bankruptcy protection by end of this month. The San Francisco-based utility is under investigation for its shortcomings in the deadly 2018 wildfires.

Gas engine market to top $4.4bn by 2020

Jan 15 – Global demand for natural gas engines is forecast to expand with the market set to exceed $4.4 billion in value by 2022, according to Zion Market Research. Key manufacturers include, GE, Rolls-Royce, Cummins, Caterpillar, Wärtsilä, Kawasaki, MAN, Deutz, Doosan and Yanmar.

Encana selects Siemens rotating equipment

Jan 14 – Siemens has been selected to provide one feed and sales gas train and one refrigeration compression train for Encana’s Pipestone Processing Facility in Grand Prairie, Alberta, Canada. The new unit, due to operational in 2021, will provide Encana with 19,000 barrels per day of net raw condensate processing capacity plus 170 million cubic feet per day of net inlet gas processing capacity.

Cheap U.S. LNG underpins power project in Panama

Jan 11 – AES Colón expects the entry of low-cost US LNG will transform the Central American energy sector, much as it has in the Panama. The utility in September started up an $1.15 billion LNG import terminal and adjacent combined-cycle power plant.

Rolls-Royce joins forces with OT industries

Jan 10 – Britain’s bellwether manufacturer Rolls-Royce has signed an accord with OT Industries to explore areas of joint work for the provision of Emergency Diesel Generators (EDGs) and Instrumentation and Control (I&C) systems for new units at the Paks nuclear power plant in Hungary. OT industries is majority owned by the MOL Group.

State-run utilities dominate energy spending

Jan 9 – Future investments in global energy supply largely rest in the hands of governments. In the power sector, a striking 95% of monies are spent by regulated utilities under schemes to minimize risk associated with variable prices on competitive markets. However, once China will have completed its power sector reform the share of countries that rely on competitive markets will rise from 54% to almost 80%.

Floating power market to top $1.4bn by 2022

Jan 8 – The market for floating power plants (<250MW capacity) is expected to grow at an annual rate of 10.11%, expanding from currently $889.6 million to reach $1,440 million by 2022. Main growth drivers, according to MarketsandMarkets, are cost advantages of floating over land-based power plants, particularly in regions with a lack of power infrastructure.

Energean to supply gas to Israel

Jan 7 – Energean Oil and Gas has agreed to supply 5.5 Bcm of natural gas Karish and Tanin fields over 19 years to the Israeli power producer I.P.M. Beer Tuvia. The deal is expected to $900 million in revenue for Energean over the contract duration.

Eranove builds 390 MW plant in Ivory Coast

Jan 4 – Ciprel, a subsidiary of Eranove Group of France, is preparing to construct a 390 MW power plant in Jacqueville near Abidjan, the capital of the Ivory Coast. Driven by one of GE’s F-class turbine the combined-cycle power plant will be similar to one that Ciprel already has in operation.

Works advance on Jawa-1 CCGT

Jan 3 – Construction works are forging ahead for Jawa-1, a 1,760 MW combined-cycle gas-fired power plant. Built at cost of $1.8 billion the facility will be built by PT Jawa Satu Power (JSP) and PT Jawa Satu Regas (JSR) in Karawang, West Java.

Grozny TPP due onstream in 2019

Jan 2 – Construction of Unit 2 of the Grozny Thermal Power Plant (TPP) is advancing fast with a view having the entire plant operational in mid-2019. The first 180 MW unit has been running uninterruptedly for a fortnight and once the second unit will start up, Grozny TPP will reach its design value of approximately 360 MW.

E&P profitable at $50/bbl

Dec 21 – Globally, Wood Mackenzie expects exploration budgets to remain steady in 2019. But with stronger prices, lower costs and a greater focus on commerciality, the exploration sector is now seen to be more resilient than ever, and “well positioned to generate positive full-cycle returns at oil prices of US$50/barrel or even lower.”

GE upgrades substation in Germany

Dec 20 – TransnetBW has asked GE Power to upgrade one of the substations in so-called ‘Badische Rheinschiene’, a highly loaded link in the transmission grid of southwest Germany. The project will deliver 22 bays of 400 kV GIS to reduce the substation’s footprint while increasing its capacity.

Burckhardt opens service centre for Central Europe

Dec 19 – Swiss-based Burckhard Compressions has opened a new service centre for Central Europe in Slovakia. Reciprocating compressors of any brand are serviced there for operators in Slovakia, the Czech Republic, Hungary and Poland.

Global CCS growth nears 10% per year

Jan 19 – A report from analysts Research and Markets says the global Carbon Capture and Storage (CCS) market will grow 9.18% per year between 2017 and 2021, with Babcock & Wilcox, ENGIE, GE Power, Linde and Mitsubishi Heavy Industries dominating developments.