Britain’s top engineering company Rolls-Royce has announced it will cut 4,600 jobs over the next 24 months in a bid to achieve run-rate net cost savings of £400 million per year by the end of 2020. Earlier this week, Rolls-Royce had to admit the costly compressor failure in its Trent 1000 package C engine has now also been found in a different type of engine.
Bowing to industry pressure, the British government has indicated it will make a direct investment of public money into the much-contended Wylfa nuclear project in north Wales, backed by Hitachi. Critics dismiss this move as state aid, a reversal of 40 years of UK energy sector privatisation, and unfair prioritisation of nuclear power to the detriment of renewables and new gas-fired power projects.
Gaining access to shale assets in Argentina, Qatar Petroleum has acquired a 30% stake in ExxonMobil’s prolific Vaca Muerta oil and gas play in the onshore Neuquén basin in Argentina. The deal is hoped to bring fresh drive to shale drilling in Argentina which had been rather slow due to local price controls for natural gas. However, President Mauricio Macri's right-of centre government lately doubled wellhead gas prices for existing fields and introduced incentive prices for new developments.
Improving power system flexibility is vital for cost-effective management of variability and uncertainty in both supply and demand, the International Energy Agency (IEA) finds. Hence the agency calls for a proactive response from regulators and policy makers to help manage today’s fundamental a transformation of energy markets.
Drax Group, together with C-Capture, has announced plans to pilot the first bioenergy carbon capture and storage (BCCS) project in Europe. The demonstration project will see Drax invest £400,000 in what it says “could be the first of several pilot projects” to deliver a rapid, lower cost demonstration of BECCS that could accelerate the commercialization of carbon capture in the UK.
Despite losses at the Power & Gas (PG) unit, Siemens has raised its full-year outlook following first-half results that exceed analyst expectations thanks to solid growth in the company’s software unit. “Our longterm investment in digital leadership is clearly paying off, delivering an overall book-to-bill ratio at 1.11x despite weakness in new business in the power sector," Siemens CFO Dr. Ralf P. Thomas said in an investors’ call today.
Profit margins of UK’s gas-fired power plants keep improving, boosted by the closure of aging coal power plants and delays in the construction of new nuclear capacity. Consequentially, gas power plants are seen contribute more than half of the UK’s electricity needs in less than 10 years, up from 45% in the previous years, according to Fitch Group affiliate BMI Research.
Federal financial interventions and subsidies in U.S. energy markets have been in a steep decline over the past five years. According to the U.S. Energy Information Administration (EIA), federal monies spent in energy markets nearly halved in the period 2013-16, falling from $29.3 billion in the 2013 fiscal year to $15.0 billion in FY2016.
Singapore-based Sembcorp Utilities is moving ahead with of a 750MW gas-fired power project in Vietnam, having just signed a land allocation deal with the People's Committee of Quang Ngai Province. “We are committed as a longterm investor to Vietnam,” said Koh Chiap Khiong, Sembcorp’s head of Singapore, Southeast Asia & China at Sembcorp, pointing at the company’s construction and co-ownership of the Phu My 3 power station.
Eni, the Italian state-owned oil and gas producer, has set out the timeline for sanctioning its LNG project in Mozambique. Final investment decision (FID) on the Coral FLNG project is set to be made in 2019, or 2020, with Eni targeting first gas from its Mamba discovery in the Rovuma basin for the Coral FLNG plant by 2024. Investors hope supply from the Coral venture could revive South Africa’s subdued gas-based Independent Power Projects (IPPs).