Anticipating a speedy energy transition globally, the global classification society DVN GV says upstream players are adapting to this trend by shifting to faster, leaner and cleaner hydrocarbon production techniques. Oil and gas demand are forecast to peak in 2023 and 2034, respectively, prompting upstream players to favour a greater number of smaller reservoirs with shorter life-spans.
CAPEX for new-build offshore wind parks in Asia will soon be competitive with thermal power, with investors gearing up to participate in first-mover projects. According to Wood Mackenzie, “together with South Korea and Japan, East Asia needs around US$37 billion in investments to meet the mammoth growth in offshore wind capacity over the next five years.”
Wärtsilä today reported a lower than expected quarterly profit due to a slowdown in services while order-intake in its power plant business remained stable. “Net sales developed well in the third quarter, thanks to the strong growth in newbuild marine and energy deliveries. This, in combination with slower development in transactional service volumes, is affecting the group sales mix and burdening profitability,” said Wärtsilä CEO Jaakko Eskola.
Annual capacity factors for gas-fired power generators in the PJM Interconnection – the largest competitive wholesale electricity market in the United States – have increased in recent years, reflecting greater use of competitively priced shale gas in the region. The role of combined-cycle gas power plants (CCGTs), in particular, has shifted from load-following to frequently providing baseload power supply, instead of coal.
The pipeline rupture in early October at Enbridge’s BC gas interconnector still affects electricity markets and petroleum refining in the U.S. Pacific Northwest. Imports averaged 1.1 billion cubic feet per day (Bcf/d) in the first half of this year, but fell to zero after the rupture and the pipeline now operates only at 80% capacity.
The global energy transition moves faster than expected Wood Mackenzie says, suggesting a "sustainability tipping point" – when the world shifts from the ‘Age of Oil & Gas’ to the ‘Age of Renewables’ – will arrive by 2035, less than 18 years from now. Renewables and the use of electric vehicles are seen underpinning the pace and intensity of the transition.
Substantially less nuclear power supply has been available throughout the U.S. this autumn, mainly because the 2018 seasonal maintenance and refueling cycle began earlier. According to the U.S. Energy Information Administration (EIA), the total nuclear outages averaged 14.5 GW in the last week of September, prompting utilities to fire up gas-fuelled power stations to balance supply and demand.
Cash-strapped General Electric is taking increasingly desperate measures to turn around the company’s fortunes. The new CEO Larry Clup needs more time for an “initial business review” so the Q3-earning release was pushed back to October 30, 2018. GE also announced it expects to take a non-cash goodwill impairment charge related to the GE Power business.
Total CEO Patrick Pouyanne and Adani Group Chairman Gautam Adani today signed an joint venture agreement to set up “multi energy offers” for the fast growing Indian market. The companies said they will jointly develop a fuel retail network and various regasification LNG terminals, including Dhamra LNG, on the East coast of India.
Alexey Miller, Gazprom Chairman and CEO, stays adamant in arguing China will prefer stepping up pipeline gas imports over incremental LNG supplies to meet the country’s rising energy demand. “Pipeline gas supplies from Russia will always be more competitive than LNG deliveries from any other part of the world,” Miller said, pointing out that Gazprom’s annual gas exports to Chinese buyers will reach 120 billion cubic meters this year alone.
French energy major Total is in advanced talks to buy a stake in gas import infrastructure in India. According to local media reports, Total seeks to purchase up to 50% of Adani Group’s stake in LNG terminals in Gujarat and Odisha as well as Adani’s city gas projects. Total CEO Patrick Pouyanne confirmed talks are being held but did not name the companies involved; the aim is to sell more gas from Total's global portfolio to India.
Costa Rica mainly relies on hydro power, wind and solar to cover its energy needs – hence some stable fossil-fuelled generating capacity is vital to balance intermittent renewable energy supply with actual demand. The largest of these backup power plants is the 200 MW ICE Garabito power station, running on 11 MAN 18V48/60 engines.
Coal-to-gas switch policies in China’s energy sector is expected to boost the country’s LNG demand by a 12 million tons in 2018, exceeding last year’s record growth of 8 mt. Already today, China’s energy hunger lies behind half of global LNG demand growth and Wood Mackenzie says: “Given China is only through its five year clean air policy, this growth story is far from finished.”
Risk of gas supply shortages this winter keeps growing in the U.S. because inventories are at record lows due to a late start of the gas storage refill season and high withdrawals. According to EIA’s Short-Term Energy Outlook (STEO) gas inventories will reach 3,263 billion cubic feet (Bcf) at the end of October – the lowest end-of-October level since 2005.
Ceylon Electricity Board (CEB) has entered into a joint venture with Hambantota Power Private, a Chinese company listed in Singapore, to build a 400-MW power plant that will be fuelled by regasified LNG. Situated near a key shipping route, the port of Hambantota is currently being expanded. It has been leased to China Merchants Port Holdings for 99 years after the state of Sri Lanka failed to repay a Chinese loan of US$1.4 billion.