Projects & Finance

Anadarko’s recent FID on the $20 billion Mozambique LNG project will sweep substantial revenue into state coffers. From the early 2030s, royalties from Mozambique LNG alone will reach an estimated $3 billion per annum, doubling today’s state revenue and freeing up funds for integrated power projects.

Russia’s Gazprom is preparing to feed first gas into the Power of Siberia pipeline for export to China. Production drilling is in full swing at the Irkutsk Region-based Kovyktinskoye field, which will start pumping gas into the 38 bcm/y gas interconnector with China in early 2023.

Australian-listed LNG Ltd, developer of the Magnolia LNG project in Louisiana, is striving to sign a full sales and purchase agreement (SPA) with Delta Offshore Energy. The first LNG cargo could set sail to the Mekong Delta in May, or early June 2020, for use in an integrated 3.2 GW combined-cycle power plant.

Siemens has expanded Bolivia’s three largest thermal power plants to efficient combined-cycle mode, adding a total of 1 gigawatt (GW) of electric power output to the Bolivian grid. The three CCGTs, operated by Ende Andina, were commissioned within a few weeks in August and September.

MAN Energy Solutions is supplying two 9L51/60 engines for a new power plant in Gambia, build on behalf of the local utility NAWEC. Situated in Brikama, the plant will produce 18 MW of electrical output, adding 20% to the installed capacity of the West African country.

Hong Kong-listed VPower Group, together with Myanmar’s Zeya Associates, has been awarded four of the five emergency power projects tendered by the energy ministry. Three power projects, with a combined capacity of 900 MW, will run on imported LNG.

Harnessing methane-laden waters from Lake Kivu, the government of Rwanda has entered a public-private partnership (PPP) with Shema Power Lake Kivu Ltd (SPLK), formerly Symbion Energy, to develop a 55 MW power plant. Ultimately, the government aims to fuel over 500 MW capacity with methane from the lake by 2024.

Nigeria’s Indorama Eleme Petrochemicals Ltd (IEPL) is benefitting from an upgrade of the first two out of six GE 6B gas turbines at its onsite power plant in Rivers State. The upgrade increased the electricity output of Indorama's plant by 15% per gas turbine.

Japan’s energy giant JERA has agreed to pay $300 million to buy a 22% stake in Summit Power International with the aim of getting involved in major energy infrastructure projects in Bangladesh.The deal follows an agreement between Summit Corp and JERA to jointly develop a $500 million project in Cox’s Bazar, which will include various terminals for cargo and LNG.

First oil from Johan Sverdrup – Norway’s sixth-largest discovery, with 2.7 billion barrels reserves – is a red-letter day for the operator Equinor and partners Lundin Norway, Petoro, Aker BP and Total. The field started two months ahead of schedule and 40 billion Norwegian Krone ($4.38 bn) below budget.

Nigeria’s BelemaOil Producing Ltd has contracted MAN Energy Solution to supply three MGT gas turbine heat and power systems for installation at BPL’s upstream operation, some 30 miles southwest of Port Harcourt.

PJSC Kazanorgsintez, one of Russia's largest chemical companies, has awarded Siemens a contract worth 290 million Euros to build 250 MW combined-cycle power plant at its manufacturing site in Tatarstan. Start of commercial operation is planned for 2023.

Regulators in Vietnam have approved the Son My 2 combined-cycle power plant, proposed by AES and PetroVietnam affiliate PV Gas. Built in Binh Thuan, south-central Vietnam, the 2,250 MW project is meant to reach financial close in 2021 and start up in 2024.

Kobelco Power Moka, part of Kobe Steel, has commissioned and started up the first unit of its 1.25 GW Moka combined-cycle gas power project in Japan. The first of two 624 MW units is now supplying electricity to Tokyo Gas which said it set a target of procuring 5 million kW of electric power in the 2020s.

South Korea’s Samsung C&T has secured a $630 million order from Reliance Bangladesh LNG & Power to build a combined-cycle gas power plant in Meghnaghat. Construction will start in October with a view to get the 718 MW plant commissioned in July 2022.

Page 5 of 157

News in Brief

ExxonMobil enhances turbine oils

Jan 17 – New high performance turbine oils, developed by ExxonMobil Lubricants, are  entering the market which are formulated to prevent build-up of lacquer, varnish and deposits. The oils are designed to protect against thermal and oxidative degradation, one of the root causes of deposit build-up.

Wärtsilä signs O&M deals in the Bahamas

Jan 16 – Following the commissioning of a Wärtsilä-built 132 MW power plant in Bahamas in December, the Finish manufacturer now signed a two-year operation and maintenance (O&M) accord with the plant owner, the Bahamas Power and Light Company (BPL). Wärtsilä will transition, train, and develop the owner’s Bahamian work force and provide key performance guarantees.

China, S'Korea curtail coal to tackle air pollution

Jan 15 – Beijing city government’s aggressive approach to tackling air pollution is working and South Korea’s spring coal-fired curtailments show some success in cutting seasonal emissions. According to Wood Mackenzie, this should benefit LNG, particularly while spot prices remain low.

Sri Lanka at brink of power shortages

Jan 14 – Sri Lanka could face power cuts by March, after plans for a large-scale coal power plant were been cancelled just prior to start of construction, and a tender for a 300 MW diesel plants ended up in court. On the demand side, pressure is building up as the region is moving into the dry season in February and March. Weather warnings say the island is likely to receive lower than average rainfall in the first quarter of 2020.

Caterpillar’s new genset comply with UK & German grid codes

Jan 13 – Caterpillar Inc. has launched a series of new generator sets that comply with the new G99 United Kingdom, VDE-AR-N 4110 German and Belgium C10/C11 grid codes. The following gensets – G3500H, CG132B, CG170, and CG260 (rated from 280-4,500kVA) – have been verified to be able to accommodate different reactive power modes, active power functions, and connection conditions for normal operation or reconnection after mains decoupling.

Transneft launches battery-based power supply for ILI tools

Jan 10 – Transneft Diascan, the largest Russian inspection service provider for pipelines, has developed and put into operation a power supply system for in-line inspection (ILI) tools based on rechargeable batteries. Flaw detectors performing inspections of trunk oil pipelines, gas pipelines and oil product pipelines can now use the energy from rechargeable batteries, which helps save time and reduces the cost of in-line inspection.

Pavilion starts trading LNG out of Madrid

Jan 9 – Singapore-based Pavilion Energy has completed the acquisition of all gas and LNG assets of the Spanish utility Iberdrola. From its new European headquarters in Madrid, Pavilion said has launched 2020 LNG trading operations with supplies focusing on Spain and the UK market.

Gazprom extends gas transits via Belarus until 2021

Jan 8 – Gazprom and Gazprom Transgaz Belarus have sealed additional agreements to extend the contracts for gas supplies to and gas transportation across Belarus until 2021. According to the newly-signed documents, the contractual supply and transit volumes in 2020 will remain at the level of 2019.

EastMed pipeline to take FID by 2022

Jan 7 – Greece, Cyprus and Israel have signed an agreement to build the 1,900-kilometre EastMed pipeline at an estimated cost of 6 billion Euros. The subsea pipeline, spanning over 1,900-kilometres would initially carry 10 Bcm of gas per annum from Israeli and Cypriot waters to Crete and then on to the Greek mainland and into the European gas network via Italy. A final investment decision (FID) is meant to be reached in 2022, given that the pipeline is scheduled for completion by 2025.

U.S. energy-related emissions drop over 2%

Jan 6 – Fewer emissions from coal consumption, combined with lower energy demand, have helped to significantly reduce the overall energy-related carbon emissions in the United States. According to government statistics, energy-related CO2 emissions fell 2.2 percent last year, and the downward trend is forecast to continue into 2020.

Brent crude prices surge

Jan 3 – North Sea Brent crude prices have risen to their highest level since September 2019, up nearly $3 per barrel because of Middle East tensions coupled with improved Chinese economic forecasts. Brent crude futures for March 2020 delivery were last seen trading at 69.21 per barrel the Intercontinental Exchange (ICE). This bullish price sentiment will feed through to oil-indexed natural gas contracts and LNG deliveries, linked to the Japanese crude cocktail (JCC) basket price.

IEA says coal’s fate tied to Asia

Dec 23 – Rapid rise of wind and solar power in many parts of the world has pushed coal-fired power generation into steep decline in most developed countries. "But this is not the end of coal, since demand continues to expand in Asia," analysts at the International Energy Agency commented: "The region’s share of global coal power generation has climbed from just over 20 percent in 1990 to almost 80 percent in 2019, meaning coal’s fate is increasingly tied to decisions made in Asian capitals."

Drop in coal-burn makes Germany edge closer to climate targets

Dec 20 – In 2019, Germany managed to increase its greenhouse gas emissions for the second year in a row, mainly due to a 20 percent drop of coal use for power generation and a growing contribution from renewables. Energy savings and efficiency increases also helped. According to calculations by energy research group AG Energiebilanzen (AGEB), Germany’s primary energy consumption declined by 2.3 percent this year, overall energy use fell more than 2 percent, and energy-related CO2 emissions fell by as much as 7 percent.

Glencore buys Orsted’s lgas business unit

Dec 19 – UK-listed mining company Glencore has agreed to take over a loss-making natural gas business from Orsted, including long-term import capacity at the Gate regas terminal in Rotterdam and five other LNG purchase agreements. “The transaction entails a payment from Orsted to Glencore and will result in a loss that exceeds our current provision related to the LNG activities,” stated Copenhagen-based Orsted without disclosing the value of the transaction.

Carbon-intensive firms may shed over 40% in value

Dec 18 – Energy- and carbon-emissions intensive companies could lose up to 43% of their value if national governments enact more stringent policies to reduce air pollution and tackle climate change. Companies using green energy, in contrast, could gain up to 33% in value, research by the United Nations-backed Principles for Responsible Investment (PRI) finds.

COP25 – a “lost opportunity”

Dec 17 – UN Secretary António Gutierrez has dismissed the outcome of the COP25 climate talks in Madrid as “disappointing” and “lost opportunity“. Some of the world’s largest emitters, including Australia, Brazil, China and Saudi Arabia had joined the U.S. in pushing for accounting loopholes to weaken commitments to reduce emissions in the transport and power generation sector.

Industry produces over 13% of Germany’s electricity

Dec 16 – Decentralized power generation at industrial sites keeps rising in Germany. According to the Federal Statistical Office (Destatis), industry produced 55 Terawatt-hours (TWh) of in 2018, meaning local units of mining and manufacturing generated 12.6 percent of the country's gross electricity output, mostly from gas-fired power units. The use of gas as a fuel for industrial power plants has consequently risen from around 35 percent to almost 50 percent over the last ten years.