Petroleum Review - November 2009
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Editorial - Is gas the wild card in the energy pack?
GAS - ELECTRICITY
Gas attack
Gas might appear poised to dominate the power market, but don’t get your hopes up, writes Gordon Cope.
ASIA-PACIFIC – OVERVIEW
Demand running ahead of supply
As in previous years, the Asia-Pacific region continues to become ever more dependent on oil and gas imports as regional demand continues to run ahead of regional production. The effect, however, is much more significant for oil, where the region accounts for 30% of global consumption but for only 9.7% of global oil production. For gas, the mismatch is rather smaller, with the region accounting for just over 16% of global gas consumption but only 13.4% of global gas production. The reality may be that Asia-Pacific gas markets are relatively underdeveloped and that usage will increase so that in future the region accounts for a rather higher percentage of global gas usage, writes Chris Skrebowski.
ASIA-PACIFIC – INDIA
A cornerstone for energy security
At the end of 2008, India’s proven reserves of oil and natural gas were 5.8bn barrels and 38.5tn cf respectively. These estimates are based on limited drilling experience. The total proportion of India’s sedimentary basin area explored to date is only 21%, with drill density in places as low as one well per 1,000 sq km. Given India’s growing need to import oil and gas, the urgency of a thorough evaluation of India’s petroleum deposits is clear, writes James Camilleri.
ASIA-PACIFIC – MYANMAR
Doing business in Myanmar
Myanmar is both a dream and a nightmare for energy companies. First, it is undoubtedly resource rich. According to the BP Statistical Review of World Energy, the country had 17.5tn cf of proven natural gas reserves at the end of 2008, roughly the same as Vietnam. Yet it is ruled by a pariah military regime that is accused of gross human rights violations. Both the European Union (EU) and the US have imposed stiff economic sanctions on Myanmar while human rights groups lobby tirelessly, pressuring overseas companies working in the country to spend money on damage control to their corporate image. Dinah Gardner reports.
ASIA-PACIFIC – TIMOR SEA
Sunrise gains momentum
The failure in 2004 of Australia and its newly independent neighbour Timor-Leste (East Timor) to agree on how to exploit the abundant hydrocarbons of the Timor Sea’s Greater Sunrise fields, has delayed the project by five years. However, according to a spokesperson from Australia’s Department of Foreign Affairs and Trade, ‘a decision about the preferred development method will be reached in the coming months’, writes Karryn Miller.
ASIA-PACIFIC – INDIA
Power problems
India’s power shortage is a formidable obstacle to the country’s development, writes Gordon Feller. More than 400 million Indians – equal to the combined populations of the US, UK and France – do not have access to electricity, while some 60% of Indian industries are forced to make their own arrangements for securing a reliable power supply. Last year, the country faced a 16.6% supply shortfall during hours of peak consumption and a 9.9% gap for energy generation.
ASIA-PACIFIC – PAKISTAN
Struggle to develop resources
It’s simple – when there is political and civil turmoil in a country, its hydrocarbon production will suffer. Indeed, Pakistan’s oil and gas industry is not doing well, with oil and gas production declining in 2008, write Saeed Akhtar Baloch and Keith Nuthall.
ASIA-PACIFIC – REVIEW
Development plans are a-plentyGas still continues to dominate the energy scene in the Asia-Pacific, with LNG playing an everincreasing role in meeting regional demand. David Hayes provides a snapshot review of some of the latest developments in the region.
Features
FINANCE – CARBON BONDS
Over the hedge
Uncertainties surrounding government commitments to carbonising the economy create three key risks – missed carbon emission targets, low fossil fuel prices and low carbon prices. Such risks reduce the attractiveness of clean technology projects. But can governments themselves help hedge these risks? Professor Michael Mainelli FCCA FSI MEI, Z/Yen Group (a leading Londonbased commercial think tank) and Jan-Peter Onstwedder, Head of Risk & Portfolio, 3i, look at the role index-linked carbon bonds can play in addressing this issue.
SOUTHERN AFRICA – REFINING
A fuel dilemma
Oil analysts in Southern Africa predict a slowdown in the development of the fuel sector because of the global economic meltdown in the face of weakening buying power of the industrialised countries – including the US, writes Alfred Sayila. However, countries in the region had a number of projects planned to build and expand refineries, while also venturing into biofuels production.
UK – WIND
Lessons to be learnt
Norman Smith looks at how the UK’s offshore wind sector could learn a lesson or two from the experience of the UK’s North Sea oil industry.
ENERGY INSTITUTE – AUTUMN LUNCH
The future of energy
At the Energy Institute (EI) Autumn Lunch last month, Peter Voser, Chief Executive, Shell, gave a brief insight into what the future energy mix might look like, outlining that alternative sources of energy will not be able to offer a solution on their own, and that cleaner fossil fuels – notably natural gas – will have a large part to play in the transition to a sustainable, low carbon economy. The highlights of his presentation follow.
ENERGY INSTITUTE – EXECUTIVE BRIEFING
Managing change
‘Managing change in an uncertain world’ was the topic of a well-attended Executive Briefing that ran prior to the EI Autumn Lunch. The following provides a snapshot of the key themes addressed.
SKILLS – PROCESS INDUSTRIES
Minding the gap
At the National Skills Conference, organised by the National Skills Academy Process Industries earlier this year, Tom Crotty, Chief Executive of INEOS Olefins, gave his thoughts on the skills challenge in a keynote speech. Below is a summary of his presentation.
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