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Monday, 05 January 15
FIVE ENERGY SURPRISES FOR 2015: THE POSSIBLE AND THE IMPROBABLE - KURT COBB
 The coming year is likely to be as full of surprises in the field of energy as 2014 was. We just don't know which surprises! I am not predicting that any of the following will happen, and they will be surprises to most people if they do. But, I think there is an outside chance that one or more will occur, and this would move markets and policy debates in unexpected directions.
1. U.S. crude oil and natural gas production decline for the first time since 2008 and 2005, respectively. The colossal markdown in world oil prices has belatedly been followed by a slightly smaller, but nevertheless dramatic markdown in U.S. natural gas prices. The drop in prices has already resulted in announcements from U.S. drillers that they will curtail their drilling operations significantly next year.
But drilling that is already contracted for will likely go forward, and wells waiting for completion will be completed. It can be costly to pull out of drilling contracts. And, failing to complete already successful wells and bring them into production is downright foolish since the costs incurred in drilling the wells including future debt payments remain. In those circumstances, some revenue at lower prices is preferable to no revenue at all.
Having said all that, scaled-down drilling plans when combined with what's left in drillers' immediate inventory both to drill and complete may not be enough to overcome the prodigious production decline rates from existing wells in deep shale deposits of oil and gas which have provided almost all the recent growth in U.S. production. The decline rates are 60 to 91 over three years for tight oil plays and 74 to 88 percent over three years for shale natural gas plays.
If low prices continue for a second year, the cheers for "Saudi" America will disappear. It was never to be anyway. What America has left is high-cost oil and natural gas. And, even at high prices both were likely to peak and decline in the next 5 years. Now, low prices may bring peak production rates in the coming year for both U.S. oil and natural gas--peaks that may never be seen again.
2. World crude oil closes below $30 per barrel. I think that such a price would only last a short time unless the world is in the throes of the next Great Depression. But since OPEC has reaffirmed that it will continue to pump oil at current rates until non-OPEC production declines, look for this game of chicken to create increasing inventories of oil worldwide for several months. The underlying cause for rising oil inventories is slowing economic growth in much of Asia, especially China, and economic stagnation in Europe and Japan. Any pickup in worldwide growth would send oil significantly higher than where it is today as oil demand increases.
3. Developments in solar thermal energy show that it can solve the storage problem for electricity from renewable energy. The difficulty with renewable energy supplying electricity is that electricity is very expensive to store (and so we do very little of this). Storage is important because renewable energy production comes when the wind blows and the sun shines, but not always when we need it. A breakthrough in solar thermal may be in the offing that would overcome previous limits on temperatures generated by solar thermal capture devices and make it possible to store heat cheaply enough to run solar electric generating plants around the clock at high output.
4. A climate agreement in Paris calls for binding greenhouse gas emissions limits. Expectations are exceedingly low for next summer's international climate conference to be held in Paris. The aim is to agree on binding limits for carbon emissions for the world's nations. Few people think that will happen no matter what the urgency of the matter.
But we cannot know what climate events might occur between now and the Paris conference that would change the outcome. It would have to be big, on the order of an ice shelf plopping into the ocean and raising sea-level enough to notice. Nevertheless, I would say that such a disturbing event becomes more likely with time and might be necessary to move the world's nations to a binding emissions agreement.
Even some progress in the direction of a binding agreement will have the world's energy analysts talking about stranded assets, a reference to the oil, natural gas and coal that would have to be left in the ground in order to avoid breaching agreed limits on carbon emissions. That would have significant consequences for the companies whose work is extracting and refining hydrocarbons.
5. Oil prices reach $100 per barrel before December 31, 2015. This is the other extreme from surprise No. 3. Almost all analysts expect oil prices to remain low, and many believe we are now entering a new era of cheap oil. (I, of course, don't buy it.) An earlier and more dramatic drop in production than anticipated and a greater rise in demand than anticipated could easily bring prices back above $100. I think this is more likely to happen later in 2016. But the timetable for a return to prices above $100 could be accelerated by many factors not now apparent.
I regard none of these events as likely which is why they would be surprises. But even one of these surprises would result in large financial gains or losses for many. And, either of two of them--binding greenhouse gas emissions limits or a breakthrough in renewable energy storage--would have giant consequences for the entire world.
About Author:
Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He is a regular contributor to the Energy Voices section of The Christian Science Monitor and author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights.
Views and opinions / conclusion expressed herein are personal views of the author and not that of COALspot.com.
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Thursday, 09 November 23
GREEK AND CHINESE COMPANIES OWN 34% OF THE GLOBAL FLEET’S CARGO CAPACITY - BIMCO
“The global fleet of cargo carrying ships consists of around 61,000 ships with a deadweight capacity of about 2,200 million tonnes. The ships ...
Monday, 23 October 23
CHINA SEPT COAL OUTPUT HITS SIX-MONTH HIGH ON RISING POWER DEMAND - REUTERS
China’s September coal output rose 0.4% from August to the highest level since March, official data showed on Wednesday, on rising power dema ...
Monday, 23 October 23
INDIA COAL INVENTORIES DROP AT FASTEST PACE IN TWO YEARS, BOOSTING IMPORTS - REUTERS
Coal inventories at Indian power plants in the first half of October fell at their fastest rate in two years, an analysis of government data showed ...
Tuesday, 19 September 23
LNG SHIPPING STOCKS: THE ASIAN GROWTH UP-INDICES
Last week, the UP World LNG Shipping Index (UPI) gained 3.81 points or 2.51%, closing at 155.85 points. This index tracks the performance of LNG sh ...
Sunday, 10 September 23
GOLDMAN SACHS PREDICTS OIL PRICE TO HIT $100 ON OPEC CUTS - YAHOO FINANCE
Oil supply cuts by Saudi Arabia and Russia could lead to Brent crude jumping as high as $107 a barrel in 2024, Goldman Sachs Commodities Research h ...
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- Sinarmas Energy and Mining - Indonesia
- Goldman Sachs - Singapore
- Latin American Coal - Colombia
- PTC India Limited - India
- Jaiprakash Power Ventures ltd
- Indo Tambangraya Megah - Indonesia
- Wood Mackenzie - Singapore
- Kaltim Prima Coal - Indonesia
- Vedanta Resources Plc - India
- Electricity Authority, New Zealand
- Georgia Ports Authority, United States
- Directorate General of MIneral and Coal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Baiduri Energy - Indonesia
- Indogreen Group - Indonesia
- Agrawal Coal Company - India
- Central Java Power - Indonesia
- Marubeni Corporation - India
- Antam Resourcindo - Indonesia
- Deloitte Consulting - India
- Gujarat Electricity Regulatory Commission - India
- Baramulti Group, Indonesia
- Global Green Power PLC Corporation, Philippines
- Planning Commission, India
- Krishnapatnam Port Company Ltd. - India
- Barasentosa Lestari - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Eastern Coal Council - USA
- Parry Sugars Refinery, India
- Holcim Trading Pte Ltd - Singapore
- SN Aboitiz Power Inc, Philippines
- Mercuria Energy - Indonesia
- PowerSource Philippines DevCo
- Essar Steel Hazira Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Directorate Of Revenue Intelligence - India
- Savvy Resources Ltd - HongKong
- Orica Mining Services - Indonesia
- Sindya Power Generating Company Private Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Edison Trading Spa - Italy
- White Energy Company Limited
- LBH Netherlands Bv - Netherlands
- Maharashtra Electricity Regulatory Commission - India
- Toyota Tsusho Corporation, Japan
- South Luzon Thermal Energy Corporation
- Simpson Spence & Young - Indonesia
- Global Coal Blending Company Limited - Australia
- Asmin Koalindo Tuhup - Indonesia
- London Commodity Brokers - England
- VISA Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Banpu Public Company Limited - Thailand
- Maheswari Brothers Coal Limited - India
- Oldendorff Carriers - Singapore
- Kideco Jaya Agung - Indonesia
- OPG Power Generation Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- ASAPP Information Group - India
- Dalmia Cement Bharat India
- Thai Mozambique Logistica
- Central Electricity Authority - India
- Samtan Co., Ltd - South Korea
- The State Trading Corporation of India Ltd
- Interocean Group of Companies - India
- Trasteel International SA, Italy
- Eastern Energy - Thailand
- Merrill Lynch Commodities Europe
- Australian Coal Association
- Carbofer General Trading SA - India
- Tamil Nadu electricity Board
- Globalindo Alam Lestari - Indonesia
- Coal and Oil Company - UAE
- Malabar Cements Ltd - India
- Heidelberg Cement - Germany
- Sojitz Corporation - Japan
- Intertek Mineral Services - Indonesia
- Binh Thuan Hamico - Vietnam
- Posco Energy - South Korea
- Straits Asia Resources Limited - Singapore
- Siam City Cement - Thailand
- New Zealand Coal & Carbon
- Thiess Contractors Indonesia
- GVK Power & Infra Limited - India
- Altura Mining Limited, Indonesia
- SMG Consultants - Indonesia
- Indonesian Coal Mining Association
- Indika Energy - Indonesia
- Energy Development Corp, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Sree Jayajothi Cements Limited - India
- Cigading International Bulk Terminal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- Cement Manufacturers Association - India
- Indian Energy Exchange, India
- PetroVietnam Power Coal Import and Supply Company
- The University of Queensland
- CIMB Investment Bank - Malaysia
- Bhushan Steel Limited - India
- Vizag Seaport Private Limited - India
- GAC Shipping (India) Pvt Ltd
- Karaikal Port Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Orica Australia Pty. Ltd.
- Pendopo Energi Batubara - Indonesia
- Meralco Power Generation, Philippines
- Mintek Dendrill Indonesia
- McConnell Dowell - Australia
- Gujarat Mineral Development Corp Ltd - India
- Salva Resources Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Grasim Industreis Ltd - India
- IHS Mccloskey Coal Group - USA
- Standard Chartered Bank - UAE
- Siam City Cement PLC, Thailand
- Chettinad Cement Corporation Ltd - India
- Energy Link Ltd, New Zealand
- Parliament of New Zealand
- Africa Commodities Group - South Africa
- PNOC Exploration Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Medco Energi Mining Internasional
- Kobexindo Tractors - Indoneisa
- Wilmar Investment Holdings
- Sakthi Sugars Limited - India
- Borneo Indobara - Indonesia
- Australian Commodity Traders Exchange
- Star Paper Mills Limited - India
- Ambuja Cements Ltd - India
- Makarim & Taira - Indonesia
- Kumho Petrochemical, South Korea
- Karbindo Abesyapradhi - Indoneisa
- GMR Energy Limited - India
- Independent Power Producers Association of India
- Petron Corporation, Philippines
- Larsen & Toubro Limited - India
- Attock Cement Pakistan Limited
- IEA Clean Coal Centre - UK
- Sarangani Energy Corporation, Philippines
- CNBM International Corporation - China
- MS Steel International - UAE
- Rashtriya Ispat Nigam Limited - India
- Minerals Council of Australia
- TeaM Sual Corporation - Philippines
- Kartika Selabumi Mining - Indonesia
- Bulk Trading Sa - Switzerland
- Billiton Holdings Pty Ltd - Australia
- Bangladesh Power Developement Board
- Power Finance Corporation Ltd., India
- Semirara Mining and Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Economic Council, Georgia
- Coastal Gujarat Power Limited - India
- Uttam Galva Steels Limited - India
- Mercator Lines Limited - India
- Meenaskhi Energy Private Limited - India
- Bhatia International Limited - India
- ICICI Bank Limited - India
- Semirara Mining Corp, Philippines
- Romanian Commodities Exchange
- Bayan Resources Tbk. - Indonesia
- Tata Chemicals Ltd - India
- Madhucon Powers Ltd - India
- Indian Oil Corporation Limited
- Xindia Steels Limited - India
- AsiaOL BioFuels Corp., Philippines
- Iligan Light & Power Inc, Philippines
- SMC Global Power, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Mines - Canada
- Commonwealth Bank - Australia
- Chamber of Mines of South Africa
- Bukit Makmur.PT - Indonesia
- Sical Logistics Limited - India
- Videocon Industries ltd - India
- Rio Tinto Coal - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- India Bulls Power Limited - India
- Ind-Barath Power Infra Limited - India
- European Bulk Services B.V. - Netherlands
- Aditya Birla Group - India
- Vijayanagar Sugar Pvt Ltd - India
- Ministry of Finance - Indonesia
- Aboitiz Power Corporation - Philippines
- Renaissance Capital - South Africa
- Ministry of Transport, Egypt
- Anglo American - United Kingdom
- Riau Bara Harum - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Port Waratah Coal Services - Australia
- Singapore Mercantile Exchange
- Coalindo Energy - Indonesia
- The Treasury - Australian Government
- Leighton Contractors Pty Ltd - Australia
- Gujarat Sidhee Cement - India
- Ceylon Electricity Board - Sri Lanka
- Bhoruka Overseas - Indonesia
- Bharathi Cement Corporation - India
- San Jose City I Power Corp, Philippines
- Price Waterhouse Coopers - Russia
- Manunggal Multi Energi - Indonesia
- Metalloyd Limited - United Kingdom
- Timah Investasi Mineral - Indoneisa
- Mjunction Services Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Lanco Infratech Ltd - India
- Jindal Steel & Power Ltd - India
- Alfred C Toepfer International GmbH - Germany
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