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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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Saturday, 18 February 23
PAKISTAN PLANS TO QUADRUPLE DOMESTIC COAL-FIRED POWER, MOVE AWAY FROM GAS - REUTERS
Pakistan plans to quadruple its domestic coal-fired capacity to reduce power generation costs and will not build new gas-fired plants in the coming ...
Saturday, 18 February 23
2023 MARINE FUEL MARKET PREDICTIONS - JOHN BERGMAN, AURAMARINE
The drive for decarbonisation we witnessed in 2022 has continued into 2023, demonstrating the shipping’s industry positive strides in the fas ...
Saturday, 28 January 23
COAL GROWTH BLIP NOT TO BE REPEATED - BALTIC EXCHANGE
As 2022 drew to a close, global coal demand looked set to end the year just 1.2% up on the previous year. But that small increase was enough to pus ...
Thursday, 26 January 23
CHINA'S COAL OUTPUT INCREASES IN DECEMBER 2022 - XINHUA
China’s raw coal output posted stable expansion in December 2022, official data showed.
The country produced 400 million tonne ...
Thursday, 26 January 23
COKING COAL NARROWS THE GAP ON THERMAL AS CHINA REOPENS - REUTERS
The premium of high-grade thermal coal over coking coal in Asia is shrinking as China’s re-opening and ending of a ban on imports from Austra ...
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- Iligan Light & Power Inc, Philippines
- Gujarat Electricity Regulatory Commission - India
- Grasim Industreis Ltd - India
- Ambuja Cements Ltd - India
- Posco Energy - South Korea
- Ministry of Mines - Canada
- Meenaskhi Energy Private Limited - India
- Georgia Ports Authority, United States
- Neyveli Lignite Corporation Ltd, - India
- Jorong Barutama Greston.PT - Indonesia
- Electricity Generating Authority of Thailand
- GVK Power & Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Goldman Sachs - Singapore
- Bhatia International Limited - India
- OPG Power Generation Pvt Ltd - India
- VISA Power Limited - India
- Edison Trading Spa - Italy
- Kalimantan Lumbung Energi - Indonesia
- Sarangani Energy Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Carbofer General Trading SA - India
- Energy Development Corp, Philippines
- Bangladesh Power Developement Board
- Meralco Power Generation, Philippines
- Karaikal Port Pvt Ltd - India
- Mintek Dendrill Indonesia
- Electricity Authority, New Zealand
- Pendopo Energi Batubara - Indonesia
- Maheswari Brothers Coal Limited - India
- ICICI Bank Limited - India
- Barasentosa Lestari - Indonesia
- Chamber of Mines of South Africa
- Bharathi Cement Corporation - India
- Star Paper Mills Limited - India
- Independent Power Producers Association of India
- Uttam Galva Steels Limited - India
- Essar Steel Hazira Ltd - India
- Renaissance Capital - South Africa
- IHS Mccloskey Coal Group - USA
- Jindal Steel & Power Ltd - India
- Port Waratah Coal Services - Australia
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Directorate Of Revenue Intelligence - India
- Bayan Resources Tbk. - Indonesia
- International Coal Ventures Pvt Ltd - India
- Agrawal Coal Company - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- PTC India Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Samtan Co., Ltd - South Korea
- Vizag Seaport Private Limited - India
- Coal and Oil Company - UAE
- Siam City Cement PLC, Thailand
- Intertek Mineral Services - Indonesia
- Mercator Lines Limited - India
- CIMB Investment Bank - Malaysia
- Sakthi Sugars Limited - India
- Globalindo Alam Lestari - Indonesia
- Tata Chemicals Ltd - India
- Aboitiz Power Corporation - Philippines
- Indika Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Mercuria Energy - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Energy Link Ltd, New Zealand
- SN Aboitiz Power Inc, Philippines
- Singapore Mercantile Exchange
- Trasteel International SA, Italy
- Kartika Selabumi Mining - Indonesia
- Australian Commodity Traders Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Deloitte Consulting - India
- TNB Fuel Sdn Bhd - Malaysia
- Semirara Mining Corp, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Videocon Industries ltd - India
- Kobexindo Tractors - Indoneisa
- Asmin Koalindo Tuhup - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Sical Logistics Limited - India
- MS Steel International - UAE
- Altura Mining Limited, Indonesia
- Coalindo Energy - Indonesia
- Dalmia Cement Bharat India
- Parry Sugars Refinery, India
- Orica Australia Pty. Ltd.
- Cigading International Bulk Terminal - Indonesia
- Lanco Infratech Ltd - India
- The University of Queensland
- GN Power Mariveles Coal Plant, Philippines
- Eastern Coal Council - USA
- Sindya Power Generating Company Private Ltd
- New Zealand Coal & Carbon
- Sree Jayajothi Cements Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Kideco Jaya Agung - Indonesia
- Indonesian Coal Mining Association
- Banpu Public Company Limited - Thailand
- Kumho Petrochemical, South Korea
- SMC Global Power, Philippines
- Attock Cement Pakistan Limited
- Coastal Gujarat Power Limited - India
- Riau Bara Harum - Indonesia
- IEA Clean Coal Centre - UK
- Orica Mining Services - Indonesia
- Marubeni Corporation - India
- The State Trading Corporation of India Ltd
- Indogreen Group - Indonesia
- Planning Commission, India
- GAC Shipping (India) Pvt Ltd
- South Luzon Thermal Energy Corporation
- Vedanta Resources Plc - India
- Miang Besar Coal Terminal - Indonesia
- Standard Chartered Bank - UAE
- Timah Investasi Mineral - Indoneisa
- White Energy Company Limited
- London Commodity Brokers - England
- Holcim Trading Pte Ltd - Singapore
- Global Coal Blending Company Limited - Australia
- Xindia Steels Limited - India
- Larsen & Toubro Limited - India
- TeaM Sual Corporation - Philippines
- Jaiprakash Power Ventures ltd
- ASAPP Information Group - India
- Ministry of Finance - Indonesia
- Medco Energi Mining Internasional
- PowerSource Philippines DevCo
- SMG Consultants - Indonesia
- Cement Manufacturers Association - India
- Minerals Council of Australia
- Binh Thuan Hamico - Vietnam
- Parliament of New Zealand
- Central Electricity Authority - India
- Makarim & Taira - Indonesia
- Commonwealth Bank - Australia
- Merrill Lynch Commodities Europe
- Savvy Resources Ltd - HongKong
- PNOC Exploration Corporation - Philippines
- Petron Corporation, Philippines
- Central Java Power - Indonesia
- Siam City Cement - Thailand
- India Bulls Power Limited - India
- Madhucon Powers Ltd - India
- Toyota Tsusho Corporation, Japan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Indian Oil Corporation Limited
- Ministry of Transport, Egypt
- Wilmar Investment Holdings
- European Bulk Services B.V. - Netherlands
- Baramulti Group, Indonesia
- Bukit Makmur.PT - Indonesia
- Price Waterhouse Coopers - Russia
- Antam Resourcindo - Indonesia
- Simpson Spence & Young - Indonesia
- LBH Netherlands Bv - Netherlands
- Gujarat Sidhee Cement - India
- GMR Energy Limited - India
- Romanian Commodities Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indo Tambangraya Megah - Indonesia
- The Treasury - Australian Government
- Alfred C Toepfer International GmbH - Germany
- Kepco SPC Power Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Semirara Mining and Power Corporation, Philippines
- Mjunction Services Limited - India
- Kaltim Prima Coal - Indonesia
- Bhoruka Overseas - Indonesia
- Tamil Nadu electricity Board
- McConnell Dowell - Australia
- Ind-Barath Power Infra Limited - India
- Thiess Contractors Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kohat Cement Company Ltd. - Pakistan
- Eastern Energy - Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Aditya Birla Group - India
- Ceylon Electricity Board - Sri Lanka
- Economic Council, Georgia
- Manunggal Multi Energi - Indonesia
- Sojitz Corporation - Japan
- AsiaOL BioFuels Corp., Philippines
- Kapuas Tunggal Persada - Indonesia
- Chettinad Cement Corporation Ltd - India
- Interocean Group of Companies - India
- Directorate General of MIneral and Coal - Indonesia
- Anglo American - United Kingdom
- San Jose City I Power Corp, Philippines
- Oldendorff Carriers - Singapore
- Australian Coal Association
- Thai Mozambique Logistica
- Borneo Indobara - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Africa Commodities Group - South Africa
- Leighton Contractors Pty Ltd - Australia
- Bhushan Steel Limited - India
- Latin American Coal - Colombia
- Global Business Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Krishnapatnam Port Company Ltd. - India
- Straits Asia Resources Limited - Singapore
- Metalloyd Limited - United Kingdom
- Power Finance Corporation Ltd., India
- Bulk Trading Sa - Switzerland
- Indian Energy Exchange, India
- Heidelberg Cement - Germany
- Salva Resources Pvt Ltd - India
- Rio Tinto Coal - Australia
- Malabar Cements Ltd - India
- Therma Luzon, Inc, Philippines
- CNBM International Corporation - China
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