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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, 26 January 23
AUSTRALIA'S CORONADO GLOBAL SEES COAL PRICES RISING ON RESUMING CHINA IMPORTS - REUTERS
Australia’s Coronado Global Resources said on Tuesday resuming metallurgical coal imports to China would likely push sea-borne coal prices hi ...
Monday, 23 January 23
CHINA'S MAJOR COAL-PRODUCING PROVINCE ACCELERATES DIGITAL TRANSFORMATION - XINHUA
At Chindata Group’s big-data industrial park in Lingqiu County of Datong City, hundreds of thousands of servers are running round-the-clock t ...
Monday, 23 January 23
CHINA'S COAL-RICH PROVINCE SEES COAL PRODUCTION INCREASE IN 2022 - XINHUA
North China’s coal-rich province of Shanxi saw its coal production hit 1.31 billion tonnes in 2022, up 8.7 percent year on year, local author ...
Wednesday, 18 January 23
MARKET INSIGHT - INTERMODAL
From Feb 5, another price cap will be introduced to Russian fuels and oil products, adding to the one for crude oil, already in place from Dec. 3. ...
Tuesday, 17 January 23
FRAUD IS THE BIGGEST THREAT TO CARGO LOSSES - TT CLUB
The almost exclusive use of online facilities to process business transactions allows a myriad of fraudulent pursuits to find opportunities within ...
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- Sindya Power Generating Company Private Ltd
- Economic Council, Georgia
- Directorate General of MIneral and Coal - Indonesia
- Africa Commodities Group - South Africa
- Jorong Barutama Greston.PT - Indonesia
- MS Steel International - UAE
- India Bulls Power Limited - India
- Meralco Power Generation, Philippines
- IEA Clean Coal Centre - UK
- Agrawal Coal Company - India
- Star Paper Mills Limited - India
- Straits Asia Resources Limited - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Eastern Coal Council - USA
- Electricity Generating Authority of Thailand
- Standard Chartered Bank - UAE
- Directorate Of Revenue Intelligence - India
- San Jose City I Power Corp, Philippines
- LBH Netherlands Bv - Netherlands
- White Energy Company Limited
- Salva Resources Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Georgia Ports Authority, United States
- Medco Energi Mining Internasional
- Antam Resourcindo - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Oldendorff Carriers - Singapore
- Siam City Cement PLC, Thailand
- Gujarat Sidhee Cement - India
- Sarangani Energy Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Kumho Petrochemical, South Korea
- Sree Jayajothi Cements Limited - India
- IHS Mccloskey Coal Group - USA
- Pipit Mutiara Jaya. PT, Indonesia
- The Treasury - Australian Government
- GN Power Mariveles Coal Plant, Philippines
- Tata Chemicals Ltd - India
- Bukit Baiduri Energy - Indonesia
- Parliament of New Zealand
- Ambuja Cements Ltd - India
- GVK Power & Infra Limited - India
- Parry Sugars Refinery, India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kaltim Prima Coal - Indonesia
- Thai Mozambique Logistica
- Jindal Steel & Power Ltd - India
- International Coal Ventures Pvt Ltd - India
- Grasim Industreis Ltd - India
- Rio Tinto Coal - Australia
- Kapuas Tunggal Persada - Indonesia
- Altura Mining Limited, Indonesia
- Vizag Seaport Private Limited - India
- Chamber of Mines of South Africa
- Leighton Contractors Pty Ltd - Australia
- Simpson Spence & Young - Indonesia
- Malabar Cements Ltd - India
- SMC Global Power, Philippines
- Cement Manufacturers Association - India
- Australian Commodity Traders Exchange
- Vedanta Resources Plc - India
- Uttam Galva Steels Limited - India
- Ceylon Electricity Board - Sri Lanka
- Carbofer General Trading SA - India
- Therma Luzon, Inc, Philippines
- ICICI Bank Limited - India
- The University of Queensland
- Jaiprakash Power Ventures ltd
- Central Java Power - Indonesia
- McConnell Dowell - Australia
- Wilmar Investment Holdings
- Baramulti Group, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Bhatia International Limited - India
- VISA Power Limited - India
- GMR Energy Limited - India
- Energy Link Ltd, New Zealand
- Indika Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Trasteel International SA, Italy
- Neyveli Lignite Corporation Ltd, - India
- Binh Thuan Hamico - Vietnam
- Mercator Lines Limited - India
- European Bulk Services B.V. - Netherlands
- Cigading International Bulk Terminal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Orica Australia Pty. Ltd.
- PNOC Exploration Corporation - Philippines
- Australian Coal Association
- Meenaskhi Energy Private Limited - India
- Aditya Birla Group - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Petrochimia International Co. Ltd.- Taiwan
- The State Trading Corporation of India Ltd
- Manunggal Multi Energi - Indonesia
- Mercuria Energy - Indonesia
- Videocon Industries ltd - India
- Goldman Sachs - Singapore
- Latin American Coal - Colombia
- Kobexindo Tractors - Indoneisa
- Madhucon Powers Ltd - India
- Timah Investasi Mineral - Indoneisa
- Port Waratah Coal Services - Australia
- GAC Shipping (India) Pvt Ltd
- Sojitz Corporation - Japan
- Karaikal Port Pvt Ltd - India
- Interocean Group of Companies - India
- Coal and Oil Company - UAE
- Bharathi Cement Corporation - India
- Maheswari Brothers Coal Limited - India
- Krishnapatnam Port Company Ltd. - India
- Electricity Authority, New Zealand
- Marubeni Corporation - India
- Renaissance Capital - South Africa
- Ind-Barath Power Infra Limited - India
- Deloitte Consulting - India
- TNB Fuel Sdn Bhd - Malaysia
- Indian Oil Corporation Limited
- Lanco Infratech Ltd - India
- Essar Steel Hazira Ltd - India
- Bukit Makmur.PT - Indonesia
- Thiess Contractors Indonesia
- Ministry of Transport, Egypt
- Samtan Co., Ltd - South Korea
- Riau Bara Harum - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- SN Aboitiz Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Mintek Dendrill Indonesia
- Bayan Resources Tbk. - Indonesia
- Metalloyd Limited - United Kingdom
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Dalmia Cement Bharat India
- ASAPP Information Group - India
- Barasentosa Lestari - Indonesia
- Siam City Cement - Thailand
- Semirara Mining and Power Corporation, Philippines
- Edison Trading Spa - Italy
- Karbindo Abesyapradhi - Indoneisa
- Bukit Asam (Persero) Tbk - Indonesia
- Kepco SPC Power Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Savvy Resources Ltd - HongKong
- Kartika Selabumi Mining - Indonesia
- CIMB Investment Bank - Malaysia
- PTC India Limited - India
- Attock Cement Pakistan Limited
- Commonwealth Bank - Australia
- Sakthi Sugars Limited - India
- Power Finance Corporation Ltd., India
- Indo Tambangraya Megah - Indonesia
- Petron Corporation, Philippines
- Romanian Commodities Exchange
- Chettinad Cement Corporation Ltd - India
- Singapore Mercantile Exchange
- Aboitiz Power Corporation - Philippines
- Ministry of Mines - Canada
- Kideco Jaya Agung - Indonesia
- South Luzon Thermal Energy Corporation
- Bhushan Steel Limited - India
- Globalindo Alam Lestari - Indonesia
- Indian Energy Exchange, India
- Toyota Tsusho Corporation, Japan
- New Zealand Coal & Carbon
- Larsen & Toubro Limited - India
- Intertek Mineral Services - Indonesia
- Global Business Power Corporation, Philippines
- Heidelberg Cement - Germany
- Gujarat Mineral Development Corp Ltd - India
- Anglo American - United Kingdom
- Energy Development Corp, Philippines
- London Commodity Brokers - England
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bangladesh Power Developement Board
- Banpu Public Company Limited - Thailand
- Formosa Plastics Group - Taiwan
- Central Electricity Authority - India
- Posco Energy - South Korea
- AsiaOL BioFuels Corp., Philippines
- TeaM Sual Corporation - Philippines
- Borneo Indobara - Indonesia
- Planning Commission, India
- Wood Mackenzie - Singapore
- Minerals Council of Australia
- Mjunction Services Limited - India
- Orica Mining Services - Indonesia
- Tamil Nadu electricity Board
- Alfred C Toepfer International GmbH - Germany
- Vijayanagar Sugar Pvt Ltd - India
- Independent Power Producers Association of India
- Ministry of Finance - Indonesia
- Semirara Mining Corp, Philippines
- Merrill Lynch Commodities Europe
- Holcim Trading Pte Ltd - Singapore
- Global Coal Blending Company Limited - Australia
- Bhoruka Overseas - Indonesia
- Coalindo Energy - Indonesia
- Indogreen Group - Indonesia
- OPG Power Generation Pvt Ltd - India
- Makarim & Taira - Indonesia
- Bulk Trading Sa - Switzerland
- PowerSource Philippines DevCo
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Eastern Energy - Thailand
- Indonesian Coal Mining Association
- Billiton Holdings Pty Ltd - Australia
- Iligan Light & Power Inc, Philippines
- Price Waterhouse Coopers - Russia
- Pendopo Energi Batubara - Indonesia
- Sical Logistics Limited - India
- Coastal Gujarat Power Limited - India
- Xindia Steels Limited - India
- SMG Consultants - Indonesia
- CNBM International Corporation - China
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