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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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Tuesday, 17 January 23
CHINA'S SHANXI TARGETS 2023 COAL PRODUCTION OF NEARLY 1.37B TONS - XINHUA
China’s coal-rich province of Shanxi has set a coal production target of nearly 1.37 billion metric tons for 2023, according to a government ...
Tuesday, 17 January 23
MARKET INSIGHT - INTERMODAL
Rumor has it that the New Year has come, to set the pace in, for Russia to continue hostilities against Ukraine. Ten months on the go, into Russia& ...
Tuesday, 17 January 23
INDONESIA IS ACCOUNTING FOR 32.3% OF THE GLOBAL SEABORNE COAL MARKET IN 2022 - BENCHERO COSTA
After a slow start in the first quarter, global coal trade has really picked up pace last year, and is now fully back to pre-Covid levels, Benchero ...
Tuesday, 10 January 23
INDONESIAN HBA IS SEEING A SPIKE IN JANUARY 2023 INSTEAD OF A SIGNIFICANT FALL IN DECEMBER 2022
COALspot.com: Indonesian Coal Price Reference up 8.43% in January 2023.
HBA is seeing a dramatic spike in January 2023 i ...
Sunday, 08 January 23
INDIAN COAL POWER PLANTS SHOULD BE COMPENSATED FOR 2022 FORCED GENERATION – REGULATOR : REUTERS
Indian power plants that rely on imported coal should be fully compensated when forced to supply electricity, the country’s power regulator s ...
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- Chettinad Cement Corporation Ltd - India
- Parry Sugars Refinery, India
- Latin American Coal - Colombia
- Global Business Power Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Gujarat Electricity Regulatory Commission - India
- Power Finance Corporation Ltd., India
- Semirara Mining and Power Corporation, Philippines
- Meralco Power Generation, Philippines
- Ministry of Mines - Canada
- Orica Australia Pty. Ltd.
- Formosa Plastics Group - Taiwan
- Attock Cement Pakistan Limited
- Global Green Power PLC Corporation, Philippines
- Agrawal Coal Company - India
- Siam City Cement - Thailand
- Savvy Resources Ltd - HongKong
- Riau Bara Harum - Indonesia
- Vedanta Resources Plc - India
- Goldman Sachs - Singapore
- PowerSource Philippines DevCo
- Energy Development Corp, Philippines
- Mercuria Energy - Indonesia
- San Jose City I Power Corp, Philippines
- The Treasury - Australian Government
- Georgia Ports Authority, United States
- Indian Oil Corporation Limited
- Marubeni Corporation - India
- Sarangani Energy Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Sakthi Sugars Limited - India
- CIMB Investment Bank - Malaysia
- Kumho Petrochemical, South Korea
- PetroVietnam Power Coal Import and Supply Company
- Bhushan Steel Limited - India
- Eastern Coal Council - USA
- Planning Commission, India
- Wood Mackenzie - Singapore
- Aditya Birla Group - India
- Anglo American - United Kingdom
- IHS Mccloskey Coal Group - USA
- Central Java Power - Indonesia
- Edison Trading Spa - Italy
- Vizag Seaport Private Limited - India
- Thiess Contractors Indonesia
- Indonesian Coal Mining Association
- Gujarat Sidhee Cement - India
- Makarim & Taira - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- AsiaOL BioFuels Corp., Philippines
- Wilmar Investment Holdings
- The University of Queensland
- Directorate Of Revenue Intelligence - India
- Leighton Contractors Pty Ltd - Australia
- Economic Council, Georgia
- Binh Thuan Hamico - Vietnam
- Antam Resourcindo - Indonesia
- European Bulk Services B.V. - Netherlands
- Commonwealth Bank - Australia
- India Bulls Power Limited - India
- Gujarat Mineral Development Corp Ltd - India
- South Luzon Thermal Energy Corporation
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PNOC Exploration Corporation - Philippines
- Central Electricity Authority - India
- Malabar Cements Ltd - India
- Thai Mozambique Logistica
- Indika Energy - Indonesia
- Sree Jayajothi Cements Limited - India
- Essar Steel Hazira Ltd - India
- McConnell Dowell - Australia
- Mercator Lines Limited - India
- Energy Link Ltd, New Zealand
- Siam City Cement PLC, Thailand
- Kepco SPC Power Corporation, Philippines
- Parliament of New Zealand
- Renaissance Capital - South Africa
- Coal and Oil Company - UAE
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mintek Dendrill Indonesia
- Deloitte Consulting - India
- Rio Tinto Coal - Australia
- Aboitiz Power Corporation - Philippines
- IEA Clean Coal Centre - UK
- Borneo Indobara - Indonesia
- Romanian Commodities Exchange
- New Zealand Coal & Carbon
- TNB Fuel Sdn Bhd - Malaysia
- Jaiprakash Power Ventures ltd
- Billiton Holdings Pty Ltd - Australia
- Singapore Mercantile Exchange
- Mjunction Services Limited - India
- Timah Investasi Mineral - Indoneisa
- Sinarmas Energy and Mining - Indonesia
- TeaM Sual Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Coalindo Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Metalloyd Limited - United Kingdom
- Salva Resources Pvt Ltd - India
- Xindia Steels Limited - India
- GMR Energy Limited - India
- Posco Energy - South Korea
- Barasentosa Lestari - Indonesia
- Bukit Baiduri Energy - Indonesia
- London Commodity Brokers - England
- Larsen & Toubro Limited - India
- SMC Global Power, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Chamber of Mines of South Africa
- Bayan Resources Tbk. - Indonesia
- Trasteel International SA, Italy
- Alfred C Toepfer International GmbH - Germany
- CNBM International Corporation - China
- Price Waterhouse Coopers - Russia
- Orica Mining Services - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Indogreen Group - Indonesia
- Altura Mining Limited, Indonesia
- Medco Energi Mining Internasional
- Heidelberg Cement - Germany
- Petrochimia International Co. Ltd.- Taiwan
- White Energy Company Limited
- Iligan Light & Power Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Independent Power Producers Association of India
- Dalmia Cement Bharat India
- Bhatia International Limited - India
- Videocon Industries ltd - India
- VISA Power Limited - India
- Baramulti Group, Indonesia
- Australian Commodity Traders Exchange
- Asmin Koalindo Tuhup - Indonesia
- Maheswari Brothers Coal Limited - India
- Australian Coal Association
- Pendopo Energi Batubara - Indonesia
- Cement Manufacturers Association - India
- SN Aboitiz Power Inc, Philippines
- Ambuja Cements Ltd - India
- Bulk Trading Sa - Switzerland
- International Coal Ventures Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Holcim Trading Pte Ltd - Singapore
- Electricity Generating Authority of Thailand
- Merrill Lynch Commodities Europe
- Electricity Authority, New Zealand
- Ministry of Finance - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Petron Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- SMG Consultants - Indonesia
- GVK Power & Infra Limited - India
- Kartika Selabumi Mining - Indonesia
- Toyota Tsusho Corporation, Japan
- Samtan Co., Ltd - South Korea
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jorong Barutama Greston.PT - Indonesia
- Grasim Industreis Ltd - India
- Minerals Council of Australia
- ICICI Bank Limited - India
- Standard Chartered Bank - UAE
- Coastal Gujarat Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- ASAPP Information Group - India
- Eastern Energy - Thailand
- Directorate General of MIneral and Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kobexindo Tractors - Indoneisa
- Straits Asia Resources Limited - Singapore
- Star Paper Mills Limited - India
- Carbofer General Trading SA - India
- Kideco Jaya Agung - Indonesia
- Semirara Mining Corp, Philippines
- Lanco Infratech Ltd - India
- Bukit Makmur.PT - Indonesia
- Sical Logistics Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Simpson Spence & Young - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Global Coal Blending Company Limited - Australia
- Maharashtra Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Oldendorff Carriers - Singapore
- GAC Shipping (India) Pvt Ltd
- Port Waratah Coal Services - Australia
- Intertek Mineral Services - Indonesia
- Therma Luzon, Inc, Philippines
- The State Trading Corporation of India Ltd
- Bangladesh Power Developement Board
- Karbindo Abesyapradhi - Indoneisa
- Kaltim Prima Coal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Madhucon Powers Ltd - India
- Jindal Steel & Power Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- MS Steel International - UAE
- Kapuas Tunggal Persada - Indonesia
- LBH Netherlands Bv - Netherlands
- Karaikal Port Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Africa Commodities Group - South Africa
- Interocean Group of Companies - India
- OPG Power Generation Pvt Ltd - India
- Ministry of Transport, Egypt
- Sojitz Corporation - Japan
- PTC India Limited - India
- Bharathi Cement Corporation - India
- Ind-Barath Power Infra Limited - India
- Tamil Nadu electricity Board
- Bhoruka Overseas - Indonesia
- Indian Energy Exchange, India
- Globalindo Alam Lestari - Indonesia
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