Daily Archives: February 25, 2010

Sheila McNulty

The big boom in the US’ onshore shale gas play has led to an oversupply of natural gas, putting downward pressure on prices. A number of drilling programs have, therefore, been scaled back to wait until prices rise. And this has left equipment and expertise available at cheap rates for entrepreneurs to take on.

In the meantime, they are tinkering with transferring the shale gas boom into a shale oil boomlet.

Kate Mackenzie

The big renewable news in the UK today is Mitsubishi’s decision to build a  £100m offshore wind turbine R&D facility.

Much smaller, though just as interesting, is news that Siemens is among the second-round investors in Marine Current Turbines.

It’s unusual to see a big manufacturer like Siemens putting money (albeit a small amount – the total funds raised in this round were  £8.5m) in a fairly nascent renewable technology.

MCT operates the only commercial marine energy installation that is not a tidal barrage.

The UK is something of a hub for marine energy and a few utilities, such as Scottish & Southern, have invested in marine start-ups or collaborated on projects. Other investors in MCT include EDF Energy and Carbon Trust.

Kate Mackenzie

Non-Opec oil supply, depending who you ask, has either already peaked or is on the verge of doing so. But Merrill Lynch Banc of America’s Francisco Blanch and colleagues point out that last year saw some surprising growth from the non-Opec world:

ML-BAS

Source: ML-BAS

That’s not enough to turn around the general story of non-Opec decline, however.

Kate Mackenzie

On FT Energy Source:

- China’s gas-guzzling aversion leaves Hummer in the cold

- Hope returns for UK wind turbine manufacturing

- The gloom on Bloom

- Oil services companies jostle for the Iraq boom

- Europe’s decoupling oil demand

- Nigeria, Russia and Iberdrola in Energy headlines
Further reading:

- The carbon price sticking point

- Oilwatch monthly

- Russia, no longer an energy superpower

- The future of China’s carbon intensity

- Saudi Arabia, solar export

- Searching for biofuels’ sweet spot

- Not your old-style jatropha

- Pebble-bed nuclear reactor pulled

Kate Mackenzie

Barclays Capital analysts looked at fresh 2009 data from JODI, the joint initiative by Opec, the IEA and several other agencies, and found evidence that European oil demand is showing a very different pattern to Asia and America.

In the first half of the year, they wrote, all OECD regions were weak. But in the second (emphasis ours):

…the y/y decline in North American demand was a milder 0.45 mb/d, and in Asia-Pacific it was just 0.21 mb/d. In other words, the relative swing in the y/y pattern from H1 to H2 was an improvement of just over 1 mb/d in North America and of just over 0.5 mb/d in Asia-Pacific. In stark contrast, the y/y decline deepened in Europe, reaching 0.98 mb/d, which in relative terms was more than 0.5 mb/d worse than in H1.

Carola Hoyos

Iraq has created much excitement among big international (and national) oil companies, which, over the past few months, have signed a plethora of deals to develop its biggest fields. Though the deals may lead to a big boost in oil production, they are not expected to be terribly profitable for the companies.

But what about the service industry? After a tough past year during which its customers have forced through price cuts as they have slashed costs amid a weaker refining and gas price environment, will Iraq be the industry’s El Dorado?

“With much of Iraq’s infrastructure damaged or destroyed by years of war and sanctions, foreign oil-field services firms are expected to play a pivotal role in providing equipment, services and personnel,” writes Petroleum Intelligence Weekly in its current issue.

Kate Mackenzie

Does no-one in the world want big gas-guzzling cars anymore?

GM is planning to wind down the Hummer brand after plans to sell it to China’s Sichuan Tengzhong Heavy Industrial Machinery failed. Tengzhong said it couldn’t get government regulatory approval for the deal in the required time.

We understand this regulatory problem partly relates to Chinese authority’s preference for smaller, more efficient vehicles.

As a reflection of Chinese oil strategy, it’s a telling sign that China’s concerns about oil security are strong enough that it wants to actively restrain the consumption growth rate. This, as we’ve written a few times, is a key feature of the argument that oil demand may actually peak in the not-too-distant future – and that China might be taking a stronger stance on CO2 emissions than it’s letting on.

Related links:

China’s fears about imported oil (FT Energy Source)
Peak demand: going big? (FT Energy Source)
The Copenhagen positioning of China and India: Not always what it seems (FT Energy Source)

Kate Mackenzie

Petra Barnby

Photo: Petra Barnby

Will the UK, courtesy of Gamesa, once again be home to a wind turbine factory? It might be a boost for the country’s renewables scene after the departure of big Dutch turbine-maker Vestas to close its Isle of Wight facility last year. This left the country with almost no domestic wind manufacturing, despite being one of the biggest users of offshore wind (in fact few other countries, apart from Denmark, are terribly interested due to the cost and technological challenges).

The government wants to see £100bn of offshore wind developments, but has had limited success attracting investors. It insists it is offering good incentives. The problem is, so are a lot of other countries.

Kate Mackenzie

The world can breathe easy now: Bloom Energy’s star-studded launch has happened and all our energy problems are solved. Well, maybe.

We don’t want to sound too cynical. The company has some substantial backing – often a problem for new energy technologies – and it’s addressed one of the key shortcomings of fuel cells with its cheap ceramic and ink components.

But, some rather breathless coverage aside (step forward, TechCrunch), there have been a couple of good analyses of what information there is now available on the Bloom Energy Servers, which shows that we’re not about to see an energy revolution from the devices just yet.

Kate Mackenzie

Putin threatens energy-sector oligarchs (FT)

Nigeria rejects criticism of new oil policy (FT)

Iberdrola to focus on US for growth (FT)

Secretive Bloom raises the curtain (NYT)

Gamesa may open UK wind turbine factory (FT)

Vermont scuttles plans for nuclear reactor (WSJ)

Conoco’s $10bn divestiture plan seen hinging on Syncrude (Bloomberg)

Chu says US must decrease energy use (Dow Jones)

European energy giants seek lower prices from Gazprom (NYT)

Italy delays new solar plan again, industry worried (Reuters)

Argentina asks UN for help with Falklands oil row (FT)

Saudi Arabia unveils natural gas find in North (Xinhua)

Hindustan Petroleum revives $4bn refinery, chemical plan (Bloomberg)

Yar’Adua’s return to Nigeria provokes US warning (FT)

Energy Source is no longer updated but it remains open as an archive.

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