NewBase 09-January-2023 Energy News issue - 1581 by Khaled Al Awadi.pdf

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NewBase Energy News 09 January 2023 No. 1581 Senior Editor Eng. Khaed Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Qatar, Chevron to build $6bn Ras Laffan petchem complex
GulfTimes + NewBase
QatarEnergy has announced the final investment decision (FID) with Chevron Phillips Chemical
Company (CPChem) to build the Ras Laffan Petrochemicals complex , a $6 billion integrated olefins
and polyethylene facility at Ras Laffan Industrial City.
The announcement was made in Doha in a special ceremony during which Saad Sherida Al-Kaabi,
the Minister of State for Energy Affairs, the President and CEO of QatarEnergy, and Bruce Chinn,
the President and CEO of Chevron Phillips Chemical, signed the agreement for a joint venture
company to implement the project, in which QatarEnergy will own a 70% equity share, and CPChem
will own a 30% share.
The signing ceremony was attended by Mark Lashier, the President and CEO of Phillips 66, and
senior executives from QatarEnergy and CPChem.
QatarEnergy also announced the award of the engineering, procurement, and construction (EPC)
ww.linkedin.com/in/khaled-al-awadi-80201019/

contract for the ethylene plant to SCJV, a joint
venture company between Samsung
Engineering Company of South Korea and
CTCI of Taiwan. The EPC contract for the
polyethylene plant was awarded to Maire
Tecnimont of Italy, while Emerson of the USA
was awarded the main automation contract.
The Ras Laffan Petrochemicals complex,
expected to begin production in 2026, consists
of an ethane cracker with a capacity of 2.1
million tons of ethylene per annum, making it
the largest in the Middle East and one of the
largest in the world. It also includes two
polyethylene trains with a combined output of 1.7 million tons per annum of High-Density
Polyethylene (HDPE) polymer products, raising Qatar’s overall petrochemical production capacity
to almost 14 million tons per annum.
In remarks at the signing ceremony, Saad Sherida Al-Kaabi said: “This marks QatarEnergy’s largest
investment ever in Qatar’s petrochemicals sector and the first direct investment in 12 years. It will
double our ethylene production capacity, and increase our local polymer production from 2.6 to
more than 4 million tons per annum, and place the utmost emphasis on sustainable growth and the
environment.”
“There is no doubt that this cornerstone investment in Ras Laffan Industrial City marks an important
milestone in QatarEnergy’s downstream expansion strategy. It will not only facilitate further
expansion in the downstream and petrochemical sectors in Qatar, but will also reinforce our
integrated position as a major global player in the upstream, LNG, and downstream sectors,” he
added.
“This will be further enhanced once the new world-scale petrochemical project in Orange, Texas, in
the US comes online in partnership with Chevron Phillips Chemical, executed by our joint venture
Golden Triangle Polymers Company.”
Al-Kaabi concluded his remarks by saying: “We are
delighted to enter into this exciting new venture
with Chevron Phillips Chemical – a leading and
highly respected international petrochemicals
company, and a long-term partner with whom we
have achieved many successes together building
and operating plants safely and efficiently for more
than 20 years.
“Together, our large and diverse portfolio will not
just help meet the world’s growing needs for advanced plastics and petrochemicals, but will also
enable balanced growth and facilitate human development in a responsible and sustainable
manner.”
This final investment decision comes less than two months after QatarEnergy and Chevron Phillips
Chemical took the Final Investment Decision to execute the $8.5 billion Golden Triangle Polymers
Plant on the US Gulf Coast in Texas. –

US Rejects Oil Offers in First Attempt to Replenish Stockpiles
Bloomberg + NewBase
The Biden administration is delaying the replenishment of the nation’s emergency oil reserve after
deciding the offers it received were either too expensive or didn’t meet the required specifications,
according to people familiar with the matter.
The Department of Energy rejected the several offers it got for a potential purchase in February,
said the people, who asked not to be identified as details of the process haven’t been published.
The department outlined its intention in December to begin restocking the Strategic Petroleum
Reserve, starting with a purchase of 3 million barrels next month. The plan follows the historic 180
million-barrel release of oil from the reserve ordered by President Joe Biden as he sought to tame
the high gasoline prices in the aftermath of Russia’s invasion of Ukraine.
The department will put off the purchase it had originally planned for next month, but its program,
which used a new approach that accepts fixed-price offers, will continue, one of the people said.
The Biden administration had planned to start buying crude when it dropped around $70 a barrel.
Oil fell during the fourth quarter and US benchmark prices fell close to those levels last month.
“DOE has put forth a long term plan to transition from release to replenishment, and we’re committed
to doing so in a manner that provides a fair deal for taxpayers,” the department said in a statement
Friday.
“DOE will only select bids that meet the required crude specifications and that are at a price that is
a good deal for taxpayers,” it said. “Following review of the initial submission, DOE will not be making
any award selections for the February delivery window.”
The SPR — the world’s largest emergency supply — was created in 1975 in the wake of the Arab
oil embargo.

UK to Reform Electricity Security Program to Fit Climate Goals
Bloomberg + NewBase
The UK plans to reform its flagship electricity security program to make possible its goal of a carbon-
free power grid by 2035. multiyear contracts for large consumers in order to cut demand, according
to the department for Bus iness, Energy and Industrial Strategy.
Bolstering a dwindling buffer of spare capacity is a priority for Britain after the network operator
issued several market warnings this winter. National Grid Plc was on standby to trigger a procedure
for the first time to ask households to cut consumption.
With an ambitious goal to
install 50 gigawatts of
offshore wind power by the
end of the decade, the UK
needs enough back-up to
keep the lights on when it’s
not windy.
“It’s vital that we
decarbonize our electricity
system completely by
2035,” said Dan McGrail,
chief executive officer at
industry group
RenewableUK. “We need
to incentivize more
investment in new low
carbon flexibility.”
The country’s power supply
is managed through
auctions that ensure
sufficient capacity to meet peak demand and safeguard against blackouts.
These are held four years in advance, with new-build stations able to secure 15-year contracts. This
means subsidizing fossil fuels out as far as 2040, a loophole the government wants to close.
So from 2034 there will be an emissions intensity limit to “send a clear signal” to switch to hydrogen,
use carbon-capture technology or reduce running hours, according to BEIS.
Existing deals will be unchanged but the government is looking at whether it’s better to create
managed exits for fossil fuel plants by allowing operators to start new agreements if they
decarbonize, or whether alternative support mechanisms are needed.
UK Urges Consumers to Cut Energy Use as Winter Demand Surges
Demand is set to double as transport and heating embrace electrification, increasing the importance
of secure alternative supplies on low-wind days. Back-up is likely to come from fossil fuel plants,
batteries or demand reduction. The government contracts are supposed to help keep this capacity
profitable even if it’s not needed all the time.
BEIS will now consult on the proposed reforms before outlining its final plan.

NewBase January 09 -2023 Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oil rises on demand optimism as China borders reopen
Reuters + NewBase
Oil prices climbed on Monday as the borders reopened in China, the world's top crude importer,
boosting the outlook for fuel demand growth and offsetting global recession concerns.
Brent crude futures were up $2.52, or 3.2%, at $81.09 a barrel as of 12.15 GMT, while U.S. West
Texas Intermediate crude rose $2.55, or 3.46%, to $76.32.
Hopes for less-aggressive U.S. interest rate rises are buoying financial markets and depressing the
dollar. A weaker U.S. currency makes dollar-denominated commodities more affordable for
investors holding other currencies.
Both Brent and WTI tumbled more than 8% last week, their biggest weekly declines at the start of
a year since 2016.
Oil price special
coverage

"Crude oil prices recovered from the previous week's losses as the economic reopening in China
and less aggressive monetary tightening prospects from the Federal Reserve set a positive tone for
demand recovery," said Avtar Sandu, senior manager for commodities at Phillip Futures.
As part of a "new phase" in the fight against COVID-19, China opened its borders over the weekend
for the first time in three years. Domestically, some 2 billion trips are expected during the Lunar New
Year season, nearly double last year's movement and recovering to 70% of 2019 levels, Beijing
says.
Over the last week, airlines have boosted their January international seat capacity to and from
China by 9.5% as they ramp up flights after its border opening, according to aviation data provider
Cirium.
Despite the gains in oil on Monday, concerns remain that the massive flow of Chinese travellers
may cause another surge in COVID infections, while broader economic concerns also lingered.
Those concerns are reflected in the market structure for the benchmark oil futures. Both front-month
Brent and WTI contracts are in contango, when current prices are below prices for later-delivery
contracts, which typically indicates bearish sentiment for the market. ,
"Oil prices have likely ticked up on increased confidence on China's reopening, but fears of
recession in the wider global market remains. This uncertainty will likely lead to swings in oil prices
in the near-term," said Serena Huang, Vortexa's head of APAC analysis.
Energy futures for crude oil, refined products and natural gas have plummeted in the New Year as
traders have reconsidered near-term worries over cold weather and fears of supply shortages and
dumped contracts.
Last week, U.S. energy firms cut the number of operating oil and natural gas rigs by seven, the
biggest weekly decline since September 2021, energy services firm Baker Hughes Co (BKR.O) said
on Friday.

U.S. retail gasoline prices rose in summer but ended 2022 lower
source: U.S. Energy Information Administration, Gasoline and Diesel Fuel Update
Rising crude oil prices and increased gasoline demand early in 2022 contributed to rising U.S. retail
gasoline prices in the summer, but gasoline prices ended 2022 lower than at the start of the year
because of more refinery production and less demand during the second half of the year.
The average U.S. retail price for regular-grade gasoline, the price consumers pay at the pump,
averaged $3.95 per gallon (gal) in 2022. The price hit its 2022 high at $5.01/gal in June 2022, before
decreasing to $3.09/gal at the end of the year.
At its height in mid-June, the U.S. average retail gasoline price was the highest gasoline price since
2012, when adjusted for inflation. Although the retail gasoline price increased significantly during
the middle of the year and remained elevated through the end of the summer, the U.S. average
retail gasoline price ended the year $0.19/gal lower than in the first week of 2022.
The average U.S. retail gasoline price began the year at $3.28/gal. The average price surpassed
$4.00/gal on March 7. Russia’s full-scale invasion of Ukraine in late February contributed to rising
crude oil prices and substantial uncertainty in markets for crude oil, natural gas, and petroleum
products such as gasoline.
Increased gasoline prices in the first half of the year were driven by low gasoline inventories, which
declined sharply in March and April and remained below average through November. The decrease
in inventories reflected relatively low refinery utilization in the spring, particularly when compared
with pre-pandemic levels.
High gasoline prices likely reduced gasoline consumption. Since the summer, gasoline consumption
(measured as product supplied) was less in 2022 than it was in 2021. Increased refinery
production since the summer of 2022, along with less consumption, reduced gasoline prices in the
second half of the year.
In 2022, from January 3 to December 30 retail gasoline prices decreased by $0.17/gal on the East
Coast, $0.13/gal in the Midwest, $0.26/gal on the Gulf Coast, and $0.23/gal on the West Coast.
Although gasoline prices in all regions were highest during the summer, West Coast gasoline prices
had a second increase in October related to lower refinery utilization.

ECB's Lane Says Price Pressures Won't Vanish If Energy Costs Ease
Bloomberg News Alexander Weber
European Central Bank Chief Economist Philip Lane said price pressures in the euro area will
remain elevated even if surging energy costs are starting to ease.
“This is not conclusive for the overall inflation dynamic,” Lane told a panel discussion in New
Orleans. The original energy shock resulting from Russia’s war in Ukraine and pandemic reopening
effects will feed into wages “for the next two or three years,” he said.
Euro-area inflation slowed to 9.2% in December, more than economists had predicted, according
to data released Friday. The slowdown was driven by energy, though a measure of price growth
that strips out such volatile items reached a record 5.2%.
With wage increases so far falling short of these price gains, there’s now a gap that will “keep
pressure on inflation for the next number of years,” Lane said.
Still, if the slowdown in energy costs persists, it should over time feed into “less pressure on food
inflation, less pressure on core inflation,” Lane said. “We should recognize that but, of course, we
also should recognize the uncertainty about the future path of energy prices.”
The ECB raised borrowing costs by 250 basis points last year and pledged that more hikes will
follow. Simulations show that the current level of interest rates isn’t enough to return inflation to the
2% target in a timely manner, Lane said.

“We’re quite comfortable with providing this forward guidance,” he said. “But let me also make clear,
these decisions will be data-dependent, and will follow a meeting-by-meeting approach because of
the uncertainty we face.”
NewBase Specual Coverage
The Energy world –January -01 -2023
CLEAN ENERGY
U.S Government EPA backs off plan to crack down on smog
from Permian oil drillers
By Bloomberg
The Biden administration is deferring a plan to crack down on smog in the drilling hotbed of the
Permian Basin, handing a win to oil producers along with their allies in Texas and New Mexico.
The Environmental Protection Agency had been considering formally labeling parts of the region as
violating federal air quality standards for ozone — a designation that would have spurred new
pollution curbs and potentially deterred drilling in the world’s biggest oil field.
But the administration omitted the policy from an agenda of planned regulations released late
Wednesday and instead deemed the measure “inactive,” indicating it’s not expected to be finalized
in the next six to 12 months.
The move comes after President Joe Biden exhorted oil companies to produce more crude in a bid
to keep gasoline prices in check and a spate of industry lobbying against the plan. New Mexico
officials also were concerned the designation effort would dovetail with a state legislative session
that runs through late March.

In an emailed statement, the EPA confirmed the potential Permian Basin designation is no longer
considered an active issue but signaled it could be revived later.
“If EPA decides to advance this action, EPA would initiate the redesignations process by sending a
notification letter to the appropriate state governors soliciting their input and recommendations,” the
agency said in the emailed statement. “As part of a potential redesignations effort, EPA would also
provide an opportunity for public comment on the action.”
Smog Levels
The deferral is a blow to conservationists who have called for urgent action to stem surging ground-
level ozone in the oil-drilling hotbeds that straddle the Texas-New Mexico border. The key ingredient
of smog, ozone forms when volatile organic compounds and other air pollution from smokestacks,
tailpipes and oil wells reacts with sunlight. Even at low levels, it can worsen asthma, emphysema
and other respiratory illnesses.
“The agency seems to be backing down from this critical initiative to safeguard clean air and public
health in the Permian Basin,” said Jeremy Nichols, climate and energy program director for
WildEarth Guardians. “While the Biden administration talks a good talk on public health and
environmental justice, the reality is they’re bending over backward to let the oil and gas industry
trash air quality and communities.”

Oil industry heavyweights had lobbied Biden administration officials to abandon course or at least
move more slowly on the policy, arguing that any move to redesignate parts of the Permian Basin
as violating ozone air quality standards posed grave risks to US energy and economic security.
Previously, the administration had anticipated action on the ozone nonattainment designation by
September last year.
New Mexico Environment Secretary James Kenney said he’d recently spoken with a regional EPA
official and verified the agency was not likely to start the redesignation process until after the state’s
legislative session concludes in late March. “We’d rather have the certainty of knowing that the
process has begun and that we can focus on it with all our intention and effort, and that's not possible
for us to do during the legislative session,” Kenney said.
New Mexico has not opposed the redesignation, he said, and the state has left open the possibility
of filing its own petition with the EPA asking the agency to regulate contributing pollution from the
Texas side of the Permian.
Federal law and air monitoring data “suggest we should be going down this path, and that means
tougher rules, tougher permits and more enforcement,” Kenney said. “Those are all aspects of
necessary regulation when air quality degrades as it has in the Permian Basin.”
Satellite data confirms Permian gas flaring is double what companies report
A new analysis of satellite data reveals natural gas waste and pollution in the Texas Permian Basin
is two times higher than what industry reports to the Texas Railroad Commission (RRC). In 2017
alone, Permian oil and gas operators burned enough gas to serve all the heating and cooking needs
of the state’s seven largest cities. That’s roughly $322 million dollars of natural gas that went up in
smoke.
Using National Oceanic and Atmospheric (NOAA) Earth Observation Group satellite data,
Environmental Defense Fund (EDF) analyzed flaring rates and volumes in the Permian for 2017.
The results are eye-opening. The satellite data indicates Permian operators burned 104 billion cubic
feet of natural gas—4.4 percent of all gas produced. However, industry only reported 55 billion cubic
feet of gas burned to the RRC in that same year.

It gets worse. In the Delaware Basin portion of the Permian, which accounts for about half of all gas
produced in the basin, satellite data shows operators burning almost eight percent of their gas. That
means some individual operators are wasting even more.
EDF’s analysis lines up with a recent S&P Global Market Intelligence report which also shows
significant discrepancies between industry-reported flaring data and satellite data in Texas, North
Dakota, and New Mexico. The report authors speculate whether operators “under-report flaring
activity to authorities to allow
production of much higher-
valued oil to continue.” Their
report looks at satellite data
for the entire state of Texas
and shows from 2012 to
2017, Texas wasted nearly
one trillion cubic feet through
flaring. That’s enough gas to
meet the needs of every
household in Texas for about
2 ½ years.
University Lands
We also looked at flaring performance on state-owned University Lands (UL) which leases over two
million mineral acres in the Permian Basin and is administered by the University of Texas System.
UL collects royalties on all flared gas. We wanted to see if royalty payment, and what is likely
a higher degree of lease management, correlated to better flaring performance.

The data show University Lands (UL) has a lower rate of flaring compared to the entire Permian
basin with an overall average of 2.75 percent rate of flared gas, versus the entire Permian average
of 4.4 percent.
But in the Delaware Basin, UL companies underperformed—wasting 9.68 percent of their gas,
compared to the total basin average of 7.87 percent. The Sheffield Channel leases, while a small
portion of UL’s overall production, also appear to be a problem spot in 2017 compared to other
leases in the area. It does appear that royalty collection and focused management can lead to
reduced flaring rates, but it is also clear that there is room for improvement.
What does all this mean and what can be done?
The satellite analysis indicates the RRC is working with incomplete and faulty data. The agency
needs to incorporate the NOAA satellite tool into their flaring estimates. We can’t develop good
policy or enforce existing policy with bad data. The RRC is statutorily bound to prevent waste and
pollution, and Texans have the right to know just exactly how much waste and pollution is occurring
through the extraction of our state’s natural resources.
Our previous report on Permian flaring suggested several solutions industry and the RRC should
consider, including:
 treat wasted gas as a viable resource (some companies have low rates of flaring);
 eliminate permanent flaring permits;
 require new technologies; and
 improve reporting processes and requirements.
Additionally, current law exempts flared gas from oil wells from the state’s 7.5 percent natural gas
tax. Eliminating that exemption would not only generate significant revenue for the state, it would
also create a small incentive for operators to limit their flaring.
Oil and gas industry groups have long insisted methane emission regulations are unnecessary
because the industry has the economic incentive to save their own natural gas product. Burning 8
percent of product each year undermines this argument.
Furthermore, industry insists that excessive flaring is an unfortunate byproduct of early and rapid
development in an oil field. Once we build the necessary pipelines, the flaring problem will go away,
they say. Yet, as the data show, waste and pollution from flaring in the Permian has been
consistently high since at least 2012.
The truth is, the economics of each well are built around the oil. The market and industry, left to
their own devices, is neither willing, nor able, to solve the problem in any sort of reasonable time
frame.

NewBase Energy News 09 January 2023 - Issue No. 1581 call on +971504822502, UAE
The Editor:” Khaled Al Awadi” Your partner in Energy Services
NewBase energy news is produced Twice a week and sponsored by Hawk Energy Service – Dubai, UAE.
For additional free subscriptions, please email us.
About: Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
www.linkedin.com/in/khaled-al-awadi-38b995b
Mobile: +971504822502
khdmohd@hawkenergy.net or khdmohd@hotmail.com
Those are all aspects of
necessary regulation when air
quality degrades as it has in the
Permian Basin.”

Khaled Al Awadi is a UAE National with over 30 years of experience in the Oil & Gas
sector. Has Mechanical Engineering BSc. & MSc. Degrees from leading U.S.
Universities. Currently working as self leading external Energy consultant for the
GCC area via many leading Energy Services companies. Khaled is the Founder of
the NewBase Energy news articles issues, Khaled is an international consultant,
advisor, ecopreneur and journalist with expertise in Gas & Oil pipeline Networks,
waste management, waste-to-energy, renewable energy, environment protection
and sustainable development. His geographical areas of focus include Middle East,
Africa and Asia. Khaled has successfully accomplished a wide range of projects in
the areas of Gas & Oil with extensive works on Gas Pipeline Network Facilities & gas
compressor stations. Executed projects in the designing & constructing of gas pipelines, gas metering &
regulating stations and in the engineering of gas/oil supply routes.
Has drafted & finalized many contracts/agreements in products sale, transportation, operation &
maintenance agreements. Along with many MOUs & JVs for organizations & governments authorities.
Currently dealing for biomass energy, biogas, waste-to-energy, recycling and waste management. He has
participated in numerous conferences and workshops as chairman, session chair, keynote speaker and
panelist.
Khaled is the Editor-in-Chief of NewBase Energy News and is a professional environmental writer with over
1400 popular articles to his credit. He is proactively engaged in creating mass awareness on renewable
energy, waste management, plant Automation IA and environmental sustainability in different parts of the
world. Khaled has become a reference for many of the Oil & Gas Conferences and for many Energy program
broadcasted internationally, via GCC leading satellite Channels. Khaled can be reached at any time, see
contact details above.

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NewBase 09-January-2023 Energy News issue - 1581 by Khaled Al Awadi.pdf