SINGAPORE: Oiltanking sells 45% of stake in Helios Terminal for undisclosed sum

(EnergyAsia, August 14 2013, Wednesday) — After less than a year of full ownership, Germany’s Oiltanking GmbH said it has agreed to sell 45% of its stake in Singapore’s Helios Terminal Corporation Pte Ltd to Macquarie Capital for an undisclosed sum.

The proposed sale of Helios, which owns and operates a world-class fuel oil storage terminal on Asia’s main oil and petrochemicals hub on Jurong Island, is subject to regulatory approval.

Equipped to handle very large crude carriers, the terminal includes 18 tanks with a total 503,000-cubic-metre capacity to store and blend fuel oil operated to the highest technical, operational and environmental standards.

Oiltanking said it has been looking for a long-term partner since acquiring Helios last October.

It described Macquarie Capital as an excellent strategic fit given the company’s investment focus, access to institutional capital and financial market capabilities.

Oiltanking GmbH, a subsidiary of privately owned Marquard & Bahls AG, is the world’s second largest independent tank storage provider for petroleum products, chemicals and gases. The company owns and operates 73 terminals in 23 countries in Europe, North and South America, Middle East, Africa and Asia.

Macquarie Capital offers expertise across a range of advisory and capital raising services including corporate finance and advisory, equity and debt capital markets, private equity placements and principal investments.

ASIA: Tajikistan and Kyrgyzstan adding refining capacity

(EnergyAsia, July 30 2013, Tuesday) — Central Asia’s fuel-short economies will have two new oil refineries by next month after Kyrgyzstan starts up an 800,000-ton/year plant to follow on Tajikistan’s recent launch of a 100,000-ton/year plant.

The refineries will help the region’s fast-growing economies reduce dependence on imports of gasoline, diesel and fuel oil.

In launching his country’s second oil refinery on July 20, Tajik President Emomali Rahmon announced plans to triple its capacity to 300,000 tons by the end of next year. The refinery, located in Tursunzoda city in Shahrinav district some 50 km west of the capital city of Dushanbe, will process mostly imported crude oil from Russia.

In March, the landlocked country started up its first refinery with the capacity to process 50,000 tons per year. There are plans to build a third mini refinery with the capacity to process 1.2 million tons/year.

Tajikistan’s economy grew an average rate of more than 9% between 2000 and 2007 before slowing down to around 7.5% the last two years.

Kyrgyzstan expects to meet the bulk of its domestic fuel demand when it starts up its third and largest oil refinery in the northern city of Kara-Balta next month. The Economy and Industry Ministry said it expects domestic fuel prices to drop as the country would reduce import of expensive imports from Russia and Kazakhstan.

China, which is backing the Kara-Balta project, is in talks to help a fourth refinery to add to Kyrgyzstan’s existing two at Jalal-Abad (400,000 tonnes/year) and at Kant (200,000 tonnes).


VIETNAM: Green groups praise US Ex-Im Bank for not funding coal-fired power plant

(EnergyAsia, July 24 2013, Wednesday) — Environmentalists have hailed the US Export-Import Bank’s decision to reject financing the construction of a proposed coal-fired power plant in Vietnam.

The bank’s board voted last week to reject financing for the 1,200MW Thai Binh II coal plant in the Red River Delta in northern Vietnam.

“The Thai Binh II coal plant would use outmoded subcritical boiler technology, a violation of your Climate Action Plan and the Export-Import Bank’s environment policy. As such, this dirty coal plant will emit unacceptable air pollution that will worsen climate disruption and poison local communities,” said a joint statement by five environmental groups, which include Friends of the Earth (FOE), Greenpeace USA, Pacific Environment, Center for International Environmental Law and Center for Biological Diversity.

The groups wrote to President Barack Obama asking that he intervene to reject the project as “funding the plant would be a clear violation of both the president’s climate action plan and the Ex-Im Bank’s own environmental policy”.

Separately, FOE said it showed that the Obama administration is keeping its promise to fight climate change while the Sierra Cub said the decision means that Vietnam and other developing countries won’t be “saddled with the health and environmental costs of dirty coal.”

Damon Moglen, FOE’s senior strategic advisor, said:

“Friends of the Earth commends the Obama Administration for rejecting financing for this dirty power plant, and believe it bodes well for the implementation of the President’s ban on public financing for overseas coal deals.

“We urge Ex-Im and other government agencies to ensure that the spirit and intent of this commitment is upheld, and not weakened by fine print and loopholes. With this momentum, the president should now encourage these institutions to support investment in renewable energy, efficiency technologies and energy storage so as to assure that we have a real, clean 21st century energy future.”

Sierra Club International Climate Program Representative Justin Guay said the “decision to reject funding for a new coal plant in Vietnam clearly upholds the spirit of President Obama’s new Climate Action Plan.

“The President has made it clear that U.S taxpayer money should not be funding dirty, dangerous coal projects abroad, and we are hopeful that this vote is the first step in Ex-Im turning the corner on their record-breaking financing of dirty fossil fuels.

“Ex-Im should adopt a moratorium on financing for overseas coal projects, consistent with the President’s climate plan, ensuring that developing countries aren’t saddled with the health and environmental costs of dirty coal.”


AUSTRALIA: LNG industry disadvantaged by government’s carbon pricing, says petroleum association

(EnergyAsia, July 23 2013, Tuesday) — The Australia government’s decision to continue with a carbon price on the energy and mining sector puts its liquefied natural gas (LNG) industry at a big disadvantage against suppliers in other countries, said the Australian Petroleum Production Exploration Association (APPEA). The controversial carbon tax was introduced at a fixed…

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SINGAPORE: Global Pacific’s 19th Asia Oil Week to focus on new E&P opportunities in Asia

(EnergyAsia, July 11 2013, Thursday) — Global Pacific & Partners will unveil new exploration, production and development business opportunities in the Asia Pacific region at its upcoming 19th Asia Oil Week event in Singapore on October 3-4. The landmark event for Asia’s upstream oil and gas industry brings together keynote speakers from all over the…

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SINGAPORE: Could Pavilion Gas be next to buy into Canada’s gas boom through Petronas?

(EnergyAsia, July 10 2013, Wednesday) — Could Singapore’s newly established Pavilion Gas be next to buy into Canada’s natural gas boom through an equity stake in Petronas’s Pacific NorthWest LNG?

The subsidiary of Singapore sovereign wealth fund Temasek Holdings was established in May with an initial capital of S$1.25 million to focus on buying, marketing and selling natural gas. (US$1=S$1.28).

Temasek has named senior managing director Seah Moon Ming as CEO of the new company as well as Pavilion Energy, which looks after non-gas energy businesses.

Since taking over Calgary-based Progress Energy last December, Malaysian state energy firm Petronas has shown some neat moves in advancing the development of its proposed US$16 billion liquefied natural gas (LNG) project. In the seven months since Ottawa approved the US$5.9 billion takeover of Progress, Petronas has formed Pacific NorthWest LNG for the purpose of developing natural gas reserves in BC, tying up supply deals, building an export terminal and securing long-term purchase agreements with customers in Asia.

PacificNorthWest has raced ahead of its various rivals who have tabled at least 10 proposals to develop export-oriented LNG projects from locations near or at Kitimat and Prince Rupert. It has sold a 10% equity stake to Japan’s Japex, which has also committed to buying up a certain volume from the proposed 12-million-tonne/year terminal.

This is a proven strategy for companies building large capital-intensive projects as they greatly reduce risks by bringing in equity partners who will double up as customers, ensuring that they don’t have to fight the competition for future sales. The “we’re all in this together” strategy has been tested and proved in developing the LNG industry in Australia and the Middle East.

Petronas is continuing talks to recruit others into the project, with Reuters reporting that it is hoping to close a deal with state-owned Indian Oil Corp.

Pavilion Gas and SembCorp, both subsidiaries of Temasek, could fit the bill too, given that Singapore has just started up its new import terminal and needs to build up a supply chain and gas reserves abroad. Pavilion Gas has made clear that LNG will be a major part of its focus while SembCorp owns and operates power plants in Singapore and elsewhere.

Also, Hassan Marican, the former CEO of Petronas, is chairman of S$1-billion sister company Pavilion Energy and sits on the boards of SembCorp and Singapore Power.

For the financial year ending March 31 2013, Temasek said it made net investments of S$4 billion in the energy and resources sector. The company raised its stake in Spain’s Repsol to 6.3% as well as bought into Kunlun Energy, the listed natural gas subsidiary of state-owned PetroChina and US-based LNG terminal operator Cheniere Energy.


AUSTRALIA: Cokal to raise A$9.6 million in share sale to Singapore’s Blumont Group

(EnergyAsia, July 10 2013, Wednesday) — Australian metallurgical coal miner Cokal Limited said it will raise A$9,609,125.44 from selling shares to Singapore investment company Blumont Group over the next four months. (US$1=A$1.07).

The Australia-listed miner said it will sell a total of 60,057,034 fully paid ordinary shares at A$0.16 each in five tranches between July and November. The money will help pay for a feasibility study to develop the Bumi Barito Mineral (BBM) project in Indonesia’s Central Kalimantan that could begin producing coal from next year.

Cokal owns a 60% stake in the project which it believes holds at least 77 million tonnes of coal reserves. Indonesian companies own the remaining 40%.

Cokal’s executive chairman Peter Lynch said:

“The placement to Blumont will provide sufficient funds to complete the drilling programme and the definitive feasibility study for BBM project.”

Singapore-listed Blumont, which has a market capitalisation of S$2 billion, owns an 11.48% its stake in another Australia-listed miner, Celsius Coal.


IRAN: Hard fight to keep customers as US insists oil markets remain well supplied

(EnergyAsia, July 10 2013, Wednesday) — Iran faces an uphill battle to keep its oil customers as the US and its allies insist the markets are well supplied while further tightening trade and financial sanctions against the Islamic regime for pursuing its nuclear energy programme. In an interview with Reuters last month, US Energy Secretary…

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IRAN: Bilateral trade with India seen rising despite Western sanctions

(EnergyAsia, July 9 2013, Tuesday) — Both facing serious domestic economic challenges, Iran and India expect their bilateral trade to continue growing despite the weight of trade and financial sanctions imposed by the West on Tehran and its trading partners. Iran is holding onto its main oil customers in Asia, while India, faced with its…

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AUSTRALIA: Coal industry to contribute A$43 billion to domestic economy and employ 180,000 people this year

(EnergyAsia, July 9 2013, Tuesday) — The coal industry will contribute about A$43 billion to the Australian economy this year and provide 180,000 direct and indirect jobs, said the Australian Coal Association (ACA). (US$1=A$1.07).

The association recently revealed these and other figures contained in a special study that it had commissioned to counter a growing national campaign by green groups to shut down the industry.

The study, “The Australian Coal Industry-adding value to the Australian Economy”, was written by Professor Sinclair Davidson and senior lecturer Ashton De Silva of the School of Economics, Finance and Marketing at RMIT University.

The study’s main findings include:

– The ‘coal economy’ made up 3.1% of gross value added (worth around $43 billion) in 2011-12 rising by 18.25% since 2006-07. This is a supply side measure.

– The broader ‘coal economy’, including both supply-side and demand-side considerations, made up 4.2% of gross value added (worth almost A$60 billion) in 2011-12.

– For every job created in coal mining, 3.7 jobs are created nationally in the Australian economy, making up a direct and indirect workforce of more than 180,000 people in 2011-12.

– For every million dollars of output in coal mining, the coal economy would see 3.2 jobs being created as a result of the extraction of coal and investment in new and improved capacity.

– The coal extraction industry made up 1.8% of gross value added in 2011-12 up from 1.5% in 2006-2007.

In a joint statement, the authors said:

“Over the past 30 years, coal has been one of Australia’s major export industries. In fact, for most of that period it was the major export industry. Coal represents the main export earner for both Queensland and New South Wales states.

“The modern Australian economy is highly dependent on access to reliable and relatively cheap electricity-coal mining in particular, and the coal economy in general, underpins our prosperity.”

It follows a key Reserve Bank of Australia working paper, published in February 2013, which found that the wider resource economy accounted for 18% of gross value added in 2011-2012.

ACA CEO, Nikki Williams said the report shows the extent to which the coal industry is embedded in the Australian economy.

“It is a reality that coal for power generation and steel manufacture has built our modern Australia and is now helping other countries to improve the quality of life of their people by reducing energy poverty,” she said.

“This indisputable fact is not widely understood. The long-term outlook for coal remains strong. We need to ensure that our sector remains internationally competitive to ensure that Australia benefits from the sustainable development of its coal resources.”

IRAN: Security officials meet Chinese counterparts as Syria, Egypt crises threaten regional stability

(EnergyAsia, July 9 2013, Tuesday) — Iranian security officials met their Chinese counterparts in Beijing and Shanghai last week as the recent escalation of violence and conflict in the Middle East along with cyber-hacking threaten geopolitical stability across the region and Asia. Iranian Interior Minister Mostafa Mohammad Najjar met Public Security Minister Guo Shengkun as…

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CANADA: Petronas subsidiary applies to export 19.68 million tonnes/year of LNG from Port Edward terminal

(EnergyAsia, July 8 2013, Monday) — The Canadian subsidiary of Malaysia’s state energy firm Petronas said it has applied for a licence for the annual export of 19.68 million tonnes of liquefied natural gas (LNG) from its proposed terminal in western British Columbia province.

Pacific NorthWest LNG has applied to the National Energy Board (NEB) to begin export from the 12-million-tonne Port Edward terminal from 2019 for 25 years. Expected to cost between C$9 billion and C$11 billion, the project will create up to 3,500 direct jobs during construction, the company said.

Once operational, the LNG facility, which is 90% owned by Petronas and 10% by Japan’s Japex, will create 200 to 300 permanent, full-time jobs.

The plant will be supplied with natural gas sourced primarily from reserves owned by Progress Energy Canada in northeast British Columbia. Petronas bought Calgary-based Progress Energy in a C$6-billion friendly deal last year.

Greg Kist, Pacific NorthWest LNG’s president, said:

“While we continue our work to reach a final investment decision in late 2014, we believe that our project has all of the key components of a successful, world-class LNG development.”

British Columbia’s Premier Christy Clark said:

“Pacific NorthWest LNG’s export application is more welcome news, which will help us achieve our goal to be a leader in clean energy supply and export.

“Our ability to reach new markets will enable British Columbia’s natural gas to create new jobs, strengthen our economy, and lead to a debt-free future.”


AUSTRALIA: Coal association welcomes IEA endorsement of carbon capture and storage technology, slams green groups

(EnergyAsia, July 8 2013, Monday) —- The Australian Coal Association (ACA) has welcomed the International Energy Agency’s (IEA) endorsement of carbon capture and storage (CCS) technology as a key solution in reducing greenhouse gas emissions to fight climate change.

In a landmark report, released last week, “Technology Roadmap: Carbon Capture and Storage”, the IEA predicts that by 2050, the technology could account for 17% of total emissions reductions needed to limit the increase in average global temperatures to 2⁰C.

The IEA has set a target for the world to launch at least 30 demonstration projects across different sectors by 2020 and to use the technology in power generation and industry to reduce carbon dioxide emissions by over 2,000 million tonnes per year by 2030. The Paris-based agency also wants the technology deployed in all on-site processes throughout the world by 2050 that would lead to the storage of over seven billion tonnes of carbon dioxide per year, equal to China’s total annual emissions.

“The IEA highlights that CCS technology will be part of a range of low emissions technologies needed to lower world carbon dioxide emissions while satisfying growing energy demand,” said the association’s CEO, Nikki Williams, who criticised environmentalists for rejecting and attacking the use of CCS technology.

“It’s time for activists to recognise that CCS technology must be part of the world’s low carbon future. CCS will remain a critical greenhouse gas reduction solution, due to the role of fossil fuels and carbon-intensive industries in world economies.”

According to the IEA, 70% of CCS projects need to be implemented in emerging economies where the growth of energy demand is greatest.

Last week, US President Obama announced up to US$8 billion in loan guarantees for CCS projects as part of his “Climate Change Action Plan”.

US Energy Secretary Ernest Moniz said: “The President made clear that we anticipate that coal and other fossil fuels are going to play a significant role for quite some time on the way to a very low carbon economy.”

While CCS development and deployment would not happen immediately, he said that “we will have demonstrated the viability of large-scale storage” of carbon dioxide from industrial operations this decade.

The Australian Coal Association said it is supporting the development of CCS and other low emissions technologies through its Coal21 technology programme, which has so far invested $265 million in 10 research and development projects.



AUSTRALIA: Greenpeace lists 91 “unaffordable” coal projects, while association slams climate commission

(EnergyAsia, July 5 2013, Friday) — Australia “cannot afford” to develop 91 coal projects that will change the climate, warns Greenpeace, while the industry’s world association has criticised the country’s climate commission for being driven by “ideology”.

In a special report, Greenpeace provides details of the 91 new coal projects planned for Australia, with a warning from one of the country’s top climate scientists, Professor Lesley Hughes:

“We simply have to leave about 80% of the world’s fossil fuel reserves in the ground. We cannot afford to burn them and still have a stable and safe climate.”

According to Greenpeace, the planners for the 91 projects in Queensland and New South Wales states aim to ramp up production to 2018 to add to the 100 black coal mines already in operation.

“If these new projects operate at capacity, they would produce a massive 604 million tonnes of coal per year,” said the non-profit green group.

“When this coal is burnt, this would create an additional 1.5 gigatons of carbon dioxide annually. That’s nearly three times the amount of greenhouse gases Australia currently emits every year.”

This news came off the back of a new report from the Climate Commission entitled “The Critical Decade 2013.”

Greenpeace said the projected numbers fly in the face of what science is telling us to do.

It said: “The International Energy Agency (IEA) has said that to meet the two degree goal, global demand for coal must peak in 2016 and decline annually from then on.

“Australia has committed to not allow global average temperatures to rise by more than two degrees above pre-industrial levels. This commitment has support from both sides of politics.

“Our politicians have a choice between coal and the world we hand to our children. We cannot protect Australia from the consequences of dangerous climate change and continue expanding our coal industry. Our political leaders have so far failed to respond to urgent threat to the future of the country posed by an expanded coal industry.”

Greenpeace said that if these 91 projects are built, they would significantly add to already dangerous levels of global warming. These are the projects that must be halted if we’re to meet our climate change commitments, and protect the future wellbeing of the country.

Taking the opposite stance, the World Coal Association (WCA) said Australia’s Climate Commission (ACC) has published a report, “The Critical Decade 2013: Climate Change Science, Risk & Response,” that is driven by ideology.

The report calls for the Australian coal industry to be restructured to reduce its carbon emissions.

Milton Catelin, the WCA’s CEO, said:

“The Climate Commission report brings no intellectual rigour to analysing coal. It can be said to have conducted the equivalent of a cost-benefit analysis without looking at the benefit side.

“This report is a disappointment from a climate change perspective. We would encourage the Australian government to work with the coal industry on deploying technologies to reduce emissions from coal, while allowing Australia to continue to enjoy the economic benefits [coal] brings.”

According to the report, Australia’s coal reserves have the potential to release about 51 billion tonnes of carbon emissions, which the WCA hotly disputes.

The association said the loss of the coal industry would reduce Australia’s GDP by between A$29 billion and A$36 billion per year. (US$1=A$1.05).

Mr Catelin said: “In Asia, where most Australian coal exports are destined, coal plays a strong role in social and economic development. In China, coal has been the major energy source fuelling the industrial development that has raised over 660 million people out of poverty over the past three decades.

“It is wrong that the Australian Climate Commission should think to dictate that other developing countries should not access the fuel that has driven down poverty in China and driven the prosperity of the Western world.

“The report also does nothing to address climate change in a realistic or sustainable manner. It does nothing to support improvements in energy efficiency at power stations or the deployment of carbon capture and storage – something the Intergovernmental Panel on Climate Change (IPCC) and the IEA have stated are necessary to tackling global warming successfully.”


SINGAPORE: Oil spilled in yet another collision between ships

(EnergyAsia, July 4 2013, Thursday) — About 100 metric tonnes of bunker fuel spilled into Singapore waters following a collision on Tuesday morning between two vessels about 6.6km southwest off the Tanah Merah ferry terminal.

No one was injured in the collision between a South Korean-registered bulk carrier, Oriental Pioneer, and a Bahamas-registered bulk carrier, Atlantic Hero, said the Maritime and Port Authority of Singapore (MPA). A total of 11 patrol and anti-pollution craft have been deployed to clean up the spill as oil leaked from one of the Oriental Pioneer’s badly damaged bunker fuel tanks.

While no “significant” patches of oil were sighted in the affected waters, the MPA said oil stains were found yesterday along the rock bunds and sandy shoreline near the ferry terminal. The National Environment Agency is coordinating cleaning efforts along the affected areas.

The MPA said it is co-ordinating the clean up with other government agencies and the owners of the two vessels, now safely anchored in the Eastern Bunkering Anchorages. Traffic flow through the port and the Strait of Singapore has not been affected.

The MPA said that prior to the collision, its Port Operations Control Centre had provided information and issued warnings to the vessels when they were about 1.5 nautical miles (about 2.8km) apart. The ships were also in communication with each other.

Despite surveillance efforts and the use of high-tech equipment, shipping accidents continue to regularly occur in the waters in and around Singapore.

CHINA: Peabody Energy chief Boyce endorses emissions plan, sees increasing coal use

(EnergyAsia, July 4 2013, Thursday) — The chairman and CEO of one of the world’s largest coal mining firms has endorsed the vision of China’s new government to improve the country’s air quality by accelerating the use of emissions control technology while continuing to use coal to fuel the economy.

China’s State Council recently announced new measures to address urban air quality through rapid upgrades to pollution controls and more stringent enforcement actions, while continuing to use more coal for electricity generation, conversion to other fuels and chemicals, and steel production.  China is the world’s largest coal consumer and has led major economies with unprecedented economic growth in recent decades.

Gregory H. Boyce, head of US Peabody Energy, has praised the government of President Xi Jinping and Premier Le Keqiang “for taking steps to accelerate the use of emissions control technologies across the nation’s expanding industrial sector while increasing the coal use that has fuelled the nation’s stunning economic development.”

Following a keynote address at an industry conference in Canberra, Australia, he said:

“The approach announced by China’s leaders has proven successful in the US in the past, allowing substantial improvement in emissions from coal-fuelled generation in recent decades. It addresses air quality challenges – while increasing coal use to fuel economic growth – through greater investment in and use of technology that is widely available.”

According to Mr Boyce, the Xi administration’s measures are consistent with energy policy recommendations made by Peabody at the 2013 China Development Forum (CDF) Economic Summit in Beijing.

He said China should defend its right to develop the economy and society though the use of its abundant coal resources, follow the proven US model for solving urban air quality challenges by increasing the deployment of modern emissions control technology, and adopt the principles of 21st Century coal by implementing the highest standards for worker safety, resource recovery, land restoration and water use in its mining sector.

“Affordable, reliable electricity benefits both households and businesses and is the backbone of economic growth,” said Mr Boyce, who predicts global coal demand, led by China and India, to increase by around 1.4 billion metric tons over the next five years.

Peabody Energy, the world’s largest private-sector coal company and advocate of sustainable mining and clean coal solutions, serves metallurgical and thermal coal customers in more than 25 countries on six continents.

NIGERIA: Shell slammed for “exaggerating” claims that pipeline sabotage is main cause of oil spills

(EnergyAsia, July 3 2013, Wednesday) — Friends of the Earth International (FOEI) and Amnesty International said Royal Dutch Shell is making exaggerated claims that sabotage is the main cause of Nigeria’s persistent oil spills to avoid taking responsibility and having to pay compensation for the environmental disasters.

Citing National Contact Point (NCP) of the Netherlands which investigates claims of human rights and environmental abuses against companies, the two organisations said the European major’s statements were based on “disputed evidence and flawed investigations.”

In the mid 1990s, Shell accepted that it was responsible for much of the oil pollution in the Niger Delta. However, recently, it has begun to blame sabotage, oil theft and illegal refining by communities and criminals for most of the problem.

The organisations said NCP “should have gone further” in its criticism of Shell as they provided what they said is evidence of “serious flaws” used by the company for investigating oil spills, including video footage of “serious problems” in a spill investigation.

“Sabotage is a problem in Nigeria, but Shell exaggerates this issue to avoid criticism for its failure to prevent oil spills,” said Audrey Gaughran of Amnesty International.

“The oil companies are liable to pay compensation when spills are found to be their fault but not if the cause is attributed to sabotage – but it is effectively the company that investigates itself. This is clearly a system open to abuse and we have evidence that it has been abused.”

Over the last decade, Shell has claimed that most of the oil spilt in the Niger Delta is due to sabotage of its pipelines on the basis of a system that includes publicly contested data and relies almost exclusively on information provided by the company itself, said FOEI and Amnesty.

“The alleged sabotage cases have not been verified by any independent bodies. Moreover, some of Shell’s statements on the percentage of oil spilt due to sabotage are contradictory.”

The two organisations said that by making “misleading and incorrect” statements, Shell has breached the OECD Guidelines for Multinational Enterprises. The NCP, which was established to promote and implement the OECD Guidelines, found that Shell’s investigation process in Nigeria relies heavily on the expertise of the oil companies themselves.

FOEI and Amnesty said that, as the UN Environment Programme found in 2011, “government agencies are at the mercy of the oil companies when it comes to conducting site inspections.”

According to the two organisations, the NCP stated that the “Shell management should have had a more cautious attitude about the percentage of oil spills caused by sabotage” and that “after all Joint Investigation Team (JIT) data are not absolute”.

The NCP called on Shell to “be prudent with regard to general communication to stakeholders of very detailed figures on oil spills, when discrepancies exist with regard to the causes or amounts of those oil spills” and also to “share information on relevant spill causes and spill cause determination procedures, also dated before January 2011.”

The two organisations criticised the NCP for not commenting on whether Shell’s failures constituted a breach of the guidelines.

“It did not make a full assessment of the evidence provided and it failed to investigate whether Shell’s statements were indeed misleading. Amnesty International and Friends of the Earth International repeatedly expressed serious concern that this approach effectively left unaddressed all past harm done to the people of the Niger Delta as a result of Shell’s misleading statements,” they said.

“The NCP failed to speak out against Shell’s abuse in Nigeria. It did not assess key evidence provided and thereby let the company off the hook. For the people of the Niger Delta this is yet another failure of justice,” said Paul de Clerck of Friends of the Earth Europe.

“The NCP is not fit for purpose. It has proven unable or unwilling to tell Shell it should accept responsibility for its mistakes. It is time that the Dutch government introduces a corporate accountability supervisory body with strong teeth.”

The two organisations said that from the outset the NCP was unable to prevent Shell from obstructing the OECD process.

They concluded that as a result of NCP’s failure, the system cannot produce meaningful resolution of issues with Shell.

They said they have decided to withdraw a second complaint to the NCP about Shell’s longstanding role in oil pollution of Ogoniland in Nigeria.

“A process where the party that is the subject of the complaint can set the terms of engagement is setting itself up for failure,” said Mr de Clerck.

SINGAPORE: Vopak chairman thanks customers, partner and local employees in speech on 30th anniversary celebration

(EnergyAsia, July 2 2013, Tuesday) — The following is an edited version of a speech by Royal Vopak chairman and CEO, Eelco Hoekstra, on the occasion of its Singapore subsidiary’s 30th anniversary celebration last week.

“In 1980, what started as an idea to predict future opportunities towards the next decade, materialised into the founding of Vopak in Singapore. The brainchild of the forward thinking Carel van den Driest – previous Chairman of Van Ommeren – Sebarok terminal, commissioned in 1983, became Vopak’s first terminal in Asia and the first third-party oil storage facility in Singapore.

Singapore’s prime location at the crossroads of Asia, its free market economy, transparency, visionary master-planning and openness to foreign investments provided the ideal foundation for a synergistic relationship between Singapore and Vopak (then Van Ommeren).

This is evident in our growth story – from one terminal to four terminals with total capacity at over three million cubic meters spread across western Singapore, in what is now one of the world’s major energy hubs. Today, we continue to seek avenues for growth, with the latest addition being the 100,000 cbm industrial storage in Banyan, which was recently commissioned.

Thirty years on, Singapore and Vopak have created a ‘pearl’ of a partnership. One solidified by the ongoing support and commitment of our customers, the Singapore government, our partners, contractors and notably, our dedicated employees.

Singapore for many of my colleagues, their families and for me has been a special experience. Personally, when appointed CEO three years ago, I left heavy heartedly – as of the places we have lived as a family, Singapore felt most like home, and is in fact considered our second home.

For Vopak, Singapore will continue to be our strong regional base – amongst our other regional hubs in Rotterdam, Houston and Fujairah – and also the “launch pad” for our expansions in Asia. We are optimistic that Vopak Terminals Singapore (VTS) will continue to serve as a model and the nucleus for our future growth in the Asia region.

With Asia being the driving engine for global growth, energy demand will continue to rise. Singapore is well positioned to capitalise on the opportunities presented by this growth in energy demand.

Vopak remains confident of the energy and chemicals sector in Singapore.

Today’s celebration would not be possible without the people who have journeyed with us over the last 30 years.

First to our partner, PSA International, and its then Deputy General Goon Kok Loon who was instrumental in making VTS a reality We appreciate your enduring support over the last 30 years and very much look forward to continuing our partner collaboration with you.

To our customers, you are the reason we are here today. Your loyalty over the past decades has not gone unnoticed. Thank you for the past 30 years, we look forward to continuing on our journey of delivering excellent service in a safe manner with you.

AUSTRALIA: Caltex’s improved first-half net profit tarnished by A$50 million refining loss

(EnergyAsia, July 2 2013, Tuesday) — Australia’s largest downstream company Caltex said an A$50 million loss at its refining business partly took the shine off its first-half net profit of between A$180 and A$200 million. (US$1=A$1.05).

Investors sold the shares of the Australia-listed firm despite its improved profit level compared with A$167 million reported for the same period last year.

Caltex, which is half owned by US major Chevron, blamed the loss at its refining unit on the weaker Australian dollar against the US dollar, a fire at the Lytton plant in Brisbane and a damaged fuel pipeline linking it to Sydney.

SINGAPORE: DNV starts construction of laboratory to serve deepwater oil and gas sector

(EnergyAsia, July 1 2013, Monday) — Norwegian classification, inspection and survey firm DNV has started work building on its specialised S$15 million laboratory in Singapore to provide testing services for ships and companies involved in deepwater oil and gas activities. (US$1=S$1.28).

When completed by the first quarter of 2014, the new facility will provide a range of services including material or component qualification, large structure mock-up test, corrosion protections system and degradation mechanism analysis vital for oil and gas companies operating in the region.

DNV said the laboratory will be the only one in Asia to provide full-scale pipe fatigue assessment by resonance testing, a key technical qualification in more challenging pipeline environment.

Located at Gul Circle, the new facility will work very closely with the DNV Deepwater Technology Centre, which was established in 2012, to provide testing services related to subsea umbilical, flow line, riser, floating systems, drilling and wells. The company currently owns and operates laboratories in Norway, Singapore, Malaysia and the US.

“The new facility with its state-of-the-art services shall reinforce our presence in an important market and enable us to supply the growing needs of our customers in Singapore and other parts of Southeast Asia,” said Ernst Meyer, Vice President and Director of Operations for DNV South East Asia & Pacific.

“DNV has 40 years of experience in offshore and deepwater and with Asia Pacific becoming a booming deepwater oil and gas market, DNV in Singapore is well positioned to support Asia Pacific in undertaking more specific and in-depth testings for the energy and shipping sectors.”

INDIA: Sembcorp’s jointly-owned power plant secures second coal supply deal

(EnergyAsia, June 28 2013, Friday) — Singapore’s Sembcorp Industries said its joint venture firm, Thermal Powertech Corporation India (TPCIL), has secured a 20-year deal for coal supply to its 1,320MW power plant now under construction in Andhra Pradesh state.

Mahanadi Coal Fields, a subsidiary of state-owned Coal India, has agreed to provide an annual supply of 2.1 million tonnes of domestic coal from the second half of 2014 when the power plant comes onstream.

In February 2012, TPCIL secured its first coal supply contract with Indonesia’s PT Bayan Resources for one million tonnes per year for 10 years.

“Together, both contracts will supply approximately 60% of the plant’s total coal requirement. TPCIL is currently working with the relevant authorities in India to secure another fuel supply agreement for the plant by the later part of this year,” said Sembcorp, which owns 49% of TPCIL through subsidiary Sembcorp Utilities.

Gayatri Energy Ventures, a wholly owned subsidiary of India’s Gayatri Projects, owns the majority 51% of TPCIL, which is building the plant in Krishnapatnam in Andhra Pradesh’s SPSR Nellore District.

Sembcorp said the latest coal supply agreement will enable TPCIL to supply power to thousands of consumers in Andhra Pradesh and play an essential role in helping to reduce the severe shortage of power supply in the state and southern India.

The plant will also apply supercritical technology which allows for enhanced efficiency, thereby reducing emissions of carbon dioxide and other pollutants by consuming less fuel per unit of electricity generated compared to conventional sub-critical coal-fired generating units.

According to TPCIL, the project will be implemented in two phases, with the first unit of 660 megawatts to start up by mid-2014, and the second 660MW unit about six months later.


ANGOLA: CNPC unit pays US$1.52 billion for 10% stake in offshore oil field

(EnergyAsia, June 27 2013, Thursday) — China National Petroleum Corp (CNPC) said a fully owned subsidiary has agreed to pay US independent Marathon Oil Corp US$1.52 billion for its 10% stake in an offshore oil and gas field in Angola.

Subject to government, regulatory and third party approvals, Sonangal Sinopec International Ltd will acquire the Houston-based firm’s stake in Block 31 to add to its existing 5% stake which was acquired from France’s Total.

BP owns a 26.67% stake in Block 31 through operator BP Exploration Angola. Its partners include Angola state-owned Sonangol E.P. (25%), Sonangol P&P (20%), Statoil Angola AS (13.33%) and SSI Thirty-One Limited (5%).

The block, which is though to hold more than 530 million barrels of oil reserves, is CNPC’s third major purchase this year.

Last week, the state-owned company said it will acquire a 20% stake in the US$20-billion liquefied natural gas (LNG) project in the Yamal project in northwestern Siberia. Three months earlier, CNPC agreed to pay US$4.2 billion for a stake in a natural gas field off the coast of Mozambique.


RUSSIA: CNPC to acquire 20% stake in Novatek’s Yamal LNG project

(EnergyAsia, June 27 2013, Thursday) — China’s largest oil and gas producing company has agreed to acquire a 20% stake in Russia’s US$20-billion Yamal liquefied natural gas (LNG) project for an undisclosed sum.

China National Petroleum Corp (CNPC) will join France’s Total as equal minority owners with operator Novatek, Russia’s second-biggest natural gas producer, still holding a majority stake of 60%.

The partners plan to build an LNG plant with an annual production capacity of 16.5 million tons, drawing on feedstock from the South-Tambeyskoye field which holds total proven and probable reserves of 907 billion cubic metres of natural gas.

They also plan to build transport infrastructure including a sea-port and an airport located at Sabetta in the north-east of the Yamal Peninsula.

The deal, signed in the Russian city of St Petersburg last week, will enable Novatek, controlled by billionaires Leonid Mikhelson and Gennady Timchenko, to gain access into the Chinese natural gas market.

As part of the agreement due to close on October 1, CNPC will purchase at least three million tons of LNG per year from Yamal as well as provide “active assistance” in helping to secure financing for the project from Chinese financial institutions.

CNPC chairman Zhou Jiping said his company’s entry into the Yamal project will help guarantee long-term LNG supply to China. We welcome the increase in Russian LNG supplies to China.”

Novatek chairman Leonid V. Mikhelson said:

“This agreement is a very important step in the implementation of the Yamal LNG project. We see CNPC as a reliable partner with considerable experience in international LNG projects, as well as a long-term buyer of LNG representing one of the fastest growing gas markets in the world. We are also looking forward to CNPC’s significant contribution into attracting external financing for the project”.


INDONESIA: Germany’s HMS Bergbau AG sells port operations to become “pure-play” coal trader and marketer

(EnergyAsia, June 26 2013, Wednesday) — HMS Bergbau AG, a Germany-based international coal producing and trading company, said it has sold its port operations in Indonesia as part of a plan announced in 2011 to focus on becoming “a pure-play trading and marketing company.”

Without disclosing details, the Berlin-based company said the sale will result in “a low loss on disposals” for 2013.

The funds from the sale will be used for securing exclusive marketing agreements with coal producers for the Frankfurt-listed company to focus on developing its markets in Asia and Africa.

“The aim of such agreements is to establish long-term customer and supplier relationships. In addition to stable sales and earnings contributions, the agreements that are usually concluded for longer periods offer HMS Bergbau AG a competitive edge in terms of ensuring coal supplies and complying with delivery commitments in particular,” it said.


CHINA: ExxonMobil officially starts up Signum Oil Analysis Lab in Shanghai

(EnergyAsia, June 25 2013, Tuesday) — US major ExxonMobil has launched a new major laboratory in the Chinese city of Shanghai to provide analysis for lubricants and oil used in industrial machinery across the Asia Pacific region.

The company said its latest Signum laboratory, the fourth in the world, will offer the most modern oil analysis techniques and help customers in China and across Asia achieve preventive maintenance and ensure safety, environmental protection and efficiency in the production process.

Darren Talley, ExxonMobil’s Global Vice President of Marketing, and other senior executives along with customers and local Chinese officials attended the opening of the facility at its Shanghai Technology Center (STC) on June 19.

As the “lifeblood” of industrial machinery, ExxonMobil said lubricants protect critical components and help promote enhanced operation, just as blood supports health in the human body.

ExxonMobil will offer its Signum oil analysis programme, already in use at hundreds of companies around the world, to help others in Asia improve their industrial equipment performance and reduce costs.

As an example, ExxonMobil said the Tibet Dongga Power Plant, the main electricity supplier for Tibet, has benefitted from the programme through periodic monitoring of engines and lubrication status. The plant’s Sulzer 16ZAV40S Engine Dynamotors which operate under severe working conditions have been an important focus since it signed up for the programme in 2008.

Based on the Signum analysis reports, a Mobil field engineer submitted a flushing proposal to clean the company’s lubrication system, and suggested re-engineering oil purifier program when detected the filter and lubricants status were subdued.

“As a result, the Tibet Dongga Power Plant was able to save US$50,000 over the span of three years. These savings come from reduced filter consumption as well as reduced labor and lubrication oil analysis costs,” said ExxonMobil.

Oil analysis is based on a slate of tests designed to help evaluate the condition of internal hardware as well as the in-service lubricant. It is a quick and non-invasive way to gauge the health of a machine by looking at the oil’s contents.

At the Signum laboratory, specialists analyse a range of factors including the lubricant’s properties, suspended contaminants, and wear debris. Regular testing allows personnel to monitor contamination levels and guarantee the optimum lifespan of machines and other critical plant equipment.

Oil analysis also supports environmental awareness by ensuring the cleanliness and efficiency of hydraulic oil systems, combustion engines, and other industrial machinery.

In an interview with EnergyAsia, Bennett Hansen, ExxonMobil’s Asia Pacific Marketing Manager (Marketing & Technology), said the Signum laboratory now counts companies from the wind energy, mining, steel-making, power, cement, paper and petrochemical industries among its main customers.

“The new Signum Laboratory extends ExxonMobil global technology footprint in China and the Asia Pacific and enables us to better support our customers in the region,” he said.

“With our lubricant business growing steadily in China and the Asia Pacific, more customers are requesting superior oil analysis to improve machine efficiency and reduce downtime. The new laboratory will help meet our customers’ requests quickly through technical application expertise.”

Mr Hansen, who declined to reveal the investment cost for the new facility, said ExxonMobil is in the process of relocating its lubes technical help desk to the Shanghai Technology Center to better serve customers. It is also planning additional testing capabilities at the centre to enhance lube application expertise and to support collaborative programmes with OEMs and local universities.