International Power Chile Plants Inaugurated

29 November 2011

Inauguration of two 150MW power plants in Chile

29 November 2011 ‐ GDF SUEZ and International Power (70% owned by GDF SUEZ) are pleased to announce that the 150MW Andina Thermal Power Plant (CTA) and the 150MW Hornitos Thermal Power Plant (CTH), located in the north of Chile, were officially inaugurated today.
Together the two thermal power plants will supply 300MW to Chile's Norte Grande Interconnected Power System (SING), which mainly supplies power to the Esperanza and Gaby mines located in the north of the country. Chile is an attractive market with demand for power forecast to grow at an annual rate of around 6%. CTA and CTH represent a total investment of around US$900 million, including the cost of building a new 144km transmission line and substation.
The CTA and CTH plants feature state of the art technology, known as "circulating fluidized bed", which allows them to use a range of solid fuels, including up to 10% biomass. This technology helps both to improve the efficiency of the combustion process and reduces emissions.
The two power plants are operated by E-CL, a Chilean power generation company, which is 52.77% owned by International Power. E-CL owns 100% of CTA and 60% of CTH.
Gérard Mestrallet, Chairman and CEO of GDF SUEZ, said: "Our Group is constantly investing in the research and development of new, highly efficient and innovative technologies. Combined with our broad geographic reach and a diversified energy portfolio, this allows us to offer a variety of solutions depending on the conditions of the country where we operate. Chile is an important country for GDF SUEZ in Latin America and this new development shows the Group's commitment to this growing region."
Philip Cox, CEO of International Power, commented: "CTA and CTH are modern, efficient facilities that will help to meet Chile's fast growing demand for power. Both projects are supported by long-term offtake contracts."
Activities in Chile
In Chile, in addition to CTA and CTH, IPR–GDF SUEZ Latin America also has a 63% stake in the LNG receiving and regasification terminal GNL Mejillones and Monte Redondo, a 48MW wind farm which is part of the country's central grid. It is also constructing the 34MW hydroelectric plant Laja I.
About International Power
International Power plc is a leading independent electricity generating company operating across 30 countries with 72,360MW (gross) (42,225MW net) in operation and a significant programme of 15,503MW (gross) (6,561MW net) projects under construction as at 30 June 2011. International Power is listed on the London Stock Exchange with ticker symbol IPR. GDF SUEZ holds a 70% interest in International Power plc.
About GDF SUEZ
GDF SUEZ develops its businesses around a model based on responsible growth to take up today's major energy and environmental challenges: meeting energy needs, ensuring the security of supply, fighting against climate change and maximizing the use of resources. The Group provides highly efficient and innovative solutions to individuals, cities and businesses by relying on diversified gassupply sources, flexible and low‐emission power generation as well as unique expertise in four key sectors: liquefied natural gas, energy efficiency services, independent power production and environmental services. GDF SUEZ employs 218,350 people worldwide and achieved revenues of €84.5 billion in 2010. The Group is listed on the Brussels, Luxembourg and Paris stock exchanges and is represented in the main international indices: CAC 40, BEL 20, DJ Stoxx 50, DJ Euro Stoxx 50, Euronext 100, FTSE Eurotop 100, MSCI Europe, ASPI Eurozone and ECPI Ethical Index EMU.

A look at the impact that LNG and unconventional gas could affect the future of the EU gas market.

Nicholas Newman 24 November 2012

In recent years, Europe has experienced a gas glut caused by the US becoming self-sufficient in gas (mainly due to unconventional gas production), which has also caused traditional US suppliers to divert exports to the European Market. However, there have been acts of god, banana skins and black swan events that have affected in recent times the EU gas market. These have included Japan’s massive emergency imports of gas and the Libyan war that halted gas exports to Europe, although Libyan gas exports are beginning to recover.

We are in the midst of on-going changes in the European gas market framework, in part due to European Commission intervention, but also due to the development of alternative gas import sources both domestic and foreign. We have seen the rise in the use of hub pricing, as there has been a decline in the dominance of oil indexed long-term gas contracts and a greater range of contracts made available. The trouble is the market is asking will the new trading environment depress prices or maintain Gazprom’s ability to influence the market. It is also being asked is too much world gas production capacity coming on stream too soon.

As for shale, America is not the only source for shale gas E&P so is UK, Poland, China, India, Australia and Argentina. Nevertheless, for the EU shale E&P is at a much earlier stage of development than in the US. There are fears that US shale gas could flood the EU gas market, thus delaying development of EU domestic production for years. In addition, there are fears that Europe is still not ready to fully exploit shale gas production on a large scale.

Factors affecting the EU gas market include developments in Asian pipeline gas and LNG demand. The black swan in the market could be China, Beijing could insist that the Central Asian gas resources it has been developing should be paid for at below market prices or even in kind. Or even that it will replace gas imports with its own massive reserves of unexploited unconventional gas, which it could switch too, instead of importing from Central Asia, Gulf States, South East Asia and Australia.

In addition, the timing and slippage of North American shale gas projects. Also the future pricing and production policies of gas producers together with market developments, including how soon will Europe’s economy recover and the impact of rival fuel sources on gas demand. However, forecasting about the future depends on how many acts of god, banana skins and black swans will occur to affect the European gas market.

Loosely based on notes of a seminar  given by Howard V. Rogers Senior Research Fellow OIES on

16 November 2011

http://www.oxfordprospect.co.uk/

Discovery of good quality oil in south Santos Basin

November 23, 2011

Discovery of good quality oil in south Santos Basin Petrobras has confirmed the presence of good quality oil in well 4-SPS-91 (4-BRSA-1002-SPS),  in south Santos Basin, in an area known as Tiro and Sidon. The new well, informally known as Patola, is located at a water depth of 299 meters, some 200 km off the coast of São Paulo State and 3.8 km from discovery well 1-SPS-57 (1-BRSA-658-SPS), in the Evaluation Plan area containing wells 1-SPS-56 and 1-SPS-57 (1-BRSA-607 / 1-BRSA-658), former block BM-S-40. Preliminary analyses indicate that this oil is of the same quality as the oil found in   wild cat wells, around 36o API. The discovery confirms the potential for good quality oil in the shallow waters of south Santos Basin. The discovery was confirmed by cable test oil samples taken from the post-salt sandstone. The reservoir is approximately 2,160 meters deep. Petrobras will now go ahead with the activities and investments set forth in the   Evaluation Plan, including drilling other wells in the area, and will proceed with an Extended Well Test (EWT). EWTs are currently in progress on wells 1-SPS-56  and 1-SPS-57.

Click here to see the map

Dragons’ Deborah and Theo commit to solar industry

Tomorrow afternoon there is going to be a big solar rally and lobbying of Parliament by the solar industry to demonstrate the sector's anger over the government's proposal to cut the all important Feed-in-Tariff by 50%. On 31 October the coalition announced that they plan to bring in this drastic cut which could damage the solar industry and discourage British homeowners from investing in solar panels on their home.

Deborah Meaden and Theo Paphitis from the Dragons’ Den have just signed the deal today to invest in a solar company. I know this in itself isn't necessarily worthy of an interview, but given the fact that the Dragons have decided to invest in the solar industry despite the current troubles shows that they believe there is a strong future for the solar sector. Chris Hopkins, the founder and MD of Ploughcroft Solar who appeared on the Dragons' Den is available for interviews tomorrow if you would be interested in getting a local solar firm's point of view on what is happening in London.

Chris Hopkins, the founder and MD of Ploughcroft Solar who appeared on the Dragons' Den is available for interviews tomorrow if you would be interested in getting a solar firm's point of view on what is happening in London. And we can also offer Deborah Meaden to give her views as to why solar remains a strong investment opportunity for the British consumer.

Dragons’ Deborah and Theo commit to solar industry

Dragons’ Den investors Deborah Meaden and Theo Paphitis have today shown their commitment to the distressed British solar sector by signing a deal with Yorkshire-based Ploughcroft Solar, one of the UK’s leading solar PV panel installers.

With a solar rally and lobby of Parliament planned for tomorrow afternoon (Tuesday 22 November), the solar industry and green organisations are up in arms over the government’s plans to halve the all important Feed-in-Tariff (FIT) which has encouraged tens of thousands of British homeowners to turn to solar.

Demonstrating that they believe there is still a bright future for solar in this country, Deborah and Theo have invested in Ploughcroft Solar as a result of MD Chris Hopkins’ pitch on the Dragons’ Den programme this summer.

Said Deborah: “In our lifetime, a switch towards renewable energy is not an option – it has to happen. Consumers need help to make the right choices as there are many conflicting messages being issued to the public. A review of the FIT is the right thing to do, although the scope, timing and conflicting messages have not been helpful.

“Although the government’s proposals to reduce the FIT from 43p/KWh to 21p/KWh are drastic, we believe that even if this new tariff is introduced solar is still an attractive option to homeowners. As energy bills continue to rise consumers will be looking for ways of lowering their energy costs and going green. With the 21p/KWh FIT solar photovoltaic (PV) panel homeowners will get a sensible return on their investment, as well as seeing lower electricity bills and helping the environment.

“Theo and I are both 100% committed to the growth and stability of Ploughcroft, which is leading by example within the solar industry. The government’s proposals haven’t scared us off and should not discourage the British public from investing in solar and other renewable energies. Our job is to make sure people still understand there is a good reason to commit to renewable energy, both financially and ethically. Once the government’s final decision on the new FIT has been made the solid, forward thinking renewable industry can continue to grow.”

Chris Hopkins, who has been at the forefront of the solar industry for six years and is also a member of the newly formed Green Construction Board for the Department of Business, Innovation & Skills added: “Since the government made its FIT reduction announcement on 31 October we have seen a 50% increase in enquiries compared with the previous month. We have already secured sales on systems that we will be installing in January and February 2012 on the new tariff. This indicates that homeowners remain keen to reduce their electricity bills whilst doing their bit to help the environment.”

The expertise of Deborah Meaden and Theo Paphitis will help Ploughcroft Solar expand into new areas of renewable energy throughout 2012, and support the company’s mission to become the name for renewable energy for homeowners across Britain.

Members of the public and businesses can email fits@decc.gsi.gov.uk or telephone 0300 068 5733 to register their comment on the proposed policies.

For further information visit www.ploughcroft.co.uk

The World is Desperate for Energy Engineers

By Nicholas Newman 18 November 2011

It’s not a scarcity of oil the world should be worried about but more importantly a desperate skills shortage of engineers. This is especially so for the global energy industry. For many jobs, the number of vacancies exceeds the number of skilled experienced engineers that are available. Already, such shortages are causing significant delays and costs for major projects including development of offshore oil fields off Angola.  Whilst in Brazil, the home of samba, tropical rainforests and traffic jams, this developed county is in a desperate search for engineers to construct 12 super tanker sized FPSO’s over the next decade. Such skills deficiencies are harming energy security, harming economic recovery and the ability of the world to meet its ambitious CO2 targets.

The only solution the energy industry has is to pay higher salaries and offer better conditions. Already, in Australia many engineers with energy related expertise are starting on salaries of AUS$20,000 a month. Even in the remotest desert locations of Australia or Iraq, the camps offer the best in accommodation and food. Ironically, subsea engineers are the amongst those in greatest demand. As to why there is a shortage of energy engineers, in part, it is due to lack of sufficient support governments, universities and industry to ensure adequate levels of people are trained every year. It is also due demographics, as the workforce ages and to the cyclical nature of the industry. Today, it is not helped that the sheer number of new projects worldwide that are being developed and coming on stream. In Australia, for instance the boom in mining of coal, iron ore and uranium is taking place at the same time there is also a boom in oil, gas, solar, power and unconventional gas projects. Because of poaching between the different energy sectors, pay and conditions have had to be drastically improved, in a desperate attempt to overcome such work force shortages.

Due to it being a sellers’ market for engineers, energy companies are having to becoming more sophisticated in recruitment practices. Increasingly they are relying on experts talent scouts to find, identify and select as well as maintain the loyalty of the engineers in this very competitive global market.  In addition, many such recruitment agencies such as Hays, NES Global are working on behalf of their clients Total, Shell, ENI to co-ordinate the development of the skilled candidates in their studies at universities around the world. In many new energy producers, governments are encouraging local content polices to ensure that the energy industry makes sufficient investment in overcoming the global energy sectors current labour shortages.
http://www.oxfordprospect.co.uk/Energy-Features.html

World Energy Market Prospects 2012

Nicholas Newman 24 Oct 2011

A quick look at various aspects that make up the global power generation sector, including wind, solar, nuclear, hydro and coal power station prospects.

Despite the popularity of renewable technology, development of conventional power plants continues to grow a pace.

This year is likely to see the end of the feather bedding of renewables in many countries, due to budgetary constraints in numerous countries. Given these new market conditions both investors and operators are being faced with harder often politically unpopular choices to make in their investment strategies. This article gives an overview of the picture facing investors in various parts of the world.

Tough times ahead for renewables?

Renewables have been doing well in recent years. However, due to budgetary constraints in many countries, governments are cutting back on subsidies for the renewables' sector. Which means there are tough times ahead for wind, solar, geothermal and wave power schemes.

From my experience, renewables need to make greater strides before they no longer have to depend on government subsidises and other policies to distort the market in its favour. At present, more money is to be made in the companies servicing renewable installations than investing in them, so have a look at consultancies.

Why hydro has a future?

I think the hydro sector has great possibilities, which in Europe will mean upgrading generating capacity at hydro station dams along major rivers, such as the Danube. Similar potential exists in the United States to upgrade existing facilities in an environmentally friendly manner. However, the main obstacle is the anti-hydro ideology among some environmentalists in North America. In addition, new hydro power schemes both large and small are likely to be constructed in Russia, South-East Asia and South America in the next few years.

Wind prospects look good in the Arctic!

As for wind, I think the proposed North African Desertec scheme has its financial, market and political problems. I think a better bet for investors will be the so-called Arctec scheme proposed for the Northern Scandinavian coast, because of its more favourable business climate and ease of access to Northern European markets such as the Germany.

Why pulling the plug on nuclear means more coal and gas power stations?

However, just because Germany and Italy have said no to a new phase of nuclear does not mean, this is the end for atomic power in Europe, there are too many national, strategic, environmental and economic reasons for building new atomic plants.

In fact, both countries will continue to enjoy the benefits of nuclear power. They will be importing it from neighbouring countries, such as France, which have nuclear-power programs. In fact, many of the investors in such plants will include German and Italian power generating companies as partners.

Already, both the United Kingdom and France have announced a new phase of nuclear power station building. In addition, the pulling of the plug on atomic in those countries has seen power companies reactivate coal power stations, and Europe’s orders for coal have increased as a result. This will mean europe will find it harder to meet its carbon emmission targets.

However, various power generation companies have annouced plans for speeding up proposals to extend the life of existing plants and schemes for new gas and coal power plants. As the new gas plants come on stream, it has been estimated that by 2014, Europe will be seeking additional gas imports. One potential source is the Nordstream gas pipeline project linking Siberian gas fields with Germany via the Baltic Sea. It should be operational by 2012, just in time to give a boost to EU gas supplies as Europe's economy begins to recover.

A possible golden future for Australian renewables.

For investors in the energy sector, current trends are suggesting Australia is a great investment given its proximity to North Asian markets for its coal and gas exports. However, there has also been a recent change of fortune for the county’s renewables sector, due to the latest announcements made by Australia’s Prime Minister Julia Eileen Gillard to rig in favour of renewable power generators the country’s power market. See also Australian PM faces stiff opposition against her radical carbon polices!

As an energy expert, I expect to find the next few years very interesting!