NewBase 20-January-2023 Energy News issue - 1585 by Khaled Al Awadi_compressed.pdf

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NewBase Energy News 20 January 2023 No. 1585 Senior Editor Eng. Khaed Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
U.A.E: ADNOC announces world’s first fully sequestered CO2
injection project in carbonate rock
WAM - Esraa Esmail/ Rola AlGhoul
ADNOC, a reliable and responsible provider of lower-carbon intensity energy, announced today at
Abu Dhabi Sustainability Week (ADSW) that it has begun work on the world's first fully sequestered
carbon dioxide (CO2) injection well in a carbonate saline aquifer.
The project, which is expected to begin injecting CO2 in Q2 2023, marks another important step in
ADNOC's commitment to decarbonise its operations, reduce its carbon intensity by 25% by 2030
and deliver on its Net Zero by 2050 ambition.
ADNOC, a reliable and responsible provider of lower-carbon intensity energy, announced today at
Abu Dhabi Sustainability Week (ADSW) that it has begun work on the world's first fully sequestered
carbon dioxide (CO2) injection well in a carbonate saline aquifer.
The project, which is expected to begin injecting CO2 in Q2 2023, marks another important step in
ADNOC's commitment to decarbonise its operations, reduce its carbon intensity by 25% by 2030
and deliver on its Net Zero by 2050 ambition.
Yaser Saeed Almazrouei, ADNOC Upstream Executive Director, said, "Carbon capture and storage
will play an important role in reducing emissions and achieving global climate goals, and ADNOC is
ww.linkedin.com/in/khaled-al-awadi-80201019/

building on its leadership position in this area as we continue to drive decarbonisation across our
operations.
At Al Reyadah, ADNOC deployed the region's first carbon capture project at scale, and we are
taking another tangible step to deliver on our $15 billion decarbonisation action plan with the world's
first fully sequestered CO2 injection well.
"We will continue working to make
today's energy cleaner while
investing in tomorrow's clean
energies and technologies to future-
proof our business. In doing so, we
will enable a lower-carbon future and
remain a reliable and responsible
energy provider to customers and
markets worldwide."
This innovative project will support
ADNOC's carbon capture and
storage program, which is part of the
suite of new projects and initiatives
the company is advancing following
the guidance by ADNOC's Board of
Directors to accelerate the delivery of
its low-carbon growth strategy and
the allocation of $15 billion (AED55
billion) to decarbonise its operations.
Once operational, the project will
initially fully sequester a minimum of
18,000 tons per annum of CO2 captured from Fertiglobe's UAE operations for injection in Abu
Dhabi's onshore carbonate aquifers, supporting ADNOC's ongoing efforts to safely capture and
store CO2 from its operations.
The CO2 injection well project builds on ADNOC's experience with its carbon capture facility at Al
Reyadah, which has the capacity to capture up to 800,000 tons of CO2 per year. The well location
for CO2 injection and targeted geological formations were identified using the results of ADNOC's
extensive 3D seismic survey and the company's state-of-the-art subsurface modelling capacity.
The project will contribute to the production of lower-carbon ammonia, an effective and cost-
competitive hydrogen carrier that can be scaled up quickly and has lower-carbon intensity than other
fuels. The project will also be monitored and assessed, using advanced technology at ADNOC's
Thamama Digital Centre of Excellence, to ensure the highest levels of environmental safety as the
company expands its carbon capture activities to capture 5 million tonnes per annum by 2030.
The project is the latest in a series of decarbonisation initiatives, including a landmark agreement
for ADNOC to acquire 100% of its grid power from the Emirates Water and Electricity Company's
(EWEC) nuclear and solar sources, making the company the first major oil and gas company to
decarbonise its power at scale though an agreement of this kind.
Additionally, ADNOC recently reached financial close on a $3.8 billion deal to build a MENA first-of-
its-kind sub-sea transmission network, connecting ADNOC's offshore operations to TAQA's clean
onshore power network, which, once complete, could reduce offshore carbon intensity by up to
50%.

UAE: ADNOC partners with 44.01 to turn CO2 into rock
Source: ADNOC
ADNOC, a reliable and responsible provider of lower-carbon intensity energy, has announced a
partnership with the Fujairah Natural Resources Corporation (FNRC), Abu Dhabi Future Energy
Company (Masdar) and 44.01 to pilot technology that permanently mineralizes carbon dioxide
(CO2) within rock formations found in the Emirate of Fujairah. The announcement was made at the
Abu Dhabi Sustainability Week (ADSW).
The project, due to commence in January 2023, will use 44.01’s Earthshot prize-winning Carbon
Capture and Mineralization (CCM) technology to eliminate CO2 from the atmosphere. It will be the
first CCM project by an energy company in the Middle East.
Sophie Hildebrand, Chief Technology Officer at ADNOC, said: 'Across ADNOC we are committed
to finding new ways to decarbonize our operations, while meeting our responsibility to supply vital
energy to the world.
As the first energy company in the region to run a carbon-negative project of this kind, this pilot
marks the latest step in our $15 billion investment into projects that will reduce our carbon footprint
and help us achieve our Net Zero by 2050 ambition.'
Fujairah has been selected for this pilot due to its abundance of peridotite, a form of rock that
naturally reacts with CO2 to mineralize it.
Eng. Muhammad Saif Al Afkham, Chairman of the Board of Directors for Fujairah Natural Resources
Corporation, said: 'We are proud to support ADNOC and our other partners to catalyze this natural

process with 44.01’s technology. Success here could pave the way to help us make a significant
contribution towards the UAE Net Zero by 2050 Strategic Initiative.'
In this pilot, CO2 will be captured from the air, dissolved in seawater, and then injected into peridotite
formations deep underground, where it will mineralize – ensuring that it cannot escape back into the
atmosphere.
Talal Hasan, Founder and CEO of 44.01, said: 'Removing CO2 from the atmosphere is vital if we
are to halt and ultimately reverse climate change. Unlike CO2 storage, mineralization removes CO2
permanently by turning it into rock, minimizing the need for long-term monitoring and insurance.
This pilot will enable us to test our technology at scale, on our way to offering a safe, cost-effective,
natural solution for eliminating captured CO2 internationally.'
The project will be powered by solar energy supplied by Masdar. A successful pilot would open the
possibility of mineralizing billions of tons of captured CO2 across the region.
 Project will use 44.01’s Earthshot prize-winning
Carbon Capture and Mineralization (CCM)
technology to eliminate CO2 from the
atmosphere
 Fujairah pilot will be the region’s first CCM
project by an energy company
 Pilot partners include FNRC and Masdar

U.A.E: Masdar, DEWA sign partnership agreement to support
UAE sustainability objectives. Zawya + NewBase
Abu Dhabi Sustainability Week (ADSW) and Dubai Electricity and Water Authority (DEWA)
announced today the signing of a three-year partnership agreement to sponsor annual Water,
Energy, Technology, and Environment Exhibition (WETEX) and Dubai Solar Show.
The agreement was signed at
ADSW 2023 by Saeed
Mohammed Al Tayer, Managing
Director and Chief Executive
Officer of DEWA, and Mohamed
Jameel Al Ramahi, Chief
Executive Officer of Masdar.
As per the agreement, DEWA
will be the ADSW opening
ceremony associate partner
from 2023 to 2025, while Masdar
will be the WETEX jubilee
sponsor for the same period.
Al Tayer said, “DEWA and
Masdar have a strategic
partnership that supports the vision of
the wise leadership for a sustainable future in the UAE. We are pleased to sign this partnership
agreement, which supports our common vision to enhance the pioneering position of the UAE in
investing in renewable and clean energy.
We collaborate to develop innovative solutions and projects that contribute to building a sustainable
future for us and for generations to come. ADSW and WETEX are leading events that support the
government strategies in the UAE, including the UAE Net Zero by 2050 strategic initiative and the
Dubai Net Zero Carbon Emissions Strategy 2050 to provide 100 percent of Dubai’s total power
capacity from clean energy sources by 2050.”
Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar, commented, “We are pleased to
enter into this partnership that will help advance our shared goals for global collaboration for
sustainability.
Masdar has long recognised the value of WETEX, which stands alongside Abu Dhabi Sustainability
Week as a major event on the global sustainability calendar and demonstrates the commitment of
the UAE leadership to accelerating the energy transition.
Through platforms such as WETEX and ADSW, the UAE is driving the global sustainability agenda
and taking a leading role in climate action. We look forward to continuing to enjoy a productive
partnership with DEWA on future events.”
The partnership agreement will ensure greater alignment between the two key UAE platforms, in
line with the UAE’s long-term sustainability vision and net-zero objectives, and ahead of the 2023
United Nations Climate Change Conference (COP28), taking place in the UAE from 30th November
to 12th December.

KSA investing $200bn in renewables: Prince Faisal
TradeArabia News Service + NewBase
Saudi Arabia, a leading global supplier of oil, is investing almost $200 billion in renewable energy
at home and abroad, Saudi Arabia’s Foreign Minister told the World Economic Forum’s 2023 Annual
Meeting in Davos on Tuesday.
“Our companies are active in 21
countries, deploying solar and wind
energy and other sorts of renewable
energy,” Prince Faisal bin Farhan Al Saud
said.
During a high-level panel titled ‘Keeping
the Lights amid Geopolitical
Fracture’, Prince Faisal emphasised the
need for near-term stability, especially in
the world’s energy markets.
Geopolitical stability is "absolutely key" to
global energy security, he said.
“In the meantime, we need to maintain a supply of traditional energies that are priced in a way that
ensures stability – and we will continue to address this in a responsible way,” Prince Faisal added.
Meanwhile, Bandar bin Ibrahim Alkhorayef, Saudi Arabia’s Minister of Industry and Mineral
Resources, participated in ‘The Return of Manufacturing’, where he highlighted the need for
governments to foster innovation and co-investments in the industrial sector.
“You need the right regulatory framework to allow investment flow,” he said. Alkhorayef also
emphasised the need for the right infrastructure to enable factories of the future, as well as the
importance of governments to proactively develop skilled human capital to drive sustainable
growth.

Germany: bp reveals plans to evaluate expansion of Germany’s
green energy port with a new hydrogen hub Source: bp
bp will evaluate the feasibility of building a new hydrogen hub in Germany. The project, which would
be located in Wilhelmshaven, is expected to include an industry leading ammonia cracker which
could provide up to 130,000 tons of low-carbon hydrogen from green ammonia, per year, from 2028.
Green ammonia – produced by combining nitrogen with hydrogen derived from the electrolysis of
water using renewable energy sources – is expected to be shipped from bp green hydrogen projects
around the world to Wilhelmshaven.
The cracker converts the green ammonia into green hydrogen by splitting the larger molecule into
its smaller nitrogen and hydrogen components which can then be used directly. It’s anticipated that
up to 130,000 tons of hydrogen per year could be produced from the site, with scope for further
expansion as the market for future fuels develops.
Patrick Wendeler, chief executive of bp Europa SE, said: 'At bp we have the expertise and capacity
to cover the entire value chain of green hydrogen production, including conversion into derivates
like ammonia, transport, and then reconversion to supply green hydrogen to the customers and
places who need it.
This development would help create greater energy independence for our German customers
across a range of low carbon energy products. Wilhelmshaven has a proud energy history, and we
hope this hydrogen hub can help carve out its next chapter and help Germany meet its energy
transition goals.'
 bp plans to evaluate the construction of an industrial-scale ammonia cracker
and utilise repurposed oil/gas facilities to transport hydrogen
 New terminal would enable ammonia imports to Germany from around the
world
 Pipeline connections to heavy industrial customers in the Ruhr and
elsewhere

bp’s plans include utilising the existing infrastructure of the Nord-West Oelleitung (NWO) terminal
at Wilhelmshaven, where it is a participating shareholder. With its deep-water harbour and pipeline
system, Wilhelmshaven is one of the country’s most important energy terminals and is well
positioned to support energy transition activities.
Additionally, bp’s plans propose to utilise the current oil & gas pipelines for use in hydrogen
transport. The low-carbon hydrogen could then be delivered to customers in the Ruhr region and
other centres of demand.
Felipe Arbelaez, senior vice president hydrogen and CCS at bp, said: 'The development of this
import facility complements bp’s global hydrogen project portfolio, as we develop a presence in a
number of potential hydrogen and ammonia export locations in the Middle East, Africa and Australia,
which could supply part of the European demand in the coming years.
This is another critical step in developing and delivering low carbon hydrogen in communities
throughout the world.'
Christian Meyer, Minister for the Environment, Lower Saxony, added: 'In order to remain competitive
and resilient as an industrial location in the long term, we must ensure an affordable, climate-neutral
and secure energy supply.
To do this, it is important that we diversify our supply sources and create fewer dependencies. bp's
proposed new hydrogen centre in Wilhelmshaven can play an important role in this. At the same
time, it further advances the energy transition in Germany and strengthens Wilhelmshaven as an
important hub for the import of renewable, green energy.
We urgently need the new ‘Lower Saxony speed’ on the path to climate neutrality because we have
no more time to lose in protecting the climate'.
The proposed project is the latest in a string of hydrogen proposals in the country from bp. It follows
the H2 Nukleus and Lingen Green Hydrogen concepts. Together, they are anticipated to help
Germany reduce CO2 emissions in energy-intensive areas such as chemicals and steel production.

China’s Population Shrinks for First Time Since 1960s t
Bloomberg News
China’s population started shrinking in 2022 for the first time in six decades, the latest milestone in
a worsening demographic crisis for the world’s second-largest economy.
The country had 1.41 billion people at the end of last year, 850,000 fewer than the end of 2021,
according to data released by the National Statistics Bureau on Tuesday. T
hat marks the first drop since 1961, the final year of the Great Famine under former leader Mao
Zedong, and coincided with figures showing China’s economy expanded last year at the second-
slowest pace since the 1970s.
Some 9.56 million babies were born in 2022, down from 10.62 million a year earlier, the lowest level
since at least 1950, despite efforts by the government to encourage families to have more children.
A total of 10.41 million people died, a slight increase from around 10 million recorded in recent
years. China suffered a surge in Covid-related deaths starting last month after abruptly dropping its
zero-tolerance approach to the virus in early December.
More Covid-related deaths will likely come this year as fatalities usually lag infections by weeks and
infections are still spreading across the country. That outbreak could further push up the number of
deaths this year.
The decline in newborns was the main cause of the population contraction, according to Kang Yi,
head of the National Statistics Bureau.
“That’s mainly a result of drop in people’s willingness to have babies, the delay in marriage and
pregnancy, as well as a fall in number of women of child-bearing age,” Kang told reporters after a
press briefing Tuesday.

Kang said the drop — while the beginning of a new trend — was “not something to be over-
concerned about.” The supply of the country’s labor force is still greater than the demand, he added.
“The population will likely trend down from here in coming years,” said Zhang Zhiwei, president and
chief economist at Pinpoint Asset Management Ltd. “This is very important, with implications for
potential growth and domestic demand.”
The population drop-off came much faster than previously expected, and could act as a brake on
economic growth by slowing demand for goods such as new houses. Due to the decline, the
Chinese economy may struggle to overtake the US in size and the nation could lose its status as
the world’s most populous country to India this year.
As recently as 2019, the United Nations was forecasting that China’s population would peak in 2031
and then decline, but last year the UN had revised that estimate to see a peak at the start of 2022.
The labor force is already shrinking, long-term demand for houses will fall likely further, and the
government may also struggle to pay for its underfunded national pension system.
The country is following in the footsteps of other nations in East Asia such as Japan or South Korea,
which have seen their birth rates plummet and populations age and start to shrink as they’ve
become wealthier and developed.
China’s birth rate, or the number of newborns per 1,000 people, declined to 6.77 last year, the
lowest level since at least 1978. The data released by the National Statistics Bureau show 62% of
the population were of working-age, which China defines as people aged 16 to 59, down from
around 70% a decade ago, highlighting the challenges the country faces as its population ages.

NewBase January 20 -2023 Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oil prices climb on hopes for Fed slowing interest rate hikes
Reuters + NewBase
Oil prices rose on Friday on optimism that the U.S. Federal Reserve will ends its tightening cycle,
buoying the economy and boosting fuel demand.
Brent futures for March delivery gained 48 cents, or 0.6%, to $86.64 a barrel by 0113 GMT, while
U.S. crude advanced 54 cents to $80.87 per barrel, a 0.7% gain.
Oil price special
coverage

The benchmarks were on track for a second straight week of gains. Both closed 1% higher on
Thursday, near their highest closing levels since Dec. 1.
According to most economists in a Reuters poll, the Fed will end its tightening cycle after a 25 basis
point hike at each of its next two policy meetings, and then likely hold interest rates steady for at
least the rest of the year.
Federal Reserve Bank of New York President John Williams said on Thursday the U.S. central bank
has more rate hikes ahead, and sees signs inflationary pressures might be starting to cool off from
torrid levels.
A number of other Fed officials have expressed support for a downshift in the pace of rate rises.
Meanwhile the dollar index was headed for a second consecutive weekly decline. A weaker dollar
makes crude, priced in the currency, cheaper for foreign buyers.
Also extending support to prices, Chinese oil demand climbed by nearly 1 million barrels per day
(bpd) from the previous month to 15.41 million bpd in November, the highest level since February,
according to the latest export figures published by the Joint Organisations Data Initiative.
A rebound in Chinese economy and the Russian oil industry's struggles under sanctions
could tighten energy markets in 2023, International Energy Agency (IEA) head Fatih Birol said on
Thursday.

EIA forecasts lower wholesale U.S. N.gas prices in 2023 and 2024
U.S. Energy Information Administration, Short-Term Energy Outlook (STEO)
In our January Short-Term Energy Outlook (STEO), we forecast the natural gas spot price at the
U.S. benchmark Henry Hub will average $4.90 per million British thermal units (MMBtu) in 2023,
more than $1.50/MMBtu lower than the 2022 average.
We expect prices to stay nearly the same in 2024 as dry natural gas production continues to grow
in the United States and outpaces domestic natural gas demand and exports for most of the year.
We forecast the Henry Hub price will average close to $5.00/MMBtu in the first quarter of 2023; both
winter weather and liquefied natural gas (LNG) exports at near-capacity volumes will lead to greater
natural gas demand, which will result in higher prices in the United States.
After a warm start to January, we expect colder winter weather to return, prompting higher natural
gas consumption for space heating in the residential and commercial sectors, which causes prices
to rise.
We also expect the Freeport LNG export facility in South Texas, which shut down in June due to a
fire, to resume operations in the first quarter of the year. Resuming export shipments from Freeport
LNG will add approximately 2 billion cubic feet per day (Bcf/d) to overall U.S. natural gas demand,
which also contributes to higher first-quarter prices.
We expect natural gas prices to decline in the second quarter of 2023, then stay relatively flat for
the rest of the year as a result of:
 Winter weather subsiding, reducing domestic consumption
 U.S. LNG exports remaining flat once Freeport LNG comes back online
 Dry natural gas production continuing to rise
We expect U.S. natural gas production to increase by about 2% in 2023, averaging between 100
Bcf/d and 101 Bcf/d for the year.

We expect natural gas consumption to decline in the electric power sector as more renewable
electric-generating capacity comes online and overall electricity consumption declines as a result
of cooler summer weather than last year.
No new U.S. LNG export facilities are planned to come online in 2023; without new facilities, U.S.
LNG exports will not increase.In the first quarter of 2024, we expect natural gas prices to increase,
then drop below 2023 prices. In 2024, additional increases in dry natural gas production, which will
outpace higher LNG exports and slightly lower domestic consumption than in 2023, will put
downward pressure on natural gas prices.
We expect dry natural gas production to average more than 102 Bcf/d in 2024. Domestic natural
gas consumption will likely decline further, but rising U.S. LNG exports will partially offset the
reduced consumption.
We forecast that average monthly U.S. LNG exports will surpass 13 Bcf/d by the end of 2024 and
continue growing in 2025 as new export facility projects increase overall U.S. LNG export capacity.

NewBase Specual Coverage
The Energy world –January -20 -2023
CLEAN ENERGY
Europe Is Winning the Winter War by Sheer Luck
Bloomberg - Javier Blas
Javier Blas is a Bloomberg Opinion columnist covering energy and commodities. A former reporter
for Bloomberg News and commodities editor at the Financial Times, he is coauthor of “The World
for Sale: Money, Power and the Traders Who Barter the Earth’s Resources.” @JavierBlas
It may sound flippant to argue winter is over — after all, the weather has just turned cold in Europe,
it’s still the middle of January, and February and March lie ahead. For the European natural gas
market, however, the season is done and dusted.
This week, Europe is crossing the halfway point of its heating quarter. On average, the coming days
are typically the coldest of the year. Almost like clockwork, wintry weather returns and snow
bedecks the annual meeting of the World Economic Forum in the Alpine resort of Davos.
Indeed, from London to Berlin, temperatures have now dropped to freezing. But even if the rest of
the winter turns to be colder-than-normal, the region would have enough gas in storage to avert the
worst-case scenario: running out as a result of Russia reducing exports as part of its strategy against
Ukraine’s allies.
For gas traders, it’s a green light to sell. The wholesale price of natural gas in Europe fell earlier this
week to a 17-month low of 55 euros ($60) per megawatt hour, down more than 80% from a peak of
nearly 350 euros per MWh in late August.
Gas supplies are ample even if cold weather
returns in force. The bad news is that it means
climate change is still happening.

German wholesale one-year forward electricity prices, a regional benchmark, have also collapsed,
trading at around 150 euros this week, down from a peak of almost 1,000 euros six months ago.
To be sure, if the colder-than-normal weather of the next few days persists into February and March,
gas and electricity prices would rise again. But those gains would be limited. With half of the heating
season already in the rear-view mirror, and gas inventories high enough, a gas price super-spike
similar to what we witnessed last August is all but impossible.
Keep down your “Hip, hip hooray,” however. All this has come at a huge cost.
European governments have spent nearly 1 trillion euros subsidizing energy supplies. Despite that,
both natural gas and electricity wholesale and retail prices remain well above pre-crisis levels. Due
to lag effects, retail energy bills won’t drop until the second half of the year. And because
governments have insulated families from the brunt of the wholesale market price spike, they will
also see smaller price reductions in the future.
Nothing suggests a return to pre-2022 prices. For example, Cornwall Insight, a consultancy,
forecasts that the annual gas-and-power bill for the average UK family would hover around £2,800
in the second half of 2023. They’d been paying less than £1,500 in the four years through 2021.
Still, that’s a lot better than fears of bills topping £5,000 this year.
How did Europe go from crisis to relative calm in just six months?
First, the region got very lucky, for want of a better word, with the weather — a factor it cannot
control and the result of the broader calamity of climate change. Spring-like temperatures on New
Year’s Eve are a cause of celebration for anyone worried about gas prices. But they should be
concerning for anyone worried about the environment.

From Dec. 19 to Jan, 16, the key gas-consuming region of North-West Europe enjoyed 29
consecutive days of above-normal temperatures. That came on top of the 37 consecutive days of
warm weather from mid-October until mid-November.
Considered in heating degree days (HDD) — a measure of energy demand compared against
mean local temperatures — the winter has so far been about 12% warmer than the 30-year average.
In terms of gas consumption, that makes a huge difference. By now, North-West Europe should
have weathered at least 1,250 HDDs, but instead it has faced just 1,100 HDDs.
Europe’s Warm Winter May Not Be Such Good News For Energy
The last month has been a month of celebration in the European Union. Gas demand is down
because of the unusually warm weather. As a result, prices are down, and the crisis, according to
analysts, appears to be averted. The problem is that some of those analysts are adding the qualifier
“For now.”
The European Commission boasted an over 20-percent decline in demand in gas consumption on
the continent over the period between August and November last year. This was not just a result of
warm weather but also concerted action by European governments to discourage more demand.
Then December turned out to be as warm as October, and demand fell naturally, as did prices.
Some began talking about an end to the crisis and an end to the winter, even though in December,
the astronomical winter was just beginning.

January is turning out to be warm so far, adding substance to predictions that Europe lucked out in
a major way this winter and will finish it with enough of a gas cushion should another cold spell pay
Europeans a visit.
In fact, winter has been so mild there has actually been an unseasonable increase in gas storage,
Reuters’ John Kemp noted in a recent column. Only he also noted something else in that column.
That the second factor leading to this unseasonable increase was the decline in industrial gas
consumption. And the only way industrial consumers can reduce consumption is by shrinking their
operations.
This is the dark side of the success a lot of media are celebrating alongside Brussels. These
celebrations appear to ignore the fact that the 20.1-percent decline in gas consumption across the
bloc was also in no small part made possible by exorbitant gas prices that weighed on consumption
the way excessive prices always weigh on the consumption of a commodity.
Then there is the fact that although gas prices are down from last summer’s peaks, they are nowhere
near where they were in 2019. As Politico noted in a recent story about European gas demand and
prices, at close to 70 euro per megawatt-hour, European benchmark gas prices were about five
times what they were in 2019.
The problem that European politicians do not want to talk about is that as long as the EU relies on
LNG, these prices are not going to go much lower for the very simple reason that LNG could never
be as cheap as pipeline gas.
The other reason is that Russian pipeline deliveries are not returning any time soon, not along Nord
Stream 1, anyway, and this means that the EU will continue to rely on LNG both by choice and by
necessity for the observable future.
Over the short term, there’s some good news for Europeans. As wholesale prices on the TTF market
fall, so will retail prices when they catch up with the wholesale prices—retail energy suppliers buy

their gas on the wholesale market months in advance—and the winter may well continue mild. But
that would likely mean a dry, hot summer, too. And that would increase the demand for energy for
cooling purposes.
In fairness, Europe as a whole is a much smaller user of cooling technology than the United States,
but that’s largely because it is, for the most part, a colder place. If this warm winter is any indication
for this year’s summer, it will be a really hot one, pushing demand higher.
While unlikely to exceed traditional winter demand, this potential new summer demand for energy
could make the task of European countries rushing to refill their gas storage a bit harder, even with
gas left in storage from the previous heating season.
The goal for the next heating season will once again be 90-percent fill rates for all storage caverns
across the bloc. Last year, there was plenty of LNG—at the respective price—with the EU turning
into the world’s largest LNG importer in the world thanks to its sudden appetite for the superchilled
replacement for Russian pipeline gas.
Yet this year, according to analysts, Europe would need to import even more LNG to secure its
winter supply because there would be a lot less Russian pipeline gas than there was last year. One
might hope for another warm winter but relying on hopes is hardly a sound energy security strategy.
The International Energy Agency has already warned the EU is facing a supply gap of 30 billion cu
m of gas, even with all the demand destruction and deliberate demand cuts. And this gap might
prove tricky to fill with China’s LNG appetite returning, too, as the country reopens, even with doubts
about the success of this reopening still abounding.
It may, then, turn out that it is too early for the European Union to celebrate the warm winter,
especially since it appears that warm or not, the weather is not having any positive effect on the
EU’s emissions.

NewBase Energy News 20 January 2023 - Issue No. 1585 call on +971504822502, UAE
The Editor:” Khaled Al Awadi” Your partner in Energy Services
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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
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.

NewBase 20-January-2023 Energy News issue - 1585 by Khaled Al Awadi_compressed.pdf

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NewBase 20-January-2023 Energy News issue - 1585 by Khaled Al Awadi_compressed.pdf