GECF ministers upbeat on natural gas outlook despite pandemic

The full promise of natural gas will unfold once the world is past the coronavirus pandemic, upbeat energy ministers of the leading gas exporting countries said at a recent GECF ‘Ministerial Roundtable’ held virtually
The full promise of natural gas will unfold once the world is past the coronavirus pandemic, upbeat energy ministers of the leading gas exporting countries said at a GECF Ministerial Roundtable held recently.
Natural gas is available in abundance, flexible enough to reach far-flung corners of the globe and less polluting to the environment.
As a sideline event to the 22nd Ministerial Meeting held under the auspices of Algeria recently, the virtual dialogue aimed to confront the array of challenges brought on by Covid-19 and the opportunities that are expected to propel natural gas to the top of the global energy mix by 2050.
The gathering of policymakers from the 20-member grouping featured two separate themes of short- and long-term perspectives, with the first session held under the title of “Natural gas in a post-Covid-19 world: A short-term view”, and the second entitled “Natural gas: a transition fuel or a destination?”
The first session was moderated by Stuart Elliot (S&P Global Platts) while Dr Bassam Fattouh (Oxford Institute for Energy Studies) was the second session moderator.
In his opening speech, Abdelmadjid Attar, Minister of Energy of Algeria, said, “I wish to underline the important role of natural gas in satisfying world energy needs. Natural gas is widely available. It is clean. It improves air quality, emits much less carbon dioxide than coal. It is flexible. These qualities of natural gas are recognised by many, if not all”
Attar, whose country is regarded as a pioneer in LNG with the first liquefaction plant commissioning in Arzew, Algeria in 1964, considered access to modern energy and protection of environment as two pressing issues.
“We need to ensure that the pandemic will not hinder progress on these two challenges. I wish to encourage the gas industry to strengthen its efforts in dealing with the issue of methane emission. This is important for natural gas to play a more important role in the energy transition that the world has engaged in,” explained Attar, while adding that Algeria’s vast gas resource will witness $20bn worth of investment in the next years.
GECF secretary general Yury Sentyurin advanced these comments by noting that natural gas is an energy option that achieves a harmonious balance between the environmental, social, and economic dimensions of sustainable development.
“GECF members are committed to strengthen global energy security as reliable suppliers of natural gas in order to meet the world’s growing energy demand. They showcased remarkable determination in their fulfilment of all contractual obligations to the customers. This indicates confidence in the strength of their economies and abilities to absorb major economic crises, notwithstanding numerous challenges and decline in revenues,” Sentyurin noted.
GECF’s Global Gas Outlook 2050 shows natural gas is growing at its fastest-ever rate and will become the largest global primary energy source by mid-century, from 23% today to 28% 2050.
Long-term demand is expected to grow by a remarkable 50%, from 3,950bn cubic metres (bcm) in 2019 to 5,920bcm in 2050.
Asia Pacific, North America, and the Middle East will carry more than 75% of this expected spur in demand.
Whilst the future looks promising, the short-term outlook seems dotted with perils for an industry being troubled by oversupply, bulging inventory, and now an economic recession.
Experts at the Roundtable noted that in 2020, for the first time in more than a decade, global gas consumption was expected to decline by 2 – 3.5% from the 2019 level. This slump in gas consumption has been driven by a combination of notable events, including above-normal temperatures in the northern hemisphere, weaker gas demand from the power, commercial, and industrial sectors due to lockdown measures, and weaker economic growth.
Next year, global gas demand is expected to grow between 1.5 – 4%, but will depend mainly on the extent of lockdown measures associated with the resurgence of the pandemic, the recovery in gas demand lost due to Covid-19, as well as the weather condition in the upcoming winter.
For the medium term, sustained growth in developing Asian countries, particularly China and India, are expected to contribute to an uptick in gas consumption in the coming years.


Mediterranean crisis calls for ‘civilized solution’, energy expert tells EU-Arab gathering

‘Do we want the benefits of our own rightful shares more than we want to deny the same benefits to our neighbors?’

ATHENS, Greece: The latest legal and technological tools can resolve rival claims in the Mediterranean without anyone firing a shot, a veteran of the region’s energy industry told a conference in Athens on Monday.

“We have both the legal mechanisms and the high-precision mapping technologies to draw up fair and equitable boundaries at sea,” Roudi Baroudi said in a speech to the 5th European Union Arab World Summit. “That means that countries in the Mediterranean region can settle their differences amicably, setting aside the costly and ultimately self-defeating ways of war.”

Appearing via Zoom from Doha, Qatar, Baroudi said the region had a long history of spawning great civilizations, but that each of these had squandered their good fortune by make war on their neighbors.

Thanks to huge deposits of natural gas having been found beneath the Mediterranean, he noted, “the region faces another crossroads”, largely because “the vast majority of maritime boundaries in the Mediterranean remain unresolved.” With neighboring states laying claim to the same undersea real estate, Baroudi said the resulting “patchwork of claims and counter-claims” only served to hamper all parties by jeopardizing their respective offshore oil and gas activities.

With more than four decades in the business – including significant experience in both the public and private sectors – Baroudi has become a leading proponent of the East Med’s emergence as a major energy producer. Having long argued that safe and responsible exploitation of the resource in question would allow regional countries to make historic gains, both at home and abroad, his most recent interventions have focused on how to draw fair and equitable boundaries at sea. In fact, his book “Maritime Disputes in the Eastern Mediterranean: The Way Forward” is widely regarded as the most authoritative guide to the current situation.

Currently serving as CEO of Energy and Environment Holding, an independent consultancy based in Doha, Baroudi said all parties need to be honest with themselves by answering single question: “do we want the benefits of our own rightful shares more than we want to deny the same benefits to our neighbors?”

Those that want to focus on getting their share, he argued, need to put their faith in the United Nations Convention on the Law of the Sea.

Roudi Baroudi is CEO of Energy and Environment Holding, an independent consultancy based in Doha.

He also is the author of “Maritime Disputes in the Eastern Mediterranean: the Way Forward”, published earlier this year by the Transatlantic Leadership Network and distributed by the Brookings Institution Press.



5th EU- Arab World Summit – Maritime Borders in the Mediterranean: the Cradle of Civilization Deserves a Civilized Solution



Elliott Discloses Stake in Takeover Target Noble Energy

Activist investor Elliott Management Corp. has taken a stake in Noble Energy Inc., the energy explorer that agreed in July to sell to Chevron Corp. for about $5 billion.

The stake was disclosed in a filing Tuesday with the U.S. Federal Trade Commission. Noble Energy and the New York-based hedge fund run by Paul Singer were granted early termination under the FTC’s Hart-Scott-Rodino Act — a requirement when an investor buys shares in a company above a certain threshold and seeks to hold discussions about such things as strategy or management changes.

he size of the stake and Elliott’s intentions aren’t known. Representatives for Elliott and Noble Energy weren’t immediately available for comment.

Chevron agreed to buy Noble Energy for the equivalent of roughly $10.38 a share at the time in the all-stock deal, a 7.5% premium over the last Friday’s close. Noble Energy investors are expected to vote on the deal Oct. 2.

Noble fell nearly 2% in trading Tuesday to $9.52 a share as of 12:18 p.m. in New York.

Elliott has a history of buying stakes in companies and pushing for changes, including breaking up potential transactions. It’s agitated at companies including AT&T Inc., Twitter Inc., and Softbank Group Corp., among others.



MTV – Turkey-Greece conflict in eastern Mediterranean



بعد التوتر اليوناني – التركي حول النفط: بارودي يحذر من نزاع مسلّح جدّي

تصاعدت التوترات بين اليونان وتركيا في الفترة الأخيرة بعدما أرسلت أنقرة سفينة للتنقيب عن النفط بالقرب من منطقة تطالب بها أثينا.

خبير الطاقة الدولي رودي بارودي أجرى في حديث لـ”سبوتنيك”، تقييماً للوضع المتفجّر بين الطرفين، فقال: إذا لم تلتزم الأطراف بالمبادئ ذاتها الناتجة عن اتفاقية الأمم المتحدة لقانون البحار، ولم تسارع إلى إيجاد أرضية مشتركة، فإن مخاطر النزاع المسلح جدية. فتركيا واليونان يمكنهما الاستئناف أمام المحاكم الدولية، ويمكنهما كذلك اللجوء إلى التحكيم إذا فشل الطرفان في الاتفاق على شكل من أشكال الإجراءات الدبلوماسية التقليدية لحل مطالبهما الإقليمية المتداخلة.

ووفق بارودي “يمكن ان يكون هناك حل عادل لكلا الطرفين، حل ينطلق من “منطق محايد” لقانون البحار، والذي تم استخدامه في مناسبات عدة في أجزاء أخرى من العالم لحل النزاعات سلمياً. ويمكن لشركات مثل Fugro التي تقدمّ حلولاً متقدّمة لرسم الخرائط و/ أو تستخدم خرائط عالية الدقة للشواطئ، أن تقدّم سريعاً “نتائج دقيقة ومتّسقة” لكل ولاية”. وتابع: هذا هو الطريق: الاعتماد على القانون والعلم والقواعد المعمول بها… وليس على التهديدات والشرائع.

وتعليقاً على الاتفاقات التي وقّعتها من أجل إعادة تحديد حدودها البحرية، تركيا مع ليبيا في عام 2019 من جهة، واليونان مع مصر في 6 آب من جهة أخرى، وما إذا كانت هذه المعاهدات معترف بها من قبل الدول المجاورة والمجتمع الدولي، قال بارودي “في الوضع الراهن، حدّدت هذه الدول الساحلية الحدود البحرية التي يبدو أنها تضمّ مناطق متداخلة ولا يزال لدى الدولتين الحق في رسم مثل هذه الحدود بموجب القانون الدولي، لكن هذه المعاهدات تلزم فقط تلك الدول التي تصادق عليها وليس دولًا ثالثة”.

 



Conflit maritime gréco-turc: «les tensions pourraient conduire à un réel conflit armé»

La tension est à son comble entre la Grèce et la Turquie depuis l’envoi par Ankara d’un navire de recherche près d’une zone revendiquée par Athènes. Selon Roudi Baroudi, expert en énergie et des conflits en Méditerranée, si les parties ne trouvent pas rapidement un terrain d’entente, les risques d’un conflit armé sont réels. Entretien.

Rien ne va plus entre Athènes et Ankara depuis qu’un navire turc consacré à la recherche sismique a été envoyé tout près de l’île grecque de Kastellorizo. Aussi connue sous le nom de Megísti, l’île est située à deux kilomètres des côtes turques et à environ 580 kilomètres d’Athènes. Après avoir brièvement suspendu ses recherches d’hydrocarbures, Ankara a annoncé que son opération allait reprendre. Pour soutenir la Grèce, la France a décidé de renforcer sa présence dans les eaux disputées.

Pour faire le point sur cette situation explosive, Sputnik s’est entretenu avec Roudi Baroudi, spécialiste de l’énergie internationalement reconnu. M.Baroudi a notamment travaillé en collaboration avec la Banque mondiale, le FMI, la Commission européenne, l’Agence des États-Unis pour le développement international et le Fonds arabe pour le développement économique et social. Il vient de publier le livre Maritime Disputes in the Eastern Mediterranean (Éd. Brookings), consacré aux conflits en Méditerranée.

Sputnik: Est-ce le début d’un conflit majeur?

Roudi Baroudi: «La première chose à considérer est que si les parties n’adhèrent pas aux mêmes principes découlant de la Convention des Nations unies sur le droit de la mer, le différend ne peut pas prendre fin. Si tel est le cas, les 20 prochaines années ne peuvent que ressembler aux 20 dernières années: les tensions vont persister ou, pire, conduire à un réel conflit armé.

La réalité est que ces derniers jours, le navire d’exploration turc a effectué des tirs sismiques dans une zone qui ferait presque certainement partie de la Zone économique exclusive reconnue de la Turquie si les parties appliquaient les principes de la Convention des Nations unies sur le droit de la mer et respectaient celui d’équidistance. C’est un constat auquel les parties pourraient en venir si elles voulaient en arriver à une solution équitable tenant compte de toutes les caractéristiques de la zone immédiate. Autrement dit, si les deux pays s’engageaient à négocier une solution équitable ‘‘à la lettre’’, en mettant en œuvre les règles établies dans le cadre de la Convention des Nations unies sur le droit de la mer.»

Sputnik: Selon l’expert Christian Fleury, interrogé récemment par Sputnik, la Méditerranée regorge de conflits potentiels de ce type. La Méditerranée peut-elle vraiment devenir une poudrière à cause de la recherche d’hydrocarbures?

Roudi Baroudi: «Eh bien, cela est vrai en Méditerranée orientale où le conflit israélo-arabe, par exemple, dure depuis plus de 75 ans et en raison d’autres facteurs. Néanmoins, si les dirigeants de la région devaient s’asseoir et s’engager véritablement à résoudre leurs différends pacifiquement –comme ils sont tenus de le faire en vertu de la charte des Nations unies et tenus d’utiliser les structures de partenariat de l’UE disponibles–, je ne doute pas qu’ils pourraient finir par conclure des accords qui isolent la recherche de profits liée aux hydrocarbures des effets de leurs désaccords politiques.

À certains égards, cela s’applique en particulier à la Grèce et à la Turquie. Ces deux pays sont actuellement dirigés par des individus dont les référents nationalistes les encourageraient sans doute à parvenir à un accord. Il est important de noter que si la Grèce et la Turquie ont déclaré unilatéralement leurs frontières maritimes hypothétiques, aucune de leurs revendications n’a été enregistrée, publiée ou même déposée auprès de la Division des affaires maritimes et du droit de la mer des Nations unies, ce qui signifie qu’elles ne sont pas reconnues internationalement.

Il existerait une solution équitable pour les deux parties, celle qui procède d’une ‘‘logique neutre’’ du droit de la mer et qui a été utilisée à plusieurs reprises dans d’autres parties du monde pour résoudre pacifiquement des conflits similaires. Cette solution tiendrait compte des petites îles grecques isolées tout en offrant le meilleur compromis aux deux États côtiers pour l’ensemble de la mer Méditerranée.»

Sputnik: Selon vous, la Turquie et la Grèce devraient donc faire appel aux tribunaux internationaux?

Roudi Baroudi: «C’est définitivement une option, tout comme l’arbitrage, si les parties ne parviennent pas à se mettre d’accord sur une forme de procédure diplomatique conventionnelle pour résoudre leurs revendications territoriales qui se chevauchent. Quelle que soit la manière de dialoguer, tant qu’ils acceptent de suivre les principes de la Convention des Nations unies sur le droit de la mer, les progrès récents de la technologie rendent le résultat des négociations beaucoup plus prévisible qu’il ne l’aurait été auparavant.

Des entreprises comme Fugro offrant des solutions de cartographie avancées et/ou utilisant une cartographie de haute précision du littoral peuvent fournir rapidement et précisément des ‘‘résultats reproductibles cohérents’’ pour chaque État (ou d’autres entités) comme jamais auparavant. Ces nouvelles technologies tournent la page de décennies de méfiance, laquelle a toujours représenté un grave problème quand il fallait définir des frontières maritimes offshore.

Ces nouvelles technologies permettent une cartographie précise des points de terminus terrestre (les régions frontalières de l’interface terre-mer), et en mer, des points de trijonction, c’est-à-dire là où, précisément, les Zones économiques exclusives de trois États côtiers se rencontrent pour former un point commun. Ces nouvelles technologies éliminent d’autres éléments sur lesquels il pourrait y avoir des différends et facilite l’interprétation de laConvention des Nations unies sur le droit de la mer afin que les deux parties obtiennent une ‘‘victoire’’ de manière équitable.

La Grèce et la Turquie ont la possibilité de suivre, entre autres, l’exemple des règlements des litiges ayant opposé le Bangladesh et le Myanmar, le Nicaragua et le Honduras, la Libye et la Tunisie, etc. C’est la voie à suivre: s’appuyer sur la loi, la science et les règles en vigueur et non sur les menaces et les canons.»

Sputnik: Afin de redéfinir leurs frontières maritimes, la Turquie a signé un accord avec la Libye en 2019 tandis que la Grèce en a signé un avec l’Égypte le 6 août dernier. Ces traités sont-ils reconnus par les États voisins et la communauté internationale?

Roudi Baroudi: «Dans la présente situation, ces deux paires d’États côtiers ont défini des frontières maritimes extracôtières qui semblent avoir des zones de revendication qui se chevauchent. Pour chaque paire d’États côtiers (la Turquie et la Libye ainsi que la Grèce et l’Égypte), ces accords peuvent être considérés comme des tentatives de définir de nouvelles frontières bilatéralement. Cependant, étant donné que les accords provisoires potentiels ne prenaient pas en considération les effets possibles sur les droits des États voisins, ils sont uniquement considérés comme des accords bilatéraux. Deux pays ont toujours le droit de tracer ce genre de frontières en vertu du droit international, mais ces traités n’engagent que les pays qui les ratifient et jamais les pays tiers.»



Doha and New Delhi should explore possibilities of a natural gas pipeline: Official

Doha and New Delhi should explore possibilities of a natural gas pipeline and Qatar could be India’s “strategic food reserve”; according to Suresh Prabhu, India’s Sherpa to the G20 and a former Commerce Minister.
“One area that needs to be refocused is how to get natural gas into India through the pipeline (from Qatar),” Prabhu told a webinar hosted by Doha Bank.
Highlighting that the efforts should be to explore ways in a manner that is beneficial to both the countries; he said there should be negotiations in price in such a way that it could meet the energy requirement; while not affecting Qatar’s coffers too much.
Prabhu’s call regarding this comes in the wake of India’s ambitious programme to reduce greenhouse gas emissions.
India currently has almost two-third of its electricity generation from thermal, and gas addition can reduce the coal output and will lead to lower emissions, he said, adding sourcing more natural gas from Qatar to India will be a win-win for both the countries.
Highlighting that Qatar and India can work bilaterally on food security, he said just as India’s energy security is important, food security of the Gulf is far more important.
“India could create a hub in Qatar so that we can have strategic food reserves in Qatar. We can have meat, dairy, marine, agri and horticulture products exported to Qatar and make it strategic reserves,” he said, reasoning this made sense in a time that has seen disruptions to trade and supply chain.
Suggesting that Qatar look at India’ pharmaceutical sector, the investments in molecules would have far higher returns than those from the US treasury papers, where interest rate is near zero.
“The investment in pharmaceutical sector can be a game changer,” Prabhu said.
Atul Punj, chairman, Confederation of Indian Industry National Committee on Construction and chairman, Punj Lloyd; said construction industry accounts for 40% to 50% of India’s capital spend.
In order to attract Qatari capital, India needs to set up a contract regime which is universal in nature and time-bound dispute resolution, whereas for the Indian companies to participate in Qatar’s construction it has to have best in class services, supply of labour and manpower, he said.
In the infrastructure sector, high end real estate development and affordable housing are the key areas where Qatar can invest in India.
Chandrakant Salunkhe, founder and president SME (small and medium enterprises) Chamber of India, said Indian SMEs and Doha Bank work together to establish their presence which makes them competitive.
In this regard, Doha Bank chief executive Dr R Seetharaman said together they can explore mezzanine financing and partially guaranteeing debt.


Global LNG exports shrink a 3rd month as virus curbs demand

The liquefied natural gas market contracted a third month in July as countries continue to struggle with the economic fallout from the coronavirus pandemic.
Global exports of the fuel last month dropped 9.4% from the previous year, the steepest year-over-year decline since at least December 2017, according to ship-tracking data compiled by Bloomberg. The biggest cuts came from the US and Australia. On a monthly basis, exports inched up 2.5% from June levels.
The pandemic has thrown cold water on the fastest-growing fossil fuel, with demand seen possibly extending its decline through 2021. A slew of once-promising export projects are struggling to find financing as the LNG market’s breakneck expansion stalls, threatening a worse supply glut over the next decade.
Royal Dutch Shell Plc and Total SE are among the world’s top LNG suppliers, and have invested billions of dollars into export facilities in order to capture the fuel’s burgeoning demand.
Some of the world’s biggest buyers of LNG have struggled to make room for contracted shipments this summer as Covid-19 stalled economic activity and left stockpiles near capacity. This has forced exporters to make the difficult decision to lower output and withhold cargoes from the market in a bid to balance global supplies.
US exports fell about 40% from a year earlier due to customers potentially cancelling over 50 cargoes slated to load from Gulf Coast projects after the arbitrage opportunities to Europe and Asia collapsed.
Spot prices in Asia, the biggest demand region for the fuel, have started to recover from record low levels amid speculation that onset of the winter heating season will boost consumption.
Meanwhile, imports of the fuel fell by 5.1% from a year earlier as Covid-19 measures forced buyers to reduce deliveries. It was the second-straight month for declining imports, after June marked the first year-over-year drop since at least December 2017.
South Korea’s imports for July dropped by more than 800,000 tonnes compared to last year, the most of any nation, as its top buyer requested to delay shipments on high inventory levels. While Japan imported nearly 5.7mn tonnes last month, the most since March, it is still lagging 2019 levels by about 9.3%.



Barzan project, North Field expansion to boost Qatar’s growth: Lloyds Ban

The expected commissioning of Barzan natural gas facility could support domestic gas production and contribute positively to Qatar’s growth, Lloyds Bank has said in an overview.

In the medium term, the expansion of North Field gas projects is expected to be completed by 2024, further boosting gas output, it said.

Qatar has been implementing an economic diversification programme to lower its dependency on the hydrocarbon sector, and in December 2018 the country announced it would leave Opec (Organisation of the Petroleum Exporting Countries) in January 2019 to focus its efforts on natural gas.

New projects are planned in infrastructure and telecommunications, and various construction projects are in progress in preparation for the World Cup in 2022. Inflation was estimated to have fallen to -0.6% last year from 0.2% in 2018, Lloyds Bank said.

IMF estimated inflation to decrease to -1.2% in 2020 and increase to 2.4% in 2021 in its latest World Economic Outlook of April 2020; indeed, Qatar has postponed plans to introduce a VAT to 2021 the earliest, suggesting inflation will continue to remain weak this year.

Qatar’s economy started to grow faster after the first quarter of 2019 as government spending rose, particularly with regards to wages in the public sector. This helped boost the economy later in the year, which had showed signs of a slowdown as most major infrastructure and construction projects in relation to the World Cup came to completion, it said.

Nonetheless, general government debt was also estimated to have grown to 53.2% of GDP in 2019, from 48.6% a year earlier, as the country continued to borrow in international markets.

The International Monetary Fund anticipates a debt reduction in the coming years, 48% in 2020 and 43.1% in 2021. Current account surplus narrowed to 2.4% of GDP in 2019 from 8.7% a year earlier as global energy prices fell.

However, the IMF expects this trend to be heavily affected by the negative economic impact of the Covid-19 pandemic and the fall in oil prices. The current account balance should be negative in 2020 and 2021 (-1.9% and -1.8%, respectively), Lloyds Bank said.

Qatar is the world’s leading exporter of liquefied natural gas and holds the third largest gas reserves in the world (estimated at 16% of the global total). The country’s economy is thus heavily concentrated in the gas industry, which represents two-thirds of its GDP and almost 80% of export earnings.

Like other Gulf countries, Qatar has been hit by the global decline in oil prices since 2014.

“However, the economic results have been better than that of its neighbours, due to successful economic diversification, namely via the development of large-scale projects,” Lloyds Bank said.