Daily Energy News
Californian energy utility Pacific Gas & Electric Company (PG&E) is preparing to seek bankruptcy protection under Chapter 11 of the United States Bankruptcy Code, amid pressure from potentially staggering liabilities related to wildfires in 2017 and 2018 (estimated at more than US$30bn). Once the company files for this chapter, lawsuits will be paused and creditors will no longer be able to call loans or demand interest payments, which leaves room for the reorganisation of the company and allow a more effective settlement of disputes.
Policy & Regulatory
According to a report published by the European Commission, the United Kingdom (UK) is the largest funder of fossil fuels in the European Union and pumped about €12bn into fossil fuel support in 2016, followed by Germany, France, Italy and Spain. However, these countries invested more to support the development of renewable energies such as wind and solar than on fossil fuels like coal, gas and oil.
The Indonesian Energy and Mineral Resources Ministry has outlined a new programme meant to develop the residential gas network. It aims at accelerating the yearly rate of new connections to the gas network, which currently ranges between 70,000 and 80,000 connections per year, to
nearly 1 million new connections per year, in order to reach 4.7 million of new connections between 2019 and 2024. The government seeks to reduce the consumption of liquid petroleum gas (LPG), which averages 6.5 Mt/year and of which around 60% is imported.
The governor of New York (United States) has announced a new offshore wind capacity target of 9,000 MW for 2035, which is a nearly fourfold increase compared with the previous target of 2.4 GW by 2030. The additions in offshore wind capacity are essential in order to achieve its renewable electricity target of 70% by 2030, up from the previous target of 50%. The state also committed to 6,000 MW of solar capacity (up from 3 GW) and to double its onshore wind capacity by 2025. Around US$1.5bn will be invested in offshore wind and other renewable projects in 2019.
According to the United States Energy Information Administration (EIA), the current US natural gas market trends are expected to continue throughout 2019 and 2020. In particular, US domestic gas production is expected to rise from an estimated 83.3 bcf/d (858 bcm/year) in 2018 to approximately 90.2 bcf/d (929 bcm/year, +8.3%) in 2019 and 92.2 bcf/d (950 bcm/year, +2.2%) in 2020. The bulk of the production and takeaway capacity increases are predicted to come from the highly productive Appalachian and Permian basins regions.
Infrastructure & Investments
Project company Numaligarh Refinery, a subsidiary of the Indian oil company Bharat Petroleum, has received clearance from the Cabinet Committee on Economic Affairs of India for development of the 120,500 bbl/d expansion project at the Numaligarh refinery in the Golaghat district of Assam (northeastern India). Once built, the RUP225.9bn (US$3.2bn) project will triple the crude oil processing capacity of the Numaligarh refinery, from 60,250 bbl/d to a total of 180,750 bbl/d.
The Egyptian Ministry of Electricity and Renewable Energy has announced that the 300 MW power interconnection project with Sudan is moving forward and is slated for activation in February 2019. All the pylons that will be used for the construction of the power line have been completed by the Indian construction firm Larsen & Toubro (L&T). The 220 kV line will span across 169 km within the Egyptian and Sudanese territories. It may later be upgraded to 500 kV to deliver up to 3,000 MW of electricity.
Under the OPEC and non-OPEC agreement to reduce global oil output, Algeria has decided to reduce its oil production by around 24,000 bbl/d - 25,000 bbl/d from the current 1.08 mb/d. According to the state-run oil and gas company Sonatrach, the country still has some spare production capacity and only reduced its production in order to respect the agreement's quota.