Global Energy Review, Nov 6-12
Here's a summary of last week’s top global energy news with the potential to impact supply and demand.
China/ Solar power
After investing over $130 billion into solar power in 2023, China will remain dominant with more than 80% of the world’s polysilicon, wafer, cell, and module manufacturing capacity, said Wood Mackenzi. More than 1 TW of wafer, cell and module capacity will come online by 2024; thus, China’s capacity can meet annual global demand through 2032.
Egypt/ LNG
Egypt shipped 80% of its LNG exports to Europe last year, but that figure will now drop dramatically. On Oct 10, Israel's Tamar gas field was shut down by Chevron amid the Gaza conflict, impacting Egypt; Tamar’s natural gas exports go via a subsea pipeline between Israel and Egypt. Chevron is now shipping gas via an alternative pipeline through Jordan.
Germany/ Energy crisis
Energy-intensive manufacturing industries saw production drop 17% in September, below the level at the start of 2022 and with no sign of recovering. Experts say that energy-intensive manufacturing can’t be competitive while gas and power prices remain high.
Indonesia/ Energy transition
President Joko Widodo called on the West to release a promised $20 billion to finance his country’s energy transition. He said there was “tremendous” concern in Indonesia over the delay of the funds.
Mexico/ Natural gas
State energy company Pemex and New Fortress Energy terminated a deal to develop the country's first deepwater natural gas project that was signed a year ago. Pemex wants to continue with development in the Gulf of Mexico and is in talks with other companies.
Panama/ Copper
Panama might annul the contract for one of the world's biggest copper mines. This news has wiped out about 40% of the value of the $10-billion copper mine’s owner, Canada-based First Quantum Minerals. Copper is a critical metal for production of EVs.
Qatar/ LNG
China’s state-owned Sinopec signed a 27-year LNG supply and purchase agreement with QatarEnergy. They’ll cooperate on the second phase of the Gulf state's North Field expansion project, which will supply 3 mmt of LNG per year to Sinopec.
Russia/ Diesel
The Kremlin told fuel producers to prepare to scrap all restrictions on the export of diesel and gasoline. Russia, the world's top seaborne exporter of diesel, had introduced a ban on diesel exports on Sept 21 to tackle high domestic prices and shortages.
Texas/ Grid
The state set up a new energy fund to offer low-interest loans for natural gas plants, microgrids, and grid modernization. A total of $7.2 billion will go to new construction or upgrades that results in at least 100 MW of dispatchable generation coming online before June 2029. Another $1.8 billion will support development of microgrids and backup power for critical facilities, and $1 billion will go to grid modernization, weatherization, etc.
U.S./ DAC
BlackRock will invest $550 million into the world’s biggest direct air capture project in west Texas that’s being developed by Occidental Petroleum. Stratos, still under construction, aims to extract CO2 from the atmosphere. It’s one of the biggest-ever investments in DAC.
U.S./ Natural gas
Natural gas production and demand will set records in 2023, said the EIA. Dry gas production will rise to 103.7 bcfd in 2023 and 105 bcfd in 2024, up from a high of 99.6 bcfd in 2022. Domestic gas consumption will rise from a record 88.4 bcfd in 2022 to 89.4 bcfd in 2023, before sliding to 89 bcfd in 2024.