It’s possible that I shall make an ass of myself. But in that case one can always get out of it with a little dialectic. I have, of course, so worded my proposition as to be right either way (K.Marx, Letter to F.Engels on the Indian Mutiny)
Tuesday, September 28, 2021
Major Coal Consumer India Sees Stockpiles Slump To Four-Year Low
Amid a global energy shortage, India, one of the world’s largest coal consumers, has inventories of the fuel at its lowest level since November 2017, government data cited by Bloomberg showed on Monday.
Coal accounts for more than 75 percent of India’s electricity mix, according to data from the International Energy Agency (IEA).
Amid surging natural gas prices, utilities all over the world are firing up more coal-fueled power generation units, driving up coal demand and prices.
A shortage of coal in a major consumer such as India could force power plants to buy more expensive imports of coal or bid up prices in domestic power auctions. This would raise the costs of India’s manufacturing and the whole economy, which is already feeling the pinch of higher oil prices this year.
“India has done well to expand its power generation capacity, but has failed to give similar attention to coal supply infrastructure,” Debasish Mishra, a partner at Deloitte Touche Tohmatsu based in Mumbai, told Bloomberg.
Coal prices are surging everywhere in tighter global energy markets.
European coal prices hit a 13-year high last week as coal supply to Europe remains constrained, and utilities fire up more coal power plants amid surging natural gas prices.
The rally in natural gas prices is also spurring on global demand for coal. China and India look to replenish low stocks of coal, driving coal prices in Asia to records.
Earlier this month, Goldman Sachs nearly doubled its price projection for coal prices in Asia, expecting the benchmark Newcastle thermal coal to average $190 a ton in the fourth quarter, up from a previous forecast of $100 per ton, due to sky-high gas prices ahead of the winter heating season.
India, one of the world’s largest carbon dioxide emitters, could add more coal-fired electricity generation capacity despite the global push for clean power sources. India is not part of the dozens of nations that have already vowed to achieve net-zero emissions by 2050 or, in China’s case, by 2060.
By Tsvetana Paraskova for Oilprice.com
Sudan Strikes Deal With Protesters To Allow Oil Exports
The Sudanese government has reached an agreement with protesters to lift blockades off Red Sea ports, including an export hub for South Sudan oil.
Reuters reports that local tribes have been protesting against bad economic conditions in eastern Sudan and have blocked roads and ports, including one that ships crude oil from South Sudan to international markets.
The agreement between the government and the protesters staved off an imminent disaster: the petroleum ministry warned that the storage capacity of Sudan's oil export terminal would fill up within ten days. If that had happened, South Sudan oilfields would have had to stop producing.
Landlocked South Sudan is home to most of the oil reserves of the old united Sudan, and while most of these reserves have yet to be tapped, the country is producing well above 100,000 bpd, hitting a high of 185,000 bpd earlier this year, right before its first-ever licensing round.
Currently, South Sudan has five producing blocks, operated by China National Petroleum Corporation (CNPC), India's Oil and Natural Gas Corporation, and Malaysia's Petronas.
"The oil licensing round aims to attract interest from a diverse group of foreign investors to a region that is already home to oil and gas majors from China and Malaysia," said the country's Ministry of Petroleum at the time.
South Sudan broke from Sudan in 2011, taking with it around 350,000 bpd in oil production. But then civil war broke out in South Sudan in 2013, which further complicated oil production.
In 2018, the warring factions in South Sudan signed the so-called Khartoum Declaration of Agreement, in which the parties to the South Sudan conflict declared a permanent ceasefire, and the governments of Sudan and South Sudan explored ways to rehabilitate the oil sector in South Sudan.
According to the South Sudan Petroleum Ministry, as much as 90 percent of the country's oil wealth remains unexplored.
By Charles Kennedy for Oilprice.com
50-Fold Jump In Power Rates Hits UK Metal, Mining Sector
Soaring power prices amid Europe’s gas crunch will have a lasting impact on the bottom lines of mining and metal companies as prices in their long-term electricity supply contracts will increase, an executive at a Swedish metals producer told Bloomberg on Friday.
“Contracts will have to be renewed sooner or later. However they are written, you will eventually get hurt because of the situation in the market,” Mats Gustavsson, vice president for energy at Sweden’s metals producer Boliden, told Bloomberg in an interview.
“If you are exposed to the market, the operational expenses have of course increased,” Gustavsson said.
As companies mining and processing metals are looking to cut their carbon footprint, they electrify some processes and use more electricity. However, soaring electricity prices will hike their operating costs, diminishing profit margins.
The price spikes and volatility are here to stay, according to Boliden’s Gustavsson, who says that metal producers may have to contend with higher power prices for longer.
The metals sector is the latest in the heavy industry to suffer from the surging natural gas and power prices in Europe. The price spikes have already started to hit industrial activities, threatening to deal a blow to the post-COVID recovery in Europe.
Giant European firms, from chemicals and mining to the food sector, say sky-high gas and electricity prices are hitting their profit margins and forcing some of them to curtail operations.
Some factories have shut down because of record natural gas prices. More idling of industrial activity across Europe is likely in the coming weeks, analysts say.
Earlier this week, British Steel, the second-largest steel producer in the UK, warned that electricity prices are “spiralling out of control,” and a 50-fold jump in quoted power rates makes production unprofitable at certain times in the UK, the Financial Times reported.
By Tsvetana Paraskova for Oilprice.com
New Grid Standards Set To Prevent A Texas Freeze Repeat
The Federal Energy Regulatory Commission and the North American Electric Reliability Corp have devised and issued a set of new grid reliability standards to avoid a repeat of the Texas Freeze that left millions without power and heating amid a cold spell and saddled thousands with massive electricity bills.
"I cannot, and will not allow this to become yet another report that serves no purpose other than to gather dust on the shelf," said Rich Glick, chairman of the FERC, as quoted by Reuters.
Among the new requirements is one that should see utilities identify and take steps to protect cold-weather critical components of the grid, build new units, or retrofit existing ones to be able to withstand extreme weather, and prepare plans for handling freeze-related outages.
The Texas Freeze, which was the result of a Polar vortex that froze swathes of the U.S. but hit the Lone Star State the hardest, caused power outages because power plants simply froze as their operators had not weatherized them. It also caused a shortage of electricity because many gas wells that supply the commodity to the plants also froze. The cold spell resulted in the biggest drop in U.S. oil production, too, at 40 percent of the nation's total.
As a result of all these outages and shortages, at one point as many as 2 million Texans were without power, gas prices hit record highs on the wholesale market, and ERCOT resorted to rolling blackouts.
The new standards by the FERC and NERC are supposed to help prevent this from happening again. FERC does not have jurisdiction over ERCOT—the Texas grid operator—but NERC does have jurisdiction when it comes to reliability matters.
Texas is working to prevent another Freeze, too, which many blamed on the fact that the Texas grid is isolated from the national grid, which made it extra vulnerable to the effects of extreme weather.
By Charles Kennedy for Oilprice.com
U.S. Arrests Senior Russian LNG Executive For Tax Fraud
The U.S. Department of Justice has arrested the chief financial officer of Novatek, Russia’s largest private gas company and biggest LNG exporter, on charges of tax fraud.
In a statement, the DoJ said that Mark Gyetvay had engaged in a scheme to defraud the United States by hiding his ownership of sizeable offshore assets—a sum of about $93 million—and had also failed to file tax returns and pay taxes “on millions of dollars of income.”
According to the DoJ, Gyetvay engaged in the concealment practice after he became the chief financial officer of Novatek, upon which he was allegedly presented with “lucrative stock options and/or stock-based compensation”.
Gyetvay then proceeded to set up two Swiss bank accounts, according to the DoJ allegations, where he put these assets and then removed himself as the owner of the accounts by transferring ownership to his then-wife, who was a Russian citizen.
In addition to this asset concealment, Gyetvay also “allegedly did not timely file his U.S. tax returns, nor did he file all of the required Reports of Foreign Bank and Financial Accounts (FBARs) forms certain U.S. taxpayers are required to file annually that disclose their control over assets maintained in foreign bank accounts.”
On top of that, according to the allegations, some of the taxes that Gyetvay did file were false. He also allegedly submitted a false offshore compliance form with the U.S. tax authorities, saying that his former failure to submit the forms relevant to holdings in foreign banks had not been wilful.
According to a report in the Financial Times, Mark Gyetvay, who helped expand Novatek into the LNG export major it is today, is one of the most popular business executives in Russia and internationally in the oil and gas industry. If found guilty, he faces decades in prison.
By Irina Slav for Oilprice.com
JPM, Barclays, And Citigroup Are Betting Big On Arctic Oil
Oil and gas companies are set to ramp up production in the Arctic by 20 per cent in the next five years, according to a new report shared with City A.M. this morning.
The main Arctic expansionists – Gazprom, Total and ConocoPhillips – are backed by hundreds of billions of pounds from dozens of City banks and investors, despite many holding commitments to restrict fossil financing in the region, Paris-based think tank Reclaim Finance claimed this morning.
The report details £230 billion of loans and underwriting from commercial banks to Arctic oil and gas expansionists between 2016 and 2020, including numerous key players from the City.
JPMorgan Chase was the biggest investor with $18.6 billion, followed by Barclays ($13.2 billion), Citigroup ($12.2 billion) and BNP Paribas ($11.8 billion).
Investors are further holding around $272 billion in Arctic fossil developers as of March of this year, with BlackRock ($28.5 billion), Vanguard ($21.6 billion) and Amundi ($12.9 billion) leading the pack, all without Arctic exclusion policies.
Restriction policies
Despite numerous commitments from financial institutions not to support oil and gas extraction in the Arctic, the report found that 20 of the 30 banks that are fuelling expansion in the Arctic region have so-called Arctic restriction policies, not a single one excludes support to companies developing new oil and gas projects in the region.
Notably, HSBC and BNP Paribas were the top financiers of Arctic expansionists in 2020, despite adopting Arctic exclusion policies early on compared to their peers.
Meanwhile, amongst insurers, essential players for Arctic oil and gas extraction, 13 out of the world’s top
46 companies have an Arctic sector underwriting policy.
Climate breakdown
The findings come just weeks after the International Panel on Climate Change warned of accelerating climate breakdown in the Arctic, with temperatures rising twice as quickly as elsewhere, while NASA s set to release its annual survey of Arctic sea ice loss in the coming days.
Commenting on the findings, the report’s author, Paris-based Alix Mazounie, told City A.M. this morning: “The Arctic is a climate bomb, and our research shows that the oil and gas industry is hellbent on setting it off, thus blowing up our chances of avoiding runaway climate breakdown.”
This interactive map allows you to select a bank, investor or insurer and to navigate through the oil and gas companies involved in the Arctic.
By City AM
Microbial 'theft' enables breakdown of methane, toxic methylmercury
Researchers gained new insights into the mechanisms some methane-feeding bacteria called methanotrophs use to break down the toxin methylmercury. Credit: Andy Sproles/ORNL, U.S. Dept. of Energy; Jeremy Semrau/Univ. of M
A team led by the Department of Energy's Oak Ridge National Laboratory and the University of Michigan have discovered that certain bacteria can steal an essential compound from other microbes to break down methane and toxic methylmercury in the environment.
The findings could inform strategies that aim to manipulate these microorganisms to reduce emissions of methane, a powerful greenhouse gas, and detoxify methylmercury, a potent neurotoxin that can accumulate in the food supply.
The study, published in The ISME Journal, found that certain classes of methanotrophs or methane-consuming bacteria that were previously thought unable to degrade methylmercury can actually break it down in the environment. This activity is possible because the microbes are equipped with the cellular machinery to absorb and use a compound called methanobactin that is produced by other microbes.
Methanotrophs are widespread in nature. They live near methane and air interfaces, such as the topmost layer of soils, river sediments and wetlands where they can access oxygen while feeding on the methane that flows up from the anoxic, or oxygen-deficient, environments below.
These bacteria play a critical role in the carbon cycle, consuming substantial amounts of methane generated by other microbes called methanogens. This natural counterbalance is important in limiting methane emissions, which are 25 times more potent than carbon dioxide at warming Earth's atmosphere.
Understanding more about the way the methane-feeders function may point to methods to use them like levers to control methane emissions. The new knowledge can also better inform climate models that predict the planet's future.
Researchers discovered these new methanotroph behaviors while studying another global problem: mercury pollution. ORNL has a long history of breakthroughs related to mercury, including their 2013 discovery of the genes that enable microbes to transform mercury into the toxin methylmercury.
In 2017, an ORNL-led team was the first to demonstrate that some methanotrophs can break down methylmercury, a process called demethylation. Their newest findings build on that discovery, showing that more methanotrophs than previously known can degrade methylmercury.
"As we gain new insights about methanotrophic activities, we may be able to more effectively manipulate these microbial communities to reduce methane emissions and enhance mercury detoxification in the environment," said Baohua Gu, an ORNL corporate fellow and biogeochemist.
Producers and cheaters
Methanotrophs are looking for the easiest, quickest food supply, with a target of single-carbon compounds like methane and methylmercury, which have similar chemical structures. These microbes also require copper to fuel their metabolic processes. It is this need for copper that can limit methanotrophic activity, driving the microbes to seek copper sources in the environment using many different methods.
Some methanotrophs use a surface protein to secure copper. Others secrete a compound called methanobactin, or MB, that binds with copper in the environment and facilitates copper acquisition. Previous findings by the team had shown that only bacteria with the genetic and metabolic machinery to produce MB can break down methylmercury.
The researchers' latest findings demonstrate that some methanotrophs that do not make MB can detoxify methylmercury by using MB secreted by other methanotrophs. In other words, they steal it.
"They are effectively what we call cheaters," said University of Michigan microbiologist Jeremy Semrau. "This has been observed before, where one microorganism produces something that is of benefit to the general community and others steal it. This enables some methanotrophs to meet their copper requirements."
The research team also showed that successful theft of MB requires that methanotrophs have the gene, named mbnT, that enables production of a specific protein called the TonB transporter. Aptly named, this protein moves MB—and the associated copper—into the microbe, enabling the breakdown of methylmercury and methane.
Scientists at U-M engineered a strain of methanotrophs without the mbnT gene, and the team at ORNL analyzed the mercury in the samples. The removal of the mbnT gene and transporter protein in these microbes effectively disabled their ability to take up MB or detoxify methylmercury.
These insights could inform future paths toward addressing mercury pollution in the environment.
"I think it's a wonderful strategy going forward where we might be able to utilize methanotrophs to help remediate mercury contaminated sites, and that this might actually be going on, to some extent, naturally," Semrau said.
Another piece of the puzzle
Methanotrophs are common in the environment, but there is still a lot to learn about their activities. A team led by ORNL environmental scientist Scott Brooks collaborated with Semrau's group at U-M on the discovery of several novel methanotrophs in East Fork Poplar Creek, a mercury-contaminated stream flowing through the Oak Ridge Reservation that has been studied for decades.
Brooks and his team have been studying biofilms, which are complex communities of algae and bacteria that accumulate on creek rocks as "green slime." Though biofilms are only about as thick as a few stacked credit cards, they are hot spots for mercury and nutrient processing.
The ORNL team had previously found that oxygen-deficient pockets within these biofilms house microbes that are transforming mercury into its most toxic form: methylmercury. Their recent discovery of methanotrophs in the oxygen-rich recesses of these same biofilms means that methylmercury breakdown is also occurring naturally in the creek.
"There are some really steep chemical gradients and changes in concentration taking place over a very small distance," Brooks said. That includes dissolved oxygen that "disappears within a few tenths of a millimeter."
Those tiny pockets of oxygen are enough for methanotrophs to thrive. Preliminary analysis showed that microbial activity producing methylmercury outpaced the methanotrophic activity breaking down the toxin. With further study, scientists could potentially identify methods of tipping the balance toward methylmercury degradation.
"This is a nice marriage of two different research projects working in parallel," Brooks said. "We're seeing things that are consistent with one another and that helps us confirm what is happening with mercury cycling in these complex microbial communities."Newly identified microbial process could reduce toxic methylmercury levels
More information:Christina S. Kang-Yun et al, Evidence for methanobactin "Theft" and novel chalkophore production in methanotrophs: impact on methanotrophic-mediated methylmercury degradation,The ISME Journal(2021).DOI: 10.1038/s41396-021-01062-1
