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Improving Oil and Gas Efficiency Through Digital

oil-gas-banner.jpgOperational efficiency is the latest goal for the oil and gas industry. The sector is under immense pressure to become more efficient due to the continued fall of oil prices and subsequent tighter profit margins.

As the oil and gas sector continues to fluctuate economically, the operations have remained pretty much the same. This means that in order to achieve a better level of efficiency, industry members are going to have to take a step back and consider a completely new operations model. This is the only way to make a real difference to production performance.

It is believed that the solution to this conundrum lies with Digital – a term which includes the factors that make up the Internet of Things (IoT). These factors are data, machines and people and the confluence of these areas will have a positive effect on production efficiency. Indeed, the IoT will be able to boost throughput, improve field recovery and create better asset reliability.

It is clear that oil and gas leaders need to effect a fundamental change in how they operate and what kind of strategy they implement in order to really take advantage of digitisation. There are a number of trends being seen in the tech world, such as robotics and sensors, which can help improve field automation in a way that is pervasive.

From discussions with clients whose companies were successful in their drive for better operational efficiency through technology, we can see that they applied the following:

  • Common Standards: When operational technology and information technology meet, it is vital that there is in place a set of shared standards. These standards must adhere to strict operational requirements but must still allow information to be shared across the company.
  • Collaboration: In order to make sure the digitisation and integration of a company goes as smooth as possible it is essential to collaborate information. This means there must be multidisciplinary knowledge between information technology, data management, operational technology, cybersecurity and process design.
  • Self Funding and Adaptability: By keeping an eye open for potential brownfield sites that could be used for projects companies are able to deploy digital technology. This increases the thrust of the organisation and prevents any hesitation when it comes to adopting new technologies.
  • Security and Compliance: It is crucial that assets are protected, especially as we are now in an age where they are increasingly linked to the network. The digital infrastructure of a company must be closely monitored to protect it from cyber attacks. Threats must be taken seriously and any vulnerabilities must be addressed. There should be a general culture of security awareness within the company.

Oil and gas companies that revamp their operations to account for new technologies will stay ahead of the game. Much of what is being developed now in terms of technology is not only going to help oil and gas companies become more efficient, but it is going to completely change the game. This is the way oil and gas companies can become the winners of tomorrow.

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UK Won’t Allow Sanctioned Russian Gas to Enter Grid

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On Thursday night a shipment of Russian gas arrived at the terminal on the Isle of Grain. This came as Britain suffered its coldest temperatures of 2017 – a factor that has led to an increased demand for energy to keep homes warm. It seemed like the arrival of this tanker was a propaganda coup for Russia’s leader Vladimir Putin as it came accompanied by tweets from the Russian embassy in London saying, “Feeing cold? Help is on the way”.

 

However, it has since been revealed that this is likely to be fake news. It is much more likely that the gas shipment arrived and was offloaded into a storage facility in the UK only to be held for a while before being transferred to a different tanker and shipped off somewhere else in the world.

 

A source in the know regarding the operations of the National Grid on the Isle of Grain has assured us that the gas has not and will not enter the UK domestic gas network.

 

The shipment apparently came from Russia’s new liquefied natural gas facility in the Arctic Circle, Yamal. The first destination of LNG shipments from this facility has been under close inspection from energy traders and political analysts alike. The fact that it made its way to the UK seemed like a clear sign of the UK’s dependence on imported gas. The decline in North Sea reserves has caused the nation’s energy security to weaken – a temporary shutdown of one of the most important North Sea pipelines has contributed to this problem.

 

However, the fact that this shipment has not entered the UK’s grid means that it must have adequate supplies coming in from elsewhere. National Grid has denied a lack of energy security, claiming that there was no shortage of gas. Indeed, the lower demand from businesses that have closed over Christmas has offset the increased demand from households.

 

Gas prices in the UK spiked in December when the Forties pipeline in the North Sea closed to have its crack fixed but this increase has now reverted back to normal. The pipeline is nearly back to full functionality and expects to be there by early 2018.

 

Shale gas companies in Britain were hoping to use the Yamal shipment to press fracking. Before it was revealed that the shipment was destined for other parts of the world, the trade group for onshore oil and gas producers, UKOOG, publicly stated that Britain already imported half of its energy supplies. They then said that this statistic could increase to 80% dependency on foreign energy by 2035.

 

In an industry where the seller has complete control, this dependency could be a problem for the UK as it would leave it vulnerable to the whim of other governments with regards to political and economic interests. Ken Cronin, chief executive of UKOOG said “surely it is better for our economy and our environment that instead of relying on others we produce the gas from underneath our feet.”

OECD: Canada lags behind other countries for environmental taxes

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It might be the friendliest nation on earth but when it comes to saving the environment, Canada is lagging behind other countries. Currently Canada is at the bottom of the list of countries that are taxing pollution but the Organization for Economic Development and Co-operation (OECD) hopes this will change as Ottawa steps up existing taxes and imposes more carbon levies.

The OECDs latest report stated quite clearly that a lot more needs to be done to discourage polluters in order to counter the growth in greenhouse gas emissions that have damaged the environment over the past 15 years. The oil and transport sectors are two of the main offenders.

Canada has been advised by the OECD that it must “reduce drastically the carbon intensity of its energy production, particularly in the oil-sands industry,” in order to achieve its climate change goals.

In 2014 only Mexico and the United States ranked lower than Canada in terms of environmental taxes out of 35 member countries. Some measures that are being implemented include taxes on gasoline, tipping fees at landfills and water charges. Although some provinces have put in place a range of these levies, it has not been enough to have an effect on the country’s overall ranking.

Trudeau’s government is looking to pass legislation in 2018 that would affect provinces that do not have a pricing plan of their own. It would impose a carbon tax on them, which would rise to around $50 per tonne by 2022.

At the rate it is going, it looks like Canada is going to struggle to meet its goal of reducing emissions by 30% from 2005 to 2030. Nevertheless, the OECD has lauded Canada’s efforts to come back from the damage that was cause by Harper’s administration failing to implement any broadly based measures. However, it has also been noted that Canada needs to act soon if it wants to make any kind of difference before 2030.

There is a plan in play at the moment by the Liberal government, which involves carbon pricing and some serious investment in the development of new, clean technology. If this plan is strictly adhered to then there could be some real change in the pipeline for Canada, which is currently the fourth-largest emitter of greenhouse gases out of all of the OECD countries. On top of that, it is the second most carbon intensive country given the size of its economy.

The biggest challenge for Canada is going to be curbing the emissions from its oil industry, as these are responsible for about 25% of its greenhouse gas emissions. But, the oil industry is playing its part and has already stated that it is working to reduce these emissions. What’s more, the government has allocated around $440 million from its expected carbon taxes to help the oil industry become cleaner.

One of the incentives that is hoped to soon be in place is a special price break for industry leaders who significantly cut down emissions. This would make being clean more economical for oil producers.

The USA Might Not Ever Withdraw From the Paris Deal

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When Donald Trump announced to the world that he would be taking the United States out of the Paris Deal, the assumption was that he would actually do that. But, it seems that things haven’t been going entirely to plan based on what was seen at the Bonn summit. The negotiators in charge of sealing an agreement did not seem to be making the dramatic withdrawal he promised.

 

The Paris Climate Agreement (Paris Deal) was signed in 2015 and laid down goals that signatories should implement into their own national policies with regards to tackling climate change. For a number of reasons, these policies did not appeal to the President of the United States and so he decided to withdrawn his country from the agreement.

 

Judith Garber, the U.S. Acting Assistant Secretary of State for International Environmental and Scientific Affairs attended the Bonn summit. During her time there she told other delegates that the United States does not want to completely exclude the possibility of being involved in the global fight against climate change.

 

Indeed, she said that the nation wishes to continue to be engaged with other countries around the world in order to help move towards a cleaner future. She proceeded by reeling off a list of actions that the United States is undertaking in order to further the battle against climate change.

 

However, she tempered her positive speech by reminded the cohort that President Trump’s views on the Paris Agreement have no changed and that his position is entrenched. Nevertheless, she indicated that while he wants to withdraw from the deal as soon as he can, there is nothing stopping him from joining back up again in the future if terms that are more favourable to the American public can be agreed upon.

 

The general consensus by the time Garber had finished was that it may well be the case that re-joining won’t be necessary. This could be the case because the United States might not ever leave to begin with.

 

It was noticed by onlookers that Donald Trump’s decision to withdraw from the Paris Deal was undermined somewhat by his choice of methods as to how to execute his decision. He could have declared the original entry into the deal to be invalid because Obama did not allow Congress to be part of the decision. This would have allowed the President to withdraw straight away.

 

What President Trump has done instead has been to go down the official withdrawal route. This process will take over three years and won’t actually be triggered until the day after the next presidential election in the United States. This won’t be until 2020. So, the United States looks like it is going to be locked into this deal for, at least, another six years.

 

During this time, Trump will continue to send delegates to meetings. A State Department official said that this is in order to “ensure a level playing field that benefits and protects U.S. interests.”

 

Costa Rica Beat Former Record By Using Renewables for 300 Days

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Costa Rica is setting the bar high for renewable energy use with its new record of 300 days.

 

The Central American country has managed to run on renewable energy for 300 days so far this year, beating its previous records of 299 days in 2015 and 271 days in 2016.

 

The Costa Rican Institute of Electricity (ICE) claims that the country has run exclusively off of power that has been generated by five different renewable energy sources. These sources are hydropower, wind, geothermal, biomass and solar.

 

Hydropower contributes the largest portion of Costa Rica’s energy as the country sees a large volume of rain annually. The reliability of the rain – due to the presence of the rainforest – drives hydropower generation and allows Costa Rica to become more and more dependent on renewables.

 

Yet, hydropower is just one cog in Costa Rica’s renewable power generation machine. It is predicted that 2017 is going to be a good year for wind production in the country. Indeed, it could well be the year Costa Rica produces the most ever wind power. Currently there are sixteen wind farms across the country, which are producing a cumulative total of 1,014.82 gigawatt hours.

 

With each of these renewable sources doing their bit, it is likely that Costa Rica could actually go beyond their 300 day mark before the end of the year.

 

But, this isn’t the only step Costa Rica is taking to improve the country’s sustainability. Their commitment also includes an ambitious but promising target of becoming completely carbon neutral by 2021. This would be an incredible achievement for the country, particularly in light of the recent, revamped drive towards environmental sustainability and clean energy from global leaders.

 

Costa Rica’s other goal is to completely eliminate the use of single-use plastics. Finally, the nation has made it clear they are going to work on expanding their forest cover.

 

Costa Rica is home to huge swathes of tropical rainforest, which are in danger of rapid deforestation among other threats. It is therefore pivotal that the country puts in a serious effort to protect its natural habitats and conserve its staggering biodiversity.

 

All that remains to be seen now is how Costa Rica will fare for the rest of the year and whether or not the country can maintain its excellent record for years to come. Whatever the outcome, Costa Rica is pioneering the way to 100% dependence on renewables and is setting a good example for other countries to follow suit.

Energy Shortfalls

powerlines_6.jpgReuters is reporting today (Dec. 1, 17) that Sweden will need an additional 2.6GW of power generation capacity by 2040 if production capacity is to keep up with demand. This is due, largely in part, to the planned shutdown of some of Sweden’s nuclear plants.

Germany, too, has been faced with a daunting task of providing energy during their total transition away from nuclear power which was sped up after the 2011 nuclear incident in Fukushima, Japan. Germany’s rather unfortunate solution has been to restart, and even construct new coal-fired power plants; significantly increasing Germany’s carbon footprint.

Sweden and Germany are not alone. Already mentioned, Japan has had to take drastic measures in power supply to be able to maintain a relatively stable network since most of its nuclear power plants remain offline.

Using renewables may seem like a great idea to help combat the gaps left by nuclear, but there isn’t enough capacity in place to provide a full replacement. What’s more, many sources of renewable energy are weather-dependent or dependent on other uncontrollable environmental factors.

While individual countries alone assess their power needs and make the decisions on the future of nuclear energy, they are often not alone in solving the problems faced by decommissioning. Efforts have been underway for many years already to connect grids with one another, creating a continent-wide super-grid capable of making the most use of available (renewable) power resources. With sufficient interconnection Sweden would be able to benefit from a solar power plant in Spain, or wind farms closer to home in Denmark and Germany, when their plants are able to produce more than can immediately be consumed domestically.

In short, though there is a looming shortfall which we cannot deny; there is a will and a means to help mitigate the effects and help boost renewable energy production.

Who are the large players in the energy industry?

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Where would the world be without energy? You certainly would not be reading this article right now. From the production and supply of electricity to jet fuel and heating oil, our lives depend on energy. So too, do we depend on the companies that are responsible for supplying and providing that energy. When we think of an energy company we often include our utility company, but also the gas station and perhaps even the oil companies. The latter companies are known the world over because of their sheer size and the exposure they have in providing us with that crucial element; energy.

Below we take a look at some of the largest names in energy production, that is to say companies that are active in the he production and sale of energy, including fuel extraction, manufacturing, refining and distribution. The ranking has taken place based on market capital for these publicly traded companies. Most large energy companies are public in order to compete and thrive in the energy economy. That’s not to say that there are many larger, small energy companies that are still privately held; but the below list counts the giants.

Exxon Mobil

Based in the US and known for its Exxon, Mobil and Esso brands around the world, this energy behemoth is based in Irving Texas and generates more revenue than any other publicly held corporation in the world.

Royal Dutch Shell

The 6th largest company in the world by revenue, Royal Dutch Shell is an Anglo-Dutch corporation which was formed by the joining of Royal Dutch Petroleum and the Shell Transport and Trading Company. Headquartered in The Hague, the company’s registered office is in London.

Chevron

 

A US company takes spot 3 on the list, with chevron beating out France’s Total and Britain’s BP, though this is a highly contested spot. Headquartered in California, the company is one of the successor companies to Standard Oil, and is active in more than 180 countries and known aborad largely by the Texaco brand.