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Oil & Gas

Petroleum product imports up 10 pct in 2018

8 May 2019

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Cambodia ,
Vietnam

Cambodia imported 2.5 million tonnes of petroleum products in 2018, a 10 percent year-on-year increase, according to the Ministry of Mines and Energy.

Diesel and gasoline are the most imported petroleum products, according to Sok Khavan, the ministry’s secretary of state, who spoke during a conference on the oil and gas sectors held at Phnom Penh’s Sokha Hotel yesterday.

Imports came from Singapore, Thailand, and Vietnam, Mr Khavan said, adding that currently 15 local and international oil companies import petroleum products from abroad.

These companies distribute the products to consumers through 3,778 petrol stations and 29 petroleum terminals nationwide. 103 of these are liquefied petroleum gas (LPG) stations, according to Mr Khavan.

“The government has opened the market, allowing the private sector and development partners to participate in the investment, exploration, production, refining, import-export, storage, transportation and distribution of petroleum and petroleum products,” pointed out Mr Khavan.

“Now, for upstream we have Block A, which is under development. Production is forthcoming. We have several other blocks under negotiation and four areas in the overlapping claims area,” he said, adding that most exploration activities are offshore, with onshore options relatively unexplored.

“We strongly believe that our onshore holds an exciting prospect for further exploration,” Mr Khavan added.

According to a study from the Economic Research Institute for Asean and East Asia (ERIA), from 2012 to 2016, demand for petroleum products grew by an average of 7.2 percent a year, which, according to the authors, is a very high growth rate compared to the region and other parts of the world.

Shigeru Kimura, ERIA special advisor on energy affairs, said that petroleum demand in Cambodia was 1.9 MTOE (one million tonne of oil equivalent) in 2015, and will increase to 4.8 MTOE by 2040.

He said that from 2015 to 2040 LPG is likely to experience the highest hike in demand, followed by gasoline, jet fuel, and diesel oil.

Cambodia expects to draw its first drop of crude oil later this year.

Oil will be extracted from the Apsara oilfield, which is located in Block A of the Khmer Basin in the Gulf of Thailand and has been identified as the first productive oil field to be brought online in Cambodia.

Oil & Gas

SK Innovation discovers new oilfield in Vietnam

8 May 2019

–

Vietnam

SK Innovation has discovered a new oilfield in the Cuu Long basin located in southeastern Vietnam, the company said, Friday.

The energy business arm of SK Group said its exploration team found a 116-meter-thick oil layer after drilling 4,295 meters in Block 15-1/05 in Lac Da Trang in the basin.

Further analysis will be required to figure out the size of the oil discovery and whether it is commercially viable.

Block 15-1/05 is adjacent to Block 15-1 in the same basin, where SK Innovation initiated its commercial oil production in 2003.

In February 2007, SK Innovation signed an extraction contract with the Vietnamese government for Block 15-1/05.

In 2015, SK Innovation confirmed that the block had enough oil reserves in Lac Da Vang near Lac Da Trang for commercialization after producing up to 2,450 barrels per day during tests.

The Lac Da Vang development team then announced its plan to commercialize the oil field in January, 2018 and production is expected to take place in 2021.

The company holds a 25 percent stake in Block 15-1/05 while U.S. crude oil producer Murphy has 40 percent and Vietnam’s state-owned oil firm PVEP holds 35 percent.

“Vietnam is one of the most important countries for us, and we are actively implementing exploration and production activities there,” a SK Innovation official said.

“We aim to strengthen ties with the Vietnamese government and PVEP to become the largest foreign refiner in the Cuu Long basin,” he said.

As of the end of 2018, the company produces about 53,000 barrels of crude oil and natural gas per day from 13 oil and gas fields in nine countries and through four LNG projects.

Energy Economy

Electricity and petrol price hikes pushing inflation up

8 May 2019

–

Vietnam

According to latest statistics released by GSO, Vietnam’s CPI in April increased by 0.31 percent over the previous month, while average CPI in the first 4 months increased by 2.71 percent compared to the same period in 2018.

“The increase in petrol and electricity prices have had a direct impact on increasing the consumer price index in the month,” a GSO report said

Specifically, this contributed to an overall increase of 0.41 percent in the CPI. Out of the 9 group of goods that saw increased prices in the CPI basket, transportation costs rose the most, by 4.29 percent.

Professor Pham The Anh, an economist and co-founder of the Vietnam Institute for Economic and Policy Research (VEPR), said that the inflation rate will continue to rise in the coming months.

“The decision to raise environmental protection taxes on petrol, rising world oil prices and the recent increase in electricity prices by 8.36 percent all occurred in the first three months,” he noted.

“These adjustments often do not immediately affect the inflation rate within the quarter, but may even last up to one year, with the strongest impact kicking in by the third or fourth month,” Anh said.

Since the beginning of the year, gasoline prices have increased by nearly VND5,000 (21 cents) per litre for both E5RON92 and RON95 gasoline, the two types mostly used in Vietnam.

This represented a rise of around 30 percent for both types of gasoline, which now cost VND20,688 (89 cents) per liter for E5RON92, and VND22,191 (95 cents) per litre for RON95.

Nguyen Van Quyen, chairman of the Vietnam Automobile Transport Association (VATA), said the sharp increase in gasoline prices will affect transport enterprises, because the fuel accounts for on average 35-40 percent of transportation costs.

“Nobody wants petrol prices to go up, but local prices are dependent on global prices. Enterprises do not react immediately to fluctuations, but if prices are forecast to remain high over 3-6 months, they are likely to respond,” he said, speaking to local press.

Electricity prices also rose 8.36 percent in March as a result of rising production costs and higher coal imports. This was the first increase in two years.

However, many households were hit hard as electricity use doubled in April as a result of unusually hot weather. Many families turned on their air conditioners for long periods, causing electricity bills to soar, according to Nguyen Duy Quoc Viet, deputy general director of state-owned Vietnam Electricity HCMC.

According to VEPR, these price increases will also put serious pressure on costs in the manufacturing sector.

“Achieving the State Bank’s (SBV) 4-percent inflation target for the year will not be an easy task. To monitor inflation risks, the SBV needs to be careful with managing the money supply and credit growth in the coming time,” it said.

Renewables

Keppel O&M makes offshore wind comeback with convertor station deal

8 May 2019

–

Singapore

A consortium comprising Keppel Offshore & Marine’s subsidiary Keppel FELS Limited and Aibel in Norway secured the contract from TenneT Offshore GmbH, the grid operator in the Netherlands and Germany, for the design, engineering, procurement, construction, installation and commissioning of a 900-MW offshore high-voltage direct-current converter station and an onshore converter station.

Together with subcontractor ABB the consortium will also undertake the installation and start-up operations of the offshore and onshore converter stations on site in Germany.

Scheduled to be completed in 2024, the converter stations will be part of the DolWin cluster servicing offshore windfarms in the German sector of the North Sea. The offshore converter station will be located approximately 130 km from the onshore converter station.

Keppel O&M chief executive Chris Ong said, “This is Keppel O&M’s first major project of this scale and extends our track record in supporting the renewable energy industry. We see opportunities in this segment as the offshore renewables market is expected to increase significantly.”

The offshore converter station is a 900-MW gravity-based structure based on Aibel’s patented design and will be equipped with living quarters, a helideck and cranes. When completed, it will receive power from three offshore windfarms and convert high-voltage alternating current to high-voltage direct current before sending it to the onshore converter station via subsea cables. The onshore converter station will then convert the HVDC back to HVAC and transmit to the grid.

TenneT chief executive Tim Meyerjürgens said, “With DolWin5 we are opening a new chapter in offshore grid connection technology. For the first time we will realise a direct connection between the wind turbines and TenneT’s offshore platform without any further substations.”

Oil & Gas

LNG, a fuel for the future? Not everyone agrees

8 May 2019

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Singapore

IN A significant milestone in the journey towards routine LNG (liquified natural gas) bunkering in Singapore, Pavilion Energy has performed the first commercial ship-to-ship LNG bunkering. In the operation 2,000 cubic metres of LNG was loaded on to a dedicated LNG bunker tanker at the newly-modified Secondary Jetty of the Singapore LNG (SLNG) Terminal, followed by a ship-to-ship transfer to the receiving heavy-lift commercial vessel.

Maritime and Port Authority (MPA) Singapore’s chief executive Quah Ley Hoon said: “Pavilion Energy’s first commercial ship-to-ship LNG bunkering operations in Singapore demonstrates our strong commitment and capability to deliver a comprehensive suite of LNG bunker supply solutions to Singapore and the region.

“As the world’s largest bunkering port, Singapore is committed to providing a range of bunkering solutions to meet the future energy needs of the global shipping industry. We congratulate Pavilion Gas for completing this ship-to-ship LNG bunkering operation in the Port of Singapore safely, and look forward to more such activities taking place in our port.”

While the number of ships using LNG as fuel is still very small, more major owners are moving towards ordering LNG-capable ships. This is partly driven by the impending International Maritime Organization (IMO) 0.5 per cent cap on sulphur in fuel. Burning LNG is an effective way of complying with this regulation, which takes effect in January 2020; burning it also avoids emitting various other pollutants.

Renewables

More hydropower projects under way in Myintnge Basin

7 May 2019

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Myanmar

Eight hydropower projects with an installed capacity of 2,615 MW will be developed in Myintnge Basin, according to the Ministry of Health and Sports.

Upon completion, these projects can generate 11,652 million kilowatt hours every year.

The projects cover the dam system project and the diversion and low-dam system which may have the least environmental and social impacts. The step-by-step implementation of projects along the river aims to control water quality degradation and the deterioration of ecosystem.

Now Yeywa hydropower project on Myitnge River has an installed capacity of 790 MW and can produce 3,550 million kilowatt hours a year. This project will distribute its power to the national power grids through 230-KV Yeywa-Baelin power lines and 230-KV Yeywa-Meiktila.

Nanmatu (Thibaw) hydropower project will produce 210 MW, Middle Yeywa hydropower project, 735 MW and Deedoke Yeywa hydropower project, 60 MW.

Currently, most of the regions including Yangon are facing power blackouts. There is widespread criticism among the public over the frequent power blackouts.

Power production by hydropower plants has declined as the water levels continue to decline in the dams. Efforts are being made to produce more power from gas-fired power plants in order to satisfy power demands. The ministry will report load shedding plans to relevant region and state government and needs to try to have the least impacts on the public if the ministry has to carry out load shedding, said Union Minister for Electricity and Energy Win Khaing.

Electricity/Power Grid

Power production declines by over 250 MW in four months

7 May 2019

–

Myanmar

Within four months, the country’s highest power production output has declined by over 250 MW, according to the figures from the Ministry of Electricity and Energy.

The highest power production was 3,303.9 MW on January 7 this year. The ministry produced 3,078 MW on May 5, down 255.9 MW.

Yangon Region consumes 1,282 MW or 41 per cent of the total power consumption, Mandalay Region, 516.2 MW or over 16 per cent, Nay Pyi Taw Council Area, 161 MW or five per cent and other regions and states, 1,214.7 MW or over 39 per cent.

The current power production is about 3,800 MW. Plan is under way to produce an additional 3,000 MW in the next three years, said Union Minister for Electricity and Energy on March 16.

Under the National Electricity Plan (NEP), Myanmar has set a goal of electrifying the whole country by 2030.

Electricity/Power Grid

Sarawak to spend RM5.1b on water, electricity over two years, says state minister

7 May 2019

–

Malaysia

KUCHING, May 7 — Sarawak’s Ministry of Utilities has been allocated RM5.1 billion to carry out water and electricity supply projects over the next two years, its minister Datuk Seri Stephen Rundi said today.

He said the state government is committed to achieving maximum coverage for water and electricity supply by the year 2025.

Rundi said RM2.8 billion out of RM5.1 billion is allocated for the first phase of the Sarawak water supply grid programmes.

“The first phase includes water treatment plants, pipelines, reservoirs and booster stations which are required to effectively resolve immediate water supply issues,” he told reporters after the winding-up debate in the Sarawak State Assembly here.

He said these projects, when completed, will increase the treatment capacities and volume of water delivered, and improve the water pressure in stressed areas where ageing pipes have burst and at over-capacity treatment plants.

Rundi said 49 projects under the first phase have been completed and commissioned while 142 others are under construction, with a total cost of RM2 billion.

He said under the first phase, his ministry has targeted to implement 324 water supply projects.

Rundi explained all these water projects are state-funded as the state government cannot rely on the federal government for funds.

He said the waiting time for funds has been “too long” since the days of the Barisan Nasional (BN) government.

“With all these uncertainties, what choices do we have? We have to come up with our own money. The people down there are screaming for water so we have to carry out our responsibilities.

“Here, we are praying for things to come. Never come,” he said, before adding: “Since the state government has the resources, why not make use of it.”

On electricity supply, he said two generator units of 312 megawatts (mw) each at Balingian coal plant will be commissioned in the second and third quarters of this year.

“In addition, the 842mw Tanjung Kidurong gas plant will be commissioned in 2021,” he said.

He said Sarawak’s present installed grid generating capacity is about 4,600mw, most of which come from Bakun, Murum and Batang Ai dams.

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