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| BIOFUELS: Continental Airlines, Boeing and GE Aviation to use biofuels as aviation fuel |
| Monday, 07 April 2008 | |
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(EnergyAsia, April 7, Monday) --- Continental Airlines, Boeing and GE Aviation are planning to conduct a joint biofuels demonstration flight in the first half of 2009 to identify sustainable fuel solutions for the aviation industry. Continental is the first major US carrier to announce plans to highlight technological advancements in sustainable biofuels that can help to further reduce carbon emissions. “Boeing and GE Aviation have been frontrunners in pioneering technology that will benefit the aviation industry, customers, and the environment, and we are pleased to benefit from their expertise in this venture.” Ray Conner, executive vice president, sales, Boeing Commercial Airplanes, said: “Continental has been aggressively pursuing efforts to reduce carbon emissions for years, and continues to focus attention on providing innovative solutions. They clearly recognise the need for environmental improvement across the industry and have embraced that challenge through fleet modernisation and the economic and social benefits that sustainable environmental technologies can provide to their operations and to their passengers.” Scott Donnelly, president and CEO of GE Aviation, said: “Continental is taking an important step in advancing the use of sustainable biofuels in aviation. Working with our jet engine team at CFM International, GE has considerable experience in evaluating biofuels in jet engines for aviation and in aeroderivative engines for marine and industrial applications. GE and CFM are eager to get started in supporting Continental’s exciting program.” The biofuel flight will use a Boeing Next-Generation 737 equipped with CFM International CFM56-7B engines. CFM is an equal joint venture company of General Electric Company and Snecma (SAFRAN Group). In the months leading up to the flight, Continental, Boeing and GE will work together and with an undisclosed fuel provider to identify sustainable fuel sources that don’t impact food crops, water resources or contribute to deforestation, and which can be produced in sufficient quantities to support a pre-flight test schedule that includes laboratory and ground-based jet engine performance testing to ensure compliance with stringent aviation fuel performance and safety requirements. As part of a broader industry effort, Boeing and other industry thought leaders, including airlines and engine manufacturers, are helping to guide the aviation sector toward sustainable biofuels produced through advanced biomass conversion technologies and processes that have the potential to reduce greenhouse gases throughout their lifecycle. Sustainable biofuels for aviation incorporate second-generation methodologies relative to fuel source selection and processing, which are uniquely suited for aerospace use. These biofuels can then be blended with kerosene fuel (jet-A) to reduce dependency on fossil fuels. Additional details, including the flight plan, will be announced closer to the demonstration flight date. Continental’s participation in this project is part of a company-wide commitment to environmental responsibility. The airline said it has achieved a 35% reduction in greenhouse gas emissions and fuel consumption per mainline revenue passenger mile flown over the past 10 years. This is due in large part to the efforts of its employees in streamlining operational procedures and to an investment of more than $12 billion to acquire 270 fuel-efficient aircraft and related equipment. Continental said it remains committed to investing in a fuel-efficient fleet and is a launch customer for the Boeing 787 Dreamliner, powered by GE engines. In addition to providing passengers with a better flying experience, the 787 Dreamliner also will provide operators with a more environmentally efficient jetliner, including lower carbon emissions and quieter takeoffs and landings. Continental said it has also reduced, by 75%, nitrogen oxide emissions from ground equipment at the carrier’s largest hub, in Houston, through switching to electric ground service equipment and other new technology. This technology is now being tested for use in cold climates. |
| RUSSIA: The Energy Charter Treaty, and what provisional application means |
| Monday, 07 April 2008 | |
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By Sophie Nappert *
Background (EnergyAsia, April 7, Monday) --- The policies adopted by the Russian Federation in dealing with its energy resources, notably in its gas pricing dispute with Ukraine and, more recently, its draft law on foreign investment in strategic industries , are the subject of worldwide publicity and comment. Russia has signed the Energy Charter Treaty (ECT), but to date has no intention of ratifying it. The advent of Dmitry Medvedev as President Putin’s successor later this year is not expected to herald a change in Russia’s stance on this matter. The continued non-ratification of the ECT by one of its key signatories, in geopolitical terms, places Russia in a unique position. This position will no doubt be tested in the arbitration proceedings started against Russia by Yukos’ majority shareholders Group Menatep, Hulley Enterprises, Yukos Universal and Veteran Petroleum Trust, for the alleged expropriation of their investment in Yukos. The Energy Charter Treaty The ECT is the first multilateral instrument aimed at promoting and protecting investment, security of supply and transit in the energy sector. It advocates transparency and non-discrimination in the treatment of foreign investment, freedom of transit and a commitment to the progressive liberalisation of international trade in the energy sector. Fifty-two states, including Ukraine and the EU as a unit, have signed the ECT and twenty more are observers. In addition to Russia, other signatory States which have not ratified the ECT are Australia, Belarus, Iceland and Norway. The effect of signature without ratification, in public international law terms, is that Russia is “provisionally applying” the ECT. Having signed the treaty places Russia under an obligation at international law not to act in a manner contrary to the ECT’s aims and terms. The ‘domestic exception’ clause in Article 45 A crucial aspect of Article 45 lies in its ‘domestic exception‘ clause, to the effect that provisional application must not be inconsistent with the signatory State’s constitution, laws or regulations. Russian law acknowledges and accepts the notion of the provisional application of treaties. The Constitution of the Russian Federation assigns to the President the right to negotiate and conclude international treaties pursuant to its Article 86(b), but leaves their ratification to the Federal Assembly (the State Duma and Council of the Federation: Articles 71, 105, 106(d)).
The concept of provisional application does not appear in Article 15(4) of the Constitution, whereby generally accepted principles and rules of international law and international treaties of the Russian Federation are made an integral part of the Russian legal system. However, Article 23 of the 1995 Federal Law on International treaties of the Russian Federation specifically recognises the provisional application by Russia of international treaties to which it is a party, if so provided by the treaty or by agreement with the other signatories. Time scope of provisional application: How provisional is ‘provisional’? There is little precedent on how provisional application affects the other substantive provisions of a treaty. This may be because provisional application is usually followed by ratification in fairly short order. As regards the ECT, a key issue is whether Article 45 affects the capacity of an investor to invoke the ECT’s dispute resolution provisions at Article 26 ECT against Russia. In other words, does provisional application shield Russia from investor-to-State arbitration pursuant to the ECT? This is one of the central issues in the pending arbitration proceedings against Russia concerning Yukos. Whilst this issue remains to be decided in the case of Russia, another tribunal in the recent case of Kardassopoulos v Georgia, faced with similar arguments on the part of Georgia, made the following findings: • Provisional application of the ECT is not aspirational in character; it is a matter of legal obligation. • It is the ECT as a whole and in its entirety which is to be applied ‘pending its entry into force’. • The language at Article 45(1) is to be interpreted as meaning that each signatory State is obliged, even before the ECT has formally entered into force in that State, to apply the whole ECT as if it had already done so. Another central question to Russia’s current stance under the ECT is whether the period of provisional application is limited in time or indefinite. No express limitation in time is stipulated in Article 45 ECT. According to Article 45, provisional application comes to an end either through express termination via written notification, or by the entry into force of the ECT. As things presently stand, it would appear that the provisional application of the ECT may be maintained indefinitely. *Sophie Nappert is a dual-qualified lawyer in the UK and in Canada, and a member of the International Centre for Dispute Resolution’s Energy Arbitrator’s List. She is an arbitrator in independent practice, based in London. Before becoming a full-time arbitrator, she was Head of International Arbitration at a global law firm. Sophie is trained and has practiced in both civil law and common law jurisdictions. In her capacity as counsel, she advised on issues of international arbitration, particularly in energy and infrastructure projects, and disputes involving state parties. In her capacity as arbitrator, she is sought for her trans-systemic and cross-cultural legal training and expertise. Sophie is ranked in Global Arbitration Review's Top 30 List of Female Arbitrators Worldwide. |
| CHINA: Lubrizol’s new Tianjin plant is key to10-year plan to meet demands of additive customers |
| Friday, 04 April 2008 | |
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(EnergyAsia, April 4, Friday) --- The Lubrizol Corporation has launched a 10-year phased investment plan to upgrade and increase global capacity in its additive business. This will be achieved through an extensive debottlenecking program at its existing facilities and a greenfield investment in China. By phasing in selective capacity additions in China, Lubrizol aims to respond to lubricant growth in Asia and better match its manufacturing footprint with global demand patterns. Debottlenecking and the China investment will require a $200 million investment over the next decade. This is in addition to Lubrizol Additives segment’s continued significant reinvestment in its existing operations and environmental compliance at roughly the rate of depreciation. Steve Kirk, Lubrizol Additives president, said: “We will invest over a billion dollars in the next decade to ensure we continue as the most reliable supplier to the fuels and lubricants industry. However, the appropriate phasing of new capacity over time is critical.” The Tianjin site is in phase three of the Industrial Park development plan and will be ready for construction in late 2009. The wholly owned capabilities will eventually include driveline and industrial additives blending, marine additives for export and a technical service laboratory. This new site is also expected to accommodate the relocation of the Tianjin Branch plant of the Lanzhou Lubrizol Lanlian Additive Co Ltd (LLZL) engine oil additive joint venture, which must be moved from its current location in Tianjin Tanggu due to a change in zoning. By sharing this site with the LLZL joint venture, Lubrizol believes both parties will achieve cost saving synergies, and the joint venture will benefit from doing more business with Lubrizol. NYSE-listed Lubrizol Corporation is a specialty chemical company that produces and supplies technologies that improve the quality and performance of our customers' products in the global transportation, industrial and consumer markets. These technologies include lubricant additives for engine oils, other transportation-related fluids and industrial lubricants, as well as fuel additives for gasoline and diesel fuel. In addition, Lubrizol makes ingredients and additives for personal care products and pharmaceuticals, specialty materials, including plastics technology and performance coatings in the form of specialty resins and additives. |
| AUSTRALIA: WorleyParsons to acquire INTEC Engineering from Heerema Group |
| Friday, 04 April 2008 | |
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(EnergyAsia, April 4, Friday) --- Australian engineering firm WorleyParsons is acquiring the Heerema Group’s INTEC Engineering BV division, a leading international deepwater and arctic engineering and project services company. The transaction will not affect projects under existing or pending contracts between INTEC and Heerema Group or third parties. Heerema and WorleyParsons are committed to a continued business relationship which is expected to be beneficial to clients. INTEC provides engineering services to the offshore exploration and production, and transportation sectors of the energy industry worldwide. Its technical expertise includes offshore field development, offshore pipelines, marine production risers, subsea and floating production systems, and flow assurance and operability. Heerema Group’s CFO, Nico Pronk, said: “This is a good outcome for both companies. In the past years, INTEC has made a significant contribution to Heerema’s services in the market for EPC (engineering, procurement and construction), particularly in the deepwater segment. WorleyParsons is the best fit for offering further growth and development of INTEC’s capability, combined with the global capability of the WorleyParsons organisation”. “Equally important is the continued access that WorleyParsons is offering Heerema to its resources, providing Heerema a competitive advantage in the current tight labor market. With access to this broader range of engineering and project management capacity, our Heerema Marine Contractors and Heerema Fabrication Group divisions will now be better positioned to capitalise on the opportunities in our industry.” WorleyParsons CEO, John Grill, said: “The world’s remaining oil reserves are increasingly being found in difficult to access areas, forcing our clients to look further afield in their search for new reserves. “The acquisition of INTEC completes the missing link in our hydrocarbons business which we have been seeking to fill for several years and strategically positions WorleyParsons to service our clients operating in deepwater locations. “INTEC’s capabilities uniquely complement the existing capabilities of the sea engineering business, a specialist in deepwater hull, moorings and risers, acquired in January 2007. WorleyParsons now has the capability to provide services across the entire spectrum from subsea to transmission line. We were attracted by INTEC’s experienced management team as well as its track record of profitable growth.” WorleyParsons and INTEC have a long track record working together on projects around the world. INTEC’s CEO, Edward Smith, said: “Joining WorleyParsons will benefit our staff through exciting new growth opportunities and benefit our clients through significantly enhanced and complementary technical and project management skills and geographic presence. “The additional resources our business will gain from being part of the WorleyParsons group will provide a platform for a truly diversified and comprehensive engineering and project services offering to the offshore industry.” Heerema Group is a group of companies operating worldwide specializing in design, project management, construction, fabrication, transportation, installation, and removal of offshore facilities for the oil and gas industry. WorleyParsons is a leading provider of professional services to the energy, resource and complex process industries. INTEC is a leading engineering and project management company with offices in Houston, London, Delft, Kuala Lumpur, Perth, Rio de Janeiro and Lagos serving the international oil and gas industry with over 500 employees. Its technical expertise includes offshore field development, offshore pipelines, marine production risers, subsea and floating production systems, and flow assurance and operability. |
| COMPANIES: Shell and Virent to work on jointly developing biogasoline from non-food crops |
| Thursday, 03 April 2008 | |
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(EnergyAsia, April 3, Thursday) --- Royal Dutch Shell and Virent Energy Systems Inc of Madison, Wisconsin in the US have announced a joint research and development effort to convert plant sugars directly into gasoline and gasoline blend components, rather than ethanol. Shell said the collaboration could herald the availability of new biofuels that can be used at high blend rates in standard gasoline engines. This could potentially eliminate the need for specialised infrastructure, new engine designs and blending equipment. Shell said these new ‘biogasoline’ molecules have higher energy content than ethanol (or butanol) and deliver better fuel efficiency. The major said: “They can be blended seamlessly to make conventional gasoline or combined with gasoline containing ethanol. “The sugars can be sourced from non-food sources like corn stover, switch grass, wheat straw and sugarcane pulp, in addition to conventional biofuel feedstock like wheat, corn and sugarcane. The companies have so far collaborated for one year on the research. The BioForming(TM) technology has advanced rapidly, exceeding milestones for yield, product composition, and cost. Future efforts will focus on further improving the technology and scaling it up for larger volume commercial production. “The technical properties of today’s biofuels pose some challenges to widespread adoption,” said Graeme Sweeney, Shell Executive Vice President Future Fuels and C02. “Fuel distribution infrastructure and vehicle engines are being modified to cope but new fuels on the horizon, such as Virent’s, with characteristics similar or even superior to gasoline and diesel, are very exciting.” Randy Cortright, Virent CTO, co-founder and executive vice president, said: “Virent has proven that sugars can be converted into the same hydrocarbon mixtures of today’s gasoline blends. Our products match petroleum gasoline in functionality and performance. “Virent’s unique catalytic process uses a variety of biomass-derived feedstocks to generate biogasoline at competitive costs. Our results to date fully justify accelerating commercialization of this technology.” Virent is a biofuels company commercialising an advanced biofuel technology to power today’s vehicles in place of fossil fuels. Its patented BioForming(TM) process converts biomass-derived feedstocks into conventional hydrocarbon fuels and products, including gasoline, diesel, and jet fuel. The process delivers more net energy and offers a scalable, cost-effective alternative to traditional biofuel production routes. Virent has 68 employees located in a state-of-the-art catalytic biorefining development facility in Madison city. The technology is based on the aqueous phase reforming process, which Virent has exclusively licensed from the Wisconsin Alumni Research Foundation. |
| MARKETS: OPEC attitude hardens towards the West as $100 oil becomes the new standard |
| Thursday, 03 April 2008 | |
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(EnergyAsia, April 3, Thursday) --- The courtship between the Middle East and Asia is starting to narrow down to a handful of partners. Not all Middle Eastern countries are rich or blessed with lots of oil, and not all Asian countries are dynamic and have bright economic prospects. The losers would include the smaller economies like the Philippines, Sri Lanka, Laos and Taiwan, which have to live with high oil prices, but receive little of the petrodollars by way of investments from the oil producers. Last month, the Philippines lost an ace investor in Saudi Aramco, which is divesting its 40% stake in Petron after 14 years with only modest results to show. Despite its credentials as the largest Muslim country in the world, Indonesia has been unable to court serious investment from Saudi Arabia and Kuwait. |
| CHINA: CEIP calls for breaking the Sino-US “suicide pact” on climate change |
| Wednesday, 02 April 2008 | |
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(EnergyAsia, April 2, Wednesday) --- The US and China must make accommodations to curb greenhouse gas emissions if both countries are to break their “suicide pact” of self-destructive, energy-using behaviour, said the Carnegie Endowment for International Peace. In a special report, “Breaking the Suicide Pact: U.S.-China Cooperation on Climate Change,” William Chandler, director of the Carnegie Energy and Climate Program, identifies practical, non treaty-based approaches both countries could take to cut their carbon dioxide emissions across economic sectors—with little financial impact. He argues that China and the US should work together to set individual, national goals and achieve them through domestically enforceable measures and international agreements that prevent either nation from taking advantage of steps taken by the other. His key recommendations for US-China cooperation include: • Eliminating subsidies that discourage energy efficiency. • Providing tax breaks for investment in efficiency and low-carbon energy and impose tax penalties on high-carbon energy. • Making climate cooperation integral to trade policy, such as jointly setting production standards to limit the energy used to manufacture exports. • Creating partnerships between Chinese provincial officials and leaders in US states on the forefront of climate change prevention to improve implementation of innovative energy policies. • Promoting market penetration of existing carbon emission reduction technologies and encourage development of new technologies by linking American laboratories more closely to Chinese markets to share research and development costs. • Encouraging banks in China to remove the regulatory cap on interest rates for energy-efficiency investments. “US–China collaboration poses no threat to the climate leadership of any region or nation or to global cooperation. It is a complement, not a challenge, to existing and planned emissions cap and trade systems. This act of mutual self-preservation would help the US and China to avert climate disaster and the eventual sanctions of other nations if they do not act, and lay the groundwork for successful global action,” said Mr Chandler. Mr Chandler has spent over 35 years working in energy and environmental policy and was a lead author for the Nobel Prize winning Intergovernmental Panel on Climate Change. He is president of Transition Energy, co-founder of DEED China, a joint venture building waste heat recovery power plants in China, co-founder of the Moscow-based Center for Energy Efficiency, and founder and former director of Advanced International Studies at the Joint Global Change Research Institute. The Carnegie Energy and Climate Program aims to provide leadership in global energy and climate policy. It integrates thinking on energy technology, environmental science, and political economy to reduce risks stemming from global change and competition for scarce resources. |
| COMPANIES: Webcast interviews on www.EnergyAsia.com |
| Tuesday, 01 April 2008 | |
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(EnergyAsia, April 1, Tuesday) --- EnergyAsia has launched a new service: a series of interviews with senior executives of companies involved in the energy business. For use of these copyright interviews, please contact
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| SINGAPORE: Oxford Princeton’s ‘Options Pricing and Applications’ on April 16 |
| Tuesday, 01 April 2008 | |
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(EnergyAsia, April 1, Tuesday) --- ‘Options Pricing and Applications’, a workshop offered by the Oxford Princeton Programme, will be held in Singapore on April 16. As options are a growing part of energy hedging and speculating, understanding how they work allow traders to make better choices. Mastering the basics through this course, delegates will learn how to use the fast-changing markets to their advantage to achieve the most out of their option positions. Topics covered include the impact of option deltas on profits and losses, effects of option gamma on price exposure, benefits and costs of time decay, market volatility and its effects, hedging techniques, combining options to create other options, characteristics of extrinsic (time) value, calculating option values, exercise styles and their impact, options on price spreads, and what pricing models do not measure. As part of Oxford Princeton’s blended learning package, PrincetonLive.com’s ‘Hedging with Futures and Options’ is recommended as a pre-classroom study. Delegates are advised to take the appropriate online study as close to the classroom date as possible to optimise the classroom experience. This class is suitable for all levels from trade support staff to senior management. This programme will cover the different energy commodities. For more information on this course and other courses offered, please contact This e-mail address is being protected from spam bots, you need JavaScript enabled to view it |
| SINGAPORE: Oxford Princeton’s ‘Fundamentals of Energy Options’ on April 15 |
| Monday, 31 March 2008 | |
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(EnergyAsia, March 31, Monday) --- ‘Fundamentals of Energy Options’, a workshop offered by the Oxford Princeton Programme, will be held in London on April 8 and Singapore on April 15. This full-day workshop which includes a trading simulation and a comprehensive review of the course, will cover premium valuation to advanced trading strategies on exchange traded options and energy commodities such as oil, gas and electricity. As part of Oxford Princeton’s blended learning package, PrincetonLive.com’s ‘Options Always Die’ is recommended as a pre-classroom study. Delegates are advised to take the appropriate online study as close to the classroom date as possible to optimise the classroom experience. This class is recommended for trade support staff, senior management, professionals who require the basics on futures terminology and trading and, as a refresher course for those who would like to sharpen their skills on futures terminology and trading. This programme will cover the different energy commodities which include oil, gas and electricity. Participants are required to complete Princeton Energy Programme’s ‘Fundamentals of Energy Futures’ before enrolling for ‘Fundamentals of Energy Options’. For more information on this course and other courses offered, please contact This e-mail address is being protected from spam bots, you need JavaScript enabled to view it . |
