• Combustion Industry News

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      Patrick Lavery

      Combustion Industry News Editor

IPCC releases Climate Change 2014: Impacts, Adaptation, and Vulnerability report

The Intergovernmental Panel on Climate Change (IPCC) last week released a report entitled Climate Change 2014: Impacts, Adaptation, and Vulnerability, which sets out for each of nine world regions expected impacts of climate change and confidence levels associated with them, as well as the potential for reducing the impacts with means of adaptation. Impacts include altered hydrological systems, altered wildlife abundance, migratory patterns and behaviours, changes to crop yields (both positive and negative, but more often negative), and extreme weather events. Other impacts which have more uncertainty (though very likely to be negative on the whole) are economic impacts and human health impacts, for instance from heatwaves. In addition, impacts are likely to be greater on those who are more vulnerable economically or in terms of health. The report notes that planning for adaptation has already begun in many areas, but that future decisions on adaptation techniques will play a highly important role in the risks posed by the impacts. It also makes it clear that the world is already experiencing impacts, such as heatwaves in Europe, bushfires in Australia, and floods in Pakistan. Some of the projected future impacts are not expected to have adaptation measures available – for instance the high impact on the Great Barrier Reef.

ExxonMobil reports claim oil and gas assets will not be stranded by stringent emissions reductions policies

Around the same time as the IPCC report was released, ExxonMobil released two reports into the business impacts of climate change. They claimed, according to the Financial Times, that its untapped oil and gas assets would not be rendered unprofitable to develop (or ‘stranded’, as the term is) in the period up until 2040, using the rationale that governments would be unlikely to restrict hydrocarbon development in such a way, as it would conflict with other governmental objectives, such as energy supply. Put more starkly, the report appears to say that if some countries move away from fossil fuels, the demand from developing countries will make up the slack. Accordingly, the reports predicted that by 2040, fossil fuels would still contribute something like 75% of the world energy supply, in line with projections by other organisations, including the International Energy Agency. The ExxonMobil report stated it would be unlikely that the world will meet the target of limiting the global average temperature rise to 2 oC. Interestingly, the reports presented calculations suggesting a price of $US 200 (€146) per tonne of carbon would be necessary to achieve the emissions reductions of around 80% believed to be needed for the 2 oC target, whereas it expects a price of $US 80 (€58) to have been reached in developed countries by 2040, and $US 30 (€22) in developing countries. Prediction is a notoriously difficult art.

Ukrainian oil refinery ownership transferred to hands of Russian bank; Ukraine seeks to regain ownership

In a further energy-sector development related to the geo-political situation between Ukraine and Russia, Reuters has reported that an oil refinery in Odessa (not part of Crimea) has been transferred to the ownership of a Russian bank, after the Ukrainian company previously owning it, Vetek, failed to pay the loan it had taken out for its purchase. To make matters more complicated, Vetek is owned by Serhiy Kurchenko, an ally of the ousted Russia-aligned former Ukrainian president Viktor Yanukovich, suggesting either the non-payment was tactical, or, on the other hand, that Mr Kurchenko is in financial difficulty or unable to access funds. The Ukrainian government has announced its intention to try to return ownership of the plant, which has a capacity of 3.6 million tonnes/year, to Ukrainian hands. The plant is currently not operating.

Russia strengthening trade ties with Egypt as it seeks new Middle East relationships

In further Russian news, the Financial Times has reported on how the country is actively trying to build new relationships with Middle Eastern countries, after the decline of some of the countries it has traditionally had strong relationships with in the region. In doing so, it is capitalising on the colder relationships some Middle Eastern countries now have with the US. In recent months, Russia has been negotiating a wide-ranging trade deal with Egypt, including the supply of LNG to the country, amongst other commodities such as wheat. Such developments are sure to affect the future global energy picture.

US government to study methane emissions from shale gas production

The US government has launched a study of methane emissions from shale gas production, with a view to introducing legislation to curb such emissions by 2016. It is part of a broader plan to reduce methane emissions which also includes reducing emissions from landfills and dairy farms. At issue for shale gas are so-called fugitive emissions, which are released from wells and other equipment during extraction and production; some groups claim that they are higher than currently reported, potentially to the point where the total shale-gas process is more greenhouse gas intensive than coal. The White House has framed the study as being necessary to ensure that shale gas production is a cleaner alternative, so that the US can continue to benefit from its unconventional gas boom.  If the federal government was to introduce legislation to curb emissions, it may examine the legislation already introduced by the state of Colorado, which was passed last month.

GE produces new air-cooled 9HA gas turbine

GE has produced the first of its new air-cooled HA class turbines, with a 9HA (50 Hz) unit having been manufactured in GE’s factory in Belfort, France. The 397 MWe unit, which achieves a 61.5% efficiency at ISO conditions, will be transported to Greenville in the US state of South Carolina for 14 weeks of testing; the first commercial operation (of a higher capacity 470 MWe unit) is expected to begin in 2016. GE will also produce a 7HA unit, with six having already been ordered by Chubu Electric in Japan. The H series, which the HA units are based upon, began development in 1992, and first entered commercial operation in 2003.

Alstom wins contracts for gas-fired plant in Iraq and equipment supply for Maryland plant

Alstom has announced the winning of two major contracts involving thermal power plants, one in Iraq and one in the US. In a project worth around €400 million ($US 551 million), it is to design, build and commission the 740 MW Zubair gas-fired power plant, to be located near Basra in southern Iraq. The plant will be used to expand oil production in the surrounding oil fields, and the client is Eni Iraq. In the US, Alstom is to supply a steam tail package for Old Dominion Electric Cooperative’s gas-fired Wildcat Point Combined Cycle Power Plant in Cecil County, in the state of Maryland. The steam tail package combines a steam turbine generator with two heat recovery steam generator, enhancing efficiency. The plant is to have a capacity of 1,000 MW, is due to be commissioned by mid-2017, and will be ODEC’s first combined cycle plant. The contract is worth €75 million ($US 103 million) to Alstom.

Irish Bord Gáis to be bought by Centrica and partners

Ireland’s state-owned gas distribution company, Bord Gáis, is to be sold into private hands, with a consortium of Centrica (the owner of British Gas) and two private equity groups to buy it for €1.1 billion ($US 1.5 billion). The deal includes renewable power generation assets and the 445 MW Whitegate gas-fired power plant. According to the Financial Times, the consortium sees room for growth in Ireland, where a recovering economy is expected to consume more power. The Irish government had hoped to sell Bord Gáis for €1.4 billion.