Iraq may have twice as much oil as previously thought, says minister

Jabar Al-Luaibi said Iraq’s oil reserves may be double their current estimated level. (REUTERS)
Updated 29 March 2018
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Iraq may have twice as much oil as previously thought, says minister

LONDON: Iraq’s oil reserves may be double their current estimated level, according to the country’s oil minister, as OPEC’s second-largest producer invited tenders for the exploration of 11 oil and gas blocks in the country’s south and east.
Jabar Al-Luaibi made the prediction at an energy conference in Baghdad on Wednesday, Reuters reported, with his comments subsequently echoed by Adnan Al-Janabi, head of the Iraqi parliament’s oil and gas commission.
The doubling of the country’s proven reserves would see Iraq overtake Saudi Arabia to contend with Venezuela for the title of the country with the largest proven reserves.
The South American nation says it has just over 300 billion barrels worth of proven reserves, a claim met with skepticism by some market analysts, with much of its reserves consisting of hard-to-access heavy oil in the country’s Orinoco belt.
Iraq last year upgraded its reserve estimates to 153 billion barrels from their previous level of 143 billion.
The oil minister’s statement is more likely to relate to future possible increases in resources, rather than an immediate upgrade to current reserves, said Robin Mills, CEO of UAE-based Qamar Energy.
“I don’t think it has any impact on the short- or medium-term output from Iraq, but it does emphasize the tension between OPEC restraint and Iraq’s plans for production growth,” he said.
The country plans to boost crude production to more than 5 million barrels per day from the current level of 4.35 billion.
However Al-Luaibi insisted that it “definitely will not deviate from the overall decision of OPEC” when it comes to the possible extension of a deal between OPEC and other producers to cut production, due to expire at the end of the year, Reuters reported.
Speaking at the same event, OPEC Secretary-General Moham-med Barkindo told the conference that the bloc was seeking “very long-term” cooperation with non-OPEC producers.
His remarks follow comments earlier this week by Saudi Arabia’s Crown Prince Mohammed bin Salman that the Kingdom is in discussions with Russia to forge an unprecedented 10-20 year cooperation agreement, building on the success of 2016’s agreement between OPEC and non-OPEC producers to cut output to support oil prices.
Brent crude futures, which slumped below $30 a barrel in early 2016, have recovered as a result of the production cut agreement, trading at about $70 a barrel this week.
Barkindo told conference delegates in Baghdad that OPEC was evaluating the impact of the deal to determine the “appropriate action” when it expired at the end of this year.
“In addition to the 24 countries that came to sign the declaration of cooperation in November, we have six more producing countries who came to show solidarity,” he said.
Al-Luaibi said that several oil exporters have suggested a six-month extension to the deal, declining to name them.
Barkindo said that investment in the industry was increasing following the recovery in prices, but had yet to reach levels witnessed before prices began falling in late 2014.


‘Fuel of the future’ comes of age as Aramco opens first hydrogen filling station

Updated 17 June 2019
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‘Fuel of the future’ comes of age as Aramco opens first hydrogen filling station

  • Fatih Birol’s comments were a deliberate poke at those experts who think that the sheer logistics of hydrogen make it always an unlikely solution to global energy challenges
  • Birol’s article was followed by a report from the IEA that put some meat on the bones of the argument that hydrogen is key to solving problems such as global warming

DUBAI: Fatih Birol, executive director of the International Energy Agency, cracked a joke in the Financial Times a couple of weeks ago.
“Hydrogen is the fuel of the future, and it always will be,” he wrote about the fuel that many experts agree could hold the key to the world’s energy problems.
It was a deliberate poke at those experts who think that the sheer logistics of hydrogen — generation, storage, and transportation — make it always an unlikely solution to global energy challenges.
Birol’s article was followed by a report from the IEA that put some meat on the bones of the argument that hydrogen is key to solving such problems as global warming and environmental degradation.
“The world has an important opportunity to tap into hydrogen’s vast potential to become a critical part of a more sustainable and secure energy future … The world should not miss this unique chance to make hydrogen an important part of our clean and secure energy future,” the report said.
That argument will get a critical boost today, when Saudi Aramco, the biggest oil company in the world, opens its first hydrogen fueling station in Dhahran Techno Valley, in the heart of the Kingdom’s oil producing region.
Aramco has partnered with Air Products, a US company that has been a pioneer in the use of industrial gases, to produce a filling station for hydrogen-fueled vehicles.

 

It is very much a test. “The collected data during this pilot phase of the project will provide valuable information for the assessment of future applications of this emerging transport technology in the local environment,” Aramco said when the project was first announced.
But it is something Aramco has been investigating for a long time. Ahmed Al-Khowaiter, Aramco’s chef technology officer, said: “The use of hydrogen derived from oil or gas to power fuel cell electric vehicles represents an exciting opportunity to expand the use of oil in clean transport.”
Hydrogen — essentially what is left when you take the oxygen out of water — has been recognized as a potential fuel source for many decades. Motor manufacturers developed a hydrogen motor engine 50 years ago, but the ease and accessibility of hydrocarbon fuels — oil, gas and coal — made it uneconomic to develop this technology beyond the prototype stage.
Now, as the debate over the role of hydrocarbons in the global environmental balance has become ever more intense, some experts, including Birol and other influential parts of the thought-leadership establishment, believe hydrogen is the next Big Thing in global energy trends.
The World Economic Forum (WEF) said recently that “green” hydrogen offers a solution to the world energy challenge, and that is the problem the theoreticians are struggling with: Hydrogen is released naturally in the process of burning hydrocarbons, but it is self-defeating, in an environmental sense. if you have to burn oil, gas or coal to produce it.
On the other hand, renewable sources, like sun, wind and water, do not produce enough hydrogen to be practically or commercially viable, and not at the right times, when people actually need it.
But, as the WEF noted recently “low-cost green hydrogen is coming”, as technology advances mean the cost of renewable energy falls dramatically each year. The Middle East already has a very big and very cost-efficient program for solar energy generation.
The other challenges lay in how to store and transport hydrogen. It can be loaded onto a tanker like LNG, or pushed through pipelines, but it would require a huge investment to change current logistics systems — essentially designed for oil and LNG — to handle hydrogen.
Many countries, including Saudi Arabia, already have the infrastructure associated with oil and gas refining and petrochemicals production to be able to equip “hydrogen hubs,” as long as there is government will and commercial incentive to do so.
For the Kingdom, it looks like a no-brainer for the future. As Birol said: “So, hydrogen offers tantalising promises of cleaner industry and emissions-free power. Turning it into energy produces only water, not greenhouse gases. It’s also the most abundant element in the universe. What’s not to like?”

FACTOID

Technological advances mean low-cost ‘green’ hydrogen offers a solution to the world energy challenge, according to the World Economic Forum.