World non-renewable energy discussion

tphuang said:

More things to consider from hydrocarbon industry.

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Shale boom is over and we are likely at the peak of what America will be producing and the economics of shale fields are getting worse since the easily tappable projects are getting dry so they have to go to secondary locations which require higher prices to drill. Not great for profitability and other stuff. So, I think the era of low oil prices is over. What this means is the control of non-US oil will be more important going forward.

So, it's good that China has now normalized relations between Saudi Arabia and Iran. That's a good step forward.

What we are seeing is that China's shipborne import of Russian crude is hitting an all time high in March at 43 million barrels. When combined will pipeline oil, this will likely be a new high oil import from Russia. On the flip side, the discount is shrinking.

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Also, PetroChina & Sinopec are both buying Urals, which is leading to over 11 million barrels of Ural import.

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Also Indian competition is shrinking the discount on the ESPO crude imports.

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the independent refiners are celebrating big time

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I been saying this exact thing since 2014... At that time I gave it 10 years, looks like I was right on.

Alright so 98 bcm through pipeline and 100 million ton LNG by 2030.

1 million tonnes (LNG) = 48.7 Bcf* (gas) = 1.379 bcm (gas)​

that would be 138 bcm by LNG!
That would be quite the huge jump from where things are at. That would be a whole re-orientation of Russian energy trade to China actually. Either China is going to significant raise its NG consumption or it's looking to resell a lot of that imo. China has been hoarding LNG long contracts for the past little bit. If they can lock that up that, then they are controlling the natural gas trade.


This is basically the re-orientation of Russian energy economy from Europe to China.

The POS2 pipeline may never gets built

They said the same thing about the original Power of Siberia never getting built. Then they said the new Russian gas fields in Siberia would never be developed without precious US "technology" after 2014 Crimea sanctions. Yadayada. And yet, they finished building the pipeline to Chayandiskoye, and its extension to Kovyktinsokye just fine. The gas fields are expanding just fine and the gas delivery targets are being not only met but exceeded. Just last year, when Russia finished the extension to Kovyktinsokye, they inaugurated a 803km long pipeline stretch. China also finished building the connection under the Yangtze River to Shanghai of North-South pipeline. But few people in the West took notice of this news.

Piped natural gas from Russia costs half the price of LNG that China is currently importing from Australia and the US to supply Shanghai. Already, because of Western sanctions, China has been switching to cheaper Russian LNG. Chinese imports of US LNG dropped by 95% from February to April 2022 as US supplies are being sent to Europe instead.

As the North-South pipeline from Beijing to Shanghai enters operational use and natural gas supplies reach Shanghai the demand for Australian and US LNG in Southern China will collapse.



At the same time, gas demand in Northern China continues to increase as infrastructure for heating is being moved from coal to gas, in order to meet air quality goals in Northern Chinese cities.

Russia still has to build the pipeline extension from the gas fields in Sakhalin to China first. As for the larger pipeline through Mongolia, Soyuz Vostok aka "Eastern Brotherhood", the route for the pipeline is still being surveyed.

As for calling Russia "unreliable" as a supplier, they never cut contracted gas supply through the pipelines. The US had to blow up Nord Stream to stop direct Russian gas supply to Germany. As we speak, Russia is fighting a war in Ukraine, and yet they continue to push gas through the pipeline that passes through Ukraine. The US, in contrast, has a long history of using energy blackmail, they confiscated Venezuela's oil refineries in the US, and banned supply of parts and service to Venezuelan refineries and electric grid, at the same time they regularly intercept oil tankers passing through the Caribbean headed there to starve Venezuela out of distillates and gasoline. The US also cut oil supplies to Imperial Japan in the 1941 which was the cause for Japan invading the East Indies to capture oil supply for their economy.

So thoughts? China has suprassed Russia in many areas of nuclear techologny, but FAST reactors and the HALEU fuel that powers them is one of the few areas that Russia still has a lead in. Could be seeing alot more FAST reactors out of this deal.

Russia has a lead over China in many nuclear technologies. Uranium enrichment, fuel manufacture, naval reactors, fast reactors, lead cooled reactors, nuclear space propulsion. China has vast experience in building civilian commercial nuclear reactors, probably the largest in the world, and they have basically all types of liquid water reactor in service. They also have a lead over Russia in pebble bed reactors.

China needs fast reactor technology so they can close the fuel cycle. China's energy needs are gargantuan, so they need fast reactors. India, which lacks natural uranium resources, is another country which should have been investing in fast reactor technology already.

interesting charts here of how much crude Chinese refineries processed in Jan/Feb (14.42m bpd)and exported 340k bpd of jet fuel, 574k bpd of diesel

To me, the big issue here is that they are still not utilizing their refineries enough. they need to ramp up that utilization about 80% and produce more petrochemicals, crude, diesel/gasoline. It's just wasteful to have refineries that sit idle.

I heard the sanction on North Korea has ended. Has there been attempt to address the energy shortage in North Korea?

more here. CNOOC and Shell signed agreement for another large Ethylene project in China

CNOOC, Shell project to build 1.6 million tons/ethylene cracking plant and a total of 18 sets of downstream chemical equipment and supporting public works

This is some huge refinery + chemical expansion going on in China.

Saudis are getting into China's teapot refineries to firm up demand since they want these refineries to buy Saudi oil

tphuang said:

https://twitter.com/i/web/status/1640344634080493568

more here. CNOOC and Shell signed agreement for another large Ethylene project in China

CNOOC, Shell project to build 1.6 million tons/ethylene cracking plant and a total of 18 sets of downstream chemical equipment and supporting public works

This is some huge refinery + chemical expansion going on in China.

https://twitter.com/i/web/status/1640286306432425984

Saudis are getting into China's teapot refineries to firm up demand since they want these refineries to buy Saudi oil

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More on this. It's a very big deal for Saudi Aramco to be able to secure 700k bpd of long term oil supply deal in the face of low cost Russian/Iranian oil competition. Again, I'm curious if this will allow them to use SHPGX and RMB. Nothing is confirmed, but settlement in Yuan is one of the rumors out of China. It seems like the Saudis have to give Chinese oil industry something to secure supply. I believe more long term contracts and investment deals from Saudis are coming.

Keep in mind that the Saudi banks did that CNY loan recently and it is buying RongSheng in RMB, so it has some RMB and will need some more RMB to pay for these investment.