Energy Industry Review - November 2018 by Energy Industry Review

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Electric vehicles between trend and utility

Daniel Lazar Senior Editor

the beginning of this year, when we made the decision to move to another At level with this publication, we thought we should pay greater attention to the energy sector, but without neglecting the oil and gas sector. It was a natural step, from an editorial point of view, towards the new trends felt globally on more rational consumption of energy resources and adapting them to the needs of all. Naturally, motor vehicles haven’t been bypassed by this decision to reduce the use of fossil resources, which are limited (but this is another discussion, because new fields are being discovered, not to mention the fact that there are areas of the globe that haven’t been studied in detail and could present pleasant surprises) and must be used in a responsible manner. Hybrid and electric vehicles haven’t appeared recently, but their promotion is increasingly insistent. Either out of curiosity, or to be fashionable, increasingly more Romanians have started to seek such vehicles and even purchase them, maybe also stimulated by the much more generous vouchers as value offered upon the acquisition of a new car. We have complained that we don’t have sufficient charging stations, but even here things move in parallel with the dynamics of sales. Of course, there are plenty of shortcomings relating to the driving range, but the legislation also seems to make the life of diesel engines increasingly difficult, some European cities radicalizing the message up to forbidding their use on their territory. Naturally, no one expects them to be stopped brutally and within a short time-horizon, because oil resources are still a sustainable means from an economic point of view and, why not admit it, even strategic.

What happens in Romania? The ‘Rabla Plus’ program and especially the amount of EUR 10,000 offered as subsidy for the acquisition of an electric vehicle has made increasingly more Romanians consider the acquisition of a vehicle with zero pollutant emissions. As the allocated budget is RON 45mln, a simple calculation shows that maximum 1,000 electric vehicles can be purchased through this program. What’s interesting is that those who want to access financing through ‘Rabla Plus’ don’t necessarily have to scrap a car, but they can go directly to the dealer and request the EUR 10,000 subsidy. Instead, those who have at home a car older than eight years and want to scrap it can add to the amount of EUR 10,000 another RON 6,500 obtained as a premium. Thus, an electric car can be by EUR 11,450 cheaper for the buyer. The subsidy is significant, being higher than in states such as Germany or France. But the car offer is not very varied. A simple verification of motor vehicles strictly electric on the domestic market shows that Romanians who want them have only ten models to choose from. The cheapest electric vehicle available this year has a price of EUR 25,838, which can take it, with the state subsidies, to only EUR 15,838 (Rabla Plus) or even EUR 14,400 if a car older than eight years is also scrapped. Based on this amount, the potential buyer receives a vehicle of small size, destined especially to urban areas, with a power of the electric propeller of 60 kW (82CP) and a range of 120-160km. Thus, the price is no longer a prohibitive factor in choosing an electric vehicle. It remains to be seen what happens in 2019... We will come back with an analysis including the current offer and prospects for this vehicle segment so much publicized lately. 3

Content A general view on the revised Offshore Law

After several promised and exceeded deadlines, the revised Offshore Law was adopted by the Romanian Chamber of Deputies in late October 2018 and enacted by the Romanian President on 12 November 2018. The Offshore Law is potentially one of the most debated pieces of legislation we have seen so far. The article focuses on the main relevant aspects of this document

New Network Code for gas transmission: A big step towards functionality

A new Network Code for Gas Transmission entered into force on 1 October 2018, bringing important changes at the level of principles compared to the last versions of the Code, being able to finally make applicable this norm and contribute to ensuring the functioning of a liberalized market. The Intelligent Energy Association in 2016 launched a country project called Starting over in the gas market with 10 steps, in order to build a real market and remove the pseudo market that is first of all detrimental to gas consumers.

Nanotechnology and energy production

In the energy sector, nanotechnology increases the portfolio of new technologies for the improvement of efficiency and sustainability of current processes, the most known for energy production, the contribution of nanotechnology being extraordinary. A solution to obtain this change would be to introduce nanotechnological processes working with materials which, at the previously defined nanoscale, can provide them with new properties. 4

Romaniaâ&#x20AC;&#x2122;s Presidency in the Energy Charter We are discussing extensively about the objectives of this international platform and about Romaniaâ&#x20AC;&#x2122;s objectives during this term, opportunities and consequences, with the President of the Energy Charter Conference - IulianRobert Tudorache, State Secretary in the Ministry of Energy.

32 Black Sea Oil & Gas signed the gas transmission contract for the MGD Project The Midia Gas Development (MGD) Project consists of 5 production wells (1 subsea well at Doina field and 4 platform wells at Ana field), a subsea gas production system over the Doina well which will be connected through an 18 km pipeline with a new unmanned production platform located over Ana field. A 126 km gas pipeline will link the Ana platform to the shore and to a new gas treatment plant. energyindustryreview.com

76 Lithium-ion battery market set to expand Lithium-ion batteries are designed to provide higher productivity and longer life expectancy than other batteries. Based on their application, the lithium-ion battery market is segmented into the automotive, consumer electronics, and industrial and grid energy segments.

Romgaz, 5 years on Bucharest Stock Exchange After five years since its listing on the Bucharest Stock Exchange, Romgaz - the largest gas producer and the main gas supplier in Romania, is on top of transactions, and the share price went up 15% compared to the offering price.

Robots taking over! The ‘hows’ and ‘whys’ of making our lives easier

Let’s see how exactly do offshore robots fit in the current and future oil and gas industry. Stationary robots or land, underwater and aerial drones are sometimes adopted and invested in as soon as they leave the assembly line with leaders in the Oil & Gas industry reporting significant business interest. In consequence, they expect an important change in the division of work tasks come 2022.

Key files of the Clean Energy for All Europeans package adopted

New rules on renewables, energy efficiency and the governance of the Energy Union have been signed off by the European Parliament on November 13 – an important step in enabling the European Union and its Member States to embrace the clean energy transition, follow up on the already adopted 2030 climate legislation and meet the Paris Agreement commitments.

Pollution in EU wreaking havoc on human health

92 PETEC 2018 Today, natural gas - considered an ideal partner for renewable energy generation in a future sustainable energy mix - provides one quarter of the EU’s energy demand. According to most forecasts, gas will continue to play a key role alongside renewables in helping to meet future energy requirements. In this context, technology seems to be the right ally in fighting climate change. 5

NEWS

POWERING THE MARINE INDUSTRY WITH ENERGY STORAGE SOLUTIONS

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Join us on Linkedin Petroleum Review Publisher: Lavinia Iancu

Business Development Manager: Marius Vladareanu Sales Manager: Valentin Matei Scientific Board: President: Prof. Niculae Napoleon Antonescu PhD Members: Prof. Lazar Avram PhD; Assoc. Prof. Marius Stan; Prof. Ionut Purica PhD; Alexandru Patruti PhD

eading global maritime technology company Kongsberg Maritime has selected Leclanché, one of the world’s leading storage solutions companies, as its battery partner and supplier of customised marine energy storage solutions. The partnership contributes to Kongsberg’s new generation of hybrid power solutions, which are set to deliver gamechanging efficiencies and reduce the environmental impact of transportation with cutting-edge autonomous and crewed vessel newbuilds. Leclanché’s batteries will be an integral part of Kongbserg’s hybrid solutions. Through the partnership, Leclanché will deliver one of the largest single marine battery system order to date for 9 vessels totalling 45MWh batteries. The systems will be built at Leclanché’s facility in Switzerland with the cells manufactured at Leclanché’s Willstätt facility in Germany. The first project to be jointly executed will be Yara Birkeland, the world’s first

autonomous and electric container vessel with zero emissions ordered by YARA, one of the world’s leading fertilizer companies and a provider of environmental solutions. Replacing 40,000 truck journeys a year, Yara Birkeland will eliminate NOx and CO2 emissions and improve road safety, whilst also reducing noise and dust emissions currently caused by trucks in a densely populated urban area. The second project relates to vessels known as Grimaldi Green 5th Generation (GG5G). Grimaldi is one of the world’s largest operators of Rollon/ Roll-off (Ro-Ro) and Roll-on/ Roll-off Passenger (Ro-Pax) vessels. The hybrid propulsion system delivered by Kongsberg includes supply and integration of shaft generators, frequency drives, energy management systems together with Leclanché battery systems. The GG5Gs will be the first in a new series of hybrid Ro-Ro vessels using fossil fuel during navigation, with batteries providing a peak-shaving function and electricity in port.

Senior Editor: Daniel Lazar Journalists: Adrian Stoica, Vlad-Adrian Iancu Digital Manager: Justin Iancu

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FPPG DEBATE: THE INTERDEPENDENCE BETWEEN RISKS AND TAXATION SPECIFIC TO THE OFFSHORE OIL AND GAS SECTOR

he energy sector in Romania has a significant development potential compared to other Member States of the European Union (EU). Black Sea discoveries and the onshore deep geological potential give our country the prospect of developing new significant gas reserves, natural gas being the most important type of primary energy in the Romanian economy. Deep offshore drilling has a major contribution to covering oil and gas demand in the future. Costs and risks related to these projects are high, investments are made in the long run and their viability is affected by oil price volatility. In order to understand the context and clarify the main issues related to the taxation regime, the Oil and Gas Employers’ Federation (FPPG) has organized a debate on interdependence

between risks and taxation specific to the offshore oil and gas sector, in October this year. The roundtable meeting was attended by representatives of the industry in Romania, Denmark, Norway and the UK to present and compare, in theory, the taxation regime applicable to offshore blocks in the four states. Presentations made by experts during the meeting have targeted strictly the technical aspects of the taxation methods applicable to the oil and gas industry. It should be noted that the Norwegian tax policies in force, for oil, make up a coherent system aimed to assign to the state a significant part of the investment risk and, at the same time, a significant share of the profit related to activities. The representative of Oil & Gas UK has pointed out the most important aspects of taxation throughout 50 years of exploitation of oil and gas resources on

the UK continental shelf. Being a mature basin, the British company has worked increasingly more to attract investments and to maximize the economic recovery. Also, the Oil and Gas Association in Denmark, through the voice of the Managing Director, has highlighted the way in which it plans to unlock the potential of the North Sea, taking into account the fact that the average of new field discoveries, measured during a decade, is declining. At the end of debates, the conclusions of the report ‘Risks, taxation, investment decisions in the offshore oil and gas sector. The Black Sea and Romania’ were presented. The firm conviction of the authors, Vasile Iuga and Radu Dudau, is that the development of the offshore gas sector is a historical opportunity for our country, with great economic, political and energy security benefits.

OMV PETROM TAKES OVER REPSOL’S INTEREST IN FOUR ONSHORE EXPLORATION BLOCKS

AMR approved the takeover by OMV Petrom of Repsol’s interest in four onshore exploration licenses. Following NAMR’s approval, OMV Petrom becomes sole titleholder and operator of the four exploration blocks V Baicoi, VI Targoviste, XII Pitesti and XIII Targu Jiu. The farm-out agreements for the four 8

blocks were concluded in 2013, OMV Petrom being the operator, with a 51% interest, while Repsol had the remaining 49% participation interest. In the 2nd quarter of 2018, Repsol notified OMV Petrom of its intention to exit the licenses and the parties reached an agreement, pending approval from the authorities. OMV Petrom SA will continue the ongoing projects and will

take over the pending commitments according to the concession agreement. The investments done under the Joint Operating Agreement amount to more than 200 million USD until today, including 2D and 3D data acquisition campaigns and drilling of two deep and complex, high pressure wells. A third exploration well is currently in the drilling phase, below 5,000 m. energyindustryreview.com

NEWS

GAZPROM GAS DELIVERIES TO AUSTRIA TO INCREASE BY 1BCM/YEAR

Rainer Seele and Alexey Miller at the signing ceremony | Photo: Gazprom

working meeting between Alexey Miller, Chairman of the Gazprom Management Committee, and Rainer Seele, Chairman of the Executive Board of OMV, took place in St. Petersburg on November 5. In the course of the meeting, the parties signed an amendment to the contract on gas supplies to Austria. According to the document, gas deliveries to Austria will be increased by 1 billion cubic meters per year beyond the contractual amount for the entire contract period. “Over the past few years, Gazprom has been setting new records for exports to Austria. In the first ten months of 2018 alone, gas supplies to the country have grown by a third compared to the same period of 2017, reaching 8.8 billion cubic meters. The signing of a document on additional exports beyond the contractual amounts serves as yet another proof of the high demand for

Russian gas on the part of our European consumers,” said Alexey Miller. “Europe’s demand for gas will rise primarily as the result of gas-fired power plants successively replacing coal, coupled with the simultaneous decrease in European production. By increasing gas supplies to Baumgarten in Lower Austria, we are making an additional contribution to security of supply in Austria – as well as to other European countries,” said Rainer Seele. In addition, the parties discussed further steps in the implementation of the agreements signed in October of this year, such as the document establishing a joint coordinating committee for the purposes of collaboration between the companies, as well as the upcoming deal during which OMV will obtain a stake in the project for developing blocks 4A and 5A in the Achimov formations of the Urengoyskoye field. 9

NEWS

UGV SIGN MOU WITH SCHLUMBERGER

aftogaz, Ukrgazvydobuva nnya (UGV) signed a Memorandum of Mutual Understanding (MoU) with Schlumberger Services Ukraine to further enhance their strategic technology collaboration in drilling, hydraulic fracturing, hydraulic stimulation, software development and 3D modeling, as well as the provision of advanced equipment and software solutions. The memorandum underscores their expanding technical collaboration in oil and gas production and paves the way for the introduction of innovative technologies to help streamline gas production in Ukraine. This collaboration with Schlumberger will give UGV and

Naftogaz access to high-technology solutions to help deliver their strategy 20/20 goals. The signatories of the memorandum were Andriy Kobolyev, Chairman of the Naftogaz executive board, Oleg Prokhorenko, Chairman of the UGV executive board, and Gwenola Boyault, GeoMarket Manager, Schlumberger Europe and U.K. During the signing ceremony, the parties announced a new contractual agreement, finalized in October, for coiled tubing (CT) services, including high-technology services using CT units and engineering support. This three-year contract is valued at USD 92 million. One CT unit is already in Ukraine and is ready for use on UGV’s wells. UGV

expects to improve its technological expertise and enhance the production of hydrocarbons using highly efficient CT services and other technologies provided by Schlumberger. The memorandum follows the signing of a three-year multi-service agreement in March 2018 between UGV and Schlumberger, which has resulted in contracting 14 service lines in the drilling, geology and geophysics, and reservoir management domains. UGV has also purchased high-technology services and solutions through the MSA, including fluids, cementing, drill bits, engineering support, directional drilling, wireline logging, and 3D seismic interpretation amounting to more than USD 10 mln.

AKZONOBEL SPECIALTY CHEMICALS IS NOW NOURYON

he former AkzoNobel Specialty Chemicals is being relaunched as Nouryon. The move follows the recent acquisition of the business by The Carlyle Group and GIC and marks the company’s transition to becoming an independent, global specialty chemicals leader. “Launching our new company is a significant milestone to add to our proud history and we are all looking forward to this exciting new chapter,” said new CEO Charles W. Shaver. “We are ready to leverage our experience, global presence, and strong company culture to unleash our full potential as an independent company,” he said. “We are starting from a great position,” Shaver added. “We have a great set of businesses, 10

leadership positions across our portfolio, longterm customer partnerships, and a dedication to continuous improvement and innovation we can leverage for further success. As an independent company we can accelerate our progress on all fronts and take our rightful place alongside other industry leaders.” Nouryon has a history that stretches back nearly 400 years and its new name and brand identity reflect that heritage. Noury & Van der Lande was one of the first companies to realize the important role chemistry could play in everyday life; today, Nouryon is a world leader in essential chemistries used to manufacture everyday products. “When we started developing our new name and brand, we asked our employees

what mattered most to them,” explained Vivi Hollertt, Chief Communications Officer at Nouryon. “Our employees are especially proud of our heritage, as well our track record of growing through partnerships, innovation, sustainability, and contributing to society. We combined all of this to create a brand identity for Nouryon which is true to who we are and helps us stand out from our competitors.” According to the company press release, “Nouryon’s new purpose - Your partner in essential chemistry for a sustainable future - reflects this pride as well as the focus going forward. The company’s success has been built on strong partnerships and it believes that collaboration is key to future success.” energyindustryreview.com

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ROMPETROL CONTINUES ITS PARTNERSHIP WITH THE FOUNDATION FOR SMURD TO SAVE LIVES

MG International continues to support the emergency medical services of SMURD at national level by providing resources for rescue training. The Group acquired and donated two mobile training centres based on vans structures to carry out training, extrication and emergency medical assistance programs for SMURD paramedics. The financial support provided by KMG International amounts to 100,000 USD. “The needs of the public health system are steadily increasing, and we believe in our social duty to contribute to the country’s development and to provide healthcare for those in need. This initiative comes as a follow-up to the commitment we made in 2009, when we started both the collaboration with SMURD and a grants program for the medical sector. We have allocated over 5 million USD for healthcare activities in the last years,” Alexey Golovin, Vice President, KMG International said. The two-mobile training centres

are fully equipped to conduct optimal educational activities for 16 people, with advanced training dummies, human body simulators, defibrillators, silicone resuscitation equipment, patient extraction equipment for difficult areas, first-aid medical backpacking, patient stabilization and modern IT equipment. “Through this project, we will contribute to developing the ongoing staff training within SMURD. We will also achieve another very important step from our vision to bring training activities closer to people and have an integrated emergency system, with highly trained specialists at the highest standards in the field. This project would not have been possible without the support of our partner, KMG International, and of the people who chose to direct 2% of their income tax to the SMURD Foundation. We appreciate every given, because, in the end, it’s important to remember that ... Who saves a life, saves a world!”- said Raed Arafat, Chairman of the Board of Directors of the SMURD Foundation.

With the support of the Romanian General Inspectorate for Emergency Situations, the mobile training centres will be logistically allocated to the Centre and Bucharest-Ilfov region. The SMURD training activity will be carried out with over 10 trainers in all the neighbouring counties (Targu-Mures, Harghita, Sibiu, Alba, Brasov, Bitrita-Nasaud, BucharestIlfov), but also in other regions such as Prahova, Constanta, Craiova, Galati or Iasi. The two-mobile training centres have been presented for the first time, before their formal entry into service, to the 7th and 8th grade students in Blejoi, Prahova. 120 school students will receive a first-aid course offered by SMURD trainers. “The life of an endangered person largely depends on the first aider skills. As medical education starts in schools, I am glad that we can offer these first-aid courses given by SMURD trainers to the children in our community”- Adrian Dumitru, Mayor of Blejoi Commune, added.

P2G - A SECTOR COUPLING PERSPECTIVE

n their joint position paper ‘Power to Gas - A Sector Coupling Perspective’, ENTSO-E and ENTSOG, the European associations of transmission system operators respectively for electricity and gas, call for scaling up the power conversion technologies to further explore its potential. 12

Key messages of this paper include: To date, the electricity transmission grid and currently available technologies efficiently integrated renewable sources of electricity into the power system. The ongoing energy transition will require additional developments. ⁄ Power to Gas – and other P2X (e.g. Power to Liquid, Power to Heat, …) - may have the potential to reduce the

cost of the decarbonized energy system in particular when the end consumption is either gas or other high value energy forms. ⁄ Scaling up of P2G technologies for exploring their industrialisation potential needs to start as of now. ⁄ The ENTSOs are cooperating in an open way to study the impact of foreseen technologies including Power to Gas onto grid planning. energyindustryreview.com

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MOU SIGNED BY OCNI AND ROMATOM

he Organization of Canadian Nuclear Industries (OCNI) and the Romanian Atomic Forum Association (ROMATOM) signed another Memorandum of Understanding (MoU) for cooperation in the nuclear power field. The MoU was signed by Marina Oeyangen, Director of Operations, on behalf of the President, OCNI and by Mihaela Stiopol, Administrative manager on behalf of Gheorghe Lucaciu, President of ROMATOM, at the end of the first day of a joint meeting of the Canada-Romania Nuclear Industry in Bucharest organized jointly by ROMATOM and the Canadian Embassy. The MoU outlines several ways

that OCNI and ROMATOM will continue to work together in identifying opportunities for nuclear suppliers in Romania and Canada. The OCNIROMATOM MoU will also encourage and facilitate cooperation among Canadian and Romanian nuclear research institutes and universities on nuclear research, development, and nuclear education. Both the President of OCNI and the Executive Director of ROMATOM expressed their confidence and support for the extension of cooperation between the two organizations. “OCNI celebrates this MoU signing and looks forward to continuing a strong working relationship with the Romanian nuclear

supplier community in supporting the life extension of Cernavoda units 1 & 2 and in developing future nuclear projects in Romania that will lead to a secure energy supply in the region, creation of jobs in both Romania and Canada, and to further technological developments,” said OCNI President Dr. Ron Oberth. “Romania and Canada are long term partners in nuclear energy beginning with the development of Cernavoda NPP Units 1 and 2 which are among the best performing nuclear units in the world in terms of capacity factor since in-service. We are confident that future cooperation between our organizations will yield future successful projects,” Gheorghe Lucaciu, ROMATOM Executive Director, stated.

RENAULT EZ-PRO: URBAN DELIVERY GOES ROBO

n a world where fast paced urbanization means that more than 60% or 70% of the population, depending of the region, will live in towns and cities by 2030, moving people is not the only task that needs to be rethought. A new era is also beginning for transporting goods: rapidity, flexibility and reliability are the watchwords of the new requirements for consumers at a time that is also seeing a rapid rise in online purchasing. This is accompanied by ever faster and more accurate delivery times with increasingly strict regulatory constraints in towns and city centers. Providing sustainable mobility for all, 14

today and tomorrow is Groupe Renault’s credo. To accomplish this, they are committed to offering mobility solutions that meet the needs of the many. “Tomorrow’s mobility will be electric, connected, autonomous and shared. This naturally includes the delivery of goods, and in particular what is known as ‘the last mile’. Our vision for the future of last-mile delivery builds on our experience of nearly 120 years in the utility vehicle domain and our passion for innovating in order to make our customers’ lives easier. It is nourished by our DNA which places people at the heart of the design of our vehicles. It is also based on our openness to partners, who we work with in an open innovation approach that makes

it possible to go further as we explore new horizons,” Renault representatives affirm. Their vision is articulated around four strong axes: Urban last mile delivery sector is one of the most important areas to disrupt in order to create a future that is clean, free of un-needed congestion, and efficient. ⁄ The commercial delivery is flexible, and that a same platform can be used either in B2B and B2C scenarios. ⁄ The delivery of parcels has to be seamless. End users can choose precisely where, when and how to have goods delivered. ⁄ Finally, and perhaps most importantly, we believe the future of lastmile delivery still has a human touch – someone who remains an essential link in the delivery chain. energyindustryreview.com

TMK TO DESIGN INNOVATIVE SENSORINTEGRATED PIPES FOR GAZPROM

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Dmitry Pumpyansky and Alexey Miller at the signing ceremony | © Gazprom

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lexey Miller, Chairman of the Gazprom Management Committee, and Dmitry Pumpyansky, Chairman of the Board of Directors of TMK, signed at the 8th St. Petersburg International Gas Forum a Technology Roadmap to launch the production of pipes with built-in recording, processing and switching devices. TMK will provide Gazprom with innovative large-diameter pipes with sensors installed under the protective coating for real-time detection of pressure, temperature, stresses and strains. The pipes will be equipped with high-tech ID tags so that they could be identified in a gas pipeline throughout their entire service life. The sensors can be switched to form a single system to monitor the condition of gas pipeline sections.

The new type of pipe products is expected to be used in the areas of intense seismic activity, active tectonic faults and unstable soils, as well as at the intersections of gas pipelines and transport communications. The innovative pipes are meant to improve the reliability and safety of gas pipelines, to increase the accuracy of technical evaluations, and to optimize expenditures for diagnostics, maintenance and repair. The 8th St. Petersburg International Gas Forum was held as part of the Russian Energy Week International Forum. In October 2016, Gazprom signed the updated scientific and technical cooperation programs until 2020 with Russia’s leading pipe producers, including TMK.

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NEWS

UPG PLOIESTI CELEBRATED ITS 70TH ANNIVERSARY

he Petroleum-Gas University in Ploiesti (UPG) celebrated in November its 70th anniversary, a moment marked, in the Aula of the University, by a festive meeting of the University Senate and of the Board of Directors. The event was attended by ambassadors, rectors and teachers from universities in the country, central and local public authorities, representatives of oil, gas and energy companies, academics, graduates and students of the Petroleum-Gas University of Ploiesti. Among speakers of the event moderated by UPG Senate Chair, Ph.D. Prof. Eng. Nicolae Paraschiv, were Ph.D. Prof. Eng. Mihai Pascu Coloja - Rector of the Petroleum-Gas University of Ploiesti, Ph.D. Prof. Eng. Stelian Dumitrescu and Ph.D. Prof. Eng. Niculae Napoleon Antonescu - Honorary Rectors of UPG, Ph.D. Prof. Ioan Stefan Groza - State Secretary within the Ministry of National

Education, Ludmila Sfarloagă - VicePresident of the Prahova County Council, as well as representatives of the 5 Faculties (Petroleum-Gas Engineering, Mechanical and Electrical Engineering, Petroleum Technology and Petrochemistry, Letters and Sciences, Economic Sciences). “Performance in education is certified by the quality of the tens of thousands of specialists in Romania and in over 100 countries of the world who have been trained here. The size of research is revealed by the multitude of patents, treaties, studies with authors from the former or current teaching staff of the University. An argument for the scientific value is also represented by the over 800 PhD titles granted within the University and the precursor Institutes. The ‘high degree of trust’ awarded to the University by the Romanian Agency for Quality Assurance in Higher Education (ARACIS), after each institutional evaluation, is proof of the quality of all activities taking place in the University. I want to thank Mr. Mihail Minescu, Pro-

Rector of UPG, for his involvement in organizing this anniversary of our institution,” UPG Senate Chair, Ph.D. Prof. Eng. Nicolae Paraschiv, has mentioned. “On the 70th anniversary of the University, we pay tribute to our forefathers who, with commitment and dedication, built this institution, which brought great benefits to Romania and is an emblem of the city of Ploiesti and of Prahova County,” UPG Ploiesti Rector, Ph.D. Prof. Eng. Mihai Pascu Coloja, has pointed out. The second part of the day was dedicated to presentation, on sections, of scientific papers. Also, to mark the 7 decades of existence of UPG Ploiesti, the monograph of the institution was launched, ‘The Petroleum-Gas University of Ploiesti - 70 years of performance in education and research’, issued under the coordination of Ph.D. Prof. Eng. Nicolae Paraschiv - UPG Senate Chair, at the Publishing House of the Ploiesti-based University.

OMV AND SCHLUMBERGER SIGN MEMORANDUM OF UNDERSTANDING

MV, the international, integrated oil and gas company based in Vienna, and Schlumberger signed a Memorandum of Understanding (MoU). The parties agreed to evaluate collaboration models for digital solutions. The MoU for a future 16

strategic partnership shall accelerate the deployment of the OMV digital roadmap by leveraging new digital technology available and currently developed by Schlumberger. Both parties would benefit from the collaboration on new mutual digital projects. OMV has defined an overall digital strategy and roadmap to support the

company’s growth and the execution of the OMV Upstream strategy. “The collaboration with Schlumberger would lead us to a front-runner position in chosen areas and give OMV an early access to new digital technology,” Johann Pleininger, OMV Board Member Upstream and Deputy Chairman of the Executive Board, stated. energyindustryreview.com

OPINION

A general view on the revised Offshore Law Daniel Vlasceanu – Partner at Vlasceanu, Ene & Partners

OPENING REMARKS After several promised and exceeded deadlines, the revised Offshore Law was adopted by the Romanian Chamber of Deputies in late October 2018 and enacted by the Romanian President on 12 November 2018. The Offshore Law is potentially one of the most debated pieces of legislation we have seen so far1. And it is only normal to be so, since it regulates (if approved) probably the largest energy project(s) the country will have in the next couple of decades with substantial geo-political implications. MAIN RELEVANT ASPECTS Elements maintained from prior versions As we have already mentioned when analysing the previous versions of the 1. There have been other topics discussed over even longer periods of time (e.g. the royalties regime normative act), but rarely any materialized in so many versions released for public debate, amended, adopted and/or revised as the Offshore Law. 18

law, the Offshore Law brings useful clarifications on certain permitting aspects: • The Ministry of Energy is meant to act as an ‘umbrella’ authority for the offshore activities [i.e. it will be the single authorizing entity issuing the (equivalent of ) the building/ demolition permit for the offshore works] – Art 3; • The titleholders will have an (aerial, above ground and underground) crossing right over plots of land belonging to the state/public authorities (including the beach area!) – Article 10; • The titleholders will be allowed to perform activities (except, of course, exploration and production) in the neighbouring blocks, based on a mere prior notice sent to the respective titleholder(s) – Art 14; • Clarification (now missing from the Petroleum Law) that permits obtained by a single titleholder are valid for the entire joint venture (Art 28 para 4). The obligation of the foreign

subcontractors (i.e. having their head office outside Romania) to set up a local branch or subsidiary remained unchanged (Art 22). Compared to the initial version of the law released in 2017 for public consultation, the last adopted version of the Law gives preference to the mandatory public procurement legislation when referring to the acquisition of goods and services from Romanian/EU economic entities (Art 23). Also, the obligation of the offshore titleholders (not of their subcontractors!) to hire Romanian citizens (minimum 25% of their annual staff ) was also kept (Art 24). New elements brought by the last version 1. Complete fiscal stability As opposed to the version adopted in July 2018, the October version includes (under Article 18) clear language stating that the specific fiscal regime applicable at the time of enactment of the law regarding exploration, development, exploitation and abandonment activities energyindustryreview.com

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remains unchanged. This is one of the key elements the investors have struggled so much (and it is only aligned to the international practice) which was eventually granted. 2. Higher quotas for the supplementary tax Similar to the July 2018 adopted version, the last version of the Law maintained the principle of proportionality between the sale price and the taxation quotas (i.e. the higher the price, the higher the tax quota). Yet, certain tax quotas have been increased: for prices higher than 100 RON/MWh the tax quotas were raised even by 20%! 3. Investment deduction maximum threshold halved Deep offshore developments are, by far, the riskiest and most expensive ones in the oil and gas industry. When it comes to investments, the difference ratio compared to the onshore developments lies in several orders of magnitude (e.g. if onshore a well can rarely get to USD 10mln, in deep offshore the cost of a well can easily exceed USD 75mln). Timewise, the duration required to get from exploration to first production is usually several years longer. As such, from an investment perspective, one may state that an offshore titleholder must risk more and wait longer till cash inflows turn open. The last version of the Offshore Law lowered the investment deduction threshold from 60% (as retained in the July 2018 version) to only 30% of the total tax on supplementary income. In addition, the investments deducted from supplementary income tax will be non-deductible for the profit tax computation. Therefore, it is clear that the titleholders will have to spread the investment recovery over a longer period of time. But there is also a positive clarification (i.e. Art 19 para 9): The Offshore Law now explicitly allows for deduction of investments made both after, but also

before the Law was enacted (as long as they are properly registered in the company’s books and approved by NAMR). 4. The supplementary income tax is to finance the gas distribution networks As per the July 2018 version, the supplementary income tax was destined for the Special Fund for financing public – private partnerships. The latest Offshore Law changed this destination and stipulated (Art 19 para 8) that the supplementary tax income will be allocated for financing the expansion of gas distribution networks and tie into the national gas transportation system. So far so good, but the Law also stipulates that the Government can decide other destinations as well (…). 5. 50% gas sales on local market – fixed throughout the duration of petroleum agreements The annual 50% quota of gas sales which must be sold on the Romanian market was introduced from the previous version. In order to make this obligation stronger, the last version of the Law, added clear language stating that the 50% quota will not be changed throughout the duration of all petroleum agreements (Art 21).

CLOSING OPINION Romania needs the Black Sea projects and this was confirmed also by the draft energy strategy release for public consultation this autumn which revealed expectations that the Romanian economy will rely heavily in the coming years on the Black Sea gas. Following the enactment of the Offshore Law by the Romanian President, the ball is now obviously in the titleholders’ court. Two of them already announced postponement of the FID decisions till 2019. With the fiscal stability topic taken out of the way, it remains to be seen how the Offshore Law terms will influence the economics of the Black Sea projects.

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New Network Code for gas transmission A BIG STEP TOWARDS FUNCTIONALITY Dumitru Chisalita - Judicial Technical Expert in Oil & Gas

new Network Code for Gas Transmission entered into force on 1 October 2018, bringing important A changes at the level of principles compared to the last versions of the Code, being able to finally make applicable this norm and contribute to ensuring the functioning of a liberalized market. The Intelligent Energy Association in 2016 launched a country project called Starting over in the gas market with 10 steps, in order to build a real market and remove the pseudo market that is first of all detrimental to gas consumers. Following round table meetings organized in this period by the Association in order to debate the fact that we can have a fair gas price only with an objective Network Code and a functional market, it resulted that: a) There is a unanimous opinion at gas market level that we need a Network Code in Romania! b) Market participants have identified a number of causes of non-operation of the current Network Code in Romania, summarized in 7 categories: • Physical configuration of the current NTS and adjacent systems; • Legislative framework antagonistic to the old Network Code; • Incomplete and incoherent text of the old Network Code; • Nonexistence of flexibility mechanisms in the Romanian gas market; • Lack of IT platforms and modality for data transmission; • Sabotage of the Network Code implementation process; • Incompetence. 20

c) The Intelligent Energy Association has proposed a minimum set of principles to be taken over in the Network Code: • Separation of contracting for entry capacity from exit capacity; • Entry capacity contracted exclusively by the system partner or its authorized representative (producer, storage operator, domestic importer); • Exit capacity to be contracted by any system partner; • Trading of quantities to be made exclusively in the Virtual Trading Point (VTP), after gas introduction in the NTS and before delivery to the Distribution Systems from the NTS. For gas in the case of which the physical circuit does not interfere with the NTS, it is necessary to define other types of Trading Points, in distribution systems, in regional or local pipelines, in upstream pipelines etc. • Ensuring the legal exception, on allowing natural or legal persons to trade intraday and ex-post imbalances, without holding commercial license, by introducing in the Gas Law the Exchange Titles; • Establishing a Gas Market Operator, independent from the transmission activity, organized as company, licensed by ANRE and with regulated activity, which will have exclusively the role of counterparty in transactions, without being able to become owner of gas traded, and which will benefit from 0 profit from this activity. Thus, equidistance is ensured between the NU and TSO, and there is a possibility to sanction the TSO when it introduces imbalances in the NTS, respectively payment to other NU for gas consumed by the TSO and not received by the NU. A summary initial evaluation of the New Network Code, energyindustryreview.com

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given the aforementioned, shows that although some of the principles proposed to ensure the functioning of a Network Code in Romania have been taken over, and for which we believe an important step forward has been taken, there are still many elements that haven’t been addressed, which in our opinion raises multiple question marks on ensuring the normal functionality of this New Network Code.

Separation of capacity booking on entry/ exit points in the New Network Code on gas transmission The New Network Code separates the capacity booking activity in entry points and exit points of the NTS, introducing the healthy principle under which the gas producer/owner of imported gas will introduce it in the NTS and only then market it, thus having the possibility to ensure the traceability of gas. The principle of separation of capacity booking on entry points and exit points into/ from the NTS has existed before in a draft amendment to the Network Code in 2009, rejected at the time by ANRE. Separating capacity booking on entry points in the NTS exclusively by the gas producer allows: • First of all, to ensure the traceability of gas within the NTS, allowing the identification of network users that are undisciplined in relation to the contracted quantities (capacity, quantity). The lack of this principle has determined in the previous years situations in which due to cascade sales before entry into the NTS of natural gas there were differences between the ‘gas purchased’ and the gas introduced/ extracted from the NTS; • The gas producer is the one who best knows its capacity to produce/deliver gas, which makes it be the one who knows best the capacity it has to book and the quantity it has to deliver in the NTS; • It is the only way to comply with the provisions of the Civil Code on the sale of goods of this type, which in any of the previous situations were systematically breached by the provisions of the old Network Codes. • Separating capacity booking on exit points from the NTS by the gas consumer or the gas supplier that also has the capacity of user of the gas distribution network in which the gas consumer to which it supplies gas is connected allows: • The traceability of gas inside the distribution systems, allowing the identification of users of distribution networks that are undisciplined in relation to the contracted quantities (capacity, quantity); • It is the only way to comply with the provisions of the Civil Code on the sale of goods of this type, which in any of the previous situations were systematically breached by the provisions of the old Network Codes.

Thus, these principles have opened the way to the normalization of the commercial activity in the Romanian gas market. But, as the path to bad practices is paved with good intentions, these principles are not applied at their true value by how they were detailed in the text of the Network Code or by the lack of legal provisions allowing applicability. Thus, we note that: • Capacity booking on entry points can be made exclusively by the gas producer that operates the physical points in its production blocks. Given that at the level of entry points there is a considerable number of points that are operated by the TSO (about 30%) or even the DS, according to the Network Code gas producers cannot sell their gas, the gas transmission operator cannot transport it and consumers cannot consume it; • The exception of capacity booking on entry points, provided in the situation where there are several producers delivering gas through the same metering panel in the NTS, to establish fractions assigned to producers in the physical points in which several producers hand over natural gas violates the provisions of the Civil Code in my opinion; • Gas directly delivered from production blocks in a correct manner is not included in this legislative act, but this activity interferes with the provisions of the Network Code and it isn’t enough to exclude it (pretend we don’t see it); • The traceability of gas inside distribution systems, although intended to be achieved through this New Network Code, will not exist in practice. • We believe that these errors must be urgently corrected. For this purpose, we resume the elements proposed by the Intelligent Energy Association within the project Starting over in the gas market in 10 steps on the considerations exposed above: • Setting the obligation to book capacity in entry points in the NTS exclusively for producers that hold gas in the hand-over/take-over points irrespective of who operates the point; • Preparing a Network Code for upstream pipelines establishing the elements, rights and obligations of those who use these pipelines, respectively deliver gas into the NTS or DS; • The introduction (making official) the notion of capacity at the level of the end-consumer and in distribution systems; • • Preparing a Network Code for distribution systems establishing the elements, rights and obligations of those who use these pipelines. These elements are mandatory to be achieved in order to reach normality intended by the introduction of these new principles in the New Network Code. We will continue to analyse the modality of capacity booking according to the New Network Code. 21

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Nanotechnology and energy production Ioan-Corneliu Dinu â&#x20AC;&#x201C; Scientific Counsellor at Romanian National Committee of the World Energy Council

s we are aware, nanotechnology is the branch of applied science, as well as of engineering dealing with the control of materials organized according to the nanometric dimensional scale (one nanometre being a billionth of a metre). It is also known that the chemical and physical properties of nanomaterials and nanostructures are very different from the macroscopic samples of the materials themselves. This difference of behaviour of matter in the nanoscale represents the development of new classes of materials and devices of structures used even to the improvement of daily life. In the energy sector, nanotechnology increases the portfolio of new technologies for the improvement of efficiency and sustainability of current processes, the most known for energy production, the contribution of nanotechnology being extraordinary. A solution to obtain this change would be to introduce nanotechnological processes working with materials which, at the previously defined nanoscale, can provide them with new properties. As a first interesting example found in the current research could be the sources of nanostructured materials that can be used as catalysts for the fossil fuels production/exploitation and refining processes. An approach on the same subject, i.e. the increase in energy efficiency, is already found starting with the design phase, for both production facilities and for some components that can be used during the development of processes in the energy sector. An example at hand is the increasingly use of nanomaterials with physico-chemical

properties that provide resistance to high temperatures but also to high pressures, i.e. precisely to the essential parameters of processes in coal-fired power plants. Another important field, besides electricity production, is its distribution. The possibility to bring together new materials with special properties ensuring the transmission of electricity, as well as the decrease in energy losses during it are no to be neglected. In this case we can also talk about an example of efficient use of nanostructured materials with properties of optimal electrical conductivity properties, such as carbon nanotubes, which also have exceptional mechanical properties far superior to traditional materials, i.e. steel, and their own weight is lighter than aluminium ones. Another way to use nanomaterials to improve both energy efficiency and energy management is to reduce the use of some obsolete devices that consume a lot of energy. Nanomaterials should be found from the design phase of the new devices, obviously more efficient, with diminished consumptions, devices which would participate in the functioning of various facilities they are parts of. From this example, the notion of integration of nanotechnologies in dwellings can arise: making windows with smart glass assembling the nano-properties of components for the conversion of solar light into electricity by what we have calling for so long the photovoltaic process. The properties of nanomaterials used in the energy sector will be found in the design and construction of energy transmission networks and, what is far more important, of electricity distribution networks. For energy energyindustryreview.com

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specialists, the main concern, traditional we could say, is to guarantee energy supply to human communities, activity which over the past century has meant an extremely important element. Let’s think only about the huge energy losses for electricity distribution and not only (we refer to traditional sources - hydro, nuclear, natural gas, oil, the most important, and then coal, various shale etc). Nanotechnologies are expected to contribute to a greater extent to the improvement of devices for energy generation from renewable sources, giving us the opportunity of a much more responsible and sustainable method for energy management. Forecasts indicate for the near future a centralized energy production, model which can be implemented with the optimization of energy production and management based on local principles, at county level for example, using devices based on nanomaterials,

thus nanotechnologies. It can be achieved right from the production point, anyway not far from the place of energy consumption, so that the entire energy chain becomes efficient. It is expected that manufacturing these devices from nanomaterials will bring flexibility to processes. Such devices would also be economical from the point of view of own consumption and even in terms of aesthetics, so they are relevant at all levels. This type of approach is intended to fully change the energy sector, the urban construction sector, the transport or the health sectors etc. Let’s bring back to discussion the construction of houses, of smart homes having integrated in the walls not only nanomaterials with insulation of great heat and sound efficiency, but also photovoltaic elements to generate the energy that the entire dwelling can use. As regards the conversion of alternative energies, nanotechnologies represent an absolute future. We will return on this issue in an upcoming article.

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Romaniaâ&#x20AC;&#x2122;s Presidency in the Energy Charter Objectives, opportunities and international impact Starting with 1 January 2018, Romania has assumed the Chairmanship of the Energy Charter Conference for one year, being the first EU Member State undertaking this responsibility. We are discussing extensively about the objectives of this international platform and about Romaniaâ&#x20AC;&#x2122;s objectives during this term, opportunities and consequences, with the President of the Energy Charter Conference Iulian-Robert Tudorache, State Secretary in the Ministry of Energy. Dear Mr. President, how was the Energy Charter concept born, what are its general objectives and, especially, the priority guidelines? I can state that the Energy Charter process started in the â&#x20AC;&#x2DC;90s, as a political initiative launched in Europe, at a time when the end of the Cold War provided unprecedented opportunities for overcoming the economic division existing until that moment. Starting from the idea that there were real prospects for increased collaboration in the energy sector, it was intended to establish a platform of cooperation in this field, accepted by both states in Eurasia and

the developed states, the Energy Charter process starting in this context. Thus, the European Energy Charter was signed in 1991 in The Hague and the Energy Charter Treaty (ECT) and the Energy Charter Protocol for energy efficiency and environmental aspects were signed in 1994, in Lisbon. ECT contains rights and obligations for states parties under international law, being developed on the basis of the principles of the Energy Charter, which is a political document. ECT provisions cover critical areas, such as transit of energy and energy resources, investment protection, energy trade, crisis mechanisms, energy

efficiency. But after 2009, following a round of ECT effects assessment, the need to modernize the Energy Charter Process has been highlighted, given the new international energy context, the existence of liberalized energy markets, the competition that is increasing at the level of producing, consuming and transit countries, the importance of environmental protection. Thus, at the Energy Charter Conference in Warsaw, which took place in November 2012, a decision was adopted to initiate negotiations for an Updated Energy Charter. The considerations were 25

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mainly related to the need to replace the obsolete language of the Charter from 1991, having for example references to the former USSR, to the cold war, and the need to reflect the evolutions of the last 20 years in the energy sector. At the same time, it was considered to admit observers in the Energy Charter Process, under lighter terms, create favourable conditions for expanding the Energy Charter Process and the accession of as many countries as possible to this process, and allowing countries where the Energy Charter Treaty is not in force, has not been signed or ratified, to participate in the negotiation of Protocols within the Treaty, as observers. Thus, the final text of the new Energy Charter was established, being named the International Energy Charter. It is important to note that in the text of the preamble to the International Energy Charter it is expressly mentioned that “it is a declaration of political intention to strengthen energy cooperation between signatories and does not give rise to any legal obligation.” The adoption & signing of the International Energy Charter was held in The Hague in May 2015, within a Ministerial Conference. The 1991 European Energy Charter and the International Energy Charter will continue to coexist, and for the accession to the ECT, it will still be necessary to sign the 1991 Energy Charter, as the ECT provisions refer expressly to this document. If I were to summarize the main changes made to the text of the International Energy Charter as compared to the 1991 European Energy Charter, they refer to the inclusion of updated targets for the new Charter, such as strengthening the expansion and enlargement policy, strengthening the structural dialogue in view of promoting the principles of the International Energy Charter, the need to identify solutions to meet the challenges of energy security, at the same time with a sustainable economic development, the increasing importance of regional and international energy cooperation, encouraging the widespread use of renewable energy resources and clean technologies , the need to increase energy efficiency. At the same time, the Annex to the International Energy Charter lists the relevant documents and initiatives of recent years, with direct reference to both the Charter’s basic elements, such as investment, trade, transit, energy efficiency, but also new areas emerging after 1994 in the international energy plan, such as the use 26

of renewable resources, extended international cooperation, intensified dialogue between energy producer, consumer and transit countries. The inclusion of references to numerous initiatives and documents has been accepted in the context of the internationalization of energy cooperation processes, underlining that the new Charter gives equal importance to the cooperation processes in all regions and that there is a willingness to include new energy themes in the Charter Process, insufficiently developed in the 1991 European Energy Charter. Romania has assumed the Chairmanship of the Energy Charter Conference for one year (2018-2019) and you have been appointed President of the Energy Charter Conference in 2018. What is the structure of the team you lead and what are the responsibilities of its members? The team which, in collaboration with the General Secretariat of the Energy Charter, deals with the issues of the Chairmanship of the Charter, includes mainly representatives of the Ministry of Energy, as well as representatives of the Ministry of Foreign Affairs. The team has responsibilities related to the preparation, participation and organization of actions assumed by Romania, as well as to all the other aspects involved by holding the Chairmanship of the Energy Charter Conference in 2018. I can say we have 3 main events, assumed by Romania during 2018, i.e.: • Organizing the Forum on ‘Energy Efficiency - A Priority in Combating Energy Poverty and Ensuring Energy for All’, which was held on 7 June 2018 in Bucharest; • Organizing a Seminar on Cross-border Energy Flow Security and Intelligent Technologies with the support of the Industry Advisory Panel of the Charter and of Transgaz, held in Bucharest on 26 November 2018; • Organizing the 29th Meeting of the Energy Charter Conference in Bucharest, during 2728 November 2018. The team ensures participation in meetings of working groups activating in the context of the Energy Charter, respectively the Working Group for Strategy, with the Subgroup for Modernization, the Working Group for Implementation, the Budget Committee, as well as other meetings and actions of the Charter organized during this year.

The Energy Charter process started in the ‘90s, as a political initiative launched in Europe. Starting from the idea that there were real prospects for increased collaboration in the energy sector, it was intended to establish a platform of cooperation in this field.

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I have to emphasize that it is team work, a team that has proven its effectiveness from the very beginning and understood the importance of Romaniaâ&#x20AC;&#x2122;s mandate during the Chairmanship of the Energy Charter Conference. How important is the assumption of the Chairmanship of the Energy Charter Conference for our country, what opportunities exist and what will be the concrete consequences? The Energy Charter Conference organized in December 2015 in Tbilisi, Georgia, officially approved the takeover of the Chairmanship of the Energy Charter Conference by Romania in 2018, our country being the first EU member state to assume this position since the introduction of the rotating chairmanship principle at the level of the Charter Conference. The Romanian

Government also approved during the meeting held on 12 April 2017 the Memorandum on Preparing for taking over the Chairmanship of the Energy Charter Conference by our country in 2018. Before Romania, the Chairmanship of the Energy Charter was held by Turkmenistan, one of Romaniaâ&#x20AC;&#x2122;s strategic energy partners, who has done an extraordinary work for which I also wish to congratulate them on this occasion. After Romania, the Chairmanship will be taken over by Albania. For Romania, it was an extraordinary chance to have the honour, but also the responsibility, to hold this Chairmanship from 1 January 2018, a chance that offered our country significant opportunities. By exercising its mandate, Romania had the opportunity to imprint its national vision on strategic debates at Charter level and to promote on the agenda of

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By exercising its mandate, Romania had the opportunity to imprint its national vision on strategic debates at Charter level and to promote on the agenda of the Chairmanship priority themes such as: assuring reliable international transit flows and mitigating environmental impacts, a range of national and regional issues such as the eradication of energy poverty and the promotion of energy efficiency, as a solution to combat energy poverty and ensure energy for all.

the Chairmanship this year, as priority themes, in addition to the major objectives of the Charter related to the creation of a stable and transparent investment climate, promoting reliable international transit flows and mitigating environmental impacts, a range of national and regional issues such as the eradication of energy poverty and the promotion of energy efficiency, as a solution to combat energy poverty and ensure energy for all. For Romania, assuming the position of Chairman of the Energy Charter Conference also involves the opportunity to demonstrate its important role in facilitating structured and strategic discussions within the Energy Charter format to improve the adequacy of its objectives and to reaffirm its support and directly contribute to the process of strengthening and focusing the Charter’s activities and promoting an agenda focused on streamlining its activities. But holding the Chairmanship has also meant for Romania facing challenges, such as the Modernization of the Energy Charter Treaty, to take into account the new energy architecture so that it becomes an important tool that can provide a solid legal basis, in order to promote stable and sustained investments in the energy sector. Last but not least, I would like to remind that under Romania’s Chairmanship of the Energy Charter Conference this year, Bucharest will host the Annual Energy Charter Conference, which will be attended by the delegations of all member states, as well as observers. It is an extremely important event, which will bring Romania into international attention and for which the organizational steps have begun long ago, under all the aspects that an event of such scale implies. What is Romania’s contribution and what are our country’s objectives under this mandate? Romania will continue to promote a global vision on the role that the Charter can play in progress towards a secure, accessible and sustainable energy future. We are convinced that the international energy architecture requires the convergent approach offered by the Energy Charter process, with interests and rules based on the contribution of all stakeholders and a common understanding and observance of laws. We expect to see in the coming future significant progress in global efforts to develop low-carbon economies, ensure energy security, maintain costs

at affordable levels and improve efficiency. For these objectives to be reached, both public and private cost-efficient efforts are needed. We must put the consumer at the heart of implementation of the new energy and climate policies, consumer which must benefit from economic growth and the expansion of new technologies in the energy sector. We see the Energy Charter as an appropriate platform for discussing issues relating to investments, investor protection, trade and transit, based on a modernization process in conjunction with the dynamic transformation of the energy sector. I would like to emphasize that the main themes that have been addressed during the Romanian Chairmanship of the Energy Charter are related to the promotion of energy efficiency solutions, through the exchange of best practices and possible incentives, as active instruments for improving access to energy; promoting investment and developing cooperation to attract smart technologies in order to eliminate the technological gap between countries and regions, by focusing on improving production and transmission networks and, last but not least, improving the security and reliability of cross-border energy flows as a critical issue of energy security. In view of the above-mentioned priorities, Romania promoted, during its Chairmanship, the need for structured and strategic discussions within the Energy Charter format on improving the adequacy of the Charter’s objectives in relation to unprecedented changes in the energy market and technological progress, i.e. the modernization of the Energy Charter process. Another important aspect considered during the Romanian Chairmanship will be the Modernization Process of the Energy Charter Treaty. The Energy Charter Treaty has become a significant tool that can provide a solid legal basis for securing and promoting stable and sustained investments in the energy sector, but a process of modernization is needed to contribute to a wider and more coherent understanding of challenges to global energy security, as they manifest today. As Energy Charter debates should focus on the key aspects of the Energy Charter Treaty, the modernization process will first have to address the issues of energy investment, investment protection, trade and transit, settlement of disputes. Also, an updated interpretation and application of the Treaty is needed, to meet the expectations of the energy industry and contracting parties, 29

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encouraging the participation of observers in a more active way in the process so that they eventually become contracting parties. We are determined to support the process of modernization of the Treaty and our joint efforts with the Energy Charter Secretariat have recently been welcomed by European Commission Vice-President for Energy Maroš Šefčovič, in Brussels, on the occasion of the launch of EIRA 2018 publication. The main topics on which discussions on modernization will be launched next year will be established within the Charter Conference in Bucharest. I underline the special importance of the international events that Romania has assumed in the margin of the Chairmanship, and which have a significant potential to increase our country’s international involvement and visibility. How much of the proposed targets to you expect to be achieved by the end of the year and what will remain on the agenda for the next period?

We are approaching fast the end of this year and I can say that we have succeeded in achieving our goals. We had a very good collaboration with the Energy Charter Secretariat, especially with General Secretary Urban Rusnak. The organization in Romania of the three major events, assumed during our country’s mandate, undoubtedly involved a great effort on our part in all aspects, but I am convinced that we have successfully fulfilled our mission and role assumed when we took over the Chairmanship. I would like to add that another priority of the Romanian Chairmanship that we succeeded to complete was the launch of EIRA 2018, the Energy Investment Risk Assessment publication. The main goal of EIRA publication is to help Governments improve investment conditions for foreign investors in the energy sector. It examines and addresses risks related to unpredictable changes, discrimination between foreign and domestic investors and breach of State obligations. The assessment aims to assist governments in recognizing potential

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Under Romania’s Chairmanship of the Energy Charter Conference this year, Bucharest hosts the Annual Energy Charter Conference, attended by the delegations of all member states, as well as observers. It is an extremely important event, which will bring Romania into international attention and for which the organizational steps have begun long ago, under all the aspects that an event of such scale implies.

gaps and to provide opportunities to learn and stimulate reforms that could mitigate these risks and consolidate investor confidence. As I was saying, EC Vice-President for Energy Maroš Šefčovič also attended the launch of EIRA 2018 and he particularly appreciated the work of the Energy Charter. EIRA publication was a priority of the Chairmanship of Romania of the Energy Charter Conference and we are proud that the first public edition was launched during the Chairmanship of our country. 30 countries participated in the preparation of this edition, including Romania, and we want an increasing number of countries to participate in this assessment process in the future. As President of the Energy Charter Conference, I hope that the Energy Charter Secretariat will continue to develop this publication, to reach the goals of the Energy Charter Treaty of ensuring energy supply security, access to energy for all, increasing consumption of clean energy and further promoting energy efficiency. I must mention that the Treaty does not create investment opportunities for companies by forcing free access to resources or by defining a certain market structure for the countries that are members of the Energy Charter. These are sovereign decisions of member Governments. However, once an investment in energy is made, the Treaty has the role of ensuring a stable interface between the foreign investor and the host Government. This stability is particularly important in the global energy sector, where projects are strategic and require significant capital and where risks need to be assessed in the long term. In the margin of the Energy Charter Conference, the Ministry of Energy has been involved in organizing a series of events in Bucharest, including the Forum on “Energy Efficiency - a Priority in Combating Energy Poverty and Ensuring Energy for All”. What were the main conclusions of the forum and what echoes did it have at national and international level?

Highly motivated to improve social welfare, economic sustainability and prosperity, Romania has added energy poverty as a priority theme of its agenda under the Chairmanship of the Energy Charter Conference this year. We were very glad that the theme proposed by Romania for the Bucharest Forum awakened a real interest among the participants, because energy poverty is a common concern for most of the countries of the world. And energy efficiency is increasingly recognized as a valuable energy resource, essential for a sustainable energy future that can help alleviate energy poverty. Improving the energy efficiency of households suffering from energy poverty can not only reduce bills of affected consumers, but also reduce the costs and prices of energy systems for all energy consumers, stimulate job creation, improve energy security and provide many other benefits. Energy poverty leads to social marginalization, because lack of access to modern energy services and inaccessible energy for low-income energy consumers prevent the social and economic development of these families and communities. Although energy efficiency measures aimed to mitigate energy poverty can bring benefits associated with the social and economic progress, the same measures can bring benefits associated with the development of the energy system. Therefore, strategic measures to increase energy efficiency of households in terms of energy poverty should be at the heart of future energy policy decisions. Such actions require support through public finances, but as public budgets are limited and subject to competing demands, the main challenge is to maximize the impact of public finances and their effect on private funding. The International Energy Charter, which is a multilateral legal framework for international cooperation in the areas of investment, trade, transit and energy efficiency, plays an important role in mobilizing private sector investment in energy efficiency and promoting best 31

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practices in the energy efficiency policy. To summarize in a few words the conclusions of the Bucharest Forum, I would point out that energy efficiency is increasingly recognized as a valuable energy tool, crucial to a sustainable energy future, which can contribute to the mitigation of energy poverty, to the decrease in costs of the energy system and, implicitly, to ensuring affordable energy prices for all consumers, to the stimulation of job creation, to the improvement of energy security and to the provision of many other benefits. We are ahead of the major event to be held in the Capital on 27-28 November - The 29th Meeting of the Energy Charter Conference. What is the theme of this meeting, how is the event structured and what audience will it have? The event is structured on two meetings, the first on 27 November 2018, which will represent the meeting of the Energy Charter Conference, attended by the signatories and observers of the Charter and during which decisions will be made on the operation of the Charter in the coming period. On this occasion, the budget and work plan for the following year will be approved and the reports presented by the Secretary-General and the Working Groups will be analysed and discussed. It will also address issues related to the modernization of the Energy Charter Treaty, the takeover of the Charter Chairmanship during the period 2020-2022, the start of the process of analysing the Charter process in the context of the provisions of the Energy Charter Treaty and, of course, the adoption of the Bucharest Declaration. It is a very important document, which is signed according to custom at the end of each Energy Charter Conference and which will practically synthesize the conclusions of the meeting in Bucharest. In parallel, on the first day of the conference, Transgaz will organize in cooperation with the Ministry of Energy the Seminar on “Improving energy security and developing cross-border energy systems. The role of innovation and new technologies”, taking into account the accession of the company to the Industry Advisory Panel and the company’s regional-wise status and the ambitious safety-ofsupply projects that company is involved in. The second meeting taking place in the context of the Energy Charter Conference is the ministerial meeting organized under the auspices 32

of the Ministry of Energy, on “Driving innovation for ensuring energy security, sustainability and prosperity”. In the first part of this meeting, the participating ministers and heads of delegations, Charter members and observers, as well as representatives of the energy industry, will express their views on the themes included in the discussion agenda. The ministerial meeting will be followed by two thematic Panels, which will address issues of cooperation opportunities to facilitate the transfer of technology and innovation in the public and private sectors. We hope to enjoy a high level of participation. The steps to invite the energy ministers of the member countries, the representatives of the European Commission and the high representatives of the international institutions started in June this year. After the Energy Charter Conference works, on 29-30 November, we continue with a series of events in the Prahova County and I′m referring here to the Aspen Energy Summit 2018 in Ploiesti and also a series of visits to the energy objectives located in the Prahova County, one of the most representative County for the Romanian energy sector.

We expect to see significant progress in global efforts to develop lowcarbon economies, ensure energy security, maintain costs at affordable levels and improve efficiency. For these objectives to be reached, both public and private costefficient efforts are needed.

What message does Romania convey at the end of the year for the international energy community and what significance did this experience have for you as President of the Energy Charter Conference? The main messages we want to convey to the international energy community are of course included in the Bucharest Declaration. I believe, however, that it is of major importance to improve the cooperation framework for completing the technological gap between countries and regions and to increase energy security by developing international cooperation aimed at ensuring an integrated energy market and secure transit corridors. In the context of a European agenda highlighted by many energy challenges, I believe that the biggest one is to ensure energy security, with the role to reveal the way in which European solidarity is understood. Romania is fully involved in the efforts of the international energy community to ensure a stable and sustainable energy security framework in both Central and South-Eastern Europe and across the European Union. The process of strengthening regional cooperation needs to energyindustryreview.com

INTERVIEW

be stepped up, underlining the need to promote a unitary energy message. Ensuring by Romania the Chairmanship of the Energy Charter Conference in 2018 provided the opportunity to highlight the convergent approach of energy issues, to maintain an open and active dialogue between the member states of the European energy community, with the contribution of all, as an important tool serving the energy goals of the energy community in its entirety. I am convinced that, based on its role and expertise, Romania is regarded with interest in the European space and its voice is listened. Through its geographical position and its energy potential, in all its aspects, our country has the capacity to play a significant role in the regional energy equation. Romania actively contributes to the definition and consolidation of the European Unionâ&#x20AC;&#x2122;s energy diplomacy and fully supports the European efforts to promote a common approach and voice of the EU in the promotion of strategic

energy objectives. Therefore, cooperation, as a basic principle of European energy policy, must be the main means of overcoming the energy challenges at regional level, with potential impact at an enlarged European level. In conclusion, I want to thank for the trust I was given by my appointment as President of the Energy Charter Conference during Romaniaâ&#x20AC;&#x2122;s Chairmanship of the Energy Charter Conference in 2018. It was undoubtedly an honour, and also a great responsibility. But I firmly believe that Romania has managed to successfully exercise this mandate and that it has succeeded in capitalizing on this extraordinary opportunity offered by the rotating Chairmanship of the Energy Charter Conference. I am convinced that we will hand over tangible results to the next Chairmanship ensured by Albania, and that the consistent and especially team efforts of Romania will be continued, in order to reach the major objectives of the Energy Charter.

OIL & GAS

Black Sea Oil & Gas signed the gas transmission contract for the Midia Gas Development Project

Ijdelea Mihailescu law firm assisted Black Sea Oil & Gas (BSOG) throughout the performance of the open season capacity booking process and its finalization by the signing with SNTGN Transgaz of the gas transmission contract necessary for the Midia Gas Development Project (MGD Project), a project aimed at putting into production the natural gas of XV Midia Block, offshore Black Sea, Romania. 34

ith respect to the MGD Project, W Mark Beacom stressed that: “While the assessment of the impact of the offshore law on our business is still underway, we continue to move ahead to close out all the remaining milestones, necessary for our Shareholder and Partners to reach a decision. These milestones include completing all the regulatory requirements, the signing of a gas sales agreement with a gas buyer, having in place all the long lead and major equipment purchase orders, EPCIC and Drilling Contracts. The assessment of this Offshore Law on the project’s economic viability will be energyindustryreview.com

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a key part in determining whether a favorable decision to FID will be taken.” “Given the natural gas deposits discovered in the Black Sea in the last period, Transgaz intends to expand the National Transmission System in order to set up an additional entry point for the natural gas coming from the Black Sea offshore blocks. The project consists of building a new 20″ (Dn 500) gas pipeline designed to carry natural gas at a pressure of 55 bar, with a total length of approximately 24.37 km that will connect the Black Sea coast with Transit 1 transport pipeline on the route Black Sea coast – Corbu – Sacele – Cogealac – Gradina. The project will contribute to the sustainable development of the area, and all natural gas coming from this block will enter the National Transmission System,” said Ion Sterian, Transgaz’s General Director. “We are proud that our team was preferred

again by Black Sea Oil & Gas, being involved in this process on behalf of our client from the start of negotiations for the execution of a cooperation agreement with SNTGN Transgaz back in 2016. We continue to enjoy the trust granted to us more than 10 years ago, time in which we have successfully assisted Black Sea Oil & Gas in all the steps related to the petroleum exploration and move-ahead to development carried-out by the company and its partners,” Oana Ijdelea stated. The contract, which is subject to FID, is the outcome of the successful efforts undertaken under a Cooperation Agreement signed in 2016 and an open season capacity booking process which first commenced in July 2017. The contractual period covers 15 years with a first gas delivery date on 1 February 2021 at a transmission capacity of 1 Bcm/year. The Midia Gas Development Project

consists of 5 production wells (1 subsea well at Doina field and 4 platform wells at Ana field), a subsea gas production system over the Doina well which will be connected through an 18 km pipeline with a new unmanned production platform located over Ana field. A 126 km gas pipeline will link the Ana platform to the shore and to a new gas treatment plant (GTP). The processed gas will be delivered into the National Transmission System operated by Transgaz at the gas metering station to be found within the gas treatment plant. Black Sea Oil & Gas is a Romanian based independent oil and gas company, targeting offshore exploration and development of conventional oil & gas resources, owned by The Carlyle Group and the European Bank for Reconstruction and Development.

OIL & GAS

Romgaz, 5 years on Bucharest Stock Exchange

fter five years since its listing on the Bucharest A Stock Exchange, Romgaz - the largest gas producer and the main gas supplier in Romania, is on top of transactions, and the share price went up 15% compared to the offering price. The listing of the National Gas Company Romgaz, under the SNG symbol, has been one of the largest offerings carried out by the Romanian state through the Bucharest Stock Exchange (BSE). SNG titles started trading on the main market of BSE on 12 November 2013, following the successful development of an initial public offering worth a total of RON 1.7bn, carried out both on BSE and LSE (London Stock Exchange). For Romania, it was the largest offering carried out by the Romanian state through BSE until that date and the second largest after Electrica’s listing, a year later. “Romgaz listing on the Bucharest Stock Exchange and London Stock Exchange has been an important moment in company’s history. Listing has increased the degree of transparency and communication with investors, the business environment and public in Romania and abroad. Romgaz has assumed its responsibilities arising from company’s listing, i.e. reporting and communicating the important events in the life of the company to the stock exchange. We shouldn’t forget the image boost from which a listed company benefits. Institutional and individual investors, the press in general, the business environment monitor closely the company’s evolution and help enhancing the reputation, promoting and developing our business,” Romgaz CEO Adrian Volintiru has stated. “Romgaz is the state-owned company with the largest share in several indices of the Bucharest Stock Exchange and represents an important investment anchor for institutional investors, such as investment funds or pension funds. Romgaz is also an example of success for other state-owned companies that can be listed on the Romanian stock exchange. Resuming energyindustryreview.com

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the process of listing state-owned companies means transparency, and transparency on the stock exchange translates in money. Company’s shareholders will be able to benefit later from the advantages of listing, such as the possibility to increase the share price or grant dividends,” BSE CEO Adrian Tanase has stated. In 2013, the Romanian state, the majority shareholder of SNG, sold 15% of the registered capital of the company. The offering aimed at the sale of a maximum number of 57,813,360 shares issued by the company, as shares and Global Depository Receipts (GDRs). The sale price was RON 30/share and USD 9.25/GDR, which made the total value of the offering to be RON 1.7bn. The price per SNG share was RON 34.5 in early November, which means an

AMROMCO

increase by 15% compared to the offering price. “Romgaz is one of the largest and most traded issuers on BSE. In the first ten months it recorded a trading value with Romgaz shares of RON 850mln. Romgaz is one of the listed companies of significant size in Romania that has attracted and will attract significant investments from worldclass institutional investors, which will help the capital market in Romania get closer to the strategic objective of promotion to the emerging market status. The more such performing companies we have on the stock exchange, the more will Romania benefit from increased investments and new jobs, and all these will translate into welfare for Romanians,” Lucian Anghel, Chairman of the Board of Directors of BSE, has stated. “Listing on the capital market forces

us to achieve performance. We currently have several directions. First of all, we will continue investments in onshore exploitation, also focusing on the replacement of reserves with new ones. We want to invest in the petrochemical industry and obviously in consolidating our position on energy trading markets. In the field of electricity production, Romgaz aims to streamline its activity by making investments to increase the yields of Iernut Power Plant, comply with the environmental requirements and increase safety in operation,” Romgaz CEO Adrian Volintiru has mentioned. The value of dividends distributed to SNG shareholders during 2013-2017 was almost RON 7.4bn. The largest shareholder of SNG, with a 70% stake, is the Romanian state through the Ministry of Energy.

Romania’s largest and oldest independent oil and gas company.

ENERGY

Redeveloping oil and gas fields through new technologies and innovative business and operations systems.

PLOIESTI 348 Gh. Grigore Cantacuzino St., 100301 C25 Building T: (+ 40) 244 512 361 BUCHAREST

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19-21 Primaverii, A Wing, 1St Floor, Flat No.11

E: officeplo@amromco.com

1St District 1, 011972

W: www.amromco.com

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Romania to revive trade relations in the Gulf region Daniel Lazar

delegation of the Government of Romania, led by A PM Viorica Dancila, had on 21 October a meeting with Emir Sabah Al-Ahmad Al-Jaber Al-Sabah, Head of the Kuwait State, during the official visit of the Romanian official in Kuwait. The delegation led by the Prime Minister included Teodor Melescanu - Minister of Foreign Affairs, StefanRadu Oprea - Minister for the Business Environment, Trade and Entrepreneurship, and Sorina Pintea - Minister of Health. Attending the meeting with the Head of the Kuwait State, were also the Crown Prince, Nawaf Al-Ahmad Al-Jaber Al-Sabah, and Kuwait State Prime Minister, Sheikh Jaber Mubarak Al-Hamad Al-Sabah. The Romanian high official pointed out that 2018 marked an important symbolic moment, namely the anniversary of 55 years of bilateral diplomatic relations, and pointed to the importance of intensifying in the future the political dialogue and strengthening the bilateral cooperation on the political, diplomatic, economic and sectoral levels. PM Viorica Dancila reiterated the commitment of the Government of Romania for consolidating relations with the Kuwait State, an important partner of our country in the Gulf region, both as Romania’s foreign policy objective and in the context of holding, in the first half of 2019, the rotating presidency of the EU Council. The visit continued to the United Arab Emirates, where it is intended to seriously improve the economic collaboration. Romania’s Prime Minister expressed her satisfaction for the positive development of the Romanian-UAE relations, in this context presenting her conviction that the two states would sign in the near future the Joint Declaration on the establishment of an extended economic partnership between the Government 38

of Romania and the Government of the United Arab Emirates, which will help ensure a harmonious, pragmatic development of the Romanian-UAE relations, a Government press release shows. “Romanian companies and the Government have common goals - to enter new markets with quality products, to increase exports and develop a competitive economy,” Minister Stefan-Radu Oprea underlined. The high officials agreed to organize the first session of the Romanian-Kuwaiti Joint Cooperation Committee, coordinated by the Ministers of Foreign Affairs, in 2019. Discussions between Prime Minister Viorica Dancila and the Head of the Kuwait State, Sabah Al-Ahmad Al-Jaber Al-Sabah, were also the occasion for making an exchange of opinions on topics of interest on the international and regional agenda, with a focus on the recent developments in the Middle East. In this context, PM Dancila pointed out that Romania would continue to pay a special attention to the Southern Neighbourhood of the European Union, while promoting the political settlement of disputes in the Middle East and North Africa. energyindustryreview.com

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EUR 560,000 for a Master’s degree in the field of oil and gas engineering Daniel Lazar

OPELC Project was completed T in October this year, with a total non-reimbursable value of EUR 560,000, which aimed to conceive, develop and implement a new curriculum program for the Master’s degree in Oil and Gas Engineering, in a joint effort between universities across the European Union (EU) and partner Lebanese universities. At the end of 2015, during a fierce competition within the Erasmus+ Programme, Key action 2, within the measure named Capacity Building in the Field of Higher Education, the PetroleumGas University of Ploiesti (UPG) won the only project received by Romania from the European Commission, following the evaluations made. This program has led to a partnership between three universities in the EU space: The Petroleum-Gas University in Ploiesti (UPG, Romania), Kungliga Tekniska Hoegskolan (KTH, Sweden), Ecole Nationale Superieure Des Mines de Saint-Etienne (EMSE, France) and other four universities in Lebanon: Lebanese University (LU) - the only state-owned and the largest university in Lebanon, Notre Dame University (NDU), the University of Balamand (UOB) and the Beirut Arab University. The eighth partner was represented by the Directorate General of Higher Education (DGHE) within the Ministry of Education in Lebanon, which was an associate partner in this project and had an essential role in the certification and 40

promotion of this study program. The project was carried out during 1 January 2016 – 14 October 2018, in full compliance with the requirements of the Bologna Process, the last activity taking place during 8 - 10 October 2018, in Lebanon, occasioned by the Final Conference of the Project. The new Master’s Degree Program, developed within GOPELC, has provided qualified and highly experienced professional resources, able to support and manage the development of the oil and gas industry in their country of origin and abroad. For this purpose, a start conference was organized within the GOPELC project in Ploiesti, in March 2016, as well as five workshops, of which three in Romania, one in France and one in Sweden, two webinars for trainers and for the transfer of best practices of EU partners in the field of oil and gas processing to Lebanese partner universities. Within the project, 30 members of the EU partner universities were involved in preparing English materials (courses and lectures) and in their presentation during the workshops, 55 members (teachers) of the four Lebanese partner universities within the project were trained within these workshops and webinars, and 28 students enrolled in the new Master’s Degree Program performed practical training in the EU partner universities and in oil and gas companies. On this occasion, UPG hosted 10 students from Lebanon in 2017 and 13 students from

Lebanon in 2018, to carry out a practical training of one month within prestigious companies in the oil and gas industry: OMV Petrom, Conpet, Dosco, Romgaz and Bonatti International. Each student completed the training through the mandatory preparation of an activity report. The benefits of the project refer to some important aspects especially for the future: the preparation of course materials, in English, by the teachers within UPG who supported activities within the workshops, materials which can be used in future Bachelor and Master’s degree studies, in English, which will take place at UPG; the conclusion of partnerships between UPG and Lebanese partners, of the type of Erasmus mobility, allowing academic exchanges of teachers and students between UPG and the Lebanese universities; involvement of the Lebanese universities in sending students to take part in the Summer School of UPG, which has been done over the past 2 years; opening new opportunities for collaboration in international projects; improving the visibility and image of UPG in a Middle East country, Lebanon, with extraordinary potential in the field of oil and gas resources, especially in the continental shelf area. The team of the project on behalf of UPG Ploiesti included PhD Prof. Eng. Lazar Avram, PhD Prof. Catalin Popescu, PhD Prof. Eng. Mihai Albulescu, PhD Lecturer Valia Mihai and Isabela Girjoaba. energyindustryreview.com

BrauBeviale: Efficient pressure performance up to 45 bar! Boosters are needed when, for production-related reasons, compressed air is required at a higher pressure than network pressure. With innovative speed-controlled all-in-one systems, Kaeser Kompressoren is proud to open a brand-new chapter in booster compression. Kaeser’s new boosters provide the ideal solution for compressed air users in the brewery industry who require higher pressure air. As the first all-in-one booster system, the DNC series from Kaeser is now also available with variable speed control. As a result, the compressor flow rate is matched to actual air demand, which means that only as much energy is consumed as is needed to produce the supply of higher pressure compressed air. The system is therefore also especially efficient in the partial load range since the compressor switches to idle operation when air demand drops below the control range. Compressor operating speed and energy consumption are consequently kept to a minimum. The DNC SFC system is delivered ready to connect complete with sensors and frequency converter. All systems are CE and EMC certified and thereby minimise planning, construction, certification, documentation and commissioning cost for operators and equipment manufacturers. The efficient compressor unit, the compact enclosure and the entire electrical system are mounted on a space-saving base frame. Moreover, the highly effective sound insulation panelling helps ensure lownoise operation with low compressed air discharge temperatures. Connection of the booster system to an advanced master controller, such as the Sigma Air

Manager 4.0, is made possible by the integrated Sigma Control 2 controller. This technology also enables integration of the booster package into Industrie 4.0 production environments. Kaeser’s new CNC series machines are the ideal choice for breweries with smaller air delivery requirements. With motor capacity from 7 to 22 kW, they will also be available both as standard and frequencycontrolled versions in all power ratings.

EFFICIENT SOLUTIONS IN THE LOW-PRESSURE RANGE With a motor capacity of 7.5 to 22 kW and flow rates of 2.3 to 12.2 m³/min, the CBS rotary screw blower provides the perfect solution for users, for example, who require air for wastewater treatment in operational clarification plants with a pressure differential of up to 1100 mbar. The blower also shines through with its many benefits when it comes to liquid aeration, flotation, fluidisation and bioreactor applications. It is up to 35 percent more efficient than comparable conventional rotary lobe blowers and even offers significant energy advantages in the double-digit range compared with many other rotary screw blowers on the market. In fact, a rotary screw blower is so powerful that it can easily and effectively cover the control range of two to three rotary lobe blowers.

Quiet and efficient - Kaeser boosters combine compact and modern design with variable speed control.

KAESER KOMPRESSOREN S.R.L. Address: 179 Ion Mihalache Blvd., 011181 - Bucharest Tel.: +40 21 224 56 81 Fax: +40 21 224 56 02 Web: www.kaeser.com Email: info.romania@kaeser.com 41

OIL & GAS

Hopes and dissatisfaction on the promulgation of the Offshore Law As we have written before, this summer has been a hot one not only literally, but also if we refer to the much debated and widely disseminated Offshore Law, which President Klaus Iohannis finally promulgated on 12 November, in the version adopted three weeks before by the Chamber of Deputies, as decisional forum. However, two of the operators have already announced the postponement of the investment decision regarding the Black Sea until 2019.

Daniel Lazar

ccording to a study by Wood Mackenzie, following A the adoption of the Offshore Law Romania has become less competitive in terms of exploitation of unconventional gas than all the other states bordering the Caspian Sea and the Black Sea, except Azerbaijan. A Deloitte study shows that the effective taxation rate (royalties plus other similar taxes) in Bulgaria was, in 2016, 7.1% of income, while in Romania it was 17.5%. And that’s before the adoption of the Offshore Law. Even if the offshore law hadn’t been adopted, the royalty for Neptun Deep alone would have been 13.5%, but in reality, it would be even higher following the fact that it is applied to the price on the Vienna exchange and not to the actual price achieved by producers upon sale, by 25-30% lower. 42

The Offshore Law has created numerous controversies, both among specialists in the field and the elected officials, because the parliamentary majority has repeatedly amended the draft law, imposing a progressive taxation system applied to the petroleum companies’ profits. In fact, the mentioned Law reached the table of Romania’s President Klaus Iohannis since early August this year, but he refused to promulgate it at the time, sending it back to the Parliament. The elected officials restarted to work on it, in conditions in which the Government was late in providing the elected officials of the country with information absolutely necessary to make a decision on the final form of the law. energyindustryreview.com

OIL & GAS

LAST SUMMER TENSIONS Parliament passed in July this year the Offshore Law, which sets certain measures necessary to implement petroleum operations of exploration, development and exploitation of petroleum fields and abandonment, as well as well works related to petroleum operations, carried out by the titleholders of petroleum agreements regarding offshore petroleum blocks. Chamber of Deputies Speaker Liviu Dragnea stated at the time that, through the amendments to the draft Offshore Law, it was aimed that Romania would no longer be energetically dependent on Russia. “The CEO of OMV came to me and the next day the President of ExxonMobil from the US and, of course, the topic was the offshore law. It was a tensed discussion. They have expressed their desire to continue Black Sea investments, but taking into account their desires, fiscal stability, the freedom to sell their gas in conditions of profitability and I told them what I had stated publicly. My position from last summer hasn’t changed, in the sense that Romania must have sufficient financial gains and a significant share of what is gained in this business, because it’s about a natural resource of Romania and, also, a large share of this gas production must be sold on the Romanian market, so that our economy benefits in the following 20-30 years. The second objective is to have energy independence. We need to find a fair balance between the legitimate Romanian interests and those of investors,” Liviu Dragnea said. THE INVESTMENT DECISION ON THE BLACK SEA POSTPONED OMV Petrom has announced the postponement of the final investment decision in the Neptun Deep block, in which it owns a 50% interest, equal to that of its partner, ExxonMobil, which is also operator. The reasons invoked was the sluggishness in the adoption of the Offshore Law, restrictions imposed for gas export and lack of fiscal predictability and stability. At the same time, Austria’s OMV is confident that, in the following months, Romania will put in place an acceptable regulatory framework for its exploration project in the Black Sea, so that the company can soon give green light to an investment worth EUR 1bn, Johann Pleininger - Deputy Chairman and Member of the Executive Board Responsible for Upstream (Exploration & Production), OMV, has stated in an interview with the international press. Companies ExxonMobil and OMV Petrom jointly explore the Neptun Deep block in the Romanian territorial waters of the Black Sea, where the first estimates show the existence of gas reserves of 42-84bcm. “OMV needs a serious framework regarding taxes and royalties before giving the final approval for such a major investment,” Johann Pleininger mentioned. One day after OMV Petrom, Black Sea Oil and Gas also announced the postponement of the investment decision regarding the Black Sea. “Black Sea Oil & Gas is currently assessing

“Black Sea Oil & Gas is currently assessing the impact of the draft Offshore Law voted in the plenary sitting of the Chamber of Deputies. The outcome of assessing the impact of this Offshore Law on the project will be clearly considered for making a favourable investment decision.” Mark Beacom, Black Sea Oil & Gas

the impact of the draft Offshore Law voted in the plenary sitting of the Chamber of Deputies. In parallel with this assessment, BSOG claims that it will continue to advance with all the activities necessary to reach the point where partners and shareholders can make a decision on the Midia Gas Development project. These activities include the completion of engineering studies ( feasibility study, technical design and detail engineering), the fulfilment of all requirements for the authorization of the project, signing the gas transmission contract with Transgaz, the gas sale-purchase contract, completion of orders for equipment with long procurement period, signing the works contract and the contract for the drilling of development wells and the successful 43

OIL & GAS

Iulia-1 well

completion of financial arrangements to ensure project financing. All the mentioned contracts will be applicable only in the event of obtaining a final decision to invest in this project. Upon completion of all these activities, all the risks, costs and potential revenues involved by the project will be presented to partners and shareholders. The outcome of assessing the impact of this Offshore Law on the project will be clearly considered for making a favourable investment decision” - Mark Beacom, CEO of the company, mentioned.

TECHNICAL STUDY PREPARED BY THE PETROLEUM-GAS UNIVERSITY Beyond the actual educational process, research activities are also carried out within UPG Ploiesti, coordinated by Ph.D. Prof. Eng. Florinel Dinu, at the Faculty of Petroleum and Gas Engineering, which over the past few years has had a remarkable contribution to the development of national research contracts, of strategic interest. Over the past 15 years, a multidisciplinary research team has been created here, which includes teachers from all five faculties of the University, such as: Ion Pana, Lazar Avram, Dumitru Frunzescu, Iuliana Ghetiu, Mihaela Neagu, Daniela Movileanu, Dorel Dusmanescu, Tudorel Bogdan, Daniela Buzoianu, Aura Patrascu etc. At the same time, Prof. Florinel Dinu has been and continues to be involved in solving national and international disputes in the field of oil and gas, by giving numerous expert technical opinions in court proceedings. The research contracts addressed and solved have as target aspects such as solving a stringent problem of the highest importance at national level in terms of Romania’s energy strategy, through the Research and consultancy contract having as subject matter ‘Research and technical expertise on setting the reference price of natural gas extracted in Romania’. Setting the reference price of natural gas for gas producers is an important step for the Romanian state in issuing the Royalty Law applicable for onshore and offshore gas fields. According to the study, for 10 years, starting with 2008, the reference price of gas had been frozen, i.e. artificially maintained constant, at RON 495/TCM or RON 45.71/MWh, which created at the Romanian state budget a deficit of RON 7bn, the equivalent of Romania’s consumption for one year! The reference price of natural gas is the key element for 44

the determination of the royalty value collected by the state, in exchange for the concession of gas field exploitation and it is also relevant for determining the profit of gas producers. Through the entry into force of Order no. 32 of 12 February 2018 on the approval of the Methodology for determining the reference price for natural gas extracted in Romania, issued by the National Agency for Mineral Resources (NAMR), methodology established under the research contract, it was thus allowed to increase royalties collected by the Romanian state by approximately 50%...100%, through the alignment with prices practiced on the European gas market. Also, the implementation of the ‘Methodology for determining the reference price for natural gas extracted in Romania’ is currently continued by the sale research team led by Prof. Florinel Dinu, under the Research Contract having as subject matter ‘Research on developing a software application to collect data necessary to determine the reference price of natural gas extracted in Romania in an online database and to calculate royalties owed to the state’. The work highlights the entire gas flow produced in Romania and its quality, aiming to implement a performing software developed by UPG researchers, on the calculation of royalties owed by all gas producers in Romania. In the end, the results of the IT application will be automatically calculated and centralized, easy to follow on the terminals of the two government agencies, such as the National Agency for Fiscal Administration and the National Agency for Mineral Resources (NAMR). Regarding the reporting of the energy sector to a world that wants to be less and less polluted, by applying efficient technological processes, the research team led by Prof. Dinu Florinel has also dealt with the ‘Establishment of the methodology for the certification of technological consumption related to petroleum operations in the field of natural gas extraction, storage and transmission’. Currently, Prof. Florinel Dinu is negotiating a new research contract at national level, having as subject matter the Network Code for the underground gas storage sector in Romania. While in September we concluded that the recently adopted form of the Offshore Law would suffer changes, it is interesting to see whether this statement remains valid, after its promulgation... energyindustryreview.com

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OIL & GAS

PPG PITT-CHAR NX resists severe jet fires, pool fires and explosions. | Photo: PPG

The next generation of flexible passive fire protection coatings 46

energyindustryreview.com

OIL & GAS

PG, a global leader in protective P and marine coatings has announced the launch of PPG PITT-CHAR NX, its most advanced passive fire protection coating. PPG PITT-CHAR NX epoxy intumescent coating offers reduced coating thickness, lower weight and faster application, at the same time providing outstanding strength and

durability thanks to PPG’s unique flexible technology. An intumescent coating system designed to protect against the most severe hydrocarbon hazards including - pool fires, jet fires and explosions - PPG PITT-CHAR NX is ideally suited to both onshore and offshore environments in the oil, gas and petrochemical industries. “PITT-CHAR NX is a major advance in passive fire protection technology, combining higher safety performance in a thinner, lighter coating that is faster to apply,” says Richard Holliday, Global Product Manager at PPG’s protective and marine coatings business. “We have drawn on over 35 years’ experience to develop, in our own state-of-the-art laboratories, this unique technology which brings major advantages to owners, engineers, fabricators and applicators.” The oil and gas industries are facing ever more complex fire scenarios that can potentially involve pool fires, jet fires and explosions in both onshore or offshore environments. These projects also demand fast throughput during fabrication and application to maximize efficiency. Because it is lighter than alternative PFP coatings and cementitious systems, PPG PITTCHAR NX delivers substantial material savings and reduces both transport and construction costs. “We designed PPG PITT-CHAR NX to reduce uncertainty by ensuring it is capable of protecting against the full range of hydrocarbon hazards. Owners and designers no longer need to choose between solutions optimized for jet fire or pool fire; PITT-CHAR NX does both,” adds Holliday. “Our system is comprehensively tested to comply with internationally recognized fire test standards for all types and sizes of structural steel and safety critical equipment.” Extremely tough, yet uniquely flexible, PPG PITT-CHAR NX is designed to eliminate the risk of cracking and delamination during fabrication, transportation and construction. This is critical in today’s

global market where transportation and vastly varying climatic conditions can cause challenges for coatings on steel. Testing has proven PPG PITTCHAR NX to be suitable for industrial, marine and offshore exposure without any degradation in fire resistance. It is extensively tested by third parties to the toughest and latest standards from ASTM, ISO, NORSOK and UL.

WORLD-CLASS PROTECTIVE COATINGS FOR THE OIL, GAS AND CHEMICAL INDUSTRIES PPG is dedicated to the development, manufacture and supply of coatings and fire protection solutions that meet the challenging needs of the oil, gas and chemical processing industries. PPG team vast knowledge and experience of this field allows them to offer a truly world-class and comprehensive protective coatings range, featuring outstanding tank linings, zinc-rich primers, generalpurpose epoxy primers and durable finishes. All of these coatings are compatible with the PITT-CHAR® XP coating, and are proven to withstand the very harsh environments and hazardous operating conditions of offshore and inland drilling, processing and storage facilities. PPG: “WE PROTECT AND BEAUTIFY THE WORLD™” “At PPG, we work every day to develop and deliver the paints, coatings and materials that our customers have trusted for 135 years. Through dedication and creativity, we solve our customers’ biggest challenges, collaborating closely to find the right path forward. With headquarters in Pittsburgh, we operate and innovate in more than 70 countries and reported net sales of USD 14.7 billion in 2017. We serve customers in construction, consumer products, industrial and transportation markets and aftermarkets.” 47

OIL & GAS

ROBOTS TAKING OVER!

The ‘hows’ and ‘whys’ of making our lives easier and cheaper Vlad-Adrian Iancu

No, it’s not another weak Hollywood plot; it’s about living easier, cheaper, cleaner lives. Robots in industry are by no means something new. Actually, they’ve been around for a good 20 years, with uses documented as far back as the eighties. So why should we bring it up again? We do it because now it’s all interlinked courtesy of digitalization and Internet of Things. Ok, calm down, we’re still far from real artificial intelligence and humanoid robots stealing our jobs from under us, that’s not the case. But what if it was? An industry where we don’t have to get our hands dirty so often, perform tasks ten times faster at half the price and without affecting the environment sure sounds like a great idea. Intelligent people always sought easier solutions to their problems and sometimes the best solution is to have somebody else do your job. Delegation is a skill after all. But, are our robotic little and big friends up to the task? And if they aren’t, it’s our job to make them better versions of ourselves. Let’s see how exactly do offshore robots fit in the current and future oil and gas industry. 48

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OIL & GAS

ake no mistake about it, as M tasks are shifted from human responsibility to robotic one, the global work market will also undergo some dramatic changes. With more and more technological wonders popping up every day, this transition and the capacity to adapt to it will make or break certain companies, as the Fourth Industrial Revolution will wait for no man or machine alike. Stationary robots or land, underwater and aerial drones are sometimes adopted and invested in as soon as they leave the assembly line with leaders in the Oil & Gas industry reporting significant business interest. In consequence, they expect an important change in the division of work tasks come 2022. Whereas now work is mostly covered by human employees, the balance may shift towards machine labour pretty soon. BP Global is one of the leaders of change, specifically in their Gulf of Mexico platform – Thunder Horse. Where once offshore operators had to conduct lengthy inspections of the facilities, now this task has been undertaken by crawlers and flying robots independently of the weather conditions. A process that was once described as lengthy and tedious, on account of limited human reach, is now markedly improved by the addition of robots which do the job faster and also yield considerably more data than their human counterparts. After all, capturing images of pipes and other machinery is easier with built in 360-degree cameras. So, BP’s Digital Innovation Organization (DIO) brought in their technological knowhow to the table, offering autonomous machines with digital sensors and analytics, practically transforming this inspection from an observational activity to a quantitative science. Since their first trial run in 2016 proved so fruitful, they have added a magnetic crawler which navigates the hull structure and a drone which surveys the riser pipes facing away from the hull. According to Dave Truch, technology director for DIO: “Taken together, the drone and crawler were able to capture not only

To help the team identify any potential hazards during the inspection, the crawler is equipped with a wireless gas detector that can send alerts up to 985 feet (300 metres) away if gas were to be detected in the area. | Photo: BP 360-degree views around the entire pipe, but also the imagery included useful information for surrounding structural elements” and judging from the attached video on their website, manoeuvring the robot is a piece of cake – they just use a game controller. The tech specs are even more interesting. Their crawler features a high definition camera and rare-Earth magnets and since no electromagnetics are used in the inspection, a power cut would not affect it in the slightest. Regarding the drone, it is built with a high-performance processor in charge with maintaining flight controls, plus a stabilized highresolution camera for those blinks and you might miss it details. With a flight capacity ranging from five to eight meters from the piping, the powerful lens comes in handy when you need to zoom in on something. Work security is still the norm so the crawler also comes equipped with a wireless gas detector which can send alerts up to 300 meters in case of danger. If this wasn’t enough, the drone carries an optical gas imaging camera and the team themselves use a gas imaging camera on the platform’s catwalk to monitor activity. Testifying to BP’s devotion to stateof-the-art technology is the drone itself; Dave Truch advocates that not any common drone can take on this task,

even high-end commercial drones might not be enough for the job with chosen few being able to handle it. But it’s worth the price of admission according to Bill Broman, subsea operations manager: “We collected a much larger volume of data that was significantly higher quality. The high-definition cameras on the drone and crawler enabled us to get continuous feeds of the imagery, rather than a series of slices.” Seeing the bigger picture surely has its benefits, just compare several weeks of work to a couple of hours. With such a resounding success we can be sure this will be implemented to other platforms in the future. Still, BP states this is just the beginning. They have also mentioned using the crawler for their downstream operations, namely the Cherry Point refinery in Washington where the hydrocracker reactor is inspected for microscopic cracks via ultrasound technology. The crawler does this in one hour, as opposed to 23-man hours during a planned shutdown. I believe the benefits speak for themselves. Things like safety and efficiency were also mentioned by Torgeir Olsen of Odfjell Well Services in his interview with the magazine in March of 2017. Also touching on the importance of digitalization and its implementation, 49

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he hinted that the sky might not actually be the limit since robots may be used to drill on Mars too. Since then, Odjfell and Statoil (now Equinor) have sold their shares in Robotic Drilling Systems (RDS) to Nabors Industries. Along with the sale came a Memorandum of Understanding which establishes cooperation between Nabors and former shareholders in order to still have access to robotic technologies. Nabors now feature the Canrig® drilling equipment brand which combined with their Rigtelligent™ operating system, provides companies with improved efficiency and drilling performance. Their Electric Drill Floor Robot has a 1500-kilogram load capacity and automates all pipe and tool operations with the help of various automated grippers, spinners, clamping and seven axis motions. Since it’s all integrated, the robot can seamlessly transfer power and communicate with other rig components. Also, given the built hardware controls and standard electric components it makes for an easy installation and low maintenance. Another one of their heavy hitters is the Electric Robotic Roughneck which features 270 kNm of torque and provides full control of all parameters when dealing with drill pipes and casings. It also comes with a triple grip torque wrench with high accuracy control and 120 degrees total rotation per grip. Coming to prevent incidents caused by pipe handling or dropped objects is the iRacker® offered in electric and hydraulic-powered units. With its autonomous tubular handling system, it enables completely handsfree pipe handling and weighs each pipe, measures tubular lengths on the catwalk and determines the tubular diameter for the mouse hole and power slips. It can be easily installed into any AC Rig and has perfect connectivity with the Rigtelligent™ control system, giving the driller full control over all drill rig operations from his cabin. Equinor is also kind enough to present a robot collection of their own. Eelume, the snake like robot is a type of underwater intervention vehicle which 50

With a 1500 kilogram load capacity, the fully electric drill floor robot automates all pipe and tool operations to reduce the need for manual labor on a rig’s drill floor. | Photo: NABORS

Eelume vehicles are basically self-propelled robotic arms whose slender and flexible body can transit over long distances and carry out inspection, maintenance and repair in confined spaces not accessible by conventional underwater vehicles. | Photo: Eelume uses thrusters to swim around subsea installations. Its main attributions are turning valves on and off and filming pipelines to check for faults and does so effortlessly due to its shape and increased flexibility and manoeuvrability. It also features enhanced customization possibilities given its modular build. Weather conditions are no object and the Eelume can dwell indefinitely on the seabed. A long-time in the making, Hugin seems to be the ultimate

autonomous underwater vehicle given its hydrodynamic shape, accurate instruments and excellent battery capacity. As the fastest and most accurate seabed mapping device, it’s a staple of any major oil field enterprise on the Norwegian continental shelf. Featuring complete autonomy, no cables or remote control needed, it also sports a gyroscope, axelrometer, Doppler legs, echo sounder and sonar systems. It’s so good at finding small objects underwater that it has also been used in mine hunting. energyindustryreview.com

OIL & GAS

E-ROV. | Photo: Equinor

The HydraTong™ ARN models lets the drill floor remain trackless due to the articulated arm design. | Photo: National Oilwell Varco

This robot can clean tube heat exchangers without having to stop production. This is not only safer and cheaper, but also more environmentally-friendly. | Illustration: Equinor/Anders Røyrøy

Since we’re talking about digitalization, welcome to E-ROV (Empowered Remotely Operated Vehicle), the so called ‘Tesla-submarine’ which can be controlled from anywhere in the world courtesy of a fast Ethernet connection. This is possible thanks to Equinor’s installation of a fast 4G network on the Norwegian Continental Shelf, with the E-ROV receiving and transmitting via a buoy on the surface. Having an on-board battery and available subsea charging station makes the submarine independent, racking in cost, time and environmental advantages. National Oilwell Varco brings their own version on the Iron Roughneck called The HydraTong ARN which features full drilling process automation. The robot comes with integrated tools such as automatic bouncers, mud buckets and high-resolution cameras with fast image processing to streamline the drilling process making a manual operator obsolete. Last but not least we may talk about the HX Cleaning robot. Given the task to clean and inspect tube heat exchangers on platforms and onshore installations it will be able to do so without the added inconvenience of having to stop production, because as we know it, time is money. Since no human labour is involved this means fewer accidents and since chlorine has been swapped for high pressurized water, the robot is also environmentally friendly. All these are but a few examples, there’s no telling what engineers have cooking up in their labs and what prototypes will hit the shelves in the world of tomorrow. With digitalization slowly becoming the norm who knows what will surprise us next. In 20-30 years, the innovations of today will likely seem as something usual and we’ll be wondering how we ever handled these jobs without the help of robotic assistants. But in order for that fantasy to come true we need to accept it and realize its importance today. Some companies have already joined in on the phenomena. The others might have to pay a dear price for passing on this opportunity. 51

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ENERGY EFFICIENCY OF BUILDINGS

Thousands of local plans for a common goal Daniel Lazar

he final conference organized T within the European EmBuild project: ‘Energy efficient buildings - Thousands of local plan for a common goal’ has recently taken place in Belgrade. The event aimed at how localities can become the trigger that can make possible achieving the European objective on building stock in Europe. This conference has been an opportunity to present and discuss the evolution of European Union’s policies on energy efficiency and support financing of investments in the field; also, to present the support provided by the Energy Community, share best practice experiences of mayors in the region, involve political decision-makers and stakeholders in an informed discussion regarding the methods for replicating successful renovation strategies; identify and discuss the non-energy benefits of major renovation. The conference brought together local and national authorities from SouthEastern Europe, representatives of the energy community, experts in energy efficiency and not only, who have debated 52

interesting topics on energy efficiency, while comparing the methods for the implementation of measures provided in the EmBuild project in their countries. Until last year, international experts have reported new investments of approximately EUR 174mln in Energy Performance Contracting (EPC) in Croatia, Germany, Slovenia and Romania. In this context, 27 new EPC contracts have already been signed during the two years and other 20 EPC projects are in various stages of development. The EnPC-INTRANS project is supported under the EU Horizon 2020 Program, and the project partners are from Croatia, Germany, Greece, Latvia, Romania, Serbia, Slovakia, Slovenia and Ukraine. The project’s objective is to provide the local experts and players in these countries with information and know-how on the application of Energy Performance Contracting (EPC) in public buildings. On more than 3,000 occasions, over the past two years, local experts and players in nine European countries have decided to participate in the information

and training activities organized by the project partners. The projects include all types of public buildings and groups of buildings within universities or hospitals, to administrative buildings, public pools or schools and kindergartens. Following these investments, energy savings generated are expected to amount to approximately 80 GWh per year. This means the equivalent of total annual electricity consumption for 20-25 residential buildings in Germany. The positive feedback that the EnPCINTRANS project has received from the participating experts and from local players is a proof that the entire European cooperation in the field of energy performance of buildings can create a substantial impact in outlining the energy future of Europe, in line with the European Energy Efficiency Directive (EED) of 2012 and the European Buildings Performance Directive (EPBD) of 2010. These European Directives highlight in particular the empowerment of the public sector to be a model for the further implementation of energy efficiency measures in buildings. energyindustryreview.com

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European cooperation on EPC in public buildings also contributes to the Energy Roadmap program of the European Commission from 2011, which aims to reduce greenhouse gas emissions by 8095% compared to 1990, by 2050. Public authorities are motivated, but lack funds for investments in the energy efficient rehabilitation of public buildings. Cooperation with private investors and with energy service companies (ESCOs) qualified in EPC business models can help overcome this barrier. Confidence in long-term business relations based on EPC models is still poor, both among public buildings owners and private investors. The starting point for EPC in public buildings, creating confidence in EPC business models especially in the

emerging markets, can be the so-called EPC light business models based on service concepts that avoid large-scale investments in a first stage. EPC light projects are usually amortized in just 2 to 4 years of guaranteed energy savings. In the more advanced markets, EPC plus concepts can apply measures by improving energy efficiency included in complete renovation packages. These packages can include remodelling and thermal insulation of the building envelope, rehabilitation of structures, interior modernization and replacement of installed equipment. Such complete investment packages are not usually amortized from guaranteed energy savings over a reasonable period of time. However, the integration of EPC models in the investment plans can help reduce

the financial burden and investment risk for building owners. ESCOs can guarantee the achievement of a certain level of energy savings, as well as the installation, operation and maintenance of equipment installed throughout the duration of the EPC contract and after. New investments generated during the two years of implementation of the EnPCINTRANS project include all types of EPC business models. Project partners agree that, when they are implemented successfully, the new projects can serve as best practice examples. They will generate the subsequent dissemination and replication of EPC business models in public buildings, thus creating a new boost for the further absorption on the market of Energy Performance Contracting in the public buildings sector.

Steder Group in Romania is Your link to the world of Energy sector in the Black Sea Region for Transport, Logistics & Storage

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Damen shipyards Galati hands over 74-metre fishery research vessel to Angolan government Damen shipyards Galati has made provisional delivery of the 74-metre Fishery Research Vessel Baía Farta to the Angolan Ministry of Fisheries. The Damen FRV 7417 type vessel was ordered in July 2016 and officially launched in November 2017. It will remain in Galati until November, when it will set sail for Angola where the final delivery will take place. ith a 1,600 km Atlantic coastline, W the development of the domestic fishing industry is a priority of the Angolan government and it currently employs over 100,000 people in both commercial and artisanal fishing. The Baía Farta is equipped for the full range of fisheries research and assessment activities including hydrographic operations, acoustics research, pelagic and demersal trawling, plankton, water, environmental and geographical sampling, oil recovery and emergency towage operations. To maximise her effectiveness in her role, the Baía Farta has been built to Silent-A/F/R Class notation standards. Every care has been taken in her design, construction and outfitting to minimise underwater noise as well as onboard internal acoustic noise and vibration. The rigidity of foundations and supports for all potentially noise and vibration-generating components and systems are being thoroughly checked to ensure that they comply with the Silent notation. Expertise from Damen Shipyards Gorinchem and Damen 54

Attendees at the handover ceremony of the Baía Farta at Damen Shipyards Galati. | © Damen Schelde Naval Shipbuilding has also contributed to the development of this sophisticated vessel. “Over the next few weeks the Angolan team will be taking the Baía Farta through its final tests and checks before they head out into the Atlantic for their voyage home,” says Friso Visser, Damen Regional Director Africa. “We are confident that she will prove to be a

highly efficient and effective vessel, and will in the years ahead play a valuable role in the development of the Angolan fishing industry.” The Angolan Ministry of Fisheries and Damen have worked together in the past, with Damen having supplied two, 62-metre, FRV 6210 Fishery Inspection Surveillance Vessels and a smaller Fishery Research Vessel (FRV 2808). energyindustryreview.com

ROM WELD CONCEPT ROM WELD CONCEPT is a Romanian company with privately owned capital, established in 2013, having as main line of business the manufacturing of metal constructions and metal parts. Laurentiu Dogeanu, manager of the company, is permanently focused on market requirements and aims to satisfy customer needs by providing services in accordance with the national and international standards in force, in compliance with the rules of safety and quality of construction and environmental protection. ROM WELD CONCEPT team is the ideal partner for executing and installing works of: • Small and medium complex metal constructions, machined parts; • Pipe constructions and process flows; • Stainless steel process flows; • Pumping units; • HVAC and refrigeration installations; • Tanks up to 10,000 L for all areas of activity; • Special automatic welding; • Powder coating, ‘hot and cold’.

ROM WELD CONCEPT also provides customers with a wide range of highquality services: • Manual welding for repairs, joints, refurbishments and wear protection loads applications; • Repair and maintenance of buckets, arms, clumping system boring; • Consultancy and design for the execution of a wide range of buckets, as well as the modification and adaptation of the existing ones; • Welding repair of crusher and rotary mill wear parts. The dynamics and performance of ROM WELD is supported by both the team of employees and the technology used to perform the works. Rom Weld execute works both in the workshop and on the site and has automatic welding equipment. Meeting contractual obligations with promptness and fairness and compliance with the budget and timeframe required make ROM WELD a reliable and performing partner, able to carry

out projects through close coordination and high-quality execution. The open, cooperative and honest attitude towards its clients, suppliers and subcontractors, the successful fulfilment of the tasks and commitments assumed, as well as the promptness of response for solving the various problems that arise during the production activities are realities that have led to the continuous growth of the company’s turnover and consolidated ROM WELD’s position on the Romanian profile market.

SC ROM WELD CONCEPT SRL 257 Soseaua Bucuresti St., Ciororgrala, Ilfov County office@romweld.ro www.romweld.ro

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Â© Valparaiso Hotels

THE CHILEAN EXPERIENCE

Hotel made 100% of recycled materials Daniel Lazar

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official delegation of the An Government of Romania conducted, during 16-21 October 2018, an official visit to the Republic of Chile. The delegation was led by Gratiela Gavrilescu, Deputy Prime Minister and Environment Minister, its main purpose being to strengthen the diplomatic and commercial relations between the two countries. The official visit included high-level reunions with ministers from the Sebastián Piñera Government, the leadership of the two Parliament chambers, lawmakers, ambassadors and other members of the diplomatic corps, businessmen and representatives of local public authorities. “In 2018 we celebrate 107 years of continuous diplomatic relations between Romania and Chile. It is the Latin-American

state with the greatest economic growth and holds a special geostrategic position. At the same time, this country with a unique natural capital, part of the UNESCO World Heritage, is facing numerous environmental problems. Considering all these aspects, I believe the organization of this first high-level government delegation in the last decade is an opportunity that could benefit both states,” Gratiela Gavrilescu said. The Romanian dignitary had a meeting with the Environment Minister of Chile, Carolina Schmidt Zaldivar, the two ministers signing a bilateral Memorandum of Understanding in the field of environmental protection. “Together with Minister Schmidt we decided to lay the foundations of our inter-institutional collaboration in fields such as fighting climate change, protection of biodiversity and waste

management. Moreover, the Chilean side has requested our support in the creation of a national institution to manage the protection areas, taking into account the experience acquired by our country in the process of setting up the National Agency for Protected Natural Areas,” the Romanian Environment Minister mentioned. A special moment of the program was the visit of the delegation to the only hotel in Chile made 100% of recycled materials. Hotel WineBox in Valparaiso is made up of 25 metal containers and the entire furniture is made of recycled wood, glass and metal packaging. Even the sound and thermal insulation of the rooms is made of recycled newspaper. In its interior 21 rooms were enabled, 19 of which have 40 square meters and other two of 100 meters enabled. The containers were projected in a height of four floors and each piece was conditioned with bathroom, kitchen, living room, balcony and a splendid view of the sea, the city and the port of Valparaiso. The project was an idea of the New Zealand winemaker based in Chile more than a decade ago, Grant Phelps, who also devised an architecture inspired by ships, the port, the sea, travel and wine. “WineBox has a wine bar that offers Chilean wines for bottles and glasses, while in another container, the store is located.” “We made much of the decoration and furniture with recycled elements, and we are implementing future projects that incorporate the use of solar and wind energy, as well as the recovery of graywater to further reduce the carbon footprint, transforming it into a fully sustainable project,” says its owner. “I wanted to visit this hotel, as it sets an example of sustainability. It fits perfectly into the concept of circular economy that we want to promote and implement in Romania. Such an approach brings many advantages: low cost of materials, relatively short execution time and attraction of many tourists who want to be accommodated in such an unusual place. Thus, it takes only vision and creativity to perfectly combine economic and environmental advantages,” Gratiela Gavrilescu pointed out. 57

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Marius Chiriac, Director Enel X Romania | ÂŠ Enel

The biggest electric mobility plan in Romania Enel x announces the installation of 2,500 charging units and investments of up to eur 20mln â&#x20AC;˘ Enel X Romania has been created to provide innovative solutions, with added value, adapted to the needs of individual consumers, companies and municipalities â&#x20AC;˘ Charging points provided for in the electric mobility plan will be installed, as of 2019, in all regions of Romania, on the main roads in the country, as well as in most major cities, starting with Bucharest, Timisoara and Constanta 58

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nel X Romania, a company member of Enel X, the E Enel Group’s advanced energy services division, was officially presented on November 13 and launched the biggest plan for the development of electric mobility infrastructure in the country. The plan aims at the installation of about 2,500 charging points in all regions of Romania, during 2019-2023, following total investments of EUR 1520mln. “Enel X Romania commits to provide owners and fleets of electric vehicles with the possibility to travel across the country, from north to south and from east to west, without worrying about where they will find the next charging point. Through this ambitious plan for the development of an extended charging infrastructure in the following five years, we will contribute to a cleaner and more sustainable transport throughout Romania,” Marius Chiriac, Director of Enel X Romania, said. The first charging points will be installed in 2019 in Bucharest, Timisoara and Constanta. The plan covers all areas of Romania, so that the positioning and installation of the charging infrastructure be adapted to increasing the degree of utilization of electric vehicles at the level of households, institutions, as well as among companies, as a result of demand for fleets. About 300 charging points will be installed in 2019. Enel X Romania will provide the service of installation of charging infrastructure to ‘Recharging Partners’, such as commercial centres, supermarkets, restaurants and hotels that want to attract electric vehicles users. The installation and maintenance of the charging infrastructure does not involve costs for Recharging Partners, in exchange for making available parking places. The company provides a similar service to municipalities interested in improving air quality by encouraging electric mobility. Enel X Romania will support local authorities to identify the best solutions, and then will install the charging infrastructure and ensure its maintenance without costs for municipalities, on the parking spaces on the public domain. The infrastructure that will be developed in Romania is based on new, smart charging solutions of Enel X global division. These are modular, scalable equipment, which can be delivered ‘turnkey’ to individual consumers, companies and institutions. Installation of stations with powers of 22 kW (Quick), 50 kW (Fast) and over 150 kW (Ultrafast) is provided. The new products are part of the recently launched range ‘Juice Family’: • JuicePole: charging station to be installed in cities, facilitating the charging experience with the new screen and integration with Enel X Recharge application. It can ensure the simultaneous charging of two vehicles, through alternative current, and is equipped with the latest connectivity technology. Juice Pole can be activated with Enel X Recharge App, which allows users to identify a

JuiceBox | © Enel nearby station, to book a charging point and to monitor battery charge in real time via the mobile phone. • JuiceBox: the new box-type station that can be installed in individual homes, also being available in commercial version for charging fleets. • JuiceLamp: solution created by Enel X integrating the public lighting infrastructure with the charging infrastructure. This is a ‘smart LED lamp’ that, besides ensuring a high efficiency and remote control, provides the possibility to charge two vehicles at the same time. JuiceLamp is also configured for video surveillance, air quality monitoring, connectivity via optical fibre or urban Wi-Fi. In relation to long-term partners, Enel X Romania can: - Help companies analyse fleet operation data by delivering tailor-made charging solutions for vehicles, based on customer specific needs; - Provide a complete instrument for the management of the charging infrastructure, Recharge Manager; 59

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JuicePump | © Enel

JuicePole | © Enel

- Extend the infrastructure depending on the fleet needs: JuiceStation is a competitive and efficient solution, allowing companies to connect a number of Juice Boxes, in the commercial version. Enel is a multinational energy company, one of the integrated leaders on the global electricity, natural gas and renewable energy markets. Enel is one of Europe’s largest utilities in terms of market capitalization and one of the leading electricity companies on the continent in terms of installed capacity and EBITDA reported. Enel Group operates in over 30 countries around the world, with a net installed energy capacity of about 89 GW. Enel distributes electricity through a network of over 2.2 million kilometres, has about 73 million household and corporate customers around the world, representing the largest customer base compared to European companies in the field. The renewable energy division, Enel Green Power, operates production units with an installed capacity of 43GW from wind, solar, geothermal and hydro power sources in Europe, the Americas, Africa, Asia and Australia.

Enel X is a new global division of Enel, dedicated to the development of innovative digital products and services in the fields in which energy has the greatest potential of transformation: cities, housing, industries and electric mobility. Enel Romania is one of the largest private energy investors, with operations in the electricity distribution and supply sector, as well as electricity generation from renewable sources, present on the Romanian market since 2005. Enel has 3,100 employees in Romania and provides services to 3 million customers. E-Distributie companies operate networks with a total length of approximately 128,000 kilometres in three important areas of the country: Muntenia South (including Bucharest), Banat and Dobrogea, covering one third of the local distribution market, and develops an investment program for the improvement of service quality, network safety and performance and local implementation of Enel Group’s environmental standards. Enel Energie and Enel Energie Muntenia have important energy suppliers in Romania, offering both electricity and gas, as well as services with added value.

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Largest tidal power plant in the world with hydraulics from Bosch Rexroth

In the world’s largest tidal power plant Sihwa-ho in the Republic of Korea, ten pipe turbines create an electrical output of 254 megawatts with the help of Bosch Rexroth turbine regulating units. This quantity of electricity, created with no emissions, corresponds to that used by a city with half a million inhabitants. And the power plant wasn’t even originally in the plans. The South Korean government had constructed a dam in the bay, located on the country’s west coast near Seoul, as a land reclamation project with a fresh water lake. However, the water quality in the coastal lagoon became so poor that it was necessary to allow for a water exchange with the ocean. The national water authorities decided to

combine the needed project with something useful: if they were going to have to drill holes in the 12.7-kilometer-long dam, then these could also be used to generate power. Under the general contractor Daewoo Engineering and Construction Co., Andritz Hydro delivered ten pipe turbines. To regulate water flow for the turbines, Bosch Rexroth acted as a systems partner, constructing and producing ten custommade hydro power units for turbine regulating within one year in Austria. These units adjust the guide vanes and runner blades of the turbines so that the turbines are producing the maximum output over the entire tidal range (up to 8 meters). The Rexroth aggregates use a bio-degradable hydraulic fluid that places unique service

life requirements on the components. The hydroelectric power station hasn’t just been reliably delivering electricity since its commissioning in 2011, it’s also restored the original water quality level, allowing a quarter of the water in the lagoon to be exchanged during every tide.

Bosch Rexroth Romania 2 Aurel Vlaicu Street, 515400 Blaj Tel. +4 0258 807 872 sales@boschrexroth.ro www.boschrexroth.ro

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Photograph of a Nissan Leaf | © Nissan

EDF Energy and Nissan partner to advance low carbon transport The UK’s largest producer of low-carbon electricity and one of Britain’s leading car manufacturers are joining forces to work together on a number of projects that will support the adoption of electric vehicles and energy generation and storage solutions. 62

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• Partnership to explore combining Nissan second-life electric vehicle (EV) batteries with EDF Energy’s demand side response platform, PowerShift. • Millions of second-life EV batteries could be used to supply electricity to the grid and cut Britain’s carbon emissions. • Agreement also covers future collaboration across smart charging, batteries, decentralised generation and grid integration over the coming years. issan and EDF Energy, the N manufacturer’s long-term UK supplier, signed the new agreement in Paris on October 10. The partnership will kick off with a first of its kind collaboration to explore how second-life Nissan electric vehicle (EV) batteries can support demand side management. Both EDF Energy and Nissan have been at the forefront of developing the market for electric vehicles in the UK and will bring substantial technical expertise to the wide-ranging agreement that will support the transition to low carbon transport, such as smart charging, batteries, decentralised generation and grid integration. The first joint project will see the partners explore the business case for recycling retired batteries from Nissan LEAF into commercial battery storage. The system would see electricity stored in the batteries and released back to the grid using EDF Energy’s PowerShift to react quickly to demand side response (DSR) initiatives. Storage systems offer a lower carbon solution compared to relying on coal and gas power stations to meet peaks of electricity demand on the grid. The combined system will be trialled to see how it can support on site generation, greater control and flexibility over energy use, and provide additional revenue streams. Already this year, there are more lithium-ion batteries being installed in electric vehicles than into consumer electronics and demand for electric mobility is only expected to increase, equating to millions of used electric vehicle batteries being available for the energy storage market. These batteries

have as much as 70 per cent of their original capacity and will still have more than 10 years of remaining life. “The transition to Electric Vehicles provides huge opportunities for businesses and households, which is why we are investing in the best technology and products to help consumers and business realise the associated benefits. In partnering with Nissan, we’re excited to explore new technologies and business models to make low carbon transport a reality now and for the future,” Béatrice Bigois, Managing Director of Customers at EDF Energy, said. “We are delighted to be entering this partnership, which will see Nissan’s Intelligent Mobility strategy continue to support the expanding electric vehicle market and help create a more sustainable energy future in the UK. We believe electric cars are just the start, and our second life programme ensures batteries from our cars continue to provide energy storage capacity in other applications – in houses, businesses, football stadiums even – long after their life in cars. It’s an exciting prospect and we look forward to working closely with EDF Energy on these developments in future,” Francisco Carranza, Director of Energy Services, Nissan Europe, mentioned. This partnership comes as EDF President Jean-Bernard Lévy detailed the Group’s strategic plans on electric transport this morning, including its plan to be the leading energy company for EVs by 2022 across its four largest European markets: France, the United Kingdom, Italy and Belgium. EDF Energy is the UK’s largest producer of low-carbon electricity, meeting around one-fifth of the country’s demand and supplying millions of customers and businesses with electricity

and gas. It generates electricity with eight nuclear power stations, more than 30 wind farms, one gas and two coal power stations, as well as with combined heat and power plants. EDF Energy is leading the UK’s nuclear renaissance with the construction of a new nuclear power station at Hinkley Point C. This will provide low carbon electricity to meet 7% of UK demand. The project is already making a positive impact on the local and national economy, British industry, as well as boosting skills and education. EDF Energy also invests in a range of low carbon technologies including renewables and battery storage. It is applying research and development expertise to improve the performance of existing generation and developing the potential of new technologies. The company provides gas and electricity for more than 5 million customer accounts and is the biggest supplier of electricity by volume in Great Britain and the largest supplier to British businesses. It offers innovative energy systems for commercial customers and digital innovation for customers at home. EDF Energy has also launched its own innovation accelerator, Blue Lab, which focuses on making customers’ lives easier. The Better Plan is EDF Energy’s framework for being a sustainable and responsible energy business and is an integral part of EDF’s 2030 vision to be the efficient, responsible electricity company, and champion of low-carbon growth. The Better Plan is underpinned by comprehensive environmental and social programmes which have been recognised by a wide range of organisations. 63

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he automotive industry is in T transition, with materials light in weight and the end product increasingly propelled by electricity. This means new challenges when it comes to joining techniques. The ongoing efforts to fight climate change is having an important impact on the automotive industry. Breakthroughs in battery technologies in combination with various governmental initiatives are driving a change from fossil fuels to electric cars. Another important objective is reducing the weight of vehicles. For traditional cars, this is a key factor for reducing CO2 emissions. The heavier the car, the more fuel it will consume. Since range is an issue for electrical vehicles, and the weight of batteries is considerable, there is also a big incentive to find ways to make these cars as light as possible. Both of these factors push increased use of lightweight materials such as aluminium, carbon fibre composites and high-grade steel. The immature state of the technology means that new concepts and models are being developed all the time. Companies invest in smaller, more flexible plants with the ability to quickly change or adjust lines of production. “We understand that our customers in the automotive industry are facing major challenges with developing their processes and techniques,” says Nicklas Tibblin, Vice President Marketing at Atlas Copco 64

Industrial Technique. “To achieve flexibility, you need to have equipment optimized for change. You want to eliminate as much hardware as possible. Atlas Copco’s range of battery-powered tools allows customers to get rid of controllers, which makes a transition much faster and easier. Also, the connected, smart tools we provide can help the operator quickly adapt to a new process, since the tool will help you do things in the right order.” The increased use of new materials also means that car manufacturers must come up with new assembly processes. Joining steel to aluminium and fixing composites to aluminium in a secure way can call for new equipment and solutions. One focus is on developing new rivets and riveting methods for joining high-strength steel and ultra-high-strength steel to highstrength aluminium. “It is key for us to be fast and adjust our R&D to shifting trends,” says Andreas Kiefer, Vice President Business Development at Atlas Copco Industrial Technique. “Our advantage is that we are a one-stop shop within technologies for joining and fastening. We cover all of them and have an incredible experience and knowledge in this area. Understanding the customers’ full process, we can support them even within research and development.” A flagship technology is the fully tubular rivets developed for riveting three or four layers of high-strength 6000 series aluminium alloys. The tubular rivet range is currently being expanded to cover a

The lightweight, electric future of cars

wider range of joining solutions, such as smaller-diameter rivets for joining narrower flange widths to reduce the amount of sheet metal employed and increase interior cabin space. Another example is leading expertise in adhesive bonding technology, which can be used in addition to traditional welding to help lower the overall weight of automobiles. The rise of electric power trains also creates new joining needs connected to battery manufacture and assembly. Batteries become an integrated part of the vehicle structure, and lithium ion cell assembly is safety-critical. In every step of the assembly process you have to use smart and secure joining technologies. “Atlas Copco has found innovative ways of handling all types of joining within the battery pack,” Tibblin says. “One of our most important strengths is our capability to work directly with our customers in this way. We are familiar with their assembly processes, we know the best practices and can supply them with a lot of knowledge in their production.” energyindustryreview.com

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Romania’s primary energy resources on the rise In the first three quarters of this year, primary energy resources went up 1.4%, and electricity resources increased by 0.1% compared to the same period of 2017, according to data published by the National Institute of Statistics (INS). Thus, the main primary energy resources during 1 January - 30 September totalled 25.538 million tons of oil equivalent (toe), climbing by 346,800 toe compared to the similar interval last year. Domestic production totalled 15.662 million toe, down by 136,000 toe year-on-year, and import stood at 9.876 million toe. Daniel Lazar

the same period, electricity resources amounted to 49.999 In billion kWh, advancing by 52.7 million kWh compared to the corresponding period of 2017. Production in power plants was 18.910 billion kWh, falling by 1.54 billion kWh (-7.5%), in hydropower plants - 14.813 billion kWh, increasing by 3.695 billion kWh (+33.2%), and in nuclear power plants it stood at 8.331 billion kWh, down 1.6%, i.e. 134 million kWh. Production in wind power plants amounted to 4.695 billion kWh, decreasing by 727.4 billion kWh compared to the first nine months of 2017, and solar energy produced in photovoltaic plants was 1.420 billion kWh, declining by 195.2 million kWh. Final electricity consumption in this period was 41.479 billion kWh, by 1.9% higher than in the corresponding period of 2017, while public lighting recorded a decrease by 5.1% and household consumption fell

by 12.2%. Electricity export amounted to 4.346 billion kWh, down by 676.8 million kWh, and own technological consumption in networks and station was 4.174 billion kWh, falling by 52.3 million kWh. At macro level, economic growth recorded by Romania in the first nine months of this year was 4.2%, both as unadjusted series and in seasonally adjusted terms, compared to the similar period of 2017, and compared to the second quarter of 2018 the Gross Domestic Product was, in Q3, in real terms, higher by 1.9%, according to INS data. Reported to the same quarter in 2017, GDP recorded in Q3/2018 an increase by 4.3% as unadjusted series and by 4.1% in seasonally adjusted terms. The National Forecast Commission (CNP) reviewed downwards, to 4.5%, its estimates regarding economic growth this year, from 5.5% forecasted in July, in the intermediary summer version. It also reviewed downwards (by 0.2 percentage

points) the estimate for 2019, to 5.5% from 5.7% in the previous forecast. For the following three years, figures regarding the advance of the Gross Domestic Product remained unchanged, at 5.7% in 2020 and 5% in 2021 and 2022. In turn, the European Commission (EC) significantly reviewed downwards its estimates on Romania’s economic growth in 2018, from 4.5% to 3.6%, while in 2019 it relies on an increase by 3.8%, compared to 3.9% estimated in spring, according to the autumn economic forecasts published a week ago by the Community Executive. For 2020, the Community Executive indicates an advance of 3.6%. The International Monetary Fund (IMF) also reviewed downwards, in early October, its estimates on the evolution of Romania’s economy, for both this year and the next, following the moderation of incentives underlying the robust growth recorded in 2017, according to the latest World Economic Outlook. 65

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EximBank to provide EUR 32mn financing for Romelectro

EximBank has granted Romelectro, one of biggest EPC contractors for energy projects, a credit facility worth 150 million lei (EUR 32mn), destined for funding ongoing projects in Romania and abroad.

he credit facility includes a T financing component covering temporary cash needs, as well as letters of bank guarantee, and will provide the company with the necessary funding for the execution of ongoing contracts in Romania as well as international markets. “This cooperation with Romelectro started four years ago is important to us as it 66

constitutes a showcase of the crucial role that EximBank may play in implementing the expansion plans of Romanian companies. With EximBank as main financial partner, Romelectro has succeeded expanding its project portfolio with several large domestic contracts, as well as extending and consolidating its presence on highly competitive external markets. It is proof that

any company that has by its side a bank that understands its demands and adapts to its needs, as does EximBank, will soon meet with success” declared Traian Halalai, President of EximBank. In the last few months alone, Romelectro has signed contracts with Transelectrica (the Romanian Power Transmisssion System Operator) for energyindustryreview.com

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the refurbishment of several electrical substations (Focsani Vest, Roman Nord, Bacau Sud, Smardan, Craiova and Medgidia), worth in total over EUR 50 million. Also, the refurbishment of Bradu 400/220/110/20 kV substation is in its final stages, as well as the investment in multiple 220 and 110 kV overhead transmission and distribution lines in Kosovo. In the field of power generation, Romelectro is leading the refurbishment projects for the hydroelectric power plants Stejaru on the River Bistrita and Slatina on the River Olt, worth in total around EUR 80 million, as well as several refurbishment programs for the coal fired thermal power plants which belong to CE Oltenia. In 2016 Romelectro signed, in partnership with a Spanish company,

the contract for the building of a new 430 MW combined cycle power plant in Iernut, with Romgaz as investor, with a total worth of EUR 250 million. Another prestigious achievement by Romelectro in the power generation field, in partnership with SAEM Energomontaj, is the execution and successful commissioning of the 1200 MW Unit 1 on natural gas of the Burullus thermal power plant in Egypt. „Romelectro’s evolution in the past few years has consolidated our position as the most important EPC contractor of strategic energy projects in Romania. The company is currently undergoing a very favourable time, having succeeded in winning, beside projects abroad, tenders held by national companies for highly complex energy projects. In all these projects Romelectro attracts many Romanian

engineering, manufacturing, construction and assembly companies, in its mission to become a hub for promoting Romanian industry at home and on international markets. In such approaches we need solid financial partners, with expertise in financing complex industrial projects, being familiar with the Romanian market specificity. EximBank is for us such a partner and we wish to continue to benefit in the coming years from this cooperation,” said Viorel Gafita, President of Romelectro. In order to continue growing its portfolio of energy investments in Romania, and knowing well their volume and trends on the international market, Romelectro will continue its policy of consolidation of its position as general contractor for complex projects through the leverage of the potential of Romanian professionals and companies.

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Pillar II private pension funds attracted by the energy sector Daniel Lazar

nvesting in shares issued by I energy, oil and gas companies has become a target of those who manage Romanians’ money. Thus, Metropolitan Life Pensii Private, managing RON 6.5bn, increased in H1/2018 its exposure on OMV Petrom, Romgaz, Transgaz and Sphera Franchise Group and thus reached total investments of RON 1.26bn in 18 companies listed in the Romanian stock exchange, according to data from the half-yearly report. “Companies in the energy sector have solid economic foundations, able to generate dividend values above the average of developed markets and with prospects of benefiting from the global evolutions on the energy markets,” Oana Velicu, CEO of Metropolitan Life Pensii, has mentioned. Romanians have 17.8% lower amounts in their personal Pillar II private pension account, due to failure to comply with the Law no. 411/2004 on privately managed pension funds, and the impact in this chapter, i.e. unpaid contributions, is EUR 1.9bn, Radu Craciun, President of the Association for Privately Administered Pensions in Romania (APAPR), claims. Compared to December 2017, the exposure of the fund managed by Metropolitan Life Pensii Private climbed by 5%, amid the share accumulation 68

process, but also as a result of appreciation of certain shares in the portfolio. On the other hand, the Pillar II manager has diminished slightly its exposure on SIF3 and SIF4, remaining with the same companies in the portfolio as at the end of last year, being one of the seven Pillar II funds in Romania with full exposure on the Bucharest Stock Exchange in the equity investment segment. Probably the full investment in BSE was the basis of the annualized rate of return of 4.3% in September 2018, the highest among the seven Pillar II funds, in the context in which the Romanian stock exchange has been the second most performing in the European Union in the first nine months of this year, according to Bloomberg and Financial Supervisory Authority (ASF) data.

90% OF INVESTMENTS IN THE ROMANIAN ECONOMY Radu Craciun believes that the reduction of contribution paid to Pillar II from 5.1% in 2017 to 3.75% in 2018 means a decrease in individual contributions by 12% for participants that have not benefited from salary increases in 2018. However, due to salary growth in the economy, especially in the

public sector, and the higher number of newcomers, total contributions paid in 2018 (APAPR estimate) to Pillar II are by around 8.5% above the level in 2017. Pillar II and Pillar III private pension funds have total net assets of over EUR 10.4bn, more than 90% of these assets being invested in the Romanian economy. Pension funds currently own about 18% of Romania’s government bonds, i.e. about 7% of the public debt of the country. On the Bucharest Stock Exchange (BSE), pension funds own EUR 1.7bn, about 20% of the freely traded shares, ensuring about 15% of liquidity. Radu Craciun says that everywhere in the European Union private pension funds play an important role in longterm financing of economic growth and job creation. The European states with a well-developed private pension sector tend to have stronger capital markets. Investments of pension funds in listed shares vary between 15% in Germany to almost 40% in countries such as France, the Netherlands and Finland. In Romania, the rate is around 20%.

MEN, MORE CONCERNED ABOUT PLANNING RETIREMENT YEARS Women are more concerned about energyindustryreview.com

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savings than men, but they manage to save a lower percentage than them, according to a study conducted by OTP Bank Romania, through the Right to Education Foundation. According to the results, the main concern of men is the standard of living during retirement, while a higher percentage of women declare that they are reassured in this respect. Also, in both cases insurance is a financial product very little known and used. When it comes to insurance policies, except for vehicles and housing, a quarter of those surveyed are not familiar with these products, and the percentage of those who own life, health or property insurance policies vary, rarely exceeding 50%. Currently, 68% of women and 54% of men don’t have a sickness and accident insurance, and 20% of women and 26% of men don’t know what is the coverage offered by the one they have. When it comes to property insurance, the percentages change: 50% of women do not have such insurance (37% is the percentage for men), 22% do not know what it would cover (16% of men), and 15% say it wouldn’t be enough to replace the damaged property vs. 26% of men declaring that it would be enough to replace the damaged good. While the main concern of women (19% of them) is how to save, a higher percentage of men declare that they can save systematically (66% vs. 54% of women). If they were left without their job (or main income source), men would spend their money in more time (25% more than 9 months, 23% for 3-5 months), while women would spend the money within a month (39%) or 1-2 months (29%).

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THE MOST PERFORMING SHARES IN THE FIRST LEAGUE OF THE STOCK EXCHANGE OMV Petrom, Banca Transilvania and Romgaz are the most performing shares in the first league of the Bucharest Stock Exchange in the first ten months of 2018, in the context in which they display the highest returns among the 15 shares of the main index, BET, according to calculations made by the brokerage firm Prime Transaction. Shares in OMV Petrom delivered for investors a return of 43%, evolution adjusted with dividends paid by the company from the profit for 2017, and the state-owned company Romgaz - 23%. The seven managers of Pillar II private pension funds in Romania (NN Pensii, Allianz Tiriac Pensii, Metropolitan Life Pensii, Aegon Pensii, Generali Pensii, BCR Pensii, BRD Pensii), which manage the retirement money of around 7.2 billion Romanians, have investments of RON 1.1bn in Romgaz, the largest gas producer and the main gas supplier of Romania.

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Key files of the Clean Energy for All Europeans package adopted Commission welcomes European Parliament adoption of key files of the Clean Energy for All Europeans package. New rules on renewables, energy efficiency and the governance of the Energy Union have been signed off by the European Parliament on November 13 – an important step in enabling the European Union and its Member States to embrace the clean energy transition, follow up on the already adopted 2030 climate legislation and meet the Paris Agreement commitments. he European Parliament completed the parliamentary T approval of half of the eight legislative proposals in the 2016 Clean Energy for All Europeans package, following the Energy Performance in Buildings Directive, which came into force on 9 July. The package is a key element of the Juncker Commission’s political priority of “a resilient Energy Union with a forward-looking climate change policy,” aimed at giving Europeans access to secure, affordable and climate-friendly energy and making the European Union world leader in renewable energy. “Four out of eight proposals of the Clean Energy for All Europeans Package have now been fully agreed, a signal that we are on the right track and that we will deliver on our pledge made at the beginning of the mandate. Our ambitious commitment to clean energy in Europe and the Paris Agreement will be made a reality by laws like the ones voted today. I now call on Member States to show similar ambition and leadership when submitting their draft National Energy and Climate Plans that are due by the end of this year,” Commissioner for 70

Climate Action and Energy Miguel Arias Cañete added. The new regulatory framework, in particular via the introduction of the first national energy and climate plans, brings regulatory certainty and enabling conditions for essential investments to take place in this important sector. It empowers European consumers to become fully active players in the energy transition and fixes two new targets for the EU in 2030: a binding renewable energy target of at least 32% and an energy efficiency target of at least 32.5%, which will stimulate Europe’s industrial competitiveness, boost growth and jobs, reduce energy bills, help tackle energy poverty and improve air quality. When these policies will be fully implemented, they will lead to steeper emission reductions for the whole EU than anticipated– some 45% by 2030 compared to 1990, instead of 40%. To strive towards a long-term greenhouse gas reduction objective, the framework sets up a robust governance system of the Energy Union. energyindustryreview.com

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• • •

•

“With today’s vote, we unlock the true potential of Europe’s clean energy transition, helping us meet our Paris Agreement goals and translating into more jobs, lower energy bills for consumers and less energy imports. The Energy Union is coming of age, going from strength to strength,” Maroš Šefčovič, Vice-President responsible for the Energy Union

MAIN ACHIEVEMENTS Renewable Energy • Sets a new, binding, renewable energy target for the EU for 2030 of at least 32%, including a review clause by 2023 for an upward revision of the EU level target. • Improves the design and stability of support schemes for renewables.

Delivers real streamlining and reduction of administrative procedures. Establishes a clear and stable regulatory framework on self-consumption. Increases the level of ambition for the transport and heating/cooling sectors. Improves the sustainability of the use of bioenergy.

Energy Efficiency • Sets a new energy efficiency target for the EU for 2030 of at least 32.5%, with an upwards revision clause by 2023. • Will extend the annual energy saving obligation beyond 2020, which will attract private investments and support the emergence of new market actors. • Will strengthen rules on individual metering and billing of thermal energy by giving consumers - especially those in multi-apartment building with collective heating systems – clearer rights to receive more frequent and more useful information on their energy consumption, enabling them to better understand and control their heating bills. • Will require Member States to have in place transparent, publicly available national rules on the allocation of the cost of heating, cooling and hot water consumption in multi-apartment and multi-purpose buildings with collective systems for such services. Governance of the Energy Union and Climate Action • Puts in place a simplified, robust and transparent governance for the Energy Union which promotes long-term certainty and predictability for investors and ensures that EU and Member States can work together towards achieving the 2030 targets and the EU’s international commitments under the Paris Agreement. • Calls for each Member State to prepare a national energy and climate plan for the period 2021 to 2030, covering all the five dimension of the Energy Union and taking into account the longer-term perspective. • Aligns the frequency and timing of reporting obligations across the five dimensions of the Energy Union and with the Paris Climate Agreement, significantly enhancing transparency and reducing the administrative burden for the Member States, the Commission and other EU Institutions.

NEXT STEPS Following this approval by the European Parliament, the Council of Ministers will now finalise its formal approval of the three laws in the coming weeks. This endorsement will be followed by the publication of the texts in the Official Journal of the Union, and the new legislation will enter into force 3 days after publication. 71

ÂŠ European Commission

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EC and Bill Gates launch EUR 100 million clean energy investment fund On October 17, the European Commission and Bill Gates-led Breakthrough Energy have signed a Memorandum of Understanding to establish Breakthrough Energy Europe (BEE) â&#x20AC;&#x201C; a joint investment fund to help innovative European companies develop and bring radically new clean energy technologies to the market. 72

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are delivering on our commitment We to stimulate public-private cooperation in financing clean energy innovation. The EUR 100 million fund will target EU innovators and companies with the potential to achieve significant and lasting reductions in greenhouse gas emissions,” Carlos Moedas, Commissioner for Research, Science and Innovation, stated. With this initiative, the Commission takes action to continue leading in the fight against climate change and to deliver on the Paris Agreement – giving a strong signal to capital markets and investors that the global transition to a modern and clean economy is here to stay. “Europe must continue to take the lead in tackling climate change head on, at home

and across the world. We must push for the modernisation of Europe’s economy and industry in order to meet the ambitious targets put in place to protect our planet. Pooling public and private investment in new, innovative clean energy technology is key to enabling long-term solutions to reduce greenhouse gas emissions. If Europe is to have a future that can guarantee the well-being of all its citizens, it will need to be climatefriendly and sustainable,” President JeanClaude Juncker said. “The scale and speed of what is needed to reach our climate goals require innovative thinking and bold action. Not only is this new public-private investment vehicle being set up in record time, it will also serve as an example of us joining forces to accelerate breakthrough innovation in Europe,” Maroš Šefčovič, Vice-President of the Commission for the Energy Union, underlined. “We need new technologies to avoid the worst impacts of climate change. Europe has demonstrated valuable leadership by making impressive investments in R&D. The scientists and entrepreneurs who are developing innovations to address climate change need capital to build companies that can deliver those innovations to the global market. Breakthrough Energy Europe is designed to provide that capital,” Bill Gates, Chairman of Breakthrough Energy Ventures, added. Breakthrough Energy Europe links public funding with long-term risk capital so that clean energy research and innovation can be brought to market faster and more efficiently. With a capitalisation of EUR 100 million, the fund will focus on reducing greenhouse gas emissions and promoting energy efficiency in the areas of electricity, transport, agriculture, manufacturing, and buildings. It is a pilot project that can serve as a model for similar initiatives in other thematic areas. Breakthrough Energy Europe is expected to be operational in 2019. Half of the equity will come from Breakthrough Energy and the other half from InnovFin – risk-sharing financial instruments funded through Horizon 2020, the EU’s current research and innovation programme.

As our planet increasingly faces the unpredictable consequences of climate change and resource depletion, urgent action is needed to adapt to a more sustainable model. The EU, which played a decisive role in building the coalition of ambition making the adoption of the Paris Agreement possible in December 2015, is a global leader on climate action. The Commission has already brought forward all legislative proposals to deliver on the EU’s commitment to reduce emissions in the European Union by at least 40% by 2030. Beyond updating and strengthening its energy and climate legislation, the EU is developing enabling measures that will stimulate investment, create jobs, empower and modernise industries. The Commission is currently working on the long-term strategy for the reduction of greenhouse gases. The proposal will be published in November 2018, ahead of the COP24 in Katowice, Poland. In the margins of the COP21 climate conference in Paris, global leaders launched Mission Innovation, an international partnership to accelerate clean energy innovation and provide a long-term global response to climate challenge. By joining Mission Innovation, 23 countries and the European Commission (on behalf of the EU) pledged to double their clean energy research and innovation funding to about USD 30 billion per year by 2021. On the same occasion, a group of investors from ten countries announced their intention to drive innovation from laboratories to the market by investing long-term capital at unprecedented levels in early-stage technology development in Mission Innovation participating countries, thereby creating the Breakthrough Energy Coalition. In December 2017, during the One Planet Summit in Paris, Breakthrough Energy announced the piloting of public-private partnerships with five Mission Innovation members, including the European Commission. 73

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Enel Green Power España to build its first solar park in Extremadura nel Green Power España E (EGPE), Endesa’s renewable energy division, has started construction of three solar plants for an overall capacity of around 126.6 MW in the municipality of Logrosán, near Cáceres, representing the company’s first solar plants in the Extremadura region. The three photovoltaic (PV) plants, Baylio, Dehesa de los Guadalupes and Furatena, will involve a total investment of approximately 100 million euros and will each have an installed capacity of over 42 MW. “The start of construction of our first solar parks in Extremadura represents an important milestone for our Group and the country itself as we continue to expand our PV footprint into new areas of the important Spanish market while helping the country to achieve its renewable goals,” said Antonio Cammisecra, Head of Enel’s Global Renewable Energy business line, Enel Green Power (EGP). “These projects are the latest examples of our commitment to further diversify the Spanish generation mix by leveraging on the wealth of solar resources in the region, where we are also determined to bring our global technological expertise, and initiatives aimed at boosting the sustainability of our construction site.” The three solar plants, which will be comprised of around 372,000 PV modules, are slated to enter into service by the end of 2019. Once fully operational, 74

they will be able to generate more than 240 GWh annually, avoiding the emission of around 120,000 tonnes of CO2 per year. The three projects will be based on Enel Green Power’s ‘Sustainable Construction Site’ model, which includes the use of a 20-kW photovoltaic system at each site, to meet their energy needs during construction, as well as other initiatives aimed at involving the local population in the construction phase. EGPE will utilise several innovative construction processes and equipment on the three sites, including drones for topographical survey, smart tracking of certain components such as solar panels, main transformers and cables, as well as advanced digital platforms and software solutions to oversee the progress and quality of construction and remotely support site activities and plant commissioning. These practices and tools will enable faster, more accurate and reliable data collection, enhancing construction quality and facilitating communication between on-site and offsite teams. The three facilities are part of the seven PV projects for a total capacity of 339 MW that were awarded to EGPE following the July 2017 renewable tender. The remaining projects include one located in Murcia, Totana, for which construction started in September, and

three others in Extremadura, in the municipalities of Talarrubias and Casas de Don Pedro, province of Badajoz. In addition, following the country’s May 2017 renewable tender, the company was awarded wind projects for an installed capacity of 540 MW. The overall 879 MW of wind and solar awarded in these last two tenders will involve a total investment of over 800 million euros by 2020, and will increase EGPE’s current portfolio by 52.4%. Enel Green Power España is Endesa’s renewable energy company and currently manages over 1,815 MW of capacity in Spain, after the recent incorporation of the 5 Gestinver wind parks (132 MW) into its generation mix. Out of the total capacity, 1,750 MW come from wind energy, 51 MW from mini-hydraulic power and 14 MW from other renewable energy sources. Enel Green Power, the global renewable energy business line of the Enel Group, is dedicated to the development and operation of renewables across the world, with a presence in Europe, the Americas, Asia, Africa and Oceania. Enel Green Power is a global leader in the green energy sector with a managed capacity of around 43 GW across a generation mix that includes wind, solar, geothermal and hydropower, and is at the forefront of integrating innovative technologies into renewable power plants. energyindustryreview.com

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Trina Solar provides 190MW of its TrinaPro PV solution to large solar park in Spain

rina Solar, a leading total T solutions provider for solar energy, announced that it will provide 190megawatts of its integrated photovoltaic (PV) solution TrinaPro to Cobra for a large solar park in Spain. ACS Group and its subsidiary Cobra, specializing in turnkey energetic infrastructures, are building this EPC project in Alcázar, Ciudad Real province (Spain), with a total power capacity of 190MW. The project is expected to be completed by the end of 2019, and is set to become the first of many TrinaPro projects in Europe. Trina Solar will supply its integrated TrinaPro PV solution consisting of 560,000 units of TSM-PE14H

multicrystalline half-cut cell modules, as well as the corresponding 6,206 singleaxis tracker units. The high efficiency modules will be mounted on Trina Solar’s single-axis tracking system, which allows the modules to follow the sun at optimum angles, thus receiving maximum sunlight and generating up to an 25% additional power in stable conditions. TrinaPro is the first PV solution with an optimized combination of Trina Solar’s industry-leading solar modules and stateof-the-art solar tracker systems. As a valueadded solution, TrinaPro is optimally engineered with premium components and system integration. It is one of the most reliable solutions in the solar industry for high energy yields.

“We are delighted that Cobra has placed their trust in the superior quality and performance of Trina Solar products again for this new impressive project in Spain. This new sales agreement for the supply of 190MW follows the recent order of 167MW for the biggest project in Europe which is under development in Murcia, Spain,” Gonzalo de la Viña, Head of Module Business Europe at Trina Solar, said. “By harnessing the power of data and optimizing the design of the entire system, we further increase overall efficiency. TrinaPro can boost system power output by up to 30%. We are proud that Trina Solar has evolved from a module supplier to a value-added solutions provider, bringing greater value to our customers,” De la Viña added. 75

ÂŠ Naval Research Laboratory

METALS & MINING

Dr. Corey T Love, The Naval Research Laboratory, Alternative Energy Section; Chemistry Division constructs experimental Li-ion cell which allows in-situ optical microscopy of lithium dendrite formation and growth.

Lithium-ion battery market set to expand 76

energyindustryreview.com

METALS & MINING

According to a report published by Transparency Market Research, the lithiumion battery market is expected to grow from USD 29.68 Billion in 2015 to reach USD 77.42 Billion by 2024. The market is also expected to register a compound annual growth rate (CAGR) of 11.6% during the forecast period. Lithium-ion batteries are designed to provide higher productivity and longer life expectancy than other batteries. Based on their application, the lithium-ion battery market is segmented into the automotive, consumer electronics, and industrial and grid energy segments. Automotive and consumer electronics are two of the major segments of the global lithium-ion battery market due to the increasing demand for electric vehicles, smartphone, laptops and other devices. Companies like European Electric Metals, Lithium Americas, Artemis Resources, First Cobalt Corp, NRG Metals all have a stake in this. ithium and cobalt are the two L essential components of lithiumion batteries. Cobalt production is bound closely to copper and nickel mining, as there are very few pure cobalt mines. Additionally, the cobalt supply is mainly dominated by the Democratic Republic of Congo (DRC). These factors have driven the cobalt price surge in recent years, according to Chemistryworld, Caspar Rawles, market analyst at Benchmark Minerals Intelligence: “For the first time we have seen large-scale battery manufacturers increase their prices. That has largely been down to the price of key commodities such as lithium and cobalt. Cobalt has a big impact and that is one of the big talking points for the industry right now.”

Recently, European Electric Metals released breaking news that it is pleased to announce, “the appointment of Ian Stalker as Advisor”. Ian Stalker is an international mining executive with 45 years of experience in mine development and operations in Europe, Africa and Australia. Mr. Stalker was the Chief Executive Officer of UraMin, a London-listed and Toronto-listed uranium company, from July, 2005, until its USD 2.5 billion acquisition by Areva in August, 2007. Mr. Stalker was a vice-president of Gold Fields, the world’s fourthlargest gold producer, where he spent considerable time on the ground on its international operations. He has held executive positions in some of the

largest mining companies in the world and has successfully managed eight mining projects through feasibility study, development and construction phases. He also has significant cobalt experience gained during his time on the Zambian Copperbelt from 1973 to 1987. Mr. Stalker operated the country’s only dedicated cobalt process plant and was involved in the design and construction of the plant, which is still in operation. Additionally, he was the Chief Executive Officer of the Luanshya Mine from 19992000, after its 1997 privatization, where the bulk of the cobalt production from the Copperbelt was centred. Mr. Stalker’s current roles include Chairman of Plateau Energy Metals, Chief Executive Officer 77

METALS & MINING

of LSC Lithium and Director of K92 Mining. “Ian not only has a track record of success at starting and re-starting mining operations, but his experience is unique in that it includes significant operational expertise in cobalt mining and processing. Our Skroska NickelCobalt Mine is a fully developed mine with excellent underground infrastructure, development and equipment and we are targeting a restart of operations. Ian will be a big asset as we push forward aggressively with these plans,” Fred Tejada, EVX Chief Executive Officer, states. European Electric Metals is a Canadian listed public company, with a focus on electrification themed projects in Europe. A major shareholder of EVX is the European Bank for Reconstruction and Development. The goal of EVX is to become a major source of battery metals such as copper, nickel and cobalt, and the company seeks to do so within safe, stable and logistically attractive European jurisdictions. The company’s projects are ideally located with excellent road, port and grid power availability, and near European countries that are poised to experience dramatic growth in the electric-vehicle-manufacturing industry. There is a strong battery-manufacturing industry within Europe with many more projects in the pipeline. Lithium Americas is developing Caucharí-Olaroz, under construction in Jujuy, Argentina, and on the closing of the transaction will have a 62.5% interest in Cauchari-Olaroz with Ganfeng Lithium holding a 37.5% interest. Lithium Americas recently announced that it has entered into definitive transaction agreements to implement a number of transactions, pursuant to which, among other things, a subsidiary of Sociedad Química y Minera de Chile has agreed to sell all of its interest in Minera Exar, the holding company for the Caucharí-Olaroz lithium brine project, to a subsidiary of Jiangxi Ganfeng Lithium. As a result of the transaction, Ganfeng Lithium will become Lithium Americas’ partner in developing and operating the project, which is currently under 78

development in Jujuy, Argentina. Lithium Americas’ interest in Caucharí-Olaroz will increase from 50% to 62.5%, with Ganfeng Lithium holding the remaining 37.5% interest. “We would like to thank SQM for providing the support to advance CaucharíOlaroz into construction, helping to build an independent team in Jujuy and putting the project on a path to reach first production by 2020,” said Lithium Americas’ Chief Executive Officer, Tom Hodgson. “We are also very pleased to welcome Ganfeng Lithium as our new partner at Cauchari-Olaroz to continue development on our previously disclosed timeline and explore future opportunities to collaborate,” he added. Artemis Resources is a diversified explorer transitioning towards development. Artemis Resources recently announced that high-grade cobalt, copper and gold mineralization has now been extensively drilled over a continuous strike of 1.2km from a target of over 12km in strike length at its 100% owned Carlow Castle Project, located 30km from Artemis’s Radio Hill processing plant. All drill results have now been received from the extensive 24,655m drilling programmed and a new JORC 2012 compliant resource is now being estimated and is scheduled to be delivered this quarter. The company is expecting a significant increase in the previous maiden JORC resource as reported in January 2018. “CarlowCastle was one of the first ever cobalt discoveries in Australia in the 1920’s and since intersecting cobalt grades up to 6.5% in the early stages of this drilling programme, this project continues to deliver outstanding results,” Artemis’ Executive Director Ed Mead commented. First Cobalt is a North American pure-play cobalt company whose flagship asset is the Iron Creek Cobalt Project in Idaho, USA, which has inferred mineral resources of 26.9 million tons grading 0.11% cobalt equivalent. First Cobalt recently reported new drill results from its Iron Creek Cobalt Project. Results reported demonstrate thicker cobalt mineralized zones as

well as mineralization between the two recognized zones. Highlights: All drill holes reported contain mineralization over long widths and grades above the inferred resource average grade, including: 25.7m of 0.35% Co and 0.62 Cu (0.42% CoEq) in hole ICS1803, 22.6m of 0.34% Co and 0.59% Cu (0.40%CoEq) in hole IC18-29,27.8m of 0.27% Co and 1.09% Cu (0.38% CoEq) in hole ICS18-02; Higher grade mineralization occurs within the broader zones of mineralization, including 8.0m of 0.45% Co and 2.07% Cu (0.65%CoEq) in hole ICS18-02; Several mineralized intersections occur in between the No Name and Waite Zones, including 3.8m of 0.30% Co in hole IC18-28. “Today’s drill results from our flagship asset support the development vision for the future of the Iron Creek Project. We now have three drill rigs on site for infill and extensional drilling as we work towards updating the mineral resource estimate in early 2019,” Trent Mell, President & Chief Executive Officer, commented. NRG Metals is an exploration stage company focused on the advancement of lithium brine projects in Argentina. NRG Metals recently provided additional information regarding the maiden lithium (Li) and potassium (K) resource statement for its Hombre Muerto North lithium brine project in the Salta province of Argentina. The average grade of lithium for the 571,000 tones combined measured and indicated resource (509,000 measured and 62,000 indicated) is 756 mg/litre lithium, with a low lithium to magnesium ratio of 2.6 to one. “The grades we are seeing at the Hombre Muerto Project are some of the highest reported grades for any of the lithium-bearing brine deposits in Argentina. The combination of high grades, excellent chemistry and good pumping rates are very positive indicators that we hope will allow us to advance the project through feasibility studies to production should the economic viability and technical feasibility of the project be established,” Adrian Hobkirk, President and Chief Executive Officer of NRG, pointed out. energyindustryreview.com

METALS & MINING

Cohesion Policy contributes to the Energy Union strategy SUPPORTING COAL REGIONS IN TRANSITION October 9, the Vice-President On of the European Commission for the Energy Union Maroš Šefčovič and the European Commissioner for Regional Policy Corina Cretu hosted the high-level event ‘Energy Union in motion Cohesion Policy supporting coal regions in transition’ in Brussels. The event, which took place in the framework of the European Week of Regions and Cities, gathered key policy-makers from coal regions in transition from Czech Republic, Germany, Poland, Romania and Slovakia. “The EU committed not to let behind anybody and no region in the transition process toward a law carbon emissions economy. The Cohesion Policy makes significant investments in promoting growth and job creation in coal regions by giving them support for identifying, developing and investing in those areas in which they can become competitive - what we call ‘smart specialisation’,” Corina Cretu stated. Promoting clean energy, accelerating the transition towards a low-carbon economy and fighting climate change are amongst the European Commission’s top priorities, in line with the Paris Agreement and the EU’s global leadership on climate action, as showed at the recent One Planet Summit event in New York. Many European regions are well positioned to take advantage of the new opportunities arising from these

technological and industrial changes, while others face deindustrialisation and job losses. In this shift to a modern and clean economy, the goal of the Commission is to ensure that no region is left behind when moving away from an economy driven by fossil fuels. In 2017, the Platform for Coal Regions in Transition was launched, as part of the Coal and Carbon-Intensive Regions in Transition Initiative, a key action from the Clean Energy for All Europeans package. The aim of the Platform is to assist Member States and regions in their efforts to modernise their economies and prepare them to deal with the structural and technological transition in coal regions. It brings together regions, national authorities, societal and business stakeholders, innovation and financing experts in order to identify the best ways to seize the opportunities of the transition. EU Cohesion Policy contributes to the initiative by providing a structural and long-term response to industrial transition and restructuring of European regions, including the coal and carbon-intensive regions. Thanks to the direct and constant contact with regional partners on the ground, Cohesion Policy helps regions achieve economic transformation by building on their ‘smart specialisation’ assets, i.e. their niche areas of competitive strength, with the aim to embrace innovation and decarbonisation. Europe’s coal regions have received

several billion euros of EU funds to foster investments in growth and jobs, focusing on SMEs, business incubators, innovation and research, capacity building and skills, as well as support for sustainable transport and social inclusion and for overall societal transformation and modernisation, including an important focus on the shift to a low-carbon economy. Moreover, in view of preparing for the next budgetary period, the European Commission has launched a second set of pilots, ‘regions in industrial transition’, with a broader focus on the transition to a low-carbon economy. Twelve regions have already started to work in partnership with teams of experts from the European Commission to boost their innovation capacity, remove investment barriers, equip workers with the right skills and prepare for industrial and societal change, based on their smart specialisation strategies. For the next financial period, the Commission has proposed for smart specialisation strategies to take into account the challenges linked to industrial transition, such as the decarbonisation challenge. The ‘Energy Union in motion Cohesion Policy supporting coal regions in transition’ event was the occasion to communicate on the progress achieved and the perspectives of the Member States and regions in their further work towards the clean energy transition. 79

TOOLS & MACHINES

8 new aerial work platforms from Zoomlion

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TOOLS & MACHINES

Zoomlion, one of China’s top construction machinery manufacturers, has launched eight new aerial work platform models.

he 8 new aerial work machinery T products released by Zoomlion cover the self-propelled electric scissor lift type, curved arm type and straight arm type. Based on Zoomlion’s traditional technical advantages and supplemented by such new technologies as the Internet of Things (IoT) and modern sensing, these new products are characterized by ‘reliability, simplicity and efficiency’, with several indicators reaching industry-leading level; they also meet the requirements of European, American and national standards, and can provide customers and aerial work operators with a safe, efficient and comfortable user experience. According to the Technical Director, the scissor lift platform has a designed platform height of 6-12 m and a maximum bearing capacity of 350 kg, enabling it to support three people working at height within the vertical lifting range. It can be widely used in construction, workshop construction, housing decoration and maintenance, etc. At the same time, Zoomlion pays special attention to safety and stability in its scissor lift platform products; the designed center of gravity is low and the lateral deflection is small, contributing to high operation stability. The products are mainly battery powered, green and environmentally friendly, and their endurance is more than 10% higher than that of their peers. At present, Zoomlion’s scissor lift products have obtained the relevant qualifications to be sold in the markets of Europe and Southeast Asia. In addition, the two arm-type aerial work platforms presented at the launch event all adopt a four-wheel-drive cross-country chassis with a maximum climbing capacity of 45%, satisfying a range of outdoor work conditions. Among them, the curved arm aerial work platform ZA14J is China’s first 14 m

curved arm product designed for superlarge load and dual load, and its bearing capacity is more than 30% higher than that of other products in the industry. At the same time, the product adopts a zero-tail pendulum design, making it very suitable for operation in narrow space. The other straight-arm aerial wok operation platform ZT26J has reached industry-leading level in micro-motion control, with a minimum telescoping speed of 20 mm/s and a leveling accuracy of less than 1.5 degrees. The product adopts a boom structure of three telescopic arms plus flying arms, and has been optimized in the aspects of telescopic boom stability and leveling accuracy, making it an absolutely leading aerial work platform. The 8 new aerial work machinery products released by Zoomlion all adopt modern sensing and IoT technology; equipped with artificial intelligence ‘brains’, they can realize intelligent fault warning and diagnosis through such means as remote management platforms, mobile APPs, equipment self-control systems, etc. The complete sensing system can provide accurate safety warnings in case of overloading, tilting, potholes, etc., thereby maximizing the convenience and safety of mechanical operation. According to industrial analysis, assuming that China’s development of aerial work platforms reaches the European level in the future, the corresponding number of aerial work platforms will be 630,000. At present, China’s holding volume is only 40,000, with growth space of 16 times, and the corresponding market size is expected to reach nearly RMB 100 billion. Assuming such development reaches the American level, the corresponding growth space will be 40 times. In the future, China’s aerial work platforms are expected to usher in a rapid development period. 81

TOOLS & MACHINES

JEWELSUITE™ SUBSURFACE MODELING

Reducing uncertainty below the earth’s surface

Quickly create precise geological models that seamlessly transfer into your reservoir simulator With its revolutionary gridding technology and advanced structural modeling capability, BHGE’s JewelSuite™ Subsurface Modeling application allows faster, better, more robust evaluation of the most complex geology. The application can rapidly build multiple scenarios and accelerates analysis of alternative possible outcomes for determining optimal field development plans. Reservoir models can be updated and modified easily with new well information or alternative geological scenarios to reduce the uncertainty that inevitably exists beneath the earth’s surface. 82

HGE’s JewelSuite™ Subsurface B Modeling application is an innovative, powerful tool to quickly create precise geological models—regardless of the reservoir’s structural complexity - in half the time as traditional solutions. This modeling tool can seamlessly transfer into any industry standard simulator. Reservoir models can be updated and modified easily with new well information or alternative geological scenarios to optimize field development plans and drive greater production.

The JewelSuite™ Subsurface Modeling application gives you a rich understanding of your reservoir to position your wells properly, construct them effectively, and accurately predict recovery. JewelSuite’s™ patented gridding technology and innovative approach to structural modeling enables you to model complex structures without oversimplifying the data - providing a highfidelity representation of your reservoir’s true geology. Advantages of using BHGE’s JewelSuite™ Subsurface Modeling services include:

• •

Faster, more precise modeling: Precise geological models in half the time; Superior gridding technology: Realistically describe structurally complex reservoirs using BHGE’s superior technology; Innovative fluid modeling workflow: Remove the requirement for a 3D grid for defining fluid distribution; Integration capabilities: Run multiple scenarios to reduce uncertainty and seamlessly integrate with flow and geo-mechanical simulation. energyindustryreview.com

TECH

ENN Energy’s Zhoushan LNG Terminal | Photo: VeChain

VeChain to pilot Blockchain-enabled LNG solution hina’s commitment to being a C world leader in clean energy adoption and the reduction of carbon emissions has taken a significant step forward on 1 November with the announcement of a liquified natural gas (LNG) management solution, enabled by the VeChainThor Blockchain. The blockchain solution is the result of a new joint initiative between VeChain and 84

two of China’s leading energy and gas companies ENN Energy Holdings Limited and Shanghai Gas (Group) Co., Ltd. The formal announcement of this new LNG initiative was made at The China International Gas & Heating Technology and Equipment Exhibition 2018 hosted by the China Gas Association. In the introduced solution, ENN Energy Holdings Limited is responsible

for the design and system construction of LNG-related business scenarios and is providing the necessary vehicles/ equipment. In the pilot rollout of this solution, ENN Energy Holdings Limited will provide the onsite technical team and testing locations working within their existing businesses. As an extension of the pilot and surrounding tests, ENN Energy Holdings Limited also will be one energyindustryreview.com

TECH

Shanghai Gas (Group) Co. Ltd Chairman and Party Secretary Wang ZheHong (Left 4), ENN Energy Holdings, Vice President Hang Jishen (Left 3), Shenzhen Gas Chairman Li Zhen (Left 3), VeChain COO, Kevin Feng (Left 1), and other delegates from Chongqing Gas, Beijing Gas, and Towngas China Company Ltd. Photo: VeChain

of the operating parties in the commercial landing projects. VeChain is responsible for providing blockchain core technology and the necessary software services. Shanghai Gas is the overseeing party who ensures the solution expands across the national LNG market and has already connected a host of similar companies to the expansion of this solution. Their role within the solution is to provide policy guidance ensuring government mandates and related process management. Shanghai Gas will provide resource coordination and support for the development of LNG-related businesses within the commercial landing project to facilitate its national expansion. The solution handles the quality assurance process including classification standards, weighing practices, and transportation process for the different types of natural gas. All information is certified by a third-party authority and uploaded to the VeChainThor Blockchain to establish credible industry standards per government mandates. From there, all aspects related to the data will be tracked, shared, and traded using the VeChainThor Blockchain which will be used for further auditing the LNG market. The online LNG trading exchange for this solution will use Greatgas.cn affiliated to ENN Energy Holdings Limited. VeChain is responsible for providing backend blockchain infrastructure

technology for this exchange. The VeChainThor Blockchain will be used for processes and procedures currently on the website, including the storage of qualification certificates and SKU inspection reports. Zhoushan LNG Storage and Distribution Centre will be the first to implement this solution during the pilot phase prior to a broader rollout. The Centre includes 3 docks, 2 allinclusive LNG storage tanks, 14 tank truck loading rafts, high-pressure IFV gasification facilities, high-pressure external transmission, cold energy power generation and other supporting technologies and auxiliary facilities. The annual processing capacity of LNG at this plant is 3 million tons.

ABOUT ENN ENERGY HOLDINGS LIMITED ENN Energy Holdings Limited (2688. HK), a flagship industry of ENN Group, has been engaged in the urban pipeline gas business from 1992. It is one of the largest-scale clean energy distributors in China. Through continuous strategic upgrading, it has formed four core businesses - natural gas sales, integrated energy service, energy trade, and energy transmission and distribution, committed to becoming an integrated energy service provider. By the end of 2017, the company has a total asset of 60 billion

RMB and more than 400 wholly-owned and holding companies and branches, with more than 32,000 employees. They currently hold a market cap of $85Bn producing 56B HKD in 2017 revenue.

ABOUT SHANGHAI GAS CO., LTD Since the official gas supply of the Shanghai Gas in 1865, the state-owned urban gas company has experienced more than 150 years of business. At present, Shanghai Gas (Group) Co., Ltd has achieved the goal management model of ‘multi-gas source, one network, and diversified sales’ and a complete industrial system. As of 2017, the Shanghai Gas market share accounts for more than 90% of Shanghai’s total market, with an annual supply of more than 8.06 billion cubic meters. The company’s customer size and storage & transportation capacity ranks the highest in China.

ABOUT VECHAIN Starting in June 2015, VeChain aims to connect blockchain technology to the real world by providing a comprehensive governance structure, a robust economic model, and IoT integration. VeChain is the pioneers of real-world applications using public blockchain technology, with international operations in Singapore, Luxembourg, Tokyo, Shanghai, Paris, Hong Kong, and San Francisco. 85

ANALYSIS

19 MILLION ROMANIANS HAVE LOST 292.000 YEARS OF LIFE

Pollution in EU wreaking havoc on human health 86

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ANALYSIS

Despite constant improvement over the past few years, air pollution continues to exceed the limits imposed by the European Union (EU) and the World Health Organization, according to the last report of the European Environment Agency (EEA) – ‘Air quality in Europe – 2018’. Romania is no exception, the life of Romanians being shortened by around 292.300 years due to pollution in 2015, according to the mentioned document. Adrian Stoica

oad transport, agriculture, R energy production, industry and households contribute to the greatest extent to air pollution. In mid-May, six countries were referred by the European Commission to the EU Court of Justice for failure to fulfil their obligations in terms of air quality. Together with France, Germany, the UK, Italy and Hungary is also Romania. Particulate matter (PM) and nitrogen dioxide (NO2 emitted by diesel engines)

and ground-level ozone (O3) seriously affects human life, in conditions in which the 2,500 air quality monitoring stations in Europe have revealed the existence of high concentration of such compounds. Air pollution also has a considerable economic impact, leading to a shorter living time, increased medical costs and reduced productivity across the economy by working days lost due to health issues. Concentrations of atmospheric particulate matter (PM) continued to exceed the limit values imposed by the EU and the World Health Organization, which are stricter, in many areas of Europe in 2016. For PM with a diameter of 10 μm or less (PM10, PM2.5), concentrations above the daily limit value imposed by the EU were recorded by 19% of the monitoring stations in the 28 EU Member States and in other European states outside the Community space, but which make such measurements. Thus, for PM2.5, concentrations exceeding the annual limit value were recorded at 5% of the reporting stations in four EU Member States and other four reporting states. Limits imposed by WHO for PM10 were exceeded in almost all countries, with the exception of Estonia, Island, Ireland and Switzerland. As regards WHO limits for PM2.5, they were exceeded in most states, the exceptions being Estonia, Finland, Hungary, Norway and Switzerland. No

less than 13% of the urban population of EU-28 was exposed to PM10 levels above the daily limit value and approximately 42% was exposed to concentrations exceeding WHO limits for PM10 in 2016. As regards PM2.5, 6% of the urban population of EU-28 was exposed to levels above EU limit, and approximately 74% was exposed to concentrations exceeding WHO value for PM2.5 in 2016. However, the report mentions that the percentage of population of EU-28 in cities exposed to concentrations of PM10 above the limit values and WHO guidelines in 2016 was the lowest (since 2000), and for PM2.5 since 2006, noticing a downward trend. The estimates updated in the report indicate the fact that in 2015 concentrations of atmospheric particulate matter (PM2.5) were responsible for approximately 422,000 premature deaths in 41 European countries, of which approximately 391,000 were in the 28 EU Member States. A wider assessment included in this year’s report shows that since 1990 premature deaths due to PM2.5 have been reduced by about half a million per year. “Air pollution is an invisible killer and we need to step up our efforts to address the causes. As far as air pollution is concerned, emissions from road transport are often more harmful than those from other sources, as they occur at ground level and tend to occur in cities, near people. That is why it is 87

ANALYSIS

energyindustryreview.com

ANALYSIS

so important for Europe to double its efforts to reduce emissions from transport, energy and agriculture and invest in making them cleaner and more sustainable”, says Hans Bruyninckx, EEA Executive Director. The effects of these exposures at concentrations exceeding permitted levels are increased mortality and morbidity, and on the other hand they lead to degradation of air and water quality and therefore affect the health of ecosystems and climate change. At the level of 2016, for the member countries of the Organization for Economic Cooperation and Development (OECD), direct costs generated by pollution of USD 1,280 (approximately EUR 1,100) per capita were estimated for 2015 and USD 2,8802,950 (approximately EUR 2,480-2,540) per capita for 2060. Also, in the area of OECD member states, indirect costs generated by air pollution amounted to USD 1,200 (approximately EUR 1,030) per capita in 2015 and it is estimated that they will increase to USD 2,610-2,680 (approximately EUR 2,250-2,310) per capita in 2060. The percentage of urban population in EU-28 exposed to PM2.5 was 6% in 2016, decreasing from 7% in the previous year. However, approximately 74% of EU’s urban population was exposed to concentrations exceeding the stricter guidelines of WHO. Exposure to PM2.5 has caused the premature death of an estimated number of 422,000 persons in 41 countries in 2015. The annual limit value for NO2 continues to be exceeded throughout Europe. In 2016, 7% of the urban population of EU-28 lived in areas with higher concentrations than the annual limit value of the EU and WHO guidelines. However, the percentage decreased from 9% in 2015. Exposure to NO2 has caused the premature death of an estimated number of 79,000 persons in 41 countries in 2015. The annual limit value for nitrogen dioxide (NO2) continues to be exceeded throughout Europe, even if the concentration and exposure are falling. In 2016, approximately 12% of all reporting

stations recorded values above the limits accepted by WHO. Around 12% of the urban population of EU-28 was exposed to O3 levels above the target value of EU in 2016, which represents a considerable decrease compared to 2015 (30%). However, the percentage is still very high, given that in 2014 the percentage of population exposed was 7%. Approximately 98% of the population was exposed to levels exceeding WHO limits. Exposure to ozone has caused the premature death of an estimated number of 17,700 persons in 41 countries in 2015. In 2016, 17% of the measurement stations in the EU recorded concentrations above the ozone (O3) values considered harmful to human health. Exposure to concentrations above the admitted limit of SO2 (sulphur dioxide) has decreased in the recent years. 23 monitoring stations reported in 2016 for SO2 an overrun of values accepted by the EU. In turn, a much higher number of stations reported an overrun of the much stricter values imposed by WHO, which has determined 23% of the urban population of the EU to be exposed in 2016 to much higher concentration than the limit value accepted. • Population exposure to CO (carbon monoxide) concentrations above the EU value is limited and rare; • Exposure to C6H6 concentrations (benzene) is limited to a few areas where there is intense traffic or industrial platforms; • Exposure to high concentrations of As (arsenic), Cd (cadmium), Pb (lead) and Ni (nickel) is limited to some areas in Europe and is usually caused by certain industrial or energy centers. In Europe, the emissions of many atmospheric pollutants have fallen substantially in recent decades, leading to an improvement in air quality in the region. However, concentrations of atmospheric pollutants continue to be very high, and air quality problems persist. A significant proportion of Europe’s population lives in areas, particularly cities,

where overruns of air quality standards occur: ozone, nitrogen dioxide and particulate matter (PM) pollution pose serious health risks. Several countries currently exceed one or more emission limits for four major air pollutants. Consequently, the reduction of air pollution remains an especially important target. The EU’s long-term objective is to achieve levels of air quality that do not affect or induce unacceptable risks to human health and the environment. The EU acts on several levels to reduce exposure to air pollution: through legislation; through cooperation with the sectors responsible for air pollution, as well as with international, national and regional authorities, non-governmental organizations and through research. EU policies aim to reduce exposure to air pollution by reducing emissions and by setting limits and target values for air quality. At the end of 2013, the European Commission adopted the Air Quality Package, which includes new measures to reduce air pollution. In the Communication entitled ‘A Europe that protects: Clean air for all’, adopted in May 2018, the European Commission presents the measures available to help Member States combat air pollution. The Commission also highlights the need to step up cooperation with Member States by working with relevant authorities in new clean air dialogues and by using EU funds to support measures to improve air quality. The measures proposed by the Commission are based on three main pillars: air quality standards; national targets for reducing greenhouse gas emissions and emission standards for the main sources of pollution, e.g. from ships and vehicles, to the energy sector and industry. In order to address the emissions of air pollutants from road traffic, the Commission will continue to strengthen its cooperation with national, regional and local authorities on a common integrated approach to urban vehicle access regulations in the EU Urban Agenda. 89

ÂŠ CEEP

EVENT

Tremendous accomplishments of cross border energy cooperation in Central Europe 90

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EVENT

entral European countries have C achieved significant results in the field of cross-border energy cooperation, both in gas and electricity sectors. A key reason for this progress is the increasing infrastructural interconnectivity and integration of the markets. There has also been remarkable progress achieved in the synchronization of the Baltic States with the continental European network. What’s more, due to the liberalisation processes and legal system in place, cross-border trade is growing dynamically in the region. These were the main conclusions of the 3rd Central European Day of Energy Conference held on the 5th of November in Bruxelles. Vice-President of the European Commission in charge of the Energy

Union, Mr. Maroš Šefčovič pointed out that it is now clearer than ever that a single well-integrated energy market is a prerequisite for Europe for building a future-proof low-carbon economy. It is a prerequisite for facing the challenges of the 21st century; notably climate change, pollution, and the modernisation of our entire economy. No EU country can handle any of these challenges on its own; not in the West, nor in the East. Regional cooperation is a necessity. Given that Central European states have already acquired a strong level of interconnection and integration, Chairman of the Board of Directors of CEEP, Mr. Leszek Jesień stressed the importance of cooperation in the electricity sector as demonstrated by the example of Regional Security Coordinators (RSC). “The regional cooperation should follow bottom – up logic. In this regard the EU support and coordination is one of the crucial factors facilitating it. Flexibility, however, remains a key feature enabling the enhancement of the cooperation. On the other hand, administratively imposed obligations and measures would not guarantee desired outcomes.” The agenda for regional cooperation in Central Europe is becoming more ambitious. Firstly, it focused mainly on gas infrastructure interconnections to ensure security of supply. Currently and increasingly its aim is proper management of electricity flows, development of smart solutions and innovations which support cost-efficient energy transition in theregion,” stressed Mr. Jerzy Buzek, Member of the European Parliament, and Chair of the ITRE Committee. CEEP members and other stakeholders from the EU-11 that have participated at the high-level conference debated different aspects and scopes of the cooperation. The discussions centred around the appropriate administration of the flows, the need for an accurate institutional framework, bidding zones delimitation and better coordination of cross-border trade. The participants agreed in principle that most effective solutions to the problems related to

transmission and supply are possible mainly at the regional level. “Regional cooperation is a key element of the European Energy Policy and an indispensable stepping stone for the establishment of a truly European Internal Energy Market. Thanks to the regional cooperation, through the Connecting Europe Facility, the Central European countries are improving their level of interconnectivity and their functional resilience in particular markets. The intensive and comprehensive projects and initiatives in the region are not only beneficial for Central European countries but, as a consequence, for the entire European Union Energy Market,” commented Mr. Dominique Ristori, Director-General of DG Energy. Central European Day of Energy showed the need for discussion on region-related problems and challenges. During the event, the speakers focused on the ongoing and future projects which connect the markets and make the region more economically resilient. “We should however remember that not all the projects have been concluded so far. There is still a need for EU financial support in form of CEF and other funding mechanisms for development of new infrastructure. Thus, in the coming EU financial perspective, sufficient resources shall be guaranteed for this purpose,” concluded Maciej Jakubik, Executive Director of CEEP. Central European Day of Energy 2018 was organised by the Central Europe Energy Partners in cooperation with the European Commission (DG Energy), with the support of International Visegrad Fund and under the auspices of the Slovak Presidency of the Visegrad Group, on the 5th of November in Brussels. This third edition of the conference was prepared in cooperation with partners from the Czech Republic (Masaryk University), Hungary (REKK), Lithuania (Vytautas Magnus University), Poland (Sobieski Institute), Romania (Romania Energy Center), Slovakia (Slovak Foreign Policy Association), Bulgaria (Center for the Study of Democracy) and Croatia (Institute for Development and International Relations). 91

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PETEC 2018 Today, natural gas - considered an ideal partner for renewable energy generation in a future sustainable energy mix - provides one quarter of the EUâ&#x20AC;&#x2122;s energy demand. According to most forecasts, gas will continue to play a key role alongside renewables in helping to meet future energy requirements. In this context, technology seems to be the right ally in fighting climate change. The role of natural gas and renewables in a fastevolving energy market towards achieving the 2030 Agenda and the Sustainable Development Goals represents the main theme for the Power & Energy Tech Exhibition and Conference Vision 2030 - PETEC. 92

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Opening panel ‘Playing the field’ From right to left: Lavinia Iancu – Publisher Energy Industry Review; Niculae Havrilet – Councillor to the Minister of Energy; Iulian-Robert Tudorache – State Secretary, Ministry of Energy; Anton Anton Minister of Energy; Shohrat Jumayev - Turkmenistan Ambassador in Romania; Hamza Karimov – CEO SOCAR Romania; Alexandra Militaru - Director International Cooperation – Transgaz; Viorel Vasiu – Member of the Board of Directors, Transelectrica

ETEC takes a leadership P role with the introduction of a dedicated conference and exhibition that covers a range of new technologies, including Artificial Intelligence, Machine Learning, IoT, Big Data Analytics, Edge Computing, Blockchain across the energy sector. Held under the high patronage of Romania’s Ministry of Energy in partnership with NAMR and ANRE, the recently concluded conference brought together high-level officials, top executives, energy experts from across the full value chain. There has been a spate of developments involving major players on the energy market. Top power & energy business leaders have addressed commercial, regulatory,

geopolitical and technical challenges impacting the future of the power and energy industry. Major topics in focus were: Romania’s place on the European energy market ⁄ The Black Sea - How to capitalize on its favourable position on the regional geopolitical map ⁄ Unlocking Romania’s onshore and offshore hydrocarbon potential ⁄ Securing Europe’s future energy supply - Connecting production to markets ⁄ Electricity and gas interconnections around the Black Sea Region ⁄ Clean Energy Package challenges and opportunities ⁄ Emerging business models for a competitive market ⁄ Critical insights into Romania’s energy businesses ⁄ Regulatory framework to stimulate innovation and investment ⁄ The disruptive 3D’s impact on the energy transition to a low carbon economy ⁄ Smart solutions to maximize efficiency, reduce costs and CO2 emissions ⁄ State-of-the-art technologies transforming the energy lifecycle ⁄ Energy efficiency first - Smart toolbox for sustainable growth and communities. The conference was held over two days, structured as two Panel Discussions, a Strategic Session and two Technical Sessions. Discussions and presentations held within the conference covered topical issues and occasioned exchanges of ideas and opinions in a warm and balanced atmosphere. Also, in the specially arranged space, the participants had the opportunity to talk with the exhibitors and to get informed about the products and services offered by them.

KEY TAKEAWAYS - Strengthening regional and global cooperation is the only way to transform the wider Black Sea region from a region of confrontation into a bridge between peoples and cultures. Romania considers cooperation between riparian countries as the optimal solution for confidence building in the wider Black Sea region. - Romania wants its status as a strategic region and aims at integrating the national market into the European energy market. - Gas extracted from the Black Sea should be used in the re-industrialization process, not as raw material. - Investment interest should focus on retrofitting, upgrading existing capacities and developing new interconnection capacities at regional level. - Essential condition for encouraging investors: providing a stable, predictable, favourable and transparent framework from a technical, economic, commercial, legal, social and environmental point of view. - The National Energy Strategy focuses on: the vision of how resources are being exploited; integration with neighbouring transmission networks; the role of Romania as a factor of stability in the region. - The future of energy systems will be under the footprint of the 3 D - decentralization, decarbonisation, digitization. - Adoption of state-of-the-art technologies is essential for the transition to a low carbon economy in the information age. 93

Top of the Bucharest companies A quarter of a century of recognized performance “Following its tradition of initiator of the modern Romanian economy institutions, the Bucharest chamber has awarded for the last 25 years the consistency of development and the contribution to building a complex economic tissue with a measurable impact on the evolution of the social-economic ecosystem. More than the representation of the business community’s interests and our general objectives, we took another important role: that of raising awareness of projects, business ideas, management styles which will inspire and motivate the new wave of entrepreneurs 94

in order for them to take the Romanian economy a step forward and to contribute to the reduction of disparities related to the west economies,” stated Professor Sorin Dimitriu, Ph.D., the President of the Bucharest Chamber in the opening of the twenty-fifth edition of the Top of the Bucharest companies. The event was also attended by important personalities from the academic world, officials from the administration and non-governmental organization, along with successfully

businessmen. Amongst the personalities that have honoured the Bucharest Chamber’s invitation, were Professor Emil Constantinescu Ph.D., former president of Romania, Professor Eng. Ecaterina Andronescu, senator and president of the Politehnica University senate, Mrs. Paula Parvanescu, secretary of state at the Ministry for Business Environment, Commerce and Entrepreneurship, Professor Nicolae Istudor, Ph.D. rector of the Economic Sciences Academy (ASE), Mr. Mihnea Costoiu, rector of the energyindustryreview.com

Politehnica University (UPB), Professor Eng. Anton Hadar Ph.D., vice-president of the Politehnica University’s senate, Mr. Virgil Popescu, vice-president of the Services and Industry Committee in the Chamber of Deputies, Mr. Bogdan Chiritoiu, president of the Competition Council, Mr. Andrei Dimitriu, general director of the ‘George Enescu’ philharmonic, Mr. Marian Tiganus, deputy mayor at the 5th district city hall, Mr. Mihai Ionescu, president of the National Association of Exporters and Importers, Mr. Nicolae Mirica, general secretary at the Liberal Professions Union in Romania, Mr. Sterica Fudulea, member of the Permanent Council of the National Council for Private SMEs. According to the methodology of the top, out of 130,653 companies with their headquarters in Bucharest, which have registered their balance sheet for 2017, 41,987 companies have fulfilled the requirements, meaning 32.1% of the total companies. Amongst them, the Bucharest Chamber awards 6,922 companies, meaning 16.5% of the total eligible companies. In order to make this ranking process objective, the winning companies were structured on 7 different activity sectors: research, development and hightech, industry, constructions, services,

commerce, tourism, agriculture, fishing, fish farming, and in each category, they were divided into 5 different sizes: very big companies, big companies, medium companies, small companies and very small companies. A very important fact to highlight is that among the 6,922 companies awarded by the Bucharest Chamber, 3,380 entered the national top, representing 27% of all the companies awarded in Romania. The statistical data indicates the fact that 54% of the entities awarded at the national level in the sector of research, development and high-tech come from Bucharest, as well as 40% of the tourism companies, 37% of the companies activating in the services sector and 34% of trade companies. Besides the prizes awarded for the economic results obtained in 2017, during this event Excellency trophies were also given to companies which were ranked the first in the elite competition during the last 5 years, ZAREA S.A. was awarded the ‘George G. Assan’ trophy for the ‘Romanian brand of the year’ and Digi 24 television was awarded the ‘Ioan V. Socec’ trophy for the ‘Romania fast forward’ project. Furthermore, a series of excellency trophies were also given to: the Politehnica University in Bucharest

(UPB) for the 200 years dedicated to the teaching of young people, Romania Radio Actualitati for 90 years of activity in the public sector, National Press Agency, AGERPRES – for objectivity and professionalism in the reflection of the economic phenomenon, Antena 3 television - Income Magazine Show, for the promotion of quality economic information, National Television (TVR) – Investments in Romania Show, for the promotion of business opportunities offered by our country, Bucuresti FM, for the project called ‘I choose Romania’, the Institute for Research and Development of the Mechatronics and Measurement Technique (INCDTM), for supporting the development of the research. Five excellency diplomas were awarded as follows: Mr. Iancu Guda, for the project called ‘Why do companies fail. 10 mistakes and 100 solutions’, Mr. Constantin Rudnitchi, RFI for the Business on Air show, Mr. Rasvan Roceanu, Bucuresti FM, for the ‘Business Street’ show, Mrs. Florentina Varga, Radio Romania Actualitati for objectivity and professionalism in reflecting the economic phenomenon and Mr. Alexandru Rusu, Radio Romania Actualitati, for the ‘Night Service’ show. 95

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ENERGY TRANSITION 2018

he second edition of the Energy Transition conference T organized by the Romanian Wind Energy Association (RWEA) has addressed global and European challenges related to the ongoing evolution of the energy sector and especially those with a direct impact on renewable energy, focusing on the specifics of the wind energy sector in Romania. The event created the opportunity for the European Commission’s representatives, public bodies, politicians and companies in the energy sector to debate the most recent developments of the Energy Package ‘Clean Energy for All Europeans’ within the context of drafting the Integrated National Energy and Climate Plan and of the future Romanian Presidency of the Council of the European Union. “Romania should harness onshore wind to meet growing demand for electricity instead of investing in conventional power” – this was the message WindEurope CEO Giles Dickson told the annual meeting of the Romanian Wind Energy Association in Bucharest on October 30. Wind energy provided 12.2% of Romania’s electricity last year. With a more flexible grid and interconnectors to neighbouring countries, the share of wind and other renewables in Romania’s electricity could rise to 35% by 2030. This potential should be reflected in the draft National Energy and Climate Plan that Romania (and all EU countries) must submit to the European Commission by the end of 2018. The International Renewable Energy Agency has highlighted the enormous potential for wind energy in South East Europe: 532 GW. But this potential is not being realised in Romania and in the wider region because regulatory uncertainty has pushed up the cost of capital. Romania has the opportunity to drive ambition on renewables in the region when it takes over the EU Presidency in January 2019. “With electricity demand predicted to rise in Romania, the country urgently needs to invest in new power capacity. Onshore wind is now the cheapest form of new power in Romania and many parts of Europe. And it’s reliable. And it’s getting easier and cheaper to integrate it in the energy system. That’s why so many corporate and industrial power 96

Romania to reap the rewards of wind

consumers are now buying wind energy. Making huge investments in old fossil fuel technology today makes no economic sense whatsoever. Wind and other renewables could cover up to 35% of Romania’s electricity by 2030, provided there are more flexible grids and with the help of interconnectors to Romania’s neighbours,” WindEurope CEO Giles Dickson pointed out. “According to the International Renewable Energy Agency, there’s huge potential for wind in South East Europe: 532 GW. But this is largely untapped, despite the green shoots of growth appearing in Serbia, Croatia, Ukraine and Greece. And in Bulgaria, where the government recently passed a law allowing for corporates to sign Power Purchase Agreements. This is because wind farms in Romania and the region cost most than in North West Europe – because recent regulatory uncertainty mean investors demand higher costs of capital. To address this, we urge governments in the region to give clarity on their renewables plans and legislation in their 2030 National Energy and Climate Plans. The National Plans should cover the integration of regional energy markets, the development of joint renewable energy projects and long-term decarbonisation and electrification strategies. Investments, economies of scale and cost reductions will only happen when the industry is assured of stable policy and regulation,” Dickson added. energyindustryreview.com

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ontinuing the tradition, the C Association of Electricity Suppliers in Romania - AFEER organized on 15 November the fourth edition of the Annual Conference, with the theme ‘We supply for the future’. In an ever-changing world, where technology and information affect all industries, AFEER proposes themes of topical debate and with major implications for the future. ‘How will the future of electricity suppliers look like in an Energy Union?’ and ‘Challenges of the future: smart technologies and innovative solutions’. There are many questions and answers are being sought. “We are trying to decipher how Romania understands integration into a single energy market, we analyse the evolution of the Romanian market in a European context, the latest trends in the field and especially the challenges of a technological and digital future. Liberalization, the new Legislative Package proposed by the European Commission ‘Clean energy for all Europeans’, the Energy Union, digitization, they all come with new challenges, as well as opportunities for energy suppliers. Suppliers are therefore forced to constantly change, to reinvent themselves, to come up with new products and services to meet the increasingly sophisticated requirements of consumers. Thus, they need to adapt their strategies in order to cope with fierce competition, but with beneficial effects for the energy market and

The fourth edition of the annual conference of AFEER

for the whole economy,” says Ion Lungu, President of AFEER. All market participants are required to adapt to the new conditions. “As it happens in most countries, including in Romania, regulations are behind the new technological discoveries. Unfortunately, the Romanian legislation has become more rigid and too bureaucratic. Too easily, without serious impact studies, invoking prevention, starting from isolated cases of improper market behaviour, a number of interdictions appear in the legislation on how energy is traded, the clauses of commercial contracts, the content of bills. AFEER urges authorities to respond to the technological revolution with a legislative revolution. We believe that

it is necessary to radically review the primary and secondary legislation of the energy sector. For example, more flexibility of contracts on the wholesale market will bring benefits not only for suppliers, but, through the lower costs, the main beneficiaries will be precisely the consumers,” Mr. Ion Lungu says. The annual conference of AFEER brought together this year representatives the most important institutions in the field - Parliament, Ministry of Energy, ANRE, as well as of energy companies, energy experts in the country and abroad, suppliers - members of AFEER, in order to continue the dialogue started on the occasion of the first edition. 97

NOVEMBER’S READING

Russia’s gas pivot to Asia: Another false dawn or ready for lift off? ussia’s pivot to Asia has taken R a long time to mature in the gas sector, but 2019 is set to be an important year as the Kremlin seeks to diversify its sources of export revenues. The Power of Siberia pipeline is due to come onstream at the end of the year, and before then agreements on two further export routes may also have been signed. The history of energy negotiations between the two countries suggests that caution is needed, but it would appear that both political and economic reasons could catalyse action on the Power of Siberia 2 (Altai) and Far East pipeline export schemes. In addition, Russia-China cooperation over LNG projects in the Russian Arctic could also develop further, with commercial and geo-political consequences. The energy insight ‘Russia’s gas pivot to Asia: Another false dawn or ready for lift off ?’ by James Henderson from the Oxford Institute for Energy Studies (OIES) addresses the latest 98

developments in this emerging story and considers the consequences for European consumers and the global LNG market. One consequence of the increasing antipathy towards Russian gas in Europe has been a natural search for alternative markets in order to diversify export risk. The obvious region to turn to, given its tremendous growth potential and its more benign political views towards Russia, has been Asia and, in particular, China. Serious negotiations about gas exports have been underway since 2004 but were energised by political and commercial forces in 2014. The Ukraine crisis and the imposition of sanctions on Russia by the US and EU encouraged the Kremlin to turn towards friendlier neighbours, while the surge in Chinese gas demand and a desire for a diversity of import options encouraged the authorities in Beijing to become more enthusiastic about Russian gas. The result was a 38Bcm per annum

contract signed in May 2014 for gas to flow from East Siberia via the Power of Siberia pipeline to North-East China, with Gazprom and China National Petroleum Corporation (CNPC) as the key protagonists. Initially it appeared that the deal was born more of desperation than economic logic on the Russian side, with the Chinese having all the bargaining power, but over time the pendulum seems to have swung somewhat in Russia’s favour, with the prospects for both pipeline and LNG exports to the East improving markedly. As a result, although caution and scepticism are always merited when considering negotiations between Russia and China, it would seem that gas sector relations may be on the cusp of a potential ‘great leap forward’. See the paper here: https://www. oxfordenergy.org/wpcms/wp-content/ uploads/2018/11/Russias-gas-pivot-toAsia-Insight-40.pdf energyindustryreview.com