New Fortress Invests $400 Mln in Pilot Project

(Jamaica Observer, 15.Jul.2018) – New Fortress Energy announced on Friday a new partnership with Jamaica Urban Transit Company (JUTC) for the introduction of the first natural gas-powered buses in Jamaica, which will significantly reduce emissions, pollution, maintenance and fuel costs.

As part of the partnership with the Government of Jamaica, New Fortress Energy will fund the pilot project for the conversion of five buses operated by JUTC to run on clean-burning liquefied natural gas (LNG) by early 2019.

The pilot programme, which consists of five new LNG-powered buses and a fuelling station in Kingston, is estimated to cost close to $400 million.

The new buses will reduce emissions and pollution and are expected to operate more efficiently, furthering the Government’s efforts to achieve energy diversification for sustainable economic growth and better protect the environment.

“We’re delighted to partner with the Government of Jamaica to introduce clean, reliable and affordable natural gas to the public transportation sector,” said Wes Edens, founder and chairman of New Fortress Energy.

“This partnership will be a catalyst for the transportation industry to reduce harmful emissions and pollution by using cleaner fuels. Jamaica continues to set an example with transformative energy investments that help grow the economy and protect the environment.”

Meanwhile, Minister of Transport and Mining Bobby Montague said, “We look forward to the conclusion of this pilot, using LNG-powered buses. We are very encouraged and excited about this groundbreaking initiative that will greatly enhance our environment. The Government is committed to support, create and enable the implementation of this pilot project. We anxiously await the results, so that a proper technical review can be done and chart a new pathway.”

He further noted that New Fortress Energy is funding five new buses so that the results of the pilot programme are not skewed by other factors.

The buses will be deployed across the system, and the ministry, along with JUTC stakeholders will be looking at the results to assess the success and viability.

In agreeing with the Minister, Paul Abrahams, managing director for JUTC, said; “This is indeed a significant milestone for our transport system and importantly, for our environment. We are very excited about it and look forward to the results post-pilot.”

Known as one of the safest, non-polluting and non-toxic fuels, LNG is an odorless fuel that offers significant energy efficiencies and emission reductions over alternative fossil fuel sources. It is cooled to a liquid form at -260°F and stored at atmospheric pressure, making it safe to handle and transport across the world.

The introduction of LNG as a clean and safe alternative fuel source in Jamaica is expected to lower energy costs and reduce environmental impact.

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US to Become World’s Top Oil Producer

(AP, 15.Jul.2018) – The United States has nosed ahead of Saudi Arabia and is on pace to surpass Russia to become the world’s biggest oil producer for the first time in more than four decades.

The latest forecast from the US Energy Information Administration predicts that US output will grow next year to 11.8 million barrels a day.

“If the forecast holds, that would make the US the world’s leading producer of crude,” says Linda Capuano, who heads the agency, a part of the US Energy Department.

Saudi Arabia and Russia could upend that forecast by boosting their own production. In the face of rising global oil prices, members of the Organization of the Petroleum Exporting Countries cartel and a few non-members, including Russia, agreed last month to ease production caps that had contributed to the run-up in prices.

President Donald Trump has urged the Saudis to pump more oil to contain rising prices. He tweeted on June 30 that King Salman agreed to boost production “maybe up to 2,000,000 barrels”. The White House later clarified that the king said his country has a reserve of 2 million barrels a day that could be tapped “if and when necessary”.

The idea that the US could ever again become the world’s top oil producer once seemed preposterous.

“A decade ago, the only question was how fast US production would go down,” said Daniel Yergin, author of several books about the oil industry, including a history, The Prize. The rebound of US output “has made a huge difference. If this had not happened, we would have had a severe shortage of world oil,” he said.

The United States led the world in oil production for much of the 20th century, but the Soviet Union surpassed America in 1974, and Saudi Arabia did the same in 1976, according to Energy Department figures.

By the end of the 1970s, the USSR was producing one-third more oil than the US; by the end of the 1980s, Soviet output was nearly double that of the US.

The last decade or so has seen a revolution in American energy production, however, led by techniques including hydraulic fracturing, or fracking, and horizontal drilling.

Those innovations – and the break-up of the Soviet Union – helped the US narrow the gap. Last year, Russia produced more than 10.3 million barrels a day, Saudi Arabia pumped just under 10 million, and the US came in under 9.4 million barrels a day, according to US government figures.

The US has been pumping more than 10 million barrels a day on average since February and probably pumped about 10.9 million barrels a day in June, up from 10.8 million in May, the energy agency said Tuesday in its latest short-term outlook.

According to the Energy Department, the US edged ahead of Saudi Arabia in February and stayed there in March; both trailed Russia.

Capuano’s agency forecast that US crude output will average 10.8 million barrels a day for all of 2018 and 11.8 million barrels a day in 2019. The current US record for a full year is 9.6 million barrels a day in 1970.

The trend of rising US output prompted Fatih Birol, executive director of the International Energy Agency, to predict this spring that the US would leapfrog Russia and become the world’s largest producer by next year – if not sooner.

One potential obstacle for US drillers is a bottleneck of pipeline capacity to ship oil from the Permian Basin of Texas and New Mexico to ports and refineries.

“They are growing the production, but they can’t get it out of the area fast enough because of pipeline constraints,” said Jim Rittersbusch, a consultant to oil traders.

Some analysts believe that Permian production could decline, or at least grow more slowly, in 2019 or 2020 as energy companies move from their best acreage to more marginal areas.

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