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West Karoun: fields with promise for Iran’s oil industry



In the last few years, especially after the implementation of the nuclear deal (known as the Joint Comprehensive Plan of Actions or JCPOA), Iran’s oil industry has been strongly focused on developing joint oil and gas fields, aiming to increase the seven-percent share of such fields in the country’s oil production.

In this regard, West Karoun oilfields which Iran shares with Iraq at the western part of Iran’s southwestern region of Karoun, have been prioritized among the country’s top development projects.

After the implementation of JCPOA in January 2016, Iranian oil industry once again broke free from the shackles of pressure which held it back from its full potential since January 2012, in which the EU agreed to an oil embargo on the country.

Immediately after the removal of the sanctions, Iranian government put it on the short term agenda to hastily increase its oil production to reclaim its oil market share lost to the fellow OPEC members due to the restrictions imposed by the West.

In doing so, plans were made for continuous increase in the country’s oil output and also development of new fields.

Following the new policies for attracting foreign investors to develop the country’s fields, in 2016, Iran introduced the Iran Petroleum Contract (IPC), which replaced the old buyback model.

Shortly after, National Iranian Oil Company (NIOC) announced that the company is in serious talks with potential foreign suitors in order to hold tenders to hand out the development projects mostly for shared fields.

According to the oil ministry’s planning, West Karoun region which includes five major fields namely North Azadegan, South Azadegan, North Yaran, South Yaran and Yadavaran, was introduced as the main candidate for the new IPC tenders.

According to the managing director of Petroleum Engineering and Development Company (PEDEC), the oil ministry targeted an output of 700,000 barrels per day (bpd) for this region, by the end of the Iranian calendar year of 1397 (March 2019).

However, the initial enthusiasm did not lead to any entrust and since mid-2016 which IPC was introduced, still no tender has been held.

Although NIOC have repeatedly said in 2017 that international energy companies including France’s Total, Malaysia’s Petronas and Japan’s Inpex are eager for the development of the Azadegan field, the tender has been postponed several times for unspecified reasons.

West Karoun holds great importance for the country’s oil industry since according to the latest studies, its in-situ deposit is estimated to be 67 billion barrels containing both light and heavy crude oils, and therefore it could have a big impact on Iran’s oil output increases in the future.

With the fields fully operational, their output could add 1.2 million bpd to the country’s oil production capacity.

The complete development of the West Karun oilfields will require about $25 billion of investment, of which only about $7 billion has been funded and spent in implementation and development plans so far.

Considering the fact that West Karoun fields are still young, pristine and untapped reservoirs (also called green fields), the government should increase the efforts to attract the necessary investment for developing these fields.

Since most of the country’s already active fields are old and obviously with aging, the recovery factor decreases resulting in a lower production rate, increasing production level requires either new technologies to keep the recovery factor from falling or new fields coming on stream.

So, again considering the issues regarding banking relations, entering new technologies would be rather a challenge for the oil ministry, thus as it is already prioritized, young and untapped oilfields should be given extra attention in the ministry’s future planning to increase oil output.

Having an estimated 67 billion barrels of in-situ oil, West Karoun fields definitely deserve the spotlight which has been put on them recently.

Hopefully, in the new Iranian fiscal (which starts on March 21), the tender for development of the Azadegan oilfield, which is the first of its kind, won’t get postponed any further and the 10 IPC deals which were promised by the oil minister to be signed by March 2018 will go through by the yearend.

First published in our partner Tehran Times

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Energy is at the heart of the sustainable development agenda to 2030

Dr Fatih Birol



Three years ago, all countries of the world adopted 17 ambitious policy goals to end poverty, protect the planet, promote gender equality, or ensure prosperity, as part of the United Nations Sustainable Development Agenda, and vowed to achieve specific targets by 2030.

Energy is at the heart of many of these Sustainable Development Goals – from expanding access to electricity, to improving clean cooking fuels, from reducing wasteful energy subsidies to curbing deadly air pollution that each year prematurely kills millions around the world. One of these goals – commonly known as SDG 7 – aims to ensure access to affordable, reliable, sustainable and modern energy for all by the end of the next decade.

All these topics are fundamental to the work of the International Energy Agency. As the world’s leading energy authority, the IEA has unmatched analytical capabilities based on its unique data collection, technological network, research, and policy recommendations, which we put in the service of understanding the energy system. As I have often said – in the world of energy, data always wins.

The adoption of energy specific sustainable development goals was a milestone in moving the world towards a more sustainable and equitable system. The IEA continues to support this critical goal with unbiased data and projections. This has long been a personal and professional priority for me. Fifteen years ago, we recognized this basic fact when we first compiled data for electricity access and mapped out a scenario for delivering universal electricity access by 2030 in the World Energy Outlook, the IEA’s benchmark publication.

As a result, the IEA has been tracking country-by-country progress on energy access (SDG 7.1) on an annual basis since 2002. As the world’s most authoritative source of energy statistics, the IEA is also the lead custodian agency for reporting progress towards substantially increasing the share of renewables in the global energy mix (SDG 7.2) and doubling the global rate of improvement in energy efficiency (SDG 7.3).

The United Nations will have the first in-depth review of SDG 7 goals at the High-level Political Forum on Sustainable Development organized in New York, in July this year. This will be a good time to assess where we stand with our global energy goals, where existing national policies are taking us, and how to steer the global energy system towards a more sustainable path. To assist this critical process, the IEA has decided to create a new online resource to centralize all of our data and scenario projections in support of the 2030 Agenda.

It is clear that the energy sector must be at the heart of efforts to lead the world on a more sustainable pathway. But our data and analysis show that the current and planned policies fall well short of achieving our critical energy-related sustainable development objectives.

There has been tremendous progress in delivering universal electricity access (SDG 7.1.1) in Asia and parts of sub-Saharan Africa, with the number of people without access declining to 1.1 billion in 2016, from 1.7 billion in 2000. But on the basis of current progress, more than 670 million people are still projected to be without electricity access in 2030. Much work remains to be done in this field.

The picture is even dimmer when it comes to access to clean and modern cooking facilities (SDG 7.1.2). About 2.8 billion people rely on polluting biomass, coal and kerosene to cook their daily meals, a number which has not changed since 2000. Without greater ambition, 2.3 billion will still remain without clean cooking access in 2030, with grave health, environmental and social consequences.

The share of modern renewables in global final energy consumption (SDG 7.2) has been growing steadily in the past decades, reaching nearly 10% in 2015. However, to achieve a truly sustainable energy system, this share needs to more than double to 21% by 2030. But while wind and solar deployment has accelerated, thanks to falling costs and policy support in many parts of the world, this goal is still out of reach under current policies.

Finally, 2015 was an impressive year for energy efficiency (SDG 7.3), with global energy intensity falling by 2.8%, the fastest annual improvement since 1990. However, the average improvement between 2000 and 2015 of 2.2% still falls short of the 2.6% target needed to achieve the SDG target, and the 3.4% annual improvement needed to meet more ambitious long-term climate objectives.

Tracking progress towards these goals is only one aspect of our sustainable development work. Through our new Sustainable Development Scenario, introduced in 2017, we also seek to map an integrated path for achieving critical global goals in the next three decades: delivering universal energy access by 2030, an early peak in carbon emissions (SDG 13), and reducing deadly air pollution (SDG 3). One of the main finding of this new scenario is that these three goals are not incompatible. Indeed, our analysis shows they can successfully be met together.

But there is an urgent need for action on all fronts, especially on renewables and energy efficiency, which are key for delivering on all three goals – energy access, climate mitigation and lower air pollution. The IEA is committed to keep leading this agenda, and stepping up efforts to support the clean energy transition. We will do so with our unparalleled data, unbiased analysis, and our determined policy support to help move the world towards delivering the 2030 Agenda.

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Reducing Greenhouse Gas Emissions through Energy Efficiency – and Learning from One’s Peers

MD Staff



China, India, Indonesia, the Philippines, Pakistan, and Vietnam are critical for global climate action. Why? Among other reasons, because three-fourths of all new coal-fired power plants to begin operations before 2020 globally will be in these six Asian countries. Fostering more energy efficiency will be imperative in the countries’ efforts to adopt a low carbon energy path.

One initiative that supports efforts to scale up energy efficiency and clean energy – and lower greenhouse gas emissions – in these six countries is the Energy Transition in Asia program managed by the Energy and Extractives Global Practice.

Comprising of knowledge exchange and capacity building on key issues, the program recently held a workshop in Singapore to share lessons learned on energy efficiency, following last year’s learning forum on solar auctions, also held in the city-state. Participants agree that peer-to-peer learning works. After sharing best practice efforts in China, India, Japan, Korea, Mexico, the United Kingdom, and host country Singapore, team spirit and friendships strengthened, along with confidence, productivity and learning outcomes.

By the end of the three-day workshop, participants from governments not only requested follow-up assistance but also to learn more from their newfound friends about conserving more energy. “We were able to advance country engagement with the clients on energy efficiency,” explained Xiaodong Wang, team leader for the Energy Transition in Asia initiative. “Conducive policies that combine mandatory regulations with financial incentives are essential drivers to create market demand for catalyzing investments in energy efficiency.”

Results are already encouraging. China is a leading example. From 1990 to 2010, more than half of global energy savings took place in China, thanks to the government’s ambitious targets, stringent regulatory policies, generous financial incentives, and effective institutions – all of which reiterate strong commitment to energy efficiency. Reducing energy intensity was made a mandatory target, allocated to each province and 17,000 energy intensive enterprises. Efficiency standards for appliances, buildings, and vehicles were upgraded and complemented with billions of dollars of financial incentives in output-based subsidies, rebates for energy efficient consumer products, and compensation for the phase-out of inefficient stocks. All these efforts were monitored across the country.

India also led by example. Energy savings targets – at least for energy intensive industries – were made mandatory with the Perform, Achieve, and Trade scheme (PAT), which also allows the trade of Energy Savings Certificates to achieve targets in a least-cost way. Non-compliance at the end of the three-year cycle incurs a financial penalty. The results of the first phase surpassed targets. The second phase began in April 2017.

Workshop participants from India reminded, however, that these are early years. Following a visit to the district cooling system under Marina Bay Sands – the world’s largest underground facility and its most efficient – S.P. Garnaik, Chief General Manager of India’s Energy Efficiency Services Ltd. (EESL), a joint venture under the Ministry of Power, envisioned replicating such a system in India. But while a policy framework is being prepared to support the use of district cooling systems in rapidly urbanizing India, Garnaik admits that substantial results may take time, as “these are very new concepts.”

In addition to the mandatory output-based target approach in China and India, participants also noted Singapore’s green mark program, which combines mandatory building codes with financial incentives from the government for auditing and investment costs, as a model to emulate.

Indeed, the knowledge gap between participating countries is large. Yet even countries in the ‘nascent’ phase are eager to make progress.

Energy intensity in Asia is highest in Vietnam, with energy consumption by industry accounting for almost half of the country’s total energy use. Current efforts towards energy efficiency are encouraging. Labeling schemes have been established and energy management systems now require energy managers and auditors in large energy users. Indonesia is implementing a similar  system.

Learning from one’s peers can be galvanizing. As Trinh Quoc Vu of Vietnam’s Energy Efficiency and Sustainable Development Department at the Ministry of Industry and Trade explains, Vietnam is eager to learn from China’s and India’s shift to a mandatory target approach. Indonesia’s delegates were inspired by their peers’ experience in expanding pilot programs. The Bank is providing advisory services to both Indonesia and Vietnam in their efforts to scale up energy efficiency.

The workshop also highlighted the critical role of strong government support in developing the ESCO business. ESCOS are energy service companies which design and implement energy savings projects.  Energized by his peers, Trinh is now intent on exploring mechanisms for promoting and incentivizing the ESCO business in Vietnam.

The World Bank Group supports many energy efficiency financing mechanisms worldwide, including through credit lines, risk sharing facilities, dedicated funds, program-for-results (PforR), and development policy loans. Critical to success is a strong pipeline for deal flows, as well as technical assistance.

In India, the Partial Risk Sharing Facility for Energy Efficiency initiative, financed by the Clean Technology Fund (CTF) and Global Environment Facility (GEF) resources,  is supporting private sector ESCO-implemented energy efficiency projects through partial credit guarantees. The proposed new US$300 million India Energy Efficiency Scale Up Operation with EESL is expected to leverage over $1.5 billion of demand side energy efficiency investments across residential and public sectors. Similarly, the China Energy Efficiency Financing Project has leveraged the original World Bank financing eight times over, with a total investment of US$2.6 billion. The project has led to an annual reduction of 11 million tons of CO2 emissions.

Such figures may seem ambitious, but workshop participants were unfazed. Many are confident they will accomplish similar achievements. When learning from one’s peers, who all face challenges in their respective development journey, anything can seem possible.

World Bank

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The Sustainable Energy Forum for East Africa 2018

MD Staff



The Sustainable Energy Forum for East Africa, a key event for promoting access to renewable energy sources in the region, will take place between 19 and 21 March 2018 in Kigali, Rwanda.

Leaders from governments, businesses, civil society and international organizations are expected to attend the Forum and exchange ideas on how to improve access to clean energy sources in East Africa. The event comes at a crucial moment when the international community is focused on improving progress on Sustainable Development Goal 7 and the goals set by the Paris Climate Agreement.

Off-grid renewables, clean cooking fuels, and energy financing and policies are among the many issues that will be discussed in the plenaries. The Forum will also feature sessions on sustainable cities, East Africa’s geothermal projects and future potential, and gender mainstreaming in energy access.

Speakers attending the Forum include: Rachel Kyte, CEO of Sustainable Energy for All; Ambassador Libérat Mfumukeko, Secretary General, East African Community (EAC); Tareq Emtairah, Director of Energy, United Nations Industrial Development Organization (UNIDO); Robert Zeiner, Director International Cooperation, Austrian Development Agency; Upendra Tripathi, Director General, International Solar Alliance (ISA); and Sakari Oksanen, Deputy Director General, International Renewable Energy Agency (IRENA); Monojeet Pal, Manager, African Development Bank (AfDB).

This year’s Forum will take place in Kigali, Rwanda. The city is a very special location since it hosted one of the most successful international treaties in human history, the Kigali Amendment to the Montreal Protocol.

The Sustainable Energy Forum for East Africa 2018 is organized by the East African Centre for Renewable Energy and Energy Efficiency (EACREEE) in collaboration with the United Nations Industrial Development Organization (UNIDO), the EAC Secretariat, the Austrian Development Agency (ADA), Sustainable Energy For All (SEforALL), and the Ministry of Infrastructure of the Republic of Rwanda (MININFRA), and is hosted by the government of Rwanda.

The organizers welcome participants from the public and private sectors, including sub-national entities, development finance institutions, domestic and international enterprises, international organizations, industry associations, and experts from academia.

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