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Washington’s Energy Conundrum in Syria

Antonia Dimou

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Geopolitics of energy dominates the crisis in Syria. Foreign powers continue to battle for control of natural gas resources and the trade routes that bring energy to consumers. The role of energy in expanding the conflict in Syria is crucial but important element is the fact that the Syrian army and the US-backed Syrian Democratic Forces (SDF) have made major gains against ISIS’s hold over lucrative oil wells.

The US leverage over Syria’s oil and gas fields such as the al-Omar and Tanak oil fields through the American supported SDF is a reported reality. Notably, al-Omar is Syria’s largest oil field that produced approximately 30 thousand barrels per day before 2011 when the Syrian crisis erupted, while the Tanak field maintains 150 wells with capacity to produce around40 thousand barrels per day. This leverage can be used either as a bargaining chip in forthcoming negotiations with the Assad regime for the political future of Syria, or for finding new markets for the Arab country’s energy. The latter can be achieved by supporting the construction of a pipeline that would transfer Syrian energy to either Turkey or Iraq.

Syrian oil controlled by the SDF could be transferred to the Kurdistan Regional Government (KRG) whose existing oil pipeline infrastructure will funnel Syrian energy to the European market. The benefits of this export option will be multifold for American policies in the region as the KRG will gain revenues in the form of royalties that could ease the budget crisis attributed to low oil prices and also fund the fight against the Islamic State (IS).

The US influence is also strengthened by the SDF’s control of the two largest dams in Syria; the Tabqa dam a 824-MW powerhouse that is a key source for water, agriculture and electricity at Euphrates 25km west of Raqqah and, the Soviet-built dam in western Raqqah. The control towers and stations of both dams have been destroyed, and as consequence, heavy investment is needed for the development and redesigning of these facilities. This presents a golden opportunity for the US not only to implement its advanced technology in the two dams but also to solidify control over vital reservoirs that will grant Washington a major foothold in Syria.

It has to be noted that the combined capacity of Syria’s two refineries at Banias and Homs is very low due to their significant damage once under the control of IS. Thus a major investment is required taking into account that neighboring export destinations like Turkey and Iraq lack of refineries that can treat Syrian crude oil with more than 0.5% sulfur. Reportedly, the only European country that can receive Syrian crude oil is Germany whose Beta facility is designed to accommodate high-sulfur and high-acid crudes.

Syria is also a promising zone of natural gas reserves in the territorial waters off its Mediterranean coast where Russia seeks to maintain investment in the energy sector. This is evidenced by the fact that energy giant Gazprom has reportedly taken over the gas exploration and drilling rights off the Syrian coast from Russian state-controlled Soyuzneftegaz, which in 2014 signed a 25-year agreement with the Syrian government that concedes exclusive exploration rights in Syria’s Exclusive Economic Zone. Notably, Syria’s offshore blocks 1 and 3 lie in an area contested by Lebanon and therefore a possible dispute between the two countries may impede Damascus from exploring its offshore oil and gas potential.

No doubt that the US presence in Syria can be solidified through control and investment over Syria’s oil and gas fields. For example, American investment to restore the Conoco gas plant in eastern Syria currently under the control of the US-supported SDF can prove to be significant as it can produce almost 50 million cubic feet of gas per day. Also critical is the likelihood of American investment in the two cited largest dams that will provide Washington not only control over vital reservoirs but most important bargaining power in future negotiations with the Assad regime. Concurrently, the US can use Syria’s reconstruction as an opportunity to push for stronger governance and transparency in the Syrian energy sector.

The resolution of the Syrian conflict as a prerequisite for the development of the country’s untapped offshore gas resources and for attracting foreign investment in the context of regional energy cooperation is realistically important. Because this way, the monopolization of the Syrian regime by third countries that aim to control the shores of the Mediterranean, and thereby to establish export plants and control natural gas exported to third markets will be avoided.

Unquestionably, conflict resolution is the only way for the development of Syria’s energy potential and for moving towards regional stability. Upon this context, challenges and opportunities facing American diplomacy lie ahead.

Antonia Dimou is Head of the Middle East Unit at the Institute for Security and Defense Analyses, Greece; and, an Associate at the Center for Middle East Development, University of California, Los Angeles

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France Shows How Energy and Society Are Intertwined

Todd Royal

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What should be asked about energy is what Plato’s The Republic through Socrates asked: “What is justice?” If energy has a moral, economic, environmental, and life-saving component then energy in all forms is certainly just.

This is where facts need to be realized, and find out if a carbon-free society run on renewable energy is even remotely possible? Over 6,000 everyday, products come from a barrel of crude oil.

The International Energy Agency (IEA) released The World Energy Outlook 2018 – the self-proclaimed “gold standard of energy analysis,’ – admitting a damning conclusion. That amidst the overwhelming amount of graphs, charts, tables and prognostications, “the percentage of total global primary energy demand provided by wind and solar is 1.1%.”

The world runs off fossil fuels, and no time in the coming decades will clean energy, a carbon-free society, or zero emission energy to electricity or electric vehicles sustain trillion-dollar economies. More alarming is the world’s largest authoritarian, communist government, China, controls 90 percent of the world’s rare earth minerals – “a group of 17 elements with similar qualities that are used in electric car batteries, wind turbines and solar panels.”  

 Nations, companies, and individuals care about national security, their own “self-interest rightly understood” while meeting the basics of food, clothing and shelter (Maslow’s Hierarch of Needs) – exactly what fossil fuels provide – on an affordable, scalable, reliable and flexible basis for energy to be delivered to billions of people starving for their modern way of life to continue.

We are witnessing an energy clash globally, and nowhere was that better defined than France’s “Yellow Vest” protests that began in late November 2018 and are ongoing. These protests brought a convergence of domestic concerns triggered over a proposed fuel tax hike that hit lower educated, ordinary voters more than educated urban dwellers.

France’s, politicized carbon tax – the theory goes – should be an efficient way to disseminate the monetary consequences of carbon onto the French and global economies; however, that isn’t necessarily the case. This regulatory heavy-handedness by the state has resulted in:

Decades of global conferences, forest of reports, dire television documentaries, celebrity appeals, school-curriculum overhauls and media bludgeoning,” without examining the facts.

France is a good test case for energy policy moving forward, because if humanity overwhelmingly using fossil fuels are killing plants, animals, the ecosphere and crushing human life than a tax is fair, just and equitable, correct? But that isn’t the case. The earth and human progress have never done better in recorded history. Economic growth and technology are saving us from such historic plagues like poverty, illness and deforestation.

President Emmanuel Macron and the previous administration of Francois Hollande wrongly targeted emissions unlike Germany that is a high-emitter off increased coal-fired power plant use backing up renewables. Macron’s carbon tax went after Yellow Vest protesters who are vehicle reliant. Since France heavily relies on clean, carbon-free nuclear power for their electricity, France is only“0.4% of global emissions.”

Macron is punishing French drivers via punitive tax hikes and it failed. Voters and everyday working citizens aren’t buying carbon taxes or anything that restricts energy and prosperity. Green piety in Washington State in the US was also rejected the same way it was in France.

Cutting transportation emissions are extremely hard to eliminate when the entire supply and value chain of the tailpipe’s emissions are factored into the equation. It’s why electric vehicles (EVs) aren’t as environmentally friendly as advertised.

Carbon taxation like renewables and carbon-free societies have become buzzwords that reveals the disconnect over the properties that constitute a modern society and an “aloof political class that never reasons with their concern over emissions.”

Achieving energy parity at low costs will never be accomplished by imposing solutions that consist of using expensive, unreliable, intermittent renewable energy. Then believing these policy solutions will have zero impact on economic growth and overall wellness. The impact is heavier use of coal.

The European Union (EU) has: “Eleven countries still planning to use coal-fired power in 2030 (in order of increasing installed capacity) are: Spain, Hungary, Croatia, Slovakia, Greece, Romania, Bulgaria, Czech Republic, Germany and Poland.”

All EU countries have been given energy transition funds to exit coal by 2030, but only France is able to withstand the use of coal through heavier use of nuclear. Geopolitical reasons are another reason you will find a transition to the clean energy economy in the coming decades, because of US shale oil and natural gas production – fracking is changing the world.

In general, US shale exploration and production (E&P) is booming like never before. As of December 2018 the United States briefly became a net exporter of crude oil and refined products; and unless voters ban fossil fuel production the US will become energy independent.

The US Department of Interior’s, United States Geological Survey announced in December 2018: “The largest estimate of technically, recoverable continuous oil that USGS has ever assessed in the United States. The Wolfcamp shale in the Midland Basin portion of Texas’ Permian Basin province contains an estimated mean of 20 billion barrels of oil.”

Whereas California doesn’t exploit their Monterrey Shale resources – considered one of the largest shale deposits in the US and possibly the world – since California policymakers are only pursuing clean energy resources. Why does fossil fuel and renewable energy have to be politicized when they could work together? Texas and California should be pioneering world-class energy research together. Fossil fuel could pay for research and development to build better renewable energy, globally scalable storage systems and an electrical grid that is smart, reliable and have a 50-100 year shelf life.

An honest broker of information takes energy choices and consequences of say increasing fossil fuel use by burning copious amounts of coal that China, India, Poland, Australia and the United States are doing versus emission-heavy air that cause all sorts of lung and respiratory illnesses.

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Energy and Geopolitics is Under Attack

Todd Royal

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Global warming. Climate change. Renewable energy. Carbon-free societies. All of these terms have gained status, as the balm to eliminate fossil fuels, which is supposedly causing anthropogenic, global warming. What should be noted however, is according to the National Oceanic and Atmospheric Administration (NOAA), and the United States National Climatic Data Center (NCDC):

1. The PRIMARY force is that the SUN heats the earth’s oceans and land,

2. Then, SECONDARILY, the earth’s oceans and land heats the atmosphere. The atmosphere is NOT heating the earth it’s the sun.

3. Consequently, after the above two, increasing air temperature then increases sea surface temperature.

Facts tell us the one constant on earth is that the climate is always changing. Facts also tell us that CO2 is statistically irrelevant, as a factor in determining the earth’s climate. Therefore, CO2 is a minor factor in weather determination.

Whether or not there is, or isn’t climate change, global warming, and who is, or isn’t to blame, here is why that sentiment is dangerous from noted climatologist, and true scientific consensus believer, Dr. Judith Curry:

“Climatology has become a political party with totalitarian tendencies. If you don’t support the UN consensus on human-caused global warming, if you express the slightest skepticism, you are a ‘climate-change denier,’ who must be banned from the scientific community.”

What’s alarming about Curry’s statements is the UN was created to keep another world war from breaking out while promoting integrated commerce, and human interaction instead of another global holocaust. Why the UN has gotten into climate research, and environmental, weather-interactions are grossly past its intended mandate.

Scientific research according to Karl Popper “should be based on skepticism, on the constant reconsideration of accepted ideas.”

When it comes to energy and climate we should be considering what promotes human longevity and flourishing. What makes energy and electricity affordable, scalable, abundant, reliable, and flexible? Now the global warming, climate change debate is only about made-for-profit power.

Renewables are sure-fire, taxpayer-funded, profit centers when:

“In 2016, renewables received 94 times more in U.S. federal subsidies than nuclear and 46 times more than fossil fuels per unit of energy generated.”

Weather and climate are under attack, but so is the science of energy, from believing a “Green New Deal” will work for labor to thinking all energy issues are solved from electricity. Electricity is a static proposition that needs to be generated from some source; whether oil, coal, natural gas, nuclear, solar panels, wind turbines or damned water through turbines to produce energy to electricity.

But nothing energizes environmentalists and citizens like renewable energy. Every single place renewables have been implemented they are a disaster.

In Germany, Denmark, Spain, Britain, South Australia, Vermont, Minnesota, New Mexico (in the beginning stages of maligning fossil fuels), Arkansas, California, Austin, Texas, and Georgetown, Texas, solar and wind farms have been valiantly attempted, and failed every single time. Renewables will never work under current technological and scientific constraints; and energy battery storage systems only have 8-12 maximum capacity according to Massachusetts Institute of Technology (MIT).

The science behind renewable energy also makes electricity more expensive. For example:

“Solar panels with storage deliver just 1.6 times as much energy as is invested as compared to the 75 times more energy delivered with nuclear.”

There is no battery revolution for energy storage systems, and renewables under current technological constraints. Economics factually show that renewables will always constrain electricity, causing price hikes and degrading infrastructure improvements. Only fossil fuels at this time have the science, engineering, technology, and economics that make sense for human flourishing and longevity.

Over six thousand products come from a barrel of crude oil. Meaning, the conversation should stop about de-carbonizing, searching for clean energy, and eliminating oil from our daily lives. There is positive correlation even causation between energy and environmentalism. Clean environments only happen, “as people consume higher levels of energy the overall environmental impact is overwhelmingly positive, not negative.”

Fossil fuels have been used safely for centuries, and billions have left poverty. Oil, natural gas, and coal reduce the amount of land needed for energy, compared to solar and wind farms. If the earth is warming:

“Then aerial fertilization by CO2 has increased food supplies by 25%, weather is less extreme in a warming world, and historically conflicts increase during periods of cooling, and decrease during warmer periods.”

Our growing understanding of energy, science, engineering, and markets yields important geopolitical lessons. The science, and use of natural gas, makes its conversion to liquid natural gas (LNG) more important to energy, geopolitics and diplomacy than anything outside of strong militaries. Natural gas is the soft power, weapon-of-choice for nation states like Russia.

Natural gas spending will jump five-fold in 2019, according to Wood Mackenzie. The International Energy Agency (IEA) says:“Natural gas demand to rise 10 percent over the next 5 years, and roughly 40 percent of that will come from China.”

The Trump administration is pushing for Eastern Mediterranean natural gas, and “sees the promotion of natural gas production and related infrastructure in the region as a key effort in tying countries together and promoting peace.” This continues “an Obama-era foreign policy objective.”

French, energy firm, Total, is partnering with Russia on a LNG project in the Arctic to protect French energy needs. Even smaller, geopolitical players like Mexico, are seeking ways to boost natural gas production 50 percent through government-owned, Petroleo Mexicanos (PEMEX).

Fossil fuels – particularly natural gas – will be the leader for decades ahead when it comes to soft power, national security and robust economic growth for mature and emerging markets. Political moves, similar to Michael Bloomberg donating $500 million to kill coal use in the US, could slow natural gas’ growth, but if they do, they will also devastate the country and its western allies geopolitically. China, Russia, India, Africa, Iran, and North Korea will never let a billionaire stop their economies or geopolitical power. Yes, energy and geopolitics is under attack from within, from national and from competing energy interests.

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Investors with US$2 billion urge donors to ramp up support for mini-grids in Africa

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An influential group of impact and energy investors has called on major donors to increase their support for energy access solutions in Africa, especially rural utilities called mini-grids, and cautioned that private capital would stay on the sidelines without well-designed, coordinated financing.

Specifically, the 12 investors, which have more than US$2 billion under management, said that the missing catalyst for scaling mini-grids was an effective results-based financing (RBF) mechanism.

The International Energy Agency (IEA) says that with proper finance and policy that renewable energy mini-grids can provide electricity to 450 million people, mostly in Sub-Saharan Africa, by 2030. It’s estimated that US$10-25 billion annually is needed to fund the up to 200,000 mini-grids required, yet of the US$1.7 billion investment in off-grid renewable energy from 2010-2018, less than 15% went to mini-grids, creating a huge financing gap.

In a position paper signed by the investors, Unlocking Private Capital for Mini-Grids in Africa, they said that RBF is key to bridging the gap, as it would unlock private capital. RBF is a per connection subsidy similar to what state-owned utilities receive from governments.

The investors said that they had the means to provide the matching private capital that donor-backed mini-grid subsidy programs needed in Africa.

“We believe mini-grids have a role to play in achieving universal electrification, and we have the types of capital needed for mini-grid financing alongside well-designed RBFs,” the investors said in a public position paper. “We stand ready to work with donors and governments to help design effective RBF programs that will unlock our capital.”

“We therefore strongly encourage donors and governments to support effective RBF programs that subsidize rural connections,” they said.

The group of investors is expected to grow. Current signatories include Acumen, Blue Haven Initiative, Ceniarth, CrossBoundary Energy Access, DOB Equity, ENGIE Powercorner, Hoegh Capital Partners, KawiSafi Ventures, Renewable Energy Performance Platform (REPP), responsAbility, SunFunder and Triodos Investment Management.

Some European donors have experimented with mini-grid RBF, including DFID and SIDA, but no systematic, coordinated mechanism exists. The mini-grid trade body, the Africa Mini-Grid Developers Association (AMDA), has outlined guidelines for an effective RBF, saying it needs to be simple, measurable, Africa-wide, repeatable and timely.

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