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Renewable additions to accelerate in Colombia

  • Spanish Market: Electricity
  • 19/01/24

Non-conventional renewable energy (NCRE) capacity additions in Colombia could accelerate sharply this year as over 1GW of projects are set to come online, after regulatory and social challenges hindered the sector last year.

Colombia added 224MW of new NCRE capacity in 2023, lifting NCRE capacity to 467MW. Additions in 2022 were 243MW.

But the country will reach the 1GW mark by May 2024, according to renewable association SER's director Alexandra Hernandez, a goal that the government had expected to reach by the end of 2023. Long permitting processes, higher taxes for the sale of renewable electricity and community backlash hit a previously projected faster growth in renewables.

More than 1,100MW of solar and almost 32MW of wind projects are currently in the testing phase. If all projects come into operation as scheduled, the country would have 1.55GW of renewable capacity by end of year.

Of the 1,100MW solar plants, five have capacity ranging from 100MW-370MW, another five from 20MW-80MW, and the rest are smaller plants. The solar projects fed over 4,000MWh/day of electricity to the grid in the first week of January, data from grid operator XM show.

Government policies to speed tracking progressseems to be working, Adrian Correa, director of the government's mining and planning unit Upme told Argus. Correa believes the government's target of 6GW of NCRE capacity by August 2026 is likely to be reached given the implementation of periodic monitoring of generation projects. This has helped identify and manage solutions to the environmental, social and permitting problems.

But renewable projects still face hurdles as some communities demand formal consultation processes, even though they do not live in the areas where projects are planned.

Regulation should also be reviewed because the norms say that larger renewable plants must tell XM the prior day how much electricity they will sell to the market. If they fail to deliver the amount committed, XM levies a fine, Alejandro Piñeros, director of regulation at the consulting firm Optima says.

Enel's projects dominate

Among the projects planned to be operational this year are Italian Enel Green Power's 132.2MW Fundacion and 187MW La Loma solar farms.

Both projects are 95pc advanced and should start delivering electricity on a commercial basis during the first half 2024.

Construction of the Guayepo I and II solar farms, with a combined capacity of 486.7MW is more than 60pc advanced. The plants began testing phases on 26 December and will begin commercial operation in the fourth quarter 2024, Enel said. The project costs $290mn and is in the Caribbean Atlantico province.

Guayepo will generate around 1,030 GWh/yr of electricity once completed — equivalent to generating electricity to supply 770,000 inhabitants. Colombia's largest beer company Bavaria will use electricity produced to supply Bavaria's seven breweries after signing a power and purchase agreement (PPA).

Other smaller projects with operations targeted for this year are French firm Green Yellow's solar farms with a combined capacity of 49.5MW.

Meanwhile, the Dinamarca and Versalles solar projects with 14MW of capacity each began commercial operations in the second week of January. The 14MW La Mena will begin commercial operations by the end of January, Green Yellow said.


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25/07/24

Refining, LNG segments take Total’s profit lower in 2Q

Refining, LNG segments take Total’s profit lower in 2Q

London, 25 July (Argus) — TotalEnergies said today that a worsening performance at its downstream Refining & Chemicals business and its Integrated LNG segment led to a 7pc year-on-year decline in profit in the second quarter. Profit of $3.79bn was down from $5.72bn for the January-March quarter and from $4.09bn in the second quarter of 2023. When adjusted for inventory effects and special items, profit was $4.67bn — slightly lower than analysts had been expecting and 6pc down on the immediately preceding quarter. The biggest hit to profits was at the Refining & Chemicals segment, which reported an adjusted operating profit of $639mn for the April-June period, a 36pc fall on the year. Earlier in July, TotalEnergies had flagged lower refining margins in Europe and the Middle East, with its European Refining Margin Marker down by 37pc to $44.9/t compared with the first quarter. This margin decline was partially compensated for by an increase in its refineries' utilisation rate: to 84pc in April-June from 79pc in the first quarter. The company's Integrated LNG business saw a 13pc year on year decline in its adjusted operating profit, to $1.15bn. TotalEnergies cited lower LNG prices and sales, and said its gas trading operation "did not fully benefit in markets characterised by lower volatility than during the first half of 2023." A bright spot was the Exploration & Production business, where adjusted operating profit rose by 14pc on the year to $2.67bn. This was mainly driven by higher oil prices, which were partially offset by lower gas realisations and production. The company's second-quarter production averaged 2.44mn b/d of oil equivalent (boe/d), down by 1pc from 2.46mn boe/d reported for the January-March period and from the 2.47mn boe/d average in the second quarter of 2023. TotalEnergies attributed the quarter-on-quarter decline to a greater level of planned maintenance, particularly in the North Sea. But it said its underlying production — excluding the Canadian oil sands assets it sold last year — was up by 3pc on the year. This was largely thanks to the start up and ramp up of projects including Mero 2 offshore Brazil, Block 10 in Oman, Tommeliten Alpha and Eldfisk North in Norway, Akpo West in Nigeria and Absheron in Azerbaijan. TotalEnergies said production also benefited from its entry into the producing fields Ratawi, in Iraq, and Dorado in the US. The company expects production in a 2.4mn-2.45mn boe/d range in the third quarter, when its Anchor project in the US Gulf of Mexico is expected to start up. The company increased profit at its Integrated Power segment, which contains its renewables and gas-fired power operations. Adjusted operating profit rose by 12pc year-on-year to $502mn and net power production rose by 10pc to 9.1TWh. TotalEnergies' cash flow from operations, excluding working capital, was $7.78bn in April-June — an 8pc fall from a year earlier. The company has maintained its second interim dividend for 2024 at €0.79/share and plans to buy back up to $2bn of its shares in the third quarter, in line with its repurchases in previous quarters. By Jon Mainwaring Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Australia’s Origin to expand Eraring battery project


25/07/24
25/07/24

Australia’s Origin to expand Eraring battery project

Sydney, 25 July (Argus) — Australian utility Origin will expand the battery energy storage system (BESS) at the site of its 2,880MW Eraring coal-fired power station in News South Wales (NSW), as part of its strategy to pivot to renewable energy. The A$450mn ($294mn) investment will add 240MW of four-hour duration supply to the 460MW, two-hour BESS already under construction as part of the project's first stage, Origin said on 25 July. Agreements for equipment supply and construction have been made with stage two construction to begin in early 2025 before the expansion comes on line during January-March 2027. Equipment will be provided by Finnish engineering firm Wartsila, which is also building the first stage of the BESS. The sanctioning of Eraring's second stage brings the firm's total commitment on storage to 1.5GW, with Origin agreeing in January to outlay A$400mn on a 300MW BESS along with the firm's 550MW Mortlake gas-fired power plant in Victoria. Origin and the NSW Labor state government agreed in May to keep Eraring, Australia's largest single power plant, open for at least two more years as part of a deal to maintain capacity because of delays with replacement projects. Australia is struggling to replace its retiring coal-fired power generation because of cost blowouts and delays for renewable projects. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Repsol 2Q profit doubles but cash flow turns negative


24/07/24
24/07/24

Repsol 2Q profit doubles but cash flow turns negative

Madrid, 24 July (Argus) — Spanish integrated Repsol's profit more than doubled on the year in the second quarter, as lower one-time losses and better results in the upstream and customer divisions more than offset a weaker refining performance. But its cash flow turned negative as it completed the buyout of its UK joint venture with China's state-controlled Sinopec, raised investments and experienced weaker refining margins. Net debt was sharply higher, largely reflecting share buy-backs. Repsol has said it will acquire and cancel a further 20mn of its own shares before the end of the year, which will probably further increase its debt. It completed a 40mn buy-back in the first half of the year. Repsol's profit climbed to €657mn ($714mn) in April-June from €308mn a year earlier, when earnings were hit by a large provision against an arbitration ruling that obliged it to acquire Sinopec's stake in their UK joint venture. Excluding this and other special items, such as a near threefold reduction in the negative inventory effect to €85mn, Repsol's adjusted profit increased by 4pc on the year to €859mn. Repsol confirmed the fall in refining margins and upstream production reported earlier in July . Liquids output increased by 3pc on the year to 214,000 b/d, and gas production fell by 4pc to 2.1bn ft³/d. Adjusted upstream profit increased by 4pc on the year to €427mn. The higher crude production and a 13pc rise in realised prices to $78.6/bl more than offset lower gas production and prices, which fell by 6pc to $3.1/'000 ft³ over the same period. Adjusted profit at Repsol's industrial division — which includes 1mn b/d of Spanish and Peruvian refining capacity, an olefins-focused petrochemicals division, and a gas and oil product trading business — was down by 16pc on the year at €288mn. Profit fell at the 117,000 b/d Pampilla refinery in Peru after a turnaround and weak refining margins, and there was lower income from gas trading. Spanish refining profit rose on a higher utilisation rate and gains in oil product trading. Repsol's customer-focused division reported adjusted profit of €158mn in April-June, 7pc higher on the year thanks to higher retail electricity margins, a jump in sales from an expanded customer base, higher margins in aviation fuels and higher sales volumes in lubricants. Repsol swung to a negative free cash flow, before shareholder remuneration and buy-backs, of €574mn in the second quarter, from a positive €392mn a year earlier. After shareholder remuneration, including the share buy-backs and dividends, Repsol had a negative cash position of €1.12bn compared with a positive €133mn a year earlier. Repsol's net debt more than doubled to €4.595bn at the end of June from €2.096bn on 31 December 2023, reflecting the share buy-backs and new leases of equipment. By Jonathan Gleave Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Equinor 2Q profit supported by higher European output


24/07/24
24/07/24

Equinor 2Q profit supported by higher European output

London, 24 July (Argus) — Norway's state-controlled Equinor posted a small rise in profit on the year in the April-June period, as a lift in its European production offset lower gas prices. Equinor reported a profit of $1.87bn in the second quarter, up by 2.2pc on the year but down by 30pc from the first three months of 2024. The company paid two Norwegian corporation tax instalments, totalling $6.98bn, in the second quarter, compared with one in the first quarter. Equinor paid $7.85bn in tax in April-June in total. Its average liquids price in the second quarter was $77.6/bl, up by 10pc from the second quarter of 2023. But average gas prices for Equinor's Norwegian and US production fell in the same period by 17pc and 6pc, respectively. The company noted "strong operational performance and lower impact from turnarounds" on the Norwegian offshore, including new output from the Breidablikk field . Equinor's entitlement production was 1.92mn b/d of oil equivalent (boe/d) in April-June, up by 3pc on the year. The company cited "high production" from Norway's Troll and Oseberg fields in the second quarter, as well as new output from the UK's Buzzard field. But US output slid, owing to offshore turnarounds and "planned curtailments onshore to capture higher value when demand is higher", the company said. It estimates oil and gas production across 2024 will be "stable" compared with last year, while its renewable power generation is expected to increase by around 70pc across the same timespan. Equinor's share of power generation rose by 14pc on the year to 1.1TWh in April-June. Of this, 655GWh was renewables — almost doubling on the year — driven by new onshore wind capacity in Brazil and Poland. "Construction is progressing" on the UK's 1.2GW Dogger Bank A offshore windfarm , Equinor said. It is aiming for full commercial operations in the first half of 2025 at Dogger Bank A — a joint venture with UK utility SSE. Equinor was granted three new licences in June to develop CO2 storage in Norway and Denmark. The Norwegian licences — Albondigas and Kinno — together have CO2 storage potential of 10mn t/yr. The Danish onshore licence, for which Equinor was awarded a 60pc stake, has potential capacity of 12mn t/yr. Equinor has a goal of 30mn-50mn t/yr of CO2 transport and storage capacity by 2035. The company's scope 1 and 2 greenhouse gas (GHG) emissions amounted to 5.6mn t/CO2 equivalent (CO2e) in the first half of the year, edging lower from 5.8mn t/CO2e in January-June 2023. It also incrementally cut its upstream CO2 intensity, from 6.7 kg/boe across 2023, to 6.3 kg/boe in the first half of this year. Equinor has kept its ordinary cash dividend steady , at $0.35/share, and will continue the extraordinary cash dividend of $0.35/share for the second quarter. It will launch a third $1.6bn tranche of its share buyback programme on 25 July. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Idemitsu to start black pellet output in December


23/07/24
23/07/24

Idemitsu to start black pellet output in December

Tokyo, 23 July (Argus) — Japanese energy firm Idemitsu is planning to start black pellet production of 120,000 t/yr in Vietnam in December this year. Idemitsu has already completed construction of the black pellet plant in Vietnam's Binh Dinh province in July 2023 and is now carrying out test operations. The black pellets produced at this plant will be transported to Japan for consumers that include power generation companies operating coal and biomass co-firing. The Vietnamese plant is managed by Idemitsu Green Energy Vietnam, which has become a 100pc subsidiary of Idemitsu in March this year. Idemitsu is planning to increase its black pellet output to 300,000 t/yr within three years after the start-up of the first plant. It final target is 3mn t/yr by 2030 , with an aim to launch projects in Malaysia and Indonesia in addition to Vietnam. The company is also considering empty fruit bunches as feedstock for biomass fuels. Idemitsu has been carrying out studies of coal and biomass co-firing and confirmed that it is possible to burn 35pc of black pellets with coal. The company has provided utilities with samples for test runs. Black pellets also can be used in other sectors, such as steel mills and cement plants. Black pellets, which have a higher calorific value compared with typical white pellet biomass, are produced by the torrefaction of acacia and other feedstock. The advanced fuel has better water resistance and grindability than white pellets and can be used in a similar way as coal. By Takeshi Maeda Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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