Mexican power outages enter fourth day
Mexican power grid operator Cenace issued its fourth consecutive day of operating alerts amid the heatwave gripping the country.
Net electricity demand reached 47,321MW early today, with deployed electricity capacity slightly below at 47,233 MW, according to Cenace.
Since 7 May, Cenace has declared emergency operating alerts as demand exceeded generation capacity during peak evening hours, prompting the grid operator to preemptively cut electricity supply across different states to maintain grid integrity.
Power outages have lasted up to several hours in Mexico City and in major industrial states as power demand has outstripped supply by up to 1,000MW. Peak demand this week hit 49,000MW, just below last year's historic peak of 53,000MW during atypical temperatures in June.
"We are very concerned about the unprecedented outages detected across 21 states, a situation that affects the normal functioning of Mexican companies," national business chamber Coparmex said.
Peak electricity demand typically rises in June-July but temperatures this week have risen as high as 48°C (118° F) across some states. Mexico City reported a record high of 34.3°C on 9 May and high temperatures are forecast to continue into next week, Mexico's national weather service said.
The inability of Mexico's grid to respond to increased demand is because of insufficient power generation capacity, non-profit think-tank the Mexican institute for competitiveness (Imco) said this week.
"Despite the energy ministry's forecast that 22,000MW of new power capacity would enter service by 2026, only 1,483MW had entered service as of 2022" since late 2018, Imco said.
President Andres Manuel Lopez Obrador's administration pledged to build new generation capacity, including five gas-fired, combined-cycle plants, but recognized this week that delays had contributed to the power outages.
"We have an electricity generation deficit because some of the combined-cycle plants were delayed, but we are working on it and it will soon be resolved," Lopez Obrador said on 9 May.
Lopez Obrador's government has also curtailed private sector power development during his administration.
Mexico needs to upgrade and expand its transmission network, industry associations say.
"In order to resolve this problem, we believe that a reopening of the electricity market to the private sector is imperative," Mexico's wind energy association, Amdee, said.
Mexico has 87,130MW of installed capacity, with 39.5pc from combined-cycle gas-fired power plants and 31pc in renewable power, including wind, solar, hydroelectric, geothermal and biomass, according to the latest statistics from the energy ministry.
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Indonesia’s Merdeka posts lower nickel output in 1Q
Indonesia’s Merdeka posts lower nickel output in 1Q
Singapore, 5 June (Argus) — Indonesian nickel firm Merdeka Battery Materials' (MBMA) production decreased during January-March from the previous quarter, weighed down by wet weather issues and a lack of equipment availability. MBMA produced 2.1mn wet metric tonnes (wmt) of material at its Sulawesi Cahaya Mineral (SCM) mine during the quarter, down by 36pc from the previous quarter's 3.3mn wmt. Output was weighed down by higher-than-average rainfall and lower-than-planned contractor equipment availability. Limonite ore supplies fell by 25pc from October-December to 1.2mn wmt, while the volume of saprolite ore more than halved to 0.5mn wmt over the same period. The firm did not provide its production figures for the year-earlier period. The production guidance for limonite and saprolite ore for 2024 has been kept largely steady at 10mn-11mn wmt and 4mn-5mn wmt, respectively. But production volumes are anticipated to increase in 2025, with PT ESG New Energy Material's (PT ESG) feed preparation plant commissioning by mid-2025. Limonite ore sales to PT ESG is expected to be about 5mn wmt/yr. The SCM mine supplies limonite ores to the Huayue Nickel Cobalt high-pressure acid leaching (HPAL) plants and saprolite ore to MBMA's rotary kiln electric furnaces (RKEF) smelters. The RKEF smelters produced 20,900t of nickel in nickel pig iron (NPI) during January-March, falling by 5.6pc from the previous quarter's 22,141t. Matte output was at 12,041t of nickel, a 5.1pc drop from 12,684t in the previous quarter. The company maintained the 2024 production guidance for its nickel intermediates at 85,000-92,000t of nickel in NPI and 50,000-55,000t of nickel in matte. Developments at MBMA's projects remained on track during the quarter. Widening works on the main haul road connecting the SCM mine to Indonesia's Morowali Industrial Park, and the construction of a more direct haul road to replace the use of a third party's road are underway. A collaboration with Chinese cathode precursor and nickel producer Green Eco-Manufacture to develop PT ESG's HPAL plant, with a nameplate capacity of 30,000 t/yr of nickel in mixed hydroxide precipitate (MHP), is projected to be commissioned in late 2024. MBMA has another HPAL plant partnership with Brunp, a subsidiary of China's largest power battery manufacturer Contemporary Amperex Technology, with a nameplate capacity of 60,000 t/yr of nickel in MHP. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Malaysia’s Petronas lifts gas, lowers oil output in 1Q
Malaysia’s Petronas lifts gas, lowers oil output in 1Q
Singapore, 5 June (Argus) — Malaysia's state-owned Petronas reported higher gas production in this year's first quarter but slightly lower crude output. The firm also posted marginally higher revenue for the period but weaker profit. Petronas' gas production during January-March rose by 6.5pc to 1.74mn b/d of oil equivalent (boe/d). But oil production fell marginally by 2pc from the same period last year to 840,000 boe/d. The firm's output during the quarter was attributed to "stellar performances from Peninsular Malaysia, Sarawak and Sabah assets", it said. It also produced 2.68mn t of petrochemicals during the quarter, largely stable from a year earlier. The firm has been pressing ahead with its exploration efforts, offering five exploration blocks and five discovered resource opportunity clusters under the Malaysia Bid Round 2024. It was also awarded the Bobara working area last month under Indonesia's third petroleum bid round. Its gross LNG sales and crude sales both rose by 11pc from a year earlier to 9.9mn t and 29.1mn bl respectively. But its oil product sales and petrochemical products sales dropped by 8pc and 4pc to 71mn bl and 2.3mn t respectively. Petronas recorded revenue of 89.7bn ringgit ($19bn) for January-March, largely stable from the same period a year earlier despite prolonged price volatility, it said. But profit fell by 11pc to 21.3bn ringgit. Profitability was affected by lower realised gas prices, in line with market volatility, said the firm. It also attributed the lower profit to a rise in upstream operating expenditures and higher cash payments. The firm paid a 3bn ringgit dividend to the government for the quarter. The firm's capital expenditure (capex) during January-March rose by 2pc to 10.7bn ringgit. Out of this, the biggest share, or 64pc, went towards upstream investments, especially in Argentina, Brazil and Iraq, while 17pc went to gas investments. Petronas also spent 10pc of its capex on cleaner energy solutions and decarbonisation projects. It reported a 2.6pc drop in scope 1 and 2 greenhouse gas emissions to 11.3mn t of carbon dioxide equivalent during the quarter. The firm in February signed a storage site agreement for the M3 depleted field offshore Sarawak, with Japanese firms Japex, JGC and KLine. It also signed a joint study agreement in March with Japan's Jera to evaluate the feasibility of developing a carbon capture and storage value chain . By Prethika Nair Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
China's NEV penetration to hit 40pc in 2024: CAAM
China's NEV penetration to hit 40pc in 2024: CAAM
Beijing, 5 June (Argus) — China's new energy vehicle (NEVs) penetration will likely rise to 40pc by the end of 2024, according to the China Association of Automobile Manufacturers (CAAM). The number of users that intend to buy an NEV is already on par with those that want to purchase internal combustion engine (ICE) vehicles, CAAM said. Nearly 30pc of users, surveyed by CAAM and domestic automotive information service DCar, intend to trade in their old vehicles for a NEV in a year. And over 60pc of car users deem it "very necessary" to trade in their old vehicles for NEVs, CAAM added. China's NEV penetration has been increasing in the past few years, driven by the country's decarbonisation plans and supportive policies to accelerate EV development. These measures, such as boosting EV production and spurring battery technological innovations, are regarded as China's efforts to catch up with foreign competitors in the global automotive industry given its slowing development in ICE vehicles, according to industry participants. China's NEV penetration reached 26pc of the country's total automotive sales in 2022, rising to 31.6pc in 2023, 32.8pc in March, 36pc in April and 32.4pc over January-April. It aims to raise the share of NEV in its total vehicle sales to 45pc by 2027, according to a plan issued by the government earlier this year. But the industry is facing a slowdown in sales growth because of some challenges. CAAM estimates the country's NEV sales will rise to 11.5mn units in 2024, up by 21pc from 9.495mn in 2023. This growth is slower than the 38pc rise from 2022 to 2023. One of the main reasons why many potential buyers have not opted to buy an NEV is because of its shorter driving range compared with gasoline cars. CAAM expects that more than 40pc of potential NEV buyers prefer to buy a hybrid car, compared with 31pc for battery EVs. Over 60pc of potential battery EV buyers want a car with more than 500km of driving range, including 20pc of buyers requiring 700-1,000km. CAAM's report also shows that most consumers can afford and favour NEVs priced in the 100,000-200,000 yuan ($13,801-27,603) range. How to provide competitively-priced vehicles is a subject that requires long-term research from EV manufacturers, CAAM said. China has introduced a series of new supportive measures recently to drive its NEV sales growth, including a plan to remove purchase restrictions during 2024-25. But some industry participants are not sure that this plan is applicable in major cities particularly Beijing, which has severe traffic congestion. Beijing has the largest number of motor vehicles in China, with a vehicle population of nearly 7.6mn units as of the end of 2023. China's BEV and PHEV sales during 2022-24 Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Q&A: LNG, renewables key for Australian gas: Jemena
Q&A: LNG, renewables key for Australian gas: Jemena
Sydney, 5 June (Argus) — Australian gas pipeline and power distribution firm Jemena has been at the forefront of the country's biogas sector through its Malabar facility in Sydney, while continuing to supply natural gas and eyeing hydrogen blending. Argus spoke to managing director David Gillespie on the sidelines of the Financial Review ESG Summit in Sydney about the company's future and how he views Canberra's future gas strategy. Edited highlights follow: Your thoughts on the future gas strategy, which was released with quite a bit of fanfare. What's the substance behind it? It's a piece of work that to me is very science backed. And ultimately the whole system needs to transition. It can't just be a view of one technology doing the heavy lifting. I think it's a strong acknowledgement of the role of gas that's going to be here, for not just firming of renewable energy in the future, but also those hard to abate industrial sectors. Ultimately over the long run I think gas itself is a fuel that's going to have a decarbonisation journey of its own. So it really promotes a conversation around getting down the path of a whole of system reduction of the energy sector's carbon footprint. Regarding biogas, are you seeing any kind of levers in the works to encourage production? Definitely there are green shoots. We've had the Malabar facility certified from a green power perspective and that's a great step. We're having really good engagement with government around inclusion of any purchases of that biomethane in the national greenhouse gas reporting, so if you buy certified biomethane you'll get the benefit for that in terms of emissions intensity of your business. We hope that's achieved within the next 12 months. Ultimately a strong market signal to drive investment will be a renewable gas target that will see us with very clear investment signals around the role that will play in terms of its future mix and scale, first and foremost for the industrial load that is hard to abate. Do you have an idea about what that target might look like and what sort of percentage? I don't. What I would say is if you take just the Sydney basin, two-thirds of the gas that's flowing through it is for industrial use, roughly 60 PJ/yr (1.6bn m³/yr) of gas. If you can decarbonise half of that through economically rational projects, proximate to the network, then you're on a pathway to making big inroads in the country's most populous state. We're looking at projects that are more scaled than the [2.5mn m³/yr] Malabar facility, more in the 1-2PJ range. So if you can encourage renewable gas further with targets, I think you'll really start to see some momentum. Where's the 200 TJ/d (5.34mn m³/d) Eastern Gas Pipeline (EGP) reversal project at? The [12km] pipeline to connect the [2.4mn t/yr] Port Kembla LNG terminal to the EGP was completed in December and the terminal construction will be complete by the first quarter of 2025, ahead of commercial operations from winter 2026. So the reversal activities we are completing will be lined up to be delivered by 1Q 2026. I don't think there's any new gas supply outside of LNG terminals that has a clear pathway to market in terms of approvals and timeframes. We're absolutely supportive of encouraging new supply but ultimately the most near-term solution is LNG terminals. Port Kembla's injection capacity is just over 500 TJ/d, about 40pc of the Victorian load today. So you're still going to, I think, need more supply over the long run as well. But this is going to be the first realistic option in the market. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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