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Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced, redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained in this publication. However, no warranty is given to the accuracy of its content . Page 1 NewBase 08 December 2014 - Issue No. 492 Khaled Al Awadi NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE Oman: Musandam Power, Wärtsilä ink pact for power plant BYTIMES NEWS SERVICE + NEWBASE Oman Oil Company's (OOC) majority-owned subsidiary Musandam Power Company (MPC) signed the engineering, procurement and construction (EPC) contract and Long Term Service Agreement (LTSA) with Wärtsilä Muscat to build a new dual fuel-fired power plant at Tibat wilayat Bukha in Musandam Governorate. Under the agreement, Wärtsilä, a global leader in complete lifecycle power solutions, will design, procure and manage the construction of the 120MW gas-fired power plant, as well as provide on- going maintenance and performance monitoring during the concession period of 15 years from the commissioning date The EPC and LTSA agreements were formalised at OOC's head office by Eng. Mohammed Al Abduwani, the chairman of MPC together with Upma Koul, business development manager and Seppo Hautajoki, managing director of Wärtsilä Gulf Eng. Al Abduwani said, "Musandam Power Company has selected an optimal reciprocating engine (RE) configuration for Musandam's Independent Power Project (IPP) following a completive pre-qualification and tendering process to deliver flexible and sustainable energy to the Musandam Governorate. We will be able to meet the power needs of the current and upcoming projects in the Governorate of Musandam. We are also expecting that the power plant will directly benefit the local community and the people of the Governorate. "In partnership with Wärtsilä, the environmentally-friendly Musandam power plant will use clean natural gas as main

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Page 1: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained

in this publication. However, no warranty is given to the accuracy of its content . Page 1

NewBase 08 December 2014 - Issue No. 492 Khaled Al Awadi

NewBase For discussion or further details on the news below you may contact us on +971504822502 , Dubai , UAE

Oman:Musandam Power, Wärtsilä ink pact for power plant BYTIMES NEWS SERVICE + NEWBASE

Oman Oil Company's (OOC) majority-owned subsidiary Musandam Power Company (MPC)signed the engineering, procurement and construction (EPC) contract and Long Term ServiceAgreement (LTSA) with Wärtsilä Muscat to build a new dual fuel-fired power plant at Tibat wilayatBukha in Musandam Governorate.

Under the agreement, Wärtsilä, a global leader in complete lifecycle power solutions, will design,procure and manage the construction of the 120MW gas-fired power plant, as well as provide on-going maintenance and performance monitoring during the concession period of 15 years from the

commissioning date

The EPC and LTSA agreements were formalised at OOC'shead office by Eng. Mohammed Al Abduwani, the chairman ofMPC together with Upma Koul, business developmentmanager and Seppo Hautajoki, managing director of WärtsiläGulf

Eng. Al Abduwani said, "Musandam Power Company hasselected an optimal reciprocating engine (RE) configurationfor Musandam's Independent Power Project (IPP) following acompletive pre-qualification and tendering process to deliverflexible and sustainable energy to the MusandamGovernorate. We will be able to meet the power needs of thecurrent and upcoming projects in the Governorate ofMusandam. We are also expecting that the power plant willdirectly benefit the local community and the people of theGovernorate.

"In partnership with Wärtsilä, the environmentally-friendlyMusandam power plant will use clean natural gas as main

Page 2: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained

in this publication. However, no warranty is given to the accuracy of its content . Page 2

fuel to maintain the stability of the local electricity supply and support sustainable development inthe governorate while significantly contributing to the Sultanate's energy-production capabilitiesand long-term economic diversification plans. Construction of the new power plant of 120MW isexpected to begin in early December 2014 and is schedule to be ready for full operations by thelast quarter of 2016.

Wärtsilä is the world's fourth-largest supplier of gas and liquid fired power plants with a proventrack record of delivering high energy efficiency and operational and fuel flexibility. MPC, the jointventure between OOC holding a 70 per cent stake, and LG International retaining 30 per centstake, was established in 2014 as Oman's first IPP in Musandam and uses fuel gas to beprocessed by OOC's wholly owned subsidiary, Oman Oil Company Exploration and Production(OOCEP) from the adjacent Musandam Gas Processing Plant, in order to integrate the valuechain and meet the growing demand for energy in the Governorate of Musandam.

Musandam Gas Plant construction , near completion , in Tibat , Musandam , Oman.

Page 3: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained

in this publication. However, no warranty is given to the accuracy of its content . Page 3

Total eyes new blocks offshore the Sultanate (OEPPA Business Development Dept) + NewBase

Energy major Total has pledged to deploy cutting-edge technology solutions to unlock the hydrocarbon potential of Block 41 offshore Oman's northeastern coast, according to a high-ranking executive of the French oil and gas group.

François Bichon, CLOV Project Director -- Total E&P Angola, also voiced the energy giant's keenness to build on its well-established association with the Sultanate's energy sector by acquiring new offshore acreage. "Since 1937, Total has been a long-standing partner of Oman in the development of its oil and gas industry. We are now actively looking for additional blocks where we could apply our expertise and contribute to increasing the reserves and then the subsequent production in Oman," he stated in exclusive comments to the Observer.

Bichon is due in Muscat this week to showcase Total's ground-breaking CLOV project in Angola at the 'Offshore Development Oman' set to be held at Al Bustan Palace -- A Ritz Carlton Hotel during December 9-10, 2014. Organised by well-known event management firm Global Exhibitions and Conferences LLC (GEC) in collaboration with the Ministry of Oil and Gas, the two-day conference will spotlight offshore opportunities in the Sultanate.

Last December, the group's local subsidiary Total Exploration and Production Oman Petroleum BV, signed an Exploration & Production Sharing Agreement (EPSA) with the Omani government for offshore Block 41. Located northwest of Muscat, the concession covers a large unexplored area of almost 24,000 square kilometres in water depths ranging from 30 to more than 3,000 metres. According to Bichon, the company has since made headway in the acquisition of new data from the ultra-deep waters of this block. "The first steps mainly involved acquiring additional data, to complement existing data, aimed at derisking the drilling of the well. Seabed coring was carried out and shallow subsurface geological samples were collected using a weighted corer lowered from the side of a special-purpose vessel. Geochemical studies were carried out on these cores to assess the area's potential," he explained.

Given the challenges posed by these water depths, Total's significant experience around the world in implementing cutting-edge technology solutions without compromising risk management will be a key factor in the exploration and development of Block 41, he noted.

Page 4: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

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in this publication. However, no warranty is given to the accuracy of its content . Page 4

"In short, Total has the necessary knowledge, experience and expertise to overcome these technological challenges -- just as it did in offshore Angola. That is why, in 2015, Total's deep offshore production will represent as much as 10 per cent of all deep-water production in the world, with around 400 subsea wells."

The principal target set by Total as part of the initial activities targeting Block 41 was to de-risk the drilling of the well in the block within one year, with seabed coring being the main work carried out offshore.

This was undertaken with the utmost care and attention in order to take full account of the extremely delicate ecosystem found in coastal waters around Muscat, said Bichon. In the Sultanate, Total is a 4 per cent shareholder in Petroleum Development Oman (PDO) from whose Block 6 concession is produced much of the country's oil and gas output. The Group also has a 5.54 per cent stake in Oman LNG and a 2.04 per cent stake in Qalhat LNG.

Page 5: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained

in this publication. However, no warranty is given to the accuracy of its content . Page 5

Qatar well-positioned to face renewable energy challenges: QSTec chief Gulf Times Correspondent

Dr Khalid K al-Hajri, chairman & CEO, Qatar Solar Technologies (QSTec), addressed the GCC-British Economic Forum on the issue of ‘The Emergence of Sustainable Energy’. He spoke to Gulf Times at the event on how the shift to renewables can best be managed.

He observed: “In order to make the shift to renewables you have to be careful and calculate all the risks associated with it. Each industry has its own challenges; for example, renewables, and the mature industries. We cannot continue using conventional ways and not think about the renewables part which we know will impact positively, helping to resolve the problems of climate change.”

He predicted: “By between 2030 and 2050 we should see around 60% of renewables replacing conventional energy sources.”

Asked about the fall in oil prices and the impact on Qatar, he said: “I am sure that the people in Qatar with responsibility for that area know how to handle that kind of challenge. If we are talking about changing oil prices — well, welcome to the reality of supply of demand.

“But LNG always goes with long term contracts that have secured good prices. So I don’t see that challenge in the same way that others see it. I think that Qatar is in a position to overcome those kind of challenges.”

With regard to relations between the GCC countries, he commented: “We are delighted to see the recent developments between the countries of the GCC and how the future will look. We are six countries but we are one family.”

He also highlighted the strong ties with the UK. “We have a great relationship with the UK. As the secretary-general of the GCC said, ‘We consider London as our second home’.”

Page 6: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained

in this publication. However, no warranty is given to the accuracy of its content . Page 6

Pakistan:OGDCL gas discovery at the Jand-1 well in Punjab Source: OGDCL + NewBase

Oil and Gas Development Company Limited (OGDCL) has discovered

hydrocarbon bearing horizons in its exploratory well Jand # 01. This is the

102nd discovery and a significant landmark achieved by OGDCL.

This well is located in district Attock, Punjab province in Dakhni M.L. with OGDCL (100%)

as operator.

The structure was

delineated, drilled

and tested using

OGDCL's in-house

expertise. The well

was drilled down

to the depth of

6050 metres to

test the

hydrocarbon

potential of the

Sakessar, Chorgali,

Nammal, Patala

and Lockhart

formations.

The Sakessar and

Chorgali

formations have

been tested jointly

delivering 10.60

MMCFD Gas and

21 BPD

condensate

through a 32/64"

choke at a well

head flowing

pressure of 1780

PSI.

Page 7: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained

in this publication. However, no warranty is given to the accuracy of its content . Page 7

UK: Cluff Natural Resources formally awarded five licences in the UK's 28th Offshore Licensing Round. Source: Cluff Natural Resources

Cluff Natural Resources, the AIM quoted natural resources investing company, has announced

that further to the provisional award of promote licences in theUK's 28th Offshore Licencing

Round on 7 November 2014, it has now been formally awarded the five promote licences

covering a total of eleven blocks by the Department of Energy and Climate Change ('DECC').

The specific licences and blocks awarded, all wholly owned by CLNR, are as follows:

The selected blocks are located in an under-explored, emerging gas province of the Southern North Sea, with diverse, high-potential play fairways and trap types in the Carboniferous. Significant interest in the area has recently been rejuvenated by breakthroughs in broadband 3-D seismic surveying technology, which acquires high resolution images below the Permian overburden.

Notable developments in the wider area include the completion of a multi-client 3-D survey (covering CLNR block 42/1 and part of CLNR blocks 41/5 and 41/10), the Pegasus West Gas Discovery (operated by Centrica, which flowed approximately 90MMscf/day on test from Namurian reservoirs), first gas production from the Breagh Field (operated by RWE Dea, estimated to contain nearly 600bcf of recoverable gas reserves) in October 2013 and on-going development of the Cygnus Gas Field (operated by GDF Suez) where first gas production is due in 2015.

All of CLNR's newly awarded blocks are located in relatively shallow water where new conventional gas discoveries can be developed quickly and regional infrastructure is evolving rapidly.

The five licences are awarded on a 'Promote' basis and accordingly have nominal work programmes of obtaining and reprocessing 2-D seismic data, as well as a 90% reduction in annual rentals during the initial two year period. Firm drilling commitments are not required until the end of the second year of the Licences in December 2016, by which time a full geological evaluation and resource assessment will have been completed.

Algy Cluff, Chairman and Chief Executive of CLNR, commented: 'I am delighted to report that DECC has formally awarded our company these new gas licences in this emerging area of the Southern North Sea. CLNR already has a portfolio of eight offshore Underground Coal Gasification Licences totalling 613 km² in the UK and securing eleven North Sea gas blocks over 2,418 km² is a major achievement for the Company.

Page 8: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

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in this publication. However, no warranty is given to the accuracy of its content . Page 8

'This award further establishes our position as a natural resources investment company and underlines our commitment to the UK and to the North Sea where we see significant upside potential for shareholders. CLNR has a strong interest in delivering conventional gas to the UK as well as a determination to safely and cleanly convert offshore coal to gas using UCG technology.'

Page 9: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

redistributed, or otherwise copied without the written permission of the authors. This includes internal distribution. All reasonable endeavours have been used to ensure the accuracy of the information contained

in this publication. However, no warranty is given to the accuracy of its content . Page 9

PNG: Horizon Oil spuds Nama-1 exploration well in PNG Source: Horizon Oil

Horizon Oil has advised that the Nama-1exploration well in PPL 259, Western Province, Papua

New Guinea, spudded at 1000 hrs local time on 4 December 2014. The current operation is

running in the 18 5/8" casing following drilling of the 24” conductor hole. The well is being drilled

by Horizon Oil with Parker Rig 226 and is anticipated to take about 36 days to drill to a planned

total depth of 3,434m.

Nama-1 is located 20 km due east of the Stanley Development, in which all wells found

condensate- rich gas in the Late Jurassic Kimu and Early Cretaceous Toro Sandstones. If

successful, the Nama prospect has the potential to be about the same size as the Stanley field

(certified at 399 bcf of gas and 13 mmbbl condensate).

Participants Interest: Ketu Petroleum (a subsidiary of Horizon Oil) 35%; Eaglewood Energy

(BVI) 45%; Osaka Gas Niugini E&P 10%; Mega Fortune International 10%.

Page 10: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

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in this publication. However, no warranty is given to the accuracy of its content . Page 10

UK: Ineos bets $1 billion upstream in UK shale gas Introducing itself as “THE WORD FOR CHEMICALS”, the Swiss-based company Ineos is maneuvering a strategic breakthrough in planning $1 billion capital expenditure in UK shale gas to feed its petrochemical complex in Grangemouth, Scotland.

Acquired from BP willing to focus on upstream activities, the Ineos Grangemouth refining and petrochemical complex occupies a sensitive position as it supplies 70% of the transportation fuels consumed in Scotland.

Fighting for survival among the European refining over-capacities, this Ineos Grangemouth complex is now facing the competition from the North American petrochemical industry taking advantage of the shale gas lower prices compared with North Sea conventional gas. With operations on both sides of Atlantic, Ineos intents to remain a global player and preserve its European footprint.

In this context, Ineos and Unite union managed to find a deal to align Grangemouth on US labor costs. Ineos also decided to invest in a liquefied natural gas (LNG) import terminal to secure competitive feedstock from US. After completing ethylene expansion in Chocolate Bayou in Texas, USA, Ineos is working on the next step to boost its Grangemouth refining and petrochemical complex with the opportunity to develop the shale gas in UK since this country is willing to take the lead in Europe in the exploration of this unconventional resources in the same way that UK has become a global leader in deep offshore technologies from its North Sea fortune.

While announcing its intention to invest $1 billion in shale gas fields development, Ineos submitted additional applications to the UK Department of Energy & Climate Change (DOE) for new licences.

From the analysis performed by the British Geological Survey, the Midland Valley in Scotland may hold 80 trillion cubic feet (tcf) of gas and 6 billion barrels of oil, but there is still uncertainty about the percentage of recoverable reserves from these unconventional resources.

After recruiting shale gas experts from the US, Ineos started to acquired licenses in different blocks proposed by the UK Government. In August 2014, Ineos took 51% of the 127 square mile Petroleum Exploration and Development Licenses (PEDL) 133 including Grangemouth, Falkirk and Stirling areas. In October 2014, Ineos bought 80% of the 154 square mile PEDL 162 adjacent to the Block 133 on ots east side. Proposing significant incentive to the local inhabitants, Ineos is willing to share profits in order to speed up the development of these unconventional resources for which it is planning to drill hundreds wells over the next five to six years. Due to start first shale gas exploratory operations in 2015, Ineos is then preparing additional investment for thegas treatment and production in the UK by 2020.

Page 11: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

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US:oil reserves rising, surpass 36 billion barrels for first time since 1975 Source: U.S. Energy Information Administration, U.S. Crude Oil and Natural Gas Proved Reserves

U.S. crude oil and lease condensate proved reserves rose for the fifth consecutive year in 2013, increasing by 9% from the 2012 level to 36.5 billion barrels, according to the U.S. Crude Oil and Natural Gas Proved Reserves, 2013report released yesterday by the U.S. Energy Information Administration (EIA). U.S. crude oil and lease condensate proved reserves surpassed 36 billion

barrels for the first time since 1975. Proved reserves

Proved reserves are those volumes of oil and natural gas that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions.

North Dakota had the largest increase (1.9 billion barrels, 51%) in oil reserves among individual states in 2013, based on development of the Bakken/Three Forks formation in the Williston Basin. With 5.7 billion barrels of proved reserves, North Dakota has more reserves than the federal offshore waters of the Gulf of Mexico. Texas remains by far the leading state in total proved oil reserves—its reserves

increased from 11.1 billion barrels in 2012 to 12 billion barrels in 2013 (an 8% increase). The

Page 12: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

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largest decline of 2013 was in Alaska, where proved reserves decreased by 454 million barrels, due mainly to reduced well performance at large existing oil fields.

Changes in reserves reflect exploration and development activities as well as financial factors. Increases in crude oil and lease condensate reserves in 2013 were mainly attributable to nearly 5 billion barrels of extensions to existing fields.

Extensions are the result of additional drilling and exploration in previously discovered reservoirs, and have accounted for the majority of reserves increases over the past three years. Continued development of the Bakken/Three Forks play in North Dakota accounted for a large portion of the reserves additions, and overall, tight oil plays accounted for almost 30% of all U.S. crude oil and lease condensate proved reserves.

EIA's estimates of proved reserves are based on an annual survey of domestic oil and gas well operators. For more information, read the full U.S. Crude Oil and Natural Gas Proved Reserves, 2013 report.

Page 13: New base 492 special  08 december  2014

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US:Natural gas reserves 2013 to reach a record 354 Tcf Source: U.S. Energy Information Administration, U.S. Crude Oil and Natural Gas Proved Reserves

U.S. total natural gas proved reserves increased 10% (31 trillion cubic feet (Tcf)) in 2013 and reached a new U.S. record of 354 Tcf, according to newly published data in EIA's U.S. Crude Oil and Natural Gas Proved Reserves, 2013. Proved reserves

Proved reserves are those volumes of oil and natural gas that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions. At the state level, Pennsylvania and West Virginia reported the largest increases in natural gas proved reserves in 2013, driven by continued development of the Marcellus Shale gas play in the Appalachian Basin.

Pennsylvania added 13.5 Tcf of proved natural gas reserves, an increase of 37% in 2013. West Virginia had the

second-largest increase, an addition of 8.3 Tcf (56%) of natural gas proved reserves. Combined, these two states had 70% of the net increase in U.S. natural gas proved reserves in 2013. Texas, which

Page 14: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

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benefits from having the Barnett and Eagle Ford Shale plays within its borders, had the third-largest increase in 2013—a 5% gain (4.4 Tcf of proved reserves). Proved reserves of natural gas in shale gas plays accounted for 45% (159.1 Tcf) of all U.S. natural gas reserves in 2013.

Alaska had the largest decline in natural gas proved reserves in 2013, the result of deteriorating well performance in certain oil fields. The two fuels are linked because most (87%) of Alaska's natural gas reserves are within reservoirs that also contain and produce crude oil. Changes in reserves reflect both geological and financial factors. In 2012, low natural gas prices led to significant downward revisions to the reserves of existing natural gas fields. As natural gas prices increased in 2013, a portion of those reserves from existing fields were restored by positive net revisions. Other increases in natural gas reserves came from extensions of existing natural gas fields and new discoveries. EIA's estimates of proved reserves are based on an annual survey of domestic oil and gas well operators. For more information, read the full U.S. Crude Oil and Natural Gas Proved Reserves, 2013 report.

Page 15: New base 492 special  08 december  2014

Copyright © 2014 NewBase www.hawkenergy.net Edited by Khaled Al Awadi – Energy Consultant All rights reserved. No part of this publication may be reproduced,

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Oil Price Drop Special Coverage

‘Buckwheat panic’ grips Russians as economic sanctions, oil fall bite AFP

A woman looks at packages of buckwheat on the shelves of a supermarket in St Petersburg. With its warm, fluffy brown grains, buckwheat is the ultimate comfort food for Russians and as sanctions hit home, it is flying off the

shelves in a shopping frenzy dubbed the “buckwheat panic”.

With its warm, fluffy brown grains, buckwheat is the ultimate comfort food for Russians and as sanctions hit home, it is flying off the shelves in a shopping frenzy dubbed the “buckwheat panic”.

Hard-hit by falling oil prices and Western economic sanctions imposed over the Kremlin’s role in the Ukrainian crisis, Russia is seeing a catastrophic depreciation of the rouble and steep inflation.

But while Russians grumble about the rising price of chicken, cheese or sausage, it was only when rumours spread of buckwheat supplies running low that shoppers dashed out to fill their trolleys.

Buckwheat “is not just a food, it is a national idea,” Russia’s leading business daily, Vedomosti, wrote recently in an editorial. While in the West buckwheat is more seen as a trendy food for the health conscious, in Russia it is a traditional staple, predating potatoes.

The cereal, which originates from India and Nepal, was first introduced to the Russians in the 13th century by the Mongol invaders. It was cultivated by Byzantine monks, leading to its name in Russian of “grechka,” which sounds like Greek.

Buckwheat can be eaten at any meal in Russia, whether simmered with milk as a porridge for breakfast, served with chopped liver for lunch, or even stuffed inside a roast piglet at a special

Page 16: New base 492 special  08 december  2014

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dinner. It is ubiquitous in the cafeterias of Russian schools and kindergartens, hospitals, military barracks and prisons.

This autumn as Russians began to feel the effects of sanctions and the retaliatory embargo on most Western foods ordered by President Vladimir Putin, news spread of a low harvest in Russia’s buckwheat heartland—the Altai region in Siberia.

Due to a drought, Russia’s buckwheat harvest fell this year to just under 600,000 tonnes, against the usual 700,000 tons. That was hardly a disaster, but media reports were enough to spark panic demand among consumers with people storming shops across several regions.

“In Moscow, people see a television news report about a buckwheat crisis in Penza”, a city 600 kilometres away, and “in just four days they buy up buckwheat stocks that would normally be enough for two months,” the Moskovsky Komsomoletsdaily wrote.

One supermarket chain in the northwestern city of Saint Petersburg even introduced a five-pack limit for buckwheat purchases. Even though buckwheat is homegrown and so little affected by sanctions or the falling rouble, the price of a packet of buckwheat rose from around 30 roubles to 50 roubles ($0.93) in Moscow and doubled in some regions.

“People store up on buckwheat—which can be kept for a long time—because they do not know what to expect from the (Western) sanctions,” said Galina, a trader at a Saint Petersburg food market. There have been “buckwheat crises” in the past, most recently sparked by a 2010 drought, said Alexei Makarkin, a political analyst with the Centre for Political Technologies.

But what is different now is that “there is no question of a real shortage of buckwheat,” said Dmitry Rylko of the Institute for Agricultural Market Studies. While initially there was no problem with supplies, “excessive demand sparked” the buckwheat crisis, said Alexey Alexeyenko, a senior official at Russia’s food safety agency, Rosselkhoznadzor.

Russian media called the phenomenon “hysteria” or even “buckwheat psychosis.” A survey conducted in late November by the Levada Center pollster found that almost a third of the Russians had stocked up on buckwheat in recent weeks. Buckwheat stockpiling is more a symbol of troubled times, Rylko said, calling it “a sacred food for Russians that disappears at the onset of any signs of crisis.”

The Kremlin’s retaliatory embargo banning Western food imports has hit Russian consumers hard. Prices have gone up 30 to 40% for basic foods such as eggs, pork, chicken, frozen fish and sausage since the counter sanctions were imposed.

Page 17: New base 492 special  08 december  2014

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in this publication. However, no warranty is given to the accuracy of its content . Page 17

Iran unveils budget based on lower oil price of $70/barrel Reuters + AFP Iranian parliament members arrive before President Hassan Rouhani presented the budget in Tehran yesterday. Iran unveiled a draft budget yesterday for next year based on oil prices remaining around $70 per barrel, with President Hassan Rouhani saying the country would become less dependent on crude.

With international prices at five-year lows on the back of oversupply worries and a stronger dollar, major oil producers are having to juggle their finances to compensate for lower than expected revenues. Rouhani admitted the budget for the fiscal year starting in March 2015 “would be under pressure” given the big fall in oil prices in recent months, from above $100 to less than $70.

“Such a drop is unprecedented,” he said in a speech to parliament carried live on state television, noting that the government had been cautious in its forecasts. “In the short term, we will have a decrease in our revenues. Our economy must move towards non-oil exports. The oil price drop is a new opportunity to accelerate this.” Iran has the world’s fourth largest proven oil reserves and currently exports around 1.3 million barrels per day. However, Rouhani said oil revenues earmarked for the budget would be $24bn next year, down from $27.5bn, meaning less than half the government’s income would come from exported crude. Iran had already announced some tax rise plans on the back of the recent oil price fall, along with increases in non-oil exports. Next year’s non-oil-based revenues will constitute more than half the government’s total income, rising to 53 percent from the current 47 percent, according to forecasts. Total spending will rise 8.5 percent. Rouhani did not state a figure for the price of oil per barrel laid down in the budget, but the official IRNA news agency said it was fixed at $72 — down from around $100 in the current budget year. Other changes have also been necessary. Money from oil sales put into the National Development Fund used to finance major infrastructure projects will drop from 31 percent to 20 percent “to avoid too much pressure on the budget”, Rouhani said.

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Defence expenditure to increase by 33.5pc

DUBAI: President Hassan Rouhani will hike military spending by more than a third in the next fiscal year despite presenting a “cautious, tight” budget in response to falling oil prices and punishing sanctions. Rouhani proposed a general budget of 8,400 trillion rials.

Defence expenditure will rise 33.5 percent to about 282 trillion rials, most of which will be assigned to the elite Revolutionary Guards. The Guards’ budget will increase by about half to 174 trillion rials. Iran is stockpiling rockets, missiles and other conventional weapons.

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Khaled Al Awadi is a UAE National with a total of 25 years of experience in the Oil & Gas sector. Currently working as Technical Affairs Specialist for Emirates General Petroleum Corp. “Emarat“ with external voluntary Energy consultation for the GCC area via Hawk Energy Service as a UAE operations base , Most of the experience were spent as the Gas Operations Manager in Emarat , responsible for Emarat Gas Pipeline Network Facility & gas compressor stations . Through the years , he has developed great

experiences in the designing & constructing of gas pipelines, gas metering & regulating stations and in the engineering of supply routes. Many years were spent drafting, & compiling gas transportation , operation & maintenance agreements along with many MOUs for the local authorities. He has become a reference for many of the Oil & Gas Conferences held in the UAE and Energy program broadcasted internationally , via GCC leading satellite Channels.

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