1. 1 LECTURE 1 OVERVIEW OF ENERGY INDUSTRY Course Learning Outcome (CLO) Identify, discuss and analyse the important contributions of up- stream and downstream activities towards the development of hydrocarbon gas industry

2. 2 PREFACE (A reminder to Myself ) Verily! In the creation of the heavens and the earth, and in the alternation of night and day, and the ships which sail through the sea with that which of use to mankind, and the rain which God sends down from the sky and makes the earth alive therewith from its death, and the moving (living) creatures of all kinds that He scatters therein, and in the veering of winds and clouds which are held between the sky and the earth, are indeed signs/proofs/evidences for people of understanding

3. 3 ENERGY for LIVING What is energy? Supply vs demand…..factors ? Energy resources? Energy production…..methods? Energy associated-problems?

4. 4 WORLD ENERGY CONSUMPTION –Projected 60 percent increase from 1999 to 2020 –90 % of the world's consumption of the commercial supply of energy is derived from the three fossil fuels, i.e oil, coal and natural gas –Oil has been the world’s dominant source of primary energy consumption – expected 40-percent share of total energy consumption over the 1999-2020 period –Natural gas is projected the fastest growing source of energy consumption –Projected slow growth in coal consumption, averaging 1.7 percent per year through 2020 –Nuclear generation is projected for the developing world, where consumption of electricity from nuclear power is projected to increase by 4.7 percent per year between 1999 and 2020 –Renewable energy use is expected to increase by 53 percent between 1999 and 2020

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9. 9 Non-Renewable Energy Sources Conventional –Petroleum –Natural Gas –Coal –Nuclear Unconventional –Shale / Tight Gases –Methane hydrates –Coal bed methane (CBM)

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11. Recent Worldwide Estimates of Unconventional Gas in Place, (Tcf) Rogner 1997

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13. How long will it last? Things to take into account –Reserves –Rate of use –Recovery percent –Undiscovered Resources –Price –New Technology

16. What are the environmental concerns? Oil Spills Pollution Transportation infrastructure ?

17. 10 Most Expensive Accidents Ever in History 10. Titanic - $150 Million 9. Tanker Truck vs. Bridge - $358 Million 8. MetroLink Crash - $500 Million 7. B-2 Bomber Crash - $1.4 Billion 6. Exxon Valdez - $2.5 Billion 5. Piper Alpha Oil Rig - $3.4 Billion 4. Challenger Explosion - $5.5 Billion 3. Prestige Oil Spill - $12 Billion 2. Space Shuttle Columbia - $13 Billion 1. Chernobyl - $200 Billion 17

18. Deadliest Oil & Gas Related Accidents 18

19. Most Expensive Oil & Gas Related Accidents 19

21. 21 Renewable Energy Sources Solar energy –Solar Photovoltaics –Solar thermal power –Passive solar air and water heating Wind Hydropower Biomass Ocean energy Geothermal Waste to Energy

22. 22 TW – Terawatt (1 trillion – 10 12 )

23. Total potential for renewable electricity in 2030 for ASEAN 23 Source: IEA, 2010

24. 24 OIL AND GAS INDUSTRY IN MALAYSIA

31. SectorExample of Companies Gas IndustryPetronas, Exxon-Mobil, Shell, Gas Malaysia PetrochemicalBP Amoco, Optimal, MTBE, Ethylene & Polyethylene Oleo ChemicalFelda, Kao Oleochemical, Cognis Oleochemical ChemicalTitan Chemicals, Toray Industries Inc,, Eastmam Chemical, Kaneka Biotechnology IndustryAbbott Laboratories, Glaxo Smith Kline, Pfizer Food IndustryCargill Inc., Nestle, Gardenia

34. Petronas operations in 33 countries

35. Gas Well Regasification LNG Transport Liquefaction City Gate Industries Commercial Residential Petrochemical & Power Plant

36. Process SARAWAK SABAH, PENINSULAR MALAYSIA & OTHERS Liquefaction Export as LNG Power Generation & Petrochemical Fuel for Industry Commercial & Residential

38. $/MMBt u $/boe Distance to Market (km) Gas Pipeline - Offshore Gas Pipeline - Onshore LNG

39. In Operation Under Construction Alaska Trinidad & Tobago Norway Australia Brunei Indonesia Malaysia Abu Dhabi Qatar Oman Algeria Libya Egypt Equatorial Guinea Nigeria Russia (Sakhalin)

40. DESCRIPTION 2005 $US Billion 2008 $US Billion Upstream1.3 – 3.25.0 – 6.0 Liquefaction2.5 – 5.011.0 – 12.0 Shipping1.1 – 2.23.0 – 4.0 TOTAL4.9 – 10.419.0 – 22.0

41. 41 Refinery and Petrochemical Integrated Development (RAPID) project Petronas will invest in a major RM60bil integrated refinery and petrochemical complex in Pengerang, Johor, touted to be its largest. To be known as the Refinery and Petrochemicals Integrated Development (Rapid) project, it is is expected to be commissioned by the end of 2016, as part of the national oil company's efforts to expand its downstream production. The mammoth project is expected to create at least 20,000 jobs during the construction phase and 4,000 potential jobs for highly-skilled workers.

42. 42 The Rapid project would consist of three main components: > A crude oil refinery with a capacity of about 300,000 barrels per day, larger than the combined capacities of its refineries in Malacca and Kerteh. > A naphtha cracker with the ability to produce three million tonnes of ethylene, propylene as well as C4 and C5 olefins; and > A joint petrochemical development with a combined production capacity of three million tonnes per year, more than the combined production capacities of its integrated complexes in Kerteh and Gebeng, Pahang.

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