TPT May 2017

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G LOBA L MARKE T P L AC E
62 MAY 2017
› Finance editor Lianna Brinded of Business Insider was
less measured about the Oil & Gas UK report. After
reviewing its contents she summarised its essential message:
“Operators in the North Sea are finally going to be making
money again.”
Technology
A novel catalyst holds promise for monetising
wasted methane
A Washington State University (WSU) research team reported
having improved upon an important catalytic reaction in
common use in the oil and gas industry, an innovation
that the researchers believe could lead to dramatic energy
savings and reduced pollution. Their paper detailing the work
appeared in the German journal Angewandte Chemie, which
flagged it as being of special interest and importance.
Reporting on the research for Science X, Tina Hilding noted
that methane gas is a by-product of much oil and gas
production, in which its build-up can be a safety concern.
Methane is also a constituent of natural gas, convertible
into electricity when the strong bond between its carbon and
hydrogen is broken. But this takes a tremendous amount of
energy. “[Methane is] a very happy molecule,” said Jean-Sabin
McEwen, co-leader, with Su Ha, of the research team at the
WSU School of Chemical Engineering and Bioengineering.
“It does not want to break apart.” (“WSU Research Advances
Energy Savings for Oil, Gas Industries,” 27 February)
Conventional methane conversion employs a nickel-based
catalyst. But it is often less expensive to simply burn the
methane in giant flares on-site, adding greenhouse gases to
the atmosphere, contributing to global warming, and wasting
energy. In the US, burned methane accounts for as much
as 25 per cent of annual natural gas consumption. The
researchers determined that they can dramatically reduce
the energy needed to break the bond between carbon and
hydrogen by introducing a bit of carbon within the nickel-
based catalyst. This creates nickel carbide, which generates
a positive electrical field, weakening the methane molecule’s
hydrogen-carbon bond and allowing it to break at much lower
temperatures.
The researchers found that while too much carbon in the
catalyst kills the reaction, a very low concentration actually
enhances it. They have built a numerical model of the
reaction and are exploring ways to demonstrate the work
experimentally. Professor Ha said: “If we can efficiently and
effectively convert methane from shale or gas fields to electric
power or useful products, that would be very positive.”
Elsewhere in oil and gas . . .
› According to Juan Carlos Zepeda, the head of Mexico’s
oil regulator CNH, a pipeline network with spare capacity
could allow Mexico to export oil and gas from its flagship
deepwater Trion project to the US. An exporter of crude oil,
Mexico is also a gas importer. Trion could help the country
reduce its imports.
The field, with prospective reserves of almost 500 million
barrels of oil in the Gulf of Mexico, was leased out in December
by state-run Pemex to Australia’s BHP Billiton, which became
the operator of the $11bn project. As noted by Reuters (9
March), the Mexican oil company, which retains a 40 per cent
stake, “jointly shares for the first time the risks and rewards of
a potentially lucrative project with a private producer.”
The Great White Field, operated by Royal Dutch Shell, BP
and Chevron, is producing around 70,000 barrels per day
(bbl/d), Mr Zepeda said, leaving 50 per cent available capacity
in a crude line and a gas line connected to the US. He pointed
out to Reuters that it is only 24 miles from the Trion Field to
the Great White’s facilities.
› As reported by Reem Shamseddine on the maritime
and offshore website gCaptain (8 March), US oilfield
services and equipment provider McDermott International
(Houston, Texas) has said it will build a fabrication yard at
the shipbuilding complex planned by national oil giant Saudi
Aramco for Ras Al Khair, on the east coast of Saudi Arabia.
The two companies signed a memorandum of understanding
for the first major manufacturing investment in the complex,
part of Saudi Arabia’s drive to diversify its economy and create
jobs in an era of cheap oil.
Saudi officials have estimated the cost of the Ras Al Khair
complex at more than $5bn. According to the gCaptain
notice, the kingdom wants to jump-start local manufacturing
industries by making more of the equipment required for its
oil industry.
Cor por at ion taxes in the US
The belief persists that the US corporate
income tax rate is too high, even when
billion-dollar companies pay no taxes
“Complaining that the US has one of the world’s highest
corporate tax levels, President Trump and congressional
Republicans have repeatedly vowed to shrink it.”
Patricia Cohen of the New York Times was taking note of
a truism of the US political scene: that a cripplingly high
corporate tax rate – topped out at 35 per cent – is impeding
American competitiveness and penalising American initiative.
She followed up with a question: why, then, if the level is so
high, have so many US companies’ income tax bills added up
to zero?
That is what is shown by a new analysis of 258 “Fortune 500”
companies earning more than $3.8tn in profits. The report,
by the Institute on Taxation and Economic Policy, found that,
exploiting loopholes and pursuing aggressive strategies,
those 258 corporations paid tax at an average rate of 21.2
per cent. Ms Cohen reported the further finding that 100 of