[pt] O cenário atual da indústria de gás natural brasileira é caracterizado por baixa maturidade e dinamismo de mercado. O comportamento estocástico da demanda por gás, somado volatilidade do preço de mercado do GNL, motiva a utilização de estocagem subterrânea como forma de inserir flexibilidade no suprimento, além de promover proteção contra flutuação no preço. No entanto, a literatura existente carece de uma uma ferramenta analítica mais robusta para apoiar uma análise quantitativa dos benefícios que a atividade UNGS poderia proporcionar à indústria de gás natural. Nesta tese, propomos um modelo de programação dinâmica estocástica para planejamento de longo/médio prazo, a fim de determinar a política ótima de fornecimento juntamente com a possibilidade de armazenamento de gás. Um modelo markoviano caracteriza a demanda termoelétrica, enquanto o preço de GNL é representado por um processo estocástico temporalmente independente. O modelo proposto é eficientemente resolvido usando o algoritmo de programação dinâmica dual estocástica para o estudo de caso brasileiro, considerando dados dos setores de gás e setor elétrico. Para uma escolha exógena, mas significativa, da localização e tamanho do armazenamento subterrâneo, observamos os benefícios operacionais e econômicos da flexibilidade que esta atividade poderia proporcionar. Além disso, comparando os custos de OPEX e CAPEX de investimentos em infraestrutura de armazenamento em campos depletados e cavernas de sal com as economias proporcionadas pelo armazenamento na operação de fornecimento, é possível observar o benefício econômico da atividade de estocagem. A estrutura proposta fornece suporte quantitativo importante para discussões sobre precificação de infraestrutura e modelo de negócios para Armazenamento Subterrâneo de Gás Natural. / [en] The current scenario of the Brazilian natural gas industry is characterized by low maturity and dynamism of the market.The stochastic behavior of Brazilian demand for natural gas, added to its associated market price volatility, motivates the usage of underground storage due to supply flexibility and protection against price fluctuations. However, the existing literature lacks a more robust analytical tool to support a quantitative analysis of the benefits that the UNGS activity could provide to the natural gas industry. In this thesis, we propose a stochastic dynamic programming model for long/medium term planning to determine the supply optimal policy together with the possibility of storing gas. A markovian model characterizes thermoelectric demand while market price is represented by a stagewise independent stochastic process. The proposed model is efficiently solved using the Stochastic Dual Dynamic Programming algorithm for the Brazilian case study considering realistic data for the actual gas network and electric power system. For an exogenous but meaningful choice of underground storage location and size, we observe the operational and economic benefits of the provided storage flexibility. Additionally, comparing the OPEX and CAPEX costs of investments in storage infrastructure in depleted fields and salt caverns with the savings provided by storage in the supply operation, it is possible to observe the economic benefit of storage. The proposed framework provides an important quantitative support for discussion about Underground Natural Gas Storage infrastructure pricing and business models.

The work presented in this thesis was undertaken as part of the safety work package of the NATURALHY project which was an integrated project funded by the European Commission (EC) within the sixth framework programme. The purpose of the NATURALHY project was to investigate the feasibility of using existing natural gas infrastructure to assist a transition to a hydrogen based economy by transporting hydrogen from its place of production to its place of use as a mixture of natural gas and hydrogen. The hydrogen can then be extracted from the mixture for use in fuel cells or the mixture used directly in conventional combustion devices. The research presented in this thesis focused on predicting the consequences of explosions and fires involving natural gas and hydrogen mixtures, using engineering type mathematical models typical of those used by the gas industry for risk assessment purposes. The first part of the thesis concentrated on modifying existing models that had been developed to predict confined vented and unconfined vapour cloud explosions involving natural gas. Three geometries were studied: a confined vented enclosure, an unconfined cubical region of congestion and an unconfined high aspect ratio region of congestion. The modifications made to the models were aimed at accounting for the different characteristics of a natural gas/hydrogen mixture compared to natural gas. Experimental data for the laminar burning velocity of methane/hydrogen mixtures was obtained within the safety work package. For practical reasons, this experimental work was carried at an elevated temperature. Predictions from kinetic modelling were employed to convert this information for use in models predicting explosions at ambient temperature. For confined vented explosions a model developed by Shell (SCOPE) was used and modified by adding new laminar burning velocity and Markstein number data relevant to the gas compositions studied. For vapour cloud explosions in a cubical region of congestion, two models were used. The first model was developed by Shell (CAM2), and was applied using the new laminar burning velocity and other composition specific properties. The second model was based on a model provided by GL Services and was modified by generalising the flame speed model so that any natural gas/hydrogen mixture could be simulated. For vapour cloud explosions in an unconfined high aspect ratio region of congestion, a model from GL Services was used. Modifications were made to the modelling of flame speed so that it could be applied to different fuel compositions, equivalence ratios and the initial flame speed entering the congested region. Predictions from the modified explosion models were compared with large scale experimental data obtained within the safety work package. Generally, (apart from where continuously accelerating flames were produced), satisfactory agreement was achieved. This demonstrated that the modified models could be used, in many cases, for risk assessment purposes for explosions involving natural gas/hydrogen mixtures. The second part of thesis concentrated on predicting the incident thermal radiation from high pressure jet fires and pipelines fires involving natural gas/hydrogen mixtures. The approach taken was to modify existing models, developed for natural gas. For jet fires three models were used. Fuel specific input parameters were derived and the predictions of flame length and incident radiation compared with large scale experimental data. For pipeline fires a model was developed using a multi-point source approach for the radiation emitted by the fire and a correlation for flame length. Again predictions were compared with large scale experimental data. For both types of fire, satisfactory predictions of the flame length and incident radiation were obtained for natural gas and mixtures of natural gas and hydrogen containing approximately 25% hydrogen.

Thesis (MBA (Business Management))--University of Stellenbosch, 2009.

The Saudi Arabian natural gas industry and its downstream activity, particularly petrochemicals, is characterized by its dependence on the country's crude oil production. This is because the main input into these industries is associated natural gas. Most of the Saudi gas-based petrochemical products are sold in international markets where their cost advantage over naphtha-based products is directly proportional to the crude oil price. The profits from Saudi natural gas and its dependent industries are influenced by two countervailing factors. The first is that of the level of crude oil production which determines the utilization level of the gas industry. The second is the international crude oil price on which the returns from petrochemicals, liquified petroleum gases and natural gasoline are directly proportional. This creates a tradeoff situation and necessitates finding a crude oil production level subject to optimizing the country's gas utilization system. A linear programming model is constructed to establish this level and to investigate possible ways to satisfy the country's future gas requirement. The results of the model indicate that the associated gas produced in conjunction with 6.78 million barrels of crude oil per day is needed to operate the gas utilization system at capacity. However, the model estimates that gas associated with a daily crude oil production level of 4.35 million barrels produces the highest returns from the system. Furthermore, to meet the country's gas requirements for 1990 and 2000, based on 4.35 million barrels per day of crude oil, the current daily nonassociated gas capacity should be expanded to 2.27 and 3.15 billion cubic feet, respectively.

Energy markets feature a wide range of unusual price behaviour along with a complicated dependence structure between electricity, natural gas, coal and carbon, as well as other variables. We approach this broad modelling challenge by firstly developing a structural framework to modelling spot electricity prices, through an analysis of the underlying supply and demand factors which drive power prices, and the relationship between them. We propose a stochastic model for fuel prices, power demand and generation capacity availability, as well as a parametric form for the bid stack function which maps these price drivers to the spot electricity price. Based on the intuition of cost-related bids from generators, the model describes mathematically how different fuel prices drive different portions of the bid stack (i.e., the merit order) and hence influence power prices at varying levels of demand. Using actual bid data, we find high correlations between the movements of bids and the corresponding fuel prices (coal and gas). We fit the model to the PJM and New England markets in the US, and assess the performance of the model, in terms of capturing key properties of simulated price trajectories, as well as comparing the model’s forward prices with observed data. We then discuss various mathematical techniques (explicit solutions, approximations, simulations and other numerical techniques) for calibrating to observed fuel and electricity forward curves, as well as for pricing of various single and multi-commodity options. The model reveals that natural gas prices are historically the primary driver of power prices over long horizons in both markets, with shorter term dynamics driven also by fluctuations in demand and reserve margin. However, the framework developed in this thesis is very flexible and able to adapt to different markets or changing conditions, as well as capturing automatically the possibility of changes in the merit order of fuels. In particular, it allows us to begin to understand price movements in the recently-formed carbon emissions markets, which add a new level of complexity to energy price modelling. Thus, the bid stack model can be viewed as more than just an original and elegant new approach to spot electricity prices, but also a convenient and intuitive tool for understanding risks and pricing contracts in the global energy markets, an important, rapidly-growing and fascinating area of research.

National oil companies (NOCs) control over 80 percent of world oil reserves and over 50 percent of gas reserves and hold exclusive rights to exploration and development of oil and gas reserves within their home countries. Because of host government involvement and supervision, NOCs may also act as instruments of state, implementing government foreign and domestic policies such as wealth re-distribution through the provision of subsidised oil products, job creation, and economic development. Such activities can lead to restricted availability of funds for finding and developing reserves for future production and to inefficiencies in current production and distribution. This thesis assesses the geopolitical factors that influence the conduct, strategies and priorities of NOCs and how these may impact on the continuing security of energy supplies to countries which are members of the Organisation for Economic Co-operation and Development (OECD). It will focus on ten NOCs supplying oil to world markets and two which supply gas to the European market. The study will also review the activities and .scope for influence as state instruments of Sovereign Wealth Funds which have been established by states with NOCs, in particular, those which have earned substantial petro-dollar surpluses, during the period of high oil and gas prices of2006-2008. In an age of global interdependence between nations, specific objectives of this thesis are to consider the implications of anticipated growth in world demand for oil and gas supplies over the next 20 years, whether world production capacity is likely to grow to meet increases in world demand, the potential impact on world oil and gas supplies of the policies and practices of NOCs, in particular, the desire of host governments to require NOCs to follow non- commercial objectives, and the responses from OECD countries to threats to their energy security from potential restrictions on supplies.

This dissertation aims to explain the conditions under which expertise can undermine democratic decision making. I argue that the root of the conflict between expertise and democracy lies in what I call insufficiently “representative” expertise – that is forms of scientific research that are not relevant to the policy questions at hand and that fail to make visible their hidden values dimensions. I claim that the scholarly literature on the problem of expertise fails to recognize and address the issue correctly, because it does not open the black box of scientific methodologies. I maintain that only by making sense of the methodological choices of experts in the context of policy making can we determine the relevance of research and reveal the hidden socio-political values and consequences. Using the case of natural gas fracking, I demonstrate how expert contributions – even though epistemically sound – can muddle democratic policy processes. I present four case studies from controversies about fracking to show how to contextualize scientific methodologies in the pertinent political process. I argue that the common problem across all case studies is the failure of expertise to sufficiently represent stakeholders’ problems and concerns. In this context, “representation” has three criteria: (1) the operational research questions on which the qualified experts work are relevant to stakeholders’ problems and concerns; (2) the non-epistemic values and consequences of epistemic choices of experts are compatible with social and political values and priorities; and (3) hidden values attached to facts are fully transparent and openly debated. In the conclusion, I propose a normative version of this representation theory that can be used to evaluate the appropriateness of expertise for democratic policy making. Instead of the value-free science ideal, I propose a new ideal to legitimately allow non-epistemic values in scientific reasoning without compromising the soundness of research.

Master of Science / Department of Chemical Engineering / James Edgar / In the past decade the technique of horizontal drilling and hydraulic fracturing has been improved so much that it has become a cost effective method to extract natural gas from shale formations deep below the earth’s surface. Natural gas extraction has boomed in the past few years in the United States, enough that it has driven prices to an all time low. The amount of natural gas reserves in the U.S. has led to claims that it can lead the country to energy independence. It has also been touted as a cleaner fuel for electricity generation and to power vehicles. This report explains hydraulic fracturing and horizontal drilling particularly with regards to utilizing the techniques for natural gas extraction from shale gas. It also discusses the environmental impact due to the drilling and gas extraction. It demonstrates that although the natural gas beneath the U.S. is a valuable resource, the impacts to the planet and mankind are not to be taken lightly. There is the potential for the effects to be long term and detrimental if measures are not taken now to control them. In addition although on the surface natural gas seems to be a greener fuel, particularly in comparison to gasoline, it is also considered worse for the environment.

[pt] Este estudo tem como motivação as incertezas relacionadas ao suprimento de gás natural no Brasil nos próximos anos em função de possíveis atrasos nos projetos do Pré-Sal. Para mitigar o risco da produção de gás natural ficar aquém da planejada para os próximos anos, a Petrobras vem ampliando as alternativas para a oferta de gás natural através da construção de terminais de regaseificação de Gás Natural Liquefeito (GNL). Dentro deste cenário é analisada a viabilidade de construção de um Complexo Gás-químico para a produção de fertilizante nitrogenado e outros produtos químicos, considerando que a planta tem a opção de complementar o suprimento pleno do complexo por meio da importação de GNL nos períodos em que a oferta de gás natural for insuficiente para atender o consumo total desta planta. É utilizada a distribuição triangular e processos estocásticos de reversão à média para modelaras incertezas relativas às variáveis suprimento e preço, respectivamente, e simulação de Monte Carlo para o apreçamento da opção de troca de insumos. Os resultados obtidos indicam que a opção por GNL como complementação do suprimento pleno do Complexo aumenta o valor do projeto, comprovando que este é uma alternativa economicamente viável e atrativa. / [en] This study was motivated by the uncertainties related to the natural gas supply in Brazil in the coming years due to possible delays in the Pre-Salt projects. To mitigate the risk of natural gas production falling short of planned for the coming years, Petrobras has been expanding the alternatives for the natural gas supply by building regasification of Liquefied Natural Gas (LNG) terminals. Within this scenario is analyzed the feasibility of building a gas chemical complex to produce nitrogenous fertilizer and other chemicals, considering that the plant has the option to complement the plentiful supply of the complex by importing LNG in periods that the natural gas supply is insufficient to meet the total consumption of this plant. The triangular distribution and stochastic mean reversion is used to model uncertainties regarding supply and price variables, respectively, and Monte Carlo simulation for pricing the option to switch inputs. The results indicate that the choice of LNG as a supply of full complementation of he complex increases the value of the project, proving that this is a viable and economically attractive alternative.

Student Number : 9202134A - PhD thesis - School of Civil and Environmental Engineering - Faculty of Engineering and the Built Environment / South Africa’s energy economy is dominated by coal, which produces relatively high emissions of greenhouse and noxious gases during combustion. This causes environmental problems that may lead to health risks that are cause for concern. In this thesis, various propositions are tested about whether in the Cape Metropolitan Area natural gas is a lower cost energy source than coal for generating base load power within a specified range of capacity factors under different scenarios. The problem being investigated is the uncertainty about the quantified effect that revenue from monetised carbon dioxide credits and inclusion of damage costs would have on the breakeven selling price of electricity, if natural gas were substituted for coal for generating base load power in the above Area. The research procedure entailed conceptualising and developing technical details of four power generation scenarios and reviewing various tools for cost-benefit analysis. Next, a Te- Con Techno-Economic Simulator model and screening curves were selected from a suite of potential tools. The power generation cost profiles for coal and natural gas were determined, followed by sensitivity analysis. The model was populated and used to compare the lifecycle economic performance of coal and natural gas technologies. Natural gas emerged as a lower cost energy source than coal for generating base load power within a specified range of capacity factors under all the scenarios. This thesis recommends the following: the introduction of tax holidays and favourable capital equipment depreciation regimes to stimulate natural gas exploration; the use of natural gas as an energy source to promote small-scale enterprises in communities contiguous to gas transmission pipelines; in addition, electricity prices should reflect damage costs in order to internalise externalities associated with power generation. The contribution to knowledge is the innovative way of financing the gas-fired power generation project by using the monetised carbon dioxide credits under the novel Clean Development Mechanism to redeem a bank and a shareholders’ loan. This could result in reducing the loan payment by 4.3 years, saving 38 % in interest payments and allow scarce finance available for project funding to be extended to other projects to the advantage of national economic development.