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Japan, Saudi Arabia sign mining, mineral resources pact

Japan, Saudi Arabia sign mining, mineral resources pact
The agreement was inked in Riyadh between Japan’s Economy, Trade and Industry Minister Ken Saito and Saudi Arabia’s Industry and Mineral Resources Minister Bandar AlKhorayef. (X/@mimgov)
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Updated 25 December 2023
Arab News Japan
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Japan, Saudi Arabia sign mining, mineral resources pact

Japan, Saudi Arabia sign mining, mineral resources pact
  • Two nations have already agreed to seek access to nickel, lithium for electric-vehicle batteries
Updated 25 December 2023
Arab News Japan
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DUBAI: Saudi Arabia and Japan have signed a pact to expand cooperation in the mining and mineral resources sector.

The agreement was inked on Sunday in Riyadh between Japan’s Economy, Trade and Industry Minister Ken Saito and Saudi Arabia’s Industry and Mineral Resources Minister Bandar AlKhorayef.

The pact highlights Japan’s commitment to work with the Kingdom, which has a stable supply of minerals, while Saudi Arabia aims to diversify its economy.

Earlier this month, the two ministers met to discuss further economic cooperation, with Saito highlighting the benefits of the Japan-Saudi Vision 2030 agreement.

In March, Saito visited Riyadh and signed an agreement with Saudi Arabia to invest in Africa and other resource-rich nations — with a focus on securing interests in nickel, lithium and other minerals for the production of electric vehicle batteries.

Saito stated: “We would like to promote efforts to strengthen the supply chain of important minerals by actively involving companies from both countries.

In addition, Saito also met with Saudi Arabia’s Minister of Investment Khalid Al-Falih to discuss economic relations.

Meanwhile, the National Debt Management Center and the Ministry of Finance signed a memorandum of understanding with the Japan Bank for International Cooperation that is expected to explore the potential expansion of the existing relationship and cooperation to facilitate activities of mutual benefit and foster further cooperation between the two sides.

The National Water Company and the Japanese FujiClean Company signed on Sunday a memorandum of understanding to foster cooperation in the transfer, localization, and development of advanced wastewater treatment technologies produced by FujiClean. 

The goal is to register cutting-edge technologies as global products in the Kingdom, facilitating their application in wastewater treatment operations throughout the country and the surrounding region.

NWC Executive Deputy for Projects and Technical Services Sector Mansour Abu Thunain stressed that the memorandum aligns with the company’s ongoing efforts to localize wastewater treatment technologies and seeks to establish partnerships and collaborations with local and international entities to improve the water industry.
 
He said the features of the new Japanese technology, which boasts user-friendly operation, cost-effectiveness, and a minimal space requirement, make it suitable for deployment in remote and dispersed population areas, utilizing a decentralized approach to contribute to expanding wastewater services throughout the Kingdom.

Underlining NWC’s commitment as a national company, Abu Thunain said it will collaborate with the Japanese side to implement an empowerment and localization program for the technologies offered by FujiClean. 

The comprehensive initiative includes developing training programs for NWC engineers and technicians, as well as expanding current capabilities and the national workforce through collaboration with both local and foreign sectors, under the terms outlined in the memorandum.

Topics: Saudi Arabia Japan Bandar Al-Khorayef

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Energy efficiency investment to hit $660bn in 2024

Energy efficiency investment to hit $660bn in 2024
Updated 5 sec ago
Miguel Hadchity
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Energy efficiency investment to hit $660bn in 2024

Energy efficiency investment to hit $660bn in 2024
  • Skilled labor shortages and cooling solutions among key challenges, IEA warns
Updated 5 sec ago
Miguel Hadchity

 

RIYADH: The International Energy Agency has projected global investment in energy efficiency to reach a record $660 billion in 2024, maintaining the levels seen in 2022.

Significant increases are expected in emerging markets, with Africa anticipated to see a 60 percent rise, the Middle East a 40 percent increase, and Latin America a 20 percent boost.

Despite this positive growth, the Energy Efficiency 2024 report emphasizes that to meet net-zero targets by 2030, global investment in energy efficiency needs to rise to $1.9 trillion.

A major hurdle in achieving these ambitious targets is the ongoing shortage of skilled labor in the energy sector. The IEA report highlights a critical need for workers in specialized fields like HVAC (heating, ventilation, and air conditioning), heat pump installation, and electrical work to support the growing demand for energy-efficient technologies.

To address this skills gap, the IEA calls for more inclusive policies that encourage greater participation of women in the energy workforce. Women currently represent less than 20 percent of the energy sector, despite making up 39 percent of the global labor force. Increasing women’s representation in the sector could help fill the labor shortage and accelerate energy efficiency progress.

The report also points to the urgent need for energy-efficient cooling solutions in response to rising global temperatures. With 2024 seeing record-breaking heatwaves and soaring air conditioner sales, the IEA stresses that efficient cooling systems can alleviate pressure on electricity grids, especially in regions like Southeast Asia, where efficient air conditioners offer substantial lifetime savings.

These models are becoming increasingly cost-competitive in rapidly growing markets, helping to reduce both energy consumption and grid strain.

The IEA also underscores the critical role that energy efficiency plays in reducing reliance on fossil fuels. In its net-zero emissions by 2050 scenario, the IEA projects that energy efficiency improvements could account for more than a third of the carbon dioxide reductions needed by 2030.

For instance, a transition to electric vehicles and improvements in building insulation could reduce oil demand to levels equivalent to China’s total oil consumption and cut natural gas consumption to levels comparable to Europe’s total use in 2024.

The report highlighted notable progress toward the energy efficiency targets set at the 2023 COP28 summit, where nearly 200 countries committed to doubling the global rate of energy efficiency improvements by 2030. The IEA views this as a significant milestone for energy efficiency in global policy.

However, the global energy efficiency improvement rate for 2024 is projected to remain at 1 percent, consistent with the previous year. The report emphasizes that meeting the targets will require a much stronger push in policy implementation and stronger enforcement of energy efficiency measures.

A key driver of progress is electrification, which is expected to increase by nearly 2 percent in 2024. The growing adoption of electric vehicles and energy-efficient air conditioners, especially in regions facing extreme heat like India and Southeast Asia, is accelerating this transition.

The report also highlights regional trends, with China and India projected to see energy efficiency improvements of 1.5 percent and 2.5 percent, respectively. These gains are largely supported by national policies aimed at promoting energy-efficient technologies and encouraging the adoption of EVs.

“China, India, Southeast Asia, Africa, and Latin America together account for nearly half of global energy demand, positioning these regions as key drivers of global energy efficiency improvements in the years ahead,” the report said.

To support global efforts, the IEA has launched the Energy Efficiency Progress Tracker, a new tool that provides real-time data on national and regional trends in energy intensity, demand, and electrification. This tracker is designed to help policymakers and stakeholders monitor progress and implement actions needed to meet the energy efficiency targets set at COP28.

“The IEA is working more closely than ever with governments to ensure that energy efficiency remains central to secure, affordable, and inclusive energy transitions,” the report concluded. “Well-designed and effectively implemented policies will be essential to achieving these global goals.”

Topics: IEA

Sustainable bond issuance surges 9%, market set to hit $950bn by year-end: Moody’s

Sustainable bond issuance surges 9%, market set to hit $950bn by year-end: Moody’s
Updated 5 min 39 sec ago
Miguel Hadchity
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Sustainable bond issuance surges 9%, market set to hit $950bn by year-end: Moody’s

Sustainable bond issuance surges 9%, market set to hit $950bn by year-end: Moody’s
Updated 5 min 39 sec ago
Miguel Hadchity

RIYADH: Global issuance of sustainable bonds in the third quarter of 2024 reached $216 billion, marking a 9 percent annual increase, according to Moody’s.

The year-on-year increase in green, social, sustainability, and sustainability-linked bonds came despite a quarter-on-quarter drop, with the volume issued down 14 percent in the three months to the end of September compared to the preceding period.

For the first nine months of 2024, sustainable bond volumes reached $769 billion, marking a 3 percent decline compared to the same period last year.

Despite the quarterly dip, Moody’s expects total sustainable bond volumes to reach $950 billion in 2024 “buoyed by relatively robust volumes in the first half of the year and continued issuer appetite for funding environmental and social projects with labeled bonds.”

Of the $216 billion issued in the third quarter, green bonds made up the majority at $129 billion. In comparison, social bonds accounted for $37 billion, sustainability bonds for $41 billion, sustainability-linked bonds for $6 billion, and transition bonds for $3 billion. 

Green bonds remained the preferred choice for most issuers, comprising 60 percent of the third-quarter sustainable bond market and accounting for 59 percent of issuance so far this year. 

Although green bond issuance fell 18 percent from the previous quarter, Moody’s expected it will surpass its annual forecast: “Despite the decline in the third quarter, green bonds will likely eclipse our forecast of $580 billion given the strength of year-to-date issuance and continued issuer preference for the green label.”

Europe’s sustainable bond issuance faced notable pressure, dropping by 38 percent in the third quarter to around $80 billion, the largest regional decrease. 

While the continent maintained its position as the leading region in sustainable bond issuance, accounting for 37 percent of global volumes, this marked its lowest share since early 2020. 

The Asia-Pacific region showed resilience, with sustainable bond issuance totaling $60 billion, raising its global share to 28 percent — the region’s highest since the third quarter of 2023. 

North America’s sustainable bond market, however, remained subdued, with volumes of just $26 billion, marking its lowest level since the second quarter of 2020. 

Latin America and the Caribbean brought $12 billion to market, while the Middle East and Africa contributed nearly $5 billion, making up 8 percent of the total global sustainable bond.

Among sectors, nonfinancial companies led in sustainable bond issuance in the third quarter with a 28 percent share, or $60 billion, although this was a 26 percent drop from the previous quarter. 

Financial institutions followed, contributing $48 billion to the market, marking a 12 percent increase from the prior quarter and representing the second-largest share at 22 percent. 

Supranational issuers saw notable growth, issuing $33 billion, which represented a 51 percent increase quarter-over-quarter and an 80 percent rise year-over-year. 

Municipal issuance, on the other hand, declined 17 percent to $13 billion, the lowest since early 2022.

Sovereign and government agency issuance also saw quarter-over-quarter declines of approximately 30 percent.

Sustainable loan volumes experienced a more pronounced decrease, falling 34 percent year-to-date to $380 billion, following two years of strong growth. 

Sustainable loans averaged $127 billion per quarter over the first nine months, a notable drop from the quarterly averages of $201 billion in 2022 and $192 billion in 2023. 

The third-quarter volume of $101 billion was the lowest recorded since the first quarter of 2022. 

Sustainability-linked loans led the sector with $283 billion year-to-date, while green loans contributed $90 billion. In the third quarter alone, SLL volume stood at $71 billion, relatively flat from the previous quarter but down 35 percent year-over-year and 58 percent from the third quarter of 2022. 

Green loan volumes in the third quarter reached $27 billion, representing a 13 percent decrease from the previous quarter and a 54 percent year-over-year decline.

Moody’s highlighted that “while the decline in market share could be driven in part by some of the challenges issuers have faced amid heightened scrutiny around the quality of instruments and perceived greenwashing risks, there may also have been a greater number of unlabeled bonds this year as issuers have sought to quickly execute transactions when market conditions were favorable.”

European borrowers continued to dominate SLL volumes in the third quarter, holding a 42 percent share, with North American borrowers at 35 percent and Asia-Pacific borrowers at 18 percent.

“European SLL volumes declined by 22 percent to $30 billion in the third quarter, their lowest quarterly tally since the third quarter of 2021,” the report said.

The analysis highlighted the role of recent biodiversity and climate COPs in spotlighting the importance of closing financing gaps in the sustainable debt market. 

Biodiversity COP16 in Cali, Colombia, held at the beginning of November, emphasized mobilizing $200 billion annually for projects, including debt-for-nature swaps for high-debt nations. Though a small share of bond proceeds currently go to nature-related uses, Moody’s expected this to grow as more issuers fund biodiversity initiatives.

The upcoming climate change COP29 in Baku, Azerbaijan, due to be held from Nov. 11 to Nov. 22, is set to introduce a new finance target, replacing the current goal.

 “Establishing a new climate finance goal to replace the current $100 billion target will likely be a major topic of discussion at COP29. The aim of this new quantified goal is to support developing countries in their climate action plans beyond 2025,” said Moody’s.
 
Emerging markets, which face higher climate risks, may see increased sustainable bond issuance, especially as the “Climate Bonds Initiative’s expansion of its taxonomy in September to facilitate greater channeling of capital to adaptation and resilience projects,” according to the report.

Topics: green bonds sustainable bonds Moody's

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Jordan, Egypt discuss enhanced energy connectivity through Arab Gas Pipeline link 

Jordan, Egypt discuss enhanced energy connectivity through Arab Gas Pipeline link 
Updated 6 min 42 sec ago
Nour El-Shaeri 
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Jordan, Egypt discuss enhanced energy connectivity through Arab Gas Pipeline link 

Jordan, Egypt discuss enhanced energy connectivity through Arab Gas Pipeline link 
Updated 6 min 42 sec ago
Nour El-Shaeri 

RIYADH: Jordan and Egypt are taking steps to bolster regional gas connectivity as top energy officials from both nations met to explore potential infrastructure and supply partnerships.

The Middle Eastern country’s Minister of Energy and Mineral Resources, Saleh Al-Kharabsheh, and Cairo’s Minister of Petroleum and Mineral Resources, Karim Badawi, held talks on these issues on the sidelines of the ADIPEC 2024 conference in Abu Dhabi. 

A key focus of the discussions was the feasibility of linking Jordan’s Risha Gas Field to the Arab Gas Pipeline through a 300-km connection. 

This proposed expansion follows recent studies that identified commercially viable gas reserves in the Risha field. 

The Arab Gas Pipeline is a regional infrastructure project designed to transport natural gas from Egypt to Jordan, Syria, and Lebanon. Spanning over 1,200 km, the pipeline enhances connectivity and supports energy security across the Middle East. 

The talks also explored potential cooperation on gas-related projects, including initiatives to expand the use of natural gas in Jordanian and Egyptian vehicles, according to a statement released by Jordan’s Ministry of Energy and Mineral Resources. 

Both ministers agreed to set up technical meetings between Jordan’s Ministry of Energy and Mineral Resources and the Egyptian General Petroleum Co. to advance joint oil and gas exploration efforts within Jordan. These technical sessions are expected to facilitate knowledge-sharing and support the country’s ambitions in energy development. 

Additionally, the ministry’s statement highlighted a recent agreement signed between Egypt Gas Co. and Jordan’s Aqaba Development Co. 

This deal aims to supply natural gas to Quweira Industrial City in Aqaba. It includes provisions for constructing a natural gas pipeline network and establishing infrastructure in line with regulatory safety standards. 

At the event, Badawi also announced plans to introduce a policy paper focused on increasing investment in Egypt’s oil and gas sector.

The initiative seeks to attract investors across the oil, gas, refining, and petrochemical industries. 

The announcement followed Badawi’s meeting with TotalEnergies CEO Patrick Pouyanne, where the executive presented the company’s upcoming exploration and production activities.  

The two discussed TotalEnergies’ progress in boosting output at the Bashrush Gas Field, as well as its involvement in the Idku liquefaction plant and the firm’s expansion into jet fuel supply and marketing. 

Additionally, Pouyanne expressed interest in acquiring new exploration areas in the Mediterranean, aligning with the recent international bid round launched by the Egyptian Natural Gas Holding Co. for oil and gas exploration. 

Topics: Arab gas pipeline Jordan Egypt

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Riyadh Air plans new jet order decision early next year

Riyadh Air plans new jet order decision early next year
Updated 07 November 2024
Reuters
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Riyadh Air plans new jet order decision early next year

Riyadh Air plans new jet order decision early next year
Updated 07 November 2024
Reuters

LONDON: Saudi startup Riyadh Air is wading back into the jet market after buying dozens of Airbus and Boeing planes and aims to finalize a new deal involving the industry’s largest twin-aisle jets early next year, its CEO said.

The country’s newest national airline is weighing up the Boeing 777X and the Airbus A350-1000 and expects to make a decision in the first or second quarters of 2025, CEO Tony Douglas told Reuters.

Riyadh Air last year ordered 39 Boeing 787 wide-body jets with options for another 33 as part of a wider deal also involving national carrier Saudia, and last week it added a firm order for 60 Airbus A321neo-family aircraft.

Douglas declined to comment on the size of the new order but reiterated that the airline, which plans to start operations next year, ultimately aimed to operate more than 200 aircraft.

Douglas told Reuters in a separate interview last week that Riyadh Air would start formal talks for a new order for large wide-body aircraft within two months.

The roughly 200-seat A321neo is an in-demand single-aisle aircraft that competes with the larger versions of Boeing 737 MAX. Airbus says it is sold out through the rest of the decade.

Despite the long lead times for most new purchases, Douglas said the A321neos would be delivered between the second half of 2026 and the end of 2030 and hinted at further purchases.

“That puts us right back in the standard order window with Airbus so the door is wide open,” he said.

Industry sources said the aircraft had become available as part of a complex financing deal driven by the availability of future delivery slots originally assigned to Capital A unit AirAsia, which has been restructuring its order book.

Airbus declined to comment and AirAsia did not reply to a request for comment.

Douglas declined to comment on the deal’s structure, saying only that it was a “complex multi-party transaction.”

The growth of Riyadh Air, owned by Saudi Arabia’s Public Investment Fund, is one of the industry’s fastest launches.

Douglas said the A321neo would be used to open new routes or to fly in sectors where there is not enough demand to fill the 290-seat Boeing 787-9, adding that flying such big jets less than three-quarters full would not make sense economically.

Riyadh Air has not decided which version of A321neo to take but is likely to include some long-distance models, he added.

Topics: Riyadh Air Boeing Airbus

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Oil Updates – prices edge up as investors eye US election fallout

Oil Updates – prices edge up as investors eye US election fallout
Updated 07 November 2024
Reuters
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Oil Updates – prices edge up as investors eye US election fallout

Oil Updates – prices edge up as investors eye US election fallout
  • US dollar near four-month high as markets digest Trump win
  • China may face Iran crude squeeze if Trump ramps up sanctions
  • China’s October crude oil imports fall
Updated 07 November 2024
Reuters

SINGAPORE: Oil prices ticked up on Thursday following a sell-off triggered by the US presidential election, as risks to oil supply from a Trump presidency and a hurricane building in the Gulf Coast outweighed a stronger dollar and lower crude imports in top importer China.

Brent crude oil futures were up 29 cents, or 0.39 percent, at $75.21 per barrel by 10:00 a.m. Saudi time. US West Texas Intermediate crude gained 18 cents or 0.25 percent to $71.87.

Concerns around a Trump presidency squeezing oil supply from Iran and Venezuela as well as an approaching storm “more than offset the post-election impact of a stronger US dollar and ... higher-than-expected US inventories,” Tony Sycamore, a market analyst with IG, wrote in a note.

Trump’s election had initially triggered a sell-off that pushed oil prices down by more than $2 as the US dollar rose to its highest level since September 2022. But the front-month contracts pared losses to settle down 61 cents for Brent and 30 cents for WTI by the end of the Wednesday session.

“Historically, Trump’s policies have been pro-business, which likely supports overall economic growth and increases demand for fuel. However, any interference in the Fed’s easing policies could lead to further challenges for the oil market,” said Priyanka Sachdeva, senior market analyst at Phillip Nova.

“With the bumper surge in the dollar hovering at near 4-month highs, oil seems to be talking massive headwinds in the aftermath of the US election results.”

The upside to oil markets may be limited to the short to medium term as OPEC is expected to increase supply capacity in January, while historical trends do not suggest sanctions will prevent India and China from continuing to purchase oil from Russia or Iran, Sachdeva said.

Crude oil imports in China, the world’s largest crude importer, fell 9 percent in October, posting a sixth consecutive monthly year-on-year decline as a plant closure at a state oil refinery adds to weaker demand from independent refiners, data showed on Thursday.

Donald Trump is expected to reimpose his “maximum pressure policy” of sanctions on Iranian oil. That could cut supply by as much as 1 million barrels per day, according to an Energy Aspect estimate.

Trump in his first term had also put in place harsher sanctions on Venezuelan oil, measures that were briefly rolled back by the Biden administration but later reinstated.

In North America, Hurricane Rafael intensified into a category 3 hurricane on Wednesday, and about 17 percent of crude oil production or 304,418 barrels per day in the US Gulf of Mexico had been shut in response, the US Bureau of Safety and Environmental Enforcement said.

US crude inventories rose by 2.1 million barrels to 427.7 million barrels in the week ending on Nov. 1, the US Energy Information Administration said on Wednesday, compared with expectations for a 1.1 million-barrel rise.

Topics: oil updates oil prices

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