African countries that will most likely benefit from investment in 2014 are: Country Resource
Namibia/South Africa
Uranium
Burkina Faso,
Ghana, Guinea, South Africa
Gold
DRC, Zambia
Copper / Cobalt
Iron Ore / Magnetite
Cameroon, Guinea, Mauritania, Mozambique, Sierra Leone
Coal (Thermal and Coking)
Botswana (Thermal), Mozambique (Coking), South Africa (Thermal)
Source: KPMG Metals
It is forecast that from 2010 to 2050, annual steel, iron ore and coal consumption will increase by 59.4%, 47.1% and 129.9%, respectively. With the continued expected growth in China’s demand for urbanisation, Africa with its abundance of natural resources will be at the top of most Asian investor wish lists.
Gas from Israel’s Leviathan will start by being exported to the Palestinian authority. A $1.2 billion contract between the Leviathan partners (Noble Energy, Delek Group and Ratio Oil Exploration) and the Palestine Power Generation Company was just signed for the export of 4.75 billion cubic meters of gas over 20 years.
The deal is the first of its kind to be signed by the Leviathan partners. The Leviathan natural gas field is the biggest discovery made so far off the shores of Israel and the largest exploration success in Noble Energy’s history. It is located 130 kilometers west of Haifa, has a gross mean resources of 18 Tcf of natural gas and is operated by Noble with a 39.66% working interest. Natural gas was originally expected to begin flowing from the Leviathan by 2016 but the field is now expected to come online by 2017.
Another major gas field offshore Israel is the Tamar gas field also operated by Noble Energy. The Tamar field has a gross mean resources of 10 Tcf of natural gas. It began supplying the domestic Israeli market in March 2013.
The deal between the Leviathan partners and the Palestinian authority comes after months of uncertainty regarding Israel’s export strategy and export markets. Speculations on whether Israel will opt for exports or reserve its natural gas for domestic use were ended when the Supreme Court rejected on 21 October 2013 a petition against a June cabinet decision to export approximately 40% of the gas found offshore Israel.
The June decision also incorporated another important precision, that exports to immediate neighbors - including the Kingdom of Jordan and the Palestinian authority - would be booked as sales: ie they would come out of the export quota rather than reduce the amounts reserved for national consumption.
The Leviathan partners believe that the deal will pave the way for future Leviathan gas deal with other consumers. Neighboring Jordan, who like Israel has a history of reliance on Egyptian natural gas, also suffered from the disruption in the flow of the gas from Egypt to Jordan in the aftermath of the revolution that toppled President Mubarak. Also Egypt is still supplying Jordan with reduced amounts of gas, the Hashemite Kingdom is currently undergoing a major energy crisis. Jordan was forced to import expensive fuel products which caused a spike in its energy bill and in electricity prices. Jordan has been rumored to be considering important gas from Israel.
Egypt, despite its domestic production of natural gas, is also suffering from domestic shortfalls due to export obligations and a growing domestic demand. Egypt and Israel have recently discussed the possibility of entering a new gas deal. The deal would this time stipulate that gas will flow in the opposite direction: from Israel to Egypt rather than the opposite.
A long national debate divided Israel between those who believed that natural gas exports were essential for Israel to pursue further gas explorations and generate substantial revenues and those who were firm in their belief that Israel should save all the natural gas for the consumption of its future generations for decades to come. Discussions also revolved around the various scenarios that Israel could consider to export its gas: the pipeline, the LNG and the floating LNG options. The recent rumor that Israel will start by exporting to immediate neighbors before exploring ways to reach further markets was just confirmed by the Israeli-Palestinian deal.
The Australian giant Woodside was hoping to acquire a 30% share in the Leviathan and inject its LNG expertise to export the gas from the Leviathan to East Asian consumers as liquefied natural gas. The likelihood of Israel opting for LNG is decreasing by the day as Israel seems to be more inclined towards using a pipeline to transport natural gas to regional customers including Turkey.
Neighboring Cyprus also has the ambition of attracting Israeli gas to its onshore LNG facility in the coastal area of Vasiliko. Such a collaboration would enhance the island’s chances of materializing its ambition of becoming a regional energy hub and would justify the multi-billion dollar project. So far, there is no indication that Israel will opt for this option.
Karen Ayat is an analyst focused on energy geopolitics in the Eastern Mediterranean. Email Karen on ayat_karen@hotmail.com. Follow her on Twitter: @karenayat
#Gold – Swiss central banks reports £10.1bn loss in value of total asset holdings
The loss is thought to be principally led by a 28% fall in the gold price last year.
Switzerland's asset writedown was offset by gains made on its foreign currency holdings
What press reports don't mention are the huge gains made in previous years by the Swiss central banks as gold prices recovered from a low of $250/oz known as the 'Brown Bottom' after the sale of UK gold by the then Chancellor Gordon Brown.
Central banks may struggle to maintain steady asset values in volatile markets but are not likely to offload gold holdings due to the potential for greater volatility in paper currencies going forward
