Category Archives: Latin America

How oil and gas producers can take advantage of the new energy environment in 2015?

For many years the discussion on climate change has been on the table. It is obvious that the earth’s climate is changing. The real question is, is it a natural behavior of our solar system or is it triggered by humans and the industry?

Physics tells us that energy cannot be created nor destroyed, it can only be transformed into various forms, such as heat (e.g. steam or hot water), electrical energy, gases (various hydrocarbons in gas or liquid forms). We see this clearly in the operation of nuclear power plants where the heat generated in the nuclear reactor is transformed into electrical energy.

Almost every transformation of energy will have undesired by-products or lost unusable energy forms. The challenge now is to reduce, or avoid, undesired by-products and energy forms. Politics urge the industry to reduce their emissions, particularly CO2 (Carbon-Dioxide, which should force the “Global-Warming”), and many other emissions (like SO2 (Sulphur-Oxide) and NOx (Nitrogen-Oxides) which also have an impact on our climate. The major complication is that these emissions don’t stop on national borders, they move across them, dependent on the weather system which exists at the time. A small difference is between local micro climate, which might be influenced locally only, by small emissions, and the larger influence of large emissions, which may have a regional or a global influence.

This means, in order to archive any success in protecting the earth’s climate, which is changing due to forced industrial emissions and the wasteful use of energy in homes or buildings, we need everybody to participate. This might be difficult to achieve right away, but to start with those which are already known as the biggest waste and emission producers could help significantly.  Having a 70% to 30% rule or an 80% to 20% rule is better than a 100% rule with no result at all.  Bringing ~7 billons humans under one umbrella is nearly impossible, not to mention the different industries at the same time.  This needs to happen gradually over a longer period of time; political rules and economics have to meet in an acceptable way.

As we all know, the primary energy form is oil or coal, but more and more electrical energy is coming from wind driven generators and solar panels.

To produce the equipment that is needed to transform wind or solar energy to electrical energy, will also use energy to be made and will produce unwanted waste. But the real questions are:

  • How long can these equipment’s be economically used?
  • What kind of waste will be produced after decommissioning?

Some other energy forms are also under development like “Hydrogen” (to produce hydrogen, is also energy intensive; you need electrical energy or a lot of heat, to transform other energy forms to hydrogen). It is clear, using “Hydrogen” as clean fuel, has a positive effect on the micro climate where it is used, but not on a larger scale, because of the amount of energy which has to be used to come to the energy form of “Hydrogen”.

The question here is:

  • Can “Hydrogen” be produced with low emissions that are less than the amount of emissions hydrogen creates when it is burned? It will produce nearly 100% water.

There is a large amount of research necessary to find technologies that make other energy forms usable without having a lot of undesired effects and wastes.

A good and feasible alternative could be the use of natural gas (Methane), which is available in many regions across the globe. But of course, there is also a lot of energy needed to get the natural gas out of the ground.

You have to drill and you may need compressors to operate to get the gas out of the grounds. And be sure the natural gas has some other gases, which are coming out of the ground with it (like H2S (Hydrogen-Sulfide), which needs to be removed and safely destroyed. In addition, to store natural gas under atmospheric conditions is not easy. There mainly two possibilities, (1) in a high compressed version and (2) in a liquefied version.

Using the high compressed version (several hundred bars) is used to supply cars, but the amount of gas which can be stored is still limited and it doesn’t matter if it is in the automobile or in the industrial environment. The distribution of high compressed gas is done by special trucks which can transport this form of gas and deliver it to the end user distribution terminals (some gas stations are already selling natural gas). The challenge for producers is to build more stations which sell natural gas. In the end, we need a dense network to make natural available to end users. The other challenge is for car makers since the distance you can drive with one load of compressed gas is not long enough for most users. For drivers in cities, it is already quite convenient with today’s cars. But driving long distances may still take a long time in regards to developments for both car makers and gas distributers.

One option is using natural gas to make electrical energy with gas turbines and attached generators, then using the waste heat for district heating. These combinations currently have an efficiency factor of ~61.7% and soon above ~62%. Gas turbines are very efficient to make electricity, but the current economic situation show that other primary energy forms are cheaper, so the option does not foster political desire.

Another option is using liquefied natural gas which is already utilized in the Oil & Gas industry, because it is the only form where natural gas can be stored and transported in large quantities. The disadvantage lies in the fact that natural gas needs to be cooled down to -162 °C to store it in a liquid form. Not to mention the cooling process also requires a certain amount of energy with another small amount of energy required to keep it cool.

In addition, to get the liquid natural gas back into a form of gas that can be used by end users it needs to be evaporated again. Again, this process will need some energy to make the natural gas available for commercial or industrial use.

But overall, “Natural Gas,” is the cleanest burning hydrocarbon gas of all, as it burns to water a lower amount of CO2. Natural gas can be produced, stored and transported in large quantities which is economically feasible. This should be the favored form for Oil & Gas companies.

Another possibility is the distribution and use of refinery produced gases like “Propane” and “Butane”. These kinds of gases have been used for decades now, but the widespread use has not really been seen.  There is also LPG (Liquefied Petrol Gas) which is offered at gas stations in many different countries and is used in vessels for cooking and many other applications.

LPG for cars is becoming more and more popular, due to the fact that it is much cheaper than gasoline or diesel. Due to the fact that is liquid under the conditions it is stored and sold, cars need to be modified to use it for the engine. Engines can burn only gasified products otherwise they wouldn’t work. 

With the all these options, it is clear that “Natural Gas” seems to be the future for Oil & Gas companies, as it has a positive impact on climate change and yet, is still economically feasible.

In conclusion, the “Full Energy Balance” for all kinds of energy forms and transformations needs to be achieved by oil and gas producers. This includes the investigation of all forms of losses and wastes or by-products, as well as a declaration to make the best and most economical form of energy, always in conjunction with the protection of our climate and, in general, our world.

What are the most important trends for the 2015 in the materials & natural resources industry?

The commodity super-cycle which began in the early part of the 2000’s is most definitely over. Signs of its demise were evident in 2013 and steadily falling commodity prices and mine closures since that time have confirmed it. Iron ore, coal and oil have been the most prominent minerals in terms of the decline in price and are certainly the most talked about, but few if any mineral commodities have been untouched. What does this mean for the mining industry in the year ahead?

The retreat of mineral commodity prices from their super-cycle peaks quickly saw the closure of high cost operations where lower grades, complex treatment routes and long logistics chains locked in a high cost base such that these operations could only ever be “swing producers”, viable only during peaks in commodity prices.

Not only did declining commodity prices see the natural elimination of high cost producers, it also brought about a change in the thinking of all resource companies. During the boom times, when skills and other resources were scarce and came at a premium, companies were prepared to pay just about anything or agree to any terms just to ensure that output and revenue were maximised, with perhaps only a cursory thought for margin. The end of the super-cycle has seen a complete turnaround in thinking. Many skilled professionals now find themselves without work and those that are still employed are happy just to have a job. Not surprisingly salaries have declined. The focus of the industry over the past 12 to 18 months has been on cost-cutting and this is perhaps where early opportunities have been missed and where focus will be placed during the course of the coming year.

Cutting costs is easy, and is the normal knee-jerk reaction of almost all businesses. What appears to come less instinctively, at least in the mining sector, is the search for productivity improvements. A notable exception is perhaps Rio Tinto’s “Mine of the Future”, although I believe that this was driven by scarcity and cost of resources at the peak of the boom, rather than a search for improved productivity per-se.

Whilst perhaps it should have been their initial focus, those companies still operating are now being forced to look for improvements in productivity and I believe that this will be a major trend during 2015.

Every operator will be asking themselves whether there is a way to operate that would increase output using the currently available resources and thereby reduce unit costs. The decision that each will then have to make is whether to maintain output at the increased level and risk oversupply, further reducing prices, or whether reducing output, laying off more personnel and idling some equipment may result in a better outcome for the business. My 35 years of experience in the industry inclines me to think that most, if not all, will choose the former and argue that it is natural selection at work ensuring that only the fittest survive.

With falling commodity prices has come a capital strike, where even projects with seemingly robust economics are finding it difficult to gain funding. Those that have found finance have often had to surrender a significant portion of the project or company to the financier.

At the small cap end of the market, funds appear to have dried up almost completely with companies struggling to raise even $1m to $2m from their existing shareholders via share purchase plans. This has some significant long-term implications because it is often the small exploration companies that make the discoveries which lead to future operations.

It is an old adage that capital always needs to find a home and whilst there are rumours circulating that there are investors with funds ready to be placed in the resources sector, it appears to be something of a stand-off, with no one wanting to blink first and make an investment.

The gold sector may perhaps provide a beacon of hope for the industry and act as a trigger for investment of these funds. Whilst the gold price is well off its 2012 peak of US$1901 /oz it does appear to have stabilised in the range US$1250 to US$1300 /oz. More importantly, for those producer countries whose currency has devalued against the US dollar, prices in local currency are, in some cases, approaching previous all-time highs. Reductions in the cost of labour and the cost of energy mean that these operations could offer attractive margins and therefore good returns for investors.

So to summarise, in my view, 2015 will see the industry focus on productivity, most likely with a greater focus on mechanisation and automation and an easing of the tight capital markets with early investments being made in the gold sector.

What are the top 3 trends that will shape globally the aerospace and defense industry in the coming year?

The Aerospace Industry has faced huge challenges on a worldwide level mainly due to economic and environment pressure changes. This scenario is creating some new trends and opening opportunities to the main Players to search for innovations and development of new technologies.

One of these trends is the Carbon emission reduction for the entire aircraft production chain, specially for the engine design. This policy was set by IATA (International Air Transport Association) which has recently established a new index of Carbon reduction for Aerospace Industry and drives fuel efficiency improvement in 1,5% per year until 2020.

In this way some aviation companies have already been looking for alternative fuels (“green fuels”) to replace the current aviation kerosene. This allows the dependency reduction of the fossil fuel which has also high volatility due to oil price. Among Bio-fuels it is possible to highlight the biokerosene extracted from sugar cane. This new fuel has already been tested on an experimental flight in the EMBRAER E195 aircraft from Azul Airlines in July 2012 in Brazil using a fuel mixture of 50% biokerosene and 50% aviation kerosene. This preliminary test revealed that by filling jets with biokerosene might be able to reduce up to 80% carbon emissions in the atmosphere.

Another trend of Aerospace segment is to develop innovative processes so as to mitigate failure risk. Large investment on incorrect technologies in a highly competitive industry can impact the financials and profit of the companies. For example, the automation (or even robotization!) of big parts of the aircraft, like fuselage, wing or command surfaces that requires a complex structural assembly, brings a substantial gain and savings to the business. On this route, it was recently announced by GKN Aerospace, in partnership with Bombardier, a successful try-out of an automated manufacturing process of the wing box assembly, which according to them should reduce the current time cycle assembly up to 30%. It is worth mentioning this technology has been developed to fit different structural assemblies (hybrid) what would also generate savings in the tooling manufacturing.

The global market has also signaled to the growth of LCC (Low Cost Carrier) airlines specially driven by the emerging markets, such as Asia, Latin America, Middle East and lesser extent Africa, due to the rising economic power of these regions. This growth has generated greater competition between the airline companies challenging the business and its profitability. So the industry is faced with the challenge to make more efficient airplanes, loaded with new technologies and less cost and maintenance time than the current ones.

Thus, the Aerospace industry as a whole has been moving towards not only to maintain its constant evolution, but also to reinvent itself. Surely soon we will be surprised with others technological innovations that will be created from this fantastic industry!

What are the 2014 global SaaS trends that will shape the industry?

Cloud Market Overview for 2014

2014 is set to be a stellar year for Cloud Computing in general and SaaS in particular. An estimated 70% of SaaS customers are from “Small to Medium Businesses” with 80% of Enterprises still concerned with the Risk issues of both Security & Compliance. With 2013 being hailed as the “Year of the Internet Breaches” where everyone from Amazon to Ebay, Facebook and Forbes, IRS to Target being hacked and literally hundreds of millions of customer data being compromised, it’s no wonder “Steve Wozniak” in his now famous 2012 statement, in respect to the public cloud saw “…horrible problems…” with the cloud due primarily to the blatant lies in marketing which claim the cloud is “safer than your own private enterprise infrastructure”, an actual claim on numerous websites and in interviews by executives at Amazon, Google and other major Public Cloud companies which, in my opinion (just like Steve said) has definitely harmed the whole cloud market from a trust perspective. As executives become more educated about the realities of cloud computing and the public cloud in particular, they realize those kinds of statements are far from the truth it, and it has left a bad taste in many executives mouths for the public cloud, which I’ve experienced first hand. What it has done is made enterprise executives who see these blatant lies for what they are, much more cautious which, in the long run is a good thing since, I believe, they should take time and not jump into the public cloud without careful consideration, a lot of planning and a complete & unbiased third party risk assessment.

So, although cloud sales are steadily increasing, with total Global Cloud spending expected to reach $75B-$100B globally (depending on which analyst you speak to) in 2014, I believe the frequent and highly publicized breaches have hurt the market and so, look for a slow-down in the SaaS market overall, as companies take stock to address the security and compliance concerns before they stick their big toe into the swamp that has become the cloud market, to “test the waters” so to speak.

SaaS Service Management

According to new research by Enterprise Management Associates (EMA), most IT organizations have limited visibility into the usage and cost of public SaaS applications. I believe in 2014 you will see more organizations seeking solutions to this problem and for that reason I see the “SaaS management” market as one to keep an eye on in 2014. Both new startups and existing “SaaS Management” businesses should see an increase in sales over the next few years and you should also see a market consolidation with the best players acquiring or putting out of business the lesser product/service vendors.

Security & Compliance

Security & Compliance will be the real winner in 2014. Again with 2013 being named the “Year of the Security Breaches” and hundreds of millions of private data being compromised at mainstream websites, look for SaaS Enterprise growth to slow down even more while start-ups race to secure market share of this massive new “Public Cloud Security & Compliance” emerging market.

Currently an estimated 80% of Enterprises fear to enter the Public SaaS market (according to multiple surveys), and for good reason as the risks have been shown to be astronomical indeed. As new software, hardware and services begin to appear to address these concerns such as the new CSPComply service by Compass Solutions, LLC of Washington DC and others, we should begin to see an uptick in SaaS adoption starting to appear, however I would not hold my breath for that to occur in 2014, look for this increase to be more pronounced in 2016 and beyond.

Medical-Device Technology

Another emerging market which is expected to be massive indeed is the so-called medical-device market. Products such as the FitBit Flex wrist band and FitBit Aria wireless scale seem to motivate people to reduce weight and exercise more, as studies are beginning to show us. Currently there are socks, ankle bracelets and even sneakers which all work together as a unit with embedded sensor technology to show your heat dispersion pattern on your feet, how many miles you’ve walked, your average rate of speed, how many calories you’ve burned, your heart-rate and other data including your travel patterns.

Many of these devices utilize a SaaS infrastructure, which along with additional factors will lead to more “service” oriented SaaS business models being developed in 2014 and through the next few years, with the Medical-Device Market being a major influence.

“Hyperconverged Network Paradigm”

As technologies such as the next wave in wireless 802.11ac begin to take hold bandwidth in the first-wave 80MHz products will deliver throughout from 433 megabits per second on the low end to a maximum of 1.3 gigabits per second at the physical layer & more dense modulation schemes of up to up to 256 quadrature amplitude modulation (QAM), compared to 802.11n’s 64 QAM, for a 33 percent improvement. The new protocol doubles multiple input, multiple output (MIMO) capabilities. The increase moves from 802.11n’s four spatial streams to eight streams. For users, this means a speed boost, greater up-link reliability and opportunities for improved down-link reliability as well. For the internet this means massive increased bandwidth issues which, was why the IPv6 Protocol was developed in the first place…Look for IPv6 to also be a big winner in 2014 and beyond as more and more ISP’s, Backbone Providers and Telco’s begin migrating over from IPv4 do to the massive increase in bandwidth demands in 2014 and beyond.

  •  A growing number of manufacturers are already shipping first-wave 802.11ac products for consumers and plan to expand offerings for business and enterprise network environments in the coming year. A Second Wave in Performance Speed and efficiency will ramp up even higher when Wave 2 devices for 802.11ac arrive. They’ll offer additional improvements in channel bonding by handling up to 160MHz, along with support for four spatial streams. These capabilities will help second-wave devices achieve throughput of around 3.47Gbps. (Source Cisco)
  • Worldwide smartphone shipments grew 40%, to more than 1 billion units, in 2013 and are on pace to reach 1.7 billion units by 2017.  (Source: CDW)
  • In 2014 we will see an increase of both “Smart” mobile devices, increased access to unlimited storage space on these devices via the emerging free and subscription cloud storage, and a “Quadrupling” increase in bandwidth beginning as 802.11ac takes hold, and most important of all the majority of the mobile carriers will finish large portions of their 4G/LTE infrastructure upgrades over the next three years starting with some pretty large expansions this year which most analysts seem to ignore or forget even though this will be by far the largest contributor to the “hyperconverged” market, as wherever these increased bandwidths occur, increases in sales of “smart”, “handheld” mobile device sales increased dramatically. Look for all of these emerging technologies to trigger a number of unique situations as well as opportunities and even new markets. This type of increased traffic has never been experienced before and my prediction is it will cause many problems with unprepared SaaS infrastructure capacity which you should be prepared for in 2014. However, even more important will be the emergence of the “Hyperconverged” network, the increased importance of the end-point device within the Enterprise market and the increased importance of the emerging “Bring Your Own Device” & “Bring Your Own Technology” (BYOD/BYOT) market and the management of as well as the security & compliance issues associated with it. Look for these emerging technologies and markets to become major influencers receiving large boosts in both Capital investiture as we as large sources of new ideas and SaaS solutions to address the issues which will be created by this new paradigm.

“However the reality is that all of these devices as they begin to communicate back to the cloud will begin to seriously erode the bandwidth capabilities of the current infrastructure, so look for startups with unique ideas of mitigating this increase in traffic to play a niche yet exciting and influential role as the “idea” people and “Think-Tanks”  & “Brain-Trusts” such as the new “Synapse Synergy Group” begin to come into their own in 2014 and beyond” – Quote by Jarrett Neil Ridlinghafer

 Market Consolidation

Finally, we should see a lot more consolidation of the SaaS market with the winners and losers become clearer in 2014. Look for Amazon to steam ahead and broaden their lead, Salesforce will continue to be strong although they are already looking for ways to broaden their market as their primary business slows down, Microsoft will attempt to reinvent themselves in the Cloud with their new CEO at the helm and Oracle and IBM should begin to capture more market share as both of their new services start to take hold. As for VMware it still seems a bit too early to say one way or another. They did not come out with a big splash and a few Billion Dollars to throw around like IBM and they actually do very little marketing, which makes one wonder, are they really ready or did they jump early in order to stop their slide to cloud obscurity, or are they so confident they just don’t need to advertise their cloud offering? They obviously have a massive private cloud and enterprise infrastructure base from which to draw on, so one would hope with their vendor specific offering, that all those VMware Enterprise infrastructures will pay off as Hybrid becomes a much larger player over the next 3-5 years in the Enterprise.

What are the key trends in global mHealth industry and which of its segments will be the key growth drivers over the next 12 months?

  1. Monitoring services (up to 66% of the Global mHealth market share)
  • Remote Patient monitoring
      • (e.g. Obesity Management
      • Healthy Living
      • Pregnancy Tips
      • Elderly Care
      • Smoking De-addiction
      • Infectious Diseases
      • Reproductive Health
      • Child Health / Child Care…)
  • Video conferencing and online consultations
          • e.g. Telephone-based consultations
          • Video consultations
          • Text-based consultations…
  • Personal healthcare devices
  • Wireless access to patient records and prescriptions
  • Chronic disease managementIndependent ageing applications in developed markets 
  • Post acute care monitoring services
  • Monitoring of patients with metabolic conditions such as obesity and Diabetes (is expected to comprise about 40% of the chronic disease management Segment)
  • Monitoring patients with cardiovascular conditions such as hypertension, coronary artery disease and congestive heart failure (is expected to contribute about 45% to chronic disease management revenues in the US and about 80% in China).
  • Analysis of general health and wellness data gathered by mobile devices

 2. Diagnostic Services (up to 16% of the Global mHealth market share)

  • Interactive messages that help patients self-diagnose minor ailments
  • Medical call centres / help-lines manned by healthcare professionals
  • Telemedicine solutions that enable doctors to ‘see’ patients through wireless broadband
  • A majority of the revenues from Diagnosis services are expected to come from call-centre and mobile telemedicine solutions.              
  • The adoption of Diagnosis services is expected to support developing markets in bridging their healthcare access challenges.

 3. Treatment Services (up to 11% of the Global mHealth market share)

  • Emergency Response
  • Ambulance based Solutions
  • Treatment Compliance
  • Appointment Reminders
  • Use of mobile device to explain/demonstrate during office visits
  • Provide patients access to portions of their medical record
  • Drug adherence and other health-related communication

 4. Healthcare System strengthening Services (up to 7% of the Global mHealth market share)

  • Patient-centred care
  • Wellness (up to 3% of the Global mHealth market share)
  • Prevention (up to 1% of the Global mHealth market share)
      • e.g. Drug Abuse Prevention
  • Information Lookup and Decision Support
  • Health Surveys & Healthcare Surveillance
  • Healthcare Practitioner Support
  • Healthcare Administration& administrative communication

The Market and Public Policy Environment for Card, Internet and Mobile Payments in Europe

1- A difficult political and economic environment

The attention being paid to the Card payments market by the European Commission and national competition authorities, whose aim is to act increasingly and strongly to disrupt the status quo, is one of the major factors contributing to the changes the payments industry is going through. Continue reading

The Paucity Problem: Wastewater Treatment in Mexico

The construction of the world’s largest waste water treatment facility in the state of Hidalgo is not a mirage in the Mexican desert. After three years of preparation, the plant is finally set to quench the region’s needs for sanitary solutions in the face of alarming water shortages. Large investors including the world’s richest man, Carlos Slim, participated in the creation of the new plant.1

Mexico is not alone in its struggles for obtaining water resources, indicating that it might very well be a pioneer in the growing necessity to treat wastewater. Continue reading

Mexico on the Rise – Here to Stay or More of the Same Instability?

Mexico’s economy is booming, despite loud concerns that returning power to the traditional Institutional Revolutionary Party (PRI) would mean a return to a despotic cronyism.  It is the second largest export market and has a flourishing network of trade internationally. The incessant drug war is also seeing somewhat more peaceful days. However, corruption, poverty, crime and meager public services continue to weigh the country down as a credible player on the world stage.

Will Mexico rise as a solid and even leading neighbor to the United States and Latin American countries – or will this be a short-termed prosperity that will again be swindled away as it was during the previous 100 years under the (PRI) Party? Continue reading

Chocolate: The Recession-Proof Good

When looking at the global chocolate market, one could comment that it is a recession-proof commerce. Despite the troubled state of the global economy, the market for chocolate is still growing steadily, leading to the conclusion that chocolate is a small, affordable luxury which people still choose to indulge in.

The global chocolate market is dominated by five large multinationals Continue reading

The Cost of Cures

With modern technology and science’s ever increasing knowledge, we have seen huge leaps in the development of the world’s medical care and health systems. However, the cure for cancer has always mystified scientists and has seemed like it would never leave the realms of science fiction. Until now, that is thanks to two Swedish researchers who could be round the corner from a revolution that could change our lives forever after engineering a virus that attacks cancer.[1] Continue reading