NEFTE Compass articles from August 2007

NEFTE Compass archives from August 2007

Rosneft Rings The Changes On Exports.
August 1, 2007... Rosneft is introducing revolutionary changes to its export operations to cope with its increased oil output after it became Russia's biggest oil producer and refiner by gobbling up most of Yukos. Critically, the state-controlled giant is...

Kazakhs Get Tough Over Kashagan Delays.
August 1, 2007... More trouble is brewing for the Eni-led consortium developing Kazakhstan's giant offshore Kashagan field after the government warned it may revise the terms of the production sharing agreement (PSA) as a result of the repeated delays in getting...

Black Sea Ports Face Heavy Cuts.
August 1, 2007... Moscow has solidified a broad cutback in crude exports from outlets spread around the Black Sea in August, while holding shipments from the Baltic Sea nearly level, resulting in a sharp drop in total seaborne exports (see p6). Russian...

Baltic Pipe To Have Two Endpoints.(Brief article)
August 1, 2007... The idea of sending some of the crude volumes from the planned Baltic Pipeline System-2 (BPS-2) to Ust-Luga as well as to Primorsk has found another supporter in Russian Transportation Minister Igor Livitin, who has written to President...

Gazprom To Cut 2007 Investment.
August 1, 2007... Russia's Gazprom plans to cut its 2007 investment program by 11%, according to a eurobond prospectus issued by the company last week. The cuts cover spending on several of Gazprom's big upstream projects, including the huge Arctic Shtokman gas...

TNK-BP To Sell Mature Units.
August 1, 2007... TNK-BP announced plans last week to sell some of its mature units and to acquire new ones in Russia's southern Urals Orenburg region as part of the company's restructuring program. The company is considering selling its local producing...

Integra Inks Rig Deal With Rosneft.
August 1, 2007... Russian oil-field services company Integra's manufacturing subsidiary has signed a contract with Rosneft's drilling arm to deliver four heavy drilling rigs in 2008 and received the right to provide three more rigs in 2009-10 pending further...

TNK-BP Announces Huge New Rig Tender.
August 1, 2007... Russian-UK joint venture TNK-BP has announced a tender for the long-term supply of drilling services, including up to 60 dedicated drilling rigs, the total value of which could exceed $2 billion, as it expands into East Siberia and West Siberia...

Pipeline Companies Receive Valuations.
August 1, 2007... Russia has tentatively appraised the value of state products pipeline monopoly Transnefteproduct at slightly under 55 billion rubles ($2.15 billion), or about 15% of the value of crude oil pipeline monopoly Transneft, for the purpose of the two...

Refining Runs Up As Tax Hits, Demand Rises.(Brief article)
August 1, 2007... Crude processing at Russia's refineries increased to over 111.4 million metric tons (4.512 million b/d) in the first half of 2007, up by 5.2% from the same period last year (see p11). Total throughput stood at almost 18.7 million tons...

Rosneft-CNPC JV Wins Licenses In Siberia.
August 1, 2007... Vostok Energy, a joint venture between Rosneft and China National Petroleum Corp. (CNPC), has won its first licenses to develop oil and gas reserves in Russia. In a tender this week, the joint venture won the right to develop the...

No Plot Behind Lukoil's Management Reshuffle.
August 1, 2007... Four Lukoil vice presidents in charge of key areas of the company's operations -- including exports, finance, geological exploration and gas production -- resigned last week. The company explained that the four men had reached retirement age....

Russneft To Elect New President.
August 1, 2007... Russneft's board of directors this week approved the resignation of its founder and president Mikhail Gutseriev, the company said in a statement. The oil independent also confirmed that affiliates of Basic Element -- owned by aluminum magnate...

More Environmental Problems At Sakhalin-2.
August 1, 2007... The Sakhalin-2 LNG and crude project offshore Russia's Pacific coast has again come under fire from Moscow, this time from both Russia's regional technical compliance and safety board and an environmental agency, over alleged technical...

Baltic Petroleum Gives Up Two Licenses.
August 1, 2007... UK-listed Baltic Petroleum has denied that the Russian government has revoked some of its Siberian exploration licenses, saying it willingly returned the licenses to the state because it had little interest in pursuing them. Baltic...

West Siberian Plans Reserves Increase.(West Siberian Resources)(Brief article)
August 1, 2007... Russia-focused independent West Siberian Resources expects that independent auditor DeGolyer and MacNaughton (D&M) will upgrade reserves by as much as 20% at several of its key Timan-Pechora region oil fields in November, after drilling found...

Russian Sintez Looks To Indonesia.
August 1, 2007... Russia's Sintez is looking into opportunities to purchase Indonesian oil and gas exploration and production licenses, according to a statement from the private company. Indonesia's ministries of energy and natural resources as well as...

Talks Planned On Turkmen-Pakistan Pipe.
August 1, 2007... The steering committee of the Turkmenistan-Afghanistan-Pakistan gas pipeline project will meet in Islamabad Aug. 22-23. India, which has indicated it would like to join the project, has also been invited to attend the meeting. A draft...

Klaipeda Demands Higher Tariffs For MN Exports.
August 1, 2007... Klaipedos Nafta (KN), the state-controlled operator of Lithuania's Baltic Sea Klaipeda oil products export terminal, wants to revise upward preferential transshipment tariffs for exports by Lithuania's Mazeikiu Nafta (MN) refinery. KN's...

Russia Cuts Gas Flows To Belarus.
August 1, 2007... Gazprom will cut natural gas supplies to Belarus consumers by 45% from Aug. 3, but the Russian gas giant hopes to maintain full supplies to Europe that transit its neighbor. The two sides find themselves at the edge of another energy crisis...

Fluor Wins Gdansk Refinery Upgrade Work.
August 1, 2007... US-based Fluor Corp. has won a contract to provide engineering, procurement and construction management services for an upgrade project at the Gdansk refinery owned by Grupa Lotos, Poland's second largest oil refiner and retailer. "This...

Global Credit Turmoil Hits Russia's Funding Options.
August 1, 2007... With global credit markets in turmoil, Russia's leading oil firms may be forced to put their borrowings on hold for several months, as investors are currently showing little appetite for the risk of Russian debt offerings. As US markets...

Equities and Currencies.
August 1, 2007... Share Prices Closing On Jul. 31, 2007

Urals Strong, Futures Gains Hit By Profit-taking Sell-Off.
August 1, 2007... Front-month Brent crude oil futures traded in a relatively modest $2.95/bbl range from a Jul. 25 low of $74.23 to a Jul. 31 high of $77.18 -- largely in anticipation of bullish US inventory figures, but eventually bearish product figures...

Gas Oil, Fuel Oil Supported by Good Demand.
August 1, 2007... European product prices rebounded on the back of crude strength and rising demand, both for gas oil and high-sulfur fuel oil. ICE gas oil August futures mirrored their previous closing high for the year on Jul. 31, settling at...

Lukoil Eyes Possible Cuban Refining Move.
August 8, 2007... Russia's biggest private oil firm, Lukoil,, is looking at crude processing facilities in Cuba to help it reach a target of doubling its refining capacity to 2 million barrels per day within a decade. The plan could include either an upgrade of...

Baltic States In For Foggy Autumn.
August 8, 2007... Products traders operating in the Baltics could be in for an interesting few months, as a series of changes in the region's needs and supply capabilities are set to disrupt established shipping patterns. Alongside persisting problems with...

Russian President Sets Out Tasks.
August 8, 2007... Outlining the main tasks for the Russian oil and gas industry, President Vladimir Putin called this week for a reduction in gas flaring, an increase in refining depth and the creation of clear and transparent rules for access by foreign...

Kremlin Prioritizes Domestic Gas Markets.
August 8, 2007... The Russian Authorized State Body (ASB) overseeing the Exxon Mobil-led Sakhalin-1 production sharing agreement (PSA) has "recommended" that investors in the Pacific offshore development -- Exxon Mobil, Rosneft, India's Oil and Natural Gas...

Seaborne Crude Exports Jump, Druzhba Dips.
August 8, 2007... As global crude prices continued to push upward, Russian oil firms pushed more crude abroad in July, boosting exports of Russian oil by more than 100,000 b/d from the previous month. Russian exports outside of the former Soviet Union reached...

Rosneft Purchases More Yukos Assets.
August 8, 2007... State Rosneft has won the auction for the 18th lot in the Yukos liquidation auctions for 18.58 billion rubles ($730 million). Rosneft said that CJSC Yukos-Transservice, East Asia Transit and assets in Rosneft's oil producing enterprises were...

EBRD Withdraws From Sakhalin-2.(European Bank for Reconstruction and Development)(OAO Gazprom)(Brief article)
August 8, 2007... The European Bank for Reconstruction and Development (EBRD) has ended talks on a possible loan to the Gazprom-led Sakhalin-2 project offshore Russia's Pacific coast, citing Gazprom's need for a decision this autumn. Gazprom needs a...

Tomskneft Owner's Identity Remains Unclear.
August 8, 2007... The identity of the owner of a 50% stake in former Yukos producing subsidiary Tomskneft that Rosneft recently sold remains a mystery. Rosneft President Sergei Bogdanchikov has just confirmed to the governor of the Tomsk region, Viktor...

Russian Commodities Exchange Details Revealed.
August 8, 2007... More details of the planned St. Petersburg commodities exchange, which Russia aims to launch by the end of the year, became available last week. According to Russia's deputy minister for economic development and trade, Kirill Androsov,...

Sintez Offers Gazprom Barents Sea Licenses.
August 8, 2007... cRussian independent Sintez has offered Gazprom a controlling stake in Sintezneftegas, which owns exploration licenses to two highly prospective Barents Sea blocks, as it seeks to hold on to its investment. Sintez Director-General Yuri...

Surgut Reshuffles Shareholder Structure.
August 8, 2007... Surgutneftegas executives have taken further steps to hide the Russian oil company's real shareholding structure, according to Russian media reports. Surgut Chief Executive Vladimir Bogdanov has transferred his own management positions in...

Russia Taking Arctic Bid To UN.(Brief article)
August 8, 2007... Moscow hopes that its symbolic claim to a vast swath of the energy-rich Arctic will translate into real holdings, as Russian officials announced this week that they plan to go to the UN in 2009 or 2010 to ask that waters stretching up to the...

Japan's Chubu Formalizes Sakhalin LNG Deal.
August 8, 2007... Japan's Chubu Electric Power has finally joined the list of LNG buyers from the Sakhalin-2 LNG and crude project offshore Russia's Far East Pacific coast. Sakhalin Energy -- the consortium led by Gazprom and Royal Dutch Shell that is...

Novatek Buys Into Three Licenses.(United Capital Partners)(Brief article)
August 8, 2007... Independent Russian gas producer Novatek has acquired stakes in three companies holding six exploration licenses in the West Siberian Yamal Nenets Autonomous region from United Capital Partners. Novatek acquired a 25% stake in...

TNK-BP Consolidates Assets Amid Restructuring.
August 8, 2007... TNK-BP has offered to buy out minority shareholders in its Russian upstream subsidiaries as part of the company's ongoing restructuring program. The Russian-UK joint venture has offered minority holders of common and preferred shares in...

Russia, Kazakhstan Gas Flaring Rises.(Brief article)
August 8, 2007... It's no surprise that Russia flares more natural gas than any other country (NC Jan.11,p5). However, a study based on more than a decade's satellite images finds that Kazakhstan also flared far more than it officially reported. Earth...

Shell Joins Queue Knocking On Turkmenistan's Door.
August 8, 2007... Turkmenistan is starting to get crowded. Royal Dutch Shell has joined the growing list of oil and gas companies visiting Ashkhabad to register their interest as the Central Asian country continues to open up following the election of a new...

Turkey Lays Transit Doubts To Rest.(Brief article)
August 8, 2007... Azerbaijan's doubts about Turkey's willingness to act as a transit country for gas owned by others should be laid to rest by the trilateral agreement signed by Italy, Greece and Turkey late last month backing the transport of Caspian and...

Production From Tengiz Recovers In July.
August 8, 2007... The Tengizchevroil joint venture that is developing Kazakhstan's Tengiz oil field boosted production by 74,000 b/d in July to 272,000 b/d. Project-operator Chevron continues to move ahead with the initial stages of testing for the Sour Gas...

Turkmens Set Up China Gas Supply Council.
August 8, 2007... Turkmen President Gurbanguly Berdimuhammedov has set up a special council to overview the implementation of a gas supply plan to China. The plan includes construction of a pipeline through Kazakhstan and Uzbekistan that would pump up to 30...

Victoria Drills Duster In Kazakhstan.
August 8, 2007... London-listed Victoria Oil and Gas share prices slid almost 6% after drilling at well 72 on the western section of the Kazakh Kemerkol fields failed to show commercial quantities of oil. Victoria had high hopes for the well following...

Russia And Belarus Resolve Gas Spat.
August 8, 2007... Belarus' state pipeline company, Beltransgas, has paid the remaining money owed to Gazprom, the Russian state gas company said Aug. 8. The payment averted a cut in deliveries to Belarus and possible supply disruptions to Europe. A deadline...

Blast Cuts Russian Gas Flows To Greece.
August 8, 2007... Russian natural gas supplies to Greece were halted on the morning of Aug. 6 due to a pipeline blast in neighboring Bulgaria. According to media reports, the explosion was caused by a pipeline leak in the southwestern part of the country...

Shell Moves Forward With Ukrainian Exploration.
August 8, 2007... Royal Dutch Shell has signed an agreement with Ukrainian state gas producer Ukrgazvydobuvannya (UGV) to begin exploration work on the Shebelinsky and West-Shebelinsky Blocks in the Dniepr-Donets Basin. These are believed to hold as much as 400...

Mol Purchases Croatian Retailer Tifon.
August 8, 2007... Hungarian Mol has announced that it has come to an agreement to purchase 100% of Croatian fuel retail and wholesale company Tifon for an undisclosed sum. Tifon expects to hold a 7% share of Croatia's retail market by the end of 2007. The...

Iran Plans Investments In Belarus Electricity.
August 8, 2007... Iran plans to invest 100 million ($138 million) in the electricity sector of Belarus, whose ostracized authoritarian leadership has looked to cultivate ties with countries that enjoy similarly shaky ties with the West. Iran plans to spend...

Gazprom Prices Delayed Eurobond.
August 8, 2007... After weeks of delays because of market volatility, Gazprom has reportedly priced its latest $1.25 million, 30-year eurobond at 225 points above US Treasury bonds, at the high end of the initial price guidance for the offering. Gazprom was...

Market Turmoil Slows PKN Orlen Bond Issue.
August 8, 2007... Polish refiner PKN Orlen may be the latest company affected by the current turmoil among global debt markets, as the company reportedly has signaled that it could delay a major new bond offering for at least several months because of market...

Bashneft Prepares Record Dividend Payment.
August 8, 2007... Bashneft is planning to approve a record dividend payout this September as shareholders in the Russian regional producer prepare to lose control of the asset to the state. Shareholders are expected to approve dividends of 3.34 billion...

Equities and Currencies.
August 8, 2007... Share Prices Closing On Aug. 7, 2007

Urals Firm, But Fire Sale Hits Futures.
August 8, 2007... September Brent traded in a highly dramatic $6.96/bbl range from an Aug. 1 high of $77.16 to an Aug. 7 low of $70.20 -- with the biggest fall occurring on Aug. 6 when Brent traded a $3.96 range in a fire sale triggered by an exodus of flighty...

Products Hold Up Better Than Crude Futures.
August 8, 2007... The falling crude market has undermined middle distillate prices across Europe, despite stronger demand, while fuel oil demand remained steady. ICE gas oil September futures were sent sliding when bearish US economic data and weakening...

New Era Beckons For Central Europe.
August 15, 2007... For the countries of Central Europe connected to the Druzhba pipeline that runs thousands of kilometers from West Siberia, the era of cheap and abundant Russian oil is finally coming to an end. As Russia expands the Primorsk terminal and aims...

Rosneft Takes A Pass At Yukos Auctions.
August 15, 2007... With legal battles looming on the horizon, Russian state Rosneft pulled out of the Aug.15 auction for the disputed international assets of bankrupt Yukos, leaving little-known Moscow realty firm Monte-Valle to claim the assets. Like nearly all...

Iraqi Oil Minister Had Bad News For Lukoil.
August 15, 2007... In a blow to Lukoil, Iraqi Oil Minister Hussein al-Shahristani made it very clear during his visit to Moscow last week that Russian companies will not be given any special privileges in the development of Iraqi oil reserves and will have to...

Russneft Is Still Under Pressure.
August 15, 2007... Things are getting more complicated for the former major shareholder and president of Russneft, Mikhail Gutseriev, as well as for the company's new owner-to-be, aluminum magnate Oleg Deripaska, with the freezing of Russneft's shares and the...

Gazprom Eyes E.On UK Assets.
August 15, 2007... Gazprom could secure stakes in German utility E.On's UK power generating assets as part of an asset swap deal between the two companies, according to Russian media reports last week. E.On UK owns five power stations in the UK, meeting...

Shell Wins At Rosneft Crude Tender.
August 15, 2007... Royal Dutch Shell has won the majority of Rosneft's crude volumes to be exported in the last four months of the year, which the state-controlled major offered at its first-ever tender. Shell offered the best price for Rosneft's crude...

Takeover Rumors Boost Surgut Stock Price.
August 15, 2007... Russian Surgutneftegas shares have gained over 8.5% in the past week on the RTS, Russia's main stock exchange, as another bout of takeover speculation in the Kremlin-friendly company fueled buying (NC Aug.9,p4). Surgut's 4% gains on Aug....

Court Puts Volgotanker On Last Legs.
August 15, 2007... Russian courts have initiated bankruptcy proceedings against shipping firm Volgotanker, which was at one time Europe's largest inland shipper, but has been out of operation for two summers in a row because of tax claims associated with Moscow's...

Russia Uncovers Major Field North Of Caspian.
August 15, 2007... Russian scientists believe that they have uncovered a huge onshore oil and gas field in the southern part of European Russia that could potentially boast total oil and gas reserves by billions of metric tons. Scientists from Russia's...

Gazprom Revises 2007 Spending Plan.
August 15, 2007... Gazprom's board of directors revised its 2007 investment program upward by $9.8 billion to 779.36 billion rubles ($30.7 billion), according to a company statement last week. The Russian gas company said it had increased its investment...

Correction.(Correction notice)
August 15, 2007... In the Aug. 2 issue of Nefte Compass (NC Aug.2,p1), an article entitled "Rosneft Rings the Changes on Exports" indicated that Anatoly Loktionov is involved in a number of trading companies, including Daxin Petroleum. Daxin, however, points out...

Kazakh Gas Production Up In July.
August 15, 2007... Kazakh natural gas production was up by 6.3% in July to almost 2.224 Bcm versus the previous month, and was also up 3.2% on the year. Kazakhstan's overall gas production in the first seven months of 2007 skyrocketed by 15.4% to almost...

Ukrainian Political Crisis Deepens.
August 15, 2007... Ukraine's election commission has rejected a registration request from the political party of populist Orange Revolution leader Yulia Tymoshenko for upcoming parliamentary elections, adding to the country's continuing political turmoil, which...

Mazeikiu Increases Latin American Crude Throughput.
August 15, 2007... After a year's break, Lithuania's Mazeikiu Nafta (MN) is preparing to resume refining Latin American heavy crude as it seeks to move away from its reliance on Russian supplies. MN's refinery, the only one in the Baltic states, received its...

Lisichansk Refinery Shut By Power Outage.
August 15, 2007... Ukraine's second-largest refinery, Lisichansk (Linik), operated by Russian-UK joint venture TNK-BP, was forced to stop operations due to an electricity supply cut early this week. The 320,000 b/d plant was transferred to an emergency...

Lukoil Expands Retail Business In Romania.
August 15, 2007... Lukoil, which already has a significant presence in Romania as the owner of the 100,000 b/d Petrotel refinery, is now pushing ahead with modernizing and expanding its local retail network. The company's retail subsidiary, Lukoil Romania,...

Turkmen President Sacks Energy Minister.
August 15, 2007... Turkmen President Gurbanguly Berdymukhammedov has removed Yusup Davudov from his post as minister of industry and energy and replaced him with his former deputy, Gurbannur Annaveliyev, according to a Turkmen government website. The Turkmen...

New Russia-Belarus Gas Talks Planned.
August 15, 2007... Belarus announced plans to launch talks with Gazprom on gas purchase terms for 2008, shortly after resolving its gas debt dispute with Russia last week. Minsk hopes to agree a price with Gazprom of $130/Mcm for 2008, a Russian news agency...

Mol Second-Quarter Earnings Slump.(Financial report)(Brief article)
August 15, 2007... Hungarian energy group Mol reported a 70% year-on-year drop in second-quarter net income to 26.9 billion forints ($149 million) -- far below analysts' expectations. The company, which is being stalked by Austria's OMV, blamed declining...

PKN And Lotos Report Varying Results.
August 15, 2007... Poland's leading refiner, PKN Orlen, and its smaller domestic competitor, Lotos, reported markedly different sets of second-quarter results, amid continuing speculation that the two could be heading for a merger (NC Jul.12,p8). PKN's...

Equities and Currencies.
August 15, 2007... Share Prices Closing On Aug. 14, 2007

Futures Calming Down, Urals Slightly Easier.
August 15, 2007... The September Brent futures contract, which expires on Aug. 16, eased back to trade in a less frenetic $2.90 range from an Aug. 10 low of $68.95 to an Aug. 13 high of $71.85 -- with the price pressured to the low by continuing worries about the...

Good Demand Boosts Gas Oil Prices.
August 15, 2007... Middle distillate premiums across Europe have been supported by refining run cuts, although gas oil futures and fuel oil have been undermined for most of the week by crude futures. These partly recovered late Aug. 15 on bullish US inventory...

Russia Mulls Creation Of New State Colossus.
August 20, 2007... Russia is considering setting up a new state oil colossus to rival gas giant Gazprom before President Vladimir Putin leaves office in March 2008, industry insiders tell Nefte Compass. In line with the trend toward state domination of...

Mol Eyes Russia For Upstream Growth.
August 20, 2007... Hungary's Mol considers Russia a strategic area for upstream growth, but is looking at companies and assets there that "come under the radar screen" of the political establishment, Chief Executive Gyorgy Mosonyi told Nefte Compass in an...

No Swaps In Total's Shtokman Deal.
August 20, 2007... The deal struck last month between Gazprom and Total giving the French major a 25% stake in the massive Shtokman gas project in the Barents Sea did not involve any swap deals, industry insiders tell Nefte Compass, adding that political support...

Moscow Prepares New Flaring Proposal.
August 20, 2007... Following President Vladimir Putin's recent call for a reduction in associated gas flaring and legislation to make it unprofitable, Russia's energy ministry has proposed a new measure to help solve the problem. According to a ministry...