NEFTE Compass articles from October 2008

NEFTE Compass archives from October 2008

Financial Crisis Rolls Through Russia's Oil Business.
October 1, 2008... The turmoil that has engulfed US and European financial markets has spread east to Russia, where oil and gas companies, even bankers' darling Gazprom, are finding it harder to secure the credit lines on which they have become so reliant in...

TNK-BP 'Amicably' Tackles Key Management Issue.
October 1, 2008... It is too soon to say whether the warring shareholders in TNK-BP have buried their differences. But a board of directors meeting at the end of last week -- the first since a truce was agreed Sep. 4 -- went off well and provided a platform from...

Russian Crude Production Disappoints.
October 1, 2008... Russian crude and condensate production reached 9.84 million b/d (41.597 million metric tons) in August, up 0.6% from the previous month, but 0.8% lower than a year ago (see p10). The latest data, which came from the Russian energy...

Russia, Korea Bolster Cooperation.
October 1, 2008... South Korea and Russia bolstered energy cooperation by signing a number of memorandums of understanding (MOU) during a visit by Korean President Lee Myung-bak to Russia. State Korea Gas (Kogas) signed an MOU with Gazprom to import gas from...

Eni, Gazprom Firm Up Asset Swap.
October 1, 2008... Already partners in two international gas pipeline projects, Russia's Gazprom and Italy's Eni are now advancing with plans to swap their assets. The companies said this week that Eni's chief executive, Paolo Scaroni, and Gazprom Chairman...

Russia Opens Taps For Seaborne Exports.
October 1, 2008... Russia is responding to a rise in demand for export allocations by opening up the taps in October, increasing seaborne crude oil loadings by a solid 127,000 b/d from last month. State oil pipeline operator Transneft has penciled in seaborne...

Sechin To Launch East Siberian Pipeline.
October 1, 2008... The East Siberian Pacific Ocean (Espo) oil pipeline is to be launched over the coming weekend, initially pumping crude in reverse mode from the Talakan and Verkhnechonsk oil fields to the Angarsk refinery. Russia's national pipeline...

Gazprom Outlines Winter Gas Plans.
October 1, 2008... Russia's Gazprom will accumulate 64 Bcm of commercial gas in its underground storage facilities by mid-October to secure stable gas supply to its domestic and foreign consumers during autumn and winter. The company stored 63.5 Bcm during the...

Tatneft May Go It Alone On Bitumen.
October 1, 2008... Regional producer Tatneft may be closing the door on cooperation with Royal Dutch Shell to develop the company's vast bitumen reserves and could instead be planning to go it alone on the technology-intensive development. An official with...

Zarubezhneft Announces Cuban Joint Venture.(Petroleos de Venezuela S.A.)(Cubapetroleo)(Brief article)
October 1, 2008... Russia's state Zarubezhneft has announced plans to set up two joint ventures with Cuban state oil company Cupet and Petroleos de Venezuela (PDV) in a bid to follow a Russian government initiative to strengthen oil ties with the Caribbean...

Tengiz Completes Expansion.
October 1, 2008... Chevron-operated Tengizchevroil (TCO) has completed a major expansion at the Tengiz field in Kazakhstan that will nearly double production capacity to 540,000 b/d, although production in August was less than half that figure (NC Sep.11,p8). ...

BP Calls It A Day In Kazakhstan.
October 1, 2008... BP has finally taken the decision to shed its three minority stakes in Kazakhstan, ending a long but low-key relationship with the Central Asian giant. Up for sale are both of BP's interests in the Caspian Pipeline Consortium (CPC), along...

Turkmenistan Opens Door Wider To Reform.
October 1, 2008... Turkmenistan has adopted a new constitution that for the first time allows the formation of multiple political parties and enshrines market economy principles. The constitution, which confirms the "right to private property" and support...

Kazakh Producer Gets Green Light On Shut-In Fields.
October 1, 2008... Arawak Energy, a Jersey-based company in which trading giant Vitol is the leading shareholder, has won the approval of the government of Kazakhstan for plans to develop two oil fields. "This is an important milestone in the development of...

Azeri Output Down As BP Investigates Gas Leak.(Azeri-Chirag-Guneshli)(British Petroleum Company PLC)(Brief article)
October 1, 2008... Oil production from the BP-operated Azeri-Chirag-Guneshli (ACG) field in Azerbaijan remains about 60% below its recent peak because of a safety incident at an offshore platform. The Central Azeri platform was swiftly shut down and evacuated...

UK Independent Recovers Ukraine Fields.(Cadogan Petroleum)(Poltavanaftogazgeology)(Brief article)
October 1, 2008... Cadogan Petroleum has defeated an attempt by a subsidiary of its erstwhile partner in Ukraine to strip it of its licenses for two gas fields. Cadogan, a London-based independent that is focused on gas and condensate assets in Ukraine, says...

Mazeikiu Starts Refinery Upgrade.
October 1, 2008... Lithuania's Mazeikiu Nafta (MN) oil complex is pushing ahead with upgrading its facilities to improve the quality of its oil products. MN, majority-owned by Poland's PKN Orlen and the only refinery in the Baltics, last week shut one of its...

Gazprom Neft Results Please Investors.
October 1, 2008... Gazprom oil arm Gazprom Neft said Sep. 30 that net profits rose to $2.2 billion in April-June, becoming the latest Russian company to substantially exceed analysts' expectations thanks to soaring oil prices in the first six months of the year....

Russian Ministry Foresees Massive Shelf Costs.
October 1, 2008... Russia's natural resources ministry estimates that the geological survey of oil and gas reserves offshore Russia will cost almost 613 billion rubles ($25 billion) through 2020. Of this sum, around 570 billion rubles will be invested by Russian...

Petrovietnam Seeks Investment Permission.
October 1, 2008... State Petrovietnam has applied for permission from the Vietnamese government to contribute $614 million to its joint venture with Russian state Zarubezhneft, which is developing a group of fields located in the northern Nenets region of Russia...

Volatile, With A Downward Bias.
October 1, 2008... Futures markets remained in thrall to financials and November ICE Brent futures on Sep. 29 lost $9.56 to settle at $93.98 after a mutinous US House of Representatives threw out a controversial $700 billion bailout bill. The contract recovered...

German Demand Supports Gas Oil.
October 1, 2008... Gas oil cracks are quietly strengthening as German end-users continue to buy, and there is also some flow of gas oil toward the Southern Hemisphere. South Africa and Latin America are moving toward higher summer temperatures, encouraging a...

Sakhalin To Launch New Crude Stream.
October 8, 2008... A new blend of Russian crude is due to hit world markets after the Sakhalin-2 development on the Pacific shelf starts year-round production at the end of 2008. Until now, Sakhalin-2 has delivered to world markets a crude known as Vityaz,...

Chevron Loads First Caspian Tanker With Tengiz Crude.
October 8, 2008... The Chevron-operated Tengizchevroil (TCO) joint venture is stepping up a gear at the supergiant Tengiz field in Kazakhstan. After hiking its oil production capacity by more than 50% to 540,000 barrels per day last month, the company was due...

Sakhalin Is Set For A Busy Few Years.
October 8, 2008... The next few years will be rather busy offshore Sakhalin in Russia's Far East. The Exxon Mobil-led Sakhalin-1 consortium is to push on with developing its two remaining fields, Gazprom plans to start drilling at Sakhalin-3 next year, and...

Sakhalin-2 Third Train In The Making.
October 8, 2008... The decision on the construction of the third LNG train for the Sakhalin-2 project on the Russian Pacific shelf will not be taken before 2010, according to Ian Craig, chief executive of Sakhalin Energy, the operating company for the...

Shmatko Says GECF Is 'No Opec'.
October 8, 2008... Russia's energy minister, Sergei Shmatko, urged German industrialists, visiting St. Petersburg with the country's chancellor, Angela Merkel, on Oct. 2, to invest heavily in projects to save energy inside Russia, promising their investments...

E.On Secures Yuzhno Swap Deal.
October 8, 2008... E.On last week secured agreement from Gazprom to a swap that will give the German company its long-expected 25% stake in the huge Yuzhno-Russkoye West Siberian gas field -- without requiring it to give up any stake in generation or other core...

Talks Over Sakhalin-1 Gas Exports Stalled.
October 8, 2008... Talks between Gazprom and Sakhalin-1 operator Exxon Mobil over the handling of nonassociated gas from the project have stalled. Gazprom is still insisting that Sakhalin-1 gas is needed to gasify Russia's Far East. The Sakhalin-1 consortium is...

Russian Exports Rise On Transneft Surge.
October 8, 2008... Backed by a surge in shipments from the network of Russian crude oil pipeline monopoly Transneft, overall exports of Russian crude rose to 3.981 million b/d (16.292 million metric tons) in September, up more than 100,000 b/d from 3.874 million...

Russian Production Resumes Slide In September.(Brief article)
October 8, 2008... Russia's crude oil and condensate output fell to 9.834 million b/d in September, 0.4% down on September 2007 and a slight drop on the 9.836 million b/d produced in August, according to preliminary energy ministry data. The decline marks...

'Kremlin Trader' Snaps Up Novatek Stake.
October 8, 2008... A holding company for Kremlin-connected oil trader Gennady Timchenko has accumulated over 5% in independent Russian natural gas producer Novatek, whose shares have been hammered by the global financial crisis. Volga Resources, a subsidiary...

Gazprom To Explore Deltana In Venezuela.
October 8, 2008... Russian Gazprom and state Petroleos de Venezuela (PDV) are planning joint development of several natural gas blocks in the estimated 38 Tcf Deltana Platform area offshore Venezuela. PDV has offered Gazprom the Ballena field in Block 4 and...

Gazprom Unveils Gas Sector Plans.
October 8, 2008... Gazprom believes that between $544 billion and $647 billion needs to be invested in the Russian gas industry by 2030 if the country is to meet domestic requirements as well as export commitments. A draft development plan from the Russian...

Shell Plans A JV In Russia's Yakutia.
October 8, 2008... Royal Dutch Shell is negotiating to buy 50% of Russian independent Taas-Yuryakh Neftegasdobycha (TYN), which plans to produce 120,000 b/d by 2015 from its East Siberian Middle Botuobinsk field, Russian business daily Kommersant reported....

Moscow Seeks Funds For Transneft's Projects.
October 8, 2008... The Russian government is mulling ways of helping state pipeline giant Transneft finance ambitious projects amid the current global credit crunch. The finance and economic development ministries are working with the Federal Tariff Service...

More TNK-BP Managers Quit.
October 8, 2008... Two more senior TNK-BP executives will step down in a move that analysts say will render the joint venture more Russian-oriented. The two -- Tom Wright, executive vice president for planning and performance management, and Steve...

Kazakhs Differ Over Kashagan Start Date.
October 8, 2008... Confusion reigns over the projected start-up of the Eni-operated Kashagan field offshore Kazakhstan, which, with in-place reserves of some 34 billion bbl and projected peak capacity of 1.5 million b/d, is one of the world's largest. Eni,...

US Firm Advances In Georgia.(Brief article)
October 8, 2008... Despite starting a drilling program in Georgia in August, around the time of the Russian military incursion, Houston-based Frontera Resources reports good progress at a field in Block 12 in the east of the country. "We are very pleased...

Conoco Clinches Kazakh Field.
October 8, 2008... ConocoPhillips has teamed up with the UAE's Mubadala Development to explore and develop N Block, Kazakh state company Kazmunaigas (KMG) said. A memorandum of understanding was signed by KMG Chief Executive Kairgeldy Kabyldin, Conoco Chief...

Lukoil, KMG Eye BP's CPC Stake.
October 8, 2008... Russia's Lukoil and Kazakh state Kazmunaigas (KMG) have both confirmed their interest in buying BP's stake in the Caspian Pipeline Consortium (CPC) pipeline, which runs from Kazakhstan's giant Tengiz field to the Russian Black Sea port of...

Kiev, Moscow Forge New Gas Deal.
October 8, 2008... Ukrainian Prime Minister Yulia Tymoshenko has secured an agreement with Russia setting out a framework for long-term gas supplies. State Naftogaz Ukrainy has yet to finalize a contract agreement with Gazprom, and concerns linger that the...

Regal Kills Talk Of Shell Buyout.
October 8, 2008... UK-listed Regal Petroleum has become the latest independent producer to be gripped by rumors of a buyout from a Western major. Regal last week had to repudiate reports that the company had received a $1.2 billion buyout offer from Royal Dutch...

BG Makes A Stand In Kazakhstan.
October 8, 2008... BG is adopting a two-pronged strategy in Kazakhstan, one of its key markets. On the one hand, it is taking a firm stand against paying a new duty on oil exports from its Karachaganak field, which it believes goes against the spirit of its...

Kazakhstan Braced For Financial Backlash.(Brief article)
October 8, 2008... Kazakhstan is bracing itself for a backlash from the global financial crisis, but experts at the annual Kioge oil and gas conference in Almaty this week said it was in a good position to weather the storm. The Kazakhs have no illusions...

Gazprom Neft Ruled Out Of Kazakh Merger.
October 8, 2008... Russia's Gazprom Neft has been ruled out of the race to buy a stake in Mangistaumunaigas (MMG) as the saga over the future of Kazakhstan's last sizable independent producer continues to unfold, according to reports from Almaty. India's Oil...

Iran To Start Supplying Armenia With Gas.
October 8, 2008... Iran may start supplying natural gas to neighboring Armenia next week, according to media reports citing an official at state National Iranian Gas Co. Armenia will begin supplying Iran with electricity over the weekend, while Tehran will...

Russian Majors Turn To Kremlin For Financing Help.
October 8, 2008... In a dramatic sign of the widening impact of the global financial crunch on Russia, four of the country's largest oil and gas producers have asked the Kremlin to provide government loans to replace their foreign borrowings, Lukoil revealed this...

Futures Down, Differentials Hold.
October 8, 2008... Financial storms continued to wreak havoc around the world, and commodity markets were no exceptions. Crude oil futures at times looked headed for free fall. November ICE Brent futures traded in a $16.03 range, mostly downhill, from a $97.03...

Buyers Hold Back As Gas Oil Eases.
October 8, 2008... Middle distillate prices have weakened, as German buyers are not yet feeling the full force of winter and have bought fairly extensively already. At the same time, the credit crunch is taking hold, and many are expecting greater availability,...

Turkmenistan Takes Its Place Among Gas Elite.
October 15, 2008... A new audit has confirmed Turkmenistan's place among the elite of the world's natural gas-producing nations. The survey of the South Yolotan-Osman field by international petroleum consultancy Gaffney, Cline & Associates indicates that it...

Gazprom Targets North American LNG Market.
October 15, 2008... Gazprom's ambitions for a role in the North American LNG market have moved a step closer amid reports that it could get a blocking stake in the planned Rabaska LNG import terminal in Canada. The Russian state gas giant may get a 27% stake...

Novatek Ramps Up Production.
October 15, 2008... Top independent Russian gas producer Novatek said last week that its natural gas production shot up to 7.64 Bcm in the third quarter of the year, up an impressive 27% from the third quarter of 2007 thanks to easier access to the pipeline...

Producers Again Shy Away From Exports.
October 15, 2008... Dissatisfied with inconsistent netbacks from exports amid the current market volatility, Russian oil firms are expected to cut back on sales outside of Russia in November, traders said this week. Global crude prices have fallen steadily in...

TNK-BP's Dudley Gets Belated Court Relief.
October 15, 2008... A Moscow court has overturned a ruling barring TNK-BP Chief Executive Robert Dudley from working in Russia for two years because of labor violations, providing another, albeit tardy, bit of relief for the firm following a peace agreement...

Verkhnechonsk Starts Commercial Production.(Brief article)
October 15, 2008... Rosneft and TNK-BP have started commercial crude oil production from the massive Verkhnechonsk field, which is expected to be a cornerstone for development of largely unexplored East Siberia. The first batch of crude was delivered on...

TNK-BP Mulls Lower Investment, Profits Surge.
October 15, 2008... Russian-UK joint venture TNK-BP expects investment of between $3.5 billion and $4.5 billion in 2009, Chief Operating Officer Tim Summers reportedly said this week, suggesting the company is prepared to scale back its spending amid a global...

State Drops Final Court Case Against Russneft.
October 15, 2008... Russia's tax service has dropped the last of seven court cases against Russneft, potentially clearing the way for the independent oil firm's purchase by aluminum magnate Oleg Deripaska. The decision should result in the freeze on Russneft's...

Lundin Advances With Caspian Discoveries.
October 15, 2008... Swedish independent Lundin has found oil in the Lagansky Block in the Russian sector of the Caspian Sea, where state giant Gazprom has the option of acquiring a controlling stake of 50% plus one share. "This is a major discovery," Lundin...

CPC Expansion Plans Stall Again Over Financing.
October 15, 2008... The shareholders in the Caspian Pipeline Consortium (CPC) have failed to agree on the expansion of the pipeline because of a bitter dispute over the expansion's financing. A memorandum on expanding the pipeline, which runs from...

Kazakhstan Rocked By Global Crisis.
October 15, 2008... The global financial crisis has sounded the alarm bells in Kazakhstan, which in recent weeks has witnessed a hammering of its stock exchange, with the share prices of leading companies such as minerals giants Kazakmys and ENRC losing more than...

BP Restores Azeri Production Platform.
October 15, 2008... BP says that the gas leak under the Central Azeri platform on its Azeri-Chirag-Guneshli (ACG) field offshore Azerbaijan has stopped, ending fears that, at worst, the platform would have to be abandoned. The platform was evacuated and shut...

Kazakh Producer To Buy Back Falling Shares.
October 15, 2008... Falling share prices have prompted Kazakh oil producer Kazmunaigas Exploration Production (KMG EP) to announce a share buyback program. KMG EP said current market prices "do not reflect the true underlying value of the business," adding...

CNPC To Finance Kazakh Pipe.
October 15, 2008... State China National Petroleum Corp. (CNPC) has proposed financing the second line of the planned 40 Bcm/yr Kazakhstan-China gas pipeline in a bid to secure gas supplies at a time when negotiations over Russian supplies have stalled (NC...

Lukoil To Upgrade Bulgarian Refinery.
October 15, 2008... Russia's top independent producer, Lukoil, plans to invest $1.2 billion in its Bulgarian Neftochim Bourgas refinery by 2014 to modernize the plant and improve its fuel quality to satisfy European Union requirements, Lukoil's president, Vagit...

TNK-BP Expands In Ukraine.
October 15, 2008... TNK-BP plans to have 400 retail stations in Ukraine in the next three to five years, a TNK-BP Commerce official said in Ukraine said last week. Right now, it has 50 stations of its own and around 200 operated under franchise. The stations...

BG Signs For New Kazakh Gas Study.(KazMunaiGas)(Brief article)
October 15, 2008... BG and Kazakh state Kazmunaigas have signed an agreement to cooperate on an analysis of the natural gas market in Kazakhstan. The agreement follows the completion of a gas master plan study by the British gas company that had covered energy...

Kremlin Coughs Up $9 Billion For Oil Firms.
October 15, 2008... The Russian government is reportedly prepared to lend $9 billion to the country's top private and state-owned oil and gas companies to cushion them against the worst effects of the global financial crisis. Although such a deal was expected...

Equities and Currencies.
October 15, 2008... Share Prices Closing On October 14, 2008

Prices Pressured By Declining Demand.
October 15, 2008... A global rescue package worth a staggering $3.5 trillion appears to have calmed some stormy financial waters -- at least for now -- but not before oil prices gyrated through another volatile week. November ICE Brent futures traded a $14.86...

End-Users Rush To Cash In On Lower Prices.(Brief article)
October 15, 2008... The ICE gas oil front-month has weakened continuously since the start of October, and this week was no exception. October gas oil's highest trade this week was $811.75/ton on Oct. 9, and after the contract's expiry on Oct. 10, November hit...

Moscow's Position Grows As Crisis Widens.
October 22, 2008... Top Russian officials continue to insist that Moscow is set to weather the growing global economic storm. However, the actions of both the state and private producers in recent days suggest that the country's oil industry could emerge from the...

State Pressure Intensifies Despite Eroding Confidence.
October 22, 2008... While Moscow tried again this week to persuade foreign investors that Russia is one of the safest places in the world to plow money into, two projects led by international firms found themselves under fresh pressure. The natural resources...

Supplies To Czech Republic Restored.
October 22, 2008... Russian crude supplies to the Czech Republic via the Druzhba pipeline were fully restored in September, reaching their usual level of 110,000 b/d after reductions in the two previous months caused by a trader conflict. The increase in...

Leading Three Forge 'Gas Opec'.
October 22, 2008... Russia, Iran and Qatar, the world's three largest holders of natural gas reserves, have taken the initial steps in forming an organization that some are describing as an Opec for gas producers -- sparking fears in Europe and the US that...

Rosneft Outlines Investment Plans.
October 22, 2008... Russian state Rosneft may boost investment next year despite the ongoing global financial crisis, with First Vice President Sergei Kudryashov saying that, for the time being, the company still plans to implement the version of its investment...

Oil Services Sector Hit By Financial Turmoil.
October 22, 2008... Russia's oil services companies are growing increasingly worried that the ongoing global financial turmoil and lower oil prices will hit the development of the sector just as it is looking to expand aggressively and is becoming more profitable....

Russneft's Fate Remains In The Air.
October 22, 2008... The fate of Russia's biggest independent oil producer, Russneft, is still in the air, although all the barriers to its sale have recently been removed. Aluminum magnate Oleg Deripaska, who agreed last year to buy Russneft, has found...

Shell Seeks Russian Exploration Returns.
October 22, 2008... Foreign investors in Russia's oil and gas sector are worried about the absence of guaranteed returns on exploration spending. Royal Dutch Shell Chief Executive Jaroen van der Veer expressed this common concern of foreign oil companies at an...

Government Pressure Cuts Product Prices.
October 22, 2008... Government pressure on Russian oil companies to cut prices for oil products appears to have had the desired effect, with oil majors announcing that they would cut prices for jet kerosene and gasoline due to the drop in oil prices. Gazprom...

TNK-BP Eyes Libyan Field.
October 22, 2008... TNK-BP is negotiating to develop Libya's Sarir field after the Russian-UK venture's warring shareholders agreed a truce that allows it to compete with BP worldwide (NC Sep.11,p1). A TNK-BP source confirmed Oct. 20 that the company is...

Gazprom Expands In Africa.
October 22, 2008... Pursuing its goal of becoming a global energy player, Russia's Gazprom is expanding in Africa, inking an energy cooperation deal with Equatorial Guinea LNG (EGLNG), according to media reports this week. The accord was reportedly signed during a...

Trans-Balkan Bosporus Bypass Delayed.
October 22, 2008... Construction of the Bourgas-Alexandroupolis pipeline, designed to carry Russian oil to Greece via Bulgaria, will now begin in October 2009 -- later than scheduled -- and be completed by 2011, according to Bulgaria's regional development and...

Kazakh Gas Production Falls.
October 22, 2008... Kazakh gas production totaled 1.871 Bcm in September, down 22.6% from the previous month and down nearly 11% from a year ago, as the Karachaganak field is currently undergoing a major maintenance program, with production shut in completely for...