World Gas Intelligence articles from November 2006

World Gas Intelligence archives from November 2006

Gazprom, Exxon pipe talk.
November 1, 2006... What's going on between Exxon Mobil and Gazprom? More than meets the eye, WGI is told. Exxon and China National Petroleum Corp. (CNPC) signed a heads of agreement Oct. 19 for the sale of 8 billion cubic meters per year (775 million cubic...

Malaysia LNG struggles with output.
November 1, 2006... While Indonesia has played the sick man of Asia-Pacific LNG, state Petronas' big Malaysian LNG (MLNG) complex has capitalized on its neighbor's unreliability to market its own, supposedly contrasting dependability. However, Japanese...

Militants' toll on Nigerian gas projects.
November 1, 2006... Turbulence in the Niger Delta has taken a heavy toll on Nigerian oil production, forcing producers to shut in at least 600,000 barrels per day since February. It has also taken a toll on gas projects, including both the West African Gas...

Bolivian investment outlook still uncertain.
November 1, 2006... Much skepticism gave way to some flexibility on both sides, allowing strained contract negotiations between the government of Bolivia and private upstream operators to finally reach a happy ending. Under new deals announced this week, the...

UAE's Dana hopeful on Iran, Pakistan.
November 1, 2006... The head of UAE-based Dana Gas says that the key reason for delays in Iranian exports is not gas price renegotiations, but rather a dispute with a contractor that has set back the upstream project. And he maintains that Iranian gas will start...

Turkey to Italy pipes.
November 1, 2006... Gas is not expected to start flowing through the Turkey-Greece pipeline until June 2007, an official from Greek gas company Depa tells WGI, back from an earlier target date of end-2006 (WGI Apr.26,p1). The holdup is at the Evros River that...

China set for spot.
November 1, 2006... China National Offshore Oil Corp. (CNOOC) is laying the groundwork for its potential entry into spot trading (WGI Oct.25,p4). CNOOC said last week that it had signed master agreements with Royal Dutch Shell and French firms Suez and Total for...

Sonatrach dismisses "cartel talk".
November 1, 2006... Sonatrach Marketing Vice President Chawki Rahal in Paris last Thursday provided an update on the Algerian state company's two new planned pipelines to southern Europe--and sought to allay concerns over a deal it signed this summer with Gazprom....

US prices buck glut.(MARKET INSIGHT)
November 1, 2006... Before rolling off the board last week, November US gas futures muscled to nearly $8 per million Btu--despite the fact that US and Canadian gas inventories are at unprecedented highs, peaking at just over 3.9 trillion cubic feet (110 billion...

No way Spanish power sector can avoid using more gas.(Current)
November 1, 2006... Already Europe's fastest growing natural gas importer and a major--and sometimes aggressive--LNG buyer, Spain is facing the prospect of ever increasing dependence on imported gas to cover the needs of its power producers, as Madrid seeks to...

Russian entry confuses Southeast Europe's pipe rivalry.(Horizon)
November 1, 2006... Until recently, expectations were that two main new pipelines would deliver giant incremental volumes of gas to Europe from the east: Nord Stream--once known as North European Gas Pipeline (NEGP)--would be the main route for Russian gas in the...

Gazprom starts spending.
November 8, 2006... The Russian government has now admitted to a looming shortfall in gas to meet the combination of domestic needs and export commitments, with the result that state-controlled Gazprom seems set to start plowing more of its recently hefty profits...

BP vs BG in RWE's Egyptian LNG gambit.
November 8, 2006... German utility RWE is pinning its hopes for becoming an equity LNG producer on BG's plans for a third Egyptian LNG train at Idku--at the risk of alienating existing upstream partner BP. With little fanfare, BG and RWE signed a memorandum of...

Indonesia still trying to up LNG flows.
November 8, 2006... Despite all the talk of giving preference to domestic markets and cutting back sharply on LNG exports, Indonesia appears to be making every effort to compensate for the shortfall in shipments from its Bontang and Arun liquefaction plants to...

Suez progress on Florida LNG project.
November 8, 2006... The future of LNG in Florida remains uncertain, but French utility Suez has come a step closer to gaining a presence in the US state (WGI Nov.23'05,p4). The US Coast Guard announced earlier this month that Suez's application for the proposed...

BG talks LNG with Petrobras, Gazprom.
November 8, 2006... BG Group Chief Executive Frank Chapman last week outlined talks on potential LNG supply relationships with Brazil's Petrobras and Russia's Gazprom, both state-controlled companies. "We are having very preliminary talks with Petrobras to see...

Nasty Arctic surprise.
November 8, 2006... The Arctic regions of the US and Canada may have substantial volumes of oil and gas locked beneath icy waters and frozen tundra across the far northern latitudes, but the resources in place don't come close to matching those that exist in the...

European blackout.
November 8, 2006... The power blackout that affected around 10 million households and businesses in Western Europe--half of them in France--for about an hour last Saturday evening, Nov. 4, could easily have been much worse, according to the operator of the French...

Spanish gas demand growth slows.
November 8, 2006... Spanish gas sales reached 25.1 billion cubic meters in the first nine months of 2006 (292.3 terawatt hours of gas, or 3.25 billion cubic feet per day), an increase of 6.5% from the equivalent period last year, according to national industry...

Costly Asian LNG.(MARKET INSIGHT)
November 8, 2006... Average Japanese and South Korean LNG import prices continued to rise in late summer and early fall, despite a decline of nearly $10 per barrel from July to September in the oil prices to which they are indexed. This means that the Japanese and...

Power sector set to drive Korean LNG demand higher.(Current)
November 8, 2006... South Korea is set to become an even bigger LNG consumer as state Korea Electric Power Corp. (Kepco) ramps up investment in gas-fired power plants to meet electricity demand that is forecast to grow as much as 5% annually until 2010. ...

Sun shines brightly on weather derivatives these days.(Horizon)
November 8, 2006... The global market for weather derivatives--which allow companies to hedge risks associated with the essential unpredictabi

Kogas' take on LNG.
November 15, 2006... Faced with looming expiration of long-term LNG purchase contracts and increasing domestic gas demand, Korea Gas (Kogas) is pushing for renewals of medium-term contracts and additional term supply. It may find the search tough going. The...

EU clears Suez-GdF merger.
November 15, 2006... As widely expected, the European Commission on Tuesday approved the merger of France's Suez and Gaz de France (GdF), creating a 79 billion [euro] ($101 billion) global energy and LNG giant, though not without strings. The commission said...

Bigger Panama Canal, more LNG trade.
November 15, 2006... The Panama Canal is too small to allow for the passage of standard LNG vessels. But that looks set to change by 2014, when an ambitious $5.23 billion plan to expand the Canal is due to be completed. Two weeks ago, Panamanians voted...

BHP's terminal nears 'judgment day'.
November 15, 2006... LNG terminal development on the US West Coast is proceeding with fits and starts. Most recently, Australia's BHP Billiton has seen the schedule for its Cabrillo Port proposal offshore Malibu pushed back in the face of political indecision and...

Gazprom signs ENI deal, hints at others.
November 15, 2006... Gazprom and Italy's ENI signed what they termed a "broad strategic agreement" in Moscow on Tuesday, extending through Russian gas supply contracts, to upstream and LNG cooperation. It follows another attempt last week by Gazprom to explain...

Back to the future for industrial users?
November 15, 2006... Probably no segment of the natural gas market has been affected more by the relatively high prices of recent years than industrial consumers, which often use gas or gas products both for feedstock and for fuel. North American operators have...

Kuwait's new find.
November 15, 2006... Kuwait plans to launch production next year from its newly discovered Umm Niqa gas field. Gas-poor Kuwait's schemes to import gas--involving proposed deals with Qatar, Iraq and Iran--have faltered. So an indigenous source of new gas would...

Pakistan ponders new pricing.
November 15, 2006... Pakistan's government may revise wellhead gas prices, increasing the ceiling on oil price escalation by as much as one-third to $45 per barrel of oil equivalent, in order to boost investment in the country's flagging upstream, officials tell...

Golar's new role.
November 15, 2006... Golar LNG has agreed to buy a 20% stake in OLT Offshore LNG Toscana (OLT-O), developer of a 3.75 billion cubic meter (2.7 million ton) per year import terminal, 20 kilometers offshore Livorno in northwest Italy. The deal announced Friday...

German hubs.(MARKET INSIGHT)
November 15, 2006... E.On Ruhrgas's new "choice market" trading hub in northern Germany appears to have bolstered spot liquidity, but remains far behind the UK, Belgian and Dutch hubs further west. The next step-up in German market liquidity could depend on a...

Fall out spreads quickly from Europe's big blackout.(Current)
November 15, 2006... The electricity blackout that hit large parts of Western Europe Nov. 4 could have major implications for the way the continent's transmission systems are operated, as regulators and politicians look for ways to make sure a similar--or...

Mideast moves to keep more of its gas close to home.(Horizon)
November 15, 2006... Countries across the Mideast Gulf and North Africa are starting to keep a tighter grip on their gas reserves in order to feed growing domestic demand, adding to uncertainty over the growth potential for internationally traded gas (WGI...

RasGas' new Asian deals.
November 22, 2006... Despite claiming five months ago that it was "sold out," Qatar has found some spare LNG to satisfy Asian requirements (WGI Jun.14,p8). Tuesday, Qatar signed a heads of agreement to supply South Korea's state Korea Gas (Kogas) with 2.1 million...

TNK-BP signs pact with Gazprom.
November 22, 2006... TNK-BP and Gazprom petrochemical subsidiary Sibur have agreed to set up a joint venture to process the Russian-UK company's associated gas in West Siberia, providing an example for other oil majors and Russian independents on how to cooperate...

Saudis rethinking gas exports.
November 22, 2006... Saudi Arabia is going offshore in search of nonassociated gas, including the Mideast Gulf and the Red Sea. The aim is to add at least 5 trillion cubic feet (142 billion cubic meters) per year to gas reserves over the next ten years. The...

Argentina sneezes, Chile catches cold.
November 22, 2006... A strike by oil workers in Argentina last week forced that country to cut by some 30% the 775 million cubic feet (22 million cubic meters) per day of gas it normally exports to neighboring Chile. While the strike is now over and gas flows from...

Algeria's Italian pipe overtakes Spain line.
November 22, 2006... The Galsi pipeline linking Algeria to northwest Italy via Sardinia last week racked up gas sales equal to three-quarters of its planned 8 billion cubic meter per year (773 million cubic feet per day) capacity, as Italy's Edison and Enel plus...

E.On's Algeria deal.
November 22, 2006... Algerian state Sonatrach and E.On Ruhrgas last week signed a memorandum of understanding (MOU) to examine E.On's prospects for importing Algerian LNG and marketing it in Europe--marking a fresh approach to E.On's future LNG purchasing strategy....

German hub boost.
November 22, 2006... German networks regulator BNetzA's decision on Friday no longer to allow the "single contract" network access model means that all Germany gas suppliers henceforth must book transportation capacity according to a system introduced five months...

Canadian drilling dive.
November 22, 2006... Canada's drilling rig count is dropping by the week as producers reduce planned activities in the face of rising costs and shrinking margins. As the suppliers at the far end of the pipe network, Canadian producers, along with their US...

Land ahoy!(Market insight)
November 22, 2006... Floating LNG storage plays held since June are said to be unwinding, as cargoes move toward final destinations. WGI hears that most of the roughly 10 ships waiting at sea are likely to discharge their cargoes in the next month or two, instead...

Banks lend New York flavor to US power marketing fray.(Current)
November 22, 2006... Soon after US power markets began deregulating in the mid-1990s, power marketers bought and sold generation assets with heady abandon. Almost five years after the California energy crisis and Enron bankruptcy gave speculative energy trading a...

Natural gas vehicles quietly building US Market--at last.(Horizon)
November 22, 2006... In the late 1980s and early 1990s, natural gas-powered vehicles (NGVs) were widely seen as the solution to a couple of US national energy concerns: reliance on imported oil and refined products, and a drop in natural gas demand that had pushed...

Algeria favors pipes over LNG.
November 29, 2006... Algeria is still aiming for gas exports of 85 billion cubic meters (8.2 billion cubic feet per day) in 2010, up from 65 Bcm last year, officials told the Algeria Energy Week conference in Oran, Algeria, this week. But pipelines rather than LNG...

Russian gas price debate turns serious.
November 29, 2006... Moscow's struggle to deal with a looming shortage of gas to meet expanding internal and export obligations has done what neither EU nor US pressure succeeded in doing in the context of Russia's now concluded negotiations to join the World Trade...

Nigeria-to-Algeria pipe progresses.
November 29, 2006... Algerian officials say that the 20 billion cubic meter per year (1.9 billion cubic foot per day) Trans-Saharan Gas Pipeline (TSGP) connecting Nigeria to Algeria will be sending gas to Europe in 2015. Following a feasibility study conducted by...

Trinidad gas shortfall squeezes Jamaica.
November 29, 2006... Trinidad and Tobago's apparent gas shortage is having ripple effects across the Caribbean--and the waves could wash ashore at Atlantic LNG's expansion site. Jamaica and Trinidad signed a memorandum of understanding (MOU) for an LNG project...

Spanish Iberdrola's Scottish Power ideas.
November 29, 2006... The board of UK utility ScottishPower has agreed to a [euro]17.2 billion ($22.5 billion) takeover offer from Spain's second largest utility and gas importer, Iberdrola. Although unlikely to raise major competition objections--since neither...

Poland's Russia deal belies harsh words.
November 29, 2006... Despite Warsaw's boisterous opposition to all things Russian--and contrary to vows that it will diversify its energy supplies--Poland appears to have further solidified its dependence on the gas and oil giant to its east through a new deal with...

New chevon LNG hope.
November 29, 2006... Chevron has yet to arrange adequate LNG supply either for the 1 billion cubic feet per day (7.5 million tons per year) of capacity it has in Cheniere Energy's Sabine Pass terminal or for its own planned Casotte Landing regasification plant at...

RWE, Excelerate deal.
November 29, 2006... German utility giant RWE has locked up an agreement to market all the gas that US Excelerate Energy delivers to its Teesside LNG terminal in the UK--but has not said for how long (WGI Sep.13,p2). The facility is due to start operations in...

Shifting German sands.
November 29, 2006... Germany's federal cartel office has welcomed binding undertakings from three suppliers that they will open up their long-term contracts. Bundeskartellamt President Ulf Boge says legal action against Wingas, Saarferngas and Gasunion has been...

Market insight: stable Euro end-use prices.
November 29, 2006... End-user gas prices increased only modestly in most of the European countries surveyed for WGI by Energy Advice in the three months to October (see European End-User Price Supplement). Electricity prices have also been mostly stable or lower...

Russia aims to save gas by building new gas-fired plants.(CURRENT)
November 29, 2006... In an effort to meet rapidly rising electricity demand, Russia plans to add at least 23 gigawatts of new capacity by 2010, at an estimated cost of some $83 billion dollars, including accompanying investment in its power grid. Indeed, officials...

Australia's coal bed methane business poised for takeoff.(HORIZON)
November 29, 2006... A recent A$606 million (US$451 million) bid by Australian upstream independent Santos for coalbed methane (CBM) player Queensland Gas has thrown a spotlight on Australia's burgeoning CBM industry, where gas output has more than doubled in the...

WGI supplement: european end-user price (eurocents/kWh).
November 29, 2006... WGI SUPPLEMENT: European End-User Prices (eurocents/kWh) --100,000 cm/yr-- --1 Million cm/yr-- Gas Prices: Typical High Low Typical High Low Belgium Oct. '06 3.27 3.44 3.10 2.77 2.94 2.66 ...