Petroleum Intelligence Weekly articles from April 2007

Petroleum Intelligence Weekly archives from April 2007

PIW survey: oil reserves are not rising.
April 2, 2007... In contrast to the gradual rise in global oil reserves that has been reported annually in most surveys based on public sources, a new assessment by PIW shows that the trend in worldwide liquids reserves is actually one of stagnation and modest...

BP pitches in to assist at Yukos' funeral.
April 2, 2007... Russia's state Rosneft was the widely predicted winner of the first open lot in the liquidation auction of Yukos, bidding $7.6 billion for the 9.44% equity stake that bankrupt oil major Yukos held in Rosneft itself. This represented a roughly...

Noose tightens around Iran's energy projects.
April 2, 2007... As the US and its allies tighten the financial screws on Iran over its refusal to curb its nuclear ambitions, European and Asian oil companies face little choice but to shelve plans to make multibillion-dollar investments in the country. This...

Do Conoco, Anadarko suffer from excess gas?
April 2, 2007... ConocoPhillips and Anadarko placed big bets on the North American gas market last year, and took plenty of flak for it at the time--exactly a year ago, Conoco paid $35.6 billion for Burlington Resources at a time when gas prices were at record...

MLPs cast their net into upstream.
April 2, 2007... Master limited partnerships (MLPs) have lately played an important role in the midstream segment of the US oil and gas industry, investing in assets such as pipelines and storage facilities. But more recently the MLP structure has once again...

Biofuels boom, imports rock US refiners.
April 2, 2007... Less than two years ago, the US refining industry faced calls for increasing investment in new capacity after Hurricanes Katrina and Rita knocked out several Gulf Coast plants and sent product prices soaring. But refiners are now questioning...

Corporate.(GENERAL)(appointment of Christophe de Margerie)(Brief article)
April 2, 2007... CORPORATE -- The newly appointed chief executive of Total, Christophe de Margerie, has been placed under investigation by French judicial authorities, who are launching a formal inquiry into the development of the South Pars project in Iran in...

Corporate.(GENERAL)
April 2, 2007... CORPORATE -- UK independent and darling of the new frontier, Cairn Energy, announced worse-than-expected results for last year, slashing gas reserves in Bangladesh, but sweetening the bitter pill by confirming it would return [pounds...

Industry Restructuring.(GENERAL)
April 2, 2007... INDUSTRY RESTRUCTURING -- State-controlled Energias de Portugal (EDP) has agreed to buy Horizon Wind Energy from Goldman Sachs for $2.9 billion, including assumed debt and forward capex, giving EDP 3,800 MW gross of wind turbines in operation...

People.(GENERAL)
April 2, 2007... PEOPLE -- Royal Dutch Shell Chief Executive Jeroen van der Veer, who turns 60 in October, is to stay until Jun. 30, 2009, extending his tenure for one year more than expected. He had originally intended to retire in July 2008. An economist,...

Algeria.(COUNTRIES)(Brief article)
April 2, 2007... ALGERIA -- Norway's Statoil has completed tests at its first exploration and appraisal well, HTJ-2, in the Hassi Mouina license area northwest of the In Salah gas field in the Sahara Desert. The well, aimed at appraising an earlier discovery by...

Indonesia.(COUNTRIES)
April 2, 2007... INDONESIA -- French major Total has become the latest foreign oil company to be linked to Exxon Mobil's giant Natuna D-Alpha block, where Indonesian officials appear keen to cut down Exxon's role. "We are interested, but only if we are...

Iraq.(COUNTRIES)
April 2, 2007... IRAQ -- China looks set for a second shot at the upstream as Baghdad is ready to renegotiate rather than reject a production sharing contract (PSC) struck by China National Petroleum Corp. (CNPC) with the ousted regime of Saddam Hussein to...

Iraq.(COUNTRIES)(Kurdistan Regional Government)(Brief article)
April 2, 2007... IRAQ -- The Kurdistan Regional Government (KRG) in the north has already partially completed six to seven new contracts with foreign oil companies--to add to its five existing contracts--and hopes to sign a total of 10 or more new contracts by...

Libya.(COUNTRIES)
April 2, 2007... LIBYA -- Russian state gas monopoly Gazprom has signed an exploration and production sharing agreement (Epsa) with state National Oil Corp. (NOC) for four blocks in offshore Area 19. Gazprom, one of the last of the winners in the third Epsa-4...

Lithuania.(COUNTRIES)(Brief article)
April 2, 2007... LITHUANIA -- Polish refiner PKN Orlen is considering buying the Klaipedos Nafta (KN) terminal at the port of Klaipeda, strengthening its position in the Baltic state, where it already owns the Mazeikiu Nafta (MN) refinery. New PKN Orlen head...

Malaysia.(COUNTRIES)(deepwater discoveries)(Brief article)
April 2, 2007... MALAYSIA -- Australia's BHP Billiton has been awarded two ultra-deepwater blocks located off the coast of Sabah, adjacent to a string of big deepwater discoveries including Kikeh, Gumusut and Ubah. Operator BHP will hold 60% stakes in Blocks N...

Saudi Arabia.(COUNTRIES)(Brief article)
April 2, 2007... SAUDI ARABIA -- Oil Minister Ali Naimi has been reconfirmed in his post along with the rest of the Saudi cabinet. A royal order released on Mar. 22 renewed the terms of all current members of the Council of Ministers for another four years,...

Spain.(COUNTRIES)
April 2, 2007... SPAIN -- The takeover battle for power giant Endesa intensified last week after Germany's E.On upped its bid to [euro] 40/share ($53.12), prompting another broadside from rival joint bidders Italy's Enel and Spanish construction firm Acciona...

Syria.(COUNTRIES)
April 2, 2007... SYRIA -- Damascus has invited international oil companies to submit offers on seven onshore exploration blocks by Jul. 12. None of the acreage is new, however, with four of the blocks being offered in the fifth licensing round in 2005, in which...

Turkey.(COUNTRIES)
April 2, 2007... TURKEY -- Ambitious plans to turn the southern Turkish port of Ceyhan into a regional energy hub will get a boost from plans by state Indian Oil Corp. (IOC) and Turkey's Calik Enerji--possibly joined by Kazakshtan's state Kazmunaigas--to build...

United States.(COUNTRIES)(Brief article)
April 2, 2007... UNITED STATES -- Higher US crude imports from Canada and Saudi Arabia are making up for lower volumes from Mexico and Venezuela, according to data from the Energy Information Administration. Compared to last year, imports in the first month of...

Gulf Jitters.(Marketview)
April 2, 2007... WASHINGTON -- US benchmark West Texas Intermediate (WTI) for April rolled off the board at $56.73/bbl on Mar. 20. Just a week later, the May contract soared to above $68/bbl, making a jump of around $5 in a matter of minutes on panic buying...

Industry slated again on safety.(Brief article)
April 2, 2007... A fifth report into the December 2005 explosion at the UK's Buncefield oil depot has drawn parallels with the fatal explosion at BP's Texas City refinery in the US which killed 15 people and injured 180 more in March 2005. The report drafted by...

PIW market indicators.(Petroleum Intelligence Weekly)(Statistical table)
April 2, 2007... PIW Market Indicators Last 2 Weeks 4 Weeks Spot Crude Week Ago Ago Opec Basket $60.68 $57.31 $57.85 UK Brent (Dtd.) $64.25 $61.28 $60.54 UK...

Global oil reserves fail to grow.
April 2, 2007... Global oil reserves failed to grow last year despite high oil prices and big increases in upstream expenditures, marking a continuation of the 2005 pattern. These sobering conclusions emerge from a new assessment of global liquids reserves...

The top 20 league standings.
April 2, 2007... The membership in the Top 20 list is predictable, but the rankings themselves contain some surprises. The top half of Opec's newly expanded membership accounts for six of the top 10, and the remainder, except for now net importer Indonesia but...

More about HIS data.(Petroleum Economics and Policy Solutions)
April 2, 2007... The reserves assessments presented in this supplement are based on historical data provided to PIW by IHS and its Petroleum Economics & Policy Solutions (PEPS) service. IHS is a leading global provider of technical information, decision-support...

Trade seeks alternatives to ailing benchmark.(West Texas Intermediate)
April 9, 2007... History has become a bad guide in pricing crude off troubled US benchmark West Texas Intermediate (WTI). Following months of weakness, WTI's fragile outright price collapsed last week as storage tanks in the US Midwest overflowed. WTI's spread...

New maintenance model lifts US refining margins.
April 9, 2007... A combination of unplanned refinery outages and scheduled maintenance in the US has resulted in robust refining margins so far in 2007 that have exceeded even last year's record highs. Refining executives say this is no short-term phenomenon...

New wave poses challenge for old independents.
April 9, 2007... Independent oil companies that survived the consolidation of the late 1990s are today faced with a different but still challenging global oil business. Although high oil prices have provided a more benevolent macro environment, the independents...

Second quarter holds few fears for Opec.
April 9, 2007... With the start of the second quarter, oil markets are again facing the enigma of rising crude demand, falling product demand, and a high degree of uncertainty about refinery and upstream operating performance. This is all set against the...

Shell buys time to tackle leadership issue.
April 9, 2007... Following the hurried succession forced on it by circumstance in 2004, it's hardly surprising that Royal Dutch Shell wants to wait a little longer before its next change in leadership. But the one-year postponement in Jeroen van der Veer's...

Social spending puts pressure on PDV finances.
April 9, 2007... National oil company finances should be in the rudest of health after two years of strong oil prices, but that's not how things look in Venezuela. There, state Petroleos de Venezuela (PDV) is being pulled in two directions--on one hand,...

Asian biodiesel plays catch up, makes inroads.
April 9, 2007... Asia faces a conundrum--how to meet rising oil demand and make transport fuels cleaner at the same time. The answer could lie with biodiesel, which can not only substitute for automotive diesel, but reduce sulfur content as well. Based mostly...

Corporate.(GENERAL)(Brief article)
April 9, 2007... CORPORATE -- Gas volumes from the Pearl gas-to-liquids project in Qatar accounted for more than half of Royal Dutch Shell's reserves bookings in 2006, and boosted the supermajor's overall reserves replacement ratio from 64% to 153%, according...

Formula Prices.(GENERAL)(crude exports)(Brief article)
April 9, 2007... FORMULA PRICES -- Saudi Arabia adjusted its May formula prices by tightening discounts for all crude exports to the US and Europe, but Asian differentials were a little mixed. Asian lifters will pay more for heavier grades, whose differentials...

Industry Restructuring.(GENERAL)
April 9, 2007... INDUSTRY RESTRUCTURING -- Royal Dutch Shell has secured more than 90% of the minority-held shares in its Shell Canada affiliate, enabling the company to acquire the remaining shares compulsorily and complete its $7.5 billion buyout by the end...

Angola.(COUNTRIES)
April 9, 2007... ANGOLA -- Italy's Eni is to take a 13.6% stake in the Angola LNG project, just weeks after Exxon Mobil agreed to hand back a stake of the same size to state Sonangol. With shareholdings seemingly finalized and new fiscal terms on production...

Australia.(COUNTRIES)(US Hess makes successful bid)(Brief article)
April 9, 2007... AUSTRALIA -- US Hess has made its debut in the upstream via a successful US$408 million bid for acreage near Chevron's giant Jansz gas field in the country's latest bid round. Twelve exploration blocks were offered, with the hottest competition...

China.(COUNTRIES)
April 9, 2007... CHINA -- China National Offshore Oil Corp. (CNOOC) saw its oil and gas production rise last year, but volumes fell short of expectations because of unplanned field shut-ins. Oil output rose 4% to 373,000 b/d, while gas output climbed 26% to 490...

France.(COUNTRIES)(inquiries into TOTAL S.A.'s dealings in Iran and Iraq)(Brief article)
April 9, 2007... FRANCE -- Total Chief Executive Christophe de Margerie has said he would accept being questioned if the US launches inquiries into the company's dealings in Iran and Iraq. De Margerie also confirmed the French major had paid $40 million to an...

India.(COUNTRIES)
April 9, 2007... INDIA -- Petronet LNG, the country's largest LNG importer, has expressed concern over whether Australia's Gorgon project will be ready to start supplying its Kochi terminal in time for the terminal's planned 2010 start-up. Petronet and Gorgon...

Kuwait.(COUNTRIES)
April 9, 2007... KUWAIT -- Kuwait Petroleum Corp. (KPC) Chief Executive Hani Hussein has told KPC staff that he will officially depart the company on May 1, four months before the end of his current term, according to KPC sources. The official announcement,...

Libya.(COUNTRIES)
April 9, 2007... LIBYA -- Germany's RWE has announced a second oil find in its 100% owned Sirte Basin Block NC-193. The B1-NC193 well encountered two oil bearing reservoirs and tested at 933 b/d, RWE said. Drilling on a third well was to have started by the...

Nigeria.(COUNTRIES)(oil blocks offer)(Brief article)
April 9, 2007... NIGERIA -- The government is offering up to 44 blocks in its last licensing round before elections scheduled for Apr. 21, but could reserve up to 17 blocks for companies planning to invest in infrastructure and refinery projects. These firms...

Qatar.(COUNTRIES)(product shipment of Oryx GTL)(Brief article)
April 9, 2007... QATAR -- The much-delayed Oryx gas-to-liquids project has postponed its first product shipment until later this month in the latest in a series of setbacks for the project (PIW Sep.25,p6). "We have a number of different entities...

Crude exports to destinations outside of the CIS dipped to 3.887 million b/d (16.439 million metric tons) in March, down from 3.948 million b/d in February.(COUNTRIES)
April 9, 2007... RUSSIA -- Crude exports to destinations outside of the CIS dipped to 3.887 million b/d (16.439 million metric tons) in March, down from 3.948 million b/d in February. The fall was largely due to a significant drop in the flows through Russia's...

A joint venture of Italy's Eni and Enel presented the winning bid of $5.83 billion for a 20% stake in Gazprom's Gazprom Neft oil subsidiary in liquidation auctions for bankrupt Russian oil company Yukos.(COUNTRIES)
April 9, 2007... RUSSIA -- A joint venture of Italy's Eni and Enel presented the winning bid of $5.83 billion for a 20% stake in Gazprom's Gazprom Neft oil subsidiary in liquidation auctions for bankrupt Russian oil company Yukos. The Italian EniNeftegaz...

United States.(COUNTRIES)
April 9, 2007... UNITED STATES -- The Supreme Court has rejected the Bush administration's long-standing view that it cannot regulate carbon dioxide (C[O.sub.2]) and other greenhouse gas emissions under the Clean Air Act (CAA), a verdict that could help reshape...

E.On bows out of Endesa power struggle.(What's New Around the World)
April 9, 2007... German energy giant E.On has withdrawn its [euro]42 billion ($57 billion) offer for Spanish power firm Endesa after striking a deal with its two rival bidders--Italy's state power firm Enel and Spanish construction firm Acciona--to split...

Fear premium.(Marketview)
April 9, 2007... NEW YORK -- Iran's seizure of 15 British sailors in the Mideast Gulf two weeks ago spooked oil markets much more than an earlier standoff with the United Nations over the country's nuclear program. As London and Tehran traded accusations, the...

DME approves members, vacant seats remain.(Marketview)
April 9, 2007... Some 28 applicants have so far been approved as members of the Dubai Mercantile Exchange (DME), including 17 of the 50 seats allocated for off-floor membership, and a further 11 firms approved as clearing members, the DME said last week....

PIW market indicators.(Petroleum Intelligence Weekly)(Financial report)
April 9, 2007... PIW Market Indicators Last 2 Weeks 4 Weeks Spot Crude Week Ago Ago Opec Basket $63.64 $61.58 $57.12 UK Brent (Dtd.) $68.75 $66.08 $61.02 UK...

Total boss stresses need for realism.(Christophe de Margerie)(TOTAL S.A)
April 16, 2007... If all publicity is good publicity, it may be no bad thing to be hauled in by the police and then quizzed for 36 hours about your company's dealings in Iran. Total's new chief executive, Christophe de Margerie, has had such an experience twice,...

'Gas Opec' faces challenge of logistics.
April 16, 2007... While much of what came out of last week's Gas Exporting Countries Forum (GECF) in Qatar was predictably vague, the members sent a clear message they had no intention of setting up an Opec-like group to fix gas prices--at least not at the...

US still learning 1970s energy security lessons.
April 16, 2007... Although the sustained high oil prices of the past few years are not directly comparable to the price shocks of 1970s, the US can look at that period for guidance on how to manage some of the risks created by today's oil market environment. The...

Reliance alliance bears fruit for Chevron.
April 16, 2007... The groundbreaking partnership agreed last year between Chevron and India's private sector Reliance Industries seems to be growing in scope by the day, with what began as a strategic investment in Indian refining set to extend to exploration,...

Tullow's Ugandan adventure piques investor interest.
April 16, 2007... Investors looking for the oil sector's next big exploration success story have recently been keeping a close eye on Tullow Oil. With its $1.15 billion acquisition of Australian rival Hardman Resources, the UK independent secured full control of...

In situ issues mean Canada's thinking small.
April 16, 2007... Canadian oil sands developers have historically relied on megaprojects and associated economies of scale to keep per-barrel costs competitive with other oil sources. While this works well enough for what are essentially mining ventures, a...

CEO interview: Total's Christophe de Margerie.(Interview)
April 16, 2007... In his first interview since being questioned by French financial police in March, Total Chief Executive Christophe de Margerie speaks to PIW about the challenges of doing business in difficult environments, which he sees as an inescapable...

Corporate.(GENERAL)(cases against Royal Dutch-Shell PLC by shareholders)(Brief article)
April 16, 2007... CORPORATE -- Royal Dutch Shell has agreed to pay $352.6 million plus costs to settle lawsuits brought by non-US based shareholders in connection with its 2004 reserves overbooking scandal, and will offer a further $80 million to settle separate...

Environment.(GENERAL)
April 16, 2007... ENVIRONMENT -- ConocoPhillips has become the first US oil company to support a group of big businesses and nonprofit environmental organizations seeking speedy enactment of legislation to curb greenhouse gas emissions. The US major is throwing...

IEA.(GENERAL)(International Energy Agency suspects sulfur standards)
April 16, 2007... IEA -- Departing from its normal oil market balance turf, the International Energy Agency has raised a somewhat controversial issue on the oil market implications of environmental standards on sulfur. Ever-tighter specifications on diesel...

China.(COUNTRIES)(earnings of Refiner Sinopec)(Financial report)(Brief article)
April 16, 2007... CHINA -- Refiner Sinopec posted a 30% increase in net profit for 2006, with earnings boosted by a fall in crude feedstock prices in the fourth quarter. Despite a full-year loss of $3.09 billion in its refining segment, total net profit was...

Equatorial Guinea.(COUNTRIES)
April 16, 2007... EQUATORIAL GUINEA -- The government is bidding for all the oil assets in the country being sold by US independent Devon Energy, and says it may also bid for the other West African upstream assets the company has put up for sale. "The government...

Indonesia.(COUNTRIES)
April 16, 2007... INDONESIA -- Perusahaan Gas Negara (PGN) plans to build the country's first LNG receiving terminal in Situbondo, East Java, sourcing domestic supplies from BP's Tangguh project, the proposed Donggi LNG plant and the Bontang LNG plant. PGN's...

Libya.(COUNTRIES)(State National Oil Corp. aims for better production)(Brief article)
April 16, 2007... LIBYA -- State National Oil Corp. head Shokri Ghanem has cast doubt on whether a bid round will be held for development and production sharing agreements (DPSA) aimed at increasing the country's oil production. There had been no decision yet...

Papua new Guinea.(COUNTRIES)
April 16, 2007... PAPUA NEW GUINEA -- Exxon Mobil and Australian firms Santos and Oil Search have begun a formal study into building the country's first LNG plant. The consortium is considering development of a 5 million-6.5 million ton/yr LNG facility,...

Disagreements over possible reparations for environmental damage could further delay state Gazprom from taking its majority stake in the Sakhalin-2 LNG project on Russia's Pacific shelf. The $7.45 billion transaction was due to be finalized by the end of March.(COUNTRIES)
April 16, 2007... RUSSIA -- Disagreements over possible reparations for environmental damage could further delay state Gazprom from taking its majority stake in the Sakhalin-2 LNG project on Russia's Pacific shelf. The $7.45 billion transaction was due to be...

State Rosneft looks set to walk away with the two major lots remaining in the liquidation auction of bankrupt oil company Yukos. Rosneft has only to agree how to divide the booty with state gas giant Gazprom.(COUNTRIES)
April 16, 2007... RUSSIA -- State Rosneft looks set to walk away with the two major lots remaining in the liquidation auction of bankrupt oil company Yukos. Rosneft has only to agree how to divide the booty with state gas giant Gazprom. The Yukos creditors'...

Tunisia.(COUNTRIES)
April 16, 2007... TUNISIA -- Qatar Petroleum (QP) has won a contract to build a new $2 billion, 120,000 b/d refinery at La Skhira. "Qatar has received a letter of intent from the Tunisians and was selected to proceed," Qatar Petroleum International Chief...

UAE.(COUNTRIES)
April 16, 2007... UAE -- Abu Dhabi's International Petroleum Investment Co. (Ipic) is planning to build a second grassroots refinery in Pakistan, to add to the Pak-Arab Refinery Co. (Parco) plant it owns jointly with the Pakistani government. The new refinery,...

The California State Lands Commission.(COUNTRIES)(BHP Billiton denied lease)(Brief article)
April 16, 2007... UNITED STATES -- The California State Lands Commission has dealt a substantial blow to the controversial Cabrillo Port LNG terminal that Australia's BHP Billiton is proposing to build 14 miles off the state's coast. The commission decided not...

The Energy Information Administration (EIA).(COUNTRIES)(forecasting of gasoline prices)(Brief article)
April 16, 2007... UNITED STATES -- The Energy Information Administration (EIA) is forecasting gasoline prices to be only slightly lower this summer than last year. The EIA expects summer retail gasoline prices--from April through September--to average...

Venezuela.(COUNTRIES)
April 16, 2007... VENEZUELA -- Caracas will sign an agreement with Algeria next month for the construction of a projected $10 billion pipeline to carry Venezuelan gas to Brazil and Argentina and a $2 billion LNG terminal. A government delegation is scheduled to...

Slow exploration threatens Russia's Asia crude line.
April 16, 2007... Russia's Natural Resources Ministry is seriously concerned that insufficient investment in exploration in East Siberia could delay the construction of the second phase of an oil pipeline to the Pacific coast to supply Asian markets. The...

Refiners' party.(Marketview)
April 16, 2007... NEW YORK -- Refining margins in the US and Europe sparked last week, led by jumping gasoline prices, as heavy refinery maintenance on both sides of the Atlantic continued and unexpected outages hit an already tight gasoline market. The snafus...

US regulator blocks Western-Giant refining deal.(Brief article)
April 16, 2007... The US Federal Trade Commission (FTC) is seeking an injunction to prevent Western Refining's $1.5 billion acquisition of rival refiner Giant Industries because the combination would stifle competition in New Mexico (PIW Sep.4,p6). The deal...

PIW market indicators.(Petroleum Intelligence Weekly)(Statistical table)
April 16, 2007... PIW Market Indicators 1 Week 2 Weeks 4 Weeks Spot Crude Ago Ago Ago Opec Basket $63.19 $63.73 $57.31 UK Brent (Dtd.) $67.88 $68.64 $61.28 UK...

Gazprom's arrival changes outlook for Sakhalin gas.
April 23, 2007... Gazprom's forced entry into the Sakhalin-2 project, finalized last week in a $7.45 billion deal with Royal Dutch Shell and its partners, should secure a relatively trouble-free future for a key new source of global energy supply. The Japanese...

Analysts see oil over $60 for 2007, split on Q4.(prices of petroleum products in 2007)
April 23, 2007... If forecasting the oil price isn't hard enough, market analysts now have to contend with a weakened West Texas Intermediate (WTI) benchmark seemingly disconnected from international markets. This is on top of other tough-to-quantify factors...

Conoco joins big oil's green awakening.
April 23, 2007... Big Oil, for so long the bete noire of the green lobby, could soon be making itself a much trickier target for environmentalists. The reason is that many of the major oil companies have begun adopting a different, more engaged stance with...

Norway makes case for Snohvit oil.
April 23, 2007... As Norway dismantles its massive Frigg gas field infrastructure in the western North Sea and prepares to bring on stream its first major LNG project, Snohvit in the Barents Sea, a controversy has emerged over what to do with the thin oil layers...