September 6th, 2006:

EXTRACT: The news should boost the hopes of Shell and BP, which both own drilling leases in adjacent areas. Shares in Chevron, which owns 50pc of the well, and Statoil, which owns 25pc, rose around 3pc, while Devon, which owns the remainder, soared 12pc to an all-time high.

THE ARTICLE

By David Litterick in New York

(Filed: 06/09/2006)

Chevron said it had successfully tapped what could prove the largest deposit of crude oil ever discovered in the US.

The oil major broke half a dozen records during construction of the test well, which sits about 175 miles off the coast of Louisiana in the deep-water regions of the Gulf of Mexico. read more

By: Stephen Foley in New York, The Independent – United Kingdom
Published: Sep 06, 2006

One of the world’s biggest oil companies held out the prospect that the US could increase its domestic oil reserves by up to a half after unveiling positive results from drilling in the Gulf of Mexico yesterday.

Chevron said it had made significant progress in its exploration of a new oil field deep below the sea-bed, 270 miles south-west of New Orleans.

Industry analysts believe that the field could contain up to 15 billion barrels of oil and may overtake BP’s troubled Prudhoe Bay field in Alaska as the country’s largest. read more

MOSCOW, Russia (UPI) — Moscow appears ready to block a $20 billion natural gas project, led by the Royal Dutch Shell Group PLC, on the Pacific Ocean island of Sakhalin.

The formal reason is the Federal Service for the Supervision of Natural Resources, which says environmental recommendations of the project — the world`s largest integrated oil and natural gas venture — are ‘unfulfilled,’ the BBC reported Tuesday. The service wants the nation`s Natural Resources Ministry to repeal its approval of the project. read more

THE WALL STREET JOURNAL ONLINE
September 5, 2006 4:18 p.m.

Crude-oil prices tumbled to less than $69 a barrel on the New York Mercantile Exchange as worries about hurricane season and tensions with Iran ebbed and Chevron announced a potentially significant new deepwater source of oil in the Gulf of Mexico. Here is Tuesday’s roundup of oil and energy news.

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EXPLORATION DEAL: As the oil-exploration industry absorbed Chevron’s news, it also reacted to news that French oil and gas field surveyor Compagnie Generale de Geophysique agreed to buy U.S. rival Veritas DGC Inc. for $3.1 billion in cash and stock. The deal establishes a major new global player in the booming oil-exploration industry. read more

September 5, 2006 4:19 p.m.

Send suggestions and tips to [email protected]. Find this feature every day at WSJ.com/marketbeat.

The oil sector struck gold, after news that Chevron and two partners made a significant discovery that could boost the nation’s oil reserves by as much as 50%. The yield from the test wells in the Gulf of Mexico is undeterminable at this point, but Chevron still gained 3% on the day, and other oil stocks rose as well, boosting the Oil Service Holdrs exchange-traded fund by 1.9% on the day. Crude oil finished down 59 cents to $68.60 on the news. read more

By MICHAEL CONNOLLY
September 6, 2006

RUSSIAN ENERGY: While OAO Gazprom’s decision to pay Turkmenistan more for natural gas will likely improve the reliability of supplies to Europe this winter, reducing prospects for a repetition of last winter’s disruption reductions with Ukraine, the deal further tightens Moscow’s grip on supplies from Central Asia.

Continuing the theme, efforts further east by Russia’s environmental regulator to revoke approval for a $20 billion international oil-and-gas project led by Royal Dutch Shell PLC on the Pacific island of Sakhalin could pressure Shell to offer Gazprom, Russia’s state-controlled gas monopoly, better terms as it jostles to join what will be the world’s biggest liquefied natural-gas development. read more

ASSOCIATED PRESS
September 5, 2006 4:00 p.m.; Page A10

Russia’s environmental regulator said it had filed suit seeking to revoke approval for a $20 billion international oil and gas project led by Royal Dutch Shell PLC on the Pacific island of Sakhalin.

The Federal Service for the Supervision of Natural Resources had signaled for several weeks that it planned to ask the Natural Resources Ministry to withdraw its approval for the Sakhalin II project in Russia’s Far East. The service said the suit was filed due to “unfulfilled recommendations, details of which are included in the state ecological review, and multiple digressions,” along with project operators’ failure to take necessary measures against erosion. read more

CBS News: Oil Companies Look For Homegrown Reserves At The Bottom Of The Sea

Sept. 5, 2006

(CBS) Chevron announced on Tuesday a record-breaking strike in the Gulf of Mexico. But it’s not the only oil company looking for oil closer to home.

“If the technology can keep up with it, there’s more reserves to be had there,” said Marvin Odom, Shell Oil’s VP for exploration and production.

Last week, Shell flew CBS News correspondent Anthony Mason and crew to the Ram-Powell, a 46-story structure floating 80 miles out in the Gulf to see the newest well the company is drilling. read more

Oil company has secured a permanent MasterCard merchant service fee reduction for its branded operators.

Shell Oil Products said it recognizes that the rising cost of gasoline is crushing fuel margins and it is offering its branded marketers a break.

To ease costs for its branded marketers, the Houston-based refiner-marketer has negotiated a permanent MasterCard merchant service fee reduction for its branded operators, effective immediately. The permanent fee is being reduced from 2.10% plus 10 cents to 2% plus 10 cents. read more

By Andrew Dewson
Published: 06 September 2006

It looks like traders are taking the scattergun approach in attempting to predict Shell’s corporate strategy. The oil giant was linked to no fewer than three takeover targets yesterday – Centrica, BG Group and Premier Oil.

So far, Shell has only confirmed it is “taking advice” on a possible bid for Premier Oil, the FTSE 250-listed oil exploration and production group with assets in Europe, Africa and south Asia. Traders said Shell bidding for Centrica would make a more palatable deal for British regulators after the Russian group Gazprom signalled its interest in Centrica six months ago. BG would be, by a considerable distance, the biggest deal of the three, with a market capitalisation approximately 2.5 times larger than that of Centrica and more than 20 times greater than Premier’s. read more