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Posts on ‘September 12th, 2006’

MarketWatch: Problematic BP a buy, for some

Lord Browne

Gulf of Mexico exposure, recent share price fall spells opportunity, some say
By Steve Goldstein, MarketWatch
Last Update: 7:00 PM ET Sep 12, 2006

LONDON (MarketWatch) — BP plc has a busted pipeline in Alaska.

It’s facing probes into a shoddy safety record and allegations of trading manipulations, has a lame-duck chief executive and generates a quarter of its annual production from a country that has seized one rival’s assets and allegedly forced BP to invest in another.

The advice from a large chunk of the sell-side community? Buy. read more

MarketWatch: Shell CEO says it’ll take time to ramp up Nigeria oil output

Sept 12, 2006

LONDON (MarketWatch) — Royal Dutch Shell PLC (RDSB.LN) will take time to ramp up its Nigerian oil production following militant attacks in the Niger Delta, Chief Executive Jeroen van der Veer said Tuesday.

Van der Veer said the Anglo-Dutch oil major’s priority “is to create a situation that is safe for our staff to return” to work “in cooperation with local communities, local governments, (and) the Abuja government.”

About 872,000 barrels a day of Nigerian oil production has been shut in as a result of militant attacks and damaged pipelines. Slightly more than half of that output comes from Shell’s E.A. platform and Forcados oil terminal, which together produce 477,000 b/d. read more

The Moscow Times: $10Bln Behind Oil Difficulties

Wednesday, September 13, 2006. Issue 3496. Page 4.

By Miriam Elder
Staff Writer

Natural Resources Minister Yury Trutnev acknowledged Tuesday that financial concerns were driving the government’s attempt to revoke approval for Sakhalin-2, a $20 billion oil project led by Royal Dutch Shell.

The government was forced to act because it will lose $10 billion if the project goes ahead, Trutnev said.

It cannot accept “the operator’s plans to write off additional expenditures and to push back the time of production sharing,” he said. read more

Leaked Royal Dutch Shell Internal Email from Tom Botts: Kieron McFadyen to head Royal Dutch Shell HSE

EP Europe leadership team change


Kieron McFadyen to head Royal Dutch Shell HSE


I want to make you aware of an important announcement going on the Shell Wide Web today. I am pleased to announce Kieron McFadyen has been appointed as Vice President, HSE, Royal Dutch Shell, effective November 1. 

This role, which is a new focused position in the Group, reinforces Shell’s commitment to improve our global HSE performance. He will be based in The Hague. Kieron has played a key role in EPE from the very start and in addition to managing the large technical directorate, he has been instrumental in maintaining strong external stakeholder relationships thoughout the north east of Scotland and the UK. read more

RIA Novosti (Moscow): Russia’s minister warns of losses in Sakhalin II project

Sakhalin II

RIA Novosti (Moscow): Russia’s minister warns of losses in Sakhalin II project

18:19 | 12/ 09/ 2006 

MOSCOW, September 12 (RIA Novosti) – Russia could lose $10 billion in the Sakhalin II oil and gas project if operators continue to increase expenses, Russia’s natural resources minister Tuesday.

The Sakhalin II project, which is run by the Sakhalin Energy Investment Company and controlled by Royal Dutch Shell, has had a history of controversy since its inception. In the latest challenge to its viability, development costs have reportedly doubled to about $20 billion as global commodity prices have risen. read more

AFX News: Lines form for gas before Nigeria strike

Tuesday, September 12, 2006 11:41:00 AM

ABUJA, Nigeria (AFX) – Long lines formed at Nigerian gas stations Tuesday ahead of an oil-workers’ strike due to begin at midnight

The country’s two biggest petroleum-industry unions called the three-day action to protest the death of a member, killed in a shoot-out between government forces and militants in the restive, oil-rich south.

“There will be a comprehensive warning strike,” said Peter Akpatason, the head of the blue-collar workers union. He said his bloc and the white-collar union, which have a joint membership of around 20,000 Nigerians, would look to see if their concerns over security were being taken seriously before deciding on further action read more

ISN Security Watch (Moscow): Kremlin eyes Sakhalin hydrocarbon riches (MAJOR ARTICLE)

Russia’s ambitious plans to expand to Asia-Pacific energy markets see the island of Sakhalin as their cornerstone – and a battle ground against Western oil majors for greater state control.

By Sergei Blagov in Moscow for ISN Security Watch (12/09/06)

Russia’s Sakhalin projects have been seen as a cornerstone of Moscow’s ambitious plans to expand to Asia-Pacific energy markets. Meanwhile, the island of Sakhalin has emerged as a battleground for increased government control over international production-sharing agreements. read more

Dow Jones Newswires: Shell CEO: Sakhalin 80% Completed; Working To Standard -3

Tuesday September 12nd, 2006 / 14h10
Last week, Russia’s environmental watchdog Rosprirodnadzor said it would seek to revoke Sakhalin Energy’s environmental clearance for the second phase of its project to develop the oil and gas region known as Sakhalin-II after finding fault with the way Sakhalin Energy Ltd. has handled some environmental concerns.

Van de Veer said the consortium always seeks to comply with the exacting standards set for the project, and seeks to rectify any lapses when they happen. read more

UpstreamOnline: Nigeria unions firm on strike


(Downing tools in the delta: members of both the Pengassan and Nupeng unions are set to strike on Wednesday)

UpstreamOnline: Nigeria unions firm on strike

By Upstream staff

Nigerian oil unions said today there would be no going back on a three-day “warning strike” due to start on Wednesday, as they gathered for a last-gasp meeting with the government.

The two main unions, Pengassan and Nupeng, said talks with the labour ministry in the capital Abuja, due to start at 1300 GMT today, were coming too late to avert the planned protest over insecurity in the Niger Delta. read more

UpstreamOnline: Japan shrugs off Sakhalin 2 woes

By Upstream staff

A Japanese government official said today that the Sakhalin 2 liquefied natural gas development in Russia’s far east will come on stream despite opposition by the Russian environmental regulator.

Takao Kitabata, the vice minister of Japan’s Ministry of Economy, Trade & Industry, said that the Shell-led project would move ahead, according to a statement published on the ministry’s website.

“It is possible that (the project) may see problems at various stages of the construction process and one of them is happening now. But in the long term, it will move forward to completion,” Kitabata said. read more

UpstreamOnline: Nigerian Petroleum Minister Daukoru puts output loss at 872,000 bpd

 Nigerian Oil Minister Daukoru

By Upstream staff  

Nigerian Minister of State for Petroleum Edmund Daukoru has estimated the amount of oil shut in due to militant attacks and pipeline leaks at 872,000 barrels per day.

The figure appeared sharply higher than recent industry estimates of around 600,000 barrels per day shut in. Daukoru did not elaborate on the figure.

Nigeria was pumping at around 2.28 million bpd in August according to a Reuters survey.

Daukoru said production from Shell’s Forcados oil terminal and EA platform will restart within three to six months. About 477,000 barrels of oil equivalent per day production from those facilities have been shut-in since attacks in February. read more

UpsteamOnline: ‘Cost blow out prompted Sakhalin probes’

By Upstream staff
12 September 2006

Russian investigations into a Shell-led project are the result of a $10 billion cost overrun and are not part of a wider crackdown on foreigners, Natural Resources Minister Yuri Trutnev said today.

Last year Shell doubled the cost estimate for its huge Sakhalin 2 project off Russia’s Pacific coast to $20 billion, blaming high metals prices, inflation and the weak dollar.

But the hike in costs hits the Kremlin directly because Sakhalin 2 is a production sharing agreement, so the Russian state will have to wait twice as long before it gets any revenue from the project’s exports of oil and liquefied natural gas. read more

The Wall Street Journal: Oil News Roundup: September 11, 2006 4:25 p.m.

September 11, 2006 4:25 p.m.

Crude-oil futures fell for the sixth straight session, briefly trading below $65 a barrel on the New York Mercantile Exchange, before recovering a bit to settle 64 cents down at $65.61 — their lowest close since late March. Here is Monday’s roundup of oil and energy news.

* * *
OPEC LEAVES OUTPUT ALONE: As expected, the Organization of Petroleum Exporting Countries decided to stick with its official oil-production target of 28 million barrels a day. But the cartel’s output in recent months has fallen by as much as half a million barrels below that figure. And OPEC ministers will now watch the market carefully for signs that the recent decline in crude prices may be turning into a rout. If so, then OPEC members could decide to let their output slip further before the next cartel meeting. read more

Lloyds List: BG and Conoco to seek early development on major UK discovery

By: Discovery of up to 275m barrels of oil equivalent in the North Sea Shoei field is one of the UKs biggest gas condensate finds of the past decade, writes Martyn Wingrove, Lloyds List
Published: Sep 12, 2006

BG Group and Conoco-Phillips are targeting early development for one of the UK’s largest gas condensate discoveries for a decade.

The British gas firm and US oil major have found up to 275m barrels of oil equivalent reserves in the Shoei field in the central North Sea and have already drilled appraisal sidetracks. read more

Lloyds List: Husky gas find boosts Chinese activity

By: New enthusiasm from discovery in area previously given up as dry, writes Bruce McMichael, Lloyds List
Published: Sep 12, 2006

CHINA’S offshore exploration was given a huge boost by a deepwater gas discovery announced earlier this year by Canada’s Husky Energy.

The discovery in the South China Sea some 150 miles south of Hong Kong comes decades after this remote area was given up as devoid of hydrocarbons, so has stirred up new exploratory interest offshore China.

Fu Chengyu, chairman of Husky’s Chinese partner in the area China National Offshore Oil Corp, calls the gas discovery ‘a tremendous breakthrough for us.’ The find reportedly contains 3.5trn cu ft of gas, almost enough to fill one liquefied natural gas train. read more

Lloyds List: Chevron aims to hit Jack pot with record-breaking well

Published: Sep 12, 2006

CHEVRON is lining up another appraisal well on its Jack oil discovery as the latest Gulf of Mexico well breaks test records, writes Martyn Wingrove.

The US oil major wants to drill again on Jack, which lies in Walker Ridge block 758, in 2007 to delineate this potentially large oil field before making any development decision.

The latest appraisal well, drilled by Transocean’s semi-submersible Cajun Express, tested the Jack field at rates of more than 6,000 barrels of oil per day, confirming its flow potential. read more

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