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Posts on ‘October 4th, 2006’

Reuters: Russia tells Dutch will start talks with Shell soon

Wed Oct 4, 2006 2:09pm ET

AMSTERDAM, Oct 4 (Reuters) – Two Russian ministries assured Dutch Economy Minister Joop Wijn on Wednesday that Moscow will soon start talks with Shell (RDSa.L: Quote, Profile, Research) to try to resolve the crisis over the Sakhalin-2 project, Wijn’s spokesman said.

Russian Deputy Energy Minister Andrei Reus and Economy Minister German Gref told visiting counterpart Wijn that Russia wanted to solve disagreements with Shell over the project’s costs and environmental impact, Wijn’s spokesman Job Frieszo said.

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Associated Press: Militants say 9 dead in attacks in Nigerian oil-rich southern delta

Wednesday October 04, 2006
Associated Press Writer

PORT HARCOURT, Nigeria (AP) Militants battled security forces in Nigeria’s oil-rich southern delta Wednesday after armed men attacked a oil company convoy and a pumping station, officials said.

Militants said in an e-mail that nine people were killed in fighting with government forces in fighting at the pumping station belonging to a Royal Dutch Shell PLC subsidiary.

(Copyright 2006 by The Associated Press. All Rights Reserved.) Oil Rebounds As Fighting Flares In Nigeria

8:38 am, Thursday 05 Oct 2006 
Oil prices have rebounded after fighting between rebels and government troops in oil exporting country Nigeria.

U.S. crude rose 73 cents to $US59.41 a barrel, after falling to an 8-month low of $US57.75. London Brent rose 79 cents to $US59.22.

Nigerian rebels and troops were engaged in a fight near an oil pumping station operated by Royal Dutch Shell in the eastern part of the Niger Delta on Wednesday.

© NewsRoom 2006

RIA Novosti: Environmental violations on Sakhalin

18:34 | 04/ 10/ 2006

YUZHNO-SAKHALINSK-MOSCOW. (RIA Novosti commentator Tatyana Sinitsyna)

“I have seen so many gas and oil pipelines in different countries, but I have never witnessed the construction methods used by the Sakhalin Energy company in Russia,” said Deputy Director of Russia’s Federal Service for Environmental Supervision (FSES or Rosprirodnadzor in Russian abbreviation) Oleg Mitvol, addressing a news conference in Yuzhno-Sakhalinsk.

“There is no doubt that the project should be stopped, and the damage to the environment rectified — illegal deforestation, sand-up streams, and river banks which have not been properly fortified.”

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Reuters: At least 5 foreign oil workers abducted today in Nigeria

Wednesday October 4, 2006
By Tom Ashby
LAGOS – Suspected militants invaded a residential compound for foreign oil workers in Nigeria today, killing two guards and kidnapping at least five expatriates, oil industry sources said.
The workers — including three Britons and two Malaysians — were taken from the compound in Eket, close to the operational base of ExxonMobil, which exports about 800,000 barrels a day from Africa’s top oil producer.
The two security guards killed in the raid were believed to be Nigerians, the sources added.
“The incident took place at Eseakpan residential area for service companies in Eket. Two civilian guards were killed. Three British and two Malaysians were among those kidnapped,” one oil industry source said.
A spokeswoman for ExxonMobil said she had no information about the attack. Earlier reports had indicated that between seven and 11 expatriates had been abducted.
Yesterday, about 25 Nigerian staff of a Royal Dutch Shell contractor were abducted and at least 10 soldiers were believed to have been killed in a militant raid on a convoy of boats supplying oilfields in a different part of the delta.
About 70 gunmen in speed boats attacked the barges carrying fuel and other supplies to Shell facilities in the remote Cawthorne Channel in Rivers state in the Niger Delta.
Industry sources said there were two other raids, possibly by the same group, on oil industry boats in the same area, also yesterday, in which one more soldier was killed and several rifles were seized.
The series of attacks ended a period of relative quiet in the Niger Delta, which accounts for all oil output from the world’s eighth biggest exporter. One sixth of Nigeria’s production capacity has been shut down since February following a wave of militant attacks on oil facilities that month.
The militant group behind February’s attacks, the Movement for the Emancipation of the Niger Delta, said it was not involved in yesterday’s raids. However, in a statement today, it said it had moved fighters into Rivers state to defend communities from reprisal attacks by the military.
“We will not stand with folded arms while the Nigerian military, true to habit, inflicts retaliatory punishment on innocent civilians,” the group said in an email statement.
“These fighters will remain in the vicinity of Rivers state, until the perceived threat to Ijaw communities in Rivers state ceases to exist,” it added, in reference to the Ijaw tribe which is the largest ethnic group in the delta.
Supply disruptions from Opec member Nigeria have contributed to several spikes in world oil prices this year.
Yesterday’s attacks did not affect production as they occurred on a river away from any facilities, company sources said.
The Niger Delta was relatively quiet in September after a series of kidnappings for ransom in August. A total of 18 oil workers were abducted that month in eight separate incidents. One of the hostages was shot dead by troops during a botched attempt to free him, while all the others have been freed.
Violence in the delta is rooted in poverty, corruption and lawlessness. Most inhabitants of the wetlands region, which is almost the size of England, have seen few benefits from five decades of oil extraction that has damaged their environment.
Resentment towards the oil industry breeds militancy, but other factors such as the struggle for control of a lucrative oil smuggling business and the lure of ransoms also lie behind the violence.

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Radio Free Europe : CIS: Region’s IPOs Attracting Interest Despite Sakhalin Dispute

Mikhail Khodorkovsky, formally CEO of Yukos

(Former Tukos CEO, Mikhail Khodorkovsky, in the frame.)

LONDON, October 4, 2006 (RFE/RL) — Companies from all over the world head to the London Stock Exchange when they need to attract international investment and raise development capital.

Firms from Russia and elsewhere in the CIS are among the latest to head to London to launch initial public offerings (IPOs) — their first sale of stock to the public.

Interest In Russia, Kazakhstan

Earlier this summer, Russia’s Rosneft oil company earned upward of $10 billion in its London IPO, launched on July 19.

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Arkansas Democrat-Gazette: Shell chief: …Shell is proud of the job it’s done in Nigeria

Headline: Finding resources key

Posted on Wednesday, October 4, 2006

As president of Shell Oil Co., John Hofmeister is a natural target for some of the most oftenasked questions in the energy industry:

Why are fuel pump prices so up or down ? And how is the oil industry spending some of the record profits it has recently reaped to make energy more affordable for average Americans ?

During a Tuesday address at the University of Arkansas ’ Clinton School of Public Service, Hofmeister set out to answer those questions, as well as explain how vital it is for government and industry to help energy producers meet growing U. S. demand in an increasingly competitive global market.

read more 16 hostages freed in Nigeria

04/10/2006 14:52  – (SA)  

Lagos – Niger Delta militants on Wednesday released 16 remaining oil employees of a sub-contractor to Anglo-Dutch oil giant, Shell, two days after kidnapping a group of workers, said an industry spokesperson.

According to the spokesperson: “I can confirm that the remaining hostages were released this morning. They were 24 or so in number. Nine were released yesterday.”

On Monday, about 70 men attacked a site belonging to the Royal Dutch Shell company in neighbouring Rivers State, killing 14 soldiers and kidnapping 25 workers.

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Reuters: UPDATE 2-Kremlin says not trying to oust foreign oil majors

Wed Oct 4, 2006 8:59 AM ET
(adds quotes, Gazprom on Sakhalin-2, Exxon Sakhalin-1 loading)

By Elif Kaban

MOSCOW, Oct 4 (Reuters) – Russia is not seeking to oust foreign oil majors operating big production-sharing agreements (PSAs), but will not agree to massive cost overruns at these projects, a Kremlin official said on Wednesday.

Arkady Dvorkovich, head of the Kremlin’s economic research department, said Russia was particularly concerned by Royal Dutch Shell’s request last year to allow it to double costs to $20 billion at its Sakhalin-2 oil and gas project.

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Reuters: Shell says all abducted staff in Nigeria released

04 Oct 2006 10:05:42 GMT
Source: Reuters

LONDON, Oct 4 (Reuters) – All Royal Dutch Shell workers kidnapped in Nigeria this week have been freed by their captors, a company spokeswoman said on Wednesday.

Attackers abducted about 25 Nigerian staff of a Shell contractor on Monday following a raid on a convoy of boats supplying oilfields.

“All the contractors have been released,” the Shell spokeswoman said.

Bloomberg: Eni’s Kazakh Project, Cornerstone of Growth, Delayed (Update1)

By Eduard Gismatullin and Nariman Gizitdinov

Oct. 4 (Bloomberg) — Eni SpA and partners in the Kashagan oil field in Kazakhstan, the biggest discovery in three decades, risk years of delays because of design changes and extra costs.

The $29 billion project will miss its target of pumping oil in 2008 and the development will run over budget, the venture partners and Kazakh officials said. Kazakhstan, which is among the top 10 countries in terms of oil reserves, needs to tap the field to meet its goal of almost tripling production by 2015.

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Bloomberg: Japan Aims to Beat Shell, Sasol With GTL Technology (Update1)

By Megumi Yamanaka

Oct. 4 (Bloomberg) — Inpex Holdings Inc. and five other Japanese companies are joining to develop gas-to-liquids technology, aiming to cut plant building costs and enabling them to beat GTL front-runners Royal Dutch Shell Plc and Sasol Ltd.

The Japanese companies will build a demonstration plant and develop gas-to-liquids capability by the end of the five years ending March 2011, they said in a statement today. The partners want to make the technology to build commercial plants available in 2012.

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Bloomberg: ConocoPhillips May Join Shell to Explore Kazakh Oil Field

By Nariman Gizitdinov and Eduard Gismatullin

Oct. 4 (Bloomberg) — ConocoPhillips, the third-largest U.S. oil company, is in talks with the Kazakh government about joining an offshore exploration project in the Caspian Sea that is already being sought by Royal Dutch Shell Plc.

The two companies are seeking stakes in the Nursultan oil fields, which may hold 637 million tons (4.7 billion barrels) of oil and gas reserves, according to KazMunaiGaz, Kazakhstan’s state oil company. Shell may gain 35 percent of the field, Kazakh Energy Minister Baktykozha Izmukhambetov said in June.

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Associated Press: Kremlin Turns Up Heat on Shell Project

Oct. 4, 2006, 5:13AM

© 2006 The Associated Press

MOSCOW — The Kremlin turned up the pressure on a giant Shell-lead energy project Wednesday after a top economic adviser to the president said Russia would never accept a doubling of its costs, the Interfax news agency reported.

“It was clear that the Russian side would never accept this,” Arkady Dvorkovich was quoted as saying. Shell enraged the Kremlin last year when it announced that its costs at the giant Sakhalin-2 liquefied natural gas project would double to US$20 billion (euro15.75 billion).

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Bloomberg: Russia to Reject Shell Sakhalin Budget Request (Update1)

By Lucian Kim

Oct. 4 (Bloomberg) — The Russian government won’t approve Royal Dutch Shell Plc’s request to increase the budget for its Sakhalin-2 oil and gas venture, which has been threatened with delays amid calls for a greater local role in the country’s biggest foreign-run energy project.

Shell’s request to double to $20 billion spending on the project’s second phase is unacceptable, Arkady Dvorkovich, President Vladimir Putin’s top economic aide, said today in Moscow. Shell can resolve the budget question by sticking to the original production-sharing agreement, seeking to renegotiate the accord’s terms or by selling its stake in the venture, he said.

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Reuters: Sakhalin II $20 billion cost overrun

MOSCOW, Oct 4 (Reuters) – Russia is not seeking to oust foreign oil majors operating big production sharing deals, but will not agree to massive cost overruns at these projects, a Kremlin official said on Wednesday.

Arkady Dvorkovich, head of the Kremlin’s economic research department, said the state was particularly concerned by Royal Dutch Shell’s (RDSa.L: Quote, Profile, Research) request to allow it to double costs to $20 billion at its Sakhalin-2 project.

“It was obvious from the beginning that the Russian side would never agree with this,” he told a conference.

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The Guardian: Kremlin attack dog vows to take on Shell in the battle of Sakhalin

The struggle to wrest control of resources from western companies is the backdrop to tension in Russia and Africa

Tom Parfitt in Yuzhno-Sakhalinsk
Wednesday October 4, 2006

It was a face-off that seemed to encapsulate the growing conflict between a bullish Kremlin and the foreign oil companies working in Russia. On one side was Oleg Mitvol, 6ft 2in and dressed in a black coat, the Kremlin’s attack dog leading the charge against the vast Sakhalin-2 oil and gas development off Russia’s far east coast. Mr Mitvol has vowed to do “everything in his power” to stop the project and force an environmental clean-up. Against him: Mike D’Ardenne, 200lb bearded Australian oilman in a hard hat, representing the foreign consortium led by Shell which is running the $20bn (£11bn) project.

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The Wall Street Journal: Oil News Roundup: October 3, 2006 7:16 p.m.

October 3, 2006 7:16 p.m.

Crude-oil futures tacked a 4% slide onto Monday’s 3% haircut, settling at less than $59 a barrel on the New York Mercantile Exchange for the first time since February. Rising global supplies, slack demand and a mild Atlantic hurricane season have contributed to oil’s steep decline. Here is Tuesday’s roundup of oil and energy news.

* * *
CHEMOIL PULLS IPO: Chemoil Energy Ltd. said its initial public offering of up to $374 million in stock, set to be Singapore’s second-largest share sale this year, has been withdrawn. Chemoil, a U.S.-based marine-fuel supplier half-owned by Itochu Corp. of Japan, said it pulled the IPO “due to considerations relating to valuation.” Some market participants have said the recent fall in oil prices resulted in potential investors demanding a less-expensive valuation.

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The Wall Street Journal: Nigerian Militants Kidnap Foreign Oil Workers

Associated Press
October 3, 2006 7:20 p.m.

PORT HARCOURT, Nigeria — Security officials said militants kidnapped several foreign oil workers Tuesday in Nigeria’s oil-rich southern delta region, a day after 25 Nigerians were taken hostage in an attack on a military convoy escorting oil workers.

Police officers in the town of Ekit, outside the main city of Port Harcourt, said between four and seven foreigners were seized in the raid there, but they gave no details.

A top Nigerian security official confirmed the kidnapping, but also had no details. All the security officials spoke on condition of anonymity, citing prohibitions on speaking with the media.

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Lloyds List: Oil workers abducted in Nigeria

Published: Oct 04, 2006

SECURITY problems in the Niger Delta have escalated after 25 Nigerian workers were abducted during an attack on a convoy of barges, writes Martyn Wingrove .

Local militants attacked the service barges in the Cawthorne Channel, killing up to 10 soldiers and capturing offshore contractors working for Royal Dutch Shell.

It is thought the attacks were orchestrated by friends of jailed tribal chief Mujahid Dokubo-Asari, but some also think it was aimed at stealing the fuel supplies from the barges.

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Irish Independent: Big garda presence clears way for work on pipeline to resume

Published: Oct 04, 2006

A LARGE contingent of gardai will again be on duty in north Mayo this morning to ensure construction workers can enter the controversial Shell terminal for the Corrib Gas pipeline.

Up to 170 gardai were drafted into the Bellanaboy area early yesterday morning to make sure work at the 200m site could resume after a delay of more than a year.

The project was halted in early summer last year after the jailing of the Rossport Five over their continued protest at the pipeline and terminal over health and safety concerns.

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Irish Times: GardaI to escort Shell workers again today

By: Lorna Siggins, Western Correspondent, in Erris, Co Mayo, Irish Times
Published: Oct 04, 2006

A large Garda contingent is expected to be on duty in north Mayo again today to escort Shell staff and contractors into the Corrib gas terminal site in Bellanaboy.

GardaI yesterday removed protesters and placed them behind crash-barriers. They also removed vehicles.

GardaI also confirmed that objectors had been filmed by them.

The Shell to Sea campaign says it will maintain its peaceful protest. It described the security operation initiated early yesterday as akin to “martial law”.

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The Independent: N Sea producers forced to give gas away

By: Michael Harrison, The Independent – United Kingdom
Published: Oct 04, 2006

Britain’s big energy suppliers came under renewed pressure to cut bills yesterday after wholesale gas prices fell below zero, forcing North Sea producers to pay customers to take supplies off their hands.

In a highly unusual development, spot prices fell to minus 5p a therm due to a combination of weak demand and excess supply in the system, catching out a number of big producers, including BG and Shell.

This is the first time in nine years that wholesale prices have fallen below zero. But domestic gas users failed to benefit because all the free gas was snapped up by power stations and large industrial consumers. This caused prices to rebound later in the day.

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FT: Small oil operating ‘below the radar’: big beasts of the energy world stalked by the Russian authorities

By Ed Crooks, Energy Editor
Published: October 4 2006 03:00 | Last updated: October 4 2006 03:00

While the big beasts of the energy world are being stalked by the Russian authorities, some of their tiny competitors are making a living in niches out of sight of the Kremlin.

Several Aim-listed companies are involved in Russian oil and gas, including Imperial Energy, Victoria Oil and Urals Energy.

The Russian moves against Shell and BP have unnerved investors in the smaller companies. Shares in Urals Energy, for example, an explorer and producer with operations in Sakhalin Island off Russia’s far eastern coast and across the country, fell by 17 per cent last month.

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Reuters: UPDATE 3-At least 5 foreign oil workers abducted in Nigeria

Tue Oct 3, 2006 8:04pm ET
By Tom Ashby

LAGOS, Oct 3 (Reuters) – Suspected militants invaded a residential compound for foreign oil workers in Nigeria on Tuesday, killing two guards and kidnapping at least five expatriates, oil industry sources said.

The workers — including three Britons and two Malaysians — were taken from the compound in Eket, close to the operational base of ExxonMobil (XOM.N: Quote, Profile, Research), which exports about 800,000 barrels a day from Africa’s top oil producer.

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