December 18th, 2006:

Tuesday, December 19, 2006. Issue 3564. Page 1.
By Mayumi Negishi
Reuters

TOKYO — Japan’s Mitsui and Mitsubishi are seeking cash from state gas monopoly Gazprom in exchange for part of their stakes in the $22 billion Sakhalin-2 project, sources close to the talks said Monday.

The two Japanese partners, who together hold a 45 percent stake in Sakhalin-2, are in talks with majority stakeholder Royal Dutch Shell about ceding control of the world’s biggest liquefied natural gas project to Russian ownership, the sources said. read more

December 19, 2006
Carl Mortished: Analysis
 
How do you change a corporate culture when it loses credibility? It is a moot question for BP, where the senior executives are beating their chests — Tony Hayward, head of exploration and candidate for the chief executive’s job, recently told an internal audience in Houston that the top of the organisation was not listening.

He said that management was too directive and too fond of making a virtue out of doing more for less. “(BP) has lived too long in the world of making do and patching up this quarter for the next quarter,” he said. 
 
It was a pep talk for staff bruised and battered by bad news from the deadly explosions at Texas City to the oil pipeline corrosion in Alaska, all blamed on cost-cutting. It was also, no doubt, an effort by Mr Hayward to project himself as a potential architect of change, a necessary image for a man who would like to be BP’s next leader. read more

Natural resources
December 19, 2006
Carl Mortished, International Business Editor

State to control Statoil and Norsk
Largest offshore unit in the world

Norway will create a gas export colossus with the merger of Statoil and Norsk Hydro, which will take a commanding position in the Northern European gas market and become the largest offshore operation in the world.

The two groups said yesterday that they would combine their oil and gas businesses in a $30 billion (£15.4 billion) deal, creating a single entity with the financial and operational power to compete internationally. 
 
The merged business, whose controlling shareholder will be the Norwegian state, will enhance Norway’s market clout in the European gas sector. It will incorporate Norsk Hydro’s expanding gas operations into Statoil, boosting it’s dominant position as marketer of the Norwegian state’s gas holdings. read more

December 19, 2006
Ben Webster and Lucy Alexander
 
A giant wind farm in the Thames Estuary was approved by the Government yesterday despite a warning from the shipping industry that it would significantly increase the risk of massive pollution in the event of a collision.

It will be located 12 miles off the coast between Margate in East Kent and Clacton in Essex and consist of 341 turbines spread over 90 square miles, making it the world’s largest offshore wind farm. 
 
The Chamber of Shipping said that the decision had been rushed through by the Department of Trade and Industry without proper consideration of the risks to mariners. More than 100 ships a day would pass close to the wind farm. read more

Author: Henk Ruyssenaars – Foreign correspondent
Date Created
18 Dec 2006

Soon it will be announced that SHELL in Russia has made an energy ‘deal’ with Putin’s government. But it is ‘an offer they can’t refuse’. SHELL lost this important geopolitical fight for energy resources and must surrender control over Sakhalin-2, the only foreign owned huge oil and gas fields in Siberia.

To stop SHELL expats they were ‘investigated for visa violations’… read more

By Bunny Nooryani

Dec. 18 (Bloomberg) — Statoil ASA, Norway’s state- controlled oil company, agreed to buy Norsk Hydro ASA’s energy business for about $28 billion as supplies from domestic fields peak and competition intensifies for drilling contracts from Russia to Venezuela.

The combined group will control about 70 percent of production in Norway, the world’s third-biggest crude exporter, as prices stay above $60 a barrel. A bigger Statoil will be better placed to compete with BP Plc, Royal Dutch Shell Plc and OAO Gazprom for reserves. read more

Tuesday 19 December 2006

Shell CEO Jeroen van der Veer at a meeting with Gazprom CEO Alexei Miller today gave his consent for the Russian gas monopoly’s becoming a stockholder of the biggest Russian gas project Sakhalin 2 and handing over 30% shares to it. Earlier, Gazprom Chairman of the Board of Directors Dmitry Medvedev announced that share of the company in the project may total up to 50%.

As a result of the last large-scale inspection held by Rosprirodnadzor, numerous violations of the environmental legislation were found which brought about withdrawing 12 licenses for water use from Starstroy Company, subcontractor of Sakhalin Energy Company. According to spokeswoman for the Federal Agency for Water Resources Anna Khitrova, “annually, about a hundred licenses for water use are taken away.” So, licenses withdrawn at a time from the single Starstroy total practically 10% from the annual amount of licenses withdrawn all over the country. read more

December 18th, 2006

Port Harcourt, Nigeria – Terrorists have hit Nigeria’s restive Niger Delta region’s oil facilities.
 
One blast hit property belonging to the Royal Dutch Shell in Port Harcourt. The other hit the fence of a compound belonging to Italian company Agip.

Little damage has been reported, and no-one was hurt.

The militant group, Movement for the Emancipation of the Niger Delta (Mend) has claimed responsibility for what it described as car bomb attacks.

It is the first time Mend have targeted residential compounds. read more

Issue #1231(97), Tuesday, December 19, 2006
By Miriam Elder
Staff Writer
 
MOSCOW — Oleg Mitvol, the state official leading the charge against Shell-run Sakhalin-2, was threatened with disciplinary action Thursday. Yet it looked like his boss was the one in greater danger of losing his job.

Sergei Sai, the head of the Natural Resource Ministry’s environmental watchdog, sent a letter to Minister Yury Trutnev seeking disciplinary action against Mitvol, his deputy.

The latest infighting among state officials came just days after Gazprom said it was close to reaching a deal on securing a stake in Shell’s huge oil and gas project at Sakhalin-2, which Mitvol has accused of gross environmental violations. read more

Tyson Slocum
December 18, 2006

Tyson Slocum is the director of  Public Citizen’s Energy Program .

Big Oil’s lobbying representative in Washington, D.C.—the American Petroleum Institute, whose annual budget exceeds $112 million—recently said that they “will spend what’s necessary” to reform the industry’s battered public image. So they’ve hired the same PR firm that developed the “Got Milk?” campaign.

One of the reasons the oil industry can afford its new public relations spending spree is the fleecing it’s pulled on the American taxpayer with the active help of the Bush administration. A recent Inspector General audit of the U.S. Department of the Interior’s Minerals Management Service concludes that oil companies are pumping oil from federal land without paying adequate royalties to taxpayers for the privilege. The report cites widespread cronyism, ethical breaches, decimated auditing staff and overreliance on information provided by Big Oil as culprits in the oil industry giveaway. Meanwhile the Justice Department unexpectedly announced the welcome news that it has initiated criminal investigations  into the Interior Department’s oversight of oil companies. read more

Paying the price for resistance
 
Scott Calvert
Sun Foreign Reporter
December 18, 2006

OKERENKOKO, Nigeria — This riverside village along remote creeks of the Niger Delta is a base for a violent insurgency that has forced a 20 percent to 25 percent cut in Nigeria’s oil output – the fifth-biggest source of petroleum imports for the United States – and helped fuel this year’s higher gas prices.

The winding path through the creeks is so dangerous that scores of oil workers have been evacuated to guarded compounds in Warri, a rundown city 90 minutes away by speedboat. Those brave or naive enough to travel the creeks risk being detained by the Nigerian navy and strongly urged to turn back. read more

Mon Dec 18, 2006 12:11pm ET 
By Austin Ekeinde

PORT HARCOURT, Nigeria (Reuters) – Two car bombs exploded at oil company compounds in Nigeria’s oil capital Port Harcourt on Monday damaging cars but causing no casualties, authorities said.

The blasts occurred in the car park of a residential compound of Royal Dutch Shell, while the other was on a perimeter wall of a compound of Italian oil company Agip.

There was no immediate impact on oil production.

“The other two bombings were directed at Shell … and Agip,” the Movement for the Emancipation of the Niger Delta (MEND) said in an email to the media adding that a third planned bombing was canceled to avoid high civilian casualties. read more

The Associated Press: Published: 2006-12-18 08:20:18

PORT HARCOURT, Nigeria: Militants seeking a greater share of oil revenues for their impoverished region detonated two car bombs nearly simultaneously in southern Nigeria on Monday, sending shock waves through a city already reeling from attacks that have pared a quarter of crude production in Africa’s oil giant.

Police official Bassie Inyang said no casualties were reported at either site.

At one, a compound belonging to Italian oil firm Agip, the force of the blast blew out windows of a medical facility and cracked compound walls. Agip said in a statement that the car bomb was parked outside the compound wall and that no injuries were reported. Residents of the Shell compound hit by the other blast said several cars caught fire. read more

Published: Dec 18, 2006

Shell oil said a blast struck one of its facilities Monday in restive southern Nigeria. The main militant group had said it had planted three car bombs around the region.

A company spokesman, Bisi Ojediran, said the blast hit company property in the city of Port Harcourt, but he gave no details on any casualties or production cuts in Africa’s oil giant. Minutes earlier, the Movement for the Emancipation of the Niger Deltahad said a car-bomb attack was imminent.

Copyright 2006 Associated Press read more

EXTRACT: And now for something a little bit special. This is an award for Company Song So Awful I Was Positive It Was a Spoof. The outstanding winner in this category is Shell. Its song is called “Growing and Winning” and is set to “We Are the World”. “We have moved on, growing day by day/Sharing strengths, we practise what is best/We are all a part of Shell’s global family/Doing work aligned with everyone.” It is a haunting mixture of pyschobabble, sentimentality and business jargon. Go to www.ft.com/kellaway and listen yourself. You won’t be disappointed. read more

By Julie Ziegler

Dec. 18 (Bloomberg) — The Nigerian ventures of Royal Dutch Shell Plc and Eni SpA reported attacks near their facilities following threats from a militant group.

Shell spokesman Bisi Ojediran said a Shell facility had been attacked, adding that he had no further details. Fidelis Anjou, a spokeman for Eni’s Agip unit, said a blast occurred near a compound in the southern city of Port Harcourt.

The reports followed a warning earlier today by the Movement for the Emancipation of the Niger Delta, or MEND, that three car bombs were set to detonate “at any minute,” according to an e- mail statement released by the group’s spokesman, Jomo Gbomo. read more