January 18th, 2007:

Friday, January 19, 2007. Issue 3578. Page 8.
By Robert Skidelsky
 
Russia’s temporary halt to oil supplies through the pipeline crossing Belarus earlier this month was the latest in a sequence of public relations disasters for the Kremlin. The West’s romance with President Vladimir Putin’s Russia ended with the Yukos affair and since then Russia has generally gotten bad press, even when it had a good case. The Sakhalin-2 affair is a good example.

Early in December, Royal Dutch Shell announced that it had sold Gazprom a majority stake in the project to develop the Sakhalin gas field. In its Dec. 8 edition, The Economist magazine accused the Russian state of using “minor environmental infringements” to force Shell and its partners to sell out to Gazprom at the moment when they stood ready to receive a “flood of revenues.” Such “loutish” behavior was incompatible with Russia’s claim to be a reliable energy partner. The Russian case for action, based on the impact of Shell’s cost overruns on the expected revenue of the Russian state, was simply ignored. read more

Jan. 18, 2007

Russia’s Federal Service for Supervising Natural Resources (Rosprirodnadzor) launched yesterday the probe into the execution of license agreement for development of Kovykta field, which is under TNK-BP’s control.

Yesterday, Russia’s Federal Service for Supervising Natural Resources (Rosprirodnadzor) committed its Irkutsk branch to initiate the check of Kovykta field, completing it by January 26, a source with Rosprirodnadzor said on condition of anonymity. The probe was ordered by the Federal Agency for Subsoil Use (Rosnedra). In TNK-BP, they said they have received no respective notification yet. The Federal Agency for Subsoil Use declined to comment officially. read more

EXTRACT: “The world’s multinational energy companies are feeling the effects of nationalism, “said Bryan Squibb, Aon U.S. Trade Credit national managing director. “Oil – producing countries are seizing local resources that were once owned by or shared with international oil companies.”

“This could be a blanket country action, such as Bolivia’s outright nationalization of the oil & gas industry in May 2006, or more targeted action, possibly through arbitrarily imposed regulations and interference against individual projects, such as Russia’s recent moves against Sakhalin II or BP’s TNK-BP. read more

EXTRACT: …in the meantime a big oil terminal on the southern end of Russia’s Sakhalin Island could open this year, resulting in a spike in eastward oil tanker travel along the route. And the Bush administration’s decision on January 9th to lift a moratorium on oil drilling in nearby Bristol Bay, where Shell hopes to develop natural gas resources, could further increase Aleutian traffic. Expect more wrecks.

THE ARTICLE

The North Pacific great circle route

Jan 18th 2007 | DUTCH HARBOR
From The Economist print edition read more

Eric Watkins
Senior Correspondent

LOS ANGELES, Jan. 18 — The World Wildlife Fund (WWF) has urged international lending institutions to follow the lead of the European Bank for Reconstruction & Development and not provide loans for the Sakhalin-2 project due to environmental concerns.

“The WWF and other international organizations have appealed to potential Sakhalin-2 sponsors to adopt the correct environmental position and follow the example of the European Bank for Reconstruction & Development, which refused to provide the project with $300 million in financing on Jan. 11,” WWF said in a statement. read more

Jan 18th 2007
From The Economist print edition

The British oil firm is in trouble. But its rivals face many of the same problems

NO ONE calls upon James Baker, an American elder statesman, to solve a trivial problem. George Bush recruited him to defend his interests in Florida during the disputed election of 2000, and more recently to examine ways out of America’s morass in Iraq. The United Nations once asked him to settle a 30-year-old conflict in Africa. So it says a lot about the state of BP, a big British oil firm, that it asked Mr Baker to head a panel to assess flaws in its safety regime. read more

Alberta needs at least three, utility says
SHAUN POLCZER CALGARYHERALD

At least three new pipelines will be needed to move Alberta’s growing oilsands production to new markets in the United States and overseas, a senior official with Enbridge Inc. said Wednesday.

Those are on top of a 400,000barrel per day (bpd) link to the U.S. Gulf Coast and a proposed 300,000 bpd hook-up to Kitimat, B.C., said Rick Sandahl, Enbridge’s senior vice-president of market development.

“There’s a need for significant infrastructure changes going forward,” he told a Calgary oilsands conference. read more

Posted on : Thu, 18 Jan 2007 16:27:59 GMT | Author : Energy News Editor
 
MOSCOW, Jan. 18 Russian regulators said Thursday they will inspect Sakhalin-1 in late February or March to see if Exxon Neftegaz Ltd. Co. is complying with environmental law.

The inspection was scheduled to be carried out last October, but was postponed because of the multitude of problems with Sakhalin-2 and a shortage of specialists, Oleg Mitvol, deputy head of Rosprirodnadzor, told ITAR-TASS news agency. We will start it depending on weather conditions, he said. ENL operates the Sakhalin-1 project, which is expected to produce 12.5 million tons of oil annually for 40 years. The project includes SODECO, ONGC Videsh, Sakhalinmorneftegaz and RN Astra.
 
The oil and natural gas will … be piped to the Russian mainland to the export terminal of DeKastri, the U.S. Energy Information Administration says. “Planned exports of oil to world markets, with the assistance of ice-breaking vessels, is scheduled for 2006. Sakhalin I’s natural gas is expected to be sent southward to Japan via a proposed pipeline. The partners are planning for natural gas exports to Japan to begin in 2008.The project is the largest foreign investment in Russia and capital investment over the life of the project could reach $12 billion. read more

EXTRACT: The move by Rosprirodnadzor suggests that Kovykta’s fate could mirror that of Shell’s $22 billion (euro17 billion) project on Sakhalin island, off Russia’s Pacific coast. After a barrage of environmental probes led by Mitvol, Shell and its Japanese partners agreed in December to sell a controlling stake to Gazprom.

The Associated Press January 18, 2007, 10:50AM EST

MOSCOW: Russia’s environmental watchdog agency is preparing to probe a giant natural gas field owned by BP PLC’s Russian joint venture, a top agency official said Thursday. read more

By Kelpie Wilson
t r u t h o u t | Environmental Editor

Thursday 18 January 2007

Are we in Iraq to bring freedom to the Iraqi people, as Bush says, or are we in Iraq to preserve the “easy motoring” freedom of American consumers by staking our claim to Iraq’s oil?

For those who have even a passing acquaintance with the geopolitical reality of how the world’s remaining oil is distributed, the answer is obvious: “It’s the oil, stupid.” Iraq has the world’s second-largest reserve of the light, sweet crude oil that sells for billions upon billions of dollars in the world economy. read more

EXTRACT: MEND said that it was planning to stop taking hostages and begin focusing on using sabotage and bombings to cripple the oil industry.

By Julie Ziegler and Karl Maier

Jan. 18 (Bloomberg) — One Italian and five Chinese hostages being held by two different groups in Nigeria were released today amid continued violence in the nation’s oil-producing region.

Three other hostages captured on Dec. 7 by the Movement for the Emanicipation of the Niger Delta are still being held. The hostages as well as the freed Italian, Roberto Dieghi, are employees of a unit of Eni SpA, Italy’s largest oil company. A separate group released five Chinese telecommunications worker kidnapped almost two weeks ago, the Chinese foreign ministry said today. read more

By Winnie Zhu

Jan. 18 (Bloomberg) — Royal Dutch Shell Plc said it has agreed with a privately owned Chinese company to build retail service stations in southwestern China to tap rising demand for auto fuels in the world’s second-biggest car market.

Shell will team up with Chongqing Shuorun Petroleum Co Ltd. to build a network of service stations in Chongqing province, Liu Xiaowei, a spokeswoman for Shell in Beijing, said by telephone today.

Europe’s largest oil company by market value is competing with rivals including BP Plc and China’s two biggest oil companies for market share in the retailing of diesel and gasoline. China Petrochemical Corp. and China National Petroleum Corp. run more than half of the country’s 80,000 retail stations. read more

By Anthony DiPaola

Jan. 18 (Bloomberg) — Chevron Corp. and Royal Dutch Shell Plc led the largest publicly traded oil companies in crude discoveries last year as Eni SpA and ConocoPhillips were among the least successful, Sanford C. Bernstein & Co. analysts said.

Oil companies had to drill deeper to find fields, which are increasingly smaller than in the past, Neil McMahon, a London- based Bernstein analyst, wrote in a report today. That makes it harder for companies to replace pumped oil with new finds each year, McMahon said. read more

*Oleg Mitvol turns his attention to BP 

17:17 | 18/ 01/ 2007 

MOSCOW, January 18 (RIA Novosti) – Russia’s environmental watchdog will check compliance with license agreements on the Kovykta natural gas deposit in East Siberia, at which TNK-BP [RTS: TNBP] holds licenses in late spring, an agency official said Thursday.

“The probe will start before the end of the spring; I can’t give a more precise timeframe yet,” said Oleg Mitvol, deputy head of the Federal Service for the Oversight of Natural Resources. read more

*(Dr John Huong may wish to take note of this article in connection with the defence of the High Court action brought against him collectively by EIGHT Royal Dutch Shell companies for alleged defamation relating to articles posted under his name on this website: the next hearing takes place on 8th February 2007)

Run Date: 01/18/07
By Bojana Stoparic
WeNews correspondent

Two oil pipelines in Russia and the Caucasus boosted prostitution and poverty according to a recent report. Authors hope the findings will heighten awareness of gender-related development needs at this weekend’s World Social Forum in Kenya. read more

Royal Dutch Shell plc issues its first Technology Report, an overview of 27 advanced technologies – some delivering benefits today and others that will shape the future of the energy industry.

The Shell Technology Report shows how the company is developing and applying technology to meet the tremendous challenge of securing the world’s growing energy needs in an environmentally responsible way.

Technology is central to meeting the Middle East’s energy challenge, both in producing efficiently and effectively the region’s energy resources and in meeting the Middle East’s growing energy needs. Shell has technology centres in Doha and Muscat and contributes to the development of technical professionals through its operations and support for tertiary education institutions across the region. read more