Posts from ‘May, 2007’

By BOBBY MAGILL The Daily Sentinel

Thursday, May 31, 2007

An exchange of more than 5,000 acres of land in northwest Colorado between the Colorado Division of Wildlife and Royal Dutch Shell is being hailed by the state as a victory for both hunters and wildlife.

Under the proposal, the DOW will deed 3,108 acres of land and water rights in the Piceance State Wildlife Area in Rio Blanco County to Shell. In exchange, the energy company will transfer to the DOW 1,800 acres between the two parcels of the Oak Ridge State Wildlife Area, which is east of Meeker near the Flat Tops. The transfer will connect the two parcels, increasing Oak Ridge’s size to about 11,100 acres, DOW spokesman Randy Hampton said.

“It’s a good deal for sportsmen, good deal for wildlife,” Hampton said.

The U.S. Fish and Wildlife Service on Wednesday gave its stamp of approval to the exchange, saying it will present no significant environmental impact. No members of the public raised concerns about the exchange after it was first announced earlier this year.

The DOW’s Piceance parcels in the exchange were hard to manage and difficult to access, Hampton said.

“We’re getting a pretty good piece of land out of (the exchange),” he said.

Oak Ridge is prime elk wintering range, replete with rolling ridges and oak brush, he said.

The Piceance parcels are valued at about $3 million, while Shell’s Oak Ridge parcel was appraised at $2.8 million. To make up the difference, the company will pay the state $129,000 in cash, according to the Fish and Wildlife Service.

Hampton said the most popular areas within the Piceance State Wildlife Area will remain open and are excluded from the land exchange.

Shell spokeswoman Darci Sinclair said Shell doesn’t have final plans for the Piceance parcels it acquires.

Such land exchanges, she said, “are a regular part of doing business for Shell.”

The company plans to conduct testing on its in situ oil shale extraction method on three Bureau of Land Management leases nearby, she said.

The Fish and Wildlife Service was required to approve the land exchange because the DOW acquired the parcels for the Piceance State Wildlife Area from the federal government under a law providing aid for wildlife restoration. The law requires the Fish and Wildlife Service to analyze potential environmental harm caused by the disposal of land acquired under the law.

Bobby Magill can be reached via e-mail at bmagill@gjds.com.
 
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http://www.gjsentinel.com/news/content/news/stories/2007/05/31/5_31_Shell_Land_Exchange.html  
 

By Tony Hopfinger

(Bloomberg) — Drilling plans by Royal Dutch Shell Plc and other oil companies in Alaska are drawing complaints from activists, fishermen and Eskimos at the International Whaling Commission meeting in Anchorage, Alaska.

Shell and the government haven’t prepared for spills in the Arctic, while exploration will disturb whale habitats, Betsy Goll, a spokeswoman for Alaska Wilderness League, said in a statement. The World Wildlife Fund is opposing U.S. plans to extend the exploration to Bristol Bay in southwestern Alaska by 2011, Margaret Williams, a fund director, told reporters yesterday.

“We’re worried about the noise from seismic and the effect it would have on whales,” Williams said. Seismic exploration uses sound waves to gather clues about underground oil deposits.

Dwindling discoveries have pushed oil companies into remote and more hostile regions to benefit from record demand and prices. U.S. President George W. Bush this year lifted a moratorium on drilling in Bristol Bay to tap reserves that may reduce reliance on Middle East supplies. Shell, Europe’s largest oil company, has shown the most interest in offshore exploration in Alaska.

Shell announced earlier this year a plan to navigate a small fleet of exploration ships into the Arctic’s Beaufort Sea. The company is waiting on permits to allow as many as three exploration wells this summer, Shell spokeswoman Terzah Poe said in an e-mail.

Bowhead Whales

Eskimos living along the coastline said the noise may disturb migrating bowhead whales, walruses and seals, which they depend on for food. They also questioned whether Shell is prepared for a potential oil spill in the Beaufort Sea.

Noise shouldn’t cause any problems and the company will closely monitor sea mammals near its rigs, Poe said.

“In over 60 years of offshore oil and gas exploration and production in the U.S., there is not a single documented case of these activities resulting in serious harm to a whale,” Poe said. Shell’s fleet will include spill clean-up equipment, planes and about 16 oil-response barges, she said.

“They’ve never had a spill in Arctic waters, so how do they know they can clean it up?” Robert Thompson, 60, a whaler in the Alaska village of Kaktovik, said in a phone interview May 28.

Since 2005, Shell has spent $44 million on 84 federal oil leases in the Arctic’s Beaufort Sea, according to the Mineral Management Service, which oversees offshore oil leases in federal waters. In February, the service accepted Shell’s exploration plan.

Appealed Decision

North Slop Borough, which includes Kaktovik, Barrow and several other villages, have appealed the Mineral Management Service’s decision to allow Shell to drill this summer. If Shell’s plans are delayed, it will probably have to wait until next year because the Beaufort Sea will be starting to ice over.

Shell has also indicated it wants to explore in the Chukchi Sea, off the coast of northwest Alaska.

“Our people have never really been consulted by the government or the oil company on how we feel about what they’re doing,” said Enoch Adams Jr., vice mayor of Kivalina, an Eskimo village in northwest Alaska. “There have been no hearings. There have been no attempts to inform us specifically what they’re going to do. We have not been offered any timelines.”

An International Whaling Commission committee prepared a report for this week’s meeting expressing concerns about oil development in Bristol Bay, particularly for the endangered North Pacific right whale. The committee has recommended to the commission that more research be done to better understand the impact of seismic exploration on whales.

Endangered Species

Bristol Bay is part of the Bering Sea, one of the world’s largest commercial fisheries. Several whale species endangered in the U.S. migrate through the sea.

In the 1980s, Shell, Exxon Mobil Corp., BP Plc and other companies drilled dozens of exploration wells off the Arctic coast, including some that showed potential for producing commercial amounts of crude. The drilling program slowed when the ExxonValdez oil tanker ran aground in Prince William Sound, Alaska, in 1989.

Before ExxonValdez, Shell helped discover a large oil deposit off the coast of the northern Alaska. BP, Europe’s second-largest oil company, subsequently developed the field and named it Northstar, the first offshore field in Alaska’s Arctic.

The World Wide Fund has previously campaigned against funding by the European Bank for Reconstruction and Development for a Shell project in Sakhalin, Russia because of alleged harm to Pacific gray whales.

The European Bank Jan. 11 canceled plans to lend about $300 million to Russia’s $22 billion Sakhalin-2 oil and gas venture after state-owned OAO Gazprom took control from Shell. The withdrawal threatened a further $7 billion in loans from other state-owned credit agencies and commercial banks, which had expected the European Bank to take the lead. Environmental clearance for the project by the bank would influence larger loans from other government and private-sector banks in Japan, the U.S. and Europe, the European Bank said last year.

To contact the reporter on this story: Tony Hopfinger in Anchorage, Alaska at thopfinger@gci.net .

Last Updated: May 30, 2007 02:21 EDT

By Angela Macdonald-Smith

May 31 (Bloomberg) — Construction cost increases are threatening Australia’s targeted expansion in liquefied natural gas supply, said Belinda Robinson, chief executive officer of the Australian Petroleum Production and Exploration Association.

The country’s aim to quadruple LNG output by 2017 is “becoming more obviously challenging” than 18 months ago when the goal was set, Robinson said today at the South East Asia Australia Offshore Conference in Darwin.

Australia has more than A$50 billion ($41 billion) of proposed LNG projects in northern and Western Australia led by companies including Woodside Petroleum Ltd., Chevron Corp. and Inpex Holdings Inc. Chevron, the second-biggest U.S. oil company, and partners in the Gorgon LNG venture last year dropped a 2006 deadline for approving the more-than $10 billion project for development and are working to improve its economics.

“Soaring project costs related to tightness in the supply of construction materials, equipment, services, and limitations on the availability of a skilled workforce have constrained project growth,” Australian Industry Minister Ian Macfarlane said at the conference. “Not only does this have an impact on project returns but the scarcity of resources has the potential to delay some projects and increase supply timing risks.”

Royal Dutch Shell Plc and Exxon Mobil Corp. have stakes in the Gorgon venture.

To contact the reporter on this story: Angela Macdonald-Smith in Sydney at amacdonaldsm@bloomberg.net

Last Updated: May 31, 2007 00:49 EDT

Published: May 31, 2007

Tankers

LACK of demand is pulling down all tanker markets, especially very large crude carrier rates, with little relief for owners in the short term, writes Martyn Wingrove.

Charter rates are falling for double hulled VLCCs as refinering companies drip-feed the market with inquiries and hold back on chartering tankers.

Good availability of tankers is helping charterers to push down the cost of ship-ping crude to their refineries, but owners will be wondering when demand will pick up.

The West African market has been hit particularly badly by low demand as militant action in Nigeria has sabotaged pipelines and terminals, slashing the region’s crude exports.

This week Shell has been forced to slow oil production to the Bonny terminal after militants attacked a pipeline. This is on top of closures at the Forecados and Brass terminals in the Niger delta.

New President Umara Yar’Adua has promised to tackle the violence in the Niger delta and improve production levels, but this may take some time.

‘It is a quiet market with slow demand pulling all tanker markets down,’ said a London broker with Galbraiths. ‘There are still a fair few June cargoes to cover but charterers are holding back.’

The softening demand for cross-Atlantic voyages means VLCCs are securing rates of W75 to take West African cargoes to the US Gulf, down from W80 last week.

VLCCs are being fixed at rates of W67.5 to carry Gulf of Guinea crude to Asian terminals this week, with Formosa paying this rate to book SK’s 2003-built C Champion (317,614 dwt) to take a Nigerian cargo to Taiwan.

London brokers said rates for double-hulled VLCCs moving Middle East crude to Asia had fallen to W75, from highs in the W90s last week. Single-hulled tonnage is being fixed at rates of W65-W70.

Middle East loadings up to the end of June are available for oil companies so there are many fixtures still to be finalised. This should keep brokers fairly busy for the next few weeks, then the July stems will begin to emerge.

WILLIAM NSOYOH
Published: May 31, 2007

Four American oil worker hostages seized weeks ago in Nigeria’s restive southern oil heartland were publicly handed over to authorities, as protesters cut exports from Africa’s top petroleum producer.

As journalists looked on Wednesday, a judge who mediated in the dispute escorted the four Chevron Corp subcontractors taken May 9 to the governor’s offices in southern Rivers State where they were handed over to authorities.

U.S. embassy officials were not immediately available for comment.

Elsewhere, protesters besieged a major pipeline control center feeding a Royal Dutch Shell PLC oil export terminal in Nigeria, forcing the company to suspend exports of 150,000 barrels of crude oil a day, a company official said Wednesday.

Protesters from K-Dere in the Ogoni district of Nigeria’s southern oil region invaded the company’s Bomu Manifold on Monday, tampering with some pipeline equipment and forcing the shutdown of the facility, Shell spokesman Precious Okolobo said.

“We had to defer export of 150,000 barrels per day,” said Okolobo.

It was the second disruption of crude supply on the pipeline, which sends crude from onshore facilities around the oil industry center of Port Harcourt to Shell’s Bonny oil export terminal.

Growing lawlessness, including armed attacks, in the oil-rich southern Niger Delta that accounts for nearly all of Nigeria’s oil have cut about a quarter of the normal exports of Africa’s leading oil producer. Most inhabitants of the impoverished region of swamps, creeks and mangrove forests feel cheated out of the oil produced on their land and want an increased share of oil revenue.

Some 200 foreign workers have been kidnapped _ most quickly released for ransom _ since armed militants stepped up their attacks against the oil companies and government in late 2005. Some 20 foreign hostages remain in captivity.

President Umaru Yar’Adua used his inaugural address Tuesday to appeal for an immediate end to violence in Nigeria’s oil heartland, and the largest militant group said it would consider the overture.

Shell sponsors children’s book launch to help famous writer rally support to address environmental issues

Published: May 31, 2007

DUBAI, May 30 (DubaiPhotoMedia): Shell, a leading player in the global energy and petrochemicals industry, has announced its sponsorship for the launch of a culturally and environmentally oriented children’s book as part of Shell’s commitment to promote the positive attributes of the UAE and help protect its natural resources.

Famous children’s author Julia Johnson tells of the different species of birds found in the region in a funny and fascinating way that appeals to children in ‘A Bird’s Eye View’, the newest addition to her collection of published books that focuses on the environment and the culture of the UAE. “Shell is delighted to be part of a noble project that informs, entertains and encourages children to actively participate in the protection of the different species of birds found in the country.

As a company that puts a premium on proactive community work involvement, Shell views our sponsorship of the book launch as an opportunity to further expand the scope of our corporate social responsibility or CSR program, which has been one of the most successful in the industry,” said Omar Al Qurashi, Communications Manager, Shell Markets. Johnson has written around 11 children’s books that talk about the environment and highlight the rich culture of the UAE.

Her newest offering will be launched at the Children’s City in Creek Park, Garhoud in the presence of some 250 school children from 200 schools. “I am pleased to share Shell’s passion in building awareness about the natural attractions and the culture of the UAE. I am grateful to Shell for sponsoring the book launch and I look forward to collaborate with them in future projects that deliver a positive impact on the community,” said Johnson.

“Promoting the stunning sights and scenes of the country through the eyes of the children is a fun and fulfilling experience. A Bird’s Eye View hopes to draw the children’s attention to the beautiful birds that are naturally found in the country and encourage them to help in the preservation of such national treasures. The first step in rallying support for environmental protection programs is to make people appreciate the beauty and importance of the natural bounty,” added Johnson.

The book is illustrated by Donna Acheson-Juillet and published by Jerboa Books, a publishing house that focuses on English and Arabic titles that build awareness among children on various community issues. Shell has been involved in various community related activities through its CSR program, which is internationally recognized as one of the most successful in the business. Shell has initiated projects that address various issues, including environmental protection and conservation, manpower development, recognition of outstanding performance, and education.

(THROUGH ASIA PULSE)

Published: May 31, 2007

TURNOVER at Irish Shell hit the 780m mark in the 11-month period before the company was bought out by private equity group Topaz.

Accounts just filed show that Shell’s forecourts racked up sales of 664m to the period ending November 29, 2005, while turnover for the firm’s bitumen and aviation business came in at almost 120m.

The accounts, which cover the period immediately before control of the forecourts passed to Topaz, note that the aviation and bitumen businesses were hived off for a consideration of 43m.

Assets

After the sell-off the firm’s assets stood at close to 53m, less than a third of the 160m that Topaz is believed to have paid for the company.

The difference in the two values is largely due to the property development potential of the assets, with Topaz having realised more than 80m from selling off former Shell sites.

The directors’ statements in the accounts, signed off by Topaz chairman Neil O’Leary and Topaz chief executive Danny Murray, note the future outlook for the market is “very positive”.

“Topaz, through its assets and business models is well positioned to grow its business for the foreseeable future,” the directors add. “It will focus to seek growing organically, and in parallel, looking for complementary acquisitions.”

Published: May 31, 2007

A JUDGE yesterday visited the scene of the heated protests near the Corrib Gas terminal in Co Mayo.

Judge Mary Devins travelled to Bellanaboy to assess for herself the terrain along the roadway where, it is alleged, three local men assaulted and obstructed gardai last October.

Before Belmullet District Court are Patrick O’Donnell (49), his son Jonathan (21) and a 21-year-old neighbour, Enda Carey, all from Port Urlin, Ballina.

Patrick O’Donnell, a fisherman, is charged with assaulting and obstructing Sergeant Donal Glennon. Jonathan O’Donnell faces the same charges and a charge of assaulting Garda Barry Byrne, causing him harm.

Enda Carey is charged with assaulting and obstructing Sgt Glennon.

At Bellanaboy, Judge Devins, accompanied by a garda, viewed the entrance to the Shell terminal and also peered over a low barrier at the drain into which it is alleged Sgt Glennon was pushed on the morning of October 12 last.

In court later all three men denied they had formed a scrum or pushed the sergeant into the drain.

“There was no space to form a scrum”, said Patrick O’Donnell.

The court heard that between 150 and 300 protesters had gathered on the morning for the protest.

Patrick O Donnell added: “I went to take part in a protest to protect the health and safety of my family and to protect the fishing industry”.

Both Jonathan O’Donnell and Enda Carey similarly denied having any involvement in assaulting any member of the gardai.

Enda Carey said he and Jonathan O’Donnell had themselves been pushed into the drain, along with a garda. Judge Devins adjourned the hearing until June 13 and said that she would announce on that date when she would give her decision in the case.

EXTRACT: …as the Kremlin’s treatment of Yukos, Royal Dutch Shell and BP demonstrate, investors’ money to rebuild Russia is often welcomed, only for the rules to change later on.

Published: May 31 2007 03:00 | Last updated: May 31 2007 03:00

Russia’s recent economic and geopolitical resurgence belies some serious weaknesses at home. One is the country’s ageing electricity system. In his recent address to the Duma, President Vladimir Putin said that, up to 2020, the sector would need new investment of $460bn – equivalent to 34 per cent of Russia’s current, commodity-charged gross domestic product.

That means tapping the capital markets, which is why the long-stalled restructuring of the power sector has finally kicked off. Unified Energy System, the state-controlled monolith, is being broken up into generation, supply and wires units, with stakes being sold to investors.

The valuations fetched in the initial auctions of UES’s components demonstrated investors’ faith in the project, as does UES’s 2007 price/earnings multiple of 43 times, which was about double the level of 12 months ago. Justifying such optimism largely depends on what happens with domestic electricity prices.

Russian households’ monthly power bills are perhaps less than $15, which is a quarter of what goes to alcohol and cigarettes, according to Renaissance Capital. The broker reckons tariffs will need to double between now and 2011 if investors are to earn an adequate return on the capital being funnelled into the sector.

The good news is that many Russians clearly have the capacity to absorb higher prices. No politician likes to raise prices for basic goods such as power, but the prospect of the lights going out in the early years of a new presidency could help them overcome that. There are two big reasons to be cautious, however.

First, Russia is not the only big emerging economy embarking on a massive overhaul of its power sector, so cost inflation and delays are real risks. Second, as the Kremlin’s treatment of Yukos, Royal Dutch Shell and BP demonstrate, investors’ money to rebuild Russia is often welcomed, only for the rules to change later on.

Copyright The Financial Times Limited 2007

EXTRACT: Iran dismissed calls to suspend uranium enrichment on the eve of a vital meeting with the European Union, while protesters forced further disruption to oil production in Nigeria. Shell said 150,000 barrels a day of oil production had been halted after protesters stormed the Bomu pipeline complex, a major artery feeding the Bonny crude export terminal. This was the second attack in a month.

THE ARTICLE

By Chris Flood
Published: May 31 2007 03:00 | Last updated: May 31 2007 03:00

Crude prices remained choppy yesterday after a sharp fall in the previous session as traders wrestled with mixed news concerning oil supplies and ongoing geo-political concerns.

ICE July Brent fell 29 cents to $67.84 a barrel but Nymex July West Texas Intermediate rose 34 cents to $63.49 a barrel.

Market rumours included suggestions that the US government was preparing to release crude stocks from the strategic reserve if oil prices moved too high. However, officials in the Department of Energy said emergency supplies of crude would be released if a hurricane disrupted production in the Gulf of Mexico.

Meanwhile, Colonial Pipeline shut its main petrol line, which carries fuel from Gulf Coast refineries to New York, as a precaution following an integrity check. Colonial is the largest US pipeline for petrol, heating oil and diesel and no restart time has been announced.

Iran dismissed calls to suspend uranium enrichment on the eve of a vital meeting with the European Union, while protesters forced further disruption to oil production in Nigeria. Shell said 150,000 barrels a day of oil production had been halted after protesters stormed the Bomu pipeline complex, a major artery feeding the Bonny crude export terminal. This was the second attack in a month.

Nigeria’s oil production has lost around 845,000 barrels a day due to violence by militants, around one-third of its total. Output losses in Nigeria are one reason for Brent’s continuing premium over WTI.

Petrol prices weakened ahead of the latest US weekly inventories data which have been delayed until today due to Monday’s public holiday.

A poll of analysts by Reuters suggested petrol stocks were expected to have risen by 1.2m barrels last week as refineries stepped up production to meet peak summer demand. Refinery utilisation was expected to have risen by 0.7 percentage points to 91.8 per cent. Traders will also be looking to see if there is any indication that high prices have hurt demand. Crude stocks were expected to have increased by 0.7m barrels.

Nymex June RBOB gasoline fell almost 3 cents to $2.2685 a gallon. Petrol prices have fallen 5.6 cent so far this week.

Base metals came under pressure following Wednesday’s sell-off in the Chinese equity market with copper down 0.8 per cent to $7,210 a tonne in spite of a fall of 1,675 tonnes in London Metal Exchange stocks.

Lead, however, rose 2.1 per cent to $2,287.5 a tonne after hitting a new record of $2,290 earlier in the session. Analysts at Standard Bank said further gains for lead prices were possible approaching the summer – historically a period of high demand, especially from the battery industry.

Zinc fell 1.5 per cent to $3,595 a tonne. Analysts at Barclays Capital said the metal’s recent sell-off had been overdone and with LME stocks at a 16-year low (suggesting significant tightening in the market) zinc’s fundamentals could push prices to $4,000.

In Chicago, wheat prices rebounded strongly with July futures up 21 cents to $5.12 a bushel after the US Department of Agriculture revised its assessment for both winter and spring wheat crop conditions down slightly.

Wheat’s strength inspired gains for July corn, which rose 14 cents to $3.78¾ a bushel while July soyabeans added just 11 cents at $8.08½ a bushel.

Copyright The Financial Times Limited 2007