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BP to maintain footing in Gulf of Mexico

Despite the fourth anniversary of the Deepwater Horizon incident approaching, BP says it’s committed to playing a major role in Gulf of Mexico operations. Eleven rig workers died when a series of cascading failures at the Deepwater Horizon rig, which BP leased from Transocean, caught fire and sank in the Gulf of Mexico on April 20, 2010. According to U.S. government estimates, about 4.9 million barrels of oil spilled in months following the accident. BP Chief Executive Officer Bob Dudley said during an annual meeting the Gulf of Mexico was a central part of the company’s portfolio. "We remain very committed to BP playing a major part in the future prosperity of the Gulf of Mexico region, where we invest billions, employ about 2,300 people and support tens of thousands more jobs in other businesses," he said Thursday. Last month, BP won its first […]

Posted On : Published By : Tom Whipple
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Ohio Geologists Link Fracking With Earthquakes

Ohio officials are limiting hydraulic fracturing—or fracking— in a small area of the state after finding that the technique for tapping oil and gas may have triggered a series of minor earthquakes in March. The state regulator is among the first government authorities to impose seismic-related restrictions on fracking, in which drillers shoot water, sand and chemicals down wells to crack open rock and extract fuel. But other states, including Kansas, are looking at the links between oil and gas activity and small quakes. Researchers have previously found such tremors can be triggered by disposal of fracking waste water in deep wells near geologic faults. The Ohio Department of Natural Resources said Friday it was halting fracking within a 3-mile radius of the epicenter of the quakes in northeastern Ohio, and said firms operating in the Utica Shale—a rock formation holding vast quantities of natural gas—must install seismic monitors […]

Posted On : Published By : Tom Whipple
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Lower prices pull down natural gas reserves in 2012

Lower natural gas prices drove down U.S. proved reserves in 2012, despite notable gains in the Marcellus and Eagle Ford shale gas plays. The decline stopped a 14-year trend of consecutive increases in natural gas reserves, according to newly published estimates in EIA’s U.S. Crude Oil and Natural Gas Proved Reserves 2012 . Proved reserves are volumes of natural gas that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions. Natural gas proved reserves, estimated as wet natural gas that includes natural gas plant liquids, decreased 7% in 2012 to 323 trillion cubic feet (Tcf), as operators revised the proved reserves of their existing natural gas fields downward in response to lower natural gas prices (the natural gas spot price at the Henry Hub dropped below $2.00 per million British thermal units (MMBtu) in April […]

Posted On : Published By : Tom Whipple
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Key US senators call for EIA study on crude export policy

The Senate Energy and Natural Resources Committee chairman and ranking member have asked the Energy Information Administration to analyze the impact of lifting restrictions on US crude oil exports. "This is a complex puzzle that is best solved with dynamic and ongoing analysis of the full picture, rather than a static study of a snapshot in time," Senator Mary Landrieu, Democrat-Louisiana, and Senator Lisa Murkowski, Republican-Alaska, wrote to EIA Administrator Adam Sieminski on Friday. The letter follows a request in February by Senators Ron Wyden, an Oregon Democrat, and Maria Cantwell, a Washington Democrat, to produce a report on how US gasoline prices would be impacted if restriction on US crude exports were lifted. Article continues below… Request a free trial of: Oilgram News Oilgram News brings you fast-breaking global petroleum and gas news on and including: Industry players, upstream and downstream markets, refineries, […]

Posted On : Published By : Tom Whipple
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Alaska’s Peak Oil Crisis

Competition often breeds excellence. Nowhere else does this cliché hold more true than in the shale boom that’s currently underway. In North Dakota, we see drillers are consistently improving their operational efficiencies with practically every new well drilled. Independent companies like Continental Resources have lowered their average well costs in the Bakken by almost 20%. Their success is far from an anomaly, and it has become a standard for every other operator. What’s more is that this isn’t restricted to just North Dakota. Today, competition has helped the oil bonanza spread like wildfire across the lower 48 states as new drilling technology unfolds. Unfortunately, that simply isn’t the case for everyone. Boom to Bust for Big Oil Take a look at the other side of the spectrum. Alaska has arguably been the most sensational disappointment in the U.S. oil industry since the 1980s, and the blame rests squarely on […]

Posted On : Published By : Tom Whipple
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Ukraine-Russia gas row: Red bills and red rags

The political pressure is rising as the pipeline pressure falls Russia has threatened to cut gas supplies to Ukraine because of the dispute over prices. That could also affect EU countries, as much Russian gas is delivered to the West through Ukraine. We examine what’s behind the row, and its potential impact on Europe and its gas supplies. What is the row about? The immediate dispute is about Ukraine’s very large unpaid gas bill: $2.2bn (£1.2bn; 1.4bn euros), according to the Russian state-controlled utility Gazprom. If Ukraine does not settle its bill, Gazprom will in effect install the world’s largest pre-pay meter, and Ukraine will be obliged to pay for its gas in advance. If it fails to pay, Gazprom says it will restrict or suspend delivery. But lurking behind this is the power struggle between the interim Ukrainian government, which leans towards the EU, and Russia, which wants […]

Posted On : Published By : Tom Whipple
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US imposes sanctions on Crimea gas group

The US government has imposed sanctions against the Crimean subsidiary of Ukraine’s national gas company, which was seized by the region’s parliament in the run-up to its annexation by Russia. The Department of Commerce said on Friday afternoon that Chernomorneftegaz – also known as Chornomornaftogaz – had been added to the list of entities facing trade restrictions, saying the company’s assets were “now being overseen by Russian government interests”. The sanctions are likely to make it impossible for US companies to enter joint ventures with Chernomorneftegaz to explore areas in the Black Sea that are believed to hold significant oil and gas reserves. However, it had already been clear since Russia’s move into Crimea that the disputed status of those areas would make operating there very difficult for western companies. ExxonMobil and Royal Dutch Shell had been pursuing an offshore joint venture in the Black Sea with companies other […]

Posted On : Published By : Tom Whipple
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Gas Carousel Making Spain Europe’s Biggest LNG Exporter

Spain overtook Norway last month to become the region’s biggest exporter of liquefied natural gas. The southern European nation has never produced any of the fuel. The twist is a consequence of the crisis that left more than a quarter of Spain’s workers unemployed as the economy weakened for nine straight quarters. Utilities that contracted to buy LNG before the slump are now contending with a sixth consecutive year of diminishing domestic demand, spurring them to re-export cargoes. The trade is being underpinned by prices in Asia and South America that are about 30 percent higher than in Europe. Japan is importing more after shutting down its nuclear power plants following the Fukushima disaster in 2011. South American nations are accelerating purchases after a drought in Brazil limited the supply of hydroelectric power and cold snaps in the U.S. curbed pipeline flows to Mexico. “It doesn’t make much sense […]

Posted On : Published By : Tom Whipple
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Energy Chiefs Push for European Policy Shakeup on Ukraine

The crisis in relations with Russia should compel the European Union to transform its energy policy and reduce the region’s dependence on natural gas imports, a trio of industry leaders said. “If it really wants to wean itself off Russia gas, it needs to embark on a medium-term program made up of improving gas interconnections, shale-gas friendly regulation, alternative imports, more nuclear and possibly more coal,” Paolo Scaroni , chief executive officer of Italy’s largest oil company, Eni SpA (ENI) , said in e-mail comments today. The EU imported 30 percent of its gas supply from Russia last year, a proportion that’s even higher in some eastern and southern European countries. That reliance has come under scrutiny during the crisis over Ukraine this year, sparking a debate about how to diversify sources of supply. Russian President Vladimir Putin has warned Ukraine’s non-payment for gas shipments may threaten supply to […]

Posted On : Published By : Tom Whipple
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Oil Futures Extend Losses

Crude-oil futures were lower in Asian trading hours Friday on speculation a Libyan ports may reopen for exports next week and concerns of rising international supply. On the New York Mercantile Exchange light, sweet crude futures for delivery in May traded at $103.08 a barrel at 0551 GMT, down $0.32 in the Globex electronic session. May Brent crude on London’s ICE Futures exchange fell $0.28 to $107.18 a barrel. Libya’s National Oil Co. on Thursday lifted a force majeure on the al-Hariga crude export terminal with a daily capacity of 110,000 barrels, news reports said. Libyan government forces had taken control of the Al-Hariga and Zueitina ports on Wednesday ending a nine-month blockade by rebels, they said. "Libya aims to ship the first tanker from the harbor of Hariga within the next week," ANZ said in a note. While Al-Hariga accounts for 8.5% of Libya’s export capacity rebels retain […]

Posted On : Published By : Tom Whipple