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Ethanol Drops as Production Climbs to Highest Since December

Ethanol declined in Chicago for a fourth day following a government report that production last week climbed to the highest level since December. Futures fell 4.1 percent after the U.S. Energy Information Administration said output increased 4.8 percent to 939,000 barrels a day, the steepest gain since Sept. 27. “The trade is really keying on the production number; it was big,” said Mike Blackford, a consultant at INTL FCStone in Des Moines , Iowa. Denatured ethanol for May delivery fell 9.3 cents to settle at $2.172 a gallon on the Chicago Board of Trade, the lowest since Feb. 24. Prices have gained 14 percent this year. Gasoline for May delivery slid 0.16 cent to $3.0405 a gallon on the New York Mercantile Exchange . The contract covers reformulated gasoline, made to be blended with ethanol before delivery to filling stations. Ethanol’s discount to the motor fuel expanded 9.14 cents […]

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Midnight Welding Picks Up Slack That Imperils Shale Boom

How high is demand for welders to work in the shale boom on the U.S. Gulf Coast? So high that “you can take every citizen in the region of Lake Charles between the ages of 5 and 85 and teach them all how to weld and you’re not going to have enough welders,” said Peter Huntsman, chief executive officer of chemical maker Huntsman Corp. (HUN) So high that San Jacinto College in Pasadena , Texas, offers a four-hour welding class in the middle of the night. So high that local employers say they’re worried there won’t be adequate supply of workers of all kinds. Just for construction, Gulf Coast oil, gas and chemical companies will have to find 36,000 new qualified workers by 2016, according to Industrial Info Resources Inc. in Sugar Land, Texas. Regional estimates call for even more new hires once those projects are built. The processing […]

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Senators Urge Ban on Banks’ Physical Commodity Ownership

U.S. banks including Goldman Sachs Group Inc. (GS) should be banned from owning commodities businesses because they could threaten the institutions and global supply chains, Senators Sherrod Brown and Elizabeth Warren told the Federal Reserve . Financial holding companies “should be prohibited from owning physical assets like warehouses, pipelines and tankers,” Democrats Brown of Ohio and Warren of Massachusetts said in a letter to the Fed yesterday. “These activities pose significant safety and soundness, legal and reputational risks to the institutions.” The Fed yesterday concluded a comment period on risks posed by bank ownership and trading of commodities such as oil, gas and aluminum, and the possible benefits of imposing additional capital standards on such activities. The Fed announced on January 14 that it was seeking comment on curtailing banks’ involvement in the physical commodities business and other non banking activity. The Fed’s review of commodities activities at about […]

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Fracking to thank for lower emissions, API says

The American Petroleum Institute said hydraulic fracturing of shale reserves helped lead to the gas production increase credited with lowering U.S. emissions. The Environmental Protection Agency said the amount for greenhouse gasses emitted in 2012 — the last full year for which data are available — decreased 3.4 percent from the previous year. API spokesman Zachary Cikanek said an increase in the production of cleaner-burning natural gas was in part responsible for lower reported greenhouse gas emissions. "Innovations in hydraulic fracturing and horizontal drilling have helped make the U.S. the largest producer of natural gas in the world," he said in a statement Tuesday. "America is leading the world in reducing greenhouse gasses thanks, in part, to the revolution in natural gas production." Hydraulic fracturing, known also as fracking, is highly controversial because some of the chemicals used in the process are viewed as […]

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Canadian oil exports increase

The Canadian government said 2.7 million barrels of oil per day were exported in February, a modest increase year-on-year. The National Energy Board, the independent energy regulator in Canada, said 2.7 million bpd were exported in February, up 20,000 bpd year from the same time last year. For the first two months of 2014, Canadian oil exports were 1.5 percent higher than the same period in 2013. Nearly all of Canadian oil exports head to the United States. Canadian Prime Minister Stephen Harper has tried to add a layer of diversity to the export economy by courting Asian consumers. Last month, NEB said U.S. oil imports from Canada have increased from 16 percent of total U.S. imports in 2005 to 32 per cent in 2013. NEB’s latest set of data, published Tuesday, didn’t include export destinations. The Canadian Association of Petroleum Producers said crude oil output is expected to […]

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Analysts See 34 Billion-Cubic-Foot Addition to U.S. Natural-Gas Inventories

Analysts and traders expect government data scheduled for release Thursday to show natural-gas inventories grew last week by a smaller amount than average for this time of year. The U.S. Energy Information Administration is expected to report that storage levels rose by 34 billion cubic feet of gas during the week ended April 11, according to the average forecast of 18 analysts and traders surveyed by The Wall Street Journal. The EIA is scheduled to release its storage data for the week on Thursday at 10:30 a.m. EDT. For the April 11 week, the median estimate is for an addition of 34 bcf. Estimates range from an increase of 22 bcf to an increase of 44 bcf. The estimate for April 11 is higher than the 25 bcf added to storage for the same week last year, and slightly lower than the 37-bcf five-year average injection […]

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Personal travel growth significantly influences projected transportation energy demand

Personal travel, measured in light-duty vehicle miles traveled (VMT) per licensed driver, reached 12,900 miles per year in 2007 and decreased to about 12,500 in 2012. This shift in travel behavior is important because it directly influences light-duty vehicle (LDV) energy demand for transportation fuels such as gasoline and diesel. Recent analysis suggests that multiple factors influence travel behavior. These include economic, demographic, technological, social, and environmental determinants that have the potential to significantly shift light-duty vehicle energy consumption. Economic factors. Although economic indicators such as employment, income, and economic growth remain a dominant influence on levels of personal travel, U.S. travel indicators started to decouple from income and employment after 2007. Declines in the labor participation rate (the percentage of the total population ages 16 years and older either employed or looking for work) since the early 2000s, as well as income, fuel prices, the costs of purchasing […]

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High US Gulf Coast crude stocks spark talk of barge conversions

Talk of barging crude from the US Gulf of Mexico up to the East Coast is gaining traction as oil inventories along the nation’s refinery row continue to swell, traders said on Wednesday. Crude oil stocks in PADD III, encompassing the US Gulf Coast and home to just over half of the nation’s 17.9 million b/d refining capacity, stood at 207.2 million barrels for the week ended April 11, 2014, the highest level on record, according to Energy Information Administration data. The demand for domestic Gulf Coast crude has moved to up to include East Coast refiners but constraints on shipping from the Jones Act, which restricts shipments between US ports to US-made, owned and operated vessels, has some smaller producers and traders considering conversion of Jones Act Articulated Tug Barges (ATBs) from carrying petroleum products to carrying crude. Article continues below… Request […]

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Talks a Chance for Russia to Step Back on Ukraine

The high-level talks on Ukraine that are set to begin here on Thursday have emerged as a pivotal test of Russia ’s intentions in the region before the United States and European nations decide whether to impose additional economic sanctions on Moscow, American officials said on Wednesday.  “The idea here is that they would stop aiding and abetting and supporting these separatists and that they would pull their troops back from the border,” said a senior State Department official, referring to Western charges that Russia is behind the separatist protests in eastern Ukraine.  “If Russia does not take this opportunity to de-escalate, the costs are going to go up,” the official said. Secretary of State John Kerry will participate in the four-way meeting, which is to be held in a luxury hotel here, along with the Russian foreign minister, Sergey V. Lavrov; Ukraine’s acting foreign minister, Andrii […]

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Russia Economy Worsens Even Before Sanctions Hit

Margarita R. Zobnina, a professor of marketing here, has been watching the Russian economy’s gathering woes with mounting alarm: friends who have moved abroad with no plans to return; others who put off new business ventures because of rising uncertainty. Meanwhile, Ms. Zobnina and her husband, Alexander, also a professor, have rented a safe deposit box to hold foreign cash as a hedge against the declining ruble. Most shocking, she says, is that her local grocery is now selling anchovies packed in sunflower oil rather than olive oil, an obvious response to the soaring cost of imports. “That really freaks me out,” she said. While the annexation of Crimea has rocketed President Vladimir V. Putin’s approval rating to more than 80 percent, it has also contributed to a sobering downturn in Russia’s economy, which was in trouble even before the West imposed sanctions. With inflation rising, growth […]

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First section of South Stream pipeline manufactured

The first section of pipeline for the planned South Stream natural gas network for Europe has been manufactured, Russian energy company Gazprom said. Gazprom said pipe No. 1 — a 39-foot long, 32-inch diameter section — was produced from the Vyksa Steel Works plant in eastern Russia. South Stream is a gas transit network Gazprom plans as a way to avoid geopolitically-sensitive territory in Ukraine. Russian President Vladimir Putin said European energy security is at risk because Kiev is struggling to pay its gas bills. Ukraine hosts the bulk of the Russian natural gas bound for European consumers. Gazprom said Tuesday the first sections of pipe are scheduled for summer delivery in Bulgaria. Construction of the first leg of the pipeline is scheduled for late 2014. Gazprom Chairman Alexei Miller met in Strasbourg, France, with European Energy Commissioner Gunter Oettinger to discuss energy issues […]

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Poland referred to EU court for violating environmental rules

The European Commission said Wednesday it referred Poland to a regional court of justice for violating rules on greenhouse gases. "The European Commission has decided to refer Poland to the EU Court of Justice for failing to notify to the Commission what penalties have been put in place in case the EU rules for companies and personnel undertaking certain activities with fluorinated gases are not observed," the commission said in a statement . European law requires companies to take steps to reduce the amount of fluorinated gases, a harmful pollutant, leaked into the atmosphere. The European Commission said it sent a request to Poland to address the issue in November. The ruling follows a series of scathing reports from the Intergovernmental Panel on Climate Change warning that global climate change is out of control. The European Commission said action to curb the release of […]

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LNG answer to European energy woes, Hoeven says

The United States can help allay European energy security fears by making more liquefied natural gas available, U.S. Sen. John Hoeven , R-N.D., said from Oslo. Hoeven met with Norwegian leaders to address energy security fears in the region. He said that, while Norway has a key role to play as one of the top oil and gas suppliers in the region, it can’t solve the problem alone. "The only real, long-term solution is to make additional liquefied natural gas supplies available, and this means the United States has a strong role to play as a world leader," he said Tuesday. U.S. lawmakers have said the abundance of natural gas from shale reserves could help meet the demands of a European energy market dependent on Russia. Ongoing crises over Ukraine have put European natural gas supplies at risk because the bulk of their Russian gas supplies run through the […]

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ABCs of LNG

Current debates over LNG export often ignore its primary benefits, such as enabling gas to be produced for sale to markets beyond the realistic reach of pipelines. It also allows gas to compete with petroleum liquids where energy density is important, such as in powering ships, trains and land vehicles.  The international reaction to Russia’s annexation of Ukraine’s Crimean peninsula has put a spotlight on liquefied natural gas (LNG), which was already under debate in the US as a mechanism for exporting increasingly abundant shale gas. Meanwhile, LNG is emerging as a fuel in its own right, rather than just a means of transporting gas from source to market. What links these trends is LNG’s capability to enable natural gas to approach the convenience and energy density of petroleum. The big driver for this is economic: UK Brent crude is currently over $100 per barrel , while natural gas in the […]

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Oil Futures Mixed After China Data

On the New York Mercantile Exchange light, sweet crude futures for delivery in May traded at $103.81 a barrel at 0515 GMT, up $0.06 in the Globex electronic session. June Brent crude on London’s ICE Futures exchange fell $0.16 to $109.20 a barrel. China’s gross domestic product rose 7.4% on year in the first quarter–down from 7.7% growth in the fourth quarter last year, China’s National Bureau of Statistics said Wednesday. The reading was slightly higher than a median 7.3% gain forecast by a Wall Street Journal poll of 16 economists. "The data is better than expected, but could only have a minor positive impact," said Gnanasekar Thiagarajan, Director of Commtrendz Research in Mumbai. "The upside [for oil] seems limited due to abundant supplies." Crude-oil prices remain elevated although they have declined from their earlier highs of this month. Prices had surged on rising geopolitical tensions in Ukraine. Oil […]

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Oil Rises to 6-Week High as Ukraine Adds to Tight Market

West Texas Intermediate crude advanced to a six-week high amid concern that the crisis in Ukraine is escalating. Brent’s gains were limited by signs of slowing economic growth in China . Futures gained as much as 1 percent in New York. Ukraine began an offensive against separatists in its restive east, recapturing an airport amid claims that Russian special forces were supporting anti-government groups. China’s gross domestic product expanded by a seasonally adjusted 1.4 percent in the first quarter, down from 1.7 percent in the previous three months, according to the National Bureau of Statistics. “Oil is being driven more by the Ukraine situation,” said Guy Wolf, global head of market analytics at Marex Spectron Group in London, by e-mail. “Does this situation mean more intense disagreements elsewhere as in the Cold War ? In a tight market, such as WTI, anything can have an amplified effect.” WTI for […]

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Oil price gain tempered by China growth slowdown

The price of oil rose Wednesday as Ukraine took action against pro-Russian separatists in its east but slower Chinese growth tempered gains. Benchmark U.S. crude for May delivery was up 16 cents at $103.91 a barrel at 0835 GMT in electronic trading on the New York Mercantile Exchange. It closed Tuesday at $103.75, down 30 cents. Brent crude, used to set prices for international varieties of crude, was up 3 cents at $109.39 a barrel. Market concerns over Ukraine, which sent tanks and troops to reclaim government buildings occupied by pro-Russian gunmen in its eastern region, were offset by slower growth in China. A slump in China’s growth could reduce demand for crude. Officials from the U.S., Russia, Ukraine and the European Union are set to meet in Geneva on Thursday for negotiations aimed at persuading Russia to back off in Ukraine following its annexation of Crimea. Failing that, […]

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Gasoline Futures Hit 7 1/2-Month High on Supply Concerns

Gasoline futures rose Tuesday to their highest level since August on expectations that U.S. inventories would continue to shrink ahead of the summer-driving season. Front-month May reformulated gasoline blendstock, or RBOB, settled up 0.37 cent, or 0.1%, at $3.0421 a gallon, the highest price since Aug. 29. Meanwhile, U.S. oil prices fell from a six-week high as traders expected supplies to remain ample. Light, sweet crude for May delivery settled down 30 cents, or 0.3%, to $103.75 a barrel on the New York Mercantile Exchange. Brent crude for May delivery on the ICE futures exchange fell 33 cents, or 0.3%, to $108.74 a barrel. The May contract expired at settlement. Brent crude for June delivery rose 29 cents, or 0.3%, to $109.36 a barrel. Gasoline stockpiles have fallen for seven weeks and stood at their lowest point since […]

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Natural Gas Rises on Hopes for Early Spring Heating Demand

Natural-gas futures ended higher Tuesday as weather forecasts for colder-than-normal temperatures spurred hopes that the fuel would be needed to heat homes in much of the eastern U.S. through the end of the month. Natural gas for May delivery rose as much as 1.5% in morning trade but ended the day only 0.7 cent, or 0.2%, higher at $4.567 a million British thermal units on the New York Mercantile Exchange. Temperatures could be in the below-normal range for the Midwest and Eastern Seaboard through April 25 and remain cool in the Northeast almost until the end of the month, the U.S. National Oceanic and Atmospheric Administration said. Private forecast services had a more moderate view in the extended forecast, despite a cold blast over the Midwest and even parts of the South during the next few days that could bring near-freezing temperatures as far south as Texas. While the […]

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Iraq Shuts Down the Abu Ghraib Prison, Citing Security Concerns

The Iraqi government said Tuesday that it had closed the Abu Ghraib prison, the site of a notorious prisoner abuse scandal during the American occupation of Iraq, because of fears that it could be overrun by Sunni insurgents who have gained strength over the last year. In a statement, the Justice Ministry said it had moved 2,400 prisoners to other high-security prisons in central and northern Iraq, adding that Abu Ghraib’s location — west of central Baghdad and on the edge of insurgent-controlled areas of Anbar Province — had become a “hot zone.” It was not clear whether the closing was permanent, or if the prison might reopen if the Sunni insurgency is tamed. But it nevertheless underscored the rapid deterioration of security in Iraq since the beginning of the year, when insurgents captured Falluja, a short drive from the prison, from which hundreds of inmates escaped […]

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The big test facing Iraq

Hoshyar Zebari, Iraq’s foreign minister, looks out the cockpit window of a military helicopter at the thin blue waterway below – the site of one of the fiercest battles in modern history. The Russian-made chopper, part of Iraq’s tiny Air Force, winds its way along the Shatt al-Arab waterway, on the border with Iran, which has shaped the two countries’ tumultuous past. Skip to next paragraph At low tide, the carcasses of destroyed oil tankers are half sunk into the ocher mud. They are rusting relics from a devastating eight-year war three decades ago that began over access to the shallow ribbon of water – Iraq’s only lane to the deep-sea waters of the Gulf. "When you see it on the ground, you see how sensitive these issues are … and how stupid decisions destroyed this country," says Mr. Zebari, a onetime Kurdish guerrilla who fought Saddam Hussein’s regime […]

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24 more militants killed in Anbar offensive: Iraq

Iraqi security forces have killed 24 more militants of the Islamic State in Iraq and the Levant (ISIL) during the ongoing security operation in the restive Anbar province, the joint operations command said. Army and police forces engaged a group of militant in the Halabsa district of Fallujah, killing four and injuring many others, the command said in a press statement. Twenty other militants were killed in separate attacks across the western province, it added. The statement, however, did not indicate when these clashes took place. Since last December, the Iraqi army has waged a major offensive in the Sunni-majority Anbar province with the stated aim of flushing militants – who Baghdad claims are linked to Al-Qaeda – out of the key cities of Ramadi and Fallujah. Many local Sunni tribes opposed to Iraq’s Shiite-dominated government, meanwhile, have continued to voice anger over the […]

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Cuba fed a president’s fears and took over Venezuela

The enormous influence that Cuba has gained in Venezuela is one of the most underreported geopolitical developments of recent times. It is also one of the most improbable . Venezuela is nine times bigger than Cuba, three times more populous, and its economy four times larger. The country boasts the world’s largest oil reserves. Yet critical functions of the Venezuelan state are either overseen or directly controlled by Cuban officials. The FT’s A-List The A-List provides timely, insightful comment on the topics that matter, from globally renowned leaders, policy makers and commentators Venezuela receives Cuban health workers, sports trainers, bureaucrats, security personnel, militias and paramilitary groups. “We have over 30,000 members of Cuba’s Committees for the Defence of the Revolution in Venezuela,” boasted Juan José Rabilero, then head of the CDR, in 2007. The number is likely to have increased further since then. A growing proportion of Venezuela’s imports […]

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China economic growth slows to 18-month low in first quarter

China’s economy grew at its slowest pace in 18 months in the first quarter of 2014, official data showed on Wednesday, with signs of waning momentum already prompting limited government action to steady the world’s second-largest economy. Authorities have ruled out major stimulus to fight short-term dips in growth, and some analysts think the economy will continue to lose momentum into the middle of the year. The economy grew 7.4 percent in the January-March quarter from a year earlier, slightly stronger than the median forecast of 7.3 percent in a Reuters poll but still slowing from 7.7 percent in the final quarter of 2013. It was China’s slowest annual growth since the third quarter of 2012, when growth was also 7.4 percent. Economists were split on the outlook, with some predicting that growth had stabilized and that the government would stand pat on policy. Others, however, […]

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China’s Growth Slows to Six-Quarter Low

China’s expansion moderated to the weakest pace in six quarters and property construction plunged, testing leaders’ commitment to keep reining in credit as risks mount of a deeper slowdown. Gross domestic product rose 7.4 percent in the January-to-March period from a year earlier, the statistics bureau said today in Beijing, compared with the 7.3 percent median estimate in a Bloomberg News survey of analysts. Industrial production and fixed-asset investment trailed projections. The weakest first-quarter property-investment growth since 2009 signals credit is tight and demand is faltering, adding to economic and default dangers as Premier Li Keqiang grapples with risks from shadow banking and local-government debt. A deeper slowdown would put pressure on leaders to expand stimulus or limit the pace of changes intended to give market forces a bigger role in the world’s second-largest economy. “The property market is probably the biggest risk this year, because this is not […]

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Alaska welcomes LNG export approval

U.S. Sen. Lisa Murkowski , R-Alaska, welcomed an Energy Department decision to approve exports from a liquefied natural gas plant near Kenai, Alaska. "I’m glad ConocoPhillips will be able to add to Alaska’s 40-year history of supplying natural gas to Japan," she said in a statement Monday. The Energy Department gave Conoco approval to send as much as 40 billion cubic feet of natural gas per year from the Alaskan facility to Asian countries that don’t have a free-trade agreement with the United States. Conoco in December filed an application with the department to resume exports from a plant idled by a shortage of natural gas. Recent discoveries at Cook Inlet fields have eased supply constraints to the extent that seasonal exports are feasible. U.S. Sen. Mark Begich, D-Alaska, said in a separate statement there was "plenty of gas" available for domestic and export […]

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Slowing growth adds to China stimulus pressure

China’s growth slowed sharply in the first quarter of 2014, raising pressure on Beijing to provide a fresh round of government stimulus to prop up faltering growth in the world’s second-largest economy. In the three months to the end of March, China’s gross domestic product expanded 7.4 per cent from the same period a year earlier, a slowdown from 7.7 per cent growth in the fourth quarter of 2013 but faster than the 7.2 per cent pace that some analysts had predicted. The expansion in the first quarter, revealed by China’s National Bureau of Statistics on Wednesday, was the slowest since the third quarter of 2012 when the government loosened monetary policy and accelerated infrastructure investment as growth dropped to 7.4 per cent. China’s slowest quarterly growth in recent years was a trough of 6.2 per cent, in the immediate aftermath of the global financial crisis in 2009. […]

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Desalination Plant to Provide Third of Beijing’s Water

One-third of the tap water used in Beijing in five years will be desalinated from the sea to make it potable and boost clean supplies, according to state media. Beijing Enterprises (371) Water Group, the biggest publicly traded water-treatment company in China, is developing the reverse-osmosis project in the Caofeidian district of Tangshan in Hebei province , the Global Times reported . The city will get about 33 percent of its water daily from the treatment facility. The company said it’s planning to spend 7 billion yuan ($1.1 billion) on the plant and 10 billion yuan more on a pipeline to transport the water. Beijing Enterprises Water started desalinating seawater in 2012. Beijing has been battling drought for 15 years as China works to clean its water and air of pollutants. Xinhua News Agency reported April 12 that investigators traced the source of an oil pipeline leak that contaminated […]

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Appeals Court Upholds EPA Rule on Power-Plant Emissions

A federal appeals court on Tuesday upheld the nation’s first-ever national standards requiring power plants to cut emissions of mercury and other hazardous air pollution. The federal rules, scheduled to take effect in April 2015, require the nation’s 600 coal and oil-fired power plants to comply with emissions limits set by the Environmental Protection Agency. The standards are a notable environmental accomplishment for President Barack Obama and a blow to the coal industry, which is the biggest source of mercury emissions in the U.S., according to EPA. A divided three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit in a 61-page ruling rejected several legal attacks raised by challengers. These challengers include more than 20 states with utilities that depend heavily on coal for energy production, and several industry groups and companies, including Peabody Energy Corp. , Corp. , and the National Mining Association. […]

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EPA: US greenhouse gases dropped 3.4% in 2012 from 2011; down 10% from 2005 levels

& The US Environmental Protection Agency (EPA) released its 19 th annual report of overall US greenhouse gas (GHG) emissions, showing a 3.4% decrease in 2012 from 2011. The Inventory of U.S. Greenhouse Gas Emissions and Sinks , which is submitted annually to the Secretariat of the United Nations Framework Convention on Climate Change, presents a national-level overview of annual greenhouse gas emissions since 1990. Total emissions of the six main greenhouse gases in 2012 were equivalent to 6,526 million metric tons of carbon dioxide. These gases include carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons and sulfur hexafluoride. According to the report, GHG emissions in 2012 showed a 10% drop below 2005 levels, and were only […]

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Peak Coal

Comments about coal are usually not complimentary. Despite our dependence on it as a source of heat for electric power generation, environmentalists wish it would go away. On the other hand, advocates like to claim we have more than 110 years of coal left – “at present rates of consumption”. Both sides are overlooking crucial points. Let’s see if we can clarify the future use of coal as a fossil fuel resource. To begin with, it is important to understand not all coal is of equal quality. When I was in grade school, we lived in a house that had a coal furnace. For those who could get it, the coal of choice of home heating applications was anthracite coal because it was the cleanest burning form of coal and provided – ton for ton – the most heat. Unfortunately, we humans have used up most of the readily […]

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Russia Is Quick to Bend Truth About Ukraine

The Facebook post on Tuesday morning by Prime Minister Dmitri A. Medvedev of Russia was bleak and full of dread. “Blood has been spilled in Ukraine again,” wrote Mr. Medvedev, once favored in the West for playing good cop to the hard-boiled president, Vladimir V. Putin. “The threat of civil war looms.” He pleaded with Ukrainians to decide their own future “without usurpers, nationalists and bandits, without tanks or armored vehicles — and without secret visits by the C.I.A. director.” And so began another day of bluster and hyperbole, of the misinformation, exaggerations, conspiracy theories, overheated rhetoric and, occasionally, outright lies about the political crisis in Ukraine that have emanated from the highest echelons of the Kremlin and reverberated on state-controlled Russian television, hour after hour, day after […]

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Seeking Consensus on the Internalized Costs of Coal

What is meant by “internalized costs”? Internalized costs are the costs which can be accurately accounted for in our current systems. In energy production, these costs typically consist of capital costs, financing costs, operation and maintenance costs, and exploration costs. Some energy options incur these costs in various stages such as extraction, transportation and refinement. Profits and taxes are excluded wherever possible in order to isolate the pure cost of production. Internalized costs related to coal can become very low. That is one of the main reasons why coal has thus far proven itself to be the standout energy source of the 21 st century ( figure below ) despite rising prices, decades of talk about climate change and huge hype about alternatives. We will seek to better quantify these low internalized costs in this article. Internalized costs of coal The International Energy Agency has complied the cost curve […]

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Oil falls below $104 ahead of Ukraine meeting

The price of oil fell Tuesday ahead of talks in Switzerland that might help defuse tension between the West and Russia over Ukraine. Benchmark U.S. crude for May delivery was down 68 cents to $103.39 at 0650 GMT in electronic trading on the New York Mercantile Exchange. The contract rose 31 cents to close Monday at $104.05. Officials from the U.S., Russia, Ukraine and the European Union are set to meet in Geneva on Thursday for negotiations aimed at persuading Russia to back off in Ukraine following its annexation of Crimea. Failing that, European Union leaders could meet as early as next week to decide on tighter sanctions on Russia, a major producer of oil and gas, which has been accused of fomenting unrest in eastern Ukraine. The Ukraine government said on Sunday it was sending in troops to try to quash a pro-Russian insurgency in the region. Brent […]

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Crude-oil futures slipped in Asian trading Tuesday

On the New York Mercantile Exchange light sweet crude futures for delivery in May traded at $103.37 a barrel at 0515 GMT–down $0.68 in the Globex electronic session. May Brent crude on London’s ICE Futures exchange fell $0.42 to $108.62 a barrel. Ukraine’s acting president said Monday he isn’t opposed to a referendum on greater autonomy for regions. Pro-Russian separatists stood firm against threats of military action. Crude-oil prices have risen since the start of the month as the Ukraine crisis escalated but analysts say the rally is mostly based on technical indicators. "While there is some risk that Russian involvement could provoke western sanctions that might include an embargo on Russian oil exports it’s far from clear that there’s any consensus in support of such a measure," Citigroup said in a report. Also uncertainty about Libyan oil exports are helping limit the fall in prices, analysts said. Libya […]

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Natural-Gas Futures Slide as Producers Rebuild Inventories

Natural-gas futures fell 1.3% Monday, giving back some of last week’s gains as data suggested producers have begun restoring stockpiles that fell to an 11-year low last winter. Natural gas for May delivery fell 6 cents to $4.56 a million British thermal units on the New York Mercantile Exchange. It was the second session of losses after prices surged to a one-month high on Thursday, when the amount of gas added to stockpiles was less than expected, raising concerns that inventories wouldn’t be replenished in time to heat homes next winter. About half of U.S. homes use natural gas for heating. In a research note Monday, consultancy Gelber & Associates said pipeline flows show producers have begun extracting and shipping increased volumes of natural gas, setting up the potential for a large increase in stockpiles when definitive U.S. supply data is released Thursday. "Temperatures will have been very […]

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Natural gas output from US' Marcellus edges closer to 15 Bcf/d: EIA

Natural gas production from the Marcellus Shale in May is expected to rise 253,000 Mcf/d above April levels and move closer to the 15 Bcf/d mark, the US Energy Information Administration said Monday in its monthly report on drilling productivity. The report said gas output from the Marcellus will rise to 14.77 Bcf/d in May from 14.52 Bcf/d in April, thanks in part to a projected increase in new well production/rig to 6,501 Mcf/d in May from 6,455 Mcf/d this month. Louisiana’s Haynesville Shale has begun to show new life after drillers left the play three years ago. The agency is projecting gas production will rise to 6.615 Bcf/d in May, 11,000 Mcf/d, above April’s 6.604 Bcf/d. Production in the play peaked at about 10 Bcf/d in 2012. Article continues below… Request a free trial of: Gas Daily Gas Daily offers the most detailed […]

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Natural gas output from US’ Marcellus edges closer to 15 Bcf/d: EIA

Natural gas production from the Marcellus Shale in May is expected to rise 253,000 Mcf/d above April levels and move closer to the 15 Bcf/d mark, the US Energy Information Administration said Monday in its monthly report on drilling productivity. The report said gas output from the Marcellus will rise to 14.77 Bcf/d in May from 14.52 Bcf/d in April, thanks in part to a projected increase in new well production/rig to 6,501 Mcf/d in May from 6,455 Mcf/d this month. Louisiana’s Haynesville Shale has begun to show new life after drillers left the play three years ago. The agency is projecting gas production will rise to 6.615 Bcf/d in May, 11,000 Mcf/d, above April’s 6.604 Bcf/d. Production in the play peaked at about 10 Bcf/d in 2012. Article continues below… Request a free trial of: Gas Daily Gas Daily offers the most detailed […]

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Iran to Maintain Daily Oil Sales at 1 Million Barrels Into July

Iran anticipates maintaining crude exports at about 1 million barrels a day until at least July when a deal with global powers over its nuclear program will be renewed or expire, the nation’s deputy oil minister said. Iran is producing about 2.7 million barrels of crude a day, Ali Majedi said today in Dubai. Output may rise to as much as 3.7 million barrels daily within six months of sanctions being lifted, he said, adding the move would also open the nation’s energy industry to investment. The nation plans to outline a new oil development contract at a conference in London by November, offering overseas partners incentives. “We will introduce the new contract, plus some of the oil and gas fields for development,” Majedi said at the Middle East Petroleum and Gas Conference. Iran, the fourth-largest oil producer in the Organization of Petroleum Exporting Countries, is discussing limits to […]

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More Libyan oil expected on global market

Libya’s state-owned oil company said operations resumed at the western Zawiya oil terminal after protesters ended a blockade. More Libyan crude oil is expected to arrive on the international market after the central government brokered a deal with eastern rebel leaders to open export terminals there last week. Libya has struggled to return to its pre-civil war production level of 1.6 million barrels per day. Market tensions over energy security in Eastern Europe were countered by prospects even more Libyan oil would come from the Zawiya oil port in the west of the country. The International Monetary Fund said the Libyan energy sector represents about $63 billion to the government, a majority in terms of percentage of gross domestic product. In March, a progress report on Libya from the European Commission said a blockade on oil exports by eastern federalists has "severely" affected Libya’s fiscal situation. [ BBC ] […]

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Jordanian envoy kidnapped in Libya attack

Libya has faced insecurity and instability since Muammar Gaddafi was ousted in 2011 The Jordanian ambassador to Libya has been kidnapped in the capital Tripoli, in an attack that left his driver wounded, officials say. Libya’s foreign ministry confirmed Fawaz al-Itan’s kidnapping to the BBC, adding that his driver was in hospital. The Jordanian prime minister said that the envoy’s release was being negotiated. Libya has been plagued by instability since armed groups toppled Muammar Gaddafi from power in 2011. "The Jordanian ambassador was kidnapped this morning. His convoy was attacked by a group of hooded men on board two civilian cars," government spokesman Said Lassoued told AFP news agency. On Sunday, Libya’s newly appointed Prime Minister Abdullah al-Thinni stepped down after what he described as a "cowardly attack" on him and his family by a militia. Mr Thinni had been appointed as PM after his predecessor Ali Zeidan […]

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Israeli Gas Holds Promise of Better Ties with Neighbors

Israel’s drive to export its new-found natural gas could help to rebuild strained ties with old regional allies Egypt and Turkey, but could deprive Europe of a precious alternative to Russian gas. Israel has in recent months already signed energy deals with Jordan and the Palestinian Authority, though relations with the Palestinians are at a low ebb, and now needs to expand its export horizons to cash in on its huge energy discoveries. If all goes well, the latest developments could see first pipelines being laid between Israel and Turkey as soon as 2015, and gas cooperation between Israel and Egypt is also emerging, which would allow export access to Asia’s major markets. A growing population and soaring demand have left Egypt’s own liquefied natural gas export (LNG) plants in need of new supply, as domestic shortages eat into seaborne exports through the Suez […]

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Sinopec to Pay $1.2 Billion for Lukoil’s Stake in Kazak Assets

China Petroleum & Chemical Corp. (386) , Asia’s biggest refiner known as Sinopec, agreed to pay about $1.2 billion to buy a 50 percent stake in energy assets in Kazakhstan from Russia’s OAO Lukoil. The deal is expected to be completed before the end of the year, Lukoil said in a statement. Lukoil’s Caspian Investment Resources Ltd. owns, through a number of joint ventures, various stakes in four hydrocarbon-production projects in Kazakhstan. Lukoil’s share in commercial hydrocarbon production as part of the projects was 10.2 million barrels of oil equivalent in 2013, it said. To contact the reporter on this story: Aibing Guo in Hong Kong at [email protected] To contact the editors responsible for this story: Jason Rogers at [email protected] Madelene Pearson

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Kashagan – Back to the drawing board?

It should have turned Kazakhstan into a global oil and geopolitical champion. Instead, it turned out to be a cul-de-sac, swallowing over $50 billion since its discovery almost two decades ago. Kashagan, a mammoth-sized offshore oil field with recoverable reserves of some 13 billion barrels that stretches over more than 3000 square kilometers, was recently shut down indefinitely due to technical problems. With Kazakh ambitions scuttled and the reputation of the project-managing consortium in tatters, will it go down in history as the Titanic of oil fields? From euphoria to despair, Kashagan has been through it all. Major cost overruns, intense squabbles between major stakeholders, and insurmountable technical problems  prevented  the project from seeing daylight in 2005, as contractually required. Instead, it only began pumping the first barrels in September last year, but this lasted just a few days before the appearance of […]

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Nigeria: Shale Oil Cuts Crude Export Revenue By N181 Billion – NNPC

Nigeria’s total crude export declined by 13.45 per cent, between December 2012 and December 2013, leading to a loss of $1.134 billion, about N181.44 billion, due largely to a 90 per cent drop in crude oil exports to the United States which has stepped up production of shale oil and gas, LEADERSHIP has learnt. Specifically, the country recorded total crude export of 64.537 million barrels in December 2013, down by 10.03 million barrels from 74.564 million barrels recorded at the end of 2012. As a result, the country earned $7.299 billion, about N1.168 trillion, from crude export as at December 2013, down by $1.134 billion (N181.44 billion) from $8.434 billion, about N1.349 trillion, recorded in December 2012. KPMG Professional Services had in February warned that the discovery and exploration of shale oil and gas across the globe would put Nigeria’s economy at serious risk, unless the country was able […]

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Nigeria's Refining Capacity Rises to 26 Percent

The Nigerian National Petroleum Corporation, NNPC, has put the combined average capacity utilisation of Nigeria’s four refineries at 25.95 per cent for the month of December 2013. According to data from the NNPC’s December 2013 Monthly Petroleum Information, this is a significant improvement from the 6.46 per cent average capacity utilisation of the refineries in November 2013, and a slight decline from the 30.87 per cent utilisation year on year to December 2012. The refineries are the Kaduna Refining and Petrochemical Company (KRPC), Port Harcourt Refining Company (PHRC 1 & 2), and the Warri Refining and Petrochemical Company (WRPC). Specifically, the NNPC put the respective average capacity utilisation of the refineries in December, as: KRPC – 32.96 per cent, PHRC – 4.48 per cent, and WRPC – 40.41 per cent. According to the NNPC, 388,000 metric tonnes, MT, of dry crude oil, condensate and slop was received by the […]

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Nigeria’s Refining Capacity Rises to 26 Percent

The Nigerian National Petroleum Corporation, NNPC, has put the combined average capacity utilisation of Nigeria’s four refineries at 25.95 per cent for the month of December 2013. According to data from the NNPC’s December 2013 Monthly Petroleum Information, this is a significant improvement from the 6.46 per cent average capacity utilisation of the refineries in November 2013, and a slight decline from the 30.87 per cent utilisation year on year to December 2012. The refineries are the Kaduna Refining and Petrochemical Company (KRPC), Port Harcourt Refining Company (PHRC 1 & 2), and the Warri Refining and Petrochemical Company (WRPC). Specifically, the NNPC put the respective average capacity utilisation of the refineries in December, as: KRPC – 32.96 per cent, PHRC – 4.48 per cent, and WRPC – 40.41 per cent. According to the NNPC, 388,000 metric tonnes, MT, of dry crude oil, condensate and slop was received by the […]

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Nigeria Blast Kills Dozens as Militants Hit Capital

Emergency workers at the scene of an explosion on Monday that killed at least 71 people in Abuja. LAGOS, Nigeria — Militants struck near the heart of the Nigerian state early Monday, bombing a bus station in the capital, Abuja, just miles from the seat of government in one of the worst attacks in years in the country’s struggle with insurgents. At least 71 people were killed in a blast that ripped through dozens of vans and coaches, leaving a grim spectacle of dead and wounded. Top Nigerian officials, whose offices are a short distance away, immediately attributed the bombing to the Islamist group they have been battling for years, Boko Haram. If that turns out to be the case — and the group itself rarely acknowledges its actions — Monday’s bombing would represent a significant amplification of Boko Haram’s bloody campaign to undermine the Nigerian state. Over the […]

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China set to elevate environment over development in new law

Smog-hit China is set to pass a new law that would give Beijing more powers to shut polluting factories and punish officials, and even place protected regions off-limits to industrial development, scholars with knowledge of the situation said. Long-awaited amendments to China’s 1989 Environmental Protection Law are expected to be finalised later this year, giving the Ministry of Environmental Protection (MEP) greater authority to take on polluters. While some details of the fourth draft are still under discussion, it has been agreed that the principle of prioritising the environment above the economy will be enshrined in law, according to scholars who have been involved in the process. The fourth draft is due to be completed within weeks. "(Upholding) environmental protection as the fundamental principle is a huge change, and emphasizes that the environment is a priority," said Cao Mingde, a law professor at the China University […]

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In China, a Big Jet Becomes a Status Symbol

IN the United States, public reaction to the corporate use of business jets can be scathing when instances of obvious excess become publicized, such as the day in 2008 when the top executives of the Detroit automakers each used a private jet to fly to Washington to argue for $25 billion in taxpayer bailouts. But in China, where sales of business jets are increasing despite a lack of large scale air-system support and a dearth of airports to handle private flights, attitudes about private jets seem to be different. While forecasters had long assumed midsize and smaller jets would prevail as China’s business aviation market expanded throughout the country, that has not been the case. Instead, Chinese buyers are enthusiastically opting mostly for so-called heavy metal jets — big, long-range luxury jets that can cost $50 million or more before extras like fancy cabin fixtures. A big jet is […]

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