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Oil Futures Rise in Asian Trade, WTI Tops $100/Bbl Mark

Crude-oil futures rose in Asian trading hours Wednesday ahead of weekly data on U.S. oil stockpiles and with Ukraine continuing its crackdown on separatists. On the New York Mercantile Exchange, light, sweet crude futures for delivery in June traded at $100.15 a barrel at 0508 GMT, up $0.65 in the Globex electronic session. June Brent crude on London’s ICE Futures exchange rose $0.26 to $107.32 a barrel. Late Tuesday, the American Petroleum Institute, an industry group, said its data showed a 1.8 million-barrel drop in weekly U.S. crude stocks, while gasoline supplies rose by 2.4 million barrels and distillate stocks grew by 763,000 barrels. The more closely watched survey from the U.S. Energy Information Administration is due later Wednesday. Analysts surveyed expect an increase of 1.2 million barrels in the week ended May 2. "Seasonally, demand conditions for oil start improving toward the end of May […]

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Oil rises on industry data showing stockpile fall

The price of oil rose Wednesday after industry data showed a decline in U.S. supplies. Benchmark U.S. crude for June delivery was up 59 cents at $100.09 a barrel at 0605 GMT in electronic trading on the New York Mercantile Exchange. The contract rose 2 cents to close Tuesday at $99.50. Brent crude, a benchmark for international varieties of oil, rose 22 cents to $107.28 on the ICE exchange in London. American Petroleum Institute data on Tuesday showed a decline in U.S. crude stocks for last week, which might reflect increased demand. Traders are now looking to Energy Department figures on U.S. crude stockpiles, due later Wednesday, to confirm or debunk the API data. The data for the week ending May 2 is expected to show an increase of 1.3 million barrels in crude oil stocks and a draw of 900,000 barrels in gasoline stocks, according to a survey […]

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WTI-Brent Oil Spread Shrinks on Cushing Forecast

West Texas Intermediate crude’s discount to Brent narrowed the most in a week after Morgan Stanley said stockpiles at Cushing, Oklahoma , are weeks away from reaching minimum levels. The U.S. grade settled above $99, and Brent slid 0.6 percent. Supplies at Cushing, the delivery point for New York-traded futures, may reach a floor of around 20 million barrels in two to three weeks, Adam Longson, a Morgan Stanley analyst in New York, said in an e-mailed note yesterday. Brent dropped as two oil fields in western Libya are scheduled to resume production this week. “Historically, the minimum operating inventory level has been in the neighborhood of 20 million barrels, and we are approaching the minimum,” James Williams, an economist at WTRG Economics, an energy-research firm in London , Arkansas , said by phone. “It’s supportive for front-month WTI. It would have a tendency to narrow the price differential […]

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NYMEX June gas higher to $4.733/MMBtu as traders focus on weather

June natural gas futures pushed slightly higher early Tuesday in the US, yet remains rangebound as traders dial in on slight changes to weather forecasts until Thursday’s storage report provides the market’s next catalyst. At 8:11 am EDT (1211 GMT), the contract traded at $4.733/MMBtu, up 4.5 cents from Monday’s close. It traded overnight between $4.692/MMBtu and $4.742/MMBtu. Prices continue to trade "in the middle of the mini-range ($4.52-$4.85)," EcomEnergy analysts said, while adding "when prices are going nowhere and are in a range — it can be a good time to sell premium." The firm saw support at $4.708/MMBtu and resistance at $4.808/MMBtu. National Weather Service forecasts show a mixed pattern with above-normal temperatures in the Southeast and West over the next two weeks and below-normal temperatures taking hold in the Upper Midwest. Bentek Energy forecast supply for Tuesday at 71.7 Bcf, […]

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EIA Raises Forecast for Natural-Gas Prices

Natural gas will cost more this year, on average, than previously expected, government forecasters said Tuesday. The U.S. Energy Information Administration said natural gas will average $4.74 per million British thermal units, up 6.8% from its forecast last month, as supplies are likely to stay tight. The country’s shale boom is encouraging power plants and industrial consumers to use more gas than expected, but the boom hasn’t produced as much supply as expected this year, the EIA said. The agency’s short-term forecast predicts the gas industry will need to produce more in November and December to catch up and match consumer demand of 72.3 billion cubic feet a day in 2014, up 0.22 billion cubic feet a day from last month’s forecast. Gas prices have been rising this spring as investors question whether even record production could match unrelenting demand. Forecasters now say average prices from April through […]

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Libyan ports Es Sider, Ras Lanuf still closed as deal splinters: US ambassador

The reopening of the Es Sider and Ras Lanuf oil ports in eastern Libya remains in limbo as the government appears to be backing away from a deal with rebels negotiated by ousted Prime Minister Ali Zidan, the US ambassador to Libya said Tuesday. "We have no way of knowing" if the ports would reopen, Ambassador Deborah Jones said in a conference call with US businesses considering investing in Libya. "I’m not terribly optimistic in large part because there was not a lot of buy-in in the General National Council, their parliament, for the terms of the deal." Ras Lanuf and Es Sider, which have a combined capacity of 560,000 b/d, have been closed since rebels seeking more autonomy took over the ports last August. Article continues below… Oilgram News brings you fast-breaking global petroleum and gas news on and including: Industry players, upstream […]

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Angola May Miss 2015 Oil-Output Target

Angola, Africa ’s second-biggest oil producer, probably won’t reach an output target of 2 million barrels a day next year because new projects will be too late to boost declining flows, Wood Mackenzie Ltd. said. Sonangol EP, the state oil company, said in a statement May 5 that the target remains in place after government-run newspaper Jornal de Angola reported that the goal was deferred to 2017. The Organization of Petroleum Exporting Countries member pumped 1.54 million barrels a day last month, according to data compiled by Bloomberg. “I don’t think 2 million barrels a day by next year is realistic,” David Thomson , a Wood Mackenzie analyst in Edinburgh, said in an e-mailed response to questions. “I am confident it will happen, but toward the end of the decade.” Total SA’s CLOV fields in Block 17 and Eni SpA’s Western Hub in Block 15/06 are expected to start […]

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Israeli gas may be bound for Egypt

Noble Energy said it was considering sending as much as 440 trillion cubic feet of natural gas per day from the Tamar field offshore Israel to a plant in Egypt. Noble and its field partners at Tamar signed a non-binding letter of intent with Union Fenosa Gas to deliver natural gas to a facility that can turn it into super-cooled liquefied natural gas. The letter of intent spells out a 15-year term for a total 2.5 trillion cubic feet of natural gas from Tamar. "This LOI with Union Fenosa Gas represents a major milestone for our Tamar asset and is indicative of the strong regional demand for natural gas," Keith Elliot, Noble’s vice president in charge of regional operations, said in a statement Tuesday. Spanish company UFG holds an 80 percent stake in the subsidiary controlling the Damietta LNG facility in Egypt. It has […]

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Iran says its gas could reach Iraqi market

A deputy oil minister in Iran said Tuesday there could be natural gas sent to power stations in southern Iraq during the current calendar year. Ali Majedi, Iran’s deputy oil minister for international affairs, said a pipeline from southern Iran across the border to power stations in Basra province is "currently under construction." The pipeline will stretch from the Iranian port city of Asaluyeh, near the South Pars gas field, to Iraq. Iran has boasted of its potential to reach new gas customers through South Pars, which is one of the largest gas complexes in the world. Iran shares the field with Qatar. European officials have brushed off Tehran’s gas offerings because of sanctions imposed on the Iranian energy sector. Though Iran secured some sanctions relief through an interim nuclear deal with Western powers last year, the U.S. government in particular has said Iran […]

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Iran keeps links to Chinese energy companies

Chinese companies are still welcome in Iran’s energy sector, but those not meeting their obligations are a source of frustration, the oil minister said Tuesday. Iranian Oil Minister Bijan Zanganeh last week said a contract with China National Petroleum Corp. for development of the South Azadegan oil field was torn up because the company wasn’t meeting Iran’s expectations at a field said to hold more than 40 billion barrels of oil. The minister said Tuesday there was a continued interest with working with Chinese companies, though the government was so far not happy with their performance. "[The] ministry has by no means any intention of removing Chinese companies and investors from [Iran’s] petroleum industry, but Iran has ended its cooperation with the Chinese firms that have not fulfilled their obligations in some projects," he said . CNPC was given a contract from the Iranian […]

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Iran Targets Oil Boost of 1 Million Barrels a Day, Zanganeh Says

Iran , hampered by sanctions over its nuclear program, plans within four years to boost crude-output capacity by 1 million barrels a day at fields it shares with neighboring states, Oil Minister Bijan Zanganeh said. “This will be the biggest achievement in the history of the oil industry in Iran,” he said today at the opening of an energy conference in Tehran. The fourth-largest producer in the Organization of Petroleum Exporting Countries is also pressing ahead with work at South Pars, part of a gas deposit straddling the border with Qatar, Zanganeh said. Iran expects to complete several of the project’s 17 phases in about three years, he said. The government is trying to attract foreign investment in crude, natural gas and chemicals production even as it seeks the removal of U.S. and European sanctions. The U.S. and allied states say Iran is working to develop atomic-weapons technology, a […]

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U.S. Imposes First Sanctions in South Sudan Conflict

In its first use of economic sanctions against combatants in the bloody fighting in South Sudan , the Obama administration on Tuesday ordered asset freezes and travel bans on two individuals, one on each side of the conflict. The sanctions, which were announced by Secretary of State John Kerry , were imposed under an executive order President Obama signed a month ago in response to the violence that has killed thousands and displaced more than a million people. The announcement came as President Salva Kiir of South Sudan and Riek Machar, the rebel leader, agreed to face-to-face talks in Ethiopia, which are tentatively scheduled to be held on Friday. One of the targets of the sanctions was Marial Chanuong, the commander of the government’s presidential guard force, who Mr. Kerry said led attacks against civilians in and around Juba, the South Sudan capital. The other was Peter […]

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Mexico sees first private oil contracts in 2015

Mexican officials said Monday they expect to open bidding on the first round of private oil contracts in the first half of 2015. A constitutional reform passed last year opened the state-owned energy sector to private investment. But enabling legislation is still before congress. Assistant Energy Secretary Lourdes Melgar said the first round of bidding is expected to offer a range of onshore, offshore and deep water fields. Melgar said Mexico hopes to have private companies producing a half million barrels of oil a day by 2018, while state-owned oil company Petroleos Mexicanos should maintain production at about 2.5 million barrels a day. Mexican tax authorities said they expect government revenue, on average, to be about 50 percent of production value from private projects operated under contract, license or concession. Petroleos Mexicanos, known as Pemex, will have first choice of which fields to develop. Those […]

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Ecuador Says No National Referendum on New Amazon Oil Development

Ecuador’s national electoral council said Tuesday that opponents of new oil development in a national park in the Amazon rain forest failed to submit enough valid signatures to force a nationwide referendum. The electoral council said that only 359,761 signatures of the 756,000 that were submitted by a coalition opposed to the oil activity passed the validation process. The law required them to collect 584,000 signatures, which is equivalent to 5% of the electorate, to force a referendum on the issue. The announcement appears to be a victory for President Rafael Correa and his plans to drill for oil in an area known as the Ishpingo-Tambococha-Tiputini, or the ITT block. A portion of the block is located in the Yasuni national park, which is considered by scientists to be one of the most biologically diverse spots in the world. The president of the electoral council, Domingo […]

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Mexico's Mature Oil Fields Key to Near-Term Production Gains

Mexico expects an increase in crude-oil production in the next few years to come primarily from the reactivation of mature oil fields, which would be included along with other types of deposits in the first rounds of bidding involving private companies. "Additional production will come for example from mature oil fields…fields that were producing in the 1930s and that could be exploited with new technology to increase production quickly," Lourdes Melgar, deputy minister for hydrocarbons at the Energy Ministry, said Tuesday at a meeting with reporters. The attraction of new, latest-generation technology is one of the central goals behind a historic energy overhaul promoted by President Enrique Peña Nieto that opens the oil and gas industry to competition, ending the monopoly of state company Petróleos Mexicanos, or Pemex, and allowing private firms to exploit the country’s resources for the first time in 76 years. Last week, Mr. Peña […]

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Mexico’s Mature Oil Fields Key to Near-Term Production Gains

Mexico expects an increase in crude-oil production in the next few years to come primarily from the reactivation of mature oil fields, which would be included along with other types of deposits in the first rounds of bidding involving private companies. "Additional production will come for example from mature oil fields…fields that were producing in the 1930s and that could be exploited with new technology to increase production quickly," Lourdes Melgar, deputy minister for hydrocarbons at the Energy Ministry, said Tuesday at a meeting with reporters. The attraction of new, latest-generation technology is one of the central goals behind a historic energy overhaul promoted by President Enrique Peña Nieto that opens the oil and gas industry to competition, ending the monopoly of state company Petróleos Mexicanos, or Pemex, and allowing private firms to exploit the country’s resources for the first time in 76 years. Last week, Mr. Peña […]

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Vietnam Demands China Withdraw Oil Rig From Disputed Waters

Vietnam said it would take all measures necessary to protect its legitimate interests in the South China Sea after a Chinese state-run oil company . Vietnamese Minister of Foreign Affairs Pham Binh Minh, in a telephone call to Chinese State Councilor Yang Jiechi Tuesday, said the deployment of the oil rig by China National Offshore Oil Corp. and the presence of several Chinese vessels in the area violated international laws and Vietnam’s sovereignty, according to a government statement late Tuesday. On Saturday, China’s Maritime Safety Administration disclosed the location of the oil rig. Vietnam says the rig is 138 miles (220 kilometers) from its shore and "totally within its exclusive economic zone." At a press briefing on Monday, China Foreign Ministry spokeswoman Hua Chunying said the rig was in Chinese waters. "As we understand it, the Chinese Maritime Safety Administration issued a shipping notice on May 3 regarding […]

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Chinese and Vietnamese Ships Collide Amid Oil Rig Dispute

Tensions in the South China Sea intensified Wednesday as Vietnamese naval vessels collided with Chinese ships amid a heated standoff over an oil rig that China had placed off Vietnam’s coast. Officials said that no shots were fired during the incident, and further details about the collision, which was confirmed by a Vietnamese official to The Associated Press, were not available. But the collision highlighted the hair-trigger tensions in the region as East Asian nations try to contain China’s more aggressive posture in pursuing maritime claims in the South China Sea. The collision occurred just days after the Chinese state oil company Cnooc stationed the rig 120 nautical miles off the coast of Vietnam, in waters claimed by China and Vietnam. The placement of the rig led to protests and demands by Vietnam that it be withdrawn, and the deployment of a Vietnamese naval flotilla to […]

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Oil sent from Canada by rail increasing

Crude oil exported from Canada by rail topped 140,000 barrels per day during fourth quarter 2013, nearly double the 2012 figures, a regulator said. The National Energy Board, Canada’s energy regulator, published quarterly data for crude oil exports by rail Monday. It said that, combined, 184,907 barrels of oil per day were delivered by rail over 2012, with more than 40 percent of that volume sent during the fourth quarter. Fourth quarter 2012 exports by rail were 79,763 bpd, compared with the 146,047 bpd sent during fourth quarter 2013. Overall 2013 deliveries by rail were 502,215 bpd. An accelerated rate of crude oil production in North America has strained existing pipeline capacity. Industry officials say rail transport is taking up the slack. Increased crude oil deliveries by rail corresponded with an increase in derailments. More than 40 people were killed last year in Lac-Megantic, Quebec, when a train carrying […]

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U.S. study blames fossil fuels for climate change

A U.S. government report published Tuesday finds the change in weather patterns over the least 50 years is tied largely to the burning of fossil fuels. The National Climate Assessment finds the U.S. average temperature has increased by as much as 1.9 degrees Fahrenheit since record keeping began in 1895, and most of that increase has occurred since the 1970s. "The global warming of the past 50 years is primarily due to human activities, predominantly the burning of fossil fuels," the report finds. The 840-page report said that climate change has "moved firmly into the present," with the economies in all U.S. territories feeling the impact. "This National Climate Assessment concludes that the evidence of human-induced climate change continues to strengthen and that impacts are increasing across the country," it said. The report finds the amount of warming projected during the next few decades […]

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Climate Change Study Finds U.S. Is Already Widely Affected

The effects of human-induced climate change are being felt in every corner of the United States, scientists reported Tuesday, with water growing scarcer in dry regions, torrential rains increasing in wet regions, heat waves becoming more common and more severe, wildfires growing worse, and forests dying under assault from heat-loving insects. Such sweeping changes have been caused by an average warming of less than two degrees Fahrenheit over most land areas of the country in the past century, the scientists found. If greenhouse gases like carbon dioxide and methane continue to escalate at a rapid pace, they said, the warming could conceivably exceed 10 degrees by the end of this century. “Climate change, once considered an issue for a distant future, has moved firmly into the present,” the scientists declared in a major new report assessing the situation in the United States. “Summers are longer and hotter, and extended […]

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Short-Term Energy Outlook

Highlights During the April-through-September summer driving season this year, regular gasoline retail prices are forecast to average $3.61/gallon (gal), 3 cents higher than last year and 4 cents higher than projected in last month’s STEO. The projected monthly national average regular gasoline retail price falls from $3.72/gal in May to $3.51/gal in September. EIA expects regular gasoline retail prices to average $3.48/gal in 2014 and $3.39/gal in 2015, compared with $3.51/gal in 2013. Brent crude oil spot prices averaged $108/barrel (bbl) in April. This was the 10th consecutive month in which the average Brent crude oil spot prices fell within a relatively narrow range of $107/bbl to $112/bbl. New pipeline capacity from the Midwest into the Gulf Coast helped reduce inventories at the Cushing, Oklahoma storage hub to 25 million barrels by the end of April, the lowest level since October 2009. The discount of WTI crude oil to […]

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Florida’s Fuel Dwindling as State Braces for Hurricanes: Energy

Florida , the biggest gasoline market on the U.S. East Coast, is enduring a supply squeeze and higher prices just a month before the start of the hurricane season . The state, surpassed only by California and Texas in gas consumption, has no refineries and relies on tanker and barge deliveries for 97 percent of its supply. Retail gasoline has risen to the third-highest level ever seasonally and stockpiles are about 7 percent lower than a year ago. Florida’s fuel market underscores how the shale-oil revolution created winners and losers, with the Gulf Coast awash in cheap crude and other regions missing out because they lack transportation and refining capacity. A shortage of U.S.-flagged tankers that Florida relies on for deliveries and hurricanes after June 1 may spur higher prices. “People are thinking we’re flush with oil and that there’s more stability and lower prices,” Ryan Mossman, a vice […]

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EIA Proposes Crude Gravity Survey

The Energy Information Administration wants to start collecting information about the density of oil produced in the U.S. to better inform the debate over lifting restrictions against crude exports. The agency, which is the statistical arm of the Energy Department, would begin publishing the average API gravity and sulfur content of domestic crude oil on a state-by-state basis in December 2015, under a proposal published today in the Federal Register, according to Jim Kendell, who heads the EIA’s Office of Oil, Gas and Coal Supply Statistics. Companies such as Exxon Mobil Corp. (XOM) have urged the U.S. government to ease restrictions against most exports of unrefined crude from the U.S. Others, such as Valero Energy (VLO) Corp., say the U.S. is benefiting from existing rules. One issue at the center of the debate, the EIA said in its proposal, is the density of U.S.-produced oil. Proponents of lifting export […]

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Both sides bury dead as Ukraine slides towards war

Both sides have been burying their dead as Ukraine slides further towards war, with supporters of Russia and of a united Ukraine accusing each other of tearing the country apart. Tuesday was generally quieter than past days in most of eastern and southern Ukraine, but violence flared at dusk in the eastern port of Mariupol, where a spokesman for pro-Moscow militants told Russia’s Itar-Tass news agency that one person was killed and three wounded in an attack on a checkpoint. In Kramatorsk, a separatist-held town in the east that saw an advance by Ukrainian troops at the weekend, the coffin of 21-year-old nurse Yulia Izotova was carried through streets stilled by barricades of tires and tree trunks on Monday. Scattered red carnations traced the route. At the Holy Trinity Church, seven priests led mourners in prayer for a woman killed by large caliber bullets, which […]

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Crude Recovers Ground But Still Feels Oversupply Pressure

Brent WTI crude futures recovered somewhat Tuesday after falls in the prior session, but with limited upside apparent in a well-supplied global market. Brent crude for June delivery was up 13 cents at $107.85 a barrel on ICE Futures Europe. WTI crude for June delivery was up 14 cents at $99.62 a barrel on the New York Mercantile Exchange. Morgan Stanley says a bearishness is likely to continue, in a climate of high supply and refinery maintenance. "Non-OPEC supply growth remains elevated, while turnarounds and returning supply from Brent crude oil outages should keep price action muted in [the second quarter]," they wrote in a note to clients. "However, fundamentals turn more bullish in [the third quarter]," they wrote, as maintenance season ends at refineries and they require more crude. The other factor exerting downward pressure on prices continues to be Libya, and its promised return […]

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Natural Gas Prices End Three-Session Skid as Weather Pushes Demand

Natural-gas futures narrowly ended a three-session skid Monday as weather-related demand highlighted doubts about producers’ abilities to replenish stockpiles. Prices for the front-month June contract rose 1.4 cents, or 0.3%, to $4.688 a million British thermal units on the New York Mercantile Exchange. Monday’s incremental gain puts natural gas back within 3% of the two-month high it hit early last week before the string of losses. Natural gas prices have stayed relatively flat day-to-day as traders are divided about the dueling influences of record supply and growing demand. Unseasonably high temperatures that are pushing demand for air conditioning and gas-fired electricity helped prices rise as high as $4.73/mmBtu Monday morning, but those gains faded in the afternoon. "I’m still a little surprised," said Kyle Cooper, managing director of research at IAF Advisors, a Houston consulting firm. "The market just seems very, very complacent." Cooper and […]

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IAEA Inspectors Commence Iran Visit Ahead of Nuclear Talks

Inspectors from the United Nations atomic agency arrived in Iran to visit sites related to the country’s nuclear program before talks between the Islamic republic and world powers resume next week. International Atomic Energy Agency Inspectors, who landed in Tehran today for the two-day trip, are expected to visit the Saghand uranium mine and the Ardakan concentration plant, state-run Press TV news channel reported, citing Behrouz Kamalvandi, spokesman for Iran’s Atomic Energy Organization. Iran has agreed to provide relevant nuclear information and managed access to these sites in line with seven “practical steps” agreed to in February with the IAEA to shed more light on its nuclear activities. The measures need to be implemented by May 15. Iranian officials and the IAEA will also discuss today the nation’s Arak heavy-water reactor, state-run Mehr news agency reports. The reactor has been a source of concern for the U.S. and its […]

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Dozens dead in continuing Iraq violence

Violence in Iraq, including shelling in a rebel-held city and an attack targeting Shia pilgrims, has killed more than 30 people in 24 hours, officials have said. It came as officials counted ballots from the April 30 general election, the first since US troops withdrew in late 2011, and amid a protracted surge in nationwide unrest that has sparked fears of a return to the large-scale sectarian killing sprees of 2006-2007. In Fallujah, just a short drive west of Baghdad, shelling in southern areas of the city killed 11 people and wounded four others, Ahmed Shami, a doctor, said. It was not immediately clear who was behind the bombardment, which began on Saturday evening and continued into Sunday. In a sign of the significant power of anti-government fighters, all of Fallujah and parts of Anbar provincial capital Ramadi, farther west, have been out of government control since early January. […]

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South Sudanese Army Seizes Town Used as Base by Rebel Leader

South Sudanese government forces seized the stronghold of the country’s rebel leader and the capital of oil-rich Unity state from insurgents, drawing criticism from the U.S. for violating a January truce. Government forces yesterday retook Unity’s capital, Bentiu, and Nasir, the town in neighboring Upper Nile state used as a base by former Vice President Riek Machar, army spokesman Philip Aguer said by phone today from the national capital, Juba. Rebel spokesman Mabior Garang confirmed the army had recaptured the towns. “It’s not a fragile takeover,” Aguer said. Nasir is “very crucial because that was the headquarters of Riek Machar.” The government expects attacks on the oil-producing state to cease as a result, he said. Fighting erupted in the world’s newest nation on Dec. 15 with President Salva Kiir accusing Machar of leading a coup, a charge Machar denies. Violence has left thousands of people dead and forced more […]

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Transcorp to Start Drilling Plans After Nigeria Oilfield Deal

Transnational Corp. of Nigeria Plc , which has interests ranging from agriculture to oil, said it will drill wells on its prospecting lease after signing a production-sharing deal with the state oil company. Transcorp paid $30 million for oil-prospecting lease 281, or OPL 281, following a sale by the Nigerian government in 2007. The lease holds an estimated 104 million barrels of oil reserves, 335 million barrels of probable additional reserves and about 4 trillion cubic feet of gas, the Lagos-based company said today in an e-mailed statement. “We are excited by this development and the opportunity to fully exploit the huge reserves and gas resources,” said company Chairman Tony Elumelu. “We will produce enough gas to run our Ughelli plant to its current installed capacity of 1,000 megawatt and expand this to over 3,000 megawatt in the near future.” Transcorp, 44 percent owned by Elumelu, was set up […]

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Marxist Rebel Bombings Send Colombia Oil Output to 20-Month Low

Colombian crude production sank to a 20-month low in April as Marxist rebel attacks and community protests curbed output amid continuing peace talks in Havana . Oil production last month averaged 935,000 barrels per day, according to a government statement yesterday, the lowest since August 2012. Output slumped as repairs to the country’s second-largest pipeline following a March 25 rebel attack were prevented by the indigenous U’wa group. Paralysis at the Cano Limon-Covenas duct, which takes oil from eastern Colombia to the Caribbean coast, forced producers including state-controlled Ecopetrol SA (ECOPETL) to restrict output as storage ran out. Oil is Colombia’s biggest export and a key source of revenue for the government. There were 33 pipeline attacks in the first quarter of this year and a total of 259 in 2013, as Colombia’s largest rebel group, the Revolutionary Armed Forces of Colombia, or FARC, seeks to strengthen its hand […]

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Cnooc Oil Rig Fuels Vietnam-China Tensions

Vietnam accused a Chinese energy company of operating in its waters illegally, potentially ratcheting up tensions further between the two countries. On Saturday, China’s Maritime Safety Administration disclosed the location of China National Offshore Oil Corp.’s HD-981 oil rig. The area is in part of the South China Sea that Vietnam claims as its "exclusive economic zone," said Vietnamese Foreign Ministry spokesman Le Hai Binh. "All activities by a foreign entity in Vietnamese waters without Vietnam’s consent are illegal and invalid, and Vietnam strongly protests [such activities]," Mr. Binh said in a statement posted on the government’s website late Sunday. The area the Cnooc rig is operating in is "only 120 nautical miles from Vietnam’s shore," the statement added. At a daily press briefing on Monday, China Foreign Ministry spokeswoman Hua Chunying said the rig was in Chinese waters. "As we understand it, the Chinese Maritime Safety Administration issued […]

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China Starts 19th Nuclear Power Reactor Amid Construction Push

China fired up its 19th nuclear reactor as the nation pushed to more than double its expansion of atomic power generation capacity this year, which may boost demand for imported uranium. The Ningde No. 2 reactor in the southern province of Fujian started commercial operations yesterday, according to a statement posted on the website of the State Council’s State-owned Assets Supervision and Administration Commission today. The facility is owned by China General Nuclear Power, the nation’s biggest nuclear producer. Its No. 1 reactor resumed production on April 29 after maintenance , the statement shows. China may need to import more than 80 percent of its uranium by 2020 as it expands its nuclear construction and operations, compared with about 60 percent currently, Tian Miao, an analyst at North Square Blue Oak Ltd., a London-based policy researcher, said by phone today. The nation will add 8.64 gigawatts of atomic capacity […]

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Obama Intensifies Focus on Climate With New Assessment Report

President Barack Obama will argue this week that the effects of climate change must be confronted now, intensifying his focus on the issue a month before new and contentious rules are due out that will regulate emissions from existing power plants. Tuesday’s release of a report called the national climate assessment will kick-start the administration’s push on an issue the president views as a key component of his legacy. The document, mandated by Congress and written by a federal advisory panel, will assess the impact global warming will have on specific regions of the country and sectors of the economy. The report and a series of events in the next few days offer Mr. Obama an opportunity to reassure his liberal allies, who have long urged a more aggressive approach to climate change. Mr. Obama has told environmental leaders, including some top Democratic donors, his administration is ready to […]

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Oxy production up nearly 4 percent year-on-year

U.S. energy company Occidental Petroleum said Monday its domestic oil production increased 3.7 percent from the same time last year. Occidental said its oil and gas business generated $2.1 billion in earnings during the first quarter of 2014, compared with $1.9 billion during first quarter 2013. "We continued to focus on our domestic production growth strategy, growing our oil production to 274,000 barrels per day," President and CEO Stephen Chazen said in a statement . "This was an increase of 10,000 barrels per day on a year-over-year basis and 4,000 barrels per day on a quarter-over-quarter basis." Occidental, commonly referred to as Oxy, credited its strong performance with higher oil and natural gas prices. In the Middle East and North African sector, the company said its production declined 14,000 barrels of oil per day compared with the same time last year because of port […]

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BP has record 11 deepwater rigs running in Gulf of Mexico: BP America CEO

Four years after the Macondo oil spill, BP has 11 operated rigs running in the US Gulf of Mexico, the most the company has ever had there at one time, BP America’s CEO said Monday. BP will spend $10 billion over the next five years in the deepwater US Gulf, which amounts to about 10% of its worldwide exploration and production budget and makes the company the largest investor in that arena, said John Minge, who is also BP America’s chairman and CEO. "Our business is back; it’s strong and it’s gaining momentum," Minge said. "It wasn’t long ago when the common belief was that the region was played out, that deepwater wasn’t going to work and it was better to head off to other places. But we had [employees] who said there’s more there, and convinced the leadership to invest further." Minge was […]

Posted On : Published By : Tom Whipple
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Rail service returning to Lynchburg, Va.

Some of the railcars involved in last week’s accident involving a train carrying crude oil through Lynchburg, Va., were moved, CSX Corp. said. The rail company said rail operations resumed late Sunday, allowing some of the cars involved in last week’s accident to be reset and moved. "Over the next day or two, product will be removed from the remaining cars," the company said in a Sunday statement . "Once complete, those cars will then be moved out safely." Some of the rail cars involved in the accident were carrying crude oil from the Bakken reserve area in North Dakota to a Virginia refinery. U.S. regulators in January warned Bakken crude oil may be more flammable than other grades. Three railcars involved in the accident caught fire, though no injuries were reported from the accident. CSX said last week it pulled two railcars […]

Posted On : Published By : Tom Whipple
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Ukraine Unrest Intensifies as Toll Rises From Offensive

Surging casualties are threatening to undermine Ukraine’s campaign to regain ground from pro-Russian militants in its easternmost cities, where insurgents killed four government troops and downed a military helicopter. Four government servicemen died yesterday in fighting that may have killed about 30 rebels, acting Interior Minister Arsen Avakov said on his Facebook account. French President Francois Hollande said he warned Russian President Vladimir Putin that Europe would continue to pressure him to let Ukraine hold a May 25 presidential election and if it is thwarted, “chaos and a risk of war” would follow. “We must do everything to avoid civil war,” Hollande said on France ’s BFM TV-RMC radio today. “You know when it starts but never when it ends.” Efforts by the government in Kiev to expel insurgents from the easternmost regions are at risk of stalling less than three weeks before the ballot. German Chancellor Angela Merkel […]

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Europe Must Embrace Fracking, U.K. Energy Minister Says

The Ukraine crisis has become a “wake-up call” for European governments on the need to develop local energy resources, including natural gas from shale, U.K. Energy Minister said. The use of hydraulic fracturing, or fracking, to tap shale reserves that could meet demand for decades would provide greater security of supply at a time when Russia has threatened to curb gas shipments needed to power European economies, he said in an interview in Houston yesterday. “We have to ensure that we do maximize our indigenous resources,” Fallon said. “We can’t be reliant on dodgy parts of the world.” Escalating violence in Ukraine fanned by Russian separatists has intensified calls to develop local prospects, especially in countries such as Bulgaria that are more reliant on Russian gas, he said. Russia provides about a third of the EU’s oil and gas needs, mainly via state-controlled OAO Gazprom (GAZP) and OAO Rosneft […]

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Dirty U.S. Coal Finds a Home in Europe

Even as it faces increased regulatory scrutiny at home, America’s dirty and unwanted coal is being embraced in one of the world’s cleanest energy markets: the European Union. At the biggest power plant in the U.K., operated by Drax Group PLC, a small black mountain of a million tons of coal sits at the base of a dozen 374-foot cooling towers. Much of it is high-sulfur coal from under the plains of Illinois and Indiana—exactly the kind of high-emission, power-plant fuel receiving closer scrutiny from U.S. regulators and courts. Last week, the Supreme Court ruled in favor of enforcing regulations that require power plants in 28 states to cut coal emissions that blow across state lines. Many U.S. power plants were already reducing emissions in anticipation of tougher Environmental Protection Agency rules that take effect in 2015. Now, the Supreme Court ruling could affect 1,000 power plants in […]

Posted On : Published By : Tom Whipple
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China’s coal solution has carbon downside across globe

Global carbon-dioxide emissions are climbing at rates that pose severe risks to the planet, and reversing that trend is heavily dependent on China making cuts in its emissions. This coal-to-gas plant built by Datang International is the first of its kind in Inner Mongolia. It creates methane that can be piped to Beijing, where it can be used as a cleaner burning fuel to reduce air pollution. But the plant itself can send out quite a stench. LOSING GROUND The struggle to reduce CO2 During the next three days, reporter Hal Bernton will bring you stories from the front lines of China’s changing energy industry. This is kickoff of an occasional series on the challenges of reducing carbon emissions. Read more → The new coal plant here is an industrial fortress of boilers, tanks and towers that stretches across a lonely plateau in Inner Mongolia. All day long and […]

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Shale Drillers Feast on Junk Debt to Stay on Treadmill

Rice Energy Inc. (RICE) , a natural gas producer with risky credit, raised $900 million in three days this month, $150 million more than it originally sought. Not bad for the Canonsburg, Pennsylvania-based company’s first bond issue after going public in January. Especially since it has lost money three years in a row, has drilled fewer than 50 wells — most named after superheroes and monster trucks — and said it will spend $4.09 for every $1 it earns in 2014. The U.S. drive for energy independence is backed by a surge in junk-rated borrowing that’s been as vital as the technological breakthroughs that enabled the drilling spree . While the high-yield debt market has doubled in size since the end of 2004, the amount issued by exploration and production companies has grown nine-fold, according to Barclays Plc. That’s what keeps the shale revolution going even as companies spend […]

Posted On : Published By : Tom Whipple