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US EIA Cuts Recoverable Monterey Shale Oil Estimate By 96%

NEW YORK, May 21 (Reuters) – The U.S. Energy Information Administration (EIA) on Wednesday cut its estimate of recoverable oil in California’s Monterey shale by 96 percent, casting doubt on what was once thought to be America’s next major energy play. In what could be welcome news for environmentalists and a potentially bad omen for oil drillers, such as Venoco Inc, with large leases in the region, the EIA slashed its forecast of technically recoverable reserves, citing production difficulties from initial wells. The reserves were downgraded by 96 percent, from 13.7 billion barrels estimated by a government-funded report in 2011, to just 600 million barrels, the EIA said. A detailed report is expected to be released next month. "The EIA concluded that the technical recoverability of Monterey shale did not look as strong in 2014 because of the industry’s difficulty in producing from the region," EIA head Adam Sieminski […]

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Sanchez to buy Eagle Ford acreage from Shell for $639 million

Sanchez Energy Corp. , Houston, has agreed to acquire 100% working interest in 106,000 net acres in Dimmit, LaSalle, and Webb Counties, Tex., from Royal Dutch Shell PLC for $639 million, effective Jan. 1. The agreement is expected to close at the end of the second quarter. The sale includes 176 operated producing wells and associated field facilities and infrastructure. The assets consist of 60 million boe of proved reserves and 24,000 boe/d of average first-quarter production, with 60% liquids. Sanchez’s total position in the Eagle Ford will amount to 226,000 acres with as many as 3,000 potential drilling locations. The company’s average production rate for this year’s first quarter will rise to 42,800 boe/d, which includes an estimated Catarina production rate of 20,000 boe/d. Total proved reserves will increase 100% to 119 million boe. The acquired assets are expected to generate a substantial amount of near-term cash flow […]

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US forecasters to predict slow hurricane season

Federal forecasters are expected to predict a slower than usual hurricane season this year. Experts from the National Oceanic and Atmospheric Administration will gather in New York on Thursday to release the agency’s outlook for the six-month storm season that officially begins June 1. Colorado State University researchers have forecast nine named storms in 2014, with just three expected to become hurricanes and one major storm with winds over 110 mph. Forecasters got it wrong last year when they predicted an unusually busy hurricane season. There were just 13 named storms and two Category One hurricanes, Umberto and Ingrid. There were no major hurricanes. Officials plan to roll out high-resolution maps that will show people where to expect storm surge. The maps were promised last year and are being implemented for the 2014 season. Storm surge was devastating to the New York area when Superstorm […]

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Winter hit consumers' pocketbooks, U.S. says

U.S. consumer bills during the last two quarters were more than 4 percent higher year-on-year because of a harsh winter, the Energy Department said. The Energy Information Administration, the statistical arm of the Energy Department, said Wednesday consumer expenses during fourth quarter 2013 and first quarter 2014 were 4.4 percent, or about $14 billion, higher than the same time last year. "Cold weather east of the Rocky Mountains led consumers to pay more to heat their homes but less to fuel their cars," EIA said . An arctic blast brought on by a weather phenomenon known as a polar vortex pushed temperatures well below the freezing point in U.S. states east of the Mississippi River for much of the winter season. U.S. consumers spent 27 percent, or $6 billion, more on heating oil and propane than the previous winter. While those fuels typically make up […]

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Winter hit consumers’ pocketbooks, U.S. says

U.S. consumer bills during the last two quarters were more than 4 percent higher year-on-year because of a harsh winter, the Energy Department said. The Energy Information Administration, the statistical arm of the Energy Department, said Wednesday consumer expenses during fourth quarter 2013 and first quarter 2014 were 4.4 percent, or about $14 billion, higher than the same time last year. "Cold weather east of the Rocky Mountains led consumers to pay more to heat their homes but less to fuel their cars," EIA said . An arctic blast brought on by a weather phenomenon known as a polar vortex pushed temperatures well below the freezing point in U.S. states east of the Mississippi River for much of the winter season. U.S. consumers spent 27 percent, or $6 billion, more on heating oil and propane than the previous winter. While those fuels typically make up […]

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Shell Considers Retiring California Coker Amid Shale Boom

Royal Dutch Shell Plc (RDSA) , Europe ’s biggest oil company, is considering retiring one of two coking units at its only refinery in as the company seeks to run lighter crude at the plant. The company has applied to county regulators for a permit to shut the flexicoker at the 156,400-barrel-a-day Martinez refinery northeast of San Francisco , a move that would shrink the plant’s reliance on heavy oils and cut its greenhouse-gas emissions by 15 percent, Destin Singleton, a Shell spokeswoman, said May 16. The unit helps convert the denser crude into more valuable products such as diesel and gasoline. Shell is considering the shutdown as hydraulic fracturing and horizontal drilling unleash record volumes of light oil from shale formations across the middle of the U.S. California’s refiners, lacking pipeline access to the growing crude supplies, are bringing in the most ever by rail as they work […]

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Canada moves to put toughter limits on dangerous oil trains

Emergency personnel examine the wreckage of a train derailment near Vandergrift, Pennsylvania, February 13, 2014. The 120-car Norfolk Southern Corp train carrying heavy Canadian crude oil derailed and spilled in western Pennsylvania.  In Lynchburg, Virginia, on April 30, a train carrying crude oil derailed , and some of the rail cars exploded into a ball of fire, and then fell into the James River. This was not an isolated incident. A number of explosive train derailments, including the tragedy in Lac-Megantic, Quebec , which killed 44 people, have raised the alarm about the safety of shipping oil by rail. The oil now gushing from the Bakken Shale in North Dakota and the Alberta Tar Sands has overwhelmed pipeline capacity, and millions of gallons now ride the rails, often in older tanker cars vulnerable to rupture. Increased alarm and public pressure have now pushed Canada to act. New rules announced […]

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Canada Said to Aim to Bolster Aboriginal Pipeline Support

The Canadian government is poised to take another step to boost support for pipelines as it prepares to rule on Enbridge Inc. (ENB) ’s proposed Northern Gateway project. Natural Resources Minister Greg Rickford plans to announce his department will set up a new branch office based in British Columbia to oversee discussions with aboriginal groups, two people briefed on the matter said yesterday. The announcement may take place as early as next week, said the people, who asked not to be identified because the information isn’t public. The branch will be part of the Major Projects Management Office based in Ottawa that was created in 2007 to support regulatory reviews of resource developments. Rickford’s announcement will address recommendations made in December by Douglas Eyford, a lawyer appointed by Harper to review aboriginal concerns about resource development. In his report, Eyford advised building on the Major Projects Management Office model […]

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Diesel Slumps in Europe as Russia, U.S. Imports Surge

European diesel will probably stay depressed this summer after plunging to the lowest for this time of year since 2003 amid surging imports from Russia and the U.S. Barges of diesel traded at $9 a metric ton more than the June gasoil contract on the ICE Futures Europe exchange on May 19. That’s the lowest premium in more than three months and a drop of 66 percent from April 15, according to data compiled by Bloomberg. Gasoil’s crack spread, a measure of profit to be made from refining the fuel, declined 18 percent since mid-April to about $12 a barrel on the ICE exchange today. “Europe looks extremely well supplied,” Steve Sawyer, an analyst at FGE, a consultant, said by phone from London yesterday. “I would expect both Russian and U.S. refiners to be pushing their rates during the summer and looking to Europe to dispose of the product.” […]

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Gazprom obligated to Ukraine, European president says

The European Union expects Russia to keep gas flowing through Ukraine so long as diplomatic channels are open, the European Commission president said Wednesday. European Commission José Manuel Barroso sent a letter Wednesday to Russian President Vladimir Putin. In it, he said it was important that all parties to a row over gas supplies through Ukraine remain engaged. "As long as the trilateral talks are on-going, gas flows should not be interrupted," the letter stated. "It therefore continues to be Gazprom’s responsibility to ensure the deliveries of the required volumes as agreed in the supply contracts with European companies." Gazprom in April sent its Ukrainian counterpart Naftogaz a bill for more than $11 billion for taking on less gas than contracted in 2013. Moscow has called on Kiev to pay in advance for natural gas in order to avoid a similar row in 2009 that […]

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EU Outlines Plans to Wean Itself Off Russian Gas

The European Union sketched out new plans to reduce its dependence on Russian natural gas and to bolster its energy security while warning Moscow not to cut off gas supplies to Ukraine. The push to forge closer energy ties among the bloc’s 28 countries and find alternative suppliers has intensified over the past weeks, as Russian threats to shut off the flow of gas to Ukraine raise the specter of supply disruptions for Europe as well. The Ukraine crisis has galvanized the EU into mapping out a new energy-security strategy for the 28-country bloc that will be discussed by EU leaders at the end of June. "The great game of geopolitics is making an unwelcome return and this is being felt particularly in the area of energy," European Commission President José Manuel Barroso told a conference on energy security in Brussels on Wednesday, in which he outlined proposals to […]

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The World’s Demand For Oil Is Slowing

According to Oil Market Intelligence (OMI), world crude oil supply rose to a record 90.2mbd on average over the past 12 months through April. The price of a barrel of Brent crude oil has been remarkably flat (with some volatility) around $110 since early 2011. World oil supply has been well balanced with world oil demand at this price. Let’s review some of the highlights of the latest demand data compiled by OMI through April using 12-month averages to smooth out seasonal volatility: (1) World . World crude oil demand rose to a record 91.7mbd last month. However, the growth rate has slowed from a recent high of 1.5% y/y during September 2013 to 1.0% during April. This suggests that the global economy is growing, but at a relatively slow pace. (2) Emerging countries . Most of the recent slowdown is attributable to emerging economies. The OMI data show […]

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The Connection Between Oil Prices, Debt Levels, and Interest Rates

If oil is “just another commodity,” then there shouldn’t be any connection between oil prices, debt levels, interest rates, and total rates of return. But there clearly is a connection. On one hand, spikes in oil prices are connected with recessions . According to economist James Hamilton, ten out of eleven post-World War II recessions have been associated with spikes in oil prices . There also is a logical reason for oil prices spikes to be associated with recession: oil is used in making and transporting food, and in commuting to work. These are necessities for most people. If these costs rise, there is a need to cut back on non-essential goods, leading to layoffs in discretionary sectors, and thus recession. On the other hand, the manipulation of interest rates and the addition of governmental debt (by spending more than is collected in tax dollars) are the primary ways […]

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Export Delusions: Why the rush to export natural gas is a fool’s errand

On a sweltering day in May last year I sat dumbfounded at a US Senate Energy & Natural Resources Committee meeting. Pat Outtrim, VP of Cheniere Energy, was arguing for fast-tracking approval of Liquified Natural Gas (LNG) exports because it would benefit energy consumers… in Great Britain . A year later and the drum beat for approving LNG export operations is reaching a crescendo. This time it’s spurred by claims that we must save Europeans from the grip of Russia, who is using its position as the primary natural gas provider in Europe to annex Crimea and assert its power in the region. In both cases, the rationale is the same: The US has an over-supply of natural gas—thanks to an explosion of hydraulic fracturing (“fracking”) for previously inaccessible shale gas—and it’s our duty as international […]

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Oil Up Ahead of Likely U.S. Stockpile Drop

Crude oil futures were up in London trading Wednesday ahead of data that may show a decrease in U.S. inventories, and as geopolitical tension remains supportive of higher prices. Brent crude for July delivery was up 33 cents at $110.02 a barrel on ICE Futures Europe. July crude was up 77 cents at $103.10 a barrel on the New York Mercantile Exchange. A reduction of inventories at Cushing, the delivery point for Nymex-traded futures, is likely to be evident in weekly inventory statistics due later in the day, said Ole Hansen at Saxo Bank. Lower inventories would lend support to U.S. futures, signaling higher demand and more draw on stockpiled oil. "Other supporting factors such as the crisis in Ukraine and renewed violence in Libya leaves the downside risk limited at the moment," Mr Hansen said. Other data releases will also be closely watched by a market searching for […]

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WTI Crude Rises to One-Month High on Supply Drop; Brent Advances

West Texas Intermediate climbed to the highest intraday level in a month after industry data showed crude inventories slid in the U.S., the world’s biggest oil consumer. Brent crude rose amid tension in Ukraine and Libya. Futures for July advanced as much as 0.9 percent in New York. Crude supplies shrank by 10.3 million barrels last week, the American Petroleum Institute reported yesterday. Stockpiles were probably unchanged near a record high , according to a Bloomberg News survey before government data today. Citigroup Inc. raised its Brent price forecasts, citing increased risk from the crisis in Ukraine and supply uncertainty in countries including Libya. The API “reported a very large drop in crude oil imports leading to a huge crude oil stock draw,” Olivier Jakob , managing director at Petromatrix GmbH in Zug, Switzerland, said by e-mail. “It will be interesting to see the import breakdown” in the government […]

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API shows surprise 10.3 million-barrel weekly draw in US crude stocks

US commercial crude stocks fell 10.3 million barrels to 390.69 million barrels for the reporting week ended May 16, American Petroleum Institute data showed Tuesday. The draw is far larger than analysts had expected. A Platts survey of analysts Monday showed stocks were expected to have fallen 300,000 barrels. NYMEX July crude rose to $102.90/b in electronic trading shortly after the data. The contract had earlier settled at $102.33/b. The draw comes amid a sharp, 468,000 b/d decline in US Gulf Coast crude imports, which fell to 3.52 million b/d last week. USGC crude runs edged higher, up 47,000 b/d to 8.28 million b/d. These factors combined to cut USGC crude stocks by 6.41 million barrels to 202.05 million barrels. Total US imports fell 860,000 b/d to 6.78 million b/d, while crude runs rose 170,000 b/d to 15.87 million b/d. The increase in runs helped to boost US refinery […]

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Diesel Futures Gain on Speculation Demand Will Climb

Diesel futures rose, reversing an earlier decline, on speculation demand will climb from a six-month high and as U.S. exports rise. Futures climbed as much as 0.6 percent in New York . Demand for distillates in the four weeks ended May 9 was 4.09 million barrels a day, the highest level since November, according to government data. That may reach 4.5 million this week as export flows are forecast to increase, according to Energy Analytics Group Ltd., a fund adviser. “Demand is already exceptionally high and exports are growing dramatically,” said Tom Finlon, director of Energy Analytics in Jupiter, Florida. “It’s very good for diesel.” Ultra low sulfur diesel for June delivery advanced 1.25 cents, or 0.4 percent, to $2.9534 a gallon at 12:59 p.m. on the New York Mercantile Exchange . The fuel’s crack spread versus West Texas Intermediate crude swelled 72 cents to $21.63 a barrel while […]

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Natural-Gas Prices Keep Climbing on Predictions for a Warm June

By Timothy Puko NEW YORK–Natural gas futures climbed to their highest close in more than a week, as June weather forecasts suggest an early start to the summer demand season. Prices for the front-month June contract rose 8.2 cents, or 1.8%, to $4.552 a million British thermal units on the New York Mercantile Exchange. Prices jumped 4.5% during the past week of trading, finishing Tuesday at their highest point since May 8. Warming weather forecasts have been the recent driver, pushing up prices for two sessions. They predict highs into the 80s in early June that could lead to air conditioners turned on around the clock. That could lead to an unseasonably high demand for electricity and the natural gas that fuels it. "Every little piece of data…is having an outsized impact on the market," said Richard Soultanian, co-president of NUS Consulting Group in Park Ridge, N.J. "There’s a […]

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Iran wags finger at foreign energy contractors

Foreign contractors working in the Iranian energy sector need to stay committed to their obligations or face expulsion, a development official said Tuesday. Abdorreza Haji Hosseinnejad, the director of Iran’s Petroleum Engineering and Development Co., said contractors need to respect the terms of their contracts with the Iranian government. "Unjustified delays, refusal to respect legal obligations in the development of fields particularly joint fields will lead to their removal," he said . Iran in early May canceled a contract with China National Petroleum Corp. for work at South Azadegan oil field, a 40-billion barrel field straddling the Iran-Iraq border. Awarded the contract in 2009, Iran says CNPC was dragging its feet on the project. Iranian Oil Minister Bijan Zanganeh had said Chinese companies were still welcome to participate in Iran’s energy sector despite issues with CNPC, though the development official said all parties working on […]

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Iraqi Premier Leads Vote, Faces Stalemate

BAGHDAD—A coalition led by Iraqi Prime Minister Nouri al-Maliki won the most seats in the country’s first parliamentary elections since U.S. troops left in 2011, setting the stage for a lengthy period of political wrangling amid the worst violence since the civil war. Mr. Maliki’s State of Law coalition won 92 out of 328 parliamentary seats in the elections held in late April, three more seats than it won in 2010, the Iraqi High Election Commission said Monday, putting the Iraqi leader in a strong position to secure a third term. The result left many Iraqis wondering whether another four years under Mr. Maliki, a Shiite Muslim, would deepen the sectarian rancor and extend a political stalemate that has left the government adrift. Western diplomats and analysts say that further instability would also add to the region’s political maelstrom; Syria’s civil war has spilled over into Iraq. To form […]

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Iraq's Maliki 'set to win elections'

Prime Minister Nouri al-Maliki’s coalition won the most seats in Iraq’s parliamentary elections but fell short of a majority, leaving him in the driver’s seat to retain his post despite vocal opposition. Monday’s results from the election commission showed Maliki’s State of Law alliance garnered 92 out of 328 parliamentary seats, with the incumbent himself winning more than 721,000 personal votes. Both were by far the highest such figures from the April 30 election. But he still fell short of a majority, meaning he will have to win the support of rivals from across the communal spectrum, some of whom have sharply criticised Maliki and refused to countenance his bid for a third term in office. State of Law won 30 seats in Baghdad alone, and came first in 10 provinces overall, all of them in the bloc’s traditional heartland in the Shia-majority south of the country. Maliki’s main […]

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Iraq’s Maliki ‘set to win elections’

Prime Minister Nouri al-Maliki’s coalition won the most seats in Iraq’s parliamentary elections but fell short of a majority, leaving him in the driver’s seat to retain his post despite vocal opposition. Monday’s results from the election commission showed Maliki’s State of Law alliance garnered 92 out of 328 parliamentary seats, with the incumbent himself winning more than 721,000 personal votes. Both were by far the highest such figures from the April 30 election. But he still fell short of a majority, meaning he will have to win the support of rivals from across the communal spectrum, some of whom have sharply criticised Maliki and refused to countenance his bid for a third term in office. State of Law won 30 seats in Baghdad alone, and came first in 10 provinces overall, all of them in the bloc’s traditional heartland in the Shia-majority south of the country. Maliki’s main […]

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Parliamentary Wins May Seal Third Term for Iraqi Premier

BAGHDAD — Beating expectations, Prime Minister Nuri Kamal al-Maliki secured the largest number of seats in last month’s parliamentary elections, the first since the withdrawal of American forces at the end of 2011, putting him in a strong position to secure a third term as Iraq’s leader as negotiations begin to form a new government. The elections were held on April 30 , during a time of heightened violence around the country, but initial results — still subject to challenges from various political parties — were not released until Monday, as extra security fanned out around the capital in advance of the announcement. Mr. Maliki and his Shiite Islamist political coalition were expected to win a plurality of votes, and they did, but the margin of victory was greater than most analysts and politicians here forecast. Even though he faces stiff opposition to a third term from Shiite rivals […]

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Baghdad-Basra railway line enters into service

Iraq’s Ministry of Transport on Monday (May 19th) announced the entry into service of a passenger and cargo railway line linking Baghdad and Basra. Construction on the high-speed rail line had finished in March. The new line links Basra’s sea ports to central Baghdad, passing through various cities en route, said Abdullah Sajet, director-general of the southern region of Iraq’s railways company. A modern, high-speed train featuring sleeping compartments and restaurants has been purchased, he said at a Monday press conference.

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Pipeline attack adds to Egyptian gas woes

Egyptian media said Tuesday militants in the Sinai Peninsula bombed a natural gas pipeline in a regional industrial zone, though no injuries were reported. Ahram Online reported unknown assailants blew up the pipeline that supplies regional industries in the city of Arish. The blast was described as powerful, though no other details were provided. Militants in the restive peninsula have targeted the region’s gas infrastructure repeatedly since the ouster of President Hosni Mubarak in 2011. The latest attack follows a push by the Egyptian government to address a lingering gas shortage. The Egyptian Ministry of Petroleum expects domestic gas production will increase 1.7 percent this year, though consumption is expected to increase by 12.5 percent. More than a dozen new natural gas wells are expected to be tied into the national grid this year in an effort to increased gas production. A country report from […]

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The Biggest Mideast Crisis You Probably Don’t Know Enough About

The Middle East’s seemingly endless conflicts are diverting attention and resources from a graver long-term threat that looms over the whole region: the growing scarcity of water. And the situation will get worse before it gets better — if it ever does get better. Years of war, careless water supply management, unchecked population growth, ill-advised agricultural policies, and subsidies that encourage consumption have turned a basically arid part of the world into a voracious consumer of water. The trajectory is not sustainable. Those were the gloomy if unsurprising conclusions of a three-day conference on the subject in Istanbul last week. From Libya to Iraq to Yemen, too many people and too many animals have stretched water resources beyond their limits. Some countries where the urgency is greatest, including Syria and Yemen, are the least equipped to stave off serious water crises. Jordan, always short of water, has been overwhelmed […]

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Top Libyan air force official backs rebel general

TRIPOLI, Libya (AP) — The top official in Libya’s air forces has announced he’ll back an offensive by a renegade general against Islamic extremists and militias blamed for wave of killings since the downfall of dictator Moammar Gadhafi. Col. Gomaa al-Abbani’s announcement late Tuesday is among a series of loyalty pledges made by military units and commanders to Gen. Khalifa Hifter. Militias allied to Hifter launched an attack Sunday against parliament after an offensive his forces led on Friday in the eastern city of Benghazi. Hours after al-Abbani’s announcement, witnesses said rockets targeted military camps in the capital, Tripoli. On Tuesday, Libya’s election commission announced parliamentary elections will be held June 25, a top demand among most Libyans.

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Libya: Election set for June in bid to ease crisis

TRIPOLI, Libya (AP) — Libya’s election commission set new parliamentary elections for next month, trying on Tuesday to find a peaceful resolution to a crisis triggered by a renegade general’s efforts to crush Islamist militias and his demand that the Islamist-led legislature disband for allegedly supporting extremism. The announcement of a nationwide June 25 vote came after the parliament met in what lawmakers had hoped would be a secret location. A missile was fired at the hotel where the session was taking place, causing panic but no injuries. The general, Khalifa Hifter, has launched an armed campaign he says is aimed at imposing stability after three years of chaos since the ouster and death of dictator Moammar Gadhafi in 2011. He says he wants to break the power of Islamists, whom he accuses opening the door to Islamic radicals. Hifter denies seeking power but indicated Tuesday that he would […]

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2 Explosions Kill Scores at Central Nigeria Market

Aftermath of Car Bombings in Nigeria People combed through the debris at the site of back-to-back explosions that killed at least 46 people in a crowded business district in the central city of Jos. ABUJA, Nigeria — Two powerful explosions killed scores of people, many of them female vendors, in the central Nigerian city of Jos on Tuesday afternoon, officials and witnesses said. While no one claimed responsibility for the bombing, it occurred as international attention has focused on the Islamist extremist group Boko Haram following the abduction of hundreds of schoolgirls last month and may have been a bloody act of defiance. The blasts shattered a bustling market area as working people were doing afternoon grocery shopping. With rescue operations still underway in a chaotic, smoky tangle of blasted stalls and body parts, the police commissioner confirmed that at least 46 were killed and 45 wounded in the […]

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Panicked Workers Fled Fukushima Plant in 2011 Despite Orders, Record Shows

At the most dire moment of the Fukushima nuclear crisis three years ago, hundreds of panicked employees abandoned the damaged plant despite being ordered to remain on hand for last-ditch efforts to regain control of its runaway reactors, according to a previously undisclosed record of the accident that was reported Tuesday by a major Japanese newspaper. The newspaper, The Asahi Shimbun, said that the episode was described by Masao Yoshida, the manager of the Fukushima Daiichi plant at the time of the accident, in a series of interviews conducted by government investigators several months after the March 2011 disaster. The newspaper said it had obtained a copy of a 400-page transcript of the interviews, which had been referred to in government accounts of the accident but had never been released in its entirety. Such a transcript could represent the only testimony of the accident left by Mr. […]

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China, Russia ink long-awaited gas deal

China and Russia on Wednesday inked the long-awaited gas deal in Shanghai, ending the decade-long natural gas supply talks between the two neighbors. The deal came one day after visiting Russian President Vladimir Putin said that "significant progress" had been made over the price in the lengthy talks. Two documents, China and Russia Purchase and Sales Contract on East Route Gas Project and a memorandum, were signed at a ceremony attended by Chinese President Xi Jinping and Russian President Vladimir Putin. Over the past years, talks, which started in 2004, have stalled over price. The gas supply deal was signed on the sidelines of the fourth Summit of the Conference on Interaction and Confidence Building Measures in Asia, a regional security summit which Putin and Xi are attending. China and Russia have vowed to strengthen cooperation in energy and infrastructure in Russia. According to […]

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China Signs Non-Dollar Settlement Deal With Russia’s Largest Bank

Slowly – but surely – the USD’s hegemony is being chipped away whether by foreign policy faux pas, crossed red-lines, or economic fragility. However, on Day 1 of Vladimir Putin’s trip to China it is clear that the two nations are as close as ever. VTB – among Russia’s largest banks – has signed a deal with Bank of China to pay each other in domestic currencies, bypassing the need for US Dollars for “investment banking, inter-bank lending, trade finance and capital-markets transactions.” Kirill Dmitriyev the head of Russia’s Direct Investment Fund notes, “together it’ll be possible to discuss investment in various projects much more efficiently and clearly,” as Russia’s pivot to Asia continues to gather steam. As RT reports , Day 1 for Putin is going well… VTB, Russia’s second biggest lender, has signed a deal with Bank of China, which includes an agreement to pay each other […]

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China to delay Russia gas deal in blow to Vladimir Putin

China will not reach an agreement to import natural gas from Russia’s during a state visit by President Vladimir Putin this week despite strenuous Russian efforts to secure what has been portrayed as a key test of closer Sino-Russian ties. As Moscow’s relations with the West have deteriorated over the crisis in Ukraine, Mr Putin has sought to show the world and the Russian people that he has alternative friends to the east. Russian media, officials and Mr Putin himself have repeatedly said the 30-year, $456bn deal would be signed during the president’s visit to Shanghai, which ends on Wednesday evening. But PetroChina , the listed subsidiary of state-owned China National Petroleum Corp, China’s largest oil company, told the Financial Times on Wednesday that the deal would not be signed on this visit. “We won’t be signing [on this visit],” said Mao Zefeng, spokesman for PetroChina. “At the moment […]

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Russia, China Vow to Reach a Gas Deal

The leaders of China and Russia pledged to deepen energy ties during the first day of a state visit by President Vladimir Putin but failed so far to reach a final agreement to pipe Russian gas to China, signaling that disagreements over price remain an obstacle to the long-stalled deal. Officials from both countries have raised expectations that a deal could finally come together during Mr. Putin’s visit this week to Shanghai, where he and China President Xi Jinping are participating in a regional security conference. The prospect of exporting Russian natural gas to energy-hungry China has been under consideration for years, but pricing has served as a major barrier. Following their meeting on Tuesday, the Chinese and Russian leaders signed a joint statement calling for Russian gas supplies to begin being exported to China as quickly as possible, according to China’s official Xinhua news agency. Mr. Putin will […]

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Russian, Chinese gas deal is 'massive,' energy minister says

A "massive" contract in the works for Chinese energy has nothing to do with challenges in the European gas sector, Russia’s energy minister said Tuesday. Russian Energy Minister Alexander Novak said the Kremlin aims to sign sweeping oil and natural gas contracts with China. In an interview the Russia-24 TV channel, he said bilateral economic initiatives with Beijing are part of a broad agenda. "That is why we sign these massive contracts to supply gas, oil, construct infrastructure pipelines — they lay the foundation not for the present day, and neither it is associated with the situation around the European partners today," he said . "This is due to the development of relations with Asia-Pacific countries in general, with such key partners as China." Russian President Vladimir Putin is putting the final touches on a contract with China that envisions natural gas deliveries and associated […]

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Russian, Chinese gas deal is ‘massive,’ energy minister says

A "massive" contract in the works for Chinese energy has nothing to do with challenges in the European gas sector, Russia’s energy minister said Tuesday. Russian Energy Minister Alexander Novak said the Kremlin aims to sign sweeping oil and natural gas contracts with China. In an interview the Russia-24 TV channel, he said bilateral economic initiatives with Beijing are part of a broad agenda. "That is why we sign these massive contracts to supply gas, oil, construct infrastructure pipelines — they lay the foundation not for the present day, and neither it is associated with the situation around the European partners today," he said . "This is due to the development of relations with Asia-Pacific countries in general, with such key partners as China." Russian President Vladimir Putin is putting the final touches on a contract with China that envisions natural gas deliveries and associated […]

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Chinese rig a serious issue, Vietnam says

The situation surrounding China’s decision to send an oil rig into waters disputed with Vietnam is growing unpredictable, a Vietnamese legislator said Tuesday. Members of the Vietnamese National Assembly met Tuesday in Hanoi to discuss National Offshore Oil Corp. to deploy rig HD-981 about 120 miles off the coast of Vietnam. National Assembly Chairman Nguyen Sinh Hung said the situation in the South China Sea was getting complicated. "China’s recent deployment of a giant oil rig and its protective armada in Vietnam’s [exclusive economic zone] seriously violates Vietnam’s territorial sovereignty," he said . A government report submitted Tuesday to the assembly says Vietnam reserves the right to maintain a posture of self-defense in the event the situation escalates. China says it’s operating within its territorial waters. The U.S. government has weighed in , saying it has no stance on claims to the South China […]

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China’s Thirst for Coal is Drying Up

As the ‘ airpocalypse ‘ news out of China continues to grow, what we predicted more than a year ago is now increasingly obvious – China’s seemingly endless coal demand is a , and the Chinese coal boom is over . What we often hear about a never-ending demand for coal in China has turned out to be just a desperate attempt by a flailing industry seeking to convince investors and politicians that they have a future in a cleaner, greener 21st century. But as frustration with deadly coal pollution grows along with China’s booming clean energy industry, this looks increasingly doubtful. Since news of the airpocalypse first broke, the Chinese public has become increasingly adamant that dangerous air pollution from coal-burning power plants be curbed. In response, China’s State Council announced a detailed plan — The Airborne Pollution Prevention and Control Action Plan — that aimed to cut […]

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House stumps for natural gas infrastructure

WASHINGTON, May 20 (UPI) –The U.S. House Energy and Commerce Committee says it’s time to build domestic natural gas infrastructure before winter energy demands increase. The committee said legislation passed in the House in late 2013 — the Natural Gas Pipeline Permitting Act — would facilitate the construction of gas pipeline infrastructure needed to keep supplies moving when demand is at its highest. "Even as we enter the hot summer months, we know winter will come again soon," a committee statement read Monday. "And the only way to bring down heating prices in the future is to build new infrastructure now." The bill would require the Federal Energy Regulatory Commission to make a decision on new pipelines within 12 months. Detractors of the measure said FERC already acts quickly and, if passed in the Senate, the bill would do little to address high heating costs across the board. Nevertheless, […]

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Bakken Shale Oil Safe for Rails, Industry Group Says

Crude oil from the Bakken Shale formation doesn’t pose special risks to rail transport and shouldn’t require a separate classification regime than other hazardous liquids, North Dakota oil producers said in a study released Tuesday. The report compiled for the North Dakota Petroleum Council, a lobbying group for energy producers in the state, found that Bakken oil is comparable in volatility to gas-rich oils from other shale formations in other regions. The North Dakota oil producers’ study follows a report with similar results issued last week by a refining industry group. Both reports come amid greater regulatory scrutiny of Bakken oil shipments by rail following several fiery accidents over the last year. "There’s nothing wrong with Bakken crude," Jeff Hume, vice chairman of Bakken producer Continental Resources , said after the study was released. The North Dakota study, which tested 150 crude samples from oil wells and railroad […]

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Chiyoda Wins $10 Billion Canada LNG Plant Order

TOKYO—Japan’s Chiyoda Corp. , in partnership with three other companies, has won a contract to design and build a $10 billion natural gas liquefaction terminal in western Canada, which is expected to supply gas to Japan and other parts of Asia. The project, in Kitimat, British Columbia, is one of a number of Canadian developments under way seeking to tap into growing demand in Asia for liquid natural gas. Japan, in particular, is expected to need large amounts of LNG as it fills a gap in its energy supplies from reduced use of nuclear power after the 2011 accident at the Fukushima Daiichi plant. But projects in British Columbia have been slowed by concerns over the potential environmental impact and questions about the costs of development. Chiyoda and another Japanese engineering concern, Corp. , have been active bidders for contracts to build LNG plants, a complex task that involves […]

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Texas RRC Oil and Gas Data

The Texas Rail Road Comission  has has released their production numbers for March. The data is always incomplete and the most recent data is always the most incomplete. Nevertheless one can glean quite a bit from the data even though it is incomplete. The May Report has data through March, April through February and the March report has data through January. You can see from this chart how Texas upgrades their data as data comes trickling in. I looks like Texas condensate has peaked. May 2013 is the peak so far. October 2013 is creeping up but I don’t think it will overtake May. Regardless of whether May will be the ultimate peak or not there is no doubt that there has been a dramatic slowdown in Texas Condensate production. Combine the two and we get what the EIA counts as C+C. C+C has not peaked but I think the […]

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Koch to expand Eagle Ford crude line

Koch Pipeline Co. LP , an indirect, wholly owned subsidiary of Koch Industries Inc., plans to install a 24-mile, 200,000-b/d pipeline in San Patricio County, Tex., effectively expanding the company’s South Texas crude oil pipeline system. Koch operates 540 miles of crude oil transportation lines in Texas. The 16-in. line is expected to begin service in the second quarter. “We are seeing additional opportunities with the Eagle Ford shale play and this new pipeline will help us move domestic crude to the US market more efficiently by using a combination of new and existing pipeline infrastructure,” said Bob O’Hair, Koch Pipeline executive vice-president.

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Russia wants relief from EU roles on gas operations

Operating Germany’s Opal gas pipeline at 100 percent would address regional transit issues for Europe and Gazprom alike, Russia’s energy minister said Tuesday. "It would be rational if the European Commission granted permission for full load of Opal, in the context of improving assurance guarantees [for the supply of gas] to European consumers," Russian Energy Minister Alexander Novak said . Russian President Vladimir Putin he was optimistic the pipeline would run at full capacity after he met in Brussels with members of the European Union. The pipeline connects to the Nord Stream system through the Baltic Sea and can carry 1.2 trillion cubic feet of natural gas per year. European regulations regarding gas monopolies mean the pipeline operates at about half that capacity. Novak said it was be a "rational" decision for the European Commission to extend a waiver for the German pipeline system. "Though […]

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British fracking plans irk advocacy group

A British energy sector move toward shale natural gas is a move in the wrong direction and the public is taking notice, a British advocacy group said. British Friends of the Earth said it was frustrated by a decision by shale gas explorer Cuadrilla Resources to consider a hydraulic fracturing campaign in Lancashire. Cuadrilla said Monday it was listening closely to the public’s reaction to the potential drilling operations in Lancashire. Chief Executive Francis Egan said the engagement with the local community has been "extensive." Friends of the Earth campaigner Helen Rimmer said in response, however, the public was concerned about the risks of the fledgling shale effort in the country. "The public is rightly concerned that fracking causes more problems than it solves," she said . Cuadrilla Resources in March said it believes there are 200 trillion cubic feet of shale natural gas in […]

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Ukraine Rejects Russian Demand to Prepay for June Gas Imports

Ukraine rejects Russia demand to prepay for June natural gas imports, Ukraine Prime Minister Arseniy Yatsenyuk said, blaming Russia for the failure of the gas talks. In his letter to the European Commission and the leaders of the European Countries, which was published on the government website Tuesday, Mr. Yatsenyuk said Ukraine hasn’t declined to pay off its debt for Russian gas, but would only be willing to do so if Russian gas monopoly OAO Gazprom (GAZP.RS) retains the old price. The prime minister said the three-party talks between Russia, Ukraine and the European Union were unsuccessful because of Moscow’s unwillingness to compromise. "As there is no readiness from the Russian side for the dispute resolution, the pre-payment issue can’t be part of our talks," Mr. Yatsenyuk said. Kiev and Moscow have been locked in an increasingly bitter gas feud since the ouster of Ukraine’s President […]

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Russia: forces near Ukraine en route to home bases

Russia’s military units in the regions near Ukraine on Wednesday began moving to railway stations and airfields en route to their home bases, the defense ministry said. Military units in the Belgorod, Bryansk and Rostov regions started marching back and are expected to arrive at their home bases before June 1, the defense ministry said in a statement carried by Russian news agencies. Yet NATO, which estimates that Russia has 40,000 troops along the border with Ukraine, repeated Wednesday it could not yet see any signs of a Russian pullout. President Vladimir Putin ordered the withdrawal Monday in what could be an attempt to ease tensions with the West over Ukraine and avoid further sanctions. Russian television on Wednesday broadcast footage of columns of tanks and howitzers towed by heavy trucks. It wasn’t immediately clear where the footage was taken. The ministry said its units will […]

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U.S. Sees No Sign of Russian Troop Pullback From Border

The U.S. said there was as yet no evidence that Russian forces in regions bordering Ukraine have started a withdrawal announced by President two days ago. “We have not seen any withdrawal activity as of 2:45 this afternoon, and we’re watching as best we can constantly,” Pentagon spokesman Rear Admiral John Kirby told reporters at a briefing yesterday. “We’ve seen them say this before, we’re going to withdraw, we’re going to move.” Kirby’s comments echo assessments by the Ukrainian government and NATO. Russian state television said yesterday soldiers in three regions had started to return to their bases following Putin’s order. After annexing Crimea in March, Russia has been accused by the government in Kiev and its U.S. and EU allies of fomenting unrest in the mostly Russian-speaking east of Ukraine. Even so, Putin’s welcoming of a dialogue between the Kiev authorities and the regions and the announcement of […]

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Peak Whiskey: supplies are running low

Bourbon lovers, you’d better stock up. A day of reckoning is quickly approaching, warns Buffalo Trace, one of the oldest distilleries in the country. A whiskey shortage may soon be upon us. While bourbon producers have seen this problem coming for more than a year, its impacts are just now beginning to hit the market and will likely only worsen. Here’s Buffalo Trace with more on the problem: Despite the increase in distillation over the past few years, bourbon demand still outpaces supply. The overall bourbon category is experiencing 5% growth, but premium brands are up nearly 20% from last year. Bourbon must be matured in new oak barrels and Buffalo Trace ages many of its barrels for eight to ten years, and some over two decades. That’s a long time to wait for a bottle of bourbon. Not to mention, with the amount of bourbon lost to evaporation over time, barrels are half empty after ten years. […]

Posted On : Published By : Tom Whipple