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Power sector CO2 emissions sensitive to policy changes and natural gas supply

The GHG10 case assumes a $10 per metric ton fee on CO2 emissions, beginning in the year 2015. The GHG25 assumes a $25 per metric ton fee on CO2 emissions beginning in 2015. Both cases escalate the CO2 fee at a rate of 5% per year. The GHG10 case with low natural gas prices combines the assumptions of the GHG10 case with the High Oil and Gas Resource case, which results in lower gas prices and encourages greater natural gas use. In 2012, almost 40% of total energy-related CO2 emissions resulted from electricity generation. About three-fourths of those power sector emissions occurred from burning coal, the most carbon-intensive fuel. Policies […]

Posted On : Published By : Tom Whipple
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Canadian Oil Producers' Group Cuts Oil-Sands Production Forecast

A Canadian oil and gas trade group on Monday lowered its long-term outlook for oil-sands production by 400,000 barrels a day, or 7.7%, to 4.8 million barrels a day, citing higher costs and deferment of projects. The Canadian Association of Petroleum Producers also said overall oil production in Canada will likely rise from 3.5 million barrels a day in 2013 to 6.4 million barrels daily by 2030, which is 300,000 barrels below its forecast a year ago. The lowered estimate comes amid growing concern in Canadian industry and government circles that oil-sands output may be slowed by a lack of pipeline capacity and access to global markets beyond the U.S. "We really do need to see some of these [pipeline] projects get put in place over the next few years in order to enable this growth to happen," said Greg Stringham, vice president of oil sands and markets at […]

Posted On : Published By : Tom Whipple
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Canadian Oil Producers’ Group Cuts Oil-Sands Production Forecast

A Canadian oil and gas trade group on Monday lowered its long-term outlook for oil-sands production by 400,000 barrels a day, or 7.7%, to 4.8 million barrels a day, citing higher costs and deferment of projects. The Canadian Association of Petroleum Producers also said overall oil production in Canada will likely rise from 3.5 million barrels a day in 2013 to 6.4 million barrels daily by 2030, which is 300,000 barrels below its forecast a year ago. The lowered estimate comes amid growing concern in Canadian industry and government circles that oil-sands output may be slowed by a lack of pipeline capacity and access to global markets beyond the U.S. "We really do need to see some of these [pipeline] projects get put in place over the next few years in order to enable this growth to happen," said Greg Stringham, vice president of oil sands and markets at […]

Posted On : Published By : Tom Whipple
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Chesapeake Spins Off Oilfield-Services Company

Chesapeake Energy Corp. on Monday said its board has approved the spinoff of its oilfield-services operations into a separate, publicly traded company. The separation will be achieved through a distribution to Chesapeake shareholders after business closes June 30, as expected, the company said. Chesapeake said shareholders of record at the close of business on June 19 will receive one share of the new company, called Seventy Seven Energy Inc., for every 14 shares they own of Chesapeake common stock. Shareholders will receive the Seventy Seven Energy stock in a generally tax-free distribution, although cash received in lieu of fractional share interests will be considered taxable, Chesapeake said. Chesapeake said earlier this year that it may separate its oilfield-services operations, which provide drilling and pressure-pumping equipment to Chesapeake and other energy concerns. The business generated $2.2 billion in revenue last year. In May, the company said it would proceed with […]

Posted On : Published By : Tom Whipple
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American Energy to Buy Permian Assets for $2.5 Billion

American Energy Partners LP on Monday said it would acquire about 63,000 net acres of oil and gas properties in Texas’ southern Permian Basin from affiliates of Denver-based Enduring Resources LLC for $2.5 billion. The deal marks the biggest acquisition yet for Aubrey McClendon ‘s new energy company, which was created after Mr. McClendon was ousted as chief executive of Chesapeake Energy Corp . in 2013. It also pushes the company into near territory, after it made its first acquisition in Ohio’s Utica Shale last year. American Energy-Permian Basin LLC, an affiliate of American Energy Partners, will make the acquisition, and said it plans to increase its position in the Permian Basin through additional acquisitions. American Energy Partners said it has raised $10 billion in debt and equity in the last nine months. At closing, the properties are expected to have net production of about 16,000 barrels of oil […]

Posted On : Published By : Tom Whipple
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Two oil spills reported in North Dakota

Two separate weekend spills in North Dakota, a state at the heart of the U.S. oil boom, released about 1,000 barrels, the state’s health department said. The North Dakota Department of Health said all liquid oil was removed from the site of Saturday’s spill of about 300 barrels in McKenzie County. "Most of the oil was confined to the trench, and no bodies of water were affected by the spill," the state agency said in a Saturday statement . There was no public comment from Belle Fourche Pipeline Co., which operated the pipeline damaged during trenching operations. About 690 barrels of oil leaked from a pipeline in Mountrail County, east of McKenzie County. The state health agency said all of the oil was contained on site, though there was no word what caused the release. Production from the Bakken reserve area in the state makes it […]

Posted On : Published By : Tom Whipple
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BP Rejected by Supreme Court on Gulf Payments Reprieve

BP Plc (BP/) must pay potentially hundreds of millions of dollars in claims after the U.S. Supreme Court refused to halt disputed payments stemming from the 2010 Gulf of Mexico oil spill. In a one-sentence order issued today, the justices said they wouldn’t put a hold on lower court rulings that require the oil company to begin making the payments, part of a $9.2 billion accord. BP says some of the money would go to businesses whose losses were unrelated to the spill, including lawyers who lost their licenses and warehouses that burned down before the incident. The company says the process violates the Constitution and the federal rules that govern class action litigation. BP believes that failure to suspend “the payment of business economic loss claims will allow hundreds of millions of dollars to be irretrievably scattered to claimants whose losses were not plausibly caused by the Deepwater […]

Posted On : Published By : Tom Whipple
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Kremlin: Too early to comment on South Stream

It’s too early to comment on word the Bulgarian government has backed out of the planned South Stream gas pipeline, a Kremlin spokesman said Monday. Bulgarian Prime Minister Plamen Oresharski said his government’s role in the gas pipeline planned through southern European countries would have to wait for consent from a European Union wary of expanding Russia’s energy influence. Kremlin spokesman Dmitry Peskov said Monday any formal comment from Moscow would be premature. "[The issue] needs to be clarified," he said . "It is early to say anything." Russian energy company Gazprom said last month it signed the necessary contracts needed to start construction of the onshore section of the pipeline later this year. South Stream has an optimum capacity if 2.2 trillion cubic feet per year and should begin service by late 2015. European lawmakers in April passed a resolution to reconsider the pipeline. Oresharski said following meetings […]

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Russian bank chiefs take aim at US dollar

Russia, China have their sights set on undercutting dollar’s dominance as reserve currency but economists are skeptical Russian companies will make bypassing the U.S. dollar in international transactions a top priority, the heads of three Russian banks said this week, in the latest sign that Russia is turning its back on the West and moving toward Asia. Sanctions imposed by the U.S. and European Union after Russia annexed Ukraine’s Crimea peninsula in March have spurred Western banks to drastically reduce their lending activity in Russia in recent months. Concerned the Russian economy was too reliant on the U.S. dollar and therefore vulnerable to Western political opprobrium, Russian politicians have called for a “de-dollarization” of their economy, underpinning a desire for greater independence from U.S. and European financial markets. “Over the last few weeks there has been a significant interest in the market from large Russian corporations to start using […]

Posted On : Published By : Tom Whipple
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Ukraine, Russia Fail to Reach Deal in Natural-Gas Talks

Ukraine and Russia failed to reach a deal to end their long-running dispute over natural-gas prices during late-night talks Monday. The European Commission hosted the meeting in Brussels in hopes of averting a possible disruption of Russian gas supplies as early as this week and said the two sides agreed to meet again by Wednesday. The marathon talks ended without a definite breakthrough at 3 a.m. on Tuesday, the deadline which Moscow had set Kiev to pay off its gas debts. Russia said that failure to do so could result in disruptions of gas supplies to Ukraine, a move that could also hit supplies to some EU countries. The 28-country block gets more than one-third of its gas imports from Russia, almost half of which is sent via Ukraine. "All sides will now meet again either Tuesday evening or Wednesday morning," said a European Commission spokeswoman. No further details […]

Posted On : Published By : Tom Whipple