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Iraqi Kurdish oil may finally be freely for sale as the US seems to be dropping its threats

The United Leadership, a tanker containing about one million barrels of oil from Iraqi Kurdistan, has been stuck at sea for two months. The ship has been mostly anchored off the Moroccan coast, the victim of legal threats against potential buyers. It is mired in a battle between Kurdistan, intent on parlaying the sale of such oil into independence, and the US and Iraqi governments, which are just as determined to prevent that and keep Iraq whole. + But people with knowledge of the situation say the US has signaled that it may stop actively discouraging potential buyers. If these people are right—and the US warnings are tempered—the market could see a fresh supply of 500,000 barrels of oil a day of Iraqi Kurdish oil by the end of 2014 and double that volume a year later. + Kurdistan already operates under relative autonomy but such new oil would probably […]

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Libyan Port of Brega to Restart Crude Shipments

Libya’s Eastern port of Brega is set to restart crude exports after a tanker arrived Thursday, the port said, as the North African country ramps up exports despite escalating violence in the capital. The Overseas Fran tanker arrived in Brega to load 750,000 barrels of crude which will be delivered to the Italian port of Genoa, the oil port said on its Facebook page. Shipping tracking website Marinetraffic.com confirmed the Overseas Fran was due to arrive Thursday in Brega. The news come after an agreement between the government and striking guards over wages paved the way for the port reopening Tuesday. There hasn’t been any crude-oil tanker leaving the port since late June, according to shipping-tracking website FleetMon.com. Earlier this week, exports of oil from the Sharara field also restarted after a five-month interruption. The developments come despite escalating violence in Libya’s capital Tripoli as rival militias fighting for […]

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Pakistan courting LNG suppliers

A report Thursday from the Platts energy news service says Pakistan is on the cusp of receiving liquefied natural gas supplies from international companies. Platts reported an unnamed official in the Pakistani Ministry of Petroleum said 12 international companies have expressed interest in supplying Pakistan with as much as 40 million cubic feet of LNG per year. State-owned import company Pakistan State Oil solicited interest for LNG shipments in May. Pakistan doesn’t import LNG, but said Monday it was getting China’s help with the construction of a LNG terminal and associated pipeline infrastructure at the port city of Gwadar near the Iranian border. Islamabad estimates the pipeline could cost $1 billion, with another $2 billion need for the LNG terminal. The poor state of the nation’s energy infrastructure is leaving it short on energy supplies, the government said. Pakistan and Qatar signed a memorandum of understanding for LNG supplies […]

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China’s Plan to Limit Coal Use Could Spur Consumption for Years

Under pressure to reduce smog and greenhouse gas emissions, the Chinese government is considering a mandatory cap on coal use, the main source of carbon pollution from fossil fuels. But it would be an adjustable ceiling that would allow coal consumption to grow for years, and policy makers are at odds on how long the nation’s emissions will rise. Senior officials are debating these issues as they formulate a new five-year development plan, to be finalized by the end of next year. China emits more carbon dioxide than any other country, so what President Xi Jinping and his colleagues decide will have far-reaching consequences for efforts to contain climate change. China’s leaders have not detailed their views on coal or carbon emission limits. But there is robust support among senior policy advisers for a firm national cap on coal starting in 2016, Wang Yi , a […]

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API survey finds gap between voters, federal officials on development

A substantial gap exists between registered voters’ support for more US oil and gas development on federal lands, and what they think federal officials actually are doing about it, according to a recent survey commissioned by the American Petroleum Institute . Nielsen’s random telephone survey of 1,012 largely suburban registered voters July 11-13 found 77% support more production of US oil and gas, including 92% of Republicans, 80% of Independents, and 66% of Democrats, API said on July 23. “But only 28% said the federal government does enough to encourage domestic oil and gas development,” API Upstream Group Director Erik Milito noted. “And 68%—including majorities of Democrats, Republicans, and Independents—say they would be more likely to vote for candidates who support offshore drilling,” he told reporters. “Clearly, voters do not think energy should be a partisan issue.” The survey’s results came days after the […]

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U.S. West States Met to Discuss EPA Emission Proposals

Top air regulators from 13 states across the western U.S. met in private last week to talk about how they could work together on carbon-emissions cuts proposed by the Obama administration. California Air Resources Board chairman Mary Nichols , Nevada Environmental Protection administrator Colleen Cripps and Arizona Department of Environmental Quality director Henry Darwin attended the July 17 meeting in Denver, spokesmen for their agencies said. The closed discussion was organized by Colorado State University’s Center for the New Energy Economy, led by former Colorado Governor Bill Ritter. The U.S. Environmental Protection Agency’s proposal to cut carbon-dioxide pollutants from power plants 30 percent from 2005 levels by 2030 includes an incentive for states to develop regional carbon-trading systems. States that combine efforts can get an extra year, until 2018, to comply. “The meeting provided a forum for us to get a better understanding of how the proposal works,” said […]

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U.S. petroleum refineries running at record levels

U.S. refineries have been processing record volumes of oil recently. Refinery inputs hit a record-high 16.8 million barrels per day (bbl/d) in each of the past two weeks, exceeding the previous record from summer 2005. Refineries in the Midwest and Gulf Coast in particular pushed the total U.S. input volume upward, as these refiners’ access to lower-cost crude oil , expansions of refining capacity, and increases in both domestic demand and exports contributed to higher refinery runs. As discussed in This Week in Petroleum , refinery gross inputs in the Midwest have been higher than the five-year range since late April. Typically, Midwest drivers use more motor gasoline in the summer, and some of that has come from the Gulf Coast. However, recent and planned changes to pipeline infrastructure have altered both the type of products in the pipelines and direction of flow. These changes increase the incentive for […]

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U.S. shale helps Canada's Encana grow

Canadian energy company Encana said Thursday it had a strong second quarter on the back of an acquisition of assets in the Eagle Ford shale area. "We had a strong second quarter off of the back of a very good first quarter and we’re meeting or exceeding our targets in every area of our business," Encana President and Chief Executive Officer Doug Suttles said in a statement . The company in May spent $3.1 billion to acquire 45,500 acres in the Eagle Ford shale area in Texas. Describing it as a "bold strategic move," Encana said the 53,000 barrels of oil equivalent per day expected from Eagle Ford will almost double its current oil production capacity. In announcing its second quarter performance, Encana said the 34,200 barrels of oil produced per day on average represents a 49 percent increase year-on-year. Encana said it expects total production […]

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U.S. shale helps Canada’s Encana grow

Canadian energy company Encana said Thursday it had a strong second quarter on the back of an acquisition of assets in the Eagle Ford shale area. "We had a strong second quarter off of the back of a very good first quarter and we’re meeting or exceeding our targets in every area of our business," Encana President and Chief Executive Officer Doug Suttles said in a statement . The company in May spent $3.1 billion to acquire 45,500 acres in the Eagle Ford shale area in Texas. Describing it as a "bold strategic move," Encana said the 53,000 barrels of oil equivalent per day expected from Eagle Ford will almost double its current oil production capacity. In announcing its second quarter performance, Encana said the 34,200 barrels of oil produced per day on average represents a 49 percent increase year-on-year. Encana said it expects total production […]

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Rail rules need further review, North Dakota says

North Dakota’s governor said new proposals for oil train safety need review, while the industry itself said concerns over North Dakota’s oil are without merit. The U.S. Department of Transportation rolled out a 200-page proposal outlining ways to make crude oil transport by rail safer. Within two years, the proposal calls for the elimination of older rail cars designated DOT 111 for shipment of flammable liquid, "including most Bakken crude oil." A series of derailments, including last year’s deadly accident in Lac-Megantic, Quebec, involved trains carrying Bakken crude oil from North Dakota. There aren’t enough pipelines in service to handle the glut of oil from North Dakota, which industry officials say leaves rail as the primary transit method. North Dakota Gov. Jack Dalrymple said the new proposals address several key areas of rail safety that are in need of improvement. "Still, we need to further review the specifics of […]

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U.S. Refiners to Ship Most Fuel to Europe Since November

Traders booked the most tankers in eight months to ship diesel and heating oil to Europe from the U.S. Gulf, where refining is surging as a consequence of America’s rising crude production. Oil companies either booked or plan to charter 16 tankers to transport cargoes on the route for loading during the next two weeks, according to the survey of six people involved in the trade yesterday. That compares with nine last week and is the highest count since Nov. 6. The highest U.S. oil production in more than two decades means Gulf Coast refineries are processing close to the most fuel ever. A ban on exporting most crude means the nation’s plants can tap cheaper supplies than their European counterparts. Tankers taking those refined fuels across the Atlantic Ocean are earning the most for the time of year since at least 2012. “There has been a strong increase […]

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Statoil Profit More Than Doubles Despite Output Drop

Norway’s Statoil posted a $1.9 billion net profit in the second quarter, more than double that of a year ago. Bloomberg News OSLO—Norwegian oil major Statoil AS A said Friday its second-quarter net profit more than doubled as higher prices offset a 9% production drop on the year, adding it was limiting its gas output on low prices in Europe. Second-quarter net profit was 11.9 billion Norwegian kroner ($1.92 billion), compared with 4.3 billion kroner a year earlier and a SME Direct consensus forecast of 11.47 billion kroner. This figure differs from net profit as reported by U.S. oil companies because it includes changes in the value of inventories. "Our quarterly earnings were impacted by divestments, seasonal effects and lower gas prices," said Chief Executive Helge Lund. "We have deferred gas production to enhance value, but remain on track for delivering on our production guiding for 2014." The company […]

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German Utilities Bail Out Electric Grid at Wind’s Mercy

Germany ’s push toward renewable energy is causing so many drops and surges from wind and solar power that the government is paying more utilities than ever to help stabilize the country’s electricity grid. Twenty power companies including Germany’s biggest utilities, EON SE and RWE AG, now get fees for pledging to add or cut electricity within seconds to keep the power system stable, double the number in September, according to data from the nation’s four grid operators. Utilities that sign up to the 800 million-euro ($1.1 billion) balancing market can be paid as much as 400 times wholesale electricity prices, the data show. Germany’s drive to almost double power output from renewables by 2035 has seen one operator reporting five times as many potential disruptions as four years ago, raising the risk of blackouts in Europe ’s biggest electricity market while pushing wholesale prices to […]

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Canada Broadens Sanctions Against Russia

Canada broadened its economic sanctions against the Kremlin, in response to the downing of Malaysia Airlines Flight 17, targeting major Russian financial and energy companies as well as Moscow-backed separatists in eastern Ukraine. Canada’s move on Thursday was signaled earlier in the week and comes as European Union officials are set to announce on Friday a fresh set of wide-ranging sanctions against Russia. Member states of the EU are said to be considering restrictions on Russian access to European financial markets and exports of military-related goods to Russia. Washington also has turned up the pressure on Moscow, leveling accusations about Russia’s role in the downing of Malaysia Airlines Flight 17. The latest was made on Thursday and suggested Russian artillery are firing across the border at Ukranian military positions. Prime Minister Stephen Harper said Canada would impose economic sanctions and travel bans against eight individuals, all […]

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Gazprom looks to future in Kazakhstan

Russian natural gas company Gazprom said it was considering extending its working relationship with its counterparts in Kazakhstan through the 2030s. Deputy Gazprom Chairman Alexander Medvedev met in Astana with Kazakh Oil Minister Uzakbai Karabalin to review the Russian company’s future in the former Soviet republic. "The parties discussed further cooperation in the gas sector and, in particular, the extension of the long-term agreement till 2038 — on purchase and sale of gas produced from the Karachaganak gas and condensate field," Gazprom said in a statement Wednesday. "A focus was also placed on the prospects for the joint development of the Imashevskoye gas and condensate field." Kazakhstan is a net importer of natural gas. Much of its domestic gas is used to enhance production from its vast oil fields. It has 85 trillion cubic feet of proven natural gas reserves and Karachaganak and Imashevskoye combine to represent 53 percent […]

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EIA: Russian export revenue highest for oil

Russia receives more revenue from the export of crude oil and petroleum products than it does from natural gas, the U.S. Energy Department said. The U.S. Energy Information Administration, the statistical arm of the Energy Department, said in a daily brief exports of crude oil, petroleum products and natural gas accounted for 68 percent of all export revenues in 2013. "Russia received almost four times as much revenue from exports of crude oil and petroleum products as from natural gas," EIA’s Wednesday brief said. "Crude oil exports alone were greater in value than the value of all non-oil and natural gas exports." European leaders are working to break Russia’s control over the regional natural gas market. Most of the Russian gas bound for Europe runs through pipelines in Ukraine, where geopolitical and contractual issues create risks for the European economy. U.S. legislators have proposed liquefied natural gas exports to […]

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Russia Oil Exports by Sea to Reach 6-Year Low on Refining

Russia’s crude exports on tankers are poised to fall to the lowest in at least six years as a government push to improve and expand domestic refineries means more oil is exported as fuels like diesel. Seaborne crude shipments from the world’s biggest energy exporter via the state-run pipeline system in August will fall 9.2 percent from this month to 2.215 million barrels a day, according to loading programs obtained by Bloomberg News . That’s the lowest since Bloomberg began tracking the data in 2008. Russia’s two biggest crude terminals, Primorsk and Novorossiysk, will both export the least on record. Russian oil companies are refining more crude domestically after President Vladimir Putin pushed them to spend billions of dollars modernizing plants. Output of diesel and fuel oil are the highest since at least 2009, Energy Ministry data show. This puts pressure on European refiners who are already receiving less […]

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The Changing Face of World Oil Markets

Here’s the introduction to a new paper I just finished: This year the oil industry celebrated its 155th birthday, continuing a rich history of booms, busts and dramatic technological changes. Many old hands in the oil patch may view recent developments as a continuation of the same old story, wondering if the high prices of the last decade will prove to be another transient cycle with which technological advances will again eventually catch up. But there have been some dramatic changes over the last decade that could mark a major turning point in the history of the world’s use of this key energy source. In this article I review five of the ways in which the world of energy may have changed forever. Below I provide a summary of the paper’s five main conclusions along with a few of the figures from the paper. 1. World oil demand is […]

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World Oil Production at 3/31/2014-Where are We Headed?

The standard way to make forecasts of almost anything is to look at recent trends and assume that this trend will continue, at least for the next several years. With world oil production, the trend in oil production looks fairly benign, with the trend slightly upward (Figure 1). Figure 1. Quarterly crude and condensate oil production, based on EIA data. Figure 1. Quarterly crude and condensate oil production, based on EIA data. If we look at the situation more closely, however, we see that we are dealing with an unstable situation. The top ten crude oil producing countries have a variety of problems (Figure 2). Middle Eastern producers are particularly at risk of instability, thanks to the advances of ISIS and the large number of refugees moving from one country to another. Figure 2. Top ten crude oil and condensate producers during first quarter of 2014, based on EIA […]

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Robert Rapier: The US and Russia are Gas Giants

This is the 2nd installment in a series that examines data from the recently released  Statistical Review of World Energy 2014 . The previous post –  World Sets New Oil Production and Consumption Records  – delved into world oil production and consumption figures. Today’s post looks at the global natural gas picture. In 2013 global natural gas production advanced 1.1% to a new all-time high of 328 billion cubic feet per day (Bcfd). Except for a one-year decline in 2008-2009, global gas production has risen fairly steadily for about three decades, and production has more than doubled during that time span: Global Gas Production 1970 through 2013 The US is Still Gas King The US continues to dominate both natural gas production (and consumption). In 2013, the US set a new all-time high production record for the third straight year, with gas production rising to 66.5 Bcfd to lead all countries. […]

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WTI Crude Declines After U.S. Gasoline Supplies Rise

West Texas Intermediate declined after inventories of gasoline expanded for a third week in the U.S., the world’s largest oil consumer. Brent was steady in London. Futures decreased as much as 0.4 percent in New York after rising 0.7 percent yesterday. Gasoline stockpiles expanded by 3.38 million barrels, compared with a projected gain of 1 million, according to an Energy Information Administration report yesterday. Crude stockpiles at Cushing, Oklahoma , the biggest U.S. oil-storage hub, dropped by 1.45 million barrels to 18.8 million, the least since November 2008, the report showed. “High refinery runs in the U.S. are translating into a gasoline stock build as we are starting to look at the end of the gasoline season,” Olivier Jakob , managing director at Petromatrix GmbH in Zug, Switzerland , said by e-mail. “The declining gasoline crack is putting pressure on the flat price of crude oil,” while low crude […]

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Iraq: Attack on prisoner convoy kills 60 people

Gunmen attacked a prisoner convoy north of Baghdad on Thursday, setting off a gunbattle with troops in which scores of prisoners and eight soldiers were killed, brutally underscoring Iraq’s instability as lawmakers convened to elect a new president. U.N. chief Ban Ki-moon arrived in Baghdad earlier Thursday, urging lawmakers to "find a common ground" so they can address the crisis sparked by the rapid advance of the Islamic State extremist group and allied Sunni militants across much of northern and western Iraq last month. At a press conference with embattled Prime Minister Nouri al-Maliki, Ban said Iraq is facing an "existential threat," but one that could be overcome if it forms a "thoroughly inclusive government." "I am deeply saddened by the senseless death of so many Iraqi people," Ban said. He added that political leaders in Baghdad and the largely autonomous Kurdish region have a "clear […]

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EIA: Iran still hurt by sanctions

International sanctions still inhibit Iran’s ability to attract foreign investments to its energy sector, the U.S. Energy Information Administration said. EIA, the statistical arm of the Energy Department, updated its country profile for Iran. The report , published one day after the U.S. Treasury Department said sanctions relief for Iran will continue through November, said investors may face restrictions in Iran’s energy sector. "International sanctions continue to affect foreign investment in Iran’s energy sector, limiting the technology and expertise needed to expand the capacity at oil and natural gas fields and reverse production declines," the report said. Iran under the terms of an agreement reached with Western powers in November 2013 secured relief from some sanctions on its energy sector in exchange for a pledge to curb its nuclear research activity. Iran can export around 1 million barrels of oil per day according to the terms of the deal […]

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IRAN

According to data from the International Energy Agency (IEA), Iran’s crude oil and condensate exports averaged 1.1 million bbl/d in 2013, 1.4 million bbl/d less than the volume exported in 2011. Iran’s ability to sell oil was substantially impeded by new sanctions imposed by the United States and the EU, which went into effect in summer 2012. Iran’s exports increased in the beginning of 2014. From January to May 2014, Iran’s exports averaged 1.4 million bbl/d, 300,000 bbl/d higher than the 2013 annual average, according to the IEA. China and India accounted for nearly all of that increase. Effects of 2011-12 sanctions According to the IEA, Iranian crude oil and condensate exports declined by 1 million bbl/d in 2012 compared with the previous year. The decline is attributed to new sanctions imposed by the United States and the EU at the end of 2011 and during the summer of […]

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Egypt Seeks to Clinch LNG Deal With Algeria, But Will Pay High Price

;Egypt is set for an expensive price tag as it seeks to clinch a deal to import much-needed liquefied natural gas from Algeria, according to people familiar with talks between the two countries. Late last month gas-rich Algeria agreed in principle to supply Egypt with roughly five cargoes containing 145,000 cubic meters of LNG each before the end of the year. The deal, made during a visit by Egyptian President Abdel Fattah Al Sisi to Algiers, is intended to alleviate Egypt’s energy crisis after talks for it to import more gas from Qatar broke down last August due to political tensions. "We had initially hoped that Algeria could be willing to give us a good discount or flexible credit terms, but as we stand we are likely to pay a high price for the deal," a senior Egyptian oil official said. "Algeria wants us to pay almost $13 per […]

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Shell holds crisis talks with Niger Delta community over threat to operations

Shell has opened talks with leaders of the Nembe community in the Niger Delta to stave off potential unrest that could disrupt the company’s operations, a Shell spokesman said Thursday. The talks come after the Nembe community in Brass Local Government Area of southern Bayelsa State Wednesday issued a 30-day ultimatum to Shell to shut down its operations for failing to abide by the terms of a General Memorandum of Understanding reached between the two parties last year. "We held discussions with the board [of the Nembe city development foundation] at Yenagoa on July 22 and are continuing to jointly explore ways of resolving the issues at stake," Shell spokesman Precious Okolobo said. He said Shell is committed to the development of host communities in the Niger Delta. The Nembe community is host to Shell-operated Nembe Creek pipeline, which can carry 150,000 b/d of crude feeding directly into the […]

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Anti-piracy watchdog concerned about rising attacks on tankers in Southeast Asia

International Maritime Bureau Thursday expressed serious concern over the rise in hijackings of tankers in Southeast Asia and warned that this could be a new trend in piracy attacks in the region. IMB, an international anti-piracy watchdog, said the attacks in Southeast Asia constituted the bulk of the incidents of piracy reported globally so far this year. At least six known cases of coastal tankers being hijacked for their cargoes of diesel or gasoil have been reported in Southeast Asia since April this year, sparking fears of a new trend in attacks in the area, IMB said in a quarterly report. It pointed out that this was in contrast to earlier attacks on vessels at anchorage, that were boarded for petty theft. "The recent increase in the number of successful hijackings is a cause for concern," IMB Director Pottengal Mukundan said in the report. Though the serious attacks have […]

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China Gasoline Stockpiles Extend Record Amid Rise of Hybrid Cars

China ’s gasoline inventories rose to a record high for a third month in June as an expanding fleet of new-energy vehicles limited demand for conventional supplies in the world’s second-largest oil consumer. Gasoline stockpiles increased 2.7 percent from May, China Oil, Gas & Petrochemicals, a newsletter published by the official Xinhua News Agency, said today. Supplies expanded to an estimated 7.81 million metric tons, the highest level since January 2010, when Bloomberg started compiling the data. Kerosene inventories also climbed to a record 1.88 million tons, up about 4.3 percent from a month earlier. China will waive a 10 percent tax on purchases of new-energy autos, the local term for electric cars, plug-in hybrids and fuel-cell vehicles, starting Sept. 1 to the end of 2017, the government said on July 9. The nation’s gasoline supply was “sufficient” last month, according to OGP. Production of the motor fuel expanded […]

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U.S. proposes new rules for moving crude oil by rail

The U.S. Department of Transportation on Wednesday proposed an overhaul of safety standards for transporting crude oil and ethanol by rail, after a number of explosive accidents over the past year. The draft rules, which are subject to a 60-day public comment period, propose new tank-car braking systems, train-speed restrictions, more testing for volatile gases and liquids, and a two-year phase out of older tank cars that officials have said are prone to puncture and fire when derailments occur. The rules follow an 18-month period which saw more than a dozen derailments of trains carrying crude oil, six of which led to major fires and one of which caused the death of 47 people in the Canadian town of Lac Megantic, in Quebec province. "Today’s proposal represents our most significant progress yet in developing and enforcing new rules to ensure that all flammable liquids… are transported […]

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Puncture-Prone Rail Cars May Be Phased Out in Two Years

The Obama administration proposed phasing out older tank cars tied to a deadly derailment a year ago and lowering speed limits as part of a set of new rules intended to reduce the risks of hauling crude oil. The proposal, which follows a series of fiery accidents, also will require improved braking systems and testing of crude oil before being loaded, according to Transportation Department statement today. The rule applies to shipments of corn-based ethanol as well as oil. “Today’s proposal represents our most significant progress yet in developing and enforcing new rules to ensure that all flammable liquids, including Bakken crude and ethanol, are transported safely,” Transportation Secretary Anthony Foxx said in Washington . The regulations are designed to update standards to account for an increase in the use of trains to carry flammable liquids, particularly crude oil from places like North Dakota’s Bakken field where production is […]

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Rig company Hercules Offshore takes big 2Q hit

Rig company Hercules Offshore said Wednesday its second quarter results were hurt by declining activity in the U.S. waters of the Gulf of Mexico. Hercules reported income from continuing operations of $6.6 million for the second quarter of 2014, compared to $16.6 million for second quarter 2014. President and Chief Executive Officer John Rynd said second quarter results reflected lower drilling activity and the transfer of properties in the U.S. Gulf of Mexico. "Our latest discussions with various domestic customers suggest activity levels will rebound late this year," he said . Rynd added his company was taking proactive measures to cut down on costs. The lease rate for its fleet of rigs remains solid for its assets deployed in the Gulf of Mexico, he said, and relatively stable crude oil prices are supporting the company’s bottom line. "While our third quarter results will likely be impacted by the current […]

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Air quality a concern near North Dakota fire

North Dakota’s Health Department said it’s surveying air quality near the site of a fire at an industrial park in Williston, the heart of the state’s oil patch. Chemicals used in hydraulic fracturing caught fire at an industrial warehouse in Williston. Officials said they’re going to let the fire burn out on its own because pouring water on the blaze would create a secondary problem for nearby waterways. The North Dakota Department of Health said it’s monitoring air quality around the industrial park for any threats to public health. "The fire in the industrial park has resulted in a plume of smoke that may adversely affect air quality in the surrounding area, and may cause health concerns," it said in a statement Tuesday. North Dakota oil production is growing as a result of the advances in drilling technology for shale reserves. The state government said oil production for May, […]

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Albany Nears Oil-Hub Status as 100-Car Trains Jam Port

Albany, New York’s capital city, may join the ranks of U.S. energy hubs such as Houston and Cushing, Oklahoma , as oil-terminal operator Global Partners LP (GLP) pushes an expansion plan after already quadrupling its capacity. For the last two years, more oil from the Bakken shale formation has rolled 1,800 miles (2,900 kilometers) by rail across North Dakota and around the Great Lakes to Albany. There, companies including Global Partners and Buckeye Partners LP (BPL) load barges bound for New Jersey and New Brunswick refineries. Albany’s importance as a link in the energy-production chain is poised to grow under Global Partners’ effort to win state permission to handle oil-sands crude and biofuels for shipping over objections of neighbors and environmental groups. The convergence of Bakken crude cargoes in upstate New York adds Albany to the roster of North American cities grappling with a surge in rail-borne oil. The […]

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BHP Billiton lifted by U.S. shale oil

Australian natural resources company BHP Billiton said Wednesday onshore operations in the United States helped boost its oil production by 4 percent. BHP said total petroleum production for the fiscal year ending June 30 was up 4 percent year-on-year to 246 million barrels of oil equivalent per day. The Australian company said in a financial report operations in U.S. shale helped boost the output. "Onshore U.S. liquids production increased by 23 percent in the June 2014 quarter and we expect to carry strong momentum into the 2015 financial year as shale liquids volumes are forecast to increase by over 17 million boe in the period," the report said. The company said the bulk of its onshore investments targeted the Eagle Ford shale play in the southern part of the United States. Roughly 75 percent of the $4.2 billion in drilling expenses targeted that play. Eagle Ford output during the […]

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Alberta frets over steam-injection for oil

| License Photo While potentially safe, the provincial energy regulator in Alberta said it’s not ready to lift a ban on a controversial steam-injection method for bitumen. The Alberta Energy Regulator released results from an independent review of an assessment made by Canadian Natural Resources Ltd. of last year’s seeps at its Primrose project, near the Cold Lake Air Weapons Range in Alberta. The regulators said four so-called flow-to-surface events were reported last year, spoiling about 50 acres of land. The company’s own report said a process called cyclical steam stimulation, or CSS, may have cracked open other subsurface layers, allowing oil to leak out of control from the site. Jim Ellis , president of the Alberta regulator, said flow-to-surface events could be prevented if the right mitigation efforts are in place. "That said, the AER is not prepared to approve a return to full operations at these sites […]

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U.S. Seeks New Rules for Rail Transport of Fuel

Tanker rail cars, bearing hazardous materials placards, on an elevated railway in Aurora, Ill., last month. Daniel Acker/Bloomberg The U.S. government wants to phase out thousands of railroad tank cars that carry crude oil within two years once it adopts proposed rules to upgrade safety for trains carrying flammable liquids . Tens of thousands of these older tank cars, known as DOT-111s , will have to be replaced or retrofitted under the proposed rules, announced Wednesday. This puts the U.S. on roughly the same timetable as Canada, which announced a phase out earlier this year. The federal government’s sweeping proposals come after a string of explosive derailments involving trains filled with oil from the Bakken Shale and will change how flammable liquids are transported in North America. But they aren’t as stringent as some in the rail and energy industry feared. Crude-carrying tank cars would need to upgraded by […]

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Oil and natural gas sales accounted for 68% of Russia’s total export revenues in 2013

Source: U.S. Energy Information Administration, Russia Federal Customs Service Note: Natural gas includes liquefied natural gas (LNG) sales. Russia is a major exporter of crude oil, petroleum products, and natural gas. Sales of these fuels accounted for 68% of Russia’s total export revenues in 2013, based on data from Russia’s Federal Customs Service. Russia received almost four times as much revenue from exports of crude oil and petroleum products as from natural gas. Crude oil exports alone were greater in value than the value of all non-oil and natural gas exports. Europe, including Turkey, receives most of Russia’s exports of crude oil and products, as well as virtually all exports of natural gas. Asia (especially China) receives substantial volumes of crude oil and some liquefied natural gas (LNG) from Russia. Recently, Russia finalized a 30-year, $400 billion deal to supply China with natural gas from fields in Eastern Siberia, […]

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Chinese company considering Texas site for $4.5 bil methanol facility: release

China-based Fund Connell USA Energy and Chemical Investment Corporation is considering Texas City, Texas, as the site for a $4.5 billion methanol facility, the Galveston County Economic Alliance said. If constructed, the facility could produce up to 7.2 million mt/year of methanol and would be one of the largest methanol facilities in the world. As part of the company’s evaluation, it has secured a site at Shoal Point in Texas City. If the company decides to invest in the Shoal Point site, it would also construct a deepsea marine export terminal, the Galveston County Economic Alliance said in a statement late Tuesday. In addition, the project would include a fleet of tankers to run a continual route from the Gulf of Mexico to China. The company will make a final investment decision during the second quarter of 2015. –Colleen Barry-Goodman, [email protected] –Edited by Jason Lindquist, [email protected]

Posted On : Published By : Tom Whipple
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Texas RRC July Oil and Gas Report with May Production Numbers

The Texas Rail Road Commission has just released their Oil & Gas Production Data  through May. There are four categories of data, Crude, Condensate, Gas Well Gas and Casinghead Gas. Casinghead gas is what most folks call Associated Gas. That is gas that comes up with the oil in oil wells. On all oil charts the July Report has data through May 2014 and is in barrels per day. Also the last month, May in this case, is always exaggerated on the low side. That is the data is incomplete back to about two years. But the last month is always far more incomplete than the previous months. Texas Crude Only This data is of course incomplete but even from the incomplete data we can get an idea of the average monthly increase. I calculate that Texas Crude only is increasing at about 40,000 barrels per day per month. […]

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CERI: Costs up for oil sands production

The costs of producing bitumen and synthetic crude in the Albertan oil sands have increased over the past year, says the Canadian Energy Research Institute in an annual report that projects steady growth in output. Compared with last year’s report, estimated costs of production before blending and transportation are up 4.4% for steam-assisted gravity drainage , 1.6% for mining without upgrading, and 5.9% for integrated mining and upgrading ( OGJ Online, May 29, 2013 ). The new estimates of plant-gate supply costs: $50.89/bbl (Can.) for SAGD, $71.81/bbl for stand-alone mining, and $107.57/bbl for integrated mining. CERI estimates the cost of stand-alone upgrading at $40.82/bbl. When the price of West Texas Intermediate crude is $100/bbl, the only economic production technology when blending and transportation are included in the estimate is SAGD, CERI points out. After those adjustments, the WTI-equivalent supply costs at the Cushing, Okla., pricing […]

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EU Sets 30% Energy Savings Target Under New Proposals

BRUSSELS—European Union countries will have to strive to make energy savings of 30% by 2030, according to controversial proposals unveiled by the European Commission on Wednesday. The proposal follows weeks of fierce lobbying and counter-lobbying by governments and industry, and though it is more ambitious than expected, it was immediately derided by green groups as lacking teeth. Under the current proposal, EU governments should improve energy efficiency by 30% compared with 2007 levels. But the commission caved in to enormous pressure from Poland, Hungary and others not to make the targets legally binding for now. The Ukraine crisis has turned energy efficiency into a key policy tool as a means of improving energy security and reducing Europe’s dependence on Russian gas and oil imports . It is also a cornerstone of a broader EU plan to tackle climate change by cutting carbon dioxide emissions by 40% by 2030, compared […]

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Senate leaders want more Russian sanctions

In light of Russia’s stance on the crash of the Malaysia Airlines plane, three U.S. Senators said broader sanctions on Russia’s energy sector are warranted. U.S. Secretary of State John Kerry said there was a growing body of evidence to suggest Russia may be tied to the downing of Malaysia Airlines Flight 17 last week. The passenger jet crashed near the eastern Ukrainian border with Russia, an area of operations for pro-Russian separatists. U.S. Sens. Bob Menendez , D-N.J., chairman of the Senate Foreign Relations Committee, Dianne Feinstein , D-Calif., chairwoman of the Senate Select Committee on Intelligence and Carl Levin , D-Mich., chairman of the Senate Armed Services Committee called on President Barack Obama to take a tough stance on Russia in light of the tragedy. "We write to express our outrage over the wanton destruction of Malaysia Airlines Flight MH17, and to ask that you consider imposing […]

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British shale debate town snubs permit

A British advocacy group said Wednesday it applauded a decision from a city council at the heart of the country’s shale debate to reject a drilling permit. The West Sussex County Council said it refused an application by Celtique Energy for a three-year oil and gas exploration bid. A drilling site in Balcombe, in West Sussex county, was the target of major protests last year by activists concerned over the drilling operations of Cuadrilla Resources. Demonstrators said the campaign was a prelude to a hydraulic fracturing operation, though the process known also as fracking was not conducted at the site. Brenda Pollack, a campaigner with the British Friends of the Earth, said the latest West Sussex decision was a step in the right direction. "Nobody wants to see Sussex ruined by industrial drilling for dirty fossil fuels," she said in a statement . "If Celtique had […]

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Russian oil company surveying arctic ecosystem

Russian independent oil producer Rosneft said Wednesday it’s working to set an environmental baseline to review as it readies for work in arctic reserves. Rosneft and U.S. energy company Exxon Mobil signed a cooperation agreement in 2011 to develop three reserve areas in the Kara Sea, located within the Arctic Circle. The company said Wednesday it was studying the marine ecosystem to get a better understanding of the potential impact of offshore exploration. "The objective of the said studies is collection of data on marine fauna in Rosneft license areas with a view to building a complete and detailed picture of the baseline environment state and developing a set of environmental controls to be applied during hydrocarbons exploration and production," it said . Advocacy groups like Greenpeace have expressed concern about oil operations in the pristine arctic environment, saying the remote and extreme location may present obstacles to responding […]

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EU Confirms Approval of Germany's New Renewable Energy Law

Wind turbines in Altentreptow, Germany. Bloomberg News BRUSSELS—European Union antitrust authorities confirmed Wednesday their approval of Germany’s new renewable energy law, which aims to help the country shift away from nuclear- and fossil fuel-generated power. Earlier this month, the European Commission said it had given backing to the plans after Berlin agreed to make some amendments to the law. The new law "paves the way for more market integration of renewables," Joaquín Almunia, the European Union’s antitrust commissioner, said in a news release. "In the medium term, this should lead to lower costs for consumers. Also the progressive opening up of tenders to operators located in other member states is a very positive development for the internal energy market." The EU had concerns that some German firms producing renewable energy may have benefited unfairly from subsidies in the past. It also said a surcharge imposed on imported electricity equated […]

Posted On : Published By : Tom Whipple
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EU Confirms Approval of Germany’s New Renewable Energy Law

Wind turbines in Altentreptow, Germany. Bloomberg News BRUSSELS—European Union antitrust authorities confirmed Wednesday their approval of Germany’s new renewable energy law, which aims to help the country shift away from nuclear- and fossil fuel-generated power. Earlier this month, the European Commission said it had given backing to the plans after Berlin agreed to make some amendments to the law. The new law "paves the way for more market integration of renewables," Joaquín Almunia, the European Union’s antitrust commissioner, said in a news release. "In the medium term, this should lead to lower costs for consumers. Also the progressive opening up of tenders to operators located in other member states is a very positive development for the internal energy market." The EU had concerns that some German firms producing renewable energy may have benefited unfairly from subsidies in the past. It also said a surcharge imposed on imported electricity equated […]

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EU Official Urges Not to Place Sanctions on Imported Russian Oil and Gas

EU Commissioner for Energy, Gunther Oettinger, of Germany, at a news briefing in June. European Pressphoto Agency BRUSSELS—The European Union should target energy sanctions against Moscow on the technology needed to unlock arctic resources, but it shouldn’t restrict oil or gas imports from Russia, the bloc’s energy chief said on Wednesday. "I’ve always said that energy deliveries, such as oil, gas, coal and uranium, from Russia into European markets…shouldn’t be put on a sanctions list," Günther Oettinger told a news conference. "But the Russians see a great potential for offshore oil and gas in the Arctic, which they could unlock with technology, software and hardware…which its own industry can’t produce." EU authorities are drawing up fresh options for sanctions that the 28- nation bloc could impose on Russia if the situation in Ukraine continues to deteriorate. On Tuesday, EU foreign ministers said they could adopt trade restrictions on defense, […]

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Ukraine crisis: EU to weigh far-reaching sanctions on Russia

Russia’s President Vladimir Putin attends a meeting in his Novo-Ogaryovo residence outside Moscow, on March 27, 2014.Putin said today Russia should create its own national payment settlement system, in a bid to reduce economic dependence on the West amid the controversy over Moscow’s seizure of Crimea. AFP PHOTO / RIA-NOVOSTI / POOL/ ALEXEI NIKOLSKY (Photo credit should read ALEXEI NIKOLSKY/AFP/Getty Images) EU diplomats will weigh sweeping Russian sanctions on Thursday that include a proposal to ban all Europeans from purchasing any new debt or stock issued by Russia’s largest banks, according to a proposal seen by the Financial Times. The sanctions measure, contained in a 10-page options memo prepared by the European Commission and distributed to national capitals, also proposes barring the Russian banks from listing new issues on European exchanges, preventing them from using London or other EU stock markets to raise funds from non-Europeans. More On this […]

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Debunking Peak Oil Debunkers

Electric Currents I came across this OpEd this morning by , a former financial advisory and retired attorney, now turned author. Besides turning his ‘pen’ to fiction, he also blogs on energy issues, Peak Oil, in particular, so critics will likely call him, and me, ‘true believers.’ But our particular tribe trusts facts and verifiable numbers, not loose estimations and overly-rosy forecasts, like predicting Americas’ energy independence based on fracking and tar sands. Richard has analyzed the arguments aimed at debunking ‘Peak Oil’ and found that very little substantive data is used. Instead critics turn to the same tactics used by tobacco companies and global warming deniers. I thought his comments and observations worth sharing with EV World readers. Bill Moore Denial Tricks of the Trade On an issue fraught with the potential for so much societal disruption as peak oil presents (like its kin, climate change), and the […]

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Oil Is Getting Harder and Harder to Find

Oil expert James Hamilton has an interesting summary of the current world oil market up today, and it’s worth a read. His bottom line, however, is that $100-per-barrel oil is here to stay: The run-up of oil prices over the last decade resulted from strong growth of demand from emerging economies confronting limited physical potential to increase production from conventional sources. Certainly a change in those fundamentals could shift the equation dramatically. If China were to face a financial crisis, or if peace and stability were suddenly to break out in the Middle East and North Africa, a sharp drop in oil prices would be expected. But even if such events were to occur, the emerging economies would surely subsequently resume their growth, in which case any gains in production from Libya or Iraq would only buy a few more years. The chart on the right shows the situation […]

Posted On : Published By : Tom Whipple