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More Kurdish Oil Seen Coming to U.S. as Disputed Tanker Leaves

More Kurdish oil will probably head to the U.S. even as a tanker carrying 1 million barrels of disputed crude returns to the Mediterranean Sea six months and $60 million less valuable after anchoring off Texas . The United Kalavryta is heading to Gibraltar, Kyriakos Maragoudakis, operations manager at Piraeus, Greece-based Marine Management Services M.C. , the ship’s operator, said by e-mail Tuesday. The tanker didn’t unload, he said. The Kurdistan Regional Government plans to send more cargoes to the U.S., the semi-autonomous region’s lawyer said in a letter to the judge hearing the dispute between the KRG and Iraq over ownership of the cargo. The U.S. Gulf Coast can process more than twice as much oil as Iraq produces, with refineries that have invested in equipment to handle a wide range of crudes, making the region an attractive destination for cargoes. For now, this test case is a […]

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Crude Oil Plunge Damping Offshore Supply Vessel, Tugboat Demand

(Bloomberg) — Japan Marine United Corp., Japan’s No. 2 shipbuilder, said demand for offshore supply and support vessels has stalled after crude oil plunged to a six-year low. The company, formed by the merger of shipbuilding units at steelmaker JFE Holdings Inc. and IHI Corp., is the sole Japanese producer of anchor-handling tugs for drilling rigs and platform supply vessels. Interest in these vessels from customers has become quiet, JMU President Shinjiro Mishima said yesterday in an interview at its Tokyo headquarters. “They have changed to a ‘wait-and-see stance.’ We started to see this trend at the end of last year and into the beginning of this year.” JMU and rivals began to see demand slow as excess global supply saw oil prices more than halve since June. Brazil’s Petroleo Brasileiro SA, the biggest deepwater producer, is reviewing its $220 billion, five-year investment plan. While the recent oil plunge […]

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Iraq Oil Surge to Fan OPEC Rivalry That Triggered Slump

(Bloomberg) — The battle for customers among OPEC members that helped trigger oil’s collapse is about to escalate. Iraqi crude production is climbing from a 35-year high as it adds growing Kurdish supplies to its exports, while southern oilfields remain unscathed by Islamic State militants. Finding buyers for the new output means offering more attractive terms than rivals in the Organization of Petroleum Exporting Countries, say Citigroup Inc., DNB ASA and Barclays Plc. Oil’s biggest slump in six years gained momentum in October as a wave of discounts by Middle Eastern producers signaled OPEC members were intent on defending market share against booming shale output from the U.S. The price of Saudi crude for Asian buyers was cut to the lowest in at least 14 years last month, a move followed by Iraq, Kuwait and Iran. “This price war is not just between Saudi Arabia and the U.S., it’s […]

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Obama wins breathing space over Iran

Barack Obama won some political breathing space at home for his diplomacy with Iran on Tuesday when the Democratic senator who has co-authored a new sanctions bill said he would hold off voting on the proposal for another two months. Bob Menendez, the leading Democrat on the Senate foreign relations committee and one of the most hawkish members of Congress on Iran issues, said in a letter to Mr Obama that any vote on Iran sanctions should be put off until the end of March. More On this story On this topic IN US Politics & Policy Republican leaders in Congress could still decide to go ahead with the proposed sanctions legislation, which is due to be discussed in committee hearings starting later this week. However, the temporary truce declared by Mr Menendez and other leading Democrats who had supported sanctions will make it almost impossible to get the […]

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Iran: Lawmakers Agree To React Harshly To More Sanctions

More than 80 Iranian lawmakers signed a motion agreeing to react harshly if the United States were to impose new sanctions on the country, Tasnim News Agency reported Jan. 27. The group’s response would include annulling the Geneva interim nuclear deal.  U.S. lawmakers are divided over their stance on Iran . Several members of Congress are pushing for more sanctions, but U.S. President Barack Obama has said he will veto any attempt to impose more sanctions while nuclear negotiations are still pending.

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What is driving Pakistan’s fuel crisis?

Pakistani motorists wait for their turn to fill their vehicles at a petrol station in Islamabad on January 22, 2015 (Photo: AAMIR QURESHI/AFP/Getty Images) The shortage of imported oil began some two weeks ago, with affected areas almost grinding to a halt. Across the country, many buses have been taken off the streets, and scuffles have broken out at gas stations where people wait in long queues for fuel. Although the situation has eased slightly, the crisis prompted Prime Minister Nawaz Sharif to pull out of last week’s World Economic Forum meeting in Davos. Pakistan has to deal with chronic power cuts, and tackling the energy issue was one of Sharif’s main campaign pledges ahead of the 2013 general election. The situation was recently exacerbated by an apparent rebel attack on a key power line which plunged around 80 percent of the South Asian country into darkness over the […]

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China plans to set 2015 growth target at ‘around 7 percent’

BEIJING (Reuters) – China plans to cut its growth target to around 7 percent in 2015, its lowest goal in 11 years, sources said, as policymakers try to manage slowing growth, job creation and pursuing reforms intended to make the economy more driven by market forces. The growth target, which is set to be announced by Premier Li Keqiang at the annual parliament session in March, was endorsed by top party leaders and policymakers at a closed-door Central Economic Conference in December, said a number of people with knowledge of the outcome of meeting who spoke to Reuters. The target, which is in line with market expectations, has not been previously reported. "This year’s economic growth target will be around 7 percent, but the 7 percent should be the bottom line," said one of the sources, an influential economist who advises the government. "The government will have to balance […]

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China: Most Cities Miss 2014 Growth Targets

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Obama Plans Offshore Oil Drilling From Virginia to Georgia

The Obama administration proposed opening to offshore drilling an area from Virginia to Georgia in a policy shift long sought by energy companies but opposed by environmentalists concerned about popular resorts such as the Outer Banks and Myrtle Beach. The proposed offshore plan for 2017-2022 marks the second time President Barack Obama has recommended unlocking areas in the U.S. Atlantic for oil drilling, and he has faced criticism from allies who say the risks of a spill along the populated coast don’t justify the payoff. The agency said Atlantic leases won’t be auctioned for at least six years and drilling wouldn’t begin for several years after that. “This plan takes a balanced approach to oil and gas development,” Interior Secretary Sally Jewell told reporters Tuesday on a conference call. “It protects areas that are just too special to develop.” Managing the U.S. oil and gas boom has become a […]

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Kemp: Factors That Will Drive US Oil Production In 2015

URL: http://www.rigzone.com/news/oil_gas/a/136944/Kemp_Factors_That_Will_Drive_US_Oil_Production_In_2015 Rig counts are a highly imperfect guide to future oil production but they are one of the few readily available statistics on oilfield activity so it is unwise to dismiss their importance entirely. John Kemp is a Reuters market analyst. The views expressed are his own LONDON, Jan 27 (Reuters) – Rig counts are a highly imperfect guide to future oil production but they are one of the few readily available statistics on oilfield activity so it is unwise to dismiss their importance entirely. The sharp drop in crude oil prices since June 2014 and associated fall in rig counts published by state regulators and service companies such as Baker Hughes has sparked a lively debate about the short-term outlook for U.S. oil production. Some analysts have forecast the drop in rig counts will cause production to peak in the first six months of 2015 then begin […]

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Peak Oil Pulled a Fast One on Me

Peak Oil Pulled a Fast One on Me thumbnail I’ll admit that I was completely caught off guard by the recent (and ongoing?) crash in oil prices. It’d be a stretch to say I’m embarrassed by my lack of foresight, although perhaps “dumb-ass” would be a bit deserving. I would say I’m well enough versed with the reality of peak oil : I’ve read perhaps a couple dozen books on the topic, poured through several of the peak oil blogs (upon deciding to end my 5-year Internet hiatus a year ago), have seen several talks given by authors and writers on the topic, and I’ve attended two Age of Limits conferences. Nevertheless, even though there were bloggers out there discussing the possible ramifications of low oil prices, its possibility still didn’t register with me. I’ll explain what I mean by that shortly, but to do that it’d be best […]

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Rocky patch, or a long-term crisis for the oil field?

Some small and midsize operators have sharply curtailed their drilling plans for the Eagle Ford. So far, few of the big players in the field have announced their diminished spending plans for the year. But BHP Billiton Petroleum, one of the biggest producers in the field, said last week it will cut 40 percent of its U.S. shale drilling activity this year in reaction to lower oil prices. Photo: Express-News File Photo As the energy industry grinds through its latest chapter of low oil prices, many industry experts see nothing more than a rocky plot twist. Others see the last chapter for some shale operations, especially those that are carrying heavy debt. The price for a barrel of West Texas Intermediate was around $45 on Friday. Last June, it had soared higher than $100 per barrel. Art Berman, a Houston petroleum geologist and longtime skeptic of the shale boom, […]

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Britain’s Guardian: Shale gas ‘questionable’

British newspaper The Guardian questions government’s pursuit of shale natural gas. UPI/Kevin Dietsch LONDON, Jan. 27 (UPI) — An editorial published Tuesday by The Guardian newspaper questioned the British government’s pursuit of shale natural gas, saying leave it alone. "It is, to say the least, questionable for the U.K. to claim the need to bring on stream a new fossil fuel at a time when it is also notionally committed to greening its economy," the newspaper opined . "Fracking will never produce American amounts of shale gas, and certainly won’t even be viable for at least a decade." The British Geological Survey estimates the Bowland shale formation in the north of the country contains 1.3 quadrillion cubic feet of natural gas. The government said it must act carefully in unlocking those reserves, but expressed support for a fledgling sector it says will provide jobs, economic growth and a source […]

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Heavy Fighting Drains Ukraine Government’s Options and Finances

President Petro Poroshenko attends Auschwitz ceremonies Tuesday. ENLARGE Photo: Getty Images Ukrainian troops beat back fresh attacks by pro-Russia militants on a crucial rail hub Tuesday, part of recent heavy fighting that is sapping the Ukrainian administration of options and finances as it works to fend off a wider Russian-supported onslaught. U.S. and European leaders threatened new sanctions in the wake of a rebel rocket attack that killed dozens of Ukrainian civilians over the weekend, but Russian President Vladimir Putin appeared ready to shrug off any new measures. On Tuesday, he continued to blame Kiev for the fighting and for “gunning down civilians in cold blood.” The Kremlin denies giving support to pro-Russia rebels in eastern Ukraine or sending Russian troops, which Kiev said on Tuesday numbered as many as 15,000. Kiev and Western officials say a fresh infusion of Russian armor in the past two weeks has been […]

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Russian govt proposes spending cuts in view of crisis

MOSCOW (AP) — The Russian government, facing its worst economic crisis in a decade, on Wednesday proposed cutting planned spending by 10 percent this year and 5 percent over the next two years in all categories except military and social expenditures. Russia’s economy has been battered by lower energy prices, a collapse in the value of the ruble and Western sanctions over its involvement in Ukraine. Russia’s GDP is expected to decline by 4-5 percent this year, the first drop since 2009. The ruble has lost half of its value while the Standard & Poor’s ratings agency downgraded Russia’s credit rating to a non-investment – "junk" – level for the first time in more than a decade. The anti-crisis plan released on the government’s website on Wednesday lists measures that authorities will take to support the economy including over $3.7 billion to prop up Russian banks and $700 million […]

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Russia: Plan Approved To Cut State Spending

Moscow has approved an anti-crisis plan that would introduce structural reforms and reduce budget spending, Russian Finance Minister Anton Siluanov said, PRIME news reported Jan. 27. Siluanov said the one-year plan does not involve budget spending growth. Russia’s declining economy faces pressure from international sanctions and stands to lose from government budget cuts .

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Oil Futures Trade in Narrow Range During Asian Hours

By Eric Yep Crude-oil futures were mostly stable in Asian trade Tuesday, after posting losses in the previous trading session. On the New York Mercantile Exchange, light, sweet crude futures for delivery in March traded at $45.27 a barrel at 0435 GMT, up $0.12 in the Globex electronic session. Brent crude for March delivery rose $0.16 to $48.32 a barrel on London’s ICE Futures exchange. Oil markets appear to be consolidating with prices moving in a narrow price range for most of January, but analysts said prices are still at risk of falling further as the global oil surplus is expected to continue to rise in the first half of this year. China, the world’s second-largest oil consumer, has lowered its target for industrial-output growth to around 8% this year from 9.5% in 2014, as a slowing economy makes it difficult to boost industrial activity, a ministry spokesman said […]

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Oil Trades Near 6-Year Low as OPEC Fails to Turn Focus From Glut

Oil traded near the lowest in almost six years in New York as OPEC’s warning that prices may surge without new investment in production failed to shift the market’s focus from more immediate signs of a global supply glut. Futures fell 0.2 percent in New York, paring an earlier gain of as much as 1.3 percent. A spike to $200 a barrel is possible without adequate spending for the long term, OPEC Secretary-General Abdalla El-Badri said. U.S. crude inventories probably rose to 402.1 million barrels last week, the most in records dating back to August 1982, a Bloomberg News survey shows before a government report on Wednesday. Oil slumped almost 50 percent last year as the U.S. pumped crude at the fastest rate in more than three decades and the Organization of Petroleum Exporting Countries resisted calls to reduce output. Prices may drop to as low as $30 a […]

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Oil falls more than 1 percent as euro tumbles after Greek election

SINGAPORE (Reuters) – Oil slid more than 1 percent on Monday, with U.S. crude falling close to a six-year low, after Greek election results heightened uncertainty in the euro zone and depressed the bloc’s currency against the dollar. Greece’s left-wing Syriza appeared on course to trounce the ruling conservatives in Sunday’s snap election, setting up a possible confrontation with international creditors. March Brent crude fell 71 cents to $48.08 a barrel by 0718 GMT, wiping out light gains made on Friday after the death of Saudi King Abdullah, but it was off an early low of $47.85. West Texas Intermediate (WTI) crude for March delivery was trading down 69 cents at $44.90 a barrel. Front-month WTI earlier slid to an intraday low of $44.35, just above the $44.20 hit on Jan. 13, which was the lowest since April 2009. Global financial markets reacted to the Greek election on Monday […]

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Oil Falls to Lowest in Almost Six Years on Global Glut

Crude oil fell to the lowest in almost six years after OPEC Secretary-General Abdalla El-Badri said that there was about 1.5 million barrels a day of excess supply. Oil slipped 1 percent in New York, reversing an intraday gain of 1.8 percent that followed comments by El-Badri that OPEC is open to talks with outside producers and insufficient investment could push crude prices to $200. A blizzard that may dump 2 feet of snow from New York to Boston bolstered diesel, often traded as a proxy for heating oil. “El-Badri acknowledged that there’s about a 1.5 million-barrels-a-day surplus,” Tim Evans, an energy analyst at Citi Futures Perspective in New York, said by phone. “It’s up to the market to decide whether that’s the critical factor or the possibility of OPEC-non-OPEC cooperation or the speculation that there could be $200 oil at some future date. It looks like the market […]

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Worldwide Drilling Productivity Report

The EIA publishes what they call a Drilling Productivity Report  in which they claim that each rig is getting more productive, that is each rig produces just a little more oil each month than it did the previous month. But over the long haul, I find that the exact opposite is true. In every place in the world, each rig produces a little less oil every year. Baker Hughes publishes monthly their International Rig Count  where we can find the world rig count back to 1975. However I only looked at the last 15 years and found some surprising results. The last “Rig Count” data point on all charts below is December 2014. Also, very important, the rig count includes rigs drilling for gas as well as oil since Baker Hughes does not break down international rigs down to either gas or oil. They just give us the total […]

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The Investment Gap

With the price of oil continuing to fall, there’s an enormous question mark hanging over the U.S. oil industry: What prices are required to break-even? There’s no simple answer, since each area—such as the Bakken play in North Dakota—has a wide range of wells, from amazing to horrible, with a corresponding range of breakeven prices. Some areas of each play are clearly better than others. “We’re already seeing an enormous amount of retraction into the safe zone ,” said Lynn Helms, North Dakota’s top oil regulator. (For a map showing this retraction—which started even before the oil price crash in the second half of 2014—see my recent Wired article “ Mapping a Fracking Boom in North Dakota .”) Until just a few months ago, there were still optimistic forecasts for the future of the Bakken. For example, a report by the investment bank Citi, “ Out of America : […]

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Libya Producing 363,000 Barrels per Day

Oil output from Libya, where ports and oilfields have been shut due to fighting, has fallen to 363,000 barrels a day with exports at about 200,000, the oil minister appointed by forces in control of the capital Tripoli told Reuters. Two governments allied to armed factions are vying for control of Libya four years after the toppling of leader Muammar Gaddafi. The United Nations and Western powers do not recognise the administration which controls ministries in Tripoli. Its oil minister, Mashallah Zwai, told Reuters in an interview that Libya is producing 362,780 bpd of oil, showing a report from the National Oil Corp. That is down by half from November, when OPEC member Libya was producing around 750,000 barrels a day, and well below the 1.6 million which the North African country produced in 2010. Zwai said oil revenues would fall to between $10 billion and $12 billion this […]

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Saudi Succession Hints at Shift in Foreign Role

RIYADH, Saudi Arabia — Prince Mohammed bin Nayef, the interior minister of Saudi Arabia , arrived at a meeting of security chiefs from across the Arab world in Marrakesh, Morocco, last March to deliver a call to arms: It was time, he declared, for a concerted effort to eradicate the Muslim Brotherhood, according to two Arab officials briefed on the meeting. Several were stunned at his audacity. Brotherhood-style Islamists are an accepted part of politics in much of the Arab world, including Tunisia, Libya, Jordan, Kuwait, Bahrain and Morocco itself, to say nothing of their warm welcome in Qatar, said the officials, who spoke on the condition of anonymity so as not to anger the powerful Saudi prince. But this toughness toward perceived enemies to his family’s dynasty is characteristic of Mr. Bin Nayef, a central player in the often opaque leadership of the kingdom who was named last […]

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New Saudi king ascends to the throne as terrorism threat grows

New Saudi King Salman is taking the throne amid an unprecedented period of instability and terrorist threats. (Reuters) ARAR, Saudi Arabia — At 3 a.m. on a cold desert night earlier this month, four Islamic State militants carrying guns, grenades and cash slipped into Saudi Arabia here through a hole in the new heavy fencing that separates this country from Iraq. They were immediately spotted by Saudi border guards in a state-of-the-art control room 35 miles away, appearing first as blips on radar, then as ghostly white figures on night-vision cameras scanning the desolate desert landscape. Heavily armed troops were dispatched to confront them. When the battle ended, the four intruders — all Saudi citizens — and three Saudi soldiers were dead, including the local base commander, who was killed when a militant pretending to surrender detonated a suicide vest. “Thanks to God and our new systems, we are ready […]

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Aramco Says Saudis Won’t ‘Singlehandedly’ Balance Crude Market

Saudi Arabia won’t balance global crude markets on its own even as prices fall to levels that are “too low for everybody” and threaten investment needed to meet long-term demand, the head of Saudi Arabian Oil Co. said. Saudi Arabia, the world’s biggest oil exporter, has the most spare capacity in OPEC and has historically played the role of swing producer, cutting its output to raise prices and pumping more to lower them. Oil prices have dropped 55 percent in the past year as rising production from the U.S. and Russia helped global output exceed demand. “Supply and demand and the rules of economics will govern. It will take time for the current glut to be removed,” Chief Executive Officer Khalid Al-Falih said at a conference in Riyadh. “Saudi Arabia will not singlehandedly balance the market in a downturn,” he said, reiterating government policy. The Organization of Petroleum Exporting […]

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Oil-rich Saudis find new help in struggle to delay action on climate change: Cheap gas

A flame from a Saudi Aramco oil installation known as “Pump 3” burns in the desert near the oil-rich area of Khouris not far from the capital, Riyadh. (Marwan Naamani/AFP/Getty Images) As the ruler of a country that sits atop 300 billion barrels of oil, Saudi Arabia’s King Abdullah was no fan of proposals to limit the burning of fossil fuels. During most of his reign, the king’s chief envoy to climate talks was a ­global-warming skeptic who boasted of his success at scuttling climate treaties . But it was in the monarch’s final months that Saudi officials hit upon a more effective way to knock the clean-energy movement off its tracks: cheap gas. Since Abdullah’s death last week, Saudi officials have recommitted themselves to recent policies that have helped drive oil prices to their lowest levels in a decade. The kingdom’s efforts to manipulate oil markets are wreaking havoc […]

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Generation of Long-Lasting Mideast Rulers Produced Stability—and a Mess

ENLARGE With the death of Saudi Arabia’s King Abdullah, the downside of the Middle East’s recent legacy of autocratic rule is coming to the fore. Here, President Obama and Saudi Arabia’s King Abdullah in 2010. Photo: Roger L. Wollenberg/Press Pool The death last week of Saudi Arabia’s King Abdullah means the Middle East is nearing the end of an extraordinary era of leadership, which goes a long way toward explaining why the region is in such turmoil and so plagued by extremism flaring to the surface. King Abdullah—whose memory President Barack Obama honors with a visit to the kingdom Tuesday—sat atop the Saudi government for a decade and effectively ruled for a decade before that, after his predecessor suffered a debilitating stroke. For 20 years, then, he was a reliable U.S. ally who used a combination of skillful maneuvering and an iron fist to keep his country calm and […]

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Thousands march in Venezuela over economic crisis, shortages

0 Like Share 0 CARACAS  – Demonstrators against Venezuela’s economic crisis — facing sky-high inflation and shortages of food and consumer goods — took to the streets in their thousands Saturday, banging pots and demanding an end to President Nicolas Maduro’s term. Opposition leaders, fed up with shortages of milk, coffee, sugar, meat, toilet paper, diapers, deodorant and corn meal, and with Maduro’s refusal to overhaul the increasingly state-managed economy, say the elected socialist should go. Ex-lawmaker Maria Corina Machado — who was jailed after deadly riots last year for inciting violence — said Maduro “must step aside now, so the Venezuelan people can stand united again. ” “The government needs to be changed urgently,” Machado argued, at what opposition activists called the “March of Empty Pots. ” She insisted that constitutional order — waiting for Maduro to be voted out — “cannot wait,” even as some marchers chanted, […]

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U.S., India embrace over renewables

Prime Minister Shri Narendra Modi and US President Barack Obama face the media at Hyderbad House in New Delhi on January 25, 2015. President Obama is on a three day visit and will be the guest of honor at at India’s Republic Day celebrations. UPI NEW DELHI, Jan. 26 (UPI) — Advancing a renewable energy sector in India is a shared priority for the New Delhi and U.S. governments, the Indian prime minister said. Indian Prime Minister Narendra Modi hosted President Barack Obama in New Delhi to discuss economic, energy and nuclear developments. Obama’s visit comes two weeks after U.S. Secretary of State John Kerry welcomed the signing of billions of dollars worth of clean energy investments in the Indian economy at a New Deli investment conference. "For President Obama and me, clean and renewable energy is a personal and national priority," the prime minister said in a statement […]

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Obama Ends Visit With Challenge to India on Climate Change

NEW DELHI — President Obama pressed India on Tuesday to do more to curb the pollution that is choking its capital and contributing to global climate change , as he wrapped up a visit that yielded no meaningful breakthrough on the issue. While India and the United States agreed to cooperate in promoting cleaner energy, Mr. Obama left after three days without the sort of specific commitment to curbing greenhouse gases that he won in China last year . Instead, he used a farewell speech before his departure to argue that India had an obligation to step up, despite its economic challenges. “I know the argument made by some — that it’s unfair for countries like the United States to ask developing nations and emerging economies like India to reduce your dependence on the same fossil fuels that helped power our growth for more than a century,” Mr. Obama […]

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China’s Louisiana Purchase: Who’s building a methanol plant on the bayou?

This article is part one of a three-part series on China’s role in redeveloping southern Louisiana called China’s Louisiana Purchase. ST. JAMES PARISH, La. — A prominent Chinese tycoon and politician — whose natural gas company has a dubious environmental and labor rights record that recently started coming under fire in the Chinese press — is parking assets in a multibillion dollar methanol plant in a Louisiana town. And he appears to be doing it with help from the administration of likely GOP 2016 presidential ticket contender Louisiana Gov. Bobby Jindal. Not many locals in a predominantly black neighborhood of St. James Parish — halfway between New Orleans and Baton Rouge — know that Wang Jinshu, the Communist Party Secretary for the northeastern Chinese village of Yuhuang and a former delegate to the National People’s Congress, is the man at the helm of a $1.85 billion methanol plant to […]

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Asian Aviation Sector to Benefit From Fuel-Price Plunge

The slump in oil prices is giving many Asian carriers a strong boost in profitability. ENLARGE Photo: Reuters Many Asian airlines are seeing a particularly strong boost in profitability due to the slump in oil prices since the middle of last year, because they are typically more exposed to fuel-price swings compared with their counterparts world-wide. Jet fuel typically accounts for as much as 50% of Asian carriers’ operating costs, higher than the global average of 30%, so the improved outlook for the global industry is more pronounced in Asia than in Europe, though U.S. carriers are expected to lead the world in profits this year. International jet fuel prices have fallen 47% to US$65.80 per barrel as of January 9, according to industry trade group International Air Transport Association, or IATA. “Asian carriers tend to hedge less than their U.S. and European peers, with an average of less […]

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200 million people moved to cities in East Asia in decade

Almost 200 million people in East Asia moved to urban areas in the decade to 2010, the World Bank said Monday, creating a massive challenge to the region’s planners. About 36 percent of people in the region — which under the World Bank’s definition includes Northeast and Southeast Asia — were living in urban areas as of 2010, up from 29 percent ten years before. This suggests the region will see decades more of further population shifts, it said in a report released Monday. The report contains data gathered through satellite imagery and “geospatial” mapping which the bank said should help planners ensure that policies will benefit a larger number of those moving to cities, especially the poor. “For the first time, the data compares urban areas and their population in a consistent manner across East Asia, providing governments and local leaders with a better understanding of the shape […]

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Tight Oil Production Will Fade Quickly: The Truth About Rig Counts

U.S tight oil production from shale plays will fall more quickly than most assume.  Why?  High decline rates from shale reservoirs is given. The more interesting reasons are the compounding effects of pad drilling on rig count and poorer average well performance with time.   Rig productivity has increased but average well productivity has decreased. Every rig used in pad drilling has approximately three times the impact on the daily production rate as a rig did before pad drilling.  At the same time, average well productivity has decreased by about one-third.  This means that production rates will fall at a much higher rate today than during previous periods of falling rig counts. Most shale wells today are drilled from pads.  One rig drills many wells from the same surface location, as shown in the diagram below. (click image to enlarge) The Eagle Ford Shale play in South Texas is one of the […]

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Early signs of the Bakken oil slow-down

In mid-January, when the North Dakota Department of Mineral Resources released its latest update on the Bakken oil boom—the “Director’s Cut,” a summary compiled by the Department’s Director, petroleum engineer Lynn Helms—I was surprised by the data. But I wasn’t the only one surprised. In presenting the latest data, through November 2014, Helms explained that the state had reached “record oil production—but just barely record oil production, not really a significant increase.” Looking at the history, oil production has been pretty much the same in September, October, and November. It looks like oil production is flatlining in North Dakota—and hence, in the Bakken shale. The bigger surprise came with the data on the pace of activity in North Dakota. The Director’s Cut gives statistics that show how fast the oil boom is going, including how many drilling permits the state issued and how many drilling rigs were active. One […]

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Obama Moves to Put Much of Refuge Off Limits to Drilling

President Barack Obama ’s call to restrict oil exploration on 12 million acres of the Arctic National Wildlife Refuge probably won’t have much practical impact for an area already off-limits to drillers, though it’s created a new fault line with the Republican-led Congress. The White House on Sunday said it would ask Congress to designate “core areas” of the 19.8 million-acre refuge as wilderness, including its 1.5 million-acre coastal plain that geologists believe lies atop a rich oil reserve. “Designating vast areas in the Arctic National Wildlife Refuge as wilderness reflects the significance this landscape holds for America and its wildlife,” Interior Secretary Sally Jewell said in the statement. The practical impact is slight because Republicans, who now control both chambers of Congress, voiced immediate opposition. And oil and gas production is already prohibited in the Arctic refuge. It does add to the list of energy issues that the […]

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Diesel Rally Fizzles in New York on Barge Deliveries

A rally in diesel futures in New York on Monday proved short-lived on speculation that barge deliveries will bolster supplies by more than enough to help the Northeast weather a blizzard dumping snow on New York City. Ultra-low sulfur diesel settled 0.69 cent a gallon lower today on the New York Mercantile Exchange after rising by as much as 3.9 cents. Stockpiles of the fuel in the region are the highest for this time of year since 2012, and additional barrels arrived by barge over the weekend, said John Maniscalco, chief executive officer of New York Oil Heating Association Inc. “When you see something like this coming, you gear up quickly and early,” Maniscalco said by telephone from New York. “Terminals here are well-stocked. We’re just battening down the hatches and getting ready to take whatever’s thrown at us at this point.” New York may see as much as […]

Posted On : Published By : Tom Whipple
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Murkowski: Obama’s Alaska move an act of war

Sen. Lisa Murkowski, R-Alaska, says proposal to set aside more state acreage as a wilderness reserve is an act of war on a state that depends on oil revenue. Photo by Kevin Dietsch/UPI WASHINGTON, Jan. 26 (UPI) — The Obama administration has declared war on the economic future of Alaska by proposing new acreage as protected wilderness, congressional leaders said. The White House announced plans Sunday to set as 12 million of the 19 million acres in the Arctic National Wildlife Refuge in Alaska as protected wilderness . U.S. Sen. Lisa Murkowski , R-Alaska, chairwoman of the Senate Energy Committee, said in a statement President Barack Obama launched an assault on the health of the state’s economy with the policy recommendation. "It’s clear this administration does not care about us, and sees us as nothing but a territory," she said in a statement. "We will fight back with every […]

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North Dakota rig activity slowing

Data from North Dakota show the number of rigs in service off from their 2012 peak. (UPI/Shutterstock/Lilac Mountain) BISMARCK, N.D., Jan. 26 (UPI) — Data released Monday by the North Dakota government show the number of drilling rigs in active service down nearly 25 percent from the 2012 peak. Government data show 156 active rigs operations in the state as of Monday, a 16 percent decline from this date in 2014 and 22 percent lower than the historic peak recorded Jan. 26, 2012. Most of the rig activity was recorded in Williston County, host to the Bakken and Three Forks shale oil formations. The low price for crude oil is forcing energy companies to cut back on spending. Oil services company Baker Hughes last week said the number of rigs actively engaged in exploration or production was down 43 week-on-week, a sign the industry in general is starting to […]

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Montana oil spill no threat to North Dakota

Responders work to clear oil spilled in mid January into Yellowstone River. (Photo: Poplar pipeline unified command) WILLISTON, N.D., Jan. 26 (UPI) — North Dakota health officials said drinking water is safe to use following an oil spill in the Montana waters of the Yellowstone River. The North Dakota Department of Health and the city of Williston in a joint statement said they were still monitoring water levels, though the most recent test data show pollution levels are well below the threat level. "The tests revealed low levels of hydrocarbon contaminants within the system, but the level of contaminants is decreasing over time, which suggests that the contaminants are now leaving the system," Saturday’s statement read. The Poplar pipeline, operated by Bridger Pipeline, spilled oil into the Yellowstone River in mid January. A unified command responding to the spill said oil recovery continues, with the estimated spill volume reduced […]

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Bakken Play Rig Count Declines by 11

Williston Basin Rig Map in 2013 The Bakken-Three Forks rig count decreased by eleven  to 152 rigs running across our coverage area by the end of last week. In their weekly rig update, Baker Hughes reported that the Bakken’s decline is part of the overall plunge in U.S. oil and gas rig counts that are down by 49 to 1633. Declines were seen in all rig types: DIRECTIONAL 6 (-6) HORIZONTAL 144 (-8) VERTICAL 1 (-2) Most alarming to our readers is that Williston saw the biggest drop in the entire country and is showing the lowest numbers in four years. James Williams Williams, president of energy consulting company WTRG Economics commented to Bloomberg that,  “The Bakken was late to join the others leaving the party. It’s a high-cost producer with some of the lowest oil prices in the country.” COUNTY LAST WEEK THIS WEEK LA SALLE 34 33 […]

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Lower 48 oil production outlook stable despite expected near-term reduction in rig count

Source: U.S. Energy Information Administration, January Short-Term Energy Outlook Note: Graph does not include production from Alaska and the Federal Gulf of Mexico. The sharp decline in oil prices over the last quarter of 2014, which has continued in January, is already having a significant effect on drilling activity in the United States, as shown by the 16% decline in the number of active onshore drilling rigs in the Lower 48 states between the weeks ending on October 31, 2014 and January 23, 2015, according to data from Baker-Hughes. Moving from what has happened to forecasting the future is challenging, in part because market expectations of uncertainty in the price outlook have increased as reflected in the current values of futures and options contracts. When the latest edition of EIA’s monthly Short-Term Energy Outlook (STEO) was issued on January 13, the 95% confidence interval for market expectations for prices […]

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Kemp: North Dakota Oil Rigs Drop Points To US Output Decline After May

URL: http://www.rigzone.com/news/oil_gas/a/136928/Kemp_North_Dakota_Oil_Rigs_Drop_Points_To_US_Output_Decline_After_May The decline in oil drilling in the US should ensure that US production peaks by April or May. John Kemp is a Reuters market analyst. The views expressed are his own LONDON, Jan 26 (Reuters) – The decline in oil drilling that has occurred so far across the United States is probably enough to ensure U.S. production peaks by April or May, though that might not be evident until June or July given delays in publishing production records. If the number of active rigs continues to decline in the next few weeks, which seems likely, it is reasonably likely U.S. oil production will be falling by June or July 2015. In North Dakota, the number of rigs drilling for oil has fallen by almost a quarter in less than four months, according to oil field services company Baker Hughes. Baker Hughes puts the number of active drilling […]

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US Supreme Court Rejects BP Executive’s Appeal

URL: http://www.rigzone.com/news/oil_gas/a/136929/US_Supreme_Court_Rejects_BP_Executives_Appeal WASHINGTON, Jan 26 (Reuters) – The U.S. Supreme Court on Monday declined to hear an appeal by a former BP Plc executive who contested whether he can be charged with obstruction of Congress for downplaying the severity of the 2010 Gulf of Mexico oil spill. Prosecutors say David Rainey misled members of Congress over the amount of oil spilled in the April 2010 Deepwater Horizon incident. Rainey’s legal argument on appeal was that the government missed the deadline to file an appeal after a district court judge dismissed his obstruction charge. He was also charged with making false statements to law enforcement agents, which was not at issue in his Supreme Court appeal. He has pleaded not guilty. In June 2014, the 5th U.S. Circuit Court of Appeals in New Orleans said a lower court judge misinterpreted the obstruction statute in dismissing the charge against Rainey, a […]

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U.S. oil well shut-ins start as crude rout batters small producers

HOUSTON (Reuters) – Collapsing crude prices are confronting scores of smaller U.S. oil producers with the grim choice of either shutting older high-cost wells or burning through cash in the hope of riding out the downturn. As oil prices fell by more than half over the last six months from more than $100 per barrel, the U.S. oil industry responded by slowing its blistering growth and dialing back expansion plans. Now, with U.S. crude around $46 a barrel, operators are already closing some small old wells, known as strippers, and tens of thousands of similar wells are on the verge of losing money. A further slide could, by some estimates, idle an equivalent of up to 2 percent of U.S. supply, slowing overall output growth more than expected or even leaving it flat. Ray Lasseigne, an oilfield veteran and president of TMR Exploration Inc in Louisiana, is deciding which […]

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U.S. Seen Limiting Oil Drilling in Arctic, May Open Atlantic

The U.S. Interior Department will lay a framework as soon as Tuesday for oil exploration in the nation’s coastal waters in a five-year plan that is expected to withdraw areas off Alaska while possibly adding parts of the Atlantic. Republican Lisa Murkowski said the head of the offshore energy office told her the agency will place areas of the energy-rich U.S. Arctic off limits. Those areas had been previously deferred from new leasing. Current leases in the Arctic, such as those held by Royal Dutch Shell Plc (RDSA) , won’t be affected. “Maybe they’ve changed their minds after listening to the outrage from us. We’ll see,” Murkowski, the chairman of the Senate Energy and Natural Resources Committee, told reporters Monday. Jessica Kershaw, an Interior Department spokeswoman, didn’t respond to an e-mail asking about Murkowski’s comments. The agency’s proposed plan will control leasing in the Outer Continental Shelf, such as […]

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Keystone Pipeline Bill Stalls in Senate, Prolonging Debate

ENLARGE Some of more than 350 miles of pipe awaiting shipment for the Keystone XL oil pipeline is stored at Welspun Tubular, in Little Rock, Ark. Photo: Associated Press WASHINGTON—The Senate on Monday rejected a procedural motion to advance legislation to approve the Keystone XL pipeline, prolonging the chamber’s debate over the project. Amid a partisan fight over congressional procedure and absences due to weather and other conflicts, Senate Republican leaders couldn’t amass the 60 votes needed to end debate on the bill and move toward a final vote on approving the pipeline. The procedural vote was 53-39. While enough Senate Democrats support the pipeline to clear the 60-vote hurdle, several of them are fuming over a decision last week by Senate Majority Leader Mitch McConnell (R., Ky.) to vote against taking up Democratic amendments and to prevent Democrats from delivering one-minute floor speeches on their amendments. Their effort […]

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Hess Cuts 2015 Capital and Exploratory Spending

Hess Corp. is reducing its 2015 budget, joining a number of energy producers that have reduced spending plans amid a sharp decline in oil prices. The oil and gas company announced a 2015 capital and exploratory budget of $4.7 billion, down 16% from 2014 spending of $5.6 billion. Hess said it “is well positioned to manage through the current price environment” and said the budget “reflects a disciplined approach to maintaining our financial strength and flexibility while preserving our long term growth options.” Nymex WTI crude lost 7.2% last week, settling at its lowest value since March 11, 2009. The oil rig count in the U.S. declined by 49 last week, according to data by Baker Hughes Inc. ConocoPhillips and Marathon Oil Corp. have both projected 20% budget declines for 2015, while companies including Apache Corp. have announced layoffs. Hess said its planned budget includes about $2.1 billion of […]

Posted On : Published By : Tom Whipple