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Study: Oil Price Downturn Creates Need for ‘Cost Culture’ in Industry

URL: http://www.rigzone.com/news/oil_gas/a/137267/Study_Oil_Price_Downturn_Creates_Need_for_Cost_Culture_in_Industry Companies across all sectors of the oil and gas industry will need to create a "cost culture" to survive the recent downturn in oil prices, according to a study by AlixPartners. Companies across all sectors of the oil, gas and chemicals industry will need to better plan and manage projects to ensure their survival during the recent downturn in oil prices, according to a recent study by global business advisory firms AlixPartners. Oil and gas companies not only need to improve their ability to plan and manage projects, but create a “cost culture” inside of their companies. Only 30 percent of respondents in a study of 250 high-level industry executives across the world said their companies had explicit return-on-capital targets for projects before the oil price collapse. Perhaps most surprising is that 12 percent of respondents believe their companies are any better than competitors at project execution, […]

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Chesapeake Energy Sues Ousted Founder

ENLARGE Aubrey McClendon, former chief executive of Chesapeake Energy, called the company’s lawsuit “baseless” and accused Chesapeake of trying to breach his severance agreement. Photo: Reuters Chesapeake Energy Corp. sued its ousted founder, Aubrey McClendon , claiming Tuesday that he stole sensitive data in the days before he left in 2013. The company alleges that Mr. McClendon, while still running the company, had his assistant print out maps and data about oil and gas prospects in Ohio and sent the same information to his personal email address. “Due to the concealed nature of McClendon’s conduct, Chesapeake did not discover McClendon’s misappropriation until long after he had separated from Chesapeake,” the company stated in a lawsuit filed in Oklahoma County District Court. Mr. McClendon, who founded rival American Energy Partners LP after leaving Chesapeake, called the lawsuit “baseless” and accused Chesapeake of trying to breach his severance agreement. American Energy […]

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Kinder Morgan Acquires Hiland

$3 Million Deal Moves Company into Bakken Contenental Resources CEO, Harold Hamm Kinder Morgan announced last week that it finalized the acquisition of Hiland Partners, a midstream firm founded by Harold Hamm, CEO of Continental Resources. The deal, reported at $3 billion, includes assuming almost $1 billion in debt. Hiland primarily serves production from the Bakken Formation in North Dakota and Montana and by operating crude oil gathering/transportation pipelines and gas gathering/processing systems including roughly 1,225 miles of pipeline. Company officials anticipate retaining nearly all of Hiland’s approximately 430 employees. “We are delighted to establish a substantial midstream footprint in one of the most prolific oil producing basins in the United States,” said KMI Chairman and CEO Richard D. Kinder. “Hiland’s systems serve some of the Bakken’s largest and most successful producers, including Continental. We look forward to continuing to provide high quality midstream services to these producers and […]

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U.S. gasoline prices following oil markets

Retail price for a gallon of regular unleaded gasoline on the rise, mirroring rally in crude oil prices. Photo by John Angelillo/UPI Crude oil prices have recovered more than 20 percent of their value since the end of January in part because the 2014 slump in prices left energy companies with less money to spend on exploration and production. Patrick DeHaan, a senior analyst at GasBuddy.com, said that increase is showing up at the pump . "Prices at the pump are starting to heat back up, mostly driven by a rebound in crude oil prices," he said in a statement Monday. "Nationally, almost 9 in 10 stations are selling over $2 per gallon, while a month ago, less than half of stations were selling over that price." GasBuddy.com shows a national average price Tuesday of around $2.26 for a gallon of regular unleaded gasoline, up about a penny from […]

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Ohio City Loses Fight for Control Over Oil and Gas Drilling

In this Wednesday, Jan. 4, 2011 file photo, a brine injection well in Youngstown, Ohio. (Bloomberg) — An Ohio city lost a battle for control over oil and gas drilling permits within its borders with the Ohio Supreme Court saying the authority belongs to the state. The ruling on Tuesday runs counter to decisions issued by New York’s top court last year and the highest Pennsylvania court in 2013 as local municipalities concerned over the effects of hydraulic fracturing seek to limit the practice. More than 400 measures to prevent or control fracking have been passed by U.S. cities and counties according to Food & Water Watch, a Washington-based environmental advocacy group. The process, which involves the injection of water, chemicals and sand below ground to extract oil and gas from shale formations, has been criticized as environmentally dangerous, even as its use has driven U.S. natural gas production […]

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CSX train hauling North Dakota oil derails, cars ablaze in West Virginia

BECKLEY, W.Va. (Reuters) – A CSX Corp train hauling North Dakota crude derailed in West Virginia on Monday, setting a number of cars ablaze, destroying a house and forcing the evacuation of two towns in the second significant oil-train incident in three days. One or two of the cars plunged into the Kanawha River, and “a couple are burning," said Robert Jelacic, night shift manager of the West Virginia Department of Homeland Security and Emergency Management. There were no injuries or deaths, he said. CSX said the train was hauling 109 cars from North Dakota to the coastal town of Yorktown, Virginia, where midstream firm Plains All American Pipelines runs an oil depot. It said one person was being treated for potential fume inhalation. West Virginia State Police First Sergeant Greg Duckworth, who was at the crash site, told Reuters that nine or 10 of the cars had exploded […]

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Oil-Train Fireball Seen Adding Pressure for U.S. Safety Decision

Derailed oil tanker train cars burn near Mount Carbon, West Virginia, on Feb. 16, 2015. Photographer: Marcus Constantino/The Daily Mail via AP Photo (Bloomberg) — Video images of a fireball boiling from the wreckage of a derailed train hauling Bakken crude are adding to pressure on federal regulators to act on new safety standards for oil shipments. While there were no fatalities in the CSX Corp. accident in rural West Virginia on Monday, the footage of flames and smoke rekindles public alarm over the prospect of tank cars rumbling through urban areas, according to a former U.S. Transportation Department official and a railroad consultant. “It weakens the railroad’s and the industry’s ability to argue on the merits” to shape the government’s decision, Brigham McCown, a former chief of the Pipeline and Hazardous Materials Safety Administration, said by phone Tuesday. “In Washington, D.C., perception is reality. Railroads have to get […]

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Russia expects prolonged economic slump

Russian economy to enter period of prolonged decline, Kremlin report says. File Photo by Denis Larkin/Shutterstock MOSCOW, Feb. 17 (UPI) — Russia’s economy is entering a period of prolonged retraction because of the dual strains of sanctions and weak crude oil markets, the Economy Ministry said. A forecast for 2015 by the Russian Economy Ministry expects export revenues to decline as Russian energy products wane from the world market. "Gross domestic product is expected to contract by 3 percent amid persistently strong geopolitical risks and the presumption that average annual oil prices will equal $50 per barrel," the document, released Monday, said. "Forecasts show that the Russian economy will enter a phase of a prolonged decline in 2015." Russia’s currency, the ruble, is contracting as the economy weakens. The ruble was trading near 63 to the U.S. dollar, close to a historic low. In December, the World Bank said […]

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EU gas security at risk, commissioner says

European markets need a more diverse supply of natural gas to reduce risks posed by Russia, commissioner says. UPI/Hamid Forotan. European markets get about 20 percent of their natural gas needs met by Russia, though most of that gas runs through the Soviet-era transit network in Ukraine. Simmering conflict, despite a recent cease-fire agreement, and ongoing debt rows between Kiev and Moscow expose a layer of vulnerability in the European economy. EU Climate Action and Energy Commissioner Miguel Arias Cañete said energy diversity means energy security for member states. "Without swift and decisive action, member states will remain dependent on a single supplier that views the sale of gas not simply as a commercial matter, but as a political weapon," he said in an address to policymakers in Brussels. Contractual rows between Kiev and Moscow resulted in gas supply disruptions for Europe in 2006 and 2009. In response, member […]

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UK approves world’s biggest offshore wind farm

Scroby Sands offshore wind farm in the North Sea off Norfolk, south of the planned superfarm The world’s biggest offshore wind scheme has been given the go-ahead off the coast of Yorkshire, in a move the government said was likely to create hundreds of jobs. The Dogger Bank Creyke Beck project is expected to be one of the UK’s biggest power stations, second only to the Drax coal-fired plant in North Yorkshire and capable of supplying about 2.5 per cent of the country’s electricity. More On this topic IN UK Politics & Policy The scheme’s developers have yet to take a final investment decision and the project will almost certainly have to secure backing under the government’s renewable energy subsidy system. But the government’s planning consent for such a large development was welcomed by the industry. “This is an awesome project,” said Nick Medic, director of offshore renewables at […]

Posted On : Published By : Tom Whipple