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Mysterious Gas Clouds China Energy Giants

PetroChina’s Beijing headquarters, with a traffic sign in the foreground, on March 17. ENLARGE Photo: Reuters When it comes to oil, China’s state energy behemoths have become more predictable, market-driven entities. But for increasingly important natural gas, investors still must turn to Beijing for clarity. PetroChina , the country’s largest producer of oil and gas, emphasized frugality late Thursday when it reported 2014 results. Like 2013, it slashed capital expenditures, with management targeting another 9% reduction in 2015. PetroChina even funded its big investments and dividends entirely out of operating cash flows, which wasn’t the case in 2013. China Petroleum & Chemical , the nation’s number two energy producer that’s better known as Sinopec, cut capital spending by 16% in 2014. It’s encouraging that China’s state-run companies are learning to live within their means, like Western majors. Anticorruption probes imposed discipline , as did oil’s price collapse. Investors should […]

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China’s crude oil output edges up

BEIJING, March 27 (Xinhua) — China’s crude oil output in the first two months rose slightly year on year, according to the country’s top economic planner on Friday. The National Development and Reform Commission (NDRC) said that crude oil production stood at 34.21 million tonnes in January and February, up 1.2 percent from a year earlier. The country refined 76.05 million tonnes of crude oil during the first two months, up 1.5 percent year on year, while output of refined products rose by 3 percent to 47.85 million tonnes, the NDRC said. Apparent consumption of refined oil products rose 8 percent from a year earlier to 42.93 million tonnes. In the same period, natural gas output rose 7.7 percent to 23.5 billion cubic meters, while imports climbed 15.5 percent to 10.7 billion cubic meters. Apparent consumption of natural gas rose 6.2 percent year on year to 34.1 billion cubic […]

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Chevron to divest 50% stake in Caltex Australia

Chevron’s executive vice-president of Downstream and Chemicals Michael Wirth said in a statement that the divestment is aligned with its previously announced asset sales commitment and is part of its desire to regularly review its portfolio and generate cash to support long term priorities. "Chevron will continue to ensure a reliable, high-quality supply of product is available to Caltex to supply to its retail and reseller franchise network. Chevron is also committed to seeking long-term relationship opportunities with Caltex." Caltex has a 109,000 b/d refinery at Lytton in Brisbane, which operated at 88.6% utilization last year. The company shut its 135,000 b/d refinery at Kurnell in Sydney in October 2014. The facility is currently being converted into an import terminal. The fall in crude prices resulted in a dramatic drop in Caltex’s profit to just A$20 million ($15.7 million) last year, down from A$530 million in 2013. Meanwhile, Chevron […]

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Canada’s New Brunswick Province Bans Fracking, Plans Study

PORTLAND, Maine, March 26 (Reuters) – Lawmakers in New Brunswick voted on Thursday to prohibit fracking in the eastern Canadian province, committing to study the controversial method of extracting oil and gas for one year before reconsidering the ban in 2016. The province’s Liberal-led government said it will require five conditions be met before the moratorium is lifted. These include beefed-up environmental and health regulations, a plan for waste water disposal, consultations with aboriginal groups, a royalty structure, and the establishment of a "social license," which is the approval by local communities and stakeholders. "It is responsible and prudent to do our due diligence and get more information regarding hydraulic fracturing," said Energy and Mines Minister Donald Arseneault. The province is the latest of several in eastern Canada, including Quebec, Labrador and Newfoundland, and Nova Scotia, to stop companies from fracking while they study its impact. New Brunswick is […]

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Oil Council: Shale Won’t Last, Arctic Drilling Needed Now

WASHINGTON (AP) — The U.S. should immediately begin a push to exploit its enormous trove of oil in the Arctic waters off of Alaska, or risk a renewed reliance on imported oil in the future, an Energy Department advisory council says in a study to be released Friday. The U.S. has drastically cut imports and transformed itself into the world’s biggest producer of oil and natural gas by tapping huge reserves in shale rock formations. But the government predicts that the shale boom won’t last much beyond the next decade. In order for the U.S. to keep domestic production high and imports low, oil companies should start probing the Artic now because it takes 10 to 30 years of preparation and drilling to bring oil to market, according to a draft of the study’s executive summary obtained by the Associated Press. "To remain globally competitive and to be positioned […]

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Some Energy Companies Find the Going Tough

ENLARGE A pump jack near Williston, N.D. The oil slump has created opportunities for lawyers and bankers. Photo: Daniel Acker/Bloomberg News The ranks of financially stressed companies have swelled to a 4½-year high as the sharp drop in oil prices batters energy companies. The number of companies with the worst below-investment-grade debt ratings rose to 184 in February, the highest count since November 2010, and remained at that level in March, according to Moody’s Investors Service. That is a 16% increase over March 2014. The 25 oil-and-gas and oil-services companies listed accounted for 13.6% of the total this month, their highest share ever. Moody’s tally of stressed companies includes only U.S. nonfinancial firms rated B3 with a negative outlook for future ratings changes or lower. The B3 rating is six notches into junk territory. “If this trend increases, we might see more defaults in the energy sector,” said Julia […]

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California Just Had a Stunning Increase in Solar

California is now the first U.S. state to get 5 percent of its annual utility-scale electricity from the sun. But that’s really understating what just happened.  The chart above, released this week by the U.S. Energy Information Administration, shows that in just one year, big solar jumped from 1.9 percent to 5 percent of the state’s total power generation. California isn’t just producing the most utility-scale solar electricity of any state; it’s producing more than all the other states combined .  And that’s only what the major electricity producers are generating—it doesn’t include rooftop solar, in which California is also leading the nation. In small-scale solar, capacity for another 2.3 gigawatts has been installed, according to the California Public Utilities Commission.  Renewable energy, including hydro power and rooftop solar, now constitutes about a third of California’s electricity, a remarkable feat accomplished through renewable requirements for utilities and incentives for homeowners.  But even that understates California’s […]

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Royal Dutch Shell to Cut 250 North Sea Jobs

Shell said it would cut 250 jobs in the U.K. North Sea. ENLARGE Illustration: Bloomberg LONDON— Royal Dutch Shell PLC said Thursday that it would eliminate at least 250 jobs in its U.K North Sea operations this year, the latest workforce cut for big energy companies trying to reduce spending as crude trades for about half its 2014 peak. The job cuts come on top of the 250 positions Shell eliminated last summer from its U.K. operations and represent another blow to a North Sea oil industry that has seen its often high-cost projects upended by an oil-price collapse. Shell, which has about 94,000 employees world-wide, had been trying to cut costs even before the oil price began falling, after being criticized by investors for years of heavy spending on big projects. The company said the cuts “are part of a range of initiatives Shell has been pursuing to […]

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Russia squeezed by sanctions, European leader says

Gabrielius Landsbergis, a Lithuanian member of the European Parliament, said sanctions on Russia having clear impact on its economy. Photo courtesy: European Parliament. BRUSSELS, March 26 (UPI) — Along with the low price of oil, sanctions imposed on Russia in response to crises in Ukraine have struck a major blow to its economy, a European leader said. The European Union in March 2014 imposed sanctions against Russia after it annexed the Crimean Peninsula from Ukraine. Violence erupted in Ukraine the previous November after the former Soviet republic started a slow pivot toward the EU. Sanctions imposed in July cut into the Russian energy sector, which accounted for more than half of the government’s revenue. Gabrielius Landsbergis, a Lithuanian member of the European Parliament steering aid to Ukraine, said Thursday the sanctions have created huge problems for the Russian economy. "It’s difficult to measure the exact results, but what we […]

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The Problem of the Human Population

This is a guest post by Javier Javier holds a PhD in Biochemistry and Molecular Biology and has been a scientist for 30 years in molecular genetics and neurobiology. He wrote a blog on macroeconomy and investments from a cyclic point of view for over two years and currently writes a blog in Spanish about the economic crisis, energy crisis and climate change at  http://www.rankia.com/blog/game-over/  . Javier goes by the name of Knownuthing on his blog. Opinions expressed in this post are those of Javier and not necessarily those of the blog owner Ron Patterson. This post was translated from the Spanish by computer and may therefore contain some grammatical errors. The Problem of the Human Population  The question of whether or not overpopulation in the world is clearly debatable. For starters there is no agreement on what should be the world’s population and is also clear that currently the […]

Posted On : Published By : Tom Whipple