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Russia Agrees Dispute Over East Ukraine Gas Won’t Endanger EU Supply

The energy ministers of Russia and Ukraine agreed Monday that a dispute over natural-gas deliveries to some rebel-controlled territories in eastern Ukraine won’t affect supplies to the rest of the country and the European Union. The spat between Ukrainian state gas company OAO Naftogaz and its main supplier, Russia’s OAO Gazprom , had endangered an EU-mediated deal that was meant to secure gas supplies during the cold winter months. It also raised questions on whether the two sides would be able to negotiate a follow-up arrangement to regulate deliveries over the summer months once the winter deal expires at the end of March. The agreement, following talks between the two ministers in Brussels, doesn’t resolve the question of who will ultimately pay for gas delivered by Gazprom to the Donetsk and Luhansk regions but not authorized by Naftogaz. Russian has been backing the rebels in those regions. The pact […]

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Ohio Sues BP For More Than $33 Million

Ohio is suing oil and gas company BP for more than $33 million, alleging it double dipped by taking state funds and money from insurers to clean up accidental leaks from underground storage tanks at hundreds of its gas stations around the state. The state’s attorney general and the Ohio Petroleum Underground Storage Tank Release Compensation Board filed the lawsuit Monday. The board administers a fund used as a last resort when tank owners lack coverage or don’t accept insurance money. The lawsuit alleges London-based BP wrongfully obtained $33.3 million in reimbursements from the fund, saying it had no insurance for the leaks when it often accepted insurance money for the same releases. BP PLC spokesman Jason Ryan says the company acted in good faith and will defend itself against the lawsuit. —Copyright 2015 Associated Press

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Crude on Derailed Train Contained High Level of Gas

The scene of a CSX crude-oil train burning after derailment in Mount Carbon, W. Va. ENLARGE Photo: Marcus Constantino/Reuters The crude oil aboard the train that derailed and exploded two weeks ago in West Virginia contained so much combustible gas that it would have been barred from rail transport under safety regulations set to go into effect next month. Tests performed on the oil before the train left North Dakota showed it contained a high level of volatile gases , according to a lab report reviewed by The Wall Street Journal. The oil’s vapor pressure, a measure of volatility, was 13.9 pounds per square inch, according to the Feb. 10 report by Intertek Group PLC. That exceeds the limit of 13.7 psi that North Dakota is set to impose in April on oil moving by truck or rail from the Bakken Shale. Oil producers that don’t treat their crude […]

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Houston Ship Channel closed for more than a day; dozens of ships delayed

Houston (Platts)–2Mar2015/912 am EST/1412 GMT The Houston Ship Channel remained closed to all traffic due to heavy fog for the second straight day Monday, a Houston Pilots dispatcher said. "We are still closed," he said. "We closed at 1:35 am (0735 GMT) Sunday." The dispatcher said the forecast remains gloomy. "It’s not looking too good," he said. "We may get a small window this afternoon, but it is supposed to get foggy again tonight." Article continues below… Dirty Tankerwire delivers the most important developments in the dirty tanker market, daily, direct to your desktop. Extensive listings and clear analysis of the latest freight and fixture rates help you effectively analyze the dirty tanker market. The dispatcher said about 60 ships — 30 inbound and 30 outbound — had been delayed as of 7:30 am Monday and clearing out the queue could take some time. "It all depends," he said. […]

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Low Oil Price May Stifle Deepwater Drilling And Oil Sands But Not Fracking

Saudi Arabia and OPEC may have dropped oil prices to stifle production in the U.S. and other competing nations, but they didn’t drop it enough to stifle the U.S. oil and gas boom from fracking, a senior expert with McKinsey and Company said in Chicago. “If the Saudis think they’re going to put U.S. shale players out of business, they’re probably not, although there will be less drilling,” Joe Quoyeser told about 125 people, mostly graduate students, at Northwestern University’s Kellogg Energy Conference on Wednesday. ”But there are other elements of oil supply that are needed to balance the market that will have a hard time competing at $50 a barrel, including oil sands in Canada and much of the deepwater resources.” Oil sands have to be heated to extract petroleum, a process that requires natural gas. Even at today’s low gas prices, that fixed cost means oil sands only become viable at […]

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Europe Unlikely to Meet Climate Goal, Study Finds

BERLIN — The European Union will fail to meet an ambitious goal of significantly reducing greenhouse gas emissions by 2050 unless it takes more aggressive measures to limit the use of fossil fuels and adopts new environmental policies, according to a report scheduled for release on Tuesday. Although European countries are on track to meet, and even surpass, the goal of reducing 1990-level greenhouse gas emissions by 20 percent by 2020, existing policies are not robust enough to ensure that the 2050 targets are met, the report said. Those targets, scientists have said, are critical to forestalling the most catastrophic effects of climate change , which are linked to carbon emissions caused by human activity. “The level of ambition of environmental policies currently in place to reduce environmental pressures may not enable Europe to achieve long-term environmental goals, such as the 2050 target of reducing greenhouse gas emissions by […]

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Oligarch’s oil deal caught in sanctions crossfire

North Sea oil rig or gas platform As first days at work go, Monday was eventful even by the standards of someone as experienced as Lord Browne. The former BP head took over as executive chairman of L1 Energy, a new $10bn oil and gas investment fund backed by Russian billionaire Mikhail Fridman, to find an unfolding row between his oligarch boss and UK energy secretary Ed Davey at the top of his in-tray. The peer, whose appointment completes a remarkable rapprochement with Mr Fridman, a one-time foe, will use his decades of energy industry expertise and extensive contacts book to lead a hunt for partnership deals and acquisitions. The assets acquired by Mr Fridman’s LetterOne group in a €5bn purchase completed on Monday of RWE Dea, the oil and gas arm of Germany’s RWE , are meant to form the cornerstone of an international energy business. There will […]

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Russia Eases Rules on Gas for Rebel-Held Areas of Ukraine — Update

By Gabriele Steinhauser in Brussels And Nick Shchetko in Kiev, Ukraine Russia’s energy ministry said Monday that Ukrainian gas company OAO Naftogaz won’t have to make advance payments for unauthorized gas deliveries to rebel-held regions in eastern Ukraine. Recent deliveries by Russia’s OAO Gazprom to the Donetsk and Luhansk regions will be "taken out of the equation" when calculating prepayments for Naftogaz, the ministry tweeted from its verified Twitter account. "This will be a matter of a separate reconciliation and separate negotiations," the ministry added. Russian Energy Minister Alexander Novak was in Brussels Monday for European Union-mediated talks with his Ukrainian counterpart. The talks followed complaints from Naftogaz that Gazprom had been supplying gas to rebel-held regions in eastern Ukraine and had reduced deliveries to the rest of the country. Russia has been backing the rebels. Naftogaz claimed that Gazprom was in breach of a supply deal between the […]

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Russia to Avoid Using Global Debt Markets in 2016, Minister Says

(Bloomberg) — Russia doesn’t expect to access international debt markets in 2016 after already ruling out issuing foreign bonds in 2015 to help finance its budget deficit, Finance Minister Anton Siluanov said. The country, which has issued more than $22 billion of bonds abroad since 2010, is facing higher borrowing costs in global markets amid U.S. and European Union sanctions after President Vladimir Putin’s annexation of Crimea a year ago. Russia previously planned to borrow as much as $7 billion in 2016 and another $7 billion in 2017, according to the most recent budget approved by Putin. “We should be more realistic and put in our budget internal borrowings as sources” to cover the deficit, Siluanov told reporters Monday in Moscow. Russia’s credit rating was cut below investment grade by Moody’s Investors Service and Standard & Poor’s this year as policy makers struggle to keep economic growth. Russia may […]

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Exxon’s Russia Exposure Surges as Long View Outweighs Sanctions

Rex Tillerson, Chief Executive Officer of Exxon Mobil Corp., is scheduled to brief a gathering of investors and analysts on the company’s growth outlook at the New York Stock Exchange on Wednesday. Photographer: Andrey Rudakov/Bloomberg (Bloomberg) — Exxon Mobil Corp. shook off the chill of sanctions and has continued to snap up oil drilling rights in Russia, giving it larger exploration holdings in Vladimir Putin’s backyard than in the U.S. Taking the long view, Exxon boosted its Russian holdings to 63.7 million acres last year from 11.4 million at the end of 2014, according to data from U.S. regulatory filings. That dwarfs the 14.6 million acres of rights Exxon holds in the U.S., which until last year was its largest exploration prospect. While U.S. and European Union sanctions against Russia forced Exxon to shut down an Arctic drilling project in October, the producer is staking claims to areas that […]

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