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Why Shippers Are Turning to LNG-Powered Vessels

When TOTE Inc., a shipper that operates between the U.S. and the Caribbean, launched its latest container ship last month, the 760-foot craft carried a certain distinction: It’s only the second of the massive vessels worldwide fueled by liquefied natural gas. The first was launched four months earlier by the same company. TOTE is among a growing number of shipowners turning to natural gas at a time of record output, stringent emission rules and churning oil prices. About 70 vessels of all sizes worldwide of are now powered by LNG, up from 42 in just two years, according to DNV GL, which certifies ships for safety. By 2020, the number may pass 1,000. “More companies see natural gas as a viable alternative fuel source, given the abundance of supply and the relatively stable prices,” Peter Keller, executive vice president of Princeton, New Jersey-based TOTE, said in a telephone interview. […]

Posted On : Published By : Tom Whipple
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Oil Drillers Face Shrinking Credit Lines as Banks Revalue Assets

Oil producers in the U.S. are about to see their credit lines shrink, just when they need the money most. The latest round of twice-yearly reevaluations is under way, and almost 80 percent of oil and natural gas producers will see a reduction in the maximum amount they can borrow, according to a survey by Haynes and Boone LLP, a law firm with offices in Houston, New York and other cities. Companies’ credit lines will be cut by an average of 39 percent, the survey showed. "There’s going to be a reduction to the majority of these credit lines," said Neal Dingmann, an analyst at SunTrust Robinson Humphrey Inc. "It’ll make a lot of these companies reduce a bit more on spending." In many cases, banks have first claim on assets in a bankruptcy, and the size of a loan is tied to how much an oil producer’s acreage […]

Posted On : Published By : Tom Whipple
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Fracking Firms That Drove Oil Boom Struggle to Survive

As energy companies drill fewer wells, some small firms that frack wells face bankruptcy. A wave of bankruptcies and closures is sweeping across the oil patch, with dozens of hydraulic-fracturing companies at risk, industry experts say. Most of the companies that help oil-and-gas explorers drill and frack wells are small, privately owned and just a few years old. They are part of a flood of new entrants in the energy business—one that is drying up as oil prices languish below $50 a barrel. One of the latest casualties is Pro-Stim Services. Launched in 2011 with backing from Turnbridge Capital LLC, a private-equity firm, the company did work for oil-and-gas producers eager to coax more fuel out of the ground in places like Texas and Louisiana. “The Haynesville Shale was blowing and going at that time,” said Bubba Brooks, who founded the company in Longview, Texas, after working in the […]

Posted On : Published By : Tom Whipple
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After Volkswagen Revelation, Auto Emissions Tests Come Under Global Scrutiny

Photo The Volkswagen plant in Wolfsburg, Germany. The emissions cheating scandal at Volkswagen has initiated a reconsideration of how pollution tests are carried out worldwide. Credit Alexander Koerner/Getty Images In the United States, automakers conduct their own emissions tests and submit the results to the government. In Europe, automakers pick who conducts the tests and where they are done. And these two regulatory systems are considered the world’s gold standards. Questions about the wisdom of allowing automakers so much sway in how air pollution standards are enforced grew on Wednesday after the resignation of Volkswagen’s chief executive , following the company’s diesel emissions cheating scandal . Regulators in several European countries have opened investigations, attorneys general in the United States have joined federal inquiries, and there has been broader criticism of Volkswagen , and diesels, in markets from South Korea to Brazil. Volkswagen has admitted installing software in 11 […]

Posted On : Published By : Tom Whipple
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Oil Companies in Europe Seek Creative Funding as Lenders Retreat

Oil services companies in Europe are finding alternative ways to raise cash and repay debt after falling crude prices made it difficult for them to get funding from traditional sources. Dolphin Group AS has sought to persuade private-equity and hedge funds to finance projects exploring and mapping seabeds in return for interest tied to sales, according to people familiar with the matter. At least two Norwegian drillers are planning to sell and lease back ships to raise cash and fund operations as they struggle to access loan and bond markets, said the people, who asked not to be identified because the matters are private. Energy companies are being shut out of bond markets and lenders are reducing credit lines after prices dropped about 60 percent from last year’s peak. Services companies in Europe are starting to run out of cash as producers from Royal Dutch Shell Plc to Petroleo […]

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As UN says world to warm by 3 degrees, scientists explain what that means

As nations around the world prepare to sign a global climate treaty in Paris this December at the United Nations Conference of the Parties (COP21), the U.N.’s climate chief has said thatthe world is still on track for dangerous warming. Most leaders and scientists have agreed that limiting the global average temperature rise to 2 degrees Celsius over the next century could yet ward off the worst effects of climate change . But the world remains on a trajectory to experience an increase of 3 C — even if the national emission reduction pledges to be codified in the Paris treaty are implemented — said Christiana Figueres, executive secretary of the U.N. Framework Convention on Climate Change. Her comments came ahead of visiting Pope Francis’ U.N. General Assembly speech on Friday, when he is widely expected to weigh in on the dangers of climate change. Al Jazeera asked scientists […]

Posted On : Published By : Tom Whipple
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Putin works to counter impact of low oil prices

Russian President Vladimir Putin says budget planners need to work to counter the impact of low crude oil prices and other external pressures. File photo by Luo Xiaoguang/Pool MOSCOW, Sept. 23 (UPI) — A Russian economy struggling under the dual pressures from sanctions and low crude oil prices needs to work to overcome recession, the Russian president said. "In the present environment, it is particularly important to provide a set of measures to overcome the economic recession and maintain the role of the federal budget as one of the leading development tools," President Vladimir Putin said in a statement. The Russian economy teetered on the brink of recession when entering fiscal year 2015. In early September, the Bank of Russia said it was keeping the key rate at 11 percent annually because of higher inflationary risks and "persistent risks of considerable economy cooling." The International Monetary Fund in January […]

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Russian Economy Ministry Opposes Higher Oil Tax to Defend Output

Russia’s Economy Ministry criticized a proposed tax increase on the nation’s main revenue source, crude producers, saying it may hurt output and the budget in the long term. The oil-extraction tax formula proposed by the Finance Ministry last week would hurt “the economics of working deposits and in fact would ’kill’ production at the most efficient fields in terms of tax performance,” Deputy Economy Minister Nikolay Podguzov said in an e-mailed statement. “Clearly, if production decreases, taxes also fall.” Struggling with its first recession in six years, Russia’s budget may gain more than 600 billion rubles ($9.1 billion) of additional revenue next year if the government raises the crude output levy, according to the Finance Ministry. That’s a “significant” overestimation, Podguzov said. While President Vladimir Putin told the government to weigh the tax proposal on Tuesday, there’s no final decision yet, Finance Minister Anton Siluanov said. Shares in the […]

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How long will fossil fuels last?

The end, said a reincarnated Cassandra, is nigh. Abundant supplies of fossil fuels will end, bringing down the economic order with it. After all, she argued, at current rates of production, oil will run out in 53 years, natural gas in 54, and coal in 110. We have managed to deplete these fossil fuels – which have their origins somewhere between 541 and 66 million years ago – in less than 200 years since we started using them. Cassandra – the Princess of Troy – had been blessed with the gift of prophesy by the Greek God, Apollo. In her modern avatar, she projected how many years these fuels would last by measuring the R/P ratios (that is the ratio of reserves to current rates of production) of fossil fuels. She juxtaposed it with the World Energy Outlook study by the International Energy Agency, which estimated that even with […]

Posted On : Published By : Tom Whipple
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We Should Have Seen This Refugee Crisis Coming

There are some things we can never know: The grief of a Syrian father as he finds his three-year-old son lifeless on the beach; how it feels to leave your home and community behind in the dark of night, knowing you may never return, with nothing but the need to keep your family safe from harm. But we should be able to know when and where the next migration will occur. We should be able to predict how many people it will affect and the impact on surrounding areas. We have the technology—right here, right now—to create a new, agile, insightful model that will predict mass migrations and help us better serve displaced families even before they are displaced. We can do all this now. And we must. Over the past few weeks I have watched along with the rest of the world as the refugee crisis reached a […]

Posted On : Published By : Tom Whipple