Thursday, 31 July 2014

Oryx Petroleum reports first sales from Demir Dagh in the Kurdistan

Oryx Petroleum Corp. has sold its first offtakes of crude oil into the domestic market from the Demir Dagh field in the Hawler license area in the Kurdistan Region of Iraq. Oryx Petroleum is the operator and has a 65% participating and working interest in the Hawler license area.
Michael Ebsary, Oryx Petroleum’s CEO, stated: “We are delighted to announce that we have completed our first sales from the Demir Dagh field. This is a critical milestone in Oryx Petroleum’s evolution to becoming a full-cycle exploration, development and production company. We now look forward to increasing production, revenue and cash flow as we continue to develop Demir Dagh and our other Kurdistan discoveries.”
The corporation recorded its first lifting of crude oil on June 20 from the Demir Dagh field. Through June 22, 2014, the Corporation has recorded liftings totaling approximately 3,300 bbl of crude oil. The liftings are pursuant to a short term agreement to sell crude oil to a third party marketer designated by the Ministry of Natural Resources (MNR) of the Kurdistan Regional Government.

The Demir Dagh crude oil has been sold at a price of just under $60 per barrel (as determined by the MNR) reflecting local market pricing dynamics and the medium sweet quality of the crude oil.
In accordance with the crude sales agreement, Oryx Petroleum is paid in advance on a regular basis throughout the term of the agreement for scheduled liftings. Liftings are continuing and are scheduled to ramp-up over the term of the agreement. The corporation expects that the agreement will be renewed at the end of its term, consistent with domestic sales practices in the Kurdistan Region of Iraq.

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Tuesday, 29 July 2014

Rosneft raises $1.5 bn through selling BP fuel in advance

OAO Rosneft, Russia’s largest oil producer, raised at least $1.5 billion through a five-year deal to supply crude oil and fuel to BP.

BP will pay in advance for as much as 12 million tons of oil products and crude to be supplied during the next five years, starting in July, Rosneft said in a statement today, June 27.

State-run Rosneft is increasingly using more pre-payment deals to raise funds, a trend that may accelerate as deteriorating relations between Russia, the U.S. and Europe make it more expensive to borrow in mainstream debt markets. The company’s CEO, Igor Sechin, said in February that pre-payments could total more than $100 billion by 2017.

The Moscow-based company already has agreements with oil traders Glencore Plc and Vitol Group as well as Chinese customers including China National Petroleum Corp.

A number of the world’s leading financial institutions participated in today’s deal with BP, Rosneft said without naming the banks.

U.K. banks HSBC Holdings Plc and Lloyds Bank Plc withdrew from the group arranging the finance on concern that lending to Russian companies was too risky after the imposition of U.S. and European Union sanctions, people familiar with the matter said earlier this month.

BP became Rosneft’s largest shareholder after the Russian state last year when it acquired a 19.8% stake as part of deal to sell its shares in oil explorer TNK-BP.

The deal “allows Rosneft to support high profitability of its sales activities and acquire additional financial resources,” Sechin said in today’s statement. “Rosneft extends and strengthens its mutually beneficial cooperation with BP.”

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Sunday, 27 July 2014

Exxon’s Norway output threatened as Union readies pension strike

A Norwegian oil-workers union said it’s ready to go on strike over pensions in a move that threatens to cut oil production from Exxon Mobil Corp.’s platforms in the North Sea by more than 60,000 bpd.

A court in Oslo today, June 23, ruled that a strike notice by the Safe union that would affect three Exxon platforms is legal, clearing the way for a walkout, according to the group’s leader, Hilde-Marit Rysst. While the union is yet to decide on a public mediator’s proposal that seeks to bridge differences with employers, it will do so by the June 27 midday deadline, she said by phone today.

“Everything is set” for a strike, Rysst said. The mediator’s proposal, endorsed by the Norwegian Oil and Gas Association, which represents employers in wage negotiations, “is not good enough,” she said.

A strike would set Safe apart from two other unions that reached wage agreements in talks that covered 7,615 offshore oil-platform workers. In 2012, workers from all three unions walked out in their longest action, disrupting oil and gas production until the government intervened to stop companies imposing a full lockout that would have halted output from western Europe’s largest producer.

The conflict centers on pension terms for 31 Safe-affiliated workers at Exxon. While the Norwegian Oil and Gas Association argued that the issue isn’t relevant for industry-wide wage talks, the Oslo court ruled Safe’s strike notice is legal.

Union Threat

The Norwegian Oil and Gas Association could meet with Safe again this week after last week’s state-backed mediation, though there are no talks planned yet, the oil-industry lobby group’s spokeswoman Eli Ane Nedreskaar said by phone. Exxon declined to comment on talks with the union as it’s represented by the Norwegian Oil and Gas Association, spokesman Knut Riple said.

Safe has threatened to take out 154 of its members from Exxon’s Balder, Ringhorne and Jotun platforms, shutting down production that reached 61,000 barrels of oil in April, according to figures from the Norwegian Petroleum Directorate. A strike would also halt production at Det Norske Oljeselskap ASA’s Jette field, which goes through Jotun and amounted to 2,000 barrels of crude a day in April.

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Friday, 25 July 2014

WTI trades near $106 after U.S. crude stockpiles increase

West Texas Intermediate crude traded near $106 a barrel after a government report showed that U.S. stockpiles unexpectedly increased. Brent dropped as Iraq pledged to increase production and exports.

Crude supplies rose 1.74 MMbbl to 388.1 million last week, the Energy Information Administration said. A 1.7 million-barrel decline was projected, according to the median of eight responses in a Bloomberg survey. The U.S. Commerce Department granted Pioneer Natural Resources Co.’s request to classify stabilized condensates as petroleum products eligible for export, the company said.

“Supplies are in good shape,” said Chip Hodge, who oversees a $9 billion natural-resource bond portfolio as senior managing director at John Hancock in Boston. “People in the market are trying to figure out if we’ll be able to export substantial amounts of crude. My gut tells me that it’s not going to be a big game changer because of political pressure.”

WTI for August delivery rose 19 cents to $106.22 a barrel at 11:38 a.m. on the New York Mercantile Exchange. Futures traded at $105.85 before the release of the report at 10:30 a.m. in Washington. The volume of all futures traded was 59% higher than the 100-day average.

Brent for August settlement declined 92 cents, or 0.8%, to $113.54 a barrel on the London-based ICE Futures Europe exchange. Trading volume was 23% above the 100-day average.

The European benchmark crude traded at a $7.32 premium to WTI, down from $8.43 yesterday, June 24.

‘Big Activity’

“The big activity today is in the WTI-Brent spread, and this is a reaction to the condensate exports,” said Tim Evans, an energy analyst at Citi Futures Perspective in New York. “Depending on who you speak to this is either the most dramatic news in a while or not a big deal because minimally processed condensates have long been exported.”

The U.S. opened the door to more ultra-light oil exports as long as the condensate is lightly processed, tempering the impact of a law that’s banned most overseas petroleum shipments for the past four decades. The oil industry has pressured President Barack Obama to end a ban on most crude exports.

“As far as we know, this is the first time they’re allowing condensates that have been run through a stabilizer to qualify” for exports, said Robert Dillon, a spokesman for the U.S. Senate Energy and Natural Resources Committee. Products from condensates refined through a unit known as a splitter are already allowed to be exported.

Crude Production

U.S. crude production declined 31,000 barrels to 8.45 million a day. Output has surged this year as a combination of horizontal drilling and hydraulic fracturing has unlocked supplies trapped in shale formations, including the Bakken in North Dakota and the Eagle Ford in Texas.

Crude stockpiles at Cushing, Oklahoma, the delivery point for WTI traded on Nymex, rose 416,000 barrels to 21.8 million in the week ended June 20, the EIA said.

Refineries operated at 88.5% of capacity last week, up 1.4 percentage points from the prior week.

“It shouldn’t be a surprise that U.S. refinery activity is increasing because they have the advantage of cheaper crude and there’s been a lot invested in increasing capacity,” said Kyle Cooper, director of research with IAF Advisors and Cypress Energy Capital Management in Houston. “The U.S. is becoming the world’s refiner which is good for economic growth and jobs.”

Gasoline Stockpiles

U.S. gasoline stockpiles increased 710,000 barrels to 215 million last week. A 1.45 million-barrel gain was projected in the survey. Consumption declined 4.8% to 8.81 MMbpd.

Gasoline futures for July delivery fell 3.83 cents, or 1.2%, to $3.0875 a gallon on the Nymex. Ultra-low sulfur diesel for July delivery slipped 2.17 cents, or 0.7%, to $3.0199.

Brent dropped as much as 1.1% after Iraq’s oil minister said the nation’s crude exports will jump next month, adding to signs that fighting in the country’s north isn’t affecting the south, where most of the country’s output occurs.

“Oil exports will witness a big increase, as recent events didn’t reflect negatively on Iraq’s crude output and exports,” Oil Minister Abdul Kareem al-Luaibi said in an interview in Baghdad today, June 25. “International oil companies are working normally in Iraq.”

The first American military advisers have begun to assess the conflict in Iraq. A small contingent of U.S. forces has begun operating to gather intelligence and establish an operations center in Baghdad, the Defense Department said yesterday. Insurgents captured the northern city of Mosul this month and have advanced to towns just north of the capital, threatening to split OPEC’s second-largest oil producer.

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Wednesday, 23 July 2014

Emerson opens new flow loop facility

Emerson Process Management has opened a new flow loop facility for Roxar technologies in Stavanger. The facility will increase production capacity and drive future developments in multiphase meters, enabling oil and gas operators to access continuous well and flow rate information and derive maximum reservoir performance from their multiphase meters and production data.
The purpose-built facility is designed to replicate three-phase flows in oil and gas production and will play a key role in ensuring that Emerson continues to support its oil and gas customers by delivering reliable and accurate topside and subsea flow meters that operate across all reservoir conditions over the lifetime of a well.
The 200 sq m flow loop facility will also increase capacity to run Factory Acceptance Tests (FAT) without relying on third party facilities, thereby improving delivery times. The new facility is also an important tool for research and development, enabling easy access for the testing of both existing and new technologies and concepts.
“That’s why the flow loop facility and the technologies incorporated within it are so important. The new facility will allow us to rigorously test and validate our flow metering portfolio, enable us to increase production capacity and control our delivery schedules, and ensure that we continue to drive innovation in flow metering,” said Steve Grundmeier, president of Emerson’s Roxar business
The flow loop facility mixes diesel, salted tap water and nitrogen to imitate the multiphase flow coming out of oil and gas production wells. Emerson’s Micro Motion ELITE Coriolis meters provide reference measurements and Emerson’s DeltaV distributed control system is used to control and operate the flow loop and log data from the reference instrumentation and the multiphase meters being tested.
The new facility is part of Emerson’s global investment in flow measurement technology facilities and services and adds to the existing flow manufacturing and service network, including facilities in the U.S., Brazil, Mexico, the Netherlands, Romania, the UAE, China, Japan, Singapore and Australia.

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Monday, 21 July 2014

Energy industry belief in U.S. independence grows, KPMG says

More oil and natural gas company executives believe the U.S. will be able to satisfy its energy needs without having to rely on other countries by 2030, a KPMG International survey shows.

Seventy-three percent of energy executives surveyed by KPMG say the U.S. can become energy independent within the next 16 years or sooner. That’s up 10 percentage points from its 2013 survey, according to the audit, tax and advisory services firm.

The U.S., the world’s third-largest oil producer, behind Saudi Arabia and Russia and the biggest natural gas producer, is shedding its reliance on foreign energy sources thanks to technology that’s allowed it to tap hard-to-reach oil and gas in shale formations in North Dakota, Texas, Pennsylvania, Colorado, Wyoming and Oklahoma. U.S. crude output topped 8.47 MMbpd in the second week of June, the most since October 1986, and will average 9.27 million in 2015, according to the Energy Information Administration.

“Exciting new breakthroughs are leading to a whole new generation of domestic oil and gas production, particularly from deepwater, oil sands and shale assets,” John Kunasek, national sector leader for energy and natural resources for KPMG LLP, said in the statement.

Stable Prices

The survey of more than 100 senior executives in the U.S. representing global energy companies also found that the officials say oil and gas prices will stay relatively stable this year. Forty-seven percent of respondents say the average price of natural gas for 2014 will be in the range of $3.76 per million British thermal units to $4.50, while 44% of respondents expect Brent crude this year will average from $106 a barrel to $111, KPMG said in the statement.

As of yesterday, June 23, natural gas on the New York Mercantile Exchange had averaged $4.656 per million Btu since the beginning of the year and Brent crude, a benchmark for global prices, had averaged $108.63 a barrel on the London-based ICE Futures Europe exchange over that period. In trading today, natural gas for July delivery rose 5.8 cents, or 1.3%, to $4.504 per million British thermal units, while Brent for August settlement rose 36 cents to $114.48 a barrel.

The survey also found that energy firm executives in the U.S. expect mergers and acquisitions in their industry to be brisk over the next three years and the U.S. economy to continue to strengthen over the next year.

The web-based survey was completed in April by KPMG LLP, the U.S. member firm of Zurich, Switzerland-based KPMG International, company spokeswoman Megan Dubrowski said in an email.

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Saturday, 19 July 2014

Genel’s Kurdistan oil production jumps after pipeline opens

Genel Energy Plc, the oil explorer headed by former BP Plc CEO Tony Hayward, said production jumped in June after Iraq’s Kurdistan region opened an export pipeline to Turkey.

Net production averaged 84,000 bpd in June compared with a 63,000 bpd rate for the whole of the first half, the company said in a statement.

The opening of the pipeline in May allowed the autonomous region to increase exports through Turkey, bypassing the central Iraqi network. While the government in Baghdad disputes Kurdistan’s right to sell oil directly, the regional administration has sold a cargo of oil at international prices and banked the proceeds in a Turkish bank, Genel said.

Kurdistan, which plans a referendum on independence from Iraq, has largely remained calm as Islamist militants fight the central government for control of large parts of the country. London-based Genel said its operations remain safe and secure.

Genel maintained a forecast for average output in 2014 of 60,000 to 70,000 bpd and said revenue would be $500 million to $600 million.

The pipeline will allow Kurdistan to raise exports to 200,000 to 250,000 bpd this month from 125,000 bbl early last month, Ashti Hawrami, the regional natural resources minister, said on June 18. Daily shipments may increase to 400,000 bbl by the end of the year, he said.

Iraq, excluding the Kurdish region, holds 150 billion bbl of proven crude reserves in the world’s fifth-biggest deposits. The Kurdistan regional government controls 45 billion bbl and has attracted international oil companies including Genel, Exxon Mobil Corp. and Total SA with financial terms many see as more generous than those in the rest of the country.

Genel fell 0.8% to 1,015 pence by 8:31 a.m. in London. The company said today, July 3, an exploration well off Malta was plugged and abandoned without discovering oil and gas.

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Thursday, 17 July 2014

Iraq’s Kurds vow to keep Kirkuk oil fields until referendum

Iraq’s semi-autonomous Kurds plan a referendum for independence and will keep troops in the nearby oil hub of Kirkuk until people there can vote on whether to join the Kurdish enclave, a regional government spokesman said.

“As a people, we have the right to be independent, but the issue is up to the Kurdish people, to be decided upon via a referendum,” Safeen Dizayee, spokesman of the Kurdistan Regional Government, said in an interview in the city of Erbil yesterday, June 30. “We now have arrived at a new reality. If the Kurdish people, through referendum, were to opt for complete independence, we want it to be done through negotiations with Baghdad, like what happened in Czechoslovakia.”

Iraq’s minority Kurds, who historically have resisted control by Arab-dominated central governments, are charting a course to independently develop oil reserves that the KRG calculates at 45 billion bbl - larger than BP Plc’s estimate for deposits in the U.S. or Nigeria, Africa’s biggest producer. Kurdish armed forces moved last month outside their region in northern Iraq and occupied the long-disputed Kirkuk oil fields after the Iraqi army fled from Islamist militants.

Iraq’s central government in Baghdad said any referendum the Kurds may hold, whether to determine the future of the city of Kirkuk and its nearby oil fields or to declare independence for the Kurdish region itself, would be unlawful. “The government doesn’t accept anything outside the constitutional way, which was voted on by the Kurds,” Ali al-Moussawi, media adviser to Iraqi Prime Minister Nouri al-Maliki, said by phone in response to Dizayee’s comments. “If they do this, it would be unilateral and unconstitutional.”

Peshmerga Deployed

The KRG and its Peshmerga armed forces will maintain control of Kirkuk and other disputed areas they hold outside their region until people there can vote on joining the Kurdish enclave, Dizayee said, without providing a date for such a referendum. Kirkuk, including Iraq’s fourth-biggest oil deposit, is an ethnically mixed area claimed also by the central government.

“The KRG can export Kirkuk oil, the same way as it exports the region’s crude” from current KRG-administered fields, Dizayee said.

By securing the oil facilities in and around Kirkuk, the Kurds would add almost 9 billion barrels to their own crude reserves. Iraq, excluding such an enlarged Kurdish-controlled region, would be left with reserves of 141 billion barrels, still the world’s fifth-largest.

Market Prices

The KRG has sold one cargo of crude that it sent by pipeline to the Turkish port of Ceyhan on the Mediterranean Sea, Dizayee said. “Oil was sold according to the market prices on the day of loading and was definitely not sold at half price,” he said. The Kurds deposited revenue from the sale at Turkey’s Halkbank, where they also plan to send money from any future sales.

Brent crude for August settlement, a global price benchmark, rose 0.1% to $112.44 a barrel at 7:44 a.m. local time on the London-based ICE Futures Europe exchange today, July 1.

KRG authorities plan to boost daily crude-export capacity from about 120,000 bbl currently to 400,000 bbl by the end of the year, with a possibility of “additional quantities from Kirkuk,” Dizayee said.

Output from the Kirkuk area has dwindled to 30,000 bpd from 650,000 since Iraq’s government shut the country’s export pipeline to Turkey in March because of sabotage, state-run North Oil Co. said in a June 19 statement.

The KRG will pay money owed to oil companies working in the Kurdish region after meeting its own financial requirements, and it plans to seek loans from international banks to help cover public expenses, he said.

Iraq’s central government only allocated enough money to the KRG this year for the Kurdish authorities to pay civil servants’ salaries for the first two months, Dizayee said. “We need approximately $1.2 billion a month for salaries and other operational and investment projects,” he said.

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Tuesday, 15 July 2014

BATS Wireless reports solution driven technology to enhance Broadband FPSO communications

BATS Wireless, reported development of enhanced technology that focuses on solving the connectivity problems that frequently plague the energy market utilizing deep and ultra-deepwater FPSO, FSO and drillships. BATS provides cutting-edge systems that facilitate critical production communications and data capabilities between the assets and key support vessels and structures typically used in offshore deployments.

BATS' industry-leading, proprietary stabilized microwave systems, which can be integrated with almost any radio, are used to form a high-speed, high-capacity network that can offer up to multi-gigabit connectivity speeds. The ruggedized, marine-grade BATS DVM systems deliver a wealth of cutting-edge wireless communications and data opportunities to FPSO operators, enabling end users access to faster, more adaptive communications networks already providing major energy producers for both enhanced production capabilities and increased crew comfort.

The systems feature BATS' innovative connect and track technology, allowing for the dynamic connection and continual movement of high throughput point-to-point (PTP). BATS systems provide links that can automatically adjust for movement, either due to environmental or requirement changes; and provide organizations a stable and secure, high-bandwidth, private FPSO communications and data pipeline either back onshore, with vessels and platforms in field, or both; without the high recurring costs typically associated with competing satellite solutions.

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Sunday, 13 July 2014

EY Reserves Report: More reserves and rebounding profits for U.S. oil and gas

EY’s seventh annual US oil and gas reserves study reveals multiple indicators that the U.S. oil and gas industry is emerging from years of volatility prompted by the global financial crisis and subsequent recession. While there was a slight decrease in capital spending, US oil and gas reserves each increased by 9% in 2013, oil prices remained strong and natural gas prices showed improvement.

The annual study looks at U.S. E&P spending and performance data over the past five years for the largest 50 companies based on end-of-year oil and gas reserve estimates.

“The promising oil and natural gas reserves and profit increases are certainly signs that the industry is enjoying more stability than it has in recent years,” said Deborah Byers, the Oil & Gas Leader for Ernst & Young in the US. “While we saw lower capital expenditure numbers in 2013, that is due in part to the advancement in technologies and processes that are making exploration and production less expensive and more efficient.”

Capital expenditures

Compared to the prior year, total capital expenditures declined 7% in 2013 to $173.5 billion, driven by lower unproved property acquisition costs and lower exploration costs.
Proved reserve acquisition costs increased to $16.88 per boe in 2013 compared to $10.76 per boe in 2012, representing a 57% increase. The largest transactions in 2013 that drove these results were primarily focused on oil reserves.

While exploration costs declined approximately 15% in 2013, the level of spending represented the second highest amount of the five-year study period. Development spending increased every year of the five-year study period and reached $106.7 billion in 2013. All peer groups – independents, large independents and integrated companies – saw an increase in development spending in 2013, but spent less on exploration.

Revenues and profits

An 11% increase in revenues and significant decrease in property impairments fueled a 53% increase in after-tax profits for the study companies in 2013 to $33.4 billion. This was a significant change from the previous year’s study, which showed a 58% decrease in after-tax profits for 2012 – a dip widely attributed to low natural gas prices.

An increase in oil production helped push revenues to $199.0 billion in 2013. This increase was also aided by increased prices as revenues per boe of production rose as well. Production costs increased in 2013 mainly due to higher lease operating expenses, and many companies made strong investments in their 2013 operations with a plowback percentage of 125%.

Oil and gas reserves

Both oil and gas reserves saw improvement in 2013. End-of-year oil reserves increased in each year of the study and reached 25.4 billion barrels in 2013.  After decreasing in 2012 due to downward reserve revisions caused by depressed natural gas prices, end-of-year gas reserves grew to 178.7 Tcf in 2013. While natural gas prices fared slightly better last year, positively impacting gas reserves, gas production dipped slightly for the first time in the study' s five-year period.

Extensions and discoveries for both oil and gas reserves in 2013 were the highest of the five-year study period. These additions for oil reserves encompassed 4.1 billion barrels in 2013 and contributed to an oil production replacement rate of 222%, excluding purchases and sales. Extensions and discoveries of 29.9 Tcf were reported for gas reserves in 2013, and the gas production replacement rate was 229%, excluding purchases and sales.

“Large independents accounted for the largest absolute increases in oil and gas reserves in 2013, though the gas reserves still remain below the level we saw in 2011,” Byers said.

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Friday, 11 July 2014

Libya’s biggest oil port may open in August, rebels say

Libya’s largest oil-export terminal, the port of Es Sider, may re-open in August after the North African nation’s new parliament takes office, said a spokesman of the rebel group that shut the facility almost a year ago.

“It’s possible to solve all issues and get to an agreement to re-open Es Sider and Ras Lanuf when the new parliament starts working, God willing, after Ramadan,” Ali Al-Hassy, a spokesman of the Executive Office for Barqa, said by phone from eastern Libya.

Ras Lanuf is the second of two ports still under control of the Barqa rebels. The Muslim fasting month of Ramadan started today, June 29, in Libya and will finish with the Eid El Fitr holiday at the end of July.

The rebels’ Executive Office for Barqa seeks self-rule for the region known also as Cyrenaica. It occupied oil ports in eastern Libya at the end of last July, demanding an oil-revenue sharing agreement to make up for the neglect the area experienced under Muammar Qaddafi’s 42-year rule.

Libya, with Africa’s largest oil reserves, is now producing about 300,000 bpd, or a fifth of its output before Qaddafi was overthrown in 2011. The loss of the country’s oil production has boosted the price of Brent, a benchmark for half the world’s traded crude.


Under an agreement reached on April 6, the Barqa federalists handed over control of Zueitina and Hariga, two of the four oil ports they seized a year ago. In return, they received an amnesty and the payment of salaries for defectors from Libya’s Petroleum Facilities Guard who joined the rebels.

The accord calls for a second round of talks aiming at a comprehensive deal that would allow the re-opening of the two remaining ports, Es Sider and Ras Lanuf.

The Barqa federalists last month threatened to cancel the April agreement in protest over the appointment as prime minister of Ahmed Maiteg, whom they see as allied with the nation’s Islamists. His appointment was later withdrawn, and elections were held last week for a new parliament.

Danske Bank on June 19 raised its third-quarter forecast for Brent crude to $107 a barrel, from $104, on the turmoil in Iraq and the protests at oil sites in Libya. “We expect the oil price to stay in the $108-114 a barrel range over coming months, as it will take some definitive progress in Iran and Libya for the oil price to break below this range,” it said.

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Wednesday, 9 July 2014

Keystone foes urge top Nebraska court to void pipeline path

Nebraska landowners opposed to the proposed $5.4 billion Keystone XL pipeline urged the state’s highest court to uphold a judge’s ruling invalidating the route mapped by Governor Dave Heineman and TransCanada Corp.

The property owners urged the state Supreme Court to uphold a February ruling effectively blocking the pipeline. Judge Stephanie Stacy in Lincoln declared TransCanada a common carrier like a railroad. As such, a 2012 law giving the governor control over the path violated a part of the state constitution vesting power in the Public Service Commission.

TransCanada “offers pipeline structures for transportation services, like taxis offer rides to passengers for a fee, and truckers offer cartage for dollars per mile,” the landowners said in a June 20 legal brief. “The currently-proposed pipeline is a structure that will transport crude oil for hire.”

TransCanada, based in Calgary, seeks to build a 1,179-mile (1,897-km) conduit capable of carrying 830,000 bopd from Hardisty, Alberta, to Steele City, Nebraska, where it would connect to an existing network.

Supporters say Keystone will create jobs and promote energy independence. Opponents say petroleum derived from Alberta’s oil sands will contribute to global warming.

The decision on whether to approve Keystone will fall to President Barack Obama, who may wait until the Nebraska court rules. The judges have yet to schedule arguments, and a decision may not come until after Congress’s midterm elections.

Energy East

TransCanada has said it will seek Canadian government permission to construct a different, longer, pipeline giving it a conduit to the Atlantic Ocean. That proposed 2,700-mile pipeline, called Energy East, would carry 1.1 MMbopd across six provinces to a refinery and export terminal at Saint John, New Brunswick.

Heineman, a Republican who’s leaving office on Dec. 31, and state Attorney General Jon Bruning, who sought to succeed him, argued in April that the three landowners who sued haven’t shown they’ve been injured by the plan and lack standing to sue.

Bruning last month lost the Republican Party’s gubernatorial primary to former Ameritrade Holding Corp. Vice Chairman Pete Ricketts.

David Domina, the landowners’ lawyer and a Democrat seeking a U.S. Senate seat, said his clients have been harmed.

“There is no competitor, different regulator or differently affected landowner to bring this suit,” he said in a phone interview. “The state belongs to the citizens, and they are its saving watchfulness.”

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Monday, 7 July 2014

Rosneft says Gazprom monopolizing China pipeline would break law

OAO Gazprom’s plan to monopolize a pipeline to be built as part of a $400 billion deal to supply Russian gas to China would be illegal, rival OAO Rosneft said.

While Gazprom is Russia’s pipeline export monopoly, it must allow others access to the network to supply domestic customers in the east of the country, Rosneft said today, July 1, in a statement on its website.

“We will protect the rights of our citizens,” Rosneft said in the statement. “Gazprom, being an infrastructure monopoly, is obliged to guarantee independent producers access to the transport system.”

Gazprom’s press service today referred to comments on the pipeline by CEO Alexey Miller. The company plans to use only its own gas to fill the pipeline and for its contract with China, Miller told journalists that day.

Gazprom and Rosneft are jockeying for position as Russian President Vladimir Putin pivots to China as a buyer of gas to cut reliance on the European Union. The U.S. and EU have threatened to broaden sanctions against Russian companies and officials, saying Putin is supporting separatists in Ukraine. The U.S. blacklisted Rosneft CEO Igor Sechin but not his company.

Gazprom agreed a 30-year natural-gas deal with China overseen by Putin in May after a decade of negotiations. The accord includes plans for the pipeline and will allow the company to invest $55 billion to develop gas fields.

Rosneft, Russia’s largest oil producer, said today it could contribute at least 40 Bcm of gas a year to the pipeline from fields in eastern Siberia, and other producers an equal amount. That’s about the same as Algeria’s 78.6 Bcm of output in 2013, according to BP Plc data.

Rosneft will seek access to the network through corporate negotiations and regulatory authorities, the company said.

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Saturday, 5 July 2014

ConocoPhillips subsidiary wins U.S. Coast Guard maritime award

The U.S. Coast Guard (USCG) has recognized Polar Tankers, Inc., a ConocoPhillips subsidiary, with the Rear Admiral William M. Benkert Osprey Award for Environmental Excellence. Vice Admiral Peter Neffenger, the USCG 29th Vice Commandant, presented the award at the American Petroleum Institute Tanker Conference.
The Benkert awards were created to recognize outstanding achievements in marine environmental protection that go beyond compliance with industry and regulatory standards. A committee reviews and scores award applications submitted biennially by maritime operators. The Osprey-level Benkert award is the highest environmental award given by the USCG.
Polar Tankers is a wholly-owned subsidiary of ConocoPhillips that includes five company-owned, double-hulled tankers, each with a million-barrel capacity and state-of-the-art redundant systems for environmental safety.

The company operates these Endeavour-class tankers in the Trans-Alaskan Pipeline System (TAPS) trade, loading crude oil in the Port of Valdez, Alaska, and delivering to terminals within Puget Sound, Wash.; San Francisco and LA/Long Beach, Calif.; and Hawaii.

Mosdor Global Estates, providing support in the buying and selling of crude oil, other petroleum products. Publishing news and reviews in the oil and gas plus real estate industry online.

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