Royal Dutch Shell Group .com Rotating Header Image

January 2nd, 2007:

TheDailyReckoning.com.au: Shell kicked out of Russia’s Sakhalin II gas project by Gazprom

Posted by Dan Denning on Jan 2nd, 2007

…now that Shell has been kicked out of Russia’s Sakhalin II gas project by Gazprom, how long will it be before the company reignites its pursuit of Woodside Petroleum (ASX: WPL)? Shell’s initial courtship of WPL was shot down by the Treasurer on the grounds that Shell’s interest in the Sakhalin project made it less likely to develop Woodside’s gas assets in the NorthWest Shelf.

Today, we imagine Shell is quite keen to develop anything it can get its hands on, if only to replace current production from its rapidly dwindling reserves. Shell may be forced to cut its proven oil and gas reserves by four percent as a result of losing out on the Russian venture. The company needs new gas assets the way a hobo with delirium tremens needs a drink-which is to say it’s a matter of survival. Woodside has them. Hmmm. How do you think this will end? read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

San Francisco Chronicle: Bribery thrives as big business in Putin’s Russia

Michael Mainville, Chronicle Foreign Service
Tuesday, January 2, 2007

(01-02) 04:00 PST Moscow — Like many Russians, Nikolai can’t even count the number of bribes he has paid in his lifetime.

He remembers the big ones, like the $1,000 he paid to avoid mandatory military service or the $1,200 he gave his wife’s obstetrician to ensure her a place at one of Moscow’s state-run maternity hospitals. But the small ones, like the dozens of $10 to $20 bribes he’s handed to traffic police over the years, are instantly forgotten. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Agence France-Presse: Sakhalin project may lose large backer: Gazprom’s control a worry for bank

LONDON — The European Bank for Reconstruction and Development says it may opt out of the Sakhalin-2 liquefied gas project in Russia now that OAO Gazprom is majority shareholder.

“No decision has been made to date (but) the new developments make things more difficult. They may make the bank less needed for the project,” a spokesman for the London-based EBRD said.

Royal Dutch Shell PLC said on Dec. 21 that Gazprom, the Russian state natural gas giant, would control 50 per cent, plus one, of shares in the Sakhalin-2 project, at a cost of $7.45-billion (U.S.). read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Wall Street Journal: Europe Wary of Sakhalin Loan

Wall Street Journal Chart

By GUY CHAZAN
January 2, 2007; Page A4

MOSCOW — A potential about-face by the former Communist bloc’s biggest single investor over a massive Russian energy project comes amid rising Western concern about increasing state control of that nation’s energy sector.

The European Bank for Reconstruction and Development is likely to abandon a loan to Sakhalin II, the huge energy project in the far east of Russia, after Royal Dutch Shell PLC and its two partners were forced to sell a 50% stake in the venture to Russian natural-gas giant OAO Gazprom. The European development bank — set up in 1991 by Western governments to support the private sector in former Communist states making the transition to a free market economy — had planned to lend Sakhalin II about $300 million. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Wall Street Journal: Belarus Yields to Russia

Deal on Gas Prices
Solidifies Success
Of Kremlin Strategy
By ALAN CULLISON
January 2, 2007; Page A4

MOSCOW — The last-minute deal that sharply raises the price of Russian natural gas to Belarus highlights the success of a Kremlin energy policy that the West has denounced as bordering on blackmail. By showing that it is willing to cut off countries that won’t accept rate increases, Russia has ended an era of cheap energy supplies to former Soviet republics.

Russia’s natural-gas monopoly and its largest company, OAO Gazprom, announced the agreement early yesterday, hours before the company said it would shut down supplies to Belarus. The agreement more than doubles the price of gas to Belarus, to $100 per 1,300 cubic yards from $47. Moscow also said it would acquire a 50% stake in the Belarus gas-transit monopoly, Beltransgaz, an asset Minsk for years has refused to surrender. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Wall Street Journal: FUEL FOR POWER

FUEL FOR POWER: The European Bank for Reconstruction and Development’s likely move to abandon a loan to Sakhalin II after Royal Dutch Shell PLC and its two partners were forced to sell a 50% stake in the huge energy project in Russia’s far east to Russian natural-gas giant OAO Gazprom likely won’t jeopardize the $22 billion project. Furthermore, it likely won’t threaten overall funding for big Russian energy projects, as Western investors remain interested in Russia in general and its vast natural resources in particular. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Daily Telegraph: The Questor column: Salamander Energy

By James Quinn
Last Updated: 1:45am GMT 02/01/2007Page 3 of 3

SMALL but perfectly formed, Salamander Energy is Questor’s way of keeping up with the oil boom.

Rather than opting for one of the ailing and troubled majors such as BP or Shell, what better way to tap in to the gush for energy production stocks than Salamander, which floated quietly on the LSE last month, the first oil-and-gas company to do so for three years.

It is also unusual in being the only UK-listed oil-and-gas company focusing exclusively on south-east Asia. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Lloyds List: Shell leaves it late to declare new Brazilian project

Published: Jan 02, 2007

SHELL has another deepwater oil project in the pipeline off Brazil after declaring the BS-4 oil discoveries a commercial project before the relinquishment deadline, writes Martyn Wingrove.

The Anglo-Dutch oil major will need to lease another floating production storage and offloading vessel and may order a subsea production system to develop the Santos basin heavy oil fields in block BS-4

Shell holds a 40% working interest in the block with state group Petrobras holding another 40% and US major Chevron 20%. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Lloyds List: Venture books Sevan platform for Pilot field

Life of the heavy oil development likely to be five to nine years, writes Martyn Wingrove,
Published: Jan 02, 2007

VENTURE Production is set to develop the Pilot heavy oil field in the North Sea with a Sevan Stabilised Platform after signing a $355m contract with Norwegian company Sevan Marine for a second floating unit.

The Aberdeen independent aims to use an SSP 300 floating production storage and offloading unit to start pumping oil from the Pilot field in block 21’27a in 2009.

Venture has asked Sevan to undertake the engineering and provide the cylindrical-designed FPSO for a test production phase as the first part of the contract. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Lloyds List: Offshore firms in $800m bonanza

Lloyds List
Published: Jan 02, 2007

WITH 2006 ended, offshore contractors are on the receiving end of new awards from oil companies worth more than $800m, writes Martyn Wingrove.

Workers at Saipem, Subsea 7, Technip and Aker Kvaerner are all cheering in the new year on a wave of optimism after these contractors secured more employment in West Africa, Brazil, the Gulf of Mexico and the North Sea.

Taking the lion’s share of the new contracts, Italian contractor Saipem has gained two awards with a combined value of €410m ($540m) in Gabon and Angola that will involve offshore operations in 2008 and 2009. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Lloyds List: Brazil exploration investment pays off with 18 new projects

Published: Jan 02, 2007

OIL companies in Brazil have created 18 new offshore commercial projects from exploration in 2006, writes Martyn Wingrove.

Petrobras said it has determined commercial viability for 16 offshore fields in the Espirito Santo, Campos and Santos basins and Shell declared two new fields in Santos.

Petrobras said it has found around 2.1bn barrels of oil equivalent in the declared commercial areas, including 560m boe in four Santos basin discoveries.

Further work may be required on the Tambuata, Pirapitanga and Carapia fields before they can be developed, but drilling has been successful off the Sao Paulo coast. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Financial Times: Banks pay top dollar to secure commodity talent

By Kevin Morrison,Commodities Correspondent
Published: January 2 2007 02:00 | Last updated: January 2 2007 02:00

Commodity traders, once the overlooked Cinderellas of the financial trading world, are being offered multi-million-pound lock-in payments reminiscent of the early dotcom boom, when banks were desperate to expand into new areas by offering guaranteed payments to key staff.

The value of such traders – and energy traders in particular – has risen sharply over the past 18 months, amid the continuing commodity price boom that has prompted hedge funds and top-tier banks to expand their commodity trading businesses. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

The Financial Times: The real action is in commodity trading

By Kevin Morrison
Published: January 2 2007 02:00 | Last updated: January 2 2007 02:00

In their fierce competition for commodity traders, investment banks are making guaranteed payments ranging from £500,000 a year to more than £10m over three years in an echo of the dotcom boom of the late 1990s.

Three years ago, according to one bulge bracket bank’s head of European commodity sales, his bank was able to hire from Goldman Sachs and Morgan Stanley, which stood out from the bunch by sticking with commodity trading through economic cycles. read more

This website and sisters royaldutchshellplc.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.