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THE WALL STREET JOURNAL: Oil-News Roundup 23 May 2006

Oil News Roundup

May 23, 2006Crude-oil futures fluctuated dramatically on the New York Mercantile Exchange, first falling sharply and then ending the day nearly $1 higher at more than $69 a barrel after Venezuela said it would push OPEC next week to cut oil production. Here is today’s roundup of news about oil and energy.

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GOUGERS, BUT NOT LAWBREAKERS: The Federal Trade Commission said it had found 15 cases of gasoline-price gouging in the wake of Hurricanes Katrina and Rita last year. But it also said that none of those episodes were illegal. Rather, they merely matched the FTC’s definition of gouging, as ordered by Congress: any instance in which the average gas price in a state or national disaster area — or in any other area where consumers had filed gouging complaints — was higher in September 2005 than the average price in that same area in August 2005. The FTC found that 15 firms — seven refiners, two wholesalers and six retailers — fit that description. But the agency said it had found no illegal market manipulation.

Shell to Buy Cnooc Refinery Stake: Royal Dutch Shell PLC is in talks to buy a stake in a 16.7 billion yuan ($2.08 billion) refinery owned by China National Offshore Oil Corp. in the southern Guangdong province in China, part of its effort to boost its presence in China’s petrochemicals sector.

Mars Platform Resumes Production: Shell Exploration & Production said it had resumed some oil and natural gas production at its hurricane-damaged Mars production platform in the Gulf of Mexico. Shell said full production should be restored to pre-Katrina rates by the end of June. Mars was the biggest platform damaged by Katrina, representing about 5% of the Gulf’s daily oil and gas production.

Shell Misses Payment: Shell also said it would not pay $1.5 billion in compensation for alleged Niger Delta pollution on its court-ordered due date, choosing instead to wait for an appeals-court ruling.

Powering Up: Wind-generated power in the European Union is already approaching levels targeted for 2010, the EU’s Eurostat agency said. Wind-power capacity in the EU has jumped more than 150% since 2000.

Winning Bids: France’s Total SA and Brazil’s Petrobras won contracts to lead the exploration of two offshore oil fields in Angola. The biggest stakes will be held by SSI, a joint venture between Angolan state oil company Sonangol and China Petroleum & Chemical Corp., or Sinopec.

Dynegy to Sell Plant: Power producer Dynegy Inc. said it will sell a plant in North Carolina to Duke Energy Corp. for $195 million and plans to offer about 35 million shares of common stock to the public.

Venezuela Backs Property Seizure: Venezuela backed Ecuador’s decision to seize oil facilities from Occidental Petroleum Corp. but said it had no plans to step in and fill the void left by the U.S.-based firm.

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