Posts on ‘August 11th, 2006’

After suffering in recent years from one mishap after another, Anglo-Dutch oil major Royal Dutch Shell has overtaken its cross-London rival BP PLC as Europe’s biggest oil company. Shell boasted a market capitalization of 128.33 billion pounds ($244.61 billion) at Wednesday’s close in London, based on the number of shares in issue at the end of June. BP, meanwhile, ended the day with a market value of 123.96 billion pounds ($236.28 billion).

The turnabout comes as BP has eclipsed Shell as Big Oil’s bad boy. Until recently, BP and Chief Executive John Browne were vaunted as exemplars of good management. But the company has smarted from a string of operational disasters in North America. read more

BEIJING, Aug. 11 (Xinhuanet) — BP Plc may continue to pump oil from the western part of its Prudhoe Bay field in Alaska, though the Oil giant must conduct more rigorous tests of its pipelines, the U.S. Department of Transportation (DOT) said on Thursday.

A formal order issued late on Thursday by the U.S. Department of Transportation’s Pipeline Hazardous Materials Safety Administration (PHMSA) said that BP’s western line would be allowed to continue operating.

However, BP must conduct four daily surveys of all its low-pressure feeder lines at Prudhoe Bay using heat-seeking equipment to spot leaks and conducting visual surveys of the whole 22-mile transit line network, according to the DOT order. read more

Aug 10th 2006
From The Economist print edition

Sluggish behemoths control virtually all the world’s oil; they should be privatised

WHEN activists, journalists and others speak of “Big Oil”, you know exactly what they mean: companies such as Exxon Mobil, Chevron, BP and Royal Dutch Shell.

These titans have been making lots of money for their shareholders; their bosses enjoy vast pay packets; and their actions affect us all. BP’s decision to shut down Prudhoe Bay, America’s biggest oilfield, to repair leaking pipes is a case in point, outraging many and pushing petrol prices even higher. read more

By MADLEN READ, The Associated Press
Published: Friday, Aug. 11, 2006

NEW YORK – Crude oil prices fell more than $2 a barrel Thursday as thwarted airplane attacks led many carriers to cancel flights, which could mean dampened jet fuel demand and weaker consumer confidence.

Prices also deflated after Shell announced it was bringing back 180,000 barrels of daily oil production in Nigeria. Goldman Sachs, meanwhile, said it would end its participation in the New York Harbor unleaded gasoline contract, as expected, but wouldn’t roll its money into another contract. read more

Fri Aug 11, 2006 11:27 AM GMT

LONDON (Reuters) – Royal Dutch Shell said on Thursday it had repaired a pipeline in Nigeria shut since last month, allowing 180,000 barrels per day of shut Bonny Light oil production to start to resume.

“The pipeline is now in use,” Shell spokeswoman Caroline Wittgen said. “Eight of the nine flow stations shut in as a result of the leak have been reopened.”

The eight flow stations, which account for 173,000 bpd, are ramping up production, she said. read more

Preliminary report slams pipeline construction by project operator

By Upstream staff

Russia’s Natural Resources Ministry has lambasted the Shell-led Sakhalin 2 project after releasing a preliminary report from an investigation into the project.

Deputy Minister Oleg Mitvol said last week that the ministry is planning to file a court appeal in a bid to revoke the 2003 governmental approval of the project, which aims to develop the Lunskoye and Piltun-Astokhskoye fields near Sakhalin island off Russia’s far east. read more

By Upstream staff

An LNG themed float produced by Brunei LNG came first in a special procession last Saturday during continued celebrations for the Sultan of Brunei’s 60th birthday.

Private companies and public departments took part in the procession, and prizes were presented by His Majesty the Sultan himself.

Second place went to the combined team of Brunei Shell Petroleum, Brunei Shell Tanker and Brunei Shell Marketing.

The Sultan celebrated his birthday with a lavish banquet attended by 10,000 guests last month. read more

By Upstream staff

Shell has brought on stream its E8 gas field, which forms part of its 5.3 billion ringgit ($1.45 billion) E11 gas hub project off Sarawak, East Malaysia.

Gas from E8 is processed at the E11 facilities and delivered by pipeline to the Petronas liquefied natural gas complex at Bintulu, Sarawak.

The E13 East and West satellites will be exploited via the E11 hub, which will be able to produce up to 1.2 billion cubic feet per day of gas, during the next three years.

By Upstream staff

Nexen plans to drill three or four more wells in the Gulf of Mexico this year, including the Shell-operated Vicksburg deep-water gas prospect, writes Anthony Guegel.

Located in the eastern Gulf along the regulatory boundary between De Soto Canyon and Mississippi Canyon, Vicksburg carries a pre-drill resource estimate ranging from 30 million to 300 million barrels of oil equivalent.

However, Nexen believes Vicksburg may be on trend with Shell’s Shiloh gas find in De Soto Canyon Block 269. read more

By Upstream staff

New Delhi gas major in talks to come onboard import project

New Delhi-based gas major Gail is in advanced talks with Shell to acquire a significant stake in the Anglo-Dutch supermajor’s Hazira liquefied natural gas import and regasification project in western India.

Industry sources in Mumbai claimed that the talks have the full backing of the Indian government, which controls Gail and wants the company to continue to play a flagship role in the nation’s gas distribution business. read more

By Upstream staff

Government to throw open its dealings for public scrutiny

Nigerian lawmakers aim to launch a far-reaching audit of the nation’s upstream oil and gas industry next month, scrutinising all major government trans-actions and holding ongoing field development and gas monetisation schemes up for public scrutiny.

If approved, the initiative may cause disquiet among players in the country’s oilpatch, including Shell, already under pressure from the National Assembly over cost over-runs on its deep-water Bonga field. read more

By Upstream staff

Approval to halt price-linked tax break for Gulf of Mexico players

The US Senate has approved an amendment to the Defense Appropriations Bill that would end royalty relief for companies producing in the Gulf of Mexico when oil and gas prices exceed certain levels.

The amendment, penned by Republican Senator Jon Kyl of Arizona, was offered in response to a clerical error that has allowed certain leases from the late 1990s to gain royalty holidays outside set pricing thresholds.

“It is completely unnecessary to continue granting this exemption to the oil industry when gasoline and natural gas prices have skyrocketed and oil companies are earning record profits,” said Kyl. read more

EXTRACT: Adding to the drag on oil prices, Royal Dutch Shell PLC said a Nigerian pipeline where a leak had caused it to declare force majeure on 180,000 barrels a day of output was back in use.

THE ARTICLE

By MATT CHAMBERS
August 11, 2006; Page C3

Crude-oil futures slid 3.1% as traders bet that foiled terror attacks planned on planes between the United Kingdom and the U.S. will damp tourism and cut jet-fuel demand.

Clocking up the biggest decline for the front-month contract in nearly three months, prices were further weighed down by an 8.4% plunge in gasoline futures and the restarting of oil flow at a Nigerian pipeline that can carry 180,000 barrels a day of oil. Traders and analysts said the fall in crude prices was exaggerated by speculators cashing in gains made on rising prices last week and Monday.
 
The front-month September light, sweet crude contract on the New York Mercantile Exchange fell $2.35 to $74 a barrel. Brent crude on London’s ICE futures exchange fell $2 to $75.28 a barrel. read more

EXTRACT: A division of Royal Dutch Shell PLC is credited with inventing the technology, which was licensed to Tuboscope Inc., an early maker of smart pigs.

THE ARTICLE

By ANNA RAFF
August 11, 2006; Page A2

If there is one lesson BP PLC should take away from the Prudhoe Bay debacle, it is this: Never doubt the “smart pig.”

The so-called smart pig has taken center stage as the energy company, based in London and the operator of Prudhoe Bay, grapples with oil-pipeline corrosion that forced it to begin a shutdown of the huge Alaska deposit, the largest-producing oil field in the U.S. read more

THE WALL STREET JOURNAL ONLINE

Oil futures fell sharply, losing more than $2 a barrel on the New York Mercantile Exchange, on worries that news of a foiled terrorist plot targeting major airlines could slow air travel, hurting demand for jet fuel. Here’s Thursday’s roundup of energy-related news:

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ENDLESS SUMMER: Europe’s punishing drought has forced nuclear and hydroelectric power plants to limit their water usage, increasing reliance on fossil fuels and pushing energy prices higher, the Financial Times reports. Some climate scientists say such miserable summers will become the norm within 50 years. read more

By REUTERS
Published: August 11, 2006
Filed at 0:12 a.m. ET

SINGAPORE (Reuters) – Oil prices edged up on Friday as geopolitical unease and uncertainty over output from North America’s biggest oilfield checked a 3 percent tumble triggered by a thwarted transatlantic aircraft bomb plot.

U.S. light, sweet crude oil (CLc1) drifted 39 cents higher to $74.39 by 0407 GMT, reversing a $2.35 slump a day ago as traders worried that travelers might shun air travel and oil consumption could fall due to the planned attacks, which officials said were stopped just days before being carried out. read more

Last Update: 5:18 PM ET Aug 10, 2006

LONDON (MarketWatch) — Oil has started flowing again through a Nigerian pipeline that carries Bonny Light crude produced in a joint venture by Royal Dutch Shell PLC (RDSA), Nigerian oil sources said Thursday.

Shell declared force majeure on 180,000 barrels a day of oil output late July following an unexplained leak at the pipeline.

A spokeswoman for Shell in London also confirmed the pipeline was back in use Thursday. “A temporary measure is in place and this means that oil has started flowing again,” a source with state-run Nigerian National Petroleum Corp., told Dow Jones Newswires. read more