February 3rd, 2007:

By Sylvia Pfeifer,
Last Updated: 11:54pm GMT 03/02/2007

The cost of building and developing offshore oil and gas projects has risen by more than 50 per cent over the past few years, one of the world’s leading energy consultancies has warned. The huge surge in cost has been overshadowed by the record profits the oil majors have generated in recent years.

Last week, ExxonMobil, the world’s largest publicly traded oil company, reported profits of $39.5bn (£20bn). Royal Dutch Shell, the Anglo-Dutch oil group, saw earnings rise by an underlying 25 per cent to $25.4bn, the largest profit recorded by a UK-listed company. The biggest driver behind these profits has been the high price of crude which has tripled in the past five years. read more

Click here to see how they match up…

http://www.shellnews.net/blog/jeroen-van-der-veer-dotcom-home-page.htm

Published: Feb 03, 2007 

Most of the world’s leading oil companies were founded on an oil gusher; Royal Dutch Shell started with a ship. Marcus Samuel, a London trader, built the Murex, the world’s first oil tanker, to ferry Caspian oil to Europe, breaking John D Rockefeller’s stranglehold on the oil market. More than a century later, Shell’s heart is still in trading and refining, while finding oil and gas has never been more of a struggle. 

The oil conglomerate was forced to restate reserves in 2004, after it was found they had been over-reported for several years. The clock has been ticking loudly since: Shell wrote down a third of its oil and gas reserves, leaving it with 11.5bn barrels of proven oil and gas reserves, enough to last just over nine years at present production levels. On average, its peers have enough reserves to last between 12 and 14 years.  read more

THE ASSOCIATED PRESS

OLYMPIA, Wash. — The Shell Puget Sound Refinery near Anacortes has been ordered by the state Department of Ecology to inspect all transfer lines and related equipment after a series of spills.

The order was issued Tuesday and requires Shell to report back to the agency on a quarterly basis through 2009 and detail how and when it plans to fix any problems.

Shell Oil Co. has 30 days to appeal Ecology’s order.

The company uses 3-mile-long oil transfer lines that run between its tanks and the dock where oil is transferred to and from oil tankers and fuel barges. About two miles of the lines run above marine waters along the causeway and the fueling dock area. read more

By Gargi Chakrabarty
February 3, 2007

Energy behemoth Shell’s interest in Colorado’s vast stock of oil shale is not just a passing whim.

John Hofmeister, Shell Oil’s president, met with Gov. Bill Ritter on Thursday to discuss the unconventional source of oil. That comes on the heels of hiring former U.S. Interior Secretary Gale Norton as a general counsel for Shell Exploration and Production, Unconventional Resources – Shell’s local arm that is testing a proprietary oil shale technology. read more

LONDON
03-Feb-07

ROYAL Dutch Shell Plc is shifting the focus of its refining operations toward Asia and toward larger facilities, moves which may lead the oil major to sell more refineries, top executives said. “In the downstream business, we move from west to east in the world,” Chief Executive Jeroen van der Veer told a news conference.

“Why? Quite simple, because the growth is there.”

Refining boss Rob Routs said that in addition to recently announced divestment plans, Shell may sell more facilities. “We have a substantial amount of assets that we actually want to get out of,” Routs said. read more

By Sam Fleming,

Royal Dutch Shell laid claim to the title of big oil’s comeback kid with the biggest profit in British history, but its golden era is likely to be all too brief.

The shares rose 32p to 1,746p on the back of a 12pc jump in annual profit to GBP13bn.

But the bumper numbers were overshadowed after chief executive Jeroen van der Veer slashed production targets because of setbacks in Russia and Nigeria.

Further clouding the outlook, questions re-emerged over the rate at which Shell is replacing the oil it pumps from the ground. read more

Alex Brummer, Daily Mail – London: KRTBN

With the assistance of a firm oil price Shell has restored itself to second place in the rankings of global oil with a handsome profits haul of GBP13bn for the last year.

But it has bigger geopolitical difficulties on the horizon as it seeks to restore its reserves.

The easy bit over the last year was winning the approval of the authorities to include in its replacement reserves the Pearl project in Qatar to convert natural gas to road fuel.

It has had to acknowledge that, as a result of its difficulty with Russia, reserves there will be far less than formerly projected. read more

NICK FLETCHER [email protected],
Published: Feb 03, 2007

EXTRACT: After Thursday’s positive performance in the wake of its results, Royal Dutch Shell came back to earth. Its B shares fell 32p to pounds 17.07 as JP Morgan cut its recommendation from overweight to neutral and Investec advised clients to hold, saying the company still faced a number of challenges, including modest production growth until 2010.

Lorna Siggins, Marine Correspondent
Published: Feb 03, 2007

Mayo County Council says that it is committed to implementing recommendations made by Government mediator Peter Cassells on the Corrib gas project in spite of its failure this week to strengthen community representation on a local monitoring group.

A meeting hosted by the local authority and the Department of Communications, Marine and Natural Resources in Glenamoy to elect new community representatives ended in disarray, amid heated criticism of the procedures adopted. read more

By Robert Orr and Neil Hume

Published: February 3 2007 02:00 | Last updated: February 3 2007 02:00

EXTRACT: Of the fallers, a flurry of downgrades dragged Royal Dutch Shell 1.8 per cent lower to £17.07 as this week’s news of record profit was overshadowed by fears of rising capital expenditure and modest production growth.

By THE ASSOCIATED PRESS
Published: February 3, 2007
Filed at 12:10 a.m. ET

LA PAZ, Bolivia (AP) — Protesters forced the shutdown of a natural gas pipeline serving several of Bolivia’s largest cities to demand that President Evo Morales broaden his petroleum nationalization and expand state energy company operations in southern Bolivia.

Vice President Alvaro Garcia confirmed that protesters on Friday had taken control of a pumping plant outside the city of Camiri, 320 miles southeast of the capital of La Paz, forcing employees of pipeline operator Transredes to shut off the flow of gas. read more

(France’s Christophe de Margerie
says he goes where the oil is.)

French Under Fire
For Iran, Iraq Deals;
Oil Spill Riles Sailors
By DAVID GAUTHIER-VILLARS
February 3, 2007; Page B1

Paris

In 1995, the giant French oil company Total SA ignored U.S. calls to boycott Iran, and instead drilled there — planting the French flag in one of the world’s largest pools of oil and natural gas. The man in charge of the project: Christophe de Margerie.

Today, the 55-year-old executive, known as “Big Moustache” for his bushy handlebar, is set to take the helm of Total, the world’s fourth-largest oil company by market value.
 
Mr. de Margerie is scheduled to take over Total on Feb. 14 with several controversies still looming large. He expresses a continuing desire to do energy deals with Iran, even as concern about its nuclear ambitions grows. A French judge is investigating whether Total paid bribes to obtain past Iranian oil deals. And Mr. de Margerie is himself under investigation as part of a French probe into the Iraq oil-for-food scandal — the ill-starred United Nations program designed to let Iraq under Saddam Hussein raise money to feed its people. read more

In October 2006, we visited Mark Garavan, spokesperson for the Shell to Sea campaign, at his home near Castlebar in County Mayo, Ireland.

For over six years Shell to Sea have been objecting to plans for a gas refinery and its associated pipeline in Bellanaboy, the town land designated as the location for the refinery. The Shell to Sea campaign believes the refinery should be sited at sea for health and safety reasons, which is ordinary practice in many parts of the world and because of the devastating impact the refinery will have on the area if it is built. They have also pointed to the financial and economic deficits in the arrangements made between the Irish government and the exploration companies Shell (Dutch), Statoil (Norwegian) and Marathon (UK) and the anomalies they perceive in the way the project has been given approval to proceed. The processes by which permissions have been given to the exploration companies have also been a serious cause for concern amongst local people – with many questions outstanding on planning, health and safety issues in particular. read more

Vol. 12, No. 5  Week of February 04, 2007
Gary Park

Shell Canada is apparently not going to be distracted from taking care of business by uncertainty over its future.

Despite being in the thick of a tug-of-war between Royal Dutch Shell and unhappy minority shareholders over control of Shell Canada, the Canadian subsidiary is pushing ahead with the most ambitious oil sands expansion yet.

A public disclosure document set a new long-term goal for Shell Canada of producing 770,000 barrels per day of bitumen from its Athabasca mining projects — up from its current production of 155,000 bpd and its previous long-term goal of about 550,000 bpd. read more

Vol. 12, No. 5  Week of February 04, 2007
Alan Bailey

Company’s MMS exploration plan targets 2 Camden Bay prospects, August drilling

Shell Offshore Inc. has filed with the U.S. Minerals Management Service the company’s exploration plan for oil and gas leases in the eastern part of the U.S. Beaufort Sea outer continental shelf. The plan proposes the drilling of 18 exploration wells between 2007 and 2012 in the Camden Bay area, offshore the eastern end of the North Slope and the Arctic National Wildlife Refuge. Of those wells, 13 would target the Sivulliq prospect while five would target the Olympia prospect. read more

Crude-oil futures ended the week with a gain of more than 6% as expectations that a cold snap in the northeastern U.S. will continue into February, political tension in key oil-producing countries and prospects for further energy-demand growth lifted prices past $59 a barrel.

Here is Friday’s roundup of oil and energy news:

* * *
STILL NOT A BAD YEAR: Big Oil wrapped up its earnings season with a batch of quarterly declines, but still managed to dust off a late downturn in commodity prices to book some of the largest annual profits in U.S. history. The nation’s three biggest oil companies, Exxon Mobil, Chevron and ConocoPhillips, together churned a fourth-quarter profit of $72 billion on revenue of $771 billion. But there were ample signs that the industry is unlikely to follow up 2006 with yet another round of record-breaking numbers as it struggles to rein in costs and produce more oil in a tougher and lower price environment. read more