Information – Oil Gas Future Energy
Qatar says Opec could cut supply as inventories grow
Qatar says Opec could cut supply as inventories grow Bloomberg Published: January 31, 2008, 01:28
Doha: The Organisation of Petroleum Exporting Countries (Opec) won’t raise output quotas at a meeting this week and will consider a supply reduction in the future because world econ-omic growth is slowing and oil inventories are ample, Qatar’s energy minister said.
“The world has sufficient supply, even oversupplied in some places,” Qatar’s Abdullah Bin Hamad Al Attiyah said yesterday. “So to increase, I don’t think this is on the agenda.”
He said the 13-member producer group, the supplier of more than 40 per cent of the world’s oil, would consider a production cutback “if the world economy moves toward a recession.” Weaker economies may lead to reduced demand for energy, he said.
The Opec is expected to keep its output target unchanged at 29.67 million barrels a day when it meets in Vienna on February 1, according to 29 of 32 analysts surveyed by Bloom-berg News.
UAE Energy Minister Mohammad Bin Dha’en Al Hamili said yesterday he was concerned about the possible knock-on effects of the US mortgage crisis on the world economy and oil markets.
Al Hamili said Opec was monitoring the impact on crude oil demand of a possible slowdown in the global economy and would discuss the matter.
A senior Iranian oil official also made clear yesterday he did not expect Opec to decide to change output levels at the meeting. “Because no special conditions have been created in oil markets, it is unlikely that Opec will make a special decision in its meeting on Friday,” Javad Yarjani, head of Opec affairs at Iran’s oil ministry, said. “Market conditions do not need a new Opec decision.”
Oil prices have tumbled from a record $100.09 a barrel set on January 3 amid signs of an economic slowdown in the US, the world’s biggest energy consumer.
Crude oil for March delivery was up 45 cents at $92.09 a barrel in electronic trading on the New York Mercantile Exchange ay 9.28am London time.
Abu Dhabi to keep March contract volumes steady
Abu Dhabi to keep March contract volumes steady
Reuters Published: January 29, 2008, 23:39
Singapore: Abu Dhabi National Oil Co (Adnoc) has notified at least four Asian lifters that it will supply crude oil at full contracted volumes for March, as it did for February, lifters said yesterday.
Abu Dhabi, the main oil producer the UAE, would also supply limited extra volumes, on top of fully contracted volumes, with three refiners saying they did not request additional volumes for March.
Additional cargo
One lifter said they would receive an additional 500,000-barrel cargo of Murban crude for March, while another declined to comment on whether he had sought additional volumes.
Demand for March Abu Dhabi crude has weakened from February as refiners in North Asia have started cutting runs.
The steady March volumes come as the Organisation of Petroleum Exporting Countries (Opec) is scheduled to meet this week, with members repeatedly saying they are pumping enough oil, signalling that it would maintain output levels despite calls by the United States for more supplies to help ease high prices.
International crude prices have come down from their historic high of over $100 a barrel on worries of a US slowdown.
Spot Abu Dhabi crude fell to its deepest discounts in three months last week, with flasgship Murban crude sold at down to a discount of 25 cents a barrel to Adnoc.
But demand has not collapsed and spot cargoes for March loading have largely cleared by now, traders said, suggesting that refiners saw value in the light sour grades, though at discounts to their official selling prices (OSPs).
Japanese refiners, who are the largest buyers of Abu Dhabi crude, have cut runs for January and February from their initial plans on sluggish domestic demand and falling margins.
Japan’s top refinering company, Nippon Oil Corp, has also said that it will extend and deepen a 30,000 barrels per day (bpd) production curb this month to a 41,000-bpd cut in February.
Four out of five South Korean refiners have also decided to cut crude runs for February, pressured by poor margins and seasonally weak demand, processing at the lowest rate in four months, a Reuters poll of industry sources show-ed.
Opec likely to deny Bush plea for more supply
Opec likely to deny Bush plea for more supply
Bloomberg Published: January 29, 2008, 23:39
London: The Organisation of Petroleum Exporting Countries (Opec), the producer of more than 40 per cent of the world’s oil, may reject US president George W. Bush’s request to increase production and relieve the strain of rising energy costs.
Opec will keep its output target unchanged at 29.67 million barrels a day when it meets in Vienna on February 1, according to 29 of 32 analysts surveyed between January 24 and 28 by Bloomberg News. Ministers from Qatar, the UAE and Iraq said last week that more oil isn’t needed. Bush asked producers to pump more crude during a visit to Saudi Arabia.
Oil fell 5.3 per cent to $90.90 a barrel this month, and the 13-nation group wants to prevent a further decline, the analysts said. A slowdown in the US, the world’s biggest energy consumer, risks curbing demand for fuel as the end of winter in the Northern Hemisphere reduces consumption. “Opec would be shooting themselves in the foot if they increased supply,” Michael Davies, head of research at Sucden (UK) Ltd in London, said.
Recession fears
Goldman Sachs Group Inc. and Merrill Lynch & Co. predict deteriorating growth in the US will spread to other nations. Japan, the world’s third-largest oil consumer, has probably entered a recession already, Goldman’s chief Japan economist, Tetsufumi Yamakawa, said.
The US dollar, used by Opec to price oil sales, weakened 12 per cent against the euro during 2007, eroding Opec’s purchasing power. There’s “no need for additional barrels,” Hossein Kazempour Ardebili, the Opec governor for Iran said.
“There’s a 60 per cent chance they’ll increase production as the US is putting pressure on Saudi Arabia,” Hannes Loacker, an analyst at Raiffeisen Zentralbank Oesterriech in Vienna, said. “If Opec does increase, prices could come down into the $80s.”
“Opec is happy with the price above $80, and they clearly want to stop it going below $80,” said Johannes Benigni, managing director of PVM Oil Associates in Vienna.
Forecast: Output may be cut
Opec may cut its oil output in March if stockpiles increase and demand dwindles, the Wall Street Journal said, citing unidentified ministers and officials.
The 13-member group may have a tough time this year deciding whether to boost or decrease production, the newspaper said. A US recession could curb the growth in global demand, yet China and the Middle East are still using more oil, the Journal said.
Abu Dhabi / ConocoPhillips / Shah project
Abu Dhabi / ConocoPhillips / Shah project
ConocoPhillips is in advanced negotiations with state-owned Abu Dhabi National Oil Co (ADNOC) on the project to develop the sulfurated natural gas from Shah, estimated at USD 10 billion. The news, which was announced by sources close to the talks, is surprising since it was believed that the American group had been eliminated from the talks, like fellow US group ExxonMobil. At the end of 2007, the announcement was made that only Royal Dutch-Shell and Occidental Petroleum were still in the running to participate in the largest non-associated gas development project ever conducted in the emirate.
The reasons why ADNOC has changed its opinion about ConocoPhillips remain uncertain, according to observers. (BIP, The Wall Street Journal Europe)
Crude prices – Who drove the oil price to USD 100/-
Crude prices
An unknown trader by the name of Richard Arens is reportedly the one who drove oil to USD 100. Last Wednesday, as the American barrel was being traded at USD 99.53, this manager from the ABS company purchased 1,000 barrels (the regulatory minimum) from a colleague at USD 100, reports the Financial Times. The barrel price then dropped. With this 1,000 barrels, which changed hands at a price that has been a magic number for a long time, “we truly entered an era of expensive oil,” and “our economies will have to get used to it,” stressed French Economics Minister Christine Lagarde last Thursday. Richard Arens is the man who lit the fuse, but everything was ready for the explosion, reports Les Échos, citing still strong demand, a limited supply, and investors increasingly looking for protection against an economic slowdown by playing with commodities, plus the problems in Nigeria and Pakistan.
In fact, crude prices continued to climb and, for the first time, exceeded the USD 100 mark at USD 100.09 during the session in New York. At 5:30 p.m. GMT, light sweet crude was trading at USD 99.73, up 9 cents from the closing price the day before. There was an identical movement in London, where the price of February Brent also hit a new peak last Thursday, advancing to USD 98.50 a barrel. At 5:30 p.m. GMT, it was trading at USD 97.87, up 3 cents. (AFP, Les Échos)
Reliance seeks 3.6 mmscmd gas from PMT fields
Reliance seeks 3.6 mmscmd gas from PMT fields
January 04, 2008 15:08 IST
Reliance Industries Ltd [Get Quote] has sought a minimum supply of 3.6 million standard cubic meters per day of gas for its petrochemical plants from the Panna/Mukta and Tapti fields, from which gas has been diverted by the government to state-run GAIL India [Get Quote].
Reliance along with state-run Oil and Natural Gas Corporation and BG Group of UK are the operators of the PMT fields lying in Mumbai offshore and till last month marketed gas from the fields in proportion to their shareholding.
The Mukesh Ambani-run firm’s petrochemical plants got 5.2 mmscmd of gas from the PMT fields, RIL President and CEO — Petroleum P M S Prasad wrote to petroleum secretary.
“PMT joint venture currently has commitment to supply around 2 mmscmd to RIL petrochemical plant at Hazira and about 1.9 mmscmd to (its subsidiary) IPCL [Get Quote] plants at Gandhar and Vadodara. IPCL have contract for additional supply of 1.3 mmscmd from PMT gas,” Prasad wrote on December 24.
Oil ministry last month cancelled almost all contracts for sale of gas from PMT fields and diverted it to GAIL India Ltd for re-sale at higher price.
GAIL is to finalise sale contracts in line with the gas utilisation policy that priorities allocation to fertiliser, petrochemical, existing power plants and city gas distribution units in that order.
Reliance, he said, was in favour of gas being given to priority sectors and was willing to use a mix of alternate fuels and gas at its petrochemical plants.
Adnoc vows to protect environment
Adnoc vows to protect environment
posted on 31/12/2007
The Abu Dhabi National Oil Company (Adnoc) has pledged to protect the environment by putting in place internal standards that push the company to decrease its impact on the earth. The government-controlled company, one of the largest oil producers in the world, made the commitment at the Arab Corporate Environmental Responsibility Summit organised by the Abu Dhabi Environment Agency and other local and international organisations.
“Adnoc and its group of companies are fully committed to environmental protection through a set of laws, corporate policies and codes of conduct,” said Ali Rashid Al Jarwan, general manager, ADMA-OPCO. He said leadership, commitment, policies, laws, management systems and corporate social responsibility form a strong bond that helps the group to shoulder its environmental responsibility. “We use the latest environmental management systems to ensure continuous improvement,” he said, adding that one of the major achievements of the group is the success made towards achieving a zero-flaring goal through upgrading facilities.
Meanwhile, the Abu Dhabi Environment Agency has urged all businesses in the emirate to live up to their promises concerning the environment and to take preventative measures to protect the earth. The agency said the Arab Environment Ministers Council has approved last month’s Abu Dhabi Declaration on Corporate Responsibility and Cleaner Production, which called for the private sector to support environmental protection efforts.
More than 120 chief executives, representing major business sectors from the Arab world, attended the summit and made commitments to take responsibility for the environmental costs associated with their businesses and to work towards green alternatives. “The protection of the environment is the responsibility of all business sectors. They have to contribute to environmental protection efforts and need to invest towards this,” Majid Al Mansouri, secretary-general of the Environment Agency, told Emirates Business.
In order to achieve this goal, he said, the agency is working with different sectors to implement an Environment, Health and Safety policy and the Environment, Health and Safety Management System at the emirate level so that sustainable development is integrated into every step of corporate strategies. “Financial achievement should not be the only goal of companies. Their corporate responsibilities should include environmental protection and social development. The environment, health and safety management must be considered in any new project,” Al Mansouri said. (Emirates Business 24|7)
IPIC awards 460 million dollars contract
IPIC awards 460 million dollars contract
posted on 02/01/2008 – Emirates News Agency, WAM
International Investment Company IPIC said Monday it awarded contracts worth 460 million dollars to three companies to supply pipes for a domestic crude oil export pipeline linking Abu Dhabi and Fujairah. IPIC, an Abu Dhabi government investment firm, split the contract for a total of 225 thousand tons of coated steel pipes between Sumitomo of Japan, Salzgitter Mannesmann International of Germany and Jindal Group of India. First delivery of the pipe will be in July 2008 and the whole deal will be completed in January 2009. Abu Dhabi plans to build the 360-kilomter pipeline to transport up to 1.5 million barrels a day from Habshan oil fields to Fujairah to bypass the Strait of Hormuz through which Arabian Gulf producers’ ship crude oil exports.
India’s November oil product sales up 5.5 pct
India’s November oil product sales up 5.5 pct
28 Dec, 2007, 1327 hrs IST, REUTERS
NEW DELHI: India’s domestic oil product sales in November rose 5.5 percent from a year earlier to 10.6 million tonnes, official data showed on Friday. Domestic diesel sales were up 10.3 percent to 4.1 million tonnes from a year earlier, the data showed.
OVL hits oil in Najwat block off Qatar shores
OVL hits oil in Najwat block off Qatar shores
28 Dec, 2007, 0448 hrs IST,Rajeev Jayaswal, TNN
NEW DELHI: ONGC Videsh Ltd (OVL) has struck black gold in Arabian Gulf block off Qatar. The Najwat Najem block is the first overseas project executed by OVL wherein the company has both 100% ownership and is the sole operator.
“As per preliminary indications, oil has been encountered in the Shuaiba and Arab formations. The second well will also be completed by January 2008. We are hopeful that this will lead to the development stage,” a source in the petroleum ministry said.
The exact size of the discovery is not known yet as it has not been formally approved. OVL spudded its first appraisal well in the Najwat Najem structure on July 6, 2007. OVL had firmed up two locations for evaluating the structure and assessing and proving its commerciality.
OVL signed an appraisal, development and production sharing agreement (ADPSA) with the Qatari government on March 2, 2005 for the Najwat Najem oil structure appraisal in the country as an operator. The agreement came into effect on May 19, 2005 with the signing of the Emiree Decree (termed the effective date).
ADPSA is for a period of 20 years from the date of the Emiree Decree and comprises of an initial two year appraisal phase followed by a development phase. The minimum work committed during the appraisal phase is reprocessing and interpretation of 200 sq km of seismic data, a preliminary G&G study, drilling of two appraisal wells and an integrated multi-disciplinary study to assess the potential of the area.
The Najwat Najem oil structure is located in the Arabian Gulf in offshore Qatar at a distance of about 100 km north east of Doha Port. It lies at a distance of about 18 km off the Halul island in the state of Qatar. The Jurassic lime stones are the main reservoirs of this structure.
The Najwat Najem oil structure is in the Persian Gulf, at a water depth of approximately 135 feet.
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