Asia oil prices steady around $122 a barrel
Oil prices held steady Wednesday in Asia near $122 a barrel after sliding overnight on expectations that this year’s surge in energy costs is undermining U.S. gasoline demand sent crude.
Investors expect more evidence of falling gasoline consumption when the U.S. Energy Department’s Energy Information Administration releases its weekly oil inventory report later Wednesday, said Mark Pervan, a senior commodities strategist with ANZ Bank in Melbourne.
“People are looking closely at the deteriorating demand for petrol,” Pervan said. “The market will probably fence-sit … ahead of the DOE numbers.”
Gasoline stocks were expected to rise 400,000 barrels in the petroleum supply report, according to the average of analysts’ estimates in a survey by energy research firm Platts. The survey also showed that analysts projected crude oil inventories to fall 1.3 million barrels.
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Gas Pipeline in Russia-Europe to cost $20B: Ministry
The South Stream gas pipeline, planned to link Siberian gas fields to Europe by 2013, will cost about $20 billion (12.8 billion
euros), Russia’s energy ministry said on Wednesday.
‘South Stream is a… giant project, whose cost is estimated at $20 billion,’ Energy Minister Sergei Shmatko told Italian Economy Minister Claudio Scajola during talks in Moscow this week, the ministry’s press office said.
Russian gas giant Gazprom is in charge of the project, with Italian energy major ENI as a junior partner. Read more
Singapore Keppel, Second-quarter Profit 12.6Pct some periode
Singapore’s Keppel Land, the country’s third-biggest property developer, said Wednesday its second-quarter profit fell 12.6 percent from the same period a year earlier as revenue from property trading and investment fell on slumping prices.
Keppel, the world’s largest builder of offshore oil rigs in terms of output, reported net earnings of 52.7 million Singapore dollars ($38.5 million) for the three months ended June 30, compared with S$63 million ($44.1 million) a year earlier.
Revenue was down 48 percent to S$186 million ($136 million) from S$359 million ($262 million) in the second quarter of 2007 as several large projects were completed, the company said. Read more
Petrobras, Brazilian Oil Company Opens a Biodiesel Factory In Northeas
Brazilian oil company Petrobras Tuesday opened a biodiesel factory in the northeast of Brazil, following an investment of 100 million reais, officials said.
The unit, located in Candeias, in the state of Bahia, is part of a project of the state biodiesel production company, which includes overall investment of 2.375 billion reais by 2012.
The new factory is able to operate using raw materials of vegetable (sunflower, soy and cotton), animal (beef, pig or chicken render) origin or waste oil and fats used for frying food.
After attending the opening, Brazil’s president, Luiz Inácio Lula da Silva, instated the board of recently created renewable energy company, Petrobras Biocombustível.
The new subsidiary will be responsible for managing the Candeias unit and two other biodiesel factories to be built in the states of Minas Gerais and Ceará. Read more
NZOG Revenue Rises up $4.2M
New Zealand Oil and Gas (NZOG) is reporting full year revenue of $234.6 million, up from $4.2 million the year before due to earnings from the Tui area oilfields off the Taranaki coast.
The company has a 12.5 percent holding in Tui, from which its revenue for the year to the end of June was $222.8m .
There was also a gain recognised form the successful float of Pike River Coal and some other small non-Tui revenue items.
Tui began production almost exactly a year ago, on July 30, 2007, and so far had produced more than 15.2 million barrels of oil, NZOG said.
Tui’s initial proven and probable reserves were upgraded twice during the June quarter; first to 47 million barrels and then to 50.1 million barrels.
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Chesapeake CEO Offers Natural Gas As Answer To US Energy Woes
WASHINGTON -(Dow Jones via CNNMoney)- The chief executive of natural gas producer Chesapeake Energy Corp. (CHK) on Wednesday tried to broaden the market for natural gas by appealing to political concern over the U.S.’s energy crisis, telling Congress that the fuel can provide a solution to both high gasoline prices and climate change.
Hours after presiding over the release of a new report showing that the U.S. has enough natural gas supplies to meet more than 100 years of demand at current levels, Chesapeake Energy Chief Executive Aubrey McClendon told a U.S. House committee that the country could build more natural gas vehicles and gas-fired power plants without raising prices for fertilizer, chemicals and other products that are made with natural gas.
“Three years ago I would have said no,” McClendon told Rep. Ed Markey, D- Mass., chairman of the Select Committee on Energy Independence and Global Warming. Markey had asked whether natural gas supplies were enough to reduce the nation’s reliance on coal-fired plants to about 35% of electricity from 50% currently, without raising natural gas prices. “Today, I say yes,” said McClendon.
The pitch comes amid skepticism from companies that use natural gas and regulators who are currently focused more on high natural gas prices. This summer, regulators warned that high natural gas prices will mean higher summer electricity bills. Dow Chemical Co. (DOW), a major chemical maker, told Congress on Wednesday that it was wary of government policies that might increase demand for natural gas, saying that the U.S. may not be able to handle higher demand for natural gas without putting further strains on manufacturing, a heavy user of the fuel.
“We are concerned that adding new uses for natural gas such as in transportation will create new and relatively inelastic demand that we may not be able to meet without high prices,” Rich Wells, a Dow Chemical vice president, said in prepared testimony.
Recent discoveries in northern Louisiana and Texas, along with discoveries in an area that stretches from western New York to Virginia, are changing that, the industry argues. A new report financed by The American Clean Skies Foundation - a group started and now chaired by McClendon - on Wednesday said that the country has more natural gas than previously thought. U.S. reserves total some 2,247 trillion cubic feet, according to the study by Navigant Consulting Inc. The country consumed more than 20 trillion cubic feet of gas last year.
McClendon had been invited to Capitol Hill to talk about natural gas vehicles as Democrats explore ways to reduce oil consumption, which in spite of recent price declines is up more than 20% so far this year.
Democrats also are seeking to lower greenhouse-gas emissions, giving the natural gas executive a chance to make a push for even broader use of the fuel. Cars that run on compressed natural gas generate 25% fewer carbon-dioxide emissions than cars that run on conventional gasoline, according to the U.S. Environmental Protection Agency. Natural gas fired plants emit about half as much carbon-dioxide as coal-fired plants.
“What these guys have to fully grasp is that all the things they’d like to do - deemphasize coal, deemphasize foreign oil - it’s all built on one hope which our industry is delivering today, which is more natural gas year after year after year,” McClendon told a reporter during a break in the hearing. “I know these shales are so prolific that we can deliver on the promise of natural gas.”
He was referring to fields known as the Haynesville Shale, the Marcellus Shale and the Barnett Shale. A relatively new technique known as horizontal drilling that allows access to gas embedded in the shale - or rock layers - has led companies to buy up mineral rights. Chesapeake Energy alone has estimated that its reserves in the Haynesville Shale total about 44 trillion cubic feet, almost twice the amount the U.S. consumed last year.
McClendon’s message that natural gas is cleaner than other fuels, such as coal, is familiar to state and local officials. In Texas two years ago, he funded a group called the Clean Sky Coalition that ultimately helped fight plans by Texas power company TXU Corp. to build 11 new coal-fired power plants. The company ultimately canceled most of those plants.
Although McClendon has softened his tactics, his opinion remains unchanged, and no less of a threat to the coal industry. On Wednesday, the National Mining Association, which represents coal interests, put a fine point on it, noting that natural gas power plants still emit their share of carbon dioxide. “You can’t get to the CO2 reductions Markey and others want and still use natural gas,” said Carol Raulston, a spokeswoman for the group. She said that is why developing technology to inject carbon-dioxide emissions underground is “so important.”
-By Siobhan Hughes, Dow Jones Newswires; 202-862-6654; Siobhan.Hughes@ dowjones.com
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(END) Dow Jones Newswires
07-30-08 1658ET
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Start Exploration in Chile by Greymouth Petroleum
The Greymouth Petroleum to start exploration in Chile
New Zealand oil explorer Greymouth Petroleum and other foreign firms that won bids to explore for crude oil and gas in the southernmost regions of Chile will begin drilling in August, says Mining Minister Santiago Gonzalez.
Greymouth and the other explorers — Apache Canada, Panamerican Energy and Canadian Methanex Corp — have signed special operating contracts, known as CEOPs, with the Chilean government, CNNMoney reported.
The CEOPs will have a maximum 35-year term, including a seven-to 10-year exploration phase.
In June, 2007 the Chilean government invited bids for 10 permit areas in the Magallanes Basin covering an area of 32,000 sq km and Greymouth Petroleum was awarded rights to explore, exploit and produce petroleum in four permits covering an area of 9000 sq km through the Straits of Magellan and on Tierra del Fuego. Read more