Conoco Q2 surges 150pc
LONDON:ConocoPhillips reported a 150 per cent increase in underlying quarterly profit, as the volatile refining business bounced back for the third-largest US oil company and its rivals. That massive growth in second-quarter adjusted profit is likely to set the bar for the industry as Conoco has some of the heaviest exposure to refining of any integrated oil major.
Reliance, Essar eye BP’s assets
MUMBAI: BP is in talks with India’s Reliance Industries and Essar Group to sell its African retail assets that could be worth as much as $500 million, four sources with direct knowledge of the matter told Reuters.
It was not immediately known whether BP was showing the African assets to other potential buyers. BP plans to sell $30 billion of assets over the next 18 months to cover costs related to the worst oil spill in US history.
Petrobras mishap costs $30m
RIO DE JANEIRO: Brazilian state oil company Petrobras’ offshore drilling mishap this month cost about $30 million, and the government will pay for it, a source close to the situation said.
Petrobras’ first exploration well in the offshore Libra field, which may hold more than 4.5 billion barrels of recoverable oil, collapsed when the bore struck an underwater salt bed.
NITC storing crude on 2 tankers
LONDON: Private Iranian tanker operator NITC is storing crude oil on two tankers at sea which will discharge in the coming days, NITC chairman Mohammad Souri told Reuters. “If we are talking about the number of NITC tankers at the moment, it is only two for crude oil. There are a few other ships for other purposes that is mainly condensate and not for crude oil,” he said in an interview during a visit to London. “These two ships are going to discharge within a week.” Souri said the recent sanctions imposed by the West on Iran’s petroleum imports were not having any impact on its business.
France open to Areva stake sale
PARIS: France is open to Kuwait and Qatar investors or Japan’s Mitsubishi Heavy Industries taking a stake in French state-owned energy group Areva, Economy Minister Christine Lagarde said.
Areva is planning a $3.87 billion share offering and aims to sell the shares to strategic overseas partners.“(Areva’s stake sale) will be open to those partners who are ready to enter and who we have worked with for a long time,” Lagarde told RTL radio.
Cosmo sees lower crude runs
TOKYO: Japanese refiner Cosmo Oil plans to refine 10.2 per cent less crude oil in August and September than in the same period last year amid a projection for a continued decline in domestic oil demand.
Cosmo plans to process 3.995 million kilolitres, 412,000 barrels per day (bpd), over the two months, it said in a statement.
That would put its crude refining plans for the first half of its 2010 business year, April-September, at 12.350 million kilolitres, 425,000 bpd, or 2.7 per cent lower year-on-year.
Dalian oil spill cleaned
BEIJING: Nearly 8,000 workers and hundreds of fishing boats have managed to clean up the oil spill off the major northern Chinese port Dalian, nine days after a pipeline blast leaked 1,500 tonnes of heavy crude into the sea.
“The oil spill has been all removed and the slick has basically been cleaned...the contamination has not spread to international waters or the Bohai Sea,” the official Dalian Daily cited government officials as saying.
Around the same time Dalian reopened two berths at its Xingang oil terminal, each able to dock 150,000 dead weight tonnage tankers and 80,000 dwt vessels, Dalian Port, which owns part of the facilities, said.
Formosa expects to resume
TAIPEI: Formosa Petrochemicals said it expects part of its refinery complex to restart production within a week after a massive blaze closed the operation a day ago.
The blaze at a residue desulphurising unit, which did not cause any injuries, is expected to cost Formosa Petrochemicals T$500 million ($16 million) in losses, the firm said.
The company would resume two-thirds of its 540,000 barrel per day (bpd) refinery in south-central Taiwan within days, a company spokesman said. Most of the giant refinery was not affected directly by the fire that broke out and was still smouldering.
Sinopec finds coal seam gas
BEIJING: Sinopec, China’s second-largest oil and gas producer, found a high-yielding well of coalbed methane in northern Shanxi province, as the firm moves to tap the country’s unconventional resources.
Appraisal well Yan-1, in Xiangning county of the coal-rich Shanxi province, was pumping 2,000 cubic metres of gas a day on July 15, and production has been steadily climbing since, China Petrochemicals News reported on its website.
Woodside Pluto LNG on track
PERTH: Woodside Petroleum said its flagship Pluto liquefied natural gas (LNG) project remains within market guidance but it had no success in finding additional gas to feed a planned expansion of the project.
Woodside, Australia’s second-largest oil and gas producer, posted a 10 per cent decline in second-quarter output, but most investors are shrugging off the firm’s short-term performance and focus on progress at its suite of LNG growth projects.
The key Pluto LNG project, which has been troubled by a number of labour strikes, was 91 per cent complete at the end of the June, Woodside said in its quarterly output report, adding that the estimated A$13 billion ($11.62 billion) project was within guidance and on track for first LNG shipments in early 2011.
Britain likely to face oil shock
LONDON: Britain is “very likely” to face an energy crisis within the next decade, Energy Minister Chris Huhne was quoted as saying, leaving the economy open to “very severe blows”.
In an interview with the Financial Times, Huhne said Britain faced a danger of becoming as vulnerable to oil price hikes as before the big North Sea oil fields were discovered in the 1970s.
“The world we’re going into isn’t going to be a world where the oil price will be $80 a barrel flat forever, or $150 a barrel flat forever,” he said.
“It will be a world where we will have very substantial oil price spikes, which have an enormous capacity to provide shocks to the domestic economy and to the world economy, exactly as they did in the 1970s and 80s.”
Diamond, Ensco aim to buy rigs
SAN FRANCISCO: Two of the world’s top five oil rig contractors, Diamond and Ensco, are gearing up to buy more rigs as many seem even more likely to be sold due to the regulatory backlash over the Gulf of Mexico oil disaster.
The BP well blow-out off Louisiana has shaken the industry, and while the British oil company may be close to sealing the well, activity will remain subdued even after the November 30 expiration of the US government’s drilling pause.
Diamond Offshore Drilling, the second-largest rig contractor by market value, said it had cut its dividend for the second time this year both as a defensive move and to free up funds to snap up rigs at good prices.
Fire at ERG refinery in Italy
MILAN: A fire broke out at Italian oil company ERG’s refinery in Sicily but production was not affected, the company said.
“There was a leakage of fuel gas in a pipe, which caught fire with a small flame. The whole thing lasted about 20-30 seconds,” a company spokesman said.
“There was no structural damage and no impact on production.”
ERG’s ISAB refinery has a combined capacity to process about 320,000 barrels of crude oil per day after the integration of the sud and nord plants in 2007.
HSBC in energy trading alliance
LONDON: HSBC Holdings said it had agreed a strategic alliance with French oil major Total which will give the clients of Europe’s largest bank access to energy derivative trading.
The joint venture will be run by executives from both firms and will start by offering oil derivative options but could develop into other energy products, HSBC said in its statement.
HSBC’s head of global markets Samir Assaf said in the statement the move would benefit its emerging market clients.
Motiva reports flaring at refinery
NEW YORK: Motiva Enterprises reported flaring at its 235,000-barrel-per-day Convent, Louisiana, refinery due to equipment malfunction. The filing did not specify the if the malfunction had an impact on refinery production.
Precision Drilling posts Q2 loss
CALGARY: Precision Drilling, Canada’s biggest oil and gas well drilling firm, reported an unexpected second-quarter loss, hurt by charges and foreign exchange losses, but said activity levels for the rest of 2010 will exceed those of 2009.
Demand for energy is rising as global economies start to improve and move off the bottom of the recession, the company said. It said customers are increasing drilling programmes as liquidity in capital markets and oil prices rise, though heavy rains in Western Canada have reduced activity.
“Notwithstanding the difficult weather so far in the summer of 2010, activity is running about 30 per cent ahead of 2009,” Kevin Neveu, Precision chief executive, said on a conference call.
Gas to fuel Reliance profit
MUMBAI: Reliance Industries should post a third straight rise in quarterly profit on higher gas output from its field off India’s east coast and as refining margins show signs of recovery.
Investors will be keen, too, for more detail from billionaire Mukesh Ambani’s $73.4 billion group, India’s top listed conglomerate, on plans to enter the power sector and a recently announced return to India’s telecoms arena.
“I’m positive on Reliance’s outlook. I think its foray into different sectors will create value,” said Rakesh Rawal, head of private wealth management at Anand Rathi Financial Services.
Alon restarts Big Spring FCCU
HOUSTON: Alon USA Energy restarted the gasoline-producing fluidic catalytic cracking unit at its 70,000 barrel-per-day (bpd) Big Spring, Texas, refinery after shutting it, according to a notice filed with Texas pollution regulators.
Nautilus system normal
NEW YORK: Enbridge said operations on its Nautilus natural gas pipeline system were back to normal after the company declared a force majeure due to Tropical Storm Bonnie.
The Nautilus system stretches from Ship Shoal block 207 in the Gulf of Mexico to onshore Louisiana interconnects with four interstate and three intrastate pipelines.
The 101-mile (163-km) line has a capacity of 600 million cubic feet per day, according to the company’s website. Shippers on the Nautilus system include BP. The storm dissipated over the Gulf of Mexico after shutting nearly 50 per cent of daily crude production in US-regulated areas.
KenolKobil eyeing Mozambique
NAIROBI: Kenyan oil marketer KenolKobil will establish operations in Mozambique in line with its strategy of securing regional markets with major port facilities, the company said.
Mozambique will be the firm’s eighth market as it continues its expansion drive, aimed at achieving growth through new markets outside of its home market of Kenya. Its other markets include Ethiopia and Zambia.
“The anticipated entry into Mozambique will enhance our ability to extend our reach in the hinterland market of East, Central and Southern Africa,” the company said in a statement, adding it had registered a company in Mozambique to pursue its aims.
An acquisition in Zimbabwe was still on the cards, KenolKobil added, following the unsuccessful joint bid with Engen for assets jointly operated by BP and Shell in the country.
“During our engagements with the Government of Zimbabwe and the authorities in the BP/Shell deal, we learnt lessons on how to invest in Zimbabwe, and do now fully understand the requirement of the Indigenisation law,” it said.
Under the law, locals should hold a 51 per cent stake in any foreign firm in Zimbabwe with an asset value of more than $500,000.
KenolKobil said the boar had approved a strong capital expenditure budget to facilitate expansion in Africa. It did not provide more information.
Pasadena reports valve snag
NEW YORK: Pasadena Refining reported a snag with a quench tower associated with the sulphur recovery unit at its 100,000 barrel per day (bpd) refinery in Pasadena, Texas, according to a filing with state environmental regulators.
In a filing with the Texas Commission for Environmental Quality, the company said the SRU would remain operational while the valve on the tower was replaced.
Sunoco shuts FCCU
NEW YORK: Sunoco shut the gasoline-making fluid catalytic cracking unit (FCCU) at the Point Breeze section of its 335,000 barrel-per-day (bpd) Philadelphia refinery evening, a source familiar with refinery operations said. The unit is expected to be down to repair a line leak, the source said. A company spokesman was not immediately available for comment.
Anadarko ramps up production
HOUSTON: Anadarko Petroleum said it was ramping up production on its Neptune platform in the Gulf of Mexico as pipelines come on line. All of its Gulf platforms have been restaffed.
Neptune was shut and the platforms evacuated due to the threat from Tropical Depression Bonnie in the Gulf of Mexico.
ONEOK to spend up to $730m
NEW YORK: Natural gas processor ONEOK Partners said it plans to spend up to $730 million to build natural gas liquids (NGL) projects, including a pipeline, by 2013.
ONEOK expects these projects to generate Ebitda multiples of five to seven times, and said incremental fee-based earnings from these projects are expected to increase distributable cash flow and value to unitholders.
The company said it plans to build a 525- to 615-mile NGL pipeline, which will transport unfractionated NGLs from the Bakken Shale in the Williston Basin in North Dakota, at a cost of about $450 million to $550 million. ONEOK also said it will spend $35 million to $40 million in capacity expansions for its anticipated 50-percent interest in the Overland Pass Pipeline and $110 million to $140 million to expand its fractionation capacity at Bushton, Kansas.
US refinery margins mixed
NEW YORK: US refined product margins were mixed, with only the Northeast showing a rise, as crude prices gained on potential Gulf of Mexico storm disruptions, Credit Suisse said.
Average weekly prices of West Texas Intermediate crude rose $1.22, or 1.6 per cent, to $77.60 a barrel.
ortheastern margins rose 23 cents to $7.70 a barrel. Gulf Coast margins fell 52 cents to $8.27 a barrel. Midwest margins dropped 28 cents to $10.42 a barrel. In the Rockies, margins fell $1.23 to $18.11 a barrel.
West Coast margins fell 96 cents to $15.95 a barrel.
Adnoc deepens cuts
Abu Dhabi: Abu Dhabi National Oil Company (Adnoc) said it will deepen the cut of Murban and Lower Zakum crude supply to 20 per cent below contracted volumes in September, versus a 10 per cent reduction in August.
But the company said it will raise the supply of Umm Shaif and Upper Zakum crudes to 10 per cent below contracted volumes in September, compared with a 20 per cent cut in August.
Murban is the main export grade for Opec-member the UAE, the world’s third-largest oil exporter.
Egypt-Saudi power link
CAIRO: A project aimed at linking the power grids of electricity-hungry countries Egypt and Saudi Arabia to help meet peak-time demand is expected to cost about $1.5 billion, an Egyptian official said.
An international tender for work on the project is scheduled for January 2011, Electricity Ministry undersecretary Aktham Abul Ela said.
Egypt will send Saudi Arabia electricity through the connection in the afternoons and Saudi Arabia will send electricity to Egypt in the evenings, taking advantage of the difference in the countries’ peak use hours, he added.
Sabic Q2 slows
RIYADH: Saudi Basic Industries Corp’s (Sabic) 2010I sales growth slowed during the second-quarter, while the value of its inventories surged, financial statements showed.
Compared to its level a year earlier, the value of Sabic’s inventories rose 33.3 per cent by end-June while they were up by annual 21.3 per cent by the end of March, showed the statements published on the Saudi bourse’s website.
The value of sales by end-June stood at SR38.86 billion ($10.36 billion), up 64 per cent from their level a year earlier and 14 per cent above their level in the first quarter, although their annual growth during the previous quarter topped 72 per cent.
Iran cargoes redirected
Tehran: Some gasoline cargoes previously destined for Iran have been re-offered, leaving the market well-supplied, but firm demand from most Middle Eastern countries helped to keep differentials steady.
The European Union (EU) is expected to adopt sanctions against Iran, which, combined with US and UN sanctions, adds to the difficulties Iran faces in importing fuel to meet domestic demand.
‘Owners of the cargoes are offering (them) to the market because they cannot take (them) to Iran any more,’ one trader said. ‘It is getting harder on Iran.’
Traders said, however, that Turkish and Chinese traders would still deliver gasoline to Iran, which does not have enough refining capacity to meet domestic demand.
Iraq oil exports fall
BAGHDAD: Iraq’s oil exports fell to 1.823 million barrels per day (mbpd) in June from 1.9 mbpd the month before, due to bad weather and bomb attacks, an Iraqi oil official said.
Iraq exported an average of 1.44 mbpd from the southern oil hub of Basra and 383,000 bpd from the northern oilfields around Kirkuk, including 10,000 bpd by trucks to Jordan, Oil Ministry spokesman Asim Jihad told Reuters.
“Sabotage actions in the north and bad weather in the south were reasons for the decline of oil exports in June,” Jihad said.
