Your #1 source for the latest Business and Industry News.

With over 100,000-plus readers, BIC Magazine is the Western Hemisphere's largest
multi-industry,
multi-departmental energy publication. BIC Magazine targets key decision makers in the petrochemical, refining, construction, power generation and pulp & paper industries.
For more information about BIC Magazine please contact Our Team.


Read the latest issue of BIC Magazine Online




May 24, 2013

U.S. Oil Markets More Attractive than Canada’s

Shale oil plays in the United States may be more attractive to investors than oil sands in Canada’s Alberta province, a financial analyst said.

Canadian crude oil prices are lower than other benchmarks in part because deliveries are limited by a lack of pipeline access.

Oppenheimer & Co. analyst Fadel Gheit told Bloomberg News U.S. shale oil markets were more attractive because of Canadian market issues.

"The oil sands is languishing right now because they’re really in direct competition with the shale plays in the United States,” he said.

Al Monaco, chief executive officer at Canadian pipeline company Enbridge, told Bloomberg this week pipelines are an integral part of the Canadian economy.

"When you really get down to it, Canada is an export-driven resource economy,” he said.

Click here for more information.

Today's Links

U.S. Chemical Investment Breakdown Proves Gulf Coast is Still King

Tow Vessel Fuel Problems Preceded Shell Grounding

U.S. Braces for ‘Active’ Hurricane Season

Here Come The Millennials: Good For Energy Demand?



Earl’s Pearl of the Day: "The key is to keep company only with people who uplift you, whose presence calls forth your best.” — Epictetus




May 23, 2013

Tony Blair: Oil Boom Can Ease West’s Dependency on Middle East

The world is increasingly interdependent, making it difficult for any nation to prosper in isolation, former British Prime Minister Tony Blair told a Houston audience Wednesday.

In a luncheon keynote speech at KPMG’s Global Energy Conference, Blair said European nations, like the United States, are uneasy with their reliance on oil and gas from the Middle East, and said the boom in production from shale may ease some of the need for energy from that often tumultuous region.

In discussing energy issues, he said the pace of China’s energy technology development will be key to meeting its growing demand, but expressed optimism that the world’s most populous nation will have a benign economic and political evolution.

He described the U.S.-China relationship as "a defining issue for the United States.”

Blair had other advice for Britain’s ally across the Atlantic. "Give up on wanting to be loved for being the world’s super power,” he said, but understand "people around the world look to the United States as a beacon of hope.

Click here for more information.

Today's Links

New U.S. Energy Chief Is Cautious on Gas Exports

Keystone XL’s Southern Leg Nears Completion

House Votes to Override Obama on Keystone

Virginia Officials Try Again for Offshore Energy


Earl’s Pearl of the Day:
"Personality can open doors, but only character can keep them open.” —Elmer G. Letterman



May 22, 2013

Feds Float 2-month Timeline for New LNG Export Approvals

A top Energy Department official hinted Tuesday the Obama Administration could issue licenses to export natural gas every two months, while acknowledging pressure to speed up the review process for projects with firm contracts and solid financing deals.

The comments by Christopher Smith, the acting assistant secretary for fossil energy, shed new light on how the administration might scrutinize 19 pending applications to export natural gas to countries that do not have free trade agreements with the United States.

So far, the Energy Department has blessed two such projects — Cheniere Energy’s Sabine Pass terminal in western Louisiana, which secured an export license last year, and the Freeport LNG terminal in Quintana Island, granted conditional export approval on Friday.

Energy Secretary Ernest Moniz, who was sworn in on Tuesday, reaffirmed to reporters he plans to review economic data on natural gas exports before the department acts on any of the remaining applications.

Separately, during a Senate Energy and Natural Resources Committee roundtable, Smith said the DOE issued Freeport LNG’s conditional approval roughly two months after a public comment period closed. When Sen. Lisa Murkowski (R-Alaska) questioned if a continual 60 day process is possible, Smith signaled that would be the timeline going forward.

The DOE and FERC both have roles vetting proposed liquefied natural gas export facilities. The DOE is fielding export applications on a first-come, first-served basis, but the department’s initial order gave some preference to companies that already have launched the expensive and separate regulatory process with the commission.

"Essentially, it’s first-in, first-out with priority given to those projects that have initiated that FERC pre-filing process, which is the part of the evaluation where you start spending more serious sums of money,” Smith said. "As we go through this process, some companies will make the argument they should be ahead of other companies because they’ve achieved certain milestones, and I think that’s an argument we understand and we’re sympathetic to.”

But for now, the DOE has not changed the order in which it will review applications. "It would not be out of the realm of the possible to consider different ways of ordering,” he said, "but for now, the policy … is we’ve set an order … and that’s the sequence we’re currently working through.”

Smith’s carefully worded comments could give room for Moniz to make changes and put his imprint on one of the biggest policy debates at the Energy Department.

Click here for more information.

Today's Links

Obama Threatens Keystone XL Veto

Five States Help Boost U.S. Oil Production

Companies Pitch in for OKC Relief Efforts

Using Solar Power to Pump Oil

Earl’s Pearl of the Day:  "Courage is resistance to fear, mastery of fear — not absence of fear.” — Mark Twain




May 21, 2013

Judge tosses obstruction charge against former BP exec in spill case


A federal judge Monday threw out an obstruction of Congress charge against a former BP executive who had been accused of lying about the amount of oil that was flowing after the 2010 Gulf of Mexico oil spill.

U.S. District Judge Kurt D. Engelhardt handed a major victory to David Rainey of Houston by issuing the 44-page ruling on several pre-trial motions.

Rainey still faces a charge of making false statements to federal investigators, stemming from an interview he gave to prosecutors before he was charged. He faces up to five years in prison on that charge.

In dismissing the obstruction of Congress charge, the judge sided with the defense arguments that the government failed to allege knowledge of a pending congressional investigation and that the law Rainey was charged under does not apply to congressional subcommittee investigations.

"We’re gratified by the court’s thoughtful and well-reasoned opinion,” Rainey attorney Brian Heberlig said in a telephone interview.

Justice Department spokesman Peter Carr said the agency was reviewing the decision and would have no further comment at this time.

Rainey faces an Oct. 15 trial on the remaining charge. He has pleaded not guilty. Prosecutors can appeal the dismissal of the obstruction charge, though it wasn’t immediately clear if they will.

Rainey no longer works for BP. He is now president of exploration for BHP Billiton.

Two BP well-site leaders face manslaughter charges in the Gulf oil spill case, while a former BP engineer faces obstruction of justice charges. BP pleaded guilty to manslaughter, obstruction and other charges and agreed to pay $4.5 billion in criminal fines and Securities and Exchange Commission fines.

The British oil giant owned the undersea well that blew out in the Gulf off Louisiana, triggering an explosion on the Transocean-owned Deepwater Horizon rig that killed 11 men. The resulting oil spill was the worst offshore spill in U.S. history.

Click here for more information.

Today's Links

Texas Company Planning Eagle Ford Refinery

PAA to Extend Western Oklahoma Oil Pipeline

Alaska Pushes to Study Arctic Refuge Oil Amid U.S. Reluctance

Oil Fixing Probe Accelerates as EU Asks Traders for Help


Earl’s Pearl of the Day:
"Freedom is a possession of inestimable value.” — Cicero

Tonight is the BIC Alliance hospitality event at AFPM! We look forward to seeing you there!
























May 20, 2013



Energy Department Approves Natural Gas Export Permit

The Obama Administration has cleared the way for broader natural gas exports by approving a $10 billion facility in Texas, a milestone in the United States’ transition into a major supplier of energy for world markets.

The decision shows how the boom in U.S. natural gas production has caused a 180 degree shift in a key area of energy trade.

Five years ago, many companies built natural gas import terminals, anticipating greater U.S. demand for imported fuel. Now a group of private investors, that includes ConocoPhillips, plans to turn one of those terminals — in Quintana Island, Texas — into an export facility to ship natural gas to Japan and other nations. The project is known as Freeport LNG.

In giving Freeport the green light, the DOE signaled it found the prospective benefits from exporting energy outweighed concerns about possible downsides for the U.S. economy.

Proponents of greater exports, including the oil and gas industry, say exporting inexpensive natural gas will help the U.S. trade balance, help advance the adoption of clean burning fuels around the world and shore up energy poor U.S. allies.

Opponents counter exports may cause domestic prices to rise, hurting consumers and some industries such as chemicals that have benefited from cheap natural gas.

API urged the DOE to approve the remaining applications without delay "so the United States can achieve its full energy and economic potential.”

The DOE said it has given preliminary authorization to the Freeport project to export up to 1.4 billion cubic feet per day of liquefied natural gas. The approval is needed for exports to countries with which the United States doesn’t have a free trade agreement, a category that includes major trading partners in Europe and Asia. The project still requires final approval from the Federal Energy Regulatory Commission.

The Freeport terminal is the second export facility approved by the Obama Administration. Cheniere Energy’s Sabine Pass facility in Louisiana won approval in May 2011 to export LNG to the countries without free trade agreements.

The DOE will next consider the application of a slightly larger export facility in Lake Charles, La. While there are nearly a score of outstanding applications, analysts expect only a handful will be built due to the high cost of gas liquefication facilities.

Click here for more information.

Today's Links

Coast Guard to Take Testimony on Shell’s Arctic Grounding

Arctic Nations Adopt Marine Oil Pollution Preparedness Agreement

Could Philadelphia Become ‘Cushing East’?

Texas to Sue BP over Gulf spill


Earl’s Pearl of the Day: "We are what we believe we are.” — C. S. Lewis

Don't Forget to visit the BIC Hospitality Event at AFPM this week! Have a great show to all who are attending!


















May 17, 2013



Third U.S. House Committee Approves Keystone XL Pipeline

The House Transportation Committee approved a measure that would allow construction of the Keystone XL pipeline without action by President Barack Obama, the third panel to push the pipeline bill this year.

The bill now goes to the full House after the committee voted 33-24. The Republican-led initiative is largely symbolic. The Democratic-controlled Senate isn’t considering a similar bill and it would be subject to a veto by Obama.

"The administration has had enough time,” said Representative Bill Shuster (PA), the Republican chairman of the House transportation panel. "The studies have been done and this project checks out. It’s time to let this project proceed.”

The House Natural Resources Committee and the Energy and Commerce Committee previously approved the Keystone bill. The measure seeks to bypass the permit process that requires the State Department to review and decide on the pipeline because it crosses an international boundary.

Democrats on the transportation panel said the jobs that would be created by the project would only be temporary and building the pipeline posed risks to the environment. Rep. Nick Rahall (WV), the top Democrat on the panel who said he supported Keystone, opposed the bill because he said it would give Calgary-based TransCanada Corp. the permits it needs for construction, an advantage he said isn’t available to U.S. companies.

TransCanada’s $5.3 billion pipeline, which would carry tar sands oil from Canada to U.S. refineries near the Gulf of Mexico, has been among the most prominent energy fights for the past two years. Obama’s Administration is expected to decide on whether to permit the pipeline to cross the border later this year.

Click here for more information.

Today's Links

For U.S. LNG and LPG Exporters, Canal Expansion Adds Market Flexibility

Moniz Formally Approved as U.S. Energy Secretary

Senate Panel Advances Nominee for EPA

New Eagle Ford Rail Park Planned for Bexar County



Earl’s Pearl of the Day: "Believe you can and you’re halfway there.” — Theodore Roosevelt




May 16, 2013

New Pipeline to Triple Gas Imports from United States


The construction of a natural gas pipeline from southern Texas to central Mexico for state-owned oil company Petroleos Mexicanos, or Pemex, will allow gas imports from the United States to triple, to around 3 billion cubic feet per day by 2015 to meet increasing demand by industry for the relatively cheap fuel, a Pemex official said Wednesday.

Alejandro Martinez Sibaja, the director of Pemex’s gas division, said in an interview that Mexican industry is currently hampered by its reliance on more expensive fuels because of the lack of pipeline capacity for natural gas to come across the border.

"The lack of gas means our industries are having to burn fuel oil,” which is currently about three times as expensive as natural gas, Martinez said. "A lot of investment is looking to come to Mexico, so we have to respond by providing natural gas as part of our offer to get these companies to come.”

Click here for more information.

Today's Links

Wolverine Terminals to Invest $30 Million in Louisiana Terminals Project


Drilling Rig Boom in Texas — and Across the United States

Natural Gas Onshore Eases Hurricane Threat

Former BP Chief Becomes Interim Chairman for Swiss Firm


Earl’s Pearl of the Day:
"We are what we repeatedly do. Excellence, then, is not an act, but a habit.” —
Aristotle


May 15, 2013


Gulf of Mexico Growth Increases Need for Storm Evac Planning

The growth in deepwater operations in the Gulf of Mexico has increased the need for emergency transportation facilities that can move workers out of harm’s way in case of a hurricane, a Shell transportation expert said.

Deepwater drilling in the Gulf of Mexico has increased for many of the major operators, according to Patrick Bosman, aviation manager for the Gulf of Mexico for Royal Dutch Shell. Shell has more than 2,500 workers out in the Gulf on any given day, increasing the demand for helicopters in the case of an emergency. Shell’s Perdido installation, for example, is more than 200 miles from the coast, so a round trip helicopter evacuation trip takes several hours.

"It takes about three days to conduct an evacuation and we need those three days,” Bosman said. "We have to prepare for a full-blown evacuation.”

While the threat of an explosion or a cyber attack has received more attention, hurricanes demand more planning because of the resources required, as many platforms need to be evacuated in a short time period, each requiring multiple helicopters.

Companies typically begin evacuating nonessential offshore workers with the first notification of a possible hurricane, as they try to assess the extent of the threat. If the storm progresses, the installation is secured and fully evacuated.

The worst case scenarios involve hurricanes that arrive with little warning, such as 2005’s paralyzing Hurricane Katrina, which found the industry relatively unprepared.

Click here for more information.

Today's Links

Kinder Morgan Project Aims to Ease Houston Ship Channel Congestion


EU Oil Manipulation Probe Shines Light on Platts Pricing

Alaska: Cook Inlet Cosmopolitan Well Spudded

Job Market Particularly Strong for Deepwater Pros


Earl’s Pearl of the Day: "Life shrinks or expands in proportion to one’s courage.” — Anais Nin


May 14, 2013

IEA Sees U.S. Oil Shockwaves Ousting OPEC as Supply Driver

The United States shale boom will send "shockwaves” through the global oil trade over the next five years, benefiting the nation’s refiners and displacing Organization of Petroleum Exporting Countries (OPEC) as the driver of supply growth, the International Energy Agency (IEA) said.

North America will provide 40 percent of new supplies to 2018 through the development of light, tight oil and oil sands, while the contribution from OPEC will slip to 30 percent, according to the IEA. The IEA trimmed global fuel demand estimates for the next four years and predicted consumption in emerging economies may overtake developed nations this year.

"The supply shock created by a surge in North American oil production will be as transformative to the market over the next five years as was the rise of Chinese demand over the last 15,” the Paris-based adviser to 28 oil-consuming nations said in its medium-term market report.

The development of U.S. shale resources, enabling the nation’s highest level of energy independence in two decades, is creating a "chain reaction” in the global transportation, processing and storage of oil that may escalate as other countries try to replicate the American oil boom, according to the IEA. Crude futures for settlement in 2018 are trading at a discount to current prices, signaling expectations for increasing supplies and constrained demand.

"The U.S. production comes as a godsend solution for a market where emerging market demand is continuing to increase, while supply in the Middle East and North Africa won’t increase that much,” Bjarne Schieldrop, chief commodity analyst at SEB AB in Oslo, said.

North American production will increase by 3.9 million barrels a day from 2012 to 2018, making up more than half of the non-OPEC gain. Access to these supplies has rescued many U.S. refineries from closure and will secure their place as exporters of gasoline and naphtha, while hurting other operators that aren’t configured to process the new lower-sulfur, low-density crude, the IEA said.

"Tight oils are a very important source of current supplies, and will be for the foreseeable future, but one shouldn’t get carried away,” said Amrita Sen, chief oil market analyst at Energy Aspects Ltd. in London. "If we get a few years of oversupply, prices falls and we will see tight oils output fall.”

Click here for more information.

Today's Links

House Bill Aims to Expedite U.S. Gas Pipeline Construction

With Pipelines on Hold, Oil Storage Services Boom

Chesapeake Thinks It Has 342 Million Barrels in Eagle Ford

U.S. Ethylene Cracker Margins Rise on Production Outages, Drop in Feedstock Costs


Earl’s Pearl of the Day: "You cannot shake hands with a clenched fist.” — Indira Gandhi


May 13, 2013

Arctic Oil, Natural Gas Defined as U.S. Priority

Arctic territory off the northern coast of Alaska is a key element of U.S. national and energy security interests, a national plan states.

A U.S. government 13-page national strategy says the arctic off Alaska region has conventional oil and natural gas resources make up about 13 percent of the world’s undiscovered oil and 30 percent of the undiscovered natural gas.

Parts of the region have become more accessible to energy explorers because of warming trends. The national strategy said these "fresh ideas” have led to concerns about uncoordinated development of arctic reserves.

"It is imperative the United States proactively establish national priorities and objectives for the arctic region,” the plan states.

Last year Shell delayed plans for the region following equipment issues and weather delays. ConocoPhillips said it is reluctant to move forward because of regulatory uncertainty.

The strategy said arctic oil and natural gas reserves are included as part of President Barack Obama’s so-called all-of-the-above domestic energy initiative and therefore is part of the nation’s energy security priorities.

"The arctic region’s energy resources factor into a core component of our national security strategy: energy security,” it states.

Click here for more information.

Today's Links

Lebanon Has 30 Trillion Cubic Feet of Offshore Gas

U.S. Drilling Rig Count Up 5 Units to 1,769

Drilling Waste Finds New Use

OTC Crowd Reaches 30-Year High

Earl’s Pearl of the Day:
"Holding on to anger is like grasping onto a hot coal with the intent of throwing it at someone else. You are the one who gets burned.” — Buddha



May 10, 2013

ExxonMobil to Build $10 Billion U.S. LNG Export Plant with Qatar


ExxonMobil, the largest energy company by market value, signed an agreement with Qatar Petroleum International (QPI) to move forward with construction of a $10 billion natural gas export terminal in Texas.

The project will involve installing liquefaction equipment at an existing import facility in Sabine Pass, Texas. It won permission last year to export the fuel to nations with free trade agreements with the United States and is awaiting approval to send the fuel to all other countries.

Exxon and state-owned Qatar Petroleum plan to ship as much as 15.6 million metric tons of gas annually from the Golden Pass facility. A boom in U.S. production has spurred several proposals to export the fuel, which is cooled to liquid form at -260F to reduce volume and allow for transportation by ship.

"This agreement sets out a highly competitive commercial blueprint for Golden Pass Products, with a commitment that builds on the unique combined strengths of QPI and ExxonMobil through the global downstream LNG value chain,” said Bill Collins, president of Golden Pass.

Exxon has been expanding its worldwide gas portfolio with acquisitions such as the 2010 purchase of XTO Energy in the United States and investments in projects that include the $52 billion Gorgon LNG complex in Australia. Gas accounted for half of Exxon’s global production during the first three months of this year.

Click here for more information.

Today's Links

BSEE, Coast Guard Enter Agreement to Improve Offshore Oversight


U.S.-Mexico Collaboration Seen Necessary on Eagle Ford Drilling

Harper to Visit New York in Push for Keystone Approval

California Postpones Oil, Gas Lease Auctions


Earl’s Pearl of the Day: "He who labors diligently need never despair; for all things are accomplished by diligence and labor.” — Menander


May 9, 2013

BP Exec Tells OTC Audience about Lessons Learned in Gulf Spill Response

Even as BP continues to fight litigation that could result in it having to pay billions of dollars more in fines and damages stemming from the 2010 Gulf of Mexico oil spill, a senior company official says the British oil giant has already gone "above and beyond” what the law requires.

Mike Utsler, who is heading BP’s Gulf restoration effort, acknowledged at a luncheon gathering at the Offshore Technology Conference in Houston there is still more work to be done to right the wrong. But, he insisted, BP continues to meet its obligations and commitments.

"We’ve made tremendous progress in the cleaning of those shorelines,” Utsler said.

Utsler also spoke about the lessons learned, the technology advancements that were created and the industry collaboration that was generated following the worst offshore oil spill in U.S. history.

"I don’t believe any of us had a true appreciation of the scale and magnitude we would face in terms of challenges in the area of data management,” Utsler said.

He said the volume of data BP amassed following the disaster was equivalent to roughly half the data and information contained in all the university libraries in the United States.

"Communication from air to sea to land, from office to beach to boat, to deepwater environments, we had to build an infrastructure of communications,” Utsler said. "It was a massive undertaking, but also a major learning experience.”

As a leader in that effort, Utsler said he has faced many challenges, but also has found the work rewarding.

"We faced so many challenges in understanding our stakeholders and managing our stakeholders in a crisis,” he said. "Was it perfect? No. Did it offer growing pains? Yes it did.”

Click here for more information.

Today's Links

Shell Moving Forward on Significant Offshore Projects


Deepwater Well Containment Exercise Completed

Offshore Operators Should Focus on Building Safety Barriers

NATO Won’t Up Presence In The Arctic


Earl’s Pearl of the Day: "Waste not fresh tears over old griefs.” — Euripides


May 8, 2013

Exxon Starting Development of $4 Billion Gulf of Mexico Field

ExxonMobil, the largest U.S. oil company, said it will invest more than $4 billion in the development of its Julia oil field in the Gulf of Mexico.

Oil production is expected to start in 2016 from the field, which was discovered in 2007. The resource in place is estimated to be almost 6 billion barrels.

The Julia unit was the subject of a 2011 Exxon lawsuit against the United States over the government’s decision to cancel the offshore leases because Exxon hadn’t proceeded quickly enough with development. The litigation was later settled, allowing the company "to develop this very large, but technically challenging, resource as quickly as possible using a phased approach,” Patrick McGinn, an Exxon spokesman, said in January 2012.

An initial phase of the project is designed for daily output of 34,000 barrels of oil. It will have tie-backs to a production facility operated by Chevron. Exxon and Statoil both have a 50-percent stake in the Julia unit.

"Julia is one of the first large oil discoveries in the ultra-deepwater frontier of the Gulf of Mexico,” Neil Duffin, president of Exxon’s development company, said. "This resource is located more than 30,000 feet below the ocean’s surface. Enhanced technologies will be deployed to ensure the safe and environmentally responsible development of this important energy resource.”

Click here for more information.

Today's Links

Enbridge to Add Facilities at Cheecham Terminal for Surmont Phase 2

Shell Gets Rolling on Stones

U.S. to Release Arctic-Specific Drilling Rules Before Year End

U.S. Lowers Forecast for Summer 2013 Gasoline Prices


Earl’s Pearl of the Day: "Success is liking yourself, liking what you do, and liking how you do it.” — Maya Angelou


May 7, 2013

Cheniere LNG Facility Ahead of Schedule

Cheniere Energy said construction is ahead of schedule at its Sabine Pass LNG facility in Louisiana.

Cheniere said its Cameron Parish facility’s first two production units are expected to begin producing LNG in late 2015. About 26 percent of the construction was completed as of March 31.

Two additional units have received the necessary approval from the Federal Energy Regulatory Commission and U.S. Department of Energy. The company is in the process of securing the financing to build those units.

Cheniere originally built multibillion-dollar facilities to import LNG into the United States, but now, due to a glut of North American gas, is converting the existing import terminals to export the fuel.

This is the first project to achieve federal regulatory approval that will allow Cheniere to chill gas to minus 260 degrees Fahrenheit so it can be transported overseas by ship.

Cheniere borrowed $5.9 billion to convert the first two units. Korea Gas Corp., BG Group Plc, Gas Natural SDG SA and Gail India Ltd. have agreed to buy a combined 16 million tons a year from the Sabine Pass terminal.

Click here for more information.

Today's Links

Rick Perry to Obama: Give Coastal States More Access & Dollars

U.S. Gas-Export Debate Tips to Geopolitical Edge

Interior Secretary Tours Rig in U.S. Gulf

U.S. House Ways and Means Panel Releases Details of Energy Tax Reform Plans


Earl’s Pearl of the Day: "That which does not kill us makes us stronger.” — Friedrich Nietzsche


May 6, 2013

SEC Warns of Oil and Gas Securities Scams


The U.S. Securities and Exchange Commission (SEC) has cautioned investors over potential frauds involving private securities offerings for oil and gas ventures, a threat that has been on the rise in recent years, according to the agency.

While the alert was not prompted by any single case, the SEC said it is handling an average of more than 20 fraud cases per year related to private oil and gas ventures. In 2006, there were "few” such cases, the alert said.

The SEC identifies several "red flags” in the alert, such as sales pitches referring to recent news events like high oil or gas prices, "can’t miss” wells and "guaranteed” returns, abnormally high rates of return and sales pitches touting new technology, especially if it relates to getting higher production out of low-producing wells.

Investors should look at the industry track record of a company and understand in detail how invested money will be used, the SEC said.

Click here for more information.

Today's Links

Cheniere: LNG Facility Ahead of Schedule

ConocoPhillips and Buccaneer Ink Alaskan Deal

Offshore Operators Seek Clarity on Regulations

Oil Industry On Alert — Active Hurricane Season Forecast


Earl’s Pearl of the Day: "You should not live one way in private, another in public.” — Publilius Syrus



May 3, 2013
 

For U.S. LNG, LPG Exporters, Canal Expansion Adds Flexibility


The $5.25 billion Panama Canal expansion project coincides with the planning and development of infrastructure to export large volumes of natural gas from the United States. The Panama Canal Authority is taking steps to capture a share of this emerging source of business by adjusting its operational plans for the important Central American waterway. Approximately 1,700 miles to the northwest, on the Texas/Louisiana Gulf Coast, two companies instrumental in selling liquefied natural gas (LNG) and liquefied petroleum gas (LPG) produced in the United States view the project in Panama as a means of reaching more customers.


Click here for more information.

Today's Links


Study: Oil, Gas Industry Needs to Step Up Water Management

Oil Drilling Technology Leaps, Clean Energy Lags

Enterprise to Expand Crude Oil Storage, Distribution Serving Southeast Texas

Boise to Invest $111 million in Louisiana Paper Mill Upgrade

Earl’s Pearl of the Day:
"Happiness is not something ready made. It comes from your own actions.” — Dalai Lama


May 2, 2013

Phillips 66 to Increase Export Capacity, Refine More North American Crude

U.S. refiner Phillips 66 said it plans to increase its product export capacity by 50,000 bpd to 370,000 bpd by the end of this year and to raise the volume of less expensive North American crude it processes at its U.S. refineries.

Announcing its earnings for first quarter 2013, which more than doubled to $1.4 billion, Phillips partly credited the increased use of "advantaged crudes” in its refineries, which pushed profit margins to $13.94 per barrel in the first quarter.

Phillips is moving this cheaper crude from the Midcontinent and Canada to its refineries on both coasts using rail and barge. It recently took delivery of 400 railcars out of the 2,000 ordered to move primarily Bakken to the East and West coasts.

Over the next 12 months, the company expects to process an additional 150,000 bpd of low-cost North American crude oil.

Phillips 66 also said it exported 150,000 bpd of refined products in the first quarter, a "significant increase” from the same period of 2012.

Projects completed at its Ferndale, San Francisco and Alliance refineries expanded refined product export capability by 35,000 bpd. In total, Phillips 66 has the capacity to export 320,000 bpd from its domestic refineries.

"Through further investment at [our] facilities on the Gulf and West coasts, export capability is expected to increase to 370,000 bpd by the end of 2013,” Phillips 66 CEO Greg Garland said.

Phillips 66 also said it was pursuing the development of a 100,000-bpd capacity NGL fractionator at Old Ocean, Texas, the site of its 247,000-bpd Sweeny refinery.

If approved, construction is expected to begin in the first half of 2014, with start-up anticipated in the second half of 2015.

"Our plans for a new NGL fractionator on the Gulf Coast reinforce our commitment to the American energy landscape and highlight our unique opportunities across the downstream value chain,” Garland said.

Click here for more information.

Today's Links

Enbridge to Build East Texas Cryo Plant

Shale Gas Boom Fuels Rebound in Growth for N. American Smart Grid Equipment

Petrobras Sells Stake in Gulf of Mexico

OTC Looks to Social Media to Expand Attendee Experience


Earl’s Pearl of the Day: "If you wish your merit to be known, acknowledge that of other people.” — Oriental Proverb



May 1, 2013

Bakken Resource Estimate Jumps

The Bakken and Three Forks tight-oil formations in North Dakota and Montana contain more than twice as much recoverable oil than previously thought, according to a new assessment by the U.S. Geological Survey (USGS).

The updated assessment, which also includes reserves in South Dakota, found the formations contain an estimated mean of 7.4 billion barrels of undiscovered, technically recoverable oil.

According to the assessment, the Bakken holds an estimated mean oil resource of 3.65 billion barrels and the Three Forks Formation has an estimated mean resource of 3.73 billion barrels.

That represents a more than twofold increase over the estimated mean of 3.65 billion barrels in the 2008 assessment.

"These world-class formations contain even more energy resource potential than previously understood, which is important information as we continue to reduce our nation’s dependence on foreign sources of oil,” said recently confirmed Interior Secretary Sally Jewell.

Since the 2008 assessment, more than 4000 wells have been drilled in the Williston basin, which has added to federal and industry understanding of the Bakken geology.

The USGS also estimates the formations contain a mean of 6.7 trillion cubic feet of undiscovered, technically recoverable natural gas — a threefold increase over the 2008 estimate.

The USGS considers the Bakken and Three Forks to be the largest continuous oil formation in the lower 48 U.S. states.

Click here for more information.

Today's Links

Judge Orders Some BP Attorney Materials Turned Over in Gulf Oil Spill Case

BSEE Launches Deepwater Oil, Gas Containment Exercise in GOM

Booming North American Oil Supply Boosts U.S. Refiners’ Profits

Saudi Oil Minister Says Saudis Welcome U.S. Production Growth


Earl’s Pearl of the Day:
"Good manners will open doors the best education cannot.” — Clarence Thomas


April 30, 2013

Shell Australia Head to Run U.S. Arctic Operations

Royal Dutch Shell is moving its Australian head to run operations in the U.S. Arctic Ocean, a person familiar with the matter says, as the oil major attempts to recover from a series of drilling setbacks in the icy north.

Ann Pickard, who has been overseeing billions of dollars of investments in Australian gas-export projects, would take up a new role in the United States on June 1, the person said.

The reshuffle comes after Shell’s planned summer drilling program in the U.S. Arctic Ocean was cancelled due to severe damage to rigs capable of operating in harsh conditions. It was the second consecutive year the company wasn’t able to drill in the region, having been frustrated before by bad weather and mechanical and regulatory challenges.

Shell’s Arctic drilling plans form an important plank in its efforts to replace falling output elsewhere. They also underscore the difficulty that big energy companies face in finding significant deposits of conventional oil as easy-to-access reserves are depleted and many big discoveries lie in countries less welcoming to foreign investment.

Pickard will succeed David Lawrence who left Shell in March by "mutual consent” in the wake of the setbacks.

The U.S.-born executive is no stranger to tough assignments. She spent five years in Nigeria as a regional vice president for sub-Saharan Africa at a time when Shell’s operating record in the country was under scrutiny due to years of oil spills, while militants often targeted its oil installations such as pipelines. That stint led "FORTUNE” Magazine to call her the "the bravest woman in oil” and one of the 50 most powerful women in business.

Click here for more information.

Today's Links

Surge in U.S. Natural Gas Pushes Other Countries to Diversify

U.S. Crude Exports Jump to 13-year High

Alberta Eyes Oil Pipeline to Arctic

Malware Offshore: Danger Lurks Where the Chips Fail


Earl’s Pearl of the Day: "Do not dwell in the past, do not dream of the future, concentrate the mind on the present moment.” — Buddha



April 29, 2013

Bill Would Force Feds to Sell Drilling Leases Off Virginia Coast

The Obama Administration would be forced to sell offshore drilling leases off the coast of Virginia under a bill introduced in the House on Friday.

The measure, sponsored by Virginia Republican Scott Rigell, aims to mandate the reschedule Lease Sale 220, an auction which was first planned for 2011 under President George W. Bush but canceled in the wake of the Deepwater Horizon disaster in 2010.

Rigell’s bill also would force the Interior Department to conduct at least one auction for the region 50 miles off Virginia’s coast during each five-year lease sale program.

The government’s current five-year plan, spanning 2012 to 2017, contains no auctions for Atlantic oil and gas drilling rights, though the Interior Department is on track to allow seismic research in the region. Assistant Interior Secretary Tommy Beaudreau told Congress by helping to define the potential energy resources along the East Coast, those seismic surveys would inform future decisions about leasing in the area.

Although some Virginia leaders have lobbied hard for the auction of nearby offshore tracts, Interior Department officials said the auction ultimately wasn’t included in the 2012-2017 plan because of opposition from other Atlantic Coast states and concerns raised by the Defense Department, which conducts exercises in the region.

Rigell’s bill includes a sweetener for Mid-Atlantic states to go along, by allowing them to cash in on 37.5 percent of royalties paid to the federal government for oil and gas produced on the offshore leases. Similar revenue sharing agreements are already in place for Gulf Coast states, beginning in 2017. And coastal senators Mary Landrieu (D-La.) and Lisa Murkowski (R-Alaska) are leading a push to expand revenue sharing even further.

Click here for more information.

Today's Links

TransCanada Pushes Back Proposed Keystone XL In-Service Date

Heavy Louisiana Sweet Strengthens as Brent Spread to WTI Widens

EPA Lowered Estimates of Methane Leaks During Natural Gas Production

Overall Oil, Gas Wages Flat, but Specialty Positions Still Command Top Pay


Earl’s Pearl of the Day: "Always do your best. What you plant now, you will harvest later.” — Og Mandino




April 26, 2013

Methanex to Move Another Methanol Plant to Louisiana

Methanex Corp. has reached a final investment decision to proceed with the relocation of a second 1-million-ton-per-year methanol plant from its Chile site to Geismar, La. The plant is expected to be operational by early 2016 and has an estimated total cost of approximately $550 million.

John Floren, president and CEO of Methanex, commented, "We are excited to move forward with the Geismar II project. We have made excellent progress with our first plant relocation, Geismar I, and that project is proceeding on schedule and on budget. The first shipment of equipment has been loaded and is currently in transit to Louisiana. Methanex will leverage its experience gained from Geismar I to ensure a smooth execution for Geismar II.”

Mr. Floren added, "The global demand outlook for methanol is very favorable and demand is expected to outpace capacity additions in the industry over the next several years. Relocating a second plant to Louisiana allows us to benefit quickly from the competitive natural gas price environment in North America and add additional molecules to our system to supply our customer’s growing requirements for methanol.”

Click here for more information.

Today's Links

Transocean Ordered to Turn Over Deepwater Horizon Docs

ConocoPhillips: No New Timeline for Arctic Drilling Program

U.S. Offshore Deaths ‘Seven Times’ Average

Frac Daddy to Represent Oil Field Workers in Kentucky Derby Run


Earl’s Pearl of the Day: "It’s all knowing what to start with. If you start in the right place and follow all the steps, you will get to the right end.” — Elizabeth Moon



April 25, 2013

Western Gulf Lease Sale Set for Aug. 28

Oil and gas companies will have a chance to buy drilling rights on more than 21 million acres in the western Gulf of Mexico during a lease sale in August.

The lease sale will come one year after an auction of similar western Gulf tracts that netted nearly $134 million.

Some 3,953 blocks spanning 21.2 million acres will be up for grabs in the auction, with water depths ranging from 16 to roughly 11,000 feet.

For the first time in years, companies will not be able to take advantage of a federal royalty relief program aimed at gas extracted from deep water tracts purchased in the lease sale, since that provision is set to expire on May 3.

The proposed notice of sale unveiled Wednesday includes details about the possible terms that will govern five-, seven- and 10- year leases purchased in the upcoming auction, as well as the environmental mitigation that energy companies would be required to follow.

Companies will be forced to pay a minimum bonus bid of $25 per acre (or fraction) for acreage in less than 400 meters of water and $100 or more per acre for blocks in deeper territory. Energy produced from the leases would be subject to an 18.75 percent royalty rate plus annual rental fees starting at $7 per acre for the shallowest territory — but increasing to as high as $44 an acre after eight years.

This will be the first sale since former REI CEO Sally Jewell was sworn in as secretary of the interior. In a news release, Jewell described the Gulf of Mexico as "a cornerstone of the United States’ energy portfolio.”

Click here for more information.

Today's Links

Japanese Minister to Visit U.S. to Urge LNG Exports

Chesapeake Named No.21 to the Best for Vets Employers

Baucus’ Retirement Could Put Louisiana Democrat in Charge of Energy Panel

Ice Gas: A Step Closer to Commercial Production

Earl’s Pearl of the Day: "There is a sacredness in tears. They are not the mark of weakness, but of power.” — Washington Irving



April 24, 2013

Gulf Heats Up with High Rig Counts and Cutting-Edge Technology

Activity in the Gulf of Mexico is continuing to heat up, with both operators and oil field services companies seeking ways to stake out their share of the market.

The U.S. Gulf of Mexico now has 37 active floating rigs, five more than the pre-Macondo count of 32 rigs, according to a Barclay’s analyst. This number is expected to continue to grow, with 15 additional units scheduled to enter the market, 13 of which are new.

For operators, the cost of these new wells is tied to the time it takes to drill them, and oil field services companies are racing to provide the most efficient results.

Chevron and Halliburton announced Tuesday they have completed three offshore wells in the Gulf of Mexico using new Halliburton technology that shaved 18 days off the well completion time.

The technology, which is designed for work in the ultra-deep waters, stimulates a greater area within the reservoir in a shorter period of time than traditional methods, by reducing the number of trips needed to stimulate the well. It uses a combination of strong pumping power and a special formula of well fluids.

"Having to make multiple runs in and out of the wellbore equates to a large expense for operators,” said Ron Shuman, senior vice president of Halliburton’s Southern and Gulf of Mexico regions. "The ‘single trip’ element of this system provides significant time savings with improved reliability and better asset optimization.”

The incentive to develop these kinds of technology improvements is likely to continue if activity in the Gulf reaches the rate predicted by Barclays — an estimated 52 rigs in 2014 and as many as 60 by 2015.

Click here for more information.

Today's Links

Three North Slope Exploratory Tests Find Oil

Anadarko Seeks Dismissal of Investor Suit Over Gulf Spill

Task Force Unveils Oil, Gas Road Safety, Management Recommendations


Critics, Allies Blast Obama Over Keystone Pipeline


Earl’s Pearl of the Day: "Make up your mind to act decidedly and take the consequences. No good is ever done in this world by hesitation.” — Thomas H. Huxley



April 23, 2013

Bill Seeks to Allow Drilling Near U.S. Mexico Maritime Border

A legislative hearing will take place Thursday in Washington D.C. as lawmakers consider a bill that would lift the current moratorium on drilling along the U.S.-Mexico maritime border in the Gulf of Mexico.

H.R. 1613, the Outer Continental Shelf Transboundary Hydrocarbon Agreement Authorization Act, would amend the Outer Continental Shelf Lands Act and implement the terms of the U.S.-Mexico Transboundary Hydrocarbon Reservoirs Agreement. That agreement, signed in February 2012 by then Secretary of State Hillary Clinton and Mexico’s Minister of Foreign Affairs Patricia Espinosa Castellano at the G-20 Summit in Los Cabos, Mexico, would govern development of shared oil and natural gas resources in the U.S. Gulf between the United States and Mexico maritime border.

The agreement lifts the current moratorium on exploration and production along the Western Gap section of the boundary, opening up 1.5 million acres in the Gulf previously off limits due to border issues, and provides a framework for the safe management of oil and gas resources in the boundary area. Leaseholders on the U.S. side of the boundary and Petroleos Mexicanos would be able to explore and exploit a transboundary reservoir as a unit as leaseholders are permitted to do on the U.S. side of the boundary. The agreement also would allow a means of resolving disputes and establish a system of joint inspections.

"This bill is another step toward embracing an all of the above approach to energy that safely develops our natural resources to help achieve North American energy independence,” said Rep. Jeff Duncan (R-S.C.), who co-authored the bill along with House Natural Resources Committee Chairman Doc Hastings (R-Wash.) and House Foreign Affairs Subcommittee on Western Hemisphere Chairman Matt Salmon (R-Ariz.), in a statement. "This bill will help lower energy costs while creating American jobs by safely opening up more areas in the Gulf of Mexico for exploration and production.”

"Approval and implementation of this agreement is unquestionably in the national interests of the United States as a step toward energy security and job creation in the United States, as well as much needed energy reform in Mexico and Western Hemisphere energy independence,” said Salmon in a statement. "We can achieve energy independence and better energy cooperation with our neighbor and this is an important step in that direction.”

The U.S.-Mexico maritime border area could hold up to 172 million barrels of oil and 304 billion cubic feet of natural gas, according to the U.S. Department of the Interior.

Click here for more information.

Today's Links

Survey Finds Majority Backs Keystone Pipeline

Irish Spud for ExxonMobil

Chevron’s Big Foot Hull Arrives in Texas

BP Oil Spill Settlement Claims Can Be Paid While BP Appeals Judge’s Decision



Earl’s Pearl of the Day: "Wisdom is knowing what to do next; virtue is doing it.” — David Starr Jordan



April 22, 2013

Halliburton in Settlement Talks to Resolve Gulf Spill Claims

Oil field services firm Halliburton said Monday it has recently entered into settlement discussions and offered cash and stock to resolve a substantial portion of private claims related to the 2010 Gulf of Mexico oil spill. It said the deal it is discussing is in an advanced stage.

"We are working hard to come to a reasonable settlement that will be in the best interest of our shareholders,” CEO Dave Lesar said.

The news came as Halliburton reported an $18 million loss in the first quarter, or 2 cents a share, compared to a profit of $627 million, or 68 cents a share, a year earlier. Gulf operations in the first quarter were impacted by maintenance activity on blowout preventer stacks, executives said. Revenue in the quarter ended March 31 rose to $6.97 billion from $6.87 billion a year earlier.

"With respect to the ongoing Multi-District Litigation trial regarding the Macondo well incident, we have recently participated in court facilitated settlement discussions with the goal of resolving a substantial portion of private claims,” Lesar said.

He added, "Our most recent offer includes both stock and cash, with the cash components payable over an extended period of time.”

The company said the settlement discussions do not cover all possible parties and claims relating to the Macondo incident, and there are additional reasonably possible losses relating to the Macondo incident for which "we cannot reasonably estimate at this time.”

"Putting the issue behind Halliburton would be a good thing, but pricier than we’d thought,” Tudor, Pickering, Holt & Co. analysts Jeff Tillery and Byron Pope said.

The first phase of a civil trial over the oil spill ended last week. Halliburton, which provided the cement for BP’s undersea well that blew out, faces the potential of billions of dollars in punitive damages.

Click here for more information.

Today's Links

Florida Becomes fourth State to Sue BP Over Oil Spill

Nighthawk Commences New Drilling Campaign in Colorado

Texas Fertilizer Plant President Comments on Disaster

Kentucky Plant to Make Fertilizer from Coal Byproducts


Earl’s Pearl of the Day: "Opportunity is rare, and a wise man will never let it go by him.” — Bayard Taylor



April 19, 2013

Committee Endorses Moniz to be Energy Secretary

A Senate committee endorsed President Barack Obama’s nomination of Ernest Moniz to be energy secretary on Thursday, queuing up a possible Senate vote on his confirmation next week.

The Senate Energy and Natural Resources Committee voted 21-1 to approve Moniz, with the only "no” coming from Republican Sen. Tim Scott of South Carolina, who has concerns about proposed spending cuts that would affect a nuclear fuel facility in his home state.

Panel Chairman Ron Wyden (D-Ore.) noted if confirmed, Moniz could be the first secretary of energy who would not "confront energy shortages and scarcity” in the job. Instead, he likely "would oversee an era of abundant carbon-reducing natural gas and dramatic growth of renewable energy technologies.”

Of course, the change in the nation’s energy landscape brings new challenges, including oversight of the hydraulic fracturing process that is key to unlocking natural gas and oil in dense rock formations nationwide and tough decisions on whether to grant wider exports of U.S. fossil fuels.

If confirmed, Moniz would immediately confront the latter issue, as the Energy Department vets 20 applications to export some 26 billion cubic feet per day of natural gas to countries that do not have free trade agreements with the United States.

Sen. Lisa Murkowski (R-Alas.) praised Moniz’s outlook. As energy secretary, "he will focus on an energy policy that is affordable, abundant, clean, diverse and secure,” Murkowski said.

Beyond natural gas exports and drilling safety, Moniz would have to tackle other big issues at the Energy Department, if confirmed, including dealing with questions surrounding the disposal of radioactive waste from nuclear power plants and government loan guarantees for nascent energy technology.

Click here for more information.

Today's Links

Shell Interested in Buying Petrobras Blocks in Gulf of Mexico

Anadarko Makes New Mozambique Gas Find

Feds: Emergency Containment Equipment A Must for Arctic

API: Time to Approve Keystone XL


Earl’s Pearl of the Day: "Time is the most valuable thing a man can spend.” — Theophrastus



April 18, 2013

Explosion Hits Fertilizer Plant North of Waco, Texas

Police say between five to 15 people were killed and more than 160 were injured in a massive explosion at a fertilizer plant near Waco, Texas, late Wednesday.

The explosion at West Fertilizer in downtown West — a community of roughly 2,600 residents about 20 miles north of Waco — happened around 8 p.m. and could be heard as far away as Waxahachie, a town located 45 miles north. It sent flames spiraling high into the evening sky and rained burning embers, shrapnel and debris down on frightened residents.

A member of the city council, Al Vanek, said a four block area around the explosion was "totally decimated.” Other witnesses compared the scene to that of the 1995 Oklahoma City bombing and authorities said the plant made materials similar to that used to fuel the bomb that tore apart that city’s Murrah Federal Building.

The U.S. Geological Survey reported the blast registered a magnitude 2.1, which is comparable to a minor earthquake.

"They are still getting injured folks out and they are evacuating people from their homes,” Waco Police Department Sgt. William Patrick Swanton said early Thursday. He added later: "At some point this will turn into a recovery operation, but at this point, we are still in search and rescue.”

Gov. Rick Perry will hold a press conference on the incident at 11:45 local time, Swanton said. In a statement released Wednesday, Perry said his "thoughts and prayers” were with West residents and first responders.

Swanton said authorities believe between five and 15 people were killed in the blast, but stressed that’s an early estimate as search and rescue operations remain underway. There is no indication the blast was anything other than an industrial accident, he said. At least three firefighters are still missing.

The still-smoldering fire was "somewhat under control” by early Thursday, Swanton said, adding authorities were not concerned about lingering smoke.

The U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) is sending a national response team to the site. ATF spokeswoman Franceska Perot said Thursday the unit includes fire investigators, explosives experts, chemists and canine units.

The town’s volunteer firefighters responded to a call at the plant about 6 p.m., Swanton said. West Mayor Tommy Muska, who is also a volunteer firefighter, was among them and he and his colleagues were working to evacuate the area around the plant when the blast followed about 50 minutes later. Muska said it knocked off his fire helmet and blew out the doors and windows of his nearby home.

The main fire was under control as of 11 p.m., Texas Department of Public Safety spokesman D.L. Wilson said, but residents were urged to remain indoors because of the threat of new explosions or leaks of ammonia from the plant’s ruins.

Lucy Nashed, a spokesman for Gov. Perry’s office, said personnel from several agencies were en route to West or already there, including the Texas Commission for Environmental Quality, the state’s emergency management department and an incident management team. Also responding is the state’s top urban search and rescue team, the state health department and mobile medical units.

The U.S. Chemical Safety Board said it was deploying a large investigation team to West. American Red Cross crews from across Texas also headed to the scene.

Click here for more information.


Today's Links

First Phase of BP Trial Ends, Second Phase to Begin in September

ExxonMobil Chemical Headquarters is on the Market


ConocoPhillips to Increase Alaska production

Official: Australia to Be Largest or Second-Largest LNG Exporter by 2018


Earl’s Pearl of the Day:
"It is not enough to have a good mind. The main thing is to use it well.” — Rene Descartes



April 17, 2013

Alaska, U.S. Team Up for Unconventional Push

The Alaska Department of Natural Resources (DNR) and the U.S. Department of Energy’s Office of Fossil Energy have signed a memorandum of understanding (MOU) to work together — and with potential investors — to study unconventional energy resources in Alaska’s Arctic.

In signing the MOU, DNR commits to helping DOE with its ongoing assessment of unconventional energy resources and DOE’s field evaluation of potential unconventional energy production technologies on the North Slope.

The agreement includes facilitating access to state lands and assisting with permitting and logistical issues, as well as providing expert review and interpretation of scientific data and reports by Division of Oil & Gas and Division of Geological & Geophysical Survey scientists.

"This is a clear example of how the state and the federal government can work together on energy issues that will play a critical role in Alaska’s future,” said DNR Commissioner Dan Sullivan. "As a state, we want to responsibly develop and commercialize all of the North Slope’s energy resources.”

Through its National Energy Technology Laboratory, DOE will have the lead role in developing research and development projects and providing scientific oversight of the field studies.

In the agreement, DOE commits to sharing the available technical data with the State of Alaska.

According to the agreement, Alaska DNR and DOE may also work together to highlight the potential of all of Alaska’s natural resources, including conventional resources such as natural gas, and unconventional resources such as gas hydrates and viscous oil, as important supply sources to meet domestic energy demands and to ensure domestic economic and energy security.

Click here for more information.

Today's Links

Cheniere Sees Financing, Decision on Sabine Pass Units

Republicans Push Bill to Force Keystone XL Approval

Global Impact of North American Shale Gas Boom Forces Qatar to Shift Focus

Group Pushes for More Processing and Refining in Alberta


Earl’s Pearl of the Day: "That which we persist in doing becomes easier, not that the task itself has become easier, but that our ability to perform it has improved.” — Ralph Waldo Emerson



April 16, 2013

Plains All American Announces New Permian Basin Pipeline

Plains All American Pipeline has announced plans to build a 310-mile, 20-inch pipeline to move crude oil across West Texas, capitalizing on the renewed burst of exploration and production in the Permian Basin.

Brad Leone, a spokesman for Plains, said Monday the company has not yet announced a start date for construction of the Cactus Pipeline, but crude oil is expected to begin flowing in the first quarter of 2015.

Plains said its total investment in the project will be as much as $375 million.

The pipeline’s initial capacity will be approximately 200,000 bpd, although that could increase if demand warrants.

"That’s a sizeable quantity,” said John M. White, an analyst with Triple Double Advisors in Houston. "It’s another piece of the West Texas, South Texas, Gulf Coast crude oil infrastructure build out.”

The pipeline will move crude from the Permian to the Plains All American-Enterprise Products Partners Eagle Ford Joint Venture Pipeline, which serves the Three Rivers and Corpus Christi markets.

That venture can also serve the Houston-area market through a connection to the Enterprise South Texas Crude Oil Pipeline, according to the Plains announcement.

White noted as the Permian Basin once again becomes an increasingly prolific source of domestic crude oil production it makes sense to bypass the bottleneck at the traditional terminal at Cushing, Okla.

"Instead, they’re taking it directly to Gardendale in the Eagle Ford,” he said. "This makes much more sense from a cost standpoint and a logistical standpoint.”

From Gardendale, the crude can be shipped to refineries along the Gulf.

Click here for more information.

Today's Links

Forest Oil Partners with Schlumberger on Eagle Ford Development

Freeport LNG May Get U.S. Export Approval in Months

BP Official Says He Wasn’t to Blame for Rig Explosion

Legislation Targets Mandates for Water Recycling in Oil, Gas Industry


Earl’s Pearl of the Day:  "You can’t do anything about the length of your life, but you can do something about its width and depth.” — Evan Esar



April 15, 2013

U.S. Tight Oil Threatens CIS Crude Exports, Russian Academy Says

Crude oil exports from the Commonwealth of Independent States (CIS) may drop 17 percent by 2040 as tight oil production in the United States soars, the Russian Academy of Sciences said in a presentation on its website.

CIS exports will decline to 293 million metric tons in 2040 from 355 million tons in 2010, according to the academy’s base scenario. Russian crude output will fall by as much as 50 million tons annually by 2020 in the report’s "shale breakthrough” scenario, as high costs and the current tax system limit competitiveness on global energy markets.

New drilling technology including hydraulic fracking will transform the United States into the largest crude producer and a net exporter starting around 2020, the International Energy Agency said in November. Russian President Vladimir Putin has called for his country to maintain output at 10 million barrels a day for the next decade. Oil and gas provide about half of the government’s budget revenue.

"Russia is a price taker on the oil market that will export as much as it can,” Ildar Davletshin, a Moscow-based oil and gas analyst at Renaissance Capital Ltd., said. "There is some concern Russia will be left behind as it is still reliant on old technology, and a 10-percent decline in output by 2020 is not unreasonable.”

Russia produced 518 million tons, or 10.4 million barrels a day, of crude and gas condensate in 2012, according to the Energy Ministry.

The CIS includes most former Soviet republics, including oil exporters Russia, Kazakhstan and Azerbaijan.

Click here for more information.

Today's Links

Oil Rigs in U.S. Rise for Third Week, Baker Hughes Says

Alaska Legislature Passes Oil Tax Overhaul

Williams Partners and Shell Form Midstream JV for Marcellus, Utica

Should the U.S. Expand Offshore Oil Drilling?


Earl’s Pearl of the Day: "Every time you subtract negative from your life, you make room for more positive” — Zig Ziglar



April 12, 2013

Louisiana Bill Taps Refineries for Oil Spill Response Fee

A Louisiana lawmaker is proposing a fee on refineries to shore up response funds available to the state in the case of another catastrophic oil spill.

The proposal, House Bill 636, would impose a 25-cent fee on every barrel of crude oil a Louisiana refinery receives for storage or processing to create the state’s Oil Spill Contingency Fund. The fee would be ramped up to a half-cent per barrel if the fund runs low.

The bill, introduced by Rep. Mike Danahay (D–Sulphur) has been referred to the House Ways and Means Committee.

The state oil spill response fund is currently funded with a 4-cent-per-barrel fee on crude transferred from a vessel or marine terminal within the state. The fee only kicks in when the fund balance is below $5 million or in the case of a large spill, and the fund is capped at $30 million.

House Bill 636 would remove the $30 million ceiling and charge a fee at all times. Refineries would pay the higher, half-cent rate when the fund balance is less than $5 million, in the case of a large spill event or if response spending is expected to deplete more than 50 percent of the fund.

The bill also proposes lifting restrictions on ways contingency funds can be spent, including a $750,000 cap on grants for research, testing and development of discharge and blowout prevention as well as improved training.

The Oil Spill Contingency Fund was created in 1995 to clean pollution and remediate natural resource damages in the case of unauthorized discharges of oil.

Click here for more information.

Today's Links

ExxonMobil to Sell Virginia Campus, Shift Work to The Woodlands

Houston: Oil, Gas Boomtown

IEA Cuts World Oil Demand Forecast

FERC Chairman on Gas Pipeline Reviews: We Are Fast But Could Be Faster

Shale Boom Transforming U.S. Industry to Boost BHP, CFO Says


Earl’s Pearl of the Day: "Try to learn something about everything and everything about something.” — Thomas H. Huxley


April 11, 2013

ConocoPhillips Suspends 2014 Alaska Drilling Plans

ConocoPhillips will place on hold its 2014 drilling plans for Alaska’s Chukchi Sea due to the uncertainties of evolving federal regulatory requirements and operational permitting standards.

While the company is confident in its expertise and ability to safely conduct offshore Arctic operations, ConocoPhillips believes it needs more time to ensure all regulatory stakeholders are aligned, said ConocoPhillips Alaska President Trond-Erik Johansen in a statement.

"We welcome the opportunity to work with the federal government and other leaseholders to further define and clarify the requirements for drilling offshore Alaska,” Johansen commented. "Once those requirements are understood, we will reevaluate our Chukchi Sea drilling plans. We believe this is a reasonable and responsible approach given the huge investments required to operate offshore in the Arctic.”

Royal Dutch Shell in February suspended its 2014 offshore Alaska drilling plans, saying it needed more time to ensure the readiness of its equipment and employees for future drilling.

Last month, the U.S. Department of the Interior (DOI) concluded Shell failed to finalize key components of its 2012 Alaska Arctic drilling program. DOI called on the industry and government to collaborate to develop an Arctic-specific model for offshore Alaska oil and gas exploration.

DOI Secretary Ken Salazar said the agency would proceed with ConocoPhillips using the same regime it did with Shell. While the Obama Administration is interested in pursuing Arctic resources, Salazar said they wouldn’t allow shortcuts in terms of requirements, and that exploration would only be carried out with the "utmost safety.”

Click here for more information.

Today's Links

Senate Confirms Sally Jewell as Interior Secretary

Alberta Premier Makes Final Keystone XL Pitch in Washington

Amount of Potential Recoverable U.S. Gas Resources Grows

Lower Summer Gasoline Prices in Forecast

Earl’s Pearl of the Day: "Hope is the pillar that holds up the world. Hope is the dream of a waking man.” — Pliny the Elder



April 10, 2013

Developers Propose Floating LNG Export Plan for Mississippi River

CE FLNG and CE Pipeline asked the Federal Energy Regulatory Commission (FERC) to begin review under the National Environmental Policy Act of their floating natural gas liquefaction and export project on the Mississippi River near Plaquemines Parish, La., which would be capable of producing up to 8 million tons of LNG per year.

The companies, indirect subsidiaries of Cambridge Energy Group, filed their request to initiate the FERC prefiling process on April 1. Under their proposed project schedule, the companies would submit a Natural Gas Act application in October, FERC would give the project a certificate in December 2014 and allow construction to proceed in February 2015, and the companies would put the project in service by February 2018.

The companies proposed to build and operate two purpose built floating liquefaction, storage and offloading units, or FLSOs, that can each produce up to 4 million tons of LNG per year for owners of gas sourced from the United States. Each FLSO would have four liquefaction trains plus storage. The project will require dredging of the Mississippi River to accommodate the delivery of the FLSOs, a berth for the FLSOs and a berth and turning basin for LNG carriers calling on the terminal. The carriers would need to use about 33 miles of the river.

The project also will require an approximately 45-mile pipeline with compressor stations to move the gas from the gas pipeline network to the shore side facilities. The pipeline may need to be extended an additional 27 miles to make a direct connection to the Enterprise Products Partners LP processing plant at Toca in St. Bernard Parish, La., the developers said. The CE companies will own the natural gas or LNG that passes through the terminal.

Click here for more information.

Today's Links

Obama’s Energy Department Nominee Stays Neutral on Natural Gas Exports

BP Executive Says Safety Was Top Priority

Gasoline Cargoes to U.S. Seen Declining as Refinery Output Gains

U.S. Virgin Islands and Hovensa Agree to Refinery Sale Process


Earl’s Pearl of the Day: "The most important thing in communication is hearing what isn’t said.” — Peter Drucker


April 9, 2013

Integrated Management, Planning Needed for Arctic Development

Decisions regarding development and conservation in the Arctic will require an integrated management approach involving the best available science to integrate cultural, environmental and economic factors, according to a recent report by the U.S. Department of the Interior’s (DOI) Alaska Interagency Working Group.

The report – Managing for the Future in a Rapidly Changing Arctic – chronicles how Arctic residents are dealing with rapid, climate change induced impacts on their resources and traditional ways of life, at the same time new economic activity and opportunities in oil and gas, marine transportation, tourism and mining are emerging.

While the report does not recommend new regulations or represent new policy decisions, it does call for a review of activities of more than 20 federal agencies involved in the U.S. Arctic by the end of this year with an eye toward increased coordination and the elimination of duplication of efforts.

"It is imperative we reduce redundancies and streamline federal efforts as we safely and responsibly explore and develop Alaska’s vast resources while preserving the region’s rich ecosystems that will sustain future generations,” said Interior Deputy Secretary David J. Hayes.

DOI also has launched a new government website, the Arctic Science Portal, by the Arctic Research Commission. This website will provide decision makers and other interested parties with easier access to scientific information about the Arctic.

Click here for more information.

Today's Links

Sasol Orders Ethylene Compressor Trains for Lake Charles Cracker

Shell, Gazprom to Develop Arctic Oil Fields

Killing Keystone Seen as Risking More Oil Spills by Rail

Gasoline at U.S. Pumps Drops to Lowest for Season in Three Years

Earl’s Pearl of the Day: "It is a rough road that leads to the heights of greatness.” — Lucius Annaeus Seneca



April 8, 2013

Capacity Added Despite No Construction of New Refineries

It’s a frequently repeated factoid about the energy industry: No new major refinery has been built in this country in decades.

A Valero Energy Corp. plant in Corpus Christi,Texas, often is cited as the last major plant to open — in 1983 — when the San Antonio company built a complex refinery on the site of a simple plant that first opened in 1975.

Since 1983, several small refineries have opened. U.S. Energy Department figures show six plants have come on line since Valero’s big Corpus complex, but none is a major, sophisticated refinery.

More small plants are planned. Construction on a simple, 20,000-bpd plant in North Dakota began last month. Set to open in 20 months, the plant will produce mostly diesel for trucking use within the state, according to a spokesman for one of the owners, MDU Resources Group.

While it’s true no new major refineries have been built in decades, it ignores the fact significant capacity has been added at the nation’s refineries.

A big example is the recent expansion of Motiva Enterprises’ Port Arthur, Texas, refinery, where capacity was boosted by 325,000 bpd, making the plant the nation’s largest at 600,000 bpd.

In 2009, Marathon Petroleum Corp. doubled the capacity of its Garyville, La., plant to 490,000 bpd, making it the nation’s fourth largest.

When experts say no new plant has been built in many years, "they’re talking about no substantial new plants,” said Terrence Higgins, executive director of refining and special studies at energy industry publisher Hart Energy.

The Motiva and Marathon expansions "are not new refineries, but they’re whole new complexes,” Higgins said.

While refinery capacity has fluctuated over the years, as some plants have closed and others have opened, overall it has risen in the past decade.

Nationally, more than 1 million bpd of capacity have been added in the past decade, according to figures from the Energy Information Administration, the statistical arm of the Energy Department.

Click here for more information.

Today's Links

U.S. Court Rules Against BP on Oil Spill Settlement Payments Dispute

Texas Cashes in on Energy

Shell Submits Kitimat Project Plans for Environmental Review

India Seeks Access to U.S. Natural Gas


Earl’s Pearl of the Day: "There’s only one corner of the universe you can be certain of improving, and that’s your own self.” — Aldous Huxley



April 5, 2013

Natural Gas Driving Industrial Development


The significant growth in Louisiana’s petrochemical and chemical industry is being driven by the ample supply of cheap natural gas in the Haynesville Shale in northwest Louisiana, an official with Chesapeake Energy said Thursday.

Kevin McCotter, a vice president of corporate development for Chesapeake who is based in Shreveport, said the Haynesville Shale contains 250 trillion cubic feet of natural gas. One cubic foot of natural gas is about the size of a basketball and provides enough energy to keep a hot water heater running for about an hour and 15 minutes.

"That’s one of the benefits of Haynesville, 250 trillion cubic feet of natural gas, 250 miles straight down a pipeline to the Gulf Coast,” said McCotter, who was one of the speakers at a BIC Alliance State-of-the-Industry seminar held at Ashley Manor. About 100 people attended the seminar, sponsored by BIC Alliance, which has offices in Baton Rouge and Houston and works to connect various industry groups.  

Click here for more information.

Today's Links

BSEE Finishes Final Offshore Workplace Safety Rule

ExxonMobil CEO Zeroes In On Risk


BP Wind Sale Highlights Renewable Energy Struggles


Shell Cleaning Houston Crude Leak


Earl’s Pearl of the Day:  "Believe you can and you're halfway there.” — Theodore Roosevelt


April 3, 2013


Phillips 66 Announces Plans for New Gulf Coast Facility

Phillips 66 announced Tuesday it will pursue building a 100,000-bpd natural gas liquids fractionator in Old Ocean, Texas, near the company’s refinery in Sweeny.

If approved by regulators, construction is expected to begin in early 2014, with start-up expected in the second half of 2015.

The project would create more than 25 full-time jobs and hundreds of temporary construction jobs, the company said in its announcement.

Fractionation is the process of separating natural gas liquids into different components used in various industries, including the manufacturing of plastics for everyday items.

Phillips 66 Chairman and CEO Greg Garland said the company wanted to take advantage of strong existing midstream transportation and storage infrastructure.

"We see excellent market-facing opportunities to grow the natural gas liquids business, and the chance to supply purity NGLs and liquefied petroleum gas to the petrochemical industry and heating markets,” he said.

Phillips 66 was created last year in a split with ConocoPhillips. It includes refining, midstream and chemicals businesses and includes natural gas liquids gathering, long haul transportation, storage and fractionation.

Click here for more information.

Today's Links

TransCanada to Seek Commitments for Oil Pipeline to Eastern Canada

Exxon, BHP Plan World’s Largest Floating LNG Plant Off Australia

Halliburton Defense in Gulf Oil Spill Trial Nearing End

Japan to Study Ice Gas Reserves


Earl’s Pearl of the Day:  "If an idea’s worth having once, it’s worth having twice.” — Tom Stoppard

Don't forget to RSVP for our State-of-the-Industry seminar & Industry Appreciation Crawfish Boil tomorrow in Baton Rouge!




April 2, 2013


CME Exec: Once Marginal U.S. Refineries on the Rebound

New supplies of light sweet crude oils from the Bakken, Eagle Ford and Midcontinent are injecting new life into U.S. refineries whose fate until recently was bleak, according to a top executive with the derivatives and futures exchange CME Group.

"I think it’s really going to change the way refiners run,” said Gary Morsches, New York-based managing director of global energy with CME Group.

Greater access to domestically produced light sweet crudes compatible with the WTI benchmark has dramatically improved the economic viability of smaller, less complex refineries, Morsches explained at the North American Crude Marketing Conference in Houston. Moreover, he expressed optimism that the long-term outlook for these facilities is positive.

Pipeline projects such as TransCanada’s Keystone Southern Extension and Enterprise and Enbridge’s joint Seaway Pipeline Reversal and Expansion, together with continually expanding crude by rail capacity, should deliver more than 2 million bpd of Bakken and Midcontinent crude to the Gulf Coast by 2014. Bakken crude also is increasingly making its way to East Coast refineries via rail and barge, lessening the need to import more expensive Brent crude into the region.

"That’s very significant,” said Morsches. "Now refiners have access to crude slates, crude quality they have not had very good access to and it’s changing the way refiners are running, changing the crude slates refiners are choosing to run with, changing the output of those refineries, but these changes are not that hard to achieve.”

Although less complex refineries already have the distillation, reforming and catalytic cracking capacities necessary to run light crudes, Morsches expects these facilities to take steps to optimize their increasingly strong competitive position via capital projects. He predicted debottlenecking will be "in vogue” as simpler refineries seek to run higher throughputs of light crudes and produce more high-value products.

Click here for more information.

Today's Links

Planned Work Completed at LyondellBasell’s Houston Refinery

Kinder Morgan Providing Storage Facilities for New Methanol Plant

Apache Confirms 14 Blocks from Gulf of Mexico Lease Sale

Three Years after Gulf Spill, BP Faces Big Week in Court


Earl’s Pearl of the Day: "The purpose of life is a life of purpose.” — Robert Byrne



April 1, 2013

New Refineries Planned for Bakken Shale

Crude oil production in North Dakota’s Bakken Shale continues to grow at a faster pace than the pipelines and railcars needed to move the crude to large national refineries. That has led to some companies building small refineries in North Dakota, trying to take advantage of the low cost of Bakken crude and a growing demand for fuel in the local area.

The first of three new refineries in the works is the 20,000-bpd Dakota Prairie refinery, which broke ground last week. Its owners, a joint venture between MDU Resources Group and Calumet Specialty Products Construction, estimate construction will be completed within the next two years.

"Through this joint venture we are continuing to expand both our midstream energy business and our vertically integrated investment in the Bakken oil play,” said David L. Goodin, president and chief executive officer of MDU Resources. "There is a strong existing market for the plant’s production.”

Dakota Oil Processing plans to spend $200 million to build and start-up a second refinery, the Trenton Diesel Refinery, which will also have a 20,000-bpd capacity. It has received an air quality permit and the project is under planning, but no start-up date has been announced.

There is also a third refinery being planned by three affiliated tribes — the Mandan, Hidatsa and Arikara Nation — according to Hart Energy Research’s North American Shale Quarterly Service. Construction for the refinery, the Thunder Butte Petroleum Services, is scheduled to begin in the spring of this year and will have a capacity of 20,000 bpd when completed.

These three refineries are some of the first to be built in the United States in the past decades. The projects fly in the face of conventional refining wisdom, which counsels refineries can only be profitable if they are large enough to achieve economies of scale.

North Dakota’s currently lone refinery, the Tesoro Mandan refinery, has a capacity of 60,000 bpd and can process diesel fuel, jet fuel, heavy fuel oils and liquefied petroleum gas. It is located near Bismark.

The two new refineries will focus on creating the diesel and kerosene that are needed locally.

Click here for more information.

Today's Links

Anadarko’s Plant Nears Completion

Suncor Goes Direct to Refiners for Profit Boost

Natural Gas Begins to Flow from Israel’s Tamar Field

Study Touts Job Creation Benefits of Shipping Oil Sands as Heavy Crude


Earl’s Pearl of the Day: "Make the most of yourself, for that is all there is of you.” — Ralph Waldo Emerson



March 28, 2013

Magnolia LNG Asks FERC to Begin Early Review of Export Project

Magnolia LNG submitted to FERC’s prefiling process its plans for a $2.2 billion natural gas liquefaction and export terminal in the Port of Lake Charles, La.

Magnolia filed a March 12 request to begin early review under the National Environmental Policy Act. The company proposed not only to build the four train Magnolia Liquefied Natural Gas Project for overseas LNG export but also to operate LNG carriers and barges for domestic marine distribution and possible LNG bunkering, and to operate LNG trucks for over-the-road distribution to refueling stations in Louisiana and surrounding states.

In January, Magnolia and Louisiana Gov. Bobby Jindal introduced the plans to develop the project, which they said might eventually expand to produce 8 million metric tons of LNG annually. The developer announced in early March it had signed an exclusive lease option agreement with the Lake Charles Harbor and Terminal District Authority to secure the project site.

Under the proposed schedule included in the prefiling request, Magnolia planned to file a Natural Gas Act Section 3 application for the project by Nov. 1, receive its FERC certificate in December 2014, begin construction in March 2015 and put the project in service in October 2017.

"Magnolia will operate the LNG facility using a tolling structure,” the company told FERC. "At this time, Magnolia anticipates it will not own the natural gas or the LNG that passes through the terminal. However, Magnolia will inform the commission if it plans to acquire and/or take title to any natural gas that is transported to or liquefied in the LNG facility at a future date.”

Click here for more information.

Today's Links

U.S. Shale Boom: Downstream Picture Starts to Emerge

Shell Facing New Probe over Alaska Drilling

Greenland ‘reluctant’ on New Offshore Drilling

API Official Chosen to Lead America’s Natural Gas Alliance


Earl’s Pearl of the Day: "If you want change, you have to make it. If we want progress, we have to drive it.” — Susan Rice


March 26, 2013

Macondo Rig Fire was ‘Too Big to Fight’

The officer in charge of safety on Transocean’s Deepwater Horizon drilling rig said the post-blowout fire was too big to fight and the evacuation saved lives.

In the fifth week of a trial to apportion blame among BP, Transocean Ltd. and other contractors for the Macondo oil well disaster, David Young, the rig’s chief mate, said the captain told him to do whatever he needed to do to get the fire on April 20, 2010 under control.

"I pulled him outside and showed him the size of the fire we were dealing with and ... basically told him we couldn’t fight that fire,” Young said on Monday in a New Orleans federal court before U.S. District Judge Carl Barbier.

Young then helped load injured and other crew into lifeboats and rafts before jumping into a raft himself, he said. Later, he and others in his raft were pulled onto one of the lifeboats.

"Do you believe the Deepwater Horizon’s emergency training saved lives that night?” Transocean attorney Luis Li asked.

"I do, because we got 115 people off,” Young replied.

Eleven workers died as a result of the blowout and fire, and more than 4 million barrels of oil gushed into the Gulf from the damaged well. BP and its contractors are being sued by the U.S. Justice Department along with the Gulf states, companies and individuals affected.

Transocean’s chief executive testified last week his workers made mistakes that day, but were not responsible for overall safety at the site. While BP accepts its role in the accident, it believes Transocean and well cementing provider Halliburton share the blame.

Transocean has pleaded guilty to federal charges connected with Clean Water Act violations and agreed to pay $1.4 billion in criminal and civil fines and penalties.

Transocean is expected to call its final witnesses on Tuesday, beginning with Bill Ambrose, Transocean’s director of special projects. Other defendants then will begin calling their witnesses.

Click here for more information.


Today's Links

Chevron Announces Oil Discovery in Deepwater U.S. Gulf of Mexico

ACC’s Dooley Predicts Chemical Boost for Mountain State

New Beaumont Terminal to Carry Crude to Gulf Coast Refiners

Two Miles of Sea Covers Big Oil’s Next Generation Field



Earl’s Pearl of the Day: "Always tell the truth. Then you’ll never have to remember what you said the last time.” — Sam Rayburn



March 25, 2013

Cyberattack Risk High of Oil and Gas Industry

In the months since a virus ripped through 30,000 of Saudi Aramco’s computers, the world’s largest oil company has become the canary of the industry, warning others of the serious threats already lurking on their systems.

Although the attack did not disrupt Saudi Aramco’s oil and gas operations, the company’s top man warned in a recent interview the risk to the industry remains high.

Chief Executive Officer Khalid Al-Falih said despite aggressive efforts by Saudi Aramco and others to guard against online threats, operations throughout the energy industry will remain in danger unless all companies adopt strong Internet security measures.

"What happens to one company affects us all,” Al-Falih said.

Saudi Aramco, which is wholly owned by the Kingdom of Saudi Arabia, produces more hydrocarbons than ExxonMobil, Chevron and BP combined.

But even though the mammoth energy company has increased its focus on Internet security, it continues to deal with a high volume of threats, Al-Falih said.

"Every company today you talk to will tell you they are being tested every day by hackers,” Al-Falih said. "So it’s nothing new for us. We have been attacked hundreds of thousands of times before this attack penetrated us.”

While Saudi Aramco’s security measures have protected it from any interruption in its oil production, delivery or other fundamental operations, companies with less robust cybersecurity efforts may be at greater risk, he said. And that presents a threat to other oil and gas companies, Al-Falih said.

"We provide our petroleum to systems that are run by other companies,” he said. "So in an extreme case, if refineries are hacked and disrupted, that will impact demand on us and our petroleum. And the reputation of the industry as a whole is important to us.”

Oil companies use computer systems to manage and control massive operations, and to monitor them for safety. A computer infection on one of those control systems could cause a company’s entire operation to malfunction.

Click here for more information.

Today's Links

Centrica Signs Deal for U.S. Gas Imports

Shell Executive Managing Arctic Alaska Oil Program to Leave Company

Russia Lets China into Arctic Oil Rush as Energy Giants Embrace

Salazar Finalizes Oil Shale Plan; BLM Proposes Revisions

Earl’s Pearl of the Day: "Self-confidence is the first requisite to great undertakings.” — Samuel Johnson


March 22, 2013

BP Seeks Sanctions Against Halliburton in Spill Trial

British oil giant BP and the state of Alabama want sanctions against Halliburton in the civil trial over the 2010 Gulf of Mexico oil spill, for not turning over for nearly three years cement samples that may have been used with the well that blew out.

Attorneys for BP and Alabama told U.S. District Judge Carl Barbier in New Orleans on Thursday they would be filing motions for sanctions. BP filed its motion Thursday night. Alabama’s motion was expected to follow.

"Halliburton’s conduct has undermined the integrity of these proceedings and severely prejudiced BP and the other parties,” BP said in its motion.

Possible sanctions could include preventing Halliburton from using certain defenses at the trial, which could make it harder for the company to challenge a finding of gross negligence. Such a finding would allow punitive damages against the company for the worst offshore oil spill in U.S. history.

Among other things, BP said in its filing it wants the court to order that Halliburton’s final cement design was unstable and caused hydrocarbons to enter the well.

According to lawyers who were in court, Halliburton attorney Don Godwin told Barbier he would like an opportunity to respond to the motions once he reads them, and Barbier said he could.

Godwin said, "We’ll aggressively defend as it has no merit. BP is attempting to deflect attention from itself. Halliburton will not be intimidated by BP for things it did not do.”

Last week, Godwin acknowledged officials recently discovered cement samples possibly tied to the ill-fated drilling project weren’t turned over to the Justice Department after the oil spill.

Also, a former Halliburton lab manager testified Tuesday a company official asked him not to record results of a cement stability test related to BP’s blown out Macondo well.

The test was conducted shortly after the spill, using ingredients similar to those used to seal the undersea well that blew out. Timothy Quirk said he told the results to the company official that asked for the test, then he threw away his notes.

BP said in its motion Thursday any testing of the samples recently found could be difficult because they would likely have deteriorated given the amount of time that has passed.

BP also wants the court to order the test Quirk performed, the notes of which were destroyed, further establishes the cement used on the Macondo well was not stable.

Barbier already has refused to drop gross negligence claims against Halliburton, BP and Transocean at this stage in the trial. He did dismiss gross negligence claims Wednesday against two lesser players in the trial, M-I Swaco and Cameron.

Click here for more information.

Today's Links

Rosneft Becomes World's Largest Listed Oil Producer with Completion of Deal

Alaska Senate Approves Cut on Oil Taxes

API: U.S. February Oil Use Down 4.1% Versus Year Earlier

Baker Hughes Builds New Training Center for Rig Workers

Earl’s Pearl of the Day: "Life will always be to a large extent what we ourselves make it.” — Samuel Smiles



March 21, 2013

Oil Companies Bid $1.6 Billion for Gulf Drilling Rights

Dozens of companies offered up $1.6 billion for the rights to drill in the central Gulf of Mexico during a government lease sale Wednesday that affirmed a drilling revival in the region and the industry’s interest in tapping ever deeper territory.

All told, 52 oil and gas companies submitted 407 bids on 320 blocks, with high bids totaling $1.2 billion.

Tommy Beaudreau, the director of the Bureau of Ocean Energy Management that conducted the auction, called it an "extremely successful and an extremely robust sale.” And bureau officials said it ranked as the sixth highest grossing central Gulf auctions since area wide leasing began decades ago.

"It serves as a reminder the Gulf of Mexico, and, in particular, the deepwater Gulf, will continue to play a major role in future energy development in the country,” Beaudreau said. "The Gulf of Mexico remains one of the cornerstones of the United States’ domestic energy portfolio and it will stay that way for many, many years to come.”

In opening the sale at the Mercedes-Benz Superdome in New Orleans, outgoing Interior Secretary Ken Salazar said the auction was a sign Gulf drilling is going strong, nearly three years after the BP oil spill devastated the region.

He praised the oil industry for making strides to improve safety in the wake of the spill.

"People of industry stood up and said ‘we are going to get it right,’ and we are getting it right,” Salazar said.

As the auction got under way, officials with the Bureau of Ocean Energy Management opened the submitted bids and read them aloud, sometimes in a dry monotone that belied the millions of dollars at stake.

Most of the interest was concentrated in the Walker Ridge area of the Gulf, where at least six companies are vying for some 24 tracts. Chevron and Statoil recently have announced promising discoveries there.

The sale’s highest bid — $81.8 million offered by Statoil and Samson — was for Walker Ridge block 271.

Industry representatives and analysts had anticipated the sale would mark a return to more normal conditions that existed before the 2010 Gulf oil spill prompted the cancellation of lease sales. The first central and western Gulf sales after the spill were blockbusters, driven by pent-up demand.

Chris John, president of the Louisiana Mid-Continent Oil and Gas Association, said the bid totals "clearly demonstrate that industry remains committed to doing business in the Gulf of Mexico.”

Click here for more information.

Today's Links

BP Declines to Bid on New Gulf Drill Leases

Phillips 66 Signs Three Pacts to Raise Supplies of North American Crude Oil

Groups Praise Revenue Sharing Bill, Call for More Access to U.S. Acreage

Rigs-to-Reefs Program Making a Splash in Texas

Earl’s Pearl of the Day: "Just because something doesn't do what you planned it to do doesn't mean it's useless.” — Thomas A. Edison


March 20, 2013

Bidding Begins in Gulf Drilling Lease Sale

The federal government is kicking off an auction of leases to drill in the Central Gulf of Mexico today, but it probably won’t look much like last year’s sale of similar territory, when pent-up, post-spill demand spurred a buying frenzy.

Instead, this time, industry leaders and analysts expect a return to more normal patterns as major oil companies and new players stake out territory in the Gulf for years to come.

"This is hopefully a back-to-normal central sale,” said Randall Luthi, head of the National Ocean Industries Association. As such, "it will be a pretty accurate barometer” of the oil industry’s continued interest in the Gulf of Mexico.

During the last Central Gulf lease sale in June, energy companies offered more than $1.7 billion in high bids for more than 2.4 million acres. The high demand for offshore acreage was fed in part by the cancellation of a previously planned Central Gulf sale after the 2010 oil spill, Luthi noted.

This time around, nearly four dozen companies submitted 407 bids on 320 offshore blocks to the Interior Department’s Bureau of Ocean Energy Management. The bids will be unveiled when the auction gets underway at 9 a.m. at the Mercedes-Benz Superdome in New Orleans.

The area up for grabs encompasses 7,299 blocks spanning 38.6 million acres, though interest may be focused on the 306 blocks that are being made available for the first time in years. The territory is newly available because previous leases have been relinquished, terminated or expired since the last central sale.

The available acreage includes shallow tracts just nine feet deep as well as far deeper territory in more than 11,115 feet.

Click here for more information.

Today's Links

Mexico Considers Opening Waters to International Oil Firms

Plaintiffs to Formally Rest Case in Gulf Oil Spill Trial

Alberta Government Buys ‘The New York Times’ Ad Promoting Keystone XL


Gulf Coast Oils Surge as U.S. Refinery Turnarounds Near End


Earl’s Pearl of the Day: "I don’t measure a man’s success by how high he climbs but how high he bounces when he hits bottom.” — George S. Patton


March 19, 2013

Transocean CEO Takes Witness Stand in Gulf Oil Spill Trial

The chief executive officer of Swiss drilling contractor Transocean is set to take the witness stand today in the civil trial over the 2010 Gulf of Mexico oil spill.

Steve Newman will be questioned under oath about the seaworthiness of the Deepwater Horizon drilling rig and the competency of its crew before the fateful explosion off the coast of Louisiana that killed 11 workers. The resulting oil spill was the worst offshore spill in U.S. history.

Newman has defended the company’s actions in previous statements and public settings. He told the Senate Committee on Energy and Natural Resources on May 11, 2010 that nothing is more important to the company than safety.

And while he didn’t want to speculate at the time on the exact cause of the explosion and oil spill, Newman said he believed it was important to point out the roles of the various parties involved in the operation.

Newman noted at the hearing BP was the operator of the well and Halliburton provided the cement for the well.

"The one thing we know with certainty is on the evening of April 20, there was a sudden, catastrophic failure of the cement, the casing, or both,” Newman said. "Therein lies the root cause of this occurrence; without a disastrous failure of one of those elements, the explosion could not have occurred. It is also clear the drill crew had very little, if any, time to react.”

Newman also defended his firm’s maintenance of the rig’s blowout preventer, which failed to stop the flow of oil to the sea.

"Some have suggested the blowout preventers used on this project were the cause of the accident. That simply makes no sense,” Newman said.

Nine of the 11 men killed on the rig worked for Transocean. The other two worked for M-I Swaco, a unit of oilfield services firm Schlumberger.

Click here for more information.

Today's Links

Valero Restarts Idled Ethanol Plants

Refiners Hear the Good and the Bad on Fossil Fuels

Saudi Arabia to Drill for Shale Gas This Year


Onshore Services Work Gains Steam

Earl’s Pearl of the Day:  "Love is, above all else, the gift of oneself.” — Jean Anouilh


March 18, 2013

BP Seeks To Block Gulf Spill Settlement Payments

BP sued Friday to block what could be billions of dollars in settlement payouts to businesses over the 2010 Gulf of Mexico oil spill.

The London-based oil giant accused the court appointed administrator for the settlement, Patrick Juneau, of trying to rewrite the terms of the deal. BP said Juneau violated the settlement in the way he used a complex formula to determine the payments to businesses.

"Although the ultimate exposure is at this time inestimable, it grows daily and could cost BP billions,” the company’s lawyers wrote Friday.

U.S. District Judge Carl Barbier appointed Juneau and has upheld his decisions for calculating payments. Juneau’s spokesman declined to comment on BP’s lawsuit.

Attorneys who worked on the class action settlement with BP said the payments to businesses were spelled out in the agreement.

"Simply put, BP undervalued the settlement and underestimated the number of people and businesses that qualify under the objective formulas BP agreed to,” attorneys Steve Herman and Jim Roy said in a statement.

Friday’s court filing asked Barbier to block payments to any businesses whose awards are part of the January decisions. As an alternative, BP asked to block payments to businesses in certain industries, including agriculture, construction, professional services, real estate, manufacturing and retail.

BP estimated a year ago it would spend roughly $7.8 billion to resolve tens of thousands of claims covered by the settlement. It revised its estimate earlier this year, saying it expected to pay $8.5 billion, but now says it can’t give a reliable estimate.

Click here for more information.

Today's Links

Statoil, Exxon Make Third ‘High-Impact’ Gas Find off Tanzania

Energy Boom Helps Fuel West Texas, Great Plains Population Growth

Days of Promise Fade for Ethanol

Job Safety Analysis — Meeting New Requirements for Training


Earl’s Pearl of the Day: "We may go to the moon, but that’s not very far. The greatest distance we have to cover still lies within us.” — Charles de Gaulle


March 15, 2013

Arctic-Specific Rules Required After Shell’s 2012 Mishaps

Royal Dutch Shell was blasted by the U.S. government for the series of mishaps that dogged its attempts to explore for oil in the Arctic, and ordered to file detailed plans before it can resume those efforts.

An Interior Department review of Shell’s exploration off the north coast of Alaska in 2012, which was released yesterday, found shortcomings in oversight of its various contractors and said the company started its work "not fully prepared” for the challenges it faced.

Interior Secretary Ken Salazar ordered the staff review of Shell’s 2012 experience in January. The company had already announced a pause in its Arctic operations due to equipment repairs that forced it to skip this year’s drilling season.

"Before Shell is allowed to move forward, they are going to have to demonstrate to us they have a comprehensive management plan in place,” Salazar said.

Interior, which regulates offshore drilling, will require the company to provide a detailed plan of both its drilling and transport operations. The plan must include how it will manage contractors, who contributed to Shell’s woes. It will also need third-party approval of that plan, Salazar said.

"The traditional operator-specific, ‘go it alone’ model common with exploration programs in other regions is not appropriate for Arctic offshore operations,” the Interior Department report said.

Shell will "apply lessons learned” from the Interior report along with a separate Coast Guard investigation and its own assessment to bolster its offshore program, Curtis Smith, a company spokesman in Alaska, said.

"Alaska remains a high potential area over the long term, and we remain committed to drilling there safely again,” Smith said.

Two ships Shell was using in the Beaufort and Chukchi seas were being towed to Asia for repairs, meaning it will miss any chance to resume drilling in 2013. The company never got a U.S. permit last year to tap an oil reservoir off Alaska’s north coast because of issues with a spill containment system, though it was allowed to conduct preliminary drilling. Shell also encountered weather delays and was cited for violating air pollution standards.

Click here for more information.

Today's Links

Flight Restrictions Due to Gulf Fireball

ExxonMobil Unveils Its U.S. Energy Outlook

BP Allowed to Bid in Gulf Lease Sale

Transocean Maintenance Showed Negligence, Engineer Says

Earl’s Pearl of the Day: "Blessed is he who expects nothing, for he shall never be disappointed.” — Alexander Pope




March 14, 2013

La. Pipeline Blaze Could Burn Until Today

A fire raging in a coastal Louisiana bayou where a tugboat struck a gas pipeline appeared to have diminished Wednesday night but is far from extinguished, the Coast Guard said.

Smoke was still visible in New Orleans, 30 miles to the north, and officials say they don’t expect the fire sparked by Tuesday night’s crash to be out until today or later.

It started when a tug pushing an oil barge struck a liquefied natural gas pipeline in shallow Bayou Perot, where Lafourche and Jefferson parishes meet. Four people were injured, one critically.

No oil had spilled as of Wednesday evening and what appeared to be pockets of oil on the water turned out to be ash from the burned gas, the Coast Guard said.

At a news conference, Capt. Jonathan Burton stressed the barge remained intact and none of the oil appeared to be leaking. However, as a precaution, protective boom was deployed in the area around the site and in nearby environmentally sensitive areas. Oil skimmers were also dispatched.

"We’re not waiting for something to happen,” Burton said. Preparations included consulting with the National Oceanic and Atmospheric Administration on where currents might take the oil if it were released.

Burton said investigators hadn’t determined why the tug, owned by Settoon Towing, hit the pipeline. The Coast Guard estimated water at the site to be 2 or 3 feet deep.

Asked specifically if the tug, the Shanon E. Settoon, was outside navigation channels, Burton would only say the accident was under investigation.

Click here for more information.

Today's Links

Worker: Rig Was Bustling Before BP Well Blowout

LyondellBasell Details Ethylene Boost at Corpus Christi, Plans PE Unit

Enterprise Products Partners Considers Building Ethane Pipeline

U.S. Oil, Gas Production to Climb While U.S. Energy Consumption Declines


Earl’s Pearl of the Day:"You may be disappointed if you fail, but you are doomed if you don’t try.” — Beverly Sills

A reminder to RSVP for the BIC Crawfish Boil in Kemah! We're one week away & we look forward to seeing you there!



March 13, 2013


CHS Plans to Boost McPherson, Kan., Refinery Production

A planned $327 million expansion will boost refining capacity by 18 percent at the National Cooperative Refinery Association facility at McPherson, Kan., CHS Inc., an energy, grains and foods business and the nation’s leading farmer-owned cooperative, announced Tuesday.

The multifaceted project, which will begin this spring, will boost refining capacity to 100,000 bpd from the facility’s current 85,000 bpd. Completion will take place in phases during the second half of calendar year 2015 and the first months of 2016, with production coming on line in early 2016.

The expansion project will take place concurrent with construction of a $555 million replacement coker already in progress. The McPherson refinery will continue to operate normally during both construction projects.

"Investing in additional refining capacity at McPherson is further evidence of our commitment to expanding our energy platform to add value for our owners and customers while becoming the premier marketer of refined fuels to rural America,” said Jay Debertin, CHS executive vice president and chief executive officer, Energy and Foods.

Debertin added the additional refined fuels gallons produced will allow CHS to better match production from McPherson and its 55,000-bpd refinery at Laurel, Mont., with customer demand. "The added refinery production will be equally divided between diesel and gasoline to best meet our customers’ agricultural needs in rural America,” he said.

Click here for more information.

Today's Links

IEA Sees Weaker Oil Demand Growth, More Supply


Oil Drillers Boost Efforts to Coax More From Shale

Keystone PR Battle Ramps Up

Oil Industry Labor Shortage Affecting Safety, Report Says


Earl’s Pearl of the Day:"If you can find a path with no obstacles, it probably doesn’t lead anywhere.” — Frank A. Clark




March 12, 2013

Japan Achieves First Gas Extraction from Offshore Methane Hydrate

A Japanese energy explorer said Tuesday it extracted gas from offshore methane hydrate deposits for the first time in the world, as part of an attempt to achieve commercial production within six years.

Since 2001, Japan, which imports nearly all of its energy needs, has invested several hundred million dollars in developing technology to tap methane hydrate reserves off its coast that are estimated to be equal to about 11 years of gas consumption.

State-run Japan Oil, Gas and Metals National Corp., (JOGMEC) said the gas was tapped from deposits of methane hydrate, a frozen gas known as "flammable ice,” near Japan’s central coast.

Japan is the world’s top importer of LNG and the lure of domestic gas resources has become greater since the Fukushima nuclear crisis two years ago triggered a shake-up of the country’s energy sector.

Japan’s trade ministry said the production tests will continue for about two weeks, followed by analysis on how much gas was produced.

Methane is a major component of natural gas and governments including Canada, the United States, Norway and China are also looking at exploiting hydrate deposits as an alternative source of energy.

Japan used depressurization to turn methane hydrate to methane gas, a process thought by the government to be more effective than using the hot water circulation method the country had tested successfully in 2002.

Click here for more information.

Today's Links

With or Without Keystone Pipeline, Oil Will Roll into U.S.

Halliburton Exec Testifies at Gulf Spill Trial

Hanwha Eyes U.S. Ethylene Plant

Innovative Oil Field Equipment and Strategies are Reshaping Industry

Earl’s Pearl of the Day:"Most folks are about as happy as they make up their minds to be.” — Abraham Lincoln

BIC Alliance is proud to announce our involvement with "The Boot Campaign." This charity helps our armed forces veterans upon their return home. We have purchased a pair of boots and a t-shirt for each of our employees and we hope you will join us in getting your boots on!

Click here to learn more about The Boot Campaign.


March 11, 2013

State Department Releases Draft SEIS for Revised Keystone XL

The U.S. Department of State released a draft supplemental environmental impact statement (SEIS) for the proposed Keystone XL crude oil pipeline’s new presidential permit application.

The SEIS includes a comprehensive review of the pipeline’s new proposed route across Nebraska, new information and circumstances on its largely unchanged route across Montana and South Dakota, and expanded and updated information that was not included in the project’s original final EIS in 2011, officials said.

It makes no recommendations on whether the project’s new cross-border permit application should be approved or denied, they emphasized.

TransCanada Corp., the project’s sponsor, noted while it is still reviewing the draft SEIS, the document builds on more than 10,000 pages of already completed reviews and reaffirms "there would be no significant impacts to most resources along the proposed project route.”

TransCanada Chief Executive Russ Girling said, "Completing the draft SEIS for Keystone XL is an important step toward receiving a presidential permit for this critical energy infrastructure project. No one has a stronger interest than TransCanada does in making sure Keystone XL operates safely, and more than four years of exhaustive study and environmental review show the care and attention we have placed on ensuring this is the safest oil pipeline built to date in the United States.”

Karen A. Harbert, president of the U.S. Chamber of Commerce’s Institute for 21st Energy, said the draft SEIS for the project’s new cross-border permit application was long overdue, and continues to build a strong case for Keystone XL’s construction. "We’ll be working over the next 45 days to ensure the voice of the majority of American people, who favor this project, is heard loud and clear by the Obama Administration,” she said.

Click here for more information.

Today's Links

Obama Confers With Energy, Oil Executives on Second-Term Agenda


Russian Arctic Set to Become the New Frontier

Security Threats a Certainty on Energy Networks, ex-CIA Head Says

OTC Announces Technology Awards

BIC Alliance is proud to announce our involvement with "The Boot Campaign." This charity helps our armed forces veterans upon their return home. We have purchased a pair of boots and a t-shirt for each of our employees and we hope you will join us in getting your boots on!

Click here to learn more about The Boot Campaign.

Earl’s Pearl of the Day:"If you don’t make mistakes, you’re not working on hard enough problems. And that’s a big mistake.” — Frank Wilczek



March 8, 2013

Bill Gates Urges Government to Spend More on Energy R&D

Microsoft Chairman and Co-Founder Bill Gates urged the U.S. government and other countries on Thursday to spend more money on energy research and development (R&D) as a catalyst to innovation he believes will bring more options to people around the world.

"It’s an incredible travesty that we’re spending so little,” Gates, a billionaire philanthropist, said during a question and answer session at the IHS CERAWeek industry event in Houston.

He said the shortfall in government spending is a pitfall of capitalism.

"It’s always pretty stunning how low the energy (research and development) number is,” he said, adding, "We should put a lot more into basic research.”

Gates said some money is being spent on energy R&D but largely outside of government.

"I think it’s fantastic for the world that this venture capital ... is focused on energy,” he said.

Gates said with energy innovation comes risk, and when it comes to meeting the world’s energy needs, he believes more efforts are worth the risk.

"It’s an incredibly daunting field,” Gates said. "There are going to be a lot of failures.”

Click here for more information.

Today's Links

Katoen Natie to Build Petchem Storage, Processing Facility in La.

Statoil ‘Gets Cold Feet’ Off Alaska

Valero Refinery Revived on Eagle Ford Crude


Oil, Gas Industry Seeks to Address New Face of Risk


Earl’s Pearl of the Day:"Speak when you are angry — and you will make the best speech you’ll ever regret.” — Laurence J. Peter


March 7, 2013

GM’s Akerson Calls for National Energy Policy

The head of General Motors (GM) called Wednesday for President Obama to create a national panel to craft a long-term energy policy, built on the nation’s newfound bounty of natural gas and tight oil.

Daniel Akerson, who has served as GM’s chairman and CEO since 2010, also said his company is building more natural gas vehicles — including those that can run on either compressed natural gas or gasoline until the alternative fuel is more widely available — in order to take advantage of the cleaner burning fuel.

Akerson spoke Wednesday to delegates at the IHS CERAWeek energy conference, and his call for a long-term national energy policy echoed that of other executives, who said their companies are reluctant to invest in multibillion-dollar infrastructure projects without some assurance of where the country is headed.

"Everywhere you look, there’s an opportunity to seize the energy high ground,” he said.

He suggested a "blue-ribbon commission” made up of energy producers and consumers, asked to develop a plan to improve the nation’s standard of living by extending the national shale gas and tight oil "dividend.”

That would include affordable energy, cleaner air and water, and a lower trade deficit, he said.

Click here for more information.


Today's Links

BP, Transocean Officials Botched Tests, Witness Testifies

Exxon to Invest $190 Billion Over Next 5 Years on New Resource Opportunities

Dearth of Skilled Workers Imperils $100 Billion Projects

U.S. Interests in Middle East Remain Despite Shale Revolution


Earl’s Pearl of the Day:"If you want others to be happy, practice compassion. If you want to be happy, practice compassion.” — The Dalai Lama



March 6, 2013

ExxonMobil Plans Multibillion-dollar Baytown Plant Expansion

ExxonMobil is expanding the capacity of its Baytown complex to boost its capacity for turning natural gas into petrochemical building blocks, a multibillion-dollar upgrade the company believes makes sense even if gas prices rise from lows that have driven a manufacturing surge.

Irving-based ExxonMobil is the largest U.S. producer of natural gas and plans to leverage its bounty into a huge expansion of its petrochemical facilities in the Gulf Coast, including the new steam cracking capacity at its Baytown plant. It did not put a precise price tag on the work.

When the permits are approved, construction of the plant will take about three years, and ExxonMobil says the plant could be up and running by the end of 2016.

"The project is going to be an expansion of our Baytown project, which is already the largest integrated refining complex in the country,” said Steve Pryor, president of ExxonMobil Chemical Co. "It builds on our strengths as an integrated petrochemical company and will take advantage of all the shale gas that is coming on.”

The expansion will increase the Baytown plant’s capacity to convert ethane, a natural gas liquid, into the chemical building block ethylene, and from that to produce the plastic polyethylene.

Pryor said the expanded plant will have features that will keep it economically competitive, even if the price of natural gas rises.

Click here for more information.

Today's Links

U.S. Becomes World’s Biggest Fuel Producer

U.S. Keystone Decision May Delay TransCanada Six Months

Best Practices for Oil, Gas Water Management Still Evolving

After Chįvez, a Question of His Country’s Oil


Earl’s Pearl of the Day:"Nothing can bring you peace but yourself.” — Ralph Waldo Emerson



March 5, 2013

Shell to Build LNG Plants in U.S., Canada for Transport Fuel

Royal Dutch Shell said it will build two small-scale gas liquefaction units in Louisiana and Ontario as part of an investment plan to unlock value in the use of LNG as a transport fuel.

"These two units will form the basis of two new LNG transport corridors in the Great Lakes and Gulf Coast regions,” Shell said in a statement on Tuesday.

Shell, which has bet the most heavily of all the top oil firms on a future for cleaner-burning natural gas, said it is using its expertise to make LNG a viable fuel option for the commercial market.

In the Gulf Coast corridor, Shell plans to install the liquefaction unit at its Geismar Chemicals facility to supply LNG along the Mississippi river and intra-coastal waterway and to exploration areas offshore in the Gulf of Mexico and onshore in Texas and Louisiana.

Shell plans to build the liquefaction unit at its Sarnia Manufacturing Center for the Great Lakes corridor. This project will supply LNG fuel to all five Great Lakes, their bordering U.S. states and Canadian provinces, and the St. Lawrence Seaway.

Each unit will be able to produce 250,000 tons of LNG, Shell said.

The two liquefaction units are expected to begin operations and production in about three years after final regulatory permission.

Click here for more information.


Today's Links

Chemical Industry Surging on U.S. Gas


BP Executive Defends Report on Gulf Oil Spill

Sasol Progresses with Lake Charles Cracker Project

Talent Gap Seen in Oil and Gas Industry Work Force


Earl’s Pearl of the Day:"A mind troubled by doubt cannot focus on the course to victory.” — Arthur Golden




March 4, 2013

Obama Nominates McCarthy for EPA, Moniz for Energy Chief

President Obama on Monday nominated Gina McCarthy to head the Environmental Protection Agency (EPA) and Ernest Moniz as the next Energy secretary.

At a White House event, Obama heralded the picks as a "great team” that would address his "top priorities going forward.”

"They’re going to be making sure we’re investing in American energy, we’re doing everything we can to combat the threat of climate change, we’re going to be creating jobs and economic opportunity in the first place,” said the president. "They are going to be a great team. And these are some of my top priorities going forward.”

McCarthy, currently the EPA’s assistant administrator for air and radiation, would replace former EPA Administrator Lisa Jackson, who left the agency in February.

Moniz, Obama’s Energy pick, is a physicist at the Massachusetts Institute of Technology (MIT), where he directs the MIT Energy Initiative. He has long been seen as the front-runner to replace outgoing Energy Secretary Steven Chu.

The selections of Moniz and McCarthy will round out Obama’s second-term energy and environment team, following his nomination last month of Sally Jewell to head the Interior Department.

Click here for more information.

Today's Links

BP Spill Judge to Hear From Explosion Survivor This Week

Barnett Shale to Remain Major Contributor to U.S. Gas Production

Layers of Energy Topics Will Fuel CERAWeek Conference in Houston

U.S. Review Gives Boost to Keystone Pipeline


Earl’s Pearl of the Day:"Truth, like surgery, may hurt, but it cures.” — Han Suyin



March 1, 2013

Louisiana Group Plans to Build Largest Methanol Plant in North America

South Louisiana Methanol (SLM) is planning to construct what it claims to be the largest methanol manufacturing plant in North America, with an investment of $1.3 billion.

Built in St. James Parish, La., the SLM methanol production plant will convert 163,000 btu per day of natural gas to 5,000 metric tons per day (mtpd) of methanol and is expected to make the company directly competitive with overseas plants.

SLM CEO Barry Williamson said Louisiana offers a high-quality work force, access to abundant natural gas and a strong network of pipelines and transportation facilities, making it an ideal partner for the production and distribution of methanol.

"We will utilize proven technology to build the largest methanol plant in North America, which will consume CO2 for a more efficient process, ensuring strong environmental stewardship,” Williamson added.

"The conversion of natural gas to methanol offers natural gas producers an alternative avenue to LNG, enabling the creation of products, which are consumed at home on a long-term basis.”

The construction of the methanol plant is scheduled to commence later this year, while the full commissioning and start-up is slated for 2016.

Click here for more information.

Today's Links

BP Oil Spill Probe Did Not Address Cost Overruns

Canada Resources Minister Doesn’t Expect Keystone Rejection

Lawsuit Challenges Alaska Petroleum Reserve Access

Judge to Hear Suit over Grand Canyon Mining Ban


Earl’s Pearl of the Day:"Responsibility walks hand in hand with capacity and power.” — J. G. Holland



February 28, 2013

Coast Guard Responds to Oil Spill off Louisiana Shore

The U.S. Coast Guard is investigating a report of an inactive wellhead spewing oily water into marshland about 50 miles south of New Orleans.

According to the Coast Guard the accident occurred Tuesday around 8 p.m. when a 42-foot crew boat came into contact with the wellhead nine miles south of Port Sulphur, La., and compromised the dormant geyser.

No injuries were reported.

The wellhead is owned by Swift Energy and has been inactive since December of 2007. Swift Energy’s president, Bruce Vincent, said the well was shut down because it was considered under producing.

The Coast Guard does not know how much of the water and oil mix is flowing out of the well but Vincent said the last time the well flow was assessed, only 18 barrels of oil a day were flowing. That pales in comparison to the 2010 BP oil spill, which released an average of about 60,000 barrels a day or 2.5 million gallons.

Vincent said officials at the company are developing plans to control the flow and hope to have the well capped in the next couple of days. He also noted the flow is not continuous. "It’s what I would call surging or burping,” he said. "It flows for a while then stops flowing and builds up pressure then flows again.”

Swift Energy has deployed a small army to clean up the spill. "We have containment booms around the wellhead — those are in place,” said Vincent. "We also have skimmers skimming up the oil that’s contained within that boom area. We also have been deploying additional booms to protect the marsh area.”

Click here for more information.


Today's Links

BP Safety Expert Returns to Stand in Gulf Oil Spill Trial

Shell Suspends Drilling in Alaska’s Arctic

Gasoline Futures Slump as Northeast Supply Worries Ease

Senator Meets With Interior Nominee Jewell


Earl’s Pearl of the Day:"I’d rather be a failure at something I love than a success at something I hate.” — George Burns




February 27, 2013

Witness Says Deepwater Horizon Accident Was ‘Classic Failure of Management’

An expert witness for plaintiffs suing BP said the 2010 Deepwater Horizon accident was "a classic failure of management and leadership in BP.”

Robert Bea, a University of California Berkeley engineering professor who has worked as a safety consultant for BP starting in 2001, said Tuesday he sent many warnings to the company’s management in the years before the accident about how cost-cutting would hurt the safety of operations.

"It was too lean,” Bea said of BP’s operations after it reduced spending.

Bea also criticized BP’s own internal investigation of the Deepwater Horizon incident for failing to investigate management decisions leading up to the accident. Instead, he said, BP’s study, known as The Bly Report, focused on the direct cause of the explosion on the drilling rig and the role equipment and crew on the rig played.

During cross examination, Mike Brock, a lawyer for BP, tried to challenge the credibility of Bea’s testimony, emphasizing the limits of his expertise and emphasizing the role the companies suing BP played in providing him information for a report he did that was critical of BP’s work leading up to the blowout.

"You understood that plaintiff’s legal team was focused on finding documents that hurt BP, not helped BP?” Brock asked.

Bea said he and his colleagues "were searching for the truth, the facts.”

BP has argued the accident was due to many errors and misjudgments by all of the companies involved in the project, including rig owner Transocean and cement contractor Halliburton.

Click here for more information.

Today's Links

Texas Oil Production Surpasses Norway

Louisiana 8th in U.S. for Export Increases in 2012

CEOs Unveil Their Vision for U.S. Energy Policy

Alaska Seeks Consultant to Help Promote Gas


Earl’s Pearl of the Day:"It is best to do things systematically, since we are only human, and disorder is our worst enemy.” — Hesiod




February 26, 2013

Engineering Expert Takes Stand as Testimony Starts in Gulf Spill Trial

An engineering professor who specializes in risk assessment and management took the stand Tuesday in the civil trial over the 2010 Gulf of Mexico oil spill disaster.

Robert Bea of the University of California-Berkeley is discussing safety processes at the companies involved and other issues related to the causes of the Macondo well blowout and Deepwater Horizon rig explosion. Bea was consulted by the White House commission that investigated the explosion and has produced several reports faulting BP and its partners for their attitude toward safety.

One of his reports, produced Aug. 26, 2011, was admitted into evidence as his testimony began. Bea, a professor emeritus in civil and environmental engineering, is co-founder of the Center for Catastrophic Risk Management. He also is a former engineer at Shell Oil.

Also among the first witnesses is Lamar McKay, the former head of BP America. Lawyers this week also are expected to play video footage of former BP CEO Tony Hayward’s deposition in the case.

During the first phase of the trial, expected to last up to three months, U.S. District Judge Carl Barbier in New Orleans will hear evidence on causes of the blowout and will determine how to allocate fault, which may or may not include percentages of blame.

The second phase will address the amount of oil that spilled.

Barbier also is expected to determine if the disaster resulted from gross negligence. Further proceedings could determine how much in punitive damages should be assessed, and separate trials could determine damage awards for individuals and businesses that opted out of a multibillion-dollar settlement last year between BP and private parties claiming economic or health damages.

Click here for more information.
http://fuelfix.com/blog/2013/02/26/engineering-expert-takes-stand-as-testimony-starts-in-gulf-spill-trial/


Today's Links

Crude Export Ban No Match for Lightest U.S. Shale Oil

Chevron May Consider Expanding LNG Export Project in Canada

Upgrades Needed to Fuel Domestic Energy Boom

Miller Energy Brings Alaska Well On line

Earl’s Pearl of the Day:"In the business world, the rearview mirror is always clearer than the windshield.” — Warren Buffett





February 25, 2013

Gulf Oil Spill Trial Starts with Billions of Dollars at Stake for BP, Others

Billions of dollars are at stake as a federal civil trial over the Gulf of Mexico oil spill starts today nearly three years after the deadly disaster.

Opening statements are expected to last the entire day in the maritime trial of the century as British oil giant BP defends itself against damages sought by the U.S. government and states affected by the 2010 spill.

Since the Macondo well blew out and the Deepwater Horizon rig exploded some 50 miles off the coast of Louisiana, BP has already spent more than $24 billion on costs related to the disaster and compensating victims.

It also has agreed to pay $4.5 billion in penalties to resolve criminal charges and related securities violations, and it expects to pay out $7.8 billion as part of a settlement of a class action lawsuit with thousands of spill victims. People who have opted out of that deal have preserved their claims in the civil case.

Those figures pale in comparison to what the company faces if the federal government and Gulf States have their way at the trial. They will try to prove BP acted with gross negligence, a finding that if found by the judge would allow for the highest civil penalties to be imposed.

According to a recent BP filing, the cumulative amount of economic damage claims being asserted by the Gulf States and local communities is roughly $34 billion. That figure does not include federal Clean Water Act claims or natural resources damage claims. BP faces a maximum Clean Water Act penalty of $17.6 billion.

Nearly seven hours have been set aside for opening statements in a trial over the deadly rig explosion in the Gulf that resulted in the nation’s worst offshore oil spill.

Click here for more information.

Today's Links

BP Gulf of Mexico Spill, From Disaster to Trial: Timeline

Cheniere: First LNG Export Facility to Start in Late 2015

Fight over Gas Exports is a Prelude to Oil Exports Brawl

Shell Reassesses Development Plan for North Sea Fram Field


Earl’s Pearl of the Day:"It’s not the will to win that matters ... everyone has that. It’s the will to prepare to win that matters.” — Paul "Bear” Bryant










February 22, 2013

Salazar Signs Management Plan for Alaska Reserve

A management plan for the vast National Petroleum Reserve-Alaska (NPR-A) splits an Indiana-size area roughly in half between conservation areas and land available for petroleum development, and allows pipelines carrying oil or gas to be constructed through the reserve.

Interior Secretary Ken Salazar announced Thursday he had signed a record of decision for the reserve west of Prudhoe Bay and south of Barrow on Alaska’s North Slope. He said the balanced approach under the plan was the result of extensive local testimony.
"This comprehensive plan will allow us to continue to expand our leasing in the NPR-A, as has happened over the past three years, while protecting the outstanding and unique resources that are critically important to the culture and subsistence lifestyle of Alaska natives and our nation’s conservation heritage,” Salazar said.

Perhaps as important to the petroleum industry was the commitment to access through the reserve for a pipeline that can connect oil drilled offshore in the Chukchi and Beaufort seas to the trans-Alaska pipeline. The management plan provides "explicit confirmation” that potential pipelines carrying oil or gas can be constructed through the reserve, Salazar said in his announcement.

The Bureau of Land Management manages the reserve and estimates lands made available for development contain nearly three-fourths of estimated economically recoverable oil and over half of the estimated economically recoverable gas.

Click here for more information.

Today's Links

EU Reaches Preliminary Deal on Offshore Oil, Gas Safety Rules

U.S. Railcar Oil Deliveries Hit Record in 2012

Kinder Morgan Energy Partners Planning Houston Rail Project

Israel Gives Go-Ahead to Drilling on Golan Heights


Earl’s Pearl of the Day:"Live in such a way that you would not be ashamed to sell your parrot to the town gossip.” — Will Rogers




February 21, 2013

Deep Water Oil’s Lasting Allure

As the U.S. energy boom heats up in landlocked states from North Dakota to Oklahoma, some oil companies are still making multibillion dollar bets on finding crude in the deepest waters of the Gulf of Mexico.

About 600 workers at a shipyard in Corpus Christi, Texas, are building three story steel structures that will make up Chevron’s outpost many miles offshore, in an area geologists say is promising, but where almost no oil has yet been pumped.

"It’ll be the first house in the neighborhood,” said Glenn Lohfink, the Chevron construction manager at the site.

The target Chevron is aiming at is called the Lower Tertiary, considered by many to be the Gulf of Mexico’s last frontier. Its heart is buried thousands of feet below sea level, hundreds of miles from shore and almost a three-hour helicopter ride from New Orleans.

Lower Tertiary oil fields haven’t been fully decoded by geologists, but Chevron is investing $7.5 billion just to start tapping its first two discoveries there, the Jack and St. Malo fields. The company expects to install a platform with the capacity to produce 177,000 barrels of oil and natural gas a day, generating annual revenue worth billions of dollars at current prices of roughly $96 a barrel for decades to come.

Chevron’s platform will serve as a beachhead for further exploitation of the area, connecting not only Jack and St. Malo but neighboring fields such as ExxonMobil’s Julia discovery.

Click here for more information.

Today's Links

Shell’s Olympus Platform Readies for Gulf of Mexico Journey

U.S. Court Decision Could Reduce BP’s Final Oil Spill Penalty

Official: Alaska ‘Well Positioned’ for LNG Export Potential

Japan Prime Minister to Ask Obama for Shale Exports


Earl’s Pearl of the Day:"Achievable goals are the first step to self improvement.” — J. K. Rowling




February 18, 2013

Companies Detail 800-Mile Alaska Gas Pipeline

ExxonMobil, ConocoPhillips, BP and TransCanada said Friday they plan to develop a natural gas pipeline from Alaska’s North Slope to a port where the gas would be prepared for export as part of a project expected to cost $45 billion to $65 billion.

Under the companies’ plan, or "concept,” an 800-mile pipeline would be built with the capacity to ship 3 billion to 3.5 billion cubic feet of gas to an area near a port where the gas would be turned into a liquid. The liquefied natural gas would be stored in tanks and loaded onto tankers from a loading jetty with two berths, according to a plan attached to the letter. In addition to those facilities, a natural gas treatment facility would be built on the North Slope, near Prudhoe Bay, near where the gas would be produced.

The liquefaction plant would be built on a 400-acre to 600-acre site and be able to process 15 million to 18 million tons of gas a year, executives with the companies said in the letter.

"We remain committed to responsibly developing the State’s considerable resources and will keep you advised of our progress,” read a letter to Alaska Governor Sean Parnell, which was signed by Randy Broiles at ExxonMobil, Trond-Erik Johansen at ConocoPhillips, Janet Weiss at BP and Tony Palmer at TransCanada.

If built, the gas pipeline and export facility would be one of the largest LNG projects in the world, said Gov. Parnell, who has strongly supported development of Alaska’s gas and a pipeline to ship the gas to overseas markets. As part of an agreement with the state, the companies promised to provide periodic updates on their pipeline development plans.

Click here for more information.

Today's Links

Apache Prevents Blowout in Gulf of Mexico Well

China Says ConocoPhillips Can Resume Production

Obama Faces Risks in Pipeline Decision

Oil’s New Reign in Texas Draws Comparisons to the Kingdom


Earl’s Pearl of the Day:"Nothing is impossible. Some things are just less likely than others.” — Jonathan Winters




February 15, 2013

Judge Approves Transocean Settlement

A federal judge in New Orleans approved Transocean’s $400 million criminal settlement with the Justice Department over the 2010 Deepwater Horizon accident, a spokesman for the company said Thursday.

Judge Jane Triche Milazzo accepted Transocean’s guilty plea to one criminal misdemeanor violation of the Clean Water Act for failing to properly monitor the well at the time of the deadly 2010 blowout in the Gulf of Mexico, the spokesman said.

The company will pay a $100 million fine within 60 days and $150 million each over the next three to five years to the National Fish and Wildlife Foundation and the National Academy of Sciences for oil spill response and habitat rehabilitation.

Transocean also agreed to pay $1 billion in fines for civil violations of the Clean Water Act, but that settlement must be approved separately by another judge. The settlement agreements were announced in early January.

Oil giant BP, which was leasing the rig to drill an exploratory well, agreed to pay $4.5 billion in November to settle all criminal and some civil charges in the case.

BP still faces what could be many billions of dollars in fines for violating the Clean Water Act, as well as billions of dollars in payments under the Natural Resources Damages Assessment process. The first phase of a civil trial over culpability in the accident is scheduled to begin before a federal judge in New Orleans on Feb. 25.

Click here for more information.

Today's Links

Airgas Announces Plans for New Carbon Dioxide Plant

Governors Ask Nominee Jewell to Open Atlantic Waters for Exploration


Marcellus Shale Gas Boom Expected to Slow in 2013


Lebanon Kicks Off Offshore Licensing Round


Earl’s Pearl of the Day:"An honest man can feel no pleasure in the exercise of power over his fellow citizens.” — Thomas Jefferson



February 14, 2013

TransCanada Official: Keystone Decision from State Dept. 2-3 Months Away

A senior executive of TransCanada Corp. said the company expects final State Department approval for the Keystone XL pipeline expansion in two to three months, following a final U.S. environmental assessment, which he said was "imminent.”

Alexander Pourbaix, TransCanada’s president for energy and oil pipelines businesses, said based on feedback from Washington, he would expect a final decision from State in the first half of 2013. He said after State receives a final U.S. government-ordered environmental assessment, which he said he would expect to be finished within weeks, the agency would have all the pieces of information it needs to make a decision.

TransCanada is awaiting State Department approval for the Keystone XL project, which envisions increasing oil export capacity from Canada to the United States. Early last year, the Obama Administration rejected the line — which needs State approval because it crosses the U.S. border — but said it was open to reconsidering the pipeline.

Click here for more information.

Today's Links

API: 69% of Voters Support Keystone XL Pipeline

ExxonMobil Grows Arctic Reach in Russia

Nexen Secures U.S. Approval of Its Sale to CNOOC of China

Puzzled at the Pump


Earl’s Pearl of the Day:"A people that values its privileges above its principles soon loses both.” — Dwight D. Eisenhower



February 13, 2013


President ‘Will Keep Cutting’ O&G Red Tape

In his State of the Union address Tuesday night, President Obama pledged to keep cutting red tape in the energy sector and to speed up new oil and gas permits, while also announcing the launch of a new oil and gas sector-funded Energy Security Trust aimed at developing technologies to help wean U.S. vehicles off oil.

President Obama noted the recent boom in natural gas had led to cleaner power and greater energy independence.

"That’s why my administration will keep cutting red tape and speeding up new oil and gas permits. But I also want to work with this Congress to encourage the research and technology that helps natural gas burn even cleaner and protects our air and water,” he said.

President Obama also proposed the launch of a new Energy Security Trust that would be funded by revenues from the oil and gas sector. This trust "will drive new research and technology to shift our cars and trucks off oil for good,” he said.

Click here for more information.

Today's Links

Big Oil Warms Up to Arctic Despite Challenges

Statoil Pipeline May Pave Way for Permanent Arctic Hub

North America Oil, Gas Resources Main Focus of 2012 M&A Activity

North Dakota Governor: Refinery Construction Could Start This Spring



Earl’s Pearl of the Day:"Do not anticipate trouble, or worry about what may never happen. Keep in the sunlight.” — Benjamin Franklin






February 10, 2013

Keystone XL Pipeline Action is Near, Kerry Suggests

Secretary of State John F. Kerry says he would stick to a "very open and transparent” permitting process for the proposed Keystone XL oil pipeline, adding, "I hope we will be able to make an announcement in the near term.”

Emerging from a meeting with Canadian Foreign Minister John Baird, Kerry said, "We have a legitimate process underway, and I’m going to honor that.” He said it was "fair and accountable.”

It was Kerry’s first meeting as secretary with a foreign diplomat, a nod to neighborliness but also to the importance of settling the Keystone XL issue.

Baird said he and Kerry talked about making a decision "based on science.”

"I also underlined on the environment, on greenhouse gas emissions, we’ve accepted the same reductions, targets as President Obama has, 17-percent reduction,” Baird said. He noted Canada is planning to phase out all coal-fired electricity plants.

The State Department will soon release a new environmental impact statement, based on TransCanada’s revised application. That will trigger a several-week period for public comments and responses.

Click here for more information.

Today's Links

Pickens: Lack of Gov’t Leadership ‘Missing Link’ in O&G Development

Energy Exports Boosting U.S. Trade Position

CEA: Five Oil & Gas Predictions for 2013

Australian Oil Workers Are World’s Best Paid


Earl’s Pearl of the Day:"Sometimes the questions are complicated and the answers are simple.” — Dr. Seuss


February 8, 2013

U.S. to Lease 38 Million Acres in Gulf Next Month

The U.S. Department of the Interior has finalized plans to auction oil and gas drilling leases for as much as 38 million acres in the Central Gulf of Mexico next month, giving oil companies a chance to expand their footprint in the booming offshore oil region.

The lease sale scheduled for March 20 in New Orleans will offer all unleased areas in the Central Gulf of Mexico Planning Area — offshore Louisiana, Mississippi and Alabama — which the department said could lead to the production of as much as nearly a billion barrels of oil and nearly 4 trillion cubic feet of natural gas.

The Central Gulf was the site of the 2010 Deepwater Horizon blowout. Drilling activity has rebounded, and companies have indicated they expect the boom to continue in deepwater areas, where exploration and production companies are snapping up newly built rigs capable of drilling to greater depths.

The upcoming sale includes shallow water acreage as close as three miles from the coast as well as tracts as far as 230 miles offshore in waters more than 11,000 feet deep.

The Bureau of Ocean Energy Management’s five-year plan calls for one more Gulf of Mexico lease sale to be held this year in the Western Gulf. There are four more Central Gulf sales planned through 2017, as well as several in other areas of the Gulf of Mexico and off the coast of Alaska.

Click here for more information.

Today's Links

Domestic Crude puts U.S. Refineries in a Sweet Spot

DOI Calls for Drillers to Inspect, Replace Bolts after Defects Found

Stranded Shell Drill Vessel Won’t Face State Tax

Japan’s Tepco Turns to U.S.’s Cameron for LNG


Earl’s Pearl of the Day: "Take chances, make mistakes. That’s how you grow. Pain nourishes your courage. You have to fail in order to practice being brave.” — Mary Tyler Moore



February 7, 2013

BP to Contest $34B Gulf Suits from State, Local Governments

BP plans to "vigorously contest” legal claims for tens of billions of dollars in damages stemming from the 2010 Gulf of Mexico disaster, describing the lawsuits as "seriously flawed.”

Demands from U.S. state and local governments for $34 billion risk ballooning BP’s overall bill for the Deepwater Horizon rig explosion and oil spill to more than $90 billion, more than double the amount the U.K. oil giant has already provisioned for.

Alabama, Mississippi, Florida and Louisiana are seeking the money in compensation for economic losses and property damage caused by the incident. BP is already facing spill costs of around $58 billion, which includes penalties, damages and cleanup costs the U.K.-based energy giant has already paid out, committed to spend or could yet be fined when the matter goes before a New Orleans judge in a civil trial due to start Feb. 25.

BP Chief Financial Officer Brian Gilvary said the bulk of the state claims are based around losses in potential tax revenues and as such will be hard to prove.

"That will be an interesting thing to try to prove given we have provided one of the biggest fiscal stimuli the Gulf has ever seen; we hired up over 40,000 people to deal with it and paid taxes as a consequence,” Gilvary said.

BP has already provided for what it believes is a "fair and reasonable” assessment of the state economic losses in its $42.2 billion provision, Gilvary said. But he declined to say how much had been allocated.

Click here for more information.

Today's Links

Oilmen Hope to Make New History at Spindletop

U.S. Coal Finds Warm Embrace Overseas

Howard Midstream to Build Gas Plant, Rail Hub in S. Texas

Why Should the Obama Administration Approve the Keystone XL Pipeline?


Earl’s Pearl of the Day:"Success is not final, failure is not fatal; it is the courage to continue that counts.” ― Winston Churchill



February 6, 2013

U.S. DOE to Move Carefully on LNG Export Requests

The U.S. Department of Energy plans to move carefully as it considers applications to export LNG to countries that do not have free trade agreements with the U.S., Christopher A. Smith, deputy assistant U.S. energy secretary for oil and gas in DOE’s fossil energy office, said at a meeting of state utility regulators.

"This is a tremendously important decision,” he told the National Association of Regulatory Commissioners Gas Committee during NARUC’s 2013 winter meeting. "Our approach is to make sure we’ve done all the proper groundwork and analysis to create a transparent process that withstands public scrutiny.”

Federal law stipulates that LNG agreements with countries that are United States free trade partners must be processed immediately, but applications involving other nations have to be reviewed to determine if they would be in the national interest. DOE has 16 such applications pending, and recently opened a reply period to comments it received about a general policy.

Click here for more information.

Today's Links

White House Weighs Emission Rules

Deep-Sea Drilling Muddies Political Waters

Petrobras Working to Sell Texas Refinery, But Not at Any Price - CEO

Occidental Petroleum Seeks to Build Texas Ethylene Plant



Earl’s Pearl of the Day:"Truth is the only safe ground to stand on.” — Elizabeth Cady Stanton



February 5, 2013

Offshore Boom Will Boost Equipment Suppliers

Recent deepwater discoveries combined with a shortage of drilling vessels should make for a booming year for offshore equipment supplies, a Barclay’s report said Monday.

Platform and rig builders are struggling to keep up with the demand for offshore drilling rigs, as exploration throughout the Gulf of Mexico, Brazil and Africa continues to grow. Many offshore projects are moving from exploration to production, further increasing the demand for offshore equipment.

"We anticipate roughly 80 jackups and 50 floaters (drillships) will be delivered into the offshore market over the next two years and expect relatively few of these units will displace rigs currently working,” Barclays wrote.

About 40 percent of the 50 drillships have been contracted out through 2014, a further indication of a growing demand for the equipment that will be needed for drilling.


Click here for more information.

Today's Links

Canada Backs Export License for Shell LNG Project

Shipping Landlocked Alberta Oil North an Option

America’s Plastic Revival

Coal, Solar Companies Claim Super Bowl Outage Makes Their Case

Earl’s Pearl of the Day:"We must learn to live together as brothers or perish together as fools.” — Martin Luther King Jr.



February 4, 2013

Genesis Energy to Expand Terminal, Build Crude Pipeline to Exxon’s Baton Rouge Refinery

Genesis Energy announced the company plans to invest approximately $125 million to improve existing assets and develop new infrastructure in Louisiana to connect into ExxonMobil’s Baton Rouge Refinery. The project is expected to generate positive economic benefits both for the community of Baton Rouge and the state of Louisiana.

"With the expansion of our operations in Louisiana, Genesis looks forward to a strong future in the state and to increasing our contribution to the local economy,” Genesis CEO Grant Sims said.

Genesis will improve its existing terminal at Port Hudson and build a new 18-mile crude oil pipeline connecting Port Hudson to the Maryland Terminal and continuing downstream to the Anchorage Tank Farm. The company also plans to build a new crude oil unit train facility at the Baton Rouge Maryland Terminal.

The new 18-mile pipeline will have an ultimate capacity of about 350,000 bpd, and in addition to its connection to the ExxonMobil Baton Rouge Refinery, the pipeline will have potential access to other local refineries representing approximately 140,000 bpd.

Project construction is scheduled to begin in early 2013. The Port Hudson upgrades and new crude oil pipeline are expected to be completed by the end of 2013.

Click here for more information.

Today's Links

Energy Secretary Chu to Resign

Vast Oil Reserve May Now Be Within Reach

For BP, the Cleanup Isn’t Entirely Over

‘Abnormality’ Causes Super Bowl Outage


Earl’s Pearl of the Day:"You make a living by what you get; you make a life by what you give.” —Winston Churchill



January 31, 2013

Ethanol Industry Turns to Plant Residue, Scraps

After decades of talk, the ethanol industry is building multimillion-dollar refineries in several states that will use corn plant residue, wood scraps and even garbage to produce the fuel additive.

The breakthrough comes at a key time for the industry, after the drought heightened criticism about the vast amount of corn used to brew up ethanol rather than be transformed into animal feed or other foods. The corn crop already was smaller than expected because of drought last year, and livestock groups were especially critical of how 40 percent of the crop being diverted toward ethanol caused corn prices to soar.

The new cellulosic ethanol technology could quiet that criticism while also making use of material largely seen as worthless.

For more information, click here.

Today's Links

Kinder Makes Shale Grab with $4 Million Deal

Petrolia Confirms Hydrocarbons at Bourque Well

Rodriguez Well Makes Significant Gas Condensate Discovery


Earl’s Pearl of the Day: "The highest reward for a man’s toil is not what he gets for it but what he becomes by it.” — John Ruskin







January 30, 2013

Offshore Drillers Could Learn from Aviation

They did, in fact, ground the planes.

After the recent problems with batteries on the Boeing 787, the Federal Aviation Administration ordered all of the aircraft flown by U.S. carriers removed from service.

Rather than using commercial aviation as an excuse, the offshore energy industry should use it as a model for improving safety.

Among safety experts, the exploding batteries aboard the Dreamliners are known as a leading risk indicator. In other words, they could be a sign of a bigger problem.

For more information, click here.

Today's Links

Cheapest Wind Energy Spurring Renewables Deals

Power Plant Announced for South Texas

API Launches Oil Spill Research Website

Victoria Finds More Customers for Cameroon Gas


Earl’s Pearl of the Day: "If you are not the hero of your own story, then you’re missing the whole point of your humanity.” — Steve Maraboli







January 29, 2013

United States Will Remain Largest Source of New Oil Growth in 2013

Topping the list of the big oil and gas stories in 2012 was the dramatic surge in U.S. oil production. In 2013, the United States will remain the largest source of new oil growth worldwide aided by the shale boom.

The big turnaround of U.S. oil production brought by new light tight oil developments was fully recognized in 2012, putting to rest the long-held notion that domestic oil production was in terminal decline. The rise in domestic oil output and the expectation that U.S. oil development will continue to grow amid high oil prices prompted some market observers to predict the United States could become the world’s largest oil producer, upstaging Saudi Arabia, by 2020.

For more information, click here.

Today's Links

Chattanooga Could Be Hot Spot for Fracking

National Mining Association Upbeat About 2013

Olympus Hull Arrives in Gulf of Mexico

UTEC Consolidates Middle East Position


Earl’s Pearl of the Day: "Not what we have, but what we enjoy, constitutes our abundance.” — Epicurus





January 28, 2013

Billions in Gas and Drilling Royalties Transform Lives

Private landowners are reaping billions of dollars in royalties each year from the boom in natural gas drilling, transforming lives and livelihoods even as the windfall provides only a modest boost to the broader economy.

For some landowners, the unexpected royalties have made a big difference.

"We used to have to put stuff on credit cards. It was basically living from paycheck to paycheck,” said Shawn Georgetti, who runs a family dairy farm in Avella, about 30 miles southwest of Pittsburgh.

For more information, click here.

Today's Links

Drilling Boom Creates Long Lines in West Virginia

Smaller Offshore Drillers Enjoy Solid Returns

Russia to Receive Up to $5 Billion from Offshore Licenses in 2013

Will New York Join the Fracking Club?


Earl’s Pearl of the Day: "The future belongs to those who believe in the beauty of their dreams.” — Eleanor Roosevelt








January 25, 2013

Lawmakers Urge Exports of U.S. Natural Gas

The United States can safely export more of its natural gas bounty without causing prices to skyrocket, 110 lawmakers told Energy Secretary Steven Chu on Thursday.

The assertion directly responds to the biggest argument mounted against more foreign sales of the fossil fuel, mostly by a cadre of chemical makers and manufacturers that rely on natural gas supplies to power their plants and as a feedstock they transform into other materials.

The lawmakers — 89 Republicans and 21 Democrats — said market forces will keep prices in check, even if American producers sell natural gas to European and Asian markets where gas fetches three and four times as much as it does in the United States.

For more information, click here.

Today's Links

AGA Not Opposed to U.S. LNG Exports

A Compelling Personal Story and a Push for Energy Independence

Closed Refinery Revived with Eagle Ford Crude

Johan Sverdrup Appraisal Well Successful


Earl’s Pearl of the Day:"Successful people are not gifted. They work hard, then succeed on purpose.” — G.K. Nielson





January 24, 2013

Railroads Focus on Natural Gas

U.S. railroads are looking at natural gas to meet a 2015 deadline for lowering emissions, but it’s unlikely more than a handful of locomotives will be using the fuel by then.

"We don’t want to kid ourselves about how long a transformation will take,” said David Hill, vice president of operations with Encana, which is working with Canadian National Railway on a project to power locomotives using liquefied natural gas (LNG).

He and other speakers at the World LNG Fuels Conference, which ended Wednesday at the George R. Brown Conference Center, said natural gas could help railroads lower emissions and save on skyrocketing diesel fuel bills.

For more information, click here.

Today's Links

Cyprus Signs Gas Drilling Deal with Consortium

Oil Prices Get Boost from China Manufacturing

Norway to Review Security at Domestic Oil, Gas Facilities

Sanchez Energy Offers Pure Play on Focus on Eagle Ford


Earl’s Pearl of the Day:"Nothing is a waste of time if you use the experience wisely.” — Auguste Rodin








January 23, 2013

NC Fracking Group Tackles Disclosure Rules

Interest groups hashing out fracking regulations started work Tuesday by tackling rules on what the public will be told about chemical additives pumped underground and how broad trade secrecy exceptions will be allowed.

The group bringing together oil and gas representatives, state government agencies, environmentalists, and advocates for cities and rural communities started debating what drillers must disclose about chemicals used during the process called hydraulic fracturing, or fracking. The process involves pumping a mixture of water, sand and chemicals to crack open underground shale rock and release natural gas.

For more information, click here.

Today's Links

Eagle Ford November Crude Output Rises 70 Percent from a Year Earlier

Ikea to Double Renewable Energy Investment to $4 Billion by 2015

Thousands of Jobs Will Open Up as Western Australia’s LNG Industry Develops

Chevron Signs Petroleum Deals in Offshore Morocco


Earl’s Pearl of the Day: "Confidence is everything. From there, it’s a small step to winning.” — Craig Stadle








January 22, 2013


Friendly Business Environment Fuels U.S. Oil Boom

A favorable business climate in the United States has helped make the country the world leader in the shale revolution, a report said Monday.

In the report, "Energy and the New Global Industrial Landscape: A Tectonic Shift?”, research firm IHS notes shale gas and tight oil deposits are being discovered all over the world. However, the report adds the United States. has theingredients to help the industry flourish, including private property ownership rights, good energy infrastructure and access to risk-based investment capital.

For more information, click here.

Today's Links

Firsthand Look at Natural Gas as Transportation Fuel

Buccaneer Energy Could Begin Drilling Soon

Russian Oil Production to Peak Soon

Cairn Fully Funded for Exploration Campaign


Earl’s Pearl of the Day: "Respect is a two way street. If you want it, you’ve got to give it.” — R.G. Risch



January 21, 2013

Planning, Stamina Needed for Marathoning and O&G Exploration, Production

What do running marathons like the Jan. 13 Chevron Houston Marathon and working in the oil and gas exploration and development have in common? Both require planning, stamina and the flexibility to respond to unforeseen conditions, according to people who work in the oil and gas industry.

Just like global E&P efforts, particularly for unconventional oil and gas resources and deepwater, the number of people who run marathons worldwide has grown in recent years. More than 551,000 people completed a marathon in 2011, according to the marathon running statistic website www.statisticbrain.com.

E&P activity and marathons are both about planning, from the route a runner or well runs, the casing or runner’s body, the fluids, the support team and the drill bit or running shoes, said John Graves, money manager and author of the book "Fracking: America’s Alternative Energy Revolution.” Training for serious running is like prepping a site for drilling.

For more information, click here.

Today's Links

Quarterly Forecast for Big Oil: Sunny and Profitable

To Frack or Not to Frack?

Petronas’ Sarawak Marks First Onshore Discovery in 24 Years

Serica Energy Sees Busy Year Ahead


Earl’s Pearl of the Day: "Be kind, for everyone you meet is fighting a hard battle.” — Plato




January 18, 2013

Obama to Confront Oil Pipeline, Climate Change

President Barack Obama’s second-term energy agenda is taking shape and, despite the departure of key Cabinet officials, it looks a lot like the first: more reliance on renewable energy sources, such as wind and solar, and expanded production of oil and natural gas. Obama also is promising to address climate change, an issue he has acknowledged was sometimes overlooked during his first term.

"The president has been clear that tackling climate change and enhancing energy security will be among his top priorities in his second term,” said Clark Stevens, a White House spokesman.

While the administration has made progress in developing renewable energy and improving fuel efficiency standards for vehicles, "we know there is more work to do,” Stevens said.

For more information, click here.

Today's Links

Oil Industry Battles Back on Natural Gas Exports

Iraq, BP Considering Kirkuk Field DealMarquee Energy Achieves

100-Percent Drilling Success on Core Oil Assets

Deep Sea Supply Wins Work for Vessel Trio


Earl’s Pearl of the Day: "The reward of a thing well done is to have done it.” — Ralph Waldo Emerson




January 17, 2013

Cheap Natural Gas Gives U.S. Refineries an Advantage

Refinery expansion projects could add as much as 9 million barrels a day to the world’s transportation fuel supply over the next five years, according to a report from Hart Energy.

That could mean competition for U.S. exports to Latin America and elsewhere.

But even if all of the expansion projects are completed — and that’s a big if — analysts expect increased demand to absorb the new supply and provide a continuing market for U.S. products, at least for the next few years.

For more information, click here.

Today's Links

High-Tech Energy Attracts $1.12 Trillion in Global Revenue

Parnell Sets New Benchmarks for Gas Pipeline

Grand Gulf Energy Spuds Port Hudson 1 Well

Deep Sea Supply in $852 Million Brazil Venture


Earl’s Pearl of the Day: "Attitude is a little thing that makes a big difference.” — Winston Churchill






January 16, 2013

Natural Gas Storage Gives Power Plants Flexibility

Natural gas storage for electric generation is helping to make the resource a flexible fuel for on-demand power production, speakers at a Houston conference said Tuesday.

The abundance of natural gas from shale has filled storage facilities with surpluses of the cheap resource. That has given electric power generators the ability to load up on the resource and ramp up gas-fired plant operations when power markets are strained and opportunities for returns are highest, said Paul Sierer, senior commercial transactor for Constellation, an Exelon company. He and others offered their insights on natural gas storage and electricity at the 11th Annual Platts Gas Storage Outlook conference held in the Hilton Houston Post Oak.

The capability to tap into gas in storage has become increasingly important as power markets have become stressed due to population and energy demand growth, increasing the need for on-demand generation that can be called into action within hours or even minutes, Sierer said.

For more information, click here.

Today's Links

Mitsubishi Invests $770 Million in German Offshore Wind

Big Sky to Spud Wolfberry Well

ConocoPhillips Agrees to Sell Cedar Creek Assets to Denbury

Huntington Risers Hooked Up


Earl’s Pearl of the Day: "Success is doing ordinary things extraordinarily well.” — Jim Rohn




January 15, 2013

Oil Companies Read the Tea Leaves

Predicting energy demand, population growth, policy changes and other global trends that will affect oil prices and industry strategy decades from now is far from an exact science. But major oil and gas companies see value in trying.

BP, Royal Dutch Shell and ExxonMobil are among the companies that publish outlooks forecasting the future of the energy sector. BP’s updated 2030 outlook is set for release Wednesday.

The goal is to figure out what the energy world will look like in the future so they can make the most profitable exploration and production decisions today. By releasing their conclusions publicly, these companies also spark an annual conversation about the world’s energy needs.

For more information, click here.

Today's Links

Shale Play Classes Offered

San Antonio Utility Signs 25-Year Wind Power Agreement

Miller Energy All Smiles Over Tennessee Well

Icahn Takes Stake in Transocean


Earl’s Pearl of the Day: "Happiness, I have discovered, is nearly always a rebound from hard work.” — David Grayson







January 14, 2013

Turning Over New Leaf in Climate Change

In a tidy white lab on the southern edge of Berkeley, Calif., scientists are trying to duplicate one of nature’s greatest tricks, pulling energy out of thin air.

They’re designing artificial leaves that can convert sunlight, carbon dioxide and water into chemical fuel, much like the photosynthesis of flowers and trees.

The team has already built a crude prototype from silicon, polymers and platinum that can create a simple and clean hydrogen fuel. If the scientists figure out how to cheaply produce more complicated energy sources, it would enable mass production of "drop-in” fuels that could power automobiles, trucks, planes and ships without pumping more greenhouse gas into the atmosphere.

For more information, click here.

Today's Links

Eagle Ford Drilling Fuels Income Surge for All

Oil Industry Beats Buffet in Railroad Investment Surge

Tullow Targets 1 Billion Barrels with 40 Wells Planned for 2013

First Oil Produced from Cormorant East


Earl’s Pearl of the Day: "Show me a thoroughly satisfied man and I will show you a failure.” — Thomas Edison






January 11, 2013

Oil and Gas Investments Vital to Nation’s Economy, Prosperity

America’s energy production and energy security require a focus on more than just an increase in oil production, API President and CEO Jack Gerard told reporters and Washington guests attending API’s State of American Energy event Tuesday.

He also reiterated welcoming President Obama’s campaign promise to support oil and natural gas development as part of an all-of-the-above energy strategy.

"With a newly elected Congress and a president beginning his second term, we are standing on the threshold of a new year – one that represents tremendous opportunities to move forward on building our economy and creating jobs for Americans who are looking for work. The oil and natural gas industry has been a bright spot in the past few years of sluggish economic growth and listless job creation … we are ready to do more.”

For more information, click here.

Today's Links

Chevron Expects 4Q Profit to Beat 3Q

Kinder Morgan to Increase Size of Trans Mountain Pipeline Expansion

Gazprom Begins New Tight Oil Project

Farstad Shipping Wins $58 Million Offshore Charters


Earl’s Pearl of the Day: "I have had dreams and I have had nightmares. But I have conquered my nightmares because of my dreams.” — Jonas Salk




January 10, 2013

Senate Proposal to Give U.S. Energy Revenues to States

Energy-rich states would be in a position to receive millions of dollars of oil royalties and other energy revenue currently collected by the federal government under a proposal being put together by a pair of key lawmakers.

The plan, being developed by top members of the Senate Energy and Natural Resources Committee, would allow states like Alaska to collect a share of royalties from oil in the U.S.-controlled waters of the Arctic Ocean and sets up other states like California to collect a share of revenue from solar power produced on public lands.

The federal government already distributes some oil and natural gas royalties to the states, but the setup is limited in scope.

Sens. Lisa Murkowski (R -Alaska) and Mary Landrieu (D-La.) are drafting the bill to expand the current revenue sharing arrangements. The legislation, which aides say is in its early stages but could be introduced as early as this month, would force the government to hand over 27.5 percent of energy revenue from offshore production. An additional 10 percent would be provided to states if they agreed to use the money for specific purposes, such as restoration projects.

For more information, click here.

Today's Links

Shale Playground in West Texas

Total Will Start Shale Drilling in Denmark This Year

LOGA Takes on Matt Damon

Subsea 7 JV Wins Pemex Contract


Earl’s Pearl of the Day: "Every day you have to test yourself. If you don’t it’s a wasted day.” — Terry Butts






January 9, 2013

Oil Production to Grow at Fastest Rate Ever

Driven by the shale boom, the United States in 2014 will hit its highest daily oil production level since 1988 and will grow oil output at the highest rate ever, the U.S. Energy Information Administration predicted Tuesday.

U.S. daily oil production, which averaged 6.4 million barrels a day in 2012, will surge 23 percent to average 7.9 million barrels a day in 2014, the administration said.

For more information, click here.

Today's Links

Why Venezuela and Chavez are Big Players in the Energy Sector

Deloitte Reports Boost Natural Gas Exports

Shell Relaunches Houston Technology Center

TransCanada Wins $5 Billion Pipeline Deal


Earl’s Pearl of the Day: "Desire is half of life. Indifference is half of death.” — Kabil Gibran





January 8, 2013

Energy M&A Activity Set Records in 2012

Fear of the fiscal cliff and the prospects of a second Obama Administration helped drive a record $254 billion in energy industry merger and acquisition deals last year, according to a new report.

"Many sellers were motivated to complete deals in advance of the uncertainties surrounding the second term of President Obama and the implications of U.S. governmental policy changes regarding the fiscal cliff,” said a report issued Monday by energy research firms PLS and Derrick Petroleum Services.

More than 670 deals were brokered in 2012, and deal values were 50-percent higher than the previous year as energy companies around the world jockeyed for position in a climate of high oil prices, depressed natural gas prices, the growth of emerging economies and President Obama’s re-election in November. Concerns that his second term will bring costly new regulation prompted some deals, the report suggests.

For more information, click here.

Today's Links

California Company Gets Keys to Exxon Tower

Lundin Budgets $1.7 Billion for Upstream in 2013

Ferus and Encana’s LNG Plans Focus on Canada

Assessment Underway for Kulluk


Earl’s Pearl of the Day: "The man that trims himself to suit everybody will soon whittle himself away.” — Charles Schwab



January 7, 2013

Oil Industry’s New Workers Have Great Eyesight — And Feathers

Until recently, falconry — the ancient art of hunting small game with trained birds of prey — was just a hobby for Michael Gregston, who makes a living leading canoe trips down the Missouri River. But to supplement his income, he has been toting four of his rare hawks and falcons in the bitter cold to an unusual destination for a bird enthusiast, an oil refinery.

"The battle begins when the sun goes down,” said Gregston, 60 years old.

Donning a bright green hard hat and fireproof suit on a recent afternoon, he prepared to fly his prized birds into the labyrinth of pipes and towers at the Phillips 66 refinery in Billings, Mont., where thousands of starlings roost each night. With two nearby refineries likely facing similar starling infestations, he said, "I think I have some job security.”

Big oil has never had the most bird-friendly reputation. But refineries across the country are now paying thousands of dollars a day to bring in rare raptors to chase away the nuisance birds that sully their facilities. It is a relatively new form of pest control that is also becoming popular at farms and vineyards.

For more information, click here.

Today's Links

A&M Scientists Study Plant Waste as Potential Biofuel

Natural Gas Vies with Electric Hybrid in GE Auto Fleet

ExxonMobil Greenlights Hebron Oilfield Development

Italian Juniors Report Positive Progress


Earl’s Pearl of the Day: "The greatest discovery of all time is that a person can change his future merely by changing his attitude.” — Oprah Winfrey



January 4, 2013

Petrobas Declares Two Campos Basin Oil Fields Commercial

Brazil’s Petrobras said Thursday it declared two offshore oil fields in the Campos Basin holding an estimated 350 million barrels of oil commercially viable.

Petrobras said the Aruanaand Oliva fields would be renamed Tartaruga Verde and Tartaruga Mestica, respectively. Tartaruga Verde holds an estimated 230 million boe, while Tartaruga Mestica has 121 million boe.

The two fields, however, are unlikely to help Petrobras shake off its recent production troubles. Tartaruga Verde and Tartaruga Mestica aren’t expected to start producing crude oil until 2017, with initial development part of the company’s $237 billion investment plan for the 2012-2016 period.

For more information, click here.

Today's Links

Valero Joint Venture Plans Oil Dock at Sabine Neches

FMC Technologies Expands with Land Purchase

West African Find for Harvest

Iceland Inks Pact with Petoro


Earl’s Pearl of the Day: "Love and compassion are necessities, not luxuries. Without them humanity cannot survive.” — Dalai Lama





January 3, 2013

Developing America’s New Energy Future

As we take the opportunity to reflect back on 2012, it’s worth remembering this past year as the beginning of an exciting new chapter in our nation’s energy future.

For the first time in many decades, advances in technology allow us to be optimistic about our capacity to restore our nation’s energy security.

Americans across the country, and across party lines, are beginning to sense that this new U.S. energy growth could help propel significant economic expansion over the coming years.

For more information, click here.

Today's Links

Independent Takes Midsize Gamble on Woodbine Play

MidAmerican to Buy Two California Solar Power Projects

Explorers Head to Europe’s Fringes in 2013

Alaska Proposes Changes to Hydraulic Fracturing Rules


Earl’s Pearl of the Day: "If your ship doesn’t come in, swim out to it.” — Jonathan Winters




January 2, 2013

Gulf of Mexico Will Be Strongest Offshore Market, Analysts Say

The deepwater Gulf of Mexico is poised for a strong comeback, with the number of floating rigs growing from about 36 today to 60 in 2015, analysts at the International Strategy and Investment Group forecast.

In its recently released report, "U.S. Gulf of Mexico Deepwater Outlook: Rising Up From the Ashes,” the investment firm projects companies will drill about 70 development wells in 2015, triple the number drilled this year and the highest level since 2002.

For more information, click here.

Today's Links

Energy’s Momentum Drives Real Estate Projects

Drilling Rig Set to Weather Fierce Storm in Small Alaska Port

BP Starts Up Skarv Field

Let’s Avoid Smothering Shale-Gas Boom


Earl’s Pearl of the Day: "Every day do something that will inch you closer to a better tomorrow.” — Doug Firebaugh




December 28, 2012

New Petroleum Engineering Leader Says Safety is Group’s Focus

As Egbert Imomoh prepares to take on his post as 2013 president of the Society of Petroleum Engineers, the industry continues to come under scrutiny on issues ranging from increased risks and safety to a push to perform more research and gather more data about emerging technologies.

All this takes place against the backdrop of a growing uncertainty about attracting and training new petroleum engineers as the aging work force nears retirement.

Imomoh, nonexecutive chairman and co-founder of Afren, a Nigeria-based independent oil and gas company with assets in Africa and Kurdistan, talked to the "Houston Chronicle” recently about what lies ahead – and how he plans to face the challenges that have been set out before him.

For the full Q&A, click here.

Today's Links

Cutting Water Use, Costs Through Teamwork

Chevron CEO: Affordable Energy is Crucial

Keppel O&M Bags Three New Contracts Worth $343 Million

Leighton Seeks to Employ 1,200 for New Work Awarded for Ichthys Project


Earl’s Pearl of the Day:"Action is the real measure of intelligence.” — Napoleon Hill








December 27, 2012

Judge Keeps Environmental Groups Out of Coal Fight

A federal judge won’t let environmental groups join the legal battle between North Dakota and Minnesota over coal power plants.

U.S. Magistrate Judge Steven Rau ruled Friday that the Minnesota attorney general is able to defend the lawsuit, and the case "will not be enhanced in any significant way” by adding environmental interests as parties.

For more information, click here.

Today's Links
ConocoPhillips Eyes Unconventional Oil and Gas in China

Chevron Takes Stake in Canadian Projects

Sunbird to Acquire Stake in Ibhubesi Projects

Sudan to Add Capacity with New Field


Earl’s Pearl of the Day: "If you don’t have confidence, you’ll always find a way not to win.” — Carl Lewis






December 26, 2012

2012’s Top 5 Oil and Gas Plays

2012 has been a stellar year for oil and gas. From East Africa to North America, new technology, major new discoveries, an unparalleled appetite for exploration and a metamorphosing perception of risk have changed the playing field.

We’re looking at potential rather than existing production, and here are our Top 5 picks for this year:

For more information, click here.

Today's Links

Canadian Plant to Feed Engines with LNG

Marcellus Natural Gas Production Expanded in 2012

Offshore with the Weathermen

Chevron Takes Stake in Canadian Projects


Earl’s Pearl of the Day: "I don’t let my mouth say anything my head can’t stand.” — Louis Armstrong






December 21, 2012

Plans Available for Alaska’s National Petroleum Reserve

Secretary of the Interior Ken Salazar announced Wednesday the availability of the Integrated Activity Plan (IAP) and Final Environmental Impact Statement (EIS) for the National Petroleum Reserve in Alaska (NPR-A). The preferred alternative identified in the EIS would allow for the development of 72 percent of the estimated economically recoverable oil in the reserve while protecting the vital subsistence resources of Alaska natives and the habitat of world-class wildlife populations.

Secretary Salazar also issued a memo to the Bureau of Land Management (BLM) confirming the preferred alternative will allow for the potential construction of pipelines carrying oil or gas from operations in the Chukchi and Beaufort Seas through the NPR-A.

After receiving more than 400,000 public comments and following two days of meetings and visits with North Slope leaders, Salazar first announced the key elements of the Preferred Alternative for the IAP/EIS in August. Release of the Final IAP/EIS today paves the way for the secretary to issue a Record of Decision that adopts the final management plan in the first quarter of 2013.

For more information, click here.

Today's Links

Statoil to Invest More Than $7 Billion in UK Mariner Field

Chevron Will Move Up to 800 Upstream Jobs to Houston

SandRidge to Sell Permian Assets for $2.6 Billion

EMGS Forges Frame Pact with Shell


Earl’s Pearl of the Day: "The only disability in life is a bad attitude.”— Scott Hamilton






December 20, 2012

Administration Says Pipelines Would Be Allowed in Petroleum Reserve

The Obama administration’s plan for managing wildlife and oil production in the 23-million-acre National Petroleum Reserve-Alaska will not prevent the construction of new pipelines that could carry crude across the state, said Interior Secretary Ken Salazar on Wednesday.

The Interior Department confirmed that policy regarding pipelines in unveiling a final environmental assessment of the government’s proposed management program for the 89-year-old reserve in northwest Alaska.

For more information, click here.

Today's Links

Canada Open for Business

YPF, Chevron Sign Argentina Shale Pact

Drilling Ops Completed at Petrolias Bourque Well

Oil Shows at Sverdrup Appraisal


Earl’s Pearl of the Day: "Do not dwell in the past; do not dream of the future, concentrate the mind on the present moment.” — Buddha










December 19, 2012

Officials Say Wider Canal Can Boost Natural Gas Exports

Transportation and port officials reiterated Tuesday that the nearly complete expansion of the Panama Canal will provide opportunities for growth in exports, but won’t immediately strain the state’s road, railroads and pipelines.

During a state Senate Transportation Committee hearing at the Capitol in Austin, the heads of the Texas Department of Transportation and the Port of Houston Authority summarized and elaborated on the findings of a report last week that described the effects on Texas of the $5.25 billion project that will nearly triple the canal’s capacity.

The report said the bigger canal mainly will allow for more exports to Asia, including natural gas as soon as companies get government permits to liquefy the gas for export in special tankers.

For more information, click here.

Today's Links

United States May Already Be World’s No. 1 Oil Producer

Norway’s Statoil Buys U.S. Shale Gas Land

Transocean Bags New Contracts, Extensions Totaling $119 Million

Dockwise Installs Shwe Topsides


Earl’s Pearl of the Day: "Nothing can add more power to your life than concentrating all your energies on a limited set of targets.” — Nido Qubein








December 18, 2012

Governors, Attorney Generals Seek Withdrawing of Fracking Rule

Republican government officials again asked President Obama to withdraw rules proposed by the Bureau of Land Management (BLM) that would regulate hydraulic fracturing on federal U.S. and Indian lands.

The proposed BLM rule ignores the "strong and efficient” track record of states to regulate oil and natural gas production, as well as the rule’s "significant and destructive impacts” on U.S. states, and needs to be taken into serious consideration, said Louisiana Gov. Bobby Jindal, who serves as chairman of the Republican Governors Association, and Oklahoma Attorney General E. Scott Pruitt, who serves as chairman of the Republican Attorneys General Association, in a Dec. 17 statement.

Jindal and Pruitt said the proposed rule would only discourage exploration and production on federal and Indian lands, potentially costing the federal and state government — that share federal royalties — billions of dollars in revenue, as well as negatively impact employment for states with federal lands.

For more information, click here.

Today's Links

ND Oil Rises to Record 23.1 Million Barrels in October

Chesapeake Declares Dividend, Despite Cost-Saving

Talisman Finalizes $1.5 Billion North Sea Deal

ConocoPhillips Sells Algerian Arm for $1.75 Billion


Earl’s Pearl of the Day:"We should not let our fears hold us back from pursuing our hopes.” — John F. Kennedy






December 17, 2012

Rice Students Design an Offshore Oilfield City of Tomorrow

A team of Rice University students has conceived an award-winning concept for a facility that would allow oil and gas employees to work and live offshore Brazil.

The three students — dubbed Team Petropolis — were presented with the opportunity to address the challenge Petrobras faces in housing workers as its exploration efforts move further offshore Brazil as part of the 2012 Challenge for the Odebrecht Award for Sustainable Development.

As part of the competition, the students addressed a need raised in a May 2011 "Rio Times” article. This article discussed the fact Petrobras’ fixed and floating platforms already serve as small autonomous floating cities with energy and water. But additional platforms will be needed to meet activity, and the growing distance of exploration offshore from the coast will make running helicopter trips unfeasible. To meet this need, Petrobras said it was planning 50 additional floating cities offshore Brazil.

For more information, click here.

Today's Links

Encana’s PetroChina Partnership May Be First of Many

Fuel Cell Park in Bridgeport Moves Forward

School to Make Own Electricity with Solar Arrays

Scana Inks Propulsion Deals


Earl’s Pearl of the Day:"You drown not by falling into a river but by staying submerged in it.” — Paulo Coelho








December 14, 2012

New JIP Seeks to Explore Arctic Oil Spill Response Technology

A number of research projects into Arctic oil spill response technology are underway thanks to a joint industry program (JIP) that officially launched in January of this year.

The Arctic Oil Spill Response JIP, under the auspices of the International Association of Oil and Gas Producers, will conduct research over a four-year period in six areas related to oil spill response preparedness, including dispersants, environmental effects, trajectory modeling, remote sensing, mechanical recovery and in-situ burning. Research projects being conducted under the JIP include the fate of dispersed oil under ice, dispersant testing under realistic conditions, and oil spill detection and mapping in low visibility and ice.

For more information, click here.

Today's Links

Dow Chemical Opens New Facility in Chicago

Helix to Sell Oil and Gas Assets

Last Phase of Slip C Dredging Project at Port Fourchon Complete

TGS Begins 3-D Shoot in Central U.S. Gulf


Earl’s Pearl of the Day: "If you want the present to be different from the past, study the past.” — Baruch Spinoza








December 13, 2012

UK Lifts Shale Gas Fracking Ban

UK Energy and Climate Change Secretary Ed Davey announced Thursday the government has allowed the resumption of exploratory hydraulic fracturing (fracking), but any fracking activities would be subject to new controls to mitigate the risks of seismic activity.

The news follows the Chancellor of the Exchequer’s Autumn Statement on Dec. 5 in which he announced plans to better exploit the UK’s gas resources and the Department of Energy and Climate Change would establish an Office for Unconventional Gas and Oil.

Exploratory fracking has been suspended in the UK since May 2011 after two small seismic tremors were detected near the country’s only fracking operation in the Bowland Basin to the east of Blackpool in Lancashire, northern England. On Monday this week, Rigzone reported that the British Geological Society believes shale deposits under Blackpool are 50-percent greater than previously thought at 300 trillion cubic feet of gas.

For more information, click here.

Today's Links

Feds Auction Prime California Land for Oil Development

Tesoro to buy pipeline, terminals

Texas Offshore Wind Project Wins Federal Grant

Brazil’s Remote Fossil Fuel Reserves Encourage FPSO Industry


Earl’s Pearl of the Day:"Kind words can be short and easy to speak, but their echoes are truly endless.” — Mother Teresa









December 12, 2012

Shell Looks to Renewable Energy to get at Fossil Fuel

One of the world’s largest oil companies, Royal Dutch Shell,has invested in a Fremont, Calif., start-up that uses solar power to squeeze petroleum from aging oil fields.

GlassPoint Solar’stechnology generates high-pressure steam to heat oil underground, helping it flow to the surface. The company is announcing Tuesday it has raised $26 millionin its latest financing round.

In addition to Shell, other investors include RockPort Capital,Nth Powerand Chrysalix Energy Venture Capital.

Founded in 2008,GlassPoint last yearinstalled one of its systems in Kern County, Calif. Shell’s involvement could someday help the start-up take its technology worldwide.

For more information, click here.

Today's Links

Rosneft Buys Other Half of TNK-BP for $28 Billion

BHP Sells Australia Gas Stake to PetroChina

Petronas Aims to Create Thousands of Jobs in Canadian Gas Industry

First LNG-Fueled Hydraulic Fracturing Completed in Eagle Ford Play


Earl’s Pearl of the Day: "Four things for success: work and pray, think and believe.” — Norman Peale










December 11, 2012

Dow Chemical Seeks U.S. Permit for Biggest Ethylene Plant

Dow Chemical applied for a federal permit to build the company’s biggest ethylene plant as cheap natural gas gives manufacturers a cost advantage.

The plant in Freeport, Texas, would have capacity to make 1.5 million tons of ethylene a year, Nancy Lamb, a Dow spokeswoman, said today by phone. That’s the same size as Texas ethylene plants proposed by Chevron Phillips and ExxonMobil and it would be Dow’s largest in the world, according to data compiled by Bloomberg.

For more information, click here.

Today's Links

Spectra Buys Express Platte Pipeline for $1.49 Billion

Tullow Buys Spring Energy Norway

Titanium Explorer Begins U.S. Gulf Operations

Jacobs Wins Santos GLNG Gig


Earl’s Pearl of the Day: "The only limit to your impact is your imagination and commitment.” — Tony Robbins












December 10, 2012

Western States Look to Capitalize on Energy Boom

Petroleum producers in southeastern New Mexico are on track to pump out 80 million barrels of oil this year — numbers that haven’t been seen since the 1970s.

In Texas and North Dakota, the oilfields are booming. Companies are exploring possible shale plays in more pockets around the West, and there are no signs that Wyoming stands to lose its position as the nation’s top coal producer.

Federal projections released this week by the U.S. Energy Information Administration suggest the next three decades will see similar flurries of domestic energy development as technology improves and pressures mount to reduce America’s reliance on Mideast oil, and the West will be a player.

For more information, click here.

Today's Links

Fracking Survey Finds Support in Unexpected Places

Drilling Company Looks High and Low for Workers

Wintershall Spuds Rodriguez Well

Ugandan Parliament Passes Long-Awaited Oil Bill


Earl’s Pearl of the Day: "You are never too old to set another goal or to dream a new dream.” — C.S. Lewis








December 7, 2012

Enbridge Proceeding with $6.2 Billion Pipeline Expansion

Enbridge Corp. said it will proceed with a $6.2 billion program to increase pipeline capacity to open North Dakota and western Canada light oil production to expanded markets.

The company said its Light Oil Market Access Program will provide access from the Enbridge system to refinery markets in Ontario, Quebec and the U.S. Midwest for an additional 400,000 barrels per day.

The project involves increasing pipeline capacity on Enbridge’s North Dakota regional system, expanding capacity on the U.S. mainline system and enhancing Canadian mainline terminal capability.

For more information, click here.

Today's Links

China Announces Potential Winners of Shale Gas Block Auction

Noble Energy Looks to Colorado Shale

Exxon and Rosneft Plan Tight Oil JV

PKN Picks Up Polish Shale Gas Blocks


Earl’s Pearl of the Day:"He who believes is strong; he who doubts is weak. Strong convictions precede great actions.” — J.F. Clarke







December 6, 2012

U.S. Gas Exports Clear Hurdle

Shipping some of the newly abundant U.S. natural gas overseas would benefit the nation’s economy more than keeping it all at home, according to a long-awaited government study that has the potential to reshape the global energy market.

The endorsement could turn the tide in a politically sensitive issue. Gas producers are eager to export more, while big consumers including manufacturers and chemical companies are leery that exports could raise domestic prices. Environmental groups, meanwhile, fear that allowing exports would encourage more natural-gas production.

The administration had said the study would be central to its decision on approving exports. It analyzed more than a dozen scenarios for U.S. production and exports of natural gas. It found that "across all these scenarios, the United States was projected to gain net economic benefits” from liquefying and then exporting natural gas.

For more information, click here.

Today's Links

U.S. Expected to Reduce Energy Import Gap to 9 Percent by 2040

Government Report Predicts Big Economic Boost from Natural Gas Exports

Total Hits Oil Pay in Gulf of Mexico

How Fracking Could Save the Dollar


Earl’s Pearl of the Day: "Don’t be afraid to go out on a limb. That’s where the fruit is.” — H. Jackson Browne











December 5, 2012

Rural America Already Enjoying the Oil Boom

United States oil production is running at a 15-year high, and the boom is boosting incomes in the heartland.

Official data shows crude-oil production reached its highest level in nearly 15 years in September, with average daily production of nearly 6.5 million barrels,"The Wall Street Journal” says.

And small-town America is feeling the benefit most. While city- and suburb-dwellers haven’t recovered the spending power lost in the slump, people in towns and rural areas are enjoying an advance in income, thanks in part to the expansion of energy production.

For more information, click here.

Today's Links

Tools without Sparks Could Save Lives Offshore

Oil Rises as Optimism About U.S. Economy Grows

Asia’s Thirst for Natural Gas Fuels Investment Opportunities

Lukoil to Drill Five African Wells in 2013


Earl’s Pearl of the Day: "Success isn’t measured by money or power or social rank. Success is measured by your discipline and inner peace.” — Mike Ditka










December 4, 2012

Canadian Official Pushes Strong Energy Trade with United States

Open markets and more pipelines are necessary to make North America the world’s new Saudi Arabia of energy supply, panelists said during a Manhattan Institute discussion Monday.

Speaking during the panel discussion, John Prato, consul general of Canada in New York, encouraged the United States to capitalize on rapidly growing oil production in Canada — even as the U.S. expands its own oilfield activity — to maintain "the largest trading relationship in the world.”

The U.S.-Canadian energy trade is worth more than $100 billion annually, according to the Energy Information Administration.

For more information, click here.

Today's Links

Tuesday Hearing on New Nebraska Pipeline Planned

Graduate Focus for North Sea Oil and Gas Firms

Husky "On Track” with New Business Initiatives

Subsea 7 Bags Lianzi Topsides Gig


Earl’s Pearl of the Day: "Discipline is the bridge between goals and accomplishment.” – Jim Rohn







December 3, 2012


Luring Top Oil Talent Demands Perks

Skyrocketing demand for petroleum engineers and other oil and gas workers has companies going to new lengths to lure top talent and keep employees out of competitors’ grasps.

Winning over recruits isn’t just a matter of providing 35-percent salary hikes and $100,000 signing bonuses. Headhunters say company culture and nonmonetary perks are gaining sway in attracting and retaining employees.

For more information, click here.

Today's Links

BP Emphasizes Improved Safety Culture

Eagle Ford Emerges as a Top Play

Woodside Buys Stake in Major Gas Discovery Offshore Israel

Pertamina Hulu Energi Finds New Oil and Gas Reserves Offshore East Java


Earl’s Pearl of the Day: "Don’t be afraid to give your best to what seemingly are small jobs.” — Dale Carnegie










November 30, 2012

Fracking Companies Embrace Solar to Cut Carbon Emissions

The vast majority of hydraulic fracturing sites in the United States are powered by emissions-spewing, noisy diesel engines.

So, Ron Hyden, who’s seen a lot during his four decades in the oil patch, is eager to show off something new: a machine used in fracking that relies on gravity and electricity generated from solar panels to send sand into a labyrinth of tubes before it’s shot underground to prop open tiny cracks in natural gas- or oil-bearing rock.

For more information, click here.

Today's Links

High-Tech, Energy Efficient Home will be in Historic Neighborhoods

Oil Heads for First Monthly Gain Since August on Economy

Rosneft to Boost Energy Development in Russian Far East

Sound Oil on Track for First Gas Sales


Earl’s Pearl of the Day: "You don’t always get what you wish for, you get what you work for.” — Unknown








November 29, 2012

Energy Future Remains Positive

The need for more energy – from freeways to battlefields – could be slashed by making fossil-fuel burners more efficient and making renewables more dependable, speakers at a Houston conference said.

A prime example cited is the automobile engine. Lawrence Burns, a former General Motors executive who is now director of the program on sustainable mobility at Columbia University, said 75 percent of the energy generated by cars is lost as heat and friction, and much of the remainder is used to move heavy components, leaving enormous potential to boost fuel efficiency.

Only 1 percent of the energy generated by vehicles is used to move drivers, he said.

For more information, click here.

Today's Links

Room for Feds and States in Regulation of Hydraulic Fracturing

France Can Frack Without Destroying Environment

Norway Oil Services Firms Thinks They Can Handle Record Demand

Wood Group Kenny Wins Rosebank FEED


Earl’s Pearl of the Day: "Shun idleness. It is the rust that attaches itself to the most brilliant metals.”­ — Voltaire







November 28, 2012

Upstream Capital Will Reach historic Peak in 2012

While the rest of the economy is still recovering sluggishly, expected investment in upstream capital spending is at a record high of $550 billion for 2012, according to a recent report by Wood Mackenzie.

Confidence in high oil prices and new opportunities worldwide have pushed capital development spending $55 billion higher than in 2011 and $120 billion higher than pre-recession investment in 2008, the report said. This growth, however, has been driven largelyby North American investment in unconventional reservoirs, with investment in other markets slowing.

For more information, click here.

Today's Links

Ad Campaign Pushes for NY Gas Drilling, Fracking

NeoScope Harnesses Nuclear Power to Enhance Drilling Measurements

Kea Spuds Puka 2 Well in New Zealand

Imperial in on Celtic Acquisition Act


Earl’s Pearl of the Day: "Fear not that your life will someday end. Fear only that you do nothing with it.” — Anonymous








November 27, 2012

T.D. Williamson Inks Global Services Contract with BP

T.D. Williamson (TDW), a world leader in pipeline services and equipment, announced it has signed a global pipeline intervention and isolation services contract with BP.

Activities covered by the agreement include hot tapping and STOPPLE plugging as well as SmartPlug pressure isolation. The three-year contract earned by TDW is one of only four such contracts awarded worldwide by BP.

For more information, click here.

Today's Links

U.S. Scientists Find Lessons from Japan Nuke Crisis

First Reserve Acquires Stake in Ameriforge

Petronas Discovers More Than 4 TCF of New Gas Reserves Offshore Sarawak

Cameron Secures Drillship Package Work


Earl’s Pearl of the Day: "Life is too short not to make the best and the most of everything that comes your way every day.” — Sasha Azevedo









November 26, 2012

Natural Gas Drillers Target U.S. Truck, Bus Market

Surging gas production has led the drilling industry to seek out new markets for its product, and energy companies, increasingly, are setting their sights on the transportation sector.

Touting natural gas as a cheaper, cleaner-burning alternative to gasoline and diesel, drillers, public utilities and government officials are trying to boost demand for natural gas buses, taxis, shuttles, delivery trucks and heavy-duty work vehicles of all sorts, while simultaneously encouraging development of the fueling infrastructure that will be needed to keep them running.

The economics are compelling. Natural gas costs about $1.50 to $2 per gallon equivalent less than gasoline and diesel. That can add up to tens of thousands of dollars in savings for vehicles that guzzle the most fuel.

For more information, click here.

Today's Links

Baker Hughes Using Natural Gas in Fracturing Jobs

Cameron Wins $275 Million Deepwater Drillship Equipment Contract

ConocoPhillips to Sell Kazakh Waters Interest; Expects Proceeds of $5 Billion

Lundin Makes Small Oil Discovery in Barents Sea


Earl’s Pearl of the Day: "If you have time to whine and complain about something then you have the time to do something about it.” — Anthony J. D’Angelo










November 21, 2012

Industry Vet Sets Sights on Marcellus 2.0

In the latter part of the previous decade, attractive natural gas wellhead prices and technological advances in exploiting shale formations prompted an exodus to Appalachia. Some of the companies flocking to the Marcellus shale formation and its enormous store of natural gas willingly paid landowners several thousand dollars per acre merely to stake their claim and, when the time was right, flip their leaseholdings for a handsome profit to another speculator or to an operating company.

For a number of these companies seeking to cash in, the big payoff never came. Plummeting natural gas prices made acquiring acreage in a largely dry gas play much less appealing. Speculators caught up in the initial rush to the Marcellus found themselves saddled with overpriced leaseholdings that were not generating income.

In the view of one long-time observer of U.S. oil and gas industry trends, the "bubble” that characterized much of the activity in the Marcellus in recent years has not burst per se. Rather, Raymond Schmaus maintains the bubble has morphed into a more stable and predictable environment that favors the long-term investor. The president of the Pittsburgh-based oil and gas title abstract firm Armstrong Search Associates Inc. welcomes this change, which he said favors operating companies looking to maintain a lasting presence in the Marcellus and the overlapping, liquids-rich Utica shale formations.

For more information, click here.

Today's Links

Oil Friendly Texas Also Gives Howdy to Renewables

50-Acre Solar Array Would Power 10,000 Homes

Petronas, Progress Energy Extend Tie-Up as They Seek Approval

Lundin Hits Gas Off Malaysia


Earl’s Pearl of the Day:"Enlightenment is not a peak experience. It is a permanent shift in paradigm that deepens day by day.” — Shizen Young





November 20, 2012

Magnolia Spuds First Operated Well in Oklahoma

United States onshore-focused Magnolia Petroleum reported Tuesday it has spud its first well as operator in the Mississippi Lime Formation, Oklahoma.

The company said it began drilling at the Roger Swartz No. 1 well, located in Noble County, Okla., on Nov. 19. Drilling is expected to last between eight and 10 days and cost an estimated $730,000. Its targeted total depth is 5,500 feet.

Magnolia’s directors believe a further seven potential well sites could exist in the vicinity of the well, which lies in 800 acres Magnolia acquired in February this year. Magnolia, which currently has a 100-percent interest in the well, has made a farm-in deal in which third parties can acquire a 16.25-percent working interest once a pay out has been achieved.

For more information, click here.

Today's Links

Total Sells Nigeria Offshore Oil Stake for $2.5 Billion

WestSide Receives $192.4 Million Takeover Bid from Undisclosed Party

Shell Flows First Oil from Gumusut-Kakap

Statoil Signs Gas Supply Agreement


Earl’s Pearl of the Day: "The man who wins is the man who thinks he can.” — Vince Lombardi





November 19, 2012

Crowning Glory for Santos

The company said the pay was confirmed by wire line logging in the Jurassic-aged Montara, Plover and Malita reservoirs between 4,873 and 4,998 meters.

In addition, multiple condensate-bearing gas samples were recovered and pressure data had indicated that gas was expected to flow at a high rate.

Santos Head of Exploration Bill Ovenden said Crown-1, which had previously been described by the company as "LNG-scale,” was an important gas discovery for the company.

"The Crown discovery is well positioned, in close proximity to existing and proposed LNG projects in the Browse basin and other material exploration prospects,” he said in a statement on Monday.

Crown-1 is located in Block WA-274-P, which is operated by Santos with a 30-percent interest. It is partnered with Chevron and Inpex.

For more information, click here.

Today's Links

 

Gas Drilling Presents Obama with Historic Choices

Iran Starts Building Gas Pipeline to Syria

BP Scoops Up Four Blocks Offshore Canada

Subsea 7 Revenues Rise on High Offshore Activity


Earl’s Pearl of the Day: "Leadership is getting someone to do what they don’t want to do, to achieve what they want to achieve.” — Tom Landry


 







November 15, 2012

Reaping the Benefits of Natural Gas Will Require Action Now

Reports about the game-changing nature of the country’s natural gas reserves, newly recoverable with the combination of hydraulic fracturing and horizontal drilling, seem to come out every week.

But Marc S. Lipschultz, global head of energy and infrastructure for KKR & Co., said the ability to reap the economic benefits are far from assured.

Among the key challenges, he said, are smoothing the boom-and-bust cycles in gas prices and mitigating the environmental impacts of gas drilling that limit social acceptance.

For more information, click here.

Today's Links

Fulbright & Jaworski Energy Practice Powers Merger with British Firm

Statoil Upbeat on ‘Hot’ East African Projects

Canada Oil Sands Continue to Gain Global Attention

Former Shale Foe Makes Deal to Allow Drilling on Her Historic Farm


Earl’s Pearl of the Day:"Don’t cheat the world of your contribution. Give it what you’ve got.” — Steven Pressfield






November 14, 2012

Clough Amec Inks Chevron Deal

The 12-month contract extension covering oil facilities at Barrow and Thevenard islands off Onslow, Western Australia is worth in excess of $20.9 million to Clough Amec.

It is the second one-year extension to an initial three-year contract inked in 2008.

"The scope of work includes conceptual studies, front-end engineering design, detailed engineering, procurement support, development of construction work packs and construction planning,” the joint venture partners said.

For more information, click here.

Today's Links

‘It’s Up To Us’ on Shale Boom, Energy Leader Says

Ohio Renews Injection-Well Permitting

Shell in Asset Swap with Murphy

Dolphin on Seismic Profits Roll


Earl’s Pearl of the Day: "If you have everything under control, you're not moving fast enough.” — Mario Andretti








November 13, 2012

United States on Course to Regain World Oil Crown

In a turnaround that would have seemed far-fetched a few years ago, the United States is projected to surpass Saudi Arabia as the world’s top oil producer by 2020 while cutting its own energy use faster than any other nation, the International Energy Agency reports.

The agency’s "World Energy Outlook 2012” published Monday projects the United States to remain the world’s top oil producer until the late 2020s. Experts said that would be an economic boon for the national and the Houston economies.

The energy agency cited a combination of industry innovations and government efficiency mandates for the coming changes in the United States, far different from the era of shrinking oil production and gas-guzzling SUVs in the early 2000s.

For more information, click here.

Today's Links

Blackstone, LLOG Agree on $1.2 Billion Gulf of Mexico Oil Deal

LSU to Offer Specialized Study in Energy Law

Indonesia Opens Its Doors to New Oil and Gas Investments

Kuwait to Invest $56 Billion on Oil and Gas Expansion Over Five Years


Earl’s Pearl of the Day: "No matter how many goals you have achieved, you must set your sights on a higher one.” — Jessica Savitch





November 12, 2012

Alaska Ice Tested as Possible Energy Source

A half mile below the ground at Prudhoe Bay, above the vast oil field that helped trigger construction of the trans-Alaska pipeline, a drill rig has tapped what might one day be the next big energy source.

The U.S. Department of Energy (DOE) and industry partners over two winters drilled into a reservoir of methane hydrate, which looks like ice but burns like a candle if a match warms its molecules. There is little need now for methane, the main ingredient of natural gas. With the boom in production from hydraulic fracturing, the United States is awash in natural gas for the near future and is considering exporting it, but the DOE wants to be ready with methane if there’s a need.

For more information, click here.

Today's Links

A prediction: Shale Oil Plays Will Grow for Decades

Drilling Boom, Retirements Create Need for Energy Workers

Providence Says Drombeg Could Contain 870 Million Barrels

Wentworth Pushes Ahead with Mnazi Bay


Earl’s Pearl of the Day:"Goals are the fuel in the furnace of achievement.” — Brian Tracy








November 9, 2012

How Shale Gas is Reshaping the Oil Market

The Organization of the Petroleum Exporting Countries is sending mixed messages on the shale gas boom.

On the one hand,as Dow Jones Newswires reports, the producer group doesn’t seem particularly concerned. On the other,as Reuters notes, it has at least acknowledged that the huge amounts of shale oil and gas coming onto the market—particularly in the United States—are changing the global supply picture.

"The Wall Street Journal” reports how the U.S.’s reliance on OPEC’s oilwill fall significantly in the coming yearsalthough, due to the cost of extracting domestic unconventional oil.

For more information, click here.

Today's Links

Halliburton Expands Facility to Offer ‘Real World’ Testing for Perforating

NADBank Expands Renewable Energy Portfolio

Chronicle Names Top Workplaces

Subsea 7 Wins Gullfaks C Contract


Earl’s Pearl of the Day: "You just can’t beat the person who never gives up.” — Babe Ruth






November 8, 2012

U.S. Oil Production Sets New Record

U.S. oil production rose to its highest point in almost 18 years as a shale drilling boom cut reliance on foreign fuel and nudged the country closer to energy independence.

Output swelled by 8,000 barrels to 6.68 million barrels a day in the week ended on Nov. 2, the Energy Department reported. It was the most since Dec. 23, 1994. Improvements in horizontal drilling and hydraulic fracturing, or fracking, have unlocked fuel trapped in deep underground rock formations in states such as North Dakota, Texas and Oklahoma.

For more information, click here.

Today's Links

Sandy Offers Energy Lessons

Industry Looks Ahead to a Second Term Under Obama

Gulf of Mexico is in a Growth Mode — Will it Continue?

Hallin Starts Work in Indonesian Field


Earl’s Pearl of the Day: "Once a word leaves your mouth, you cannot chase it back even with the swiftest horse.” — Chinese Proverb









November 7, 2012

Encana, Nucor Ink Gas Drilling, Supply Agreement

Charlotte, N.C.-based steel product manufacturer Nucor Corp. has entered a long-term agreement with Encana Oil & Gas to conduct a U.S. onshore natural gas drilling program.

Nucor believes the agreement will provide the company with a reliable, low-cost supply of natural gas for its current and future gas needs for more than 20 years, Nucor said in a statement Tuesday.

The agreement calls for Nucor to pay its share of costs plus an additional amount of carried interest as each well is drilled, subject to a cap on carry paid for each well and a cap on total carried interest. Drilling may be suspended by either Nucor or Encana if U.S. domestic gas prices fall below a predetermined threshold.

For more information, click here.

Today's Links

Vietnam Moves on Oil Refinery and Nuclear Plant

Two Energy Producers Please Investors

Crude Surges 3.6-Percent Higher

Chevron’s Cambo-5 Well a Go


Earl’s Pearl of the Day: "Success isn’t something that just happens — success is learned, success is practiced and then it is shared.” — Sparky Anderson









November 6, 2012

ExxonMobil Continues Sandy Support in Relief, Recovery

ExxonMobil continues to work to support distribution of gasoline and fuel throughout the areas affected by Hurricane Sandy and is donating $1 million to the American Red Cross for disaster relief assistance in New York, New Jersey and the Caribbean.

"Hurricane Sandy has had a devastating impact on people and communities along the east coast and in the Caribbean,” said ExxonMobil Vice President of Supply and Transportation Andrew W. Madden. "It’s our hope that ExxonMobil’s donation to the Red Cross will help provide comfort to those affected and help people rebuild their lives as quickly as possible.”

ExxonMobil’s three terminals in Massachusetts and Rhode Island are operating normally and the company does not own or operate any gas stations, fuel terminals or refineries in the impacted areas. ExxonMobil has been working with distributors, suppliers and local, state and federal agencies to re-establish the fuel supply infrastructure.

For more information, click here.

Today's Links

Marathon Oil Profits Rise on Higher Production

Indonesian Government to Boost Oil Production by 2014

Total in ‘Danish Shale Gas Foray’

Petroceltic Planning 10 Wells


Earl’s Pearl of the Day: "I don’t do things half-heartedly. Because I know if I do, then I can expect half-hearted results.” — Michael Jordan







November 5, 2012

SapuraKencana Petroleum Buys Seadrill’s Tender Rig Business for $2.9 Billion

SapuraKencana Petroleum is buying Seadrill’s rigs business, including its full tender rig organization, for an enterprise value of $2.9 billion, Seadrill said Monday in a statement.

The total enterprise value includes $363 million in remaining capital expenditure linked to a newbuilds program and all the debt in Seadrill’s tender rig business, which is approximately $800 million as of Dec. 31, 2012.

A non binding memorandum of understanding signed on Monday could see SapuraKencana Petroleum taking control of an enlarged rig business, which is comprised of 16 tender rigs in operation, and an additional five units currently under construction. The operating rigs and newbuilds are currently contracted under long-term fixed price contracts with Chevron, Shell, PTTEP and Petronas Carigali.

For more information, click here.

Today's Links

Why Not a ‘Lewis and Clark Project’ for Energy?

China Looks to Boost Natural Gas Supply Through Shale Gas Subsidies

Inpex Plunges into Indian Deep Water

BG Inks New $3 Billion Loan


Earl’s Pearl of the Day: "Every saint has a past. Every sinner has a future.” — Warren Buffet









November 2, 2012

American Public Supports Oil and Gas Development on Public Lands

Released in July of last year, Western Energy Alliance’s "Blueprint for Western Energy Prosperity” found that by 2020, just six oil and natural gas producing states in the West could produce as much oil and natural gas on a daily basis as the U.S. imports from Russia, Iraq, Kuwait, Saudi Arabia, Venezuela, Algeria, Nigeria and Colombia combined. This energy production could result in a doubling of investment in the region to the tune of $58 billion annually allowing direct, indirect and induced jobs to increase by 16 percent. Federal government policies, however, are significantly undermining these projections of growth, investment and expansion. The blueprintidentifies government policies that are making western energy development increasingly more difficult, time consuming and expensive, and recommends policies to overcome those obstacles.

Building upon the foundation of these dramatic production and economic findings, the Alliance turned to the Tarrance Group, a nationally recognized polling and research firm, to conduct public opinion research of 1,000 high-performing voters in Colorado, Montana, New Mexico, North Dakota, Utah and Wyoming. The results have given the Alliance new and valuable insight into the public’s view on energy development, energy security and the Obama Administration’s management of our nation’s energy policy. The Alliance is busy rolling out the key finding to elected officials and interested stakeholders.

"Seventy-two percent of those surveyed support increased energy development on public lands — and 56 percent strongly support it,” said Tim Wigley, president of Western Energy Alliance. "That’s an overwhelming number of Westerners who want the economic benefit oil and natural gas development brings. It also shows the public is tuned into energy issues in 2012.”

For more information, click here.

Today's Links

 

Alternative Energy Isn’t Dying

Gas Boom Means U.S. Exports Grow at Fastest Rate Since ‘70s

Indonesia Green Lights BP’s Proposed $121 Billion LNG Train

SapuraKencana Lands Contract Double


Earl’s Pearl of the Day:"If you want to live a healthy life, tie it to a goal, not to people or objects.” — Albert Einstein


 







November 1, 2012

Siemens Prepping Workers for Future U.S. Manufacturing Surge

In recent debates preceding next month’s U.S. presidential election, President Barack Obama and Republican presidential contender Mitt Romney have both pitched plans to revive the U.S. economy through the creation of high-tech, high-paying technical jobs.

While significant demand exists in the United States for highly skilled manufacturing jobs, attracting employees to fill its existing and future work force presents a challenge for Siemens as it seeks employees with skills in science, technology, engineering and math (STEM), said Doug Keith, president of Siemens Corp.’s Drive Technology Division, in an interview with Rigzone.

Workers with STEM skill sets are needed to fill Siemens’ power engineering positions; these jobs tend to stay open the longest due to availability of suitable candidates, Keith said. Power engineering is a subfield of energy engineering that deals with the generation, transmission and distribution of electric power and electrical devices such as motors. These motors are used to power energy infrastructure from drilling rigs to pipelines and downstream equipment.

For more information, click here.

Today's Links

Full Steam Ahead on Keystone

Cheap Natural Gas Fuels Plant Expansions

Shell Sees Net Profits Rise

Statoil Extends Aker Gig


Earl’s Pearl of the Day:"Nobody can go back and start a new beginning, but anyone can start today and make a new ending.” — Maria Robinson










October 31, 2012

Drilling Permits Up as Gulf Trends Toward Bigger, Deeper Facilities

Two years after the blowout of BP’s Macondo well killed 11 workers, unleashed the nation’s worst environmental disaster and triggered a five-month halt on much offshore oil drilling, that activity has rebounded in the Gulf of Mexico, according to a report issued Wednesday.

The analysis by Quest Offshore concludes that the pace of government approvals of Gulf drilling permits has been climbing over the past six months and now is back to pre-Macondo levels. According to the research firm, the Interior Department signed off on 78 new exploration drilling permits and 36 new development drilling permits over the past year.

For more information, click here.

Today's Links

BP Works through Uncertainty

Shell Concludes Inaugural Arctic Drilling Season

African Successes for Afren and Tullow

Cameron Booms in Third Quarter

Earl's Pearl of the Day: "We learn wisdom from failure much more than success. We often discover what we will do, by finding out what we won't do." - Samuel Smiles





October 29, 2012

Seawater Gives New Life to Oil Wells in Gulf

Deepwater drillers are pushing the boundaries of modern technology to help revive the Gulf of Mexico as one of the world’s most prolific oil producers.

In offshore frontiers hit by the 2010 oil spill and drilling moratorium, pioneers are adapting water injection, an old technique for boosting oil recovery, to challenging new environments in the deepest drilling regions of the Gulf. By flushing massive loads of high-pressure water through miles of ocean and earth, they’re stimulating the deepest reservoirs and bringing up more oil.

The technique has been used for decades on land to enhance oil recovery. But applied far at sea, it can be an especially pricey and complex venture. As technology advances, oil companies are applying injection to their most expensive offshore projects, making deepwater fields more economic by sweeping crude out of reservoirs’ hardest-to-reach crevasses.

For more information, click here.

 

How Sandy’s Affecting Energy Markets

They’re Making Deals in the Oil Field

Eagle Ford Jobs to Grow, Evolve as Play Enters Production Phase

Beach Starts Shale Fracking Campaign


Earl’s Pearl of the Day: "There are no shortcuts to any place worth going.” — Beverly Sills


 





October 25, 2012

Chevron Hits More Oz Gas

The US supermajor made the latest find at its Satyr-4 exploration well after drilling to a total depth of 4579 metres, it said on Thursday.

Chevron, which operates Block WA-374-P with a 50% share, found a net gas column of around 67 metres after drilling in a water depth of 1088 metres some 120 kilometres north-west of Barrow Island.

For more information, click here.

Today's Links

Oil Rises 7 Percent After Fall Last Week

Voters Should Educate Selves about Energy

Shell Buys Beryl Fields in North Sea

PGS’ Profits Surge Beat the Street


Earl’s Pearl of the Day: "If what you did yesterday seems big, you haven’t done anything today.” — Lou Holtz






October 24, 2012

Unconventional Plays to Support Nearly 3.5 Million Jobs by 2035

The entire upstream unconventional oil and gas sector will support more than 1.7 million jobs in 2012 at average wage levels - dramatically higher than the general economy, according to a new IHS Global Insight report released Tuesday.

The number of jobs supported by upstream unconventional activity is expected to grow to 2.5 million over the next three years, 3 million in 2020, and reach nearly 3.5 million in 2035, according to the report "America's New Energy Future: The Unconventional Oil and Gas Revolution and the Economy".

For more information, click here.

Today's Links

Oil Jobs Expected to Flow into San Antonio

Who Might Lead Energy, Interior and EPA Under Romney, Obama

China’s CBM Industry to Grow on Rising Natural Gas Needs

Statoil Appraisal Positive for Peregrino II


Earl’s Pearl of the Day: "If you can’t excel with talent, triumph with effort.” — Dave Weinbaum








October 23, 2012

Shell, Exxon to Drill Fram Field after Reducing Costs

Royal Dutch Shell and Exxon Mobil agreed to develop the Fram oil and gas field in the U.K. North Sea after managing to reduce drilling costs.

The partners plan to convert a tanker into a floating production, storage and off-loading vessel, or FPSO, to begin extraction within three years, Shell Vice President Glen Cayley said by telephone. Fram will reach peak output of about 35,000 barrels of oil equivalent a day within two years of starting.

For more information, click here.

Today's Links

Unconventional Oil and Gas to be Economic Driver

Public Officials to Discuss Future of Energy Jobs at Pre-Election Forum

WGP Completes Arctic 2D Seismic Survey

Maersk Secures $694 Million Contract


Earl’s Pearl of the Day: "If you aren’t going all the way, why go at all?” — Joe Namath





October 19, 2012

Exxon Talking with Oil Majors to Sell South Iraq Stake

Exxon Mobil is in talks to sell its stake in a contract to develop a multibillion-dollar oil project in southern Iraq as it gears up to start drilling for oil in the Iraqi Kurdistan region, people familiar with the matter said Thursday.

The U.S.-based energy giant's move to exit southern Iraq and push forward with its plans in the northern Kurdistan region suggests the central government's efforts to keep ExxonMobil operating solely in southern Iraq are likely to fail. This comes as talks between the Kurdistan Regional Government, or KRG, in Erbil and the federal government in Baghdad, aimed at resolving differences over oil rights, appear to have stalled again after a brief period of progress.

ExxonMobil is negotiating with international oil companies to take over its service agreement to develop the massive West Qurna-1 oil field in southern Iraq, one person familiar with the Iraqi oil ministry and another person familiar with ExxonMobil's operations in Kurdistan said Thursday.

For more information, click here.

Today's Links

Baker Hughes Expects Improvement in International Margins

Schlumberger Third Quarter Profit Rises on Strong Revenue

Natural Gas: Smart Power, Smart Politics

Turkmen Offshore to See 80-Percent Investment Boost


Earl’s Pearl of the Day: "Go in the direction of your dreams. Live the life you’ve imagined.” — Thoreau







October 18, 2012

Kinder Morgan Energy Partners Profit Soars

Oil and natural gas pipeline and storage titan Kinder Morgan Energy Partners reported Wednesday that its third-quarter profit soared 76 percent on a nearly 11 percent increase in revenue.

The company said its net income totaled $379 million, or $1.26 per distribution unit, compared with $215 million, or $1.16 a unit, a year earlier.

Kinder Morgan Energy Partners reported third-quarter distributable cash flow before certain items of $455 million, up 15 percent from $394 million for the comparable period in 2011. Distributable cash flow per unit before certain items was $1.28 compared to $1.19 for the third quarter last year, the firm said.

Revenue in the quarter rose to $2.34 billion, compared with $2.11 billion a year earlier.

For more information, click here.

Today's Links

First Oil Nears for Kazakhstan’s Supergiant Field

Exxon’s Biggest Canada Deal Signals Shale Rush

Aker Wins Shetland Gas Plant Contract

Wood Group Scoops Pipeline Project


Earl’s Pearl of the Day: "It’s repetition of affirmations that leads to belief. And once that belief becomes a deep conviction, things begin to happen.” — Muhammed Ali






October 17, 2012

Exxon to Buy Alberta’s Celtic For $2.91 Billion

Exxon Mobil, the largest U.S. energy company, agreed to buy Celtic Exploration for $2.86 billion in cash and stock, adding production in Alberta’s Montney and Duvernay shale.

Celtic’s shareholders will receive $24.50 a share and half a share of a new company that will hold assets not included in the agreement, Calgary-based Celtic said today in a statement. The cash value per-share represents a 35 percent premium to Celtic’s closing price yesterday.

The purchase includes 545,000 net acres in the Montney shale and 104,000 acres in the Duvernay, plus other Alberta land. Current production on the acreage is 72 million feet of natural gas a day and 4,000 barrels a day of oil and natural gas liquids.

For more information, click here.

Today's Links

Aker Wins Shetland Gas Plant Contract

Brazil Oil Workers Approve Petrobras Wage Contract

UAE Shah Gas Project on Track for 2014

Steffy: A Few More Thoughts About Drilling on Public Lands


Earl’s Pearl of the Day: "The mind is its own place, and in itself, can make Heaven of Hell and Hell of Heaven.” — John Milton








October 16, 2012

Eagle Ford Emerges as Top Player

The Eagle Ford Shale started as a natural gas play around mid-2010, and if it has stayed that way, there wouldn’t be so much talk about it.

But as natural gas prices fell, the industry within a year had switched gears in South Texas, focusing instead on extracting the more profitable crude oil and natural gas liquids from the shale rock.

That play-within-a-play characteristic of the Eagle Ford Shale is making it a premier shale play, speakers said Monday at Hart Energy’s third annual DUG Eagle Ford Conference at the Convention Center.

For more information, click here.

Today's Links

 

Robot Submarine Seeks Oil Sheen Source Near Deepwater Horizon Site

Most Eligible Parties Will Accept Spill Deal

Investment Confidence Returning to UK Continental Shelf

Repsol Date for Darwin Probe


Earl’s Pearl of the Day: "Shallow men believe in luck. Strong men believe in cause and effect.” — Ralph Waldo Emerson


 







October 15, 2012

Houston, Where Energy Conferences Just Don’t Stop

If you pay attention to oil and gas - and in Houston, a lot of people do - you probably already know about OTC and CERAWeek.

The Offshore Technology Conference and the conference sponsored by IHS-Cambridge Energy Research Associates are held every spring, drawing thousands of energy professionals to town.

But October is turning out to be pretty buzzy, too, with conferences, a trade show and even an energy-themed family day planned for the plaza in front of Houston's City Hall.

Energy Week will kick off with a two-day conference and trade show focused on technology for independent oil and gas producers, set for Wednesday and Thursday at the George R. Brown Convention Center.

For more information, click here.

Today's Links

Titanic Tycoon Plans Stake Sale Talks for $8 Billion Gas Project

Tungesvik Takes Helm of Statoil Canada

Tullow Enters Greenland farm-in with Maersk

Seadrill Launches New York Listing


Earl’s Pearl of the Day: "Strength doesn’t come from what you can do. It comes from overcoming the things you once thought you couldn’t.” — Rikki Rogers






October 12, 2012

EPA Approves More Flexible Rules for Plant Expansion

Federal environmental regulators have approved a Texas permitting regime that gives oil refineries, chemical plants and other large industrial facilities flexibility to expand as long as the changes do not harm local air quality.

The Environmental Protection Agency said Thursday the approval came after the state made changes to bring some pieces of the program into compliance with the federal Clean Air Act.

For more information, click here.

Today's Links

Subsea 7 Wins $300 Million North Sea Contract from BP

With a Dearth of Pipelines, U.S. Oil Exports Rising

Rise of Chinese Shipyards in the FPSO Industry

Woodside Extends Prosafe Rig Deal


Earl’s Pearl of the Day: "There are no secrets to success. It is the result of preparation, hard work and learning from failure.”— Colin Powell




October 11, 2012

Shell Opening New Arctic Frontier

Despite repeated setbacks, many members on the 124-person team boring an exploratory well for Shell are convinced the company will strike oil here, opening a new frontier in U.S. oil development and making a discovery that could rival the bounty in the deepwater Gulf of Mexico.

"The potential is huge, and everyone on board knows it,” said Craig Amos, a Halliburton employee who helps track pressure and other data poring from Shell’s Burger Well A.

"They say it’s bigger than Texas,” he added.

The enthusiasm was palpable early last month, when Shell began boring its first well in the Chukchi Sea, more than two decades after the last round of exploration in the region.

Shell estimates that about half the time it will take to drill its Arctic wells to their target depth is consumed by the initial drilling and site preparation it is now performing in the Chukchi and Beaufort seas. That initial prep work includes excavating a cellar in the sea bed to hold emergency equipment and keep it out of the way of floating ice as well as drilling and cementing casing in the first 1,400 feet of the Arctic wells.

For more information, click here.

Today's Links

 

Pay Skyrockets at Oil and Gas Firms

Houston Firm Drilling Exploratory Well in New York Shale

Lundin Makes Oil Discovery at Albert Prospect

Musings: Is America Knocking on the Door of Energy Independence?


Earl’s Pearl of the Day: "Weakness of attitude becomes weakness of character.” — Albert Einstein


 









October 10, 2012

Shale Gas Bonanza Could Extend to Other Industries

The shale gas boom could cut costs significantly for the chemical industry and ultimately benefit the apparel, electronics, machinery and other industries, according to a report released Tuesday.

The report by PricewaterhouseCoopers suggests cheap natural gas liquids could even prompt some companies to move production back to the United States.

It already has spurred an estimated $15 billion in new investments in Texas chemical plants, according to Hector Rivera, president and CEO of the Texas Chemical Council and Association of Chemical Industry of Texas.

Rivera said the rebound started as the nation began to recover from the recession.

For more information, click here.

Today's Links

Natural Gas Could Be Cheaper, Cleaner Way to Run a Railroad

OPEC Raises Demand for Forecast for Its Crude

GE Launches All-In-One Natural Gas Fueling Pumps

New Gas Field Discovered in Red Sea


Earl’s Pearl of the Day:"Even if you fall on your face, you’re still moving forward.” — Victor Kiam








October 9, 2012

$2.5 Billion Sale Makes Marathon fourth Largest Domestic Refiner

The planned sale of BP’s Texas City, Texas, refinery to Marathon Petroleum reinforces Marathon’s entrance as a major player in the U.S. refining sector and helps BP focus its strategy.

The $2.5 billion deal for one of the nation’s largest and most complex refineries, announced Monday, will make Marathon the fourth-largest domestic refiner.

"This is a unique opportunity to acquire world-scale refining assets at an attractive price,” said Marathon Petroleum CEO Gary Hemminger during a conference call with analysts Monday morning. "These refining and related assets strategically complement our existing business and provide the immediate scale for us to expand our Marathon brand business even further in the Southeast.”

Marathon Petroleum, based in Findlay, Ohio, spun off last year from Houston-based Marathon Oil, now an independent oil and gas company.

For more information, click here.

Today's Links

Oil Prices Rebound on Jitters About Supplies

FPSO Industry Finds Growth in Deep Waters

IEA Optimistic About Future of Iraq Oil Industry

Cooper Energy Announces Oil Discovery at Windmill-1


Earl’s Pearl of the Day: "You never achieve success unless you like what you are doing.” — Dale Carnegie







October 8, 2012

TPC Group Draws Higher Offer

TPC Group said it received an all-cash offer for $44 to $46 a share from rival Innospec in a deal financed by the private equity firm Blackstone. The deal, which could be worth as much as $721 million at those prices, tops an earlier $628 million offer TPC had accepted from First Reserve Corp. of Greenwich, Conn., and New York-based SK Capital Partners.

After reviewing Innospec’s offer, TPC’s board determined it could lead to a bid that’s superior to the $40 per share deal it accepted in August, the company said in a statement.

First Reserve and SK Capital previously declined to comment on whether they would increase their bid. Now, if they want to stay in the running, the next move is up to them.

For more information, click here.

Today's Links

Total Swaps North Sea Assets with Exxon

Do We Need Subsidies for Solar and Wind Power?

A Tale of One Shale Helped Guide Another

Apache Awards Subsea 7 Julimar Contract


Earl’s Pearl of the Day: "You will never change your life until you change something you do daily.” — Mike Murdoch







October 5, 2012

Calpine Buys Texas Power Plant for $432 Million

Calpine said it will buy a natural gas-fired power plant in Texas for about $432 million to boost its presence in a state where the supply of surplus power is shrinking.

Calpine is buying the 800-megawatt plant near Laguna Park in central Texas from Bosque Power. Calpine said it will use cash on hand for the deal, which it expects to close in early November.

It said the price will also include unspecified adjustments but did not provide an estimate of how that would affect the closing price.

For more information, click here.

Today's Links

Eagle Ford Could Keep Pump for Another 16 Years

Crude Rallies Sharply as Gasoline Surges

 

Debate: Candidates Recognize Need for National Energy Policy

Singapore’s Sembcorp Marine Inks Letter of Intent to Build Rig for Prosafe


Earl’s Pearl of the Day: "To give anything less than your best is to sacrifice the gift.” — Steve Prefontaine









October 4, 2012

Gulf of Mexico Poised for Resurgence in 2013

The Gulf of Mexico is set to top peak production by 2019 after high levels of investment and successful projects have spurred a resurgence, according to the energy consulting firm Wood Mackenzie.

The firm said the area is expected to top 2 million barrels of oil equivalent a day by 2019, and the region is currently being defined by large investments, wide range of opportunities and large number of explorers.

Production is now around 1.4 million barrels of oil a day.

Offshore drilling, particularly in the Gulf of Mexico, has become a sticking point between the energy industry and the government. Industry officials claim a slow approval process by the government is causing production to suffer.

For more information, click here.

Today's Links

Gasoline Poised to Fall as Refineries Return

Stanislaw: De-Politicize Energy

BP Starts-Up Devenick Gas Project

Oil Gains as Syria-Turkey Tensions Rise


Earl’s Pearl of the Day: "Never let your head hang down. Never give up and sit down and grieve. Find another way.” — Satchel Paige









October 3, 2012

Biofuels Industry Lauds Automakers for Approving Higher Ethanol Fuel Blend

Ford and General Motors have approved use of a higher concentration of ethanol fuel in new vehicles — a significant victory for the biofuels industry.

New GM and Ford vehicles will accept a fuel blend that’s 15-percent ethanol, as opposed to the standard 10-percent blend. For GM, that will begin with 2012 models, while Ford will accommodate the fuel in 2013 models, according to "Oil Price Information Service,” which first reported the news.

The auto industry’s resistance to higher blends of ethanol — which it says are more corrosive to older engine models — has long been a roadblock in getting higher concentrations of ethanol fuel blends on the market.

Clearing that is important for the biofuels industry, which has said it needs the higher blend, known as E15, to meet a mandate that requires refiners to blend 36 billion gallons of biofuels into traditional transportation fuel by 2022.

For more information, click here.

Today's Links

Magnolia Petroleum Increases Participation in Oklahoma Wells

Oil Patch Start-ups Speed Date Investors

Deepwater Explorations to Dominate Australia’s LNG Market

Marathon Enters Ethiopia with Acquisition


Earl’s Pearl of the Day: "Change the changeable, accept the unchangeable and remove yourself from the unacceptable.” — Denis Waitley








October 2, 2012

Energy XXI Adds Assets in the Gulf

In an expansion of its shallow-water business, Energy XXI said Monday it will buy Gulf of Mexico assets from ExxonMobil and will enter a joint venture with the company to explore for oil and gas in an adjacent area of the Gulf.

The Houston-based independent, which was formed in 2005, also announced the completion of its first horizontal well in the Gulf.

Energy XXI did not disclose the purchase price for the Gulf assets but estimated its total commitment to the joint venture at $75 million, assuming successful completion of two earning wells.

Energy XXI will operate the joint venture and drill the initial prospect, which it expects to begin by the end of the year.

For more information, click here.

Today's Links

Nabors Tells SEC Fracking Isn’t Risk to Water Supplies

Crude Gets Small Boost from ISM Data

ExxonMobil to Drill Irish Atlantic Frontier Early Next Year

Shale Gas Joint Venture Formed in China


Earl’s Pearl of the Day: "A gem cannot be polished without friction, nor a man perfected without trials.” — Chinese Proverb









October 1, 2012

Shale Play is Engine of Growth for Rail

All across South Texas, rail yards are adding track to service the shale drilling boom happening in a 20-county swath of the state, stretching from the border toward East Texas.

Hondo Railway started as the South Texas Liquid Terminal in San Antonio in the late 1970s, specializing in transporting about 1,500 rail cars a year filled with high-fructose corn sweetener from the Midwest for soft drink bottlers throughout South Texas.

But about six years ago, the company lost its lease on Union Pacific land where it had been operating and had to quickly find another spot or shut down. It found acreage — the cotton field — at Hondo’s
South Texas Regional Airport, about 30 miles west of San Antonio off U.S. 90.

South Texas Liquid Terminal made the move and opened a new entity, Hondo Railway, with 13,000 feet of track and hopes of diversifying beyond corn sweetener. Now it has 80,000 feet of track and moves fracturing sand, crude oil, ethanol, cornstarch and everything from lumber to power plant parts.

For more information, click here.

Today's Links

Transocean Ban on Renting Rigs to Petrobras in Brazil Eased

Gas Futures Jump 6.3 Percent

Aker Wins Extension to Troll Contract

Iraqi Crude Oil Production Reached Highest Level in Decades


Earl’s Pearl of the Day: "Courage is resistance to fear, mastery of fear, not absence of fear.” — Mark Twain






September 28, 2012

Transocean Announces 10 Year Contracts for Four New Ultra-Deepwater Drillships

Transocean said Friday that it was awarded 10-year contracts for four new drillships by oil giant Royal Dutch Shell, which will bring about $7.6 billion in revenue.

The contracts are expected to start in 2015 and 2016 after the drillships, designed to operate in ultra-deep water, are built. The construction of the vessels will add $3 billion to Transocean’s capital budget, the company said.

For more information, click here.

Today's Links

BP Products Agrees to Pay $210,000 for Oil Spill Response Violation

Natural Gas Wins Place as Oil Field Fuel

Providence to Focus on Ireland after UK Asset Sale

New Zealand Oil and Gas Confirms Commitment to Drill


Earl’s Pearl of the Day: "You may have to fight a battle more than once to win it.” — Margaret Thatcher






September 26, 2012
U.S. Interior Department Schedules Sale of Alaska Drilling Leases

The Obama Administration has announced it will offer oil drilling leases on nearly 4.5 million acres in Alaska’s National Petroleum Reserve during an auction scheduled for November.

The auction, which will allow energy companies to bid for exploration rights on selected tracts in the 23-million-acre reserve, is part of President Barack Obama’s 2011 pledge to hold annual lease sales in the government-owned swath of land on Alaska’s North Slope.

The administration also said it will hold a separate auction in March for leases on about 38 million acres in the central Gulf of Mexico.

"The energy resources of the National Petroleum Reserve in Alaska are essential to meeting our nation’s energy demands and will enhance domestic energy production and decrease dependency on foreign oil sources,” Interior Secretary Ken Salazar said in a statement.

The lease sale in the Alaska reserve is scheduled to take place Nov. 7.

Click here for more information.



Today's Links


Westlake Chemical to Start-Up Ethylene Expansion at Lake Charles

Shale Means U.S. No Longer an Energy ‘Couch Potato’

Energy, Unemployment and The Health of the U.S. Economy

Could Scotch Whiskey Leftovers Power Cars?



Earl’s Pearl of the Day:"We would accomplish many more things if we did not think of them as impossible.” — Vince Lombardi




September 24, 2012

Quicksilver Agrees to Joint Venture with Shell Unit in Colorado

Quicksilver Resources Inc. said Monday it agreed to a joint venture with a unit of Royal Dutch Shell in Colorado’s Sand Wash Basin.

According to the agreement, Shell unit SWEPI LP and Quicksilver will each own 50 percent of 330,000 acres in the emerging oil and gas play. Quicksilver will receive an undisclosed payment for the acreage it contributes to the joint venture in excess of Shell’s own contribution.

The move comes as international oil giants deepen their involvement in North American onshore oil fields, which have been revitalized by hydraulic fracturing techniques. Shell earlier this month bought acreage in West Texas from Chesapeake Energy Corp., and Exxon Mobil Corp., the world's largest publicly traded oil company, last week agreed to purchase land in North Dakota’s Bakken Shale from Denbury Resources Inc.

For more information, click here.

Today's Links

Auto Industry Revs Up for Race to Meet Fuel Standards

Simple Math to Put "Energy Independence” Into Perspective

Indian Consortium Bids for ConocoPhillips Assets in Canada

Norway Takes New Approach to Naming Offshore Fields


Earl’s Pearl of the Day: "Wealth is the ability to fully experience life.” — Thoreau





September 19, 2012

Sunoco Hands Over Keys to Philly Refinery

Sunoco Inc. Chief Executive Brian P. MacDonald has handed over the ceremonial keys to the company’s Philadelphia oil refinery, saving 850 jobs and giving new life to the sprawling 146-year-old plant.

"Hopefully, the transaction will be as good as the publicity has been,” said William E. Conway Jr., co-chief executive of the Carlyle Group.

Carlyle will be responsible for operating the facility, the largest refinery on the East Coast. It says it is "reimagining” the plant as a regional energy hub that will rely upon growing production of Marcellus Shale natural gas to manufacture motor fuels, electricity and chemicals.

"We’re not rescuing anything,” said Philip L. Rinaldi, the chief executive of the new venture called Philadelphia Energy Solutions. "We’re coming in here to build industries.”

The refinery’s transfer to Carlyle marks the end of more than a century of fuel manufacturing for Sunoco, which began refining in 1894 with the acquisition of a plant in Toledo, Ohio.

The deal involved a remarkable degree of cooperation among Sunoco, Carlyle, labor and political leaders, including officials in the White House. Gov. Corbett, a Republican, and U.S. Rep. Bob Brady, a Democrat, heaped praise on each other Wednesday. Leo W. Gerard, the international president of the United Steelworkers, extolled the union’s cordial relationship with Carlyle executives.

Click here for more information.


Today's Links

Shell Leads LNG Competitors Out to Sea With Biggest Ship

After Spill, Gulf Oil Drilling Rebounds


World Seeks U.S. Know-How on Shale

UK Lawmakers Call for Arctic Exploration Moratorium


Earl’s Pearl of the Day:
"Advice is like snow - the softer it falls, the longer it dwells upon, and the deeper it sinks into the mind.” — Samuel Taylor Coleridge




September 19, 2012

BP Reportedly in Talks to Sell Texas City Refinery to Marathon Petroleum

British Petroleum (BP) may be selling its Texas City, Texas, refinery for nearly $2.5 billion, according to the "Houston Business Journal.”

The report says BP and Ohio-based Marathon Petroleum have been in serious negotiations about the property for months, but that a deal is not definite. Though analysts anticipate a deal getting done before the end of the year.

BP has sold off billions in assets recently, including its Southern California refinery last month.

For more information, click here.

Today's Links

Shell Expects to Meet Iraq Oil Field Target Despite Setbacks

Phillips 66 CEO Says Exports Will Ease U.S. Refining Challenges

Osage Begins Drilling Oklahoma Well

Offshore Morocco: Drilling Deeper


Earl’s Pearl of the Day: "Nothing changes if nothing changes. And if I keep doing what I’ve always done, I’ll keep getting what I’ve always got, and I’ll keep feeling what I’ve always felt.” — Earnie Larsen







September 18, 2012

Shell Delays Quest to Strike Arctic Oil

Royal Dutch Shell said Monday it would push back to next year its plans to find oil in Alaska’s Arctic offshore after a key oil containment system was damaged during a test.

The delay is a major setback for the Anglo-Dutch oil giant, which has spent six years and $4.5 billion in a bid to open up one of the world’s last great oil frontiers, which geologists say contains vast amounts of oil and gas.

Shell’s effort had been hampered by delays due to regulatory issues, mishaps and persistent sea ice, but it had expected to drill wells to depths where they might strike oil before harsh weather set in between late September and late October. Now, it will have to focus solely on drilling the initial stages of the exploration wells, known as "top holes,” reaching a limited depth. Shell said it would concentrate on drilling as many of these as possible before winter ice takes hold.

Marvin Odum, the head of Shell’s exploration and production operations in the Americas, said "it’s a disappointment that we won’t be drilling into hydrocarbons this year.” He added, however, the company has been successful at building the basis of a multiyear exploration program and expectations for its outcome haven’t changed.

Shell was expecting to receive a permit from U.S. authorities to drill wells all the way to oil-bearing depths once its Arctic Containment System, a newly designed set of safety equipment designed to contain oil spills, was successfully tested. But during a final test, a containment dome, designed to be put on top of a leaking well, was damaged, it said. "It is clear that some days will be required to repair and fully assess dome readiness,” Shell said in a statement. "We are disappointed that the dome has not yet met our stringent acceptance standards.”

Mr. Odum said Shell would seek to make sure the containment system works as soon as possible, even if it isn’t intended for use this year.

Click here for more information.

Today's Links

Oil Makes Its Rail Connection

Petroleum Companies Appeal Federal Leasing

EPA Raises Biofuels Targets for 2013

S. Dakota Mining School’s New Grads Beat Harvard’s for Pay


Earl’s Pearl of the Day: "One can never consent to creep when one feels an impulse to soar.” — Helen Keller


September 17, 2012

EPL to Buy Gulf of Mexico Properties from Hilcorp

EPL Oil & Gas agreed to buy certain shallow-water Gulf of Mexico properties from Hilcorp Energy for $550 million.

The properties include three fields that are on the Central Gulf of Mexico shelf in the vicinity of EPL’s existing core field areas. The shelf oil and natural gas interests are currently producing about 10,000 barrels of oil equivalent per day, about 50 percent of which are oil.

EPL has submitted a 10-percent cash deposit and expects to close the deal by Oct. 31.

For more information, click here.

Today's Links

Exxon Valdez Could Affect BP Settlement

Bacteria Removed At Least 200,000 Tons of Oil and Gas Following Macondo

Subsea Equipment Providers See Boom Ahead

Federal Stimulus Sends Crude to Four-Month High


Earl’s Pearl of the Day: "The first requisite of success is the ability to apply your physical and mental energies to one problem without growing weary.” — Thomas Edison







September 14, 2012

Making Sense of the U.S. Oil Boom

Due to hydraulic fracturing and deepwater technology, the United States is now pumping oil in larger quantities than it has in more than a decade, and its growing status as a crude producer is taking the world by storm.

In a conversation with "The Wall Street Journal,” Daniel Yergin, the energy industry’s most prominent chronicler, talks about the American oil renaissance and its profound implications for the United States in a changing world. Yergin, currently vice chairman of IHS, a consulting firm in Englewood, Colo., is the author of "The Quest: Energy, Security, and the Remaking of the Modern World.” His history of the oil industry, "The Prize,” earned a Pulitzer Prize.

To see the transcript of Yergin’s Q&A with "The Wall Street Journal,” click here.

Today's Links

Gas Prices, Cars Push Retail Sales Up 0.9 Percent

North American Energy Independence Hinges on Right Government Policies

Total to Drill First Ugandan Exploration Oil Well by Year’s End

Petrobas Gains Pre-salt Approval


Earl’s Pearl of the Day: "Always look at what you have left. Never look at what you have lost.” — Robert Schuller






September 12, 2012

Two States Say Spill Deal is Inadequate

A proposed settlement of claims relating to the 2010 Gulf of Mexico oil spill is insufficient for spill victims in Louisiana and Mississippi, the states have told a federal judge overseeing the deal.

The two states aren't party to the proposed settlement between BP and a committee representing plaintiffs, and they aren't asking U.S. District Judge Carl Barbier to throw it out.

The settlement does not address civil and possible criminal complaints by federal, state and local governments.

Mississippi Attorney General Jim Hood focused on provisions of the settlement that carve the region into zones, each with different paperwork requirements and different formulas for amounts claimants can receive.

In one zone, for example, the settlement stipulates claimants who can prove damages need not prove the oil spill caused them, Hood said. In another zone, business claimants must show their profits were lower in the year of the spill than afterward.

For more information, click here.

Today's Links

 

Onshore U.S. Exploration Creating Future Opportunities for Upstream MLPs

Chesapeake Energy Selling Some Assets for $6.9 Billion

Nations Meet to Keep Caribbean Clean Amid Oil Quest

Petrobas Starts Output at Baleia Azul Presalt Field


Earl’s Pearl of the Day: "Only those who risk going too far can possibly find out how far one can go.” — T.S. Eliot


 







September 11, 2012

Shell Interrupts Drilling in Alaska Arctic to Avoid Ice

One day after starting to drill the first well in Alaska’s Arctic offshore in more than two decades, Royal Dutch Shell said Monday it needed to move its rig as a precaution against sea ice that could move into the area.

Shell said it decided to temporarily move off the Burger-A well after the wind shifted, in order to avoid a chunk of ice it has been monitoring.

"Part of working in ice is having the ability to temporarily relocate,” spokesman Kelly op de Weegh said.

The Noble Discoverer, one of the two drillships Shell leased for the Alaska drilling campaign, began digging the "top hole” of the prospect on Sunday.

Shell said the ship is disconnecting from its anchors and will come back to the area and resume drilling the initial phases of an exploratory well when the ice moves on.

The company plans to do work in up to five Arctic wells this season — three in the Chukchi Sea and two in the Beaufort Sea.

Click here for more information.

Today's Links

Gulf Coast Refiners, Petchem Plants Apply Hard-Won Preparedness Lessons

Spectra Plans Export Network for Natural Gas in Canada

Crude Edges Higher as Traders Look to Fed

Diplomat: U.S. Ready to Help Implement Trans-Caspian Pipeline Project



Earl’s Pearl of the Day: "A discovery is said to be an accident meeting a prepared mind.” — Albert Szent-Gyorgyi




September 10, 2012

BP Agrees to $5.55 Billion Deal with Plains for Gulf Assets

BP announced this morning plans to sell a number of assets in the Gulf of Mexico to Plains Exploration and Production Co. for $5.55 billion in cash as part of a plan to divest its assets.

The deal includes a number of natural gas and oil fields in the Gulf of Mexico, including two non-operating assets — Ram Powell and Diana Hoover. The deal also includes three operating assets — Horn Mountain, Holstein and the Marlin Hub, which is comprised of Marlin, Dorado and King fields.

BP has sold more than $32 billion in assets since 2010 as part of a plan to divest its assets to focus on areas of growth, the company said.

The deal with Plains doesn’t signal an end to BP’s presence in the Gulf though, Brett Clanton, a BP spokesman, told Bloomberg.

"No one should confuse our effort to sell these older, non-strategic assets, which we announced months ago, with our ongoing commitment to the Gulf of Mexico,” Clanton said.

For more information, click here.

Today's Links

Finding Common Ground in the Gulf

Transocean in Talks for Four New Deepwater Rigs

Drillers See Robust Demand for Ultra Deepwater Rigs

Apache’s Kenyan Well Hits Gas


 

Earl’s Pearl of the Day: "When you play, play hard; when you work, don’t play at all.” — Theodore Roosevelt






September 7, 2012

Bingaman Exit Could Help Gulf States Get More Offshore Drilling Royalties

The retirement of Senate Committee on Energy and Natural Resources Chairman Jeff Bingaman (D-N.M.) makes getting a bill to increase federal offshore drilling payments to coastal states more likely next Congress, staff for Sen. Mary Landrieu (D-La.) told The Hill on Thursday.

Landrieu said in a letter, hand delivered Monday to President Obama, the flooding caused by Hurricane Isaac calls for another debate on revenue payments to coastal states. The letter signaled the Louisiana Democrat would push a bill to alter the payment structure and schedule next Congress after coming up short last year.

The four states Landrieu seeks to aid — Alabama, Louisiana, Mississippi and Texas — are scheduled to get 37.5 percent of federal revenues from energy production in the Gulf of Mexico beginning in 2017.

Landrieu’s proposal would lift the $500 million cap on those royalties and start paying the states in 2015. It also would create a revenue-sharing mechanism for states engaging in future federal offshore renewable energy production.

Staff admitted the renewable energy portion of the bill was scraped together at the last second to sway some Democrats. Staff said those Democrats hinted they liked the idea but ultimately decided the language needed more work.

For more information, click here.

Today's Links

Oil Firms Show Record Interest in Mature Areas Offshore Norway

Saudi Aramco, Total Refinery on Schedule

Delta Looking to Transport Bakken Crude by Rail

South Africa Lifts Ban on Shale Gas Exploration in Karoo Region


Earl’s Pearl of the Day: "We are what we repeatedly do. Excellence, then, is not an act, but a habit.” — Aristotle












September 5, 2012
BREAKING NEWS:

Department of Justice Accuses BP of Gross Negligence in Gulf Oil Spill

The U.S. Department of Justice has accused BP Plc (NYSE: BP) of gross negligence in the 2010 Gulf of Mexico oil spill, according to media reports.

For more information, click here.



Midstream Trio Plans Utica Shale Pipeline Project

Three big energy midstream players are teaming up to get a head start on what they believe will be a growing demand for natural gas transportation as the Utica shale develops in the Northeast.

Spectra Energy Corp., Enbridge and DTE Energy Corp. have completed a memo of understanding to develop the Nexus Gas Transmission system to move natural gas from the Ohio Utica shale to markets in the Midwest and Canada, Houston-based Spectra said Tuesday.

The system would include new pipeline through northeastern Ohio and parts of Michigan at a cost of $1.2 billion to $1.5 billion, said Brian McKerlie, vice president of business development for Spectra.

The new system would service local distribution companies, power generators and industrial users throughout Ohio, Michigan and Ontario. It would include 250 miles of new large-diameter pipe with the capacity to transport 1 billion cubic feet per day of natural gas.

Low natural gas prices have prompted operators to shift toward shales rich in more lucrative natural gas liquids and oil, and to view dry natural gas as a byproduct of that production. But McKerlie said the natural gas market in Michigan and Canada is robust enough to support the proposed infrastructure investment.

For more information, click here.

Today's Links

PDVSA Refinery Resumes Ops; Safety Questions Linger

ERCOT Says Grid is Ready for Fall and Winter

Key Designer of Fuel Mileage Standards to Leave EPA

Oil Exploration Giants Should Take Cue From NASA’s Mission to Mars


Earl’s Pearl of the Day:"Pleasure in the job puts perfection in the work.” — Aristotle



September 4, 2012

EPA to Grant Shell Request for Alaska Air-Quality Permit Changes

U.S. regulators granted a request from Royal Dutch Shell to alter the terms of an air pollution permit for the company’s Alaska drilling activities, removing a potential headache for the company as it proceeds to drill in the Arctic Ocean for the first time in decades.

The EPA said it would issue an order setting new air pollution limits for Shell’s activities, which include running diesel engines on its drill ship in the Chukchi Sea. Without the order, Shell would have faced fines for violations of clean air rules and negative headlines around its closely watched efforts in Alaska.

In June, Shell told the agency emissions from the engines exceeded the limits established in the original permit and asked for the permit to be changed to levels that are "achievable.”

A Shell spokesman said Friday the EPA’s decision was "more good news” one day after the company received a permit from the Interior Department to start drilling to a depth of about 1,400 feet below the floor of the Chukchi. That work could be underway within days, although the company still may not have enough time to complete the well by a Sept. 24 deadline set by U.S. regulators.

Click here for more information.


Today's Links

Statoil Delays Start of Chukchi Drilling Until at Least 2015

Valero to Convert Aruba Refinery to Terminal

Mexico Turns to Texas for Relief During Natural Gas Crisis

Saudi Arabia May Become Oil Importer by 2030



Earl’s Pearl of the Day:"Never explain — your friends do not need it and your enemies will not believe you anyway.” — Elbert Hubbard



August 31, 2012

Energy Firms in Gulf Re-staff Platforms, Refineries

United States Gulf Coast oil and gas companies on Thursday assessed damage from Hurricane Isaac and began to re-staff evacuated refineries and offshore platforms as the now-weakened storm winds its way through central Louisiana.

Analysts with Tudor, Pickering, Holt & Co. said energy markets aren’t expecting "lasting disruptions” but they are "looking for confirmation of this” from oil and gas companies.

So far, the markets are being mostly reassured. Valero Energy Corp. said Thursday two of its Louisiana refineries that were shut down in anticipation of the storm have sustained no major damage and are starting to be re-staffed. The refineries, in Meraux and Norco, had been shut down early in the week.

As of Wednesday afternoon, refiners had shut down about 936,500 barrels a day of refining capacity, or 5.4 percent of the nation’s total, according to a tally by the U.S. Department of Energy.

 

On Thursday, about 1.3 million barrels a day of oil, or 95 percent of the crude oil production in the Gulf of Mexico’s federal waters, remained offline, according to the U.S. Bureau of Safety and Environmental Enforcement (BSEE). So did 3.3 billion cubic feet a day of natural gas, or 73 percent of the region’s natural gas output. The shut-in production figures showed little change from the numbers released on Wednesday by BSEE.

 

The Department of Energy (DOE) said Thursday about 39 percent of Louisiana electric customers were without power. About 11 percent of electric customers in Mississippi had also lost power, the DOE said.

 

For more information, click here.

Today's Links

BP Will Donate $1 Million for Isaac Relief

Shell Wins Conditional OK to Drill in Arctic

Apache Deploying Wireless Seismic Technology in Alaska’s Cook Inlet

Crude Prices Higher, Investors Await Fed Speech


Earl’s Pearl of the Day: "It is not enough to aim; you must hit.” — Italian Proverb







August 28, 2012

Gulf Coast Refiners Shut Facilities as Isaac Looms

With the prospect of Tropical Storm Isaac turning into a hurricane and making landfall in the midst of one of the busiest refining hubs in the United States, refining companies began closing their Gulf Coast facilities, shutting down at least 8 percent of the country's total fuel production capacity.

The storm has caused energy companies to pull workers from more than half of the nearly 600 production platforms dotting the Gulf, shutting in about 78 percent of the region's oil production and nearly half of its natural gas production. In total, some 1.08 million barrels of oil a day and 2.2 billion cubic feet a day of natural gas are off-line in the region.

The storm-induced refinery closures have already shut down 1.3 million barrels a day of fuel production capacity, or 8 percent of total output, according to the Department of Energy.

The National Hurricane Center's hurricane warning extends along the coastline of the eastern half of Louisiana, all of the coastlines of Mississippi and Alabama, and parts of western Florida.

Isaac's approach caused Marathon Petroleum Corp. and Phillips 66 to start shutting two Louisiana refineries with a combined capacity of 711,000 barrels a day Monday, with other refiners expected to follow suit as the hurricane nears.

Valero Energy Corp. said it was shutting down its 270,000-barrel-a-day refinery in Norco, La., and its 135,000-barrel-a-day refinery in Meraux, La., "as a precautionary measure."

For more information click here

Today's Links

Chevron Cash Fuels Deal Talk

Venezuelan Govt: Oil Supplies Not Affected by Refinery Accident

TPC Group Would Go Private with Sale

Havyard Scoops PSV Order



Earl’s Pearl of the Day: "Let no man pull you low enough to hate him.” — Martin Luther King Jr.



August 27, 2012

Isaac’s Advance Roils Oil, Gasoline Market

Prices for crude oil and gasoline rose today as the advance of Tropical Storm Isaac caused companies to shutter offshore production in the Gulf of Mexico and threatened Gulf Coast refineries.

Crude futures for October delivery on the New York Mercantile Exchange rose $1.03 a barrel to $97.18, the biggest increase in a week. Forecasters are predicting Isaac will pick up strength, becoming a hurricane and making landfall early Wednesday between New Orleans and the Florida Panhandle.

About 24 percent of U.S. oil production and more than 8 percent of natural gas production has been affected by the storm, as oil companies pulled crews from 39 rigs, according to the Bureau of Safety and Environmental Enforcement. The affected facilities account for about 6.5 percent of the 596 manned platforms operating in the Gulf, BSSE said.

As Isaac continues to churn its way toward the coast, it’s likely to be a volatile week in the energy markets.

Click here for more information
.

Today's Links

Shell Asks for Arctic Drilling Extension

Kinder Morgan Energy Will Invest $90 Million in Project

BP’s Pockets are Jingling as Assets Sold

PetroChina Seeks Acquisitions in Central Asia, East Africa, Australia, Canada



Earl’s Pearl of the Day:"The roots of true achievement lie in the will to become the best that you can become.” — Harold Taylor



August 23, 2012

GOP Lawmaker Calls on White House to Push Natural Gas Exports

Rep. James Lankford (R-Okla.) put more pressure on the Obama Administration to expedite approvals for liquefied natural gas (LNG) export facilities, calling it a "lay-up” for job creation.

Lankford said on CNBC’s "Squawk on the Street” LNG exports would offer economic "predictability” by providing a place to park "billions of dollars of investment.”

"Jobs are sitting around ready to go in natural gas,” Lankford said. "All we lack is federal predictability.”

Earlier this month, Lankford joined 33 other Republicans and 10 Democrats from Arkansas, Louisiana, Oklahoma and Texas in a letter urging Energy Secretary Steven Chu to fast-track LNG export facility certifications. Lankford said Chu had not yet responded.

With international natural gas prices fetching three times the cost than it does in the United States, the lawmakers contend the nation could capitalize by exporting the energy source.

U.S. firms are jumping at the chance to take advantage of overseas markets, with the domestic one already flooded with cheap natural gas. ExxonMobil, which had in the past abandoned plans to export LNG, last week filed a joint proposal with Qatar Petroleum International to convert a Houston-area LNG facility into one that exports.

The Energy Department and the Federal Energy Regulatory Commission must rule on that project, which could bring in up to $10 billion of investment.

Click here for more information.

Today's Links

Gulf of Mexico Well Costs Up 10 percent, ConocoPhillips Exec Says

SEC Approves O&G Payment Disclosure Amendment

U.S. Oil Imports Seen Hitting 20-Year Low 42% of Use

Sinkhole Drillers Halt to Insert Pipe Casing



Earl’s Pearl of the Day:"More often than not, a hero’s most epic battle is the one you never see; it’s the battle that goes on within him or herself.” — Kevin Smith



August 22, 2012

Rosneft Breaks Seismic Ice in Arctic

Russian state-owned Rosneft has kicked off extensive seismic survey work a year ahead of schedule on a pair of Kara Sea blocks under its exploration pact with U.S. giant ExxonMobil.

A 3-D seismic survey covering an area of 3,000 square kilometers in the East Prinovozemelsky 1 block and site investigation work is also being carried out to help determine the locations of the first wildcat wells.

Rosneft subsidiary RN Shelf Far East has also launched a 2-D shoot over 5,300 kilometers in the East Prinovozemelsky 2 block.

The two tracts are among three East Prinovozemelsky blocks in the Kara Sea included in a landmark $3.2 billion exploration joint-venture deal signed by Rosneft and ExxonMobil earlier this year that will also encompass acreage in the Black Sea, as well as exploitation of unconventional plays in North America.

Earlier this month, the pair opened a prequalification round for a tender to build an Arctic-class rig to carry out exploration and appraisal drilling in the frontier offshore play.

The tender is likely to attract harsh-environment rig players such as Norway’s Odfjell Drilling, which is eyeing "concrete” opportunities for contracts in the Russian sector.

RN Shelf has also started another 3-D seismic survey covering 1,200 square kilometers on the South Russky block in the Pechora Sea.

Work on all three surveys is due to run until October.

Click here for more information.



Today's Links

U.S. Appeals Court Vacates EPA Cross-State Pollution Rule

White House Worked With Buyout Firm to Save Plant

Official: Israel Holds Opportunity for U.S. Oil and Gas Firms

Strange Bedfellows Debate Exporting Natural Gas


Earl’s Pearl of the Day:"I hear and I forget. I see and I remember. I do and I understand.” — Confucius



August 21, 2012

Shell’s Drilling Rig Begins Two-Week Trek to Arctic Sea

Shell’s Kulluk drilling rig began a two-week journey to the Beaufort Sea north of Alaska on Monday, marking a major step forward in the company’s slow march toward a new era of oil exploration in the region.

The 29-year-old conical drilling rig is being towed from Dutch Harbor, Alaska, to Shell’s Sivilluq prospect, where the company hopes to drill at least one well before ice encroaches on the region this fall.

The departure of the Arctic-bound rig is a sign of Shell’s confidence the company soon will be able to launch drilling in the area, despite setbacks that have shortened its window for oil exploration. Shell executives say they now are aiming to complete two wells in the Chukchi and Beaufort seas this summer, down a previous goal of five.

"We expect to drill this year,” said Shell spokeswoman Kelly op de Weegh. "It’s disappointing to lose any days in such a small window, but we look forward to making the most of the time we have.”

The company has been waiting for ice to clear, federal drilling permits and for a critical oil spill response vessel to be ready before it can begin the work. That spill response barge, the Arctic Challenger, still awaits a Coast Guard certification and approval from federal drilling regulators.

Shell committed to regulators to have the Challenger containment barge at the ready during drilling in hydrocarbon-bearing zones as part of the company’s oil spill response plan for the region.

Op de Weegh said Shell isn’t backing down from that pledge. "We are committed to having the Arctic containment system in place before drilling through liquid hydrocarbon zones, and that commitment will not change,” op de Weegh said.

"We are nearing completion of this first-of-its-kind Arctic containment system, which houses response, containment and separation processes in one vessel. While it’s a fourth line of defense in the unlikely event of a loss of well control, it will not be deployed until it meets our high standards.”

Click here for more information.

Today's Links

B.C. Businessman Proposes $13B West Coast Refinery

U.S. Says Oil Firms Should Respect Baghdad Government

Fuel Industry Pushes to Keep High-Ethanol Blends Off the Market


Louisiana Sinkhole 40 Days, 40 Nights Salt Dome Drilling Begins


Earl’s Pearl of the Day:"Treat your friends as you do your pictures, and place them in their best light.” — Jennie Jerome Churchill



August 20, 2012

Obama Administration Revives Talks Over Emergency Oil Release

The Obama Administration is reviving talks over the possible release of U.S. emergency oil supplies as the price of crude oil tops $95 a barrel, an administration official said.

The talks are in early stages and a final decision appears far from imminent, the official said. But the rising price of crude, along with increases in gasoline, is raising fears that high fuel costs could damage an already sensitive economy.

The average price of gasoline has reached $3.70, up from $3.40 a month ago, according to the "AAA Fuel Gauge.” The price of oil, meanwhile, settled at $95.60 a barrel Thursday, reaching a new three-month high.

A White House spokesman declined to comment on the issue.

The Strategic Petroleum Reserve is a 700-million-barrel stockpile of oil to be used in case of supply disruptions. The Obama Administration last released oil reserves in 2011 as part of a coordinated effort to offset drops in oil production in war-torn Libya.

The administration is also reaching out to ally countries to discuss the possibility of a coordinated release of emergency oil supplies, the official said.

The White House last considered a release of strategic reserves last spring, when oil prices were trading near $110 a barrel. The idea was shelved when oil prices fell.

Click here for more information.


Today's Links

Shell Races the Ice in Alaska


Opinion: Developing Arctic Resources Will Put Americans to Work

Mexico Pipeline Expansion May Bring More Money to Texas


Tallgrass Energy Partners to Acquire Significant Midstream Assets from Kinder Morgan Energy Partners


Earl’s Pearl of the Day:"We cannot fail to win unless we fail to try.” — Tom Clancy



August 17, 2012

Long Arm of Offshore Law Extends to Contractors

Federal regulators reaffirmed a year-old plan to go beyond policing oil companies and punish service companies, rig suppliers and other contractors that run afoul of rules governing offshore drilling.

The Interior Department’s Bureau of Safety and Environmental Enforcement (BSEE) used a policy document to lay out its approach to issuing what it calls "incidents of noncompliance” against contractors that violate offshore regulation. Those notices are the first step in a process that can lead to fines against companies.

"While the primary focus of BSEE’s enforcement actions will continue to be on lessees and operators, BSEE will, in appropriate circumstances, issue incidents of noncompliance to contractors for serious violations of BSEE regulations,” the document says.

The move solidifies a relatively new approach to offshore drilling oversight at the Interior Department, a year after drilling regulators first announced they would stop focusing solely on the lease owners and operators that search for oil and gas in federal waters.

In the policy document, the safety bureau says it will consider the gravity of a violation when considering whether a contractor should get a citation. Other factors include whether a contractor could reasonably predict its actions would result in serious injury or environmental damage.

The bureau also pledged to consider how much power a contractor has in taking actions that violate outer Continental Shelf regulations — a recognition that when it comes to offshore drilling, operating oil companies usually dictate the way things are done.

According to the policy guidance, the safety bureau will weigh whether a contractor had control over any activity that resulted in a violation and whether the firm should have known that the action would run afoul of regulations.

Click here for more information.

Today's Links

Offshore Drilling Boom Continues Unabated, Despite Economic Turmoil

CO2 Emissions in U.S. Drop to 20-year Low

Mexichem Plans Ethane Cracker JV with OxyChem

Sixel: ‘Next Level’ for Women in Energy


Earl’s Pearl of the Day:
"You better live your best and act your best and think your best today, for today is the sure preparation for tomorrow and all the other tomorrows that follow.” — Harriet Martineau


August 16, 2012

Shell’s Arctic Oil Drilling Window Closing as Permits Awaited

The short window for Royal Dutch Shell to drill exploratory wells off Alaska’s Arctic coast is rapidly narrowing as the company still hasn’t completed the retrofit of its vital oil spill response vessel or received final permits for its use.

Shell initially planned to begin exploration activities in the Chukchi and Beaufort Seas in July. However, the company said Wednesday it is still working with U.S. officials on a schedule for inspections and deployment of the converted barge, the Arctic Challenger, which needs to be in place before drilling can start.

"Progress related to the final construction of the Arctic Challenger containment barge remains steady. We continue to work closely with the U.S. Coast Guard to outline a schedule for final inspections and an on-water deployment that would lead to certification,” a Shell spokesman said.

There’s no set timeline for the completion of the process, the spokesman added.

Shell has to wrap up drilling for oil in the Chukchi Sea by Sept. 24 and in the Beaufort Sea by the end of October. The deadlines are designed to create a buffer of time during which Shell can respond to any potential oil spills before ice moves in.

Wells in that area can take from 25 to 40 days to drill, although it’s hard to give a precise time due to the complexities of drilling in such an environment, the Shell spokesman said.

Click here for more information.


Today's Links

Regulators Tweak Final Offshore Well Rules

Murkowski: Consider Asia for Alaska Natural

China’s Sinopec Pursues Big Energy Deal in Texas

EPA Likely to Approve Grain Sorghum for Cleaner Ethanol


Earl’s Pearl of the Day:
"I’d rather be a failure at something I love than a success at something I hate.” — George Burns


August 15, 2012

BP Said to Seek $7.9 Billion Selling Gulf of Mexico Fields

BP Plc is seeking as much as $7.9 billion before tax payments for a group of Gulf of Mexico oilfields as it unloads assets following its 2010 spill in the region, two people with knowledge of the matter said.

The oil producer, Europe’s biggest after Royal Dutch Shell Plc, has prepared preliminary information for prospective buyers of assets including the Horn Mountain, Holstein, Diana Hoover and Ram Powell fields, said the people, who asked not to be identified because the sale process is confidential.

Because of taxes payable by the eventual buyer, the maximum proceeds BP can expect from the fields will probably be $5 billion to $6 billion, one of the people said. The fields, which hold proven reserves of about 120 million barrels of oil, produced about 58,000 barrels a day in the first quarter, the person said.

Chief Executive Officer Bob Dudley plans to sell $38 billion of assets by the end of next year, shrinking BP after the accident at its Macondo well, the worst offshore spill in U.S. history, wiped out a third of its market value. The London-based company said in May it plans to sell some "nonstrategic” assets in the Gulf.

"We’re progressing the planned divestments [in the region] to really focus our Gulf of Mexico footprint,” Dudley said on a July 31 conference call.

BP does not comment on speculation about the value of assets it’s selling, Brett Clanton, a BP spokesman, said in an email.

"But no one should confuse our effort to sell these older, nonstrategic assets, which we announced months ago, with our ongoing commitment to the Gulf of Mexico,” he said. BP intends to continue investing at least $4 billion annually in the Gulf over the next decade, Clanton said in the email.

Click here for more information.


Today's Links

BP Scrapes Barrel with Latest Sale

USGS releases U.S. Oil, Gas Reserves Growth Estimates

Landrieu Presses Coast Guard on BP Spill Cleanup

Survey Says Voters Back Offshore Drilling



Earl’s Pearl of the Day:
"We all have a few failures under our belt. It’s what makes us ready for the successes.”Randy K. Milholland




August 14, 2012

Interior to Open More of National Petroleum Reserve for O&G Development

Secretary of the Interior Ken Salazar on Monday outlined a proposed plan to open additional acreage in the National Petroleum Reserve in Alaska (NPR-A) for oil and gas development. The proposed plan would make approximately 11.8 million acres available for leasing.

In March, the Interior released the draft Integrated Activity Plan and Environmental Impact Statement (IAP/EIS), which included four future management alternatives for the NPR-A.

The Interior Department decided to modify Alternative B of that plan after receiving more than 400,000 public comments on the IAP/EIS and feedback from a wide variety of stakeholders, including Alaska Native tribal governments, corporations and other Native organizations, local, state and government agencies, conservation groups and business and industry organizations.

The proposal to open more acreage in drilling comes on the heels of President Obama’s directive in May 2011 for annual oil and gas lease sales to be held in the NPR-A. The U.S. Bureau of Land Management last December offered 3 million acres in a lease sale, which resulted in 17 winning bids covering over 140,000 acres. Another lease sale is scheduled to be held in the NPR-A this November.

According to the Department of the Interior, the NPR-A is estimated to hold approximately 549 million barrels of discovered and undiscovered economically recoverable oil and approximately 8.7 trillion cubic feet of discovered and undiscovered economically recoverable natural gas.

The preferred alternative plan allows for the possibility of pipelines and related infrastructure to be constructed in the NPR-A to accommodate future oil and gas production in the Chukchi and Beaufort seas.

The final IAP/EIS is expected to be released late this year.

Click here for more information.


Today's Links

Hawaii Gas Seeks Liquefied Natural Gas Approval

West Texas Taking ‘Intelligent Approach’ to Oil Boom

U.S. Mill Re-Opens to Meet China’s Rising Demand for Diapers

Olympic Stadium’s Chemically Produced Wrap Getting Recycled


Earl’s Pearl of the Day:"Always be a little kinder than necessary.” — James M. Barrie


August 13, 2012

Feds Give New Guidelines for Offshore Spill Response Plans

Federal regulators have given offshore drilling operators the most specific instructions yet for how the companies should prove they are ready to respond to oil spills.

The guidance came in the form of a "notice to lessees” issued late last week by the Bureau of Safety and Environmental Enforcement (BSEE).

The 41-page document outlines standards for the oil spill response plans required of companies drilling on the nation’s outer continental shelf. The plans document exactly what resources companies have to respond to spills from their offshore operations.

The bureau is pushing companies to adopt "flexible and innovative offshore oil spill response techniques” — even if those approaches or equipment don’t already have a rating for the amount of oil they can recover on any given day.

For instance, while some long-standing oil removal equipment, including skimmers, has been rated for its daily recovery capacity, that isn’t the case with more cutting-edge technology.

"BSEE encourages you to use new technology and response systems that will increase the effectiveness of mechanical recovery tactics,” the bureau said, adding its review will consider "the complete response strategy” companies detail.

Current regulations require offshore operators to show plans to support oil spill responses for worst case scenarios where the spills last 30 days.

But in the new notice, the bureau made clear operators should go beyond that and describe how they would get supplies in case a spill continued gushing unchecked for even longer — as did the 2010 Gulf of Mexico spill that led to the creation of the bureau and the new response rules.

Click here for more information.


Today's Links

Alaska Governor Asks Salazar to Expedite Point Thomson Decision

Study: U.S. Natural Gas Market Has Grown 15% Since 2009

BP Sells Texan Midstream Assets

CNOOC to Submit Oil Deal for Review


Earl’s Pearl of the Day:
"It is better to know some of the questions than all of the answers.” — James Thurber


August 10, 2012

Cheniere Proceeding with LNG Export Facility

Cheniere Energy Partners LP is moving ahead with the construction of facilities to liquefy and export natural gas in Louisiana, moving the United States one step closer to becoming a major exporter of the commodity.

The company said Thursday it had given engineering contractor Bechtel Oil, Gas and Chemicals Inc. the green light to start building two liquefaction trains at its Sabine Pass, La., import terminal. The first liquefaction train, which will turn natural gas stemming from booming U.S. shale fields into liquid that can be exported overseas, is expected to start operating as early as 2015, and the second train will start six to nine months later.

Cheniere, which originally built the Sabine Pass facility to import natural gas at a time when experts perceived there would be shortages of the commodity, began its effort to turn it into an export terminal about two years ago. The company has struck long-term agreements with four global buyers to supply more than 2 billion cubic feet a day of natural gas for 20 years.

"It is a testament to the flexibility of the U.S. markets and institutions that a small company like ours was able to accomplish so much in a short time,” said Cheniere Chief Executive Charif Souki.

Cheniere expects the project to cost about $5.6 billion, funded by $2 billion of equity and $3.6 billion of debt. The effort is backed by private-equity firm Blackstone Group.

"We are pleased to provide the growth capital to fund the construction of the first LNG export facility in the continental United States, creating thousands of jobs for American workers and providing significant benefits to the U.S. economy,” David Foley, senior managing director of Blackstone, said.

Cheniere is the only company that has received approval from the Obama Administration to export LNG to countries lacking a free-trade agreement with the United States.

Click here for more information.

Today's Links

Suits Filed in Shaw Deal

Sinkhole Free of Radiation but Residents Still Mad

API: Obama Administration Should ‘Make Good’ on Energy Strategy

EIA Projects Slightly Higher Global Oil Demand Growth


Earl’s Pearl of the Day:
"The Chinese use two brush strokes to write the word ‘crisis.’ One brush stroke stands for danger; the other for opportunity. In a crisis, be aware of the danger —- but recognize the opportunity.” — John F. Kennedy


August 9, 2012

Allen Parish Agrees to Property Lease for Refinery

The Allen Parish, La., Police Jury has agreed to lease more of the former Arizona Chemical property in Oakdale to a Texas-based company for a $100 million refinery.

The company, Virtual Engineering Operations (VEOPS) of Kingwood, Texas, plans to build a refinery to process 20,000 barrels a day of crude to produce diesel fuel for farmers, jet fuel and heating oil.

The company hopes to increase its production to 40,000 barrels a day in the future with construction of a pipeline.

In April, the Police Jury granted a 49-year lease to the company for 67 acres of the property at a cost of $100 per acre for five years, then $1,000 per acre for the remainder of the lease. The panel on Monday agreed to lease 153 acres to the company.

VEOPS President J. Craig Harrington said the additional acreage is needed for a railroad track. The rail system is needed to unload products from 120 rail cars expected to arrive at the facility.

"We are also looking at the possibility of other companies coming in and using the track,” Harrington said. "We want to make the land available for more industrial development in the area.”

Harrington said plans for the refinery are on track and moving forward. The project is in the engineer design phase, he said. "We have to make sure everything is covered and put bids together,” Harrington said.

Construction on the facility is expected to begin in the next two to three months.

Click here for more information.

Today's Links

Chevron Removes Natural Gas from Louisiana Cavern after Sinkhole Found

Admiral Confident in Coast Guard Arctic Readiness

GOP Governors Decry Limited Role in Offshore Planning


China Accuses the U.S. of Interference in South China Sea Disputes


Earl’s Pearl of the Day:"It is no good to try to stop knowledge from going forward. Ignorance is never better than knowledge.” — Enrico Fermi


August 8, 2012

Lawmakers Urge Faster OK of LNG Exports

Nearly four dozen Republican and Democratic lawmakers from oil patch states implored the Obama Administration Tuesday to fast-track permits for export of liquefied natural gas.

The bipartisan push comes as a glut of domestic natural gas keeps prices low and has sent energy companies scrambling to find new markets for the fossil fuel.

In a letter to Energy Secretary Steven Chu, the lawmakers said exports are necessary to continue fostering development in Texas, Louisiana and other states that long have shipped gas via pipelines to other parts of the country that didn’t produce it themselves.

"Large portions of the country which were previously served by our region via pipeline now have a closer commodity at hand,” said the 44 lawmakers, led by Rep. Gene Green (D-Houston) and Rep. James Lankford (R-Okla.). "As such, without the ability to market to international customers, this could have a severe impact on production in our states.”

The lawmakers suggested the Energy Department is moving too slowly in vetting applications from at least seven companies to begin exporting liquefied natural gas, including a proposal from Texas’ Freeport LNG Development.

Federal regulators recently approved Houston-based Cheniere Energy’s plans to begin exporting LNG from its Sabine Pass terminal in southwest Louisiana, but the Energy Department has postponed verdicts on similar proposals until it gets the results of a study evaluating how selling more American harvested natural gas overseas would affect prices for U.S. consumers. The study is expected to be out this summer.

The administration is struggling to decide whether — and how much — the United States should share its new natural gas bounty with foreign countries. It already sells a relatively small amount of natural gas to Mexico, Canada, Brazil and other countries, but pending proposals could put the United States on track to export about 16 billion cubic feet daily.

"As part of the department’s statutory responsibility to determine whether natural gas exports are in the public interest, the Energy Department is assessing the economic impacts of increased natural gas exports,” spokeswoman Jen Stutsman said.

White House energy and climate change adviser Heather Zichal has said a major concern is ensuring if natural gas is exported, it won’t send prices too high inside U.S. borders — hurting American consumers and manufacturers who use natural gas as a building block to make other products.

In their letter, the oil patch lawmakers insist if U.S. regulators drag their feet, American producers could lose out to foreign competitors.

Click here for more information.


Today's Links

Shell: Oil Spill Barge Close to Beginning Arctic Journey

GPCA Official: Downstream Sector Must Act to Fill Widening Job Gap

Kuwait Going Ahead with $14.5B Refinery

Greek, Italian Governments Back Trans-Adriatic Gas Pipeline


Earl’s Pearl of the Day: "Only a fool would choose ignorance over learning or mediocrity over excellence.” — Earl B. Heard



August 7, 2012

Coast Guard Prepares for Expanded Arctic Role

The Coast Guard is ready for expanded activity in Arctic waters, including petroleum exploration, Commandant Robert Papp told a U.S. Senate subcommittee Monday, even though the nearest agency base is more than 750 miles southeast of the Bering Strait, on Kodiak Island.

"For right now, we are well prepared, because like we always do traditionally, we have multimission assets we can deploy that are very capable and are sufficient for the level of human activity going on this summer and perhaps for the next three or four summers,” Papp told a U.S. Senate Homeland Security Appropriations Subcommittee.

Sen. Mary Landrieu (D-La.) conducted the hearing in a hangar of Air Station Kodiak at the request of Sen. Lisa Murkowski (R-Alaska) with the intent of discussing Coast Guard needs as melting summer sea ice opens more of the Arctic to cargo vessels, ecotourism and possibly commercial fishing.

Landrieu asked whether the Coast Guard was prepared if something went terribly wrong with petroleum drilling, as happened in the Gulf of Mexico two years ago when the Deepwater Horizon drilling rig exploded.

Landrieu said the Gulf spill drew a response of 47,000 personnel and 7,000 vessels and she didn’t see those kinds of assets at the Kodiak base if Shell’s response measures were insufficient. "The Coast Guard is it,” she said.

In response, Papp said he had faith in Shell’s preparations."I have to say I’m impressed with the amount of effort, work and commitment of resources Shell has done,” he said.

The Deepwater Horizon rig was by itself, Papp said. Shell will have 22 spill response vessels and a containment apparatus staged near Arctic Ocean drilling sites.

"They will have everything in place, ready to go, an overabundance of caution in case something happens,” he said.

Papp said the comparison between the Gulf of Mexico and Shell’s proposed Alaska wells as a comparison of apples to oranges, to a certain extent. The Alaska wells will be drilled in water up to 150 feet deep, compared to 5,000 in the Gulf, and pressure in the petroleum reservoirs will be far less.

"But even saying that, we’re looking at the worst case discharge possibility and I think Shell has well prepared for that,” he said.

Click here for more information.

Today's Links

Murkowski, Hoeven Tour Alaska, Press for Expanded Drilling

Kinder Morgan Deals for Pipelines


U.S. Firm Gets Involved in Falklands Drilling

MSHA’s ‘Examinations’ Rule for Underground Coal Mines Effective Aug. 6


Earl’s Pearl of the Day:"Having a dream is what keeps you alive. Overcoming the challenges make life worth living.” — Mary Tyler Moore



August 6, 2012

Marcellus Shale Becoming Top U.S. Natural Gas Field

The Marcellus Shale is about to become the most productive natural gas field in the United States, according to new data from energy industry analysts and the federal government.

Though serious drilling only began five years ago, the sheer volume of Marcellus production suggests in some ways there’s no going back, even as New York debates whether to allow drilling in its portion of the shale, which also lies under large parts of Pennsylvania, West Virginia and Ohio.

The top spot for the Marcellus "doesn’t surprise me,” said Jay Apt, a professor of technology at Carnegie Mellon University. "But will it lead to industries that spring up to use that gas?” he asked, adding much of the bounty could also end up being shipped to Canada, the Gulf Coast or overseas.

In 2008, Marcellus production barely registered on national energy reports. In July, the combined output from Pennsylvania and West Virginia wells was about 7.4 billion cubic feet per day, according to Kyle Martinez, an analyst at Bentek Energy. That’s more than double the 3.6 billion cubic feet from last April, and represents more than 25 percent of national shale gas production.

That’s neck-and-neck with production from the Haynesville region in Arkansas and Texas, but new drilling permits there have declined sharply.

The Powell Shale Digest, an industry newsletter based in Fort Worth, Texas, concluded a recent report from the U.S. Energy Information Agency (EIA) means "it is reasonable to assume” the Marcellus has or will soon pass Haynesville as the top producer.

Apt said having a natural resource bounty is one thing, and using it wisely is another. The current wholesale price of natural gas is about $3 here, but $12 or more in Europe and Japan.

"It’s clear people will want to export” the Marcellus gas, Apt said, adding such an outcome could lead to what economists call "the resource curse,” which is when the general population hardly benefits, while a few get very rich.

But Apt said there are some hopeful signs, such as the Shell Oil Co. plan to build a petrochemical plant to turn Marcellus gas into other consumer and industrial products including plastics. It’s widely believed if Shell moves ahead with plans to build that $2 billion plant north of Pittsburgh, other small industries will follow.

For now, it looks like the Marcellus region will be in the top production spot for several years, analysts say. While drilling has slowed, there were still 288 new well permits issued in May, and more than 1,200 for the first five months of the year, according to data from LCI Energy Insight, an El Paso firm that tracks national energy trends.

Click here for more information.

Today's Links

PHMSA Orders Enbridge to Submit Lakehead Safety Plan

Underground Gasoline Pipeline Will Run from Norco, La., through Lake Pontchartrain, to Mississippi

BP, Transocean and Halliburton Setting Aside Billions for Possible Deepwater Settlement

Report: Concerns over Guar Supply Overblown


Earl’s Pearl of the Day: "Study without desire spoils the memory, and it retains nothing that it takes in.” — Leonardo da Vinci



August 2, 2012

Transocean CEO: Making Progress on Deepwater Horizon Resolution

Transocean Ltd. is making progress toward a settlement in the Deepwater Horizon case, Chief Executive Officer Steve Newman said Thursday.

Transocean owned and operated the drilling rig that exploded in the Gulf of Mexico in April 2010, killing 11 people and sending massive amounts of crude oil into the U.S. Gulf of Mexico. The rig was leased by BP PLC.

A trial at a federal court in New Orleans is scheduled for January and "we are well prepared to defend the company in court if necessary,” Newman said. "At the same time, we continue to explore the possibility of a resolution.”

When the company disclosed its earnings results late Wednesday, it said it set aside an additional $750 million in estimated loss contingency for Deepwater Horizon related expenses, an amount Newman said "reflects our efforts in this regard.” Analysts with Tudor, Pickering, Holt & Co. said the Deepwater Horizon contingency estimates now total $1.95 billion.

Newman said he believes "we are making progress” in the negotiations.

Click here for more information.

Today's Links

U.S. Bolsters Gulf Naval Presence

Tesoro to Ship Bakken Crude

Clinton Urges Sudan, South Sudan to Resolve Oil Row

Oil Companies Provide Different Shale Accounts


Earl’s Pearl of the Day:"Success is the ability to go from one failure to another with no loss of enthusiasm.” — Sir Winston Churchill



August 2, 2012

U.S. Oil Reserves Jumped in 2010

U.S. energy officials estimate oil and natural gas reserves jumped in 2010 by the highest margin in at least three decades, lending weight to the idea the United States can meet more of its own energy demand.

The Energy Information Administration (EIA) said in its annual report proven reserves of crude oil jumped by 13 percent, with the highest increases seen in Texas, North Dakota and the Gulf of Mexico. Proven reserves of natural gas rose by 12 percent.

The increases were the highest recorded by EIA since it began publishing the estimates in 1977. "These reserve increases underscore the potential of a growing role for domestically produced hydrocarbons in meeting both current and projected U.S. energy demands,” EIA Chief Adam Sieminski said.

The EIA’s estimates identify how much oil or natural gas can be produced with reasonable certainty, given current economics and existing technology. Higher oil prices, which make it profitable to do more types of drilling, helped to boost the oil reserves in 2010. The increased use of hydraulic fracturing, meanwhile, helped to buoy the amount of natural gas reserves by allowing operators to tap into supplies locked in shale rock formations.

The jump in energy reserves comes as lawmakers are debating how quickly the United States should be expanding domestic production. Earlier this year, Republicans criticized the Obama Administration for keeping a lock on offshore drilling in the Atlantic and Pacific oceans. The administration says it wants to promote oil drilling in areas where resources are known to exist and production already takes place.

The EIA estimates show 25.2 billion barrels of oil could be recovered in the United States, up from the previous estimate of 22.3 billion barrels. Current U.S. petroleum consumption is about 7 billion barrels annually.

Natural gas reserves are estimated at 318 trillion cubic feet (tcf), up from the previous estimate of 284 tcf. Annual U.S. natural gas consumption is about 24 tcf.

Click here for more information.


Today's Links


Republicans Seek to Force Spill Report Testimony


Mississippi Lime Play Sprawls Northward into Nebraska

Lobbyist for Keystone: ‘They Want to Eliminate Fossil Fuel Use’

Russia Watchdog Seeks to Widen Offshore Access for Oil Producers


Earl’s Pearl of the Day:"It is easier to get forgiveness than permission.” — Stuart’s Law of Retroaction



August 1, 2012

Shell Takes Key Step on Scaled-back Alaska Drilling

Shell has begun preparations to install anchors at the site of one of its planned wells in the Chukchi Sea north of Alaska — a major step toward launching a new era of Arctic oil exploration, even as the company has been forced to scale back its drilling plans.

Delays in construction of an emergency spill containment barge, last-minute problems with an essential air pollution permit and stubborn sea ice still clinging to Alaska’s coast have shortened the company’s drilling window. And now Shell believes just two out of 10 wells planned for the Beaufort and Chukchi seas are likely to be completed this year.

Even those might be tough, conceded Shell Alaska Vice President Pete Slaiby. "We hope we get two wells drilled to completion,” he said. "But it’s going to be a challenge.”

Shell has to stop drilling in hydrocarbon-bearing zones by Oct. 31 in the Beaufort Sea and Sept. 24 in the neighboring Chukchi Sea. Shell also will be forced to suspend operations in the Beaufort Sea to allow native Alaskans time to hunt the bowhead whale that migrate through the area; whether the company can resume work there this year would be up to Interior Department officials.

Operations have to be managed around sea ice, which can swiftly encroach on ships in fall. One of Shell’s ice management vessels is in the Chukchi Sea now, and another, the Aiviq, is set to soon deliver the first set of anchors that will be used to position the Noble Discoverer drillship above the company’s Burger prospect.

Slaiby said the deployment of the anchors — which each will take about eight hours to set — marks a "red letter day.”

The development also underscores Shell’s confidence it will be allowed to drill, even though it still must secure Interior Department permits for individual wells and win other approvals.

The EPA has yet to rule on a request by Shell to waive some emissions limits in a permit governing pollution from the Discoverer drillship.

And as of mid-Tuesday, Shell was still working on the classification and inspection of the newly built Arctic Challenger oil spill containment barge required under its government-approved spill response plan.

Slaiby said he expects sea trials of the barge to begin this weekend, paving the way for Shell to seek a "certificate of inspection” from the Coast Guard before the Challenger gets under way.

Click here for more information.

Today's Links

U.S. Senate Revives Fuel Cell and Hydrogen Caucus

Freeport in Talks with Shell to Export LNG from U.S.

MSC: Drought Effects Pose Problems for U.S. Refiners

Sports Star Set to be New Face of Coal


Earl’s Pearl of the Day: "Act as if it were impossible to fail.” — Dorothea Brande



July 31, 2012

CB&I Makes Deal to Buy Shaw Group

Engineering and construction firm Chicago Bridge & I Co. (CB&I) has agreed to buy another industry player in a $3 billion cash and stock deal that will create one of the largest firms of its kind, executives announced Monday.

Both companies — CB&I and The Shaw Group — are involved in historic projects worldwide, including the first nuclear reactors permitted for construction in the United States since 1978.

The combined business will have about 50,000 employees, a talent base CB&I President and CEO Philip K. Asherman said was a key part of the deal for the two engineering, procurement and construction companies. Together, they will have more than $28 billion in contract commitments for future work.

CB&I, which is based in The Hague but operates out of The Woodlands,Texas, and Baton Rouge, La.-based Shaw expect the deal to close in the first quarter of 2013.

"This scale places us in a position where we’ll be one of the largest western companies in the business and likely the largest company in terms of resources targeted to the energy sector,” Asherman said.

CB&I will acquire Shaw for $46 a share, including $41 per share in cash and $5 in CB&I equity, the companies said. The deal will be funded with cash from both companies as well as $1.9 billion in debt. Asherman will remain president and CEO of the expanded company, while Shaw Chairman, President and CEO J.M. Bernhard Jr. will leave the company.

The Shaw brand will remain a part of CB&I, as a unit called CB&I Shaw, which will build on its prior relationships with governments and private clients as part of its environmental and infrastructure division, among other focuses. Asherman said the business would continue to have a strong presence in Louisiana.

"We see only additional opportunity for those 4,500 employees in all the areas in Louisiana and we expect to continue that,” he said. "It will not be a migration to Texas.”

Click here for more information.


Today's Links

BP in Talks on Potential U.S. Gas Exports

U.S. Officials Call Gulf Spill Drill a Success

Saudi Oil Output Seen at Record Pace

More College Grads Want to Work for Energy Firms


Earl’s Pearl of the Day:"The foolish man seeks happiness in the distance, the wise grows it under his feet.” — James Oppenheim



July 30, 2012

Eagle Ford a Contender for Top U.S. Play

Highly productive wells and the vast size of the Eagle Ford Shale are combining to make the South Texas shale play a contender for being the nation’s best, according to a new report.

The report, from information and analytics firm IHS, looked at well performance for oil and oil-rich liquids in the Eagle Ford as well as in the Bakken Shale of North Dakota and Montana, currently the nation’s top play. The Bakken has more wells than the Eagle Ford, but so far, on a per well basis, the Eagle Ford seems to be producing more than the Bakken.

The IHS analysis shows "Eagle Ford drilling results appear to be superior to those of the Bakken,” said Andrew Byrne, director of equity research at IHS and the study’s author.

The Bakken shale is the play against which others are measured, Byrne said, because "it was the key play that really opened up development of unconventional resources” using high-tech drilling methods and hydraulic fracturing.

"The results from the Bakken were so strong it set the standard by which all others will be measured. It was the one play that incited the industry into pursuing these opportunities,” he said.

Wells in the Eagle Ford Shale have a stronger flow — 300 to 600 barrels a day of oil and oil-rich liquids, based on average production in a peak month — than in the Bakken, where flow ranges from 150 to 300 barrels a day."

One of the reasons we really like the Eagle Ford is its potential as a large total resource. It could be one of the best, if not the best, in North America,” Byrne said.

The Eagle Ford sweeps 400 miles from East Texas to counties south of San Antonio and on to the border.

The play "gets uniformly strong results, and that’s making the play look that much bigger and better,” Byrne said.

Click here for more information

Today's Links

Emergency Drill Tests Containment Equipment in Gulf

Sabic and ExxonMobil’s $3.4 Billion Elastomers JV Will Help to Create a Major Rubber Industry in Saudi Arabia

Repsol Follows BP into Namibia on Prospects for First Oil

Students Explore Career Options at Marcellus Camp


Earl’s Pearl of the Day:"A wise man can see more from the bottom of a well than a fool can from a mountain top.” — Unknown



July 27, 2012


Bakken Crude Reaching Louisiana Refiners by Barge

Surging oil production in the land-locked Bakken Shale is finding a new outlet on one of America’s first highways — the Mississippi River.

Kirby Corp. said it is shipping crude from the Bakken, an oil rich shale located in North Dakota and Montana, to refiners in Louisiana using barges on the Mississippi, the first major barge operator to do so. The move comes as producers in the Bakken, where production is growing faster than energy companies’ ability to ship it out, scramble to get their crude to more profitable markets.

The phenomenon underscores the growing geographic reach of U.S. light, sweet crude, a bounty that has been unlocked in recent years by advanced drilling techniques. It will give more Gulf Coast refineries access to the relatively inexpensive crude that has driven profits for their Midwest competitors.

Last weekend in St. Louis, Kirby loaded a unit-train of Bakken oil on its barges that had arrived by rail. The barges take a week to travel down the Mississippi River to bring the oil to the Baton Rouge, La., area, said company spokesman Steve Holcomb.

"We’ve moved Canadian tar sands from St. Louis before, but this is the first time we have loaded crude oil that originated out of the Bakken,” Holcomb said.

The Mississippi oil trade, which barely even existed until 2007, has until now been conducted by less than 100 barges operated by small, private companies. The business should start seeing more Bakken oil traffic now that Kirby, which owns more than quarter of the country’s tank barges, has shown it thinks the trade profitable, said Kevin Sterling, analyst at BB&T Capital Markets.

The oil will be welcome at the 19 refineries in Louisiana, many of which are large facilities operated by Exxon Mobil Corp., Phillips 66 and Marathon Petroleum Corp. Louisiana is the second largest refining state in the United States after Texas, according to the Energy Information Agency.

Rail cars have so far been the main mode of transport for oil out of the Bakken but the increase in traffic has made rail cars harder to come by and barges more attractive for deliveries, said John Heida, director of North American oil research at analyst-firm IHS.

"The volume of oil coming out of the Bakken might not change, but [barges] will make it easier to get it down to the Gulf Coast,” Heida said.

Click here for more information.

Today's Links

TransCanada Gets Gulf Coast Pipe Nod

Shell Scales Back Arctic Drilling Plans

Energy and Jobs Act Could Reduce Unemployment and Help Faltering Economy

Pickens: Let’s Make the Switch to Natural Gas


Earl’s Pearl of the Day:"The knowledge that you have emerged wiser and stronger from setbacks means that you are, ever after, secure in your ability to survive.” — J. K. Rowling


July 26, 2012


House Rejects Obama Administration Drilling Plan

The House of Representatives rejected an Obama Administration plan for selling offshore drilling leases over the next five years and instead voted to replace it with a more aggressive GOP alternative.

Although a bipartisan coalition of Senators introduced a similar proposal, neither pro-drilling measure is expected to clear Congress, much less with the support needed to override President Barack Obama’s threatened veto.

Still, Republicans were able to muster a strong showing of support for their plan, which passed 253-170 and would schedule 29 offshore oil and gas lease sales over the next five years, nearly double the 15 that would be allowed under the administration’s existing schedule. In a separate 164-261 vote, the House rejected the administration’s five-year plan, which was formalized in late June.

"The bipartisan plan passed today is what a real vision for America’s energy future should look like — more American jobs, more American energy and less dependence on unfriendly foreign countries,” Rep. Doc Hastings (R-Wash.) said.

Hastings’ bill would schedule 29 lease sales and give oil companies several opportunities to bid on drilling rights in the Chukchi and Beaufort seas north of Alaska. The measure also would schedule a sale of North Aleutian Basin drilling rights in 2016 and give energy companies two cracks at leases off the south California coast in 2014 and 2017.

The GOP bill also would force a sale of offshore drilling leases in an area off the coast of Virginia, which was originally scheduled for 2011 but indefinitely postponed amid opposition from leaders in neighboring northern states and concerns raised by the Defense Department, which conducts exercises in the region.

In the Senate, a bipartisan coalition led by Sen. Lisa Murkowski (R-Alaska) introduced another drilling plan. It was co-sponsored by Sens. Jim Webb (D-Va.), Mark Warner (D-Va.), Mary Landrieu (D-La.), John Hoeven (R-N.D.) and Jim Inhofe (R-Okla.).

The Senate plan would schedule 27 lease sales, including auctions of tracts off the mid-Atlantic Coast. It also would provide a big incentive to states to endorse drilling in nearby waters by giving them a 37.5-percent cut of any federal royalties derived from oil and gas drilling off their coasts. Similar revenue-sharing proposals have been controversial in the Senate.

Click here for more information.


Today's Links

INGAA: Firm Supply Contracts Would Encourage Pipeline Growth

Shell May Trim 2012 Alaska Drilling for Inspections, Ice

Biofuels Battle Ignites Again

Fracking Best Practices: Top 10 Recommendations


Earl’s Pearl of the Day:"Nothing is permanent in this wicked world, not even our troubles.” — Charlie Chaplin


July 25, 2012

Fight Over Drilling Ban Postponed – For Now

The anticipated showdown between House Republicans and Interior Department officials over the Obama Administration’s decision to temporarily halt deepwater drilling after the 2010 Gulf oil spill won’t materialize today.

House Natural Resources Committee Chairman Doc Hastings (R-Wash.) postponed his panel’s planned hearing with Interior Department officials late Tuesday after he said the administration did not commit the invited witnesses would attend the hearing. Hastings said the rescheduled hearing, expected to occur in September, would allow time "to ensure cooperation.”

The panel has been investigating how the Interior Department assembled a report that recommended a moratorium on some drilling in the Gulf of Mexico roughly a month after the lethal blowout of BP’s Macondo well. The committee is probing whether the report was packaged and edited so it appeared professional engineers and industry experts who peer reviewed the document signed off on the recommendations, including the urging for a moratorium.

Eight of 15 experts named in the report insisted they did not endorse the ban recommendation and said it was added only after they reviewed the document.

Hastings has repeatedly rapped the Interior Department for stonewalling the committee’s investigation.

"There is a clear pattern of actions by the Interior Department to withhold information and answers on the administration’s falsely edited report and decision to impose a Gulf drilling moratorium that cost thousands of jobs, inflicted widespread economic harm and restricted American energy production,” Hastings said.

Administration officials have stressed they have given the committee nearly 2,000 pages of documents and cooperated with the probe.

"We will continue to work with the committee to meet their legitimate oversight interests,” said Interior Department spokesman Blake Androff.

Click here for more information.


Today's Links



July 24, 2012


U.S. Republican Lawmakers in New Bid for Keystone Pipeline Approval

Republican lawmakers are making another attempt to push through approval of the Keystone XL oil pipeline, saying the purchase of Canadian energy producer Nexen Inc. by China’s Cnooc Ltd. demonstrates why the United States should move quickly to allow the flow of Canadian oil.

The latest effort to speed up approval for the pipeline comes from Rep. Lee Terry (R- Neb.), a member of the House Energy & Commerce Committee, who disclosed a bill Monday that would allow construction of the pipeline without what is known as a presidential permit.

The Keystone XL pipeline was initially proposed as a 1,700-mile pipeline that would stretch from Alberta to the Gulf Coast, carrying oil from Canada’s tar sands. Without a presidential permit to move across the U.S. - Canada border, pipeline sponsor TransCanada Corp. decided to move ahead with a southern portion of the pipe that didn’t require a permit.

The U.S. State Department is currently reviewing TransCanada’s plans for the northern portion. It said it will make a decision on whether to approve them by the early part of 2013.

Supporters of Keystone said Canada will start to look for alternative ways to ship its oil out of the country if the United States doesn’t grant permission for the pipeline to snake down to the Gulf Coast. Cnooc’s purchase of Nexen confirms other countries are interested in Canada’s energy supplies, Republicans said.

"We can no longer afford to have important energy issues held hostage by election day politics,” Terry said.

The House has previously approved legislation that imposes a deadline on a decision for Keystone XL. Most recently, House Republicans pressed to have the legislation attached to a broader transportation bill, which was being negotiated between House and Senate lawmakers, but failed to win allies in the Senate.

Click here for more information.



Today's Links

First Offshore Sale Under 2012-2017 Leasing Program Announced

Spill Report Faults BP, Transocean

Rosneft Starts Talks With BP to Buy Stake in Russian Venture


China Seeks N. American Energy Reserves, Know-how



Earl’s Pearl of the Day:
"The reward of a thing well done is to have done it.” — Ralph Waldo Emerson




July 23, 2012


Williams Partners to Buy Stake in Olefins Facility

Williams Partners LP and Williams Cos. will pursue an agreement for Williams Partners to acquire Williams’ 83.3-percent interest in the olefins production facility in Geismar, La., in a deal that will bring more certainty to the energy company’s cash flows.

"Adding the Geismar olefins production facilities to Williams Partners’ portfolio would immediately reduce the partnership’s exposure to the ethane market by nearly 70 percent and it would nearly eliminate it by 2014,” Williams Partners Chief Executive Alan Armstrong said.

The Geismar facility is a light-end natural-gas liquid cracker with volumes of 37,000 barrels per day of ethane and 3,000 barrels per day of propane and an annual production of 1.35 billion pounds of ethylene. Williams Partners said the facility’s annual ethylene production capacity will grow by 600 million pounds to 1.95 billion pounds by late 2013 as a result of a $350 million to $400 million expansion currently under way.

Williams Partners will fund the transaction largely with the issuance of limited partner units to Williams. Williams currently owns 68 percent of Williams Partners.

Pipeline companies in the United States are undergoing a wave of acquisitions and expansion as they seek to adapt to the new geography of energy production brought about by shale production. Williams Partners in March unveiled a $2.5 billion deal to acquire Caiman Eastern Midstream LLC, which has midstream facilities in the Marcellus Shale, a major unconventional shale energy field that underlies several Northeastern states.

Click here for more information.



Today's Links

Shell Wins Coast Guard OK on Changes to Arctic-bound Barge

DOE Sees Vast Energy Resource in Residual Oil Zones

Report Says Offshore Industry Falls Short on Key Safety Monitoring

CNOOC to Acquire Nexen for $15.1B


Earl’s Pearl of the Day:"To avoid situations in which you might make mistakes may be the biggest mistake of all.” — Peter McWilliams




July 19, 2012

House Committee Approves Oil Drilling in Atlantic, Pacific Oceans

The House Natural Resources Committee approved a bill Wednesday to allow oil drilling in the Atlantic and Pacific Oceans, attempting to expand U.S. energy production beyond a five-year plan recently released by the Obama Administration.

Congress lifted a formal block on drilling in the Atlantic and Pacific in 2008, but the Obama Administration hasn’t yet allowed oil companies to buy drilling leases in those areas. Instead, the administration has directed companies to explore in the oil-rich Gulf of Mexico and plans to open up the Arctic Ocean.

The bill, introduced by committee Chairman Doc Hastings (R—Wash.), would force the federal government to hold nearly twice as many drill lease auctions from now until 2017 as the Obama Administration has proposed. It would also force the government to open up areas that have been offlimits for several decades.

The bill passed by a vote of 24 to 17.

Drilling in the federal waters of the Pacific is widely opposed by lawmakers in those coastal states. Drilling in the Atlantic, however, is supported by many in the area. Virginia lawmakers have been particularly vocal about their support for drilling off their shores.

Click here for more information.



Today's Links

Small Businesses Cheer Delta, Braskem Reuse Plans

Kinder Morgan and BP North America Enter into Long-term Agreements

API: Oil Well Completions Up in Second Quarter, Gas Wells Down From Year Ago Levels

Shell-led Arctic Push Finds United States Shy in Icebreakers



Earl’s Pearl of the Day:
"Not everything that can be counted counts, and not everything that counts can be counted.” — Albert Einstein



July 17, 2012


More Setbacks Plague Shell’s Arctic Push

Shell’s plans to launch exploratory oil drilling in Arctic waters this summer have been hit by a series of setbacks in recent days, as one of its drillships drifted out of control and the company admitted it won’t be able to comply with the terms of a government-issued air pollution permit that took years to refine.

The developments mark the most recent troubles for Shell Oil Co.’s seven-year quest to begin a new era of drilling in the Chukchi and Beaufort seas, decades after first searching for oil under those Arctic waters. Mother Nature had already postponed plans to drill up to five wells in the region until early August, because thick ice is clinging to Alaska’s shore and preventing ships from passing through.

Shell spokesmen say they don’t expect further delays after the Noble Discoverer drillship dragged its anchor and drifted toward an island near Dutch Harbor, Alaska, on Saturday.

Later this week, divers are expected to investigate the vessel’s hull for signs of damage amid varying reports of how close the ship came to shore. According to initial estimates, the ship stayed 100 yards from shore, but in a photo taken by a Dutch Harbor captain, the 571 foot ship appears to have run aground much closer to land.

"All indications are that it did not run aground,” Shell spokeswoman Kelly op de Weegh said. "But our priority is to make sure there are no integrity issues with the Discoverer. That’s why we’re going to send divers down as another precaution.”

Shell also has drawn fire for asking the EPA for leeway after determining it would not be able to comply with emissions limits in key air pollution permits for its Arctic operations. Shell is asking to be allowed to emit an unlimited amount of ammonia and more nitrogen oxide than originally permitted from the Discoverer’s main generator engines.

At one point, Shell told the EPA in its request, the company had spent nearly $24 million trying to buy, install and test an emission control system that would allow the engine to meet the approved limits and still fit into a tight space in the Discoverer’s engine room.

Shell’s op de Weegh stressed the Discoverer will still satisfy ambient air standards for nitrogen oxide since the generator engines are not the biggest source of that substance.

The EPA is considering Shell’s request to allow the Discoverer to operate in 2012 and then consider permit revisions for next year.

Click here for more information.



Today's Links

Helix Energy Announced Oil Discovery in Gulf of Mexico

Obama Greenlights US O&G Investment in Myanmar

States, Oil Producers See Regulatory Problems on the Horizon

Deputy Energy Secretary: Technology Key to Harnessing Natural Gas Potential


Earl’s Pearl of the Day:
"We find no real satisfaction or happiness in life without obstacles to conquer and goals to achieve.” — Maxwell Maltz




July 16, 2012

All Three Galapagos Fields Flowing in Gulf of Mexico

All three wells in the deepwater Galapagos development in the Gulf of Mexico are producing, reports Noble Energy Inc., operator of two of three fields in the complex.

BP PLC started Galapagos development in June at Isabela field, which it operates. It said gross Galapagos production would peak at about 60,000 boe/d.

Since then, Noble has started production from the other fields, Santiago and Santa Cruz. Production from the subsea fields flows to the Na Kika facility operated by BP. Water depths in the area, which is 140 miles southeast of New Orleans, are about 6,500 feet.

Noble said it will halt appraisal of its subsalt Deep Blue prospect in 5,100 feet of water on Green Canyon Block 723 off central Louisiana, although the initial well and a sidetrack encountered hydrocarbons. Drilling of the sidetrack was interrupted by the moratorium imposed on Gulf activity after the Macondo blowout in April 2010.

Click here for more information.



Today's Links

A Liquid Market: LNG

UAE Starts Up Pipeline to Bypass Strait of Hormuz

Shell Seeks to Weaken Air Rules for Arctic Drilling

Lawmakers Ask Feds to Step Up Scrutiny of Arctic-bound Greenpeace Ships


Earl’s Pearl of the Day:
"We must accept that this creative pulse within us is God’s creative pulse itself.” — Joseph Chilton Pearce


July 13, 2012

Cheniere Finds Funding for LNG Export Terminal

Cheniere Energy said it expects to receive about $3.4 billion in financing by month’s end for what could be the first LNG export facility in the continental United States.

An export facility in the lower 48 states will allow U.S. natural gas producers to export the fuel, which has become plentiful as new drilling techniques have unlocked gas in shale formations throughout the country.

Cheniere’s financing from eight banks, together with $2 billion in equity the company offered in May, will allow it to export 1.1 billion cubic feet a day of LNG from its Sabine Pass, La., terminal by the end of 2015.

"They have all the capital they need, they have all the permitting they need,” said Will Frohnhoefer, analyst at equity brokerage BTIG. "I think they’re good to go.”

The Houston-based company expects to close on the financing at the end of the month and sign a final investment decision by the end of summer. Company officials wouldn’t comment further on the financing.

Cheniere opened the Sabine Pass facility as an LNG import terminal in 2008, when it was widely believed the United States would need to import natural gas to meet its energy needs. But the shale drilling in recent years has turned that on its head.

Now, low prices in the Unites States are attracting customers from overseas, where natural gas costs are exponentially higher. At the same time, the price drop has crimped the balance sheets of energy companies extracting the fuel.

Cheniere already has permits to export LNG, which were issued before low natural gas prices stirred interest in exports. But the U.S. Department of Energy has suspended approval of new LNG export permit applications as it studies the possible economic effects of LNG exports. Its report is expected after November.

Cheniere expects to lock in another round of financing by the end of 2013 to construct an additional 1.1 billion cubic feet a day in export capacity at Sabine Pass.

Click here for more information.



Today's Links

API: Industry Strives for Highest Pipeline Safety Standards

Scientists Report Progress in Economics of Algae-Based Biofuel


Abu Dhabi Leads Gulf Nations with Oil Pipe to Avoid Iran

Algeria to Ink Partnerships with Shell, Exxon on Shale Gas


Earl’s Pearl of the Day:
"Vision without action is a daydream. Action without vision is a nightmare.” — Japanese Proverb




July 12, 2012

United States, Canada to Drive 2013 Non-OPEC Oil Supply Gains

Oil supplies from outside of the Organization of Petroleum Exporting Countries may increase 1.3 percent next year as the United States and Canada increase production of unconventional oil, the International Energy Agency (IEA) said.

Non-OPEC supply may increase by 700,000 barrels a day from 53.2 million this year as output grows from tight oil in the United States and Canadian synthetic crude, the Paris-based agency said in its monthly Oil Market Report.

"The majority of the growth this decade has been and will continue to be oriented toward the Americas,” the IEA said. "With quickly declining offshore Brazilian production, the major source of growth outside OPEC countries will be the United States and Canada.”

Output in Texas could climb above 2 million barrels a day next year, a level not seen since 1988, as tight oil from the Eagle Ford play could add 180,000 barrels a day, while North Dakota’s Bakken tight oil should increase daily production by about 130,000 barrels a day, the agency said.

The biggest additions to Canadian supply will come from Imperial Oil Ltd. Kearl bitumen mining project and Suncor Energy Inc. steam assisted Firebag project, adding 50,000 barrels a day and 20,000 barrels, respectively.

Click here for more information.



Today's Links

Making Plans for the U.S. Derivatives Wave

Shell Touts Progress of Ho-Ho Pipeline Reversal

China, United States Seek to Calm South China Sea Tensions

Revise Obsolete Federal Renewable Fuel Mandates, House Panel Urged


Earl’s Pearl of the Day: "The minute you settle for less than you deserve, you get even less than you settled for.” — Maureen Dowd




July 11, 2012

House Panel to Vote on New Offshore Oil Drilling Plan

The House Natural Resources Committee is expected to pass legislation this week that would replace the Obama Administration’s new five-year plan for offshore oil drilling and expand the amount of federal waters made available for drilling.

The bill, scheduled for a vote on Wednesday, would allow oil companies to drill off the coasts of Virginia and California — areas where oil production has been blocked for several years — and to expand drilling in the Arctic Ocean. Environmental groups have been particularly critical of drilling in the Arctic, where they have said icy waters would make it impossible to handle an oil spill.

The legislation would replace a new plan disclosed in June by the Interior Department to hold 15 auctions for oil drilling leases in the Arctic and Gulf of Mexico between now and 2017. What is known as the five-year plan serves as a blueprint for oil companies seeking to drill for oil in federal waters.

Republicans and oil companies have been quick to criticize President Obama’s five-year plan because it blocks access to the Atlantic and Pacific Oceans. A formal moratorium used to prevent drilling in those areas, but Congress lifted the blockade in 2008. Since then, the federal government has not yet leased any areas in those waters.

Virginia lawmakers have been supportive of drilling off their coast, but West Coast lawmakers have warned against opening up their coasts.

Click here for more information.



Today's Links

Analysts, Shipping Experts: Offshore Hoarding of Oil Imminent

Fitch: Marcellus Shale Giving Boost to U.S. Midstream Firms


Maverick Plans U.S. Campaign

Study: Gulf Oil Spill Might Have Lasting Impact


Earl’s Pearl of the Day: "The habit of giving only enhances the desire to give.” — Walt Whitman




July 10, 2012

Environmentalists to Challenge Shell’s Arctic Spill Plans

Environmental groups are set to file a lawsuit as early as today in a last-ditch bid to block Shell’s plans to drill up to five wells in Arctic waters this summer.

The legal challenge, to be filed in a federal district court in Anchorage, Alaska, will take aim at the Interior Department’s decision earlier this year to approve Shell’s plans for responding to oil spills in both the Chukchi and Beaufort seas north of Alaska. Shell’s oil spill response plans for the region describe a scenario for tackling and encountering 95 percent of oil spilled in an emergency using an underwater containment system and capping stack, as well as skimmers, booms, chemical dispersants and burning to destroy floating crude.

Representatives of several environmental groups argue federal regulators were wrong to sign off on Shell’s plan for cleaning up spilled oil in remote, slushy Arctic waters, where crude could slip under ice and defy traditional methods for lassoing it up. The environmental critics insist Shell is relying on current technology that can only sop up a small percentage of any crude that enters even calm, warm seas — much less the cold, icy Arctic.

But Obama Administration officials have defended the approval and insisted Shell Oil Co.’s plans are robust. In a conference call with reporters, Interior Secretary Ken Salazar predicted there would not be an oil spill in the Arctic because Shell’s preparations have been so heavily scrutinized.

Federal regulators also are requiring Shell to halt its drilling in the Chukchi Sea nearly a month earlier than in the Beaufort, to allow extra time for drilling a relief well in case of an emergency.

Shell spokeswoman Kelly op de Weegh said the company is confident the government’s approvals will withstand legal review.

"These approvals are testament to the huge amount of time, technology and resources Shell has dedicated to an Arctic oil spill response fleet, which is second to none in the world,” op de Weegh said. "If we were not absolutely confident we could execute a responsible exploration program, we would not be there.”

In anticipation of this legal challenge, Shell Oil Co. filed its own lawsuits earlier this year against more than a dozen environmental organizations asking a federal judge to declare some of its government approvals valid, even before legal filings called them into question.

That lawsuit could take months to resolve. But it is possible the new legal challenge could be swept into Shell’s existing case, under U.S. District Judge Ralph Beistline.

One of Shell’s two chosen drilling units is in Dutch Harbor, Alaska, while the company waits for ice to clear before sending it northward. A second drilling unit is still en route to Dutch Harbor.

Company representatives anticipate the earliest they will be able to begin drilling — even if all government approvals are awarded and barring any successful legal challenges — is early August, because of an unusually thick layer of ice clinging to Alaska’s shores.

Click here for more information.



Today's Links


BP Suspends Costly Alaska Oil Project

Liquid Pipeline Operators Invest in Safety

Exxon Starts Angola Offshore Oil Project

Voyager Oil & Gas to Acquire Emerald Oil


Earl’s Pearl of the Day:
"Experience is a hard teacher because she gives the test first, the lesson afterwards.” — Vernon Sanders Law



July 9, 2012

Campaign Aims to Counter Oil Sands Criticism

Manufacturers, refiners, energy companies and pipeline operators that think the promise of Canadian crude is getting lost in the criticism of it have formed an initiative to promote the fossil fuel.

"If you don’t stand up for yourself or aren’t seen as sticking up for yourself, why should [others] stick up for you?” asked Travis Davies, a spokesman for the Canadian Association of Petroleum Producers, which is participating in the campaign.

It comes amid scrutiny of the techniques energy companies use to harvest bitumen from Canada’s oil sands and the proposed Keystone XL pipeline that would deliver the crude from Alberta to Gulf Coast refineries. The opposition to oil sands development surprised some advocates, just as industry leaders were caught off guard by the recent public backlash against the hydraulic fracturing process used to extract natural gas.

Environmentalists have battled Keystone XL by focusing on concerns about its initial route through the drinking water supplies of the Ogallala Aquifer in Nebraska. Many say, however, a larger worry is more pipelines would expand the marketplace for oil sands crude, which generates more greenhouse gas emissions than other oil.

The life cycle emissions of oil sands crude — from the wellhead through combustion — are 5-percent to 15-percent higher than for the average barrel of imported crude, according to an IHS CERA analysis.

The new initiative, known as Oil Sands Fact Check, is battling back, with reports touting the benefits of the product and countering opponents’ claims.

The campaign is the brainchild of the American Petroleum Institute (API), which already had been aggressively lobbying the Obama Administration to permit the Keystone XL pipeline.

Oil Sands Fact Check, by contrast, is more focused on providing information, research and experts on the oil sands, said Cindy Schild, API’s senior manager for downstream operations.

The campaign is borrowing a page from "Energy In Depth’s” playbook, with regular "issue alerts” to reporters and others, and plans for touting the message via Facebook, Twitter and other social media. To lure in critics as well as supporters, the group has ads that appear on Google when users search for "tar sands” — a synonym often used derisively — and other related terms.

"What we’re trying to do is really just get the facts out on the benefits of oil sands, how energy is derived from oil sands and to continue to describe the opportunity, and, really, the energy security benefits and job benefits,” Schild said.

A major concern for the group is countering claims oil sands crude is dirtier than other crudes.

"When you look at life cycle — well-to-wheels — it is comparable to other crudes that are refined in the United States, including crudes from California, Mexico and Venezuela,” Schild said.

Click here for more information.


Today's Links

EIA: Electric Power Generation from Coal, Gas Equal in April

Chevron Makes Huge Investment In Challenging North Sea Area

Dispersant’s Use Adds Subplot to Oil Spill Saga

Ford Thinks Small; Tiny Engines Help Company Boost Fuel Economy


Earl’s Pearl of the Day: "Holding onto anger is like grasping onto a hot coal with the intent of throwing it at someone else. You are the one who gets burned.” — Buddha




July 6, 2012

United States Hits Record Exports of Diesel, Other Distillate Fuels

U.S. distillate fuel exports hit a record high in April as production grew and imports fell to the lowest in 27 years, according to a report by the U.S. Energy Information Administration.

In April, the United States shipped a net 981,000 barrels of distillate fuels per day — primarily diesel and heating oil. For comparison, that’s nearly as much gasoline as the United States uses every three hours.

The country transformed from a net importer of distillates to a net exporter in 2008 as fossil fuel production started to surge and the domestic energy needs slowed amid the economic recession.

The nation’s gross daily distillate fuel exports were up 29 percent during the first four months of the year, compared to the same period in 2011. Meanwhile, imports fell 42 percent. April marked the lowest import volumes since 1985.

Global demand for distillate fuels has grown as developing economies have expanded in recent years, according to the International Energy Agency. Mexico and South America have been the United States’ biggest customers, attracting 60 percent of its distillate exports. Refineries in those regions haven’t kept up with robust demand growth.

Click here for more information.



Today's Links

Nigeria Teams Up with U.S. Firm to Build Six Oil Refineries

Eight Energy Companies Showing Interest in Afghan O&G

ConocoPhillips, Origin OK 2nd stage of LNG venture

EPA Finalizes Greenhouse Gas Requirement, Keeps Tailoring Rule


Earl’s Pearl of the Day:
"Concern for someone else was a good remedy for taking the mind off one’s own troubles.” — Elizabeth Aston



July 5, 2012

CSB Set to Release Deepwater Horizon Probe Findings in Houston

The Chemical Safety Board (CSB) is set to release the initial findings from its probe of the Deepwater Horizon disaster during a two-day hearing in Houston later this month.

The independent federal agency also will scrutinize how refiners are assessing and boosting the safety of their operations by tracking leading and lagging indicators of problems, seven years after the BP Texas City, Texas refinery explosion that killed 15 workers and injured 180 others.

The CSB probed the Texas City disaster as well as more than 50 other industrial accidents. It is the last remaining government panel still investigating the April 20, 2010 blowout of BP’s Macondo well in the Gulf of Mexico and the fatal rig explosion that followed.

CSB Chairman Rafael Moure-Eraso promised the July 23-24 hearing would "provide a unique opportunity for safety experts from around the world to share information and discuss the most advanced work in the area of safety performance indicators for major accident prevention in high-hazard industries.”

The CSB has investigated whether fatigue was a factor in the Macondo well blowout, especially since workers on Transocean’s Deepwater Horizon drilling rig had just moved from a 14-day work schedule to one where they worked 21 days in a row.

The CSB also has been taking a close look at the blowout preventer that failed to successfully sever drill pipe and seal off the Macondo well hole. A forensic team that examined that device for the Interior Department and Coast Guard concluded the drill pipe was pushed askew by oil and gas surging out of the well, preventing the shearing blades from cutting cleanly through the pipe.

Because of its unique role as an independent federal agency, the CSB could go further than some other investigations in assessing whether regulation of offshore drilling was too lax and contributed to the Deepwater Horizon disaster.

The public hearing will take place July 23-24 at the Hyatt Regency Hotel, 1200 Louisiana St. in Houston.

Click here for more information.



Today's Links

Trainer Refinery Workers Prepare for Jet-Fuel Production

Pemex Finds Natural Gas Reserves in Deepwater Gulf

Hydraulic Fracturing Legislation Approval Ensures Better Energy Future for North Carolina

Geoscientist Pens Energy Novel Set in Alaska


Earl’s Pearl of the Day:
"Some of the most devastating things that happen to you will teach you the most.” – Ellen DeGeneres




July 3, 2012

New Deepwater Well Rules Coming Soon

The federal government soon will issue a final set of standards meant to strengthen the design and cementing of offshore wells in the wake of the Deepwater Horizon disaster two years ago.

James Watson, the director of the Interior Department’s Bureau of Safety and Environmental Enforcement, said the drilling safety measure is under final review by the Office of Management and Budget.

When the rules come out, they will tweak existing mandates issued in October 2010 in response to the lethal blowout the previous April of BP’s Macondo well in the Gulf of Mexico.

Those rules essentially codified industry’s existing best practices for designing and securing offshore wells. The regulation also imposed new requirements for certifying, inspecting and maintaining blowout preventers, the emergency devices attached to wells as a last line of defense against unexpected oil and natural gas surges.

Interior Department officials have signaled they may propose requiring offshore drillers to add a second set of blind shear rams to improve the likelihood the devices will cut through drill pipe to seal a well in an emergency. They also have made clear they want blowout preventers to be equipped with better sensors that can tell operators how the devices are functioning and the positions of key components.

But FBR Capital Markets Analyst Benjamin Salisbury warned if the government requires a second shear ram, which would be bigger and take up more space, it could make dozens of deepwater rigs obsolete without major upgrades.

Watson has said his agency will consider a phase-in period so manufacturers have time to redesign blowout preventers and to get the equipment to the marketplace.

Click here for more information.



Today's Links

ExxonMobil Interested in Exploring for Oil in Afghanistan

Lawmakers: Speed Up Natural Gas Exports

South Texas Refinery in Right Place at Right Time for Eagle Ford Oil

U.S. Should Ratify Law of the Sea Treaty, Senate Panel Told


Earl’s Pearl of the Day:"What counts is not necessarily the size of the dog in the fight —it’s the size of the fight in the dog.” — Dwight D. Eisenhower




July 2, 2012

Nation’s Energy Transportation Getting a Revamp

The nation’s energy transportation network is undergoing a multibillion-dollar overhaul, as oil and natural gas production surges in new regions of the country.

Across North America, pipelines and rail terminals are being built in areas where wells were once scarce. Companies are reversing pipe flows and adding stronger pumps to funnel more crude through their lines.

The changes are transforming the web that carries energy across the country. Historically, fossil fuels flowed north, from oil fields in Texas toward the nation’s big cities. But energy producers have charged into new areas with technology that can reach oil and natural gas trapped in shale and other tight rock formations.

Pipelines haven’t moved as quickly as drilling rigs, leaving pools of crude and gas stranded far from the Gulf Coast refineries and petrochemical plants that need them.

Now companies charged with moving those fuels are rushing to catch up.

"We’re in a renaissance of pipeline construction,” said Andy Black, president and CEO of the Association of Oil Pipe Lines. "There is new North American supply in areas that don’t have a matching amount of pipeline takeaway capacity. So there’s a great demand for transportation of crude and natural gas.”

Still, the nation’s web of pipes isn’t keeping up with the billions of barrels pumped from the ground each year. It can take years for a pipeline to go from concept to construction. It can require many permits and lengthy negotiations with landowners and environmentalists. And that is prompting more energy companies to move their loads by rail.

Phillips 66 is considering buying 2,000 more rail cars, CEO Greg Garland said recently. The new cars would allow Phillips 66, which can refine about 2.2 million barrels of crude per day, to carry an additional 150,000 barrels a day from shale regions to its refineries across the country.

"That’s a pipeline on wheels,” Garland said during an energy conference in June. "It can shift as the opportunity shifts around the country.”

Enbridge is building a rail system in North Dakota to move about 80,000 barrels per day.

Railroads are responding to the demand. Loads coming in and out of shale regions have grown 400 percent since 2009 for Union Pacific. The company has added 785 Texas employees this year and it is funneling millions to expand rail terminals in oil-pumping regions.

Click here for more information.



Today's Links

Shell Moves to Pre-Empt Arctic Drilling Challenges

Sunoco, Carlyle Ink Deal to Save Philadelphia Refinery

UK Study: Good Practice, Regulation Make Fracing Safe

Poll: Voters Back Keystone Pipeline, but Give Obama Edge on Energy Security


Earl’s Pearl of the Day:"You have to dream before your dreams can come true.”— Abdul Kalam




June 29, 2012

Congress to Vote on Funds for Restoring Gulf

House and Senate committees have reached agreement on legislation that would direct most fines resulting from the 2010 Gulf of Mexico oil spill to environmental restoration in the five Gulf Coast states.

The blowout of BP’s Macondo well killed 11 workers and sent crude gushing into the Gulf. It is expected to result in billions of dollars in civil fines under the Clean Water Act. The congressional measure, headed for possible votes in both houses on Friday, would dedicate 80 percent of those fines to the Gulf Coast states affected by the spill.

Under the Clean Water Act, BP and other responsible parties could pay $5.4 billion to $21 billion in penalties, based on whether the parties are deemed negligent and on the government’s estimate that 4.9 million barrels spilled.

"This legislation is of large importance to communities in the Gulf,” said Robert Verchick, an environmental law professor at Loyola University in New Orleans. "Folks on the Gulf see the Restore Act as a way to make the Gulf Coast whole, and develop these ecosystems services so they can benefit the rest of the country.”

The legislation would dedicate funds to programs aimed at restoring the Gulf’s natural resources, ecosystems, fisheries, marine and wildlife habitats, beaches, barrier islands, dunes and coastal wetlands.

Click here for more information.



Today's Links

Interior Unveils 2012-2017 Offshore O&G Leasing Plan

Federal Energy Data Chief Says Crude Exports Would Boost Economy

Shale Gas May Give New Life to Idled Pa. Refinery

BP to Settle Spill-Related Gender Bias Case


Earl’s Pearl of the Day
:
"What is written without effort is in general read without pleasure.” – Samuel Johnson



June 28, 2012

Appeals Court Rejects Arguments Against New Wells

A federal appeals court has rejected arguments by a coalition of environmental groups, who maintain U.S. regulators failed to thoroughly review the potential dangers of drilling new deep wells in the Gulf of Mexico.

The 11th U.S. Circuit Court of Appeals’ decision supports a federal agency’s approval, allowing Shell to move ahead with plans for 10 deepwater wells.

The proposed wells would drill at a water depth of more than 7,000 feet, according to documents from the federal agency.

"One of the wells poses the threat of being Shell’s ‘worst case discharge’ in the Gulf of Mexico in the event of a blowout,” the environmental groups wrote to the appeals court, urging them to block the plans.

However, the appeals court in Atlanta concluded an environmental assessment extensively analyzed the risks and consequences for such an event.

The court’s decision states after taking into account new regulations since the 2010 Deepwater Horizon disaster, the Bureau of Ocean Energy Management determined the risk of another spill was low.

In announcing its approval of the exploration plan last year, the federal agency said its review was done under heightened standards now being used after the Deepwater Horizon explosion and oil spill.

"The standards are higher than they used to be, and further support our goal of ensuring deepwater exploration is done more safely and with greater protections for the environment than ever before,” the agency said.

Click here for more information.



Today's Links

Shell Rigs Start Journeys to Arctic

Exxon’s CEO: Climate, Energy Fears Overblown

Petronas Agrees to Buy Canada’s Progress Energy

U.S. Senators Press for Myanmar Oil Investment


Earl’s Pearl of the Day:
"We find comfort among those who agree with us - growth among those who don’t.” — Frank Howard Clark



June 27, 2012

U.S. Grants a Keystone Pipeline Permit

The Obama Administration, moving swiftly on the president’s promise to expedite the southernmost portion of the disputed Keystone XL pipeline, has granted construction permits for part of the route passing through Texas, officials said on Tuesday.

The Army Corps of Engineers told TransCanada, which wants to build a 1,700-mile pipeline to carry heavy crude from Alberta to the Gulf Coast, it could begin construction on the portion of the proposed pipeline that would end at the gulf port of Nederland, Texas. The Corps of Engineers is still reviewing permits for a section of the pipeline beginning at a major oil depot in Cushing, Okla., and linking up with the final leg ending at the Gulf.

TransCanada said it welcomed the permits and was awaiting approvals from the two other Corps of Engineers districts that must rule on the remaining 400 miles of pipeline route beginning in Cushing.

"We continue to believe we will be in a position to begin construction later this summer and are working with the Corps and others to secure the approvals and permits we require,” the company said in a statement. "Once the Gulf Coast project is completed, it will help move both Canadian and American oil to refineries on the Gulf Coast, where it is critically needed.”

"It will help push out oil from OPEC nations or conflict regions and replace it with safe, secure and reliable access to Canadian and American oil,” it added. "It will help remove the bottleneck that currently exists in Cushing, which is impacting American producers.”

Click here for more information.



Today's Links

Arctic Approval ‘Probable’ for Shell

Sunoco Plans Reversal of West Texas Crude Pipeline

Italy Lifts Ban for Certain Offshore Drilling Projects

Expanded Oil Drilling Helps U.S.Wean Itself From Mideast


Earl's Pearl of the Day:
"Few things are impossible to diligence and skill. Great works are performed not by strength, but perseverance.” — Samuel Johnson



June 26, 2012

U.S. to Move Forward With ‘Priority’ Arctic O&G Lease Sales

The United States is going to push forward with Arctic oil and gas lease sales in the Beaufort Sea and the Chukchi Sea, said U.S. Secretary of the Interior Ken Salazar.

"Opening up and developing our domestic resources is a priority for us,” Secretary Salazar announced at a conference about Arctic oil and gas drilling held in central Norway.

Opening up more U.S. Arctic areas for drilling could further increase the country’s already rising domestic oil and gas production, reducing dependence on foreign imports.

"A few years ago, when I was a U.S. senator, we were speaking at the time about [liquefied natural gas] terminals and importing LNG to the United States,” Salazar said. "Now the conversation I hear from the industry is the potential for excess natural gas in the United States. So things have changed dramatically in five years.”

The secretary said the U.S. government will release its 2012-2017 program in the coming days, providing details and maps and outlining the next steps for potential energy exploration in the U.S. Arctic.

"There will be lease sales scheduled in both the Chukchi [Sea] and the Beaufort [Sea],” Salazar said. "We are also doing it in a very targeted way, so the 30-mile buffer which now exists in both the Chukchi and the Beaufort will continue.”

An area in the Chukchi Sea, which is of especially high value to the people [there], won’t be up for sale, he said, adding the lease sales will be held in 2016 and 2017.

U.S. crude oil production is expected to rise from 5.5 million bpd in 2010 to 6.7 million bpd in 2020, and the country is expected to become a net exporter of LNG in 2016 and an overall net exporter of natural gas in 2021, according to the "Annual Energy Outlook” for 2012 by the U.S. Energy Information Administration.

Click here for more information.



Today's Links

Shell Tests Arctic Capping Stack for Feds

Tennessee Gas Pipeline Plans to Crack New England Market

Shale Oil Gamble Has EOG Sitting Pretty

As Storm Tracks Away, Workers Go Back Offshore


Earl’s Pearl of the Day:"A wise man can see more from the bottom of a well than a fool can from a mountain top.” — Unknown



June 25, 2012

Coast Guard Girds for Heavier Traffic in the Arctic

The Coast Guard is bolstering its armada of ships, planes and people in Alaska in anticipation of Shell’s planned oil drilling this summer and a surge of other commercial traffic.

But the service is combating a dearth of resources, including vessels capable of plowing through multiyear ice in the region. The Coast Guard has only one icebreaker in service, and that ship will spend its summer far from Shell’s planned oil exploration on a scientific research mission. And though the Coast Guard is bringing its 36-year-old Polar Star heavy icebreaker back into operation, that won’t happen until 2013.

"We’ve got zero capability to respond in the Arctic right now,” Coast Guard Commandant Adm. Robert Papp warned Congress a year ago. "An oil spill, a collision, a ship sinking in the Arctic keeps me awake at night because we have nothing to respond or, if we respond, it’s going to take us weeks to get there.”
Still, the Coast Guard is preparing to stretch its resources so it can keep flights in the air and boats on the sea along Alaska’s many thousands of miles of coastline this summer.

As part of its "Arctic Shield” deployment plan, the Coast Guard expects to patrol the area with cutters from Alameda, Calif., and Kodiak, Alaska, and buoy tenders borrowed from other regions. The service also is stationing about two dozen people, two helicopters and a communications trailer in Barrow, Alaska’s northernmost point, roughly between Shell’s planned operations.

The nearest Coast Guard station is in Dutch Harbor, 1,000 miles south of Shell’s planned drilling. One challenge for the service is beefing up the ability to respond to accidents in the northern part of the state without weakening readiness in southern Alaska waters.

"Leadership throughout the Coast Guard has recognized that,” said Capt. Gregory Saniel, chief of staff for the Coast Guard’s Alaska-based 17th district. "We are getting additional cutter days allocated to us, and aircraft.”

A major concern is an oil spill or other accident tied to Shell’s planned drilling operations in the Chukchi and Beaufort seas.

In partnership with federal drilling regulators and the Defense Department, the Coast Guard is planning to conduct an oil spill response drill to test its readiness and the effectiveness of its equipment for dealing with floating crude in the Arctic.

Click here for more information.



Today's Links

Shell Gears Up for New Arctic Quest

PUC Eases Sale of Philly Refinery to Delta

Saudi Aramco Said to Form Venture Firm on Drilling Tech

Tropical Storm Debby Shuts in Oil and Gas Production


Earl’s Pearl of the Day:"Get happiness out of your work or you may never know what happiness is.” — Elbert Hubbard




June 22, 2012

Statoil: Natural Gas to be Fuel of the Future

Natural gas will be a "fuel of the future,” according to the latest edition of Statoil’s "Energy Perspectives” report — the firm’s annual outlook for global economic and energy markets.

"Energy Perspectives 2012,” released Thursday, estimates global energy demand is set to increase by more than 40 percent between now and 2040. And it suggests energy demand for fossil fuels will account for the majority of the increase, although nuclear and renewable energy is expected to grow at a faster rate.

"Our assessment suggests global growth will continue at an average of 2.8 percent per year over the coming three decades. This is close to the average of the previous 30 years, even though we expect a gradual slowdown in growth toward 2040,” said Statoil Chief Economist Klaus Mohn.

While global oil demand is expected to reach a plateau by 2030, a key prediction of the report is natural gas will take over and become a "fuel of the future.”

"Global gas demand is projected to increase by 60 percent by 2040. Positive drivers include significant new available supply at moderate costs and environmental policies,” said Statoil’s Chief Nnalyst Eirik Węrness.

Statoil expects that natural gas will serve as an important and cost-efficient means to meet the challenge of global warming due to it being the cleanest fossil fuel.

Click here for more information.



Today's Links

Enterprise’s New PDH Project Could Yield 2,000 Jobs

House Passes Domestic Energy and Jobs Act

Plaintiff Steering Committee travels Gulf region to explain BP settlement

Delta Gets Approval for Pipeline Transfer



Earl’s Pearl of the Day:"Reading is to the mind what exercise is to the body.” — Sir Richard Steele



June 21, 2012

Oil Lease Sale Draws $1.7 Billion in Winning Bids

The first oil and gas lease auction for the central Gulf of Mexico since the Deepwater Horizon spill collected $1.7 billion from energy companies, Interior Secretary Ken Salazar announced.

The auction attracted winning bids from Royal Dutch Shell PLC, BP PLC and Statoil ASA, among others, showing the industry’s eagerness to explore in the offshore area after months of squabbling with the United States over strengthened drilling rules.

Still, analysts with Simmons & Co. International characterized the sale as "less than robust,” noting just 6 percent of the tracts available for lease received bids. That compared with 7 percent in a 2010 central Gulf lease sale, and an average of 9 percent over the previous five central Gulf sales.

If fully developed, the U.S. government estimates the leases for sale could result in the production of up to 1.6 billion barrels of oil and 6 trillion cubic feet of natural gas.

Salazar said the interest is "proof positive” the oil and gas industry is confident it can meet new drilling rules put in place following the 2010 accident.

The total raised by the winning bids was the fourth largest for a lease sale in the central Gulf, which includes the waters off the coast of Louisiana, Mississippi and western Alabama.

It was just the second lease sale in the Gulf of Mexico overall since the Deepwater Horizon accident; the prior one last December in the less developed western Gulf raised $337 million.

Statoil offered the highest single bid, $157 million, for a block in the Mississippi Canyon area, the largest single bid since 1983. Shell made the highest sum of winning bids, $406.5 million. In all, 56 companies made 593 bids on 454 locations. There were 7,250 tracts up for lease, comprising 39 million acres.

After making the upfront payment to win the leases, the companies later make royalty payments to the government based on oil and gas they produce from the tracts.

Click here for more information.



Today's Links

Another Petrochemical Plant Planned for Gulf Coast

Alaska’s Oil Pipeline Marks 35-Year Milestone

Chesapeake Appoints New Chairman, Directors

Brookhaven: Overfed Algae Produce More Oil for Biofuels


Earl’s Pearl of the Day:"Never promise more than you can perform.” — Publilius Syrus


June 20, 2012

Gulf Drilling Auction Expected to Net High Bids

Federal officials will unseal nearly 600 secret bids for offshore oil and gas leases today during the first auction of drilling rights in the central Gulf of Mexico since the Deepwater Horizon disaster.

Industry officials are expecting a robust sale driven by pent-up demand for the acreage, big central Gulf discoveries recently and high oil prices earlier this year.

"You see a lot of companies that believe the offshore Gulf of Mexico is going to be in the future a strong investment area in terms of the ability to develop and the availability of resources,” said Erik Milito, the American Petroleum Institute’s upstream director. "You’ve seen a lot of announcements and discussion about rigs coming into the Gulf.”

National Ocean Industries Association President Randall Luthi said uncertainty about the next sale of leases in the region also could spur some bidding.

"If you consider a few big discoveries in the central Gulf over the past few years, such as Chevron’s Hadrian discovery and BP’s Tibor and Kaskida discoveries in deepwater and McMoran’s Davey Jones discovery in shallow water, there may be heavy interest in both deep-water and shallow-water blocks,” Luthi predicted.

During the auction, taking place at the Mercedes-Benz Superdome in New Orleans, the Interior Department’s Bureau of Ocean Management will open 593 offers from 48 companies bidding on 454 tracts in the Gulf.

The acreage on the auction block includes areas ranging from three to 230 miles offshore, with water depths up to roughly 11,115 feet. Some of the tracts up for grabs are located near the site of the failed BP well that blew out in 2010, triggering a lethal explosion on the Deepwater Horizon drilling rig and the nation’s worst oil spill.

The last central Gulf sale took place just a month before that disaster and brought in $949.3 million in high bids.

Click here for more information.



Today's Links

Seaway Pipeline Expansion on Track For 2013 – Operators

GE Introduces Technology to Make Carbon Capture Affordable

Chevron Joins Kosmos Energy in Offshore Suriname Exploration

US-based Far East Wins Right to Continue Exploring Laochang Block

Earl’s Pearl of the Day:"Do not let what you cannot do interfere with what you can do.” — John Wooden




June 19, 2012

Gulf Coast Refiners Will Stop Light, Sweet Crude Imports

Valero could stop importing light, sweet crude to its Gulf Coast refineries as soon as 2013 and fully rely on U.S. production, Chief Executive Officer Bill Klesse announced.

With the rapid growth of domestic oil, Valero has projected Gulf Coast refiners will soon run without foreign imports of light, sweet crude.

"The amount of production coming on is huge,"¯ Klesse said. "They really are going to push out imports."

Federal data shows crude imports to the Gulf Coast have been gradually falling since about 2004. The region imported about 4.9 million barrels of crude per day in 2011, compared to 5.9 million barrels per day a decade earlier.

Crude production has been surging in West Texas, North Dakota and other U.S. regions as technology advances have given producers access to difficult-to-reach reserves. The rapidly growing domestic oil supply has moderate prices in the United States as the world crude price rose above $100 per barrel.

"The United States is an extremely competitive place to produce," Klesse said. "This is a huge opportunity for U.S. refining."¯

Click here for more information.


Today's Links

U.S. State Department to Look Into New Keystone XL Route

USGS Releases New Estimates for Global O&G Reserves

Exxon Ends Drilling for Poland Shale Gas

BLM Greenlights Gasco's Uinta Basin Drilling Plans


Earl's Pearl of the Day:"Wealth consists not in having great possessions, but in having few wants.” — Epicurus



June 18, 2012

Devon Developing Long-Term Work Plan for Oil Sands

Oklahoma City-based Devon Energy Corp. is developing a 10-year plan to ensure it has enough workers for its operations in Canada's oil sands.

The company is pumping about 50,000 barrels per day at two facilities in Alberta, Canada, and is building a third. It also is jointly developing another site with BP.

Kelly Hansen, operations manager at Devon's Jackfish 2 site, said the company has attracted workers from across Alberta but also has pulled in labor from more distant areas, including British Columbia, Canada, and Reno, Nev.

"The (labor) markets are essentially tapped out so we need to essentially reach out farther and wider to get quality people," Hansen said.

Devon and other companies have at times struggled to find workers to staff their operations in areas that haven't traditionally been home to oil and natural gas development.

Susan Matthews, recruiting and retention director for SandRidge Energy Inc., said the company has had to look afar to recruit workers as it develops its acreage in parts of the Mississippian oil play, which extends from northern Oklahoma into southern Kansas.

SandRidge has 25 rigs operating in the Mississippian play.

Click here for more information.


Today's Links

Exxon, Rosneft Agree to Develop Tight Oil Reserves

Canada Seeks Alternatives to Transport Oil Reserves

Oil Executive: 'Very Stressed Relationship' Between Industry, Obama White House

America, Start Your Natural-Gas Engines


Earl's Pearl of the Day:
"It' not the will to win that matters ... everyone has that. It's the will to prepare to win that matters." —Paul "Bear" Bryant



June 15, 2012

BSEE to Pay Extra Cost for Inspectors On Board Shell's Alaska Rigs

The Bureau of Safety and Environmental Enforcement (BSEE) will pay the extra cost to have inspectors on board the Kulluk and Noble Discovery drilling rigs, which Shell has proposed to use for its offshore Alaska drilling plans this summer, 24 hours a day, seven days a week to ensure safety.

Having inspectors on board around the clock is a bit unique but has been done in the Arctic in the 1980s and 1990s when drilling activity previously took place in the Arctic area. Because of difficulties in transporting inspectors to and from the rigs, the inspectors will stay on board for two to three weeks at a time.

While the agency has had support from Congress and the Obama Administration in this particular fiscal year, BSEE Director James Watson said funding for something like this could be hard to get.

"We see it as an opportunity to gather knowledge and will provide a really good experience for the inspectors that are deployed," Watson said, noting the drilling season for offshore Alaska is fairly short.

BSEE has an excellent relationship with the U.S. Coast Guard, Watson said, adding the Coast Guard district commander in Seattle has been very involved in the inspections.

The Coast Guard's district in Juneau, Alaska, has also made an extra effort to prepare for any type of environmental incident with 200 people trained and ready to respond to a near-shore oil spill.

Inspectors have been aboard both the Kulluk and the Noble Discovery but have not yet made any decisions on the drilling permits.

Click here for more information.


Today's Links

ConocoPhillips Restarts LNG Exports from Alaska

EPA Extends Reporting Deadline for Screening Program

Enbridge Applauds Ontario's Political Parties for Safer Digging Legislation

Q&A: Author Talks Challenges, Comprises for Shell in Arctic


Earl's Pearl of the Day:"If you want to be respected, you must respect yourself." — Spanish Proverb



June 14, 2012

Shale Boom to Fuel 1.5 Million Jobs by 2015, Study Says

The shale gas boom will account for nearly 1.5 million new jobs by 2015, employing hundreds of thousands of workers across 48 states even though some companies are cutting back on production, according to a study released Wednesday.

According to the report by research and analysis firm IHS Global Insight, soaring investment in unconventional gas production accounted for 1 million jobs in 2010 and will continue to have an effect on the national economy, contributing $197 billion to annual U.S. gross domestic product by 2015. That total will increase to $332 billion by 2035.

Job growth related to unconventional gas production, in both producing and non-producing states, will increase to 2.4 million by 2035, according to the research.

The independent study was commissioned by the industry-backed America's Natural Gas Alliance and is part of a series on unconventional gas developed from shale, coal-bed methane and tight sands by IHS Global Insight, which is based in Englewood, Colo.

Roger Ihne, principal energy portfolio leader for research firm Deloitte, which was not affiliated with the study, said while the United States now has an oversupply of natural gas, which has forced major producers to cut back on their operations, gas has a strong outlook for continued investment and job growth.

"I think clearly there's been a fundamental shift as a result of natural gas and specifically shale gas in the United States and it has really helped to fuel a boom," said Ihne, who said the IHS study seemed on track with other analyses.

Nearly $3.2 trillion in cumulative investments in unconventional gas development are expected to fuel the economic growth related to the industry from 2010 to 2035, according to the study.

"At a time when the U.S. economy is slowly recovering from the Great Recession and struggling to create enough jobs to sharply reduce the unemployment rate, the growth in shale and other unconventional natural gas production is a major contributor to employment prospects and the U.S. economy," IHS Vice President John Larson, the lead author of the study, said in a statement.

Larson said the study took into account cutbacks on natural gas production spending because of its surplus. Major producers of domestic natural gas have had to shift away from the capital-intensive process of producing gas from unconventional sources like shale because of low natural gas prices.

Click here for more information.


Today's Links

Interior Lays Groundwork to Approve Shell's Arctic Drilling Plan

Exxon Mobil says it is Developing Point Thomson

Apache: US Oil to Lead Company's Production Growth

Minnesota Corn Growers Say Ethanol is Fueling Rural Economies


Earl's Pearl of the Day:"Success is never final; failure is never fatal. It's courage that counts." — John Wooden



June 13, 2012

Cheniere Energy Makes $167 Million Funding Move Toward Gas Facility

Cheniere Energy Inc. made an initial purchase of $167 million — or about a third — of the $500 million of Class B units it agreed to acquire from Cheniere Energy Partners LP to help move ahead plans for a natural gas export facility in Louisiana.

Cheniere Energy said it purchased 11.1 million of the approximately 33.3 million Class B units covered in the agreement. Part of the proceeds will be used to issue a limited notice to proceed to construction company Bechtel Corp. for the Sabine Pass export terminal.

The limited notice will allow Bechtel to proceed with site preparation and continue with engineering and procurement activities. Cheniere expects a full notice to proceed will be issued when other recent funding moves are completed.

Cheniere in late April received federal approval to construct what would be the first major natural gas export facility in the lower United States. Cheniere is aiming to take advantage of a natural gas glut in the United States and higher prices for the commodity abroad.

Click here for more information.



Today's Links

BP Starts Galapagos Oil, Gas Project in Gulf

LyondellBasell Wins Federal Grant for Houston Project

Want to Gain a Foothold in the Land of Milk, Honey and Now Oil and Gas?

Cyber attacks on power grid could be costly and possible



Earl's Pearl of the Day:
"A man who dares to waste one hour of time has not discovered the value of life." — Charles Darwin



June 12, 2012

Haley, Graham, Duncan Promote Offshore Drilling

Three top South Carolina Republicans came together Monday to support federal legislation that would allow drilling of gas and oil off South Carolina's coast, arguing the state's need for jobs and income outweigh potential problems.

"There is a risk in everything you do, but the biggest risk is to do nothing," said U.S. Sen. Lindsey Graham. He said his plan would protect the environment and bar drilling in a 10-mile buffer zone off the coast.

The governor and the South Carolina Legislature would determine whether oil and gas exploration could occur within the next 10-to-50 mile stretch, while all areas 50 to 100 miles offshore would be open to drilling leases, Graham said.

Gov. Nikki Haley and U.S. Rep. Jeff Duncan joined Graham at a news conference, where all said they hope the legislation in the U.S. Senate would lead the nation to energy independence and bring thousands of jobs and millions of dollars in revenue to state and federal coffers.

"Offshore drilling is where we need to be," said Haley. "This will bring so many more jobs."

Haley said those who might protest against such drilling have valid concerns, but, she added, "We're not compromising tourism to do this."

Duncan said he plans to introduce similar legislation in the House. "This legislation will help our state lead the way in energy innovation," the congressman said.

Click here for more information.


Today's Links

Occidental, Magellan Consider Permian-Gulf Pipeline

Shell Races Apache to Exporting LNG From Canada to Asia

Anadarko Makes Another Significant Discovery Offshore Mozambique

BP Denied Access to 21 Government Deepwater Horizon Documents


Earl's Pearl of the Day:"Tact is the knack of making a point without making an enemy." — Sir Isaac Newton



June 11, 2012

Phillips 66 CEO Says Decision on Louisiana Refinery Will Come in Summer

Phillips 66 may decide to keep in its portfolio a refinery in Louisiana it has been trying to sell since December, CEO Greg Garland announced.

Such a decision would be an exception in the atmosphere of refineries trying to sell assets. Phillips 66 and other refiners are rearranging their geographic footprint during a boom in U.S. oil and natural gas production that has caused inland refineries to thrive while those on the coast have had profit margins decline.

Phillips 66 has considered a sale of its 247,000 bpd Alliance refinery in Belle Chasse, La.. since December, but is rethinking the prospect while prices are falling for Light Louisiana Sweet (LLS), Garland said.

"Our view of that refinery has increased," Garland said during an investor conference. "We think LLS will become an advantaged crude." Phillips will reach a decision on whether to sell the refinery by late summer, Garland added.

Phillips 66 would keep investments in its refining assets to a minimum, instead focusing on expanding its chemical and logistics business, Garland said. The Houston company will spend $2 billion on capital projects in its midstream logistics segment, including natural gas liquids processing and exports infrastructure, Garland said.

Click here for more information.


Today's Links

Eagle Ford Oil Pipeline Due July Start-up

New Zealand Releases 23 New Blocks for Tender

Shell Recruits Train for Arctic Oil Spill

UH Subsea Engineering Certificate Offers Mix of Real World, Theory



Earl's Pearl of the Day:"A wise man makes his own decisions, an ignorant man follows the public opinion." — Chinese Proverb


June 7, 2012

Seaway Pipeline Makes First Delivery of Crude Oil to Texas Gulf Coast

Enterprise Products Partners LP and Enbridge Inc. said the Seaway Pipeline made its first delivery of crude from Oklahoma to the U.S. Gulf Coast, providing some long-awaited relief to the mid-continent's glut of crude oil.

The pipeline, which began operating May 19, is pumping 150,000 barrels a day from Cushing, Okla., to Freeport, Texas, the first south-bound route for the rapidly expanding production of crude from the U.S. interior toward the heart of the refining industry, in the Texas and Louisiana Gulf Coast.

The companies are working to expand the pipeline's capacity to 400,000 barrels a day by the first quarter of 2013.

Click here for more information.


Today's Links

Study Predicts Job Growth if BP Fines Used for Gulf Coast

Company Demonstrates Offshore Rig Simulator

Report: U.S. Oil Boom Challenging Canadian Exports

Musings: NOAA Hedges About Storm Season Ahead; Others Agree


Earl's Pearl of the Day:"Work saves us from three great evils: boredom, vice and need." — Voltaire



June 6, 2012