Energy

Egypt expects 520 new exploratory oil wells in 2010

Egypt expects 520 exploratory and development wells for oil and 36 for natural gas to be drilled in 2010, Minister of Petroleum Sameh Fahmy said. The oil wells will cost US$2 billion, while the gas wells, to be drilled in the Nile Delta and offshore in the Mediterranean, will cost more than US$1 billion, he added. Ministry spokesman Hamdi Abdel-Aziz confirmed the remarks. The drilling would be in concession areas awarded by state-owned Egyptian General Petroleum Corporation, Abdel-Aziz added. Egypt's proven natural gas reserves rose 1.1 trillion cubic feet to about 77.2 trillion cubic feet in the year to June 30, while crude oil and condensates reserves rose 220 million barrels to 4.4 billion barrels, the oil ministry said in July.

Kuwait Gulf Oil Co to pour US$1.1bn in oil, gas projects next year

Kuwait Gulf Oil Company (KGOC) will spend US$1.14 billion (EUR 790m) on oil and gas projects in 2010, managing director Bader Al-Khashti said. As part of its five-year plan to 2013, KGOC is to pour US$4.3 billion into capital and operating projects. Al-Khashti had said earlier the company would invest US$11 billion over the next 20 years in a bid to reach a daily output of 900,000 barrels of oil from a production area it operates together with Saudi Arabia.

Saudi Arabia gets two bids for Jizan refinery-sources

Top oil exporter Saudi Arabia has received two bids from four Saudi-owned firms to build, own and operate a new export-oriented refinery in Jizan, industry sources said. Earlier this month, Saudi oil minister Ali al-Naimi said he expected the winning bid to be announced by the end of the year. The tender for Jizan has been delayed several times, after initial plans to open bidding in the second quarter of 2007. Saudi industrial group Tasnee teamed up with Saudi Nama Chemicals Group and Saudi Advanced Refineries and Petrochemicals Co (ARPC) to form a consortium, two sources said. Corral Petroleum Holdings AB, Swedish-registered and owned by Saudi billionaire Mohammed al-Amoudi, also bid for the project, the sources said adding that they were not aware of any further bidders.

Gulf not threatened by Iraq's oil output plans

Energy-rich states of the Gulf Cooperation Council do not feel threatened by Iraq's plans to massively expand its oil production, Kuwait's foreign minister said in December. Iraq has awarded a number of contracts to international oil companies with the aim of boosting its crude production from the current 2.5 million barrels per day to above 10 million bpd during the next several years. "We are not threatened by Iraq's plans to expand its oil production," Sheikh Mohammad al-Sabah, whose country is the current president of the GCC, told a press conference. The six-nation Gulf bloc, which boasts around 45 per cent of proven global crude reserves and as much as a quarter of the world's gas resources, pumps around 15 million bpd, or just under one-fifth of world consumption. Iraq in December awarded oil contracts to foreign giants at an auction it hopes will hike output to 12 million barrels a day and put it on a par with the world's top exporter Arab neighbor Saudi Arabia. Its oil minister, Hussein al-Shahristani, said his country's oil output would reach 12 million bpd within the next six years, up from the current 2.5 million bpd, based on all the contracts it is negotiating.

OPEC pumps up volume on natural gas liquids

While the Organization of Petroleum Exporting Countries has slashed crude oil output by more than 2 million barrels a day since the 2008 third quarter, rising production of so-called natural gas liquids has helped the group reassert its dominance in the world oil market. OPEC output of NGLs, a collection of liquids that are produced in association with crude oil and natural gas, is projected to jump by 800,000 barrels a day in 2010, or double the expected rise in crude oil output from non-OPEC countries, according to the International Energy Agency. OPEC NGLs will meet more than half of the expected 1.4 million barrels a day rise in global oil demand next year, the first gain since 2007. In a desperate effort to shore up prices and cap rising stockpiles in the face of sagging demand, OPEC in September 2008 pledged the first of three moves to limit output by 4.2 million barrels a day. Only about half that level has been cut, but after much turbulence--including a price plunge to into low US$30-a-barrel level for the first time since early 2004-- crude is stabilizing near US$70 a barrel.

Statoil eyes oil fields in Iraq

Norwegian oil major Statoil ASA submitted a bid for oil fields in Iraq, which were auctioned off, spokeswoman Mari Dotterud told the press. Ten fields altogether were auctioned off in Iraq in December. "The offers were presented in an envelope there and then. No bids were sent beforehand. The highest bid will win," Dotterud said. She said that Statoil has a long-term perspective in Iraq and that a potential bid will be submitted in cooperation with partners. The contracts run for 20 years. At the same time, Statoil is closely following the security situation in Iraq, Dotterud said.

Nippon Oil, ADNOC finish deal to store oil in Japan

Nippon Oil Corp, Japan's biggest refiner, said it had reached a final agreement with Abu Dhabi National Oil Co (ADNOC) for the UAE firm to store crude oil to help stock up Japan's national reserves. The agreement calls for ADNOC to store 620,000 kilolitres, about 3.9 million barrels, of crude, which is the roughly the equivalent of a day's worth of oil consumption in Japan, for three years starting from December at a reserve base in Kagoshima in southern Japan. The basic agreement of the deal was announced in June and is expected to help beef up Japan's energy security by tapping the supply from ADNOC in times of shortages.

Saudi poised to become global petrochem hub

Saudi Arabia is set to become the global center of petrochemicals production with no less than 30 new plants scheduled for completion in 2010 - including mega-projects in Al Jubail and Yanbu - and another 40 in the planning phase. The other large-scale units are on stream or starting up in Qatar, Kuwait, Oman and Abu Dhabi, and an estimated investment of around $170 billion is envisaged by 2015, said Dr Abdulwahab Al-Sadoun, Gulf Petrochemicals and Chemicals Association (GPCA) secretary general. The shift of petrochemical industry's center of gravity to the feedstock-rich Middle East, Dr Al-Sadoun said, is occurring more swiftly than anticipated, as plant after plant comes on-stream in the region, and production falters elsewhere in the world under the recession. By 2015, the region will supply one third of the world's ethylene glycol, used in fibers and anti-freeze; 20 per cent of global polyethylene and 13 per cent of higher-value polypropylene, according to Chemical Week, co-organizer of the Fourth Annual GPCA Forum.

Oil minister: Iraq eager to buy Iran's gas

The comment by the Iranian oil minister came in a meeting with Iraqi Electricity Minister Karim Wahid al-Hassan in Tehran. He said Iraq's electricity installations have been seriously damaged after the toppling of the Saddam Hussein regime and it has fallen behind in terms of producing electricity. Mirkazemi further announced that Iran is going to export fuels to Iraq in participation of the private sector in the near future. During the meeting, Wahid voiced the Iraqi government's willingness to expand ties with Iran in the field of energy.

Saudi boosts oil supply to Asian buyers

Top world oil exporter Saudi Arabia is restoring full supplies to at least two Asian buyers in January and holding contracted volumes to seven others steady, industry sources said. The two Asian customers will get full contract volumes in January after cuts of five to seven per cent this month, sources at the firms said. Still, officials at two European refineries and a global firm said supply would be steady. "We expected to get full contracted volumes this time," said a trader with an Asian refiner, which received a boost in supplies after cuts of 5pc to 6pc this month. Asia takes about half of Saudi exports and demand there has been more robust than in Europe. The increase in supply to Asia comes as oil is trading at US$71 a barrel, within sight of Saudi Arabia's preferred level of US$75.

Qatari emir wants gas prices tied to oil

Qatar's ruler urged natural gas producers to work toward inking gas prices with those of oil, voicing worries that crude's rally this year has not been mirrored in gas markets. Sheikh Hamad bin Khalifa Al Thani's comments came at the start of the one day meeting of the Gas Exporting Countries Forum _ a group of 11 nations dubbed by some as the Gas OPEC whose members include gas heavyweights like Qatar, Iran and Russia. The Qatari emir, whose tiny Persian Gulf nation sits atop the world's largest proven reserves of natural gas, said while oil prices have rebounded from their precipitous drop late last year, natural gas prices have not. The "rise in the price of crude was not matched by a similar rise in gas prices," he said. "I hope this situation will be temporary," he said urging the group to "analyze the reasons which led to this discrepancy between the two prices, and work to establish a link between the prices of gas and prices of oil, to achieve a balance."

Gas group elects Russia's Bokhanovsky as secretary general

The Russian candidate selected in December as secretary-general of the GECF group of gas producers is Leonid Bokhanovsky, vice-president of engineering and construction group Stroytransgaz, Russia's Energy Ministry said. "It's Bokhanovsky," a spokesman for the ministry said. The Gas Exporting Countries Forum is a grouping of 11 gas-producing countries. Russia is the world's biggest producer and exporter of natural gas.

Qatargas 4 LNG project delayed

Royal Dutch Shell said it had delayed one of its largest schemes by around a year with start-up for the US$8 billion Qatargas 4 liquefied natural gas project now planned for late 2010 and the first cargo possibly pushed into 2011. The delay, which a Shell spokeswoman said was due to contractors struggling to keep up with the pace of developments in Qatar's gas industry, will make it harder for the Anglo-Dutch oil major to turn around a long run of falling production. "We had been planning for a start-up in early 2010 but now we expect that to come in late 2010," the spokeswoman said, adding the slippage represented a delay of 10 months. She declined to say when first cargoes would load but a statement from the company said ramp-up of the project could continue into 2011, raising the prospect the facility may not be in a position to load ships until then. One dealer said they were not surprised by the delay, as Shell had flagged problems to analysts in recent weeks. Further delays are possible, with industry analysts at Waterborne LNG saying they expect first cargoes in mid 2011.