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Sinopec Group Starts Building Natural Gas Pipeline in Brazil
June 12 (Bloomberg) -- China Petrochemical Corp., Asia's largest refiner, started the construction of a natural gas pipeline in Brazil on June 10 to meet rising demand in the South American nation.
China Petrochemical, parent of overseas-listed China Petroleum & Chemical Corp., or Sinopec, will build the 1200- kilometer (746-mile) pipeline within 15 months, according to a statement on the Web site of China's Ministry of Foreign Affairs.
Petroleo Brasileiro SA, Brazil's state-controlled oil company, hired China Petrochemical, or Sinopec Group to build the gas pipeline for $239 million, the company said in a statement to the Sao Paolo stock exchange on April 17.
The pipeline is part of a $6.5 billion investment plan by Petrobras to build pipelines linking the country's northeast and southeast to ease future gas shortage in the country.
Global Petroleum Show June 13 - 15, 2006
Calgary, Canada
Addax and Sinopec are participating.
http://www.petroleumshow.com/
Sinopec mentioned - A Bidding Frenzy on Angola's Oil
JUNE 7, 2006
Europe
By Stanley Reed
A Bidding Frenzy for Angola's Oil
Record bids for drilling rights demonstrate the big bets oil companies are making to secure reserves of black gold
Just how wild is the bidding for good oil acreage these days? Very wild, going by a recent auction of acreage in the Congo Basin, off the coast of Angola. To land the licenses needed to explore three deepwater exploration tracts, oil companies offered to pay an astronomical $3.1 billion in signing bonuses, plus another $240 million in commitments for social projects in the impoverished African country. Advertisement
All the more remarkable, the bidding was for tracts that had already been "cherry picked" by other international oil companies. These bids were "the highest ever offered for exploration acreage anywhere in the world," says Catriona O'Rourke, an analyst at Edinburgh consultants Wood Mackenzie, which has published an analysis of data provided by the Angolans.
The Angola episode shows how governments and companies are adjusting to the new high-price oil environment. Governments are trying to recoup a bigger chunk of the money, while companies -- many of them hungry for crude -- are bidding properties up to unseen levels. These dynamics are eventually likely to squeeze the current high returns that companies are earning. Meanwhile, some of the big players such as ExxonMobil (XOM) and BP (BP) are playing a waiting game and staying out of some of the hottest auctions.
GUSHERS. The most lavish bidder in the Angola round was a consortium led by China's Sinopec (SNP), which is desperately trying to line up oil and gas reserves. It bid a combined $2.2 billion for Blocks 17 and 18. Italy's ENI (E) also put in a $902 million offer for Block 15. O'Rourke of Wood Mackenzie says these areas were "prime acreage," and high bids were expected. Even so, few expected the action to exceed $1 billion. How the projects will actually go forward hasn't yet been fully worked out, and talks between Sonangol, the Angolan national oil company, and the bidders are still under way.
Angola has been one of the great success stories in the oil business recently, and the values of Angolan tracts have risen enormously. Oil companies won exploration rights for these three blocks in the early 1990s for bonuses in the range of $6 million to $35 million.
Some excellent discoveries were made there. They include Total's (TOT) Girrassol project in Block 17, which produces 240,000 barrels per day. Because of this stellar track record, later Angolan acreage next to these blocks went for as high as $350 million. Now, Angola, which has a relatively generous though toughening tax regime for oil production, is taking advantage of high prices and the scarcity of good opportunities to maximize its short-term revenue.
The lesson that may be learned from this round, Wood Mackenzie notes, is that companies are willing to pay very large bonuses to governments offering decent production terms. Another lesson: Governments may start looking for higher upfront payments.
TENANTS' RIGHTS. In the Angolan case, the numbers could turn ugly. Having made such huge initial payments before even finding oil -- let alone producing it -- the oil companies will find it tough to secure the 20% or so rate of return they ordinarily seek for projects that involve considerable risk. In a study, Deutsche Bank (DB) reckons the new "winners" will have to make finds in the range of a billion barrels -- a very large discovery -- to make good money.
While not impossible, what works against the likelihood of massive finds is that companies including ExxonMobil and BP have already worked over each of the blocks, presumably drilling what they thought were the best prospects. ExxonMobil, for instance, has already found 3.3 billion barrels of reserves in Block 15, making 17 discoveries with 19 wells. As a result, Deutsche Bank reckons that 12% returns -- more typical of refining and marketing than exploration and production -- would be a "high-side case" for the ENI-led group with the new license. Much lower returns are possible.
The companies that have already found reserves in the blocks retain the rights to the oil and gas that they have found, while the new consortia will work in other parts of these massive offshore zones. In Blocks 15 and 18, ExxonMobil and BP, the operators of existing projects in these areas, bid only $120 million and $15 million respectively in the new round. BP's low bid came on the same block for which a Sinopec-led group offered $1.2 billion.
ExxonMobil and BP already have a lot on their plates in Angola, and, apparently, they figure they're better off waiting until better opportunities emerge. No matter: Other companies seem more than willing to bid sky high.
Reed is London bureau chief for BusinessWeek
Oil firms open wallets for reserves access
Sunday, June 11, 2006
LONDON: Oil firms are paying millions of dollars more to governments to get access to oil and gas fields, a further sign that record oil prices are shifting the balance of power towards owners of reserves.
Competition for resources is driving up “signature bonuses” companies pay up front for access to fields, particularly in West Africa, making firms more dependent on oil prices staying higher for longer and squeezing returns.
“There are a number of places where you can see signature bonuses increasing quite a bit,” Tom Hickey, chief financial officer of UK-listed Tullow Oil Plc told Reuters. “For sure, it certainly means that even at current oil prices, discoveries will need to be quite sizeable.”
The increase in bonuses comes as oil-producing countries from Venezuela to Russia seek more cash and control from multinationals that drill in their oil and gas fields, a trend dubbed “resource nationalism” by some analysts.
China’s state-owned Sinopec last month won a 40 percent stake in an area off the coast of Angola, Block 18, after proposing a record-breaking $1.1 billion government signature bonus.
Bonuses for the top three blocks reached more than $3.1 billion, Deutsche Bank said, a jump from the $6 million to $35 million Total and others paid in the 1990s for access to the areas, all of which have seen huge oil finds. “The companies have far exceeded bonuses seen anywhere else,” Deutsche analyst Paul Sankey said in a note. “For major oils, returns are under fundamental pressure.”
Restraint to the winds? The top three blocks offered by Angola 15, 17 and 18 according to Deutsche are now home to fields such as Total’s Girassol. The parts on offer were those not developed or planned for development by the original operator.
“They are throwing restraint to the winds,” said Deborah White, analyst at Societe Generale. “It’s not even a full block, it’s part of a block.” The bonuses invite comparisons with the $1.2 billion firms paid for permits covering Mukluk, an area in Alaska found in 1983 to hold no oil and considered the world’s most costly dry well, she said.
Growing global demand, dwindling reserves in regions such as the North Sea and a 4 1/2 year rally in crude prices to a record high of over $75 a barrel in April are driving up bonuses in Angola and Nigeria. Sub-Saharan Africa’s top two producers are both open to foreign investment and offer the chance of large discoveries an increasingly rare combination in 2006.
“There are relatively few places at the moment where you can make very, very, very big discoveries that are open to non-national companies,” Tullow’s Hickey said. “Angola is one of the places.” Tullow, a bidder in the Angolan licensing round, is finalising its position over shallow water Block 1, he said.
Rising bonuses add to pressure on oil companies’ returns already coming from rising taxes in some producers, and higher costs for services such as rigs. Nigeria, Africa’s top oil producer, in May sold 16 oil licences in return for bids totalling $500 million and promises by mostly Asian investors of $20 billion in new infrastructure, in a sale that raised questions about transparency.
Private firms pay more: Facing competition from state-backed companies for reserves, their publicly traded counterparts are also paying more.
In Angola’s Block 17, Sinopec was beaten by France’s Total whose $670 million bonus took a 40 percent stake, leaving Sinopec with 25.5 percent. Italy’s ENI bid $902 million for a stake in Block 15. To get a 15 percent return, Eni will need a huge 800 million barrel find and a real US crude price of $57 a barrel more than double the average in the 1990s, Deutsche Bank estimates. Eni Chief Financial Officer Marco Mangiagalli said in May the company was “quite excited” by the block’s potential, and the huge bonuses suggest the bidders are confident of success at the drill bit. reuters
BB, interesting how companies tied to Mr Brandhuber's experience and association in Amsterdam and London are now popping up in JDZ (Addax and BG Group). Coincidence, hmmmm?
ND9
*******************************************************
Walter F. Brandhuber, President, CEO and Director
Walter Brandhuber served as a senior consultant at CRA International Limited, in London, England, from September, 2005 until his appointment in January 2006 as president and chief executive officer of the Company. He was also a senior consultant with G.E.A.R.S Limited from July 2003. From 1999 to 2003, Mr. Brandhuber served as a managing director and member of the board of Odin Petroleum N.V. based in London, England and Amsterdam, Netherlands
Dadd,
The only item on the agenda that I'm interested in is the Day #2 item at 10:20am (below). However, it's only 30 minutes long, and if I'm reading the website registration correctly, and doing the British Pound coversion properly, it's $1500 USD to get in. That's not "minimal" for me. It's equates to another ~ 3000 shares of ERHE I could purchase. However, I live in Houston area and would be more than happy to go if you want to pay my "minimal" entrance fee:>)
Anybody else in the Houston area going?
ND9
*****************************************************
Keynote Address: clarification on 2005 block awards in Nigeria-São Tomé &
Principe Joint Development Zone
Carlos Gomes
Chairman of the Board
Nigeria-São Tomé & Principe Joint Development Authority
Mrrhodes - clarification on 2005 block awards - I posted this on other board but this is an interesting title for this item, day #2, 10:20am.
ND9
********************************************
Keynote Address: clarification on 2005 block awards in Nigeria-São Tomé &
Principe Joint Development Zone
Carlos Gomes
Chairman of the Board
Nigeria-São Tomé & Principe Joint Development Authority
Sinopec Group to Purchase Beijing Chemicals Company (Update2)
June 9 (Bloomberg) -- China Petrochemical Corp., Asia's biggest refiner, plans to pay 3.3 billion yuan ($412 million) for 83 percent of Beijing Eastern Petrochemical Co., the parent of Shenzhen-listed Beijing Huaer Co.
China Petrochemical's unit Sinopec Beijing Yanshan Chemical Corp. will buy the stake from shareholders China Cinda Asset Management Corp. and China Orient Asset Management Corp., Beijing Huaer said in a statement to the Shenzhen Stock Exchange today. The transaction needs government approval, it said.
China Petrochemical, parent of overseas-listed China Petroleum & Chemical Corp., has no ``specific plans'' to reorganize Beijing Huaer at this time, the company said. Beijing Huaer's net loss widened more than fivefold to 78.9 million yuan in the first quarter from a year earlier as sales dropped, according to its quarterly report.
``It makes sense for China Petrochemical to take over Beijing Huaer to integrate operations,'' said Huang Meilong, an analyst at Shenyin Wanguo Research and Consulting Co. in Shanghai. China Petrochemical's ethylene unit supplies the material to Beijing Huaer to make polyvinyl chloride and other chemical products, he said.
Beijing Huaer's shares rose as much as 10 percent to 6.49 yuan on the Shenzhen exchange. The shares changed hands 6.6 percent lower at 5.51 yuan as of 11:14 a.m. local time. They have doubled this year, while the Shenzhen Composite Index has gained 45 percent.
BB, I was thinking of going but I think the conversion rate is 1 British pound = $1.8 US Dollars....... Is that how much these conferences typically cost?
thanks,
ND9
BB, 850 British Pounds to attend - EOM.
BB "clarification on 2005 block awards in Nigeria and Sao Tome & Principe"......... an interesting title for Day #2, 10:20am topic.
ND9
****************************************
Keynote Address: clarification on 2005 block awards in Nigeria-São Tomé &
Principe Joint Development Zone
Carlos Gomes
Chairman of the Board
Nigeria-São Tomé & Principe Joint Development Authority
Nigeria to Boost Output by 1.5mn BPD by 2007
NNPC: Oil exports from Bonga to fetch $41bn revenue
By Patricia Ubaka with agency reports, 06.06.2006
Minister of State for Petroleum Resources, Dr. Edmund Daukoru has said Nigeria will increase its oil output by 1.5 million barrels per day by next year, contributing to Organisation of Petroleum Exporting Countries' (OPEC's) spare capacity.
The country and its co-partners in the Bonga oil block will also earn estimated revenue of $41 billion (N5.25 trillion) from export of crude oil over the next 20 years life span of the deep offshore field, the Nigerian National Petroleum Corporation (NNPC) disclosed.
Daukoru who is also OPEC's president made the comments after meeting South Korean President Roh Moo-hyun yesterday.
Over the past year Nigeria, according to him, Nigeria has begun pumping oil, Shell's 225,000 bpd Bonga field and ExxonMobil's 150,000 bpd field, with more developments led by Total and Chevron expected to follow over the next two years.
The offshore fields have typically been immune to the kind of militant attacks that have shut in 550,000 bpd of onshore production in the Niger Delta, a quarter of Nigeria's total.
But an unprecedented raid on a rig 40 miles offshore Friday had heightened fears about the safety of more remote facilities when gunmen kidnapped eight foreign workers, who were freed Sunday, in that attack.
OPEC members agreed on Thursday to leave oil output unchanged near its full capacity, news that failed to soothe oil markets as United States crude traded up $1.10 at $73.43 a barrel yesterday, a figure which is within $2 of a record high.
A greater volume of spare capacity could help OPEC stem an over three-year oil price rally, fuelled in part by fears that producers and refiners would be unable to compensate supplies in the case of any sudden, unexpected outages.
Meanwhile, the country and its co-partners in the Bonga oil block will earn estimated revenue of $41 billion (N5.25 trillion) from export of crude oil over the next 20 years life span of the deep offshore field.
Also, the Nigerian National Petroleum Corporation (NNPC) has set for itself, a crude oil production target of 3.0 million barrels per day (bpd) for this year from both joint venture operations and output from fields operated under the production sharing contract (PSC).
The General Manager, PSC/FES of the National Petroleum Investment Mana-gement Services (NAPIMS), Mr. Abiye Membere, disclosed at a Petroleum Roundtable talks in Lagos that oil exports from the Bonga deepwater field would fetch $2 billion annually at average oil price of $60 per barrel and a production rate of 225,000 bpd.
Bonga field, operated by Shell Nigeria Exploration and Production Company (SNEPCO), went into production in November, 2005 and recorded its first shipment of crude last January.
According to the estimates from NAPIMS (the NNPC subsidiaries overseeing Federal Government's investments in oil operations), Shell may be able to recoup the $3.6 billion spent in bringing the field up to production within the next two years, thereby paving way for the Nigerian government to begin to have a share from the profit generated from oil exports from the field.
"Economic impact from the Bonga field include increase revenue from oil and gas production, increase in oil and gas production, increase in Nigeria content, infrastructure and human resources development," said Membere.
The NAPIMS chief said that the Bonga field holds a total recoverable reserves of 1 billion, with 18 wells drilled under the first phase of the field development programme. Another 16 wells, he said, would be drilled in the second phase of the programme, which will commence in the third quarter of 2006.
"The estimated Bonga main development cost is below $6 per barrel," said Membere.
Shell holds 55 percent in the field. Other partners in the field are ExxonMobil, 20 per cent, Agip ad Elf, 12.5 per cent, with the NNPC being the concession owner.
The Bonga field is among the 11 major oil discoveries achieved in the deepwater region between 1996 and 2004, which added more than 7 billion barrels of oil and condensate to the Nigeria's reserve base and about 27 trillion cubic feet of gas.
However, the NNPC has set the target of attaining and sustaining oil production level of 3 million bpd in 2006. Current production level has remained at 2.4 million bpd.
The Managing Director of Nigerian Petroleum Development Company (NPDC), Mr. Smart Fadayomi, who made this known also at the Petroleum Roundtable, said that in line with this production target, the NPDC, which is the upstream arm of the NNPC, has been mandated to raise its production level from 64,000 bpd to 150,000 bpd by 2008.
The company also has the objective to grow its oil reserves base from 350 million barrels to 550 million barrels during the same period, which according to Fadayomi, is line with the overall national objectives of achieving 40 billion barrels of crude reserves by 2010.
Nigeria to Boost Output by 1.5mn BPD by 2007
NNPC: Oil exports from Bonga to fetch $41bn revenue
By Patricia Ubaka with agency reports, 06.06.2006
Minister of State for Petroleum Resources, Dr. Edmund Daukoru has said Nigeria will increase its oil output by 1.5 million barrels per day by next year, contributing to Organisation of Petroleum Exporting Countries' (OPEC's) spare capacity.
The country and its co-partners in the Bonga oil block will also earn estimated revenue of $41 billion (N5.25 trillion) from export of crude oil over the next 20 years life span of the deep offshore field, the Nigerian National Petroleum Corporation (NNPC) disclosed.
Daukoru who is also OPEC's president made the comments after meeting South Korean President Roh Moo-hyun yesterday.
Over the past year Nigeria, according to him, Nigeria has begun pumping oil, Shell's 225,000 bpd Bonga field and ExxonMobil's 150,000 bpd field, with more developments led by Total and Chevron expected to follow over the next two years.
The offshore fields have typically been immune to the kind of militant attacks that have shut in 550,000 bpd of onshore production in the Niger Delta, a quarter of Nigeria's total.
But an unprecedented raid on a rig 40 miles offshore Friday had heightened fears about the safety of more remote facilities when gunmen kidnapped eight foreign workers, who were freed Sunday, in that attack.
OPEC members agreed on Thursday to leave oil output unchanged near its full capacity, news that failed to soothe oil markets as United States crude traded up $1.10 at $73.43 a barrel yesterday, a figure which is within $2 of a record high.
A greater volume of spare capacity could help OPEC stem an over three-year oil price rally, fuelled in part by fears that producers and refiners would be unable to compensate supplies in the case of any sudden, unexpected outages.
Meanwhile, the country and its co-partners in the Bonga oil block will earn estimated revenue of $41 billion (N5.25 trillion) from export of crude oil over the next 20 years life span of the deep offshore field.
Also, the Nigerian National Petroleum Corporation (NNPC) has set for itself, a crude oil production target of 3.0 million barrels per day (bpd) for this year from both joint venture operations and output from fields operated under the production sharing contract (PSC).
The General Manager, PSC/FES of the National Petroleum Investment Mana-gement Services (NAPIMS), Mr. Abiye Membere, disclosed at a Petroleum Roundtable talks in Lagos that oil exports from the Bonga deepwater field would fetch $2 billion annually at average oil price of $60 per barrel and a production rate of 225,000 bpd.
Bonga field, operated by Shell Nigeria Exploration and Production Company (SNEPCO), went into production in November, 2005 and recorded its first shipment of crude last January.
According to the estimates from NAPIMS (the NNPC subsidiaries overseeing Federal Government's investments in oil operations), Shell may be able to recoup the $3.6 billion spent in bringing the field up to production within the next two years, thereby paving way for the Nigerian government to begin to have a share from the profit generated from oil exports from the field.
"Economic impact from the Bonga field include increase revenue from oil and gas production, increase in oil and gas production, increase in Nigeria content, infrastructure and human resources development," said Membere.
The NAPIMS chief said that the Bonga field holds a total recoverable reserves of 1 billion, with 18 wells drilled under the first phase of the field development programme. Another 16 wells, he said, would be drilled in the second phase of the programme, which will commence in the third quarter of 2006.
"The estimated Bonga main development cost is below $6 per barrel," said Membere.
Shell holds 55 percent in the field. Other partners in the field are ExxonMobil, 20 per cent, Agip ad Elf, 12.5 per cent, with the NNPC being the concession owner.
The Bonga field is among the 11 major oil discoveries achieved in the deepwater region between 1996 and 2004, which added more than 7 billion barrels of oil and condensate to the Nigeria's reserve base and about 27 trillion cubic feet of gas.
However, the NNPC has set the target of attaining and sustaining oil production level of 3 million bpd in 2006. Current production level has remained at 2.4 million bpd.
The Managing Director of Nigerian Petroleum Development Company (NPDC), Mr. Smart Fadayomi, who made this known also at the Petroleum Roundtable, said that in line with this production target, the NPDC, which is the upstream arm of the NNPC, has been mandated to raise its production level from 64,000 bpd to 150,000 bpd by 2008.
The company also has the objective to grow its oil reserves base from 350 million barrels to 550 million barrels during the same period, which according to Fadayomi, is line with the overall national objectives of achieving 40 billion barrels of crude reserves by 2010.
BWI service to West Africa takes flight
Baltimore Business Journal - 11:38 AM EDT Monday
North American Airlines Inc. has begun weekly service from Baltimore/Washington International Thurgood Marshall Airport to West Africa.
Executives with World Air Holdings Inc., North American Airlines' parent company, said Monday the carrier is the only U.S. airline offering scheduled service to Africa.
Flights from BWI, which began Sunday, fly nonstop to Banjul, the capital of Gambia, and Accra, Ghana, which borders the Gulf of Guinea between the Ivory Coast and Togo in western Africa.
North American Airlines also flies from New York's John F. Kennedy International Airport to Accra. North American Airlines recently added a weekly flight out between JFK and Accra on Saturdays.
"We are pleased to provide an important link that many customers want between the Baltimore/Washington metropolitan area and West Africa," said World Air Holdings Inc. President Jeff MacKinney in a statement.
The new service gives a boost to BWI's international traffic, which has lagged in recent years as its domestic business has taken off thanks to the presence of dominant discount carrier Southwest Airlines (NYSE: LUV).
Nonrefundable round trip tickets from BWI to Banjul start at $773. The weekly flights are scheduled to leave Baltimore Sunday evenings at 11:55 p.m. and arrive in Banjul on Monday at 12:15 p.m. then land later that day in Accra at 4:30 p.m.
Flights headed to Baltimore will depart Banjul on Sunday at 4:15 p.m. They are scheduled to reach BWI on Sunday at 8:45 p.m.
At a press conference in April announcing the new service, Lt. Gov. Michael Steele said the flights would foster economic opportunities for Maryland in West Africa. More than 200,000 West African natives live in the Baltimore/Washington metro area, Steele said.
The new service will make a $20 million economic impact on the state, officials project.
BWI Executive Director Timothy Campbell said the Maryland Aviation Administration had been working for months to add North American to BWI's roster.
BWI service to West Africa takes flight
Baltimore Business Journal - 11:38 AM EDT Monday
North American Airlines Inc. has begun weekly service from Baltimore/Washington International Thurgood Marshall Airport to West Africa.
Executives with World Air Holdings Inc., North American Airlines' parent company, said Monday the carrier is the only U.S. airline offering scheduled service to Africa.
Flights from BWI, which began Sunday, fly nonstop to Banjul, the capital of Gambia, and Accra, Ghana, which borders the Gulf of Guinea between the Ivory Coast and Togo in western Africa.
North American Airlines also flies from New York's John F. Kennedy International Airport to Accra. North American Airlines recently added a weekly flight out between JFK and Accra on Saturdays.
"We are pleased to provide an important link that many customers want between the Baltimore/Washington metropolitan area and West Africa," said World Air Holdings Inc. President Jeff MacKinney in a statement.
The new service gives a boost to BWI's international traffic, which has lagged in recent years as its domestic business has taken off thanks to the presence of dominant discount carrier Southwest Airlines (NYSE: LUV).
Nonrefundable round trip tickets from BWI to Banjul start at $773. The weekly flights are scheduled to leave Baltimore Sunday evenings at 11:55 p.m. and arrive in Banjul on Monday at 12:15 p.m. then land later that day in Accra at 4:30 p.m.
Flights headed to Baltimore will depart Banjul on Sunday at 4:15 p.m. They are scheduled to reach BWI on Sunday at 8:45 p.m.
At a press conference in April announcing the new service, Lt. Gov. Michael Steele said the flights would foster economic opportunities for Maryland in West Africa. More than 200,000 West African natives live in the Baltimore/Washington metro area, Steele said.
The new service will make a $20 million economic impact on the state, officials project.
BWI Executive Director Timothy Campbell said the Maryland Aviation Administration had been working for months to add North American to BWI's roster.
Nigeria hires US firm to secure oil installations
June 5, 2006, 17 hours, 22 minutes and 47 seconds ago.
By ANDnetwork .com
Nigeria's federal government is making arrangements to employ the services of an American technology giant to install devices that will secure oil installations.
By Ejiofor Alike
The devices will monitor, detect and prevent the frequent vandalisation of oil pipelines and the destruction of oil installations across the country. And oil companies are willing to pay for the modern security system in the form of security tax.
This latest technology from advanced researches by the United States army and navy in collaboration with Philips Petroleum, BP Oil and other American oil companies has already been installed in the United States of America and Mexico to protect oil facilities.
Sources close to the company said that officials of the American company had arrived Nigeria to fine tune the proposals to be submitted to government.
According to the sources, the American company, whose identity could not be disclosed for security reasons, would employ the integrated smart sensors and pipeline management systems which are the first and only one of its kinds in the world.
The technology will control, manage, protect and observe oil and gas production processes, as well as collect information every second for an automatic identification of problem areas for quick action.
According to sources, the technology is also capable of leak detection, threat recognition, intruder detection and prevention, pipeline balance reporting, production reporting and automatic response procedures, adding that it simply combines operations control monitoring with asset monitoring and protection.
The equipment are to be installed in strategic places to enable mobile operators and security agents in vehicles and offices to monitor, detect and recognise events, activities and movement of persons and vehicles within a distance of one kilometre on both sides of an oil installation with the aid of full motion video.
The basic ingredients required for the security of oil wells, production facilities and pipelines are the ability to promptly identify and recognise threats, disruption of service (leaks and breakages) and mount defence against the destruction or theft of the installation, pointing out that the technology is well-structured to meet these challenges.
Oil companies pledge support
On the cost of the project, the company sources said the company was yet to conclude the pilot survey to determine the actual cost of the project, but they said the infra-red cameras which would be installed at every 1km to 5km to cover the network of the 5 000km NNPC pipelines comprising 4 315km of multi-product and 685km of crude oil pipelines, cost between US$3 000 and US$20 000 each depending on the quality and range.
BusinessDay gathered that Chevron, Shell Petroleum Development Company (SPDC) of Nigeria Limited and other oil companies operating in Nigeria had pledged their support for the programme. The Nigerian National Petroleum Corporation (NNPC) and the Department of Petroleum Resources (DPR) have called for the project proposal. The sources hinted that in line with governments policy on local content, the project when completed would be managed by one of Nigeria s leading indigenous oil service company and communication giant.
Commenting on the proposed project, sources at the indigenous company who spoke to BusinessDay on condition of anonymity bemoaned the incessant vandalisation of oil facilities in Nigeria and described the technology as the only panacea to this problem.
Analysts say that the technology will be a landmark development in Nigeria s oil and gas industry as it will curtail the incessant vandalisation of oil pipelines and destruction of oil installations which have led to the loss of several lives and billions of dollars of oil revenue.
The attacks on oil installations, vandalisation of pipelines and kidnapping of oil workers have cut crude oil production by about 550 000 barrels a day, representing more than 20% of the country’s daily production. At an average price of US$73.32 per barrel, the 550 000 barrels a day production disruption translates to a financial loss of US$40 million a day or US$1.2 billion a month.
The loss has also prevented Shell from taking its own share of about 100 000 barrels a day to the international market while the destruction of gas pipelines has reduced the country’s power supply by 850 megawatts. More than 3 000 Nigerians have also lost their lives in pipeline explosions occasioned by the activities of vandals and saboteurs.
BusinessDay Online
Nigeria hires US firm to secure oil installations
June 5, 2006, 17 hours, 22 minutes and 47 seconds ago.
By ANDnetwork .com
Nigeria's federal government is making arrangements to employ the services of an American technology giant to install devices that will secure oil installations.
By Ejiofor Alike
The devices will monitor, detect and prevent the frequent vandalisation of oil pipelines and the destruction of oil installations across the country. And oil companies are willing to pay for the modern security system in the form of security tax.
This latest technology from advanced researches by the United States army and navy in collaboration with Philips Petroleum, BP Oil and other American oil companies has already been installed in the United States of America and Mexico to protect oil facilities.
Sources close to the company said that officials of the American company had arrived Nigeria to fine tune the proposals to be submitted to government.
According to the sources, the American company, whose identity could not be disclosed for security reasons, would employ the integrated smart sensors and pipeline management systems which are the first and only one of its kinds in the world.
The technology will control, manage, protect and observe oil and gas production processes, as well as collect information every second for an automatic identification of problem areas for quick action.
According to sources, the technology is also capable of leak detection, threat recognition, intruder detection and prevention, pipeline balance reporting, production reporting and automatic response procedures, adding that it simply combines operations control monitoring with asset monitoring and protection.
The equipment are to be installed in strategic places to enable mobile operators and security agents in vehicles and offices to monitor, detect and recognise events, activities and movement of persons and vehicles within a distance of one kilometre on both sides of an oil installation with the aid of full motion video.
The basic ingredients required for the security of oil wells, production facilities and pipelines are the ability to promptly identify and recognise threats, disruption of service (leaks and breakages) and mount defence against the destruction or theft of the installation, pointing out that the technology is well-structured to meet these challenges.
Oil companies pledge support
On the cost of the project, the company sources said the company was yet to conclude the pilot survey to determine the actual cost of the project, but they said the infra-red cameras which would be installed at every 1km to 5km to cover the network of the 5 000km NNPC pipelines comprising 4 315km of multi-product and 685km of crude oil pipelines, cost between US$3 000 and US$20 000 each depending on the quality and range.
BusinessDay gathered that Chevron, Shell Petroleum Development Company (SPDC) of Nigeria Limited and other oil companies operating in Nigeria had pledged their support for the programme. The Nigerian National Petroleum Corporation (NNPC) and the Department of Petroleum Resources (DPR) have called for the project proposal. The sources hinted that in line with governments policy on local content, the project when completed would be managed by one of Nigeria s leading indigenous oil service company and communication giant.
Commenting on the proposed project, sources at the indigenous company who spoke to BusinessDay on condition of anonymity bemoaned the incessant vandalisation of oil facilities in Nigeria and described the technology as the only panacea to this problem.
Analysts say that the technology will be a landmark development in Nigeria s oil and gas industry as it will curtail the incessant vandalisation of oil pipelines and destruction of oil installations which have led to the loss of several lives and billions of dollars of oil revenue.
The attacks on oil installations, vandalisation of pipelines and kidnapping of oil workers have cut crude oil production by about 550 000 barrels a day, representing more than 20% of the country’s daily production. At an average price of US$73.32 per barrel, the 550 000 barrels a day production disruption translates to a financial loss of US$40 million a day or US$1.2 billion a month.
The loss has also prevented Shell from taking its own share of about 100 000 barrels a day to the international market while the destruction of gas pipelines has reduced the country’s power supply by 850 megawatts. More than 3 000 Nigerians have also lost their lives in pipeline explosions occasioned by the activities of vandals and saboteurs.
BusinessDay Online
China's oil field buying spree continues........
China looking to buy Canadia's Nations Energy and also a part of BP's Russian unit. Two articles pasted below.
ND9
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AFX News Limited
China's CITIC Group in talks to buy Canada's Nations Energy - report
06.05.2006, 10:11 PM
BEIJING (XFN-ASIA) - CITIC Group, a state-owned conglomerate, is in talks to buy Canadian oil company Nations Energy Co, the Wall Street Journal reported.
The newspaper, describing its sources as people familiar with the matter, said the cost of the purchase is estimated at 2.2 bln usd.
However, the Journal quoted one of its sources as saying that it is not certain that the deal will go through.
Nations Energy's main asset is the Karazhanbas oil field in Kazakhstan, which pumped 41,000 barrels of oil a day last year, according to the company's Web site.
If completed, the deal would be the third-largest overseas oil acquisition by a Chinese company and the second in Kazakhstan.
Last year, China National Petroleum Corp (CNPC) bought an oil field in Kazakhstan for 4.2 bln usd and built a pipeline to carry Kazakh crude to China.
Both CNOOC and CNPC had passed up on buying Nations Energy, the Journal said.
Nations Energy has been trying to sell itself for at least a year, the newspaper said.
It has proven reserves of 400 mln barrels, according to the company's Web site, and has smaller operations in Azerbaijan.
virginie.mangin@xinhuafinance.com
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BP discusses $4bn sale of oil fields to Russo-Chinese alliance
Terry Macalister
Tuesday June 6, 2006
The Guardian
BP is in talks to sell a key part of its Russian business for up to $4bn (£2.1bn) to an unusual partnership involving the local oil group Rosneft, which is soon to float, and Sinopec of China.
The potential deal involves the Udmurtneft part of TNK-BP, which produces 120,000 barrels a day of heavy crude and holds reserves of 1bn barrels but is in need of new investment.
BP, which has invested $8bn in TNK-BP over the last three years, declined to comment on the discussions, saying it was a matter for the Russian joint venture. But sources close to the London-based oil major insisted it did not signal any disenchantment with Russia nor any strategic deal with Sinopec.
Article continues******************************
China's oil field buying spree continues........
China looking to buy Canadia's Nations Energy and also a part of BP's Russian unit. Two articles pasted below.
ND9
*******************************************************
AFX News Limited
China's CITIC Group in talks to buy Canada's Nations Energy - report
06.05.2006, 10:11 PM
BEIJING (XFN-ASIA) - CITIC Group, a state-owned conglomerate, is in talks to buy Canadian oil company Nations Energy Co, the Wall Street Journal reported.
The newspaper, describing its sources as people familiar with the matter, said the cost of the purchase is estimated at 2.2 bln usd.
However, the Journal quoted one of its sources as saying that it is not certain that the deal will go through.
Nations Energy's main asset is the Karazhanbas oil field in Kazakhstan, which pumped 41,000 barrels of oil a day last year, according to the company's Web site.
If completed, the deal would be the third-largest overseas oil acquisition by a Chinese company and the second in Kazakhstan.
Last year, China National Petroleum Corp (CNPC) bought an oil field in Kazakhstan for 4.2 bln usd and built a pipeline to carry Kazakh crude to China.
Both CNOOC and CNPC had passed up on buying Nations Energy, the Journal said.
Nations Energy has been trying to sell itself for at least a year, the newspaper said.
It has proven reserves of 400 mln barrels, according to the company's Web site, and has smaller operations in Azerbaijan.
virginie.mangin@xinhuafinance.com
**********************************************
BP discusses $4bn sale of oil fields to Russo-Chinese alliance
Terry Macalister
Tuesday June 6, 2006
The Guardian
BP is in talks to sell a key part of its Russian business for up to $4bn (£2.1bn) to an unusual partnership involving the local oil group Rosneft, which is soon to float, and Sinopec of China.
The potential deal involves the Udmurtneft part of TNK-BP, which produces 120,000 barrels a day of heavy crude and holds reserves of 1bn barrels but is in need of new investment.
BP, which has invested $8bn in TNK-BP over the last three years, declined to comment on the discussions, saying it was a matter for the Russian joint venture. But sources close to the London-based oil major insisted it did not signal any disenchantment with Russia nor any strategic deal with Sinopec.
Article continues******************************
Balance, I guess the other thing I wonder about is the technical capabilities of Addax and Sinopec. Have they ever drilled and produced oil in water this deep? Could Addax potentially drill a few wells, then sell out to XOM or somebody else? Maybe that's their plan...... Anyway, I really don't know.... I've just been wondering about the technical challenges and obviously, the major costs necessary to produce oil in water of this depth.....
thanks,
ND9
CNOOC gets loan for projects in countries including Nigeria.
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CNOOC gets loan for project in Nigeria
Wing-Gar Cheng
2006-06-03
CNOOC Ltd, China's largest offshore oil producer, said it got a loan of 12.8 billion yuan (US$1.6 billion) from Export-Import Bank of China for capital expenditure on projects in countries including Nigeria.
CNOOC's loan will cover a period of 10 years at a fixed interest rate of 4.05 percent, the Beijing-based company said in a statement yesterday. CNOOC has the right to settle the loan before the term ends without any penalty. The company's debt-to-capitalization ratio will still be below 25 percent, it said.
"This financing activity will further optimize our capital structure," Yang Hua, CNOOC's chief financial officer, said in the statement.
China, the world's second-largest consumer of oil, is encouraging local companies to secure oil and gas supplies abroad to meet domestic energy demand and curb a reliance on crude imports that increased 25 percent in the first quarter. CNOOC has spent more than US$2.7 billion on acquisitions in Africa this year.
The company last month raised HK$15.4 billion (US$2 billion) after it sold 2.5 billion shares at HK$6.15 each, the top end of a range offered to investors.
Umbra,
I was just looking for your opinion on the future share price. You seem to have lots of opinions on ERHC which you post so I don't think it's unwise or unfair of me to ask you a question.
If you don't want to answer, I understand.
ND9
Umbra,
So if you had some extra cash, would you be a buyer here, or would you wait...... I mean, short term, sounds like you're saying price will fall, but long term, what are your thoughts on share price?
Thank you very much.
ND9
Taiwan grants US$3 million to Sao Tome and Principe to build airport and deepwater port [ 2006-06-01 ]
Sao Tome, Sao Tome and Principe, 01 June - Taiwan has offered Sao Tome and Principe US$3 million for the West African island nation to extend its international airport and build its deepwater port, Sao Tome’s minister of Public works said Wednesday.
Delfim Neves was speaking at a parliamentary session that opened the debate on the program established by Tomé Vera Cruz’s government.
In his speech, Neves said that the work on the two infrastructures would be financed using cooperation funds from Taiwan, which did not have to be repaid, US$1.2 million of which would be for expanding the airport and US$800,000 for the deepwater port.
The tenders for the two projects will be launched this year, with work on the port due to begin in 2007 and the airport’s expansion the year after that.
As well as support for the infrastructure sector, Taiwan, which ahs already invested over US$90 million over 9 years of bilateral cooperation, is also helping Sao Tome in the health and education sectors. (macauhub)
NWTF, I don't believe the Exxon CEO was worth $69M/yr in 2005 (and let me explain why). I believe Exxon has lots of other good people who could have run the company just as well for say, $5M/yr...... My point being is that all of these large company Board of Directors that authorize this kind of spending are just taking care of their own........ Exxon has 90,000 employees, many who have also been there 43 years, like the retiring CEO. Surely, one of those 90,000 employees could have run the company just as well for less than $69M...... That's my point.
Oh, and I'm also an XOM shareholder.....
ND9
NWTF - he also made $69.7M in 2005.
thanks,
ND9
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In 2005, Exxon CEO Raked in 190K a Day
Average Americans are struggling to keep up with persistently high gas prices, now approaching $3 a gallon. Testifying before Congress last November, Exxon CEO Lee Raymond blamed the problem on “global supply and demand” and assured the public that “we’re all in this together.”
Last year, Raymond made do with “a total compensation package” of just $69.7 million or $190,915 a day, including weekends.
Fishdog, do you really think Chevron and Exxon spent all those millions on getting the rights to JDZ Block #1 and they don't know if oil is there? Surely you are kidding? Of course they know there is oil in Block #1. US Oil companies have been in Nigeria and GOG for may years..... they know exactly what is there.
As for investors and others being upset with Exxon, you might want to read the article below. Exxon gave their retiring CEO a $400M dollar retirement package. I don't think they really care what other folks think......
ND9
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Senator rips ex Exxon CEO's retirement package
By Tom Doggett | April 18, 2006
WASHINGTON (Reuters) - Amid record oil prices and soaring gasoline costs, Exxon Mobil's $400 million retirement package to its former CEO is a "shameful display of greed" that should be reviewed by Congress and investigated by federal regulators, Democratic Sen. Byron Dorgan said on Tuesday.
Dorgan said he wants Exxon Mobil officials to appear at a Senate Commerce Committee hearing to explain how the corporation "justifies" giving its former boss, Lee Raymond, such a huge retirement package.
He also said the Securities and Exchange Commission should investigate the deal that "appears to shortchange" shareholders.
"There can be no more compelling evidence that the price gouging and market manipulation which has produced record oil prices is out of control, and is working to serve the forces of individual greed and corporate gluttony at the painful expense of millions of American consumers," Dorgan said.
Dorgan's criticism of Raymond's financial package came on the same day that U.S. crude oil prices hit a record high of more than $71 a barrel at the New York Mercantile Exchange.
Higher crude oil prices are helping to push of up gasoline costs. The Energy Department reported prices jumped 10 cents over the last week to a national average of $2.78 a gallon, up 55 cents from a year ago.
President George W. Bush said on Tuesday he was "concerned" about the impact high gasoline prices were having on families and businesses.
Exxon earned the wrath of many lawmakers when it reported more than $36 billion in profits last year as energy prices paid by consumers soared.
Dorgan said he will push to win passage of his legislation that would impose a windfall profits tax on big oil companies and rebate that money to consumers, unless the companies used their earnings to explore for and produce more energy.
"I think a sensible public policy would insist that the big oil companies either invest those windfall profits in things that will increase our own domestic energy supplies, or we should return some of that money to consumers," Dorgan said.
"Using them to drop $400 million dollars in the pocket of a big oil executive is simply unacceptable," he added.
Exxon Mobil has defended Raymond's retirement package, saying it was pegged to the rise in the company's profit and market capitalization that occurred during his tenure.
© Copyright 2006 Reuters. Reuters content is the intellectual property of Reuters or its third-party content providers. Any copying, republication, or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters.
Walldog, you're wrong about Cramer not wanting to talk to CEOs. I watched his show earlier in the week, and he had a CEO on.... In fact, if you go back over the months, he's interviewed lots of CEOs.
ND9
Nigeria: U.S. Explains Frequent Deployment of Warships
Daily Champion (Lagos)
May 31, 2006
Posted to the web May 31, 2006
Florence Udoh
Abuja
The United States of America (USA) yesterday said Frequent deployment of its warships to the Gulf of Guinea had assisted Nigeria to protect the region from the activities of terrorists and maritime criminals.
Commander of American Naval Forces in Europe and Africa, Admiral Harry Ulrich who disclosed this dispelled insinuations that the presence of the warships was a preclude to launching a military attack on the country or further individual interest.
Answering questions from reporters at the on-going Seapower for Africa symposium at the Transcorp Hilton Hotel, Abuja, Admiral Ulrich, said regular patrol of the region was imperative to secure our biggest oil field, Bonga project.
Ulrich maintained that much as the Nigerian government is trying its best to secure the region, reports available to Washington indicate that the Gulf of Guinea is full of international criminals including terrorists, sea pirates and smugglers are part. Ulrich said that considering the dependence of America on Nigeria¡¯s oil, they are bound to show concern for the country (Nigeria). In his words, ¡
Said he: "We hear series of stories for our presence in the Gulf of Guinea, but I want to say that we are concern for Nigeria and we want to help her protect the region from the hands of maritime criminals. Ulrich said. He continued, "In all parts of the world, the US and any good nation want a safe coastal and safe coast for those countries who are supplying our/their energy, and that is why we are often there.
Meanwhile, so there is nothing to fear for Nigeria he assured. In the meantime, the South African Chief of Naval Staff (CNS), Vice Admiral Retiloe Mudimu, yesterday blamed the frequent disasters that have befell the maritime industry in the continent on the refusal of African States to implement the ratified conventions governing the industry. Towards this end, he called for, a better ties among African countries on maritime disaster management.
Admiral Mudimu while reacting to the high number of human and materials that were lost in the far Tsunami disaster in Indonesia and the number of ship mishaps in Africa noted that, despite the distance between Africa and Indonesia, the Tsunami disaster still had a divastating effect on Somalia because there were no detection of the earthquake several hours after it occurred.
Meanwhile, Chief of Naval Staff[ CNS], Vice Admiral Refiloe Mudimu has called for a strong united co-operation of all African nations in order to avert maritime disasters such as that of the sinking of the Egyptian Ship Al-Salaam Boccaccio 98 in the Red Sea in February 3, 2006 , and sinking of the South African M.V. Oceanos ship on August 1991 amongst many others, which not only cause loss of many lifes of Naval officers but also result in loss of great economic loss to the nations affected.
Speaking yesterday at the on-going 2006 Sea Power For Africa Symposium, holding in Abuja, the South African CNS, stated that there was urgent need to prevent such disasters and the feat was only achievable through joint co-operative efforts.
He added that the world is fast becoming globalised and the global economy is fuelled by international trade most of which is Sea- Borne.
This underscores the critical significance of ensuring that we establish and effectively maintain maritime distress areas, chart exclusive economic zones and continental services and establish and constantly update co-operation and hence ensue co-ordination between parties and states for search and rescue operations and others he stated.
He also emphasized the need for all African countries to comply with guidelines of relevant conventions such as the United Nations International Convention on Maritime Search and Rescue , 1979 under the auspices of the United Nations International Maritime Organisation (Imo) with its slogan , safe, secure and efficient shipping on all oceans. He mentioned other conventions such as the International Maritime Organisations International Ship and Port Security Code 2002 amongst others which he said are all meant to maintain accepted international recommended practices.
According to him, a great number of disasters on sea and oceans would have been avoided in Africa if these conventions and enactments were adhered to.
Also, the South African Director of Naval Policy, Rear Admiral Bryan Donkin who presented a paper Maritime Disaster Management in African: An appraisal pointed out that most African Navies are insufficiently trained in safety management especially in fire-fighting and emergency evacuation procedures.
He called for more training of all Naval staff in the continent.
Also speaking at the occasion, the Chief of Naval Staff of the Nigerian Navy, vice Admiral Ganiyu Adekeye added that to prevent such maritime disasters, there was a need for frequent inspections of ships, more safety restrictions and better training of crew members.
A Warning to Africa: The New U.S. Imperial Grand Strategy
by John Bellamy Foster - June 2006 edition
http://www.monthlyreview.org/0606jbf.htm
China to complete 4 oil reserve bases by 2008
(chinanews)
Updated: 2006-06-01 07:20
Xiong Guangkai, director of the Institute for International Strategic Studies of China, proclaimed in his article that China had made a plan for the first-phase construction of four strategic oil reserve bases in 2004.
The oil reserve base in Zhenghai region of Zhejiang Province has been basically completed at present and will be put into operation by the end of this year. The other three are scheduled to be finished in the next two years.
Xiong pointed out that China is both the second largest energy producer and consumer in the world. Its total energy output is high but the per capita quantity is comparatively small, not even half of the world's average.
China's energy consumption kept increasing along with the economic growth in recent years, and the consumption is quite strong in a period of accelerating industrialization and urbanization.
As the economic scale expands, energy consumption will maintain a rapid growth, which will render great pressure on energy supply. Hence the demand and supply conflict will exist for a long time.
The Chinese government is taking a series of policies and measures to solve the energy security problem, a strategic issue that will affect the national security. It has elevated energy saving and reduction of energy consumption to the level of basic national policy and given them top priority in China's energy strategy.
The 11th Five-Year Plan (2006-2010) put forward some energy-related objectives, such as to build a "resource-economic society" and reduce 20% of energy consumption in per unit GDP during this period.
China will carry out the strategy of oil supply diversification and exert greater efforts in substitute energy source development.
In order to realize diversified oil supply, China will raise the quotas of oil imports from Russia, Central Asia, Africa, Latin-America and other regions in addition to maintaining oil imports from the Middle East.
XOM shareholders meeting May 31, 2006
May 30, 2006, 4:48PM
Tillerson to Lead Exxon Mobil Gathering
By STEVE QUINN AP Business Writer
© 2006 The Associated Press
IRVING, Texas — With his company having earned $8.4 billion during the first quarter, Rex Tillerson appears to be in an enviable position as he presides over the first Exxon Mobil Corp. annual meeting since he became chairman and CEO. That huge profit won't necessarily shield Tillerson from criticism from shareholders, particularly on the oil company's environmental record.
But Tillerson won't be a novice at fielding complaints about Exxon when shareholders meet in Dallas on Wednesday _ for months he's been hearing rebukes from public officials and private citizens about the soaring cost of gasoline.
In an interview with The Associated Press, Tillerson said he understands nerves are raw about gas prices pushing $3 a gallon while his company consistently posts record quarterly profits. And he knows lawmakers are simply responding to voter concern when they demand accountability at a Senate judiciary committee as happened in March.
But, "I don't apologize for our success," Tillerson said.
A man groomed for the position he now holds, the Texas-born Tillerson, 54, succeeded Lee Raymond on Jan. 1. So far, he's used his engaging demeanor _ a change from Raymond's more abrupt tone with analysts and shareholders _ to show critics a warmer side of Exxon.
"I'd like to meet with him sometime," said California Democratic congresswoman Lois Capps, who has voted against pursuits of some domestic fields by big oil companies.
Tillerson took over as oil prices continued climbing amid concerns ranging from recent hurricane forecasts to ongoing geopolitical tensions. So he's spent time with lawmakers, imploring them to take a long-term view of the country's energy policy, saying there are no immediate cures to price spikes in a volatile market. And he's visited world leaders in Indonesia and the United Arab Emirates, securing long-term production deals.
He said he's made sure Exxon is ready for this year's hurricane season, having watched hurricanes Katrina and Rita slam the Gulf of Mexico and destroy 113 platforms last year. Tillerson is likely to reassure shareholders Wednesday that the company is prepared.
But some shareholders will be pressing the CEO on the environment _ and asking when Exxon will follow the lead of competitors Royal Dutch Shell PLC and BP PLC by integrating cleaner, alternative energy into its portfolio.
Environmentally oriented shareholders are likely to bring the issue to Wednesday's meeting, says Rachel Harold of the Coalition for Environmentally Responsible Economies.
"We are not asking Exxon to get out of the oil business, and we are not asking them to change on a dime," Harold said. "We want them to create healthy ways to be successful 20 and 30 years down the line when the world looks different."
Exxon said it's not dismissing the value of alternative energy, citing the company's $100 million contribution to Stanford University's Global Climate and Energy Project. But even as alternatives are being developed, they still are not as readily available as oil and gas, Tillerson said.
Another issue expected to come up Wednesday is the retirement package given Raymond upon his departure; the package totaled nearly $400 million and included a $98 million pension payout.
Tillerson likely will report to shareholders that he's spent a great deal of time this year trying to ensure Exxon will get a steady supply of oil despite an increasingly volatile geopolitical climate. Energy rich nations such as Russia and Venezuela have been acquiring greater control over national resources. Nigeria is beset with rebel violence threatening the country's oil infrastructure.
These turns were one of the reasons Tillerson met with Arab and Indonesian government officials to close deals collectively worth nearly 1 million barrels of oil a day at peak production.
Tillerson faces domestic issues as well. In the interview with the AP, he noted that the United States has energy resources in places such as Alaska and coastal waters, and companies need exploration access to help boost supplies. So, after the House defeated separate measures to open up oil and gas drilling in the coastal waters two weeks ago, Tillerson called the decision "unfortunate."
Tillerson said he's concerned about "poor policy decisions that over the long run are not going to fundamentally address the longer-term energy needs of the United States, but instead are designed to make people feel better today."
Addax Petroleum Annual and Special Shareholders meeting scheduled for June 28, 2006, in Toronto, Canada.
China ratcheting up military to protect energy supplies
It's a long article, first piece below, for the rest go to link.
ND9
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China’s arms race raises tensions
By Jonathan Fenby
28 May 2006
WHILE proclaiming that it is pursuing a “peaceful rise” in global affairs, China is quietly ratcheting up its military power, spurred by concern about energy supplies.
This is causing growing concern in the United States and Japan, though Beijing still hopes to get the European Union to relax its ban on arms exports to the mainland.
The build-up has concentrated on the navy, new aircraft from Russia and improved control-and-command systems designed to make the sprawling People’s Liberation Army a more efficient fighting force.
Though the PLA’s main target remains the island of Taiwan, Beijing is increasingly motivated by its concern to maintain the energy supplies that power its 10% annual growth. The People’s Liberation Army (PLA) declares that its aim is to be a force “powerful enough to take on important missions on the basis of China’s economic development”.
This means having the capacity to protect energy supplies along sea lanes from the Middle East and West Africa, and overland from Central Asia.
In pursuit of the first objective, Defence Minister Cao Gangchun visited Singapore, Malaysia and Vietnam last month to discuss military co-operation. Beijing already has a naval presence in southern Burma and Pakistan, and wants to expand its electronic surveillance capability to Cambodia and Bangladesh. It is also stepping up contacts with Yemen in the hope of getting a base there close to the strategic Straits of Hormuz.
Fresh battlefield concepts are being taught and tested on computer models – the Chinese army newspaper says more than 60,000 “armed combatants” have gone through the process.
As revealed by two Chinese academics, Wu Lei and Shen Qinu, in the latest edition of the Far East Economic Review (FEER), the PLA is setting up combined arms battle groups for what are known as “active defence” operations deep inside foreign territory – a major break with the Maoist tradition of simply defending China’s borders and being ready to fight any invader inside mainland territory.
These units each equipped with 500 fighting vehicles and more than 100 helicopters. would also contain artillery, air and chemical defence, communications and an electronic warfare detachment, according to military expert Martin Andrew writing for the Jamestown Foundation.
http://www.thebusinessonline.com/Stories.aspx?China%E2%80%99s%20arms%20race%20raises%20tensions&...
Sinopec reshuffles board
UPDATED: 09:05, May 26, 2006
China Petroleum & Chemical Corporation (Sinopec), China's largest oil refiner, has replaced 10 members of its board of directors the biggest management reshuffle in the company's history.
Sinopec appointed its president, Wang Tianpu, as a director of the board, while former president Wang Jiming retired from the board, according to a statement.
The reshuffle has put mainly young, experienced leaders in charge of the company, which is listed in Hong Kong, New York, London and Shanghai.
The new structure will not have a big impact on the company's business, said an oil and gas analyst who declined to be named.
Sinopec reshuffled senior managers only last March, when Wang Jiming, over 60, resigned as president and Mou Shuling left the senior vice-president post.
Current President Wang Tianpu, and another senior president, Wang Zhigang, are both aged in their 40s.
Younger leaders now dominate the management of China's major listed oil companies after recent high-level reshuffles.
PetroChina, a Hong Kong-listed company of the China National Oil Corporation (CNPC), China's largest oil producer, announced the appointment of seven senior officials last year, shortly after China Petroleum and Chemical Corporation, China's largest refinery, announced its appointment of three senior officials in its Hong Kong-listed company Sinopec.
Analysts said that recent high-level reshuffles in China's major oil companies suggest a trend towards young, but experienced, managers.
Shares in Sinopec yesterday fell 3.72 per cent to HK$4.52 (56.5 US cents) on the Hong Kong stock exchange.
Analysts said the recent oil rise would be beneficial to the company.
For Sinopec, the nation's No 2 oil and gas producer boasting the largest refining capacity in Asia, the benefits of the price rise over the second half of the year are about 20 billion yuan (US$2.5 billion), according to a Citigroup analyst.
Source: China Daily
Sinopec aggressively seeking deepwater rig for JDZ Block 2.
Read article below......
ND9
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Equator Exploration Announces Completion of Owanare 1 as Gas
Thursday, May 25, 2006
Latest Oilvoice Headlines
- Equator announces gas discovery
- Well indicates gas-in-place of 185 bcf
Peak Petroleum Industries Nigeria Ltd. and Equator Exploration Ltd. have announced the discovery of gas in the exploratory 'Owanare 1' well, located on OML 122, offshore Nigeria.
The OML 122 licence area is located 25-60 km offshore and covers an area of 1,295 sq km on the Western Niger Delta. Owanare 1, the second well drilled on OML 122 by the Peak/Equator JV, is located in a water depth of 137 metres. The well has encountered high pressures and temperatures at a depth of 4100 metres making it necessary to suspend the well for later possible production. Gas was discovered in a 48 metre zone (157 feet) in the interval 1,683-1,732 metres brt and in a 13 metre zone (43 feet) in the interval 2,183-2,196 metres brt. The independent advisers to Equator, Horizon Energy Partners B.V. ('Horizon'), estimate the gas-in-place to be 185 bcf, an amount capable of commercial production as a satellite to a gas development of the B-DX1 discovery.
The aim of the Peak/Equator drilling campaign is to prove up significant volumes of gas for potential supply to the numerous gas-utilisation projects currently underway or in planning stages in Nigeria within close proximity to OML 122. A secondary objective is to develop and produce the B-DX1 oil discovery.
After the suspension of the Owanare well, the rig will move 18 miles to the north to commence development drilling on the B-DX1 discovery. Evaluation of additional exploration and appraisal opportunities continues in and around the area of OML 122.
Elsewhere, Equator has paid signature bonuses and given guarantees to the authorities for its share of the work obligation, including a total of five wells, on deepwater OPL 321 and OPL 323, offshore Nigeria, and on deepwater Block 2 in the JDZ between Nigeria and Sao Tome & Principe. The 3D seismic surveys have already been acquired and the operators of the blocks, KNOC for OPL 321 and 323 and Sinopec for Block 2, are aggressively seeking deepwater rigs.
Commenting on the results of Owanare 1, Wade Cherwayko, Chief Executive Officer of Equator, said:
'The results from Owanare 1 are disappointing in terms of total volume discovered. Nevertheless, we do have a discovery which is yet another strong indication that OML 122 and its surrounding area have an active petroleum system and excellent reservoirs, providing many highly prospective exploration and appraisal opportunities. We look forward to commencing the drilling programme on the oil development of B-DX1'
China Energy Executives Getting the World's Best Energy Management Training
Tuesday May 23, 9:00 am ET
SAN FRANCISCO, May 23 /PRNewswire/ -- "I cannot wait to return to the classroom every month. This is a great program for us to learn western management theories and practice with a focus on energy business," says Daqing Jiao, Deputy Director of a subsidiary of China Petroleum and Chemical Corporation (Sinopec) and one of the 30 executives from Sinopec in the University of Houston's energy Executive MBA program offered in Beijing. All his fellow students share his feeling.
A Fortune 500 company, Sinopec recognized the challenges it faces as China becomes a global player in the world economy. "We must provide the best training to our people so they can develop the knowledge and skills needed to meet the challenges in the ever changing energy world," notes Mr. Chen Tonghai, President of Sinopec.
Franklin Institute of Management (FIM), a leading training and consulting organization, managed by experienced Chinese-American professionals educated in the United States, recognized the need in China for a top quality graduate level executive training program for the energy industry and sought collaboration with the Bauer College of Business at the University of Houston. Situated in the "Energy Capital of the World," the Bauer College is home to the Global Energy Management Institute, a recognized leader in energy management research and education.
"This program is unique. To our knowledge, we are the only business college specializing in training executives for the energy industry and the only one doing this in China," notes Dr. David Shields, Associate Dean of the Bauer College.
"We are very pleased to work with Sinopec and the Bauer College. We expect this program to grow substantially as more Chinese energy companies seek to ramp up their management expertise. Students find our program very rewarding because it not only teaches them theories but also gives them the useful tools that they can use in solving real world problems," says Henry Chang, President of FIM and an ex-McKinsey consultant.
The China program's curriculum is identical to that offered on Houston campus, and China students will take two courses in Houston to have opportunities to interact with their American counterparts and take learning tours to US energy companies. Students who successfully complete the program will obtain an MBA degree from the University of Houston.
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Source: Franklin Institute of Management
China lends Nigeria $1.6b to fix rail
Tuesday May 23, 2006
By Chris Buckley
BEIJING - China will give Nigeria a US$1 billion ($1.62 billion) loan to fix its dilapidated railways, Xinhua news agency said yesterday, in another sign of China's growing economic sway across Africa.
Nigerian Finance Minister Ngozi Okonjo-Iweala announced the deal in Abuja, Nigeria's capital.
"Provision of infrastructure is critical for economic development," Xinhua reported her as saying.
Under the deal, China will give a concessional loan of US$1 billion and Nigeria will come up with matching funds. The money will be used to fix old lines and buy new rolling stock and equipment.
In past decades, China sent thousands of engineers and doctors to African countries in the name of revolutionary Third World unity. But now business interests are at the fore.
Last week, China's Citic group and China Railway Construction announced they had won a tender to build 528km of the 1216km Algeria East-West Highway.
In January last year, China offered Angola a US$2 billion loan to repair its infrastructure.
And in January this year, China's top offshore oil producer, Cnooc, agreed to pay US$2.3 billion for a stake in a Nigerian oil and gas field - its largest ever overseas acquisition.
China has rejected Western efforts to link aid and loans for African countries to demands for improved human rights and government accountability, saying countries should choose their own development priorities. China's hands-off approach has come under criticism from Western human rights activists, who say Beijing has put its economic interests before humanitarian concerns in Sudan and other strife-torn countries.
- REUTERS
Sinopec does not have deep water exploration knowledge?
Interesting comment from article below: "Carlos Saturnino, a Sonangol director who headed the committee that assessed the bids, said Sinopec did not yet have the technical knowledge to lead exploration in deepwater fields."
ND9
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May 22, 2006, 7:42AM
Total, Petrobras Win Bids in Angola
© 2006 The Associated Press
LUANDA, Angola — Total SA of France and Brazil's Petrobras won contracts to lead international consortiums that will explore two offshore oil fields in Angola, authorities said Monday.
However, the largest stakes in the two blocs are to be held by SSI, a joint venture between Angolan state oil company Sonangol and China Petroleum & Chemical Corp., or Sinopec.
Carlos Saturnino, a Sonangol director who headed the committee that assessed the bids, said Sinopec did not yet have the technical knowledge to lead exploration in deepwater fields. Sinopec is Asia's largest refiner by capacity.
Total is to pay Angola $670 million and Petrobras $310 million in "signature bonuses" _ one-time cash payments made upon signing the contracts, Saturnino said.
Earlier this month, Italian energy company Eni SpA paid $902 million to secure a controlling stake in Bloc 15. Total and Petrobras are part of that bloc's consortium.
Angola only recently began declaring the amount paid in signature bonuses after pressure from human rights groups and foreign governments for greater transparency. Rights groups have charged that the money is diverted to a corrupt elite.
Total is to head exploration in a deepwater field called Bloc 17. As lead operator, it is to have a 30 percent stake in the field, with SSI taking 27.5 percent and Sonangol holding 20 percent, Saturnino said.
In Bloc 18, Petrobras was granted a 30 percent share, with SSI taking 40 percent and Sonangol 20 percent.
Smaller local companies took the remaining stakes.
Angola is the second-largest oil producer in sub-Saharan Africa after Nigeria. The Oil Ministry predicts Angola's daily output will rise to 2 million barrels a day by 2008.
China Seals Oil Exploration Deal with Nigeria
Making inroads into area dominated by Western countries
Njei Moses Timah (njemotim)
Published on 2006-05-21 14:54 (KST)
Nigeria gave four of 17 drilling licenses to China National Petroleum Corp. (CNPC) on May 19. The deal cements an agreement made last month during a visit by Chinese President Hu Jintao.
China will explore two areas in the restive, oil-producing Niger Delta and two areas in the Chad basin, where oil is yet to be produced. In exchange for the licenses, China will invest $4 billion to build a railway system and power stations and to control a stake in the 110,000 barrel-a-day Kaduna oil refinery.
China is expected to pay some $15 million for the exploration rights in the Niger Delta, and a much smaller amount for the rights in the "risky" Chad basin.
"The success at the bidding has given us the opportunity to be part of Nigeria's massive oil sector," said Huang Yu, vice president of CNPC. Eleven companies qualified for the bid including two local companies. In the agreement made last month, China held first right of refusal for four exploration licenses in the auction.
Nigeria is the largest oil producer in Africa and the seventh largest in the world with an estimated daily production of 2.6 million barrels of crude oil. China is the biggest consumer of oil after the United States.
As its consumption continues to rise, China's quest for new sources of oil has become more and more urgent. The deal is seen as a significant first step for China in positioning itself as a future player in the Nigerian oil sector, which is dominated by Western countries.