I am going to the mall now. I don't want to be around when you blow. vbg
Updated 3:27 PM ET August 7, 2005
By The Associated Press
SYDNEY, Australia (AP) - Actor-director Mel Gibson has been asked to recreate the crucifixion of Jesus Christ in the streets of Sydney if the city is selected to host a major Catholic gathering in 2008, a newspaper reported.
Gibson's staging of the Stations of the Cross, a live interpretation of Christ's final hours, would be part of a bid by the city to secure the Catholic Church's World Youth Day in 2008, the Sydney Morning Herald reported Saturday.
The crucifixion reenactment _ similar to scenes from Gibson's hugely successful film "The Passion of the Christ" _ would begin with the Last Supper staged at Sydney's landmark Opera House at sunset, and would end with the crucifixion of Christ at St. Mary's Cathedral, according to bid documents the newspaper said it obtained.
The Archbishop of Sydney, George Pell, said intermediaries had approached Gibson about staging the event. Gibson's involvement with World Youth Day was on the city's "wish list," Pell said.
"He might well be attracted. I think his devotion to Christ is very real," he said.
The venue for the 2008 gathering, expected to attract an estimated 400,000 young Catholics from 160 countries, will be announced by the Pope on Aug. 21.
This is interesting on Unocal, more sector or technically oriented then we usually see.
Some points.
Unocal also would have been a rich prize for China given that the Dragon would then be in the middle of the UK’s and Washington’s strategy of geopolitical control over Eurasia through the pipelines. #msg-6825938
And Unocal is sitting on a lot of known resources in Bangladesh, so the prospect of exporting to India in the long term is feasible, and the politics surrounding that issue looks like it is improving.
China would then have been in the position to possibly block the export of gas to India whom we are using to contain China.
-Am
Unocal a rich prize for Chevron By Jeff Moore
Aug 11, 2005
Now that CNOOC has dropped its bid for Unocal, Chevron in all likelihood will gain control after Unocal shareholders vote on the takeover bid on Wednesday, August 10. If Chevron wins, it has everything to gain. After years of declining production from its own assets, it stands to acquire Unocal's strong and promising production assets in Thailand and Indonesia. Farther west, there are two other Unocal gems that show great potential - Bangladesh and Azerbaijan. The first has natural gas and the second offers a route into Caspian oil assets, and one of the biggest pipeline projects in history.
Bangladesh Unocal entered the Bangladesh market in 1974 with an offshore block under a production-sharing contract (PSC). But it handed over its single 1977 gas discovery back to the government because of the country's then unprofitable domestic gas market. In 1996, Unocal went back in a 50-50 partnership with Occidental for three onshore blocks near the border with India. In 1999, it bought all of Occidental's shares and became 100% owner in all three blocks.
Presently, Unocal operates under three PSCs on three onshore blocks - 12, 13 and 14 - located 62 miles (100 km) northeast of Dhaka, bordering India. Unocal sells its gas to the government via three natural gas purchase and sales agreements (GPSAs). "Unocal's original plan in Bangladesh was mainly to sell gas to India, which made things politically challenging," says Duane Grubert of Fulcrum Global Partners. When Unocal began, there was little domestic market for its own gas reserves.
Adds Steven Knell, an Asian energy analyst at Global Insight, "The economy in Bangladesh is primarily an agrarian economy that has traditionally relied on low-yield, high-pollutant fuels, which does not mesh with their new, national economic plan that calls for industrial development. And they need modern oil and gas to do this. This is why they were upset about Unocal exporting gas to India. Plus, there is some historical animosity between the two nations that still causes friction now and then."
"But the domestic oil and gas market is currently expanding and improving, which makes it an alternative outlet beyond the idea to export to India," comments Grubert. "So now, Chevron could use Unocal's position to feed the domestic market for a long period of time, much like what Unocal does in Thailand. And Unocal is sitting on a lot of known resources in Bangladesh, so the prospect of exporting to India in the long term is feasible, and the politics surrounding that issue looks like it is improving."
The company's first successful project in Bangladesh was Jalalabad field in Block 13. Knell says, "They've got significant reserves there at that site, about 1.5 trillion cubic feet (tcf) (42 billion cubic meters, or bcf) of gas. The company is well placed to make a good return." In 2004, Jalalabad netted an average of 55 million cubic feet (mcf) (1.5 million cubic meters, or mcm) per day of natural gas and 405 barrels (bbls) a day of liquids.
Unocal's second and most recent Bangladesh production began in March 2005 in Block 14's Moulavi Bazar field, which is south of Jalalabad. Unocal signed a GPSA with Petrobangla, the state gas, oil, and mining company, to develop it in October 2003. It contains about 440 bcf of natural gas, and Unocal wholly owns the project. At present, it is producing 70 mcf per day of gas from two wells. It began drilling two more in May. To process gas from Moulavi Bazar, Unocal built a 14.9-mile pipeline and a 150-mcf-a-day gas processing plant that connects to Bangladesh's national gas grid. At peak capacity, the plant could process 600 mcf per day. The project cost US$$42.
Unocal signed its third GPSA with Bangladesh in November 2004 to produce natural gas from Block 12's Bibiyana field, which it discovered in 1998. According to Knell, "It operates under a PSC, which is standard for Bangladesh." Bibiyana has an estimated 5.5 tcf of natural gas and 30.7 million bbls of condensate, making it Unocal's biggest field in country. Its share is 98%. Bibiyana will have as many as 15 wells, and Unocal expects that by late 2006, it will be producing 200 mcf a day of natural gas. "Given the potential, Unocal is expected to sink $230 million in the field to commercialize it, and they are ramping up production," says Knell. "They expect to hit 500 mcf per day by 2009, and it will make a healthy contribution to Bangladesh's gas market and make a nice profit for Unocal." If Bibiyana reaches 500 mcf per day, it will be one of Unocal's biggest gas producers.
What all this means is that Unocal supplies Petrobangla with nearly 15% of Bangladesh's natural gas needs. Total natural gas production in Bangladesh for 2005 is at about 270 mcf per day by Jalalabad and Moulavi Bazar combined. Unocal expects its other projects to increase this to 35% three years from now. Natural gas wise, this would make the company as valuable to Bangladesh as it is to Thailand. More, says Knell, "Unocal's production operations there can make a huge difference in a positive way in improving the poverty line, which most live below."
Other assets Chevron might capitalize on include Bangladesh's offshore Block 7, a contract Unocal won in July 2005 for the Bay of Bengal. It is covered under an existing PSC. "Onshore exploration having been largely completed, offshore exploration and production is now increasingly dynamic," Knell says. "It will be the more vibrant area for Bangladesh in the future."
Adds Grubert, "Some producers prefer offshore because infrastructure is easily protected. Offshore projects, because they are isolated, don't have to deal with extensive security, and the government traditionally helps in these cases. And another thing is that Unocal was not dissuaded by politics to invest in Block 7 and expand its position there, so its situation is really improving."
According to Knell, "The renewed PSC is part of Unocal's Western Regional Integrated Project (WRIP), which is the company's proposal for developing the region." Specifically, WRIP is an ongoing, $1 billion project that involves producing gas from the Bay of Bengal, piping it 93 miles to Khulna, and feeding it to four power plants onshore. According to Knell, "The Block 7 PSC includes production from Shahbazpur field. The terms of this PSC are a three-year exploration license with the option to extend for four more in two phases." Bangladesh officials believe Shahbazpur holds 330-400 bcf of natural gas.
Azerbaijan After Azerbaijan declared independence in 1991, Unocal entered its energy market via PSC as a 10.28% shareholder of the Azerbaijan International Operating Company, or AIOC. There are 10 other investors, including BP, the consortium's operator. AIOC focuses on offshore gas and oil production in the Caspian Sea for export, specifically from the Azeri and Chirag fields, and the deepwater portion of Gunashli field. Unocal refers to it as the "ACG project", short for Azeri-Chirag-Gunashli. All are roughly in a line running east of Sangachal Terminal on the mainland. "For Chevron, between Bangladesh and Azerbaijan, Azerbaijan is the more important of the two," says Duane Grubert. "They did not previously have a presence there, and AIOC is a collection of international heavy hitters that they can now work with to expand and do other projects."
Andrew Neff, a senior energy analyst at Global Insight, specifies, "For Chevron, Unocal's assets in Azerbaijan are key. Acquiring Unocal will allow Chevron to create a Caspian oil 'bridge' with its assets in western Kazakhstan, where the company is heavily invested." He says Chevron had one unsuccessful investment in Azerbaijan, the Absheron field, but officially abandoned it in 2003 after drilling a failed well in 2001. But in Kazakhstan, he says, Chevron is invested in the Tengiz field with ExxonMobil, Kazmunaigaz, and LUKArco, a joint venture of LUKoil and BP. Chevron's share is 50% and output is 270,000 bbls a day. Tengiz has an estimated 6-9 billion bbls in reserves.
AIOC is driving its oil projects in Azerbaijan forward in four phases: Early Oil, and Phases 1, 2, and 3. Early Oil, which is in the Chirag field, began production in 1999 with 43 million bbls of oil a day. It currently produces approximately 150,000 bbls a day. Phase 1, the Central Azeri field, began in February 2005 and is projected to produce an average of 93,000 bbls of oil per day this year. Phase 2 consists of projects in the West and East Azeri fields, and Unocal officials think they will start production there between 2006-07. Unocal assesses that the Azeri projects are sitting on 2.7 billion bbls of oil. Phase 3 is a deepwater project, Gunashli, which is projected to begin producing in 2008. Combined, these projects will encompass five platforms. Current average production through the end of June 2005 was an estimated 203,000 million bbls a day.
AIOC has two pipelines running from the Caspian through the mainland that carry Azerbaijan's oil to export markets. It exports 97% of its oil through the Baku-Supsa pipeline, which runs from the Caspian west to Georgia's Black Sea coast. It exports the remainder through a north-running pipeline that connects to Russia's Black Sea coast.
But another pipeline project farther south is Azerbaijan's main attraction, the Baku-Tblisi-Ceyhan (BTC) pipeline, which began construction in April 2003. The BTC Company owns it, and Unocal is also an 8.9% investor. The BTC Company's largest shareholders are BP with 30.1% and the State Oil Company of the Azerbaijan Republic (SOCAR) with 25%. All others hold less than 10%. They include Statoil, TPAO, Eni, Itochu, INPEX, Amerada Hess, ConocoPhillips, and Total.
Spanning 1,100 miles from Azerbaijan to Georgia to Turkey's port city of Ceyhan on the Mediterranean, the BTC will move 1 million bbls of crude oil a day once the project is fully operational. The BTC Company began pumping oil into it on May 25 and it will take about six months to fill. As of 29 July, it was full up to the Georgian border. Unocal projects the pipeline will be filling up tankers at Ceyhan terminal by the end of 2005. The project cost, including loans, interest, and pumping oil into the pipeline to prime it, was $3.6 billion and required about 2,000 workers to complete.
It might alleviate Chevron's pipeline headaches in Kazakhstan. Neff says, "Chevron's had problems in seeking to expand capacity on the Caspian Pipeline Consortium's (CPC) pipeline from Tengiz to Novorossiisk, a Russian port on the Black Sea. Russia, which is a part owner, has continually demanded higher transit tariffs. And as the largest stakeholder in the pipeline, it has effectively blocked the CPC's other owners from proceeding with plans to boost capacity to allow it to export additional volumes. So acquiring Unocal and its stake in the BTC pipeline could give Chevron an additional export outlet aside from the CPC for some of their Tengiz oil production."
Unocal's Bangladesh and Azerbaijan assets are thus indeed appealing, not just for their present worth, but for their future production value as well, a key motivator for shrewd oil and gas investors. Assuming Chevron buys Unocal and does not divest its best Asia assets, it stands to strengthen its international standing and solidify its position as America's second largest gas and oil company behind ExxonMobil.
Duane Grubert says, "It is possible that the Unocal's shareholders might still vote not to accept Chevron's offer. They might say the price is too low, but I think Chevron should prevail on August 10. If so, Chevron is getting an absolutely discounted deal in that the whole evaluation for the company has gone up."
Concerning Bangladesh, Steven Knell remarks, "Chevron's potential in Bangladesh is gaining a foothold in the country and in the region. Chevron is likely hoping to consolidate its gas interests. Overall, it wants to be positioned to feed the growing market in Asia, and it's easier to buy Unocal than to go through the bidding process. The market for gas there is only going to get larger, and India's gas consumption is the largest in the region, so the potential to export gas from Bangladesh is real."
Regarding Azerbaijan and the Caspian Sea, "For Chevron, the benefit would be adding to its Caspian portfolio without having to do the work," says Andrew Neff. "They would be buying production, essentially. Chevron's been criticized for its declining production, which is one of the reasons they are moving on this. It boosts their production, gives a long-term and better foothold in Caspian, and provides a reason to look for other assets in Caspian and invest in Azerbaijan. For example, they have discussed a potential pipeline linking Azerbaijan and Kazakhstan via a Caspian sub sea pipeline."
So when Unocal shareholders vote to either accept or reject Chevron's buyout offer, gas and oil facilities ranging from Southeast Asia to Europe will be in play. Bangladesh and Azerbaijan, two assets that will likely provide long-term revenues for any company, will certainly help influence that outcome. If Chevron gains and keeps all of Unocal's Asia assets, there will be a new and improved oil and gas company in the region, and it will be a Goliath.
Jeff Moore is an employee of Science Applications International Corp, a consultancy with headquarters in San Diego, California, and MacLean, Virginia. He has researched and written more than 15 country profiles and studied the infrastructures of countries in Southeast Asia, Eastern Europe, Africa, and Latin America.
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