Oil & Gas 01 (May 08 - Jul 08)

[winston]

TOL:-
1) How long does it take to repair a damaged pipeline ?
2) How long does it take to send some US troops into the area, especially now that they have bombed a pipeline of a US Company ?

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Nigeria loses another 120,000 bpd after pipeline attack

LAGOS : Nigerian militants blew up a key oil supply pipeline operated by Chevron, in the latest attack targeting the country's multi-billion-dollar oil industry, company and military sources said Saturday.

The US oil giant was forced to shut down operations as a result of the attack Friday in the volatile Niger Delta, halting output by 120,000 barrels per day, an industry source said.

The latest attack came a day after Anglo-Dutch oil giant Shell said it could not promise to deliver 225,000 barrels per day for June and July following an unprecedented raid on its offshore Bonga oilfield.

Unrest in the Niger Delta has reduced Nigeria's total oil production by a quarter in the past two years, and the losses have contributed significantly to the recent surge in world oil prices.

"Chevron Nigeria Limited (CNL), operator of the NNPC/CNL Joint Venture, can confirm that one of its pipelines was breached at about 10.40 pm on Thursday, June 19, 2008 in the swamp area of Delta State," the firm said in an e-mail statement to AFP.

Company spokesman Kurt Glaubitz said, "the joint venture's onshore production has been shut in to protect the environment."

He said the company was assessing the situation and could not "provide specific production figures."

However industry sources said Chevron had declared force majeure, halting 120,000 barrels per day output.

Force majeure is a legal clause allowing producers to miss contracted deliveries because of circumstances beyond their control. Shell also declared force majeure on 225,000 barrels per day for June and July deliveries on Friday.

Nigeria's military Joint Task Force (JTF), protecting oil facilities and personnel in the restive region, confirmed Friday's incident.

"The attack took place yesterday near Escravos. The supply pipeline was blown up. The company has shut down operation in the area," JTF commander Brigadier-General Wuyep Rimtip told AFP Saturday.

Rimtip said the attack on the Abiteye-Olero crude oil lines could have been carried out by militants using explosives and rocket-propelled grenades.

"We have launched a manhunt for the attackers," he said, adding that no-one was hurt in the incident.

No group immediately claimed responsibility for the latest attack.

Thursday's raid by speedboats on the floating production plant in the Bonga oilfield 120 kilometres (75 miles) offshore was claimed by the Movement for Emancipation of the Niger Delta (MEND) which has carried out a string of attacks on oil facilities in recent months.

Earlier Saturday, MEND, the best equipped and most organised of the armed groups operating in the Niger Delta, urged foreign workers to leave the region, warning of fresh unrest following a government crackdown on the militants.

Chevron operates and holds a 40 percent interest in 13 concessions covering 2.2 million acres (8,900 square kilometres), predominantly in the onshore and near-offshore regions of the Niger Delta.

Last year its total production from 32 fields averaged 353,000 barrels per day of crude oil, 14 million cubic feet of natural gas and 4,000 barrels of liquefied petroleum gas (LPG), according to its website.

According to International Energy Agency statistics, Nigeria produced an average 2.13 million bpd in 2007, making it the 13th biggest producer in the world.

But it has slipped from its position as Africa's largest producer, being overtaken in April by Angola.

- AFP /ls

[winston]

From wikipedia:-

The Movement for the Emancipation of the Niger Delta ("MEND") is a militant indigenous people's movement dedicated to armed struggle against the exploitation and oppression of the people of Niger Delta and the degradation of the natural environment by foreign multinational corporations involved in the extraction of oil in the Niger Delta and the Federal Government of Nigeria. MEND has been linked to attacks on foreign owned petroleum companies in Nigeria in an attempt to create an artificial Hubbert peak.

MEND's stated goals are to localize control of Nigeria's oil and to secure reparations from the national government for pollution caused by the oil industry. In an interview with one of the group's leaders, who used the alias Major-General Godswill Tamuno, the BBC reported that MEND was fighting for "total control" of the Niger Delta's oil wealth, saying local people had not gained from the riches under the ground and the region's creeks and swamps." [1]

Additionally MEND has called for President Olusegun Obasanjo to free two jailed ethnic Ijaw leaders — Mujahid Dokubo-Asari, who is jailed and charged with treason, and Diepreye Alamieyeseigha, a former governor of Bayelsa State charged with corruption.

Origin:-

For the roughly fifty years since Nigeria declared independence from British colonial rule, oil has been produced in Nigeria. Throughout this period corporate politics has intersected with successive dictatorships. Under these dictatorships the Nigerian government has signed laws that appropriated oil resources and placed these under the control of multinational oil companies, such as Chevron Corporation, and most notably, Shell.

From the point of view of MEND and its supporters, the people of the Niger Delta have suffered an unprecedented degradation of their environment due to unchecked pollution produced by the oil industry. As a result of this policy of dispossessing people from their lands in favor of foreign oil interests, within a single generation, many now have no ability to fish or farm.

People living in the Niger Delta have found themselves in a situation where their government and international oil companies own all the oil under their feet, the revenues of which are rarely seen by the people who are suffering from the consequences of it.

Kenneth Roth, Executive Director of Human Rights Watch, has said of the situation, "The oil companies can't pretend they don't know what's happening all around them. The Nigerian government obviously has the primary responsibility to stop human rights abuse. But the oil companies are directly benefiting from these crude attempts to suppress dissent, and that means they have a duty to try and stop it."[4]

However Eghare W.O. Ojhogar, chief of the Ugborodo community, alleged, "It is like paradise and hell. They have everything. We have nothing... If we protest, they send soldiers."

Over the last twenty years various political movements and activists have emerged in opposition to the perceived injustices perpetrated upon the people of the Niger Delta by the government and the oil companies. These were usually nonviolent; Ken Saro-Wiwa was the most famous activist. Saro-Wiwa was an Ogoni poet, turned activist who was executed by the Nigerian government in 1995 on what many believe to be deliberately false charges with the aim of silencing his vocal opposition to the oil interests in Nigeria.

In Saro-Wiwa's footsteps came others who, instead of believing in nonviolent activism, advocated violence as resistance to the ostensible enslavement of their people. Militants in the delta enjoy widespread support among the region's approximately 20 million people, most of whom live in poverty despite the enormous wealth generated in the oil-rich region.

[winston]

THE WORLD'S STEADIEST UPTREND

We found the steadiest uptrend in the world for you this week: The growth of Chinese oil imports.

From 2000 to 2003, Chinese oil imports floated around 600 metric tons per month. In 2003, the world's most populous country broke the 800 metric tons per month barrier. In 2005, it broke 1,200 metric tons per month.

This April, China imported over 1,400 metric tons of oil – more than double the amount from five years ago.

– Brian Hunt

[winston]

THE WORLD'S STEADIEST UPTREND

We found the steadiest uptrend in the world for you this week: The growth of Chinese oil imports.

From 2000 to 2003, Chinese oil imports floated around 600 metric tons per month. In 2003, the world's most populous country broke the 800 metric tons per month barrier. In 2005, it broke 1,200 metric tons per month.

This April, China imported over 1,400 metric tons of oil – more than double the amount from five years ago.

– Brian Hunt

[winston]

United States welcomes China move to cut fuel subsidies

JEDDAH, Saudi Arabia (AFP) — US Energy Secretary Samuel Bodman on Saturday welcomed Beijing's decision to cut subsidies on petrol and diesel prices.

"The steps that the Chinese took, although viewed by some as courageous, were exactly the right sort of steps to take," Bodman told a press briefing in the run-up to the Jeddah oil summit on Sunday.

China lifted petrol and diesel prices by more than 16 percent last week in a bid to reduce the gap with soaring cost of oil on international markets.

Asked if China's move would help the energy market, Bodman replied: "I think it will."

"When we say to move away from subsidies, we are not saying we want to eliminate subsidies tomorrow.

"We believe that all nations in the business of subsidising oil are in a very tricky position that leads to the possibility of what could be viewed as irreponsible behaviour.

"That is to say, if they are not taking steps over time to eliminate the subsidy."

Bodman said that around 30 million barrels per day of oil was consumed in nations that subsidise gasoline.

"That's simply too much. If there is anything that is clear, the world needs help in this regard."

Western nations led by the United States argue that many emerging Asian economies are artificially propping up record high oil prices with subsidies.

"The world has to move away from market-distorting, untargeted fuel subsidies that in my judgment make matters worse," Bodman said.

[kennynah]

i just heard briefly on channel news asia about the outcome of the talks at Jeddah

a) some usd1bil to aid development of energy resource for developing countries
b) some usd500 mil again as some form of aid for emerging countries
c) think high oil price as speculative...
d) maintains the earlier 200K additional barrel

this is a slap on the face of those who were expecting a lot more...

shit is so so near to hitting the spinning blades on of the ceiling fan... better put on the rubber...

suit.

[HengHeng]

Trust me unless China is getting a fair cheaper oil than others or else , i don't expect oil to hit 200 by the end of the year.

I'm game to say that oil prices would drop toward the end of the year by how much i'm not sure but i'm pretty confident that it would be far away from its highs .

[millionairemind]

Not sure if all this "rift within OPEC" is staged??? Wonder if the disruption in Nigeria was caused by those LONG in oil?? hmm... Conspiracy Theories abound..

Opec rift fuels new fears for oil prices
By Angela Monaghan
Last Updated: 12:43am BST 23/06/2008

Fears that the price of oil could reach new highs in the coming weeks have intensified following the emergency meeting of the world's oil powers in Saudi Arabia.

Oil go my way: Signs of a split between OPEC countries

Saudi Arabia, the world's biggest exporter of oil, confirmed well-trailed plans to raise production by 200,000 barrels to 9.7m barrels a day - a 30-year high - at yesterday's emergency summit.

However, oil traders warned that a lack of other concrete measures, threats by other OPEC members to decrease production in response to Saudi Arabia's move and news that Nigeria's production had been further hit by rebel attacks on pipelines could drive prices up even further.

"There is the danger that the markets will be disappointed and the price will increase again," said Germany's economy minister Michael Glos.

More on oil - OPEC president Chakib Khelil dismissed Saudi Arabia's pledge to increase oil production, saying that it was not a lack of supply that was driving prices up but speculative investment. Asked if he thought that oil prices would fall after the meeting, Mr Khelil, the Algerian oil minister, said: "I don't think so."

Jeroen van der Veer, chief executive of oil giant Royal Dutch Shell, agreed that there would be no "silver bullet" solution to curb spiralling oil prices. "What I've heard so far are basically all good ideas, but it will probably not change the price tomorrow morning," he added.

Signs of a growing split between OPEC countries were clear, with Venezuela, Libya, Algeria, Iran and Qatar opposed to an increase in oil production on the grounds that speculative investment in financial markets was to blame for the price hikes, not a lack of supply. Libya said that it would consider reducing production in response to Saudi Arabia's statement that it would increase supplies. Kuwait, however, suggested that it would follow Saudi Arabia and increase production.

Venezuela's finance minister Ali Rodriguez, a former head of OPEC, also said that he expected prices to rise further.

The meeting in Jeddah was attended by 35 countries, seven international organisations, and 25 oil companies. It was called by the Saudi government to discuss spiralling oil prices, which have doubled to almost $140 a barrel in the past year. Prime Minister Gordon Brown and US energy secretary Sam Bodman were among the high-level delegates who attended.

A large number of delegates at the urgently convened meeting called for greater regulation of oil investors.

The head of Libya's national oil company said that it was unrealistic to come up with a quick fix to such a major issue: "We are coming to discuss a very important subject, supposedly, and expected to get an important decision in three hours," he explained. "That's impossible."

Mr Brown called for greater market transparency, and reiterated the view, shared by the US, that oil-producing countries should produce more.

He also called for an increase in the supply of alternative energy sources, including nuclear power, and invited foreign oil producers to invest in renewable energy production in the UK, and the next generation of nuclear power.

Mr Brown also offered to host a follow-up meeting in the UK before the end of the year.

While Saudi Arabia is seeking to increase oil production, it emerged that Nigeria, Africa's second largest oil producer, is producing at its lowest level in 25 years after rebel attacks on facilities operated by Royal Dutch Shell and Chevron.

It is estimated that Nigeria's output has been cut by around 300,000 barrels a day as a result of the violence. "Onshore production has been shut in order to protect the environment. We're hopeful that production can be restored as soon as possible," said Chevron.

Over the weekend Chevron said its Abiteye-Olero pipeline had been attacked by rebels on Thursday, halting the shipment of about 120,000 barrels of crude oil a day.

[blid2def]

Going by my irrational inference and speculation:

1. Wheat: "$10 a bushel" - result: Hit $10 a bushel, short stay, turn down. Anybody hear that mentioned anymore?

2. Gold: "$1000 a troy ounce" - result: Hit $1000 a troy ounce, short stay, turn down. We may hear that record played again soon perhaps though.

3. Oil: "$150 a barrel" - result: Hit $150 a barrel and turn back? Maybe hit $150, equities market finally take that as a signal to go for a major shit; BB's use that as an excuse (inflation, demand drop, blah blah) to shock oil down.

4. Then we recycle story - back to (1) or (2) again (but maybe raise the price target by 50% to 100%). Wash, rinse, repeat.

[HengHeng]

June 23 (Bloomberg) -- Speculators became the largest players in oil futures markets, nearly doubling their share in the past eight years as prices rose to records, in a ``radical shift'' for the market, according to a congressional committee.

In January 2000, speculators controlled 37 percent of contracts to buy West Texas Intermediate crude oil on the New York Mercantile Exchange, with the rest held by physical hedgers, including refiners and airlines that need to hedge against delivered fuel costs.

By this April, speculators controlled 71 percent of the contracts, according to data provided to the House Energy and Commerce Committee by the Commodity Futures Trading Commission.



Basically , i'm pretty sure something would happen sooner or later and all these speculators would get caught sooner or later. Expecially when more and more participants ... it would time to catch people.