News Column

In Brief

May 5, 2014

Shell earnings fall on impairments   LONDON: Royal Dutch Shell reported its first-quarter earnings almost halved from a year ago to $4.5 billion, mainly due to a $2.9 billion charge reflecting impairments related to refineries in Asia and Europe. "There are substantial pressures on the industry from excess capacity, changing product demand, and new oil supplies from liquids-rich shales," chief executive Ben van Beurden said.

Taqa to price $750m bond   ABU DHABI: Abu Dhabi National Energy Co (Taqa) is due to price a $750 million bond with a 10-year lifespan, arranging banks said, with interest from investors covering the size of the transaction more than three times. Order books for the deal are close to $2.5 billion, a document from lead managers said. 

Total Q1 net down 10pc on refining   PARIS: French oil major Total reported a 10 per cent drop in first-quarter net profit to $3.3 billion, dragged down by shrinking margins at its European refineries and a drop in oil and gas output. "The impact of sharply lower European refining margins was limited thanks to the implementation of performance improvement plans by the segment," CEO Christophe de Margerie said.

Aker Q1 profit in line with forecastsOSLO: Oil services firm Aker Solutions reported first-quarter earnings in line with expectations and said it continues to see healthy demand for most of its products and services. The firm's earning before interest, taxes, depreciation and amortisation rose 37 per cent to 1.05 billion crowns ($175 million), just a touch shy on expectations for 1.1 billion crowns. Its order backlog meanwhile totalled 55.6 billion crowns versus expectations for 55.7 billion crowns, according to a Reuters poll of analysts.

Petronas sells gas project stake KUALA LUMPUR: Malaysia's state oil firm Petroliam Nasional (Petronas) said it will sell 15 per cent of its Canadian shale assets in northeastern British Columbia to China Petrochemical Corp (Sinopec). China's largest petrochemical producer will absorb 1.8 million tonnes of liquefied natural gas from the facility's annual production for at least 20 years, Petronas said.

Angola LNG shutLUANDA: Angola's new liquefied natural gas (LNG) plant has been forced to shut down production due to unspecified technical problems, a spokesman said on Friday, but he denied a report of an explosion at the plant.

The spokesman also said it was not yet known when production will be resumed. The $10 billion Angola LNG plant, operated by Chevron, has struggled to boost output since starting up last year and has suffered setbacks including a compressor leak, a rig capsize, electrical fires, and pipeline leaks.

EnergySolutions sues agencyLONDON: EnergySolutions said it was taking Britain'sNuclear Decommissioning Authority (NDA) to court after losing out on a $12 billion contract to decommission the country's oldest nuclear sites.

EnergySolutions, the incumbent manager of 10 nuclear sites, told Reuters it had filed the lawsuit in a British High Court.

The company had asked the NDA earlier this month to explain why it had awarded Texas-based Fluor and engineering company Babcock BAB.L preferred bidder status for what is one of Britain's largest-ever government outsourcing contracts. 

Oleo e Gas gets $44m offerRIO DE JANEIRO: Oleo e Gas Participacoes, the bankrupt oil company controlled by Brazilian tycoon Eike Batista, received a $44 million offer for five oil exploration and production blocks in Colombia, the company said. The offer involves $30 million in cash and the assumption of $14 million in future exploration obligations in Colombia, Oleo e Gas said in a statement. It did not give the name of the investor or company making the offer. Oleo e Gas was formerly known as OGX Petroleo e Gas Participacoes.

Pemex crude output falls MEXICO CITY: Crude oil production from Mexico's state-run oil company Pemex totalled 2.469 million barrels per day (bpd) in March, the company said, marking the lowest level of output since the 1990s. The level of crude production in March was the lowest level of monthly output since June 1990, according to energy ministry data, excluding a single month in 1995 when output was down by more than 800,000 due to Hurricane Roxanne.

BP to hang on to stake in Rosneft BPLONDON: British oil major BP said it intends to remain a long-term investor in Russia's Rosneft following a decision by the US government to impose sanctions against the head of the Russian energy company.

"We are committed to our investment in Rosneft, and we intend to remain a successful, long-term investor in Russia," a BP spokesman said. He added the company, which holds a 19.75 per cent stake in Rosneft, is now considering what the US sanctions announcement means for BP's business.

ExxonMobil to start up units NEW YORK: ExxonMobil said it is going to start up unspecified units undergoing planned maintenance at its 149,500-barrel-per-day (bpd) refinery in Torrance, California.

The company said that it expected the scheduled maintenance at the refinery to last several weeks. The refinery has warned of flaring between in a notice with the South Coast Air Quality Management District. The potential flaring is related to start-up of units undergoing planned maintenance, an email from the company said.

Gazprom's net income seen down MOSCOW: Russia's top natural gas producer Gazprom is expected to report 2013 net income down 3 per cent to 1.14 trillion roubles ($35.7 billion) due to a weaker rouble and write-offs, an analyst poll showed.

Gazprom usually reports later than other major Russian companies and analysts have said they will focus on a post-results conference call for updates on the company's position on Ukraine's gas debt, talks on a gas supply deal with China, plans for gas exports to Europe and liquefied natural gas projects.

Consortium not expecting oil ASTANA: A consortium developing Kazakhstan's huge Kashagan oilfield said it did not expect to produce oil in the offshore field this year due to leaking pipelines.

"The current assessment, based on the results of an investigation, is that both the oil and the gas pipelines might have to be fully replaced," the consortium also said. The North Caspian Operating Company (NCOC) consortium includes Eni, ExxonMobil, Royal Dutch Shell, China's CNPC, Japan'sInpex and Kazakh state-run KazMunaiGas.

Linde, Neste to invest in PorvooHELSINKI: German industrial gases maker Linde will build a hydrogen production unit at Neste Oil's Porvoo, southern Finland, refinery, Neste Oil said.

Linde's AGA unit will construct the plant and Neste Oil will build the connections to the refinery, Neste said, adding the total value of the investment was around 100 million euros ($138 million).

Ophir not interested in PremierLONDON: London-listed oil and gas explorer Ophir Energy said it was no longer interested in making a takeover offer for rival Premier Oil after a proposal was rejected by the Premier Oil board.

"Ophir confirms that it is no longer considering making an offer for Premier," the company said in a statement.

Output from biggest block resumesLIMA: Pluspetrol, the Argentine energy company, said it was resuming production at Peru's biggest oil block after reaching an agreement with native communities that had occupied facilities there.

Output from block 1-AB in Peru's upper Amazon had fallen by 70 per cent after indigenous protesters took control of oil tanks, roads and a thermoelectric plant in the Amazonian region of Loreto, the company said. But since a deal was struck over the weekend, protesters have withdrawn, the company said.

Phillips plant restarting unitsHOUSTON: Phillips 66's 252,000 barrel per day (bpd) Alliance, Louisiana, refinery began restarting units after completing a planned overhaul that stretched over six weeks, sources familiar with operations at the refinery said.

The restart is expected to be complete within two weeks with all units, including the refinery's 250,000 bpd crude distillation unit (CDU) back to planned production levels.

A Phillips spokesman said that planned maintenance was continuing at the Alliance refinery south of New Orleans.

Rig salvage work to finish by 2015MILAN: Salvage work to remove a capsized rig lying in shallow waters offshore from Angola's new liquefied natural gas (LNG) export plant should be completed by March 2015, the company in charge of the operation said.

The three-legged Perro Negro 6 drilling rig overturned last summer as it was being positioned to bore a tunnel for a gas pipeline key to feeding the $10 billion plant. Italian oil services firm Saipem chose South African company Smit Salvage, a unit of Netherlands-based dredging specialist Boskalis, to remove its rig.

Suncor Q1 profit rises on oil pricesCALGARY: Suncor Energy, Canada's largest oil and gas company, said its first-quarter profit rose 36 per cent on strong oil prices and a lower Canadian dollar. The company, Canada's dominant oil sands producer, reported net income of C$1.49 billion ($1.35 billion), or C$1.01 per share, up from C$1.09 billion, or 72 Canadian cents, in the first quarter of 2013.

Qatari fund buys UK oil firmLONDON: British oil company Heritage Oil agreed a 924 million pound ($1.6 billion) takeover offer from a fund owned by the former chief executive of Qatar's sovereign wealth fund.

Heritage, whose main oil production is in Nigeria, said it was recommending a 320 pence per share cash offer, which represented a 25 per cent premium to its closing price the day before the approach was announced.

Its suitor, Al Mirqab Capital, is the private investment vehicle of Qatar's Sheikh Hamad Bin Jassim Bin Jabor Al Thani and his family.

Sheikh Hamad, who was chief executive of the Qatar Investment Authority until last year, is regarded as the driving force behind the emergence of the state's sovereign wealth fund as one of the world's most sought-after investors, scooping up stakes in bluechip companies, luxury brands and prime real estate.

Iran gasoline prices surgeDUBAI: Gasoline prices in Iran leapt by up to 75 per cent at midnight, as state subsidies were cut, a risky move that President Hassan Rouhani hopes will improve an economy battered by Western sanctions.

The price hikes will test Rouhani's support among a population fed up with the high inflation that he has pledged to reduce as he pursues talks with world powers aimed at ending sanctions imposed over Iran's nuclear programme.

Iranians rushed to the pumps to fill their cars before the price surge, but there were no immediate reports of unrest, unlike in 2007 when there were riots at some gas stations when cheap fuel was rationed for the first time.

"We have been preparing for two months to implement these plans in provinces, cities and rural areas," state news agency Irna quoted Interior Minister Abdolreza Rahmani Fazli as saying.

PetroRabigh restarts unit

AL KHOBAR: Saudi Arabia's PetroRabigh has restarted a vacuum gas oil treatment unit after maintenance, the company said. Work on the unit, which lasted a month from March 27, was originally due to finish on April 19 but was extended by a week.

PetroRabigh a joint venture between state oil giant Saudi Aramco and Japan'sSumitomo Chemical said the VGO and related units were brought back into operation on April 25.

Kuwait adopts solar projectKUWAIT: Kuwait Foundation for the Advancement of Sciences (KFAS) has adopted a pilot project using the systems of photovoltaic cells to generate solar power in 150 houses, said a report.

The project is part of KFAS' new strategy which focuses on contributing to the application of scientific solutions to address priority issues, including water, energy and the environment for the best interest of the country, said Kuna. It aims to reduce the loads on the electrical grid and maintaining the oil resources by burning less fuel in the production of electrical power, especially in peak times as a result of the use of the photovoltaic cells as well as the reduction of environmental impacts due to emissions of greenhouse gases.

Once the project gets completed in the next three years, 7,027 barrels of oil would be provided every year worth up to KD221,000 ($784,718), anticipating multiplication of this value in the peak hours.

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Source: Oil & Gas News