Falklands : Hydrocarbons Weekend Record: 11 to 13 May 2007
Submitted by Falkland Islands News Network (Juanita Brock) 14.05.2007 (Article Archived on 28.05.2007)
A look back at last week's statistics and analysis.
HYDROCARBONS WEEKENDRECORD 11 TO 13 MAY 2007
Compiled by J. Brock (FINN)
WEEKEND DEVELOPMENTS
(Russia)
Gazprom has reached a final agreement with its Kazakh partners on the terms of a joint venture at the Orenburg gas refinery, CEO Alexei Miller said on May 10.
(Kenya)
Kenya will host the 11th African Oil Gas, Trade and Finance Conference with the theme; 'Interface between Hydrocarbons and Finance.' Energy Minister, Kiraitu Murungi announced on Saturday. The three-day conference from May 23-24 will focus sharply on oil price volatility, and mitigating environmental and social consequences of hydrocarbon development. Main players in the region should see an opportunity to forge mutually beneficial partnerships and ventures. This is East Africa’s first ever global conference.
(Bolivia and Brazil)
Bolivia’s President, Evo Morales, has announced that he has reached a deal with Brazil’s President Luiz Inacio "Lula" da Silva to buy back Bolivia's only two oil refineries from Brazilian state oil company Petrobras. Bolivia’s agreed to pay $112 million to re-buy the refineries, meeting Petrobras’ demands to compensate the company for its original purchase price and investments to modernise the refineries.
LAST WEEK’S CRUDE PRICES
Monday, 07 May 2007: Light Sweet Crude was trading at $61.52 down 41 Cents on the New York Mercantile Exchange and Brent Crude was trading at $64.12 down $1.19 on London’s Ice Futures Market.
Tuesday, 08 May 2007: Light Sweet Crude was trading at $62.26 up 79 Cents on the New York Mercantile Exchange and Brent Crude was trading at $65.54 up $1.10 on London’s Ice Futures Market.
Wednesday, 09 May 2007: Light Sweet Crude was trading at $61.55 down 71 Cents on the New York Mercantile Exchange and Brent Crude was trading at $64.78 down 76 Cents on London’s Ice Futures Market.
Thursday, 10 May 2007: Light Sweet Crude was trading at $61.81 up 26 Cents on the New York Mercantile Exchange and Brent Crude was trading at $65.79 up 59 Cents on London’s Ice Futures Market.
Friday, 11 May 2007: Light Sweet Crude was trading at $62.10 up 29 Cents on the New York Mercantile Exchange and Brent Crude was trading at $66.80 up 81 Cents on London’s Ice Futures Market.
ANALYSIS:
Monday, 07 May 2007: Prices decreased today because reports have indicated that refinery output for gasoline has increased. Inventory reports are also reported to increase. It is not known whether these reports are from analysts or other officials from the US Department of Energy Administration. Thanks to a survey by Bloomberg.com we now know that OPEC has increased production. And. this has also helped crude prices to decrease today.
Tuesday, 08 May 2007: As expected, rebels in Nigeria bombed three major oil pipelines and this helped to increase the price of crude today. There is also a debate in the US as to whether refineries are cutting back production to increase the price of gasoline.. At present refineries are running at approximately 88% capacity and some are saying that the oil industry made enough last year to maintain refineries and to repair the remaining damage caused by hurricanes Katrina and Rita in 1985. Refinery representatives are saying that there are not enough qualified people to maintain the refineries, let alone complete repairs after hurricanes Katrina and Rita. At present in the US gas prices hover around $3.07 per gallon – higher than last year’s summer drive season. Analysts say that prices could go as high as $4.00 per gallon.
Wednesday, 09 May 2007: A rise in crude and gasoline inventories in the United States has helped to decrease the price of crude today.
Thursday, 10 May 2007: Nigeria’s rebels are ensuring higher oil prices and, yet again, they have taken hostages. This time they have seized oil workers in the delta. Supply concerns have also helped to increase the price of crude today. Up and coming “worries” include the hurricane season, due to materialise around 01June – if not before. No one wants a repeat of last year’s troubles in the mid-east but that main factor could raise crude prices through the roof.
Friday, 11 May 2007: Added to unrest in Nigeria, IAEA supply worries have caused the price of crude to increase today. It is thought that geopolitics and supply worries will help to ratchet prices higher over the summer drive season.
A BRIEF INVENTORY REPORT FOR THEWEEK ENDING 04 May 2007
Gasoline: up 400,000 barrels to 195.3 million barrels
Crude: up 5.6 million barrels to 341.2 million barrels
Distillates: up 1.7 million barrels
Refinery capacity: 89%
INTERNATIONAL DEVELOPMENTS
(Kenya Conference)
Many African news agencies report that Kenya will host the 11th Africa Oil and Gas, Trade and Finance Conference. The conference is due to start in Nairobi on May 23rd at the Kenya International Conference Centre. The Ministry of Energy an the United Nations Conference on Trade and Development and National Oil Corporation of Kenya are organising the conference. Energy Minister, Mr Kiraitu Murungi said the conference will offer the oil and gas industry an opportunity to gather knowledge and network with key people from the industry. Delegates will focus on the 'interface between hydrocarbons and finance' and will provide Kenya an opportunity to demonstrate its potential to oil exploration companies.
(OPEC)
The Organisation of Petroleum Exporting Countries (OPEC) reports that crude oil production increased by 50,000 barrels per day (bpd). Several news agencies report that output now averages 30mn bpd. According to the survey of oil companies by Bloomberg, production in March was revised to 29.5mn bpd from 29.88mn estimated last month. The 10 members of OPEC with production quotas, all except Angola and Iraq, raised output by 30,000 barrels to 26.41million bpd.
(Alternative Fuel)
U.S. scientists are working to make hydrogen more stable and cost efficient than fossil fuels. Carnegie Mellon University researcher David Sholl In an interview with Science Daily, says that increased concern about global warming and a need to conserve natural fuel sources prompted him to begin his search for lightweight, low-cost hydrogen-storage materials. Hydrogen vehicles have been tested with great success, however it takes electricity to make hydrogen and its increased production could make us seek alternative methods for energy generation
REGIONAL DEVELOPMENTS:
(Colombia)
Colombia’s Minister of Foreign Affairs Fernando Araújo and his Venezuelan counterpart Nicolás Maduro met today in Bogotá to discuss bilateral issues about energy, security and trade. During their meeting, the ministers discussed the undertaking of Presidents Álvaro Uribe of Colombia and Hugo Chávez of Venezuela during the first South American energy summit held recently in Margarita island.
(Argentina)
Extract from a Press Release
Apco Argentina Inc. has announced net income for the three-month period ended March 31, 2007, of $7.7 million, or $1.05 per share. This represents a 14 percent decrease compared with net income of $9 million, or $1.22 per share, for the comparable period in 2006.
The $1.3 million decrease in net income is due to lower average oil sales prices, higher operating expenses, an increase in exploration expense resulting from three-dimensional seismic images acquired over the Las Violetas and Angostura concessions and export taxes related to its concession interests in Tierra del Fuego. These items more than offset the benefit of greater operating revenues from increased oil and natural gas sales volumes for the period compared to the first quarter of 2006.
The increase in Argentine taxes other than income is due to higher export taxes resulting from the Argentine government's recently enacted law that applies export taxes to exports from the province of Tierra del Fuego. The export tax did not apply to the province of Tierra del Fuego in the first quarter of 2006. Apco Argentina Inc. Summary of Earnings (In Thousands of Dollars Except Per Share Amounts) Three months ended March 31 2007 2006 Operating revenue 14,194 13,020 Investment income 5,436 5,625 Net income 7,694 8,976 Per share 1.05 1.22
Source: Apco Argentina Inc
The Argentine branch of Brazilian state owned energy company, Petrobras, has reported lower-than-expected first-quarter profits as higher costs eroded flat sales. The Buenos Aires Stock Exchange has announced that the local ranch, Petrobras Energia Participaciones announced that revenue fell to 182 million pesos from 365 million pesos reported last year.
In other Argentine Hydrocarbons news, Spanish oil major Repsol YPF has announced that it is considering selling a stake in its Argentine unit YPF to a local partner. Repsol wanted to float between 15 and 20 percent of YPF on the Argentine market but changed its mind, saying market conditions were not right at this time.
(Bolivia and Brazil)
Petrobras has announced a reduction in the price it is asking to transfer two refineries it owns in Bolivia that were taken up in the Nationalisation on 01 May 2006. Jose Fernando de Freitas, Petrobras' Bolivian chief, his company offered to sell the two plants to the Bolivian government for 112 million U.S. dollars, 30% less than the 160 million dollars it offered last week.
Petrobras has discovered gas in Espírito Santo well Brazil according to an announcement issued on Wednesday. The exploration arm of Petrobras has discovered gas in the Espírito Santo basin's 6-ESS-168 well.
Brazil’s state owned energy company, Petrobras, has called for negotiations about the two refineries which it lost when Bolivia nationalised its hydrocarbons industry. Company's President Jose Sergio Gabrielli said on Monday that he hoped the matter would be resolved rather than taking it to the International Court of Justice. Petrobras has been asking for $200 Million for two refineries nationalised by Bolivia’s government on May 1, 2006. According to Mr. Gabrielli, Bolivia’s offer of only 60 million dollars is not enough. Petrobras acquired the two refineries in Cochabamba and Santa Cruz in a 1994 for $104 Million.
RELEVANT SHARE PRICES:
MONDAY, 07 MAY 2007:
TLW: 364.00 unchanged, DES: 25.00 unchanged, FOGL: 88.00 unchanged, RKH: 39.00 unchanged, BOR: 25.00 unchanged
TUESDAY, 08 MAY 2007:
TLW: 358.75 down 5.75, DES: 25.00 unchanged, FOGL: 89.00 up 1.00, RKH: 39.00 unchanged, BOR: 24.25 down 1.25
WEDNESDAY, 09 MAY 2007:
TLW: 355.00 down 4.00, DES: 25.25 up 0.25, FOGL: 88.50 down 0.50, RKH: 37.50 down 1.50, BOR: 24.25 unchanged
THURSDAY, 10 MAY 2007:
TLW: 355.00 unchanged, DES: 25.75 up 0.50, FOGL: 87.50 down 1.00, RKH: 38.50 up 1.00, BOR: 24.25 unchanged
FRIDAY, 11 MAY 2007:
TLW: 352.50 down 2.50, DES: 25.75 unchanged, FOGL: 87.50 unchanged, RKH: 38.50 unchanged, BOR: 23.75 down 0.50
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