Falklands : Hydrocarbons Daily Record Tuesday, 18 March 2008
Submitted by Falkland Islands News Network (Juanita Brock) 19.03.2008 (Article Archived on 02.04.2008)
Crude prices increased today on the back of a huge FED bail-out.
HYDROCARBONS DAILY RECORD TUESDAY, 18 MARCH 2008
By J. Brock (FINN)
At 1930hrs LMT on Tuesday, 18 March 2008 Light Sweet Crude was trading at $108.78 up $3.10 on the New York Mercantile Exchange. Brent Crude was trading at $105.56 up $3.81 on London’s ICE Futures Market.
ANALYSIS:
Yet again investors in crude futures caused crude prices to increase as the FED lowered interest rates by 3 quarters of one percent and lent funds to purchase a bank in trouble. The trend seems to be that each time the Government cuts rates and bails out businesses investors get their cut by first shedding shares and lowering the price, then re-investing when the official announcements are released. You and I pay for it when prices for nearly everything we buy go up, with our incomings remaining the same or decreasing. Thus far there aren’t massive job losses but this is about to change with companies struggling to pay overheads that are energy related as well as for supplies with energy costs added on.
(Related Story)
Oil prices rebounded Tuesday as a rally on Wall Street and the prospect of a large interest rate cut drew buyers back to the futures market. Retail gas prices, meanwhile, slipped slightly for the second day in a row, while diesel prices rose further above $4 a gallon.
http://ap.google.com/article/ALeqM5i5TtajgUpSm7KY5jf-lCJGHBB-tAD8VFUIS01
SHARE PRICES AND THE MARKETS:
SHARE PRICES ON THE ALTERNATIVE INVESTMENT MARKET: Tuesday, 18 March 2008.
TLW: 651.50 up 22.50, DES: 71.00 up 3.75, FOGL: 126.00 up 1.00 RKH: 83.00 unchanged, BOR: 57.50 down 2.25 PRE: 12.50 down 0.50, GBP: 7.38 unchanged GPK: 406.00 unchanged, BLT 1515.00 up 50.00 RDSA: 1719.00 up 36 RDSB: 1680.00 up 34.00
New York Stock Exchange:
XOM: 88.47 up 2.68 (USD)
THE MARKETS (18/03/08)
FTSE100: 5,605.80 up 191.38, FTSE250: 9,601.50 up 220.77 SmallCap: 3,019.10 up 5.95
DJI: 12,392.66 up 420.41 NASDAQ: 2,268.26 up 91.25 S&P500: 1,330.74 up 54.14
INTERNATIONAL AND REGIONAL DEVELOPMENTS:
(Argentina Bolivia and Spain)
Spanish oil company Repsol YPF plans to invest more than $1 billion in Bolivia over the next few years, the head of the firm's Bolivian operations said here.
http://www.tradingmarkets.com/.site/news/Stock%20News/1216089/
(Argentina and Spain)
The decision of Madrid-based Repsol YPF (Europe’s fifth biggest integrated oil and gas company by market capitalization) to sell up to 45 percent of YPF, its Argentine subsidiary, is the crux of a strategic shift to diversify business out of its core South American operations.
http://www.energytribune.com/articles.cfm?aid=823
(Bolivia and Russia)
Russian state-owned energy giant Gazprom has signed an agreement with Bolivian state petroleum company YPFB giving the Russian company access to the projects on natural gas exploration and production in this South American country. In the framework of the deal Gazprom and YPEB will create a joint venture in which YPEB will have the majority stake.
http://www.russia-ic.com/news/show/5967/
(Brazil)
Royal Dutch Shell PLC (RDSA) may start getting into ethanol production in Brazil, the Gazeta Mercantil newspaper said Tuesday. The company has held talks with ethanol millers in the Latin American country and is researching ethanol projects together with the State University of Campinas in Sao Paulo state, the newspaper said.
http://www.cattlenetwork.com/content.asp?contentid=206244
Daniel Rocha, head of Chevron Brazil, said on Tuesday during the Latin Upstream conference in Rio de Janeiro that production at Frade, in which Chevron has a 51.7 percent stake, should start in January after a floating production, storage and offloading (FPSO) unit arrives.
http://www.reuters.com/article/rbssEnergyNews/idUSN1823371820080318
(Brazil and Canada)
Rutter Inc. (TSX: RUT) is pleased to announce that its 74% owned Brazilian subsidiary, Unicontrol International Ltda., has been awarded a $7.9 million (CAN) contract related to FSTP Brasil Ltda.'s construction of the P-56 FPSO (Floating Production Storage and Offloading vessel). The terms of the contract call for Unicontrol to design and build the ECOS Integrated Control and Safety System for the Petrobras P-56 FPSO. The contract also has an option for commissioning and training with a value of $935,000 (CAN).
http://www.newswire.ca/en/releases/archive/March2008/18/c5239.html
(Uruguay and Iran)
Iran is showing interest in building a cement plant in Uruguay and signing an agreement with that South American nation based on the exchange of oil for rice, reported El Pais daily on Monday. The president of the National Administration of Fuel, Alcohol, and Portland (ANCAP), Raul Sendic, said that the proposals are under study.
http://www.plenglish.com/article.asp?ID=%7B04CC8576-B7A4-4BAC-A247-6797BAE2B5F5%7D)&language=EN
(Venezuela)
More recently, PDVSA abruptly ceased permitting customers the usual 30 days to pay for oil and started demanding payment within a week after shipment. This new practice has brought to light the cash shortage afflicting PDVSA — a shortage aggravated by the fact that contractual disputes with Exxon Mobil and other oil companies have caused tribunals in London, New York, and the Netherlands' Antilles to freeze PDVSA assets.
http://www.petroleumworld.com/Lag08031801.htm
Exxon had convinced an English court to freeze the assets of Venezuela's state oil company, PDVSA, in January so cash would be available if Exxon won an ...
http://www.guardian.co.uk/feedarticle?id=7395230
In a year when domestic crude oil output continued to decrease and fuel demand in the domestic market climbed, Venezuelan oil exports were seriously hit, dropping 192,000 bpd (6.4 percent) to 2.78 million bpd in 2007.
http://english.eluniversal.com/2008/03/18/en_eco_art_venezuelan-oil-expor_18A1442001.shtml
The victory by Petroleos de Venezuela state oil company in a London court against US Exxon Mobil Corporation was a lesson of dignity and firmness, Energy Minister Rafael Ramirez asserted on Tuesday.
http://www.plenglish.com/article.asp?ID=%7BFF19188F-5F11-4474-97D4-9770EE72CC97%7D)&language=EN
LOCAL DEVELOPMENTS:
It's not easy to put a conventional valuation on the Falklands prospectors, such as a multiple of forecast earnings or net present value, because they are at such an early stage. Indeed, between them they're yet to even sink a well. However, a 'quick and dirty' method of assessing valuation is to divide enterprise value (EV- market cap plus debt minus cash) by a so-called 'P50' estimate of the number of barrels of oil that could potentially gush out from their prospects. This tells investors what value is being put on each notional barrel of oil that an explorer may eventually produce.
http://www.investorschronicle.co.uk/MarketsAndSectors/Sectors/article/20080318/36b40698-f417-11dc-96a0-0015171400aa/A-crude-yardstick.jsp
Shares in Aim-quoted Desire Petroleum took off recently on news that it has recruited a farm-in partner to help fund the considerable cost of mobilising a drilling rig to explore three oil prospects offshore of the Falkland Islands. Shares in fellow Falklands explorers Rockhopper Exploration and Borders & Southern Petroleum also rose strongly, on hopes that all will benefit from having a rig in the remote South Atlantic region. But the reality is not that simple.
http://www.investorschronicle.co.uk/MarketsAndSectors/Sectors/article/20080318/9a11e20e-f427-11dc-96a0-0015171400aa/Rigging-the-Falklands-oil-race.jsp
LOCAL LINKS:
http://www.fogl.com
http://www.desireplc.co.uk
http://www.bordersandsouthern.com
http://www.rockhopperexploration.co.uk.
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