Falklands : Hydrocarbons Daily Record (25/09/06)
Submitted by Falkland Islands News Network (Juanita Brock) 26.09.2006 (Article Archived on 10.10.2006)
Crude prices have dropped $18.00 since their highest recorded price. Now they are at a six-month low.
HYDROCARBONS DAILY RECORD: MONDAY, 25 SEPTEMBER 2006
By J. Brock (FINN)
At 1800 LMT Monday, 25 September 2006 Light Sweet Crude gained .90 Cents to stand at $61.95 and Brent Crude gained .31 Cents to stand at $60.80.
TRENDS
The major reasons for the $18.00 a barrel drop in the price of Crude since 14 July 2006 when it reached an all-time high of $78.14 is the decreased demand for gasoline in the United States. What keeps it from dropping lower is the demand for hydrocarbons products in the People’s Republic of China. The price of gasoline in the United States has dropped .24Cents in two weeks and has dropped more than .50 Cents since mid July when crude prices were at their peak.
Other trends keeping a tab on prices include the dieing down of rhetoric over Iran’s desire to enrich nuclear fuel for energy generation and the ceasefire in Lebanon.
THE MARKETS
FTSE
At the close of play today, the FTSE 100 was down 23.98 points to settle 5,798.30 and the FTSE 250 fell 28.19 points to end at 9,755.80. FTSE Small Cap closed down 1.10 points to settle at 3,486.60.
DOW JONES AND NASDAQ
Wall Street gained back some of its losses today due to the fact the housing market, while slowing down, is taking its time to bottom out.
At the end of play today the Dow Jones Index gained 67.71 points or 0.59% to settle at 11,575.81 and the NASDAQ closed up 30.14 or 1.36% to settle at 2,249.07.
DEVELOPMENTS:
(United Kingdom and Australia)
Tullow Oil Company and Hardman Resources have announced on Monday that Tullow Oil will buy Hardman Resources of Australia for around $1.1Billion. The press release describes the relationship between Tullow and Hardman as rival and partner.
In Australian currency the offer price of A$2.02 per share is a 54% premium to Hardman Resources closing share price of A$1.3.
The offer also includes an option of issuance of 0.22289 new shares of Tullow Oil for each share held in Hardman Resources, up to a maximum of 65 million new shares. Tullow Oil said that the acquisition will increase its total production by 6,000 barrels per day while raising its reserves by 30%. Hardman Resources has interests in Mauritania, Uganda, Tanzania, the Falkland Islands and Guyana.
(United Kingdom and Albania)
London-based MedOil, an oil and gas exploration company, plans to search for oil in the Ionian and Adriatic Seas. In an agreement signed this month by Albanian Minister of Economy, Trade and Energy Genc Ruli and Executive Director of MedOil Joseph McKniff, three phases of searches within seven years at a cost of 20.3m euros.
Focusing mainly on exploration in Southern Europe and North Africa, MedOil is allowed to work within the so called 'Joni-5' offshore, approximately 2,500 sq km of seafloor off southern Albania extending to the northern boundary of Greece. MedOil's initial obligation is for 400 sq km of a 3-D seismic work programme in the first two year period, with a minimum work expenditure of 1.6m euros. The agreement will be presented for ratification by Albania’s Council of Ministers in late October.
DEVELOPING REGIONAL FACTORS
(Argentina)
Instead of breaking away from the group, Argentina has opted to ally with its South American neighbours on a variety of issues including hydrocarbons. In a recent article in LaNaceon President Kirshner stated that it wanted to downgrade business relationships with the US as well as the giving the United Kingdom a difficult time over sovereignty rights in the Falkland Islands. It stands to benefit from new international infrastructure funded, in part, by money from the People’s Republic of China as well as from any hydrocarbons it finds in waters offshore in the South Atlantic Ocean. Leaving the rhetoric aside, it makes economic sense to go into business with ones neighbours.
(Cuba and Venezuela)
Cuban leader Fidel Castro on Sunday vilified the United States for detaining Venezuelan Foreign Minister Nicolas Maduro. In a statement, strongly condemning the incident, Castro, described it as a "coarse provocation." He described the detention as "an unacceptable violation" of the Vienna Convention and of the U.S. obligations as the headquarters of the United Nations (UN). On Saturday Foreign Minister Maduro said he had earlier been detained for more than 90 minutes in a room at John F. Kennedy International Airport in New York and his travel documents had been seized. He believed it was U.S. vindictiveness for Venezuelan President Hugo Chavez's speech at the UN General Assembly in which he called U.S. President George W. Bush "the devil." The U.S. Homeland Security Department at first denied Maduro had been mistreated, but later the U.S. State Department apologized for the incident. Maduro and the Venezuelan government rejected the apology and demanded a UN inquiry into the incident. Venezuela wants to wean itself out of supplying crude to the US and is seeking new markets for its oil. Half of Venezuela’s output goes to the United States.
(Falkland Islands)
It is thought that Argentina will ratchet up economic interference in the Falklands fisheries industry and cause problems setting up the Islands’ hydrocarbons industry when commercial quantities of oil and gas are exploited.
Share prices at the close of play on Monday, 25 September 2006
Desire Petroleum Plc was down 2.75 points or 7.48% on the day to settle at 34.00.
Falkland Oil and Gas Limited (FOGL) were down 1.50 or 0.41% on the day to stand at 105.00.
Rockhopper Exploration was unchanged on the day to settle at 43.00.
Borders & Southern ended down 2.00 or 4.44% on the day to stand at 43.00
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