Falklands : Hydrocarbons Weekend Record: 20 to 22 April 2007
Submitted by Falkland Islands News Network (Juanita Brock) 22.04.2007 (Article Archived on 06.05.2007)
A look back over some of last week's developments and analysis in hydrocarbons industry.
HYDROCARBONS WEEKEND RECORD: 20 TO 22 APRIL 2007
By J. Brock (FINN)
WEEKEND DEVELOPMENTS
(International - Sudan)
British oil company, White Nile, announced on Friday that it has begun drilling its first well in its 67,000 square km concession in Southern Sudan. Total SA, a French energy company, disputes White Nile's contract with southern Sudan’s government. White Nile has been given part of an oil exploration block that the central government in Khartoum had allocated to Total.
(Regional - Argentina)
According to the IHS Calendar, the Government of the Argentine Province of Salta has announced the launch of exploration tenders for 11 blocks in Argentina Northwest. Salta province is selling bidding rules for exploration of 11 blocks.
WEEKDAY CRUDE PRICES
Monday, 16 April 2007: Light Sweet Crude traded at $63.61 down 2 Cents on the New York Mercantile Exchange and Brent Crude was trading at $67.25 down $1.38 on London’s Ice Futures Market.
Tuesday, 17 April 2007: Light Sweet Crude traded at $63.10 down 51 Cents on the New York Mercantile Exchange and Brent Crude was trading at $65.93 down $1.32 on London’s Ice Futures Market.
Wednesday, 18 April 2007 Light Sweet Crude traded at $63.13 up 3 Cents on the New York Mercantile Exchange and Brent Crude was trading at $66.15 up 22 Cents on London’s Ice Futures Market.
Thursday, 19 April 2007: Light Sweet Crude traded at $61.82 down $1.30 on the New York Mercantile Exchange and Brent Crude was trading at $65.94 down 10 Cents on London’s Ice Futures Market.
Friday, 20 April 2007: Light Sweet Crude Traded at $63.18 up $1.35 on the New York Mercantile Exchange and Brent Crude was trading at $66.49 up 55 Cents on London’s Ice Futures Market.
ANALYSIS
Monday, 16 April 2007: Though there are tensions in Nigeria a volatile trading day ended with the decline of crude prices. Reassurances about gasoline supplies have tipped the price indicators downwards.
Tuesday, 17 April 2007: Reassurances about gasoline supplies have tipped the price indicators downwards today. Wednesday’s report is expected to be more positive.
Wednesday, 18 April 2007: Analysts’ predictions that gasoline production in the US would decrease by 1.5 Million Barrels were wrong and this caused the price of crude to increase today.
On the horizon is the hurricane season due to begin on 01June. It is not clear whether this will be an El Nino year (2006 was an El Nino year) or a La Nina year (2005 was a La Nina year). This will not be known until the end of May. It is the sea conditions in the western Pacific Ocean that dictates whether the US Gulf Coast will or will not be in the path of hurricanes. refineries located in the US Gulf coast suffered severe damage during the 2005 hurricane season, a factor in the increase of crude prices that year.
Thursday, 19 April 2007: Iraq has twice the oil than estimated according to an IHS report. This helped to decrease the price of crude today. The report is in direct contrast to speculation that the world is running out of oil reserves.
Friday, 20 April 2007: Crude prices increased today due to fears about the elections in Nigeria – the world’s 6th largest producer of hydrocarbons. Allegations that the elections could be rigged have triggered the upward fluctuation in prices.
A BRIEF INVENTORY REPORT (Wednesday, 20 April 2007)
Crude: Inventory down by 1 Million Barrels to 332.4 Million barrels
Gasoline: Inventories of gasoline declined by 2.7 Million Barrels to .. This was far more than the expected decline by 1.5 Million Barrels.
Refinery Output: The Wednesday, 04 April report from the Department of Energy Administration stated that Refineries were operating at 87% of capacity. Today the report says that they are running at 89% capacity. This is 2 points above that mark and not the increase of 0.4% that analysts predicted.
INTERNATIONAL DEVELOPMENTS:
An Up and coming publication by IHS Inc., a global provider of critical technical information and consulting services, will feature the first and only detailed analysis of oil reserves, production and development opportunities developed since the start of the Iraq conflict. Information in the atlas indicates that Iraq has an extra 100 Billion barrels of oil reserves in its western desert, making that country’s total reserves second after Saudi Arabia.
REGIONAL DEVELOPMENTS:
FOGL’S agm: The Chairman’s Statement
In the period under review FOGL has made significant progress towards its objective of drilling the first exploration wells in the South and East
Falkland licences during 2008. Building upon the huge quantity of work that was previously carried out, FOGL has commenced two surveys, the results of which are expected to provide further definition and de-risking of the prospects and provide locations for drilling.
John Armstrong has decided to step down from his position as a non-executive Director of the Company effective 16th May 2007 in order to concentrate on his other business activities. John was the founding Chairman of the Company. The Board would like to take this opportunity to thank John for his invaluable input and contribution over the years as well as all his efforts to establish the Company in 2004. We wish him well in his new ventures.
The full report can be seen at http://www.fogl.com.
Borders & Southern Petroleum plc
Preliminary Results for the 18 months ended
31 December 2006
Borders & Southern Petroleum plc (or 'the Company') (AIM: BOR) is pleased to announce its preliminary results for the 18 months to 31 December 2006.
Highlights
• Borders & Southern has completed the processing and interpretation of its Falkland Islands 2D seismic data
• The Company has commissioned and completed a number of technical studies aimed at technical risk reduction
• A new fold belt play located to the south of the Falkland Islands has been defined, the heart of which is contained within the Company's 100% owned licensed area
• The size of the Company's lead inventory has increased significantly, and contains numerous structures capable of holding giant oil or gas accumulations
• The Company is currently assessing the design and cost of a focused 3Dseismic acquisition programme aimed at further risk reduction prior to drilling
• The management team is actively seeking to add new projects to its
portfolio that are consistent with its strategy and meet its stringent
screening criteria
• Cash balance as at 31 December 2006 was £9.47 million
Harry Dobson, Chairman of Borders & Southern, commented 'The Company is continuing to make great progress towards its objective of building a successful exploration and production business. The evaluation of the Falkland Islands licences has delivered really exciting results. The 2D seismic programme has produced some spectacular images of large structures within an undrilled fold belt and the subsequent mapping has defined numerous leads with the potential to hold substantial volumes of hydrocarbons.
Earlier last year we invited a small number of companies to review the data with the aim of becoming a joint venture partner. Discussions with some of these companies are ongoing. In the interim, we are continuing to maintain the pace of exploration, looking at ways to further reduce the technical risk with the clear intention of drilling the first well as soon as practical.
In addition to our Falkland Islands work we are currently reviewing additional frontier opportunities with large upside potential with the goal of building the Company's portfolio consistent with our strategy.'
For further information please visit www.bordersandsouthern.com or contact:
Howard Obee Simon Hudson / Clemmie Carr
Borders & Southern Petroleum plc Tavistock Communications
Tel: 020 7661 9348 Tel: 020 7920 3150
The full report can be seen at .
Bolivia and Argentina:
The supply of natural gas between Bolivia and Argentina is flowing again after Bolivian soldiers put down a pipeline take-over by protestors. The riot near a pipeline partly owned by Royal Dutch Shell Plc began when protestors took control of a major pumping station and ended after a protester was killed.
(South America)
A much awaited regional Energy Alliance is now a reality, with presidents of South American countries agreeing to it after a summit on Venezuela’s Margarita Island. Tuesday’s summit concluded with a consensus that a regional energy council should be created. This is a major development for the regional energy industry.
(Chile and Venezuela)
Venezuela and Chile have agreed to increase economic ties by forming a joint venture to develop Venezuela's Orinoco Belt. Petroleos de Venezuela SA and Chile's national oil company, Empresa Nacional de Petroleo, known as Enap have agreed to work together, to certify heavy-crude reserves in the Orinoco's Ayacucho Block 5. Venezuela’s President Chavez is pushing out four privately operated foreign joint ventures in favour of new joint ventures formed with other state firms. Among the new joint ventures are those from Argentina, Belarus, Brazil, Cuba, China, Iran and Russia.
RELEVANT SHARE PRICES:
RELEVANT SHARE PRICES:
Monday, 16 April 2007: TLW: 378.00 down 0.25, DES: 26.00 down -0.25 FOGL: 88.50 down 0.50, RKH: 35.00 Up 0.50, BOR: 27.50 down 0.25
Tuesday, 17 April 2007: TLW: 370.50 down 7.50, DES: 26.25 up 0.25, FOGL: 88.00 down 0.50, RKH: 35.00 Unchanged, BOR: 27.50 Unchanged
Wednesday, 18 April 2007: TLW: 365.00 down 5.50, DES: 26.00 down 0.25, FOGL: 88.00 Unchanged, RKH: 35.00 Unchanged, BOR: 27.50 Unchanged
Thursday, 19 April 2007: TLW: 362.25 down 2.75, DES: 24.75 down 1.25, FOGL: 88.00 Unchanged, RKH: 42.50 up 7.50, BOR: 27.50 Unchanged
Friday, 20 April 2007: TLW 365.25 up 3.00, DES 28.50 up 1.25, FOGL 88.00 Unchanged, RKH 42.00 Down 0.50, BOR 27.00 Down 0.50
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