Chavez Gets Arab, Latin Countries' Backing Versus ExxonMobil

Chavez Gets Arab, Latin Countries' Backing Versus ExxonMobil

A conglomerate of Arab and Latin American countries are putting their support behind Venezuela in the ExxonMobil row, claimed Venezuelan President Hugo Chavez on Feb. 22.
In a television address, Chavez said, "I want to give my thanks for the support given to Venezuela by the conference of Arab and Latin American foreign ministers that just concluded in Buenos Aires."
The Summit held in Argentina comprised of 30 countries. With a combined population of 800 million people, Arab League Secretary General Amir Moussa said the consortium represented "an enormous market with great possibilities."
We want to hear from you. Questions, opinions and suggestions are all welcomed by the Rigzone Staff. Write us at news@rigzone.com .

Oil Futures Hit $137 for 2015

Oil Futures Hit $137 for 2015

Barclays Capital, a division of Barclays Bank PLC located in the U.K., has upped its projected oil cost for the year 2015 from $93 a barrel to $137 a barrel after record high prices in oil futures this week.
In 2006 after oil reached a "record-high" $75 a barrel, Barclays had made the 2015 projection of $93 a barrel.
In a Barclays research note forecasting the spike in price, analysts noted that "the remorseless move up in long-run prices has not yet fully played out."
We want to hear from you. Questions, opinions and suggestions are all welcomed by the Rigzone Staff. Write us at news@rigzone.com .

Alaska progressing on gas line, FERC tells Congress

Alaska progressing on gas line, FERC tells Congress

Nick SnowWashington Editor
WASHINGTON, DC, Feb. 20 -- Alaska's selection of a preferred applicant to build a huge natural gas pipeline highlighted the Federal Energy Regulatory Commission's fifth progress report to Congress on the project.
It noted on Feb. 19 that the state chose TransCanada Pipelines Ltd. from five applicants under criteria set in the Alaska Gasline Inducement Act (AGIA), which the legislature passed and Gov. Sarah Palin signed into law in May 2007. TransCanada filed jointly with Foothills Pipe Lines Ltd. to build a line from Alaska's North Slope to TransCanada's hub in Alberta.
FERC Chairman Joseph T. Kelliher said the commission was pleased with the state's progress in choosing a preferred applicant since the federal energy regulator's last such report on Aug. 15. The 2005 Energy Policy Act contained a requirement for FERC to periodically submit reports to Congress on the project's progress.
"I am hopeful this will further encourage development of the Alaskan natural gas pipeline project, and FERC stands ready to act," Kelliher said.
ConocoPhillips Co. also submitted an application Nov. 30, which it acknowledged would not meet all of the requirements under AGIA but expressed hope that it would be considered anyway because it would bring initial gas to markets in mid-2018, according to FERC. Palin rejected it, saying the state would require all applicants to adhere to AGIA requirements.
Keep the project movingConocoPhillips said on Feb. 14 that it would reassess how best to advance the project as described in its application. "Despite the lack of progress with the State of Alaska, as an initial step ConocoPhillips will continue its planning and contracting efforts in preparation for a route reconnaissance and environmental studies starting in June 2008. It is important that we take advantage of this summer field season and keep this project moving ahead," said Jim Bowles, president of the company's Alaska division.
Palin responded that Alaska would continue to evaluate TransCanada's application and would not permit negotiations with ConocoPhillips to affect its final decision. "As for the gas side of this project and the requests ConocoPhillips has made, we are more than willing to engage in a discussion about the gas terms at the appropriate time," she continued.
"Last year, we made available a package of gas terms as a part of the AGIA legislation. We are open to changing those terms as long as they are fair, reasonable, and based on data," Palin said. Moving to an open season would provide necessary data to make sound decisions on those gas terms, she added.
LNG project optionsFERC also said there have been developments connected with an LNG proposal. The Alaska Gasline Port Authority, a municipal entity created by the City of Valdez, the Fairbanks North Star Borough, and the North Slope Borough, proposed construction of a gas pipeline from Prudhoe Bay to Valdez, where the gas would be liquefied and exported.
Alaskan officials rejected the Port Authority's request to reconsider an earlier determination that the group's application was incomplete. However the officials agreed to thoroughly evaluate LNG project options as part of their determination whether a gas pipeline that goes through Canada sufficiently maximizes benefits to Alaska's population and merits receiving an AGIA license, FERC's report said.
Alaska has held a series of public meetings across the state about the TransCanada proposal and AGIA during a 60-day comment period that concludes Mar. 6. Alaska's legislature is conducting hearings of all five proposals submitted under AGIA and has invited companies that did not submit AGIA applications to testify.
FERC's report said state officials will then decide whether the proposal merits issuance of an exclusive AGIA license, in which case Palin would submit the license to the legislature for final approval, possibly in April. Legislative action to approve the license would have to come within 60 days, and the license could be issued as soon as June, the report suggested.
FERC said other signs of progress since Aug. 15 are the federal coordinator's continued discussions with stakeholders and a technical conference that FERC's staff held in January to discuss third-party contracting requirements and expectations in preparing an environmental impact statement about the project.
Contact Nick Snow at nicks@pennwell.com.

Flaring, thermal power, and LNG

Flaring, thermal power, and LNG

Warren TrueWarren R. True, Editor

Two reports in late summer have implications for the global natural gas industry, especially LNG.
In August, results of a major study of global associated-gas flaring helped clarify flaring’s sources and magnitude. The Global Gas Flaring Reduction initiative released findings based for the first time on satellite observations of earth’s surface.
Also in August, Algeria reported on plans to reduce its dependence on natural gas by using the sun’s heat to produce electricity for export to Europe.
In both reports, implications for the struggle to reduce global production of greenhouse gases are obvious. Implications for continued supply of natural gas for LNG are more problematic.GGFR; Hassi R’Mel
At the 2002 World Summit on Sustainable Development, the World Bank and the government of Norway joined forces to launch the GGFR initiative. Its goal was to eliminate gas flaring and venting.
GGFR is a “public-private partnership with participation from governments of oil-producing countries, state-owned companies and major international oil companies,” according to “A Twelve Year Record of National and Global Gas Flaring Volumes Estimated Using Satellite Data” that recounts what GGFR is and how it went about collecting flaring information.
The objective of the study of gas flaring and its sources was “to investigate the use of earth observation satellite data for the detection of gas flaring and estimation of gas flaring volumes.” The effort produced a series of “national and global estimates of gas flaring volumes” covering 1995-2006 for 60 countries and areas.
Of importance for the natural gas industry are the study’s findings.
One major finding seems counter-intuitive to anyone familiar with the industry and the problem of flaring: Nigeria does not lead the world in flaring the largest volume. Satellite data indicate that “Russia has more than twice the gas flaring volume of Nigeria,” says the report.
The second major finding is that flaring did not substantially increase-or decrease-over the years of the study, remaining “largely stable” in the range of 150-170 billion cu m.
Isolating 2004, which saw flaring of some 160 billion cu m, the study noted this amount compares to 25% of US natural gas consumption and represents “an added carbon emission burden to the atmosphere” of 84 million tonnes.
In a second, unrelated report that ran in many newspapers in August, the Associated Press covered Algeria’s efforts to reduce its dependence on exporting natural gas and to turn increasingly to exporting thermally generated electricity. Just think how much of Algeria is bathed for long hours in sunlight and you begin to understand the country’s logic.
Work on the first plant for thermally generated electricity began in July near Hassi R’Mel. The AP reports the plant, which could be operating by 2010, will be a hybrid, combining “gas and steam turbines with solar thermal input” to generate 150 Mw. Half will come from “giant parabolic mirrors” covering nearly 2 million sq ft.
The project’s long-term goal, subject to solution of massive financial and technical problems, is to export as much as 6,000 Mw of solar-generated power to Europe through subsea cables to Sicily and Spain.Implications
The GGFR report noted a “growing array of technologies to capture and make use” of natural gas currently being flared. Not the least of which is finding ways to move it to markets “using pipelines.”
Pipelines? If gas now being flared or vented had access to pipelines, it wouldn’t be stranded.
It’s the growth of access to liquefaction that plays a larger role in reducing flaring. With much liquefaction construction under way and much more on order, the massive amounts of gas left in the ground or flared into the atmosphere will find markets.
But the GGFR report never mentions LNG or its current rapid growth. It had only to look at Nigeria-which it does mention-to see how effectively LNG has stepped into the equation for reducing flaring.
The timetable for the Algerian thermal generating project, on the other hand, is far too extended and the volumes that will feed it far too small for that project seriously to threaten supply for the country’s LNG industry, the world’s oldest.
The country’s plans should, nonetheless, remind the global LNG industry, lest it become smug in its recent rapid growth and future bright prospects, that natural gas has lots of options, only one of which is LNG.
Warren R. TrueEditorOil & Gas Journal’sLNG Observerwarrent@ogjonline.com