Total Oil

Oil companies struggle for new hydrocarbon sites

Oil companies seek to maintain production in their traditional regions, that’s why they buy up new areas of hydrocarbons, pushing up the price of licenses. Quite serious struggle for seven sites in the Khanty-Mansiisk autonomous district, where all major players on the oil market work now, took place at the auction, held by Rosnedra on Monday, the first time in the past two years.
The oil companies don’t find the sold out sites in the region very promising, but "these are good projects, and the infrastructure is close," – a source of the Kommersant explained the excitement at the auction. He said that there are less and less new production sites of hydrocarbons on land, that’s why the companies had to fight for them more actively.

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TAP announces prequalification tender for supply and installation of gas turbine compressors

The Trans Adriatic Pipeline project consortium has announced another prequalification tender for the supply and installation of gas turbine compressors in Greece and Albania.
The report notes that 6 turbine compressors will be purchased and installed - 3 for a compressor station in Albania and 3 for a compressor station in Greece.

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Oil companies battle for deposits in Khanty Mansi Administrative District

For the first time in 2 years a serious battle erupted between the oil companies for new production projects in Russia. As a result Total has obtained 3 sites at a more than 3 times higher price than the start-up price, Rosneft had to pay by 40 times more for 2 licenses, Surgutneftegas – by 30 times for 1 site. The unexpected battle is primarily explained by the fact that the sites in the Khanty Mansi Administrative District have been put up for sale where all the large players actively work. Moreover, there are less and less “normal” projects left and companies have to compete for them, the participants of the market say, Kommersant writes.

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The coming oil rush in the Arctic carries considerable risks.

The coming rush in the Arctic carries considerable risks, warns Hans-Peter Zibenhaar, writing in the «Handelsblatt» newspaper.
The global demand for oil and gas grows. And Russia plays the central role. The empire of Vladimir Putin is not only the world's largest oil and gas producer, but also the world's largest energy exporter. The huge deposits of Siberia are far from being exhausted.
New technologies, such as fracking, contribute to the reduction in the U.S. energy prices and thus lay the foundation for the deployable re-industrialization of the country. However, because of the energy shortage the oil companies - from BP and Exxon Mobil to Total and Gazprom - are already thinking about tomorrow. Increasingly the Arctic comes in their view. The cold region is adding a tenth of the total gas and oil production. This is not surprising, because the extraction in other places can be carried on more favourable terms. But the geopolitical risks are rising

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The U.S. allows "Rosneft" to trade oil.

Despite the sanctions against the president of "Rosneft" Igor Sechin, the U.S. Federal Trade Commission has allowed the Russian company to buy the trading business of Morgan Stanley. There is only one obstacle to complete the transaction: it is necessary to obtain the approval of the Foreign Investment Committee.
The U.S. Federal Trade Commission (FTC) approved the sale of the Morgan Stanley's trading business to "Rosneft", the website of the Commission states. In order for the transaction to be complete the approval of the Committee on Foreign Investment U.S. (CFIUS) must be obtained. In April, a Bloomberg source stated that the parties are likely to wait for the better relations between Russia and the United States before turning the documents into the committee. Just in April the U.S. imposed sanctions against the president of "Rosneft" Igor Sechin.
In late May, the TV channel CNBC reported, citing an anonymous source, that Morgan Stanley "is in the process of preparing the documents for CFIUS", but has not yet formally applied them. Last week CEO Morgan Stanley James Gorman stated the bank plans to complete the sale of an asset to "Rosneft" in the Q3 2014.

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Total has offered Gazprom to re-start Shtokman using new technologies

The French oil and gas concern Total has offered Gazprom the opportunity to re-start the project of the Shtokman deposit's development using new technologies, the Vice President for Exploration and Production in continental Europe and Central Asia of Total, M. Borrel says at the Global Oil Congress. Total declared in the report for 2013 about the writing off of $350 million of its investment into the deposit development.
Full analysis has confirmed the technical scheme of the deposit development in Russia but the price is too high that does not presuppose the necessary profitability. The company stays in contact with Gazprom in studying of other technical schemes that would be appropriate for economics of the project and future participation of the company in the deposit development. At the same time, the company decided to write off investment its of $350 million into Shtokman.

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TAP project is in the process of the preparation of the construction work

The TAP gas pipeline project is in the process of the preparation for the construction work, which will begin in 2015, TAP’s Managing Director K.Tungland said at the 21st International Caspian Oil and Gas Conference in Baku on Wednesday.
According to him, one of the steps in this process is purchase of land along the pipeline route.
"The next step is to conclude the necessary contracts. We will proceed to the organization of the tender this summer,"- Tungland said.

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Total stops pumping its oil via BTC

Total will stop supplying oil via the Baku - Tbilisi - Ceyhan pipeline (BTC) in connection with withdrawal from the project for the Azerbaijani Shah-Deniz field development, the pricing agency Argus reports.
On May, 30th, the French company sold its 10% stake in the development project of the Shah Deniz gas condensate field, which is operated by BP, to the Turkish oil corporation TPAO. Market participants estimate the amount of the transaction at $1.5 billion.

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Kazakhstan to increase the oil production in the existing fields to compensate for losses from the Kashagan.

Kazakhstan seeks sources for the increase of oil production from the existing fields to compensate for the disruption in the commissioning of the Kashagan field in the Caspian Sea, Yerbolat Dosayev, the Minister of Economy and Budget Planning of the Republic, stated on Wednesday, speaking at the plenary session of the Majilis, Novosti- Kazakhstan informs.
"Today, the Ministry of Oil and Gas in conjunction with the national company "KazMunaiGas" are seeking additional sources of the increased production in other fields to compensate for the loss of volume, which turned out today at Kashagan", - Dosayev stated.
The minister stated that "the revenue budget from the Kashagan project is not provided, because all income goes directly to the national fund". "But the question in (oil) production (remains), which were envisaged in the forecast of socio - economic development for 2015, (the Kashagan input into operation missing the deadlines) affects the growth of GDP", - Dosayev stated.

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Contract for South Caucasus Pipeline’s expansion signed in Azerbaijan

The consortium for Shah Deniz gas-condensate deposit’s development in the Azeri sector of the Caspian Sea signed a construction contract within the frame of South Caucasus main oil line expansion with a JV Saipem/Azfen (Saipem Contracting Netherlands BV and Azfen BM).
According to BP’s Shah Deniz 2 vice president Ewan Drummond there were signed 15 major contracts, over $8 billion worth, as part of the Shah Deniz 2 development.
The most of the works under the project will be finished by 2017.
There necessary the construction and updating of new pipelines.
South Caucasus pipeline will have a new branch. The gas from Shah Deniz will go via the new TANAP in Turkey. TAP will be constructed in Europe to supply gas via Greece and Albania to Italy.
South Caucasus pipeline has been constructed in the same corridor as BTC pipeline to reduce harmful impact on the environment.
The start of work is scheduled for January 2015 with mechanical completion of the Georgian section by the end of 2016 and the Azerbaijan section by the end of 2018.
Capital costs made up $250 million in 2013 (+22.7 times against 2012).
The expenditures for the pipeline are planned at $1.25 billion in 2014.
In late 2013, there was signed a final investment decision on the second phase of Azerbaijani Shah Deniz in Baku.

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