ODAC Newsletter – Nov 18

The race to deliver stockpiles of oil from Oklahoma to the world’s largest refining centre in Texas tightened Wednesday with rivals Enbridge Inc. and TransCanada Corp. both offering strategies that helped push the price of oil above $100 a barrel.

Pipeline capacity envisioned by the Calgary firms will connect abundant oil supplies from the storage hub of Cushing, Okla. to Gulf Coast refineries and promises to narrow the price discount U.S. crude has fetched this year against the global benchmark. That discount reached $28 US a barrel last month, eating into the profits of North American energy firms…

Oil fell from a five-month high in New York as Spain’s borrowing costs surged, heightening concern that Europe’s debt crisis is spreading and will hurt demand.

Futures fell as much as 2.5 percent after Spain sold 3.56 billion euros ($4.8 billion) of a new 10-year benchmark bond at an average yield of almost 7 percent, the most since the euro’s creation. Oil surged yesterday after the Energy Department said U.S. crude stockpiles declined for a second week and Enbridge Inc. said it will reverse the direction of the Seaway pipeline, adding an outlet to transport from the central U.S. and Canada to the coast of the Gulf of Mexico…

The bullet holes in the oil tanks have been patched, the damaged backup generator is being repaired, and most important, the pipeline that feeds the giant oil refinery here has been reopened.

Oil production is quickly being restored in Zawiyah and around the country, in large part because both the Qaddafi regime and the former rebels, now the interim leaders of Libya, took pains to avoid permanently crippling the country’s most important industry during their six-month civil war…

Brazilian police are investigating an oil spill in an offshore field operated by the US company Chevron.

Ships are working to disperse the slick 120km (75 miles) off the coast of Rio de Janeiro state, and Chevron says it has plugged the oil well…

After 11 years and $39 billion of investment, Exxon Mobil Corp., Royal Dutch Shell Plc (RDSA) and their partners have yet to sell a drop of oil from what was touted as the world’s biggest discovery in four decades.

Centered on a man-made island 70 kilometers (44 miles) from Kazakhstan’s coast, the Kashagan project is just months away from completion, $15 billion over budget and 8 years behind schedule. As the milestone of first oil nears, the Kazakh government is pressuring the group for a commitment on an even- bigger second phase, a project the oil companies are undecided on and one analyst says may not make money…

The United States as one of the largest producers ofnatural gas in the world. A golden age for natural gas with dramatic increases in both demand and supply. Oil and gas reserves that surpass all the fuel consumed in human history.

These exuberant declarations, oft-repeated by oil and gas experts these days, may reflect the optimism of an industry that not long ago seemed on the defensive and in decline, but there is nothing irrational about them…

Hayward enters row over oilfields after US giant’s deal with Kurdish region.

The British government and former BP boss Tony Hayward yesterday waded into the legal battle over control of the oil in Kurdistan, calling on Baghdad to stop obstructing the development of the region’s hydrocarbon reserves…

IT may seem strange in an era of cyberwarfare and drone attacks, but the newest front in the rivalry between the United States and China is a tropical sea, where the drive to tap rich offshore oil and gas reserves has set off a conflict akin to the gunboat diplomacy of the 19th century.

The Obama administration first waded into the treacherous waters of the South China Sea last year when Secretary of State Hillary Rodham Clinton declared, at a tense meeting of Asian countries in Hanoi, that the United States would join Vietnam, the Philippines and other countries in resisting Beijing’s efforts to dominate the sea. China, predictably, was enraged by what it viewed as American meddling…

The world’s top natural gas exporters met for a key meeting this week, amid speculation that major producers of the commodity could resort to price-setting tactics and supply controls.

At the first-ever summit by the Gas Exporting Countries Forum, the main items on the agenda were prices and a common approach to the natural gas market…

The Iraqi cabinet Tuesday approved a deal valued as much to $17.2 billon for Royal Dutch Shell PLC to capture and process gas from three giant southern oil fields—Rumaila, West Qurna phase 1, and Zubair in the southern governorate of Basra, a government spokesman said.

“The cabinet today ratified the Basra Gas Company…in which the [state-run] South Gas Company, Shell and Mitsubishi Corp. participated,” Ali Al Dabbagh said in an email statement…

Falling costs mean that the average onshore wind farm will be competitive with natural gas-fired power generation by 2016, according to Bloomberg New Energy Finance (BNEF).

The London-based analysis company says that the levelised cost of energy from onshore wind farms — that is, the cost without subsidies or support mechanisms — has fallen by 14% for every doubling of capacity…

Steve Holliday, the chief executive, said a series of storms had given the power distributor a “pretty exceptional six months in the US”.
National Grid

National Grid reported a 3.1pc fall in pre-tax profits for the six months to 30 September to £971m, down £30m.

The bill for Hurricane Irene came to £69m and the snow storms to £50m, bringing the total storm costs for the period to £140m – against £25m in the previous year…

France’s government has accused the opposition Socialists of planning to undermine the nuclear industry in return for Green party support.

It said the proposed closure of nearly half of France’s nuclear power stations would result in soaring domestic electricity bills as well as job cuts…

Australia’s Prime Minister Julia Gillard signaled on Tuesday an end to a decades-long ban on selling uranium to India, a move aimed at taking advantage of demand for cleaner-burning fuels and to offset a potential drop in sales to Japan following this year’s earthquake.

The policy shift—outlined by Gillard in a newspaper editorial on Tuesday—comes despite India’s continued refusal to sign an international treaty aimed at preventing the spread of nuclear weapons…

A European Union target to promote the use of biofuels will accelerate global species loss because it encourages the conversion of pasture, savanna and forests into new cropland, EU scientists have warned.

The finding raises fresh doubts over the benefits of biofuels, which were once seen as the most effective way of cutting road transport emissions, but whose environmental credentials have increasingly been called into question…

We each produce 2.5 litres of the stuff a day and a total of 6.4 trillion litres globally, but until now it has been widely regarded as a rather unpleasant waste product.

However, a team of UK scientists reckon they may have found an extremely useful application for urine by turning it into electricity…

Around 80 Tories, out of a total 116, have signed a motion urging the Government to take action on rising fuel prices.

During a fiery debate in the House of Commons, MPs called for next year’s 3p increase in fuel duty to be scrapped. They also want more help for people in the countryside who pay more for their petrol…

The soaring cost of fuel overall meant that the Chancellor’s slice of the take at the pump, through duty and VAT, dropped from 81p in every £1 paid by drivers in 2001/02 to 66p in 2009/10.

“Although petrol duty has been rising, it has not kept up with overall fuel price rises, ” said ONS statisticians…

By the end of the year, Sainsbury’s will become the first supermarket to send all its food waste for anaerobic digestion (AD) — the process that decomposes food waste to release biogas which can then be used to produce electricity. Most of the other supermarkets are not that far behind. In 2009 Asda was already sending 25,000 tonnes of food waste for AD and Waitrose aims to achieve zero waste to landfill by 2013.

This is good news for anyone worried by the critical problem of landfill in this country. Food waste sent to landfill rots, releasing methane which is 21 times worse for global warming than carbon dioxide. Under the EU landfill directive, Britain is obliged to reduce the amount of biodegradable waste going to landfill to 50% of 1995 levels by 2013. Whereas most other EU member states met their targets years ahead of schedule, the National Audit Office has warned that Britain is at risk of failing to meet its target, which would result in crippling fines, passed on to local councils, of up to £1m a day. There isn’t a borough in the country that could withstand such a blow…

Liberal Democrat councillors are preparing to revolt over the coalition government’s crackdown on solar subsidies, as a growing number have been greeted with stiff opposition from outraged householders and companies fearing swingeing job cuts.

A secret briefing document seen by the Guardian reveals the extent of Lib Dem anger at the controversial policy to slash solar power incentives for households — a policy that many local Lib Dem politicians feel is a betrayal of their core values. Local councillors are being advised to push for a postponement of the subsidy cuts, as a minimum…

Kuwait’s emir ordered security forces on Thursday to “take all measures” to maintain public order after protesters stormed parliament demanding the resignation of the prime minister over alleged corruption.

An opposition lawmaker, who took part in the invasion of parliament on Wednesday night, threatened more protests if the government and the assembly were not dissolved…

Britain’s economy will come to a standstill over the next six months, the Bank of England has warned, as it slashed its growth forecasts, raised the prospect of a second downturn, and called for patience on the recovery.

Revising its outlook for the first time since August, the Bank cut its estimates for growth this year from 1.7pc to 1pc and more than halved its estimate for next year from 2.2pc to 1pc. George Buckley, Deutsche Bank’s UK economist, said the figures suggested there was a “one-in-three” chance the economy will start shrinking again in the coming months…

The slowdown in the world’s largest economies is set to continue, with economic activity set to fall below its long-term trend in most, according to the Organization for Economic Cooperation and Development’s composite leading indicators.

The Paris-based think tank Monday said its leading indicator of economic activity in its 34 members fell to 100.4 in September from 100.9 in August. And in a further sign that growth is likely to continue to slow, the OECD said that the rate at which new businesses have been launched has fallen in 2011, having risen in 2010…

Four airlines from the UK and Irish Republic are calling for the UK government to scrap Air Passenger Duty.

The tax, which is applied to almost every ticket on a flight originating in the UK, has risen sharply since it was introduced in 1994…