Oil headlines

December 13, 2013

Click on the headline (link) for the full text.

Who Owns the Arctic

Baden Copeland and Derek Watkins, New York Times
Territorial claims of countries in the Arctic are being spurred by the presence of large caches of oil and natural gas, melting ice and dwindling energy reserves in other regions.

Go to source to view the amazing graphic – SO.
(7 December 2013)

Gazprom’s over-reaction to Arctic oil protest is a sign their fortune is at stake

Kumi Naidoo, The Guardian
…The profit margins on offshore oil extraction in the Arctic have always been slim, and it’s certainly arguable that recent developments onshore, most notably the discovery of the Bazhenov shale deposits, have made Gazprom and Shell’s expensive joint venture even less economically viable than it already was. If that’s the case, then Greenpeace drawing attention to its weaknesses (like the lack of any plan to clean up an oil spill) stops being a mere annoyance and becomes a serious threat.

Yet by over-reacting and demanding the FSB take action, Gazprom attracted a lot more publicity than the hanging of a banner could ever have achieved.

I think the Prirazlomnaya and Gazprom’s machinations to keep it afloat need to be understood in a global context, where an unlikely and somewhat uncomfortable coalition is forming between investors, environmentalists, scientists, intelligence agencies and an increasingly radicalised public all calling for governments to intervene on climate change. If we – and they – succeed, then Gazprom and its partner Shell will see billions wiped from their balance sheets…
(13 December 2013)

Canadian Oil Producers May Have A Lot More Riding On The Keystone XL Pipeline Than Transcanada

Jeff Spross, Think Progress
The fate of the Keystone XL pipeline may matter far more to Canada’s oil producers than to Transcanada, the company that would actually build it.

According to a story yesterday in Bloomberg, Transcanada has reduced Keystone from 32 percent of its contracted projects four years ago to just 14 percent today. It did that by taking on new projects — the total for which now stands at $38 billion, including some solar power — and by splitting the Keystone XL pipeline itself into two legs. The southern portion, from Oklahoma to the Gulf Coast, has already been constructed and is scheduled to start moving crude in January of next year.

Transcanada has already had to excavate the southern leg at 125 different locations to repair various problems.

But while the Keystone pipeline is smaller as a share of Transcanada’s overall business, it still looms large for several of Canada’s major oil production companies. Bloomberg reports that Canadian Natural Resources Ltd., for one, has already booked 120,000 barrels per day on the Keystone XL, and plans to boost its output of oil sands in 2014 by 14 percent. Suncor Energy Inc. has also already secured a portion of the pipeline’s oil flow, and plans to boost production 10 percent in 2014. Imperial Oil Ltd. is yet another company that’s already booked capacity.

That makes Keystone “far more important” to those companies than to Transcanada, said John Stephenson of First Asset Investment Management Inc., who helps oversee investments in all three companies. Todd Kepler, an analyst at Cormark in Calgary, also told Bloomberg that stocks for all three companies, as well as for several others, could rise if the U.S. government ultimately gives construction of Keystone’s northern leg the green light. If it doesn’t, Canadian Natural could see a drop of 3 percent…
(7 December 2013)

OPEC oil production update July 2013

Euan Mearns, Energy Matters
OPEC production has been bumping along a plateau of around 35 million bpd since 2005, that is despite prolonged record high oil prices.

This is the first in a series of updates on global oil supply based on monthly data published by the US Energy Information Agency (EIA). Owing to budget cuts the EIA has fallen behind in data compilation hence the last reported data is for July 2013. JODI and the International Energy Agency (IEA) also report monthly oil production figures and at some point I will include these sources in my analysis. OPEC has 12 members and there is a chart for each country and a stack for all 12 countries below the fold…
(9 December 2013)

Mexico deputies scuffle in chamber over energy bill

Staff, BBC
There have been scuffles in the lower house of the Mexican Congress as lawmakers discuss a controversial energy reform bill.

Landy Berzunza of the governing PRI party was taken to hospital with a scratched retina after an altercation with opposition MP Karen Quiroga.

Another opposition MP, Antonio Garcia Conejo, stripped down to his underwear to show his rejection of the bill.

The bill aims to open Mexico’s state-run oil fields to foreign investment…
(12 December 2013)

IEA Boosts 2014 Global Oil Demand Forecast on U.S. Recovery

Grant Smith, Bloomberg
Global oil demand in 2014 will be higher than previously forecast, after consumption in the U.S. rebounded to its strongest level in five years, the International Energy Agency said.

The IEA estimated today in its monthly oil market report that demand will increase by 1.2 million barrels a day, or 1.3 percent, to 92.4 million a day next year, raising its projection from last month by 240,000 a day. U.S. fuel use rose above 20 million barrels a day in November for the first time since 2008, according to preliminary data. While the agency boosted its forecast for the crude volume OPEC will need to supply, “making room” for the potential return of Iranian exports “could be a challenge for other producers” in the group, it said.
(11 December 2013)

Worst-Case Scenario for Oil Sands Industry Has Come to Life, Leaked Document Shows

Katherine Bagley, InsideClimate News
As environmentalists began ratcheting up pressure against Canada’s tar sands three years ago, one of the world’s biggest strategic consulting firms was tapped to help the North American oil industry figure out how to handle the mounting activism. The resulting document, published online by WikiLeaks, offers another window into how oil and gas companies have been scrambling to deal with unrelenting opposition to their growth plans.

The document identifies nearly two-dozen environmental organizations leading the anti-oil sands movement and puts them into four categories: radicals, idealists, realists and opportunists—with how-to’s for managing each. It also reveals that the worst-case scenario presented to industry about the movement’s growing influence seems to have come to life.

The December 2010 presentation by Strategic Forecasting, or Stratfor, a global intelligence firm based in Texas, mostly advised oil sands companies to ignore or limit reaction to the then-burgeoning tar sands opposition movement because "activists lack influence in politics." But there was a buried warning for industry under one scenario: Letting the movement grow unopposed may bring about "the most significant environmental campaign of the decade."…
(5 December 2013)

Tar sands, Alberta image via howlcollective/flickr

Tags: Arctic oil, Canadian tar sands, geopolitics, Oil