US Supreme Court Throws Out Lawsuit Against Shell

WASHINGTON -

The Supreme Court Wednesday said a centuries-old statute making international law enforceable in U.S. federal court can't be applied to actions that take place overseas, blunting a tool human-rights groups had used against torturers and other abusers for violations in their home countries.

In an opinion by Chief Justice John Roberts, the court held that the Alien Tort Claims Act, adopted in 1789 shortly after Congress met for the first time, applies only to actions that take place in the U.S. While all justices voted to dismiss the suit against Royal Dutch Shell PLC, Justice Stephen Breyer, joined by three other liberals, disputed the bright line majority conservatives drew.

Justice Breyer wrote that some lawsuits based on overseas acts should be permitted, if the defendant is an American national or the challenged conduct allegedly harms American interests.

In past decades, victims of former officials of foreign governments have won judgments in federal courts against their abusers. Those rarely have been paid, however, and more recently human-rights advocates have pursued defendants with deeper pockets, such as corporations doing business in countries with questionable regimes, under a theory that they are complicit in the misconduct.

The Supreme Court's ruling Wednesday will close off many such suits.

Still, the majority opinion left open at least the theoretical possibility that some acts abroad could so significantly "touch and concern the territory of the United States" to "displace the presumption" against the statute's use. In a concurring opinion, Justice Anthony Kennedy emphasized that future cases could provide "further elaboration and explanation" of that exception.

The alien tort law remained dormant for most of its history until human-rights advocates rediscovered it in the 1970s and began applying it to violations of modern international law.

In 1980, the U.S. Court of Appeals for the Second Circuit, in New York, ruled that a Paraguayan immigrant could invoke the law against a former Paraguayan police official for the torture and killing of her brother in Paraguay.

Wednesday's ruling involved a case brought by Nigerian refugees against Royal Dutch Shell. The plaintiffs alleged that the Anglo-Dutch oil giant aided and abetted the Nigerian government in a repressive campaign in the country's Ogoni region. Shell denies the allegations.

Initially, the Supreme Court agreed to consider whether the alien-tort law applied to corporations as well as individuals, but after a first round of arguments in February 2012, the justices ordered additional arguments over the far-broader question of whether the law applies at all to events overseas.

At arguments last October, several justices voiced concern that affirming such liability would make American courts a magnet for aggrieved foreign plaintiffs bringing claims for acts completely unrelated to the U.S.--and could invite foreign courts to encourage judging U.S. corporations for actions outside their own borders.

The case is Kiobel v. Royal Dutch Petroleum Co.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

MEOS 2013: Re-thinking Energy

The 18th edition of the Middle East Oil and Gas Show (MEOS) – organized in Bahrain's capital city, Manama in March – saw major national oil companies (NOC), international oil companies (IOC) and service providers from 30 countries share their experiences and visions on current issues facing the industry.

Held under the theme of "Transforming the Energy Future", MEOS 2013 provided delegates access to over 140 presentations during 36 technical sessions as well as 50 poster presentations.

Organized by the Society of Petroleum Engineers (SPE), the conference's opening sessions featured high-ranking speakers representing major NOCs and IOCs, who delivered their perspectives of this year's theme.

Delivering the key note speech, H.E. Shaikh Ahmed bin Mohammed Al Khalifa, Minister of Finance and Minister in Charge of Oil & Gas Affairs, Bahrain said that the theme of this year's conference is well chosen.

"Transforming the energy future, is well chosen as we live in an era where change is the norm and agility and pro-activity means the success between success and failure."

The biggest challenge facing the industry today is not the management of the process of change, but the adaptation to the accelerated rate of change that will shift the oil and gas industry in the next new decade, said Shaikh Al Khalifa.

"To adapt, we need to introduce new methods of thinking and new work processes, to be able to meet the challenges faced by the society in general and energy sector in particular."

The game changers that can have potentially the greatest impact the way the oil and gas industry operates will be the unconventional fuel, renewable energy and energy efficiency measures, Shaikh Al Khalifa said.

"But, one of the challenges facing the industry is the availability of skilled human resources. It is important that the industry ensure the continuous investment in human resources to supply the industry with adequate number of skilled engineers."

Keynote speakers included Amin Nasser, senior vice president of, Upstream at Saudi Aramco; Martin Craighead, president and CEO of Baker Hughes; Paal Kibsgaard, CEO of Schlumberger; Sami F. Al-Rushaid, chairman and managing director at Kuwait Oil Company (KOC) and Sara Ortwein, president of ExxonMobil Upstream Research.

Saudi Aramco said that the best way to predict the future is to invent it, Nasser said.

"Just few years ago, peak oil theories were abundant and processing increasing unsustainable demand, however, the industry ingenuity through technology and exploration advancement notably with tight and shale gas in the U.S., has made abundant and natural gas as well."

Addressing the energy challenges for the future, not only for Saudi Aramco but also for international community, Nasser said that this is an integrated solution that not only look for supply side, but also for demand side, for a better and efficient use of the energy.

"This is a solution that must look at the both sides of the coin, and must be fundamentally sustained by new investments, talents and technology," Nasser added.

Speaking about Saudi Aramco's future strategy, Nasser said that his company is focusing on deep water exploration as well as unconventional resources.

"We have very recently expanded our exploration activities in the red sea, and we have completed series of seismic surface surveys. Currently we are drilling our first deep water well," Nasser said. "While our recent push to exploration for natural gas has been very successful and allowed the gas production to more than triple in few years. We are also aggressively targeting unconventional gas."

Meeting the growing energy demand required innovation and cutting edge technology, in order to be able to unlock new resources while gaining energy efficiency, ExxonMobil's Ortwein said.

"This will allow new supply to benefit more lives with less impact on the environment."

"As we look to the future, I have no doubts that the continued development of our people, and successful application of innovative technologies will help us supplying the energy the world's need," Ortwein added.

Meanwhile, Al Rushaid highlighted the future strategy of KOC, and said Kuwait has enough reserves to grow and maintain production capacity at 4 million barrels per day as per its 2030 strategy.

"Our investment plans are strong and schedule to deliver this capacity, and most of the growth is coming from primary and secondary recovery schemes in easy to medium complexity reservoirs," said Al Rushaid. "However, it is our strategy to not over exploits our easy oil, we plan to create a more manage transition to the more difficult oil structure," he added.

Kuwait plans to produce 3 trillion cubic feet of gas per year by 2030, Al Rushaid revealed.

In addition, Baker Hughes' Craighead stressed the importance of understanding the earth's subsurface to the future of energy. Reframing geoscience, Craighead explained, will play a major role in ensuring that the oil and gas industry delivers affordable energy safely, responsibly, and in a manner that is both economically and environmentally sustainable.

"Our industry is no longer solely about the extraction and distribution of hydrocarbons," Craighead said. "Rather, any discussion about energy is essentially a discussion about the much larger picture of survival, opportunity, and community."

The oil and gas industry is no stranger to challenges and uncertainties, Schlumberger's Kibsgaard said.

The industry is putting a lot of effort into advancing the engineered fluid systems. "If you look at the consumption of water in U.S. based fracking, a lot of it has to do with the fact that these are what we call "slick water" fracs.

"This is water and it's sand, so in order to make sure that the sand stays in suspension we need a high rate and a high velocity and we also need a high pressure to be able to frac," he said.

Other highlights during the course of the conference included a special breakfast session entitled "Financing the Change" delivered by H.E. Abdullatif A. Al-Othman, governor and chairman of the board of directors at Saudi Arabian General Investment Authority (SAGIA). The session addressed how the oil and gas industry can manage and finance itself in light of forecasts that approximate 15 trillion dollars will be spent in the next 10 years to meet expected future oil and gas demand.

Technology has played an important role in the development of hydrocarbon resources, and has made the unconventional resources an economically viable source of energy. Recent examples of technologies include horizontal and multi lateral wells, 4D seismic and advanced fracturing techniques.

Panelists at the technology required to unlock unconventional resources agreed that a game-changing area is hydrocarbon resource development that optimizes the application of technology in unconventional gas including shale gas.

More than 300 companies from 30 countries attended the MEO 2013 exhibition, which covered all areas of the upstream oil and gas industry, including production, reservoir management, drilling, completions, measurement systems, geology, geophysics, automation, transportation, health and safety, and information technology.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Bering Exploration Wraps Up Equipment Installation, Testing at N. Edna

Bering Exploration Inc. announced Thursday that it has completed the installation and testing of the production equipment at the LeJeune No. 1 well, in the N. Edna prospect. This will allow the Company to tie into the pipeline system of the first purchaser of our production. The well is producing at 400 million cubic feet of natural gas per day. Bering owns a 78 percent net revenue interest in the production. This 384 acre prospect is located in Jefferson Parish, Louisiana and has potential gross reserves of the equivalent of 1 million barrels which, based upon today's prices, equates to a gross value of more than $85 million dollars.

"This installation of the production equipment, combined with the pipeline installation by our first purchaser, provides Bering with a consistent source of revenues," stated Steven Plumb, VP of Finance of Bering, "and will enable us to begin seeking capital for additional drilling efforts."

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Crude Oil Settles Higher on Bargain Buying after Recent Sharp Drop

Crude-oil futures prices settled higher Thursday amid bargain-hunting after a recent steep selloff, with North Sea Brent posting its first gain after six down days.

News of lower exports of Nigerian crude oil buoyed prices of European benchmark Brent crude, which had tumbled in the past six session to its lowest level since July 2. Royal Dutch Shell's (RDSA, RDSA.LN) Nigerian unit said it cut output of Bonny Light crude oil by 150,000 barrels a day and halted exports in order to resolve issues with a key oil pipeline.

Traders said an extended outage in shipments of the Brent lookalike would underpin prices of the European benchmark. But the overall supply-demand picture for oil remains weak, amid stuttering signs of economy recovery in the U.S., the world's biggest oil consumer.

"We are a slave to the economy right now and the picture's not particularly great," said Carl Larry, analyst at Oil Outlooks and Opinions.

June North Sea Brent crude oil futures on the InterContinental Exchange settled 1.5%, or $1.44, higher at $99.13 a barrel, after six days of declines. The June contract traded in a high-low range of near $10 a barrel since April 10, dropping 8%, or nearly $8.50 a barrel in the period.

May-delivery light, sweet crude oil futures on the New York Mercantile Exchange settled 1.2%, or $1.01 higher, at $88.20 a barrel, after settling Wednesday at a four-month low.

U.S. benchmark crude has dropped by more than $10 a barrel from highs in early April, as domestic crude oil and gasoline inventories have climbed, while demand for fuels remains sluggish. Front-month Brent, has fallen by about $12 a barrel this month, and the three-day string of prices below $100 a barrel is the longest since June 2012.

"We've lopped off $12 and it looks like we're wrapping up the selloff and starting to stabilize here," said Gene McGillian, broker and analyst at Tradition Energy. "But it's not that all of sudden we have confidence that the economy is improving."

The Labor Department said Thursday the number of U.S. workers applying for jobless benefits last week rose by more than economists had expected. Elsewhere, the Conference Board said its index of leading economic indicators posted an unexpected fall in March, as consumers turned gloomy on the economic outlook. The index declined 0.1% in March, its first fall since August, and counter to an expected 0.2% rise recorded in a survey of economists by Dow Jones Newswires.

U.S. gasoline demand dropped to a one-month low and was the lowest for the second week in April in 16 years, government data released on Thursday show. Demand of 8.383 million barrels a day last week was nearly 400,000 barrels a day below the year-earlier level.

The Energy Information Administration forecasted last week that gains in fuel-efficient vehicles will trim spring-summer driving season demand this year to a 12-year low of 8.877 million barrels a day.

Nymex May reformulated gasoline blendstock futures posted the first gain after falling 12%, or 37.25 cents in five of the previous six sessions to a three-month low. The contract settled up 2.65 cents, or 1%, Thursday, at $2.7555 a gallon.

Nymex May heating oil futures settled 4.45 cents, or 1.6%, higher, at $2.7791 a gallon. Prices fell 7.7% over the previous six days to the lowest level since July 2012.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Lebanon Picks 46 Firms for Gas Exploration Bids

BEIRUT - A group of 46 firms have qualified to bid on a first round of licenses to explore Lebanese offshore gas fields, with 12 qualified to bid as operators, the energy minister said on Thursday.

"This is a new step forward towards the entry of Lebanon into the world of oil," Gebrane Bassil said during a press conference to announce the qualifiers.

The bidding round is scheduled to begin on May 2.

Of the 52 companies that entered the pre-qualification process, 12 qualified as potential operators, and another 34 as potential non-operators able to participate indirectly in the exploitation of Lebanon's offshore gas reserves.

The 12 include U.S. firms Anadarko Petroleum Corp., Chevron Corp. and Exxon Mobil Corp., Europe's Total SA, Repsol SA, Royal Dutch Shell PLC, Maersk Sealand, Statoil ASA and Eni SpA; Brazil's Petrobras, Malaysia's Petronas Carigili and Japan's Inpex Corp.

The bidding will be open until Nov. 4, Bassil said, adding that tender specifications had been finalized but needed to be approved by the cabinet.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Musings: China And The Importance Of The South China Sea

The world has been riveted with the drama unfolding in the northern Pacific region as North Korea rattles its rockets and threatens war. One of the key players in this drama is China, a long-time supporter of North Korea. China has many conflicting geopolitical objectives, some of which are driven by the nation's need for increased energy supplies and raw minerals to power its economy in order to support its 1.2 billion in population.

China realizes it has emerged as a super power, and with that status it must demonstrate its power meaning it must establish dominance in the Pacific region.

Economically, militarily and politically, China has power throughout Asia from Vietnam to North Korea. What it hasn't had until recently is a significant naval presence. That situation is changing as China has built it first aircraft carrier and other sophisticated naval vessels including submarines. At the same time, China has reiterated its long-standing claim over the South China Sea, and with it the country's claim over whatever mineral and energy resources might be present.

China's claim over most of the South China Sea is based on its 1946 undefined claim – the nine dashes on a map.

The South China Sea is a large and strategic body of water. Exhibit 3 shows the numerous agreed boundaries negotiated between South China Sea neighboring countries since the late 1950s. It also shows the declared limits claimed by countries beginning with the 1946 Chinese claim. While there are many geopolitical implications due to these conflicting declarations, our purpose is to examine the significance of the South China Sea to China from an energy perspective.

The initial consideration is the location of possible oil and gas deposits. The Energy Information Administration (EIA), coupled with the resources of other research firms, has put together a map of the possible oil and gas deposits in the South China Sea. A number of these areas have been explored and continue to be explored and developed. Those include deposits offshore Vietnam, China, Brunei and Malaysia. If one re-examines the nine dashes encompassing the area of the South China Sea claimed by China (Exhibit 3, page 5), some resources claimed by Vietnam, Brunei and Malaysia could be claimed by China setting up tension amongst the countries. (See Exhibit 4.)

However, as the EIA shows, these resources are not truly significant in the global scheme of resource deposits. According to the EIA, the undiscovered oil resources of the South China Sea, excluding the Gulf of Thailand, Indonesia's Java, Borneo and Sumatra basins, and the Solu Sea, are slightly greater than those of Europe at roughly 10 billion barrels of oil. The South China Sea ranks seventh in all geographic regions and along with Europe represents a minor increment of the world's undiscovered oil resources.

The South China Sea ranks in the same position relative to Europe and the other regions of the world with respect to undiscovered natural gas resources.

The South China Sea has about a quarter of the estimated undiscovered natural gas of North America, a mature conventional gas resource region, but with a rapidly growing unconventional shale gas potential. At the end of the day, all the proved oil and gas reserves plus all the possible undiscovered ones still leaves the region as a bit player in the world's energy business.

If the oil and gas resource potential of the South China Sea is so limited, why does China find it must demonstrate power in the region? The need to show that as an emerging super-power and with the second largest economy on the planet, China must show strength. At the same time, China is also a significant importer of energy and raw materials, all of which are extremely important for the health of the country, its people and its government. China is targeted to surpass six million barrels per day (mmb/d) of crude oil imports during the second half of 2013. At the same time, the United States, the globe's largest oil importer, will be bringing in less than 6 mmb/d of crude sometime early in 2014, dropping the country into second place behind China on the list of the world's largest oil importers.

For China that is rapidly becoming the world's largest oil importer, protecting that flow of oil becomes a prime consideration of the government. Note in Exhibit 7 (page 8) that nearly 13 mmb/d of oil, almost 15% of total world oil consumption, flows into the Strait of Malacca near Singapore, one of the world's well-established shipping chokepoints. About 11 mmb/d of that oil flow goes beyond Singapore and Thailand and toward Hong Kong, China, South Korea and Japan, making protecting these shipping lanes imperative for the health of those economies.

An equally important energy trade is the flow of liquefied natural gas (LNG), much of which comes from Australia and Southeast Asia, but with a growing volume coming from the Middle East. LNG is likely to become an important fuel for China who has relied upon coal-fired electricity to power its economy with the attendant problem of serious pollution problems in its major cities. In 2011, China imported 12 million metric tons (mts) of LNG, equivalent to 1.5 billion cubic feet per day (Bcf/d). China was projected to import 16 million mts in 2012, or roughly 2.0 Bcf/d, and to reach Japan's 56.6 million mts of LNG consumed in 2012 by 2020. To handle that increased volume, China is planning to construct 15 new LNG receiving terminals to go along with the five already in operation. Given the North American shale revolution, the potential for LNG exports from Canada and the United States has become a real possibility. The opening of a widened Panama Canal by 2015 means LNG carriers coming out of the Gulf of Mexico will have a shorter shipping route to Asia then if they were forced to circle South America in order to reach the Pacific market. Two other developing natural gas industry trends will also impact the global flow of LNG. One is the development of the recent huge gas discoveries in East Africa. The Asian region is the target market for the natural gas recently found offshore Mozambique and Tanzania, but the energy industry is also excited about exploration opportunities in Madagascar, Kenya and Uganda, any and all of which would likely flow to Asia.

Longer term there is also the wildcard of China's gas shale potential. Estimates are that China has the world's largest shale gas resources. If it successfully develops these resources, China could rapidly shift from being an LNG importer to becoming an LNG exporter. Both situations put a premium on China being able to insure the safe passage of LNG tankers, either to terminals in China to offload cargos or to load cargos destined for world markets.

As President Barack Obama has indicated his foreign policy initiatives have pivoted toward Asia, the geopolitical tensions in the region will be elevated, not just because of what North Korea is doing. The United States has entered into upgraded trading relationships with our Asian friends, so we must demonstrate our willingness to stand by them when and if they have to confront China over its South China Sea territorial claims. At the same time, the U.S. Navy must demonstrate our strength in the region to prevent the appearance of the U.S. being perceived as a "paper tiger" by other nations in the world. Defense Department budget cuts coupled with a shrinking and aging fleet of naval vessels is hurting our ability to fulfill the many and varied missions assigned to the Navy. Any change in that course will take considerable time.

While oil and gas developments in the South China Sea will be of interest to the petroleum industry and investment community, the real story of this region is its strategic placement within the flow of energy globally and its importance in the geopolitical struggle between the two leading super-powers – the U.S. and China. With a better understanding of the true importance of the South China Sea to China's economic and political stature, one should be better able to understand the significance of actions and events likely to unfold over the next few years.

G. Allen Brooks works as the Managing Director at PPHB LP. Reprinted with permission of PPHB.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Woodside Halts Pluto Expansion Plans

Woodside Petroleum Ltd. has revealed there are longer discussions with other major oil and gas companies regarding an expansion of the Pluto liquefied natural gas (LNG) project in Western Australia.

Pluto, a $15 billion project that was launched about a year ago, has contributed significantly to Woodside's production profile in recent months.

The operation was a key factor behind Woodside reporting Thursday in its quarterly update a 55 percent jump in production compared to a year earlier for the three months to end-March.

Woodside had previously said it was looking to work with partners on the expansion of Pluto; however, those intentions were also dismissed in the update.

"At present, there are no discussions with other resource owners with regard to Pluto expansion," the Perth-based company said.

"Woodside is continuing its efforts in the pursuit of expansion gas and has exploration activities scheduled in the region over the coming years."

Only a week ago Woodside shelved its development plans for the Browse LNG project, in which the company is majority owner and operator. Woodside said that decision was due to commercial factors.

Despite expansion at Pluto and the development of Browse being currently off the agenda for Woodside, the company recorded several improvements for first quarter 2013 against the corresponding period a year ago.

The increase in production saw Woodside report first quarter output of 21.9 million barrels, which was in line with the company's guidance for 2013. Sales revenue increased by 21 percent to $1.445 billion.

Woodside explained that Pluto, along with the ongoing success of the North West Shelf operation, were major reasons for a lift in production.

However, compared to the previous quarter, to end-December 2012, production was down 10 percent and sales revenue was 18 percent lower.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Noble, PXP Shake Hands on UDW Drillships for Gulf of Mexico

Noble Corp. and Plains Exploration & Production Company (PXP) have entered into two three-year term drilling contracts for the Noble Sam Croft (UDW drillship) and the Noble Tom Madden (UDW drillship), two new ultra-deepwater drillships under construction at the Hyundai Heavy Industries Co. Ltd. shipyard in Ulsan, South Korea.

In the second quarter of 2014, the Noble Sam Croft is expected for delivery followed by the Noble Tom Madden, which is expected for delivery in the second half of 2014.

"With the addition of these units to our U.S. Gulf of Mexico fleet, Noble will have one of the most modern and capable fleets in the region, a fact that demonstrates the fundamental change going on across the company," noted David W. Williams, chairman, president and Chief Executive Officer, in a released statement. "At the same time, these contracts provide us with significant additional backlog, while expanding and diversifying our customer base as we grow our relationship with an important new customer."

Noble expects for the contracts to commence following mobilization of the drillships to the Gulf of Mexico and customer acceptance. Revenues generated over the three-year terms are expected to total about $693 million per rig, including mobilization fees, stated Noble in a press release.

"In the U.S. Gulf of Mexico, which accounted for 31 percent of contract drilling services revenues in the first quarter, four of the region's seven active rigs experienced improved operating performance," stated Williams, in the company's first quarter 2013 earnings report. "Contract opportunities remain strong, especially for rigs addressing customer needs in deepwater."

In September 2012, Plains Exploration acquired more than $6 billion of oil and gas properties in the deepwater Gulf of Mexico.

"Since its acquisition of strategic deepwater oil and gas properties in the Gulf of Mexico, analysts and investors are bullish that Plains can significantly increase its revenues," stated Joe Thomas, an analyst at Wall Street Source, in a press release. "The company's fourth quarter and full-year 2012 financial and operating results highlighted the success of its one-month benefit from its Gulf of Mexico assets."

The company plans to grow its offshore oil and gas production to 275,000 barrels of oil equivalent per day by 2020.

With more than 10 years of journalism experience, Robin Dupre specializes in the offshore sector of the oil and gas industry. Email Robin at rdupre@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
For More Information on the Offshore Rig Fleet:
RigLogix can provide the information that you need about the offshore rig fleet, whether you need utilization and industry trends or detailed reports on future rig contracts. Subscribing to RigLogix will allow you to access dozens of prebuilt reports and build your own custom reports using hundreds of available data columns. For more information about a RigLogix subscription, visit http://www.riglogix.com/.

View the original article here

Shell Studying Oil, Gas Areas Up for Bids in Brazil Auctions

RIO DE JANEIRO - Anglo-Dutch oil major Royal Dutch Shell is interested in Brazil's upcoming oil and natural gas concession auctions but has not yet decided whether to participate, Chief Executive Peter Voser said Thursday.

"Shell will study the bid areas and make a technical evaluation before deciding how to participate" in the auctions, Mr. Voser told reporters. The first of three auctions scheduled for this year will be held May 14-15, the first such bid round since 2008.

"Our assumption is that Brazil has significant resources being developed and to be developed," Mr. Voser said, noting that Latin America's largest country will play an important role in the global oil and natural gas map in the future.

In addition to the concession auction, Mr. Voser said that Shell was evaluating assets state-run energy giant Petroleo Brasileiro, or Petrobras, has put up for sale in Brazil and the Gulf of Mexico. Petrobras plans to sell $9.9 billion in assets to fund its $237 billion investment plan through 2017.

"We have a very successful partnership with Petrobras and are interested in further collaboration," Mr. Voser said.

Shell is also carefully watching developments in Venezuela, where the company has a small operation in the Lake Maracaibo region, Mr. Voser said. Venezuela has suffered with political unrest following President Hugo Chavez's death and last weekend's election of his handpicked successor, Nicolas Maduro.

"We take a long-term view on investments in Venezuela," Mr. Voser said, adding that Shell was on the lookout for growth opportunities in the country that is home to the world's largest crude-oil reserves.

Elsewhere, Mr. Voser said, the shale gas revolution in the U.S. could fundamentally change industry in the world's largest economy. "Cheap natural gas feedstock could drive a reindustrialization in the U.S.," Mr. Voser said, bringing previously outsourced manufacturing heavy industry and petrochemicals output back to the U.S.

Shell also expects the U.S. to approve exports of between 50 million and 60 million tons of liquefied natural gas derived from shale gas, Mr. Voser said.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Nymex Crude Futures Settle at Fresh 2013 Low on Demand Woes

Oil futures extended their recent losses Wednesday, hitting their lowest level all year in the U.S., as investors focused on falling gasoline demand in a weekly report on domestic crude stockpiles.

The Energy Information Administration said its measure of demand for the motor fuel fell 1.1% to 8.3 million barrels a day during the week ended April 12, the lowest level for that week in 16 years.

The decline in demand follows weeks of disappointing economic headlines, which have damped sentiment about oil demand.

"Demand is weakening and looking at the economic numbers of the last few weeks we knew that was going to happen," said Carl Larry, president of Oil Outlooks and Opinions, an energy newsletter.

Light, sweet crude for May delivery settled $2.04, or 2.3%, lower at $86.68 a barrel on the New York Mercantile Exchange, the lowest finish yet this year. Brent crude on the ICE futures exchange recently declined $2.11, or 2.1%, to $97.80 a barrel.

The disappointing gasoline demand figure is the latest sign that demand concerns have captured the focus in the oil market, particularly in the wake of disappointing economic data out of the U.S. and elsewhere.

In recent weeks, the International Energy Agency, the Organization of the Petroleum Exporting Countries and the Energy Information Administration all cut their outlook for 2013 oil demand growth. Nymex crude has fallen more than 10% since a recent high in February, while Brent has shed more than 15% since February.

"Demand, especially in Europe, is going to continue to be poor," said Andy Lipow, president of Lipow Oil Associates, a Houston consultancy. "That and stagnant growth in the U.S. Those are weighing on the market."

Analysts at BNP Paribas were the latest market observers to cut their oil-price forecast, citing the recent market downturn. The analysts cut their 2013 average forecast for Nymex crude to $95 a barrel from $100 and cut their Brent outlook to $108 from $115, though they said prices could recover later in the year.

The EIA said oil stockpiles last week dropped 1.2 million barrels last week, marking a retreat from a 23-year high. Analysts surveyed by Dow Jones Newswires were calling for an increase of 900,000 barrels. Gasoline stocks fell 600,000 barrels, while stocks of distillates--including heating oil and diesel--jumped 2.4 million barrels.

Refinery utilization fell 0.5 percentage point to 86.3% of capacity.

Analysts expected U.S. gasoline stockpiles to fall by 500,000 barrels, while stocks of distillates were forecast to fall by 500,000 barrels. Refiners are expected to keep operations unchanged.

Front-month May reformulated gasoline blendstock, or RBOB, settled 5.28 cents, or 1.9%, lower at $2.7290 a gallon. May heating oil settled 7.19 cents, or 2.6%, lower at $2.7346 a gallon.

Copyright (c) 2013 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here