Mexico’s oil regulator trims area of upcoming oil tender
Mexico’s oil regulator on Thursday said it removed two areas within a block of oil exploration and production rights to be auctioned next month in order to extend talks with indigenous communities who live there. Areas 10 and 11 in the southern state of Chiapas will no longer be included in the tender, scheduled for July 12, Juan Carlos Zepeda, head of the oil regulator, known as the CNH, said during a session of the organization. Each area takes up about 400 square kilometers (150 square miles) and contains light and super-light crude, according to the CNH. Another 10 areas remain in the July 12 tender. Mexico is auctioning rights to explore and produce hydrocarbons in a bid to attract more private investment to the industry after Congress changed the constitution in late 2013 to end the 75-year monopoly of state oil company Pemex. This week, it auctioned two-thirds of the shallow water oil and gas blocks offered in the most recent round. The energy ministry said on Wednesday it would ask the CNH to remove the two areas from the July 12 round to provide more time for talks with local Zoque and Tzotzil communities. The next tender was the first to involve territories with significant indigenous populations, and the 2013 legal change requires the government consult with them before proceeding. Joffrey Lupul Authentic Jersey
Qatar ideal first diplomatic crisis for oilman Rex Tillerson
The Qatar crisis presents Rex Tillerson with his first challenge as Washington’s top diplomat and an opportunity for the former oilman to use his vast network of contacts. But while his former life as chief of energy giant ExxonMobil prepared Tillerson well, he does have one potential handicap, his new boss, President Donald Trump. While Trump has claimed credit for Saudi Arabia’s air and land blockade of its gas-rich neighbor, Tillerson has urged an end to the embargo and restored alliances. That differing approach could make the secretary of state’s task difficult at best, but his friends in Washington say his regional experience makes him just the man for the job. “If anyone can do it, it’s him,” says James Jeffrey of the Washington Institute of Near East Policy, a former senior diplomat who advised Tillerson at Exxon. On the face of it, the diplomatic standoff in the oil and gas-rich Gulf has all the makings of a US foreign policy disaster coming at the worst possible time. Late last month, Trump made what appeared at the time a triumphal visit to Riyadh to unite US friends in the region against Iranian meddling and Islamist extremism. But just weeks later, on June 5, Saudi Arabia, Bahrain, Egypt and the United Arab Emirates broke ties with Qatar, accusing its royal government of backing terrorist groups. The resulting stand-off left the countries that host the bulk of US forces in the region — Turkey, Qatar, Kuwait and Iraq — at odds with Washington’s other key allies. And it could only strengthen the hand of Iran, which is confronting US and Saudi interests through covert operations and proxies in Syria, Yemen, Iraq and Lebanon. Trump initially appeared to revel in the situation, praising Riyadh for standing up to fight terror financing and accusing Qatar of supporting extremism at a “high level.” But Tillerson ,who has been asked by the White House to help defuse the situation took a different tack, and this week appeared to be making some progress. On Tuesday, after the secretary of state had cancelled a planned visit to Mexico and spent two frustrating days on the telephone, he issued a strong statement. His target was not Qatar, although he has been clear that all countries should do more to eradicate terror funding — but Riyadh and its Emirati ally. Tillerson’s spokeswoman, Heather Nauert, told reporters that Washington was “mystified” that the Saudis and Emiratis had not released details of their allegations against Qatar. “The more that time goes by, the more doubt is raised about the actions taken by Saudi Arabia and the UAE,” she said, before turning the knife. Were Riyadh’s actions really about “Qatar’s alleged support for terrorism, or were they about the long simmering grievances between and among the GCC countries?” she asked. The statement was a clear signal that, despite Trump’s rhetoric, official Washington blames the Saudis for escalating an unnecessary dispute. It was not the first such signal from Trump’s top national security team ,whose actions often struggle to speak louder than the president’s words. A week earlier, Secretary of Defense Jim Mattis signed a $12 billion deal to sell Qatar supposedly a terror sponsor US-made F-15 fighter jets. In case that wasn’t a strong enough sign, Tillerson also made what for him was a rare appearance before reporters to urge the Saudis to “ease” their embargo. Will Saudi Arabia and the Emirates listen to the State Department and the Pentagon, and seek a face-saving agreement with Qatar that reunites the allies? Or will they listen to Trump, who during a Wednesday campaign speech praised the Saudi king “for fighting with other countries that have been funding terrorism”? The key to re-balancing the relationship will lie with Tillerson. “I think he’s doing a good job, and he knows everybody. He knows the Saudis and the Qataris very well,” said Jeffrey, a White House advisor under former president George W. Bush. For Jeffrey, the mistake was to let Riyadh think Trump had given them a green light. “It isn’t that you have two separate policies. Trump is supporting Mattis and Tillerson,” Jeffrey argues. “It’s just that Trump can’t help himself as he communicates in a different sphere through tweets and with his supporters. “It’s not Trump the commander-in-chief or the president, it’s Trump the leader of a movement with its own worldview,” he said. “It’s going to take a while for the Saudis and the Emiratis to understand this and not to take it to the bank, which is what they did.” On Wednesday, a day after the strong “mystified” statement, Tillerson announced that Riyadh had now indeed drawn up a list of demands. Zack Wheeler Womens Jersey
Iran begins sending gas to Iraq under major deal
Iran has begun exporting gas through a pipeline to Baghdad under a deal set to make Iraq the Islamic republic’s top customer, the oil ministry said. “Iran’s natural gas exports to Baghdad began yesterday evening,” Deputy Oil Minister Amir Hossein Zamaninia said late yesterday in comments carried by the ministry’s Shana website. “The exports have started with a volume of seven million cubic metres a day and will eventually reach 35 million cubic metres,” he said. The announcement came two days after Iraqi Prime Minister Haider al-Abadi visited Iran following a fence-mending trip to its bitter rival Saudi Arabia amid diplomatic turmoil in the Gulf. A new pipeline links western Iran to Baghdad, while a second in Iran’s southwest will pump Iranian gas to the southern Iraqi city of Basra. Once the Basra pipe comes online, Iraq’s total gas imports from Iran are set to reach up to 70 million cubic metres a day. Iran sits on the world’s second largest natural gas reserves and produces some 600 million cubic metres a day. But despite almost doubling its oil exports since international sanctions were lifted under a 2015 nuclear deal, it consumes most of its gas domestically – partly for lack of export infrastructure. Turkey has so far been its only export client, importing some 30 million cubic metres a day under a 1996 deal. The Islamic republic, seeking to expand its gas market, is developing production facilities in the huge offshore oil and gas field of South Pars, which it shares with Qatar. Shiite-dominated Iran and Iraq, which fought a devastating war in the 1980s, have become close allies since the 2003 fall of Sunni strongman Saddam Hussein and the rise of a Shiite-led government in Baghdad. Zac Dalpe Womens Jersey
Gst To Make Oil And Gas Business More Expensive: Shell India CEO Nitin Prasad
Netherlands-based Royal Dutch Shell plc, the world’s second-largest oil company, has been focussing on aligning with the energy markets’ transition underway globally. India being at the heart of that transformation, the company has rolled out aggressive plans for expanding operations in natural gas and alternative fuel segments apart from the traditional fuel retailing business, Shell India CEO Nitin Prasad said in an interview with ETEnergyWorld. Edited excerpts.. Shell Global CEO Ben Van Beurden recently announced an overall investment plan of around $25 billion in 2017. What part of that investment is likely to flow to India and in which priority areas? I may not be able to share investment figures. But we are looking at an aggressive expansion in retail business and that is going to bring capital into the country. We are looking at our lubricants business which is extremely successful and we feel it will become even more successful with the BS VI transition and we are investing quite heavily in that. We are taking a look at new energies as an area. So, investing quite a bit in that space. We are also taking a look at bio-fuels and waste-to-fuel, as that technology proves itself. We are looking at next generation technologies which are being developed in our lab in Bangalore. We are looking at next generation digitisation and data management in our IT hub. We are investing heavily in that space. And, of course, we are investing tremendously in the gas space, too. Given this long list of focus areas, can you give us a perspective on the company’s thinking on HR. What is the size of the job opportunity that Shell is offering in India in years to come and in which segments? Shell in India employed around a few hundred people around ten years ago. Today, we are touching a strength of nearly 7,000 people and we will be 7,500 by the end of this year. We will be the third-largest employer in the entire Shell Group. And this is not going to stop. We will add more jobs to the country going ahead. And this includes only the direct employees. The numbers are much higher if we take into account the contract staff and the support staff. We are spending a lot of time in creating that big base of jobs. At the same time, this process is resulting in skilling India. In the entire base of 7,500 employees, there is a 10-15 per cent attrition rate. And that is an industry standard. Every year, we are bringing in 1,000 new people in our fold and also another 1,000 who are moving out. This ensures that we spend a lot of time building the skill and capacity across the organisation. A number of our competitors who are behind us in terms of setting up an R&D facility and IT Hub etc, are trying to take some of our people. Which are the key areas where most of the new workforce will go? Shell Energy India will attract people who will come and develop the gas market strategy in India. Our retail business, because of the expansion, is also going to attract additional workforce. IT will attract several hundred people. And a couple of hundred people in the Finance wing also. So, across the board, fresh induction in commercial segment will range in tens to hundreds; while IT and Finance segments will each have new people in multiple of hundred. How does GST impact the core areas of your business? GST implementation is a good thing for us in areas which are part of the GST ambit. So, it is good in lubricants, not with-standing the challenges of pace of implementation and logistics. But it is a big issue in gas and petroleum products. If I am producing gas and I am bringing in LNG today, that means that there is a whole amount of products, equipment and services that go into providing that molecule. All of that will attract GST. Who do I charge it to? I have input credits but I have no output credit because I cannot put GST onto the product. So, in effect we have made our entire business more expensive which is a problem. And also, some of the alternatives like coal are in, even as gas is out. So, it will dynamically shift the end-consumer preferences. So, there is a double whammy here. That is a big problem. What is your view on the daily fuel price change? What kind of impact do you see on retail business and consumers? I am a big fan of this move. The implications of the move going down the chain are very positive. Product prices in the global context and for Asia Pacific change daily. Similarly, gas prices change daily, rather hourly. So, when the retail prices are locked, the person at the retail end turns into a trader because he gets a forward contract at a fixed price. With daily pricing, that volatility comes all the way down to the last mile. So, the price prevailing in the market is the same price available at the pump. It is a good thing and a sophisticated concept. It opens a door of opportunity for everybody to compete on pricing. Today, it does not really make sense for all the retailers to have the same price. After all, they are competitors in a market place. They have different offers in different locations. Why should they be offering the same price? RIL and BP have just announced a major plan to jointly invest Rs 40,000 crore in KG Basin blocks apart from partnering to expand retail presence. How do you look at this announcement given that Shell is also now a major player in the upstream segment after the BG acquisition. The BG acquisition has created a lot of opportunity for us in India in the upstream segment. It was a $50-60 billion acquisition. We have brought fields under development and
Reliance Industries, Bp Withdraw Gas Price Arbitration Against Government
Reliance Industries and partner BP have withdrawn the gas price-related arbitration against the government, paving the way for the companies to claim the premium price for output from deep-sea fields in which they plan to invest Rs 40,000 crore. This is the second case of arbitration that RIL and BP have withdrawn, sending another strong signal that the relationship between the oil ministry and RIL, which had become acrimonious during the UPA regime, has normalised enough for the partners to turn their attention from litigation to investment. Last week, RIL chairman Mukesh Ambani and BP Plc CEO Bob Dudley signalled confidence in the policy environment and the regulatory regime by announcing their plan to invest $6 billion in new fields discovered long back in the deep-sea KG Basin block. “Yes. The gas price arbitration has already been withdrawn,” BP said in an emailed response to ET’s query. RIL did not respond but sources with direct knowledge of the matter told ET that the company had written last week to the government that it no more wished to pursue the gas-price arbitration. The communication came around the time Ambani and Dudley announced the new investment in the gas-rich block to produce 30-35 million cubic metres a day in three to five years. The output from these fields can fetch premium prices only if the operators have no litigation against the government, a key condition that has now been met with the withdrawal of gas price-related arbitration. Last year, the government announced a new policy that allows gas from fields in difficult terrains like deep-sea regions to be sold at almost double the price allowed for normal fields. Reliance and BP are developing new fields at a time when the cost of oilfield equipment and services have crashed while their output will begin around the time analysts expect the global gas glut to end. Equipment prices have crashed due to low demand because the fall of crude from about $115 to below $50 have prompted oil firms to stop exploration and development in deep-sea regions, which need a higher price to justify the investment. Three years ago, RIL, which owns 60% participating interest in the KG block with BP owning 30%, invoked an arbitration following the government’s refusal to implement a price formula for domestic gas that could have doubled the prevailing price. The government challenged Reliance’s power to invoke arbitration in the Supreme Court, arguing that the government alone enjoyed discretion on which price policy it should implement and a company can’t force it to apply a certain policy. The case has dragged on for three years with no consequence as yet. Last year, Reliance Industries, which is engaged in a string of arbitration cases against the government, dropped another arbitration in which it had contested the government’s 2013 order to relinquish about 80% of the KG-D6 area. There are four more arbitration cases between RIL and the government. These are over disallowance of cost-recovery in its KG-D6 block, amount the company must pay for unfinished minimum work programme and illegal production of gas from ONGC’s fields in the KG basin. Another dispute related to Panna-Mukta, Tapti fields has received arbitration award but the parties are still seeking more clarity on it. Pedro Martinez Jersey
IOC, BPC and HPC sign joint venture agreement for West Coast Refinery Project
India’s emergence as a global refining hub received a big boost with the three downstream PSU oil majors, Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation, joining hands to build one of the world’s largest integrated Refinery-cum-Petrochemicals complexes in Ratnagiri district of Maharashtra. The joint venture agreement for the West Coast Refinery Project was signed here today in the presence of Mr. Dharmendra Pradhan, Minister of State (Independent Charge), Petroleum & Natural Gas; and Mr. KD Tripathi, Secretary, Petroleum; by Mr. Sanjiv Singh, Chairman, IndianOil; Mr. D Rajkumar, CMD, Bharat Petroleum; and Mr. MK Surana, Chairman, Hindustan Petroleum. The 60 million metric tonnes per annum (MMTPA) west coast refinery-cum-petrochemicals complex will be a state-of-the-art unit built at an estimated cost of US$ 40 Billion, and is expected to be commissioned by the year 2022. It will be a green refinery comprising 50 units designed to operate at the highest level of efficiency, and will be self-sufficient in power and utilities requirements, besides creating a benchmark in environment management. Designed to produce Euro-VI and above grade transportation fuels, the refinery will have in-built flexibility for processing a wide spectrum of light and heavy crude oil grades, utilising various blending techniques. It will also be able to produce on-demand product mix of petrol and diesel streams, as well as other refined products and petrochemical streams with the highest level of integration and energy efficiency. The preliminary configuration study of the project is being carried out by M/s. Engineers India Ltd. in association with an international consultant. M/s. IHS has been entrusted with the market study for the chemicals and petrochemicals to be produced at the complex. The project will be embedded with social responsibility initiatives and a skill development centre, and a smart township with best-in-class services is also being planned. Apart from the main refinery-cum-petrochemicals complex, the viability of other associated industries in the vicinity of the project is also being examined so that all stakeholders can be involved in the mega project. Jacob de la Rose Authentic Jersey
Indonesian firm interested in building crude oil refinery in Nigeria -NNPC
Indonesian engineering firm PT Intim Perkasa has expressed an interest in building a refinery in Nigeria, the West African country’s state oil company said on Wednesday. Nigeria has been seeking investment in the sector to reduce reliance on imported oil products that consume a large portion of the OPEC member’s scarce foreign currency reserves. Its existing, ageing refineries produce hardly any fuel after years of neglect. A representative of PT Intim Perkasa Nigeria Ltd, a subsidiary of the Indonesian company, indicated an interest in building a modular refinery in the southern Akwa Ibom state, the Nigerian National Petroleum Corporation (NNPC) said in an emailed statement. It would have a refining capacity of 10,000 barrels per day,said NNPC spokesman Ndu Ughamadu in the statement. Nigeria currently has a refining capacity of 445,000 barrels per day (bpd). “We have embarked on an ambitious plan to fast-track programmes to restore our capacity utilization from 30 per cent to a minimum of 90 per cent in the next 24 months,” said Maikanti Baru, NNPC group managing director. “To do that, we are working on securing financing from third parties, not just funding, but also technical expertise,” headded. Kentrell Brice Womens Jersey
Iran starts gas exports to Iraq, Iranian official says in IRNA report
An Iranian oil official said Wednesday that Iran has begun exporting gas to Iraq, according to the official Islamic Republic News Agency (IRNA). Exports had started at approximately 7 million cubic metres per day and would eventually reach up to 35 million cubic metres per day, said Amir Hossein Zamaninia, the deputy oil minister for trade and international affairs, according to IRNA. Iran signed two contracts to export gas, to the Iraqi capital Baghdad and the southern Iraqi city of Basra, IRNA reported. Nail Yakupov Womens Jersey
Russian oil company Rosneft to sell petroleum in India
Rosneft, a Russian oil company, will enter retail petrol market of India, the country’s Oil Minister Dharmendra Pradhan said on Sunday. According to the official, in the past fiscal year, Rosneft invested about $13 billion in a local oil refining company Essar. “I the near future, we expect the closing of an acquisition of Essar Oil Ltd oil refinery by the international consortium headed by Rosneft, which also owns a network of 2,700 gas stations across India. Deregulation of pricing in the retail market of India has opened up the prospect of efficient growth in retail sales. The company plans a significant expansion of the network”, a representative from Rosneft told Life TV Channel. Terry Sawchuk Authentic Jersey
Cairn Energy expands hunt for oil and gas to Mexico
CAIRN Energy is moving into frontier exploration territory off Mexico as the oil and gas firm looks to repeat the success it has enjoyed off Senegal. Edinburgh-based Cairn was awarded interests in two big chunks of acreage off Mexico in what was only the second licencing round completed by the country. The awards will allow Cairn to continue with a strategy which involves focusing its exploration effort in areas where there has been relatively little drilling. Chief executive Simon Thomson said: “We are delighted with these awards which we believe provide an exciting opportunity to build a strategic portfolio over time in this highly prolific yet under-explored region.” While Mexico is rich in oil and gas the country’s waters have seen little activity by international standards. State-owned Pemex had a monopoly on oil and gas production until the country decided in 2014 to open the market to private investment. Mexico completed its first licensing round only last year, after deciding it needed to attract international expertise to help make the most of its resources. The decision to award Cairn the shallow water licences in the southern Gulf of Mexico provides a vote of confidence in the firm on the part of the country’s government. The round attracted interest from a range of majors including Total and Royal Dutch Shell. Cairn is partnering Italian giant Eni and Mexican exploration and production firm Citla on one of the licences it won. It is operating one of the licences, with Citla as its partner. The companies beat Eni in the bidding for that licence. Cairn said it expects drilling to start on both licences in the 2019-20 period. The move into Mexico comes after Cairn burnished its credentials as an explorer by making two big finds off Senegal in 2014. There had been little activity off the country, which is now attracting interest from giants. Since taking charge in 2011, Mr Thomson has built a portfolio that combines potentially transformational exploration in frontier areas with lower risk development activity in the North Sea. Cairn achieved renown by making bumper finds in India under founder Sir Bill Gammell. On Monday Cairn said India’s authorities want to stop the firm getting $104 million dividends due to it pending resolution of a tax dispute. Brett Hundley Authentic Jersey