Daily Archives: July 1, 2009

Carola Hoyos

On Energy source today:

Regulators raise concerns about EDF/Areva nuclear reactor design

Bold, Brazen or Bonkers Petroleum: BP in Iraq

Saudi Aramco and ConocoPhillips give a refined sign of economic hope


Sinopec’s acquisition of Addax to boost Sao Tome Exploration (Platts)

Amnesty attacks Shell on Nigeria mess (Guardian)

On Iraq security (CFR)

Nuclear new-build struggling to resurface in the US (WSJ)

Iraq approves BP/CNPC contract (Reuters)

Ed Crooks

The new reactor proposed for Britain by EDF and Areva of France, the European pressurised water reactor, (EPR) has raised concerns at the UK’s nuclear regulator, the Nuclear Installations Inspectorate, which has issued a warning about the design.

The NII wrote to EDF and Areva in April, saying the “adequacy” of the proposed control and instrumentation (C&I) systems for the EPR was “a matter of sufficient importance to raise this as a Regulatory Issue at this stage that may, if not resolved, prevent the successful outcome  [of licensing the reactor for the UK]“.

It is a significant development not only because the UK is set to be a very important nuclear market in itself, possibly the biggest of any developed country over the next decade or two, but also because the EPR’s C&I systems are currently going through licensing processes in France and Finland, where construction of the new reactors is already under way.

Carola Hoyos

Bold is one way to describe BP’s move to become the only western oil company to win a contract to develop one of the world’s biggest oil fields in one of the world’s most unsecure countries. Bold is also BP’s ambition for the field – to turn it into the world’s second largest producer by ramping its output to 2.85m barrels a day, from less than 1m b/d today in a relatively short 6-7 years. Bold was also BP’s willingness to cut its asking price in half, to $2 a barrel, from $3.99. But whether one assesses BP decision as bold, brazen or bonkers may have more to do with one’s definition of an entirely different word….

Ed Crooks

- Oil groups resist Iraq’s tough bid terms (FT)

- Lukoil still hopes to revive Saddam-era oil deal in Iraq (WSJ)

- Eon warns on EU emissions cuts (FT)

- Areva plans to raise 10bn euros (FT)

- With something for everyone, climate bill passed (NY Times)

- BG Group makes first move into US shale gas (FT)

- UK regulator raises concerns over EDF / Areva reactor (Times)

Sheila McNulty

ConocoPhillips and the Saudi Arabian OIl Company (Saudi Aramco) announced on Tuesday they were relaunching the bidding process for the construction of a 400,000 barrel-per-day export refinery at the Yanbu Industrial City in Saudi Arabia.

They had pulled the bidding when the worst of the economic crisis and poor commodity prices were upon the oil industry, hoping for better market conditions to generate more interest in the construction. At the time, the companies cited uncertainties in the financial and contracting markets in delaying the process.

The original plans were for bids to be submitted during December 2008. Now some bids are to be awarded in November 2009 and the others in the second quarter of 2010.

Khalid Al-Buainain, senior vice president for Refining, Marketing and International at Saudi Aramco explained why the bidding was back on:

Market improvements have provided a good opportunity to reactivate the bidding process.

That the companies believe there is enough interest (and financial backing) out there to get in on the bidding is a good sign of an improving economy.

Indeed, they have already handed out invitations for bid notices for the early work and major packages to prequalified local and international contractors.

The major packages include a coker unit, crude facility, gasoline unit, hydrocracker, tank farm, offsite pipelines, high volate electrical paages, as well as other infrastructure packages. The project is targeted to start up in in the third quarter of 2014.

Looks like it is all systems go….

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