The Iraqi government on Thursday stepped up its efforts to woo French business to invest in the oil-rich country, telling Total, the French oil group, it could expect favourable treatment.

On a state visit to France, Jalal Talabani, the Iraqi president, sought to draw a line under differences over the US-led invasion of Iraq in 2003, telling French business leaders they should “show courage and invest in all sectors”.

Mr Talabani directed his strongest entreaty at Total, suggesting that it could win forthcoming tenders to exploit Iraqi fields even if the company did not come in with the highest bid.

Continue reading "Iraq oil: Baghdad bats its eye lashes at France and Total"

On Energy Source:

The downsides of subsidising gas

Devon bets on US natural gas, selling its international and Gulf of Mexico assets

Elsewhere:

Dragon Oil says Enoc won’t offer more than 455p/share (Reuters)

Oil pollutes Sudanese waters (BBC)

Judge: Protecting the environment is no excuse for buying oil leases you can’t pay for (NYT)

China to build another oil storage base (Reuters)

Philippines lifts oil price cap (Philippines Daily Inquirer)

Brazil finds more oil in Campos Basin (AFP)

Russia to open new export route to Asia in December (Reuters)

Regal gets hit with record fine (Guardian)

UK Farmer cashes in on oil boom (sort of), but his wife has the clearest assessment of the oil industry (Express)

What Equatorial Guinea’s agriculture minister can buy in California (NY Times)

Ship to ship oil transfers off Suffolk coast to be banned (EDP 24)

Indian nuclear facilities put on terrorist alert (Vancouver Sun)

Starter for 10: Which is the world’s third largest natural gas consuming country?

Continue reading "The downsides of subsidising energy"

Source: Tullow Oil

Royal Dutch Shell is moving into French Guyana. On the surface, western Europe’s biggest energy group buying into an exploration block is nothing terribly interesting. But, as with oil itself, the answer lies not at the surface, but deep below it.

By buying a 33 per cent interest Tullow’s Guyane Maritime Permit, Shell is buying into 32,000 square kilometres of rock in waters 2,000-3,000 metres deep off the coast off French Guyana, a small French colony north of Brazil. Shell is also buying into the idea that those rocks are similar to the ones in Ghana, that house the giant Jubilee field.

Anadarko, the US independent oil company, and Tullow, listed in the UK, are both partners in the Jubilee field and the ambassadors of the theory that a pattern of rocks rich in oil stretches all along the west African coast, past the Cote D’Ivoire, Liberia and Sierra Leone and then heads out straight across the deep waters of the North Atlantic to the small French prefecture of Guiana on the northeast coast of Latin America. Continue reading "Shell drinks Tullow and Anadarko’s Kool-Aid, buying into French Guyana’s oil potential"

The International Energy Agency warned today that the world’s use of fossil fuels will have to peak by 2020 if it is to escape a dangerous spike in global temperatures.

Fatih Birol, the IEA’s chief economist, said at the launch of the agency’s annual flagship World Energy Outlook: “This would be a revolution. This revolution could only take place if there is a financial signal to the energy industry.” He added: “We need a deal in Copenhagen. We need a signal for the energy industry. Without that, nothing will move.”

Better energy efficiency, rapid growth in renewable energy, and increased use of nuclear power will be critical to move the world away from fossil fuels, the IEA believes. A second revolution would have to happen in the automobile industry so that six of every ten cars sold in 2030 are hybrids or electric by 2030. Continue reading "Fossil fuel use must peak by 2020, warns IEA"

Tony Hayward, BP’s chief executive, revealed some of his thinking on the big questions facing the energy industry in a speech this morning. First, he warned policymakers not to dilly dally lest they want to see the return of energy shortages that plagued the UK in the 1970s and California at the turn of this century.

BP estimates the world will need to spend more than $1,000bn each year until 2020, to meet the expected 45 per cent increase in energy demand. Reducing carbon also needed to be a priority, with governments giving a clear path forward.

“We can’t afford to wait. We need to begin now to begin taking carbon out of the mix today,” he told a conference in London.

But turning the global economy into a carbon-light one will be slow as turn over time of capital stock in the power sector was 30 years, and in cars is 15 years, he argued. Continue reading "BP chief says oil sands, cap and trade will help - but CCS won’t"

When Eni last week clinched the deal to develop the Zubair field in Iraq two clear camps emerged: One that believed the oil company and its partners had finally caved to Iraq’s financial terms and another that believed Iraq had sweetened its terms enough so that Eni, which had refused to accept a deal at the June auction, was willing to come on board.

The critical headline figure of $2 a barrel - the sum Iraq is willing to pay for every extra barrel Eni is able to pump once Zubair reaches the production plateau of a little more than 1bn barrels a day compared to today’s 200,000 barrels a day - remains. That has given Hussein Sharistani the ability to argue he won the battle of wills. Publicly, the oil companies are not entirely unhappy about giving him the victory lap. That is because they feel far safer - physically and financially - starting work in Iraq with a politically strong Sharistani and a country that largely welcomes them. Entering a country that doesn’t want you there increases the risks of kidnappings, sabotage and unpleasant changes to the tax rate.

Privately, oil executives say Iraq sweetened other fiscal terms that brought the entire project’s economics to about half way between the minimum Eni was willing to bid and the maximum $2 Baghdad was willing to pay during the June auction, in which every western oil company except BP walked away complaining about Iraq’s unrealistic terms.

Continue reading "Iraq oil field development contracts: A tale of two - or three - interpretations"

On Energy Source:

ExxonMobil gets itself in a tough oil spot in Ghana

As finding resources means more remote locations, technology is key

Elsewhere:

Kurdistan halts oil exports (NY Times)

Mystery fault hits rig ‘copters (Scottish Sun)

Plugging leaking Australian oil well fails for a second time (AAP)

Oil reserves rations 101 (Investopedia)

Paul L Bloom, tackler of oil companies dies at 70 (NY Times)

Total continues talks in Iran (Dow Jones)

Big bang scientist planned to blow up refinery (Daily Mail)

China and Russia bolster gas ties (Reuters)

Enel may delay decision over renewable energy sale to 2010 (Bloomberg)