Archive for the ‘natural gas’ Category

Vitol’s CEO sees up-and-down oil prices, but it isn’t an opportunity

The kind of crazy up-and-down movements of the oil markets in recent weeks and months is not a ripe opportunity for a major trading company like Vitol. In fact, its CEO and chairman Ian Taylor says that whipsaw activity is a nightmare for his company.

“A market that is up $3 in the morning, down at lunchtime and then back up again at the close is almost impossible to hedge,” Taylor said in a one-on-one interview this week as part of the Platts Global Energy Forum. “I don’t think the trading companies do particularly well in that environment.” (Full disclosure: I conducted the interview with Taylor at the forum’s luncheon.)

And contrary to some beliefs, a relatively calm market that goes on many months — like the first part of 2014 — isn’t quite as bad as it might seem. “You’re making an assumption that traders speculate,” Taylor said when asked whether the first relatively non-volatile part of the year was a difficult time for a trading company. “Hardly any trading companies in existence today speculate. Shell, BP, Vitol…we don’t do flat price trading. A predictable long-term trend is much easier to handle.”

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How lower crude oil could impact UK energy plans

The dramatic fall in crude oil prices in the second half of this year runs against the recent assumptions of the UK’s energy policy-makers. A policy of support for new nuclear power generation and offshore wind has been based not only on the need to reduce carbon dioxide emissions, but also on the argument that fossil fuel prices are set to run ever-higher.

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Russia’s anti-fracking push taking to the streets?

We don’t post too many things on The Barrel that are merely links to other groups’ works. But this one was too good not to pass along, if you haven’t seen or heard about it already.

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What price European natural gas independence?

If you are a state-run gas company in a Baltic state–once part of the Soviet Union, and tied to the former empire by gas pipelines–you might grab with both hands the chance to buy gas from someone who is not associated with the Kremlin.

Lithuania has asserted its independence from Russian gas by chartering a floating liquefied natural gas import terminal, the Independence, from Hoegh. The first LNG cargo came under a five-year contract in November. The seller was Norway’s Statoil, which operates Europe’s only liquefaction plant, Snohvit.

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Australian junior chases Rocky Mountain oil and natural gas high

A small Australian upstream company, with the appropriate name of American Patriot Oil and Gas, is hoping to achieve what several of its peers have been unable to do: turn a little into a lot in the US market.

American Patriot’s business model is simple, yet crucially different from that pursued by some other small Australian companies that have burned through their own capital trying to make a go of it in US conventional and unconventional oil and gas, according to the company’s CEO Alexis Clark.

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A strong frac sand market faces lower oil and natural gas prices

Not every price in the energy complex is dropping.

According to an index created by Cowen & Co., the producer price index for frac sand rose 1% in October, following a 1% gain in September. At the end of October, it was at its highest level since the end of 2012.

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The great LNG indexation debate rumbles on

Almost three years since the first contracts based on Cheniere Energy’s tolling model were signed, the great LNG indexation debate continues to rage. Only this year, the focus has shifted to how competitive those US volumes will be in the wake of falling crude prices; a complete about-turn from the last few years.

With crude oil prices touching four-year lows of around $80/b, it’s not hard to imagine a world where US exports under Cheniere’s tolling model could become uneconomic, especially if US gas prices start to rise as many analysts forecast.

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Petrodollars: Figuring out what to do with PNG’s new LNG wealth

As Papua New Guinea enters the small fraternity of LNG exporters, it needs to figure out what do with the money the poor nation is going to earn. Christine Forster looks at the issue in this week’s Oilgram News column, Petrodollars.

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Oil and the elections, through the eyes of a DC analyst

Kevin Book, Christi Tezak and the other partners at ClearView Energy Partners always have some unique perspectives on the intersection of politics and energy.

So here are a few nuggets from their post-Election Day wrap-up:

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More twists coming for PNG’s emerging LNG industry?

It seems there might still be some twists and turns in the long saga of InterOil’s Papua New Guinea LNG project, with analysts speculating that arbitration proceedings launched by Oil Search are ultimately aimed at replacing joint venture partner Total with ExxonMobil.

Oil Search clearly sees itself as the key player in the Pacific nation’s emerging gas sector, by virtue of its 29% stake in the new ExxonMobil-led PNG LNG facility near Port Moresby and its significant equity position in the InterOil project. Oil Search, with its strong operating history at PNG oil and gas fields, also enjoys a good relationship with the PNG government, one of its major shareholders.

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