Saturday, 31 July 2010

Sabah needs to develop own oil and gas sector

Sabah should utilize the natural gas to be sourced from the Sabah Oil and Gas Terminal (SOGT) project in Kimanis to develop its own high revenue oil and gas industry, said Minister of Industrial Development Datuk Raymond Tan Shu Kiah.

Tan said he had forwarded a proposal to Petronas to have some of the gas from the SOGT to be given to Sabah to attract investors to come in and tap the resource to set up their operations in the State.

“If gas is available, industry players will be coming in to set up their activities here. People who are using gas will come in and other players will come in too to provide the support facilities and services, people like the suppliers.

“This is what we are hoping to do and we will continue to generate interest in this field by telling investors and industry players what are the opportunities available here,” he told reporters after visiting Sabah’s first Asean Oil and Gas Expo (AGEX) at Sabah Trade Centre here yesterday.

The three-day event, which ends on Saturday, features a wide array of international exhibitors including those from Malaysia, Singapore, UK, US, China, Korea, Italy, Germany, Taiwan and Japan.

Tan stressed Sabah would not need to send all its gas to Bintulu provided it can develop industrial activities to utilize the highly priced natural resource.

Although the pipes were already being built to send gas to Bintulu as planned, he said the gas can be made available for Sabah so it can attract investors to come in.

“But we have to do something to allow the industry to be developed, otherwise that will be all we do, sending our gas to Bintulu and receiving royalty.

“It would be much better for us (to have our own oil and gas industry) than to just send the gas to Bintulu. That is why there is an urgency to have industrial activities started in Sabah to tap the gas from SOGT,” he said, noting that works to set up the Terminal in Kimanis were progressing well.

According to Tan, Petronas has been very supportive of Sabah’s effort to develop its own vibrant oil and gas industry and has agreed to find a workable solution to allow Sabah to keep some of its own gas.
Tan (left) visiting one of the exhibition booths at the Sabah Trade Centre

“We want oil and gas to create economic activities in Sabah, in line with efforts to generate downstream activities and create high income community.

“It is not just the landing of gas in Sabah but also the planning of oil and gas activities in the State and this includes efforts to provide the infrastructure and human resources required,” said Tan.

He said Petronas was willing to assist Sabah in developing trained and skilled human resources for its oil and gas industry through various levels of training programmes.

He added the company was willing to invest further in Sabah’s human resources development and the CEO himself has asked him to discuss the matter with the Chief Minister Datuk Seri Musa Haji Aman.

On AGEX, he said the event was timely as it brought major names in oil and gas sector into Sabah where investment opportunities can be highlighted or even discovered.

Currently the biggest oil and gas exhibition in Borneo, the event is expected to receive at least 5,000 visitors and generate sales of up to RM100 million.

“The organizer is very brave as a project of this nature is never a small undertaking and it is very significant as Sabah needs to know and bring in the players in the industry.

The exhibitors here are well known brands in oil and gas, with most of them suppliers and partners of Petronas.

“We will continue to organize this kind of activity to create awareness on the opportunities available in oil and gas Sabah,” he said.

Source : Sabah Times

Friday, 30 July 2010

New Oil Spill Hits Michigan Kalamazoo River

Raul Vervuzco of Eagle Services uses a suction hose to
clean oil from atop the Kalamazoo River

Michigan and the Gulf Coast don't have much in common -- except a battle against oil-infused waters.

The Kalamazoo River is the new recipient of 800,000 gallons of crude oil, resulting from an underground pipeline in the Midwest, spanning across Canada and the United States. Estimates suggest approximately 19,500 barrels surged through the river and its surrounding area as a result. The pipeline is owned by a company called Enbridge Energy Partners. Discovered on Monday morning, the leak was plugged shortly thereafter as the pipeline's operators ceased oil flow through the line.

Several residents have been compelled to evacuate, and officials have closed access to the river. Cleanup efforts on behalf of Enbridge are now being doubled as federal and state officials begin the push to stop the oil's infiltration into the water before it hits a nearby lake.

Patrick Daniel, Enbridge's chief executive announced: “Our intention is to return your communities to its state before the spill”. He also offered: “We still have a lot to work to do.”

Steady crude oil prices spur deepwater projects in M'sia

Deepwater drilling for oil in Malaysian waters is moving into high gear with the arrival of specialised drillships in the coming months, analysts said.

Yesterday Petronas Carigali Sdn Bhd’s head of deepwater development Rosli Hamzah was quoted in Singapore as saying that Transocean Ltd’s drillship Deepwater Expedition would arrive in Malaysian waters in September, while the second ship Frontier Phoenix was scheduled to be in by November.

“The average day rates for drillships capable of operating at depths over 4,000 ft (1.2km) are presently around US$425,000 a day. This is above semi-submersible day rates of US$309,000 and US$399,000 a day,’’ AmResearch analyst Alex Goh said yesterday.

Transocean is the world’s largest offshore drilling contractor with 139 mobile offshore drilling units plus three ultra-deepwater units under construction.

Rosli said Malaysia needed three drillships between 2010 and 2015 as deepwater areas will make up for as much as 40% of the country’s oil output in 10 years.

Currently deepwater accounts for 4% of Malaysian oil and gas production that totalled about 1.6 million barrels of oil equivalent a day.

Crude oil production stood at about 657,000 barrels a day, down from more than 750,000 barrels a day a few years back.

Deepwater exploration and production (E&P) is a relatively new venture in this region. Deepwater project often refers to drilling activities at depth of 1,000 ft below the oceon floor.

With crude oil price in the international market keeping above US$70 per barrel, this previously prohibitively expensive and risky venture appears to be the main part of Petronas’ gambit to boost the country’s stagnant domestic oil reserves of 20 billion barrels of oil equivalent.

The drillships’ arrival, according to AmResearch’s Goh, highlighted Petronas’ commitment to re-direct capital expenditure to its home market. As it is, the first deepwater oil production in the country, known as Kikeh field 110-km off the Sabah coast, started production about three years ago.

Recent reports suggested that development activities at the Gumusut and Kakap fields are picking up pace, and the two fields are targeted for production in 2012.

Meanwhile, early estimate showed the next three deepwater fields in Malikai, Kebabangan and Jangas would cost a further RM13bil to develop, CIMB Research said in a recent review on the industry.

Petronas has budgeted RM40bil on capex for the year ending March 31, 2011, and some estimate suggested that RM11bil would be spent on deepwater projects over the next few years.

Source : The Star

Thursday, 29 July 2010

BP posts $17bn loss after oil spill

BP has reported a record quarterly loss of $17bn in the wake of a major oil spill that it has been trying to stop for months with limited success.

The company also announced it planned to sell assets worth up to $30bn over the next 18 months and cut its net debt to between $10bn and $15bn in that period.

News of one of the biggest losses in British corporate history came on Tuesday as BP named a US executive to replace Tony Hayward, the company's chief executive blamed for failing to deal with the worst oil spill in US history.

The company said that Robert Dudley, who is managing director and is in charge of the oil spill clean-up, would take over Hayward's position as of October 1.

"We are going to hold ourselves to a higher standard. I suspect that the American people and the regulators in the United States will hold us to a higher standard. That seems reasonable to me and we are going to respond to that and we are going to change," Dudeley said in an interview with ABC News.

"I think sometimes events like this shake you to the core, the foundation, and you have two responses: one is to runaway and hide; the other is to respond and really change the culture of the company and make sure all the checks and balances are there, just to make sure this does not happen again."

Dividend payments

The company said it would consider its position on future dividend payments at the time of its fourth-quarter results.

Analysts had expected BP to set aside tens of billions of dollars to cover the cost of the April 20 oil rig explosion that killed 11 people, ruined the Gulf's fishing and tourism industries, and polluted the Gulf shoreline with slimy goo.

Dudley said the accident that lad to the oil spill "came out of nowhere", and dismissed the company's safety record as outdated.

"Many of those accidents occurred about a half-a-decade ago and that's what you see rolling through in terms of those safety violations,” Dudley said.
  • $32.2 billion set aside for cleanup costs
  • BP plans to sell $30bn in assets over next 18 months
  • $16.97bn lost in second-quarter earnings
  • Company stock down 37.7% over last three months
"When Tony Hayward did come in he laid the foundations for a strong focus on safe and reliable operations and the company has been moving in that direction, it takes some time."

After BP's announcement of a replacement, Hayward said: "I believe that it is not possible for the company to move on in the United States with me remaining as the face to BP.

"So I think that for the good of BP, and particularly for the good of BP in the United States, it is right for me to ... step down."

Hayward is reportedly leaving with a total pay-off and pension package worth around $18.5m, and will be appointed as a non-executive director at TNK-BP as part of his departure deal.

He became a controversial figure due to his handling of the environment crisis that developed after after an explosion in April that killed 11 workers and caused the Deepwater Horizon rig to sink.

The destroyed wellhead in the Gulf of Mexico seabed gushed millions of barrels of oil into the waters off the southern US coast.

Public relations gaffes

BP capped the leaking well last week after a series of failed attempts to stem the leak over the last three months.

Hayward has been criticised for a string of public relations gaffes during the crisis, at one point included telling reporters "I want my life back".

BP said that it "will be a different company going forward, requiring fresh leadership", but defended the outgoing chief's performance.

"The BP board is deeply saddened to lose a CEO whose success over some three years in driving the performance of the company was so widely and deservedly admired," BP Chairman Carl-Henric Svanberg said in a statement.

Dave Kansas, the Wall Street Journal's European markets editor in London, told Al Jazeera that Dudley had been favourite for the post of chief executive because of his handling of the clean-up.

"He [Dudley] grew up on the Gulf coast in Mississippi ... he's received high praise from some of the government officials around the BP situation," he said.

"The PR piece of this looks like it's probably sliding into a place that BP would like."

He said that having an American take the chief executive slot was also important for the company given the widespread criticism it has faced from politicians and the public across the US.

Clean-up costs

Despite the steep costs of cleaning up the massive oil spill and the expected government fines, BP has sought to reassure investors that it continues to remain a strong company.

David Strahan, an energy analyst and author of the book The Last Oil Shock, backed up those assertions.

"There's no way this company's going to go bust as a result of this, despite the eyewatering size of the numbers," he told Al Jazeera.

But he said the amount BP has set aside to cover costs may not be large enough.

"I'm not sure that they have yet set aside enough to cover all of their liabilities, although I don't doubt that they could fund them, even if their numbers go up," he said.

Of the $32bn set aside, $20bn has already been pledged to payout claims made by those affected by the spill. The company's has also spent around $4bn of that money containing the disaster, leaving only $8bn for fines and other costs.

The news of Hayward's departure followed a weekend announcement that BP would finish installing the last bit of pipe into a relief well engineered to help permanently plug its oil spill in the Gulf of Mexico in the coming week.

Once the pipe is cemented in place, BP is supposed to begin a "static kill" sealing process in the first week of August.

The operation aims to seal the well by pumping heavy drilling mud through the blowout preventer valve system that sits on top of the well and then injecting cement inside to seal it.

Source : Al-Jazeera

Wednesday, 28 July 2010

MISC submits applications for Malaysia Marine listing

MISC Bhd has submitted applications to the Securities Commission (SC) and the International Trade and Industry Ministry for the proposed listing of subsidiary Malaysia Marine and Heavy Engineering Holdings Bhd (MHB).

The group said in a statement that it has also submitted an application to the SC's syariah advisory council for the nod to classify MHB's entire enlarged issued and paid-up share capital as a syariah-compliant security on completion of the proposed listing.

MISC, the world's biggest owner of liquefied natural gas tankers, recently said it intended to list 25.5 per cent of MHB on Bursa Malaysia's Main Board by the fourth quarter.

It would sell sell 9.1 per cent, or 146 million MHB shares, to institutional investors, and 16.4 per cent, or 262 million shares, to the public.

MHB posted a net income of RM279 million in financial year ended March 31 2010, compared with RM278 million previously.

Source : Business Times

Tuesday, 27 July 2010

MISC to offer 25pc of engineering unit via IPO

MISC Bhd, the shipping arm of the state oil firm Petronas, will sell a 25.5 per cent stake in its heavy engineering unit under a proposed initial public offering (IPO).

MISC said on a statement late on Friday that it will sell 146 million shares of its unit Malaysia Marine and Heavy Engineering Holdings (MMHE) to institutional investors via a bookbuilding exercise.

The public issue will comprise of 262 million shares and will involve MISC shareholders.

“The proposed listing will enable MISC and its subsidiaries to accelerate the growth of its offshore and heaving engineering divisions,” MISC said.

The IPO is expected to be completed in the fourth quarter and will boost MMHE’s share capital to RM2.5 billion, the shipping company said.

MMHE will also make a cash dividend payout of RM300 million to MISC.

MISC said it plans to use the proceeds from the share sale to institutional investors as capital expenditure while proceeds from public will fund an upgrade of its yard in Johor and additional expenditure for operations in Turkmenistan.

MISC hired Credit Suisse and Maybank for the IPO that was expected to raise over US$300 million (RM960 million), said IFR, a Thomson Reuters service. — Reuters

Source : The Malaysian Insider

BP boss set to quit with a £10m pension

Under the terms of his contract, Mr Hayward is entitled
to current salary and benefits on his departure

Tony Hayward was in talks over the weekend about leaving his position as chief executive. His departure is due to be finalised at a board meeting today. A public announcement is likely by tomorrow morning.

Talks about Mr Hayward’s exit have centred on his severance package, which is politically sensitive and could prompt a new row with the American government.

The 53-year-old’s pension pot will pay out £584,000 a year when he turns 60, but the terms of his departure from BP could allow him to draw down the pension earlier.

The BP board is eager to avoid further political criticism but Mr Hayward is believed to want the severance deal to reflect his 28 years of service to the company, which could run into millions.

The chief executive faced heavy criticism for his handling of the Gulf of Mexico oil spill after saying the environmental impact would be “very, very modest” and “I want my life back”.

Following Mr Hayward’s comment on the crisis, President Obama said: “He wouldn’t be working for me after any of those statements.”

Under the terms of his contract, Mr Hayward is entitled to “current salary and benefits” on his departure, which would be at least £1.04 million.

Last year, he earned a total of £4.56 million – including the £1.04 million salary, a £2.09 million annual bonus, a £852,000 long-term incentive payment and £440,000 from cashing in 220,000 share options. BP is keen to avoid a Royal Bank of Scotland style controversy for “rewarding failure”.

A political row broke out in 2008 when the pay-off for Sir Fred Goodwin, the shamed RBS chief executive, was disclosed. Sir Fred’s pension pot was doubled to £16 million, guaranteeing him £693,000 a year for the rest of his life.

The man who replaced Mr Hayward as the leader of BP’s response to the Deepwater Horizon crisis, Bob Dudley, is expected to be confirmed as the company’s new chief executive.

Mr Dudley grew up in Mississippi and would become the first non-British BP chief executive. In the role, he will have the task of restoring the company’s battered finances and reputation, allowing it to fight off any hostile takeover.

Mr Dudley has overseen an improvement in BP’s fortunes during the Gulf of Mexico crisis. The company has stopped oil seeping from the seabed and is close to completing a relief well that should seal off the leak.

The departure of Mr Hayward is expected to be announced alongside the company’s half-year results tomorrow. BP is forecast to post a pre-tax loss of up to $25 billion (£16 billion), which would be the biggest ever quarterly loss by a British company, after making provisions for the cost of the oil spill.

Source :

Venezuela threatens oil cut to US

Hugo Chavez, Venezuela's president, has threatened to cut off oil exports to the United States if US-allied Colombia launches a military attack against his country.

"If there was any armed aggression against Venezuela from Colombian territory or from anywhere else, promoted by the Yankee empire, we would suspend oil shipments to the United States even if we have to eat stones here," Chavez said on Sunday.

He added that he had cancelled a trip to Cuba because he had intelligence revealing that "the possibility of an armed aggression against Venezuelan territory from Colombia" was higher than it has been "in 100 years".

Chavez, a leftist and vocal critic of the United States, broke off diplomatic relations with Colombia last week over claims by the outgoing Colombian President Alvaro Uribe, a close US ally, that his country harbours Colombian rebels.

'Bogus show'

Uribe had said that top commanders of the rebel Revolutionary Armed Forces of Colombia, or Farc, have taken refuge in Venezuela and were launching attacks against Colombian troops.

The Colombian government had presented photos, videos and maps of what it said were Colombian rebel camps inside Venezuela to the Organisation of American States.

Chavez has dismissed the accusations as a bogus show intended to smear his government and has said that Uribe could be trying to lay the groundwork for an armed conflict with Venezuela.

The Colombian government denies seeking a conflict and says it went to OAS with its evidence about the rebels last week because Chavez's government had not taken steps to address the situation.

The United States threw its support behind its key ally Colombia, calling Chavez's decision to sever diplomatic relations and put border troops on alert "a petulant response" to Bogota's accusations.

Source : Al-Jazeera

Fuel Pump Problems Continue To Spread

Embattled Pertamina, under fire for a rash of explosions involving
state-subsidized gas cylinders, is facing further criticism for the poor
quality of its Premium gasoline

Blue Bird has been joined by another taxi company as well as an auto distributor in complaining about broken fuel pumps in their cars causing breakdowns, while state oil company PT Pertamina continued to stand behind its Premium gasoline, saying it was not the problem.

Express Group president director Daniel Podiman said on Sunday that about 40 of the company’s taxis were suffering broken fuel pumps each day. All of the affected cars were Toyota Limos, the same model used by the Blue Bird Group.

“This has been happening for the last few weeks. However, we can’t conclude whether the problem is caused by poor-quality Premium fuel supplied by Pertamina or by Toyota’s fuel pumps,” Daniel said.

Also speaking on Sunday, PT Hyundai Motor Indonesia president director Jongkie Sugiarto said the distributor had seen a sudden rise in requests for fuel pumps over the past few weeks. “Yes, there is a surge in fuel pump demand based on reports from our dealers, but we don’t know what’s causing it,” he said.

He said Hyundai was investigating what type of cars were experiencing the problem, where they were filling up and the damage to their pumps.

Last week, Blue Bird, the country’s largest taxi company, announced that 1,200 of its Toyota Limo taxis had experienced pump failures since early June. It blamed substandard Premium fuel for a build-up of sediment in the pumps and said Pertamina may be liable for repair costs, which it estimated at Rp 20 billion ($2.2 million).

Both Blue Bird and Express purchase subsidized Premium gasoline exclusively from Pertamina at discounted rates. Blue Bird buys around 5.7 million liters of fuel per month for its 11,000 taxis nationwide, according to Pertamina.

The oil company, meanwhile, has strenuously denied allegations that its Premium fuel is to blame for the fuel pump problems.

Speaking on Friday, Pertamina president director Karen Agustiawan challenged Blue Bird to prove that Pertamina had downgraded the quality of its Premium fuel.

“Whoever thinks that our Premium fuel is bad can go ahead and prove it. But if it turns out that Pertamina is right and they are wrong, I will sue them,” she said.

Karen said recent spot tests of fuel had proven that the quality of Premium fuel was well within the range the government deems acceptable.

Last week, Pertamina undertook checks on Premium gas sold at 16 stations in Greater Jakarta to monitor for possible quality problems with the fuel. On Friday, it announced that levels in all of the tested samples met state requirements for octane and sulphur content. Low octane in fuel can clog fuel pumps as can high levels of sulphur, eventually leading to breakdowns.

Johny Darmawan, president director of PT Toyota Astra Mobil, said on Friday that he was aware that Pertamina had carried out quality tests on its fuel. “However, we are still wondering why there are so many cars experiencing breakdowns, and not just Toyotas,” he said.

Johny said the company planned to sit down with Pertamina next week in an attempt to find a solution to the problem. In the meantime, the car distributor was focusing on fulfilling the increased demand for fuel pumps, he said.

Commenting on the fuel pump debate, Danang Parikesit, chairman of the Indonesian Transportation Community, blamed the ongoing problems on insufficient government oversight and called for independent testing of the fuel as soon as possible.

“The Energy and Mineral Resources Ministry needs to increase scrutiny on Premium fuel quality. If it can’t do that, it should appoint an independent watchdog to it,” he said.

Source : Jakarta Post

Related articles : Pertamina to Cease Imports of Petroleum In 2017 After Refinery Projects Are Completed

Monday, 26 July 2010

MISC to offer 25.5% of MMHE

MISC Bhd is proposing to list wholly-owned Malaysia Marine and Heavy Engineering Holdings Bhd (MMHE) on the Bursa Malaysia main market via the offer for sale of 25.5% or 408 million of the enlarged paid-up capital of 1.6 billion shares.

Maybank Investment Bank Bhd on behalf of MISC said the proposed initial public offering (IPO) scheme would involve an increase in MMHE’s authorised share capital to RM2.5bil comprising five billion 50 sen shares and a one-into-two share split of existing shares.

MMHE proposed to undertake a cash dividend payout of RM300mil to MISC and a bonus issue of 1.3 billion shares of about 40.245 bonus shares for every one MMHE share.

Upon completion of the proposals under the IPO scheme, MMHE would undertake a proposed IPO involving an institutional offering and a public issue.

The institutional offering would comprise 146 million shares or a 9.12% stake in the company at a price to be determined via a bookbuilding exercise. The public issue would comprise 262 million new shares or a 16.38% stake in the company, of which 32 million shares or a 2% stake would be allocated via balloting to the public.

Source : The Star

Sunday, 25 July 2010

Technician: Deepwater Horizon warning system disabled

KENNER, LA. -- Long before an eruption of gas turned the Deepwater Horizon oil rig into a fireball, an alarm system designed to alert the crew and prevent combustible gases from reaching potential sources of ignition had been deliberately disabled, the former chief electronics technician on the rig testified Friday.

Michael Williams, an ex-Marine who survived the April 20 inferno by jumping from the burning rig, told a federal panel probing the disaster that the alarm system was one of an array of critical systems that had been functioning unreliably in the run-up to the blowout.

Williams told the panel that he understood that the rig had been operating with the gas alarm system in "inhibited" mode for a year to prevent false alarms from disturbing the crew.

He said the explanation he got was that the leadership of the rig did not want crew members needlessly awakened in the middle of the night.

If the safety system was disabled, it would not have been a unique event. Records of federal enforcement actions reviewed by The Washington Post show that, in case after case, rig operators paid fines for allegedly bypassing safety systems that could impede routine operations.

Computers used to monitor and control drilling operations intermittently froze, to the point that the problem became known as "the blue screen of death," Williams said. Despite attempted repairs, the issue remained unresolved at the time of the blowout, Williams said.

Earlier in the drilling operation, one of the panels that controlled the blowout preventer -- the last line of defense against a gusher -- had been placed in bypass mode to work around a malfunction, Williams said.

Williams said a colleague told him that an inspection of the rig in the spring, shortly before the disaster, found extensive maintenance problems. The colleague said "that we were going to be in the shipyard a lot longer than anticipated because the rig was in very bad condition," Williams said.

The rig was owned by Transocean, the company that employs Williams, and was operating under contract to BP.

An attorney for BP, Richard Godfrey, added to the picture by reading from a September 2009 BP audit during his questioning of Williams. He read a litany of findings that included problems with bilge pumps, cooling pumps, an alarm system related to the rig's hospital and an emergency shutdown panel on the bridge.

A fire and alarm system was found to have its "override active," Godfrey said.

Altogether, the September audit identified 390 issues that needed addressing, Godfrey said.

Williams said the fire and gas system was "a wreck" when he took over his job in 2009, and trying to improve it was a constant battle.

Every member of the Deepwater Horizon crew had the authority to stop operations if they had safety concerns. Despite his unease, Williams said he never exercised that power. In days of testimony here by a parade of witnesses, that has been a recurring theme.

Williams said that when he discovered that the alarm system was "inhibited" he reported it to supervisors, and they informed him that orders were to keep it that way.

In the event of a gas leak, the rig was equipped to shut down vents that could transmit the gas to the engine rooms, where it could ignite.

But there was no guarantee the system would work.

When it was accidentally triggered once, Williams said, the suction from the engine was so great that it pulled a fire door off its hinges.

On the night of April 20, Engine No. 3 appeared to have exploded, Williams said.

Questioned by Transocean lawyer Edward F. Kohnke IV, Williams said he has filed a lawsuit over the disaster.

Williams also said that, when he gave a statement in the presence of the Transocean lawyer before retaining a lawyer of his own and filing suit, he did not mention the problems he discussed at Friday's hearing.

Williams, who was injured in the explosion, was taken by helicopter from a rescue ship to a Louisiana hospital. Transocean lawyers interviewed him in a Kenner hotel about a day after the blowout, said his attorney, Scott R. Bickford.

Transocean said in a statement that the Deepwater Horizon's general alarm system was controlled by a person on the bridge "to prevent the general alarm from sounding unnecessarily." Transocean provided part of an April inspection report that found "no [gas] detectors either in fault or inhibited condition, other than units being serviced."

U.S. Coast Guard Capt. Hung Nguyen, co-chairman of the investigating panel, asked if Williams's experience pointed to a systemic maintenance problem.

"There's never enough time," Williams said.

Getting replacement parts contributed to the delay, he said.

"Turnaround was horrible," Williams said. "I waited on parts for a year."

The main problem was that some parts were no longer manufactured, Williams said, and Transocean had to have them custom-made.

The Coast Guard and the Bureau of Ocean Energy Management, Regulation and Enforcement, until recently called the Minerals Management Service, are conducting the hearing.

In other testimony Friday, an expert consultant to the investigating board said that based on available data, it appeared that the Deepwater Horizon conducted four faulty integrity tests on the well in the hours before the blowout.

The fact that the test was apparently attempted four times indicates that someone on the rig was concerned, said John R. Smith, an associate professor of petroleum engineering at Louisiana State University and a consultant to the board.

"None of the four tests were an acceptable test," Smith said.

Apparently, when BP concluded the tests, hydrocarbons were already flowing up the well, said Smith, an industry veteran.

Going on the assumption that at least one of the tests was successful, BP prepared to wrap up its work on the well by removing heavy drilling fluid from the hole. The fluid serves as a damper on the well, and removing it eliminated a counterweight to a potential gusher.

Source : Washington Post

Saturday, 24 July 2010

India unveils prototype of $35 tablet computer

MUMBAI, India – It looks like an iPad, only it's 1/14th the cost: India has unveiled the prototype of a $35 basic touchscreen tablet aimed at students, which it hopes to bring into production by 2011.

If the government can find a manufacturer, the Linux operating system-based computer would be the latest in a string of "world's cheapest" innovations to hit the market out of India, which is home to the 100,000 rupee ($2,127) compact Nano car, the 749 rupees ($16) water purifier and the $2,000 open-heart surgery.

The tablet can be used for functions like word processing, web browsing and video-conferencing. It has a solar power option too — important for India's energy-starved hinterlands — though that add-on costs extra.

"This is our answer to MIT's $100 computer," human resource development minister Kapil Sibal told the Economic Times when he unveiled the device Thursday.

In 2005, Nicholas Negroponte — cofounder of the Massachusetts Institute of Technology's Media Lab — unveiled a prototype of a $100 laptop for children in the developing world. India rejected that as too expensive and embarked on a multiyear effort to develop a cheaper option of its own.

Negroponte's laptop ended up costing about $200, but in May his nonprofit association, One Laptop Per Child, said it plans to launch a basic tablet computer for $99.

Sibal turned to students and professors at India's elite technical universities to develop the $35 tablet after receiving a "lukewarm" response from private sector players. He hopes to get the cost down to $10 eventually.

Mamta Varma, a ministry spokeswoman, said falling hardware costs and intelligent design make the price tag plausible. The tablet doesn't have a hard disk, but instead uses a memory card, much like a mobile phone. The tablet design cuts hardware costs, and the use of open-source software also adds to savings, she said.

Varma said several global manufacturers, including at least one from Taiwan, have shown interest in making the low-cost device, but no manufacturing or distribution deals have been finalized. She declined to name any of the companies.

India plans to subsidize the cost of the tablet for its students, bringing the purchase price down to around $20.

The project is part of an ambitious education technology initiative, which also aims to bring broadband connectivity to India's 25,000 colleges and 504 universities and make study materials available online.

So far nearly 8,500 colleges have been connected and nearly 500 web and video-based courses have been uploaded on YouTube and other portals, the Ministry said.

Source : Associate Press

ONGC on inside track for BP Vietnam stake

BP's woes may enable India to get the upper hand over China for at least one coveted energy asset.

India's state-run Oil and Gas Natural Corp is well-positioned to buy the embattled UK firm's 35 percent stake, worth $966 million by one estimate, in an offshore Vietnamese gas field in which it already owns 45 percent.

China's CNOOC and Sinopec, and Thailand's PTTEP are also likely to show interest in BP's stake, bankers and analysts familiar with the asset told Reuters last week, although ONGC's presence in the project gives it an edge.

A deal would be a welcome change for India, which has been playing the underdog to China in the hunt for natural resources as the two Asian countries seek energy security to feed fast economic growth.

Hanoi insists BP give priority to its partners in the project.

BP is scrambling to raise billions to pay for the Gulf of Mexico disaster, the worst oil spill in U.S. history, and ONGC and PetroVietnam, which owns the rest of the project, are waiting to pounce and capitalise on the British giant's vulnerability.

India, whose plodding approach to overseas deals has allowed other targets to slip away, appears to be moving quickly this time to clinch a deal.

India's oil minister and the head of ONGC both said the company may make a joint bid with state-owned PetroVietnam.

"Just now I have met the Vietnam prime minister," Oil Minister Murli Deora told Reuters on Thursday.

"In principle, he has agreed to our proposal. Now we have to negotiate with BP," said Deora, who is in Vietnam along with other government officials and executives from Indian oil and gas firms to boost ties in the energy sector.

Vietnam Prime Minister Nguyen Tan Dung welcomed greater investment from India in the oil and gas sector, India's petroleum ministry said in a statement.

Analysts said a deal makes strategic sense for ONGC.

"ONGC has been looking at assets globally, and they haven't had much success over the last 12 to 18 months," said Atul Rastogi, analyst at Daiwa Securities SMBC Co Ltd.

"They already have a stake, they know the field, they know the asset, so in that sense it's probably better than going to a completely new area," Rastogi said of Nam Con Son.


ONGC's plan to form a joint venture with PetroVietnam could help it secure a deal, a source who has advised ONGC on previous M&A transactions told Reuters.

ONGC has yet to mandate banks to advise it on its interest in BP's stake. Bankers, some experts say, are unlikely to be closely involved in a deal as the companies and governments may work out a structure on their own.

"The deal is likely to be played out between these government-run companies," the source said.

The person was not authorised to speak publicly about the matter and declined to be named.

A BP spokesman said the company was "exploring divestment options" for its interest in the Nam Con Son gas project, which comprises stakes in the Lan Tay and Lan Do gas fields, the Nam Con Son pipeline and the Phu My power generation project.

As of late Thursday, it was still unclear what structure the bid from ONGC will take.

R.S. Sharma, ONGC's head, told Reuters the firm may join with state-run Oil India and GAIL to buy BP's stake.

"We may take Oil India and GAIL with us. Modalities are being worked out. We may partner PetroVietnam. It all depends on discussions and negotiations," Sharma told Reuters from Vietnam.

India's plodding state energy and mining firms are trying to raise their game. Firms such as ONGC, Coal India and Indian Oil Corp have been promised more autonomy as they look overseas for deals.

"A lot of pressure is coming from the government of India because, strategically, they have to reduce dependence on imports, and like China one way is to acquire stakes in assets abroad," Rastogi said.

"But they have been slow. Part of the reason is they have to get government approval... and they've lacked the flexibility to go out and bid aggressively."

Source : Reuters

Gulf rig worker survey showed safety concerns

Natural gas is burned off a support vessel above the source of Deepwater
Horizon oil spill where BP will begin testing a new cap placed over the
leak in the Gulf of Mexico off the Louisiana coast July 13, 2010

Workers on the Deepwater Horizon drilling platform in the Gulf of Mexico expressed concern about safety practices a month before the oil rig exploded and sunk, according to a survey conducted by its owner, Transocean Ltd.

But a summary of the report provided by TransoceanRIGN.S (RIG.N) concluded that overall safety management on the rig was "relatively strong," and workers viewed management on vessel in a very positive light.

The safety concerns were first reported in the New York Times, which cited comments in the full survey by workers saying they "often saw unsafe behaviors on the rig" but feared reprisals if they reported mistakes or other problems.

A spokesman for the company said the Times report had taken the criticisms out of context, and had mischaracterized the overall safety culture on the rig.

"Framing this survey solely in a negatively light directly contradicts the inspectors' clearly stated findings," the spokesman, Lou Colasuonno, said in an email.

The Deepwater Horizon rig, leased by BP Plc(BP.N) (BP.N), exploded April 20, killing 11 workers and triggering an unprecedented environmental disaster as oil spilled unchecked from the Gulf sea bed for nearly three months.

BP capped the blown-out well last week, choking off the flow of oil for the first time since the explosion. The company is conducting pressure tests to ensure the seal can hold.

The report's summary said workers aboard the rig felt confident they could approach rig supervisors with their concerns, but that this "was restricted to issues that could be resolved directly on the rig, and that they had little influence at divisional or corporate levels."

"I'm petrified of dropping anything from heights, not because I'm afraid of hurting anyone (the area is barriered off), but because I'm afraid of getting fired," one worker wrote in the survey, according to the Times.

"The company is always using fear tactics," the Times quoted another as saying.

"All these games and your mind gets tired."

The report summary also showed that one third of the workers on the rig believed the 2007 merger of Transocean and its rival Global Sante Fe had negatively affected safety.

Fewer than half the workers surveyed said they felt they could report without reprisal actions leading to a potentially risky situation, such as workers forgetting to do something, damaging equipment or dropping an object from a height.

The summary by Lloyd's said that statistic seemed to contradict the reviewers' appraisal of trust on the rig.

"However, it must be noted that a significant proportion of this is likely to be associated with dropped objects incidents and near-hits, which would align with the reviewers' findings" of the overall safety culture," the report summary said.

Source : Reuters

Other stories :
Oil Rig Alarm Was Not Fully Turned On, Worker Says
Technician: Deepwater Horizon warning system disabled

Friday, 23 July 2010

Storm Threat in Gulf Halts Most Work at Oil Spill Site


Most work was halted at the site of BP’s blown oil well in the Gulf of Mexico on Thursday, as a newly formed tropical depression threatened to delay for a week or more the effort to seal off the gusher permanently using a relief well.

BP was awaiting word from the federal leader of the spill response about whether drill rigs, support ships and other vessels would have to evacuate the area, a company spokesman said on Thursday morning.

The relief well has been temporarily plugged because of the weather worries, the company said on Wednesday. With about two days of work still needed to install and cement a last section of steel casing pipe in the relief well, BP did not want to start the casing work and then have to stop it if evacuation was necessary, so it put the work off until the storm passes. Once the casing is in place, a final week’s worth of drilling would be needed to intercept the bad well.

The National Weather Service said on Thursday that the tropical depression, the third so far in what is expected to be a busy hurricane season, had formed in the Bahamas. Its track was expected to run to the northwest into the Gulf of Mexico. It would not reach the Gulf for several days yet, the weather service estimated. But when it does, depending on its path and how much it intensifies, some or all of the ships and rigs at the well site could be forced to leave for safer water.

No decision has been made yet on whether to attempt another well-sealing procedure, called a static kill, in which heavy drilling mud would be pumped into the well in an effort to permanently stop the flow of oil and gas. That procedure, if approved by a government technical team, would only begin after the final casing was installed in the relief well, to reduce the risk of damage to the relief well if something went wrong.

The leader of the response effort, Thad W. Allen, a retired Coast Guard admiral, said if the forecast at the well site was for a severe storm, “we could be looking at 10 to 14 days” when no work could be done on the relief well. Containment projects and other work would have to be suspended as well.Before the tropical depression formed, the relief well was expected to intercept the bad well at the end of July. If the static kill is successful, the only need for the relief well may be to confirm that the well is permanently sealed. If the results from the static kill are ambiguous, though, it would then take at least several days, and perhaps several weeks, to permanently shut the flow from the bad well by pumping mud down the relief well.

Admiral Allen said no decision had been made yet about whether the bad well, which is now capped as part of a test to see whether it can hold pressure, would be left in that condition. After gushing for nearly three months following an explosion and fire that sank a drilling rig, the well has not leaked any oil since last Thursday, when valves on a cap atop it were closed to start the pressure test. If officials decide that it is too risky to leave the well under pressure during a storm, the valves would be reopened and oil would once again spew into the gulf.

Admiral Allen said it was possible that the well would be left shut during a storm but would be closely monitored by remotely operated submersibles for as long as possible. The submersibles, and their relatively fast-moving support ships, would probably be away from the site for only three or four days, he said.

Kent Wells, a BP senior vice president, said on Wednesday that the pressure tests continued to show favorable results. “We have no evidence the well does not have integrity,” he said. “Every day we go longer gives us more confidence.”

Clifford Krauss contributed reporting.

Source : The New York Times

Other news :
BP monitoring storm, spill operations continuing
BP oil spill repairs face further delay with tropical storm warning

Confidence in Oil Well Cap Growing; End Near?

With confidence in the cap that is currently sealing the ruptured oil well in the Gulf of Mexico on the rise, BP and representatives of the federal government are moving forward with plans to permanently halt the flow of oil that has caused one of the largest natural disasters in U.S. history.

Early Wednesday morning, AFP reporter Alex Ogle stated that officials at the petroleum company were "gaining confidence" in the cap, but that the seal was still under evaluation.

"We're just going to continue on with the tests. And every day that we continue on with the tests, that gives us more confidence when we don't see any anomalies," BP vice president Kent Wells told reporters during a Tuesday press briefing.

"We continue to be pleased with the progress," added retired Coast Guard Adm. Thad Allen, who is heading up the government's response to the spill, according to Associated Press (AP) reports. Allen also noted that a relief tunnel is expected to reach the well by the weekend, which according to the AP means that "the three-month-old gusher could be snuffed for good within two weeks."

Ogle notes that the apparent success of the tunnel does not mean that relief workers have ruled out the possibility of a "static kill"--the use of materials to seal off the flow sooner.

Coast Guard Cutter Walnut, a 225-foot sea-going buoy tender based in Honolulu, skims oil
July 16 near the BP oil spill site with the help of a barge and a tugboat. The Walnut has
been skimming since it arrived in the Gulf after transiting the Panama Canal.

"The relief well is exactly where we want it, pointed in the right direction. So we're feeling good about that," Wells said. "The intercept of the Macondo well is still for the end of July and then the kill procedure, dependent upon whether we have flow up the annulus casing or both, could take anywhere from a number of days to a few weeks."

Meanwhile, environmentalists and those involved in the clean-up of past oil spills have publicly started criticizing some of the methods used in the Gulf recovery effort, according to a Wednesday article by the AP's Cain Burdeau. Burdeau reports that more than 5,000 vessels have been participating in the clean-up, making it "the largest fleet assembled since the Allied invasion of Normandy."

"Hordes of helicopters, bulldozers, Army trucks, ATVs, barges, dredges, airboats, workboats, cleanup crews, media, scientists and volunteers have descended on the beaches, blue waters and golden marshes of the Gulf Coast," Burdeau adds. "That's a lot of propellers, anchors, tires, and feet for a fragile ecosystem to take, and a tough truth is emerging: In many places, the oil cleanup itself is causing environmental damage."

In addition to the machinery, the use of the chemical dispersant Corexit early in the process has drawn criticism, since marine biology experts are unsure that the product is safe for aquatic life. As Greenpeace USA oceans campaign director John Hocevar told Burdeau, "Basically, we conducted uncontrolled experiments in the open ocean--that does not seem like a good idea to me."

Likewise, critics have blasted Louisiana Governor Bobby Jindal's decision to build sand islands and other barriers along the Gulf coast. While said barriers were designed to block oil from washing up onto the coast, they also are said to interfere with the migration of shrimp and fish. As former coastal restoration advisor Leonard Bahr told the AP, "None of the coastal scientists have signed onto this thing."

Source : Red Orbit

Toyota & Tesla akan memperkenalkan Elektrik RAV4 ke pasaran pada 2012

Tesla Motors and Toyota Motor Corporation Formalize Agreement to Develop Electric Version of RAV4

Palo Alto, California, U.S.A., and Tokyo, Japan - TESLA MOTORS, INC.

(Tesla) and TOYOTA MOTOR CORPORATION (TMC) today announced that the two companies have signed an agreement to initiate the development of an electric version of the RAV4 as announced in May of this year by Elon Musk and Akio Toyoda. With an aim to market the EV in the United States in 2012, prototypes will be made combining the Toyota RAV4 model with a Tesla electric powertrain. Tesla plans to produce and deliver a fleet of prototypes to Toyota for evaluation within this year. The first prototype has already been built and is now undergoing testing.

In May, Tesla and TMC announced their intent to cooperate on the development of electric vehicles, parts, and production system and engineering support. Tesla seeks to learn and benefit from Toyota's engineering, manufacturing, and production expertise, while Toyota aims to learn from Tesla's EV technology, daring spirit, quick decision-making, and flexibility.

TMC has, since its foundation in 1937, operated under the philosophy of "contributing to society through the manufacture of automobiles," and made cars that satisfy its many customers around the world. TMC introduced the first-generation Prius hybrid vehicle in 1997. The company also plans to introduce EVs into the market by 2012.

Tesla's goal is to produce increasingly affordable electric cars for mainstream buyers – relentlessly driving down the cost of EVs. California-based Tesla designs and manufactures EVs and EV powertrain components, and is currently the only automaker in the U.S. that builds and sells highway-capable EVs in serial production.

Official: 'Severe threat' to water, sea life as China oil spill grows

BEIJING (AP) - China's largest oil spill has spread to 430 square kilometers (166 square miles) hundreds of clean up workers struggle to cope.

The official news agency Xinhua says 40 oil-skimming boats and about 800 fishing boats are being used to clean up the spill, and a 15 kilometers (9 miles) oil barrier has been set up to try to stop the slick spreading.

Huang Yong, deputy bureau chief for Dalian, China Maritime Safety Administration, told Dragon TV on Wednesday, "The oil spill will pose a severe threat to marine animals, and water quality, and the sea birds."

The oil slick started spreading five days ago when a pipeline at a busy northeastern port exploded.

China Central Television earlier reported an estimate of 1,500 tons of oil has spilled.

- AP

Firefighter rushes to aid his colleague who
In this photo released by Greenpeace, a firefighter rushes to aid his colleague who ran into trouble amid thick oil cover as they attempted to fix an underwater pump in Dalian, China on Tuesday, July 20, 2010. Crude oil started pouring into the Yellow Sea off a busy northeastern port after a pipeline exploded late last week, sparking a massive 15-hour fire. The government says the slick has spread across a 70-square-mile (180-square-kilometer) stretch of ocean

In this photo released by Greenpeace, a firefighter ...
In this photo released by Greenpeace, a firefighter ...

Oil covered hand of firefighter
In this photo released by Greenpeace, the oil covered hand of a firefighter who was overwhelmed by the thick oil spill while attempting to fix an underwater pump is seen after he is pulled ashore by his colleagues in Dalian, China on Tuesday, July 20, 2010. Crude oil started pouring into the Yellow Sea off a busy northeastern port after a pipeline exploded late last week, sparking a massive 15-hour fire. The government says the slick has spread across a 70-square-mile (180-square-kilometer) stretch of ocean.

In this photo released by Greenpeace, the oil ...

oil washed ashore near the port of Dalian, China on Tuesday, July 20, 2010. Crude oil started pouringinto the Yellow Sea off a busy northeastern port after a pipeline exploded late last week, sparking a massive 15-hour fire. The government says the slick has spread across a 70-square-mile (180-square-kilometer) stretch of ocean

In this photo released by Greenpeace which shows ...
A view shows crude oil in the sea near Dalian
A Greenpeace activist surveys the damage of the ...
China beaches closed after oil spill
A view of the oil spill at Dalians port ...
China recruits 500 fishing ships to fight Dalian ...
In this photo taken Sunday, July 18, 2010, Chinese ...
Firefighters rest in front of a burning oil tank ...
In this Tuesday, July 20, 2010 photo, firemen ...
China uses oil-eating bacteria to clean up spill
China uses oil-eating bacteria to clean up spill
This Saturday July 17, 2010 aerial photo, released ...

Thursday, 22 July 2010

BP admits altering oil spill response centre image

Oil firm BP has admitted posting an altered image of its Gulf of Mexico oil spill response centre on its website.

The picture, posted over the weekend, shows workers in front of a bank of big screens displaying images of its damaged well on the sea floor.

BP spokesman Scott Dean said that three screens were blank in the original photo and Photoshop software had been used to add images.

The altered image was replaced with the original after a US blogger spotted it.
Mr Dean said the photographer who took the photo was displaying his skills with Photoshop software and there was no ill intent.

"Normally we only use Photoshop for the typical purposes of colour correction and cropping," the Washington Post quoted Mr Dean as saying.

"We've instructed our post-production team to refrain from doing this in the future."

Blogger John Aravosis drew attention to the altered image in his

He said: "I guess if you're doing fake crisis response, you might as well fake a photo of the crisis response centre."

Three of these screens were blank in the unaltered photo

He pointed out that the altered image contains jagged crops around one of the worker's heads and that the images of the well inserted into the blank screens do not properly fit the space.

This is the original photo

A cap placed on the leaking well last week has stopped oil gushing from it for the first time since an explosion on the Deepwater Horizon drilling rig on 20 April caused the disaster.

Source : BBC News

Other News :
BP statement on two altered images - original and altered images provided
BP Sparring With Partners on Well Costs

Wednesday, 21 July 2010

China finds 'world scale' oilfield

China's biggest oil producer says it has discovered a massive new offshore oil field that could become the country's largest domestic petroleum source in a decade.

The field in the Bohai Bay, in eastern China, could hold reserves of up to 2.2 billion barrels, the official Xinhua news agency reported.
The estimated output is equivalent to 5.4 per cent of China's total crude production in 2006, the agency quoted sources with PetroChina as saying.

The find comes amid intense exploration by China's oil companies, looking to reduce the country's rapidly growing dependence on foreign oil.
Such a field, if confirmed, would be a "world-scale discovery", Gavin Thompson, an oil consultant based in Beijing, told the Associated Press.

"In terms of energy security, a 2 billion barrel discovery is going to be very welcome, not only to PetroChina but to China's energy planners."

Jiang Jiemin, vice-chairman and president of PetroChina, said it was "the largest find in China in 10 years".

The Nanpu block in Bohai Bay, partly offshore, covers an area of 1,300-1,500 sq km and is expected to produce high-value light crude, the company said.

Leading importer

CNOOC, another leading energy company, announced this week that it had also discovered new oil and gas fields in Bohai Bay, yielding a test output of 1,600 barrels of oil and approximately 10 million cubic feet of gas per day.

Zhu Weilin, vice-president of CNOOC, said of the discovery: "We hope to develop a large-scale cluster of oil and gas fields [there] in the future."

China, which once met its energy needs from domestic oilfields, has turned into a leading importer of fuel since the 1990s amid surging economic growth.

It is now the world's second largest energy consumer after the US.

The country met almost half of its energy needs through imported fuel in 2006 with oil consumption rising by 9.3 per cent to 2.4 billion barrels.

Easing the pressure

Jim Brock, an industry consultant in Beijing, said while the Bohai discovery would help lessen the pressure for more imports, there would still be "significant pressure".

China, he said, would continue to be a major player in the international market.

Economists say Chinese oil demand, driven by economic growth that reached 10.7 per cent in 2006, has strained world supplies and pushed up prices.

The government is trying to improve the energy efficiency of its economy, which consumes several times more units of energy per unit of output than Japan or the US.

Although Chinese drillers have found several big gas fields, the Bohai discovery is the first major oil find since the mid-1990s.

Source : Al-Jazeera

Related stories :
China surpasses US as world's top energy consumer
China denies energy use claims

Tuesday, 20 July 2010

Positive outlook for local oil and gas players

KUCHING: The oil & gas industry in Malaysia is seeing a positive uptick as local players continued to report positive news permeating the industry, pointing towards a better 2011 for the sector.

“We cannot deny that there has been a stream of good news for the oil and gas sector that suggests upstream activity is turning more positive,” affirmed a representative from RHB Research Capital Sdn Bhd (RHB Research) when contacted by the Borneo Post yesterday.

“However, we believe that investors should view all news flow in perspective, given there was still underlying economic issues that could pull sentiments down.

“In the near term, we are concerned that a sharper-than-expected global economic slowdown will affect demand for oil. Our conclusion is that there is no real pressure for crude oil prices to move up, and therefore no rush for oil and gas companies to begin spending aggressively. Thus, in the near future, the sector remains very much driven by trading sentiment.”

This was in light of British Petroleum (BP) successfully capping the leaking well in the Gulf of Mexico. Stopping this leak, highlighted RHB Research, was a significant leap forward and relieved the pressure on the US government to impose further drilling restrictions, which in turn reduced the risk of offshore assets moving to this region looking for jobs.

The research house continued to highlight that Southeast Asia’s offshore activities outperformed the rest of the world as shown by the increase month-on-month (m-o-m) in the number and utilisation of working rigs.

NOTEWORTHY PACT: Bourbon Offshore is one of the world’s largest offshore support vessel players, leading to conclude that the MoU will be a significant play for Petra Energy.
NOTEWORTHY PACT: Bourbon Offshore is one of the world’s largest offshore support vessel
players, leading to conclude that the MoU will be a significant play for Petra Energy.

Among good news in the sector included UMW Holdings Bhd (UMW) expecting to revisit its proposal to list its oil & gas revision next year. This could potentially spur the revival of other proposed listings in the sector that were halted, said the research house.

In addition, RHB Research backed UMW to secure contracts for its Naga 2 and Naga 3 jack-up rigs in the near term. It was highlighted that charter rates appeared to be improving but were still below the peak in 2008.

ECM Libra Capital Sdn Bhd (ECM Libra) in a separate report yesterday shared the same view with RHB Research, noting that several oil & gas companies in the region was seeing more action in terms of contracts and boardroom action.

Dayang Enterprises Sdn Bhd (Dayang Enterprises) were among the updates, receiving two work orders under a contract with Petronas Carigali Sdn Bhd (Petronas Carigali) for the provision of hook-up and commissioning (HUC) services.

The two work orders, estimated at a total value of RM48.7 million, would bring the group’s earnings before interest and tax (EBIT) margins to the 20 per cent to 25 per cent levels. The group’s strong margins came from the fact that they owned their own workboats and barges as well as equipment, which were fully paid off, hence no third party charters which would eat into margins.

At this point, ECM Libra opined that the Dayang Enterprises still had an order book of roughly RM920 million with the bulk coming from Shell’s top side maintenance services.

Other news underscored by the research firm included Petra Perdana Bhd (Petra Perdana) managing to secure one board representation in Petra Energy Bhd (Petra Energy) during the extraordinary general meeting (EGM).

Although the board was planning to secure three seats, the one representation nonetheless meant that there was less likelihood of Petra Perdana selling their stake in Petra Energy.

Speaking of Petra Energy, the group formed an alliance with the Singaporean branch of Bourbon Offshore. The latter is one of the largest offshore support vessel players in the world, leading to conclude that this memorandum of understanding (MoU) would be a significant play for Petra Energy.

Under the terms of this MoU, Petra Energy would carry out topside maintenance works while Bourbon Offshore would supply the vessels necessary for the job.

In other news, Thailand’s Mermaid Offshore continued its divestment of Malaysian businesses, looking to sell a Petronas-licensed subsea business for US$23.4 million to their local partner. ECM Libra noted this to be a likely move to raise cash for other purchases.

Looking at downstream developments, Gas Malaysia Sdn Bhd (Gas Malaysia) signed an agreement with Petroliam Nasional Bhd (Petronas) for the supply of an additional 82 million standard cubic feet per day (mmscfd) of natural gas.

Pursuant to the second supplement of gas supply agreement, this additional supply of natural gas would be effective until December 31, 2011 and would be earnings accretive.

Apart from that, there was circulating news of a private company looking to build 4,000km of subsea liquefied natural gas (LNG) pipeline from Malaysia to South Korea. This project was valued at US$50 billion or RM160 billion.

ECM Libra viewed this news to be of potential for the likes of Wah Seong Corporation Bhd (Wah Seong) and SapuraCrest Petroleum Bhd (SapuraCrest Petroleum) should it come to fruition.

To conclude, both research firms maintained a positive outlook for the sector in the long term, backing several companies such as Dialog Group Bhd, Dayang Enterprises, Wah Seong and SapuraCrest Petroleum.

Source : The Borneo Post

Monday, 19 July 2010


Sabah, One of South East Asia’s Largest Oil & Gas Producer!
Highlights Of The Sabah Oil & Gas Industry
  • The New Sabah Oil & Gas Terminal Project (SOGT) At Kimanis
  • Sabah’s Potential Of Becoming The Biggest Oil & Gas Producer In South East Asia
  • Sabah-Sarawak Gas Pipe Project (SSGP)
  • Sabah's Many Deepwater Offshore Fields Including Malaysia’s First Deepwater Field In Kikeh
ASEAN OIL & GAS EXPO (AGEX) 2010, SABAH is the industry event for oil and gas professionals in the region. This international event is projected to bring together in 2010, more than 6,000 industry professionals to address the strategic, operational and technology aspects of the Sabah oil and gas industry. The international character of AGEX 2010 presents unparalleled marketing, education and networking opportunities. AGEX 2010 offers you the ideal platform to explore new oil and gas business opportunities, expand your market presence and penetrate emerging markets in Sabah

BP, feds clash over reopening capped Gulf oil well

NEW ORLEANS – BP and the Obama administration offered significantly differing views Sunday on whether the capped Gulf of Mexico oil well will have to be reopened, a contradiction that may be an effort by the oil giant to avoid blame if crude starts spewing again.

Pilloried for nearly three months as it tried repeatedly to stop the leak, BP PLC capped the nearly mile-deep well Thursday and wants to keep it that way. The government's plan, however, is to eventually pipe oil to the surface, which would ease pressure on the fragile well but would require up to three more days of oil spilling into the Gulf.

"No one associated with this whole activity ... wants to see any more oil flow into the Gulf of Mexico," Doug Suttles, BP's chief operating officer, said Sunday. "Right now we don't have a target to return the well to flow."

An administration official familiar with the spill oversight, however, told The Associated Press that a seep and possible methane were found near the busted oil well. The official spoke on condition of anonymity Sunday because an announcement about the next steps had not been made yet.

The concern all along — since pressure readings on the cap weren't as high as expected — was a leak elsewhere in the wellbore, meaning the cap may have to be reopened to prevent the environmental disaster from becoming even worse and harder to fix.

The official, who would not clarify what is seeping near the well, also said BP is not complying with the government's demand for more monitoring.

Retired Coast Guard Adm. Thad Allen, the Obama administration's spill response chief, demanded BP provide results of further testing of the seabed by 9 p.m. EDT Sunday night.

"When seeps are detected, you are directed to marshal resources, quickly investigate, and report findings to the government in no more than four hours. I direct you to provide me a written procedure for opening the choke valve as quickly as possible without damaging the well should hydrocarbon seepage near the well head be confirmed," Allen said in a letter to BP Managing Director Bob Dudley.

When asked about the situation earlier Sunday before the letter was released, BP spokesman Mark Salt would only say that "we continue to work very closely with all government scientists on this."

Oil cleanup workers skim for oil from the Deepwater Horizon oil spill in the Perdido Pass in Orange Beach, Ala., during a heavy rain storm Sunday, Jul

Oil cleanup workers skim for oil from the Deepwater Horizon oil spill in the Perdido Pass in Orange Beach

Allen insisted Sunday that "nothing has changed" since Saturday, when he said oil would eventually be piped to surface ships. The government is overseeing BP's work to stop the leak, which ultimately is to be plugged using a relief well.

Allen decided to extend testing of the cap that had been scheduled to end Sunday, the official who spoke on condition of anonymity said. That means the oil will stay in the well for now as scientists continue run tests and monitor pressure readings. The official didn't say how long that would take.

Officials at the Department of Homeland Security referred questions to a statement issued by Allen; neither he nor BP officials could explain the apparent contradiction in plans.

Suttles' comments carved out an important piece of turf for BP: If Allen sticks with the containment plan and oil again pours forth into the Gulf, even briefly, it will be the government's doing, not BP's.

The company very much wants to avoid a repeat of the live underwater video that showed millions of gallons of oil spewing from the blown well for weeks.
"I can see why they're pushing for keeping the cap on and shut in until the relief well is in place," said Daniel Keeney, president of a Dallas-based public relations firm.

The government wants to eliminate any chance of making matters worse, while BP is loath to lose the momentum it gained the moment it finally halted the leak, Keeney said.

"They want to project being on the same team, but they have different end results that benefit each," he said.

Oil would have to be released under Allen's plan, which would ease concerns that the capped reservoir might force its way out through another route. Those concerns stem from pressure readings in the cap that have been lower than expected.

Scientists still aren't sure whether the pressure readings mean a leak elsewhere in the well bore, possibly deep down in bedrock, which could make the seabed unstable. Oil would be have to be released into the water to relieve pressure and allow crews to hook up the ships, BP and Allen have said.

So far, there have been no signs of a leak.

"We're not seeing any problems at this point with the shut-in," Suttles said at a Sunday morning briefing.

Allen said later Sunday that scientists and engineers would continue to evaluate and monitor the cap through acoustic, sonar and seismic readings.

They're looking to determine whether low pressure readings mean that more oil than expected poured into the Gulf of Mexico since the BP-leased Deepwater Horizon rig exploded April 20, killing 11 people and touching off one of America's worst environment crises.

"While we are pleased that no oil is currently being released into the Gulf of Mexico and want to take all appropriate action to keep it that way, it is important that all decisions are driven by the science," Allen said in a news release.

"Ultimately, we must ensure no irreversible damage is done which could cause uncontrolled leakage from numerous points on the sea floor."

Both Allen and BP have said they don't know how long the trial run will continue. It was set to end Sunday afternoon, but the deadline — an extension from the original Saturday cutoff — came and went with no word on what's next.

After little activity Sunday, robots near the well cap came to life around the time of the cutoff. It wasn't clear what they were doing, but bubbles started swirling around as their robotic arms poked at the mechanical cap.

To plug the busted well, BP is drilling two relief wells, one of them as a backup. The company said work on the first one was far enough along that officials expect to reach the broken well's casing, or pipes, deep underground by late this month. The subsequent job of jamming the well with mud and cement could take days or a few weeks.

It will take months, or possibly years for the Gulf to recover, though cleanup efforts continued and improvements in the water could be seen in the days since the oil stopped flowing. Somewhere between 94 million and 184 million gallons have spilled into the Gulf, according to government estimates.

The spill has prevented many commercial fishermen from their jobs, though some are at work with the cleanup. Some boat captains were surprised and angry to learn that the money they make from cleanup work will be deducted from the funds they would otherwise receive from a $20 billion compensation fund set up by BP.

The fund's administrator, Kenneth Feinberg, told The Associated Press on Sunday that if BP pays fishermen wages to help skim oil and perform other cleanup work, those wages will be subtracted from the amount they get from the fund.

Longtime charter boat captain Mike Salley said he didn't realize BP planned to deduct those earnings, and he doubted many other captains knew, either.

"I'll keep running my boat," he said Sunday on a dock in Orange Beach, Ala., before heading back into the Gulf to resupply other boats with boom to corral the oil. "What else can I do?"

Saturday, 17 July 2010

Fires rage for 15 hours after oil pipeline in China explodes

BEIJING — An oil pipeline at a busy Chinese port exploded, causing a massive fire that burned for 15 hours before being put out Saturday. Officials said no one was killed.

State-run media said the pipeline blew up Friday evening, and more than 2,000 firefighters worked overnight to control flames and further blasts on a second pipeline.

China Central Television showed the fire raging among tanks at the port in the northern city of Dalian, and state media described flames of about 100 feet (30 meters) high.

The cause of the initial blast was not clear. The Xinhua News Agency said it happened while a Liberian tanker was unloading oil at the port. It said the tanker left safely.

A vast stretch of polluted sea remains the next challenge. About 20 boats were trying to clean up a dark brown slick of oil and pollution at least 50 square kilometers (19 square miles) in size off Dalian's Xingang Harbor, Xinhua said Saturday night.

Image: Oil pipeline blast site in Dalian

The fire raged for more than 15 hours after two oil pipelines exploded in the port of Dalian in northeast China

The pipelines are owned by China National Petroleum Corp., which is Asia's biggest oil and gas producer by volume.

The state-owned company did not immediately comment. Phones at its Beijing headquarters rang unanswered, and while the company website showed updates Saturday, there was no mention of the fire.

More pictures click here

Tap Oil to Commence Belait N 3D Seismic Program

Tap Oil Limited has commenced field operations for a 3D seismic survey in Block M, onshore Brunei as part of its exploration and development program.

Work has begun on surveying and line clearing. The survey covers approximately 136 sq km and is expected to take some 5 months to complete.

Tap Oil Managing Director and Chief Executive Officer, Peter Stickland, said the 3D seismic survey will provide Tap with detailed subsurface information along the northern, less explored portion of the Belait trend.

“We have identified several interesting leads on 2D seismic data in this area and believe they warrant detailed scrutiny by 3D data to reduce risk before being considered for drilling,” Mr Stickland said.

“This seismic operation complements our 2010 Block M drilling program in the southern part of the Belait trend. The first well in this program, Mawar-1, is due to spud in the next few days. This is an exciting time for our company in Brunei,” he said.

Tap Energy (Borneo) Pty Ltd, as operator of Block M, has contracted BGP Inc. to conduct the field operations. Crew numbers are expected to increase to peak at over 1,000 people in September when the recording phase of the survey reaches full operational capacity.

The area to be covered by the Belait North 3D seismic survey lies in the north central part of Block M and covers a northern extension of the prospective trend covered by the 2009 Belait 3D seismic survey. The area is bisected by the Belait River, with jungle-covered hills to the south and more subdued terrain to the north. The aim of the survey is to identify additional drilling targets along the trend for possible drilling in 2011/2012.

Participants in Block M are:
Tap Energy (Borneo) Pty Ltd: 39%, Kulczyk Oil Ventures Inc: 36%, China Sino Oil Co. Ltd: 21% and Jana Corporation Sdn Bhd: 4%.

Block M is being explored under a Petroleum Sharing Agreement signed with Brunei National Petroleum Company (PetroleumBRUNEI) in August 2006.

Block M covers an area of approximately 3,011 km2 (see attached map) in the Baram Delta Basin and is the largest onshore permit in Brunei. The Block contains the Belait anticlinal trend along which hydrocarbon seeps occur and oil and gas have been encountered in previous drilling.

The Belait trend is characterised as having recoverable hydrocarbons in the range of eight to 64 million barrels of oil. Block M is regarded as under-explored having not seen a concerted exploration effort using modern exploration methods for over 20 years.

Tap became the Operator of the Block M Joint Venture in April 2008 and acquired both 2D and 3D seismic data in 2009. The Joint Venture is planning to drill at least two wells on the prospective Belait anticlinal trend in 2010.

Source :
Related topic : Murphy Terminates Production Sharing Contracts

Thursday, 15 July 2010

Harga petrol, diesel, gula dan gas naik

Harga petrol, diesel, gula dan Petroleum Gas Cecair (LPG) naik berkuatkuasa mulai tengah malam ini.

Petrol RON 95 dan diesel naik 5 sen. RON97 tidak lagi diberikan subsidi. Ia tertakluk kepada apungan secara terkawal, dengan harga ditentukan oleh mekanisme harga automatik, berikutan penyelarasan harga subsidi yang diumumkan kerajaan hari ini.

Tidak jelas berapa kenaikan harga RON 97. Tetapi difahamkan harganya naik 5 sen dan akan diselaraskan seterusnya kemudian.

Manakala harga gula pula naik 25 sen kepada RM1.90, dengan gas LPG naik sebanyak 10 sen sekilogram

Kenaikan harga barangan berkenaan diumumkan oleh Perdana Menteri, Datuk Seri Najib Tun Razak dalam satu pengumuman malam ini.

Menurut perdana menteri, penyelarasan semula harga barangan tersebut akan membolehkan kerajaan mengurangkan perbelanjaannya melebihi RM750 juta untuk tahun ini.

Ia merupakan langkah pertama program rasionalisasi subsidi secara berperingkat-peringkat mulai esok.

Bagaimanapun, tambanya, kerajaan masih membelanjakan kira-kira RM7.82 bilion untuk subsidi bahan api dan gula pada 2010.

Harga bahan api dan gula di Malaysia, tegas Najib, masih antara yang terendah di rantau ini.

Berikut adalah harga baru:
Petrol RON 95 - RM1.85 seliter.
Diesel - RM1.75 seliter.
Gula - RM1.90 sekilogram
Gas LPG - RM1.85 sekilogram

Berikut adalah harga baru gas:
Tong 14KG - dari RM24.50 kepada RM25.90 (naik RM1.40)
Tong 12KG - dari RM21.00 kepada RM22.20 (naik RM1.20)
Tong 10KG - dari RM17.50 kepada RM18.50 (naik RM1.00)

Sementara itu, Berita Harian online memetik Perdana Menteri,Datuk Seri Najib Tun Razak sebagai berkata, kerajaan perlu mengurangkan subsidi bagi menjimatkn perbelanjaan kerajaan dan mengurangkan defisit fiskal supaya pasaran dunia dan dalaman lebih yakin dengan kekuatan ekonomi negara.

Najib berkata demikian selepas merasmikan Mesyuarat Perwakilan Umno bahagian Kuala Kedah di Alor Star, petang ini.

Beliau yang juga menteri kewangan berkata, penjimatan perbelanjaan itu juga akan digunakan untuk pembangunan negara yang akhirnya memberi faedah kepada rakyat.
Beliau turut memberi jaminan pengurangan subsidi akan dibuat secara minimum supaya tidak membebankan rakyat.

Pada 27 Mei lalu, Menteri di Jabatan Perdana Menteri, Datuk Seri Idris Jala dilaporkan berkata, Malaysia akan muflis pada 2019 jika kerajaan tidak memotong subsidi dan bergantung kepada pinjaman.

Katanya, hutang Malaysia akan meningkat kepada 100 peratus daripada GDP pada 2019 d- daripada 54 peratus sekarang jika subsidi tidak dipotong.

Sumber : MalaysiaKini

Sunday, 11 July 2010

Petronas Kenal Pasti Sumber Tompokan Minyak

Petronas telah mengenal pasti kerosakan pada saluran paip pengeluaran yang dikendalikan oleh Newfield Peninsula Malaysia Inc, sebagai punca tompokan minyak yang dilihat berhampiran pelantar minyak di luar pantai Pantai Timur Semenanjung Malaysia.

"Penyiasatan di dasar laut awal pagi tadi mengesan satu titik kerosakan pada saluran paip pengeluaran yang dikendalikan oleh Newfield Peninsula Malaysia Inc," katanya dalam satu kenyataan.

"Hasil siasatan visual awal menunjukkan saluran paip itu rosak akibat kegiatan sebuah kapal marin yang tidak dikenal pasti, dan tidak mempunyai kaitan dengan operasi Newfield.

"Kerja-kerja baik pulih di saluran paip yang terjejas itu sedang dijalankan," katanya.

Petronas mengambil langkah-langkah kecemasan dengan menutup saluran paip pengeluaran di pelantar yang terletak 240 km dari pantai itu, selepas satu lapisan tipis kesan minyak dilihat.

Dalam kenyataan hari ini, Petronas juga berkata saluran paip pengeluaran Petronas Carigali dan ExxonMobil Exploration and Production Inc, yang telah ditutup sebagai langkah berjaga-jaga itu menyambung operasi masing-masing sejak awal hari Sabtu.

Ia juga berkata pasukan kecemasan dan respons tumpahan bersama sedang membersihkan saki baki tompokan minyak itu manakala pengawasan akan diteruskan bagi memantau situasi tersebut.

PETRONAS berkata ia akan memberikan maklumat terkini jika dan bila ada perkembangan baharu.

Sumber : Bernama