INTERNATIONAL BRIEF REVIEWS
Ramco seeks more work in ex-Soviet Union
CHICAGO, Nov 11 - Independent oil company Ramco Energy Plc, the Aberdeen, Scotland-based partner in the massive Azerbaijan International Operating Consortium (AIOC), is looking to develop more projects in the former Soviet Union, Chairman and Chief Executive Steve Remp said on Wednesday.
"I would very much like to see us in Kazakhstan and we are endeavoring to acquire some offshore acreage in Kazakhstan as we speak," he told Reuters in an interview.
"And we're also looking at a gas project with a major western partner in Uzbekistan. For that to succeed would require a partnership with Gazprom <GAZPq.L> in order to move Uzbek gas into Russia," he added.
The 12-company AIOC consortium operates the Azeri, Chirag, Gunashli (ACG) field in the Caspian Sea off the coast of Azerbaijan, which is estimated to have a minimum of five billion barrels of recoverable reserves.
Ramco Energy has a 2.0825 percent stake in the AIOC.
British Petroleum Co. Plc <BP.L>, which currently has a 17.13 percent stake in the AIOC, will emerge as by far the largest partner after its merger with Amoco Corp. <AN.N>, which will raise its share to 34.14 percent in the consortium.
Remp noted that by the end of the year, the ACG field would be producing 100,000 barrels per day, far exceeding earlier forecasts.
"The five wells are all producing at twice the original forecast rate of 10,000 barrels per day," he said. "The performance of the reservoir has exceeded best expectations."
Industry sources estimate production for the ACG field should peak in 2006 at around 870,000 barrels per day.
Ramco also has an interest in further development of the adjacent shallow-water Gunashli field, a project in which Conoco Inc. <COC.N> has become the major partner. Conoco is still majority owned by DuPont Co.<DD.N>
The shallow-water Gunashli field is estimated to have a minimum of 750 million barrels of recoverable reserves.
Conoco has been negotiating with SOCAR, the state oil company of Azerbaijan, about further development of the Gunashli field, where production has declined to about 100,000 barrels a day from a peak of 140,000 barrels.
The cost of recovering the Gunashli field's oil has been estimated at about $1.5 billion. Ramco Energy's interest in the project has been estimated by sources in Baku at 15 percent to 20 percent.
"By our standards, that would be a very big project," Remp said.
Earlier this year, Ramco also struck a deal with Montenegro for the rights to half the country's offshore acreage.
Remp said he was looking for one or more major partners to join Ramco with drilling to begin in the year 2000.
"Probably the most exciting thing that we're doing is Montenegro," Remp said, referring to the republic within the Federal Republic of Yugoslavia. "Clearly, this is just a project at the moment, and we need to find there is big oil."
Qatar's gas sector faces tough times ahead
DOHA, Nov 12 6:30AM - (AFP) - Qatar's gas industry faces tough times ahead but is in a better position than most to emerge unbowed from the economic turmoil that has strained the sector, industry sources said.
Qatar, a country of just 522,000 people, four-fifths of whom are expatriates, is sitting on top of the world's third largest gas reserves, but its geographical fortune has produced little wealth so far.
The prospects of a turnaround in the near-term look grim as its main market, Asia, continues to writhe in economic agony and some of its established markets, like South Korea, look distinctly wobbly.
But industry sources this week said that while the gas wealth will be delayed, its eventual arrival, in as little as four years, is secure.
"The projects will come on-line more slowly than planned, but they are already mostly financed and, unlike some other gas producers, it is a question of when those projects are completed rather than if," one industry insider said.
Despite predictions to the contrary, Qatar has not cancelled any of its gas projects, although many have been slowed down in the face of stagnant or retreating markets in Asia.
This may have dampened expectations, but Qatar's situation looks distinctly rosier than other producers who left their financing until after the global economic crisis began.
"Today, I don't see any grassroot projects surviving, because of the cost," the Gulf emirate's Energy and Industry Minister Abdulla ibn Hamad al-Attiyah told AFP in an interview earlier this week.
But even once Qatar's gas projects are completed, there still remains the problem of finding buyers.
The emirate is already struggling to off-load its current production of liquefied natural gas (LNG) and despite large contracts with Japan, Korea and India there is still substantial excess production.
It also has the disadvantage that its long-term deals with Japan's Chubu Electric Power Co., seven smaller deals with Japanese power and gas firms, Korea Gas Corp. and India's Petronet will take some time to kick in.
The Chubu contract, for instance, includes a phase-in over three years from 1997 until 1999. The other deals will not reach their full contractual amount until, in some cases, 2002.
On paper this should give Qatar's two gas companies, Qatargas and Rasgas, combined sales of more than 18 million tonnes a year by 2002, but some doubt remains as to whether all the contracts will survive at their present scale.
Diplomats in Doha familiar with the country's gas sector said that Rasgas may be preparing to divert production to the new 20-year Petronet if the Korean contract is cut back or cancelled.
Because of Asia's economic troubles, gas producers, including Qatar, will face shorter contracts, lower prices and less creditworthy clients in the medium-term, according to industry analysts.
Qatar's gas firms have tried to fill in these demand gaps through new practices like spot sales, but the success of these schemes has been limited.
Qatargas this year secured its first spot sale with Duke Energy of the United States, but it was only for 51,000 tonnes of LNG in December.
Meanwhile, gas producers are hoping that these sorts of measures will only be a stop-gap until new long-term demand emerges from an Asian recovery in the next decade.
"A period of slowed economic growth for Asia will delay, but not reverse, the region's trend of increased gas use, particularly in the form of LNG," Naji Abi-Aad, a senior advisor at the Observatoire Mediterraneen de L'Energie said at a gas summit in Abu Dhabi last month.
Today in the energy markets - Nov 12th
DIARY OF ENERGY MARKET EVENTS THURSDAY, NOVEMBER 12
ROME - Second Annual Global Gas, business opportunities and gas strategies upstream and downstream conference organised by Global Pacific and Partners at Rome Cavalieri Hilton Hotel. For information see www.glopac.com (To November 13).
NEWBURY RACECOURSE, England - British BioGen industry group holds annual conference. Speakers from across the industry and government will present a new vision for large-scale deployment of bioenergy in the first decade of the next millennium.
LONDON - Gas-to-Liquids world forum conference and exhibition to be held at the Renaissance London Heathrow Hotel by IBC conferences.
LONDON - International Conference on the Future of Transportation Fuel Quality in Europe conference organised by the Institute of Petroleum to be held at the Rutherford Conference Centre.
CHENNAI, India - Energy Summit (Second day).
BUENOS AIRES - International conference on climate change (Eleventh day).
BUENOS AIRES - "Expominar" international mining industry seminar (Final day).
LYON, France - UNCTAD Partners for Development Summit (Final day).
MELBOURNE - VicGas 98 Summit (Final day).
TOKYO - International oil symposium on the challenges facing the petroleum industry, hosted by the Japan Cooperation Center for Petroleum (Final day).
|
