Europe

Forties on the rocks: how granite led to UK oil pipeline outage

The unplanned shutdown in December of Britain’s biggest oil pipeline, Forties, which shut off supplies for more than two weeks and fired up global oil prices, had an unlikely cause: Scottish granite, its owner Ineos said. Ineos bought the pipeline from oil major BP last October for $250 million. In early December, its contractors spotted a crack on an onshore section of the pipeline during what Ineos called a routine inspection. “The precise point of the transverse weld of the pipeline was resting on a sharp ridge of granite rock and over time vibration of the pipeline led to the hairline crack,” Tom Crotty, director at Ineos, told Reuters. “It was a failure that BP hadn’t seen before and we don’t expect to see again,” he said, after the pipeline resumed full operation in late December following the Dec. 11 shutdown. One of the oldest pipelines […]

Don’t worry about oil price movement yet, Russia says

20 Jan 2018   OPEC, Prices, Russia

It’s too early in 2018 to discuss stabilization for oil prices, which are down 2 percent from their peak, but up 3.5 percent so far, a Russian official said. Crude oil prices started the year on a historic rally, moving from $66.65 per barrel for Brent, the global benchmark, to its highest close in four years, just above $70 per barrel, in a span of about a week and a half. As of early Friday, Brent was trading closer to $69 per barrel. Brent futures ended 2017 up almost 22 percent. Arkady Dvorkovich, Russia’s deputy prime minister, said it was too early in the year to […]

$70 Oil Cripples European Refiners

19 Jan 2018   Europe, Prices

In the latest indication of the strength of the recovery of global oil prices, European refineries are struggling to pay their crude bills as margins decline and demand weakens for some of their products, Bloomberg reports . The profit curve for fuel oil, used by shippers and power stations, has fallen the most dramatically. High inflows of diesel in the Middle East are making that fuel difficult to bank on as well. As a result of the capital crunch, refinery runs could become shorter, KBC Advanced Technologies, a research firm in the sector, says, though part of these fluctuations are owed to normal seasonal tendencies. “Oil demand usually slackens in the first quarter and into the second quarter, so sooner or later refinery intakes will have to slacken and the usual signal for that is lower margins,” KBC chief economist Stephen George said. The timing of the revised production […]

German offshore wind farm closer to powering mainland

18 Jan 2018   Germany, Wind

Construction of a wind farm in the German waters of the Baltic Sea, set to supply power for 400,000 homes, is ahead of schedule, the head company said. German utility E.ON said Wednesday that construction of its Arkona wind farm is moving into its second phase a bit early, with the 60 foundations already set in place for their Siemens turbines. The 60-turbine wind farm is set about 22 miles off the coast of Germany. Construction of the actual turbines is under way and the offshore infrastructure is set for cabling and connection to the substation. The company deployed the 60 so-called monopiles in September. Foundations for a common substation were installed the month prior and the entire project could start […]

Russian effort to comply with OPEC balancing effort based on market, not price

17 Jan 2018   OPEC, Russia

The situation on the market, not the price of oil, determines Russia’s appetite for complying with the OPEC balancing act, the country’s energy minister said. Russia is among the handful of producers party to the Organization of Petroleum Exporting Countries playing a role in the multilateral effort to balance an oversupplied market for crude oil with coordinated cuts in output. Russia is also the largest non-OPEC contributor and a member of a joint committee monitoring compliance. Geopolitical risk, global energy demand forecasts and the late 2017 decision by OPEC to extend the deal for another year helped push crude oil prices to four-year highs. That’s led to some concern that parties […]

Norway Grants Record 75 New Offshore Exploration Leases

17 Jan 2018   Norway

“The number of licenses is the highest ever awarded in a licensing round on the Norwegian continental shelf. Access to new, prospective exploration acreage is a central pillar in the government’s petroleum policy,” Energy Minister Terje Soeviknes said in a statement. Forty-five were in the North Sea, 22 in the Norwegian Sea, and eight others in the Barents Sea. Thirty-four firms were awarded leases and 19 of them earned the rights to lead their corresponding projects. Statoil, which is based in Norway, won 31 leases, while BP’s subsidiary scored 23. Thanks to costs cuts and large oil discoveries made before the oil price crash, Norway will be able to sustain its oil and gas production over the next five years. But reduced exploration drilling and lack of big discoveries in the past two years spell trouble for Western Europe’s biggest oil and gas producer after 2023, authorities […]

Russia will not support U.S. bid to change Iran nuclear deal: Lavrov

16 Jan 2018   Iran, Russia, USA

Russian Foreign Minister Sergei Lavrov said on Monday Moscow will not support attempts by Washington to modify the Iran nuclear deal. Lavrov spoke days after U.S. President Donald Trump said he would waive nuclear sanctions against Iran for the last time to give Washington and its European allies a chance to fix the “terrible flaws” of the 2015 nuclear deal. “We will not support what the United States is trying to do, changing the wording of the agreement, incorporating things that will be absolutely unacceptable for Iran,” Lavrov told a news conference in Moscow. Russia’s top diplomat, who stressed that Russia will work to preserve the existing Iran nuclear deal, also warned that the agreement’s collapse could be detrimental to dialogue with North Korea. “If the deal is put aside and Iran is told, ‘you keep up with your obligations or we will impose sanctions again’, […]

Total plants flag offshore Brazil

16 Jan 2018   Brazil, France

French energy company Total said it’s now a premier player in the oil basins off the coast of Brazil after finalizing a partnership with a state energy company. Total and state-controlled Petróleo Brasileiro, known commonly as Petrobras, announced Monday they finalized a $1.95 billion strategic partnership that gives the French company at least 20 percent of the rights to licenses in the lucrative Santos oil basin off of Brazil’s coast. Using floating production vessels, Total said it’s gained a stake in four fields that could combine for 250,000 barrels of oil production per day. About 100,000 bpd is already in production and the rest is expected to come on line gradually through 2019. Much of the oil from the offshore basins is […]

Shell OKs first UK North Sea project in six years

16 Jan 2018   North Sea

Royal Dutch Shell gave the green light on Monday for an expansion of the Penguins oil and gas field in the UK North Sea, its first major new project in the ageing basin in six years. Shell said the development, which includes the construction of a floating production, storage and offloading (FPSO) vessel, reaffirmed the Anglo-Dutch company’s commitment to the region after it sold around half of its assets there last year. “Penguins demonstrates the importance of Shell’s North Sea assets to the company’s upstream portfolio,” said Andy Brown, director of Shell’s oil and gas production, known as upstream. The FPSO is expected to produce up to 45,000 barrels of oil equivalent per day (boe/d). Shell shares were 0.3 percent lower at 1145 GMT. The Penguins redevelopment is the first major project Shell has announced since 2012, when it made a final investment decision for the […]

North Sea industries could adapt and thrive during oil field maturation

16 Jan 2018   North Sea

Tearing down the infrastructure from aging North Sea oil and gas fields could generate a stream of revenue for the industry as a whole, a consultant group said. Royal Dutch Shell started the process of taking down legacy operations at the Bravo production platform in the North Sea last year. The Bravo platform supported Brent oil field development, but was closed down in 2014. Field maturation has forced the idling of several production platforms and Shell is in the midst of a multi-million-dollar plan to take them down. The British government estimated it could cost about $77.3 billion to decommission offshore infrastructure. Energy consultancy Westwood Group said up to $100 billion in spending on […]

Norway’s $1.1 Trillion Wealth Fund Looks For Riskier Investments

16 Jan 2018   Norway

Just over a year ago we noted that, after being forced to withdraw at least $15 billion to fund 2017 budget deficits, the $860 billion Norwegian sovereign wealth fund announced that it was going all in on the global equity bubble to try to make up the difference. The change resulted in 75 percent of the fund’s capital being allocated to global equities, up from the then current 60 percent. The central bank’s board, which oversees the fund, on Thursday recommended an increase in the equity share to 75 percent from 60 percent. That will raise the expected average annual real return to 2.5 percent over 10 years and to 3.5 percent over 30 years, compared with 2.1 percent and 2.6 percent, respectively, under the current setup. The world’s largest sovereign wealth fund said that it expects an annual return of only 0.25 percent on bonds over the next […]

UK power system prices go negative Sunday as wind booms, demand weakens

16 Jan 2018   United Kingdom, Wind

Higher wind generation and lower demand drove UK power system prices into negative territory over the weekend, according to traders and National Grid data. The daily minimum system sell price was minus GBP68.43/MWh at 07:30am London time Sunday, according to National Grid. Minimum SSP prices were negative in four consecutive settlement periods Sunday morning, it said. The SSP and system buy prices are calculated and published on National Grid’s website. These imbalance prices are used for the settlement of energy imbalances incurred by participants due to differences between volumes of energy a participant contracts for, and volumes actually generated or consumed. “Short answer for the negative system prices on Sunday was the wind as [National] Grid has to pay wind [farms] to turn off,” a trader said. The trader cited strong wind as well as imports from the Continent as factors driving the negative prices, adding that demand was […]

Romania Poised To Ramp Up Gas Output

15 Jan 2018   Romania

Meanwhile, Romania, long in the shadow of European majors despite being the EU’s third-largest gas producer, is poised to step up the game and ramp up its gas output as soon as possible. While traditionally Romania has been an onshore-producing country, its Black Sea deepwater fields bid fair to finally propel the country into the club of gas exporters. This will entail overcoming numerous challenges, be it lack of infrastructure or malign government interference—how Bucharest will resolve these will predetermined its success. Romania prides itself in having an oil and gas history that goes back more than 150 years. Romania joins other nations in claiming it had built the first oil refinery ever. It also claims that Bucharest was the first city to be illuminated with kerosene lamps. By the beginning of the 20 th century, Romania was globally among the leading oil producers—the history of WWII speaks volumes […]

Russia To Discuss Possible Exit From OPEC Deal

13 Jan 2018   OPEC, Russia

Alexander Novak . Reuters reports that Novak might discuss the country’s potential exit from the pact in Oman next week. Russia had vowed to cut output by 300,000 barrels per day under the agreement as part of a group of non-OPEC producers who elected to coordinate the bloc’s market stabilization initiative. “We see that the market is becoming balanced. We see that the market surplus is decreasing, but the market is not completely balanced yet and, of course, we need to continue monitoring the situation,” Novak said. Russian oil majors have been complaining about the deal and how it is creating stumbling blocks on the road towards the industry’s expansion plans. Brent barrel prices are currently approaching $70 a barrel, suggesting crude markets are rebalancing as we approach June, when the deal is set for “review” – a process with little description in the full text of the OPEC […]

China may invest in Russian oil pipeline company Transneft

13 Jan 2018   China, Russia

China could become one of the major shareholders in Transneft, the state-backed oil pipeline company in Russia, one of its directors said Friday. Transneft First Vice President Maxim Grishanin said the Russian Direct Investment Fund was in talks to attract investors to the pipeline company. “There are investors from Japan, we are waiting for Singapore and China,” he was quoted as saying by Russian news agency Tass. “RDIF is holding talks with the Chinese.” Russia has focused investment efforts toward the Asia-Pacific, which offers a buffer against a European Union frustrated with the former Soviet Union’s influence in the regional energy sector. The 2010 launch of the East Siberia-Pacific Ocean oil pipeline in 2010 was described by Russian President Vladimir Putin as a […]

Hope Wanes for ‘Elephant’ Oil Discoveries in Norway’s Arctic

13 Jan 2018   Norway

After a disappointing year for drillers, Norwegian authorities are reviewing their hopes. (Bloomberg) — After a disappointing year for drillers, Norwegian authorities are reviewing their hopes for the Nordic country’s hottest exploration area. “In the part of the Barents Sea that’s currently open, you’ve sort of tried the elephants — the big opportunities,” Bente Nyland, the head of the Norwegian Petroleum Directorate, said in an interview. “You’re now down to the next generation in size.” That means the industry regulator would be happy with any discovery of about 500 million barrels of oil, she said. That’s a far cry from the multibillion barrel deposits discovered in the North Sea, which have helped Norway become one of the world’s richest countries over the past decades. Apart from Statoil ASA’s Snohvit gas field, no single discovery in the Barents has reached half a billion barrels. A record drilling campaign in the […]

The Most Remarkable Natural Gas Deal Of 2018

13 Jan 2018   Russia, USA

The potential first delivery of Russian LNG to U.S. shores is ruffling some feathers, due to sanctions in place on Novatek, one of the partners in the Yamal LNG terminal – the apparent origin of the LNG heading to the Everett LNG terminal in Boston. While sanctions may still be in place with certain Russian entities, the U.S. is a regular recipient of Russian oil and products. The Yamal LNG terminal in Northern Russia is one of the biggest LNG projects in the world. Once running at full tilt, it will supply 16.5 million tons of LNG to the global market annually – heading predominantly to Asian and European markets. The below graphic from S&P Global, pilfered from Twitter , highlights the most common trade routes expected for the Yamal LNG. (Is quite the journey to Asia in the winter, 72 days…). (Click to enlarge) In terms of total […]

North Sea oil production could be higher this year

12 Jan 2018   North Sea

Total British offshore oil and gas production was up from 2016 and even more, is expected as the Catcher field in the North Sea ramps up, Premiere Oil said. Premiere Oil said Thursday its total British production last year of nearly 40,000 barrels of oil equivalent per day was up 20 percent from 2016. Full year total production of 75,000 barrels of oil equivalent was in line with guidance, and up from the previous year by 5 percent. The company in late December started producing oil from the three fields — Burgman, Catcher and Varadero — that make up the Catcher complex in the North Sea. Initial production from its floating production, storage and offloading vessel parked over the area was around […]

PetroChina’s Biggest Refinery Doubles Russian Pipeline Oil Intake

11 Jan 2018   China, Oil Supply, Russia

Since the new Russia-China oil supply agreement took effect at the start of the year, PetroChina’s largest refinery has almost doubled the amount of Russian pipeline crude oil that it is processing, a senior industry source with direct knowledge of the volumes told Reuters on Wednesday. According to the source, the 410,000-bpd PetroChina refinery in the northeast port city Dalian will process 260,000 bpd of Russian pipeline crude oil in 2018, up by 85-90 percent compared to 2017. The higher volumes of Russian pipeline crude will replace seaborne Russian shipments of the ESPO blend from the Kozmino port in the Russian Far East and crude oil shipments from the Middle East, the industry source told Reuters. “The plant will be processing pipeline crude only this year,” the source noted, and added that the PetroChina-run Daqing oil field also ships pipeline crude to the Dalian refinery. An extension of the […]

Scottish oil and gas prohibition questioned

11 Jan 2018   Scotland

The shale division of British business group INEOS said it was petitioning for a judicial review of a Scottish decision to sideline onshore oil and gas work. Scotland has one of the more robust low-carbon programs in the world and its government in 2015 ruled that natural gas derived from underground coal deposits would have no place in a greening economy. The decision followed a report from the University of Glasgow that found the coal gasification industry had a history of incidents related to pollution and is out of step with Scotland’s efforts to lower its emissions without an offset like carbon capture and storage in place. INEOS Shale filed for a judicial review of […]

Aberdeen to Lose 5,500 More Energy Jobs, Council Document Highlights

11 Jan 2018   Scotland

An Aberdeen City Council document highlights that 5,500 further jobs are expected to be lost in the city’s energy sector by 2027. An Aberdeen City Council document has highlighted that 5,500 further jobs are expected to be lost in the city’s energy sector by 2027. Referencing forecasts initially outlined by Skills Development Scotland in December last year, the document states that these jobs losses will be offset by strong growth in the ICT/digital, creative and business and financial services sectors. The news follows an announcement last month from an Aberdeenshire Council representative that a new scheme launched by the Oil & Gas Technology Center was ‘very likely’ to create new oil industry jobs in Aberdeen, North East Scotland and other UK regions over the next decade. The scheme, labelled TechX, is described as a technology accelerator for the oil and gas industry. It was officially launched on Dec. 7 […]

Russia, China And Iran Lose Interest In Venezuela

9 Jan 2018   China, Russia, Venezuela

Since the election of Hugo Chávez Frias to the Venezuelan presidency in 1998, followed by Nicolás Maduro in 2013, Venezuela has endured steady decline with the approval of the new constitution in 1999, concentration of presidential power, the capture of state and private institutions, gradual control over the press, mismanagement of its national oil company and establishment of a failed political project known as the “socialism of the 21 st century.” With 81.8 percent of Venezuelan households in poverty, 1.5 million of its citizens leaving the country, 78 percent of medical centers suffering from a supply of medications, an inflation rate that may pass 2,300 percent in 2018, oil revenues cut by half and shortages of gasoline , Chávez and Maduro literally ruined the country. These economic challenges have influenced foreign relations. Alliances sought to counter the United States are starting to backfire. The official line is that the […]

Norway’s oil industry to boost staffing in coming years: energy minister

9 Jan 2018   Norway

OSLO (Reuters) – Norwegian oil companies and their suppliers will hire more people in the coming years as the industry recovers from a slump and the price of crude rises, Norway’s Minister of Petroleum and Energy Terje Soeviknes told Reuters on Tuesday. “All evidence points to a significant increase in employment in the oil industry,” Soeviknes said on the sidelines of a conference. In late 2017, oil firms presented new field development plans that will trigger billions of dollars of investment, and more plans are on the way in 2018. He still cautioned however that significant automation and productivity enhancements could limit the jobs growth. “It’s hard to imagine that all the 50,000 jobs that disappeared during the industry’s downturn will be brought back,” Soeviknes said.

Europe Becomes Victim of Russia’s Newest Oil Strategy

8 Jan 2018   Europe

Higher shipments of Russian crude oil to China may saddle European importers with a fatter bill, an industry consultancy warned at the end of last year, noting the latest stage of Russia’s Eastern pivot: the launch of the expanded East Siberia-Pacific Ocean pipeline that would lift Urals crude supply to China twofold, to 30 million tons annually. FGE said in a note quoted by Bloomberg that Russia will start moving more Urals eastward right after the launch of the pipeline extension, at a rate of 160,000 bpd. The overall increase of Russian crude shipments to China, according to the consultancy, could be around 200,000 bpd. This means less oil for Europe, which is Russia’s number-one oil client. This only highlights the significance of Moscow’s Asian pivot amid lingering European sanctions following the 2014 annexation of Crimea and Russia’s involvement in separatist conflicts in the Ukraine. In 2016, Russia exported […]

North Sea decommissioning sparks paperwork questions

5 Jan 2018   North Sea

With decommissioning of some of the aging infrastructure in the North Sea underway, a trade group is making plans for what to do with all the paperwork. “Over the 40-plus year lifespan of an offshore asset, many thousands of boxes of physical records, and millions of electronic files are created,” Daniel Brown, the manager for Common Data Access, a subsidiary of trade group Oil & Gas U.K., said in a statement. “Once the asset is removed to be dismantled, many of the records associated with it are no longer required — but deciding what must be retained, and what may lawfully be destroyed, is not a simple task.” The government estimated it […]

Russia’s gas exports to Europe rise to record high

Russia’s gas exports to Europe rose 8.1 per cent last year to a record level of 193.9bn cubic metres (bcm), despite rising competition and concerns about the country’s dominance of supply. State-run Gazprom, the world’s largest gas producer, has a monopoly over Russia’s network of pipelines to Europe and supplies close to 40 per cent of Europe’s gas. But it has been forced to lower its prices in recent years to protect its market share in the face of moves by EU member states to buy more gas from the US, Qatar and other producers.

Poland, Lithuania and other states have built terminals to receive shipments of liquid natural gas with an eye to rising exports of the super-cooled fuel from the US and elsewhere. Some eastern EU states have also tried to block new Gazprom supply projects, such as the proposed Nord Stream 2 pipeline that would double supplies to Germany. They argue that Europe should reduce its reliance on Russian energy to weaken the Kremlin and as punishment for Moscow’s 2014 annexation of Crimea.

But despite the challenges, Gazprom reported record exports to Europe for the second year in a row, with consumers turning to Russian gas to offset falling domestic production in the Netherlands and elsewhere. “The second consecutive year of record exports on the one hand demonstrates the rapidly growing demand for Russian gas in European countries, and on the other hand, its reliability to supply the required volumes,” said Gazprom chairman Alexei Miller.

Can Norway Survive Without Big Oil?

4 Jan 2018   Norway

Supermajors are shunning Arctic oil exploration in Norway, or at least that’s the overwhelming feeling after the last licensing round conducted by the Norwegian Petroleum Directorate in early December. Eleven companies applied for 102 blocks or parts of blocks, of which almost all were in the Barents Sea. The only supermajor in the crowd was Shell. What happened? More than half of Norway’s untapped oil and gas reserves are located in the Barents Sea. That’s beyond the Arctic Circle—an area that contains an estimated 90 billion barrels of crude and 1,669 trillion cu ft of natural gas in total. Norway’s share is more than 9 billion barrels of undiscovered oil. This likely would have sounded irresistible five years ago, with Big Oil always on the hunt for large-scale projects, armed with the means to afford investing in them. No more. Now everyone—up to and including the likes of Exxon, […]

Why Germans Are Being Paid To Use Power

4 Jan 2018   Germany

Dr. Kent Moors is an internationally recognized expert in oil and natural gas policy, risk management, emerging market economic development, and market risk assessment. His… That means consumers are being paid to use the power, rather than the other way around. This isn’t even the first time this has happened. According to one of Europe’s largest electricity trading exchanges (the EPEX Spot), it has happened more than 100 times in 2017. All of this would seem to bode well for German households, long regarded as operating under the highest energy prices on the continent. Well, not quite. But someone else is getting paid. And the whole matter has crucial implications for where the energy industry is going next… Given the heavy amount of taxes and fees charged for power, the wholesale cost factors in only about 20 percent of the real price charged to the average residence. That means […]

Gazprom Gas Exports Rise To Record High In 2017

4 Jan 2018   Russia

Russia’s Gazprom raised its exports by 8.1 percent annually to a record high of 193.9 billion cubic meters in 2017, the chairman of Gazprom’s management committee, Alexey Miller, said on Wednesday. In a speech at the end of December 2017, Miller said that “Last year, we set an absolute record for gas exports with 179.3 billion cubic meters. We will beat that amount by the year’s end, with over 190 billion cubic meters of gas delivered to consumers. I would like to note that this year will see several countries at once set new records for Russian gas imports. I am speaking first and foremost about our largest consumers, Germany and Turkey.” Speaking to reporters on Wednesday, Miller said that Gazprom’s production jumped by 12.4 percent on the year in 2017, to 471 billion cubic meters—the highest growth for the company on record. According to Miller, the second consecutive […]

Ricardo supporting Active Response trial to unlock grid capacity for electric vehicles

Ricardo is supporting a trial run by UK Power Networks into using smart grid technology to unlock spare capacity for increased electric vehicle use—maximizing the power available from existing infrastructure while avoiding costly network reinforcement or substation replacement. The project, called Active Response , will trial a responsive, automated electricity network that reconfigures itself, moving spare capacity to where the demand is. It will do this by using power electronics and automated switching to move electricity from heavily loaded substations to nearby substations with spare capacity. By 2030 it is anticipated that there will be up to 1.9 million electric vehicles in use across London, the East and South […]

Russian daily oil output edges up in 2017 to 30-year high

3 Jan 2018   Oil Supply, Russia

Russian oil production has continued to grow in 2017, with average daily output at a 30-year high of 10.98 million barrels per day, though the pace of growth slowed from 2016 because of the country’s participation in an OPEC-led global supply pact. The Middle East-dominated Organization of the Petroleum Exporting Countries and other leading oil producers agreed to cut their combined oil production by almost 1.8 million barrels per day (bpd) from the start of 2017 to prop up prices. Russia said it would cut its output by 300,000 bpd from the 30-year monthly high of 11.247 million bpd hit in October 2016 and achieved the targeted cut by the second quarter. OPEC and Russia have subsequently agreed to extend the cuts for the whole of 2018. Russian energy ministry data showed that oil and gas condensate production stood at 10.95 million bpd in December, up […]

Shell’s departure from Denmark’s refining business canceled

3 Jan 2018   Denmark

A $30 billion divestment program will be completed this year even after an agreement to sell a Danish subsidiary dissolved, Royal Dutch Shell said Tuesday. Shell said an agreement signed in late 2016 with refiner Dansk Olieselskab terminated without the sale completing and operations would continue as usual under the Dutch supermajor’s banner. “Shell Group’s $30 billion divestment program remains on track to complete in 2018, with deals worth $23 billion completed, $2 billion announced and $5 billion in advanced progress,” the company said in a statement. When it announced the agreement in September 2016, Shell said it would take in about $80 million in capital by leaving the Danish refinery sector behind. The agreement included the Fredericia refinery […]

Forties Pipeline System Now Fully Operational

The Forties Pipeline System is now fully operational following repair work on the asset, Ineos has confirmed. All restrictions on the flow of oil and gas from platforms feeding into the pipeline system have been lifted and virtually all platforms are now online, Ineos said in a company statement. The Ineos processing facility at Kinneil has also restarted. “Ineos has completed work on the pipeline as quickly as possible with safety as its highest priority,” Ineos stated on its website. “We apologize to our customers and the local community for the issues that the pipeline closure has created,” Ineos added. A controlled shutdown of the FPS was implemented on December 11 after a hairline crack was found in the system at Red Moss, south of Aberdeen. Late last month, Ineos predicted that repair work on the pipeline would complete around Christmas . Ineos completed its acquisition of the Forties […]

Storm Eleanor: Travel disruption and homes without power

Enable it in your browser or download Flash Player here .Sorry, you need Flash to play this. Fire crews were called to fix scaffolding outside a building near Oxford Circus in central London Media captionFire crews were called to fix scaffolding outside a building near Oxford Circus in central London Thousands of homes are without power and travel has been disrupted after Storm Eleanor swept across the UK. The Met Office recorded gusts reaching 100mph (161km/h) overnight with a yellow warning still in place for Wales, England, most of Northern Ireland and parts of southern Scotland. A man was injured after a tree fell on a car in the Vale of Glamorgan, Wales. There are numerous delays on public transport, but forecasters expect the winds to ease as the day progresses. About 3,000 homes across Northern Ireland are without power , although electricity has been restored to 20,000 properties, […]

Russia’s Grip On European Gas Markets Is Tightening

2 Jan 2018   Russia

Gazprom shipped 190 billion cubic meters of natural gas to Europe in 2017—a record high, according to Bloomberg . In 2018, that figure is expected to dip slightly to 180 billion cubic meters, which will still be the second most on record. The higher reliance on Russian gas may come as a surprise, not least because of the ongoing tension between Russia and some European countries on a variety of issues. Russia’s intervention in Ukraine and its annexation of Crimea in 2014 led to a standoff between Russia and the West—but Europe’s imports of Russian gas are up more than 25 percent since then, despite a lot of rhetoric in Brussels about diversification. There has been some progress. U.S. LNG has begun arriving on European shores for the first time, promising to compete with Russian gas. Importing LNG has been a lifeline particularly in some areas that are acutely […]

Russia Tightens Oil Grip With China’s Second Pipeline

New project to China’s Daqing city runs smoothly, Xinhua says Two parallel lines can transmit 30 million tons of oil a year A second Sino-Russian oil pipeline began operations on New Year’s Day, doubling China’s capacity to import crude from the East Siberia-Pacific Ocean system. China can now import 30 million tons annually (about 600,000 barrels a day) of Russian ESPO crude via pipeline, up from 15 million tons before the second branch opened, the official Xinhua News Agency reported Monday. The two lines run parallel to each other between Mohe at the border and Daqing in northeast Heilongjiang Province, the state media organization said. Russia pipped Saudi Arabia most of last year as the top crude supplier to China, the world’s biggest buyer. The ESPO system, a key piece of Russia’s efforts to export more energy to Asia, pumps crude directly to China via the two links and […]

UK Smashes 13 Clean Energy Records In 2017

It was a record year for powering the country using renewables in the UK, National Grid has revealed, making 2017 the “greenest year ever”. The year saw 13 clean energy records smashed in total – including the first day when wind, nuclear and solar generated more power than gas and coal. And in April, the country had its first day without coal generated energy since the industrial revolution. “2017 has been an amazing year for renewable electricity in Britain; we have never been cleaner or greener – and we are on course for an even better year in 2018,” said Gareth Redmond-King, head of energy and climate change from the WWF which gathered the figures with National Grid. “Climate change is wreaking havoc on our nature and wildlife, but we are at last facing up to the challenge, turning our backs on polluting fossil fuels and embracing a new […]

Exclusive: Russian tankers fueled North Korea via transfers at sea

30 Dec 2017   North Korea, Russia

Russian tankers have supplied fuel to North Korea on at least three occasions in recent months by transferring cargoes at sea, according to two senior Western European security sources, providing an economic lifeline to the secretive Communist state. The sales of oil or oil products from Russia, the world’s second biggest osecond-biggestd a veto-wielding member of the United Nations Security Council, breach U.N. sanctions, the security sources said. The transfers in October and November indicate that smuggling from Russia to North Korea has evolved to loading cargoes at sea since Reuters reported in September that North Korean ships were sailing directly from Russia to their homeland. “Russian vessels have made ship-to-ship transfers of petrochemicals to North Korean vessels on several occasions this year in breach of sanctions,” the first security source, who spoke on condition of anonymity, told Reuters. A second source, who independently confirmed […]

British trade group weighs domestic shale against Russian LNG

30 Dec 2017   United Kingdom

A British trade group said it’s better to tap inland gas than be vulnerable to foreign suppliers, as a vessel docked with its first-ever cargo of Russian LNG. Tanker Christophe de Margerie docked at a British port with the first cargo of liquefied natural gas ever delivered from the Yamal LNG plant in the Russian Arctic. French energy company Total said the vessel left the Arctic facility on Dec. 8. The Yamal LNG project has the capacity to produce about 16.5 million tons of natural gas. Up to 16 ice-class carriers could be designated to ship LNG year-round to global consumers from the far north Kara Sea. Ken Cronin, the chief executive at trade group U.K. Onshore Oil and […]

Surveys of oil basins in Russian Arctic completed

30 Dec 2017   Arctic, Russia

A Russian energy company said it completed surveys necessary to get a better understanding of the oil and gas reserve potential in Arctic waters. A subsidiary of Gazprom Neft said it finished seismic surveys of the Dolginskoye oil field and the Severo-Zapadny license block in the Arctic waters of the Pechora Sea. “The results obtained through these seismic works will remove any major subsurface uncertainties and allow Gazprom Neft’s subsequent geological prospecting program at the Pechora Sea to be put in place,” the company explained in a statement. The company reached a milestone last year with the production of its 10 millionth barrel of oil at the Prirazlomnoye field. Discovered in 1989, the field is roughly 35 miles from shore […]

UK receives first cargo from Russia’s Yamal LNG

The first cargo lifted from Yamal LNG has been delivered into the UK’s Isle of Grain terminal aboard the Arc 7 tanker, the Christophe De Margerie, according to data from cFlow, Platts trade flow software. Yamal LNG’s second cargo was expected to be delivered into the Rotterdam’s Gate LNG terminal aboard the Boris Vilkitsky. The third cargo will be loaded aboard the Fedor Litke, with the expectation that the vessel will berth at the Montoir LNG terminal. Market participants had said that the wide spread between prices in the Pacific basin and Europe meant all Yamal cargoes will be transferred to other vessels for delivery into other markets. By the start of Friday’s trade, the spread between the NBP February contract […]

Oil treading water even as Forties pipeline system returns to life

Oil prices started the trading day Thursday in static territory after pipeline operator Ineos said restrictions on a major North Sea network were lifted. “All restrictions on the flow of oil and gas from platforms feeding into the pipeline system have been fully lifted,” the company said in a statement. “All customers and control rooms have now been informed.” The Forties pipeline system, which carries about 40 percent of the oil and natural gas produced in the North Sea, was closed Dec. 11 after a hairline crack was discovered inland near Aberdeen, Scotland. Ineos said the line is repaired and the system should be back to normal as early as next week. The price of crude oil was more or less unmoved moments […]

All restrictions on Forties pipeline system lifted

29 Dec 2017   North Sea, Pipelines

Any limitations to the flow of oil and natural gas from the North Sea to the Forties pipeline system are now lifted, system operator Ineos said Thursday. Ineos shut down the Forties pipeline system from the North Sea to inland refineries on Dec. 11 after discovering a hairline crack on infrastructure near Aberdeen, Scotland. The system carries about 40 percent of the production from the British waters of the North Sea. The company said Thursday repairs to the pipeline are mechanically completed and it was progressing on the gradual full restart of the system. “All restrictions on the flow of oil and gas from platforms feeding into the pipeline system have been fully […]

Arctic development left Russian environment damaged

The development of parts of the Arctic north of Russia has left its environment at risk from scrap materials and oil residue, a regional leader said. Sakhamin Afanasyev, the minister of ecology for the Sakha republic, the largest in Russia, said companies working in the extreme climate have spent about $138 million this year on protecting the environment. Most of that was spent on treatment, waste management and emission abatement strategies. “Over the time of the north’s development, the environmental damage has been significant,” the minister was quoted by Russian news agency Tass as saying. “The biggest damage comes from scrap metal and from oil residues.” Some of Russia’s largest oil and gas projects are located in […]

Russia Bets on Shale Oil to Defend Its Spot as Top Producer of Crude

29 Dec 2017   Russia, Shale Oil

Companies like Gazprom Neft are leading Moscow’s drive to replicate the U.S. shale boom at the ‘Red Lenin’ oil field. KRASNOLENINSKOYE OIL FIELD, Russia—This western Siberian oil field is called “Red Lenin,” but its reserves have a distinctly American ring: shale. The future of the Russian oil industry could lie in the vast Bazhenov shale formation, the largest in the world. Russia has become the biggest global producer of crude oil with almost no contribution from shale, a sometimes technically difficult and expensive resource to pump. Only Americans have really gotten shale right so far, but the Kremlin is taking the first steps to unlock Russia’s potential. Companies like PAO Gazprom Neft GZPFY -1.78% are leading Moscow’s drive to replicate the U.S. shale boom, experimenting with a uniquely Russian, state-controlled approach to fracking that contrasts with the free-for-all among independent producers in Texas and North Dakota. “The Bazhenov is […]

UK North Sea Forties oil pipeline pumps at half capacity: source

Flows through Britain’s most important oil pipeline, Forties, have recovered to around half the normal rate, a trading source said on Wednesday, suggesting a steady return to normal operations after a rare unplanned shutdown. The closure since Dec. 11 of the pipeline, which normally pumps about 450,000 barrels per day, and supply disruptions in Libya have helped push oil prices above $67 a barrel, their highest since mid-2015. [O/R] Ineos, the pipeline’s operator, restarted the flow earlier in the week and has pledged to resume full volumes in early January. On Wednesday, Ineos could not immediately comment on current flow rates. “It’s a slow ramp up, but it’s about half the normal rate,” the trade source familiar with the operations said. Forties plays an important role in the global market as it is the biggest of the five North Sea crude streams underpinning Brent, a benchmark […]

Gazprom sees Chinese gas pipeline online in two years

China will start getting natural gas directly from Russia through the Power of Siberia pipeline in less than two years, the chairman of Gazprom said. The board of directors at Russian energy company Gazprom signed off on plans last week for 2018, noting gas transmission lines like Power of Siberia and the doubling of the twin Nord Stream network crossing the Baltic Sea to the shores of Germany were at the top of the agenda. In an address marking the New Year, Gazprom’s top executive, Alexei Miller , said about 850 miles of the gas pipeline to China will have been completed by Tuesday, the start of 2018. “That is two-thirds of the pipeline’s length,” he said in his remarks . “And I can […]

New oil coming out of North Sea

28 Dec 2017   North Sea

Tens of thousands of barrels of new oil are now coming from the Catcher development off the northeast coast of Scotland, Premiere Oil said Wednesday. Premiere said initial production from its floating production, storage and offloading vessel parked over the three fields that make up the Catcher area will be around 10,000 barrels per day. A peak rate of around 60,000 bpd is expected during the first half of 2018. Tony Durrant, the company’s chief executive, said first oil was achieved on time and, at $1.6 billion, almost 30 percent under budget. “Catcher is an example of Premier Oil’s capability to deliver full cycle FPSO projects from exploration through to […]

Forties Starts Pumping At 50% Capacity

28 Dec 2017   North Sea

The Forties pipeline system in the North Sea has begun pumping crude oil at half of its normal capacity, an unnamed source from the trading circles told Reuters. The Forties system supplies 40 percent of the UK’s crude oil. Ineos, the operator of the Forties pipeline, yesterday said it has started doing pressure tests on the pipeline after it was repaired. Full flow will resume in early January.“A small number of customers are now sending oil and gas through the pipeline at low rates as part of a coordinated plan that allows Ineos to carefully control the flow and pressure in the system,” the company said. Ineos shut down the Forties system in early December, following the discovery of hairline cracks. Initially, the company said repairs could take anywhere from two to four weeks, sending Brent soaring above US$65 a barrel. The pipeline normally pumps about 450,000 bpd, although […]

German December wind power output on track for record monthly high

28 Dec 2017   Germany, Wind

Wind power will be Germany’s biggest single source of electricity this quarter with a number of storms pushing wind output to new record-highs and December on track for a new monthly output record over 14 TWh. Christmas Eve, Boxing Day power prices negative on storms December wind average above 19 GW, up over 50% on year Total annual wind output already above 100 TWh Data from grid operators aggregated by think-tank Fraunhofer ISE as well as wind forecasts also showed that, on average, wind turbines will have generated some 19 GW each hour this month, a record monthly average and some 50% above December last year, the actual production data as well as a wind forecast by spotrenewables.com for the final five days of 2017 showed. Wind output this year, which has already passed the 100 TWh mark for the first time, was estimated to reach around 104 TWh, […]