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<>><<____________Volume 104:17-July-01-2004________________><<><><>>< >><<<<_____Editor: Charlie Bartholomew, kryopak@qwest.net_____<>><< >><<>>This issue distributes to 66 subscribers in 20 countries>>< ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< |
| XinAo Group to Build LNG
Plant BEIHAI, Jun 29, 2004 SinoCast via COMTEX Hebei-based XinAo Group, a large company engaged in a variety of businesses, will invest CNY 350 million in building a liquefied natural gas (LNG) project in Weizhou Island of Beihai City, south of Guangxi Autonomous Region. Beihai was named in 1662 for the sea that lies in the north (Bei=north, hai=sea) is in the southern part of Guangxi and in the northeastern coast of Beibuwan. It was built as a city in 1950. The project is one of the most important energy projects of the city in 2004 and will greatly improve the city's environment and the consumption of nature gas. Moreover, the LNG project in Weizhou Island is the first LNG project of Xinao Group Project Division. In particular, the project will liquefy and transmit from 40,000 to 50,000 cubic meters of natural gas, which is emitted from the terminal disposal plant of the West of the South ChinaSea Company of China National Offshore Oil Corporation (CNOOC) on Weizhou Island, to cities in Guangxi Autonomous Region. The first phase construction of the project will start on June 30, 2004 with an investment of CNY 150 million {~18 million USD} and the building of second phase will begin in 2005. The completion of first phase construction is scheduled to be before the end of May 2005 and residents in Beihai City can use the LNG processed by the project from May 1. Located in Beibu Bay, Wei Xinan oil field group was completed and put into production in June 6,1999. The associated gas from the oil field group is completely supplied to Weizhou Island in Beihai city. At present, the landed gas has been used to generate electricity and other projects basing on gas as fuels is under developing. Preferential Policies Towards Weizhou Island Weizhou Island enjoys special policies promulgated by the State Council and Guangxi Zhuang Minority Autonomous Region besides the preferential policies towards Beihai city. The Weizhou Island is the biggest volcanic island in China. The climate there is subtropical and Weizhou Island is known as 'Penglai Immortal Island of the South China'. "Essentials of the plan for the provinces in the south & southwest of China" worked out by the State Planning Commission was approved in Document No.56 promulgated by the State Council in 1993. It puts forward the following: Sanya, Jinghong and Weizhou Island can be developed into special and comprehensive tourist-amusement centers, which only serve tourists who come from foreign countries, Hongkong, Macao and Taiwan through leasing land and international advantages. Under the conditions of perfect facilities, these three places will be approved to state tourist vacation zones and enjoy relevant preferential policies approved by the state. Weizhou Island became a provincial tourist vacation zone approved in Document No.84 promulgated by Guangxi Zhuang Minority Autonomous Region in 1995. The document pointed out that Beihai Weizhou Island Tourist Vacation Zone, which is connected with Beihai Silver Beach State Vacation Zone, has subtropical natural scenery typical of South Asia along with features of a volcanic island. Weizhou Island attracts overseas and domestic tourists and investors with its special and rich tourist resources. In order to develop and utilize the tourist resources of Weizhou Island, promote the development of tourism in Beihai, Weizhou Island was approved to be an autonomous region tourist vacation zone. The overall plan for Weizhou Island Tourist Vacation Zone was appraised and approved by experts and authorities concerned. The infrastructure construction of Weizhou Island Tourist Vacation Zone should be organized and carried out according to the overall development plan. The development, construction and administration of Weizhou Island Tourist Vacation Zone should be carried out according to Document No.56 promulgated by the State Council in 1993 and Document No.104 promulgated by Guangxi Zhuang Minority Autonomous Region Government in 1994. In order to build Weizhou Island into a comprehensive tourist vacation zone with special functions for tourists who come from foreign countries, Hongkong, Macao and Taiwan, the relevant departments of Guangxi Zhuang Minority Autonomous Region will support the development of the Zone. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< CNOOC discoveries in Western South China Sea 29-12-03 CNOOC Limited announced that it has made two oil and gas geological discoveries in the Western South China Sea, offshore China and three discoveries in West Madura Production Sharing Contract (PSC) area, offshore East Java, Indonesia. Wildcat Weizhou (WZ) 11-1N-1 was drilled on WZ 11-1N structure, in the vicinity of existing Weizhou fields. Well logging data revealed an approximately 164 feet (50 meters) of oil zone. Songtao (ST) 24-1-1 is also a wildcat drilled on ST 24-1 structure. The well encountered oil and gas shows, which are of geological significance. Selected major discoveries of 1999: CONHW, Weizhou 12-1 5, Beibu, offshore, oil & gas, 7,089 Bo/d & 4.6 MMscf/d. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< LNG Terminal Lafayette, LA Marine Metering Platform Twin Brothers Marine 6/29/2004 URL: http://www.rigzone.com/news/article.asp?a_id=14373 Twin Brothers Marine, LLC, Port of West St. Mary, near Lafayette, LA, is fabricating the metering platform, including the deck, jacket, pilings, and metering skids, that is a component of the Woodlands, Texas's Excelerate Energy, LLC's Energy Bridge - the world's first offshore LNG import terminal - that will be installed 116 miles offshore Louisiana in 280 feet of water at West Cameron Block 603. Its President Kathleen Eisbrenner developed Excelerate Energy’s unique “Energy Bridge” concept, which has substantial cost, construction time, and environmental advantages over conventional facilities, and Vice Presidents Rob Bryngelson and Jonathan Cook while employed at El Paso Corp. Excelerate's primary owner is George Kaiser who is also the primary owner of Oklahoma's Kaiser-Francis Oil Co. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< LNG Development Freeport Closes ConocoPhillips Deal 07.06.2004 Cheniere Energy Inc. said Tuesday that Freeport LNG Development LP closed a deal in which ConocoPhillips will build and use a liquefied natural gas receiving terminal on Quintana Island near Freeport, Texas. Cheniere, a producer of oil and gas as well as a developer of natural gas terminals, holds a 30 percent limited partnership interest in Freeport LNG. ConocoPhillips acquired one billion cubic feet per day of re-gasification capacity in the terminal and obtained a 50 percent interest in the general partner that is managing the venture. The Houston-based oil and gas company also will provide a majority of the construction funding, Cheniere said. Dow Chemical Co., based in Midland, Mich., has contracted for the remaining 0.5 billion cubic feet per day, Cheniere said. Freeport received approval from the Federal Energy Regulatory Commission last month to build and operate a facility to produce 1.5 billion cubic feet of gas per day. The company said it expects to receive the remaining federal, state and local approvals in the third quarter. Cheniere said the companies plan to start construction in the fourth quarter and begin operations in the second half of 2007. Freeport chairman and chief executive Michael S. Smith said the Quintana facility will be the first liquid natural gas receiving terminal built in the continental United States in 20 years. "The capacity of the facility is equivalent to about 3 percent of the current U.S. gas production," Smith said in a statement. In addition to Cheniere's 30 percent stake, Contango Oil & Gas Co. owns 10 percent of Freeport. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< LNG Debate rages over rewards, risks ports By Laura Mecoy -- Bee Los Angeles Bureau July 6, 2004 LONG BEACH - Amid the massive cargo-bearing ships at one of the world's busiest seaports, a Mitsubishi subsidiary wants to build California's first terminal for importing liquefied natural gas from overseas. It claims the $400 million facility could meet 10 percent of California's natural gas needs and help avert another energy crisis. Opponents say terrorists or earthquakes could turn the terminal's vast stores of super-cooled gas into a mile-high fireball, destroying the port and scorching people and buildings a mile away in downtown Long Beach. "If you are close when that happens and you are out in the open, you are doomed," said James Fay, a Massachusetts Institute of Technology professor emeritus and liquefied natural gas specialist. "No one is going to (be able to) come in and rescue those people." The liquefied gas industry claims an outstanding safety record, tight security, strong structures, multiple government reviews and other safeguards. "We don't believe any accident will leave our property," said Thomas Giles, chief executive officer for Sound Energy Solutions, the Mitsubishi subsidiary proposing the Long Beach terminal. But the possibility of monumental fires and increased reliance on foreign fuels is generating growing opposition to recent proposals to put an LNG terminal at Long Beach and three more off Southern California's coast. Protests in Eureka and Vallejo already killed terminal proposals in those communities. Malibu's City Council voted to oppose two proposed terminals off its shores. The California Sierra Club is fighting all the proposals and has joined 26 other environmental groups in urging the state to pursue energy efficiency instead of new energy production. The environmental coalition plans to voice its concerns in a meeting today with state Resources Secretary Mike Chrisman and Environmental Secretary Terry Tamminen. Chrisman said at least one terminal should be built in the state, if it can operate safely without harming the environment. He plans a 10-day trip to Australia and South Korea later this month to tour LNG facilities. Gov. Arnold Schwarzenegger met with Australia's prime minister about Australian firm BHP Billiton's proposal to build an import terminal 14 miles from southern Ventura County's beaches. The governor has the power to veto offshore terminals but not the onshore one at Long Beach, a city of more than 460,000 people. Ashley Snee, the governor's spokeswoman, said the offshore terminal is "one of the possibilities" Schwarzenegger is examining to avoid an energy crisis. Rep. Doug Ose, R-Sacramento, is the chairman of a House of Representatives subcommittee examining the issue, and he said LNG is the best hope for substantially increasing the natural gas supply, thereby reducing gas prices. "We have a choice between paying $6 to $8 per cubic foot for natural gas, or we have the opportunity to drive the price down to $3," he said. "A $2 difference in price equates to $2 billion in additional costs for our homes and factories." The higher gas prices have made the fuel competitive with domestic sources for the first time in 30 years, and energy firms have proposed more than 30 terminals in the United States. Seven would be on the West Coast, where there are no facilities for receiving the fuel. The fuel is natural gas turned into a highly concentrated liquid by cooling it to minus 260 degrees Fahrenheit. Ships can carry vast quantities of gas in its liquid form and deliver it to the United States at one of four East Coast terminals. There, heat restores it to its natural gaseous state, and it's delivered via pipeline to customers. LNG is not flammable so long as it is liquid. But it can ignite when mixed with oxygen in concentrations of 5 percent to 15 percent. In an uncontrolled release, the Congressional Research Service said, a pool fire could erupt that would burn hotter and faster than a gasoline or oil fire. It said the fire could be extinguished only after all the fuel was consumed. Experts say LNG fires generate so much heat that people a half-mile from the flames could suffer severe burns. As a result, some experts have urged construction of offshore facilities. The Congressional Research Service said LNG released over water could create a "flameless explosion." Local residents opposed to terminals off the California coast claimed clouds of flammable gas could float onshore. Steve Meehan, project manager for the BHP Billiton terminal, said the "largest area of potential hazard is three to four miles." The BHP terminal would be located 14 miles from shore. Questions about the fuel's safety date back to 1944, when a Cleveland, Ohio, tank built with inferior steel ruptured and spilled LNG into the street and storm-sewer system. The gas ignited, triggering an explosion and fire that killed 128 people. The industry uses better steel today and has reported no further tank ruptures in the United States. It also argues its ships have made more than 33,000 trips in the past 45 years and experienced no major fires or explosions. In January, though, an explosion and fire at an Algerian LNG production plant killed 27 people. California and federal officials said the boiler that triggered the Algerian explosion wouldn't be used in U.S. import terminals. But the Sept. 11, 2001, terrorist attacks heightened fears of LNG terminals and ships being used as weapons by America's enemies. The federal government shut down LNG shipments through Boston's harbor for almost a month after Sept. 11 to ensure public safety. Opponents warn that a ship could be commandeered due to lax security. The Department of Homeland Security recently acknowledged that al-Qaida operatives linked to the failed 2000 millennium bomb plot at Los Angeles International Airport sneaked into the United States aboard Algerian LNG ships in the 1990s. In California, LNG terminal opponents say the state could become more vulnerable to terrorists if terminals are built here. Long Beach activist Bry Myown said the Long Beach and Los Angeles port complex is already considered a prime terrorism target. She said an LNG terminal would give America's enemies a powerful weapon because of all the volatile products at the port. "If anything blows up in that port ... it would set off a chain-reaction fire," she said. Fay, the MIT professor emeritus, said a small bomb-laden boat - like the one used in the October 2000 terrorist attack on the USS Cole in Yemen - could blow a hole in the side of an LNG tanker. He said LNG is so highly concentrated and stored and shipped in such large volumes that it holds more potential firepower than other chemicals and petroleum products. Mark Robinson, the director of the Federal Energy Regulatory Commission's office of energy projects, said the agency would evaluate all these concerns in deciding whether to permit the Long Beach terminal. "Safety is the No. 1 concern of the commission," he said. Robinson said Coast Guard officials guard against terrorism by inspecting LNG tankers and escorting them into port. He said his agency also seeks to protect the public by limiting its exposure to accidents at onshore facilities. In addition, he said LNG structures are "robust": The ships are double-hulled, and the storage tanks are encased in concrete. Opponents of the Long Beach terminal fear those structures still wouldn't be strong enough to withstand a major earthquake. Several earthquake faults are nearby, and the terminal would be built on landfill that a temblor can turn into liquid. "That could cause the structures to collapse, just like they did in the 1989 earthquake in San Francisco's Marina District," said Harvey Y. Morris, the California Public Utilities Commission's principal counsel. Giles, the executive advocating the Long Beach terminal, said seismic experts would ensure the terminal is safe. He said Japan has 20 LNG terminals, and none suffered damage in the 7.2 Kobe earthquake in 1995. Long Beach activists have reached out to environmental groups around the state to argue that all the LNG proposals could impede California's efforts to increase energy efficiency, conservation and alternative fuel usage. "We're not interested in exporting fossil fuels from Third World countries," said Bill Allayaud, California Sierra Club legislative director. "The Sierra Club stands for conservation." Other environmental activists also pointed out that LNG wouldn't arrive in California for another three to four years under the various project's timelines - and that might be too late to avoid the next energy crisis. For Long Beach, though, the proposed terminal would bring cheaper natural gas to heat homes, increased income to the city and the port and clean-burning LNG for their public vehicles. As a result, the port, some labor groups and some local officials have embraced it. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< Quebec distributor plans liquid gas terminal Allan Swift Canadian Press Sunday, July 04, 2004 MONTREAL (CP) -- Quebec's dominant natural gas distributor has embarked on an ambitious project to import liquefied natural gas so the province won't be entirely dependent on Alberta as its sole source of natural gas. Gaz Metropolitain has chosen its two partners for the project that would cost more than $2.7 billion, and has picked a site for a deepwater port and gas terminal near Quebec City. Enbridge Ltd. of Calgary, a part owner of Gaz Metropolitain, and Gaz de France, the leading gas utility in that country and a specialist in liquefied natural gas are the other partners in the Rabaska project. Gaz de France would be responsible for the $2 billion cost of securing contracts with suppliers, building LNG (liquefied natural gas) terminals at the supplier and providing four tanker ships to bring the liquid gas to the port on the St. Lawrence River. Quietly announced in April after two years of feasibility studies, the Rabaska project has just begun a two-year long regulatory stage of scrutiny by government agencies for environment, security and energy competition concerns. After that, it is expected it will take another three years to build a wharf, two storage tanks and equipment to turn the liquid back into gas and a 50-kilometre pipeline. Gaz Metropolitain and Enbridge would foot the $700 million bill. A series of meetings with local residents and other stakeholders begins this month. Fears have already been raised of an LNG explosion and fire like one that occurred in Algeria in January. Despite early opposition from locals, the promoters believe the project will be realized and start to function by 2009, to provide an alternative for Gaz Metro's 150,000 residential and industrial customers. The Rabaska project emerged after Gaz Metropolitain and partners failed to get approval for a natural gas pipeline to bring Sable Island gas to Quebec, explained Gaz Metro spokesman Jean Simard. With demand still growing, Gaz Metropolitain said it does not want to be entirely dependent on gas transported from Alberta via pipeline. Simard said the other customers between Quebec and Alberta have opted out of the Canadian pipeline and tapped into cheaper sources in the United States, leaving Gaz Metropolitain almost alone to cover the costs of 4,000 kilometres of pipeline transportation. "We've been trying for 20 years to diversify our gas sources, to get out of the captive situation we're in with TransCanada PipeLines,'' Simard said. "When you're paying for it all by yourself, the pipeline is pretty expensive.'' The feasibility studies discovered that the gas could be much cheaper in Norway. Simard said other sources could include Algeria. While natural gas prices in North America fluctuate in step with the price of oil, liquid natural gas is sold in long-term contracts and shipped through terminals built for each customer. Simard said there are four LNG terminals in North America, while another 40 are under study. On Friday, Calgary-based WestPac Terminals Inc. said it has entered into an agreement with Ridley Terminals Inc., a federal Crown corporation, to build an LNG terminal at the port of Prince Rupert, B.C. Also expected to reach completion by 2009, the Prince Rupert terminal would receive LNG from the Middle East, Indonesia and Australia for natural gas markets in western North America. Energy analyst Wilf Gobert with Peters & Co. in Calgary said the Rabaska and Prince Rupert projects are in the context of "a big movement within the United States to increase the supply of LNG.'' Gobert said North American gas prices have risen over the past four years, along with higher demand and dwindling continental supplies, all of which make LNG more viable, even though it has high installation costs. "One of the biggest risks (for LNG projects) is if gas prices were to go down significantly, it would be uneconomical,'' said Gobert, adding that it is more likely the current high oil price environment will persist. Gobert said a major challenge to establishing LNG terminals is local support, noting that residents of a town in Maine recently voted against one. "There's a bogeyman attitude towards LNG terminals; people think you've got a floating bomb,'' he said. Rabaska needs approval by provincial and federal environment boards, the National Energy Board, Transport Canada and the Canadian Coast Guard. Enbridge would use the gas to supply its customers in Eastern Ontario. © Canadian Press 2004 ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< PetroChina More High-Yield Gas Wells Discovered in Changqing Interfax Information Services, B.V. 7/1/2004 URL: http://www.rigzone.com/news/article.asp?a_id=14446 Three more gas wells with daily open-flow production of more than 1 million cubic meters have been discovered in northwestern China's Yulin Gas Field in Changqing as of June, said the leading Chinese oil producer PetroChina. The three wells, Yu 43-2, Yu 42-1, and Yu 47-5, reaped a respective 1.54 million cubic meters, 1.09 million cubic meters, and 1.38 million cubic meters of daily open-flow output in trial production, said PetroChina's official publication Zhongguo Shiyou Bao. The exploration progress has laid solid foundations for increased gas output from Changqing, said the company. PetroChina produced 7.28 million tons of crude oil and 5 billion cubic meters of natural gas from Changqing last year. It is expected that natural gas production from the area will double by 2005. China's largest gas field Sulige is located in Changqing and has proven reserves of 5.34 trillion cubic meters. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< LNG Terminal Debate Continues To Heat Up http://www.gazettes.com/grunionlng 07 01 2004.html By Kurt Helin Editor Federal officials will tour the site of a proposed liquefied natural gas terminal this month while continuing their fight with state officials about jurisdiction. Meanwhile, Port of Long Beach officials have delayed a study of just how dangerous an LNG terminal would be because of questions concerning the contractor selected for the study. While it will be several months before any kind of decision is made about the plans for an LNG terminal in the Port of Long Beach, the battle over those plans continues to rise toward a boil. Sound Energy Systems, a subsidiary of Mitsubishi Corp., has submitted plans to build a 27-acre, $400 million liquid natural gas terminal in the port that would open in 2008. The terminal could handle up to 68 million barrels of liquid natural gas a year. LNG is the same gas used in homes for cooking and heating, but chilled to minus 260 degrees, which turns it into a clear liquid that can be stored in large quantities in tanks. The gas can be reheated and used in homes. Currently an Environmental Impact Report study is underway, which will come before the port’s Board of Harbor Commissioners and ultimately the City Council for approval. With all the questions about the safety of the project, the Harbor Commission was going to consider hiring Quest Consultants to do a study about the dangers of the LNG terminal. However, questions surrounding Quest’s study done for an LNG terminal in Boston Harbor led to commissioners postponing the hiring for 30 days while port staff reconsiders the issue and company used. Eventually that study — done by Quest or another firm — will come back to the commissioners to be considered along with the full environmental report. While that approval process moves forward at the local level, the fight for who has control of approvals up the line continues, as well. Members of the Federal Energy Regulatory Commission (FERC) will be in Long Beach to tour the proposed LNG terminal location on July 13, an event that is open to the public. The next day, those same officials will conduct a closed-door meeting in the design and some of the technical aspects of the proposed terminal. That meeting will not be open to the public, with the reason that some of the details about security measures used to prevent problems at the site need to be kept out of the wrong hands. While FERC officials are touring the site, and FERC lawyers say the federal agency is the ultimate approval authority for the plans, the California Public Utilities Commission (PUC) has been fighting for its right to have the ultimate say over the project. Lawyers from the two sides continue to argue over who has the ultimate jurisdiction. From the day it was announced, plans for the LNG terminal have drawn stiff opposition from environmentalists, but support from some groups who see it as a source of inexpensive, clean burning fuel. The critics question what would happen if there were an explosion at the terminal, something that could potentially cause deaths in a two-mile radius, according to studies promoted by the environmentalists. That radius in Long Beach would include some homes and most of the very busy ports of Long Beach and Los Angeles. SES officials have responded by saying that the plant will be completely safe and that extensive precautionary measures will be built into the design. Those safety measures will become apparent in the approval process, they say. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< China to put gas generator sets into use next year http://www.gasandoil.com 17-06-04 Natural gas generator sets with a combined capacity of 6 mm kW will be put into operation in China next year to alleviate the power shortage, according to Hao Weiping, an official with the State Development and Reform Commission. Hao said at a recent forum on Sino-US oil and natural gas industry that by 2010 China's generating sets will have a combined installed capacity of more than 600 mm kW, with that gas turbines accounting for some 5 %. By the end of 2003, China had a total installed generating capacity of 385 mm kW, 24 % of which were from hydroelectric generators, 74.4 % from thermal-electric generators, and 1.6 % from nuclear generators, Hao said. Gas generating sets only had a combined installed capacity of 7 mm kW, he added. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< Volkswagen Brazil and IMPCO Team Up CERRITOS, Calif., June 30 /PRNewswire-FirstCall IMPCO Technologies, Inc. (Nasdaq: IMCO), announced today that its BRC brand products, specifically developed for the light duty automobile market, have been selected by Volkswagen Brazil for use in its Santana and Combi models. Installation of the BRC products on vehicles has been started. Volkswagen dealers in Brazil and Argentina will sell the vehicles. Additional Volkswagen models are being planned for production in the 2nd half of 2004. Volkswagen is the most popular car sold in the two countries, especially for taxis where Volkswagen has more than 50% of the market. There are over 125,000 taxis in Brazil and Argentina. With over 1.7 million natural gas fueled vehicles operating in Argentina and Brazil, the two countries together make up the largest alterative fuel market in the world. Natural gas is 54% the price of gasoline in Brazil and 33% in Argentina. Both governments are very active in influencing the use of clean burning natural gas to fight the severe air pollution in their major cities and to utilize their vast natural gas reserves as a replacement for imported liquid fuels. Regarding IMPCO IMPCO and BRC design, manufacture, market and supply advanced alternative fuel systems and related products to original equipment manufacturers and to the aftermarket for the mobile, industrial, power generation, and stationary engines market place. Headquartered in Cerritos, California and Cherasco, Italy, they have offices in Asia, Europe, Australia and South and North America. More information can be found at IMPCO's web site, http://www.impco.ws and at BRC's web site, http://www.brc.it. For further information contact Mr. Dale Rasmussen, Investor Relations: Email: drasmussen@impcotechnologies.com Phone: +1-206-315-8242 Fax: +1-206-315-8301 SOURCE IMPCO Technologies, Inc. Web Site: http://www.impco.ws ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< Spanish LNG Terminal Project Foster Wheeler Iberia / Soluziona Ingenieria Awarded Contract for By Reganosa HAMILTON, Bermuda--(BUSINESS WIRE)--June 30, 2004 Foster Wheeler Ltd. (OTCBB: FWLRF) announced today that its subsidiary Foster Wheeler Iberia, S.A., in a joint venture with Soluziona Ingenieria, S.A., has been awarded a contract by Regasificacion del Noroeste, S.A. (Reganosa) for project management consultancy at the new liquid natural gas (LNG) terminal project located at Mugardos-Ferrol, Spain. The terms of the contract were not disclosed. "We are very pleased that Reganosa has awarded Foster Wheeler /Soluziona Ingenieria this significant LNG project in Spain," stated Jesus Cadenas, chief executive officer of Foster Wheeler Iberia. "The natural gas market is one of the most active energy segments in the world and increasingly important in Spain, where demand is expected to double by 2010. Our work with Reganosa and other gas companies solidifies Foster Wheeler Iberia's position as one of the leading Spanish engineering contractors in the natural gas sector. This project also adds to the work Foster Wheeler is doing globally leveraging our deep experience in the important and growing LNG market." The LNG terminal project includes two 150,000 cubic-meter tanks, regasification facilities and pipelines. The project is scheduled to be completed during the fourth quarter of 2006. This will be the sixth LNG terminal to be constructed in Spain and will receive LNG from various sources. The booking was included in the first-quarter. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< CERI study finds LNG is poised to tackle US gas supply deficit Oil & Gas Journal 9-06-04 LNG will be well positioned to meet some of a projected natural gas supply deficit in the US, says a senior Shell International Gas executive. Ann Pickard, director, Shell global LNG and power, spoke on the gas outlook to a Canadian Energy Research Institute conference near Calgary. Another speaker at the CERI conference, David Hughes of the Geological Survey of Canada, said LNG is already factored into supply forecasts, but it will require a tripling of world LNG capacity, including new terminals and 212 new, 3 bn cf capacity tankers. Critical role Pickard said the day of gas is coming in North America and the rest of the world, and LNG will play a critical role. She said a lot of LNG projects will prove to be "pipe dreams," but many projects will and are proceeding. She noted Shell is going forward with a number of LNG projects, including new terminals in Nigeria, Malaysia, Spain, China, and Mexico over the next several years. Pickard said there are 32 active proposals and more being discussed around the world but not all will go ahead. "Companies that can provide tailored solutions for customers will be the ones that will go ahead in the future. The key will be flexibility and the ability to respond to customer needs," she said. The Shell executive estimated that $ 80 bn in capital spending will be needed for LNG development in the next decade. Pickard said global gas demand is expected to double by 2050, and globally there is no shortage with world gas reserves sufficient for 60 years and more gas to be discovered. She predicted a global gas market would emerge. There will also be a limited LNG spot market with a mix of contract types and a role for strong aggregate partners. Pickard noted there are high capital costs and a number of risks involved in the LNG business. These include permitting uncertainties, basic investment risks, and constraints on local pipeline projects. Politics, public opinion, and technology development will all be important to LNG development. One of the most serious problems, she said, is the NIMBY (not in my backyard factor) in which fierce local opposition has killed several US projects. Possible solutions, she said, are going offshore and expanding existing terminals. North American gas outlook Hughes also saw the NIMBY factor as a major obstacle. He noted that in North America natural gas was the fastest-growing fuel source during 1965-2002 and is expected to continue in that position. He said that world booked natural gas reserves are nearly 6,000 tcf, but North America has only 5 % of that total. Canada, he said, now supplies about 15 % of US gas requirements, but there are likely to be serious supply shortfalls in Canada, and it is unlikely to be able to fill the North American supply gap. Hughes said Canada and the US are on the same treadmill in which increased drilling has failed to stem declines in deliverability and reserves. North America, he said, now has just under 10 years of remaining gas reserves. However, Hughes said, Canada’s National Energy Board is bullish on the potential for coalbed methane (CBM) and estimates it could provide 23 % of Canada's gas production by 2025. Currently, Canadian CBM development is in its initial stages, and production is 50 mm cfpd. Hughes said Canadian gas reserves peaked in 2001 and in 2003 fell by 3 % from 2002 levels, despite record drilling activity. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< AIOC reports on oil production from Chirag field Interfax Information Services 10-06-04 Azerbaijan International Operating Company (AIOC, the operator for the Azeri-Chirag-Guneshli project in the Caspian Sea) produced 2.634 mm tons of oil from Chirag field in the first five months under the early oil project, a company source said. The company produced 538,000 tons of oil in May. Average daily production totaled 128,000 barrels, slightly more than the 125,000 barrels planned, he said. Oil exports from Supsa port in the first five months totaled 2.560 mm tons, including 523,000 tons in May. Production for the first five months was down 4.1 % year-on-year but this was a planned drop, he said. "The average daily production plan was 131,000 barrels in 2003 and 125,000 barrels this year. We plan work at the production platform in July when oil production will be suspended for a week. So planned production this year was lower than in 2003 but we are exceeding our plan," he said. AIOC include BP with 34.1367 %, Unocal 10.2814 %, ExxonMobil 8.0006 %, Devon Energy 5.6262 %, and Amerada Hess with 1.0413 %, SOCAR with 10 %, Inpex 10 %, Itochu Oil 3.9205 %, Statoil 8.5633 %, TPAO 6.75 %, and Delta Oil with 1.68 %. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< Bolivian congress backs oil and gas referendum The Financial Times 10-06-04 http://www.gasandoil.com Bolivia's president Carlos Mesa has won crucial political backing for a July referendum aimed at deciding the future of the country's oil and gas industry. Congress voted to provide a constitutional framework for the referendum, which was called in April by presidential decree. The country's Senate is also likely to approve the legislation. The vote means any challenges to the legitimacy of the referendum should founder in the constitutional courts. It will also help consolidate the president's mandate. Mr. Mesa assumed power last October when Gonzalo Sanchez de Lozada, the elected president, fled amid a popular revolt. That uprising was fuelled partly by opposition to private sector plans to export the country's abundant natural gas reserves. The $ 6 bn (EUR 5 bn, £ 3.3 bn) project -- led by BP and BG Group of the UK and Repsol-YPF of Spain -- involves piping the gas from Tarija, in southern Bolivia, to a liquefying plant on the Chile coast. From there it was to go to Mexico, where it would go into local and California gas and electricity grids. But popular opposition to using Chile -- a historic enemy -- as a port for the landlocked country held up government approval for the project, eventually shelved during last October's riots. Since then Bolivia has benefited from a regional energy crisis. An old pipeline into northern Argentina was reactivated, and Brazil has increased demand for gas. Yet questions about Bolivia's unexploited reserves remain politically sensitive. Three energy ministers have quit or been sacked since October, and fresh energy investment has hit its lowest level since privatization in 1996. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< Equatorial Guinea LNG Project Marathon & GEPetrol Finalize Marathon Oil 6/22/2004 URL: http://www.rigzone.com/news/article.asp?a_id=14136 Marathon Oil, the Government of Equatorial Guinea and Compania Nacional de Petroleos de Guinea Ecuatorial (GEPetrol), the National Oil Company of Equatorial Guinea, through subsidiary companies, have finalized all of the necessary agreements, including formation of Equatorial Guinea LNG Holdings Limited and GEPetrol's funding arrangements, for the companies' Equatorial Guinea liquefied natural gas (LNG) project. This marks the final investment decision for this LNG project, which is expected to be completed and begin shipping first cargoes of LNG in late 2007 -- a record setting pace from project inception to first delivery of LNG. This major investment is an endorsement of the Government of Equatorial Guinea's progressive policy to encourage private foreign investment and stimulate economic development. "Today's announcement marks a significant achievement for the Government of Equatorial Guinea, GEPetrol and Marathon that will fulfill our shared ambition to further commercialize the substantial gas resources of Equatorial Guinea. The Equatorial Guinea LNG project also is an important milestone in our ongoing implementation of Marathon's integrated gas strategy," said Clarence P. Cazalot, Jr., President and CEO of Marathon. "This LNG project is an excellent investment opportunity that will yield attractive rates of return enabling both Marathon and Equatorial Guinea to create sustainable value growth. We also are pleased to be working with GEPetrol and the Government of Equatorial Guinea to develop a project that will provide economic, social and environmental benefits for the citizens of Equatorial Guinea." This project will be one of the lowest cost LNG operations in the Atlantic basin with an all-in LNG operating, capital and feedstock cost of approximately $1/mmbtu at the loading flange of the LNG plant. Currently Marathon, through a wholly owned subsidiary, is funding a 75 percent interest in the LNG project, with GEPetrol funding the remaining 25 percent. Marathon and GEPetrol have received expressions of interest from a number of companies about acquiring an equity interest in the LNG project. Natural gas for the project will be purchased from the Alba field participants, Marathon, Noble Energy, Inc. and GEPetrol, under a long term gas supply agreement, and 3.4 million metric tons per year of LNG will be sold to BG Gas Marketing Ltd (BGML), a subsidiary of BG Group plc, under a 17 year purchase and sale agreement beginning in late 2007. BGML will purchase the LNG on a free on board (F.O.B.) basis at Bioko Island, Equatorial Guinea, with pricing linked principally to the Henry Hub index. BGML intends to target the Lake Charles (Louisiana) import terminal as the primary destination for the LNG; however, the agreement provides destination flexibility for the LNG, enabling BGML to take advantage of prevailing market conditions at other import destinations around the world. Commenting on today's announcement, Atanasio Ela Ntugu Nsa, the newly appointed Minister of Mines, Industry and Energy said, "The Government of Equatorial Guinea and GEPetrol are very pleased to be a part of a project that holds such significant potential for Equatorial Guinea and its people. We believe the LNG project is an important sign of the international community's confidence in the stability and economic progress of our country. In addition, this project will enable us to further develop our abundant energy resources bringing economic and social benefits to the people of Equatorial Guinea. We look forward to pursuing further LNG developments with Marathon in the future." The LNG plant will be located on the northwest side of Bioko Island at Punta Europa, near Equatorial Guinea's capital city of Malabo. Bechtel has been appointed the primary engineering, procurement and construction contractor and has been given notice to proceed. Construction costs are estimated to be approximately $1 billion or an equivalent of approximately $260 per metric ton of installed capacity. In addition, other costs associated with the project are estimated to total approximately $400 million representing project management costs, contingency, working capital, taxes, training programs, operations setup, insurance and other related activities. Preliminary construction work on the plant began in December 2003, and work is progressing on schedule with site preparation, accommodation, equipment mobilization and ordering of major plant components. The Equatorial Guinea LNG plant will utilize the Phillips Optimized Cascade Process. While the contracted offtake rate is 3.4 million metric tons per year and the offtake term is 17 years, the plant is expected to have the ability to operate at higher rates and for a longer period. Key plant facilities will include: refrigeration systems, compressors, condensers, two LNG storage tanks and marine facilities that will allow for the berthing, mooring and loading of LNG ships ranging in size from 90,000 to 160,000 cubic meters of both membrane and spherical design. Complementary Operations The participants in the Alba field, in which Marathon holds a 63 percent interest and serves as operator, have recently completed the Phase 2A natural gas condensate expansion project. Phase 2A, which is mechanically complete, will increase total liquids production from approximately 20,000 gross barrels per day (bpd) to approximately 59,000 gross bpd (32,000 bpd net to Marathon). This project also is eliminating the need to flare gas, preserving the resource while reducing emissions associated with flaring. In addition, Alba Plant LLC (a joint venture company owned 52 percent by Marathon, 28 percent by Noble and 20 percent by Guinea Equatorial Oil & Gas Marketing Ltd.(GEOGAM)), is expanding liquefied petroleum gas (LPG) production capacity. With all major equipment installed, the Phase 2B LPG expansion project is expected to start-up late this year or early 2005. Upon completion of Phase 2B, gross liquids production is expected to increase from approximately 59,000 bpd to approximately 79,000 bpd (44,500 bpd net to Marathon). Approximately 120 million cubic feet per day (mmcfd) of dry gas remaining after the condensate and LPG are removed is supplied to the existing Atlantic Methanol Production Company LLC (AMPCO) methanol plant on Bioko Island where it is used to manufacture 2,700 tons of methanol per day. AMPCO is a joint venture company owned 45 percent each by subsidiaries of Marathon and Noble, and 10 percent by GEOGAM. All remaining dry gas will be returned offshore and re-injected into the Alba reservoir for later production when the LNG plant is completed. The Alba field holds estimated remaining gross risked recoverable resource of 4.4 trillion cubic feet (TCF) of gas, of which approximately 3 TCF is expected to be produced through the LNG plant under the contract with BG, and 400 million barrels of liquids. Recognizing the additional resource potential of the Alba field and surrounding offshore areas of Equatorial Guinea, Marathon is conducting an exploration program on the Alba Block and the adjacent Block D offshore Equatorial Guinea. Recently, the company announced the Deep Luba natural gas and condensate discovery on the Alba block (Sub Area A), in which the company holds a 63 percent interest. This discovery is in addition to the 2003 Bococo discovery on Block D, in which Marathon holds a 90 percent interest and serves as operator. Opportunities to utilize the full capacity of the first LNG train and any expansions could come from these discoveries as well as the adjacent gas discoveries in neighboring areas. At year-end 2003, Marathon's proved reserves in Equatorial Guinea totaled more than 315 million barrels of oil equivalent. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< Namibia Tullow Oil to Develop Natural-Gas Field Sunday Business, London 6/22/2004 URL: http://www.rigzone.com/news/article.asp?a_id=14168 Tullow Oil will next month announce it is to develop the Kudu gasfield off the coast of Namibia. The news comes 30 years after the field's discovery and two since Royal Dutch/Shell abandoned its 75 percent stake in the project. Tullow's legal and commercial director Graham Martin said: "There will be an announcement on Kudu within the next month. All the relevant parties believe there's a commercial project here. It's just a case of finishing off the work with banks and others." Tullow gained the Kudu stake when it bought Energy Africa earlier this year, but it has so far refused to commit to developing the field. Shell abandoned its stake in 2001 after drilling failed to prove up sufficient gas reserves to justify liquefying the gas for export. Its partner Chevron Texaco followed last year. Tullow now has a 90 percent stake, with the remaining 10 percent owned by Namibian oil company Namcorp. The proved reserves of the field are 1.3 trillion cubic feet of gas, far less than is generally needed for a liquefied natural gas scheme. Tullow plans to adopt Energy Africa's scheme to hook the field up to an 800MW gas turbine to generate electricity to the West African state and for export to nearby South Africa. Elsewhere Tullow recently began drilling one of Energy Africa's most exciting prospects, the Cap Draa well off the coast of Morocco. Tullow has appointed the renowned industry consultants Cambridge Energy Research Associates to manage its integration with Energy Africa. The company on Friday started the compulsory purchase procedure to buy up the remaining few percent of Energy Africa shares, which will soon bring its ownership of Energy Africa to 100 percent. Shareholders objecting to the purchases can contest the acquisition in court but Martin said Tullow could see no legal arguments to stop the acquisition. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< BP LNG terminal inaction on permit baffles DNREC Company proceeds with natural gas terminal plan 'at its own risk' in face of Coastal Zone Act By JEFF MONTGOMERY Staff reporter 06/26/2004 http://www.delawareonline.com Delaware officials said Friday they were puzzled by energy giant BP's continued inaction on a key state permit review for a liquefied natural gas terminal near Claymont, and cautioned that the company was gambling by pursuing other parts of the $500 million project first. In a letter to federal regulators released Friday, the Department of Natural Resources and Environmental Control officials also cited terrorist threats and accidents as important considerations for a federal environmental impact study. BP wants to build a terminal along the Delaware River in Logan Township, N.J., opposite Claymont. Company designers say the terminal would receive about two tankers of super-chilled liquid weekly and would send out 1.2 million cubic feet of gas daily, equivalent to the daily energy needs of 5 million homes. The proposal has received wide support from business and industry groups on both sides of the river, and opposition from some environmental and citizen groups. Neil Chapman, spokesman for BP, said Friday that the company would meet its obligations, but did not elaborate on timing. "Quite simply, we have over 100 permits that we need to apply for. We've got to mature some of those permits to make sure when we make an application that we have a robust one," Chapman said. Although the terminal would stand in New Jersey, piers, docks and unloading pipes would occupy a part of the river inside Delaware. State lawmakers declared all of the river and 275,000 acres of adjacent land off-limits to bulk unloading terminals or heavy industries in 1971, with passage of the Coastal Zone Act. BP applied for a Federal Energy Regulatory Commission review in January, but has yet to seek Delaware's opinion on the Coastal Zone law. "They're clearly moving down some other paths. We've said, and I think we've been consistent, that a Coastal Zone status decision is certainly warranted in this project as a first step," said David Small, DNREC deputy secretary. "To the extent that BP is moving ahead, they do so maybe with some risk, but I think they recognize that." Dennis Brown, DNREC's Coastal Zone Act manager, said he had discussed Delaware's law with BP. The company, he said, was proceeding "at its own risk." BP has said it wants to open the terminal by 2008, and told federal officials the timing would allow the company to take advantage of new supplies in Trinidad due to become available at about the same time. The company's federal application identified DNREC as one of the agencies with which the company must work. The terminal is one of dozens now under consideration around the nation as energy companies scramble to take advantage of rising demand for clean-burning natural gas. Controversies over risks posed by the tankers and terminals and their vulnerability to attack have increased in recent months. One recent study found that a limited puncture of a tanker could trigger a fire that would cause blistering heat up to nearly a mile away. DNREC officials asked federal reviewers to examine a wide range of environmental and safety impacts in the letter released Friday. "In particular, the potential secondary environmental impacts of an explosion on nearby tank farms, electric generating facilities or industrial facilities adjacent to the proposed facility and along the length of the Delaware River should be studied," DNREC manager Philip J. Cherry wrote. Coast Guard officials have declined to speculate on security precautions for the huge tankers. Vessels serving an existing terminal in Boston have armed escorts with traffic required to maintain clearances of up to two miles. ><<>><<>><>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><<>><< ExxonMobil Donates $50,000 to Haiti and Dominican Republic Relief Efforts RVING, Texas--(BUSINESS WIRE) June 14, 2004 Exxon Mobil Corporation (NYSE:XOM) announced today a donation of $50,000 to the Pan American Development Foundation (PADF) to help in relief efforts for the recent flooding, which killed hundreds and left thousands homeless in Haiti and the Dominican Republic. In coordination with the Haitian and Dominican governments and with the support of the private sector, PADF is providing immediate supplies of food, water, and shelter to victims of this tragedy. After immediate needs are met, PADF will work with local partners to help rebuild communities and roads destroyed in the flooding. PADF, created in 1962, is an affiliate of the Organization of American States (OAS), and has worked over the last four decades to improve conditions for thousands of disadvantaged Latin American and Caribbean people. The ExxonMobil grant will be divided equally between the two countries. In addition to the donation, local subsidiaries and employees are providing immediate in-kind assistance to flood victims. ExxonMobil subsidiaries have operated in Haiti for more than 80 years, and in the Dominican Republic for 100 years. Over the years ExxonMobil subsidiaries have demonstrated their commitment to Haiti and the Dominican Republic, and will continue to do so. |