GDF Suez signs a Memorandum of Understanding and Cooperation with Pemex

PARIS -- On the occasion of the visit of a French government delegation to Mexico, Gerard Mestrallet, Chairman and CEO of GDF Suez, signed a Memorandum of Understanding and Cooperation with Emilio Lozoya, Chairman and CEO of Pemex, to develop natural gas and other energy projects in Mexico.Mexican and French Presidents Enrique Pena Nieto and Francois Hollande were present at the signing.

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Ukraine Standoff Escalates, Could South Stream be in Doubt?

When completed, the South Stream pipeline will run from Russia, underneath the Black Sea to Bulgaria, and on to Western Europe. It will carry Russian natural gas to Europe while bypassing Russia’s neighbor Ukraine. Russia clearly finds this pipeline to be strategically important – the Kremlin would be able to operate with greater freedom when using natural gas to bully Ukraine, and it wouldn’t have to worry about angering its large customer base in Western Europe.

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The Absurdity of US Natural Gas Exports

Quiz:1. How much natural gas is the United States currently extracting? (a) Barely enough to meet its own needs(b) Enough to allow lots of exports(c) Enough to allow a bit of exports(d) The United States is a natural gas importerAnswer: (d) The United States is a natural gas importer, and has been for many years. The EIA is forecasting that by 2017, we will finally be able to meet our own natural gas needs. Figure 1.

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Fiscal break-even oil prices for major OPEC members

One of the key drivers of the oil markets is the price at which principal OPEC producers balance their government accounts – better known as fiscal break-even oil prices. By monitoring the fluctuations of these break-even prices in major oil-producing countries such as Saudi Arabia, Iran, Iraq, Kuwait and the UAE, we can assess potential changes in OPEC’s desired level of global oil prices.

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How Crimea Hurts Russia

Since the dissolution of the Soviet Union, slowly but surely NATO added members in Eastern Europe. Likewise, the European Union opened up its doors to its eastern neighbors formerly in Moscow’s orbit. Russia saw this as a threat, and upon the downfall of Viktor Yanukovych, Russia saw the loss of Ukraine as something that it could not tolerate. From this perspective, Vladimir Putin likely feels that by seizing Crimea he stopped the expansion of a NATO-backed plan to expand eastwards.

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Here's an Unexpected Vote For Coal

There's a lot of money to be made spotting market bottoms in commodities. Buying producers and projects at ultra-low valuations, before the inevitable uptick in a sector.Market commentaries are a key indicator in this regard. With bottoms usually being marked by "irrational apathy"--illogical reasoning from market bears who've simply been spooked by falling valuations in unloved sectors.There's been a lot of such sentiment lately in coal.I was particularly struck by one comment the last few weeks. From a high-profile market analyst, who noted that…

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The Dakota Access Bakken Crude Gateway to the Gulf

No sooner had we finished up our analysis of the divergent fates of two North Dakota crude oil pipeline projects - the Enbridge Sandpiper (going ahead after a successful second open season) and the Koch Dakota Express (cancelled in January) – then we learned that competitor Energy Transfer Partners (ETP) had launched a binding open season for a third pipeline proposal following basically the same route.

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Private Equity Bets $2 Billion on This Commodity

There's a shuffling of investors going on, according to reports this week. In one particular market: natural gas.On the way out of this market is major Canadian producer EnCana. Which is looking to offload dry gas assets as it whittles down its project portfolio to a more manageable size.Local media noted this week that one of the first fields to go may be the Jonah project in Wyoming.

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This Critical Coal Event Is Back On

There's an eerie silence in the coal market right now.Trading sources like Platts are reporting that coal transactions globally have suddenly gone very quiet. At least in certain segments of the market.Particularly for lower-grade thermal coals. With sources noting that demand for 3,800 kcal/kg product is "nearly absent" from the market.The reason for the lull has been somewhat mysterious.

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This Week in Energy: How Would LNG Get to Ukraine?

With all the talk about using US natural gas exports as a weapon to fight Russian aggression in Ukraine, what no one’s asking is how this liquefied natural gas (LNG) would get to Ukraine (or Europe in general) in the first place. The answer is Turkey—if Turkey is willing to play ball. The potential for LNG exports to Europe without a deal between Turkey and Ukraine for the transport of LNG through the Bosphorus will fall flat.

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A Massive Oil Shortage Here Could Drive Exploration

Very interesting figures on oil production coming out of Australia last week. Showing the nation may be on the verge of a petro-crisis.Adelaide-based analysts EnergyQuest released their quarterly review of the Aussie oil and gas sector. Noting some stunning changes in production during 2013.Most notably, oil production across the nation took a tumble.

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Russia Aggression Paves Way for Ukrainian Energy Coup: Interview with Yuri Boyk

As Ukraine’s Crimean Peninsula is lost to Russia, with a referendum on the peninsula’s independence planned for Sunday and the specter of a Russian military advance on eastern Ukraine looming large, we are witnessing a crisis of international proportions. The key to this crisis is energy. Russia’s aggressive move on the Crimea may in fact be the international catalyst Ukraine needs to pave its own energy independence--with a little help from its friends.

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Can the United States Rule the (Energy) World?

Geopolitical crises in Eastern Europe have been met with calls in the United States to use energy as a foreign policy tool. With U.S. Energy Secretary Ernest Moniz asking the industry to make a stronger case, however, it's domestic policies that may inhibit energy hegemony. "The industry could do a lot better job talking about the drivers for, and what the implications would be, of exports," Moniz told an audience at the IHS CERAWeek energy conference in Houston.

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Russia Plays Ukraine Gas Card—Again

Russia appears to be backing down slightly over Ukraine, with President Vladimir Putin saying that military force would be a last resort amid the threat of US sanctions, but Moscow is expectedly playing the gas card—again. Speaking in a live televised address on RT News, Putin said Russia would employ military force in Ukraine as a last resort, but still reserved the right to use all options in Ukraine to protect from the threat of “terror”.

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Shale Gas Cuts into Natural Gas Trade

The boom in shale gas production over the last decade has eaten away at natural gas imports. New data released by the Energy Information Administration shows that the value of U.S. imports of natural gas hit their lowest levels in over 20 years. The U.S. imports natural gas largely through pipelines from Canada, but with such an abundance of domestic gas production, imports have dropped precipitously since 2005.Yesterday, EIA released data showing that tight oil production has led to a significant drop in oil imports. Today’s data shows a…

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IEA: Large-Scale Integration of Renewables Not Costly

A new study released by the International Energy Agency concludes that the large-scale adoption of renewable energy technologies like solar and wind can come at “little additional cost in the long term.” Solar PV and wind could generate 30% of a given market’s electricity generation without significant economic disruption. The IEA notes that much depends on the flexibility of the market, and how power markets are governed in an individual country.

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DOT Issues Emergency Order for Crude Oil Rail Transport

The U.S. Department of Transportation issued an emergency order on February 25 to address the safety of transporting crude oil by rail. According to the order, all shippers moving crude from the Bakken must test their product to ensure it is properly classified before transit. The order came in response to the series of crude oil train derailments, some of which led to explosions and injuries.

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Israel, Jordan Sign Gas Deal While Kurdish Oil Battle Lives On

This week in energy we feel compelled to head to the Middle East, where we have seen movement on Israeli gas—another boon for US-based Noble Energy Inc.—and the hydrocarbons showdown between the Iraqi central government and the Kurdistan Regional Government (KRG), two issues we have covered extensively during the past two years.The big news is that Israel and Jordan have signed a deal that will see Israel supply Jordan with $500 million in gas from the Tamar natural gas field in the Mediterranean, which started producing in March last…

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Opportunity for U.S. Lng Exporters May Be Limited

Natural gas prices in the U.S. for quite a few years now have hovered between the $2 and $4 per million btu (MMBtu) range, while they have reached as high as $19/MMBtu in Japan. The oil and gas industry have pushed the federal government to accelerate its permitting of LNG export terminals in order to take advantage of what is seemingly an easy arbitrage opportunity. They also argue it will be good for the American economy, energy security, and national security.

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Crude, NGLs and natural gas outlook

Natural gas production in the Lower 48 has surged 40% since 2005 – hitting record levels in recent months in spite of low prices and a drilling migration away from dry gas to liquids plays. Following a similar trajectory, NGLs output from gas processing plants jumped 40% since 2009 as drilling for wet gas accelerated. Crude oil production from shale did not take off until the end of 2011 but since then has surged an astronomical 56 percent to 7.8 MMb/d.

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For Exports, and Oil, You Can’t Beat Texas

Texas is on an export roll, recording a new record last year, with Houston leading the way and expecting more to come with the recent approval of a new liquefied natural gas (LNG) export facility. According to a report by US Secretary of Commerce Penny Pritzker, Texas was one of 16 US states to set new exports records in 2013, taking the top spot followed by California and Washington, while US exports reached a new high total of $2.3 billion for 2013.

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Exxon Starts Production at New Malaysia Gas Field

ExxonMobil’s subsidiary in Malaysia has begun natural gas production at the offshore Damar field, preparing Malaysia to boost its current status as the world’s third-largest exporter of liquefied natural gas (LNG). ExxonMobil Exploration and Production Malaysia has announced the startup of natural gas production from Damar field, which lies in 55 m of water about 200 km offshore eastern peninsular Malaysia.The filed has a projected capacity of 200 million cubic feet of natural gas per day.

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Oil Train Derailments Reaching Crisis Point

On February 13 a Norfolk Southern Railway train bound for New Jersey derailed in Vandergrift, Pennsylvania. About 3,500 to 4,500 gallons of crude oil spilled, although miraculously it somehow didn’t leak into nearby water supplies. The Federal Railroad Administration announced that it will investigate the crash.

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