Thursday, March 6, 2014

Total expects to start drilling in mid 2015 | Cyprus News Agency

Total expects to start drilling in mid 2015 First Published: 06/03/2014 11:47 

French company Total expects to start drilling in Cyprus’ Exclusive Economic Zone (EEZ) in mid 2015, Managing Director of Total E & P Cyprus Jean-Luc Porcheron has said.

Jean-Luc Porcheron was speaking during a presentation organized by the Cyprus-French Business Association entitled “Total in Cyprus: A long term perspective”.

He said that “this is just the beginning of exploration in Cyprus”, noting that “we have a lot of work to do before drilling which means that we will probably not be able to drill before mid 2015”.

He stressed that “we will try our best to carry out our activities in a timely manner but we cannot skip all the technical stages”, urging everyone in Cyprus to be patient.

Total top official also said that LNG offers optimal flexibility for marketing and value creation, noting at the same time that LNG project (onshore) brings long term benefits to a country.

He also said that there are alternatives which may be economically viable that depends a lot on the quantity of gas found.

He went on to say that “we are considering all options” including that of a pipeline.

However he admitted that “pipeline does not offer flexibility” while he stressed that it is imperative to have “a good and long term relationship” with the county where the pipeline`s end point will be. “That’s critical” he concluded.

French company Total was granted hydrocarbon exploration licenses in blocks 10 and 11 of Cyprus’ EEZ after signing two production sharing contracts with the Ministry of Commerce, Industry and Tourism in Nicosia in February last year.

Total E&P Cyprus Ltd has been granted a license by the Agriculture Minister for seismic exploration for oil and gas in block 10 and in parts of blocks 6, 7 and 11 of Cyprus’ Exclusive Economic Zone.

The company will carry out a two-dimensional seismic survey using a specific type of vessels to locate hydrocarbons in the specific blocks. The license is valid for three months, from the 1st of February until the 1st of May, and can be renewed by the Minister.

Preliminary results of a Noble Energy appraisal well for natural gas in Block 12 of Cyprus’ Exclusive Economic Zone estimate the hydrocarbon reserve between 3.6tcf and 6tcf with a gross mean resource of 5tcf. Noble Energy operates Block 12 with a 70 percent working interest. Delek Drilling Limited Partnership and Avner Oil Exploration Limited Partnership each own 15 percent.

Source:  Cyprus News Agency
http://www.cna.org.cy



Link to source: http://www.stockwatch.com.cy/nqcontent.cfm?a_name=news_view&ann_id=193553&lang=en

Woodside's Leviathan deal at risk | The Australian

Woodside's Leviathan deal at risk

Woodside Petroleum's $US2.6 billion ($2.85bn) entry into the giant Leviathan offshore gasfield could be at risk, with the Israeli Ministry of Finance reportedly unwilling to recommend the Perth company's desired taxation regime for LNG exports.

Israel's Globes newspaper says a gas export tax committee is set to provide Prime Minister Benjamin Netanyahu with recommendations that a planned Woodside-operated LNG plant be taxed at a higher rate than Woodside wants.

As reported in The Australian this week, Woodside's entry terms into Leviathan are conditional on tax issues around transfer pricing being sorted out by March 27.

If the conditional deal, signed last month with the Noble Energy-led Leviathan joint venture, is not made binding by that date, it is no longer exclusive and terms can change.

Woodside chief Peter Coleman has said the tax issues may not be sorted by the deadline date and that Woodside's willingness to sign the deal may depend on signals from the government.

The Globes report said the recommendations could still be overruled by Mr Netanyahu in Woodside's favour.

Last month, Woodside agreed to pay $US2.6bn in stages to take a 25 per cent stake in Leviathan and operate a planned floating LNG plant. This deal superseded one signed in December 2012, where Woodside was to pay up to $US2.3bn for a 30 per cent stake.

The revised deal offers more cash for a smaller stake because more pipeline exports are expected from Leviathan, at the expense of LNG exports. This would make it cheaper to develop and therefore a more valuable field.

Woodside declined to comment on the Globes report yesterday. Speaking to The Australian after Woodside's full-year results last month, Mr Coleman said Woodside had been advising Israel, which had not yet exported any gas, to adopt a similar transfer pricing regime to that in Australia.

Globes, which did not reveal its sources, said Woodside had approached Israel's finance minister, Yair Lapid, to say the government's proposed yield rate for FLNG operators was lower than standard practice.
But this does not look to have swayed the ministry.

"The Ministry of Finance is convinced that gas exporters, because they belong to the midstream part of the industry, have far lower risk than the gas exploration companies, because in the export stage there is already considerable certainty," Globes said.

The big field holds 19 trillion cubic feet of gas, about half of which is planned for export.

This is about half the reserves of the massive Gorgon project off Western Australia.

The deal is key for Woodside and has the potential to lift its contingent gas reserves by 50 per cent. It is also vital for Israel, which will boost export revenue if it can support the Leviathan venture's goal of a floating LNG plant.

A sweetener for Israel is an aggressive production timetable Mr Coleman flagged last month.

He said the joint venture could be in a position to make a final investment decision on a floating LNG development by the end of next year.


Link to source: http://www.theaustralian.com.au/business/latest/woodsides-leviathan-deal-at-risk/story-e6frg90f-1226847559642

ΦΑ: Από το τερματικό στον αγωγό μέσω Τουρκίας | Sigma LIVE




Link to source: http://www.youtube.com/watch?v=mclP8l_G_W0#t=53

Wednesday, March 5, 2014

Russia Can't Afford To Turn Off The Gas | Forbes

Energy 1,570 views

Russia Can't Afford To Turn Off The Gas

Over the last few days, talking heads from Washington to Moscow have repeatedly pointed out how little the U.S. has to work with when dealing with pressure from Russia and what a strong hand Putin and company currently hold when it comes to their presence in Ukraine. However, upon closer inspection, one of Russia’s most effective diplomatic weapons has turned out to be not just weaker than first thought, but would have them ‘shooting themselves in the foot’, according to Temuri Yakobashvili, a Senior Transatlantic Fellow at the German Marshall Fund.

What is this exactly? Energy – specifically Russia’s oil and natural gas exports to Ukraine and the greater European market.

As this column touched on earlier this week, Russia has had no problem wielding their reserves in times of trouble, most effectively in 2009 when Moscow halted imports to Ukraine amid a pricing disputes. Implemented during the frigid days of January, the move gave Russia the advantage and highlighted Europe’s delicate dependence on Russian reserves.

However, the 2009 shutdown also spurred a new approach to meeting energy needs across Europe.
A series of infrastructure investments, increased storage efforts and new import agreements allowed Ukraine, Germany and the rest of those countries affected by a potential Russian shutdown to grow less dependent on Moscow. While Europe still looks to Russia for about 30 percent of its natural gas demand, with about half of that amount delivered through Ukrainian pipelines, the current energy landscape also leaves Moscow increasingly dependent on the EU for vital energy revenue.
According to the U.S. Energy Information Administration, 84% of Russia’s oil exports and 80% of its natural gas exports went to European Union consumers. Any delay or halt in that amount would leave Russia with a “massive hole in the country’s budget”. Further, the move would pack far less punch than it did in 2009 as Germany and the rest of Europe have more choices for alternatives than ever before, including Norway and Algeria. Finally, forward thinking and a mild winter have allowed those countries would be most affected to build significant reserves that could last them months. Even Ukraine boasts some storage reserves and has recently signed a new agreement with Germany to import natural gas, according to Yakobashvili.

Coupled with proposed sanctions from the U.S., the move would prove a significant fiscal challenge to Moscow and one unlikely for Putin to pursue under current conditions.

“From an economics perspective I think there is no rationale for Russia to contemplate shutting off exports and we don’t think it is at all in their interest to do so for any amount of time,” said Will Person, Director, Global Energy and Natural Resources. “Especially as that would reinforce European efforts to diversify.”
In addition to lending more support for ongoing diversification efforts in Norway and North Africa, the current tension has produced increased calls for easing U.S. rules on exports to allow Europe easier access to shale gas output.

“You have to remember the (oil and gas giant) Gazprom is one of the backbones of the Russian economy and the gas industry is a very fragile business,” Yakobashvili said on Tuesday, adding that Russia was facing a very different environment than 2009. “You don’t do stupid things more than once.”

This is not to suggest that Europe would not suffer if Russian imports were halted or delayed in any way. Uncertainty about the Ukraine has already caused prices to rise amid worries that the situation could restrict global supply. According to a Bloomberg report from March 2nd, U.K. prices for next month gas deliveries “surged the most in more than 17 months, rising as much as 10.3 percent” as a result of regional concerns.
The current uncertainty could be preferable if Russia decides to expand its presence into Ukraine and armed conflict breaks out.

“Then all bets about economic rationality are off,” Pearson said on Tuesday. “We don’t think this will happen but it’s clearly tenuous and would be game-changing.”

However, with an estimated $100 million in lost revenue a day, any impact would be felt in Moscow as well – a fact that Putin would find difficult to ignore.


Link to source: http://www.forbes.com/sites/christophercoats/2014/03/05/russia-cant-afford-to-use-natural-gas-as-a-weapon/

Dicker: Ukraine Crisis Makes Noble Energy a Buy | TheStreet.com

Dicker: Ukraine Crisis Makes Noble Energy a Buy

NEW YORK (TheStreet) -- I was talking to Jim Cramer Wednesday about Ukrainian tensions and the grip the Russians hold on natural gas supplies, not only to the Ukrainian Republic but also to Europe itself. Two-thirds of all the natural gas that the European Union uses comes from Russia, and a majority of that gas runs through pipelines in Ukraine.

It is this deep reliance on the Russian energy supply that can be used to such great effect by Russia in reestablishing a favorable government in Kiev, but also gives the Europeans pause in trying to intervene on behalf of the new Ukrainian government.

The threat of a slowdown in Russian natural gas supply is an incentive used often on the EU, particularly recently when a massive cold snap held Europe in its grip late in 2012, and more recently in the EU bailout of Cypriot banks in the spring of 2013. When energy supplies are at stake, sometimes morality can take a back seat.

But there is a developing alternative source of energy on the horizon for Eastern Europe nations almost entirely reliant on Russia: the Leviathan field in the Mediterranean off of the coasts of Israel and Cyprus. Because this find has had a very slow development trajectory, the market has been equally slow to recognize the geopolitical importance of this find. Noble Energy (NBL_) is the dominant partner in the development of Leviathan.

The markets for Leviathan natural gas and oil could not be needier, and the crisis in Ukraine shows just how vulnerable Eastern Europe and specifically Turkey, Greece, Italy and other Mediterranean countries are. But with the value of Leviathan still slipping under the radar, shares of Noble remain unrewarded for this game changer.

It will not be a quick profit, but the continuing development of Leviathan will be a tremendous catalyst to Noble shares. The Ukraine crisis makes clear just how good a value Noble is right now.
I talk more about Noble and the Ukraine crisis with Jim in the video above.

At the time of publication the author had a position in NBL, as does Jim Cramer's charitable portfolio, Action Alerts PLUS.
 

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Stock quotes in this article: NBL 

Dan Dicker has been a floor trader at the New York Mercantile Exchange with more than 25 years of oil trading experience. He is a licensed commodities trade adviser. Dan is currently President of MercBloc LLC, a wealth management firm and is the author of "Oil's Endless Bid," published in March of 2011 by John Wiley and Sons.


Link to source: http://www.thestreet.com/story/12511904/1/dicker-ukraine-crisis-makes-noble-energy-a-buy.html