TPT September 2008

Oil & Gas News

country in OPEC after Saudi Arabia, contributes some four million barrels of oil to daily worldwide production of close to 87 million barrels. While Iran has been at odds with Western nations, notably the US, over its nuclear ambitions, President George W Bush recently somewhat softened his attitude toward diplomatic engagement with Iran while the nuclear impasse persists. This would appear to be a prudent tactic. “We really cannot replace Iran’s production,” Abdalla Salem el-Badri, the secretary general of OPEC, said on 10 July at the group’s headquarters in Vienna. “It’s not feasible to replace it.” ■ A factor in the current squeeze on the world’s oil supply is the global shortage of ships fitted for use in deepwater offshore drilling. Drill-ships are booked solid for the next five years, and the scarcity of the vessels is hampering the ability of energy companies to develop known reserves or find new ones. While the situation will get worse before it gets better, it has prompted a wave of drill-ship construction that will likely lead over time to renewed offshore oil exploration. Shipyards from South Korea to Norway are working overtime to meet the intensified demand, and some 16 new drill-ships are scheduled for delivery to oil companies in 2008: more than double the total delivered over the previous six years. ODS-Petrodata, which provides market and analysis tools to the upstream oil and gas industry, reported that 75 ultra-deepwater rigs should be delivered from 2008 to 2011. ■ China Oilfield Services, a unit of China’s top offshore oil and gas producer CNOOC, has agreed to buy a Norwegian rival, Awilco Offshore, for about $2.5 billion. The purchase expands China Oilfield’s overseas operations, which accounted for 18 per cent of the state-run company’s revenue last year. The deal also allows China’s largest offshore oil services group to raise the number of its drilling rigs from 15 to 22 and thereby increase its exploration capability. As reported by Reuters, China Oilfield’s chief financial officer, Zhong Hua, said 7 July that the Awilco deal would help it to enter the high-end North Sea drilling market and further consolidate its position in Southeast Asia. The company will also pursue more acquisitions. “Our aim is to become an international oil field services company with strong competence in global markets by 2010,” Mr Zhong told reporters. “That cannot be achieved just by organic growth.” ■ The Spanish-Argentine oil company Repsol YPF SA has confirmed it is negotiating to buy a ‘significant’ stake in one of the Russian Sakhalin Island oil and gas fields. As reported in the Oil & Gas Journal (July 15), Repsol officials did not disclose which of the Sakhalin fields attracted their interest or how big a stake they may take. However, other sources indicated Repsol is seeking 25 per cent of the Sakhalin III project from OAO Rosneft. Rosneft holds a 74.9 per cent stake in that project, with the remaining 25.1 per cent held by China Petroleum and Chemical Corp (Sinopec). ■ The French government on July 18 issued a decree allowing for the privatization of Gaz de France, enabling it to merge with the Paris-based multinational Suez for the formation of one of the largest utilities in the world. Suez has operations in water and electricity as well as natural gas supply. The new law allows for

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S eptember 2008

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