TPT September 2008

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Oil & Gas News
› 161 September 2008
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