Parker Drilling (NYSE: PKD) has  announced the appointment on October 18, 2013 of Mr. Peter C. Wallace (photo) to the company's board of directors, increasing the board size from nine to ten. Mr. Wallace brings extensive senior leadership, product and business development, sales and marketing management, and operational experience at multinational companies operating in the oil and gas, power transmission, fluid management, and industrial manufacturing sectors. He will serve as a Class III member of the company's board of directors, with an initial term expiring at the annual meeting of stockholders to be held in 2014.  He will also serve on the board's compensation committee.

Mr. Wallace, age 59, most recently served as president and chief executive officer of Robbins & Myers, Inc., an international supplier of equipment and systems to the energy and chemicals sectors from 2004 to 2013, when the company was acquired by National Oilwell Varco. From 2001 to 2004, Mr. Wallace served as president and chief executive officer for IMI Norgren Group, a world leader in motion and fluid control technologies.  From 1998 to 2001, Mr. Wallace served as president and chief operating officer for Rexnord Corporation, a division of Invensys, plc. Prior to 1998, Mr. Wallace served in various management and senior leadership roles throughout his 25 year career with Rexnord Corporation, a leading company in the design, manufacturing, and servicing of highly engineered mechanical components used in numerous industries and end markets.

Mr. Wallace currently serves on the board of Applied Industrial Technologies, a leading North American distributor of industrial products and services. He also serves on the board of directors for Rogers Corporation, a technology leader in power electronics, advanced foams for cushioning and protective sealing, and high-frequency printed circuit materials, and is a member of that board's Compensation and Organization Committee and the chairman of its Nominating and Governance Committee.  Mr. Wallace holds an MBA from the University of Wisconsin and a Bachelor of Science in Mechanical Engineering from Cornell University.

"Peter's proven leadership along with his extensive background in industrial markets and quality assurance bring a unique and valuable perspective to the composition of our board," said Robert L. Parker Jr. chairman.  "His career spans a wide range of industries and includes years of experience in executive leadership positions for both publicly traded and privately held companies.  He is a seasoned industry professional with years of progressive growth and success that will serve our board well."

Upon his appointment, Mr. Wallace was granted 11,347 restricted stock units under the company's 2010 Long Term Incentive Plan, all of which will vest on the one-year anniversary date of the award. 

2H Offshore, an Acteon company, has appointed Pedro Viana and Roberto Alvim as the technical managers of its Rio de Janeiro, Brazil office to strengthen its management team and drive business growth.

Viana was the first engineer hired when 2H Offshore’s Brazil office opened in 2003. He has participated directly in the development of the office since its inception, and has supported both the technical and management activities of the company. Viana has experience in a range of conceptual, front-end-engineering design (FEED), detailed design and monitoring projects for many types of riser systems and complexities, and in different 2H Offshore offices around the world. His key project roles have included being the lead systems and lead analysis engineer for the Petrobras Guará–Lula NE buoyancy-supported riser project from early pre-FEED engineering studies through to the completion of the final detailed design.

Alvim joined 2H Offshore with six years’ experience in equipment design for the offshore industry. He graduated with a master’s degree in mechanical engineering from Pontifícia Universidade Católica do Rio de Janeiro in 2005. Alvim was the second engineer 2H Offshore hired in Brazil and, like Viana, has been an integral part of the growth of the Rio de Janeiro office. Alvim has worked on several analysis projects, including drilling, completion and production risers systems. For the past four years, he has managed a range of engineering projects, including FEED and conceptual studies for major oil and gas projects offshore Brazil.

Viana and Alvim will share responsibility for the management of the office with Pete Simpson, general manager. “I am delighted that Pedro and Roberto will be joining me as members of the 2H Brazil management team,” Simpson said. “They have shown their innovative engineering capabilities over the past 10 years and have contributed a great deal to 2H and its projects around the world. Their knowledge will provide support and an expert perspective for the engineering team here in Brazil.”

Through water communication and positioning technology company, Nautronix, is pleased to announce three new appointments within the sales team.

Bob Barrett, joins Nautronix as Sales Manager at the company’s global headquarters in Aberdeen.  He will be responsible for developing awareness and understanding of all Nautronix products including NASNet^® positioning technology. Prior to joining Nautronix, Bob gained his experience in sales through previous positions within the aerospace and Oil & Gas industry.

Nautronix has identified a skills gap in the Oil & Gas industry for good quality sales people.  Keen to address this, they have appointed Ashley Anderson and Scott Williams in the role of Sales Engineer and they will both embark on Nautronix’ sales training program.  Ashley is based in the company’s headquarters in Aberdeen and Scott is based in the company’s Houston office and both will supportthe efforts of the sales team.

Mark Patterson, CEO, comments, “Following a number of years of rapid growth we have recognised that we need to increase our sales efforts within Nautronix and it is vital we resource ourselves in key regions such as Aberdeen and Houston.  The Oil & Gas industry has a vibrant future ahead of it and it is a priority of Nautronix, to continue to attract young talent such as Ashley and Scott into the company and invest in their development through training and development schemes.  I am delighted to have Bob, Ashley and Scott on the sales team.” 

Fairmount Marine’s multipurpose vessel Fairmount Fuji has assisted Italian contractor Saipem with her operations offshore Congo. Fairmount Fuji has performed several cargo runs between Siapem’s Boscongo yard in Pointe Noire and the offshore Congo moored drilling ship Siapem 1000.

Fairmount Fuji also took care of the transport of Saipem crew.

Drilling ship Saipem 1000, a 5th generation drilling ship for ultra deepwater operations, was moored offshore Congo pending her next assignment. Fairmount Marine was contracted to assist in the crew change and in the transfer of cargo. Fairmount Fuji transported around 150 personnel to and from the ship.

Fairmount Fuji is equipped with a spacious 280 square meters deck.This makes her ideal for the transport of goods.

Fairmount Marine is a marine contractor for ocean towage and heavy lift transportation, headquartered in Rotterdam, the Netherlands. Fairmount’s fleet of tugs consists of five modern super tugsof 205 tons bollard pull each, especially designed for long distance towing, a multipurpose support vessel and a large submersible transport barge. Fairmount Marine is part of Louis Dreyfus Armateurs Group.

As fast-growing energy use in Southeast Asia leads to a sharp rise in the region’s dependence on oil imports and a reduction in its surplus of natural gas and coal for export, the International Energy Agency (IEA) has urged countries in the region to take serious action to improve energy efficiency.

“Southeast Asia is, along with China and India, shifting the center of gravity of the global energy system to Asia,” IEA Executive Director Maria van der Hoeven said at the launch of a World Energy Outlook Special Report, Southeast Asia Energy Outlook, which provides a comprehensive picture of the region’s energy future. Joining Ms. Van der Hoeven at the launch in Bangkok were Thai Minister of Energy H.E. Pongsak Ruktapongpisal and Hidetoshi Nishimura, Executive Director of the Economic Research Institute for ASEAN and East Asia.

The report projects Southeast Asia’s energy demand to increase by more than 80% in the period to 2035, a rise equivalent to current demand in Japan. Currently the region’s per-capita energy use is still very low, in part because 134 million people, or over one-fifth of the population, lack access to electricity.

Increasing reliance on oil imports will impose high costs on Southeast Asian economies and leave them more vulnerable to potential disruptions. The report projects that by 2035, the region’s oil imports will rise to just over 5 million barrels per day, making it the world’s fourth-largest oil importer after China, India and the European Union and doubling its dependency (to 75% of demand). Southeast Asia’s annual spending on oil imports is seen rising to $240 billion in 2035, equivalent to almost 4% of its GDP. Thailand’s and Indonesia’s oil import bills are projected to be the highest in the region, tripling to nearly $70 billion each in 2035.

According to the report, Southeast Asia will see a reduction in the surplus of natural gas and coal for export, as production is increasingly diverted to domestic markets. Its net gas exports are cut by more than three-quarters to 14 billion cubic meters in 2035. The region’s net coal exports also decline after 2020 as regional demand surges and demand in the wider Asia-Pacific market slackens. Indonesia’s coal production rises by almost 90% as it remains, by a very large margin, the world’s top exporter of steam coal.

The WEO Special Report highlights that the power sector is fundamental to the energy outlook for Southeast Asia, and that within it, coal is emerging as the fuel of choice because of its relative abundance and affordability in the region. Electricity generation is projected to increase by more than the current power output of India, with coal accounting for almost 60% of the growth. “The rising share of coal in power generation underscores the urgent need to deploy more efficient coal-fired power plants,” Ms. Van der Hoeven said. Currently the average efficiency of these facilities is very low, at just 34%, owing to the almost exclusive use of subcritical technologies.

Developing policies to attract investment is vital for enhancing energy security, affordability and sustainability in Southeast Asia. Around $1.7 trillion of investment in energy-supply infrastructure is required in the period to 2035. The report notes underdeveloped energy transport networks, the need for greater stability and consistency in the application of energy-related policies and subsidized energy prices as key challenges that must be overcome to mobilize this level of investment. The IEA noted the detrimental effects that fossil fuel subsidies have on energy markets, finding that in Southeast Asia they amounted to $51 billion in 2012.

The report includes an Efficient ASEAN Scenario that highlights the gains possible in Southeast Asia simply by adopting energy efficiency measures that make economic sense. Doing so would cut projected energy demand by almost 15% in 2035, an amount that exceeds Thailand’s current energy demand. Net oil imports would fall by around 700 kb/d, comparable with Malaysia’s current production. And regional GDP would rise by about 2% in 2035, as reduced spending on energy increases disposable income and stimulates economic activity.

To download the Southeast Asia Energy Outlook, please click here.

To see the slides presented at the report’s launch, please click here

PIRA Energy Group, a NYC-based energy markets consulting firm, reports that the U.S. is the world's largest producer of oil in 2013, according to data presented at PIRA's recent Retainer Client Seminarheld in New York City on October 10th and 11^th. 

U.S. total supply for 2013 is expected to average 12.1 MMB/D.  In 2012 the U.S. overtook Russia to become the second largest supplier of oil and was just behind Saudi Arabia.  Both the U.S. and Saudi Arabia increased their supply in 2013, though production in the U.S. grew at a faster pace.  U.S. total supply in 2013 is larger than that of Saudi Arabia by 0.3 MMB/D and ahead of Russia by 1.6 MMB/D.  The fourth through 10^th largest suppliers are: China, Canada, UAE, Iran, Iraq, Kuwait, and Mexico.

Total oil supply counts all forms of liquids supply.  The largest part is crude oil, including condensates.  In this category, the U.S. is expected to produce 7.4 MMB/D, which is less than that produced in Saudi Arabia and Russia by roughly 3 MMB/D each.  But the U.S. has substantial other forms of supply, including natural gas liquids (NGLs) at 2.5 MMB/D, biofuels at 1.0 MMB/D, and "refinery gain" at almost 1.3 MMB/D.  (Refinery gain measures the ability of a refinery to optimize its output through sophisticated high conversion capabilities.)

The U.S. has surged to be the world's lead oil supplier because of growth in shale oil.  Shale crude and condensate production at 2.5 MMB/D in 2013 is now slightly over one-third of total U.S. crude production, and shale NGL at 1.2 MMB/D is almost half of total NGLs.  Shale crude is seen growing by 0.8 MMB/D this year, while shale NGL grows 0.3 MMB/D versus 2012.  The U.S. shale liquids growth of 3.2 MMB/D over the last four years has been nearly unparalleled in the history of world oil; only Saudi Arabia in 1970-74 raised its production faster.

U.S. total supply growth in 2013 is seen at 1.0 MMB/D and about the same as last year's growth.  Its growth rate is greater than the sum of the growth of the next nine fastest growing countries combined and has covered most of the world's net demand growth over the past two years.

The U.S. position as the largest oil supplier in the world looks to be secure for many years.  Although growth rates of U.S. shale liquids are expected to become smaller in the future, PIRA's forecast sees the U.S. increasing the lead over the next two largest countries until after 2020 and retaining the lead to at least through 2030. 

For more information click here for additional informationon PIRA’s global energy commodity market research services.

 Huisman,a worldwide specialist in lifting, drilling and subsea solutions, has secured a new contract from Helix Energy Solutions Group, Inc. for the delivery of a Well Intervention System onboard Helix’s new build Semi submersible “Q7000”. The system, which is based on Huisman’s proven Multi Purpose Tower (MPT) design, will be built by the Huisman production facility in China.

The fully integrated 800mt Well Intervention System will be capable of handling the Intervention stack, the high pressure riser and other components. The Huisman Multi Purpose Tower has the same functionality as a normal derrick but offers improved accessibility to the well center, which allows for new improved handling procedures that increase efficiency and safety. The superior accessibility to the well center and the small footprint of the MPT are ideally suited for well intervention and subsea installation services. Subsea equipment can be skidded into the well center from three sides, offering enhanced flexibility.

The active heave compensation hoist system of the MPT provides excellent means for safe landing of equipment at the seabed while the passive heave compensation system provides a safe and redundant means to supply top tension to the risers. A guide trolley, travelling the entire length of the tower, guides the subsea modules during lifting operations. The system also features multiple transfer hatches that can be used to move equipment into the well center, and a skiddable work floor covering the moonpool flush with main deck.

The skiddable work floor allows large subsea modules to be deployed, without the need for a raised work floor. When large objects need to pass the moonpool the work floor can be skidded aside. In closed position, the work floor is flush with the main deck, which significantly reduces HSE risks and improves equipment handling on deck.

In addition to the Well Intervention System Huisman will also supply a 150mt Knuckle Boom Crane and a 160mt Pedestal Mounted Crane. Previous orders from Helix, amongst others, the Multi Purpose Tower onboard the “Q4000”, “Well Enhancer” as well as the cranes for the “Q4000” and “Q5000”.

Business Monitor has just released its latest findings on Nigeria’s volatile oil and gas sector in its newly-published Nigeria Oil and Gas Report.

The report notes that Nigeria's hydrocarbon sector continues to struggle amid a worsening political and business environment. Most recently, Chevron’s decision to move out of the OKLNG project signals that even the large upside potential of the Nigerian gas market is not sufficient to offset the degradation in investor sentiment. The weak output flows in 2012 were the consequence of flooding, repeated oil thefts and regulatory uncertainty. Business Monitor expects continued feeble production from 2013 and for the following two years. They note that output should ramp up more significantly as many large fields come online after 2014, more than offsetting current depletion. Adoption of the Petroleum Industry Bill, which they expect around Q413-Q114, would, Business Monitor believe, be a strong signal for investors that Nigeria's hydrocarbons sector is ready to move forward.
 

The main trends and developments Business Monitor highlight for Nigeria's oil & gas sector are as follows:
 

■ China agreed on a US$1.1bn loan deal with Nigeria bearing a very advantageous interest rate. In

exchange, the West African country will allow the lender to get a privileged access to natural resources

including oil. Business Monitor expect that, as such, further deals could be an occasion for Nigeria to revive its oil and gas sector by boosting export potential for producers.


■ Chevron decided to withdraw from the OKLNG project following the path Shell adopted last year. This brings another blow to Nigeria's gas market limiting further upside potential for liquefied natural gas (LNG) exports. The report notes, however, that the soon-to-open Escravos GTL plant could help monetise part of the gas currently flared.


■ Disturbances and outages due to oil thieves are continuing throughout 2013, with Shell having declared force majeure on Bonny Light exports several times since the beginning of the year. Business Monitor therefore forecast that 2013 production will be slightly lower than 2012 estimates, reaching 2.50mn barrels per day (b/d).


■ Business Monitor expects oil production to increase from an estimated 2.5mn b/d in 2012 to 2.70mn b/d by 2020, as ambitious projects such as Usan (180,000b/d) peak and Egina (150,000-200,000b/d) come on stream in the coming years.


■ Consumption of crude is forecast to rise at a compound annual rate of 7% year-on-year between 2012 and

2022, boosted by anticipated strong GDP growth. Business Monitor forecast consumption rising from an estimated

252,000b/d in 2012 to 495,000b/d by 2022.
 

■ Business Monitor forecasts gas production increasing from an estimated 36.4bn cubic metres (bcm) in 2012 to

56.2bcm by 2022, as the authorities and companies reduce the practice of flaring and start monetising associated gas resources.
 

■ Booming demand from the government's ambitious power sector plans and large export engagements will thus bolster production growth. The report sees Nigerian gas consumption rising from an estimated 5.8bcm in 2012 to 15.0bcm by 2022.
 

■ Nigeria National Petroleum Cooperation (NNPC) is aiming to more than double its annual production of LNG, from 22mn tonnes per annum (tpa), or 30.36bcm, to over 52mn tpa (71.76bcm). This was announced on September 19 2012, at a forum of LNG producers and consumers held in Japan. Group Nigeria managing director of NNPC, Andrew Yakubu, gave no deadline as to when this target would be met, but he did clarify that new LNG projects in Nigeria will help the company meet this goal.
 

■ In October 2012 Nigeria's Petroleum Minister, Diezani Allison-Madueke, announced that the government is planning to direct more than US$1.6bn towards the repair of three of its refineries. The maintenance work started in late 2012 and is due for completion in October 2014. The three refineries are located in Port Harcourt, Warri and Kaduna. The Port Harcourt refinery is currently halted indefinitely, as oil thieves damaged the feeding pipeline in early 2013.

Business Monitor is a leading, independent provider of proprietary data, analysis, ratings, rankings and forecasts covering 195 countries and 24 industry sectors. It offers a comprehensive range of products and services designed to help senior executives, analysts and researchers assess and better manage operating risks, and exploit business opportunities.

Keep up-to-date with Business Monitor's latest Oil & Gas insights here

Construction of the Keystone Gulf Coast Pipeline (KGCP) has advanced considerably, according to Genscape’s most recent flyovers on September 29^th and October 6^th. Genscape uses proprietary monitoring technology and aerial photography to monitor market moving pipeline flow disruptions and infrastructure projects to offer market participants a real-time look at the factors driving the U.S. and Canadian oil markets.

On October 2^nd TransCanada stated that major construction would be complete by the end of October and that the pipe would be ready for line filling shortly thereafter. Genscape is now monitoring power consumption at the Lufkin and Delta pumping stations and will be able to detect the power consumption to these pumping stations indicative of line fill activity. Delta is not expected to be necessary for the initial start-up capacity. Genscape’s analysts’ believe that late December to early January is a realistic estimate for the completion of the line fill, based on acceleration in construction progress from last month's flight. The bulk of work remaining on the project is centered on the origin Cushing pumping station.

At the Cushing terminal, all seven newly constructed tanks have hydrotested. Mixer installation appears complete, while tank pipeline connections require further work. Genscape believes that the associated connections are not necessary for initial KGCP fill, and that the tanks could potentially be bypassed. The terminal will have 2.25mn bbls of storage capacity.

Additionally, exposed pipe was observed near the Tupelo and Bryan facilities and crews were observed working on pipeline connectivity along the ROW at the Tupelo pumping station. The Cromwell, Bryan, Winnsboro, Lufkin and Liberty pumping stations each have four pumps installed. Hydrostatic testing looks to be complete at all pumping facilities except for the Bryan pumping station. After successful hydrostatic testing, final grading would take place at each pumping facility followed by the installation of a security fence, according to a TransCanada document. The Bryan pumping facility did not have a security fence installed as of Gencscape’s latest flight. The Tupelo, Delta, Lake Tyler and Corrigan stations do not have pumps installed at this time. Genscape believes these stations do not need pumps for the line to flow at its initial stated capacity of 700,000 bpd.

The 36-inch-diameter KGCP will flow 485 miles from Cushing, OK, to Nederland, TX. The line will have an initial capacity of 700,000 bpd with the option to expand to 830,000 bpd. Line fill for KGCP is approximately 3.2mn bbls. Genscape estimates it will take approximately 40-60 days to fill the line at near 54-81,000 bpd fill rate. The Keystone pipeline from Hardisty, AB, to Patoka, IL, took nearly 180 days to fill in 2010 at near 50,000 bpd fill rate. Line fill for Keystone to Patoka was approximately 9.2mn bbls. TransCanada estimated the line fill duration would be approximately 30 days. Sunoco Logistics Partners LP’s Nederland terminal will be the initial terminus of the KGCP pipeline, according to a Reuters report. Valero’s Lucas storage terminal would also receive crude from the line in Q1 2014 according to a September SEC filing.

TransCanada stated construction on the Houston lateral was slated to begin Q4 2013 and is estimated to be in service by Q4 2014. The lateral will be approximately 48 miles from the Liberty pumping station to Houston’s refining center. Click here to view the aerial photos that supplement this report.

Genscape’s Mid-Continent Pipeline clients receive ongoing notices of pipeline flows and infrastructure projects in advance of market reports. A free trial of the Mid-Continent Pipeline service, and all Genscape’s oil market services, is available by visiting info.genscape.com/keystone-october.

OPEC output dropped sharply in September, but non-OPEC supply growth is expected to approach record high in 2014

Global oil supplies declined by 625 000 barrels per day (650 kb/d) in September,  to 91.12 million barrels per day (mb/d), on steeply lower OPEC output, the IEA Oil Market Report for October told subscribers. But non‐OPEC supply growth for 2013 is forecast to average 1.1 mb/d, to 54.7 mb/d, rising to a near‐record 1.7 mb/d next year.

OPEC crude supplies slipped below 30 mb/d for the first time in almost two years, led by steep drops in Libya and Iraq. Output fell by 645 kb/d, to 29.99 mb/d, despite Saudi output exceeding 10 mb/d for a third month running. The "call on OPEC crude and stock change" was raised by 100 kb/d, to 29.6 mb/d, for the current quarter.

Recent demand strength has raised the 2013 forecast by 90 kb/d, to 91.0 mb/d. Demand growth for 2013 is projected at 1.0 mb/d (or 1.1%), ramping up to 1.1 mb/d in 2014 as the macroeconomic backdrop improves.

The Oil Market Report (OMR) is a monthly International Energy Agency publication which provides a view of the state of the international oil market and projections for oil supply and demand 12-18 months ahead. To subscribe, click here.

Noble Energy, Inc. (NYSE: NBL) announces that the A-2 appraisal well drilled on the Block 12 discovery offshore the Republic of Cyprus has successfully encountered approximately 120 feet of net natural gas pay within the targeted Miocene-aged sand intervals.  The Cyprus A-2 well, which is more than four miles northeast of the A-1 discovery location, was drilled to a total depth of 18,865 feet in 5,575 feet of water.

Production testing procedures were performed over a 39-foot section of the upper Miocene reservoir.  The test, limited by surface equipment, yielded a maximum flow rate of 56 million cubic feet per day (Mmcf/d) of natural gas.  Performance modeling indicates development wells in the reservoir should have capacity to deliver up to 250 Mmcf/d.  Evaluation of drilling data, wireline logs and reservoir performance information has resulted in an updated estimate of gross resources of the field ranging⁽¹⁾ from 3.6 trillion cubic feet (Tcf) of natural gas to 6 Tcf, with a mean of approximately 5 Tcf.  The Cyprus A structure represents the third largest field discovered to date within the Deepwater Levant Basin.

Keith Elliott, Noble Energy's Senior Vice President, Eastern Mediterranean, commented, "Results from the Cyprus A-2 well have confirmed substantial recoverable natural gas resources and high reservoir deliverability.  While the A-2 location has successfully defined the northern area of the discovery, we anticipate additional appraisal activities are necessary to further refine the ultimate recoverable resources and optimize field development planning.  In the meantime, we continue to identify and advance multiple development options.  In addition to the Cyprus A discovery, we are also encouraged about the further exploration potential in Block 12.  We have recently completed a 1,100 square mile 3D seismic acquisition, which will be interpreted over the next several months." 

Noble Energy operates Block 12 offshore the Republic of Cyprus with a 70 percent working interest.  Delek Drilling and Avner Oil Exploration each have 15 percent working interest. 

Noble Energy plans to move the Ensco 5006 drilling rig to Tamar SW, offshore Israel, at the completion of operations offshore Cyprus.  The Tamar SW well, testing an exploration prospect offsetting the main Tamar field, is expected to reach total depth by the end of 2013.  Noble Energy operates Tamar SW with a 36 percent working interest.   

(1)  Range of resource estimate based on 75^th and 25^th percentile probabilities

TransMontaigne Partners L.P. (NYSE:TLP) has announced commercial operations are underway for phase one at the 185-acre Battleground Oil Specialty Terminal Company, LLC (BOSTCO) on the Houston Ship Channel. Approximately 20 of the 51 storage tanks being built during phase one construction are being placed into service this month, and the remaining tanks will come online during the next six months. A two-berth ship dock and 12 barge berths are also scheduled to be in service this month.



A joint venture of TLP (which owns a 42.5 percent interest in the facility) and Kinder Morgan Energy Partners, L.P. (NYSE: KMP), the approximately $485 million BOSTCO oil terminal at mile marker 43 on the Houston Ship Channel is fully subscribed for a total capacity of 7.1 million barrels and is able to handle ultra low sulfur diesel, residual fuels and other black oil terminal services.


Phase two of construction at BOSTCO is underway and involves the construction of an additional six, 150,000-barrel, ultra low sulfur diesel tanks, additional pipeline connectivity and high-speed loading at a rate of 25,000 barrels per hour. BOSTCO expects phase two to begin service in the fourth quarter of 2014.



"We are pleased to announce the commencement of operations of the BOSTCO facility, which provides the market with a unique, deepwater terminaling solution that provides high speed loading and improved barge and ship access to the Texas Gulf Coast for the export and import of various refined products," said Charles Dunlap, Chief Executive Officer of TLP’s general partner.



The BOSTCO project is employing approximately 750 local contractors during construction and has hired about 75 full-time employees to operate the facility.



With Brazil’s  first exclusive pre-salt bidding round underway this month for a single block containing the Libra field, and massive potential identified within the country’s offshore pre-salt layer, bidding between several consortia is expected to push the state’s  take significantly higher than that which would result from a Concession Contract, says research and consulting firm GlobalData.

According to the company’s latest report*, Brazilian authorities consider the exploratory risk in pre-salt areas to be relatively low, and legislation was passed to govern upstream oil and gas activities within an area designated as the pre-salt polygon using Production Sharing Contracts (PSCs), instead of the traditional Concession Contract regime.

This form of contract ensures a higher government take from production projects and is being offered in the first bidding round for Libra, which is estimated to hold reserves of between eight and 10 bbl (billion barrels). State take from this and other fields within the area is now expected to be near 75%, which would represent a base state profit oil share of around 50%.

As well as the government receiving a share of production, higher royalties equal to the value of 15% of gross oil and tax production are payable, compared to a maximum of 10% under Concession Contracts. Meanwhile, a signature bonus for Libra, set at BRL15 ($6.3 billion), is also payable, but the Special Participation tax is not applicable.

Adrian Lara, GlobalData’s  Lead Analyst covering Upstream Oil & Gas, says: “While the effective production-sharing terms for the Libra block will not be known until the conclusion of the first pre-salt bidding round, the nature and caliber of companies taking part suggests to us that the competition will occur between three or four bidding consortia, despite the conspicuous absence of US oil giants.

However, beyond the initial pre-salt licensing rounds and into the medium-term, we are expecting further pre-salt licensing to progress at a relatively slow pace, with blocks only being offered once discoveries or prospects have been identified by Petrobras, Lara continues. “By clearly identifying potential before offering acreage, the risk for prospective investors will be lowered and the state will be able to secure a higher stake.”

In addition to the pre-salt bidding round taking place this month, November will also see the start of Brazil’s 12th Concession round, which will offer blocks in frontier and mature onshore basins. While some of these are estimated to hold significant shale gas potential, no major amendments have been made to the fiscal terms governing this round.

*Brazil Upstream Fiscal and Regulatory Report

For the second year running Petrobras CEO, Maria das Graças Silva Foster, is ranked by the American magazine Fortune the most powerful female executive in the world, among an international list of business women from various industries. Graça Foster has topped the listings for female executives outside the United States.



To prepare the global ranking of the Most Powerful Women in Business, Fortune selected a group of 50 candidates from various countries, such as England, Australia, Sweden, and Turkey. The listing is based on four criteria: the size and importance of the business in the global economy, the success and management of the business, the executive's career trajectory and her social and cultural influence.



Maria das Graças Silva Foster qualified as a chemical engineer and was first woman to be appointed to head Petrobras, taking the helm in February 2012. Prior to that, she was the director of the Gas & Energy division and CEO of Petrobras Distribuidora, and had already held several other executive positions. Graça Foster has been on the company's staff of career professionals for 32 years.

To view the Fortune International Power 50, the list of the Most Powerful Women in Business outside the US, click here http://money.cnn.com/magazines/fortune/most-powerful-women/2013/global/


Awards - In addition to topping the Fortune listing, in August this year Graça Foster was named Best CEO in the Latin American Oil, Gas and Petrochemicals Industry by Institutional Investor magazine . In May, she was listed by Forbes Magazine as the most powerful women in Brazilian business and one of the top 20 most powerful women in the world . In April, she appeared on Foreign Policy magazine's FP Power Map, listing the 500 most powerful people in the world. 

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A decline in production among Malaysia’s shallow-water reserves has prompted the country to shift its focus towards new development opportunities in deepwater areas and marginal fields. However, incentives designed to attract investors have only recently been introduced, indicating that further fiscal changes are unlikely to come soon, according to research and consulting firm GlobalData. 

The company’s latest report* states that as most of Malaysia’s oil production has historically come from shallow-water areas, the government has been pushed to introduce a number of tax incentives this year to help improve the attractiveness of the country’s fiscal terms and promote further development activity.

Under Production Sharing Contracts (PSCs), marginal fields – defined by reserves of up to 30 million barrels of oil, or 500 billion cubic feet of natural gas – are subject only to petroleum income tax at a rate of 25% instead of the usual rate of 35%.

Meanwhile, under Risk Service Contracts (RSCs), which are also offered for marginal fields, contractors only pay a corporate income tax of 25%, rather than the petroleum income tax.

GlobalData believes that the additional investment allowance introduced by recent legislation should prove to be a significant improvement to Malaysia’s fiscal regime.

Jonathan Lacouture, GlobalData’s Lead Analyst for the Asia-Pacific region, says: “Numerous measures have been involved in the government’s drive to increase production from its marginal fields. Since the introduction of RSCs in 2011, there have been two forms of contract into which investors may enter, and this, combined with reductions in the tax liability afforded to marginal fields under 2013 legislation for PSCs, should increase the attractiveness of investment opportunities.”

However, due to these recent changes to Malaysia’s fiscal terms, it is expected that any further alterations will be unlikely over the next few years.

If the terms do not achieve their desired investment amounts in the medium to long term, the government may decide to make additional changes, but this will depend on short to medium-term results. It is most probable that terms will remain stable until the effects of these recent policies can be assessed,concludes Lacouture.

*Malaysia Upstream Fiscal and Regulatory Report

By Steven Kopits, Douglas-Westwood, New York

Alaskan oil production peaked in 1988 at around 2 million bpd and has been falling since, possibly down to 510kbpd this year. Virtually all of this production flows through the 800 mile Trans-Alaska Pipeline (TAPS), to Valdez, in southern Alaska. But TAPS is struggling, operating below a quarter of its capacity, with fears that it will lose its viability below 300kbpd.

In the wake of the run-up in oil prices before the recession, then governor Sarah Palin brought in a 75% tax rate from 2007. This stalled investment and production decline rates increased to nearly 7% from 4% a decade earlier. Alarmed by this, the current governor, Sean Parnell reduced the top tax rate to 35%. This brought promises of investment by BP and ConocoPhillips. However, expectations remain modest, at best to reduce declines to 20kbpd / year from the current 40kbpd pace. If expectations are met, TAPS will reach the 300kbpd threshold in 2024, rather than 2020. Many Alaskans are unimpressed and are forcing a referendum to re-instate the higher tax rates – they see the end of the state’s golden age of oil and want to get all they can, while they can.

On the other hand, Shell has big plans, as much as 1.8 mbpd from Alaska’s Outer Continental Shelf, 40% more than Gulf of Mexico production today. But cost to first oil is in the $40-60 bn range, and one has to wonder whether Shell has the fortitude to hold out until initial production in 2025. Indeed, Goldman Sachs spent much of a recent report berating Shell for “overspending in low return assets and unproductive capital”. Shell’s incoming CEO, Ben van Beurden, comes from the chemicals division, where he managed to increase profitability and lower Capex. Will a downstream manager feel the exotic lure of Alaska as much as the upstream team has? Or will he decide that 2025 is just too long for investors who are looking for cash quarter by quarter? Alaskans have good cause to feel nervous.