Showing posts with label Qatar. Show all posts
Showing posts with label Qatar. Show all posts

Wednesday, December 14, 2011

On OPEC chatter & Libyans who matter!

Credible information and several statements made on arrival in Vienna by OPEC ministers and member nations’ delegates suggest that price hawks – chiefly Iran – will now accept an 'official' rise in production quota by Saudi Arabia and its allies Kuwait and Qatar.

That would mean the cartel would now legitimise and accept a stated production cap of 30 million barrels per day (bpd) for all members after talks on the issue fell apart in June and OPEC ministers left in a huff without formally outlining the output cap.

Saudi Oil Minister Ali al-Naimi has already been flexing his ‘crude’ muscles. If, as expected, an OPEC agreement puts a 30 million bpd production cap on all 12 OPEC member nations, this would keep the cartel’s production in the region of a 3-year high. The stated volume would meet demand and leave enough surpluses to rebuild lean stocks by 650,000 bpd over the period according to OPEC.

Sucden Financial Research’s Jack Pollard notes that an OPEC production ceiling could provide some upside support if approved; Saudi opposition could suppress calls from Iran. The return of Libyan and Iraqi crude oil should alleviate the market’s tight supply conditions.

“As we come to the year-end, the contrasting tail risks in Europe and the Middle-East seem most likely to dominate sentiment. Increased sanctions on Iran which could cut production by 25%, according to the IEA, could mitigate the worst of the losses if the situation in Europe deteriorates,” he concludes.

Assurances are also being sought here to make room for Libya's supply coming back onstream so that collective production does not exceed 30 million bpd as ministerial delegations from Algeria, Kuwait, Nigeria and the OPEC secretariat met here today, ahead of tomorrow’s proceedings.

Most OPEC producers would be comfortable with an oil price of US$80 per barrel or above, while the Venezuelan and Iranian position of coveting a US$100-plus price is well known. Kuwait Oil Minister Mohammad al-Busairi told reporters, “The market is balanced, there is no shortage and there is no oversupply. We hope there will be an agreement that protects global economic growth.”

As talk of Libyan production coming back onstream gains steam here at OPEC, the Oilholic thinks the key figures on the Libyan side instrumental in bringing that about could or rather would be Abdel Rahim al-Keib (a key politician), Rafik al-Nayed (of Libya’s investment authority) and Abdurahman Benyezza (Minister of Oil and Gas). International companies BP, Eni, Occidental Petroleum, OMV and Repsol will figure too with operations in the country. That’s all for the moment folks! Keep reading, keep it ‘crude’!

© Gaurav Sharma 2011. Photo: 160th OPEC press conference table © Gaurav Sharma 2011.

Thursday, December 08, 2011

Oilholic at Qatar Petroleum’s Dukhan field

On the final day of the 20th WPC, the Oilholic skipped the morning’s proceedings and headed to Dukhan oil & gas field nearly 60 km west of Doha at the invitation of Qatar Petroleum. This field is where it all began for Qatar’s oil & gas industry when oil was first discovered in 1938 and one is privileged to have been granted access to such a historic site.

Not only was access allowed, but Qatar Petroleum’s site supervisor Abdulla Mohamed Afifa spared his valuable time to both answer the Oilholic’s questions as well as accompany him around parts of the field and its gas recycling facility.

Oil was first discovered in Dukhan in 1938 at the very site this blogger stands sporting a Qatar Petroleum uniform and overalls (see left). While prospection fields were dug over 1939 and 1940, the first meaningful export of petroleum from Dukhan had to wait until after World War II in 1949.

The field contains four reservoirs – Fahahil, Khatiyah and Jaleha/Diyab. Oil & gas are separated in Qatar Petroleum’s four degassing stations – namely Khatiyah North, Khatiyah Main, Fahahil Main and Jaleha. Stabilised crude is then transported by pipeline to the Mesaieed port.

A massive turnaround came in 1959 when natural gas was discovered in the Khuff Reservoir. The discovery at Khuff and what followed has since made the state of Qatar one of the biggest exporters of natural gas.

The Fahahil plant was commissioned to recover raw natural gas liquids (NGL) in 1974. Two years later, the first development well at Khuff reservoir was dug, and between 1978 and 1982 eight wellhead treatment plants were commissioned at Khuff alone.

Several production stabilisation techniques have been employed in the last decade making Qatar Petroleum the world’s six largest oil company by barrels of oil equivalent at the time of writing this post. These days the field produces up to 336,000 barrels of crude/crude oil equivalent per day with future plans such as Dukhan Gas Lift project aimed at maintaining crude oil production.

The adjoining Dukhan city, which began life as a mere camp for Qatar Petroleum employees, is today a vibrant city boasting its own amenities, facilities, a service sector economy and not to mention a pristine beach. It is connected to Doha by Qatar's only four-lane motorway along which the Oilholic zipped down to see this site. Visiting Dukhan was a memorable experience much enriched by site supervisor Afifa’s insight about the field.

© Gaurav Sharma 2011. Photo I: The Oilholic at the site of the first discovery of oil in Qatar - the Dukhan field. Photo II: A well at Dukhan field, Qatar © Gaurav Sharma 2011. Photo III: Oil Rig No 54, Gas separator valves in foreground, Dukhan, Qatar, Archive July 1956 © Qatar Petroleum.

Wednesday, December 07, 2011

Oilholic’s photo clicks @ the 20th WPC venue

The Oilholic is by no means a photojournalist, but there is no harm in pretending to be one armed with a fully automatic Olympus FE-4020 digital camera at such an impressive venue as the Qatar National Convention Centre (QNCC) which was opened to the public for the first time for the 20th World Petroleum Congress when things began here on December 4th.

According to a QNCC spokesperson, the “sheer size (of the building pictured above left), sensational spaces spread over three levels and high-tech solutions have set new standards when it comes to hosting an event as prestigious as the Petroleum Congress.

One supposes that you can brag a little when your venue has 40,000 sq. metres of exhibition space, a conference hall facility for 4,000 delegates, 2,300-seat lyric style theatre, three additional smaller-tiered auditoriums all complete with theatre-style seating, banquet space for up to 10,000 in exhibition halls, 52 meeting rooms, ample space for pre-function logistics, exhibition foyers, lounges, hospitality suites, business centers and more importantly for fellow scribes - impressive media rooms! Phew!

Hope you enjoy the virtual views, as the Oilholic is enjoying them here on the ground.
QNCC entrance lobby
QNCC Interior: lobby level I
QNCC Exhibition floor
QNCC Exhibition floor
Total CEO Christophe de Margerie at QNCC Theatre Hall
© Gaurav Sharma 2011. Photos from the 20th World Petroleum Congress being held at the Qatar National Convention Centre, Doha, Qatar © Gaurav Sharma, Dec 2011.

Monday, December 05, 2011

An intensely ‘crude’ few days @WPC

In keeping with the intensity of World Petroleum Congresses of the past, the Oilholic’s first two days here have been – well – intense. The 20th WPC opened with customary aplomb on Dec 4th with an opening ceremony where feeding 5,000 delegates was a bit slow but the Qatari Philharmonic Orchestra tried its best to perk things up and make up for it.

When things began in earnest on Dec 5th – the Oilholic was spoiled for choice on what to and not to blog about and finding the time for it. Beginning with our hosts, in his inaugural address to Congress, Sheikh Hamad Bin Khalifa Al-Thani, Emir of the State of Qatar highlighted that the event was being held in the Middle East for the first time; a wrong has been right – after all the region exports bulk of the world’s oil.

Welcoming and thanking aside, the Emir made a very important point about why cooperation here among crude importers and exporters is really necessary now more than ever.

“The growing needs for oil and gas requires enormous investments by the exporting countries. The financing of these investments and securing their profitability require the most accurate information possible about the factors affecting the global demand for oil & gas to reduce the degree of risk that these investments may be subjected to,” he said.

“It is not reasonable to ask the Exporting Countries to meet the future needs for these two commodities while at the same time the consumer countries carryout unilateral activities that augment the risks facing these investments,” the Emir concludes. Well said sir – consumers need to get their act together too.

Three of the biggest consumers are here in full force, i.e. the US, Indian and Chinese delegations; the size of latter’s delegation rivals even the Qatari participation. Completing the BRICs – Brazil and Russia are here seeking partners. Lukoil is looking to expand via investments while Rosneft is seeking a greater interaction with Norway’s Statoil. Brazilian behemoth Petrobras has been flagging its wares including details about the presence of oil at a prospection well (4-BRSA-994-RJS), located in Campos Basin, in the area known as Marlin Complex.

The well, commonly known as Tucura, lies between the production fields of Voador and Marlim, at a water depth of 523 meters. Located 98 km from the shore of Rio de Janeiro State, the well is 3km from Marlin's Field and 2.3 km from the P-20 platform. The discovery was confirmed by sampling in post-salt rock in a reservoir located at a water depth of 2,694 meters.

It follows Petrobras’ confirmation on Nov. 23 about the presence of a good quality oil in well (4-BRSA-1002-SPS), in south Santos Basin, in an area known as Tiro and Sidon. Petrobras CEO José Sergio Gabrielli de Azevedo is busy outlining future plans and the company's activities in Brazil and in the world.

It seems the Brazilian major intends to invest US$225 billion between 2011 and 2015 with almost 60% of this going towards exploration and production projects.

Gabrielli highlighted Brazil as one of the largest and fastest growing markets in the world in terms of oil consumption. By way of comparison, Brazil's annual oil consumption in 2010 was up 2.1%, in contrast to a decline of 0.04% in OECD countries for the same period.

More later; keep reading, keep it crude!

© Gaurav Sharma 2011. Photo: 20th World Petroleum Congress Opening Ceremony & Dinner, Dec 4th, 2011 © Gaurav Sharma 2011.

Sunday, December 04, 2011

Hello Doha! Time for kick-off at 20th WPC

The Oilholic arrived in Doha late last night before the biggest bash in the oil & gas business kicks-off in Qatar – yup its 20th World Petroleum Congress! Sadly a very late arrival at the hotel meant, the first square meal was not a local delicacy – but a visit to Dunkin’ Donuts which was just about the only place open at 12:20 am local time. Still there’ll be plenty of opportunities to savour local delights over the next five days!

As the opening ceremony takes place later this evening, there is lots to discuss already following Shell’s announcement about its withdrawal from the Syrian market in wake of EU sanctions. Other oil companies are simply bound to follow suit. Syrian officials are expected to be in attendance but it is highly doubtful that the Oilholic would gain an attendance with them.

A few more bits before things get going, one hears that Fitch Ratings expects the credit profiles of the European oil majors to remain stable in 2012 despite the risk of a possible slowdown in revenue growth combined with still ambitious investment spending programmes of around US$90 billion over the following four quarters. The agency believes sector revenue growth in 2012 will probably slow to single digits from more than 20% in 2011, according to a new research note.

The Oilholic also had the pleasure of interviewing Eduardo de Cerqueira Leite, the chairman of (currently) the world’s largest law firm by revenue – Baker & McKenzie – on behalf of Infrastructure Journal. Leite does not believe the integrated model of combining upstream, downstream and midstream businesses is dead as far as major oil companies are concerned.

“We saw Marathon Oil Corp split off its refining business and know that ConocoPhillips is planning to do the same. By spinning off R&M infrastructure assets a company can focus on producing oil and gas, particularly in the more innovative areas of offshore oil exploration and unconventional oil and gas production,” he said.

“However, we are not seeing all of the majors spin off their R&M divisions. Many still have a need for refining expertise and processing plants due to the increasing development of liquefied natural gas, natural gas liquids and high-sulphur heavy crudes. So, I wouldn't call the integrated model dead, although we are seeing changes to it,” Leite concludes.

That’s it for now. Keep reading, keep it 'crude'!

© Gaurav Sharma 2011. Photo: Doha Skyline © WPC. Logo: 20th World Petroleum Congress © WPC.