Home' Trinidad and Tobago Guardian : May 7th 2015 Contents MAY 2015 • WEEK ONE www.guardian.co.tt BUSINESS GUARDIAN
ENERGY BRIEFS | BG9
Shell pushes on with
arctic exploration as it
awaits US permit
Royal Dutch Shell is pushing ahead with
plans to explore for oil in the Arctic Ocean
near Alaska this summer despite opposition
from environmental groups.
The Anglo-Dutch oil major is preparing "an
armada of 25 vessels" to begin a two-year
programme to explore two to three wells in
the Chukchi Sea off the coast of Alaska, Chief
Financial Officer Simon Henry said on Thurs-
"We are currently on track. Some of the
permits are issued at the last moment," he
Although Shell had to pull out of the region
in 2012 after an oil rig ran aground, the Arctic
oil reserve "remains a massive value oppor-
tunity," Simon said.
Shell has submitted plans to explore the
Arctic to the US Interior Department after the
Obama administration last month upheld a
2008 Arctic lease sale, clearing an important
hurdle for Shell.
The Department of the Interior will now
consider the company's drilling plan, which
could take 30 days.
Shell has lined up the necessary equipment
and vessels to deal with any mishaps, which
Henry said are of a "very low probability."
Environmental organisations fear that an
oil spill would be destructive for an ecologically
sensitive region and extremely hard to clean
up in a remote area with rough and frigid seas.
New subsea integrity firm
launched at OTC 2015
A new subsea integrity technology business
was launched on Monday at Houston's Off-
shore Technology Conference (OTC). The
company---Underwater Integrity Solutions---
will focus on underwater integrity, product
assurance and life extension for subsea fields.
Houston-based UIS will receive US$150
million of equity from European private equity
oil and gas investor HitecVision to finance the
initial growth phase of the company.
UIS has been founded by five subsea industry
veterans, who have a combined 140 years'
experience in the sector.
They intend that the firm acquires other
businesses and forms strategic partnerships
in order to build an independent and global
company that is focused solely on helping to
maximise oil and gas operators' financial return
on their subsea assets.
UIS CEO Bill Boyle commented in a com-
"UIS is launching at a time when the trend
for operations in deeper water and in more
hostile environments is continuing. There are
about 5,000 operational subsea wells around
the world with almost 7,000 predicted by
2020. Subsea global annual operating expen-
diture is currently around $10 billion and
expected to grow strongly over the course of
the next few years.
"Today, there is a need to significantly reduce
subsea operating costs and increase efficiency
and hence value from subsea fields. Against
that background, the UIS vision is to become
a leading provider of independent underwater
integrity and production assurance solutions.
Our independence, global presence and sole
focus on subsea integrity and assurance will
be our competitive edge, differentiating UIS
from what is currently being offered in the
UIS will operate on both sides of the Atlantic.
Along with Bill Boyle, CFO Mark Webster and
chief operating officer Guido Bressani will
work out of the Houston headquarters while
chief commercial officer Neill Kelly and chief
technology officer Geoff Fisher will be based
at the firm's Aberdeen site. Rigzone
South Africa hopes
to restore energy
ties with Iran
South Africa hopes to restore energy ties
with Iran, its energy minister said on Sunday,
according to Iran's Shana news agency, three
years after international sanctions halted oil
trade between the two countries.
"South Africa is aiming for a framework of
cooperation with Iran regarding crude oil,
LNG, LPG, gas and petrochemicals," Tina Joe-
mat-Pettersson was quoted as saying by Shana
during a visit to Tehran.
"South Africa's private sector can invest in
various parts of Iran's oil industry," she added.
Mohsen Ghamsari, director of international
affairs at the National Iranian Oil Company
(NIOC), said on Saturday that South Africa
was hoping to import crude oil and other
energy products from Iran, state news agency
South Africa bought around 68,000 barrels
per day (bpd) of crude from Iran in May 2012.
Last September, Africa's second-largest crude
consumer expressed interest in resuming
Iran's exports of crude have fallen to around
1.1 million bpd, from a high of 2.5 million bpd
in 2012, as Western sanctions have made it
difficult to find buyers.
Iran is negotiating with world powers to lift
sanctions in exchange for more stringent con-
trols on its disputed nuclear programme.
US weekly oil rig
count decline slows
The fall in the US oil rig count slowed this
week, data showed on Friday, suggesting the
collapse in drilling may be coming to an end
as prices recover after falling 60 per cent from
June to March.
The oil rig count fell by 24 this week to 679
active rigs, the smallest drop since early April,
after the loss of 31 and 26 rigs in the prior
two weeks, oil services firm Baker Hughes Inc
said in its closely-watched report.
With the oil rig decline this week, the num-
ber of active rigs has fallen for a record 21
weeks in a row to the fewest since September
2010, according to Baker Hughes data going
back to 1987.
Since the number of oil rigs peaked at 1,609
in October, producers have reacted quickly to
the steep drop in oil prices since the summer
by cutting spending, eliminating jobs and
idling more than half of the country's rigs.
The US oil rig count, however, is nearing
a pivotal level that experts say is bolstering
prices and trimming production, and will
eventually coax oil companies back to the well
pad in coming months.
US crude futures this week climbed to near
US$60 a barrel, the highest level this year,
helped by a weaker dollar and bets that a
supply glut would ease as the falling rig count
will start to reduce oil output.
That is a 43 per cent rebound from the
US$42 six-year low set in March on oversupply
concerns and lackluster demand.
After rising mostly steadily since 2009, US
oil production has stalled near 9.4 million
barrels a day since early March, the highest
level since the early 1970s, according to gov-
ernment data. Reuters
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