BG to start drilling in Spain
London - UK energy company BG Group said yesterday it would start a three-year, £20 million offshore exploration programme in Spain after the Spanish government approved its licence applications. In a statement, the company said its successful application for seven offshore exploration licences would allow it to start exploration drilling in an area the size of 30 North Sea blocks towards the end of 2003.
The effective date of the licence award is expected to be announced in the coming weeks. Any gas discoveries will be developed for the Spanish domestic market, the company said. "This is an important move for BG Group into the Spanish energy market, complementing our presence in the Mediterranean region," said BG's Executive Vice President Martin Houston in the statement.
Showa Shell's profit falls 79pc
Tokyo - Showa Shell Sekiyu, the Royal Dutch/Shell Group's Japanese refiner, said profit fell 79 per cent last year because of sluggish demand for fuels and a charge to reduce a shortfall in its pension fund. Showa Shell's 2001 group net income fell to 2.61 billion yen ($19.6 million), or 6.95 yen a share, from 12.5 billon yen, or 33.19 yen, the year before. Sales rose 1.6 per cent to 1.67 trillion yen, the company said.
Demand for gasoline and other fuel products has been falling as Japan's economic trouble deepens. Gasoline prices fell by an average of 5 yen last year to 100 yen a liter, according to the government-affiliated Oil Information Center of Japan. "The market remained competitive in 2001," said Vice President David Turner. "Continuing excess refining capacity and sluggish demand pressured margins." The company had 40.9 billion yen of one-time charges, including 30.6 billion yen to top up its pension fund, outweighing one-time gains of 15.8 billion yen from asset sales.
Unipetrol units post mixed results
Prague - Czech oil group Unipetrol yesterday said profits of its main business units fell in 2001 due to an economic slowdown in western Europe and compressed margins in the domestic market. The group's main unit, refinery Ceska Rafinerska, posted a net loss of 60.8 million crowns ($1.7 million).
Analysts estimates had ranged between a net loss of 287 million and a net profit of 116 million. "Due to a sharp fall in crude oil prices, Rafinerska was selling at prices below production costs in the last quarter of the year," Unipetrol said in a statement. Only the petrochemicals division, Chemopetrol, came out better than expected with net profit at 515 million crowns, above the most optimistic forecast of 457 million. Consolidated results are due on February 28.
Woodside profit falls 5.9pc
Melbourne - Australian oil and gas producer Woodside Petroleum Ltd said yesterday a production decline in 2003-2005 may be less severe than expected as existing fields hold up and future prospects gain momentum. Woodside, the operator of the giant North West Shelf gas project offshore Western Australia, earlier reported a calendar 2001 net profit of A$909.6 million ($473 million).
The result was down 5.9 per cent on 2000 as Petroleum Resource Rent Tax (PRRT) payments on production at its Timor Sea Laminaria field and lower oil prices ate into earnings. The tax kicked in once Woodside reached specified levels of financial returns.Woodside managing director John Akehurst said the company was still on the lookout for acquisitions to fill the gap, after failing in a bid for Europe's Veba Oil & Gas, but he was not concerned about a limited number of ideal opportunities.
Kazakhs merge top state firms
Astana - The leading state oil production and transport companies in Kazakhstan are to merge under a presidential decree to create a powerful consolidated energy company in the central Asian state, officials said yesterday.
The decree, released by the press office of President Nursultan Nazarbayev, said the merger would link oil firm Kazakhoil with state-owned crude oil and gas pipeline monopoly Transneftgaz (TNG). TNG includes KazTransOil and KazTransGas, responsible for shipping the bulk of Kazahstan's hydrocarbon output. Kazakhoil has 125 million euros of eurobonds in issuance. KazTransGas has also said it wants to issue debt this year on international markets.
PDVSA to reshuffle board
Caracas - Venezuela's state oil company Petroleos de Venezuela (PDVSA) will reshuffle its board of directors as part of ongoing efforts to bring the firm in line with the policies of President Hugo Chavez, a Ministry of Energy and Mines official told Reuters yesterday. The major shake up of the seven-member board comes just one week after Central Bank vice-president and Chavez loyalist Gaston Parra replaced Gen. Guaicaipuro Lameda as president of the state company.
The new board, to be sworn in tomorrow, will retain only two of the previous team, replacing the rest. Lameda had become increasingly critical of government interference in the nation's strategic oil sector. "We are trying to align energy policy to make PDVSA a strategic partner for development," the ministry official, who asked not to be named, told Reuters. Analysts say the changes in PDVSA are expected to make it easier for Chavez to tap the company's vast oil revenues to fund social programs of his self-proclaimed leftist "revolution".
TotalFinaElf vying for SPP control
Bratislava - European oil giant TotalFinaElf is one of six companies vying for control of Slovak gas monopoly SPP, a source said yesterday. Final bids for a 49 per cent stake and management rights in SPP are due on February 28. The oil pipeline administrator is Slovakia's most lucrative asset, and the minority stake in the firm is valued at $3.0 billion or more. "TotalFinaElf is in," said a source familiar with the deal who did not want to be identified.
A spokeswoman from TotalFinaElf in Paris declined to comment on the issue. SPP is the key link bringing Russian natural gas to western Europe. It moves around 90 billion cubic metres of gas annually, as well as distributing to more than 1.3 million clients in Slovakia. Last month, the government's adviser on the deal, Credit Suisse First Boston, said that seven parties were interested in the SPP stake. The source said six companies had finished due diligence in SPP, while the other firm could possibly participate as part of a consortium of bidders.
BG to start drilling in Spain