NEWS | Kemp: Data Availability Bias in the Oil Market | Rigzone

NEWS  |  Kemp: Data Availability Bias in the Oil Market  |  Rigzone: "Why is there such good data about oil in the United States but such poor data about everywhere else? Accurate information is essential for good decision-making, so it is remarkable how little reliable and timely data exists about the production and consumption of crude oil and refined fuels outside the United States. The situation in the other advanced economies, not to mention emerging markets, is mostly guesswork. The result is that oil analysts cannot even agree on production and consumption yesterday and today, let alone predict what will happen tomorrow. And because the best and most readily accessible data is for the United States, the market puts excessive emphasis on what happens there and neglects developments elsewhere. The obsession with weekly rig counts, production estimates and crude inventories in the United States as a sign of wider supply-demand trends in the oil market has been a case in point. But as long as U.S. data is more accurate, detailed and timely than the numbers for other countries, this example of "availability bias" is set to continue. Energy Crisis Some U.S. data comes from private companies such as Baker Hughes, which inherited the decades-old rig count from the Hughes Tool Company, but most is produced by the federal government. The U.S. Energy Information Administration, the independent statistical and analysis arm of the Department of Energy, provides by far the best data on oil and other energy markets anywhere in the world."

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NEWS | Shell's Ice Management Vessel Damaged In Alaska | Rigzone

NEWS  |  Shell's Ice Management Vessel Damaged In Alaska  |  Rigzone: "Royal Dutch Shell Plc's icebreaker vessel Fennica returned to the Dutch Harbor in Alaska with a small breech in the hull, raising concerns about the company's plan to resume drilling in the Arctic later this month. Shell said in June it plans to restart drilling for oil in the Arctic off Alaska as early as the third week of July after a conditional approval by the United States. "Any impact to our season will ultimately depend on the extent of the repair," spokeswoman Kelly op de Weegh said in an e-mail to Reuters. Fennica, owned by Arctia Offshore, is one of the primary ice management vessels in the Port of Helsinki during European winter."

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Precision sees room for rig rebound as producers weather slump

Precision sees room for rig rebound as producers weather slump: "Even with the oil market in a funk again, producers are adjusting and Precision Drilling Corp. sees the potential for more spending by customers in the second half. Canada’s largest drilling services company sees some room for the North American rig count to rebound as customers restart wells and upgrade equipment after cutting costs, CEO Kevin Neveu said in an interview. The current price slump poses no threat to Precision’s dividend, he said. “I think the rig count actually might have dropped a little lower than necessary,” Neveu said by phone from Calgary. “I think our customers have saved more money than they intended to save.” The oil and gas industry has cut spending by tens of billions of dollars and eliminated more than 100,000 jobs to weather the crude slump. Prices that had rebounded somewhat recently have tumbled 12% this month on concern the Greek crisis will hurt the global economy, while an end to Iran sanctions could boost supplies. Still, the number of active oil rigs in the U.S. increased to 640 in the week ended July 3 from 628 in late June, paring a 60% decline from October levels, according to Baker Hughes Inc., the Houston-based oil-services company that has kept rig counts since 1944. A strong rig-count recovery, though, would require U.S. oil prices at $60/bbl to $70/bbl, Neveu said. The West Texas Intermediate benchmark fell 0.4% to $52.33/bbl at the close in New York on Tuesday, after slumping 7.7% on Monday. Precision Drilling is the ninth-best performer on the Standard & Poor’s/TSX Energy Index this year, up 6.9%, compared with a 7.8% decline in the 63-member indicator. It has a market value of C$2.2 billion ($1.7 billion)."

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NEWS | Succession Planning Critical for Longevity of Oil, Gas Companies | Rigzone

NEWS  |  Succession Planning Critical for Longevity of Oil, Gas Companies  |  Rigzone: "In recent months, restructuring has become almost an industry buzzword as oil and gas companies across the globe have adjusted their organizations’ operations in response to the dramatic decline in oil prices that began in late 2014. In mid-June, Qatar Petroleum, the world’s largest producer of liquefied natural gas (LNG), completed an 8-month restructuring plan which included laying off foreign staff and taking over its foreign investment arm, Qatar Petroleum International. The company is focusing on future international expansion. And with the current market climate, there are many other companies following suit: restructuring, implementing organizational planning and identifying the necessary changes that will help propel their company through the downturn. Part of that includes preparing for the sudden or voluntary change of a CEO or senior level executive. By taking a strategic approach to succession planning, oil and gas companies will be better equipped to handle the cycles common to the industry.   Who Should Be Involved in Succession Planning Tobias ReadCEO, Swift Worldwide Resources As a company’s succession planning involves developing internal employees to fill key leadership positions, it seems almost detrimental for a company not to have this process in place. And according to Swift Worldwide Resources CEO Tobias Read, it can be.  “Companies that don’t look at succession planning are likely to end up failing,” Read told Rigzone. “Many CEOs won’t put succession plans in place very deliberately because they’re paranoid” of losing their job. The truth is, with the downturn, we’ve seen quite a few CEOs of oil and gas companies come and go. Those who are prepared for the transition stand to fare better than those who aren’t. "

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NEWS | Brazil Clears Shell's $70B Purchase Of BG | Rigzone

NEWS  |  Brazil Clears Shell's $70B Purchase Of BG  |  Rigzone: "Brazil gave the green light to oil major Royal Dutch Shell to buy smaller rival BG, advancing the $70 billion merger - the largest of the past decade - closer to completion in early 2016. Shell is set to become the largest foreign operator offshore Brazil after it buys BG, so the clearance from the country was a crucial step to complete the merger on time. Brazil's competition authority CADE said on Wednesday it had given preliminary approval to the transaction "without restrictions." BG said that if no appeals were lodged or referrals made in the next 15 days, CADE's clearance would become final. A spokesman for Shell confirmed the approval and the 15-day appeals period. The proposed acquisition had previously obtained a green light from United States Federal Trade Commission (FTC) and now only needs pre-conditional approvals from the European Union, Australia and China for the merger to go ahead. "The filing process for each of these is under way, and the transaction is on track to complete in early 2016," it said. Shell and BG produced a combined 212,252 barrels of oil equivalent per day in Brazil in May, or 7.1 percent of the country's total. Analysts expect this figure to double to nearly 500,000 boepd by 2020. The two companies have stakes in Brazil's most exciting oil plays, with BG owning 25 percent of the massive Lula field and Shell owning 20 percent of the Libra prospect."

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Pemex pulls out of Mexico licensing auction as oil slides

Pemex pulls out of Mexico licensing auction as oil slides: "Mexico’s national oil company withdrew from the country’s first license auction to conserve cash and focus on bringing in partners for its existing operations. The company known as Pemex, which has battled accidents and faced years of falling production and shrinking revenues, won’t bid in the auction of 14 oil blocks, Energy Minister Pedro Joaquin Coldwell said Wednesday. It’s focusing on the upcoming farm outs and was dissuaded from bidding after falling oil prices crimped earnings, he said at an event in Mexico City. “Pemex has seen its income reduced by more than 50% due to the fall in the price of oil,” he told reporters in Mexico City, adding that the company would participate in later auctions planned for this year. The unexpected withdrawal leaves 17 companies and seven groups planning to participate in the auction. Glencore Plc and Noble Energy Inc. together with PTT Exploration & Production PCL and Ecopetrol SA also pulled out of the event this week. Mexico will auction 169 oil blocks in onshore and offshore fields in the so-called “round one,” after last year passing legislation to end Pemex’s monopoly and open the country’s energy industry to private competition. Withdrawals Several companies pre-approved to bid on Mexico’s oil blocks have resisted the requirements for each bidding group to have one partner to act as guarantor, and for that company to maintain shareholder equity, or total assets minus liabilities, of at least $6 billion. The stipulation of a single guarantor, rather than sharing the burden among partners, is proving prohibitive for some companies, according to Alfredo Alvarez, Mexico’s energy sector leader at Ernst & Young LLP. “For the larger companies and the majors, a parent guarantee isn’t something a lot of them are going to tolerate,” Alvarez said in a phone interview. Mexico “will likely lose a few bidders and that is unfortunate because they would have had a few more bids had they been more open-minded.”"

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NEWS | Azerbaijan President Open to Snam Taking Stake in TAP project | Rigzone

NEWS  |  Azerbaijan President Open to Snam Taking Stake in TAP project  |  Rigzone: "Azerbaijan is open to Italian gas infrastructure group Snam taking a stake in the project to build the Trans Adriatic Pipeline (TAP) that will carry gas from Azerbaijan to Europe, President Ilham Aliyev said on Thursday. "Why not? If someone would allocate its shares to other companies I don't see any problems," Aliyev said when asked about Snam's possible investment in TAP. He spoke in English to reporters during a visit to Milan's EXPO international trade fair. Snam CEO told Reuters in an interview in June the company was ready to evaluate buying 20 percent of TAP."

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