oil

A golden year for OPEC in 2010

2010-10-26T16:27:00.001-07:00

A golden year for OPEC in 2010

The Organization of the Petroleum Exporting Countries will celebrate its golden anniversary this year, with a series of cross-cultural activities stretching across four continents.

These will culminate in a major anniversary symposium in September that will see prominent OPEC officials – past and present – reflect on the Organization’s successes during its unique 50-year history.

The Austrian capital, Vienna — seat of OPEC’s Secretariat — will provide the location for an exhibition charting the Organization’s development over the past half century. Similar events will be staged in OPEC’s Member Countries in Africa, the Middle East and South America, with the accent on arts and culture. Special commemorative postage stamps have been designed to mark the anniversary in Austria and Member Countries.

Vienna will also witness the grand finale of an energy industry-related quiz that will test the skills of schoolchildren from Member Countries and beyond. At a more visual level, there will be a drawing competition for students from host nation Austria.

Numerous special publications and a redesigned Website will complete the year’s packed line-up, to provide deeper insights into OPEC and its Member Countries and into the many challenges they face in today’s high-tech, globalised, interdependent petroleum sector.

The celebrations are already underway, with the unveiling of the prizewinning design for the 50th anniversary logo on the Website on New Year’s Day.

OPEC was established by five oil-producing developing countries in Baghdad, Iraq, on 14 September 1960. It now has 12 Members committed to a stable oil market, fair and reasonable prices, secure supply and fair returns to investors, as well as supporting sustainable development and addressing global environmental concerns.

Venezuela victorious in historic OPEC quiz

2010-10-26T16:26:00.001-07:00

Venezuela victorious in historic OPEC quiz

Vienna, 30 June 2010--Luis de la Hoz, a 17 year-old student representing Venezuela, swept to victory in OPEC's first ever international quiz, held in the OPEC Secretariat today. The quiz forms part of the Organization's 50th anniversary celebrations.

Luis held off tough competition from nine other students, all under 18 years of age, to emerge victorious after a tricky three rounds of questioning about OPEC's history, its Member Countries and the international oil industry. Alongside Luis were students from eight other Member Countries, one each from Ecuador, IR Iran, Iraq, Kuwait, SP Libyan AJ, Nigeria, Qatar and Saudi Arabia, as well as a student from host country Austria.

The competition which was broadcast live on the OPEC Website was enjoyed by an audience that included Ambassadors, Austrian dignitaries, local press and other students from both Austria and overseas, who were treated to an impressive display of knowledge from all contestants.

"I feel very proud of representing my country," said Luis, who hails from western Venezuela and hopes to be a systems engineer when he finishes studying. "It's been a huge experience for me. I studied a lot for this, but my teachers and family and friends helped me a lot. My mother was very proud - she cried when I won."

Kehinde Olatunde, 16, from Nigeria took second place and Jose Andres Yanchapaxi, 18, from Ecuador took third, but all contestants - many of whom were visiting Europe for the first time - were winners in their own right; all had won qualifying rounds in quiz-related competitions in their own countries.

Today's event was the culmination of a fun and culture-filled two days for the contestants. After being welcomed to Vienna on Monday by OPEC officials, they were given a guided tour of Vienna and were received in the city's majestic town hall or Rathaus. After the quiz, contestants were awarded prizes, souvenirs and certificates by the OPEC Secretary General, Abdalla Salem El-Badri, and were treated to a rousing performance by the VORLAUT children's choir, a joint project of the OPEC Fund for International Development and the Vienna Konzerthaus, Caritas Vienna and the Vienna Boys' Choir. The project aims at supporting children from marginalized groups in Vienna by integrating them into musical activities to enhance their overall capabilities.

The quiz is just one of many activities being held this year to mark OPEC's Golden Jubilee. Other activities include exhibitions, soccer matches, anniversary stamps and a range of special publications.

Qatar congratulates OPEC on 50th Anniversary

2010-10-26T16:25:00.001-07:00

Qatar congratulates OPEC on 50th Anniversary

Vienna, 20 August 2010--The Organization of the Petroleum Exporting Countries (OPEC) has been commended for its work over the past 50 years in helping to bring stability to the oil markets, and for its ability to adapt to "new technologies and shifting market conditions [which] have transformed the oil industry."

The commendation came from the Deputy Premier and Minister of Energy and Industry of Qatar, HE Abdullah bin Hamad Al Attiyah, in a two-page letter addressed to OPEC's Secretary General, HE Abdalla Salem El-Badri.

In his , Al Attiyah congratulated OPEC's Member Countries for the role they have played, individually and collectively, in achieving success for the Organization. "[They] have developed trusting and open relationships based on mutual respect and common interests," attributes which, according to him, are key reasons for OPEC's longevity and success.

Al Attiyah, who is currently OPEC's longest serving Head of Delegation, also drew attention to OPEC's contribution to poverty alleviation and development in poorer nations through the OPEC Fund for International Development (OFID).

OFID is the direct outcome of the First Summit of OPEC Heads of State in 1975. Since it was formally established in 1976, "[OFID] has provided development assistance to around 125 countries and has played a significant role in the global fight against poverty," Al Attiyah noted.

Founded in September 1960 in Baghdad, Iraq, OPEC consists of twelve Member Countries, namely Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates and Venezuela.

OPEC daily basket price stood at $78.54 a barrel Friday, 22 October 2010

2010-10-26T16:24:00.001-07:00

OPEC daily basket price stood at $78.54 a barrel Friday, 22 October 2010

Vienna, 25 Oct. 2010--The price of OPEC basket of twelve crudes stood at 78.54 dollars a barrel on Friday, compared with $79.26 the previous day, according to OPEC Secretariat calculations. .

The new OPEC Reference Basket of Crudes (ORB) is made up of the following: Saharan Blend (Algeria), Girassol (Angola), Oriente (Ecuador), Iran Heavy (Islamic Republic of Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Qatar Marine (Qatar), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela).

The Relationship between OPEC and other International Organizations

2010-10-26T16:19:00.000-07:00

The Relationship between OPEC and other International Organizations

Speech by OPEC Secretary General, HE Abdalla S. El-Badri, to the International Energy Symposium, on the occasion of OPEC’s 50th Anniversary - Riyadh, Kingdom of Saudi Arabia, 18-20 October 2010

Excellencies, ladies and gentlemen,

Good morning.

I would like to begin by expressing my appreciation to His Excellency Ali I. Al-Naimi, Minister of Petroleum & Mineral Resources of the Kingdom of Saudi Arabia, for the invitation to speak at this International Energy Symposium, and my sincere thanks to the Chair of this session, His Royal Highness Prince Abdulaziz Bin Salman Al-Saud. It is a great honour for me to participate in this event; one that marks the happy occasion of the 50th Anniversary of the Organization of the Petroleum Exporting Countries.

Fifty years ago, when OPEC was set up in Baghdad, there were some who predicted that the Organization would not last long. Fifty years on, however, that initial small group of developing oil producing countries has evolved into a group of twelve. These come from across the world and have brought more strength and diversity to the Organization.

It has certainly not been an easy task to advance the Organization's standing and influence, particularly given the nature of the oil industry at the time of its establishment. As I am sure you are all aware, the main catalyst for its birth came in 1959, when a group of international oil companies - the Seven Sisters - unilaterally reduced the posted prices of the crude they supplied.

At that time, these international companies were the dominant force in the oil market, playing the major roles and deriving the greatest benefits from all segments of the business, from exploration to final distribution. They controlled the quantity of oil extracted and sold, to whom it was sold, and at what price. And decisions were made without ever consulting host Governments of oil-producing countries.

So in 1960, five oil-producing developing countries - Iran, Iraq, Kuwait, the Kingdom of Saudi Arabia and Venezuela - came together around the premise of cooperation. They have since been joined by Qatar, Libya, United Arab Emirates, Algeria, Nigeria, Ecuador and Angola.

The founding of OPEC was a commitment based upon the need to safeguard their legitimate national interests and to ensure order and stability in the international oil market. It was about gaining the full sovereignty over their exhaustible non-renewable natural resources.

Over the years, this cooperation has grown stronger as the Organization has evolved and become an established and respected member of the global energy community. In the years ahead, OPEC's dedication to the welfare of its Member Countries, the international energy market and the global economy will of course continue.

This very brief history underlines the importance OPEC attaches to cooperation and dialogue. It was an essential part of its founding, has been fundamental to its evolution, and will be a key element in the Organization's future.

Of course, the issue of cooperation is central to the main topic I have been asked to talk about today: 'The Relationship between OPEC and other International Organizations'.

OPEC has long recognized the importance of adopting a plurilateral approach to addressing major topical issues, involving dialogue and cooperation with other international organizations and interested parties. This applies to both direct oil industry matters, as well as related areas, such as environmental protection and sustainable development.

At first, however, OPEC found it difficult, if not impossible, to establish dialogue and start cooperation outside of OPEC circles. This is due mainly to the hostile environment that prevailed when OPEC was born.

Gradually this changed. And there was a coming together and an understanding that in many respects our interests, particularly in regard to market stability, were, if not identical, at least similar. We have come a long way, from the early confrontation to the cooperation we see today.

Today, the importance of dialogue between international organizations, particularly in terms of bringing together producers and consumers, has never been greater. The reason is that globalization, international trade and mass communication are bringing us all closer together. We live in an increasingly interdependent world. This fact was clearly evident during the global financial and economic crisis. The knock-on impacts have been felt in almost all industries and in all countries across the world.

And, with energy central to each and every one of us, it is critical that all stakeholders work together for market stability. This is vital for the effective and efficient functioning of the global energy market.

In the global oil market, while demand for oil is clearly set to grow in the coming years, a number of factors that could have both medium- and long-term impacts on supply exist. This includes the policies of a number of consuming countries that offer an unclear picture of their impact on future oil consumption levels and overall energy demand. There is a need to provide clearer policies that are reliable, predictable and not discriminatory. Market stability is essential for both producers and consumers.

In addition, there is the need for a better understanding of such matters as the effects of excessive market volatility, the role of speculation, the future requirements for human resources as well as the impact of climate change and of mitigation policies and measures.

We should also never forget that it is a world in which energy poverty continues to blight the lives of billions of people. It is an issue that needs the urgent and critical attention of world leaders.

To help meet some of these challenges and uncertainties facing the global oil market, and the world, in general, we at OPEC believe in continually looking to explore and evolve our dialogue and cooperation with other international organizations. We recognize the value of strong and mutually-beneficial relationships.

In this regard, OPEC continues to maintain a strong and positive relationship with the European Union (EU). In the latest EU-OPEC Ministerial Dialogue that took place in June this year, the two organizations highlighted a number of relevant and topical areas where cooperation could be furthered. This included the need to continue to analyze and discuss the root causes of the recent financial crisis and economic recession; to organize roundtables on the challenges facing offshore oil and gas exploration and production activities and the causes of the skilled workforce shortage in the energy and oil industry; and to develop a study to explore the potential of technological advances in transportation.

OPEC and the EU also remain in discussions about enhancing cooperation through the development of an OPEC-EU Technology Centre, with energy technologies identified as one of the most important areas for cooperation.

Cooperation between OPEC and the IEA goes back many years and has advanced considerably. In recent years, a number of joint workshops on a variety of topical issues have been held and both Mr. Tanaka and I have made visits to the headquarters of our respective organizations. OPEC sees the dialogue between the two as an important element in improving the understanding of the concerns of all parties for oil market stability and predictability.

OPEC has also been proud to have played an active part in the formation of the International Energy Forum, whose Secretariat is now located here in the Kingdom of Saudi Arabia. It was founded as a platform that helps informal dialogue between producers and consumers and OPEC continues to support the IEF in providing this function.

This can be seen in the Organization's active participation in the IEF's Joint Oil Data Initiative, set up to enhance the transparency, quality, timeliness and flows of oil market data. We remain committed to furthering this project.

The Cancun Declaration, which was a result of the initiative begun by Saudi Arabia when it held an ad-hoc energy meeting in June 2008, maps out a path for a strengthened IEF, specifically through the development of an IEF Charter. Furthermore, it outlines specific areas of cooperation between the IEF, the International Energy Agency (IEA) and OPEC. This covers present and future market trends; the functioning and regulation of energy markets; and data.

The Organization and its Member Countries have also been, and continue to be, actively involved with many United Nations Organizations. This includes the United Nations Commission on Sustainable Development and, of course, the long-standing negotiations within the framework of the United Nations Framework Convention on Climate Change and its Kyoto Protocol.

I think we all appreciate that the climate change negotiations can, at times, feel extremely complex and, on occasion, appear to be never-ending. However, OPEC recognizes the importance of being part of these negotiations and of working with all parties and organizations to develop solutions that safeguard the legitimate interests of all parties.

In this regard, I am sure all stakeholders agree that any future agreement should be balanced, fair and equitable. It needs to take into account the past, present and future; the fulfilling of current commitments and obligations; address the net emissions of all greenhouse gases; use all available cost effective abatement options and technologies, including cleaner fossil fuel technologies, such as carbon capture and storage; and remain focused on the priority of sustainable development, particularly in regard to those least able to help themselves.

Additionally, OPEC has furthered dialogue this past decade with countries such as China, Russia and a number of other non-OPEC producers, as well as with other international organizations, such as the World Bank, the International Monetary Fund, and the World Trade Organization.

We also hope to expand our dialogue with other international organizations, as well as countries, such as India and Brazil.

Excellencies, ladies and gentlemen,

In summing up, let me stress once again that OPEC, in its 50th Anniversary year, remains faithful to the cooperation and the commitments that were agreed in Baghdad 50 years ago; to ensure market stability, an efficient and regular supplies of petroleum to consumers, a steady income to producers, and a fair return on capital for those investing in the petroleum industry.

Thank you for your attention.

A golden year for OPEC in 2010

2010-09-24T07:24:00.001-07:00

A golden year for OPEC in 2010

The Organization of the Petroleum Exporting Countries will celebrate its golden anniversary this year, with a series of cross-cultural activities stretching across four continents.

The celebrations are already underway, with the unveiling of the prizewinning design for the 50th anniversary logo on the Website on New Year’s Day.

Venezuela victorious in historic OPEC quiz

2010-09-24T07:22:00.000-07:00

Venezuela victorious in historic OPEC quiz

Today's event was the culminationof a fun and culture-filled two days for the contestants. After being welcomed to Vienna on Monday by OPEC officials, they were given a guided tour of Vienna and were received in the city's majestic town hall or Rathaus. After the quiz, contestants were awarded prizes, souvenirs and certificates by the OPEC Secretary General, Abdalla Salem El-Badri, and were treated to a rousing performance by the VORLAUT children's choir, a joint project of the OPEC Fund for International Development and the Vienna Konzerthaus, Caritas Vienna and the Vienna Boys' Choir. The project aims at supporting children from marginalized groups in Vienna by integrating them into musical activities to enhance their overall capabilities.

2010-09-24T07:21:00.000-07:00

OPEC, IEA, OECD, World Bank submit joint report to the G-20 Summit

Vienna, 2 July 2010--OPEC, along with the World Bank, the OECD and the IEA was requested by the G-20 leaders when they met in Pittsburgh, in September 2009, to provide an analysis of the scope of energy subsidies and offer suggestions for the implementation of the G-20 initiative. This was aimed at rationalising and phasing out, over the medium term, "inefficient fossil fuel subsidies that encourage wasteful consumption".

After much debate and hard work, the four International Organizations have succeeded in addressing the broader developmental context in which energy subsidies are embedded and in this , present, wherever possible, preliminary quantitative estimates of energy subsidies.

Qatar congratulates OPEC on 50th Anniversary

2010-09-24T07:20:00.002-07:00

Qatar congratulates OPEC on 50th Anniversary

In his message, Al Attiyah congratulated OPEC's Member Countries for the role they have played, individually and collectively, in achieving success for the Organization. "[They] have developed trusting and open relationships based on mutual respect and common interests," attributes which, according to him, are key reasons for OPEC's longevity and success.

Opening message to the special 50th Anniversary issue of the OPEC Bulletin

2010-09-24T07:20:00.001-07:00

Opening message to the special 50th Anniversary issue of the OPEC Bulletin

by OPEC Secretary General, HE Abdalla Salem El-Badri

The Fourteenth of September 2010 is a very special day for OPEC. This sees the Organization celebrate its 50th anniversary.

Few would have believed half a century ago that the Organization would have risen to the heights it has today in the global energy arena. This is because OPEC's birth in Baghdad was a low-key event involving just its five Founder Members in a very different world to that of today.

The oil industry was dominated by the major oil companies and this was reflected in its structure and its behaviour. The industry's prime purpose in the previous 15 years had been to fuel the post-Second World War reconstruction of the developed countries in the then-colonial world with all its inherent injustices - and then to maintain the momentum of this unjust situation without due regard to the interests of the poor developing countries from which most of the essential crude oil was coming.

In the context of that time, it was therefore a heroic act by the Founder Members to come together in the Iraqi capital 50 years ago and decide that enough was enough. They could no longer allow the lifeblood of their economies to be drained.

At first, in the 1960s, little was heard about OPEC, as its Membership grew and it engaged in endless rounds of discussions with the dominant international oil companies, in order to acquire a greater say in how their indigenous oil resources were exploited and hence their national destinies mapped out.

At the time that this was happening, fundamental changes were occurring across the world, and, in the context of OPEC's evolution, many developing countries were acquiring independence.

And so the time was ripe for OPEC and its Member Countries to take some profound steps in asserting their sovereign rights to the exploitation of their indigenous natural resources, in the interests of their domestic economic and social development and for the benefit of their peoples. In the early 1970s, this saw a wave of oil industry nationalizations, as well as these countries gaining a major say in the pricing of their crude oil on world markets.

Since then, OPEC and its Member Countries have gone from strength to strength.

While OPEC has focused much of its attention on the welfare, development and growth of the oil industry itself - together with its commitment to secure, steady supply with reasonable prices to consumers and fair returns to investors - it has also broadened out the scope of its activities to the energy sector at large and, indeed, much further afield than that. Here, I refer to its championing of issues affecting mankind as a whole, most notably sustainable development, the eradication of energy poverty and care for the environment.

In 50 years, OPEC has become a notable player on the world stage. This has not just been because of the contributions of its Member Countries to international oil supply. But it has also been due to OPEC's progress and achievements being envisaged as a beacon of hope to other developing countries. In short, OPEC has shown that it is possible for well-intentioned, but heavily exploited developing countries to stand up for themselves, develop their economies, defend their sovereign interests and make a significant contribution to the global community in a constructive and meaningful way.

Of course, the world today is a much more integrated, interconnected and interdependent globalized arena than it was 50 years ago.

But OPEC's establishment, growth, assertiveness and expanding outreach have served a purpose in demonstrating to other developing countries just what can be achieved through perseverance and steadfastness, when the cause is a just one.

Therefore, as OPEC celebrates its 50th anniversary, it does so with a feeling of achievement and satisfaction, together with the firm intention of remaining true to its principles well into the future, to the benefit of its own Member Countries' national development, international oil supply, world economic growth, poverty eradication and the global community at large.

Finally, no occasion like this would be complete without a full appreciation of the efforts of all those who have worked so hard over the past 50 years to make OPEC the success it has become. These include generations of Heads of State and Government, Ministers, Governors and other high-level experts from outside the Secretariat and, from within the Secretariat, Secretary Generals, Management and Staff of every relevant discipline, enriched by their broad multicultural spread. Inherent qualities have included courage, vision, enterprise, ambition, commitment, perseverance and sacrifice, to cope with the many ups and downs experienced by the Organization and its Member Countries, as these much-valued individuals have sought, day in, day out, to pursue OPEC's noble objectives.

I am sure that I am speaking on behalf of all my distinguished predecessors as Secretary General when I express a profound and heartfelt "thank you" to all those who have contributed to OPEC's success during this time and have utilized all these qualities to the full in the interests of the growth and development of the Organization.

This gratitude extends to the Republic of Austria and the City of Vienna, which have been warm and generous hosts to the Secretariat since we moved to this grand, historic city in 1965. Our new purpose-built premises provide the ideal base from which to meet the many challenges we shall face as we enter our second 50 years in a confident and determined manner.

OPEC daily basket price stood at $74.28 a barrel Thursday, 23 September 2010

2010-09-24T07:19:00.001-07:00

OPEC daily basket price stood at $74.28 a barrel Thursday, 23 September 2010

Vienna, 24 Sep. 2010--The price of OPEC basket of twelve crudes stood at 74.28 dollars a barrel on Thursday, compared with $74.41 the previous day, according to OPEC Secretariat calculations. (View Archives).

International Developments in the Oil and Natural Gas Markets and their impact on Arab Countries

2010-09-24T07:17:00.000-07:00

International Developments in the Oil and Natural Gas Markets and their impact on Arab Countries

Speech by OPEC Secretary General, HE Abdalla Salem El-Badri, to the 9th Arab Energy Conference, Doha, Qatar, 9-12 May 2010

Mr Chairman,
Excellencies,
Ladies and gentlemen,

Good afternoon:

I am delighted to be back in this dynamic and expanding city of Doha and I am deeply honoured to participate on this panel.

I should like to share with you OPEC’s views on recent developments in the energy scene and their impacts. The changes that the energy scene has witnessed over the last few years have been dramatic. They stem from two main causes: the global financial crisis, and the subsequent economic downturn, and the inefficient functioning of oil markets in terms of price discovery.

The financial crisis, which began in the summer 2007 and reached its height in September 2008 with the near collapse of the global financial system, has had a profound impact on the real economy. The world has faced its longest, deepest and most-widespread contraction in more than six decades.

This, in turn, adversely affected the energy sector.

The years 2008 and 2009 were the first time since 1981 that global oil demand declined in two successive years. The cumulative impact was a fall of 1.8 million barrels a day. The price of a barrel of crude lost almost 100 dollars in less than six months from mid‐2008. The demand for OPEC crude fell sharply and the resulting supply adjustment by OPEC Member Countries led to a significant increase in unused production capacity. Today, this figure is 6 million barrels a day.

Natural gas demand also declined, at a time when conventional and unconventional gas supplies were increasing, which led to a sharp downward trend in gas prices.

The financial crisis, the economic downturn and lower petroleum prices have had visible adverse effects on Arab Countries. This has been through many channels, such as trade, declines in the value of stock markets and investments portfolios values and lower economic growth. It has shown how deeply interconnected these economies are with the rest of the world. It underlines the need for even more diversified economies and the importance of policies to mitigate the effects of economic cycles and volatility in commodity markets.

Yet we should also remember that while there is a richness and diversity about the economic culture of the Arab world, in both the traditional and modern sectors, it is an undeniable fact that a viable petroleum industry provides an important economic stimulus for the area as a whole.

Regarding oil exports revenues, the crisis demonstrated once again the positive role that OPEC plays as a producer organization in contributing to stable oil markets, for the benefit of all.

Today, thanks to massive monetary and fiscal stimulus packages, the global economic recovery is proceeding at a satisfactory pace, in particular in developing countries. Oil demand is growing again, albeit at an expected modest rate of 900,000 barrels a day for 2010. And prices are at a reasonable level that is satisfactory to both producers and consumers.

However, the risks remain high. They relate to the high levels of public debt in some OECD countries; the unsustainable rates of unemployment in many places; credit tightness and the still fragile financial system; the shaky recovery in private demand that is not yet sufficient to fully support economic expansion; and the associated government support exit strategies.

We therefore need to remain vigilant and avoid complacency.

The other cause that I mentioned earlier is the inefficient functioning of oil markets.

Indeed, oil markets have over the past few years been characterized by excessive volatility and large price swings. Many recognize that the emergence of oil as a financial asset traded through a diversity of instruments in futures exchanges and over-the-counter markets may have helped fuel excessive speculation to drive price movements and stir up volatility. It led to a situation where futures prices were, to a certain extent, detached from the supply and demand fundamentals of the underlying commodity.

This was discussed in detail at the recently held International Energy Forum meeting in Mexico, and we welcome the Cancun Ministerial Declaration, which is a clear indication that nobody wants a repeat of 2008 — neither producers or consumers.

As I said earlier, fortunately the oil market situation has steadily improved over the past year. The more reasonable price levels we see today support investment to provide the much-needed future production capacity. Shelved projects are now being restarted, there is a noticeable rise in activity and in general, there is a more optimistic mood than a year ago. It means we can now return to focusing our attention on the important longer term energy challenges.

Economic growth, expanding populations and higher standards of living mean that energy demand is set to rise in the future, despite significant improvements in energy efficiency. We expect energy use to increase by more than 40 per cent by 2030, according to OPEC’s World Oil Outlook reference case. Fossil fuels, and in particular, oil and natural gas, will continue to satisfy most of the world’s energy needs. This means that the Arab world, with considerable petroleum resources, will continue to play a leading role in the energy scene, far into the future.

And we should never forget that the global need for modern energy services is huge. Here I am thinking about the 1.5 billion people who do not have access to modern energy services and the 2.5 billion people who use solid fuels for cooking and heating, with severe health problems resulting from indoor pollution. In this regard, I wish to emphasize the extremely beneficial role played by Arab Country aid institutions and by our sister organisation, OFID, in contributing to the alleviation of poverty and an improvement in energy access in many developing countries.

However, while we know that energy is set to grow over the long-term, the actual pace of this growth remains highly uncertain.

OPEC’s World Oil Outlook shows that as early as 2020, demand for OPEC crude could be as low as 29 million barrels a day or as high as 37 million barrels a day. This translates into an uncertainty gap for upstream investments in OPEC Member Countries of over 250 billion dollars. There is, therefore, the very real possibility of wasting financial resources on unneeded capacity.

These daunting uncertainties stem in part from consuming countries announcing policies that are geared towards reducing oil demand, subsidizing alternatives and putting heavy tax burdens on the use of oil. Inconsistent, unrealistic and wishful-thinking policy announcements can only provide the wrong signals to markets and investors, creating a lack of certainty and predictability that undermines the ability of the oil industry to invest to meet future energy demand.

This has been epitomized in recent climate change negotiations, where fundamental principles that are enshrined in the United Nations Framework Convention on Climate Change, such as the principle of equity and common but differentiated responsibilities, have run the risk of being watered down by some developed countries. These attempts should be resisted. Historical responsibility of developed countries regarding the state of the Earth’s atmosphere cannot be ignored, as the provision of the UNFCCC that the first and overriding priorities of developing countries are socio-economic development and poverty eradication.

Without the confidence that there will be additional demand for oil, there may be no incentives to invest. And if investments are not made in a timely manner, then future consumer needs might not be met.

Returning to Arab countries, it is clearly evident that huge and successful efforts have been undertaken by many countries to diversify their economies. This includes investing in industries that bring more added-value energy-intensive products, developing tourism and creating logistical port hubs. Many have also recognized the importance of human capital and have invested in advanced universities and research centres in cooperation with some of the best global institutions. This also includes investing in other energy sources, such as solar and nuclear.

All these efforts and achievements are to be praised.

Nevertheless, these economies often remain highly sensitive to both price volatility and to the uncertainties surrounding future energy demand. This underscores the importance of continuing to push economic diversification, especially given the needs of a younger population and the ensuing huge need for job creation in many countries.

Excellencies, ladies and gentlemen,

The recent difficulties in the energy scene and the challenges that I have described are not new for OPEC.

Since it was established in 1960, the Organization has faced many crises and challenges. It has, however, always survived and has successfully overcome many challenges. It has not only learned from these, but it also gained resilience.

When OPEC was born, the Middle East was already an important and growing crude supply region, while North Africa was in the early stages of developing its newly found oil reserves. At that time, the five Founding Members of OPEC held a total of around 200 billion barrels of reserves or two-thirds of world reserves. On average, they supplied 8 million barrels a day of crude to world markets, representing more than one-third of the total world production.

Today, 50 years later, OPEC is even more important.

OPEC reserves have increased by a factor of five to reach one trillion barrels and its daily production has multiplied by nearly four, to reach 29 million barrels a day. Its production capacity exceeded 35 million barrels a day in 2009.

Of course, this growth is partly due to the fact that OPEC went from having five to 12 Members. But, even if we limit the comparison to the five original Founding Members, the growth is still impressive.

The increased importance of OPEC has been accompanied by a growing recognition of its positive role and by greater trust and confidence in its actions.

OPEC has broadened its dialogue with producers and consumers alike. We are an active partner in the International Energy Forum. We have a high-level of cooperation with many international institutions.

We firmly believe in genuine dialogue and cooperation between energy producers and consumers. This is key to ensuring a stable and predictable energy scene for the benefit of all.

Thank you

Transocean rig leaving Gulf of Mexico for Egypt

2010-09-24T07:16:00.000-07:00

Transocean rig leaving Gulf of Mexico for Egypt

Another Transocean Ltd rig is leaving the deepwater Gulf of Mexico, still under contract with Statoil -- the fourth rig departure resulting from a moratorium on U.S. deepwater drilling.

The world's largest offshore drilling contractor said the Discoverer Americas would leave next week, becoming its second rig to depart the region since the disaster in April that destroyed the company's Deepwater Horizon.

An explosion on that rig, under contract with BP Plc, led to an environmental disaster and a U.S. moratorium on deepwater drilling, which the Interior Department said on Tuesday was unlikely to last beyond November 30.

Analysts have said they do not expect many more rigs to depart the region, so long as the moratorium expires on time.

Norway's Statoil will pay $486,000 a day for the Discoverer Americas in Egypt, or $4,000 more than before, when the new five-month contract starts in October. The rig is then due back in the Gulf of Mexico next March at the same rate, under a contract running until November 2013.

In July, Diamond Offshore Drilling Inc agreed with Devon Energy Corp to move a Gulf of Mexico rig to Egypt with a new operator, followed by Murphy Oil Corp moving a Diamond rig to the Republic of Congo until it can meet the Gulf of Mexico regulatory requirements and return.

Transocean said earlier this month that its Marianas rig was heading out of the Gulf of Mexico with Italy's Eni, bound for West Africa.

Before the moves, there were 30 deepwater rigs contracted for the Gulf of Mexico this year, including others owned by Noble Corp, Ensco Plc and Seadrill.

Transocean also said in its fleet report that it pulled two of its shallow-water rigs off the market due to lack of demand, leaving only 35 of its 65 jackups under contract.

The GSF Labrador, in the UK North Sea, had earned $90,000 a day before its contract ran out in July, while the Roger W. Mowell had a dayrate of $150,000 in Malaysia up until August.

Shares of Transocean, which have lost more than a third of their value since the April 20 Deepwater Horizon explosion, fell 20 cents to $58.15 in after-hours trading on Tuesday.

Kuwait Energy drills deep in Western Desert

2010-09-24T07:15:00.002-07:00

Kuwait Energy drills deep in Western Desert

Eng. Osama Farouq, the Vice President for Exploration & Development in Kuwait Energy Egypt Company, told Egypt Oil & Gas newspaper in exclusive statements that his company succeeded to win the approval of EGPC to drill 4 expletory wells in the Abu Sinan concession in the Western Desert, after extracting the needed permits.

The total cost of drilling the four wells $6million, as the company conducted a market survey to rent a rig of 2000hp due to time constraint, as it must carry out a tender to do that.

Al Anbaa, the Kuwaiti newspaper, recently announced that the company said it considered the previous exploration in that area as the biggest of its kind.

Egypt Oil & gas newspaper also learned that Kuwait Energy drills the deepest wells in the Western Desert area, as the depth reaches 18, 400 feet. The first test will be conducted next week with a cost of $7million using SHENGLI BOHAI’s rig, which has a capacity of 2000hp.

Al Anbaa newspaper also referred to Kuwait Energy’s announcements that this exploration contains high oil and gas reserves with lofty commercial importance and a promising develop in the oil production. Besides, it will positively reflect on the growth of revenue and the level of profitability. The newspaper also pointed out as well that the presence of two big Canadian and Australian companies in the same block.

The well was recently placed on the production line with a rate of 2500 barrels of oil per day; Kuwait Energy owns 700 barrels of it, located in Zahra area in Ras Qattara block.

It is worth mentioning that Kuwait Energy is a private company that was founded in 2005 as an independent entity for exploring and producing oil and natural gas in the Middle East and North Africa and considered one the most growing companies in the Middle East.

he Petroleum Ministry unites with GANOPE

2010-09-24T07:15:00.001-07:00

he Petroleum Ministry unites with GANOPE

Sameh Fahmy, the Egyptian minister of petroleum, has signed three new agreements. EGPC teamed up with GANOPE to sign the contracts in the Western Desert area. The primal deal between EGPC and Apache and Dana Petroleum, located in East Beni Suef, to add more exploration sessions with commitments of minimum spend of $12.5million, to drill more wells, and a Signature Bonus of $ 6 million. Mr. Thomas Voytovich, VP Region of Apache, and Mr. Brian Twaddle, Dana Petroleum Country Manager, were there to sign the deal on behalf of their companies.

The later agreement is in Faiyum district, between EGPC and Merlon Petroleum Company to add more search sessions with commitments of minimum spend of $ 24 million to drill six new wells, and a Signature Bonus of $3million. Eng. Moustafa Shaarawy, Merlon country manager, was there to sign the contract.

The final agreement was for GANOPE, which will drill for the first time in its history, in the area of Gilf Al-Kebir Al-Awinat in south west the Western Desert, with commitments of minimum spend of $8million including 2D seismic survey and to drill two new expletory wells. Eng. Sherif Ismail, CEO of Ganope, was there to sign the agreement.

Sureclean initiates its Egyptian base

2010-09-24T07:14:00.001-07:00

Sureclean initiates its Egyptian base

Sureclean, the international industrial cleaning and waste management firm, has announced expansion into the North Africa and Middle East region with the launch of a new base in Egypt to serve the Egyptian oil & gas industry.

Within days of the Sureclean facilities opening in Egypt, projects with major drilling contractors were secured for offshore cleaning and water-jetting services. Moreover, more than $2million has been invested in equipment for the region to ensure that the firm continues offering the same high levels of service to clients wherever in the world they operate.

“North Africa and the Middle East has emerged as an important growth market for Sureclean,” Paul McAlister, Sureclean business development director, said.

“Our presence in Alexandria and Cairo will ensure we have resources in place to meet the needs of the market. Winning our first contracts so quickly is a clear indication of the high demand there is for our services,’’ McAlister added.

He added: “Sureclean is about offering intelligent and environmentally-sensitive proven solutions. We are committed to investing in innovative technology and have established an unrivalled fleet of specialist equipment.”

To spearhead expansion in the region, Sureclean appointed Richard McDonald as Business Development Manager North Africa - a role that has also expanded to encompass the Middle East.

Mr McDonald said: “Following an intensive market due diligence process, on evaluation of the business and market challenges, Egypt was identified as the location for Sureclean to service the North Africa and Middle East territories, Establishing the regional base means we now have a multi-skilled team and innovative, high-specification equipment close to a range of existing and new customers. Most importantly we are winning orders and have a significant portfolio of pipeline business under negotiation.’’

In addition, Sureclean has formed a strategic alliance agreement with TIPCO who has operations in both North Africa and the Middle East.

Sureclean specialises in High Pressure (HP) and Ultra High Pressure (UHP) water jetting and its associated applications, tank and vessel cleaning, vacuum transfer and pumping, coating application, asbestos management, and waste handling and treatment solutions. Sureclean’s jetting technology can be used for a range of diverse applications including NORM decontamination, de-scaling, surface preparation, cold cutting and high pressure pumping operations both on and offshore.

Sea Dragon provides an operational update on Egypt‎

2010-09-24T07:12:00.000-07:00

Sea Dragon Energy Inc. provided the following update on its operations in Egypt in both NW Gemsa and Kom Ombo concessions.

NW Gemsa Concession

The Al Ola X-1 well spud on July 15th has now reached its total depth at 14,323 feet in the Nukhul Formation. The newly drilled section in the Rudeis Formation was logged and the well will now be cased to total depth. The Lower Rudeis Formation, where strong gas shows were encountered, is now being analyzed with the view of being tested prior to completing the well in the Kareem Formation. The Shagar and Rahmi members of the Kareem Formation were successfully encountered with 6 ft and 19 ft of oil pay respectively. No oil water contact was seen in this well and once tested and placed on production, it will result in extending the Al Amir SE development lease to the south of the existing boundary with the potential of significantly increasing the field reserves.

Production from the Al Amir, Al Amir SE and Geyad fields in the NW Gemsa Concession is holding steady at 9000-9500 bopd. Water flooding operations are now planned for the Al Amir SE and Geyad fields to provide pressure support and significant production increases. Cumulative production from the concession has now reached 3.3 million barrels of 41 degree API oil.

Sea Dragon has a 10% working interest in the NW Gemsa Concession with Vegas Oil at 50% as operator and Circle Oil Plc. with 40%.

Kom Ombo Concession

The Al Baraka SE step out well was spud on September 15th. The well is located some 4 km southwest of the Al Baraka No. 9 well and is intended to delineate the edge of the Al Baraka field. The well is scheduled to reach a total depth of approximately 8500 ft and will test all sands including the Kom Ombo Formation. Additional development wells and possibly an exploration well will be drilled following the completion of this step out well.

The completion/work-over rig, ECDC Rig 5 will soon commence completion operations on the Al Barak No. 9 well following its inspection and acceptance by the operator.

The Al Baraka field is now producing some 600-700 bopd gross. With the imminent arrival of the completion/work-over rig, production rates should soon begin to rise towards an expected year end exit target of some 2000 bopd.

Sea Dragon has a 50% working interest in Jointly Operated Kom Ombo Block with Dana Gas Egypt owning the remaining 50%.

Sea Dragon also announces the resignation of Mr. David Thompson as Director and Officer of the corporation for personal reasons. The company and staff wish to thank David for his significant contributions to our success over the past few years.

Commenting on these latest developments on our operations in Egypt, Company Chairman and CEO Mr. Said Arrata stated "We are quite encouraged by the continued success of the development drilling campaign in NW Gemsa and the anticipated rise in production and reserves from the planned waterflooding operations. The commencement of our completion and work over program in Al Baraka field should also result in a gradual increase in field oil production towards year end. I would also like to thank David on behalf of the Board of Directors for his guidance and wise counsel and wish him the best in his future endeavors".

Oil prices headed lower

2010-08-10T10:52:00.000-07:00

Oil prices headed lower

ingratiated itself with the lower price band for some time now closing below $73 a barrel in New York on Friday. There seems to be a melange of reasons at play for the price drop. First on the list- oil and gas prices have been rocked by the uncertainty about the extent of economic recovery.

The June job report, not on entirely unexpected lines, was grim with just 83,000 new private sector jobs added. Though lesser than anticipated it was better than the May figures when only 33,000 jobs were added. The unemployment figure did drop from 9.7 to 9.5 per cent-a modest gain, a gain nonetheless. However, analysts believe the drop happened as many people gave up their search for jobs.

On the whole, the job report indicates slow growth. The bearish job report didn't revive fears of recession but didn't offer any hope either. Soon after the jobs report, the price of U.S treasuries fell and the U.S stocks saw their worst week in two months. In Europe the shares closed higher though the German Bund futures fell. On Friday the Dollar fell against the Euro. The president expressed disappointment but said the nation was "headed in the right direction". He said, "We're not headed there fast enough for a lot of Americans," adding, "We're not headed there fast enough for me, either."

After nine consecutive months of northward march, factory orders declined in May-the sharpest since March-the commerce department announced on Friday. The orders for manufactured goods decreased 1.4 percent, the biggest since the March of last year. The departments said that demand for goods fell 2.1 percent. Both, the jobs report and the news from the manufacturing front, point to a slow recovery. The recovery is also an offshoot of the debt crisis in Europe- the governments in the region are moving to curb budget deficits through lower spending. The G-20 leaders have agreed, more or less, to deficit -reduction targets. Remember, a year ago it was times for a flurry of stimulus spending to avoid recession woes. Right now, the consumer confidence is low and so is the spending. Naturally, the demand is low for oil too.

Oil prices fell for the sixth consecutive trading session to jot the weakest price since June 9 with Crude oil dropping below the $73 a barrel in New York. The sweet crude for August delivery closed at $72.44 a barrel, down 4.1% at the New York stock, trading in the range of $75.40 to $72.36, heating oil was at $1.9155 a gallon losing 2.3 cents, and Natural gas settled for $4.687 per 1,000 cubic feet with a loss of 16.7 cents. In the ICE futures exchange, August North Sea Brent crude closed at $71.85 a barrel, 4.2 % lower. The tropical storm Alex, the first named one this hurricane season, didn't deter the oil prices as expected mid-week.

Further, demand for oil is low in China, the second largest consumer of oil. Goldman Sachs has cut its growth forecast for China to 10.1% from 11.4 % on the back of slow real estate growth and the Chinese governments macro regulation policies. The slower growth fear in China prompted fall in Asian stocks too. Earlier BNP Paribas, Macquarie Securities and China International Capital also cut the growth estimate for China.

On the same subject, the Purchasing Managers' Index for China, the world's no.2 economy based on purchasing power, showed slow growth in Chinese manufacturing, falling to 52.1 in June from 53.9 in May. According to National Bureau of Statistics, the drop in the PMI was 'grim' for exports and reflected the impact of policy tightening. Also, The PMI measure for the Eurozone too reported slow growth in the manufacturing sector, the weakest in four months at 55.6.

Why is demand so important?
The demand upturn was important as investors were hoping for a revival as the crude oil stockpiles in the US are above their five-year averages during summer. Last week, according to the Weekly Petroleum Status Report (WPSR), the commercial crude oil inventories decreased 2 million barrels from the previous week. Still, at 363.1 million barrels the inventories are above the upper limit for the average range for June. The gasoline inventories, meanwhile, increased by 0.5 million barrels, distillate inventories increased 2.5 million barrels while the total commercial petroleum inventories increase by 3.6 million barrels. With the advance of summer more people would be on the roads and the low oil prices would be good news for travellers. More Americans will be travelling for the fourth of July holiday weekend (July 1 to July 5) than last year, according to AAA. It has projected an increase of 17.1 percent from 2009, and estimates 34.9 million to take trips at least 5- miles from home. Last year, amid fears of recession, the figures were 29.8 million. The oil spill in the Gulf hasn't cast a spell on tourism, with the AAA predicting increase in travel to Gulf coast region by people visiting family, friends and the parks in the region. The oil extraction, already in process, will continue in Alberta, despite the present prices. But for future exploration prospects-not only for Alberta but across the world- the prices will have to be at the $80 per barrel range. Generally, if the dollar is high it leads to low oil prices. Any fall in the value of dollar, against a basket of currencies, reflects in the commodity prices including oil prices.

The dollar was at ¥87.45 from the 87 yen, the lowest this year for the dollar on Thursday. A weak dollar would reduce exploration activities. Why? Some of the companies pay their expenses-to import goods and services in Euro, and in local currency in different countries but sell oil in dollars. In such cases, the supply will be lower than demand which then increases the oil prices. But supply is high now, so the wait is on for the demand upsurge. On the brighter side, the commerce department has said that consumer spending rose modestly to 0.2 percent in May. This was better than expected hinting at an ongoing economic recovery which is good news for oil.

In a report Barclays Capital said, "We do expect the recovery to support crude oil prices ahead, once much of the doom and gloom mindset fades away, but a pervasive air of somewhat irrational nervousness still persists." Based on the given indicators, oil prices would remain in the $70-80 per barrel band range, in the near future.

bio oil

2010-07-28T21:04:00.000-07:00

bio oil

We've shown you how to make your own biodiesel before, and now there's a way to make oil, too (sort of). Bio-oil, more specifically, made from sawdust, wood chips, or just about any organic matter. Wired has a story about some researchers who, hoping to ease America's addiction to oil, have developed a process to create bio-oil that can be processed into fuels and chemicals. Bio-oil is produced through a process called pyrolysis, in which organic scrap materials are finely ground and heated at 400 to 500 degrees Celsius, without oxygen. In just two seconds, about 70 percent of the material vaporizes and is condensed into bio-oil; the end result looks surprisingly similar to petroleum. Though bio-oil is chemically very different from petroleum crude, it can be converted into a mixture of carbon monoxide and hydrogen known as "syngas," which can be processed into a high-grade hydrocarbon fuel, such as automotive diesel. Alternatively, the syngas can be combined with steam to produce pure hydrogen, which could be a handy helping hand for the burgeoning hydrogen economy. Looks a little complicated for a typical DIY, weekend project, but cool nonetheless

Disappointing data drags oil prices lower

2010-07-28T21:03:00.001-07:00

Story link: Disappointing data drags oil prices lower by Elaine Frei
Disappointing data drags oil prices lower

The price of crude oil fell Tuesday on disappointing data about consumer sentiment and home prices in the United States.
September contracts for West Texas Intermediate crude were down $1.97 to $77.01 per barrel in afternoon trade on the New York Mercantile Exchange, while Brent crude was last down $1.74 to $75.76 per barrel on the

oil news

2010-07-28T21:01:00.000-07:00

EIA: Crude stockpiles up 7.3 million barrels last week
Story link: EIA: Crude stockpiles up 7.3 million barrels last week by Elaine Frei
EIA: Crude stockpiles up 7.3 million barrels last week

Prices for crude oil were down again Wednesday after the US Energy Information Administration reported in its weekly inventories survey that stockpiles of crude were up unexpectedly last week.
The EIA said that crude oil inventories added 7.3 million barrels last week, against an expected decline of 2.3 million barrels, to a total of 360.8 million [...]

OPEC daily basket price stood at $73.95 a barrel Tuesday, 27 July 2010

2010-07-28T21:00:00.001-07:00

Vienna, 28 July 2010--The price of OPEC basket of twelve crudes stood at 73.95 dollars a barrel on Tuesday, compared with $74.22 the previous day, according to OPEC Secretariat calculations. (View Archives).

The new OPEC Reference Basket of Crudes (ORB) is made up of the following: Saharan Blend (Algeria), Girassol (Angola), Oriente (Ecuador), Iran Heavy (Islamic Republic of Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Qatar Marine (Qatar), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela).

Privacy Policy

2010-07-26T16:32:00.001-07:00

Privacy Policy for www.oil8.blogspot.com

If you require any more information or have any questions about our privacy policy, please feel free to contact us by email at 6smem.ahmed@gmail.com.

At www.oil8.blogspot.com, the privacy of our visitors is of extreme importance to us. This privacy policy document outlines the types of personal information is received and collected by www.oil8.blogspot.com and how it is used.

Log Files
Like many other Web sites, www.oil8.blogspot.com makes use of log files. The information inside the log files includes internet protocol ( IP ) addresses, type of browser, Internet Service Provider ( ISP ), date/time stamp, referring/exit pages, and number of clicks to analyze trends, administer the site, track user’s movement around the site, and gather demographic information. IP addresses, and other such information are not linked to any information that is personally identifiable.

Cookies and Web Beacons
www.oil8.blogspot.com does use cookies to store information about visitors preferences, record user-specific information on which pages the user access or visit, customize Web page content based on visitors browser type or other information that the visitor sends via their browser.

DoubleClick DART Cookie
.:: Google, as a third party vendor, uses cookies to serve ads on your site.
.:: Google's use of the DART cookie enables it to serve ads to your users based on their visit to your sites and other sites on the Internet.
.:: Users may opt out of the use of the DART cookie by visiting the Google ad and content network privacy policy at the following URL - http://www.google.com/privacy_ads.html

Some of our advertising partners may use cookies and web beacons on our site. Our advertising partners include ....
Google Adsense

These third-party ad servers or ad networks use technology to the advertisements and links that appear on www.oil8.blogspot.com send directly to your browsers. They automatically receive your IP address when this occurs. Other technologies ( such as cookies, JavaScript, or Web Beacons ) may also be used by the third-party ad networks to measure the effectiveness of their advertisements and / or to personalize the advertising content that you see.

www.oil8.blogspot.com has no access to or control over these cookies that are used by third-party advertisers.

You should consult the respective privacy policies of these third-party ad servers for more detailed information on their practices as well as for instructions about how to opt-out of certain practices. www.oil8.blogspot.com's privacy policy does not apply to, and we cannot control the activities of, such other advertisers or web sites.

If you wish to disable cookies, you may do so through your individual browser options. More detailed information about cookie management with specific web browsers can be found at the browsers' respective websites.

Egypt and Saudi plan oil spill exercise

2010-07-24T23:01:00.000-07:00

Egypt and Saudi state oil giant Aramco plan to launch an oil spill containment exercise in an Alexandria port in November, according to an Egyptian official.

The containment exercise comes after British oil company BP had a massive oil spill in the Gulf of Mexico on April 20.

The drill aims to test response to a big shipping spill in the Mediterranean Sea, Mahmoud Ismail, the head of the environmental disasters and crisis management at the Egyptian Environmental Affairs Agency (EEAA), told Reuters.

"We want to make sure that we have all the right equipment and people in place in the case of a disastrous spill, like the one BP had in the US," said Ismail.

Egypt's Petro Environmental Services Company (PESCO) and Aramco would launching the spill containment exercise in the Sidi Kerir area, around 30 kilometers west of Alexandria, he said.

Sidi Kerir is a Mediterranean oil terminal at the end of the Suez-Mediterranean (Sumed) twin pipelines, which can pump up to 3.1 million barrels per day (bpd) of crude from the Red Sea coast to the terminal. The pipeline is used by Middle East crude exporters including Saudi Arabia to by-pass the shipping chokepoint of the Suez Canal.

The drill would test the response to the worst kind of spill, called a tier three event that would require a full collaborative international response, Ismail added.

"Tier three basically means that both companies and national forces will be tested in how to deal with a disaster," he said.

Egypt's navy and ministry of defense and a number of state environmental agencies also plan to take part, said Ismail.

Other sponsors of the drill included BP, Royal Dutch Shell, Aramco's shipping subsidiary Vela, and Egypt's Arab Petroleum Pipeline Company (SUMED), said Richard Byrnes, manager for environmental services at PESCO.

"Although this exercise was scheduled to take place early on, after the BP spill it just seemed more important and we have had more interest from oil companies in the Gulf to take part," said Byrnes.

The cost of the exercise is estimated to around $1 million, Byrnes added.

In June, officials in Egypt's Red Sea resort of Hurghada discovered an oil spill that had polluted parts of a 20-km (12-mile) stretch of coastline including several tourist locations.

"The spill in Hurghada was small and was contained quite quickly, but the danger is if an accident like this happens in the Mediterranean then it would spread very quickly and would be harder to contain," said Byrnes.

egypt oil

2010-07-24T22:44:00.000-07:00

Abu Qir Petroleum Company initiated its first steps towards the drilling of two new wells, exploratory and development wells in North Abu Qir-10 and Center of Abu Qir respectively.

Diamond Offshore Drilling Inc and the Egyptian Drilling Company (EDC) supplied the project with the two needed 2000-hp rigs. The first company supplied its Ocean Spur rig, with a renting cost of $85,000 per day, and a rental period expiring this August, while EDC gave its Snuseret rig, with a daily rent of $55,000 and its ending period is in May of next year.

Egypt Oil & Gas newspaper (EOG) learned that the total value of the current wells drilling counts for $41 million.

The company targets a production boost from the North Abu Qir field by raising its current production from 175 billion cubic feet of gas per day to reach up to 300 billion cubic feet from the new marine platforms.

Besides, the company intends to conduct well's treatment over its exploratory wells, in order to be able to accommodate more new wells, whether exploratory or development ones, especially after the successful 3D seismic surveys that help boosting the North Abu Qir field reserve.

It is worth mentioning that Abu Qir Petroleum Company is a 50-50 joint venture company between the Egyptian General Petroleum Corporation and Edison. The company became operational following the signing of the January 15, 2009 agreement with the EGPC, through which Edison acquired all of the exploration, production and development rights to the Abu Qir field hydrocarbon deposits in Egypt through a production sharing agreement with EGPC.