Exxon inks Rosneft Arctic deal

(Arabian Oil and Gas) -- BP's ambition to become a major player in the Russian arctic has been thwarted after ExxonMobil announced it had sealed an agreement with Rosneft for the exploration of giant offshore deepwater fields.


The Exxon-Rosneft deal, valued at USD 3.2 billion, will see the US supermajor assist Rosneft with the exploration of offshore fields in Russia's Kara and Black Seas in return for options for the Russian firm to acquire interests in oil projects in Texas and the Gulf of Mexico.


The three Arctic blocks up for exploration contain reserves of 36 billion barrels, according to the Financial Times. While BP offered a 5% stake in their company as a whole instead of options on defined production blocks, the Exxon deal bears a strong resemblance to that initially agreed with the British supermajor, down to the foundation of an Arctic research centre staffed by both companies.


MRC

Lukoil posted USD 6.7 billion in net income for the first half of 2011

(Arabian oil and gas) -- Russian international oil company Lukoil has posted USD 6.7 billion in net income for the first half of 2011, an increase of 69.1% over the same period in 2010. Bumper profit resulted from consistently high oil prices over the first six months of the year, which more than compensated for the firm's 4.4% reduction in overall production to 2.1million barrels of oil equivalent per day in the same period and higher production costs per barrel.


EBITDA in the first half of 2011 was USD 10,688 million, up is 43.8% year-on-year, with sales revenues of USD 64,538 million.


In the first half of 2011, lifting costs per boe of production were $4.72, which is 17.4% higher year-on-year. The growth was mainly due to the real ruble appreciation, which was 15.0% in the first half of 2011.


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The Libyan NTC hopes to restart oil production "within days"

(Arabian oil and gas) -- Anti-Gaddafi forces have not yet cracked the Libyan dictator's stronghold of Sirte, the Colonel remains at large apparently within the country, and oil infrastructure remains ablaze, but the Libyan NTC hopes to restart oil production "within days", according to Ali Tarhouni, the NTC's oil minister.


"In the next few days we expect a lot of oil wells will be rehabilitated," Tarhouni told Reuters. Tarhouni has not specified which wells will come back on line so soon or whether they will be used to meet domestic demand or be used for cash-raising exports.


International Oil Companies have made it clear that they aim to return to Libya under their pre-war contracts as soon as possible, with Italian firm Eni stating that the recently-repaired major Greenstream gas export pipeline to Italy will be running again by mid-October, and Spanish firm Repsol saying production at their fields could restart within weeks.


However, concerns remain over security, after several oil fields have been found to have been planted with land mines by retreating Gaddafi forces.


MRC

Sinopec and a Taiwan consortium to build a petrochemical complex in Fujian

(Plastemart) -- Sinopec Group, the Fujian provincial government and a Taiwan consortium have signed a framework agreement to build a US$4.5 bln petrochemical complex in Fujian, as per Reuters. The complex, to be located in Gulei of Zhangzhou city, has been initially designed to have crude refining capacity of 16 mln tps (320,000 bpd) and ethylene production capacity of 1.2 mln tpa. The project needs government approval. If approved, the project would be the largest investment by Taiwan in the oil sector in mainland China. It would also be the third major refinery in Fujian province after a 240,000 bpd joint venture by Sinopec, Saudi Aramco and ExxonMobil and a 240,000 bpd refinery planned by China's Sinochem Corp.


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Initial US ethylene settlements for August down by 1.25 cents/lb

(ICIS) -- Initial US ethylene settlements for August were agreed at 55.50 cents/lb (USD 1,224/tonne, EUR 857/tonne), down by 1.25 cents/lb from July, market sources said on Thursday.
The 2.2% reduction resulted from a drop in production costs last month, which offset an increase in average ethylene spot prices.


July ethylene settled at 56.75 cents/lb, as assessed by ICIS.The initial drop for August surprised some market participants, who had expected a smaller decline for the month. A larger drop was needed to keep US ethylene derivatives competitive in the export market, a source said.


US ethylene contracts usually settle at the beginning of the month for the previous month.
Spot ethylene for September traded on Thursday at 63.50 cents/lb, flat with a deal on Wednesday.
Major US ethylene producers include Chevron Phillips Chemical, ExxonMobil, INEOS, LyondellBasell and Shell Chemicals.


MRC