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Showing posts from October 14, 2013

Dwindling International Interest in Nigeria's Onshore Oil Fields

Summary


Supermajors continue to sell onshore investments that are in sensitive areas in the Niger Delta, but a wider sell-off of other Nigerian hydrocarbon assets is unlikely. The Financial Times reported that a consortium led by Royal Dutch/Shell has put four blocks in the eastern Niger Delta region on sale as well as the Nembe Creek Trunkline pipeline, which connects those blocks to the Bonny export terminal. The report follows an internal review by Shell of its eastern Niger Delta assets, which account for about a third of Shell's energy assets in Nigeria, as a result of increased crude theft and pipeline damage in the region. Subsequently, on Oct. 10, Shell had to shut down the Trans-Niger Pipeline due to leaks caused by theft and pipeline damage for the third time in four months, highlighting the severity of disruptions in the region.

Onshore production problems -- due to both technical factors and militancy -- will remain as the Niger Delta continues to lose significance in…

China and the U.S. in a Changing Energy Landscape

Summary


China's growing dependence on foreign energy markets could force it to rethink its historical policy of nonintervention, at least in major energy producing regions. The U.S. Energy Information Agency released data Oct. 9 showing that China had officially passed the United States as the world's largest importer of oil. While the precise moment that the United States passed the torch to China is insignificant, the data highlights a growing trend that will continue over the next decade: The United States is becoming less of a global oil importer while China's appetite for oil imports is rising.

Analysis


Underlying the Chinese economic miracle has been the rapid growth in China's demand for all forms of energy. China is by far the world's largest coal consumer and is well on its way to passing the United States as the world's largest oil consumer. China's oil consumption rose from 2.3 million barrels per day in 1990 to 4.7 million barrels per day in 2000…