Posts tagged oil industry
Posts tagged oil industry
A federal court has given Chevron and Transocean 30 days to suspend all petroleum drilling and transportation operations in Brazil until investigations are completed into two oil spills off the coast of Rio de Janeiro.
The court said in a statement posted on Wednesday on its website that each company will be fined 500 million reals, or about $244m, for each day they fail to comply with the suspension.
About 155,000 gallons of oil crude began seeping from cracks in the ocean floor at the site of a Chevron appraisal well in November. Chevron has placed the amount of oil that leaked at 110,000 gallons.
Two weeks later, the National Petroleum Agency said the seepage was under control. But in March, oil again started leaking and Chevron voluntarily suspended production in the field.
“Two environmental accidents in the space of just four months and the lack of equipment needed to identify the origin of the leaks and contain them, shows that the two companies do not have the conditions necessary to operate the wells in an environmentally safe manner,” Judge Ricardo Perlingeiro said in his ruling.
Chevron said in an emailed statement it planned to appeal the court’s decision.
Norway government ends oil and gas strike
Norway’s government has used emergency powers to step in and force offshore oil and gas workers back to work, ending a 16-day strike.
Production was due to be shut down from Tuesday with companies set to lock out workers in a dispute over pensions.
“I had to make this decision to protect Norway’s vital interests,” Labour Minister Hanne Bjurstroem told Reuters.
She was speaking after a last-ditch effort was made to end the row between energy companies and trade unions.
The intervention means that the National Wages Board will facilitate “forced abritration” to end the row over retirement rights. It is unclear how long this process will take.
It means there will be no lockout of the 6,500 offshore energy workers and they will carry on working as normal.
“It wasn’t an easy choice, but I had to do it,” the labour minister said.
Leif Sande, the leader of the largest trade union Industri Energi, said workers would return to work immediately.
“It’s very sad. The strike is over,” he told journalists.
Pictured: Norway is the world’s fifth-largest oil exporter
Kirchner’s and Morales’s renationalisation of energy companies has been seen as mere populist demagoguery. But it was a response to toxic speculation
While Europe forces yet more privatisation on Greece and Spain under the Orwellian name of “liberalisation”, Latin America in 2012 is challenging the orthodox view that private always is better than public. On 1 May Bolivia seized the Spanish company that controlled its electricity grid, just after Argentina, on 14 April, effectively renationalised YPF, its main oil company, expropriating 51% owned by Spanish firm Repsol. Both critics and supporters have understood Cristina Fernández Kirchner’s and Evo Morales’s actions in terms of energy nationalism and populist demagoguery. But we should see both instead as responses to the failures of privatisation and its toxic connection to complex forms of financial speculation.
Bolivia and Argentina have both shown that private firms were investing less, not more, than their public predecessors were. Morales noted that only $81m had been invested in Bolivia’s electricity grid since privatisation in 1997. YPF in the 1990s drilled three times as many exploratory wells in Argentina as it did in the 2000s under Repsol. Argentina’s oil and gas output was falling, and new reserves were not being found to replace exploited deposits.
In both cases Spanish multinationals had prioritised the repatriation of dividends over investment. This indirect form of asset stripping was driven by the priorities of bankers in London and New York. Behind the Repsol-YPF affair, in particular, was something very close to the sick capitalism that caused the 2008 crisis: high-yield, high-risk assets, sliced and diced via complex derivatives.
Pictured: President Kirchner holds a sample of the first petroleum extraction in Argentina as she announces that YPF is subject to expropriation. Photograph: Daniel Garcia/AFP/Getty
Submitted by daliciously.
Argentinian president moves to nationalise Spanish-owned oil assets
President Cristina Fernández de Kirchner shocks oil industry by planning to seize 51% of Repsol’s Argentinian assets
Argentina sent shock waves through the oil industry by announcing plans to nationalise local oil assets controlled by a Spanish company, in a controversial move that threatens to sour the already troubled relationship between the two countries.
The move to seize 51% of Repsol’s YPF business in Argentina sent the company’s shares spinning down 18% on Wall Street and will worry other big foreign investors such as BP.
Cristina Fernández de Kirchner, Argentina’s president, introduced the new measure to Congress in a bid to recover sovereignty over its national hydrocarbon resources.
Kirchner accused Repsol of failing to produce enough oil through YPF to meet Argentina’s energy requirements. Repsol’s alleged failure threatened to “practically turn us into an unviable country,” Kirchner said. Economic and political interest in the country’s hydrocarbons has rocketed since the end of last year when YPF announced it had discovered a shale oil site that could potentially yield 1bn barrels.
Politicians have accused Repsol of failing to invest enough in future production at a time when the high cost of oil is undermining the country’s economy.
The nationalisation comes amid escalating threats against operators drilling for oil off the disputed Falkland Islands.
Argentina is expected to expropriate about 24% of YPF from Repsol and another 26% from Argentina’s Peterson Group at a price yet to be determined by the government.
Kirchner said the price would be set by the national appraisal tribunal and insisted the business could continue to be managed “professionally”. She said Argentina was one of the few countries that did not control its own oil.
Pictured: The Argentinian president, Cristina Kirchner, said YPF had not produced enough oil. Photograph: Pablo Porciuncula/AFP/Getty