Philippine President Benigno Aquino wakes up each morning with a question for which he has no answer: “There are very few days that I don’t start the day asking what does China gain from all this?”
The Obama administration’s upcoming greenhouse gas rules are gaining acceptance from an unlikely quarter -- power companies -- and splitting the energy industry’s normally unified opposition to new limits. The proposed regulations set for release on June 2 would mandate deep cuts in greenhouse-gas pollution while allowing smokestack emissions to be offset with enhancements elsewhere in the system, according to people familiar with the plan. Power company executives, while cautioning that they aren’t privy to the plan’s details, greet the Environmental Protection Agency’s promise of a flexible approach with sentiments ranging from eager endorsement to grudging acceptance. “Our goal is to work with EPA to make sure the rule works,” said Joe Dominguez, senior vice president of Exelon Corp. “There needs to be a pathway towards meaningful reductions.”
California, the second-most polluting state in the U.S., sold all 16.95 million carbon allowances at auction for $11.50 each. Units of Chevron Corp., Exxon Mobil Corp. and Royal Dutch Shell Plc were among the companies that qualified to purchase the permits put up for sale May 16, a report posted today on the state Air Resources Board’s website shows. The agency doesn’t disclose the names of buyers. The state received 1.46 bids for every permit offered. The allowances, each permitting the release of a metric ton of carbon, were offered as futures linked to them traded near a five-month low on speculation that the market will be oversupplied through at least 2020. State regulators approved additional free permits for polluters including natural gas utilities and oil refiners last month even as a record dry spell shrinks California’s hydropower generation, increasing demand for more emissions-intensive, gas-fired power plants.
China’s deal to buy natural gas from Russia after a decade of talks risks making tanker shipments of the fuel less competitive as new projects target Asian markets. The accord for supplies from eastern Siberia means liquefied natural gas export projects are less likely to be built as the additional Russian pipeline gas pressures prices, according to Societe Generale SA and Sanford C. Bernstein & Co. The agreement gives China greater leverage when negotiating LNG contracts, said Trevor Sikorski, head of natural gas, coal and carbon at Energy Aspects Ltd. in London, a consultant. “It could potentially have an impact on the volume of LNG that China needs to import and impact on the level of the spot price for LNG in Asia,” David Ledesma, an independent consultant who has been working in the LNG sector for more than 20 years, said yesterday in an interview in Amsterdam. China’s appetite for gas will double by 2018 as the world’s biggest energy user seeks to replace dirty coal-burning power plants, according to the International Energy Agency. LNG market tightness will start to disappear from 2015 with new supply, according to the Paris-based adviser to developed nations, after spot prices rose to a record in February.
Norway, western Europe’s largest oil producer, is angering a growing number of oil and gas producers after dictating terms for offshore projects worth billions of dollars.
Alstom SA chief executive officer Patrick Kron called on the French government to back a $17 billion offer by U.S. rival General Electric Co. for its energy units, saying uncertainty about his company’s future is making it difficult to win orders. “GE’s offer is an excellent option,” Kron told France’s National Assembly yesterday. The bid meets government concerns about France’s energy independence, local decision making and potential job cuts as there are almost no overlaps between the companies’ operations, he said.
Woodside Petroleum Ltd., Australia’s second-biggest oil and gas producer, scrapped an agreement to buy a quarter of Israel’s largest natural gas field for as much as $2.6 billion after talks to complete the deal collapsed. “Negotiations between the parties failed to reach a commercially acceptable outcome,” the Perth-based company said today in a statement. Woodside had been in talks with a group including Noble Energy Inc. to invest in the Leviathan venture. A deal would have put Woodside in the middle of Israel’s nascent natural gas industry as the company’s proposed projects in Australia face delays. Woodside last year ditched plans to build its Browse gas project onshore in Australia, estimated to cost more than A$80 billion ($74 billion).
The U.S. dramatically escalated its battle to curb China’s technology theft from American companies by accusing five Chinese military officials of stealing trade secrets, casting the hacker attacks as a direct economic threat. The indictment effectively accuses China and its government of a vast effort to mine U.S. technology through cyber- espionage, stealing jobs as well as the innovation on which the success of major global companies like United States Steel Corp. and Alcoa Corp. depends. While hundreds of U.S. entities have been penetrated by Chinese military hackers since 2002, the Justice Department focused on five companies specialising in solar panels, metals and next-generation nuclear power plants. Four companies are headquartered or have main offices in Western Pennsylvania and officials calculated the toll in human terms.
BP Plc faces billions of dollars in additional payments after failing again to convince an appeals court that the company is being forced to pay claims that aren’t directly related to the 2010 Gulf of Mexico oil spill. The decision leaves BP with two options -- pay claims the company has called “fictitious,” or appeal further to the U.S. Supreme Court. Paying these claims will cost additional billions of dollars, BP has said in court filings. Payments for disputed business economic losses have been on hold while BP appealed.
The European Union is seeking an agreement by the end of May on the price Ukraine pays for Russian natural gas as the threat of supply disruptions in Europe looms.
Shale explorer Cuadrilla will seek planning approval this month for an exploration well in northern England, a “milestone” in its efforts to bring the technology to the UK.
Two boats arrived in Vietnam to collect Chinese citizens as Vietnamese authorities thwarted anti-China protests after violent demonstrations resulted in two deaths and damage at factories.
A Libyan military police chief said he disbanded parliament after a militia group he backs stormed it yesterday, spreading violence in the energy-rich nation to its capital and sending world oil prices higher. In a televised speech late yesterday preceded by clashes, Mukhtar Fernana said parliament will be replaced by a 60-member group. Nuri Abu Sahmain, the head of the General National Congress, denied that it had been suspended and said yesterday he was running it from a “safe place,” the state-run Libyan News Agency reported. Fernana said he won’t allow Libya to become a safe-haven for extremists or a “home for terrorists.” The assault, he said, was not a coup and reflects the “freedom that Libyans wanted and fought for.”
Norwegian opposition parties will force Statoil and other companies to power four North Sea oil fields from land, risking further delays to the country’s biggest offshore development in decades.
Norwegian lawmakers pressuring oil companies to power North Sea fields from land in an attempt to cut greenhouse-gas emissions risk thousands of jobs by delaying the country’s biggest offshore project in years, Aker said.
China, the world’s biggest carbon emitter, plans to speed up solar power development, targeting a more than tripling of installed capacity to 70 gigawatts by 2017 to cut its reliance on coal. The goal would be double a previous target set for 2015, according to a statement posted today on the National Development and Reform Commission’s website. China also plans to have 150 gigawatts of installed wind power capacity by 2017, 11 gigawatts of biomass power and 330 gigawatts of hydro power. The plans come as the nation strives to get 13 percent of the energy it consumes from non-fossil fuels. Deadly pollution has forced the government to declare war on smog.
Det Norske Oljeselskap ASA should buy assets to boost output and will have to issue shares to develop the biggest Norwegian oil find in decades, according to its biggest owner, billionaire Kjell Inge Roekke’s Aker ASA. Det Norske has a stake in two of three North Sea licenses holding the Sverdrup field, which could be the biggest oil discovery off Norway since Statfjord in 1974, holding as much as 2.9 billion barrels of oil equivalent. The field’s owners, which include Statoil ASA and Lundin Petroleum AB, said in February that the first phase of the field’s development will cost as much as 120 billion kroner ($20.2 billion).
France beefed up tools that allow it to block foreign investment in areas that are key to the country after General Electric Co. offered $17 billion for Alstom SA’s energy units and Germany’s Siemens AG considers a rival bid.
A fire at a Turkish coal mine has killed 201 people and lingering smoke is hampering rescue workers from searching for hundreds more miners trapped underground, authorities and television stations said today.
When Mexican President Enrique Pena Nieto arrived at the March 18 rally, he was greeted like a rock star. Hundreds of local residents and employees of Petroleos Mexicanos had gathered in the eastern state of Veracruz for the annual celebration of the 1938 expropriation of foreign oil wells and the founding of Pemex. The workers, all dressed in white shirts and guayaberas bearing the Pemex logo, leaned over waist-high barriers to try to touch the photogenic president. An outsider would never have guessed that, just three months earlier, Pena Nieto, 47, had signed into law a constitutional amendment that Pemex, its powerful union and its political backers had fought against for decades. The amendment opens up Mexican oil and gas fields to foreign and private investment for the first time in 76 years.
Anti-China protests sparked by the placement of an oil rig in disputed waters off the Vietnamese coast damaged factories, with some plants closing and China’s embassy in Hanoi advising its nationals to minimize outings.
Oil-service unions in Norway said wage negotiations may reach an impasse that could trigger a strike.
EON, Germany’s biggest utility by market value, said first-quarter profit fell 13% after power prices dropped and disposals reduced revenue.
Chile is gambling on overcoming a looming energy crisis in the biggest copper-producing country by generating more power with U.S. shale gas, just as prices of the fuel are rising.
Baytex Energy Corp., bidding for Aurora Oil & Gas Ltd., sweetened its cash offer for the Australian company to A$1.9 billion ($1.8 billion), winning the backing of the target’s two biggest shareholders.
