Jan. 1 A Turkish newspaper reports an agreement between Turkey and Iran to build a pipeline to carry Iranian oil from the Caspian Sea to Turkey's Mediterranean port of Ceyhan. The agreement also includes a pipeline to carry natural gas from Turkmenistan through Iran to Turkey. No details are provided. This is the latest in a series of Turkish-Iranian initiatives (including a $20 billion natural gas deal and several trade agreements) which have been criticized by the United States due to Iran's links to terrorism. (NYT)

Jan. 2 A Russian tanker carrying 19,000 tons of heavy oil breaks apart and sinks in rough seas in the Sea of Japan. Japanese helicopters sight an oil slick about 1 mile long and 90 yards wide located about 375 miles west of Tokyo. The tanker, Nakhodka, was en route from Shanghai, China to Russia's Kamchatka Peninsula. (DJ)

Jan. 3 President Clinton suspends for another six months a U.S. law, the Helms-Burton Act, which would allow Americans to sue foreigners who are doing business in Cuba on property confiscated from Americans. (DJ)

Jan. 3 The New York Mercantile Exchange posts its first long-term, forward contracts for crude oil, covering delivery as far out as December 2003. There are no takers. (DJ)

Jan. 6 Saudi Arabia reports a discovery of new reserves of super light crude oil in the central region, near Riyadh. According to Oil Minister Ali Naimi, this is the seventeenth such discovery in the area. Further assessments to determine potential reserves are planned. (DJ)

Jan. 6 Iraq informs its customers that it will reduce its contractual crude oil sales volumes in order to stay within the $1 billion limit for the first 90 days of the United Nations' oil-for-food agreement. (DJ)

Jan. 7 The United Nations approves three more contracts for the sale of Iraqi oil, bringing to 24 the total number of contracts approved so far under the oil-for-food agreement. (DJ)

Jan. 7 A Salomon Brothers' survey of 228 oil and natural gas companies worldwide indicates exploration and development spending will increase to $81.4 billion in 1997, up 14.7 percent from $71 billion in 1996. This is described as the "strongest outlook for oil service demand" in the 15 years of the survey. Of the total, 62 percent of the investment is planned outside North America, 28 percent in the United States, and 10 percent in Canada. (PON)

Jan. 7 Algeria's Prime Minister, Ahmed Ouyahya, claims his country's proven oil reserves have recovered to their 1971 level (9.84 billion barrels, according to Organization of Petroleum Exporting Countries statistical sources). (PON)

Jan. 7 A senior official of the China National Petroleum Company, China's state onshore oil and gas producer, says China plans to double its natural gas production capacity to almost 1.1 trillion cubic feet per year by 2005. To meet this goal, China has set a target to add 35 trillion cubic feet of verified onshore reserves by 2000. Primary areas of exploration are the Shaanxi-Gansu-Ningxia region, the Tarim Basin, and Sichuan province -- whose combined total proven reserves are estimated to be at least 20.8 trillion cubic feet. (PON)

Jan. 10 Russia's Gazprom approves a $2.5 billion project to build the world's deepest underwater natural gas pipeline (about 6,900 feet below the surface) linking Russia and Turkey via the Black Sea. A feasibility study will be completed in the second quarter of 1997. (EA)

Jan. 10 Freezing weather disrupts shipments of petroleum products on Europe's inland waterways. Major areas affected include the Dutch canal system and waterways in Belgium, France, and the Netherlands that connect to the Rhine River. (DJ)

Jan. 15 U.S. Deputy Treasury Secretary Lawrence Summers announces that Mexico's oil receipts are now free of U.S. claims, as a result of its early repayment of $5 billion in debt to the United States and the International Monetary Fund. The country's oil revenues had guaranteed the U.S. loan. (DJ)

Jan. 16 Qatar Liquefied Gas Company (Qatargas) starts up a second production line, with output capacity of 2.0 million tons per year of liquefied natural gas. (DJ)

Jan. 16 Oil from a wrecked Russian tanker in the Sea of Japan penetrates oil fences set up around two nuclear power plants belonging to Japan's Kansai Electric Power and Hokuriku Electric Power. A preliminary investigation indicates the tanker, which broke up and sank in the Sea of Japan on January 2, collided with a "half-submerged object". (DJ)

Jan. 18 Iraq agrees to export 25 million barrels of crude oil and 7 million barrels of petroleum products to Jordan in 1997. The total, which equates to 88,000 barrels per day, is 7 percent more than in 1996. Jordan relies entirely on Iraqi crude oil, which is shipped under a special exemption from United Nations' sanctions against Iraq. Part of the oil is paid for at a reduced price ($19.10 per barrel in 1997, 25 percent higher than in 1996) and the rest of the oil goes toward reducing Iraq's $1.3 billion debt to Jordan and paying for Jordanian exports of food and medicine to Iraq (slated to increase by 17 percent to $255 million in 1997). (DJ)

Jan. 21 Yemen signs a final agreement endorsing the participation of a foreign consortium, Gas General, in its $4.2 million project to produce 5 million tons per year of liquefied natural gas. Participants include Total (36 percent), Hunt Oil (15.3 percent), Exxon (14.3 percent), Yukong (8.4 percent), and the Yemen government (26 percent). (EA)

Jan. 21 Japan's Prime Minister Ryutaro Hashimoto concedes that his government misjudged the seriousness of the January 2, 1997 oil spill in the Sea of Japan and announces an all-out effort to prevent further damage. Cleanup has been complicated by heavy seas and by the nature of the oil, a specially refined distillate destined for use in Siberia, which did not coagulate in cold waters as expected. Fishermen and environmentalists describe the spill as a major ecological disaster and Japan's worst oil spill in 20 years. (WP)

Jan. 21 Statoil, Norway's state-owned energy company, announces an agreement to supply 5.3 trillion cubic feet of natural gas to Italy under a 25-year contract between Norway's Gas Negotiating Committee (representing Statoil, Norsk Hydro, and Saga) and SNAM, a unit of Ente Nazionale Idrocarburi (ENI). The contract, valued at nearly $14 billion (at current prices), provides for initial delivery of 71 billion cubic feet in 2000. Annual contract volumes would increase to 212 billion cubic feet in 2002, and could be increased an additional 71 billion cubic feet in each subsequent year. Norway is currently the second largest source of natural gas for Europe (after Russia's Gazprom). (WSJ)

Jan. 22 President Fidel Ramos orders full deregulation of the Philippine oil industry effective February 8, 1997, nearly a month ahead of the established deadline. (DJ)

Jan. 22 Libya officially notifies the United Nations that it will resume international flights in violation of United Nations' sanctions. (DJ)

Jan. 22 A senior Qatari official announces plans to increase Qatar's combined crude oil and condensate output capacity to 910,000 barrels per day by 2000. Current capacity is about 510,000 barrels per day. (REU)

Jan. 23 An explosion and fire on the Iraq-Turkey oil pipeline in southern Turkey damages the unused portion of the line, but the line currently in use (carrying an estimated 440,000 barrels per day) is undamaged. Kurdish guerillas are blamed for the attack. (EMC)

Jan. 24 The U.S. Minerals Management Service (MMS), part of the Department of the Interior, proposes a new regulation that would revise how federal royalties are calculated on oil produced from federal lands. Under the proposed regulation, royalties would be based on a monthly average of futures prices at the New York Mercantile Exchange, except for oil produced in California or Alaska (which would be based on prices for Alaska North Slope crude oil). MMS would adjust the market prices to account for differences in quality and location. Currently, royalties are based on the posted (wellhead) prices of the oil. (WP)

Jan. 28 The official Iraqi News Agency (INA) reports that Iraq has exported a total of 11.5 million barrels of crude oil from its Persian Gulf terminal of Mina al Bakr since it began selling oil under the United Nations' oil-for-food deal in December 1996. (PON)

Jan. 29 The Clinton Administration refutes news reports that Iraq is threatening its neighbors, but restates the U.S. willingness to act if Iraq does become aggressive. The statement is in reaction to speculation following reports that Saddam Hussein's wife has been placed under house arrest and his son risks losing a leg to gangrene in the wake of a previous assassination attempt. March light, sweet crude oil futures prices settle sharply higher on the New York Mercantile Exchange (up 57 cents, to $24.47 per barrel). (DJ)

Jan. 29 Amoco and Shell Deepwater Development (Shell) announce plans to jointly develop a deepwater Gulf of Mexico oil and natural gas discovery known as the Marlin prospect. The prospect is located in 3,240 feet of water and will cost $500 million to develop. It is expected to produce 250 million cubic feet of natural gas per day and 40,000 barrels of oil per day by 1999. Amoco owns 75 percent of the prospect and Shell owns the remaining 25 percent. (DJ)

Jan. 29 Leftist rebels are suspected of being responsible for an explosion on a section of Colombia's main oil pipeline that causes a spill of about 5,000 barrels of crude oil and forces the first suspension of pumping on the pipeline this year. (REU)

Jan. 30 United Nations' Secretary General Kofi Annan states he expects Iraqi oil exports under the oil-for-food deal to continue through the year after an anticipated renewal of a six-month agreement at mid-year. (DJ)

Jan. 30 Venezuela's state-owned oil company, Petroleos de Venezuela S.A. (PDVSA), announces that 259 companies have qualified to participate in its third auction of operating contracts for mature and marginal oil fields, scheduled for May 1997. According to PDVSA's estimates, the fields included in the 20 contracts hold reserves of between 2 billion and 3 billion barrels and output is expected to reach 300,000 barrels per day by 2006. (HOH)

Jan. 30 A United Nations' spokesman announces that disbursements from the escrow account set up under the Iraqi oil-for-food plan have begun. The fund is expected to total $239 million by the end of the day. (DJ)

Feb. 5 The Energy Policy Committee of the U.S.-Russian Joint Commission on Economic and Technological Cooperation (the Gore-Chernomyrdin Commission) meets in Washington to review progress in U.S-Russian cooperation, including improvements in the foreign investment climate in the Russian oil sector. Other topics of discussion include nuclear nonproliferation; nuclear reactor safety and peaceful uses of nuclear technologies; the development of power projects, including for Russia's northern territories; and progress in energy efficiency. (DOE)

Feb. 5 Japan's Ministry of Finance announces plans to cut import tariffs on crude oil and most petroleum products from April 1, 1997, in a phased process that will reduce the country's crude oil import tariff rate to zero in April 2002. (DJ)

Feb. 6 President Clinton formally unveils a fiscal 1998 budget plan, which includes a proposal to raise $1.35 billion over the next 5 years with the sale or lease of crude oil from the Strategic Petroleum Reserve. (DJ)

Feb. 6 The United Nations reports that it so far has received a total of $343 million in proceeds from Iraq's oil-for-food sale. (DJ)

Feb. 10 Lukoil, Russia's largest oil company, and the U.S. energy company Arco enter a $5 billion, 18-year joint venture to prospect for and develop oil in the former Soviet Union. Lukoil's share is 54 percent and Arco's is 46 percent. The venture, called Lukarko, plans investment of $400 million in 1997. Initial projects include a 12 percent stake in the Caspian Pipeline Consortium and a 5 percent share of the Tengiz field in Kazakhstan. (HOH)

Feb. 10 South Africa's deputy-minister of mineral and energy affairs indicates that South Africa will complete the restructuring of its oil industry by the end of 1997. (DJ)

Feb. 11 Woodside Petroleum receives approval from the Australian government to proceed with the $1 billion Laminaria development in the Timor Sea. The project will employ the world's biggest floating production, storage, and offloading facilities to produce 170,000 barrels per day of oil beginning in 1999. Crude oil reserves are estimated at 130-250 million barrels. Woodside's partners in the development are Broken Hill Proprietary (25 percent) and Shell (25 percent). (HOH)

Feb. 11 In a special report, the International Energy Agency (IEA) predicts major increases in oil and natural gas production capacity in Algeria, Libya, and Egypt. Between 1995 and 2000, the IEA reports that Algeria is projected to increase its crude oil production capacity by 25 percent (to at least 1.0 million barrels per day) and its natural gas production capacity by 58 percent (to 3 trillion cubic feet annually). Libya will increase its crude oil production capacity by 18 percent (to 1.65 million barrels per day) and maintain natural gas production capacity at 667 billion cubic feet annually. Egypt will increase its crude oil production capacity by 11 percent (to 1.0 million barrels per day) and its natural gas capacity by 76 percent (to 1.2 trillion cubic feet annually). Natural gas liquids production will also increase in all three countries. In addition, the IEA projects that Algeria's natural gas export capacity will reach 2.9 trillion cubic feet and Libya's 159 billion cubic feet, representing increases of 123 percent and 41 percent respectively, compared with 1995 capacities. (DJ)

Feb. 12 A U.S. admiral headquartered in Bahrain reports that tankers are smuggling tens of thousands of tons of fuel oil out of Iraq in violation of United Nations' sanctions by reportedly skirting the shoals of Iran's coast, apparently with Iranian approval. (WSJ)

Feb. 12 A spokesman for Ecopetrol, Colombia's national oil company, announces a suspension of drilling in the Coporo field, which had been hailed as one of the most promising in the country's history (with 700 million to 1.5 billion barrels of oil reserves). A company report indicates difficulties in extracting the oil due to low permeability and low pressure. (DJ)

Feb. 12 The Norwegian Oil Directorate announces it has upgraded its estimate of total extractable oil and natural gas reserves on Norway's continental shelf by 16 percent, to 78.6 billion barrels of oil equivalent. (DJ)

Feb. 12 Petroleos Mexicanos (Pemex) announces plans to invest $5.92 billion in 1997 to boost Mexico's oil and natural gas production and upgrade operations (a 70 percent increase from 1996). Pemex plans to increase production to 3.08 million barrels per day of crude oil and 4.55 billion cubic feet per day of natural gas. (HOH)

Feb. 13 Exxon files documents with the U.S. District Court in Anchorage, Alaska, in an appeal of that court's $5.06 billion amended final judgment on the 1989 Exxon Valdez oil spill, which spilled 11 million gallons of crude oil into Prince William Sound. (DJ)

Feb. 13 The Congolese government announces plans to liberalize -- and eventually privatize -- the downstream activities of the country's petroleum sector. To participate, private-sector companies will need to obtain approval from the Congolese government. (DJ)

Feb. 13 Canadian crude oil begins flowing through the new Express Pipeline to Casper, Wyoming. Originating in Hardisty, Alberta, the pipeline interconnects at Casper with the Platte Pipeline to transport oil to Wood River, Illinois and other points in the U.S. Midwest and Southeast. Commercial service on the 172,000-barrel-per-day pipeline is scheduled to start April 1. (DJ)

Feb. 14 Australia's Broken Hill Proprietary receives formal approvals to proceed with the development plan and environmental assessments for developing the first two oil fields in the Timor Sea Zone of Cooperation, an area jointly administered by Indonesia and Australia. The two fields (Elang and Kakatua) contain estimated commercial oil reserves totaling 15 million barrels and are expected to begin producing in the third quarter of 1998. (DJ)

Feb. 17 Australia's Woodside Petroleum announces a significant increase in natural gas and condensate reserves from acreage held by the North-West Shelf venture. As of December 31, 1996, the total proved raw gas ultimate recovery is estimated at 24.4 trillion cubic feet, 60 percent higher than the previous year's estimate, and the proved condensate ultimate recovery is estimated at 690 million barrels, an 18-percent increase. The project is a joint venture shared equally among Woodside and its five partners: Broken Hill Proprietary, Chevron, Royal/Dutch Shell, British Petroleum, and Japan Australia LNG. (DJ)

Feb. 17 The Middle East Economic Survey reports that Iraq's State Oil Marketing Organization is increasing crude oil sales to reach its targeted $1.0 billion in sales for the first 90-day period under the United Nations' oil-for-food plan. The total value of contracts for the first 90 days is reported to be $800-$850 million, lower than expected due to lower oil prices (14 percent less than when the sale was announced in mid-December 1996) and the failure of Russian companies to lift contracted volumes. (DJ)

Feb. 17 Raul Baca, Ecuador's new energy minister, suspends the bidding process announced by the previous government to build a new 246,000-barrel-per-day pipeline for heavy crude oil, due to "serious indications of illegalities." (DJ)

Feb. 18 A Colombian public workers' strike, in effect since February 11, ends when the government reaches an agreement with labor representatives, which reportedly includes a promise not to privatize state-held oil and telecommunications companies. The strike, which included 5,000 oil workers, had forced the shutdown of one of the state oil company Ecopetrol's gasoline plants in Barrancabermeja, the country's main hydrocarbons processing center. (DJ)

Feb. 18 Presidents Eduard Shevardnadze of Georgia and Heydar Aliyev of Azerbaijan sign a package of 22 cooperation agreements. They include: 1) an agreement for Azerbaijan to supply natural gas to Georgia; 2) an agreement on an oil pipeline from Azerbaijan across Georgia to the Black Sea port of Batumi; 3) an agreement calling for closer cooperation between the two countries' state oil companies; and 4) an agreement under which Azerbaijan will ship 4.4 million barrels of oil by railroad through Georgia in 1997. (DJ)

Feb. 19 Conoco announces that the United Kingdom Department of Trade and Industry has approved development of the North Sea's Banff oil field, following a 6-month production assessment which maintained a production rate of about 35,000 barrels per day. Discovered in 1991, the Banff field contains recoverable reserves of approximately 60 million barrels of oil (38 to 39 degree API gravity) and around 39 billion cubic feet of associated gas. Start-up is scheduled for June 1998. Conoco holds a 31.7-percent share of the venture and will operate the field. Conoco's partners are Enterprise Oil (27.9 percent); Ranger Oil (26.2 percent); Hardy Exploration & Production (12.4 percent); and Santos Europe (1.8 percent). (DJ)

Feb. 19 Deng Xiaoping, China's retired senior leader and architect of the country's economic reforms, dies at the age of 92. It is generally believed that his death will not have an immediate impact on China's economy, including its oil and petrochemical industries, as the retired leader had not played an active role in recent years. (DJ)

Feb. 20 U.S. Air Force officials announce the deployment of 30 warplanes and more than 1,000 airmen in Qatar to help train the emirate's Air Force and to enforce the no-fly zone over southern Iraq, that was established in 1991 after Iraq crushed a rebellion by Shiite Muslims following the Gulf War. (DJ)

Feb. 21 Cameroon's president Paul Biya officially inaugurates the Ebome offshore oil field, the country's second largest. The field began production on January 12 and is expected to produce up to 12,000 barrels per day. (DJ)

Feb. 21 China's official news service reports that China National Petroleum Corporation expects to produce 88,000 barrels per day of crude oil from Tarim Basin oil fields in the country's northwest in 1997, up from 63,000 barrels per day in 1996. (DJ)

Feb. 24 Romania announces plans to privatize 62 large state companies by the end of 1998, including oil refineries and energy distributors. (DJ)

Feb. 24 Russia oil giant AO Lukoil, citing an audit of its holdings, claims to have the largest proven oil reserves (10.77 billion barrels) of any company in the world. The estimate includes 7.927 billion barrels in Lukoil's main fields in Western Siberia and 2.85 billion barrels in European Russia. The company's natural gas reserves in European Russia are reportedly 1.0878 trillion cubic feet. (DJ)

Feb. 24 Qatar inaugurates the world's largest liquefied natural gas (LNG) exporting facility and formally launches Qatar Liquefied Gas Company, which will have total output capacity of 6 million tons per year of LNG. The facilities are part of a new $7.2 billion industrial zone which also includes a seaport with a capacity to handle 25-30 million tons of LNG annually. Qatar plans to build more gas liquefaction plants in the area to exploit its natural gas reserves of around 237 trillion cubic feet. (DJ)

Feb. 25 A senior oil official in Qatar reports that Qatar General Petroleum Corporation has approved a $5.0 billion, 5-year oil drilling program aimed at increasing oil production capacity to around 700,000 barrels per day (currently around 550,000 barrels per day). The goal is to spud 202 offshore wells, including 69 wells at the Al Shaheen oilfield. Plans include opening three new oil blocks and awarding development and production sharing agreements to foreign oil companies. (DJ)

Feb. 25 Azerbaijan's parliament ratifies a $2 billion oil development project in the Caspian Sea -- the country's fourth major oil exploration contract with foreign companies. The 25-year production-sharing contract, first signed in December 1996, covers development of the Dan Ulduzu and Ashrafi oil fields. Partners are Amoco (30 percent), Unocal (25.5 percent), Itochu (20 percent), Azerbaijan's state oil company (20 percent), and Delta Nimir of Saudi Arabia (4.5 percent). (DJ)

Feb. 25 Amoco signs an agreement with Shell Oil to form a limited partnership called Altura Energy Limited, which will operate the combined oil and natural gas producing assets of the two companies in the greater Permian Basin area of west Texas and southeast New Mexico. The new company (64 percent Amoco, 36 percent Shell), which begins operations on March 1, will be the largest oil producer in Texas and the third largest independent oil producer in the United States, according to Amoco officials. In 1996, Altura's 6,300 wells produced roughly 170,000 barrels per day of oil and 220 million cubic feet per day of natural gas. (DJ)

Feb. 27 Russia's State Property Committee approves a privatization plan for AO Rosneft, the country's last major oil company that is still entirely in state hands. Rosneft was among the last of the integrated oil companies the government formed from once-independent production, refining, and marketing enterprises. In 1996, the company produced 261,000 barrels per day of crude oil and refined 95,000 barrels per day of crude oil. (DJ)

Feb. 28 Turkey's national pipeline company Botas receives 14 bids for the construction of a 162-mile natural gas pipeline from the Iranian border to the Turkish city of Erzurum. Iran will also build a 172-mile natural gas pipeline from its Western city of Tabriz to the Turkish border. Each pipeline is expected to cost $200 million. Turkey has agreed to buy 10 billion cubic feet of natural gas annually from Iran beginning in 1998, with volume increasing to 33 billion cubic feet annually by 2005. (DJ)

Feb. 28 Russian gas producer and distributor RAO Gazprom agrees to the terms of an 8-year, $2.5 billion syndicated loan from 19 international banks. The loan, which is backed by revenues from Gazprom's gas exports to Europe, will pay for the construction of Gazprom's planned Yamal-Europe pipeline to western and central Europe. (DJ)

Feb. 28 The United Nations announces the approval of the 35th contract for the sale of crude oil under Iraq's oil-for-food program. The contract is for delivery during the second 90-day period of the sale, which begins March 10. To date, about $900 million of oil has been contracted for the second 90-day period, during which Iraq is allowed to sell up to $1 billion worth of crude oil. (DJ)

Mar. 1 Sudan signs contracts with national oil companies from China and Malaysia and a private Canadian company (Arakis) to develop its oil reserves. The contracts also cover construction of a 50,000-barrel-per-day oil refinery in Khartoum and a 900-mile oil pipeline to transport up to 250,000 barrels per day to Port Sudan on the Red Sea. Sudan hopes to increase crude oil output to 150,000 barrels per day by mid-1999 (current production is estimated between 10,000 and 15,000 barrels per day). A civil war that erupted in 1983 hampered previous oil industry development in Sudan, which currently consumes about 50,000 barrels per day of refined products. (DJ)

Mar. 3 In its regular 60-day review, the United Nations Security Council votes to maintain sanctions on Iraq. This is the 36th review since sanctions were first imposed in 1990. (DJ)

Mar. 3 Lyondell Petrochemical and Citgo Petroleum announce the completion of a $1.1 billion upgrade of their joint venture LCR refinery in Houston. The upgrade allows the refinery to process more than 215,000 barrels per day of very heavy crude oil (17 degree API gravity) from Venezuela and to produce higher valued products such as reformulated gasoline and low-sulfur diesel. Affiliates of Venezuela's state oil company (Citgo's parent company) supply up to 230,000 barrels per day of crude oil under a long-term contract and Citgo purchases and markets most of the refined product output. For Venezuela, the joint venture refinery secures guaranteed long-term markets for its heavy crude oil. (DJ)

Mar. 3 A Venezuelan Navy spokesman announces that a major oil spill (25,000-50,000 barrels) off Venezuela's western coast will take at least one month to clean up. The spill occurred when the Greek tanker Nissos Amorgos ran aground February 28 and began leaking its cargo of 476,000 barrels of heavy crude oil. Maraven, a unit of state-owned oil company Petroleos de Venezuela, reports that the tanker was leased by Italy-based oil companies Agip. (DJ)

Mar. 3 Mexico's state oil company Petroleos Mexicanos (Pemex) establishes two new petrochemical subsidiaries covering the Cangrejera and Morelos complexes. Establishment of subsidiaries is the first step in the process of privatizing Mexico's petrochemical industry. To date, Pemex has established subsidiaries for 6 of its 10 petrochemical complexes (subsidiaries for Camargo, Cosoleacaque, Escolin and Tula were announced in late January). Competitive bidding for the sale of 49 percent of each subsidiary is scheduled to begin in the second half of 1997. (DJ)

Mar. 4 Mexico's state oil company Petroleos Mexicanos (Pemex) reports the Campeche Sound (in the Gulf of Mexico) has hydrocarbon potential of 74 billion barrels of crude petroleum equivalent, proven reserves of 17.1 billion barrels, and cumulative production of 11.8 billion barrels. Pemex plans to publish estimates for Mexico's Southern Region in 1998 and its Northern Region in 1999. At the end of 1995, Pemex claimed that proven hydrocarbon reserves (crude oil and natural gas) for all of Mexico stood at 62.06 billion barrels of crude petroleum equivalent. (DJ)

Mar. 5 The United Nations approves the 36th contract for the sale of Iraqi oil and announces that the $1.07 billion limit for the first 90-day period of Iraq's oil-for-food program has been "more or less met." The $1.07 billion includes $70 million in pipeline fees to Turkey. (DJ)

Mar. 6 The North Sea's Captain Field, operated by a unit of Texaco, begins production. Located about 90 miles northeast of Aberdeen, Scotland, the field holds estimated reserves of 350 million barrels of oil and 53 billion cubic feet of natural gas. It is expected to reach peak production of 67,000 barrels per day by mid-1997. (WSJ)

Mar. 6 The Minerals Management Service of the U.S. Department of Interior reports a record-breaking sale of offshore oil and natural gas leases in the Central Gulf of Mexico. The sale attracted more than $824 million in high bids from 81 companies (compared with last year's $520.9 million in high bids from 78 companies). The high bid on each block must be evaluated to ensure fair market value before a lease is awarded; each block is approximately nine square miles. (DJ)

Mar. 7 Indonesia's state-owned oil and gas company Pertamina announces that it has secured a $1.13 billion syndicated loan to finance the development of its eighth liquefied natural gas (LNG) plant, to be located in Bontang, East Kalimantan. The plant, with annual production capacity of 2.95 million tons, is scheduled to begin operating at the end of 1999 and will supply LNG to the Korean Gas Company and the Chinese Petroleum Corporation under a 20-year contract. (DJ)

Mar. 7 Spain's Cabinet of Ministers approves the public offering of the government's final 10 percent stake in Repsol, the country's largest oil and energy group. The sale is expected to begin in April. The government has been reducing its stake in stages since privatization began in 1989. (DJ)

Mar. 8 Qatar's al-Khaleej offshore oilfield begins production at an initial rate of 20,000 barrels per day, which will gradually increase to around 30,000 per day by November 1997. A consortium including France's Elf Aquitaine and Italy's Agip are developing the field under a production-sharing agreement with Qatar General Petroleum Corporation. Qatar plans to increase its oil output to around 700,000 barrels per day by 2000, from 550,000 barrels per day currently. (DJ)

Mar. 10 Exxon announces a 'significant discovery' in the Gulf of Mexico, called Hoover, which may contain developable reserves of more than 100 million barrels of oil equivalent. (DJ)

Mar. 11 Turkey's Minister of Energy Recai Kutan reports that Turkey will go ahead with its plans to import Iranian natural gas, despite objections from the United States. Turkey plans to begin operating gas power plants by 2000, when the country's annual demand for natural gas is projected to exceed 950 billion cubic feet. (DJ)

Mar. 11 Royal Dutch/Shell begins drilling its first appraisal well at Peru's giant Camisea field, now thought to be the largest natural gas field in South America. The field, discovered in 1980, could contain as much as 11 trillion cubic feet of natural gas and 600 million barrels of condensate. (DJ)

Mar. 12 By a vote of 99 to 1, Federico Peña is confirmed by the Senate and later sworn in as the eighth U.S. Secretary of Energy. (DJ)

Mar. 12 Turkey's BOTAS pipeline company reports that it has received 29.1 million barrels of oil from Iraq since December 14, 1996 at its Yumurtalik pumping station on the Iraq-Turkey pipeline. 8.4 million barrels were used for domestic consumption and 20.7 million barrels were shipped out of the country aboard 27 tankers. (DJ)

Mar. 13 In his annual state-of-the-union address to Congress, Venezuelan President Rafael Caldera reiterates his administration's determination not to use oil windfall tax revenue on current spending and notes that his administration has created a special account for these revenues in the Central Bank of Venezuela. Separately, Venezuela's Finance Ministry reports the country produced approximately 3.154 million barrels of oil per day (and exported 2.723 million barrels per day) in 1996 -- well above its current OPEC production quota of 2.359 million barrels per day. The government expects both production and exports to increase in 1997 (to 3.25 million barrels per day and 2.876 million barrels per day, respectively). (DJ)

Mar. 14 Officials at Japan's Ministry of International Trade and Industry predict a slowdown in the country's petroleum product demand growth over the next 5 years, to an average annual rate of less than 1 percent (compared with 2.1 percent annually over the past 5 years). Declines in demand for the electric power sector (as new coal, nuclear, and liquefied natural gas plants come on stream) are expected to partially offset continuing increases in other oil-consuming sectors. (DJ)

Mar. 14 Following the signing of a final agreement on the maritime boundary between Australia and Indonesia, Australia's Resources Minister Warwick Parer announces that his country will move to release exploration blocks for petroleum exploration at the earliest opportunity. He cites recent petroleum discoveries in the Timor Sea, which previously had not been considered for petroleum exploration due to uncertainty over which nation had jurisdiction. (DJ)

Mar. 14 The prime ministers of three former Soviet republics in Central Asia -- Kyrgyzstan, Kazakhstan and Uzbekistan -- sign a series of agreements aimed at forming an economic union. (DJ)

Mar. 15 Vietnam accuses China of violating its waters in the South China Sea and demands the immediate removal of a Chinese exploratory oil rig that allegedly has been operating between the Vietnamese coast and China's Hainan Island since the beginning of Mar. (DJ)

Mar. 15 Saudi Arabian Oil Company (Saudi Aramco) reports that production from the Shaybah oil field will begin in June 1998, earlier than its initial plan that called for production of 500,000 barrels per day by December 1999. The field is estimated to contain 7 billion barrels of premium-grade extra light crude oil with 40-42 degree API gravity. The $2.5 billion development program for Shaybah is the largest undertaking by Aramco in recent years. (DJ)

Mar. 17 Mexico President Ernesto Zedillo formally presents the country's 1997 energy sector program, under which the government will invest 69 billion pesos (about $8.7 billion at current exchange rates). This represents an increase of 41 percent in real terms over the amount invested in 1996 and is the highest level of investment in real terms since 1990. The president also reiterates his support for private sector participation -- but only up to a point. Mexico has invited private companies to participate in the transport and distribution of natural gas, electricity generation, and minority ownership in the petrochemicals industry, but has refused to open up its oil production to private investors. (DJ)

Mar. 17 Ecuador authorizes Arco to extract oil from the Villano field in block 10 of the country's Amazon region. Initial production is expected to be 30,000 barrels per day of oil. Arco also plans to build an 80,000-barrel-per-day pipeline that will connect the field with Ecuador's main cross-country oil pipeline by the second quarter of 1999. (DJ)

Mar. 18 Independent oil experts suggest that Mexico may have overstated the size of its petroleum reserves by as much as 30 percent since the 1970s, and indicate that Mexico's latest reserves estimates are more in line with outside estimates such as the U.S. Central Intelligence Agency's. This is based on an analysis of a statistical report, released earlier this month. In the report, Mexico reduced its estimates of proven reserves in the Bay of Campeche to 15 billion barrels of crude oil and 9.7 billion cubic feet of natural gas (from previous estimates of 23.5 billion barrels of crude oil and 11.6 billion cubic feet of natural gas in 1996). The report was the first report on Mexican reserves to be audited by independent experts. The Bay of Campeche currently accounts for about 80 percent of Mexico's oil and natural gas production. Reserve studies of other major petroleum areas (including the Chincontepec and Tabasco-Chiapas fields) are not expected to be completed until 1999. (NYT)

Mar. 18 Mobil announces the start-up of oil production from the second production facility on the Wandoo field (the Wandoo B platform) on Australia's North-West Shelf, which will boost the field's production to 40,000 barrels per day by May 1997 (current production is 8,000 barrels per day). Australia's Bureau of Agricultural and Resource Economics reports several other projects are expected to approach full production capacity in the next fiscal (July 1997- June 1998), boosting the country's total production by 5.7 percent. New production will be concentrated in the Gippsland Basin offshore southeastern Australia. Other projects expected to come on stream after 1998 include the Elang/Kakatua and the Laminaria/Corallina fields in the Timor Sea, which together could add a further 170,000 barrels per day of production. (DJ)

Mar. 18 Iraq grants Russia most favored nation status to receive Iraqi oil exports in exchange for humanitarian goods. Of the first 37 contracts approved by the United Nations in the oil-for-food sale, 7 went to Russian companies representing almost 20 percent of the volume of oil in the sale. (DJ)

Mar. 18 The United Nations approves the 38th and 39th contracts for the sale of Iraqi oil under Resolution 986, the Iraqi oil-for-food sale. This brings the total dollar value of contracts approved to date to about $1.9 billion of oil (out of a total value of about $2.14 billion allowed over the first 6 months of the oil sale period). According to a Western diplomat, Iraq had shipped 55.9 million barrels of crude oil worth about $1.11 billion under the agreement through Mar. 14, including 4.3 million barrels worth about $77.5 million since the second 90-day period began on Mar. 10. Most of the oil (about 63 percent) has been shipped through the Iraq-Turkey pipeline from Kirkuk to Yumurtalik. (DJ)

Mar. 18 An explosion damages Colombia's Cano Limon-Covenas oil pipeline near the Venezuelan border, the second attack on the country's oil facilities in less than two days. British Petroleum asks Colombian President Ernesto Samper to beef up security near the Cusiana field, the country's largest. Earlier this month, Colombia's state oil company Ecopetrol reported that the Cano Limon-Covenas pipeline was attacked 12 times in January and February, and the Vasconia-Covenas pipeline was attacked once in February. The attackers reportedly are members of the National Liberation Army, a pro-Marxist group that opposes the government's oil policies. (DJ)

Mar. 18 India's oil minister T.R. Baalu announces a new oil policy aimed at increasing investment in the country's oil sector. The new policy allows -- for the first time -- oil exploration ventures that are 100-percent private and foreign-owned. The previous policy required companies to form joint ventures that gave state-run partners up to 40-percent equity when they bid for acreage. (DJ)

Mar. 19 The Czech government announces a 20-year agreement to purchase 1.9 trillion cubic feet of natural gas from a Norwegian consortium of natural gas exporters (Norsk Hydro, Saga Petroleum, and Statoil). Shipments will begin May 1 at the rate of 49 million cubic feet per day, increasing to 290 million cubic feet per day (106 billion cubic feet annually). Currently, Russia's Gazprom is the only supplier of natural gas to the Czech Republic. The contract represents the first time Norwegian natural gas will enter a market in central Europe. The agreement is part of the Czech government's strategy to diversify its imports of natural gas. (DJ)

Mar. 19 Texaco announces that it has received approval from the United Kingdom (U.K.) Department of Trade and Industry to develop the Galley oil and gas field in Block 15/23a of the U.K. North Sea. Initial production will begin in the first quarter of 1998 and reach 43,000 barrels per day of oil equivalent. (DJ)

Mar. 20 China's official news service reports that China hopes to build an annual natural gas production base of about 1.1 trillion cubic feet by 2005 (compared with current production of about 600 billion cubic feet). China also hopes to double its known onshore reserves of natural gas by 2000 (to about 70.6 trillion cubic feet). Exploration and development work will focus on gas-rich regions including: the Shaan-Gan-Ning Basin in central-western China (with proven natural gas reserves currently estimated at about 8.1 trillion cubic feet); the Tarim Basin in the far west (with estimated proven reserves of about 5.6 trillion cubic feet); and Sichuan province in the southwest (with estimated proven reserves of 7.1 trillion cubic feet). In addition, another 1.8 trillion cubic feet of natural gas was recently identified in the eastern part of Qinghai province, just east of Xinjiang. (DJ)

Mar. 20 Yemen's Oil Minister Mohammed Said al-Attar reports that he expects Yemen's 1998 oil output to rise to 420,000 barrels per day from a current average of 360,000 barrels per day. (REUT)

Mar. 20 Colombia's Mines and Energy Minister Rodrigo Villamizar reports that his country's oil output will top 800,000 barrels per day by the end of 1997. (REUT)

Mar. 21 Great Lakes Gas Transmission announces plans to double its capacity to transport Canadian natural gas to pipeline interconnections in the United States no later than the winter of 1999-2000, at a cost of $2.5 billion. The project, which involves about 1,000 miles of pipeline and associated gas compression facilities along the entire length of the company's pipeline system, will allow shipment of an additional 2 billion cubic feet per day of natural gas primarily to markets in the northeastern United States and eastern Canada. (WSJ)

Mar. 22 Iraqi Oil Minister Amir Rashid announces the establishment of a new Iraq/Russian oil company that will work independently of Iraq's national oil company, and reports that other agreements would be signed with France and China. Russia and France were Iraq's main arms suppliers before the Gulf War. (DJ)

Mar. 24 Royal Dutch/Shell reports that local protesters have detained 127 of its staff operating in western Nigeria and taken over six flow stations, disrupting 100,000 barrels per day of crude oil production at six fields. The company plans to maintain oil production at approximately 900,000 barrels per day by increasing production from other fields in the eastern region. (DJ)

Mar. 24 Presidents Heydar Aliyev of Azerbaijan and Leonid Kuchma of Ukraine sign 17 economic, cultural, and military cooperation agreements, including a memorandum on cooperation in the oil and gas industries under which Ukraine will build platforms for a future Caspian Sea drilling project. (DJ)

Mar. 25 The United Arab Emirates appoints Obeid bin Saif al-Nasiri oil minister, replacing Rakadh Bin Salem who had served as acting oil minister since May 1995. (DJ)

Mar. 27 Trinidad and Tobago signs a production sharing agreement with British Gas, Agip, and Deminex for the North Coast Marine Area, a new hydrocarbon province off Trinidad's northern coast. The consortium plans to drill two exploration wells in the next 6 months. The area includes four undeveloped gas fields (Hibiscus, Orchid, Iris and Poinsettia) with potential reserves of more than 3 trillion cubic feet of natural gas. (DJ)

Mar. 27 Shell reports it is losing 210,000 barrels per day of production due to protests at its oil installations in Nigeria (twice as much as originally estimated) but that exports are not being affected because the company has large crude oil stockpiles in the country. (DJ)

Mar. 30 The state-owned Dubai Natural Gas Company opens a new methyl tertiary butyl ether (MTBE) plant with a capacity of 500,000 metric tons a year. The company's chairman, Hussain Alsayegh, reports that most of the output from the $250 million facility will be exported to the United States. (DJ)

Apr. 1 A Shell spokesman confirms the company will declare force majeure at its Nigerian Bonny terminal due to local protests that disrupted 210,000 barrels per day of the company's oil production. Although the protests have ended and production is returning to normal, the backlog is temporarily delaying loadings by 3 days. (DJ)

Apr. 1 Enron begins producing natural gas from the Tapti field offshore India. Production is expected to reach 150 million cubic feet per day by the end of 1997 and continue for 25 years. (DJ)

Apr. 2 The U.S. Department of Energy announces plans to offer two types of interest in the sale of the government portion of the giant Elk Hills oil and gas field near Bakersfield, California: a single "operating working interest" (representing about three quarters of the government's interest) and separate "non-operating working interests" (each representing 2 percent of the government's interests). The sale, scheduled to be completed by February 10, 1998, is one of the largest divestitures of federal property in the nation's history. Current ownership is divided between the U.S. government and Chevron. (DOE)

Apr. 2 The Potential Gas Committee of the American Gas Association estimates that 1996 U.S. natural gas reserves had risen 6 percent from 1994 -- to 1,039 trillion cubic feet (representing about 55 times the current yearly U.S. production levels). The estimate includes: 165.1 trillion cubic feet of proven gas reserves as estimated by the U.S. Department of Energy; 190.9 trillion cubic feet of probable gas reserves from current fields; 240.7 trillion cubic feet of possible gas reserves from new fields; 309.8 trillion cubic feet of speculative gas reserves from frontier fields; 13.4 trillion cubic feet of probable coalbed-methane reserves; 36.3 trillion cubic feet of possible coalbed-methane reserves; and 82.6 trillion cubic feet of speculative coalbed-methane reserves. The committee also presents a higher estimate (1,232 trillion cubic feet) calculated using the statistically aggregated mean values for reserves rather that its traditional methodology. (DJ)

Apr. 2 Esso Production Malaysia announces the start-up of production and sales from the Lawit gas field (150 miles offshore Malaysia), whose production is expected to reach about 450 million cubic feet per day upon completion of development drilling later this year. The company plans to install compression facilities in 1998 to achieve design capacity of 700 million cubic feet a day. (DJ)

Apr. 3 Colombia Gas System announces plans to build a $600 million natural gas pipeline to carry Canadian natural gas to U.S. markets in the northeast. The 380-mile Millennium Pipeline would carry at least 650 million cubic feet per day beginning in early 1999. (NYT)

Apr. 3 TransCanada PipeLines and Northern States Power Co. announce plans to build a $1 billion pipeline to pump natural gas from Alberta, Canada to the U.S. Midwest. The 800-mile Viking Voyageur Gas Transmission project would carry up to 1.2 billion cubic feet per day of natural gas through Minnesota, Wisconsin, and Illinois. (WSJ)

Apr. 7 Express Pipeline begins shipments of Canadian crude oil from Hardisty, Alberta to the Platte PipeLine in Casper, Wyoming. The 785-mile pipeline gives Canadian producers access to U.S. markets in the Rocky Mountain and Midwest regions. Initial design capacity is 172,000 barrels per day. (DJ)

Apr. 8 Nigeria's military government approves the first gasoline imports since September 1996, in response to a 2-week-old fuels shortage. A dusk-to-dawn curfew in response to communal troubles near the country's Warri refinery is impeding fuel deliveries. (WP)

Apr. 8 Turkmenistan President Saparmurat Niyazov names Deputy Prime Minister Batyr Sardjaev as the new oil and gas minister. (REUT)

Apr. 9 Romanian Prime Minister Victor Ciorbea announces plans to close 10 large state companies in the next few weeks, including two oil refineries -- Petromidia Navodari in the Black Sea port of Constanza and the Darmanesti Rafinaria in Bacau. The closures are expected to reduce 1997 refining capacity by about 47 percent, to about 363,000 barrels per day. (DJ)

Apr. 11 China and Vietnam conclude three days of expert-level talks with no resolution over rights to potentially oil-rich waters claimed by both countries in the South China Sea. Earlier in the week, a Chinese oil rig left an offshore area between Vietnam's north coast and China's Hainan Island after completing one month of exploration and drilling. (DJ)

Apr. 14 Australia's minister for resources and energy, Warwick Parer, announces the release of 34 new offshore oil and gas exploration areas -- including 11 areas adjacent to the Zone of Cooperation between Australia and Indonesia in the Timor Sea and 6 areas in the Browse Basin offshore Western Australia. The minister notes that this action "is in keeping with the government's strategy to encourage more intensive exploration in Australia's vast continental shelf." (DJ)

Apr. 14 An Iraqi Oil Ministry official reports that Iraq expects to earn more than $80 billion from its contract with Russia for the development of the West Qurna oil field in southern Iraq. The contract, which was initialed in March and approved by Iraq's National Assembly on April 13, calls for 560 wells which will produce 4.4 billion barrels over 23 years. According to the official, the part of the field being developed with Russia has 11.5 billion barrels in reserves and the entire West Qurna field has reserves of 38 billion barrels. The official states that production will begin "soon" (initially about 250,000 barrels per day, increasing to 600,000 barrels per day). (DJ)

Apr. 17 Royal Dutch/Shell Group estimates Nigeria's proven oil reserves rose to 24 billion barrels at the end of 1996 (8.3 percent higher than the 22 billion barrels estimated in 1995). The Group also reports that Nigerian production could reach 3 million barrels per day by 2002 (and 4 million barrels per day by 2010) with an annual investment of $4-$6 billion (DJ)

Apr. 18 An annual ranking of the world's top oil companies by the Price Waterhouse World Energy Group and Petroleum Intelligence Weekly indicates state-owned oil companies continue to dominate the upstream sector of the world oil industry and are beginning to catch up to the major publicly traded companies in the downstream sector. Based on 1995 data, state-owned companies accounted for 17 of the top 20 companies in terms of oil reserves, 8 of the top 10 companies in terms of oil production, and 4 of the top 10 companies in terms of refining capacity. However, 4 state-owned companies (Petroleos de Venezuela S.A., Saudi Aramco, Indonesia's Pertamina, and Kuwait's KPC) increased their refining capacity by more than 1 million barrels per day in the 1993-1995 period, accounting for about half of the net global increase in refining capacity during that time. (DJ)

Apr. 19 A senior Iranian oil industry official reports that Iran and Russia signed three agreements on cooperation in the oil and gas industries: 1) an agreement whereby Russia's Gazprom would invest directly in joint operations in the development of Iranian gas fields, production capacity, refining, liquidation, and transport of natural gas and associated extraction industries in the Persian Gulf and other areas; 2) an agreement between a newly formed Russian consortium and the National Iranian Oil company (NIOC) for drilling in Iran's continental shelf; and 3) an agreement between NIOC and the oil company of Tatarstan for cooperation in pre-extraction and post-extraction industries. (DJ)

Apr. 21 Occidental Petroleum reports that Colombia's main oil pipeline (Cano Limon-Covenas) was bombed 21 times in the first quarter of 1997 (compared with a total of 45 attacks in all of 1996) and that the leftist National Liberation Army (ELN) is growing increasingly active in the region near its operations. Occidental operates the Cano Limon field in partnership with Ecopetrol (Colombia's national oil company) and Shell. As a result of the repeated attacks, Occidental plans to spend $20 million on security in 1997, including a cooperation contract with the Colombian armed forces. (DJ)

Apr. 22 U.S. Secretary of State Madeline Albright announces sanctions to bar new U.S. investment in Burma (also known as Myanmar) because of the continued oppression of opposition activists by the country's military rulers. About 20 U.S. companies have direct investment or employees in Burma, and the eight largest investors are oil or mining companies: Atlantic Richfield, Baker Hughes, East Asia Gold, Halliburton, McDermott International, Newmont Mining, Texaco, and Unocal. U.S. companies have a total of $240 million in investment in Burma. Unocal, the single largest investor, is a partner in a $1.2 billion joint venture led by Total of France to develop several offshore blocks with significant natural gas reserves. (DJ)

Apr. 23 Pakistan's government approves a privatization plan for 13 state-owned companies (including its electrical and natural gas holdings) over the next 6 months. (DJ)

Apr. 24 Russian President Boris Yeltsin names reformist First Deputy Prime Minister Boris Nemtsov to the additional post of minister of fuel and energy. Nemtsov, who has called for radical liberalization of the energy sector, replaces Pyotr Rodionov, who resigned in March. (DJ)

Apr. 24 Norwegian and British authorities agree on a natural gas treaty covering the Frigg pipeline running from the North Sea to St. Fergus in northern Scotland, reopening the way for exports of Norwegian gas to the United Kingdom and Ireland. Disagreement between the two governments on the use of the pipeline had previously stopped Norway from making new gas sales. The Frigg pipeline currently transports 230 billion cubic feet of gas per year, but capacity can be boosted to 424 billion cubic feet per year. In addition, the two governments reached a framework agreement on the use of connector pipelines to facilitate the use of new oil and gas pipelines which tie installations together on both sides of the British and Norwegian gas sectors. (DJ)

Apr. 25 Shell Nigeria declares force majeure on loadings of Forcados crude oil, effective April 29-May 20, due to the loss of about 90,000 barrels per day from the usual daily production of 450,000-460,000 barrels per day of Forcados crude oil production. The disruption is the result of escalation in fighting between local communities in Nigeria's Warri region. (DJ)

Apr. 25 Russian President Boris Yeltsin signs a decree in support of the Caspian Pipeline Consortium (CPC). The decree gives CPC a 16-year special exemption from rules mandating that it must convert foreign-exchange revenues into rubles as part of a package of support for the venture -- on condition that the company reinvests its revenues in the project. The CPC is a $2 billion joint project of the governments of Russia, Kazakstan, and Oman and a group of private oil companies. It was set up to build a 932-mile pipeline (planned capacity is 1.5 million barrels per day) from Kazakh oilfields on the eastern shore of the Caspian Sea across southern Russia to an export terminal near the Black Sea port of Novorossisk. (DJ)

Apr. 28 The Middle East Economic Survey reports that Iraq's State Oil Marketing Organization (SOMO) is continuing to hold negotiations with international oil companies, despite the fact that the 50 sales contracts approved so far have reached the $2 billion target for the first 180 days under the oil-for-food agreement with the United Nations. According to United Nations statistics, Iraq has sold 121.164 million barrels (averaging 673,000 barrels per day for the 6-month period ending June 7) worth a projected $2.142 billion (including $142 million in pipeline fees for Turkey). (DJ)

Apr. 28 Russian President Boris Yeltsin signs a decree ordering sweeping reforms in the country's natural gas, electric, rail and telecommunications sectors aimed at reducing rates and stimulating investment. At a news conference announcing the decree, First Deputy Prime Minister Boris Nemtsov explains that the state will retain control over these key natural monopolies and will not break up their national supply networks. With respect to natural gas, the government will retain its 40-percent equity stake in the monopoly RAO Gazprom indefinitely and work to strengthen Gazprom's international position and boost its share price. Gazprom will lose its monopoly right to develop new gas deposits (which instead will be allocated at tenders open to competitors), will offer equal access and competitive rates on its national pipeline network to all producers (giving oil and other companies the opportunity to compete in the gas business), and will be required to ensure transparency of its finances with detailed annual financial reports. (DJ)

Apr. 28 Turkey signs a $12 billion agreement to boost its imports of Russian natural gas (from the current level of 212 billion cubic feet) by 18 billion cubic feet in 1997, 71 billion cubic feet in 1998, 106 billion cubic feet in 1999, and 159 billion cubic feet in 2000. By the year 2001, Turkey's total gas purchases from Russia will reach 494 billion cubic feet per year. The gas will be shipped through the existing pipeline, which will be expanded by two new joint ventures which will invest $1.5 billion to add compressor stations and new stretches of pipe to double the capacity. (DJ)

Apr. 29 The U.S. Department of Energy begins soliciting public comment regarding the future of the Strategic Petroleum Reserve (SPR), which will be incorporated into a Statement of Administration Policy on the SPR to be issued in September 1997. (DJ)

Apr. 29 In a report to Congress, the U.S. State Department estimates that the Caspian Sea basin contains proven recoverable oil reserves of 15.6 billion barrels and possible reserves of an additional 163 billion barrels. This contrasts with more generally used estimates of 27.5 billion barrels of proven oil reserves and an additional 40-60 billion barrels of estimated reserves). According to the report, Kazakstan has the largest reserves in the region (10 billion barrels proven, 85 billion barrels possible), followed by Turkmenistan (1.5 billion barrels proven, 32 billion barrels possible), Azerbaijan (3.6 billion barrels proven, 27 billion barrels possible), Iran (no proven reserves, 12 billion barrels possible) and Russia (no proven reserves, 5 billion barrels possible). (WSJ)

Apr. 30 For the fourth year in a row, three Organization of Petroleum Exporting Countries (Iran, Iraq, and Libya) are named on the U.S. State Department's list of the top sponsors of international terrorism (other countries on the list are Cuba, North Korea, Sudan and Syria). Appearance on the list automatically triggers U.S. government sanctions, including: a ban on military sales and aid; controls over export of dual-use items that can be used for either military or civilian purposes; prohibitions on economic aid, and miscellaneous financial and other sanctions. (DJ)

Apr. 30 Shell Nigeria reports that four out of the five flow stations that had shut in 80,000 barrels per day of Forcados crude oil production in the Western Delta area of Nigeria since April 25 have been re-opened. The Warri River flow station is the only one that is still shut in. (DJ)

May 1 In its regular 60-day review, the United Nations Security Council votes to maintain sanctions on Iraq. This is the 37th review since sanctions were first imposed in 1990. This vote, however, does not affect the humanitarian oil sales. (DJ)

May 2 Shell Nigeria announces the release of 15 contractor staff held hostage for 12 days by a local community in Nigeria's Western Delta and the reopening of flow stations that had been disrupted by unrelated civil unrest in the area since April 25. The company expects output of Forcados crude oil, which initially was disrupted by 80,000 barrels per day, to return to normal within a few days. (DJ)

May 2 South Korea Development Corporation buys a 15-percent stake in the North Sea's Captain field from Texaco. The purchase will provide a steady supply of high-sulfur crude oil that will be refined into fuel oil for Korean power generation and will enable the country to develop a strategic fuel reserve. (NYT)

May 2 British Petroleum announces a new oil discovery, the Liberty field, off the north coast of Alaska. Recoverable reserves are estimated at 120 million barrels. (NYT)

May 4 Chinese deputy Vice Premier for trade Li Lanqing and Iranian vice-president Mohammad Hashemi sign a new trade protocol under which exports of Iranian crude oil to China would be increased from the current level of 70,000 barrels per day to 100,000 barrels per day (200,000 barrels per day by 1999). China also accepts an offer from Iran to equip a Chinese oil refinery to handle high-sulfur Iranian crude oil. (DJ)

May 5 The New York Mercantile Exchange (NYMEX) adds Colombia's Cusiana crude oil as a deliverable for its light, sweet crude oil futures contract, effective with the July 1997 contract. (DJ)

May 6 The director of exploration and production for Petrobras, Brazil's state-owned oil company, reports that the company plans to spend $3 billion per year to increase its production to 1.6 million barrels per day by 2001 (from the current level of 900,000 barrels per day and a projected level of 1.2 million barrels per day in 1998). Editor's note: The Energy Information Administration estimates that Brazil produced 840,000 barrels per day of crude oil and 35,000 barrels per day of natural gas plant liquids in March 1997. (DJ)

May 7 Mexico's energy regulatory commission (CRE) awards the concession to distribute natural gas in the northern state of Sonora to a U.S.-Mexico consortium, including U.S. company KN Energy. (DJ)

May 8 Elf Petroleum Nigeria begins construction of its Obite Gas Project, which will supply 253 million cubic feet per day of natural gas to the Nigeria liquefied natural gas plant being constructed at Bonny. The project, which is scheduled for completion in 1999, also involves the construction of an 87-mile pipeline to Bonny and production of about 18,000 barrels per day of condensates. (DJ)

May 9 Colombia's national oil company, Ecopetrol, reports that guerrillas have attacked the country's largest oil pipeline (Cano Limon-Covenas) 24 times so far in 1997, spilling a total of 78,000 barrels of crude oil and reducing production by 500,000 barrels. Colombian armed forces blame the National Liberation Army for 460 separate attacks since the pipeline started operating in 1986. (DJ)

May 10 General Binford Peay, head of the U.S. Central Command, warns that U.S. forces will respond if Iran tries to make good on a threat to close the Persian Gulf's Strait of Hormuz if it felt threatened by the United States. Iran issued the threat earlier in May, following reports that U.S. officials were considering missile strikes against Iran if it was found responsible for a truck bombing that killed 19 American servicemen in Saudi Arabia in 1996. In addition, Iran held military exercises in the Gulf to demonstrate its naval capability. The United States has 18,550 Air Force, Army, Navy, and Marine personnel on 14 ships or at installations in Saudi Arabia, Kuwait, Qatar, and Bahrain. The Strait of Hormuz is the gateway to about one-fifth of the world's oil supply. (DJ)

May 10 Qatar Liquefied Gas Company (Qatargas) signs a contract with Spain's Enagas for the sale of 420,000 tons of liquefied natural gas (LNG) -- 32,300 tons per month for delivery over a 13-month period, beginning September 1997. This will be the company's first LNG sale to the European market. Current capacity is 6 million tons of LNG per year, with most of the output committed to Japan's Chubu Electric Power Company under a 25-year contract. (DJ)

May 10 Turkey and Iraq sign a preliminary agreement to build an 807-mile pipeline to carry Iraqi natural gas to Turkey's Mediterranean port of Ceyhan. The project must secure $2.5 billion in financing prior to implementation. (DJ)

May 10 Libya's oil minister reports that his country has lost about $3 billion in oil revenues since the United Nations imposed sanctions in 1992. The sanctions (which limit diplomatic contacts, ban arms sales, and prohibit air traffic in and out of Libya) are intended to force the surrender of two Libyan suspects wanted in connection with the 1988 bombing of Pan Am Flight 103 over Lockerbie, Scotland, in which 270 people were killed. Editor's note: In November 1993, United Nations sanctions were extended to include a freeze on Libyan funds overseas, a ban on the sale of equipment for oil and gas export terminals and refineries, and tougher restrictions on civil aviation and the supply of arms. (DJ)

May 13 Russian President Boris Yeltsin signs a decree substantially increasing the state's role in managing natural gas giant RAO Gazprom. The order names First Deputy Prime Minister Boris Nemtsov to head a special commission charged with setting government policy at the 40-percent state-owned company (Russia's largest) and calls on the government to draft new regulations on foreign investment in Gazprom shares. (DJ)

May 14 Yemen's oil minister, Mohammed al-Attar, reports that his country's oil production capacity is expected to increase to 500,000-550,000 barrels per day by 2000. Editor's note: The Energy Information Administration estimates that Yemen produced 410,000 barrels per day of crude oil in March 1997. (DJ)

May 14 The leaders of Iran, Turkey, and Turkmenistan sign an agreement under which 1.059 trillion cubic feet per year of Turkmen natural gas would be exported to Turkey, via Iran, for shipment to European markets. (DJ)

May 15 Turkish Energy Minister Recai Kutan reports that Turkey's state pipeline company, Botas, has started construction work for the first phase of a pipeline that will transport Iranian gas into Turkey. He adds that Iran has also begun building its part of the pipeline under the $20 billion, 22-year gas project announced by the two countries in August 1996. (DJ)

May 15 The managing director of Shell Exploration and Production Namibia reports that the company has applied to Namibia's Ministry of Mines and Energy to have the Kudu gas field declared an official petroleum field. This marks the first step in developing the field, located off the country's southern Atlantic coast, which is believed to contain sufficient natural gas to power a planned 750-megawatt power plant in Namibia for at least 20 years. (DJ)

May 15 The Canadian Gas Potential Committee estimates that Canada has 570 trillion cubic feet of discovered and undiscovered natural gas in conventional and unconventional reservoirs (including coalbed methane, tight gas reservoirs, and shale gas). The reserves represent approximately 50 years of supply from conventional sources and another 50 years from unconventional sources. Most of the natural gas is located in the Western Canada Sedimentary Basin. (DJ)

May 15 Tosco Corporation announces the reopening of its Marcus Hook refinery in Trainer, Pennsylvania, after a $100 million refurbishment program. Tosco bought the refinery in 1995 from British Petroleum, and shut it down in January 1996 after failing to reach an agreement with union workers over a new labor contract. In 1996, Tosco said it was cutting the refinery's crude processing capacity to 150,000 barrels per day from the previous level of 190,000 barrels per day. (DJ)

May 16 A final agreement creating the Caspian Pipeline Consortium (CPC) is signed by project participants: Russia (24 percent), Kazakstan (19 percent), Chevron (15 percent), AO Lukoil/Arco (12.5 percent), Mobil (7.5 percent), AO Rosneft/Shell (7.5 percent), Oman (7 percent), Agip SpA (2 percent), British Gas PLC (2 percent), Oryx (1.75 percent), and Kazakstan Pipeline Ventures, a joint venture of Kazakhstan's state oil company and Amoco (1.75 percent). The Russian government plans to transfer its stake to two Russian oil companies, AO Lukoil and AO Rosneft. CPC plans to begin building a 932-mile pipeline to transport crude oil from the Caspian region to Russia's Black Sea coast in 1998 and begin shipping around 558,000 barrels per day of oil in 1999 (planned peak capacity is 1.4 million barrels per day). (DJ)

May 16 USX Corporation and Ashland announce plans to combine most of their downstream oil businesses, creating one of the largest U.S. refiners and continuing an industry trend to consolidate gas station operations. This would be accomplished by a joint venture (for which Ashland Petroleum Co. has signed a letter of intent with Marathon Oil Co., a unit of USX) involving 5,400 gas stations and 6 percent of U.S. refining capacity. (WSJ)

May 20 President Clinton signs an executive order barring new U.S. investment in Burma (also known as Myanmar), effective May 21 and renewable annually. U.S. companies have invested about $250 million in Burma, primarily in the oil and gas sector. The biggest U.S. investor is Unocal, which is building (with France's Total) a $1.2 billion pipeline from Burma's Yadana natural gas field to an electric power plant in Thailand. (DJ)

May 21 The U.S. Department of Energy authorizes its financial advisors to begin contacting prospective bidders for the Elk Hills Naval Petroleum Reserve, one of the largest producing fields in the lower 48 states. Bids must be received by October 1, 1997, and the sale is expected to close by February 10, 1998. (DJ)

May 22 A Mobil Oil executive reports that his company has relocated three rigs outside Nigeria, and may relocate a fourth, because of the Nigerian government's failure to maintain payments for its share of joint venture production costs. Most of Nigeria's oil production (currently 2.2 million barrels per day) comes from joint ventures with international oil groups led by Shell, Mobil, and Chevron. (DJ)

May 23 The International Energy Agency (IEA) issues a communiqué reaffirming that oil security remains a serious concern, particularly given the prospect of increasing import dependence and the increasing concentration of remaining oil reserves in the Middle East. The IEA states that spare crude oil production capacity is now lower than before the 1990 Gulf crisis, and the potential for further fuel switching has diminished. The communiqué was issued following a meeting of the IEA's Board of Governors, at which Hungary was welcomed as the organization's 24th member. (DJ)

May 24 Mohammed Khatami, a moderate cleric, is declared the winner in Iran's presidential election. He will succeed President Hashemi Rafsanjani, who steps down in August after two, four-year terms. (DJ)

May 27 Former Iraqi oil minister Issam Al-Chalabi estimates Iraq needs $5 billion of outside investment and two to three years for its oil industry to restore production to the level prior to the imposition of United Nations sanctions (3.8-4.2 million barrels per day). He also indicates that it would take 5 years and $30-50 billion to achieve production capacity of 5.5 million barrels per day. (DJ)

May 28 The United Kingdom is reported to have added at least 161,000 barrels per day of new offshore oil production in 1997. New oil field start-ups could add up to 190,000 barrels per day more by the end of the third quarter of 1997, and another 84,000 barrels per day at the beginning of the fourth quarter. (DJ)

May 28 West Africa magazine reports that a widespread, complicated series of inter-ethnic claims and conflicts stretching across state and local government boundaries in Nigeria's Niger Delta leaves many onshore and offshore oil and gas projects vulnerable. This area produces about 37 percent of Nigeria's onshore oil production. (DJ)

May 28 Russian President Boris Yeltsin signs a decree designed to limit foreign investment in natural gas giant RAO Gazprom. (DJ)

May 28 Royal Dutch/Shell Group (RD) reports that the Cornea oil structure, located in the Browse Basin offshore northwestern Australia, could contain up to 2.67 billion barrels of oil. (DJ)

May 30 Iraq's Oil Minister, Amer Mohammed Rasheed, reports that the full allotment of $2.14 billion in Iraqi oil (including $140 million for maintaining oil pipelines) has been exported under the United Nations' 6-month oil-for-food program. Oil sales totaled 120 million barrels under 51 contracts with international companies. The United Nations is expected to renew the agreement, which began in December 1996 and expires in early June. (DJ)

June 1 Oman and Iran agree to draw up a joint development plan for the Bukha/Hengam oil field which is jointly owned by the two countries. (DJ)

June 1 Shell Oil Company and Mobil Corporation combine their California exploration and production units into a joint venture company, Aera Energy LLC (58.6 percent Shell, 41.4 percent Mobil). With proven reserves of about 1 billion barrels of oil equivalent and production of about 250,000 barrels per day, the venture is now the largest oil producer in California. (WSJ)

June 2 Amoco Corporation announces plans to sell about 15 percent of its domestic oil and natural gas reserves to allow the company to focus future efforts on six regions. The regions are Trinidad (where it is expanding a liquefied natural gas plant); Venezuela; the Eastern Mediterranean (especially Egypt's Nile Delta); the Caspian Sea; heavy oil projects in Alberta, Canada; and deep-water projects in the Gulf of Mexico. The reserves -- located in Wyoming, Colorado, New Mexico, Oklahoma, and along the coast of the Gulf of Mexico -- total about 450 million barrels of oil equivalent (about two-thirds natural gas) and provide about 10 percent of the company's domestic production. (WSJ)

June 3 Japan's Minister of International Trade and Industry says Japan needs to diversify the sources of its oil supplies further to improve its energy security. (DJ)

June 4 In a unanimous vote, the United Nations Security Council renews for another 180-day period its oil-for-food initiative with Iraq. Under the resolution, Iraq may sell $2 billion worth of oil to buy food, medicine and other necessities to alleviate civilian suffering under the sanctions imposed when it invaded Kuwait in 1990. (WP)

June 4 China signs separate agreements with Kazakstan and Iraq to secure oil supplies into the next century. The agreements cover a $4.3 billion investment in Kazakhstan's Aktyubinsk oil enterprise over the next 20 years, a planned oil pipeline from Kazakstan to China, and the development of the Ahdab oil field in southern Iraq (1 billion barrels at a cost of $1.2 billion). (WP)

June 5 Russia's Deputy Prime Minister Alfred Kokh announces plans to sell an additional 15 percent share of state-owned oil producer AO Lukoil. No details are provided. (WSJ)

June 6 Australian Prime Minister John Howard announces that his country will phase out the use of lead in automobile gasoline by 2010. (DJ)

June 6 Venezuela completes a 5-day auction of 20 marginal oil fields in its third round of sales to foreign investors, earning about $2 billion (twice as much as expected). Successful bidders receive a 20-year production contract with certain minimum investment levels and must pay set royalties and fees for each barrel of oil produced. They include U.S. companies Atlantic Richfield, Chevron, Pennzoil, and Phillips Petroleum; British company Lasmo; and the China National Petroleum Company. (WSJ)

June 10 Chevron Corporation signs a production-sharing agreement to perform seismic tests and drill wells deep beneath China's second largest oil field (Shengli). This is the first onshore exploration pact in China for Chevron, which already has offshore leases in China's Bohai Gulf and the South China Sea. (WSJ)

June 10 The National Iranian Oil Company agrees to spend $250 million to upgrade a large refinery in southern China to increase its capacity for processing Iranian crude oil. (WSJ)

June 10 Kazakstan and Azerbaijan agree to build a 1600-mile pipeline along the floor of the Caspian Sea to ship 315-350 million barrels per year of Kazak oil via Turkmenistan to Baku in Azerbaijan. The pipeline would continue overland across Georgia and Turkey to the Mediterranean Sea. Construction is slated to begin in 2000 and be completed within 3 years. (WP)

June 11 Canadian Prime Minister Jean Chretien names Ralph Goodale the country's new natural resources minister. (DJ)

June 13 Triton Energy reports that it expects combined production from Colombia's Cupiagua and Cusiana fields to reach 500,000 barrels per day in early 1998 (currently 185,000 barrels per day). The company had planned to achieve this goal by the end of 1997, but has recently encountered problems in construction and drilling operations in the Cupiagua field. (WSJ)

June 18 Turkey and Ukraine sign a deal to build a pipeline from Turkey's Mediterranean coast to its Black Sea coast for oil shipments to Ukraine. (DJ)

June 19 The U.S. Supreme Court rules in favor of the Federal Government in an 18-year-old boundary dispute with Alaska over control of offshore areas along the Arctic coast. The decision effectively prevents development of the area's oil and natural gas reserves, as the Federal Government has said it would not permit drilling off the coast of wildlife refuges. (NYT)

June 19 Exxon appeals the $5.3 billion verdict awarded in 1994 to fishermen, native Alaskans, and others harmed by the 1989 Exxon Valdez oil spill. (NYT)

June 20 Talisman Energy receives permission to develop the Ross oil field in the United Kingdom sector of the North Sea. The field, which contains estimated reserves of 60-100 million barrels of oil and 20-30 billion cubic feet of natural gas, is expected to begin producing in September 1998 and reach peak production of 40,000 barrels per day in 1999. (WSJ)

June 20 Russian President Boris Yeltsin orders cuts of up to 40 percent in natural gas prices for businesses that pay their overdue Gazprom bills in cash by the end of the year. High customer debt (estimated at $12.15 billion) makes it difficult for the company to pay its national tax arrears. (WSJ)

June 24 Russia's State Duma (lower house) approves a long-awaited law that would allow production-sharing agreements for development of major natural resource deposits, including five oil fields (Samotlor, Krasnoleninsk, Romashkinskoye, Prirazlomnoye, North Sakhalin), the Kuranakhskoye gold field, and the Yakovlevskoye iron-ore deposit. Investment in these projects is expected to total $16 billion. The legislation now goes to the upper house for consideration, which is expected to consider the measure this fall. (DJ)

June 25 Partners in Australia's Stuart Oil Shale project announce that they have obtained financing to proceed with the first phase of development for what could become the world's first commercial project extracting crude oil from oil shale. If successful, the project would produce 85,000 barrels per day within 10 years. Partners are Canada's Suncor (50 percent) and two Australian companies (Southern Pacific and Central Pacific, 25 percent each). (WSJ)

June 26 The Organization of Petroleum Exporting Countries (OPEC) extends its current output ceiling of 25.033 million barrels per day of crude oil through the end of 1997. The official communiqué indicates quota adherence will be "closely monitored" and announces that the next meeting would take place November 26 in Jakarta, Indonesia. OPEC Secretary General Rilwanu Lukman tells a news conference after the meeting that OPEC's target price remains at $21.00 per barrel. Individual quotas remain as follows (in millions of barrels per day): Saudi Arabia, 8.0; Iran, 3.6; Iraq, 1.2; Venezuela, 2.359; Nigeria, 1.865; Indonesia, 1.33; Kuwait, 2.0; Libya, 1.39; United Arab Emirates, 2.161; Algeria, 0.75; and Qatar, 0.378. (DJ)

June 26 Iranian Oil Minister Gholamreza Aghazadeh reports that U.S. sanctions to deter Iran's ability to attract outside capital "haven't worked at all" because creative financing methods allow foreign companies to avoid punishment under the Iran and Libya Sanctions Act (which was passed in 1996 and applies to investments of $40 million or more). He cites the use of buyback contracts under which companies pay for development rights in oil rather than in dollars, and direct financing by foreign banks (which are not covered by the sanctions law). (DJ)

June 26 The government of Portugal confirms the sale of a 27.5 percent stake in petroleum company Petrogal to Saudi Aramco. Under an agreement scheduled to be finalized by the end of 1997, Saudi Aramco would supply Petrogal's sour crude requirements under a long-term contract. Petrogal operates two refineries (with capacity totaling 300,000 barrels per day) and supplies 50 percent of the country's petroleum products. Portugal's government retains a 45 percent stake (down from 55 percent) and Petrocontrol, a private consortium of shareholders, retains a 27.5 percent stake (down from 45 percent). A leading Portuguese newspaper estimates the reference value of the Saudi share at $1.4-1.5 billion. (DJ)

June 27 International Energy Agency head Robert Priddle says he "regrets" the previous day's action by the U.S. House Appropriations Committee approving a $209 million sale of crude oil from the U.S. Strategic Petroleum Reserve. Priddle notes that U.S. strategic stocks have already dropped from a 90-day supply to less than 70 days currently, following earlier sales of 30 million barrels of crude oil. (DJ)

June 27 China's Premier Li Peng and Russia's Prime Minister Viktor Chernomyrdin sign a series of agreements to boost trade and economic relations between their countries. Included is a planned $4-5 billion project involving the development of Russian natural gas reserves in the Irkutsk region of western Siberia to supply up to 1 trillion cubic feet per year via pipeline to China's coast. (DJ)

June 30 Iran's top military commander says his country does not intend to start a war with the United States, but promises to turn the Persian Gulf into a slaughterhouse if attacked. The pledge follows a series of U.S. warnings about Iran's potential to use missiles to close the Strait of Hormuz to oil tankers and other shipping. (DJ)

June 30 Nigeria's government authorizes the Nigerian National Petroleum Company to swap 100,000 barrels per day of crude oil for petroleum product imports, reversing a year-earlier decision banning the practice due to widespread abuses. The action comes one week after the government authorized importing 33 cargoes of oil products to ease fuel shortages associated with problems at domestic refineries. (DJ)

July 1 The Russian government begins offering many of its remaining oil-industry holdings in a series of auctions and investment tenders expected to raise $780 million by mid-December 1997. The privatizations, which are open to foreign bidders, include Russia's stakes in AO Vostsibneftegaz (38 percent), AO Vostochnaya Neftyanaya (51 percent), AO Sibur (36.28 percent), AO Tyumenskaya Neftyanaya (48.68 percent), AO Komitek (27.1 percent), and AO Norsi-Oil (45.45 percent). (WSJ)

July 1 The British colony of Hong Kong reverts to Chinese rule as a Special Administrative Region. Chinese Prime Minister Li Peng declares Beijing's rule of law will protect foreign interests in post-hand-over Hong Kong. China has promised laissez-faire oversight under the principle of "one country, two systems." (DJ)

July 5 China National Petroleum Corporation (CNPC) reports plans to intensify exploration in eight basins that contain 80 percent of the country's onshore oil and gas reserves while continuing its efforts to secure overseas supplies. According to CNPC, the company has verified 25.6 billion barrels of crude oil reserves and 22.6 trillion cubic feet of natural gas reserves in the past 6 years. (DJ)

July 6 The government of India approves the sale of shares in four state-run companies, including Gas Authority of India Limited and Indian Oil Corporation (DJ)

July 9 Corpoven (a unit of Venezuela's state-owned oil company) signs a formal agreement with three U.S.-based companies (Atlantic Richfield, Phillips Petroleum, and Texaco) that creates a $3.5 billion joint venture. The joint venture will extract and upgrade 197,000 barrels per day of extra-heavy crude oil in the Hamaca Zone of Venezuela's Orinoco Belt. Drilling is expected to start in late 1998, with oil production beginning the following year at an initial rate of 35,000-40,000 barrels per day. The first of two upgrading facilities, designed to produce a grade similar to Alaskan North Slope crude oil, is scheduled to be completed by 2002. (DJ)

July 11 The German cabinet approves a supplementary budget that includes proposals to sell part of the government's strategic oil reserves to meet European Monetary Union criteria for a budget deficit of 3 percent of gross domestic product. Germany plans to sell about $224 million worth of reserves in 1997 (roughly 15 million barrels of oil), and additional volumes in 1998 and 1999. (DJ)

July 11 A tripartite agreement on the transportation of Caspian Sea crude oil via the Baku-Grozny-Novorossiysk pipeline is signed in Baku by Russian Oil and Energy Minister Boris Nemtsov and representatives of Azerbaijan's state oil company and the Chechen oil company. The pipeline, which will pump oil from Azerbaijan across Chechnya to a Russian export terminal in Novorossisk, is expected to be operational within one month. (DJ)

July 15 The president of the Colombian Petroleum Association declares that repeated attacks on Colombia's oil installations have led to a "critical" situation for private oil companies operating in the country. This is in reaction to three attacks in the last 10 days, which forced Ecopetrol, the state-owned oil company, and field operator Occidental Petroleum Corporation to close down production and declare force majeure for all export commitments in the Cano Limon field. The Cano Limon-Covenas pipeline has been attacked 470 times since it began operations in 1986, causing damage in excess of $1.5 billion; however, this is the longest time field operations have been suspended due to the attacks. (DJ)

July 15 Guatemala awards oil exploration contracts in its northern Peten province to four foreign firms (including U.S.-based Oil Technology Service) and one Guatemalan company. Minister of Energy and Mines Leonel Lopez Rodas expects company investments of $128 million in nine potential fields in 1997 and 1998 will make Guatemala self-sufficient in energy supply. Guatemala previously awarded 23 drilling contracts to private firms. (DJ)

July 16 The Brazilian Senate approves the creation of a regulatory body (the National Petroleum Agency) required for implementation of a 1995 constitutional amendment allowing private domestic and foreign enterprises to compete with federally-controlled oil conglomerate Petroleo Brasileiro SA (Petrobras). The legislation also creates a National Energy Policy Council. (DJ)

July 16 Tengizchevroil, operator of Kazakhstan's Tengiz field, awards a $250 million contract for construction of a new oil and gas processing plant that will increase production capacity by 30 percent (from 160,000 barrels per day currently to 240,000 barrels per day by the end of 1999). (DJ)

July 17 Texaco, the government of Saudi Arabia, and the U.S. unit of Royal Dutch/Shell agree to merge their U.S. East Coast and Gulf Coast refining and marketing businesses in a joint venture company pooling four refineries (with total capacity of 823,000 barrels per day) and 14,717 gasoline stations currently owned by Shell and Star Enterprise (a joint venture between Texaco and Saudi Aramco). Under the agreement, Shell would own 35 percent of the new company, and Texaco and Saudi Arabia would hold 32.5 percent each. (WSJ)

July 19 Iran opens an oil jetty for petroleum product exports at Nowshahr port on the Caspian Sea. According to Iran's managing director of Ports and Shipping Organization, the country plans to increase its total port capacity to 4 million barrels per day by the year 2022 (currently 800,000 barrels per day). (DJ)

July 22 The first shipments of oil produced from Kazakhstan's Tengiz field arrive at terminals on the Black Sea in Novorossisk (Russia) and Batumi (Georgia) for subsequent export through the Bosporus Strait. Volumes total between 100,000 and 150,000 barrels per day. (DJ)

July 23 A senior official with Royal Dutch/Shell reports that the company plans to spend at least $10 billion in Latin America by the year 2005, primarily in four countries: Peru, Venezuela, Brazil and Argentina. Major projects include Peru's Camisea fields and the Bolivia-Brazil natural gas pipeline. (DJ)

July 23 The U.S. State Department rules that Turkey's August 1996 agreement to purchase $23 billion worth of natural gas from Iran over a 20-year period does not violate the Iran and Libya Sanctions Act. In a May 1997 memorandum of understanding with Iran and Turkmenistan, Turkey modified the original arrangement so that the natural gas will be purchased from Turkmenistan rather than Iran. (DJ)

July 23 Officials from Turkmenistan, Pakistan, Unocal, and Delta (a Saudi oil company) sign an agreement to build a natural gas pipeline from Turkmenistan across Afghanistan to Pakistan (871 miles). Under the agreement, a consortium will be formed by October 1997, construction will begin by December 1998, and 2001 at an estimated cost of $2.0-2.7 billion will complete the project. The pipeline will carry up to 706 billion cubic feet of natural gas annually from Turkmenistan's largest natural gas fields, at Daulatabad. (DJ)

July 24 The government of Chile approves CMS Energy's $650 million Atacama project, which will transport natural gas via pipeline from northern Argentina across the Andes Mountains to two new natural gas-fired electric generating units at Mejillones in northern Chile. The project is being built in conjunction with Chile's Empresa Nacional de Electricidad SA. Construction of the pipeline will begin in the fourth quarter of 1997 and commercial operations will begin by early 1999. (DJ)

July 25 Presidents Gonzalo Sanchez de Lozada of Bolivia and Fernando Henrique Cardoso of Brazil sign construction contracts for the longest natural gas pipeline in South America -- a 1900-mile pipeline from Rio Grande, Bolivia to three Brazilian cities (Sao Paolo, Curitiba, and Porto Alegre). The 32-inch diameter pipeline, estimated to cost about $2 billion, is scheduled to begin operating in 1999 at an initial rate of 283 million cubic feet per day, increasing to 565 million cubic feet per day after 7 years. Major contractors include Enron, Bechtel and Royal Dutch/Shell. (DJ)

July 26 Iran's President Hashemi Rafsanjani formally inaugurates the 232,000-barrel-per-day Bandar Abbas refinery -- the country's eighth oil refinery. The facility, which will run Iranian Heavy crude oil, has partially started up and is scheduled to be fully operational in March 1998. Iran hopes to become self-sufficient in gasoline, kerosene, jet fuel, and diesel, and begin exporting petroleum products at that time. Domestic petroleum demand averages about 1.1 million barrels per day. The country's refining capacity (excluding Bandar Abbas) totals about 1.2 million barrels per day. (DJ)

July 28 Egypt's Petroleum Minister Hamdi el-Banbi announces that the private sector will be allowed to launch distribution networks for natural gas as part of the government's plan to substitute natural gas for oil. (DJ)

July 28 Azerbaijan's President Heydar Aliyev, on his first visit to the United States, repeats his support for Turkey's port of Ceyhan on the Mediterranean Sea to be the main export route for his country's Caspian Sea crude oil. (DJ)

July 29 State-owned oil company Petroleos de Venezuela (PDVSA) signs agreements turning over operating contracts for 17 marginal crude oil fields to 17 national and international consortiums, the winners in the country's third round of auctions for 20 marginal oil field contracts held in June 1997. The auction raised $2.08 billion. Two fields received no bids and PDVSA later revoked the winning bid on one field (Mata). (DJ)

July 30 The U.S. Federal Energy Regulatory Commission approves several natural gas pipeline projects for delivery of Canadian natural gas to the United States. The projects include: 1) the U.S. portion of Alliance Pipeline Limited's new $3.6 billion pipeline from British Columbia and Alberta to the Midwest (conditional upon Canadian regulatory approval); 2) expansion and extension of Northern Border Pipeline from the Canadian border to the Chicago area; and 3) a portion of the Maritimes & Northeast Pipeline from Sable Island, Nova Scotia, to markets in New England. (DJ)

July 31 Russian state-owned oil company AO Rosneft announces it is pulling out of a $1 billion oil deal (signed July 4) to develop Azerbaijan's Kyapaz field, in the Caspian Sea. Neighboring Turkmenistan, which claims the field as its own (under the name Serdar), has challenged the deal. (DJ)

Aug. 1 Azerbaijan signs production-sharing contracts with Chevron Corporation, Exxon Corporation, Mobil Corporation, and Amoco Corporation. Officials from Azerbaijan value the Caspian Sea projects at more than $10 billion. Mobil will develop the Oguz exploration area, Chevron the Zeynabdin Tagiyev area, Exxon the Nakhchivan area, and Amoco the Inam Prospect. (WSJ)

Aug. 1 United Nations Secretary-General Kofi Annan approves Iraq's request to add the Iraqi-Syrian border as an entry point for food and humanitarian aid under the oil-for-food program. The request provides further evidence of re-established official ties between the two countries. Ties were severed after Syria supported Tehran during the Iran-Iraq War and this new link between Iraq and Syria follows the reopening in mid-June of three border points that were shut in 1980. (DJ)

Aug. 1 Mobil Corporation announces a favorable $78.3 million judgement in litigation with the federal government. The lawsuit involved Mobil's offshore North Carolina federal Outer Continental Shelf oil and gas leases. The company said that the judgement recognizes Mobil's right to terminate five Outer Continental Shelf leases, and recover the purchase price. Mobil sued the federal government in 1992 for the government's failure to allow development of certain oil and gas leases offshore Alaska, Florida, and North Carolina. The Alaska and Florida parts of the litigation were settled in 1995. (DJ)

Aug. 1 Russia annuls a $1 billion oil deal with Azerbaijan in support of Turkmenistan's protest that the deal is illegal. On July 4 Russia's Rosneft and Lukoil signed a deal with Azerbaijan's Socar to develop the Kyapaz field at the edge of Azerbaijan's zone in the Caspian Sea. The Turkmen government protested claiming the field, which Turkmenistan calls Serdar, as its own. (DJ)

Aug. 2 Shell Netherlands BV, a unit of Royal Dutch/Shell Group, unexpectedly shuts down part of Europe's second largest oil refinery. A company spokesperson indicated that the unit at Shell's Pernis refinery near Rotterdam could be closed all month, but did not give a reason for the shutdown. (NYT)

Aug. 4 Mohammed Khatami, a cleric viewed as moderate, is sworn in as Iran's new president. (DJ)

Aug. 4 In Colombia, Occidental Petroleum, a California-based international oil company, and Ecopetrol, Colombia's national oil company, declare force majeure on all oil exports from the Cano Limon field. The declaration comes after a series of attacks dating back to July 30 knocked out a major oil pipeline transporting oil from the field to the Caribbean port of Covenas. The pipeline has been attacked 45 times this year equal to the total number of attacks for 1996. Responsibility for the attacks has not been determined, but leftist guerrillas from the National Liberation Army are usually blamed for such attacks. The force majeure declaration does not apply to the oil contained in the 2-million-barrel storage facility at Covenas. (DJ)

Aug. 4 United Nations (U.N.) Secretary-General Kofi Annan approves a revised Iraqi aid distribution plan under the U.N. oil-for-food program. The oil-for-food program allows Iraq to sell approximately $2 billion of crude oil every six months. Sale periods are divided into two 90-day intervals. The proceeds from the oil sales are paid into a U.N.-run escrow account from which humanitarian supplies are purchased for the Iraqi people. The program went into effect in December 1996 and was renewed for another six months on June 8, 1997. However, since late May 1997, Iraq has refused to sell any oil until the U.N. approved the revised aid distribution plan which is designed to speed up the procedure for approving shipments of humanitarian goods. The next step for Iraq is to gain U.N. approval of an oil pricing formula, and then the U.N. must approve purchase contracts from buyers. Following these two approvals, Iraq can resume its oil exports. Iraq has until September 5, 1997 to sell $1.07 billion of oil under the current 90-day period. (DJ)

Aug. 5 Mobil reveals that production at Nigeria's 100,000 barrel per day Oso condensate field has been completely shut in since the previous week to repair faults in the gas reinjection wells. Bolts securing one offshore injection wellhead sheared, and as a precaution, Mobil decided to replace all the bolts securing offshore injection wellheads. Officials expect delays to Oso condensate loadings, but could not specify how many days' cargoes would be delayed. (DJ)

Aug. 6 Nigeria's government releases $145 million to the state petroleum corporation to begin repair work on its oil refineries. All four of the country's refineries were either closed or had production severely reduced in May due to maintenance problems. These problems have forced Nigeria to import oil to meet domestic needs, despite its position as the world's sixth-largest producer of crude oil. Repairs are expected to begin October 1 and take at least 60 days. (DJ)

Aug. 7 Romanian Prime Minister Victor Ciorbea announces the closure of three of the country's nine oil refineries. Petrotel, Vega, and Darmanesti will close immediately in order to reduce a surplus of oil refining capacity and cut government spending. (DJ)

Aug. 7 Exxon Corporation confirms that it has been chosen as sole foreign partner in a proposed multi-billion-dollar project to expand oil refining and build a major petrochemical plant in Fujian province, China. The joint project, involving Exxon and Fujian Petrochemical, includes increasing oil refining capacity at Xiaocuo from 80,000 barrels per day to 240,000 barrels per day and constructing a 600,000-metric-ton-per-year ethylene plant. In addition, the plant will include a 450,000-ton-per-year polyethylene plant and a 300,000-ton-per-year polypropylene plant. Exxon has a 50 percent share in the joint venture. (DJ)

Aug. 7 Nova Corporation, a Canadian natural gas services and petrochemicals company, officially opens the GasAndes pipeline. The pipeline will initially transport 140 million cubic feet per day of natural gas from Argentina to Chile. The volume will increase to 250 million cubic feet per day by fall 1998. The new pipeline will supply three new gas-fired power plants in Chile that are set to open in October 1997, spring 1998 and fall 1998. The power plants are part of a program to improve the air quality in the Chilean capital, Santiago, by switching from coal-fired to natural gas-fired electrical generation. Nova holds a 56 percent interest in the GasAndes project. (DJ)

Aug. 8 The United Nations approves a sale-price formula for Iraqi crude oil sales under the oil-for-food plan. The approval cleared the way for Iraq to resume limited oil exports immediately through the Turkish port of Ceyhan on the Mediterranean Sea and Iraq's Gulf port of Mina al-Bakr. The United Nations will also begin reviewing contracts for Iraqi crude oil purchases. Iraq has until September 5 to raise the $1.07 billion allowed under the existing 90-day oil-for-food plan window. Iraqi officials state they will boost exports to 2 million barrels per day to meet the sales target. However, industry experts say that Iraq's export capacity is untested beyond 1.4 million barrel per day. (DJ)

Aug. 8 Shell Nigeria announces that it expects to produce 7 percent to 8 percent less oil than had been originally planned for 1997. Officials cite a reduction in hard currency available to its joint venture partners as the reason for the decrease. A cutback in production would reduce output by approximately 70,000 barrels per day to 856,000 barrels per day. (DJ)

Aug. 11 Colombia's national oil company, Ecopetrol, lifts the force majeure declaration on all oil exports from the Cano Limon field. A company spokesman states that crews completed repairs to the Cano Limon-Covenas pipeline on Saturday August 9 and that normal operations have resumed. (DJ)

Aug. 12 A spokesman for Saga Petroleum ASA announces that oil production from the Snorre oil field in the Norwegian sector of the North Sea has been restarted and that it should return to full production within a day. A restart date for the Vigdis field, which was also shut down, has not been set. Production at the two fields was stopped on August 11 following the discovery of a production fault. Snorre produces 200,000 barrels per day while Vigdis has been gradually working towards 40,000 barrels per day following repairs to the gas compressor. (DJ)

Aug. 12 Exxon Corporation shuts down a catalytic cracking unit at its refinery in Baytown, Texas because of an unspecified operating problem. Exxon declined to say when the unit, which produces more than 100,000 barrels per day of gasoline components, is expected to return to service. (NYT)

Aug. 14 Stefan Balabanoff, acting head of economics and finance in the OPEC research division, predicts that OPEC's share of the world oil market will rise from a current level of about 40 percent to 52 percent by 2020. Balabanoff estimates that OPEC's production capacity must rise to 50 million barrels per day to meet the increased demand. From 1995 to 2000 he sees oil demand increasing by an average of 2.1 percent per year and from 2000 to 2010 demand is forecast to rise by 1.4 percent per year. Asian and Pacific countries are predicted to lead the increases in demand. In addition, Balabanoff forecasts growth for non-OPEC supply centered on the North Sea, non-OPEC developing countries, and the Commonwealth of Independent States. (DJ)

Aug. 18 Three international groups confirm that they plan to bid on Petroleos Mexicanos' (Pemex) Cantarell project in the Yucatan peninsula. Pemex, the Mexican state-owned oil monopoly is seeking to boost oil production by injecting nitrogen into the terrain of Campeche State and into the sea floor beneath Campeche Bay in the Gulf of Mexico. Dresser Industries of Dallas will submit a joint bid with U.S. companies Marathon Oil and Praxair, Nova Gas International of Canada, and Bufete Industrial of Mexico. Shell Oil Company entered a joint bid with Enron Corporation and Air Products and Chemicals Incorporated, both from the U.S., and Japan's Mitsui and Company. BOC GROUP PLC of Britain leads the third group. Industry officials estimate the price of the project at $950 million. (WSJ)

Aug. 18 A spokesman for Saga Petroleum ASA reports that production at the Vigdis oil field in the Norwegian section of the North Sea was restarted despite the absence of a replacement gas seal. A temporary measure of transferring gas from the field to the Snorre field for processing enabled the company to restart Vigdis. The replacement seal is in production and scheduled to be completed by August 25. (DJ)

Aug. 20 The Iranian parliament, the Majlis, confirms all 22 of President Mohammed Khatami's nominations for his cabinet. The confirmations are seen as a strengthening of Khatami's mandate to move towards a less strict society and a weakening of the hard-liners' power base in parliament. One of the nominees has advocated direct talks with the United States. Editor's note: The new Iranian Oil Minister is Bijan Namdar Zaganeh. (DJ)

Aug. 20 Mexican President Ernesto Zedillo inaugurates the first U.S.-originated natural gas delivery to the Mexican State of Baja California. The new gas distribution system in Mexicali, the state capital just across the United States border, is the first under the Mexican government's natural gas privatization program. A binational consortium comprised of Enova International, Pacific Enterprises International and Proxima Gas, S.A. de C.V. will distribute the gas for the next 30 years. The deal is valued at $20 million over the first three years for the supply more than 10 billion cubic feet of gas. (DJ)

Aug. 20 The Saudi Arabian Oil Company (Aramco) shut down its 300,000-barrel-per-day oil refinery on the Persian Gulf for maintenance. Aramco expects the shutdown to continue until September 17. Reports suggest that the shutdown will result in the release of extra supplies of Arab Light and Extra Light crude oil for export in August and September. (DJ)

Aug. 20 YPF SA, an Argentine energy company, and Amoco Corporation sign an agreement to operate U.S. natural gas fields with estimated reserves of 989 billion cubic feet of gas. YPF reveals that the joint venture includes 2,000 productive wells in the Texas Panhandle and western Oklahoma, two processing plants with combined daily capacity of 230 million cubic feet of gas, a 932-mile distribution system and 889,560 acres of leased land for exploration. The companies have set up a 50-50 holding company called Crescendo Management LLC to operate the joint venture. (DJ)

Aug. 21 The United Nations approves the pricing formula for September crude oil exports under the United Nations/Iraq oil-for-food sale. Shipments of Iraqi Kirkuk crude oil headed for Europe will increase 20 cents per barrel, and shipments of Basrah Light crude oil to the Far East and United States, as well as Kirkuk crude oil to the Unites States, will increase 10 cents per barrel. (DJ)

Aug. 22 An analyst with Calgary's First Energy Capital Corporation reports that western Canada's natural gas production is declining for the first time in many years and that demand could outstrip supply soon. In addition, the analyst estimates that natural gas reserves in western Canada are declining between 17 percent and 18 percent per year. Ontario Hydro's recent decision to close seven of nineteen nuclear power plants could increase the demand for western Canadian natural gas thereby exacerbating the potential shortage. (WSJ)

Aug. 26 Enterprise Oil announces that for its development plan for the Pierce Field in the central North Sea has received approval from the British government. The company expects the first oil from the field in August 1998 with an initial rate of production of 20,000 barrels per day. Enterprise expects a continuous rate of 45,000 barrels per day shortly thereafter. In addition, Enterprise reveals that it completed a deal with British Petroleum, which increases its stake in the Pierce Field to 75 percent. (DJ)

Aug. 26 China plans to spend $600 million combining onshore and offshore exploration activities at its biggest offshore oil field, Suizhong 36-1 in Bohai Bay. The Bohai Oil Company will build facilities for oil and gas processing, storage, and marketing as well as a new oil berth. Suizhong 36-1 covers 18.5 square miles and has proven oil reserves of 2.1 billion barrels. (DJ)

Aug. 26 The leader of Norway's oil workers union, Terje Nustad, said that the union plans to expand a strike already affecting five oil rigs on the Norwegian continental shelf. The expansion will start after September 10 and will include the West Epsilon rig, the Transocean rig, and the Poly Saga rig. Approximately 340 oil workers went on strike August 24 after rejecting a 7.8 percent raise offered by the Norwegian Shipowners Association. The strike has not slowed daily oil production because the five affected rigs are mainly used for drilling new wells. However, if the strike is expanded, the annual maintenance stoppage at Statfjord B in the North Sea could be extended. Moreover, the restart of Norne field production, scheduled for September, could be delayed. (DJ)

Aug. 27 Consulting firm Arthur Anderson reports that world oil companies increased spending on U.S. exploration and development to $21.6 billion in 1996, an increase of 24 percent over 1995. Major oil companies spent $11.1 billion in the U.S., a 13 percent increase, while independent companies spent $10.5 billion, a 37 percent increase. Royal Dutch/Shell Group, Texaco and Amoco Corporation led the major companies in 1996 U.S. exploration expenditures. Independent spending leaders were Union Pacific Resources Group, Burlington Resources, and Enron Oil & Gas Company. (WSJ)

Aug. 27 The United Nations Security Council announces that it will discuss a possible rollover of Iraqi oil sales from the current 90-day period to the second 90-day period under the renewed oil-for-food program. The existing six-month period of the oil-for-food program began on June 8, 1997, but Iraq stalled on the oil sale until mid-August 1997. The delay makes it impossible for Iraq to sell $1.07 billion of oil during the first 90-day period, which is set to end on September 5, 1997. If the rollover gains approval, it could prevent Iraq from losing an estimated $400 million in sales because of the late start. (DJ)

Aug. 28 Russian officials annul a high-profile deal with Exxon Corporation to develop huge oil deposits in Russia's far north. Late last year Exxon's affiliate, Exxon Arkhangelsk, beat out several international consortia for a 50 percent stake in oil fields in the Timan-Pechora province. Russian officials cite five undisclosed violations committed by Exxon during the tender process as the reason for scrapping the agreement. Some analysts suggest that the cancellation of this $1.5 billion investment project could shake investor confidence in Russia's energy sector and may deter private investment in Russia. (DJ)

Aug. 29 A spokesman for Enterprise Oil confirms that production at Enterprise's North Sea Nelson oil field is to be halted at midnight while an unexploded World War II bomb is removed from close to the Nelson pipeline. The work may take as many as five days to complete; however, Enterprise hopes to restart production on September 1. Normal production from the field is 160,000 barrels per day. (DJ)

Aug. 29 Russia and Turkey sign an agreement to build an underwater pipeline across the Black Sea to transport Russian natural gas to Turkey. The proposed 225-mile pipeline would run from the Russian port city of Tuapse to the Turkish port city of Samsun, and initially carry 280 billion cubic feet of gas. The amount will reportedly double by 2003. Construction of the

pipeline is scheduled to start next year and is expected to be complete by 2000. (DJ)

Sep. 1 South Korea's state-run Daehan Oil Pipeline Corporation (DOPCO) dedicates a 593-mile oil pipeline and a large oil storage terminal in Songnam, 20 miles south of Seoul. DOPCO has invested about $890 million over seven years to complete the two projects. The storage terminal is capable of storing 1.97 million barrels of petroleum products and loading 186,000 barrels of oil per day. The pipeline will transport oil products from five domestic refineries including Yukong and Hyundai Oil Refining Company. (DJ)

Sep. 1 Saga Petroleum, a Norwegian upstream oil company, reveals that production stoppages at the North Sea Vigdis Field, caused by gas compressor problems, have reduced this year's output target from 25 million barrels to 16 million barrels. (DJ)

Sep. 1 Shell Nigeria resumes operations at the Nembe Creek flow stations following repairs of a pipeline leak. Flow stations at Nembe Creek are a part of a major trunk line feeding Nigeria's Bonny Terminal. Shell officials suspect that the line had been sabotaged to force Shell to pay compensation to the local communities for other pipeline leaks. Shell confirms that negotiations are under way with the local communities. (DJ)

Sep. 3 Japanese and Russian governors sign an oil and gas development agreement at a meeting on economic cooperation between three Russian Far East regions and Japan's northernmost prefecture. The agreement targets development of the Sakhalin continental shelf and encourages private companies to participate in offshore oil and gas drilling projects. Commercial production is expected as early as 1999. (DJ)

Sep. 3 After months of negotiations, Chechnya and Russia reach a compromise on transporting Caspian Sea oil across Chechnya. The last issue holding up the agreement was disagreement over tariff rates for the use of the existing Chechen pipeline. (DJ)

Sep. 3 Workers from Colombia's oil, banking, and judicial sectors launch a 24-hour strike to protest government plans to privatize state-held assets. The oil workers are also protesting the detention of 17 oil workers, on charges of bombing Colombia's oil installations and talks between Ecopetrol and British Petroleum to renegotiate a contract to develop the Piedemonte field. (DJ)

Sep. 5 Amoco Corporation announces an agreement to merge its oil and natural gas business in South America's southern region with Bridas Corporation of Argentina. The deal will create what will be Argentina's second-largest oil and natural gas company with more than $3 billion in assets. The new company is currently unnamed with Amoco holding a 60 percent interest and Bridas the remaining 40 percent. The venture will focus on exploration and production in Argentina, Bolivia, Brazil, Paraguay, Chile, Peru, and Uruguay. (WSJ)

Sep. 5 Mobil Oil Canada and Chevron Canada Resources enter a strategic alliance for exploration and development of 29 million acres in the Grand Banks area, offshore Newfoundland. The companies indicate the alliance enables them to move more quickly on proposed exploration and development plans. (DJ)

Sep. 8 YPF SA, Argentina's largest energy company, confirms that its board approved a previously announced agreement with Amoco Corporation to operate U.S. natural gas fields with an estimated 989 billion cubic feet of gas reserves. The venture will be called Crescendo Resources LP, with YPF holding an indirect 64 percent interest and Amoco the remaining 36 percent. (DJ)

Sep. 8 China National Oil Development Corporation, a unit of state-owned China National Petroleum Corporation (CNPC), and Pan-China Resources Limited, a unit of Canada's Ivanhoe Capital Corporation, sign a production-sharing contract to develop oil reserves in China's Hebei province. The two firms will develop the 34.9-square-mile Kongnan block of the Dagang oil field, located 62 miles south of Tianjin. The contract is CNPC's latest effort to stabilize production in China's eastern oil fields. (DJ)

Sep. 10 Norway's state-owned Statoil AS and United Kingdom's (U.K.) Enterprise Oil sign a deal to develop and produce the Pierce oil field located in the U.K. sector of the North Sea. According to Statoil, the deal is worth around $280 million and will last for a minimum of 5 years. The Pierce field has recoverable reserves of 84 million barrels of oil. When it comes on stream in the fall of 1998, it is expected to produce 45,000 barrels per day. (DJ)

Sep. 11 China completes a natural gas pipeline from Shaanxi province to Beijing. The 534-mile pipeline is the county's longest land pipeline. The project cost about $475 million and will supply gas from the Changqing field in northwest China's Ordos Basin. The pipeline is expected to supply Beijing with 10.6 billion cubic feet of gas in 1998 and eventually deliver 212 billion cubic feet of gas annually. (DJ)

Sep. 11 Israel's Prime Minister Benjamin Netanyahu orders a freeze on a major natural gas deal with Russia, which includes the construction of an underwater pipeline to transport the gas from Turkey across the Mediterranean to the Israeli coast. Prime Minister Netanyahu cites suspicions that Russia is helping Iran develop ballistic missiles as the reason for the freeze. (DJ)

Sep. 11 Colombia's President Ernesto Samper inaugurates a natural gas pipeline stretching from the southwestern city of Cali to the city of Mariquita. The 211-mile pipeline cost $312 million and has a maximum capacity of 200 million cubic feet of gas per day. The line will transport gas to 3 million people in about 47 municipalities. (DJ)

Sep. 12 The United Nations Security Council passes a resolution that allows Iraq to reach the $2.14 billion oil sales limit under its oil-for-food program by December 5. The current 6-month oil sales window, running from June 8 to December 5, will be split into a 120-day segment and a 60-day segment instead of two 90-day segments. During each segment Iraq can sell $1.07 billion worth of oil. The resolution should enable Iraq to make up for lost revenues during a delay in the start of oil sales during the first two months of the current six-month sale period. (DJ)

Sep. 15 U.S.-based Bechtel, Peru's Cosapi, and Brazil-based Odebrecht win a $2 billion contract for the design and construction of a natural gas pipeline stretching from Peru's Camisea gas fields to the capital city, Lima. The field is being developed by a joint venture between Royal/Dutch Shell and Mobil Corporation. (DJ)

Sep. 16 Amoco Exploration Company announces a major North Sea drilling program designed to increase reserves and production from its central and northern United Kingdom (U.K.) oil and natural gas fields. The cost of the program is expected to exceed $160 million and extend over a three-to-five year period. The program will initially concentrate on additional development drilling in Amoco's Arbroath field and then continue on to other fields in the central and northern U.K. sector. The program will also utilize new drilling rigs built to operate in harsh conditions. (DJ)

Sep. 17 One day after sending money to Chechnya for repairs to a war-torn pipeline, a Russian commission announces a decision to construct a new pipeline that would bypass Chechnya. The new 176-mile pipeline will run along the Chechen border in the Dagestan republic to the Stavropol region, and then on to Russia's oil terminal at the Black Sea port of Novorossisk. First Deputy Prime Minister Boris Nemtsov estimates the cost of the project at $220 million. (DJ)

Sep. 22 Texaco confirms that is has agreed to sell all of its assets in Burma to the United Kingdom based Premier Oil PLC for $260 million. Texaco holds a 42.9 percent interest in the Yetagun natural gas field and a 50 percent interest in Block M-10, a nearby exploration area. Premier will reportedly sell most of the interests to Petronas, Malaysia's state-owned oil and gas company. (DJ)

Sep. 23 Greenpeace begins legal proceedings against the United Kingdom Department of Trade & Industry in an attempt to block oil and gas exploration west of the Shetland Islands and Scotland in the Atlantic Frontier. Greenpeace is asking for a full judicial review of operating licenses awarded in April's 17th Offshore Licensing Round. The environmental group contends that the European Habitats Directive requires special consideration be given to reef habitats before licenses are granted. If Greenpeace is successful, a full judicial hearing could be held in November. (DJ)

Sep. 24 A four-week-old Norwegian oil strike intensifies as the Norwegian Shipowners' Association threatens to lock out oil workers from 13 floating oil rigs beginning on October 8. The strike began on August 24 and has mainly affected exploration drilling rather production. However, on September 22 the strike forced the closure of the 35,000-barrel-per-day North Sea Yme field. The oil workers union called the strike after rejecting a 7.8 percent pay increase offered by the Shipowners' Association. (DJ)

Sep. 25 Dominique Simondon, chief of conceptional engineering for Elf Aquitaine on the Girassol project, reveals that reserve estimates for Elf's Angolan block 17 oil discoveries have been increased to 3 to 4 billion barrels. Initial reserve estimates of 1 to 3 billion barrels had already made it one of the largest finds offshore West Africa. The Girassol field is due to begin producing oil in the second half of 2000 and is expected to have a production capacity of 200,000 barrels per day. (DJ)

Sep. 25 Russia's State Property Committee approves a privatization plan for AO Rosneft. The approval clears the way for the sale of the Russian government's last major holding in the oil industry. The sale will take place during the fourth quarter of 1997 and the first half of 1998 and will be open to foreign and domestic investors. (DJ)

Sep. 26 Kazakstan and China sign a $4.3 billion deal to explore the Aktyubinsk oil fields in western Kazakstan. The deal comes two days after the China National Petroleum Corporation and the Kazak Ministry of Energy and Natural Resources signed a contract for joint exploration of the Uzen oil field, which includes the construction of a $3.5 billion, 1,863-mile pipeline from western Kazakstan to China. Work on the pipeline is expected to begin in 1998 and be completed by 2005. (DJ)

Sep. 29 France's Total SA confirms that it reached a $2 billion agreement with the National Iranian Oil Company (NIOC) to develop part of the South Pars natural gas field. Other companies that are part of the deal include Russia's Gazprom and Malaysia's Petronas. The South Pars gas field has estimated reserves of 300 trillion cubic feet and is located in the Persian Gulf adjacent to Qatar's North Dome natural gas field. Under the terms of the agreement, Total and its partners will be responsible for the initial development and production of the field until 2002. At the completion of this work, NIOC will take over as production operator. In a related story, the French government warns the United States not to apply the "D'Amato law" to the agreement. The law allows the President of the United States to impose sanctions on foreign companies investing more than $40 million per year in Libya or Iran. (DJ)

Sep. 30 Brazil's Petrobras begins oil production in two major fields in the Campos Basin. The Barracuda and Caratinga fields together contain reserves of one billion barrels of oil equivalent and 530 billion cubic feet of natural gas. The fields are located 50 miles off the coast of Rio de Janeiro. (DJ)

Oct. 1 Russian oil company AO Sidanko's petition to settle a lengthy legal battle with the Russian government and state-owned AO Rosneft for control of the Siberian oil production company AO Purneftegaz is accepted by the Supreme Arbitration Court. The end of the lawsuit clears the final hurdle for the privatization of AO Rosneft. (DJ)

Oct. 1 South Korea's state-owned Korea Petroleum Development Corporation (Pedco) agrees to participate in a consortium to develop Venezuela's Onado oil field. Pedco will hold a 12 percent interest in the development project with the remaining 88 percent split among CGC of Argentina, Carmanah Resources Limited of Canada, and Distral of Venezuela. The Onado field contains 162 million barrels of oil and is expected to produce 52,000 barrels per day beginning in January 1998. (DJ)

Oct. 2 In a joint statement, Norway's Saga Petroleum and state-owned Statoil announce a deal to jointly develop the Haltenbanken South oil and gas area in the Norwegian Sea. The deal combines Haltenbanken's four fields, Kristin, Lavrans, Tyrihans, and Trestakk, into one unit and should speed up the development of the area. Combined reserves are estimated at around 7 trillion cubic feet of natural gas and 630 million barrels of crude oil and condensate. Production is expected to start in 2001. (DJ)

Oct. 2 The Venezuelan Congress approves a proposed $2.5 billion joint venture between Lagoven, a unit of state-owned Petroleos de Venezuela, U.S.-based Mobil, and Germany-based Veba Oel AG to extract and upgrade extra heavy crude oil from the Cerro Negro zone of the Orinoco belt. The project is projected to last 35 years with peak production of 120,000 barrels per day reached by 2001. (DJ)

Oct. 5 Japan Gasoline Corporation (JGC) announces that it has won a contract to design, build, and equip an oil refinery in Pakistan. JGC estimates the total cost of the project to be around $600 million. The refinery will include a crude oil distillation unit and a hydrocracker and will have a processing capacity of 100,000 barrels of crude oil per day, making it Pakistan's largest refinery. It is designed to help meet Pakistan's domestic demand for oil products and is expected to be complete by the end of 2000. (DJ)

Oct. 6 Japan's Itochu Corporation and Japan Gasoline Corporation secure an oil refinery construction contract from the Georgian government. The contract is estimated to be worth between $200 and $300 million, with construction beginning in 1998 and start-up scheduled for 2001. The refinery will be built in Supsa on the Black Sea and will process 60,000 barrels of crude oil per day. It will supply gasoline, gas oil, and heavy fuel oil for domestic consumption in Georgia and export to Ukraine, Turkey, and other neighboring countries. (DJ)

Oct. 6 The Malaysian government confirms that it has approved a proposal submitted by Japan's Chiyoda Corporation to build a 118-mile crude oil pipeline across the Malay Peninsula. The $2 billion pipeline will have the capacity to carry 2 million barrels per day from the Malaysian town of Alor Setar to the Thai port of Sai Buri. Thailand still needs to approve the project before it can go forward, but Chiyoda is expecting that to occur soon. (DJ)

Oct. 6 The U.S. Department of Energy announces that it will sell its 78 percent share of the Elk Hills Naval Petroleum Reserve in California to Occidental Petroleum for $3.6 billion. Currently, Elk Hills produces 60,000 barrels per day of oil, down from a high of 150,000 barrels per day in 1981. The U.S. Congress and the U.S. Department of Justice have 31 days and 60 days, respectively, to review the sale. (DJ)

Oct. 8 The United Nation's Iraq Sanctions Committee votes to provide funds to Turkey to purchase spare parts for the Kirkuk-to-Yumurtalik pipeline that carries Iraqi crude oil to the Turkish port of Ceyhan. The Committee said that the funds are for medium-term maintenance of the pipeline, which is to carry at least half of Iraq's oil exports under the current six-month phase of the oil-for-food program. (DJ)

Oct. 9 Turkey's state-owned oil company, Turkiye Petrolleri AO (TPOA), signs a $750 million deal with Kazakhstan to develop oil reserves in the northwestern Aktyubinsk region near the Caspian Sea. The contract is expected to last at least 29 years, and Kazakhstan could earn $1.8 billion in revenues. TPOA and Amoco will set up a 50-50 joint venture to finance and implement the project. The first four years of the contract are set aside for exploration and the following 25 years for production. Turkish officials estimate that the region contains about 327 million barrels of oil. (WSJ)

Oct. 9 Norway's state-owned oil company, Statoil AS, reports that so far about 60 million barrels of recoverable oil have been found in eight exploration wells drilled this year. In the North Sea, new discoveries were made in the Beta West structure on the Yme field, in the Glitne oil field north of the Sleipner area, and in the Statfjord field. By the end of the year, Statoil will drill four more exploration wells. Its greatest expectations are for the first deep water well on the Vena Dome in the Voering plateau in the Norwegian Sea. (DJ)

Oct. 11 Pilipinas Shell Petroleum Corporation, a unit of Royal Dutch/Shell, and Occidental Philippines Incorporated, a unit of Occidental Petroleum Corporation of the U.S., announce a $5 billion joint venture to distribute natural gas from the Malampaya/Camago natural gas field off the western Philippine island of Pauline. The Philippines has depended heavily on imported coal and oil for its energy needs and has begun to develop its domestic energy resources to reduce this dependence. The Filipino government will retain 60 percent of the revenues generated by the project which should translate into an estimated $8 billion. The remaining 40 percent go to the Shell/Occidental partnership. Shell and Occidental stand to earn $500 million per year in revenues with investments fully recovered in seven to eight years. (DJ)

Oct. 11 Nine days after signing a $2 billion contract with the National Iranian Oil Company, France's Total SA begins Phases Two and Three of the development plan for Iran's South Pars natural gas field. The field contains an estimated 280 trillion cubic feet of natural gas and 7.5 billion barrels of natural gas liquids. Phases Two and Three are designed to produce two billion cubic feet of natural gas per day over 30 years. The deal has the support of the European Union, but has drawn harsh criticism from the Unites States. (DJ)

Oct. 11 Egypt and Libya announce a $1 billion project that includes the construction of a 386-mile oil pipeline between the two countries. The line will transport up to 150,000 barrels of oil per day, carrying Libyan crude oil from the border town of Tobruk to Egyptian refineries. (DJ)

Oct. 13 The Gulf Cooperation Council (GCC), whose membership includes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates, opens a two-day conference with the European Union in Manama, Bahrain, focusing on advanced oil and gas technologies. Fayez al-Sadah, general manager of Bahrain National Oil Company, opened the conference by stating that world crude oil demand is expected to rise from today's level of 72 million barrels per day to 96 million barrels per day by 2010 and that the GCC states are ready to meet any increases in world oil demand. (DJ)

Oct. 14 Shell U.K. Exploration and Production reports that production has started on the Central North Sea Kingfisher condensate field, four weeks ahead of schedule and significantly under budget. The field's reserves are estimated at 56 million barrels of crude oil and condensate and 368 billion cubic feet of gas. Kingfisher is located about 155 miles northeast of Aberdeen. A second production well should be flowing by the end of 1997 and four more wells are expected on line by early 1999. (DJ)

Oct. 14 At a joint news conference, officials from Turkmenistan and Iran announce an agreement to set up a joint consortium to develop offshore oil and gas fields located on their joint border in the Caspian Sea. The two countries also agreed to further efforts toward determining the legal status of the Caspian region in order to provide more guarantees to international companies interested in long-term work in the Caspian. (DJ)

Oct. 20 Two of Mexico's main Gulf Coast crude oil export ports reopen after being closed for five days due to poor weather conditions. The port of Pajaritos usually exports around 400,000 barrels of oil per day and the port of Dos Bocas exports around 300,000 barrels per day. These two ports, along with the port of Cayo Arcos, handle the vast majority of exports from state-owned Petroleos Mexicanos. (DJ)

Oct. 20 The Maritime and Port Authority of Singapore confirms that a 166,500-barrel oil spill from a collision of two oil tankers has been contained in a region southwest of Singapore. On October 15, an empty, very large crude carrier and an oil tanker collided in the Singapore Strait. The oil tanker was carrying about 800,000 barrels of marine fuel oil before the collision. Neither ship was in danger of sinking and clean-up operations began immediately. However, clean-up efforts have been hampered by thick haze from forest fires in nearby Indonesia. The individuals in charge of the two vessels have been charged with reckless navigation. The spill has been described as Singapore's worst. (DJ)

Oct. 21 Thailand's Songkla Petroleum & Chemical Limited signs a $2.2 billion contract with a German joint venture company, Kruppe Uhde GmbH & Thyssen Rheinstahl Technik GmbH, to design and build a crude oil refinery, a petrochemical complex, and a 150-megawatt power plant. The project is part of Thailand's Southern Seaboard Development program and will be constructed in Songkla province in southern Thailand. The oil refinery will have a capacity of at least 125,000 barrels per day. (DJ)

Oct. 21 Qatar General Petroleum Corporation announces that it will move forward with its plans to build a gas pipeline from its North Dome natural gas field to Jebel Ali in the United Arab Emirates. The proposed pipeline will have a capacity of 800 million cubic feet per day and is scheduled to be completed in three years. A five-member consortium led by Atlantic Richfield of the U.S is developing the project. (DJ)

Oct. 22 Kazakhstan's Ambassador to Rome, Olxas Suleimenov, announces that Italy's Ente Nazionale Idrocarburi (ENI), Texaco, BG PLC, and Kazak Gas will invest $9 billion over 40 years to develop Kazakhstan's giant Karachaganak oil and gas field. ENI and BG will each hold a 32 percent stake in the field, Texaco 20 percent and Kazak Gas 16 percent. The Karachaganak field contains reserves of 17.66 trillion cubic feet of gas and 2.2 billion barrels of crude oil and condensates. (DJ)

Oct. 23 Oilwatch Alaska, an oil industry watchdog group, is calling for an antitrust investigation of the companies that control the Trans-Alaska oil pipeline. The group charges that high shipping charges are strangling competition for development of the North Slope oil fields. Oilwatch also accuses the companies of overcharging for oil shipments through the pipeline, which allegedly cuts into profits and costs the state of Alaska billions of dollars in royalties and taxes. The 800-mile pipeline carries 20 percent of US domestic oil production. The companies that control the pipeline include British Petroleum 50 percent, Arco 22 percent, Exxon 20 percent, and Mobil 3.2 percent. Amerada Hess, Philips Petroleum, and Unocal each own less than 2 percent. (DJ)

Oct. 23 The Afghanistan Taliban Islamic movement and Turkmenistan have reached an agreement on setting up a tripartite commission to build a natural gas pipeline from Turkmenistan to Pakistan via Afghanistan. Officials from Turkmenistan and Pakistan signed an agreement in July 1997 to build the pipeline that will carry up to 706 billion cubic feet per year of Turkmen gas. (DJ)

Oct. 23 In response to Iraq's recent refusal to comply with United Nations (U.N.) arms inspections, the U.N. Security Council approves a resolution condemning Iraq's actions. Although the measure does not add new sanctions on Iraq, it expresses the Council's intentions of adopting travel restrictions on Iraqi military and intelligence officials if Iraq continues to inhibit U.N. arms inspections. The resolution passed by a 10-0 vote with five abstentions. (DJ)

Oct. 25 The State Oil Company of Azerbaijan opens an oil pipeline that stretches northwest from Baku on the Caspian Sea, through a 93-mile segment in Chechnya, and on to the Russian port of Novorossisk on the Black Sea. The ceremony marks the first time Azerbaijan has exported its own oil to Western markets in 65 years. (WP)

Oct. 27 Unocal Corporation organizes a multinational consortium to build a natural gas pipeline from Turkmenistan to Pakistan, and possibly India, via Afghanistan. The CentGas pipeline will cost about $2 billion and will transport two billion cubic feet of gas per day 790 miles from the Turkmen border to Multan, Pakistan. The pipeline is expected to take two years to complete. The consortium has also proposed a $600 million, 400-mile extension to New Delhi. Unocal will act as project leader, retaining a 46.5 percent interest in the project. The rest of the consortium consists of Saudi Arabia's Delta Oil (15 percent), the Turkmen government (7 percent), Japan's Itochu Oil Exploration (6.5 percent), Indonesia Petroleum (6.5 percent), Korea's Hyundai Engineering & Construction (5 percent), and Pakistan's Crescent Group (3.5 percent). A 10 percent share has been reserved for Russia's Gazprom, which is expected to sign onto the project soon. (WSJ)

Oct. 27 The Tehran Times newspaper reports that Russia and Iran have signed a memorandum of understanding for Russia to build an oil refinery and a petrochemical complex in the Chahbahar free trade and industrial zone in southeast Iran. (DJ)

Oct. 27 Under pressure from the U.S. Congress, the U.S. Export-Import Bank is expected to suspend $186 million in loan guarantees to 21 oil service companies, that were expecting to sell oil well drilling and measuring equipment to Russia's Gazprom over the next year. The U.S. Congress is calling for the suspension of the loans because of Gazprom's ties to Iran. Gazprom recently signed onto a $2 billion contract to develop Iran's South Pars natural gas field, a deal that may violate the Iran and Libya Sanctions Act. The Export-Import Bank is due to vote on the loan guarantees by the end of 1997. (DJ)

Oct. 28 The U.S. Senate passes the $13.8 billion Interior Appropriates bill that includes a provision directing the Department of Energy to sell $207.5 million of oil from the Strategic Petroleum Reserve. Revenues from the sale will pay for the Reserve's operations over the next year. The bill also extends for another year the current moratorium on offshore oil and gas drilling in parts of the Gulf of Mexico and Alaska. The U.S. House of Representatives has already passed its version of the bill and President Clinton is expected to sign it. (DJ)

Oct. 29 A consortium of South Korean, British, and Italian firms has discovered an oil field in Libya with estimated recoverable reserves of one billion barrels. The field is located 466 miles south of Tripoli on the Murzuk NC-174 block. A contract to explore the field was signed in 1990 by the consortium and Libya's National Oil Company. Under the terms of the agreement, the Libyan company will retain 75 percent of the oil produced and the rest will be equally split among the consortium's members. (DJ)

Oct. 29 Iraq's Revolution Command Council, the country's main decision making body, announces that it will no longer allow U.S. citizens and U.S. aircraft to serve with the United Nations (U.N.) arms inspection teams. The council's statement gives U.S. citizens working with the inspection teams one week to leave Iraq. Iraq has also asked the U.N. to stop flights by American reconnaissance aircraft monitoring its compliance with U.N. resolutions requiring the elimination of weapons of mass destruction. In response to this statement, the U.N. Security Council unanimously approves a statement condemning Iraq's threats to expel the Americans. (DJ)

Oct. 31 Chevron Corporation announces that its Kuito Field (formally known as Block 14) off the coast of Angola, may contain at least one billion barrels of oil. This estimate makes the field one of Chevron's largest finds in several decades. Production is expected to begin by early 1999. Chevron holds a 31 percent interest in the field followed by France's Total, Italy's Agip, and the Angolan government each with 20 percent share, and by Portugal's Petrogal with about a 9 percent share. (WSJ)

Nov. 3 An official from Russian oil drilling company Zarubezhneft denies an Iraqi news report that it will begin developing Iraq's 600,000-barrel-per-day West Qurna oil field. Zarubezhneft is part of a consortium led by Russia's Lukoil that signed a 23-year production sharing agreement with Iraq, valued at $3.8 billion, to develop the field. Zarubezhneft's Deputy General Director Yuri Agababov indicates that there have been negotiations but reiterates that work in Iraq will not start until United Nations sanctions are lifted. (DJ)

Nov. 3 Dutch and Belgian oil worker unions call for a boycott of Nigerian crude oil as part of a campaign to secure the release of jailed Nigerian oil union leaders Milton Dabibi and Frank Korkori. (DJ)

Nov. 4 The U.S. Department of the Interior rejects a petition from environmental groups seeking to halt crude oil and natural gas drilling in the Beaufort Sea off the coast of Alaska's Arctic National Wildlife Refuge. The petition expressed concern for potential damage to the ecosystem of the refuge from pollution and possible oil spills. However, the Interior Department states that Atlantic Richfield Company's plan for exploration in the Beaufort Sea has adequate safeguards to protect the area. (DJ)

Nov. 4 Turkmenistan withdraws three of eleven blocks from the first round of an offshore oil and gas tender opened on September 1, 1997. The three blocks, Lachin, Burgut, and Yelbars, lie on the Turkmen-Iranian Caspian Sea border-zone, calling ownership into question. The three blocks contain estimated reserves of 17.1 trillion cubic feet of natural gas and 5.4 billion barrels of oil. (DJ)

Nov. 5 Texaco North Sea U.K. Limited announces that natural gas and condensate production has begun in its United Kingdom North Sea Erskine field. This follows a November 3, 1997 announcement that first production had been delayed again from the original start-up date of October 14, 1997 due to final testing on a pipeline that will carry gas and condensate to a London platform operated by Amoco Exploration Company. Peak production is expected to reach 120 million cubic feet of gas per day and 29,600 barrels per day of condensate by October 1998. Estimated recoverable reserves total more than 330 billion cubic feet of natural gas and over 75 million barrels of condensate. (DJ)

Nov. 5 Turkmenistan resumes natural gas shipments to Ukraine following the signing of a new agreement on paying for the fuel. Under the agreement, Turkmenistan will supply 99 billion cubic feet of gas through the end of 1997 and 706 billion cubic feet in 1998. Ukraine is required to pay for at least half of the shipments in cash and the remainder through barter and other mechanisms. Turkmenistan cut off gas shipments to Ukraine in April 1997 to force repayment of a $300 million debt from previous gas shipments. (DJ)

Nov. 7 Mexico's state-owned Petroleos Mexicanos announces that it will spend $3.5 billion over the next three years to build coker units at three oil refineries in Salina Cruz, Ciudad Madero, and Minatitlan. The project will begin in 1998 and enable the refineries to produce more high quality products, such as diesel fuel and gasoline, from heavy Mexican crude oil. The upgrade is designed to meet rising domestic demand for oil, but should also permit increased exports. (DJ)

Nov. 8 Azerbaijan's parliament ratifies an exploration agreement signed between Azerbaijan's state oil company and Mobil Corporation on August 1, 1997. The $2 billion deal is for the exploration of the Oguz oil field that is located about 50 miles southeast of the Apsheron Peninsula in the Caspian Sea. Each company holds a 50 percent stake in the project, and reserves are estimated at 733 million barrels of oil. (DJ)

Nov. 11 Russian President Boris Yeltsin and Chinese President Jiang Zemin sign an agreement to build a $12 billion pipeline to carry natural gas from eastern Siberia to China and then on to Japan and South Korea. The pipeline is expected to bring 353 billion cubic feet of gas to China and make available an additional 353 billion cubic feet to Japan and South Korea over a 30-year period. South Korea and Japan have yet to sign off on the deal, but the two countries are expected to provide equipment and financing. (WSJ)

Nov. 11 Russian gas company Gazprom postpones a bond offering to raise up to $3 billion for a natural gas exploration project in Iran. Gazprom cites uncertain market conditions as the reason for the delay. The lead underwriter for Gazprom is Goldman, Sachs, an American investment bank, which may be in violation of the 1996 Iran-Libya Sanctions Act for its role in the bond offering. Gazprom and its partners, France's Total and Malaysian oil company Petronas, signed a $2 billion contract last month with Iran to begin exploration of Iran's South Pars gas field. (NYT)

Nov. 12 BG Exploration and Production and its partners Royal Dutch/Shell Group and Edison International sign a natural gas sales agreement with Egyptian General Petroleum Company to supply gas from the Rosetta Concession, offshore Egypt's Nile Delta. Gas deliveries will begin in January 2000 and reach a maximum of 250 million cubic feet of gas per day. The agreement is scheduled to last for a minimum of 20 years. (DJ)

Nov. 12 The United Nations (U.N.) Security Council unanimously approves a resolution to condemn Iraq for its decision to expel Americans from U.N. weapons inspection teams. The Council's measure imposes a travel ban on Iraqi officials who obstruct the inspection teams and expresses the firm intention to take further unspecified measures if Iraq continues to defy the U.N. (DJ)

Nov. 13 Australian crude oil and natural gas producer, Santos Limited, reports that it has made one of the largest natural gas discoveries in Australia at its Barrolka field in southwest Queensland State. Barrolka's reserves are estimated at 575 billion cubic feet. Santos holds a 58.86 percent interest in the field. (DJ)

Nov. 14 Coastal Corporation signs a memorandum of understanding with Maraven, a unit of Venezuela's state-owned Petroleos de Venezuela, for a 35-year joint venture to produce, refine, and market extra heavy crude oil from the Zuata region of Venezuela's Orinoco Belt. The crude oil will be transported via pipeline to the Jose upgrading complex near Puerto La Cruz and then on to Coastal's 100,000-barrel-per-day refinery in Corpus Christi, Texas. The agreement calls for the joint venture to purchase the Corpus Christi refinery and install a new delayed coking unit and an additional hydrotreatment unit. The deal is still subject to final approval by the Venezuelan Congress and by Coastal's board. (DJ)

Nov. 17 Royal Dutch/Shell announces that it will invest $1 billion in a joint venture with Russia's Gazprom to produce crude oil, natural gas liquids, and natural gas in Russia and elsewhere. Shell and Gazprom will share equal ownership in the partnership. In a separate memorandum of understanding, Shell, Gazprom, and Russian oil company, Lukoil, announce that they will submit a joint bid for a stake in Russian oil company, Rosneft, when it becomes available for privatization in the near future. (NYT)

Nov. 18 Mobil Oil Qatar, a unit of Mobil Corporation, signs a memorandum of understanding with state-owned Qatar General Petroleum Corporation to evaluate development of Qatar's North Field. The giant field contains estimated reserves of more than 380 trillion cubic feet of natural gas and is thought to be the world's largest nonassociated natural gas field. Mobil says the project will eventually deliver one billion cubic feet of natural gas per day, primarily to the Qatari domestic market, more than 30,000 barrels per day of condensate, and more than 15,000 barrels per day of propane and butane. (WSJ)

Nov. 18 Kazakhstan signs an agreement with a consortium that includes US-based Texaco, British Gas, Italy's Agip, and Russia's Lukoil to develop the Karachaganak crude oil and natural gas field in northwestern Kazakhstan. The field's reserves are estimated at more than 2 billion barrels of crude oil and condensate and about 20 trillion cubic feet of natural gas. The consortium will develop the field for the next 40 years, with Agip and British Gas each holding a 32.5 percent interest in the field, Texaco 20 percent and Lukoil 15 percent. (DJ)

Nov. 18 Kazakhstan signs an agreement with a consortium that includes Mobil Corporation, British Petroleum, Royal Dutch/Shell, Norway's Statoil, France's Total, British Gas, and Italy's Agip to explore an offshore area in the North Caspian Sea known as Kazakhstancaspishelf. The agreement allows the consortium to split production from 12 blocks selected by the consortium and also calls for additional seismic data. Drilling is expected to start in 1998. (DJ)

Nov. 18 Nizar Hamdoon, Iraq's United Nations (U.N.) representative, announces that Iraq will not continue the U.N.-sponsored oil-for-food sale unless the U.N. agrees to a specific date for lifting economic sanctions. Hamdoon indicates that Iraq will continue to participate in the current six-month phase of the oil-for-food sale, which runs through December 4, 1997. (DJ)

Nov. 20 Iraq's Revolution Command Council formally endorses an agreement, arranged by Russia, that enables United Nation's (U.N.) weapons inspection teams to resume operations in Iraq. The deal ends a three-week standoff between the U.N. and Iraq that began in late October 1997 after Iraq announced it would no longer allow U.S. citizens to serve on U.N. weapons' inspection teams. (DJ)

Nov. 20 Egypt and Libya sign an agreement to link the two countries' natural gas networks by constructing a pipeline between Tobruk, Libya and Alexandria, Egypt. The two countries also have agreed to form a joint company to manufacture pipelines and integrate their petrochemical industries. (DJ)

Nov. 21 Turkey's state-run petroleum company Turkiye Petrolleri Anonim Ortakligi will team with Amoco Corporation to explore and develop the Alibegamolla oil fields in Kazakhstan. The two companies plan to invest $850 million in the oil fields, located in the Temir region. (DJ)

Nov. 24 Exxon Services Venezuela, a unit of Exxon Corporation, agrees to form a joint venture with Corpoven, a unit of Venezuela's state-owned oil company Petroleos de Venezuela. The joint venture will develop extra heavy crude oil from the Hamaca area of the Orinoco belt. Although the project still requires the approval of Venezuela's Congress, Exxon indicates that its initial investment will be $800 million, and Corpoven foresees the companies investing $4.9 billion over 35 years. Exxon will hold a 70 percent interest in the venture and Corpoven the remaining 30 percent. (WSJ)

Nov. 25 Canada's AEC Pipelines initiates an expansion of its Alberta Oil Sands Pipeline to accommodate extra output from the Syncrude Canada plant. The initial phase of the project involves a 30-inch looping of the existing 22-inch system and will increase pipeline capacity to 300,000 barrels per day. This phase is estimated to cost about $155 million and is expected to be completed as early as 1999. AEC also reports that when the pipeline expansion is fully complete, the system will carry up to 950,000 barrels of crude oil per day from Ft. McMurray to Edmonton. (DJ)

Nov. 25 U.S. oil company Chevron Corporation and representatives from Australia's Aborigines finalize a land access agreement for a proposed $2 billion, 1,553-mile natural gas pipeline between Papua New Guinea and Australia's Queensland state. The agreement is a significant step toward final approval of the project that is scheduled for October 1998. (DJ)

Nov. 26 Mexico's state-owned oil company Petroleos Mexicanos signs a $2.46 billion contract with a consortium consisting of South Korea's Sunkyong Engineering and Construction, Germany's Siemens, and Mexico's Tribasa to expand and modernize an oil refinery in northeastern Mexico. The project involves the construction of nine new units, the expansion and updating of ten existing units, and the construction of 754 miles of oil pipeline. Construction is expected to be complete within three years. (DJ)

Nov. 28 United Nations Secretary-General Kofi Annan decides not to give a recommendation on the amount of oil Iraq can sell in the next six-month phase of the oil-for-food program. The current six-month phase ends December 4, 1997. Annan will suggest improvements to the program, but will not specify a recommended amount of oil that Iraq will be allowed to export. Currently, Iraq is allowed to export $1.07 billion worth of oil every 90 days for two consecutive 90-day periods. (WP)

Nov. 29 For the first time in four years, the Organization of Petroleum Exporting Countries (OPEC) agrees to an increase in its production ceiling. OPEC has raised the ceiling to 27.5 million barrels per day for the first half of 1998, effective January 1, 1998. The new ceiling represents a 10 percent increase over the current ceiling. The new quotas are as follows: Saudi Arabia 8.76 million barrels per day, Iran 3.942 million barrels per day, Iraq 1.314 million barrels per day, Venezuela 2.583 million barrels per day, Nigeria 2.042 million barrels per day, Indonesia 1.456 million barrels per day, Kuwait 2.19 million barrels per day, Libya 1.522 million barrels per day, United Arab Emirates 2.366 million barrels per day, Algeria 0.909 million barrels per day, and Qatar 0.414 million barrels per day. (NYT)

Dec. 2 Royal Dutch/Shell has been offered a lead role in building a natural gas pipeline from Turkmenistan to Turkey, according to Alan Parsley of Shell Exploration & Production. The 1,242-mile pipeline, running from Turkmenistan through Iran and into Turkey and European markets, will be designed to carry between 989 billion cubic feet and 1.06 trillion cubic feet of gas annually. (DJ)

Dec. 4 Canada's National Energy Board approves construction of eastern Canada's first offshore natural gas project and a pipeline to carry the gas to markets in eastern Canada and the U.S. Northeast. The combined cost for the two projects is estimated at $2.1 billion. The Board's approval removes some of the uncertainties surrounding the Sable Offshore Energy Project, which is scheduled to start producing 460 million cubic feet of natural gas per day from offshore Nova Scotia in late 1999. (WSJ)

Dec. 4 Iraq's United Nations (U.N.) Ambassador Nizar Hamdoon warns that Iraq will not allow oil to flow during a third six-month phase of the U.N.'s oil-for-food sale until the U.N. approves an aid distribution plan. Despite the warning, the U.N. Security Council approves a third six-month phase following the end of the second six-month phase. Like the first two phases, the third phase allows Iraq to sell up to $1.07 billion of oil in each of two 90-day periods. However, the Security Council may increase the sales level in January 1998 after U.N. Secretary-General Kofi Annan reports on Iraq's needs. (WP)

Dec. 5 Iraq stops pumping oil into the Iraqi-Turkish pipeline at the end of the second six-month phase of the United Nations (U.N.) oil-for-food program in spite of U.N. approval of a third six-month phase. (NYT) (DJ)

Dec. 7 Japan's Isuzu Motors announces that it will begin producing trucks that run on condensed natural gas in August 1998. Isuzu plans to manufacture gas-powered trucks with a two-ton load capacity. The company expects to produce 150 trucks in the first year of production, and another 300 trucks in the following year. Isuzu also expects demand to increase to more than 500 per year in 2000. (DJ)

Dec. 8 As a result of construction delays, Malaysian Refinery Company (MRC) has delayed the start of operations at its 100,000-barrel-per-day oil refinery in Malacca from January 1998 to late March 1998. MRC is a joint venture between Petronas, Malaysia's state oil company, Conoco of the United States, and Norwegian state oil company Statoil. Petronas holds a 45 percent stake in the refinery, Conoco 40 percent and Statoil 15 percent. (DJ)

Dec. 9 Russian oil company AO Yukos announces that it has acquired a controlling interest in Russia's state owned Eastern Oil Company. Yukos won a 45 percent stake in the Siberian oil producer for $775 million, adding to the 9 percent that Yukos already held. The purchase secures Yukos's position as Russia's second largest oil producer behind AO Lukoil. (WSJ)

Dec. 9 French oil company Elf Aquitaine confirms the discovery of a third oil field in Block 17 in the Gulf of Guinea off Angola. The oil field, named Dalia 2, has estimated reserves of 730 million barrels, which will boost Elf's worldwide reserves by 15 percent. Elf holds a 35 percent stake, Exxon 20 percent, British Petroleum 16.67 percent, Norway's Statoil 13.33 percent, Norsk-Hydro 10 percent, and Belgium's Fina 5 percent. (DJ)

Dec. 10 The Australia Gas Light Company has reached a final agreement with Native Title claimants, opening the way for construction of a $35 million natural gas pipeline in Australia's New South Wales state. The 140-mile pipeline will connect the towns of Dubbo and Marsden. Construction is set to commence in January 1998, with first gas deliveries expected in mid-1998. Under the agreement, the Aborigines win guarantees that selected cultural sites will be protected during construction and promises that they will be offered jobs. (DJ)

Dec. 10 Texaco, Brown & Root, and Syntroleum Corporation announce plans to develop a plant that will convert natural gas to synthetic crude oil. The partners state that it will be capable of turning gas into heavy and light synthetic crude that can then be processed into petroleum products. The proposed plant, the first of its kind, will have a capacity of 2,500 barrels per day and will be located outside the United States at a sight to be announced in early 1998. (NYT)

Dec. 11 Delegates from 150 industrial nations attending a United Nations climate conference in Kyoto, Japan reach an agreement to control heat-trapping greenhouse gasses. The agreement commits nations to roll back emissions from the burning of fossil fuels to pre-1990 levels. Under the agreement, the United States is required to reduce greenhouse gases to 7 percent below 1990 levels while Europe and Japan will make cuts of 8 percent and 9 percent, respectively. Developing countries, such as China, are to be exempt from the emissions ceilings for the time being. (DJ)

Dec. 16 Talal Kanaan, an Iraqi official, states that two new oil fields have been discovered in northern and western Iraq. The field in northern Iraq, called Ismail, is expected to add to Iraq's 112 billion barrels of reserves while the western field, located in the western desert, could open a new area for development. (DJ)

Dec. 17 A consortium led by United Kingdom-based Premier Oil PLC signs a $250 million contract to develop an onshore oil field in Albania. The deal involves the development of the Patos Merinze oil field where production of heavy crude is to be increased from 6,000 barrels per day to between 25,000 and 50,000 barrels per day within four years. The consortium consists of Premier with a 25 percent stake, Germany's Preussag 17.5 percent, International Finance Corporation 15 percent, and Albpetrol, Albania's state owned oil company, 42.5 percent. (DJ)

Dec. 17 Australia's Broken Hill Proprietary (BHP) announces that the Australian government has granted a production license to the company for the development of the deep water Blackback oil field in the Bass Strait. BHP states that it will spend about $71 million on the field, while BHP's 50 percent partner, Esso Australia, claims that total expenditures will exceed $128 million. Production is expected to begin in the first half of 1999, with peak production reaching 18,000 barrels of oil per day in the first year. Esso Australia, a unit of Exxon Corporation, adds that the field will also yield 35.3 million cubic feet of natural gas per day. (DJ)

Dec. 18 Norway's state-owned oil company, Statoil, reports that its Smoerbukk South component of the Aasgard oil field will produce more oil than originally expected. Olav Strandenaes, staff engineer for Aasgard, states that a well at Smoerbukk South produced an oil flow of about 15,700 barrels per day but could produce between 30,000 and 37,000 barrels per day. Peak output from Aasgard is estimated to reach 200,000 barrels per day. (DJ)

Dec. 18 Russia's giant gas company Gazprom cancels a $750 million loan deal with the U.S. Export-Import Bank. The loan, signed in November 1994, guaranteed financing for purchases of equipment and services from American companies. Gazprom reports that it decided to turn down the loan guarantees before they could be withdrawn. The U.S. government has been considering sanctions against Gazprom for its participation in a $2 billion project to develop Iran's South Pars gas field. (DJ)

Dec. 19 In a deal valued at nearly $3.5 billion, KN Energy, a Colorado-based natural gas utility, confirms that it will purchase gas pipeline giant MidCon Corporation from Occidental Petroleum. MidCon, headquartered in Lombard, Illinois, primarily transports natural gas from the Gulf of Mexico to as far north as the Canadian Border. KN Energy's acquisition of MidCon complements its decision in August 1997 to purchase Interenergy Corporation, an energy company that processes and markets natural gas in the Rocky Mountains. (WSJ)

Dec. 23 After changing one word, the United Nations (U.N.) Security Council agrees to a statement criticizing, but not condemning, Iraq for refusing to grant U.N. weapons inspectors full access to suspected weapons sites. Opposition from Russia and other council members prompted the wording change. The statement comes after chief weapons inspector Richard Butler told the Security Council that Iraq would not allow access to all suspected weapons sites, including Iraqi President Saddam Hussein's palaces and homes. (DJ)

Dec. 24 A spokesman for Shell Nigeria confirms that loadings of Nigerian Forcados crude oil cargos are to be delayed by 1-3 days until the end of January 1998. This announcement follows the earlier closures of 20 flow stations. Two stations, Tunu and Opukushi, had been closed since November 25, 1997, after villagers attacked and occupied the facilities. Those closures forced Shell Nigeria, on December 19, 1997, to declare force majeure on crude exports from its Forcados terminal from December 21, 1997 to January 11, 1998. The other 18 flow stations were shut down on December 21, 1997 because of a contractual dispute. All 20 flow stations have now begun to reopen, with output of Forcados crude returning to the normal 450,000-barrel-per-day rate, and Shell Nigeria continuing talks with local communities and its contract workers. (DJ)

Dec. 24 Japan's Arabian Oil Company (AOC) confirms that it will begin a feasibility study in early 1998 for the development of the Dorra gas field in the Neutral Zone, shared equally by Saudi Arabia and Kuwait. The study will last for about six months and, if it shows that the project is economically viable, AOC will begin commercial production of natural gas after 2000. (DJ)

Dec. 29 The Presidents of Iran and Turkmenistan open a 125-mile natural gas pipeline built to transport Turkmen gas to Iranian power plants. The pipeline cost $190 million and has an initial capacity of 4 million cubic feet per day. The line runs between the Korpedzhe field in Turkmenistan and the Iranian border village of Kurtkoy and it is the first pipeline to carry energy southward from Central Asia. (WSJ)