December 2004

The following chronology lists international events that hold significance for world energy markets. Sources include: Bloomberg, Dow Jones (DJ), Los Angeles Times (LAT), The New York Times (NYT), Reuters, USA Today (USA), The Wall Street Journal (WSJ), The Washington Post (WP), and World Markets Research Centre (WMRC).

January 2004 | February 2004 | March 2004 | April 2004
May 2004 | June 2004 | July 2004 | August 2004 | September 2004 | October 2004 | November 2004 | December 2004

January 6 A previously undisclosed ruling by Lt. General Robert Flowers, head of the U.S. Army Corps of Engineers, exonerates Halliburton Company and its subsidiary Kellogg Brown & Root of any wrongdoing in its fuel-delivery arrangements with a Kuwaiti supplier. The decision comes after Pentagon auditors asserted that the company had overcharged the U.S. government. A full audit of the company’s fuel contracts in Iraq is pending. (NYT, WP)

January 6 The United States renews economic sanctions against Libya despite Libya’s announcement last month that it will abandon its weapons of mass destruction programs and comply with the Nuclear Non-Proliferation Treaty. U.S. officials state that sanctions will be maintained until evidence of compliance is seen. (WMRC)

January 7 The government of India approves plans to build a strategic crude oil reserve. The government plans to build a 37.5 million barrel stockpile, roughly equivalent to two weeks of demand. The project would make India one of the few countries in the world to hold such strategic reserves. (FT, Platts)

January 7 The government of Sudan and rebel leaders sign an agreement on sharing revenue from the country’s oil exports. The two sides agree to equally divide net oil export revenue from southern Sudan for the duration of a 6-year “transition period,” which began in July 2002. With the completion of a major oil export pipeline in July 1999, Sudanese crude oil exports have risen rapidly over the past three years, totaling roughly 195,000 bbl/d in 2002. The Sudanese government has been embroiled in conflict with rebel movements for more than 20 years. (AP, FT, NYT)

January 8 PetroChina cancels deliveries of crude oil to Japan. As both sides wrangle over pricing negotiations and China’s domestic supply shortage grows, PetroChina cuts off the flow of Daqing crude oil to Japan, which in previous years had averaged between 60,000 and 100,000 barrels per day. (WSJ, WMRC)

January 12 Mexican state oil company, Pemex, announces that natural gas drilling has begun on the first four blocks awarded under its first round of “multiple service contract” tenders. The company expects the blocks to increase Mexico’s natural gas production by 400 million cubic feet per day. Specially designed “multiple-service contracts” were created to cede more management control to foreign investors, while maintaining deference to Mexico’s Constitution, which requires that Pemex retain exclusive rights to oil and gas exploration in Mexico. (WMRC)

January 12 The first of two new gasoline producing units comes online at Kuwait’s Mina al-Ahmadi refinery. Once completed, the facilities are expected to turn Kuwait into a net gasoline exporter, having been a net importer in the past. The units will replace facilities which were destroyed during an explosion and fire in June 2000. (Reuters)

January 13 The U.S. Court of Appeals for the Second Circuit in New York rules that the U.S. Department of Energy violated federal energy and environmental regulations by amending a rule requiring manufacturers to increase the efficiency of residential air conditioners by 30% by 2006. In April 2001, the Department of Energy altered the rule to require a 20% increase in efficiency by 2006. Plaintiffs in the case--the Natural Resources Defense Council and Attorneys General from ten states--claimed that as originally intended the rule will eventually reduce electricity peak demand by 14,500 megawatts per year. (NYT, WP)

January14 Natural gas production begins at the Bayu Undan field, located in the Timor Sea and held jointly by Australia and East Timor. Development of Bayu Undan marks the first stage of development of the Joint Development Area agreed to between Australia and East Timor under the Timor Gap Agreement of March 2003. East Timor was internationally recognized as an independent state in May 2002 after decades of subjugation and civil strife. (WMRC)

January 15 The government of India repeals caps on foreign investment in private oil exploration and marketing companies, allowing overseas companies to develop wholly owned oil and gas units. Previously, such investments were capped at 51%. (NYT, WSJ)

January 18 Saudi Aramco formally inaugurates its new Haradh oil and natural gas facility. The Haradh plant is expected to boost Saudi natural gas production capacity by roughly 25%, most of which is slated for the domestic market. The Haradh facility also includes a gas-oil separation plant capable of processing 300,000 bbl/d, as well as infrastructure for delivering up to 170,000 bbl/d of condensates to the Kingdom’s Abqaiq processing facility. Developing the country’s relatively untapped natural gas potential could allow more oil to be allocated for export in the future. (Reuters, LAT, Platts)

January 19 A boiler explodes at Algeria’s Skikda liquefied natural gas (LNG) export terminal killing at least 27 people. The explosion causes heavy damage to three of the facility’s six liquefaction trains and shuts down operations at several adjacent facilities, including a refinery and crude oil and petroleum product loading terminals. Algeria is the world’s second-largest LNG exporter, and the Skikda export terminal handles about one-quarter of the country’s total LNG exports. (EIA, WMRC)

January 20 The prompt month crude oil futures price on the New York Mercantile Exchange (NYMEX) settles at $36.20 per barrel, surpassing $36 per barrel for the first time in 10 months. High prices are attributed to cold weather in the Northeast, which has boosted the demand for heating oil, as well as low commercial crude oil inventories. (WSJ)

January 22 U.S. Interior Secretary Gale Norton approves a plan to open parts of Alaska’s North Slope to oil exploration and drilling. Nine million acres of Alaska’s National Petroleum Reserve will be opened to long-term production. The site lies adjacent to the Arctic National Wildlife Refuge, which remains closed to oil and gas drilling. A lease sale is expected in June. (WP)

January 23 The Alberta Energy and Utilities Board (AEUB) in Canada orders 938 natural gas wells in northeastern Alberta to stop production in an effort to protect the subsurface pressures surrounding the province’s sizeable oil sands reserves. The decision is made following a 6-year study by provincial authorities into the effects of natural gas production on oil sands reservoirs. A group of natural gas producers is later granted an appeal. With the inclusion of oil sands, which the AEUB estimates to total 174.4 billion barrels, Canada holds the second largest proven crude oil reserves in the world after Saudi Arabia according to some estimates. (WMRC)

January 26 Shipping of petroleum products resumes from Algeria’s Skikda port, one week after a devastating explosion. Repairs continue at the port’s oil refinery and LNG facilities. (WMRC)

January 27 Russia’s LUKoil announces a new joint venture with Saudi Arabia’s state oil company, Aramco, to explore for natural gas near the Kingdom’s Ghawar field. Later in the week, similar deals are signed with China’s Sinopec, Italy’s Eni and Spain’s Repsol YPF. The LUKoil project marks the first such deal since July 2003, when Royal Dutch/Shell and Total became the first Western companies to gain access to Saudi Arabia’s hydrocarbon reserves since the nationalization of the Kingdom’s petroleum industry in the 1970s. (WSJ)

January 28 A federal judge in Alaska imposes punitive damages of $4.5 billion ($6.75 billion with interest) on Exxon Mobil for the March 1989 oil spill by the supertanker, Exxon Valdez. Payment is to go to fishermen and residents of the Prince William Sound area, where the oil tanker ran aground and spilled an estimated 11 million gallons of oil. The decision marks the third effort to award such punitive damages after the previous two were struck down by a federal appeals court in San Francisco. Exxon Mobil plans to appeal. (NYT, WP)

February 2004

February 2 Front-month crude oil futures on the New York Mercantile Exchange settle at $34.98 per barrel, leaping by $1.93 per barrel in one day. This was the largest one-day jump in crude oil prices since October 12, 2000, when prices reacted to news of an attack on the Navy’s USS Cole with a $2.81 per barrel increase. Traders attribute upward price pressure to low oil inventory levels in the United States. (WSJ)

February 3 Core shareholders for Russian oil majors Yukos and Sibneft sign an initial protocol on reversing their planned $13 billion merger. Combined into one entity, YukosSibneft, the company would have become Russia’s largest oil firm, with an estimated production of roughly 2.4 million barrels per day. The merger was announced publicly by the two firms in April 2003, but in November 2003, Sibneft backed out of the deal following the arrest of Yukos president Mikhail Khodorkovsky. (NYT)

February 4 Andriy Klyuyev, Ukraine’s Deputy Prime Minister, announces that his country will not reverse the Odessa-Brody pipeline, which extends from Ukraine's Black Sea port of Odessa northward to the city of Brody. The pipeline was designed to carry oil from the Caspian Sea region to Europe, but has been mostly dormant since its completion in 2000. Kiev had previously considered a Russian proposal to reverse the pipeline’s flow, which would have provided Russia with a much-needed export outlet. (WMRC)

February 5 The Alberta Energy and Utilities Board grants approval to Shell’s Jackpine oil sands project. The Jackpine project is expected produce 200,000 barrels per day of bitumen, which will in turn be processed into synthetic crude oil and possibly exported to the United States. No timetable has been set yet for the project, but some analysts suggest that production is unlikely to begin before 2011. (WMRC)

February 11 OPEC delegates meeting in Algiers agree to lower the cartel’s output ceiling by 1 million barrels per day, to 23.5 million barrels per day, effective April 1. OPEC members also urged immediate compliance with the existing OPEC ceiling, as overproduction has been estimated at roughly 1.5 million barrels per day. Assuming full quota compliance, the decision could remove a total of 2.5 million barrels per day from the world market in April. (NYT, WSJ)

February 18 The U.S. Department of Transportation announces its decision to extend a rule giving credits to automakers for building vehicles which can run on ethanol. These credits can be used by automakers to meet federally mandated fuel economy targets. The credit, which was originally created under a law passed in 1998, was designed to encourage the use of alternative fuels, but has come under criticism as opponents charge that the duel-use vehicles which earn the credits almost always run exclusively on gasoline. In 2002, the Departments of Transportation and Energy and the U.S. Environmental Protection Agency reported that extending the credit could increase U.S. gasoline consumption by up to 14 billion gallons (total) between 2004 and 2008. (WSJ, NYT)

February 19 The Japanese government signs a deal in Tehran giving a consortium of Japanese companies the right to help develop Iran’s Azadegan field. Tokyo’s negotiations in Iran began in 2000, but heretofore had been slowed due to disagreements over terms with the Iranian side and diplomatic pressure from the United States against the deal. The deal stipulates that production begin in approximately two years and eventually reach a rate of 300,000 barrels per day. (WSJ, WMRC)

February 19 The Royal Dutch/Shell group announces that the Securities and Exchange Commission (SEC) has begun a formal investigation into the company’s restatement of its oil and gas reserves. On January 9, 2004, Royal Dutch/Shell announced that it had overstated its proven oil and gas reserves by 3.9 billion barrels, or 20% due to overly optimistic assumptions about plans for developing its fields around the world. (NYT)

February 23 Algeria’s Ambassador to the United States, Idriss Jazairy, says that preliminary results from an investigation into an explosion at the country’s Skikda liquefied natural gas (LNG) terminal on January 19, 2004, indicate that the incident was caused by a leaking gas pipeline, not a faulty steam boiler as has been previously suspected. There are over 30 pending proposals for new LNG import terminals in the United States, and opponents of LNG have pointed to the Skikda catastrophe as evidence that the facilities are unsafe. A formal report from the Algerian government is pending. (LAT)

February 25 Total (France) and Petronas (Malaysia) sign an estimated $2 billion agreement with the National Iranian Oil Company to build Iran’s first liquefied natural gas (LNG) export facility. The two-train facility will have a capacity of 390 billion cubic feet per year, with natural gas to come from Iran’s South Pars field. Production of LNG is expected to begin in 2009. Iran holds the world’s second largest natural gas reserves—after Russia—and development of LNG facilities would allow the country to export gas around the world. (WMRC)

February 25 Authorities in Kazakhstan announce that construction has begun on phase two of the planned Kazakhstan-China oil pipeline. Phase two entails an 800-mile connection between Atasu in Central Kazakhstan and Alashanku on the Chinese border. Phase one was launched last year, and the entire pipeline is schedule for completion in 2008. China’s oil demand has been growing rapidly in recent years, and this growth is expected to continue. The Kazakhstan-China pipeline will allow oil from Kazakhstan’s prolific Caspian Sea region fields to be piped directly to Chinese refineries. (WMRC)

February 25 An international consortium of oil companies, known as Agip KCO and led by Italy’s ENI, reach an agreement with the government of Kazakhstan on development of Kazakhstan’s Kashagan oil field. Kashagan was discovered in 2000 and is estimated to hold proven oil reserves of 9-13 billion barrels of oil. The consortium members and the government had previously disagreed over the project’s start-date, but today settled on initial production beginning in 2008, three years later than originally planned. According to the agreement, the field is expected to reach peak production of 1.2 million barrels per day by 2016. (NYT, WMRC)

February 26 Veteran energy analyst Matt Simmons outlines the results of his forthcoming analysis of Saudi Arabia’s oil reserves at the Center for Strategic and International Studies in Washington, D.C.. Simmons suggests that Saudi Arabia, which is the world’s largest oil producer and holds most of the world’s spare oil production capacity, could suffer production declines in the next 5-10 years due to rapid depletion of the Kingdom’s recoverable reserves. Representatives from Saudi Aramco refute Mr. Simmons’s assertion, claiming that current production levels—or even higher—are sustainable for decades to come. (NYT, WSJ, WMRC)

February 26 The United States rescinds a ban on travel to Libya and authorizes U.S. oil companies with pre-sanctions holdings in Libya to negotiate on their return to the country if and when the United States lifts economic sanctions. The United States first imposed sanctions on Libya in 1986 following terrorist attacks in Rome and Vienna. Several U.S. oil companies were forced to abandon their assets in Libya when sanctions were imposed in 1986, including the “Oasis Group” (Marathon Oil, ConocoPhillips, Amerada Hess) and Occidental Petroleum. (WSJ)

February 27 U.S. officials in Iraq announce that the Khor al-Amaya oil export terminal on the Persian Gulf has partially reopened, after the successful completion of repairs. Two of the four loading berths are operational, with a total capacity of around 250,000-300,000 barrels per day, reportedly helping to increase country’s export capacity. (Reuters)

March 1 Venezuelan President Hugo Chavez states publicly that if Washington were to impose economic sanctions or invade Venezuela, his country would discontinue oil supplies to the United States. “Mr. Bush must know that if he gets the mad idea of trying to blockade Venezuela, or, even worse, of invading Venezuela—if that happened, the people of the United States should know that not a drop more would reach them from Venezuela,” said President Chavez. Venezuela was the fourth largest foreign supplier of oil to the United States in 2003. (Reuters)

March 1 Iraq’s northern oil export pipeline, Kirkuk-Ceyhan, resumes pumping oil after having been sabotaged several times. Oil flows through the pipeline are only at partial capacity and are being conducted under a “news blackout” to avoid further sabotage efforts. Re-opening of the pipeline, which runs from Iraq, northward to the Turkish port of Ceyhan, gives Iraq another outlet for its lucrative crude oil exports. (WSJ)

March 4 China’s State Council approves a plan to build a national strategic petroleum reserve to be utilized in the event of a global oil supply disruption. The plan will make China one of the few countries in the world to hold strategic reserves. China was the world's third largest consumer of petroleum products in 2002, after the United States and Japan. (DJ)

March 4 Newly appointed Chairman of Royal Dutch/Shell, Jeroen van der Veer, retracts the claims of ousted Chairman Sir Phillip Watts that the company’s January 9, 2004, revision of oil reserves was made “in good faith.” On January 9, 2004, Royal Dutch/Shell announced that it had overstated its proven oil and gas reserves by 3.9 billion barrels, or 20%, claiming overly optimistic assumptions about plans for developing its fields around the world. Later, on February 19, 2004, it was announced that the U.S. Securities and Exchange Commission had launched a formal investigation and on March 3, 2004, Mr. Watts and another official resigned over the controversy. Other investigations have since been launched by the U.S. Department of Justice and European regulators. (NYT, WMRC)

March 5 The supply of liquefied natural gas (LNG) to the United States from Trinidad and Tobago is abruptly halted due to a strike at the country’s Atlantic LNG facility. Striking tugboat workers force the closure of two of the facility’s three LNG trains. The striking workers reportedly return to work on March 10 and deliveries to the U.S. are resumed. Trinidad and Tobago is the largest LNG exporter to the United States and supplies are expected to increase over the next few years as more production trains are added. (Reuters, WMRC)

March 12 A landslide ruptures the SOTE, one of Ecuador’s two crude oil pipelines, halting exports. The roughly 400,000-barrel-per-day pipeline extends about 300 miles from the Lago Agrio area in the Oriente to the Balao terminal near the port city of Esmeraldas. Ecuador’s state oil company is compelled to declare force majeure on petroleum exports. Repairs are completed on March 24, 2004, and in the interim, smaller quantities of crude oil are diverted through Ecuador’s other oil pipeline, Oleoducto de Crudos Pesados (OCP). (Platts, WMRC)

March 13 Iran bars nuclear inspectors from entering the country for an indefinite period of time after the International Atomic Energy Agency (IAEA) passes a resolution rebuking Iran for failure to fully disclose the details of its past nuclear activity. Iran’s top nuclear official, Hassan Rouhani says, “Today, IAEA inspectors were expected to arrive in Iran. We will not allow them to come until Iran sets a new date for their visit. This is a protest by Iran in reaction to the passage of the resolution.” (WP)

March 16 The Energy Information Administration, the independent statistical and analytical agency within the U.S. Department of Energy, releases its report, Analysis of Oil and Gas Production in the Arctic National Wildlife Refuge (ANWR). The 20-page report forecasts the impact that development plans for ANWR could have on domestic oil production, U.S. dependence on foreign oil, and oil prices. (AP)

March 17 The flow of oil through Iraq’s Kirkuk-Ceyhan oil export pipeline is halted after a partial resumption at the beginning of this month. Iraqi authorities reportedly uncover corrosion along the line, forcing them to stop operations until technicians can make repairs. According to press reports, the pipeline remains idle for the rest of March. (DJ)

March 17 Crude oil for April delivery on the New York Mercantile Exchange (NYMEX) settles at $38.18 per barrel, marking a thirteen-year high (in nominal dollars). The day’s settlement price is the highest since October 16, 1990. Recent upward pressure on oil prices is attributed to several factors, including OPEC’s pending output cut scheduled for April 1, relatively low U.S. oil inventories, and growing oil demand worldwide. (LAT, USAT)

March 26 Royal Dutch/Shell signs an agreement with Libya’s state oil company, National Oil Corporation, establishing a landmark partnership to develop Libya’s long-neglected oil and natural gas industries. Since Libya abandoned its weapons of mass destruction program last December, oil and gas companies from around the world have been hoping to sign deals in the country. This includes several American firms which were forced to abandon their assets in Libya when sanctions were imposed in 1986. On February 26, 2004, Washington rescinded a ban on travel to Libya and authorized U.S. oil companies with pre-sanctions holdings in Libya to negotiate on their return to the country if and when the United States lifts economic sanctions. (NYT, WMRC)

March 29 The U.S. average retail price for regular gasoline hits a nominal high point, unadjusted for inflation, of 175.8 cents per gallon, which is 1.1 cents per gallon higher than the previous all-time high set on August 25, 2003. The average price of $1.758 per gallon as of March 29 is still a far cry from the inflation-adjusted March 1981 average price, which would be equivalent to $2.99 per gallon in today’s dollars. (EIA)

March 31 OPEC members unanimously agree to implement the cartel’s oil production cuts effective April 1, as agreed to in February. Relatively high prices for oil and petroleum products had prompted several consuming countries, including the United States, to suggest that OPEC members vote to postpone the cuts and put downward pressure on oil prices. According to the cartel’s official communiqué following the meeting, “Notwithstanding prevailing high prices, the Conference observed that the crude oil market remains more than well supplied as the world moves into the traditionally lower seasonal demand period.” (Reuters)

April 2004

April 1 Argentina begins rationing natural gas exports to Chile in an effort to stave off a domestic energy crisis. With Argentine natural gas demand rapidly outpacing supply, the Argentine government announced in late March its intentions to begin limiting natural gas exports to Chilean utilities, effective April 1, 2004. Despite depending on Argentina for roughly 80% of its natural gas supply in 2002, Chile is not compelled to begin rationing electricity. Andean relations are further complicated later in the month when Bolivia pledges natural gas to Argentina on the condition that none of it is passed on to Chile, its historical rival. (DJ, FT)

April 5 The U.S.-Canada Power System Outage Task Force, led by U.S. Secretary of Energy Spencer Abraham and Canadian Natural Resource Minister Herbert Dhaliwal, releases its Final Report on the August 14th Blackout in the United States and Canada. The report groups the causes of the blackout in to four categories: inadequate system understanding, inadequate situational awareness, inadequate tree trimming and inadequate diagnostic support. The report also includes 46 recommendations for preventing future blackouts. (LAT, DOE)

April 14 The U.S. Securities and Exchange Commission (SEC) announces a change in policy concerning assessments of hydrocarbon reserves in the Gulf of Mexico. The SEC will now accept confirmation of proved reserves in the Gulf of Mexico by several “standard methods,” which include recent technological advancements. Before the announcement, the SEC rules stipulated that only a flow test could confirm proved reserves in the Gulf of Mexico. (WSJ)

April 19 Venezuelan President Hugo Chavez reiterates the threats he made last month to stop selling oil to the United States. President Chavez accuses the United States of “intervening in Venezuela’s domestic affairs,” and suggests that such intervention could, “spark a conflict here, and it would be absurd to continue selling oil to them [the United States].” The United States denies Chavez’s charges. Venezuela was the fourth largest foreign supplier of oil to the United States in 2003. (DJ, WMRC)

April 21 A car bomb explodes outside a police building in Riyadh, Saudi Arabia, marking the first major attack by militants on governmental targets in the Kingdom. Four people are killed and 148 are wounded. The country’s major export facilities are not harmed, but port authorities maintain a “heightened sense of security.” Saudi Arabia is the world’s largest oil producer and America’s second largest foreign supplier of crude oil and petroleum products after Canada. (Reuters, Platts, EIA)

April 21 The United Nations (UN) Security Council unanimously endorses an independent investigation into charges of corruption in the UN-administered “oil-for-food” program in Iraq. The "oil-for-food" program was established by the United Nations in 1995, and used proceeds from the sale of Iraqi oil to buy food and medicine for Iraqis as well as to finance infrastructure and humanitarian projects. The program was officially handed over to the U.S.-led administration in Baghdad in November, 2003. Recently, allegations have arisen in the Iraqi press that foreign administrators of the “oil-for-food” program were receiving inappropriate proceeds from oil sales before the war. (LAT, NYT)

April 23 The United States eases economic sanctions maintained against Libya since 1986. A written statement from the White House Press Secretary states, “ U.S. companies will be able to buy or invest in Libyan oil and products. U.S. commercial banks and other financial service providers will be able to participate in and support these transactions.” (WP)

April 23 Libya’s state-owned National Oil Corporation (NOC) announces its first shipment of oil to the United States in over 20 years. The spokesman did not name the company with whom NOC has contracted to sell the oil, but states that the cargo will be loaded in May and should reach the United States by late May or early June. The United States first imposed sanctions on Libya in 1986 following terrorist attacks in Rome and Vienna. (Reuters)

April 24 Suicide bombers attack Iraq’s Basra maritime oil terminal, killing three U.S. Navy sailors and damaging one tanker berth. Roughly 90% of Iraq’s crude oil exports are currently loaded on to tankers at the Basra terminal, and the incident marks the first known attack on these maritime facilities since the onset of war in March 2003. Previously, efforts by Iraqi insurgents to dismantle the country’s oil industry had focused on facilities on the ground, including pipelines and pumping stations. Iraqi Oil Minister Mohammad Bahr al-Uloum announces the next day (4/25) that “damage was limited and exports are flowing back at the same rates.” (AP, Reuters)

April 24 Five people are killed in Nigeria’s Delta region, including two Americans and three Nigerians, when gunmen attack a boat carrying oil workers. The five oil workers were reportedly investigating ChevronTexaco facilities which had been abandoned in March 2003 but had since been considered for re-opening. Following the attack ChevronTexaco withdraws all personnel from the Western Delta region and suspends activities in the area pending an assessment of the security situation. (WP, WMRC)

April 27 U.S. Secretary of Energy Spencer Abraham awards $350 million to researchers investigating hydrogen fuel technology. This represents the first tranche of the $1.2 billion in funding for the development of hydrogen powered vehicles promised during President Bush’s January 2003 State of the Union address. The money will be divided amongst more than 130 research institutions and auto manufacturers and will address several issues, including the storage, cost and distribution of hydrogen fuel. The funding is intended to help industry meet the Bush Administration’s goal of having hydrogen-powered vehicles on the road by 2015. (AP, USAT)

May 2004

May 1 Militants in Saudi Arabia attack an office of foreign petroleum industry contractors in the oil port city of Yanbu, killing five foreigners and two police officers, as well as injuring other foreigners and police and damaging facilities frequented by foreign workers. The initial attack occurs just outside a petrochemical plant. (DJ)

May 4 The Director of Planning for the National Oil Company of Libya announces that Libya will hold an auction by the middle of 2004 for eight new prospective oil and natural gas projects. This will be the first opportunity for U.S. energy companies to do new business in Libya since the end of U.S. sanctions in April 2004. (NYT)

May 4 Pioneer Natural Resources agrees to purchase Evergreen Resources for $1.94 billion in cash and stock. This gives Pioneer access to Evergreen’s large natural gas production base and reserves in the Rocky Mountain region of North America, one of few regions in North America where natural gas production is increasing. (WSJ)

May 4 The Electricity Generating Authority of Thailand approves a power development plan involving an investment of 520 billion baht ($13 billion) for the construction of 21 new power plants. (WSJ)

May 8 A southern oil pipeline to Iraqi export facilities at the Basra and Khor al-Amaya terminals is attacked by saboteurs. Exact damage assessments are unclear, but according to the U.S. Army Corps of Engineers, pumping to the offshore export terminals has stopped. Iraqi Oil Ministry officials announce that repairs are completed on May 18. (Reuters)

May 9 Saudi Aramco and Sumitomo Chemical Company of Japan agree to create one of the largest petrochemical complexes in the world. The facility will be built at Rabigh, on the Red Sea coast of Saudi Arabia, near Yanbu. Total investment could be as high as $4.3 billion, with the plant expected to have a capacity of 2.2 million metric tons per day of olefins. (Reuters)

May 11 Argentinean President Nestor Kirchner announces the formation of a new state energy company, Energia Argentina. The new company will work to expand Argentina’s natural gas transport capacity in order to avoid gas and electricity shortages during the coming winter. Also, the company will undertake joint investments in oil and gas exploration. The federal government will own 53% of the company; the provinces 12%; and private investors 35%. (WSJ)

May 11 A Union Bank of Switzerland report shows that U.S. refining margins have reached an all-time nominal high for the week ending May 8, at $12.61 per barrel of crude oil refined. (Reuters)

May 17 The governments of China and Kazakhstan reach an agreement for the construction of a 770-mile, multi-billion-dollar oil pipeline between the two countries. This will allow Kazakhstan to increase its oil exports to China in the future. The pipeline is to have an initial capacity of 10 million metric tons (about 73 million barrels) per year. (Reuters)

May 20 BP announces that it will invest $2.5 billion for natural gas exploration in Trinidad and Tobago over the next five years. BP intends to increase its natural gas production there from 400,000 barrels per day of oil equivalent to 550,000 barrels per day of oil equivalent by 2008. (Reuters)

May 21 The NuCoastal group of investors agrees to purchase bankrupt energy company Enron’s North American natural gas pipelines for $2.2 billion. The NuCoastal group, which includes Citigroup, ArcLight Capital Partners, Kelso & Company, and Oscar S. Wyatt, would gain control of Enron operation CrossCountry Energy, with 9,900 miles of pipelines and a capacity to carry 8.5 billion cubic feet per day of natural gas. (NYT, WSJ)

May 22 OPEC oil ministers meet in Amsterdam at a forum of energy producing and consuming nations to discuss a response to high oil prices (near-month West Texas Intermediate was above $40 per barrel the previous week). Saudi Arabia calls on OPEC to raise production quotas by as much as 11%, but the ministers do not come to an agreement other than to meet again in Beirut on June 3. Saudi Arabia decides to unilaterally increase its crude oil production beyond its quota to 9.1 million barrels per day in June. (Reuters)

May 24 Near-month crude oil futures on the NYMEX reach a record nominal settlement high of $41.72 per barrel, as the promise of increased output by Saudi Arabia at the Amsterdam conference appears not to assuage traders’ concerns that demand is outpacing supply. (Reuters)

May 25 Mexican Energy Minister Felipe Calderon announces that Mexican state oil company Pemex will attempt to increase crude oil exports from the current 1.88 million barrels per day to 1.95 million barrels per day in the second half of 2004. (Reuters)

May 26 U.S. Secretary of Energy Spencer Abraham announces a $450 million initiative to retrieve and secure tons of highly enriched uranium dispersed among reactors and repositories throughout the world. Highly enriched uranium is fissile and can be used in atomic weapons. (WP)

May 30 Saudi militants attack a complex in Khobar, Saudi Arabia, housing foreign workers. After killing various Saudis and foreigners upon entering the compound on May 29, the militants take hostages, and later kill nine of them. Three of the militants are able to escape despite the efforts of the Saudi security forces. This attack, as well as earlier ones in the kingdom, has foreigners and foreign firms reconsidering their presence in Saudi Arabia. (Reuters)

May 31 Mexican Energy Minister Felipe Calderon resigns unexpectedly after being criticized by President Vicente Fox for his political activities. This is expected to further delay efforts by the Fox administration to reform Mexico’s energy sector. (Reuters)

June 2004

June 1 Near-month crude oil futures on the NYMEX reach a record nominal settlement high of $42.33 per barrel, with traders thought to be reacting to the weekend terrorist attacks in Saudi Arabia on top of an already tight market. This is the highest nominal settlement price since the founding of the NYMEX crude oil futures market in 1983. (WSJ)

June 2 Mexican President Vicente Fox appoints Fernando Elizondo Barragan as Mexico’s new Minister of Energy, after the resignation of his predecessor on May 31. At the inauguration of the new minister, President Fox states, “We need to continue with large investments, and get through the necessary energy reforms.” (NYT, DJ)

June 2 India’s Petroleum and Natural Gas Secretary, B.K. Chaturvedi states, “By the end of this year, we will begin working on the project [of building a strategic petroleum reserve]. By late 2007, India's strategic oil reserves should be ready.” In January, the previous government approved an oil security plan to create 5 million metric tons of strategic oil reserves. (DJ)

June 3 OPEC Ministers meeting in Beirut agree to raise OPEC production quotas by a combined 2 million barrels per day effective July 1 and a further 500,000 barrels per day effective August 1. This will bring the combined quota in August for the 10 OPEC countries participating in the quota system (Iraq does not participate) to 26 million barrels per day. Crude oil prices fall somewhat in response to this news. OPEC is scheduled to meet again on July 21 to review this decision. (AP)

June 3 Electoral authorities in Venezuela announce that 2.45 million valid signatures have been obtained for a referendum on the presidency of Hugo Chavez, surpassing the minimum of 2.44 million required for a referendum to go forward. President Chavez indicates that he accepts the referendum, which is likely to take place in August. If President Chavez loses the referendum, he will be recalled, according to Venezuela’s constitution. (Reuters)

June 3 Nigeria’s 125,000-barrel-per-day crude oil capacity Warri refinery resumes operation after being offline since April 2003, according to the Nigerian National Petroleum Corporation. It does not begin operation at near full capacity, as engineers are still testing certain operations. Nigeria, despite being one of the world’s largest crude oil exporters, has had to import the majority of its finished petroleum product demand because the country’s four refineries run at about 30% of capacity and even when operating near capacity are inadequate to supply gasoline demand. (Reuters)

June 4 U.S. Assistant Secretary of Commerce William H. Lash announces that Libya has sent its first shipment of crude oil to the United States since the resumption of ties between the countries in recent months. (AP)

June 5 The Nigerian military kills 17 bandits in the oil-rich Delta state as part of an effort to combat oil theft, piracy, and kidnappings of oil workers in the area. Such criminal activity has contributed to Nigeria’s inability to produce crude oil at full capacity. Local civil organizations accuse the military of killing innocent civilians, not involved in criminal activities, in the crackdown. Fighting continues on June 13, when one soldier and several more alleged criminals are killed. (Reuters)

June 6 A law is approved in Kuwait that will allow the country to partially privatize the downstream sector. A new company for retail petroleum product sales will be created that will have the state-owned Kuwait National Petroleum Company as a minority stakeholder. This is the first step of efforts by Kuwait’s Supreme Petroleum Council to privatize part of Kuwait’s petroleum sector, particularly the downstream operations. (Reuters)

June 9 Saboteurs explode a portion of a key oil pipeline in northern Iraq, about 125 miles north of Baghdad, stopping the flow of crude oil from the Kirkuk field to Iraq’s largest refinery at Baiji. Also, an explosion and fire at a power plant near the refinery forces a 10% cut in electricity to the national grid. It is unclear whether the fire at the power plant was accidental or an act of sabotage. Crude oil exports to Ceyhan remain suspended until June 23. (WP, AP, Reuters)

June 14 Dominion Power and Statoil of Norway announce an agreement on a 20-year contract giving Statoil access to increased capacity at the Dominion Cove Point liquefied natural gas (LNG) plant in Maryland. As part of the deal, the regasification facility will expand its capacity by 800 million cubic feet per day and its on-site storage facility by 6.8 billion cubic feet by 2008. Smaller associated transport and storage projects in Maryland and Pennsylvania will also be built by 2008. (DJ)

June 15 Saboteurs attack two oil pipelines in southern Iraq, bringing a temporary halt to much of Iraq’s oil exports as the Basra Oil Terminal is closed. Recently, total Iraqi exports had reached as high as 1.8 million barrels per day of crude oil. Pumping resumes on a limited basis on June 21, and is close to normal by June 25. (WSJ, Reuters)

June 15 Workers of French state energy companies Electricite de France and Gaz de France go on strike in protest over plans to privatize the two companies. Workers reduce electricity output by about 15% on June 15 and by 10% on June 16. A 225-kilovolt line between France and Spain is also cut, and reductions are targeted at areas where prominent politicians live and at national landmarks as the strike continues throughout the month. The striking workers also cause delivery reductions at two LNG terminals. (Reuters)

June 17 Atmos Energy announces that it has agreed to acquire the natural gas operations of TXU Corporation for $1.93 billion. This will transform Atmos into one of the largest distributors of natural gas in the United States, and particularly in Texas, where Atmos will control 6,800 miles of pipeline. The deal also reflects TXU’s efforts to focus on its core electricity business. (NYT)

June 18 Norwegian oil workers from the OFS Union go on strike, halting production at the Snorre and Vigdis fields on June 19, and the Ekofisk platform on June 22. This takes a total of 375,000 barrels per day of crude oil offline. Production of about 62.2 million cubic feet of natural gas per day is also taken offline. This same day, the Norwegian Prime Minister appoints a new Minister of Oil and Energy, Thorhild Widvey, formerly deputy foreign minister. She states that there will be no change in the country’s energy policies. (DJ, Reuters)

June 22 The Secretary of State for Mines and Energy of Equatorial Guinea, Gabriel Nguema Lima, announces that the country’s national oil company, GEPetrol, has signed a contract with Marathon Oil of the United States for the construction of a $1.4 billion liquefied natural gas liquefaction and export facility. The plant will produce 3.4 million metric tons a year and will begin operating by 2007. (DJ)

June 25 The Norwegian government orders striking oil workers back to work after an eight-day strike, with binding arbitration to ensue. Around 375,000 barrels per day of crude oil production are brought back online over the following few days. (Reuters)

June 28 The United States and Libya formally resume diplomatic relations, which had been severed since May 1981. Assistant U.S. Secretary of State William Burns opens a U.S. liaison office in Tripoli, and Libya plans to open a similar a similar office in Washington, D.C., according to the Department of State. Libya holds the largest proven oil reserves in Africa, according to some estimates. (Bloomberg)

June 28 Parliamentary elections are held in Canada. Canadian Prime Minister Paul Martin’s ruling Liberal party loses seats and a majority, but retains a plurality in parliament. The Liberals will stay in government as a minority in coalition with the New Democrats, with Paul Martin continuing as Prime Minister. Canada is one of the world’s largest energy consumers and producers, and a major source of U.S. energy imports. (Reuters)

June 28 The transfer of sovereignty in Iraq from the Coalition Provisional Authority (CPA), led by U.S. diplomat Paul Bremer, to an interim Iraqi government, led by President Ghazi al Yawer and Prime Minister Iyad Allawi occurs, two days ahead of schedule. It is hoped that a government led by Iraqis will be more acceptable than the CPA to many Iraqis. Legal, though not physical, custody of former Iraqi dictator Saddam Hussein is awarded to the new Iraqi government on June 30. (Reuters)

June 29 Royal Dutch/Shell announces that it began pumping natural gas on June 23 from a world record depth of 7,570 feet of water in the U.S. Gulf of Mexico at the company’s Coulomb project. The twin wells will produce about 100 million cubic feet of natural gas per day for the U.S. market. (Reuters)

June 29 The U.S. Environmental Protection Agency releases a report showing that 243 counties of the United States, with about 99 million residents, fail to meet national air standards for fine particle pollution. The air in these counties makes for an increased risk of health problems. The source of this pollution is mainly diesel vehicles, thermal power plants, and other industry. Eventually, state and local officials will have to devise plans to reduce the pollution. (WP, NYT)

June 30 The U.S. Energy Information Administration (EIA) releases a report showing that carbon dioxide emissions from energy sources in the United States increased by 0.9% in 2003, from 5,736 million metric tons of carbon dioxide in 2002 to 5,788 million metric tons in 2003. The upward increase is attributed to increased economic growth, colder winter weather, and more reliance on coal and petroleum, rather than natural gas, for electric power generation. (EIA)

July 2004

July 3 Royal Dutch/Shell Group says that the overstatement of its proven oil and natural gas reserves resulted in profits being exaggerated by $276 million, and that “inappropriate” accounting in other areas resulted in profits being embellished by an additional $156 million. (NYT).

July 5 Following the registration of reserves at the Koushk and Hosseinieh fields, Iran announces that it now holds the world's second-largest conventional oil reserves. The two fields have now been reclassified as a single field, Yadavaran. According to this report, Iran now possesses larger reserves than Iraq. (WMRC)

July 5 The Iranian oil minister states that Iran’s production capacity is expected to increase to 4.3 million bbl/d by March 2005, from its current level of 3.9 million bbl/d.(WMRC)

July 8 Natural gas production from Algeria’s In Salah fields, operated byBP, Statoil, and Sonatrach, begins ahead of schedule. Initial production was expected to begin in October 2004. The gas fields will add about 848 million cubic feet per day (Mmcf/d) to the nation’s overall natural gas production, with eventual output from the fields reaching as high as 1.8 billion cubic feet per day (Bcf/d). Most of this gas is destined for the Southern European market. (WMRC)

July 9 Inan attempt to avoid bankruptcy, the beleaguered Russian oil giant Yukos reportedly offers to pay $7.5 billion in back taxes over three years. The company has already failed to meet a July 7, 2004, deadline for repayment of $3.4 billion in back taxes. According to analysts, the total bill could eventually rise to $10 billion. The Russian Finance Minister Alexei Kudrin however, refuses to grant the troubled oil giant an extension, marking yet another rejection by the Russian government to allow Yukos to settle accumulating back taxes. (G & M, Reuters)

July 12 According to International Energy Agency (IEA) Executive Director, Claude Mandil, Russian oil production will not be significantly impacted in the short term by the legal turmoil at Yukos. Mr. Mandil declares, “ Today it's not a worry because so far Yukos output has not been seriously diminished and if it is, it will be replaced by other Russian companies." (Reuters)

July 13 Rejecting lower figures issued by the IEA regarding its oil production, Venezuela, the world's fifth largest oil exporter, releases statements indicating a crude oil production level of 3.1 million bbl/d. According to Venezuelan Energy Minister, Rafael Ramirez, "We can confirm and show that our petroleum production is at levels established by OPEC, that we are meeting all of our obligations.” (DJ)

July 13 According to Kuwaiti Energy Minister Ahmad al-Sabah, the $6 billion “Project Kuwait,” involving the development of six northern oilfields with the assistance of foreign companies, will be launched by the end of 2004. The project hopes to increase production at six northern oilfields from 588,000 bbl/d to 1.2 million bbl/d. (WMRC)

July 15 China's National Oil & Gas Exploration & Development Corp. (CNODC) and Kazakhstan's Transneftegaz establish a joint venture (JV) to build an oil pipeline linking the two countries. CNODC, a unit of China National Petroleum Corp. (CNPC), and Transneftegaz, the oil and gas transportation arm of Kazakhstan's state oil and gas company Kazmunaigaz, will each hold a 50% stake in the JV, which is slated to begin constructing the second phase of an 808-mile (1,300-km) pipeline this year from Atasu to Alashanku on the Kazakh-Chinese border. (WMRC)

July 15 OPEC agrees to raise its crude oil production target by 500,000 barrels (2% of current OPEC production) by August 1—in an effort to moderate high crude oil prices. (WSJ)

July 18 Bolivians vote in favor of five referendum questions concerning the nation’s hydrocarbon production, specifically natural gas. The questions asked of Bolivians include whether the Hydrocarbons Law should be repealed; whether the state should recover all ownership of hydrocarbons; whether the state-owned oil companies should reclaim partly-privatized companies in the country; whether voters agree with President Mesa’s attempts to reclaim access to the sea; and whether gas should be exported under a national policy framework. (Bloomberg, The Economist, WMRC)

July 22 Yukos warns that it could go bankrupt within three weeks because of the government’s decision to freeze its assets and bank accounts, jeopardizing the operations of Russia’s largest oil producer and potentially disrupting the company’s exports to world markets. (WP)

July 26 Syria and Iraq sign an oil cooperation accord involving the exchange of Syrian petroleum products, kerosene, benzene and liquefied gas, in exchange for Iraqi crude oil. (WMRC)

July 28 Steven M. Theede, the top manager of Yukos, states that the company is continuing oil production despite news reports that suggest the Russian government will force the company to shut down its production. According to Theede, the production subsidiaries of Yukos received a government notice last week barring them from selling property. The company’s attorneys were trying to determine whether the ban considers crude oil to be property. (WP)

July 29 Royal Dutch/Shell Group announces that it will pay a total of nearly $151 million in fines to U.S. and British authorities for overstating its oil and natural gas reserves. (WP)

July 30 A major natural gas pipeline explodes in Belgium, killing as many as 15 people and injuring more than a 100. The pipeline carries natural gas from the Belgian port of Zeebrugge to northern France. (CNN,WT)

August 2004

August 2 Iran and Iraq agree to a framework for a crude oil swap and transit agreement. This arrangement will allow Iraq to find an alternate route for its exports, which have been subject to frequent sabotage and outages. (WMRC)

August 4 In preparation for an auction of its 7.6% stake in Lukoil, the Russian government sets a minimum price of $1.26 billion for its shares. Lukoil is the second largest oil company in the world as measured by proven hydrocarbon reserves.Analysts expect that the sale will help restore investor confidence which has been adversely affected by recent government actions taken against Yukos.(NYT)

August 4 In an effort to provide landlocked Bolivia greater access to world energy markets, Bolivian President Carlos Mesa signs a letter of intent with his Peruvian counterpart, Alejandro Toledo, allowing Bolivia to use the Peruvian port of Ilo to export liquefied natural gas (LNG) to Mexico and the United States. (WMRC)

August 9 The Russian government disregards the August 6 ruling of a Moscow court and seizes the main production unit of Yukos, Yuganskneftegaz. On August 6, the court had declared that the Russian government’s seizure of Yuganskneftegaz was illegal, a decision which had marked the first major court victory for Yukos since Russian authorities began proceedings against the company more than a year ago. Furthermore, on August 5, the government had unexpectedly withdrawn permission for Yukos to use its financial assets to continue operations, reversing a decision made 24 hours earlier. (WP, WSJ)

August 10 Salym Petroleum Development (SPD), the 50:50 joint venture between Shell and Evikhon (a majority-owned subsidiary of Sibir Energy) in Western Siberia, announces that it has begun oil production at the Upper Salym field. The company states that its first exploration well, drilled to a depth of 7,597 feet (2,316 meters), struck oil in the Bonus structure of the Upper Salym field. (WMRC)

August 11 In an effort to reign in high oil prices, Saudi Arabia announces that it can increase production by as much as 14%, an estimated 1.3 million barrels per day (bbl/d), if needed. The Saudi announcement, however, does little to assuage oil markets as prices continue to rise, with NYMEX crude up $0.28 per barrel at the close of trading to $44.80 per barrel. (USA,WMRC)

August 15 Despite protests from the opposition that the referendum was unfair, Venezuelan President Hugo Chavez wins a recall vote, allowing him to stay in office for the remaining 2 years of his term. According to Venezuela’s National Electoral Council, 58% of the voters back Chavez. (Reuters)

August 23 During a conversation with U.S. President George Bush, Russian President Vladimir Putin states that Russian oil companies will continue to increase production and exports in an effort to reduce rising global oil prices. (WMRC)

August 24 Despite U.S. oil prices approaching $50 a barrel, the International Energy Agency (IEA) declares that there are no current plans for the nations of the Organization for Economic Cooperation and Development (OECD) to tap strategic oil reserves. (DJ)

August 24 Nigeria’s senate issues a resolution requiring Royal Dutch/Shell Group to pay $1.5 billion in compensation to the Ijaw people of the Niger River Delta. During the last half-century that it has been producing oil in the region, the company’s operations have reportedly led to health problems and environmental damage. (WSJ)

August 25 U.S. Vice President Dick Cheney declares that the United States will only release oil from the Strategic Petroleum Reserve in the event of a serious supply emergency, described as the loss of 5-6 million barrels per day out of the approximately 20 million barrels per day consumed by the United States. (Bloomberg, WMRC).

August 27 Following week-long discussions between Russian and Chinese energy officials in China, Russia’s state-owned gas company Gazprom announces the signing of a bilateral agreement between the two nations. The agreement focuses on hastening construction of a Russia-China natural gas pipeline. (WMRC)

August 30 Iraq's State Oil Marketing Organisation (SOMO), the body that oversees Iraqi oil export sales, signs an oil supply agreement with the Turkish state oil refiner Tupras for deliveries from September through December 2004. The agreement marks the first term deal signed by SOMO for the export of oil via the Kirkuk (Iraq)-Ceyhan (Turkey) oil pipeline since the U.S.-led invasion of Iraq in March 2003. The deal calls for Tupras to purchase 2 million barrels per month over the term of the contract. (WMRC)

August 30 According to officials at Mexico’s state-owned oil company, Petroleos Mexicanos (Pemex), large new oil deposits have been found in the Gulf of Mexico, potentially bringing the nation’s total reserves to 102 billion barrels. The company’s head of exploration and production, Luis Ramirez, states that the oil find can “put us on a par with reserves levels of the big players like Iraq, United Arab Emirates, Kuwait, or Iraq.” Global industry analysts, however, doubt the claims of Pemex cautioning that since actual drilling has not taken place, Pemex’s reserve numbers are only estimates. (WP)

September 2004

September 2 A new International Atomic Energy Agency (IAEA) report states that Iran converted as much as 77 pounds of raw uranium (yellowcake) during early 2004, and the country plans another larger test this month. The test would entail 40 metric tons of raw uranium, enough to make 220 pounds of weapons-grade uranium. (WP)

September 2 Mild weather causes a decrease in air conditioning demand and natural gas futures prices respond by falling below $5 per million British thermal units (MMBtu). This is the lowest level since November 2003. (NYT)

September 2 OAO Yukos, Russia’s largest oil producer, announces that a court ruling would “paralyze” the company’s operations because the ruling would seize $2.63 billion in the accounts of the company’s main production unit and refinery. Prompt month NYMEX oil prices increase over $1 per barrel in intraday trading after this announcement to close at $44.06 per barrel. (WSJ, NYT)

September 7 Hurricane Frances interrupts regular gasoline supplies to Florida. Four gasoline tankers unload 125 million gallons of fuel after the storm to replenish supplies as 2.5 million people are evacuated. Gulf of Mexico production area avoids expected damage from the Hurricane. (AP, NYT)

September 13 State-owned China National Offshore Oil Corp (CNOOC) signs a sale contract for liquefied natural gas (LNG) it would import from the BP-led Tangguh project in Indonesia. In addition to the contract entailing the sale of gas to five city-piped gas firms and three power plants in Fujian is an agreement on LNG transportation for the terminal project. The construction of the LNG terminal will cost $560 million and will have an initial expected capacity of 3 million metric tons per year. The joint venture partners also sign a 25-year gas sales-and-purchase agreement with the Tangguh LNG project partners for 2.6 million metric tons/year of supply starting in 2007. (Platts)

September 14 In the biggest disruption of the region’s output in at least two years, Hurricane Ivan forces Shell Oil Co.,ChevronTexaco, ExxonMobil, and Total, to shut some hundreds of thousands of barrels per day of Gulf of Mexico oil production as the companies evacuate more than 3,000 workers from the offshore platforms. Oil tankers from Venezuela also face a three-day delay on deliveries to the United States because of the hurricane. The U.S. Minerals Management Service reports that Ivan has reduced Gulf Coast oil production by 61%. (Bloomberg, DJ, Reuters).

September 14 Saboteurs blow up an oil pipeline in northern Iraq, preventing export of approximately 200,000-300,000 bbl/d in crude oil deliveries to Ceyhan from northern Kirkuk oilfields. Engineers say they will need 3-7 days to repair the pipeline, and exports resume September 23. (AP)

September 15 OPEC ministers meet in Vienna and announce plans to lift member countries' oil supply quotas by one million barrels per day, or four percent. Official output allocations for 10 OPEC countries will rise to 27 million bbl/d, from 26 million bbl/d, beginning November 1. (WP, Reuters)

September 15 Gazprom, the Russian state-controlled natural gas company, announces it will take over Rosneft, the state oil firm. By executing the stock swap, the state increases its ownership percentage in Gazprom from 38% to 50% and transforms what is already the world’s largest natural gas producer (20% of world gas production) into a significant oil producer as well. The combined company would have a value of $5.89 billion and would hold oil and gas reserves of about 117.7 billion barrels of oil equivalent. The swap will also make it possible for foreign companies to buy directly into the company. (WP, WSJ)

September 16 A pipeline explodes in Nigeria leaving 15 people dead after a fire ignited near the pipeline. Some of those killed and injured were siphoning petroleum from a vandalized pipeline. (DJ)

September 20 Russian oil company Yukos announces that it is immediately reducing its rail exports of crude oil to China by approximately 100,000 bbl/d. This marks the first time that Yukos’ tax dispute with the government has hindered its ability to transport oil. Yukos expects the reductions to continue for approximately one month. (WSJ, NYT)

September 20 President Bush lifts a variety of U.S. sanctions on Libya, paving the way for American oil companies to try to secure contracts or revive previous contracts for tapping Libya’s oil reserves, estimated at approximately 36 billion barrels. (NYT)

September 21 OPEC-member Indonesia holds a peaceful election in which 100 million people vote for a new president despite the threat of terrorist attacks. Preliminary results show that Susilo Bambang Yudhoyono, a retired general and former security minister, wins a resounding victory over President Megawati Sukarnoputri. (WSJ)

September 23 The Energy Information Administration (EIA) reports that proven U.S. crude oil reserves slipped by 3.5% in 2003 to 21.9 billion barrels, the first decline in five years. Total oil discoveries were 1.2 billion barrels in 2003, 30% more than a year earlier and 16% more than the 10-year average. Most of the new oil discoveries were in the Gulf of Mexico. U.S. natural gas reserves moved higher in 2003, marking the fifth straight year U.S. gas reserves have increased. (Oil Daily)

September 24 In the aftermath of Hurricane Ivan, U.S. Secretary of Energy Spencer Abraham agrees to release 1.7 million barrels of oil in the form of a loan from the Strategic Petroleum Reserve. Refineries are reporting supply shortages due to cuts in production and delayed imports. Prices of NYMEX WTI prompt month crude oil rise $0.42 to $48.88 per barrel for the prompt month contract despite the release. About 472,000 bbl/d of crude oil production remains shut-in, along with 2.3 billion cubic feet per day (bcf/d) of natural gas production. The U.S. Minerals Management Service (MMS) reports that cumulative total federal offshore oil production lost to date is 9.6 million barrels of crude oil and 40.9 billion cubic feet of natural gas. (NYT)

September 28 The Niger Delta People Volunteer Force in OPEC-member Nigeria issues a statement warning multinational oil companies to shut production and withdraw staff in preparation for “an all-out war on the Nigerian state.” Companies respond by heightening security around Nigerian oilfields. (Reuters)

September 29 Construction begins on the 613-mile long oil pipeline from Atasu, in northwestern Kazakhstan, to Alataw Pass in China's northwestern Xinjiang region. The pipeline’s completion date is December 2005 at an estimated cost of $700 million. China and Kazakhstan’s respective national oil and gas companies signed the agreement in May 2004. The pipeline will be able to carry approximately 192,000 bbl/d of oil once completed in 2005, and consortium owners are planning eventual capacity expansions. (DJ)

September 30 Lasting effects of Hurricane Ivan, the most disruptive hurricane to the U.S. Gulf Coast production zone since 1992, have caused shut-ins of 12.9 million barrels of oil production since Sep 11, with about 485,000 bbl/d still shut in. (Reuters)

September 30 ConocoPhillips announces a $2.36 billion strategic alliance with OAO Lukoil, under which Conoco will buy a 7.6% stake in the Russian oil company and get a share in joint projects. The deal provides Conoco access to Russia's enormous but largely undeveloped oil and natural gas reserves and opens a possible avenue for it to become the first Western petroleum producer to return to Iraq. Conoco also announces plans to raise its stake to 10% by year-end and to 20% within two to three years, which would cost about $3 billion at current prices. (WSJ)

October 2004

October 1 The Niger Delta People's Volunteer Force (NDPVF) agrees to a settlement, averting threats of an "all-out war on the Nigerian state." During the previous week, the NDPVF had threatened attacks on oil installations and had caused oil companies to increase security and evacuate workers from pipelines around the country. (Reuters)

October 4 French fishermen mount a two-day-long blockade at the Lavera-Fos refinery to protest high fuel prices. The protesters hold up exports of refined petroleum products to West Africa and the United States at a key inlet for liquefied natural gas (LNG), but crude oil exports experience no interruptions. (Reuters)

October 5 The American Petroleum Institute (API) reports that September 2004 crude oil production in the United States hits a 55-year low of 5 million barrels per day after Hurricane Ivan caused significant damage to oil and gas infrastructure in the Gulf of Mexico. (WP)

October 7 Charles A. Duelfer, the top American arms inspector in Iraq, releases his long-awaited report on the Iraqi Oil-for-Food program that describes Saddam Hussein’s network of front companies and questionable deals with foreign governments. Hussein’s government reportedly earned $11 billion in illicit revenue from the program during the 1990s. The report shows in great detail the lucrative oil vouchers Hussein provided to Russia, France, Belarus and other countries which acted as middlemen and resold the oil at a profit. (NYT, WP)

October 12 ChevronTexaco announces another 'significant' deepwater oil discovery off the West coast of Africa located between Angola and Congo. The company said the find, which contains 40 degrees API gravity crude oil, would be evaluated to determine the full size of the field. ChevronTexaco holds a 15% stake in the project, and its major development partners include Total, Sonangol, CABCOG, and ENI. Congo and Angola would share revenue from any future oil development. (WMRC)

October 14 Sakhalin Energy, in which Japanese firms Mitsui and Mitsubishi are partners, obtains its first term supply deal with North America by signing an agreement with Coral Energy, a unit of Royal Dutch/Shell, to supply approximately 1,800 billion cubic feet (bcf) of LNG over 20 years to a power plant on the border of Mexico and California. Coral Energy will market the excess gas. (Reuters)

October 14 The European Union (EU) formally reprimands 18 European governments for failing to pass laws deregulating their national natural gas and electricity markets. The official reprimands are the first step towards filing a case in the European Court of Justice. Under EU law, all 25 member nations should have opened their markets by July 1, 2004. (WSJ)

October 16 The long-awaited Baku-T’bilisi-Ceyhan (BTC) oil pipeline reaches a landmark event when presidents from Azerbaijan and Georgia symbolically link two portions of the pipeline together. The pipeline, which crosses Azerbaijan, Georgia, and Turkey, will be finished in March 2005. The first tanker is expected to load during the second half of 2005. The pipeline is expected to reach transport levels of 200,000 bbl/d in 2005 and 1 million bbl/d by 2008. (Reuters)

October 18 Average U.S. retail diesel prices jump $0.088 per gallon to $2.18 per gallon in the past week according to the Energy Information Administration. The price rise continues a five-week trend during which new record-highs have been set and broken. The new price is $0.67 per gallon higher than a year ago. (DJ)

October 19 Saboteurs in Iraq attack and ignite an oil pipeline about seven miles from the Bayji oil refinery. This particular pipeline has been subjected to repeated sabotage attacks since the U.S.-led invasion of Iraq last year. Iraqi officials maintain that the attack will not interrupt fuel supplies to the Turkish export facility at Ceyhan. (AP)

October 20 Yukos, the Russian oil company, resumes its oil shipments via rail. The company had reduced oil shipments by 100,000 bbl/d two weeks earlier after the Russian government had frozen some of its accounts. Yukos had been unable to pay the rail shipper for transportation charges. (Reuters)

October 21 Chinese state-run company Petro China concludes a natural gas sales agreement with BASF-YPC (a 50-50 chemical plant joint venture between BASF and Sinopec Corp) to deliver approximately 21 bcf/year to Petro China’s $8 billion West-East pipeline. The 2,610-mile pipeline links gas fields in the remote western region of Xinjian to the growing city of Shanghai on the eastern seaboard. (Reuters)

October 21 A bill to allow consumers to choose their gas suppliers beginning in 2007 passes the lower house of the Czech parliament. The bill will gradually open up the country's gas market to competition and was approved by 151 votes in the 200-seat lower house. The legislation still must pass the upper house of parliament and President Vaclav Klaus must sign it into law. (WMRC)

October 22 The NYMEX WTI prompt month crude oil contract price closes at an all time high of $55.17 per barrel after the Energy Information Administration reports a fifth straight weekly decrease in U.S. heating oil stocks. Lasting effects from Hurricane Ivan have also forced the shut-in of natural gas and crude oil production from the Gulf Coast. (NYT, CNN)

October 25 The Norwegian government intervenes in a dispute between unionized rig employees and their employers that would have shut down all of the country’s 3 million bbl/d of crude oil production and 7 bcf per day of natural gas exports. The government intervention ended the union’s dispute over contract terms even though the union pledges to continue to press its demands. The strike that began at the beginning of July reduced oil production by 55,000 bbl/d and delayed drilling of new production and exploration wells. (Reuters)

October 27 Saudi Arabia's state oil company, Saudi Aramco, makes a new oil discovery in the Abu Sidr region, located some 115 miles south of Riyadh in central Saudi Arabia. The test well drilled by Aramco earlier during October resulted in flows of 3,000 bbl/d of super-light crude. Since most of the spare capacity in Saudi Arabia is heavy crude, this find is significant, and it increases the likelihood that the new discovery will reach world oil markets. (WMRC)

October 28 After its approval by the Russian cabinet and the lower half of the Russian legislature earlier in October, the upper house of the legislature ratifies the Kyoto Protocol global climate treaty and returns it to the executive branch for its approval. Russian ratification is necessary for the Protocol to take effect because participating countries must have been responsible for 55 percent of global emission in 1990, and Russia is the only remaining country that can trigger the 55 percent threshold. One of the Protocol’s main tasks is to implement a reduction in emissions of the six greenhouse gases to 1990 levels by 2012. The Bush administration announced three years ago that it would not join the accord. (WP, USA Today)

October 29 China raises its benchmark interest rate for the first time in nine years putting pressure on raw materials and energy stocks. The Chinese move could potentially lower the country’s demand in comping years, and oil prices fall in response. Prompt month NYMEX WTI crude oil prices drop for the third day in a row by $1.54 to $50.92 per barrel. (NYT)

October 29 Sempra Energy receives all the permits necessary to construct North America’s first West Coast LNG plant in Mexico. The facility will provide natural gas to California and other Western states. Sempra will construct the $1 billion terminal and pipelines to deliver approximately 1 billion cubic feet per day, or 15% of California’s current natural gas consumption. (LA Times)

October 29 The Indian Oil Corp. (IOC)'s Koyali refinery in the western state of Gujarat closes after a major explosion and fire earlier today. At least 16 people are injured in the blast at the refinery, India’s second largest and the largest operated by IOC. The company claims that the 185,000 bbl/d refinery will be up and running within three days, although part of the refinery was already closed for maintenance before the accident. (WMRC).

October 31 A technical breakdown in Kuwait causes a three-hour power outage that shuts down three state-owned oil refineries with a total capacity of 920,000 bbl/d. Reports indicate that an electricity network feeder shut down and also cut power to four of the five large power generation and water desalination plants inside the country. (CBS Marketwatch, AFP)

October 31 Iraq’s oil minister, Thamer al Ghadhban, announces that Iraq’s interim government had allocated approximately $1.2 billion for investment in the upstream oil sector in order to increase the country’s oil production by 45% from 2.2 million bbl/d to 3.2 million bbl/d over the next year.(Reuters, DJ)

November 2004

November 2 United Arab Emirates’ President Sheikh Zayed bin Sultan Al Nahyan dies. Zayed, in his late eighties, had been UAE President since the formation of the seven-member federation in December 1971. The OPEC member country produces approximately 2.5 million bbl/d. (FT)

November 2 Saboteurs mount a large attack on Iraq’s oil infrastructure by blowing up three pipelines in the north, thereby cutting exports at the Turkish port of Ceyhan. The first pipeline attack destroys a portion of the export route to Turkey, and other explosions occur in an area about 40 miles southwest of the oil producing center of Kirkuk. The explosions affect oil supplies to Iraq’s biggest refinery at Baiji and imports of refined products. Crude oil exports resumed three days later. (Reuters)

November 4 A representative from Venezuela's state oil firm PdVSA announces plans that the company will boost oil production from its eastern operations in 2005 by 100,000 barrels per day (bbl/d), or almost 10% over current eastern crude oil production. PdVSA claims that its own current production in the Eastern region is 1.05 million bbl/d, and total Venezuelan crude oil production is roughly 2.5 million bbl/d. (Reuters, Platts)

November 7 An oil tanker blocks the Suez Canal and halts navigation through the waterway. The blockage marks the first time in 30 years that the canal has been closed; the last time was during the Six-Day War in 1967. About 7.5% of the world’s trade and 1.3 million bbl/d of oil pass through the canal. Reports on November 8 predict oil exports will resume three days later. (AP)

November 9 European energy officials formally reconnect the south-eastern and western European power grids. The grids were severed following the outbreak of war in the former Yugoslavia. The Union for the Coordination of Transmission of Electricity (UCTE) began testing the grid synchronization last month, and today UCTE gave official permission for full commercial use. The grid synchronization is an important symbolic step for European political integration, and it paves the way for increased international electricity trade. (WMRC)

November 11 The first hydrogen refueling pump in the United States opens at a Shell station in Washington, D.C. Shell Hydrogen, a subsidiary of Royal/Dutch Shell Group, will run the station and pump in partnership with General Motors. (WP)

November 12 The U.S. Department of the Interior gives final approval to a plan by ConocoPhilips and Anadarko Petroleum Corp. to develop five tracts of land around the Alpine field in the Alaskan North Slope. This is the first time that commercial companies have received authorization to develop the National Petroleum Reserve. Holding approximately 330 million barrels of oil, these fields will supplement already existing production from adjacent Alpine fields that have a daily output of about 100,000 bbl/d. This is a separate area from the Arctic National Wildlife Refuge (ANWR). (Reuters)

November 15 Military activities in Fallujah are followed by increased infrastructure attacks on oil targets in Iraq over the weekend. Reports to date indicate bombs and subsequent fires at oil wells around Kirkuk, including Khabbaza, as well as an explosion at an oil pipeline north of Baghdad. Also, according to the BBC, shells have destroyed part of the pipeline linking Kirkuk to the Beiji refinery, which is 120 miles north of Baghdad. (WMRC)

November 15 Canadian Natural Resources Ltd., the second largest oil company in Côte D’Ivoire, evacuates all non-essential staff from the country after violence that erupted in the country during the previous week. Ivorian President Laurent Gbagbo's forces attacked rebel groups and bombed a French army base, killing one U.S. aid worker and nine French peacekeepers and injuring 31 others. The French government retaliated strongly by destroying much of the Ivorian air force and calling for sanctions on the Ivorian regime. (WMRC)

November 16 A U.S. Senate probe finds that Iraq illegally earned approximately $21.3 billion by circumventing UN sanctions between 1991 and 2003. The figure is double the amount reported by the Duelfer report that was released in October 2004. The Senate’s permanent Subcommittee on Investigations also releases details on the way in which Saddam Hussein manipulated the UN’s oil-for-food program. (WP)

November 16 Nigerian President Olusegun Obasanjo agrees to an across-the-board 7% reduction in pump fuel prices, leading the Nigeria Labour Congress (NLC) umbrella union and allied groups to call off a general strike planned to begin the following day. The decision follows a high-level security meeting yesterday at the President's Aso Rock official residence in the capital, Abuja. (WMRC)

November 16 Spencer Abraham resigns from his position as U.S. Secretary of Energy pending President Bush’s appointment of a replacement. (NYT, AP, Reuters)

November 18 Russian prosecutors issue a warrant for Yukos’s chief lawyer and arrest an office manager at the company's Moscow headquarters. The day before, tax police launched a fresh raid of the firm's Moscow headquarters, along with a raid of the Siberian offices of the embattled oil major's largest subsidiary, Yuganskneftegaz. Yukos’s lawyer, Dmitry Golobov, was suspected of embezzling 3 billion rubles ($104.5 m) worth of shares in a company’s subsidiary. The office manager was also accused of embezzling money via charitable contributions. (WMRC)

November 21 The President of Venezuelan state oil company PdVSA, Alí Rodriguez, moves to the Venezuelan Foreign Ministry. The Minister of Mines and Energy, Rafael Ramirez, will take over the leadership of PdVSA, as well as retain his ministerial portfolio. The move is part of a broader cabinet reshuffle. (AP, WMRC)

November 21 Production at Canada's Terra Nova oilfields halts due to an oil spill, with no indication of when operations will resume. Regulators are currently investigating the spill, which caused 1,000 barrels of crude oil to leak into the Atlantic Ocean when equipment separating water from oil malfunctioned. Terra Nova, on the eastern coast of Canada, produces approximately 105,000 bbl/d. (OGJ, Reuters)

November 22 Ukraine holds a run-off presidential election between Prime Minister Vladimir Yanukovych and opposition leader Vladimir Yushchenko. Although exit polls showed large-scale support for Yushchenko, initial official results show Yanukovych with a 2% lead. Massive opposition-led protests ensue in Kiev. Ukraine is a pivotal transit state for Russian oil and natural gas exports to continental Europe, as well as a major regional producer of coal. (NYT, AP)

November 24 Shipments of Russian, Kazakh and Turkmen crude to Iran's northern refineries in return for an equivalent amount of Iranian crude at the Persian Gulf are reportedly down 75% to roughly 35,000 bbl/d compared with 125,000 bbl/d during summer 2004. Previously, Iran had been taking crude at either the Caspian Sea port of Neka and had been sending it to the Tehran refinery or by train across Central Asia. It would then deliver an equivalent amount to the oil companies in the Persian Gulf from its nearby fields. Current economics have made it more profitable for Russian and Caspian oil to flow to Europe where prices are higher instead of to Iran. (Reuters)

November 26 Russia’s Lukoil and Venezuela’s PdVSA sign a memorandum of understanding proposing to study joint ventures and share information on projects that are of mutual interest to the companies. Lukoil reportedly aims to invest up to $1 billion, reportedly, in projects in Venezuela’s unexplored offshore zone. Both companies express a desire to launch oil and natural gas joint ventures in the Gulf of Venezuela and the Orinoco belt. (Reuters)

November 26 China announces preliminary plans to build a 90-day strategic petroleum reserve that would be completed in 2010. China also says that it has begun constructing facilities to stockpile 30 days of oil imports. These facilities entail four oil storage sites with a combined crude oil capacity of approximately 830 million barrels. (WSJ, DJ)

November 27 Both U.S.-based Marathon and Norway's Statoil are forced to evacuate staff from two North Sea production platforms after natural gas leaks were detected in two separate incidents. Marathon announces the company had to evacuate 114 non-essential workers on November 26 from three Brae area production platforms in the North Sea (around 155 miles east of Aberdeen, Scotland). The company closes production at the facility following the reported natural gas leak and is shutting-in output while inspections are carried out. Statoil also announces it has been forced to shut in over 200,000 bbl/d of oil and 'small amounts' of natural gas production at its Snorre A and Vigdis oil platforms. The company pledges to work on the problem but has not given an estimated date for the resumption of oil production. In total, the shut-ins from the Brae, Snorre A, and Vigdis fields reaches a combined 240,000 bbl/d of oil. (WMRC)

November 28 A 750-foot tanker carrying almost 320,000 barrels of crude oil rips open as it tries to dock at a Citgo terminal in New Jersey. Approximately 700 barrels (30,000 gallons) leak out of the tanker to create an oil slick that is 24 miles long in the Delaware River. The spill kills or injures hundreds of birds and fish, and mobilizes animal rescue and containment efforts. The total shoreline damage is estimated at approximately 107 miles. (NYT, LATimes)

November 30 Saudi Arabia’s oil minister commits to boost the country’s crude oil production capacity by as much as 14%, to 12.5 million bbl/d, in the next few years to keep up with rising demand. Ali Naimi, the oil minister, pledges to keep spare capacity at “no less than” 1.5 million bbl/d above current production levels. This is the first time the minister indicates that the political leadership of Saudi Arabia is committed to large-scale capital investment for production increases. (WSJ)

December 2004

December 5 Around 300 unarmed Nigerian villagers - including women and children - from the Kula community in Rivers State in the Southern Niger Delta, seize three oil flow stations operated by multinational oil companies Shell and ChevronTexaco, shutting in 100,000 barrels per day (bbl/d) of production for one week. A community spokesman claims that his people are protesting because they feel they have been overlooked for jobs. The incident is the second attack on oil flow stations in the Niger Delta in two weeks. (WMRC)

December 6 Suspected Al Qaeda-linked militants attack a U.S. consulate in Jeddah, Saudia Arabia. Twelve people die in gun battles, and eight people are taken hostage before security forces regain control. No U.S. diplomats are killed. Saudi Arabia is OPEC’s leading oil producer, and the attack raises concerns on Saudi security. As a result, NYMEX WTI prompt-month crude oil prices rise 44 cents to $42.98 per barrel from the previous day’s close. (Reuters)

December 7 Norway 's Ministry of Petroleum offers 2l companies operating in the North Sea and Norwegian Continental Shelf (NCS) 28 production licenses and will receive offers for a participating interest in 55 blocks or parts of blocks. The acreage is part of Norway 's efforts to encourage exploration in mature areas. (WMRC)

December 7 Brazil 's electricity regulator ANEEL holds Brazil 's largest-ever power auction, offering contracts for 55,000 megawatts (MW) of power. The eight-year contracts were for delivery from 2005, 2006 and 2007. Eighteen generators and thirty-five distributors participate in the auction with the federal power-holding group, Eletrobras, selling the largest volume of power. Brazil currently has a surplus of generating capacity. But the supply outlook beyond 2008 is less certain, and new plants are needed in order to avert future shortages. The auction results in lower electricity prices than were originally expected, and this will reduce incentives for investors to add new generation. (DJ)

December 10 Iraq resumes pumping Kirkuk crude oil to the Turkish Mediterranean port of Ceyhan at a rate of 450,000 barrels per day after a 12-day halt, according to shipping sources. The pipeline from the Kirkuk fields had been idle since November 28, when it briefly pumped enough crude oil to allow a million-barrel tanker to fill. (DJ)

December 10 In its quarterly meeting, OPEC agrees to cut production of crude oil to official quota levels. The OPEC Ministers say the cartel will lower crude oil production by 1 million bbl/d effective January 1. Currently, ten of OPEC’s members are exceeding their 27 million bbl/d official quota by 1 million bbl/d ( Iraq does not have a quota). OPEC members pledge to meet again on January 30 to discuss whether further cuts are necessary. Saudi Arabia plans to decrease crude oil output by 500,000 bbl/d starting on January 1, 2005. (NYT, AP, WP)

December 14 Saudi Arabia ’s state oil company, Saudi Aramco, confirms plans to restart the three mothballed oil fields of Abu Hadriyah, Khursaniyah and Fadhili. These fields have total reserves of around 6.8 to 7.4 billion barrels. Revitalizing these three fields is part of a 3-year plan to increase Saudi oil production capacity by 1.5 million bbl/d to 12.5 million bbl/d. (DJ)

December 14 Technical problems on the Pedro Duran Farell natural gas pipeline running from Algeria via Morocco to Cordoba in Spain reduce supplies of Algerian gas to Spain and southern Europe , causing interruptions to the operation of over 1,400 MW of power generation capacity by Spanish operators. Reports blame problems at a compressor station for the reduced supplies, although exact details on the level of the shortfall remain unclear. The roughly 860-mile (1,385-km) pipeline has the capacity to transport almost 390 billion cubic feet (Bcf) of Algerian gas per year. (Platts, WMRC)

December 18 Yuganskneftegaz, the largest subsidiary of Yukos, is auctioned off to a previously unknown company called Baikal Finans Group (BFG) for a well-below-market value of $9.4 billion. The unit is being sold to help cover more than $27 billion in tax claims the Russian government says it is owed by Yukos over the last year -- part of a broader campaign against the company and its founder, Mikhail B. Khodorkovsky. Under threat of having the government auction its largest oil asset, Yukos filed for bankruptcy in a U.S. court in Houston , Texas earlier in the week. In response, many banks that were preparing to back Gazprom in its bid for the oil unit dropped their support. Russian state-owned oil company Rosneft buys all of BFG five days later. (WSJ, NYT)

December 20 Exelon, the United States ’ largest nuclear power producer agrees to buy New Jersey-based Public Service Enterprise Group (PSEG) for a reported $13.2 billion in stock, thus creating the largest utility in the United States . Pending some anticipated regulatory hurdles, the combined company will increase Exelon’s generating capacity about 50% to around 52,000 megawatts (MW). (Reuters)

December 23 Royal Dutch/Shell Group and ChevronTexaco announce that local protests will affect about 10%, or approximately 114,000 bbl/d, of their Nigerian oil deliveries. After continued disruptions since the beginning of the month, the companies declare a force majeure. Now, buyers may face delays of about eight days for contracted oil deliveries through January. Although Shell expected "some impact" on February scheduling as well, production restarts a week later, but will take a few days to reach previous export levels. (WSJ, Reuters)

December 26 The world’s largest earthquake in 40 years triggers a devastating tsunami centered in the Indian Ocean affecting largely populated coastal areas of India , Sri Lanka , Malaysia , Indonesia , and Thailand . Almost 240,000 local residents and tourists are killed in the tidal waves, yet damage to energy infrastructure is limited. Relief aid flows into the area from all over the world, increasing the value of local currencies. (NYT, WP, AP, Reuters)

December 27 Two Canadian energy companies, Pebercan and Sherritt International, discover approximately 100 million barrels of oil in the Gulf of Mexico in an area under Cuba 's control. The deposits are expected to produce oil as early as next year. Currently, Cuba imports at least 53,000 bbl/d from Venezuela , much of it already refined into gasoline, under an agreement that allows it to purchase the oil at below-market prices. (WSJ, NYT)

December 28 Representatives from Bulgaria , Albania , and Macedonia sign a declaration giving the green light to the U.S. registered Albanian Macedonian Bulgarian Oil Corporation (AMBO) to launch the 567-mile, $1.2 billion pipeline between Bulgaria 's Black Sea port of Bourgas and Vlore , a city on Albania 's Adriatic coast. The pipeline will allow Russian and Caspian crude to avoid the crowded Bosporus Straits. The long-delayed underground line, expected to begin operation in early 2008, is expected to move up to 750,000 bbl/d. (Reuters)

December 29 Iraq resumes crude oil exports at 1.4 million bbl/d from its southern Basra terminal after bad weather stopped loadings for a day. But, exports in the north, that flow from a pumping station near Baiji to the port of Ceyhan, Turkey, remain at a standstill following sabotage attacks on December 18. Officials do not expect exports to resume for another three days. Usually the northern export pipeline can carry up to 500,000 bbl/d of crude oil. (Reuters)

December 30 LUKoil signs an agreement with a Russian railway company to send over 21 million barrels of oil to China, while state-run Rosneft plans to supply almost 30 million barrels of oil there in 2005. LUKoil and Rosneft are stepping in for embattled Russian major Yukos, which has been unable to fully meet its export commitments this year due to its liquidity crisis and the pressure on the company for back tax payments owed to the Russian government. Yukos still has committments to ship roughly 1.8 million barrels of oil by rail to China in January. LUKoil CEO Vagit Alekperov also says that his company signed an agreement with Russian Railways to deliver roughly 51 million barrels of oil per year by rail to LUKoil's Baltic Sea port of Vysotsk, from which the company will export oil to Europe via tankers. (WMRC)

December 30 A bomb explosion southwest of Kirkuk sets fire to the pipeline that extends from the oil fields in the area to the Bayji refinery, the largest in the country with a capacity of 350,000 bbl/d. The attack against oil installations in northern and central Iraq disrupts oil refining, contributes to a fuel crisis, and causes significant shortages in electricity. An official with the Northern Oil Company says the pipeline will take five days to repair. (DJ, BBC)

December 31 The Russian government gives its long-awaited final approval for a major oil pipeline to the Pacific port of Nakhodka that would allow for exports to Japan and the western United States . The decision to move ahead with the Nakhodka pipeline rules out a proposed line to Daqing , China ; however some concessions to China are expected. State oil pipeline monopoly Transneft will build a 1.6-million-bbl/d capacity pipeline from Taishet in East Siberia to the Perevoznaya Bay in the Pacific Primorsk region. The government gives no firm timeframe for the project, but says final proposals should be made before May 2005. (Reuters)

You can be automatically notified via e-mail of updates for this or any other Country Analysis Brief. To join any of our mailing lists go to http://www.eia.doe.gov/listserv_signup.html and follow the directions given.

Return to Country Analysis Briefs home page

File last modified: December 21, 2004

Contact: Michael Cohen
michael.cohen@eia.doe.gov
Phone: (202)586-7057
Fax: (202)586-9753