MODEC sees asset integrity as solution

Facing short-term headwinds from the drop in oil prices and intense competition, Japanese floating production systems lessor MODEC said it will develop asset integrity to overcome the challenges.
The company, which has clinched seven FPSO projects since 2010, is banking on its experience in

China Agrees Port, Rail Projects in Russia

By Reuters 2015-05-11 00:05:40

A China Railway Construction Corp Ltd (CRCC) unit has signed a memorandum of understanding to build rail and port projects in Russia, the firm said in a stock exchange statement on Monday.

The agreement was one of a series signed between China and Russia on the sidelines of a visit by Chinese President Xi Jinping to Moscow to mark the anniversary of the end of World War Two in Europe.

China Civil Engineering Construction Corporation (CCECC) said it had agreed with Russian firm Tuva Energy Industrial Corporation LLC (TEIC) to consult on and help source funds from Chinese institutions for projects including a 410 km (255 miles) track across the central southern part of Russia from Elegest to Kuragin.

The other projects comprise a railway line connecting the Tuvan Republic, in the same area of Russia, to western China, and a port project in eastern Russia.

CECC said the firms would sign a contract for general contracting once the projects obtained financing. It did not say what the deals were worth.

Last week, Russian Transport Minister Maxim Sokolov said the countries would invest one trillion roubles ($19.7 billion) in a rail link between Moscow and the Russian city of Kazan to be completed by 2020. Putin said the level of Chinese investment would be around 300 billion roubles.


Belize Reconsiders Offshore Drilling Ban

By Wendy Laursen 2015-05-10 19:09:50

The Central American nation of Belize has drafted far reaching regulations that could see almost all of its territorial waters made available for oil and gas exploration. The move has angered some concerned about the potential threat to the world’s second largest coral reef and the world heritage listed Great Blue Hole.

The regulations would allow drilling near the Great Blue Hole, a 124 meter deep sinkhole which is visible from space. The UNESCO protected site was listed as one of the top 10 dive locations in the world by Jacques Cousteau.

Fierce debate about offshore oil and gas production erupted in the country in 2010 after the Deepwater Horizon spill, and in 2013, the Belize Supreme Court banned offshore drilling due to safety and environmental concerns. The judge involved was concerned by a lack of experience amongst some of the local companies interested in the industry.

Tourism accounts for half of Belize’s economy, and environmental groups are concerned about the adverse impact of oil spills. However a government report released earlier this year indicated that drilling rigs could boost marine life by acting as artificial reefs.

Environmental group Oceana has been vocal in the country for a number of years and was instrumental in the 2013 moratorium. In 2012 their “people’s referendum” found that around 95 percent of the 30,000 people who voted (about 10 percent of the nation’s population) were against offshore exploration and drilling.

The government’s new draft petroleum exploration guidelines are yet to be refined,and are expected to form part of a national policy that will be presented to the Belize Cabinet.

According to local media, Princess Petroleum is the only country that currently has an oil exploration concession in Belize. It includes large areas of onshore and offshore Belize, but Princess has not commenced drilling onshore and has abandoned drilling offshore. The company’s concession expires in October.


MOAS Rescues 100 Migrants a Day

By MarEx 2015-05-10 17:39:40

Search and rescue charity Migrant Offshore Aid Station (MOAS) assisted in the rescue of almost 700 people since its vessel Phoenix set sail on May 2.

MOAS has partnered with Médecins Sans Frontières/Doctors Without Borders (MSF) which provides support to the MOAS mission and post-rescue medical care. The two NGOs combine to create the only private search and rescue service in the Mediterranean.

It is feared that 2015 will be the deadliest year yet for those risking the Mediterranean crossing. So far this year an estimated 1,750 have drowned compared to 96 deaths during the same period last year.

Since May 2nd, MOAS rescued three boats containing people fleeing from Africa and the Middle East and was asked to carry out the disembarkation of a fourth group of people rescued by another vessel.

MOAS is conducting rescues in the Mediterranean Sea for six months this year during the peak of the crisis. MOAS assisted 3,000 migrants last year when it was at sea for 60 days between August and October 2014.

“This year MOAS is seeing twice as many people rescued as last year,” said Christopher Catrambone, the co-founder of MOAS along with his wife Regina.

“The most shocking part of this ongoing tragedy is the sheer number of children, including unaccompanied children, making this dangerous crossing. It’s harrowing to imagine what these children have witnessed since leaving their homes, sometimes all the way from Syria.”

“We are very proud to be adding our professional crew and resources to the other rescue assets in the Mediterranean, most of which are commercial vessels having to face the brunt of the soaring numbers of boats in distress. Everyone is working around the clock and while commending them for their dedication we must stress that in order to save lives effectively the EU needs a dedicated search and rescue operation,” he added.

The latest rescue by MOAS saved 118 people from Syria, Somalia and sub-Saharan Africa: 80 men, 13 women and 25 minors, including nine children under five.

The operation was conducted in Force 5 swells and took almost two hours to complete.

It began when Maritime Rescue Coordination Centre Rome directed MOAS to search for a small wooden boat in distress. The Phoenix immediately dispatched a Schiebel Camcopter S-100 to search the area and managed to quickly locate the boat, discovered by the Schiebel operators to be 14 miles from its estimated position. This rapid pin-point accuracy allowed the crew of Phoenix to prepare for the rescue and medical issues.

The migrants had been sent out to sea at 3am from the coast of Libya and were scared but generally in good shape.

The Italian Coast Guard, through MRCC Rome, then requested that MOAS in partnership with MSF take on board an additional 101 persons, and disembark all the migrants in Sicily.

These rescues took place just hours after Phoenix finished disembarking another 473 people in Pozzallo, Italy. The migrants were rescued on two separate boats within 24 hours of Phoenix’s departure on May 2.

The 20 person team aboard the Phoenix includes a professional crew of camcopter operators, search and rescue professionals, medics and mariners.

MOAS’s innovative use of two high-speed Schiebel Camcopter S-100 drones on board Phoenix has already yielded excellent results. They have had nine hours of flight time in the past week and assisted during night-time rescues, ensuring that nobody is left behind.

“MOAS is providing state-of-the-art search and rescue but we are also providing post-rescue care through our partnership with MSF. In addition, we are coordinating our efforts with other vessels effectively to save lives,” said Director Brig. Ret. Martin Xuereb.

“This year we are grateful for the support of MSF, Schiebel and OGI, among others and we look to donors to extend our mission year round,” he added.

Those brought on board by the MOAS rescue crews were given an initial triage by the MSF medical team who treated conditions including diabetes, dehydration, conditions related to pregnancy, skin infections and injuries sustained during beatings and violent attacks. All those rescued receive food, water and other essential items onboard the Phoenix.


Canada’s Aboriginals Concerned about Petronas Plan

By Reuters 2015-05-10 17:12:48

Members of a Canadian aboriginal community edged closer to rejecting a roughly C$1 billion ($827 million) deal with Malaysia’s Petronas to support a liquefied natural gas export terminal, voting against the offer in the first two of three polls.

Members of the Lax Kw’alaams First Nation in the British Columbia communities of Port Simpson and Prince Rupert rejected the proposed benefit package in separate votes held this week.

A third poll will be held in Vancouver on Tuesday, with the results of all three informing the final decision of the mayor and council of the 3,600-member aboriginal band.

The Lax Kw’alaams are one of numerous aboriginal communities in talks with Petronas on the development of the $11 billion Pacific NorthWest LNG project, which is part of a broader $35 billion investment by the Malaysian company in Canadian natural gas.

Opponents of the project say it poses a threat to a salmon habitat next to the proposed terminal site on Lelu Island, and have concerns about the environmental impact of the development.

The company has said it is committed to protecting the fish and their habitat, and has already made numerous design changes to address community concerns. A federal environmental review of the proposed terminal is currently underway.

The mayor of Lax Kw’alaams, Garry Reece, said he would not comment on the process, although Facebook posts by community members confirmed the offer was voted down in both polls this week.

The offer, as outlined in a memo by the Lax Kw’alaams council and posted online, includes some C$1 billion in cash from Petronas over a 40 year period, along with a land package worth roughly C$108 million from the provincial government.

The Metlakatla, a 900-member aboriginal community based just a few kilometers from the proposed terminal site, reached a 40-year benefit deal with Petronas late last year. The Kitselas First Nation have also signed an agreement.

Petronas has said it hopes to make a final investment decision on the project by the end of June.

($1 = 1.2090 Canadian dollars)


Gulf States Want Sales Tax after Oil Slump

By Reuters 2015-05-10 17:01:09

Officials of the six-nation Gulf Cooperation Council agreed at the weekend to keep working toward the introduction of a value-added tax around the region, in a sign that low oil prices may be strengthening support for the idea.

A meeting in Doha of the GCC’s Financial and Economic Cooperation Committee adopted a draft agreement on VAT which will be endorsed by member governments, Kuwaiti state news agency KUNA quoted Kuwait’s Minister of Finance Anas al-Saleh as saying on Saturday.

Introducing VAT, also known as sales tax, would be a big economic reform for the wealthy Gulf oil exporting states, and politically sensitive because their populations have become used to lavish social welfare spending and near-zero taxation.

Because there is considerable travel within the GCC, officials believe VAT would have to be imposed simultaneously in all six nations to avoid smuggling of untaxed goods across borders that could cost governments billions of dollars.

GCC states have traditionally relied on oil and natural gas for 80 to 90 percent of their state revenues, leaving them acutely vulnerable to energy price swings; many economists have been urging GCC governments to introduce new taxes to diversify their revenue bases.

The GCC has been discussing the idea of introducing VAT for about a decade without acting on it. But cheap oil has opened up state budget deficits among most GCC governments in recent months, and the weekend’s Doha agreement may indicate they are now looking at the idea more seriously.

However, Saleh did not give any time frame for VAT to be introduced or specify the likely tax rate, which suggested that key details have still not been decided.

He said each GCC country would issue its own VAT law based on common principles of the Doha agreement.

The GCC officials also agreed to ask the International Monetary Fund, a vocal proponent of more taxes in the Gulf, to prepare studies of the effects of low oil prices on GCC member states, especially on their financial stability, domestic energy prices and tax policies, Saleh added.

He said ministers of justice were discussing the idea of establishing a joint GCC judicial body handling economic issues. He did not elaborate.


Tanker Loading at Libya’s Zueitina Port

By Reuters 2015-05-10 16:37:30

A tanker has docked at the eastern Libyan port of Zueitina port to lift 750,000 barrels of crude, an oil official said on Saturday.

The ship had begun loading from the port’s tanks, the official said, adding that crude flows from connected fields were still blocked by protests that started a week ago.

Unemployed local people have blocked pipelines to the port demanding that the state oil firm hire them, shutting down the Nafoura oilfield which had pumped between 30-35,000 barrels a day to Zueitina.

“The port is working normally but there are no new crude flows,” said the oil official. “They are now emptying the port’s tanks.”

Zueitina was one of the few Libyan ports still exporting oil after the largest, Ras Lanuf and Es Sider, closed in December because of clashes between armed groups allied to Libya’s two governments.

The closures have knocked down Libya’s oil production to 380-400,000 bpd, an industry source told Reuters on Friday. The OPEC member had pumped up to 1.6 million bpd in 2010 before an uprising toppled Muammar Gaddafi, sending the country and industry into turmoil.

Last month the western El Feel oilfield, run by state firm NOC and Italy’s ENI, shut down due to a strike by security guards demanding state jobs. The neighboring El Sharara field had closed in November due to a pipeline blockage.

The loss of oil revenue has triggered a public finance crisis, forcing the central bank to use up a quarter of its foreign currency reserves in 2014, according to official data.

Libya is caught in a struggle between two governments, one based in the east and a rival administration controlling Tripoli, after former rebels who helped oust Muammar Gaddafi in 2011 have fallen out along political, regional and tribal lines.


Philippines Typhoon Triggers Evacuations

By Reuters 2015-05-10 16:27:20

Typhoon Noul crashed ashore on the northeastern tip of the Philippines on Sunday, as officials warned of landslides and called on residents along the coast to evacuate to safer ground.

The category five storm packed winds of up to 185 kph (115 mph) near the center, with gusts of up to 220 kph. It made landfall in the rice-producing province of Cagayan about 400 km (250 miles) north of the capital, Manila, the weather bureau said.

Power was cut in Tuguegarao City, the capital of the province of around a million inhabitants. The typhoon is expected to move northwest at 17 kph and head towards southern Japan on Tuesday.

“We strongly advise pre-emptive evacuation while we still have time, and we expect there will be a confluence of events – a high tide, heavy rainfall in the mountains, the possibility of a storm surge and strong winds,” Alexander Pama, head of the national disaster agency, told a news briefing before the typhoon hit land.

The typhoon was expected to trigger landslides and flash floods in parts of the Cagayan Valley, the weather bureau said, adding that heavy to intense rainfall was likely within the typhoon’s 100 km diameter.

More than 5,000 passengers and about 100 vessels were stranded in ports on Saturday, mostly along the eastern seaboard. Airline Cebu Pacific cancelled at least six domestic flights to the northern Philippines.

Officials in northern Philippine provinces have alerted rescue units and positioned relief goods. The government readied trucks to ferry people away from low-lying and flood-prone areas.

An average of 20 typhoons cross the Philippines each year, with the storms becoming fiercer in recent years. More than 8,000 people died or went missing and about a million were made homeless by Haiyan, another category 5 typhoon that struck the central Philippines in 2013, bringing 5-metre high storm surges.


Iran to Send Cargo Ship to Yemen

By Reuters 2015-05-10 16:18:32

An Iranian cargo ship will set sail for the rebel-held Yemeni port of Hodeida on Sunday evening, Iran’s Tasnim news agency said, in a move likely to fan further tensions with Saudi-led forces blockading the country.

Yemen’s Iran-allied Houthi militia earlier on Sunday accepted a five-day ceasefire proposed by Saudi Arabia after more than a month of bombing that has caused severe shortages of food, medicine and fuel.

Tasnim reported that the cargo ship would carry 2,500 tons of humanitarian aid including food staples and medicine.

Saudi Arabia and its Arab allies have accused Iran of seeking to smuggle weapons and ammunition to the Houthis and have imposed a sea and air blockade on Yemen.

Coalition jets destroyed the runway of Sanaa airport last month to prevent an Iranian plane from landing. Tehran said it was carrying aid.

Yemen imports more than 90 percent of its food and aid agencies have warned of a humanitarian catastrophe.

Iran denies funding and arming the Houthis, but Sunni Muslim Gulf countries believe the Islamic Republic is using the Shi’ite Muslim group to gain a foothold in the Arabian Peninsula.

Supported by the United States, the Saudi-led coalition began air strikes against the Houthis and army units loyal to ex-president Ali Abdullah Saleh on March 26 with the aim of restoring the government of President Abd-Rabbu Mansour Hadi.