Cobalt Names COO

- Cobalt Names COO

Wednesday, September 07, 2011
Cobalt International Energy Inc.

Cobalt announced that Van P. Whitfield has been promoted to the new position of Chief Operating Officer. Mr. Whitfield previously held the position of Executive Vice President, Operations and Development.

Joseph H. Bryant, Cobalt Chairman and Chief Executive Officer said, "Van has been an indispensable member of Cobalt's management team from the earliest days of the company, and I believe this new role will take advantage of the full range of his management talent and experience. Van's many years of senior management experience in worldwide operations will serve him well in his expanded role. As Cobalt executes its deepwater exploration program in two of the world's highest potential basins, the Board of Directors and I are very pleased that Van has accepted this position, and are confident that he will excel in this new role."

Mr. Whitfield joined Cobalt in May 2006. Mr. Whitfield has 37 years of experience leading oil and gas production operations and marketing activities in North America, the United Kingdom and Europe, Africa, the Middle East and Asia. Prior to joining Cobalt, Mr. Whitfield served in executive positions at CDX Gas LLC, BP Exploration (Angola) Limited, and was seconded to ExxonMobil Saudi Arabia (Southern Ghawar) Ltd in the position of Vice President, Power and Water. Mr. Whitfield has also held the positions of Senior Vice President of BP Global Power, President and General Manager of Amoco Netherlands BV and Production Manager of Amoco (U.K.) Exploration Company. In addition, he has held numerous operational and technical leadership positions in various Amoco Production Company locations throughout the globe. Mr. Whitfield has a Bachelor of Science Degree—Petroleum Engineering from Louisiana State University and is a graduate of the Executive Program at Stanford University.

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RWE Dea's UK Fields Breagh and Clipper South on Track

- RWE Dea's UK Fields Breagh and Clipper South on Track

Wednesday, August 31, 2011
RWE Dea AG

RWE Dea UK's field developments Breagh and Clipper South are both progressing on schedule. On a visit to Heerema's fabrication yard in Zwijndrecht (Netherlands) Wednesday, RWE Dea CEO Thomas Rappuhn emphasized the high significance of both projects: "The proven reserves play an important role to significantly increase RWE Dea's gas production in the North Sea."

"Breagh for example is one of the largest natural gas discoveries in the Southern North Sea and our target is to bring field developments on stream quickly," added RWE Dea UK Managing Director René Pawel.

Gross investments are GBP 430 million (Breagh, Phase 1) and GBP 240 million (Clipper South). RWE Dea holds 70% interest in the Breagh gas field as operator (Sterling Resources UK 30%). With a stake of 50% in Clipper South, RWE Dea is operator with Fairfield Energy and Bayerngas each holding a 25% stake.

Pawel said, "We remain on course to achieve production from the Breagh field less than three years after we acquired operatorship of the Breagh license and expect first gas in the second half of 2012 and from Clipper South in the first half of 2012."

Both platforms are being constructed by the Heerema Fabrication Group. The Breagh platform consists of a jacket approximately 85 meters tall with a total weight of some 4,000 tonnes and topside of approximately 1,400 tonnes. The topsides have been moved out of the shed and are ready for sail-away from Heerema's fabrication yard mid September. The jacket is on schedule for load out early September. The Clipper South platform with topsides weighing 1,900 tonnes has accommodation for 40 persons and sailed away for offshore on Thursday 25th and was successfully installed on Saturday, August 27 with standalone overnight manning on the day of installation – testimony to the very high level of completion on departure from the yard. The Clipper South platform is in a water depth of approximately 23 meters, and a 12" pipeline will connect to the ConocoPhilips operated LOGGS complex for onwards transportation of gas to the Theddlethorpe terminal in the UK.

The Breagh field is located in UKCS blocks 42/12a and 42/13a of the southern North Sea in 62 meters water depth, approximately 100 kilometers east of Teesside. Around 100 kilometers of 20" pipeline have been successfully installed offshore. The platform will be installed by Heerema Marine Contractors.

The field is being developed in two phases. Phase 1 entails gas to be exported via the 20" pipeline from the Breagh Alpha platform to Coatham Sands, Redcar on the UK mainland, and a 10 kilometers onshore pipeline for processing at the Teesside Gas Processing Plant (TGPP) at Seal Sands. The TGPP site is owned by Teesside Gas & Liquids Processing, and after processing at the TGPP, the gas will enter the UK National Transmission System. Phase 2, planned to receive project sanction in late 2011, is expected to include additional wells in the east of the field likely to be drilled from a further Breagh platform tied back to Alpha.

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Exxon Mobil and Rosneft Team Up

- Exxon Mobil and Rosneft Team Up



Aug 30, 2011

Exxon Mobil (NYSE:XOM) and Rosneft teamed up with U.S. company ExxonMobil to develop Russian Arctic oil fields, that had eluded BP earlier this year.

Rustam Kazharov, a spokesman for Rosneft told the Associates Press the deal was signed Tuesday in the presence of Russia's Prime Minister Vladimar Putin.

Rosneft struck a deal with BP in January to jointly increase Russia's Arctic but the deal fell through after BP's Russian shareholders managed to block the deal.

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Rosneft and ExxonMobil Plan $3.2B Program in Black, Kara Seas

- Rosneft and ExxonMobil Plan $3.2B Program in Black, Kara Seas

Tuesday, August 30, 2011
ExxonMobil Corp.

Rosneft and ExxonMobil have executed a Strategic Cooperation Agreement under which the companies plan to undertake joint exploration and development of hydrocarbon resources in Russia, the United States and other countries throughout the world, and commence technology and expertise sharing activities.

The agreement, signed by Rosneft President Eduard Khudainatov and ExxonMobil Development Company President Neil Duffin in the presence of Russian Prime Minister Vladimir Putin, includes approximately US $3.2 billion to be spent funding exploration of East Prinovozemelskiy Blocks 1, 2 and 3 in the Kara Sea and the Tuapse License Block in the Black Sea, which are among the most promising and least explored offshore areas globally, with high potential for liquids and gas.

In the course of these projects, the companies will use global best practices to develop state-of-the-art safety and environmental protection systems.

The agreement also provides Rosneft with an opportunity to gain equity interest in a number of ExxonMobil's exploration opportunities in North America, including deep-water Gulf of Mexico and tight oil fields in Texas (USA), as well as additional opportunities in other countries. The companies have also agreed to conduct a joint study of developing tight oil resources in Western Siberia.

The companies will create an Arctic Research and Design Center for Offshore Developments in St. Petersburg, which will be staffed by Rosneft and ExxonMobil employees. The center will use proprietary ExxonMobil and Rosneft technology and will develop new technology to support the joint Arctic projects, including drilling, production and ice-class drilling platforms, as well as other Rosneft projects.

"We have a clear vision for Rosneft's strategic direction — building world-class expertise in offshore business and enhancing oil recovery," said Rosneft president Eduard Khudainatov, following the signing ceremony. "The partnership between Rosneft with its unique resource base, and the largest and one of the most highly capitalized companies in the world reflects our commitment to increasing capitalization of our business through application of best-in-class technology, innovative approach to business management, and enhancement of our staff potential. This venture comes as a result of many years of cooperation with ExxonMobil and brings Rosneft into large scale world-class projects, turning the company into a global energy leader."

ExxonMobil Development Company President Neil Duffin said: "Today's agreement with Rosneft builds on our 15-year successful relationship in the Sakhalin-1 project. Our technology, innovation and project execution capabilities will complement Rosneft's strengths and experience, especially in the area of understanding the future of Russian shelf development."

Rex Tillerson, chairman and chief executive officer of Exxon Mobil Corporation, who attended the ceremony, said ExxonMobil will benefit Russian energy development by working closely with Rosneft.

"This large-scale partnership represents a significant strategic step by both companies," said Tillerson. "This agreement takes our relationship to a new level and will create substantial value for both companies."

The agreement provides for constructive dialogue with the Russian Federation government concerning creation of a fiscal regime based on global best practices.

Additionally Rosneft and ExxonMobil will implement a program of staff exchanges of technical and management employees which will help strengthen the relationships between the companies and provide valuable career development opportunities for personnel of both companies.

The East Prinovozemelskiy License Blocks have a total area of 126,000 square kilometers (30 million acres) in water depths ranging between 50 and 150 meters (165 feet and 500 feet). Tuapse Block in the Black Sea has the total area of 11,200 square kilometers (2.8 million acres) and water depths ranging from 1,000 to 2,000 meters (3,300 feet and 6,500 feet). Rosneft equity interest in both joint ventures will be 66.7 percent, while ExxonMobil will hold 33.3 percent.

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Tullow Touts Record Results in 1H11

- Tullow Touts Record Results in 1H11

Wednesday, August 24, 2011
Tullow Oil plc

Tullow announced its half-yearly results for the six months ended 30 June 2011.

2011 Half-yearly results summary

• Record first half revenue and profit
• Interim dividend doubled
• Exploration success continues and developments being progressed

Tullow had a very strong first half. Record results were driven by increased production from the Jubilee field in Ghana and higher commodity prices. Exploration and appraisal success continued and the Group strengthened its portfolio with farm-ins in East Africa and two strategic acquisitions. Further progress was made in Uganda and Tullow now expects completion of its farm-down to CNOOC and Total in September. In July the Group listed Tullow Oil plc shares on the Ghana Stock Exchange.

Key highlights

• Record sales revenue of over $1 billion driven by Jubilee Production; interim dividend doubled.
• 71% exploration and appraisal success year-to-date (17/24); Akasa-1 discovery announced today.
• Completion of farm-in to six blocks in Kenya and Ethiopia; first well to spud in Kenya in Q4 2011.
• Group production expected to average 82-84,000 bopd for 2011 and exceed 100,000 bopd by year-end.
• Jubilee production in Ghana is expected to increase to 105,000 bopd in October; plateau production of 120,000 bopd is now expected before year-end.
• MoU signed with the Government of Uganda; $2.9 billion Sale and Purchase Agreements signed for the farm-down to CNOOC and Total; completion now expected in September.
• Nuon E&P and EO Group acquisitions completed in June and July respectively.
• Secondary listing on the Ghana Stock Exchange completed in July following successful $72.3 million offer.

Commenting, Aidan Heavey, Chief Executive, said, "We have delivered a strong performance and achieved record results in the first half allowing us to double the dividend. We continue to make good progress with production plans in both Ghana and Uganda and while delays to the farm-down to CNOOC and Total have been frustrating, we now expect completion in September. With a strong balance sheet, growing production and a potentially transformational drilling campaign to come, we move into the second half of the year with real confidence."

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Sky Names Agron Xhavo as VP - Albania and Co-Head Geologist

- Sky Names Agron Xhavo as VP - Albania and Co-Head Geologist

Monday, July 18, 2011
Sky Petroleum Inc.

Sky Petroleum, Inc., an oil and gas company with activities in Albania and the United Arab Emirates, is pleased to announce the appointment of Agron Xhavo as Vice President – Albania and Co-Head Geologist, effective August 1, 2011.

Mr. Xhavo has over 28 years of petroleum geology experience, and is currently with the National Agency of Natural Resources (“AKBN”) as its Head of Procedures, Petroleum Directory. Prior to AKBN Mr. Xhavo held several positions including: Chief of Administration of Opportunity Albania; Executive Director of the Albanian Commercial Mediation and Arbitration Centre, and Executive Director at the National Petroleum Agency (predecessor to AKBN). Agron holds a Bachelor Degree in Petroleum Geology from the University of Tirana.

"We are very pleased to have Agron join Sky Petroleum Inc. He is as an experienced petroleum geologist with significant knowledge of all aspects of the Albanian oil and gas industry as well as specific understanding of Blocks 4, 5 and Dumre,” said Karim Jobanputra, Sky Petroleum’s chief executive officer.

About Sky Petroleum

Sky Petroleum (OTCBB:SKPI.ob - News) is an oil and gas exploration company. Sky Petroleum's primary focus is to seek opportunities where discoveries can be appraised rapidly, and developments can be advanced either by accessing existing infrastructure, or by applying the extensive experience of established joint-venture partners. In addition, the company also plans some higher risk, higher reward exploration prospects. For additional information please visit www.skypetroleum.com.

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A Close Bond Built on Friendship - And Oil

- A Close Bond Built on Friendship - And Oil

Thursday, July 14, 2011
The Washington Post
by Juan Forero;Adam Liebendorfer

Something wasn't quite right, Hugo Chavez recounted. And the Venezuelan president's mentor, 84-year-old Fidel Castro, noticed straight away.

"What's wrong with you?" Castro asked. The Cuban leader urged Chavez to stand up and looked him over with what the Venezuelan populist called Castro's "eagle eyes." "Where's the pain?"

Castro then "began to question me, like a father questions a son," Chavez said in his account of their meeting in Havana last month; he said he "confessed" his ailments as if he were Castro's patient.

At the Cuban revolutionary's insistence, Chavez then went under the scalpel to remove a malignant tumor. Later, Castro brought peanut butter he himself had made and gabbed with a recovering Chavez about world affairs. "Fidel is like a saint," Chavez told Cuban state television.

The outsize role that Castro has played in Chavez's ordeal with cancer has brought into sharp relief not only the personal, even paternal nature of their relationship, but also how vital Chavez's health is to Cuba's archaic communist system.

The links the two leaders have forged are based on heartfelt kinship, Chavez's government says. But the Cubans also have a lot riding on Chavez, who on Wednesday announced that he may undergo chemotherapy or radiation treatments. Since taking office in 1999, Chavez has shipped tens of billions of dollars in subsidized oil to the island.

"For the Cubans, this is not just an ideological friend and ally - he's a lifeline for the island economy," said Moises Naim, a Venezuelan who is a senior associate at the Carnegie Endowment for International Peace in Washington. "It's a matter of regime survival to ensure that a Cuban-friendly government is in power in Venezuela."

The friendship between the two men, who are separated by 28 years in age but share ideological affinities that include antipathy for the United States, has periodically been on display over Chavez's 12 years in power.

In 1999, before Castro's own health began to deteriorate, the two played baseball together before 55,000 spectators, appeared on Chavez's "Hello President" TV show and even sang folk songs (Chavez has the upper hand as a crooner).

In 2002, when Chavez was briefly ousted, Castro marshaled the support of Latin American presidents to help weaken the coup plotters who had seized power. More recently, as U.S. diplomatic cables made public by WikiLeaks show, Cuban intelligence officers operating in Venezuela have directly provided information to Chavez, unfettered by Venezuelan officers.

The bond is so tight, in fact, that Chavez's former common-law wife, Herma Marksmen, told American diplomats that Chavez confides in only two people, Castro and his elder brother, Adan.

Here in Venezuela, some of the trappings of Cuba's system are clearly evident: a powerful state propaganda apparatus; the state seizure of companies; the spread of fervent, pro-government neighborhood groups; and the use of the military slogan "Fatherland, socialism or death!"

But in spite of the revolutionary partnership, Venezuela clearly plays the more important role. With huge oil reserves, it replaced the benefactor to Cuba that was lost with the Soviet Union's breakup two decades ago. The 100,000 barrels of oil Cuba receives each day literally keep the lights on, particularly vital now as the Cuban government tinkers with economic liberalization measures to stay afloat.

"So if, let's just say the Venezuelan subsidy ended for whatever reason, Cuba would have a pretty short window - probably weeks, no more than a month or two - to make some very, very severe adjustments," said Brian Latell, a former CIA analyst and the author of "After Fidel: The Inside Story of Castro's Regime and Cuba's Next Leader."

So Chavez's ailment, made public in a carefully orchestrated speech from Havana, was quickly felt across Cuba, which had already seen Castro hand over the presidency to his brother, Raul, in 2006 after being sidelined by an intestinal illness.

Venezuelan oil allows Raul Castro to "buy time in the face of citizen discontent," Yoani Sanchez, the author of the Havana-based blog Generation Y, wrote this month, while the loss of Chavez "could hasten Raul's own downfall."

While some Cuba experts disagree with such a dour scenario, there is no doubt that Fidel Castro made sure Chavez got the best of care.

When the surgery was over, Castro brought treats such as lamb and tilapia. He was so pleased by Chavez's recovery, the Venezuelan president recalled, that Castro appeared "luminous, joyous, optimistic."

Chavez, who returned to Caracas last week, has yet to reveal what kind of cancer he has. But speaking on Cuban television, he was emphatic about Castro's role.

"If not for Fidel," Chavez said, "who knows where or in what labyrinth I would be in now."

Copyright washingtonpost.com

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S&P Lifts BP Outlook To Stable; Sees Less Downside Risk

- S&P Lifts BP Outlook To Stable; Sees Less Downside Risk

Wednesday, July 06, 2011
Dow Jones Newswires
by Melodie Warner

Standard & Poor's Ratings Services revised its credit outlook on BP to stable from negative, saying it sees less downside risk to the oil company's credit quality and little evidence of further erosion to its business standing.

The ratings company also affirmed BP's long-term corporate credit rating of A, which is five steps below the coveted AAA.

"The stable outlook reflects our view that BP is well positioned to meet potentially substantial additional fines and other payments related to the Gulf of Mexico disaster," the firm said. For its analysis, S&P assumes that all Gulf of Mexico-related payments will total less than $55 billion and will be spread over several years.

The ratings firm noted BP's first-quarter average realized oil price was 19.2% higher than the fourth quarter, and rose 31% from a year earlier. BP's refining margins also expanded in 2011, while its underlying downstream operating profit increased to $2.1 billion in the first quarter, from a quarterly average of $1.2 billion in 2010, despite a 6% decline in refining throughput, S&P said.

But, a sustained decline in oil prices below $70 a barrel alongside underlying operating cash flow of less than $25 billion could put downward pressure on the ratings, S&P said. Any upside rating potential is limited until there is more clarity on the penalties BP could face in the U.S. for the Gulf of Mexico oil spill.

Copyright (c) 2011 Dow Jones & Company, Inc.

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Americas Petrogas Increases Stake in Apache's Huacalera Block

- Americas Petrogas Increases Stake in Apache's Huacalera Block

Wednesday, June 15, 2011
Americas Petrogas Inc.

Americas Petrogas has completed the acquisition of Energicon S.A. as initially announced on June 3, 2011.

As a result of this acquisition, the Company now holds a 39% working interest in the Huacalera block, which contains Vaca Muerta shale source rock. The block is currently being drilled by the operator of the block, a subsidiary of Apache Corporation.

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OGX Briefs on Issuance of $2.563B Senior Unsecured Notes

- OGX Briefs on Issuance of $2.563B Senior Unsecured Notes

Friday, May 27, 2011
OGX S.A.

OGX in compliance with the Instruction of Comissão de Valores Mobiliários (CVM) announced the issuance of Senior Unsecured Notes totaling US $2.563 billion. The Notes issued on May 26, 2011 are due and payable by the Company on June 1, 2018 and will accrue interest at rate of 8.5% per annum, payable semi-annually, in June and December.

The Notes will be offered to qualified institutional buyers (QIBs), resident and domiciled in the United States, in accordance with the provisions of "Rule 144A" of the Securities Act of 1933, as amended, and in other countries except the United States and Brazil, based on "Regulation S".

When added to OGX’s current cash position of approximately US $2.5 billion (as of March 31, 2011), the net proceeds from the issuance Notes provide a liquidity of approximately US $5.063 billion, at a level which is sufficient for OGX to support the exploratory campaign and the production development of the discoveries made until the Company becomes self-funded by its own cash flow generation.

"This funding provides the necessary capital for the development of OGX's sizable discoveries that were made in an unprecedented time frame for the oil and gas sector. OGX now has the natural, financial, human and physical resources to implement its business plan," declared Paulo Mendonça, General Executive Officer and Exploration Officer for OGX.

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RBG Scores Safety Milestone at Trinidad and Tobago

- RBG Scores Safety Milestone at Trinidad and Tobago

Wednesday, May 25, 2011
RBG

RBG has recorded a significant safety achievement by completing more than 2,000,000 man-hours without a lost time incident across the company's Trinidad and Tobago operations.

The achievement marks another major milestone in the company's REACH safety program which, since its launch in December 2009, has played a major role in reducing Lost Time Incident Frequency (LTIF) by 38.5% globally. REACH aims to create a stronger, safer culture throughout RBG and in 2011 the initiative will expand to improve the company's full HSEQ remit.

In 2010, RBG's Trinidad and Tobago team was recognised for its contribution to Neal & Massy Wood Group's (NMWG's) achievement of 5,000,000 man-hours LTI free.

RBG's facilities in Point Lisas and Galeota employ approximately 430 personnel and offer the company's full range of innovative products and services including fabric maintenance, bolt torquing, fabrication and welding, scaffolding and habitat supply to the regional oil, gas and petrochemical industry.

RBG's Trinidad and Tobago country manager, Ricardo Mahadeo said, "I am very proud of our employees and we are delighted to have reached such a significant milestone. Reaching more than 2,000,000 hours without an LTI is testament to the commitment of our team to highlight and eliminate risk from our operation. It is a remarkable accomplishment and we will continue to work hard to maintain the high safety standards we have set.

"REACH has helped us achieve these excellent levels of safety by engraining good safety practice as a normal part of our daily working lives."

RBG's Group HSEQ director, Mike Mann, said, "The commitment demonstrated by our Trinidad and Tobago employees to achieve this goal is a tremendous example of the RBG safety culture we are striving for. This represents the best of our company in terms of leadership, engagement, communications, and commitment to achieving safety excellence."

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Treaty's Tx. Lease Acquisition Delayed

Treaty's Tx. Lease Acquisition Delayed

Friday, April 29, 2011
Treaty Energy Corp.

Treaty announced an update to its announced "letter of intent" of April 12, 2011 to acquire producing oil and gas leases in Shackelford County, Texas.

The closing on this acquisition has been delayed until June 7, 2011 because of issues that had to be corrected by the seller on the leases being purchased.

Stephen L. York, Vice President of Acquisitions and Operations for Treaty Energy, stated, "Although we are disappointed over the delay of this acquisition, we are very pleased that all the issues are being corrected and the new closing date is now set."

Commodity Corner: Crude Tumbles on S&P Debt Outlook

Commodity Corner: Crude Tumbles on S&P Debt Outlook

Monday, April 18, 2011

Rigzone Staff

by Saaniya Bangee

Front-month crude futures plummeted Monday after Standard & Poor (S&P) changed its outlook for U.S. debt from stable to negative. The shift in outlook has increased concerns of the U.S. economy's stability and cuts in government spending.

Oil prices fell by $2.54 Monday, settling at $107.12 a barrel on the New York Mercantile Exchange (NYMEX). Prices fluctuated between $106.54 and $109.44. The S&P move came on the possibility that policymakers may not reach an agreement on how to address long-term fiscal pressures.

Over the weekend, China's central bank announced it would increase bank reserve requirements. In its fourth attempt this year, China hopes to control inflation and curb energy demand. Following the U.S., China is the world's second largest energy consumer.

Additionally, Saudi Arabia's Oil Minister Ali al-Naimi said Sunday that the kingdom has reduced oil production by 800,000 barrels due to lack of demand. Crude output was 8.3 million barrels a day last month, compared to February's 9.1 million barrels a day. Naimi anticipates an increase in April production.

On Monday, the greenback rose against the euro and other currencies further pressuring prices. The euro fell on concerns that Greece will have to restructure its debt. A stronger dollar makes oil more expensive, less attractive to foreign buyers.

May natural gas prices fell for a second day Monday, settling nearly seven cents lower at $4.14 per thousand cubic feet. Analysts do not foresee any near-term pressure increasing prices due to near-average storage and below-average prices. The intraday range for natural gas was $4.087 to $4.27 per thousand cubic feet.

Likewise, gasoline futures fell 1.1 percent, peaking at $3.29 before bottoming out at $3.23. Gasoline priced ended Monday's trading session at $3.25 a gallon.

LNG Energy to Sell Ok. Acreage

LNG Energy to Sell Ok. Acreage

Wednesday, April 13, 2011
LNG Energy Ltd.

LNG Energy's subsidiary, BWB Exploration, has entered into an agreement to sell all of its working interest in approximately 2,800 net acres of oil and gas lease holdings in Carter County, Oklahoma to an undisclosed buyer for approximately US $5,180,000 in cash subject to final adjustments. The sale is expected to close on or before May 2, 2011.

"We continue to focus on our core areas in Poland and Papua New Guinea. This disposition follows our recent acquisition in Poland where we acquired about 180,000 net acres and now have exposure to a 1.1 million acre gross position in the Polish Baltic Basin," commented Dave Afseth, President & CEO of LNG.
Poland Operational Update

The second well being drilled, Lebork S-1 on the Slupsk Concession has been drilled to 3,517m, with 227m of open hole core already taken. It is anticipated that the drilling and logging will be completed in the next week. The core will be analyzed over the coming weeks. The majority of the analysis of the sidewall cores from the Wytowno S-1 well are expected to be received back from the subcontractor in May 2011. The 1st well on the Starogard concession is expected to be spudded in June 2011.

LNG is a Canadian exploration and development company focused on developing oil and gas reserves in Papua New Guinea, Poland and the US. LNG holds a 100% interest in approximately 5.5 million acres of prospective oil and gas properties in Papua New Guinea. LNG has a 50% net interest in approximately 360,000 gross acres of prospective shales in Poland together with Realm Energy (BVI). LNG also has a 20% net interest in approximately 734,000 gross acres of prospective shales in Poland together with BNK Petroleum Inc., Sorgenia E&P S.p.A., and Rohol-Aufsuchungs Aktiengesellschaft, and a 100% net interest in BWB Exploration, LLC ("BWB"), which holds approximately 2,800 acres of oil and gas leases in Carter County, Oklahoma and an estimated 28,757 acres of leases in the Black Warrior Basin of Mississippi and Alabama. LNG shares trade on the TSX Venture Exchange under the symbol "LNG".

BP Races to Save Deal With Rosneft

BP Races to Save Deal With Rosneft

Wednesday, April 13, 2011
The Wall Street Journal
by Guy Chazan & Gregory L. White

As a bruising fight between BP and some of Russia's most powerful oligarchs intensifies, BP is now weighing a previously unthinkable step to end the battle: possibly pulling out of its lucrative Russian joint venture with the oligarchs, TNK-BP.

BP is considering the move as part of its scramble to salvage a separate, proposed alliance with Russia's state oil company, Rosneft, before a crucial deadline for that deal -- which is opposed by its TNK-BP partners -- expires Thursday.

The U.K. oil company is considering a range of options to rescue the Rosneft partnership, some of which would have been inconceivable before the deal ran into trouble in February. One of them is to divest its 50% stake in TNK-BP, according to a person familiar with the matter.

Selling its half of a company that accounts for one quarter of BP's global oil-and-gas production and close to one-fifth of its reserves is seen as unlikely. But it is a sign of BP's desperation as the countdown begins to Thursday's deadline that it is even considering such an option.

In January, BP and Rosneft said they would swap shares in each other and jointly explore for oil and gas in the Russian Arctic, an area previously off limits to foreign oil companies, as part of a groundbreaking strategic partnership.

But BP's partners in TNK-BP, a consortium of Soviet-born billionaires collectively known as AAR, claimed the Rosneft deal violated their shareholder agreement, which stipulated that TNK-BP should be the main vehicle for both partners' investments in Russia. In February, AAR won a court injunction blocking the deal.

Last Friday a panel of independent arbitrators left the injunction in place until further notice but gave BP permission to seek to extend the April 14 deadline for the share swap.

The company is now pursuing a number of solutions to its dispute with AAR. Yet even now, it isn't clear which path it will take to extricate itself from the mess.

The options under consideration include allowing TNK-BP to participate in the Arctic venture, possibly through an equity interest, or compensating AAR financially to win its assent to the deal, according to the person familiar with the matter. However, some people close to BP think AAR is likely to demand a level of compensation that is far beyond what BP could accept.

Alternatively, Rosneft, BP or a third party could buy out AAR's stake in TNK-BP; or Rosneft or a third party could buy out BP's stake, the person familiar with the matter said.

Most of those options are considered extremely difficult to execute, according to analysts. AAR's 50% stake in TNK-BP is thought to be worth at least $25 billion, and it would be hard for BP or Rosneft to raise that kind of capital. The Russian government, opposed to foreign ownership of its strategic natural resources, may also balk at BP taking full ownership of one of Russia's largest oil producers.

On the other hand, BP would be loath to divest TNK-BP, whose rich dividend flow quickly exceeded BP's original investment, industry observers say.

In addition, it is unclear who would buy its stake. Most other Western oil companies are too risk-averse to make such a big bet on Russia.

"I think BP selling out of TNK-BP is the least likely option," said a Russian banker with knowledge of the firms. "It's a cash machine." He expects BP to offer AAR compensation, "a considerable payout, running into the billions of dollars."

There is little sign Rosneft will agree to an extension of the share-swap deadline, given its doubts about whether BP would be able to prevail in arbitration with AAR. "[Rosneft] seem to be frustrated," one person close to BP said. A spokesman for the Russian company said it had received no proposals from BP.

Meanwhile, people close to TNK-BP said the company was planning lawsuits against BP and its managers to claim compensation for damages the venture allegedly suffered from missing out on the Rosneft deal. People close to BP dismissed the leaks as a pressure tactic, apparently aimed at signaling BP won't be able to restore the status quo inside TNK-BP that existed before it announced its tie-up with Rosneft. Media reports about the planned lawsuits helped push BP shares lower Tuesday.