Editor's Letter

Oil&Gas Eurasia Looks Back on Its First Decade in the Russian Market

Pat Davis Szymczak

   Welcome to Oil&Gas Eurasia’s 10th Anniversary Issue! As Gold Sponsors of the 2010 Russian Petroleum & Gas Congress held alongside this year...

Platts Report: China's Oil Demand in June Hits New High, Up 10 percent from Year Ago

China's apparent* oil demand in June hits yet another record high, at 36.74 million metric tons (mt) or about 8.98 million barrels per day (b/d), according to the just released Platts analysis of official data from the People’s Republic of China. The June demand figure is up 10 percent from a year ago and it eclipses the previous high of 36.48 million mt established in May 2010 by 0.7 percent.

Kazakhstan Ready To Support Nabucco With Gas

Kazakhstan President Nursultan Nazarbayev knows a thing or two about changing things to his country's advantage. The latest evidence of this came last Sunday when he told German Chancellor Angela Merkel Kazakhstan was ready to supply its gas to Germany through the Nabbucco pipeline. Experts believe Kazakhstan could redirect some of its Caspian gas away from Russia to other destinations, including those not in the West.

Top Drive Launch Boosts Bentec Brand, Gives New Options to OEM Market in Drilling

   Rig builder Bentec is now in the top drive business. The results of field tests started this June in Austria of Bentec’s new top drive are expected to be released in late summer. But already, Bentec has sold six of its new systems to be delivered by year end – four for use in Russia and two for use in the Middle East.
The new top drive opens a new revenue stream for Bentec in the global OEM (Original Equipment Manufacturer) market. The new offering also helps Bentec manage its brand.

Caterpillar Stakes Its Claim in Power Sales Through a Coordinated Dealer Network

   The man who founded Caterpillar first came to Russia in 1913 to sell tractors. The company's presence grew during Soviet times. And now, in the post-Soviet period, the company is taking a commanding position in Russia’s biggest revenue-producing industry – oil and gas. It’s approach has been two-tiered: building a dealer network to take care of local sales and service at a tactical level, while Caterpillar’s own management focus on strategic client relationships and coordination of dealer activities.

Heat Trace Brings to Market the Third Generation of Industrial Heating Cables

   Siberia is very cold, and it’s the science of heat tracing that keeps the oil and gas flowing along pipelines and through collector systems and processing plants.
Since the 1970s, the heat tracing industry has focused its R&D on developing heating-cable systems that can handle ever higher temperatures. But safety was always an issue. In an emergency, even the best high temperature cable could not entirely shut down the electrical current passing through it. Always, some connectivity remained that could cause fire or explosion.

“The Way We Were” Oil&Gas Eurasia Looks Back at a Decade of Change in Russian Oil&Gas

   The last 10 years have been witness to nothing short of a revolution in the post-Soviet oil and gas industry. When the millennium dawned in 2000, private Russian companies held the best reserves. Today, those reserves are the property of the state. Once an oligarch, Mikhail Khordokovsky languishes in exile in an East Siberian prison. Gazprom changed and Russia is today a Klondike for oilfield service companies and equipment sellers from all over the world.

Short on R&D, Russia’s Offshore “Needs Its Skolkovo*” PGS Russia Chief Alexander Dementyev

   Russian President Dmitry Medvedev’s official visit to Norway in April marked a certain watershed in ties between the two countries. Medvedev’s trip to Oslo was capped by the signing of a historic agreement setting the principles of the Barents Sea division, which is sure to boost Russian-Norwegian cooperation in the petroleum sector.

Russia Weighs Its Options as Shale Gas Wave Hits Europe Part 2

   The rapid growth in U.S. shale gas production is perplexing global gas producers. Gazprom has already postponed the launch of the Shtokman gas condensate field development in the Barents Sea with its 3.9 trillion cubic meters of gas – the Russian monopoly’s first LNG project (excluding Sakhalin-2, where the company did not have to build the infrastructure).

Putin Gives Total CEO Approval on Yamal LNG Project

Total is looking to win a major stake in the Yamal liquefied natural gas project, chief executive Christophe de Margerie said Friday, according to the Moscow Times.
The daily reports that de Margerie said the French oil and gas giant seeks a 20 to 25 percent stake in developing the Yamal field.
The news comes as de Margerie met Russian Prime Minister Vladimir Putin in Paris June 11 to propose Qatar join the LNG project which also includes building and LNG plant and loading facilities in the Arctic.

Rosneft and Chevron Agree Key Principles on Joint Black Sea Exploration

Rosneft and Chevron Corporation inked mutual agreements in Novo-Ogarevo outlining key principles of future joint exploration activity planned for Rosneft’s Val Shatskovo off-shore license in the Black Sea, Rosneft reported today in a news release.
The agreements were signed by Rosneft President Sergey Bogdanchikov and Chevron CEO John Watson. The signing ceremony was attended by Prime-Minister Putin and Rosneft Chairman and First Deputy Prime Minister Igor Sechin.

Neftegaz Exhibit 2010 Opens, Breaks Exhibitor Attendance Records

The 13th annual Neftegaz oil and gas industry exhibition kicked off today, June 21, with over 1,000 exhibitors in attendance representing 36 countries. The event officially opened at 12:00 at the Expocenter in downtown Moscow. Among those welcoming guests was Yuriy Lipatov, the chair of the Russian Duma energy committee member. Lipatov noted Russia must improve the level of its design engineering in order to avoid huge catastrophes such as the huge spill in the Gulf of Mexico.

CERA's Gustafson: Russian Response to Tight Gas "Shale Gale" is Logical And United

Speaking at the Russian Petroleum and Gas Congress expert discussion on "Unconventional Gas Resources in Russia and the World: Technologies and Prospects", IHS CERA Senior Director Thane Gustafson noted that the swift development of shale gas in North America has forced Russia to respond as LNG shipments are re-routed from the US to Europe. This massive arrival of gas in Europe resulted in a drastic drop in spot gas prices which in turn has encouraged European consumers to ask Gazprom to ease the conditions of its long-term gas supply contracts.

Oil&Gas Eurasia Celebrates 10-Year Anniversary

Oil&Gas Eurasia marked its 10 year Jubilee in Russia at Neftegaz 2010 and RPGC in Moscow.
OGE's 12 person distribution team, outfitted in red tee shirts and baseball caps passed out 8,000 copies of our June issue during the weeklong event. As gold sponsors of RPGC (the Russian Petroleum & Gas Conference) Oil&Gas Eurasia sponsored the gala dinner at Lotte Plaza in downtown Moscow.

Gazprom Neft Plans to Double Production To 100 Million Tons By 2020

Gazprom Neft produced 50.2 million tons of oil in 2009, Gazprom Neft Management Chair Aleksandr Dyukov said during the company's annual shareholders' meeting. "This means we have cleared the psychological 50 percent boundary", Dyukov added.

Japanese Companies to Develop Uzbek Oil Shale Fields

The Uzbek government has attracted Japan Oil, Gas & Metals National Corp. (JOGMEC), JGS and Technopian Corporationto jointly explore and develop oil shale deposits in Uzbekistan, according to the Uzbek State Committee for Geology and Mineral Resources (SCGMR). In June, Uzbekistan's Foreign Economic Relations, Investments and Trade Ministry, SCGMR, Uzbekneftegaz and JOGMEC signed an agreement to develop oil shale deposits in Uzbekistan.

Ten Millionth Ton of Crude Produced At East Siberian Vankor Field

The 10 millionth ton of oil was produced today at the Vankor oil field. The field was opened for development in August 2009. In the first half of 2010, over 6 million tons of crude has been produced.
Currently, 102 wells in 13 clusters on the field are producing a total of 36,100 tons of oil a day. Large infrastructure works are being built including a diesel fuel workshop, a gas preparation unit, and a water sluice as well as oil pump stations.

Belarus Diversifies Crude Deliveries From Venezuela

Belarus and Ukraine have inked an intergovernmental agreement to develop cooperation in shipping crude across Ukraine to Belarus, Telegraf.by reports. The document was signed as a Belarussian delegation headed by Deputy Prime Minister Vladimir Semashko to Ukraine, the Belarussian Foreign Ministry reported.
During the visit Semashko met First Deputy Prime Minister of Ukraine Andrey Klyuyev with whom he discussed bilateral trade and economic cooperation, according to BelTA.

Russian Oil Tankers Move Through North East Passage

The two Murmansk registered oil tankers Varzuga and Indiga are right now on their way through the partly ice-covered Northern Sea Route on their way to Chukotka in Russia’s Far East. The Arctic shipping season 2010 is closely followed by the world’s shipping interests as global warming makes the sea ice retreat in record speed. By sailing the Northern Sea route, the ship-owners save both time and fuel-costs as the distance from Europe to Asia via the north is much shorter than traditionally routes through the Suez- Panama-, or around Africa to Asia.

SKOLKOVO And TNK-BP Launch Major Projects Academy In Russia

Moscow’s SKOLKOVO School of Management and TNK-BP have completed the first phase of a new modular education program aimed at creating a centre of excellence on project management within the company – the TNK-BP Major Projects Academy. The purpose of the Academy is to bring together leaders from different company departments for a systematic exchange of experiences, knowledge and specific project solutions in order to develop a common TNK-BP approach to project management using the most efficient practices and tools.