A sharp decline in shallow drilling in the Gulf of Mexico and declining rig dayrates led to a 3.1% drop in Global Marine’s worldwide SCORE report, or Summary of Current Offshore Rig Economics, for October 2001 from the September SCORE. The SCORE for the Gulf of Mexico plummeted 16% and is down 13.7% from last October and 33.2% from the five-year average
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ExxonMobil Earnings Down 23%; Gas Volumes Off 16%
Rapidly declining gas and oil prices, a weakening economy and higher operating costs pressured ExxonMobil Corp. earnings down 23% or $970 million, excluding merger effects, to $3.3 billion ($0.48 per share). Earnings per share declined by 20%. Domestic natural gas sales were off more than 16% from the same period last year.
Rush Still on to Build LNG Terminals in Bahamas
Despite falling gas prices, declining demand and increasing production, the rush is still on to bring more liquefied natural gas (LNG) to the United States. Two El Paso Corp. subsidiaries are conducting separate open seasons to determine non-binding customer interest in transportation capacity on pipelines that will transport natural gas from El Paso Global LNG’s planned LNG terminal on Grand Bahama Island to Florida.
Only All-American Utility Stocks Prosper
Making steady progress since Monday against a rising tide of declining energy stock prices, Atlanta, GA-based Southern Co., Akron, OH-based FirstEnergy and New Jersey-based GPU Inc. again were on the plus side Wednesday. It wasn’t hard to figure, as U.S. aircraft carriers steamed toward the Caribbean and the Middle East, with fighter planes expected to follow soon. The three utilities own no foreign facilities.
MMS Gets $190M in Bids for 320 Western Gulf Tracts
Despite declining gas prices, drilling economics and drilling activity in the Gulf of Mexico, the Interior Department’s Minerals Management Service reported western Gulf lease sale 180 last week was the fourth largest in the last 10 years in terms of the number of tracts receiving bids.
MMS: Lease Sale 180 is Fourth Largest in 10 Years
Despite declining gas prices, drilling economics and drilling activity in the Gulf of Mexico, the Interior Department’s Minerals Management Service said western Gulf lease sale 180 is the fourth largest in the last 10 years in terms of the number of tracts receiving bids. The lease sale, which will take place on Wednesday, received 386 bids on 320 tracts from 44 producers. The last western Gulf lease sale last August received 226 bids on 266 tracts, totaling $167.4 million from 60 producers, said MMS spokeswoman Caryl Fagot.
AGA Examines Strong Gas Reserve Growth Last Year
Gas reserves grew substantially in 2000 with a little help from declining production and a big turnaround in drilling, according to a new report by the American Gas Association. The AGA report shows that based on the behavior of 30 large reserve holders examined, total domestic gas reserve additions are expected to be 24 Tcf or greater for 2000. Because only 19.2 Tcf is estimated to have been produced, reserves for 2000 are expected to have grown from 164.7 Tcf to more than 170 Tcf — the highest level of reserves since 1987, AGA said. Additions to gas reserves exceeded domestic production by at least 26% in 2000.
El Paso Merchant Declines ROFR Opportunity
El Paso Merchant Energy, declining to match bids for aboutone-third of the capacity on its affiliate El Paso Natural GasPipeline into California, “passed up a short-term profit” (and morecontroversy) to focus on “building our long-term relationship withour California customers,” according to spokesman Mel Scott.
Transportation Notes
Citing high storage inventories and declining injectioncapabilities related to high field pressures, CIG will implement anOFO taking effect today until further notice for all firmtransportation and storage customers. To relieve a “criticaloperational situation,” CIG is limiting No-Notice Transportation(NNT-1 and NNT-2) customers to an injection maximum of 1/250th oftheir contractual Maximum Available Capacity. Shippers with storageinventory exceeding MAC should initiate withdrawals to get withintheir allowable limits, the pipeline said. Although interruptiblestorage customers (IS-1) were not specifically part of the OFO,they were notified that injections are not available. In additionto the storage situation, CIG said, excessive positive imbalanceson FT contracts are threatening system integrity.
Gulf of Mexico Seeing Drilling Improvement
Fourteen consecutive months of declining drilling rigutilization came to an end in July, according to Global Marine’smost recent SCORE report, or Summary of Current Offshore RigEconomics. And the Gulf of Mexico appears to be leading theturnaround.