UPI Energy Watch

India's ONGC may cut Venezuelan output

India's Oil and Natural Gas Corp. was asked by the Venezuelan government to cut output at its joint venture project, the San Cristobal oilfield.

Venezuela, a member of the Organization of Petroleum Exporting Countries, must cut its oil production, domain-B reported. OPEC decided recently to cut its total production by 2.2 million barrels per day.

The Venezuelan government is currently calculating its share of the 2.2 million barrels and then will tell ONGC how much the San Cristobal project must cut back.

At the same time, ONGC is getting closer to acquiring U.K.-based Imperial Energy. Nearly 90 percent of Imperial Energy stakeholders have accepted ONGC Videsh's bid.

The offer, of $25 per share, however, could be at risk if ONGC loses money from its joint venture in Venezuela.

In addition, the $1.9 billion price tag is high as crude oil prices continue to fall below $40 per barrel.

ONGC cannot take its offer off the table now, but the deal will be canceled if it cannot get approval from 90 percent of the stakeholders.

"Our position has not changed. We are well aware of our obligation to capital markets and shareholders," ONGC said.

Iraq on track to open round two

Iraqi Oil Minister Hussain al-Shahristani said Iraq is ready to offer 10 more oil fields to be developed by international companies following a successful first round in which six oil and gas fields were licensed to foreign companies, Chinese news agency Xinhua reported.

Iraq's Oil Ministry will open its second licensing round Wednesday. All 10 fields that will be auctioned will not be named until bidding opens tomorrow, but al-Shahristani said they will include the southern fields of Majnoon and West Qurna Phase 2.

The foreign oil companies that will be allowed to bid on the 10 fields have already been prequalified by the ministry.

Only 35 companies and joint ventures out of 120 applicants were qualified to bid on the contracts, the ministry said.

Iraq's oil reserves are reportedly the third largest in the world, but billions of dollars of investment are needed to repair old and damaged infrastructure and increase oil and gas output after 13 years of sanctions and war, Xinhua reported.

U.S. updates its oil and gas reporting

The U.S. Securities and Exchange Commission announced new reporting requirements for oil and gas companies that officials said will aid investors in their evaluations, RTTNews reported.

"These updates to the SEC rules will help ensure more meaningful and comprehensive disclosure of information that, even though it does not appear on a company's balance sheet, is of significance to investors in making informed investment decisions," SEC Chairman Christopher Cox said.

The last changes were made 25 years ago and new technology made it important to update the rules, Cox said.

Cox said the new regulations take into account technological advances and allow companies to disclose their probable and possible reserves to investors.

New rules will also require companies to report the independence and qualifications of their auditors.

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Closing oil prices, Dec. 30, 3 p.m., London

Brent Crude oil: $38.08

West Texas Intermediate crude oil: $38.91

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(e-mail: energy@upi.com)