WASHINGTON, Feb. 24 (UPI) -- Since Sept. 11, the U.S. Department of Homeland Security has made the U.S. pipeline industry a top priority. In addition to assuming the responsibility of the country's 200,000 miles of oil pipelines, the Department of Homeland Security simultaneously faces the challenge of protecting those pipelines from terrorist attack and also keeping the public apprised about pipeline locations. While the war on terror has increased global tensions, the pipeline industry is looking to undertake stringent measures to protect the country's critical energy infrastructure by increasing pipeline surveillance and conducting thorough background investigations on employees working with the country's pipelines. Pipeline companies and state and local authorities now share security information and have developed emergency plans. The pipeline industry has also established a program to inform the public about pipeline security to include pipeline rights of way, pipeline safety and pipeline risk so the general public will avoid disrupting and damaging the system. Pipeline routes are indicated by above-ground signs in yellow, black or red so that anyone planning to dig in the area should contact the local "One Call" center to prevent pipeline damage. Further information about digging near a pipeline may be found at the following sites: Dig Safely, digsafely.com and Common Ground Alliance, www.commongroundalliance.com.
India intends to purchase 15 percent of the Yuganskneftegaz shares. Indian Minister of Petroleum Industry and Gas Mani Shankar Aiyar and Russian Minister of Industry and Energy (MIE) Viktor Khristenko met on Feb. 21 to discuss the purchase; Aiyar also expects to meet with Gazprom and Rosneft executives. Aiyar announced earlier that India intends to continue negotiations with Russia for purchasing Yuganskneftegaz shares. Russian Union of Oil and Gas Industrialists President Gennady Shmal stated: "Foreigners may be admitted to such strategically important assets but control must be exercised by Russian companies and residents operating in Russia." Russian economic adviser, Andrei Illarionov, stressed that "under the liberal-market economic development model conditions, Russia has every ground to allow foreign companies to develop its oil and gas resources. Under such (economic development) model, mineral resources may belong to private owners and be sold at auctions openly and in accordance with plans announced in advance."
Lukoil Vice President Leonid Fedun announced that the company is currently negotiating to purchase a 50 percent stake in the German Ruhr Oel GMBH. Accounting for some 20 percent of Germany's entire fuel market, Ruhr Oel refines 50 million tons of crude oil annually. British Petroleum and Petroleos de Venezuela (PdVSA) each currently own a 50 percent stake in Ruhr Oel. Despite high oil prices, PdVSA sources have noted that the company has tried to repeatedly sell its shares in Ruhr Oel because of the company's difficulty in making a profit in supplying daily crude oil to German refineries. PdVSA was looking to sell the company's Ruhr Oel shares to Russia's Alpha Group in 2003 for some $600-$900 million.
Daewoo Shipbuilding & Marine Engineering Co. announced on Feb. 23 that the company has won a $978 million order to construct an oil facility offshore Nigeria expected to come on line by May 2008. According to Daewoo officials, this project is the world's largest order to construct a floating oil production, storage and offshore loading (FPSO) facility. Star Deep Water Petroleum subsidiary ChevronTexaco requested the order. Having a storage capacity of 2.16 million barrels of crude oil, the facility is almost 1,050 feet long, 194 feet wide and 105 feet deep. A Daewoo official said: "The winning of the order proves our ability to build super offshore plants."
The Korea National Oil Corp. (KNOC) announced on Feb. 23 that the company intends to begin exploring the western Kamchatka region in far eastern Russia within the next several months. KNOC official stated that the company signed an oil exploration interim finance agreement with Russia's Rosneft in Moscow on Feb. 22 to explore an area of 23,166 square miles. Under the agreement, the two companies will form a joint venture by the end of 2005 and will conduct drilling projects at various sites before 2008. KNOC and Rosneft had initially signed a memorandum of understanding in September 2003.
According to Romania's Ministry of Economy and Trade State Secretary Eugen Tapu-Nazare, the country's portion of the Constanta-Trieste oil pipeline will cost approximately $2.5 billion to construct. The other countries involved in the project -- Serbia, Croatia, Slovenia and Italy -- intend to invest the remaining $2.6 billion for the pipeline with a capacity of 120 million tons annually. Romania conducted the first feasibility, which examined the technical, financial, legal, transport capacity, environmental and commercial aspects of such an undertaking.
Closing oil prices, Feb. 24, 3 p.m. London
Brent crude oil: $49.45
West Texas intermediate crude oil: $51.86