Oil tumbles below $44 a barrel
Edward McAllister
Thursday, December 04, 2008
NEW YORK — Oil fell more than 6 per cent on Thursday to its lowest level in nearly four years in response to further bleak economic data that could spell a deeper decline in global energy demand.
The number of U.S. workers on jobless rolls hit a 26-year high last month, the government said, while another report showed U.S. factory orders fell sharply for the third month in a row.
U.S. light crude dropped $2.86 (U.S.) to $43.93 a barrel by early afternoon EST after slipping as low as $43.77 – the lowest since January, 2005. London Brent crude fell $2.87 to $42.57.
Oil prices have dropped more than $100 a barrel from record highs over $147 in July, as the global credit crunch has eaten into demand in large consumer nations.
“Relentless negativity is pressuring the oil complex,” said Mike Fitzpatrick, vice-president at MF Global.
U.S. stocks fell on Thursday as the continued fall in oil prices pushed down shares in energy companies including Exxon Mobil.
A Commerce Department report showed that factory orders in October plunged 5.1 per cent, the biggest drop since July, 2000, and a Labour Department report showed that the number of U.S. workers on jobless benefits rolls was the highest since December, 1982.
AT&T Inc. and DuPont Co. on Thursday led the list of blue-chip U.S. companies laying off workers in the weeks before the Christmas holidays.
European central banks cut interest rates on Thursday to try to restore some vitality to their feeble economies, many of which are already in recession.
Sweden's central bank cut by a record 175 basis points, the European Central Bank cut by 75 points and the Bank of England cut by 100 points.
Oil producer group the Organization of the Petroleum Exporting Countries will consider another round of output curbs to try to defend prices when it next meets on Dec. 17 in Algeria.
“It is obvious that the market is oversupplied,” said Iran's OPEC governor Mohammad Ali Khatibi. “If you remove oversupply and produce exactly what the market needs, it would be good for everybody.”
Oil rose briefly on Wednesday when U.S. Energy Information Administration data revealed an unexpected fall in fuel inventories last week in the world's top energy consumer.
But U.S. refinery utilization fell 1.9 percentage points to 84.3 per cent of capacity against a predicted rise of 0.2 percentage point, pointing to weak demand.
© Copyright The Globe and Mail
Thursday, December 4, 2008
Oil tumbles below $44 a barrel
QEC News:La Visitation #1 Successfully Cased as Shale Gas Well
December 4, 2008-La Visitation #1 Successfully Cased as Shale Gas Well
00:15 EST Thursday, December 04, 2008
CALGARY, ALBERTA--(Marketwire - Dec. 4, 2008) -
NOT FOR DISTRIBUTION ON U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES
Questerre Energy Corporation ("Questerre" or the "Company") (TSX:QEC)(OSLO:QEC) announced today that the operator has completed drilling of the La Visitation #1 well in the St. Lawrence Lowlands, Quebec.
The well was drilled to target depth of 2770m and logged to evaluate the Utica and Lorraine shale/siltstone zones as well as the carbonates of the Trenton Black-River Group. Based on an analysis of the logs, the well has been cased for shale gas testing, which will be undertaken when equipment is available.
Michael Binnion, President and Chief Executive Officer of Questerre, commented, "Drilling results were encouraging as we encountered several naturally fractured intervals in the Lorraine and Utica and promising gas shows."
Drilling operations on the next well, St. David, are expected to commence later this month.
Questerre also reported on the status of re-completion operations on the Gentilly #1 vertical well. Following the stimulation and 800 mcf/d test from the Utica, two intervals in the shallower Lorraine horizon were also fracture stimulated. The clean up and flow-back of these intervals has been delayed due to operational issues with a packer. The preliminary results from this well are expected in early 2009. Results from the two stimulated horizontal wells on the Yamaska permits are on schedule for release by year-end.
Questerre is a Calgary-based independent resource company actively engaged in the exploration, development and acquisition of high-impact exploration and development oil and gas projects in Canada.
This news release contains forward-looking information. Implicit in this information are assumptions regarding commodity pricing, production, royalties and expenses, that, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. These forward-looking statements are based on certain assumptions that involve a number of risks and uncertainties and are not guarantees of future performance. Actual results could differ materially as a result of changes in the Company's plans, commodity prices, equipment availability, general economic, market, regulatory and business conditions as well as production, development and operating performance and other risks associated with oil and gas operations. There is no guarantee made by the Company that the actual results achieved will be the same as those forecasted herein.
Barrel of oil equivalent ("boe") amounts may be misleading, particularly if used in isolation. A boe conversion ratio has been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil and is based on an energy equivalent conversion method application at the burner tip and does not necessarily represent an economic value equivalent at the wellhead.
This news release does not constitute an offer of securities for sale in the United States. These securities may not be offered or sold in the United States absent registration or an available exemption from registration under the United States Securities Act of 1933, as amended.
FOR FURTHER INFORMATION PLEASE CONTACT:
Questerre Energy Corporation
Anela Dido
Investor Relations
(403) 777-1185
(403) 777-1578 (FAX)
Email: info@questerre.com
Website: www.questerre.com
Wednesday, December 3, 2008
Nexen Tumbles on Report Total Ditches Takeover Offer
Nexen Tumbles on Report Total Ditches Takeover Offer
By Joe Carroll and Tara Patel
Dec. 3 (Bloomberg) -- Nexen Inc., operator of the North Sea’s Buzzard oil field and Canada’s Long Lake tar-sands project, fell the most in 21 years after The Times of London reported Total SA abandoned plans to acquire the Calgary-based company.
Nexen fell C$2.51, or 10 percent, to C$21.75 on the Toronto Stock Exchange after earlier today dropping as much as 25 percent. The decline wiped out yesterday’s 11 percent gain following an FT Alphaville Web site report that Total was preparing a C$19.7 billion ($15.7 billion) bid for Nexen.
“Although a Total offer for Nexen is within the realms of possibility, we feel it is unlikely,” David Thomas, a London- based analyst at Citigroup Inc., said in a report today. “Hostile approaches have not been in Total’s style and it is our belief that the company would be unlikely to enter into a potential bidding war.”
Paris-based Total dropped 1.5 percent to 38.72 euros. The shares have lost 32 percent this year. The cost of protecting bonds sold by Total from default jumped to a record.
The Times didn’t say where it got its information. Total spokesman Paul Floren declined to comment on the reports.
Total has spent C$1.69 billion in the past three years amassing Canadian oil-sands assets, most recently with the purchase of Synenco Energy Inc. in August.
Indonesia to Brazil
Nexen pumps oil and natural gas from Indonesia to Brazil, and also makes chemicals. The company pumped the equivalent of about 207,000 barrels of crude a day in 2007, about one-twelfth of Total’s output.
Credit-default swaps on Total climbed 47 basis points to 153, according to CMA Datavision prices at 9:15 a.m. in London.
Credit-default swaps, contracts conceived to protect bondholders against default, pay the buyer face value in exchange for the underlying securities or the cash equivalent should a company fail to adhere to its debt agreements. An increase indicates a deterioration in the perception of credit quality; a decline, the opposite.
A basis point on a credit-default swap contract protecting 10 million euros ($12.6 million) of debt from default for five years is equivalent to 1,000 euros a year.
To contact the reporter on this story: Joe Carroll in Chicago at jcarroll8@bloomberg.net
Last Updated: December 3, 2008 16:10 EST
