UPDATE 1-Statoil to build US shale crude shipping capacity
* Statoil plans to add four rigs in the coming few yearsBy Selam GebrekidanNEW YORK, Oct 17 (Reuters) - Norway’s Statoil (STL.OL) will
build more crude shipping capacity in the Williston Basin of
North Dakota and Montana as part of its $4.4 billion bid for
Austin-based Brigham Exploration (BEXP.O) a company executive
said on Monday.The Norwegian state oil company said it would build more
shipping capacity, with a focus on pipelines, but did not
commit itself to any specific pipeline project.Analysts said that because of the deal’s steep cost, the
oil major will have to invest in infrastructure projects to
recover some of its investment as it ramps up production.Statoil is looking to enter the Bakken and Three Forks
shale plays in North Dakota with its purchase of Brigham, a
company that entered the race to unlock North Dakota’s massive
unconventional oil reserves in 2005.The deal, announced on Monday, will buy the cash-rich
international oil company a 275,000 net-acre shale frontier in
North Dakota and 100,000 acres more in Montana, where output
growth is outpacing existing capacity to move crude to refining
hubs in the Gulf Coast and elsewhere.Statoil plans to add more take-away capacity in the region,
building on Brigham’s $120 million-a-year investment in the
past, according to Bill Maloney, Statoil North America
Executive Vice President. Brigham had focused its efforts on
building pipelines.Analysts said it is in Statoil’s interest to invest in
additional infrastructure in the region to boost production and
get oil to customers.”They paid a pretty high premium for what the acreage
really is worth. They need to develop the assets quickly so
they will improve the infrastructure,” Sven Del Pozzo, senior
analyst with energy consultancy IHS Herold said.Brigham currently produces 21,000 barrels of oil equivalent
a day in the Williston basin, home to both the Bakken and Three
Forks shale plays, and has enough acreage to increase output to
up to 100,000 boed in five years, according to a Statoil press
release.Following the successful completion of the deal, Statoil
plans to increase the number of drilling rigs from 12 to 16 in
the coming few years, starting with the addition of two rigs in
the first quarter of 2012, Maloney added.Recent advances in horizontal drilling and hydraulic
fracturing technologies have repeated the shale gas revolution
in oil-rich shale prospects like the Bakken in North Dakota.North Dakota’s oil output reached a record high above
444,000 barrels-per-day in August, thanks primarily to fracking
technology, which pumps chemical-laden water and sand into
wells to retrieve oil, according to state regulators.Total U.S. oil production from shale plays is currently
estimated at 700,000 bpd but could grow to as much as 2 million
bpd in the coming five to seven years, industry operators say.As cheap gas from the shale prospects inundated the market
and halved the price of natural gas over the past three years,
exploration companies have increasingly turned their attention
to oil fields.Statoil is one of the latest oil majors to do so. The
company has a stake in the Marcellus shale gas project with
Chesapeake (CHK.N) in north-east America and owns acreage in
the Eagle Ford prospect in Texas, together with Canada’s
Talisman (TLM.TO).
WRAPUP 1-Libyan govt beefs up security after clashes in capital
By Barry MaloneTRIPOLI, Oct 15 (Reuters) - Libya’s new government beefed up
security in Tripoli on Saturday with extra roadblocks and
house-to-house searches after fighting in the capital with
supporters of Muammar Gaddafi raised fears of an insurgency.At most a few dozen pro-Gaddafi fighters appeared on Friday
in only a few neighbourhoods of the city which are known to be
sympathetic to the deposed ruler.But it was still the first sign of armed resistance to the
National Transitional Council in Tripoli since its forces seized
the city in August and ended Gaddafi’s 42 years of one-man rule.Government forces mounted an increased number of roadblocks
across the city, but especially in and around Abu Salim, an area
of run-down apartment blocks.Pick-up trucks with heavy weapons were stationed inside the
district, firing occasional volleys over the houses to make
their presence felt. NTC foot soldiers searched the buildings,
but there were no further clashes on Saturday.”During the war Gaddafi hid guns among the people here,”
said Ziyad, an NTC fighter. He said he and his comrades had
found five AK47 assault rifles hidden in a water tower on the
top of one of the buildings and another two in the basement.Residents said fighting broke out when a group of up to 50
armed men had appeared in the Abu Salim district on Friday and
at least one other nearby area and chanted pro-Gaddafi slogans.Hundreds of NTC fighters in pick-up trucks shouting “Allahu
Akbar” (God is greatest) careered towards the Abu Salim
neighbourhood, a repository of support for Gaddafi, and the two
sides exchanged rifle and heavy machinegun fire.Two Gaddafi supporters and one NTC fighter were killed in
the violence, NTC official Abdel Razak al Oraidi told a news
conference in the capital.TRAPPEDSince he went into hiding after rebel forces captured
Tripoli on August 23, Gaddafi has released a number of audio
recordings calling on loyalists to fight back.But the former strongman has not been seen and is thought to
be hiding somewhere in the vast Libyan desert.His supporters however are still holding out in his hometown
Sirte, on the Mediterranean coast in the centre of the country,
and in Bani Walid, a town southeast of Tripoli.Government forces kept up their bombardment of a small area
in the centre of Sirte on Saturday with Grad multiple rocket
launchers, as well as tanks and anti-aircraft guns, but there
was little sign of a major push under way from the infantry.NTC militia have besieged Sirte for weeks, only slowly
tightening their grip to the point where now Gaddafi die-hards
are surrounded in an area of about two sq km (a sq mile). Green
flags, the banner of Gaddafi’s rule, still fly over the area.The often chaotic struggle has cost scores of lives and left
thousands homeless.The failure to seize the final Gaddafi bastions has also
held up the attempt by Libya’s new leaders to try to build a
democratic government, a process they say will begin only after
Sirte is captured.”It is taking so long because the area is crowded with
buildings and there is a large number of them; between 400 to
500 Gaddafi men,” said Hussein Alteir, a brigade commander in
Sirte.NTC officers say Gaddafi loyalists fear reprisals if they
surrender — some captured fighters have been abused.A Medecins Sans Frontieres doctor at Sirte’s Ibn Sina
hospital estimated there were still some 10,000 people marooned
by the fighting in the city of 75,000 residents. Many of those
trapped are women and children and some are sick or injured.”In the past few days, the patients haven’t been able to
receive proper medical care, due to a shortage of doctors and
due to the lack of water,” said Gabriele Rossi. “The wounds of
some patients are really bad and very infected.”
