British Petroleum in $7.8bn share swap with Rosneft

British Petroleum  has unveiled a $16bn share swap with Rosneft, the Russian state oil company, as part of an ambitious strategic alliance that will see the two companies explore in the Russian Arctic continental shelf.

Under the terms of the agreement, unveiled in London on Friday evening, Rosneft will take a stake of about Five per cent in British Petroleum in exchange for about 9.5 per cent in the Russian group. BP already has a 1.2 per cent stake. The aggregate value of shares in BP to be issued to Rosneft is about $7.8bn. The two companies have also agreed to explore and develop three licence blocks in the Russian Arctic, an area equivalent in size and prospectivity to the UK North Sea.

Igor Sechin, deputy prime minister of Russia, said the government held British Petroleum in the highest esteem and would make use of the experience the company gleaned during last year’s Gulf of Mexico spill.

Shares in British Petroleum rose as much as 4 per cent to $49.44 in New York in advance of the news, which came after the market closed. The shares had reached the highest point since May 6, on expectations of the announcement after BP had called a press conference earlier on Friday. The confirmation of talks came hours after Bob Dudley, chief executive, met Vladimir Putin at the Russian prime minister’s Moscow residence.

Speaking at the signing ceremony at British Petroleum head office in central London, Mr Dudley described the deal as “a historic moment for BP, for our industry and I believe for Russia and the wider world of energy globally”.

“Vladimir Putin, the Russian prime minister, told us in our meeting in Moscow it is an alliance based on mutual advantage and recognition of the great strengths that bring each of us together in our co-operation. This is truly the first alliance fit for the 21st century, based on the promise of the future and not the legacies of the past.”

“For the first time in the history of our industry there will be a significant cross-share holding between a major international oil company and a major national oil company.’

Mr Dudley said the agreement “demonstrates mutual confidence and trust” between the two companies and defined a “new template” for how business can be done in the industry.

Mr Dudley said the two companies had talked about an exploration venture for a number of years but the decision to form a deeper alliance with a share swap had come up in the past two to three months. The deal, he said, fitted with BP’s strategy to access large hydrocarbon basins and new ones, alongside a “continued focus on the management of risk”. He said in spite of environmental concerns about drilling in the Arctic, one of the few unexplored hydrocarbon regions in the world, BP had learnt “the harsh lessons” of the Gulf of Mexico spill.

“Given the circumstances where we believe our shares are undervalued and Rosneft’s shares are undervalued it began to make sense in a different way beyond just an exploration contract. That there was a way here to align our interests,” Mr Dudley said.

Asked whether BP would have agreed a share swap if the accident in the US had not happened, he said “we might have”.

However, the deal has already drawn fire in the US where Edward J. Markey, the top Democrat on the House natural resources committee, called for a thorough analysis of the agreement.

If the deal is found to affect the operations of BP America, he said the committee on foreign investment in the US, a Treasury Department entity tasked with reviewing and acting upon the national security implications of foreign investments, should analyse the deal.

Lambert Energy Advisory acted as advisor to BP.

(source:Ft.com)

Obama hits Northeast, Midwest to stem GOP tide

CHICAGO — On his final campaign swing through four states in the Northeast and Midwest before Tuesday's midterm elections, President Barack Obama is asking Democratic voters to go to the polls and help stem an expected Republican tide.

"Chicago, it's up to you to let them know that we have not forgotten, we don't have amnesia," the president told a large outdoor crowd late Saturday near his home, referring to the economic recession that hit during George W. Bush's presidency. He said the election is a choice between the policies that caused the problems and policies that will lead the country to better times.

All four stops are in states Obama carried in 2008 — Pennsylvania, Connecticut, Illinois and Ohio — and where Democrats are struggling this year. He is to headline a final rally Sunday in Cleveland before returning to Washington for Halloween with his family and other children invited to the White House.

Obama acknowledged the difficulties Democrats face — the distinct chance of losing their comfortable majority in the House and possibly the Senate, as well as several governors' seats.

"There's no doubt this is a tough election," he said Saturday during a campaign stop in Philadelphia, "because we have been through an incredibly difficult time as a nation."

Unless Democratic voters turn out in big numbers, Obama said, all the progress made in the past two years "can be rolled back." Obama urged Democrats to "defy the conventional wisdom" that foresees huge GOP wins.

The Democratic National Committee put an ad featuring Obama on the air this weekend that warned of record cuts in education and rollbacks in financial accountability if Republicans take control of Congress.

In his appearances Saturday, Obama did not mention the thwarted mail bomb plot or the arrest in Yemen of a woman suspected of sending two mail bombs.

He focused on the fast-approaching elections.

In many races, vast numbers of the electorate had already made their choices. In Ohio, where Democrats could lose as many as six House seats, more than 721,000 votes had been cast. California officials already had in hand almost 2.5 million ballots, and Florida officials had almost 1.7 million.

Both parties worked vigorously to bank supporters' votes early. In all, more than 13.5 million votes had been cast early, either at ballot boxes that opened early or by mail. Four years ago, during the last non-presidential election, some 19 million voters cast ballots before Election Day.

Candidates were everywhere on Saturday, making last-weekend pitches for support.

Party stars were out in force, too.

Sarah Palin and her husband, Todd, campaigned for Republican Senate candidate John Raese at a big rally in Charleston, W.Va. Palin said the state's Democratic governor, Joe Manchin, is a good fit in that job — so voters should keep him there rather than elect him senator over Raese.

Former President Bill Clinton, campaigning for Ohio Gov. Ted Strickland's re-election, called the Republican pledge "a joke." He said, "Their deal sounds good but it doesn't work. ... Our ideas work better than theirs."

Later in Canton, Ohio, as Clinton was speaking at a rally, Ohio Rep. John Boccieri ran offstage after receiving word that his pregnant wife had gone into labor.

"The baby is now being born!" Clinton announced as the crowd erupted with cheers. "We got another Democrat."

(source:ajc.com)

Oil spill

Gulf of Mexico Oil spill,

An oil spill is a release of a liquid petroleum hydrocarbon into the environment due to human activity, and is a form of pollution. The term often refers to marine oil spills, where oil is released into the ocean or coastal waters. Oil spills include releases of crude oil from tankers, offshore platforms, drilling rigs and wells, as well as spills of refined petroleum products (such as gasoline, diesel) and their by-products, and heavier fuels used by large ships such as bunker fuel, or the spill of any oily refuse or waste oil. Spills may take months or even years to clean up.

Oil also enters the marine environment from natural oil seeps. Most human-made oil pollution comes from land-based activity, but public attention and regulation has tended to focus most sharply on seagoing oil tankers.

Environmental effects

Surf Scoter covered in oil as a result of the 2007 San Francisco Bay oil spill. Less than 1% of oil soaked birds survive, even after cleaning.

The oil penetrates, up the structure of the plumage of birds, reducing its insulating ability, and so making the birds more vulnerable to temperature fluctuations and much less buoyant in the water. It also impairs birds' flight abilities to forage and escape from predators. As they attempt to preen, birds typically ingest oil that covers their feathers, causing kidney damage, altered liver function, and digestive tract irritation. This and the limited foraging ability quickly causes dehydration and metabolic imbalances. Hormonal balance alteration including changes in luteinizing protein can also result in some birds exposed to petroleum.

Most birds affected by an oil spill die unless there is human intervention. Marine mammals exposed to oil spills are affected in similar ways as seabirds. Oil coats the fur of Sea otters and seals, reducing its insulation abilities and leading to body temperature fluctuations and hypothermia. Ingestion of the oil causes dehydration and impaired digestions. Because oil floats on top of water, less sunlight penetrates into the water, limiting the photosynthesis of marine plants and phytoplankton. This, as well as decreasing the fauna populations, affects the food chain in the ecosystem.[citation needed] There are three kinds of oil-consuming bacteria. Sulfate-reducing bacteria (SRB) and acid-producing bacteria are anaerobic, while general aerobic bacteria (GAB) are aerobic. These bacteria occur naturally and will act to remove oil from an ecosystem, and their biomass will tend to replace other populations in the food chain.

Cleanup and recovery

Clean-up efforts after the Exxon Valdez oil spill.

A US Navy oil spill response team drills with a "Harbour Buster high-speed oil containment system".

Cleanup and recovery from an oil spill is difficult and depends upon many factors, including the type of oil spilled, the temperature of the water (affecting evaporation and biodegradation), and the types of shorelines and beaches involved.

Methods for cleaning up include:

Bioremediation: use of microorganisms or biological agents to break down or remove oil.

Bioremediation Accelerator: Oleophilic, hydrophobic chemical, containing no bacteria, which chemically and physically bonds to both soluble and insoluble hydrocarbons. The bioremedation accelerator acts as a herding agent in water and on the surface, floating molecules to the surface of the water, including solubles such as phenols and BTEX, forming gel-like agglomerations. Undetectable levels of hydrocarbons can be obtained in produced water and manageable water columns. By overspraying sheen with bioremediation accelerator, sheen is eliminated within minutes. Whether applied on land or on water, the nutrient-rich emulsion creates a bloom of local, indigenous, pre-existing, hydrocarbon-consuming bacteria. Those specific bacteria break down the hydrocarbons into water and carbon dioxide, with EPA tests showing 98% of alkanes biodegraded in 28 days; and aromatics being biodegraded 200 times faster than in nature they also sometimes use the hydrofireboom to clean the oil up by taking it away from most of the oil and burning it.

Controlled burning can effectively reduce the amount of oil in water, if done properly. But it can only be done in low wind,[citation needed] and can cause air pollution.

Oil slicks on Lake Maracaibo.

Volunteers cleaning up the aftermath of the Prestige oil spill.

Dispersants act as detergents, clustering around oil globules and allowing them to be carried away in the water.[13] This improves the surface aesthetically, and mobilizes the oil. Smaller oil droplets, scattered by currents, may cause less harm and may degrade more easily. But the dispersed oil droplets infiltrate into deeper water and can lethally contaminate coral. Recent research indicates that some dispersants are toxic to corals.

Watch and wait: in some cases, natural attenuation of oil may be most appropriate, due to the invasive nature of facilitated methods of remediation, particularly in ecologically sensitive areas.[citation needed]

Dredging: for oils dispersed with detergents and other oils denser than water.

Skimming: Requires calm waters

Solidifying: Solidifiers are composed of dry hydrophobic polymers that both adsorb and absorb. They clean up oil spills by changing the physical state of spilled oil from liquid to a semi-solid or a rubber-like material that floats on water. Solidifiers are insoluble in water, therefore the removal of the solidified oil is easy and the oil will not leach out. Solidifiers have been proven to be relatively non-toxic to aquatic and wild life and have been proven to suppress harmful vapors commonly associated with hydrocarbons such as Benzene, Xylene, Methyl Ethyl, Acetone and Naphtha. The reaction time for solidification of oil is controlled by the surf area or size of the polymer as well as the viscosity of the oil. Some solidifier product manufactures claim the solidified oil can be disposed of in landfills, recycled as an additive in asphalt or rubber products, or burned as a low ash fuel. A solidifier called C.I.Agent (manufactured by C.I.Agent Solutions of Louisville, Kentucky) is being used by BP in granular form as well as in Marine and Sheen Booms on Dauphin Island, AL and Fort Morgan, MS to aid in the Deepwater Horizon oil spill cleanup.

Vacuum and centrifuge: oil can be sucked up along with the water, and then a centrifuge can be used to separate the oil from the water - allowing a tanker to be filled with near pure oil. Usually, the water is returned to the sea, making the process more efficient, but allowing small amounts of oil to go back as well. This issue has hampered the use of centrifuges due to a United States regulation limiting the amount of oil in water returned to the sea.

Equipment used includes:

Booms: large floating barriers that round up oil and lift the oil off the water

Skimmers: skim the oil

Sorbents: large absorbents that absorb oil

Chemical and biological agents: helps to break down the oil

Vacuums: remove oil from beaches and water surface

Shovels and other road equipments: typically used to clean up oil on beaches

Prevention

Seafood Sensory Training- in an effort to detect oil in seafood, inspectors and regulators are being trained to sniff out seafood tainted by oil and make sure the product reaching consumers is safe to eat.

Secondary containment - methods to prevent releases of oil or hydrocarbons into environment.

Oil Spill Prevention Containment and Countermeasures (SPCC) program by the United States Environmental Protection Agency.

Double-hulling - build double hulls into vessels, which reduces the risk and severity of a spill in case of a collision or grounding. Existing single-hull vessels can also be rebuilt to have a double hull.

Environmental Sensitivity Index (ESI) mapping

Environmental Sensitivity Index (ESI) maps are used to identify sensitive shoreline resources prior to an oil spill event in order to set priorities for protection and plan cleanup strategies. By planning spill response ahead of time, the impact on the environment can be minimized or prevented. Environmental sensitivity index maps are basically made up of information within the following three categories: shoreline type, and biological and human-use resources.

Shoreline type

Shoreline type is classified by rank depending on how easy the garet would be to cleanup, how long the oil would persist, and how sensitive the shoreline is. The floating oil slicks put the shoreline at particular risk when they eventually come ashore, covering the substrate with oil. The differing substrates between shoreline types vary in their response to oiling, and influence the type of cleanup that will be required to effectively decontaminate the shoreline. In 1995, the US National Oceanic and Atmospheric Administration extended ESI maps to lakes, rivers, and estuary shoreline types. The exposure the shoreline has to wave energy and tides, substrate type, and slope of the shoreline are also taken into account – in addition to biological productivity and sensitivity. The productivity of the shoreline habitat is also taken into account when determining ESI ranking. Mangroves and marshes tend to have higher ESI rankings due to the potentially long-lasting and damaging effects of both the oil contamination and cleanup actions. Impermeable and exposed surfaces with high wave action are ranked lower due to the reflecting waves keeping oil from coming onshore, and the speed at which natural processes will remove the oil.

Biological resources

Habitats of plants and animals that may be at risk from oil spills are referred to as “elements” and are divided by functional group. Further classification divides each element into species groups with similar life histories and behaviors relative to their vulnerability to oil spills. There are eight element groups: Birds, Reptiles Amphibians, Fish, Invertebrates, Habitats and Plants, Wetlands, and Marine Mammals and Terrestrial Mammals. Element groups are further divided into sub-groups, for example, the ‘marine mammals’ element group is divided into dolphins, manatees, pinnipeds (seals, sea lions & walruses), polar bears, sea otters and whales. Issues taken into consideration when ranking biological resources include the observance of a large number of individuals in a small area, whether special life stages occur ashore (nesting or molting), and whether there are species present that are threatened, endangered or rare.

Human-use resources

Human use resources are divided into four major classifications; archaeological importance or cultural resource site, high-use recreational areas or shoreline access points, important protected management areas, or resource origins.Some examples include airports, diving sites, popular beach sites, marinas, natural reserves or marine sanctuaries.

]Estimating the volume of a spill

By observing the thickness of the film of oil and its appearance on the surface of the water, it is possible to estimate the quantity of oil spilled. If the surface area of the spill is also known, the total volume of the oil can be calculated.

Film thickness Quantity spread,

Appearance in mm nm gal/sq mi L/ha,

Barely visible 0.0000015 0.0000380 38 25 0.370,

Silvery sheen 0.0000030 0.0000760 76 50 0.730,

First trace of color 0.0000060 0.0001500 150 100 1.500,

Bright bands of color 0.0000120 0.0003000 300 200 2.900,
Colors begin to dull 0.0000400 0.0010000 1000 666 9.700,

Colors are much darker 0.0000800 0.0020000 2000 1332 19.500,

Oil spill model systems are used by industry and government to assist in planning and emergency decision making. Of critical importance for the skill of the oil spill model prediction is the adequate description of the wind and current fields. There is a worldwide oil spill modelling (WOSM) program. the scope of an oil spill may also involve verifying that hydrocarbons collected during an ongoing spill are derived from the active spill or some other source. This can involve sophisticated analytical chemistry focused on finger printing an oil source based on the complex mixture of substances present. Largely, these will be various hydrocarbons, among the most useful being polyaromatic hydrocarbons. In addition, both oxygen and nitrogen heterocyclic hydrocarbons, such as parent and alkyl homologues of carbazole, quinoline, and pyridine, are present in many crude oils. As a result, these compounds have great potential to supplement the existing suite of hydrocarbons targets to fine tune source tracking of petroleum spills. Such analysis can also be used to follow weathering and degradation of crude spills.,

Largest oil spills,

Oil spills of over 100,000 tons or 30 million US gallons, ordered by tons[a]

Spill / Tanker Location Date *Tons of crude oil Barrels US Gallons References

Lakeview Gusher United States, Kern County, California May 14, 1910 – September, 1911 1,200,000 9,000,000 378,000,000 

Deepwater Horizon United States, Gulf of Mexico April 20, 2010 – July 15, 2010 560,000-585,000 4,100,000-4,300,000 172,000,000-180,000,000 

Gulf War oil spill [b] Iraq, Persian Gulf and Kuwait January 23, 1991 270,000–820,000 2,000,000–6,000,000 84,000,000–250,000,000 

Ixtoc I Mexico, Gulf of Mexico June 3, 1979 – March 23, 1980 454,000–480,000 3,329,000–3,520,000 139,818,000–147,840,000 

Atlantic Empress / Aegean Captain Trinidad and Tobago July 19, 1979 287,000 2,105,000 88,396,000 Fergana Valley Uzbekistan March 2, 1992 285,000 2,090,000 87,780,000 

Nowruz Field Platform Iran, Persian Gulf February 4, 1983 260,000 1,907,000 80,080,000 

ABT Summer Angola, 700 nmi (1,300 km; 810 mi) offshore May 28, 1991 260,000 1,907,000 80,080,000 

Castillo de Bellver South Africa, Saldanha Bay August 6, 1983 252,000 1,848,000 77,616,000 

Amoco Cadiz France, Brittany March 16, 1978 223,000 1,635,000 68,684,000 

MT Haven Italy, Mediterranean Sea near Genoa April 11, 1991 144,000 1,056,000 44,352,000 

Odyssey Canada, 700 nmi (1,300 km; 810 mi) off Nova Scotia November 10, 1988 132,000 968,000 40,656,000 

Sea Star Iran, Gulf of Oman December 19, 1972 115,000 843,000 35,420,000 

Irenes Serenade Greece, Pylos February 23, 1980 100,000 733,000 30,800,000 

Urquiola Spain, A Coruña May 12, 1976 100,000 733,000 30,800,000 

Torrey Canyon United Kingdom, Isles of Scilly March 18, 1967 80,000–119,000 587,000–873,000 24,654,000–36,666,000 

Greenpoint Oil Spill United States, Brooklyn, New York City 1940–1950s 55,000– 97,000 400,000–710,000 17,000,000–30,000,000 

a One ton of crude oil is roughly equal to 308 US gallons or 7.33 barrels approx.; 1 oil barrel is equal to 35 imperial or 42 US gallons.

b Original estimates for the spill were as high as 11,000,000 barrels, however these numbers were corrected downward by subsequent, more detailed studies.

(source:wikipedia)