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Oil & Gas Journal

So far, the impact of the massive May 12 earthquake in Sichuan province in central China remains uncertain, but damage to hydroelectric facilities could prove to be critical. The earthquake is reported to have damaged as many as 17 dams in Sichuan as well as in neighboring provinces. French nuclear experts say the earthquake possibly could have damaged several nuclear fuel and research sites as well.

The southwest Sichuan province is China's main gas producer and consumer, accounting for a quarter of China's total gas production. PetroChina, the primary operator, said it has restored a third of the daily output of 6 million cu m of gas that was shut in after the quake.

Sinopec's giant Chuanxi gas field in the Sichuan province was reported running at 20% of capacity after many chemical plants closed, up from only 10% earlier when 1,000 gas wells were shut in. As of May 15, the field was reported to be producing 1.6 million cu m/day.

Energy prices
The July crude contract lost 26¢ to $123.85/bbl May 15 on NYMEX. On the US spot market, WTI at Cushing, Okla., was down 11¢ to $124.12/bbl. The June contract for reformulated blend stock for oxygenate blending (RBOB) declined 1.99¢ to $3.17/gal. However, heating oil for the same month inched up 0.46¢ to $3.62/gal.

The June natural gas contract closed at $11.40/MMbtu, down only 1.99¢ for the day on NYMEX. On the US spot market, gas at Henry Hub, La., lost 8.5¢ to $11.41/MMbtu.

In London, the expiring June IPE contract for North Sea Brent crude dropped 61¢ to $121.25/bbl. The June gas oil contract gained $2.50 to $1,198.25/tonne.

The average price for the Organization of Petroleum Exporting Countries' basket of 13 reference crudes increased 17¢ to $118.95/bbl on May 15.

Contact Sam Fletcher at samf@ogjonline.com.