05.07.2009

Caspian Sea is an area including the Sea’s littoral states of Azerbaijan, Kazakhstan and Turkmenistan, as well as parts of Russia and Iran. Uzbekistan, although not a littoral state, is the region’s largest natural gas producer and is therefore included in the region. The countries of the Caspian Sea region are relatively minor world oil and natural gas producers, struggling with difficult economic and political transitions following the collapse of the Soviet Union. The Caspian Sea region, including the Sea and the states surrounding it, however is important to world energy markets because of its potential to become a major oil and natural gas exporter over the next decade. Indeed, the Caspian Sea region has become a central focal point for untapped oil and natural gas resources from the southern portion of the former Soviet Union. Beginning in May 2005, oil from the southern sections of the Caspian Sea began pumping through a new pipeline (built by a BP-led consortium) to the Turkish seaport of Ceyhan. The 8-year effort of Western capital, technology, and diplomacy had aimed to decrease reliance on Middle Eastern oil. Although oil reserve growth in the Caspian region has not met levels that had been expected in the 1990s, European countries are paying special attention to the natural gas resources that could lie beneath the Sea as a way to diversify their sources of gas imports

Powder consisting of alumina, silica, lime, and other substances that hardens when mixed with water. Extensively used in the oil industry to bond casing to the walls of the wellbore.

A carried interest is an agreement under which one party (the carrying party) agrees to pay for a portion or all of the pre-production costs of another party (the carried party) on a license in which both own a portion of the working interest. This arises when the carried party is either unwilling to bear the risk of exploration or is unable to fund the cost of exploration or development directly. Sometimes the government is even the carried party by an oil and gas company

The largest producer of natural gas in the US. Headquartered in Oklahoma City, the company’s operations are focused on exploratory and developmental drilling and corporate and property acquisitions. Chesapeake is a leader in the extraction of gas shale, but with the credit crunch in the summer of 2008, the company has found itself unable to access the credit market and has been forced to sell certain of its properties to raise cash, such as to BP that has ample cash lying around and is under pressure to expand its portfolio of energy projects as concerns mount about its ability to expand production.

The application of a liquid slurry of cement and water to various points inside or outside the casing

In a Gas Sales Agreement (GSA) if the buyer takes more than his TOP or ACQ amount of gas in any year (depending on what was agreed), he will then receive a credit for the overtake. This is aggregated with all overtake credits from previous years as a carry forward balance.

Thereafter, if the buyer takes less than the ToP amount, he can then reduce his ToP liability by the amount of the carry forward balance. The buyer will want to negotiate as long a period as possible and certainly longer than 1 year. If the ToP is high, then the carry forward period should be longer as there is smaller chance that the buyer will be able to enjoy the carry forward as he will be meeting his ToP obligations more frequently

Charter Rate is the agreed cost of hiring a tanker. Spot charter rates, mostly negotiated in worldscale terms, are tariffs for the carriage of a single cargo from one specified port to another (including the return ballast journey) in the immediate future (generally within the next six weeks). Spot rates typically include all expenses of operating the vessel, from fuel to crew, but exclude costs related to the cargo (e.g. inspection fees). Time charter rates are a daily rate of hire over a fixed period, in which tanker owners pay for vessel expenses (such as maintenance and vessel insurance) and the charterer pays for voyage costs (such as bunkers).

Non-toxic, naturally occurring gas. Also a byproduct of burning fossil fuels. One of the greenhouse gases that affects the Earth’s temperature