China's imports of liquefied petroleum gas (LPG) surged 15.2% year-on-year to hit 6.98 million tons, valued at US$3.09 billion, according to sources.

The liquefied natural gas imports surged 320% to 2.91 million tons, accounting for 41.7% of the total imports, according to sources with the General Administration of Customs on Saturday.

Of the total LPG imports, 83.4% or 5.82 million tons were imported by the foreign-funded companies, up 37.5%. The main import sources were from Australia and the Middle East, with 3.38 million tons and 2.83 million tons respectively, accounting for 18.55% and 20.6% of the total.

Industry observers predicted China would continue to face the short supply of LPG in a short term, as the LPG importers would reduce their imports due to the limited profits.

China Huaneng Group will buy Singapore's Tuas Power Ltd for S$4.24 billion (US$3.1 billion) in China's second-biggest overseas acquisition this year.

The Beijing-based company has signed an agreement to buy Tuas Power from Temasek Holdings Pte, Huaneng, China's biggest power producer, said on its Website Friday.

The transaction is expected to be completed by March 24, Singapore's state investment company said in a separate statement.

The purchase "represents a major step for China Huaneng in its goal to diversify its assets across geographies and technologies," Vice President Huang Long said in the statement.

Tuas Power, the first of three utilities Temasek is selling, was set up in 1995 and has 2,670 megawatts of capacity built at a cost of S$2 billion.

Its power station at the western end of the city state comprises four blocks of natural-gas-fired combined cycle plants and two units of steam plants.

"The move is a natural extension of the Chinese power producer's core competencies," Donovan Huang, a Nomura Securities Ltd analyst, said by phone from Hong Kong. "Huaneng has sound management and has some gas-fired management experience."

For the year to March 2007, Tuas Power had revenue of S$2.27 billion, up 31 percent from a year earlier, its financial report showed.

Net income for the year to March 31 was S$177 million, 70 percent more than a year earlier. At December 31, Tuas Power's net debt stood at S$71 million.

Wong Kim Yin, Temasek's managing director for investments, said in the statement that China Huaneng's proposal, through its subsidiary SinoSing Power Ltd, was the "most attractive." It was the clear winner on price and commercial terms, according to the statement.

Kuwait’s Al-Kharafi Group on Sunday bought shares in Sudanese oil company Petrodar Company, taking some 3 percent stake of the capital.

According to KUNA, the official Kuwaiti news agency, Al-Kharafi has agreed to buy a 3 percent stake of Perodar at a value of 500 USD million from Thani, a Dubai based firm. The Kuwaiti group signed the contract with the Sudapet in Khartoum on Sunday.

Sudapet Director-General Saleh Jaafar told reporters that the company had agreed to buy Thani’s five-percent stake in Petrodar, noting that Al-Kharafi would acquire three percent while the Sudanese company would obtain two percent.

Al-Kharafi Group Deputy Director-General Marzouk al-Kharafi said his company had agreed with the Ministry of Energy to enter agricultural and animal investment in Sudan, which abounds in natural potential and resources in such fields.

Thani Group had bought the sold shares for USD two million. The Sudanese responsible said that the agreement with Al-Kharafi came due to its large experience in the oil field.

The deal would raise Sudapet’s stake to 10 percent in Petrodar, which operates the Dar Blend field. Dar’s exports were estimated at about 200,000 barrels per day in mid-2007. The Sudan produces around 500,000 bpd of crude oil.

Petrodar was set up to explore, develop and produce oil and gas from blocks 3 and 7 in the south east with a total area of about 72,000 square km (27,800 square mile).

Petrodar is a venture between China National Petroleum Company International (Nile) Ltd, Petronas Carigali Overseas Sdn Bhd, Sudapet Ltd, Gulf Oil Petroleum Ltd and Al Thani Corp. The Chinese Sinopec holds the majority 41 percent stake in Petrodar, the Malaysian Petronas, holds 40 percent, while Sudapet, Gulf oil and Al Thani jointly hold the remaining 19 percent.

Algonquin community leader Robert Lovelace had never been charged with an offence, but when a uranium company began prospecting for radioactive ore on unceded First Nations land without engaging in consultation, he decided to take action and organized a non-violent blockade.

On February 15, Judge Cunningham of Ontario's Superior Court sentenced Lovelace to six months in jail for contempt of court and fined him $50,000 for his involvement in the peaceful protest.

Chief Paula Sherman, elected leader of the Ardoch Algonquin First Nation, a small community about 110 kilometres southwest of Ottawa, where the controversial uranium prospecting is taking place, calls Robert Lovelace "a political prisoner."

"It seems like a very heavy sentence," said Jamie Kneen of Mining Watch Canada, a non-governmental watchdog. "If the court had issued a trespassing charge, there could have been an argument about who was really trespassing."

The territory in question involves mainly Crown land that is subject to ongoing land-claim negotiations between First Nations and the provincial and federal governments.

In September 2007, an Ontario provincial court issued Frontenac Ventures, the mining company, an interlocutory injunction ordering protestors from Ardoch and Sharbot Lake First Nations, along with their non-native allies, to vacate the Robertsville camp. The camp is the only feasible entry point to a 30,000-acre wilderness tract in Frontenac County, where the company has its prospecting license. Lovelace and other activists violated that order.

"The source of this conflict is the Ontario Mining Act, which allows companies to stake land and prospect without consultation with private land owners or other users, including First Nations," said Kneen. Lovelace and other activists argue their constitutional rights were violated by the lack of consultation.

People living on or near the exploration site discovered their land was being taken almost two years ago. There were no community meetings or information sessions about the uranium exploration. "It started on private land when a cottager saw trees being cut and started protesting the development," said Kneen. A few months later it became clear that some of the land being staked was disputed territory.

"Uranium mining has no record other than environmental destruction and negative health issues," said Doreen Davis, chief of the Shabot Lake First Nation. "Uranium can't be stored safely," said Davis, who will be sentenced on March 18 for participating in the blockade. She is under court order not to talk about the dispute with Frontenac.

"I do know that we have communities from Kingston to Ottawa on our side against uranium mining in this district," said Davis. "A huge group of settlers, that's what they call themselves, have been working with us, pounding the pavement and educating people about this. I think it is unique to have aboriginal and non-aboriginal people standing shoulder-to-shoulder like this."

The federal government has yet to get involved in this case and Ontario's provincial government has only been reluctantly and peripherally involved, according to Kneen.

Not much is known about the company at the centre of the dispute. "Frontenac is a private company, so they don't have to file any disclosure," said Kneen. "Aside from the president and their lawyer, no one knows who they are or where they get their money."

The company's website has only one page and a press release. Frontenac's president, George White, did not return calls. The website says the company "is committed to participating in any efforts of Ontario and the First Nations' to consult in good faith," but Ardoch Chief Paula Sherman isn't convinced.

"No consideration was given to the circumstances leading to our actions," said Sherman in a statement following Lovelace's sentencing. "The testimony given under oath by Robert Lovelace outlined Algonquin Law and the corresponding responsibilities of Algonquin people with respect to human activity in our territory," wrote Sherman, who was fined $15,000 during the court case for breaking the injunction that prohibited protests on land being explored by Frontenac.

Because the company obtained a court order against protestors rather than filing trespassing charges, the judge was not required to consider arguments regarding historical precedent or Algonquin legal codes when making the decision. "It's a way of avoiding the core issues," said Kneen.

After a decade of low prices, the spot price of uranium has increased drastically in recent years, from $43 per pound in 2006, to $75 today.

As oil prices rise, countries have re-started old nuclear reactors and countries like South Africa, India and China have ambitious nuclear-power plans on the horizon. UBS, a financial services company, predicts uranium will hit $110 per pound by 2010.

These developments don't sit well with Dr. Mark Winfield, a Canadian nuclear expert. "Existing [uranium] mines in northern Saskatchewan have caused severe contamination through heavy metals like arsenic, and long-lived radionuclides, along with conventional pollutants," said Winfield.

In 2004, Health Canada concluded that effluent from uranium mines meets the definition of a toxic substance under the Canadian Environmental Protection Act.

Canada is the world's largest supplier of uranium and Conservative Prime Minister Stephen Harper wants to increase exports in his bid to transform the country into an "energy superpower."

"The Intergovernmental Panel on Climate Change was very clear that nuclear [energy] can't compete economically," said Winfield. "The potential health and environmental impacts of uranium mining are not worth the risks."

Chevron Corporation (NYSE:CVX) told financial analysts at a meeting in New York City today that major upstream capital projects in the U.S. Gulf of Mexico, offshore Nigeria and in Kazakhstan will produce additional crude oil and natural gas this year. In the downstream business, company executives said projects to increase refining scale and flexibility are under way in areas of market strength in the United States and Asia.

"We are focused on execution as a top priority for 2008 and 2009" Dave O’Reilly, Chevron’s chairman and CEO, said at the company’s annual analyst meeting. "This entails excelling at operational performance, executing our capital projects well and effectively managing costs"

O’Reilly’s presentation outlined the momentum Chevron has developed in key areas of its business plan:

* Significant upstream and downstream presence in the highest-growth regions of the world.
* Outstanding queue of upstream projects in all phases of engineering and construction.
* Successful exploration program that provides resources for oil and gas development projects.
* Improved refinery capabilities to process heavier, higher-sulfur crudes.

UPSTREAM – EXPLORATION AND PRODUCTION

George Kirkland, executive vice president for Global Upstream and Gas, said a track record of exploration success and project execution is expected to grow Chevron’s production capacity and boost proved reserves of crude oil and natural gas.

The company has approximately 40 major capital projects with a net Chevron investment of $1 billion or more each. Of those, important projects – including Blind Faith in the Gulf of Mexico, the Sour Gas Injection/Second Generation Plant in Kazakhstan and Agbami in Nigeria – are planned to increase production capacity in 2008. In 2009, Tombua Landana in Angola, Frade in Brazil and Tahiti in the Gulf of Mexico are expected to come online and further grow production capacity.

Kirkland also explained that the company’s exploration teams had another strong year in 2007. Each year from 2002 through 2007, Chevron’s exploration program has added an average of 1 billion barrels to its resource base. The 2007 success rate for exploration wells was 41 percent, comparable with Chevron’s average of 42 percent over the past six years. In addition, a recently released Wood MacKenzie report cited Chevron as the leader among its peers in exploration results from 2002 to 2006.

"Not only is our exploration success feeding our strong queue of major capital projects, it is also building the foundation for long-term reserves replacement as the discovered resources move to proved reserves" he said.

In regard to proved reserves, Kirkland said projects in Kazakhstan, Nigeria, Australia, Brazil, China, the United States and Angola will deliver strong reserves replacement for Chevron over the next three years.

"Our three-year business plan indicates we will have reserves of approximately 11.3 billion barrels of oil-equivalent at the end of 2010 – more proved reserves at the end of the decade than we have today" Kirkland explained.

ConocoPhillips, Houston Becky Johnson, 281-293-6743 (media) or Gary Russell, 212-207-1996 (investors) ConocoPhillips (NYSE:COP) held its annual analyst meeting today in New York. The company's Chairman and Chief Executive Officer Jim Mulva outlined how ConocoPhillips' strategic objectives and operating plans will enable the company to utilize its portfolio of high-quality assets in delivering growth and enhancing value for shareholders, while overcoming a variety of challenges inherent to the current business environment.

"We have a strong portfolio of opportunities, and development plans are under way so that we can fully capitalize on their potential," Mulva said. "We are benefiting from our talented work force and ongoing focus on capital discipline and project execution, financial optimization, operating excellence, and safety and environmental stewardship. As a result, we believe ConocoPhillips is well positioned to operate successfully in the business environment we foresee for 2008 and beyond - one that seems likely to be characterized by strong energy demand. Although we face intense competition for access to new resources and the prospect of legislation on climate change, we have taken steps to enable ConocoPhillips to operate effectively and deliver value as we manage the challenges ahead."

Mulva noted that ConocoPhillips' 2007 total shareholder return of 25.4 percent was above the peer group average, and that the company's three-, five- and 10-year returns led the peer group. He reaffirmed ConocoPhillips' intent to fund a capital program of $15.3 billion in 2008, to continue select asset sales that facilitate ongoing renewal of its portfolio, and to continue pursuing efficiency in executing its development projects, drilling programs and base operations.

In pointing out that efficiency, Mulva said, "In terms of cash contribution per barrel of oil equivalent, our performance leads our peers in both the E&P and R&M segments. This ability to generate cash enables us to enhance distributions to our shareholders, such as the recently announced 15 percent increase in our dividend, and it should enable us to complete the $10 billion in share repurchases authorized for 2008."

In its Exploration and Production (E&P) segment, the company outlined its strategic plans to advance an asset portfolio that is resource-rich, with more than 50 billion barrels of oil equivalent of existing resources, including 10.6 billion barrels of proved reserves at year-end 2007. ConocoPhillips has leading positions in both natural gas production and heavy-oil acreage in North America, a legacy asset position in the North Sea, and strong growth prospects in the Asia Pacific, Russia and Caspian, and Middle East regions. Major near- and long-term development projects are under way in all these regions. The company expects to sustain a long-term, average production growth rate of 2 percent and a five-year reserve replacement average of 100 percent or more. ConocoPhillips also anticipates new opportunities to emerge from its business development efforts and from a replenished exploration program that is increasing the company's exposure to high-potential prospects.

In Refining and Marketing (R&M), ConocoPhillips is committed to maintaining its segment-leading performance in U.S. refining, a strong refining position in Europe and an advantaged position in Asia. The company expects to sustain its leadership position by delivering safe, reliable and environmentally responsible operations, while holding base operating costs generally flat. ConocoPhillips also plans to capitalize on opportunities in the market by improving its clean products yields and enhancing the integration of its downstream, upstream and commercial businesses, while increasing operating margins through key investments in refining conversion capacity. In addition, the company is engaged with foreign partners in studying opportunities to expand its global portfolio.

Updates also were provided on the company's strategic partnership with LUKOIL, the upstream and downstream business ventures with EnCana Corporation, and the DCP Midstream and Chevron Phillips Chemical Company joint ventures.

In addition, Mulva addressed the important role technology would play in helping ConocoPhillips achieve its plans. "We have a rich history in technological development devoted to the recovery of conventional resources, and we believe that further research is the key to unlocking the value of our non-conventional resources and advancing the development of alternative energy sources."

The company expects to spend approximately $400 million on technology in 2008, primarily to progress such technologies as reservoir imaging, steam-assisted gravity drainage, coal gasification, carbon capture and sequestration, cellulosic ethanol conversion, and refining processes. This also includes more than $150 million for research efforts focused on the development of non-conventional oil and gas resources and the development of new energy sources, such as alternatives and renewables. Additionally, ConocoPhillips plans to build both a state-of-the-art global technology center and a best-in-class corporate learning center on land recently purchased in Colorado.

"Further, we are investing strongly in our people by enhancing our efforts to recruit, retain and develop a highly capable, demographically balanced and diverse work force," Mulva said. "We are making good progress, and our plans to develop both a technology center and a corporate learning center will help ensure our employees attain their maximum potential."

Discussing other issues, Mulva said that, "To ensure that our business remains sustainable over the long term, we must operate safely and with environmental care, while also helping address the key challenges facing society. For example, society clearly needs to achieve energy supply security, as well as address the challenge of climate change caused by carbon emissions. We believe these issues are interrelated and must be solved together. Therefore, ConocoPhillips supports enactment of a comprehensive U.S. energy policy, and a mandatory national framework to reduce carbon emissions. Also, we are working to conserve and recycle more of the water used in our operations, and are funding research into new techniques that could utilize the water produced in association with oil and natural gas for agricultural and industrial applications."

More information, including presentation materials and a recorded webcast of the meeting, is available at www.conocophillips.com/investor.

ConocoPhillips is an international, integrated energy company with interests around the world. For more information, go to www.conocophillips.com.

The government’s clarification in the Budget 2008 that ships hired to support drilling activities would indeed attract a 12.5% service tax, will make oil and gas exploration more expensive, given the unwillingness of explorers to pay the tax, forcing shipowners to take a hit to their financials by doing so themselves.
Exploration firms were brought under the purview of service tax in Budget 2007, but they have thus far refused to pay up arguing that the levy did not cover hiring of ships, as these were not involved in mining and drilling operations.
“To promote oil exploration activities along the county’s coast, the government introduced a special tax regime for this industry in the new exploration licensing policy, wherein it (the sector) is exempted from all duties and levies. Why should the government impose a service tax on us now?” asked an official with Oil and Natural Gas Corp. Ltd (ONGC), India’s biggest oil explorer. The official did not wish to be identified. ONGC has hired at least 100 offshore support and supply ships, paying anywhere between $2,000 (Rs81,000) and $12,000 a day to shipowners. Hiring of oil drilling rigs is costlier with daily rentals in excess of $200,000.
Both oil firms and local shipowners lobbied vigorously in the run-up to the Budget to exempt ship rentals to the offshore oil industry from service tax.
However, Budget 2008 clarified that renting ships such as drilling rigs, offshore support and supply vessels, anchor handling tugs and other supply boats would come under the scope of service tax.
Exploration companies are still resisting the tax. State-owned ONGC said it could not absorb the extra costs unless the government provides for it in the firm’s annual budget. “Oil exploration firms told us that service tax is not payable by them when we asked them to reimburse the levy on ship rentals for payment to the government,” said an official with Garware Offshore Services Ltd.
Shipowners could be in trouble as a result. The indirect nature of the tax means shipowners have to collect it from explorers and pay it to the government.
Recently, the Indian National Shipowners Association (Insa), the umbrella body representing local shipowners, received a communication from the government’s service tax department asking shipowners to pay the tax or risk action.
“We are in a jam. On one hand, we cannot violate government tax laws. On the other, we cannot give up on our clients,” said an executive with TAG Sealogistics Ltd who did not wish to be identified.
Shipowners such as Shipping Corp. of India Ltd, Great Eastern Shipping Co. Ltd, Varun Shipping Co. Ltd, Garware Offshore, TAG, Great Offshore and Dolphin Offshore Enterprises (India) Ltd will have to take a substantial hit if they are to pay the service tax from their own pockets. “It is a sizeable amount and will be a big problem for shipowners,” an Insa official who did not wish to be identified said.
The oil explorers’ stance contradicts a commitment by at least some of them to reimburse the service tax if it is made mandatory. “In fact, some shipowners had incorporated a clause in their contracts with ONGC that the company would reimburse service tax if it became payable,” said an executive with Great Offshore, India’s biggest offshore service provider.
“So, we are pretty much covered both contractually as well as due to the indirect nature of the tax, which is paid to the government only after it is collected from the end users,” added this executive who did not wish to be identified.

SHIPBUILDER Coastal Contracts Bhd expects to secure a further RM400mil worth of new offshore support vessels (OSV) orders this year, said executive chairman Ng Chin Heng.

“Apart from the RM105mil sale announced in January and the RM51mil deal announced last week, we are targeting to bag at least an additional RM400mil worth of new OSV orders to add to our already sizeable order book.

“We hope to achieve this before the end of 2008 to close the financial year at a high,” he told StarBiz.

Ng said the Sabah-based company was in “advanced negotiations” with several potential OSV buyers and was confident of closing these deals soon.

Coastal’s order book to build vessels had surpassed the RM1bil mark, he added.

In January, it announced that its wholly-owned subsidiary Coastal Offshore (Labuan) Pte Ltd had secured the sale of two OSVs to an Indonesia buyer for about RM105mil while last week it said it had secured the sale of two units of OSVs to an Egyptian buyer for RM51mil.

Ng said Coastal hoped to maintain a strong double-digit growth in net profit this year, with the OSV segment spearheading the earnings expansion.

At the same time, the company was positive that demand for tugboats and barges – its traditional vessels which are chartered out – would remain significant in line with the rise of global seaborne trade, he said.

Coastal’s vessels are used by agriculture, mining and heavy industry companies to transport grains, coal, iron ores, scrap irons, crude oil, crude palm oil and various other commodities.

“We are also considering the option of retaining a number of OSVs from our current building programme for outright charter to support vessel service providers.

“Alternatively, we can opt to assume the role of a support vessel service provider ourselves to get the ball rolling in this lucrative sector and bolster our recurring income,” Ng said.

He said that despite looming inflationary pressures, shipbuilders were still anticipating growth in orders of OSVs this year.

This is because demand is expected to trend up in line with robust activities in the oil and gas sector, which would drive demand for offshore exploration platforms and rigs. That, in turn, would generate demand for OSVs.

As for competition, although there have been several new entrants into the OSV market on the domestic front recently, Coastal does not expect congestion overnight in the sector.

“There will definitely be a gestation period of a few years between the development and preparation of new shipbuilding facilities and the actual roll-out of finished products,” Ng said.

Additionally, Coastal had moved up the shipbuilding hierarchy by fabricating “sophisticated” OSVs – a segment where barriers to entry were high, he said.

“We believe the pie is large enough to absorb additional OSV supply. Vietnam's oil industry, for example, is booming and that country is expected to have some 900 exploration wells over the next 15 years.

“Meanwhile, Petronas has targeted to explore and develop 500 new wells over the next five years,” Ng said.

Against this backdrop, surely the OSV demand and supply imbalance would continue, he added.

Coastal reported a 102% jump in net profit to RM69.3mil for the financial year ended Dec 31, 2007 while sales grew 82% to RM290.4mil.

Senator Dianne Feinstein said Sunday that the US troop surge in Iraq could fall short of its goal, and raised concerns about a news report that said stolen oil cash was paying for the insurgency.

"The surge, where it has worked militarily, has not worked politically. What's left in Iraq is a government that is incompetent," Feinstein, a Democrat who serves on the Senate Appropriations committee, told CNN.

Feinstein also pointed to a report in the New York Times that alleged that stolen Iraqi oil profits were paying for deadly insurgent activities five years after the US-led invasion.

"The front page of the New York Times points out massive, massive oil fraud. We had a hearing in defense appropriations, which dealt with some of it. The estimate is nine billion dollars of oil revenues are missing," she said.

"Now, the Times contends it's going in to fuel the insurgency. If this is allowed to happen, it doesn't matter what the surge does, the insurgency will continue."

The newspaper citing American military officials as saying fraudulent activities, including hijackings of oil tankers, bribed drivers, forged papers and manipulated meters are responsible for siphoning off about one-third of Iraqi oil revenue toward the black market.

"Some of the earnings go to insurgents who are still killing more than 100 Iraqis a week," the newspaper said.

The Times quoted Captain Joe DaSilva, a platoon commander at the Baiji oil refinery in a Sunni Arab-dominated region of Iraq, as saying such kinds of fraud were "the money pit of the insurgency."

The United States boosted troop levels to Iraq last year, sending in tens of thousands of extra soldiers. Its force in Iraq, which currently numbers 162,000, is supposed to fall to 140,000 by July.

Oil markets are rising due to speculation and the dollar's fall, not to a lack of petroleum production, OPEC President Chakib Khelil said on Sunday, the official Algerian news agency APS reported.

APS quoted Khelil, who is also Algerian Energy and Mines minister, as saying: "Prices are not going up because of a lack of output, but rather from the effect of speculation."

This increase in price "is linked not to a lack of production but to the devaluation of the dollar, which has given speculators the opportunity to invest in oil."

Victoria Petroleum as operator for the Growler Oilfield Development Project, advised that oil production has commenced from the Growler Oil Field. The start of production is significant as this is the first oil produced from PEL 104 located on the north western margin of the Cooper-Eromanga Basin. Both Growler wells were opened to natural flow on 12 March and were flowing at a combined rate of 100 BOPD. Artificial Lift production pumps will be installed over the next few days and once this work has been done the production rate is expected to reach 300 barrels of oil per day.

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British oil and gas firm Cairn Energy Plc has discovered new gas in one offshore well but has failed to find any in two other offshore fields in the Bangladesh sea, government officials said on Sunday.

The firm completed exploratory drilling in the Hatiya structure in the Bay of Bengal, 60 kilometers south of the port city of Chittagong, an official said.

"The firm informed us today that they have encountered hydrocarbon/petroleum in the structure which is not commercially viable," said Muhammad Muqtadir Ali, a director of state-run Bangladesh Oil, Gas, and Mineral Corporation or Petrobangla.

But Cairn has discovered new gas in a well at the Sangu offshore field.

"The firm will be able to add at least 25 to 30 mmcfd of gas in its total production," another official said.

Earlier, the firm did not find any commercially viable gas in Magnama, another offshore field in the sea.

"Now the firm proposed to conduct a 3D seismic survey in both the fields either in late December this year or early next year," Muqtadir told Reuters, referring to Hatiya and Magnama.

After the 3D survey is completed, Cairn will conduct an appraisal for a final decision which will cost altogether about $90 million for each field, the official said.

Muqtadir said the firm had already spent about $200 million in offshore exploration work.

The firm started drilling after completion of 2D seismic surveys but failed to discover commercially viable gas there.

Petrobangla, based on seismic surveys, has estimated that there was a potential reserve of 3.5 trillion cubic feet of gas at Magnama and 1.8 TCF at the Hatiya structure.

The firm operates Bangladesh's only offshore gas field at Sangu in the Bay of Bengal, producing up to 80 million cubic feet of gas per day .

Cairn has been in Bangladesh for more than 10 years and, along with its joint venture partner, U.S. firm Halliburton Co., has invested nearly $790 million, officials said.

Bangladesh's proven and recoverable gas reserves of 13.54 tcf are expected to be exhausted by 2011, officials said.

Sherman soon could be home to a highly efficient and clean 500-megawatt natural gas-fired electricity plant. Sherman Economic Development Corp. entered an agreement with Panda Energy Inc. Monday to build a $300 million, combined-cycle natural gas fired power plant.

Panda's is likely the largest building project in Grayson County history. In return for Panda's investment, SEDCO agreed Monday to give Panda 204 acres in its industrial park and $2 million in cash incentives. "We're just really excited about it," said SEDCO Board of Directors Chairman Joe Fallon. "They still have some financing and regulatory approvals to obtain, but it is really going to be great for the Sherman economy, mainly from the $300 million increase to the tax base ... From everything we're hearing and have looked at it's a very efficient, really clean-burning natural gas plant we're building."

Fallon said it is the largest building project they've found in Grayson County history.

SEDCO President John Boswell said the city of Sherman and Grayson County are still considering their economic development incentives for the plant. Such incentives from the county, Grayson County College and cities often come in the form of tax abatements. SEDCO acted quickly because it was important for Panda Energy Inc. to be able to go to the Electricity Reliability Council of Texas to begin discussions for building the plant, Boswell said. ERCOT controls the state's power grid. Panda also must gain permits to build and operate the plant from the Texas Commission on Environmental Quality.

Boswell said the SEDCO board approved giving Panda the land, which the company first will pay for and then SEDCO will reimburse; and $2 million based on the nearly $300 million investment. The incentives were based on investment and not the number or quality of jobs created. About 25 full time, permanent jobs should be created, Boswell said. The press release quotes Boswell as saying that building the plant will create 300-400 construction jobs and 32 jobs will be created indirectly supporting the plant.

The generating plant will be built in SEDCO's Northgate Park III industrial park, partially on 40 acres the board purchased in January for $400,000. Boswell said Panda will pay for the land and when the plant is built and the company receives a certificate of occupancy from the city, it will be reimbursed. The land, according to the land option contract between Panda and SEDCO, is valued at $3,600 per acre or $734,400. The park is west of U.S. Highway 75 and south of FM 1417. Part of the land is within Blalock Industrial Park.

A press release from Panda quotes Sherman Mayor Bill Magers as saying, "Panda representatives have been actively engaged with community leaders since the beginning of the site selection process. 'They've done a good job answering questions and building support for this project. Panda has also shown that they intend to be a good corporate citizen of our community.'"

Boswell said this is one of the best deals SEDCO has made, with incentives being less than 1 percent of the investment.

Panda officials said in a press release that the natural gas-fueled generating station would be able to supply the power needs of approximately 400,000 homes in North Texas and is expected to bring more than $248,000,000 into the area's economy over the next 10 years.

"The Panda Sherman generating station will utilize the latest in proven technology and will be one of the cleanest power plants in the nation," the press release states. "Air emissions at the facility will be controlled to among the very lowest of any power plant in Texas."

Combined cycle generating plants produce more energy than traditional plants do with a unit of fuel. The Northwest Power Planning Council explains that a combined-cycle gas turbine power plant consists of gas turbine generators equipped with heat recovery steam generators to capture heat from the gas turbine exhaust. This steam powers additional turbines that produce more electricity. Thus, what heat once was released back into the environment now is used to produce electricity.

This combined cycle produces power at about 50 percent of the chemical energy of the gas that powers it.

Combined cycle gas turbines emit nitrogen oxides, according to the NPPC and carbon monoxide. If fuels other than gas, such as fuel oil, were used, the plant might emit other chemicals, such as sulfur dioxide.

"In 2004, the company brought its development expertise to the biofuels industry originating several large-scale ethanol projects," Panda's press release states. "Newsweek Magazine subsequently recognized Panda, in 2005, as one of the ten most eco-friendly energy companies in America for developing the Hereford ethanol facility — the largest biomass-fueled ethanol refinery in the United States with one of the lowest carbon footprints of any similar-sized facility in the nation. In 2006, Panda Energy founded and transferred responsibility for its ethanol projects to Panda Ethanol, later establishing the company as a separate public entity."

Panda also owns combined-cycle natural gas fired generating plants in Paris, Odessa, Guadalupe, Oneta, Okla., Gila Bend, Ariz., El Dorado, Ark., Rosemary, N.C., and Brandywine, Md. The company owns a small hydroelectric plant in Bhoti Koshi, Nepal, and a coal-fired plant in Luannan, China. The Sherman plant would be one of its smaller natural gas plants. The company also owns natural gas and electricity distribution lines.

“Panda Energy is continuing its work to build out a fleet of new generating stations that will help meet the rising demand for clean, low-priced electric power,” said Robert Carter, chairman and chief executive officer of Panda Energy. “North Texas officials are clearly looking toward the needs of tomorrow, and we look forward to working with them to enhance the future reliability of the region’s power supply.”

Sherman Mayor Bill Magers said Panda representatives have been actively engaged with community leaders since the beginning of the site selection process. “They’ve done a good job answering questions and building support for this project. Panda has also shown that they intend to be a good corporate citizen of our community.”

“I can’t think of another company that has worked harder to bring something good to the city of Sherman than Panda Energy,” said John Boswell, president of the Sherman Economic Development Corporation. “This power plant will have a significant impact on the area’s economy for years to come. It will expand the tax base, enlarge payrolls and drive revenues for contractors, suppliers, engineering firms, hotels, restaurants, retailers and a host of other businesses. The plant will create an estimated 300-400 construction jobs, 25 direct jobs to run the facility and 32 indirect jobs to support it. This is good for the city of Sherman.”

The generating station will be located on a 200-acre site at the Progress Industrial Park. Construction will take approximately 24 months and is dependent upon financing, regulatory approvals and other conditions.

Panda Energy previously announced that it has filed for an air permit to build a 1,000-megawatt combined-cycle power plant in Temple, Texas.

Panda Energy was founded in 1982, has developed, financed, built and operated large-scale energy facilities both domestically and internationally. The company built the two largest gas-fueled, combined-cycle independent electric generation facilities in the United States totaling 4,500 megawatts of generating capacity. Altogether, the company has raised over $5.9 billion to develop and build more than 9,000 megawatts of generating capacity.

Newsweek Magazine, in 2005, recognized Panda as one of the 10 most ecofriendly energy companies in America for developing the Hereford ethanol facility — the largest biomass-fueled ethanol refinery in the United States with one of the lowest carbon footprints of any similar-sized facility in the nation. In 2006, Panda Energy founded and transferred responsibility for its ethanol projects to Panda Ethanol, later establishing the company as a separate public entity.

In import-based Hawaii, rising energy prices raise the price of everything else

It's easy to see the impact of record-high crude oil prices at the gas pump.

But what about other areas of the economy?

Anywhere you turn in Hawaii, it's hard to not notice the rising cost of everything from gasoline to groceries.

"You see it at the gas pump, and that's the wake-up call, but it also shows up in the processing costs for food and other manufactured items that are produced elsewhere, but that we then import," said Paul Brewbaker, chief economist for Bank of Hawaii.

Some increases are easily seen, such as fuel surcharges on airfares or shipping rates.

Other costs are less measurable, such as how meat prices are driven up due to higher feed prices as a result of ethanol demand, Brewbaker says.

"The inflation has been much higher than we thought in a particular commodity, petroleum, on which Hawaii is very much more dependent than the rest of the U.S. energy consumption complex," Brewbaker added. "That vulnerability weighs increasingly heavy on prospects for economic growth in the islands."

A continued rise in crude oil prices pushed pump prices in Texas to new record highs this week.

According to the AAA Texas, the current average price per gallon of self-serve unleaded gas in Texas rose to $3.16, an all-time high.

Fort Worth pushed past Dallas with the highest average in the state at $3.17 a gallon, up 9 cents from last week. Dallas' average also reached $3.17 a gallon, up 8 cents.

Elsewhere in the state, the average price in Houston hit $3.16 per gallon, up nearly 8 cents.

San Antonio had the state's lowest average at $3.12 a gallon, but that price was still up five cents over the previous week.

In Corpus Christi, the cost of gas increased nearly 6 cents -- to just under $3.14 per gallon.

"Every Texas region surveyed set new record highs this week, with Amarillo being the only exception," said AAA Texas spokeswoman Rose Rougeau.

The price in Amarillo reached $3.16, an increase of more than 5 cents compared with the previous week.

"Texarkana is the only area that posted a decrease," Rougeau said. "With record crude oil prices pushing retail gas prices upward, it is unlikely that area will continue to move downward."

The pump price was $3.13 a gallon in Texarkana, down more than 4 cents from the previous week.

The massive building squatting just off Harborside Drive is a 506-ton reminder of how the global quest for oil and natural gas is reviving island shipyards.

Building the structure, which will serve as living quarters for offshore workers, took 10 months and was the largest project to date for LoneStar Marine Shelters, 6800 Harborside Drive.

Last week, LoneStar Marine employees and about 150 energy industry representatives, including some from BP Energy and Fluor Corp., marked the completion of the 32-person sleeping quarters, control room and 69-foot-by-69-foot helideck with a tour and topping-out party.

Exmar Offshore, a subsidiary of an Antwerp, Belgium-based group of companies, contracted with LoneStar Marine to design and build the living quarters and a smaller workshop and storage building.

Marriage Made In Ingleside

The unit soon will be shipped by barge to the Kiewit Offshore Services yard in Ingleside, north of Corpus Christi, and be married to Exmar’s $300 million Opti-Ex deepwater semisubmersible production platform. Samsung Heavy Industries in South Korea is building Opti-Ex’s hull. Workers at Kiewit’s fabrication yard will complete the rig’s 6,400-ton deck.

The living unit includes a galley, gymnasium, sick bay, offices and rooms equipped with 15-inch plasma TVs and a lounge with a 42-inch screen TV. It’s all wired for Internet.

Monster Move

Perhaps as soon as the end of this month, the structure will be rolled onto a barge at the shipyard’s dock by a remote-controlled mover equipped with 280 independently operated wheels, LoneStar officials say.

The mover will lower the unit down onto a structure engineered to distribute its enormous weight across the barge, officials said.

Finally, workers will brace and weld the building to the support structure on the barge for the trip through the Gulf of Mexico to Ingleside.

Exmar’s Opti-Ex, which can operate in depths of 10,000 feet, is the only new production semisubmersible under construction that’s available for lease, officials say. The platform is expected to be delivered in the first quarter next year and will be available for lease to oil companies worldwide, Exmar officials say.

Opti-Ex is capable of supporting production of 60,000 barrels of oil and 50 million cubic feet of natural gas a day, Exmar officials say.

Record Demand

Record high oil prices — light, sweet crude for April delivery reached a new trading record of $110.20 Wednesday— is driving demand for buildings to accommodate offshore workers.

Strong energy prices bode well for the island yard, said Steve Vacker, vice president of LoneStar Marine Shelters.

“For our business, it means there’s more out there to invest in the search for oil,” Vacker said. “Companies are more likely to go out farther to drill in deeper water.”

Vacker declined to say what the Exmar contract was worth to LoneStar Marine.

The company arrived in Galveston in 2003, taking over a repair yard that had been idled by First Wave Marine/Newpark Shipbuilding a few years before when island shipyards were struggling.

LoneStar Marine, which previously had a landlocked Houston site, moved to the island specifically to take on bigger projects such as the one it just completed, officials said. Being near water allows it to put projects directly on barges, officials said.

LoneStar Marine, with more than 100 employees, owns 85,000 square feet of warehouse and office space on 28 acres just north of Harborside Drive.

Industry Energized

Booming energy and marine industries have created between 400 and 500 full-time jobs on the island in the past 12 months, said Jeff Sjostrom, president of the Galveston Economic Development Partnership.

Last month, Rolls-Royce Commercial Marine broke ground on a 50,000-square-foot facility on Pelican Island, where it will overhaul propulsion equipment used by the offshore and marine industries. Eventually, Rolls-Royce could employ about 100 people, officials have said.

Rolls-Royce is subleasing space from Gulf Copper Dry Dock and Rig Repair, which in 2005 revived a shipyard on 110 acres. Including contractors, Gulf Copper employs about 1,000 people.

Sjostrum said the partnership has taken notice of the energy-driven growth and has revived a task force to attract more offshore and maritime industry to the island. Jayson Levy, a former chairman of the partnership, is heading up the task force.

Sjostrum likens growth of offshore support services on the island to the residential development boom.

“It’s just amazing,” he said.

Crude oil prices have touched $110 per barrel in international market. India's public sector marketing companies have to face losses in this connection. It is noticeable that at present we have to import more than 75 per cent crude oil for our energy requirements. The coming years could see this requirement touching 90 per cent. The reason behind this is not lowering of prices of crude oil and continuous demand of energy in China, India and other developing countries.

In such countries the governments give subsidy on petro products, due to which its demand does not come down even when the price of crude oil goes up. The Organisation of Oil Exporting Countries (OPEC) has decided not to increase production of crude oil, even if its price keeps on rising. With the value of the dollar against the Euro falling and continuous concern over its supply has also led to unexpected hike of crude oil price.

Taxes are already high in India and the government has come out with ways to solve this problem by issuing oil bonds to meet losses. However, it is not necessary that a permanent solution may be arrived at this way. The government is the biggest consumer of oil in India. Other sectors come after it. First of all, it is necessary that the consumption of oil should be decreased. Efforts should also be made for saving oil. Use of private vehicles should be controlled and the traffic should be made easier and public transport should be made popular.

Buses and car pool system should be developed to carry employees/officials to and fro from office. Rationing system could also be followed. OPEC should also take steps to control oil prices in international market. In the present circumstances saving of oil should be enforced. Research for alternative fuel should be carried out.

The good news for Missouri motorists: Gasoline prices here are the second-lowest in the nation.

The bad news: They're still high, and it's going to get worse once the summer travel season rolls around.

AAA Auto Club's online Fuel Gauge Report shows the average price of a gallon of regular unleaded was at $3.25 nationally on Wednesday. The Missouri average was $3.04. Only New Jersey, at $3.02, was lower.

But Mike Right of AAA's St. Louis office said the survey was taken before St. Louis-area stations saw a significant Wednesday spike of about 11 cents per gallon, to $3.10. AAA's survey around Missouri showed most towns had prices above $3 per gallon.

It's still a bargain by comparison. The average price in the state of Washington was $3.50. It was $3.59 in California. Even in states neighboring Missouri, prices were sharply higher, most markedly in Illinois, with an average price of $3.31. Kansas was at $3.17, Arkansas at $3.16, Iowa at $3.18.

''I guess that's some consolation anyway,'' Right said.

Ron Leone, director of the Missouri Petroleum Marketers & Convenience Store Association, said individual service station owners can do little to offset the price.

''Three main factors make up 90 to 95 percent of the cost: Crude oil, refining and state and federal taxes,'' Leone said. ''Right now you're seeing the cost of crude as the biggest reason prices are rising.''

The price of crude oil has escalated to around $109 per barrel. Right noted that a year ago, a barrel of crude oil was about $58. At this time last year, Missourians were paying $2.39 per gallon. As recently as a month ago, the average price in the state was $2.80, according to AAA's Web site.

Eric Wittenauer, energy futures analyst for Wachovia, said gasoline prices would be even higher if not for flat demand.

''That's reflective of the cyclical downturn in the economy, and consumers changing their driving patterns and behavior,'' Wittenauer said. ''Public rider transportation is at all-time highs. Prius outsold Ford Explorer last year. That's indicative of the shift in behavior from consumers.''

Right also believes that people are driving less, a trend that could continue through the summer travel season.

''Last year we noticed decreases in the vehicle miles per travel,'' he said. ''I think people are indeed trying to reduce their consumption.''

Still, both Right and Wittenauer expect gasoline prices to go even higher as the warmer weather arrives and demand increases as people go on trips. The highest-ever gasoline costs in Missouri were reached last May when prices spiked as high as $3.30 per gallon in Kansas City and St. Joseph.

Right expects that record to be topped, probably this May, but neither he nor Wittenauer expects to see $4 per gallon - at least not in Missouri.

''Inventories remain high in terms of gasoline stockpiles and demand numbers are weak,'' Wittenauer said. ''I do not look for prices to get to $4 per gallon (in Missouri), but certainly in other parts of the country.''

Diesel prices may get there, though, a huge burden for truckers and others. The average price for a gallon of diesel on Wednesday was at an all-time high of $3.71 in Missouri. A month ago, the price was $3.19 and a year ago, $2.60.

Wittenauer said diesel fuel supplies are tighter than those for gasoline and he expects prices to continue to rise.

Oil fell by around a dollar as end of week profit-taking and concerns over the health of crude's recent rally knocked the top off yesterday's record price.

At 4.00 pm, New York's WTI crude for April delivery was down 87 cents at 109.46 usd per barrel, having yesterday traded to a new all-time high of 111.00 usd.

In London, Brent crude for April delivery was down 84 cents at 106.70 usd per barrel, having yesterday touched 107.88 usd, its highest ever price.

Crude prices have spiked to a series of record highs in recent sessions, as investors poured into oil in a bid to guard against historic dollar weakness. But with the US economy possibly already in recession, and economic fears heightened today by news Bear Stearns has had to seek emergency funding, crude's recent gains appear to be detached from market fundamentals.

A US recession should see demand growth slow, while rising crude inventories point to decent supplies heading into the second quarter, when crude usage is generally at its lowest.

"Oil prices are treading in dangerous territory as oil and gasoline are being played more as a hedge against the dollar and has little regard for supply and demand," said Alaron trader Phil Flynn in Chicago.

But while prices have eased today, few investors are confident of calling a top on the market, despite an unsupportive fundamental backdrop. The dollar has tanked to another record low against the euro, possibly encouraging more hedging activity in crude next week, while also making prices cheaper for overseas investors.

MF Global analyst Ed Meir said: "With the sinking dollar providing support, the path of least resistance seems to be higher still," though he warned that markets could be dangerously overbought, with the risk of a sharp decline in prices not to be ruled out.

OPEC, the producer's cartel responsible for some 40 pct of global oil supplies, today revised its monthly estimation for US economic growth down, but kept its oil demand figures largely unchanged at 87 mln bpd for 2008.

Last week, the group decided to hold production quotas steady, despite pressure from the US to increase output to help cool record prices.

While OPEC is not due to meet again until September, the cartel said it would, "continue to closely monitor ongoing market developments and as always stand ready to take the necessary measures in line with their commitment to market stability and ensuring adequate supplies."

OPEC has consistently blamed recent price gains on market speculation, geopolitical tensions, and the weakening dollar, rather than a lack of supplies in the market.

Some have explained the recent record highs seen in oil and other commodity markets, set against the backdrop of an economic slowdown, as indicative of a broader trend.

Goldman Sachs analysts have argued that booming demand from developing nations, increased resource nationalism, and decades of underinvestment in commodities has created an environment where prices can continue to rise despite a slowing economy.

"The most recent rise in commodity prices is simply the extension of the structural bull rally in commodities that is now in its ninth year, and the fact that the rally continues in the midst of an economic slowdown simply serves to highlight the fact that this bull rally is structural, not cyclical," analysts at Goldman's said, warning that prices will probably remain at higher levels until significant investment increases production capacity to a level capable of meeting future demand projections.

"Solving the politically driven supply constraints will be a very difficult and protracted process which will likely lead to explosive prices in the next couple of years, with oil prices potentially spiking toward 175 usd a barrel, particularly should growth in the G7 re-accelerate in 2009 and beyond."

Goldman Sachs was one of the first investment banks to predict oil prices at 100 usd a barrel. They recently increased their 2008 average price forecast to 105 usd a barrel.

Public sector oil companies would invest Rs 229,071.5 crore in oil and gas exploration, fuel retailing, refineries and petrochemicals, during the 11th Plan Period (2007-2012).

In a written reply in Lok Sabha, minister of state for petroleum and natural gas, Dinsha Patel, said Rs 150,932.49 crore would be spent on oil and gas exploration in India and abroad, Rs 62,582.10 crore on refining and marketing and Rs 15,321 crore on petrochemical business.

Oil and Natural Gas Corp (ONGC) will invest Rs 75,983.77 crore in domestic E&P while its subsidiary ONGC Videsh Ltd has budgeted Rs 45,332.87 crore in overseas oil and gas hunt. Oil India Ltd has earmarked Rs 13,439.02 crore and GAIL India Rs 10,326.83 crore, the minister said.

Indian Oil Corp has planned an investment of Rs 28,567.75 crore in refining and marketing in 2007-12, Bharat Petroleum Rs 11,344.80 crore and Hindustan Petroleum Rs 8,714 crore. IOC also plans to invest an additional Rs 11,844.10 crore in petrochemical plans while GAIL has projected Rs 1,618 crore.

To a separate question, Patel said IOC, BPCL and HPCL plan to set up 1,830 new petrol stations in 2008-09.

Of these, IOC would set up 930, HPCL 498 and BPCL 380. He said oil retailers are at present operating 306 auto LPG dispensing stations in the country. They would add another 158 next year.

"Auto LPG sale during April-January was 170,000 tons as against 108,000 tons during the corresponding period of last year, showing a growth rate of 57.4%," he said.

The government, he said, has not given approval for use of domestic LPG in vehicles. As per the auto-LPG Control Order, only imported or import-substituted auto LPG can be used in vehicles.

Financial stocks led the way down on stock markets late Friday morning after JPMorgan chase and the Federal Reserve Bank of New York moved to provide temporary funding for investment bank rival Bear Stearns.

The funding will be provided as necessary for up to 28 days. During that time, JPMorgan Chase will also help Bear Stearns find permanent financing.
Bear Stearns says its liquidity significantly deteriorated over the past day and the temporary funding will help it continue operating normally. Its stock fell 42 per cent.

"We're moving into the phase where the reality of trying to stay afloat while your business is crippled is going to start to bury companies," said Paul Thornton at Northern Securities.

"You're going to see the obvious sectors continue to be weak because of this kind of thing. It's the old cockroach theory which is not new at this point - if one company is going to go under you know more of them are coming."

The Bear Stearns news overshadowed tame inflation data from the U.S. that reassured investors that the U.S. Federal Reserve can put price pressure worries on the back burner and continue to cut interest rates aggressively to hopefully help the economy through an economic slowdown.

The TSX Venture Exchange declined 15.64 points to 1,665.03 while the Canadian dollar moved down 0.3 cent to 101.16 cents US.

On the economic front, Statistics Canada reported that Canada's labour productivity fell for the first time in more than a year in the fourth quarter as GDP growth slowed, while hours worked continued to increase steadily. Productivity lost 0.8 per cent, after posting a slight 0.1 increase in each of the previous two quarters.
New York's Dow Jones industrials tumbled 124.23 points to 12,021.51.

The U.S. Labour Department reported that consumer prices were unchanged last month, a much better performance than the 0.3 per cent gain that had been expected.
Core inflation, which excludes energy and food, was also well-behaved, with an unchanged reading in February following a 0.3 per cent jump in January.

This was particularly welcome news coming ahead of Tuesday's scheduled announcement by the Fed on interest rates.

Investors are hoping for a cut of at least three quarters of a point.
"The report provides some tentative evidence that the weakening in economic activity is contributing to containing inflationary pressures emanating from rising energy and non-energy commodity prices," said RBC assistant chief economist Paul Ferley.
"This will allow policy to remain focused on limiting the extent of any slowing in growth from the ongoing housing market meltdown and credit tightening."

The TSX financial sector dropped 2.5 per cent on the Bear Stearns news as Royal Bank (TSX:RY) gave back $1.28 to $46.07 and Bank of Montreal (TSX:BMO) stepped back $1.18 to C$40.27.

Oil prices were off after running ahead to yet another record high close. The April crude contract on the New York Mercantile Exchange lost 58 cents to US$109.75 a barrel. The TSX energy sector fell 1.2 per cent with Suncor Energy (TSX:SU) down $2.84 to C$104.22 and Canadian Natural Resources (TSX:CNQ) retreated $2.72 to $104.34.

Gold prices were up, rising above US$1,000 an ounce for a second day. The April bullion contract moved up $12 to US$1,005.80 an ounce. The gold sector was up 2.3 per cent with Barrick Gold Corp. (TSX:ABX) ahead $1.76 to $53.95.

Major fertilizer supplier Agrium Inc. (TSX:AGU) has extended the deadline for UAP Holding Corp. (NASDAQ:UAPH) shareholders to tender shares to its US$2.45-billion bid until April 30.

The offer was set to expire Friday at midnight, but has been extended because all of the completion conditions have not yet been satisfied. Agrium shares declined 57 cents to $70.37.

Shares in giant-screen movie company Imax Corp. (TSX:IMX) were down 19 cents to $6.41 after its fourth-quarter loss widened to US$10.1 million from a year-ago $9.2 million as the company booked a $4-million writedown on its film-related inventories.
WestJet Airlines Ltd. (TSX:WJA) shares moved up 27 cents to $18.33 after it said Thursday it has received regulatory approval to buy back up to 2.5 million of its shares from the Toronto Stock Exchange.

Major European indexes also turned lower as France's CAC 40 gave back 52.22 points to 4,577.97, Germany's DAX down 70.37 points at 6,430.19 and the London-based FTSE 100 down 55 points at 5,637.4.

Tokyo's benchmark Nikkei 225 stock index fell 1.5 per cent, to 12,241.60, dropping to its lowest close since August 2005.

Hong Kong's Hang Seng Index extended its losses as well, dropping 0.3 per cent to 22,237.11 after plunging nearly five per cent in the previous session.

Spot gold jumped to a record high above $1,000 an ounce on Friday as a tumbling dollar and an escalating financial crisis triggered a surge in investment demand looking for safety in hard assets.

Crude oil came within a whisker of all-time peaks, while industrial metals and soft commodities were also strong.

Spot gold rose to a session high of $1007.10 a troy ounce. It was up at $1002.30/1003.00 by 1521 GMT from $991.00/991.80 on Thursday.

The latest spurt of buying came after shares in U.S. investment bank Bear Stearns plunged by 50 percent on news that the bank's liquidity position had deteriorated significantly over the last 24 hours.

Fears that this could be the beginning of another tranche of bad news in the financial sector pushed the dollar to record lows against the euro.
"As long as credit problems persist, primarily in the United States, but elsewhere as well, then we will see this tendency for people to move towards real assets," said Stephen Cohen, managing director at Troika Dialog UK.

Gold is used as a hedge against financial market turbulence. It has risen by more than 50 percent since the credit crisis exploded last August.
"Financial sector firms have been hit hard ... Some are trading below book value," said James Fenkner, a fund manager at Red Star. "It gives you a sense of the negative sentiment."

Worries about rising inflationary pressure this year have also given the precious metal a boost.

LAGS AND LAPSES

A falling dollar makes commodities denominated in the U.S. currency cheaper for holders based outside the United States. This is one of the reasons cited for crude oil's climb to an all-time high of $111 a barrel on Thursday.
Crude has gained despite the growing chances of recession in the United States, the world's largest consumer of oil, and the likelihood of lower demand.
But fund managers believe a major reason behind oil's climb over the last few years has been the realisation that shortages over coming years will be a major feature of the market.

"Many major commodity producers whether it be oil companies considering exploration projects or mining companies considering new mines, have in many cases been slow to assume higher prices are here to stay," Cohen said.
"They have not rushed into new project to increase capacity. There are signs this is changing, but there is a big lag between an investment decision and provision of extra capacity."

Copper rose to $8,545 a tonne, less than $300 from the record high of $8,820 seen last week.

The metal used widely in the power and construction industries was also boosted by falling stocks of the metal in London Metal Exchange warehouses, down by more than 35 percent since the beginning of this year.

"The seeming paradox of rising commodity prices in the midst of an economic slowdown has been a source of concern for many," Goldman Sachs said in a note.

"The fact that the rally continues in the midst of an economic slowdown simply serves to highlight the fact that this bull rally is structural, not cyclical."

Cocoa futures in London rose to a new 5-1/2-year high of 1,567 pounds, reinforced by a dock workers strike in the Ivory coast, the world's top cocoa producer.
London robusta coffee and white sugar futures were firm below their recent 12-1/2-year and 15-month peaks respectively.

Berry Petroleum said on Thursday that it is one of two companies being investigated by the state for sizable recent spills from oil and gas operations into a gulch feeding into Parachute Creek.

Berry joins Marathon Oil Co. in stepping forward to say they experienced spills from reserve pits in the Garden Gulch area near Parachute. However, like Marathon, Berry says its spill involved only water.

Berry said the spill totaled 2,500 barrels and that a nearby spring contributed to it. But the company said trace amounts of drilling additives were found below the pit.

Last week, the Colorado Oil and Gas Conservation Commission announced it was investigating what it called four major spills by two companies in the Garden Gulch area from November through February. It has refused to identify the companies because the investigation is ongoing.

Marathon later announced it learned Jan. 31 that 30,000 barrels, or 1.2 million gallons, of water had leaked from one of its reserve pits.

The commission’s statement last week said one of the spills consisted of 30,000 barrels of drilling mud.

Deb Frazier, spokeswoman for the Colorado Department of Natural Resources, has said drilling mud can contain a variety of things, and the state is still working to determine the contents of the four spills it announced. She would not confirm that the Marathon spill was the same 30,000-barrel spill referred to in the oil and gas commission statement.

Last week’s statement indicated that the company responsible for the 30,000-barrel spill was not involved in the others. Marathon has said it was responsible for only one of the Garden Gulch spills.

The state has said a second company didn’t report two of its three spills immediately, in violation of commission requirements.

Berry’s statement Thursday referred to only one spill, consisting of 2,500 barrels. It said that during drilling, it saw fluid flowing away from a well pad, and an investigation showed two possible sources — a spring or the reserve pit. The reserve pit ultimately was determined to be contributing to the flow.

“While no drilling muds were placed into the pit or released into the environment, trace amounts of other drilling additives were identified downgradient from the pit. These concentrations were below drinking water standards,” Berry said in its statement.

Berry spokesman Todd Crabtree said Berry has met with oil and gas commissioners and will fully cooperate in the matter.

“We recognize the need to promptly report all releases from well sites,” he added.

He said he didn’t know what the commission is referring to in its mention of releases that weren’t reported immediately, and Berry isn’t acknowledging any failure to make immediate reports.

He said he didn’t know the timing of the report for its spill, but that there’s no indication it wasn’t immediate. Crabtree also said he didn’t know whether the company was involved in multiple spills in the area.

Independent energy company Edge Petroleum Corp. said Thursday it swung to a fourth-quarter loss, hurt by the commodity price volatility and higher costs.

The company posted a loss of $6.4 million, or 22 cents per share, compared with a year-ago profit of $2.9 million, or 16 cents per share.

Revenue jumped 44 percent to $35.9 million, from $24.9 million in the year-ago quarter. Sales were boosted by increased production, the company said. Production rose to 5.8 billions of cubic feet equivalent, from 4 billions of cubic feet equivalent a year earlier.

Analysts were expecting a profit of 7 cents per share on revenue of $43.6 million, according to a poll by Thomson Financial.

"The volatility in commodity prices, particularly for oil, continues to have a major impact on our reported earnings as a result of mark-to-market accounting which we follow," Executive Vice President and Chief Financial Officer Michael G. Long said in a statement.

When a company marks to market, they adjust the value of assets on their books to reflect current market conditions.

The company said it was also weighed down on costs from increased staff, higher rent, and professional service fees.

For the full year, the company posted a loss of $1 million, or 4 cents per share, compared with a loss of $41.3 million, or $2.38 per share, in 2006.

Revenue rose 24 percent to $160.9 million.

Edge said it's continuing its review of strategic alternatives, noting it's "working quickly" toward a potential merger or sale.

Central Petroleum provided a 140308 exploration update, reporting access roads have been constructed to both the Blamore and Simpson well locations with the road building crew reaching Simpson this morning; underdale water well drillers have been mobilised and are expected to be on site by the coming 17 March with first water by the following 21 March. The water is necessary to complete the access road for the drilling rig; and an onsite-while-drilling inspection of Hunt Rig #2 has been completed by the Company's GM Drilling, Operations and Production, Randy Frazier and it has been deemed fit for purpose with the final detailed drilling contract to be executed shortly.

More information about CTP.AX

Pilgrim Petroleum Corporation announces increased production of an average of approximately 10% over the last month, after rework of two additional re-activated wells. In addition it has begun the process of interviewing qualified geology and engineer firms for its additional reserve evaluation estimates; the additional work is for the new properties unaccounted from the last reserve report. Pilgrim continues to complete the design for extensive 9 wells on the Archer County area for July 2008.

Pilgrim Petroleum Corporation Vice President of Operations Jerry Schilling said, "Pilgrim's Reactivation Program has shown significant progress since its implementation; operations will continue to bring back more inactive wells into production and optimize our existent oil & gas production through reduced production cost, improved production rates and increased ultimate recovery."

About Pilgrim Petroleum Corporation

Headquartered in Dallas, Texas, Pilgrim Petroleum Corporation is a publicly traded company (PGPM). The company is acquiring oil and gas leases, producing properties, mineral rights and surface interest's primary on marginal fields. Once acquired, the company intends to develop each property to maximize the income from each by refurbishing and improving the existing production.

Forward-Looking Statements: The statements which are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties, including but not limited to, the effect of economic conditions, the impact of competition, the results of financing efforts, changes in consumers' preferences and trends. The words "estimate," "possible," and "seeking" and similar expressions identify forward-looking statements, which speak only to the date the statement was made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, because of new information, future events, or otherwise. Future events and actual results may differ materially from those set forth herein, contemplated by, or underlying the forward looking statements.

2008 Pilgrim Petroleum Corporation. The information herein is subject to change without notice. Pilgrim Petroleum Corporation shall not be liable for technical or editorial errors or omissions contained herein.

Independent exploration and production firm Anadarko Petroleum has named Robert Gwin as the senior vice president of the organization.

Mr Gwin has more than 20 years of experience in corporate finance and executive management. He joined Anadarko in January 2006 as vice president for finance and treasurer.

In his new position, he will join the company's executive management committee and will assume oversight of the company's human resources functions.

In addition, he will continue to serve as the president and CEO of Western Gas Holdings, which is the general partner of Western Gas Partners.

A vice president of oil and natural gas producer Parallel Petroleum Corp. sold 30,000 shares of common stock, according to a Securities and Exchange Commission filing Wednesday.

In a Form 4 filed with the SEC, John S. Rutherford reported selling the shares on Tuesday for $17.50 apiece.

Insiders file Form 4s with the SEC to report transactions in their companies' shares. Open market purchases and sales must be reported within two business days of the transaction.

Parallel Petroleum is based in Midland, Texas.

Crude oil dropped from a record on concern that prices have risen too high, too fast at a time of rising inventories and expectations energy demand may weaken in the U.S.

Oil futures fell today, following a report this week that showed U.S. crude inventories rose more than analysts forecast. Prices had gained 26 percent since Feb. 6, sparked by declines in the dollar's value against the euro and the yen.

``The market is overbought and it is not related to the real fundamentals anymore,'' said Andy Sommer, an analyst with HSH Nordbank in Hamburg. ``The weak dollar has been driving the market in the last couple of weeks.''

Crude oil for April delivery fell as much as 94 cents, or 0.9 percent, to $109.39 a barrel in electronic trading on the New York Mercantile Exchange. It was at $109.66 at 12:55 p.m. London time.

Futures yesterday settled at a record $110.33 a barrel after reaching $111, the highest since trading began in 1983. The dollar yesterday fell below 100 yen for the first time since 1995 and dropped to an all-time low against the euro. The tumbling dollar draws investors to oil as commodities become cheaper for buyers using other currencies.

New York crude's relative strength index, a measure of how rapidly prices have advanced or dropped during the past 14 days, was at 72.9 today. Readings above 70 indicate a price may be poised to fall, and readings below 30 indicate it may be poised to rise.

Brent crude for April settlement fell as much as 90 cents, or 0.8 percent, to $106.64 a barrel on London's ICE Futures Europe exchange. It was at $107.7 at 12:56 a.m. London time. Brent yesterday closed at an all-time high of $107.54 a barrel after reaching an intraday record of $107.88.

Brent Expiry

The April Brent contract expires today. The more-active May contract was down 41 cents at $106.00 a barrel.

U.S. crude oil stockpiles climbed 6.18 million barrels last week to 311.6 million barrels, a U.S. government report showed this week, versus an average analyst forecast of 1.68 million barrels. Rising inventories has increased speculation that demand for fuel is falling in the U.S. as the economy slows.

``The dollar dominates everything right now,'' said Andrey Kryuchenkov, an analyst at Sucden (U.K.) Ltd. in London. ``When we had very bearish stocks from the Energy Information Department, within one hour the price had come back again.''

The dollar dropped as low as $1.5651 per euro earlier today, the weakest since the European currency's debut in 1999. It was last at $1.5579 per euro.

``Slowing U.S. growth will dampen demand for energy from the world's largest oil consumer,'' said Sucden's Kryuchenkov. ``This will put some pressure on oil prices.''

Gasoline Demand

U.S. gasoline demand increased by about 0.7 percent, or 60,000 barrels a day, last week, according to data from the Department of Energy. Demand remained below levels recorded at the same time last year.

Sixteen of 37 analysts surveyed by Bloomberg News, or 43 percent, said prices will drop next week. Thirteen of the respondents said oil will rise and eight forecast little change. Last week, 45 percent said oil would decline.

OPEC cut its production forecast for countries that are not members of the organization, citing lower output from Western Europe, North America and Mexico.

Non-OPEC production will run at a rate of 50.37 million barrels a day this year, the Organization of Petroleum Exporting Countries said today in a monthly report, cutting its previous projection by 160,000 barrels a day. OPEC left its world demand forecast little changed.

Investors are buying oil to ``hedge against inflation and the declining value of the U.S. dollar,'' OPEC said. ``While financial markets dynamics lifted prices to record level, fundamentals indicate a market which is currently well balanced and expected to soften over the comings months.''

Global commodities markets were bubbling on Friday after gold briefly peaked at over 1,000 dollars an ounce, oil hit new highs and the dollar tumbled.

Hong Kong gold prices edged close to the symbolic 1,000 US dollars an ounce mark that was breached for the first time Thursday on the London Bullion Market.

The plunging dollar and the precious metal's traditional role as a safe haven amid fears of rising inflation have caused gold prices to surge about 17 percent so far this year.

Investors are funnelling cash into commodities generally as they seek a refuge from volatile world stock markets and growing fears of a US-led economic slowdown, traders said.

On Friday Hong Kong gold prices were markedly higher at 997.20-997.70 US dollars an ounce in afternoon trading, up from Thursday's close of 987.10-987.60 dollars.

Oil simmered down on Friday after hitting a record 111.00 dollars per barrel the previous day, but analysts said prices remained on the boil due to the ailing greenback.

New York's main oil futures contract, light sweet crude for delivery in April, was at 109.78 dollars per barrel in Asian trade, down 55 cents from its all-time closing high of 110.33 dollars in New York.

In earlier frenzied US trading, the contract had struck 111.00 dollars for the first time.

"We are seeing only a marginal movement," said David Moore, a commodity strategist with the Commonwealth Bank of Australia in Sydney, noting that prices remained high.

The dollar fell below the key 100-yen level Friday for the second day in a row, flirting with fresh 12-year lows amid mounting fears of a US recession.

The dollar dropped to as low as 99.83 yen in Asian trade, approaching Thursday's trough of 99.78, which was the weakest since November 1995.

It recovered slightly to stand at 100.15 in late Tokyo trade, down from 100.60 in New York on Thursday.

"Resistance to a falling dollar has evaporated as the market is unable to see a drastic improvement" in the subprime crisis, said Saburo Matsumoto, chief forex strategist at Sumitomo Trust Bank.

The euro firmed to 1.5640 dollars in Tokyo from 1.5624 in New York, close to its all-time high of 1.5645.

Many analysts now expect the US Federal Reserve to cut its key lending rate by as much as three-quarters of a point next week. Investors generally prefer the currencies of countries that have higher interest rates as they can reap better yields.

In Washington, US Treasury Secretary Henry Paulson insisted Thursday that a strong dollar "is in our nation's interest" and said he would like to see the currency strengthen.

Paulson acknowledged the US economy was suffering but said: "Our economy, like any other, has got its ups and downs but the long-term fundamentals are strong and I believe it's going to be reflected in the currency market."

In Asian markets on Friday, Hong Kong's Hang Seng Index ended the morning session down 0.67 percent after an early rebound faded, while Japanese shares closed down 1.54 percent at the lowest level for two years and seven months.

Oil prices retreated Friday after jumping as high as a record $111 a barrel in the previous session as investors fled the declining dollar in search of a haven in commodities.

Analysts said the decline reflected the volatility that has characterized crude futures trading in recent weeks.

"When there are no immediate supply side concerns that justify surging to new record everyday, some pullback is inevitable," said Victor Shum, an energy analyst with Purvin & Gertz in Singapore. "This is just part of the volatility of trading."

Light, sweet crude for April delivery on the New York Mercantile Exchange dropped 29 cents to $110.04 a barrel in electronic trading by midday in Europe.

In London, Brent crude futures lost $1.34 to $106.20 a barrel on the ICE Futures exchange.

Shum said the expiration of options on the April Nymex crude contract on Friday added to the volatility of trading.

The contract surged Thursday to an all-time trading high of $111 before settling at a record close of $110.33 a barrel, up 41 cents from the previous session.

Crude has risen to records in 12 of the last 13 trading sessions. Analysts blame oil's ascent on the weak dollar, which dropped to yet another low against the euro Thursday.

Crude futures and other commodities offer a hedge against a falling dollar; as well, oil futures bought and sold in dollars are more attractive to foreign investors when the dollar is weak.

Interest rate cuts further weaken the dollar and have helped drive oil's rise, and another reduction in U.S. benchmark lending rates is expected at the Federal Reserve's regularly scheduled monetary policy meeting next Tuesday.

"The dollar traders will be watching the release later (Friday) of the U.S. inflation number for February as an indicator of the Fed decision next Tuesday," said Olivier Jakob, of Petromatrix in Switzerland. "What central banks decide next Tuesday should be more relevant to oil prices than any recent OPEC meetings."

Analysts said the U.S. Commerce Department's report Thursday that retail sales fell in February raised new worries that the economy is headed for a recession that would curtail demand for oil. But analysts expect any oil price weakness to be short-lived.

"In the near term, despite the fact that oil pricing is pulling farther from market fundamentals, this bull run could continue because of the expectation of further (Fed) interest rate cuts and continued weakening of the U.S. dollar," Shum said.

In other Nymex trading, heating oil futures dropped 0.39 cent to $3.1209 a gallon while gasoline prices fell 1.23 cents to $2.6705 a gallon.

Natural gas futures fell 1.6 cents to $10.214 per 1,000 cubic feet.

Pity Dick Cheney, when Air Force Two lifts off on Sunday for the Middle East. Reviving the Israeli-Palestinian peace talks looks to be the simpler part of his mission, compared with the task that awaits him in the Saudi capital of Riyadh — persuading the 13-country OPEC cartel to help bring down the soaring price of oil by boosting output. As cynics might say, good luck with that.

The stakes could hardly be higher: With a U.S. recession looming and the dollar at its lowest-ever value against major currencies, oil prices reached a new record high on Thursday, crashing through the $111 a barrel mark. That's a climb of about 30% in just six months, and this week it sent the prices at U.S. gas pumps soaring to a record national average of $3.27 a gallon.

President Bush last week urged Saudi Arabia — the world's leading oil producer — to help ease the crisis by pumping more oil onto the world market. He made a similar appeal in person when he visited King Abdullah in January. And now comes a new attempt by Cheney, as part of his 10-day trip to the region to discuss a number of crises. But oil analysts believe Cheney is unlikely to be any more successful than Bush has been.

Washington argues that a deep economic downturn in the United States — which consumes a quarter of the world's energy — could drive down global demand for oil, and wind up hurting oil-rich countries. But OPEC's 13 oil ministers — whose countries account for about 40% of the world's oil supply — have heard that argument from U.S. officials before, and have rejected it at three meetings in the past six months, most recently in Vienna on March 5. There, U.S. foes Venezuela and Iran took a lead in arguing against raising oil output.

The Saudis might find it politically difficult to change their position without consulting fellow OPEC members — who would surely reject the idea — says Greg Priddy, energy analyst for the Eurasia Group in Washington. "It would be a real loss of face if all of a sudden they would reverse course unilaterally," he says. Cheney's visit to Riyadh might be too late, says Priddy, adding about U.S. officials: "If they were going to ask [for increased oil production] they should have asked a month ago."

The Bush Administration could be working on the assumption that the Saudis and other allies could quietly increase production unilaterally, and relieve pressure on prices. After all, OPEC output quotas are hardly effectively policed. But analysts believe that assumption may be false. Priddy believes Americans might be unfairly pinning the blame on oil-rich countries. "They want to find someone to blame and Gulf countries aren't popular to begin with," he says. But producers are contending with rising production costs, while extracting oil has become more difficult as land-based wells with plentiful reserves have been depleted in many places, leaving expensive, complicated deep-sea drilling as the best hope for tapping massive new reserves.

The even larger problem facing Washington, however, is that as pricey as oil is these days, there's no shortage of customers elsewhere in the world. (There are also plenty of investors pouring billions into oil futures as a hedge against the falling dollar — and so driving up oil prices even more.) The major reason for the current high prices is that OPEC's production has been seriously stretched by the huge increase in demands from booming China and India, as well as from oil-rich countries in the Middle East itself, says Lawrence Eagles, chief economist of the Paris-based International Energy Agency, the watchdog for oil-consuming countries like the United States and those in the European Union. "Most OPEC members are working close to flat-out," he says. "There is little spare capacity outside of the United Arab Emirates and Saudi Arabia, and some of that is relatively poor quality crude." And right now, global demand continues to rise.

OPEC members are also haunted by the organization's misstep in 1998, when they voted to boost production quotas shortly before the Asian economic crisis hit. That sent oil crashing to $10 a barrel. Such prices may now seem like ancient history, but as Cheney flies out to the Middle East, he'll be visiting a region where ancient history can seem very fresh indeed.

Norwegian oil company DNO International said Friday it had revised an agreement with Kurdish authorities on splitting oil production in two licensing areas in northern Iraq.

DNO, the first foreign firm permitted to prospect for oil in Iraq after Saddam Hussein's fall, initially held 55 percent of the production licenses in Erbil and Dohok in Iraq's autonomous Kurdish region.

After revising the contract, the Dohok bloc was split in two parts, with DNO maintaining a 55 percent share of the Tawke oil field but only 40 percent of the remaining Dohok area.

DNO said its Erbil share had also been slimmed down to 40 percent.

"The new terms ... are now in line with recently enacted legislation and we are pleased with the overall terms of the contracts," DNO managing director Helge Eide said in a statement.

The new deal opens the way for DNO, which had previously been forced to sell all oil produced in the licensing areas locally, to export the black gold at a higher price.

The Norwegian company also said it was "encouraged" by initial test production in its Erbil bloc with some 9,000 barrels of oil and 11 million standard cubic feet (more than 311,600 cubic metres) of natural gas per day.

"It is the opinion of DNO that the terms of the ... contracts provide a solid basis for creating substantial values to our shareholders, the region and all of Iraq," the company said.

Its upbeat comments may however be premature in light of an ongoing conflict between the government in Baghdad and authorities in the Kurdish region of the country.

Iraqi Oil Minister Hussein Chahristani said for instance last week that "no oil contracts signed by any regions in Iraq will be recognised by the government of Iraq."

"Companies will not be allowed to work on Iraqi territory unless their contract is approved by the central government in Baghdad," he added.

In November the minister announced he had cancelled around 15 oil contracts signed by the authorities in Iraqi Kurdistan.

Following DNO's announcement on Friday it saw its stock price soar more than 15 percent on the Oslo stock exchange to 7.0 kroner (1.36 dollars, 0.88 euros) a share.

Crude oil dropped from a record in New York on concern that the rally in energy prices may reduce demand at a time of increasing supplies.

Oil futures climbed to a record $111 a barrel yesterday after the dollar fell below 100 yen for the first time since 1995 and dropped to an all-time low against the euro. U.S. crude stockpiles rose more than analysts forecast last week, while gasoline supplies jumped to the highest since 1993.

``Certainly it looks shaky, but it's been looking like that the past few days and kept rising,'' said Rowan Menzies, head of research for Commodity Warrants Australia Ltd. in Sydney. ``What could derail it is a slowdown'' in demand.

Crude oil for April delivery fell 56 cents, or 0.5 percent, to $109.77 a barrel at 8:47 a.m. Singapore time in after-hours trading on the New York Mercantile Exchange. Yesterday, futures rose 41 cents, or 0.4 percent, to settle at a record $110.33 a barrel. They earlier touched $111, the highest since trading began in 1983.

Brent crude for April settlement rose $1.27, or 1.2 percent, to $107.54 a barrel on London's ICE Futures Europe exchange, a record close. Futures reached an intraday record of $107.88 a barrel yesterday.

Stockpiles of crude and oil products in the developed economies of the Organization of Economic Cooperation and Development, or OECD, rose by 32.6 million barrels in January, reaching 2.62 billion barrels, the International Energy Agency said on March 11.

`Financial Bubble'

Those inventories alone could satisfy OECD demand for 52.9 days, compared with a five-year average of 51.8 days.

``We are waiting for the fundamentals of the physical market to pop this financial bubble; the only question is when it will occur,'' said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. ``Gasoline supplies are at a 15-year high, which can't be ignored forever.''

Gasoline inventories in the U.S. rose 1.69 million barrels to 236 million barrels last week, the highest since 1993, the Energy Department said March 12 in its weekly report.

Crude oil stockpiles climbed 6.18 million barrels to 311.6 million barrels in the week ended March 7, the Energy Department said. A 1.68 million-barrel gain was forecast, according to the median of responses in a Bloomberg News survey.

Inventories of crude in the U.S. in the week ended March 7 were 1.9 percent above the five-year average for the period, the department said. Gasoline stockpiles were 11 percent above the five-year average.

Reduced Oil Use

U.S. crude-oil use typically falls at this time of year when refiners schedule repairs and upgrades as U.S. heating- fuel demand slows and before warmer weather spurs an increase in gasoline consumption. Refineries operated at 85 percent of capacity last week, down 0.9 percentage point from the week ended Feb. 29.

Refiners in Asia also schedule maintenance in the second quarter.

The tumbling dollar has drawn investors to the crude market as commodities become cheaper for buyers with other currencies.

``It's been financially driven,'' Commodity Warrants' Menzies said. ``When you think it's going to drop, the dollar weakens and takes it back up again.''

The U.S. currency headed for the fifth straight week of declines against the euro and the fourth week of losses versus the yen before an industry report today that may show U.S. consumer confidence fell this month to the lowest in 16 years, giving the Federal Reserve more reason to cut interest rates further to avert a recession.

The dollar traded at $1.5612 per euro at 8:19 a.m. in Singapore, after touching $1.5645 per euro yesterday, the weakest since the European currency's debut in 1999. The dollar traded at 100.68 yen, after touching 99.77 yen, the lowest level since October 1995.

Traders expect the U.S. Federal Reserve to lower its benchmark rate by 0.75 percentage point to 2.25 percent, based on futures prices. The Federal Open Market Committee's next regular meeting is March 18.

South Korea's worst oil spill has devastated marine life, halving the number of sea plants and mollusks found off the western coast, a government report said Thursday.

The oil leak also threatened the underwater food chain, endangering fish and sea birds, the Environment Ministry report said.

Surveys following the spill last December showed mollusk populations had plunged to 56 creatures of five species per square metre from 133 creatures of eight species as mussels were found to have been considerably contaminated by remnants of crude oil.

The density of seaweeds per square metre fell 43 percent from February 2007 and phyllospadix iwatensis, a seagrass, also declined 47 percent.

"Because seagrasses and seaweeds make up the lowest part of the ocean food chain, there are risks of second-hand contamination of fish and birds that are at the top of the food pyramid," the report said.

The surveys, the first since the oil spill, were carried out in order to set up plans to restore damaged beaches and sea farms.

Hong Kong-registered supertanker Hebei Spirit spilled 10,900 tons of crude after it was rammed by a Samsung Heavy Industries barge in rough seas off Taean county on December 7.

Scores of marine farms and kilometres (miles) of beaches were devastated and three people in Taean, about 110 kilometres (70 miles) southwest of Seoul, killed themselves in frustration over delays in compensation.

Five people -- the skippers of the barge and of the two tugs, and the tanker's captain and chief officer -- are on trial on charges of negligence and violating anti-pollution laws.

Samsung Heavy Industries and Hebei Shipping, a Hong Kong corporation which owns the tanker, have also been charged with violating anti-pollution laws.

Local residents called for comprehensive restoration measures, claiming most sea creatures were wiped out following the spill.

"Oysters, crabs or octopuses have already gone. Even sea slugs or abalones are hard to find in the sea," Kang Tae-Chang, 47, was quoted as saying by Yonhap news agency.

Lim Hyo-Sang, 60, said he was worried further damage might occur as spring arrives and temperatures rise, causing heavy tar balls that have sunk to surface again.

Angry residents have protested against previous delays by local officials in distributing compensation from the central government.

Samsung Heavy Industries said last month it was donating some 107 million dollars to help victims, which they rejected as inadequate.

South Korea has reported to the International Oil Pollution Compensation Funds that the spill destroyed the livelihoods of 40,000 households and polluted 300 kilometres of shoreline, 101 islands, 15 beaches and 35,000 hectares (86,000 acres) of fish farms.