Energy Sector Roundup: Iraq Drives Oil

Oil Sails Past $107 Again

Oil futures shot back above $107 a barrel after insurgents bombed an Iraqi oil pipeline.

Light, sweet crude for May delivery rose $1.68 to settle at $107.58 a barrel on the New York Mercantile Exchange after earlier climbing as high as $108.22.

The bombing of a key Iraqi oil pipeline Thursday morning appeared to slow oil exports from the southern oil city of Basra, despite oil officials' statements to the contrary. Dow Jones Newswires reported that exports from southern Iraqi terminals have been reduced to about 1.2 million barrels a day from a normal rate of 1.56 million barrels a day. Most of Iraq's oil goes to Europe and Asia.

In other Nymex trading, April heating oil futures rose by 10.45 cents to settle at $3.1483 a gallon, while April gasoline futures slid by 2.66 cents to settle at $2.7163 a gallon.

In London, Brent crude gained $1.01 to settle at $105 a barrel on the ICE Futures exchange.

Natural Gas Supplies Ending Heating Season Below Year-Ago Level

The Energy Department's Energy Information Administration said in its weekly report that natural gas inventories in underground storage in the lower 48 states fell by 36 billion cubic feet to nearly 1.28 trillion cubic feet for the week ending March 21.

The draw roughly matched the consensus estimate of analysts.

The inventory level was above the five-year average of more than 1.24 trillion cubic feet in underground storage, but below last year's storage level of about 1.52 trillion cubic feet, according to the government data.

Monday marks the official end of the heating season, which should end with fairly chilly weather in the Northeast and Midwest, according to forecasters.

Calyon Securities analyst Carin Denhe Kiley said this past winter was 3.4 percent colder than the five-year average, based on heating-degree days.

Looking ahead to the summer cooling season, Kiley said private forecasters expect June to be warmer than normal along the East Coast and cooler than normal in the middle of the country except Texas.

April natural gas futures rose by 0.6 cent to settle at $9.578 per 1,000 cubic feet.

Marathon Sees Production and Reserves Rising

At a meeting with Wall Street analysts in New York, Marathon Oil Corp. President and Chief Executive Clarence P. Cazalot Jr. said Marathon expects its crude oil and natural gas production to increase at least 8 percent in 2008 and to grow roughly 7 percent over the next five years.

Cazalot also sees proved reserves rising by about 15 percent through 2012.

Marathon said the $3.2 billion expansion of the company's Garyville, La., refinery was 38 percent complete, and was on time and on budget. The company is also upgrading its Detroit refinery to handle more heavy crude from the Athabasca Oil Sands Project in Alberta, Canada. Marathon has a 20 percent stake in that project.

Marathon estimates capital and exploration spending will be about $18.5 billion through 2012.

CNOOC Posts Lackluster 2007 Earnings

CNOOC Ltd., China's largest offshore oil and gas producer by capacity, said 2007 net profit rose only about 1 percent with minimal increases in output and a big jump in the windfall tax on oil sales.

Net profit in 2007 rose to $4.28 billion from $4.24 billion the previous year. Revenue rose 2 percent to $13 billion.

Total output of oil and gas last year rose 2.6 percent to 171 million barrels of oil equivalent (boe). The company's Liuhua oil field was shut down after a typhoon. Some bigger fields are not due to start production until later this year.

CNOOC aims to produce 195 million to 199 million boe this year. It expects its output from offshore China to rise to 171 million to 173 million boe from 149 million boe in 2007.

Norsk Hydro Raises Ascent Solar Stake

Shares of Ascent Solar Technologies Inc. took off following news that Norwegian aluminum company Norsk Hydro ASA increased its stake in the company to 35 percent from 23 percent.

In afternoon trading, Ascent shares rose $3.59, or 30 percent, to $15.55.

Norsk exercised an option to buy another 2.3 million Ascent shares and 1.7 million Class B warrants. Ascent made $28.4 million in gross proceeds on the deal.

Norsk, the company's largest shareholder, bought 1.6 million shares from Ascent in March 2007. Ascent also gave Norsk two options to purchase additional shares of stock and warrants. Norsk exercised the first option in August 2007, after which it owned 23 percent of Ascent stock and warrants.

Ascent plans to integrate its solar modules into Norsk's aluminum-based building products; including sun-shading systems, wall systems and facades.

Credit Suisse to Invest in Renewables

Credit Suisse will invest at least $300 million in the renewable energy sector through private equity firm Hudson Clean Energy Partners. John Cavalier, head of Credit Suisse's Renewable Energy investment banking practice, will become a Hudson partner.

Cavalier joins Neil Auerbach, Hudson's founder, as co-Managing Partner of the investment platform. Cavalier was formerly chairman of the Energy Group and vice chairman of Investment Banking Department Americas in Credit Suisse's investment banking division.

Before starting Hudson, Auerbach was a partner at Goldman Sachs, where he created and led Goldman's U.S. Alternative Energy investment business and managed over $3 billion in assets for the firm. Auerbach launched Hudson with Daniel Gross and Joseph Slamm, former Goldman colleagues from the U.S. Alternative Energy investment business who are also partners at Hudson.

Hudson focuses on high-growth, asset-based, capital-intensive segments in the clean energy sector using commercialized technologies to produce energy from wind, solar, geothermal, biomass and other renewable sources.

NRG Starts Texas Wind Farm Construction

NRG Energy, Inc. subsidiary Padoma Wind Power LLC started building the Elbow Creek Wind Project, a 122 megawatt (MW) wind farm near Big Spring, Texas.

Construction is expected to take nine months with commercial operation by the end of the year. NRG said the project will use 53 Siemens 2.3 MW wind turbine generators enough to supply power to nearly 100,000 homes.

In February NRG announced a 50 percent partnership with BP Alternative Energy North America Inc. to build the first phase of the Sherbino Wind Farm, a 150 MW wind project in Pecos County, Texas.

--Compiled by AP Business Writer Greg Stec. Questions or comments can be directed to gstec@ap.org.