Natural Gas Sales Research Articles

KEY ISSUES OF ACCOUNTING FIXED ASSETS MANAGEMENT OF OIL AND GAS ENTERPRISES: ANALYSIS OF FEATURES, COMPOSITION AND VALUATION

The article deals with the key issues concerning the system of security of fixed assets at the enterprises of the oil and gas industry. The purpose of the article is to investigate the fixed assets features and composition at the the enterprises of oil and gas industry, to determine the approaches to their assessment at the stage of their receipt by the enterprise. The state, dynamics of value and the degree of depreciation of fixed assets in Ukraine for the year 2017 have been analyzed, their features have been distinguished at the enterprises of different branches of the economy. To ensure the effective operation of the enterprises of the oil and gas industry, significant assets are required, and the results of their activities to a large extent depend on the availability and condition of fixed assets that ensure economic sustainability of economic entities. Oil and gas companies include pipelines and related equipment in fixed assets, oil and gas assets, machinery and equipment, buildings, buffer gas, drilling and reconnaissance equipment and other fixed assets. Among the assets of NJSC "NAFTOGAZ OF UKRAINE" for the year 2017, non-current assets occupied 86% of the total assets of the company, of which 94% were fixed assets, what determines the reliability of their accounting as an important element of effective management of enterprises. The dynamics of value and composition of fixed assets of enterprises of the oil and gas industry of Ukraine for 2016-2017 have been determined according to separate economic segments. The cost of fixed assets of NJSC "NAFTOGAZ OF UKRAINE" as of December 31, 2017 amounted to UAH 491 482 million, respectively, according to economic segments, it is structured in such a way that their largest share is concentrated in the system of transportation and distribution of natural gas - almost 48%, for storage of natural gas - 34%, production and sale of natural gas - 12%, and the rest belongs to the economic activities related to oil: the production of crude oil and gas condensate, transportation of crude oil. The composition of fixed assets of extractive enterprises differs from their composition in refineries. Industrial features of mining industry with significant volumes of work related to the disclosure of layers of minerals are characteristic to chemical production with a significant cost of equipment. The main approaches to the evaluation of fixed assets objects at the stage of their entrance to the enterprise have been investigated. The reliability of the accounting information on fixed assets depends on their assessment. When they are received, they are valued at their original cost, that is, by the amount of cash paid or their equivalents or fair value, another form of indemnity granted to obtain the asset at the time of its acquisition or creation, or, if accepted, the amount that is distributed to that asset in the original recognized in accordance with the specific requirements of other IFRSs. After recognition, the entity should choose either a cost model or a revaluation model in its accounting policies and should apply this policy to the entire group of fixed assets. A cessation of recognition occurs after the release of an object or when it does not expect future economic benefits from its use or disposal. In this case, it is recognized as profit or loss.

Dependence on policy revenue poses risks for investments in dairy digesters

Manure-sourced methane emissions from livestock operations in California will soon be subject to new regulation, as required by Senate Bill 1383, which was signed into law in 2016. Regulations, beginning in 2024, will require reductions in methane emissions from livestock manure, with a 40% reduction target by 2030. The California dairy industry accounts for most of the manure-sourced methane emissions in the state and, in order to reduce these emissions, government experts and authorities have encouraged expansion of anaerobic digestion of dairy waste — especially to produce transportation fuel. Renewable natural gas for vehicle fuel, produced from manure at digesters, is eligible for substantial federal and California environmental credits, which are now projected to contribute the bulk of the revenue for qualifying digesters. This article shows that investments in digesters, because they depend heavily on revenue created by government policy, rather than on market-based sales of natural gas, are highly vulnerable to the risk of policy change or even minor technical adjustments in environmental regulations. Without secure projections of revenue that will cover costs, regulations may cause increases in the shift of milk production out of California.

The order of calculation and payment of tax on profit of commercial banks in the innovation economy

In the conditions of innovative economy of the tightening of the requirements of the Central Bank of the Russian Federation and the crisis of the banking system, in the conditions of a severe shortage of funds in the Russian Federation, taxes and fees levied on credit institutions are one of the main revenue sources of the state budget after the extraction, processing, transportation, warehousing and sale of natural resources-oil, gas and related petroleum products. In practice, the taxation of profits of credit institutions is under the close attention of the state. So, PJSC "Sberbank of Russia" in 2016, took fifth place among the largest Russian taxpayers, losing the leadership of the JSC "NK Rosneft", PJSC "Gazprom", PJSC "LUKOIL" and JSC "Surgutneftegas". At the same time in 2015 PJSC "Sberbank of Russia" has taken only the tenth place. A particularly urgent task in modern conditions is the reduction of the strongly expressed fiscal orientation of taxes and fees and the increase of their motivating role, as well as the strengthening of the legal regulation of fees and taxes as a complex part of the legislation in the field of taxation of Russia as a whole. The article describes taxpayers, the object of taxation on income tax of a commercial Bank. The detailed calculation of the tax base of income tax of PJSC "Sberbank of Russia" by year is presented. The table of calculation of the Bank's income is provided, by results of the analysis it is revealed that the greatest share in structure of the income is occupied by interest income all three years about 90%, however dynamics of development of banking sector and global tendencies dictate growth of Commission income in structure of the General income. Distinct dynamics can be traced clearly. The calculation of expenses for three years of PJSC “Sberbank of Russia” is also presented, the analysis is carried out, conclusions are formulated. According to the results of the work the conclusion about the need for further development of the system of taxation of commercial banks in obligatory correlation with the strategy and objectives of development of other sectors of the national economy of Russia.

Biogas Program for Cooking in Haiti: Helping to Save Life, the Environment, and the Economy

The objective of this paper is to assess, from an economic perspective, the extent to which biogas (natural gas), instead of propane, can be partially substituted for charcoal. Using the benefit-cost analysis (BCA) approach, I assess a broad range of benefits: direct economic benefits through the sale of natural gas and slurry as well as savings of time and energy and indirect health and environmental benefits. Using a medium scenario ($0.70/m3 of methane, a discount rate of 5 percent and a Disability-Adjusted Life Year [DALY] valued at 3x GDP per capita), the benefit-to-cost ratio (BCR) is 2.0, which suggests that the intervention should be considered. Still, the daily cost for households using natural gas is estimated to be 45 percent less expensive than using charcoal and 5 percent less expensive than propane. Policy advisors making a decision between the use of biogas and propane as a partial substitute for charcoal in Haiti need to consider the impact not only on the environment and health but also on the economy and the balance of trade. They should subsidize activities that help keep the carbon locked as well as transactions that contribute to improving the balance of trade. On the other hand, they should tax activities that free up carbon as well as transactions that contribute to deteriorating the balance of trade.

An MILP model for optimal design of multi-period natural gas transmission network

This paper develops an MILP model for designing multi-period natural gas transmission network to determine the connections of pipeline and the sites of compressor stations with consideration of terrains and obstacles. Equations of mass balance of network nodes, pressure drop of pipelines and pressure increase of compressors are all taken into account. A piece-wise linearization method is applied to the model. Four cases of natural gas transmission networks in Shanxi province (China) are studied. The result illustrates that the model can tackle complicated natural gas transmission network optimization problems. The developed model is of practical value for natural gas sales enterprises to minimize the construction cost and is a good designing reference for construction contractors.

The curious case of an arbitration with two annulment courts: comments on the YPF saga

This article deals with the jurisdictional and substantive issues of a Latin American multi-party, multi-contract arbitration, related to a dispute arising out of a contract for the international sale of natural gas, which contained an arbitration agreement, calling for ICC arbitration in Montevideo. This arbitration agreement contained a clause in which the parties expressly agreed to apply Argentine arbitration law to annulment procedures and granted exclusive jurisdiction to the Argentine courts to hear any challenge to the prospective award. Eventually, there was a debate on the validity of this clause and the Argentine and Uruguayan courts claimed to have exclusive jurisdiction to hear annulment petitions. This article addresses the different approaches under which this issue can be analysed, and concludes that the parties’ choice of forum should be respected. Regarding the substantive issues, one part of the case that involved the claimant and two of the respondents was governed by the Contracts for the International Sale of Goods (CISG).1 Among other aspects, this article explains that the standard to consider an anticipatory breach is very high, so that mere manifestations that the basis of the contract has been affected are not enough to consider such kind of breach. Moreover, it explains that the intention of the breaching party is not a relevant factor to determine compensation, since the CISG is based on an objective regime, in which foreseeability is the relevant factor.

With Cheap Batteries, Can Electricity Storage Threaten Natural Gas Sales?

As an energy form, natural gas enjoys unique cost and environmental advantages—it's free of sulfur, particulates, and most other air contaminants; is plentiful at low prices; and emits the least carbon of any carbon fuel.

Удосконалення методів визначення ставок оподаткування за користування надрами для видобутку природного газу

The aim of the article is to improve the taxation system of natural gas recovery in Ukraine. Author has systematized key characteristics of actual domestic natural gas reserves and resources, and features and conditions of natural gas recovery in Ukraine. In order to determine the actual rates of tax payments in fiscal sense for natural gas resources, the author proposes to distinguish the term of royalty as part of the rent as the term in economic sense and gives a schematic arrangement of distribution of the value received from the use of mineral resources. The author proposes an improvement of the current approaches to tax payments for natural gas recovery based on the determination of the royalty rate for each natural gas field (reservoir). Also, a correlation-regression model is built based on gas recovery cost interdependence from five key geological and operational factors (reserve size, depth of recovery, well flow rate, gas condensate factor, reservoir's life) for 133 natural gas fields under study. The array of these 133 reservoirs accounts for over 85% of Ukraine's gas recovery in 2013. The new approach is applied to royalty rates differentiation and determination for each gas reservoir from the array under study as option 1, and for other potential gas field based on the ranges of the affecting factors of the model as option 2. The author proposes calculation algorithms and formulas for royalty rates determination as share (%) of natural gas sales price as well as the price (value rate) for the natural unit of gas recovered (in currency for 1000 cubic meters). In order to prove the proposed approach, the author uses the examples of natural gas recovery operational expenses and royalty calculation by two described options for Yablunivske oil-gas condensate and natural gas field. In conclusions, the author formulates the main conditions and incentives to increase domestic natural gas recovery based on proposed improvement of royalty determination approach. The author recognizes that the proposed approach requires a large massive of data about expenses and prices of natural gas recovery and sales. At the same time, Ukraine is currently going to apply EITI principles whose implication will help to provide all necessary data for royalty rates determination.

Sergey Rumyancev, Ускользающая современность: постсоветская модернизация Азербайджана / Vanishing Modernity: The Post-Soviet Modernization of Azerbaijan

The article focuses on the debates situation of post-soviet modernization and transformation of Azerbaijan. The Azerbaijani economy failed to become a market economy, and remains instead predominantly based on the extraction and sale of oil and natural gas. Cities are being ruralised instead of the urbanization of rural areas. In its turn, industrialization ended together with the Soviet Union. A more or less tangible individualization and fragmentation of social life are not part of the history of post-Soviet Azerbaijan either. The political and economic systems of Azerbaijan are an imitation of a modern state. It is an example of a simulacrum state and a total imitation of modern political institutions and relations. In other words: The political regime in Azerbaijan is a complex of imitative practices, relations and “institutional camouflages” that enable a broad international presentation of Azerbaijan, effectively privatized by a small group of people, as a modern state that exists in reality.

도시가스 일일수요의 단기예측

Korea gas corporation (KOGAS) is responsible for the whole sale of natural gas in the domestic market. It is important to forecast the daily demand of city gas for supply and demand control, and delivery management. Since there is the autoregressive characteristic in the daily gas demand, we introduce a modified autoregressive model as the first step. The daily gas demand also has a close connection with the outdoor temperature. Accordingly, our second proposed model is a temperature-based model. Those two models, however, do not meet the requirement for forecasting performances. To produce acceptable forecasting performances, we develop a weighted average model which compounds the autoregressive model and the temperature model. To examine our proposed methods, the forecasting results are provided. We confirm that our method can forecast the daily city gas demand accurately with reasonable performances.

Controlled-Freeze Technology for Processing Sour-Gas Resources

This article, written by Senior Technology Editor Dennis Denney, contains highlights of paper IPTC 16848, ’The Controlled-Freeze-Zone Technology for the Development of Sour-Gas Resources,’ by J.A. Valencia, SPE, and S.D. Kelman, SPE, ExxonMobil Upstream Research, prepared for the 2013 International Petroleum Technology Conference, Beijing, 26-28 March. The paper has not been peer reviewed. A single-step cryogenic-distillation process that removes carbon dioxide (CO2), hydrogen sulfide (H2S), and other impurities from natural gas has been developed by ExxonMobil. Rather than avoiding the freezing of CO2 at cryogenic temperatures, solidification is allowed to take place in a very controlled fashion. The technology has potential to separate CO2 and other impurities from natural gas and to discharge these contaminants as a high-pressure liquid stream. Introduction Meeting the demand for natural gas will require new resources. Many of those new resources will contain substantial amounts of CO2 and H2S that must be managed properly at the surface along with the produced hydrocarbons. Returning the CO2 and H2S to the subsurface for geosequestration or for use in enhanced oil recovery is emerging as a preferred option for management and disposal. A controlled-freeze technology can help meet that goal. Acid-Gas Injection When acid-gas injection is required for processing sour-gas resources, the treatment-process options shift toward releasing the acid gases from the natural gas at a relatively high pressure and as a liquid. Natural-gas fractionation can be designed to recover acid gas at high pressure and, at least partially in some cases, as a liquid. This method minimizes the power required for compression or pumping for reinjection of the waste acid gases. Fractionation-based processes rely on the relative volatility of the components in the sour-natural-gas stream. Bulk fractionation uses a single refrigerated tower for the bulk removal of acid-gas compounds, but the overhead sweet product still has a high residual-CO2 content of 15% or more. Higher purities would require lower temperatures, which in turn would lead to CO2 solidification occurring in the distillation column. Therefore, further treatment, usually with a solvent process, is needed to achieve the quality specifications normally required for natural-gas sales to transmission systems. The Ryan-Holmes process can achieve the required high-purity natural gas by use of a multiple-tower fractionation operation. This process uses a heavier-hydrocarbon liquid additive to suppress CO2 freezing during the distillation process. This hydrocarbon additive lowers the freezing point of CO2 in the first column and is recovered in later columns and recycled. While effective, this process requires that the recovered acid gas be vaporized during recovery of the hydrocarbon-liquid additive. Like the Ryan-Holmes process, the controlled-freeze process (CFP) is a single-step cryogenic-distillation process that is capable of achieving a high-quality sales-gas product. However, no hydrocarbon additive is required for the desired separation, so the second distillation step to recover the additive is not required. Also, the acid gas can be recovered as a high-pressure liquid, so pumping can be used for reinjection.

Observations on Mergers and Acquisitions in the Marcellus/Utica Shale Patch

The discovery of how to efficiently access the gas in the Marcellus and Utica shale formations by horizontal drilling and advanced hydrofracturing techniques has led to a boom in oil and gas merger and acquisition (“M&A”) activity in the New York, Pennsylvania, Ohio and West Virginia regions. Environmental and energy lawyers are increasingly in the middle of such transactions as their clients become buyers of, or sellers to, other oil and gas companies. As development of the Marcellus/Utica shale formations matures, the M&A activity now seen in the Eagle Ford shale formation in Texas may be duplicated. With Henry Hub natural gas spot prices approaching $4.50 per million BTUs (natural gas prices since 2000 have ranged from $2.66 to $13.42 per million BTUs) the M&A activity should further increase. The value of oil and gas transactions in 2012 was $321 billion, up 7% from 2011’s $300.6 billion. Due in large part to low interest rates, which lessen the cost of borrowing the purchase price and provide low returns on invested cash, 76% of mergers and acquisitions in 2012 were for cash, up from 73% in 2011. When gas prices were lower in recent years the finance activity was somewhat diverted to midstream investments in gas processing facilities, gas gathering systems, and pipelines to handle natural gas liquids (“NGLs”), which activities had a higher margin than natural gas sales. This article discusses a few of the legal techniques used for oil and gas mergers and acquisitions, reviews some of the legal issues that should be considered, and discusses a few transaction techniques that use interests in real estate and operational contracts as the vehicle for the transaction.

Putting a floor on energy savings: Comparing state energy efficiency resource standards

Energy efficiency resource standards (EERS) refer to policies that require utilities and other covered entities to achieve quantitative goals for reducing energy use by a certain year. EERS policies generally apply to electricity and natural gas sales and electricity peak demand, though they also cover other energy sources in Europe. Our study aggregates information about the requirements of existing EERS policies for electricity sales in the United States. We convert quantitative goals into comparable terms to compare the nominal stringency of EERS programs across states. EERS programs also differ in their nonquantitative requirements, including flexibility measures; measurement and verification programs; and penalties and positive incentives. We compare the U.S. policies to similar policies in Europe and discuss important policy issues, including exogenous changes in fuel prices and issues with utility management of energy efficiency programs.

Нефтегазовый фактор во внешней политике Ирана

The author’s analysis is based on the assumption of special importance of the energy factor in the world politics. The author considers the problems of Iranian oil and gas sector, the outcomes of strict pressures of the international sanctions against the national nuclear program, the Tehran’s retaliatory measures. Also, the article deals with the issues of extraction and sales of Iranian natural gas, as well as of production and exports of petroleum products. Most likely, as the author states, the sanctions will not provide the desired results.

The Dynamic Simulation of a Long Distance Natural Gas Pipeline

With the growth of the natural gas market, the long distance natural gas pipeline system is getting more and more important in nowadays. As a united and enclosed hydraulic system, the operation conditions of the whole line will be changed by the influence of the condition change in one station. On the one hand, the condition change made people analyze operation scheme more difficult, on the other hand, pipeline system operating conditions directly affect the relationship between the production and the sales of natural gas. Therefore, the operation of the gas pipeline must be optimized, which brings huge economic and social benefits. This paper constructed a simulation model of a long distance natural gas pipeline by TG.net, and then analyzed the change of the operating condition of the pipeline after a compressor station shut down, found out the regularity.

Putting a Floor on Energy Savings: Comparing State Energy Efficiency Resource Standards

Energy efficiency resource standards (EERS) refer to policies that require utilities and other covered entities to achieve quantitative goals for reducing energy use by a certain year. EERS policies generally apply to electricity and natural gas sales and electricity peak demand, though they also cover other energy sources in Europe. Our study aggregates information about the requirements of existing EERS policies for electricity sales in the United States. We convert quantitative goals into comparable terms to compare the nominal stringency of EERS programs across states. EERS programs also differ in their nonquantitative requirements, including flexibility measures, measurement and verification programs, and penalties and positive incentives. We compare the U.S. policies to similar policies in the European Union and discuss important policy issues, including exogenous changes in fuel prices and issues with utility management of energy efficiency programs.

A joint power and desalination plant for Sinai and the Gaza Strip

Desalination can be a cost-effective way to produce fresh water and possibly electricity. The Gaza Strip has had a complex hydro-political situation for many years. Gaza is bordered by the Mediterranean sea in the west, by Israel to the north and east and by Egypt in the south. Water and electricity consumption in the Gaza Strip is expected to increase in the future due to the increasing population. In this paper, a solution for Sinai and the Gaza Strip is suggested involving the building of a joint power and desalination plant, located in Egypt close to the border with Gaza. The suggested joint project would increase drinking water supply by 500,000 m3/d and the power supply by 500 MW, of which two thirds is suggested to be used in Gaza and one third in Sinai. The present lack of electricity and water in Gaza could be erased by such a project. But Egypt will probably gain more: more water and electricity for the future development of Sinai and Gaza; a significant value will be added to the sale of Egyptian natural gas; more employment opportunities for Sinai people; the domestic market for operation and maintenance of desalination plants can be boosted by the suggested project; Egypt may naturally and peacefully increase its cooperation with and presence in Gaza, which should lead to increased security. This type of project could also get international support and can be a role-model for cooperation and trust-building between neighbours.

Energy Security and Competition Policy

The OECD Competition Committee debated energy security and competition policy in February 2007. This roundtable examined the links between competition policy and energy security, with a focus on natural gas. The discussion began by addressing the questions of the meaning and importance of energy security; and the determinants of energy security, particularly as they relate to competition policy. It continued in dealing with gas supply, transportation, and distribution, addressing five aspects that relate to different aspects of energy security: (1) the role of substitutes for natural gas in fostering competitive gas supply; the role of regulation in promoting or inhibiting infrastructure investment; (2) how to promote an adequate level of infrastructure investment; (3) the role of unbundling in fostering competition and promoting energy security; (4) the role of storage capacity in system efficiency and buyer bargaining position; (5) and the determinants of entry into merchant sales of natural gas.

WGL Holdings, Inc.

AbstractGas Utilities (MIC: SIC: 4924 NAIC: 221210)WGL Holdings is a holding company. Through its subsidiaries, Co. sells and delivers natural gas, and provides energy‐related products and services to customers in Washington, D.C., and the surrounding metropolitan areas in Maryland and Virginia. Co.'s subsidiary, Washington Gas, is engaged in the delivery and sale of natural gas that is predominantly regulated by state regulatory commissions. Through wholly owned subsidiaries of Washington Gas Resources, Co. also offers energy‐related products and services that are closely related to its core business. Co. has three operating segments: regulated utility; retail energy marketing; and commercial heating, ventilating and air conditioning.

Exxon Mobil Corp.

AbstractOil and Gas (MIC: SIC: 2911 NAIC: 324110)ExxonMobil, through its affiliates, is primarily engaged in the energy business, involving exploration for, and production of, crude oil and natural gas, manufacture of petroleum products and transportation and sale of crude oil, natural gas and petroleum products. Co. manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics and a variety of specialty products. Co. also has interests in electric power generation facilities. Affiliates of Co. conduct research programs in support of these businesses. Co. has several divisions and hundreds of affiliates, many with names that include ExxonMobil, Exxon, Esso or Mobil.