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International Crude Oil Market Handbook


1997-98 Edition

PETROLEUM INTELLIGENCE WEEKLYS

International Crude Oil Market Handbook


1997-98 Second Edition

Thomas Wallin Ira Joseph

Published by:

PIW PUBLICATIONS

The Oil Daily Co.

Production: Tim Nudd January 1997


Photocopying or reproduction in any form is prohibited. 1997 PIW Publications and The Oil Daily Co.

PUBLISHER: Edward L. Morse. PRICE: $1,035, $825 for PIW and Oil Daily subscribers (addl copies $465, $375) PIW: 575 Broadway, 4th Floor, New York, NY 10012. Tel.: (212) 941-5500; Fax: (212) 941-5509 OIL DAILY: 1401 New York Ave., Suite 500, N.W., Washington, DC 20005. Tel. (202) 662-0700; Fax: (202) 662-0739

Do Not Reproduce
Copyright 1997 PIW Publications and The Oil Daily Co. Unauthorized copying of PIWs International Crude Oil Market Handbook is prohibited by US copyright law and international law. No part of this publication may be reproduced, electronically transmitted (e.g. via fax or e-mail), or electronically stored in a database without the prior written permission of the publisher. Additional copies of this book may be purchased at a discount. Please contact the Circulation Department at PIWs New York office, (212) 941-5500, fax (212) 941-5509.

PETROLEUM INTELLIGENCE WEEKLYS

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1997-98 Second Edition Table of Contents Overview: The Inner Workings Of Crude Oil Markets
A. Introduction Understanding Crude Oil Markets
. . . . . . . . . . . . . . . . . . . .A1

B. The Spot Market The Revolutionary Impact Of Spot Trading . . . . . . .B1 C. Term Sales Constant Evolution Transforms Term Contracts D. Logistics Tankers, Pipelines, And Stocks E. Refining Whats A Crude Oil Worth? Glossary Of Terms
. . . . . . .C1 . . . . . . . . . . . . . . . . . . . . . . . . . .D1

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E1

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E15

Reference Section: Profiles, Trade, And Prices


F. Country Profiles How Countries Market Their Crude Oil
. . . . . . . . . . . .F1 . . . . . . . .G1

G. Term Contracts And Trade Flows By Country And Company I. Prices Spot And Term Contract Prices For Key Grades

H. Crude Oil Profiles A View Of the Market Through Each Grade . . . . .H1
. . . . . . . . . . . .I1

The Inner Workings Of Crude Oil Markets


Table of Contents
A. B. Introduction Understanding Crude Oil Markets . . . . . . . . . . . . . . . . . .A1 The Spot Market The Revolutionary Impact Of Spot Trading . . . . . . . .B1 A Spot Market Daisy Chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B2 Benchmark Crude Oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B6 Brent: The International Benchmark . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B9 West Texas Intermediate: Improbable Price Leader . . . . . . . . . . . . . . .B15 Dubai: A Benchmark In Limbo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B19 Spot, Forward, And Futures Markets For Key World Grades In 1996 . . .B28 C. Term Sales Constant Evolution Transforms Term Contracts . . . . . . . .C1 An Example Of How A Formula Price Is Determined . . . . . . . . . . . . . . . .C8 Dependence Of Term Contracts On Spot Benchmarks . . . . . . . . . . . . .C11 D. Logistics Tankers, Pipelines, And Stocks . . . . . . . . . . . . . . . . . . . . . .D1 Tankers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D1 Pipelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D6 Shipping Distances And Times For Key Tanker Routes . . . . . . . . . . . . . .D7 Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D12 Major Pipeline Links In World Crude Oil Trade . . . . . . . . . . . . . . . . . . .D13 E. Refining Whats A Crude Oil Worth? . . . . . . . . . . . . . . . . . . . . . . . . . .E1 An Overall Look At The Refining Process . . . . . . . . . . . . . . . . . . . . . . . .E2 Calculating A Netback . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E5 PIW Pacesetter Crude Oil Yields . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E7-8 Types Of Crude Oils And Their Characteristics . . . . . . . . . . . . . . . . . . . .E9 Gasoline And Naphtha . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E11 Kerosine, Gas Oil, And Residue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E12 Glossary Of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E15

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INTRODUCTION

Understanding Crude Oil Markets


This second edition of PIWs International Crude Oil Market Handbook builds on the success and strengths of the first volume, which was published in 1994. The basic purpose of the book remains the same: to provide a comprehensive picture of international oil markets in all of their broad scope and complexity. This new edition completely updates the original version and adds a number of valuable new features. The entire book has been fully revised to reflect a vast array of changes, both large and small, that have occurred in the worlds constantly evolving crude oil markets over the last two years. With rising non-Opec production, a number of new crude oil streams are appearing on the market. Among the new features of the handbook are profiles of over 20 of these crude oils, bringing the total to 134 individual streams. And there are completely new assays for more than 60 of these. The price data and information on term-contract volumes and trade flows have also been updated and expanded, providing a more robust reference section. Despite the many enhancements, this second edition of the handbook has much the same structure as its predecessor and provides valuable information for both the experienced oil trader and the newcomer to crude oil markets. The first section of the book, The Inner Workings Of Crude Oil Markets, provides a brief but thorough analysis of the main features of these markets. By taking a comprehensive view and bringing together a wealth of data and information from a wide array of unique and hard-to-access sources, this section provides important insights for experienced analysts as well as a valuable introduction to the subject. The second section of the book is designed exclusively for reference purposes, providing profiles of both the current marketing strategies of individual countries and basic data and characteristics on 134 crude oil streams. All of this is supplemented by extensive data on prices and trade flows, much of which are unique to PIW and its sister publications.

Crude Oil: A Special Commodity


The size, scope, and complexity of global crude oil trade are unique among physical commodities. With more than $400-billion a year in physical transactions, encompassing scores of different crude oil grades going to hundreds of refineries all over the world, it overshadows other physical commodity markets. Beyond its sheer scale, worldwide crude oil trade in the last 25 years has gone through revolutionary changes that have had broad political and economic impact, adding to its uniqueness. The strategic importance of petroleum, the crucial role that it plays in the economies of both importing and exporting countries, and the heavy reliance on it, despite efforts to diversify sources of energy, also magnify the critical significance of global commerce in crude oil. Despite the evolution of oil trade toward free-market structures in most parts of the world over the last 10 to 20 years, it seems improbable that crude oil will become a commodity like any other. Although it has taken on many of the trappings of other markets, crude oil is likely to remain in a league of its own due to its inherent complexity and the political and macroeconomic importance that it bears.

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The transformation from the stable, controlled supply systems of the international majors in the 1960s to the volatile, freewheeling markets of the mid1990s underscores another crucial aspect of todays crude oil trade: its dynamism. Not only are prices volatile, but virtually all aspects of the global crude oil market have been in a constant process of transformation. This commerce is in many ways almost unrecognizably different from what it was just 15 years ago. The participants have grown much more diverse, traditional supply links have disintegrated or been transformed, and the pressure of competition has grown relentlessly. Even up until the late 1970s, the international crude oil market was considered to be a comfortable club with membership drawn mainly from the ranks of major oil companies and heavily dominated by them. With the growth of price volatility, the surge in non-Opec supply sources, the rising importance of national oil companies, the breakup of the Soviet Union, and a host of other changes, the commerce in crude oil has become more diverse, complex, and competitive. Change is now a constant. One important and visible measure of this dynamism lies in the growth of futures markets and other instruments for handling price risk. In contrast to the state of flux that has now become the norm for crude oil markets, the physical characteristics of crude oil have always conspired to create a special degree of complexity that makes it unusual among commodities. Each crude oil from each field is unique in quality, and significant variations can even occur in the quality of a single fields output over time. This means that individual crude oils can present special challenges in handling and refining and, therefore, in their valuations in the marketplace. While all crude oils are capable of producing similar end products, the crude oils themselves are far from interchangeable and must be treated individually. The specific characteristics of different types of crude oil must be taken into account in order for refiners to realize the full advantage of their special qualities. This operational constraint has led to the tailoring of refineries and transportation and storage systems to cope with particular grades.

Upstream Meets Downstream


For the oil industry, crude oil trade represents the key nexus between the two main centers of activity: upstream exploration and production, and downstream refining and marketing. Not only does it determine the value of upstream output, but it also defines the cost of the main downstream feedstocks. Operational decisions about combining output from various fields to create a specific crude oil export stream with certain characteristics are constantly tested in the market against refiners requirements for specific feedstocks to meet final demand for a changing combination of products. Due to the extensive vertical integration of the oil industry until the early 1970s, these decisions were largely kept under the umbrella of major oil companies. Under the current free-market system, the performance of the crude oil market provides key signals for basic operational decisions throughout the industry. Despite the radical changes in oil trade, an underlying constant has prevailed in the way that a crude oils value is determined. Crude oil itself has almost no direct end uses. A barrel of crude oil from a single stream has value to a refiner only in terms of the products that it can yield. Ever since the simplest distillation units were invented more than a century ago to refine oil and produce illuminating kerosine, it has been the value of the end products that ultimately determines a crude oils value. Each

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unique stream of crude oil generates different combinations of final products, all of which compete in independent markets. The value of the crude oil is therefore derived from the combined value of these co-products, which range from the lightest liquid petroleum gases and sophisticated gasolines to the heaviest fuel oils for ships and industrial boilers. The price of crude oil emerges from a complex interaction between the signals provided by product markets through the purchasing decisions of refiners, and the varying revenue objectives of producers. This process has rarely been purely economic, and it has had political overtones for most of this century because of oils strategic importance. While Opec is currently the most visible expression of this political dimension to crude oil prices, other countries and political groups within them have strongly held stakes. Although most large industrial countries have adopted a profree-market stance, even these big consumers have clear concerns and preferences about the level, direction, and volatility of oil prices as they affect their economies. The structure of the markets and their importance as a source of tax revenue are also key political issues. Because of all of these political influences, oil markets do not single-handedly determine crude oil prices. Rather, they help to define the general level.

Spot Market Dominance


Perhaps the most important underlying trend in crude oil markets over the last 20 years has been the drive toward marginal pricing linked to spot barrels. In the 1960s and early 1970s, the spot market was a small trickle compared to the much larger flows under term contracts in the integrated systems of major oil companies. Now the situation is totally reversed: The spot market calls the tune. This transformation, which is described in more detail in the following chapter, reflects a combination of factors, including three price shocks: the explosions of 1973-74 and 1979-80, and the collapse of 1985-86. With hindsight, the relentless pressure applied by the free market seems to have been inevitably leading to some version of the spot-price-driven structure that now exists despite the many political and institutional factors that stood in the way. The reliance on the spot market has many obvious attractions for all market participants, which is why it is predominant today. But the accompanying volatility and the inherent competitive pressure in these markets to move toward marginal pricing of incremental supplies in which prices are set to equal the additional cost of obtaining an extra unit of output pose genuine perils for the oil industry. It is not at all clear that spot prices reflect the long-term marginal costs of future crude oil supplies, a relationship that economists generally consider to be a critical prerequisite for the smooth operation of the industry. One of the basic contradictions of the oil business that has existed virtually since its inception is that the high investment costs and long lead times of oil projects require higher prices than those implied by the relatively low short-term operating costs of existing fields. With Opec itself coming closer to its output capacity as oil companies minimize inventories, and with all parties, from refineries to drilling rigs, operating at much higher rates of utilization, the oil industry in the mid-1990s shows some clear signs of moving into a period of greater upward pressure on spot prices.

Two Different Perspectives


This book describes the complexity of the global crude oil market from two completely different perspectives and in this sense, it is two books in one. The

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first section, The Inner Workings Of Crude Oil Markets, provides a description and analysis of the many elements of the international crude oil trade, highlighting the themes mentioned above and others that trace its development and current structure. The second section is essentially a reference book that has proved an invaluable daily companion to oil market participants and analysts. For over 130 individual crude oils, it furnishes all of the vital information that is needed by anyone involved in any way in the market. It also contains detailed profiles of the marketing strategies of the 36 main crude oil exporting countries and a wealth of price and trade data. Similar books have been put together in the past by a few major international oil companies for their own internal use, but these were never widely distributed and most have been discontinued as companies have cut costs. The next four chapters of the book, which make up the first section, can be read either as a unified whole or randomly for reference purposes. They begin with a basic description of the spot market and its origins before discussing the key international benchmark grades that set the pace for virtually all crude oil sales worldwide. This is followed by a description of the growing importance of the futures market and then an analysis of the evolution of term-contract supply arrangements. The logistics of crude oil transportation by ship and pipeline are presented, along with detailed data on key routes and flows. The final chapter of the first section deals with refining and crude oil valuation, serving as a transition to the descriptions of individual crude oil streams in the second section. This handbook also contains numerous special features to keep up to date with new developments and efficiently present the information. In order to supplement the annual data and information presented here, PIW will send out four or five updates a year as they appear in our regular supplements on term crude oil prices (four) and term-contract sales (one). Any updates that have already been published can be found in the reference section. The need to constantly update information on such matters as crude oil streams and the individual marketing strategies of exporting countries means that the entire book is intended to be revised regularly and extensively every two years or so. The book has evolved rapidly into an independent source that is widely relied upon for basic data and information on the international crude oil trade. PIW is uniquely qualified to produce such a book, having tracked the crude oil market intensively from the origins of the spot market. PIW also brings to bear a worldwide information-gathering network that provides material known for its accuracy and relevance to the business decisions and needs of the international oil industry. The editors encourage an open dialogue with all users of this book and look forward to your comments and suggestions for incorporation into future editions.

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THE SPOT MARKET

The Revolutionary Impact Of Spot Trading


The growth of the international spot market in crude oil during the early 1980s revolutionized the way that petroleum is priced and turned much of the industry completely on its head. The ensuing transformation in the structure of oil markets forms the basis on which crude oil is priced internationally today. For nearly 15 years leading up to the mid-1980s, virtually all of the oil that changed hands around the world was sold under relatively strict price mechanisms managed by the governments of oil-exporting countries. That system called, alternatively, one of administered, government, or official selling prices had an inherent logic that convinced most participants that the methodology was fairly permanent. Its main features were simple: Governments of most of the largest oil-producing areas of the world felt during that era of resource nationalism that the determination of oil prices was an expression of national sovereignty. They, almost without exception, laid down the pricing basis, under which their oil was sold from their export terminals at an official price free on board (f.o.b.) a vessel loading oil a system that they had largely inherited from the major oil companies. To be sure, they had to take into account market forces, adjusting prices to one another and referring to global demand and supply patterns in a system described below. But within those narrow bounds, the administration of oil prices by governments was a basic fact of crude oil markets. In contrast to the complexity of todays market, the hallmark of oils old regime was simplicity, although its goal of stability remained elusive. There werent all that many participants supplying the market under the system of official selling prices. A handful of countries exported oil 13 eventually in Opec and less than half a dozen of any consequence outside that producer group: Mexico, Norway, the USSR, and the UK. Buying was dominated by the major international oil companies, with limited involvement by independent refiners, traders, and other intermediaries. As the spot market grew in prominence in the early 1980s, the radical change in crude oil pricing that accompanied it was the emergence of a market discovery system driven by marginal spot trading, which eventually replaced administered selling prices. The result is a system in which virtually all term-contract prices are tied directly or indirectly to price quotes from the spot crude oil market. The ascendance of spot market-based pricing, which is described in more detail below, was directly linked to the abrupt emergence of surplus global production capacity in the early 1980s as demand plunged due to high prices. At that time, Opec countries abandoned administered prices in their effort to compete with one another and with new market entrants in order to dispose of their production as the sellers market of the 1970s turned into the buyers market of the 1980s. Oil refiners and traders in turn pushed their suppliers to provide crude oil prices that would be profitable for them in terms of the current sales prices of refined products.

The Spot Markets Key Role


The size of the international crude oil spot market is extremely difficult to gauge, but its enormous influence and its significance for virtually all aspects of

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the oil business are unquestioned. While spot deals are estimated to account for only about one in three sales of physical crude oil, the prices generated by these transactions are now the primary determinant of almost all other world oil prices. This is most apparent in the formula pricing systems now used for the bulk of term crude oil sales by Opec producer countries. Formulas typically specify direct price linkages to particular spot crude oil quotes. Spot prices are also closely tracked by countries and companies that sell crude oil on the basis of postings or retrospective pricing arrangements. In todays market, crude oil sellers have little scope for deviating from the trends established by the spot market which comprises the trading of individual cargoes or partial shipments for immediate delivery, outside of any continuing supply commitment. Beyond their dominant role in international crude oil pricing, spot markets have a significant impact on everything from an oil companys share price to its investment plans. The spot market and closely linked futures trading are also used as the main barometers for measuring Opecs success at balancing global supply and demand. The stock-market values of oil companies that are heavily oriented toward the upstream sector have, since 1985-86, been closely linked to spot crude oil market trends, reflecting the vital importance of this single variable for some firms current cash flows and capital budgets. While oil companies tend to gear their long-term investment plans to future price expectations rather than to current market levels, it is

A Spot Market Daisy Chain


To illustrate the complexity of spot market transactions, a sample of an actual Brent crude market deal from the mid-1980s, when the market was expanding rapidly, is shown below. The daisy chain of forward and spot market transactions linked together 24 companies in 36 deals over a period of a few months. The cargo finally loaded at Sullom Voe in March 1984 and sailed to Suns refinery at Markus Hook, Pennsylvania.

BNOC Charter Phibro BP Acorn Gatoil Sun

Shell UK Pegasus Transworld Phibro Phibro Pecten Tricentrol

Idemitsu Occidental Acorn Acorn Transworld Itochu P&O Falco

Tricentrol Acorn Chevron Texaco Phibro Bomar Neste Sun

Sohio Shell Intl BP Phibro Transworld Phibro Bomar Ultramar

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also clear that spending plans are slowed or accelerated over the course of the year depending on the strength of current spot markets. Thats because they are used as a yardstick of a firms future cash flows, which are key determinants of capital investment expenditures. One of the distinguishing characteristics of the physical crude oil spot markets since the early 1980s has been their extreme volatility. Wide swings in prices have fostered the growth of large forward and futures markets and an array of risk-management tools that are effectively an extension of the physical spot market. The futures markets are dependent on the physical spot market in that they are linked to them at the point of delivery, but the two are constantly responding to each other and have grown mutually interlinked and dependent. The futures markets now trade oil volumes for future delivery that far overshadow the spot market. The New York and London crude oil futures exchanges together trade the equivalent of more than 150million barrels in each session, or more than double the volume of physical oil produced around the world daily.

How Big Is The Spot Market?


While the spot markets growth has been central to the transformation of crude oil trade over the last 10-15 years, no precise measure exists for its size. Thats because the number of companies involved in buying and selling the same cargo of crude oil before it reaches its final destination can often be quite large. One of the biggest problems is determining a particular point in the supply chain at which to measure the spot market. Cargoes of crude oil are sometimes resold in spot trade as US SPOT CRUDE IMPORTS US SPOT CRUDE OIL they move from the port of loadIMPORTS BY REGION BY REGION ing toward their final destination. 2.5 In the case of forward crude oil (In mill. b/d) markets such as those for North S. America 2.0 Sea Brent or Mideast Dubai N. America grades, long daisy chains of 1.5 physical transactions can result in the same cargo passing Mideast Europe 1.0 through many hands (see box, opposite page). Whats more, the market is not fully transparent, 0.5 Asia Africa since physical spot market transactions are often confidential 0.0 and lack any central clearing1987 1989 1991 1993 1995 house. Perhaps the best available data on the size of the international spot crude oil market come from the US Department of Energy, which receives regular mandated reports on transactions from companies importing crude oil into the country. Spot crude oil in the mid1990s has accounted for about one-third of such volumes, which represents a slight increase from the 30% of the late 1980s and early 1990s. These data can only be viewed as indicative of worldwide trends, but are probably fairly representative: The

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US is the largest crude oil importer in the world and draws on virtually all crude oil-producing regions to some extent. These US import data demonstrate that the market can grow and shrink in size quite dramatically depending on market conditions and seasonal factors. For example, spot transactions constituted over 35% of US imports in the summer of 1986, when oil markets crashed to below $10 a barrel. By early 1988, they represented less than 24% of US imports. But by 1995, spot volumes had climbed back up to 36%, exceeding their previous high point in 1986. The US data indicate that the spot market has been growing in recent years, both as a percentage of all transactions and in absolute terms. Much of this growth appears to have come from the Americas and, to a lesser extent, Africa, which seems to be the largest source of spot barrels to the US market (see graph,pB3). In fact, some 70% of US crude oil imports PROPORTION OF US CRUDE OIL IMPORTS from Africa, or 900,000 barON A SPOT BASIS BY REGION rels a day, were on a spot North South basis in 1995. Crude oil exYear Total Africa Asia Europe Mideast America America 1996* 33.4% 71.7% 37.0% 43.7% 13.3% 19.6% 36.0% porters in the Americas 1995 36.3 69.4 52.8 63.0 15.6 23.7 32.5 have provided most of the 1994 36.5 72.0 59.2 67.2 18.9 20.1 30.4 recent growth in US imports 1993 32.7 61.3 53.4 65.0 20.0 19.5 23.0 and much of this oil seems 1992 31.1 54.0 62.6 73.8 19.7 15.1 24.6 1991 29.9 46.3 64.4 63.9 24.4 15.9 26.1 to be on a spot basis, par1990 30.5 44.7 59.3 73.8 23.6 12.3 31.0 ticularly from Venezuela. 1989 32.2 54.0 59.7 55.2 25.8 9.6 29.9 While the Mideast remains 1988 25.8 39.2 41.2 62.6 21.2 9.7 23.5 1987 33.7 52.3 46.9 77.6 27.5 12.0 28.8 an important crude oil supplier to the US, total sales Total US Crude Oil Imports (Spot & Term) (In 1,000 b/d) are off and spot sales have 1995 6,532 1,312 115 472 1,418 2,274 1,340 dwindled to only about 15% *First quarter only. Source: US DOE. of the total, as Saudi termcontract supplies increasingly dominate this trade. In contrast to the overall trend, spot sales have declined slightly from Europe as contract sales have increased. Based on the US trends in spot trade described above, the total global spot market would seem to amount to 9- to 10-million barrels a day of the over 28-million b/d in world trade in 1995. This is based on a simple extrapolation of data from the BP Statistical Review, which would also suggest that Africa is the biggest spot market at 3-million b/d, the Mideast second at 2-million b/d, and Europe third at 1.5-million b/d.

Growth Of The Spot Market


The spot market became a dominant force in world oil trade only in the last 15 years or so. In the 1950s and 1960s, when the international majors in effect controlled world oil markets, spot crude oil transactions were widely regarded as peripheral and unrepresentative. Spot deals amounted to just a tiny fraction of total crude oil sales, with the market used mainly as a means of getting rid of odd lots or temporary surpluses. Prices were usually at a discount to term-contract levels, with little volatility. There were relatively few market participants, and there was little price transparency. By the early 1970s, the growing importance of US independent oil companies to international oil-production operations was providing an increased

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role for the physical spot crude oil market. The supply dislocations and price explosion created by the Arab oil embargo in 1973 gave further impetus to spot trade. But the spot market, although growing, was nevertheless relatively small compared to the huge volumes of oil still moving via the vertically integrated systems of major oil companies and their term-contract sales. The 1973-74 price explosion did, however, spawn or enlarge several specialized oil-trading and brokering companies that previously were mainly involved in the more active market for refined products, especially in Northwest Europe and the US East and Gulf Coasts. This provided middlemen and intermediaries that gave the spot market more participants and the potential for added liquidity. The key events that opened the way for the international spot crude oil market to play todays central role include the use of spot sales by Iran in 1973 that signaled higher Opec prices. This was then followed by the nationalization of oil companies upstream operations in producing countries. The change in ownership effectively broke the vertically integrated structure of the oil industry, creating a gap in the supply chain that was eventually filled largely by the spot market. With oil output now mostly in the hands of producing governments and the downstream refining and marketing operations still held by international oil firms, the potential for further supply dislocations was increased, creating new opportunities for oil traders. Initially, almost all of the oil continued to move in term contracts, but these were now open to a larger spectrum of companies, and spot market pressures soon became hard to resist. Meanwhile, in the US, the system of government price controls created incentives for increased spot trading. The next international oil crisis, sparked by the Iranian revolution in late 1978, put the spot crude oil market on center stage as the main barometer for rising international prices. The volume of spot transactions remained relatively small, at an estimated 5% of oil trade, but the markets influence was much greater. Many Opec producers raised the official prices of their term-contract sales faster than scheduled in an effort to catch up with spot market levels. They also auctioned cargoes on a spot basis and added premiums to their prices. These policies created a much closer and clearer linkage between the marginal or incremental spot barrel and baseload term-contract supplies a relationship that was to haunt these same Opec producers later in the 1980s. With hindsight, its obvious that the lesson here was that the spot market is always more attractive to the seller when prices are rising and to the buyer when they are falling. This truism is what ate away at the fixed-price system in the early 1980s.

Spot Markets Take Hold


After crude oil prices peaked at over $40 a barrel in early 1981, a long decline set in that was also led by the spot crude oil market. Producers inside and outside Opec tended to follow spot prices lower reluctantly, trying to preserve their control over the market. In order to maintain term-contract sales, the non-Opec producers were more responsive to downward spot market pressures, while the adjustments in Opec official prices came after long and often-painful negotiation. Opecs defense of higher official price levels, led by Saudi Arabia, meant a huge loss in term export sales as global demand fell and buyers turned increasingly to the rising supplies from cheaper non-Opec and spot market sources.

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Large volumes of Opec crude oil also leaked into the spot market through a variety of alternative marketing mechanisms at the lower price levels, boosting spot market volumes to over one-third of oil sales by the mid-1980s. Term crude oil supplies, with their fixed prices and volume commitments, were increasingly seen by oil companies as too risky in an environment of falling prices. At the same time, forward and futures markets were growing rapidly as oil-market participants struggled to cope with the risk created by price volatility. This also brought greater price transparency and placed further emphasis on the spot market. Oil-trading companies, too, were thriving on the volatility spawned by the breakdown of Opecs official pricing system. In a bid to regain lost market share and boost its revenue, Saudi Arabia abandoned both its Opec swing-supplier role and the official price system in late 1985, opting for direct linkage of its crude oil prices to spot product markets with netback pricing. Other Opec members quickly followed suit, and oil prices crashed. Spot markets led the plunge in oil prices in 1986, with large volumes continuing to trade on a spot basis despite the new netback sales contracts, which effectively gave refiners a guaranteed profit margin. This seemed to underscore the permanence of the spot markets new prominence and the difficulty that Opec and the oil companies would face if they tried to put the spot-market genie back in the bottle. While netback crude oil pricing was abandoned in early 1987 as Opec tried to reassert control over markets, this methodology did open the way for virtually all oil supplies to be linked eventually to marginal or incremental pricing. Netback pricing has a reputation for causing instability, in part because of the events of 1986. Nonetheless, the concept of linking crude oil prices to the values implied by product markets does make good economic sense. Opecs resurrection of fixed prices in 1987 quickly proved unworkable due to a rapid return to spot sales and other alternative marketing mechanisms. This time around, Saudi Arabia opted for a new market-linked pricing system tied to benchmark spot crude oils, with geographically specific formulas for different regions. This system is the main subject of Chapter C on term supplies. By the late 1980s, almost all internationally traded oil was priced on a marginal or incremental basis through some form of direct or indirect linkage to the spot market. Although this initially benefited buyers enormously, they soon found that it cut the other way with the Gulf war in late 1990. However, the system survived that crisis successfully, underscoring the broad acceptance of spot-linked pricing and the predominance of spot markets. In the autumn of 1990, anxiety over oil supplies due to anticipation of the Gulf war tightened spot markets, which briefly touched $40 a barrel. With baseload supplies tied to the spot market, term-contract prices followed suit, even though no genuine shortage of supply ulti mately developed in part because the impact of higher prices encouraged rising production.

What Makes A Benchmark Crude Oil


A crucial element in the development of the spot oil market in the late 1970s and early 1980s was the emergence of key benchmark grades. These grades served as the chief reference levels for crude oils of similar quality and in similar locations, providing a focus for increased trading and a rise in market liquidity. The first international spot market benchmark grades were Arabian Light in the Mideast (see pH227) and UK Forties in the North Sea (see pH247).

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The US market was only indirectly linked to international spot markets until 1981 due to the complexities created by Washingtons controls on crude oil prices. Arabian Light was a natural benchmark because of the prominent market role that it played in Opec as the key reference grade for the official price system, and because of its widespread usage by refiners in the US, Europe, and Asia. In fact, as the worlds top-volume crude oil from the largest crude oil producer and exporter, it would be a natural benchmark today if not for Saudi Arabias policy of suppressing spot trading of its crude oils. Forties served as a benchmark because of its robust volume, but it was replaced by Brent relatively quickly. The emergence of UK Brent as a North Sea reference crude oil (see pH241) in place of Forties in the early 1980s was no accident; it resulted from the grades mix of key characteristics. Ironically, Forties may again become the North Sea benchmark by the end of this decade because it is expected to embody these critical qualities better than Brent will. Brent currently possesses all of the vital criteria that spot market participants seek in a benchmark grade volume, security of supply, diversity of sellers, and broad acceptance. A significant volume of actual barrels is needed in order to provide liquidity to the physical spot market. After Brents liquidity was threatened by production problems in 1989, a commingling of the Brent and Ninian streams in 1990 helped to assure a large tradable volume. A diversity of sellers is also needed to prevent a single producer from having too much market power. This has been one of the main objections to Forties, which was previously dominated by British Petroleum. But rising production from a host of other producers feeding into the Forties system has made it a larger, more diversified stream, with output of 1-million b/d in 1996 versus about 775,000 b/d for Brent Blend. The final key characteristic is that the crude oil must be familiar to a wide array of refiners and welcome in their systems to assure easy market liquidity. As Riyadh suppressed spot trade in its oils, Dubai crude oil (see pH87) gradually displaced Arabian Light as the primary Mideast spot crude oil in the mid1980s, even though it does not fit the profile of the ideal benchmark grade nearly as well as Brent does. Market participants have worked hard to keep Dubai alive as a benchmark, and one of the main reasons for its success is the need for some Mideast spot price reference and for a heavier, high-sulfur spot benchmark grade in international trade. Dubais production is relatively small and declining, but it makes up for this in part by the fact that it is almost entirely spot-traded. US West Texas Intermediate became a benchmark spot crude oil almost by default (see pH257). In 1983, it was selected as the main reference grade for the New York Mercantile Exchanges new crude oil futures contract, which caught on quickly and has put a spotlight on WTI trading ever since. While not ideally suited as a world benchmark grade, mainly because of its landlocked delivery system and distance from international markets, its tremendous success highlights the crucial importance of liquidity in a successful trading grade. With the huge volume of the futures market behind it, WTI gained worldwide visibility. Benchmark grades are critical in defining the spot values of related crude oils, and they also have become the key price variables in many term-contract price formulas. In addition, they are the basis for most hedging and risk-management efforts and attract the bulk of speculative trading interest. All of this makes the benchmarks important, but they are all messy and flawed. Nevertheless, as in

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other commodity markets, nothing succeeds like success. There tends to be a selfsustaining quality to these benchmark grades, as their liquidity attracts other participants and further enhances their trading volume. The basic irony of all of them in economic terms is that they are providing the main marginal-pricing signals for the world oil industry, but they do not fully represent marginal supplies. Brent, Dubai, and West Texas Intermediate are all in the hands of producers that always produce as much oil as they can and have little flexibility to expand flows. The marginal supplies to the world market come mainly from producers in the Mideast Gulf, especially Saudi Arabia. But these countries have discouraged spot trading of their crude oils, preventing them from being used as benchmarks. However, both Brent and WTI are marginal in the sense that they are among the last barrels sold to refiners, and hence they reflect the immediate supply pressures that are facing buyers.

Multidimensional Benchmarks
Despite their imperfections, highly liquid and efficient markets for prompt and forward supplies have developed for the key international benchmark grades. They operate on at least two or three of the following four levels: on the spot market for immediately deliverable physical oil, on an informal paper forward market up to several months ahead of delivery, on organized exchanges for futures contracts, and on over-the-counter markets for customized price swaps and options. The financial derivatives such as swaps and over-the-counter options that reflect a fourth layer of trading are closely linked with futures plays. There is a synergy between these levels, and forward and futures prices converge with those for physical oil as their contracts near expiration. These forward and futures transactions interact with the spot sector to reflect changing market conditions, and they also serve to attract trading by companies handling similar grades or buying crude oil in the same region, because the forward and futures trading capabilities allow them to both take speculative positions and manage risk. The existence of these forward and futures markets in the benchmark crude oils not only attracts liquidity to the grades, but also makes the price signals that they provide extremely important. As well as providing vital indications of current market levels, the benchmark grades give readings on the changing value of future supplies, which fluctuate between trading at a premium or at a discount to spot barrels. The value of a benchmark crude oil in the future is based on a number of factors, among which are the cost of money, the current level of excess commercial inventory, the cost of storage, and the general outlook for future supplies. In markets where immediate barrels are in surplus and where traders anticipate that supplies will tighten over time, prompt crude oil tends to trade at a discount to future deliveries in a price structure referred to as contango. In markets where immediate supplies are restricted or it is perceived that more oil may later become available, spot prices carry a premium to forward values in a structure referred to as backwardation. Forward, futures, and swaps transactions are referred to as paper trading because they most often end in financial settlements between parties as opposed to physical delivery of oil. This aspect of trade enhances liquidity since participants can trade more oil than physically exists, providing more active markets and better price information, especially in futures markets. Organized exchanges serve as clearinghouses that guarantee the financial integrity of a wide range of buyers

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and sellers taking positions and making cash settlements. In forward markets, which operate informally, participants must provide their own protection from defaults and thus tend to be more selective about their activities. In the cases of both Brent and Dubai, the informal markets have sometimes suffered serious breakdowns, which are described below in the subsections on each individual benchmark grade.

Brent: The International Benchmark


Brent Blend stands alone among all crude oils as the chief international benchmark grade (see pH241). By virtue of its liquidity, visibility, and wide acceptance throughout the Atlantic Basin, its predominance has grown to the point that it is the primary reference for pricing more crude oil, both on a spot and term-contract basis, than any other grade of oil. Despite its central position, the market is not without its peculiarities, imperfections, and weaknesses. In the spot markets for European and African crude oils, virtually all trades are now conducted at a differential to Brent rather than at an outright price, as was the case until 1987 or so. Almost all other previously independent spot market reference points, such as Libyan Es Sider, Nigerian Bonny Light, or Russian Urals, have given way to direct Brent linkage (see pH153,H183,H221). This same trend is also true for the formula prices of term-contract supplies sold into Europe from almost any market in the world. Brent-linked pricing is also used for African crude oil sales to the US and other markets. Referring to the Brent market as a single entity is a convenience, but it is somewhat misleading. As mentioned above, Brent is a complex of three interrelated markets spot, forward, and futures each with different characteristics and functions. But with Brent, more than any other benchmark grade, none of the three parts of the triad is dominant: All are mutually dependent and could not exist or would be unrecognizably different without the others. This linkage is one of the weaknesses of the Brent market because troubles in one area, such as a squeeze or other price distortion, can feed into different market segments, but the ad hoc nature of the ties and the ability of the three markets to interact and evolve together is probably also one of its operational strengths. To get a complete picture of Brent, all three submarkets must be viewed together. One of the best illustrations of the linkages between the three sectors is in pricing, which shows the fragility and the specific roles of each one. In the spot market for physical Brent cargoes, which is known as dated Brent, prices are set at a differential to those in the forward market, which is known as 15-day Brent, instead of on an outright basis. But in the 15-day Brent market, spread trades rather than outright deals have also become dominant, and the most visible, immediate price signals come from the formal Brent futures market. Thus the futures arena is a key source of prices, with a constant interplay between the three determining the value of Brent. However, the connections are far from seamless, and the efficiency of the pricing system is partly a reflection of the constant efforts of market participants to overcome and adjust for these imperfections. The coexistence in Brent trade of the 15-day forward market and the formally organized futures market is an anomaly in a typical commodity market there would usually be one or the other, but not both. The reason that one has not driven out the other is that they meet the needs of participants for different types of Brent transactions. Many players in Brent participate in all three submarkets, and indeed, many of them

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set trading positions designed to capture profit opportunities resulting from the price differentials between the three sectors.

Dated Brent: The Spot Market Arena


A dated Brent deal is much like any other physical spot market transaction, with the buyer taking delivery of an actual cargo under set terms of time, price, and so forth. The main factors that distinguish the wet barrel market in Brent are its linkage to the forward and futures markets for paper barrels, and the widespread use of its prices as a reference point for other crude oil trade. An estimated 50%-60% of all Brent loading, or some 400,000-450,000 b/d, correlates to dated transactions, which involve a specific physical volume with a set three-day range of dates for loading hence the term dated Brent. Virtually all of the trading in these physical cargoes occurs in the few weeks immediately before they are loaded. Trading further in the future is handled by the forward, futures, and swaps markets; trading at the time of loading or afterward is rare except for some cargoes in transit to more distant markets, such as the US. The relatively high liquidity of dated Brent trade is vital to the smooth functioning of the more heavily traded forward and futures markets that are linked to it. Not surprisingly, the biggest sellers of dated Brent cargoes are traders and Wall Street financial institutions that have acquired barrels in the forward market but lack refining capacity. The biggest buyers are major oil companies with refining operations in Northwest Europe, but smaller refiners in the US and Europe are also active. Of the interlinked Brent markets, the dated sector is the most closely tied to the physical operations of the Brent production and loading system. It is highly vulnerable to dislocations in output, as seen, for example, in the accidents that plagued the Brent system in 1989-90. But those problems were overcome by the commingling of the Brent and Ninian crude oil streams in 1990, and the enthusiasm for Brent as a pricing benchmark has been maintained. Since dated Brent represents actual prompt supplies, it is generally the preferred price barometer for other spot transactions and for term price formulas, despite the fact that prices are set at a differential to forward Brent rather than on an outright basis. Dated Brent serves as a pricing benchmark for all European and African crude oil production as well as for term-contract sales of Mideast and other non-European crude oils into Europe. The UK tax regime has also provided an important prop to an active physical market in Brent over the years because producing companies can use the market to establish a lower, more advantageous price on their production for tax purposes. Known as tax-spinning, the practice is completely legal and has continued since the early 1980s, but it has become subject to tighter regulation and is not as prevalent as it once was. The government moved in late 1993 to limit the time allowed for companies to declare a sale valid for tax purposes to just 24 hours. Producing companies can still reduce their tax exposure by selling barrels into a falling market, even on such short notice. The practice is believed by many observers to add to downward pressure in a weak market and amplify upward pressure in a rising market. For now, a delicate balance exists between the government tax authorities and the UK producing companies. The government seeks to maximize its revenue without seriously undermining the level of trading in the widely relied upon dated Brent market, while oil companies seek to take as much advantage as they can of the tax law without sparking added government regulation.

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The biggest innovation in the Brent market in the 1990s has been the so-called CFD or contract for differences market, which in practice provides a direct link between the wet barrels of the spot market and paper barrels of the forwards and futures markets. The CFD market is described in more detail below, but its emergence has drawn increased attention to the pricing of dated Brent and the critical role played by price reporting services such as Platts and Petroleum Argus. These concerns about the accuracy of price reporting also relate to the declining production of Brent, which means that as spot market liquidity declines the reliability of the price signal from the market may wane, which could eventually undermine its benchmark role. With Brent Blend production expected to decline to about 400,000 b/d soon after 2000, the liquidity issue is likely to become increasingly important in the future.

15-Day Brent: An Elite Club


In contrast to the trade in physical cargoes, a transaction in the 15-day forward Brent market is a commitment to supply or lift Brent during a specified month in the future. As in a futures market, traders are exchanging promises rather than oil. The big differences between the forward and futures markets are the informality and the narrower group of participants in the 15-day market. Under the current rules of the Brent forward market, the seller must give the buyer 15 days clear notice of a three-day loading window for the cargo that is to wet the paper contract hence the name 15-day market. This means that the latest point at which a January forward Brent cargo can be sold is the middle of January, since 15 days notice cannot be given in the second half of the month. The loading procedures at the main terminal of Sullom Voe are one key factor influencing the structure of the 15-day market. Producing companies must nominate their preferred loading dates for the relevant month by the fifth of the preceding month and settle the whole months program by the 15th of the preceding month. Thus, a company wishing to sell forward cannot specify an actual range of delivery dates until the 15th of the previous month when the liftings schedule is made final. Delivery dates are set at the sellers discretion, and the general terms and conditions established by key Brent producer Royal Dutch/Shell are generally used by most parties. The 15-day Brent market trades as much as three to four months ahead of the date of loading, although one-month forward tends to be the contract with the most liquidity. Contracts are negotiated directly between parties for 500,000 barrel cargoes, but a customary 5% volume tolerance has created opportunities for sharp trading practices that some key players, such as Shell, have tried to limit. However, the ability to benefit from volume tolerances also is an attraction to many traders and thus a source of market liquidity. The large transaction size together with creditworthiness and a reputation for reliability are key concerns that limit the number of participants. These worries have grown following serious defaults that have at times gripped the market. The number of firms in the 15-day market has declined significantly since 1986-88, and the types of enterprises involved have changed markedly over time. About 100 companies are estimated to have been active in the market in the mid-1980s, but this declined to 50-60 in the early 1990s. Among the main shifts in participation, Japanese trading houses which were quite active in the 1980s have dropped out almost completely, while Wall Street financial institutions and commodities houses have become much more active. The 15-day market is dominated by the Wall Street-type firms

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THE CLUB: TOP 10 PARTICIPANTS IN 15-DAY BRENT


Rank 1 2 3 4 5 6 7 8 9 10 1986 Company % Share Phibro 8.7% J. Aron 7.4 Nissho Iwai 6.1 Shell UK 5.5 Drexel 4.3 Marubeni 4.2 BP 3.6 InterNorth 3.5 Shell Intl. 3.3 Kanematsu 2.9 Total 49.5 1991 Company % Share J. Aron 15.8% Phibro 10.6 Cargill 5.9 Shell Intl. 5.8 Total 5.4 BP 5.0 Statoil 4.7 Morgan Stanley 4.3 Hess 3.4 Marc Rich 3.4 64.3 1993 Company % Share J.Aron 12.0% BP 9.5 Koch 7.6 Phibro 5.9 Shell Intl. 5.8 Shell UK 5.5 Elf 5.5 Cargill 4.8 Dreyfus 4.7 Morgan Stanley 4.3 65.6 1995 Company % Share J.P. Morgan 13.8% Phibro 11.7 BP 9.3 J. Aron 8.4 Statoil 5.8 Elf 5.0 Morgan Stanley 4.8 Shell Intl. 4.8 Koch 4.4 Shell UK 4.2 72.3

Note: 1995 data are for first six months. Source: Derived from Petroleum Argus Crude Oil Deals Database by Oxford Institute For Energy Studies.

and the producers of Brent Blend, according to the Petroleum Argus Crude Oil Deals Database. The table above, which was derived from the database, shows the top 10 participants in 1986, 1991, 1993, and 1995. The market has become progressively more concentrated in the hands of the largest players, with the top 10 firms accounting for over 70% of trading as smaller participants have moved over to the futures market. As an informal market, 15-day Brent has no central clearinghouse and no process under which various buy and sell positions are rationalized at the end of each day to determine what each participants open commitments are. Instead, a network of loose chains of obligations exists, which take final form only as physical cargoes are sold into the dated Brent market, effectively wetting the chains. When a producer serves the first buyer with notice of the loading dates for a physical cargo, that buyer has the choice of taking delivery of the oil or passing the notice on to a second company to which it has a sales commitment in the forward market. A single physical cargo typically moves through a daisy chain of buyers and sellers until it reaches a party that either wants to take the oil or simply has no alternative but to do so because of its trading position (see chart, pB2). This process occurs in the period between the time that the loading schedule is set and the time that the 15-day notice of physical loading must be received. When chains are long, or if a participant is slow in responding, a purchaser that did not intend to take delivery may receive notice of a cargo at the last possible moment, at 5 p.m. London time, 15 days before the cargos three-day loading window. This is known as being five oclocked or clocked, and it is not looked upon kindly. The number of clockings is often viewed as an indicator of market sentiment. If clockings increase, this is a sign of a reluctance to take cargoes and of possible price weakness, while a decline in clockings is viewed as the opposite. The course of a chain is not predetermined, and sometimes the producer that provides the first cargo can also wind up being the one taking delivery at the end of the same chain. Parties can also opt to settle a Brent chain or a part of it in a financial transaction before the date on which delivery notices would be served. In this so-called book-out process, a seller tries to identify other parties in a potential chain that might all be willing to cancel out their respective obligations on paper. A cash settlement is then

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made between parties in the chain for the difference between their transaction prices. Informality brings both risks and advantages for participants in the 15-day Brent market. The system of daisy chains means that all participants are vulnerable to a default by any individual firm in the chain and explains the restrictive nature of the group and the concern for creditworthiness among participants. But this risk is counterbalanced by the advantage of the 500,000 barrel contract size, which allows a firm to quickly build or dissolve a large market position. The absence of a clearinghouse also means that participants need not make potentially costly margin payments to maintain a position, as is the case in the futures market. The focus of trading in the 15-day market is divided between outright deals and spread trading. In the latter, participants trade two counterbalancing positions between two grades of oil or between different time periods for Brent delivery. Outright deals are primarily the province of Brent producers. As of the early 1990s, the percentage of outright 15-day Brent trades had fallen to just over 20% of all transactions, compared with about two-thirds in the 1986-87 period, but outright trades had climbed back to about 50% of the total in 1995. The larger proportion of outright deals emphasizes the markets continuing importance for tax optimization purposes. The popularity of spread trading reflects a general strategy for minimizing the risks of price volatility, the interlinkage of markets through arbitrage, and the widespread use of price differentials for most trading.

Brent Futures: The Price Barometer


After two unsuccessful attempts, Londons International Petroleum Exchange finally scored with a viable Brent futures contract in the summer of 1988. This formal market for futures supplies involves cash settlement rather than physical delivery, with prices from the 15-day market used to determine the final value for the contract when trading closes out. In practice, this means that the prompt price in the Brent futures market actually represents the value of the oil as much as a month and a half before physical delivery. While this is an unusual structure for a futures market which typically ties directly into physical spot markets and thus might seem to limit its usefulness, the structure actually makes the futures market a natural complement to the 15-day market. It allows for easy trading of the much-smaller 1,000 barrel lots of the futures market and it also permits smaller companies that lack adequate credit or that do not need the large trading lots of the 15-day market to hedge and speculate on future price trends. The level of regulation that is standard in futures markets also removes the risks of default that exist in the less formal 15-day market. Futures market participants can also achieve physical delivery by an off-exchange process known as EFPs, or exchanges of futures for physicals, in which two parties agree to swap their respective futures market positions for crude oil supplies. In addition to providing an added dimension to the 15-day Brent market for the trading of smaller volumes by secondary participants, the futures market has emerged as the key tool of price discovery. The convergence between futures prices and the 15-day market is strong due to the futures contract-settlement mechanism. The liquidity and small contract size of the futures market also facilitate trading and have made the IPE a key nerve center, providing a constant indicator of the value of oil for the same period being traded in the 15-day market. In effect, the IPE has displaced the need for intraday price quotes in the 15-day market

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by providing a clearly visible price that informs both the trading in the 15-day market and transactions in the dated Brent market. The duality between prices in the futures market and those in the 15-day market is not perfect, however. In a rising market, for instance, the opportunity to use the volume tolerance, with the buyer using his right to insist on an additional 5%, or an extra 25,000 barrels, adds value to a cargo relative to the futures and 15-day price. The reverse may happen in a falling market. In periods of extreme tightness or anxiety about physical supplies, such as during the Gulf war, the 15-day market has tended to trade at a premium to IPE futures. The reason is that the forward market represents a contract commitment for a physical cargo which is more useful to a refiner in a supply crisis while the futures market relies on cash settlement. On the other hand, for much of 1996, dated Brent traded at a discount to 15-day prices despite the overall rise in market levels. The futures market represents a broader range of participants than either the 15-day or the dated Brent market, but it draws heavily on both. In addition, North Sea producers of smaller, non-Brent crude oil streams and European refiners are particularly active. The majority of participation in IPE futures contracts is from Europeanbased companies, but the broader international focus of the Brent contract probably pulls in increasing non-European trading. The IPE has promoted trading of the contract on the Singapore Monetary Exchange and has also successfully introduced options on its Brent crude oil futures contract.

CFDs: Brents Bridge Between Spot And Forward Trade


An important new hedging mechanism has developed in the Brent market since the early 1990s that goes beyond those available from either the 15-day market or IPE futures. This so-called CFD market allows participants to cover the price risk associated with a specific date range for physical loading. In essence, it acts as a bridge between the 15-day, or forward market, and the dated Brent spot market, and as such provides a critical fourth leg to the Brent market complex. CFDs are essentially extremely short-term price swaps, but like dated Brent transactions, they are priced at a differential to the forward Brent market. The transactions are designed to provide price insurance in the period of two to six weeks between the time that a 15-day forward Brent cargo becomes wet and the time that it loads. The main benefit of CFDs to both buyers and sellers is that they lock in a price and reduce potential exposure to risk in the dated Brent market, effectively providing the kind of protection for dated Brent that already exists for future supplies through the 15-day market. The CFD market has grown rapidly since about 1993 and trading volumes as of 1996 were significantly larger than for dated Brent itself. About 90% of the trades in CFDs are by firms that are active in both the dated and 15-day markets. This group of about 30 consists of large North Sea producers, Wall Street firms, and oil traders. Like the spot and forward markets, it attracts active interest from both hedgers and speculators. In 1995, CFD trading volume was about twice as large as dated Brent activity, according to Petroleum Argus data, which would indicate that the market has become mature and well-established. While CFDs would seem to be a perfect complement to the other Brent markets, these derivatives have come under criticism as a vehicle for market squeezes and as a source of price volatility. While there is evidence of both of these trends in relation to CFDs, the criticism is largely a case of blaming the

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messenger. The Brent market seems to be adjusting to the new member of the family fairly well, with fewer signs of problems in 1996. The emergence of CFDs coincided with a period of great volatility in the spread between the dated and 15-day prices. While the CFD market is meant to hedge that risk, it also may have prompted increased efforts to manipulate price quotes for dated Brent. It also seems to have contributed to squeezes in the forward market, because it provides a way for the initiator of a squeeze to make a profit unwinding the long position that has been created in the forward market by taking offsetting positions in CFDs before the squeeze gets going. These issues have been examined closely by the Oxford Institute for Energy Studies in their continuing analysis of the Brent market.

West Texas Intermediate: Improbable Price Leader


One of the greatest ironies of the world oil market is that the most visible, highly traded crude oil in the world is West Texas Intermediate a landlocked US domestic grade that never appears on the world market and only competes with internationally traded crude oils when they are imported into the US (see pH257). WTI owes its prominence to the fact that it is the main grade used in the New York Mercantile Exchanges light, sweet crude oil futures contract. Riding the huge volume of Nymex futures, WTI is a highly visible reference point that equals or exceeds UK Brent grade in importance, depending on ones location around the globe. WTI was chosen as the primary crude oil for the Nymex futures contract back in the early 1980s, mainly for operational reasons. Unlike the large cargo volumes of the international spot market, WTIs pipeline-based transportation network allows for the movement of the relatively small volumes that match the physical delivery needs of a futures market in the early development phase of a new contract. However, these operationally driven decisions aimed at launching a successful crude oil contract in 1983 despite an oil industry that was still quite skeptical about futures resulted less than a decade later in the emergence of an improbable global price leader, full of complexities and obvious imperfections. The Nymex crude oil futures contract itself trades 1,000 barrel lots of WTI-type crude oil for delivery at the Cushing, Oklahoma, pipeline hub. Despite its unambiguous US orientation and several other flaws that are described below, WTIs ability to assume a global benchmark role underscores the importance of futures trading in the international oil industry. With daily futures volume in the Nymex light crude oil contract averaging the equivalent of 100-million b/d, the WTI market is effectively more than twice the size of that for Brent futures, which itself is about two to three times as large as the 15-day Brent market in total volume, by most estimates. The main importance of this huge volume is that it provides immediate price transparency and an arena for all global market participants to react to the latest trends. Partly with this role in mind, Nymex launched a 24-hour electronic trading system in 1993 that allows interested buyers and sellers to continue trading after exchange hours, except on weekends and holidays. WTIs central price role is reflected in the fact that most trading of Brent and other international spot grades occurs during the hours of the Nymex session, with even the IPE futures market adjusting its hours and staying open late in order to overlap with Nymex. However, without the bright light that shines on it from the Nymex futures contract, there is no doubt that WTI would go largely unnoticed, like most other US domestic grades. The crude oils benchmark status is derived from its use in the

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worlds biggest oil futures market, and not from its physical characteristics, which significantly inhibit its usefulness. To overcome some of these inherent constraints, Nymex actually allows a wide range of both domestic and international crude oils to be delivered against the contract, although in practice most deliveries that are processed by the exchange itself are for WTI. Significant volumes of other crude oils are delivered under exchanges of futures for physicals (EFPs), special offexchange mechanisms between consenting buyers and sellers, but these individualized transactions do not have to track the physical market as closely as formal deliveries through the exchange, which are meant to provide a physical link for futures prices. Six US crude oils in addition to WTI can be delivered along with four international grades Brent Blend and Forties of the UK, Norwegian Oseberg (see pH203), and Nigerian Bonny Light. Until 1990, Norwegian Ekofisk, Nigerian Brass River, and Algerian Saharan Blend and Zarzaitine were also deliverable, but they were removed following complaints from Midcontinent US refiners that received some of these crude oils unexpectedly (see pH197,H187,H29,H31).

Ambivalence Toward WTI


Although Nymex crude oil futures are now the exclusive benchmark for spot crude oil trading in the Americas and they are the pricing base, either directly or indirectly, for almost all US and Canadian crude oil sales, much suspicion remains about WTI as a benchmark in the broader international arena. This ambivalence persists even following the switch to WTI-linked formula pricing by Saudi Arabia and others for their US sales as the usefulness of Alaskan North Slope as a benchmark diminished (see pH251). The past problems of ANS are explained below, but the emergence of new sour crude oil production streams from the US Gulf Coast such as Mars Blend (see pH255) raises the possibility of a new sour crude oil marker grade that could overcome the quality and location limitations of WTI. Much of the ambivalence toward WTI is well justified. US restrictions on exports and the structure of the domestic market prevent it from being traded internationally, making its links to the global market tenuous at times. The domestic US

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orientation of its market have resulted in several extended periods in which prices have become virtually disconnected from international market trends. While WTI competes directly with foreign crude oil supplies at refineries from the Gulf Coast to Chicago, pipeline constraints and internal market pressures inevitably create distorted price relationships at times. These discontinuities with the international market and the reasons for them can easily be seen from a brief description of the physical characteristics of trading. WTI production is in decline along with the rest of total US crude oil output. Under a broad definition, flows of WTI in 1995 were just over 800,000 b/d, versus 1.36-million b/d in 1985, and they are expected to reach less than 750,000 b/d by 1998. This decline in the face of gradually rising US oil demand has meant that over the years, a larger proportion of the crude oil is being used in the Midcontinent region and fed by pipeline into the Great Lakes region, and less of it is shipped down to the US Gulf Coast refining center, where it competes more directly with international supplies. The primary influence on the physical market for WTI crude oil is the demand from refiners in Oklahoma and Kansas and along the pipelines extending up to Chicago and beyond. The pipeline system itself also creates a series of special constraints related to its capacity and storage at various points. The spot market for WTI is in practice split in two. One center of activity is in Cushing, Oklahoma, where the trading of supplies for the Midcontinent and Nymex futures contract deliveries occur. This crude oil moves to inland refiners. The other center lies in Midland, Texas, a hub where WTI supplies can be shipped either to Cushing or to the Gulf Coast. Price fluctuations between the two centers reflect differing market pressures, which can be extreme. Spot prices are WTI-BRENT SPREAD, 1987-96 quoted in both of these markets and the gap between them deviates considerably +3.00 $/bbl from the 26 a barrel that it costs to move +2.50 a barrel of WTI eastward from Midland to Cushing. When the Midcontinent market +2.00 is tight, the Cushing spot market trades at +1.50 a wider premium, and this is reflected in futures prices, especially for prompt sup+1.00 plies. However, if the Gulf Coast market is tighter, the Cushing premium drops +0.50 below 20, and Midland can even trade 0.00 at a higher level than Cushing in a period of extreme tightness at the Gulf Coast. -0.50 Pipeline capacity constraints mean that it 1/87 1/90 1/93 1/96 can take weeks for such imbalances to work themselves out, with supplies shifting as rapidly as possible to the market where supply is tightest. It costs 30 to move a barrel of crude oil from Midland down to the Houston area. Several pipeline routes allow international crude oils to be delivered to the central region of the US, but only two systems with combined capacity of about 500,000 b/d reach the key Nymex hub of Cushing, Oklahoma. These links complete the supply picture, which created a serious supply constraint on the Cushing hub until the more than doubling of the system with the addition of a

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new 270,000 b/d Arco leg in the spring of 1996. The expansion should help improve the linkage between WTI prices and the international market, by allowing ample international supplies to flow to Cushing in periods of tightness in the US Midcontinent and Great Lakes regions. The Arco Seaway network has two lines that can now carry up to 430,000 b/d, following the conversion of a gas line WTI AND BRENT FUTURES COMPARED* from Freeport, Texas, and the augOpen Interest Volume Month Nymex IPE Nymex IPE mentation of the existing 160,000 Sept. 96 56,691 36,898 39,144 26,026 b/d line. A separate Texaco line Oct. 96 60,917 59,409 24,972 20,809 can carry about 70,000 b/d. Both Nov. 96 33,365 10,869 9,160 4,301 systems carry domestic and interDec. 96 41,627 17,773 9,260 6,997 Jan. 97 29,201 11,945 3,364 3,799 national crude oils, and throughput Feb. 97 20,775 7,345 1,463 1,828 can be lower with heavier grades. March 97 13,589 5,996 750 1,030 Moving a barrel of crude oil from April 97 10,915 4,441 1,229 0 May 97 6,155 1,549 728 0 the Gulf Coast to Cushing costs June 97 23,119 4,405 2,020 100 about 75 a barrel, which means July 97 7,834 680 150 0 that a big premium must exist at Aug. 97 3,703 135 50 0 Cushing to pull in foreign supplies. Sept. 97 5,065 ... 504 ... Oct. 97 2,254 ... 0 ... At times in the past, WTI Nov. 97 5,683 ... 0 ... prices at Cushing have departed Dec. 97 20,006 ... 1,048 ... from their typical international Jan. 98 6,198 ... 100 ... market-reference points because Feb. 98 1,912 ... 0 ... March 98 1,571 ... 0 ... of these rigidities. From 1987-91, April 98 507 ... 0 ... prices were particularly volatile, May 98 367 ... 0 ... and other periods in which the June 98 5,965 ... 16 ... July 98 955 ... 0 ... spread widened to well over Aug. 98 89 ... 0 ... $1.50 a barrel have occurred in Sept. 98 420 ... 0 ... 1994 and 1996, indicating a Oct. 98 21 ... 0 ... break with international price Nov. 98 121 ... 0 ... Dec. 98 6,712 ... 1 ... patterns (see chart on pB17). The Jan. 99 0 ... 0 ... tightness in WTI is often due to low Feb. 99 0 ... 0 ... stocks of crude oil or gasoline in the June 99 753 ... 0 ... Dec. 99 6,251 ... 1 ... central region of the US. The comTotal 372,709 161,445 93,915 64,890 bination of expanded pipeline *Figures from Aug. 1996. capacity from the Gulf Coast to Cushing, greater reliance on Canadian crude oil imports and better anticipation of such pressures by refiners seems likely to make the discontinuities less frequent, but they are unlikely to disappear completely.

WTI: The Financial Benchmark


Even with the limitations of its underlying physical market, the high volume of futures activity in WTI has pushed it into the position of a leading financial benchmark for both futures and swaps markets. If the evolving markets in distant forward months are able to provide the oil industry with a clearer picture of the long-term value of oil, this signal is likely to come either directly or indirectly from WTI. The Nymex futures contract already has been extended three and one-half years into the future. The relatively robust levels of open interest trading positions that

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have not been offset and active trading in these distant forward months mainly reflects the use of the market as a place for providers of price swaps and other long-term forward market price-hedging mechanisms to manage the risk that they have taken on. Many of the concerns about the complex WTI delivery system and its rigidities tend to fade away in the forward months and are deemed to be of little importance. In sharp contrast to Brent futures, which are dominated by oil companies and traders that are active in the physical market, the WTI market is much more a mix of physical oil-market participants and financial players, some of which never trade wet barrels. Commodity funds and other financial entities tend to play a bigger role in the WTI market, providing a significant amount of the liquidity in the futures market. Unlike Brent futures, where over 65% of open interest is for contracts expiring over the following three months, WTI futures only have about 40% of their open interest in this heavily traded period. The table on pB18 compares the open interest and trading volumes in the Nymex and IPE crude oil futures contracts on August 13, 1996, underscoring the different profiles of the two markets. Although IPE has followed Nymexs lead by extending trading to 12 months, market activity in Brent futures is not nearly as great in the so-called outer months. Nevertheless, both contracts see about 75%80% of their trading volume in the nearest three months. The IPE plans to extend Brent trading out to 30 months in 1997.

Different Personalities Of WTI And Brent


The heavy financial orientation of WTI trading contrasts with the physical grounding of Brent trading in the day-to-day pressures of supply and demand in the international market. This basic difference in personalities between the two markets seems to have helped make them complementary and interdependent rather than competitive. While the WTI market provides a highly visible pricing barometer that attracts widespread and immediate reaction to market developments, the close physical linkage of Brent to the international market provides a reality check for WTI. Because of WTIs visibility and liquidity, most other crude oil markets prefer, as they trade, to have the extra comfort of knowing how the WTI market is reacting to psychological factors, financial pressures, and technical influences. However, the Brent market gives out important counterbalancing signals on the physical supply/demand pressures of both the European and broader international crude oil market that WTI traders cannot usually afford to ignore for long. The two markets interact constantly with each other in a tension that reflects their own inherent concerns and mix of participants. Neither one can fully represent the global crude oil market on its own. However, the tendency for WTI to be pulled away at times by internal US supply and demand pressures from international market influences means that the interaction between the WTI and Brent markets is imperfect and unpredictable. The two benchmarks tend to move in tandem most of the time, but signals can also become crossed and confused. It is at these times that the Brent market most clearly demonstrates its key international role.

Dubai: A Benchmark In Limbo


Although Dubai crude oil stands alone as the only actively traded spot and forward benchmark for the Mideast and for high-sulfur crude oil in general making it the key pricing marker for both spot and term-contract sales East of Suez it has some serious problems. Some of the critical trading issues of the early

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1990s have been overcome, but the crude oil stream faces a decline in production that seems likely to undermine the liquidity of spot trading in the future. Superficially, the Dubai trade appears to resemble Brents, but in many respects, it is more fragile. However, the lack of a viable alternative may well allow the Dubai market to persist despite these problems. One example of Dubais peculiarities as a benchmark is that it is only indirectly linked to Mideast and Asian spot crude oil pricing. Unlike Atlantic Basin spot crude oils, which are priced directly off a differential to UK Brent or US WTI, Mideast and Asian spot prices for the most heavily traded grades are based mainly on their retrospective term-contract prices. Spot levels are usually tied to the respective government-set retroactive monthly prices for the crude oil in question, whether the oil is from Abu Dhabi, Indonesia, or Oman. Dubai prices provide a key ingredient in setting these retroactive prices, but relatively little spot trading is done on a direct differential to daily Dubai prices, unlike Brent and WTI. However, Dubai, by virtue of its spot and forward market, is considered a key indicator of sour crude oil values. The monthly average price is also the basic ingredient in term-contract price formulas for the East of Suez sales by key producers such as Saudi Arabia, Iran, and Kuwait. Dubai emerged as an important spot crude oil benchmark grade in the mid1980s. At that time, third-party trading in Saudi Arabian Light and other regional grades wound down as key Opec producers sought to defend prices by limiting spot trade in their crude oils. The forward Dubai market grew up in conjunction with spot trading, but it has never extended for more than a few months in advance. The fact that the oil is produced and sold by Western oil companies has also been critical to the markets development. Production is divided between the producers US Conoco (30%), French Total (25%), Spanish Repsol (25%), German RWE-DEA (10%), US Sun (5%), and German Wintershall (5%) and the ruler of Dubai, making for a diverse group of companies to wet the forward market and reducing the chance of a squeeze. The rulers share is usually sold either directly into the spot market or to Western oil companies that resell the oil. Since all of the equity producers have their refining capacity in the Atlantic Basin, far from the region, this has provided an additional incentive for them to sell their crude oil on a spot basis. In the mid-1980s, Japanese trading houses provided much of the liquidity in the forward market and much of the oil also went to Japan. As they withdrew later in the decade due to trading losses, Wall Street financial firms largely took their place. Major oil companies and traders provide most of the other participation.

Threats To Dubais Liquidity


The Dubai market faced some serious operational problems in 1993, which created a temporary loss of confidence in the forward contract-delivery mechanism that has since been overcome. But the steady decline in Dubai production means that even todays active spot and forward trade relies on a smaller base of physical barrels, leaving the market more prone to distortion. The terms and conditions of the forward contract were revised in late 1993 by the operator, US Conoco, resolving most of the problems by tightening the rules for the selection of loading dates and other adjustments. These reforms restored confidence in the physical market and have helped foster a resurgence in trade, which has been also helped by renewed interest in trading price spreads between Brent and Dubai. There are, however, rumblings about Dubais continu-

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ing suitability as a benchmark. Trade is almost exclusively limited to a handful of companies that are sometimes suspected of manipulating prices and spreads with Brent. The emergence of short-term swaps in Dubai may have contributed to this kind of trading. Dubai output dropped to less than 300,000 b/d in late 1995 as part of a longterm decline that is gradually reducing the number of available spot cargoes, but the market has responded to this threat to liquidity in recent years with the growth of trading in partial cargoes. While Dubais usual cargo size, like Brent, is 500,000 barrels, which facilitates spread trading, an active market in partial cargoes down to 100,000 barrels has sprung up. This partial Dubai market is one of the reasons that past attempts to launch a formal Dubai futures contract in both Singapore and London have failed. At the mid-1996 rate of 270,000 b/d, there are, at most, 16 cargoes that can be traded in a month. This compares with output of over 400,000 b/d, or 25 cargoes, in 1990. Although the output decline eats into overall potential trading volume, notably in the wet barrel spot market, it is not clear at what point a spot market becomes too small to support a viable benchmark role, especially if it has close links to a more active market such as Brent, as Dubai does. For example, the US Alaskan North Slope market had managed to cling to a benchmark role on trade of just a handful of cargoes per month. Another key change in the Dubai forward market in the late 1980s was the shift in trading from outright transactions to spread trading, primarily off 15-day Brent. Spread trades, which involve two simultaneous transactions with the same party which partly offset each other, now account for an estimated 95% of deals, with a big jump during the Gulf war that has not been reversed since then. This change means that, in practice, Dubai has evolved into more of an extension of Brent trading than a market that stands on its own. While price-reporting services can readily determine the value of Dubai from the regular volume of spread trades versus Brent, there is relatively little outright trading activity to provide a counterbalancing check linked exclusively to the supply and demand pressures of Dubai itself. The volume of trading in the physical spot market for Dubai has also declined with the drop in production and the problems with the forward contract, making the market more dependent on the Brent link.

Dubais Divided Loyalties


Unlike trading in both Brent and WTI, where there is a considerable overlap between participants in the forward markets and those that produce and use the crude oil in refineries, these two groups are quite different in the Dubai market. The main participants in the forward markets are Wall Street financial institutions, equity producers in Dubai, and other Western oil companies and traders. But the main customers are refineries in the Indian subcontinent, Singapore, Japan, and South Africa. Aside from some of the international majors that supply their operations in both Singapore and South Africa from the Dubai market, there is little activity among the regional end-users of Dubai crude oil in the forward market even the international majors are not dominant participants. Similarly, Dubai is rarely taken into the Atlantic Basin, and when it is, sales are not usually on a spot basis. Usually, an equity producer will simply move one of its cargoes to the Mediterranean. While the Brent linkage in Dubai trading and its declining liquidity call into question its viability and validity as a benchmark, it also has a good chance of enduring. The simple fact is that there is no alternative to it anywhere in the region, and none seems likely to emerge, barring a radical change in the mar-

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keting policies of Mideast producers. The Southeast Asian crude oil market suffers from an even greater shortage of marker grades, and even if a new sour crude oil market emerged in the Atlantic Basin, it would be hard for it to provide a relevant price signal for the geographically disparate Asia-Pacific region. The participants in BRENT-DUBAI SPREAD, 1987-96 the market are likely to continue working hard to prevail over Dubais draw+4.50 backs. If the Mideast producers were $/bbl +4.00 willing to overcome their deep-seated +3.50 suspicions of allowing their crude oils to be traded freely in the spot market, a +3.00 more natural and solidly based marker +2.50 might quickly emerge based on Arabian +2.00 Light, the worlds largest crude oil +1.50 stream but there is no sign of such a change of policy. The only other alter+1.00 Gulf War native might be a more dominant +0.50 benchmark role for Oman crude oil (see 0.00 pH211), which in contrast to Dubai is 1/87 1/90 1/93 1/96 growing in volume. Although Oman plays something of a marker role already, there are fewer sellers and its current pricing system is heavily dependent on the governments retrospective posting, which in turn is linked to Dubai. Despite its limitations and potential pitfalls, Dubai provides a vital price signal for sour crude oils. In fact, the Brent-Dubai price spread is among the most important in international crude oil trade because it provides a clear indication of the relative values of light, sweet and heavy, sour crude oils. The spread has been volatile at times, but it has also clearly reflected the shifts in relative crude oil values in recent years. In the early 1990s, the gap was $2-$3 a barrel, but with the tightening of sour crude oil markets in late 1993 and early 1994, the spread dropped abruptly. New refinery investments in upgrading capacity, higher North Sea production, and cutbacks in Saudi sales of heavy crude oils all contributed to this shift that was clearly reflected in Dubai prices (see chart above).

Other Benchmarks And Their Limitations


Several other crude oils have emerged as benchmark grades for spot trading over the years and some new candidates are on the horizon. While some grades have foundered and others may still flourish, the dominance of Brent and WTI as the main sources of price formation for international oil markets has tended to overshadow the other markers, and it has made it harder for them to develop into independent markets. The region where the absence of a clear, unambiguous benchmark grade is most striking is the Asia-Pacific area. While Malaysian Tapis and Indonesian Minas crude oils partly play this role, neither is up to the job (see pH169,H125). Part of the problem in the Asia-Pacific region is structural. Due to the profusion of crude oils and relatively small volumes of production and spot sales, there are few grades that are large enough or traded widely enough to form the basis for a benchmark grade. The thin trade has resulted in a preference for pricing spot deals

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off the retroactive term-contract prices set by local producing governments, much as it occurs in the Mideast. These prices are usually set on the basis of a formula or some other indirect linkage to the most widely respected regional crude oil price reporting service, the Asian Petroleum Price Index. This service uses weekly assessments by a panel of market participants rather than traditional daily price reporting by journalists. The spot prices of Indonesian crude oils are linked to the governments Indonesian Crude Price formulas, which are drawn in part from APPI price quotes. Malaysian term-contract prices are based on formulas that rely partly on APPI quotes, and China and Vietnam also rely on APPI prices to determine their term-contract prices. The Tapis crude oil market is made up of two separate parts price swaps and spot trading which dont overlap but provide some of the most visible price signals in the region. Tapis, however, lacks a broad diversity of suppliers that can guarantee liquidity. Malaysias state Petronas is a regular seller of spot Tapis, usually providing at least a couple of cargoes a month for spot trading. But this represents a decline of about 50% from volumes in the early 1990s. Petronas now uses about half of its 210,000 b/d share of output in domestic refineries. Most of the swaps activity is carried out by Wall Street-type financial firms with regional producers and refiners. Unlike a forward market, the swaps lack a formal contract and they never result in physical delivery, but they provide much of the same access to hedging and speculation. While there is some linkage of prices for similar Asian light, sweet crude oils to Tapis spot quotes and while Tapis regularly trades on an outright-pricing basis rather than at a differential to some other grade, it is still flawed as a marker. Since all production is in the hands of state Petronas and operator Exxon, there is not a wide enough group of suppliers to insure against a price squeeze in any given month. Indonesian Minas crude oil is a more logical Asia-Pacific benchmark grade than Tapis, as it is the regions largest volume crude oil and falls midway in quality terms between the light and heavy grades that are produced there. Minas is traded regularly in the spot market although probably not quite as much as Tapis but it too is subject to serious liquidity problems that make it an ineffective benchmark. Like Tapis, production of Minas is in the hands of only two producers: US Caltex and Indonesian state Pertamina. In addition, Minas has tended to be one of the grades that Indonesia, as an Opec member, has traditionally relied upon when it has cut production to comply with quota agreements. Forward and swaps trading in Minas is also limited in scope.

The Heirs To Alaskan North Slope


Although Alaskan North Slope crude oil trading at the US Gulf Coast has now vanished, it was once an important benchmark and its departure has left a vacuum for sour crude oil pricing that has been only partially filled by West Texas Intermediate. Even before the lifting of the US export ban on Alaskan crude oil in 1996, ANS had lost its marker role due to declining production and a steep drop in volumes arriving at the Gulf Coast. ANS was dropped as a marker grade for term sales by Saudi Arabia and Kuwait in early 1994 and subsequently by Mexico and Ecuador in early 1996, and its spot price had been derived directly from WTI for years before that. With only a few spot trades a month at the US Gulf Coast, the volume of trading was no longer available to provide either an independent price signal or the basis for a forward market. Heavy spot trading and a forward market in ANS developed in the early- to mid-1980s, but by the end of

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the decade, forward trade was already drying up due to the dominant position of British Petroleum as a supplier and the rapid growth of WTI futures as a preferred alternative. Among alternative sour crude oil benchmarks in the Atlantic Basin the two most interesting prospects are the new Mars Blend grade from the deep-water US Gulf Coast and Russian Urals in Europe (see pH255,H221). Mars production started in mid-1996 and the crude oil is being positioned by the main producers, Shell and BP, as a possible spot benchmark grade. Potential volumes of up to 400,000 b/d or so could be available soon after 2000 and easy access to Gulf Coast pipelines promises an active spot trade. Furthermore, the main producers intend to sell a large proportion of the crude oil on a spot basis. Whether this active trade develops into a new Gulf Coast sour crude oil benchmark to fill the gap left by ANS depends on how the market and other producers react to the new grade, which is likely to trade initially at a differential to WTI. In Europe, Russian Urals has been touted from time to time as a potential sour marker, but its time has not yet come. It is still priced mainly at a differential to dated Brent, but some Russian exporters and European traders hope to see it grow into a high-sulfur sour crude oil benchmark in its own right with an active forward and futures market. Heavy spot trading has developed in recent years, especially in the pipeline system into Eastern Europe. This now involves both wet barrels and forward paper commitments a month or two in advance. A wide variety of players are involved, including Western firms producing oil in Russia or with access to exports, a host of Russian firms, Eastern European refiners, and other Western companies. The main problems lie in the uncertain quality of Urals, which could pose problems for trading. In addition, fears of Russian political instability and the potential for abrupt changes in government controls over exports have also dented enthusiasm for Urals as a marker.

The Dominance Of Spread Trading


While the benchmark crude oils play the key role in setting price levels for almost all other crude oil trade both spot and term-contract sales most of the trading in the marker grades is in some form of spread trading. The focus is on arbitrage or price relationships rather than on outright prices. A typical spread trade involves two parties taking opposite and partially offsetting positions that expose them to changes in relative prices rather than to changes in the absolute price levels. The preference for spread trading reflects a natural reaction to the volatility that is common in international oil markets. Spreads reduce the risk that is inherent in an outright position because the relationships between prices tend to be less volatile than absolute price levels. The heavy use of spreads also reflects the need of the markets to constantly adjust a complex set of intermarket relationships to large price swings. The reliance on price linkage to benchmark grades also tends to promote spread trading, as does the character of most market participants. Traders, oil refiners, and financial firms are often more concerned with relationships between markets than with the absolute price, which is the primary concern of producers. About 50%-65% of the trading in the 15-day Brent market and over 90% of the trading in Dubai is spread trading. Similar proportions of spread trade also seem likely to exist in WTI and Brent futures, although because of the way that these markets are structured, with a central clearinghouse handling all transactions, the volume of spreads activity is hard to measure. The New York Mercantile Exchange is particularly conducive to spread trading because it allows refiners and oth-

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ers to take offsetting positions in the crude oil and refined products markets, mimicking the economics of refining with a crack spread. According to an analysis of Petroleum Argus data on spot crude oil deals, the volume of spreads trading in the 15-day Brent market increased steadily in the late 1980s and early 1990s reaching as much as 80%, with an even-sharper rise in the Dubai market. However, in the case of Brent at least, the proportion of spread deals has declined since 1993, but this may also reflect a migration of this spread trading activity to the Brent futures market. There are two basic spreads that are widely traded in the international spot markets: Forward spreads and intercrude spreads. Forward spreads account for most of the activity and essentially involve trading the relationship between different delivery periods. Such deals are also known as straddles or intermonth spreads. They involve judgments about the premium (contango) or discount (backwardation) that is likely to exist in forward prices. A bull spread involves the purchase of a near month and the sale of a forward month to take advantage of an upward move in absolute prices, which tends to widen the backwardation in the forward market. A bear spread, the sale of a near month and the purchase of an outer month, is exactly the reverse. Several factors determine these forward price relationships in addition to the overall direction of absolute prices. Levels of inventories, storage costs, as well as future price expectations all play a role. Only a handful of intercrude spreads are heavily traded, although in theory they could be set up between just about any pair of crude oil grades in the world. Brent relationships to WTI and Dubai are the most actively traded intercrude spreads. The Brent-Dubai spread is commonly used to hedge or take positions on the relationship between sweet and sour crude oils, while the Brent-WTI spread reflects differences between the US and European markets. While spreads are usually viewed as less risky than outright positions, intercrude trades can be relatively more dynamic because of widely different market pressures. For example, the tendency of WTI to disconnect itself from international markets has, at times, produced wider swings in the Brent-WTI spread than in either price by itself. And in percentage terms, the swings can be much wider. In addition to these basic spreads, there are any number of more sophisticated variants. A box spread is a set of four deals that essentially is a spread on a spread, or the relationship between two different crude oil price relationships, e.g., Brent-WTI versus Brent-Dubai. Others include the crack spread mentioned above, reflecting a simplified refinery relationship between crude oil and products.

The Structure Of Spot Markets


The benchmark grades, the prevalence of spread trading, and the heavy reliance on pricing links to the marker grades together provide the basic structure of the worlds spot crude oil markets. The basic architecture is essentially one of relationships. Paper barrel trading in forward and futures markets now plays the central role in price formation and discovery, with a complex web of interlinkages connecting various submarkets for physical spot supplies with the more active and increasingly dominant paper barrel markets. Spot trading of wet barrels is largely in the shadow of forward and futures markets, with most of the focus on defining price relationships to marker grades. But ironically, the wet barrel markets for spot grades, such as dated Brent and Dubai, remain highly important because of the role that they play in setting term-contract price levels. Just as the wet barrel markets

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depend on paper barrel trade for a large element of price discovery, the forward and futures markets also depend on one another and interact constantly. No single trading center drives or dominates the international spot crude oil market, and no one market or price captures a complete picture of it. Rather, it is the interplay of all of the various elements that provides the overall result and direction.

THE MAIN CRUDE OIL MARKETS


WTI Sphere Brent Sphere Dubai Sphere Asia-Pacific Sphere

Swaps

Options

Swaps

Options

IPE Brent Futures Nymex Crude Futures (WTI)


Tapis Swaps

15-Day Brent
CFD

Forward Dubai

APPI Price Service

Cash WTI
Latin America

African Grades Other North Sea Grades

Dated Brent
Mediterranean Grades

Dubai

Govt-Set Monthly Contract Prices

Tapis
Austal -asia

Other US/Canada

Russian Oil

Oman Qatar UAE

Indonesia

Spot

Forward

Swaps & Derivatives Other

Relationships
Direct Indirect Or Partial

Futures

Spot Marker

Paper barrel purchases account for the vast majority of transactions, outnumbering physical crude oil deals by a ratio of more than 10-to-1 worldwide. However, a vast amount of this paper barrel trading is internal to these markets due to the heavy emphasis in both the Brent and WTI markets on forward spreads. This trading helps to make these markets highly liquid and enhances their ability to generate constant price signals. On the other hand, the physical markets, despite their smaller volumes, provide a discipline and, at times, a counterweight to the churning volume of trading in paper barrel markets that helps to keep them in touch with the genuine supply and demand fundamentals. Despite the importance of these linkages and the high degree of interdependence between markets, world spot crude oil trade divides quite naturally into four spheres WTI, Brent, Dubai, and Asia-Pacific. The two Atlantic Basin market areas, the WTI and Brent spheres, are by far the most active and also involve a much

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higher degree of integration between paper barrel trading and physical spot markets than the two spheres of trading East of Suez. In fact, the Dubai and Asia-Pacific spheres are, at times, heavily dependent on the price signals coming from the Atlantic Basin from the Brent market in particular. The diagram on pB26 provides a sense of the structure and relative mix in these markets between paper barrel and wet barrel activity. The lack of visible forward and futures markets to lean on for price signals and the inherent lack of liquidity East of Suez probably makes the Dubai and AsiaPacific spheres less efficient than the Atlantic Basin. The Asia-Pacific sphere is the most adrift and relies on a combination of alternative price signals from the Asian Petroleum Price Index and government-set monthly contract prices for basic indicators. In the Dubai sphere, the retroactive prices set monthly by state Adnoc for Abu Dhabi crude oils, by state Qatar General Petroleum Corp. for Qatar crude oils, and by Omans Ministry of Petroleum and Minerals (MPM) for its crude oil draw heavily on Dubai price quotes for the past month, but they do not come from a strict formula, except in the case of Qatar. It is in this indirect way that the spot prices for these Mideast crude oils are linked to Dubai. Despite their similarly high levels of activity, the WTI and Brent spheres have quite different personalities, too. The Brent sphere is more heavily oriented toward international physical trading, while the WTI sphere is the primary paper barrel market. Although the volume of transactions in the WTI sphere exceeds the trading in the Brent sphere by about 50%, it is almost entirely in the futures market. By contrast, the Brent sphere, which includes physical trading in all European, Mediterranean, and African crude oils, accounts for about 65% of physical spot market activity worldwide. Less than 10% of physical spot trading occurs in the WTI sphere, but over 65% of worldwide paper barrel trading occurs in the Nymex crude oil futures market. These different personalities tend to make the two regions complementary. Beyond the various benchmark grades that have been described above and account for most of the trading, there are some 50 crude oils that appear regularly in physical spot markets around the world. A profile of both the benchmark crude oils and these other regularly traded grades appears on pages B28-B29, with estimated volumes of reported transactions and the pricing basis for each one. In addition to these regularly traded crude oils, there are perhaps another 40 or so that come onto the spot market less frequently. The market activity listed in the tables adds up to a total volume of 4.2-million b/d in wet barrel spot trading. In addition, the volumes of trading for some of the crude oils probably exceed the amounts shown because the pricereporting services are unable to track all of the deals that are done. Thus, the 4.2-million b/d volume level in the table reflects only an estimated 50% or less of the total volume of spot trade. A similar understatement may exist for the Brent and Dubai forward markets. Despite these limitations, the figures below help to provide a clear idea of the market linkages and relative magnitudes of the markets in individual crude oil streams. Ultimately, the international spot crude oil market can only be understood as a broad set of relationships, with trading activity constantly seeking to define those relationships. But this reliance on market linkages also means that the physical spot crude trade that anchors most of the transactions represents a small fraction of the total volume of trade. As we have seen, this can pose problems for spot markets. A very similar system of linkages has emerged for most term-contract supplies, and as we will see in the following chapter, it has also brought significant risks and rewards along with it.

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SPOT, FORWARD, AND FUTURES MARKETS FOR KEY WORLD CRUDE OILS IN 1996
BRENT SPHERE Brent Complex Dated Brent 15-Day Brent IPE Brent Futures Europe/Mediterranean Forties Flotta Ekofisk Statfjord Oseberg Gullfaks (AB) Siberian Light Urals Es Sider Suez Blend Saharan Blend Syrian Light Iran Light Iran Heavy Africa Bonny Light Brass River Escravos Qua Iboe Forcados Bonny Medium Cabinda Rabi Total Brent Sphere Paper Wet Country UK UK UK UK UK Norway Norway Norway Norway Russia Russia Libya Egypt Algeria Syria Iran Iran Nigeria Nigeria Nigeria Nigeria Nigeria Nigeria Angola Gabon Market Type Spot Forward Futures Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Spot Reported Transactions 28/month 200/month 65,000/day* 20-25/month 2-3/month 10-15/month 5-15/month 20/month 3-5/month 1-2/month 20-25/month 0-1/month 0-1/month 0-1/month 1-2/month 1/month 2-5/month 2-5/month 5/month 3/month 5/month 5-7/month 1-2/month 5/month 1-2/month Estimated Vol. (b/d) 465,000 3,300,000 43,300,000 375,000 40,000 210,000 165,000 335,000 65,000 25,000 375,000 5,000 5,000 5,000 25,000 15,000 50,000 70,000 115,000 70,000 115,000 140,000 35,000 115,000 35,000 49,455,000 46,600,000 2,855,000 Pricing Basis 15-Day Brent/WTI Outright price Outright price Dated Brent Dated Brent Dated Brent Dated Brent Dated Brent/WTI Dated Brent Dated Brent Dated Brent/WTI Dated Brent Dated Brent Dated Brent Dated Brent Dated Brent Dated Brent Dated Brent/WTI Dated Brent/WTI Dated Brent/WTI Dated Brent/WTI Dated Brent/WTI Dated Brent/WTI Dated Brent/WTI Dated Brent/WTI

WEST TEXAS INTERMEDIATE SPHERE WTI Complex Country WTI Cash Market US Nymex Light, Sweet Crude Contract (WTI) US Americas Alaskan N. Slope (Calif.) WTS, LLS, And Others Cano Limon Cusiana Oriente Argentina Crudes Total WTI Sphere Paper Wet US US Colombia Colombia Ecuador Argentina Market Type Spot Futures Spot Spot Spot Spot Spot Spot Reported Transactions 12/day 150,000/day* 4-6/month 12/day 1/month 2/month 0-2/month 1/month Estimated Vol. (b/d) 30,000 100,000,000 65,000 30,000 20,000 40,000 20,000 20,000 100,225,000 100,000,000 225,000 Pricing Basis Outright price Outright price WTI WTI WTI WTI WTI WTI

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SPOT, FORWARD, AND FUTURES MARKETS FOR KEY WORLD CRUDE OILS IN 1996 (cont.)
DUBAI SPHERE Dubai Complex Dubai Forward Dubai Murban Lower Zakum Oman Qatar Grades Total Dubai Sphere Paper Wet ASIA-PACIFIC SPHERE Crude Oil Country Tapis Malaysia Tapis Swaps Malaysia Labuan Malaysia Minas Indonesia Widuri Indonesia Duri Indonesia Kutubu Papua NG Australian Grades Australia Total Asia-Pacific Sphere Paper Wet Worldwide Totals Total Volume Total Paper Total Wet Market Type Spot Swaps Spot Spot Spot Spot Spot Spot Reported Transactions 3-4/month 50/month 0-2/month 6-8/month 1-2/month 1-2/month 2-3/month 0-2/month Estimated Vol. (b/d) 60,000 400,000 15,000 115,000 25,000 25,000 40,000 20,000 700,000 400,000 300,000 Pricing Basis Outright/APPI Outright/APPI Outright/APPI ICP ICP ICP APPI/Tapis APPI/Tapis Country UAE UAE UAE UAE Oman Qatar Market Type Spot Forward Spot Spot Spot Spot Reported Transactions 12/month 60/month 5/month 5/month 15-20/month 3-4/month Estimated Vol. (b/d) 200,000 1,000,000 90,000 90,000 335,000 75,000 1,790,000 1,000,000 790,000 Pricing Basis Forward Dubai 15-Day Brent/Outright Adnoc Adnoc MPM QGPC

152,170,000 148,000,000 4,170,000

This list of crudes is not comprehensive, but it does cover all of the most actively traded grades. Reported transactions data are drawn from Petroleum Argus, other market-reporting services, futures exchanges volumes, other sources, and PIW estimates. Transactions outside of futures markets may understate the actual level of trading in some cases. *Per trading day.

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TERM SALES

Constant Evolution Transforms Term Contracts


Given the heavy reliance on spot-linked pricing for just about all crude oil supplies, the traditional distinction between single-cargo spot transactions and longer-term contract supply arrangements might understandably be viewed as largely theoretical. Indeed, almost all of the historical trappings of a term contract for crude oil have been progressively stripped away. The different values of term and spot deals can often be measured in pennies a barrel, and thus the differences in prices from the perspective of both buyer and seller are sometimes trivial. Todays term contract for crude oil is almost unrecognizable from its evolutionary ancestor in the late 1970s, which provided the buyer with fixed volumes for a fixed period at the same government-administered fixed price to all customers at the port of loading. If a buyer failed to lift crude oil as and when the contract indicated, it was subject to penalties. The buyer was willing to endure all of this for security of supply. Under the current system, both the duration of the contract and the volumes involved have become increasingly flexible and, in practice, can be adjusted almost at will, with buyers often allowed to take spot volumes over and above term supplies on a virtually indistinguishable basis. And with pricing linked to the spot market and at times customized for individual buyers, the term contract might be considered just a regularized or recurring set of spot deals structured to the needs of the individual buyers. Despite the growing similarities to spot deals, term contracts are still special and they fulfill important functions, which explains why they have accounted for a growing share of the international crude oil trade in recent years. The hallmark characteristic of term-contract supplies that distinguishes them from spot deals is the more lasting relationship they represent between buyer and seller and the operational predictability and simplicity that this provides to both. By definition, a term contract defines either complementary or mutually advantageous conditions for both buyer and seller, providing each with a degree of predictability. And, while the benefits may be skewed more in favor of one than the other party, in all cases term contracts provide sellers with relatively secure markets and buyers with relatively secure sources of supply. In either case, the buyer or seller sees a distinct benefit in having an enduring relationship rather than a series of flexible but unpredictable spot transactions. Contracts break down when conditions prevail in the marketplace that make the costs of maintaining the contract too dear for one party or the other. Thus, the term contracts of the late 1970s and early 1980s were based on fixed prices, administered by governments, and imposed on an f.o.b. basis at the ports of virtually all oil exporting countries. These contracts were regarded as tilted in favor of the exporter, which set the price at its export terminal. The risks of any price change between the time a cargo was lifted and then imported at the terminal of a refinery were borne by the buyer. However, after the Iranian revolution began to unfold in 1979 and 1980, oil prices started to escalate, and the risk borne by buyers turned into an advantage, since the price of a cargo could increase rapidly from the time a vessel left an export terminal until the time it reached an importers harbor. As a result, exporters

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began to break their contracts unilaterally and sell their cargoes on an auction basis because the terms of fixed price contracts became increasingly adverse to them. When the term-contract regime of the 1970s and early 1980s broke down and the spot market mushroomed, a period of uncertainty emerged in which buyers and sellers found it difficult to forge mutually beneficial ties and the ultimate underpinnings of trust between them were fractured. Beginning in 1981, after term-contract prices reached their peak, the sellers market of the 1970s quickly gave way to a buyers market. The oil exporters, which first broke contract sanctity in the late 1970s when oil prices were escalating, found themselves in great difficulty when they tried to insist that buyers adhere to fixed terms again. This time the buyers, facing the greater likelihood of falling than of rising prices, saw no reason to rush back to the sellers and their fixed terms. The buyers argued that these contracts had little value, predicting that the sellers would again break contracts anyway if oil prices resumed their earlier upward path.

Successful Term Contracts


Successful term crude oil supply contracts fulfill the purpose of defining risks, and there are three basic risks that any enduring contract needs to address satisfactorily for both the buyer and the seller. Two of these are market risks, and one pertains to prices. The market risks relate to security of sales, or markets, for sellers and security of delivery, or supply, for buyers. The contract provides a framework of understanding for buyer and seller, defining either narrow or broad limits of tolerance for each side as well as mechanisms for resolving disputes that may arise. In todays buyers market, the seller is forced to absorb many of the risks and uncertainties and give the buyer the virtual equivalent of a spot deal in order to retain some continuity of liftings. And the buyer also has definite advantages in the form of predictability and manageability that make attractively priced term deals more appealing than the spot market, where supplies of desired crude oils can be more erratic and a large trading operation is needed to constantly manage supplies. The third key element of contracts relates to the timing of when prices are triggered. To the degree that it takes time to deliver crude oil from an export terminal to the flange of the importing terminal, so price risk is borne by either the buyer or the seller. As we will see below, a critical issue thus becomes whether pricing takes place at or close to loading thus placing price risk on the shoulders of the buyer or whether it is triggered at or close to unloading thus placing price risk in the hands of the seller. The most important issue that the contract must deal with is that both parties have confidence that over time the price terms represent something close to the ultimate value of the particular stream of crude oil. And if that condition turns out not to be the case, the contract will not have much durability. Fair representation of the value of the crude oil in the marketplace provides the ultimate test for any crude oil contract. As a raw feedstock, crude oil commands no value per se. Its value is almost entirely a function of what becomes of it after it is processed into a slate of petroleum products (see Chapter E: Refining). Thus a crude oils quality is a key element of its value. To the degree that it can be processed more readily than other crude oils into higher value products such as gasoline, diesel fuel, and jet kerosine, it will command a higher value than other streams of crude oil that more readily yield lower-quality middle distillates or residual fuel oil. Beyond quality,

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the other key element in the value of a particular stream of crude oil is the distance between its source and the end-user market where it is refined. Since the value of crude oil is determined by local market conditions, transport costs to that market play a critical role in its price (see Chapter D: Logistics).

Growth In Term Contracts


Although comprehensive data are scarce, the available evidence suggests a clear expansion in term-contract sales during the 1990s even as spot activity has also grown with rising global oil trade. PIWs annual tallies of term contracts are the only global measure of these sales. They track all known term contracts for the leading international exporters and show them rising from 40% of the total production of these countries in 1989 to almost 55% in 1995. In volume terms, they have grown to about 15- to 16-million barrels a day in 1995, according to the PIW tallies (see Chapter G: Trade). Some of these term supplies are subsequently resold into spot markets, but this volume was initially sold under term contracts. The term contracts tracked by PIW also exclude smaller term sales by some international oil company equity producers. One of the difficulties that PIW has encountered in tracking term contracts is the large number of gray areas that lie between deals that are clearly either spot or term. These ambiguities make the classifications somewhat arbitrary at times and require that the crude oil sales of an exporter or the purchases of a company be viewed as a totality. These uncertainties are examined below, and the individual marketing strategies of key exporters, both spot and term, are described in detail in the reference section (see Chapter F: Country Profiles).

A Brief History Of Term Pricing


Although term-contract sales have staged a comeback, they are unlikely to regain the absolute dominance of international crude oil commerce that they enjoyed prior to 1979-80, when they accounted for 95% or more of all supplies. Spot transactions have become standard practice for most sales in the North Sea and for some other individual crude oils such as Dubai (see pH87), and because of the competitive pressures of these markets there seems little alternative to this type of marketing for these oils. By contrast, up until the Iranian revolution, term contracts and equity supplies accounted for almost all deals, despite the 1973 oil embargo and the nationalization of international oil company assets in many of the producing countries. Oil companies had little choice because of the scarcity of alternative supplies. The Opec producers simply adopted a slight variant of the posted pricing system of the major oil companies when they began to set rates unilaterally in 1973-74, and this system worked relatively smoothly until the second oil shock in 1979-80. At that point, as in 1973-74, spot prices were being pulled up by demand so rapidly that governments could not make adjustments in official prices quickly enough. Furthermore, government after government unilaterally broke contract arrangements in order to sell into the more profitable spot arena, undermining the supposed benefits of term supply arrangements. At one point, the former Aramco partners were nearly alone in lifting contracted crude oil at set prices, earning the so-called Aramco advantage. As is the case today, during the heyday of crude oil contracts, the prices of virtually all crude oils sold were based on a differential to a marker grade. In the 1970s, most crude oils were sold at official selling prices, sometimes also

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called government selling prices, which in turn were set according to differentials to a single crude oil namely, Saudi Arabian Light (see pH227). All other OSPs in Opec were set in reference to the marker, depending on differences in physical properties of the grades and distances to the markets. And, outside of Opec, the prices of virtually all other export crude oils were also based on administrative fiat in reference to the Saudi marker. By 1984-85, the official price system, which was the basis for most term contracts, was in a shambles. Buyers found that the strict terms resulted in unacceptable market risks and that security of supply, which was supposed to be the main benefit of the contracts, was unnecessary in the face of a global supply glut. They were also leery of the suppliers, whose reputations for reliability were tarnished severely when some unilaterally cut off their buyers during the earlier rising market. Many buyers opted for big increases in spot supplies and a host of other crude oil-purchasing arrangements offered by various countries in order to get around the objections of buyers to the rigidities and burdens of term supplies under the official price system. Many of these alternative marketing methods are still in use, and they serve as a source of the gray areas that now exist between pure term and pure spot arrangements. Saudi Arabia, which had remained the most committed to the official price system as it played the role of Opec swing producer, saw its output plummet by mid-1985 to unacceptably low levels of less than 2.5-million b/d. The response of Saudi Arabia to this untenable market predicament was to establish the netback pricing system in late 1985, which abandoned official prices completely and tied the value of crude oil directly to the spot market prices of the resulting products. Netback pricing, from a buyers perspective, is the most attractive mechanism that can be developed for two reasons: It prices a crude oil stream according to its real market value (see Chapter E: Refining); and it locks in a profit margin for refiner/buyers. Not surprisingly, this attractive market-linked pricing system was designed to rebuild Saudi market share, in which it succeeded splendidly but it also sparked a huge price decline in 1986. Netbacks quickly became the rage in Opec as producers competed for customers in the declining market and just as quickly fell from favor as Opec tried to restore some order to the market in late 1986. Rightly or wrongly, netbacks were blamed for the price crash and they still carry a stigma as a result of it. Despite their brief period of dominance of only about one year, netbacks represented a revolutionary shift to spot-market-linked pricing and the tacit admission by crude oil sellers that in order to remain competitive, term contracts needed to be taking their cue from spot markets. The netback pricing system was followed by a brief, unsuccessful return to fixed official prices and in late 1987 by the system of geographically-specific formula prices tied to spot crude oil price indicators or markers. This system of formula prices is still in place today. Unlike netback prices, which were based on spot product markets and assured refiners a guaranteed margin, the spot crude oil-linked system was a more direct reflection of the existing price situation in global spot crude oil markets, which made it safer and somewhat more conservative. It also permitted sellers to target specific areas and even specific customers by modifying formulas and other aspects of the contracts to meet customers individual needs. Ultimately, these adjustments have resulted in contracts that in many cases are tailored to individual companies. This furthers the goal of the producer, which is to lock in market outlets and achieve

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security of demand. However, the use of tailor-made formulas also reduces the transparency of pricing, making it harder to compare the relative cost of supplies. PIWs Price Scorecards have emerged as the only regular third-party assessment of the absolute level of term-contract prices implied by the formulas (see Chapter I: Prices). Formula pricing has proven to be effective as a tool for establishing and defending market share by producers in a period of surplus supplies and competition. It has also proved to be flexible and quite durable, but as will be seen below, it is not without its problems, particularly with regard to spot market benchmark reference crude oils. Just as pricing of term supplies became more attractive to buyers in the 1980s, volume and time commitments were also loosened. The old system of annual evergreen, or renewable, contracts for set volumes gave way first to releasing customers from underlifting penalties. Buyers were also given more latitude to cancel liftings, provided that they gave adequate notice, and to change volumes quarterly, or even monthly. At the extreme, countries such as Iran and Venezuela allow some customers to review price terms and volumes on a cargo-by-cargo basis, providing quasispot market flexibility.

Market-Related Formula Pricing


The market-related formula-pricing system is most prevalent in the Atlantic Basin, but it is also used by large Mideast producers such as Saudi Arabia, Iran, and Kuwait for crude oil sales to Asian customers. The key market link in all formulas is the benchmark spot crude oil grade that is used to drive or determine the final price. Simple crude oil linkages to a single benchmark grade are widely prevalent in markets where a benchmark crude oil predominates, such as the Brent marker in Europe and West Texas Intermediate in the United States (see pH241,H257). PIWs Crude Oil Price Scorecard regularly tracks these linkages and changes in the adjustment factors while also calculating the resulting prices for a particular crude oil, such as Saudi Arabia Light, which is based on Brent in sales to Europe or West Texas Intermediate in sales to the United States (see Chapter I: Prices). The quality of the marker need not be similar to the crude oil being sold. The key attribute of the marker grade is that it provide a clear price signal. It is for that reason that Mideast and Latin American producers tie their crude oil prices to WTI in the US, even though their sour crude oils are not directly competitive with the US sweet crude oil marker grade. WTI completely displaced Alaskan North Slope crude oil (see pH251) as the benchmark grade for sour crude oil sales in the US in the 1993-95 period as trading in Alaskan North Slope dried up on the Gulf Coast with declining production and the subsequent lifting of US export restrictions in 1996. Tying a countrys term-contract crude oil prices to a more widely traded and quoted crude oil stream is attractive in that it links a crude oil stream that may not be widely traded to one which is. This enhances price transparency. The system works best if the underlying qualities of the two crude oils are similar. If thats the case, the linkage provides a number of advantages. Primary among these is that a system of linkage is fairly easy to administer in a uniform and consistent manner. Another advantage is that crude oil linkages are highly responsive to changing market conditions, thus facilitating the development of long-term offtake arrangements with refiners. Ideally, the linkage should make the refiner indifferent to whether it is buying the more widely-traded benchmark grade or the linked grade, thereby facilitating its long-term commitment to purchase the exporters crude oil. Hedging of term-

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contract supply by the refiner is also facilitated because of the ready availability of forward or futures markets for the benchmark grade. The bottom line is that the risks to the refiner of term crude oil purchases are virtually eliminated. Even when the quality of the crude oil varies significantly from the benchmark, responsiveness in setting price differentials can help offset much of the potential risk, giving the buyer much the same kind of low-risk term-contract relationship. Whether a simple crude oil linkage to a benchmark grade ties together the prices of two similar or dissimilar grades of oil, this sort of tie can also carry a number of disadvantages, which make such linkages less than wholly satisfactory. Differences in quality can cause distortions in crude oil values that are not always fully addressed by changes in adjustment factors. Simple linkages may also facilitate retrading of a countrys crude oil stream, which implies that the exporter is not maximizing value for the crude oil in question. In the case of large Mideast producers such as Saudi Arabia, there is a trade-off between the advantages associated with simple linkages and the disadvantage of spot reselling. The big advantage is that this simplicity helps to move huge quantities of crude oil by creating a system that is easier to administer. Whats more, unlike some of its Mideast competitors, Saudi Arabia has largely prohibited spot resales of its crude oil by making such transactions contingent on its approval. But, because of its status as a preferred baseload supplier, Saudi Arabia has the necessary clout to enforce this. Another frequent disadvantage of simple crude oil linkages is that they tie the value of a crude oil to the peculiar characteristics and special market circumstances of a benchmark grade that may at times be out of line with overall market trends. In the case of Alaskan North Slope crude oil, which was used as a sourcrude oil benchmark on the US Gulf Coast until the mid-1990s, the lack of liquidity resulted not only in marked price volatility for the benchmark as well as the crude oils linked to it, but also market squeezes and other phenomena that can distort the price of the crude oil and cause buyers and sellers difficulties. The most popular benchmarks, UK Brent and West Texas Intermediate, also suffer from similar periods of stress when they are out of sync with overall market tendencies due to local circumstances (see pB9,B15). Use of crude oil baskets involving more than one benchmark grade is a frequently-used alternative to simple crude oil linkages with a single marker. Unlike the simple linkage, a crude oil basket can, at least in theory, reduce some of the disadvantages of reliance on a single marker that may be susceptible to peculiar market changes and localized circumstances. The most widely-used multiple linkage is found in Mideast crude oil exports to Asia-Pacific markets. The common formula for Mideast sales averages the spot prices of Oman and Dubai grades and adds an adjustment factor, which is positive for lighter grades, such as Saudi Light, and negative for heavier grades. The use of two markers in theory eliminates some of the volatility associated with use of a single marker link. In practice, however, the use of an average of Dubai and Oman grades stems from the lack of a more satisfactory marker for sales to the Far East. Unlike Europe and North America, the Asia-Pacific region lacks a widelytraded and locally-produced crude oil that can serve as an appropriate benchmark for sales from afar. The Dubai-Oman link also is not entirely satisfactory because spot trade in Dubai, and indirectly Oman, are influenced by Brent (see pB19). Complex market basket pricing, involving the average prices of three or more crude oils or of several crude oils modified by the averages of specific products

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come much closer than other simple formulas or crude oil baskets in representing the true value of a specific stream of crude oil to refiners. Thats because they come closer to replicating the netback, the value of the crude oil as processed into a spectrum of petroleum products. Mexico and Venezuela are preeminent in using these more complex market basket pricings as the basis of their sales formulas. The clear advantage of basket pricing is that it is specifically designed to reflect overall market conditions better than simple linkages, thus reducing price volatility and disparities. As a result, these formulas also capture more of the total rents of petroleum than less complex formulas, especially at times when the relative difference between crude oil and product prices diverge greatly. But they are not available to all exporters. Their construction and maintenance requires a fairly sophisticated crude oil marketing operation and close ties between seller and buyers to work properly.

Making Formula Prices Work


It takes more than a linkage, whether simple or complex, to one or more benchmarks to have a formula pricing system. While the adjustment factor is applied to account for quality and locational differences, other elements of the pricing mechanism take into account a variety of aspects of market risk. Thus, to avoid the risks of extreme volatility on a single day, an average of spot prices is normally embodied in the formula, usually over a five- to 10-day period in the market-responsive Atlantic Basin and a monthly average for Asian destinations. The adjustment factors, which are sometimes referred to as constants despite the fact that they usually change monthly, are usually set by the producing country. Changes reflect the market pressures on the crude oil, with tighter terms applied when markets are perceived to be strong, either in absolute terms or relative to the benchmark grade, and looser terms applied in a weakening market. The amount that term-contract customers are willing to lift in a given month often depends on whether the changes in the adjustment factors are viewed by buyers as fair. A country that is trying to expand its sales volume and markets tends to undercut others by offering more-attractive terms. However, tracking the relative competitiveness of crude oil grades to each other or the spot market is difficult because of the quality differences between grades and the complexity of the formulas themselves. While the formulas can be either for f.o.b. sales at the port of loading or for delivered sales to the refiners local market, a key element of most of them is to reduce the time risk to the buyer of price changes during the voyage to the refinery, which can take as much as a month and a half for shipments from the Mideast to the US Gulf Coast. The end result is that distant suppliers are able to compete for customers on an almost-equal footing with short-haul producers selling spot barrels. This innovation, which was originally part of netback pricing as well, allowed key Mideast producers to diversify their client bases and adjust sales terms geographically in various markets in order to optimize volumes in each area. This ability to discriminate between markets helped producers to compete with one another while also allowing them to maximize volumes and revenues in a chosen region. From a buyers perspective, formula pricing has been attractive because it presents them with a wider choice of feedstocks at prices that are guaranteed to be competitive. The price can, in theory, be triggered at any point between the wellhead, where crude oil is produced, and the refinery gate or rack, after a crude oil is

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An Example Of How A Formula Price Is Determined


An example of a typical formula price sale might involve a major oil company taking Arabian Light (see pH227) from Saudi Aramco under a term contract in May 1996 and bringing that crude to a refinery in Rotterdam. The entire price-determination process takes around two and a half months, which is about the longest of any term-contract formula. The process would have started at the beginning of April, with Saudi Arabia notifying its customers of the relevant adjustment factors versus the dated Brent benchmark that would apply for May liftings minus $1.30 a barrel in the case of Europeanbound Arabian Light. The major would then inform state Saudi Aramco of its lifting intentions, including the amount that it might want to take over or under its term-contract volume. Depending on availability, the quantities would be worked out with Saudi Aramco and the loading schedule for May would be set. If, for example, the Europeanbound cargo loaded on May 6, it would arrive in Rotterdam about 40 days later June 15 via the Cape of Good Hope route, at which time the pricing mechanism would be triggered. The formula calls for a 10-day average of dated Brent prices starting five days before the trigger date, implying a benchmark level of $18.64 a barrel at that time. The adjustment factor of $1.30 a barrel would be deducted from this market level, as would a small 24 a barrel downward adjustment for freight costs that are above the Worldscale 40 base rate, to arrive at the final price of $17.10 a barrel. It is important to note that the price terms for this cargo were established a month before lifting, but the final price was not apparent until 45 days after the cargo loaded.
SAMPLE TIME LINE OF SAUDI FORMULA PRICE CRUDE OIL SALE Saudi Aramco sets price differential for May May volume Cargo and loading loads in schedules Saudi Arabia set Voyage to Rotterdam Cargo arrives and price is triggered 40 days after loading

April

May

June

July

fully processed into a range of products and ready for sale to distributors and final consumers. For Mideast crude oil sales to the US Gulf Coast this time period amounts to some 75 days. Modern term contracts thus have a critical timing dimension, whereby the transfer of ownership of a crude oil cargo or even a partial cargo can differ significantly from the time when the cargo is priced. The locational differential of the value of crude oil relates to the costs of moving the crude oil from its export terminal to the refining center, including freight, insurance, shrinkage or loss, customs fees, port charges, and the time value of money. The valuation process of a cargo also needs to take into account the risk that the market value can rise or fall during the time period it takes to produce the crude oil, transport it and refine it into finished products. That risk is real and needs to be either absorbed entirely by the buyer or seller, shared by the two, or laid off on some intermediary (see chart above).

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A third critical timing element above and beyond the distinction between transfer of ownership of a cargo and triggering of its price is fixing the point in time at which payment will be effected. As in the case of triggering the price, this point can be at any point from the wellhead to the sale of retail products. None of these three points transfer of ownership, triggering of price, or timing of payment needs to occur at the same point in time as the others. Differences in their timing or occurrence in a transaction relate in part to the parcelTHE 90-DAY DIMENSION ing of market risk. But the differOF A MIDEAST CRUDE OIL SALE ential sequencing of these three points also gives rise to other risks, including market and credit risks, which also need to be shared by buyer and seller. Clearly, the closer the transfer of title and of risk of physical loss is to the point at which price is set, the less the amount of market risk that must be carried by the seller. Similarly, the closer both of these are in the sequences to the point at which the buyer resells the crude oil or resulting products, the less market exposure is faced by the buyer. As is explained below, there are ways for buyers and sellers to minimize these risks through the use of crude oil derivatives, which involve transferring the risks to others through futures markets, swaps, or options (see pC13). In addition to the basic mechanics of price timing, the benchmark grade, and the adjustment factors, there are sometimes other added elements in the formulas that seek to make them more attractive to buyers or to provide a closer reflection of the perceived market value for the crude oil. These include such things as freight adjustments, which guarantee buyers of long-haul grades for example, those from Saudi Arabia competitive prices for f.o.b. purchases regardless of possible tightness in the tanker market. These adjustments allow the producer to absorb potential extra freight costs, thereby keeping its crude oils on an even footing with short-haul supplies into the same market. Formula pricing has evolved in two seemingly contradictory directions since

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1987, becoming simpler in some respects but also more complex as sellers strive to meet closely the individual needs of specific buyers. The greater simplicity is reflected in the widespread use of just a few spot crude oil benchmarks and the nearly exclusive use of f.o.b. transactions, except for the delivered sales by Saudi Arabia and Kuwait to the US and by Saudi Arabia and Iran to Europe. Netback pricing, except for the vestigial use by a few producers, such as by Nigeria in the late 1980s, has also been almost completely abandoned. However, sellers continue to offer special inducements to buyers. These include extra barrels over and above contract volumes, which has at times become standard for some Saudi and Iranian customers.

Retrospective Pricing
The retrospective pricing mechanisms for term-contract sales, which are used by several countries in the Mideast Gulf and Southeast Asia to price their crude oils, are essentially a variant of formula prices. Instead of the more marketresponsive formulas, they rely on a monthly average of some explicit or implicit marker grade. The formula prices of the large Mideast producers to Asian markets are quite similar in that they also rely on monthly averages. There are a number of reasons for this price structure, which mainly reflects the buying habits of Japanese and South Korean customers. Especially important is the reluctance of these buyers to assume price risk on long-haul crude oils and their preference for long-term contracts, for which they are often willing to pay a premium. These arenas also have fairly thin spot markets, and the buyers in them have thus far shown a clear preference for uniformity: The Japanese and South Korean refiners, which are the regions largest crude oil buyers, tend to negotiate with producers as two large national groups, which results in the same prices for all buyers. In addition, the paucity of daily trading in a highly liquid spot market, especially in a clearly representative and dominant benchmark grade, prompts buyers and sellers to look to the longer monthly period for establishing a pricing basis for term contracts. This longer-term view is abetted by the special relationships that exist between some governments in these exporting countries and the Far East lifters of their crude oils. Pioneered by Oman, retrospective pricing has been widely used in Abu Dhabi, Dubai, Brunei, China, and Mexico (for sales to Japan). It involves a combination of a formula approach, based on indirect linkages to active spot markets, and a degree of subjectivity on the part of the producing country. The range of retrospective pricing arrangements is illustrated by the implicit but never stated linkage of Abu Dhabis term-contract pricing to the spot-market value of Dubai crude oil and by the complex, but clearly defined, formula mechanism used by Indonesia. Since Abu Dhabis crude oils are mostly lower in sulfur and lighter than most other Mideast Gulf grades, their prices tend to reflect their higher quality. But the monthly average of spot Dubai prices tracks closely with Upper Zakum, Abu Dhabis lower-quality crude oil (see pH23). Since all of state Adnocs sales are to Asian customers, the quality adjustments tend to reflect Asian refining values. At the other extreme, Indonesias pricing system is based on a basket of price quotes from the Asian Petroleum Price Index for a group of five Mideast and Asian crude oils. A rolling historical average of the differential between these five grades and the APPI spot price assessment for that particular Indonesian grade is then applied to come up with the final price. While this mechanistic approach is clear and consistent for all buyers, it lacks the kind of flexibility to adjust to seasonal shifts in crude oil quality as in Adnocs system

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or a monthly adjustment factor as used in a typical formula price. This rigidity has also forced Indonesia to sometimes make special adjustments in price terms for difficult-tomarket grades such as Duri and Widuri (see pH119,H127). Inevitably, a certain amount of subjectivity on the part of producers and trust between buyers and sellers enters into retrospective pricing. The subjective elements weighed by these countries include advice and information from local producers, buyers, outside consultants, surveys, and price reporting services. It takes fairly special circumstances for retrospective pricing to work, with a high degree of confidence on the part of buyers, such as those in Japan and South Korea, and responsiveness on the part of sellers to shifting market circumstances. While retrospective pricing is meant to simply track actual market values with a lag, in practice it lacks flexibility. Nevertheless, it has proven to be an important way for some term contracts to deal with changing market circumstances.

Benchmark Woes
With just about all term-contract prices formula or retrospective tied directly or indirectly to the same crude oil benchmarks that are used in the spot market, world oil trade resembles a grouping of three inverted pyramids with the basis for all price discovery found in these spot grades. As in the spot crude

DEPENDENCE OF TERM CONTRACTS ON SPOT BENCHMARKS

Saudi Arabia

Kuwait Mexico Venezuela Ecuador Colombia Argentina Canada Syria Libya Yemen Egypt Nigeria Iran Indonesia Qatar N. Zone

Abu Dhabi Oman

Americas 4.6-million b/d*

WTI

Europe 5.9-million b/d*

BRENT

Asia-Pacific 5.4-million b/d*

DUBAI

*1995 estimated volumes, based on listing of term contracts. Note: Areas indicate approximate sales volumes.

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oil market, the Brent pyramid is the biggest, but the large volume of crude oil moving into the US gives added international importance to domestically-based West Texas Intermediate grade. Dubai and Oman are the main markers for Asia-Pacific term contracts, but since monthly averages are used, their benchmark roles are somewhat more clear and direct than in spot crude oil trading. As shown in the detailed discussions of these benchmark grades in the preceding chapter, all of these markers have flaws that call into question their durability or reliability for the important roles that they play in price formation. The problem is that there are no viable alternatives at this point. As of 1996, Alaskan North Slope had completely disappeared as a marker grade and Dubai appeared to be the most vulnerable because of its declining production. But spot trading in Dubai has nevertheless flourished in the mid-1990s following earlier troubles. The well-established use of WTI is also far from perfect because of its tendency to disconnect itself from international arenas due to extreme internal domestic market pressures. The diagram on page C11 illustrates the heavy dependency of term-contract pricing on this handful of spot-market benchmark grades. Fully 5.9-million barrels a day of term-contract-priced crude oil, or about 37% of global volumes tracked by PIW, are directly dependent on Brent prices. And that doesnt even count about 3-million b/d of spot transactions that are also linked to Brent a crude oil stream of only about 500,000 b/d that has by far the biggest physical spot market of any of the global benchmarks. The combination of Oman and Dubai benchmarks for term-contract sales to the rapidly growing Asia-Pacific market provides the price signal for some 5.4-million b/d in term contracts, making them almost as important as Brent, which it is also dependent upon. WTI provides the benchmark for about 4.6-million b/d of term-contract sales, all in the Americas.

The Many Gray Areas


A whole range of alternative crude oil marketing methods have developed over the years. These variants all seek different ways to bridge the gap between term-contract sales and single cargo spot transactions. They come and go in popularity depending on the tastes of buyers and the objectives of sellers, and they also vary in complexity. The simplest and most straightforward are simply term contracts in which the price and volumes are negotiated on a cargo-by-cargo basis. Russia and Iran have traditionally been among the most regular users of this type of hybrid term/spot contract, together with other, smaller producers, mainly in Africa. This kind of pricing is also typical of test cargoes of new crude oils. Some producers such as Iran also offer spot volumes to customers over and above term-contract commitments. Saudi Arabia does this as well, but it usually limits these to existing term customers and insists on the prevailing delivered term-contract price rather than negotiating a special spot price. A variation on this is called a framework contract, which can vary almost infinitely. At their simplest, they may grant a particular buyer the right of first refusal on a particular volume. More elaborately, the contract may specify particular pricing mechanisms. Such contracts are particularly popular for Russian Urals crude oil (see pH221). The volume of crude oil sold under these quasi-spot contracts seems to have grown in the 1990s, and it could expand further with increased competition among producers as Iraq returns to the international market. Venezuela is also an active user of cargo-by-cargo sales, and the country has

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employed them quite effectively to expand its US market share since 1993, while abandoning its old, rigid system of posted prices. From 1992 to 1995, Venezuelas crude oil exports to the US jumped from 828,000 b/d to 1.26-million b/d, a jump of about 50%, which is due to its marketing flexibility and its US downstream investments. State PDV essentially allows buyers to use whatever type of pricing they prefer. Customers opt for a wide variety of pricing terms, which they can renegotiate with the Venezuelans pretty much at will. PDV usually builds in a time element that adjusts the price according to an agreed-upon linkage to the spot market so that the buyer is assured of an attractive price at the time of delivery. Prices can be based on spot crude oil or product benchmarks, or on a fixed price. This has made it hard to discern a typical or average price for Venezuelan crude oil.

Prefinancing And Barter


There are other alternative sales mechanisms that are designed primarily to lock in customers and maintain stable offtake by linking the contract volume to some other financial or commercial transaction. Known as either prefinancing deals or barter deals, they have become less popular than they were in the 1980s even though pricing is at times highly advantageous to buyers. While they are essentially term contracts, they are a special kind that binds the buyer and seller more closely together because there is always an incentive on both sides to keep the oil flowing in order to cover the cost of the loan or the barter arrangement. Barter deals became especially popular in the early 1980s, when the Opec official pricing system was breaking down. They typically involve the exchange of a fixed flow of oil over time for a certain agreed-upon set of goods and services. Under current deals, such as the well-known Saudi purchase of military jets and equipment from the UK, the oil is priced at standard term-contract levels and the cash is used to pay for the goods. The advantage of this to the purchaser over other contracts is that the producer dedicates a stream of sales to a deal and cannot cut back this volume without jeopardizing a separate commercial relationship that it values highly. Similarly, in prefinancing deals, the producer usually receives money in advance for a set value of crude oil over a period of time that is discounted in price to allow for interest payments. This gives the producer access to credit that it might otherwise have difficulty obtaining, and it provides the buyer with attractively priced supplies with no fear of being cut back due to Opec quota reductions or other circumstances. In the case of Iran, buyers were also given tremendous freedom about when they can opt to lift their crude oil entitlements. In 1996, prefinancing deals have enjoyed something of a renaissance among cash-strapped Russian exporters and with some Latin American countries such as Ecuador.

Processing And Product Swaps


Closely related to barter deals are crude-for-product swaps and processing arrangements, which, in some cases, can look a lot like netback sales. These deals can be used to move hard-to-sell crude oil or to disguise heavy price discounting, but they are also an attractive way for an oil exporter to meet domestic needs for refined products that it is unable to satisfy itself. Iran, Indonesia, Nigeria, Malaysia, China, Saudi Arabia, and Kuwait have all actively used these mechanisms at different times. Under a crude-for-product exchange, a certain agreed-upon volume of crude oil is swapped for a special slate of products that the producing country

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wants to import. A processing deal usually involves the refining of a given amount of crude oil at someone elses plant in return for an agreed-upon product yield, with some of the products taken back and the rest sold to the refiner or on the spot market. Some producing countries also utilize marketing agents to sell crude oil on their behalf, usually into the spot market on a cargo-by-cargo basis or to a specific set of buyers or a specific region. These sales usually involve some kind of fee or other profit opportunity for the intermediary, and they are a useful way for a producer to move a fixed volume of oil. Indonesian state Pertamina, for example, has joint-venture marketing firms with Japanese and South Korean companies that sell its crude oil to these countries. One problem with this approach is that aggressive sales by the agents can undermine other term-sales contracts from the same exporting country as Irans NIOC found in the early 1990s.

Triggers, Futures, Strips, And Swaps


Beyond the marketing methods of the producer countries themselves, there are also a number of derivatives market tools that are increasingly being used by crude oil buyers and sellers worldwide to provide the equivalent kinds of protection from market risks as available from term contracts. These techniques are especially popular in the North Sea and US markets, arenas that are heavily oriented toward spot deals. In addition to direct hedging through futures contracts for WTI and Brent, which is quite significant (see pB13), other common forms of such sales deals are trigger pricing and strips. Oil-price swaps and options can also provide similar benefits to buyers or sellers. In a trigger deal, the seller or market intermediary generally a Wall Street firm, trader, or major oil company with experience in the futures and derivatives markets usually agrees to sell a certain amount of oil at a price that is linked by a formula to a specific marker. The buyer then has the option to trigger the price at any point of its choosing during a set period before delivery. Sometimes the buyer is allowed to break up the pricing of the cargo in order to trigger the price of different parcels at different times. The seller covers the risk associated with this in the futures market or elsewhere, essentially allowing the buyer to pick the moment for the purchase when it feels that market conditions are most advantageous. A key advantage for the seller is that involvement in a number of trigger deals provides broader insight into market trends and a position to both hedge and trade against. In theory, the intermediary roles of setting up the trigger can be played by the buyer or seller, but in practice it is usually the seller that provides the trigger to the buyer. Strips are most common in the US domestic crude oil market. The seller agrees to provide a certain volume of oil to the buyer over a period of months with the price for each month tied to the New York Mercantile Exchange futures price. This allows both buyer and seller to manage their different price-risk exposures for the entire period as they see fit, while also providing the predictability of term supplies at a price that tracks market levels. Strips can extend from a period of a few months to over a year, but they are less popular for crude oils that do not track WTI with a fairly clear and predictable differential. On a broader scale, oil-price swaps and options provide many of the benefits of an old-fashioned fixed-price term contract, but since they dont involve physical deliveries of oil, they are simply a financial proxy. Unlike futures, they do allow the hedging vehicle to be tailored to the exact needs of the individual buyer

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or seller. The essence of an oil price swap is the parceling and transfer of risk from an oil buyer or seller to a financial intermediary. Although no physical oil changes hands, the user is assured a fixed price for a predetermined volume of oil by means of a set of purely paper transactions. In return for being assured of a fixed price, the buyer or seller agrees to give the swaps provider all or part of any further potential gain from a swing in the oil market in their favor during the period of the swap. Swaps are used in short-term applications such as contracts for differences or CFDs in the Brent and Dubai markets, as well as to lock in the value of a particular volume of crude oil for just about any period, ranging from a single loading to multiple years. An example of a typical swap for an oil buyer would work like this. An oil buyer seeking a fixed price of say, $18, would agree to pay the swaps provider the difference between that fixed price and any lower market price that may occur during the period of the swap in return for payments from the swaps provider of the difference between the fixed price and any higher market price. This effectively locks in the $18 price for the buyer, transferring all the risk of higher prices to the swaps provider. The oil buyer would buy physical supplies in the usual way, but if market prices exceeded the fixed price it would receive an offsetting payment from the swaps provider. In return, if physical prices were lower, the oil buyer would pay the swaps provider the difference between the market price and the fixed price.

The Hierarchy Of Term Sellers


One of the main reasons for the wide variety of alternative marketing methods described above is the constant competition among sellers to lock in sales volumes. Due to the past performance and perceived competitiveness and reliability of various producers, there is a hierarchy of sorts among them, with some being preferred over others as baseload suppliers in different regions. While preferences vary among regions and with the purchasing needs of companies, Saudi Arabia stands out as a core supplier to the widest group of refiners around the world. One clear indication of this is in the much larger average size of most Saudi sales contracts. While somewhat smaller than in the early 1990s, they still averaged over 110,000 b/d in 1995 and were more than twice the size of those of most other producers (see Chapter G: Trade). The extremely large contracts of the international majors with Riyadh are a further indication of its baseload supply role as well as an operational convenience for Saudi Aramco. Saudi Arabias attractiveness as a baseload supplier extends beyond the majors to most European and Japanese companies that rely on Mideast crude oils. The large volumes and range of grades, the past record of competitive and uniform pricing in each region, the flexibility of delivered sales in the US and Europe, and the willingness to allow over-lifting of contract volumes all combine to make Saudi Arabia a preferred supplier and a source of stable, predictable baseload feedstock supplies for more companies than any other producer. On almost the same level as Saudi Arabia as priority sources of baseload supply are Mexico, Venezuela, and Abu Dhabi. Their geographic focus, however, is not as broad. Mexico and Venezuela are viewed by most of their US customers as core suppliers, while Abu Dhabi has the same status among Japanese customers. But this status does not extend much further than those regions. As with the Saudis, the customer base for these countries in their core markets is extremely loyal, and neither of them needs to rely on traders or alternative marketing mechanisms in

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order to move crude oil regularly and reliably. For Japanese companies, several other countries, such as Indonesia, China, and Qatar, also play core supply roles, but this partly reflects a preference for predictable supplies and a diversity of sources. For some customers, Nigeria and Libya are clearly core suppliers, but this usually reflects some special circumstance relating to crude oil quality or financial interrelationships. As a result, they are regarded as baseload suppliers by a smaller group of companies. Libya is in a core supply position with its downstream affiliates in Europe and with key equity producers, such as Italian Agip and Austrian OMV. Nigeria can be viewed as a baseload supplier to a few sweet-crude-oriented refiners in the US, such as Sun, BP, and Hess, but the large number of traders among its term customers belies its status as a secondary supplier in most cases. Although Iran is the largest term-contract supplier after Saudi Arabia, it is generally not viewed as a baseload supplier by the vast majority of crude oil buyers. Even Japanese companies, which are well-represented on Irans customer list, regard these supplies as among the most expendable. This status seems to reflect both Irans past record of aggressive marketing as well as the political uncertainties that surround its oil exports, as was illustrated by the broadening of the US boycott on all purchases of Iranian crude oil in 1995. Although they limited the scope of Irans sales outlets, these political measures did not inhibit its oil exports or significantly undermine the prices it receives for its crude oils on the international market. Tehrans secondary status is also partly the result of its own marketing methods, which included a heavy reliance on spot sales and other alternative methods in the early 1990s. But since 1994, Iran has not been under pressure to boost sales volumes, and its termcontract-sales policies have become steadier and more stable, which has helped it both to survive intense market competition in Southern Europe from Russian exports as well as to cope with the loss of its US customers in 1995 due to sanctions. Among other major exporters, Norway has started to emerge as a baseload supplier in the US and Europe through Statoil. Although large volumes of Norwegian crude oils are handled by equity producers, as in the UK, Statoil has by far the largest share because it markets crude oil on behalf of the government. To cope with these large volumes from the worlds second-largest oil exporter, it has established a growing number of term deals. It is regarded as such a reliable supplier that refiners such as Ultramar have gone so far as to modify their refineries to handle new supplies of Statoils Heidrun grade. Most other term-contract suppliers are viewed as second-tier, or non-baseload, sources of supply. This is reflected in the diversity and variability of their customer lists and the relatively small average contract volumes that they market. Countries falling into this category include Syria, Egypt, Angola, Ecuador, and Oman. However, producers serving the Asia-Pacific region such as Malaysia, Indonesia, Yemen, and Qatar have generally benefited from the preference of Japanese crude oil buyers for stable term-contract relationships. In these second-tier countries, equity producers also play a core role in absorbing their own output and also other production from the government.

The Varying Strategies Of Buyers


While the concept of baseload supply is central to the purchasing patterns of most oil companies and is at the heart of successful term-supply relationships, few firms other than some high-risk traders are willing to put all of their eggs in one basket. Even the overseas downstream affiliates of Saudi Aramco,

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Venezuelas PDV, and Kuwait Petroleum Corp. seek out other term crude oil supplies, if only for quality and operational reasons. In this sense, a companys approach to term crude oil purchasing can be viewed as a portfolio, with different contracts having a mix of different attributes. The grouping of crude oils varies depending on the position, needs, and objectives of the company. Some firms have access to more equity supply or have locational or quality preferences that outweigh other concerns. Term-contract supply strategies can range from heavy reliance on a small number of suppliers to several smaller contracts with a range of suppliers. Politics and particularly the use of embargoes and economic sanctions by the US government have become some of the more important considerations for crude oil buyers. With the US imposing unilateral restrictions on crude oil purchases from both Libya and Iran in addition to the UN restrictions on Iraq, a large range of commercial relationships has been affected and these kinds of measures may be expanded. US companies in particular must consider the risks of termcontract supply arrangements with countries that may later be singled out for sanctions. While lost investments represent a much more serious problem, the shifting in supply deals for large US buyers of Iranian crude oil, such as Exxon in 1995, was not easy and made them vulnerable to demands for stiff terms from other suppliers. In the case of Exxon, significant increases in Saudi supplies and forays into the Russian Urals spot market helped ease the strain. The supply strategies of major oil companies, such as Exxon and Royal Dutch/Shell typify the approaches of large international oil companies, albeit with some variation. While both depend on Saudi Arabia for more than half of their term-contract crude oil needs, Exxon turns to a smaller range of producers for its other supplies, while Shell seems to put more emphasis on diversity (see Chapter G: Trade). European majors such as Elf, Agip, and Total dont seem to lean as heavily on Saudi Arabia and often prefer to turn for term crude oil supplies to countries where they already have strong equity crude oil supply relationships. Libya, Nigeria, and Iran tend to loom larger in their supply arrangements than they do for the international majors. Japanese and South Korean firms have a unique pattern of term crude oil purchasing that reflects their highly risk-averse approach. Due to relatively low volumes of equity crude oil production and an abiding concern for supply security, they dont rely on any one source too heavily, but they also seem to view a wider group of producers as baseload suppliers. Each company has many sources of supply, but contracts of more than 25,000 b/d are unusual and those over 50,000 b/d are extremely rare, except for the biggest buyers. Saudi supply contracts are usually about the same size as those with other producers, such as Abu Dhabi, Qatar, Kuwait, or Iran. Japanese buyers also buy jointly from Indonesia, China, and Mexico, reducing the volumes and risks for individual refiners. Other large Asian crude oil buyers such as Indian Oil Corp. or Pakistan tend to have more dominant relationships with a smaller group of suppliers. As one might expect, the crude oil-supply patterns of oil traders show the least concern for reliable baseload volumes and are mostly oriented toward riskier non-core suppliers. They also lean heavily on just a few sources. Traders with refineries, such as Phibro, and some refiners, such as Coastal and Petrofina, also follow the same pattern. Iran, Nigeria, and Ecuador stand out as primary suppliers to these trad-

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ing firms. Some highly spot-oriented sellers, such as the Russians, are also an important source of supplies to trading companies. A greater willingness to switch between supply sources also characterizes the approach of traders and other similar firms.

Whos Who Of Term Contracts


A greater level of detail on the crude oil marketing techniques of some 35 key exporters can be found in the reference section of this report (see Chapter F: Country Profiles). It expands on many of the points made in this chapter on term contracts and in the preceding one on spot crude oil markets. The tables on crude oil sales volumes in the reference section of this book (see Chapter G: Trade) present a wide range of useful but hard-to-find data on term contracts. The first set covers PIWs annual surveys of term crude oil contracts for 1995, 1993, 1992, and 1989, broken down by both country and company. Next is a profile of US crude oil imports by company for the last five years. The PIW surveys give the best available overview of the structure of term crude oil supplies and their evolution from both the perspective of supply sources and company purchases. The US imports data display comprehensive details for individual countries and companies, but they lack a complete breakdown between spot sales, term contracts, and equity supplies or other arrangements. The next chapter takes a closer look at the particular difficulties of of transporting and storing crude oil, which have a critical impact on oil markets. Not only are transportation and storage costs an important variable in the total cost of crude oil, the smooth operation of transport systems and pipelines is critical to the effective functioning of oil markets.

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LOGISTICS

Tankers, Pipelines, And Stocks


The physical process that ties markets, refiners, traders, and producers together is the sometimes-complex and difficult business of transporting and storing crude oil. While its easy to view these operational activities as secondary and take them for granted during periods of smooth market operations, logistics have a tremendous impact, and they are of critical importance in periods of crisis or dislocation. These basic transport and storage functions also have their own internal economics and dynamics that can impinge on oil markets in major ways. Oil has been described by some economists as a flow commodity, in contrast to metals or agricultural commodities, which traditionally involve much higher inventories. Most of the worlds oil inventories are used for operating the huge global supply system and can be thought of as an enormous pipeline stretching from the wellhead to the retail pump. Only the equivalent of a small 10-15 days of forward demand cover is discretionary, or freely usable by oil companies. And the trend of the mid-1990s has been toward tighter management of these operational stocks, bringing them down to minimum operating levels at times. Thus, the smoothness of transport and storage systems is increasingly critical to ensure that supplies are adequate. This chapter outlines the basic elements of tanker and pipeline transportation of crude oil and the global inventory system.

The Tanker Dilemma


World oil markets are enjoying a surplus of tankers that has lasted for over 20 years and has kept the cost of moving crude oil relatively low, especially on the largest crude oil carriers, which are the backbone of global oil trade. The basic dilemma that has been confronting the tanker industry for years is the Crude Oil Tanker Fleet need to replace an aging fleet, couCrude oil alone makes up about one-third of pled with the inability to achieve total worldwide seaborne trade. There was a high enough returns to justify the big fleet of some 3,100 tankers above 1,000 deadcapital investments that would be weight tons, with combined capacity of 275million deadweight tons at the end of 1995. Of required to do so. Another obstacle these, 220-million dwt were for crude oil. has been added by growing public Deadweight tons are approximately equal to concern over and legal liabilities for carrying capacity. Standard size classifications oil spills. These difficulties have created of crude carriers follow: a harsh business environment for tanker Fleet Class Size (dwt) (million dwt) owners, and they have also prompted Aframax 60,000-100,000 48.8 major international oil companies to Suezmax 100,000-200,000 46.8 reduce their own fleets over the years. VLCC* 200,000 and over 124.5 Some oil-producing countries, such as Total 220.1 Saudi Arabia and Iran, have increased *Very and ultra large crude carriers. their fleets with the growth of delivered crude oil sales and formula pricing. Saudi Aramcos Vela oil tanker unit now has 23 very large crude carrier (VLCC) sized ships, and is scheduled to receive five new 300,000

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deadweight ton ships in 1996-97. Iran is also taking delivery of five big ships in 1996, and Kuwait is expected to place new orders. Nevertheless, independent owners still account for about 60% of the total tanker fleet, with the rest owned by international oil companies and producing countries. The average age of the biggest ships the very large crude carriers (VLCCs) and ultra large crude carriers (ULCCs), with capacities of over 200,000 deadweight tons is about 15 years, but many of them were built before 1978 and are due to soon reach the end of their assumed operating lives of 20 to 25 years. The VLCCs and ULCCs make up about 45% of total tanker tonnage. They transport 90% of Mideast Gulf crude oil exports and sail to all of the main world markets, making them critical to global crude oil commerce. Oslo-based Intertanko, the international association of independent tanker owners, estimated that in 1995 there were 33 surplus VLCCs, or about 7% of the fleet of 449 vessels. The origins of this longrunning surplus lie in the period of extremely high freight rates and rapidly rising oil demand in the late 1960s and early 1970s, which triggered massive overbuilding of the first generation of VLCC- and ULCC-sized vessels. The total tonnage of ships over 200,000 tons has declined from more than 140-million tons in the early 1980s to about 125-million in the mid-1990s. And with rising international oil trade, the surplus has diminished from as much as 20% of the fleet in the early 1990s. The movement toward a more even balance has resulted in a slight firming in freight rates in 1995 and early 1996, but rates are still not high enough to justify construction of new tankers, especially the higher-cost double-hull vessels that are expected to become the norm. In anticipation of the retiring of old surplus tankers, and in response to the higher freight rates that prevailed during the Gulf war period, many new ships of over 200,000 tons were ordered in the early 1990s. But the flurry of new orders was a bit premature, and these new ships are now extremely unprofitable, providing little incentive for further new orders except from the bravest of owners. According to Intertanko, average spot freight rates in 1995 covered only about one-half of the $40,000 per day operating and capital costs of a new tanker. Meanwhile, older, pre-1975, second-hand VLCCs almost broke even. Given increasing concerns about the safety of tankers and requirements by both the US and international organizations for double-hull tankers, a two-tiered market has begun to develop, with better ships getting higher rates. This premium, which is taken into account by Intertanko, is not yet large enough to make the new ships remotely profitable. Only during the Gulf war period, when the world VLCC fleet was almost fully utilized with large Saudi and Iranian floating stocks, did freight rates reach the kind of returns that could encourage significant building of new vessels. Double-hull tankers currently account for about 14% of the entire fleet, and only about 7% of VLCC and larger tankers, while over 22% of the smaller Aframax class are double-hulled. This larger share reflects the more recent timing of new orders in response to new regulations such as the US Oil Pollution Act of 1990 (OPA 90). The relatively low percentage of double-hull tankers in the VLCC fleet means that a significant tightening of that market would likely to lead to a much more pronounced two-tier market. However, as of now there are plenty of single-hull VLCCs that still qualify to call at US ports under OPA 90. Reliance on more modern ships could get a significant push in the future from stricter regulations on the part of both importers and oil producing countries.

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No obvious solution exists yet to the dilemma facing the tanker industry: namely, the need to rebuild, but the weak incentives to do so. The risk of a serious crunch that would drive freight rates up sharply is genuine and could be confronted by world oil markets as soon as the late 1990s. As in other areas of the oil industry, the long lead times needed for building new capacity tend to encourage boom-and-bust cycles, which are likely to be exacerbated in the case of VLCCs by the age of the fleet and the heavy reliance on spot chartering. The exact circumstances of such a squeeze on shipping capacity are hard to predict, but the financial rewards are not yet in place for the smooth replacement of the large number of old tankers in the fleet. While the Suez Canal and expanded pipelines across Egypt and Israel from the Red Sea to the Mediterranean could help to ease some of the potential pressures, the risk is that there could be a period of months or years of extremely high freight rates that would add significantly to the delivered cost of crude oil. Such high returns would encourage aggressive shipbuilding that would eventually bring on another bust, but not until after the freight component of delivered crude oil costs had been driven to an extremely high level perhaps two or three times current levels. Adding to uncertainty about when a squeeze might occur is the capability of older VLCCs to extend their operational lives to up to 30 years by installing segregated balast tanks.

The Tanker Market


Like the crude oil market itself, the tanker market operates on both a spot and a term basis, with the latter referred to as the time-charter or period market. Spot charters account for a great deal of tanker usage as much as 50% especially for the long-haul VLCC trade. But dependence on spot chartering has declined somewhat from peak levels of over 80%. The drop in spot movements reflects the growth of producer country fleets as well as the preference of Japanese and other buyers for period chartering of safe, modern vessels. The still heavy spot chartering reflects the continuing surplus in the market and also increases its vulnerability to squeezes in the future. Many oil companies also have their own ships, but unless the company has dedicated them to serving a particular route for operational reasons, these vessels are usually released into the spot market. Because it is hard to make sure that an individual ship is in the right place at the right time to load a cargo, oil companies tend to opt for the flexibility of the spot market, which, aside from low cost, is its main attraction. Time chartering may continue to increase as buyers become more selective about the safety of their ships, but this is still likely to leave the spot market dominated by older, lower-cost single-hulled ships, which will act as a depressant on overall freight rates. In a typical spot charter, the cost is determined by a number of variables, including the particular voyage, the availability of appropriate ships in relation to demand, the condition of the vessel being chartered, and other factors. The cost is usually assessed as a percentage of the Worldscale system of base or flat rates, which are updated annually by an international panel. A lump sum is sometimes charged, but this is more typical of short voyages or the shipping of refined products. Illustrating a standard spot charter, an oil company wanting to load a cargo of crude oil from a particular port on a particular day in the near future contacts a tanker broker to line up a vessel. The broker negotiates rates with the owners of the available vessels. These are calculated as a percentage of the Worldscale flat rate, which is based on a stan-

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dardized assessment of the costs of sailing a certain type of ship on that particular voyage. A rate of Worldscale 40 simply means 40% of the established flat rate for the specific voyage in question. A host of operational considerations in addition to the price play a part in a companys final decision on which ship to charter. Other factors that loom large in determining freight costs are insurance, demurrage, and environmental issues. With greater public concern about oil spills and stiffer legal liabilities, the costs of operating tankers are rising. Oil companies in particular face difficult choices because of the potential public relations damage from a spill, even if they own only the cargo, not the vessel, and therefore are not directly responsible. Under the US Oil Pollution Act of 1990, both the vessel and cargo owner are potentially exposed to unlimited liabilities for a spill, depending on the requirements of state law. As a result of these kinds of laws and new international rules that stipulate the construction of double-hulled or equivalent vessels from 1996 onward, costlier double-hulled ships are the norm for new construction. The added environmental burdens for tanker owners and their clients have mainly appeared so far in insurance costs, but as charterers become more selective, freight rates for double-hulled ships are also starting to feel added pressure too. Insurance rates can soar due to war risks, as they did during the attacks on shipping during the Iraq-Iran war. There are two basic types of tanker insurance: cargo insurance, which covers the value of the oil being transported and is usually the responsibility of the owner of the oil; and hull insurance, which covers the ship and is usually paid for by the shipowner or time-charterer. Demurrage is unpredictable and potentially costly. It refers to the extra costs of keeping a tanker waiting in port, which can be quite significant if the ship faces unexpected delays that last for a period of several days. This might occur if an exporter is unable to follow the planned loading schedule or if a cargo is unable to be unloaded promptly due to a storm or other disruption. Usually, the party deemed responsible for the delay must pay the shipowner or time-charterer for the demurrage at a set rate, depending on the size of the vessel.

Choosing A Ship
The crude oil tanker-chartering business is divided into three broad markets, depending on ship size. The reason for this is that efficiencies of scale, logistical constraints on vessel size, and customer needs usually mean that tankers of a certain type are best suited to and tend to dominate specific trade routes. Crude oil buyers generally cannot easily substitute one class of ship for another. While economies of scale usually make larger tankers more cost-effective, there are any number of reasons that VLCC-class vessels cannot be used for all voyages. A crude oil buyers term contract is likely to be based on a certain volume that can be best handled by a monthly or quarterly loading of a single cargo of a certain size. Some discharge ports for example, all of those in the US except the deep-water Louisiana Offshore Oil Port, or Loop require the use of smaller, shallower draft ships. Similarly, the limitations of loading ports can also constrain the type of vessel that is used. Specific size restrictions for individual loading ports are provided for all of the crude oils that are covered in the second section of this handbook. The largest market in terms of tonnage, distances, and ships is the VLCC trade, which has been covered in part above and which dominates shipments both east

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and west from the Mideast. The economies of scale in using these big vessels of 200,000 dwt or more for the large volumes produced from the Mideast and the longer distances that the crude oil must travel are obvious. The difficulties for both buyer and seller come mainly in the oil-market risks during the long time period of the voyages, but these risks have been largely overcome through geographically specific formula pricing. For US customers, the extra cost of lightering these vessels, or transshipping the crude oil to get the oil into shallow-draft US ports, must also be taken into account as part of the total shipping cost, but even so, it is still cheaper to ship crude oil from the Mideast to the US in VLCCs. A separate complication for oil shipments on sized tankers between US ports are special cabotage restrictions that require the use of US flagged ships, which are significantly more expensive to operate than those on the international market. There are also some other secondary uses for VLCCs outside of the Mideast trade. They are sometimes utilized for voyages from West Africa to Europe and the US or trips from Europe to the US. VLCCs in westbound trade from the Mideast can at times benefit from a partial backhaul when they take crude oil from West Africa to East Asia covering part of the voyage that they would normally have to make anyway in ballast on their return from the US or Europe to the Mideast. In addition, VLCC-class tankers are preferred for usage in floating storage. This involves both temporary storage and dedicated vessels that are in permanent use at loading terminals, particularly those for offshore production. The Aframax class of tankers those from 60,000-100,000 dwt represents the smallest of the regular oceangoing crude oil carriers. They are used primarily for short-haul trades in the Caribbean, Mediterranean, North Sea, and Far East. Some work the shorter voyages from the Mideast as well. These ships are also the class used in most spot crude oil market transactions. The smaller size of the cargo, 450,000750,000 barrels, provides flexibility and allows the ships to easily load and unload at almost any terminal. Many ships in this class also meet the Panamax size restriction of 106 feet beam, which in practice means an upper limit of 60,000-70,000 dwt and is the maximum size that can pass through the Panama Canal. Some vessels of this size have been specially configured to serve offshore loading platforms in the North Sea or elsewhere, while others have been fitted for the lightering of larger vessels. Tankers of this size are also regularly used for carrying dirty refined products such as residual fuel oil. Unlike the larger tankers, the Aframax fleet is not heavily dominated by older ships, and thus it is less vulnerable to the kind of squeeze that could occur if an adequate incentive to replace those aging fleets does not emerge. Suezmax vessels of 100,000-200,000 dwt are the intermediate class of crude oil tankers. They also dominate particular trade routes, but they generally have more overlap with the other two categories, and they sometimes trade along their main routes. Suezmax tankers trade primarily from the Eastern Mediterranean, Red Sea, and West Africa to the US and Europe. They are also used for some longer shipments in Asian markets, and they sometimes take crude oil from the North Sea to the US or the Mediterranean. The embargo on Iraqi exports and the earlier restrictions on Libyan crude oil sales to the US have been especially hard blows for Suezmax ships, which played an important role in those trades. While all of these vessels can use the Suez Canal, only those that are 180,000 dwt or less can pass through fully laden. This restriction is due to rise to 200,000 dwt by the late 1990s. Suezmax ships must often be lightered in order to use shallow draft ports such as those in the US. The

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age profile of the Suezmax fleet is similar to that of VLCCs, with most of the ships growing old and in need of replacement by the end of the 1990s.

A Profile Of Key Shipping Routes


To provide a comparative picture of the most common voyages in the international crude oil trade, the table on page D7 gives basic data on distances and average voyage time. Use of the Suez Canal is a key consideration in voyages from the Mideast to the Atlantic Basin. Fully laden VLCCs are too big for the canal and often take the longer route around the Cape of Good Hope. The distances shown in the table are nautical miles, and the times are based on an average speed of 12.5 knots, typical of the slow speed often used to conserve fuel on older, less fuel-efficient tankers. VLCCs are capable of speeds in excess of 16 knots, and newer vessels usually operate at this speed. In addition to the travel times, it takes at least one to two days at each end to load and discharge the vessel.

Pipelines: Long Hauls And Shortcuts


Pipelines are secondary to tankers in terms of the volume of crude oil that they transport for international trade, but they are no less crucial. They provide vital outlets for many landlocked crude oils and critical links within large continental markets. They also complement tanker transport at key geographical points, such as Suez and Panama. The main economic justification for pipelines is their sheer efficiency. In addition to extremely low-cost, efficient transportation, they provide shortcuts at key points on the earth and provide vital links to key inland markets. Alternatives to pipelines for overland transport, such as railroads and tank trucks, lack the scale to meet the needs of large refining centers or oil-producing regions, and, in any case, would normally be far more expensive. The big drawback to pipelines is their lack of flexibility. They can only move oil along their designated route and major new construction is required if markets shift or trade dries up. The clear efficiencies of pipelines stand in sharp contrast to their vulnerabilities, particularly in international trade when they must cross borders. In addition, basic operational difficulties can also cause huge problems, with a stoppage at one point holding back large supplies from further up the line. One important example of this was the problems with the UK Brent system in 1989-90, when the shutdown of some main platforms choked off supplies from satellite fields. Examples of the political vulnerabilities range from the persistent guerrilla attacks on Colombias Cano Limon line to the many idle pipes that stretch across the Mideast. For oil-producing countries with limited or no access to the sea such as Iraq, Azerbaijan, and Kazakstan pipelines are always a key strategic asset. Over the years, Iraq has built four different pipeline export routes, of which only one, the Turkish line, seems to have much chance of being used when the United Nations embargo against Iraqi exports is lifted. Even producers with adequate ports have built major pipelines in order to provide alternative outlets. An obvious example of this is Saudi Arabias Petroline outlet at the Red Sea port of Yanbu, which provides an alternative to the politically troubled Mideast Gulf and Strait of Hormuz. The construction of export pipelines from Central Asia has become a key bottleneck in the development of the Kazak and Azeri oil industries that finally started to (Please turn to pD8)

CRUDE OIL HANDBOOK

SHIPPING DISTANCES AND TIMES FOR KEY TANKER ROUTES (Nautical Miles / Days)
From: To: Americas Curacao, Netherlands Antilles Curacao, Netherlands Antilles Corpus Christi, Texas, USA Corpus Christi, Texas, USA Philadelphia, Pennsylvania, USA Rio de Janeiro, Brazil Los Angeles, California, USA New York, New York, USA St. Croix, Virgin Islands, USA Europe Fos/Lavera, France Fos/Lavera, France Rotterdam, Netherlands Rotterdam, Netherlands Le Havre, France Trieste, Italy Africa Durban, South Africa Asia/Pacific Singapore Yokohama, Japan Yokohama, Japan Ulsan, South Korea Singapore Route via Cape via Suez via Cape via Suez ... ... ... ... ... via Cape via Suez via Cape via Suez ... ... ... Ras Tanura, Saudi Arabia 10,729 / 35.8 8,700 / 30 12,546 / 41.8 9,816 / 33.7 ... ... ... ... ... 10,783 / 35.9 4,684 / 16.6 11,169 / 37.2 6,350 / 22.2 ... ... 4,280 / 14.3 Bonny, Nigeria 4,560 / 15.2 ... 6,220 / 20.7 ... 5,182 / 17.3 3,392 / 11.3 ... ... ... 3,994 / 13.3 ... 4,386 / 14.6 ... 4,181 / 13.9 4,957 / 16.5 ... ... ... 10,740 / 35.8 ... 8,000 / 26.6 Ardjuna, Indonesia ... ... ... ... ... ... 7,899 / 26.3 ... ... ... ... 8,525 / 29.4 11,390 / 38 ... ... ... ... 3,209 / 10.7 ... ... 513 / 1.7 Sullom Voe, UK ... ... 4,875 / 16.2 ... ... ... ... 3,174 / 10.6 3,727 / 12.4 2,649 / 8.8 ... 600 / 2 ... ... ... ... ... ... ... ... ... Sidi Kerir, Egypt 5,502 / 18.3 ... 6,618 / 22 ... ... ... ... ... ... 1,400 / 4.7 ... 3,152 / 10.5 ... ... ... ... ... ... ... ... ... Amuay Bay, Venezuela ... ... 1,802 / 6 ... ... ... ... 1,802 / 6 ... ... ... 4,318 / 14.4 ... ... ... ... ... ... ... ... 11,423 / 38

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... 3,701 / 12.3 via Malacca 6,593 / 22 via Sunda, Indonesia ... ... 6,253 / 20.8 ... ...

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make some steps toward resolution in 1996. But the future of these lines remains in doubt, illustrating the intense political struggles that pipelines can generate as well as their vulnerability to such pressures. While it was clear from the start that the most viable route in the short term for both Kazak and Azeri crude oil exports to the West was through Russia, the powerful northern neighbor has been able to extract some benefits from its favored position. Following much hard bargaining, partners in the $2-billion Caspian Pipeline Consortium are Kazakstan, Russia, Oman, Chevron, Mobil, Agip, British Gas, Lukoil, Rosneft, and Kazak state Munaigas. This 1,500-kilometer line is to be built in two phases and will run from the Tengiz field in western Kazakstan to the Black Sea, with capacity rising from about 300,000 barrels a day to over 1-million b/d. The Azeri export line calls for two routes to the Black Sea, one via Russia, which would tie into the CPC system, and one via Georgia, which is also likely to involve the Russians. A line through Turkey, or at least to bypass the crowded Bosporous shipping lanes, is also a distinct possibility.

Continental Pipeline Systems


The worlds two major continental crude oil pipeline systems have been built over the last century in North America and the former Soviet Union. Pipelines provide the key, and sometimes the only export outlet for Russian and Canadian crude oils. These pipeline export volumes of about 2.5-million b/d amounted to some 10% of the international crude oil trade in 1995. Long periods of political stability, welldeveloped oil industries, and the benefits of huge integrated systems spanning long distances all contributed to the growth of these networks. Russias primary export network the Druzhba, or Friendship, line is an artifact of the old Soviet Empire that serves almost all of Eastern Europe. It extends from the main refining center of Kuybyshev in the Volga-Urals region into western Russia and Belarus, where it splits into three branches: one taking crude oil north to the Baltic export outlet of Ventspils, one to Poland and Germany, and one further south to Hungary, Slovakia, and the Czech Republic. Another long-haul pipeline system transports export crude oil from Kuybyshev to the Black Sea for loading mainly at the Russian port of Novorossiysk. This system also serves the Ukrainian port of Odessa. Russias ability to export crude oil is sometimes constrained by the size of its pipelines and terminals, which leads to competition for pipeline space in monthly awards of capacity to producers. As part of the new CPC line from Kazakstan, the pipeline capacity serving Novorossiysk is to be expanded significantly by 1998. Western Europes crude oil pipelines are modest compared to the size of its oil industry. But with the end of the Cold War, the first link from west to east has now been forged, and others may follow. The 340-km Mero pipeline from Ingolstadt in Germany to the refineries of Kralupy and Litvinov in the Czech Republic opened in 1996, giving these refineries an alternative to Russian crude oil. Like the Adria pipeline further south, the 200,000 b/d line brings Mediterranean crude oil into Eastern Europe. In addition to the subsea lines serving North Sea production areas, Europes largest crude oil pipelines were built mainly to link refiners in southern Germany, Austria, Switzerland, and central France to Mediterranean ports (see map on the opposite page). However, not all of this capacity is needed due to reductions in refining capacity in Germany, and the northern section of the CEL line, which runs across Switzerland and into Germany, was closed in 1995. Western Europes extensive barge network and reliance on coastal refineries has tended to reduce its need for long-haul pipelines.

CRUDE OIL HANDBOOK

Key European Crude Oil Pipelines

LEGEND: CONTINENTAL LINES


Adria CEL Central European Line Druzhba SPSE Southern European Line TAL Trans Alpine Line Mero Black Sea Line

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LEGEND: NORTH SEA LINES TERMINAL/LANDING POINT CRUDE Sullom Voe, UK Brent Flotta, UK Flotta Cruden Bay, UK Forties Teeside, UK Ekosfisk Strue, Norway Oseberg

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Edmonton TransMountain

North American Crude Oil Pipelines


The huge North American pipeline grid serves two basic purposes. It brings landlocked crude oils in Alberta, Alaska, West Texas, and elsewhere to the main refining centers through such pipelines as the Trans-Alaska Pipeline System and the Interprovincial-Lakehead system. It also pulls in imported crude oils to inland US refineries through systems such as Capline. With the exception of the Trans-Alaska Pipeline System, which is just one link in the long supply chain from the North Slope to refiners, the North American crude oil pipeline network feeds both domestic and international oils directly to refiners. The operation of all of the major longdistance pipelines is fairly similar, with well-established government regulations in both the US and Canada. While access is open to all, pro-rationing of capacity occurs among users if there is not enough space in a line to handle all of the volume that needs to be shipped. Flexibility is provided by storage at terminals, pipeline hubs, and refineries. Capacity is usually allocated on a monthly basis, and pipeline users typically face a deadline for nominating their volumes of about five working days before the end of the month to ensure smooth scheduling. A key bottleneck in the US pipeline system in the early 1990s has been the route from the Gulf Coast to the key Midcontinent hub of Cushing, Oklahoma, the US crude oil futures market delivery point. As domestic production has declined, dependence on international crude oils has increased, requiring additional capacity in periods of market tightness. A major addition in 1996 more than doubled capacity to some 500,000 barrels a day through three different pipes: the 70,000 b/d Texaco line that runs from Houston via Wichita Falls; the 160,000 b/d Arco Seaway line from Texas City; and the latest addition, the 270,000 b/d Arco Seaway line from Freeport, Texas. (See discussion of the West Texas Intermediate market, pB15.) While this eases the pressure on Cushing, the need for expanded lines into the Midwest is likely to grow as domestic output falls and US demand rises in the years ahead. The pipelines shown in the map above are just the primary links in the system, reflecting the largest-volume shipments. These are mainly targeted at the Midwest,

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converging on the Chicago area. They bring in Canadian crude oil from Alberta, domestically produced crude oil from the Southwest, and international supplies from the Gulf Coast. The Four Corners Pipe Line and All-American line provide an outlet for extra crude oil on the West Coast, but they are relatively small in volume. The Trans Mountain Pipe Line in Canada provides a similar West Coast outlet for Alberta production. A pipeline across the Isthmus of Panama has provided a valuable shortcut for shipments of Alaskan crude oil from the Pacific to the Caribbean, feeding US refiners on the Gulf and East Coasts. But with the lifting of the US ban on exports of Alaskan North Slope crude oil, its future came into doubt in 1996. The advantage of the line is that it allows the crude oil to bypass the canal and move more easily to market, but the need for such shipments had declined significantly even before the US ban on ANS exports was lifted. The greatest potential for the line in the future may lie in reversing it to allow Venezuelan and Mexican crude oil to be exported west to Asia more easily.

The Key Suez Nexus


Suez has long been a critical nexus for the oil industry, linking the dominant Mideast producing area with European markets. Two pipeline systems link the Red Sea to the Mediterranean, supplementing the Suez Canal, which cannot handle fully laden VLCC-sized tankers, and shortening the long voyage from the Mideast to Europe and the Americas. These lines, which run through Egypt and Israel, were both expanded in the early 1990s to a combined capacity of 3.6-million b/d. The main Sumed line was used at or near capacity in 1992-93 due to attractive tariffs and growing sales of Mideast crude oil into the Mediterranean. The longunderused Israeli Tipline has also been revived for international use with the improving

Turkish Export Line

Major Mideast Crude Pipelines

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political situation in the region. Both lines can handle VLCC-sized cargoes easily, overcoming the draft restrictions of the Suez Canal, and large ships also have the flexibility of discharging some of their cargo in one of the pipelines and then using the canal to carry a partial load (see map,p11). With the growth of delivered crude oil sales by producers in the Mideast, the northern terminal of the Sumed line at Sidi Kerir has become an important sales outlet for Saudi and Iranian grades.

Operational Peculiarities Of Pipelines


Pipelines, like tankers, have their own operational peculiarities. While they can be tremendously efficient, pipeline use also results in some inevitable mixing of crude oil grades. The barrels that a company puts into a line at one end are often not the exact same ones that it gets out at the other end. The resulting changes in quality are of little consequence when a line is dedicated to one crude oil stream, such as ANS or Arabian Light. But when a wide range of crude oils is used, the variation can be significant. A system of quality adjustment is generally used to offset these variations, and adequate storage allows for varying streams to be more easily segregated. US pipelines have developed sophisticated quality-banking systems, which compensate pipeline users for changes in gravity and sulfur when its crude oil is moved through a pipeline. Terms are specified, and the pipeline user knows before shipping exactly what kind of value adjustment will be made for changes in quality. Russian pipelines are only just beginning to develop the flexibility to deal with such variations in quality. Advance scheduling and the trading of ratable volumes over a period of a month or longer are also key examples of how pipeline crude oils contrast with the international cargo trade. Trading commitments in pipelines are generally firmed up in advance, with little latitude after that for further trading. By contrast, crude oil cargoes can be traded even after they are on the water.

Major Pipeline Links


The table on page D13 profiles the major pipelines that are used in international crude oil trade. There are also comprehensive gathering systems in all of the main producing regions, and much more extensive internal networks in North America and the former Soviet Union. Most of these domestically oriented lines have been excluded since they lack direct involvement in international trade. Distances are shown in both kilometers and miles, with capacity in 1,000 b/d.

Inventories: The Swing In The System


Global crude oil inventories are both an integral part of the supply system and a key shock absorber to that system able to offset both large and small supply deficits. Crude oil inventories perform such mundane operational tasks as providing pipeline fill, tank bottoms, and oil in transit at sea, allowing smooth logistical operations. Although these operational oil inventories are large, usually accounting for over 80% of global oil stocks, they are far less important to the immediate direction of oil prices than the much smaller volume of discretionary stocks. Companies can use the latter at will, and this has a direct impact on markets and prices. Although oil stocks are notoriously difficult to measure, all market participants implicitly take a view on the level of discretionary oil-company stocks and their likely trend up or down when they make judgments about the future direction of oil

CRUDE OIL HANDBOOK

Region/Pipeline Mideast Petroline Turkish Export Line Sumed Tipline

MAJOR PIPELINE LINKS IN WORLD CRUDE OIL TRADE


Country Saudi Arabia Iraq, Turkey Egypt Israel Operator/Owner Saudi Aramco INOC-Botas Arab Petroleum Pipeline Co., Egypt (50%), Saudi, UAE, Kuwait, Qatar EAPC Operator/Owner Transneft and others From / To Abqaiq / Yanbu (Red Sea) Kirkuk (Iraq) / Ceyhan (Turkey) Ain Sukhna (Red Sea) / Sidi Kerir (Med.) Eilat (Red Sea) / Ashkelon (Med.)

Length km (miles) 1,270 (789) 1,049 (652) 320 (199) 241 (150)

Capacity 1,000 b/d 4,800 1,600 2,400 1,200 1,000 b/d 1,400 700 700 720 656 180 200 200 1,000 b/d 2,000 1,470 730 470 550 1,200 860 220

Europe Country Druzhba (Friendship) Russia, Belarus, Ukraine, Hungary, Slovakia, Czech Republic, Poland, Germany TAL Italy, Austria, Germany SPSE France, Germany CEL Italy, Switzerland, Germany Adria Croatia, Hungary, Slovakia Mero Germany, Czech Republic Americas Taps (Trans-Alaska) IPL-Lakehead Country USA Canada, USA

Trans-Alpine Line Societe Du Pipeline Sud-Europeen Central European Line State-owned Mero/Chemopetrol

From / To km (miles) Kuybyshev (Russia) / Mozyr (Belarus), then 1,380 (861) north to Schwedt (Germany), south to 1,100 (683) Litvinov (Czech Republic) 1,475 (916) Trieste (Italy) / Ingolstadt (Germany) 450 (280) Fos/Lavera (France) / Karlsruhe (Germany) 782 (486) Genoa (Italy) / Ingolstaat (Germany) 753 (468) Omisalj (Croatia) / Bratislava (Slovakia) 663 (412) Ingolstadt (Germany) / Kralupy (Czech Republic) 340 (212) km (miles) 1,226 (762) 1,826 (1,135) 1,183 (735) 909 (565) 1,006 (625) 1,094 (680) 130 (81) 788 (490)

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Loop-Capline Trans-Panama Cano Limon

USA Panama Colombia

Operator/Owner From / To Alyeska (British Petroleum, Arco, Prudhoe Bay / Valdez Exxon, Mobil, Phillips, Unocal, Hess) Interprovincial Pipe Line Edmonton (Canada) / Duluth (USA), then south via Chicago or north via Bay City, Michigan (USA) to Montreal (Canada) Louisiana Offshore Oil Port and Shell Loop, St. James / Patoka, Illinois Petroterminal De Panama Puerto Armuelles / Chiriqui Grande Occidental Cano Limon / Covenas

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prices. The strategies that companies take as a group toward these discretionary stocks determine much of the incremental oil volume that reaches the market, and in turn drives price levels. A key development on the inventory front in the mid-1990s has been the effort to operate on reduced inventories, which brought stocks in the US and other key areas to record low levels in the spring and summer of 1996. This drive toward lower inventories reflects both structural and temporary factors, and it can be expected to add to the overall volatility of oil prices as the market is forced to cope with the imbalances through changes in prices. Among the structural reasons for the decline in stocks are cost reductions by oil companies, streamlining of operations, and rationalization of facilities requiring less in operating stocks and perhaps greater reliance on futures markets and derivatives. Among the temporary factors that contributed to the further decline in stocks in early 1996 were a cold winter, supply disruptions, and expectations that a return of Iraq to the market would add significantly to global supplies later in the year. Worldwide crude oil stores can be divided up into a number of different categories that are almost all far easier to define than to measure accurately. Because of crude oils use as a feedstock, virtually all crude oil stocks are part of primary inventories, with secondary and tertiary stocks devoted to refined product distribution and consumption. Of these primary crude oil stocks, there are two basic groups: commercial, or industry stocks; and strategic, or government-held stocks. The discretionary, or usable commercial stores that have such a big market impact are generally in the hands of the oil companies. The stocks held in overseas storage by producer governments such as Saudi Arabia, Iran, and Kuwait sometimes blur the traditional distinctions between commercial and strategic stocks because they are used operationally for delivered crude oil sales, but they also have been built up at times for strategic reasons. At the end of 1995, total global oil inventories outside the former Soviet Union and China amounted to some 5.785-billion barrels, or 87 days of forward demand cover, according to PIWs Oil Market Intelligence. That compares with over 90 days of forward demand cover a year earlier, indicating the trend toward holding lower inventories. Of the total, about 1-billion barrels were strategic stocks held by consumer country governments, and around 4.73-billion barrels, or 71 days of forward demand cover, were commercial stocks held by companies. Of those commercial stocks, only about 730-million barrels, or 11 days of forward demand cover, were usable commercial stocks, in the sense that companies could draw on them without disrupting their operations or cutting into the volumes that they are required to hold by some governments for security reasons. Movements in discretionary inventory can influence the market as both a source of extra supply and extra demand, with companies choosing either to draw down or build up their stores, depending on market circumstances. Forward prices themselves also send definite economic signals to companies about building or drawing their stocks. This interaction between stocks and prices reflects a perpetual balancing act that has become much more efficient in oil markets with the development of forward and futures trading. When futures prices are higher than prompt levels, markets are in contango, and if the gap between the two is wide enough to cover storage costs and interest, there is a strong incentive for companies to

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build stocks. The reverse relationship, with high prompt prices, is a backwardation, and it creates an incentive to destock.

Commercial Inventories
The worlds commercial crude oil stocks are held mainly at production facilities and in pipelines, on tankers at sea, and at refineries. These inventories are somewhat seasonal, depending on refinery needs, but they vary less over the year than they used to. Commercial crude oil stocks have usually fluctuated much less than refined product inventories, which are more sensitive to final demand. There are obviously minimum levels of stocks at all of these points in the supCARIBBEAN CRUDE OIL ply chain that are required to keep the sysSTORAGE TERMINALS tem moving smoothly. That minimum level (Crude Capacity In Million Bbls) was fairly constant in the past, changing only Independent Name Location Capacity slowly over time, but efforts to cut back on Borco (PDV) Bahamas 6.5 stocks may allow the system to operate effiS. Riding Point Bahamas 5.2 ciently at a significantly lower level of stocks. Wickland Aruba 10.0 In addition, many countries in Europe and Statia Terminals St. Eustatius 5.0 Total 26.5 elsewhere do not hold segregated strategic Other* stocks but require companies to hold a minBonaire (PDV) Bonaire 8.3 imum obligatory level of extra stocks. The Curacao (PDV) Curacao 10.0 requirements are usually measured in terms Hess US Virgin Islands 16.0 Petrotrin Trinidad 8.0 of a firms sales volume, and are in effect part Total 42.3 of the minimum base level. Discretionary or *Not usually open to third-party storage. usable commercial stocks are any inventories above these levels. In practice, despite the policy of oil companies in recent years to operate with the lowest possible level of stocks, usable commercial stocks have rarely dropped below 10 days of forward demand cover, according to PIWs Oil Market Intelligence. Independent storage terminals provide tankage that is rented commercially to third parties, and thus these volumes can be a key indicator of trends in discretionary, or usable commercial stocks. While some of the oil held in independent storage is for operational purposes, these facilities are designed to be used by traders and others needing temporary storage beyond their usual operational requirements. About 26-million barrels of crude oil storage at terminals in the Caribbean is open to third parties, with about double that volume held at other facilities there that is committed on a more exclusive basis to specific term customers, consisting mainly of producer governments (see table above). The US Gulf Coast and Rotterdam areas also have significant independent storage capacity. Rotterdam has about 25- to 30million barrels of crude oil storage that is specially dedicated to in-transit bonded storage outside of European Union customs.

Strategic Stocks: Seldom Seen


Over 1-billion barrels of crude oil is now held by governments around the world as a strategic buffer against supply disruptions so serious that industry stocks alone cant handle them. These stores undoubtedly provide a measure of psychological security for the oil markets and reduce the need for oil companies

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to carry extra inventories as insurance against a loss of supplies. But the central unresolved question that has existed almost since the inception of strategic stocks remains: When should they be used? The largest stockpile is the US Strategic Petroleum Reserve, which is held in underground salt caverns on the US Gulf Coast. It holds about 575-million barrels, and it has been drawn down slightly to pay for operational improvements. The next-largest reserve at the end of 1993 was Japans almost 300million barrels, held in onshore tanks by state JNOC. Germany and some other European governments also hold small stockpiles themselves in addition to compulsory stocking requirements for their companies. Among non-OECD countries, South Africa has been cutting back its stockpile, which once stood at some 48-million barrels. South Korea also has a government-held strategic stockpile. The International Energy Agency, which coordinates the efforts of OECD countries to respond to oil-supply emergencies, has drawn up specific plans for the withdrawal of strategic and compulsory stocks. In practice, however, the decisions to use these stocks are mainly determined politically. The only instance of a release of OECD strategic stocks due to an emergency was during the 1990-91 Gulf conflict. The US and the IEA initially resisted releasing strategic stocks during the autumn of 1990, when anxiety was greatest about the future availability of oil supplies and prices were soaring. They argued that since there was no visible shortage of supplies, it was premature to draw down these stocks, despite rocketing prices. A small test of the US stockpile release system was conducted that autumn, and a coordinated sale was announced immediately after the start of the air offensive against Iraq. This was quite successful in helping to ease market fears of potential supply disruptions and spurred an immediate drop in prices. However, the actual release of stocks was confined to the US SPR and was much smaller in volume terms than the oil made available at the same time from floating stocks by Saudi Arabia and Iran. Governments also face temptations to use strategic stocks for other purposes, something they have succumbed to in the US, South Korea, and South Africa in recent years. For example, in the spring of 1996, the US accelerated a planned operational release of SPR inventories in order to control a politically unpopular rise in gasoline prices. In South Korea, the government has lent inventories to refiners during cold winters in order to allow them to supply additional products locally without being forced to pay high prices on the international market, thereby putting pressure on the balance of payments and the currency. In South Africa, the lifting of UN sanctions has prompted a steady drawdown of strategic stocks that has been geared to coincide with periods of relative market strength. However, these drawdowns seem to have been largely completed. The stocks of the former Soviet republics and China cannot yet be tracked in a systematic way due to a lack of available data, but they can have a significant impact on world markets. In both cases the swings seem to reflect imbalances created by controls on trade and artificial internal pressures. These should decline to the extent that these countries move toward more open free-market systems.

Into The Refinery


The storage and transportation systems described above are all designed for the smooth delivery of crude oil to refineries, where the feedstock can be turned into usable products. It is this process that determines the ultimate value of a crude oil and is the subject of the next and final chapter of the first section of the handbook.

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REFINING

Whats A Crude Oil Worth?


Regardless of the day-to-day vagaries of crude oil markets, the values of all grades, and hence the prices reflected in markets, ultimately depend on the refined products that can be made from individual grades. Crude oils have little value in and of themselves except that they can produce refined products that can be used by final consumers. Each refined product that can be produced from a barrel of crude oil has its own separate markets, which are driven by their own complex interactions of supply and demand. Thus, each grade represents a composite of all of these markets, a composite that is unique to each grade because of the variation in the mix of products that each grade yields. Unlike most other commodities, there is no dominant end use for oil. Rather, there are a host of competing co-product uses. The refining process is the technical means by which crude oil output is reshaped to fit the final product needs of oil consumers, and it has developed considerable flexibility since the late 19th century, when it was focused almost exclusively on kerosine production. The individual refined product markets are driven by a wide range of factors, including local product demand trends, interfuel competition, environmental regulations, inventory levels, weather, and refinery capabilities. A full analysis of this interaction goes beyond the scope of this book. In this chapter, the focus is more narrowly on the basic characteristics of crude oil and how they relate to refining and the valuation of grades. Refinery technology offers a broad spectrum of tools for breaking down crude oil into the products that consumers want. With various markets requiring distinct mixes of products from different combinations of crude oil feedstocks, a wide variety of refinery configurations has developed over time. The most basic distinction that is often drawn between types of refineries relates to their complexity. A simple refinery involves only the distillation or boiling of the crude oil and relatively few other processes, yielding large volumes of residual fuel oil, especially from heavier grades. More complex refineries use various upgrading processes and yield larger volumes of higher-value light products such as gasoline. The distinction between simple and complex refining is a relative term, with no exact specification for each category. However, the oil industry usually thinks in terms of three basic levels of complexity. A simple refinery today involves distillation of the crude oil plus some common secondary processes that enhance the output of gasoline and diesel. A complex refinery takes the secondary processes a step further by using the gas oil and residue from the refining process as feedstock to make more light products such as gasoline and gas oil. These additional secondary processes include cracking and alkylation. A highly complex refinery simply adds more sophistication to these processes, eating up even more of the heavy products through coking and other technologies. Some highly complex refineries are integrated with sophisticated petrochemical plants or lubricants plants that can also significantly enhance the value of a crude oil. Due to regional differences in oil demand, the complexity of refineries tends to vary around the world. Most of the simple refineries are in Asia, the former

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Soviet Union, and developing countries, where demand for light products is not great and where significant volumes of residual fuel are still used for power generation. The most complex refineries tend to be in markets such as the US, where gasoline demand accounts for almost one-half of all oil consumption. Western Europe generally has complex refineries, but most are not as sophisticated as those in the US, and product output is weighted more heavily toward gas oil than in the US. There are, of course, important exceptions to these broad generalizations, particularly in the developing world, where oil-producing countries such as Venezuela, Saudi Arabia, and Kuwait have made extensive investments in highly sophisticated refineries in order to add value to their own crude oil flows by exporting large volumes of higher-value light products. Although Japan is an advanced industrial economy, it has relatively simple refineries. This is due mainly to the structure of domestic product demand and the past protectionist government policies toward the countrys refining industry. In Asia in particular, many of the most rapidly developing countries are moving toward greater refinery sophistication in an effort to keep up with quickly expanding demand for light products, especially middle distillates. To illustrate the regional variation in refining capabilities, the chart and table show various yields for Arab Light grade (see pH227). These range from simple distillation to a highly complex configuration. COMPARING YIELDS FOR ARAB LIGHT The simple yield is fol100% lowed by representative incremental yields for Light Ends 75% Rotterdam, which is somewhat complex, and Mid-Distillates 50% the US Gulf Coast, which is the most complex of 25% the main regions. The Residue output of residual fuel 0% declines progressively as Simple Rotterdam US Gulf Highly the sophistication of the Complex refinery increases. The yield of higher-value light Products Simple Rotterdam US Gulf Highly Complex products grows, but the Light Ends 11.7% 28.1% 51.6% 59.0% Mid-Distillates 32.8 33.0 18.4 28.0 cost of the additional Residue 45.0 33.4 27.5 6.0 processes needed to make them is also higher. This *Plus 4.9% coke. basic trade-off lies at the heart of most major refinery investment decisions. The regional yields shown here were developed by PIW to track refinery profitability in the main product markets around the world by calculating the incremental product output of individual crude oils from representative regional refinery configurations.

A Look At The Refining Process


All of the various upgrading technologies are designed to maximize the product output from a barrel of crude oil, but the starting point of the process is always the same at every refinery: the distillation of the crude oil. This simply involves

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heating the crude oil to gradually higher temperatures, which allows various types of hydrocarbons to boil off at different points, thus breaking the crude oil into purer products with similar chemical properties. At each temperature level, or cut point, a fraction of the crude oil reaches its boiling point, and these vapors are distilled into a specific category of refined products. The determination of the cut points depends both on the characteristics of the crude oil and the quality of the product being produced, which means that in practice there can be considerable variation. For example, kerosine, which is produced mainly from straight distillation and is prized for its purity when used as aircraft fuel, has cut points that range from an initial boiling point of 320350 degrees Fahrenheit (160-176 centigrade) to a final cut point of 450-600 degrees Fahrenheit (232-315 centigrade). At these temperatures, kerosine boils off and is segregated from the other oil products. The products with the lowest boiling points are liquefied petroleum gases, which vaporize at normal atmospheric temperatures, followed at progressively higher temperatures by gasoline, naphtha, kerosine, gas oil, and finally unboiled residue which, in a simple refinery, usually ends up as residual fuel oil. Beyond the primary distillation level, some of the resulting products are used as feedstocks for secondary processes, while others, such as kerosine, are simply used as they are or blended with still other products to provide the right quality supply for the market. Some of the simplest secondary processes are reforming, which converts certain types of naphtha into gasoline, and hydrotreating, which removes sulfur from gas oil and residual fuel. There are several variations to these technologies, which are all fairly common in the simple refineries described above. Reforming in particular is widely used because of the importance of gasoline in many markets. Types of naphtha with relatively high content of hydrocarbons known as naphthenes, which are readily broken down into high-octane aromatic compounds by the reforming process, are best-suited for reforming into gasoline. In contrast, highly paraffinic naphthas are usually preferred as feedstocks for petrochemical manufacturing. Naphtha with 40% or more naphthenes and aromatics is usually defined as naphthenic or N+A naphtha, while naphtha with less than this amount is considered paraffinic. Cracking is a more complex process that can involve several stages, which together are designed to break lighter gasoline and gas oil fractions out of heavy gas oil and certain kinds of residue. The two main cracking technologies are catalytic cracking, or cat cracking, and hydrocracking. Both produce gasoline and gas oil, but hydrocracking is more sophisticated and is sometimes preferred for making middle distillates because it can produce kerosine as well as gas oil. In both, the residue and sometimes heavy gas oil from the distillation process, known as straight-run gas oil or resid, must be put through a vacuum distillation unit to prepare it for cracking. This unit simply distills the residue again at a lower atmospheric pressure, creating feedstock that is suitable for cracking, and that is known as vacuum gas oil, or VGO, and residue or vacuum bottoms that must go to the residual fuel oil pool. In a catalytic cracker, or cat cracker, the VGO feedstock and straight-run gas oil are combined at high temperatures with a chemical catalyst that helps release the lighter hydrocarbons, leaving heavy, cracked residual fuel as a by-product. In a hydrocracker, much the same thing happens, but hydrogen is also mixed in, which allows the creation of even more light hydrocarbons and eliminates the cracked residue that is left over in cat cracking. In both cracking technologies, the refiner has scope to alter the range of the end products to tilt toward gasoline or gas oil. By changing the intensity or severity

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of cracking, the refiner can shift a sophisticated units output, adding flexibility to the refining process. The output of these crackers often requires some special further processing at alkylation, isomerization, or reforming units to help maximize the output of gasoline. The most sophisticated form of upgrading is coking, which involves the destruction or complete transformation of the residue. Coking relies on intense heating of residue usually the cracked residue that is already left over from the cat cracker and rapid movement of the oil through a special coking drum where the solid petroleum coke that is produced can be managed and removed, while the lighter gasoline, naphtha, and gas oil fractions boil off. The process requires high heat and special technologies but no AN OVERVIEW OF KEY UPGRADING TECHNIQUES catalysts, and the coke, Process Feedstock(s) Output which is used mainly in Reforming Naphtha Gasoline industrial processes, is Vacuum Distillation Straight-Run Residue Vacuum Gas Oil, Residue Catalytic Cracking Vacuum Gas Oil, Gasoline, Gas Oil, effectively the only residue. Straight-Run Gas Oil Cracked Residue Thermal cracking and visHydrocracking Vacuum Gas Oil, Gasoline, Kerosine breaking are similar techStraight-Run Gas Oil Gas Oil nologies, but they are less Visbreaking Cracked Residue Some Gas Oil severe and still leave conand Residue siderable volumes of Thermal Cracking Cracked Residue Light Products (Mainly Gasoline) and Residue residue. Thermal cracking Coking Cracked Residue Light Products and Coke is an earlier, more primitive form of the coking process that is mainly geared toward gasoline production from residue, while visbreaking is a less severe form of thermal cracking that extracts a small volume of gas oil from the cracked residue feedstock. The feedstocks that are used in the upgrading units have become increasingly important in refinery operations as the amount of upgrading capacity has grown. These feedstocks now trade in active markets of their own. When the values of key feedstocks such as vacuum gas oil and straight-run residue are relatively depressed, the economics of operating upgrading units are good. But when supplies are tight, as they have been in recent years, upgrading economics become problematic.

Selecting And Valuing Crude Oils


Depending on the hardware that a refiner has available and the needs of the downstream market that is being supplied, certain types of crude oils will be more or less attractive depending on their individual characteristics. Obviously, the grades that provide the highest profit margin are likely to find the most favor, but as described in earlier sections of this book, some companies have term-contract supply arrangements or equity crude oil production that tends to tilt their downstream refining systems toward certain grades. These are often considered baseload crude oil supplies, and refineries are usually designed with a specific grade or mix of grades in mind. Thus, there are plants that are geared toward light, sweet grades and plants geared toward heavy, sour oils. The latter contain the best upgrading units to deal with the specific characteristics of those grades and maximize their product output. While most refiners can count on certain baseload volumes, many are also constantly evaluating their crude oil supply mix and the options available to

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them to squeeze an extra bit of profit out of their plants. Their decisions to refine these extra incremental volumes are driven by signals from the spot markets for crude oil and refined products, and they can in turn have a big impact on these markets. The incremental refining economics for each refiner are a bit different because of the varying configurations of their plants and their differing abilities to handle specific grades. But in all cases, the incremental barrels face lower costs, because it is assumed that the basic costs of owning and operating the plant are covered by the baseload volumes. In addition, the refinery generally cannot take full advantage of its upgrading potential with incremental grades because some of its units are already fully loaded with baseload crude oil supply volumes. PIWs system for tracking refined crude oil values, or netbacks, provides a good example of the incremental refinery economics that are so crucial to spot markets, and it also illustrates the kind of calculation that a refiner goes through to determine whether it is profitable to refine incremental crude oil supplies. A refinery netback is an oil industry term for the value of a specific crude oil based on the products that can be produced from it, less the cost of refining it and transporting it from its port of loading. The netback value can be compared with the price of the crude oil in the spot market or, for term-contract supplies, to determine the trend in refinery profit margins. These netback values for selected grades appear in every issue of Petroleum Intelligence Weekly and monthly in Oil Market Intelligence, and they are based on representative regional yields developed by PIW for individual grades. Unlike the incremental yield of an individual refinery, they represent a composite for a key refining center such as Rotterdam or the US Gulf Coast. These yields have been updated over the years to reflect the changing technical capabilities of refineries and shifts in the qualities of crude oils. The table on page pE6 shows the latest yields, which were updated in 1996.

Calculating A Netback
Heres how the PIW netback calculation works. The first step in assessing oil market economics is to compute the weighted average value of all refined product components from a barrel of crude oil at the refinery gate. In trade jargon, this is known as the gross product worth, or GPW. This is determined by multiplying the prevailing spot price for each product by its percentage share in the yield of the total barrel of crude oil. Following is a sample calculation of the gross product worth of a barrel of Arabian Light crude oil refined at the US Gulf Coast, with the resulting products sold at spot market prices. The value of the fuel oil portion of the yield is partly determined by its sulfur content. Therefore, an adjustment must be made when the sulfur level of the fuel oil produced from a given crude oil differs from the prevailing quality of fuel sold in the spot market. Generally, a refiner will blend fuels of various qualities to meet market needs. And higher-quality, low-sulfur residues have become particularly attractive because they can be used as feedstock for upgrading units. In order to reflect this, the PIW netback calculation assumes that for higher-sulfur grades refiners receive a blending credit or debit of 50% of the value of each percentage point of sulfur, while for low-sulfur fuel oil the credit or debit is 200%. The actual octane produced by a crude oils gasoline cut also differs from spot market grades, and a credit or debit is applied to reflect this difference. This octane adjustment is only used in the US because of the importance of gasoline yields, and it is based on the cost of natural gasoline.

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To make comCALCULATING THE PRODUCT YIELD parisons between the value of prodArabian Light Crude Oil At Typical US Gulf Coast Refinery, October 1996 ucts that can be US Gulf Coast Spot Prices Product Yield Value Of Product Cents Per Gallon Per Barrel (Volume %) Yield processed from a Regular Unleaded Gasoline* 64.49 27.09 39.90% 10.81 barrel of crude oil Jet Kerosine 70.26 29.51 8.20 2.42 at the US Gulf Coast Gas Oil / No.2 Heating Oil 69.37 29.14 24.70 7.20 or another major Fuel Oil 1% Sulfur 19.47 0.00 0.00 refining center and 3% Sulfur 19.26 23.70 4.56 the price of that Actual Sulfur Content, 3.49% grade at the proFuel Oil Adjustment -0.10 Actual Octane, 85.63 ducers loading Octane Adjustment -0.14 port, the costs of Total Value Of Arabian Lights Product Yield (GPW) 24.75 transporting and *87 octane. Note: Fuel oil adjustment based on a debit from 3% spot grade based on 50% refining the oil of the slope between the 1% and 3% prices. Octane adjustment based on a debit that must be deducted. reflects the extra cost of raising the octane to that of unleaded regular, based on the average octane differential between unleaded regular and natural gasoline on the Gulf Coast. In the case of crude oils that are sold on a delivered basis, such as Russian Urals in Europe (see pH221), only refining costs need be deducted. In some cases special tariffs, duties, and port charges and other fees must also be deducted. These are particularly significant in the US. Since the PIW netback model is attempting to assess CALCULATING FREIGHT & DELIVERY COST the economics of refining Voyage Ras Tanura, Saudi Arabia to Beaumont, Texas the incremental rather than Flate Rate Per Metric Ton $18.08 the average barrel of crude converted at 7.38 bbls per ton Per Barrel Of Arab Lt. $2.45 oil, transport and refining Spot Freight Rate Worldscale Points 53 Spot Freight Cost costs also are figured on a 53% of flat rate Per Barrel $1.30 marginal basis. For crude oil Transshipment/Lightering Costs Per Barrel 0.34 transport, this represents the Other Costs Per Barrel 0.28 Total Costs Per Barrel 1.92 cost of chartering an appropriately sized tanker on the Note: Other costs include US customs tariff of 11, Super Fund fee of 10, and other state and local fees of 7. spot market for a single voyage, as opposed to the cost of operating refiner-owned vessels or chartering ships for an extended period. The yardstick used to calculate the freight cost for a single voyage is known as the flat rate and is set by Worldscale, a trade association that publishes a base or 100 rate for voyages between each oil loading and receiving port. Daily tanker market fluctuations are measured in Worldscale points, which are a percentage of the stanTHE NETBACK VALUE dard flat rate. The cost of a Total Refined Value Of Arabian Light (GPW) $24.75 Less: charter at Worldscale 60 Incremental Refining Cost -0.35 would be 60% of the flat rate. Freight & delivery Costs -1.92 For US Gulf deliveries, other Implied f.o.b. Value Of A Refined Barrel Of Arabian Light $22.48 costs of transshipment or lighNote: Incremental refining cost represents additional out of pocket operating tering as well as tariffs and cost to refiner of running an additional barrel on top of baseload volumes. fees must also be deducted.

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Marginal refining costs are defined to include only running costs, with no allowance for depreciation of the original capital in-vestment in the plant. The PIW model assumes that they are 35 a barrel for a US or European refinery and 25 elsewhere. A portion of the crude oil yield is assumed to be refinery fuel, and another small amount is assumed to be lost during the refining process. The entire netback calculation now comes into focus: Upon subtraction of freight and refining costs, spot product prices are translated into an equivalent crude oil value at the loading port of origin, known as the f.o.b. netback. It provides a gauge of what a crude oil is worth at the point of sale to a typical refiner in a specific downstream center.

The Profitability Of A Grade Of Crude Oil


The implied profit or loss for the refiner can easily be derived by comparing the price of the crude oil in the spot market with its netback value (see bottom box on pE6). If the netback value exceeds the cost of the crude oil under PIWs yield and (Please turn to pE9)

PIW PACESETTER CRUDE OIL YIELDS BY VOLUME


US GULF COAST INCREMENTAL YIELDS AT TYPICAL REFINERIES Regular Crude Oil Unleaded Arab Light 39.9% Arab Heavy 36.8 Dubai 38.4 Kuwait 39.8 Bonny Light 44.9 Forcados 34.6 Brent 46.7 West Texas Intermediate 48.1 West Texas Sour 45.5 Maya 33.2 Isthmus 42.4 Saharan 48.8 Louisiana Light Sweet 44.7 Cusiana 47.9 Regular Crude Oil Unleaded Arab Light 48.8% Arab Heavy 40.1 Dubai 46.6 Kuwait 47.3 Bonny Light 53.0 Forcados 46.4 Brent 56.5 West Texas Intermediate 57.5 West Texas Sour 51.5 Maya 35.7 Isthmus 49.7 Saharan 55.7 Louisiana Light Sweet 51.3 Cusiana 55.0 Jet Kerosine 8.2% 6.7 8.5 7.5 7.8 10.3 8.0 8.1 7.8 ... 8.2 9.4 7.8 8.6 Jet Kerosine 5.6% 5.5 7.2 6.4 6.3 7.7 6.0 5.9 6.2 ... 5.8 7.5 6.2 6.8 Winter Yields Gas Oil Low-Sulfur High-Sulfur No.2 Fuel Oil Fuel Oil 24.7% ... 23.7% 9.7 ... 41.6 22.7 ... 26.9 20.1 ... 28.8 39.6 4.5% ... 41.8 11.3 ... 29.8 11.6 ... 30.9 9.8 ... 23.0 ... 20.1 7.0 ... 54.7 21.0 ... 25.0 31.8 5.3 ... 35.6 10.9 ... 34.4 7.3 ... Summer Yields Gas Oil Low-Sulfur High-Sulfur No.2 Fuel Oil Fuel Oil 17.1% ... 24.5% 6.4 ... 42.7 15.6 ... 27.8 13.9 ... 29.8 32.0 5.0% ... 31.0 12.6 ... 22.1 12.9 ... 22.2 10.5 ... 18.4 ... 20.8 4.3 ... 55.3 14.9 ... 25.9 25.4 5.6 ... 28.4 11.6 ... 27.4 7.7 ... Quality Adjustments Fuel Oil Gasoline % Sulfur Octane 3.49% 85.63 4.20 85.59 3.50 86.81 4.56 86.24 0.39 87.27 0.40 88.10 0.83 86.45 0.89 86.96 3.23 87.16 4.19 85.35 3.06 87.54 0.41 86.10 1.40 87.02 0.80 86.92 Quality Adjustments Fuel Oil Gasoline % Sulfur Octane 3.49% 85.63 4.20 85.59 3.50 86.81 4.56 86.24 0.39 87.27 0.40 88.10 0.83 86.45 0.89 86.96 3.23 87.16 4.19 85.35 3.06 87.54 0.41 86.10 1.40 87.02 0.80 86.92

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PIW PACESETTER CRUDE OIL YIELDS (Cont.)


NORTHWEST EUROPE/MEDITERRANEAN INCREMENTAL YIELDS AT TYPICAL REFINERIES Premium Unleaded 12.7% 11.5 11.1 18.6 9.4 13.7 13.8 Premium Unleaded 16.6% 15.0 14.3 23.1 12.4 18.2 18.5 Regular Unleaded 8.7% 8.4 8.0 12.4 11.9 9.3 9.3 Regular Unleaded 11.3% 10.9 10.1 15.4 15.9 12.4 12.5 Winter Yields Jet Naphtha Kerosine Gas Oil 4.4% 7.7% 35.9% 4.4 5.0 31.6 4.4 7.5 23.5 4.4 8.0 37.0 4.3 7.5 28.0 4.3 7.5 28.0 5.0 7.5 36.2 Summer Yields Jet Naphtha Kerosine Gas Oil 5.6% 6.3% 29.4% 5.6 4.0 25.0 5.6 6.5 16.5 5.6 6.0 30.6 5.7 6.5 20.0 5.7 6.5 20.0 5.0 6.5 29.4 Low-Sulfur High-Sulfur Fuel Oil Fuel Oil Fuel Oil % Sulfur ... 24.3% 3.80% ... 31.0 4.36 ... 38.2 4.77 12.7% ... 1.37 ... 31.0 4.55 ... 29.2 2.92 ... 21.8 2.99 Low-Sulfur High-Sulfur Fuel Oil Fuel Oil Fuel Oil % Sulfur ... 24.7% 3.80% ... 31.6 4.36 ... 39.0 4.77 13.0% ... 1.37 ... 31.7 4.55 ... 29.9 2.92 ... 22.0 2.99

Crude Oil Arab Light Arab Medium Arab Heavy Brent Kuwait Iran Heavy Urals

Crude Oil Arab Light Arab Medium Arab Heavy Brent Kuwait Iran Heavy Urals

SINGAPORE INCREMENTAL YIELDS AT TYPICAL REFINERIES Crude Oil Arab Light Arab Heavy Dubai Iran Heavy Kuwait Oman Minas Naphtha 16.5% 14.1 16.2 16.5 16.7 15.1 10.0 Winter & Summer Yields Kerosine Gas Oil 23.2% 16.5% ... 25.1 22.8 14.5 21.6 15.0 20.2 13.3 23.3 17.7 17.2 26.6 Fuel Oil 40.0% 56.7 42.7 42.6 45.8 40.6 43.5 Fuel Oil % Sulfur 3.03% 4.37 3.13 2.62 4.20 1.30 LSWR

EXPORT REFINERIES All Seasons Country/Refinery/Crude Oil Saudi Arabia Yanbu/Arab Lt.-34 Jubail/Arab Lt.-34 Rabigh/Arab Lt.-34 Bahrain Bahrain/Arab Lt.-34 Abu Dhabi Ruwais/Murban-39 Algeria Skikda/Saharan-44 Libya Ras Lanuf/Es Sider/ Zueitina Venezuela Amuay/Bach.-17 Cardon TJ Lt.-31 Curacao TJ Lt.-31 Naphtha 5.0 17.0 24.0 10.0 10.0 25.0 Premium Gasoline 27.0 4.0 ... 10.0 20.0 10.0 JetKero 13.0 18.0 11.0 17.0 17.0 12.5 Gas Oil 30.0 33.0 14.5 26.0 43.0 21.0 Fuel Oil 26.0 26.0 48.0 33.0 4.0 28.0 Fuel Oil % Sulfur 3.50% 3.50 3.50 3.50 3.50 0.38

19.0 6.0 2.5 ...

... 27.0 33.5 25.0

7.0 ... ... ...

29.0 50.0 33.0 30.0

40.0 17.0 31.0 36.0

0.57 3.00 2.00 2.00

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cost assumptions, a refiner should be able to generate a profit by buying that particular grade and selling the resulting products in the spot market. Clearly, this applies only in a generalized sense for each market, and it is not intended as a guide to assessing the profitability of any individual plant or refiner. More important than the absolute level of profits is the trend in margins: If they are rising, refiners will be tempted to run more crude oil, and spot market demand is likely to increase. The dynamics of refining profitability at the margin create the underlying trends that are most important in determining crude oil and product prices. For example, if a crude oils netback value falls below its price, refiners will tend to shy away from it. This reduced demand will eventually bring the grades price down, or the reduction in crude oil runs by refiners will tighten downstream markets and bring product prices up.

Types Of Crude Oils And Their Characteristics


In order to determine the attractiveness of an individual crude oil for refining and compare it effectively with other grades, refiners and oil market participants rely on detailed assays of actual cargoes. These crude oil tests are performed using similar kinds of standardized techniques and scales of measurement, and through repeated testing BROAD QUALITY CLASSIFICATIONS FOR CRUDE OILS they can also show how an individual crude oil Sulfur stream is changing over Sweet Medium Sour Sour (0.0-0.5%) (0.5-1.5%) (1.5-3.0+%) time. As part of the Gravity Naphthennic High Pour descriptions of each of Light Saharan the main grades in inter40 API Ekofisk Sarir Murban national trade in the folBrent Olmeca lowing section, repreEs Sider Berri sentative assays are also Bonny Lt. provided. While not as Oseberg Oman complete as a full test, Medium Minas Flotta Isthmus these assays give the main 33 API Cabinda Arab Light characteristics that refiners Djeno Dubai and traders tend to refer to Gullfaks C. Limon Arab Medium in evaluating the quality of Forcados Oriente Iran Heavy a crude oil. The assays Bonny Med. ANS Arab Heavy come from a wide range of Duri industry sources including Shengli major oil companies, refinHeavy Belayim ers, and producing country 22 API Maya governments. They generally provide good approxiBachaquero mations of the characterisBoscan tics of the individual crude oil streams, and if the quality of a grade is known to have changed significantly since the test that is shown, this is usually noted in the profile of the crude oil. As an introduction to the following discussion of specific crude oil characteristics, all grades can be defined in terms of a handful of broad categories, depend-

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ing mainly on their gravity and sulfur content. Crude oils are usually thought of as ranging from light to heavy in gravity and sweet or low-sulfur to sour or highsulfur. These two continuums or parameters define the broad categories into which all crude oils tend to fall. The gravity of crude oils is typically measured in terms of a scale set by the American Petroleum Institute, in which lighter grades are designated by higher values. Sulfur content is usually measured in the percent by weight that occurs in the oil, with higher values indicating more sulfur. Other key characteristics for sweet grades include their pour point, or the temperature at which they begin to flow readily. High naphthenic content, which is most important in the naphtha fractions, is a critical determinant of the gasoline-manufacturing capability of a crude oil. Similarly, high paraffinic content is critical for use of naphtha in petrochemical manufacturing. The matrix above shows the broad categories of crude oil types and representative grades within each category. There are no extremely light, high-sulfur grades, and relatively few heavy, low-sulfur grades. Thus, Arab Light is only described as a light crude oil in reference to other sour grades, not in reference to the much lighter low-sulfur or medium-sulfur grades. These broad categories provide useful boundaries or groupings for comparing streams. Comparisons of specific crude oil characteristics between individual grades that fall in different categories are generally less useful than comparisons between more similar supplies within the same general group. Refiners are also in practice more likely to evaluate the relative merits of similar types of crude oils because of the basic preferences of their plants for sweet or sour grades or light or heavy grades.

How To Read A Crude Oil Assay


Beyond the broad distinctions provided by measures of crude oil gravity and sulfur content, there are a host of other tests that apply to both the raw or whole crude oil and to the various cuts of refined product that can be separated through straight atmospheric distillation. The characteristics of these various refined fractions provide good indications of their suitability for use as finished products or as feedstocks for secondary refining processes. Among the most important tests of the raw crude oil are those for pour point and viscosity. Both provide indications of how easy the crude oil is to handle and refine. As mentioned above, the pour point is the temperature at which the grade pours easily. Grades that are high in wax, such as Libyan Sarir, Angolan Cabinda, and Indonesian Minas (see pH155,H33,H125), have relatively high pour points because the wax in them tends to solidify at atmospheric temperatures, making them more difficult to handle both in pipelines and on ships. Viscosity is a measure of how well an oil flows above its pour point. At higher temperatures, crude oils tend to flow more easily, and hence their viscosity declines. There are two basic parameters in measuring viscosity: the temperature of the measurement, and the viscosity index. There are five main scales for measuring viscosity: the kinematic scale used in most of the following assays, which uses units known as centistokes and is the most universally recognized, and the Redwood (UK), Engler (Europe), and two Saybolt (US) scales. In all cases, higher viscosity readings indicate more resistance to flow. Other important specifications of the raw crude oil include its volatility, measured by a test known as Reid vapor pressure; its acidity and toxicity, which can be measured by hydrogen sulfide content; total acid number; and other tests.

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These characteristics also have a direct effect on the handling and refining characteristics of the crude oil. RVP is usually measured in pounds per square inch at 100 degrees Fahrenheit, with higher values indicating greater volatility or a greater tendency to vaporize. RVP tends to be relatively low in most crude oils except the lightest ones or some condensates. Hydrogen sulfide is typically measured in parts per million, and it can be extremely dangerous at higher levels because it is poisonous to humans and its acidity makes it highly corrosive, requiring special handling procedures and equipment. The most important test of a crude oil beyond the measuring of its gravity and sulfur content is atmospheric distillation, which indicates the yields of various refined products at specific temperature ranges or cut points. Lighter-gravity grades always produce larger shares of light products, but the atmospheric distillation test indicates the specific shares of individual light products that a crude oil yields. It also allows further testing of the characteristics of the individual products that can be generated from a specific crude oil, which is a key part of the assay. The yield of products can be measured in terms of volume or weight, which provide slightly different results. As the heat increases, the lighter products boil off, with liquefied petroleum gases vaporizing at the lowest temperatures, followed by gasoline, naphthas, kerosine, and gas oils, which are the heaviest distillates. The oil that remains after the distillation process, usually at temperatures above 350-380 degrees centigrade, is known as residue. The cut points for these various products can vary depending on the specific test, and there may be more fractions broken off, but they still usually fall into these same general categories.

Gasoline
Each of the individual products broken out through distillation has key specifications that determine its potential value as a finished product or a feedstock. Distillation rarely produces much product that can be considered finished gasoline because further processing through reformers and other units is usually needed. But the lightest naphtha fractions of most grades are often used directly in the gasoline pool. For these gasoline fractions, the most important characteristic is octane, which measures the tendency of the fuel to ignite prematurely in the combustion process, causing the engine of the vehicle that is burning the fuel to knock and operate inefficiently. The higher the octane number, the less the fuel is prone to knocking. Two scales are usually used: research octane and motor octane. The research octane number (RON) of most of the atmospheric gasoline or light naphtha fractions in the crude oil assays are generally somewhat below the usual commercial standard of 80100 octane, and thus require the blending in of octane-boosters to meet these standards. Refining processes, such as naphtha reforming and alkylation, and additives, such as lead and MTBE, are commonly used to raise octane levels.

Naphtha
The key characteristics of naphtha that determine its suitability for either gasoline manufacturing or for use as a petrochemical feedstock are the relative quantities of three basic types of hydrocarbons: paraffins, naphthenes, and aromatics. Aromatics generally have high octane values and are good for making gasoline, and naphthenes can be readily converted to aromatics through reforming. Naphthas that are rich in these two hydrocarbons, with a combined content of 40% or more, are usu-

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ally good for making gasoline and are sometimes referred to as high N+A naphtha. For example, the naphtha cut from a gasoline-rich grade such as Bonny Light has an extremely high N+A of 67% by weight (see pH183). Paraffins can also be converted to higher-octane hydrocarbons through reforming, but less efficiently than naphthenes. Naphthas that are highly paraffinic are often more desirable as feedstocks for petrochemical manufacturing, where they are used for cracking into ethylene, a basic building block for more specialized petrochemicals.

Kerosine
Kerosine is the lightest of the middle distillates, and it plays a dual role as a blendstock for heavier gas oil fractions and as a fuel in its own right. As jet fuel, its key characteristics are its sulfur content, smoke point, and freezing point. Due to the extreme cold of high altitudes, commercial jet fuel requires kerosines that have freezing points of -40 degrees centigrade or lower. The sulfur content is usually 0.3% or less depending on the specific commercial specification. These same characteristics are also valuable when it is used as a blendstock to enhance the cold-weather properties of gas oil. As a fuel for home heating or cooking, which is its most common use in Asia, it does not need to meet such high specifications.

Gas Oil
For gas oil, key characteristics include its cetane index, sulfur content, and viscosity. Cetane, like octane, is a measure of the efficiency of gas oil as a fuel for diesel engines. It measures the ability of the fuel to self-ignite under pressure, with higher values indicating better quality. Most commercial diesel fuels require a cetane index of at least 40-45, with the best-quality fuels at 50 or above. Kerosines used for blending into diesel are usually at 50 or more. Sulfur content is a critical environmental specification for gas oil, and specifications are being tightened by new regulations in many markets. Thus, standards for sulfur content vary regionally. Typical specifications range from 0.3% or more in many developing countries to as low as 0.05% for diesel fuel in the US and the European Union. Japan is moving to a similarly tight specification in 1997, and some other Asian countries are not far behind. As described above in relation to the characteristics of whole crude oil, viscosity measures the ability of the fuel to flow at different temperatures, which is critical both for its handling and as an indication of how suitable it is for upgrading or how easily it can burn. Cloud point is another key characteristic of middle distillates, and it is especially critical for diesel fuel because it indicates the temperature at which paraffins begin to crystalize in the fuel, potentially clogging engine filters. Diesel fuels usual commercial maximum cloud point is about 10 degrees Fahrenheit.

Residue
Viscosity and sulfur content are among the most important specifications for atmospheric residue. To be used as fuel, most residue must be heated and sometimes blended with other oils to improve its handling characteristics. Viscosity standards for high-sulfur residual fuel vary from 380-420 centistokes in Europe and the Mideast to 180 centistokes in Singapore. Some grades, such as Asian low-sulfur waxy residual fuel, have extremely high pour points in excess of 100 degrees Fahrenheit (37.8 degrees centigrade). Sulfur content also varies regionally, with high-sulfur fuels in the US

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starting above 1%, while in Europe, the low-sulfur fuel grade is 1%, and high-sulfur is 3.5%. As indicated in the earlier section on netback calculations, blending is often required to meet the commercial fuel oil specifications for sulfur content. Other characteristics also help a refiner to determine whether the residue is suitable for upgrading, asphalt manufacturing, or other uses. High asphaltene content is an indication that the residue is likely to be a good feedstock for making asphalt because it has good binding characteristics, but an abundance of asphaltene can make for an undesirable fuel. For example, Mexican Maya produces residue with a high asphaltene content of 13.8% (see pH173). Metals content is a key obstacle to upgrading processes, especially to cracking technologies that rely on catalysts. In addition, residues with relatively high levels of the metals vanadium and nickel can pose problems as boiler fuels. The Conradson carbon residue test provides an indication of how much coke a residue produces in the coking process, with lower values generally considered more attractive because they imply a higher yield of light products. The aniline point is another measure of cracking capabilities, with a higher value indicating greater potential for producing light products.

Choosing A Crude Oil


In taking this wide range of quality considerations into account, a refiner must also evaluate transportation alternatives and the price dynamics of the market before deciding the best grades for making the slate of products that are required downstream. With over 100 crude oils in international trade, the choices can be quite daunting, as indicated by the section on crude oil profiles (see Chapter H). In practice, though, refiners can often be quite conservative in their choices of crude oil feedstocks. This caution derives from a combination of factors. Refineries generally use a few particular grades of crude oil, which creates a natural bias in favor of these grades. The complex quality of the grades and the refining process also means that a new grade can produce unexpected results. Logistical considerations can also create serious obstacles. It is often safer, then, to stick with familiar grades rather than experiment. The tables in Chapter G of the reference section outlining crude oil contracts by company and US crude oil imports by company show that refiners vary considerably in terms of the diversity of crude oils that they rely upon. However, refiners with greater upgrading capability can generally handle a wider variety of grades because of their greater flexibility. Simple refineries tend to be biased in favor of light, sweet grades, while more complex plants can handle heavier, sour oils as well as the higherquality grades.

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Glossary Of Terms
API gravity. A measure of the weight of hydrocarbons according to a scale established by the American Petroleum Institute. Crudes with higher values are lighter and tend to produce larger volumes of high-value lighter products in atmospheric distillation, which makes them relatively more valuable. Crudes that are lower on the API scale tend conversely to be less highly valued because they produce smaller yields of lighter products. assay. A laboratory assessment of the characteristics of a crude oil that help determine its market value and refining capabilities. Assays of some kind are usually required as part of all crude oil sales. atmospheric distillation. The primary phase of all refining in which crude oil or other raw feedstock is boiled and the vapors are collected and condensed to create basic petroleum products. backwardation. A relationship between prices in which the cost of prompt, immediately available supplies exceeds the price of volumes available in the future. Oil markets have been in backwardation for much of 1995 and 1996. benchmark crude. A crude that is traded regularly enough in the spot market that its price quotes are relied upon by sellers of other crudes as a reference point for setting term or spot prices. Brent, West Texas Intermediate, and Dubai are all benchmark crudes. Brent market. A widely traded group of spot, forward, and futures markets in North Sea Brent crude that emerged in the early 1980s. They are used as a key source of international oil price risk management and as a benchmark for crude oil pricing under both term and spot transactions. Forward trading extends several months ahead with supplies becoming wet at least 15 days prior to loading. A parallel futures market in Brent also exists on Londons International Petroleum Exchange. bunker fuel. Oil consumed as fuel by ships usually residual fuel oil but sometimes diesel. CFD. See contract for differences. catalytic cracking (cat cracking). A secondary refinery upgrading process that converts heavy processed feedstocks such as vacuum gas oil into lighter products such as gasoline by passing the feedstock over a heated catalyst in order to break down, or crack, the heavy hydrocarbons into lighter ones. cetane number. A measure of the ignition quality of diesel fuel that indicates the tendency of the oil to ignite spontaneously under pressure, which is a desired characteristic for diesel engines but not for gasoline engines. c.i.f. (cost, insurance, and freight). A price that covers delivery to a specified destination and insurance for that transportation. If insurance is not included it is referred to as C&F.

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coker. A deep-conversion refinery unit that cracks feedstock severely at high temperatures. It takes low-quality residue and transforms it into light products and petroleum coke, completely destroying the resid. con-carbon number (conradson carbon or CCR). A measure of the amount of unwanted carbon produced in the refining process, with higher values indicating a less desirable feedstock. condensates. Liquid hydrocarbons that are produced in conjunction with natural gas. They are chemically more complex than liquefied petroleum gases and are sometimes similar to crude oil or naphtha. contango. The reverse of backwardation. A relationship between prices in which prompt, immediately available oil sells at discount to future supplies. Oil markets were in contango during most of the first half of 1990. contract for differences (CFD). A financial arrangement used in swaps and other financial dealings in which the arithmetic difference between two similar but opposite transactions is exchanged rather than the total amounts involved. The term CFD is used especially in oil to refer to these types of price swaps in the short-term Brent crude market, which provide a way to hedge the difference in price between spot supplies known as dated and first-month forward supplies known as 15-day. cracked residue. The residual oil that is left over after the cracking process. Usually only suitable for use as residual fuel oil or as feed for a coker. (See cracker.) cracker. An upgrading unit that converts heavier oils into light products by means of a catalyst (a catalytic or cat cracker) or by means of adding hydrogen in the presence of a catalyst (a hydro-cracker). crack spread. A set of futures market transactions that attempts to simulate the commercial position of a refiner as a buyer of crude and a seller of refined products. The purpose is to duplicate the profit margin that exists in refining. The most popular crack spread on Nymex is known as the 3-2-1, or the purchase of three crude contracts against the sale of two gasoline contracts and one heating oil contract. This relationship may be reversed in winter when heating oil is in greatest demand. crude oil. Petroleum in its raw state as it emerges from the ground with only minor processing to remove associated natural gas and gas liquids. This processing is usually done at or near the production site. Some synthetic oils that are produced from tar sands, extra heavy oils, or types of shale are refined like crude oil. Condensates are also very similar to crude oil, but usually lighter, and they are often refined like them. deadweight tonnage. A rough measure of the carrying capacity of a tanker. demurrage. An extra payment due to a ship owner if a tanker is forced to wait before loading or discharging. derivatives market. A market where the value of the contract being traded is derived from an underlying commodity such as crude oil. These markets typically involve forward purchases or sales and can take the form of futures markets or over-the-counter swaps and options.

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Dubai market. A widely traded international forward market in Mideast Dubai crude that emerged in the mid-1980s and is used as both a risk-management tool and a benchmark for crude oil pricing East of Suez. Forward trading usually extends for two or three months. Formal futures trading contracts have been attempted unsuccessfully by Singapores Simex and Londons IPE (see entries). f.o.b. (free on board). A price that only covers the cost of the material and the loading of it onto a ship or into a pipeline prior to transportation. Transportation and insurance are the responsibility of the buyer. formula price. A price for crude oil, usually in a term contract, that is determined by a specified relationship to a benchmark crude or a group of benchmark crudes or products. The formula also usually specifies the time lag from the point of loading at which the price is determined, the exact average to be used, and other variables. forward market. An informal market that trades in the future delivery of a specific type of oil, with only some transactions resulting in physical delivery. Unlike a futures market, regulation is much less strict, and there is no clearinghouse or margin payments. These conditions tend to restrict trading to large oil companies and financial entities. (See Brent market and Dubai market.) futures market. A formal exchange that trades contracts for the delivery of a specific type of oil in future months. Only a very small volume results in physical delivery, and in some markets, there is only cash settlement. The presence of a clearinghouse and regular daily margin payments on all positions ensures the financial integrity of the operation at all times. The market is open to all participants. gas oil. A heavier middle-distillate product that is produced at higher temperatures than kerosine and lower temperatures than residual fuel. Usually used as diesel fuel or home heating oil. gasoline. A light distillate product that is usually produced through the reforming of naphtha, cracking of heavier products, and blending. It is the goal of most secondary refinery upgrading technologies. Used for internal combustion engines. hedge. A position in a derivatives market that is designed to reduce price risk from a physical transaction. For example, the sale of a derivative in anticipation of future sales of physical supplies of oil or gas provides protection against possible declines in the price of the physical commodity. hydro-cracking. A secondary refinery upgrading process similar to catalytic cracking that converts heavy processed feedstocks such as vacuum gas oil into lighter products such as gas oil, kerosine, and gasoline by passing the feedstock over a heated catalyst in the presence of hydrogen in order to break down, or crack, the heavy hydrocarbons into lighter ones and add carbon molecules to make the output lighter. IPE. International Petroleum Exchange. A London oil futures market trading gas oil and Brent crude as well as options. kerosine. A middle-distillate fraction that is produced at higher temperatures than naphtha and lower temperatures than gas oil. It is usually used as jet turbine fuel and sometimes for domestic cooking, heating, and lighting.

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light naphtha. A category of naphtha that can be rich in paraffins and is used for ethylene cracking to make petrochemicals. However, if it is rich in aromatics and naphthenes it is used for reforming into gasoline or as blendstock for making gasoline. liquefied petroleum gas (LPG). A class of light hydrocarbons that are gaseous at atmospheric pressure but can be liquefied easily under pressure. They are produced as part of the refining process and also in conjunction with the production of crude oil and natural gas. They can be used both as a fuel and as feedstocks for making petrochemicals and other products. The two types are propane and butane. LPG. See liquefied petroleum gas. liquidity. In the oil market context, this refers to the volume of trading activity and diversity of participants in a particular arena. Greater liquidity allows trades to be executed quickly and easily at a uniform price; a lack of liquidity tends to prevent some interested participants from finding a buyer or seller at a given time. High-volume oil futures markets are the most liquid. margin. For a refiner, the operating profit as measured by the difference between refined product prices and crude feedstock costs. marker crude. A widely traded crude that is used as a reference point for setting the prices of other crudes (see benchmark crude). metals content. A measure of the content of nickel, vanadium, iron, or other metals. High metals content can affect the fuel curning or upgrading characteristics of a crude or residue. naphtha. One of the lightest cuts of the atmospheric distillation process that is vaporized at a temperature range of 5-165 degrees centigrade. Naphtha can be used as a feedstock for both gasoline manufacturing and petrochemicals depending on its quality, with light or paraffinic naphtha usually used in petrochemical plants and heavy or N+A naphtha usually used in reformers at refineries to make gasoline. natural gas. Naturally occurring hydrocarbon gas that is predominantly methane and is produced both in conduction with crude oil or separately. The methane, or dry gas, can occur with varying amounts of natural gas liquids, mainly ethane, pentane, and LPG, as well as condensates. These liquids are typically stripped from the methane as part of the production process. While methane is a highly desirable fuel, natural gas liquids can also be used as feedstocks for petrochemicals and other refining processes as well as for fuels. natural gas liquids (NGLs). The slightly heavier hydrocarbons produced with natural gas such as ethane, propane, butane, and pentane, or natural gasoline. These hydrocarbons are usually liquid or can be easily turned into liquids under moderate pressure. They can be used both as fuels and feedstocks. LPG is one of the main categories of NGLs. netback. A calculation of the value obtained from the processing of a crude oil. It is derived from the yield of the refined products, prevailing refined product prices, and crude oil processing and transportation costs. It allows the comparison of the value of a crude to a refiner with the market price for the crude oil.

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NGLs. See natural gas liquids. Nymex. New York Mercantile Exchange. Futures market trading light crude oil (West Texas Intermediate), unleaded gasoline, heating oil, propane, natural gas, and options. octane rating. A quality specification for gasoline that measures its tendency to ignite spontaneously creating engine knock and causing the engine to operate less efficiently. Two basic rating systems exist: the research octane number, or RON, and the motor octane number, or MON. In both cases a higher number means better quality. Lead has traditionally been used as a low-cost additive to raise the octane number of gasoline, but it has been banned in many countries for health reasons, requiring the use of other high-octane additives. option. A derivative instrument that provides the right to buy or sell a commodity at a given price sometime in the future. The buyer then can choose whether or not to exercise the option depending on market conditions and investment strategy. over-the-counter instrument. A derivative or other financial instrument that is customized for the individual buyer as opposed to being traded on a uniform basis in an organized exchange such as a futures market. pour point. The temperature at which a crude oil or refined product such as residual fuel flows. Some crudes and residual fuels must be heated in order to remain liquid, which is expressed as a high pour point, meaning that they can be difficult to handle and may require heated storage or tankers. paper barrels. A generic term for oil that is bought and sold in forward or futures markets; thus, it involves commitments to make future deliveries rather than exchange of actual physical supplies (see wet barrels). reformer, reforming. In refining this usually refers to the process of catalytic reforming in a reformer unit, which uses heat and pressure in the presence of catalysts to convert naphtha feedstock into higher octane gasoline blending components or reformate. This is done mainly by converting lower-octane naphthenes into higher-octane aromatics. Reid vapor pressure (RVP). A measure of the volatility of petroleum products that is done by testing vapor pressure at 100 degrees Fahrenheit in pounds/square inch. Simex. Singapore International Monetary Exchange. A futures market that trades oil contracts in high-sulfur residual fuel as well as the IPE Brent contract. sour crude. Usually a crude oil that has a sulfur content that is greater than 0.5%. This higher sulfur content affects the quality of the resulting refined products and sometimes means extra processing is required. It is referred to as sour because of the unpleasant smell of the sulfur. spot market. A market for immediately available single cargoes or other small lots of physical crude oil or refined petroleum products. spread. A relationship between two prices, either for the same grade of oil at different time periods or for different grades of oil. These price relationships lie at the heart of

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much current oil trading since they tend to be less volatile than absolute movements in prices. Spreads also define the relative trends of prices between different markets and over time. (See backwardation and contango.) straight-run. A term used to describe any refined product that emerges from the initial refinery distillation of crude oil. straight-run gas oil. A middle distillate that is produced from refinery distillation at temperatures usually ranging from 200-350 degrees centigrade. It usually is used for heating oil or diesel fuel. straight-run residual oil or residue. The remaining portion of the crude oil feedstock that does not vaporize in the refinery distillation process. This product can be used directly as a boiler fuel, or it can be used as feedstock for vacuum distillation units. sulfur content. A measure of the presence of sulfur in crude oil, which is a key determinant of quality. Sulfur content is measured as the percent of sulfur by weight in the crude. Crudes that are high in sulfur are referred to as sour crudes, and those that are low in sulfur are referred to as sweet crudes. swap. A financial risk-management tool in which two parties exchange differing market risk exposures in order to be assured of a fixed or predictable price, usually for an extended period of years. It may also involve short-term instruments in which risk is managed by the swaps provider rather than absorbed by a counterpart. sweet crude. Usually a crude oil that has a sulfur content that is 0.5% or less by weight. Lower sulfur content improves the quality of the resulting refined products, and sweet crudes does not require as much processing as sour crudes. They are referred to as sweet because of the absence of an unpleasant sulfur smell. term contract. A sales contract that specifies set price terms for the purchase of several cargoes of oil over a particular period in contrast to a spot transaction, which involves only a single cargo. Pricing, volume, and timing can all be quite flexible, with the essence being a continuing, regularized commercial relationship. transparency. In relation to a market, this refers to the tendency for price signals and other market information to be easily visible to all participants and for market pressures to be quickly reflected in price levels. ullage. The unoccupied space in a storage tank that is still available for use. vacuum distillation. A secondary refining process in which straight-run residue is distilled in a vacuum in order to separate more light hydrocarbons than through atmospheric distillation. The output of the process is vacuum gas oil, which can be used as feedstock for cracking units, and vacuum bottoms or residue, which are usually used as boiler fuel. vacuum gas oil (VGO). The lighter product manufactured from the secondary refining process known as vacuum distillation. Vacuum gas oil is a preferred feedstock for use in cracking units to produce gasoline and gas oil. viscosity. A measure of the ability of a liquid such as crude oil to flow. Viscosity is measured at a wide range of temperatures according to several different scales. The main

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scales are Kinematic, Redwood, Engler, and Saybolt. This is a critical characteristic of crude oil and residual fuel because it affects its handling. VLCC (very large crude carrier). A class of tanker with deadweight tonnage, or carrying capacity, of 200,000 tons or more. This is the usual size of tanker used to carry Mideast and other grades on long-haul voyages. Some ports and key canals such as Panama and Suez cannot handle these ships when fully laden. West Texas Intermediate market. The US spot crude oil market for West Texas Intermediate crude, which provides the foundation for the actively traded New York Mercantile Exchange light sweet crude futures contract. The main delivery points for spot trading are Cushing, Oklahoma, the base for the Nymex crude contract, and Midland, Texas. wet barrels. A term that distinguishes the trading of physical oil supplies from the forward or futures transactions. Spot markets typically involve wet barrel transactions that result in the delivery of oil.

Reference Section: Profiles, Trade, And Prices

Table of Contents

F.

Country Profiles How Countries Market Their Crude Oil . . . . . . . . . . . .F1 Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F1 Country Profiles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F2

G. Term Contracts And Trade Flows By Country And Company . . . . . . . . .G1 PIWs Term Deals By Producing Nation . . . . . . . . . . . . . . . . . . . . . . . . .G3 PIWs Term Deals By Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .G15 US Crude Oil Imports By Company And Country Of Origin, 1991-95 . . .G33 US Crude Oil Imports By Country Of Origin And Company, 1991-95 . . .G40 H. Crude Oil Profiles A View Of the Market Through Each Grade . . . . . .H1 The Crude Oils And Their Key Characteristics . . . . . . . . . . . . . . . . . . . .H3 Crude Oil Streams Ranked And Indexed By Gravity . . . . . . . . . . . . . . . .H7 Crude Oil Streams Ranked And Indexed By Sulfur Content . . . . . . . . . . .H8 Crude Oil Streams Ranked And Indexed By Volume . . . . . . . . . . . . . . . .H9 Crude Oil Streams Indexed By Name . . . . . . . . . . . . . . . . . . . . . . . . . .H11 Crude Oil Profiles (Alphabetical By Country) . . . . . . . . . . . . . . . . . . . . .H13 I. Prices Spot And Term Contract Prices For Key Grades . . . . . . . . . . . .I1 Key Crude Oil Benchmarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .I3 Spot Assessments For Various Crude Oil Grades . . . . . . . . . . . . . . . . . . .I5 PIW Scorecard Costs To Refiners Of Key Formula Priced Crude Oils In Primary World Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .I11 PIW Scorecard Term Contract Prices At Port Of Loading . . . . . . . . . .I17

Country Profiles

Table of Contents

How Countries Market Their Crude Oil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F1 Country Profiles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F2 Abu Dhabi . . . . . . . . . . . . . . . . . . .F2 Algeria . . . . . . . . . . . . . . . . . . . . . .F3 Angola . . . . . . . . . . . . . . . . . . . . . .F4 Argentina . . . . . . . . . . . . . . . . . . . .F5 Australia . . . . . . . . . . . . . . . . . . . .F5 Brunei . . . . . . . . . . . . . . . . . . . . . .F6 Cameroon . . . . . . . . . . . . . . . . . . .F7 Canada . . . . . . . . . . . . . . . . . . . . .F7 China . . . . . . . . . . . . . . . . . . . . . . .F9 Colombia . . . . . . . . . . . . . . . . . . .F10 Congo . . . . . . . . . . . . . . . . . . . . .F11 Dubai . . . . . . . . . . . . . . . . . . . . . .F12 Ecuador . . . . . . . . . . . . . . . . . . . .F13 Egypt . . . . . . . . . . . . . . . . . . . . . .F14 Gabon . . . . . . . . . . . . . . . . . . . . .F15 Indonesia . . . . . . . . . . . . . . . . . . .F15 Iran . . . . . . . . . . . . . . . . . . . . . . .F17 Iraq . . . . . . . . . . . . . . . . . . . . . . .F18 Kuwait . . . . . . . . . . . . . . . . . . . . .F19 Libya . . . . . . . . . . . . . . . . . . . . . .F20 Malaysia . . . . . . . . . . . . . . . . . . .F21 Mexico . . . . . . . . . . . . . . . . . . . . .F22 Neutral Zone . . . . . . . . . . . . . . . .F23 Nigeria . . . . . . . . . . . . . . . . . . . . .F24 Norway . . . . . . . . . . . . . . . . . . . .F25 Oman . . . . . . . . . . . . . . . . . . . . . .F26 Papua New Guinea . . . . . . . . . . .F27 Qatar . . . . . . . . . . . . . . . . . . . . . .F28 Russia . . . . . . . . . . . . . . . . . . . . .F28 Saudi Arabia . . . . . . . . . . . . . . . .F30 Syria . . . . . . . . . . . . . . . . . . . . . .F32 United Kingdom . . . . . . . . . . . . . .F33 United States . . . . . . . . . . . . . . . .F34 Venezuela . . . . . . . . . . . . . . . . . .F35 Vietnam . . . . . . . . . . . . . . . . . . . .F37 Yemen . . . . . . . . . . . . . . . . . . . . .F37

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COUNTRY PROFILES

How Countries Market Their Crude Oil


The worlds crude oil exporting countries are a broad and diverse group, each with its own unique market circumstances and objectives. Of the almost a dozen countries in the group that exported 1-million barrels a day or more of crude oil in 1996, only seven are Opec members, and a few are advanced industrial nations. This chapter delves into the complex factors that lie behind these widely differing individual circumstances and the impact that they have had on government sales strategies. The chapter is broken down into profiles of the 36 most important crude oil exporting countries in the world, organized alphabetically for quick reference. Specific details are provided that go beyond the earlier discussions of international spot and term-contract markets, but the descriptions have been kept brief, in part because of the wealth of further information that is available on individual crude oils (see Chapter H).

TOP 10 CRUDE OIL EXPORTING COUNTRIES IN 1996


Saudi Arabia Norway Iran Russia Venezuela UAE Nigeria UK Mexico Canada
0

(In 1,000 b/d)

Output Exports

1,500

3,000

4,500

6,000

7,500

9,000

Russian exports to other former Soviet Republics and elsewhere.

Export data for 1995 indicate some important shifts in the relative volume positions of the worlds crude oil exporters. Both Norway and Venezuela advanced in the rankings, and Russia recaptured some lost ground in its exports to countries outside of the ex-USSR. The UK and Canada also rose strongly. But the United Arab Emirates fell behind due to sagging Dubai field flows, and Libya slipped in the rankings despite relatively stable exports. Saudi Arabia continues to stand head and shoulders above the rest of the field.

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The table below shows the crude oil exports and production in 1996 and 1995 for the 30 largest exporting nations. It provides a useful backdrop for the discussions of the individual countries that follow.
TOP 30 CRUDE OIL EXPORTERS, 1995-96 (In 1,000 b/d) Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Country Saudi Arabia Norway Iran Russia Venezuela UAE Nigeria UK Mexico Canada Libya Kuwait Indonesia Oman Algeria Exports* 1996 1995 6,520 6,550 2,825 2,525 2,700 2,670 2,425 2,420 2,000 1,818 1,950 1,965 1,800 1,750 1,600 1,618 1,540 1,350 1,200 1,163 1,125 1,115 975 1000 870 805 815 785 660 625 Output 1996 1995 7,975 8,018 3,082 2,781 3,666 3,608 5,985 5,981 2,980 2,710 2,201 2,193 2,030 1,876 2,445 2,417 2,857 2,617 2,035 1,992 1,400 1,390 1,820 1,850 1,363 1,358 882 855 809 766 Rank 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Exports* Country 1996 1995 Angola 650 610 Neutral Zone 480 425 Qatar 450 400 Egypt 435 450 China 375 300 Syria 360 370 Colombia 355 320 Gabon 340 315 Argentina 300 200 Yemen 295 275 Malaysia 250 250 Ecuador 250 250 Australia 200 180 Brunei 170 170 Congo 165 170

Output 1996 1995 679 640 480 425 473 449 893 923 3,174 2,996 585 598 623 586 365 341 770 712 350 335 655 660 395 395 551 545 175 175 180 185 Russian exports to

Note: Data for 1996 based on first 10 months. *Includes condensates for Algeria and Indonesia. other former Soviet republics and elsewhere.

ABU DHABI
The emirate of Abu Dhabi is the largest oil producer in the United Arab Emirates confederation, and it has one of the widest ranges of crude oil grades among Mideast exporters. Characteristics common to all of the crudes are their medium-tolight weight for regional oils and their relatively low sulfur content, at least by Mideast standards. The highestquality grades, onshore Murban and offshore Lower Zakum and Umm Shaif, are especially prized among Asian buyers because of their high yields of top-quality middle distillates (see pH13-H26). Far East markets have become so reliant on Abu Dhabi crude oil that less then 30,000 b/d heads elsewhere for a sustained period. Back in 1994, over 100,000 b/d consistently flowed to Mediterranean refiners. The high kerosine yields of Abu Dhabi grades are especially valuable in autumn and early winter for Japanese and South Korean refiners, when they are building up stocks for the winter heating season. Marketing is handled by state Abu Dhabi National Oil Co., which controls 60% of Abu Dhabis crude oil production, and by a mix of foreign equity producers, which hold the remaining 40%. Adnoc moves most barrels on either a government-to-government or term-contract basis, while the equity companies tend to sell more spot barrels. Major oil companies, Japanese consortium Jodco, and South Korean refiners dominate the purchase of Upper and Lower Zakum, Murban, and Umm Shaif exports, while Frances Total shares marketing of Abu Bukhoosh with Japan Indonesia Petroleum. Besides a long list of Japanese and Korean buyers, other purchasers include Bangladesh, India, Thailand, Sri Lanka, Pakistan, and Taiwan. Jodco,

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Kanematsu, Mobil, Exxon, Royal Dutch/Shell, and British Petroleum also market Abu Dhabi grades to Japanese buyers. Pricing for Adnocs term contracts is on a monthly retroactive basis, and individual crude oil streams are loosely aligned with spot Dubai quotes from the previous month, with a premium over the Mideast benchmark grade that reflects the higher quality of the Abu Dhabi oils. The term-contract sales of equity producers are usually tied directly to the Adnoc prices, as are most spot sales. Destinations of exports vary according to competing grades and time of year, but Japan has come to dominate purchases. Refiners from South Korea, Taiwan, and Singapore are also active buyers. Japans thirst for Abu Dhabi grades has picked up with higher runs at its relatively unsophisticated refineries in recent years and the countrys growing demand for light products.

ALGERIA
Unlike most other Opec oil producers, Algerias crude oil marketing is not the primary source of its petroleum export revenue, but it is likely to regain some of its past importance with growing domestic production. Algeria also exports large volumes of oil products, condensates, liquefied petroleum gas, and natural gas. In fact, the countrys foreign sales of condensates and refined products, both at about 300,000-400,000 barrels a day each, exceed its international crude oil sales, which typically run at 300,000-350,000 b/d and are mainly of light, sweet Saharan Blend (see pH27-H32). The high quality of the crude oil and its large gasoline yield make it popular among refiners, especially during the summer. The main markets lie across the Mediterranean in Italy, France, and southern Germany, where it competes with Libyan, Syrian, Tunisian, and Nigerian grades. Small volumes have also found their way to South Korea and China in recent years. In contrast, Algerian condensate is popular in both the Americas and Europe for gasoline and petrochemical manufacturing, with US imports for petrochemical purposes running at over 200,000 b/d. Despite concerns over potential political upheaval, Algeria has managed to bring several international oil companies back in, which have been highly successful in finding new reserves. This opening has lead to a quiet revolution in the way Algerian crude oil will be marketed in the future. While most current crude oil exports are still handled by state Sonatrach, Italys Agip began exporting 50,000 b/d of Saharan Blend on its own account in October 1995 and became the first foreign producer to do so in over two decades. Next on line, Petro-Canada and Spanish Cepsa were scheduled to begin selling equity crude oil in mid-1996, while US independent Anadarko expected to bring 40,000 b/d on stream by December 1996. Exports tied to Anadarkos 1.5-billion barrel east Algerian fields could climb as high as 300,000 b/d by 1998, which would push crude oil exports back up over 500,000 b/d. The addition of all this extra Saharan Blend is likely to create an active spot market in

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the Mediterranean, and it could possibly emerge as a regional sweet crude oil benchmark independent of Brent or Forties. Algerian crude oil is sold on the basis of formulas that vary slightly among customers but are all tied to North Sea Brent grade. Saharan Blend prices are usually at a premium of 50 a barrel or so above Brent. Algerian condensate sales are usually priced on the basis of refined product levels in the US Gulf Coast and Rotterdam. For both crude oil and condensate, the pricing is usually determined on a cargo-by-cargo basis even for regular term-contract customers.

ANGOLA
Angolas roughly 650,000 barrels a day in crude oil exports are primarily shipped to refineries in the Atlantic Basin, although the pull of Asia-Pacific markets has grown stronger in the early 1990s. Angolan grades enjoy wide popularity because their quality places them between conventional sweet and sour categories. Grades such as Cabinda, which encompasses over 50% of Angolas exports, are used for blending with higher- and lower-quality grades, making these grades popular for both simple and complex refining systems despite high wax content. Since 1992, Angola has found an increasingly wide market in the Far East, as Cabinda has become popular there because of its high middle-distillate yield. The low sulfur content of Angolan grades has also made them attractive for direct burning as boiler fuel by Japanese utilities. Angolas two other main export grades are Palanca and Soyo. Molongo and Takula, sometimes referred to as separate streams, are simply terminals in the Cabinda system (see pH33-H38). Exports, which have risen by about 200,000 b/d since 1993 and are set to climb further, are handled by both state Sonangol and equity producers mainly Chevron, Elf Aquitaine, Agip, and Texaco. The crude oils are priced exclusively off dated Brent, with differentials fluctuating at a discount of between $1 and $1.75 a barrel under the North Sea marker grade. Aside from barrels that stay within the downstream systems of equity producers, much of the rest of the oil finds its way into the spot market, through the equity producers, Sonangol, or term customers. In fact, Angolan crude oils are some of the worlds most actively traded spot barrels other than the international benchmarks and Nigerian grades. Reflecting the popularity of Angolan crude oil and its wide spot trade, almost 15 US companies imported it in 1995 a list that rivals in length the lists of much larger suppliers such as Canada, Saudi Arabia, and Venezuela. Some of the larger US buyers in 1995, when imports totalled 365,000 b/d, include Sun, Coastal, and Phibro. Sonangol is the single largest marketer of Angolas crude oil, maintaining an average term customer base of eight to 12 buyers. However, with much of the increased production being handled by equity producers, regional diversification in the marketing of Angolan grades is only likely to intensify. After a one-year

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shutdown due to civil war, onshore operator Petrofina has begun marketing up to 30,000 b/d of Soyo crude oil in 1996. Brazils Petrobras also buys 20,000 b/d under a barter arrangement to pay down debt. Production has managed to increase despite intermittent flashes of civil unrest tied to the last vestiges of the 21-year-old civil war.

ARGENTINA
Argentina has begun to emerge as a small but increasingly visible exporter to the Latin American and US markets. Argentine crude oil exports to the US topped 45,000 barrels a day in 1995, although they should begin to drop back as producers there focus on nearby developing markets in the southern cone of South America. Overall crude oil exports were up over 250,000 b/d in 1995 and were expected to exceed 300,000 b/d in 1996, as greater use of natural gas within Argentina has made domestic oil demand grow at a slower pace than new production. Far and away its biggest customer, Brazil is purchasing 120,000 b/d, almost 40% of Argentinas exports, under a series of term-contract and spot purchases. Chile buys 100,000 b/d mostly through the newly opened 100,000 b/d Transandean pipeline from the prolific Neuquen Basin to the Chilean port of Concepcion. US imports climbed slightly in 1995 to 47,000 b/d and could hit 60,000 b/d in 1996, with Exxon alone purchasing half the total. As the countrys production rises, further exports to Chile and beyond are expected. Far East, US West Coast, and European destinations have already been broached and could be a precursor to further diversification. Cargoes of Argentine crude oil have found their way to Spain, Italy, Japan, South Africa, Taiwan, and Canada. The only possibility of a cut in exports could come from higher domestic refining runs, as existing capacity exceeds throughputs by almost 200,000 b/d. Grades are purchased based on a formula tied to either US West Texas Intermediate at Cushing, Oklahoma, or to dated Brent. Some Brazilian sales contracts are on a dated Brent formula. The growing domestic role of private oil companies is evident in the output and export numbers, with over 10 firms producing a total of over 725,000 b/d. Argentinas privatization of state YPF has created a mini drilling boom and ushered in a host of new potential exporters. Argentina refines less than two-thirds of its crude oil, and that percentage is dropping. Newly privatized YPF and Argentine conglomerate Perez Companc produce over 50% of the countrys crude oil and are the largest exporters of Argentinas four main export grades, Canadon Seco, Escalante, Medanito, and Rincon. All of these grades are low in sulfur, with Canadon Seco and Escalante roughly 25-gravity and Medanito and Rincon around 36-gravity (see pH39-H46).

AUSTRALIA
Australia produces roughly 560,000 barrels a day of crude oil and 60,000 b/d of condensate, but only about 30% of this oil is exported. All sales are by equity producers, with Exxon and domestic BHP the dominant sellers. Despite gradual production declines since the late 1980s, the offshore Gippsland field and adjacent Bass Straits fields remain the largest sources of domestic crude oil and account

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for about 40% of total output. The high-quality Gippsland grade is sought by refiners in Japan, the US, and Singapore, as well as in Australia itself (see pH47H54). Due to its high light-product yield, it is among the most expensive grades on the world market, and it is generally more costly than competing grades from Malaysia and Indonesia. The two equity holders, Exxon and BHP, sell occasional cargoes of about 650,000 barrels each on the international market, mostly on a spot basis. The two companies are spending heavily to increase reserves through enhanced recovery and bringing on smaller satellite fields, which are expected to keep output near 200,000 b/d into the next century. Most of the countrys oil exports come from expanding output from the Northwest Shelf and Timor Sea areas, which has helped to offset the decline of the Bass Straits fields. The Timor Sea fields the older Challis, Jabiru, and Cassini, along with Skua produce about 65,000 b/d, mostly for export, with BHP a dominant equity producer. New fields coming are scheduled to raise Australian production to a peak of 615,000 b/d in 1996, when exports should top the 200,000 b/d mark. The planned development of the offshore Wanaea/Cossack field on the Northwest Shelf paid dividends in late 1995, with new production adding 130,000 b/d of extra-light, low-sulfur crude oil to Australias export menu. Flows from Griffin, also on the Northwest Shelf, started in 1994, with an expected peak rate of almost 80,000 b/d, also providing a boost to exports. Beyond 1996, production is likely to drop steadily over the next decade, except for one more brief uptick in 1999, when the Laminaria field could add around 75,000 b/d of new output. Condensate output has not risen as quickly as expected, although the Northwest Shelf liquefied natural gas project has provided a stable baseload. The Goodwyn gas/condensate field on the Northwest Shelf started up by 1995 with flows of 60,000 b/d, doubling Northwest Shelf condensate output. Much of this condensate is being exported to markets in the Far East. Australia is also a significant petroleum importer, averaging about 360,000 b/d of crude oil, mainly from the Mideast and Indonesia. This complements domestic supplies of light, sweet crude oil and condensate, which are the baseload supply to Australias sophisticated, gasoline-oriented refining system.

BRUNEI
Bruneis crude oil-marketing policy is clear and uncomplicated. Joint-venture company Brunei Shell, owned 50/50 by the Shell group and the government, handles all oil exports. The tiny Southeast Asian sultanate has loosened its previously strict production ceiling of 150,000 barrels a day for both crude oil and condensates after temporarily increasing flows during the Gulf war and adding to its reserve base. Output was about 175,000 b/d in 1995, with Japanese and South Korean firms the main buyers. Output peaked at over 180,000 b/d during the Gulf crisis in 1990-91. Japanese and Korean term-contract customers look to the crude oils as secure baseload supplies outside of the Mideast. Both countries also have increasing needs for low-sulfur grades, and since slightly more than half of Bruneis production is either light,

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low-sulfur crude oil or condensate, customers are usually willing to pay a premium over other Asian supplies (see pH55-H62). Brunei sells three grades of crude oil and one of condensate, with prices set monthly on a retroactive basis, generally in line with top-quality Malaysian pricing levels. Term sales are emphasized over spot deals, although an increasing level of pricing and marketing flexibility has been apparent since the mid-1980s. Brunei Light and Seria Light Export Blend are the lighter grades, while Champion is the heavy export crude oil. SLEB is actually just a blend of Brunei Light and Champion, and a large volume of it goes to Japan for use as boiler fuel at power plants. Nearly 20,000 b/d of Brunei condensate, mainly from the sultanates liquefied natural gas plant, is sold separately. Exports account for all but about 5,000 b/d of total crude oil and condensate production, with more than 80% sold on a term-contract basis. Japan, South Korea, Singapore, and Thailand account for over 90% of all term contract purchases. Spot cargoes also sell into other neighboring countries such as the Philippines and Taiwan.

CAMEROON
Like most of the smaller West African producers, Cameroon relies heavily on equity partners to market its crude oil output, which was about 130,000 barrels a day in 1995. All of the crude oil is produced by Elf and Shell, with Kole Blend accounting for the bulk of exports from its output of 110,000 b/d. At 32.5-gravity, Kole is relatively heavy but low in sulfur, and as a result, sales have broadened away from past reliance on US Gulf Coast refiners and toward Far East outlets. For those refiners that can handle it, Kole is prized for its wide middle-distillate cut. The other main grade is heavier 20-gravity Lokele, which is also low in sulfur and sometimes used for direct burning in power plants (see pH63-H66). Prices for Cameroons exports are typically linked to dated Brent, with Kole having increased in value in the past few years due to a worldwide shortage of heavier low-sulfur grades. Through the first quarter of 1996, spot prices were running at dated Brent minus 75 a barrel. Prices for Lokele are also higher than earlier this decade, running fairly often at around dated Brent minus $1.45. Pricing is determined on a cargoby-cargo basis, and a significant share of exports end up in spot trade. State SNH sells most of its share under term contracts, but these barrels are often resold into the spot market.

CANADA
The Canadian crude oil-supply system is primarily pipeline-oriented, so its oil exports are directed almost exclusively at the big US market to the south. The

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existing pipeline network has allowed crude oil producers in Western Canada to export significant volumes to US refiners in the northern states, stretching from the Great Lakes region to the Pacific. Canada supplied about 1-million barrels a day of crude oil to the US market in 1995, but serious pipeline capacity constraints on most lines are causing diplacements of sales, and several expansion plans are under consideration. With Canadian supplies available for export expected to rise in the years ahead and US requirements growing, there is little doubt about the need to expand capacity. The key question is: Which regional markets in the US should the Canadian producers focus on? The choices are complex, involving uncertainty over US and Canadian regional output, imports, and demand. The 1.47-million b/d Interprovincial Pipe Line, the primary route for exports to the US, has had to frequently deny access to 20%-40% of requested volumes due to a lack of space. IPL is currently raising capacity by another 120,000 b/d after quickly using up all of a 170,000 b/d expansion completed in 1995. This latest addition should be completed by late 1996. The only remaining escape valve for surplus Canadian crude oil is the 290,000 b/d TransMountain Pipeline, which services US Pacific Coast refiners in the Puget Sound area near Seattle, Washington. These US refiners had been taking as much as 110,000 b/d of Canadian crude oil in 1995, up sharply from the 80,000 b/d purchased back in 1993. The US West Coast is clearly a last gasp option for most sellers, as relatively lower crude oil prices there make it an unattractive market for Canadian producers. However, the lifting of the ban on US Alaskan North Slope exports in 1996 should help to raise prices for Canadian producers, as ANS will no longer be a captive, cheap purchase for US West Coast refiners. When Canadian prices have been extremely low, crude oil has sometimes been exported from Vancouver to the Far East. Crude oil-short Eastern Canada relies on a combination of pipeline supplies from the west and imports of about 500,000 b/d from the international market. But its import dependence should ease by 1998, when crude oil starts flowing from Newfoundlands Hibernia field. Hibernia is expected to plateau at 125,000 b/d in 2000, followed soon after by 100,000 b/d of output from nearby Terra Nova. It is not yet clear if any of this new production will be exported (see pH67-H72). The refiners in the US Great Lakes region are key importers of Canadas heavy grades, which Canadian refiners have significant difficulty absorbing themselves. About 500,000 b/d of heavy Canadian crude oil is imported by the US, and Great Lakes refiners Koch, Amoco, and Mobil are among the largest users. The US absorbs roughly two-thirds of Canadas heavy crude oil output. The countrys higher-quality, light, sweet grades amount to a little over 400,000 b/d, while light, sour, and synthetic grades provide about 100,000 b/d each of imports. While heavy crude oil production holds the greatest potential for growth, US imports of lighter Canadian grades should also grow when part of a key pipeline to Eastern Canada is reversed as expected in the last half of the 1990s, allowing refiners in Ontario to increase their reliance on cheaper international or future Eastern Canadian supplies at the expense of light, sweet domestic crude oil.

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Canada was producing over 2.1-million b/d of crude oil in 1996, and output is likely to stay at that level or even rise slightly as more pipeline outlets are built to the US. While exports to the US amounted to 900,000 b/d, Canada also imports about 600,000 b/d from overseas, with about half of that total coming from the North Sea. This includes volumes imported for third-party processing in Newfoundland, and also a trickle of 3,000 b/d or so of imports from the US. The Canadian crude oil market is similar to the US domestic market, with a myriad of sellers. Refiners post prices for the various grades, which are sold on a ratable basis in the pipeline systems. Export prices are often quoted on a Chicago delivered basis in US dollars. Most crude oil moves under term contracts, but spot trade has grown despite the limitations of pipeline capacity. Prices are tied to US West Texas Intermediate and West Texas Sour grades.

CHINA
Chinese oil-marketing policy reflects a complex web of pressures, which include such factors as Beijings need to earn hard currency, attempts by state companies to integrate vertically, and the central governments fight with provincial and municipal authorities to control the nations oil supply, including exports and imports. Beijings campaign to maximize oil exports while limiting imports has had mixed success: It has kept crude oil exports at about 400,000 barrels a day, but the country is still slipping into net importer status due to surging domestic demand and static production of just over 3-million b/d. State Sinochem, which previously had its trading monopoly broken, has partially reasserted its role in overseeing exports in the last couple of years. Attempts to centralize and curb products and crude oil imports have had only sporadic success, as other state companies have moved into new activities in the petroleum sector. In general, crude oil is exported from onshore and offshore fields in northern China, while crude oil imports are mainly to refiners in the south and near the coast. Two grades dominate export sales: medium-gravity Daqing and heavy Shengli, which together account for nearly twothirds of total Chinese output of just over 3million b/d. Both are relatively high in wax content, but the heavier weight and higher sulfur content of Shengli as compared to other Asian grades makes it unattractive and hard to sell. Like similar Asian grades from Indonesia and Vietnam, these grades are used both as refinery feedstock and as boiler fuel at power plants. Daqing accounts for most exports, which are influenced by Japanese needs for crude oil for direct burning at power plants during peak electricity-use seasons, as well as by the availability of similar grades such as Indonesian Minas and Vietnamese Bach Ho. Japan imports about 200,000 b/d of Daqing for refinery use and as much as another 100,000 b/d for power plant fuel. Lower-quality Shengli is generally used more in domestic refining, and Japan takes about 25,000 b/d (see pH73-H76). Growing sales from offshore fields are handled by foreign partners for state

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CNOOC and move to Singapore, the US West Coast, or Japan. Shell and Phillips are two of the newest marketers of Chinese crude oil, selling roughly 100,000 b/d of low-sulfur, waxy Xiiang along with partner CNOOC since November 1995. Sales have been made to Indonesia, Hawaii, and Singapore so far. In general, Japan is Chinas primary customer, taking some 300,000 b/d in 1995. US refiners still take around 50,000 b/d, with the US West Coast operations of Chevron and Tosco the dominant buyers. Smaller volumes of up to 40,000 b/d are bought by South Korean refiners. Pricing systems vary for Chinese exports, but contracts are all tied in some way to the official price of Indonesian Minas grade or spot Oman and Dubai. Japans 180,000 b/d government-to-government deal with China is priced on a retroactive monthly basis, tied loosely to the average Minas quote. Buyers try to take advantage of the price lags of Minas which is set on a complicated five-grade rolling average linked to the Asian Petroleum Price Index by increasing purchases when prices are low. But Sinochem attempts to push more volume across to Tokyo and buy cheaper replacement barrels for refineries in southern China when prices are high. Spot sales are increasingly rare, but they also use Minas as a benchmark.

COLOMBIA
Of the worlds major crude oil exporters, Colombias position is changing more dynamically than most of its rivals. While still the third-largest crude oil exporter in South America and far behind front-runners Venezuela and Mexico, several new grades including Cusiana and Cupiagua should make Colombia a major force in crude oil markets in the coming years. Although export volumes of its Cano Limon grade are relatively small at 240,000 barrels a day, the grade can be an influential trendsetter in US markets because it is a popular spot barrel for sweet and sour crude oil refiners alike and is heavily traded on the US Gulf Coast. Similar in quality to US Alaskan North Slope grade, it is a medium-to-heavy 30-gravity oil with a relatively low 0.5% sulfur content. Plans for developing the Cusiana field and its satellites call for marketing the new 36-gravity, 0.25% sulfur crude oil as a separate stream. Through early 1996, Cusiana production was up to nearly 200,000 b/d, with exports over 100,000 b/d. Total Colombian crude oil exports are expected to rise from close to 400,000 b/d at present to over 600,000 b/d by 1998 (see pH77-H82). While volatile because of sporadic guerrilla attacks on the main export pipeline, Colombias crude oil production runs in the neighborhood of 630,000 b/d, with output expected to rise to more than 900,000 b/d by 1998. Several new pipeline projects are under way to increase export capacity. Plans include a new and improved $2.5-billion crude oil export pipeline system. In addition to other expansions, the so-called Ocensa pipeline consortium which groups Cusiana partners BP, Total, Triton Energy, and Ecopetrol with Canadian pipeline firms IPL and TransCanada is counting on running the pipeline at 85% of its 500,000 b/d capacity on average. Crude oil shipments to the Covenas export terminal are often disrupted by attacks on the existing 225,000 b/d Cano Limon and 75,000 b/d Llanos Central pipelines. Monthly production has dropped as low as 300,000 b/d at times, and cargoes have often been rolled over into future months, which is why many US refiners shy away from committing to term contracts.

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Colombias four main crude oil producers are state Ecopetrol, British Petroleum, Shell, and Occidental. Cano Limon exports are divided among three producing companies, with Ecopetrol selling 50% and Shell and Occidental dividing the rest. Cusiana exports are divided among equity producers Ecopetrol (50%), BP (19%), Total (19%), and Triton Energy (12%). Ecopetrol offers its share on a term-contract basis in most cases. The Cano Limon contracts last from three to six months and are awarded on an open-tender basis with linkage to West Texas Intermediate. Cusiana term contracts have been signed with Tosco and Fina for 1996, with several more deals expected as output continues to rise toward 500,000 b/d by the end of 1997. From the Covenas loading terminal in the Caribbean, term buyers lift one or two 75,000-deadweight-ton cargoes per month, which is the preferred size for delivery to the US Gulf Coast. Shell also exports 45,000 b/d of heavier Vasconia grade, which is a 25-gravity, 0.8% sulfur grade. Cano Limons ambiguous status in the middle ground between sweet and sour grades makes its pricing a confusing affair. Term and spot buyers take cargoes on a formula basis tied to any one or a combination of US marker grades Alaskan North Slope, West Texas Intermediate, and West Texas Sour. Cusiana, a low-sulfur, sweet grade, is priced versus WTI and has traded anywhere between 20 and 75 a barrel under the US benchmark. Equity producers BP, Total, and Triton Energy were selling their cumulative 45,000 b/d on a spot basis in 1996. Shell and Occidental sell most of each of their three monthly cargoes of Cano Limon on a spot basis on the US Gulf Coast. Meanwhile, Ecopetrol normally juggles four to six term customers at any one time.

CONGO
Congos current exports of about 180,000 barrels a day are handled mainly by Elf Aquitaine and Agip, which are the equity producers of Djeno crude oil, the countrys primary export grade. Elf holds 60% and Agip 40% of the 175,000 b/d Djeno crude oil stream, which is relatively heavy, at 27-gravity, but low in sulfur like other West African oils. As for other, smaller West African producers, the US Gulf Coast has traditionally been a primary outlet for Congos Djeno grade, but the interest of Asian customers in heavy, sweet grades has pulled volumes in that direction in recent years. The pricing of Djeno is tied to dated Brent, and the grade appears regularly in spot trade. Djeno is usually priced at a discount of about $2-$3 a barrel off dated Brent, but the gap has sometimes been as wide as $5-$6. Recent US buyers include Exxon, Amerada Hess, and Phibro, with Italys Agip and Spains Repsol also occasional buyers. Yombo, Congos other main crude oil stream, is a sweet but heavy 20-gravity grade produced by Amoco, Kuwaits Kufpec, and state Hydro Congo. Most of this grade is sold directly into the US East Coast electric utility market, where it is used as a substitute for residual fuel oil. Even though production from the Djeno field is in decline, a sizable boost in exports is expected over the next few years, as Chevron and operator Elf bring

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the 130,000 b/d NKossa project on stream at an initial rate of 90,000 b/d in mid1996. Overall Congo production peaked at 215,000 b/d in 1994 and has been declining ever since. The inclusion of NKossa output should help output steadily rise to 250,000 b/d by 1998. Further successes with Elfs sizable offshore exploration program could very well send production even higher (see pH83-H86).

DUBAI
The emirate of Dubai is a distant second among producers in the United Arab Emirates after Abu Dhabi. But despite its small and declining output of about 275,000 barrels a day in 1996, it holds a disproportionately important role in Mideast pricing and world oil trade. Its spot market serves as the pricing benchmark for the entire region, affecting either directly or indirectly most spot and term-contract crude oil transactions in the Gulf (see pH87-H90). Because it is produced by a handful of Western oil companies with little direct role by the state, the Arab Lightquality grade has developed into a leading spot market crude oil that casts a long shadow on world markets, despite its limited production. A number of international equity producers, led by US Conoco and French Total, market most of the grade, with the vast majority of cargoes usually moving through the forward market into spot transactions. The ruler plays a passive role that has been instrumental in allowing the market to develop. The governments physical share of production is usually resold on a spot or term basis to international oil companies. (Dubais extensive benchmark role is dealt with in detail beginning on pB19). The Dubai forward market went through a confidence crisis in 1993 that reduced trading in the second half of the year and caused operator Conoco to revise the general terms and conditions of its trading contract. However, with the emergence of swaps trade to complement forward markets, trade figures are back up and can run as high as 2-million b/d in paper transactions. During quieter periods, as little as 200,000 b/d can change hands. Declining production and the heavy dependence of the forward market on spread trading against Brent have called into question the durability of Dubai as a marker grade. However, with few alternatives available and a general reluctance by Mideast producers to encourage direct spot trading, Dubai could well endure as the key regional benchmark grade despite its limitations. Currently, US traders Phibro and Morgan Stanley are the largest players in the Dubai market, which is also dominated by equity producers Conoco, Repsol, and British Petroleum. However, since Conoco tightened up the nominations procedures, trade has been bustling with new players and some old ones that are only now reemerging. Trades of full 500,000 barrel cargoes and partial cargoes as small as 50,000 barrels are actively exchanged in forward and swaps markets. Elf, Koch, Vitol, Kanematsu, and Itochu have been joined by Glencore, Arcadia, and Coastal in returning Dubai crude oil trade to the center of prominence in Mideast and Asian markets. Statoil and other Atlantic Basin producers also use the Dubai market to hedge sales to the Asia-Pacific region.

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Dubai looks both east and west, with trading activity and pricing closely linked to Atlantic Basin markets and UK Brent crude oil trading, while most of the oil is shipped to Japan, India, Singapore, and South Africa. Japan alone imports about 25%, or some 75,000 b/d. Volumes only occasionally move west when arbitrage opportunities are strong, and this is often through the internal downstream system of one of the equity producers. In 1995, Koch imported one cargo of Dubai and was the only US refiner to do so. Dubai also exports about 25,000 b/d of Margham Condensate, which heads exclusively to Asian markets.

ECUADOR
Ecuadors upward of 250,000 barrels a day of sour crude oil exports have been marketed primarily on the US Gulf Coast by a slew of trading companies, with Quito-based Tripetrol and Glencore the most prominent among them. Ecuadors benchmark grade Oriente acts as a key price indicator for US sour crude oil markets. Some oil is also sold to East Asia, mainly to refiners in South Korea, with the US West Coast and Brazil serving as secondary outlets as well. Volumes have been growing, and the countrys decision to leave Opec back in 1993 only enhanced its ability to push ahead its full-throttle export strategy. Oriente grade is Ecuadors main export grade, and it is becoming progressively heavier as new streams are added to the baseload output of the mature Shushufindi field (see pH91). Exports have increased from 180,000 b/d in the early 1990s to almost 250,000 b/d at present as a result of new production and lower domestic refinery runs. Oriente grade is exported from the Balao terminal in 50,000 ton ships, the maximum size that can pass through the Panama Canal. It is similar in quality to US Alaskan North Slope, and it is sold on an f.o.b. basis. Once it is waterborne, the grade is actively traded, despite Ecuadoran laws that prohibit the sale of crude oil to traders, which are honored more in their breach than in their observance. All shipments to the primary market on the US Gulf Coast move through the Panama Canal. All Oriente crude oil is sold initially by Petroecuador, and it is priced off spot market quotes of US West Texas Intermediate, with a freight ceiling built in to make the grade attractive to buyers on the US Gulf Coast. Oriente was the last formula priced crude oil to abandon Alaskan North Slope as a market grade in early 1996. Tenders for term contracts are awarded on a yearly basis, usually in increments of 12,000 b/d, but they can be as much as twice that level. Petroecuador would like to contract all of its crude oil on a term basis, but it has been forced to sell on the spot market during pricing spats with some of its larger customers. Petroecuadors biggest problem has been the high concentration of its sales among a relatively small number of customers. Traders such as Tripetrol and Glencore continue to maintain a stranglehold on the Oriente term-contract market through a variety of subsidiaries and shell companies such as Tevier, Oil Tex, Anglo Energy, and others. However, South Korean buyers Yukong and Lucky Goldstar have managed to break the grip somewhat and now make up one-sixth of all contract holders, with over 50,000 b/d of volume. Customers also include former equity producer Texaco, Argentine trader Interpetrol, and US Tosco. Petroecuador has occasionally

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pursued crude oil-processing deals in the US, Venezuela, and Puerto Rico, but so far it has only been able to strike up intermittent deals with Venezuelas Corpoven.

EGYPT
Egypts roughly 350,000-400,000 barrels a day of crude oil exports are generally made up of benchmark Suez Blend and a handful of smaller-volume, heavier grades, including Belayim, Ras Budran, and Ras Gharib. However, much of this oil is handled by equity producers that sell only about 175,000 b/d to third parties outside of their own systems. State Egyptian General Petroleum Corp. markets another 170,000 b/d of crude oil under term contracts. Besides EGPC, US Amoco is the countrys biggest crude oil exporter, marketing just over 100,000 b/d, primarily in the Mediterranean. Some of these Suez Blend cargoes appear on the spot market. Italys Agip is the next biggest seller among equity producers at some 75,000 b/d, or about four cargoes a month from its 230,000 b/d Belayim field. Beginning in 1996, the grade is going to be jointly marketed by Agip and state EGPC on the Mediterranean spot market, since the Italian firm found it difficult to market the grade at posted prices set by the state. Shell, British Petroleum, German Deminex, and US Phillips all produce equity crude oil, but they usually do not market it to third parties. Egyptian grades are high in sulfur and range from 34-gravity Suez Blend to much heavier oils. After numerous customer complaints, EGPC has simplified its unusually complex crude oil-pricing formula system for its term-contract sales to a simple link with dated Brent. From 1992 through 1995, Egypt had used a basket of three benchmark grades: UK Brent, Iran Heavy, and spot quotes for Suez Blend. These three grades were used to determine a value for Suez Blend, which accounts for 80% of Egypts 950,000 b/d of crude oil production, with other grades priced off it. However, lack of liquidity in the spot market for Iran Heavy and Suez Blend forced EGPC to drop these elements, which accounted for 40% of the overall formula (see pH93-H102). On the marketing front, EGPCs former 45,000 b/d term contract with Israel, which was its largest, has been reduced to less than half this amount in 1996, with Israel opting to play the market now that other Arab producers have dropped their second degree boycott. EGPC has a score of other, smaller contracts, primarily with traders and European refiners. Along with Israel, Egypts main customers continue to be Mobil and Star Enterprise in the US, along with two of South Africas four main refineries. Sales to the US are on the rise, with over 50,000 b/d expected in 1996, up from just over 30,000 b/d in 1995. New production of heavy grades Zaafarana, Gharib, and Geisum is popular among sophisticated refiners in the US. Egypts most important asset is not necessarily its crude oil, but probably its location, which makes it a key intermediary between Mideast producers and Western markets. The Sumed pipeline from Ain Sukhna on the Red Sea to Sidi Kerir on the Mediterranean regularly carries 1.6- to 1.8-million b/d of Mideast crude oil into Europe, while volumes through the Suez Canal, which are limited to fully laden 150,000 deadweight ton ships, average 1.2-million b/d. Other than Egypt itself, the chief clients of Sumed are Saudi Arabia, Iran, Kuwait, and some of their customers. Sumed and the Suez Canal save 10 days of travel time to Europe, and Sidi Kerir is used in the market as an f.o.b. sales point for Saudi and Iranian grades. The

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Sumed pipeline has been expanded, with the ability to carry up to 2.34-million b/d, but it has operated at just under 2-million b/d.

GABON
Gabons roughly 340,000 barrels a day of crude oil exports are dominated by Royal Dutch/Shell and Elf Aquitaine, which have substantial equity production that has been steadily increasing since 1987. Its rising flows prompted it to follow Ecuador in leaving Opec in 1996. Gabon exports three main types of crude oil: Rabi Export Blend, Rabi Light, and Mandji. Rabi production from a conglomeration of mid-gravity, low-sulfur producing fields has reached its plateau output level of some 200,000 b/d, and it will probably stay there well into the next century (see pH103-H108). Rabi is sold in two forms. The first, Rabi Export Blend, is a combination of Rabi and Gamba crude oil, which makes up a 100,000 b/d export stream sold by Royal Dutch/Shell. Gamba was originally sold separately, but it was incorporated into Rabi when the latter, a much larger stream, began production in 1989. Elf markets 100,000 b/d of the second type, Rabi Light, which is not blended with Gamba and is therefore slightly higher in quality. The 90,000 b/d offshore Mandji crude oil is Gabons main sour grade, and it is marketed by Elf as a slightly higher-quality equivalent to US Alaskan North Slope. Three other grades, Lucina, MBaya, and Oguendjo make up the balance of exports. Shell sells one 350,000 barrel cargo a month of Lucina, which is Gabons lightest-gravity, low-sulfur export oil. MBaya and Oguendjo are both sold in single cargoes on a quarterly basis by producers Elf and Kelt Energy. In the 1990s, Gabon has established a wider market for its grades. Although they were once just Atlantic Basin grades, Mandji and Rabi have gained widespread acceptance in Far East markets. Japanese utilities have found Rabi to be an excellent substitute for medium and heavy Indonesian grades that are used in direct burning under boilers. Japanese imports of Gabonese grades ran as high as 40,000 b/d in 1993, but they have since tailed off due to competition from new Australian light sweet grades. South Korean, Singapore, and Chinese refiners have also dabbled with spot cargoes. Gabonese grades are sold almost exclusively on a spot basis, with prices related to dated Brent and sometimes Alaskan North Slope or West Texas Intermediate when they are headed toward the US. While Europe was once Gabons key market, sales have been growing to US buyers, which are now a primary destination. US imports have tripled since 1991 to around 250,000 b/d in 1995. Key buyers include British Petroleum, Tosco, Coastal, and Phibro. In Europe, Elf still lifts 30,000-40,000 b/d of equity production, with Portugal being the next largest buyer at less than 10,000 b/d in 1995.

INDONESIA
Indonesias oil export-sales system is among the least transparent in East Asia because it is divided up among state Pertamina, its marketing affiliates, and a score

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of international companies with equity production. It also involves a score of different grades, although its main Minas and Duri fields account for the bulk of international sales. With domestic demand cutting into exports, marketing operations are being consolidated, but they remain complex. State Pertamina and its affiliates only handle about 45% of total exports of about 800,000 barrels a day, with the foreign partners moving the rest. The state firm forms the nucleus of the system, with its unusual term-contract pricing mechanism used as the basis for almost all export sales and for the division of costs and profits in the upstream production-sharing deals that account for most of the output. The export activities of the international equity producers vary considerably, with some keeping almost all of the oil in their own systems and others selling most of their crude oil to third parties. One feature of the Indonesian export market is the relatively small volume of spot transactions in any single grade. This is partly due to the fragmentation of export sales volumes and the preference of most parties for term contracts (see pH109-H128). Indonesia exports about 55% of its crude oil and condensate production of around 1.5-million b/d. State Pertamina has fought off the spectre of declining exports by increasing imports from Iran, Saudi Arabia, and sometimes Libya to meet annual domestic demand growth of 6%-8%. While Japanese sales are less than they were five years ago, Tokyo remains Indonesias largest customer, taking 600,000 b/d. Other customers include South Korea, China, the US, Australia, Taiwan, and Singapore. With sales to Japan shrinking, Pertamina merged its two affiliates, Japan-Indonesia Oil Co. and Far East Oil Trading Co., into Pacific Petroleum and Trading Company in late 1995. PPTC is half-owned by Pertamina, with the rest held by various Japanese refiners, including Nippon Oil, Idemitsu, Cosmo, and several electric, steel, and gas companies. PPTC holds a formal contract for roughly 100,000 b/d of direct sales to Japanese refiners and power utilities. However, the volume of sales handled by the company often exceeds contract levels, which are regarded as baseload supply by Japanese refiners. Pertamina has three other crude oil marketing affiliates Indoil, Perta Oil, and Korean Indonesian Petroleum. Another marketing associate, Permindo, which is owned by Pertamina and a private local group, controls the bulk of Indonesias products trade. It also handles third-party processing deals for Pertamina. Hong Kong-based Perta Oil is responsible for estimated crude oil sales of 60,000-65,000 b/d, mainly to China. Among equity producers, the largest volume firms are also the largest exporters. Caltex leads the way with its Minas and Duri grades, followed by Mobil, Maxus, Total, and Arco. Minas crude oil alone accounts for about 30% of all Indonesian oil exports by far the largest stream. Mobil markets 30,000 b/d of the 90,000 b/d Arun condensate production, but most of its entitlements go to its affiliates, with occasional cargoes being sold to third parties on the spot market. By contrast, Maxus, the producer of Widuri which, at about 100,000 b/d, is one of the larger export grades sells all of its share of output to third parties, mainly in Japan. Indonesias crude oil pricing system is a unique mixture of formula and

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retroactive assessments. Prices are set monthly on the basis of the previous months spot assessments for a basket of five crude oils made by the Asian Petroleum Price Index. Average differentials for the previous 52 weeks are applied to determine the final prices, with special adjustments for harder-to-market grades. While the system is complex and mechanical, it is clearly defined, like a price formula. At times, it has encountered serious problems when the crude oil differentials have failed to reflect current market values, which has happened in periods of seasonal or extreme market weakness. Despite some complaints from market participants, Pertamina seems unlikely to modify the system in any significant way.

IRAN
Unlike producers such as Saudi Arabia and Mexico, which rely on long-term relationships forged through standard term contracts, Irans large export sales of some 2.6- to 2.8-million barrels a day depend much more heavily on fluctuating strategies that are continuously adjusted to match changing circumstances. The constant threat of further US sanctions has made these strategies all the more useful in 1996. State National Iranian Oil Co., which is the countrys exclusive seller despite past efforts by some interests in Tehran to set up alternative channels, uses perhaps the widest array of marketing techniques of any oil exporter. The imposition of harsher US sanctions on Iran in early 1995 forced a 400,000 b/d shift in Irans customer base, as large US buyers such as Exxon, Coastal, Mobil, and Caltex were no longer allowed to buy Iranian crude oil, even for their overseas refineries. For a time, much of this volume was sold on a spot basis along with the standard 300,000 b/d or so of spot availability, but significant amounts are now bought under contract by Mediterranean refiners. Irans incremental supply role has caused it to lose some popularity among its customers when NIOC is too stiff in its pricing demands. However, the firm almost always manages to sell its available crude oil regardless of market conditions and competition from other Opec producing nations or Russia, even if it sometimes must put several cargoes to sea unsold (see pH129-H138). In recent years, Iran has used a wide range of marketing techniques. It has made varying use of traders as marketing intermediaries, while also relying on barter, prefinancing deals, crude oil-for-product swaps, sales from storage, spot deals, delivered sales in Europe and the Mediterranean, and a host of other alternatives to traditional f.o.b. term contracts. At one time, traders were heavily relied upon to market spot barrels on a delivered basis in Northwest Europe, until NIOC assumed this role itself. Intermediaries sometimes perform a similar role in the Mediterranean, and they also provide products in return for crude oil. In general, NIOC tends to cut back on its use of middlemen when they start to undermine its sales in a local market, but the firm relies on them as a way to move marginal barrels up until that point. Traders also play a role in markets that are not easily accessible or where buyers have credit problems, such as India and Eastern Europe. NIOC has its own trading venture called Nafta-Iran Intertrade, which markets some spot barrels in Europe. The more traditional term contracts that Iran maintains are kept up annually with Asian customers, mainly in Japan and South Korea. Current sales to Asia

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run in the 900,000 b/d to 1.1-million b/d range, spread out among nine countries. Prices are under the standard monthly formula terms with fairly predictable volumes. The only wrinkle in Irans Asian pricing is the linkage of Iran Light grade exclusively to Oman as a benchmark and Iran Heavy to Dubai. This is a variation on the typical Saudi preference for an average of the two. Traders are sometimes used to augment these Far East sales volumes. European and South African sales, which make up most of the rest of Iranian exports, are the other extreme, with heavy competition from Russian spot sales in the Mediterranean forcing NIOC to remain constantly innovative in its sales strategy. About 55%-65% of Irans exports go to Europe and South Africa at formula prices linked to spot North Sea Brent levels, whether the oil is sold from its main loading terminal at Kharg Island, sold in the Mediterranean, or delivered into Rotterdam. However, these proportions can fluctuate wildly when marketing opportunities unveil themselves in higher-priced regions. Pricing is mostly handled on a cargo-by-cargo basis with substantial variation among buyers. NIOC shifts back and forth over time between various sales points in Rotterdam, the Mediterranean, or the Mideast Gulf, depending on market circumstances. Tanker chartering by state NITC can offer a glimpse of directional changes in flows between eastern and western markets. Many Western buyers consider their purchases to be spot rather than term no matter how regular and stable their volumes are. South Africa has emerged as Irans largest buyer, lifting over 200,000 b/d, followed by Greece, British Petroleum, Italys Isab, Royal Dutch/Shell, and Turkey. Some refiners, particularly in the Mediterranean region, hold frame contracts that loosely define volumes to be lifted each quarter, but not the price. US sales remain suspended, and NIOCs marketing efforts have been complicated by the tight US government restrictions that prevent any US refiner from utilizing Iranian crude oil anywhere in the world. A full-scale revival of sales into the US depends on a further easing of restrictions by Washington, which is unlikely to occur anytime soon, as politicians in both major US parties firmly support the sanctions. Irans exports vary significantly from month to month and among grades, depending both on marketing pressures and its own internal needs. Iran Light exports range from 35%-45% of the total, while Iran Heavy accounts for 45%-50% and offshore grades 12%-18%, or about 450,000 b/d. Virtually all offshore output is exported.

IRAQ
Before invading Kuwait in August 1990, Iraq had overtaken Iran as Opecs secondlargest crude oil exporter, with overseas sales of almost 3-million barrels a day in the first half of that year. But the United Nations embargo since then excluded Iraq from world markets until December 1996 and has left Baghdad at the mercy of UN Security Council decisions about its export status. In 1996, the first signs emerged of a limited return of Iraq to world oil markets under the auspices of a humanitarian aid program, with these efforts coming to fruition at the end of the year. Exports of 550,000 b/d of crude oil were expected to resume in early 1997 from both the Turkish export pipeline to Ceyhan on the Mediterranean and from the Iraqi terminal of Mina AlBakr on the Gulf. Iraq has long been considered an expert marketer, with large and effective pre-war sales of its three grades worldwide 37-gravity Kirkuk, produced in the north, and 35-gravity Basra and 27-gravity Fao Blend, produced in the south (see pH139H144). Through its state marketing arm Somo, Iraq previously sold its crude oil at formu-

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la prices that were highly competitive with prevailing Saudi, Iranian, and Kuwaiti terms, often varying significantly between individual customers in the same geographical region. A similar approach is being used under the UN oil sales program, in which the proceeds from the oil sales are to be used to buy food and medicine for the people of Iraq. Prior to the UN oil-for-aid program, Iraqs only sanctioned crude oil exports went to Jordan under a special UN exception to the embargo. The 40,000-60,000 b/d has been sold under concessionary price terms and was supplemented by refined product exports of about 20,000 b/d. Turkey and Iran have been receiving oil as well, with volumes varying between 25,000 b/d and 75,000 b/d, despite a lack of UN approval. With the humanitarian oil sales program, Iraq has reestablished relations with numerous customers, both old and new. It has targeted sales in all three main markets to a wide range of buyers. Iraq firmly believes that the oil-for-aid program is a first step toward a full lifting of sanctions and that it needs to position itself in world crude oil markets for further large increases in sales. Buyers are also concerned about possible changes in the quality of Iraqi oil during the long hiatus, during which excess fuel oil was reinjected into some of the fields. Small term contracts are thus likely to be the focus of the 550,000 b/d of new UNapproved sales.

KUWAIT
Term-contract sales are the backbone of Kuwaits crude oil marketing policy. Fully recovered from its traumatic destruction at the hands of the Iraqi military in 1990, state Kuwait Petroleum Corp. is selling as much crude oil now a total of almost 1-million barrels a day to third-party buyers as it did before the war. Kuwaits single export grade tends to be difficult to market because it is relatively heavy and sour, which prompted a strategy of diversifying into refined product exports and overseas downstream investments, mainly in Europe. Growing domestic refinery capacity has eaten into available crude oil export volumes in 1995-96 (see pH145). KPC handles all of the countrys crude oil sales and has sought out new termcontract customers in Latin America, Africa, and Asia, sometimes displacing other Mideast suppliers with more rigid terms. In the US, for example, Kuwait has committed itself to delivered sales in the US market, which puts it on an equal footing with short-haul supplies. But the US and other Atlantic Basin destinations have borne the brunt of the reductions in crude oil export volumes caused by the rise in domestic refinery capacity to a planned 875,000 b/d by 1997. In Asia, Kuwait has improved the quality of its exports by spiking kerosine into export cargoes in order to boost the light-product yield of the oil. Concentrated marketing efforts in the Far East had boosted sales to Asia to 550,000 b/d, a volume that is likely to increase as several new refining projects come on stream. Japanese refiners are the largest buyers of Kuwaiti crude oil, lifting up to 175,000 b/d under term contracts. The marketing of exports from its 50% share of Neutral Zone crude oil production is handled mainly by the equity producers there and mainly ends up in Asia (see separate section on Neutral Zone, pF23). South Korea,

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Taiwan, India, and the Philippines are also large buyers. Volumes to India and South Korea are likely to expand the fastest, with several grassroots refineries being built in each country. KPC also processes some of its own crude oil in Singapore, and it refines as much as 800,000 b/d in its own domestic plants, which are primarily export-oriented. KPC sells its crude oil in all major markets worldwide, usually pricing its 31gravity Kuwait grade under formula terms at a slight discount to or in line with similar-quality Arab Medium crude oil in all of these markets. Total crude oil exports through mid-1996 were 1.3-million b/d, including its share of the Neutral Zone. Less than 100,000 b/d was destined for its own refineries in Europe, which rely heavily on North Sea grades. The largest customers for Kuwaits crude oil exports are major oil companies such as Exxon, Shell, Chevron, and Indian Oil Corp. Brazils Petrobras suspended its 50,000 b/d contract due to price disagreements in late 1995, and the crude oil has been transferred to South African buyers, which lifted almost 100,000 b/d in 1996. Like Saudi Arabia, Kuwait has tended to shy away from marketing heavily in Europe due to intense competition from Iran and Russia. Nevertheless, KPC manages to sell a nearly equal amount of crude oil in the US and Europe. Other US buyers include Ashland, Marathon, and Fina.

LIBYA
Libyas international political isolation has led it to pursue a policy of locking in customers for as much of its roughly 1.1-million barrels a day in crude oil exports as possible. Adding to the already troublesome financial sanctions imposed by the United Nations, more stringent US government sanctions have been added in 1996, including a ban on the sale of certain oil equipment and considerably broader unilateral US restrictions. However, Tripoli has been able to maintain a business-asusual attitude, and traditional European customers appear willing to stick with the oil, despite regular complaints about stiff price terms. Libyas tightly controlled and unwavering marketing strategy reflects a desire to tie all crude oil sales into deeper commercial relationships with customers linked to investment or barter. Libyas close ties to the continental European market are a direct result of Tripolis strained relationship with the US, UK, and France. The US has maintained a stiff embargo on Libyan exports since 1985, and the UK and France have supported the 1993 and 1996 tightening of trade and financial sanctions by the UN and US, respectively, which affected oil sales indirectly by forcing Libya to use banks based in third-world countries. Almost all of Libyas term-contract customers already have a special relationship of some sort with Tripoli. About 80% of exports are handled through these contracts, with the remainder taken by European equity producers as their share of production. Through Geneva-based Oilinvest which is controlled, although not majority-owned, by Tripoli Libya has direct interests in refineries in Italy, Germany, and Switzerland that give it an outlet for 300,000 b/d of crude oil exports, including some resales. Government-to-government deals with Turkey, Greece, South Korea, and Spain

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are tied to more complex economic packages involving an element of barter. The next largest group of crude oil purchasers are equity producers Agip, OMV, and Veba, which buy term-contract supplies on top of their equity volumes. The heavy dependence of Italy, Switzerland, Germany, and Austria on Libyan crude oil and the investments in these countries are designed to shield Libyas oil revenue from international political pressure. Libyan crude oil is no longer prominent in the Mediterranean spot market, where light, sweet Es Sider grade was once considered an important benchmark. Libya sets the prices for its term-contract sales under typical formula terms tied to the dated Brent market, with all sales on an f.o.b. basis. Other than Es Sider, Libya offers six other export grades ranging from 36- to 41-gravity (see pH147-H160). Aside from its heavy European sales orientation, some of its heavier waxy grades sometimes move to Asian markets when the arbitrage is attractive.

MALAYSIA
State Petronas takes the lead role in the countrys crude oil export trade, with main equity producers Shell and Exxon playing a support role that involves shipments of their own equity supplies mainly within their refining systems. With production of crude oil and condensate steady at about 650,000 barrels a day, a little over half was exported in 1995, mainly to customers in Asia. Exports of the countrys benchmark Tapis grade are slightly down since 1994 due to higher domestic refinery runs associated with the opening of a refinery refinery at Melaka. Petronas is generally entitled to at least one-half of all crude oil output, while equity-producing companies take the rest. The five crude oil export blends, in order of importance, are Tapis, Labuan, Miri, Bintulu, and Dulang. Output of high-quality Tapis is about 350,000 b/d, while Labuan and Miri hover around 100,000 b/d each (see pH161-H170). Petronas moves its exports through three different channels. Term contracts with several regional customers amounted to about 250,000 b/d in 1995, with occasional processing arrangements in Singapore and Yemen totaling about 40,000 b/d and another 50,000 b/d or so reaching the international spot market through regular auctions. Petronas usually tenders one or two cargoes of Tapis and one each of Labuan and Dulang every month, amounting to about 2-million barrels in all. Tapis, noted for its yield of top-grade gasoline and middle distillates, is one of Asias most popular spot grades, but exported volumes are likely to shrink as domestic refining grows. This downward trend means it is unlikely that Tapis will achieve full-fledged marker status. Heavier Labuan makes a good grade of middle distillates and is usually priced a few cents a barrel lower than Tapis. Dulang is a similar light, sweet, but waxy crude oil that is priced closer to Indonesian Minas grade. Petronas has a well-diversified slate of term-contract sales mainly to Japan, South Korea, Taiwan, and India that accounts for most of its offtake. A new 1996 link with South African refiner Engen is likely to increase shipments there. The Petronas sales are made based on monthly average assessments of Tapis crude oil. Petronas used to apply retroactive monthly prices, which were set with ref-

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erence to regional spot market levels. But the system was changed twice in 1995, with Petronas settling on direct linkage to monthly average assessments from Platts and the Asia Petroleum Price Index plus an adjustment factor. Customers had complained that the previous formula did not accurately reflect market prices.

MEXICO
Mexicos state oil company, Pemex, has faced a perpetual conflict between satisfying domestic demand, which has grown rapidly, and maintaining crude oil exports, which generate a large share of Mexicos foreign exchange. Sustained efforts to increase crude oil production and curb domestic demand through higher product prices and increased utilization of gas have helped boost Mexican crude oil exports to over 1.5-million barrels a day. By emphasizing term relationships and competitive pricing, Mexico has been able to increase crude oil exports by over 200,000 b/d in the past few years. PMI, Pemexs international marketing arm, offers three export grades: Isthmus (33-gravity, 1.5% sulfur), Maya (22-gravity, 3.3% sulfur), and Olmeca (39gravity, 0.77% sulfur). Available volumes of each grade fluctuate due to seasonal variations in domestic refiner needs, but Pemex has generally shifted its export slate in favor of lighter, sweeter grades. In late 1993, volumes were averaging 250,000 b/d for Isthmus, 800,000 b/d for Maya, and 230,000 b/d for Olmeca. By first-half 1996, Olmeca sales had jumped to 460,000 b/d, while Isthmus and Maya exports were holding fairly steady. New light fields in the Bay of Campeche have been boosting Olmeca (see pH171-H176). Some 75% of Mexicos 1.5-million b/d in crude oil exports are sold to a wide range of US refiners on a term-contract basis. Shell and Mobil are by far the largest buyers, lifting over 200,000 b/d each, with Chevron and Exxon next at 125,000 b/d each. Spanish refiner Repsol, in which Pemex owns a 5% stake, is also a large buyer at 150,000 b/d, while other European firms take much smaller volumes. In the US, a Pemex joint refining venture with US Shell at its Deer Park, Texas, plant has locked in 110,000 b/d. Shell, on its own account, lifts at least another 125,000 b/d for its US refineries. Many US Gulf Coast and Midwest buyers regard Mexico as a key baseload source of crude oil supply, much like Saudi Arabia. In the past, Pemex put a strict limit of 50% of exports on sales to the US, but now, with a more market-oriented strategy in place, PMIs customer list includes a full range of over 20 major and large independent US refiners. Mexico is also responsible for one-half of the crude oil supplied along with Venezuela under the San Jose Accord, which serves lesser-developed Latin American and Caribbean countries. These volumes vary widely. Japan has a long-term, government-to-government contract for a mix of Isthmus and Maya that has been scaled back to 75,000 b/d. Mexicos customers are steady and have tended to change little over the years, although with increased exports of Olmeca, more sweet crude oil refiners have signed up. Term contracts are valued particularly on the US Gulf Coast because Mexico is a short-haul, secure supplier that is willing to adjust volumes with great

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flexibility on a month-to-month basis. However, buyers of Mexican oil also face the most complex crude oil-pricing formula system in the world. Current formulas include differentials to weighted combinations of US West Texas Sour, Alaskan North Slope, and Light Louisiana Sweet, Oman, Dubai, dated UK Brent, and various grades of residual fuel oil. PMI also sometimes makes single spot deals that it calls trial cargoes in order to satisfy official Mexican restrictions against spot sales or resales by term customers.

NEUTRAL ZONE
The Neutral Zone is controlled jointly by Saudi Arabia and Kuwait, each administering part of it and dividing revenue equally from the oil, which is produced under traditional Mideast concession contracts. This shared sovereignty has prevented the kind of nationalizations that were common throughout the Mideast oil industry in the 1970s. As a result, the Neutral Zone consists of two completely separate production and marketing entities that are united only by the similar nature of the grades that they export. Virtually all of the Neutral Zones output of 480,000 barrels a day is exported. Production in the western zone, which is almost all onshore, is the responsibility of Texacos affiliate Getty and state Kuwait Oil Co., while the eastern area, exclusively offshore, is managed by Japans Arabian Oil Co., with 10% shares in each operating company held by the governments of Kuwait and Saudi Arabia. Crude oil types are all relatively heavy and sour: Onshore Wafra at 22to 24-gravity is among the heaviest grades in the region, and it is being joined by even heavier 18-gravity Eocene flows in 1997, which are expected to reach 50,000-60,000 b/d. Offshore Khafji is similar in quality to Arab Heavy, and offshore Hout ranks somewhere between Arab Light and Medium (see pH177-H182). Most of the sales for these grades are under term contracts, which are vital to smooth marketing due to the smaller volumes and poor quality of the oil. Arabian Oil Co. markets the offshore output, taking much of it back to refiners in Japan, while the onshore production has been kept within the downstream systems of the equity producers or sold mainly to Japanese customers. Formula pricing dominates AOC sales, with tight linkage to Saudi terms. About 50% of the 270,000 b/d offshore Khafji production is sold into Japan, with the rest going to other Asian buyers. Most of the 30,000 b/d Hout flow is taken by Japan National Oil Co. for the countrys strategic oil stockpile. Since the AOC concession is Japans largest source of equity crude oil, making it a prized and secure source of supply for Tokyo, the marketing of this oil in Japan is usually relatively easy and uncompetitive. In particular, the JNOC purchases of Hout help the grade to overcome its relatively unattractive Arab Lightlinked prices. The AOC output alone accounts for half of Japanese overseas equity crude oil production. Meanwhile, pricing of Texacos 220,000 b/d Wafra crude oil production is less transparent, and marketing had become more difficult due to unrepaired damage to the onshore Mina Saud refinery during the Iraqi invasion. Long-term considerations are likely to affect the future development and marketing of Neutral Zone grades. Texaco has been disappointed with its efforts to find deeper light crude oil deposits, and the firm has proposed steamflooding and other heavy-crude oil production measures. AOC is committed to a large offshore investment and development program. Both of these new sources of supply depend on renewal of the existing concessions. AOCs concession expires in 1999,

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and Texacos in 2009. While Kuwait has expressed a willingness to extend the current accord with AOC, the Saudi position has been clouded by its previously planned downstream investment program in Japan, which was called off in late 1993. AOCs decision to begin the long-term investment program, which includes new investment and replacement of the aging infrastructure, is a sign that the concession is likely to be renewed.

NIGERIA
Nigerian grades are widely considered to be among the most desirable export grades available in the Atlantic Basin. Their high yields of both gasoline and gas oil make them popular in both the summer and winter and offer refiners the maximum in operational flexibility. The countrys 1.7- to 1.8-million barrels a day of crude oil and condensate exports have a major impact on the North Sea market and its benchmark Brent grade, and they represent one of the most actively traded international spot markets, after the North Seas. Crude oil sales are handled both by state Nigerian National Petroleum Corp. and by its international equity producing partner companies. Nigerias 2-million b/d of production is divided on a roughly 60-40 basis between majority share owner NNPC and its main equity partners Royal Dutch/Shell, Texaco, Chevron, Mobil, Phillips, Agip, Ashland, and Elf Aquitaine. In addition to their 750,000-800,000 b/d equity shares, the international oil companies also receive extra volumes from NNPC as payment for the state firms share of joint-venture operations and investments. As a result, total volumes exported by the equity producers are about 900,000 b/d, most of which goes into their own downstream refining systems. NNPC consumes about 200,000-300,000 b/d in its domestic refineries and exports about 800,000 to 1-million b/d under term contracts as well as additional volumes for overseas processing to cover Nigerias domestic product deficit. Nigerias exports go mainly to the US Gulf and East coasts as well as to Spain, France, Germany, and other European buyers. Some small volumes flow East of Suez, but these are largely incremental sales that are a function of arbitrage opportunities. The so-called BBQ grades Bonny Light, Brass River, and Qua Iboe are in especially high demand during the summer due to their exceptionally high gasoline yields, while Forcados is considered one of the best gas oil-producing grades in the world. By extension, Bonny Light and Qua Iboe are sometimes referred to as the BQ grades because they are priced at parity (see pH183-H194). Virtually all Nigerian crude oil sales, whether on a spot or term basis, are priced at a differential to dated Brent, even on sales to the US. The term-contract price conditions are adjusted by NNPC on the third week of the current month for the following calendar month. NNPCs term customers vary somewhat arbitrarily depending on the whims of government policy, with traders and European firms holding most of the contracts under the awards made in late 1995. However, this customer list is the worlds most fluid and can change more

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than once a year. The past use of term-contract awards as a way to lure investment into Nigeria has been largely unsuccessful. A system of commission fees and commercial agents also clouds relationships between NNPC and its customers. Pricing is generally quite competitive, although buyers are quick to cut back liftings if the oil is considered too expensive and the potential for resale is deemed unprofitable. At times NNPC has resorted to special discounts, such as the use of netback pricing on Forcados grade in late 1992, in order to maintain offtake. However, Nigeria is not a big user of alternative marketing techniques to maintain volumes, and its price terms generally apply uniformly to all term customers. NNPCs use of Brent-based term-contract pricing into the US is unusual among exporting countries, but it seems to work well because of the close links between Nigerian crude oil trading and the North Sea Brent market. The abundance of traders holding term contracts and the large volume of exports in the hands of equity producers guarantee an active physical spot market. However, any trading firms interested in joining the fray should be warned that theres no market with a greater number of sophisticated traders. Some of the businesss more clever spot traders such as Glencore, Vitol, and Addax tend to be the most prominent players, with Morgan Stanley also taking a substantial role. Forcados and Bonny Light are the countrys most heavily traded spot grades, with Nigerian spot trading usually following the lead of the UK Brent market. As far as end-users go, Amerada Hess, BP America, and Sun tend to be the largest lifters in the US, while Repsol, Elf Aquitaine, and Total carry the brunt of European purchases. India, Pakistan, and South Africa have cumulatively begun lifting 200,000-300,000 b/d in recent years.

NORWAY
Norway is the quiet sister of North Sea crude oil marketing, but it has expanded its output steadily and now ranks as Europes largest oil producer and crude oil exporter, and as the second-largest crude oil exporter in the world. While UK Brent gets tossed around from trader to trader in a constant effort to determine its absolute price, Norwegian grades move along more quietly, trading at a differential to dated Brent. The volumes of the Norwegian crude oil streams are large and often outpace UK crude oil markets, but the Norwegian grades have grown up in the shadow of the highly visible and active UK trade, and as a result, they are rarely in the spotlight despite their now-large volumes. Through early 1996, Norwegian crude oil production had swelled to over 3-million barrels a day, with the addition of 260,000 b/d from the Heidrun and Troll fields. More increases are expected in the late 1990s. Some 30 companies produce crude oil in Norway, which flows into 10 main grades Ekofisk, Statfjord, Gullfaks, Gullfaks C, Oseberg, Brent, Forties, Draugen, Heidrun, and Yme. The four main grades Ekofisk, Statfjord, Oseberg, and Gullfaks are high-quality, light, sweet oils, though high acidity levels in new Heidrun grade have made refinery upgrades mandatory for some of its customers (see pH195-H210). The two largest equity producers are Statoil and Norsk Hydro, with Statoil also handling the governments large direct stake in some of the fields. Other significant producers include Royal Dutch/Shell, Phillips, Saga, Petrofina, Mobil, Exxon, Elf Aquitaine, and British Petroleum. Roughly half of Norways oil output is loaded directly at the production platforms, while the balance is

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loaded at terminals in Sture and Mongstad, Norway, and Teesside, UK. The table below gives a idea of which Norwegian fields are used in making the countrys 10 export blends.

NORWAYS CRUDE STREAMS


Crude Blends Ekofisk Statfjord Blend Oseberg Blend Gullfaks Blend Gullfaks C Brent Blend Forties Draugen Heidrun Yme Contributing Fields Ekofisk, Embla, Gyda, Hod, Tommeliten, Valhall, Ula Statfjord, Snorre, Statfjord East, Statfjord North Oseberg, Veslefrikk, Brage, Fry, Lille-Frigg Gullfaks A, Gullfaks B, Gullfaks West Gullfaks C, Tordis Murchison Heimdal, Condensate Draugen Heidrun Yme

1995 Output Shipment Point (1,000 b/d) Terminal, Teesside, UK 481 Buoy via Mongstad, Norway 790 Terminal, Sture, Norway 695 Buoy via Mongstad, Norway 582* Bouy via Mongstad, Norway Terminal, Sullom Voe, UK 3 Terminal, Cruden Bay 8 & Hounds Point, UK Buoy 99 Buoy via Mongstad, Norway 118 Buoy via Mongstad, Norway 33

*Gullfaks Blend and Gullfaks C averaged 582,000 b/d in 1995.

About half of Norways production is kept within the refining systems of the equity producers in Europe and the US, with the remainder sold to third parties, usually on a spot basis. New grades Troll and Heidrun are being marketed through term contracts, though due to the competitive, spot orientation of North Sea trading, only part of Norways output is sold on a term-contract basis. Even so, Statoil has successfully built up new long-term outlets both in Europe and North America. Norway has about 270,000 b/d of domestic refining capacity, and the country relies almost entirely on its own output. Small volumes are imported from nearby Danish and UK fields, with occasional volumes also coming from Russia. Like the UK producers, Norway announces loading programs each month, which provide the basis for extensive spot and forward trading. Norways largest outlet is the UK refining sector, which alone absorbs about 600,000 barrels a day, or 20% of Norways crude oil, followed by the Netherlands and Germany, which each take about half that volume. The US market has grown from less than 50,000 b/d in 1990 to over 250,000 b/d in 1995, with shipments to Canada also approaching 200,000 b/d in 1995. Norwegian marketing in North America has been facilitated by the use of long-term storage in the Bahamas. Statoil is also targeting Asia and has begun to sign up some term customers there, including a 20,000 b/d deal with CPC Taiwan.

OMAN
Rising production and shifting preferences of Asian refiners have made the marketing of Omans crude oil more challenging in the 1990s, but the level of spot trade has not increased noticeably as a result, and it may even have declined. Help from trader Transworld Oil and equity producer Royal Dutch/Shell as well as overseas refining ventures have provided new outlets, as have growing term sales to rapidly expanding Asian markets in South Korea and elsewhere. Although Oman blend is slightly lower in sulfur than typical Saudi and Iranian grades, it does not have the appeal of the higher-quality Abu Dhabi and Qatar grades for Asian refiners (see pH211). While Japanese sales volumes have remained fairly stable, a broadening of the marketing base was needed as output has climbed to 870,000 barrels a day, and other buyers have indeed been found. South Korean refiners have increased their purchases

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in recent years. Shell has become a regular third-party term lifter in addition to its sizable equity volumes, some of which are resold under term contracts. Trader Transworld Oil has played a key marketing role as a leading term customer in the past, but its role as a reseller seems to be diminishing. Other firms, such as Finlands Neste, also play a similar role in resales of term barrels. The vast majority of Omani barrels, both from equity producers and state Petroleum Development Oman, continue to go to a growing number of customers in Asia. PDOs term-contract volumes were in the area of 375,000 b/d in early 1995. Other than large purchases by Japanese and South Korean buyers, the balance of sales is spread among the emerging markets of Asia. Omani barrels also move into Hawaii and the US West Coast at a rate of 25,00050,000 b/d, with Chevron, BHP, and Tosco the most consistent buyers. Oman crude oil trading provides the most active spot market in the region after Dubai, and as a result, it is used as a reference level for most term-contract price formulas for Mideast grades. However, trading is limited in scope and closely linked to Dubai. The forward market that had been emerging in Omani crude oil in the late 1980s has dried up, and activity is focused almost completely on physical wet barrels, as interest from Wall Street firms and Japanese trading houses has ebbed. As with Abu Dhabi grades, virtually all spot trade is done on the basis of a differential to monthly retroactive prices set by the government and usually referred to as Oman MPM (Ministry of Petroleum and Minerals). Pricing of term supplies is more complex than it appears, and it has, at times, created some confusion in the market. Prices are set retroactively after the end of the month, but since all spot trade is based on the MPM price, the Dubai market provides an outside reference point. Other inputs include Abu Dhabi spot prices and regional refinery yields. Confusion and risk for buyers and sellers sometimes comes in the setting of the MPM price, which usually fluctuates between 15 and 85 a barrel relative to Dubai and depends on the methodology used by price-reporting services. This uncertainty and ambiguity about the MPM price not only has an impact on the spot market for Oman crude oil, which trades at a differential to it, but also influences all of the formula prices in the region. Some companies have argued for a simpler pricing mechanism, particularly for Western destinations, but Oman has declined because of an aversion to seeing its crude oil used as a spot benchmark.

PAPUA NEW GUINEA


Papua New Guinea started selling its high-quality light, sweet Kutubu crude oil on the world market in mid-1992, and output averaged about 140,000 barrels a day in 1993. But by 1995, production had stabilized at about 100,000 b/d. Operator Chevron has outlined ambitious plans to stem the declines in Kutubu and push output back over 115,000 b/d in 1996 and expects to add another 52,000 b/d of production from the Gobe field by 1998 (see pH213). But these increases will mainly offset an expected fall-off in the original Kutubu field. The government markets its share of Kutubu production independently, as do the two leading equity producers, Chevron and

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British Petroleum. Other, smaller equity producers have formed a consortium to handle their barrels. Refiners in Australia and China are the main customers, taking about 30% each. South Korea, Taiwan, other Asian countries, and the US also take some barrels. Kutubu crude oil is particularly prized for its high naphtha yield and good gasoline-manufacturing properties. Most supplies are sold on the basis of term contracts. These deals are linked to spot quotes for Malaysian Tapis grade from the Asian Petroleum Price Index for the three weeks around the date of loading, with a discount. However, a significant share is also retraded on the spot market.

QATAR
Qatar has had problems in the 1990s managing its upstream operations and launching its liquefied natural gas export projects, but its crude oil marketing has operated relatively smoothly. Qatari grades are light and sweet by Mideast standards similar to those of Abu Dhabi which has made them especially popular with Japanese and South Korean refiners. In Japan, particularly, the emphasis on making light products from expanding but relatively unsophisticated refineries has enhanced Qatari grades value. Qatar produces two types of crude oil, Qatar Marine and Qatar Land or Dukhan, averaging a total of 450,000 barrels a day in 1995 (see pH215-H218). The country also currently produces about 45,000 b/d of condensate, mostly for export, a volume that is likely to grow in the future with the associated development of its LNG operations in the next five years. In 1995, Mitsubishi, Itochu, Marubeni, Idemitsu, and Mitsui locked up 205,000 b/d of Qatars 345,000 b/d of crude oil contracts by signing up for 30,000-50,000 b/d each, and Japanese refiners Cosmo and Nippon grabbed another 30,000 b/d between them. Mobil was the only major international oil company with a term contract, which makes sense given its heavy involvement in Qatars two aspiring LNG projects, Qatargas and Ras Laffan. The withdrawal of a Shell-led group of foreign firms managing the countrys onshore and offshore upstream oil operations and their subsequent replacement under a 1994 management contract with Occidental did not affect Qatars pricing system or crude oil exports. Term-contract prices are set retroactively every month by state Qatar General Petroleum Corp. through a formula that is linked to Omans MPM posting. Price levels usually track the values of similar Abu Dhabi grades closely. As well as providing technical assistance to QGPC in upstream developments for five years, Occidental also landed a production-sharing deal to enhance the recovery of the offshore Idd El Shargi field.

RUSSIA
Perhaps no other country has a crude oil-marketing policy as erratic, unpredictable, bureaucratic, and disjointed as that of Russia. Oil sales were previously the paragon of central control under the Soviet authorities. The transition to a

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market economy has been neither smooth nor easy for the countrys oil industry. The most stark symptoms of this lie in Russias staggering output slide of 5-million barrels a day, or nearly 50%, since the late-1980s peak, to just under 6-million b/d in early 1996. Despite the plunge, Russia is still an important force on international markets, exporting over 1.8-million b/d of crude oil in 1995 outside the Commonwealth Of Independent States, mostly to Europe. The wide range in export levels makes the Russian Urals market one of the roughest in the world in which to trade. On top of the bureaucratic hassles, Russias oil ports are among the oil worlds most weathersensitive facilities. Seaborne exports can go from 1-million b/d one day to almost nothing the next and back to 1-million b/d a few days later. The large number of exporters also tends to create loading delays. Under the old centralized system, all oil exports were firmly in the hands of Soyuznefteexport, which provided fairly stable quality and supplies to its regular customers on a delivered basis. However, operational and logistical disruptions were common even then, especially in the winter, due in part to the systems lack of flexibility and the long distances from the oil fields. Urals grade, the standard Russian export blend, is compiled from a wide range of fields, but it is broadly similar to Arab Light or Medium at 32-gravity and about 1%-2% sulfur. While quality was always erratic for operational reasons, variability has become even wider with the breakup of the Soviet Union, the loss of export terminals, and the decline in production. A new 35-gravity, low-sulfur export grade, Siberian Light, has stabilized at volumes of around 90,000 b/d from the Black Sea port of Tuapse. Exxon and various Mediterranean refiners have emerged as the principal buyers. Nevertheless, the lack of flexibility of the Russian refining and transport system may mean wide variations in quality for some time to come (see pH219-H222). Availabilities also fluctuate seasonally, with export declines often occurring during the winter due to logistical problems and domestic needs that are severely exacerbated by bureaucratic delays. Problems with access to ports in the Baltic Sea and Ukraine have tended to increase reliance on the Russian Black Sea port of Novorossiysk, with a capacity of about 750,000 b/d. This has made exports even more vulnerable to operational problems such as storms. Smaller ports in Odessa (200,000 b/d) and Tuapse (250,000 b/d) can also be utilized on the Black Sea. The Baltic port of Ventspils, Latvia (290,000 b/d), is also used. The Friendship, or Druzhba, pipeline delivers up to 1-million b/d of crude oil throughout Eastern Europe. The bureaucracy of Russian crude oil exports has become increasingly complex with the ongoing struggle among various central authorities trying to maintain a degree of control and the efforts of individual enterprises and regions to manage their own exports. Sales have become more fragmented, and spot deals predominate. Exporter classifications and approximate volumes can be broken down into five main categories: state-controlled trading companies (330,000 b/d); state-run vertically integrated companies (1.2-million b/d); non-state oil producers (140,000 b/d; and a variety of joint venture arrangements (250,000 b/d). While the state is still the largest seller, its volumes are handled by a plethora of agents including trader Nafta-Moscow, the descendant of the former state monopoly sell-

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er Soyuznefteexport. As many as 10 to 30 other sellers are also active, depending on political and bureaucratic circumstances, with integrated firm Lukoil the most dominant player in the market through early 1996. The state also auctions off export volumes to qualified companies. Some groups, such as foreign joint ventures and oil-production associations, have clear rights to export crude oil. But an obstacle course of quotas, licenses, and permits must be run in order to sell these volumes, and sporadic changes in regulations sometimes cause disruptions to exports. A host of constantly changing intermediary trading companies has also grown up parallel to this wider list of official exporters. As a result, Urals is probably one of the most heavily traded grades on the international spot market after Brent. This contrasts with the old Soviet system that relied mainly on sales to large Western European refiners such as Italian Agip, Finnish Neste, Spanish Repsol, and German Veba, as well as to majors such as Royal Dutch/Shell and a few intermediaries. These same refiners still buy large volumes of Russian crude oil, but the path from field to refinery is less direct. Exxon has also emerged as one of the largest buyers of Russian crude oil following Washingtons ban on purchases of Iranian crude oil by US companies even for their non-US operations. Russian exports are priced on a spot basis linked directly to North Sea Brent, but the differential is volatile and depends heavily on the degree of competition with other sour crude oil producers, especially in the Mediterranean, which has become the primary spot market arena for Urals. Prices in recent years have fluctuated from a 30 a barrel premium to dated Brent to a $1 a barrel discount. This wide ranging price differential has emerged based on the interplay between spot availabilities of Russian and Iranian crude oil, the two grades that have come to dominate the Mediterranean market. Changes in Russian or Iranian supplies also tend to set off a chain reaction of price changes in other markets, particularly the Atlantic Basin. With its spot availability plentiful, there has been some discussion of using Urals as a new benchmark grade for heavier, sour grades. Russian authorities are believed to support this idea, as do some of the East European nations that rely heavily on Russian oil. Forward trading of pipeline supplies occurs in the Druzhba system, and a cargo-based market is also a possibility. However, at a minimum, greater predictability of both government regulations, supplies, and quality are probably needed for a liquid market to emerge that could support both forward trading and independent benchmark status.

SAUDI ARABIA
Adamant that it would never again revert to the role of swing producer for Opec, Saudi Arabia introduced a new pricing system in October 1987: geographically targeted formula pricing, which was designed to protect and expand its market position. This system has become the basis for the now-widespread use of spot crude oil market-linked pricing of term-contract supplies. The kingdom simultaneously renounced the use of its crude oil as an international marker. Riyadh has since fine-tuned its formulas to guarantee a wider clientele and steady offtake even during times of market weakness. A primary Saudi objective has been to compete successfully with short-haul suppliers in distant Atlantic Basin markets. The Saudis have used two chief strategies to achieve this goal: delivered crude oil sales, mainly for smaller regional refiners in Europe and the US; and delayed pricing and guaranteed freight costs for purchases from the kingdoms ports, which are mainly by major oil com-

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panies for Western shipments. US prices are based on a differential to the spot price of US West Texas Intermediate at Cushing, Oklahoma, while sales to Europe and Latin America are tied to dated Brent. All buyers for Asia-Pacific destinations have formulas based on a monthly average of Dubai and Oman benchmark prices. These systems effectively protect buyers from the transportation and time risks that are normally associated with long voyages and put Saudi Arabia on an equal footing with competitors. Using these attractive formula-pricing mechanisms, prices can be geared to meet competitors head-on in each geographical market center for all five of the kingdoms primary export grades. In order to help bolster revenue, state Saudi Aramco has shifted sales in favor of lighter grades since 1994, tightening price terms and trimming sales volumes of its heavier grades. Arab Light is the main export crude oil and, like heavier Arab Medium and Heavy, it is relatively high in sulfur and light only by Mideast standards. Although not the most attractive grades, their large volumes make them key baseload supplies for refiners in all of the main global refining centers a status that is matched by few other grades. Saudi Arabia also exports two lighter grades, Berri and Super Light, which are similar in quality to the more attractive Abu Dhabi grades. Exports of 200,000 barrels a day of the new Super Light Saudi grade, which is low in sulfur and comparable to a North African crude oil, began in 1995, with the customer list dominated by Asian buyers. Saudi Aramco affiliate Ssangyong has contracted half the volume, with other customers picking up the balance in part to ensure access to heavier grades (see pH223-H232). Although Saudi pricing is uniform for all similar types of buyers in the same region, this system still provides for a great deal of variation because of the wide range of markets in which Saudi Arabia is active and its ability to sell large volumes on a delivered basis in the US and Europe. For example, delivered sales can occur from Caribbean or Rotterdam storage terminals; from the Sumed pipelines Mediterranean outlet at Sidi Kerir, Egypt; or by ship delivered into the US Gulf Coast. The buyers are notified of price differentials almost a month in advance earlier than by most other producers in order to provide them the time to work out all of the complex loading and sales alternatives. This early notification also allows competing suppliers such as Mexico and Venezuela to adjust their prices accordingly. Saudi delivered sales also require a large volume of working storage in the Caribbean and Europe and dozens of tankers. Atlantic Basin sales are handled primarily by Saudi Petroleum International, an Aramco affiliate based in New York and London, while Asian sales are handled through Saudi Aramco headquarters in Dhahran. Saudi sales to the US, Japan, and other key markets expanded sharply in the early 1990s, doubling in some cases. Despite the return of Kuwait to the international market and growing competition from Venezuela, Mexico, and Iran, the erosion of the Saudi sales position has only been noticeable in the US. Less Saudi emphasis has been placed on Europe, in part because of tougher competition from Iranian and Russian spot sales. Sales to the major international oil companies Royal Dutch/Shell, Exxon, Chevron, Texaco, British Petroleum, and Mobil represent slightly over 40% of the kingdoms crude oil exports and are purchased mainly from

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Saudi ports rather than on a delivered basis. These firms are also sold extra volumes on a spot basis at times, and they provide much of the flexibility in the Saudi sales program. Other clients span a wide variety of firms all over the world, with almost all refiners of any significance taking some Saudi crude oil. Sales of Riyadhs 50% share of crude from the Neutral Zone are handled by equity producers there (see separate section on Neutral Zone, pF23). Joint ventures with foreign refiners are still viewed as a future cornerstone of Saudi marketing policy, but they currently account for only about 12% of exports and are coming under greater scrutiny. Under the leadership of oil minister Ali Naimi, the question of whether Saudi funds would be better spent in the development of the domestic gas sector as a means of freeing up more oil for export has become a key area of debate. Otherwise, the Saudis are at various stages of negotiation over refinery ventures in China, India, and Italy. Current joint ventures fall far short of the kingdoms 50% long-term target for refining its own exports. But if Saudi refined product exports of 750,000 b/d are included, the share jumps to 24% of exports, which is within reach of its interim goal of 30%. Besides its Star Enterprise partnership with Texaco in the US the kingdoms largest single customer at 550,000 b/d Saudi Aramco owns 35% of Ssangyong Refining Co. in South Korea, 40% of Petron in the Philippines, and 50% of 100,000 b/d Greek refiner Motor Oil Hellas. These deals provide outlets for about 900,000 barrels a day of crude oil.

SYRIA
Syria emerged in the 1990s as an increasingly important source of supply to the Mediterranean market, but with its output of light, sour crude oil starting to decline and flows of its heavier grade now stable, its importance seems to have peaked. Syrian Light crude oil trades particularly actively in regional spot markets, with cargoes regularly resold by about 15 to 20 term-contract lifters. About 350,000 barrels a day of Syrias output of nearly 600,000 b/d was exported in 1995. Export volumes were roughly 75,000 b/d of Souedieh and 275,000 b/d of Syrian Light, with all volumes marketed by state Syrian Petroleum Co.s Sytrol unit (see pH237-H240). Souedieh is produced by the state firm at a rate of about 150,000 b/d. Syrian Light comes from a group of fields involving Shell, Deminex, Elf, and others, and output there had risen to 400,000 b/d in 1994 before beginning a gradual decline that is expected to average about 10,000 b/d each year. The equity producers are not allowed to export their crude oil, and they must sell it to the government. The countrys 220,000 b/d of refining capacity is operated at full throttle, almost entirely with domestic grades. To cope with the highly competitive sour crude oil market in the Mediterranean in the 1990s that was created by heavy spot trading of Russian Urals grade, SPC diversified its sales to a wider group of 15 to 20 term customers with flexible volumes. Its grades go mainly to European refiners, with some sales to the US that have been threatened by sanctions. Traders such as Marc Rich, Bay Oil, and Marimpex are regular buyers, as are US Conoco, Austrian OMV, and several Italian and French refiners. Prices are linked to North Sea Brent crude oil under formula terms. Syrian Light competes actively with Mideast sour grades and North African grades, but poor-quality Souedieh is sold mainly to technically sophisticated refiners,

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sometimes at steep discounts to Brent. Syrian Light has declined in quality slightly since 1994 as older production has been replaced by flows from newer fields.

UNITED KINGDOM
The British North Sea is the spot market capital of the world, and it seems likely to continue in this role for a long time to come. Although Norway has now eclipsed the UK as the largest producer in Europe, the rapid growth of British North Sea output in the late 1970s and early 1980s, when spot markets were rising to the fore, provided a natural focus for trading and price discovery. While the Brent Blend crude oil stream is the fulcrum of crude oil trading, the key international market grade comprises only about one-third of total UK production. Brent Blend is a compilation of crude oil from over 15 fields that is merged into a single 675,000 barrel a day stream at the Sullom Voe loading terminal in the Shetland Islands. Other important export streams are Forties, which is now larger than Brent at about 1-million b/d, and Flotta, which is in decline at about 250,000 b/d (see pH241-H250). All three of these main grades are loaded from terminals, which facilitates trading. Except for Flotta, all of the UK grades are light and sweet, which generally makes them attractive to refiners and relatively easy to market. There are about a dozen smaller, offshore-loaded fields, with collective output of about 500,000 b/d. These tend to be more cumbersome because of logistical constraints, confining them to Europe. However, Brent and Forties are both regularly sold outside of Europe. Due to its rising flows, Forties is expected to eventually displace Brent in the key benchmark role (for a complete discussion of the Brent market and its benchmark role, see pB9). More than half of the crude oil produced in the UK North Sea avoids the internal downstream supply systems of producing companies and is traded on a spot basis in the international market. Over the years, freedom from regulation, the efficiency of the market, and the ready availability of forward trading instruments have reinforced the preference for spot trade in the UK North Sea. The government gave up its active role in the market in 1985, and it has allowed trade to evolve and grow without much interference, despite some sporadic bouts of market difficulties, especially in Brent trade. The UK North Sea also represents the largest and most diverse concentration of international oil companies in the world, with over 50 producing firms active in almost 75 fields. The main players in the UK North Sea spot market are the big producers Shell, Exxon, and British Petroleum and some of the large Wall Street firms and European refiners. The sizable equity production of BP (425,000 b/d), Shell, and Exxon (300,000 b/d each) gives them a distinct comparative advantage in trading. They are also capable of optimizing their tax exposure by opting to trade barrels or keep them in their own systems, which has an important impact on market liquidity. Enterprise and Amerada Hess have emerged as more important players with their rising Forties flows of over 150,000 b/d each. Along with Norwegian grades, UK crude oils are the mainstay of Northwest Europes refineries. However, the UK refining sector has a high level of sophistication, so the large predominance there of sweet grades such as Brent is not ideal for the countrys own refining sector. Therefore, of the 2.5-million barrels a day

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produced in the UK, only about 800,000 b/d is refined in the nation, which has a capacity of 1.85-million b/d. Sharp increases in North Sea production in mid-1990s managed to push even more UK grades into a wider variety of markets. UK grades have found more buyers in North America, the Mediterranean, and sometimes even in the Far East, where they are coveted for their ability to produce middle distillates.

UNITED STATES
Although the US exports little crude oil, its position as a major producer and market center gives it significant international importance. The countrys position as an exporter expanded in 1996 when the ban on international sales of Alaskan North Slope was lifted. The US crude oil market is unique due to its huge size, wide dispersion of small producers, unusually heavy reliance on pipelines, and expanding appetite for imports. Primarily because of the markets size, benchmark grade West Texas Intermediate and other key US grades have broad international influence (see pH251-H260). Since the US is the worlds largest oil importer and its crude oils compete head-to-head with international grades, price trends there play an important role in the global oil market. Although exports are limited, an understanding of how the US market works is critical to a complete view of the global crude oil trade. US oil policy can also have a huge impact on international markets, with the latest examples being the sanctions that the US has imposed on Iran and Libya. Policy moves such as the decontrol of US crude oil prices from 1978-81 have also had a significant international impact. Although the ban has been lifted on US exports of ANS crude oil, total volumes seem unlikely to exceed 200,000 barrels a day to customers in the Asia-Pacific region. Initial sales in 1996 were on a spot and term-contract basis to Taiwan, Japan, and South Korea at a rate of 100,000 b/d. Small volumes of crude oil from Cook Inlet, Alaska, and California have also been exported to Asia in the past, and a limited amount into Canada, but these were all exceptions to the overall US ban on crude oil exports. Declining production on Alaskas North Slope and steady demand for the crude oil on the US West Coast limit the scope for ANS exports. The previous benchmark role of ANS for trading on the Gulf Coast has been eliminated in the mid-1990s by declining production and the shift to Asian exports. Most US crude oils are sold under monthly evergreen, or automatically renewable, contracts at prices posted by the refiners, which can change daily in a volatile market. The myriad of small producers in the country are price-takers and, in some cases, are highly dependent on one or two gathering companies to get their oil into the main pipeline systems. They typically sell the crude oil at the wellhead. This contrasts with the spot markets for US grades, which are usually located at key pipeline centers such as Cushing, Oklahoma. Deliveries there occur on a spot or cash basis and against the New York Mercantile Exchanges light, sweet crude oil futures contract, which in practice focuses almost exclusively on WTI. Local producers, refiners, and trucking companies that gather oil from the wellhead in remote areas

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are important players in the term market, and traders also get involved sometimes. Oil priced at the wellhead does find its way into a specialized spot market called the P plus, or postings plus, market. US refiners that need more domestic crude oil can use these markets to acquire lease oil on a ratable basis at prices linked to the monthly average posted contract quote for one or several refiners whose posted prices are considered most reflective of spot market trends. US pipeline supplies are also traded actively on a spot basis at key hubs. Volumes are rated on a barrel a day basis at quantities of 1,000-10,000 b/d over a month, and transactions are completed at least five days prior to the start of the delivery month in order to allow for pipeline scheduling. This also permits much smaller transactions and greater flexibility than in the international crude oil cargo market. Nymex futures quotations for WTI usually serve as a reference for most spot transactions. Widely traded grades like West Texas Sour, Light Louisiana Sweet, and Heavy Louisiana Sweet have their own trading hubs and are usually marketed at either a discount or premium to WTI prices depending on quality and location. The US oil market is going through some important changes that should have a significant impact on the competitive position of imported supplies. The decline in onshore production and rising internal demand mean increasing requirements for international supplies and pipelines to bring these crude oils to inland refiners that previously depended on domestic grades. At the same time, rising production from new offshore fields in the Gulf Of Mexico mean a more competitive environment for sour grades in that key market area. About 1-million b/d of new production is expected by 2000 from the new deep-water and sub-salt fields in the Gulf, and over 60% of this crude oil is high in sulfur like the new Mars blend. These grades are expected to be actively traded in the US Gulf spot market, competing head-to-head with Mideast and Latin American barrels. At the same time, the need to bring more international crude oil to refiners in the Midcontinent and Great Lakes regions has required the expansion of pipeline systems in order to avoid supply bottlenecks.

VENEZUELA
The marketing of Venezuelan crude oil has always been a challenge because of its relatively poor quality, but the stakes have been raised in the mid-1990s by an upswing in the countrys output and exports that now looks likely to extend for several years. State Petroleos de Venezuela has managed to meet the challenge by using a combination of old and new marketing techniques. With crude oil reserves in excess of 60-billion barrels, the country has the largest pool of reserves outside the Mideast. But PDVs Achilles heel is that much of its crude oil is heavy and high in sulfur and metals, requiring special efforts to market it. However, by building sophisticated export-refining capability and investing carefully in downstream ventures overseas, Venezuela was able to lock in secure market outlets for over half of its oil exports in the early 1990s. As a result, despite quality problems, it has made itself among the least vulnerable of Opec exporters to competitive market pressures, and it has had little trouble expanding crude oil exports to 1.8-million barrels a day in 1995 and over 2-million b/d in 1996 (see pH261-H272).

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PDV faces an uphill battle on the quality front, with its reserves dominated by heavy grades. However, most of its export growth in the mid-1990s has been with its medium- and light-gravity grades, which reflects both rising production of these oils and increased upgrading capacity at domestic refineries, allowing them to switch to heavier crude oil feedstock. There are already limits to how much heavy crude oil Venezuelas domestic and overseas refining system can take, and PDV is forced to buy significant volumes of lighter grades from other producers to supplement its own production. It also has brought in international oil companies to improve recovery from existing fields and expand output from new ones, which should add to exports in the future. These new flows could also further complicate crude oil marketing arrangements with the emergence of new sellers. In the face of these challenges, the backbone of Venezuelas crude oil export program is its overseas refining capability of about 1.5-million barrels a day, which received almost 900,000 b/d of supplies directly from Venezuela in 1995 with additional supplies purchased from the open market. This left about 925,000 b/d of domestically produced crude oil to sell to third parties. PDV also exports about 700,000 b/d of refined products from its domestic refineries, which have a capacity of 1.2-million b/d. PDVs downstream assets in the US include ventures with Citgo, Champlin, Unoven, Seaview, Chevron, and Lyondell, as well as a long-term lease on the 300,000 b/d Curacao refinery. In Europe, PDV owns shares of refineries in Germany, Belgium, and Sweden with German Veba and Swedish Nynas, amounting to some 245,000 b/d. Crude oil sales to its own downstream outlets are secured by realization pricing that ties the value of the crude oil to the output of refined products. Since 1992, Venezuela has shifted its third-party crude oil sales more heavily toward spot-linked transactions, which it had shunned previously but has since embraced wholeheartedly. This market-responsive system has allowed Venezuela to expand its international sales relatively easily since 1993 as its production has grown. Pricing terms are set individually to suit the particular needs of customers. The spot-linked sales are primarily targeted at US refiners, which took about 70% of Venezuelas 2-million b/d crude oil exports in 1996, with about a third of that 1.4-million b/d going to PDV downstream ventures. Because price terms are set individually, crude oil costs vary among customers. While the main buyers are heavy-crude oil-oriented refiners such as Mobil, Conoco, Phillips, Amoco, and Star Enterprise, new flows of lighter grades have allowed Venezuela to market to firms such as Phibro and Coastal. The new pricing strategy has helped Venezuela to expand its sales and makes it difficult for other suppliers to displace it. The preference of US refiners for low inventories also makes the nearby Venezuelan crude oil with its spot-linked pricing especially attractive. PDVs old system of postings is still in use, but it is at best only a partial indicator of price levels. The PDV postings are still used as one element in some of the new sales formulas, but prices are generally believed to be about 50 to $1 a barrel below the postings, and most formulas have a timing element to protect customers during crude oil shipment. PIW has begun tracking the formula price of Furrial crude oil, providing a more accurate measure of price levels, which appear to be quite competitive (see Furrial prices, pI29). Venezuela is likely to keep expanding its downstream network overseas as it expands its oil production because of the security this provides for crude oil sales. The more open posture Caracas has taken to international upstream investment in

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the country could also help forge such deals. However, competition in the key US market is likely to grow more intense with rising US output of sour crude oils from the Gulf Of Mexico and the reemergence of Iraq as a sour crude oil exporter. PDV subsidiaries Lagoven, Maraven, Corpoven, and Meneven are the operating companies for production and refining, and they also handle crude oil exports. PDV has sought to minimize past competition for customers among them by restricting buyers to using a single affiliate. Venezuela has over a dozen main crude oil export grades, with several other minor streams.

VIETNAM
Vietnam was a rising star of Asia-Pacific oil production in the early 1990s, but it has since lost much of its luster. Although it has managed to boost production to over 150,000 barrels a day, it has yet to live up to the hopes that many international oil companies placed on its upstream potential, and exports are likely to at best hold steady rather than more than double by 2000 as the government has projected. The problem is that all of the discoveries by international oil companies so far have turned out to be relatively small despite some promising initial assessments. The Bach Ho field, originally discovered by Mobil but developed by the Russians, is the main producing field at about 125,000 b/d (see pH273). The smaller Rong and Dai Hung fields produce most of the rest of the output, with the 25,000 b/d Ruby field slated to come on stream in late 1996. Almost all production is exported due to the lack of domestic refining capacity. Vietnams 33-gravity Bach Ho export grade is typical of medium-gravity Asian grades, which are low in sulfur but high in wax. This quality constraint and the countrys strong commercial links with Japanese trading houses mean that about 50% of exports still go to Japan, despite an effort by Vietnam to diversify its outlets. In the future, the big challenge for Vietnam as an exporter will likely be to keep its output expanding quickly enough to stay ahead of the countrys demand, which is also growing rapidly. However, plans to build a domestic refinery have stalled, and virtually all production is likely to continue to be exported until late in the 1990s. Bach Ho prices have been set with a link to similar-quality Indonesian Minas grade. State producer Petrovietnam and state oil market Petechim are both responsible for crude oil sales. In addition to the Japanese, Singapore refiners have also been active buyers. With the lifting of the US ban on trade with Vietnam in 1995, US majors such as Mobil began to buy the crude oil.

YEMEN
Although Yemen has fallen short of the high expectations that it set for its output potential, it has managed to achieve flows of about 350,000 barrels a day mainly from its Marib and Masila fields. With no major increases in production on the horizon, state Yominco started to trim its term sales on Marib crude oil in 1996 to meet rising domestic demand (see pH275-278). About 65,000 b/d of Marib is being processed at the 100,000 b/d Aden refinery to meet local product needs, leaving only about 35,000 b/d of term sales by Yominco plus offtake of about 100,000 b/d by equity producers Hunt, Exxon, and South Korean Yukong. Marib crude oil has become

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progressively lighter with the injection of condensate from associated gas, making it an extremely light 49-gravity stream. Heavier Masila is produced by Canadian Occidental and reached plateau levels of 120,000 b/d in 1994. The grades are sold by the equity producers and by Yominco, which has about a 50% share of output from both streams. Supplies move to Asia, Africa, Europe, and the US, depending on market circumstances, but Japan and other Asian markets have become primary outlets. Key Yominco buyers include Japanese refiners Japan Energy, Mitsubishi Oil, trading house Sumitomo, US Unocal, South Korean Yukong, and French Total. Traders such as Glencore and Phibro also have contracts. Exxon markets Hunts share of Marib as well as its own, keeping significant volumes in its refining system. Masila tends to compete directly with similar-quality Oman crude oil in Asian markets and sometimes is priced at a differential to it in the spot market. As an indication of Yemens solid marketing position, it is able to price its grades with direct linkage to the distant North Sea Brent market, even with its large Asian sales base. It also does not provide any timing delay in its price formula, which is customary for other Mideast producers that use spot Brent as a marker grade for their sales. Additionally, Yominco sets its price formulas quarterly rather than monthly. However, the higher condensate content of the Marib stream has made it a bit harder to sell competitively.

Trade

Table of Contents

Term Contracts & Trade Flows By Country And Company

. . . . . . . . . . . . . .G1

PIWs Term Deals By Producing Nation . . . . . . . . . . . . . . . . . . . . . . . . . . . . .G3 PIWs Term Deals By Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .G16 US Crude Oil Imports By Company And Country Of Origin, 1991-95 . . . . . .G33 US Crude Oil Imports By Country Of Origin And Company, 1991-95 . . . . . .G40

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Term Contracts And Trade Flows By Country And Company


The following tables provide unique insights into the structure of crude oil trade by presenting data that track crude oil sales volumes by company and by country. The first set of tables is from PIWs regular tracking of term contract sales volumes for crude oil. These are presented as sales from each country to particular companies and then as purchases by each company from particular countries. These data are a snapshot of the term contract arrangements that existed at a point in time during the first half of each year shown from 1989 to 1995. Users of these data should remember that term contract volumes shift constantly through the year, and the data here are simply samplings of the commitments, not measurements of the average volume for the entire year. Nevertheless, the volumes do provide a unique and highly useful indication of the relative trends in term contract sales volumes. All regularized volumes have been included here, where possible, even if they exceed the nominal term contract volume that a company might be committed to. The term contract sales volumes shown here are those by state oil companies or governments, and they exclude liftings by foreign equity producers or volumes destined for the internal market. Purchasers are shown according to their current names or names that were in use at the time of purchases. Sometimes country names are used to indicate state-to-state deals. Following the tables on term contract volumes is a set of tables that provide valuable detail on US crude oil imports by country and by company for 1991-95. Like the tables on term contracts, they show the volume of crude imported into the US by each company broken down by country of origin, and they also show the imports into the US from each country broken down by importing company. Unlike the data on term contracts, these volumes are only for the US, and they include spot purchases, equity crude production, and other volumes in addition to term contract supplies. They also are annual average volumes rather than snapshots at a particular point in time.

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PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Abu Dhabi Agip Bangladesh BPC Cosmo CPC (Sri Lanka) CPC (Taiwan) Honam Hyundai Idemitsu Indian Oil Corp. Itochu Kanematsu Kukdong Kyushu Marubeni Mitsubishi Corp. Mitsubishi Oil Mitsui Mobil Neste Nippon Oil Pakistan Petrofina RD/Shell Showa Shell Texaco Thai Oil Total (France) Tupras Yukong Total China Coastal Japan Kyung-In Phibro PNOC Yukong Total Colombia BP Costa Rica Interpetrol Mobil Murphy Petroperu Petrotrin Phibro Scanoil Sun Total Ecuador Anglo Energy Coastal 1989 ... ... ... 10 ... ... ... ... 50 10 ... 15 ... ... ... ... 15 10 ... ... 20 ... ... ... 10 10 ... ... ... ... 150 30-60 165 ... 40 ... ... 235-265 15 ... ... ... 15 ... ... 15 15 ... 60 ... 15 Volume 1992 1993 10 10 5-10 ... ... ... 20-30 20 ... ... 10 10 20 34 ... ... 60 60 20 20 10-20 10-20 17 17 10 10 ... ... ... ... 20 20 ... 20 10-15 10-15 20 20-30 20 20 40 40 10 10 20-30 20 67 67 20 20 ... ... ... ... 17 17 ... 48 17 35 442.5-482.5 537.5-562.5 30 190 ... 25 5 20 270 17 6 17 ... 17 ... ... 33 ... 17 105 12 ... ... 180 20 ... 2 10 212 16 ... ... 16 16 6 ... 16-32 ... 16 85.5-101.5 12 12 1995 ... ... 20 25 9 5 20 10 40 20 ... 17 ... 15 10 30 20 ... 20-30 20 30 10 ... 20 30 ... 16 ... ... 20 402-432 ... ... ... ... ... ... ... 16 16 ... ... ... ... 16 16 ... 16 80 12 ... Destination in 1995 ... ... Bangladesh Japan Sri Lanka Taiwan South Korea South Korea Japan India ... Japan ... Japan Japan Japan Japan ... East Kenya Japan Pakistan ... East Japan ... Thailand ... ... South Korea ... ... ... ... ... ... ... ... US Costa Rica ... ... ... ... Trinidad US ... US ... US/Latin America ...

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PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Ecuador (cont.) Commoil Copec-Chile CPC (Taiwan) Elf Glencore* Interpetrol Itochu Lucky Goldstar Marc Rich (Clarendon) Oil Tex Petrobras Phibro Ssangyong Tevier Texaco Tosco Totisa Tripetrol Wickland Yukong Total Egypt Africa Middle East Anglo Energy Bayoil BB Naft Bulk CPC (Sri Lanka) Cameli Chevron Citizens Resources Coastal Elf Exxon Gotco Greece Israel Koch Marc Rich Marimpex Mitsui Mobil Motor Oil Hellas OMV Phibro Repsol Romania Sonangol (Angola) Star Enterprise Total Indonesia FEOT/JIOC Inpex

1989 15 15 15 ... ... ... 15 25 ... ... 15 ... 25 ... ... ... ... 15 ... ... 155 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... varies ...

1992 ... ... 24 ... ... ... ... 24 12 12 ... ... ... ... ... ... ... 48 ... 24 156 10 6 6-9 6 5-7 3 3 6 3 2 3 4 3-4 8 40 5-7 6-9 4 3 4 6 7-9 5-7 3 6 4 10 169-185 180 ...

Volume

1993 ... ... ... ... ... 12 ... 27 12 12 12 0-12 ... 12 12 ... 12 12 ... 24 171-183 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 220 30

1995 ... ... ... 18 24 12 ... 36 ... 24 ... ... ... 12 12 12 12 36 12 24 246 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...

Destination in 1995 ... ... ... US/Latin America US/Latin America US/Latin America ... South Korea ... US/Latin America ... ... ... US/Latin America US/Latin America US US/Latin America US/Latin America US/Latin America South Korea ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...

*Formerly Marc Rich.

Now Pacific Petroleum & Trading Co.

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PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Indonesia (cont.) Kitco Perta Samudra Total Iran Agip API Bayoil BP Burgas Refinery Caltex Cameli Cargill Cepsa Chevron China Coastal Cosmo CPC (Sri Lanka) CPC (Taiwan) Dreyfus Elf Exxon Gdansk Refinery General Sekiyu Gotco Greece Hanwha Honam Hyundai Idemitsu Indian Oil Corp. Indonesia Isab Garrone Itochu Kanematsu Kukdong Kyung-In Marc Rich Marimpex Marubeni Mitsubishi Corp. Mitsubishi Oil Mitsui Mobil N. Korea Neste Nippon Oil Nissho Iwai Nova (Greece) OK Petroleum OMV

1989 varies varies varies 150

1992 45-50 45-50 15-20 285-300

Volume

1993 ... ... ... 250

1995 ... ... ... ...

Destination in 1995 ... ... ... ...

... ... ... ... ... ... ... ... ... ... ... ... 30 ... ... 100 ... ... ... ... ... ... ... ... ... 20 20 30 ... 40 20 ... ... 200 varies 20 20 10 30 ... 40 ... ... 20 ... ... ...

30-50 ... 30 ... ... 60-65 80-120 60-80 ... 60 ... 130-150 45 20 40 ... 50-60 250-300 ... 30 25 ... ... ... ... 30 60 ... 40-50 30 30 25 ... 100-120 ... 30 20 15 25 40 10 ... ... ... ... ... 30

... ... 60-70 80-150 ... 60-130 ... 65 ... 0-60 ... 80-125 45 20 40 ... 90 200-300 ... ... ... ... ... ... ... 30 60 ... 40-50 25 20 25 20 150-175 ... 25 25 15 20 25 ... 0-40 ... ... 60 ... 20-30

50 20-25 70 200 30 60 ... ... 15 ... 10-20 130 45 ... 30 ... 20-30 250-300 30 ... ... 100 40 65 60 50 60 ... 35 30 40 ... ... ... ... 30 20 ... 20-25 40-50 ... ... 30 ... ... 30 5-10

Italy Italy Romania/Bulgaria Europe Bulgaria East ... ... Spain ... China Europe/Caribbean Japan ... Taiwan ... France East/West Poland ... ... Greece South Korea South Korea South Korea Japan India ... Italy Japan Japan ... ... ... ... Japan Japan ... Japan East ... ... Japan ... ... Sweden Austria

Excluding purchases for South African refineries

Motor Oil Helas, DEP, and Petrola.

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PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Iran (cont.) Pakistan Petrobras Petrofina Petrogal Petronas Petronor Phibro PNOC Poland PTT (Thailand) Rafiron Repsol Romania RD/Shell Showa Shell Sinochem Sonatrach South Africa Sri Lanka Sumitomo Total (France) Toyomenka Tupras Vitol Yugoslavia Yukong Total Iraq Agip Ashland Chevron Coastal Cosmo Crown Central Elf Exoil Exxon Idemitsu Indian Oil Corp. Indonesia Kashima Marathon Mitsubishi Corp. Nippon Oil Petrobras Poland RD/Shell Repsol Showa Shell Texaco Total (France) Total 1989 ... 60 ... ... ... ... 175 ... ... ... ... ... ... 70 20 ... ... ... ... 20 ... 40 ... 100 20 ... 1,255 60 35 70 50-70 30 35-70 varies 10 200 40 70 30 10 35 20 35 150-200 25 50-100 100 10 100-150 varies 1,265-1,470 Volume 1992 1993 20 40 180 75 50-100 0-75 ... ... 15 ... ... ... 30-50 0-80 27 20 60-72 50 15 ... ... ... ... ... 16 ... 50-70 70 25 25 20 ... ... 60 ... ... ... ... 15-20 20 20 0-40 50 50-125 ... 60-80 50-60 ... ... ... 70 70 2,108-2,420 1,840-2,570 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 1995 20 60 75 30 ... 30-40 ... ... ... ... 65 30-35 ... 50 30 ... ... 200-250 20 40 10-15 60-70 100 ... ... 70 2,505-2,680 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... Destination in 1995 Pakistan Brazil Belgium Portugal ... Spain ... ... ... ... Romania Spain ... East/West Japan ... ... South Africa Sri Lanka Japan France Japan Turkey ... ... South Korea ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...

Excluding purchases for South African refineries.

BP, Shell, Caltex, Total, Sasol, and Engen.

CRUDE OIL HANDBOOK

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G7

PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Kuwait American Petrofina Amoco Ashland BP Chevron Cosmo CPC (Taiwan) Exxon Hanwha Idemitsu Indian Oil Corp. Itochu Ivory Coast Japan Energy Corp. Kuwait Pet. Intl. Kyung-In Marathon Mitsubishi Corp. Mitsui Pakistan Petrobras Petrofina Phillips PNOC RD/Shell Repsol Saras Sasol Seibu Shell US SRC Sumitomo Texaco Yukong Total Libya Agip API Borgas (Bulgaria) BP Coastal/Holborn Daewoo DEP (Greece) Elf Greece Jaco Rossi Marimpex Nova (Canada) Nova (Greece) OMV RD/Shell Repsol Sinochem a Sudan

1989 ... 60 ... ... ... ... ... ... ... 30 10 ... ... ... 130 ... ... 20 20 ... 30 ... ... ... ... ... ... ... ... ... ... 20 ... ... 320 ... ... ... ... 90 ... ... ... ... ... ... ... ... 20 ... 60 ... ...
a

1992 ... ... ... ... ... 30 30 100 ... 20 80 ... ... ... 90 20 ... 20 ... ... ... ... ... ... ... ... ... ... ... 100 ... 20 ... 20 530 ... ... ... 15-20 50 30 ... 20-30 20 60 20 ... 20-40 85-90 20 90 ... 25

Volume

1993 0-30 0-30 0-60 0-30 65 50 40 120-140 ... 40 80 10 ... ... 90 20 0-30 20 ... ... ... ... 0-30 20 180 0-30 30 ... 20 0-60 ... ... ... 60 845-1,165 100 20 varies ... 50 30-50 ... 30 20 ... ... ... 40 90 20 100 ... ...

1995 ... ... 50 ... 30-35 70 40 100-125 20 50 90-100 ... 25 10 ... ... 50 ... ... 50-70 50 25 17 ... 100-150 ... 20 30 20 15 30 ... 35 70 997-1,107 100 20 ... ... ... ... 20 40 ... ... ... 10 40 110 ... 100 ... ...

Destination in 1995 ... ... US ... US Japan Taiwan East/West South Korea Japan India ... Ivory Coast Japan ... ... US ... ... Pakistan Brazil Belgium US ... East/West ... Italy South Africa Japan US Singapore ... US South Korea ... Italy Italy ... ... ... ... Greece France ... ... ... Europe Greece Austria ... Spain ... ...

KPC processing deals.

Dormant contracts.

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Libya (cont.) Tamoil Total (France) Tupras Total Malaysia Astra BP Cosmo CPC (Sri Lanka) CPC (Taiwan) Elf Exoil Exxon Hanwha Honam Idemitsu Indian Oil Corp. Kyung-In Marubeni Mitsubishi Corp. Mobil Nippon Oil PNOC PTT (Thailand) RD/Shell Showa Shell Singapore Petroleum Sinochem Taiyo Texaco Yukong Others Total Mexico American Petrofina Amoco BP Central America Cepsa Chevron Citgo Clark Coastal Conoco Elf Ertoil Exxon Fina Hunt Israel Japan Koch Lyondell Marathon Mobil 1989 100 ... ... 270 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 15 ... ... ... 30 120 75 ... 20 50 20 ... 30 ... ... ... 180 ... 60 90 90 1992 240-280 ... 60 755-835 5 5-10 ... 10 ... 5-10 5-10 30-35 ... 15 5 30 10-15 ... 5-10 10-15 10-15 5-10 15 5-10 ... 5-10 ... 15-20 10-15 15-20 ... 215-285 20 65 ... ... 40 120-130 40 35 35 30 15 10 30 ... 5-10 30 100 10 70 60 100 Volume 1993 250 20 48 818-838 ... ... 5 6 9 ... ... ... ... 17 5 30 21 3 8 ... 15 ... 5-10 ... 3 ... ... 15-20 ... 32 20-25 194-209 25 65 ... ... ... 120 60 30 30 40 ... ... 15 ... 8 ... 100 20 30 60 125 Destination 1995 in 1995 250 Germany, Switzerland, Italy 10 France 50 Turkey 750 ... ... ... 5 6 9 ... ... ... 10-15 12 5 10 ... 3 8 ... 15 ... 10 ... 3 ... 20 20 ... 17 ... 153-158 ... 65 20 50 20 125 20 30 30 80 ... ... ... 30 5 ... 80 25 ... 20-25 90 ... ... Japan Sri Lanka Taiwan ... ... ... South Korea South Korea Japan India ... Japan Japan ... Japan ... Thailand ... Japan ... China Japan ... South Korea ... ... ... US Spain Central America Spain US US US US US ... ... ... US US ... Japan US ... US US

CRUDE OIL HANDBOOK

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G9

PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Mexico (cont.) Murphy OMV Petro-Canada Petrofina Petrogal Petromed Petronor Phillips Repsol S. Korea San Jose Accord Shell Canada Shell US Sun Total (France) US SPR Others Total Nigeria Addax Amni Arcadia Attock Basic Resources a Calson (Vitol) Chevron Clarendon (Glencore) Citizens Resources Coastal Dreyfus Elf Erik Emborg Ertoil Ferrostaal Ghana Hachuel Oil Incomed Interpetrol IPCO ITOC Itochu Lyondell Mapco Marc Rich Metalchim Moncrief Oil Neste Neste/Thyssen Nigermed Nova (Canada) Nova (Greece) OK Petroleum Oranto (First Fuels)

1989 15 5 ... 20 10 40 50 ... 100 ... 45 ... 65 ... 60 45 ... 1,235 100 ... ... ... ... ... 50 ... ... ... ... 50 ... 50 ... ... ... ... ... ... ... ... 30 50 ... ... ... ... ... ... ... ... ... ...

Volume 1992 1993 18 ... 25 30 15 15 30 ... 30 ... 20 ... ... ... ... ... 190 160 10 ... 53 50 ... 4 60-70 80 30 30 25 30 ... ... ... 80 1,321-1,346 1,207 ... ... ... 40 30 ... 50 ... ... 30 30 30 ... 30 ... 30 ... ... 30 ... 10 30 ... ... 40 20 ... 40 20 30 20 ... 20 ... ... ... 20 45 30 ... 50 ... 30 30 30 60 ... ... ... 20 ... 30 ... ... ... 30 ... ... 30 20 ... 40 ... 30 20 ... ... ...

1995 15 ... 10 14 13 ... ... 20 85 ... ... 3 120 15-20 20 ... ... 1,005-1,015 ... 20 20 ... 20 30 ... 30 ... ... ... ... 30 20 40 20 30 30 ... 20 ... 20 ... ... ... ... 20 ... ... ... 20 20 20 20
a

Destination in 1995 US ... Canada Belgium Portugal ... ... US Spain ... ... Canada US US France/UK ... ... ... ... East/West East/West ... East/West East/West ... East/West ... ... ... ... East/West Spain East/West Ghana East/West East/West ... East/West ... East/West ... ... ... ... East/West ... ... ... East/West East/West Sweden East/West

Beginning in May 1995, Shells contract increased from 50,000 b/d to 120,000 b/d.

Addax in 1989.

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Nigeria (cont.) Petrogas (Glencore) Petrojam Petromed Phibro Queen Petroleum Ragma Oil Repsol RD/Shell Scandinavian Trading Southern Petroleum Sun Tevier Texaco Togo Total (France) Toyomenka Veba Vermont (Vitol) Vitol VTT Vulcan Wind Pemiy NV Wintershall Total Oman BP Caltex CPC (Taiwan) Elf Hanwha Honam Idemitsu Itochu Kashima Kukdong Kyung-In Marubeni Mitsubishi Corp. Mitsui Mobil Neste Nippon Oil Nissho Iwai PTT (Thailand) RD/Shell Sinochem Sumitomo Transworld Yukong Total Qatar British Aerospace Cosmo CPC (Taiwan) Elf Exxon 1989 ... ... 70 60 ... ... ... 50 ... ... 75 ... ... ... 80 ... ... ... ... ... ... ... 665 ... ... ... ... ... ... 40 ... 10 ... ... ... ... ... 20 ... 20 ... ... ... ... ... 50 ... 140 ... ... ... 15 ... 1992 ... 20 ... ... ... ... ... 30 ... 40 60 ... 30 ... ... ... 30 ... ... ... ... ... 740 7 ... ... 10 ... 20 30-40 20 12 10 15-20 10 17 12 ... 20 20 ... 10 40 ... ... 110 ... 363-378 10 15 10 35 25 Volume 1993 ... 20 ... 30 ... ... ... ... ... 30 60 40 30 ... ... ... 30 ... ... ... ... ... 755 ... ... 15 10 ... 22 30-40 20 12 ... 32 10 17 12 ... 20 20 10 ... 40 ... 10 110 29 419-429 ... 20 10 ... ... 1995 30 ... ... ... 20 20 40 ... 20 ... ... ... ... 10 40 30 ... 20 30 30 30 30 780 10 10 15 10 20 20 35 15 10-15 ... ... 10 10 10-15 10 ... 20 10 ... 50 20 10 50 20 365-375 ... 20 10 15 ... Destination in 1995 East/West ... ... ... East/West East/West Spain ... East/West ... ... ... ... Togo East/West East/West ... East/West East/West East/West East/West Germany ... East East Taiwan East South Korea South Korea Japan Japan Japan ... ... Japan Japan Japan East ... Japan Japan ... East China Japan East South Korea ... ... Japan Taiwan East ...

CRUDE OIL HANDBOOK

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PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Qatar (cont.) Golden Bell Gulf Interstate Honam (via Caltex) Idemitsu Itochu Kanematsu Kyung-In Marubeni Mitsubishi Corp. Mitsui Mobil Nippon Oil Pakistan Petrobras Texaco Total (France) Yukong Total Saudi Arabia Agip Amoco API Aramco Partners Chevron Exxon Mobil Texaco Ashland BP Cepsa Cosmo CPC (Sri Lanka) CPC (Taiwan) Elf Greece Hanwha Hess Honam Hunt Hyundai Idemitsu Indian Oil Corp. Indonesia Irving Oil Isab Garrone Japan Energy Corp. KPI/KPC Kukdong Kyung-In Lion Oil Lyondell

1989 ... ... ... ... 30 15 ... 50 50 20 25 ... ... 25 ... ... ... 230

1992 ... 25 ... 30 50 ... 8 50 50 ... 25 10 ... ... 10 ... 10 338

Volume

1993 ... ... ... 30 50 ... 10 50 50 ... 25 10 ... 25 ... 20 10 335

1995 10 ... 10 30 50 ... ... 45 50 30 25 10 10 20 ... ... 10 345

Destination in 1995 South Korea ... South Korea Japan Japan ... ... Japan Japan Japan East Japan Pakistan Brazil ... ... South Korea ...

50 50 ... 950 ... ... ... ... 100 100 100 ... ... 50-100 50 ... ... ... ... ... ... ... 60 ... ... 35 60 ... ... ... ... 50

60 100 20 1,405-1,550 300-325 650-700 375-425 80-100 150 140 60 50 ... 100 50 50 ... ... 30 ... ... 100 100 20 50 30-50 100 75 20 ... 25 50

60 120 ... 1,455-1,650 300-325 700-800 375-425 80-100 150 190 60 70 ... 100 50 50 ... 35 30 ... ... 100 100 ... 50 30 100 ... 45 20 ... ...

70 50-55 20 1,100-1,170 270 450 300-350 80-100 50 185 75 60 5 90 65 80 20 65 30 12 50 120 120 ... 50 30 100 ... ... ... 25 ...

Italy US Italy East/West East/West East/West East/West East/West US East/West Spain Japan Sri Lanka Taiwan France Greece South Korea US South Korea US South Korea Japan India ... US Italy Japan ... ... ... US ...

Includes both contractual and extra-contractual volumes.

Motoroil Hellas, DEP and Petrola.

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Saudi Arabia (cont.) Marathon Mindo/Pertamina Mitsubishi Corp. Mitsubishi Oil Neste Nippon Oil OK Petroleum Pakistan Petrobras Petrofina Petrogal Petrolimpex Petron Phibro Phillips PNOC Repsol Rheinoil RD/Shell Saras Shell US Sinochem Ssangyong Star Enterprise Sun Taiyo Total (France) Tupras Yukong Total Syria Agip API Bayoil BP Cepsa Chevron Coastal Conoco Elf Marc Rich/Galaxy Glencore Isab Garrone Lebanon Mobil OMV Repsol Rheinoil Socap Texaco Total (France) Tupras Veba Total

1989 60 ... 100 ... 90 ... ... ... 120 ... ... ... ... ... 50 ... ... 35 300 ... ... ... ... 550 50 ... 50 ... ... 3,060-3,110 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ...

Volume 1992 1993 125 125 ... ... ... 58 50 20 30 ... 50 70 ... ... 50 40 150-200 200 20 20 ... ... 25 ... ... ... 15 ... 60 60 60 60 30-50 100 90 90 600 800 ... 35 50 50-80 25 ... 200 170-300 550 550 50 50 ... ... 50 50 160 160-180 50-100 80 5,275-5,560 5,603-5,978 ... ... 20 ... ... ... ... ... ... ... ... ... 40 ... 20 ... ... ... ... 20 ... 20 120

1995 100 55 60 20 ... 100 50 45 150 65 65 ... 150 ... 65-75 ... 100 90 550-600 ... 30 30 350 550 75-80 50-60 90 176 80 5,568-5,718 20 10 ... 25 2 10 15 25 20 3 20 15 ... 10 10 25 20 3 20 30 20 35 338

Destination in 1995 US Indonesia Japan Japan ... Japan Sweden Pakistan Brasil Belgium Portugal ... Philippines ... US ... Spain Germany East/West ... US China South Korea US US Japan France/South Africa Turkey South Korea ... Italy Italy ... Europe Spain Europe Europe Europe France Europe Europe Italy ... Europe Austria Spain Germany Europe Europe France Turkey Germany ...

20 16-25 30-33 ... ... ... ... 30-33 6-12 30-33 ... 16-25 20 ... 20 ... 6-12 ... ... 30-33 ... 30-33 254-299

Includes both contractual and extra-contractual volumes.

Arab Super Light spot purchases.

CRUDE OIL HANDBOOK

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G13

PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Venezuela Amoco API Caribbean Gulf Cameli Central America Cepsa Chevron Cibro Citgo Clark Coastal Conoco Elf Ergon Exxon Hunt Koch Lyondell Mobil Murphy Nynas Nynas Sweden Nynas UK Petrobras Petrotrin Phibro Phillips RD/Shell Ruhr Oel San Jose Accord Smith & Hollander Star Enterprise Sun Tarmac Texaco Trifinery Unoven Veba Total Vietnam Idemitsu Japan Energy Corp. Kuo International Marubeni Mitsubishi Corp. Mitsui Nichimen Nippon Oil Nissho Iwai RD/Shell Sinochem Sumitomo Total

1989 40 ... ... ... ... ... 20 ... 255 ... ... 20 ... ... ... ... ... ... 40 ... 30 ... ... ... ... ... ... 30 150 45 ... ... 20 ... ... ... ... ... 650 ... ... ... ... ... ... ... ... ... ... ... ... ...

Volume 1992 1993 18 20 2 ... ... ... 1 ... ... ... 4 ... 13 25 ... 7-10 310-350 300-320 ... ... 26 15-30 85 60-70 7 ... 8 15-25 25 10-20 6 8 15 15-25 1 100 35 30-100 ... ... 24 25 ... ... ... ... ... ... ... ... 1 0-75 ... ... 23 23 200 200 53 50 6 ... 42 50-60 37 15-20 30 ... 18 10 9 15-20 120 120 ... ... 1,117.2-1,157 1,113-1,366 7 ... 7 5 25 5 2 5 25 12 7 3 103 9 8 10-20 5 27 5 ... ... 27 ... ... 14 105-115

1995 50-60 ... 35-40 ... 30 15-20 15 ... 300-320 8-16 8-10 40 ... 22 ... 8 10 130 130 15 ... 10 30 50 15 45 30 15 ... ... 5 40 ... ... 35-40 15 135 40 1,281-1,336 ... ... ... ... ... ... ... ... ... ... ... ... ...

Destination in 1995 US ... Puerto Rico ... Central America Spain US ... US US US US ... US ... US US US US US ... Sweden UK Brazil Trinidad US US Europe ... ... UK US ... ... US US US Germany ... ... ... ... ... ... ... ... ... ... ... ... ... ...

Joint venture with state PDV in 1995. Crude invoiced at an internal transfer price, based on the crude feedstock netback value. Citgo venture includes Champlain and Seaview.

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY PRODUCING NATION (In 1,000 b/d)


Yemen Agip Chevron Coastal Cosmo Elf Glencore Hess IPG (Kuwait) Mitsubishi Corp. Mobil Phibro RD/Shell Shell US Unocal Total Grand Total 1989 20 ... ... ... 10 ... 20 ... ... ... ... 10 20 ... 80 9,920-10,205 1992 ... 10 ... ... ... ... ... 10 ... 22 ... ... ... ... 42 Volume 1993 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 1995 ... ... 25 10 ... 25 ... 25 5 ... 20 ... ... 20 130 Destination in 1995 ... ... East East ... East ... East Japan ... East ... ... East ... ...

14,454-15,311 14,744.1-16,575 14,945-15,490

CRUDE OIL HANDBOOK

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G15

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Addax Nigeria Africa Middle East Egypt Agip Abu Dhabi Iran Iraq Libya Saudi Arabia Syria Yemen Total Amerada Hess Saudi Arabia Yemen Total American Petrofina Kuwait Mexico Total Amni Nigeria Amoco Kuwait Mexico Saudi Arabia Venezuela Total Anglo Energy Ecuador Egypt Total API Iran Libya Saudi Arabia Syria Venezuela Total Arcadia Nigeria Ashland Iraq Kuwait Saudi Arabia Total Astra Malaysia Attock Nigeria 1989 100 ... ... ... 60 ... 50 ... 20 130 ... 20 20 ... 15 15 ... 60 ... 50 40 150 ... ... ... ... ... ... ... ... ... ... 35 ... 100 135 ... ... 1992 ... 10 10 30-50 ... ... 60 ... ... 100-150 ... ... ... ... 20 20 ... ... 65 100 18 183 12 6 18 ... ... 20 ... 2 22 ... ... ... 150 150 5 40 Volume 1993 ... ... 10 ... ... 100 60 20 ... 190 35 ... 35 0-30 25 25-55 ... 0-30 65 120 20 205-235 12 ... 12 ... 20 ... 16-25 ... 36-45 20 ... 0-60 150 150-210 ... 45 1995 ... ... ... 50 ... 100 70 20 ... 240 65 ... 65 ... ... ... 20 ... 65 50-55 50-60 165-180 12 ... 12 20-25 20 20 10 ... 70-75 20 ... 50 50 100 ... ... Destination in 1995 ... ... ... Italy ... Italy Italy Italy ... ... US ... ... ... ... ... East/West ... US US US ... US/Latin America ... ... Italy Italy Italy Italy ... ... East/West ... US US ... ... ...

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Bangladesh Abu Dhabi Basic Resources Nigeria Bayoil Egypt Iran Syria Total BB Naft Egypt Borgas (Bulgaria) Libya BP Colombia Kuwait Libya Malaysia Mexico Oman Saudi Arabia Syria Iran Total BPC Abu Dhabi British Aerospace Qatar Bulk Egypt Burgas Refinery Iran Calson (Vitol) Nigeria Caltex Iran Oman Total Cameli Egypt Iran Venezuela Total Cargill Iran Caribbean Gulf Venezuela Central America Mexico Venezuela Total 1989 ... ... ... ... ... ... ... ... 15 ... ... ... ... ... 100 ... ... 115 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 1992 5-10 30 6-9 30 20 56-59 6 ... 17 ... 15-20 5-10 ... 7 140 ... ... 184-194 ... 10 5-7 ... ... 60-65 ... 60-65 3 80-120 1 84-124 60-80 ... ... ... ... Volume 1993 ... 30 ... 60-70 30-33 90-103 ... varies 16 0-30 ... ... ... ... 190 ... 80-150 286-386 ... ... ... ... ... 60-130 ... 60-130 ... ... ... ... 65 ... ... ... ... 1995 ... 20 ... 70 ... 70 ... ... 16 ... ... ... 20 10 185 25 200 456 20 ... ... 30 30 60 10 70 ... ... ... ... ... 35-40 50 30 80 Destination in 1995 ... East/West ... Romania/Bulgaria ... ... ... ... US ... ... ... Spain East East/West Europe Europe ... Bangladesh ... ... Bulgaria East/West East East ... ... ... ... ... ... Puerto Rico Central America Central America ...

CRUDE OIL HANDBOOK

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G17

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Cepsa Iran Mexico Saudi Arabia Syria Venezuela Total Chevron Egypt Iran Iraq Kuwait Mexico Nigeria Saudi Arabia Syria Venezuela Yemen Total China Iran Cibro Venezuela Citgo Mexico Venezuela Total Citizens Resources Nigeria Egypt Total Clarendon (Glencore) Nigeria Clark Mexico Venezuela Total Coastal China Ecuador Egypt Iran Iraq Mexico Nigeria Syria Venezuela Yemen Total Coastal/Holborn Libya Commoil Ecuador 1989 ... 30 100 ... ... 130 ... ... 70 ... 120 50 ... ... 20 ... 260 ... ... 75 255 330 ... ... ... ... ... ... ... 30-60 15 ... ... 50-70 20 ... ... ... ... 35 90 15 1992 ... 40 60 ... 4 104 6 60 ... ... 120-130 50 300-325 ... 13 10 559-594 ... ... 40 310-350 350-390 ... 3 3 ... 35 ... 35 30 ... 2 130-150 ... 35 30 ... 26 ... 253-273 50 ... Volume 1993 ... ... 60 ... ... 60 ... 0-60 ... 65 120 50 300-325 ... 25 ... 560-645 ... 7-10 60 300-320 360-380 30 ... 30 ... 30 ... 30 ... 12 ... 80-125 ... 30 30 ... 15-30 ... 167-227 50 ... 1995 15 20 75 2 15-20 127-132 ... ... ... 30-35 125 ... 270 10 15 ... 450-455 10-20 ... 20 300-320 320-340 ... ... ... 30 30 8-16 38-46 ... ... ... 130 ... 30 ... 15 8-10 25 208-218 ... ... Destination in 1995 Spain Spain Spain Spain Spain ... ... ... ... US US ... East/West Europe US ... ... China ... US US ... ... ... ... East/West US US ... ... ... ... Europe/Caribbean ... US ... Europe US East ... ... ...

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Conoco Mexico Syria Venezuela Total Copec-Chile Ecuador Cosmo Abu Dhabi Iran Iraq Kuwait Malaysia Qatar Saudi Arabia Yemen Total Costa Rica Colombia CPC (Sri Lanka) Abu Dhabi Egypt Iran Malaysia Saudi Arabia Total CPC (Taiwan) Abu Dhabi Ecuador Iran Kuwait Malaysia Oman Qatar Saudi Arabia Total Crown Central Iraq Daewoo Libya DEP (Greece) Libya Dreyfus Iran Nigeria Total Elf Ecuador Egypt Iran Iraq Libya Malaysia 1989 50 ... 20 70 15 10 30 30 ... ... ... ... ... 70 ... ... ... ... ... ... ... ... 15 ... ... ... ... ... 50-100 65-115 35-70 ... ... 100 ... 100 ... ... ... varies ... ... 1992 30 ... 85 115 ... 20-30 45 ... 30 ... 15 50 ... 160-170 6 ... 3 20 10 ... 33 10 24 40 30 ... ... 10 100 214 ... 30 ... ... 30 30 ... 3 50-60 ... 20-30 5-10 Volume 1993 40 30-33 60-70 130-143 ... 20 45 ... 50 5 20 70 ... 210 ... ... ... 20 6 ... 26 10 ... 40 40 9 15 10 100 224 ... 30-50 ... ... 30 30 ... ... 90 ... 30 ... 1995 80 25 40 145 ... 25 45 ... 70 5 20 60 10 235 16 9 ... ... 6 5 20 5 ... 30 40 9 15 10 90 199 ... ... 20 ... ... ... 18 ... 20-30 ... 40 ... Destination in 1995 US Europe US ... ... Japan Japan ... Japan Japan Japan Japan East ... Costa Rica Sri Lanka ... ... Sri Lanka Sri Lanka ... Taiwan ... Taiwan Taiwan Taiwan Taiwan Taiwan Taiwan ... ... ... Greece ... ... ... US/Latin America ... France ... France ...

CRUDE OIL HANDBOOK

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G19

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Elf (cont.) Mexico Nigeria Oman Qatar Saudi Arabia Syria Venezuela Yemen Total Ergon Venezuela Erik Emborg Nigeria Ertoil Mexico Nigeria Total Exoil Iraq Malaysia Total Exxon Egypt Iran Iraq Kuwait Malaysia Mexico Qatar Venezuela Saudi Arabia Total FEOT/JIOC Indonesia Ferrostaal Nigeria Fina Mexico Gdansk Refinery Iran General Sekiyu Iran Ghana Nigeria Glencore Ecuador Syria Yemen Total Golden Bell Qatar 1989 20 50 ... 15 50 ... ... 10 145 ... ... ... 50 50 10 ... 10 ... ... 200 ... ... 30 ... ... ... 230 varies ... ... ... ... ... ... ... ... ... ... 1992 15 30 10 35 50 ... 7 ... 225-250 8 ... 10 30 40 ... 5-10 5-10 4 250-300 ... 100 30-35 30 25 25 650-700 1,114-1,219 180 ... ... ... 30 30 ... ... ... ... ... Volume 1993 ... 60 10 ... 50 6-12 ... ... 246-252 15-25 ... ... ... ... ... ... ... ... 200-300 ... 120-140 ... 15 ... 10-20 700-800 1,060-1,290 220 ... ... ... ... 20 ... ... ... ... ... 1995 ... ... 10 15 65 20 ... ... 188-198 22 30 ... 20 20 ... ... ... ... 250-300 ... 100-125 ... ... ... ... 450 800-875 ... 40 30 30 ... 20 24 20 25 69 10 Destination in 1995 ... ... East East France France ... ... ... US East/West ... Spain ... ... ... ... ... East/West ... East/West ... ... ... ... East/West ... ... East/West US Poland ... Ghana US/Latin America Europe East ... South Korea

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Gotco Egypt Iran Total Greece Egypt Libya Saudi Arabia Iran Total Gulf Interstate Qatar Hachuel Oil Nigeria Hanwha Iran Kuwait Malaysia Oman Saudi Arabia Total Honam Abu Dhabi Iran Malaysia Oman Saudi Arabia Qatar Total Hunt Mexico Saudi Arabia Venezuela Total Hyundai Abu Dhabi Iran Saudi Arabia Total Idemitsu Abu Dhabi Iran Iraq Kuwait Malaysia Oman Qatar Saudi Arabia Vietnam Total Incomed Nigeria 1989 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 50 20 40 30 ... 40 ... ... ... 180 ... 1992 3-4 25 28-29 8 20 50 ... 78 25 ... ... ... ... ... ... ... 20 ... 15 20 30 ... 85 5-10 ... 6 11-16 ... ... ... ... 60 30 ... 20 5 30-40 30 100 7 282-292 ... Volume 1993 ... ... ... ... 20 50 ... 70 ... ... ... ... ... ... ... ... 34 ... 17 22 30 ... 103 8 ... 8 16 ... ... ... ... 60 30 ... 40 5 30-40 30 100 9 304-314 30 1995 ... ... ... ... ... 80 100 180 ... 30 40 20 10-15 20 20 110-115 20 65 12 20 30 10 157 5 12 8 25 10 60 50 120 40 50 ... 50 5 35 30 120 ... 330 30 Destination in 1995 ... ... ... ... ... Greece Greece ... ... East/West South Korea South Korea South Korea South Korea South Korea ... South Korea South Korea South Korea South Korea South Korea South Korea ... US US US ... South Korea South Korea South Korea ... Japan Japan ... Japan Japan Japan Japan Japan ... ... East/West

CRUDE OIL HANDBOOK

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G21

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Indian Oil Corp. Abu Dhabi Iran Iraq Kuwait Malaysia Saudi Arabia Total Indonesia Iran Iraq Saudi Arabia Total Inpex Indonesia Interpetrol Colombia Ecuador Nigeria Total IPCO Nigeria IPG (Kuwait) Yemen Irving Oil Saudi Arabia Isab Garrone Iran Saudi Arabia Syria Total Israel Egypt Mexico Total ITOC Nigeria Itochu Abu Dhabi Ecuador Iran Kuwait Nigeria Oman Qatar Total Ivory Coast Kuwait Jaco Rossi Libya Japan China Mexico Total 1989 10 20 70 10 ... 60 170 30 30 ... 60 ... ... ... ... ... ... ... ... ... 35 ... 35 ... ... ... ... ... 15 40 ... ... ... 30 85 ... ... 165 180 345 1992 20 60 ... 80 30 100 290 ... ... 20 20 ... 17 ... 30 47 ... 10 50 40-50 30-50 ... 70-100 40 30 70 10 10-20 ... 30 ... 30 20 50 140-150 ... 60 190 100 290 Volume 1993 20 60 ... 80 30 100 290 ... ... ... ... 30 ... 12 ... 12 ... ... 50 40-50 30 16-25 86-106 ... ... ... ... 10-20 ... 25 10 30 20 50 145-155 ... ... 180 100 280 1995 20 60 ... 90-100 10 120 300-310 ... ... ... ... ... ... 12 ... 12 20 25 50 35 30 15 80 ... ... ... ... ... ... 30 ... 20 15 50 115 25 ... ... 80 80 Destination in 1995 India India ... India India India ... ... ... ... ... ... ... US/Latin America ... ... East/West East Canada Italy Italy Italy ... ... ... ... ... ... ... Japan ... East/West Japan Japan ... Ivory Coast ... ... Japan ...

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Japan Energy Corp. Kuwait Saudi Arabia Vietnam Total Kanematsu Abu Dhabi Iran Qatar Total Kashima Iraq Oman Total Kitco Indonesia Koch Egypt Mexico Venezuela Total KPI/KPC Saudi Arabia Kukdong Abu Dhabi Iran Oman Saudi Arabia Total Kuo International Vietnam Kuwait Pet. Intl. Kuwait Kyung-In China Iran Kuwait Malaysia Oman Qatar Saudi Arabia Total Kyushu Abu Dhabi Lebanon Syria Lion Oil Saudi Arabia Lucky Goldstar Ecuador 1989 ... 60 ... 60 15 20 15 50 10 10 20 varies ... ... ... ... ... ... ... ... ... ... ... 130 ... ... ... ... ... ... ... ... ... ... ... 25 1992 ... 100 ... 100 17 30 ... 47 ... 12 12 45-50 5-7 10 15 30-32 75 10 25 10 20 65 7 90 ... ... 20 10-15 15-20 8 ... 53-63 ... 40 25 24 Volume 1993 ... 100 8 108 17 20 ... 37 ... 12 12 ... ... 20 15-25 35-45 ... 10 25 ... 45 80 10-20 90 20 20 20 21 32 10 20 143 ... 20 ... 27 1995 10 100 ... 110 17 40 ... 57 ... 10-15 10-15 ... ... 25 10 35 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 15 ... 25 36 Destination in 1995 Japan Japan ... ... Japan Japan ... ... ... Japan ... ... ... US US ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... Japan ... US South Korea

CRUDE OIL HANDBOOK

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PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Lyondell Mexico Nigeria Saudi Arabia Venezuela Total Mapco Nigeria Marathon Iraq Kuwait Mexico Saudi Arabia Total Marc Rich Egypt Iran Nigeria Ecuador Syria Total Marimpex Egypt Iran Libya Total Marubeni Abu Dhabi Iran Malaysia Oman Qatar Vietnam Total Metalchim Nigeria Mindo/Pertamina Saudi Arabia Mitsubishi Corp. Abu Dhabi Iran Iraq Kuwait Malaysia Oman Qatar Saudi Arabia Vietnam Yemen Total Mitsubishi Oil Abu Dhabi Iran Saudi Arabia Total 1989 60 30 50 ... 140 50 35 ... 90 60 185 ... 200 ... ... ... 200 ... ... ... ... ... 20 ... ... 50 ... 70 ... ... ... 20 20 20 ... ... 50 100 ... ... 210 15 10 ... 25 1992 70 ... 50 1 121 ... ... ... 60 125 185 6-9 100-120 40 12 ... 158-181 4 ... 20 24 ... 30 ... 10 50 5 95 20 ... 20 20 ... 20 5-10 17 50 ... 25 ... 157-162 ... 15 50 65 Volume 1993 30 ... ... 100 130 ... ... 0-30 60 125 185-215 ... 150-175 30 12 30-33 222-250 ... ... ... ... ... 25 3 10 50 5 93 20 ... 20 25 ... 20 8 17 50 58 27 ... 225 20 15 20 55 1995 ... ... ... 130 130 ... ... 50 20-25 100 150 ... ... ... ... 3 3 ... ... ... ... 10 30 3 10 45 ... 98 ... 55 30 20 ... ... 8 10 50 60 ... 5 183 20 ... 20 40 Destination in 1995 ... ... ... US ... ... ... US US US ... ... ... ... ... Europe ... ... ... ... ... Japan Japan Japan Japan Japan ... ... ... Indonesia Japan Japan ... ... Japan Japan Japan Japan ... Japan ... Japan ... Japan ...

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Mitsui Abu Dhabi Egypt Iran Kuwait Oman Qatar Vietnam Total Mobil Abu Dhabi Colombia Egypt Iran Malaysia Mexico Oman Qatar Syria Venezuela Yemen Saudi Arabia Total Moncrief Oil Nigeria Motor Oil Hellas Egypt Murphy Colombia Mexico Venezuela Total N. Korea Iran Neste Abu Dhabi Iran Nigeria Oman Saudi Arabia Nigeria Total Nichimen Vietnam Nigermed Nigeria Nippon Oil Abu Dhabi Iran Iraq Malaysia Oman Qatar 1989 10 ... 30 20 ... 20 ... 80 ... ... ... ... ... 90 20 25 ... 40 ... ... 175 ... ... 15 15 ... 30 40 ... ... ... ... 90 ... 90 ... ... 20 ... 35 ... 20 ... 1992 10-15 3 25 ... 12 ... 5 55-60 20 ... 4 40 10-15 100 ... 25 ... 35 22 375-425 631-686 ... 6 17 18 ... 35 10 20 ... 40 20 30 20 130 2 30 40 ... ... 10-15 20 10 Volume 1993 10-15 ... 20 ... 12 ... 5 47-52 20-30 16 ... 25 ... 125 ... 25 ... 30-100 ... 375-425 616-746 ... ... 16 ... ... 16 ... 20 0-40 40 20 ... ... 80-120 ... 30 40 ... ... 15 20 10 1995 ... ... 20-25 ... 10-15 30 ... 60-70 20-30 ... ... 40-50 ... 90 10 25 10 130 ... 300-350 625-695 20 ... ... 15 15 30 ... 20 ... ... ... ... ... 20 ... ... 30 30 ... 15 20 10 Destination in 1995 ... ... Japan ... Japan Japan ... ... East ... ... East ... US East East Europe US ... East/West ... East/West ... ... US US ... ... Kenya ... ... ... ... ... ... ... ... Japan Japan ... Japan Japan Japan

CRUDE OIL HANDBOOK

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PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Nippon Oil (cont.) Saudi Arabia Vietnam Total Nissho Iwai Oman Vietnam Iran Total Nova (Canada) Libya Nigeria Total Nova (Greece) Iran Libya Nigeria Total Nynas Venezuela Nynas Sweden Venezuela Nynas UK Venezuela Oil Tex Ecuador OK Petroleum Iran Nigeria Saudi Arabia Total OMV Egypt Iran Libya Mexico Syria Total Oranto (First Fuels) Nigeria Pakistan Abu Dhabi Iran Kuwait Qatar Saudi Arabia Total Perta Indonesia Petro-Canada Mexico 1989 ... ... 75 ... ... 20 20 ... ... ... ... ... ... ... 30 ... ... ... ... ... ... ... ... ... 20 5 ... 25 ... ... ... ... ... ... ... varies ... 1992 50 5 135-140 ... 25 ... 25 ... 20 20 ... 20-40 ... 20-40 24 ... ... 12 ... 20 ... 20 7-9 30 85-90 25 20 167-174 ... 10 20 ... ... 50 80 45-50 15 Volume 1993 70 ... 155 10 27 ... 37 ... 20 20 60 40 ... 100 25 ... ... 12 ... ... ... ... ... 20-30 90 30 20 160-170 ... 10 40 ... ... 40 90 ... 15 1995 100 ... 205 10 ... ... 10 10 20 30 ... 40 20 60 ... 10 30 24 30 20 50 100 ... 5-10 110 ... 10 125-130 20 10 20 50-70 10 45 135-155 ... 10 Destination in 1995 Japan ... ... Japan ... ... ... Europe East/West ... ... Greece East/West ... ... Sweden UK US/Latin America Sweden Sweden Sweden ... ... Austria Austria ... Austria ... East/West Pakistan Pakistan Pakistan Pakistan Pakistan ... ... Canada

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Petrobras Ecuador Iran Iraq Kuwait Qatar Saudi Arabia Venezuela Total Petrofina Abu Dhabi Iran Kuwait Mexico Saudi Arabia Total Petrogal Iran Mexico Saudi Arabia Total Petrogas (Glencore) Nigeria Petrojam Nigeria Petrolimpex Saudi Arabia Petromed Mexico Nigeria Total Petron Saudi Arabia Petronas Iran Petronor Iran Mexico Total Petroperu Colombia Petrotrin Colombia Venezuela Total Phibro China Colombia Ecuador Egypt Iran Nigeria 1989 15 60 150-200 30 25 120 ... 400-450 ... ... ... 20 ... 20 ... 10 ... 10 ... ... ... 40 70 110 ... ... ... 50 50 ... ... ... ... 40 15 ... ... 175 60 1992 ... 180 ... ... ... 150-200 ... 330-380 20-30 50-100 ... 30 20 120-180 ... 30 ... 30 ... 20 25 20 ... 20 ... 15 ... ... ... ... ... ... ... 25 33 ... 5-7 30-50 ... Volume 1993 12 75 ... ... 25 200 ... 312 20 0-75 ... ... 20 40-105 ... ... ... ... ... 20 ... ... ... ... ... ... ... ... ... 6 ... ... ... ... 16-32 0-12 ... 0-80 30 1995 ... 60 ... 50 20 150 50 330 ... 75 25 14 65 179 30 13 65 108 30 ... ... ... ... ... 150 ... 30-40 ... 30-40 ... 16 15 31 ... 16 ... ... ... ... Destination in 1995 ... Brazil ... Brazil Brazil Brasil Brazil ... ... Belgium Belgium Belgium Belgium ... Portugal Portugal Portugal ... East/West ... ... ... ... ... Philippines ... Spain ... ... ... Trinidad Trinidad ... ... US ... ... ... ...

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PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Phibro (cont.) Saudi Arabia Venezuela Yemen Total Phillips Kuwait Mexico Saudi Arabia Venezuela Total PNOC China Iran Kuwait Malaysia Saudi Arabia Total Poland Iran Iraq Total PTT (Thailand) Iran Malaysia Oman Total Queen Petroleum Nigeria Rafiron Iran Ragma Oil Nigeria RD/Shell Abu Dhabi Iraq Kuwait Libya Malaysia Nigeria Oman Venezuela Vietnam Yemen Iran Saudi Arabia Total Repsol Egypt Iran Iraq Kuwait Libya Mexico 1989 ... ... ... 290 ... ... 50 ... 50 ... ... ... ... ... ... ... 25 25 ... ... ... ... ... ... ... ... 50-100 ... ... ... 50 ... 30 ... 10 70 300 510-560 ... ... 100 ... 60 100 1992 15 1 ... 109-131 ... ... 60 ... 60 5 27 ... 5-10 60 97-102 60-72 ... 60-72 15 15 10 40 ... ... ... 67 ... ... 20 5-10 30 40 23 12 ... 50-70 600 847-872 3 ... ... ... 90 190 Volume 1993 ... 0-75 ... 46-229 0-30 ... 60 ... 60-90 2 20 20 ... 60 102 50 ... 50 ... 5-10 ... 5-10 ... ... ... 67 ... 180 20 ... ... 40 23 ... ... 70 800 1200 ... ... ... 0-30 100 160 1995 ... 45 20 81 17 20 65-75 30 132-142 ... ... ... ... ... ... ... ... ... ... 10 ... 10 20 65 20 20 ... 100-150 ... ... ... 50 15 ... ... 50 550-600 785-885 ... 30-35 ... ... 100 85 Destination in 1995 ... US East ... US US US US ... ... ... ... ... ... ... ... ... ... ... Thailand ... ... East/West Romania East/West East ... East/West ... ... ... East Europe ... ... East/West East/West ... ... Spain ... ... Spain Spain

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Repsol Nigeria Saudi Arabia Syria Total Rheinoil Saudi Arabia Syria Total Romania Egypt Iran Total Ruhr Oel Venezuela S. Korea Mexico Samudra Indonesia San Jose Accord Mexico Venezuela Total Saras Saudi Arabia Kuwait Total Sasol Kuwait Scandinavian Trading Nigeria Scanoil Colombia Seibu Kuwait Shell Canada Mexico Shell US Kuwait Mexico Saudi Arabia Yemen Total Showa Shell Abu Dhabi Iran Iraq Malaysia Total Singapore Petroleum Malaysia 1989 ... ... ... 260 35 ... 35 ... ... ... 150 ... varies 45 45 90 ... ... ... ... ... 15 ... ... ... 65 ... 20 85 10 20 10 ... 40 ... 1992 ... 30-50 ... 313-333 90 ... 90 6 16 22 200 10 15-20 53 53 106 ... ... ... ... ... ... ... ... 100 60-70 50 ... 210-220 20 25 ... ... 45 5-10 Volume 1993 ... 100 ... 360-390 90 6-12 96-102 ... ... ... 200 ... ... 50 50 100 35 30 65 ... ... ... 20 4 0-60 80 50-80 ... 130-220 20 25 ... 3 48 ... 1995 40 100 25 380-385 90 20 110 ... ... ... ... ... ... ... ... ... ... 20 20 30 20 ... 20 3 15 120 30 ... 165 30 30 ... 3 63 ... Destination in 1995 Spain Spain Spain ... Germany Germany ... ... ... ... ... ... ... ... ... ... ... Italy ... South Africa East/West ... Japan Canada US US US ... ... Japan Japan ... Japan ... ...

CRUDE OIL HANDBOOK

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G29

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Sinochem Iran Malaysia Oman Saudi Arabia Vietnam Libya Total Smith & Hollander Venezuela Socap Syria Sonangol (Angola) Egypt Sonatrach Iran South Africa Iran Southern Petroleum Nigeria SRC Kuwait Sri Lanka Iran Ssangyong Ecuador Saudi Arabia Total Star Enterprise Egypt Saudi Arabia Venezuela Total Sudan Libya Sumitomo Iran Kuwait Oman Vietnam Total Sun Colombia Mexico Nigeria Saudi Arabia Venezuela Total Taiyo Malaysia Saudi Arabia Total 1989 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 25 ... 25 ... 550 ... 550 ... 20 20 ... ... 40 ... ... 75 50 20 145 ... ... ... 1992 20 ... ... 25 7 ... 52 6 ... 4 ... ... 40 ... ... ... 200 200 10 550 42 602 25 15-20 20 ... 3 38-43 17 30 60 50 37 194 15-20 ... 15-20 Volume 1993 ... ... ... ... ... ... ... ... ... ... 60 ... 30 ... ... ... 170-300 170-300 ... 550 50-60 600-610 ... 20 ... 10 14 44 16 30 60 50 15-20 171-176 15-20 ... 15-20 1995 ... 20 20 30 ... ... 70 5 3 ... ... 200-250 ... 30 20 ... 350 350 ... 550 40 590 ... 40 ... 10 ... 50 16 15-20 ... 75-80 ... 106-116 20 50-60 70-80 Destination in 1995 ... China China China ... ... ... UK Europe ... ... South Africa ... Singapore Sri Lanka ... South Korea ... ... US US ... ... Japan ... Japan ... ... US US ... US ... ... Japan Japan ...

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CRUDE OIL HANDBOOK

PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Tamoil Libya Tarmac Venezuela Tevier Ecuador Nigeria Total Texaco Abu Dhabi Ecuador Iraq Kuwait Malaysia Nigeria Qatar Saudi Arabia Syria Venezuela Total Thai Oil Abu Dhabi Togo Nigeria Tosco Ecuador Total (France) Abu Dhabi Iraq Libya Mexico Nigeria Qatar Saudi Arabia Syria Iran Total Totisa Ecuador Toyomenka Iran Nigeria Total Transworld Oman Trifinery Venezuela Tripetrol Ecuador Tupras Abu Dhabi Iran 1989 100 ... ... ... ... 10 ... 100-150 ... ... ... ... ... ... ... 110-160 ... ... ... ... varies ... 60 80 ... 50 ... ... 190 ... 40 ... 40 50 ... 15 ... ... 1992 240-280 30 ... ... ... ... ... ... ... 10-15 30 10 80-100 ... 18 148-173 ... ... ... 17 ... ... 25 ... ... 50 20 20 132 ... 50 ... 50 110 9 48 ... ... Volume 1993 250 ... 12 40 52 ... 12 ... ... ... 30 ... 80-100 ... 10 132-152 ... ... ... 17 ... 20 30 ... 20 50 30-33 0-40 167-210 12 50-125 ... 50-125 110 15-20 12 48 60-80 Destination 1995 in 1995 250 Germany, Switzerland, Italy ... 12 ... 12 ... 12 ... 35 ... ... ... 80-100 20 35-40 182-207 16 10 12 ... ... 10 20 40 ... 90 30 10-15 200-205 12 60-70 30 90-100 50 15 36 ... 100 ... US/Latin America ... ... ... US/Latin America ... US ... ... ... East/West Europe US ... Thailand Togo US ... ... France France/UK East/West ... France/South Africa France France ... US/Latin America Japan East/West ... East US US/Latin America ... Turkey

CRUDE OIL HANDBOOK

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PIWs TERM DEALS BY COMPANY (In 1,000 b/d)


Tupras (cont.) Libya Saudi Arabia Syria Total Unocal Yemen Unoven Venezuela US SPR Mexico Veba Nigeria Syria Venezuela Total Vermont (Vitol) Nigeria Vitol Iran Nigeria Total VTT Vulcan Nigeria Wickland Ecuador Wind Pemiy NV Nigeria Wintershall Nigeria Yugoslavia Iran Yukong Abu Dhabi China Ecuador Iran Kuwait Malaysia Oman Qatar Saudi Arabia Total 1989 ... ... ... ... ... ... 45 ... ... ... ... ... 100 ... 100 ... ... ... ... 20 ... ... ... ... ... ... ... ... ... ... 1992 60 160 ... 220 ... 120 ... 30 20 ... 50 ... 50-60 ... 50-60 ... ... ... ... ... 17 20 24 70 20 15-20 ... 10 50-100 226-281 Volume 1993 48 160-180 ... 316-356 ... 120 ... 30 30-33 ... 60-63 ... ... ... ... ... ... ... ... ... 35 10 24 70 60 32 29 10 80 350 1995 50 176 20 346 20 135 ... ... 35 40 75 20 ... 30 30 30 12 30 30 ... 20 ... 24 70 70 17 20 10 80 311 Destination in 1995 Turkey Turkey Turkey ... East US ... ... Germany Germany ... East/West ... East/West ... East/West US/Latin America East/West Germany ... South Korea ... South Korea South Korea South Korea South Korea South Korea South Korea South Korea ...

CRUDE OIL HANDBOOK

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G33

US CRUDE OIL IMPORTS BY COMPANY AND COUNTRY OF ORIGIN, 1991-95 (In 1,000 b/d)
Company/Origin 1991 Amerada Hess Abu Dhabi Algeria Angola Argentina Colombia Congo Gabon Indonesia Kuwait Nigeria Norway Saudi Arabia United Kingdom Zaire Total ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 1992 89 ... 13 1 ... 35 14 2 ... 35 ... 47 ... 1 236 ... ... ... ... 2 137 ... ... ... 1 5 ... 3 ... 75 56 1 ... ... 137 ... 69 ... 29 ... 515 ... ... 30 ... ... ... ... 8 1993 74 ... 9 ... ... 24 9 ... 5 71 3 28 1 ... 225 ... ... ... 3 ... 139 8 ... ... ... 6 ... 11 ... 71 82 ... ... ... 114 10 54 1 33 1 533 ... 5 43 ... 3 35 ... 4 1994 10 5 10 ... ... 26 23 3 0.1 115 11 59 38 1 301 ... 1 8 3 ... 143 14 ... 6 ... 5 5 ... ... 68 32 8 ... 2 110 1 61 7 31 8 512 ... ... 60 ... ... 47 ... 1 1995 ... 17 7 4 3 6 19 ... ... 145 3 81 15 2 301 3 2 1 ... ... 169 38 ... ... 1 9 ... ... ... 70 44 6 2 3 61 ... 66 18 43 ... 536 2 ... 97 5 ... 46 13 ... Ashland (cont.) 1991 Norway ... Oman ... Russia ... Saudi Arabia 142 United Kingdom 4 Yemen ... Total 187 Astra Canada Malaysia Thailand UAE Total ... ... ... ... ... 1992 7 ... ... 138 ... ... 183 1 ... ... ... 1 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 56 1 ... 16 8 ... 8 1 ... ... ... 184 21 ... ... 3 1 ... 1993 3 3 ... 80 20 ... 197 1 4 2 1 7 2 5 ... 7 ... 26 ... 3 56 12 111 3 ... ... 6 1 ... ... 10 53 ... ... 9 28 2 2 2 2 ... 1 211 9 2 ... 1 ... ... 1994 1 1 1 82 15 1 210 ... ... ... ... ... ... 5 4 22 ... 43 ... 8 101 13 197 11 ... 2 28 ... ... 10 50 37 ... ... 14 15 ... 30 ... ... 2 ... 153 14 ... 2 ... 5 10 1995 ... 3 ... 57 11 ... 233 ... ... ... ... ... 5 21 ... 28 8 40 4 1 115 22 245 16 2 ... 25 2 4 5 54 24 ... ... 15 19 ... 59 ... ... ... ... 198 5 ... ... ... 6 4

Amoco Algeria ... Angola 3 Argentina ... Australia ... Cameroon 2 Canada 118 Colombia ... Congo 2 Ecuador ... Gabon ... Guatemala 3 Indonesia ... Kuwait 3 Malaysia 1 Mexico 64 Nigeria 55 Norway 10 Peru ... Russia ... Saudi Arabia 117 Syria ... Trinidad & Tobago 70 United Kingdom 1 Venezuela 18 Yemen ... Total 467 Arco Ecuador Ashland Angola Canada Colombia Dubai Kuwait Mexico Nigeria
*Also see Tosco.

Bayway Refining (Tosco)* Algeria ... Angola ... Canada ... China ... Colombia ... Gabon ... Mexico ... Nigeria ... Norway ... United Kingdom ... Total ... BHP Australia ... China ... Ecuador ... Indonesia ... Malaysia ... Oman ... Papua New Guinea ... Total ... British Petroleum Angola 32 Argentina ... Australia 1 Canada 16 Colombia 6 Ecuador ... Gabon 1 Indonesia 2 Malaysia ... Mexico ... New Zealand ... Nigeria 184 Norway 12 Papua New Guinea ... Saudi Arabia ... Thailand 2 United Kingdom ... Venezuela ...

... ... 41 ... ... ... ... ...

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CRUDE OIL HANDBOOK

US CRUDE OIL IMPORTS BY COMPANY AND COUNTRY OF ORIGIN, 1991-95 (In 1,000 b/d)
BP (cont.) Yemen Zaire Total Caribbean Gulf Colombia Ecuador Venezuela Total Cenex Canada 1991 2 3 261 ... ... ... ... ... 1992 ... 3 302 2 1 28 31 18 68 2 1 1 11 ... 13 7 3 18 43 ... 17 3 131 81 ... 4 ... 172 ... ... ... 7 24 ... ... 4 609 ... 4 4 ... ... ... 1 60 ... ... ... 1993 2 5 331 1 3 30 33 22 68 ... 1 ... 17 3 4 1 7 18 34 ... 60 2 126 128 ... 6 1 160 1 1 ... ... 20 ... ... 9 668 1 2 3 ... ... ... ... 66 ... ... ... 1994 ... 4 285 ... ... 34 34 25 50 2 ... ... 22 1 3 26 2 10 46 ... 52 ... 155 61 1 19 ... 155 ... 1 2 13 13 ... 4 6 643 ... ... ... 2 ... ... 1 55 ... ... ... 1995 ... 4 333 ... ... 8 8 30 ... 1 ... ... 22 1 ... 7 7 ... 37 ... 30 2 135 1 13 5 ... 176 ... ... ... 4 24 1 ... ... 465 ... ... ... ... 2 1 ... 31 1 1 1 Citgo (cont.) 1991 1992 4 294 359 1 ... 2 3 1 ... 56 ... ... 2 ... ... ... ... 30 ... 7 1 ... ... 1 ... 6 ... ... ... 107 61 1 ... 1 8 1 6 ... 29 1 ... 29 ... ... ... 11 1 ... 33 ... 2 182 1993 14 309 389 ... 1 ... 1 ... ... 52 ... ... 2 1 3 ... 1 32 5 3 3 ... ... ... ... ... ... ... ... 102 73 ... ... ... 5 2 2 2 29 ... ... 36 ... 4 ... 1 ... ... 30 ... 2 187 1994 10 307 375 ... ... ... ... ... ... 49 1 1 1 ... ... 2 ... 25 18 ... 1 ... ... ... ... 4 9 ... ... 112 44 ... ... ... ... 1 ... 2 36 6 2 31 25 ... 3 ... ... ... 42 ... 3 193 1995 17 348 404 ... ... ... ... 21 1 36 4 1 14 ... 15 ... ... 45 22 8 3 ... ... ... 0 19 22 ... 2 215 52 ... ... 2 ... 3 ... ... 53 ... ... 43 26 2 ... ... ... 7 51 ... 1 240 United Kingdom 3 Venezuela 152 Total 203 Clarendon Argentina Ecuador Indonesia Total Clark Angola Argentina Canada Colombia Congo Ecuador Egypt Gabon Indonesia Kuwait Mexico Nigeria Norway Russia Saudi Arabia Syria Trinidad & Tobago UAE United Kingdom Venezuela Yemen Zaire Total ... ... ... ... ... ... 52 ... ... ... ... ... ... ... 34 ... 2 2 1 1 1 ... 8 1 3 ... 99

Chevron Angola 67 Argentina ... Australia ... Canada 1 China 3 Colombia ... Congo 1 Ecuador ... Egypt ... Gabon 1 Indonesia 46 Italy 3 Kuwait ... Malaysia ... Mexico 131 Nigeria 89 Norway ... Oman 2 Russia ... Saudi Arabia 214 Singapore ... Syria ... UAE ... United Kingdom 11 Venezuela 10 Vietnam ... Yemen ... Zaire 18 Total 597 Cibro Kuwait Venezuela Total Citgo Argentina Angola Colombia Ecuador Mexico Nigeria Norway Peru ... ... ... ... ... ... 1 47 ... ... ...

Coastal Angola 23 Argentina ... Australia 1 Canada ... China 19 Colombia ... Ecuador 8 Egypt ... Gabon 39 Indonesia 10 Malaysia 4 Mexico 34 Nigeria ... Norway ... Russia ... Saudi Arabia ... Trinidad & Tobago ... United Kingdom ... Venezuela 22 Yemen 3 Zaire 1 Total 163

CRUDE OIL HANDBOOK

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G35

US CRUDE OIL IMPORTS BY COMPANY AND COUNTRY OF ORIGIN, 1991-95 (In 1,000 b/d)
Colorado Canada ... ... ... 37 8 1 ... 36 ... ... ... ... ... ... 67 149 ... 20 1 ... ... 1 ... ... 1 6 ... ... ... 2 18 ... 4 52 ... ... 45 7 1 1 54 2 ... 1 2 1 3 44 161 1 16 1 1 2 2 6 ... 2 4 3 ... ... ... 23 ... ... 60 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 2 3 53 ... 2 ... 82 ... ... ... ... 1 ... 44 184 2 15 1 ... ... ... ... 0.2 2 7 3 2 ... ... 18 1 ... 50 6 ... ... ... 0.4 13 2 28 1 33 1 27 ... 1 4 ... 115.6 0.1 ... 60 3 4 ... 72 ... 13 ... ... ... 0.3 41 193 ... 11 5 ... ... ... 2 ... 9 10 ... ... ... ... 22 ... 3 62 3 2 3 2 ... ... ... 129 ... 6 ... 5 1 ... ... 1 151.3 D. Shamrock 1991 1992 ... ... ... ... ... ... 1 ... ... 25 26 3 1 ... ... 4 12 12 3 ... ... 4 15 24 1 3 ... ... ... 24 ... 2 17 27 15 49 ... ... 188 ... ... 1 13 ... ... 397 ... ... 1993 ... ... ... ... ... ... 13 ... 1 29 43 3 ... 1 1 6 21 8 4 ... ... ... 16 1 14 ... 4 ... 15 26 ... ... 104 43 3 11 2 5 94 1 ... 3 3 1 ... 360 1 2 1994 ... 1 ... 0.2 1 8 3 0.2 ... 51 63 ... ... ... ... ... 21 13 10 ... 1 ... 21 ... 44 ... ... 1 3 14 ... 1 102 56 ... 4 4 7 117 ... 3 15 4 1 ... 422 1 ... 1995 1 ... 3 ... ... 1 42 ... ... 24 72 ... ... ... ... ... 19 20 27 ... 2 ... 25 ... 58 12 ... 2 ... 18 ... ... 69 99 ... 2 ... 2 145 ... ... 11 3 ... 2 495 3 ... Angola 4 Canada ... Colombia ... Indonesia ... Malaysia ... Nigeria ... Norway 13 Papua New Guinea ... Thailand ... United Kingdom 2 Total 18 Enron Canada Ecuador Mexico United Kingdom Total Ergon Venezuela ... ... ... ... ... ...

Conoco Angola ... Canada 42 Colombia 1 Ecuador ... Egypt ... Mexico 31 Nigeria 7 Peru ... Saudi Arabia ... Syria ... Trinidad & Tobago ... United Kingdom ... Venezuela 76 Total 157 Crown Algeria 1 Angola 18 Argentina ... Australia ... Benin ... Canada ... Colombia 2 Malaysia ... Nigeria 6 Norway 5 Oman ... Papua New Guinea ... Syria 1 Tunisia ... United Kingdom 17 Yemen ... Zaire ... Total 50

Deer Park Refining Partnership* Algeria ... ... Cameroon ... ... Colombia ... ... Ecuador ... ... Indonesia ... ... Kuwait ... ... Malaysia ... ... Mexico ... ... New Zealand ... ... Nigeria ... ... Norway ... ... Saudi Arabia ... ... Spain ... ... UAE ... ... United Kingdom ... ... Venezeula ... ... Total ... ...
*Shell Oil and Pemex.

Exxon Angola 33 Argentina 1 Australia 2 Benin ... Cameroon 1 Canada 19 China 7 Colombia 5 Congo ... Dubai ... Ecuador ... Egypt ... Gabon 10 Guatemala 1 Indonesia 1 Kuwait ... Mexico 33 Nigeria ... Norway 3 Oman ... Russia ... Saudi Arabia 237 Syria ... UAE ... United Kingdom ... Venezuela 18 Yemen ... Zaire 1 Total 373 Farmland Congo Fina Angola ... ...

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CRUDE OIL HANDBOOK

US CRUDE OIL IMPORTS BY COMPANY AND COUNTRY OF ORIGIN, 1991-95 (In 1,000 b/d)
Fina (cont.) Argentina Australia Colombia Ecuador Egypt Indonesia Kuwait Mexico Nigeria Norway Oman Russia Saudi Arabia United Kingdom Yemen Total Frontier Canada Golden West Ecuador Hunt Ecuador Mexico Saudi Arabia Venezuela Total Indian Refining Angola Canada Ecuador Nigeria Norway Russia United Kingdom Total Kerr-McGee Abu Dhabi Algeria Angola Argentina Australia Colombia Denmark Indonesia New Zealand Nigeria Norway Thailand United Kingdom Zaire Total 1991 ... ... 3 4 ... ... 1 21 ... ... 2 ... 44 11 3 89 ... ... ... 6 4 7 17 ... ... ... ... ... ... ... ... ... 1 18 ... ... 21 ... ... ... 1 ... ... 20 ... 61 1992 1 2 6 ... ... 3 1 24 8 1 ... 1 19 16 ... 83 ... 1 ... 8 7 7 22 ... ... ... ... ... ... ... ... ... 1 23 2 ... 3 ... 2 ... 1 3 1 14 2 53 ... ... 1993 ... ... 4 ... 3 ... 23 38 10 1 ... 3 ... 14 ... 99 ... ... ... 9 8 8 24 5 ... 7 ... ... ... ... 12 1 4 16 ... 1 3 1 ... 1 4 ... 1 12 ... 44 ... ... 1994 1 ... 1 ... ... ... 25 34 5 ... ... ... ... 45 ... 112 ... ... ... 7 8 7 22 ... 14 2 10 3 3 1 32 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 1995 ... ... 5 ... ... ... 18 45 ... 3 ... ... ... 52 ... 122 0.3 ... 1 8 3 10 22 ... 3 ... ... ... ... ... 3 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 3 1 Int. Term (cont.) 1991 Saudi Arabia UAE Total ... ... ... 1992 ... ... ... 1993 ... ... ... ... 4 ... ... ... 175 3 ... ... ... ... 27 3 ... 2 ... ... 3 ... 22 18 ... ... 257 ... ... ... ... ... ... ... ... 26 ... ... 10 ... ... ... 1 ... ... ... 11 3 ... 1994 ... ... ... ... 4 ... ... 2 167 13 2 ... 0.4 ... 35 37 6 2 ... ... ... 2 17 10 7 ... 303 ... 1 1 ... 1 0.3 3 ... 33 ... 1 5 ... ... ... ... 3 ... ... 9 4 ... 1995 1 1 6 ... 11 1 1 ... 191 8 2 3 1 2 28 45 7 ... 1 ... ... 1 32 10 3 1 346 1 ... ... 1 4 ... 7 ... 31 1 ... 3 1 1 2 ... ... 1 3 12 3 ...

Koch Algeria 1 ... Angola ... 9 Argentina 1 ... Bolivia ... ... Cameroon ... ... Canada 158 151 Colombia ... 1 Dubai ... ... Ecuador ... ... Indonesia 1 ... Malaysia ... ... Mexico 8 18 Nigeria 7 ... Norway ... ... Papua New Guinea ... ... Singapore ... ... Saudi Arabia 3 ... Syria ... ... Thailand ... ... United Kingdom 1 22 Venezuela 7 13 Yemen ... ... Zaire ... ... Total 188 214 La Gloria Angola ... ... Colombia ... ... Malaysia ... ... Nigeria ... ... United Kingdom ... ... Yemen ... ... Total ... ... Laketon Refining Canada ... 4 Lion Saudi Arabia ... 23 Louisiana Land & Exploration Angola ... ... Brazil ... ... Canada ... 5 Chile ... ... Colombia ... ... Ecuador ... ... Indonesia ... ... Nigeria ... ... UAE ... ... United Kingdom ... ... Total ... 5 Lyondell Angola Argentina 6 ... 12 5

Intercontinental Term Algeria ... Nigeria ...

CRUDE OIL HANDBOOK

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US CRUDE OIL IMPORTS BY COMPANY AND COUNTRY OF ORIGIN, 1991-95 (In 1,000 b/d)
Lyondell (cont.) 1991 Colombia 1 Ecuador 5 Indonesia ... Mexico 82 Nigeria 1 Russia ... Saudi Arabia 62 Thailand ... United Kingdom 2 Venezuela 7 Zaire ... Total 166 Marathon Angola ... Argentina ... Canada 14 Colombia ... Congo ... Egypt ... Kuwait ... Mexico 57 Nigeria 3 Norway 1 Peru ... Russia ... Saudi Arabia 141 United Kingdom 2 Venezuela ... Total 218 Metallgesellschaft Angola ... Canada 1 Colombia 1 Ecuador ... Nigeria ... United Kingdom 3 Total 4 Mobil Angola 3 Benin 4 Canada 103 Colombia 22 Ecuador 15 Egypt ... Gabon 2 Guatemala 1 Kuwait 1 Mexico 104 Nigeria ... Norway 4 Peru 1 Russia ... Saudi Arabia 59
*See BHP for 1994-95.

1992 ... ... ... 53 ... 1 41 ... 3 29 ... 144 ... 1 18 3 ... 4 1 60 ... 9 ... ... 137 10 ... 243 1 1 1 ... 5 3 10 3 1 116 16 10 3 1 ... ... 131 8 ... ... 2 53

1993 6 2 ... 31 ... ... ... ... ... 134 1 176 5 ... 15 ... 7 4 50 47 3 7 ... 6 110 26 ... 281 ... ... ... 7 ... ... 7 ... ... 143 ... 1 9 3 ... 1 155 31 ... ... 7 41

1994 20 ... 1 4 1 ... ... 1 1 119 ... 151 23 ... 20 ... 1 ... 51 30 3 ... ... 7 91 31 12 267 ... ... ... ... ... ... ... ... ... 175 ... 7 17 1 ... ... 170 19 ... ... 3 59

1995 4 3 ... ... 7 ... ... ... 11 161 ... 189 16 ... 22 5 3 ... 56 24 10 ... 1 5 111 5 9 266 ... ... ... ... ... ... ... 2 ... 174 3 11 13 1 ... ... 224 39 1 1 ... 90

Mobil (cont.)

1991

1992 3 59 ... 407 5 4 5 6 15 ... 1 2 3 ... 1 7 ... 45 ... 2 1 ... ... ... ... ... ... ... 1 ... ... ... 1 2 5 9 2 2 15 5 ... ... 37

1993 ... 118 ... 510 5 7 3 7 12 ... 5 4 1 ... ... 8 ... 47 ... 3 ... ... ... ... ... ... ... ... ... 2 3 ... ... 6 4 2 2 ... 18 ... 1 2 29

1994 ... 121 ... 572 4 7 ... 15 13 ... 18 ... ... ... ... 6 14 72 ... ... ... 1 1 ... 1 3 12 18 ... ... ... 1 ... 1 ... ... ... ... ... ... ... ... ...

1995 3 119 ... 679 6 13 ... 33 14 4 21 2 ... 2 ... ... 35 124 22 ... ... 7 6 3 ... ... 16 31 ... 0.3 ... ... ... 0.3 ... ... ... ... ... ... ... ... ...

United Kingdom 1 Venezuela 37 Zaire 1 Total 356 Montana Refining Canada Murphy Angola Argentina Canada Colombia Ecuador Mexico Nigeria Norway Oman Saudi Arabia United Kingdom Venezuela Total Neste Venezuela North Ridge Canada Northeast Petro United Kingdom ... 1 ... 6 21 ... 18 2 ... ... ... 1 ... 50 ... ... ...

Oiltanking Houston Colombia ... Ecuador ... Kuwait ... Saudi Arabia ... United Kingdom ... Venezuela ... Total ... Pacific Refining Australia Canada Colombia Indonesia Malaysia Total ... ... ... ... ... ...

Pacific Resources* Australia 12 China 2 Ecuador 2 Guinea ... Indonesia 19 Malaysia 10 Oman ... Papua New Guinea ... Total 46

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CRUDE OIL HANDBOOK

US CRUDE OIL IMPORTS BY COMPANY AND COUNTRY OF ORIGIN, 1991-95 (In 1,000 b/d)
Peerless Algeria 1991 ... 1992 3 47 ... ... ... ... ... 10 29 1 1 2 41 3 ... ... 4 ... ... 1 ... 12 ... ... ... ... 25 2 178 4 1 ... 26 ... ... ... 22 ... ... 64 7 ... ... ... 125 ... 3 22 12 7 1993 1 40 ... 2 1 2 ... ... 33 9 2 1 43 3 ... ... 3 ... 5 ... 8 1 ... ... 4 ... 40 2 199 1 2 5 29 1 19 ... 25 4 ... 52 7 ... 3 ... 148 ... ... 16 ... 4 1994 ... 45 2 ... ... ... 1 1 9 1 3 ... 55 1 ... 2 2 5 ... ... 1 ... ... 0.3 ... 1 34 ... 164 4 5 ... 21 ... 15 21 32 11 1 70 3 25 ... ... 207 15 ... 10 5 2 1995 ... 53 1 ... ... ... ... ... 9 4 4 1 50 ... ... 4 ... 2 ... ... 1 ... ... ... ... ... 59 2 190 6 ... ... ... ... 2 9 56 20 ... 75 14 40 ... ... 220 14 ... 16 ... 2 Shell (cont.) 1991 1992 2 14 ... ... ... ... ... ... 82 ... 142 ... ... ... 48 ... ... ... 4 ... ... 333 ... ... ... ... 2 ... ... ... ... ... ... ... ... ... ... 21 ... ... ... ... ... 496 ... 52 569 1993 ... 48 ... ... ... 1 35 1 110 1 105 ... 6 ... 51 ... 1 ... 16 ... ... 393 ... ... ... ... 2 ... ... ... ... ... ... ... ... ... ... 21 ... 1 3 ... ... 493 1 50 569 3 1 3 1994 2 53 ... ... 2 ... ... 2 91 ... 63 1 1 4 3 ... 2 2 6 ... ... 247 12 4 16 0.1 3 3 3 19 7 13 6 3 10 60 2 25 3 3 4 ... 1 463 4 42 547 ... ... ... 1995 ... 70 1 ... ... ... ... ... 80 ... 39 ... ... ... 15 0.4 ... 1 ... ... ... 224 12 3 15 ... 2 2 ... 16 8 5 ... ... 7 36 2 13 5 6 22 3 ... 514 ... 49 614 ... ... ... Cameroon 6 Canada 2 China ... Colombia 1 Ecuador 4 Indonesia 1 Kuwait ... Malaysia 2 Mexico 72 New Zealand ... Nigeria 117 Norway ... Oman ... Papua New Guinea ... Saudi Arabia 59 Spain ... Thailand ... UAE ... United Kingdom ... Venezuela 1 Yemen 5 Total 318 Sinclair Canada Venezuela Total Sound Refining Indonesia Venezuela Total ... ... ... ... ... ...

Phibro Angola 32 Argentina 1 Australia 1 Benin ... Cameroon ... Canada ... China 34 Colombia 32 Congo 5 Ecuador ... Egypt ... Gabon 32 Indonesia 5 Malaysia 3 Mexico ... Nigeria 7 Norway ... Papua New Guinea ... Peru ... Russia 1 Saudi Arabia 15 Syria 3 Trinidad & Tobago 1 UAE ... United Kingdom ... Venezuela 7 Zaire 1 Total 180 Phillips Angola 9 Argentina ... Cameroon ... Congo 22 Egypt ... Kuwait ... Mexico ... Nigeria 17 Norway 23 Oman ... Saudi Arabia 41 United Kingdom 4 Venezuela ... Yemen ... Zaire 1 Total 117 Powerine Ecuador Seaview Venezuela Shell Algeria Angola Australia ... ... 38 5 3

Southwestern Refining Algeria ... Angola ... Colombia ... Nigeria ... Norway ... Thailand ... United Kingdom ... Total ... Star Enterprise Ecuador ... Egypt 17 Gabon ... Kuwait ... Mexico ... Nigeria ... Oman ... Saudi Arabia 520 United Kingdom ... Venezuela 36 Total 573

Strategic Petroleum Reserve Angola ... ... Argentina ... ... Norway ... 6

CRUDE OIL HANDBOOK

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G39

US CRUDE OIL IMPORTS BY COMPANY AND COUNTRY OF ORIGIN, 1991-95 (In 1,000 b/d)
SPR (cont.) 1991 1992 4 10 ... 63 32 ... 14 3 31 128 6 ... 53 41 19 ... ... 390 1 ... 8 2 ... ... ... ... 1 ... ... ... 12 23 1 ... 1 1 ... ... ... ... 16 ... ... ... ... 17 1993 8 15 5 57 22 ... 20 ... 26 92 ... 1 44 91 16 ... ... 376 ... ... 15 ... 4 3 ... ... ... ... ... ... 12 35 ... ... ... ... ... ... ... ... 9 ... ... 8 ... 18 1994 12 12 42 54 17 2 6 3 31 95 18 1 78 115 ... ... 2 464 ... 1 15 1 1 8 1 ... ... ... ... 11 16 55 ... ... ... 2 ... 4 1 1 3 0.4 ... 14 1 27 1995 ... ... 105 68 12 ... 16 5 15 146 45 ... 86 94 15 2 1 610 ... ... 22 2 4 10 3 2 ... 5 ... ... 18 65 ... ... ... 6 4 4 ... 1 7 ... ... 5 ... 27 Total Canada Colombia Ecuador Saudi Arabia Total Trifinery Venezuela Tx Petrochem Saudi Arabia Ultramar Mexico United Refining Canada Unoven Canada Venezuela Total Unocal Australia Canada Indonesia Malaysia Mexico Philippines Thailand Total US Oil & Refining Canada Thailand Venezuela Total Valero Angola Argentina China Gabon Indonesia Nigeria Total Wickland Ecuador Argentina Total 1991 ... ... ... ... ... ... ... ... ... ... ... ... 1 ... 8 2 ... ... 1 11 ... ... ... ... ... ... ... ... ... ... ... ... ... ... 1992 9 ... ... ... 9 12 ... 1 60 17 121 138 ... 1 ... ... ... 1 ... 2 3 ... 1 4 1 ... 21 ... ... ... 22 5 ... 5 ... 6,399 1993 11 1 ... ... 12 16 ... ... 60 13 121 134 ... ... ... ... 2 ... ... 2 3 ... ... 3 9 ... 18 ... ... ... 27 21 ... 21 ... 7,043 1994 11 ... 5 1 17 19 1 ... 61 3 118 120 ... ... ... ... ... ... 1 1 3 0.2 ... 3 4 ... 17 ... ... ... 21 ... 0.2 0.2 ... 7,469 1995 7 3 6 ... 17 ... ... ... 68 17 131 148 ... ... ... ... ... ... ... ... 3 ... ... 3 15 2 2 1 1 1 22 ... ... ... 0.2 8,217 United Kingdom ... Total ... Sun Angola ... Canada 52 Colombia 7 Denmark ... Ecuador ... Gabon ... Mexico 20 Nigeria 187 Norway ... Oman ... Saudi Arabia 44 United Kingdom 14 Venezuela 13 Yemen ... Zaire ... Total 336 Tesoro Australia ... Texaco Argentina Canada China Colombia Ecuador Indonesia Kuwait Malaysia Peru Saudi Arabia United Kingdom Venezuela Total Thrifty Ecuador Malaysia Total Tosco* Argentina Canada Chile China Colombia Ecuador Indonesia Mexico Oman Venezuela Total ... 1 ... ... 1 ... ... ... ... 1 ... 14 17 4 1 5 ... 8 ... ... ... 2 ... 1 ... ... 10

Wyoming Refining Canada ... Grand Total 5,338

Note: May not add due to rounding.

*See also Bayway Refining.

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CRUDE OIL HANDBOOK

US CRUDE OIL IMPORTS BY COUNTRY OF ORIGIN AND COMPANY, 1991-95 (In 1,000 b/d)
Origin/Company 1991 Abu Dhabi Amerada Hess Kerr-McGee Total Algeria Amerada Hess Amoco Bayway Ref.* Crown Deer Park Ref. Intercont. Term Kerr-McGee Koch Peerless Shell SW Refining Total ... ... ... ... ... ... 1 ... ... 1 1 ... 38 ... 41 1992 89 ... 89 ... ... ... ... ... ... 1 ... 3 22 ... 26 13 ... ... ... 56 68 ... 1 61 ... 20 ... 12 ... ... 23 9 ... ... 12 ... 1 3 4 47 4 12 ... ... ... 1 347 1 ... 1993 74 1 75 ... ... 2 1 ... ... 4 ... 1 16 ... 24 9 ... 5 5 53 68 ... ... 73 ... 16 ... 8 2 5 16 4 ... ... 3 5 ... ... 7 40 1 ... ... 3 5 9 337 ... ... 1994 10 ... 10 5 ... ... 2 6 ... ... ... ... 10 3 26 10 1 ... 5 37 50 ... ... 44 3 15 ... 13 ... ... ... 4 ... ... 4 23 ... ... 7 45 4 5 19 ... 42 4 335 ... 8 1995 ... ... ... 17 3 5 ... 3 3 ... ... ... 16 ... 47 7 2 ... 21 24 ... 2 21 52 ... 11 1 20 ... ... ... 11 1 1 3 16 ... 2 13 53 6 ... 16 ... 105 15 403 4 1 Argentina (cont.)1991 British Petroleum Chevron Citgo Clarendon Clark Coastal Crown Exxon Fina Kerr-McGee Koch Lyondell Marathon Murphy Phibro Phillips Strategic Pet. Res. Texaco Tosco Valero Wickland Total Australia Amoco BHP British Petroleum Chevron Coastal Crown Exxon Fina Kerr-McGee Pacific Refining Pacific Res. Phibro Shell Tesoro Unocal Total Benin Crown Exxon Mobil Phibro Total Bolivia Koch Brazil LL&E Cameroon Amoco Deer Park Ref. ... ... ... ... ... ... ... 1 ... ... 1 ... ... ... 1 ... ... ... ... ... ... 3 ... ... 1 ... 1 ... 2 ... ... ... 12 1 3 ... 1 21 ... ... 4 ... 4 ... ... 2 ... 1992 1 2 ... 1 ... 1 1 3 1 2 ... 5 1 5 ... 1 ... ... 1 ... ... 26 ... ... ... 1 ... ... ... 2 ... 1 5 ... 7 1 ... 17 ... ... 1 ... 1 ... ... 2 ... 1993 ... ... ... ... ... ... 1 4 ... ... ... ... ... 3 ... 2 1 ... ... ... ... 11 3 3 ... 1 ... 1 ... ... 1 ... 4 2 4 ... ... 19 2 ... ... 1 3 ... ... ... ... 1994 ... 2 2 ... ... ... 1 10 1 ... ... ... ... ... 2 5 ... 1 2 ... 0.2 34 3 11 ... ... ... ... ... ... ... ... ... ... 2 ... ... 16 ... 1 ... ... 1 ... 1 ... ... 1995 ... 1 ... ... 1 ... 5 27 ... ... 1 ... ... ... 1 ... ... ... 6 2 ... 49 ... 16 ... ... ... ... ... ... ... ... ... ... 2 ... ... 18 ... 2 ... ... 2 1 ... ... 2

Angola Amerada Hess ... Amoco 3 Ashland ... Bayway Ref.* ... British Petroleum 32 Chevron 67 Citgo ... Clark ... Coastal 23 Conoco ... Crown 18 D. Shamrock 4 Exxon 33 Fina ... Indian Refining ... Kerr-McGee 18 Koch ... La Gloria ... LL&E ... Lyondell 6 Marathon ... Metallgesellschaft ... Mobil 3 Murphy 1 Phibro 32 Phillips 9 Shell 5 SW Refining ... Strategic Pet. Res. ... Sun ... Valero ... Total 254 Argentina Amerada Hess Amoco
*See also Tosco.

... ...

See also Bayway Refining. Joint venture between Shell and Pemex. Formerly Pacific Resources. Now BHP.

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US CRUDE OIL IMPORTS BY COUNTRY OF ORIGIN AND COMPANY, 1991-95 (In 1,000 b/d)
Cameroon (cont.) 1991 Exxon Koch Phibro Phillips Shell Total 1 ... ... ... 6 9 1992 4 ... ... ... 2 8 137 30 1 ... 16 18 1 56 1 ... 37 1 ... 3 15 ... ... 151 4 5 18 1 116 5 6 2 ... ... 14 ... 63 8 ... 9 60 1 17 3 ... 799 ... ... ... ... 1993 ... ... 2 5 ... 7 139 43 1 ... 9 22 ... 52 ... ... 45 2 ... 3 16 ... ... 175 ... 10 15 ... 143 5 7 3 2 ... 48 ... 57 15 ... 11 60 ... 13 3 ... 899 ... ... ... 7 1994 ... 2 ... ... 2 4 143 60 ... 4 14 25 ... 49 ... 2 53 ... 1 ... 21 ... 14 167 ... 5 20 ... 175 4 15 ... ... 1 53 12 54 15 ... 11 61 ... 3 3 ... 985 ... 4 4 22 1995 ... ... ... ... ... 2 169 97 ... ... 15 30 ... 36 2 0.1 60 ... ... ... 25 0.3 3 191 ... 3 22 ... 174 6 33 ... 0.3 ... 70 12 68 22 4 7 68 ... 17 3 0.2 1,137 1 4 5 28 China (cont.) BHP Chevron Coastal Exxon Pacific Res. Phibro Shell Texaco Tosco Valero Total 1991 ... 3 19 7 2 34 ... ... ... ... 65 1992 ... 11 8 24 9 10 ... 2 ... 21 85 ... ... ... ... 8 2 ... ... ... 1 8 ... ... ... 1 6 3 1 ... ... ... 3 1 16 15 ... ... 29 ... ... 32 ... ... ... 126 35 ... 13 ... 3 1993 ... 17 5 1 2 ... ... ... ... 18 50 ... 8 ... ... 28 1 3 ... ... 2 7 6 ... ... 14 4 3 3 ... ... 6 ... ... ... 12 ... 3 33 ... ... 22 4 ... 1 160 24 ... 4 ... ... 1994 ... 22 ... ... ... 1 ... 1 1 17 64 ... 14 ... ... 15 ... 1 ... 1 1 ... ... ... ... 44 1 ... 13 1 ... 20 ... ... ... 13 1 ... 9 ... 7 17 1 1 ... 160 26 ... 3 1 ... 1995 2 22 ... ... ... ... 1 2 ... 2 57 3 38 5 8 19 ... 1 1 4 3 3 2 3 3 58 5 ... 8 ... 1 4 5 ... 3 14 7 ... 9 ... 8 12 4 1 3 235 6 ... ... 1 12

Canada Amoco 118 Ashland 41 Astra ... Bayway Ref.* ... British Petroleum 16 Cenex ... Chevron 1 Clark 52 Coastal ... Colorado ... Conoco 42 Crown ... D. Shamrock ... Enron ... Exxon 19 Frontier ... Indian Refining ... Koch 158 Laketon Refining ... LL&E ... Marathon 14 Metallgesellschaft 1 Mobil 103 Montana Refining ... Murphy 6 North Ridge ... Pacific Refining ... Phibro ... Shell 2 Sinclair ... Sun 52 Texaco 1 8 Tosco Total (France) ... United Refining ... Unocal ... Unoven ... US Oil & Refining ... Wyoming Refining ... Total 634 Chile LL&E Tosco Total China Bayway Ref.*
*See also Tosco.

Colombia Amerada Hess ... Amoco ... Ashland ... Bayway Ref.* ... British Petroleum 6 Caribbean Gulf ... Chevron ... Citgo ... Clark ... Coastal ... Conoco 1 Crown 2 Deer Park Ref. ... D. Shamrock ... Exxon 5 Fina 3 Kerr-McGee 21 Koch ... La Gloria ... LL&E ... Lyondell 1 Marathon ... Metallgesellschaft 1 Mobil 22 Murphy 21 Oiltanking Houston ... Pacific Refining ... Phibro 32 Shell 1 SW Refining ... Sun 7 Texaco ... ... Tosco Total (France) ... Total 123 Congo Amerada Hess Amoco Chevron Clark Exxon ... 2 1 ... ...

... ... ... ...

See also Bayway Refining. Joint venture between Shell and Pemex. Formerly Pacific Resources. Now BHP.

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US CRUDE OIL IMPORTS BY COUNTRY OF ORIGIN AND COMPANY, 1991-95 (In 1,000 b/d)
Congo (cont.) Farmland Marathon Phibro Phillips Total Denmark Kerr-McGee Sun Total Dubai Ashland Exxon Koch Total 1991 ... ... 5 22 30 ... ... ... ... ... ... ... 1992 ... ... 1 26 78 ... ... ... ... ... ... ... ... ... ... ... 1 7 1 ... 2 6 1 ... 1 ... ... 1 ... ... ... ... ... ... 10 ... ... 2 1 ... ... ... 14 ... 1 16 ... 5 69 1993 1 7 9 29 74 1 ... 1 3 4 ... 7 ... ... ... 2 3 1 ... 1 2 2 1 ... ... ... ... ... ... 7 ... ... 2 7 1 ... ... 2 2 ... ... ... 20 3 ... 9 ... 21 86 1994 1 1 1 21 54 ... 2 2 ... ... 2 2 6 ... 2 ... ... 26 1 ... 1 ... 2 ... ... 1 ... ... ... 2 ... ... ... ... 7 ... 1 ... 3 15 2 2 6 8 ... 3 5 ... 93 1995 3 3 4 ... 29 ... ... ... ... ... 2 2 ... 2 ... ... ... 7 ... ... 14 ... 4 2 ... 2 ... ... 1 ... 3 2 3 ... 11 4 6 ... 4 14 ... 2 16 10 ... 7 6 ... 120 Egypt Chevron Clark Coastal Conoco Exxon Fina Marathon Mobil Phibro Phillips Star Enterprise Total Gabon Amerada Hess Amoco Bayway Ref.* British Petroleum Chevron Clark Coastal Exxon Mobil Phibro Star Enterprise Sun Valero Total Guatemala Amoco Exxon Mobil Total Guinea Pacific Res. Indonesia Amerada Hess Amoco BHP British Petroleum Chevron Clarendon Clark Coastal Deer Park Ref. D. Shamrock Exxon Fina Kerr-McGee Koch LL&E Lyondell 1991 ... ... ... ... ... ... ... ... ... ... 17 17 ... ... ... 1 1 ... 39 10 2 32 ... ... ... 85 3 1 1 5 ... ... ... ... 2 46 ... ... 10 ... ... 1 ... ... 1 ... ... 1992 3 ... ... ... ... ... 4 3 2 ... 21 33 14 1 ... 8 18 ... 29 24 1 41 ... 3 ... 139 5 ... ... 5 2 2 ... ... 1 43 2 ... 1 ... ... 2 3 2 ... ... ... 1993 7 1 2 1 15 3 4 9 1 1 21 65 9 ... 26 2 18 3 29 26 3 43 ... ... ... 159 6 ... ... 6 ... ... ... 6 2 34 ... ... ... ... ... ... ... ... ... 1 ... 1994 2 ... 2 ... 3 ... ... 17 ... ... 25 49 23 ... 43 30 10 ... 36 14 1 55 3 3 ... 218 5 ... ... 5 ... 3 5 28 ... 46 ... 2 6 0.4 0.2 1 ... ... 0.4 ... 1 1995 7 ... ... ... ... ... ... 13 1 ... 13 34 19 1 40 59 ... 15 53 18 1 50 5 5 1 267 9 ... ... 9 ... ... ... 25 ... 37 ... ... ... ... ... ... ... ... 1 ... ...

Ecuador Amoco ... Arco ... ... BHP British Petroleum ... Caribbean Gulf ... Chevron ... Citgo 1 Clarendon ... Clark ... Coastal 8 Conoco ... Deer Park Ref. ... Enron ... Exxon ... Fina 4 Golden West ... Hunt ... Indian Refining ... Koch ... LL&E ... Lyondell 5 Metallgesellschaft ... Mobil 15 Murphy ... Oiltanking Houston ... 2 Pacific Res. Phibro ... Powerine ... Shell 4 Star Enterprise ... Sun ... Texaco 1 Thrifty 4 2 Tosco Total (France) ... Wickland ... Total 46

*See also Tosco.

See also Bayway Refining. Joint venture between Shell and Pemex. Formerly Pacific Resources. Now BHP.

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US CRUDE OIL IMPORTS BY COUNTRY OF ORIGIN AND COMPANY, 1991-95 (In 1,000 b/d)
Indonesia (cont.)1991 Pacific Refining Pacific Res. Phibro Shell Sound Refining Texaco Tosco Unocal Valero Total Italy Chevron ... 19 5 1 ... ... ... 8 ... 93 3 1992 ... 15 3 ... ... ... ... ... ... 74 ... ... 3 ... 17 ... ... ... 17 1 1 ... ... ... ... ... ... 39 ... ... ... ... 3 ... ... ... ... ... ... 1 5 ... ... 1 ... ... 10 75 ... 1993 ... 18 3 1 ... ... ... ... ... 65 ... 5 11 35 60 1 1 ... 104 23 50 1 ... 19 35 1 ... 346 ... 4 1 2 2 ... ... ... ... ... ... ... ... ... 1 ... ... ... 10 71 ... 1994 1 ... 1 ... 0.1 1 0.4 ... ... 97 ... 0.1 ... 47 52 ... ... 13 102 25 51 ... ... 15 ... 3 ... 308 ... ... ... ... ... 2 0.2 2 1 ... 1 ... ... ... 2 ... ... ... 8 68 ... 1995 ... ... ... ... ... 3 ... ... 1 67 ... ... ... 46 30 ... ... ... 69 18 56 ... 3 2 ... 6 2 232 ... ... 2 ... 2 ... ... ... ... 2 ... ... ... ... ... ... ... ... 6 70 13 Mexico (cont.) 1991 1992 ... ... 131 60 30 29 36 ... ... 27 24 8 18 53 60 131 1 ... ... 82 ... 31 ... 1 ... 797 ... ... ... ... ... 35 56 8 ... 184 81 ... ... ... ... 1 ... ... 15 8 ... ... 1 ... ... 1993 ... ... 126 66 32 36 54 ... 1 43 38 9 27 31 47 155 5 ... ... 110 3 26 ... ... 2 882 1 ... 1 1 3 71 82 4 3 211 128 ... 5 ... 2 2 ... ... 3 10 ... ... 4 3 ... 1994 ... 2 155 55 25 31 82 28 ... 56 34 7 35 4 30 170 18 2 21 91 4 31 ... ... ... 949 ... 1 ... ... 1 115 32 1 8 153 61 ... 18 25 ... 2 33 8 ... 5 10 ... ... 37 ... 1995 4 ... 135 31 45 43 72 129 ... 99 45 8 28 ... 24 224 21 4 9 80 22 15 ... ... ... 1,121 ... ... ... ... ... 145 44 ... 1 198 1 1 22 26 ... 9 6 1 ... ... ... 1 ... 45 1 Bayway Ref.* ... British Petroleum ... Chevron 131 Citgo 47 Clark 34 Coastal 34 Conoco 31 Deer Park Ref. ... Enron ... Exxon 33 Fina 21 Hunt 6 Koch 8 Lyondell 82 Marathon 57 Mobil 104 Murphy 18 Phibro ... Phillips ... Shell 72 Star Enterprise ... Sun 20 1 Tosco Ultramar ... Unocal ... Total 763 New Zealand British Petroleum Deer Park Ref. Kerr-McGee Shell Total ... ... ... ... ...

Kuwait Amerada Hess ... Amoco 3 Ashland ... Chevron ... Cibro ... Clark ... Deer Park Ref. ... Exxon ... Fina 1 Marathon ... Mobil 1 Oiltanking Houston ... Phillips ... Shell ... Star Enterprise ... Texaco ... Total 5 Malaysia Amoco Astra BHP British Petroleum Chevron Coastal Crown Deer Park Ref. D. Shamrock Koch La Gloria Pacific Refining Pacific Res. Phibro Shell Texaco Thrifty Unocal Total Mexico Amoco Ashland
*See also Tosco.

1 ... ... ... ... 4 ... ... ... ... ... ... 10 3 2 ... 1 2 23 64 ...

Nigeria Amerada Hess ... Amoco 55 Ashland ... Bayway Ref.* ... British Petroleum 184 Chevron 89 Citgo ... Clark ... Coastal ... Conoco 7 Crown 6 Deer Park Ref. ... D. Shamrock ... Exxon ... Fina ... Indian Refining ... Intercont. Term ... Kerr-McGee 1 Koch 7 La Gloria ...

See also Bayway Refining. Joint venture between Shell and Pemex. Formerly Pacific Resources. Now BHP.

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US CRUDE OIL IMPORTS BY COUNTRY OF ORIGIN AND COMPANY, 1991-95 (In 1,000 b/d)
Nigeria (cont.) 1991 1992 ... ... ... 5 8 2 4 22 142 ... ... 128 ... 700 ... 1 7 ... 21 ... ... 7 ... 6 ... 1 49 1 ... 3 ... 9 ... 3 ... ... ... ... 6 6 120 ... ... 4 ... ... ... ... ... ... ... 1993 ... ... 3 ... 31 4 3 25 105 ... ... 92 ... 791 3 ... 3 56 9 ... ... 3 4 4 ... 13 11 1 ... ... ... 7 ... 1 ... 4 ... ... 3 ... 122 3 ... 6 3 2 ... ... 1 ... 6 1994 3 1 3 ... 19 ... 2 32 63 13 ... 95 ... 739 11 8 1 101 14 1 ... ... ... 7 1 3 4 ... 3 ... 6 ... ... ... 5 11 1 6 ... 18 201 1 ... 19 3 4 ... ... ... 1 1 1995 ... 7 10 ... 39 2 ... 56 39 5 3 146 1 809 3 6 ... 115 5 13 1 8 2 10 ... 42 2 3 ... ... 7 ... 1 ... 2 20 ... ... ... 45 285 3 4 5 ... ... ... 2 ... ... ... Oman (cont.) 1991 1992 ... ... ... 4 ... ... ... ... ... ... ... ... ... ... ... ... ... ... 1 ... 1 1 ... ... ... 1 ... ... 1 ... 1 ... 2 ... 5 47 137 138 ... 172 ... 11 ... ... 188 19 7 1993 ... 1 8 30 ... 2 ... ... 2 2 5 ... 11 ... ... ... ... ... ... ... ... ... ... ... 1 3 ... 5 3 ... ... 6 7 8 33 28 114 80 ... 160 ... 1 1 ... 94 ... 8 1994 1 1 14 45 10 ... 2 0.2 2 ... ... 4 18 ... ... ... ... ... ... ... ... ... 2 1 ... 1 3 7 ... 3 ... 7 3 1 28 59 110 82 2 155 ... ... ... 27 117 ... 8 1995 ... ... 5 19 5 ... ... ... ... ... ... ... 5 2 1 13 1 1 ... 5 23 ... 3 ... ... 3 ... 2 ... ... ... 5 ... 1 14 81 61 57 ... 176 ... ... ... 5 145 ... 3 LL&E ... Lyondell 1 Marathon 3 Metallgesellschaft ... Mobil ... Murphy 2 Phibro 7 Phillips 17 Shell 117 SW Refining ... Star Enterprise ... Sun 187 Valero ... Total 683 Norway Amerada Hess ... Amoco 10 Ashland ... Bayway Ref.* ... British Petroleum 12 Chevron ... Citgo ... Clark 2 Coastal ... Crown 5 Deer Park Ref. ... D. Shamrock 13 Exxon 3 Fina ... Indian Refining ... Kerr-McGee ... Koch ... Marathon 1 Mobil 4 Murphy ... Phibro ... Phillips 23 Shell ... SW Refining ... Strategic Pet. Res. ... Sun ... Total 73 Oman Ashland ... ... BHP Chevron 2 Crown ... Exxon ... Fina 2 Murphy ... ... Pacific Res. Phillips ... Shell ...
*See also Tosco.

Star Enterprise ... Sun ... ... Tosco Total 4 Papua New Guinea ... BHP British Petroleum ... Crown ... D. Shamrock ... Koch ... ... Pacific Res. Phibro ... Shell ... Total ... Peru Amoco ... Citgo ... Conoco ... Marathon ... Mobil 1 Phibro ... Texaco ... Total 1 Philippines Unocal Russia Amoco Ashland Chevron Clark Coastal Exxon Fina Indian Refining Lyondell Marathon Mobil Phibro Total ... ... ... ... 2 ... ... ... ... ... ... ... 1 3

Saudi Arabia Amerada Hess ... Amoco 117 Ashland 142 British Petroleum ... Chevron 214 Clark 1 Coastal ... Conoco ... Deer Park Ref. ... Exxon 237 Fina 44 Hunt 4

See also Bayway Refining. Joint venture between Shell and Pemex. Formerly Pacific Resources. Now BHP.

CRUDE OIL HANDBOOK

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US CRUDE OIL IMPORTS BY COUNTRY OF ORIGIN AND COMPANY, 1991-95 (In 1,000 b/d)
S. Arabia (cont.) 1991 Intercont. Term ... Koch 3 Lion ... Lyondell 62 Marathon 141 Mobil 59 Murphy ... Oiltanking Houston ... Phibro 15 Phillips 41 Shell 59 Star Enterprise 520 Sun 44 Texaco 1 Total (France) ... Tx Petrochem ... Total 1,704 Singapore Chevron Koch Total Spain Deer Park Ref. Shell Total Syria Amoco Chevron Clark Conoco Crown Exxon Koch Phibro Total Thailand Astra British Petroleum D. Shamrock Kerr-McGee Koch Lyondell Shell SW Refining Unocal US Oil & Refining Total ... ... ... ... ... ... ... ... 1 ... 1 ... ... 3 5 ... 2 ... ... ... ... ... ... 1 ... 3 1992 ... ... 23 41 137 53 1 ... 12 64 48 496 53 ... ... ... 1,647 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 3 ... 1 ... ... ... ... ... ... 4 69 1 1 ... 1993 ... ... 26 ... 110 41 ... ... 1 52 51 493 44 ... ... ... 1,304 1 ... 1 ... ... ... 10 1 ... 2 ... 1 3 ... 17 2 1 1 1 ... ... 1 ... ... ... 6 54 ... ... 1 1994 ... ... 33 ... 91 59 ... 1 ... 70 3 463 78 ... 1 1 1,360 ... ... ... ... ... ... 1 1 ... ... ... ... ... ... 2 ... ... ... ... 2 1 2 3 1 0.2 9 61 ... ... 1 1995 1 ... 31 ... 111 90 ... ... ... 75 15 514 86 ... ... ... 1,451 ... 1 1 1 0.4 1 ... ... ... ... ... ... ... ... ... ... ... ... ... 1 ... ... ... ... ... 1 66 ... ... ... T&T (cont.) Phibro Total Tunisia Crown 1991 1 72 ... 1992 ... 71 2 ... ... ... ... ... ... ... ... ... ... ... ... ... ... 1 7 4 6 ... ... 18 ... 25 ... 1 16 ... 14 22 ... ... 3 10 3 3 7 1 ... ... 7 4 ... ... 4 41 ... 197 1993 ... 55 ... 1 ... ... ... ... ... ... 4 ... 5 1 1 20 12 ... ... 14 ... ... 3 23 ... 29 1 3 14 ... 12 22 ... ... ... 26 ... ... 8 ... ... ... 7 16 ... 1 8 91 ... 312 1994 0.3 62 ... ... 2 ... 1 3 ... ... ... 2 8 38 7 15 13 5 13 10 4 ... ... 18 4 51 ... 15 45 1 ... 17 1 ... 1 31 ... ... 6 ... 3 1 3 6 10 4 12 115 11 460 1995 ... 66 ... ... ... ... ... ... 1 1 ... 1 3 15 18 11 22 6 4 17 19 7 0.3 22 ... 24 ... 11 52 ... ... 32 4 3 11 5 ... 3 ... ... ... ... 14 ... 7 ... ... 94 ... 401

United Arab Emirates Astra ... Chevron ... Clark ... Deer Park Ref. ... Exxon ... Intercont. Term ... LL&E ... Phibro ... Shell ... Total ... United Kingdom Amerada Hess ... Amoco 1 Ashland 4 Bayway Ref.* ... British Petroleum ... Chevron 11 Citgo 3 Clark 8 Coastal ... Conoco ... Crown 17 Deer Park Ref. ... D. Shamrock 2 Enron ... Exxon ... Fina 11 Indian Refining ... Kerr-McGee 20 Koch 1 La Gloria ... LL&E ... Lyondell 2 Marathon 2 Metallgesellschaft 3 Mobil 1 Murphy 1 Northeast Petro ... Oiltanking Houston ... Phibro ... Phillips 4 Shell ... SW Refining ... Star Enterprise ... Strategic Pet. Res. ... Sun 14 Texaco ... Total 105

Trinidad & Tobago Amoco 70 Clark 1 Coastal ... Conoco ...


*See also Tosco.

Joint venture between Shell and Pemex.

G46 Venezuela 1991 1992 ... 29 ... 28 24 4 294 ... 33 67 12 13 7 13 29 ... 59 ... ... ... 25 ... 3 ... ... 2 52 19 12 ... 12 121 1 859 ... 1993 ... 33 ... 30 20 2 309 ... 30 44 21 3 8 18 134 ... 118 ... ... ... 40 ... ... ... ... 2 50 16 12 ... 16 121 ... 1,027 ... 1994 ... 31 10 34 13 ... 307 9 42 44 21 4 7 10 119 12 121 14 ... 12 34 25 ... ... 4 3 42 ... 16 1 19 118 ... 1,072 ...

PIW 1995 1 43 4 8 24 ... 348 22 51 41 19 3 10 10 161 9 119 35 22 16 59 40 ... ... 3 2 49 15 18 ... ... 131 ... 1,263 1

CRUDE OIL HANDBOOK 1991 ... ... 2 ... 3 3 ... ... 3 ... ... ... 5 ... 16 ... 3 18 ... 1 ... 1 ... ... ... 1 1 1 ... 26 1992 ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 1 3 4 ... 2 4 ... 2 ... ... ... 2 ... ... 18 6,399 1993 1 ... 2 ... ... ... ... 1 ... ... ... 3 ... ... 7 ... 5 9 ... 2 ... ... ... ... 1 ... 2 ... ... 19 7,043 1994 8 1 ... 4 ... ... 1 1 ... 7 0.3 ... ... ... 22 1 4 6 ... 3 ... ... ... ... ... ... ... ... 2 16 7,469 1995 ... ... ... ... ... ... ... ... ... 3 ... ... ... 2 5 2 4 ... 2 1 3 2 ... 1 ... ... 2 ... 1 18 8,217

Yemen Amoco Ashland British Petroleum Chevron Clark Coastal Crown Exxon Fina Koch La Gloria Phillips Shell Sun Total Zaire Amerada Hess British Petroleum Chevron Clark Coastal Crown Exxon Kerr-McGee Koch Lyondell Mobil Phibro Phillips Sun Total Grand Total

Deer Park Ref. ... Amoco 18 British Petroleum ... Caribbean Gulf ... Chevron 10 Cibro ... Citgo 152 Clark 1 Coastal 22 Conoco 76 Ergon ... Exxon 18 Hunt 7 Koch 7 Lyondell 7 Marathon ... Mobil 37 Murphy ... Neste ... Oiltanking Houston ... Phibro 7 Phillips ... Seaview ... Shell 1 Sinclair ... Sound Refining ... Star Enterprise 36 Sun 13 Texaco 14 ... Tosco Trifinery ... Unoven ... US Oil & Refining ... Total 426 Vietnam Chevron ...

5,338

Note: May not add due to rounding.

Joint venture between Shell and Pemex.

See also Bayway Refining.

Crude Oil Profiles


Table of Contents
Crude Oil Profiles A View Of the Market Through Each Grade . . . . . . . . . .H1 The Crude Oils And Their Key Characteristics . . . . . . . . . . . . . . . . . . . . . . . .H3 Crude Oil Streams Ranked And Indexed By Gravity . . . . . . . . . . . . . . . . . . .H7 Crude Oil Streams Ranked And Indexed By Sulfur Content . . . . . . . . . . . . . .H9 Crude Oil Streams Ranked And Indexed By Volume . . . . . . . . . . . . . . . . . . .H9 Crude Oil Streams Indexed By Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .H11 Crude Oil Profiles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .H13 Abu Dhabi . . . . . . . . . . . . . . . . . .H13 Algeria . . . . . . . . . . . . . . . . . . . .H27 Angola . . . . . . . . . . . . . . . . . . . .H33 Argentina . . . . . . . . . . . . . . . . . .H39 Australia . . . . . . . . . . . . . . . . . . .H47 Brunei . . . . . . . . . . . . . . . . . . . . .H55 Cameroon . . . . . . . . . . . . . . . . . .H63 Canada . . . . . . . . . . . . . . . . . . . .H67 China . . . . . . . . . . . . . . . . . . . . .H73 Colombia . . . . . . . . . . . . . . . . . . .H77 Congo . . . . . . . . . . . . . . . . . . . . .H83 Dubai . . . . . . . . . . . . . . . . . . . . .H87 Ecuador . . . . . . . . . . . . . . . . . . .H91 Egypt . . . . . . . . . . . . . . . . . . . . .H93 Gabon . . . . . . . . . . . . . . . . . . . .H103 Indonesia . . . . . . . . . . . . . . . . .H109 Iran . . . . . . . . . . . . . . . . . . . . . .H129 Iraq . . . . . . . . . . . . . . . . . . . . . .H139 Kuwait . . . . . . . . . . . . . . . . . . . .H145 Libya . . . . . . . . . . . . . . . . . . . . .H147 Malaysia . . . . . . . . . . . . . . . . . .H161 Mexico . . . . . . . . . . . . . . . . . . .H171 Neutral Zone . . . . . . . . . . . . . . .H177 Nigeria . . . . . . . . . . . . . . . . . . .H183 Norway . . . . . . . . . . . . . . . . . . .H195 Oman . . . . . . . . . . . . . . . . . . . .H211 Papua New Guinea . . . . . . . . . .H213 Qatar . . . . . . . . . . . . . . . . . . . . .H215 Russia . . . . . . . . . . . . . . . . . . . .H219 Saudi Arabia . . . . . . . . . . . . . . .H223 Sharjah . . . . . . . . . . . . . . . . . . .H233 Syria . . . . . . . . . . . . . . . . . . . . .H237 United Kingdom . . . . . . . . . . . .H241 United States . . . . . . . . . . . . . . .H251 Venezuela . . . . . . . . . . . . . . . . .H261 Vietnam . . . . . . . . . . . . . . . . . . .H273 Yemen . . . . . . . . . . . . . . . . . . . .H275 Zaire . . . . . . . . . . . . . . . . . . . . .H279

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H1

CRUDE OIL PROFILES

A View Of The Market Through Each Grade


This section provides detailed profiles of 134 internationally traded crude oils, including several new crude oils and condensates from Latin America, Europe, and Asia. This section not only contains the most up-to-date, detailed assays for the individual crude oil streams, but also complete assessments of their production, quality, marketing, pricing, and logistical positions. It is a comprehensive reference section that is meant to complement the earlier descriptive chapters. This section essentially allows the reader to have a close look at the pieces that together constitute the international crude oil market. The presentation of the information on the individual crude oils is self-explanatory, with further details on marketing available in many cases in the sections on country crude oil sales policies in Chapter F. Chapter E, on refining, also covers the basic technical aspects of the crude oil assays. The information on the individual crude oils is as up-to-date and complete as possible, but the coverage of some crude oils is not as comprehensive as that of others because of the limited availability of certain data. All of the crude oil profiles are organized alphabetically according to country. In order to make this section easy to use, several indexes have also been prepared. For quick comparisons, the first lists the crude oils as they appear in the handbook along with some key data on volume, specifications, and loading ports. The next index lists all of the crude oil names alphabetically both those names currently in use and the secondary or former names of the crude oils. The third, fourth, and fifth indexes list all of the crude oils by their API gravities, their sulfur contents, and their supply volumes.

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H3

THE CRUDE OILS AND THEIR KEY CHARACTERISTICS


Gravity Country/Crude Oil Abu Dhabi Abu Bukhoosh Mubarraz Murban Thamama Condensate Umm Shaif Upper Zakum Zakum Algeria Algerian Condensate Saharan Blend Zarzaitine Angola Cabinda Palanca Soyo Argentina Canadon Seco Escalante Medanito Rincon Australia Cossack Gippsland Griffin Northwest Shelf Condensate Brunei Brunei Condensate Brunei Light Champion Seria Light Export Blend Cameroon Kole Lokele Canada Bow River Hibernia Mixed Blend Sweet China Daqing Shengli Colombia Cano Limon Cusiana Vasconia Congo Djeno NKossa Dubai Dubai Margham Condensate API Gravity 31.5 39.5 40.4 57.5 36.8 32.9 39.2 64.6 46.1 42.8 32.0 38.6 39.5 25.7 24.1 35.1 36.1 47.0 47.0 55.0 59.5 66.5 40.3 23.7 34.6 34.8 19.6 25.6 32.0 39.0 32.1 22.5 29.5 36.3 25.3 27.6 39.5 31.0 50.2 Sulfur Volume Content 1,000 b/d 1.90 0.90 0.79 0.11 1.38 1.78 1.10 <0.01 0.11 0.01 0.13 0.14 0.12 0.20 0.19 0.43 0.28 0.03 0.09 0.03 <0.01 <0.01 0.06 0.13 0.08 0.30 0.41 2.37 0.50 0.39 0.11 0.90 0.47 0.25 0.81 0.23 0.08 2.04 0.04 35 15 890 130 190 460 245 300 700 100 430 175 95 90 50 300 95 115 228 80 80 20 50 80 70 75 20 660 ... 250 1,100 600 215 200 145 150 90 250 25 Primary Loading Port Abu al-Bukhoosh Mubarraz Island Jebel Dhanna Jebel Dhanna Das Island Das Island Das Island Arzew Arzew/Bejaia/Skikda La Skhirra (Tunisia) Cabinda Palanca Quinfuquena Celeta Olivia, Caltea Cordova Bahia Blanca Bahia Blanca San Vincente, Chile Cossack FPSO Westernport Griffin FPSO Withnell Bay Seria Seria Seria Seria Kole Lokele Interprovincial Pipe Line Hibernia Platform Interprovincial Pipe Line Dairen (Dalian) Qingdao (Tsing Tao) Covenas Covenas Covenas Djeno NKossa Fateh Jebel Ali Page H13 H15 H17 H19 H21 H23 H25 H27 H29 H31 H33 H35 H37 H39 H41 H43 H45 H47 H49 H51 H53 H55 H57 H59 H61 H63 H65 H67 H69 H71 H73 H75 H77 H79 H81 H83 H85 H87 H89

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CRUDE OIL HANDBOOK

THE CRUDE OILS AND THEIR KEY CHARACTERISTICS (cont.)


Gravity Country/Crude Oil Ecuador Oriente Egypt Belayim Blend Ras Budran Ras Gharib Blend Suez Blend Zeit Bay Gabon Lucina Mandji Rabi Indonesia Ardjuna Arun Condensate Attaka Belida Cinta Duri Handil Lalang Minas Widuri Iran Foroozan Blend Iran Heavy Iran Light Lavan Blend Sirri Basrah Light Fao Blend Kirkuk API Gravity 28.8 26.1 24.3 24.1 31.5 33.8 39.2 30.2 34.6 36.7 54.3 42.3 40.0 32.8 20.3 32.2 39.2 34.1 33.2 30.7 30.2 33.1 34.3 30.3 34.4 27.5 37.0 30.5 36.1 26.0 39.8 37.0 37.6 42.2 41.5 66.2 39.9 32.1 29.6 45.2 33.3 21.5 39.1 Sulfur Volume Content 1,000 b/d 1.02 2.23 2.39 3.00 1.54 1.35 0.03 1.14 0.06 0.09 <0.01 0.09 0.01 0.12 0.19 0.10 0.11 0.09 0.07 2.50 1.77 1.50 1.87 2.26 2.10 2.90 2.00 2.55 0.15 ... 0.20 0.27 0.16 0.40 0.31 0.04 0.12 0.07 0.07 0.03 1.22 3.43 0.72 350 200 20 25 400 20 8 120 220 80 90 50 115 55 275 40 25 395 75 275 1,500 1,300 140 30 300 ... 250 1,800 115 90 120 445 195 85 70 60 100 80 60 340 920 1,350 580 Primary Loading Port Esmeraldas Wadi El Firan Ras Budran Ras Gharib Ras Shukheir Zeit Bay Lucina Cape Lopez Cape Lopez (Shell) /Gamba (Elf) Ardjuna Lhokseumawe Santan Belida Cinta Dumai Senipah Lalang Marine Terminal Dumai Widuri Kharg Island Kharg Island Kharg Island Lavan Island Sirri Island Mina Al-Bakr/Ceyhan (Turkey) Mina Al-Bakr Ceyhan (Turkey) Mina Al Ahmadi Ras Lanuf Bouri Marsa El Brega Es Sider Marsa El Hariga Ras Lanuf Zueitina Bintulu Dulang Terminal Labuan Miri Tapis Dos Bocas/Salina Cruz Cayo Arcas/Salina Cruz Dos Bocas Page H91 H93 H95 H97 H99 H101 H103 H105 H107 H109 H111 H113 H115 H117 H119 H121 H123 H125 H127 H129 H131 H133 H135 H137 H139 H141 H143 H145 H147 H149 H151 H153 H155 H157 H159 H161 H163 H165 H167 H169 H171 H173 H175

Iraq

Kuwait Kuwait Libya Amna Bouri Brega Es Sider Sarir Sirtica Zueitina Malaysia Bintulu Condensate Dulang Labuan Miri Tapis Mexico Isthmus Maya Olmeca

CRUDE OIL HANDBOOK

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H5

THE CRUDE OILS AND THEIR KEY CHARACTERISTICS (cont.)


Gravity Country/Crude Oil Neutral Zone Hout Khafji Wafra Nigeria Bonny Light Bonny Medium Brass River Escravos Forcados Qua Iboe Norway Draugen Ekofisk Gullfaks Heidrun Oseberg Sleipner Condensate Statfjord Troll Oman Oman Papua New Guinea Kutubu Qatar Dukhan Qatar Marine Russia Siberian Light Urals Saudi Arabia Arabian Extra Light Arabian Heavy Arabian Light Arabian Medium Arabian Super Light Sharjah Mubarak Sharjah Condensate Syria Souedieh Syrian Light United Kingdom Brent Blend Captain Flotta Forties Liverpool Bay United States Alaskan North Slope Light Louisiana Sweet API Gravity 32.5 28.5 24.2 35.4 26.5 41.5 36.2 28.5 35.9 39.8 39.4 29.9 28.6 36.3 59.0 38.7 28.6 35.2 44.0 41.1 36.2 35.6 33.4 36.4 27.5 32.7 31.8 50.6 38.2 50.0 24.0 36.5 38.3 20.0 35.4 40.1 43.3 27.5 38.7 Sulfur Volume Content 1,000 b/d 1.90 2.85 4.00 0.14 0.22 0.09 0.14 0.19 0.12 0.15 0.19 0.41 0.46 0.29 0.02 0.24 0.29 0.89 0.04 1.22 1.60 0.46 1.19 1.19 2.92 1.80 2.45 0.04 0.57 0.08 4.05 0.66 0.37 0.50 1.22 0.34 0.24 1.16 0.13 30 280 200 475 80 150 360 450 340 130 530 460 230 700 110 790 200 880 100 240 200 90* 2,500* 950 400 5,000 1,300 200 17 40 150 450 775 ... 250 975 40 1,450 600 Primary Loading Port Ras al-Khafji Ras al-Khafji Mina Saud (Mina al-Zour) Bonny Bonny Brass River Escravos Forcados Qua Iboe Draugen Tees River (UK) Gullfaks/Mongstad Heidrun Sture Karsto Statfjord/Mongstad Mongstad Mina Al Fahal Kumul Umm Said Halul Island Tuapse Novorossiysk/Ventspils Ras Tanura Juaymah/Ras Tanura Juaymah/Ras Tanura/Yanbu Juaymah/Ras Tanura Yanbu Mubarak Hamriyah Terminal Baniyas/Tartous Baniyas/Tartous Sullom Voe Captain FPSO Flotta Hound Point Liverpool Bay Platform Valdez St. James Page H177 H179 H181 H183 H185 H187 H189 H191 H193 H195 H197 H199 H201 H203 H205 H207 H209 H211 H213 H215 H217 H219 H221 H223 H225 H227 H229 H231 H233 H235 H237 H239 H241 H243 H245 H247 H249 H251 H253

H6

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CRUDE OIL HANDBOOK

THE CRUDE OILS AND THEIR KEY CHARACTERISTICS (cont.)


Country/Crude Oil United States (cont.) Mars Blend West Texas Intermediate West Texas Sour Venezuela Bachaquero BCF-17 Boscan Furrial Tia Juana Heavy Tia Juana Light Vietnam Bach Ho Yemen Marib Masila Zaire Zaire *Export figures. API Gravity 31.0 39.6 34.2 13.0 16.2 10.1 30.0 12.3 32.0 33.8 48.0 30.5 31.2 Sulfur Volume Content 1,000 b/d 2.00 0.24 1.30 2.68 2.47 5.40 1.10 2.82 1.20 0.08 0.10 0.62 0.11 70 750 775 250 ... 60 300 80 240 140 170 175 30 Primary Loading Port Clovelly, LOOP Cushing/Midland Midland Punta Cardon La Salina Bajo Grande Puerto La Cruz Punta Cardon La Salina Bach Ho Platform Ras Isa Ash Shihr Moanda Terminal Page H255 H257 H259 H261 H263 H265 H267 H269 H271 H273 H275 H277 H279

CRUDE OIL HANDBOOK

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H7

CRUDE OIL STREAMS RANKED AND INDEXED BY GRAVITY


Gravity API 66.5 66.2 64.6 59.5 59.0 57.5 55.0 54.3 50.6 50.2 50.0 48.0 47.0 47.0 46.1 45.2 44.0 43.3 42.8 42.3 42.2 41.5 41.5 41.1 40.4 40.3 40.1 40.0 39.9 39.8 39.8 39.6 39.5 39.5 39.5 39.4 39.2 39.2 39.2 39.1 39.0 38.7 38.7 38.6 38.3 38.2 37.6 37.0 37.0 36.8 36.7 36.5 36.4 36.3 36.3 36.2 Stream Brunei Condensate Bintulu Condensate Algerian Condensate Northwest Shelf Cond. Sleipner Condensate Thamama Condensate Griffin Arun Condensate Arabian Super Light Margham Condensate Sharjah Condensate Marib Cossack Gippsland Saharan Blend Tapis Kutubu Liverpool Bay Zarzaitine Attaka Sirtica Zueitina Brass River Dukhan Murban Brunei Light Forties Belida Dulang Brega Draugen West Texas Intermediate Mubarraz Soyo NKossa Ekofisk Zakum Lucina Lalang Olmeca Mixed Blend Sweet Statfjord Light Louisiana Sweet Palanca Brent Blend Mubarak Sarir Kirkuk Es Sider Umm Shaif Ardjuna Syrian Light Arabian Extra Light Cusiana Oseberg Escravos Country Brunei Malaysia Algeria Australia Norway Abu Dhabi Australia Indonesia S. Arabia Dubai Sharjah Yemen Australia Australia Algeria Malaysia PNG UK Algeria Indonesia Libya Libya Nigeria Qatar Abu Dhabi Brunei UK Indonesia Malaysia Libya Norway United States Abu Dhabi Angola Congo Norway Abu Dhabi Gabon Indonesia Mexico Canada Norway United States Angola UK Sharjah Libya Iraq Libya Abu Dhabi Indonesia Syria S. Arabia Colombia Norway Nigeria Page H55 H161 H27 H53 H205 H19 H51 H111 H231 H89 H235 H277 H47 H49 H29 H169 H213 H251 H31 H113 H157 H159 H187 H215 H17 H57 H249 H115 H163 H151 H195 H259 H15 H37 H85 H197 H25 H103 H123 H175 H71 H207 H255 H35 H243 H233 H155 H143 H153 H21 H109 H241 H223 H79 H203 H189 Gravity API 36.2 36.1 36.1 35.9 35.6 35.4 35.4 35.2 35.1 34.8 34.6 34.6 34.4 34.3 34.2 34.1 33.8 33.8 33.4 33.3 33.2 33.1 32.9 32.8 32.7 32.5 32.2 32.1 32.1 32.0 32.0 32.0 31.8 31.5 31.5 31.2 31.0 31.0 30.7 30.5 30.5 30.3 30.2 30.2 30.0 29.9 29.6 29.5 28.8 28.6 28.6 28.5 28.5 27.6 27.5 27.5 Stream Qatar Marine Rincon Amna Qua Iboe Siberian Light Bonny Light Flotta Oman Medanito Kole Seria Light Ex. Blend Rabi Basrah Light Lavan Blend West Texas Sour Minas Zeit Bay Bach Ho Urals Isthmus Widuri Iran Light Upper Zakum Cinta Arabian Light Hout Handil Daqing Labuan Cabinda Hibernia Tia Juana Light Arabian Medium Abu Bukhoosh Suez Blend Zaire Dubai Mars Blend Foroozan Blend Kuwait Masila Sirri Mandji Iran Heavy Furrial Gullfaks Miri Cano Limon Oriente Heidrun Troll Khafji Forcados Djeno Fao Blend Arabian Heavy Country Qatar Argentina Libya Nigeria Russia Nigeria UK Oman Argentina Cameroon Brunei Gabon Iraq Iran United States Indonesia Egypt Vietnam Russia Mexico Indonesia Iran Abu Dhabi Indonesia S. Arabia Neutral Zone Indonesia China Malaysia Angola Canada Venezuela S. Arabia Abu Dhabi Egypt Zaire Dubai United States Iran Kuwait Yemen Iran Gabon Iran Venezuela Norway Malaysia Colombia Ecuador Norway Norway Neutral Zone Nigeria Congo Iraq S. Arabia Page H217 H45 H147 H193 H219 H183 H247 H211 H43 H63 H61 H107 H139 H135 H261 H125 H101 H275 H221 H171 H127 H133 H23 H117 H227 H177 H121 H73 H165 H33 H69 H273 H229 H13 H99 H281 H87 H257 H129 H145 H279 H137 H105 H131 H269 H199 H167 H77 H91 H201 H209 H179 H191 H83 H141 H225

H8

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CRUDE OIL HANDBOOK

CRUDE OIL STREAMS RANKED AND INDEXED BY GRAVITY (cont.)


Gravity API 27.5 26.5 26.1 26.0 25.7 25.6 25.3 24.3 24.2 24.1 24.1 Stream Alaskan North Slope Bonny Medium Belayim Blend Bouri Canadon Seco Bow River Vasconia Ras Budran Wafra Escalante Ras Gharib Blend Country United States Nigeria Egypt Libya Argentina Canada Colombia Egypt Neutral Zone Argentina Egypt Page H253 H185 H93 H149 H39 H67 H81 H95 H181 H41 H97 Gravity API 24.0 23.7 22.5 21.5 20.3 20.0 19.6 16.2 13.0 12.3 10.1 Stream Souedieh Champion Shengli Maya Duri Captain Lokele BCF-17 Bachaquero Tia Juana Heavy Boscan Country Syria Brunei China Mexico Indonesia UK Cameroon Venezuela Venezuela Venezuela Venezuela Page H239 H59 H75 H173 H119 H245 H65 H265 H263 H271 H267

CRUDE OIL STREAMS RANKED AND INDEXED BY SULFUR CONTENT


Sulfur (%) <0.01 <0.01 <0.01 <0.01 0.01 0.01 0.02 0.03 0.03 0.03 0.03 0.04 0.04 0.04 0.04 0.06 0.06 0.07 0.07 0.07 0.08 0.08 0.08 0.08 0.09 0.09 0.09 0.09 0.09 0.10 0.10 0.11 0.11 0.11 0.11 0.11 0.12 0.12 Stream Algerian Condensate Arun Condensate Brunei Condensate Northwest Shelf Cond. Zarzaitine Belida Sleipner Condensate Cossack Griffin Lucina Tapis Margham Condensate Bintulu Condensate Kutubu Arabian Super Light Brunei Light Rabi Widuri Labuan Miri Seria Light Export Blend NKossa Sharjah Condensate Bach Ho Gippsland Ardjuna Attaka Minas Brass River Handil Marib Thamama Condensate Saharan Blend Daqing Lalang Zaire Soyo Cinta Country Algeria Indonesia Brunei Australia Algeria Indonesia Norway Australia Australia Gabon Malaysia Dubai Malaysia PNG S. Arabia Brunei Gabon Indonesia Malaysia Malaysia Brunei Congo Sharjah Vietnam Australia Indonesia Indonesia Indonesia Nigeria Indonesia Yemen Abu Dhabi Algeria China Indonesia Zaire Angola Indonesia Page H27 H111 H55 H53 H31 H115 H205 H47 H51 H103 H169 H89 H161 H213 H231 H57 H107 H127 H165 H167 H61 H85 H235 H273 H49 H109 H113 H125 H187 H121 H275 H19 H29 H73 H123 H279 H37 H117 Sulfur (%) 0.12 0.12 0.13 0.13 0.13 0.14 0.14 0.14 0.15 0.15 0.16 0.19 0.19 0.19 0.19 0.20 0.20 0.22 0.23 0.24 0.24 0.24 0.25 0.27 0.28 0.29 0.29 0.30 0.31 0.34 0.37 0.39 0.40 0.41 0.41 0.43 0.46 0.46 Stream Dulang Qua Iboe Cabinda Champion Light Louisiana Sweet Palanca Bonny Light Escravos Amna Draugen Sarir Escalante Duri Forcados Ekofisk Canadon Seco Brega Bonny Medium Djeno Statfjord Liverpool Bay West Texas Intermediate Cusiana Es Sider Rincon Oseberg Troll Kole Zueitina Forties Brent Blend Mixed Blend Sweet Sirtica Lokele Gullfaks Medanito Heidrun Siberian Light Country Malaysia Nigeria Angola Brunei United States Angola Nigeria Nigeria Libya Norway Libya Argentina Indonesia Nigeria Norway Argentina Libya Nigeria Congo Norway UK United States Colombia Libya Argentina Norway Norway Cameroon Libya UK UK Canada Libya Cameroon Norway Argentina Norway Russia Page H163 H193 H33 H59 H253 H35 H183 H189 H147 H195 H155 H41 H119 H191 H197 H39 H151 H185 H83 H207 H249 H257 H79 H153 H45 H203 H209 H63 H159 H247 H241 H71 H157 H65 H199 H43 H201 H219

CRUDE OIL HANDBOOK

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H9

CRUDE OIL STREAMS RANKED AND INDEXED BY SULFUR CONTENT (cont.)


Sulfur (%) 0.47 0.50 0.50 0.57 0.62 0.66 0.72 0.79 0.81 0.89 0.90 0.90 1.02 1.10 1.10 1.14 1.16 1.19 1.19 1.20 1.22 1.22 1.22 1.30 1.35 1.38 1.50 1.54 1.60 Stream Cano Limon Hibernia Captain Mubarak Masila Syrian Light Olmeca Murban Vasconia Oman Mubarraz Shengli Oriente Zakum Furrial Mandji Alaskan North Slope Urals Arabian Extra Light Tia Juana Light Isthmus Dukhan Flotta West Texas Sour Zeit Bay Umm Shaif Iran Light Suez Blend Qatar Marine Country Colombia Canada UK Sharjah Yemen Syria Mexico Abu Dhabi Colombia Oman Abu Dhabi China Ecuador Abu Dhabi Venezuela Gabon United States Russia S. Arabia Venezuela Mexico Qatar UK United States Egypt Abu Dhabi Iran Egypt Qatar Page H77 H69 H243 H233 H277 H239 H175 H17 H81 H211 H15 H75 H91 H25 H267 H105 H251 H221 H223 H271 H171 H215 H245 H259 H101 H21 H133 H99 H217 Sulfur (%) 1.77 1.78 1.80 1.87 1.90 1.90 2.00 2.00 2.04 2.10 2.23 2.26 2.37 2.39 2.45 2.47 2.50 2.55 2.68 2.82 2.85 2.90 2.92 3.00 3.43 4.00 4.05 5.40 Stream Iran Heavy Upper Zakum Arabian Light Lavan Blend Abu Bukhoosh Hout Kirkuk Mars Blend Dubai Basrah Light Belayim Blend Sirri Bow River Ras Budran Arabian Medium BCF-17 Foroozan Blend Kuwait Bachaquero Tia Juana Heavy Khafji Fao Blend Arabian Heavy Ras Gharib Blend Maya Wafra Souedieh Boscan Country Iran Abu Dhabi S. Arabia Iran Abu Dhabi Neutral Zone Iraq United States Dubai Iraq Egypt Iran Canada Egypt S. Arabia Venezuela Iran Kuwait Venezuela Venezuela Neutral Zone Iraq S. Arabia Egypt Mexico Neutral Zone Syria Venezuela Page H131 H23 H227 H135 H13 H177 H143 H255 H87 H139 H93 H137 H67 H95 H229 H263 H129 H145 H261 H269 H179 H141 H225 H97 H173 H181 H237 H265

CRUDE OIL STREAMS RANKED AND INDEXED BY VOLUME


(1,000 b/d) Vol. Stream 5,000 Arabian Light 2,500 Urals 1,800 Kuwait 1,500 Iran Heavy 1,450 Alaskan North Slope 1,350 Maya 1,300 Iran Light 1,300 Arabian Medium 1,100 Daqing 975 Forties 950 Arabian Extra Light 920 Isthmus 890 Murban 880 Oman 790 Statfjord 775 Brent Blend 775 West Texas Sour 750 West Texas Intermediate 700 Saharan Blend 700 Oseberg Country S. Arabia Russia Kuwait Iran United States Mexico Iran S. Arabia China UK S. Arabia Mexico Abu Dhabi Oman Norway UK United States United States Algeria Norway Page H227 H221 H145 H131 H251 H173 H133 H229 H73 H247 H223 H171 H17 H211 H207 H241 H259 H257 H29 H203 (1,000 b/d) Vol. Stream 660 Bow River 600 Shengli 600 Light Louisiana Sweet 580 Olmeca 530 Ekofisk 475 Bonny Light 460 Upper Zakum 460 Gullfaks 450 Forcados 450 Syrian Light 445 Es Sider 430 Cabinda 400 Suez Blend 400 Arabian Heavy 395 Minas 360 Escravos 350 Oriente 340 Tapis 340 Qua Iboe 300 Algerian Condensate Country Canada China United States Mexico Norway Nigeria Abu Dhabi Norway Nigeria Syria Libya Angola Egypt S. Arabia Indonesia Nigeria Ecuador Malaysia Nigeria Algeria Page H67 H75 H253 H175 H197 H183 H23 H199 H191 H239 H153 H33 H99 H225 H125 H189 H91 H169 H193 H27

H10

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CRUDE OIL HANDBOOK

CRUDE OIL STREAMS RANKED AND INDEXED BY VOLUME (cont.)


(1,000 b/d) Vol. Stream 300 Medanito 300 Basrah Light 300 Furrial 280 Khafji 275 Duri 275 Foroozan Blend 250 Mixed Blend Sweet 250 Dubai 250 Kirkuk 250 Flotta 250 Bachaquero 245 Zakum 240 Dukhan 240 Tia Juana Light 230 Heidrun 228 Gippsland 220 Rabi 215 Cano Limon 200 Cusiana 200 Belayim Blend 200 Wafra 200 Troll 200 Qatar Marine 200 Arabian Super Light 195 Sarir 190 Umm Shaif 175 Palanca 175 Masila 170 Marib 150 Djeno 150 Brass River 150 Souedieh 145 Vasconia 140 Lavan Blend 140 Bach Ho 130 Thamama Condensate 130 Draugen 120 Mandji 120 Brega 115 Cossack 115 Belida 115 Amna 110 Sleipner Condensate 100 Zarzaitine 100 Dulang Country Argentina Iraq Venezuela Neutral Zone Indonesia Iran Canada Dubai Iraq UK Venezuela Abu Dhabi Qatar Venezuela Norway Australia Gabon Colombia Colombia Egypt Neutral Zone Norway Qatar S. Arabia Libya Abu Dhabi Angola Yemen Yemen Congo Nigeria Syria Colombia Iran Vietnam Abu Dhabi Norway Gabon Libya Australia Indonesia Libya Norway Algeria Malaysia Page H43 H139 H267 H179 H119 H129 H71 H87 H143 H245 H261 H25 H215 H271 H201 H49 H107 H77 H79 H93 H181 H209 H217 H231 H155 H21 H35 H277 H275 H83 H187 H237 H81 H135 H273 H19 H195 H105 H151 H47 H115 H147 H205 H31 H163 (1,000 b/d) Vol. Stream 100 Kutubu 95 Soyo 95 Rincon 90 Canadon Seco 90 NKossa 90 Arun Condensate 90 Bouri 90 Siberian Light 85 Sirtica 80 Griffin 80 Northwest Shelf Cond. 80 Champion 80 Ardjuna 80 Labuan 80 Bonny Medium 80 Tia Juana Heavy 75 Kole 75 Widuri 70 Seria Light Export Blend 70 Zueitina 70 Mars Blend 60 Bintulu Condensate 60 Miri 60 Boscan 55 Cinta 50 Escalante 50 Brunei Light 50 Attaka 40 Handil 40 Sharjah Condensate 40 Liverpool Bay 35 Abu Bukhoosh 30 Sirri 30 Hout 30 Zaire 25 Margham Condensate 25 Ras Gharib Blend 25 Lalang 20 Brunei Condensate 20 Lokele 20 Ras Budran 20 Zeit Bay 17 Mubarak 15 Mubarraz 8 Lucina Country PNG Angola Argentina Argentina Congo Indonesia Libya Russia Libya Australia Australia Brunei Indonesia Malaysia Nigeria Venezuela Cameroon Indonesia Brunei Libya United States Malaysia Malaysia Venezuela Indonesia Argentina Brunei Indonesia Indonesia Sharjah UK Abu Dhabi Iran Neutral Zone Zaire Dubai Egypt Indonesia Brunei Cameroon Egypt Egypt Sharjah Abu Dhabi Gabon Page H213 H37 H45 H39 H85 H111 H149 H219 H157 H51 H53 H59 H109 H165 H185 H269 H63 H127 H61 H159 H255 H161 H167 H265 H117 H41 H57 H113 H121 H235 H249 H13 H137 H177 H279 H89 H97 H123 H55 H65 H95 H101 H233 H15 H103

CRUDE OIL HANDBOOK

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CRUDE OIL STREAMS INDEXED BY NAME (Primary Names In Bold)


Crude Oil Name ABK Abu Bukhoosh Abu Bukoosh Abu Dhabi Agha Jari Alaskan North Slope Alberta Light Algerian Condensate Alif Amal Amana Amna ANS Arabian Extra Light Arabian Heavy Arabian Light Arabian Medium Arabian Super Light Arabian Ultra Light Ardjuna Arjuna Arun Condensate Arzew Attaka Bach Ho Bachaquero Basrah Heavy (before 81) Basrah Light Basrah Medium Bass Strait BBQ BBQ BBQ BCF-17 Belayim Blend Belida Berri Bintulu Condensate Bonny Light Bonny Medium Boscan Bouri Bow River Brass Blend Brass River Brega Brent Blend Brunei Condensate Brunei Light Cabinda Canadian Par Canadon Seco Cano Limon Captain Champion Cinta Cinta Blend Country Abu Dhabi Abu Dhabi Abu Dhabi Abu Dhabi Iran United States Canada Algeria Yemen Libya Venezuela Libya United States Saudia Arabia Saudia Arabia Saudia Arabia Saudia Arabia Saudia Arabia Saudia Arabia Indonesia Indonesia Indonesia Algeria Indonesia Vietnam Venezuela Iraq Iraq Iraq Australia Nigeria Nigeria Nigeria Venezuela Egypt Indonesia Saudia Arabia Malaysia Nigeria Nigeria Venezuela Libya Canada Nigeria Nigeria Libya United Kingdom Brunei Brunei Angola Canada Argentina Colombia United Kingdom Brunei Indonesia Indonesia Page H13 H13 H13 H17 H133 H251 H71 H27 H275 H147 H267 H147 H251 H223 H225 H227 H229 H231 H231 H109 H109 H111 H29 H113 H273 H261 H141 H139 H141 H49 H183 H187 H193 H263 H93 H115 H223 H161 H183 H185 H265 H149 H67 H187 H187 H151 H241 H55 H57 H33 H71 H39 H77 H243 H59 H117 H117 Crude Oil Name Cossack Cusiana Cusiana Light Cusiana/Cupiagua Cyrus Daqing Darius Djeno Draugen Dubai Dukhan Dulang Duri Ekofisk El Morgan Emeraude Es Sider Escalante Escravos Fao Blend Fateh Fereidoon Flotta Forcados Foroozan Blend Forouzan Forties Furrial Gachsaran Gharib Blend Gippsland Gippsland Blend Griffin Gulf of Suez Gullfaks Gullfaks A-B Gullfaks C Handil Hassi-Messaoud Heidrun Hibernia Hout Iagifu Intan-Cinta Iran Heavy Iran Light Isthmus Khafji Kirkuk Kole Kutubu Kuwait Labuan Lalang Lalang Export Blend Lavan Blend Libyan Light Country Australia Colombia Colombia Colombia Iran China Iran Congo Norway Dubai Qatar Malaysia Indonesia Norway Egypt Congo Libya Argentina Nigeria Iraq Dubai Iran United Kingdom Nigeria Iran Iran United Kingdom Venezuela Iran Egypt Australia Australia Australia Egypt Norway Norway Norway Indonesia Algeria Norway Canada Neutral Zone Papua NG Indonesia Iran Iran Mexico Neutral Zone Iraq Cameroon Papua NG Kuwait Malaysia Indonesia Indonesia Iran Libya Page H47 H79 H79 H79 H129 H73 H129 H83 H195 H87 H215 H163 H119 H197 H99 H83 H153 H41 H189 H141 H87 H129 H245 H191 H129 H129 H247 H267 H131 H97 H49 H49 H51 H99 H199 H199 H199 H121 H29 H201 H69 H177 H213 H117 H131 H133 H171 H179 H143 H63 H213 H145 H165 H123 H123 H135 H159

H12

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CRUDE OIL HANDBOOK

CRUDE OIL STREAMS INDEXED BY NAME (Primary Names In Bold)


Crude Oil Name Light Louisiana Sweet Liverpool Bay LLS Lokele Lower Zakum Lucina Malongo Mandji Margham Condensate Marib Mars Blend Masila Maya Medanito Mesa Minas Miri Miri Light Mixed Blend Sweet Mubarak Mubarek Mubarraz Murban NKossa Nigerian Export Blend Nigerian Light Nigerian Light Gulf Nigerian Light Mobil Nigerian Medium Ninian Northwest Shelf Cond. Olmeca Oman Oriente Oseberg Oseberg Blend Palanca Pulai Qatar Land Qatar Marine Qua Iboe Rabi Rabi Export Blend Rabi Kounga Rabi Light Ras Budran Ras Gharib Ras Gharib Blend Rincon Rincon De Los Sauces Rio Negro Rostam Country United States United Kingdom United States Cameroon Abu Dhabi Gabon Angola Gabon Dubai Yemen United States Yemen Mexico Argentina Venezuela Indonesia Malaysia Malaysia Canada Sharjah Sharjah Abu Dhabi Abu Dhabi Congo Nigeria Nigeria Nigeria Nigeria Nigeria United Kingdom Australia Mexico Oman Ecuador Norway Norway Angola Malaysia Qatar Qatar Nigeria Gabon Gabon Gabon Gabon Egypt Egypt Egypt Argentina Argentina Argentina Iran Page H253 H249 H253 H65 H25 H103 H33 H105 H89 H275 H255 H277 H173 H43 H267 H125 H167 H167 H71 H233 H233 H15 H17 H85 H191 H183 H189 H193 H185 H241 H53 H175 H211 H91 H203 H203 H35 H169 H215 H217 H193 H107 H107 H107 H107 H95 H97 H97 H45 H45 H43 H135 Crude Oil Name Safaniyah Saharan Saharan Blend Salman Sarir Sassan Senipah Seria Light Export Blend Sharjah Condensate Shengli Siberian Light Sirri Sirri Heavy Sirtica SLC Sleipner Condensate Souedieh Soyo Statfjord Suez Blend Sumatran Light Sumatran Light Ex. Blend Suwaidiyah Syrian Export Blend Syrian Light Takula Tapis Tapis Blend Thamama Condensate Tia Juana Heavy Tia Juana Light Tia Juana Livano Tia Juana Pesado Troll Umm Shaif Upper Zakum Urals Vasconia Wafra Wanaea/Cossack West Texas Intermediate West Texas Sour White Tiger Widuri Widuri Blend WTI WTS Zaire Zakum Zarzaitine Zeit Bay Zueitina Country Saudia Arabia Algeria Algeria Iran Libya Iran Indonesia Brunei Sharjah China Russia Iran Iran Libya Indonesia Norway Syria Angola Norway Egypt Indonesia Indonesia Syria Syria Syria Angola Malaysia Malaysia Abu Dhabi Venezuela Venezuela Venezuela Venezuela Norway Abu Dhabi Abu Dhabi Russia Colombia Neutral Zone Australia United States United States Vietnam Indonesia Indonesia United States United States Zaire Abu Dhabi Algeria Egypt Libya Page H225 H29 H29 H135 H155 H135 H121 H61 H235 H75 H219 H137 H137 H157 H125 H205 H237 H37 H207 H99 H125 H125 H237 H239 H239 H33 H169 H169 H19 H269 H271 H271 H269 H209 H21 H23 H221 H81 H181 H47 H257 H259 H273 H127 H127 H257 H259 H279 H25 H31 H101 H159

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H13

ABU BUKHOOSH
Gravity: 31.5 Sulfur: 1.90 Other Names: ABK, Abu Bukoosh

Abu Dhabi
Loading Port: Abu al-Bukhoosh

Production About 35,000 barrels a day from an offshore field discovered in 1973. Output was 60,000 b/d in 1986 before platform was accidentally attacked in Iraq-Iran war. Restarted in spring of 1987. Quality A medium to heavy Mideast crude oil similar in quality to Arabian Medium. Producers Total-ABK: Total (operator) (75%) , Japan Indonesia Petroleum (25%). Previous share holders include Amerada Hess, Charter, and Kerr Mc-Gee. Pricing And Marketing Marketed mainly to Japan and other countries East of Suez by the equity producers and marketing intermediaries. Japan imported 28,000 b/d in 1995. No regular term-contract price determination by state Adnoc due to small volumes and dominant sales role of equity producers. Rarely moves to Atlantic Basin. Sellers Total Petroleum Services Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44171) 935-3222, Fax: (44-171) 935-3102. Main Customers Japanese trading houses and refiners. Loading Port Abu al-Bukhoosh. 25.29 N. 53.08 E. The crude oil-loading terminal is at the production platform and is capable of accommodating ships with a maximum of 300,000 deadweight tons and maximum draft of 22 meters. A 230,000 dwt tanker is used for storage, and vessels moor along side to load.

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 50 F Cut Points Temp. C/F <5/<41 5-85 41-185 85-165 185-329

ABU BUKHOOSH ASSAY Crude Oil Value Specifications 31.5 Sulfur Content 7.255 Pour Point 17.3 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 1.9 -27 3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 1.2 0.8 6.2 4.9 14.1 12.1 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Cetane Index Intermediate Gas Oil Sulfur Content Cetane Index Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt.

66 62 22 16 0.15 1.01 51.8 1.8 54 3.24 24/75.2 32 2 9 17 9

Kerosine Light Gas Oil

165-235 329-455 235-300 455-572 300-350 572-662 >350 >662

13.3 12.3

12.2 12

Int. Gas Oil

9.1

9.2

% Wt.

Residue

44.2

48.8

Year Of Crude Oil Sample: 1975

% Wt. Temp. C/F Cen at 210 F % Wt. % Wt. Parts/mill. Parts/mill.

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H15

MUBARRAZ
Gravity: 39.5 Sulfur: 0.90

Abu Dhabi
Loading Port: Mubarraz Island

Production Output of 15,000 barrels a day comes from a group of small producing fields off the coast of Abu Dhabi, just south of the major producing center at Zakum. Quality Extra-light Mideast crude oil similar in quality to Murban, Abu Dhabis benchmark grade. Producers Abu Dhabi Oil Co.: Cosmo (66.7%) ; Japan Energy Corp. (Nikko Kyodo) (33.3%). Pricing And Marketing Complete Japanese ownership in this tiny field translates into shipments that move almost exclusively to the owners. Pricing is internally generated but does take into account spot Oman and Dubai grades as well as the Asian Petroleum Price Index. Sellers Cosmo Tokyo: Toshiba Building, 1-1 Shibaura 1-chome, Minatoku, Tokyo, Japan 105. Tel.: (03) 3798-3211. Cosmo New York: 280 Park Ave., New York, NY 10017. Tel.: (212) 949-9710. Cosmo London: 7 Old Park Lane, London W1Y 3LJ, UK. Tel.: (44-171) 629-3031, Fax: (44-171) 491-3205. Main Customers The Japanese consortium rarely sells the barrels out of its own system. A few spot sales have gone to other Japanese firms. Loading Port Mubarraz Island. 24.26 N. 53.32 E. The island is located approximately 55 miles west of the port of Abu Dhabi. Tank storage on the island accommodates 2.238-million barrels of crude oil. Facilities for crude oil loading include a single-buoy mooring system installed about 8 miles offshore east of the island. The maximum loading rate is 40,000 barrels an hour, or 6,400 kiloliters/hr.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 50 F Cut Points Temp. C/F <32/<90 32-85 90-185 85-165 185-329 Yield % Vol. 0.8 7.7 18.5

MUBARRAZ ASSAY Crude Oil Value Specifications 39.5 Sulfur Content 7.64 Pour Point 11.8 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.9 -36 6.3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C.

65.8 68.6 19.4 12.6 0.08 0.9 -1 57 1.58 10 55.9 6.4 1.92 27/80.6 78 2.6

Kerosine Light Gas Oil

165-235 329-455 235-300 455-572

15.8 12.9

Int. Gas Oil

300-350 572-662

9.1

% Wt. Temp. C. 100 F % Wt. Temp. C/F Cen at 140 F % Wt.

Residue

>350 >662

35.2

Year Of Crude Oil Sample: 1994

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H17

MURBAN
Gravity: 40.4 Sulfur: 0.79 Other Names: Abu Dhabi

Abu Dhabi
Loading Port: Jebel Dhanna

Production Murbans output of 880,000-900,000 barrels a day comes from three main onshore fields: Bab, Bu Hasa, and Asab. Murbans total capacity is 1.3-million b/d following the expansion of the Bab field in 1994, and it accounts for most of the emirates shut-in production. Other than the Sahil field, the Murban stream provides the only onshore production in Abu Dhabi. Murban is the largest crude oil stream in the country. Quality A typical extra-light Mideast crude oil that is prized for its relatively low sulfur content by Mideast standards, large yield of middle distillates, and petrochemical-oriented naphtha cut. Producers Adco: State Adnoc (60%) , British Petroleum (9.5%) , Shell (9.5%) , Total (9.5%) , Exxon (4.75%) , Mobil (4.75%) , P&E (2%). Pricing And Marketing Abu Dhabi sets its crude prices retroactively, using published Dubai prices as a partial reference. Murban is the highest-priced Abu Dhabi export grade, selling at parity or slightly higher than Lower Zakum. It is marketed primarily in the Far East to a long list of Japanese term customers, which alone take some 500,000 b/d. However, many of these customers place Murban in the Mideast spot market, where five to 10 cargoes per month are actively traded. Sellers Adnoc: P.O. Box 270, Abu Dhabi, United Arab Emirates. Tel.: (971-2) 666-100, Fax: (971-2) 669-785. BP Oil International, Ltd.: Britannic House, 1 Finsbury Circus, London EC2M 7BA, UK, Tel.: (44-171) 496-4000. Shell International Trading & Shipping (Stasco) : Shell Mex House, Strand, London WC2R 07A, UK, Tel.: (44-171) 546-1234, Fax: (44-171) 546-4448. Total Petroleum Services, Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44171) 935-3102. Other equity producers. Main Customers Adnoc maintains at least 15 term customers for Murban, mostly in Japan and South Korea. The equity producers also regularly move volumes into their East of Suez refining systems. Loading Port Jebel Dhanna. 24.13 N. 52.40 E. There are 3 conventional-buoy mooring (CBM) berths at the crude oil terminal, each capable of accepting tankers up to 330,000 deadweight tons and 1,215 feet (370.3 meters) in length. Maximum loading rates range from 6,0009,500 tons/hour. Acceptable draft ranges from 45-49 ft. The terminal also has a single point mooring (SPM) that can accommodate vessels up to 450,000 dwt.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F

MURBAN ASSAY Crude Oil Value Specifications 40.4 Sulfur Content 7.66 Pour Point 2.9

Unit % Weight Temp. F

Value 0.79 0

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. Properties LPG 2.0 Light Naphtha 55-175 8.2 Light Naphtha Octane RON Int. Naphtha 175-300 15.4 Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha 300-400 12.5 Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine 400-500 12.1 Kerosine Sulfur Content Freezing Point Gas Oil 500-650 16.6 Gas Oil Sulfur Content Cetane Index Viscosity (Kin) Residue >650 33.2 Residue Sulfur Content Pour Point Year Of Crude Oil Sample: 1990 Viscosity (Kin) MURBAN TERM CONTRACT PRICES, 1986-93 At Port Of Loading In Dollars Per Barrel Month 1986 1987 1988 1989 1990 1991 Jan. $24.95 $17.85 $16.42 $15.20 $19.20 $20.70 Feb. 16.65 17.92 15.92 15.45 18.20 16.10 March 12.50 17.92 14.15 17.10 17.20 16.65 April 11.30 17.92 15.52 18.00 15.45 17.15 May 11.00 17.92 15.50 16.70 15.65 17.95 June 11.00 17.92 14.40 16.35 14.30 17.60 July 8.45 17.92 13.67 16.40 16.45 18.60 Aug. 13.85 17.92 13.77 16.00 27.00 18.90 Sept. 13.65 17.92 11.70 16.65 32.60 20.30 Oct. 13.85 17.92 10.81 17.15 34.34 21.10 Nov. 14.40 17.92 10.95 17.32 30.60 20.60 Dec. 15.55 17.92 13.25 18.35 25.55 17.35 Month Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. 1987 $17.65 17.50 17.55 17.70 17.70 17.80 18.10 17.85 17.50 17.60 17.40 16.35 1988 $16.15 15.85 13.90 15.50 15.45 14.30 13.65 13.70 12.20 10.80 11.15 13.25 MURBAN SPOT PRICES, 1987-93 1989 1990 1991 1992 $15.25 $19.10 $21.70 $17.40 15.55 18.65 15.75 17.60 16.95 17.25 15.95 17.40 18.05 15.50 16.70 18.30 16.75 15.50 17.60 19.25 16.60 14.50 17.30 20.60 16.45 16.60 18.45 20.05 15.85 25.80 18.95 19.40 16.50 31.75 20.05 20.15 17.10 34.00 21.35 20.00 17.25 30.70 20.60 18.80 18.55 25.70 17.65 18.05

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F. % Wt. 50 C % Wt. Temp. C/F Cst at 50 C

Value 64 64 22 14 55 24 21 0.11 -30 0.7 53 3.16 1.76 27/80 41.2

1992 $17.25 17.50 17.50 18.50 19.50 21.00 20.45 19.70 20.10 19.70 18.60 17.85 1993 $17.20 18.05 18.45 18.25 17.80 17.55 16.50 16.70 16.05 16.70 15.85 14.25

1993 $16.90 17.90 17.95 17.85 17.55 17.25 16.00 16.50 15.90 16.65 15.40 14.00

Note: More recent prices can be found in Chapter I.

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H19

THAMAMA CONDENSATE
Gravity: 57.5 Sulfur: 0.11

Abu Dhabi
Loading Port: Jebel Dhanna

Production A stream of condensate associated with the Thamama gas formations of the onshore Bab field. Following start-up in April of 1996, volumes were expected to rise to 130,000 barrels a day by year-end with total flows of 270,000 b/d expected when two further phases of development are completed. Quality A naphtha-oriented condensate that also produces a large amount of kerosine. Producers Adnoc by law owns all of the emirates gas resources and is managing the Thamama development on behalf of Adco, which operates the Bab field. Adcos ownership is as follows: State Adnoc (60%) , British Petroleum (9.5%) , Shell (9.5%) , Total (9.5%) , Exxon (4.75%) , Mobil (4.75%) , P&E (2%). Pricing And Marketing Adnoc plans to eventually refine all of the Thamama condensate at the nearby Ruwais refinery in order to maximize revenue, but until the plant is expanded to handle more of the condensate, it is selling most of the production on the international market. As of late 1996 it was in the process of lining up term customers. Most sales are expected to go to Asia, and Adnoc hopes to use a simple Murban-related pricing system, as with its other term crude oil contracts. Seller Adnoc: P.O. Box 270, Abu Dhabi, United Arab Emirates. Tel.: (971-2) 666-100, Fax: (971-2) 669-785. Loading Port Jebel Dhanna. 24.13 N. 52.40 E. There are 3 conventional-buoy mooring (CBM) berths at the crude oil terminal, each capable of accepting tankers up to 330,000 deadweight tons and 1,215 feet (370.3 meters) in length. Maximum loading rates range from 6,0009,500 tons/hour. Acceptable draft ranges from 45-49 ft. The terminal also has a single point mooring (SPM) that can accommodate vessels up to 450,000 dwt.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C

THAMAMA CONDENSATE ASSAY Crude Oil Value Specifications 57.5 Sulfur Content 8.42 Pour Point 0.76 Reid Vapor Press.

Unit % Weight Temp. F kg/cm2

Value 0.11 -39 4.8

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Naphtha <150 Kerosine 150-250 Gas Oil 250-395 Residue >395 Year Of Crude Oil Sample: 1996 Yield % Vol. % Wt. 1.04 1.02 56.46 52.69 25.04 26.51 14.58 16.31 2.93 3.47

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H21

UMM SHAIF
Gravity: 36.8 Sulfur: 1.38

Abu Dhabi
Loading Port: Das Island

Production About 180,000-200,000 barrels a day is produced from these offshore fields out of total capacity of 220,000 b/d. Capacity is due to rise to about 300,000 b/d shortly after 2000. Umm Shaif is tied in with the 20,000 b/d Al-Bunduq field production, which is slightly higher in quality. Quality A light to extra-light Mideast crude oil slightly inferior in quality to Abu Dhabi benchmark grade Murban. Although the assay below is dated, it is still broadly representative of the crude oils current quality. Producers Adma-Opco: State Adnoc (60%) , British Petroleum (14.66%) , Total (13.33%) , Jodco (12%). Pricing And Marketing Umm Shaif is exported almost exclusively to Japan, which imported 175,000 b/d in 1995. Prices are set retroactively every month by Adnoc, using the spot Dubai market as a rough guide. Sellers Adnoc: P.O. Box 270, Abu Dhabi, United Arab Emirates. Tel.: (971-2) 666-100, Fax: (971-2) 669-785. BP Oil International, Ltd.: Britannic House, 1 Finsbury Circus, London EC2M 7BA, UK. Tel.: (44-171) 496-4000. Total Petroleum Services, Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44171) 935-3222, Fax: (44-171) 935-3102. Main Customers Each of the sellers listed above markets barrels, which end up mainly with refiners in Japan. There are relatively few sales to Singapore and South Korea. Loading Port Das Island. 25.09 N. 52.52 E. Located approximately 100 miles northwest of the city of Abu Dhabi, the port has two crude oil-loading berths. Berth 2 is a fixed-platform berth located approximately 2,400 feet (750 meters) east of Das Island, with the capability of serving vessels up to 265,000 deadweight tons. Berth 3 is a single-point mooring (SPM) located approximately 7,500 ft (2,285 m) east of Das Island, with a maximum berthing draft of 72 ft (22 m) and maximum vessel size of 410,000 dwt. Total crude oil storage amounts to 8.9-million barrels in 15 tanks. There are plans to expand the terminal due to rising output capacity.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 10 C Cut Points Temp. C/F <32/<90 32-85 90-185 85-165 185-329

UMM SHAIF ASSAY Crude Oil Value Specifications 36.8 Sulfur Content 7.448 Pour Point 7.488 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 1.38 -15 6.2 20

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 3 2 Light Naphtha 8.8 7 Light Naphtha Octane RON Int. Naphtha 16.6 14.8 Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine 165-235 13.7 12.9 Kerosine 329-455 Sulfur Content Light Gas Oil 235-300 12.3 12.3 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 9 9.2 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 37.2 41.8 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1969 Nickel UMM SHAIF TERM CONTRACT PRICES, 1978-93 Prices At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 1981 1982 1983 Jan. $13.04 $13.78 $29.36 $36.36 $35.30 $34.36 Feb. 13.04 14.62 29.36 36.36 35.30 34.36 March 13.04 14.62 29.36 36.36 34.36 29.36 April 13.04 16.88 29.36 36.36 34.36 29.36 May 13.04 17.68 31.36 36.36 34.36 29.36 June 13.04 17.68 31.36 36.36 34.36 29.36 July 13.04 21.36 31.36 36.36 34.36 29.36 Aug. 13.04 21.36 31.36 36.36 34.36 29.36 Sept. 13.04 21.36 33.36 36.36 34.36 29.36 Oct. 13.04 21.36 33.36 36.36 34.36 29.36 Nov. 13.04 27.36 33.36 35.50 34.36 29.36 Dec. 12.65 27.36 33.36 35.50 34.36 29.36 Month 1986 1987 1988 1989 1990 1991 Jan. $24.75 $17.65 $16.22 $14.89 $18.75 $20.40 Feb. 16.40 17.72 15.72 15.15 17.80 15.80 March 12.25 17.72 13.85 16.83 16.85 16.35 April 11.05 17.72 15.25 17.73 15.10 16.85 May 12.10 17.72 15.25 16.35 15.30 17.65 June 10.75 17.72 14.12 16.00 13.95 17.30 July 8.25 17.72 13.36 16.07 15.10 18.30 Aug. 13.65 17.72 13.50 15.65 26.80 18.60 Sept. 13.40 17.72 11.47 16.27 32.25 20.00 Oct. 13.60 17.72 10.54 16.77 33.95 20.80 Nov. 14.20 17.72 10.65 16.94 30.25 20.30 Dec. 15.35 17.72 12.92 17.95 25.35 17.05
Note: More recent prices can be found in Chapter I.

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C. % Wt. Temp. C. 100 F % Wt. Temp. C/F Cen at 120 F % Wt. % Wt. Parts/mill. Parts/mill.

Value 66 62 16 22 0.15 0.6 -21 53 1.59 4 55.5 5.81 2.62 30/86 101 0.16 5.2 4 <1

1984 $29.36 29.36 29.36 29.36 29.36 29.36 29.36 29.36 29.36 29.36 29.36 29.36 1992 $16.95 17.20 17.20 18.20 19.20 20.70 20.15 19.40 19.80 19.40 18.30 17.55

1985 $29.11 28.05 28.05 28.05 28.05 28.05 28.05 28.05 28.05 28.05 28.05 28.05 1993 $16.55 17.55 17.55 17.45 17.15 16.85 15.60 16.10 15.50 16.25 15.00 13.55

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H23

UPPER ZAKUM
Gravity: 32.9 Sulfur: 1.78

Abu Dhabi
Loading Port: Das Island

Production Output is 450,000-470,000 barrels a day, with the upper limit reflecting full capacity, which is due to reach 500,000 b/d in 1997 as part of an ongoing expansion program. With reserves of 48-billion barrels, offshore Upper Zakum is Abu Dhabis largest field, although Murban output is higher, due in part to Upper Zakums relatively high production costs by Mideast standards. Quality A mid-grade Mideast sour crude oil that yields a generous middle distillate cut. Producers Zadco: State Adnoc (88%) , Jodco (12%). Operated by Total under a long-term service contract. Pricing And Marketing If not refined in Abu Dhabi, Upper Zakum is almost exclusively sold in the Far East, with Japan importing 240,000 b/d in 1995. Most Upper Zakum is sold on term contracts, making it one of Abu Dhabis least-traded spot crude oils. Term-contract prices are set retroactively every month by Adnoc, using the spot Dubai market as a rough guide. Sellers Adnoc: P.O. Box 270, Abu Dhabi, United Arab Emirates. Tel.: (971-2) 666-100, Fax: (971-2) 669-785. Total Petroleum Services, Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44171) 935-3222, Fax: (44-171) 935-3102. Main Customers Nippon Refining is the largest single user of Upper Zakum. It is also widely used throughout the Japanese refining community, as well as in South Korea and Singapore. Loading Port Das Island. 25.09 N. 52.52 E. Located approximately 100 miles northwest of the city of Abu Dhabi, the port has two crude oil-loading berths. Berth 2 is a fixed-platform berth located approximately 2,400 feet (750 meters) east of Das Island, with capability of serving vessels up to 265,000 deadweight tons. Berth 3 is a single-point mooring (SPM) located approximately 7,500 ft (2,285 m) east of Das Island, with a maximum berthing draft of 72 ft (22 m) and maximum vessel size of 410,000 dwt. Total crude oil storage amounts to 8.9-million barrels in 15 tanks. There are plans to expand the terminal due to rising output capacity.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 10 C Cut Points Temp. C/F <32/<90 32-85 90-185 85-165 185-329

UPPER ZAKUM ASSAY Crude Oil Value Specifications 32.9 Sulfur Content 7.32 Pour Point 17.7 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 1.78 -9 5.6

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 2.2 1.4 7.6 5.8 13.4 11.6 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C.

61 62 18 20 0.07 0.75 -27 53.4 1.63 3 55.5 5.44 2.14 18/64.4 153 3.7 9.3 12 17

Kerosine Light Gas Oil

165-235 329-455 235-300 455-572

13.2 11.5

12.2 11.2

Int. Gas Oil

300-350 572-662

9.0

9.0

% Wt. Temp. C. 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

43.5

48.8

Year Of Crude Oil Sample: 1983

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H25

ZAKUM
Gravity: 39.2 Sulfur: 1.10 Other Names: Lower Zakum

Abu Dhabi
Loading Port: Das Island

Production Output from this offshore field is about 240,000-250,000 barrels a day with total capacity of 280,000. Sustainable capacity is due to rise to 320,000 b/d in the future. All associated gas goes to the Das Island LNG plant. Quality Extra-light Mideast crude oil similar in quality to Abu Dhabi benchmark Murban. Producers Adma-Opco: State Adnoc (60%) , British Petroleum (14.66%) , Total (13.33%) , Jodco (12%). Pricing And Marketing Zakum is almost exclusively sold into the Far East under term contracts. Japanese refiners control 85%-90% of purchase volumes, but they have been known to trade Zakum outside Japan on occasion. Japan imported 217,000 b/d in 1995. Prices are set monthly on a retroactive basis by Adnoc using the spot Dubai market as the main reference level. Sellers Adnoc: P.O. Box 270, Abu Dhabi, United Arab Emirates. Tel.: (971-2) 666-100, Fax: (971-2) 669-785. BP Oil International, Ltd.: Britannic House, 1 Finsbury Circus, London EC2M 7BA, UK. Tel.: (44-171) 496-4000. Total Petroleum Services, Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44171) 935-3222, Fax: (44-171) 935-3102. Main Customers Japanese Idemitsu and Nippon Oil are the largest buyers, although Zakum is purchased by at least 10 other refineries in Japan. Loading Port Das Island. 25.09 N. 52.52 E. Located approximately 100 miles northwest of the city of Abu Dhabi, the port has two crude oil-loading berths. Berth 2 is a fixed-platform berth located approximately 2,400 feet (750 meters) east of Das Island, with capability of serving vessels up to 265,000 deadweight tons. Berth 3 is a single-point mooring (SPM) located approximately 7,500 ft (2,285 m) east of Das Island, with a maximum berthing draft of 72 ft (22 m) and maximum vessel size of 410,000 dwt. Total crude oil storage amounts to 8.9-million barrels in 15 tanks. There are plans to expand the terminal due to rising output capacity.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 10 C Cut Points Temp. C/F <32/<90 32-85 90-185 85-165 185-329

ZAKUM ASSAY Crude Oil Value Specifications 39.2 Sulfur Content 7.597 Pour Point 5.61 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 1.1 <-38 7.8 <3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 3.7 2.5 Light Naphtha 10.2 8.2 Light Naphtha Octane RON Int. Naphtha 17 15.4 Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine 165-235 14.5 13.9 Kerosine 329-455 Sulfur Content Light Gas Oil 235-300 13 13.1 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 9.1 9.5 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 33.1 37.4 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1980 Nickel ZAKUM TERM CONTRACT PRICES, 1978-93 Prices At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 1981 1982 1983 Jan. 13.17 14.01 29.46 36.46 35.40 34.46 Feb. 13.17 15.03 29.46 36.46 35.40 34.46 March 13.17 15.03 29.46 36.46 34.46 29.46 April 13.17 17.01 29.46 36.46 34.46 29.46 May 13.17 17.81 31.46 36.46 34.46 29.46 June 13.17 17.81 31.46 36.46 34.46 29.46 July 13.17 21.46 31.46 36.46 34.46 29.46 Aug. 13.17 21.46 31.46 36.46 34.46 29.46 Sept. 13.17 21.46 33.46 36.46 34.46 29.46 Oct. 13.17 21.46 33.46 36.46 34.46 29.46 Nov. 13.17 27.46 33.46 35.60 34.46 29.46 Dec. 13.08 27.46 33.46 35.60 34.46 29.46 Month 1986 1987 1988 1989 1990 1991 Jan. 24.85 17.75 16.32 14.97 18.95 20.55 Feb. 16.50 17.82 15.82 15.23 17.95 15.95 March 12.35 17.82 13.95 16.90 17.00 16.50 April 11.15 17.82 15.32 17.80 15.25 17.05 May ... 17.82 15.30 16.45 15.45 17.85 June ... 17.82 14.17 16.10 14.10 17.50 July ... 17.82 13.42 16.15 16.25 18.50 Aug. 13.75 17.82 13.58 15.75 26.65 18.80 Sept. 13.50 17.82 11.55 16.40 32.40 20.20 Oct. 13.75 17.82 10.61 16.90 34.10 21.00 Nov. 14.30 17.82 10.73 17.07 30.40 20.50 Dec. 15.45 17.82 13.00 18.10 25.20 17.25
Note: More recent prices can be found in Chapter I.

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C. % Wt. Temp. C. 50 C % Wt. Temp. C/F Cen at 50 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 72 64 18 18 0.03 0.5 -20 54.7 1.45 4 55.1 4.1 2.32 18/64.4 94.9 <0.05 6.1 4 6

1984 29.46 29.46 29.46 29.46 29.46 29.46 29.46 29.46 29.46 29.46 29.46 29.46 1992 17.15 17.40 17.40 18.40 19.40 20.90 20.35 19.60 20.00 19.60 18.50 17.75

1985 29.21 28.10 28.10 28.10 28.10 28.10 28.10 28.10 28.10 28.10 28.10 28.10 1993 16.80 17.80 17.85 17.75 17.45 17.15 15.90 16.40 15.80 16.55 15.30 13.90

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H27

ALGERIAN CONDENSATE
Gravity: 64.6 Sulfur: <0.01

Algeria
Loading Port: Arzew

Production State Sonatrach is the sole producer of some 300,000 barrels a day, all of which comes in association with gas production and is used almost entirely for export. Much of the gas is reinjected after the liquids are stripped out, but volumes have been in decline due to the decreasing proportion of wet gas in total gas output. Quality A naphtha-oriented condensate that produces large amounts of paraffinic naphtha in straight distillation, making it an excellent petrochemical feedstock. Pricing And Marketing Sold to the US, Brazil, and Europe mainly for petrochemical manufacturing. Prices are based on monthly negotiations and are usually tied to Rotterdam refined product markets, less a discount that is related to freight and quality. Almost all sales are on a termcontract basis. About 20-25 cargoes are exported per month, usually carrying 425,000 tons each, with the US Gulf Coast absorbing about half of them. Sonatrach handles all sales directly through its marketing department, but volumes are also sometimes available from an independent trading affiliate, Sonatrach Petroleum Corp. Sellers Sonatrach: Liquid Hydrocarbon Marketing Department, 46 Boulevard Mohamed V, Algiers, Algeria. Tel.: (213-2) 71-12-24, Fax: (213-2) 64-50-58, Telex: 62388 DZ. Main Customers Petrobras, Lyondell, Dow Chemical, OMV, and US Shell are among the regular term-contract customers. Loading Port Arzew. 35.50 N. 00.08 W. Arzew is located on the Algerian coastline about 200 miles west of Algiers and consists of the ports of Arzew and Arzew El Djedid. There are three crude oil or condensate loading berths at Arzew, with capacities from 50,000-120,000 deadweight tons. Arzew El Djedid has three crude oil-loading berths with maximum vessel size of 250,000 dwt. The port is prone to closure from storms, particularly in January and February.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 10 C Cut Points Temp. C/F <32/<90 32-85 90-185 85-165 185-329

ALGERIAN CONDENSATE ASSAY Crude Oil Value Specifications 64.6 Sulfur Content 8.724 Pour Point 0.91 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value <0.01 7 8.6

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 8.8 7.1 29.1 26.8 31.5 32.1 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

63 69 26 5 <0.01 -56 <0.01 -24 64.6 0.03 6 66.1 7.57

Kerosine

165-235 329-455 235-300 455-572

17.5

18.9

Light Gas Oil

8.5

9.6

Int. Gas Oil

300-350 572-662

4.7

5.5

% Wt. Temp. C 40 C

Year Of Crude Oil Sample: 1982 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. $14.20 $14.75 $36.00 Feb. 14.20 14.75 37.21 March 14.20 14.75 37.21 April 14.05 21.54 37.21 May 14.05 20.95 39.21 June 14.05 20.95 39.21 July 14.05 24.00 40.00 Aug. 14.05 24.00 40.00 Sept. 14.05 24.00 37.00 Oct. 14.05 26.22 37.50 Nov. 14.05 26.22 37.50 Dec. 14.05 30.40 37.50 Month 1986 1987 1988 Jan. $25.17 $17.50 $16.25 Feb. 25.17 16.15 15.85 March 13.50 17.25 14.90 April 13.25 18.10 16.45 May 14.55 17.40 16.90 June 12.00 18.40 15.75 July 9.55 19.00 14.55 Aug. 11.80 17.25 14.40 Sept. 12.60 17.10 13.60 Oct. 12.45 17.80 12.65 Nov. 13.00 16.95 13.40 Dec. 13.85 15.60 14.65
Note: More recent prices can be found in Chapter I.

ALGERIAN CONDENSATE TERM CONTRACT PRICES, 1978-93 1981 $41.00 41.00 41.00 39.00 39.00 39.00 35.50 35.50 35.50 35.50 36.70 36.70 1989 $16.65 16.15 17.60 18.50 17.85 18.00 16.95 15.50 17.05 16.35 17.35 19.00 1982 $36.00 33.00 35.50 30.00 30.00 33.00 33.00 31.50 31.50 32.50 32.50 32.50 1990 $19.90 19.50 18.05 16.55 15.95 15.00 17.00 28.60 36.20 35.46 32.60 28.55 1983 $31.00 31.00 30.50 28.00 29.00 29.00 29.75 29.75 30.25 30.00 29.25 28.50 1991 $25.45 20.25 20.05 20.10 20.70 19.75 20.20 19.85 19.00 21.05 23.45 19.60 1984 $27.50 28.25 28.25 28.50 28.50 28.50 27.50 26.00 26.65 27.00 26.50 25.00 1992 $18.85 19.05 18.95 20.25 21.00 20.86 21.03 20.50 20.75 21.59 19.96 18.78 1985 $25.00 25.00 29.50 26.89 26.89 26.89 26.89 26.55 26.55 27.46 27.46 27.23 1993 $18.85 18.83 18.97 20.45 19.33 19.36 18.71 18.61 17.58 18.04 15.32 14.81

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H29

SAHARAN BLEND

Algeria

Gravity: 46.1 Sulfur: 0.11 Loading Ports: Arzew, Bejaia, Skikda Other Names: Saharan, Arzew, Hassi-Messaoud Production About 700,000 barrels a day produced by state Sonatrach mainly from the mature HassiMessaoud field and others mostly to the south. This production is growing and is likely to reach 800,000 b/d or so in 1997 due to new capacity being brought on stream by international oil companies, including Italian Agip, Spanish Cepsa, Petro-Canada, US Anadarko. Quality An extremely light, low-sulfur crude oil that is rich in gasoline. Pricing And Marketing Sold to Europe and the US, with Italy and Spain the primary markets. Term-contract prices are set according to formulas tied to dated Brent with a premium. Sonatrach handles most sales directly through its marketing department, but volumes are also sometimes available from an independent trading affiliate, Sonatrach Petroleum Corp., which was established in the early 1990s to trade oil in the spot market. International equity producers have rights to market 20%-25% of their production directly, but they have not yet emerged as significant third-party sellers. Saharan Blend is also the primary feedstock for domestic refineries, which take about 350,000 b/d. Sellers Sonatrach: Liquid Hydrocarbon Marketing Department, 46 Boulevard Mohamed V, Algiers, Algeria. Tel.: (213-2) 71-12-24, Fax: (213-2) 64-50-58, Telex: 62388 DZ. Also, Agip, Cepsa, Petro-Canada, and Anadarko. Main Customers Mobil, Exxon, British Petroleum, Shell, Total, Ultramar, Elf, and OMV. Loading Ports Arzew. 35.50 N. 00.08 W. Arzew is located on the Algerian coastline about 200 miles west of Algiers and consists of the ports of Arzew and Arzew El Djedid. There are three crude oil-loading berths at Arzew, with capacities from 50,000-100,000 deadweight tons. Arzew El Djedid has three crude oil-loading berths with maximum size ranging to 250,000 dwt. The port is prone to closure from storms, particularly in January and February. Bejaia. 36.45 N. 05.05 E. Bejaia, located about 100 miles east of Algiers, has three crude oil-loading piers. The maximum drafts are 11.5 meters for Pier 1, 12.5 m for Pier 2, and 13 m for Pier 3. Skikda. 36.53 N. 6.54 E. Maximum draft for tankers is the following at New Port: NP 1 & 2, 12.8 m; NP 3, 14.8 m; NP 5, 10.5 m; A1, 10.5 m; M1, 11 m; M2, 12 m.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 10 C Cut Points Temp. C/F <32/<90 32-85 90-185 85-165 185-329

SAHARAN BLEND ASSAY Crude Oil Value Specifications 46.1 Sulfur Content 7.902 Pour Point 2.1 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.11 <-36 11.6

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 5.3 3.8 Light Naphtha 14.4 12.1 Light Naphtha Octane RON Int. Naphtha 21.7 20.3 Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine 165-235 15.8 15.8 Kerosine 329-455 Sulfur Content Light Gas Oil 235-300 12.2 12.8 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 7.9 8.6 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 23.1 26.6 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1983 Nickel SAHARAN BLEND PRICES, 1978-93 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 1981 1982 1983 Jan. $14.25 $14.81 $33.00 $40.00 $37.00 $37.30 Feb. 14.25 14.81 37.21 41.60 37.00 31.50 March 14.25 16.56 36.10 41.60 35.50 30.50 April 14.10 18.55 36.10 41.60 37.30 30.50 May 14.10 21.00 38.21 40.60 37.30 30.50 June 14.10 21.40 38.10 39.90 37.30 30.50 July 14.10 23.50 40.00 37.90 37.30 30.50 Aug. 14.10 23.50 40.00 37.90 37.30 30.50 Sept. 14.10 23.50 37.00 37.90 37.30 30.50 Oct. 14.30 26.27 37.00 37.90 37.30 30.95 Nov. 14.30 27.50 37.00 37.50 37.30 30.95 Dec. 14.30 30.45 38.60 37.50 37.30 30.95 Month 1986 1987 1988 1989 1990 1991 Jan. $27.90 $18.45 $16.75 $17.50 $21.65 $24.85 Feb. 23.90 18.87 15.70 17.30 20.20 21.05 March 23.90 18.87 14.80 19.05 18.65 20.45 April 23.90 18.87 16.70 20.60 16.75 19.85 May 13.80 18.87 16.55 19.05 16.60 19.65 June 11.90 18.87 15.75 17.90 15.10 18.70 July 9.45 18.87 15.30 17.90 17.25 20.05 Aug. 13.65 18.87 15.05 16.95 27.75 20.45 Sept. 14.20 18.87 13.50 17.90 36.45 21.45 Oct. 13.80 18.87 12.70 19.15 37.80 23.35 Nov. 14.50 18.87 13.25 19.05 34.40 22.35 Dec. 15.85 18.87 15.70 20.15 29.50 19.50

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 63 59 32 9 <0.01 0.04 -24 53.8 0.2 -2 56.7 6.09 0.33 24/75.2 43.9 0.28 3.1 <1 <1

1984 1985 $30.95 $30.95 30.95 28.65 30.95 29.50 30.95 29.50 30.95 29.50 30.95 29.50 30.95 27.90 30.95 27.90 30.95 27.90 30.95 27.90 30.95 27.90 30.95 27.90 1992 1993 $19.25 $17.80 19.30 18.90 18.45 19.10 19.60 19.05 20.50 18.85 21.55 17.70 20.70 17.30 20.20 17.35 20.65 16.60 20.95 17.10 19.95 15.80 18.95 14.20 Note: Spot prices from 2/86-2/87, and from 1/88 to present. Others are term-contract prices. Note: More recent prices can be found in Chapter I.

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H31

ZARZAITINE
Gravity: 42.8 Sulfur: 0.06 Other Names: Zarzatine, El Borma

Algeria
Loading Port: La Skhirra (Tunisia)

Production Declining output of less than 100,000 barrels a day by state Sonatrach, partly from the El Borma field that straddles the border with Tunisia and from the Zarzaitine field further south. Quality A high-quality North African light, sweet crude oil similar to Algerian benchmark grade Saharan Blend. Pricing And Marketing Although the crude oil stream is produced mainly in Algeria, it is sold from the Tunisian port of La Skhirra to save on pipeline-transport costs to Algerian ports. Only about 20,000 b/d of the Tunisian share of production is exported, and Algeria only sells an estimated 50,000 b/d internationally. The crude oil is sold to European customers, with Italy the main market. It is usually priced in relation to dated Brent. Sonatrach handles sales directly through its marketing department. Seller Sonatrach: Liquid Hydrocarbon Marketing Department, 46 Boulevard Mohamed V, Algiers, Algeria. Tel.: (213-2) 71-12-24, Fax: (213-2) 64-50-58, Telex: 62388 DZ. Loading Port La Skhirra, Tunisia. 34.14 N. 10.04 E. Two loading berths are available, one on each side of the terminal. Depth at loading berths is 15-16 meters. The loading platform is served by three 30-inch oil pipelines. The maximum loading rate is 12,000 cubic m an hour. Maximum size accommodated is 300 m length, 47 feet 6 in draft, or up to 50 ft at high water. The crude oil terminal has 1.9-million barrels of storage capacity and Paktank Mediterranee operates a near independent storage terminal for refined products.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F 55-175 175-300 Yield % Vol. 2.7 9.5 16.8

ZARZAITINE ASSAY Crude Oil Value Specifications 42.8 Sulfur Content 7.76 Pour Point 2.9 Reid Vapor Press.

Unit % Volume Temp. F Lbs/Sq. In.

Value 0.06 10 9

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F. % Wt. 50 C % Wt. Temp. F

66 66 35 9 53 33 14 0.02 -37 0.04 55 3.9 0.18 65

Heavy Naphtha

300-400

11.1

Kerosine

400-500

11.1

Gas Oil

500-650

15

Residue

>650

33.8

Year Of Crude Oil Sample: 1984

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H33

CABINDA
Gravity: 32.0 Sulfur: 0.13 Other Names: Malongo, Takula

Angola
Loading Port: Cabinda

Production Output of 390,000 barrels a day in 1995, rising to 430,000 b/d in 1996 and 450,000 b/d in 1998. Produced from two mainly offshore systems in the Cabinda enclave: Malongo and Takula. The two grades had been treated separately before commingling in May 1992. Quality Medium gravity, low-sulfur West African crude oil with high wax content. Malongo, which is shown in the assay below, is slightly heavier and higher in sulfur than the Takula stream or the now-commingled blend. The quality differential between the two was minor, typically only 5 a barrel. Takula is a 32.5-gravity stream with sulfur content of 0.11%, kinematic viscosity at 40 degrees centigrade of 13.9 centistokes, and pour point of 10 degrees centigrade. The crude oils high wax content makes it solidify at temperatures below 13-16 degrees centigrade and restricts sales destinations to warm seas or ports with heated tankage. Producers State Sonangol has a majority stake with partners Chevron (operator) , Elf, and Agip. Volumes in 1995 were about as follows: Sonangol 160,000 b/d; Chevron 152,000 b/d; Elf 39,000 b/d; and Agip 39,000 b/d. Pricing And Marketing Sonangol has sold most of its share of production under term contracts with prices set on a cargo-by-cargo basis and tied to spot prices of UK Brent Blend, with about twothirds moving to the US. Chevron and Agip tend to keep their crude oil within their own systems with only occasional spot sales. The oil increasingly moves to the Far East if arbitrage opportunities exist and both Taiwans CPC and South Korean Hanwha are among Asian refiners that now have term contracts. Key term customers include British Petroleum, Elf, Exxon, Petrobras, Coastal, and Glencore. Regular spot buyers include US refiners Sun and Tosco. Sellers Sonangol: Rua I Congresso do MPLA, C.P. 113, Luanda, Angola. Tel.: (244-2) 392643/392-595, Telex: 3148 SONONGAN. Chevron (UK) Ltd.: c/o Mail Centre, 2 Portman St., London W1H 0AN, UK. Tel.: (44171) 487-8100, Fax: (44-171) 487-8142. Agip Spa: 89-91 Via del Serafico, Rome 00142, Italy. Tel.: (39-6) 503-921, Fax: (39-6) 503-922-41/503-923-20. Elf Trading S.A.: P.O. Box 532 1215, Geneva 15 Airport, Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110. Loading Port Cabinda. 05.32 S. 12.11 E. The facilities at Cabinda provide for deep-water loading of crude oil at two single-buoy moorings, Berth M (Malongo) and Berth T (Takula) , 30 miles away. Berth M was expanded in 1992 to handle VLCCs, and it became the primary loading facility following the commingling of the Takula and Malongo crude oil streams.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <5/<41 5-85 41-185 85-165 185-329

CABINDA (MALONGO) ASSAY Crude Oil Value Specifications 31.4 Sulfur Content 7.247 Pour Point 17.5 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.17 21 4.5

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 1.5 0.9 4.9 3.8 9.9 8.6 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C

66 53 39 8 0.05 0.05 -19 54.2 0.11 4 58.7 5.92 0.21 39/102.2 34 0.2 4 27

Kerosine Light Gas Oil

165-235 329-455 235-300 455-572

9.2 10.3

8.5 9.9

Int. Gas Oil

300-350 572-662

8.2

8.1

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 100 C % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

56.4

60.2

Year Of Crude Oil Sample: 1981 At Port Of Loading In Dollars Per Barrel Month 1986 1987 1988 Jan. $25.15 $17.55 $15.25 Feb. 16.65 16.10 14.15 March 11.65 16.70 13.15 April 11.20 17.00 15.00 May 12.45 17.65 14.80 June 10.00 17.80 13.95 July 7.75 18.80 13.30 Aug. 11.95 18.05 13.35 Sept. 12.45 17.10 11.70 Oct. 12.80 17.60 10.85 Nov. 13.50 16.50 11.40 Dec. 14.85 15.70 13.55
Note: More recent prices can be found in Chapter I.

CABINDA SPOT PRICES, 1986-93 1989 $15.40 15.05 17.10 18.15 16.75 15.90 16.15 15.50 16.20 17.40 17.55 18.25 1990 $19.35 18.30 16.85 15.15 15.10 14.10 15.95 25.45 32.50 34.45 31.40 26.40 1991 $22.05 17.80 17.85 17.65 17.70 16.60 17.40 18.15 18.85 20.55 19.70 16.75 1992 $16.55 16.50 16.05 17.40 18.40 19.65 18.75 18.20 18.90 19.00 18.00 16.90 1993 $15.80 17.15 17.45 17.70 17.60 16.52 15.55 15.40 14.75 15.35 13.65 12.05

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H35

PALANCA
Gravity: 38.6 Sulfur: 0.14

Angola
Loading Port: Palanca

Production A combination of offshore fields south of the Soyo field that are operated by Elf, producing 175,000 barrels a day in 1996 and expected to rise to 190,000 b/d. In addition to Palanca itself, which is now mature, the other adjacent fields include Cobo, Oombe, and Pambi, which are providing a second production peak. Quality Lighter than Cabinda with a lower wax content and lower pour point. The crude oil also features a high N+A naphtha that is good for gasoline manufacturing. Producers Elf holds a 50% interest in the fields, with other holdings varying by field among state Sonangol, INA (Croatia) , Naftagas (Serbia) , Agip, Repsol, Svenska, and Mitsubishi. Pricing And Marketing Palanca is sold using a dated Brent-related formula, usually with a slight premium to the North Sea benchmark grade. Export volumes flow mainly toward the Atlantic Basin, but increasing sales have been made to the Asia-Pacific region. Asian customers include Taiwans state CPC and Thailands state PTT. Sellers Elf Trading S.A.: P.O. Box 532 1215, Geneva 15 Airport, Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110. Sonangol: Rua I Congresso do MPLA, C.P. 113, Luanda, Angola. Tel.: (244-2) 392643/392-595, Telex: 3148 SONONGAN. Agip Spa: 89-91 Via del Serafico, Rome 00142, Italy. Tel.: (39-6) 503-921, Fax: (39-6) 503-922-41/503-923-20. Loading Port Palanca. 06.57S. 12.24E. The terminal is located at the offshore Palanca field some 230 km northwest of Luanda. It consists of a single loading point mooring that is supplied by a 274,000 deadweight tons floating storage vessel that gathers all of the production. Tankers from 40,000 to 280,000 dwt can be accommodated.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F 55-175 175-300 Yield % Vol. 2.6 6.8 13.7

PALANCA ASSAY Crude Oil Value Specifications 38.6 Sulfur Content 7.57 Pour Point 3.6

Unit % Weight Temp. F

Value 0.14 35

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F. % Wt. 50 C % Wt. Temp. F Cst at 50 C

70 48 42 10 41 46 13 0.02 -40 0.1 52 3.26 0.25 68 66.8

Heavy Naphtha

300-400

10.4

Kerosine

400-500

12.3

Gas Oil

500-650

16.6

Residue

>650

37.6

Year Of Crude Oil Sample: 1989

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H37

SOYO
Gravity: 39.5 Sulfur: 0.12

Angola
Loading Port: Quinfuquena

Production A combination of onshore and offshore flows totaled 90,000-100,000 barrels a day from northern Angola in mid-1996, with volumes expected to rise to about 120,000-130,000 b/d in 1997 with full restoration of onshore production of 30,000 b/d, which was shutdown due to the civil war. Texaco produces 90,000 b/d offshore, with Essungo and Lombo East the largest of the fields but several small new fields raising total volumes. Petrofina is the onshore operator. Quality Similar to Palanca with low sulfur content and relatively light compared to Cabinda. The assay below is for the offshore production. Onshore output is a bit heavier, which should degrade the quality of the stream as it picks up in 1996-97. Producers Braspetro (27.5%) , Total (27.5%) , Sonangol (25%) , and Texaco (20%) hold the offshore concession. Petrofina (32.6%) , Texaco (16.4%) , and Sonangol (51%) hold the onshore area. Pricing And Marketing Soyo is sold using a dated Brent-related formula, with volumes mainly flowing toward the Atlantic Basin, but sales have also grown to the Asia-Pacific region. Texaco and Sonangol are the largest spot sellers of Soyo, while the other equity partners tend to use their shares within their systems. Sellers Sonangol: Rua I Congresso do MPLA, C.P. 113, Luanda, Angola. Tel.: (244-2) 392643/392-595, Telex: 3148 SONONGAN. Texaco Oil Trading Co.: 1 Knightsbridge Green, London SW1X 7QJ, UK. Tel.: (44171) 584-5000, Fax: (44-171) 589-2877. Loading Port Quinfuquena. 06.20 S. 12.14 E. The terminal is 15 miles south of the mouth of the Zaire River, about 7.5 nautical miles offshore. It consists of two loading points. The first is a ready-made dolphin in about 72 feet of water at Lat. 6 19 45 S., Long. 12 14 42 E. Maximum draft is 47 ft and maximum cargo size is 104,500 tons. The second is a singlepoint mooring in 120 ft of water at Lat. 6 20 18 S., Long. 12 09 48 E. It takes tankers up to 250,000 deadweight tons. The onshore terminal was destroyed in the civil war and is unlikely to be rebuilt.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F To 180 180-265

SOYO ASSAY Crude Oil Value Specifications 39.5 Sulfur Content 7.615 Pour Point 6.4 Reid Vapor Press.

Unit % Weight Temp. F Lbs/Sq. In.

Value 0.115 30 5.5

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 2.7 1.8 5.9 4.8 8.2 7.6 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Light Kerosine Sulfur Content Freeze Point Heavy Kerosine Sulfur Content Freeze Point Gas Oil Cloud Point Cetane Index Sulfur Content Residue Sulfur Content Pour Point Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. F % Wt. F Temp. F % Wt. % Wt. Temp. C/F

69.6 53 38 9 50 28 22 0.02 -50 0.03 -25 26 62 0.08 0.24 39/102.2

Heavy Naphtha

265-350

9.6

9.1

Light Kerosine

350-425

7.2

Heavy Kerosine

425-500

9.3

9.2

Gas Oil

500-650

15.9

16.1

Residue

>650

41.2

44.6

Year Of Crude Oil Sample: 1993

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H39

CANADON SECO
Gravity: 25.7 Sulfur: 0.20

Argentina
Loading Ports: Celeta Olivia, Celeta Cordova

Production Canadon Seco is produced from long-established onshore fields in the province of Santa Cruz, which is in the southern Patagonian region. The key producing area is the San Jorge Basin, which contains about 25% of the countrys proven reserves. Some fields from the extreme south also feed into Canadon Seco. Exports in 1996 were just under 90,000 b/d, making it Argentinas second most plentiful grade behind Rincon. Quality A medium- to heavy-gravity, low-sulfur Latin American crude oil with a relatively high wax content. Producers In addition to former state YPF, which is the primary exporter, local independents Astra and Perez Companc are producers and sellers of the crude oil. Pricing And Marketing Usually sold on an f.o.b. basis from Argentina at prices linked to US West Texas Intermediate grade. In the autumn of 1996, the discount to WTI was running at about $2.50 a barrel, up from 1994-95 levels. Exports in 1996 had risen to 87,000 b/d, up from 75,000 b/d in 1995 and 50,000 b/d in 1994, with most supplies going to Brazil, Chile, and the US Gulf Coast. Traders play an active role in the marketing of the crude oil. Sellers YPF: 777 Avenue Pte. Roque Saenz Pena, Buenos Aires, Argentina. Tel.: (541) 3292000. Fax: (541) 326-0641. Loading Ports Celeta Olivia. 46.26 S. 67.31 W. A crude oil-loading terminal located on the coast of the south Atlantic, about 1,000 miles south of Buenos Aires, on the San Jorge Gulf, in the port area of Comodoro Rivadavia. The oil terminal consists of two offshore tanker berths and a single-buoy mooring at a depth of 22 meters. It is capable of handling vessels up to 150,000 deadweight tons. Celeta Cordova. 45.46 S. 67.22 W. A crude oil-loading terminal located on the coast of the south Atlantic, about 1,000 miles south of Buenos Aires, on the San Jorge Gulf, in the port area of Comodoro Rivadavia. The oil terminal consists of an offshore tanker berth at a depth of 43 feet.

H40

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 20/40 C Cut Points Temp. C <145 145-250 Yield % Vol. 0.05 9.83 14.37

CANADON SECO ASSAY Crude Oil Value Specifications 25.7 Sulfur Content 7 Pour Point 99.4 Reid Vapor Press. Wax Content

Unit % Weight Temp. C Lbs/Sq. In. % Weight

Value 0.2 -0.3 1.51 9.8

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Naphtha Kerosine Properties LPG Naphtha Octane Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Pour Point Cetane Index Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Vanadium Nickel Unit Value

RON Parts/mill. Temp. C % Wt. Temp. C

44 33.91 -56 0.07 -9 56.1 0.321 36 460/18.4 2.57 2.45 2.55

Gas Oil

230-360

19.6

Residue

>370

58.23

Year Of Crude Oil Sample: 1995

% Wt. Temp. C Cen at 50/100 C % Wt. Parts/mill. parts/mill.

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H41

ESCALANTE
Gravity: 24.1 Sulfur: 0.19

Argentina
Loading Port: Bahia Blanca

Production Output comes from a group of onshore fields located in the Rio Negro and Neuquen provinces in central Argentina. Most of the output is used in local refineries, with exports of about 50,000 b/d in 1996. Quality A medium- to heavy-gravity crude oil that is relatively low in sulfur, similar to Ecuadors Oriente. Producers In addition to former state YPF, local independent Perez Companc also produces and sells the crude oil. Pricing And Marketing Usually sold on an f.o.b. basis from Argentina at prices linked to US West Texas Intermediate grade. In 1996, the discount to WTI was running at about $3.40-$3.50 a barrel. The primary markets for the 50,000 b/d of exports in 1996 were Brazil and the US. Sellers YPF: 777 Avenue Pte. Roque Saenz Pena, Buenos Aires, Argentina. Tel.: (541) 3292000. Fax: (541) 326-0641. Loading Port Bahia Blanca. 39.03 S. 61.50 W. The port, about 300 miles southwest of Buenos Aires, contains a crude oil-loading terminal consisting of two loading points in water depths of 18-29 meters. The terminal has 500,000 barrels of storage.

H42

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Viscosity (Kin)

Unit API cts at 100F

ESCALANTE ASSAY Crude Oil Value Specifications 24.1 Sulfur Content 307.2 Pour Point Reid Vapor Pressure

Unit % Weight Temp. F psi

Value 0.19 30 1.4

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Cut Points Temp. F <55 55-165 165-220 Yield % Vol. % Wt. 0.04 0.02 1.97 1.46 2.57 4.58 Properties LPG Light Naphtha Reid Vapor Pressure Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Pour Point Intermediate Gas Oil Sulfur Content Pour Point Viscosity (kin) Residue Sulfur Content Pour Point Viscosity (Kin) Conradson Carbon R Vanadium Nickel Unit Value

psi % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. ppm ppm Temp. F % Wt. Temp. F cts at 100 F % Wt. Temp. F Cen at 100 F % Wt. Parts/mill. Parts/mill.

12.8 67 31 2 65 29 5 35 254 -30 0.07 20 4.47 0.24 90 12367 10.63 2.2 1.9

Heavy Naphtha

220-300

2.45

Kerosine Light Gas Oil

300-400 400-525

5.08 8.84

4.33 8.04

Int. Gas Oil

525-600

5.44

5.09

Residue

>600

73.5

76.8

Year Of Crude Oil Sample: 1992

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H43

MEDANITO
Gravity: 35.1 Sulfur: 0.431 Other Names: Rio Negro

Argentina
Loading Port: Bahia Blanca

Production The countrys primary crude oil stream, with production of about 300,000 barrels a day. But most of this oil is consumed at domestic refineries. Output comes from the large Neuquen province in the central, western part of the country near the border with Chile. The provinces of Rio Negro and La Pampa also contribute smaller volumes to the Medanito stream. Quality A medium- to light-gravity crude oil that is relatively low in sulfur, making it attractive for most refiners. Producers In addition to former state YPF, local independents Pluspetrol and Perez Companc are producers and sellers of the crude oil. Pricing And Marketing Usually sold on an f.o.b. basis from Argentina at prices linked to US West Texas Intermediate grade. In 1996, the discount to WTI was running at about $1.75 a barrel, a bit narrower than in 1994-95. The new 100,000 b/d Trans-Andean export pipeline to Chile is also taking some Medanito. In 1996, Medanito exports were running at about 30,000 b/d, down slightly from 1994 levels. Most of these exports go to Brazils state Petrobras or US Gulf Coast refiners. Sellers YPF: 777 Avenue Pte. Roque Saenz Pena, Buenos Aires, Argentina. Tel.: (541) 3292000. Fax: (541) 326-0641. Loading Port Bahia Blanca. 39.03 S. 61.50 W. The port, about 300 miles southwest of Buenos Aires, contains a crude oil-loading terminal consisting of two loading points in water depths of 18-29 meters. The terminal has 500,000 barrels of storage.

H44

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Viscosity (Kin)

Unit API cts at 100F

MEDANITO ASSAY Crude Oil Value Specifications 35.1 Sulfur Content 6 Pour Point Reid Vapor Pressure

Unit % Weight Temp. F psi

Value 0.431 30 3.1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Cut Points Temp. F <80 80-160 160-220 Yield % Vol. % Wt. 1.22 0.87 4.19 3.31 5.57 4.75 Properties LPG Light Naphtha Octane Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

RON % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F

70 56 37 7 51 35 14 0.03 0.1 10 51.8 0.3 48 50.7 0.77 90 94.5 1.22 5.79 15 6

Heavy Naphtha

220-300

8.75

7.7

Kerosine Light Gas Oil

300-480 480-600

19.08 12.94

18.01 12.83

Int. Gas Oil

600-660

6.63

6.75

% Wt. Temp. F

Residue

>660

41.4

45.5

Year Of Crude Oil Sample: 1995

% Wt. Temp. F Cen at 150 F % Wt. % Wt. Parts/mill. Parts/mill.

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H45

RINCON
Gravity: 36.1 Sulfur: 0.28 Other Names: Rincon De Los Sauces

Argentina
Loading Port: San Vincente, Chile

Production The countrys primary export crude oil stream, with international sales of about 95,000 b/d in 1996. Production is from fields that lie in the Andes foothills and feed into both domestic pipelines and the Trans-Andean pipeline to Chile. Quality The highest-quality Argentine export grade is fairly light and sweet, with good yields of gasoline and mid-distillates. Producers In addition to former state YPF, local independents are also producers and sellers of the crude oil. Pricing And Marketing Exports of about 95,000 b/d move west to Chile via the 100,000 b/d Trans-Andean pipeline, and most of the crude oil is used in Chile. Some 5,000-10,000 b/d of the grade moves from Chile to the Far East, but these volumes are down from 1995 levels. Prices are linked to WTI with a discount of about $1 a barrel in 1996. Sellers YPF: 777 Avenue Pte. Roque Saenz Pena, Buenos Aires, Argentina. Tel.: (541) 3292000. Fax: (541) 326-0641. Loading Port San Vincente Terminal (Chile). 36.44 S. 73.09 W. The port lies south of Valaparaiso on the Pacific coast of Chile. The Trans-Andean pipeline terminates at the loading port, which has 1-million barrels of storage capacity. The terminal can handle vessels up to 70,000 deadweight tons at a single berth with maximum draft of 43 feet. Larger tankers can be loaded through top-off operations in Conception Bay.

H46

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Viscosity (Kin) Hydrogen Sulfide

Unit API cts at 100F ppm

RINCON ASSAY Crude Oil Value Specifications 36.1 Sulfur Content 4.86 Pour Point <1 Reid Vapor Pressure

Unit % Weight Temp. F psi

Value 0.28 25 <0.2

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Cut Points Temp. F <160 160-220 Yield % Vol. % Wt. 0.36 0.26 4.05 3.09 4.09 3.51 Properties LPG Light Naphtha Octane Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

RON % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F

73 56 36 8 52 31 16 0.02 0.08 8 52.6 0.25 48 51.5 0.6 90 60.15 0.93 4.66 10 3.6

Heavy Naphtha

220-300

9.1

8.2

Kerosine Light Gas Oil

300-480 480-600

22 15.27

21 15.19

Int. Gas Oil

600-660

6.82

6.97

% Wt. Temp. F

Residue

>660

37.8

41.4

Year Of Crude Oil Sample: 1994

% Wt. Temp. F Cen at 150 F % Wt. % Wt. Parts/mill. Parts/mill.

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H47

COSSACK
Gravity: 47.0 Sulfur: 0.03 Other Names: Wanaea/Cossack

Australia
Loading Port: Cossack FPSO

Production The two Northwest Shelf fields, Wanaea and Cossack, began production in late 1995 from an FPSO (floating production, storage, and offloading) vessel and quickly reached peak flows of 115,000 barrels a day. However, output has been disrupted at times by severe storms, which make the offshore production system vulnerable to disruption. The crude oil is offloaded. Quality A high-quality Asia-Pacific light, sweet crude oil excellent for gasoline manufacture, but with a relatively high wax content. Its residue is excellent cracker feedstock. It is similar to Gippsland and Papua New Guineas Kutubu grade. Producers The fields are operated by Woodside Petroleum and are owned by the same group of firms that hold the nearby Northwest Shelf LNG project: Woodside, Shell, Chevron, BP, BHP, and the Japanese Mimi consortium. All firms have equal shares. Pricing And Marketing The grade is sold by all of the partners into Asian and US West Coast export markets and is also used in Australia as a replacement for declining Gippsland production. Japanese refiners were some of the first buyers of the grade. Sellers Woodside Petroleum Ltd.: G.P.O. Box 839J, Melbourne, VIC 3001, Australia. Tel.: (61-3) 9605-0605, Fax: (61-3) 9602-5621. BHP Petroleum Pty. Ltd.: BHP Petroleum Plaza, 120 Collins St., Melbourne, VIC 3000, Australia. Tel.: (61-3) 9652-6666, Fax: (61-3) 9652-6693. Other marketing offices: Singapore: (65) 539-8410; Houston: (1-713) 961-8668; London: (44-171) 408-7116; Tokyo: (813) 5251-1371. BP Developments Australia: 1 Albert Road, Melbourne, VIC 3000, Australia. Tel.: (61-3) 9268-4111. Chevron Asiatic Ltd.: 385 Bourke St., Melbourne, VIC 3000, Australia. Tel.: (61-3) 9670-5511. Shell Development (Australia) : 1 Spring St., Melbourne, VIC 3000, Australia. Tel.: (61-3) 9666-5444. Loading Port Cossack Pioneer FPSO 19.35 S 116.26 E. The floating production unit at the Cossack field has storage capacity of 1-million barrels of crude oil and can accommodate tankers up to 150,000 dead-weight tons.

H48

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C <70 70-140

COSSACK ASSAY Crude Oil Value Specifications 47.3 Sulfur Content 7.965 Pour Point 1.45 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.03 -18 6.4

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 2.56 8.8 7.2 23.9 22.3 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cloud Point Cetane Index Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

69.6 52 44 3 50 39 11 <0.01 -44 0.03 -5 51.7 0.17 39 17.9 0.3 2.2

Heavy Naphtha

140-190

13.1

12.9

Kerosine

190-230

9.1

Gas Oil

230-360

25.5

27.2

Residue

>360

16.8

19.2

Year Of Crude Oil Sample: 1995

% Wt. Temp. C Cen at 70 C % Wt. % Wt.

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H49

GIPPSLAND
Gravity: 47.0 Sulfur: 0.09 Other Names: Gippsland Blend, Bass Strait

Australia
Loading Port: Westernport

Production Some 20 offshore fields provided a combined 228,000 barrels a day in 1995 from the Bass Strait area, which lies between the southern coast of Victoria and the island of Tasmania. The area is mature, and output peaked in 1985 at about 500,000 b/d, but the decline has been slowed by enhanced recovery and development of small satellite fields. Gippsland is still Australias primary crude oil stream, and it is expected to produce about 200,000 b/d through 2000. Quality A high-quality Asia-Pacific light, sweet grade excellent for gasoline manufacture, but with a relatively high wax content. Its residue is excellent cracker feedstock. Producers Exxon is the operator and equal partner with BHP in all of the fields. Pricing And Marketing Most of this crude oil is now used locally in Australia with an occasional international spot sales. Neither Exxon nor BHP has downstream networks in Australia, and they resell the oil to domestic refineries, usually at prices linked to Malaysian Tapis Blend. Sellers Exxon Australia Ltd.: 360 Elizabeth St., Melbourne, Victoria 3000, Australia. Tel.: (61-3) 9270-3333, Fax: (61-3) 9270-3898. BHP Petroleum Pty. Ltd.: BHP Petroleum Plaza, 120 Collins St., Melbourne, Victoria 3000, Australia. Tel.: (61-3) 9652-6666, Fax: (61-3) 9652-6693. Other marketing offices: Singapore: (65) 539-8410; Houston: (1-713) 961-8668; London: (44-171) 408-7116; Tokyo: (813) 5251-1371. Loading Port Westernport. 38.21 S. 145.14 E. The Westernport terminal consists of three crude oilloading berths, two at Crib Point Jetty and one at Long Island Jetty. No. 1 Crib Point can accommodate 100,000-ton tankers with a depth of 15.8 meters. No. 2 Crib Point takes up to 40,000-ton tankers with a depth of 12.8 m. The loading berth at Long Island Jetty accommodates tankers up to 100,000 tons.

H50

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 20 C Cut Points Temp. C/F 70-165 158-329

GIPPSLAND ASSAY Crude Oil Value Specifications 47 Sulfur Content 7.952 Pour Point 2.509 Wax Content

Unit % Weight Temp. C % Weight

Value 0.09 9 7.6

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Naphtha Yield % Vol. % Wt. 26.5 25 Properties Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Gas Oil Sulfur Content Cloud Point Cetane Index Residue Sulfur Content Pour Point Conradson Carbon R Unit % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C Value 50.3 42.9 6.8 0.04 0.1 8 52.9 0.26 48 1.6

Kerosine Gas Oil

165-240 329-464 240-360 464-680

15 25.8

15.1 27.6

Residue

>360 >680

19.7

21.8

Year Of Crude Oil Sample: 1993

% Wt. Temp. C % Wt.

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H51

GRIFFIN
Gravity: 55.0 Sulfur: 0.03

Australia
Loading Port: Griffin FPSO

Production About 80,000 barrels a day is produced from this offshore oil and gas field which lies just south of the main gas fields on the Northwest Shelf. The production is from a floating production, storage and offloading unit, which must be disconnected during severe storms. This causes occasional disruptions to production flows. Quality A high-quality Asia-Pacific light, sweet crude oil with high yields of naphtha and high quality middle distillates. Producers The fields are operated by BHP Petroleum, which holds a 45% stake along with Mobil (35%) and Inpex Alpha (20%). Pricing And Marketing The crude oil is sold by the partners independently into the Australian market and to Asian and US export markets. It is also used in Australia as a replacement for declining Gippsland production. Sellers BHP Petroleum Pty. Ltd.: BHP Petroleum Plaza, 120 Collins St., Melbourne, VIC 3000, Australia. Tel.: (61-3) 9652-6666, Fax: (61-3) 9652-6693. Other marketing offices: Singapore: (65) 539-8410; Houston: (1-713) 961-8668; London: (44-171) 408-7116; Tokyo: (813) 5251-1371. Mobil Sales & Supply Corp., Singapore: 18 Pioneer Road, 2262 Singapore. Tel.: (65) 660-6401, Fax: (65) 264-1693. Loading Port Griffin Venture FPSO 21.13 S. 114.38 E. The floating production unit at the Griffin field has storage capacity of 820,000 barrels of crude oil and can accommodate tankers up to 150,000 deadweight tons.

H52

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 20 C Cut Points Temp. C/F <70 <158

GRIFFIN ASSAY Crude Oil Value Specifications 55 Sulfur Content 8.3 Pour Point 1.24 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.03 -48 5.4

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Yield % Vol. % Wt. 8.6 7.4 Properties Light Naphtha Octane Paraffins Naphthenes Aromatics Int. Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cloud Point Cetane Index Pour Point Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Unit RON % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C Temp. C % Wt. Temp. C Cen at 50 C % Wt. % Wt. Value 68 96 4 0 50 39 11 <0.01 -51 0.08 -3 53.4 -3 0.14 27 28.7 0.4 2.1

Int. Naphtha

70-135 158-275

30.2

28.4

Kerosine

135-270 275-518 270-360 518-680

39.9

41.1

Gas Oil

11.6

13

Residue

>360

16.8

19.2

Year Of Assay: 1991 Year Of Crude Oil Sample: 1995

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H53

NORTHWEST SHELF CONDENSATE


Gravity: 59.5 Sulfur: <0.01

Australia
Loading Port: Withnell Bay

Production Condensate output of 80,000 barrels a day from the North Rankin and Goodwyn fields is associated with gas output for liquefied natural gas exports. Volumes rose sharply in 1995 with the addition of Goodwyn A supplies. Quality A very light, gasoline-rich condensate that is not as middle distillate-oriented as Indonesian Arun Condensate, the main regional grade. Producers The partners of the Northwest Shelf LNG project share the condensate in the same proportions as the gas. They are Woodside, BHP, Chevron, Shell, British Petroleum, and Japanese Mimi (Mitsubishi-Mitsui). They all have equal shares. Pricing And Marketing The firms sell their output individually except for Mimis volumes, which have been handled by BHP. BP is the only producer to take volumes for its domestic refining system, with the rest exported, mainly to Japan, South Korea, and Taiwan. Sellers Woodside Petroleum Ltd.: G.P.O. Box 839J, Melbourne, Victoria 3001, Australia. Tel.: (61-3) 9605-0605, Fax: (61-3) 9602-5621. BHP Petroleum Pty. Ltd.: BHP Petroleum Plaza, 120 Collins St., Melbourne, Victoria 3000, Australia. Tel.: (61-3) 9652-6666, Fax: (61-3) 9652-6693. Other marketing offices: Singapore: (65) 539-8410; Houston: (1-713) 961-8668; London: (44-171) 408-7116; Tokyo: (813) 5251-1371. BP Developments Australia: 1 Albert Road, Melbourne, Victoria 3000, Australia. Tel.: (61-3) 9268-4111. Chevron Asiatic Ltd.: 385 Bourke St., Melbourne, Victoria 3000, Australia. Tel.: (613) 9670-5511. Shell Development (Australia) : 1 Spring St., Melbourne, Victoria 3000, Australia. Tel.: (61-3) 9666-5444. Loading Port Withnell Bay. 20.35 S. 116.45 E. The Withnell Bay terminal is part of the port of Dampier and is operated by Woodside for the loading of LNG and some oil production. Tankers from 20,000 deadweight tons to 150,000 dwt can be accommodated and total storage amounts to 1.8-million barrels.

H54

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

NORTHWEST SHELF CONDENSATE ASSAY Crude Oil Unit Value Specifications API 59.5 Sulfur Content /Metric Ton 8.5 Pour Point Centistokes 0.789 Reid Vapor Press. at 20 C REFINED PRODUCT BREAKDOWNS AND PROPERTIES Cut Points Temp. C/F <70 <158 Yield % Vol. % Wt. 24.6 21.7

Unit ppm Temp. C Lbs/Sq. In.

Value 120 <-48 8.8

Product Light Naphtha

Int. Naphtha

70-140 158-284

37.6

37.9

Kerosine

140-290 284-554 >290

28.4

31

Residue

4.6

5.4

Year Of Assay: 1995 Year Of Crude Oil Sample: 1995

Properties Light Naphtha Octane Paraffins Naphthenes Aromatics Int. Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Residue Sulfur Content Pour Point Viscosity (Kin)

Unit RON % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. ppm Temp. C ppm Temp. C Cen at 40 C

Value 75.3 90 9 1 42 52 6 <3 -47 580 -15 8.9

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H55

BRUNEI CONDENSATE
Gravity: 66.5 Sulfur: <0.01

Brunei
Loading Port: Seria

Production Output of about 20,000 barrels a day in conjunction with gas supply to a liquefied natural gas export plant. Quality Similar in quality to Indonesian Arun Condensate, with large yields of naphtha and gas oil. The naphtha is well suited for gasoline manufacturing. Producers Brunei Shell Petroleum, a 50/50 joint venture between the government and the Royal Dutch/Shell Group, is the sole producer. Pricing And Marketing All sales are handled by Brunei Shell independently of Shell International. Most sales are on a term-contract basis to Japan, with prices set retroactively every month. Light Southeast Asian spot-traded crude oils and Arun Condensate are used as pricing reference points. Spot deals are sporadic, with Australia and the US West Coast the main destinations. Sellers Brunei Shell Petroleum Co. Ltd.: RBA Plaza Jalan Sultan, 2nd Floor, Bandar Seri Begawan 1999, Negara Brunei Darussalam. Tel.: (673-2) 29269, Fax: (673-2) 41417, Telex: BU 2573. Loading Port Seria. 04.43 N. 114.19 E. The Seria terminal is an open-sea berth consisting of two single-buoy moorings located approximately 5.4 miles off the coast. Size restrictions are the following: 313,000 deadweight tons and maximum draft 15.8 meters at SBM 1; 200,000 dwt and maximum draft 17 m at SBM 2.

H56

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <85 <185 85-165 185-329

BRUNEI CONDENSATE ASSAY Crude Oil Value Specifications 66.5 Sulfur Content 8.808 Pour Point 0.53 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value <0.01 <-30 9.7 <3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 4.0 3.4 48.3 45.2 35.7 38 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cetane Index Viscosity (Kin) Residue Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

74 35 52 13 0.01 <-61 0.05 -21 57.5 0.16 69.1 5.61

Kerosine

165-235 329-455 235-300 455-572

8.8

9.7

Light Gas Oil

2.6

2.9

Int. Gas Oil

300-350 572-662

0.6

0.7

% Wt. 60 C

Residue

>350 >662 Year Of Crude Oil Sample: 1987

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H57

BRUNEI LIGHT
Gravity: 40.3 Sulfur: 0.06

Brunei
Loading Port: Seria

Production Output of about 50,000 barrels a day mainly from offshore fields, of which about 20,00025,000 b/d is blended with Champion to make Seria Light Export Blend. Quality A light, low-sulfur Asian crude oil with a high wax content that is similar to Malaysian Tapis. Producers Brunei Shell Petroleum, a 50/50 joint venture between the government and the Royal Dutch/Shell Group, is the sole producer. Pricing And Marketing All of the roughly 25,000 b/d of exports are sold by Brunei Shell Petroleum on a spot basis, with Singapore, the Philippines, Australia, and China the main importers. Sellers Brunei Shell Petroleum Co. Ltd.: RBA Plaza Jalan Sultan, 2nd Floor, Bandar Seri Begawan 1999, Negara Brunei Darussalam. Tel.: (673-2) 29269, Fax: (673-2) 41417, Telex: BU 2573. Loading Port Seria. 04.43 N. 114.19 E. The Seria terminal is an open-sea berth consisting of two single-buoy moorings located approximately 5.4 miles off the coast. Size restrictions are the following: 313,000 deadweight tons and maximum draft 15.8 meters at SBM 1; 200,000 dwt and maximum draft 17 m at SBM 2.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 20 C Cut Points Temp. C/F <85 <185 85-165 185-329

BRUNEI LIGHT ASSAY Crude Oil Value Specifications 40.3 Sulfur Content 7.643 Pour Point 2.41 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 0.06 9 4.8 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 1.7 1.2 8.6 7.2 23.6 22.1 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

75 30 53 17 0.02 -55 0.04 -24 45.2 0.08 7 54.9 5.74 0.14 45 27.9 0.09 1.16 <1 5

Kerosine

165-235 329-455 235-300 455-572

17.9

17.6

Light Gas Oil

20

20.8

Int. Gas Oil

300-350 572-662

10.8

11.4

% Wt. Temp. C Cen at 40 C % Wt. Temp. C Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

17.6

19.7

Year Of Crude Oil Sample: 1987

CRUDE OIL HANDBOOK

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H59

CHAMPION
Gravity: 23.7 Sulfur: 0.13

Brunei
Loading Port: Seria

Production About 80,000 barrels a day from offshore fields, with 45,000-50,000 b/d blended into the Seria Light Export Blend stream. Quality A typical heavy, low-sulfur Asian crude oil with high wax content, making it similar in quality to Indonesian Duri but somewhat lower in sulfur. Producers Brunei Shell Petroleum, a 50/50 joint venture between the government and the Royal Dutch/Shell Group, is the sole producer. Pricing And Marketing Champion exports are about 30,000-35,000 b/d. All of the production is sold by BSP, mostly on term contracts to third parties in Southeast Asia, Japan, and South Korea. Japanese imports in 1995 were 10,000 b/d. Prices are set on a retroactive basis every month at a narrow discount to higher-quality Seria Light Export Blend, Bruneis main export crude oil. Security of supply and access to Bruneis higher-quality light crude oils and condensate compensate for the relatively stiff price terms. Sellers Brunei Shell Petroleum Co. Ltd.: RBA Plaza Jalan Sultan, 2nd Floor, Bandar Seri Begawan 1999, Negara Brunei Darussalam. Tel.: (673-2) 29269, Fax: (673-2) 41417, Telex: BU 2573. Loading Port Seria. 04.43 N. 114.19 E. The Seria terminal is an open-sea berth consisting of two single-buoy moorings located approximately 5.4 miles off the coast. Size restrictions are the following: 313,000 deadweight tons and maximum draft 15.8 meters at SBM 1; 200,000 dwt and maximum draft 17 m at SBM 2.

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F

CHAMPION ASSAY Crude Oil Value Specifications 23.7 Sulfur Content 6.905 Pour Point 6.97 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 0.13 <-30 2.7 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 0.4 0.3 Light Naphtha <85 1.7 1.3 Light Naphtha <185 Octane RON Int. Naphtha 85-165 6.6 5.6 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 15.8 14.7 Kerosine 329-455 Sulfur Content Freezing Point Light Gas Oil 235-300 26.8 26.3 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 16.4 16.7 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 32.5 35.2 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1987 Nickel CHAMPION TERM CONTRACT PRICES, 1978-93 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 1981 1982 1983 Jan. $13.80 $14.60 $32.95 $39.90 $35.10 $29.10 Feb. 13.80 14.60 32.95 39.90 35.10 29.10 March 13.80 15.70 32.95 39.15 34.10 29.10 April 13.80 17.00 32.95 39.15 34.10 29.10 May 13.80 17.50 34.95 37.75 34.10 29.10 June 13.80 19.90 35.65 36.50 34.10 29.10 July 13.80 22.75 35.65 36.50 34.10 29.10 Aug. 13.80 22.75 35.65 36.50 34.10 29.10 Sept. 13.80 22.75 35.65 36.50 34.10 29.10 Oct. 13.80 22.75 35.65 36.50 34.10 29.10 Nov. 13.80 26.05 35.65 35.10 34.10 29.10 Dec. 13.80 27.45 36.15 35.10 34.10 29.10 Month 1986 1987 1988 1989 1990 1991 Jan. $27.85 $17.60 $17.20 $16.40 $20.20 $27.10 Feb. 20.90 18.30 17.30 18.10 20.60 22.65 March 16.50 17.70 16.65 17.80 20.05 19.20 April ... 18.05 15.85 18.80 18.75 18.35 May ... 18.15 16.75 19.25 16.80 18.85 June ... 18.35 16.75 18.85 15.55 19.50 July ... 18.60 14.70 18.65 15.10 20.00 Aug. 10.85 19.00 14.70 17.85 20.80 20.10 Sept. 12.75 18.70 14.05 17.35 29.50 20.60 Oct. 13.40 18.70 12.50 18.10 38.90 21.70 Nov. 14.00 18.70 12.15 18.95 36.30 22.75 Dec. 14.55 18.05 13.65 19.30 31.20 23.30 Note: More recent prices can be found in Chapter I.

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C % Wt. Temp. C Cen at 40 C % Wt. Temp. C Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 78 20 71 9 0.03 <-65 0.05 <-30 31.5 0.14 <-30 33.7 9.08 0.2 27 241 0.04 1.59 <1 3

1984 $29.10 29.10 29.10 29.10 29.10 29.10 29.10 29.10 29.10 29.10 29.10 29.10 1992 $21.05 19.50 18.65 18.30 19.60 21.20 22.95 22.50 21.70 21.35 21.20 20.40

1985 $29.10 27.85 27.85 27.85 27.85 27.85 27.85 27.85 27.85 27.85 27.85 27.85 1993 $19.30 19.00 20.15 20.80 20.25 19.50 18.75 18.75 18.70 18.10 17.50 15.85

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H61

SERIA LIGHT EXPORT BLEND


Gravity: 34.6 Other Names: SLEB Sulfur: 0.08

Brunei
Loading Port: Seria

Production An export blend of about 70,000 barrels a day made up of 45,000-50,000 b/d of Champion and 20,000-25,000 b/d of Brunei Light. No output from other sources. Quality A medium, low-sulfur Asian crude oil that is similar to Indonesian Minas grade but with a larger kerosine yield. Producers Brunei Shell Petroleum, a 50/50 joint venture between the government and the Royal Dutch/Shell Group, is the sole producer. Pricing And Marketing All exports are sold by Brunei Shell Petroleum, mostly on term contracts to third parties in Singapore, Japan, and Thailand. Japan imported 35,000 b/d in 1995. Prices are set on a retroactive basis every month on the basis of spot prices for similar quality Asian grades. Sellers Brunei Shell Petroleum Co. Ltd.: RBA Plaza Jalan Sultan, 2nd Floor, Bandar Seri Begawan 1999, Negara Brunei Darussalam. Tel.: (673-2) 29269, Fax: (673-2) 41417, Telex: BU 2573. Loading Port Seria. 04.43 N. 114.19 E. The Seria terminal is an open-sea berth consisting of two single-buoy moorings located approximately 5.4 miles off the coast. Size restrictions are the following: 313,000 deadweight tons and maximum draft 15.8 meters at SBM 1; 200,000 dwt and maximum draft 17 m at SBM 2.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

SERIA LIGHT EXPORT BLEND ASSAY Crude Oil Unit Value Specifications API 34.6 Sulfur Content /Metric Ton 7.39 Pour Point Centistokes 3.94 Reid Vapor Press. at 20 C Hydrogen Sulfide Cut Points Temp. C/F

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 0.08 0 4.4 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 1.4 0.9 Light Naphtha <85 6.7 5.4 Light Naphtha <185 Octane RON Int. Naphtha 85-165 18.3 16.6 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 17.6 17.1 Kerosine 329-455 Sulfur Content Freezing Point Light Gas Oil 235-300 21.4 22 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 12.4 12.9 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 22.4 25.1 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1988 Nickel

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C % Wt. Temp. C Cen at 40 C % Wt. Temp. C Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 75 26 54 20 0.04 -60 0.06 -32 39 0.13 6 47.7 6.74 0.2 39 63.2 0.08 1.61 <3 3

SERIA LIGHT EXPORT BLEND TERM CONTRACT PRICES, 1978-93 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 1981 1982 1983 1984 Jan. $14.15 $14.95 $33.40 $40.35 $36.10 $30.10 $30.10 Feb. 14.15 14.95 33.40 40.35 36.10 30.10 30.10 March 14.15 16.10 33.40 39.60 35.10 30.10 30.10 April 14.15 17.45 33.40 39.60 35.10 30.10 30.10 May 14.15 17.95 35.40 38.60 35.10 30.10 30.10 June 14.15 20.35 36.10 37.10 35.10 30.10 30.10 July 14.15 23.20 36.10 37.10 35.10 30.10 30.10 Aug. 14.15 23.20 36.10 37.10 35.10 30.10 30.10 Sept. 14.15 23.20 36.10 37.10 35.10 30.10 30.10 Oct. 14.15 23.20 36.10 37.10 35.10 30.10 29.60 Nov. 14.15 26.50 36.10 36.10 35.10 30.10 28.35 Dec. 14.15 27.90 36.60 36.10 35.10 30.10 28.35 Month 1986 1987 1988 1989 1990 1991 1992 Jan. $28.35 $17.60 $17.20 $16.50 $20.20 $27.25 $21.15 Feb. 21.50 18.30 17.40 18.20 20.60 22.75 19.60 March 17.00 17.90 16.75 17.90 20.10 19.30 18.75 April ... 18.25 15.95 18.90 18.80 18.45 18.40 May ... 18.35 16.85 19.35 16.90 18.95 19.70 June 12.00 18.50 16.85 18.90 15.65 19.60 21.30 July 10.20 18.70 14.80 18.75 15.20 20.10 23.05 Aug. 11.10 19.00 14.80 17.95 20.90 20.20 22.60 Sept. 12.95 18.70 14.15 17.45 29.60 20.70 21.80 Oct. 13.60 18.70 12.60 18.20 39.00 21.80 21.45 Nov. 14.10 18.70 12.25 19.05 36.40 22.85 21.30 Dec. 14.55 18.05 13.75 19.30 31.30 23.40 20.50 Note: More recent prices can be found in Chapter I.

1985 $28.35 28.35 28.35 28.35 28.35 28.35 28.35 28.35 28.35 28.35 28.35 28.35 1993 $19.40 19.10 20.25 20.90 20.35 19.60 18.85 18.85 18.80 18.20 17.60 15.95

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H63

KOLE
Gravity: 34.8 Sulfur: 0.30

Cameroon
Loading Port: Kole

Production Kole is a heavy, sweet grade that is a blend of multiple offshore crude oil streams known as Rio del Rey. Production is declining and was about 75,000 barrels a day in 1995. Kole is the largest production stream in Cameroon. Quality A medium-to-light, low-sulfur West African crude oil that is prized by refiners for its highquality middle distillate yield. Its high metals content poses problems for cracking. Producers Societe Nationale des Hydrocarbures (Cameroon) (70%) , French Elf Aquitaine (15.3%) , US Shell affiliate Pecten (14.7%). Pricing And Marketing Almost all production is exported by the three equity producers with volumes divided according to their shares. Shells Pecten and Elf market their barrels on a spot basis, while Cameroons state SNH sells its share in the form of term contracts with some of the oil resold on a spot basis. In the early 1990s, Elf marketed SNHs share of the grade. All sales are priced on a dated Brent basis. Elf and Shell occasionally take Kole into their own refining systems. Sellers Pecten Trading Co.: P.O. Box 2099, Houston, Texas 77252. Tel.: (713) 241-6161, Fax: (717) 241-0004. Elf Trading S.A.: P.O. Box 532 1215, Geneva 15 Airport, Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110. Main Customers Traditionally cargoes move to the US and Europe with some traders holding term contracts with SNH. Since 1992, cargoes have also increasingly found their way to the Far East, where middle distillate demand has been strong, and where the grade is used as a substitute for similar Asia-Pacific grades. Loading Port Kole. 04.13 N. 08,33 E. The offshore Kole loading point is located about 26 miles from Cape Debunsha and consists of one single-buoy mooring designed for tankers of approximately 50,000-250,000 deadweight tons. The maximum draft is 72 feet (22 meters).

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <85 <185 85-165 185-329

KOLE ASSAY Crude Oil Value Specifications 34.8 Sulfur Content 7.4 Pour Point 4.81 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.3 -18 6.5

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 2.8 1.8 7.0 5.6 17.2 15.4 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

76 29 65 6 0.05 -60 0.15 -24 49.7 0.26 2 55.9 6.34 0.52 36/96.8 236 0.9 6.9 17 41

Kerosine

165-235 329-455 235-300 455-572

12.9

12.3

Light Gas Oil

13.2

13.1

Int. Gas Oil

300-350 572-662

9.4

9.5

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

37.8

42.3

Year Of Crude Oil Sample: 1981 At Port Of Loading In Dollars Per Barrel 1987 1988 1989 Jan. $17.75 $15.95 $16.15 Feb. 16.85 14.85 15.95 March 17.50 13.80 17.75 April 17.70 15.65 19.40 May 18.10 15.30 17.90 June 18.25 14.30 16.70 July 19.10 14.25 16.80 Aug. 18.25 13.95 15.80 Sept. 17.45 12.25 16.90 Oct. 18.00 11.45 18.00 Nov. 16.95 12.05 17.70 Dec. 16.05 14.35 19.00
Note: More recent prices can be found in Chapter I.

KOLE SPOT PRICES, 1987-93 1990 $20.15 19.00 17.40 15.15 15.05 13.50 15.45 25.55 33.75 35.40 31.85 26.65 1991 $21.15 18.50 17.60 17.45 17.65 16.65 17.90 18.40 19.15 20.95 20.40 17.45 1992 $17.20 17.15 16.65 18.15 19.15 20.45 19.55 19.00 19.55 19.65 18.55 17.60 1993 $16.70 17.55 18.10 17.90 17.55 16.70 15.90 15.80 15.20 15.75 14.30 12.75

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H65

LOKELE
Gravity: 19.6 Other Names: Moudi Sulfur: 0.41

Cameroon
Loading Port: Lokele

Production Although declining, this is the second-largest stream in Cameroon with output of about 20,000 barrels a day in 1995. Quality A heavy but low-sulfur crude oil with a high yield of high-pour residual fuel. Producers Societe Nationale des Hydrocarbures (Cameroon) (70%) , French Elf Aquitaine (15.3%) , US Shell affiliate Pecten (14.7%). Pricing And Marketing Like Kole, Lokele is marketed primarily in the Atlantic Basin. It is mostly sold on a termcontract basis, with prices set at a differential to dated Brent. Shells Pecten, Elf, and state SNH each sell their equity volumes separately, but they sometimes combine cargoes for sales to the Far East, which have grown more common. Sellers Pecten Trading Co.: P.O. Box 2099, Houston, Texas 77252. Tel.: (713) 241-6161, Fax: (717) 241-0004. Elf Trading S.A.: P.O. Box 532 1215, Geneva 15 Airport, Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110. Main Customers Mostly sold into Europe, particularly France, with some sales into Far East markets. Loading Port Lokele. 04.07 N. 08.29 E. The Lokele loading terminal, located in the Gulf of Guinea about 50 nautical miles west of Limbe, consists of one floating storage unit (the Moudi, a converted 220,000-ton tanker) and one single-point mooring. The facility accommodates tankers from 50,000-280,000 deadweight tons.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <85 <185 85-165 185-329

LOKELE ASSAY Crude Oil Value Specifications 19.6 Sulfur Content 6.722 Pour Point 45.9 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 0.41 -33 3.1 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 0.8 0.5 1.9 1.4 2.9 2.4 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

74 13 83 4 0.08 <-65 0.16 <-65 33.2 0.33 <-65 35.4 10.89 0.54 27/80.6 1,734 0.22 7.27 7 55

Kerosine

165-235 329-455 235-300 455-572

11.2

10.1

Light Gas Oil

16.5

15.7

Int. Gas Oil

300-350 572-662

13.4

13.1

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

53.6

56.8

Year Of Crude Oil Sample: 1987

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H67

BOW RIVER
Gravity: 25.6 Sulfur: 2.37

Canada
Pipeline: Interprovincial

Production One of many Canadian conventional heavy, sour crude oil production streams from Alberta and other western provinces totaling some 660,000 barrels a day of production in 1995. Other similar crude oils include Hardisty Heavy and the Lloydminster grades, totaling about 250,000 b/d of production. Deliveries of all conventional heavy crude oils by the Interprovincial Pipe Line system amounted to about 550,000 b/d in 1995. Quality Bow River is one of a group of heavy, high-sulfur crude oils that are often good for producing asphalt or for deep conversion refining. This limits the potential refinery outlets, especially in Canada. Producers Produced by a wide range of small independents and other larger oil companies. Pricing And Marketing Interprovincial Pipe Lines shipments of heavy grades like Bow River go mainly to US Midwest refiners, with only about 100,000 b/d used by Eastern Canadian refiners. An active spot trade exists at the Chicago terminal of the IPL with prices linked to West Texas Intermediate. Canadian prices are based on refiner postings and are responsive to price trends in the US. Buyers And Sellers The main buyers include US deep conversion refiners such as Koch, Amoco, and Mobil. Key sellers include Canadian marketers such as Northridge Petroleum. Pipelines The main gathering point for Bow River and other Western Canadian heavy crude oils is along the Interprovincial Pipe Line starting in in Edmonton, Alberta. The 1.6-million b/d pipeline system, which carries over 60 grades of crude oil and condensate, extends eastward to Duluth, Minnesota, where it splits into a northern branch across Michigan and into Ontario and a southern branch to Chicago. The section that runs east from Sarnia, Ontario, has carried about 160,000 b/d of Canadian domestic crude oil to eastern refiners, but this is due to be reversed in 1998 to allow increased imports of Atlantic Basin grades. This should release an equivalent volume of Canadian crude oil to the US Midwest market.

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F 55-175 175-300 Yield % Vol. 1.1 5 6.9

BOW RIVER ASSAY Crude Oil Value Specifications 24.7 Sulfur Content 6.96 Pour Point 21.9

Unit % Weight Temp. F

Value 2.1 -10

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F. % Wt. 50 C % Wt. Temp. F Cst at 50 C

69 54 36 10 41 44 15 0.48 -77 0.94 44 7.61 3 60 121

Heavy Naphtha

300-400

6.5

Kerosine

400-500

8.8

Gas Oil

500-650

14.3

Residue

>650

57.4

Year Of Crude Oil Sample: 1989

INTERPROVINCIAL PIPE LINE SPECIFICATIONS FOR SELECTED HEAVY CRUDE OILS 1995 API Gravity Bow River 25.6 Cold Lake 22.1 Lloydminster Hardisty 22.2 % Sulfur 2.37 3.5 3.09 Pour Point Temp.C <-27 <-27 <-27 Viscosity (cts) 40C 17.36 41.29 34.16

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H69

HIBERNIA
Gravity: 32 Sulfur: 0.5

Canada
Loading Port: Hibernia Platform

Production The field, which lies offshore eastern Newfoundland in the North Atlantic is due to begin production in late 1997 with output rising to a plateau level of 125,000 barrels a day in 2000. Other adjacent fields are likely to be added, keeping overall flows at these levels or higher. Quality A waxy, sweet crude oil with a relatively high pour point of as much as 60 degrees Fahrenheit. It is likely to be good for upgrading but may present some handling problems. A full assay is not available until commercial production begins. Producers Produced by Mobil (33%), Chevron (27%), Petro-Canada (25%), Murphy (6.5%), and Canada Hibernia Holdings (6.5%). Pricing And Marketing Pricing terms have yet to be determined, but the crude oil seems likely to trade at a differential to West Texas Intermediate. The crude oil should be easily marketed to nearby eastern Canadian and US refiners. Loading Port The crude oil will be loaded at the Hibernia platform which lies 315 kilometers eastsoutheast of St. Johns, Newfoundland. The platform will have storage capacity of 1-million barrels and will be served by dedicated tankers of 120,000 deadweight tons that will deliver the crude oil to a transshipment terminal at Whitten Head near Newfoundlands Come By Chance refinery. From the terminal it will be shipped to East Coast refiners in Canada and the US.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F 55-175 175-300 Yield % Vol. 1.7 5.4 10.6

HIBERNIA ASSAY Crude Oil Value Specifications 32.1 Sulfur Content 7.29 Pour Point 2.5 Total Acid

Unit % Weight Temp. F mg KOH/g

Value 0.59 45 0.15

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties LPG Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F. % Wt. 50 C % Wt. Temp. C/F Cst at 50 C

68 48 41 11 45 42 13 0.04 -33 0.21 51 3.49 0.88 40/104 311

Heavy Naphtha

300-400

9.2

Kerosine

400-500

8.3

Gas Oil

500-650

15.9

Residue

>650

48.9

Year Of Crude Oil Sample: 1986

CRUDE OIL HANDBOOK

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H71

MIXED BLEND SWEET


Gravity: 39-40 Sulfur: 0.25-0.5

Canada
Pipeline: Interprovincial

Other Names: Canadian Par, Alberta Light Main Crude Oils: Federated, Pease, Pembina, and Rainbow Production Output comes from a host of fields mainly in Alberta and elsewhere in Western Canada. The light, sweet crude oil volumes delivered on the Interprovincial Pipe Line in 1995, which were equivalent to Canadian Par, amounted to just under 250,000 barrels a day, with just over 100,000 b/d destined for export to the US. This appears to be about half of the total production. Canadian Par and Mixed Blend Sweet are broad pipeline streams that contain many of the same crude oils. Quality A light, sweet crude oil that is equivalent to West Texas Intermediate. It has excellent gasoline manufacturing capabilities. The assay is for Mixed Blend Sweet. Producers Produced by a wide range of companies. Pricing And Marketing Interprovincial Pipe Line shipments of this grade are split about equally between refiners in Eastern Canada and the US Midwest. An active spot trade exists in the US Great Lakes region with prices linked to West Texas Intermediate. Canadian prices are based on refiner postings and are responsive to price trends in the US. Buyers And Sellers The main buyers include Canadian refiners such as Imperial, Shell and Petro-Canada as well as Chicago and Detroit area refiners in the US. Key sellers include Canadian marketers such as Northridge Petroleum. Pipelines The main gathering point for Canadian Par is at the Interprovincial Pipe Line in Edmonton, Alberta. The 1.6-million b/d pipeline system extends eastward to Duluth, Minnesota, where it splits into a northern branch across Michigan and into Ontario and a southern branch to Chicago. The section that runs east from Sarnia, Ontario, has carried about 160,000 b/d of Canadian crude oil to eastern refiners, but this is due to be reversed in 1998 to allow increased imports of Atlantic Basin grades. This should release an equivalent volume of Canadian crude oil to the US Midwest market.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F 55-175 175-300

MIXED BLEND SWEET ASSAY Crude Oil Value Specifications 39 Sulfur Content 7.596 Pour Point 3.4

Unit % Weight Temp. F

Value 0.39 15

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. 2.6 7.9 15.3 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F. % Wt. 50 C % Wt. Temp. F Cst at 50 C

69 44 45 11 45 40 15 0.18 -39 0.35 52 3.36 0.81 90 92.7

Heavy Naphtha

300-400

11.5

Kerosine

400-500

11.4

Gas Oil

500-650

15.3

Residue

>650

36

Year Of Crude Oil Sample: 1989

INTERPROVINCIAL PIPE LINE SPECIFICATIONS FOR SELECTED LIGHT CRUDE OILS 1995 API Gravity 39.2 40.3 39.0 40.3 39.8 % Sulfur 0.27 0.47 0.28 0.39 0.35 Pour Point Temp.C <-27 -21 -12 -18 -7 Viscosity (cts) 40C 2.70 2.81 3.56 2.85 2.89

Federated Peace Pembina Rainbow Mixed Blend Sweet

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H73

DAQING
Gravity: 32.1 Other Names: Taching Sulfur: 0.11

China
Loading Port: Dairen (Dalian)

Production Exports of just over 200,000 barrels a day are about one-fifth of the 1.1-million b/d output of Chinas largest field, where flows are maintained by extensive water flooding. The field lies in the Songliao Basin of northeastern China, the countrys main oil producing region. Output is expected to decline to 1-million b/d or less in the late 1990s due to aging of the field, which, along with rapidly rising domestic oil demand, should curb exports. Exports were about 300,000 b/d in 1993. Quality Medium-gravity, low-sulfur Asian crude oil that is high in wax content. It is very similar to Indonesian Minas. Producers Produced exclusively by state China National Petroleum Co. Pricing And Marketing Sold primarily to Japan, which absorbed 200,000 b/d in 1995, with smaller volumes going to Singapore and other destinations. A large share of the Japanese volume is used as boiler fuel by electric utilities. Japanese sales are at retroactive monthly prices that track Indonesian Minas levels. The primary seller is state Sinochem, but it no longer holds an exclusive monopoly on exports. Spot sales are rare. Sellers Sinochem International Oil (Hong Kong) Co.: 47/F Office Tower, Convention Plaza, 1 Harbour Road, Wanchai, Hong Kong. Tel.: (852) 824-0100, Fax: (852) 824-2002. Sinochem International Oil (Singapore) Pte. Ltd.: 4 Shenton Way, #09-08/12 Shing Kwan House, 0106, Singapore. Tel.: (65) 225-5188, Fax: (65) 225-3878. Loading Port Dairen (Dalian). 38.55 N. 121.40 E. The Dairen terminal, located on the Bohai coast on the southern edge of Chinas northern Liaodong Peninsula, has two tanker berths on the crude oil-loading jetty. Size restrictions are 100,000 deadweight tons and a maximum draft of 15 meters for Berth No. 1, and a maximum draft of 12 m for Berth No. 2. The port is being expanded to take 150,000-dwt tankers and has loaded ships up to 125,000 dwt.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F

DAQING ASSAY Crude Oil Value Specifications 32.2 Sulfur Content 7.3 Pour Point 33.4

Unit % Weight Temp. F

Value 0.11 90

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. Properties LPG 0.5 Light Naphtha 55-175 2.4 Light Naphtha Octane RON Int. Naphtha 175-300 5.5 Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha 300-400 5.2 Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine 400-500 6.3 Kerosine Sulfur Content Freezing Point Gas Oil 500-650 12 Gas Oil Sulfur Content Cetane Index Viscosity (Kin) Residue >650 68.1 Residue Sulfur Content Pour Point Year Of Crude Oil Sample: 1987 Viscosity (Kin) DAQING TERM-CONTRACT PRICES, 1986-91 At Port Of Loading In Dollars Per Barrel Month 1986 1987 1988 1989 1990 1991 Jan. $17.58 $17.15 $16.83 $17.06 $19.21 $24.23 Feb. 17.58 17.15 16.83 17.06 19.21 20.55 March 17.58 17.15 16.83 17.06 19.21 16.47 April 10.62 17.40 16.29 18.15 16.09 17.21 May 10.62 17.40 16.29 18.15 16.09 17.88 June 10.62 17.40 16.29 18.15 16.09 18.22 July 10.65 17.78 14.48 17.12 15.20 18.57 Aug. 10.65 17.78 14.48 17.12 15.20 18.80 Sept. 10.65 17.78 14.48 17.12 29.75 19.04 Oct. 13.12 17.50 12.68 17.40 35.42 19.83 Nov. 13.12 17.50 12.68 17.40 33.60 20.45 Dec. 13.12 17.50 12.68 17.40 27.71 19.59 Month Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. 1987 $16.65 17.00 16.90 17.15 17.25 17.35 17.65 18.25 17.80 18.05 17.85 16.65 1988 $17.05 17.00 15.55 15.95 16.30 16.15 15.00 14.40 13.50 11.75 12.10 13.85 DAQING SPOT PRICES, 1987-92 1989 1990 1991 1992 $16.80 $19.80 $23.40 $17.80 17.35 20.80 19.85 17.55 17.05 18.65 17.20 17.10 18.20 16.75 17.10 17.20 18.15 15.75 17.75 17.80 18.05 14.90 18.20 19.95 17.95 16.00 18.65 21.00 16.90 23.45 18.70 19.85 16.50 30.00 18.80 19.25 16.70 35.25 19.40 19.70 17.35 33.10 20.25 20.05 17.85 27.30 19.00 19.40

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F. % Wt. 50 C % Wt. Temp. F Cst at 50 C

Value 62 54 42 4 66 38 6 0.02 -15 0.04 60 3.34 0.15 106 159

Note: More recent prices can be found in Chapter I.

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H75

SHENGLI
Gravity: 22.5 Sulfur: 0.90

China
Loading Port: Qingdao (Tsing Tao)

Production Total output dropped to 600,000 barrels a day or 3% in 1995 from Chinas second-largest field, which lies onshore just south of Bohai Bay. Exports have declined and amount to about 50,000 b/d. The field is mature, and extensive enhanced recovery efforts are under way to slow its natural decline. Quality A heavy Asia-Pacific crude oil similar to Indonesian Duri that is not particularly attractive to refiners and is used for direct burning by Japanese utilities. The assay below is somewhat dated, and recent tests indicate that the gravity has slipped to 22.5 with a sulfur content of 0.9% and a pour point of 28 degrees centigrade. Producers Produced exclusively by state China National Petroleum Co. Pricing And Marketing Sold primarily to Japan, which absorbed 27,000 b/d in 1995, with smaller volumes moving to Singapore and elsewhere. Most of the Japanese volume is used as boiler fuel by electric utilities. Japanese sales are at retroactive monthly prices that track Indonesian Duri levels plus a premium. The primary seller is state Sinochem, but it no longer holds an exclusive monopoly on exports. Sellers Sinochem International Oil (Hong Kong) Co.: 47/F Office Tower, Convention Plaza, 1 Harbour Road, Wanchai, Hong Kong. Tel.: (852) 824-0100, Fax: (852) 824-2002. Sinochem International Oil (Singapore) Pte. Ltd.: 4 Shenton Way, #09-08/12 Shing Kwan House, 0106, Singapore. Tel.: (65) 225-5188, Fax: (65) 225-3878. Loading Port Qingdao (Tsing Tao). 36.05 N. 120.18 E. The terminal, located on the Yellow Sea coast about 380 miles north of Shanghai, has two crude oil-loading berths capable of handling vessels up to 50,000 deadweight tons. Maximum draft is 12 meters on the West berth and 13 m on the East berth. It is connected by pipeline to the Shengli field.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <5/<41 5-85 41-185 85-165 185-329

SHENGLI ASSAY Crude Oil Value Specifications 24.2 Sulfur Content 6.927 Pour Point 124 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 0.84 27 1.6 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 0.4 0.3 1.8 1.3 4.6 3.8 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

67 43 46 11 0.07 -51 0.27 -19 50.9 0.45 9 59.7 718 1.06 42/107.6 718 1 8 2 36

Kerosine

165-235 329-455 235-300 455-572

5.6

Light Gas Oil

8.5

7.9

Int. Gas Oil

300-350 572-662

7.7

7.3

% Wt. Temp. C Cen at 60 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

71.4

74.4

Year Of Crude Oil Sample: 1980

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H77

CANO LIMON
Gravity: 29.5 Sulfur: 0.47 Other Names: Colombian Blend

Colombia
Loading Port: Covenas

Production Production has been declining in recent years from peak levels of almost 500,000 barrels a day and flows in 1995 were about 215,000 b/d with exports of about 125,000 b/d. The crude oil from the Cano Limon field, which lies in the Amazon Basin, travels through a 490-mile pipeline across the Andes to the Caribbean export terminal at Covenas. Quality A medium- to heavy-gravity crude oil that is relatively low in sulfur, similar in quality to US Alaskan North Slope. Although from early production, the assay below is still accurate. Producers US Occidental is the operator, but it has sold off significant stakes and now holds only a 6.5% share with partners state Ecopetrol (50%), Shell (25%), and Repsol (18.5%). Pricing And Marketing Cano Limon has been Colombias main export crude oil in the late 1980s and first half of the 1990s, but it is being overtaken by fast rising Cusiana. State Ecopetrol sells about half of the volume through a combination of term contracts and spot sales to independent refiners and traders, mainly in the US. Ecopetrol holds regular tenders for these term contracts as they expire. With the exception of Occidental, the equity producers tend to keep the crude oil within their own systems. Ecopetrols prices are on an f.o.b. basis and linked by formulas to spot prices of US West Texas Intermediate grade. Sales are frequently interrupted due to periodic attacks on the vulnerable export pipeline by antigovernment guerrillas. Sellers Ecopetrol: Carrera 12, No. 36-24, Apdo. Aereo 5938, Santa Fe de Bogota, D.C. Colombia. Tel.: (57-1) 285-6400. Shell International Trading And Shipping Company (STASCO): Shell-Mex House, Strand, London WC2R 07A. Tel.: (44-171) 546-1234. Fax: (44-171) 546-4448. Loading Port Covenas. 09.25 N. 75.42 W. The Covenas offshore terminal is located in the Gulf of Morresquillo about 56 miles south-southwest of Cartagena in the Caribbean Sea. Loading facilities consist of a single-buoy mooring and a floating storage unit, which is a permanently moored 390,000-deadweight ton tanker. Size restrictions are maximums of 145,000 dwt and vessel length of 265 meters for berthing at the FSU, and 145,000 dwt and vessel length of 300 m for berthing at the SBM.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <85 <185 85-165 185-329

CANO LIMON ASSAY Crude Oil Value Specifications 29.5 Sulfur Content 7.166 Pour Point 13.06 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.47 0 2.3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 0.2 0.1 2.7 2.1 10.4 8.8 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

62 62 36 2 0.03 -55 0.12 -25 52.9 0.3 3 57.1 6.19 0.82 33/91.4 239 5.45 10.35 17 72

Kerosine

165-235 329-455 235-300 455-572

13.3

12.1

Light Gas Oil

14

13.4

Int. Gas Oil

300-350 572-662

10.7

10.5

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

48.8

53

Year Of Crude Oil Sample: 1986

CANO LIMON SPOT AND TERM-CONTRACT PRICES, 1986-93 At Port Of Loading In Dollars Per Barrel. Spot Prices For 1986-87, And Term-Contract Prices Thereafter. Month 1986 1987 1988 1989 1990 1991 1992 1993 Jan. ... $18.55 $15.33 $16.00 $20.25 $20.30 $15.79 $16.43 Feb. ... 17.55 14.73 16.17 19.77 15.04 16.10 17.58 March ... 18.05 14.18 17.65 18.36 16.57 16.36 17.87 April ... 18.40 16.18 19.93 14.66 18.21 17.71 17.79 May 13.80 19.10 15.23 18.10 14.39 17.77 18.51 17.55 June 11.65 19.45 14.58 17.52 13.35 17.32 20.18 16.64 July 9.90 20.35 14.16 17.45 15.67 18.15 19.44 14.99 Aug. 13.70 19.05 13.96 16.60 26.37 18.51 18.81 15.28 Sept. 13.80 18.45 12.71 16.85 33.66 18.95 19.34 14.88 Oct. 14.05 18.90 11.55 17.65 32.17 20.18 19.39 15.73 Nov. 14.35 17.50 11.45 17.85 29.58 19.17 18.16 14.07 Dec. 15.65 15.80 14.10 19.30 24.91 16.43 17.19 12.11
Note: More recent prices can be found in Chapter I.

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H79

CUSIANA
Gravity: 36.3 Sulfur: 0.25 Other Names: Cusiana Light, Cusiana/Cupiagua

Colombia
Loading Port: Covenas

Production Production reached 200,000 barrels a day at end-1995 and is scheduled to hit 500,000 b/d by end-1997. The field lies in the foothills of the eastern Andes and with neighboring Cupiagua contains at least 2-billion barrels of reserves. Exports were running at about 100,000 b/d in 1996 and should reach about 400,000 b/d in 1998. The fields are connected to the Caribbean port of Covenas by a 500-mile pipeline system that is being expanded to handle the increased output. Quality Cusiana itself is a light, low-sulfur crude oil that is comparable to North Sea Brent or Nigerian Bonny Light. It has wide cuts of reforming naphtha and middle distillates and is excellent for use with high-conversion units. Quality is likely to improve in 1998 with the addition of some 200,000 b/d of lighter 42-gravity Cupiagua grade into the export stream. Producers In addition to operator BP (15.2%), other partners are state Ecopetrol (60%), Total (15.2%) and Triton Energy (9.6%). Pricing And Marketing Cusiana is sold on the international market by all of the equity partners, with Ecopetrol relying primarily on term contracts with US Gulf Coast refiners while others tend to sell on a spot basis. In 1996, Ecopetrols main term customers were Tosco and Fina. Other buyers include Sun, Mapco, and Amoco. Ecopetrols prices are on an f.o.b. basis and linked by formulas to spot prices of US West Texas Intermediate grade. Spot sales by other producers are on a similar basis. Sellers Ecopetrol: Carrera 12, No. 36-24, Apdo. Aereo 5938, Santa Fe de Bogota, D.C. Colombia. Tel.: (57-1) 285-6400. Contacts Enrique Lee or Fernando Cardenas. Tel. (571) 287-0240 or (57-1) 285-2456. British Petroleum: Contacts Marty Power or Keith Chipchase. Tel: (713) 560-5515 or (216) 586-6091. Total: Contact Alberto Valcarcel (713) 739-3446. Triton Energy: Contact Rick Stevens (214) 691-5200. Loading Port Covenas. 09.31 N. 75.47 W. The Covenas offshore terminal is located in the Gulf of Morresquillo about 56 miles south-southwest of Cartagena in the Caribbean Sea. Loading facilities consist of a single-buoy mooring and a floating storage unit, which is a permanently moored 390,000-deadweight ton tanker. Size restrictions are maximums of 145,000 dwt and vessel length of 265 meters for berthing at the FSU, and 145,000 dwt and vessel length of 300 m for berthing at the SBM.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F <300

CUSIANA ASSAY Crude Oil Value Specifications 36.3 Sulfur Content 7.47 Pour Point 4.73

Unit % Weight Temp. F

Value 0.25 32

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Naphtha Yield % Vol. % Wt. 2.2 1.85 20.8 17.9 Properties Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Vanadium Nickel Unit Value

Kerosine

300-450

15.9

15.15

% Wt. % Wt. % Wt. % Wt. Temp. F % Wt. Temp. F Cts at 122 F % Wt. Temp. F Cen at 122 F % Wt. Parts/mill. Parts/mill.

57 29 14 0.002 -83 0.12 53 45 3.01 0.54 102 62.4 0.2 <2 <2

Gas Oil

450-648

24.3

24.9

Residue

>648

36.8

40.2

Year Of Crude Oil Sample: 1995

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H81

VASCONIA
Gravity: 25.3 Sulfur: 0.81

Colombia
Loading Port: Covenas

Production Production is about 145,000 barrels a day with about 100,000 b/d used in Colombia and the remainder exported. The crude oil comes from a group of fields in central Colombia. The fields are connected to the Caribbean port of Covenas by pipeline. Quality Vasconia is a medium- to low-sulfur, medium-weight crude oil. It is good for gasoline manufacturing, and the middle distillates have good cold properties. Producers Royal/Dutch Shell is the field operator and main producer along with Ecopetrol. Pricing And Marketing Vasconia is marketed internationally by Shell, which sells it primarily on a spot basis to US refiners at prices linked to West Texas Intermediate grade. Ecopetrol uses its share of production locally. Sellers Shell International Trading And Shipping Company (STASCO): Shell-Mex House, Strand, London WC2R 07A. Tel.: (44-171) 546-1234. Fax: (44-171) 546-4448. Also: Houston: (713) 241-6343. Loading Port Covenas. 09.31 N. 75.47 W. The Covenas offshore terminal is located in the Gulf of Morresquillo about 56 miles south-southwest of Cartagena in the Caribbean Sea. Loading facilities consist of a single-buoy mooring and a floating storage unit, which is a permanently moored 390,000-deadweight ton tanker. Size restrictions are maximums of 145,000 dwt and vessel length of 265 meters for berthing at the FSU, and 145,000 dwt and vessel length of 300 m for berthing at the SBM.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <85 <185 85-165 185-329 Yield % Vol. 1.1 4.1 10.4

VASCONIA ASSAY Crude Oil Value Specifications 25.3 Sulfur Content 6.986 Pour Point 21 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.81 -9 3.4

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

74 36 50 14 0.06 -64 0.28 -30 43 0.45 -2 48 7.3 1.28 41 1089 5.93 11.4 148 79

Kerosine

165-235 329-455 235-300 455-572

9.8

Light Gas Oil

11.5

Int. Gas Oil

300-350 572-662

10.7

% Wt. Temp. C Cen at 40 C % Wt. Temp. C Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

53.1

Year Of Crude Oil Sample: 1994 1993 $16.43 17.58 17.87 17.79 17.55 16.64 14.99 15.28 14.88 15.73 14.07 12.11

VASCONIA SPOT PRICES, 1993 Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec.

Note: More recent prices can be found in Chapter I.

CRUDE OIL HANDBOOK

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H83

DJENO
Gravity: 27.6 Sulfur: 0.23 Other Names: Emeraude

Congo
Loading Port: Djeno

Production Output of about 150,000 barrels a day comes from several mature offshore fields including Emeraude, Loango, Yanga, Sendji, and Tchibouela, which are operated by French Elf and Italian Agip. State Hydro Congo has no direct equity stake in these fields. Quality A heavy, low-sulfur West African crude oil, with high wax content and a high pour point. Pricing And Marketing Traditionally, the crude oil was used primarily in the internal refining systems of Elf and Agip, but open market sales have increased to both Europe and Asia in the mid-1990s in addition to occasional sales to the US and Caribbean. Taiwans CPC has a 30,000 b/d term contract and Hungarys Mol is also a buyer. Prices are set according to discounts to UK Brent Blend, which typically are about $2.50 a barrel. Sellers Elf Trading SA, Geneva: P.O. Box 532 1215, Geneva 15 Airport, Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110. Agip Spa: 89-91 Via del Serafico, Rome 00142, Italy. Tel.: (39-6) 503-92-241, Fax: (396) 503-92-320. Loading Port Djeno. 04.56 S. 11.54 E. The loading point at the Djeno terminal is about 2.2 miles (3.8 kilometers) from the coast, and about 9.5 miles south-southeast of the main Pointe Noire lighthouse. The single-buoy mooring facility is designed for tankers of approximately 40,000-140,000 deadweight tons or partly loaded tankers of up to 240,000 dwt. The maximum draft is 16 meters.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. F <175 175-300 Yield % Vol. 1.3 3.4 7.4

DJENO ASSAY Crude Oil Value Specifications 27.6 Sulfur Content 7.086 Pour Point 47.3

Unit % Weight Temp. F

Value 0.23 60

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Naphthenes Aromatics Heavy Naphtha Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Atmospheric Gas Oil Sulfur Content Cloud Point Cetane Index Residue Sulfur Content Pour Point Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F % Wt. Temp. F

66 41 7 54 9 0.12 -30 0.14 20 50 0.29 73.4

Heavy Naphtha

300-400

8.8

Kerosine

400-500

7.4

Atmos. Gas Oil

500-650

12.9

Residue

>650

60.8

Year Of Crude Oil Sample: 1987

% Wt. Temp. F

CRUDE OIL HANDBOOK

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H85

NKOSSA
Gravity: 39.5 Sulfur: 0.08

Congo
Loading Port: NKossa

Production Output of about 90,000 barrels a day comes from West Africas first deep-water field. The field lies in 180-350 meters of water just north of the Angola-Cabinda border. Output is expected to peak at 120,000 b/d in 1998. Quality A light, low-sulfur West African crude oil that is well suited to gasoline manufacturing. Higher quality than typical West African grades, similar to Angola Palanca. Producers The NKossa field is operated by Elf. Other shareholders include Chevron and South Africas Engen. Pricing And Marketing Initial sales have been primarily to Europe and the US at prices linked to dated Brent crude oil. While these are likely to remain primary markets for the crude oil, Asian sales are also likely from time to time. Sellers Elf Trading SA, Geneva: P.O. Box 532 1215, Geneva 15 Airport, Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110. Loading Port NKossa. 05.20 S. 11.35 E. The crude oil is loaded from a dedicated storage tanker at the field. The terminal is located about 25 miles offshore.

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Crude Oil Specifications Gravity (60 F) Barrels

Unit API /Metric Ton

NKOSSA ASSAY Crude Oil Value Specifications 39.5 Sulfur Content 7.62

Unit % Weight

Value 0.08

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha <80 Int. Naphtha 80-150 Kerosine 150-230 Gas Oil 230-400 Residue >400 Year Of Crude Oil Sample: 1996 Cut Points Temp. C Yield % Wt. 1.3 4.5 10.5 13.5 32.9 37.3

CRUDE OIL HANDBOOK

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H87

DUBAI
Gravity: 31.0 Other Names: Fateh Sulfur: 2.04

Dubai
Loading Port: Fateh

Production Output is in decline, dropping to an expected 250,000 barrels a day in 1997. Production from the offshore Fateh, Faleh, Southwest Fateh, and Rashid fields peaked in 1990 at about 415,000 b/d. Additional drilling and a limited gas injection program have helped slow the decline, but a major gas injection program requires much larger imports, which have been difficult to obtain from neighboring countries and emirates at an attractive enough price. The investment costs may also require a major adjustment to the fiscal regime. Quality A typical light, sour Mideast crude oil. Usually designated as a 32-gravity crude oil, but flows are a bit heavier. Although slightly heavier than Saudi benchmark Arabian Light, it is considered a reasonably good substitute by most refiners. Producers Dubai Producing Co.: Conoco (30%), Repsol (25%), Total (25%), Texaco (10%), Sun (5%), and Wintershall (5%). Conoco is operator. The companies receive a fixed margin on their production. Pricing And Marketing Little of the crude oil is committed on a term basis, and even those volumes are usually resold into the Arabian Gulfs most active spot crude oil market. The vast majority of cargoes are sold into the spot market through forward trading. While the equity producers and numerous international oil companies are active in forward trading, physical cargoes rarely move to the Atlantic Basin. However, spread trading between North Sea Brent and Dubai dominates the forward market. Eastern shipments focus on Japan and shorter-haul customers in Singapore and the Indian subcontinent. Japan imported 46,000 b/d in 1995, down by over 40% from 1994. (See detailed discussion of the Dubai market on pB20). Sellers In addition to the largest equity producers, many large crude oil traders and Wall Street firms are active in both forward and physical Dubai trading. These include Statoil, BP, Shell, and Morgan Stanley. Conoco Ltd.: Park House, 116 Park St., London W1Y 4NN, UK. Tel.: (44-171) 4086000, Fax: (44-171) 408-6969. Total Petroleum Services Ltd.: 101-103 Baker St., London W1M 1FD, UK. Tel.: (44171) 935-3222, Fax: (44-171) 935-3102. Repsol SA: Paseo de la Castellana 89, 28046 Madrid, Spain. Tel.: (91) 348-8100, Fax: (91) 555-7671. Loading Port Fateh. 25.35 N. 54.25 E. Located approximately 60 miles north-northwest off the coast of Dubai, the Fateh terminal has 2 single-point moorings. Maximum displacement is 350,000 tons, with no draft restriction.

H88

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 10 C Cut Points Temp. C/F

DUBAI ASSAY Crude Oil Value Specifications 31 Sulfur Content 7.23 Pour Point 17.4 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 2.04 -21 5 9

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 2.3 1.5 Light Naphtha <85 6.6 5.1 Light Naphtha <185 Octane RON Int. Naphtha 85-165 12.8 11.1 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 13.2 12.1 Kerosine 329-455 Sulfur Content Freezing Point Light Gas Oil 235-300 11.8 11.5 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 9.8 9.9 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 43.9 48.8 Residue >662 Sulfur Content Pour Point Year Of Crude Oil Sample: 1981 Viscosity (Kin) AVERAGE MONTHLY DUBAI SPOT PRICES, 1987-93 At Port Of Loading In Dollars Per Barrel Month 1987 1988 1989 1990 1991 1992 Jan. $17.20 $15.40 $14.45 $17.45 $19.40 $15.20 Feb. 16.70 15.05 14.60 16.80 14.45 15.75 March 16.90 13.40 15.95 15.80 14.85 15.80 April 16.95 14.95 16.90 14.30 15.35 16.70 May 17.05 14.85 15.65 14.60 15.90 17.60 June 17.25 13.80 15.40 13.25 15.40 19.00 July 17.75 13.05 15.50 15.30 16.25 18.50 Aug. 17.30 13.15 15.00 25.00 16.65 17.80 Sept. 17.00 11.55 15.60 30.30 17.80 18.30 Oct. 17.05 10.30 16.15 31.55 18.95 18.25 Nov. 16.60 10.60 16.15 27.95 18.45 17.15 Dec. 15.50 12.50 17.10 23.25 15.30 16.25

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C % Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C

Value 63 55 31 14 0.36 -54 1.51 -24 47.8 2.13 2 49.9 6.24 3.24 27/80.6 212

1993 $15.20 16.00 16.30 16.35 16.00 15.60 14.25 14.75 14.20 14.80 13.70 12.05

AVERAGE MONTHLY DUBAI-BRENT PRICE SPREAD, 1987-93 Brent Minus Dubai In Dollars Per Barrel Month 1987 1988 1989 1990 1991 1992 1993 Jan. $1.20 $1.45 $2.55 $3.05 $3.85 $2.90 $2.30 Feb. 0.60 0.70 2.05 2.95 4.15 2.35 2.45 March 1.00 1.35 2.75 2.85 4.00 1.85 2.55 April 1.15 1.65 2.85 2.65 3.90 2.30 2.45 May 1.70 1.55 2.70 2.50 3.25 2.40 2.65 June 1.60 1.75 2.10 2.35 2.90 2.20 2.10 July 2.05 1.85 2.25 2.40 3.20 1.85 2.55 Aug. 1.65 1.80 2.10 1.95 3.15 2.00 2.05 Sept. 1.35 1.75 2.20 3.30 2.70 1.95 1.95 Oct. 1.75 2.15 2.85 4.00 3.20 2.10 1.90 Nov. 1.20 2.40 3.00 3.95 2.85 2.10 1.65 Dec. 1.60 2.65 2.60 4.05 3.05 2.05 1.55
Note: More recent prices can be found in Chapter I.

CRUDE OIL HANDBOOK

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H89

MARGHAM CONDENSATE
Gravity: 50.2 Sulfur: 0.04

Dubai
Loading Port: Jebel Ali

Production About 25,000 barrels a day of condensate produced in association with natural gas from an onshore field, with rising gas output used mainly to maintain pressure in the Dubai crude oil fields. Quality A full-range condensate that produces both gasoline and middle distillates, as well as a small volume of residue. Producers Operator Arco holds 100%. Pricing And Marketing Rarely appears in the market, but this may be due to its small volume. Loading Port Jebel Ali. 25.00 N. 55.03 E. Located in the west of the emirate. A single-tanker berth is capable of loading vessels up to 400,000 deadweight tons.

H90

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 20 C Cut Points Temp. C/F <85 <185 85-165 185-329

MARGHAM CONDENSATE ASSAY Crude Oil Value Specifications 50.2 Sulfur Content 8.086 Pour Point 1.49 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 0.04 -8 9.8 <5

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 5.6 4.1 17.8 15.5 24.8 24.7 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

70 39 24 37 0.02 -51 0.04 -23 50.9 0.27 3 57.1 4.4 0.17 32/89.6 9.6 <0.05 0.04 <1 <1

Kerosine

165-235 329-455 235-300 455-572

17.2

17.8

Light Gas Oil

13.4

14.5

Int. Gas Oil

300-350 572-662

7.2

% Wt. Temp. C Cen at 50 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

13.9

15.4

Year Of Crude Oil Sample: 1985

CRUDE OIL HANDBOOK

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H91

ORIENTE
Gravity: 28.8 Sulfur: 1.02

Ecuador
Loading Port: Esmeraldas

Production About 350,000 barrels a day of Oriente crude oil is produced mainly by state Petroecuador from the Shushufindi field and a series of smaller fields on the east side of the Andes Mountains which all feed into the same pipeline to the Pacific. Petroecuador itself produces about 305,000 b/d. Up to 125,000 b/d is refined domestically, leaving about 200,000-225,000 b/d for export. Some 40,000 b/d is also exported via Colombia because of the capacity limitations of the Trans-Andean pipeline. Quality A medium-gravity, medium-sour crude oil that is similar to US Alaskan North Slope, but with higher metals content. Producers Petroecuador and a long-standing joint venture with US City Investing Co. and Oryx. Other producers include YPFs Maxus unit, Occidental, Tripetrol, and Elf. Pricing And Marketing Petroecuador sells its crude oil exclusively on a term-contract basis, but its buyers are actively engaged in re-trading these barrels, usually in the spot market. About half the barrels are equally divided between the US Gulf Coast and South Korea, but cargoes also go to the Caribbean, Latin America, and the US West Coast. Oriente is usually priced at a differential to WTI on the US Gulf Coast, but West Coast ANS prices are also used when appropriate. Term buyers sign one-year contracts, which are bid upon by offering premiums to Petroecuadors established formula. Term customers include Korean refiners, Tosco, and Texaco. Traders such as Tripetrol and Glencore often control a large share of the exports through front companies. As a result, the 12 or so term customers actually represent a smaller group. Sellers Petroecuador: Apartado 5007, Alpallana y Ave. 6 de Decembre, Quito, Ecuador. Tel.: (593-2) 521-436. Tripetrol: Five Post Oak Park, Suite 2360, Houston, TX 77027. Tel.: (713) 877-8733, Fax: (713) 877-1723. Loading Port Esmeraldas. 01.00 N. 79.39 W. The Esmeraldas terminal, located on the coast in northern Ecuador, has two loading berths designed to accommodate vessels up to 200 meters in length and 10.5 m (35 feet) maximum draft.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F

ORIENTE ASSAY Crude Oil Value Specifications 28.8 Sulfur Content 7.132 Pour Point 13.5 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 1.02 -3 4.5

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 1.5 1 Light Naphtha <85 5.1 3.9 Light Naphtha <185 Octane RON Int. Naphtha 85-165 11.7 10 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 11.3 10.3 Kerosine 329-455 Sulfur Content Light Gas Oil 235-300 11.7 11.3 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 10 9.9 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Residue >350 49 53.6 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Vanadium Year Of Crude Oil Sample: 1981 Nickel ORIENTE TERM CONTRACT PRICES, 1986-93 At Port Of Loading In Dollars Per Barrel Month 1986 1987 1988 1989 1990 1991 Jan. $21.00 $17.95 $14.14 $14.68 $19.02 $19.84 Feb. 14.00 17.02 13.54 14.83 18.53 14.58 March 12.40 17.02 13.00 16.16 17.09 16.11 April 12.20 17.02 14.88 18.34 13.50 16.65 May 13.80 17.02 13.94 16.46 13.00 16.94 June 11.55 17.02 13.30 15.87 12.17 15.97 July 9.75 17.02 12.85 15.82 12.41 17.09 Aug. 13.45 17.02 12.65 15.04 22.44 17.35 Sept. 13.45 17.02 11.42 15.58 29.76 18.11 Oct. 13.65 18.45 10.33 16.57 30.61 18.98 Nov. 13.85 17.40 10.23 16.77 28.00 17.83 Dec. 15.10 15.50 12.85 18.28 23.45 15.34 ORIENTE SPOT PRICES, 1988-93 Delivered To US Gulf Coast In Dollars Per Barrel Month 1988 1989 1990 1991 1992 1993 Jan. $17.95 $15.45 $16.50 $22.90 $15.85 $16.55 Feb. 16.90 14.65 16.65 17.05 15.90 18.30 March 17.45 14.10 17.90 18.00 16.25 18.15 April 15.35 20.05 15.00 18.45 17.65 18.05 May 15.45 18.15 14.75 17.45 18.45 17.55 June 14.70 17.50 13.40 17.40 20.55 16.60 July 14.65 17.50 15.95 18.15 19.75 15.30 Aug. 14.00 16.55 25.70 18.40 18.85 15.60 Sept. 13.05 17.10 32.20 19.05 19.30 15.15 Oct. 11.80 17.90 32.90 20.10 19.65 15.55 Nov. 11.80 18.25 30.65 19.40 18.60 13.55 Dec. 14.30 19.80 26.05 16.85 17.55 11.75
Note: More recent prices can be found in Chapter I.

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C % Wt. Temp. C/F Cen at 60 C % Wt. Parts/mill. Parts/mill.

Value 71 44 48 8 0.06 0.46 -22 47.4 0.85 1 52.8 1.62 33/91.4 648 9 145 67

1992 $14.67 14.75 14.88 16.36 17.27 19.09 18.25 17.45 17.92 18.05 16.82 15.84

1993 $15.20 16.52 16.59 16.42 15.77 14.84 13.66 14.16 13.41 13.88 12.07 10.18

CRUDE OIL HANDBOOK

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H93

BELAYIM BLEND
Gravity: 26.1 Sulfur: 2.23

Egypt
Loading Port: Wadi El Firan

Production 200,000 barrels a day from both onshore and offshore fields in the Gulf Of Suez. Original discovery of Belayim Marine field in 1955 by Agip. Output has been maintained at these levels after steady increases in the late 1980s and early 1990s. Quality Heavy, high-sulfur crude oil with high metals content, similar to heavier Venezuelan and Mexican grades. Producers Petrobel: a joint venture operated by state EGPC (50%), Italian Agip (35%), and local interests (15%). Pricing And Marketing The EGPC term price formula was changed to direct Brent linkage in January 1996 due to dissatisfaction with the earlier basket mechanism. EGPC has increased its terms sales on the international market and reduced usage in domestic refineries as it seeks to make more light products. It has also reduced its reliance on traders and increased sales to refiners. Agip takes almost all of its 60,000-70,000 b/d share of production about four cargoes a month into its Italian refinery system. Sellers EGPC: Osman Abdel Hafiz St., Nasr City, PO Box 2130, Cairo, Egypt. Tel.: (20) 603-899. Agip Spa: 89-91 Via del Serafico, Rome 00142, Italy. Tel.: (39-6) 503-921, Fax: (39-6) 503-922-41/503-923-20. Loading Port Wadi El Firan. 28.44 N. 33.13 E. The terminal is located on the Sinai coast in the Gulf of Suez in the Red Sea about 100 miles south of Suez. Loading facilities include three berths. Maximum draft and deadweight tons are the following: Berth 1, 75 feet and 50,000 dwt; Berth 2, 58 ft and 50,000 dwt; Berth 3, 65 ft and 80,000 dwt.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. C/F

BELAYIM BLEND ASSAY Crude Oil Value Specifications 26.1 Sulfur Content 7.012 Pour Point 29.5 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 2.23 9 4.5

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 1.5 0.9 Light Naphtha <85 4.7 3.5 Light Naphtha <185 Octane RON Int. Naphtha 85-165 12 10 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 8.7 7.8 Kerosine 329-455 Sulfur Content Light Gas Oil 235-300 9.9 9.3 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 7.7 7.4 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 56 61 Residue >662 Sulfur Content Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1977 Nickel

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C Cen at 100 F % Wt. Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 65 55 33 12 0.46 1.07 -18 49.8 1.91 14 54.8 6.4 3.18 761 7.32 14.74 161 86

BELAYIM BLEND TERM-CONTRACT PRICES, 1979-93 At Port Of Loading In Dollars Per Barrel Month 1979 1980 1981 1982 1983 1984 1985 Jan. $12.23 $29.00 $37.00 $30.50 $28.00 $26.50 $25.60 Feb. 12.23 29.00 37.00 28.65 27.00 25.00 25.75 March 15.05 29.00 37.00 28.00 25.25 26.75 25.75 April 15.32 29.00 35.50 28.00 25.25 25.60 25.75 May 15.32 29.00 33.00 28.00 25.75 25.60 26.00 June 17.60 29.00 33.00 28.50 26.00 25.60 23.00 July 26.50 29.00 30.00 28.50 26.25 25.60 24.25 Aug. 26.50 29.00 30.00 28.50 26.25 25.60 24.25 Sept. 26.50 29.00 30.00 28.50 26.75 25.60 24.55 Oct. 26.50 29.00 30.00 28.60 26.75 25.60 25.00 Nov. 26.50 29.00 31.40 29.00 26.75 25.60 25.00 Dec. 28.00 31.00 31.00 28.75 26.75 25.60 25.45 Month 1986 1987 1988 1989 1990 1991 1992 Jan. $21.50 $16.52 $14.60 $13.28 $18.28 $20.11 $13.11 Feb. 18.00 16.84 14.58 13.90 17.35 15.66 13.16 March 12.50 16.65 12.78 14.85 15.70 15.17 12.79 April 11.75 16.65 13.70 16.55 12.93 15.33 14.28 May 11.25 16.65 14.43 16.67 13.58 14.54 15.28 June 11.25 16.65 13.75 14.80 11.65 13.78 16.49 July 11.25 16.90 11.90 15.03 12.15 14.75 15.72 Aug. 10.44 17.63 12.85 14.15 24.11 15.35 15.26 Sept. 12.05 16.32 11.53 14.73 35.10 16.03 15.88 Oct. 11.68 15.85 10.30 16.15 33.02 17.49 16.09 Nov. 12.83 15.55 10.05 16.15 29.15 16.24 15.24 Dec. 13.58 15.05 11.90 17.28 23.05 13.21 14.16
Note: More recent prices can be found in Chapter I.

1993 $13.01 13.72 13.96 13.89 13.74 12.85 12.07 12.15 11.68 12.37 11.08 9.66

CRUDE OIL HANDBOOK

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H95

RAS BUDRAN
Gravity: 24.3 Sulfur: 2.39

Egypt
Loading Port: Ras Budran

Production Output is in decline, with less than 20,000 barrels a day in 1995 from the Ras Budran offshore field along the northern Sinai Coast of the Gulf of Suez. Quality A heavy, high-sulfur crude oil with high metals content, similar in quality to heavy Mexican and Venezuelan crude oils. Producers Suez Oil Co. (Suco): state EGPC (50%), with the remaining 50% shared equally among Shell, Repsol, and Deminex. Pricing And Marketing The EGPC term price formula was changed to direct Brent linkage in January 1996 due to dissatisfaction with the earlier basket mechanism. Use of these heavier crude oils in EGPC refineries has been reduced in favor of lighter Suez Blend in order to produce more light products. The crude oils primary markets are in the Mediterranean and with sophisticated US refiners. Sellers EGPC: Osman Abdel Hafiz St., Nasr City, PO Box 2130, Cairo, Egypt. Tel.: (20) 603-899. Loading Port Ras Budran. 26.56 N. 33.08 E. The crude oil-loading facilities at Ras Budran in the Red Sea consist of one single-buoy mooring. Size restrictions are 250,000 deadweight tons and draft of 27.4 meters.

H96

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <85 <185 85-165 185-329

RAS BUDRAN ASSAY Crude Oil Value Specifications 24.3 Sulfur Content 6.931 Pour Point 52.06 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 2.39 9 5 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 1.8 1.1 5.3 3.9 9.4 7.8 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

65 51 37 12 0.43 -55 1.23 -24 49 1.8 4 54.2 5.74 3.24 39/102.2 3,783 13.22 15.79 119 128

Kerosine

165-235 329-455 235-300 455-572

8.6

7.6

Light Gas Oil

9.1

8.5

Int. Gas Oil

300-350 572-662

7.9

7.5

% Wt. Temp. C Cen at 100 F % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

58.2

63.6

Year Of Crude Oil Sample: 1987 At Port Of Loading In Dollars Per Barrel Month 1987 1988 1989 Jan. $16.02 $14.10 $12.13 Feb. 16.27 13.60 12.75 March 16.00 12.28 13.70 April 16.00 13.00 15.10 May 16.00 13.20 15.22 June 16.15 12.85 13.35 July 16.40 10.75 13.58 Aug. 17.13 11.70 13.00 Sept. 15.82 10.38 13.58 Oct. 15.35 9.15 14.70 Nov. 14.95 8.90 14.70 Dec. 14.55 10.75 16.13
Note: More recent prices can be found in Chapter I.

RAS BUDRAN TERM-CONTRACT PRICES, 1987-93 1990 $17.13 16.20 14.55 11.78 12.43 10.50 11.00 22.96 33.95 31.77 28.00 22.90 1991 $18.96 14.51 14.02 14.18 13.24 12.48 13.45 15.05 15.73 17.29 16.04 11.91 1992 $11.51 11.56 11.19 12.68 13.68 14.89 14.12 13.76 14.38 14.59 13.74 12.66 1993 $11.66 12.47 12.90 12.84 12.74 11.90 11.22 11.35 10.88 11.57 10.33 8.86

CRUDE OIL HANDBOOK

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H97

RAS GHARIB BLEND


Gravity: 24.1 Sulfur: 3.00 Other Names: Ras Gharib, Gharib Blend

Egypt
Loading Port: Ras Gharib

Production About 25,000 barrels a day from the Gharib field and others nearby on the west side of the Gulf Of Suez. The Gharib field is Egypts oldest. It was discovered in 1938, and it still produces 5,000 b/d. Quality A heavy, high-sulfur crude oil similar in quality to heavier Mexican and Venezuelan crude oils. It is now slightly lighter than the sample below. Producer General Petroleum Co. (GPC): an affiliate of state EGPC. Operated by Gulf Of Suez Petroleum Co. (Gupco), a joint venture between Amoco and EGPC. Pricing And Marketing The EGPC term price formula was changed to direct Brent linkage in January 1996 due to dissatisfaction with the earlier basket mechanism. Ras Gharib has long been one of EGPCs primary export grades after Suez Blend, with most sales on a term-contract basis. Its primary markets are in the Mediterranean and with sophisticated US refiners. Seller EGPC: Osman Abdel Hafiz St., Nasr City, PO Box 2130, Cairo, Egypt. Tel.: (20) 603-899. Loading Port Ras Gharib. 28.21 N. 33.07 E. Located in the Gulf of Suez with two piers for crude oil tankers. Pier 2 is for ships up to 30,000 deadweight tons with maximum draft of 36 feet. New Pier is for ships up to 100,000 dwt and maximum draft of 78 ft.

H98

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F 55-175 175-300 Yield % Vol. 0.4 2.9 7.6

RAS GHARIB BLEND ASSAY Crude Oil Value Specifications 22 Sulfur Content 6.838 Pour Point 70

Unit % Weight Temp. F

Value 3.1 50

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Naphthenes Aromatics Heavy Naphtha Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F % Wt. Cen at 50 C % Wt. Temp. F Cen at 50 C

67 36 9 42 14 1.24 -42 2.23 48 3.77 4.03 88 6,100

Heavy Naphtha

300-400

Kerosine

400-500

7.4

Gas Oil

500-650

12.6

Residue

>650

62.1

Year Of Crude Oil Sample: 1983 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. ... $11.40 $24.00 Feb. ... 11.40 24.00 March ... 14.06 24.00 April ... 14.33 24.00 May ... 14.33 24.00 June ... 16.90 24.00 July ... 21.00 24.00 Aug. ... 21.00 24.00 Sept. ... 21.00 24.00 Oct. $10.73 21.00 24.00 Nov. 10.73 21.00 24.00 Dec. 10.73 24.00 26.00 Month 1986 1987 1988 Jan. $19.70 $15.40 $13.50 Feb. 16.50 15.72 14.15 March 11.25 15.40 11.68 April 11.25 15.40 12.35 May 10.60 15.40 14.00 June 10.60 15.55 12.15 July 10.60 15.80 10.45 Aug. 9.19 16.53 11.40 Sept. 10.00 15.22 10.08 Oct. 10.43 14.75 8.85 Nov. 10.65 14.45 8.60 Dec. 12.33 13.95 10.45
Note: More recent prices can be found in Chapter I.

RAS GHARIB BLEND TERM CONTRACT PRICES, 1978-93 1981 $32.00 32.00 32.00 31.50 30.00 30.00 27.00 27.00 27.00 27.00 28.30 28.00 1989 $11.83 12.45 13.40 15.40 15.52 13.65 13.88 12.70 13.28 15.00 15.00 15.83 1982 $27.80 26.65 26.00 26.00 26.00 26.50 26.50 26.50 26.50 26.50 26.75 26.25 1990 $16.83 15.90 14.25 11.48 12.13 10.20 10.70 22.66 33.65 31.47 27.70 22.60 1983 $26.00 25.00 23.00 23.00 23.25 23.25 23.50 23.50 24.50 24.50 24.50 24.50 1991 $18.66 14.21 13.72 13.88 13.09 12.33 13.30 14.90 15.58 17.29 14.79 11.96 1984 $24.65 25.00 25.00 25.60 25.60 25.60 25.60 25.60 25.60 25.60 25.60 25.60 1992 $11.21 11.26 10.89 12.28 13.28 14.49 13.72 13.26 13.88 14.09 13.24 12.16 1985 $25.60 25.75 25.75 25.75 25.00 23.00 22.25 22.25 23.25 23.50 23.50 23.85 1993 $11.11 11.82 12.10 12.04 11.94 11.10 10.42 10.55 10.08 10.77 9.53 8.06

CRUDE OIL HANDBOOK

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H99

SUEZ BLEND
Gravity: 31.5 Sulfur: 1.54 Other Names: El Morgan, Gulf of Suez

Egypt
Loading Port: Ras Shukheir

Production About 400,000 barrels a day, from the main fields of Morgan, October, and Ramadan. Output is declining gradually, but still represents almost half of Egypts total production. Quality A medium-gravity, sour crude oil similar in quality to Arabian Light and Russian Urals. Usually referred to as a 33-gravity crude oil, although it is actually somewhat heavier, as the test below indicates. Producers Gulf Of Suez Petroleum Co. (Gupco), in which Amoco and state EGPC each have 50% equity ownership. Pricing And Marketing Suez Blend exports have been declining as EGPC has refined more of it locally in order to expand light products output. As a result, exports have dwindled to about 175,000 b/d from about 225,000 b/d in the early 1990s. EGPC only exports about 50,000 b/d against total EGPC crude oil sales of 170,000-180,000 b/d. Amoco sells about 75% of its 125,000 b/d of exports on a term-contract basis, with the remainder sold spot. Spot trading has declined with reduced exports and a greater emphasis on term sales to refiners, reducing the role of Suez Blend as a Mediterranean spot benchmark grade. EGPC term contract prices moved to a simple dated Brent formula in January 1996, when the old crude oil basket system was abandoned. Sellers EGPC: Osman Abdel Hafiz St., Nasr City, PO Box 2130, Cairo, Egypt. Tel.: (20) 603-899. Amoco Shipping and Trading: 140 Park Lane, Suite 23, London SW1X 9NE, UK. Tel.: (44-171) 408-1750, Fax: (44-171) 409-0785. Main Customers Egypts largest customer is Israel, but EGPC also maintains about 15 term contracts, including major oil companies and Mediterranean refiners. Chevron and Shell dropped out in 1996. Volumes also regularly move to India and other Asian destinations. Loading Port Ras Shukheir. 28.08 N. 33.17 E. The terminal is on the western coast of the Gulf Of Suez and consists of two sea berths. Maximum draft is 25.6-27.4 meters, with maximum length of 305 meters.

H100

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <5/<41 <85 <185 85-165 185-329

SUEZ BLEND ASSAY Crude Oil Value Specifications 31.5 Sulfur Content 7.255 Pour Point 5.4 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 1.54 3 6.1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 2.5 1.6 Light Naphtha 6.6 5.1 Light Naphtha Octane RON Int. Naphtha 12.3 10.6 Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine 165-235 11.6 10.7 Kerosine 329-455 Sulfur Content Light Gas Oil 235-300 10.7 10.4 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 8.8 8.8 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Residue >350 47.7 52.8 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1984 Nickel SUEZ BLEND SPOT PRICES, 1986-93 At Port Of Loading In Dollars Per Barrel Month 1986 1987 1988 1989 1990 1991 Jan. $22.70 $17.12 $15.45 $14.13 $19.13 $20.96 Feb. 19.00 17.44 15.00 14.75 18.20 16.51 March 13.50 17.25 13.63 15.70 16.55 16.02 April 12.50 17.25 14.55 17.40 13.78 16.18 May 12.00 17.25 14.85 17.52 14.42 15.94 June 11.00 17.25 14.60 15.65 12.50 15.18 July ... 17.55 12.75 15.88 13.00 16.15 Aug. 11.16 18.33 13.70 15.00 24.96 16.75 Sept. 12.80 17.10 12.38 15.58 35.95 17.43 Oct. 12.42 16.70 11.15 17.00 33.87 19.29 Nov. 12.40 16.40 10.90 17.00 30.00 18.04 Dec. 14.18 15.90 12.75 18.12 24.90 15.11 Month Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. 1987 $16.95 16.25 16.65 17.00 17.15 17.25 17.95 17.55 16.65 16.70 15.70 14.80

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 67 49 40 11 0.2 0.8 -18 50.7 1.38 5 54.4 2.39 36/96.8 244 4.13 9.84 75 45

1992 $15.06 15.11 14.74 16.13 17.08 18.24 17.42 16.91 17.48 17.64 16.74 15.56

1993 $14.41 15.22 15.44 15.34 15.19 14.25 13.47 13.55 13.08 13.72 12.43 11.01

SUEZ BLEND TERM-CONTRACT PRICES, 1987-93 1988 1989 1990 1991 1992 1993 $14.95 $14.50 $18.85 $20.25 $15.05 $14.15 14.25 14.40 17.30 16.50 15.10 15.10 12.95 16.20 15.70 15.85 14.70 15.55 14.55 17.95 13.55 16.00 16.25 15.30 14.40 16.50 13.20 15.85 17.10 15.10 13.50 15.20 11.70 14.60 18.20 14.75 12.85 15.25 13.95 16.00 17.45 13.45 12.85 14.50 25.00 16.55 16.85 13.55 11.05 15.55 33.80 17.45 17.40 13.00 10.15 16.65 33.20 19.20 17.75 13.65 10.75 16.40 29.30 18.10 16.70 12.40 13.15 17.50 24.35 15.15 15.35 10.90

Note: More recent prices can be found in Chapter I.

CRUDE OIL HANDBOOK

PIW

H101

ZEIT BAY
Gravity: 33.8 Sulfur: 1.35

Egypt
Loading Port: Zeit Bay

Production Output is declining and was less than 20,000 barrels a day in 1995 from a group of offshore fields at the southern end of the Gulf of Suez. Quality A medium, sour crude oil that is slightly higher in quality than benchmark Suez Blend. Producers Suez Oil Co. (Suco): state EGPC (50%), with the remaining 50% shared equally among Shell, Repsol, and Deminex. Pricing And Marketing The EGPC term price formula was changed to direct Brent linkage in January 1996 due to dissatisfaction with the earlier basket mechanism. Use of lighter grades such as Zeit Bay has been increased in EGPC refineries in order to produce more light products, which limits export availabilities. The crude oils primary markets are in the Mediterranean. Sellers EGPC: Osman Abdel Hafiz St., Nasr City, PO Box 2130, Cairo, Egypt. Tel.: (20) 603-899. Loading Port Zeit Bay. 27.50 N. 33.36 E. Located about 35 miles north of Hurgada in the Red Sea, the terminal is equipped with one single-buoy mooring. The maximum vessel size is 240,000 deadweight tons.

H102

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <5/<41 <85 <185 85-165 185-329

ZEIT BAY ASSAY Crude Oil Value Specifications 33.8 Sulfur Content 7.355 Pour Point 5.73 Reid Vapor Press.

Unit % Wt Temp. C Lbs/Sq. In.

Value 1.35 -6 8.3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 3.8 2.5 9.3 7.2 15.5 13.8 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

70 45 34 21 0.3 -56 0.6 -20 48.1 1 2 54.5 5.79 2.36 33/91.4 258 3.17 9.5 70 60

Kerosine

165-235 329-455 235-300 455-572

11.1

10.6

Light Gas Oil

10.8

10.6

Int. Gas Oil

300-350 572-662

7.6

7.7

% Wt. Temp. C 104 F % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

42.6

47.5

Year Of Crude Oil Sample: 1986

CRUDE OIL HANDBOOK

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H103

LUCINA
Gravity: 39.2 Sulfur: 0.03

Gabon
Loading Port: Lucina

Production A small offshore stream of 8,000 barrels a day of light, sweet crude oil. Output comes from the two Lucina fields and adjacent MBaya, which was tied in by pipeline in 1996. Quality Gabons highest-quality oil is somewhat less attractive than other top West African crude oils such as Nigerian Bonny Light because of its high wax content and pour point. The assay is for Lucina with MBaya slightly heavier at 36-gravity. Producers Perenco (formerly Kelt) is the operator with 90% and the government holds the remaining 10%. The fields were acquired from Elf, Shell, and Repsol in 1994-95. Pricing And Marketing Cargoes are priced at a differential to dated Brent, with a typical discount of 25-50 a barrel. Lucina is sold in 50,000- to 100,000-ton parcels on the spot market, usually into Europe. Sellers Perenco (formerly Kelt): 130 Jermyn Street, London SW1Y 4UJ, UK. Tel. (44-171) 9309861. Fax: (44-171) 873-0908. Loading Port Lucina. 03.40 S. 10.46 E. The terminal is in the South Atlantic and consists of a singlebuoy mooring located 1 kilometer from the floating-storage vessel that is moored near the offshore production platforms. No limitation on tanker size.

H104

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <5/<41 5-85 41-185 85-165 185-329

LUCINA ASSAY Crude Oil Value Specifications 39.2 Sulfur Content 7.597 Pour Point 4.82 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.03 18 6.5

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 2.5 1.7 7.7 6.3 14.5 13.1 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C

64 52 37 11 <0.01 0.01 -14 57.6 0.03 9 62.3 5.7 0.06 42/107.6 51.4 <0.05 3.19 <1 31

Kerosine Light Gas Oil

165-235 329-455 235-300 455-572

13.1 12.9

12.5 12.9

Int. Gas Oil

300-350 572-662

9.8

10

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

40

43.5

Year Of Crude Oil Sample: 1983

CRUDE OIL HANDBOOK

PIW

H105

MANDJI
Gravity: 30.2 Sulfur: 1.14

Gabon
Loading Port: Cape Lopez

Production About 120,000 barrels a day of offshore output from several fields, and Gabons secondlargest stream after the onshore Rabi system. Quality A medium-gravity crude oil with a higher sulfur content than most West African grades. Similar in quality to US Alaskan North Slope. Quality may vary as new streams are brought on and old ones decline. Producers Elf-Gabon: a joint venture between French Elf Aquitaine (75%) and the government (25%). Pricing And Marketing Sales are tied to a dated Brent formula with a discount of about $2-$2.75 a barrel. Elf handles all of the marketing, and the firm also sometimes takes significant volumes into its own refining system. Volumes are increasingly being sold into Asia. Sellers Elf Trading: World Trade Center, 10 Route de lAeroport, 1215 Geneva 15 Airport, Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110. Loading Port Cape Lopez. 00.38 S. 08.43 E. The terminal, located about 100 miles south of Libreville, is designed for tankers of up to 250,000 deadweight tons with maximum drafts of 67 feet (20.5 meters).

H106

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <5/<41 5-85 41-185 85-165 185-329

MANDJI ASSAY Crude Oil Value Specifications 30.2 Sulfur Content 7.197 Pour Point 13.9 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 1.14 12 4.3 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 1.5 1 Light Naphtha 5.1 4.1 Light Naphtha Octane RON Int. Naphtha 11.3 9.7 Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine 165-235 10.4 9.5 Kerosine 329-455 Sulfur Content Freezing Point Light Gas Oil 235-300 11.2 10.7 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 9.2 9 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 51.2 56.1 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1988 Nickel

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C % Wt. Temp. C Cen at 40 C % Wt. Temp. F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 71 51 40 9 0.13 -55 0.33 -24 53.8 0.59 -3 57.7 5.98 1.69 99 334 2.12 7.81 107 96

MANDJI OFFICIAL GOVERNMENT SELLING PRICES, 1978-85 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 1981 1982 1983 1984 Jan. $12.70 $13.23 $28.00 $35.00 $30.50 $33.00 $26.50 Feb. 12.70 13.23 30.00 35.00 28.65 27.00 25.00 March 12.70 15.05 30.00 35.00 28.00 29.00 26.75 April 12.70 16.00 30.00 35.50 28.00 29.00 25.60 May 12.70 16.80 32.00 33.00 28.00 25.75 25.60 June 12.70 18.10 32.00 33.00 28.50 26.00 25.60 July 12.70 22.00 32.00 30.00 28.50 26.25 25.60 Aug. 12.70 22.00 32.00 30.00 28.50 26.25 25.60 Sept. 12.70 22.00 32.00 30.00 28.50 26.75 25.60 Oct. 11.57 22.00 32.00 30.00 28.60 26.75 25.60 Nov. 11.57 24.50 32.00 31.30 29.00 26.75 25.60 Dec. 11.57 28.00 31.00 31.00 28.75 26.75 25.60 MANDJI SPOT PRICES, 1986-93 At Port Of Loading In Dollars Per Barrel Month 1986 1987 1988 1989 1990 1991 Jan. $21.50 $17.35 $14.75 $15.40 $19.45 $20.35 Feb. 18.00 17.32 13.60 15.25 17.75 16.25 March 12.50 17.32 12.75 16.95 16.25 15.05 April 11.75 17.32 13.65 18.60 13.70 15.50 May 11.25 17.32 14.20 17.05 13.40 15.25 June 10.50 17.32 13.35 16.00 11.80 14.70 July 7.95 17.32 13.15 15.85 14.15 15.85 Aug. 11.90 17.32 12.70 14.85 25.15 16.45 Sept. 12.40 17.32 11.30 16.00 32.10 17.35 Oct. 12.30 17.32 10.60 17.15 32.60 19.45 Nov. 12.80 17.32 11.25 16.90 28.90 18.25 Dec. 14.25 17.32 13.65 18.00 24.00 15.25
Note: More recent prices can be found in Chapter I.

1985 $28.00 25.75 25.75 25.75 26.00 23.00 24.25 24.25 24.55 25.00 25.00 25.45

1992 $15.00 15.25 14.85 16.45 17.40 18.60 17.90 17.55 18.00 18.15 17.15 16.00

1993 $14.60 15.65 16.10 16.15 16.20 15.40 14.65 14.30 13.70 14.50 13.10 11.65

CRUDE OIL HANDBOOK

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H107

RABI

Gabon

Gravity: 34.6 Sulfur: 0.06 Loading Ports: Gamba (Shell), Cape Lopez (Elf) Other Names: Rabi Kounga, Rabi Export Blend, Rabi Light Production At 220,000 barrels a day in 1996, Rabi is still Gabons largest and most important producing area. The fields are undergoing infill drilling and other efforts to maintain flows, but output is expected to decline gradually in the years ahead. The area lies 60 miles inland, with several adjacent fields contributing to the export streams. It is split into two slightly different streams for export. Shells Rabi Export Blend is mixed with heavier 31gravity Gamba crude oil and other lighter streams, while Elfs Rabi Light is not. Quality A medium-gravity, low-sulfur crude oil with relatively high wax content, making it similar to Angolan Cabinda but of higher quality. The test below is representative of Elfs Rabi Light stream rather than Shells Rabi Export Blend, but both are quite similar. Producers Shell-Gabon (75% Royal Dutch/Shell, 25% government) and Elf-Gabon (75% French Elf Aquitaine, 25% government) are the dominant partners, and they operate different parts of the producing area. Shares are Elf-Gabon (48%), Shell-Gabon (32%), state Petrogab (15%), and Amerada Hess (5%). Pricing And Marketing Rabi is usually priced at a differential to Brent even though most volumes go to the US or Asia. It is sold regularly on a spot market basis by both Shell and Elf. Shell sells its output from the loading port of Gamba in central Gabon, while Elf pipes its barrels to Cape Lopez, 110 miles northwest. Both grades typically sell at a discount to Brent of 1020 a barrel. Sellers Royal Dutch/Shell: Shell International Trading And Shipping Co. (Stasco), Shell-Mex House, Strand, London WC2R 07A, UK. Tel.: (44-171) 546-1234, Fax: (44-171) 546-4448. Elf Trading: World Trade Center, 10 Route de lAeroport, 1215 Geneva 15 Airport, Switzerland. Tel.: (41-22) 710-1112, Fax: (41-22) 710-1110. Main Customers Rabi is actively traded in the Atlantic Basin and the Far East, but it appeals to specific end-users because of its quality. Exxon, Chevron, Phibro, British Petroleum, and Coastal have been among the largest US buyers. But since late 1992, Rabi has also moved to the Far East as a substitute for similar quality Asian grades. Loading Ports Gamba. 02.50 S. 09.56 E. This Shell operated terminal consists of a single-buoy mooring for vessels up to 130,000 deadweight tons with maximum draft of 41 feet (12.5 meters). Cape Lopez. 00.38 S. 08.43 E. This Elf terminal, located about 100 miles south of Libreville, is designed for tankers of up to 250,000 dwt with maximum drafts of 67 ft (20.5 m).

H108

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <5/<41 <85 <185 85-165 185-329

RABI ASSAY Crude Oil Value Specifications 34.6 Sulfur Content 7.391 Pour Point 12.9 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 0.06 33 3.3 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 0.8 0.5 2.7 2.2 7.9 7.1 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C

77 31 61 8 <0.01 0.01 -21 57.7 0.04 -11 61.9 5.78 0.09 42/107.6 66.7 0.03 4.06 <1 19

Kerosine Light Gas Oil

165-235 329-455 235-300 455-572

12.9 12.1

12.1 11.7

Int. Gas Oil

300-350 572-662

9.8

9.7

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

53.7

56.7

Year Of Crude Oil Sample: 1986

CRUDE OIL HANDBOOK

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H109

ARDJUNA
Gravity: 36.7 Other Names: Arjuna Sulfur: 0.09

Indonesia
Loading Port: Ardjuna

Production Output of about 80,000 barrels a day in 1995 from some 20 small offshore fields on the northern edge of western Java. Arimbi and Bima crude oil streams also come from the same block. Production peaked in the mid-1980s, and it is expected to drop to about 50,000 b/d by 2000, even with enhanced-recovery efforts. Quality Typical light Asian crude oil with little sulfur but high wax content. The high-pour-point residual oil is viscous and difficult to handle even by Indonesian standards. Producers Operator Arco (46%), Maxus (24.3%), Repsol (12.3%), Inpex (7.3%), Deminex (5%), Itochu (2.6%), Warrior Oil (2.4%). Production split is 85-15 in favor of Pertamina after allowing for cost-recovery oil going to producers and excluding set volumes that producers must sell to the domestic market at discounted prices. Pricing And Marketing Exports amount to no more than 15,000-20,000 b/d as compared to 40,000 b/d in the mid-1980s. The drop is due to declining production and greater use of the crude oil in Indonesian refineries. Pricing is based on a complex retroactive formula known as the ICP, or Indonesian Contract Price. This formula has two components of equal weight. The first component is linked to the average prices for five spot crude oils Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of Ardjuna spot prices over the month in Platt's and Rim. These two components are averaged to arrive at the final ICP price. Sellers In addition to any volumes sold by equity producers, Pertamina sells the crude oil via four marketing affiliates. For sales to Japan, Indonesias largest market, Pacific Petroleum And Trading Company is used, a 50-50 joint ventures between Pertamina and Japanese buyers. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), and sales to China go through Perta. Pacific Petroleum And Trading Company: East Tower 11F, Akasaka Twin Tower, 17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: (81-3) 5562-6504. Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul, Korea 10010. Tel: (822) 752-0592. Fax: (822) 752-0596. Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong. Tel: (852-5) 260-341. Fax: (852-5) 2519-8909. Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel: (62-21) 525-0120. Loading Port Ardjuna. 05.54 S. 107.44 E. This open mooring in the Java Sea, situated 18.5 miles off the north coast of Java, has a total of four single-buoy mooring berths intended for crude oil loading. It is designed for tankers of up to 200,000 deadweight tons. Crude oil is stored in storage tankers Arco Ardjuna, Ardjuna Sakti, and Cempaka Nusantra.

H110

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. C <100 100-150 Yield % Vol. 14.3 13

ARDJUNA ASSAY Crude Oil Value Specifications 36.7 Sulfur Content 7.5 Pour Point 5.27 Reid Vapor Press.

Unit % Weight Temp. F Lbs/Sq. In.

Value 0.09 70 6.6

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Smoke Point Freezing Point Gas Oil Cetane Index Residue Sulfur Content Pour Point Unit Clear Octane % Wt. % Wt. % Wt. mm Temp. C Value 75.2 35 44 21.5 14 -54 43.9 % Wt. Temp. F 0.17 120

Kerosine

150-250

19.3

Gas Oil Residue

250-350 >350

22.4 31

Year Of Crude Oil Sample: 1991 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. $13.70 $14.40 $28.95 Feb 13.70 14.40 30.95 March 13.70 14.40 30.95 April 13.70 16.45 30.95 May 13.70 17.20 32.95 June 13.70 19.70 32.95 July 13.70 21.56 32.95 Aug. 13.70 21.56 32.95 Sept. 13.70 21.56 32.95 Oct. 13.70 21.56 32.95 Nov. 13.70 23.50 32.95 Dec. 13.70 26.70 32.95 Month 1986 1987 1988 Jan. $28.65 $17.55 $18.09 Feb. 28.65 18.09 18.09 March 12.85 18.09 17.99 April 11.00 18.09 16.53 May 12.25 18.09 17.13 June 11.75 18.09 16.98 July 9.85 18.09 16.98 Aug. 12.10 18.09 15.33 Sept. 13.70 18.09 15.33 Oct. 13.65 18.09 13.73 Nov. 13.75 18.09 12.63 Dec. 14.65 18.09 13.03
Note: More recent prices can be found in Chapter I.

ARDJUNA OFFICIAL TERM-CONTRACT PRICES, 1978-93 1981 $36.45 36.45 36.45 36.45 36.45 36.45 36.45 36.45 36.45 36.45 36.45 36.45 1989 $15.53 18.09 18.09 18.47 18.88 18.29 18.17 17.39 17.21 17.61 18.13 18.35 1982 $36.45 36.45 36.45 36.45 36.45 36.45 36.45 36.45 36.45 36.45 35.20 35.20 1990 $19.47 19.51 18.97 17.63 16.46 15.71 14.95 19.32 28.15 35.39 33.64 29.07 1983 $35.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 1991 $25.59 21.98 17.97 17.65 19.29 18.59 18.36 19.80 19.29 20.85 21.50 20.86 1984 $30.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 30.20 1992 $18.89 18.47 17.97 18.07 18.83 20.18 21.38 20.94 20.38 20.46 20.14 19.31 1985 $30.20 28.65 28.65 28.65 28.65 28.65 28.65 28.65 28.65 28.65 28.65 28.65 1993 $18.40 17.96 18.84 19.23 18.99 18.62 17.57 17.65 17.07 17.17 16.12 14.58

CRUDE OIL HANDBOOK

PIW

H111

ARUN CONDENSATE
Gravity: 54.3 Sulfur: >0.01

Indonesia
Loading Port: Lhokseumawe

Production About 90,000 barrels a day in association with gas produced for Arun liquefied natural gas exports, and volumes have been declining as the gas becomes drier. Output is expected to hit 20,000 b/d or so by 2000. Quality A high-quality, naphtha-rich condensate excellent for gasoline manufacturing or blending with heavy crude oils to improve refined product yield. Producer Operated by Mobil under a production-sharing contract with state Pertamina. Production is split 70-30 in favor of Pertamina. Pricing And Marketing Almost the entire production is exported, making it the third-largest export stream after Minas and Duri, with a wide range of buyers. Mobil handles sales on behalf of Pertamina. Since liquids production is linked to LNG facilities, output cannot be shut in without disrupting gas supply. Pricing is based on a complex retroactive formula known as the ICP, or Indonesian Contract Price. This formula has two components of equal weight. The first component is linked to the average prices for five spot crude oils Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of spot prices over the month in Platt's and Rim. The two components are averaged to arrive at the final ICP price. Sellers In addition to absorbing supplies within its own refining system, Mobil markets about 30,000-40,000 b/d to third parties, acting as a marketing agent for Pertamina. Pertamina also sometimes sells about 10,000-20,000 b/d through its Japanese marketing affiliate (see Ardjuna for details). Mobil Sales & Supply Corp., Singapore: 18 Pioneer Road, 2262 Singapore. Tel.: (65) 660-6401, Fax: (65) 264-1693. Loading Port Lhokseumawe. 05.15 N. 97.07 E. The terminal is located on the north coast of Sumatra, and it contains several oil-loading berths, in addition to LNG-loading facilities. The single-buoy mooring facility is designed for tankers of 40,000-280,000 deadweight tons.

H112

PIW

CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 104 F Cut Points Temp. C <100 100-150 Yield % Vol. 7.3 24.1 31.7

ARUN CONDENSATE ASSAY Crude Oil Value Specifications 54.3 Sulfur Content 8.28 Pour Point 0.83 Reid Vapor Press.

Unit % Weight Temp. F Lbs/Sq. In.

Value 0.002 -20 9.3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties Unit Value

Kerosine

150-250

19.8

Gas Oil Residue

250-350 >350

13.2 0.9

Year Of Crude Oil Sample: 1991

Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Smoke Point Freezing Point Gas Oil Cetane Index Residue Sulfur Content Pour Point

% Wt. % Wt. % Wt. mm Temp. C

42 38.5 19.5 17 -54 53

% Wt. Temp. F

0.13 95

CRUDE OIL HANDBOOK

PIW

H113

ATTAKA
Gravity: 42.3 Sulfur: 0.09

Indonesia
Loading Port: Santan

Production About 50,000 barrels a day from fields that lie mostly offshore eastern Kalimantan (Borneo) under a production-sharing contract with state Pertamina. Quality Light, low-sulfur crude oil with a high light-product yield and an unusually low pour point for an Indonesian grade. Despite the crude oils low wax content, it still produces a waxy residual oil with a high pour point. Sometimes sold as a blend with Badak crude oil. Producers Operator Unocal (50%) with Japanese Inpex (50%). Production split is 85-15 in favor of Pertamina after allowing for cost-recovery oil going to producers and excluding set volumes that producers must sell to the domestic market at discounted prices. Pricing And Marketing Exports have risen to about 40,000 b/d as less of the grade is being absorbed locally at the Cilacap refinery on Java. Japan alone accounts for about 15,000 b/d of Attaka purchases. Pricing is based on a complex retroactive formula known as the ICP, or Indonesian Contract Price. This formula has two components of equal weight. The first component is linked to the average prices for five spot crude oils Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the termcontract price. The second 50% component is the average of spot prices over the month in Platt's and Rim. These two components are averaged to arrive at the final ICP price. Sellers In addition to any volumes sold by equity producers, Pertamina sells the crude oil via four marketing affiliates. For sales to Japan, Indonesias largest market, Pacific Petroleum And Trading Company is used, a 50-50 joint ventures between Pertamina and Japanese buyers. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco) and sales to China go through Perta. Pacific Petroleum And Trading Company: East Tower 11F, Akasaka Twin Tower, 17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: (81-3) 5562-6504. Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul, Korea 10010. Tel: (822) 752-0592. Fax: (822) 752-0596. Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong. Tel: (852-5) 260-341. Fax: (852-5) 2519-8909. Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel: (62-21) 525-0120. Unocal International Supply & Trading Co.: Jakarta Representative Office, Mulia Tower, Suite 1511, Jl. Jendral Gatot Subroto Kav. 9-11, Jakarta 1293, Indonesia. Tel.: (6221) 517-274, Fax: (62-21) 517-276. Loading Port Santan. 00.07 S. 117.32 E. The Santan terminal, located on the east coast of Kalimantan about 80 miles north of Balikpapan, consists of a single-point mooring loading berth approximately 4.3 miles offshore in about 87 feet (28 meters) of water. Size restrictions are a minimum of 18,000 deadweight tons and a maximum of 125,000 dwt.

H114

PIW

CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. C <100 100-150 Yield % Vol. 15.3 17.6

ATTAKA ASSAY Crude Oil Value Specifications 42.3 Sulfur Content 7.74 Pour Point 1.45 Reid Vapor Press.

Unit % Weight Temp. F Lbs/Sq. In.

Value 0.09 -10 6.8

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Smoke Point Freezing Point Gas Oil Cetane Index Residue Sulfur Content Pour Point Unit Clear Octane % Wt. % Wt. % Wt. mm Temp. C Value 74.9 41 35 24.7 16 -54 52.6 % Wt. Temp. F 0.11 100

Kerosine

150-250

29.6

Gas Oil Residue

250-350 >350

25 12.5

Year Of Crude Oil Sample: 1991 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. $14.10 $14.95 $30.25 Feb. 14.10 14.95 32.25 March 14.10 14.95 32.25 April 14.10 17.00 32.25 May 14.10 18.00 34.25 June 14.10 21.00 34.25 July 14.10 23.50 34.25 Aug. 14.10 23.50 34.25 Sept. 14.10 23.50 34.25 Oct. 14.10 23.50 34.25 Nov. 14.10 23.50 34.25 Dec. 14.10 27.90 34.25 Month 1986 1987 1988 Jan. $28.65 $18.20 $18.79 Feb. 28.65 18.79 18.79 March 13.55 18.79 18.69 April 11.45 18.79 17.23 May 12.90 18.79 17.83 June 12.25 18.79 17.68 July 10.15 18.79 17.68 Aug. 11.90 18.79 16.03 Sept. 13.55 18.79 16.03 Oct. 13.95 18.79 14.43 Nov. 14.25 18.79 12.73 Dec. 15.40 18.79 13.13
Note: More recent prices can be found in Chapter I.

ATTAKA OFFICIAL TERM-CONTRACT PRICES, 1978-93 1981 $37.75 37.75 37.75 37.75 37.75 37.75 37.75 37.75 37.55 37.55 37.55 37.55 1989 $15.63 18.79 18.79 18.67 19.12 18.57 18.51 17.77 17.68 18.07 18.67 18.98 1982 $37.55 37.55 37.55 37.55 37.55 37.55 37.55 37.55 37.55 37.55 36.25 36.25 1990 $20.15 20.19 19.66 18.31 17.13 16.36 15.57 19.53 28.76 35.98 34.23 29.70 1983 $36.25 30.95 30.95 30.95 30.95 30.95 30.95 30.95 30.95 30.95 30.95 30.95 1991 $26.18 22.59 18.62 18.31 18.95 19.27 19.60 20.10 20.64 21.69 22.35 21.69 1984 $30.95 30.95 30.95 30.95 30.95 30.95 30.95 30.95 30.95 30.95 30.95 30.95 1992 $19.17 19.37 18.86 18.96 19.73 21.13 20.34 21.95 21.41 21.48 21.13 20.23 1985 $30.95 28.65 28.65 28.65 28.65 28.65 28.65 28.65 28.65 28.65 28.65 28.65 1993 $19.22 18.73 19.58 19.96 19.67 19.24 18.09 18.09 17.46 17.54 16.49 14.98

CRUDE OIL HANDBOOK

PIW

H115

BELIDA
Gravity: 40.0 Sulfur: 0.01

Indonesia
Loading Port: Belida

Production The first major light, sweet crude oil find in Indonesia in more than a decade began production at the end of 1992 from an offshore field in the South China Sea that lies south of Natuna Island. Output was about 115,000 barrels a day in 1995, up from 75,000 b/d in 1992. Quality Asian-type light, low-sulfur crude oil with high wax content. Producers Operator Conoco (40%) with Texaco (25%), Chevron (17.5%), and Japans Inpex (17.5%). Production split 85-15 in favor of Pertamina after allowing for cost-recovery oil going to producers and excluding set volumes that producers must sell to the domestic market. Pricing And Marketing About 65,000-70,000 b/d is exported to a wide variety of customers with cargoes going to Australia, Singapore, the US West Coast, and Japan. Pricing is based on a complex retroactive formula known as the ICP or Indonesian Contract Price. This formula has two components of equal weight. The first component is linked to the average prices for five spot crude oils Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of spot prices over the month in Platt's and Rim. These two components are averaged to reach the final ICP price. Sellers In addition to any volumes sold by equity producers, Pertamina sells the crude oil via four marketing affiliates. For sales to Japan, Indonesias largest market, Pacific Petroleum And Trading Company is used, a 50-50 joint venture between Pertamina and Japanese buyers. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco) and sales to China go through Perta. Pacific Petroleum And Trading Company: East Tower 11F, Akasaka Twin Tower, 17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: (81-3) 5562-6504. Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul, Korea 10010. Tel: (822)752-0592. Fax: (822) 752-0596. Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong. Tel: 5-260-341. Fax: 5-2519-8909. Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel: (62-21) 525-0120. Conoco International (Singapore): 80 Marine Parade Road 17-01A, Parkway Parade, Singapore 1544. Tel.: (65) 348-0771, Fax: (65) 345-0792. Loading Port Belida. Offshore loading facility at the production platform in the South China Sea. No practical restrictions on vessel size.

H116

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CRUDE OIL HANDBOOK

Assay not available.

BELIDA ASSAY

CRUDE OIL HANDBOOK

PIW

H117

CINTA
Gravity: 32.8 Sulfur: 0.12 Other Names: Cinta Blend, Intan-Cinta

Indonesia
Loading Port: Cinta

Production Output of about 50,000-60,000 barrels a day from offshore fields near southeast Sumatra. The Cinta field is adjacent to the more recent Widuri and Intan discoveries. Intan was initially commingled with Cinta due to its similar quality, but it is now exported with Widuri. Quality A typical medium-gravity Asian crude oil with low-sulfur but high-wax content, similar in quality to Indonesian benchmark Minas. Well-suited for cracking. Producers Maxus is the operator (55.68%), with small minority stakes held by Japans Inpex (13.07%), Repsol (9.87%), Itochu (7.68%), Deminex (5%), Warrior Oil (3.77%), Oryx (3.71%), and TCR (1.23%). Production split is 85-15 in favor of Pertamina after allowing for cost-recovery oil going to producers and excluding set volumes that producers must sell to the domestic market at discounted prices. Pricing And Marketing The crude oil has been sold mainly to Japan, which takes about 90% of total exports of about 45,000 b/d. Japan uses the crude oil mainly for direct burning in power plants. Pricing is based on a complex retroactive formula known as the ICP, or Indonesian Contract Price. This formula has two components of equal weight. The first is linked to the average prices for five spot crude oils Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of spot prices over the month in Platt's and Rim. These two are averaged to reach the final ICP price. Sellers In addition to any volumes sold by equity producers, Pertamina sells the crude oil via four marketing affiliates. For sales to Japan, Indonesias largest market, Pacific Petroleum And Trading Company, a 50-50 joint venture between Pertamina and Japanese buyers, is used. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), and sales to China go through Perta. Pacific Petroleum And Trading Company: East Tower 11F, Akasaka Twin Tower, 17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: -6504. Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul, Korea 10010. Tel: (822)752-0592. Fax: (822) 752-0596. Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong. Tel: (852-5) 260-341. Fax: (852-5) 2519-8909. Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel: (62-21) 525-0120. Maxus Energy Trading Co.: 1 Scotts Road, #18-03 Shaw Centre, 0922 Singapore. Tel.: (65) 732-9266, Fax: (65) 733-3397. Loading Port Cinta. 05.27 S. 106.14 E. The offshore Cinta terminal, located about 40 miles north of the Java coast and east of the southern tip of Sumatra in the Java Sea, consists of two storage vessels and two export single-buoy moorings. The system is designed to accommodate tankers of up to 175,000 deadweight tons, but due to limited storage, ships of that size can only take partial cargoes without waiting for storage to fill up again.

H118

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. C <100 100-180 Yield % Vol. 4.7 8

CINTA ASSAY Crude Oil Value Specifications 32.8 Sulfur Content 7.32 Pour Point 17.86 Wax Content

Unit % Weight Temp. F % Weight

Value 0.12 100 19.56

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Smoke Point Freezing Point Gas Oil Cetane Index Residue Sulfur Content Pour Point Unit Clear Octane % Wt. % Wt. % Wt. mm Temp. F Value 72.5 78.3 15.5 8.2 28 -5 74 % Wt. Temp. F 0.19 125

Kerosine

180-250

9.4

Gas Oil Residue

250-375 >375

19.5 31

Year Of Crude Oil Sample: 1991 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. $13.15 $13.50 $27.00 Feb. 13.15 13.50 29.00 March 13.15 13.50 29.00 April 13.15 15.20 29.00 May 13.15 15.70 31.00 June 13.15 17.75 31.00 July 13.15 21.01 31.00 Aug. 13.15 21.01 31.00 Sept. 13.15 21.01 31.00 Oct. 13.15 21.01 31.00 Nov. 13.15 23.50 31.00 Dec. 13.15 25.40 31.00 Month 1986 1987 1988 Jan. $27.25 $16.08 $17.20 Feb. 27.25 17.10 17.20 March ... 17.10 17.10 April ... 17.10 15.64 May ... 17.10 16.14 June ... 17.10 16.09 July ... 17.10 16.09 Aug. 9.30 17.20 14.44 Sept. 11.60 17.20 14.44 Oct. 12.60 17.20 12.84 Nov. 13.20 17.20 11.74 Dec. 13.20 17.20 12.14
Note: More recent prices can be found in Chapter I.

CINTA OFFICIAL TERM-CONTRACT PRICES, 1978-93 1981 $34.50 34.50 34.50 34.50 34.50 34.50 34.50 34.50 34.00 34.00 34.00 34.00 1989 $14.64 17.20 17.20 17.99 18.41 17.82 17.68 16.87 16.71 17.03 17.50 17.69 1982 $34.00 34.00 34.00 34.00 34.00 34.00 34.00 34.00 34.00 34.00 33.30 33.30 1990 $18.85 18.90 18.39 17.04 15.85 15.10 14.35 18.74 27.59 34.85 33.16 28.61 1983 $33.30 28.25 28.25 28.25 28.25 28.25 28.25 28.25 28.25 28.25 28.25 28.25 1991 $25.10 21.44 17.38 17.04 17.68 17.96 18.21 18.65 19.11 20.08 20.64 19.91 1984 $28.25 28.25 28.25 28.25 28.25 28.25 28.25 28.25 28.25 28.25 28.25 28.25 1992 $17.88 17.42 16.87 16.97 17.68 18.97 20.12 19.64 19.05 19.13 18.87 18.11 1985 $28.25 27.25 27.25 27.25 27.25 27.25 27.25 27.25 27.25 27.25 27.25 27.25 1993 $17.29 16.91 17.82 18.23 18.03 17.75 16.78 16.92 16.35 16.47 15.40 13.84

CRUDE OIL HANDBOOK

PIW

H119

DURI
Gravity: 20.3 Sulfur: 0.19

Indonesia
Loading Port: Dumai

Production About 250,000-300,000 barrels a day is produced from fields in central Sumatra, following an extensive steam-flooding program. About 20% of the total, or 50,000-60,000 b/d, is used to generate the steam for injection into the reservoirs. Quality A typical heavy Asian crude oil with an extremely high wax content and a high yield of hard-to-handle low-sulfur waxy residual oil. Producers Caltex Pacific Indonesia, a 50-50 joint venture between Chevron and Texaco, is the operator, with no other partners. State Pertamina receives the majority share of output after allowing for cost-recovery oil going to the producer and excluding a set volume that Caltex must sell to the domestic market at a discounted price. Pertamina also sells some volumes back to Caltex for international marketing. Pricing And Marketing The crude oil is sold widely in Asia, mainly on a term-contract basis, with exports of about 130,000 b/d. Japan is the main importer, taking about 35,000 b/d, with over half of that volume for direct burning. South Korea and China are also buyers. Over 70,000 b/d is used as feedstock at the Indonesian refineries of Dumai and Balikpapan. Chevron sometimes takes volumes to Singapore and its West Coast refineries, but Texaco rarely uses the crude oil in its own system. Pricing is based on a complex retroactive formula known as the ICP, or Indonesian Contract Price. This formula has two components of equal weight. The first is linked to the average prices for five spot crude oils Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of spot prices over the month in Platt's and Rim. These two are averaged to reach the final ICP price. Sellers In addition to any volumes sold by equity producers, Pertamina sells the crude oil via four marketing affiliates. For sales to Japan, Indonesias largest market, Pacific Petroleum and Trading Company, a 50-50 joint venture between Pertamina and Japanese buyers, is used. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco) and sales to China go through Perta. Pacific Petroleum and Trading Company: East Tower 11F, Akasaka Twin Tower, 17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: (81-3) 5562-6504. Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul, Korea 10010. Tel: (822)752-0592. Fax: (822) 752-0596. Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong. Tel: (852-5) 260-341. Fax: (852-5) 2519-8909. Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel: (62-21) 525-0120. Caltex Trading Pte. Ltd.: Caltex House, 30 Raffles Place, 0104 Singapore. Tel.: (65) 533-3000. Loading Port Dumai. 01.41 N. 101.27 E. The Dumai terminal, located on the northeast coast of the island of Sumatra, 150 miles west of Singapore, has four crude oil-loading berths. Size restrictions are up to 150,000 deadweight tons and draft of 57 feet.

H120

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CRUDE OIL HANDBOOK

Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. C <100 100-200 200-300 300-350 >350 Yield % Vol. 0.6 3.4 10.6 22.4 79.1

DURI ASSAY Crude Oil Value Specifications 20.3 Sulfur Content 6.75 Pour Point 488.5 Reid Vapor Press. Wax Content

Unit % Weight Temp. F Lbs/Sq. In. % Weight

Value 0.19 60 1 13

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Int. Naphtha Kerosine Gas Oil Residue Properties Light Naphtha Octane RON Intermediate Naphtha Aromatics Kerosine Smoke Point Gas Oil Cetane Index Residue Sulfur Content Pour Point Unit Clear Octane % Wt. mm Value 74 11.7 13 41.1 % Wt. Temp. F 0.27 75

Year Of Crude Oil Sample: 1991 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. $13.55 $13.90 $27.50 Feb. 13.55 13.90 29.50 March 13.55 13.90 29.50 April 13.55 15.65 29.50 May 13.55 16.15 31.50 June 13.55 18.25 31.50 July 13.55 21.12 31.50 Aug. 13.55 21.12 31.50 Sept. 13.55 21.12 31.50 Oct. 13.55 21.12 31.50 Nov. 13.55 23.50 31.50 Dec. 13.55 25.50 31.50 Month 1986 1987 1988 Jan. $24.00 $14.28 $16.10 Feb. 24.00 15.60 16.10 March ... 15.60 16.00 April ... 15.60 14.54 May ... 15.60 15.14 June ... 15.60 14.99 July ... 15.60 14.99 Aug. 7.90 16.10 13.34 Sept. 9.90 16.10 13.34 Oct. 10.80 16.10 11.74 Nov. 11.40 16.10 10.64 Dec. 11.40 16.10 11.04
Note: More recent prices can be found in Chapter I.

DURI OFFICIAL TERM-CONTRACT PRICES, 1978-93 1981 $35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 1989 $13.54 16.10 16.10 16.57 16.99 16.39 16.25 15.41 14.81 15.10 15.72 15.94 1982 $35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 33.10 33.10 1990 $17.09 17.86 17.26 15.75 14.37 13.48 12.59 16.77 25.41 32.66 30.90 26.40 1983 $33.10 27.85 27.85 27.85 27.85 27.85 27.85 27.85 27.85 27.85 27.85 27.85 1991 $22.79 19.14 15.14 14.61 15.06 15.29 15.38 15.57 15.71 16.26 16.97 16.58 1984 $27.85 27.85 27.85 25.95 25.95 25.95 25.95 25.95 25.95 25.95 25.95 25.95 1992 $14.90 14.20 13.72 13.81 14.51 15.78 17.02 16.78 16.36 16.40 16.38 15.94 1985 $25.95 25.95 25.95 25.95 25.95 25.95 25.95 24.00 24.00 24.00 24.00 24.00 1993 $15.32 14.96 15.92 16.61 16.70 16.07 14.68 14.34 13.70 13.92 12.87 11.18

CRUDE OIL HANDBOOK

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H121

HANDIL
Gravity: 32.2 Other Names: Senipah Sulfur: 0.1

Indonesia
Loading Port: Senipah

Production About 40,000 barrels a day from offshore fields on the east coast of Kalimantan, down from a peak of over 140,000 b/d in 1986. Quality Typical medium-gravity, low-sulfur Asian crude oil similar to Indonesian benchmark Minas. High wax content produces hard-to-handle, high-pour-point fuel oil. Good for gasoline production through reforming, also has a wide kerosine cut. Producers Operator Total (50%) with Japans Inpex (50%). The production split is 85-15 in favor of state Pertamina after allowing for cost-recovery oil going to producers and excluding set volumes that producers must sell to the domestic market at discounted prices. Pricing And Marketing With Pertamina absorbing a larger share of declining output internally at the nearby Balikpapan refinery, international spot sales are rare, and most of the overseas sales of about 25,000 b/d are committed on a term basis to Japan, where the crude oil is used both for refining and direct burning. Pricing is based on a complex retroactive formula known as the ICP, or Indonesian Contract Price. This formula has two components of equal weight. The first is linked to the average prices for five spot crude oils Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of spot prices for the crude oil over the month in Platt's and Rim. These two are averaged to arrive at the final ICP price. Sellers In addition to any volumes sold by equity producers, Pertamina sells the crude oil via four marketing affiliates. For sales to Japan, Indonesias largest market, Pacific Petroleum and Trading Company, a 50-50 joint venture between Pertamina and Japanese buyers, is used. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), and sales to China go through Perta. Pacific Petroleum and Trading Company: East Tower 11F, Akasaka Twin Tower, 17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: (81-3) 5562-6504. Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul, Korea 10010. Tel: (822) 752-0592. Fax: (822) 752-0596. Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong. Tel: (852-5) 260-341. Fax: (852-5) 2519-8909. Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel: (62-21) 525-0120. Total Petroleum (Southeast Asia) Pte. Ltd.: 331 North Bridge Road, #23-01 Odeon Tower, Singapore 0718. Tel.: (65) 336-1333, Fax: (65) 336-7100. Loading Port Senipah. 01.03 S. 117.13 E. The Senipah Sea Terminal, located about 26 miles (45 kilometers) northeast of Balikpapan on the east coast of Kalimantan, consists of two berths. The maximum size vessel is 125,000 deadweight tons. The terminal has storage for 631,000 barrels of Bekapai and 1.91-million barrels of Handil.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. C <100 100-150 Yield % Vol. 9.5 9.5

HANDIL ASSAY Crude Oil Value Specifications 32.2 Sulfur Content 7.29 Pour Point 4.6 Reid Vapor Press. Wax Content

Unit % Weight Temp. F Lbs/Sq. In. % Weight

Value 0.1 85 3.3 22

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Smoke Point Freezing Point Gas Oil Cetane Index Residue Sulfur Content Pour Point Unit Clear Octane % Wt. % Wt. % Wt. mm Temp. C Value 81.1 18 28.5 53 12 -38 50.5 % Wt. Temp. F 0.11 12

Kerosine

150-250

20.2

Gas Oil Residue

250-350 >350

26.6 34.2

Year Of Crude Oil Sample: 1991 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. $13.30 $13.95 $27.55 Feb. 13.30 13.95 29.55 March 13.30 13.95 29.55 April 13.30 15.70 29.55 May 13.30 16.30 31.55 June 13.30 18.30 31.55 July 13.30 21.16 31.55 Aug. 13.30 21.16 31.55 Sept. 13.30 21.16 31.55 Oct. 13.30 21.16 31.55 Nov. 13.30 23.50 31.55 Dec. 13.30 25.60 31.55 Month 1986 1987 1988 Jan. ... ... $17.61 Feb. ... $17.61 17.61 March ... 17.61 17.51 April ... 17.61 16.05 May ... 17.61 16.65 June ... 17.61 16.50 July ... 17.61 16.50 Aug. ... 17.61 14.85 Sept. ... 17.61 14.85 Oct. ... 17.61 13.25 Nov. ... 17.61 12.15 Dec. ... 17.61 12.65
Note: More recent prices can be found in Chapter I.

HANDIL OFFICIAL TERM-CONTRACT PRICES, 1978-93 1981 $35.30 35.30 35.30 35.30 35.30 35.30 35.30 35.30 34.00 34.00 34.00 34.00 1989 $15.15 17.61 17.61 18.73 18.65 18.09 17.97 17.17 17.05 17.40 17.90 18.09 1982 $34.00 34.00 34.00 34.00 34.00 34.00 34.00 34.00 34.00 34.00 34.80 34.80 1990 $19.25 19.29 18.75 17.41 16.24 15.49 14.74 19.10 27.95 35.17 33.43 28.86 1983 $34.80 29.50 29.50 29.50 29.50 29.50 29.50 29.50 29.50 29.50 29.50 29.50 1991 $25.38 21.77 17.76 17.42 18.05 18.34 18.61 19.06 19.54 20.53 21.11 20.43 1984 $29.50 29.50 29.50 29.50 29.50 29.50 29.50 29.50 29.50 29.50 29.50 29.50 1992 $18.39 17.92 17.39 17.51 18.25 19.56 20.72 20.25 19.68 19.76 19.49 18.72 1985 $29.50 28.00 28.00 28.00 28.00 28.00 28.00 27.80 27.80 27.80 27.80 27.80 1993 $17.88 17.48 18.38 18.76 18.54 18.21 17.19 17.31 16.74 16.87 15.82 14.29

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H123

LALANG
Gravity: 39.2 Sulfur: 0.11 Other Names: Lalang Export Blend

Indonesia
Loading Port: Lalang Marine Terminal

Production Output of about 25,000 barrels a day from a cluster of small offshore fields off the east coast of central Sumatra under a standard Indonesian production-sharing contract. The main fields are Lalang, Melibur, Kurau, and Mengkapan. Output peaked at about 60,000 b/d in 1989-90. Quality A typical light, low-sulfur Asian grade with high wax content. Good yields of gasoline and middle distillates are possible. Producers Lasmo is the operator with a 23.4% share, along with partners Arco (32.58%), Oryx (21.46%), Nippon Oil (17.55%), and Kondur Petroleum (5%). Production split is 85-15 in favor of Pertamina after allowing for cost-recovery oil going to producers and excluding set volumes that producers must sell to the domestic market at discounted prices. Pricing And Marketing Exports have slipped to about 15,000 b/d, with about half going to Japan and about half to nearby Singapore. The remainder of the grade is absorbed locally. Pricing is based on a complex retroactive formula known as the ICP, or Indonesian Contract Price. This formula has two components of equal weight. The first is linked to the average prices for five spot grades Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the termcontract price. The second 50% component is the average of spot prices over the month in Platt's and Rim. These two are averaged to reach the final ICP price. Sellers In addition to any volumes sold by equity producers, Pertamina sells the grade via four marketing affiliates. For sales to Japan, Indonesias largest market, Pacific Petroleum and Trading Company, a 50-50 joint venture between Pertamina and Japanese buyers, is used. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), and sales to China go through Perta. Pacific Petroleum and Trading Company: East Tower 11F, Akasaka Twin Tower, 17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: (81-3) 5562-6504. Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul, Korea 10010. Tel: (822)752-0592. Fax: (822) 752-0596. Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong. Tel: (852-5) 260-341. Fax: (852-5) 2519-8909. Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel: (62-21) 525-0120. Loading Port Lalang Marine Terminal. 01.22 S. 102.15.03 E. The terminal is located off the east coast of central Sumatra south of Dumai and about 80 kilometers west of Singapore. It can handle ships up to 140,000 deadweight tons with a depth of 22.7 meters. Storage capacity is 1.012-million barrels.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. C <100 100-150 Yield % Vol. 1.7 8.6

LALANG ASSAY Crude Oil Value Specifications 39.2 Sulfur Content 7.6 Pour Point 7.5 Reid Vapor Press. Wax Content

Unit % Weight Temp. F Lbs/Sq. In. % Weight

Value 0.11 90 2.5 27.4

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Smoke Point Freezing Point Gas Oil Cetane Index Residue Sulfur Content Pour Point Unit Clear Octane % Wt. % Wt. % Wt. mm Temp. C Value 75.2 73.5 23.4 3.1 28 -40 72 % Wt. Temp. F 0.17 120

Kerosine

150-250

19.5

Gas Oil Residue

250-350 >350

25 40

Year Of Crude Oil Sample: 1991

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H125

MINAS

Indonesia

Gravity: 34.1 Sulfur: 0.09 Loading Port: Dumai Other Names: Sumatran Light, Sumatran Light Export Blend, SLC Production About 385,000-400,000 barrels a day is produced from the Minas field and others onshore in central Sumatra. Minas is by far the largest crude oil stream in Indonesia. Quality Indonesias benchmark grade is typical of medium-gravity Asian crude oils, which are low in sulfur but high in wax content and pour point. Producers Caltex Pacific Indonesia, a 50-50 joint venture between Chevron and Texaco, is the operator, with no other partners. State Pertamina receives a 90% share of the output after allowing for cost-recovery oil going to the producer and excluding a set volume that Caltex must sell to the domestic market at a discounted price. Pertaminas share was increased in 1992, when the contract with Caltex was extended to 2023. Pricing And Marketing About 235,000 b/d of Minas is exported, and Japan is the primary market, taking about 195,000 b/d both from Pertamina and Caltex sources in 1995. The grade is often used as boiler fuel by Japanese utilities. Caltex, Chevron, and Texaco also take some of the grade for their own refining systems. Pertamina has increased its reliance on the grade for local needs, which has reduced export volumes from over 300,000 b/d in the late 1980s. Minas is one of the most actively traded spot crude oils in the region with about 6-8 wet barrel deals a month. Pricing is based on a complex retroactive formula known as the ICP or Indonesian Contract Price. This formula has two components of equal weight. The first component is linked to the average prices for five spot crude oils Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the term-contract price. The second 50% component is the average of Ardjuna spot prices over the month in Platt's and Rim. These two are averaged to reach the final ICP price. Sellers In addition to any volumes sold by equity producers, Pertamina sells the grade via four marketing affiliates. For sales to Japan, Indonesias largest market, Pacific Petroleum and Trading Company, a 50-50 joint venture between Pertamina and Japanese buyers, is used. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), and sales to China go through Perta. Pacific Petroleum And Trading Company: East Tower 11F, Akasaka Twin Tower, 17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: -6504. Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul, Korea 10010. Tel: (822)752-0592. Fax: (822) 752-0596. Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong. Tel: (852-5) 260-341. Fax: (852-5) 2519-8909. Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel: (62-21) 525-0120. Caltex Trading Pte. Ltd.: Caltex House, 30 Raffles Place, 0104 Singapore. Tel.: (65) 533-3000. Loading Port Dumai. 01.41 N. 101.27 E. The Dumai terminal, located on the northeast coast of the island of Sumatra, 150 miles west of Singapore, has three crude oil-loading berths. Size restrictions are up to 150,000 deadweight tons and draft of 57 feet.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. C <100 100-150 Yield % Vol. 3.6 5.3

MINAS ASSAY Crude Oil Value Specifications 34.1 Sulfur Content 7.38 Pour Point 13.2 Reid Vapor Press. Wax Content

Unit % Weight Temp. F Lbs/Sq. In. % Weight

Value 0.09 95 1.3 34.2

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Smoke Point Freezing Point Gas Oil Cetane Index Residue Sulfur Content Pour Point Unit Clear Octane % Wt. % Wt. % Wt. mm Temp. C Value 59.2 60 37 3 26 -4 61.8 % Wt. Temp. F 0.11 120

Kerosine

150-250

12.8

Gas Oil Residue

250-350 >350

18.8 59.5

Year Of Crude Oil Sample: 1991 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. $13.55 $13.90 $27.50 Feb. 13.55 13.90 29.50 March 13.55 13.90 29.50 April 13.55 15.65 29.50 May 13.55 16.15 31.50 June 13.55 18.25 31.50 July 13.55 21.12 31.50 Aug. 13.55 21.12 31.50 Sept. 13.55 21.12 31.50 Oct. 13.55 21.12 31.50 Nov. 13.55 23.50 31.50 Dec. 13.55 25.50 31.50 Month 1986 1987 1988 Jan. $28.33 $16.28 $17.56 Feb. 28.33 17.56 17.56 March 12.90 17.56 17.46 April 10.45 17.56 16.00 May 11.35 17.56 16.60 June 11.15 17.56 16.45 July 9.50 17.56 16.45 Aug. 10.10 17.56 14.80 Sept. 12.00 17.56 14.80 Oct. 13.00 17.56 13.20 Nov. 13.50 17.56 12.10 Dec. 13.50 17.56 12.50
Note: More recent prices can be found in Chapter I.

MINAS OFFICIAL TERM-CONTRACT PRICES, 1978-93 1981 $35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 1989 $15.00 17.56 17.56 18.21 18.64 18.07 17.94 17.15 17.02 17.36 17.86 18.07 1982 $35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 35.00 34.53 34.53 1990 $19.24 19.32 18.83 17.49 16.30 15.55 14.81 19.19 28.03 35.29 33.57 29.01 1983 $34.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 1991 $25.48 21.79 17.72 17.37 18.01 18.30 18.56 19.00 19.49 20.45 21.04 20.34 1984 $29.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 29.53 1992 $18.32 17.88 17.35 17.47 18.20 19.51 20.67 20.22 19.64 19.73 19.47 18.70 1985 $29.53 28.53 28.53 28.53 28.53 28.53 28.53 28.33 28.33 28.33 28.33 28.33 1993 $17.89 17.51 18.42 18.84 18.67 18.41 17.44 17.56 17.01 17.13 16.07 14.50

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H127

WIDURI
Gravity: 33.2 Sulfur: 0.07 Other Names: Widuri Blend

Indonesia
Loading Port: Widuri

Production Output of about 75,000 barrels a day in 1995 included volumes from both the Widuri and Intan fields, which lie offshore between the northwest coast of Java and the southeast tip of Sumatra. This is down from peak levels of about 100,000 b/d. Quality A typical medium-gravity Indonesian crude oil somewhat inferior to Minas. It is especially good for cracking, but Widuri initially faced problems establishing market outlets due to its high wax content. Producers Maxus is the operator (55.68%), with small minority stakes held by Inpex (13.07%), Repsol (9.87%), Itochu (7.68%), Deminex (5%), Warrior Oil (3.77%), Oryx (3.71%), and TCR (1.23%). Production split is 85-15 in favor of Pertamina after allowing for cost-recovery oil going to producers and excluding set volumes that producers must sell to the domestic market at discounted prices. Pricing And Marketing Virtually all production is exported, making Widuri one of Indonesias larger export streams after Minas, Duri, Arun, and Belida. Japanese buyers take about half of the exports. China is also a buyer along with Australia. Pricing is based on a complex retroactive formula known as the ICP, or Indonesian Contract Price. This formula has two components of equal weight. The first is linked to the average prices for five spot crude oils Indonesian Minas, Malaysian Tapis, Australian Gippsland, Dubai, and Oman over the calendar month as reported by the Asian Petroleum Price Index. The average differential between the basket and the spot price of Ardjuna over the last 52 weeks is then applied to arrive at a 50% weighting for the termcontract price. The second 50% component is the average of Ardjuna spot prices over the month in Platt's and Rim. These two are averaged to reach the final ICP price. Sellers In addition to any volumes sold by equity producers, Pertamina sells the grade via four marketing affiliates. For sales to Japan, Indonesias largest market, Pacific Petroleum and Trading Company, a 50-50 joint venture between Pertamina and Japanese buyers, is used. Sales to Korea are handled by Korea-Indonesia Petroleum Company (Kipco), and sales to China go through Perta. Pacific Petroleum and Trading Company: East Tower 11F, Akasaka Twin Tower, 17-22 Akasaka 2, Chome Minatoku, Tokyo, Japan. Tel.: (81-3) 5562-6501. Fax: -6504. Kipco: Donghwa Building, 10th Floor, 58-7, Seosomun-dong, Chung-gu, Seoul, Korea 10010. Tel: (822)752-0592. Fax: (822) 752-0596. Perta Oil Marketing: 1107 Connaught Centre, Connaught Road Central, Hong Kong. Tel: (852-5) 260-341. Fax: (852-5) 2519-8909. Permindo: Wisma Bakrie Bldg., Jl. H.R. Rasuna Said Kav B1, Kuningan, Jakarta. Tel: (62-21) 525-0120. Maxus Energy Trading Co.: 1 Scotts Road, #18-03 Shaw Centre, 0922 Singapore. Tel.: (65) 732-9266, Fax: (65) 733-3397. Loading Port Widuri. 4.40.16 S. 106.39.50 E. The offshore terminal has two single-buoy moorings that can each take ships up to 175,000 deadweight tons. They are served by a 1.9-millionbarrel storage vessel.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 60 C Cut Points Temp. C/F <65 <149

WIDURI ASSAY Crude Oil Value Specifications 33.2 Sulfur Content 7.338 Pour Point 8.98 Reid Vapor Press. Wax Content

Unit % Weight Temp. C/F Lbs/Sq. In. % Weight

Value 0.07 45/113 <0.5 39.3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Yield % Vol. % Wt. 0.51 0.4 Properties Light Naphtha Octane RON Paraffins Naphthenes Aromatics Intermediate Naphtha Octane RON Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Kerosine Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Heavy Gas Oil Cloud Point Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Clear Octane % Wt. % Wt. % Wt. Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C Value 61.2 82.8 17 0.2 53.8 57.6 41.7 0.7 59 38.7 2.3 -39.5 0.04 -7 57.5 13 0.14 51 29.37 <0.5 4.12 3 10

Int. Naphtha

65-100 149-212

0.88

0.74

Heavy Naphtha

100-150 212-302

3.21

2.77

Kerosine Light Gas Oil

150-250 302-482 250-300 482-572

8.83 7.65

8.06 7.29

Heavy Gas Oil Residue

300-370 572-698 >370 >698

12.51 68.33

12.06 68.59

Temp. C % Wt. Temp. C Cen at 80 C % Wt. % Wt. Parts/mill. Parts/mill.

Year Of Crude Oil Sample: 1989

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H129

FOROOZAN BLEND
Gravity: 30.7 Sulfur: 2.5 Other Names: Forouzan, Fereidoon, Darius, Cyrus

Iran
Loading Port: Kharg Island

Production Combined flows of about 275,000 barrels a day from the offshore Foroozan, Dorood, Abuzar, and Soroosh fields, which were severely damaged in the war with Iraq but have now been restored with further increases in capacity to over 500,000 b/d by 2000. Quality Similar to Iranian Heavy, but somewhat higher in sulfur. The assay below reflects the combined fields at their restored volume, but quality may change with rising output. Producers State National Iranian Oil Co. is the exclusive producer. Pricing And Marketing Cargoes are mainly exported on an f.o.b. basis from the nearby Kharg Island terminal to customers in the Asia-Pacific region, mainly on a term-contract basis. Japan imports over 50,000 b/d. Prices are set according to a formula similar to Iran Heavy. Spot sales are rare. Sellers NIOC is the exclusive seller. The firm has offices around the world, including a trading subsidiary in London called Nafta-Iran. NIOC Iran: Crude Oil Marketing, NIOC Central Building, Taleghani Ave., Tehran, Iran. Phone: (98-21) 646-0351. Fax: (98-21) 646-0302. NIOC and Nafta-Iran Intertrade: NIOC House, 4 Victoria St., London SW1H 0NE, UK. Tel.: (44-171) 227-2138, Fax: (44-171) 976-8315. NIOC Toronto: 4950 Young St., Suite 808, North York, Toronto, Ontario, Canada M2N 6K1. Tel.: (416) 459-9426, Fax: (416) 590-9836. NIOC Singapore: 70 Shenton Way, 17-03 Marina House, 0207 Singapore. Tel.: (65) 227-3722, Fax: (65) 227-3622. Loading Port Kharg Island. 29.14 N. 50.19 E. Located at the northeast end of the Mideast Gulf, Kharg Island has a main terminal and the four-berth Sea Island on the west side of Kharg. The terminals T-jetty has a total of 10 crude oil-loading berths. Only about half the berths are in use, with the others requiring further reconstruction. Damage to onshore storage during the war with Iraq requires the use of storage tankers to maintain smooth loading operations.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic) Hydrogen Sulfide Con. Carbon Residue Wax Content

Unit API /Metric Ton Centistokes at 40 C ppm % Weight % Weight

Year Of Crude Oil Sample: 1993

FOROOZAN BLEND ASSAY Crude Oil Value Specifications 30.7 Sulfur Content 7.2 Pour Point 8.61 Reid Vapor Press. Nickel 6 Vanadium 6.16 Iron 7.18 Lead Sodium

Unit % Weight Temp. C psi ppm ppm ppm ppm ppm

Value 2.5 -35 5.7 13 48 10 2.7 14

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H131

IRAN HEAVY
Gravity: 30.2 Sulfur: 1.77 Other Names: Gachsaran

Iran
Loading Port: Kharg Island

Production In 1995-96, Iran Heavy production was about 1.5-million barrels a day, with exports of around 1.1-million b/d. Iran Heavy flows are slightly larger than those of Iran Light, making it the countrys largest crude oil stream. Among the biggest fields in the Iran Heavy stream are Gachsaran and Bibi Hakimeh, which are heavily dependent on gas injection programs to maintain output levels. Quality A typical medium-heavy, high-sulfur Mideast crude oil similar in quality to Arab Medium or Kuwait. Iran Heavy has become slightly heavier and higher in sulfur over the last 10 years. Producers State National Iranian Oil Co. is the exclusive producer. Pricing And Marketing Cargoes are sold from the Kharg Island terminal into Northwest Europe, the Mediterranean, and the Far East. Volumes are usually acquired on a term or spot basis from NIOC. Traders sometimes resell the grade into the Mediterranean spot market, but this practice has decreased with NIOCs greater focus on sales to refiners, which was reinforced by the US ban on purchases by American companies in 1995. The traditional distinctions between spot and term sales are particularly blurred in the case of Irans main export grades. The country maintains a stable of some 40 regular buyers, although some buy only monthly spot cargoes, while others hold contracts of up to a year in length. Prices to Europe are set on a cargo-by-cargo basis according to a formula that is set on a variable differential to dated Brent quotes. Supplies can be purchased both on an f.o.b. basis from Kharg Island and on a delivered basis from Rotterdam storage. To the Far East, Iran Heavy is sold at a variable differential to spot Dubai with a special adjustment in the formula to compensate for swings in the Oman-Dubai price spread. Sellers NIOC is the exclusive seller of f.o.b. cargoes from Kharg Island, and has offices around the world. NIOC Iran: Crude Oil Marketing, NIOC Central Building, Taleghani Ave., Tehran, Iran. Phone: (98-21) 646-0351. Fax: (98-21) 646-0302. NIOC and Nafta-Iran Intertrade: NIOC House, 4 Victoria St., London SW1H 0NE, UK. Tel.: (44-171) 227-2138, Fax: (44-171) 976-8315. NIOC Toronto: 4950 Young St., Suite 808, North York, Toronto, Ontario, Canada M2N 6K1. Tel.: (416) 459-9426, Fax: (416) 590-9836. NIOC Singapore: 70 Shenton Way, 17-03 Marina House, 0207 Singapore. Tel.: (65) 227-3722, Fax: (65) 227-3622. Loading Ports Kharg Island. 29.14 N. 50.19 E. Located at the northeast end of the Mideast Gulf, Kharg Island has a main terminal and the four-berth Sea Island on the west side of Kharg. The terminals T-jetty has a total of 10 crude oil-loading berths. Only about half the berths are in use, with the others requiring further reconstruction. Damage to onshore storage during the war with Iraq requires the use of storage tankers to maintain smooth loading opera-

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic) Hydrogen Sulfide Con. Carbon Residue Wax Content

Unit API /Metric Ton Centistokes at 40 C ppm % Weight % Weight

Year Of Crude Oil Sample: 1993 At Port Of Loading In Dollars Per Barrel Month 1988 1989 1990 Jan. $15.20 $13.90 $17.29 Feb. 14.84 14.05 16.53 March 13.18 15.40 15.61 April 14.67 16.75 13.84 May 14.63 15.50 14.13 June 13.53 15.25 12.78 July 12.78 15.35 14.23 Aug. 12.88 14.85 23.91 Sept. 11.28 15.45 30.86 Oct. 9.65 16.00 31.73 Nov. 9.95 16.00 28.19 Dec. 11.85 16.95 23.46

IRAN HEAVY ASSAY Crude Oil Value Specifications 30.2 Sulfur Content 7.2 Pour Point 9.26 Reid Vapor Press. Nickel 59 Vanadium 6.17 Iron 10.7 Lead Sodium

Unit % Weight Temp. C psi ppm ppm ppm ppm ppm

Value 1.77 -19 6.7 28 100 9.1 2.5 7.9

IRAN HEAVY TERM-CONTRACT PRICES, 1988-93 1991 $18.16 13.32 13.82 14.72 14.48 14.26 15.67 16.73 17.77 16.94 15.81 14.73 1992 $14.49 14.34 15.14 16.14 17.42 17.70 17.26 17.00 17.43 16.93 15.89 15.10 1993 $14.26 14.98 15.21 15.19 14.91 14.26 13.31 13.47 12.99 13.63 12.56 11.22

Note: 1/88-3/91 prices are for f.o.b. sales to Far East destinations. Prices for 4/91-12/93 represent a weighted average of f.o.b. prices for sales to the Far East and Europe.

IRAN HEAVY SPOT PRICES, 1987-93 At Port Of Loading In Dollars Per Barrel Month 1987 1988 1989 Jan. $17.15 $15.30 $13.90 Feb. 16.70 14.95 14.05 March 16.80 13.00 15.55 April 16.70 14.70 17.40 May 17.05 14.50 16.25 June 17.10 13.40 15.55 July 17.40 13.10 15.65 Aug. 17.10 12.75 15.10 Sept. 17.05 11.35 15.90 Oct. 17.05 9.85 16.00 Nov. 15.80 10.10 15.95 Dec. 15.30 12.10 16.90
Note: More recent prices can be found in Chapter I.

1990 $17.35 16.60 15.65 13.85 13.60 12.05 14.10 23.45 29.40 31.30 27.70 22.95

1991 $19.35 14.35 14.80 15.15 16.00 15.25 15.75 16.10 17.35 18.45 18.10 14.80

1992 $14.75 15.35 15.35 16.15 17.10 18.50 17.95 17.45 18.05 18.25 17.25 15.80

1993 $14.70 15.60 15.85 15.85 15.70 14.70 14.00 14.00 13.70 14.40 13.05 11.95

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H133

IRAN LIGHT
Gravity: 33.1 Other Names: Agha Jari Sulfur: 1.5

Iran
Loading Port: Kharg Island

Production In 1995-96, output was about 1.3-million barrels a day, with exports of about 1-million b/d from several onshore fields including Agha Jari, Marun, Karanj, and Pazanan. The Agha Jari field supplies about 270,000 b/d. Both the Karanj and Parsi fields have benefited from extensive investment in gas injection in the early 1990s to maintain flow rates. Quality Similar to Arabian Light, Dubai, and other light Mideast grades, it has become a bit heavier and higher in sulfur in recent years as indicated by the earlier assay from 1982. Producers State National Iranian Oil Co. is the exclusive producer. Pricing And Marketing Cargoes are sold from the Kharg Island terminal into Northwest Europe, the Mediterranean, and the Far East. Volumes are usually acquired on a term or spot basis from NIOC. Traders sometimes resell the grade into the Mediterranean spot market, but this practice has decreased with NIOCs greater focus on sales to refiners, which was reinforced by the US ban on purchases by US companies in 1995. The traditional distinctions between spot and term sales are particularly blurred in the case of Irans main export grades. The country maintains a stable of some 40 regular buyers, although some buy only monthly spot cargoes, while others hold contracts of up to a year in length. Prices to Europe are set on a cargo-by-cargo basis according to a formula that is set on a variable differential to dated Brent quotes. Supplies can be purchased both on an f.o.b. basis from Kharg Island and on a delivered basis from Rotterdam storage. To the Far East, Iran Heavy is sold at a variable differential to spot Dubai with a special adjustment in the formula to compensate for swings in the Oman-Dubai price spread. Sellers NIOC is the exclusive seller of f.o.b. cargoes from Kharg Island. Since Iran Light regularly appears in the spot market, traders compete with NIOC in Europe and the Far East for customers. NIOC has offices around the world. NIOC Iran: Crude Oil Marketing, NIOC Central Building, Taleghani Ave., Tehran, Iran. Phone: (98-21) 646-0351. Fax: 98-21) 646-0302. NIOC and Nafta-Iran Intertrade: NIOC House, 4 Victoria St., London SW1H 0NE, UK. Tel.: (44-171) 227-2138, Fax: (44-171) 976-8315. NIOC Toronto: 4950 Young St., Suite 808, North York, Toronto, Ontario, Canada M2N 6K1. Tel.: (416) 459-9426, Fax: (416) 590-9836. NIOC Singapore: 70 Shenton Way, 17-03 Marina House, 0207 Singapore. Tel.: (65) 227-3722, Fax: (65) 227-3622. Loading Port Kharg Island. 29.14 N. 50.19 E. Located at the northeast end of the Mideast Gulf, Kharg Island has a main terminal and the four-berth Sea Island on the west side of Kharg. The terminals T-jetty has a total of 10 crude oil-loading berths. Only about half the berths are in use, with the others requiring further reconstruction. Damage to onshore storage during the war with Iraq requires the use of storage tankers to maintain smooth loading operations.

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Crude Oil Specifications Unit Gravity (60 F) API Barrels /Metric Ton Viscosity Centistokes (Kinematic) at 40 C Hydrogen Sulfide ppm Con. Carbon Residue % Weight Wax Content % Weight Year Of Crude Oil Sample: 1993 Prices At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. $12.64 $13.45 $30.37 Feb. 12.64 13.45 32.87 March 12.64 14.27 32.87 April 12.64 16.57 35.37 May 12.64 17.09 29.93 June 12.64 18.47 29.93 July 12.64 22.00 31.93 Aug. 12.64 22.21 31.93 Sept. 12.64 22.21 31.93 Oct. 12.64 23.71 31.93 Nov 12.64 25.93 31.93 Dec. 12.64 28.71 31.93 Month 1986 1987 1988 Jan. $26.65 $17.90 $14.27 Feb. 14.80 17.50 14.45 March 12.20 17.50 14.35 April 11.10 17.50 14.49 May 11.95 17.50 14.03 June 10.95 17.50 13.38 July 8.40 17.50 12.51 Aug. 12.70 17.50 11.66 Sept. 13.70 17.50 10.92 Oct. 13.85 17.50 11.02 Nov. 14.30 17.50 12.57 Dec. 15.55 17.50 14.25

IRAN LIGHT ASSAY Crude Oil Value Specifications 33.1 Sulfur Content 7.33 Pour Point 6.33 Reid Vapor Press. Nickel 50 Vanadium 4.89 Iron 6.85 Lead Sodium

Unit % Weight Temp. C psi ppm ppm ppm ppm ppm

Value 1.5 -19 8.1 16 58 12 2.3 6.9

IRAN LIGHT AVERAGE TERM-CONTRACT PRICES, 1978-93 1981 $37.00 37.00 37.00 37.00 37.00 37.00 36.00 36.00 36.00 36.00 34.60 34.60 1989 $15.35 16.84 17.36 17.15 15.76 15.38 15.66 16.23 16.67 16.98 18.03 18.17 1982 $34.20 30.20 30.20 30.20 30.20 30.20 31.20 31.20 31.20 31.20 31.20 31.20 1990 $17.01 15.64 14.18 13.05 13.44 17.47 24.32 32.97 31.60 29.65 26.08 21.39 1983 $31.20 31.20 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 1991 $17.85 15.59 16.81 16.09 15.93 16.28 17.33 18.37 19.35 17.96 16.70 16.18 1984 $28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 28.00 1992 $15.85 15.52 16.54 17.45 18.83 18.78 18.33 18.26 18.64 17.84 16.77 15.62 1985 $29.11 28.05 28.05 28.05 28.05 28.05 28.05 28.05 28.05 26.20 27.10 26.40 1993 $15.37 16.24 16.33 16.21 15.94 15.25 14.39 14.62 14.05 14.64 13.53 12.30

Note: Official government selling prices through 1/86, netback formulas from 2/86-2/87, official government selling price from 2/87-12/87, average spot crude-linked formula price for 1988-93. Note: More recent prices can be found in Chapter I.

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H135

LAVAN BLEND
Gravity: 34.3 Sulfur: 1.87 Other Names: Sassan, Salman, Rostam

Iran
Loading Port: Lavan Island

Production About 140,000 barrels a day comes from three offshore fields in the southeastern part of the Mideast Gulf to make up the blend. Most output is from the Salman field, the main platform of which was destroyed by US forces during the Iraq-Iran war and was rebuilt in the early 1990s. Other fields are Reshadat and Resalat. With the addition of the Balal field volumes should rise to over 200,000 b/d. Quality Similar in quality to Iran Light. Producers State National Iranian Oil Co. is the exclusive producer. Pricing And Marketing Cargoes are sold on an f.o.b. basis from Lavan Island, with almost all production entering the export market and going mainly to customers in the Asia-Pacific region on a termcontract basis. State Indian Oil Corp. and Japanese companies are the main customers. Extra volumes have sometimes been fed into the Iran Light export stream. Prices are set according to a formula similar to that for Iran Light. Spot sales are rare. Sellers NIOC is the exclusive seller. The firm has offices around the world, including a trading subsidiary in London called Nafta-Iran. NIOC Iran: Crude Oil Marketing, NIOC Central Building, Taleghani Ave., Tehran, Iran. Phone: (98-21) 646-0351. Fax: 98-21) 646-0302. NIOC and Nafta-Iran Intertrade: NIOC House, 4 Victoria St., London SW1H 0NE, UK. Tel.: (44-171) 227-2138, Fax: (44-171) 976-8315. NIOC Toronto: 4950 Young St., Suite 808, North York, Toronto, Ontario, Canada M2N 6K1. Tel.: (416) 459-9426, Fax: (416) 590-9836. NIOC Singapore: 70 Shenton Way, 17-03 Marina House, 0207 Singapore. Tel.: (65) 227-3722, Fax: (65) 227-3622. Loading Port Lavan Island. 26.47 N. 53.20 E. Located on the southeast coastline of Iran, Lavan Island, which is 13 miles long and about 2.5 miles wide, has two crude oil-loading berths and storage capacity for 5.5-million barrels. Ships of up to 200,000 deadweight tons can be accommodated.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic) Hydrogen Sulfide Con. Carbon Residue Wax Content

Unit API /Metric Ton Centistokes at 40 C ppm % Weight % Weight

Year Of Crude Oil Sample: 1993

LAVAN BLEND ASSAY Crude Oil Value Specifications 34.3 Sulfur Content 7.38 Pour Point 4.98 Reid Vapor Press. Nickel ... Vanadium 4.6 Iron 6.95 Lead Sodium

Unit % Weight Temp. C psi ppm ppm ppm ppm ppm

Value 1.87 -25 10 6.6 14 4.7 1.9 2

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H137

SIRRI
Gravity: 30.3 Sulfur: 2.26 Other Names: Sirri Heavy

Iran
Loading Port: Sirri Island

Production About 30,000 barrels a day from an offshore field in the southeastern Mideast Gulf adjacent to Sirri Island. Output could rise to 200,000 b/d in the future, since there is scope for significant further development work in the field. Quality Slightly heavier and higher in sulfur than Iran Heavy. Producer State National Iranian Oil Co. is the exclusive producer. Pricing And Marketing Cargoes are sold on an f.o.b. basis from Sirri Island, with almost all production entering the export market and going mainly to the Asia-Pacific region on a term-contract basis. Japan alone takes over 20,000 b/d. Prices are set according to a formula similar to that for Iran Heavy. Sellers NIOC is the exclusive seller. The firm has offices around the world, including a trading subsidiary in London called Nafta-Iran. NIOC Iran: Crude Oil Marketing, NIOC Central Building, Taleghani Ave., Tehran, Iran. Phone: (98-21) 646-0351. Fax: 98-21) 646-0302. NIOC and Nafta-Iran Intertrade: NIOC House, 4 Victoria St., London SW1H 0NE, UK. Tel.: (44-171) 227-2138, Fax: (44-171) 976-8315. NIOC Toronto: 4950 Young St., Suite 808, North York, Toronto, Ontario, Canada M2N 6K1. Tel.: (416) 459-9426, Fax: (416) 590-9836. NIOC Singapore: 70 Shenton Way, 17-03 Marina House, 0207 Singapore. Tel.: (65) 227-3722, Fax: (65) 227-3622. Loading Port Sirri Island. 25.54 N. 54.33 E. The loading terminal is on the southeast part of the island of Sirri, with crude oil loaded from a one-berth jetty approximately 600 feet offshore that can handle ships up to 330,000 deadweight tons.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic) Con. Carbon Residue Wax Content

Unit API /Metric Ton Centistokes at 40 C % Weight % Weight

SIRRI ASSAY Crude Oil Value Specifications 30.29 Sulfur Content 7.2 Pour Point 7.36 Reid Vapor Press. Nickel 4.9 Vanadium 5.5 Iron Sodium

Unit % Weight Temp. C psi ppm ppm ppm ppm

Value 2.26 -15 8.9 15 45 1.6 9.4

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Naphtha <150 Kerosine 150-250 Gas Oil 250-350 Residue >350 Year Of Crude Oil Sample: 1988 Cut Points Temp. C Yield % Vol. % Wt. 0.95 14.8 12.3 17.5 16.1 18.9 18.8 44.2 49.7

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H139

BASRAH LIGHT
Gravity: 34.4 Sulfur: 2.1

Iraq
Loading Ports: Mina Al-Bakr, Ceyhan (Turkey)

Production Limited by the United Nations embargo that was placed on Iraq following its invasion of Kuwait in 1990. Output was about 300,000 barrels a day, which is less than 50% of capacity until December 1996. Before the embargo, production was over 1.5-million b/d from several fields in the south, including the Rumaila fields, Zubair, and Luhais. Quality Typical light Mideast crude oil similar to Arabian Light, Iran Light, and Dubai. Although the test below is old, it remains broadly representative of Basrah Light. Producer State-owned Southern Oil Co. is the sole producer. Pricing And Marketing Prior to the United Nations-sponsored humanitarian oil sales program in 1996, Basrah provides the countrys only UN-approved exports, with about 50,000 b/d sold to Jordan at discounted prices and delivered over land by tanker truck. Most of the UN-sponsored sales are of Kirkuk grade, with Basrah Light accounting for a smaller share of sales from the Mideast Gulf. Before the invasion of Kuwait, Basrah Light was the only Iraqi crude oil that was widely sold to all of the main world markets: the Far East, Europe, and the Americas. The grade can be loaded from Iraqs southern Mina al-Bakr terminal in the Gulf, or it can be piped north via the Strategic Pipeline and the Turkish export line for loading from Ceyhan, Turkey. Seller State Oil Marketing Organization has been responsible for all international oil sales in the past. SOMO Jordan: Amman, Jordan. Fax: (9626) 694-007. Iraqi Oil Ministry, SOMO: Baghdad, Iraq. Fax: (9641) 885-3014. Loading Ports Mina al-Bakr. 29.41 N. 48.48 E. Located in the northwest end of the Mideast Gulf, southsoutheast of the Shatt-al-Arab waterway and south of the Fao Peninsula, the terminal has been destroyed twice, once in the Iraq-Iran war, and during the bombings that preceded the invasion of Iraq by UN forces in 1991. It has estimated capacity of 300,000-500,000 b/d from three operational berths, but with little storage capacity. Ceyhan/Botas. 36.53 N. 35.56 E. The Ceyhan/Botas terminal, located on the Turkish Mediterranean coast, about 40 miles from the border with Syria, has four crude oil-loading berths. Maximum size is 300,000 deadweight tons at the two outer berths and 150,000 dwt at the two inner berths.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 10 C Cut Points Temp. C/F <85 <185 85-165 185-329

BASRAH LIGHT ASSAY Crude Oil Value Specifications 34.4 Sulfur Content 7.383 Pour Point 12.5 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 2.1 <-30 6.9

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 2.9 1.9 8.2 6.4 14.3 12.4 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Viscosity (Kin) Asphaltenes Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C

58 66 19 15 0.12 0.72 -22 55.3 1.71 1 58.3 5.35 3.71 129 1.74 43 12

Kerosine Light Gas Oil

165-235 329-455 235-300 455-572

12.3 11.6

11.4 11.3

Int. Gas Oil

300-350 572-662

7.1

7.1

% Wt. Temp. C Cen at 40 C % Wt. Cen at 60 C % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

43.8

49.4

Year Of Crude Oil Sample: 1978

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H141

FAO BLEND

Iraq

Gravity: 27.5 Sulfur: 2.9 Loading Port: Mina Al-Bakr Other Names: Basrah Medium, Basrah Heavy (prior to 1981) Production The heavier crude oil produced from the southern Iraqi fields, including Buzurgan and Abu Ghirab near the Iranian border. Output was about 500,000 barrels a day before the United Nations embargo in the summer of 1990. Little if any of this grade is currently in production due to the UN restrictions on exports. Quality Introduced after the end of the Iraq-Iran war in late 1989 as an Arabian Heavy equivalent, the grade is essentially a combination of former 23-gravity Basrah Heavy and 30gravity Basrah Medium plus some other production. Although termed a 27.5-gravity crude oil, quality varied considerably, creating serious marketing problems. The test below is at the light end of the quality range. Producers State-owned Southern Oil Co. Pricing And Marketing No current sales due to the UN embargo against Iraq. Sold mainly to the US and the Far East in late 1989 and early 1990 at a rate of 500,000 b/d with plans to go higher before the invasion of Kuwait. Priced on a formula basis with linkage to spot markets for regional benchmark grades. Seller State Oil Marketing Organization has handled all international oil sales in the past. SOMO Jordan: Amman, Jordan. Fax: (9626) 694-007. Iraqi Oil Ministry, SOMO: Baghdad, Iraq. Fax: (9641) 885-3014. Loading Port Mina al-Bakr. 29.41 N. 48.48 E. Located in the northwest end of the Mideast Gulf, southsoutheast of the Shatt-al-Arab waterway and south of the Fao Peninsula, the terminal has been destroyed twice, once in the Iraq-Iran war, and once during the bombings that preceded the invasion of Iraq by UN forces in 1991. It has estimated capacity of 300,000500,000 b/d from three operational berths, but with little storage capacity.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. F <55 55-175 175-300 Yield % Vol. 2 6.2 10.6

FAO BLEND ASSAY Crude Oil Value Specifications 29.4 Sulfur Content 7.17 Pour Point 10.5

Unit % Weight Temp. F

Value 2.94 -80

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Naphthenes Aromatics Heavy Naphtha Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Gas Oil Sulfur Content Cetane Index Residue Sulfur Content Pour Point Viscosity (Kin) Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. F % Wt.

64 19 11 20 16 0.5 -36 1.79 50 4.83 49 6.86

Heavy Naphtha

300-400

9.3

Kerosine

400-500

9.2

Gas Oil

500-650

13.4

Residue

>650

49.3

Year Of Crude Oil Sample: 1989

% Wt. Temp F Cen at 100 C

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H143

KIRKUK
Gravity: 37.0 Sulfur: 2.00

Iraq
Loading Port: Ceyhan (Turkey)

Production Kirkuk is the countrys single-largest and oldest producing complex, with capacity of 1.3-million barrels a day prior to Iraqs invasion of Kuwait in 1990. Output was about 250,000 b/d from Kirkuk itself and its satellite fields, and has risen to about 600,000700,000 b/d with the UN-sponsored humanitarian oil sales program in late 1996. Capacity is some 800,000 b/d. Other fields in the Kirkuk export stream include Ain Zalah, Jambur, and Butma. Quality Lighter than Arabian Light and Iran Light, but not as high in quality as top Mideast grades such as Abu Dhabi Murban. Although the test below dates from the early 1970s and is slightly heavier than some later assays, it is still broadly representative of Kirkuks characteristics. Quality may have been harmed by the injection of surplus fuel oil into Iraqi fields during the embargo period. Transportation When exported, the crude oil is transported by the 1.6-million b/d capacity Turkish export pipeline, which runs 1,050 kilometers from Kirkuk to the Mediterranean port of Ceyhan. Producers All production under the control of state Northern Oil Co. Pricing And Marketing Prior to the Gulf war, Kirkuk was a mainstay of the sour crude oil market in the Atlantic Basin, with its Mediterranean outlet putting it on an equal footing with Russian exports. Key customers at that time included Brazils state Petrobras, Exxon, Texaco, Coastal, and Tupras of Turkey, and prices were tied to benchmark spot grades. Under the UN-sponsored humanitarian oil sales program, contracts have been reestablished with many of these same firms as well as new ones such as Russian traders and producers. Sellers State Oil Marketing Organization has been the exclusive marketer of Iraqi crude oil in the past. SOMO Jordan: Amman, Jordan. Fax: (9626) 694-007. Iraqi Oil Ministry, SOMO: Baghdad, Iraq. Fax: (9641) 885-3014. Loading Port Ceyhan/Botas, Turkey. 36.53 N. 35.56 E. The Ceyhan/Botas terminal, located on the Turkish Mediterranean coast about 40 miles from the border with Syria, has four crude oil-loading berths. Maximum size is 300,000 deadweight tons at the two outer berths and 150,000 dwt at the two inner berths.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 100 F Cut Points Temp. C/F

KIRKUK ASSAY Crude Oil Value Specifications 35.8 Sulfur Content 7.444 Pour Point 4.61 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 2.06 -36 5.5 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 1.9 1.3 Light Naphtha <85 9.8 7.6 Light Naphtha <185 Octane RON Int. Naphtha 85-165 15.9 14.1 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 14.3 13.4 Kerosine 329-455 Sulfur Content Light Gas Oil 235-300 12.3 12.1 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 8.8 9 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 37.3 42.4 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1971 Nickel KIRKUK TERM-CONTRACT PRICES, 1978-90 Prices At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 1981 1982 1983 Jan. $13.50 $13.83 $29.29 $37.50 $34.21 $34.83 Feb. 13.50 13.83 29.29 37.50 34.21 34.83 March 13.50 15.03 29.29 37.50 34.83 29.83 April 13.50 16.28 29.29 37.50 34.83 29.43 May 13.50 16.98 31.29 37.50 34.83 29.43 June 13.50 20.39 31.29 36.93 34.83 29.43 July 13.17 22.29 33.29 36.93 34.83 29.43 Aug. 13.17 22.00 33.29 36.93 34.83 29.43 Sept. 13.17 22.00 33.29 36.93 34.83 29.43 Oct. 13.17 23.29 33.29 34.93 34.83 29.43 Nov. 13.17 25.29 33.29 34.93 34.83 29.43 Dec. 13.17 27.29 33.29 34.93 34.83 29.43 Month 1986 1987 1988 1989 1990 Jan. $28.18 $17.55 $15.40 $15.72 $19.10 Feb. 28.18 17.60 14.36 16.73 17.58 March 10.50 17.60 14.78 18.39 15.82 April 10.90 17.60 15.48 18.39 14.35 May 12.20 17.60 14.83 17.05 14.33 June 10.35 17.60 14.08 16.05 12.69 July 8.20 17.60 13.75 15.65 15.78 Aug. 11.65 17.60 12.93 16.20 23.98 Sept. 13.00 17.60 11.68 17.20 ... Oct. 12.35 17.60 11.48 17.65 ... Nov. 12.80 17.60 12.78 18.15 ... Dec. 14.80 17.60 14.84 19.89 ...

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C Cen at 100 F % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 62 62 26 12 0.24 0.74 -20 54.9 1.6 3 55.8 6.25 3.86 30/86 179 3.33 9.24 54 <3

1984 $29.43 29.43 29.43 29.43 29.43 29.43 29.43 29.43 29.43 29.43 29.43 29.43

1985 $29.43 28.18 28.18 28.18 28.18 28.18 28.18 28.18 28.18 28.18 28.18 28.18

Note: Official government selling prices until 2/86, netbacks from 3/86-2/87, official prices for remainder of 1987, and average formula prices thereafter. Note: More recent prices can be found in Chapter I.

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H145

KUWAIT
Gravity: 30.5 Sulfur: 2.55

Kuwait
Loading Port: Mina Al Ahmadi

Production Output has been stable at about 1.8-million barrels a day since 1993, following recovery from the Iraqi invasion in 1990. Capacity is about 2.2-million b/d and slated to rise to about 3-million b/d by 2000. The Burgan field is the largest producing area, with capacity of about 1.5-million b/d followed by Ahmadi and Magwa. Kuwaits only other crude oil streams are those from the Neutral Zone and some 100,000 b/d of lighter Marat grade that is produced from areas lying below the main Burgan field. Marat is not marketed separately. Quality A typical medium-heavy Mideast crude oil similar to Arabian Medium and Iran Heavy. Producers All production is controlled by state-owned Kuwait Petroleum Corp. through its Kuwait Oil Co. unit. Pricing And Marketing Some 1-million b/d of Kuwait crude oil was being exported in early 1996, with the balance consumed in the countrys 830,000 b/d of domestic refinery capacity. With the expansion of domestic refining, less crude oil has been available for export in recent years. Refined product exports amount to about 700,000 b/d and are expected to rise further with additional refinery expansion. KPCs crude oil exports include about 50,000 b/d to its European refineries and a similar volume in processing deals in Asia. Kuwait has focused on all of the main international markets in rebuilding its crude oil export volumes, but the Far East is the dominant market with about 50% of the total. Japan alone takes 220,000 b/d. Kuwait prices its crude oil at the prevailing Arabian Medium formulas in the US and Europe and 10 below Arab Medium in Asia. KPC sells its crude oil on a term-contract basis, rarely resorting to spot sales. Sellers Kuwait Petroleum Corp.: P.O. Box 26565, Safat, Kuwait, 13126. Tel.: (965) 2455455, Fax: (965) 246-7159. KPC London: 80 New Bond St., London W1Y 9DA, UK. Tel.: (44-171) 491-4000, Fax: (44-171) 629-2617. Loading Port Mina Al Ahmadi. 29.04 N. 48.09 E. Located on the western shore of the Gulf, the port of Mina Al Ahmadi is Kuwaits main crude oil-export point, and it has been reconstructed following the war with Iraq. The berths at the old Sea Island Terminal are no longer operable and have been replaced by a single-buoy mooring system. Very large crude carrier-sized ships can also be accommodated at the North Pier Terminal and the South Pier Terminal. Mina Al Ahmadi has 18-million barrels of crude oil storage capacity.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 10 C Cut Points Temp. C/F

KUWAIT ASSAY Crude Oil Value Specifications 30.5 Sulfur Content 7.208 Pour Point 29.56 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 2.55 -12 6.2 <3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 2.6 1.7 Light Naphtha <85 7.4 5.6 Light Naphtha <185 Octane RON Int. Naphtha 85-165 12.6 10.8 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 10.6 9.6 Kerosine 329-455 Sulfur Content Freezing Point Light Gas Oil 235-300 10.2 9.7 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 8.1 8 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 49 54.7 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1987 Nickel KUWAIT TERM-CONTRACT PRICES, 1978-93 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 1981 1982 1983 Jan. $12.27 $12.83 $27.50 $35.50 $32.30 $32.30 Feb 12.27 14.03 27.50 35.50 32.30 28.30 March 12.27 15.32 27.50 35.50 32.30 27.30 April 12.27 15.80 27.50 35.50 32.30 27.30 May 12.27 16.40 29.50 35.50 32.30 27.30 June 12.27 19.00 29.50 35.50 32.30 27.30 July 12.27 19.49 31.50 35.50 32.30 27.30 Aug. 12.27 19.49 31.50 35.50 32.30 27.30 Sept. 12.27 19.49 31.50 35.50 32.30 27.30 Oct. 12.27 23.50 31.50 35.50 32.30 27.30 Nov. 12.27 25.50 31.50 33.00 32.30 27.30 Dec. 12.27 27.50 31.50 33.00 32.30 27.30 Month 1986 1987 1988 1989 1990 1991 Jan. $25.75 $17.00 ... $13.78 $17.14 ... Feb. 14.40 16.67 ... 13.98 16.43 ... March 11.35 16.67 13.24 15.38 15.50 ... April 10.20 16.67 14.75 16.83 13.75 ... May 11.05 16.67 14.58 15.53 14.15 ... June 9.65 16.67 13.43 15.20 12.71 ... July 7.40 16.67 12.65 15.23 14.15 ... Aug. 11.75 16.67 12.78 14.70 23.89 ... Sept. 12.50 16.67 11.18 15.33 ... ... Oct. 12.65 16.67 9.43 15.88 ... 17.66 Nov. 13.10 16.67 9.75 15.83 ... 17.12 Dec. 14.50 16.67 11.73 16.90 ... 13.90

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C % Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 60 15 70 15 0.22 -54 0.83 -23 54.1 1.78 -1 56.6 5.43 4.32 24/75.2 343 7.82 11.59 47 19

Note: Official selling prices up to 1986 and from 2/87-12/87. Netback prices in 1986 and 1/87. Prices based only on Far East sales formulas from 1988-93. Note: More recent prices can be found in Chapter I.

1984 $27.30 27.30 27.30 27.30 27.30 27.30 27.30 27.30 27.30 27.30 27.30 27.30 1992 $14.22 14.68 14.73 15.75 16.75 18.12 17.57 16.84 17.40 17.36 16.28 15.28

1985 $27.55 27.30 27.30 27.30 27.30 27.30 27.30 27.30 27.30 27.30 27.30 27.30 1993 $14.24 15.02 15.28 15.38 15.04 14.67 13.42 13.68 13.13 13.83 12.84 11.22

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H147

AMNA
Gravity: 36.1 Other Names: Amal Sulfur: 0.15

Libya
Loading Port: Ras Lanuf

Production About 115,000 barrels a day, mainly from the Amal field, one of the first discoveries in Libya, found in 1959. In decline since the late 1960s. Quality A light, paraffinic crude oil that is a bit heavier and higher in wax than the top-quality Libyan grades. Equity Producers State National Oil Co. 51%, Veba 49%. Pricing And Marketing Priced according to a formula that is linked to spot quotes for dated Brent like all the other main Libyan export grades. No sales to the US due to embargo against Libyan oil that began in 1986. This confines sales almost exclusively to Europe, where Libya has developed an extensive refining and marketing network to guarantee offtake. Amna is one of the waxier Libyan grades, which also restricts sales outlets. Most supplies are taken by Veba as part of its equity supply. Other volumes move to Spains Repsol, Austrias OMV, and German Rheinoel. Sellers National Oil Co.: International Marketing, Administrative Office, P.O. Box 2655, Tripoli, Libya. Tel.: (218) 21-32141, Fax: (218) 21-37149, Telex: 20729. Veba Oel A.G.: P.O. Box 20 10 45 W-4650, Gelsenkirchen 2, Germany. Tel.: (49-209) 3661, Fax: (49-209) 366-7820. Loading Port Ras Lanuf. 30.31 N. 18.35 E. Two terminals located on the southeastern side of the Gulf of Sirte about 12 miles (20 kilometers) south of Es Sider. The former Mobil terminal has three conventional berths designed for tankers of up to 60 feet draft and 130,000 deadweight tons, and one single-point mooring intended for vessels of up to 75 ft of draft and 265,000 dwt. The second terminal has two crude oil-loading berths, with maximum sizes of 50,000 dwt and 41 ft draft.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 37.8 C Cut Points Temp. C/F <49 <120 49-121 120-250 Yield % Vol. 2.4 7.7

AMNA ASSAY Crude Oil Value Specifications 36.1 Sulfur Content 7.462 Pour Point 13.7 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.15 24 3.9

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product Light Naphtha Int. Naphtha Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Intermediate Gas Oil Sulfur Content Residue Sulfur Content Pour Point Vanadium Nickel Unit Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C/F % Wt. % Wt. % Wt. Temp. C/F Parts/mill. Parts/mill. Value 78 69.9 26.5 3.7 0.05 0.86 0.07 0.13 0.22 Sep-48 1.1 8.5

Kerosine

166-228 330-443 228-316 443-600 316-455 600-850 >346 >655

9.4

Light Gas Oil Int. Gas Oil Residue

15 23.3 55.4

Year Of Crude Oil Sample: 1983

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H149

BOURI
Gravity: 26.0

Libya
Loading Port: Bouri

Production After declining to about 60,000 barrels a day output is being restored to previous highs of about 90,000 b/d. A second phase of development could take production considerably higher in the future. The Mediterraneans largest offshore oil field, with 5-billion barrels of oil and considerable gas, was discovered in the early 1980s, but it did not begin producing until 1991. Quality Libyas heaviest crude oil stream is of unusually low quality compared to other North African oils. High natural gas content at the wellhead complicates the production process. Producer Italian Agip is the operator under a production-sharing agreement with state NOC in which its share is now 30%, up from the previous level of 19%. Pricing And Marketing Bouri crude oil almost never appears on the international market, and it is absorbed entirely in producer Agips downstream system. This is understandable given the crude oils relatively poor quality. Prices are generally $2-$3 a barrel below North Sea Brent, but they are largely notional. Seller National Oil Co.: International Marketing, Administrative Office, P.O. Box 2655, Tripoli, Libya. Tel.: (218) 21-32141, Fax: (218) 21-37149, Telex: 20729. Loading Port Bouri. 33.54 N. 12.39 E. An offshore loading facility in the Mediterranean Sea located near the fields two production platforms off the northwest coast of Libya. The facility has 1.3-million barrels of storage.

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BOURI ASSAY Assay not available.

CRUDE OIL HANDBOOK

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H151

BREGA
Gravity: 39.8 Sulfur: 0.20

Libya
Loading Port: Marsa El Brega

Production About 120,000 barrels a day mainly from the Nafoora-Augila complex of fields discovered in 1966 about 200 miles southeast of the Marsa El Brega terminal and between the Amal and Bu Attifel fields. Despite enhanced recovery efforts, output is in decline. Quality Light, high-quality North African oil. Producers All output is controlled by Arabian Gulf Oil Co., a fully owned subsidiary of state National Oil Co. Pricing And Marketing All export sales are handled by NOC with prices set close to similar-quality Zueitina crude oil in recent years. Libyan price formulas are tied to the spot price of UK Brent Blend. In 1995-96 all Brega export volumes were going to Libyas downstream refining and marketing operations in Italy through its Tamoil affiliate. Sellers National Oil Co.: International Marketing, Administrative Office, P.O. Box 2655, Tripoli, Libya. Tel.: (218) 21-32141, Fax: (218) 21-37149, Telex: 20729. Loading Port Marsa El Brega. 30.25 N. 19.34 E. Located on the southeastern shore of the Gulf of Sirte, Marsa El Brega has three crude oil-loading berths with the following restrictions: No. 2, 42 feet draft, 65,000 deadweight tons; No. 3, 48 ft draft, 100,000 dwt; No. 5 (single-point mooring), unrestricted draft, 300,000 dwt.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <85 <185 85-165 185-329

BREGA ASSAY Crude Oil Value Specifications 39.8 Sulfur Content 7.624 Pour Point 3 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.2 0 5.3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 2 1.4 8.9 7.3 17.4 15.8 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt.

67 54 32 14

Kerosine Light Gas Oil

165-235 329-455 235-300 455-572

14.3 12.6

13.8 12.6

% Wt. Temp. C

Int. Gas Oil

300-350 572-662

10

10.2

0.06 -16 56.7 0.18 6 63.6 5.65 0.43 42/107.6 68.1 0.27 2.99 3 11

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

35

38.9

Year Of Crude Oil Sample: 1983 At Port Of Loading In Dollars Per Barrel Month 1987 1988 1989 Jan. $17.90 $18.67 $15.18 Feb. 18.67 15.35 14.63 March 18.67 14.30 16.20 April 18.67 16.25 20.82 May 18.67 16.05 19.40 June 18.67 15.20 18.07 July 18.67 14.65 16.62 Aug. 18.67 14.70 16.72 Sept. 18.67 13.05 17.72 Oct. 18.67 12.25 18.95 Nov. 18.67 12.85 18.75 Dec. 18.67 15.05 19.95
Note: More recent prices can be found in Chapter I.

BREGA TERM CONTRACT PRICES, 1987-93 1990 $21.30 19.77 18.34 16.37 16.31 15.08 17.13 27.31 36.95 37.05 34.21 29.05 1991 $22.14 19.95 19.38 20.27 18.91 18.34 19.86 20.34 21.67 22.40 19.85 18.48 1992 $18.93 17.95 18.80 19.83 20.90 20.81 20.28 20.07 20.53 19.79 18.83 17.94 1993 $17.72 18.65 18.82 18.75 18.50 17.55 16.79 16.75 16.10 16.48 15.03 13.53

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H153

ES SIDER
Gravity: 37.0 Sulfur: 0.27

Libya
Loading Port: Es Sider

Production The countrys largest volume crude oil stream at about 440,000-450,000 barrels a day from the main fields of Defa, Dahra, Gialo, and Waha. Quality Libyas benchmark grade. A high-quality, light, sweet North African crude oil. Producers The operator was the US Oasis group, now renamed Waha. Its equity stakes were divided among state National Oil Co. (59.2%), Conoco (16.3%), Marathon (16.3%), and Amerada Hess (8.2%). However, the involvement of the American companies was completely suspended following US sanctions against Libya in 1986. US firms are prohibited from all Libyan activities, but the companies and the Libyans still hope to eventually resume joint operations. Meanwhile, control is in the hands of NOC. Pricing And Marketing Es Sider is Libyas main export grade, and it used to be regularly traded on Mediterranean spot markets. NOC has gradually cut back on spot sales, preferring to sell its crude oil to its downstream refining and marketing operations in Italy, Switzerland, and Germany, as well as in state-to-state deals and third-party sales to equity producers and Mediterranean refiners. State NOCs term-contract prices for Es Sider and other grades are based on a formula tied to the spot market for UK Brent Blend. Es Sider has the widest range of customers. In 1996 the largest buyers in this group included OMV, an equity producer in Libya, as well as Libyas Italian refining and marketing affiliate Tamoil. Italian independent refiners Isab and Api, Portugal's Petrogal and Turkeys Tupras were also buyers. NOC also runs about 100,000 b/d as feedstock for its domestic refineries. Seller National Oil Co.: International Marketing, Administrative Office, P.O. Box 2655, Tripoli, Libya. Tel.: (218) 21-32141, Fax: (218) 21-37149, Telex: 20729. Loading Port Es Sider. 30.38 N. 18.22 E. Located on the Gulf of Sirte approximately 375 miles southsoutheast of Tripoli, the port of Es Sider has three conventional berths and two singlebuoy mooring berths. Draft and/or tonnage limitations are as follows: numbers 1, 2, and 3 51 feet draft; no. 4 62 ft draft, maximum vessel size 250,000 deadweight tons; no. 5 73 ft draft, maximum vessel size 300,000 dwt.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F

ES SIDER ASSAY Crude Oil Value Specifications 37 Sulfur Content 7.497 Pour Point 4.8 Reid Vapor Press. Hydrogen Sulfide

Unit % Weight Temp. C Lbs/Sq. In. Parts/mill.

Value 0.27 9 7.2 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 3.2 2.1 Light Naphtha <85 8.6 7 Light Naphtha <185 Octane RON Int. Naphtha 85-165 15 13.5 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 12.8 12.2 Kerosine 329-455 Sulfur Content Freezing Point Light Gas Oil 235-300 12.2 12.1 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 9.1 9.3 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 39.4 43.7 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1983 Nickel ES SIDER TERM-CONTRACT PRICES, 1978-93 At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 1981 1982 1983 Jan. $13.80 $14.52 $34.50 $40.78 $36.50 $35.15 Feb. 13.80 15.20 34.50 40.78 36.50 30.15 March 13.80 15.90 34.50 40.78 36.50 30.15 April 13.68 18.08 34.50 40.78 35.15 30.15 May 13.68 21.09 36.50 40.78 35.15 30.15 June 13.68 21.09 36.50 40.78 35.15 30.15 July 13.68 23.28 36.78 39.68 35.15 30.15 Aug. 13.68 23.28 36.78 39.68 35.15 30.15 Sept. 13.68 23.28 36.78 39.68 35.15 30.15 Oct. 13.68 26.05 36.78 39.68 35.15 30.15 Nov. 13.68 26.05 36.78 37.28 35.15 30.15 Dec. 13.68 29.78 36.78 37.28 35.15 30.15 Month 1986 1987 1988 1989 1990 1991 Jan. $25.75 $17.60 $18.52 $14.95 $20.85 $20.84 Feb. 16.55 18.52 15.05 14.40 19.32 18.65 March 13.20 18.52 14.10 15.97 17.89 18.22 April 11.70 18.52 15.95 20.60 15.97 19.27 May 12.45 18.52 15.75 19.15 15.91 17.99 June 10.50 18.52 14.90 17.85 14.68 17.54 July 8.65 18.52 14.35 16.20 16.68 19.06 Aug. 12.30 18.52 14.40 16.30 26.91 19.54 Sept. 13.15 18.52 12.75 17.30 36.60 20.82 Oct. 12.90 18.52 11.95 18.52 36.25 21.55 Nov. 13.70 18.52 12.55 18.32 32.96 18.95 Dec. 15.00 18.52 14.75 19.52 27.75 17.48
Note: More recent prices can be found in Chapter I.

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C % Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 69 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 70 44 49 7 0.04 -53 0.09 -18 53.8 0.27 3 58.7 5.93 0.57 39/102.2 99.3 0.89 5.76 4 14

1984 $30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 1992 $17.93 17.05 17.85 18.88 20.10 20.06 19.53 19.37 19.83 19.14 18.23 17.34

1985 $30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 30.15 1993 $17.12 18.10 18.27 18.20 17.95 16.95 16.19 16.15 15.50 15.88 14.44 12.93

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H155

SARIR
Gravity: 37.6 Sulfur: 0.16

Libya
Loading Port: Marsa El Hariga

Production About 190,000-200,000 barrels a day from the Sarir and North Sarir fields. Quality A light, sweet crude oil with a high wax content that gives it a high pour point and makes it difficult to handle. Producers Output is 100% controlled by state National Oil Co. through its affiliate, Arabian Gulf Oil Co. (Agoco). Pricing And Marketing All export sales are handled by NOC, with prices in the same range as for similar-quality Amna crude oil. Libyan price formulas are tied to the spot price of UK Brent Blend. Due to a US embargo, export sales are mainly in the Mediterranean. Libyas Italian affiliate Tamoil is a regular lifter, as are Italian independent refiners Isab and Api, each taking about 20,000 b/d in 1996. Other customers include Frances Elf, Turkeys Tupras, and Greece. About 70,000 b/d are used in Libyas domestic refineries. Some spot sales have gone to Asia when prices there are attractive. Seller National Oil Co.: International Marketing, Administrative Office, P.O. Box 2655, Tripoli, Libya. Tel.: (218) 21-32141, Fax: (218) 21-37149, Telex: 20729. Loading Port Marsa El Hariga. 32.04 N. 24.00 E. The Mediterranean oil-loading terminal at Marsa El Hariga located on the south side of the harbor of Tobruk, about 100 miles west of the Libya-Egypt border accommodates loading at two jetty berths at a maximum draft of 56 feet. There is also a loading buoy system.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <85 <185 85-165 185-329

SARIR ASSAY Crude Oil Value Specifications 37.6 Sulfur Content 7.524 Pour Point 7.28 Reid Vapor Press. Hydrogen Sulfide

Unit % Wt Temp. C Lbs/Sq. In. Parts/mill.

Value 0.16 21 4.8 <1

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 2.3 1.5 7.1 5.7 13.7 12.3 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

67 50 42 8 <0.01 -50 0.03 -21 61.1 0.1 7 67.4 4.89 0.3 39/102.2 82.2 1 2.99 2 8

Kerosine

165-235 329-455 235-300 455-572

10.7

10.2

Light Gas Oil

11.4

11.1

Int. Gas Oil

300-350 572-662

8.3

8.2

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

46.8

51

Year Of Crude Oil Sample: 1983

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H157

SIRTICA
Gravity: 42.2 Sulfur: 0.40

Libya
Loading Port: Ras Lanuf

Production About 85,000 barrels a day mainly from the onshore Zelten field. Quality A high-quality, light, sweet North African crude oil. Producers Sirte is the operator, and it is owned 100% by state National Oil Co. US Exxon and W.R. Grace were former concessionaires. Pricing And Marketing Sirtica is one of Libyas top-quality crude oils, making it relatively easy to sell in its restricted European market. In 1996, NOCs customers for the grade were Austrian OMV, German Veba and Repsol, all equity producers in Libya, as well as Spanish refiner Cepsa. About 30,000 b/d is used in the Ras Lanuf refinery. NOCs term-contract prices are based on a formula tied to the spot market for UK Brent Blend. Seller National Oil Co.: International Marketing, Administrative Office, P.O. Box 2655, Tripoli, Libya. Tel.: (218) 21-32141, Fax: (218) 21-37149, Telex: 20729. Loading Port Ras Lanuf. 30.31 N. 18.35 E. Two terminals located on the southeastern side of the Gulf of Sirte about 12 miles (20 kilometers) south of Es Sider. The former Mobil terminal has three conventional berths designed for tankers of up to 60 feet draft and 130,000 deadweight tons, and one single-buoy mooring intended for vessels of up to 75 ft of draft and 265,000 dwt. The second terminal has two crude oil-loading berths, with maximum size of 50,000 dwt and 41 ft draft.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 20 C Cut Points Temp. C/F <85 <185 85-165 185-329

SIRTICA ASSAY Crude Oil Value Specifications 42.2 Sulfur Content 7.727 Pour Point 4.2 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.4 0 8.7

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 4.1 2.8 12 9.9 19.5 18 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Content Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

68 49 39 12 0.07 -51 0.17 -13 54.1 0.32 7 58.5 6 0.91 36/96.8 92.7 0.64 5.39 9 27

Kerosine

165-235 329-455 235-300 455-572

14.5

14.3

Light Gas Oil

12.3

12.6

Int. Gas Oil

300-350 572-662

8.6

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

29.1

33.4

Year Of Crude Oil Sample: 1984

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H159

ZUEITINA
Gravity: 41.5 Sulfur: 0.31 Other Names: Libyan Light

Libya
Loading Port: Zueitina

Production Output has been in decline, falling to about 70,000 barrels a day in 1995-96 from the Intisar system, which is a network of five fields. Quality A light, sweet crude oil similar to US West Texas Intermediate. Producers Zueitina Oil Co., a joint venture between state National Oil Co. (87.5%) and Austrian OMV (12.5%), which replaced the former US Occidental-led producing group after the forced withdrawal of US companies in 1986 due to Washingtons sanctions. Pricing And Marketing The grade is sometimes traded in the Mediterranean, but NOC mainly sells it to its Italian affiliate Tamoil and equity producers such as Austrian OMV and German Veba. Like other Libyan grades, the price formula is tied to dated Brent, and price terms are set on a monthly basis. Zueitina is usually the highest-priced Libyan export grade. Sellers National Oil Co.: International Marketing, Administrative Office, P.O. Box 2655, Tripoli, Libya. Tel.: (218) 21-32141, Fax: (218) 21-37149, Telex: 20729. OMV AG: Otto Wagner Platz 5, A-1090, Vienna, Austria. Tel.: (43-1) 404-400, Fax: (431) 9453. OMV (UK) Ltd.: 14 Ryder St., London SW1Y 6QB, UK. Tel.: (44-171) 333-1600, Fax: (44-171) 333-1610. Loading Port Zueitina. 30.51 N. 20.00 E. The Zueitina sea terminal consists of five crude oil-loading berths, two of which are conventional-buoy moorings and three of which are single-buoy moorings. The CBM berths are 2.5 miles offshore at an average depth of 70-80 feet, while the SBM berths are approximately three miles offshore at an average depth of 100 ft.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F

ZUEITINA ASSAY Crude Oil Value Specifications 41.5 Sulfur Content 7.699 Pour Point 3.13 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.31 12 5.6

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 2.2 1.5 Light Naphtha <85 8.9 7.3 Light Naphtha <185 Octane RON Int. Naphtha 85-165 18.7 17.1 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 16.2 15.7 Kerosine 329-455 Sulfur Content Light Gas Oil 235-300 12.7 12.8 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 9.3 9.7 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 32.2 35.9 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Year Of Crude Oil Sample: 1983 Nickel ZUEITINA TERM-CONTRACT PRICES, 1986-93 At Port Of Loading In Dollars Per Barrel Month 1986 1987 1988 1989 1990 1991 Jan. $30.40 $17.85 $18.67 $15.20 $21.35 $24.68 Feb. 30.40 18.67 15.40 14.65 19.82 19.96 March 30.40 18.67 14.40 16.22 18.39 19.56 April 30.40 18.67 16.25 20.87 16.42 20.27 May 13.00 18.67 16.05 19.45 16.36 19.06 June 11.25 18.67 15.20 18.12 15.13 18.76 July 9.10 18.67 14.65 16.65 17.18 19.86 Aug. 12.75 18.67 14.70 16.75 27.36 20.34 Sept. 13.35 18.67 13.05 17.75 37.00 21.67 Oct. 13.25 18.67 12.25 18.97 37.20 22.45 Nov. 14.05 18.67 12.85 18.77 34.26 19.90 Dec. 15.30 18.67 15.05 19.97 29.05 18.53 ZUEITINA SPOT PRICES, 1987-93 Month 1987 1988 1989 1990 1991 1992 Jan. $17.85 $16.50 $17.10 $21.25 $24.45 $24.45 Feb. 17.00 15.40 16.75 19.75 20.45 20.45 March 17.55 14.40 18.50 18.35 19.85 19.85 April 18.00 16.30 20.05 16.55 19.55 19.55 May 18.45 16.05 18.60 16.25 19.40 19.40 June 18.70 15.30 17.40 14.90 18.20 18.20 July 19.30 14.80 17.50 16.95 19.55 19.55 Aug. 18.70 14.75 16.65 26.45 19.85 19.85 Sept. 17.85 12.95 17.70 33.55 20.75 20.75 Oct. 18.35 12.20 18.80 37.15 22.60 22.60 Nov. 17.45 12.90 18.60 33.75 21.70 21.70 Dec. 16.80 15.40 19.75 28.95 18.95 18.95 Note: More recent prices can be found in Chapter I.

Unit Clear Octane % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Value 65 57 34 9 0.08 0.21 -10 57.1 0.33 8 61.9 5.71 0.56 39/102.2 56.6 0.54 4.99 2 9

1992 $18.98 18.05 18.85 19.83 20.90 20.81 20.28 20.07 20.53 19.79 18.83 17.94 1993 $17.45 18.55 18.85 18.70 18.60 17.75 16.95 16.85 16.15 16.60 15.20 13.65

1993 $17.72 18.65 18.82 18.75 18.50 17.55 16.84 16.80 16.15 16.53 15.08 13.58

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H161

BINTULU CONDENSATE
Gravity: 66.2 Sulfur: 0.04

Malaysia
Loading Port: Bintulu

Production About 60,000 barrels a day of condensate from offshore fields on the northern coast of Sarawak (Borneo) in eastern Malaysia, just to the west of Brunei. Condensate output is growing as associated natural gas production increases. Volumes are expected to reach 100,000 b/d or more by 2000. The area produces large volumes of natural gas for Malaysias liquefied natural gas export projects. Bintulu grade, which is also light and low in sulfur, was included in the condensate export stream until 1991, but it is now sold separately. Its output is less than 50,000 b/d. Quality Very light condensate with excellent petrochemical and gasoline manufacturing characteristics. Producer Operated by the Royal Dutch/Shell Group under a production-sharing contract with state Petronas. Pricing And Marketing Up until early 1996, volumes were used almost exclusively in the domestic Malacca refinery, but exports are increasingly common, with the first term contracts pricing the grade at a slight discount to Malaysian benchmark Tapis grade. Sellers Petronas: International Marketing Division, Menara Dayabumi Komplex, Dayabumi, Kuala Lumpur, Selangor, Malaysia 50778. Tel.: (60-3) 274-8011, Telex: MA31123 PETRON. Loading Port Bintulu. 03.16 N. 113.04 E. The Bintulu terminal, located off the coast of Sarawak, consists of a single-buoy mooring loading system positioned in the open sea. The facilities can accommodate tankers with a maximum 320,000 deadweight tons and a maximum draft of 52 feet.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F 15-65 59-149

BINTULU CONDENSATE ASSAY Crude Oil Value Specifications 66.2 Sulfur Content 8.8 Pour Point 0.58 Reid Vapor Press.

Unit % Weight Temp. C Lbs/sq. in.

Value 0.04 -37 6

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Gasoline Yield % Vol. 2.6 33.7 Properties Light Gasoline Paraffins Naphthenes Aromatics Light Naphtha Paraffins Naphthenes Aromatics Intermediate Naphtha Paraffins Naphthenes Aromatics Heavy Naphtha Paraffins Naphthenes Aromatics Jet Kerosine Smoke Point Freezing Point Unit Value

Light Naphtha

65-90 149-194

19.2

% Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. % Wt. Temp. C Temp. C

91 8 0.4 42 55 2.6 32 57 9.8 40 30 26.8 18 -54

Int. Naphtha

90-115 194-239

17.7

Heavy Naphtha

115-140 239-284

9.1

Jet Kerosine

140-165 284-329 185-200 200-225 >225

5.5

Kerosine Gas Oil Residue

4.7 2.6 4.9

Year Of Crude Oil Sample: 1992

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H163

DULANG
Gravity: 39.9 Sulfur: 0.12

Malaysia
Loading Port: Dulang Terminal

Production About 100,000 barrels a day from a group of small fields off the east coast of the Malay Peninsula adjacent to Exxons Trengganu area. Output is expected to grow, but flow rates are subject to the restrictions of Malaysias national depletion policy. The field extends into Exxons area, and the firm receives a share of the output under a unitization agreement. Quality A light, low-sulfur crude oil with high wax content and a high pour point. Quality is variable, with high metals content making the grade undesirable for cracking and thus often relegated to use as boiler feed. Producer Operated by Petronas Carigali, the upstream unit of state Petronas. Exxon receives about a 20% share of production because the field extends into its area. Pricing And Marketing All production is exported, but the grade is used mainly as a boiler fuel in southern China and Japan. As with other Malaysian crude oils, Petronas sets prices retroactively at the end of each month in response to Asian spot market trends. Seller Petronas: International Marketing Division, Menara Dayabumi Komplex, Dayabumi, Kuala Lumpur, Selangor, Malaysia 50778. Tel.: (60-3) 274-8011, Telex: MA31123 PETRON. Loading Port Dulang. 05.45 N. 104.10 E. A deep-water offshore loading terminal supported by a floating storage vessel.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic) Wax Content Asphaltenes Con.

Unit API /Metric Ton Centistokes at 50 C % Wt. % Wt.

DULANG ASSAY Crude Oil Value Specifications 39.9 Sulfur Content 7.64 Pour Point 3.342 Flash Point Hydrogen Sulfide 12.6 Water Content 0.1 Conradson Car. R

Unit % Weight Temp. C Temp. C Parts/mill. % Vol. % Wt.

Value 0.12 30 13.5 0.002 0.05 0.36

Year Of Crude Oil Sample: 1991 No refined product breakdown available.

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H165

LABUAN
Gravity: 32.1 Sulfur: 0.07

Malaysia
Loading Port: Labuan

Production About 80,000 barrels a day from offshore fields on the north coast of Sabah Province (Borneo) in eastern Malaysia. Output peaked in 1990 at around 120,000 b/d, and it is now in decline from the Samarang, Ketam, West Erb, St. Joseph, St. Furious, Barton, and Tembungo fields that make up the stream. Quality A medium-gravity, low-sulfur Asian crude oil with an excellent middle distillate yield, which makes it popular for both straight-run refining and cracking. Producers The Royal Dutch/Shell Group operates all of the fields under a production-sharing agreement with state Petronas. Pricing And Marketing About 60,000 b/d of production is exported, but the low-sulfur grade rarely leaves the Far East and often ends up in Singapore. Japanese buyers take about 35,000 b/d. Like all of Malaysias five export grades, Labuan is priced retroactively by state Petronas based on spot quotes for Tapis appearing in Platts and Asian Petroleum Price Index plus a variable monthly differential. Prices are generally quite close to much lighter Tapis, reflecting successful niche marketing by Petronas. Sellers Petronas: International Marketing Division, Menara Dayabumi Komplex, Dayabumi, Kuala Lumpur, Selangor, Malaysia 50778. Tel.: (60) 3-274-8011, Telex: MA31123 PETRON. Shell Malaysia Trading Sdn. Bhd.: Jalan Semantan, Damansara Heights, Kuala Lumpur, Malaysia. Tel.: (60-3) 255-9144, Fax: (60-3) 251-2957. Shell International Eastern Trading Co.: 50 Raffles Place, #39-00 Shell Tower, 0104 Singapore. Tel.: (65) 224-7777, Fax: (65) 224-0379. Loading Port Labuan. 05.17 N. 115.15 E. The Labuan terminal is located on the island of Labuan, 4.5 miles off the northwest coast of Borneo at the entrance to Brunei Bay. The single-buoy mooring loading berth is designed for tankers of up to 320,000 deadweight tons and maximum draft of 74 feet.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F <85 <185 85-165 185-329

LABUAN ASSAY Crude Oil Value Specifications 32.1 Sulfur Content 7.28 Pour Point 2.67 Reid Vapor Press.

Unit % Weight Temp. C Lbs/sq. in.

Value 0.07 9 3.3

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Product LPG Light Naphtha Int. Naphtha Yield % Vol. % Wt. 0.7 0.5 5.2 4.3 16.3 14.8 Properties Light Naphtha Octane RON Intermediate Naphtha Paraffins Naphthenes Aromatics Kerosine Sulfur Content Freezing Point Light Gas Oil Sulfur Cloud Point Cetane Index Intermediate Gas Oil Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Conradson Carbon R Vanadium Nickel Unit Value

Clear Octane % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C

79 26 48 26 0.02 -59 0.04 -31 34.9 0.12 5 44.8 6.53 0.18 39/102.2 40 0.06 1.3 <1 2

Kerosine

165-235 329-455 235-300 455-572

18

17.4

Light Gas Oil

24.2

24.7

Int. Gas Oil

300-350 572-662

13.2

13.6

% Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. % Wt. Parts/mill. Parts/mill.

Residue

>350 >662

22.7

24.7

Year Of Crude Oil Sample: 1983

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H167

MIRI
Gravity: 29.6 Sulfur: 0.07 Other Names: Miri Light

Malaysia
Loading Port: Miri

Production About 60,000 barrels a day from a group of offshore fields on the northern coast of the province of Sarawak (Borneo) in eastern Malaysia and from the onshore Miri field. The fields lie along the western border of Brunei and in addition to Miri include Baram, Bakau, Baronia, Betty, Bokor, Tukau, and Siwa. Production is in decline after peaking at about 140,000 b/d in 1990. Quality A typical low-sulfur Asian crude oil with high wax content and high pour point. The grade was significantly lighter in the early 1980s, and quality has deteriorated as satellite fields have been introduced into the stream. Producers The Royal Dutch/Shell Group controls 100% of all of the fields through its Shell Sarawak affiliate under a production-sharing agreement with state Petronas. Pricing And Marketing About 45,000 b/d is exported. It often goes to Singapore as well as to Northeast Asia, with Japan taking about 30,000 b/d mainly for use as boiler fuel. Shell also uses the grade in its domestic refining system in Malaysia. Like all of Malaysias five export grades, Miri is priced retroactively by state Petronas on the basis of spot quotes for Tapis from Platts and the Asian Petroleum Price Index plus a variable differential. Prices are generally quite close to Tapis despite its inferior quality. Sellers Petronas: International Marketing Division, Menara Dayabumi Komplex, Dayabumi, Kuala Lumpur, Selangor, Malaysia 50778. Tel.: (60) 3-274-8011, Telex: MA31123 PETRON. Shell Malaysia Trading Sdn. Bhd.: Jalan Semantan, Damansara Heights, Kuala Lumpur, Malaysia. Tel.: (60-3) 255-9144, Fax: (60-3) 251-2957. Shell International Eastern Trading Co.: 50 Raffles Place, #39-00 Shell Tower, 0104 Singapore. Tel.: (65) 224-7777, Fax: (65) 224-0379. Loading Port Miri. 04.26 N. 113.55 E. The Miri terminal, located off the coast of Sarawak, has four single-buoy mooring berths situated in the open sea. The following maximum specifications hold: No. 1 draft 37 feet, tonnage 30,000 deadweight tons; No. 2 37 ft, 75,000 dwt; No. 4 39 ft, 100,000 dwt; No. 5 56 ft, 125,000 dwt.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic) Wax Content Asphaltenes

Unit API /Metric Ton Centistokes at 50 C % Wt. % Wt.

MIRI ASSAY Crude Oil Value Specifications 29.6 Sulfur Content 7.18 Pour Point 4.208 Flash Point Hydrogen Sulfide 38 Water Content 0.47

Unit % Weight Temp. C Temp. C Parts/mill. % Vol.

Value 0.07 12 -18 26 <0.05

Year Of Crude Oil Sample: 1992 No refined product breakdown available. MIRI TERM-CONTRACT PRICES, 1978-93 Prices At Port Of Loading In Dollars Per Barrel Month 1978 1979 1980 Jan. ... $15.05 $33.60 Feb. ... 15.05 33.60 March ... 16.18 35.30 April ... 18.45 35.30 May ... 18.45 35.30 June ... 20.90 37.30 July ... 23.70 37.30 Aug. ... 23.70 37.30 Sept. ... 23.70 37.30 Oct. 14.30 23.70 37.30 Nov. 14.30 26.75 37.30 Dec. 14.30 26.75 37.80 Month 1986 1987 1988 Jan. $27.25 $17.35 $16.90 Feb. 23.25 17.85 17.25 March ... 17.75 16.75 April ... 17.75 16.10 May ... 17.90 16.70 June ... 18.15 16.70 July ... 18.35 14.75 Aug. 10.80 18.60 14.65 Sept. 12.45 18.35 14.00 Oct. 13.30 18.15 12.40 Nov. 13.80 18.40 12.10 Dec. 14.15 17.90 13.70
Note: More recent prices can be found in Chapter I.

1981 $41.30 40.80 40.80 40.80 39.80 39.10 37.10 37.10 37.10 37.10 37.10 37.10 1989 $16.45 17.95 17.80 18.80 19.25 18.80 18.55 17.70 17.40 18.15 18.90 19.25

1982 $36.50 36.50 36.50 35.60 35.60 35.60 35.60 35.60 35.60 35.60 35.60 35.60 1990 $20.05 20.45 19.95 18.65 16.70 15.45 15.00 20.90 29.60 38.80 36.20 31.40

1983 $35.60 29.85 29.85 29.85 29.85 29.85 29.85 29.85 29.85 29.85 29.85 29.85 1991 $27.30 22.70 19.30 18.30 18.70 19.70 19.90 20.10 20.30 21.60 22.65 23.30

1984 $29.85 29.85 29.85 29.85 29.85 29.85 29.85 29.85 29.85 29.85 29.85 29.85 1992 $21.15 19.50 18.65 18.25 19.60 21.20 22.85 22.45 21.65 21.35 21.15 20.30

1985 $29.85 27.95 27.95 27.95 27.95 27.95 27.25 27.25 27.25 27.25 27.25 27.25 1993 $19.20 19.00 20.05 20.70 20.25 19.40 18.85 18.85 18.85 18.20 17.60 15.95

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H169

TAPIS
Gravity: 45.2 Sulfur: 0.03 Other Names: Tapis Blend, Pulai

Malaysia
Loading Port: Tapis

Production About 340,000 barrels a day is produced from a cluster of fields offshore the eastern coast of the Malaysian Peninsula. Output is expected to decline gradually from these mature fields, and flow rates are also subject to the restrictions of Malaysias national depletion policy. Quality A high-quality, light, low-sulfur Asian crude oil. Especially prized for its wide cut of kerosine and gas oil. However, the smoke point of the kerosine can pose quality problems. Producers Exxon holds 100% of the fields and operates under a production-sharing agreement with state Petronas. Pricing And Marketing The spot market for this light, sweet grade provides a marker for the region with about four to six wet barrel spot deals a month. Although both Exxon and Petronas are sellers, Exxon uses the grade mainly in its own downstream system and Petronas also has been using more domestically. Exports amount to about 150,000-200,000 b/d, with sales all over the region. Japan imported about 25,000 b/d in 1995, and significant volumes are also refined in Singapore. Other customers include South Korea, India, Indonesia, and Thailand. Petronas uses a monthly retroactive official selling price that is tied directly to average quotes from Platts and the Asia Petroleum Price Index plus an adjustment factor. Tapis also provides the basis for extensive paper trading and swaps. Sellers Petronas: International Marketing Division, Menara Dayabumi Komplex, Dayabumi, Kuala Lumpur, Selangor, Malaysia 50778. Tel.: (60-3) 274-8011, Telex: MA31123 PETRON. Exxon Malaysia Berhad: Kompleks Antarabangsa, Jalan Sultan Ismail, 50718 Kuala Lumpur, Malaysia. Tel.: (60-3) 240-3087, Fax: (60-3) 242-2322. Exxon Singapore Private Limited: 1 Raffles Place, #37-00 OUB Centre, 0104 Singapore. Tel.: (65) 535-5533, Fax: (65) 535-2797. Loading Port Tapis. 05.31 N. 105.01 E. The Tapis terminal is a deep-water offshore loading and storage facility located in the South China Sea. Maximum vessel size is 100,000 deadweight tons.

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Crude Oil Specifications Gravity (60 F) Barrels Viscosity (Kinematic)

Unit API /Metric Ton Centistokes at 40 C Cut Points Temp. C/F

TAPIS ASSAY Crude Oil Value Specifications 45.2 Sulfur Content 7.863 Pour Point 1.72 Reid Vapor Press.

Unit % Weight Temp. C Lbs/Sq. In.

Value 0.03 6 5.2

REFINED PRODUCT BREAKDOWNS AND PROPERTIES Yield Product % Vol. % Wt. Properties LPG 1.9 1.3 Light Naphtha <85 6.2 5.2 Light Naphtha Int. Naphtha 85-165 20.7 19.7 Intermediate Naphtha 185-329 Paraffins Naphthenes Aromatics Kerosine 165-235 25 24.6 Kerosine 329-455 Sulfur Content Light Gas Oil 235-300 19.4 20 Light Gas Oil 455-572 Sulfur Content Cloud Point Cetane Index Int. Gas Oil 300-350 10.6 11 Intermediate Gas Oil 572-662 Sulfur Content Cloud Point Cetane Index Viscosity (Kin) Residue >350 16.4 18.2 Residue >662 Sulfur Content Pour Point Viscosity (Kin) Asphaltenes Vanadium Year Of Crude Oil Sample: 1981 Nickel TAPIS TERM-CONTRACT PRICES, 1986-93 At Port Of Loading In Dollars Per Barrel Month 1986 1987 1988 1989 1990 1991 Jan. $27.90 $18.00 $17.20 $16.75 $20.35 $27.60 Feb. 23.90 18.55 17.55 18.25 20.75 23.00 March 17.10 18.45 17.05 18.10 20.25 19.60 April 13.50 18.45 16.40 19.10 18.95 18.60 May 12.50 18.60 17.00 19.55 17.00 19.00 June 12.85 18.85 17.00 19.10 15.75 19.90 July 10.50 19.05 15.05 18.85 15.30 20.20 Aug. 11.35 19.30 14.95 18.00 21.00 20.30 Sept. 13.00 18.85 14.30 17.70 29.70 20.90 Oct. 13.80 18.80 12.70 18.45 39.10 21.90 Nov. 14.35 18.80 12.40 19.20 36.50 22.95 Dec. 14.80 18.00 14.00 19.55 31.70 23.60 Month Jan. Feb. March April May June July Aug. Sept. Oct. Nov. Dec. 1987 $18.20 18.40 18.25 18.55 18.60 18.80 19.20 19.20 18.65 18.85 18.60 17.45 1988 $17.40 17.55 16.15 17.00 17.10 16.50 14.95 14.95 13.90 12.45 12.95 15.30 TAPIS SPOT PRICES, 1987-93 1989 1990 1991 1992 $18.00 $20.60 $24.85 $20.30 18.00 20.45 21.30 19.45 18.35 19.75 18.95 18.35 19.60 18.20 18.60 18.95 19.20 16.75 19.30 20.35 19.00 15.25 19.95 22.35 18.55 16.50 20.10 23.25 17.65 25.60 20.40 22.55 17.80 31.90 21.40 21.75 18.85 38.55 22.40 21.50 19.35 35.50 23.50 21.15 19.80 29.10 22.70 20.05

Unit

Value

% Wt. % Wt. % Wt. % Wt. % Wt. Temp. C % Wt. Temp. C Cen at 40 C % Wt. Temp. C/F Cen at 60 C % Wt. P