Mozart, Chopin, Marie Antoinette .. Cowboys & Indians!! ..and even Shrek!! turned up at the 'Viennese' themed annual SPE masquerade ball held at the Perth Convention Centre on 4th August. RP sponsored three tables that featured many ladies resplendent in their beautiful gowns. The standout RP guest was one Zorro, who turned up complete with sword and whip! They were all feted to a very sumptuous meal in the beautifully decorated hall and many were seen dancing late into the night..
		RP Staff and Guests at the SPE Ball

 

 RP signs with Granherne

RP took another leap forward last month when it signed an 'alliance' agreement with Granherne, which would basically give their prospective clients a 'one stop shop' for integrated field development solutions.

RP's CEO David Callaghan said that because of the individual strengths of the two companies, their coming together would enable them to provide a unique service for their clients by combining subsurface and facilities capabilities to deliver robust and well-integrated development concepts. He said the alliance with Granherne, a highly respected front-end engineering design company which has worked on over 3,000 projects in 20 countries, would be beneficial for both parties as it would also allow further expansion and diversification of their client base. "With our strength in our subsurface integrated teams, this alliance enables us to offer our clients a very unique integrated service - something that is rarely offered," he said.

Many corporate strategists believe that business collaboration is the way for companies to move forward in the current competitive business environment. Since such companies have already established a niche in their own business area, forming alliances would enable them to forge ahead in the more sophisticated markets of today. David said RP took a very serious approach to business alliancing," choosing and carefully vetting our partners so that there will be a synergy in the partnership and an element of trust to ensure that the relationship is sustainable."

According to JCP Consultancy Services, business alliances can create added value for the companies, as by joining forces and working together, mutual benefits that could not easily be achieved alone, can be realised.

RP's Director Frances Corless signed the agreement with Granherne Pty Ltd's Director, Steve Cook. 

 

1st Global Field Development Planning Conference

RP Integrated's General Manager and intrepid reporter Paul Dominic's conference notes:

The IQPC organized Field Development Planning Conference was held in Kuala Lumpur over two days  starting from 31st July. The blurb that accompanied the  conference brochure said "achieving your production targets through accurate development of FEED/FDP strategies that match budgetary and scheduling constraints while managing uncertainties"

		As Field Development Planning is a subject close to his heart, RP Integrated's General Manager made the trip to KL with moderate expectations. In addition, a very persuasive Ang Kar Wee, the Oil and Gas Business Development Manager from IQPC had convinced RP Integrated to become a literature sponsor at the conference. The conference started on a very positive note for our doubting GM when he spotted copies of RP Integrated's corporate literature laid out on every participant's table area. This helped with introductions as our speech weary GM only had to point to the literature when he introduced himself to the 60 conference attendees over the two days.
Dog and man ponder meaning of FDP

The relatively small number of conference attendees ensured that fruitful and in-depth discussion could be had with most attendees and strong relationships established. Another plus was the spread of representation from different companies and geographical areas.

There also were some outstanding presentations which deserve to be briefly mentioned. Murphy Oil, who are relative newcomers to the Malaysian Oil and Gas scene, presented two outstanding papers; the first was on the development of their shallow water marginal fields offshore Sarawak and the second on their Kikeh Deepwater development.

The first paper by Ian Williams illustrated how Murphy has come up with a life cycle plan to monetise the small gas discoveries in the Balingian Province Offshore Sarawak through a phased development concept.

The second paper by Steve Dechant explained how Murphy Oil developed the Kikeh Deepwater Discovery in world class time (five years from discovery to first production). The process that was used and the lessons therein should be adopted by anyone intending to fast track a greenfield development successfully.

Kikeh also scored a number for firsts,  the primary one being that it has the distinction of being the first deepwater development in Malaysia. According to Steve, one of the critical success factors behind the Kikeh Development was the use of highly experienced staff in the Project Team and a "No Change" philosophy that was strictly managed using a quarterly review process that would have allowed change if warranted.

Other papers that warrant mention were Oscar Chona's "Waterflood Implementation in the St. Joseph Field" and Teh Yat Hong's "Field Level Approach" to addressing key development issues in the high CO2 content marginal gas fields offshore Peninsular Malaysia.

The now very enthusiastic GM would like to extend his compliments to Wan Rohaimi b Wan Ismail of Petronas Carigali and Dr. Mohammad Keramati of the National Iranian Oil Company for their very competent conference chairing over the two days and to IQPC staff for a very well run conference. 

 

Wine Tasting

RP once again hosted another successful wine tasting session last month. The flavour of the month was white wines from New Zealand and Australia supplied by Claremont Cellars.
The 2006 Saint Clare Pinot Gris from the Marlbourgh region was favoured among the tasters for its 'elegant complex flavours with hints of apples and pears.' Margaret River's 2005 Watershed Viognier, described as a delicate wine with fragrant smoky flavours, also came up tops.

RP Director Frances Corless enjoying a glass of white with Geoff Weir

 

Crude Oil Prices

The US benchmark, West Texas Intermediate (WTI) crude closed at an all time high of over US$78.00 at the end of trade on Tuesday 31st July on strong bullish trading sentiment and broad supply concerns. It closed at US$78.19, 24 cents higher than its previous record high of US$77.95 reached on July 14, 2006. WTI was trading at a slight premium over Brent crude which settled just above the US$77 mark.

Prices slumped the week before but a stabilisation of the US equities market helped push prices up. The increase this week was attributed to rising consumer confidence in the US and supplies at Cushing returning to normal levels as more refineries continue to come back in operation.

In the past two months crude prices have risen more than 20 per cent due to the combination of supply reductions from the North Sea and Nigeria, refinery outages, and expectations that the world supply would not be able to meet demand at the end of the year.
Analysts expected prices to stay high on expectations that the EIA will report a further drop in US crude stocks and OPEC's reluctance to call for an increase in production amongst its member countries when it meets in September.

One energy analyst predicted that crude prices could hit US$85 a barrel by the end of the year and US$100 a barrel by 2009 because the expanding world economy is making it difficult for oil companies to keep up with the growing demand.

 

Market Commentary

The Australian share market has felt the brunt of the US share market sell-off losing about eight per cent of its value in the past fortnight. The declines were triggered by further revelations by hedge funds and banks of substantial losses in the sub prime mortgage market. "Sub prime" is the term used for mortgages given to borrowers with poor credit histories seeking to buy a house in the US.

With the notable exception of Macquarie, Australian banks have been quiet on the topic to date. Last week Macquarie warned that investors in two of its investment funds could lose up to 25 per cent of their value given their exposure to risky credit instruments (including US sub-prime bonds). On 6 August 2007, leading credit rating agency Standard & Poors somewhat reassured investors stating ".we have reviewed the rated Australian banks' exposure to U.S. subprime mortgage-related instruments. it is expected that in almost all cases, their exposure to these instruments is either minimal or manageable at this time."

A quick analysis of Australia's leading 20 companies shows that not all market sectors were impacted to the same extent during this period of turbulence. Banking stocks outperformed, supported by their defensive qualities and attractive dividend yields. Cyclical stocks such as resources and those exposed to capital markets (eg. MBL, BHP, RIO) underperformed.

 

Australia's Leading 20 Companies - Share Price Movement

Company	Share Price 6/8/07	Movement 24/7/07 - 6/8/07
AMP Ltd (AMP)	$9.88	- 5.9%
ANZ Bank (ANZ)	$27.99	- 4.8%
BHP Billiton (BHP)	$35.71	-7.9%
Brambles (BXB)	$11.25	+ 1.5%
Commonwealth Bank (CBA)	$53.00	- 6.6%
Coles Group (CGJ)	$13.78	- 9.0%
CSL Limited (CSL)	$85.95	- 5.5%
Foster's Group (FGL)	$5.86	- 7.9%
Macquarie Bank (MBL)	$70.06	- 21.7%
National Aust. Bank (NAB)	$37.37	- 8.0%
QBE Insurance (QBE)	$29.39	- 6.6%
Rio Tinto (RIO)	$87.03	- 12.5%
St George Bank (SGB)	$33.40	- 4.0%
Suncorp (SUN)	$18.93	- 6.1%
Telstra (TLS)	$4.58	- 4.6%
Westpac Bank (WBC)	$25.67	- 4.2%
Westfield (WDC)	$18.80	- 4.1%
Westfarmers (WES)	$38.08	- 5.9%
Woolworths (WOW)	$26.37	- 4.7%
Woodside (WLP)	$42.20	- 6.6%
S&P/ASX 20 Index	3163pts	- 6.9%

Source: IRESS & ASX

Despite the jitters in global equity markets we believe the outlook for the Australian share market is still positive. We expect positive drivers to include a continuation of robust domestic economic conditions, the need to invest mandatory superannuation contributions, reinvestment of dividend payments, reinvestment of proceeds from buyouts and potentially further corporate activity. The main risks include the strengthening AUD$, cost pressures, weakness in offshore equity markets, deterioration in the outlook for the domestic economy and rising bond yields.