MEC&F Expert Engineers : 05/06/15

Wednesday, May 6, 2015

Oil Analysts (aka, clueless clowns) Practice Cautious Capitulation as Crude Surprises


Published in Oil Industry News on Wednesday, 6 May 2015

Graphic for Oil Analysts Practice Cautious Capitulation as Crude Surprises in Oil and Gas News
As oil prices climbed above $68 Tuesday for the first time since December, analysts at some of the world’s biggest banks were holding onto views that this would be a bad year for crude -- just not as terrible as they originally predicted.
Rather then extending last year’s losses, Brent, the global benchmark, has rallied about 50 percent from a six-year low in January as demand accelerated and the rapid growth in supplies started to slow.
The rebound is a shock. At the start of 2015, Bank of America Corp., Barclays Plc and Goldman Sachs Group Inc. all predicted that oil might collapse to about $30 a barrel. Now, though, they are raising their price estimates while remaining skeptical that crude will gain much above current levels. There are still risks, including U.S. shale oil coming back into the market with the increase in prices, they say.
“We’re past the lows for the oil market,” Sabine Schels, an analyst at Bank of America in London, said by phone. “The balances are tightening. This is most visible in the U.S., where the surplus has eased significantly. Supply is still greater than demand, but less than it used to be.”
Boosting Estimates
Bank of America raised its 2015 Brent crude forecast to $58 in a report on April 24, from $52 previously. The bank said in a report dated Jan. 15 that Brent would “spiral down” to $31, and West Texas Intermediate crude, the U.S marker, to $32, by the end of the first quarter. Brent rose as high as $115.71 last June.
Barclays raised its 2015 forecast for average Brent prices to $60 in a report on April 28, up from $51 in February and $44 in January, citing surprisingly strong Chinese demand growth of 700,000 barrels a day in the first quarter. Concern that the conflict in Yemen will curb Middle East supplies, and output disruptions from Norway to Mexico added to the revision.
“The range seems to have shifted with the price discovery process,” Miswin Mahesh, an analyst at Barclays in London, said by phone. “It seems like a comfortable level now. What’s changed is how quickly demand has adjusted higher. The first-quarter China numbers are a great example.”
U.S. drillers cut the number of oil rigs in operation by 55 percent since the start of the year, according to Houston-based field-services company Baker Hughes Inc. Rigs targeting U.S. oil slid by 24 to 679, the lowest level since September 2010, Baker Hughes said on May 1. The nation’s output from tight-rock formations will decline in May, according to the Energy Information Administration.
More Aggressive
“U.S. producers have responded more aggressively than we had expected,” Goldman Sachs analysts including New York-based Damien Courvalin said in an April 6 report. This gives “modest upside” to their three-month price target for WTI of $40, according to the report. The bank wasn’t able to make analysts available to interview for this article.
JPMorgan Chase & Co., which predicted that Brent could fall to $38 in March, raised its forecasts for the year to $62 on April 30.
“It’s a tighter market than we were expecting and I think demand is the culprit,” David Martin, JPMorgan’s London-based head of global oil strategy, said by phone on May 1. “Our view back in January was the build in stocks was really going to weigh on the crude market and depress the front end of the crude curve. We’ve seen upside surprises in demand, which have allowed refiners to run harder and absorb that crude.”
More Demand
Refiners globally processed an extra 1 million barrels a day last quarter compared with a year earlier. The bear market in Brent crude ended without the most pessimistic estimates being realized. Futures have risen from a six-year low of $45.19 on Jan. 13 and were at $68.95 on the London-based ICE Futures Europe exchange at 9:39 a.m. local time.
Citigroup’s Ed Morse predicted in a report dated Feb. 9 that prices would “bottom” by the start of the second quarter, with WTI falling toward $20. Goldman Sachs said in a report dated Jan. 11 that Brent would trade at about $42 in early April. Goldman president Gary Cohn told CNBC on Jan. 26 that prices could fall to $30.
Still, analysts maintain the view prices will struggle to advance significantly in the second half.
U.S. shale supplies will prove more resilient than anticipated, as drilling resumes with rebounding prices, and demand in emerging economies will struggle to climb further as fuel subsidies are removed, Bank of America and Barclays predict. WTI may suffer a “double-dip” to $50 in the third quarter, Bank of America says.
“Growth in emerging markets is still fairly uncertain -- higher oil prices would risk the recovery we’re seeing there,” said Barclays’s Mahesh, who forecasts Brent will average $61 and $66 in the third and fourth quarters respectively. “I wouldn’t say the worst is completely in the rear-view mirror.”
Source: www.bloomberg.com

DHC Contracting knowingly put workers at risk of trench collapse hazards at Guyton, Georgia work site

May 6, 2015

Employer name: James Marlowe, doing business as DHC Contracting, Statesboro, Georgia 

Inspection site: At the time of the inspection, workers were installing a replacement manhole at the South Effingham Waste Water Effluent Pump Station on Hodgeville Road, Guyton, Georgia 31312

Date inspection initiated: The Occupational Safety and Health Administration initiated the Oct. 29, 2014, inspection as part of the agency's National Emphasis Program on Trenching and Excavation. OSHA inspectors were driving by the excavation when they observed an unprotected trench that could collapse and trap the workers. 

Inspection findings: OSHA issued the employer one willful citation for allowing employees to work in an excavation without cave-in protection. OSHA requires that all trenches and excavation sites 5-feet or deeper be protected against sidewall collapses. Protection may be provided through shoring of trench walls, sloping of the soil at a shallow angle or by using a protective trench box. 

Additionally, three serious citations were issued for failing to provide a safe entrance and exit from the trench, not requiring employees to wear head protection while working in a trench where falling objects could result in injury and allowing employees to use a chop saw to cut concrete without wearing proper eye protection. 

Quote: "James Marlowe was at the work site watching his employees work in an unprotected excavation and recognized the hazardous condition that existed, but didn't take action to protect them from being engulfed and crushed by a wall collapse," said Robert Vazzi, OSHA's area director in Savannah. "For an employer to knowingly disregard the lives of their workers is unconscionable." 

Proposed penalties: $57,900

The citations can be viewed at: http://www.dol.gov/opa/media/press/osha/OSHA20150768fs.pdf*

DHC Contracting has 15 business days from receipt of its citations and proposed penalties to comply, request a conference with OSHA's area director or contest the findings before the independent Occupational Safety and Health Review Commission.

To ask questions, obtain compliance assistance, file a complaint or report workplace hospitalizations, fatalities or situations posing imminent danger to workers, the public should call OSHA's toll-free hotline at 800-321-OSHA (6742) or the agency's Savannah Area Office at 912-652-4393.

SINCE 9/11/2001, WE HAVE LOST VERY FEW PEOPLE TO TERRORIST ACTS. BUT WE LOST 500,000 PEOPLE ON THE DEADLY ROADS. AN ADDITIONAL 5 MILLION HAVE BEEN INJURED. OUR INVESTMENT PRIORITIES ARE CLEARLY MISPLACED









MAY 6, 2015

UNITED STATES STILL HAS ONE OF THE HIGHEST ROAD ACCIDENT DEATH AND INJURY RATES IN THE WORLD: 34,000 DIE AND 2.5 MILLION INJURED EACH YEAR.

Despite the improvements in road safety, the United States has one of the highest death rates at about 1 person dead per 10,000 people. Unfortunately, only undeveloped countries have higher death rate.

Since 9/11/2001, we have lost very few people to terrorist acts.  But we lost 500,000 people on the deadly roads.  An additional 5 million people have been injured.  Our spending priorities are clearly misplaced.  Investment in our road infrastructure is what is needed, as the economic toll from all these deaths and injuries and property damage has suffocated our economy.

Thus far this year alone, we have lost 12,000 people to road accidents and an additional 130,000 people have been injured.

Some states, such as Texas and West Virginia (sorry, WV, despite your tremendous progress in traffic safety, you are still at the top of the worst-death-rate list) have death rates of nearly 1.5 percent, i.e., fifty percent more people die compared to the national death rate.

Approximately 34,000 people are getting killed each year.  In the 1950s and 1960s, about 55,000 people used to die on the roads – so, there has been improvement in the number of dead. 

However, the number of injured is rising.  Roughly 2.5 million are injured (yes, you read it correctly – 2.5 million injured) per year.  That is, 1 percent (1%) of the population that is eligible to drive is injured every year.

It is worse than a war zone out there.  

So, please be safe and be on the lookout for aggressive drivers, weaving-through-the-traffic drivers, crazy drivers, reckless drivers, sick drivers, medical-condition drivers, sleepy drivers, negligent drivers, stupid drivers, careless drivers, drunk drivers, speeding drivers, drugged drivers, texting drivers, talking-on-the-phone drivers, looking-at-the-GPS drivers, hurry-hurry drivers, tailgating drivers, upset drivers, eating-while-driving drivers, putting-the-lipstick-on-while-driving drivers, elderly drivers, and so on.

As we always say: it is better to arrive late at your current destination, than to arrive early at your final destination.  Slow down at intersections, let the aggressive drivers go first, it does not worth it getting you or your family injured or killed.  

Drive safely.  Learn from these deadly tragedies and slow down.  IF YOU MUST GO, THEN TAKE IT SLOW.


1 ARRESTED AFTER ATHENS, ALABAMA BUDGET INN METH LAB EXPLOSION




MAY 6, 2015

ATHENS, AL (WAFF)

There was a confirmed meth lab explosion at the Budget Inn on Highway 31 in Athens on Wednesday morning, according to Athens Police Chief Floyd Johnson.
One person has been arrested, according to Athens police.

The Budget Inn manager said the alarm was triggered in room 123 for smoke around 4:45 a.m.

The manager said he ran into the room and saw smoke. He saw two people in the room, and the woman in the room told him it was just a grease fire and that she had been cooking hamburgers. 

The manager said the man and woman looked frightened and he got them to come out of the room. He then called police and they discovered drugs. The manager said he is letting police handle the investigation.

The Budget Inn has not been completely evacuated, and other residents remain in the hotel.
No one was injured in the explosion, according to police

TRACTOR-TRAILER CRASH AND FUEL SPILL ON ROUTE 4 EAST IN TEANECK, NEW JERSEY




MAY 6, 2015

TEANECK, NEW JERSEY

A tractor-trailer crash and fuel spill on Route 4 east has closed two of the highway’s three lanes until 10 a.m., officials said.
The tractor-trailer crashed into the guardrail at River Road and spilled about 80 gallons of diesel fuel, Teaneck Fire Department Battalion Chief Mike Weiss said. No one was hurt, but property damage did occur.

The fire department contained the spill to the roadway and the state Department of Transportation will send crews to clean it up, he said.
Source: nj.com

ONE PERSON WAS KILLED IN A CESSNA 172G SKYHAWK PLANE CRASH SUNDAY MORNING AT THE PENN YAN AIRPORT.






MAY 4, 2015

PENN YAN, NY

One person was killed in a plane crash Sunday morning at the Penn Yan airport. Officials identified the pilot as 55-year-old Steven Seely of Ontario County. They say he was the only person inside the plane.

We're told Seely was a member of the Penn Yan Flying Club but owned his own plane that he kept at the airport. Officials say he was a student pilot. A preliminary investigation indicates he was practicing take offs and landings.
   
Deputies say Seely is from Stanley and tell us he is the owner of Seely Engine Machine in Ontario County. According to our news partners at the Messenger Post, a barn at Seely's business was heavily damaged by fire earlier this year.

The Yates County Sheriff told us when Seely tried taking off on the 5,500-foot runway and once he got into the air, he spun around and took a nose dive. The tail went up against the fence near the tree line beside the runway. Seely was dead on scene.

While nothing is official, investigators pointed to two possible causes: a medical episode or mechanical failure. "I’m saying those are probably the number of factors that could have taken place,” said Yates County Sheriff Ron Spike.

Seely owned a student pilot’s license and was a member of the Penn Yan Flying Club. The plane itself was a personal aircraft -- a single-engine Cessna. FAA  investigators were on scene Sunday along with Sheriff’s deputies.

NTBS investigators arrive Monday morning. The hope is that they'll be able to put a few more of the pieces together then. They'll be relying on interviews with the few witnesses who were golfing at a nearby country club at the time of the crash.

"Witnesses told us, from a nearby golf course, had told us that they saw the plane didn't get higher than 100 feet off the ground when it came back down and veered off,” said Sheriff Spike.

Seelys wife was out of town at the time of the accident and we understand he has a large family and it took deputies a while to notify everyone.


Date:
03-MAY-2015
Time:
11:38
Type:
Owner/operator:
Private
Registration:
N3969L
C/n / msn:
17254138
Fatalities:
Fatalities: 1 / Occupants: 1
Other fatalities:
0
Airplane damage:
Substantial
Location:
Penn Yan Airport (KPEO), Penn Yan, NY -   United States of America
Phase:
Take off
Nature:
Unknown
Departure airport:
Penn Yan (KPEO)
Destination airport:


Narrative:
The aircraft impacted airport terrain shortly after takeoff from Penn Yan Airport (KPEO), Penn Yan, New York. The airplane sustained substantial damage and the sole pilot onboard received fatal injuries.

Sources: 

http://m.chronicle-express.com/article/20150503/NEWS/150509935 http://www.asias.faa.gov/pls/apex/f?p=100:95:0::NO::P95_EVENT_LCL_DATE,P95_LOC_CITY_NAME,P95_REGIST_NBR:03-MAY-15,PENN%20YAN,N3969L http://registry.faa.gov/aircraftinquiry/NNum_Results.aspx?NNumbertxt=N3969L