Daily Archives: February 6, 2017

Despite strong local opposition, the Japanese authorities began offshore construction work aimed at relocating a US Marine Corps base on the island of Okinawa.

The US Marine Corps Air Station Futenma is being moved from densely populated Ginowan to a less populated location in eastern Okinawa the Henoko coastal area of Nago. Last week, US Defense Secretary James Mattis and Japanese Prime Minister Shinzo Abe held talks in Tokyo and agreed to go ahead with the plan.

The offshore construction work, which started on Monday, will see over 200 concrete blocks dumped in the sea to create a screen, preventing debris and sediment generated from coastal revetment work from damaging the environment.

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Tokyo will also make sure that an undersea survey in the area is carried out, using the same vessels which earlier delivered the blocks to the site, Kyodo news agency reported.

Based on relevant law, the government will pay as much consideration as possible to the natural environment and the livelihoods of local people as we move forward with work to relocate (the base to) Henoko, Yoshide Suga, Japanese chief cabinet secretary, said.

Around 100 people gathered outside Camp Schwab, another US base near the construction site, to protest the relocation again on Monday.

The demonstrators held banners reading No to new Henoko base and Independence from colonialism, AP reported.

Many residents, including Okinawa Governor Takeshi Onaga, object to the heavy US military presence on the island, saying that the Futenma base should be removed, not just relocated.

They cite jet crashes related to the US bases and sexual assaults linked to US military personnel as major reasons for concern.

Large-scale protests against the US bases, which gather thousands of people, are staged regularly on the island.

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Onaga is now expected to refuse the renewal of a permit for moving coral reefs in the construction area, which expires in March, in order to stall the Futenma base relocation, Kyodo said.

The Okinawa governor visited Washington last week, reiterating his strong stance against the US bases on the island.

US military bases occupy 6 percent of the whole of Japan and 70 percent of those US military bases are in places where the population density is about the same as Tokyo. I don't like it anymore, Onaga said.

The Futenma base relocation began in October 2015, but was suspended due to resistance from the Okinawa authorities and population.

The work was resumed by the government on December 27 after the Supreme Court rejected an injunction order earlier issued by the Okinawa governor.

This is a country ruled by law, and we feel that both the state and Okinawa Prefecture will cooperate and act sincerely in continuing with the reclamation work, in line with the Supreme Court ruling, Cabinet Secretary Suga said.

READ MORE: US F-35 fighter jets arrive at military base in Japan in 1st overseas deployment

Tokyo believes that the relocation of the base is the only solution to move it away from the densely populated area, while not undermining the Japan-US security alliance.

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Japan begins offshore construction work on moving US base in Okinawa - RT

Rig contractor Diamond Offshore Drilling Inc's chief executive officer, Marc Edwards, said on Monday oil prices needed to be "well over $60" to spur a recovery in offshore drilling.

The company's shares reversed course and were down 6.4 percent at $15.98, with investors shrugging off a beat on quarterly profit and revenue.

Global benchmark Brent crude prices LCOc1 have stabilized after a more than two-year slump, with prices hovering around $55 per barrel.

"Offshore drilling is cyclical in nature, and despite some stabilization in the price of oil we have yet to see a floor in the declining demand of deepwater assets," Edwards said on a post-earnings call with analysts.

"I think (a recovery in demand) is more than likely to be pushed out into 2019 or 2020."

Barclays analysts said last week they expected the offshore floating rig count to bottom at year-end and start to inflect in 2018. Evercore analysts said they expected the offshore downturn to break later this year.

Offshore projects, which take years to develop and are capital intensive, were the hardest hit by the slump in crude prices as oil and gas producers slashed spending.

However, the benefits of the recent recovery in crude prices have largely eluded offshore operators as oil and gas companies prefer to deploy capital in their onshore projects.

Diamond Offshore said it executed a new contract for the Ocean Monarch rig with BHP Billiton in Australia. The contract is scheduled to start at the end of the second quarter and run through late third-quarter of 2017.

Diamond Offshore, majority owned by Loews Corp, said total revenue fell 29.5 percent to $391.9 million, but beat analysts' average estimate of $358.3 million.

Contract drilling revenue rose 13.3 percent to $384.6 million from the third quarter. Evercore ISI had estimated revenue for the business of $356.1 million.

Diamond Offshore's adjusted profit of 27 cents per share beat analysts' average estimate of 13 cents, according to Thomson Reuters I/B/E/S.

The big beat was powered by the Houston-based company's cost cuts, with total operating expenses plunging nearly 68 percent in the three months ended Dec. 31.

However, the company does not anticipate material changes to its base cost trends in the coming quarters, Chief Financial Officer Kelly Youngblood said on the call.

Diamond Offshore also said it expects first-quarter revenue to be flat, compared with the fourth quarter.

The company's shares had fallen about 9.5 percent in the past 12 months, through Friday's close.

(Reporting by Vishaka George and Arathy S Nair in Bengaluru; Editing by Sriraj Kalluvila)

SAO PAULO The status of sugar in the Mercosur trade bloc is likely to be discussed by the presidents of Brazil and Argentina when they meet on Tuesday, Brazil's Agriculture Minister Blairo Maggi said on Monday.

LONDON Hedge funds have accumulated a record bullish position in crude futures and options, betting on further price rises, but the lopsided nature of the positioning has become a key source of risk in the oil markets.

NEW YORK A rally that took raw sugar prices to a more than four-year high in late 2016 is expected to run out of steam this year as Brazil's main producing region looked set for record output that will reduce a world supply deficit, a Reuters poll showed.

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Diamond Offshore sees recovery when oil 'well over $60' - Reuters

This daily digest focuses on Yuan rates, major Chinese economic data, market sentiment, new developments in Chinas foreign exchange policies, changes in financial market regulations, as well as market news typically available only in Chinese-language sources.

- The offshore Yuan maintained stronger than the PBOCs fix and the onshore Yuan on Monday.

- Hong Kong is the major hub for capital flowing into mainland in terms of foreign direct investment.

- Would you like to know more about trading? DailyFX webinars are a great place to start.

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Yuan Rates

- The PBOC lowered the Yuan by -50 pips or -0.07% against the U.S. Dollar to 6.8606 on Monday, the weakest level since January 20th. The onshore Yuan was slightly stronger than the guided level, with the USD/CNY trading at 6.8599 as of 10:30am EST. The offshore Yuan, on the other hand, was over 500 pips stronger than both the onshore Yuan and the Yuan fix, with the USD/CNH trading at 6.8093.

USD/CNH 1-Day

Prepared by Renee Mu.

An offshore Yuan stronger than the onshore Yuan is less common, though not necessarily causes a major concern. However, the offshore rate has been stronger than the PBOCs guided level since January 4th, except on January 27th and 30th when the daily fix was not updated due to the Lunar New Year. Without the regulators recognition, the offshore Yuans strength may not be sustainable and thus, traders will want to be cautious about near-term reversals.

Data downloaded from Bloomberg; chart prepared by Renee Mu.

- The CFETS Yuan Index, the primary measure of the Yuan against a basket of currencies, fell -0.19% to 94.03 last Friday, marking it the third consecutive drop on a weekly basis. Over the same span of time, the BIS Yuan Index declined as well, by -0.30% to 95.26 while the SDR Yuan Index rose +0.08% to 95.43.

Data downloaded from Bloomberg; chart prepared by Renee Mu.

- The PBOC suspended open market operations on Monday despite that there were 150 billion Yuan reverse repos to be matured on the day. This is seen as a further move that the Chinese regulator plans to bring monetary policy back to neutral from slightly loose. From Tuesday to Friday, there will be additional 475 billion Yuan of reverse repos to be matured. Market participants will want to keep a close eye on whether the PBOC will continue to withdraw liquidity.

Market News

Sina News: Chinas most important online media source, similar to CNN in the US. They also own a Chinese version of Twitter, called Weibo, with around 200 million active usersmonthly.

- Foreign investors holdings in Chinese government bonds dropped -1.9 billion Yuan to 421.8 billion Yuan as of the end of January. This is the first decline on a monthly basis since October 2015. A weaker Yuan may have impacted foreigners interest in Yuan-denominated bonds.

Chinaforex News: a news agency administrated by SAFE

- Foreign Direct Investment (FDI) to China rose +4.1% in 2016 to 813.2 billion Yuan ($126.0 billion) from a year ago. In specific, FDI from Hong Kong was $87.2 billion, taking up the most of all. This does not mean all the investment was made by Hongkongers; rather, it shows that the majority of capital flowing into mainland was through the financial hub - Hong Kong. Investment to China directly from other countries and regions, especially Western countries, was much lower than from Hong Kong: it was $6.2 billion from the U.S., $3.1 billion from Japan, $2.7 billion from Germany and $2.2 billion from the U.K.

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China's Market News: Offshore Yuan at Cross Roads Amid Widened Spread - DailyFX

Japan's government started offshore construction work Monday on relocating a U.S. Marine base on Okinawa.

The step marks the beginning of the main construction to move Marine Corps Air Station Futenma to Henoko, a less populated area on the island's east coast.

It comes just days after U.S. Defense Secretary Jim Mattis during a visit to Tokyo reaffirmed with Japanese leaders that the Henoko plan is the only option.

Workers are to dump large concrete blocks into sea to create undersea silt curtains to reduce environmental impact a process needed before creating a coastal embankment and subsequent landfill.

The relocation has stalled for over 20 years due to persistent protests. About 100 people gathered outside Camp Schwab, a U.S. base near the construction site, to protest. The held up placards with messages such as "No to new Henoko base" and "Independence from colonialism."

Many residents complain about the large American troop presence on Okinawa and want the Futenma base removed, not relocated.

Monday's move follows a series of legal battle between Japan's central government and the island, which ended up with a supreme court decision rejecting an injunction order back by Okinawa.

Okinawa Gov. Takeshi Onaga, seeking to block the construction, is expected to refuse to renew a current permit for moving coral reefs in the designated area when it expires at the end of March, according to media reports.

Chief Cabinet Secretary Yoshihide Suga told reporters that the central government is determined to "move forward with the relocation work," while paying attention to environment and the livelihoods of residents.

Follow Mari Yamaguchi on Twitter at https://www.twitter.com/mariyamaguchi

Find her work at http://bigstory.ap.org/content/mari-yamaguchi

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Offshore Work Begins on Relocating US Base on Okinawa - ABC News

Hornbeck Offshore Services (HOS) Given Average Rating of Hold by Brokerages Sports Perspectives Hornbeck Offshore Services logo Hornbeck Offshore Services (NYSE:HOS) has been assigned a consensus rating of Hold from the twelve research firms that are currently covering the company. Three research analysts have rated the stock with a sell rating ... and more »

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Hornbeck Offshore Services (HOS) Given Average Rating of Hold by Brokerages - Sports Perspectives

Ocean Installer has recently completed the very first permanent subsea installation at the Johan Sverdrup field, marking the kick-off of the Johan Sverdrup offshore work.

The offshore campaign took place late January in line with project plans and schedule and involved the installation of a subsea template for water injection. The template weighed 290 ton and was installed making use of the CSV Normand Vision.

This was a very complex lift, taking place during what is normally one of the most challenging offshore months in the North Sea. But thorough planning and excellent cooperation with Statoil ensured that the campaign went very smoothly, says Steinar Riise, CEO of Ocean Installer.

This is the first offshore campaign Ocean Installer will be executing for Statoil on Johan Sverdrup this year, and before the summer Ocean Installer will have installed two more subsea templates for water injection on the field.

We are very happy that Statoil have chosen us as one of the contributors to this important project on the Norwegian Shelf and we are looking forward to the next offshore Sverdrup campaign, says Riise.

Ocean Installer was awarded the Johan Sverdrup work February last year as part of a larger Statoil contract for subsea installation works that also covered Gina Krog and Oseberg Vestflanken. Together this constitutes a significant portion of Statoils planned subsea construction work on the NCS for the 2017 season.

Read the article online at: https://www.oilfieldtechnology.com/drilling-and-production/06022017/first-offshore-installation-work-completed-on-johan-sverdrup/

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First offshore installation work completed on Johan Sverdrup - Oilfield Technology