News Wrap

IN TODAY's wrap: Chevron close to a deal on importing foreign workers for Gorgon; Statoil may exit Shtokman project, Shell a potential replacement; OPEC likely to keep production quota at upcoming meeting; and market opens higher.

Chevron

Close on the heels of Gina Rinehart's Roy Hill project striking an enterprise migration agreement with the federal government to import up to 1715 workers, Chevron is close to striking a similar deal for its Gorgon project, The Australian Financial Review reports.

The paper suggested that importing foreign workers could be key to the US energy major meeting its budget and timeline for the project.

The EMA program, put in place by the federal government to address skills shortages facing the resources sector, allows 14 big projects to negotiate with the government to bring in foreign workers. 15 other projects that meet the $2 billion capex criteria will also be eligible to seek foreign workers if they employ 1500 people during the peak phase.

It is understood that both Santos and Japan's Inpex are also in line to negotiate EMAs with the government.

Statoil

Norway's Statoil is likely to exit the Shtokman LNG project in Russia and may be replaced by Royal Dutch Shell, Dow Jones reported.

The newswires cited the Russian daily Kommersant as saying that Russia's Gazprom, which holds a majority 51% stake in the gas field, may review the list of participants in its project to develop the Shtokman field next month.

The paper said changes may be announced at the St.Petersburg economic forum in late June.

France's Total and Statoil hold a 25% and 24% stake respectively in the project, which has faced several delays in reaching a final investment decision.

Statoil will still retain interest in Russia, having inked a deal with Rosneft earlier this month to explore in the Russian Arctic.

OPEC

OPEC is likely to keep its production quota unchanged in the upcoming meeting, Dow Jones reports, citing unnamed OPEC delegates.

The news comes as oil prices drop, shaving off the Iranian premium, as talks progress to end the stalemate on Iran's nuclear program.

The wire quoted a delegate as saying that there was no need for a change at the moment as "prices are starting to drop to satisfactory level, which is what we want."

OPEC members are producing about 1 MMbpd above the previous target of 30MMpd, with Saudi Arabia contributing most of the surplus to offset reduced supplies from Iran due to sanctions.

While member countries have supported high oil prices, Brent crude reaching record levels of $US128 a barrel in March was seen as too high even by OPEC, which feared demand destruction due to high prices.

But a price closer to $100 per barrel mark is seen as acceptable.

Market

And finally, the local bourse opened stronger, amid renewed optimism about Greece staying in the Euro zone. On Friday, oil inched a tad higher with the benchmark WTI closing at $US90.86 a barrel as jitters over Iran continued.

At 10.15 AEST, the benchmark S&P/ASX200 was up 21 points to 4050.2, while the All Ords was up 20 points at 4101.2 points.

On Friday, overseas markets were mixed, with all the three indices lower. S&P 500 lost 0.2% while the Dow Jones Industrial Average was down 0.6% and the NASDAQ shed 0.07%.

Across the pond, stocks moved sideways in the UK, with the FTSE 100 up 0.03%.

The markets in the US will be closed today for the Memorial Day holiday.

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