Platts - Friday, February 03, 2006 http://www.platts.com ------------ US NRC seeks data on reliability of nuke plants' off-site power Washington (Platts)--3Feb2006 US Nuclear Regulatory Commission staff is asking all nuclear power plant operators in the country to provide additional information detailing their efforts to ensure the reliability of off-site electrical power sources in the event of a disruption to the electricity transmission grid. In a generic letter to plant operators, agency staff said the Aug 14, 2003, blackout caused nine US nuclear power plants to shut down. When "the grid is lost or significantly degraded," the protective circuits of the nuclear reactor and the turbine generator automatically shut down the plant to protect equipment. Nuclear facilities are designed with back-up power sources, typically emergency diesel generators, to provide power to essential safety systems. During the blackout, diesel generators kept the nine plants in a safe condition, NRC said. But staff said an agency review of the events surrounding the blackout raised several issues, including how plants prearrange for backup power from local sources and how they monitor the grid in real time. Plant operators have 60 days from the issuance of the letter to submit written responses to questions in several areas, including a description of the arrangements between the plants and grid system operators or reliability coordinators, to monitor the grid's ability to provide power to a plant's safety systems. The agency also is asking for details on procedures in place for identifying local power sources that could assist the plant when normal off-site power is unavailable. For more nuclear news, take a trial to Platts Nucleonics Week at http://nucweek.platts.com. ------------ NEI: U.S. power reactors operated at near-record levels in 2005 Washington (Platts)--2Feb2006 U.S. power reactors produced roughly 783-billion net KWH in 2005, posting near-record levels of electricity production and reliability, industry officials told Wall Street analysts today in New York. The 103 power reactors' average capacity factor was 89.7%, the Nuclear Energy Institute (NEI) said in a press release on the analysts' conference. "Last year's electricity production mark is second only to the 2004 record of 789-billion" kilowatt-hours (KWH), NEI said. It added that the 2005 average capacity factor was the third-highest ever, coming in behind the 2004 record of 90.5% and the 90.3% average posted in 2002. ------------ Crude prices rebound on Iranian nuclear comments London (Platts)--1Feb2006 Global crude oil futures rebounded Wednesday after Iran's top nuclear negotiator warned of renewed industrial-scale uranium enrichment and ahead of US commercial crude stocks data due out later in the day. The rebound in prices followed earlier losses on OPEC's decision to keep crude oil output unchanged at the group's meeting in Vienna Tuesday. Prices had eased with the official OPEC announcement. The NYMEX March West Texas Intermediate crude oil contract jumped 15 cts to $68.07/bbl at 1303 GMT from Tuesday's close, after trading as low as $67.33/bbl in electronic trade. IPE March Brent climbed 39 cts higher to $66.38. Speaking during a news conference, top nuclear negotiator Ali Larijani said the Islamic republic will resume industrial-scale uranium enrichment if a dispute over its nuclear program is referred to the UN Security Council. "If Iran's case is referred or reported to the Security Council, the Islamic republic will be obliged to halt all voluntary measures, which means Iran's cooperation will decrease," Larijani said. "The government will be obliged to remove suspensions, which includes industrial-scale enrichment, and it will do so." Iran says it only wants to enrich uranium to make reactor fuel for an energy drive, but the process can be extended to make weapons-grade material. Crude prices had moved lower earlier on expectations for US crude stock data and on the OPEC output decision. US crude oil inventory data due out later Wednesday from the Energy Information Administration and American Petroleum Institute is expected to show a 1.7-mil bbl build in commercial crude stocks, according to analysts surveyed by Platts Tuesday. Analysts polled by Platts are also projecting a build in gasoline inventories of 1.3-mil bbl and a 900,000 bbl increase in distillate stocks for the week ending Jan 27 . Refinery utilization was expected to fall another 0.3%. "Refinery runs will likely show a decline as a result of additional seasonal refinery maintenance," energy consultant Jim Ritterbusch said in a report. Elsewhere, US President George Bush held a speech in which he introduced a initiative to reduce the US from dependence on Middle Eastern oil by more than 75% by 2025 in a move to break what he called the US' addiction to oil. "Keeping America competitive requires affordable energy," Bush said. However, market reaction to US President George W. Bush's state of the union address was relatively limited, said one London-based broker. There was nothing in his speech to fuel bearish sentiment, the source added. "There was nothing in his speech [Bush's] to fuel the market... bearish long term, but very long term, if at all," said one trading source. For more information, take a trial to Platts Global Alert at http://globalalert.platts.com. ------------ Nuclear energy to get more research funding, Bush says Washington (Platts)--1Feb2006 Nuclear energy is part of a new DOE research program to get increased funding, President George W. Bush announced last night in his State of the Union address. The new Advanced Energy Initiative also focuses on clean coal-fired plants, solar, and wind technologies. Bush said the program is designed to help the U.S. kick its "addiction to oil" by developing vehicles that run on alternative fuels. Bush said his goal is for the country to cut 75% of its oil imports by 2025. Although his energy initiative was short on details, Bush's call for the U.S. to "make our dependence on Middle Eastern oil a thing of the past" drew cheers and applause from Republican and Democratic lawmakers. Details of the energy initiative are expected to be laid out in the administration's budget proposal next week ------------ Constellation credits outage management for 2005 gains Washington (Platts)--31Jan2006 Improved refueling outage management gained Constellation $41-million on its balance sheet in 2005, the company said today. Constellation Energy reported net income of $623.1-million for the year; the comparable figure for 2004 was $539.7-million. The company said it had incurred an after-tax charge of $15.6-million in the fourth quarter for costs associated with its planned merger with FPL Group. ------------ Daukoru says Iran has given assurances it won't cut oil exports Vienna (Platts)--31Jan2006 Iran has assured its fellow OPEC members that it will not withhold oil if its dispute with the international community over its nuclear program escalates, OPEC president Edmund Daukoru told a press conference after the oil producers' cartel agreed to maintain current output levels and to review the situation in March. "He assured me on their own part they were not going to shut in production," Daukoru said, referring to Iran's oil minister Kazem Vaziri Hamaneh. "OPEC will carry on on the basis that supply and production [from Iran] will continue." The Iranian oil minister earlier told reporters ahead of the OPEC meeting that Tehran had "no reason" to cut oil exports and that there was "no linkage" between oil and the nuclear issue. OPEC's Vienna talks have been overshadowed by the dispute between Iran and the international community over Tehran's nuclear program, and in London talks late Monday, the five permanent members of the UN Security Council and Germany agreed to refer the Iranian dossier to the Council but to postpone any UN action until March when the head of the International Atomic Energy Agency submits a report. OPEC's 28-mil b/d official ceiling covers ten members but not Iraq. For more information, take a trial to Platts Oilgram News at http://oilgramnews.platts.com. ------------ Bush to speak on nuclear energy in State of the Union address Washington (Platts)--30Jan2006 President George W. Bush plans to talk about nuclear energy in tomorrow's State of the Union address, but the White House was releasing few details ahead of the speech. White House spokesman Scott McClellan indicated at a press conference this afternoon that reducing U.S. dependence on foreign energy sources would be among key points in Bush's address. Bush spent time today rehearsing his speech, which was in its 23rd draft as of early this morning, McClellan said. In anticipation of Bush's remarks, the Nuclear Energy Institute today released a "Top 10" list of reasons nuclear power is important to the U.S.' energy strategy. Several environmental and antinuclear groups announced they would hold a teleconference on Wednesday to discuss their views on Bush's speech. ------------