By Jason Simpkins Managing Editor Money Morning

Exxon Mobil Corp. (NYSE: XOM) and Royal Dutch Shell PLC (NYSE ADR: RDS.A, RDS.B) on Thursday won the right to develop Iraq’s West Qurna-1 oilfield.

The agreement is the third such deal this year, which means Iraqi oil production could increase at a faster pace than previously expected and potentially lead to a drop in oil prices.

Iraqi officials earlier this week finalized an agreement with BP PLC (NYSE ADR: BP) and China National Petroleum Corp. (CNPC). Policymakers also reached an initial agreement with a consortium led by Italy’s Eni SpA (NYSE ADR: E) that will develop the Zubair oil field.

The latest deal gives Exxon and Shell the right to increase production at Iraq’s West Qurna-1 oilfield, which is believed to hold about 8.7 billion barrels of oil reserves. The field is already producing

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Pioneer Natural Resources Company (PXD) reported its third quarter results of 2 cents per share, well below than the Zacks Consensus Estimate of 6 cents and year-earlier quarter earnings of 91 cents. Before adjusting one-time items, loss per share was 6 cents.  Despite the increased production volumes and lower production expenses, earnings were down due primarily to weak realized prices. Revenue for the quarter was $410.1 million, down nearly 32% from the year-earlier level.  Total production for the quarter averaged approximately 113 thousand barrels oil equivalent per day (MBOE/d), up 2% year over year, reflecting the strong performance of Pioneer’s low-decline assets. Oil production averaged at 31.7 thousand barrels per day (MBbl/d), up approximately 7% year over year. Natural gas liquids production slightly decreased to 18.6 MBbl/d. Natural gas production also modestly increased to 374.2 MMcf/d.  On an oil equivalent basis, average realized price was ...

Natural gas producer Ultra Petroleum Corporation’s (UPL) third quarter results came in better than expected, primarily due to increased production. Earnings per share, excluding non-cash mark-to-market charge, came in at 57 cents, topping the Zacks Consensus Estimate by 11.8%. However, in line with other onshore natural gas-focused companies – Devon Energy Corp. (DVN), XTO Energy Inc. (XTO), Anadarko Petroleum Corp. (APC) and Chesapeake Energy Corp. (CHK) – earnings and revenue comparisons with the year-earlier period were quite weak, severely hampered by the slump in commodity prices. Ultra’s adjusted earnings per share fell 26.9% (from 78 cents to 57 cents), while operating revenues declined 47.9% to $155.2 million. Record Quarterly Production Production during the quarter increased 26.5% year over year and 3.2% sequentially to a record 45.9 billion cubic feet equivalent (Bcfe), reflecting the company’s successful drilling activities. Natural gas volumes jumper ...

Natural gas producer XTO Energy’s (XTO) third quarter results came in better than expected, primarily due to rise in production volumes. Earnings per share, excluding non-cash derivative fair value loss, came in at 87 cents, ahead of the Zacks Consensus Estimate of 84 cents.   XTO’s adjusted earnings per share fell 11.2% year over year, reflecting lower realized natural gas prices. However, revenues were up 7.7% to $2.3 billion, mainly on the back of the company’s attractive hedges. During the quarter, operating income was down 5.2% year over year to $919 million, but cash flow from operations was up 2.8% to $1.6 billion.   Volume Gains Continue   Production during the quarter increased 23.4% year over year and 1.9% sequentially to a record 2.9 billion cubic feet equivalent (Bcfe) per day. Average daily gas production increased 24.2% year over year to 2.4 billion cubic feet (Bcf), daily oil ...

From Robert Amsterdam's latest in the Huffington Post:

But it is clear to those of us who have watched and listened to Khodorkovsky over these years that his beliefs, spirit and convictions have only deepened. When he first became a political prisoner, he was recognized as a symbol of Russia being on the wrong track: the disappearance of rule of law, corporate raiding and state theft, authoritarian drift, and the Kremlin's first taste of using stolen assets as an energy weapon. Today, after six long years of injustice, he is emerging as an important political voice and a sign of Russian moral conscience.

These statements have been building over past months, most recently highlighted by an article he

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Chesapeake Energy Corporation (CHK) has modestly raised its 2009 and 2010 production outlook and introduced its 2011 production guidance. The company also expects to spend $3.15 billion to $3.35 billion on drilling this year, up from its August forecast of $3 billion to $3.2 billion.  The company is expecting production of 12 million barrels of oil (MMbbl), 815–825 billion cubic feet (Bcf) of natural gas and total production of 885–895 billion cubic feet equivalent (Bcfe) during 2009.  For 2010, Chesapeake expects oil production to be 12.5 MMbbl, natural gas generation of 882–902 Bcf and total output to be 957–977 Bcfe. The company has provided its initial projections for 2011. It expects 13 MMbbl of oil, 1,007–1,027 Bcf of natural gas and 1,085–1,105 Bcfe of total production.  For 2009, the company expects year over year production growth to be in the range of 5%–6% (up from ...

Kafkaesque. The former Russian oil tycoon, who stood up to Putin, is back before his judges. Here is the story. [The following is a translation of an article published in the French publication Le Point.]

Le Point, October 15, 2009

Accused Khodorkovsky, Stand Up!

From our special envoy Marc Nexon

He stands up, opens his spiral notebook and pulls out 3 sheets of paper he has scribbled with his fine handwriting. He pats the microphone installed in his glass cage. "Can you hear me?" he asks, addressing the judge. Then he starts with a clear voice: "I know that in his eyes I embody absolute evil, but I would like to ask quietly a few questions to the witness of the prosecution..."

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The challenges for private oil companies to increase oil production are pretty daunting.

ExxonMobil (XOM) has been producing a little over 2.4 million barrels of oil a day for the last year and a half, its lowest rate of production over the last decade. The dark blue line in the figure below shows the company's production each year since 1999. Four years ago, Stuart Staniford noted that ExxonMobil's 2001 annual report predicted 3% annual growth in production between 2001 and 2007. That projection appears as the red line in the graph below; didn't quite come out as planned. Stuart's theory was that the company correctly predicted the contribution of its new discoveries, but underestimated the declining production rates from mature fields.

ExxonMobil again predicted in 2006 that it could achieve 3% annual growth over 2006-2011. I've shown that forecast as the lighter blue line

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Gazprom is set to bid for gas and oil fields in Iraq with Turkey's state-run oil company Turkish Petroleum Corporation.  Rosneft, Lukoil and Gazprom Neft will also participate in bids.  Venezuela's Science and Technology Minister Jesse Chacon has asserted that it is Russia that is helping the country search for uranium, not Iran.  Iran's Oil Ministry has apparently said that the country needs $19 billion to finish uncompleted natural gas projects.  Gazprom Neft has filed a request to the anti-trust watchdog to buy 100% of oil company Sibir Energy.  Kazakhstan, which hopes to increase two-fold its oil production over the next ten years, is in talks with Azerbaijan to establish new routes for delivering extra crude volumes to the Black Sea and is even considering a new pipeline.  The Moscow Times reports that Chinese investors are negotiating ...

Sep. 15, 2009 (Business Wire) — Cobra Oil & Gas Company (OTCBB:CGCA) (hereafter “Cobra”) notifies that British Petroleum announced the discovery on September 2, 2009, of a giant oilfield in the US part of the Gulf of Mexico that shows new life for US domestic oil production.

The Tiber field, located about 250 miles south-east of Houston, is one of the largest discoveries of the past decade. It may hold some 3bn barrels of oil. The Tiber field was discovered by the deepest oil well ever drilled, reaching 28,000 ft below sea level.

The Tiber field discovery adds to the Kaskida field found in 2006 with similar potential reserves.

“The technologies being used to produce finds this size and at this depth show the progress being made by commercial means of exploration,” stated Max Pozzoni, President of Cobra. “What is happening now in domestic areas such as the Gulf of Mexico

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