May 24 (Reuters) – Noble Corp, owner of the third-largest offshore drilling fleet, is budgeting for capital spending to grow by about a fifth next year, unless it decides to build a new rig to add to the 11 now in the works.

Based on Noble’s current program that includes five new deepwater drillships and six shallow-water jackups, Chief Financial Officer James MacLennan gave a projection for 2013 capital expenditure of $2.3 billion, up from $1.9 billion this year.

But Chief Executive David Williams said another new rig could be announced later this year, as the company tries to lock down deals for the eight uncontracted rigs already on the way.

Williams said new rigs were especially attractive now due to a combination of stronger demand, a general capital shortage, and the 2008 financial crisis driving out speculative rig builders who could otherwise flood the market.

“I don’t think I’ve ever seen stars lined up the way they are now,” he said at a presentation to analysts in Houston on Thursday, which was available via webcast.

In addition, the contractors’ bargaining power had increased with the rig builders because of macroeconomic factors. “The shipyards don’t have the backlog – the shipping business is in the toilet,” Williams said.

He expects a few of the five jackups and three drillships now without contracts to secure commitments this year.

HOUSTON (Reuters) – Chevron Phillips Chemical Co, one of the top five U.S. chemical companies by volume, believes the oversupply of natural gas liquids (NGLs)that feed its U.S. plants is unlikely to be eliminated for another four or five years.

The joint venture of Chevron Corp (CVX.N: Quote, Profile, Research, Stock Buzz) and Phillips 66 Co (PSX.N: Quote, Profile, Research, Stock Buzz) is spending $5 billion on new ethylene facilities in Texas as part of a broader industry build-out that should soak up demand for NGLs such as ethane.

Chevron Phillips Chemical, which was formed in 2000 and employs about 4,700 people, is the world’s fourth-largest producer of high density polyethylene, used to make everything from food containers to plastic furniture.

The company found out last month its application with the U.S. Environmental Protection Agency for two polyethylene plants was complete, and the EPA now has a year to consider it, Chief Executive Peter Cella said on Thursday. If approved, the chemical company could seek funding approval from its own board by the end of next year, with an eye on starting up in 2017.

The plants will be fed by a new “cracker” outside Houston that converts ethane to ethylene, and all together the three sites will be a $5 billion investment that adds to Chevron Phillips Chemical’s $8.5 billion in assets, Cella said.

“The supply source has gotten ahead of the demand need. I think we’re doing our share to elevate the capacity to consume,” he told the Reuters Global Energy & Environment Summit in Houston.

“You can drill a well in a month or two, and it takes us five years to build a new cracker, so you’ve got this mismatch in timelines.”

HOUSTON (Reuters) – Chevron Phillips Chemical Co, one of the top five U.S. chemical companies by volume, believes the oversupply of natural gas liquids (NGLs)that feed its U.S. plants is unlikely to be eliminated for another four or five years.

The joint venture of Chevron Corp (CVX.N: Quote, Profile, Research, Stock Buzz) and Phillips 66 Co (PSX.N: Quote, Profile, Research, Stock Buzz) is spending $5 billion on new ethylene facilities in Texas as part of a broader industry build-out that should soak up demand for NGLs such as ethane.

Chevron Phillips Chemical, which was formed in 2000 and employs about 4,700 people, is the world’s fourth-largest producer of high density polyethylene, used to make everything from food containers to plastic furniture.

The company found out last month its application with the U.S. Environmental Protection Agency for two polyethylene plants was complete, and the EPA now has a year to consider it, Chief Executive Peter Cella said on Thursday. If approved, the chemical company could seek funding approval from its own board by the end of next year, with an eye on starting up in 2017.

The plants will be fed by a new “cracker” outside Houston that converts ethane to ethylene, and all together the three sites will be a $5 billion investment that adds to Chevron Phillips Chemical’s $8.5 billion in assets, Cella said.

“The supply source has gotten ahead of the demand need. I think we’re doing our share to elevate the capacity to consume,” he told the Reuters Global Energy & Environment Summit in Houston.

“You can drill a well in a month or two, and it takes us five years to build a new cracker, so you’ve got this mismatch in timelines.”

By Braden Reddall

(Reuters) – Martin Koffel, head of engineering company URS Corp (URS.N: Quote, Profile, Research, Stock Buzz), feels the United States is poised for a manufacturing renaissance, driven at least in part by demand among the developing world’s burgeoning consumer class.

“There is once again a cachet about American-made products,” the CEO said in an interview on Tuesday. “In some industries at some levels, there’s going to be a Made in America advantage.”

Koffel, an Australian who has run URS for more than two decades, noted that the labor cost advantage between the United States and developing countries had shrunk as wages in the country have stagnated and inflation has been low, while at the same time U.S. labor productivity has surged.

Koffel’s conversations with clients indicate that general manufacturers and makers of heavy machinery are gearing up to expand at home again to feed foreign demand, and so he was trying to position URS to benefit by hiring the right people.

A large part of URS revenue comes from the U.S. government, including defense and nuclear work, and while federal spending is likely to fall, Koffel expects those two areas to remain fairly stable. “You can not legislate for an extension of a half-life of an isotope,” he said.

URS just completed its $1.24 billion acquisition of Canadian oilfield services company Flint Energy Services on Monday, which Koffel said satisfied a long-standing ambition to increase its interest in the energy sector.

HOUSTON/NEW YORK (Reuters) – IBM thinks it can make geologists and engineers more effective at mining the fast-growing wealth of data on everything from oil reservoirs to refineries to help them find, extract and process oil.

The computer services company has spent the past three years building a team of 5,000 consultants, scattered around major oil basins worldwide, to help companies tackle the data explosion.

Just having a lot of data is not enough: As with crude, data must be refined and then shipped out to the people who can use it: those who make drilling decisions with millions of dollars on the line.

“Data management: we see a lot of effort, and by effort I mean investment, in that space,” David Womack, IBM’s director of strategy and business development for chemicals, petroleum and industrial products, told the Reuters Global Energy & Environment Summit on Tuesday.

“They’ll give you these big data sets, and being able to manage and manipulate that is a non-trivial act,” he added.

Chevron Corp has estimated its network manages 1.5 terabytes a day, or equivalent to about 1.5 million books, and says its computers store more information than the Library of Congress.

Much of that is due to the development in recent years of three-dimensional oil reservoir imaging, which is far more data-intensive than 2-D seismic imaging. Even on the other end of the oil value chain, refiners deploy thousands of small instruments to monitor various parts of their plants.

HOUSTON (Reuters) – Engineering company Fluor Corp (FLR.N: Quote, Profile, Research, Stock Buzz) sees no signs that a shale gas-driven boom in U.S. petrochemicals will slow down, said CEO David Seaton, who now believes many of the nine proposed U.S. plants under study will get built.

Hiring enough workers to do it will be the trick. A global wave of capital investment was already leading to early signs of labor, equipment and raw material shortages, as companies gear up for stronger economic growth by mid-decade, Seaton said.

“I don’t think we’re returning to how hot it was in the 2007-08 time frame, but I do see escalation in the cost of commodities and fabricated equipment as we end this year, as we get into the next,” Seaton told the Reuters Global Energy & Environment Summit on Monday.

Another pinch point will be construction labor, already spotted in Australia and soon to emerge in the Canadian oil sands and potentially the United States. “The ‘craft’ side’s going to be a problem,” he said.

In the U.S. chemical market, Seaton identified something in the order of nine plants under discussion, driven by cheap shale gas as a feedstock. “Going back probably six months, I was pretty skeptical that more than one or two would be built,” he said, but he now saw four or five based on early Fluor studies.

Yet on the question of U.S. liquefied natural gas exports, Seaton ran against the grain of current industry chatter. He believed a gas-to-liquids plant probably made more sense because LNG export economics could be severely altered by a doubling in U.S. natural gas prices from current levels.

“When you get up to the $5-6 (per million British thermal units) range, is it competitive with base-load plants in Qatar, Australia and the like?” Seaton wondered.

By Braden Reddall and Ben Berkowitz

(Reuters) – From water worries to well blowouts, the inherent risks of oil and gas extraction are often played down by those in the business. But another group of profit-seekers has every reason to keep a close eye on dangers for drillers: their insurers.

Underwriters now face a politically charged problem in the perceived threats to water supplies of hydraulic fracturing.

Amid litigation and federal probes, insurance companies are left scratching their heads over how to price the risk of the oil and gas production technique now better known as fracking.

The lawsuits and tests so far provide little help. One much-cited case involved Cabot Oil & Gas Co, which settled in late 2010 for $4.1 million with residents of the small Pennsylvania town of Dimock over methane found in their water.

Then on Friday, the Environmental Protection Agency said it had completed testing water at 61 homes in Dimock and found the drinking water was safe to consume.

Insurers may get more clarity once EPA releases initial findings, due later this year, of its five-state investigation into the risks to drinking water of fracking.

May 3 (Reuters) – First Solar posted a surprise quarterly loss on Thursday, but raised its full-year profit outlook as it drives down production costs for its solar panels, while peer SunPower Corp slightly beat Wall Street forecasts.

The shares of the two largest U.S.-based solar makers were nearly flat in post market trading.

Solar makers have seen profit margins evaporate over the last year as prices for the modules that turn sunlight into electricity have fallen sharply amid a global supply glut and declining government subsidies in Europe, the biggest market.

First Solar, the industry’s lowest cost solar panel maker, also said it named James Hughes as its new chief executive to replace Rob Gillette, who was ousted by the company in October last year.

Hughes joined First Solar in March as chief commercial officer and will take over from Chairman Mike Ahearn, who had been serving as the interim CEO.

One analyst said Hughes, who had been the CEO of AEI, a Houston-based company that operates power plants and natural gas projects in emerging markets, appeared to be a good fit for First Solar, which is hoping to increase sales in several developing economies.

“He’s the right person to take the company in that direction,” said Edwin Mok, an analyst with Needham & Co.

May 3 (Reuters) – Transocean Ltd topped profit expectations for the first quarter as costs fell on the timing of maintenance and project spending, but it expects those costs to rise sharply this quarter before returning to normal later this year.

Transocean shares rose as much as 4 percent early on Thursday. They were up 1.3 percent at $50.60 in midday trade.

Greg Cauthen, chief financial officer of the owner of the world’s largest offshore drilling fleet, stuck with his 2012 operating and maintenance cost estimate of between $6.15 billion and $6.35 billion.

“We expect operating and maintenance costs in the third and fourth quarter to be higher than the first quarter but significantly lower than the second quarter, as our expected level of shipyard activity decreases in the second half of the year,” Cauthen told analysts on a conference call.

Excluding one-time items, Transocean earned a first-quarter profit of 68 cents per share, compared with the average 33 cents per share expected by analysts on Thomson Reuters I/B/E/S.

The outperformance was driven almost entirely by the lower costs in the quarter, analysts said.

On the other hand, nearest rival Ensco Plc reported a first-quarter profit just short of expectations, and said the effects of rig downtime had been a particular problem that it expected to improve.

By Matt Daily and Braden Reddall

(Reuters) – Valero Energy Corp (VLO.N: Quote, Profile, Research, Stock Buzz) made a quarterly loss due to smaller discounts on the crude it processes and charges for shutting its Aruba refinery, but the underlying performance was better than expected and its shares rose 1.7 percent.

The U.S. refiner said it continued to benefit from strong exports, even as weak demand at home cut its income per barrel processed by more than half compared with a year earlier, to $2.11.

“These export volumes have helped to offset weak domestic demand and contributed to higher operating rates at our refineries,” Chief Executive Bill Klesse said in a statement.

Valero said the combined throughput of its 14 refineries was expected to be between 92 percent and 95 percent of its 2.765 million barrels in total capacity in the second quarter.

The net loss for the first quarter was $432 million, or 78 cents per share, versus a profit of $104 million, or 18 cents per share, a year earlier. Excluding one-time items, Valero earned 31 cents per share, 2 cents above analysts’ average forecast, according to Thomson Reuters I/B/E/S.

Refining volumes in the quarter climbed 449,000 barrels per day to 2.56 million bpd due to the acquisitions of the Pembroke and Meraux refineries, the company said.