U.S. considers oil market intervention

Section:

White House Considers Tapping Oil Reserves

By Jackie Frank
Reuters
Sunday, March 6, 2011

http://www.reuters.com/article/2011/03/06/us-usa-energy-reserves-idUSTRE...

WASHINGTON -- White House Chief of Staff William Daley said on Sunday the Obama administration was considering tapping into the U.S. strategic oil reserve as a way to help ease soaring oil prices.

Speaking on NBC television's "Meet the Press," Daley said: "We are looking at the options. The issue of the reserves is one we are considering. It is something that only is done -- and has been done -- in very rare occasions. There's a bunch of factors that have to be looked at. And it is just not the price."

"All matters have to be on the table when you see the difficulty coming out of this economic crisis we're in and the fragility," Daley added.

Congress has pressured the Obama administration to look to the emergency oil supply to ease consumers' fears over rising gasoline prices, which are threatening again to top $4 per gallon at U.S. gas stations.

... Dispatch continues below ...



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Prophecy Resource Spins Off Platinum/Palladium Venture:
World-Class PGM Deposit in Yukon

Company Press Release, January 18, 2011

VANCOUVER, British Columbia -- Prophecy Resource Corp. (TSX-V:PCY)and Pacific Coast Nickel Corp. announce that they have agreed that PCNC will acquire Prophecy's Nickel PGM projects by issuing common shares to Prophecy.

PCNC will acquire the Wellgreen PGM Ni-Cu and Lynn Lake nickel projects in the Yukon Territory and Manitoba respectively by issuing up to 550 million common shares of PCNC to Prophecy. PCNC has 55.7 million shares outstanding.

Following the transaction:

-- Prophecy will own approximately 90 percent of PCNC.

-- PCNC will consolidate its share capital on a 10 old for one new basis.

-- Prophecy will change its name to Prophecy Coal Corp. and PCNC will be renamed Prophecy Platinum Corp.

-- Prophecy intends to distribute half of its PCNC shares to shareholders pro-rata in accordance with their holdings.

Based on the closing price of the common shares of PCNC on January 17, $0.195 per share, the gross value of the transaction is $107,250,000.

For the complete announcement, please visit:

http://prophecyresource.com/news_2011_jan18.php



Higher oil prices could undermine the fragile U.S. economic recovery and politically damage President Barack Obama as he moves toward his 2012 re-election bid.

While the White House has said governments around the world had options, including oil reserves, that could be used to prevent an inflationary price spiral due to oil supply disruptions, none have taken the rare step of tapping into their oil reserves.

U.S. oil prices jumped on Friday to more than $3 a barrel to $105.17, their highest level since September 2008, as fighting in Libya worsened and protests in the Middle East intensified.

The International Energy Agency said the revolt in Africa's third-largest producer had blocked about 60 percent of Libya's 1.6 million bpd (barrels per day) oil output, largely due to the flight of thousands of foreign oil workers.

On Thursday, U.S. Treasury Secretary Timothy Geithner played down the risks to the oil supply from political disturbances in the oil-rich Middle East and North Africa in testimony before a congressional panel.

He said there was "considerable" spare oil production capacity around the world and "substantial" reserves on hand.

"If necessary, those reserves could be mobilized to help mitigate the effect of a severe, sustained supply disruption," Geithner told the U.S. Senate Foreign Relations Committee.

Geithner said high food and oil prices were causing hardships in many parts of the world. But he said Americans were feeling less impact.

There has been support among Senate Democrats for tapping America's emergency oil supply to cool gasoline prices.

Senator Jay Rockefeller urged Obama on Thursday to allow a "limited draw-down" from the oil reserves, to "protect our national security by preventing or reducing the adverse impact of an oil shortage.

But Republican Senator Lamar Alexander, speaking on CNN's "State of the Union" on Sunday, said he would not support the oil reserve drawdown.

On Wednesday, U.S. Energy Secretary Steven Chu ruled out releasing oil from the reserve, saying ramped-up oil production in Saudi Arabia should lower the crude price.

"That's going to mitigate the price increase," he told reporters. "We're hoping market forces will take care of this."

Tapping the Strategic Petroleum Reserve, created in the mid-1970s after the Arab oil embargo, is a relatively rare event. It has been U.S. policy to turn to the emergency supply only when faced with a major supply disruption.

It was last done in 2005 following Hurricane Katrina, helping to drive oil prices down by about 9 percent.

British finance minister George Osborne on Friday signaled he would cut the country's fuel tax to counter soaring oil prices. A one penny-per-liter rise in the fuel duty planned by the previous Labour government was due to take effect in April.

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Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit, Extending the Mineralization of the Southwest Vein on the Property

Company Press Release, October 27, 2010

VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include:

-- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres.

-- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres.

-- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre.

Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface.

"The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest."

For the company's full press release, please visit:

http://sonaresources.com/_resources/news/SONA_NR19_2010.pdf