Recent rates have led to low earnings, meaning not much profit has been made. However, Johnson theorizes that if fundamentals continue to improve, and margins continue to widen, then the theoretical upside will be good for refiners, consumers and investors.Company news Recently, junior oil exploration company Taipan Resources (TSXV:TPN) signed a farm-out agreement with Premier Oil (LSE:PMO) for 55 percent of Taipan's licence interests in Block 2B, onshore Kenya. Block 2B is located in the Southern Anza basin; it contains the Pearl prospect, which holds an estimated gross mean prospective resource of 126 million barrels of oil in the initial well. As per the terms of the agreement, "Premier will pay Lion Petroleum ... a wholly-owned Kenyan-based subsidiary of Taipan, back costs of US$ 1 million. Premier will also pay Taipan's working interest share of the cost of drilling and testing the Pearl prospect and future costs on Block 2B up to a cap of US$ 13.275 million. Premier has the option to assume operatorship of any future development on the block." Africa Oil (TSXV:AOI) is holding a US$450-million brokered private placement of an aggregate of 56,505,217 common shares at a price of SEK 51.75 (C$8.25) per share. After completing its first exploration well off the coast of Sierra Leone, Russia's Lukoil has confirmed the presence of high-quality oil. The Russian government congratulated Lukoil on the find, saying that a full appraisal of the area's oil potential will be done by the end of the year, according toaThe Associated Press. Lukoil also has a 25-percent state in another block located nearby in Sierra Leone. Officials are looking to begin producing oil by 2017. A 35-year production-sharing contract for the massive Libre pre-salt oil discovery in the Santos Basin, offshore Brazil, was awarded to a consortium of five companies yesterday. The consortium includes Royal Dutch Shell (NYSE:RDS.B), Petrobras (NYSE:PZE), Total (NYSE:TOT), CNPC and CNOOC (NYSE:CEO). Libra has a recoverable resource of between 8 and 12 billion barrels of oil, as estimated by Brazil's regulator,aAgncia Nacional do Petrleo.
"The Libra oil discovery inaBrazilais one of the largest deep water oil accumulations in the world. We look forward to applying Shell's global deep water experience and technology, to support the profitable development of this exciting opportunity," said Peter Voser, CEO of Royal Dutch Shell, in a statement to investors.The company's press release notes that Shell holds 20 percent of the consortium, while Petrobras holds 40 percent and is the operator. Total holds 20 percent and CNPC and CNOOC each hold 10 percent. Securities Disclosure: I, Vivien Diniz, hold no investment interest in nay of the companies mentioned. Oil Prices Drop Below $100 per Barrel from Oil Investing News