More Reuters, 03.24.03, 4:24 AM ET

SINGAPORE, March 24 (Reuters) - Chinese state oil trader Sinochem is close to finalising its first overseas oil and gas acquisition worth up to $105 million with key gas assets in the United Arab Emirates, a senior Sinochem official said on Monday. Beijing-based Sinochem has agreed to take over Atlantis, a subsidiary of Norwegian oilfield services group Petroleum Geo-Services. "We've completed the first-phase closure of the deal earlier this month -- the legal procedures and the joint account books," said the official from Beijing. Sinochem was waiting for Atlantis' existing partners, including state interests in the UAE and Oman, to decide on their pre-emptive rights before finalising the transfer of the assets, the official said. The deal is Sinochem's first major overseas oil and gas investment although it is one of the smallest among a flurry of acquisitions by state oil companies as China seeks to reduce its dependence on Middle East crude. State firms CNPC, Sinopec, CNOOC Ltd and PetroChina have ploughed more than $4 billion in oil and gas reserves in Indonesia, Australia, Sudan, Kazakhstan, Venezuela and Azerbaijian. The Sinochem official said the centerpiece of the Atlantis deal would be gas assets in the UAE with estimated recoverable reserves of 310 billion cubic feet (bcf). The deal also includes gas exploration contracts in Oman and oil exploration and production contracts in Tunisia. "The final value of the deal, if it's $105 million or some other figure, will depend on what is left after the execution of pre-emptive rights by existing partners," said the official, without giving details. PGS said in late January that it had sold Atlantis to Sinochem for up to $105 million, a sharply lower value than an earlier estimate of over $200 million. PGS did not give the reason for the almost halving of the price. Once China's monopoly oil trader which has since seen its domestic market increasingly squeezed by competition, Sinochem wants to become an independent exploration and production company with a focus on assets outside of China. In early 2002 Sinochem set up a separate arm for exploration and production looking for small and medium-sized oil and gas fields valued at $100-200 million.

Source Monday March 24, 3:45 PM Contact Us: Singapore 65-6415-4150

0745 GMT [Dow Jones] "Paltry" 0.4% on-year rise in February CPI reflects post-Lunar New Year adjustment in food prices, says JPMorgan Chase Bank. Seasonally-adjusted, CPI down 0.4% on-month, first fall in 6 months, with little apparent impact from 1 percentage point rise in GST (started January 1), underscoring weak household consumption trend. Looking ahead, JPMorgan expects inflation environment to stay benign. (NIA)

0616 GMT [Dow Jones] "Euphoria phenomenon" that's lifted USD since start of offensive vs Iraq unlikely to last long even if U.S. wins decisively, says head trader at foreign brokerage in Tokyo; "People think a quick U.S. victory is somehow going to rescue the (U.S.) economy, but we don't believe that story." Looks for USD to fall back to early March levels vs JPY and EUR in medium term as markets refocus on shaky U.S. fundamentals. (JOS)

0540 GMT [Dow Jones] Singapore IRS curve steepens mildly as long end rises amid continued sell-off in local government bonds; 2- to 10-year spread now at 146 bps vs 144 Friday. But traders caution scope for further steepening may be limited as Iraq war appears more difficult than earlier thought; a prolonged war likely to spark return of risk-aversion, favoring safe-haven instruments. Spread could be capped below 150 bps for time being. (SHG)

0533 GMT [Dow Jones] SGD IRS up across board tracking fall in local bonds, lower U.S. Treasurys Friday; paying focused on long end, with gains in short end limited due to lingering concerns over weak global economy. Traders say long end also soon could be under pressure if Iraq war gets tougher, as investors may resume bond-buying after recent liquidation of war premiums. 2-year offer up 1 bp at 1.09%, 5-year up 3 bps at 1.81%, 10-year up 3 bps at 2.55%. (SHG)

0510 GMT [Dow Jones] Singapore inflation still benign, but February data also show evidence of lackluster domestic consumption: CPI +0.4% on-year after 0.9% rise in January, but down 0.2% on-month. Decline mainly due to cheaper prices for food and clothes after spike ahead of Feb. 1-2 Lunar New Year holiday. Data secondary in nature and not moving markets. (SHG)

0453 GMT [Dow Jones] STI snaps four-day run-up, down 1.2% at 1310.16 midday near 1308.41 intraday low. Trader says investors shrugging off Wall Street's strong close Friday, taking profit on fears of drawn-out war in Iraq; "from the looks of it, the easy wins have been collected under the U.S.'s belt. Going forward, it's going to be difficult." Volume unusually high with 244 million shares traded. Banks all hit, while SIA down 2%, NOL off 1% on worries oil prices will renew gains. New listing Ocean Sky (O05) one of few bright sparks, up 19.6% at 27.50 Singapore cents. (ALP)

0433 GMT [Dow Jones] SGX futures falling in tandem with spot market, as going gets rougher in Iraq; SiMSCI March futures down 4 points at 160.9 on 1658 contracts, while STI March futures down 20 points at 1310 on 4 contracts. Any weakness in European markets later today may hurt sentiment further. Redeeming feature is high volume of contracts traded, suggesting traders prefer to use futures to trade market, as blue chips turn volatile. (EYG)

0413 GMT [Dow Jones] Despite fall in oil prices on hopes of quick end to war, Goldman Sachs believes prices will remain high in medium term as Iraq wasn't only reason for prices running up ahead of start of war last week. Disruptions in Venezuelan oil production, cold winter in northern hemisphere and low inventories of oil products globally are also contributing factors; "Hence, oil prices should remain a tangible source of downside risk (for) Asia," GS says. (NIM)

0331 GMT [Dow Jones] May Nymex crude may have been oversold on speculation of quick U.S.-led victory in Iraq, says HSBC oil and gas analyst Gordon Kwan; "prices could retest $30 a barrel again this week unless the military operations were extremely smooth going into Baghdad." Deteriorating situation in Nigeria, off-peak production in Venezuela and some lost output in Iraq, Kuwait to help prop up prices. (ILK)

0155 GMT [Dow Jones] MSNBC TV quotes unnamed U.S. military officials as saying special operations teams and units of CIA are in Baghdad; officials hint recent explosions there (with no air raid sirens or indications of U.S. aircraft overhead) may have been work of Iraqi resistance groups, possibly working with U.S. forces. Unclear if this is just U.S. disinformation, but it may help sustain markets' hopes for quick U.S. victory. (AXT)

0144 GMT [Dow Jones] USD/SGD drops back below 1.7700, now at 1.7697 after players take profit at early high of 1.7720, dealers say; USD/SGD likely to stay heavy, but selling momentum in local trade not consistent, or strong, as players continue to watch developments on war front, dealers say. 1.7680-1.7720 range to hold for now. (NIA)

0141 GMT [Dow Jones] U.S. officials say U.S. troops have found suspected "chemical factory" in south Iraq, but don't confirm whether it's actually believed to be chemical weapons facility as Fox TV reported earlier. If U.S. can prove Iraq had major WMD projects, it will greatly help to justify U.S. decision to go to war in court of world opinion, and reduce negative geopolitical fallout from war - so positive for USD and equities. (AXT)

0123 GMT [Dow Jones] Fund managers yet to increase risk-taking, with net USD, EUR portfolio flows confirming recent USD recovery driven more by unwinding of speculative positions than by active investor buying, says JP Morgan. Absence of investor buying in USD-rally due to uncertainty over aftermath of war, U.S. economic fundamentals; "this lack of investor follow-through is another reason to assume that the pace of dollar gains will slow." (MXT)

0119 GMT [Dow Jones] Singapore government bonds slipping in early trade, following fall in U.S. Treasurys Friday, but concerns Iraq war may not end as soon as earlier hoped for may stem falls, dealers say; 15-year yield now at 2.76%, 10-year yield at 2.36%, each up 2 bps. Interest rate swaps also up, with 10-year offer +2 bps at 2.54%, 5-year +2 bps at 1.80%. (NIA)

0044 GMT [Dow Jones] USD/SGD up at 1.7708 vs 1.7655 late Friday in Asia, carried higher by broad USD gains; but while pair expected to rise as far as 1.7720, it's looking heavy now and may well come off around that level. Players still watching Iraq war progress, market liquidity still tight, likely to result in erratic moves, dealers say; tip 1.7680-1.7720 range. (NIA)

0039 GMT [Dow Jones] STI expected to extend rally after Wall Street's surge Friday, led by banks and blue chips on hopes Iraq war will soon be over as allied troops continue advance to Baghdad; but sliding U.S. stock futures on concerns of drawn-out war may damp sentiment for techs like Chartered and ST Assembly. "How long the rally lasts will depend on how much people believe what they're seeing on TV," says trader, noting both U.S. and Iraqi propaganda in full gear. Resistance may be at 1350. (EYG)

0019 GMT [Dow Jones] TECHNICAL ANALYSIS: At 1.7705, USD/SGD's hourly oscillators have just sent sell signal implying pullback in next couple of days (bearish crossover by MACD, negative momentum divergence); USD/SGD will retest minor underlying support at 1.7680, and likely test strong underlying support at 1.7614 (February peak). Note any drop below 1.7631 would trigger double top targeting 1.7531. Immediate, minor underlying resistance at 1.7720; good underlying resistance at 1.7781 (mid-October trough). (AXT)

AOL unit sees silver lining in Argentina Posted on Mon, Mar. 24, 2003 BEA GARCIA bgarcia@herald.com

AOL EXEC: Charles Herington is president and chief executive of America Online Latin America. AOL is consolidating most of its call center operations from Mexico and Puerto Rico in Argentina. CHUCK KENNEDY/KRT FILE

Argentina's recent economic turmoil may have frightened away some investors, but others see opportunity there.

One is AOL Latin America, which will announce this morning that it's consolidating most of its call center operations from Mexico and Puerto Rico in a regional center in Argentina. The move takes advantage of lower labor and operating costs as well as a highly educated, technically savvy and Spanish-speaking workforce. The company will be adding about 200 employees in the next few weeks.

In a concurrent move, AOL Latin America, which is a joint venture between America Online and Venezuela's Cisneros Group of Companies, will concentrate its content operations in Mexico where it already has a strong team working in that area. The group will be producing generic Spanish-language content that can be used in the company's Argentine, Mexican and Puerto Rican portals.

AOL Latin America moved Martin Moreyra, who has been the director of content development in Argentina, to Mexico to work with the consolidated group.

AOL Latin America also operates in Brazil. Banco Itau, one of Brazil's largest banks, holds a minority stake in the Internet service provider and portal.

AOL Latin America is the front end of an emerging trend to use Argentina as a central location for regional operations.

A major U.S. multinational computer company already has established a regional call center in Argentina and several other companies have similar plans, sources said.

Charles Herington, AOL Latin America's president and CEO, says these two consolidating actions take advantage of the region's economic situation and meet objectives that have been driving the company in the past year: Cost reduction and more efficient operations.

After four years in business, the Fort Lauderdale-based company is still striving to reach profitability.

Losses from mid-1999 through year-end 2002 totaled $791.4 million. To the company's credit, however, it has been narrowing its losses significantly in the past 10 consecutive quarters.

AOL Latin America ended 2002 with $75.5 million in cash and said that money should carry it through the first quarter of 2004.

David Joyce, a stock analyst who follows the company for Guzman & Co. in Miami, estimates that AOL Latin America will have to borrow only $30 million in the second quarter of 2004 if it can manage to keep its costs ``more or less flat.''

That's why these latest initiatives are key, says Herington.

In 2002, the company saw its revenue grow 8.5 percent to $72.1 million. Its net losses shrank considerably, but red ink remains on the bottom line.

AOL Latin America's net loss fell to $180.6 million, or $2.69 a share, from $307.3 million or $4.66 per share.

The other major objective for the company is targeting high-value members, which means getting subscribers who are willing to stay with the service after the initial free trial period is over.

The company's shares closed Friday at 45 cents, up 5 cents for the day and 8 cents for the week.

MORE HISPANICS GOING ONLINE

Often, the beauty of statistics is that you can slice 'em and dice 'em any way you want -- and make them suit your point of view.

Last week, comScore Networks, the New York-based firm that tracks Internet usage, released highly anticipated data on Spanish-language Internet portals.

It provided a good view of where the top portals stand after nearly two years of transition.

Many of these companies made headlines in 1999 and 2000; all of them have been through significant downsizing and management, ownership and operational changes since then.

But the report does show the Internet has a growing number of Spanish-language users, and U.S. Hispanic are the fastest growing group. That was good news for Yahoo en Español, StarMedia, Terra.com, Univision.com, and MSN Group, which includes YupiMSN.

comScore released general data on Internet usage by Hispanics, but several of the portals put out some of the comScore numbers to best reflect their position in a market that is beginning to take off once again.

For instance, Terra.com, which is the Spanish-language portal of the Terra-Lycos network, put out a release saying it was a leader among portals for U.S. Hispanics who are bilingual and those for whom English is their preferred language.

Yahoo! was quick to point out that its entire network was the No. 1 choice for U.S. Hispanics in general and No. 1 for Hispanics here with a preference for Spanish.

Looking at the data in a less-partisan manner -- total pages viewed and total unique users -- here is how the portals shake out for the month of January:

• All Yahoo! Spanish sites: 155 million page views and 1.25 million unique users. • Univision.com: 148 million page views and 1.04 million unique users. • StarMedia: 121 million page views and 903,000 unique users. • Terra Lycos: 88 million page views and 1.02 million unique users. • Yahoo! en Español: 80 million page views and 845,000 unique users. • MSN Group: 61 million page views and 1.23 million unique users.

BELLSOUTH HELPS WITH AMBER ALERTS

BellSouth has joined Florida's Amber Alert network, providing alerts in cases of child abductions to more than 15,000 field technicians, 62,000 employees and 1.5 million Internet users in its entire nine-state region.

BellSouth will send electronic messages with alerts from the Florida Department of Law Enforcement to staffers in the field via pagers and laptops. The alerts will be posted on BellSouth's home page of its ISP users and on the company Intranet for employees.

The Amber Alert system is designed to put out notification of missing children as widely and quickly as possibly. The system and pending legislation to make it a requirement in every state got renewed attention two weeks ago after the return of Elizabeth Smart, the kidnapped Salt Lake City girl, because her family are big supporters.

While other companies and organizations such as electric and gas companies, TV and radio broadcasters, are supporting the Amber Alert network, BellSouth is making one of the biggest commitments since its operations and workers are spread over several states.

Amber alerts are named after Amber Hagerman, a 9-year-old girl abducted in Arlington, Texas, and later found murdered. Bulletins are distributed quickly through radio and television broadcasts and electronic highway signs about kidnapped children and their abductors.

Source Monday March 24, 2:36 PM By Irene Kwek Of DOW JONES NEWSWIRES

SINGAPORE (Dow Jones)--Oil prices strengthened early Monday in Asia, boosted by concern among market participants that the Iraq war might go on longer than many had initially envisaged.

Crude futures on the New York Mercantile Exchange spiked as much as 79 cents a barrel, or 2.9%, to $27.70/bbl in the first minutes of the after-hours Access session, reversing most of the losses from Friday's floor trade.

"People think the war is going to take longer, and (the coalition forces) will face more resistance than expected," a U.S.-based broker said.

The gains in crude futures helped lift the rest of the petroleum complex, with May gasoline futures posting a 1.43-cent gain to 85.90 cents/gallon at 0635 GMT. April heating oil was up 1.65 cents to 77.21 cents/gallon.

At 0635 GMT, Nymex May crude was at $27.42/bbl, shedding some of its gains early in the session.

Nymex May crude futures plummeted to a three-month low at the close of floor trade Friday as coalition forces secured Iraq's Southern oil fields, helping to support market perception that the war in Iraq would see a quick end.

But reports over the weekend that coalition forces were facing fierce resistance in their push to Baghdad led market participants to start factoring in the possibility that the war in Iraq could be a long drawn-out affair.

"There's another chance we could see another oil price spike because in the past few days the futures were oversold on speculation that it would be a quick war," said Gordon Kwan, HSBC's oil and gas analyst.

"But today's military action appears to suggest otherwise, that this will be longer than expected. The deteriorating situation in Nigeria, Venezuela's production is still off-peak, and some production was lost in Iraq and Kuwait...We can see oil prices bouncing back," he said.

"Oil prices could retest $30/bbl again this week unless the military operations were extremely smooth going into Baghdad, but it appears to be more difficult than we have witnessed so far," he said.

Stiff Resistance

U.S. and U.K. officials late Sunday said specially trained paramilitary guerrillas and Saddam Hussein's security forces were leading the stiffest resistance to the U.S.-led invasion, trying to keep Iraqi soldiers from surrendering and organizing battlefield tricks that have inflicted casualties.

Members of the Fedayeen Saddam are suspected of having organized battlefield ruses using civilian clothes and cars and fake surrenders of Iraqi soldiers that drew in U.S. forces to be attacked in places like An Nasiriyah and Umm Qasr, the officials said.

The Fedayeen are elite inner-circle soldiers totaling about 15,000 that report directly to one of Saddam's sons.

Other difficulties included Iraq's capture of a handful of U.S. soldiers, the accidental downing of a U.K. aircraft by a U.S. missile, and a grenade attack on forces in Kuwait blamed on a Muslim U.S. soldier.

U.S. President George W. Bush and U.S. military officials said the Iraqi regime ultimately will fall, but warned of tougher fighting to come as U.S.-led forces advance on Baghdad.

Bush said Sunday that Iraq's Southern oil fields were secure and that most of the South was in allied hands, though there were pockets of resistance. British forces were holding the area, and experts were being brought in to fight the 10 or so well fires, U.S. Defense Secretary Donald Rumsfeld said Sunday.

However, coalition forces still hadn't secured the country's rich oil fields in the North.

In other developments, ChevronTexaco Corp. (CVX) shut down 440,000 barrels a day of oil production in the western Niger Delta in Nigeria due to ethnic violence. Royal Dutch/Shell Group (RD) and TotalFinaElf (TOT) have also shut in some production there, leaving 28% of the country's 2.2 million barrels a day in output off line.

More Than Ample Supply?

Despite the disruption of Iraqi oil exports due to the war, Societe Generale raised the possibility of a major surplus in the second quarter that will be difficult for the Organization of Petroleum Exporting Countries to manage.

SG noted in a research report distributed Monday that a combination of lower seasonal demand in the second quarter, a possible release of U.S. strategic reserves, and increased oil production, all mean that there are sufficient alternative sources of oil to make up for the disruption of Iraqi exports.

Since the start of the year, OPEC output, excluding Iraq, has increased by more than 3 million b/d, thanks to the return of Venezuelan oil exports and an increase in output by Saudi Arabia and other OPEC countries with spare capacity, it noted.

Looking ahead, the challenge facing OPEC will be to react promptly after the war ends to prevent oil prices from collapsing, SG said.

"Yet it is precisely because we believe that OPEC will be unable to show the same responsiveness as in the past that we are more bearish than the market consensus for the second quarter," SG said.

-By Irene Kwek, Dow Jones Newswires; 65-6415-4062; irene.kwek@dowjones.com

-Edited by Nick vonKlock

<a href=www.wilmingtonstar.com>More Last changed: March 23. 2003 5:16PM The Associated Press After weeks of big increases, gas prices rose less than a penny nationwide over the past two weeks as oil markets calmed with the beginning of U.S.-led military action against Iraq, an industry analyst said Sunday. The average price for gas nationwide, including all grades and taxes, was about $1.76 a gallon on Friday, according to the Lundberg survey of 8,000 stations. That was an increase of just 71 cents from March 7, the date of the last Lundberg survey. "Right now it appears possible that this year may already have seen its peak pump price," said analyst Trilby Lundberg. War fears and uncertainty over the outcome of the Iraq crisis combined with a strike in Venezuela to send gas prices up more than 25 cents a gallon so far this year. The price is leveling off now due to factors including the perception that the war will not substantially impact Iraqi oil production, Venezuela's comeback after the strike, and production increases by Saudi Arabia, Kuwait and others, Lundberg said. "There was a lot of jargon such as war premium - it was more like an uncertainty premium," Lundberg said. "The perception changed in favor of supply security enough so that oil futures prices have tumbled down." The price of a barrel of oil dropped $8 last week, from $34.93 at the close of the day March 17 - the day President Bush gave Saddam Hussein 48 hours to leave Iraq - to $26.90 at the end of the day Friday. Lower prices could lie ahead, Lundberg said, "assuming of course there is no refining problem with getting our spring and summer formulas into place." Still, one year ago motorists were paying 38 cents less per gallon - a weighted average of $1.38. The national weighted average price of gasoline, including taxes, at self-serve pumps Friday was about $1.73 per gallon for regular, $1.82 for mid-grade and $1.91 for premium.