Pirates went undetected late Wednesday by naval patrols in Indonesian and Malaysian waters, said Noel Choong, chief of the International Maritime Bureau's piracy reporting center in Kuala Lumpur.

Using a fishing boat, about five armed pirates boarded the Thai vessel, after first firing several warning shots in the waters, said Choong. The pirates, who were believed to be Indonesian, kidnapped two of the 16 crew.

The pirates escaped and later contacted the ship's owner to demand a ransom, which will likely be paid, said Choong.

IMO reported 37 pirate attacks in the Malacca Strait in 2004.

Pakistan develops fuel cell technology

Pakistan has developed a new technology to make fuel cell technology locally following successful testing.

It said the breakthrough was a good energy alternative to when oil and gas reserves reach depletion.

The Pakistan Institute of Nuclear Science & Technology, or Pinstech, an institute of Pakistan Atomic Energy Commission, made the breakthrough and takes the lead in the development of fuel cell technology in Pakistan. The fuel cells are efficient and environment friendly power sources, said PAEC sources.

Fuel cells mostly operate on hydrogen gas that can be obtained from different sources, including electrolysis of water by nuclear and other sources.

Fuel cells have widespread usage including space and defense. Polymer electrolyte membrane fuel cells can also be used to make stationery, automobiles and other devices.

Shell fearful stocks may not trade

Shell said Friday leftover shares in Royal Dutch Petroleum could still be traded alongside new Royal Dutch Shell PLC stock.

Shell will be traded as a single stock, under Royal Dutch Shell PLC, starting July 20, but the group acknowledges not enough investors may accept its restructuring plans, leaving leftover shares.

For nearly a century, The Hague-based Royal Dutch Petroleum Co. and London-based Shell Transport & Trading Co. PLC were traded separately. Company assets are divided 60-40 between Royal Dutch Petroleum and Shell Transport.

The reform comes in the wake of Shell's pledge to eliminate problems surrounding the company's serious mismanagement of its oil reserves that led to a crisis in 2004.

Shell also remains confident of achieving the acceptance of shareholders from Shell Transport and Royal Dutch Petroleum, said one senior company source. Royal Dutch Petroleum must receive a 95 percent of the vote to approve the deal.

"We are confident of getting to an acceptable number," said the senior official. "If you get 94.2 percent acceptances it is a no-brainer. If you get only 4 percent acceptances it is a no-brainer. It is somewhere in between where it becomes more difficult."

Shell's problems are exacerbated due to its total shareholder base being split 40-30-30 between Britain, Europe and the United States.

Company shareholders must accept the deal by July 18, two days before trading of the new single stock beings. Shell meanwhile has declined to disclose how company shares are held by institutions and private investors.

Australian gas partners, China fail in talks

Shell said Thursday it expects to sign an LNG deal with China at its Gorgon venture, offshore Western Australia, despite recent holdups in talks.

"Discussions are continuing and we're still as confident as we've ever been that we will get them to conclusion at some time," said Tim Warren, chairman of Shell Australia. "These LNG deals are long-term contracts that take time."

"I think that both sides would rather get it right than actually set a deadline," said Warren.

Partners in the Gorgon project signed an initial $22.72 billion agreement in October 2003 to supply 100 million tons of liquefied natural gas to China National Offshore Oil Corp. for a 25-year period.

Although project partners and CNOOC expected to finalize a deal by the end of 2004, talks failed to meet a subsequent March 31, 2005, deadline.

Ownership restructuring at Gorgon in April complicated talks; restructuring doubled the amount of gas that can be marketed to customers after inclusion of the Jansz field.

Shell holds 25 percent of the Gorgon venture; Chevron, project operator, has 50 percent; and ExxonMobil holds the remaining 25 percent.

Vietnam increases production to meet blackouts

As Vietnam looks to ease the burden of power shortages this summer, its state-owned company has managed to increase oil and gas production.

The Vietnam Oil and Gas Corp., or PetroVietnam, reported last Thursday it extracted 7.55 million tons of crude oil in the first five months of 2005, or 42 percent of its annual target.

The company also produced 3.9 million cubic yards of gas, a 24 percent increase from the same period last year.

The company's Nam Con Son Gas project off the southern province of Ba Ria Vung Tau increased output by 30 percent. Gas production from the Nam Con Son project supplies Phu My, Vietnam's largest electricity complex, which has a capacity of 3,600 megawatts.

Closing oil prices, June 6, 3 p.m. London

Brent crude oil: $54.13

West Texas intermediate crude oil: $55.19

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