BERKELEY, Calif. (AP) – Americans’ love of chocolate has become a dark and bittersweet affair, and it took a former vintner to make it so.

John Scharffenberger and Robert Steinberg launched the first U.S. chocolate manufacturing company in half a century, drawing heavily on Scharffenberger’s refined palate and his past as a maker of sparkling wines.

Together, they set out to do for dark chocolate what fellow Californian Robert Mondavi had done for wine — demystify, democratize and domesticate it.

Call it kismet, uncanny timing or creative chemistry, but in the 11 years since co-founding Scharffen Berger Chocolate Maker they have watched the public’s appetite for gourmet chocolate expand from a Valentine’s Day extravagance to an everyday indulgence.

‘We have gone through a food revolution in this country,’ said Scharffenberger. Just as Americans have become more sophisticated about wine, whole-bean coffee, artisan cheeses and other products that once were the luxury of certified foodies have been mainstreamed to the masses.

‘The one thing that remained to be done was chocolate, and that’s what we hit on,’ Scharffenberger said.

Like the label of a fine wine, the wrapper on a Scharffen Berger chocolate tells you exactly what’s inside. It was the first U.S. chocolatier to feature the cacao count prominently on its wrappers — the higher the number, the darker and more bitter the chocolate. And the source of the beans is also noted, for those who like knowing whether their chocolate got its start in Madagascar, Ecuador, Ghana or Peru.

Scharffen Berger bars now are prominently displayed in the checkout lines of grocers like Trader Joe’s, Andronico’s and Whole Foods.

Yet venerable players like Reading, Pa.-based Godiva Chocolatier Inc., part of The Campbell Soup Co., and San Francisco’s Ghirardelli Chocolate Co. jump-started the trend, said Marcia Mogelonsky, an analyst with the market research firm Mintel International. They popularized fancy chocolates with upscale, single-serving packaging, wider distribution and savvy marketing, she said.

Even The Hershey Co., the name synonymous with American chocolate, has invested heavily in premium chocolate, showing it is more than a fad, she said. Besides buying Scharffen Berger 1 1/2 years ago, the company has introduced its own line of premium chocolate bars and late last year purchased Ashland, Ore.-based Dagoba Organic Chocolate.

Between 2003 and 2005, U.S. sales of premium chocolates went from $1.4 billion to $1.79 billion, according to Mogelonsky. While it still represents only a fraction of the overall $15.7 billion chocolate market, the growth rate for the good stuff has been much faster — 28 percent over the three-year period compared to annual rates of 2 to 3 percent for the industry as a whole.

‘People were ready for a change,’ said Mogelonsky. She relates the trend to Americans’ growing self-indulgence.

‘I can’t afford a mink and a diamond, but I can afford a piece of really good chocolate,’ she said.

As with wine and coffee, the origin of premium chocolate has increasingly become a selling point. And consumers have also responded to manufacturers’ efforts to tout their relationships with growers in the developing countries where cacao typically comes from, she said.

The quality and quantity of cacao in a bar or bonbon is what distinguishes fine chocolate from the coating on a Snicker’s, according to Scharffenberger, who personally oversees the blending of 30 varieties of beans that go into the company’s products and visits the ranches in Guatemala, Madagascar and other countries where it secures supplies.

‘We aren’t creating flavors that are earth-shattering, just delicious,’ he said.

The Food and Drug Administration requires milk chocolate to contain at least 10 percent cacao, but Scharffen Berger’s milk chocolate contains a whopping 41 percent. Its darkest dark chocolate, 82 percent.

Before Scharffenberger and Steinberg set up shop, California already was home to plenty of chocolate makers — both high-end and pedestrian. Besides Ghirardelli, they include Glendale-based Nestle USA, Guittard Chocolate Co. in Burlingame, Joseph Schmidt Confections, which also was bought out by Hershey’s last year, and See’s Candies in Carson.

The growth has been steady enough that by 2000 California had edged out Pennsylvania, home of Hershey’s, to become the nation’s chocolate capital. In 2004, the last year for which figures were available, California had 136 companies churning out chocolate and cocoa products compared to Pennsylvania’s 122, according to the U.S. Census Bureau.

Besides its reputation as a food snob’s paradise, there is a practical reason the San Francisco Bay area, in particular, has emerged as the heart of chocolate activity: the consistent, moist climate, according to Scharffenberger.

‘It’s a pain to make chocolate when it’s hot,’ he said.

Like a winery, the company offers tours of its Berkeley factory where participants — about 40,000 of them a year — receive morsels of chocolate trivia along with free samples. On a recent morning, a tour group learned, for example, that cacao beans are technically a fruit, that dark chocolate tastes better melted on the tongue instead of chewed, and that the actual cacao content of white chocolate is zero.

Adrienne Newman, an aspiring chocolatier from Austin, Texas, was taking the tour for the third time after making chocolate ‘a full-time hobby.’ Over the holidays, she took her boyfriend to Switzerland so she could taste the local wares, and she mail orders chocolate from new companies whose products she wants to try.

For a long time, she could still enjoy a Hershey’s bar, Newman said, but no more.

‘I’m beyond that,’ she said. ‘After three years of tasting exquisite stuff, there is no going back.’

Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

CHARLESTON, S,C. (AP) – A lawsuit challenging a book’s account of the 1989 turret explosion that killed 47 sailors aboard the USS Iowa was settled out of court though neither side would discuss the details.

The agreement ends a six-year legal fight over the book ‘A Glimpse of Hell: The Explosion on the USS Iowa and Its Cover-Up.’ Several of the ship’s former officers sued, claiming the account defamed them and was filled with factual errors.

Both sides refused to discuss the settlement terms reached Monday. The book’s publisher, W.W. Norton & Co., issued a letter to the ship’s former officers.

‘To the extent you believe the book implies that any of you were engaged in a cover-up, were incompetent, committed criminal acts, violated Naval regulations or exhibited faulty seamanship or professional ineptitude, Norton regrets the emotional distress experienced by you or your family,’ Norton President W. Drake McFeely said in the letter.

The 1999 book by Charles C. Thompson II, a former producer for CBS’ ’60 Minutes,’ contends the ship was an ‘accident looking for a place to happen.’
The turret explosion occurred during a live firing drill in the Caribbean. The cause has never been determined.

Stephen F. DeAntonio, an attorney representing the ship’s officers, said they ‘feel totally vindicated.’

‘Throughout all the investigations and media coverage of the explosion, no mainstream media came close to reporting the defamatory allegations contained in the book,’ he said.

The case was pursued in Charleston because DeAntonio practices locally and successfully argued to have the lawsuit heard in South Carolina.

The Navy initially said that one of the dead sailors intentionally set a charge to explode in the turret because he was upset over a failed homosexual relationship with another sailor.

Four-star Adm. Frank Kelso later retracted the story and apologized to the sailor’s family.

Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

ROME – Italian police arrested five people Monday, including a local British Gas manager, in a corruption probe into the construction in southern Italy of a gas plant by BG Group PLC.

The five were arrested at dawn by police across Italy, and include the current chairman of BG Italia, the group’s Italian arm, and two former managers, according to financial police in the southern port town of Brindisi.

Prosecutors believe chairman Franco Fassio, former chairman Yvonne Barton and former CEO Fabio Fontana paid bribes to local administrators to speed up the go-ahead for the construction of the liquefied natural gas terminal in Brindisi, police Maj. Massimiliano Tibollo said.

Barton, who is British, and Fontana were placed under house arrest, while Fassio was jailed along with a former Brindisi mayor and a local businessman. Police also conducted 52 searches across Italy and seized the terminal’s construction site, Tibollo said.

The Italian government authorized the project in 2003 and the British gas company had previously said it planned to start up the terminal in 2009.

‘As far as we are concerned we had the full and valid authorization,’ BG spokesman Neil Burrows said.

He said Barton left the company in 2002 and Fontana in 1999, but had no details on the circumstances of their departure.

BG had cooperated with the Italian probe and would continue to do so, Burrows said, adding that the company had received a document relating to the investigation from Italian authorities which it was reviewing.

Burrows said it was too early to comment on Fassio’s future with the company.

Local authorities have fiercely opposed the Brindisi terminal, which the government insists is needed to reduce Italy’s dependence on oil and boost its capacity to import gas.

Italy suffered a gas shortage last winter after a Russian price dispute with Ukraine led to a cut in supplies to some European countries. Terminals like the one planned in Brindisi increase supply by converting back into gaseous form liquid gas that is brought in by ships.

‘If we want to go ahead with gas we need the infrastructure, and a reasonable number of these plants must be built in Italy,’ Industry Minister Pier Luigi Bersani said.

Italian energy analyst Davide Tabarelli said the case is likely to scare away foreign companies wishing to invest in Italian infrastructure, particularly in the underdeveloped south, he said.

‘British Gas was ready for this investment and it was an investment that would have benefited Italy,’ he said. ‘It just doesn’t work. It will be another terrible example of an attempted investment in Italy.’

___

Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

newsdesk@afxnews.com

jfr

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ALBUQUERQUE (AFX) – The Navajo Nation believes a U.S. Environmental Protection Agency ruling that a 160-acre parcel near Church Rock is ‘Indian Country’ gives the tribe a stronger position to fight uranium mining in the area.

The tribe banned uranium mining and processing on its land in 2005, but companies have been trying to revive it, particularly on the eastern side of the reservation and in the Church Rock area, commonly referred to as the checkerboard of Indian and non-Indian land.

New Mexico-based Hydro Resources Inc., which owns the surface and mineral rights, wants to inject chemicals into the ground to release uranium and pump the solution to the surface in a process called in situ leaching.

The EPA’s decision, released Wednesday, means Hydro Resources would have to apply for an underground injection control permit from the EPA, not the state of New Mexico as it previously had done.

‘This is a wonderful decision for the Church Rock community in particular and the Navajo Nation in general in support of efforts to stop any future mining on the Navajo Nation,’ said David Taylor, senior attorney with the Navajo Department of Justice’s Natural Resources Unit.

‘The EPA decision is a first step in what may very well be a long and drawn out legal fight, but it’s always good to win the first battle,’ he said.

The EPA’s decision doesn’t specifically state it will consider the ban when receiving applications for mining-related permits, but Taylor said, ‘We are certainly hoping they will.’

The tribe wants the EPA to make the determination, rather than the state, because under laws and court decisions, ‘the United States has a much higher obligation to protect the interests of Native Americans than the states,’ Taylor said.

Hydro Resources argued in comments to the EPA last year that no part of the land, known as Section 8, is reservation, tribal trust or allotted land, nor has it ever been set aside by the federal government for use as Indian land.

‘Each and every acre of the Section 8 land in question is fee land, the surface and locatable mineral estates of which are owned by HRI as a result of a patent from the United States. There is no dispute on these matters,’ Hydro Resources officials wrote.

A woman who answered the phone at Hydro Resources president Craig Bartels’ home phone Thursday night said he would be unavailable for comment until Saturday.

In the late 1980s, the state Environment Department granted Hydro Resources an underground injection control permit for the property 10 miles northeast of the Church Rock Chapter house.

After considering materials submitted by the Navajo Nation and the state, the EPA determined that the land’s status was in dispute, and said it would be the appropriate agency to issue the permit.

The state and Hydro Resources challenged that decision in 1997 and petitioned for judicial review.

The 10th U.S. Circuit Court of Appeals in Denver upheld the EPA in 2000 and said the agency must rule on the status of the land. The EPA did not immediately respond, thinking Hydro Resources no longer planned to pursue a permit.

The company, however, sought a permit from New Mexico in 2005 to operate a uranium in situ leach mine. The state asked the EPA to make a decision on the status of the land.
Chris Shuey, director of uranium impact assessment for the Albuquerque-based Southwest Research and Information Center, said the implications of the EPA’s decision ‘can go a long, long way.’

For example, Hydro Resources has a 320-acre parcel near Crownpoint on which it plans to place its main uranium processing plant and conduct in situ leach mining, Shuey said. Some 95 percent of the population there is Navajo and receives services from the Crownpoint Chapter.

The EPA considered the makeup of the population and the services the community receives from the Navajo Nation in its decision.

‘If those facts are the same for those other parcels in the middle of Indian communities, those areas should also be Indian Country,’ Shuey said.

Navajo President Joe Shirley Jr. said Thursday mining companies’ lack of respect in the past has caused many Navajos to become ill and die from exposure to uranium ore.

‘I hope this means that there will be no more uranium mining on Navajo land and in what we regard as Navajo country,’ he said. ‘I’m happy for my people residing in the eastern portion of Navajo land and very happy for my government.’

Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

LONDON (AFX) – Frank Chapman, chief executive of BG Group PLC, said the long-delayed Brindisi liquefied natural gas terminal project in Italy is progressing and is likely to come on stream in 2010.

‘The project is proceeding,’ he told reporters at a briefing after the group’s annual results.

He added BG has already are claimed 80 pct of the land’ it needs for the terminal, located at the Brindisi port on the south-east coast of the country.

The facility is likely to be operational ‘at around 2010’ at an increased budget of about 500 mln eur, he told AFX News after the briefing.

BG originally thought the terminal — the first of its kind in Italy — would only require 390 mln eur to build and would be operational by 2007.

Construction work was delayed by environmental issues raised by the local authorities. Enel SpA, BG’s partner in the project, withdrew in 2005, leaving BG the sole owner of the 6-mln-tonne-a-year plant.

Chapman said the terminal has secured all the required ecological permits and BG has not been informed of the Italian government’s decision to re-open the permitting process for the project.

Even if it turns out to be true, he said the government’s action will have ‘no effect whatsoever on the validity of our existing authorisation.’

‘The project continues to enjoy strong support form the EU,’ he added.

Late last year, the Italian government decided to review the permits after the European Commission, it claimed, found BG’s environmental impact assessment report inadequate.

Turning to Kazakhstan, Chapman said the third phase of the Karachaganak gas project has been expanded and will cost around 8 bln usd in total.

BG and Italian partner ENI are joint operators of the field, each with a 32.5 pct stake, while Chevron Corp holds 20 pct and LukOil 15 pct.

The Karachaganak field is believed to be holding over 2.3 bln barrels of oil equivalent, making it one of the world’s largest gas reservoirs.

The third phase, which will start production in 2012, is targeting gas sales of up to 16 bln cubic metres per annum, added Chapman.

Construction of the fourth train in Karachaganak has been sanctioned by the consortium. The train will need 1 bln usd to build and will be operational in 2009, he said.

The gas from the Karachaganak field will be supplied to Russian gas monopoly Gazprom.

monicca.egoy@thomson.com

mbe/slm

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CAIRO, Egypt (AFX) – Measures to reduce global warming would not be devastating economically, and the United States has been ‘particularly delinquent’ on the issue, Paul Volcker, the former chairman of the U.S. Federal Reserve, said Tuesday.

Speaking to the American Chamber of Commerce in Egypt, Volcker said the argument that taxes on oil or carbon emissions, for example, would ruin an economy was ‘fundamentally false.’

‘First of all, I don’t think (such a step) is going to have that much of an impact on the economy overall. Second of all, if you don’t do it, you can be sure that the economy will go down the drain in the next 30 years,’ Volcker said, referring to the impact forecast by a U.N. report last week.

The Intergovernmental Panel on Climate Change reported that global warming is have ry likely’ caused by mankind and that, if it were not reduced, world temperatures and sea levels would rise, as well as the frequency and severity of catastrophic storms and droughts.

Volcker told some 200 Egyptian and foreign business executives that he had been surprised by the warm winter in New York and the cold weather in Cairo, where temperatures dropped to 48 Fahrenheit on Tuesday. ‘Global warming seems to be catching up with us pretty quickly,’ he commented.

‘What may happen to the dollar, and what may happen to growth in China or whatever,’ he said, raising his voice, ‘pale into insignificance compared with the question of what happens to this planet over the next 30 or 40 years if no action is taken.’

‘The scientists seem pretty well agreed that (global warming) is still potentially manageable if we act decisively, beginning now into the next decade or so, by taking measures that are technically and economically feasible.’

Leadership had to come from the United States, ‘and I don’t see much evidence of that happening at the moment,’ said Volcker, who as Federal Reserve chairman in 1979-87 applied politically unpopular measures that brought U.S. inflation under control.

The United States, which produces about one-quarter of the world’s greenhouse gases, is widely criticized for refusing to ratify the Kyoto Protocol, a 1997 pact that requires industrial nations to cut global-warming gases by an average 5 percent below 1990 levels by 2012.
Volcker said taxes either on emissions or on petroleum could be effective in reducing global warming, although it would be difficult to reach an international consensus on the desired levels.

‘It’s an area where in my view the United States has been particularly delinquent,’ he said, adding it would be wiser to impose a tax on oil, for example, than wait for the market to drive up oil prices. A tax would give the government ‘some leverage that you can use for other things.’
Asked why Americans were so reluctant to act on global warming, Volcker said in an interview afterward that he puzzled over the same question.

‘I think any democracy has difficulty focusing on a problem which is not a crisis today but, with a high degree or probability, is going to be a major problem 10, 15, 20 or 30 years from now.’ This was particularly the case when people feared, exaggeratedly in his opinion, that the immediate effects of tackling the problem would be adverse.

‘A lot of people in the United States haven’t been convinced that it’s a problem. Now I think that is changing. The evidence is becoming so strong that may be we are building a base for a political understanding that hasn’t been there before,’ he said.

Copyright 2006 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

HONG KONG (XFN-ASIA) – ConocoPhillips has asked for arbitration in a dispute with China National Offshore Oil Corp (CNOOC) over costs incurred because of Beijing’s windfall tax on oil sales, the Wall Street Journal reported, citing people familiar with the situation.

Under a rule introduced in March 2006, companies that produce oil, both onshore and offshore, to be sold in China are subject to a special tax of 20-40 pct on the portion of the price that is above 40 usd a barrel.

The report was not clear on the arguments put forward by ConocoPhillips in asking for arbitration, but said that under a production contract CNOOC and its foreign partners must agree to amend the contract terms to maintain the foreign partners’ ‘normal economic benefits’ if they are affected by the introduction of a new law.

The report cited a source as saying that ConocoPhillips has activated a clause in its contract with CNOOC that allows its dispute to be heard at the Arbitration Institute of the Stockholm Chamber of Commerce in Sweden.

A spokesman for ConocoPhillips declined to comment when asked whether his company had requested arbitration with CNOOC, tit said.
CNOOC is the parent of Hong Kong-listed CNOOC Ltd.
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