Oil And Gas News / Reports
US needs to improve its energy innovation process, speakers suggest

The US will need to improve its energy innovation process if it expects to reach the Trump administration’s goal of achieving global energy dominance, speakers agreed at a Jan. 17 Bipartisan Policy Center event. The key will be finding ways to more effectively commercialize innovative research under way at the US Department of Energy’s National Energy Technology Laboratories, they said.


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WoodMac: 150,000 b/d of Chinese refining capacity could close by 2020

About 150,000 b/d of refining capacity could close in China by 2020, due to tight operating environment, according to a recent analysis from Wood Mackenzie. “Chinese refineries did not face crude supply issues in 2018 but there were other challenges,” said WoodMac consultant Rui Hou.


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India’s small-field bid round extended

India’s Directorate General of Hydrocarbons has extended for the second time the close of bidding for its second round of licensing of discovered small fields. Bidding remains open through Jan. 30, DGH said.


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Baker Hughes: US rig count falls 25 units to 1,050

The US drilling rig count dropped 25 units to reach 1,050 rigs working for the week ended Jan. 18. The count is up 114 units from the 936 rigs working this time a year ago, according to Baker Hughes data.


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IEA: Rebalancing of global oil market to be gradual

Despite the signing of a new Vienna Agreement, the journey to a balanced global oil market will take time and is more likely to be a marathon than a sprint, according to the International Energy Agency’s first Oil Market Report in 2019. On the supply side, IEA said, “While Saudi Arabia is determined to protect its price aspirations by delivering substantial production cuts, there is less clarity with regard to its Russian partner.”


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Aramco taps Saipem for Berri, Marjan work

Saudi Aramco has let contracts to Saipem for offshore work expanding Berri and Marjan oil fields. The contracts, totaling $1.3 billion, cover design, engineering, procurement, construction, installation, and implementation of subsea systems and the laying of pipelines, subsea cables and umbilicals, platform decks, and jackets.


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Rystad Energy: Global gas output hit highest growth in a decade in 2018

The worldwide oil and gas industry achieved a net production increase of 164 billion cu m (bcm) in 2018, representing the highest production growth since 2010, according to research by Rystad Energy.


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East Timor approves use of petroleum fund for Sunrise acquisition

East Timor President Fransisco Guterres has approved a decree allowing use of the country’s petroleum fund for the $650-million acquisition of the Royal Dutch Shell PLC and ConocoPhillips’s interests in the Greater Sunrise gas-condensate fields in the Timor Sea. Guterres had previously vetoed the proposal, saying at the time that it could allow the petroleum funds to be misused. He called for the proposal to be revised.


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MARKET WATCH: NYMEX, Brent crude prices drop slightly

Crude oil prices dropped slightly on New York and London markets Jan. 17 on rising US crude production, less-than-robust global demand, and the continuing trade dispute between the US and China. The Petroleum Status Report issued by the US Energy Information Administration Jan. 16 showed US crude production rose to a record 11.9 million b/d. In a separate report earlier this week, EIA said US production in 2019 is expected to reach a record of more than 12 million b/d.


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Costs, energy needs discredit ‘keep it in the ground’ agenda

Preemptive opposition to oil and gas projects by “keep it in the ground” activists promises needless hardship in two broad areas.

 


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Sawan to succeed Brown as Shell upstream director

Wael Sawan has been appointed upstream director of Royal Dutch Shell PLC, and will become a member of the executive committee, effective July 1. He currently serves as executive vice-president, deepwater. He joined Shell in 1997 and has held commercial and operational leadership roles across the upstream, integrated gas, and downstream businesses.


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Husky’s offer for MEG expires without extension

Husky Energy Inc. will not extend its $3.3-billion (Can.) offer to acquire MEG Energy Corp. after the October proposal expired Jan. 16. The company said the minimum tender condition was not met by the deadline and the proposal received insufficient MEG board and shareholder support.


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ZPC lets contract for Phase 2 of integrated complex

Zhejiang Petrochemical Co. has let a contract to Honeywell UOP and Honeywell Process Solutions to provide a range of process technologies, engineering design, equipment, catalysts and adsorbents, and advanced automation controls for units to be installed as part of the second phase of its 800,000-b/d integrated refining and petrochemical complex in Zhoushan, Zhejiang Province, China.


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PGNiG to explore for, produce hydrocarbons in UAE

PGNiG SA will explore for and produce hydrocarbons in Ras Al Khaimah—the northernmost member of the United Arab Emirates—under a production-sharing agreement signed by PGNiG, the Ras Al Khaimah Petroleum Authority, and Rak Gas LLC.


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Gulf Keystone initiates expansion program at Shaikan field

Gulf Keystone Petroleum has initiated an investment program at its operated Shaikan field in the Kurdistan region of Iraq and is progressing plans to increase production to 55,000 b/d. Average gross oil production of 31,563 b/d in 2018 is underpinned by strong performance of the Shaikan Jurassic reservoir, and is in line with expectations, the company said.


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Gullfaks partners submit PDO for more oil recovery

Equinor and its partners in Gullfaks oil field in the Norwegian North Sea’s Tampen area will drill 7 wells believed to improve oil recovery by 17 million bbl with good profitability. The amended plan for development and operation submitted to Norway’s Ministry of Petroleum and Energy calls for additional resource recovery with water injection and production wells in the Shetland-Lista Phase 2 development.


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BOEM employees work on preparing offshore lease sales during shutdown

US Bureau of Ocean Energy Management employees have continued to work on upcoming federal offshore oil and lease sales despite the partial government shutdown that has closed much of the Department of the Interior. BOEM’s updated Fiscal 2019 Contingency Plan for a shutdown called for 124 excepted employees to be available to handle administrative services, emergency response, and support.


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MARKET WATCH: NYMEX oil price gains slightly to stay above $52/bbl

Light, sweet crude oil prices gained modestly on the New York market Jan. 16 after a US government report showed crude oil supplies fell sharper than expected while product inventories rose for the week ended Jan. 11.


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India approves Numaligarh refinery expansion project

Numaligarh Refinery, a group company of Bharat Petroleum, has received clearance to proceed with the long-planned expansion of its 60,250-b/d Numaligarh refinery in the Golaghat district of Assam in far-northeastern India. India’s Cabinet Committee on Economic Affairs on Jan. 16 approved the 225.94 billion-rupee project, which intends to expand crude processing capacity at the refinery by 120,500 b/d to 180,750 b/d.


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EIA: IMO regulations drive up US, global refinery runs

Beginning on Jan. 1, 2020, the International Maritime Organization (IMO) is set to enact the Annex VI of the International Convention for the Prevention of Pollution from Ships (MARPOL Convention), which lowers the maximum sulfur content of marine fuel oil used in ocean-going vessels from 3.5% to 0.5%.


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EIA expects modest global oil inventory builds in 2019-20

Global liquid fuels production will average 101.8 million b/d in 2019 and 103.5 million b/d in 2020, and consumption will average 101.5 million b/d in 2019 and 103.1 million b/d in 2020, which will contribute to modest inventory builds in both years, according to the US Energy Information Administration’s latest Short-Term Energy Outlook. The STEO for January is the first to include forecasts for 2020.


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Equinor reports gas, condensate discovery south of Kristin field

Equinor has, together with partners ExxonMobil, Total, and Norway’s Petoro, made a natural gas and condensate discovery with the Ragnfrid North (6406/2-9 S) exploration well in the Norwegian Sea. The well, drilled in production license 199 about 20 km south of the Kristin platform, will be evaluated for development and tie-in to Kristin field and further maturing of the Kristin South project.


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Baldridge elected chairman of TPA

Don Baldridge, president of commercial for DCP Midstream, has been elected chairman of the Texas Pipeline Association (TPA).


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Woodside lets contracts for Scarborough project

Woodside Petroleum Ltd., Perth, has let four contracts for the front-end engineering and design phase of its proposed Scarborough gas development on the Exmouth Plateau off Western Australia.


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Rystad Energy: Offshore service market growth to outpace shale in 2019

Rystad Energy forecasts offshore spending will outgrow spending on onshore shale activities this year. Service companies exposed to the offshore subsea market and the maintenance, modifications, and operations (MMO) sector are set to benefit from this trend reversal.


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EIA: US crude inventories down 2.7 million bbl

US crude oil inventories for the week ended Jan. 11, excluding the Strategic Petroleum Reserve, decreased by 2.7 million bbl from the previous week, data from the US Energy Information Administration showed. At 437.1 million bbl, US crude oil inventories are about 8% above the 5-year average for this time of year, the report indicated.


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CNOOC starts production from Huizhou development project

CNOOC Ltd. reported the start of production from the Huizhou 32-5 oil field comprehensive adjustment/Huizhou 33-1 oil field joint development project in the south-central part of the eastern South China Sea.


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MARKET WATCH: NYMEX oil price tops $52/bbl, Brent tops $60/bbl

Crude oil benchmarks jumped more than $1/bbl on the New York and London markets Jan. 15 with light, sweet crude oil prices for February and March settling above $52/bbl while Brent crude for March and April settled above $60/bbl in London.


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Oil Search expands Alaskan portfolio
Oil Search Ltd., Port Moresby and Sydney, has expanded its acreage position on the North Slope of Alaska following the recent 2018 Alaska Lease round with the acquisition of interests in prospective blocks close to and adjacent to its existing position in the Pikka Unit east of Prudhoe Bay.
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Preem advances Lysekil refinery restart, VDU project

Swedish refiner Preem AB, a wholly owned subsidiary of Corral Petroleum Holdings AB, Stockholm, has restarted the bulk of operations 228,900-b/d at its refinery at Lysekil, Sweden, following a late December 2018 production disruption caused by an electrical power failure.


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Ineos selects site for €3-billion European petrochemical complex

Ineos AG has selected Antwerp, Belgium, as the site for its previously announced plan to build both a grassroots ethane cracker and propane dehydrogenation unit in northern Europe. To be co-located with Ineos’ existing polymer-production sites in Europe and connected by pipeline to several the operator’s ethylene and propylene derivative units in the region, the €3-billion petrochemical complex will become the largest investment in the European chemicals sector in 20 years, Ineos said.


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Equinor, Aker BP dominate Norwegian licensing round

Equinor and Aker BP dominated awards by Norway’s Ministry of Petroleum as part of the Award in Predefined Areas (APA) for 2018 held Jan. 15. Thirty-three companies were offered ownership interests in 83 production licenses on the Norwegian Continental Shelf—the largest number ever awarded in one licensing round, according to the Norwegian Petroleum Directorate. Twenty-one of the companies will be offered operatorship.


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Colorado Supreme Court reverses impact analysis requirement ruling

The Colorado Supreme Court reversed a lower court’s decision that would have required the Colorado Oil & Gas Conservation Commission to consider potential health and climate impacts before authorizing more exploration and production. The suit was filed after COGCC rejected a late-2013 petition asking it to reject applications for new drilling permits unless they did not pose a human health or climate threat.


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SDX: Appraisal well encounters oil offshore Egypt

SDX Energy Inc. reported its SRM-3 appraisal well encountered oil on the South Ramadan license offshore Egypt in the Gulf of Suez. The operator is Pico. SDX has a 12.75% interest.


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MARKET WATCH: Crude oil prices fall on slowing Chinese economic indicators

The light, sweet crude oil price for February dropped more than $1 on the New York market Jan 14 to settle just above $50.50/bbl while Brent crude for March dropped nearly $1.50 to settle just under $59/bbl in London.


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Congress should end newly relaxed LNG export regulation
Sensible regulatory change by the US Department of Energy should be followed by legislation killing the changed regulation.
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Croatia’s INA to modernize Rijeka refinery

Croatia’s INA Industrija Nafte DD has approved a more-than $617-million plan to modernize its 90,000-b/d Rijeka refinery along the northern part of the Adriatic Sea as part of an organizational strategy to boost performance and competitiveness of its Croatian refining business.


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Watching Government: Offshore oil, gas foes’ bills
US House Democrats wasted little time before seven of them introduced bills on Jan. 8 aimed at keeping oil and gas exploration from expanding off their coastal states’ shores. The federal measures came as state legislators in Connecticut, Georgia, Hawaii, Maine, Massachusetts, New Hampshire, New York, Oregon, and Rhode Island announced a coordinated effort to limit any new capabilities offshore their states.
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IEA revises downward non-OPEC supply growth forecast
In its latest monthly oil market report, the International Energy Agency has revised its 2019 non-OPEC supply growth forecast down by 415,000 b/d to 1.5 million b/d, partly due to expected cuts from Russia and to lower growth in Canada.
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Western Gas signs MOU for Equus gas project off Western Australia
Privately held Western Gas Corp. Pty. Ltd., Perth, has signed a memorandum of understanding with international service companies McDermott and Baker Hughes to be exclusive development partners for the Equus gas project offshore northwest Western Australia (OGJ Online, May 15, 2018).
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Aramco, Petronas near startup of Malaysia’s RAPID refinery
The jointly held Saudi Aramco-Petronas $27-28 billion Pengerang Integrated Complex (PIC) in southeastern Johor, Malaysia, is preparing for official startup of Pengerang Refining & Petrochemical (PRefChem) subsidiary Pengerang Refining Co. Sdn. Bhd.’s 300,000-b/d refinery and petrochemical integrated development (RAPID) project (OGJ Online, Mar. 29, 2018).
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SOCAR commissions unit, wraps Phase 1 of Baku refinery revamp
State Oil Co. of Azerbaijan Republic (SOCAR) has commissioned a bitumen plant as part of a program designed to modernize and expand operations at the company’s Heydar Aliyev (formerly New Baku) refinery at Baku in Azerbaijan, completing the first phase of the 120,500-b/d refinery’s long-planned modernization project.
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Grassroots methanol project revived for Louisiana
South Louisiana Methanol LP (SLM) and new joint-venture partner Saudi Arabian Basic Industries Corp. (SABIC) are planning a $2.2-billion capital investment to build a grassroots methanol complex in St. James Parish, La.
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BP approves expansion at Atlantis field in Gulf of Mexico
BP PLC approved a $1.3-billion expansion at Atlantis field in the Gulf of Mexico and said recent seismic imaging identified 1 billion bbl of additional oil in place at Thunder Horse field. Elsewhere in the gulf, two discoveries near Na Kika platform provide additional development opportunities.
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Use technology to address climate change, Oxy exec advises
More oil and gas producers should be ready to use technology to address climate change instead of denying the problem exists, Occidental Petroleum Corp. Pres. and Chief Executive Officer Vicki A. Hollub recommended on Dec. 14.
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API’s new president cites progress, outlines challenges for 2019
Responsible operations and steadily improving technology have combined to make the US the world’s leading oil and gas producer, said American Petroleum Institute Pres. Mike Sommers in his first major public address on Jan. 8. But carefully conceived policies and improved permitting processes will be necessary to keep the progress going, he told more than 400 attendees at API’s 2019 State of American Energy event.
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Are they serious?
Will Democrats now controlling the US House of Representatives act seriously about climate change or remain stuck in high-minded futility? They promise to make action on climate change a priority for the new session of Congress, during which a presidential election will be held.
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Eyes on the pipe
The US government shut down at midnight, Dec. 22, 2018. What didn’t shut down with it was US politics. If anything, the shutdown has turned up the heat on an already boiling pot of partisan mistrust and posturing. This is no less the case in energy policy than anywhere else.
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Eni wins Sharjah blocks, expands elsewhere

Eni SPA has been awarded the three blocks offered in Sharjah’s first international competitive exploration licensing round while expanding further in the Middle East with deals in Oman and Bahrain. Eni will operate 437-sq-km Concession Area A and 1,184-sq-km Concession Area C with 75% participating interests. Sharjah National Oil Corp. will hold the remaining interests. In 264-sq-km Area B, SNOC will be operator with a 50% interest, and Eni will hold the remainder.


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LLOG Exploration reports deepwater gulf discovery

LLOG Exploration Co. LLC, Covington, La., reported the drilling of a successful discovery on its Nearly Headless Nick exploratory prospect on Mississippi Canyon Block 387 in the deepwater Gulf of Mexico.


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