Oil And Gas News / Reports
ExxonMobil makes FID to develop West Barracouta gas project

ExxonMobil Corp. plans to produce natural gas for the Australian market by 2021 following a final investment decision to develop West Barracouta gas field in Bass Strait. The project, on the VIC/L1 Block offshore Victoria, is part of the Esso-BHP Gippsland basin joint venture.


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IEA revises downward non-OPEC supply growth forecast for 2019

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 agreed last week, and to lower growth in Canada. “By agreeing a cut of 1.2 million b/d, and additional output curbs in Canada, producers may go some way towards restoring balance to the world market,” IEA said.


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CruzSur seeks test of old well in Colombia

A subsidiary of CruzSur Energy Corp., Vancouver, BC, wants to test an old well near a recent technical discovery on the Maria Conchita block in the Department of La Guajira, Colombia. The subsidiary, MKMS Enerji Sucursal Colombia, is seeking modification to an environmental license that would allow it to test the Aruchara-1 well drilled by Texaco in 1980. MKMS operates the 60,076-acre block.


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Witnesses give US House RFS quota discussion draft a frosty reception

Witnesses at a Dec. 11 US House Energy and Commerce subcommittee hearing generally applauded the sponsors’ effort in releasing a discussion draft weeks earlier that would reform the Renewable Fuel Standard’s quotas by establishing a national octane specification beginning in 2023.


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Pertamina lets contract for Balikpapan refinery revamp

PT Pertamina has let a contract to PT Pupuk Indonesia subsidiary PT Rekayasa Industri (Rekind) to provide services related to inside and outside battery limits (ISBL, OSBL) projects as part of Pertamina’s previously announced Balikpapan Refining Development Master Plan (RDMP) project to upgrade and modernize its 260,000-b/d refinery in Balikpapan, East Kalimantan, Indonesia.


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Oil flow increases at Iraq’s Halfaya field

Oil production at Halfaya field in southern Iran increased to 370,000 b/d after start-up of a new processing facility, an official of Maysan province told Reuters. The field, operated by PetroChina, had been producing 270,000 b/d.


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MARKET WATCH: NYMEX crude oil drops on OPEC unity concerns

Light, sweet crude oil for the January contract dropped modestly to approach $51/bbl, settling at $51.15/bbl on the New York market Dec. 12 on concerns about the Organization of Petroleum Exporting Countries’ ability to make the production cut that it announced last week.


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Needed oil-output limits defy Trump’s misguided harangues

Parties to the Dec. 7 agreement limiting oil production had to take seriously messages coming from the US—but not tweets from the White House.

 


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EIA STEO revises Brent, WTI oil-price forecasts downward for 2019

In its latest Short-Term Energy Outlook (STEO), the US Energy Information Administration has revised its 2019 price forecasts for Brent and West Texas Intermediate to $61/bbl and $54/bbl, respectively, which are both $11/bbl lower than forecast in the STEO for November.


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Cogent Midstream lets contract for Midland basin gas plant

Cogent Midstream has let a contract to Honeywell UOP for the previously announced expansion of natural gas processing capacity in the lower Midland basin of West Texas that will add a refrigerated cryogenic processing plant at the same location as its existing Big Lake gas plant in Reagan County, Tex.


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Manchin to succeed Cantwell as Senate Energy panel’s top Democrat

US Sen. Joe Manchin (D-W.Va.) will become the Energy and Natural Resources Committee’s ranking minority member when Congress reconvenes in January, it was announced on Dec. 12. He will succeed Maria E. Cantwell (D-Wash.), who has been the committee’s top Democrat since January 2015.


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Cenovus to focus 2019 budget on Foster Creek, Christina Lake

Cenovus Energy expects to allocate the majority of its planned 2019 budget of $1.2-1.4 billion to sustain base production at its Foster Creek and Christina Lake oil sands operations. The company also plans to complete construction of the Christina Lake Phase G expansion. With an approved design gross capacity of 50,000 b/d, production startup from the expansion is expected in second-half 2019.


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Total signs E&P contracts for blocks off Mauritania

Total and the Ministry of Petroleum, Energy, and Mines of Mauritania have signed an agreement awarding Total two exploration and production contracts for Blocks C15 and C31 deep offshore Mauritania, covering a 14,175-sq km area. Based on the contracts, Total will serve as operator of these two blocks with a 90% interest alongside SMHPM, which will hold the remaining 10%.


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French Guyana: Total commits to exploration campaign

Total SA reported on plans to begin its exploration campaign on the Guyane Maritime license, 150 km off French Guyana. Total’s objective on the license is to drill one last exploration well, following the five formerly drilled during 2011-13 to conclude definitively whether an exploitation phase is relevant.


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BOEM extends EIS comment period for proposed Beaufort Sea lease sale

The US Bureau of Ocean Energy Management has extended the public comment period for a proposed environmental impact statement (EIS) relating to a proposed 2019 Beaufort Sea oil and gas lease sale, the agency’s Anchorage office said on Dec. 11.


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EIA: US crude inventories down 1.2 million bbl

US crude oil inventories, excluding the Strategic Petroleum Reserve, decreased by 1.2 million bbl for the week ended Dec. 7, according to data from the US Energy Information Administration. At 442 million bbl, US crude oil inventories are about 7% above the 5-year average for this time of year, the report indicated.


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Marathon extends Bakken acreage with Ajax wells

Marathon Oil Corp. reported an average 30-day initial production of more than 2,400 boe/d (84% oil) from a four-well Middle Bakken pad in the Ajax area of the Williston basin in Dunn County, North Dakota.


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Watching Government: Carbon tax idea reappears
Did the Democrats regaining majority control of the US House in the recent midterm elections improve the legislative climate for a federal carbon tax? Its prospects certainly look brighter now than when the Republicans were in charge and opposed to any proposal for a new federal tax.
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Cuadrilla stops hydraulic fracturing in Bowland shale

Privately owned Cuadrilla Resources Ltd. again stopped hydraulic fracturing operations at its Preston New Road natural gas drilling site in Lancashire, northwest England, after minor tremors were detected Dec. 11. Fracturing in the Bowland shale has been halted three times since October.


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DEA to focus on Zama discovery with Sierra acquisition
DEA Deutsche Erdoel AG (DEA), Hamburg, has agreed to acquire Sierra Oil & Gas, Mexico City, giving it access to a portfolio of six exploration and appraisal blocks in Mexico, including the Zama discovery.
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EPA establishes fresh renewable fuel, biomass-based diesel quotas
The US Environmental Protection Agency established quotas on Nov. 30 for renewable fuels in 2019 and for biomass-based diesel in 2020. EPA said the conventional renewable fuel quota, which is met primarily by corn-based ethanol, will be maintained at 19 billion gal in 2019, while required advance biofuel volumes will climb by 630 million gal from 2018 to 19.92 billion gal.
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OPEC’s November oil production averaged nearly 33 million b/d

The Organization of Petroleum Exporting Countries produced 32.97 million b/d on average for November, down 11,000 b/d from October, secondary sources to the cartel reported Dec. 12 in its Monthly Oil Market Report. Saudi Arabia’s production climbed by 377,000 b/d from October to November to reach 11.01 million b/d.


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New Vietnamese refinery reaches full startup

Nghi Son Refinery & Petrochemical has started full commercial operations at its 200,000-b/d refinery and petrochemical complex in Thanh Hoa Province in Vietnam. Implemented to secure stable domestic supplies of petroleum products in Vietnam, the refinery began operating commercially on Nov. 14, stakeholder Idemitsu Kosan said on Dec. 11.


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MARKET WATCH: NYMEX crude oil holds under $52/bbl pending inventory report

Light, sweet crude oil prices for the January and February contracts rose modestly to settle below $52/bbl on the New York market Dec. 11 pending release of a weekly US government report on crude oil and product supplies. On world markets, crude prices were supported after Libya’s National Oil Corp. announced force majeure on exports from El Sharara oil field following a recent attack by a militia group.


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Frontera, CGX Energy sign Guyana joint venture agreement

Frontera Energy Corp. has signed a farm in agreement with CGX Resources Inc. for two shallow-water blocks offshore Guyana. Subject to governmental approval, Frontera will acquire a 33.33% interest in the Corentyne (1.125 million net acres) and Demerara (750,000 net acres) blocks in exchange for a $33.3-million signing bonus. Both blocks are adjacent to ExxonMobil Corp.’s Stabroek block.


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Environmental groups sue to stop Mid-Atlantic OCS seismic surveys

Nine environmental organizations have sued US Commerce Sec. Wilbur L. Ross and the National Marine Fisheries Service (NMFS) on Dec. 11 after NMFS issued incidental harassment authorizations on Nov. 30 to five contractors seeking to conduct the first seismic surveys since the 1980s for oil and gas on the US Mid-Atlantic Outer Continental Shelf.


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Eni starts up Vandumbu production offshore Angola

Vandumbu field started producing oil on deepwater Block 15/06 offshore Angola in November, 3 months ahead of schedule, reported operator Eni SPA. Production at Vandumbu field, along with the start-up of a subsea multiphase boosting system (SMBS) in early December, is boosting the oil production from Block 15/06 by 20,000 b/d via West Hub’s N’Goma FPSO.


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Oil find confirms potential of part of Block 15/06 off Angola

An oil discovery in the Afoxe exploration prospect offshore Angola is a further confirmation of the oil exploration potential still held in southern part of Block 15/06, previously considered mainly gas prone, operator Eni SPA said. The company plans to to drill as many as four exploration wells back-to-back on the block in 2019.


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Yamal LNG begins Train 3 exports

PAO Novatek has begun LNG exports from Train 3 of its Yamal LNG plant in Russia, reaching the site’s planned full capacity of 16.5 million tonnes/year. Novatek said it completed work on the 5.5-million tpy third train more than a year ahead of schedule. An additional 900,000-tpy train is under construction with startup planned for early 2020.


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MARKET WATCH: Crude benchmark prices drop in correction after OPEC

Crude oil benchmarks settled down by more than $1.60/bbl on Dec. 10 in a market correction to an initial surge in oil prices on Dec. 7 following news that the Organization of Petroleum Exporting Countries and 10 non-OPEC countries agreed to cut production by 1.2 million b/d.


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China ZhenHua Oil buys interest in onshore concession from ADNOC

Abu Dhabi National Oil Co. (ADNOC) reported that a 4% stake in its onshore concession has been acquired by North Petroleum International Co. Ltd., a subsidiary of China ZhenHua Oil Co. Ltd. Previously, the stake was held by CEFC China Energy Co. Ltd.


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Equinor granted drilling permit in North Sea

Equinor Energy AS has been granted a drilling permit by the Norwegian Petroleum Directorate for well 36/1-3 in production license 885 in the North Sea. The well will be drilled about 40 km east of the Peon discovery using the Transocean Spitsbergen semisubmersible drilling rig.


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Virginia AG, DEQ sue Mountain Valley Pipeline over alleged violations

Virginia Atty. Gen. Mark R. Herring (D) announced that the state’s Department of Environmental Quality (DEQ) and Water Quality Board sued Mountain Valley Pipeline LLC (MVP) for alleged repeated environmental violations in five southwestern Virginia counties over the past year, particularly during major rain events.


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Bakken, Guyana earmarked for 75% of Hess’s $2.9-billion budget in 2019

Hess Corp. will allocate some 75% of its $2.9-billion 2019 exploration and production capital and expenditure budget to high-return growth assets in the Bakken and in Guyana. Net production is forecast to average 270,000-280,000 boe/d in 2019, excluding Libya, compared with 245,000 boe/d in 2018. Bakken net production is forecast to average 135,000-145,000 boe/d in 2019.


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Hunt for expertise tests foreign views of changes in India

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ConocoPhillips sets $6.1 billion capex budget for 2019

ConocoPhillips has set a capital expenditure budget for 2019 of $6.1 billion, which is flat to its expected full-year 2018 capex, excluding acquisition costs. The 2019 budget does not reflect potential dispositions that may occur in 2019.


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Iran’s oil exports likely to remain 1.1-1.3 million b/d
Iran’s oil exports likely will remain at 1.1-1.3 million b/d for the rest of this year despite waivers the US government granted to eight countries after imposing US sanctions on Iranian oil sales, said Sara Vakhshouri, president of SVB Energy International in Washington, DC.
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WoodMac: Qatar exiting OPEC not ‘huge surprise’
Qatar reported Dec. 3 it would withdraw from the Organization of Petroleum Exporting Countries on Jan. 1, 2019, putting an end to its 57-year membership of the oil producers’ cartel. Qatar, which said it intends to focus on its natural gas production, made the announcement ahead of the Dec. 6 OPEC meeting.
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MARKET WATCH: Crude benchmarks jump more than $1/bbl after OPEC meeting

Crude oil benchmarks on the New York and London markets climbed by more than $1/bbl on Dec.7 after the Organization of Petroleum Exporting Countries and a group of 10 non-OPEC countries, led by Russia, agreed to cut production by a total 1.2 million b/d effective Jan. 1, 2019.


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Alberta to cut oil output by 325,000 b/d
Saying it is responding “to the historically high oil price differential that is costing the [Canadian] economy more than $80 million/day,” the Alberta government on Dec. 2 announced a curtailment in oil production beginning Jan. 1.
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Confrontation with Russia may make Ukraine energy reforms more urgent
Russia’s Nov. 25 seizure of three Ukrainian patrol vessels and their crews in the Kerch Strait near the Black Sea provided a dramatic reason as speakers at a Nov. 28 discussion at the Atlantic Council in Washington called for more changes in Ukraine’s energy system if the government in Kiev is serious about wanting the country to break free of Russian influence.
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Cooperation between government, oil industry essential, NPC told
Cooperation between the federal government and the US oil and gas industry that helped move the nation from reliance on imports to leadership in exports will remain essential to compete with the Organization of Petroleum Exporting Countries and Russia in the years ahead, US Energy Sec. Rick Perry and Interior Sec. Ryan K. Zinke separately told the National Petroleum Council at its Dec. 4 meeting.
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Efforts to control
As US President Donald Trump pressed Saudi Arabia, before last week’s meeting of the Organization of Petroleum Exporting Countries, to keep oil production high and prices low, the government of Alberta moved the opposite way. At this writing, OPEC had not yet met, and Trump had not yet tweeted disparagingly about Alberta Premier Rachel Notley. Maybe he didn’t notice.
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US oil production peaking?
The shale insurgency in the US continues to defy the doubters, producing more than 11.7 million b/d of crude oil at the end of November, according to the US Energy Information Administration.
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International news for oil and gas professionals


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Needed oil-output limits defy Trump’s misguided harangues

Parties to the Dec. 7 agreement limiting oil production had to take seriously messages coming from the US—but not tweets from the White House.

 


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BLM issues proposed final greater sage grouse plan EISs, amendments

The US Bureau of Land Management proposed final environmental impact statements and amendments to greater sage grouse habitat management programs in seven western US states. “With today’s action, we have leaned forward to address the various states’ issues, while appropriately ensuring that we will continue to be focused on meaningfully addressing the threats to the greater sage grouse and making efforts to improve its habitat,” Deputy Interior Sec. David Bernardt said in Salt Lake City on Dec. 6.


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Central signs gas sales contract for NT-to-Queensland system

Central Petroleum Ltd., Brisbane, is to sell gas to pipeline operator Jemena for commissioning of the Northern Gas Pipeline (NGP) connecting the Northern Territory pipeline grid to the Queensland system via Mount Isa. It is now anticipated that the pipeline will be ready to begin commercial flow between Dec. 29, 2018, and Jan. 10, 2019.


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Baker Hughes: Canada drops 13 rigs for the week

Canada lost 13 rigs for the week ended Dec. 7, according to Baker Hughes data. With 186 rigs running, the count is less than the 219 units drilling this week a year ago. The number of oil-directed rigs in Canada fell by 17, bringing the count to 102 rigs for the week. Gas-directed rigs were up 4 to 84 units.


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South Korean firm plans Australia’s fifth proposed LNG import terminal

South Korean developer EPIK, based in Seoul, has proposed the establishment of a floating LNG import terminal at the Port of Newcastle north of Sydney on Australia’s east coast. EPIK has signed an agreement with the Port of Newcastle to conduct preliminary work on the project, which is expected to cost as much as $430 million (Aus.), including onshore infrastructure.


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