PETROL & ENERGY 24.08.2015

America’s suffering shale patch is about the only place in the U.S. where there’s nostalgia for the dark days of the financial crisis.

While the global economy started to unravel in 2008, it was also the beginning of the biggest oil boom in U.S. history.

Domestic production, which had been steadily declining since the bust of 1986, began to climb in 2009. OPEC cut output to an average of 28.5 million barrels a day that year, putting a floor under prices. And at the heart of the shale revolution, states like North Dakota, Texas and Oklahoma enjoyed lower rates of unemployment than the rest of the U.S.

Sure, crude plummeted to $32 a barrel in December 2008, but it didn’t stay there for there for long. Analysts described it as a V-shaped bust, and by May the following year oil was back above $65. Plenty of people counted on a repeat in 2015.

This year, thousands of oilfield workers have been laid off. OPEC is pumping 32 million barrels a day and letting their higher-cost competitors in the U.S. sweat it out. And instead of a rebound, oil tumbled below $40 a barrel again for the first time since 2008. 



Liberia: Weeks after a FrontPageAfrica investigative report pointed to looming bankruptcy at the National Oil Company of Liberia, a decision has reportedly been reached to downsize the struggling oil company in order to save it from collapse. The decision, FrontPageAfrica has learned, will Mean scores of employees and senior-level managers Including The Chief Operating Officer, Dr. Randolph Mcclain And The Entire Board Of Directors Will Be Out Of Their Jobs By September 30th. 

Libya: A state oil firm loyal to Libya's official government based in the east of the country has invited foreign oil firms to discuss existing oil purchase contracts at a conference in Dubai next month, it said in a statement. The move is a fresh attempt by Libya's internationally recognised government to control state oil firm NOC, which is at the centre of a conflict between two rival administrations four years after the ousting of Muammar Gaddafi. 

Morocco: San Leon Energy has spudded the El Aaiun-4 well onshore in Morocco. The London-listed company is focused on oil and gas exploration in Europe and North Africa. The new well is on the Tarfaya conventional licence. The well is being drilled with Entrepose Drilling’s Cabot 750 rig and is expected to take approximately 30 days to reach total depth (TD) of around 2,000m. 

Nigeria: Shell said on Friday that its Nigerian joint venture lifted its force majeure on natural gas supplies to the Nigeria Liquefied Natural Gas Co (NLNG) after repairing a pipeline. The force majeure was put in place on Aug. 4 after the company discovered a leak on the Eastern Gas Gathering System (EGGS-1). 

Nigeria: The Department of Petroleum Resources (DPR) has clampdown on about 23 private oil depots in Lagos for allegedly conniving with middlemen to cause the current hike in pump price of petrol in parts of the country. The Controller, DPR in Ilorin, Kwara state capital, Mr. Amos Jokodola disclosed this to journalists in Ilorin. Independent Petroleum Marketers Association of Nigeria (IPMAN) had penultimate week raised the alarm over the charges on fuel loading from various depots in Lagos where they claimed they pay N81.62K as against government official price of N77.61K. 

Senegal: Cairn Energy Plc, operator of the Senegal joint venture, has announced it will drill an exploration well on the Bellatrix prospect offshore Senegal as the third well in the upcoming appraisal and exploration program. FAR and its joint venture partners in Senegal will start appraisal drilling on the world class SNE discovery in early Q4. The three wells in the firm drilling program is expected to be drilled using the ConocoPhillips contracted Ocean Rig Athena drillship. 

Tanzania: East Africa-focused junior producer Wentworth Resources announced Friday the first gas delivery from its Mnazi Bay Concession in southern Tanzania to the country's new transnational pipeline. Wentworth said that two wells are now producing, with the three remaining wells expected to be put on production in the coming months. Initial production volumes will be used for commissioning purposes and to fill the pipeline, with production rates expected to increase to 70 million cubic feet per day by October this year and 80 MMcf/d by the end of 2015. 

Middle East

Iran: Oil output reached 2.9 million barrels per day from 2.7 million bpd and export of gas condensates reached 1,350,000 bpd from 1,200,000 bpd. According to the information secretariat on function of the government of Hope and Prudence in gas sector in Iranian year of 1393, in addition to Phase 12 of South Pars, which was operating at the refining capacity around 75 million cubic meters a day, the other phases of 15, 16 and 17 were brought to operation to refine around 120 million cubic meters a day. 

Jordan: Trafigura and BG Group will each deliver a liquefied natural gas (LNG) cargo to Jordan in October following a recent tender, trade sources said. Trafigura will deliver the first of the two shipments scheduled for Oct. 6-7, a trader said.

Oman: Alizz islamic bank signed a strategic financial agreement with Medco LLC (Oman), a subsidiary of PT Medco Energi Internasional Tbk or MedcoEnergi, a leading Indonesian energy company with focus on exploration and production of oil and gas. The bank provided MedcoEnergi a guarantee under the Islamic finance principle of kafalah, favouring Petroleum Development Oman ( PDO ) for the Karim Small Field (KSF) project. Alizz islamic bank is the first bank to extend Islamic banking facilities to Medco, a press release said. 

Saudi Arabia: State oil giant Saudi Aramco is considering whether to build a new industrial city in the south of the al-Ahsa district in Saudi Arabia's Eastern Province, as authorities seek to expand the kingdom's industrial base, industry sources said. International engineering companies have already bid for engineering work, the sources added, declining to give details for commercial reasons. Saudi Aramco declined to comment. 


Rest of the World

Australia: AWE Limited, the Operator of Permits L1/L2 in the Perth Basin, Western Australia, reported Friday initial 2P Reserves and upgraded 2C Contingent Resource estimates for the Waitsia gas field following evaluation of the Waitsia-1 and Waitsia-2 appraisal well results. Managing Director, Bruce Clement, said the data gathered from Waitsia-2 allowed AWE to significantly increase the company’s previous estimate of gross recoverable gas and book initial 2P Reserves. “Waitsia-2 has proved to be another major success for AWE. With three wells now drilled on the Waitsia field, we have sufficient data to increase our estimates of total gross recoverable gas, on a P50 basis, from 290 billion cubic feet (Bcf) of gas to 484 Bcf of gas – an uplift of 67 percent,” he said. 

Brazil: Brazil oil regulator ANP named the first 12 companies on Friday that have been approved to participate in an upcoming auction of oil and natural gas exploration areas. The companies that will take part in the auction, scheduled for Oct. 7, include Portugal's Galp Energia, Petro Rio , Royal Dutch Shell, Angola state oil company Sonangol and Engie, the ANP said. 

India: The Indian government has set a floor price for the sale of shares in top state-run refiner Indian Oil Corp Ltd at 387 rupees each, the company said, a two percent discount from Friday's close. New Delhi is seeking to raise as much as $11 billion by selling stakes in state-run companies this fiscal year, crucial to narrowing the fiscal deficit to a planned 3.9 percent of gross domestic product in 2015/16. (Selected by SPTEC Advisory from Reuters, August 23)

India: Mercator has discovered oil in Jyoti-2 well on Block CB-ONN-2005/9 of Cambay Basin, India. The well was drilled to a depth of 2,806m, penetrating various hydrocarbon layers. Multiple zones were perforated and the well flowed very good quality light oil of 41° API at 2 Mbbl/d through 32/64" choke and up to 5 Mbbl/d through 64/64" choke.

Malaysia: Malaysia's Hibiscus Petroleum Berhad's jointly-controlled entity, Lime Petroleum Norway AS has executed an agreement with Lundin Norway AS1 to acquire a 30 percent stake in license PL410 in the North Sea. Upon completion, Lundin -- as operator of PL410 -- will hold 52.35 percent, while Lime Norway and Statoil Petroleum AS2 will own 30 percent and 17.65 percent, respectively. 

Malaysia: Vitol Investment Partnership, an investment vehicle sponsored and managed by Vitol, has agreed to acquire MISC Berhad's 50% stake in VTTI BV for cash consideration of $830 million. Vitol will own 100% of VTTI BV, which will continue to be run as an independent, standalone company. 

Norway: Operator Statoil and its partners have been given the formal approval to develop the first phase of their giant Johan Sverdrup oil field off the coast of Norway, the country's energy ministry said on Friday. The largest field found in the North Sea in three decades could hold as much as 2.9 billion barrels of oil and has an estimated cost of up to 220 billion Norwegian crowns ($26.80 billion), of which the first phase is budgeted at 117 billion. 

Norway: The Petroleum Safety Authority Norway (PSA) has granted consent to Lundin to drill 16/1-25S exploration well in Rolvsnes prospect on Block 16/1, located in PL338C in the North Sea. Lundin has also received an approval from the PSA to drill 6407/10-4 exploration well in PL700B, Norwegian Sea. 

Peru: Peru's state-owned energy company Petroperu opted not to take a stake in the country's biggest oil block as expected because the short-term contract signed this week would mean more risk and less profit, the firm said Friday. Petroperu said in June that it would likely exercise its option to take a stake of up to 25 percent in block 192 as allowed under a law designed to strengthen the company, which has not produced oil in more than 20 years. 

Russia: Russian oil producer Gazprom Neft has brought its second well into production at its Arctic Prirazlomnoye field, with output totalling 1,800 tonnes per day. Its launch will see production increase more than two-fold in comparison with 2014 production levels at Prirazlomnoye, which stood at 300,000 tonnes. The depth of the new well extends to more than 4,500 metres, with drilling undertaken by Russia’s GAZPROM Burenie LLC. 

Energy Prices

Crude Oil ($/BBL)

Brent: $ 44.33 -3.82%
WTI: $ 39.42 -3.33%
OPEC Basket: $ 44.13 -2.78%

Natural Gas ($/MMBTU)
Henry Hub: $ 2.64 -3.65%

Steel ($/MT)
Steel Billet: $ 115.00
(LME Official – 3 months Buyer)

€ 1 = $ 1.1422 +1.29%


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