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The Malaysian company intends to use the rig to Quarterly losses mount in North America
sink one well at the Sloanea section of the block Second-quarter losses being announced by
and will probably begin drilling in the fourth North American producers have continued to
quarter of this year. Equity in Block 52 is split pile up in recent days. Virtually no company is
50:50 between Petronas and ExxonMobil (US), expected to emerge unscathed from the quar-
which is already a major player in neighbouring ter, which likely saw the worst of the oil and gas
Guyana’s offshore zone. downturn. (See: Second-quarter losses pile up,
In other news, the Energía Costa Azul LNG page 9)
project is still on hold. California-based Sem- Notable names joining the growing ranks
pra Energy and its Mexican subsidiary IEnova of those reporting second-quarter losses over
had hoped to take a final investment decision the past week have included ConocoPhillips,
(FID) on the scheme by the end of June but are the US’ largest independent producer. On an
still waiting for Mexico’s government to issue an adjusted basis, excluding special items, the com-
export permit. Company executives say they are pany posted a loss of $1.0bn compared with an
still optimistic about pushing the project for- adjusted profit of $1.1bn in the same quarter of
ward soon, even though Mexican government 2019.
bureaucracies are operating more slowly because US-based super-majors ExxonMobil
of the coronavirus (COVID-19) pandemic. and Chevron also posted rare losses, which
reached $1.1bn and $8.3bn respectively. For
If you’d like to read more about the key events shaping ExxonMobil, this was the second consecu-
the Latin American oil and gas sector then please click tive quarterly loss after decades of profits.
here for NewsBase’s LatAmOil Monitor. Chevron’s loss, meanwhile, was its largest in Oil production
recent history, exacerbated by $5.6bn worth
Mideast: Gulf OSPs to drop as output rises of oil and gas production write-downs. Cana- from OPEC
Oil production from OPEC member countries dian producers were not spared either, with
has increased by 1mn barrels per day (bpd), as Imperial Oil, ExxonMobil’s subsidiary north member states
producers in the Gulf are stepping back from of the border, and Husky Energy among those
their extra voluntary output cuts. reporting second-quarter losses over the past has increased by
As production has increased, there is grow- week. 1mn bpd.
ing speculation that Saudi Aramco and ADNOC However, some bright spots also emerged,
will cut their official selling prices (OSPs) for as US oil prices continued to hold steady above
crude cargoes to Asia loading in September as $40 per barrel and a number of the companies
they seek to continue efforts to increase mar- reporting their results also said they were in the
ket share. Saudi OSPs will set the trend for the process of restoring output they curtailed during
month’s prices throughout the Gulf, so much will the second quarter.
depend on what happens in the next day or two. Among these was ConocoPhillips, which
As producers turn the pumps back on, Kuwait said it expected to have most of its curtailed
Oil Co. (KOC) is preparing a tender for 24 new output restored by the end of September, hav-
rigs to help achieve the country’s ambitious ing cut about a third of its production in April
crude output capacity targets. The news follows and recently started ramping it back up. And in
our recent coverage of production ramping up to Canada, Husky said it had the capacity to ramp
75,000 bpd at the Lower Fars Heavy Oil Project up production over the course of the current
and the departure of the first cargoes of crude. quarter.
Meanwhile, news emerged this week that In other welcome news, the total US rig
Occidental Petroleum was in advanced talks count stayed flat in the week up to July 31, hav-
with Pertamina over the sale of assets in Ghana ing declined for the previous 20 weeks. (See:
and the UAE. The US firm has been considering Weekly rig count flat after 20 weeks of declines,
asset divestments to ease its debt burden follow- page 15) The loss of one active oil rig was off-
ing the $37bn acquisition of Anadarko last year. set by the addition of a gas rig. The rate of rig
count declines has slowed in recent weeks, but
If you’d like to read more about the key events shaping while market conditions are improving, pro-
the Middle East’s oil and gas sector then please click ducers may be hesitant to ramp up new drill-
here for NewsBase’s MEOG Monitor. ing too quickly.™

P8 www. NEWSBASE .com Week 31 06•August•2020