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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.
In other news, the Energía Costa Azul LNG Notable names joining the growing ranks
project is still on hold. California-based Sem- of those reporting second-quarter losses over
pra Energy and its Mexican subsidiary IEnova the past week have included ConocoPhillips,
had hoped to take a final investment decision the US’ largest independent producer. On an
(FID) on the scheme by the end of June but are adjusted basis, excluding special items, the com-
still waiting for Mexico’s government to issue an pany posted a loss of $1.0bn compared with an
export permit. Company executives say they are adjusted profit of $1.1bn in the same quarter of
still optimistic about pushing the project for- 2019.
ward soon, even though Mexican government US-based super-majors ExxonMobil and
bureaucracies are operating more slowly because Chevron also posted rare losses, which reached
of the coronavirus (COVID-19) pandemic. $1.1bn and $8.3bn respectively. For ExxonMo-
bil, this was the second consecutive quarterly
If you’d like to read more about the key events shaping loss after decades of profits. Chevron’s loss,
the Latin American oil and gas sector then please click meanwhile, was its largest in recent history,
here for NewsBase’s LatAmOil Monitor. exacerbated by $5.6bn worth of oil and gas pro- Oil production
duction write-downs. Canadian producers were
Mideast: Gulf OSPs to drop as output rises not spared either, with Imperial Oil, ExxonMo- from OPEC
Oil production from OPEC member countries bil’s subsidiary north of the border, and Husky
has increased by 1mn barrels per day (bpd), as Energy among those reporting second-quarter member states
producers in the Gulf are stepping back from losses over the past week.
their extra voluntary output cuts. However, some bright spots also emerged, has increased by
As production has increased, there is grow- as US oil prices continued to hold steady above 1mn bpd
ing speculation that Saudi Aramco and ADNOC $40 per barrel and a number of the companies
will cut their official selling prices (OSPs) for reporting their results also said they were in the
crude cargoes to Asia loading in September as process of restoring output they curtailed during
they seek to continue efforts to increase mar- the second quarter.
ket share. Saudi OSPs will set the trend for the Among these was ConocoPhillips, which
month’s prices throughout the Gulf, so much will said it expected to have most of its curtailed
depend on what happens in the next day or two. output restored by the end of September, hav-
As producers turn the pumps back on, Kuwait ing cut about a third of its production in April
Oil Co. (KOC) is preparing a tender for 24 new and recently started ramping it back up. And in
rigs to help achieve the country’s ambitious Canada, Husky said it had the capacity to ramp
crude output capacity targets. The news follows up production over the course of the current
our recent coverage of production ramping up to quarter.
75,000 bpd at the Lower Fars Heavy Oil Project In other welcome news, the total US rig count
and the departure of the first cargoes of crude. stayed flat in the week up to July 31, having
Meanwhile, news emerged this week that declined for the previous 20 weeks. The loss of
Occidental Petroleum was in advanced talks one active oil rig was offset by the addition of a
with Pertamina over the sale of assets in Ghana gas rig. The rate of rig count declines has slowed
and the UAE. The US firm has been considering in recent weeks, but while market conditions are
asset divestments to ease its debt burden follow- improving, producers may be hesitant to ramp
ing the $37bn acquisition of Anadarko last year. up new drilling too quickly.

If you’d like to read more about the key events shaping If you’d like to read more about the key events shaping
the Middle East’s oil and gas sector then please click the North American oil and gas sector then please click
here for NewsBase’s MEOG Monitor. here for NewsBase’s NorthAmOil Monitor .™

Week 31 05•August•2020 www. NEWSBASE .com P11