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venture’s assets if it does not find another party to develop Alaska LNG. Obtaining authorisation from FERC could help de-risk the project sig- nificantly in the eyes of potential investors and developers.
Elsewhere in the world, Qatar has reiterated its commitment to increasing its LNG produc- tionsignificantlyinthecomingyearsdespitethe current oversupply in the market. Indeed, Qatari Minister of Energy Saad al-Kaabi, who is also the CEO of Qatar Petroleum (QP), said that if there is capacity for the country to grow its LNG out- put beyond the planned 126mn tonnes per year (tpy), it may commit to this in the coming years.
Meanwhile, few developments illustrate the short-term impact of recent developments on demand more clearly than the growing number of cancellations for cargoes that were scheduled for loading at US terminals. Bloomberg has estimated that the number of US cargoes sched- uled for July loading that have been cancelled could be as high as 35-45, which would mark an increase compared to June.
Ifyou’dliketoreadmoreaboutthekeyevents shaping the global LNG sector, then please click here for NewsBase’s GLNG Monitor.
latin america’s hopes rising
Several Latin American countries appear to be optimistic about the future of oil and gas, despite the shocks the industry has suffered over the last two months.
Omar Gutierrez, the governor of the oil-pro- ducing Neuquen province in Argentina, has praised the government’s decision to introduce an artificially high domestic price floor, calling it “a great stimulus for investment, production and especially for the protection of jobs. Some indus- try observers believe that the new policy will do little to bring production back up to pre-pan- demic levels, though.
In Brazil, Royal dutch Shell has begun drill- ing at Saturn, a new block in the offshore Santos Basin. The super-major remains upbeat about the potential of the pre-salt zone but believes Brazilian projects will have to fight hard to attract investment in the future.
Guyana, meanwhile, has named all 35 of the companies that have bid for the right to market the government’s share of oil from Liza, a field within the offshore Stabroek block. It has also said it will seek help from experts in evaluating bidders.
Jaguar E&P, an independent Mexican opera- tor, has drawn attention to “under-drilled” areas along the Gulf coast and in the northern parts of the country. According to Warren Levy, the company’s CEO, the northern Burgos Basin is particularly attractive because of its proximity to the US Permian basin.
In other news, Colombian officials are
working to address private companies’ concerns about high oil pipeline tariffs. A representative of the National Hydrocarbons Agency (ANH) has said that the government may take the unprec- edented step of intervening in the tariff regime, which is under the control of Ecopetrol’s Cenit subsidiary.
Ifyou’dliketoreadmoreaboutthekeyevents shaping Latin America’s oil and gas sector, then please click here for NewsBase’s LatAmOil Monitor.
north american shale shifts
The gas-rich Marcellus shale is reported to have edged out the Permian Basin as the top US des- tination for hydraulic fracturing crews. Accord- ing to data from investment advisory firm Tudor, Pickering, Holt & Co., the Marcellus accounts for 31% of the active hydraulic fracturing crews in the field, while the Permian accounts for 30% and the Eagle Ford and Haynesville shales account for 14% each.
The rise of the Marcellus formation came as USrigcountscontinuedtheirdownwardtrajec- tory, dropping by a further 21 in the week up to May 22. Oil-focused rigs were the only ones to decline in number, dropping from 258 to 237, while gas rigs stayed at 79 and two rigs labelled “miscellaneous” also remained unchanged. This was the third consecutive week of new record lows for the rig count.
According to US Secretary of Energy dan Brouillette, over 2.2mn barrels per day (bpd) of US oil production has now been shut in.
It was not all bad news for the US oil industry, however, as a second consecutive weekly drop in oil inventories helped to keep West Texas Inter- mediate (WTI) prices in the $30-35 per barrel range.
The recovery in prices has been welcomed, but there are signs that the industry is still nowhere near being able to sustain itself and that more bankruptcies are looming.
Outside the shale patch there is cautious opti- mism about demand beginning to recover. On May 21, the operator of the Trans-Alaska Pipe- line System (TAPS) announced plans to end its temporary curtailment of oil production on the state’s North Slope, citing the start of a recovery in global demand. The curtailment began in April, peaking at 75,000 bpd.
On a more pessimistic note, though, Cono- coPhillips, Alaska’s largest oil producer, con- firmed separately that it was sticking with plans to cut about half its production in the state in June. This will bring yields down by about 100,000 bpd.
Ifyou’dliketoreadmoreaboutthekeyevents shaping the North American oil and gas sector, then please click here for NewsBase’s NorthAm- Oil Monitor.™
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w w w . N E W S B A S E . c o m Week 21 27•May•2020