Page 12 - FSUOGM Week 40

FSUOGM NRG FSUOGM

This move raises questions about Petro-
bras’ plans for the facility, as Golar had been
the only company to submit a binding offer
for the lease contract. The NOC has revealed
that Compass Gas e Energia, a local firm,
declined to bid, and BP Energy do Brasil, a
subsidiary of BP (UK), has asked for more
time to finalise its offer.
In other news, Brazilian officials are
reported to be in talks with Argentina on a gas
import deal. The two sides are discussing pro-
posals for the construction of a $1.2bn pipe-
line that would pump gas from unconventional
fields in Argentina’s Vaca Muerta formation to
southern Brazil.
Elsewhere in South America, ExxonMobil is
pushing forward with work at the Stabroek block Deals close in US
offshore Guyana. The US super-major said last Some major oil and gas deals have been com-
week that it had taken a final investment decision pleted in the US in recent days. Most notably,
(FID) in favour of developing the Payara section this week Chevron announced that it had closed
of the block after securing the Guyanese govern- its $13bn acquisition of Noble Energy after more
ment’s approval for its plans, which carry a price than 90% of the latter’s shareholders approved
tag of $9bn. the transaction.
The acquisition gives Chevron a number
If you’d like to read more about the key events shaping of domestic and international assets that the
the Latin American oil and gas sector then please click super-major has described as being comple-
here for NewsBase’s LatAmOil Monitor . mentary to its existing operations. Domestically,
this includes shale acreage in the Permian Basin,
Middle Eastern political and production Denver-Julesburg (DJ) Basin and the Eagle Ford
deals come to the fore shale. Internationally, Noble’s most attractive
As production numbers were announced for assets are located in the Eastern Mediterranean,
September, compliance with the cartel’s out- offshore Israel and Cyprus, as well as off Equato-
put cut deal came into sharp focus. This has rial Guinea in West Africa.
broadly improved, with surprising laggard Another notable deal that closed over the past
the UAE catching up by making swingeing week involved the sale of Barnett shale gas assets
reductions to production during the month. belonging to Devon Energy to Banpu Kalnin
However, there is little sign of compliance Ventures (BKV). Devon announced on October
from Iraq, which saw another output increase, 1 that the transaction had been completed. The
despite repeated promises to make compen- US company received a cash payment of $320mn
satory cuts. from BKV upon closing of the deal, after adjust-
Iran, Libya and Venezuela all also recorded ing for a $170mn deposit that was paid in April
production upticks, with the Islamic Republic and purchase price adjustments.
registering an additional 120,000 barrels per Under the sale agreement, Devon stands to
day, while exports doubled to 1.5mn bpd. Mean- receive further contingent cash payments of up to
while, cartel kingpin Saudi Arabia also registered $260mn, depending on future commodity prices.
a significant increase in exports as it reduced its The company said upside participation would
official selling prices (OSPs) to Asia. begin at either a Henry Hub gas price of $2.75 per
Following the US’ brokering of a peace deal million British thermal units ($76.07 per 1,000
between the UAE and Israel, the three parties cubic metres) or a West Texas Intermediate (WTI)
this week agreed to co-operate on energy-related oil price of $50 per barrel, starting in 2021.
matters. The deal was as wide-reaching as it was The announcement that the Barnett shale
vague, but will be played as a major foreign pol- deal had closed came within days of Devon’s
icy win by the White House in the run-up to the announcement that it was merging with another
November presidential election. shale company, WPX Energy. The latter has core
Washington was not done in the region, positions in the Permian and Williston basins
though, and will play a mediatory role in the and this, combined with the Barnett sale, illus-
coming to the table of Israel and Lebanon as they trates Devon’s shift towards more oil-rich assets.
seek to resolve a lengthy dispute about their mar- The merger is being touted as providing a
itime border. An agreement could lead to explo- roadmap for future consolidation in the shale
ration in Lebanon’s Block 9 by a consortium led industry, involving stock rather than cash, and
by Total. little to no premium.
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 ™

P12 www. NEWSBASE .com Week 40 07•October•2020