Page 9 - LatAmOil Week 21 2020

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Meanwhile in Azerbaijan, ExxonMobil has resumed efforts to sell its 6.8% stake at the giant BP-operated Azeri-Chirag-Gunashli (ACG) oil project. The US giant reportedly began looking for a buyer for its share last year, but fetching a suitable price will be difficult now. ACG’s share- holders are not only earning far less for each barrel following the price collapse but are also having to cut production over the next two years to meet Azerbaijan’s OPEC+ obligations.
If you’d like to read more about the key events shaping the former Soviet Union’s oil and gas sector, then please click here for NewsBase’s FSUOGM Monitor.
Major LNG projects advance
Some major LNG projects are still moving for- ward, despite the oversupply that has led some developers to delay plans for adding new lique- faction capacity. In some cases, though, the pro- gress is coming at the regulatory level. As a result, there are no guarantees that a given project will ultimately reach the final investment decision (FID) stage.
This is the case with Alaska LNG, which received authorisation from the US Federal Energy Regulatory Commission (FERC) on May 21. The approval marks the conclusion of an environmental review process that has taken over three years. While the approval has been welcomed, the project remains mired in uncer- tainty, owing to the high cost of development. Its price tag was previously estimated at $43bn but was recently reviewed; an updated figure has not yet been disclosed, though.
It has previously been reported that state- owned Alaska Gasline Development Corp. (AGDC), the project’s backer, may sell off the 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- tion significantly in the coming years despite the
current oversupply in the market.
Indeed, Qatari Minister of Energy Saad
al-Kaabi, who is also the CEO of Qatar Petro- leum (QP), said that if there is capacity for the country to grow its LNG output 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 scheduled for July loading that have been cancelled could be as high as 35-45, which would mark an increase compared to June. 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 output 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.
If you’d like to read more about the key events shaping the global LNG sector, then please click here for NewsBase’s GLNG Monitor.
Middle Eastern moves
Developments in Saudi Arabia and Iraq are at the forefront in this week’s MEOG.
The recent volatility of the oil market has encouraged these two countries to come together for major diplomatic and energy ini- tiatives. Saudi Arabia’s decision to appoint an ambassador to Baghdad and its leadership in a further bout of OPEC production cuts represent milestones in the evolving energy crisis.
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