Page 10 - AfrOil Week 22a 2020

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Middle Eastern moves
All eyes are focused on OPEC’s next move but Iran has found a way to tweak the US’ nose.
This week’s scheduled meeting of OPEC+ to consider an extension of the oil production cuts agreed for May and June will be closely watched by the industry. The past two months have seen unprecedented volatility and, leading up to this week, oil prices have fluctuated wildly; it is reasonably clear that much hangs on OPEC’s meeting.
Turkey’s moves in various areas of the Medi- terranean have a familiar ring and the latest is its plan to launch oil exploration in East Med under a pact with Libyan government. This could be considered both a daring and provocative initia- tive and it is likely that much more will be heard on this and other moves in the coming months.
There is mixed news from the Emirates: ADNOC was obliged to cut July crude nomi- nations to meet the requirements of the OPEC+ pact but there are signs of progress on bids for ADNOC’s gas pipelines.
Even more mixed news comes from Iraq: Pet- rofac has secured a further six-month contract extension with BOC for its long-standing Iraq Crude Oil Export Expansion Project but more to the point, Iraq’s oil rig count has tumbled by almost two thirds this year. Iraq has struggled more than most to meet its reduced quota. Its new prime minister has a very hard hand to play now and looking ahead.
If you’d like to read more about the key events shaping the Middle East’s oil and gas sector, then please click here for NewsBase’s MEOG Monitor.
Cutting back, but looking
to the future in North America
WTI prices have remained relatively stable above $30 per barrel in recent days, but this level is not high enough for many US producers. In one of the latest illustrations of the industry’s struggles, Occidental Petroleum announced on May29thatitwascuttingitsdividendby91%.
This takes the company’s dividend to $0.01 per share – the lowest level since at least the 1970s.
Occidental is struggling more than many thanks to the debt it took on last year to acquire Anadarko Petroleum in what proved to be an ill- timed bet on shale and rising oil prices.
It is not just smaller companies that con- tinue to struggle, though; super-major Chevron announced on May 27 that it would cut its global workforce, which now stands at around 45,000, by up to 15%. No further details of the lay-offs have been provided as yet.
Rival ExxonMobil said it had no plans to cut staff, but would nonetheless reduce its operating expenses by 15%.
The two super-majors held their annual
meetings last week, and shareholders of both
rejected resolutions calling for the companies to
set targets for greenhouse gas (GHG) emissions
reductions, among other measures. While Exx-
onMobil and Chevron have generally been more has tumbled resistant to such measures than their European
counterparts, this leads to questions over how the oil market downturn could affect the pace of the energy transition.
Despite the broader slowdown in North America’s oil and gas industry, a new exploration prospect that could be targeted in future years has been identified.
Applied Petroleum Technology (APT) said it had conducted a detailed evaluation of the Southern Grand Banks petroleum system off- shore Eastern Canada for multiple clients. It reported that it had identified previously unrec- ognised Lower Jurassic source rocks and a genet- ically related set of oil shows.
However, the findings come at a time when oil companies are unlikely to be rushing to explore the waters off Canada – or indeed other offshore areas. If more exploration ultimately takes place, it will be some time from now.
If you’d like to read more about the key events shaping the North American oil and gas sector, then please clickhereforNewsBase’sNorthAmOilMonitor.™
Iraq’s rig count
by almost two thirds this year
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w w w . N E W S B A S E . c o m Week 22 03•June•2020