Page 6 - NorthAmOil Week 19 2022
P. 6
NorthAmOil INVESTMENT NorthAmOil
Seneca selling California
oil assets to Sentinel Peak
CALIFORNIA SENECA Resources, a unit of National Fuel Gas, reserves in the state amount to roughly 21.5mn
has agreed to sell its entire portfolio of Califor- barrels of heavy oil in central California, includ-
nian oil and gas assets to Sentinel Peak Resources ing in the areas of Coalinga, Lost Hills, Taft and
California. The deal was announced in National Kern County.
Fuel’s first-quarter earnings release and is valued National Fuel attributed its decision to pursue
at $280-310mn depending on future oil prices. It a sale based to strong commodity prices, as well
is expected to close on June 30. as the continued growth of its Appalachian Basin
Under the terms of the deal, Seneca will operations.
receive $280mn in cash upon closing. Addition- “Our California operations and the team sup-
ally, it could also receive up to three annual con- porting them have been a terrific asset to Seneca
tingent payments from 2023 to 2025 that could over the three-plus decades that we have owned
amount to $30mn in aggregate. The value of the them, generating substantial free cash that sup-
contingent payments has been set at $1mn for ported our significant investment in the Appala-
each dollar that Brent crude prices average above chian Basin,” stated National Fuel’s president and
$95 per barrel in each of the relevant years, up to CEO, David Bauer. “Proceeds from this transac-
a maximum of $10mn in any given year. tion will help accelerate our deleveraging efforts
The size of the assets involved in the trans- and provide us additional financial flexibility in
action was not specified in the announcement, the near term.”
but Seneca has indicated that it is currently pro- For Sentinel Peak, the acquisition adds to its
ducing about 6,100 barrels per day (bpd) of oil existing assets in the San Joaquin Basin and the
in California. The company said its total proven LA Basin.
POLICY
Canada in talks on expediting
East Coast LNG exports
EASTERN THE Canadian government is in talks with the This could represent a turnaround in fortunes
CANADA developers of two proposed LNG export termi- for Pieridae, which shelved plans to develop its
nals on Canada’s East Coast to see whether it Goldboro LNG project in mid-2021, citing
can help expedite those projects, it emerged last cost pressures and time constraints. The com-
week. pany had already started talking about reviving
Canadian Minister of Natural Resources Jon- Goldboro earlier this year as LNG demand and
athan Wilkinson told Reuters that Ottawa was prices rose, but had called on Ottawa to show a
in discussions with Pieridae Energy and Repsol commitment to supporting the project. While
over terminals in Nova Scotia and New Brun- the outcome of the talks with the Canadian gov-
swick respectively. ernment is not guaranteed, it does now look as
“We are looking at whether there are things though this commitment is closer to materialis-
we can do to expedite one or more of the projects ing than it had been previously.
in a manner that’s consistent with environmental Pieridae confirmed the talks to Reuters, say-
considerations and a long-term transition to a ing it offered a solution that would allow Can-
lower-carbon future,” Wilkinson told the news ada to take a leadership role in supplying LNG
service. through a net-zero emissions facility that was
The discussions are being held with a view to “actionable today”.
boosting LNG supply to Europe as it scrambles Repsol, for its part, acquired 100% owner-
to phase out its imports of Russian gas in the ship of an LNG import facility in Saint John last
wake of the war in Ukraine. Indeed, Wilkin- year. The company has not publicly commented
son said Ottawa was also talking to parties in on its plans for Saint John LNG, but conversion
Germany and elsewhere in Europe to bring to exports looks like an increasingly attractive
would-be importers into the discussion. option against the backdrop of current events.
P6 www. NEWSBASE .com Week 19 12•May•2022
