Page 9 - NorthAmOil Week 41 2022

NorthAmOil PROJECTS & COMPANIES NorthAmOil

EOG reported to have paid $84mn

in third quarter to settle hedges

US US shale oil and gas producer EOG Resources natural gas prices have remained strong, with an
has disclosed that it paid $847mn during the average of almost $8 per million British Thermal
third quarter of this year to settle hedges on Units in the third quarter compared to some
energy prices. The disclosure came in a regula- $7.60 in the second quarter.
tory filing this week. EOG’s second-quarter earnings were $2.74
Settling a hedge in this sort of situation occurs earnings per share, well below the $4.25 that ana-
when a company bets the wrong way on oil and/ lysts expected. But the company had revenues
or gas prices. This occurs because oil and gas of $7.41bn during the quarter, compared with
producers often enter hedge contracts – most a consensus estimate of $5.58bn. Its quarterly
especially when prices are volatile – to guarantee revenue was up 79.0% compared to the same
sales at a fixed price. quarter last year.
Energy prices have soared especially since In early August, the company had said that it
Russia’s invasion of Ukraine in February, but in intended to deliver approximately 4% oil and gas
late September oil settled at a nine-month low as volume growth in 2022 and 2023. Inflation and
the dollar strengthened. supply chain problems have dented expectations,
According to Reuters, US crude had averaged said company executives, and inflation could
some $91.65 per barrel in the third quarter of continue to dog the market throughout next year.
2022, ended September 30, below the $108 aver- “Oilfield service capacity remains extremely
age of the second quarter. tight and is further constrained by the limited
The price of crude had soared to some $120 availability of materials and experienced labour,”
per barrel in June but has since dropped to the added chief operating officer Billy Helms in a call
$80s amidst fears of a global economic recession. with investors, adding that the situation could
In contrast, the news service reported that continue into 2023.™

ENERGY TRANSITION

ExxonMobil unveils CCS project in Louisiana

LOUISIANA A landmark emissions reduction project in Lou- “CF Industries is pleased to partner with
isiana has been announced. ExxonMobil, CF ExxonMobil through this definitive CO2 offtake
Industries and EnLink Midstream are planning agreement, accelerating our decarbonisation
to collaborate on the largest-of-its-kind com- journey and supporting Louisiana’s and the
mercial agreement to capture and permanently country’s climate goals,” said Tony Will, presi-
store up to 2mn tonnes per year (tpy) of carbon dent and chief executive officer, CF Industries
dioxide (CO2) emissions. Holdings.
The CO2 will be captured from CF Industries’ “As we leverage proven carbon capture and
manufacturing complex in Louisiana. sequestration technology, CF Industries will
Start-up for the project is scheduled for early be first-to-market with a significant volume
2025, say the companies. The project will sup- of blue ammonia. This will enable us to supply
port Louisiana’s objective of net-zero CO2 emis- this low-carbon energy source to hard-to-abate
sions by 2050, they add. industries that increasingly view it as critical to
ExxonMobil will develop a 125,000-acre their own decarbonisation goals.”
(51-hectare) CO2 geologic storage site in Dan Ammann, president of ExxonMobil
Vermilion Parish, Louisiana. The CO2 will be Low Carbon Solutions, added: “This landmark
transported there from CF’s manufacturing project represents large-scale, real-world pro-
complex through EnLink Midstream’s pipeline gress on the journey to decarbonise the global
network. economy.”
CF Industries is investing as much as $200mn The project may be followed by others.
to build a CO2 dehydration and compression Ammann added: “ExxonMobil is providing
unit at its Donaldsonville, Louisiana facility a critical and scalable solution to reduce CO2
to enable captured CO2 to be transported and emissions, and we’re ready to offer the same ser-
stored. vice to other large industrial customers in the
The 2mn tonnes of emissions captured annu- state of Louisiana and around the world. We’re
ally will be equivalent to replacing approximately encouraged by the momentum we see building
700,000 gasoline-powered cars with electric for projects of this kind, thanks to supportive
vehicles (EVs) , said the companies. policies such as the Inflation Reduction Act.”™

Week 41 13•October•2022 www. NEWSBASE .com P9