Page 9 - MEOG Week 30

MEOG PoLiCy MEOG
NIOC offers more crude as further discounts are considered
iran
tHE National Iranian Oil Co. (NIOC) is o ering 2mn barrels of heavy crude on the Iran Energy Exchange this week while the country’s parlia- ment considers allowing greater discounts to incentivise sales.
According to Iran’s o cial energy industry media outlet Shana, the crude o ering is NIOC’s h on the exchange since March 31 and will be sold on July 30 at a price of $58.81 per barrel.
tehran has been experimenting with selling crude over the exchange in response to the US ramping up pressure on Iranian oil customers to reduce shipments. It has held o erings of light and heavy crude on IRENEX since October 28 last year as it tries to provide a variety of sales mechanisms to appeal to buyers.
Shana reported that NIOC sold 70,000 bar- rels over the exchange on April 30.
In an e ort to entice more buyers, the Minis- try of Petroleum (MoP) cut the minimum pur- chase order for the June 11 o ering from 35,000 barrels to 1,000 barrels for land delivery, while the clearance period for payments has been extended from 60 days to 90.
Shana added that interested parties must pay 6% of their order value in local or foreign cur- rency by 12:30pm local time (GMt+4:30), two hours before trading begins.
Cargoes can either be delivered by sea at the Kharg Island terminal or by land at the tabriz Re nery.
NIOC o ered 2mn barrels of gas condensate on June 3 at $67.14 per barrel, with the minimum purchase noted at 1,000 barrels.
e amendments to the purchase and pay- ment terms are nothing new. An amendment to the Iranian budget was approved on February 17, requiring the MoP to o er 2mn barrels per month of light crude on IRENEX. is came in addition to the 2mn barrels of heavy crude oil and 2mn barrels of natural gas condensates and natural gas the ministry was already obliged to supply to the exchange.
However, Middle East Oil & Gas (MEOG) reported on June 11 that a total of just 1.1mn barrels of crude had been sold so far over the exchange.
With the response from buyers muted, Fars News Agency quoted Assadolla Qarekhani, a member of the Majlis Energy Commission, as saying that Parliament had agreed that more needed to be done to entice buyers.
Qarekhani said that the current discount of 5% to Persian Gulf free on board (FOB) prices was not attractive enough.
He told Fars: “Majlis is ready to let discount rates up to 15% to help improve oil sales via IRENEX.” Qarekhani added: “Offering dis- counts to boost oil export is better.”
Iranian oil exports shrank to 300,000 barrels per day (bpd) in June and may have fallen fur- ther in July.™
ProJeCts & ComPanies
QP lines up Kenya work
Qatar
QAtAR Petroleum (QP) has signed deals with Eni and total to take stakes in three blocks o shore Kenya. Qatar has been taking a more involved position in Somalia of late, with whom Kenya has a maritime border dispute, but these three blocks are not contested.
QP said it had entered the L11A, L11B and L12 blocks in a statement on July 23. e state- backed Qatari company will hold a 25% stake in the blocks while total will have 33.75% and Eni 41.25%. e Italian company also serves as the operator. e deal requires approval from the Kenyan government. e blocks cover around 15,000 square km, in water depths from 1,000 to 3,000 metres deep.
eheadofQP,whoisalsoQatariMinisterof State for Energy A airs, Saad Sherida Al-Kaabi, notes the frontier nature of the Kenyan blocks,
and said the deal would “further strengthen our presence in Africa”. e o cial went on to express optimism about “collaborating with our valuable partners Eni and total, and the govern- ment of Kenya in these blocks”.
QP has stepped up its e orts to expand its exploration and production interests around the world in the last couple of years, particularly throughout East Africa. In March of this year, it struck a deal with Eni, allowing the Qatari company to enter Block A5-A, in Mozambique’s Angoche Basin. is followed a deal with Exx- onMobil, in December 2018, on a neighbouring block in the basin.
In February 2018, QP bought into total’s block o shore South Africa, which early this year was announced to hold the Brulpadda discov- ery. e Qatari company struck an earlier deal
sea disPute
A dispute between Mogadishu and Nairobi over sea borders has seen the dispute taken to the International Court
of Justice. A ruling
on this is expected in September. Kenya has licensed some parts
of the disputed area, while Somalia has also demarcated blocks in the region.
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