Page 6 - NorthAmOil Week 35 2022
P. 6
NorthAmOil PIPELINES & TRANSPORT NorthAmOil
Canada invokes pipeline treaty
again to protect Enbridge’s Line 5
NORTH AMERICA THE Canadian government has invoked a 1977 In a statement this week, Canadian Foreign
pipeline treaty in a bid to avoid the shutdown of Minister Melanie Joly said her government
Enbridge’s 540,000 barrel per day (bpd) Line 5 had raised “serious concerns” over the poten-
pipeline for the second time in less than a year. tial disruption that could be caused if Line 5
The move comes in response to an attempt to was shut down.
shut down the pipeline in Wisconsin – which “This would impact energy prices, such as
Line 5 includes an is in addition to ongoing efforts by the State of propane for heating homes and the price of gas
underwater section Michigan to have it taken offline. at the pump. At a time when global inflation is
that Enbridge wants to The Bad River Band, a Native American tribe making it hard on families to make ends meet,
replace, though it has in northern Wisconsin, wants Line 5 to be shut these are unacceptable outcomes,” Joly stated.
run into opposition from down and removed from its reservation, citing The previous time that Ottawa invoked the
the State of Michigan. the risk of a leak and expired easements between 1977 treaty in relation to Line 5 was in Octo-
Enbridge and the tribe. Enbridge filed its own ber 2021, in a bid to start negotiations with US
motion in a US district court in May, seeking to to resolve the dispute with Michigan over the
have some of the Bad River Band’s claims dis- pipeline. Diplomatic talks have been limited, but
missed and arguing that federal law prohibits earlier in August, Enbridge won a court victory
attempts to stop the pipeline’s operations. against the State of Michigan when US District
Now Ottawa is also stepping in by invoking Judge Janet Neff agreed with the company that
the treaty, which guarantees the transmission regulation of Line 5 was a federal matter rather
of hydrocarbons between Canada and the US. than a state one.
INVESTMENT
ExxonMobil strikes deals to
offload non-core assets
US EXXONMOBIL continues its efforts to shed At the time, shale gas was booming and oper-
non-core oil and gas assets. Last week, it was con- ators were scrambling to acquire unconventional
firmed that the super-major had struck a deal to assets across numerous regions of the US. Since
sell its Fayetteville shale assets in Arkansas to Fly- then, commodity prices have gone through sev-
wheel Energy. Then, this week, it was reported eral ups and down, and many shale regions have
that ExxonMobil and Shell had separately agreed fallen out of favour as operators have focused on
to sell Aera Energy, one of California’s largest oil the most productive plays.
and gas producers, to international asset man- ExxonMobil disclosed plans to offer its
agement group IKAV. Fayetteville assets, and other non-core shale
The Fayetteville shale sale was reported by properties, up for sale in 2020 as it narrows its
Reuters, which confirmed the transaction with focus to the Permian Basin. It is also shedding
ExxonMobil. The company did not disclose the non-core conventional assets across Asia, Africa
value of the deal, but an ExxonMobil spokes- and Europe. Besides the Permian, ExxonMo-
woman, Julie King, told the news service that bil’s focus will be on areas offshore Guyana and
the sale advances the super-major’s strategy of Brazil.
focusing on “advantaged” assets. ExxonMobil also did not disclose the value
The assets covered by the sale agreement of its sale of Mobil California Exploration &
include around 5,000 natural gas wells – of Producing Asset Co. subsidiary, which owns
which about 850 are operated and roughly 4,100 a 48.2% stake in Aera Energy and a 50%
are non-operated. The sale also includes related share in Aera Energy Services. In a separate
pipeline and processing properties on around announcement, Shell said its own sale cov-
381,000 acres (1,542 square km). ExxonMobil’s ering its Aera stake was worth $2bn in cash,
shale unit, XTO Energy, acquired the assets in with additional contingent payments based
2010 for around $650mn. on future oil prices.
P6 www. NEWSBASE .com Week 35 01•September•2022
