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Asia: CNOOC’s gas pledge DMEA: OMV closes petchem deal
China’s state-run CNOOC Ltd has pledged to Austrian oil giant OMV has closed a $4.7bn deal
boost natural gas’ share of its overall production to buy an extra 39% stake in petrochemicals
by 2035 after announcing weaker third-quarter group Borealis from Abu Dhabi state investor
results on the back of falling crude oil prices. Mubadala.
“The step towards 1mn barrels requires a OMV already has a 36% interest in Borea-
work leap, so there will be risks and obstacles, lis, but a controlling share will provide it with
because what is being done is not business as greater say over the Ruwais complex in the UAE,
usual,” Indonesian language media outlet Kom- poised to become the world’s largest integrated
pas quoted him as saying during a November 2 refining and petrochemicals hub. The move also
webinar. fits with OMV’s strategy of growing its gas and
Soetjipto said the regulator would work with petrochemicals business while moving away
contractors to help improve their risk man- from crude oil sales.
agement and compliance and said SKK Migas Borealis is partnered at Ruwais with the
would serve as “a bridge” to help developers meet UAE’s state-owned ADNOC. The pair want to OMV has closed
their organisational goals. double the project’s production capacity to over
SKK Migas internal supervisor Taslim Yunus 9mn tonnes per year (tpy) by 2030. a $4.7bn deal
said: “Developing the upstream oil and gas Global demand for petrochemicals is begin- to buy an extra
industry with good governance and interna- ning to pick up again from lows experienced
tional standards is one of the keys to attracting earlier this year. Saudi Arabian producer SABIC 39% stake in
investors to a sector that has high business risk.” managed to return to profit in the third quarter,
The officials’ comments come, however, as following three quarterly losses in a row. petrochemicals
Indonesian oil and gas production continued to SABIC, which was recently bought by Saudi
slide in the third quarter on the back of depressed Aramco, attributed the latest results to the rever- group Borealis
energy prices, demand and investor interest. sal of impairments, higher prices and increased
Oil and gas lifting edged down 0.4% year on production. While conditions have improved,
year to 1.69mn barrels of oil equivalent per day the market is still oversupplied, though, and
(boepd) in the three months to September 30, this has prompted some operators to scale
SKK Migas data showed last week. Oil produc- back investment plans. Aramco and SABIC
tion amounted to 706,000 bpd, which was down announced earlier this month they were consid-
from the 745,000 bpd recorded in the same ering downsizing a $20bn oil-to-chemicals plant
period of 2019. in Yanbu.
The coronavirus (COVID-19) pandemic has In other news, Iran has been plagued by a
hit oil and gas contractors hard, as global quar- number of fires and explosions in recent months
antine measures have depressed energy demand. at mostly energy and military facilities. The latest
SKK Migas said in October it was working with blast occurred at a petrochemicals plant in the
several contractors with licences due to expire country’s south-west, owned by Bandar Imam
in 2022 to help them meet their work commit- Petrochemical.
ments despite the health crisis. SKK Migas’ act- These incidents are understood to be linked
ing head of communications, Susana Kurniasih, to the deterioration of Iranian infrastructure,
said exploration and enhance oil recovery (EOR) although there are suspicions that some are
work had been delayed across 13 blocks. security-related.

If you’d like to read more about the key events shaping If you’d like to read more about the key events shaping
Asia’s oil and gas sector then please click here for the downstream sector of Africa and the Middle East,
NewsBase’s AsianOil Monitor. then please click here for NewsBase’s DMEA Monitor.

Week 44 04•November•2020 www. NEWSBASE .com P7