Page 11 - EurOil Week 49

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national oil company (NOC), over the terms of through the creation of Energy Development
a 20-year ethane supply deal. Mexican President Oman (EDO), a new company that will seek to
Andres Manuel Lopez Obrador has come down tap international debt markets backed by the
on the side of the state-owned companies, and country’s largest oil concession, Block 6.
some industry observers believe that the gov-
ernment sees recent developments as a means of If you’d like to read more about the key events
forcing Braskem Idesa to sign new contracts that shaping the Middle East’s oil and gas sector then
are more favourable to both Cenagas and Pemex. please click here for NewsBase’s MEOG Monitor .
In related news, Mexico’s government is on
track to collect about $2.5bn this year as a result NorthAmOil: Chevron cuts capex
of its annual oil price hedging deal. The 2020 Chevron followed rival super-major ExxonMo-
hedge, which expired on November 30, locked bil in announcing a cut to its capital expenditure
oil prices in at $49 per barrel. This was a fortu- budget last week. This comes as both large and
nate move, given the depths to which world small producers are looking to 2021 – and beyond
crude prices sank earlier this year. Prices for – and independents can be expected to follow the
Maya crude, Mexico’s main export grade, sunk super-majors’ leads in announcing scaled-back
briefly below zero in April and even now are only spending plans over the coming weeks.
at around $40 per barrel. Chevron said on December 3 – three days
after ExxonMobil’s capex plans were unveiled
If you’d like to read more about the key events shaping – that its 2021 capital and exploratory spending
the Latin American oil and gas sector then please click programme would total $14bn. It added that
here for NewsBase’s LatAmOil Monitor . its longer-term capex guidance over 2022-25
was $14-16bn. This is down from a previous
MEOG: OPEC+ agreement projection of $19-22bn, with Chevron unveil-
The oil market sighed with relief this week when ing 2020 capex guidance of $20bn this time last
it was announced that OPEC and its partners year before subsequently scaling back its plans
had agreed a deal to maintain 7.2mn bpd of cuts after the oil and gas industry entered its latest
until at least the end of January with monthly downturn.
meetings to decide increases going forward. The super-major said it would continue to
However, the friction between key OPEC prioritise investments that are “expected to grow
members Saudi Arabia and the UAE that caused long-term value and deliver higher returns and
the group to delay their meeting with non-OPEC lower carbon”. It added that this would include
partners has not gone unnoticed. Riyadh had over $300mn worth of investments aimed at
been keen to maintain the previous 7.7mn bpd advancing the energy transition in 2021.
cuts for a further three months in order to max- Chevron said it expected to increase invest-
imise market stability and prop up prices, but the ment in various “advantaged assets” over the
UAE said it would only support a continuation of coming years, including the Permian Basin,
reductions if non-compliers were forced to toe other unconventional plays and the Gulf of Mex-
the line. While a compromise has been reached, ico. Some parallels can be drawn between Chev-
it is likely to have fallen short of the levels the ron and ExxonMobil here, with the latter also
UAE would have hoped for with ramping up saying it would prioritise spending on a handful
production, an important element in its efforts of assets including its operations in the Permian.
to make its Murban crude grade a benchmark But Chevron appears to have more a focus on
for the commodity. its entire US portfolio, which now includes the
Iraq will play a particularly important role assets it acquired through its merger with Noble
in the success of the latest deal, with the coun- Energy earlier this year.
try the most flagrant offender when it comes to Other announcements of capex cuts, albeit
non-compliance. Meanwhile, Total is reported to on a smaller scale, are set to follow across the US
have taken steps to sell off a non-core asset in the oil and gas industry.
Kurdish north of the country, with the Sarsang
block apparently being marketed by Jefferies. If you’d like to read more about the key events shaping
OPEC+ member Oman has concerted efforts the North American oil and gas sector then please click
to reinvigorate the sultanate’s oil and gas industry here for NewsBase’s NorthAmOil Monitor .™

Week 49 10•December•2020 www. NEWSBASE .com P11