Page 7 - EurOil Week 49

EurOil NEWSBASE’S ROUNDUP GLOBAL (NRG) EurOil

Oil market strategising

Policy decisions made this past week will have both long and

short-term ramifications for the wider energy sector

COMMENTARY WELCOME to the latest edition of NewsBase’s AfrOil: Offshore interest
Roundup Global (NRG), in which our team of In Africa, two major offshore projects have hit the
international editors provide you with a snap- headlines.
shot of some of the key issues affecting their Offshore Angola, BP has launched a new
regional beats. Get the NRG Oil & Gas Editor’s drilling programme at Block 18. The UK-based
Picks to your inbox every week for free. Just sign super-major is now using the Valaris DS-12 drill-
up here. ship to sink the first of four planned wells – includ-
Some of the biggest news this past week ing two development wells and two injection wells
revolved around policy decisions in the upstream – at the Platina section of the block. The company
space. The oil market was able to relax somewhat hopes to sees output at Platina peak at 34,000 bar-
following OPEC+’s decision to keep production rels per day (bpd) and will pump crude from the
cuts in place until the end of January. The impor- field to the Greater Plutonio floating production,
tance efforts to support oil prices was underscored storage and off-loading (FPSO) vessel, which it has
by Chevron’s announcement last week that it would installed at another section of the block.
cut its capital expenditure budget. BP had previously said it would begin drilling at
While production cuts will help balance one Platina in mid-2020 but was not able to meet that
side of the equation, a recovery in demand will be deadline. It is now on track to wrap up its drilling
essential to help prices to recover and as long as programme in late 2021.
uncertainty over when such a recovery will present Offshore Senegal, Australia’s Woodside Petro-
itself remains than other developers will likely fol- leum has blocked FAR Ltd, another Australian
low Chevron’s example. firm, from proceeding with plans to sell a minority
In the long-term, however, the upstream stake in the RSSD block to India’s ONGC Videsh
industry needs to prepare for a global transition Ltd (OVL). As the operator of the block, which
away from fossil fuels. The importance of such includes the Sangomar oilfield, it has exercised its
strategising was underlined by Denmark’s deci- right to pre-empt the sale and has offered to buy
sion to ban all new exploration in the North Sea, FAR’s stake on the same terms accepted by OVL.
while allowing its existing production projects to The move puts Woodside on track to boost its
remain in place. stake in the Sangomar field to 90% and its stake in
The move reflects a similar decision made last the other sections of the RSSD block to 82%. The
year by New Zealand, a much smaller hydrocar- company will be able to do so once it secures the
bons producer of and should give the wider oil and approval of shareholders and the government of
gas industry pause for thought. Senegal for its buy-outs of FAR and Cairn Energy,

Week 49 10•December•2020 www. NEWSBASE .com P7