Page 18 - AsianOil Week 31

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sink one well at the Sloanea section of the block Quarterly losses mount in North America
and will probably begin drilling in the fourth Second-quarter losses being announced by
quarter of this year. Equity in Block 52 is split North American producers have continued to
50:50 between Petronas and ExxonMobil (US), pile up in recent days. Virtually no company is
which is already a major player in neighbouring expected to emerge unscathed from the quar-
Guyana’s offshore zone. ter, which likely saw the worst of the oil and
In other news, the Energía Costa Azul LNG gas downturn.
project is still on hold. California-based Sem- Notable names joining the growing ranks
pra Energy and its Mexican subsidiary IEnova of those reporting second-quarter losses over
had hoped to take a final investment decision the past week have included ConocoPhillips,
(FID) on the scheme by the end of June but are the US’ largest independent producer. On an
still waiting for Mexico’s government to issue an adjusted basis, excluding special items, the
export permit. Company executives say they are company posted a loss of $1.0bn compared
still optimistic about pushing the project for- with an adjusted profit of $1.1bn in the same
ward soon, even though Mexican government quarter of 2019.
bureaucracies are operating more slowly because US-based super-majors ExxonMobil and
of the coronavirus (COVID-19) pandemic. Chevron also posted rare losses, which reached
$1.1bn and $8.3bn respectively. For ExxonMo-
If you’d like to read more about the key events shaping bil, this was the second consecutive quarterly
the Latin American oil and gas sector then please click loss after decades of profits. Chevron’s loss,
here for NewsBase’s LatAmOil Monitor. meanwhile, was its largest in recent history,
exacerbated by $5.6bn worth of oil and gas pro- Oil production
Mideast: Gulf OSPs to drop as output rises duction write-downs. Canadian producers were
Oil production from OPEC member countries not spared either, with Imperial Oil, ExxonMo- from OPEC
has increased by 1mn barrels per day (bpd), as bil’s subsidiary north of the border, and Husky
producers in the Gulf are stepping back from Energy among those reporting second-quarter member states
their extra voluntary output cuts. losses over the past week.
As production has increased, there is grow- However, some bright spots also emerged, has increased by
ing speculation that Saudi Aramco and ADNOC as US oil prices continued to hold steady above 1mn bpd
will cut their official selling prices (OSPs) for $40 per barrel and a number of the companies
crude cargoes to Asia loading in September as reporting their results also said they were in the
they seek to continue efforts to increase mar- process of restoring output they curtailed during
ket share. Saudi OSPs will set the trend for the the second quarter.
month’s prices throughout the Gulf, so much will Among these was ConocoPhillips, which
depend on what happens in the next day or two. said it expected to have most of its curtailed
As producers turn the pumps back on, output restored by the end of September, hav-
Kuwait Oil Co. (KOC) is preparing a tender ing cut about a third of its production in April
for 24 new rigs to help achieve the country’s and recently started ramping it back up. And
ambitious crude output capacity targets. The in Canada, Husky said it had the capacity to
news follows our recent coverage of produc- ramp up production over the course of the
tion ramping up to 75,000 bpd at the Lower current quarter.
Fars Heavy Oil Project and the departure of In other welcome news, the total US rig
the first cargoes of crude. count stayed flat in the week up to July 31,
Meanwhile, news emerged this week that having declined for the previous 20 weeks. The
Occidental Petroleum was in advanced talks loss of one active oil rig was offset by the addi-
with Pertamina over the sale of assets in Ghana tion of a gas rig. The rate of rig count declines
and the UAE. The US firm has been considering has slowed in recent weeks, but while market
asset divestments to ease its debt burden follow- conditions are improving, producers may be
ing the $37bn acquisition of Anadarko last year. hesitant to ramp up new drilling too quickly.

If you’d like to read more about the key events shaping If you’d like to read more about the key events shaping
the Middle East’s oil and gas sector then please click the North American oil and gas sector then please click
here for NewsBase’s MEOG Monitor. here for NewsBase’s NorthAmOil Monitor.™

P18 www. NEWSBASE .com Week 31 06•August•2020