Page 12 - EurOil Week 46

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to the coronavirus (COVD-19) pandemic. Only GM) by 6%. This is versus RUB544bn of earn-
54 wells were drilled in the first 10 months of ings in the same period of 2019 and RUB170bn
the year, compared to 112 for the whole of 2019. in the second quarter of 2020. Its net loss was
Only six exploration wells were completed dur- also 7% less than the Moscow-based brokerage
ing the period, and it is possible there will be no projected.
more this year, OGUK said. Core earnings outperformed thanks to solid
The recovery will not happen overnight, the free cash flow (FCF), BCS GM said. This “con-
association has warned. It estimates that pro- firmed a significant recovery in the macroeco-
jects shelved during the downturn could take nomic environment for Russian oil producers,”
three years to be restarted, with around the it said. “We consider this to be a positive for the
same amount of time needed for investment to stock.”
rebound to pre-crisis levels. The drilling and rig Revenues totalled RUB1.44 trillion ($20.1bn)
companies needed to implement these projects in the three-month period, down 42% year on
are also in dire shape, OGUK said, noting that year but up 40% quarter on quarter. Oil prices
many were undergoing bankruptcy proceedings. slumped in March and April, only to recover in
All this undermines the UK North Sea’s the subsequent months, thanks to a recovery
competitiveness versus other basins, the asso- in fuel demand after historic lows during lock-
ciation continued, and highlights the need for a downs, as well as OPEC+ cuts to supply.
so-called North Sea transition deal to help oper- These cuts led Rosneft to reduce its overall
ators get through the downturn and develop hydrocarbon output by 9.5% in the first nine
cleaner energies. The government has said it will months of the year to 5.232mn barrels of oil
publish the deal within the current parliament, equivalent per day (boepd). This was led by a
but OGUK is hopeful that it will arrive shortly, 10% drop in oil and condensate output to 155mn
possibly by the end of the year. tonnes (4.14mn barrels per day).
In Norway, ConocoPhillips and its Polish UK oil and gas
partner PGNiG have made a “substantial” gas If you’d like to read more about the key events shaping
discovery in the Norwegian Sea, with an esti- the former Soviet Union’s oil and gas sector then please drilling is slated
mated size of between 8mn and 30mn cubic click here for NewsBase’s FSU Monitor .
metres (50-189mn barrels) of recoverable oil to fall this year
equivalent. GLNG: Projects moving forward to its lowest level
Conoco said it had found gas and condensate Various LNG projects around the world are tak-
at production licence (PL) 1009 after drilling a ing steps forward despite an increasingly chal- since the 1970s
wildcat well some 35 km from the Equinor-op- lenging market. Among those making progress
erated Heidrun oil and gas field, where Conoco in recent days is the Papua LNG project, which
has a 24% position. The discovery is also 27 km received a major boost last week after the Papua
south-west of the Aker BP-operated Skarv field, New Guinea (PNG) government passed six
in which PGNiG has a 11.9% stake. pieces of legislation that allow operator Total to
Conoco is the only US-based major left in proceed with the $20bn development.
Norway following the departure of Chevron in PNG Prime Minister James Marape said
2018 and ExxonMobil the following year. Its Total would send a delegation to the country in
main focus is the Greater Ekofisk Area, which the coming weeks for talks on how the project
consists of the Ekofisk, Eldfisk and Embla fields, would proceed, and talks are reportedly also
in the southern North Sea. planned with the other partners.
Conoco has a 65%interest in PL1009, while Elsewhere in the world, US-based Tellurian
PGNiG has 35%. The pair will “assess the results is reportedly in talks with unidentified Asian
of the discovery together with other nearby pros- buyers to sell almost half of its output from a
pects with a view to a potential development to proposed terminal on the Gulf Coast. Telluri-
existing infrastructure,” the NPD said. an’s planned Driftwood LNG facility was dealt
a blow this year when previous talks with India’s
If you’d like to read more about the key events shaping Petronet failed to result in a supply deal amid the
Europe’s oil and gas sector then please click here for global downturn in LNG demand and prices.
NewsBase’s EurOil Monitor . Last week, Tellurian’s chairman, Charif Souki,
told Bloomberg that his company had other
FSU: Rosneft returns to red potential customers interested in buying 12mn
The Russian oil giant Rosneft returned to a net tonnes per year (tpy) of output from Driftwood.
loss in the third quarter, on the back of ruble The facility would produce 27.6mn tpy in total if
devaluation and low prices. it goes ahead.
The company swung to its first net loss since According to Souki, the deals would be final-
2012 in the first quarter after sustaining heavy ised during the first half of 2021, with construc-
impairments but rebounded to profit in the tion on the terminal beginning in the middle of
second quarter. The company suffered another the year. He also said Tellurian would no longer
loss of RUB64bn ($800mn) in the third quarter, will employ memorandums of understanding
though, owing to a weaker ruble. This compared (MoUs) as a precursor to more in-depth talks,
with a RUB225bn profit a year earlier. after the failure of the company’s MoU with Petr-
Rosneft’s EBITDA performed better, arriving onet to lead to a firm deal.
at RUB366bn ($5bn) in the third quarter of 2020, For now, Total remains Driftwood’s only cus-
beating a forecast by BCS Global Markets (BCS tomer, so on top of Papua LNG progress, Souki’s

P12 www. NEWSBASE .com Week 46 19•November•2020