Shares in oil giant BP have increased by 0.5% on the back of reports its set to close a deal with Rosneft to develop fields in eastern Siberia. The potential agreement has been reported by Moscow-based newspaper Kommersant, which says that Rosneft has signed a "strategic partnership" with BP to explore oil fields.
A farm-out agreement between Chariot Oil and Gas and Woodside has been approved by the Moroccan Authorities. The company made the deal earlier this year with Woodside who committed to pay 100% of the 3D seismic acquisition and processing costs incurred across the licence by Chariot. A spokesman said a substantial part of the funds had been received bringing its estimated cash balance to $52million.
Billionaire Harold Hamm, whose early adoption of shale drilling in North Dakota helped usher in a US energy renaissance, plans to cut spending by 41% at his company after the plunge in oil prices. Continental Resources Inc. and other US producers can adjust quickly to the crude collapse and will be able to withstand the downturn better than many producing countries, which face economic “ruin,” Hamm said in an interview. “The oil and gas industry has lowered the cost of gasoline to consumers in this country,” Hamm, chairman and chief executive officer of Continental, said yesterday.
Fears have been raised that an emergency summit on North Sea oil will “fall flat on its face”. Aberdeen City Council Conservative group leader Ross Thomson yesterday voiced his “extreme disappointment” at the way Labour announced the event, with no details on its remit or venue. He has e-mailed other group leaders on the council calling for an a commitment to constructive talks.
Oil traded near the highest price in almost two weeks as the US economy expanded at the fastest pace in more than a decade, signalling fuel demand may increase in the world’s biggest consumer. West Texas Intermediate futures were down 0.6% in New York, paring a 3.4% gain yesterday. Gross domestic product rose at a 5% annual rate from July through September, the most since 2003, according to revised Commerce Department data.
Oil traders are poised to cash in on low crude prices by storing vast quantities of the commodity until prices rise. Global demand for supertankers is already growing as companies look to take advantage of the weakest oil prices in years. The price of a barrel of Brent crude has plunged nearly 50% since June due to a global supply glut but the economics for storing crude at sea have until just recently remained unfavourable.
The boss of Danish conglomerate A.P. Moller-Maersk has warned the group’s oil division will have to close some sites and cut operating costs if oil prices remain at their current level. Nils Smedegaard Andersen, chief executive, said that if prices stay around $60 per barrel, it will reduce revenue in the oil unit by one-third from the level of 2013. He added: “As all costs, except taxes, are fixed it is obviously something we have to take very seriously. And we would have to do some things.”
BP has claimed any gulf spill compensation payments by it should be less to reflect the oil price plunge. The oil giant is currently in a legal wrangle over what civil penalties it should make following the Deepwater Horizon rig disaster in 2010. The company said in legal filings before the final round of the case next month that penalties – which could beup to $18billion – would have a “very significant economic impact” on BP and its exploration and production business. BP claims any future ruling should take into account the fall in the oil price, the company’s clean-up efforts and the environmental improvement in the Gulf of Mexico.
Iraq’s cabinet approved a smaller 2015 spending plan than the government expected because of the collapse in oil, which provides most government revenue. The budget, based on a $60 a barrel price for oil, stands at 123 trillion dinars ($103 billion), Saad Al-Hadithi, spokesman for the office of the prime minister, said. The budget deficit was set at 23 trillion dinars and total revenue at 99.8 trillion dinars, including oil revenue of 84 trillion dinars, Obaid Mahal, deputy secretary general of the cabinet, said.
Lundin Petroleum has come up dry on a wildcat well at the Storm prospect in the North Sea. The company said it encountered hydrocarbons in the Cretaceous and Jurrasic reservoir sequences but not in “commercial quantities”. The wildcat well 33/2-1 on PL555 is located 200km north west of Floro on the Norwegian west coast and 65km from the Snorre field.
The force defending oil ports in eastern Libya pushed back an onslaught that Islamist militias had started 11 days ago to capture the facilities. “We pushed them back and it’s we who are now attacking them,” Ali al-Hasy, a spokesman of the Petroleum Facilities Guard, said by phone from Es Sider, Libya’s largest oil port. “The oil ports are safe and they suffered no damage. All the fighting took place well outside the ports.”
APR Energy said the suspension of operations in Libya will have an effect on its financial performance for the year. The company decided in November to temporarily suspend on going work in the North African country while it awaited final parliamentary ratification of the contract addendum signed by the customer and Ministry of Electricity in July. It said revenues for the year are expected to be $490million, offset by $30million which has arisen from the planned disposal of two turbines in Uruguay.
Score Group has unveiled plans to spend around £80million on new headquarters and other buildings in its home town of Peterhead. But a further plunge in oil prices could kill off the project, the company’s owner has warned. The proposals are at an early stage and no approach has been made to Aberdeenshire Council for planning approval.
Fighting in Libya that’s pushed oil production below consumption in the holder of Africa’s largest reserves is a reminder that not all OPEC members are in a position to defend market share by maintaining output. As Iraq plans to boost supplies next year amid repeated pledges by Saudi Arabia and the United Arab Emirates to keep pumping the same amount of crude, Libya’s National Oil Corp. said output has dropped to a “very low point.” Conflict between the government and Islamist militias has spread to the region of Mellitah, where the country’s fourth-largest oil port is located, after disrupting two other export terminals, according to the state-run company.
The former head of BP’s Aberdeen-based North Sea operation warned yesterday the UK oil and gas industry is facing an early death unless there is swift political action to prevent it. Dave Blackwood, who retired from BP in 2009 and is currently a non-executive director with Granite-based energy service firm Expro Group, was speaking as reports in Saudi Arabia said the kingdom was prepared to increase its oil output and claim a bigger global market share, potentially putting further pressure on the UK industry after the oil price slump of recent months. Adding his voice to widespread calls for swift tax cuts for North Sea operators, Mr Blackwood said: “Nothing less than radical change will prevent the premature demise of the basin, let alone maximise economic recovery.”
Aberdeen firm Craig Group said ongoing investment in tonnage and new international bases helped drive a big jump in both profits and turnover during the year to April 30. The privately owned, family-run shipping and energy service company has just filed accounts showing pre-tax profits increased to £20.5million, from £17.3million, while turnover grew by more than £30million to £177.7million. They also highlight almost £30million of capital expenditure during the year, of which £23.3million was spent on the continued modernisation of the group’s growing fleet of emergency response and rescue vessels.
The SNP has been accused of “deceiving” voters in September’s referendum after analysis suggested an independent Scotland would have received only a fifth of the party’s oil revenue estimates. According to reports projections from the Office for Budget Responsibility (OBR) which take into account plummeting prices put oil revenues at £1.25 billion in 2016/17 - the first year of independence had Scotland voted Yes - instead of the £6.9 billion predicted by the Nationalists during the campaign. Meanwhile oil giant Shell confirmed it is to sell its share in the Sean gas field in the southern North Sea.
BP and SOCAR (The State Oil Company of the Republic of Azerbaijan) have signed a new production sharing agreement to explore shallow water prospects in the Absheron Peninsula. The agreement is part of the government’s plan to ensure that all of Azerbaijan’s offshore areas are fully explored. A deal was signed by Rovnag Abdullayev, president of SOCAR, on behalf of the government of the Republic of Azerbaijan, and Gordon Birrell, BP’s regional president for Azerbaijan, Georgia and Turkey. Mr Birrell said: “BP is proud to embark on this new era of exploration in the Caspian together with SOCAR.
Libya’s oil output fell below its own consumption as fighting spread to Mellitah, a region that hosts the country’s fourth largest oil port, the state petroleum company said. National Oil Corp. already this month declared force majeure at two export terminals, Es Sider and Ras Lanuf, after an attempt by Islamist militias to capture them. Force majeure is a legal status that protects a company from liability when it can’t fulfill a contract for reasons beyond its control.
Gulfsands Petroleum is one step closer to finding its first gas in Morocco as work progresses on operations. Production has started on the Dardara Southeast 1 (DRC-1) Rharb Centre Permit in Northern Morocco using the COFOR SAS Cabot 750 rig. The DRC-1 well is the second well to be drilled based on the interpretation of 3D seismic survey data shot by Gulfsands on the Rharb Centre Permit in 2013.
Oil and gas exploration company Circle Oil has confirmed a discovery in Morocco. The Middle East and North Africa focused firm has found oil in the KSR-12 well in the Sebou Permit. The well is located about 1.2 kilometres to the south-west of the KSR gas gathering station. It was drilled to a total depth of 1,980 metres measured depth.
OAO Rosneft (ROSN) repaid $7 billion in debt and said it is generating enough dollars to meet the obligations taken on to buy TNK-BP last year and become the world’s largest traded oil producer. The state-led company, hit by sanctions on Russia from the US and European Union limiting access to capital markets, said it has settled $24 billion this year in line with credit agreements. Rosneft has sufficient foreign currency to cover debt, Chief Executive Officer Igor Sechin said in a statement.
Oil producer Afren has seen a boost in its shares following a preliminary offer from Seplat Petroleum Development. The company’s shares rose 10.5% on the London Stock Exchange to 50.82pence. The company’s shares rose 10.5% on the London Stock Exchange to 50.82pence.
The Scottish Secretary Alistair Carmichael said he will attend a North Sea oil summit organised by Aberdeen City Council. The meeting has been called by Aberdeen City Council in response to a plunge in oil prices to just above $62 a barrel, from more than $100 in the summer. Scottish Labour pledged to send its leader, Jim Murphy, and urged both Mr Cameron and Ms Sturgeon to attend. Alistair Carmichael will attend the summit as well as the Scottish Lib Dem leader Willie Rennie.
CNOOC’s Nexen unit has shutdown its operations at an oilfield in Yemen due to a security threat. The company made the move because of safety fears related to terrorist group Al Qaeda.