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- 8th December 2023
8th December 2023
Canadaâs âde facto production capâ | Vision 2030-something | Unlocking Permianâs gas riches | Woodside and Santos merger headwinds

Goooood morning. Hereâs Both Barrels with your final wrap up of the week:
đ¨đŚ Canadaâs âde facto production capâ
đ Vision 2030-something
đď¸ Unlocking Permianâs gas riches
â Woodside and Santos merger headwinds
â plus the latest from the Venezuela / Guyana border; Shell committed to Nigeria; anti-LNG clowns.
Have a great weekend everybody. See ya Monday.

đ THE NUMBERS

As of 05:00 ET on 08/12/2023. N.B. prices for JKM LNG and uranium can be delayed by a day or two.

đď¸ WELL-HEADLINES
đ˝ North America
Industry balks at Canadaâs cap and trade - the proposed new system will require Canadian O&G producers to reduce their emissions by 38% in just 6 years. An industry body has warned the plans were tantamount to a forced production cut, while the opposition Conservative party, leading in the polls, said the cap was an attack on âCanada's world-class energy industryâ.
Exxon delays Golden Pass LNG start - the 18.1 mtpa facility was due to fire up late next year, but is now expected online in H1 2025. Exxon, which owns the project with QatarEnergy, didnât give a reason for the delay.
New Permian gas export capacity onstream - Kinder Morganâs 550 mmcf/d expansion of its Permian Highway Pipeline is up and running. Permian gas output has been surging, lots of which is associated gas, but takeaway capacity hasnât kept pace, creating gluts and sometimes pushing local gas prices at the Waha Hub negative.

The Permian is swimming in gas

But the challenge is getting it to market
đ° Europe
Edisonâs Italy gas storage assets catch a few eyes - various domestic and international players are understood to have made offers of over âŹ600m for Edisonâs three gas storage sites in Italy. Last yearâs energy crisis served as a reminder of the importance - and value - of gas storage, so itâs no wonder these assets have attracted some suitors.
Fault shuts Shetland Gas Plant - itâs unclear when Totalâs facility in the UK will restart operations. A failure in a heating system caused the release of a large quantity of steam which could be seen from miles away.
âŠď¸ Asia & Oceania
Woodside Santos merger hurdles - itâs expected that the possible merger between the two Australian O&G heavyweights would face domestic anti-trust pressure, forcing the sale of assets. The price that Woodside would be willing to pay, or not pay, is also likely to create some headwinds for the deal. Santosâ shares up are up ~6% since the news broke.
BP and AKR to develop East Java LNG import terminal - the project is due onstream in ~2027 and is set to coincide with the start-up of many gas-consuming projects in the region.
PTTEP reveals three âremarkableâ discoveries - the oil & gas discoveries were made offshore Malaysia, close to the companyâs large Lang Lebah gas field.
đŚ Africa
Invictus Energy discovers gas in Zimbabwe - Exxon abandoned exploration activity in the country back in the 1990s but Invictus used Exxonâs data to help discover âthe large potential of the Mukuyu fieldâ. The companyâs shares jumped nearly 30%.
Shellâs $6bn Nigeria commitment - the company announced plans to invest $5bn in the offshore Bonga North oil project and a further $1bn to develop Nigeriaâs gas industry. Shell has a long and chequered history in Nigeria where it has been operating since 1937.

đ GEOPOLITICS & MACRO
Vision 2030-something - Saudi Arabia has admitted for the first time that some of the projects in its ambitious flagship Vision 2030 economic transformation plan will be delayed. The kingdomâs finance minister cited needing more time to build factories and human resources. All the money in the world canât stem the flow of time. A wise lesson for life more broadly, I suppose.
The latest on Venezuela / Guyana:
Brazilâs President Lula expressed âgrowing concernâ about the situation. "If there's one thing we don't want here in South America, it's warâ. Brazil has been increasing its military presence along its border with Venezuela.
The US military is upping its operations with the Guyanese army. Thatâs not a good signâŚ
Venezuela has issued arrest warrants for 13 individuals it accuses of being agents of Exxon and who tried to disrupt its referendum on the weekend. Unsurprisingly, many of those named are part of an opposition presidential candidateâs team.

đ¨ CARBON, CLIMATE, & OTHER ENERGY STUFF
âGreenâ groups at COP call for LNG restrictions - over 200 orgs released a letter at COP to US President Biden to halt support for the LNG industry. I suppose theyâd rather we all use coal, or maybe just not bother with heating at all this winter? These are not serious people. They think they have the moral high ground but their policies would be devastating for hundreds of millions of the worldâs poorest.
US to vote on Russian uranium ban - Russia is the number 1 supplier of enriched uranium used to fuel the USâ 90+ commercial nuclear reactors. But the US House of Reps will soon vote on whether to ban imports of the stuff in light of Russiaâs invasion of Ukraine.

đ˘ď¸ BOTTOM OF THE BARREL
Imagine putting this detour into your satnav:
Argus: An Aframax tanker hauling crude from Mexico's west coast to the US Gulf coast has sailed around South America to avoid record-long wait times at the drought-stricken Panama Canal.
â Ed Finley-Richardson (@ed_fin)
10:05 AM ⢠Dec 7, 2023
We wonder why it takes so long to build anything in Europe:
Enjoyed this visual from a recent talk at #COP28, showing the amount of documentation required for permitting 3 new wind turbines
â Mike Hemsley (@mikehemsley)
9:27 AM ⢠Dec 7, 2023
Aaaaand, finally, it wouldnât be a normal week without some bad news from the poster boy of how-not-to-do-an-energy-transition, Germany:
CHART OF THE DAY: The collapse of the energy-intensive industry in Germany deepens, with Sept 2023 setting a new low, according to official data released today.
For background, read this @opinion column on the death of the European petrochemical industry: bloomberg.com/opinion/articlâŚ
â Javier Blas (@JavierBlas)
1:58 PM ⢠Dec 7, 2023

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