11th November 2024

Good morning team. Here’s what hit the wires over the weekend in all things oil, gas, and energy:

• 🤡 Germany bashing

• 🚢 EU wants more US LNG

• 🐻 Russia’s Rosneft mega merger?

• 👋 Trump readying Paris agreement exit

• ➕ plus GoM ramping back up after Rafael; Israel / Hamas peace talks collapse; rig count stays flat; COP, again; rare cheer for UK E&P; ADNOC Ruwais LNG transfer; a US coal revival?; and barrels more.

Let’s take a look…

📈 THE NUMBERS

WTI slipped back below $70/bbl on expectations that Trump would be positive for US oil supply and keep Middle East aggression in check, reducing geopolitical risk.

🗞️ WELL-HEADLINES

 🗽 North America

• Biden gov’t makes it’s last SPR top up - the US government has bought a further 2.4 mmbbls of crude to top up the much-depleted SPR and said this latest purchase would be its last as it has now used up its allocated funds. Trump has said he'll keep refilling it.

• Ramping back up after Rafael - Shell, Chevron, and other operators in the GoM are returning staff to facilities after Hurricane Rafael, which took ~482 kb/d of oil and 310 mmcf/d of gas production offline last week.

• Rig count unmoved - another week, another flat line in the US oil rig count which has stayed at 479. Gas rigs were also unchanged at 102. US oil drilling activity has found a clear equilibrium in WTI prices of $65-$75/bbl.

• Pantheon drilling on Alaska’s North Slope - the company is targeting 609 mmbbls of prospective oil resources and 3.3 tcf of gas with its Megrez-1 well.

🏰 Europe

• EU starts grovelling to the US - European Commission President Ursula von der Leyen has said the continent should replace Russian LNG (yep, it still buys plenty despite a supposed ban) with US LNG. That didn’t take long for the Europeans to start trying to get into Trump’s good books…

• Russia’s Rosneft mega merger - the WSJ has reported that Russia is working on a plan to merge Rosneft with Gazprom Neft and Lukoil, which would create the world’s second largest producing oil company (behind Aramco), producing ~8 mmb/d. These rumours come around quite often so we’ll believe it when we see it.

• More cheer for UK exploration - in rare good news from the UK’s E&P sector, Petrogas has made a successful gas discovery with its Baker well in the North Sea. The find, which is the UK’s third success this year, was “significantly better than expected” although no resource estimates were shared.

🕌 The Middle East

• ADNOC Gas taking over Ruwais LNG - parent company ADNOC plans to sell a 60% operated stake in the 9.6 mtpa LNG project in Abu Dhabi to its gas subsidiary, for about $5bn in 2028. The plant will have one of the lowest carbon intensities in the world and is due online in 2028.

⛩️ Asia & Oceania

• Jadestone’s Akatara field struggling? - the company said its new onshore gas field in Indonesia was producing “intermittently”.

🦁 Africa

• Qatar farms into buys Chevron Egypt exploration - Qatar Energy has picked up a 23% interest in the offshore North El-Dabaa (H4) Block, operated by Chevron.

• Nigeria OKs Eni and Equinor sales - after months of delays, the companies have been given government approvals for their onshore exits from the country. IOCs have been leaving onshore Nigeria in recent years and selling to domestic companies as they struggle against challenges of security and theft.

🗿 Central & South America

• Arrow announces Colombia well results - the operator seems to have had some success with with its fifth horizontal well in the Tapir Block.

🌍 GEOPOLITICS & MACRO

• Israel / Hamas peace talks collapse - Qatar has withdrawn as the key mediator of the peace talks saying that neither side are negotiating in good faith to end the war in Gaza. Trump has made stopping wars a key priority of his so let’s see if he can walk the walk and succeed where Biden has failed when he gets in office in January.

💨 CARBON, CLIMATE, & OTHER ENERGY STUFF

• A coal revival in the US? - Duke Energy’s will reevaluate plans to convert coal power stations to gas in light of Trump’s victory and the AI driven surge in power demand. Trump has made clear his desire to support domestic energy and reduce energy bills, although the biggest threat to coal in recent years in the US has not been policy but ludicrously cheap natural gas.

• COP, here we go again - yet another tiresome UN climate summit kicks off today in Baku, Azerbaijan. As mentioned last week, many world leaders have bailed, but organizers hope some agreements on climate financing, carbon markets, and climate aid can be thrashed out.

• Trump prepping for Paris Climate Agreement withdrawal - the NYT has reported the president-elect has prepared plans to again remove the US from the agreement that sets emissions reductions targets for each country. The Paris agreement is non binding so a move like this is largely symbolic from the US’ point of view but the absence of the US will be a big blow to momentum and morale in the global environmental community.

• Kistos invests in tidal energy - UK-based E&P has taken a 20% stake in Spiralis Energy which is developing tech to harness tidal power using “fully recyclable, 3D-printed” equipment.

🛢️ BOTTOM OF THE BARREL

A little more Germany bashing as Europe’s windless spell continues:

It’s difficult to overstate how much of a mess Germany’s industry is in because of sky high power prices:

And they can’t even organise an election to vote their hopeless government out:

👋 BEFORE YOU GO

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Thanks for reading. Have a day out there. 🛢️🛢️

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