13th February 2024

• 😞 Tragedy in Trinidad

• 🕵️ Norway’s spies on edge

• 💎 Diamondback’s post merger plans 

• ⚖️ US sued from all angles

• ➕ plus Russian tankers feeling the heat; big bounty in Namibia; oil demand marches on; EU carbon price falling sharply.

Here goes…

📈 THE NUMBERS

🗞️ WELL-HEADLINES

 🗽 North America

• What next for Diamondback and Endeavor after mega merger - the $50bn deal between the two Permian heavyweights has been announced, with executives saying the focus will be on efficiencies rather than growth. The deal is expected to generate $550m per year in synergies and combines top tier acreage in the Permian. The market certainly likes it: Diamondback’s share price ripped 10% on the news. Meanwhile, Endeavor’s founder Autry Stephens is set to become the wealthiest oil man in the country with a net worth of $26bn.

• US government getting sued from both sides - the US oil industry and environmentalists are suing the US government for its oil lease plans in the GoM. The oil industry is suing because the government has cut the acreage on offer, while the green lobby is suing because the government is offering any at all! If you try to please everyone, you’ll please no one…

• Shale output to edge up in March - the EIA sees oil production growth from the top shale regions climbing by 20 kb/d in March to 9.7 mmb/d, it’s highest level since December. It’s all eyes on US shale this year as expectations are that its rapid growth might finally be slowing. Let’s see…

🏰 Europe

• Sanctions are choking Russian tankers - at least two dozen tankers that Russia usually uses to deliver oil have stopped operating since the US sanctioned them in October. One tanker performed a U-turn off the coast of Portugal last week when its owner was named by the US. It was sailing towards a Russian port in the Baltic Sea at the time.

• Norwegian spooks concerned about threat to energy assets - as Europe’s dependence on Norwegian oil & gas supplies increases, so too does the security risk to the country’s energy assets, according to one of Norway’s intelligence heads. Hmmm I wonder what threat he’s referring to exactly…

• Johan Sverdrup hitting its peak - one of Norway’s largest ever oilfields is set to hit max production this year of ~755 kb/d. This equates to ~7% of Europe’s entire daily oil consumption. The 3 bnbbls field, named after a former prime minister, started up in 2019.

⛩️ Asia & Oceania

• Bidders for Macedon and Greater Pyrenees revealed - Jadestone has confirmed it’s participating in the process to acquire Woodside’s interests in the large Australian gas fields that produce ~28 kboe/d (net). Hibiscus and Carlyle are also rumoured to be involved in a deal that will be worth several hundreds of millions.

• Russia wins $500m suit against PetroVietnam - Russian power equipment manufacturer, Power Machines, was suing PetroVietnam to reclaim funds invested into the construction of a power plant in Vietnam, a project that was halted in 2018 after Power Machines was placed under US sanctions.

• Strike Energy shares sink after well problem - the Australian company lost ~31% of its value after announcing problems at a key gas well.

🦁 Africa

• “Very encouraging” results for Galp in Namibia - more good news coming from the emerging offshore hotspot. Galp said its latest well at the Mopane prospect indicates a “sizeable” find. Galp will make an estimate on resources by the end of March, but its local partner has suggested Mopane has the potential for a whopping 10 bnbbls of oil in place (something Galp has downplayed).

🗿 Central & South America

• T&T declares national emergency over oil spill - an upturned tanker of unknown origin is leaking oil into the sea off the coast of the Trinidad & Tobago. Mysteriously, the vessel made no distress calls and there is no sign of any crew. The leak had not yet been contained and is having disastrous impact along the pristine coastline.

• Carlos slim plans more oil investments - Mexico’s richest man is increasing his stake in Talos Energy and wants to make further oil & gas investments. Slim currently holds ~22% of Talos which is developing the large 735 mmboe Zama field in the Gulf of Mexico.

🌍 GEOPOLITICS & MACRO

• Aramco sees “robust” oil demand growth in 2024 - the world’s largest oil company expects growth of ~1.5 mmb/d this year, which is roughly halfway between the OPEC and IEA estimates. Oil demand marches on.

• US pushing for Israel / Gaza peace deal - Biden and Middle Eastern leaders are trying to broker a 6-week ceasefire as the violence continues in the Gaza strip. Concerns are mounting about the impact on civilians of an impending Israeli offensive on the southern city of Rafah where nearly half of Gaza’s population have fled to to avoid the fighting.

💨 CARBON, CLIMATE, & OTHER ENERGY STUFF

• EU carbon price keeps falling - at €58/tonne it’s now at its lowest level since 2021, having breached €100/tonne in March last year. On one hand this signifies lower carbon emissions but, on the other, the primary driver for lower demand for carbon credits is reduced European industrial activity, which is a worrying trend.

🛢️ BOTTOM OF THE BARREL

👋 BEFORE YOU GO 

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