12th August 2024

Hello, hello, ladies and gents. Trust you had a top weekend. Here’s what hit the wires today in oil, gas, and energy:

• 🎉 US M&A party in full swing

• 💪 Ukraine pushes into Russia

• 🤑 Kazakhstan demands $160bn from IOCs

• ❌ Markets not ready for OPEC+ unwinds

• ➕ plus “fish hotels”; Tourmaline buys Crew; new high-pressure tech at Chevron’s Anchor; rare wildcats in the UKCS.

Let’s go…

📈 THE NUMBERS

European gas prices are climbing as Ukrainian troops seized a key gas transit hub in Russia.

🗞️ WELL-HEADLINES

 🗽 North America

• US M&A party still in full swing - 2024 is set to be another bumper year for US O&G M&A, and may even surpass 2023 for the number of deals. Q2 24 saw $30.2bn of deals announced, and several large deals have already been inked in Q3. The US shale patch is swimming is cash.

• Tourmaline splashes out on Crew - the all-stock deal is worth $950m and boosts Tourmaline’s presence in the Montney shale play in Alberta. Crew has production of ~30 kboe/d and 2P reserves of 473 mmboe.

• Chevron starts production at Anchor - the ultra-deepwater offshore field in the US GoM marks an industry first for the deployment of new high-pressure technology that is rated to safely operate at up to 20,000 psi.

• Path clear for Woodside / Tellurian - sources close to the deal don’t expect Woodside to have to contend with a rival bid for the troubled US LNG developer. In July, Woodside announced an agreement to buy Tellurian for $1.2bn as it seeks to become a “global LNG powerhouse”.

• Rig count climbs - the US oil rig fleet grew by 3 last week to 485, down 40 compared with this time last year.

🏰 Europe

• All eyes on rare UKCS wildcats - Harbour and Petrogas are gearing up to each drill an exploration well in the UK North Sea in the coming months. Only one other exploration well has been drilled in the country so far this year. Exploration activity is at rock bottom.

🕌 The Middle East

• No shortage of buyers for Iranian crude - despite US sanctions, Iran claims that it is selling oil to as many as 17 countries and that its production recently hit a 6 year high of 3.2 mmb/d. Keen to keep oil prices subdued, the White House is undoubtedly turning a blind eye to these sanction violations.

⛩️ Asia & Oceania

• Kazakhstan now demands $160bn from IOCs - the government is claiming that IOCs like Eni, Shell, Exxon etc have been involved in corrupt deals and financial mismanagement at the giant but complex ~400 kb/d Kashagan oil field, costing the country hundreds of billions in lost revenue. Expect legal proceeding for this to rumble on. The lawyers will be happy.

• New hope for Timor-Leste - Finder Energy has acquired a 76% operated interest in a group of offshore oil discoveries in Timor-Leste (it’s an island in Southeast Asia - I had to check too) that have laid undeveloped for years. Finder said it will need to farm down some of its stake to help fund development of the +100 mmbbls prospects.

🌍 GEOPOLITICS & MACRO

• Oil market not ready for returning OPEC volumes - the general consensus is that global oil demand is not yet high enough to warrant OPEC+ unwinding their production cuts later this year. Fears of a US recession will also be weighing on OPEC+ calculations, and the group will reportedly decide on their next move in the coming month.

• Ukraine pushes further inside Russia - Ukraine’s surprise incursion has advanced ~10km inside Russia and troops have taken control of a key Gazprom gas transit hub into Europe. Putin seems pretty angry about the whole thing and has promised a “tough response”.

💨 CARBON, CLIMATE, & OTHER ENERGY STUFF

• “Fish hotels” at offshore wind farms - developers of offshore wind farms are having to ensure their projects boost marine biodiversity in order to get regulatory approval. One proposal is the use of fish hotels which are cage-like structures that provide sanctuaries for small fish.

🛢️ BOTTOM OF THE BARREL

You’ve probably heard the line about 97% of scientists agreeing that climate change is going to spell doom for us all.

But do you know where that stat comes from and what it means?

Clue: it’s not what you’re led to believe…

👋 BEFORE YOU GO 

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

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