16th April 2025

Morning all. Here’s what’s going down in all things oil, gas, and energy.

• 🔮 Predicting peaks

• 🐲 China turns to Russia

• 🏁 Calcasieu Pass finally starts commercial ops

• 🇰🇪  Tullow exits Lokichar

• ➕ plus no luck in Cyprus; lifeline for US coal plants; USECD in Permian buy; Total’s Rio Grande deal; One Guyana ready for action; Jadestone leaves Thailand; Russia’s thinking long term; Russian gas back to Europe?; and barrels more…

Buckle up.

📈 THE NUMBERS

🗞️ WELL-HEADLINES

 🗽 North America

• Venture starts commercial ops at Calcasieu Pass - after a three-year commissioning process that is the subject of an ongoing feud between Venture and its long-term customers, Venture has now begun shipping LNG cargoes to these customers (conveniently just as global gas prices fall...).

• Predicting peaks - the EIA estimates that US oil output will peak in 2027 at ~14 mmb/d (vs 13.7 mmb/d today) and decline to 11.3 mmb/d by 2050, as US shale growth runs out of steam. Gas demand, meanwhile, has got further to climb, and isn’t expected to peak until 2032 at 92.4 bcf/d (vs 90.5 bcf/d today). With electricity demand growing as it is, I’d wager than gas demand will go substantially higher than that.

• USEDC makes big Permian buy - U.S. Energy Development Corporation has acquired ~20k net acres of producing and non-producing assets in Texas that it says are worth $390m. The name of the seller wasn’t disclosed.

• Total gets in on the Rio Grande act - a few days after Aramco announced a large supply deal with the under-development LNG facility in Texas, TotalEnergies has announced a similar agreement involving 1.5 mtpa of LNG over 20 years from the planned Train 4.

🏰 Europe

• Russia holding steady for decades - the country’s latest long-term energy strategy plans to produce ~10.8 mmb/d of crude in 2025, almost identical to what it produces today. It expects gas production, however, to nearly double in that time period from 637 bcm to 1107 bcm.

• No luck in Cyprus - Exxon’s closely watched offshore Elektra exploration well was deemed noncommercial. Cyprus was hoping the well would mark the beginning of a new age of energy riches. Bummer.

• Russian gas back to Europe? - maybe some, suggests TotalEnergies CEO: “Europe will never go back to importing 150 bcm from Russia like before the war ... but I would bet maybe 70 bcm,” he said, “we need to diversify, many routes, not over-rely on one or two”.

🕌 The Middle East

• Nothing going on here.

⛩️ Asia & Oceania

• China swapping US LNG for Russian - China’s ambassador to Russia has said that it will import more Russian LNG this year as it cuts the amount of US LNG imports due to tariffs. The two countries have also been discussing plans for the proposed giant 50 bcm Power of Siberia 2 pipeline which have stalled due to disagreements over terms. Interestingly, with US gas becoming more expensive for China, Russia suddenly has a bit more leverage in those negotiations.

• Indonesia promises $10bn of US energy buying - in an attempt to get the 32% US tariffs removed, Indo has said it will buy additional oil and LPG from the US. Other Asian countries like Pakistan, South Korea, Thailand, and India are all looking at similar measures.

• Jadestone leaves Thailand - the SE Asia indy has sold its 9.5% stake in Thailand’s producing Sinphuhorm gas field to PTTEP for $35m.

• Conoco cancels Salam-Patawali - development of the offshore Malaysia field has been axed as part of the company’s country strategy review.

🦁 Africa

• Eni spending big on Zohr - the Italian major is planning to invest $360m next year into two new wells at its giant 1.5 bcf/d Zohr gas field offshore Egypt. Those are some expensive wells. Eni is currently drilling two other wells at the field, at an estimated cost of $160m.

• Tullow sells Kenyan assets - after opening up the onshore Lokichar basin in Kenya back in 2012, Tullow has now left it after selling its position to Gulf Energy for $120m.

🗿 Central & South America

• One Guyana FPSO set for installation - Exxon and its partners are about to deploy their fourth FPSO in the country’s waters at the Yellowtail and Redtail fields, taking the group’s total capacity up to 940 kb/d.

🌍 GEOPOLITICS & MACRO

• Revising down demand - both OPEC and the IEA are reducing crude demand growth estimates over the next two years, citing the impact of trade wars on economic growth. OPEC now reckons demand will grow by 1.3 mmb/d this year (down 0.15 mmb/d from last month’s estimate) and by 1.3 mmb/d in 2026 (also down 0.15 mmb/d). The ever-bearish IEA is calling 0.7 mmb/d of growth in 2025 (-0.3 mmb/d) and the same in 2026.

• And oil price forecasts - funny how revisions to oil price forecasts always follow actual oil price changes, rather than the other way around. Anyway, various orgs have updated their estimates: the EIA expects Brent to average $68/bbl this year (vs previous estimate of $74/bbl), Goldmans is now at $63/bbl for 2025, and JP Morgan forecasts $66/bbl. No one has a clue where oil prices are going so take that with a big pinch of salt.

💨 CARBON, CLIMATE, & OTHER ENERGY STUFF

• Trump lightens the load for coal plants - 47 coal companies in the US are being exempted from regulations that curb mercury and air toxics for their power plants. Trump has stated his desire to support the ailing US coal industry.

• Capital Power spends $2.2bn on gas power plants - the Canadian firm purchased the two power stations in the PJM market from LS Power Equity Advisors.

🛢️ BOTTOM OF THE BARREL

👋 BEFORE YOU GO

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

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