21st August 2024

Gooooood morning. Here’s your daily dose of all things oil, gas, and energy:

• 🇦🇺 Australia’s vanity project

• 🔥 What a $200m fire looks like

• 💰 Quantum bags Caerus for $1.8bn

• 🥶 Shivering Brits

• ➕ plus China’s nuclear frenzy; Trump’s renewable clean out; Mount Etna’s carbon taxes; APA up for sale; a milestone for Italy’s offshore O&G; strong FPSO market fundamentals; and plenty more.

Let’s rip…

📈 THE NUMBERS

🗞️ WELL-HEADLINES

 🗽 North America

• Quantum bags Caerus for $1.8bn - Caerus operates over 7,400 producing wells in Colorado and Utah, with 2P gas reserves of 15.2 tcf, and gas production of ~600mmcf/d. Caerus says it aims to be “the Rocky Mountain region’s most efficient producer of sustainable, affordable natural gas”.

• APA looking for $1bn Permian sale - APA owns the assets through its Apache subsidiary and is looking to raise proceeds to reduce the debt it took on when it acquired Callon earlier this year. The portfolio produces ~22 kboe/d across the Permian Basin.

🏰 Europe

• i3 Energy shares up 34% on takeover approach - Gran Tierra Energy has made an offer to buy the UK-listed O&G producer for $225m, at a hefty 49% premium to its August 16th closing price. i3 Energy has assets in Canada and the UK with production of ~18 kboe/d.

• Shivering Brits - pity us! 25% of Brits are so worried about rising energy bills this winter that they are considering not using their heating. Welcome to 2024 in “Great” Britain.

• Huge Russian fuel depot up in flames - at least 20 of 74 fuel storage tanks at a depot in Russia are on fire after an attack by Ukrainian drones. Over 500 firefighters are tackling the blaze which has spread across 10,000 square meters.

• Italy’s ‘most important’ gas project goes live - Eni says that production from the Argo Cassiopea field in the Strait of Sicily is carried out entirely underneath the sea, with no visual impact and near-zero emissions. The field was developed in just 3 years and is due to hit peak production of 1.5 bcmpa of gas.

🕌 The Middle East

• Saudi’s Bahri drops $1bn on new tankers - the country’s national shipping company has ordered 8 new VLCCs. Bahri operates one of the largest fleets of VLCCs globally, and currently manages 39 vessels, each with a capacity of 2.2 mmbbls.

⛩️ Asia & Oceania

• “Very healthy demand and limited supply" in FPSOs - Malaysia-based FPSO specialist is optimistic about the future and sees plenty of demand for the vessels in the years ahead. With booming offshore regions like Brazil, Guyana, Namibia, and Suriname, the outlook is rosy for the offshore O&G sector.

🦁 Africa

• NNPC making it rain - Nigeria’s NOC banked a record annual profit of $2.1bn in 2023, in large part thanks to a reduction in a government fuel subsidy. The company was first formed in 1977 and didn’t become profitable until 2020. Not great but, to be fair, operating an oil company in Nigeria can’t be easy…

• Niger and Benin kiss and make up - the two countries resolved a border dispute that has shut off crude exports from landlocked Niger since June. The new flagship 110 kb/d pipeline is operated - and was financed by - China’s CNPC.

• Ghana breaks ground on $12bn petroleum hub - construction has started at the facility that is set to transform the country’s oil & gas sector, and which will include a a 300 kb/d refinery, petrochemical plants, and other infrastructure.

🌍 GEOPOLITICS & MACRO

• Trump pledges to half US energy costs - he plans to do this by reducing EV tax credits, by “building dozens and dozens of power plants”, rolling back wind and solar support, and supporting domestic O&G production. His Democrat opponents are waging “regulatory jihad to shut down power plants”, he said.

💨 CARBON, CLIMATE, & OTHER ENERGY STUFF

• China greenlights 11 new nuclear reactors - the total investment is expected to be $31bn and the reactors are due to be completed within the next five years. In the UK it takes $30bn and 20 years to build one nuclear power station…The problem is not technology, it’s bureaucracy and needlessly stringent, crippling regulation.

• Solar from Aus to Singapore - the Aussie government has given the go ahead for a $13.5bn 6 GW project that will export solar 4,300 kms to Singapore. Who wants to bet this never gets built or if it does it will be an expensive disaster?

• China’s coal output hits new record high - the world’s largest producer and consumer of coal shows no sign of slowing down, with output reaching 390 mt in July, a record for that month. An emphasis on energy security and rising power demand in the hot summer months are driving the growth. Your regular reminder that what we do in the West vis-a-vis carbon emissions is almost irrelevant.

• EU revamps China EV tariffs - in June the EU announced tariffs on EVs imported from China that benefit “heavily from unfair subsidies” and pose a “threat of economic injury” (“injury”?! who writes this stuff?). The rate of the tariffs, which are specific to each company, have now been adjusted, with Tesla’s tariff cut to 9% from 20.8%.

🛢️ BOTTOM OF THE BARREL

👋 BEFORE YOU GO 

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

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