TOPICS OF INTEREST
ASSET/PORTFOLIO MANAGEMENT
ConocoPhillips Completes Acquisition of Permian Producer Concho Resources
The Houston-based oil and gas company has expanded its footprint in the liquids-rich Permian by more than 550,000 acres.
BP Relaunches Sale of Stakes in North Sea Assets
BP agreed 1 year ago to sell its interests to Premier Oil for $625 million. The companies later restructured the deal and BP lowered its cash value to $210 million. The transaction fell through after Premier was taken over by Chrysaor in October 2020.
Devon and WPX Finalize Merger With New CEO
On a pro forma basis the newly combined oil company is expected to have an output of around 280,000 B/D, making it one of the top producers in the Permian Basin.
Cenovus Closes Husky Acquisition, Becomes Canada’s Third Largest Oil & Gas Producer
The two Calgary-based heavy-oil companies have closed on their all-stock deal that was valued at around $2.9 billion when it was announced in October.
Shale Consolidation: Diamondback Energy Strikes with Double-Acquisition
The two deals have a combined valued of $3 billion and involve more than 81,500 acres in the Midland Basin of Texas.
Shell's Asset Value Cuts Nearing $22 Billion
Shell ended the year by announcing more writedowns, pushing the total near $22 billion, and raising questions about the future of its Appomattox platform in the Gulf of Mexico
Shell Closes Gazprom Neft JV Deal, Plants Flag in Russian Arctic
The new deal will focus on developing Arctic onshore blocks in a region where a successful LNG project already exists.
Chevron’s $14-Billion Budget Prioritizes Kazakhstan Over Permian Basin
The supermajor said that it hopes to complete a megaproject in Kazakhstan before rerouting future spending to the Permian Basin and other developments.
Oman Establishes New State Energy Company To Raise Money From Its Largest Oil Block
The move will give the new entity shareholding in PDO and remove PDO’s oil and gas expenditures from Oman’s state budget.
OPEC+ To Relax Historic Crude Cut by 500,000 B/D in January
Under the group’s historic April agreement, the easing of voluntary cuts would have been 2 million B/D, which would have been too much for markets to absorb.
Reserves Management
Even without the black swan event of COVID-19, the industry must critically examine the technical, commercial, and operational bases of the projects it proposes and executes. A logical, reasonable, ethical, and philosophical approach is critical to underpin good decision making and value creation.
ExxonMobil Announces Spending Plan and a Major Writedown of Dry-Gas Projects
ExxonMobil has trimmed its future spending by more than 30% and said it will seek to divest from gas assets in the US, Canada, and Argentina.
Is It Time To Buy Oil Acreage? A $900-Million Deal Says Yes
At least one investment firm thinks there is money to be made in oil and gas operations and is putting up $900 million in equity to fund a startup by two veterans from Felix Energy.
Oil Production Outlook Flatlines
The good news for next year is no one is predicting a repeat of what happened this year. The bad news is the outlooks offers little incentive to find any more oil.
Oklahoma Natural Gas Producer Enters Restructuring
Gulfport Energy is seeking to eliminate more than $1 billion in debt and to cancel or renegotiate firm transportation contracts that it said drove it to enter bankruptcy protection.
Latest Shale Sector Acquisition Combines Two Colorado Producers
Bonanza Creek plans to buy HighPoint Resources and said it hopes to maintain an output of 50,000 BOE/D by focusing only on drilled-but-uncompleted wells in the near term.
Equinor Aims To Become Net-Zero Energy Company by 2050
As it reaches for net-zero emissions, the company said its operations offshore Norway remain central to its long-term strategy.
EQT Swells Gas Holdings With Acquisition of Chevron’s Appalachian Assets
Describing it as a “bolt-on” acquisition, the Marcellus Shale producer EQT expects the deal will boost its gas production by 10%.
A “Survivor” of the Downturn, Pioneer Buying Parsley To Become Permian’s Largest Producer
In another all-stock transaction, one of the largest operators in the Permian Basin is set to add nearly 250,000 acres to its portfolio and swell oil production to more than 300,000 B/D.
ConocoPhillips Promises Big Changes as It Acquires Concho in $9.7-Billion Deal
ConocoPhillips promised more than just growth and costs savings when it announced a deal to acquire Concho.
The End Is Near for Riviera Resources
Marking the end of a 2-year existence, Riviera is preparing for liquidation and dissolution. The sale of its upstream and midstream assets for $146 million will deliver a $1.35-per-share cash dividend to shareholders. By the end of this year, the company will cease to exist.
Hess Sale Raises $505 Million To Pay for Guyana Development
With oil prices still low, Hess decided to sell a stake in one offshore project to help pay to develop a much larger one.
Chrysaor’s Reverse Takeover of Premier Oil To Create Largest North Sea Independent
The merger will effectively end the 86-year run of UK independent oil producer Premier Oil and give rise to one of the largest companies operating in the North Sea region.
Shale Consolidation: Permian Players Devon Energy and WPX Energy Announce All-Stock Merger
The two shale producers are calling it a “merger of equals” and will share management duties once the transaction closes. The combined company aims to become the fourth-largest producer of tight oil in the US.
UPDATE: Workers Return to Offshore Platforms After Hurricane Sally Evacuations
Personnel are returning to platforms in the Gulf of Mexico after Hurricane Sally was downgraded to a tropical depression late Wednesday, but the threat of another major hurricane remains as a tropical storm may form in the Gulf of Mexico today.
Kosmos Sells Frontier Interests to Shell in $100-Million Deal
The acquisition and divesture deal includes large-interest positions in nine offshore exploration blocks, several of which Shell may become the operator of.
Shale Sector Restructuring: Whiting Petroleum Exits as Others Just Begin the Bankruptcy Process
The latest updates on the North American shale sector’s efforts to consolidate and restructure.
Gulf of Mexico Independent To Sell Off Assets in $1-Billion Bankruptcy Deal
In the region’s second bankruptcy of the month all of the operator’s assets will be sold to a private equity energy group, pending court approval.
New US Oil and Gas Lease Auctions To Begin 26 August
The US Bureau of Land Management’s August auction will be the first since March.
Total Launches Mero Phase 3 Offshore Brazil
Operators celebrate first major deepwater project sanctioned since the early-2020 oil crash.
Oil Major Invests in Nuclear Startup Company
Zap Energy will use Chevron’s investment to develop its technology, a next-generation modular nuclear reactor with an aim toward cost-effective, flexible, and commercially scalable fusion.
UPDATE: Occidental Recalibrates: More Writedowns, One Permian Rig, Algerian Assets Not for Sale
The large independent joins the ranks of many other oil and gas producers who have been forced to reduce their exploration activity and the value of their booked reserves due to lower energy prices.
Shale Consolidation: Two US Tight-Gas Producers Merge in All Stock-Deal
The latest deal is set to make Southwestern Energy the third-largest producer in the gas-rich Appalachian Basin.
Despite Big Profit Drop, Saudi Aramco Seeks Production Ceiling of 13 Million B/D
The world’s largest oil company saw profits fall by nearly three quarters during the previous quarter but it still weathered the storm better than international majors.
GOM E&P Fieldwood Energy Files Chapter 11, Its Second Since 2018
The Gulf of Mexico E&P exited its first bankruptcy quickly with a strategy that included the acquisition of Noble Energy’s GOM assets, which increased its production volumes 25% when the WTI approached $80/bbl. Fieldwood’s financial woes in today’s economics may be tougher to overcome.
ExxonMobil Looking at a 20% Reserve Reduction
ExxonMobil is reluctant to join other big oil companies writing down the value of their reserves. It could chop its reserves by 20%, but it has not made a final decision.
BP Pivots From IOC to Integrated Energy Company as It Resets for Energy Transition
Supermajor announces actions to achieve net-zero ambition and reshape business. It also noted that it will not seek to explore in countries where it does not already have upstream activities.
After 4 Years, Range Resources Exits Louisiana Tight-Gas Play
The Pennsylvania-based producer will leave Louisiana where profiting from tight-gas fields has proven difficult and focus on its legacy assets in the Marcellus Shale.
Shell, Chevron Combined Quarterly Losses Top $25 Billion
Shell and Chevron lead the pack in a slew of Q2 losses with $18.1 billion and $8.3 billion, respectively. ExxonMobil, ConocoPhillips, Royal Dutch Shell, Petrobras, and Repsol also posted losses. The tally of these global majors’ losses in a single quarter tops $30 billion.
As Oil Companies Fade Away, Who Will Buy Their Wells?
Shale producers proved they could pump out record volumes of oil by drilling horizontal wells and then fracturing them intensively. Now the industry needs to find buyers for many wells and acreage with hard-to-determine values.
ConocoPhillips To Acquire Canadian Unconventionals in Montney Shale
The all-cash deal bucks a recent trend of international oil companies divesting of Canadian assets and adds 15,000 B/D of production to the buyer’s total.
From Running 13 Rigs to “Just Sell What You Have Got”
A company built with a plan to quickly profit from the shale boom began a slow decline when oil prices sank to $50/bbl. Others could be following it to bankruptcy court this year.
Australia Presents Opportunity for E&P Companies Looking Beyond US Unconventionals
Black Mountain executives outlined the key criteria they used to determine why Western Australia was a prime location for private-equity investment when looking at international unconventional plays.
Unconventionals at a Crossroads: Where Do We Go From Here?
URTeC 2020’s opening plenary session panel shared insights into how the shale industry can scale technology, fiscal restraint, and social responsibility into a sustainable business case for a new energy landscape.
Are Half the Companies in Shale Really Superfluous?
Judgment day may finally have arrived for weak players in the shale business. Deloitte ranks nearly half of the companies as extraneous. What happens next?
Chevron Scoops Up Noble Energy in $5-Billion Deal
Chevron strengthens its North American position with assets in the Permian, DJ, and Eagle Ford basins and offshore in Israel and West Africa.
Oil and Gas Companies Begin Turning to Renewables To Power Operations
IHS Markit says the industry’s “striking pace of growth” and a dynamic commercial environment are fueling the movement to zero-carbon sources.
Dispute Over Mexico’s First Foreign Offshore Discovery Is Drawing to a Close
Pemex and Talos Energy have 120 days to decide how to share a massive offshore field that both companies claim they should operate. Failure to come to terms means the government will decide the matter.
Price-Plunge Fallout: Let’s Make a Deal
Nearly everything’s on the table as companies aim to shore up portfolios by curtailing investments and dumping low-priority assets.
Shell Wipes Out Up To $22 Billion From Major Oil and Gas Projects
Two of the biggest assets to suffer from the new valuation are in Australia. Shell’s QGC venture and its floating liquified natural gas facility, Prelude, have been reduced in value by up to $9 billion.
BP To Sell Petrochemicals Business for $5 Billion
The deal includes 15 global sites and over 1,700 staff expected to transfer to INEOS upon completion of the sale. The deal also follows BP’s announcement earlier in the month that it would cut 14% of its workforce.
Chesapeake Energy Files for Bankruptcy Protection
The distressed shale pioneer will wipe away nearly $7 billion in debt and is likely to make major asset sales as it attempts to restructure itself into a profitable business.
JV Strikes Blockbuster Infrastructure Deal With ADNOC
The $20.7-billion agreement is the single-largest energy infrastructure investment in the region.
BP Slashes Up to $17.5 Billion in Assets; Cites Pandemic for Swifter Shift to Net Zero
Write-offs include billions for early-exploration-stage projects that the company will now cut.
What Damage Is Wrought by the Rush to Shut In Wells?
The Permian Basin is now influencing the upstream water market on the way down, while many questions swirl around the implications of unprecedented shut-ins.
US Dept. of Interior Stalls More Oil and Gas Lease Sales
Mississippi land no longer up for grabs, as the fed continues to postpone or cancel the sale of public parcels.
Lagos Court Rulings Thwart Nigerian Oilfield Licensing Round
Country had hoped to boost oil output and bring in much-needed revenues.
Schlumberger To Restructure Business Units
Schlumberger plans to restructure by focusing on basins and divisions in line with customers’ E&P workflows.
Neptune Exits Deal With Energean for North Sea Assets
Neptune must pay Energean a break-up fee of $5 million for cancelling what was to be a $250 million deal.
Total Puts the Brakes on Oil Deal With Occidental
Houston-based Occidental had earmarked the money to ease debt from buying Anadarko.
ADNOC’s New CTO Shares Innovation Philosophy
Alan Nelson is not only the new chief technology officer at ADNOC, he is the company’s first person to hold the title at the integrated oil company.
Wintershall Dea Makes Third Oil Discovery in Less Than a Month
Two discoveries offshore Mexico add to April’s finding in the Norwegian Sea.
KLX Energy Services To Merge with Quintana Energy Services
The merged companies will offer large-diameter coiled-tubing, directional drilling, snubbing, wireline services, and pressure pumping services.
Offshore Discoveries Continue Even as Shale Slows
Four recent deepwater offshore discoveries show exploration is not dead, it is just concentrated offshore.
Diamond Offshore Files for Bankruptcy
The chapter 11 filing comes as record-low crude prices and excess supply have impacted operations across the industry. About 2,500 jobs could be at stake.
Negative US Oil Prices Could Return in May
The nuances of futures contracts caught many of the world’s traders off guard, sending major US crude benchmark into negative pricing territory for the first time. But it probably will not be the last time.
IEA Head Declares “Black April” as Oil Oversupply Peaks at 29 Million B/D
A new report shows that the worst of the ongoing downturn may be soon over. A gradual recovery to global oil markets is expected to begin in the next few weeks.
Pandemic, Falling Oil Prices Threaten Global Licensing Rounds
Exploration commitments are expected to dwindle in the current market environment.
Whiting Bankruptcy Opens a New Frontier for Executive Payouts
Golden parachutes typically pay executives big money if they are fired without cause. Whiting Petroleum executives found a way to collect theirs for staying on board after the company they led filed for bankruptcy.
Spending Cuts First, Job Cuts Are Next
Oil exploration and production jobs globally are at about the level they were after deep cuts following the 2014 crash. Now companies need to find more to cut.
Chevron Hits the Brakes on Permian, Cuts $8 Billion Across Company
The international major has lowered its output forecast in the world’s most prolific unconventional basin by 20%.
Industry Faces Long Road to Recovery
Leaders of Rystad Energy went online recently to talk about the effects of the coronavirus pandemic on the oil and gas industry, and the prognosis isn’t good.
Global Upstream Industry Moves Into Survival Mode
As the fallout deepens from the coronavirus pandemic and the global collapse in oil and gas prices, oil- and gas-producing regions around the world are feeling the pain.
Interest in US Gulf Lease Sale Sapped by Price Crash
Oil and gas operators played it safe in the latest offshore auction by placing about half the high bids typically made. As a result, the total dollar commitment for the round was the lowest since 2017.
BP Aims for Net-Zero Emissions, Oxy To End Flaring
BP says it is firmly committed to achieving the ambitious target of net-zero greenhouse gas emissions over the next 30 years—even if that means producing less oil and gas.
Lundin Petroleum Joins Decarbonization Movement With a Name Change
The Swedish oil and gas producer is aiming to produce 200,000 B/D while offsetting the entirety of its carbon footprint.
Report: BP Pulling Out of Iraq Field
The withdrawal comes at a time of increasing tension between the US and Iraq, which makes investment in the country riskier.
Talos Shares Zama Reserves Audit Amid Unitization Negotiations With Pemex
Talos is hoping to retain its operatorship of the major discovery it made in 2017 offshore Mexico after a reserves audit confirmed the reservoir is shared between two offshore blocks.
Discovery Suggests Guyana Bounty Extends Offshore Suriname
A significant discovery of oil off Suriname increases the odds that major oilfields off Guyana will extend across that international boundary.
BP Makes $625 Million Exit From North Sea Assets
The deal is part of BP’s plan to divest $10 billion in the North Sea so that it can focus on developing core growth areas and construct more cost-effective subsea tiebacks in the region.
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