B07 Oil and Gas Extraction

Santos warns ‘hot air’ inflating gas debate

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Original article by Leo Shanahan
The Australian – Page: 17 & 20 : 19-Apr-17

Executives from LNG producers will meet with Prime Minister Malcolm Turnbull on 19 April 2017. Santos CEO Kevin Gallagher has cautioned against government intervention to address the gas crisis on the east coast, arguing that it is not the role of governments to "pick winners and losers". He adds that lack of sufficient development of gas resources is the main cause of the crisis. Opposition Leader Bill Shorten believes that the government should step in to resolve the crisis, saying domestic gas users should be prioritised over export customers.

CORPORATES
SANTOS LIMITED – ASX STO, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, AUSTRALIAN LABOR PARTY, GLADSTONE LNG PTY LTD, ORIGIN ENERGY LIMITED – ASX ORG, AUSTRALIA PACIFIC LNG LIMITED, ROYAL DUTCH SHELL PLC, QUEENSLAND CURTIS LNG PTY LTD

$238bn tax shield cushions oil giants

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Original article by Ben Butler
The Australian – Page: 19 & 22 : 13-Apr-17

Data from the Australian Taxation Office shows that Petroleum Resource Rent Tax revenue from oil and gas companies fell to just $A845m in 2015-16, compared with $A1.79bn in 2013-14. Meanwhile, the industry claimed a total of $A238bn in tax deductions for exploration expenditure under carry-forward regulations in 2015-16, compared with just $A970 million in 2003-04. The PRRT is currently the subject of two separate reviews, although oil and gas producers have warned that changes to the tax may deter future investment in Australia.

CORPORATES
AUSTRALIAN TAXATION OFFICE, BHP BILLITON LIMITED – ASX BHP, WOODSIDE PETROLEUM LIMITED – ASX WPL, CHEVRON CORPORATION, GORGON PTY LTD, AUSTRALIA. DEPT OF THE TREASURY, NICK XENOPHON TEAM, FEDERAL COURT OF AUSTRALIA

Shell first into crisis breach to shore up local gas supply

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Original article by Angela Macdonald-Smith, Mark Ludlow
The Australian Financial Review – Page: 12 : 22-Mar-17

Shell Australia will undertake a $A500m gas well drilling program in south-east Queensland. Dubbed Project Ruby, it could comprise up to 161 new wells, which will supply gas to both the domestic and export markets. Shell has also advised that the amount of gas it supplies to the domestic market will increase by 10 per cent in 2017, to more than 75 petajoules. Meanwhile, Shell Australia chairman Andrew Smith notes that it is cheaper to ship gas from the US to Victoria than from Queensland.

CORPORATES
SHELL COMPANY OF AUSTRALIA LIMITED, ROYAL DUTCH SHELL PLC, QUEENSLAND. DEPT OF THE PREMIER AND CABINET, ARROW ENERGY LIMITED, PETROCHINA COMPANY LIMITED, QUEENSLAND CURTIS LNG PTY LTD, SANTOS LIMITED – ASX STO, GLADSTONE LNG PTY LTD, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET

LNG exports post $1.9bn record

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Original article by Matt Chambers
The Australian – Page: 19 & 22 : 30-Jan-17

Data from the Australian Bureau of Statistics shows that the nation’s revenue from LNG exports rose from $US1.39bn in July 2016 to $A1.9bn in November. Meanwhile, the three LNG plants in Queensland shipped 1.75 million tonnes via the Port of Gladstone in December, compared with 1.5 million tonnes in October. Chevron CEO John Watson has indicated that the second production train at the Gorgon LNG project has reached 90 per cent of capacity, while the third train is likely to commence production in the June 2017 quarter.

CORPORATES
CHEVRON CORPORATION, GORGON LNG, AUSTRALIAN BUREAU OF STATISTICS, ORIGIN ENERGY LIMITED – ASX ORG, AUSTRALIA PACIFIC LNG LIMITED, CONOCOPHILLIPS, PORT OF GLADSTONE, AUSTRALIAN ENERGY MARKET OPERATOR LIMITED, AUSTRALIA. DEPT OF THE TREASURY, BP PLC, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT

Santos surprises with $1.5b capital raising

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 17 : 15-Dec-16

Australian-listed oil and gas producer Santos will issue new shares at $A4.06 apiece in a $A1.5bn equity raising. It will comprise a $A1.04bn institutional placement and a $A500m share purchase plan for existing shareholders. Santos had previously raised some $A3bn in late 2015. Santos recently revealed plans to shift non-core assets to a separate division in order to focus on its key projects. The group’s shares closed at $A4.41 on 14 December 2016.

CORPORATES
SANTOS LIMITED – ASX STO, DEUTSCHE BANK AG, MORGAN STANLEY AUSTRALIA LIMITED, ALPHINITY INVESTMENT MANAGEMENT PTY LTD, JB NORTH AND COMPANY PTY LTD

Santos takes ‘sweat or exit’ action

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 15 & 18 : 9-Dec-16

Australian-listed oil and gas producer Santos aims to slash its net debt by $US1.5bn ($A2bn) by 2019 as part of a restructuring program. This will including moving non-core assets to a holding company, allowing the group to focus on five key growth assets. These include the Gladstone LNG project, its Cooper Basin gas assets and the Papua New Guinea LNG venture. Santos will also make its gas processing facilities available to rival gas producers. The non-core assets could potentially be sold in the future.

CORPORATES
SANTOS LIMITED – ASX STO, ORIGIN ENERGY LIMITED – ASX ORG, ENN HOLDINGS, AWE LIMITED – ASX AWE, AUSBIL INVESTMENT MANAGEMENT LIMITED, CLOUGH LIMITED, RBC CAPITAL MARKETS

Analysts cool on Origin’s petroleum plan

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 15 : 8-Dec-16

Ben Wilson of RBC Capital Markets has questioned Origin Energy’s lack of information regarding the proposal to spin off its conventional oil and gas assets. However, he notes that the partial demerger will reduce Origin’s debt and the company’s complexity, and adds that Origin could eventually also offload its stake in the Australia Pacific LNG project. Mark Samter of Credit Suisse says the demerger has merits, but he believes that Origin should have pursued a trade sale rather than an IPO.

CORPORATES
ORIGIN ENERGY LIMITED – ASX ORG, RBC CAPITAL MARKETS, CREDIT SUISSE (AUSTRALIA) LIMITED, AUSTRALIA PACIFIC LNG LIMITED, JP MORGAN AUSTRALIA LIMITED, BEACH ENERGY LIMITED – ASX BPT, CITIGROUP PTY LTD

Origin Energy spins off oil and gas business

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 15 & 20 : 7-Dec-16

Australian-listed Origin Energy has revealed plans for a partial demerger in 2017, with its conventional oil and gas assets to be held by a separately listed company. However, Origin will retain its stake in the Australia Pacific LNG project in Queensland, while it will not hold a stake in the new company. Origin CEO Frank Calabria says an IPO was deemed to offer the best value, although he adds that the group would be open to an offer that represented better value than a float. JP Morgan estimates that the assets that will be spun off are worth around $A1.8bn.

CORPORATES
ORIGIN ENERGY LIMITED – ASX ORG, AUSTRALIA PACIFIC LNG LIMITED, JP MORGAN AUSTRALIA LIMITED, SANDON CAPITAL INVESTMENTS LIMITED – ASX SNC, TATTS GROUP LIMITED – ASX TTS, ILUKA RESOURCES LIMITED – ASX ILU, MACQUARIE CAPITAL PTY LTD, UBS HOLDINGS PTY LTD, ALLAN GRAY AUSTRALIA PTY LTD, AGL ENERGY LIMITED – ASX AGL, BEACH ENERGY LIMITED – ASX BPT, STANDARD AND POOR’S FINANCIAL SERVICES LLC, MOODY’S INVESTORS SERVICE INCORPORATED

BHP tops big oil in Mexico

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Original article by Peter Ker
The Australian Financial Review – Page: 1 & 6 : 7-Dec-16

BHP Billiton has acquired a 60 per cent stake in the Trion oil field in the Gulf of Mexico, following a highly-contested auction process. BHP will initially pay $US62.4m for the stake, while the deal also requires it to spend at least $US320m ($A429m) on an appraisal program. Mexico’s state-owned Pemex, which will have a 40 per cent stake in Trion, estimates that the oil field could contain about 485 million barrels of oil equivalent. BP also submitted a bid to acquire the Trion stake.

CORPORATES
BHP BILLITON LIMITED – ASX BHP, PEMEX PETROLEOS MEXICANOS, BP PLC, COLONIAL FIRST STATE GLOBAL ASSET MANAGEMENT, MACQUARIE GROUP LIMITED – ASX MQG, RIO TINTO LIMITED – ASX RIO, NEWCREST MINING LIMITED – ASX NCM, OZ MINERALS LIMITED – ASX OZL, MEXICO. MINISTRY OF ENERGY

Producers spot better returns

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Original article by Matt Chambers
The Australian – Page: 21 : 6-Dec-16

Data from EnergyQuest shows that the spot price of gas in Adelaide rose to nearly $A10 per gigajoule in the September 2016 quarter, while the spot price in Sydney and Brisbane also rose. In contrast, the LNG netback price at the Wallumbilla processing hub in Queensland fell to around $A6 per gigajoule. EnergyQuest expects LNG producers to capitalise on the rise in gas prices by redirecting more of their output to the domestic market.

CORPORATES
ENERGYQUEST PTY LTD, QUEENSLAND CURTIS LNG PTY LTD, ROYAL DUTCH SHELL PLC