B07 Oil and Gas Extraction

Too early to say goodbye to tough times

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 20 : 2-Dec-16

AWE Limited CEO David Biggs says that oil and producers are unlikely to increase their capital investment until the longer-term impact of OPEC’s production cuts on the crude oil price is known. He believes that a sustained price above $US60 per barrel will be needed for oil companies to commit to increased spending. Beach Energy director Jim McKerlie agrees that the OPEC deal will not be a "gamechanger" for oil and gas producers.

CORPORATES
AWE LIMITED – ASX AWE, BEACH ENERGY LIMITED – ASX BPT, ORGANISATION OF PETROLEUM EXPORTING COUNTRIES, HORIZON OIL LIMITED – ASX HZN, SANTOS LIMITED – ASX STO, OIL SEARCH LIMITED – ASX OSH, ORIGIN ENERGY LIMITED – ASX ORG, WORLEYPARSONS LIMITED – ASX WOR, WOODSIDE PETROLEUM LIMITED – ASX WPL, FAR LIMITED – ASX FAR, RBC CAPITAL MARKETS

Mega-project days over: Exxon

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 15 : 1-Dec-16

ExxonMobil Australia chairman Richard Owen says the energy giant will consider options for undertaking a staged development of the Scarborough gas field. He has told a business lunch in Sydney that ExxonMobil is likely to examine ways to start delivering cash flows from new oil and gas projects at an earlier stage of their development, rather than the so-called "mega-project" approach of recent years. The Gorgon LNG has commenced shipments more than six years after construction commenced.

CORPORATES
EXXONMOBIL CORPORATION, WOODSIDE PETROLEUM LIMITED – ASX WPL, CHEVRON CORPORATION, GORGON PTY LTD

Mega-project days over: Exxon

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 15 : 1-Dec-16

ExxonMobil Australia chairman Richard Owen says the energy giant will consider options for undertaking a staged development of the Scarborough gas field. He has told a business lunch in Sydney that ExxonMobil is likely to examine ways to start delivering cash flows from new oil and gas projects at an earlier stage of their development, rather than the so-called "mega-project" approach of recent years. The Gorgon LNG has commenced shipments more than six years after construction commenced.

CORPORATES
EXXONMOBIL CORPORATION, WOODSIDE PETROLEUM LIMITED – ASX WPL, CHEVRON CORPORATION, GORGON PTY LTD

LNG giants face bill for underpaid royalties

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Original article by Paul Garvey
The Australian – Page: 19 & 22 : 29-Nov-16

The royalty regime for the North West Shelf LNG project is under scrutiny following a review by the Australian National Audit Office. Amongst other things, the ANAO concluded that there are deficiencies in the way royalty payments are calculated, while the project’s partners may not be entitled to all of the deductions which they have claimed. A spokeswoman for Woodside Petroleum says the company has strict compliance procedures regarding royalty payments, and any underpayment is unlikely to exceed $A11.6m.

CORPORATES
WOODSIDE PETROLEUM LIMITED – ASX WPL, NORTH WEST SHELF LNG PTY LTD, AUSTRALIAN NATIONAL AUDIT OFFICE, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE, WESTERN AUSTRALIA. DEPT OF MINES AND PETROLEUM, BHP BILLITON LIMITED – ASX BHP, BP PLC, CHEVRON CORPORATION, ROYAL DUTCH SHELL PLC, JAPAN AUSTRALIA LNG PTY LTD, MITSUBISHI CORPORATION, MITSUI AND COMPANY LIMITED

AGL mulls gas import to beat supply crunch

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Original article by Matt Chambers
The Australian – Page: 19 & 22 : 15-Nov-16

The high domestic price of gas in Australia’s southeastern states and supply constraints may prompt AGL Energy to source natural gas from regions such as Asia, Europe or the Middle East. AGL will undertake a feasibility study on the proposal to build an LNG import terminal and processing facility, which would capitalise on a global oversupply of LNG. Shell Australia chairman Andrew Smith put forward a similar suggestion earlier in 2016.

CORPORATES
AGL ENERGY LIMITED – ASX AGL, SHELL COMPANY OF AUSTRALIA LIMITED

Forrest branches into oil and gas

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Original article by Paul Garvey
The Australian – Page: 19 & 20 : 2-Nov-16

Goshawk Energy and a company owned by Fortescue Metals Group founder Andrew Forrest have applied for oil and gas exploration permits covering about 220,000 square kilometres in Western Australia’s onshore Canning Basin. Forrest has applied for the permits via Squadron Energy, which is a subsidiary of Minderoo. A spokeswoman for Minderoo says the company is not currently considering the use of fracking in the Canning Basin, but environmental groups have urged Forrest to rule out using the technology.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, SQUADRON ENERGY, MINDEROO PTY LTD, GOSHAWK ENERGY PTY LTD, BURU ENERGY LIMITED – ASX BRU, ENVIRONS KIMBERLEY, HANCOCK PROSPECTING PTY LTD, MINERAL RESOURCES LIMITED – ASX MIN, AUSTRALIAN LABOR PARTY, CONOCOPHILLIPS, APACHE CORPORATION, HESS CORPORATION, PETROCHINA COMPANY LIMITED, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, LAKES OIL NL – ASX LKO, EMPIRE OIL AND GAS NL – ASX EGO

Woodside plays down $US5 billion Wheatstone cost blowout

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 13 : 1-Nov-16

Woodside Petroleum has advised that a 17 per cent increase in the cost of the Wheatstone LNG project will have limited effect on the capital expenditure guidance it issued in early 2016. The oil and gas producer has a 13 per cent stake in the Chevron-led project, whose total cost has risen by $US5bn ($A6.6bn) to $US34bn. Saul Kavonic of Wood Mackenzie says he had already anticipated a cost over-run of at least 15 per cent.

CORPORATES
WOODSIDE PETROLEUM LIMITED – ASX WPL, CHEVRON CORPORATION, WOOD MACKENZIE, RBC CAPITAL MARKETS

Santos sells last Victorian asset

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Original article by Matt Chambers
The Australian – Page: 32 : 25-Oct-16

Australian-listed Cooper Energy will assume full ownership of the Sole gas project in the Gippsland Basin after securing a deal to acquire Santos’s 50 per cent stake for $A82m. Cooper Energy will undertake a $A63m capital raising to help finance the deal, and it will then seek a joint venture partner for the project. Santos has now offloaded all of its assets in Victoria. Its shares closed $A0.11 lower at $A3.73 on 24 October 2016.

CORPORATES
SANTOS LIMITED – ASX STO, COOPER ENERGY LIMITED – ASX COE

Record LNG output limits Woodside pain

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 24 : 21-Oct-16

Oil and gas producer Woodside Petroleum has reported that it produced 25.2 million barrels of oil equivalent during the September 2016 quarter, which is 13.5 per cent higher than the June quarter. Sales revenue rose by 19.8 per cent to $US988m ($A1.29bn), although this was nine per cent lower year-on-year. Woodside has lifted its full-year production guidance for 2016 to between 92 million and 95 million boe.

CORPORATES
WOODSIDE PETROLEUM LIMITED – ASX WPL, JP MORGAN AUSTRALIA LIMITED, CHEVRON CORPORATION

Origin Energy in recovery mode after $25b APLNG venture

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 17 : 20-Oct-16

Just 3.02 per cent of votes cast at Origin Energy’s 2016 AGM rejected the group’s remuneration report, although an equities grant to outgoing CEO Grant King attracted a "no" vote of 16.21 per cent. King told shareholders that the company’s investment in the Australia Pacific LNG project had taxed its resources, and a stake of 30 per cent rather than 37.5 per cent may have been appropriate. However, King is upbeat about Origin’s outlook. He will be succeeded by Origin veteran Frank Calabria.

CORPORATES
ORIGIN ENERGY LIMITED – ASX ORG, AUSTRALIA PACIFIC LNG LIMITED, RBC CAPITAL MARKETS