B07 Oil and Gas Extraction

Santos sticks to gas, earmarking $1bn for Narrabri development

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Original article by Perry Williams
The Australian – Page: 16 : 2-Dec-20

Santos CEO Kevin Gallagher says the oil and gas producer will not diversify into renewable energy or electricity generation. He contends that global demand for fuels will remain strong for a long time, while gas will play a major role in reducing carbon emissions over coming decades. Meanwhile, Santos expects to make a final investment decision on its Narrabri gas project in the first half of 2023, with the first phase of its development slated to cost $US650m. Santos has also advised that its Barossa LNG project will cost significantly less to develop than initially forecast.

CORPORATES
SANTOS LIMITED – ASX STO

Tough market sours outlook for resources

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Original article by Perry Williams
The Australian – Page: 13 & 16 : 23-Nov-20

A new report from the federal government notes that Australia’s resource and energy sector made final investment decisions on $39bn worth of projects in the year to 31 October, which is 30 per cent higher than previously. The total value of the sector’s investment pipeline has risen to $334bn in 2020. However, the Department of Industry, Science, Energy & Resources’ latest Major Projects report warns that investment is unlikely to return to the levels seen during the last boom in the minerals and energy sector.

CORPORATES
AUSTRALIA. DEPT OF INDUSTRY, SCIENCE, ENERGY AND RESOURCES

China fallout hits Woodside gas sale plan

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 14 & 18 : 12-Nov-20

Woodside Petroleum CEO Peter Coleman says potential Chinese investors have abandoned talks to acquire a stake in Scarborough gas project due to the growing trade tensions between Australia and China. He adds that this contributed to Woodside’s decision to drop plans to reduce its stake in the Scarborough project and focus on selling a stake in the Pluto-2 project. Coleman has stressed that relations between Woodside and its existing Chinese customers and partners remain strong.

CORPORATES
WOODSIDE PETROLEUM LIMITED – ASX WPL

More pain for BP after decision to shut Kwinana refinery

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Original article by Perry Williams, Nick Evans
The Australian – Page: Online : 2-Nov-20

Energy Minister Angus Taylor will hold meetings with the operators of the three remaining oil refinery operators in the week beginning 2 November. This follows the announcement by BP on 30 October that it plans to close its Kwinana refinery in Western Australia, with Taylor’s meetings coming amid fears that Australia’s entire oil refining industry could be gone within 12 months. The three remaining refineries are located at Lytton in Brisbane, and at Geelong and Altona in Victoria, and are operated by Ampol, Viva Energy and ExxonMobil respectively. The closure of Kwinana will see 600 people lose their jobs, while BP is in the process of shedding around 200 additional jobs, most of which are office roles.

CORPORATES
AUSTRALIA. DEPT OF INDUSTRY, SCIENCE, ENERGY AND RESOURCES, BP PLC, AMPOL LIMITED – ALD, VIVA ENERGY GROUP LIMITED – ASX VEA, EXXONMOBIL AUSTRALIA PTY LTD

Forrest to drive gas import terminal

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Original article by Perry Williams
The Australian – Page: 15 : 30-Oct-20

Mining magnate Andrew Forrest is set to proceed with a proposed LNG import terminal at Port Kembla in New South Wales. Sources have indicated that Forrest’s private company Squadron Energy is close to finalising a long-term lease at Port Kembla. Squadron recently bought out its Japanese partners in the project, and it has previously indicated that construction work could start by the end of 2020. A number of other LNG import projects have been proposed to address gas supply concerns in Australia’s eastern states.

CORPORATES
SQUADRON ENERGY PTY LTD

Gas intervention could backfire: Santos

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Original article by Perry Williams
The Australian – Page: 17 : 16-Oct-20

Andrew Liveris, an adviser to the federal government, contends a gas price of $4 a kilojoule is an achievable target for the east coast market. However, gas producers believe such a target is not realistic, and Santos CEO Kevin Gallagher has told the annual Citi Annual Investment Conference that the $4 target is too ambitious. Gallagher says "meddling on price settings" by the federal government would put at risk new supply and investment, while he says that increasing gas supply will help to bring about lower prices.

CORPORATES
SANTOS LIMITED – ASX STO

BHP’s fresh punt on Bass Strait

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Original article by Perry Williams
The Australian – Page: 13 & 20 : 3-Jul-20

BHP is one of several companies that provided funding for a 11,500sq km seismic survey in Bass Strait. This has prompted speculation that BHP may be hoping to make a new gas discovery as a prelude to divesting its 50 per cent stake in the Bass Strait joint venture. ExxonMobil is pressing ahead with plans to sell its stake; some observers believe that BHP’s non-operating stake could be more appealing to prospective buyers, and that it could potentially secure a deal before ExxonMobil.

CORPORATES
BHP GROUP LIMITED – ASX BHP, EXXONMOBIL CORPORATION

Aussie gas spurs Shell’s $12bn hit

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Original article by Perry Williams
The Australian – Page: 13 & 19 : 1-Jul-20

Macquarie expects more companies in Australia’s energy sector to announce writedowns in the second half of 2020, in the wake of the sharp fall in the crude oil price. Global energy giant Shell has advised of impairment charges of up to $US22bn; this includes a writedown of between $US8bn and $US9bn on its gas business, primarily due to its gas projects in Australia. The price of Brent crude is trading at around $US40 a barrel, and Macquarie notes that Australian energy producers typically use a price of $US70 to $US75 a barrel for impairment testing purposes.

CORPORATES
ROYAL DUTCH SHELL PLC, SHELL COMPANY OF AUSTRALIA LIMITED, MACQUARIE GROUP LIMITED – ASX MQG

More may exit NW Shelf, Woodside warns

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Original article by Perry Williams
The Australian – Page: 13 & 17 : 25-Jun-20

Woodside Petroleum director Ann Pickard says the North West Shelf joint venture worked very well at first, but the competing interests of the six partners have progressively gotten in the way. She says other partners could opt to join Chevron in selling out of the LNG venture, given that the NWS plant is set to begin processing third-party gas as the project’s reserves run down. Former Woodside CEO Don Voelte says Shell and BP could potentially sell their NWS stakes.

CORPORATES
WOODSIDE PETROLEUM LIMITED – ASX WPL, NORTH WEST SHELF LNG PTY LTD, CHEVRON CORPORATION, BP PLC, ROYAL DUTCH SHELL PLC

NW Shelf shake-up looming

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Original article by Perry Williams
The Weekend Australian – Page: 21 & 22 : 20-Jun-20

Former Woodside Petroleum CEO Don Voelte says a new model for the $34 billion North West Shelf LNG plant that would see it process gas for other firms may not suit some of its current owners. Woodside is one of six joint-venture partners who own the plant, but Chevron has decided to sell out of the plant, and BP and Shell could follow suit. Voelte says he would not surprised to see more selling of assets by major oil firms; he notes that Exxon is currently trying to sell its interest in the Bass Strait assets. He says asset sales have always been part of the majors’ strategy, but they would not get as much now as they would now.

CORPORATES
WOODSIDE PETROLEUM LIMITED – ASX WPL, CHEVRON CORPORATION, BP PLC, ROYAL DUTCH SHELL PLC, EXXON CORPORATION, BHP GROUP LIMITED – ASX BHP