ENERGY INDUSTRIES

Australia to slip in LNG ranking

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 19 : 27-Jun-18

The International Energy Agency’s latest gas market report notes that global demand for natural gas increased by three per cent in 2017. This was primarily due to rising gas consumption in China as part of the nation’s strategy to improve air quality. Meanwhile, the IEA forecasts that the global LNG market will grow by nearly 30 per cent over the next five years. Much of this growth will be due to higher production by the US, which is forecast to supplant Australia as the second-largest LNG exporter by 2023.

CORPORATES
INTERNATIONAL ENERGY AGENCY

LNG glut may last 10 years

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Original article by Matt Chambers
The Australian – Page: 20 : 7-Dec-17

Most analysts expect rising demand for LNG to result in a global shortage by 2023. However, Macquarie Group has forecast that the current global oversupply could potentially last until 2027. The prospect of increased output by countries such as the US, Russia and Qatar are among the factors that could contribute to the oversupply being sustained for longer than anticipated. Meanwhile, new data shows that the three LNG projects in Queensland shipped 1.704 million tonnes in November, compared with 1.68 million tonnes in October.

CORPORATES
MACQUARIE GROUP LIMITED – ASX MQG, ROYAL DUTCH SHELL PLC, SANTOS LIMITED – ASX STO, ENN GROUP

Renewables on the rise but world will still rely on coal

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Original article by Graham Lloyd
The Australian – Page: 2 : 19-Sep-17

The US Energy Information Administration has forecast 28 per cent growth in global energy consumption between 2015 and 2040. Its outlook report also shows that global production of coal will rise by three per cent over the 25-year period. Coal consumption is expected to fall in OECD nations and China, but this will be offset by an increase in countries such as India. The report concludes that fossil fuels will still account for more than 75 per cent of global energy consumption in 2040, although electric power generation via renewables is forecast to record the strongest growth over this period.

CORPORATES
UNITED STATES. DEPT OF ENERGY. ENERGY INFORMATION ADMINISTRATION, ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT

LNG price pain is still to come

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

Oversupply in the LNG Asian market could force some of Australia’s LNG producers to reduce capacity. Fereidun Fesharaki, chairman of consultancy FGE, says prices will be under pressure. The price of LNG in north Asia has declined to about $US4.50 per million British thermal units from about $US20 in early 2014, and further declines are likely.

CORPORATES
ORIGIN ENERGY LIMITED – ASX ORG, FGE

Energy players ready for mergers

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Original article by Paul Garvey
The Australian – Page: 31 : 26-May-16

A global survey by international law firm Ashurst has found that 83 per cent of oil and gas company executives anticipate a 50 per cent rise in mergers and acquisitions activity in the sector during 2016. M&A activity is also expected to rise strongly over the next 3-5 years. Meanwhile, some 87 per cent of respondents indicated that their latest strategic plan has either reduced their capital investment budget or left it unchanged.

CORPORATES
ASHURST LLP, OIL SEARCH LIMITED – ASX OSH, INTEROIL CORPORATION, AWE LIMITED – ASX AWE, LONE STAR FUNDS

Drones, digital tech offer savings for oil firms

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 26 : 15-Apr-16

Unscheduled downtime at LNG projects is estimated to cost about $US11m per day, according to General Electric. Lorenzo Simonelli, the CEO of the conglomerate’s GE Oil & Gas division, says technology can be utilised to minimise such disruptions. This could include the use of drones to monitor the condition of offshore oil or gas platforms and detect leaks, and the use of predictive analysis to determine the likelihood that oil and gas equipment will break down.

CORPORATES
GENERAL ELECTRIC COMPANY, GE OIL AND GAS, CONOCOPHILLIPS, SIEMENS AG, AUSTRALIAN COMPETITION AND CONSUMER COMMISSION, WOODSIDE PETROLEUM LIMITED – ASX WPL

Spot pricing threatens LNG supply glut

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Original article by Paul Garvey, Matt Chambers
The Australian – Page: 19 & 22 : 13-Apr-16

Woodside Petroleum CEO Peter Coleman has expressed concern that any move to adopt spot pricing for LNG could result in an oversupply and subsequent downward pressure on prices. He noted that this was the outcome when other commodities shifted to a spot pricing system. Royal Dutch Shell CEO Ben van Beurden expects long-term contracts to continue to be the primary mechanism for setting LNG prices, but he has suggested that these contracts could eventually be linked to the Henry Hub spot gas price rather than the crude oil price.

CORPORATES
WOODSIDE PETROLEUM LIMITED – ASX WPL, ROYAL DUTCH SHELL PLC, CHEVRON CORPORATION

Energy M&A on rise as new players emerge

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 24 : 3-Mar-16

Herbert Smith Freehills partner Rob Merrick says expectations that the downturn in the crude oil price will be sustained may prompt consolidation in the global oil and gas industry. Many Australian-listed energy groups announced asset writedowns during the February 2016 reporting season, but Merrick says they are at less risk of being forced sellers of assets than their overseas peers. The law firm says private equity firms, pension funds and infrastructure funds may actively pursue oil and gas industry acquisitions.

CORPORATES
HERBERT SMITH FREEHILLS PTY LTD, ROYAL DUTCH SHELL PLC, BG GROUP PLC, WOODSIDE PETROLEUM LIMITED – ASX WPL, SENEX ENERGY LIMITED – ASX SXY, SANTOS LIMITED – ASX STO, MITSUI AND COMPANY LIMITED, APACHE CORPORATION, FIRST OIL EXPRO LIMITED, THE BLACKSTONE GROUP LP, THE CARLYLE GROUP, OAKTREE CAPITAL MANAGEMENT LLC, NATIONAL GRID TRANSCO

IEA head warns low oil prices may threaten energy security

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 15 & 20 : 10-Feb-16

The International Energy Agency’s executive director, Fatih Birol, says investment in oil production is expected to fall by 16 per cent in 2016, following a 20 per cent downturn in 2015. He has warned that some higher-cost projects may be delayed or put on hold if the crude oil price remains at current levels. This in turn could increase reliance on oil from the Middle East, where geopolitical tensions could affect global oil supply. Birol also noted that Australia’s LNG projects will benefit global energy security in the long-term.

CORPORATES
INTERNATIONAL ENERGY AGENCY, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE

Oil, gas jobs on the skids

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Original article by Paul Garvey
The Australian – Page: 20 : 4-Feb-16

A survey of oil and gas industry executives by Norwegian consulting firm DNV GL shows that nearly 75 per cent of respondents expect the crude oil price to remain weak for some time. Meanwhile, 31 per cent indicated that they will shed staff in 2016 to reduce costs, compared with 25 per cent a year ago. The survey also found that 74 per cent of companies with a capitalisation of at least $US5bn intend to reduce their capital expenditure in 2016.

CORPORATES
DNV GL, EXXONMOBIL CORPORATION, BP PLC, WOODSIDE PETROLEUM LIMITED – ASX WPL, SANTOS LIMITED – ASX STO, BEACH ENERGY LIMITED – ASX BPT, DRILLSEARCH ENERGY LIMITED – ASX DLS