PETROLEUM INDUSTRY AND TRADE – AUSTRALIA

Santos could sell PNG gas stake to thwart rival bid: analysts

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Original article by Perry Williams
The Australian – Page: 17 : 4-Aug-21

Santos will have a 42.5 per cent stake in the Papua New Guinea LNG project if its proposed merger with Oil Search proceeds. Tom Allen of UBS has flagged the possibility that Santos could reduce its current stake of 13.5 per cent in the project by 10 per cent; he notes that this would align Santos with its joint venture partners and reduce the risk of that a counterbid for Oil Search will emerge. PNG LNG partners ExxonMobil and Total have been touted as potential bidders for Oil Search.

CORPORATES
SANTOS LIMITED – ASX STO, OIL SEARCH LIMITED – ASX OSH, UBS HOLDINGS PTY LTD, EXXONMOBIL CORPORATION, TOTALENERGIES SE

Santos stalks wounded Oil Search

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Original article by Perry Williams
The Australian – Page: 13 & 16 : 21-Jul-21

Allan Gray Australia’s MD Simon Mawhinney says the board of Oil Search must engage with Santos after the latter revealed on 20 July that it had proposed an all-scrip merger in late June. Oil Search rejected the offer of 0.589 new Santos shares for each of its shares, arguing that it represented a premium of just 6.8 per cent. Mark Samter of MST Marquee agrees that Oil Search directors should have engaged with Santos regarding the bid. Meanwhile, the position of Oil Search chairman Rick Lee is under scrutiny after he told an investor briefing on 19 July that it had not received any takeover approaches. Oil Search subsequently issued a clarification.

CORPORATES
OIL SEARCH LIMITED – ASX OSH, SANTOS LIMITED – ASX STO, ALLAN GRAY AUSTRALIA PTY LTD, MST MARQUEE

CCS critical to attract investment: Santos

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 22 : 9-Jul-21

Santos hopes to make a final investment decision on its proposed $210 million carbon capture and storage project in South Australia by the end of September. The project will have the potential to capture 1.7 million tonnes of carbon a year, and Santos contends that will be the lowest-cost CCS project worldwide. CEO Kevin Gallagher contends that Australia has a competitive advantage when it comes to CCS, and that making the most of this will be vital when it comes to the resources sector continuing to attract overseas investment.

CORPORATES
SANTOS LIMITED – ASX STO

Price gap may trigger wave of oil, gas M&A

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 12 & 14 : 7-Jul-21

Mark Busuttil of JP Morgan believes that some Australian-listed energy producers could become takeover targets due to the growing gap between oil and gas prices and their share prices. Potential targets could include Oil Search, Cooper Energy, Senex Energy and Carnarvon Petroleum. Busuttil says Beach Energy could potentially make a bid for Cooper Energy or Senex Energy, while he suggests that offshore players ExxonMobil and Total would be most likely to target Oil Search.

CORPORATES
OIL SEARCH LIMITED – ASX OSH, COOPER ENERGY LIMITED – ASX COE, SENEX ENERGY LIMITED – ASX SXY, CARNARVON PETROLEUM LIMITED – ASX CVN, EXXONMOBIL CORPORATION, TOTALENERGIES SE

Refinery rescue will cost $2.35bn

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Original article by Ben Packham
The Australian – Page: 4 : 17-May-21

The federal government’s rescue package for the nation’s oil refineries was designed in consultation with Ampol and Viva Energy. The two companies will receive up to $2bn in direct taxpayer funding over the next decade. The variable payments system means that Ampol and Viva will receive greater taxpayer support during periods when their refineries’ margins are low. The government will also provide $302m for the refineries to shift to higher standards three years ahead of schedule. Australia’s two remaining oil refineries employ more than 1,200 people.

CORPORATES
AMPOL LIMITED – ALD, VIVA ENERGY GROUP LIMITED – ASX VEA

Shell plunges to $6bn loss as virus hits

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Original article by Perry Williams
The Australian – Page: 13 & 16 : 26-Apr-21

Shell Australia has posted a full-year loss of $US4.9bn ($6.3bn), compared with a loss of just $US661m previously. The latest financial result was marred by a $US6.2bn writedown of the energy giant’s Australian operations due to a sharp fall in the crude oil price in 2020. The Prelude floating LNG venture was the primary cause of the big writedown. Australian LNG producers have now incurred combined writedowns of more than $25bn in the wake of the pandemic.

CORPORATES
SHELL COMPANY OF AUSTRALIA LIMITED, ROYAL DUTCH SHELL PLC

Smaller loss may not spare embattled Lytton refinery

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Original article by Lachlan Moffet Gray
The Australian – Page: 19 : 15-Jan-21

Ampol will still undertake a review of its Lytton refinery in Brisbane, despite the facility posting a lower-than expected loss for 2020. The refinery’s loss for the calendar year was $20m lower than the consensus forecasts of analysts, at $145m on a replacement cost of sales operating profit basis. The refinery produced 3.469 billion litres of fuel during 2020, compared with 5.8 billion litres in 2019. Ampol has cautioned that the economic outlook in 2021 remains uncertain due to the ongoing impact of COVID-19 on demand for fuel.

CORPORATES
AMPOL LIMITED – ALD

Refinery rescue deal to safeguard fuel stocks

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Original article by Ben Packham
The Australian – Page: 5 : 14-Dec-20

The federal government is set to announce a rescue package for the Lytton, Geelong and Altona oil refineries to ensure that they remain operational until mid-2021. The refineries will receive a payment of at least $0.01 per litre for their petrol, diesel and jet fuel production over the six months from 1 January. Energy Minister Angus Taylor says the government is finalising a long-term market mechanism for the production payment, which is slated to take effect from 1 July. The future of Australia’s three remaining refineries has come under scrutiny following BP’s recent decision to close its Kwinana plant.

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

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

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