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LNG Energy eyes sanctions-hit Venezuela oil blocks

  • Market: Crude oil, Natural gas
  • 25/04/24

A Canadian firm plans to revive two onshore oil blocks in Venezuela, but the conditional deals signed with struggling state-owned PdV come just as the US is reinstating broad sanctions on the South American country.

LNG Energy Group's Venezuela unit agreed two deals with PdV to boost output in five fields in the Nipa-Nardo-Niebla and Budare-Elotes blocks, which produce about 3,000 b/d of light- to medium-grade crude, the company said on Wednesday. The Canadian company, which operates in neighboring Colombia, would receive 50-56pc of production of the blocks.

Venezuela's oil ministry declined to comment.

But finalizing the contracts depends on providing required investment to develop the fields within 120 days of the contract signing on 17 April, LNG Energy said. And the signing came on the same day as the US reimposed oil sanctions on Venezuela and gave most companies until 31 May to wind down business.

LNG Energy Group said it intends to comply with existing and upcoming US sanctions, noting that the conditional contracts were executed within the terms of the temporary lifting of sanctions — general license 44 — but it will abide by the new license 44A.

The reimposition of US sanctions on Venezuela prohibits new investment in the country's energy sector, at the threat of US criminal and economic penalties.

"The company will assess in the coming days the applicability of license 44A to its intended operations in Venezuela and determine the most appropriate course of action," LNG Energy said. "The company intends to operate in full compliance with the applicable sanctions regimes."

The two blocks are in the adjacent Anzoategui and Monagas states, part of the Orinoco extra heavy oil belt. Most of Venezuela's output is medium- to heavy-grade crude.

Both PdV and Chevron have drilling rigs working in those two states, in separate workover and drilling campaigns. Venezuela is now producing above 800,000 b/d, after the US allowed Chevron to increase production and investment under separate waivers.


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24/07/24

Indian budget lifts spending for refining, crude SPR

Indian budget lifts spending for refining, crude SPR

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Repsol 2Q profit doubles but cash flow turns negative


24/07/24
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24/07/24

Repsol 2Q profit doubles but cash flow turns negative

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Equinor 2Q profit supported by higher European output


24/07/24
News
24/07/24

Equinor 2Q profit supported by higher European output

London, 24 July (Argus) — Norway's state-controlled Equinor posted a small rise in profit on the year in the April-June period, as a lift in its European production offset lower gas prices. Equinor reported a profit of $1.87bn in the second quarter, up by 2.2pc on the year but down by 30pc from the first three months of 2024. The company paid two Norwegian corporation tax instalments, totalling $6.98bn, in the second quarter, compared with one in the first quarter. Equinor paid $7.85bn in tax in April-June in total. Its average liquids price in the second quarter was $77.6/bl, up by 10pc from the second quarter of 2023. But average gas prices for Equinor's Norwegian and US production fell in the same period by 17pc and 6pc, respectively. The company noted "strong operational performance and lower impact from turnarounds" on the Norwegian offshore, including new output from the Breidablikk field . Equinor's entitlement production was 1.92mn b/d of oil equivalent (boe/d) in April-June, up by 3pc on the year. The company cited "high production" from Norway's Troll and Oseberg fields in the second quarter, as well as new output from the UK's Buzzard field. But US output slid, owing to offshore turnarounds and "planned curtailments onshore to capture higher value when demand is higher", the company said. It estimates oil and gas production across 2024 will be "stable" compared with last year, while its renewable power generation is expected to increase by around 70pc across the same timespan. Equinor's share of power generation rose by 14pc on the year to 1.1TWh in April-June. Of this, 655GWh was renewables — almost doubling on the year — driven by new onshore wind capacity in Brazil and Poland. "Construction is progressing" on the UK's 1.2GW Dogger Bank A offshore windfarm , Equinor said. It is aiming for full commercial operations in the first half of 2025 at Dogger Bank A — a joint venture with UK utility SSE. Equinor was granted three new licences in June to develop CO2 storage in Norway and Denmark. The Norwegian licences — Albondigas and Kinno — together have CO2 storage potential of 10mn t/yr. The Danish onshore licence, for which Equinor was awarded a 60pc stake, has potential capacity of 12mn t/yr. Equinor has a goal of 30mn-50mn t/yr of CO2 transport and storage capacity by 2035. The company's scope 1 and 2 greenhouse gas (GHG) emissions amounted to 5.6mn t/CO2 equivalent (CO2e) in the first half of the year, edging lower from 5.8mn t/CO2e in January-June 2023. It also incrementally cut its upstream CO2 intensity, from 6.7 kg/boe across 2023, to 6.3 kg/boe in the first half of this year. Equinor has kept its ordinary cash dividend steady , at $0.35/share, and will continue the extraordinary cash dividend of $0.35/share for the second quarter. It will launch a third $1.6bn tranche of its share buyback programme on 25 July. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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US House passes waterways bill


23/07/24
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23/07/24

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Gas discovery could extend Bolivia's export life


22/07/24
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22/07/24

Gas discovery could extend Bolivia's export life

Sao Paulo, 22 July (Argus) — The estimated 1.7 Tcf of natural gas in Bolivia's Mayaya Centro-X1 field would expand the country's exporting capacity in 4-5 years but not much beyond that, according to market participants. The discovery — the largest find in Bolivia since 2005 and the first in the north of the country — was well-received in Bolivia and in neighboring countries. But some are skeptical about whether it actually holds 1.7 Tcf. "The government may be jumping to conclusions given the elements available so far," a hydrocarbons market consultant told Argus . Prior to the discovery, Bolivia was expected to cease exporting gas in 2030. By then, considering proved reserves, production will only be enough to supply domestic demand. Additionally, there are some logistics concerns, as the region around the Mayaya Centro-X1 field has no infrastructure for further exploration or pipeline transport systems. The mayor of the Bolivian capital La Paz, Iva Arias, said a hydrocarbons field would take 2-5 years to produce and start yielding royalties for the city. But if the reserves are indeed proven, the discovery would change Bolivia's natural gas reality, as its reserves dropped by around 70pc in the last decade. The expectations surrounding the find are added to the increasingly public animosity between President Luis Arce and former-president Evo Morales, his former boss. Both are claiming credit for the discovery and will use it to promote their 2025 presidential runs . Bolivia is still the largest exporters of natural gas to Brazil. State-controlled Petrobras and Bolivia's state-owned YPFB are partners in four Bolivian fields. Only four days prior to Mayaya Centro-X1 announcement, newly-appointed Petrobras chief executive Magda Chambriard visited Bolivia with Brazilan President Luiz Inacio Lula da Silva and announced plans to invest $40mn to drill an exploratory well in San Telmo Norte in 2025. Brazilian company Flxus also plans to invest in Bolivian gas . By Betina Moura Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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