US Gulf Poseidon line to fully return soon
US midstream operator Genesis expects normal operations to resume soon on its 350,000 b/d Poseidon oil pipeline connecting several deepwater Gulf of Mexico fields to shore, following a restoration of power onshore in Louisiana and safety checks.
The Poseidon pipeline has been running at "constrained levels," mostly because of the lack of electricity at third-party onshore facilities in Louisiana following Hurricane Ida, but power is expected to be restored later today or tomorrow, Genesis said. Poseidon comes ashore at Houma, Louisiana, which was hit hard by the storm.
Genesis' 500,000 b/d Cameron Highway Oil Pipeline System (CHOPS) has been running since 3 September and is currently shipping some production that would typically flow on the Poseidon line. CHOPS carries Southern Green Canyon (SGC) crude to the Texas coast.
In the second-quarter, the average daily volume on Poseidon was 265,000 b/d while the average daily volume on CHOPS was 205,000 b/d.
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South Sudan eyes restart of Dar Blend crude exports
South Sudan eyes restart of Dar Blend crude exports
London, 17 September (Argus) — South Sudan is aiming to restart exports of its heavy sweet Dar Blend crude through Sudan within weeks, the country's presidency said. Around 100,000 b/d of Dar Blend has been shut in since February because of ruptures and blockages along the Petrodar pipeline which links oil fields in South Sudan to war-torn Sudan's Red Sea export terminal at Bashayer. "Sudanese engineers have accomplished the necessary technical preparations for the resumption of oil production," South Sudan said following a visit by the head of Sudan's army, Abdel Fattah Al Burhan. South Sudan said its engineers are expected to visit Sudan in the coming weeks to "familiarise themselves with the readiness of the facilities so as to jump-start production". Previous attempts to repair and restart pipeline flows have been hampered by the civil war in Sudan, which pits the army against the paramilitary Rapid Support Forces. International efforts to forge a ceasefire have been unsuccessful, with the war now in its 18th month. Production of South Sudan's medium sweet Nile Blend crude grade has not been impacted, as it is transported to Bashayer through the Greater Nile pipeline. Nile Blend now accounts for all of South Sudan's production, which stood at 60,000 b/d in August compared with around 150,000 b/d before the closure of the Petrodar pipeline, according to Argus estimates. The closure of the pipeline has put immense economic strain on South Sudan, which depends on oil sales for more than 90pc of government revenues. Meanwhile, South Sudan has postponed long-delayed national elections scheduled for December by two years. The move is seen by many as a bid by the country's leadership to cling onto power. By Aydin Calik Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
NGL pipeline burning in La Porte, Texas: Update
NGL pipeline burning in La Porte, Texas: Update
Houston, 16 September (Argus) — A natural gas liquids (NGL) pipeline operated by Energy Transfer Partners caught fire in La Porte, Texas, this morning, sending a bright orange plume of flame hundreds of feet into the air and leading to evacuations of nearby homes and businesses. The fire started at a valve station for a 20-inch NGL line, Energy Transfer said, located in a right-of-way shared with a number of other pipelines and high voltage power lines about 17 miles southeast of downtown Houston. Energy Transfer said the line has been isolated so that the residual product in the line can safely burn itself out. "We have no timeline at this point on how long that process will take, but we are working closely with local authorities," the company said. In a broadcast press conference today La Porte officials said it would likely be many hours until the fire burns out. Energy Transfer said it was aware of reports indicating that an unknown passenger car entered the right-of-way and struck the valve location. A vehicle could be seen very close to the flaring pipeline in video broadcasts of the fire this morning. The fire was first reported at 11:24am ET by the La Porte Office of Emergency Management via the X social media platform. The fire is near the intersection of Somerton Drive and Spencer Highway. First responders, including Harris County hazardous materials officials, were on the scene at the time of the post. The right-of-way includes a refined products pipeline system, various petrochemical pipelines, a Shell butadiene line, a Chevron ethylene line and an Enbridge Energy natural gas pipeline. Chevron said its pipeline was not affected by the fire. A shelter-in-place order has been issued for the nearby San Jacinto College campus and La Porte is recommending an evacuation of all homes and businesses between Luella and Canada roads. By Michael Camarda and Gordon Pollock Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Pipeline fire reported in La Porte, Texas
Pipeline fire reported in La Porte, Texas
Houston, 16 September (Argus) — A pipeline fire is underway in La Porte, Texas, near a junction of several refined products, NGLs, chemicals, and natural gas pipelines. The fire, which was first reported at 11:24am ET by the La Porte Office of Emergency Management via the X social media platform is near the intersection of Somerton Drive and Spencer Highway, near a dense collection of pipelines. First responders, including Harris County hazardous materials officials, were on the scene at the time of the post. Large orange flames coming from a compressor station were visible on local news broadcasts and on social media. The source of the fire is not immediately clear. The right of way includes a refined products pipeline system, various petrochemicals pipelines, a Shell butadiene line, a Chevron ethylene line, as well as an Energy Transfer-owned natural gas liquids (NGLs) line and an Enbridge Energy natural gas pipeline. The city of La Porte was not immediately available for comment. A shelter in place order has been issued for the nearby San Jacinto College campus and La Porte is recomending an evacuation between Luella and Canada roads. By Gordon Pollock Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Shale sector consolidation far from over
Shale sector consolidation far from over
New York, 16 September (Argus) — After a blockbuster year for US oil and gas deals, the pace of acquisitions is unlikely to ease as assets in basins outside the Permian increasingly catch the eye of potential suitors. A slight pause is expected around the presidential elections in November, before transactions — which have surpassed $100bn so far in 2024 — pick up through to the end of the year and into 2025, both in terms of takeovers and recent acquirers looking to dispose of assets that no longer compete for capital in their combined portfolios. The initial rush of deal-making in the Permian basin of west Texas and southeastern New Mexico, which kicked off in late 2023, has now spread to other regions across the shale patch. "What's driving that is really operators are focused on consolidating operations in the areas that they're already operating in," consulting firm Ernst & Young's strategy and transactions energy partner, Bruce On, says. The opportunities to make savings by leveraging and sharing logistical networks, supply chains, technology and experience around drilling and well completions have been key drivers as capital discipline remains the sector's guiding light. While the Permian was the focal point of deal-making in the second half of 2023 — with transactions in excess of $89bn and accounting for 92pc of total deal-making — that is no longer the case, according to consultancy Rystad Energy. The Permian's share of overall mergers and acquisitions (M&A) fell to 46pc in the first half of 2024 and was about 18pc in the second half, as of the end of August, Rystad says. "This declining share is attributed to the limited remaining opportunities in the basin, which has also resulted in tougher competition among potential buyers and premium valuations," Rystad vice-president for upstream Atul Raina says. The shift has seen other basins come to the fore, such as North Dakota's Bakken, Pennsylvania's Marcellus and South Texas' Eagle Ford. The share of deal value in the Bakken rose to 12pc of all M&A transactions in the first half of 2024, from virtually nothing in the second half of 2023, Rystad says. The Marcellus accounted for 14pc of deal-making and Eagle Ford 13pc, over the same period. Permian envy Examples of buyers looking further afield include US independent SM Energy, which bought assets in Utah's Uinta basin from private equity-backed XCL Resources for $2bn. "We'd love to add that kind of asset in the Permian," SM Energy chief financial officer Wade Purcell says. "Getting something of size anywhere near that price, that's really hard right now." As part of the latest acquisition spree, recent buyers are looking to see how their combined asset base fits and what they want to offload. "They're quickly looking to go to market with those non-core assets, so we expect to see this cycle that will accelerate additional M&A activity in the sector," Ernst & Young's On says. Just this week, US independent producer APA announced the sale of non-core Permian assets to an undisclosed buyer for $950mn. That built on the company's sale of other Permian and Eagle Ford assets for a combined $700mn earlier this year. "Through multiple transactions completed this year, we have high-graded and focused our US asset base," chief executive John Christmann says. The proceeds will go towards paying down debt taken on as part of APA's $4.5bn all-stock takeover of Permian-focused Callon Petroleum at the start of the year. More than $46bn worth of upstream assets remain on the market in the US, with shale accounting for 80pc of the total, according to Rystad. Private equity-backed operators are likely to keep selling off assets to take advantage of rising demand from public peers to add inventory and build scale. By Stephen Cunningham Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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