Lebanese exploration blocks in limbo

  • Spanish Market: Crude oil, Natural gas
  • 21/02/24

The fate of two exploration blocks offshore Lebanon remains in limbo, with the government yet to agree contractual terms with the consortium that bid for the licences last year, the country's energy minister Walid Fayad said.

A consortium consisting of TotalEnergies, Italy's Eni and state-owned QatarEnergy submitted bids to explore Blocks 8 and 10 in October last year as part of Lebanon's second licensing round. The blocks lie on Lebanon's recently delineated border with Israel.

The same consortium drilled an exploration well in the adjoining Block 9 in August last year but failed to find any commercial volumes of oil or gas.

Speaking on the sidelines of the Egypt Energy Show in Cairo, Fayad said the main issue with the bids for Blocks 8 and 10 relates to timeframes for 3D seismic surveys and drilling decisions. TotalEnergies' insistence on a one-year period to decide whether it would shoot 3D seismic on Block 8 is too long, Fayad said. The government's position is that three months should be more than enough, he added.

"For Block 10, they're asking for two years to make a decision whether to drill or not. And we're saying you don't need to, you can do it in one year," Fayad said. "That's why they did not sign."

TotalEnergies has yet respond to a request for comment.

It is unclear whether there will be any further negotiations for Blocks 8 and 10, both of which have been included in Lebanon's third licensing round launched late last year.

Fayad said interest in the latest bid round "has yet to be elicited", which is why he is proactively engaging with companies and countries. "It's an uphill battle," he said.

The conflict in Gaza is making it more difficult to create a stable environment for the eastern Mediterranean's oil and gas sector to grow, Fayad said.

"It makes risk a lot higher, it makes the financing cost a lot higher, and it makes any investment decision a lot more cumbersome. It is crippling the region," he said.


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22/05/24

Mexico crude exports up after Tula refinery outage

Mexico crude exports up after Tula refinery outage

Mexico City, 22 May (Argus) — Mexican crude exports have bounced back in May after a power outage hit state-owned Pemex's 315,000 b/d Tula refinery last week, likely freeing more crude for the export market. Crude exports rose to about 838,000 b/d so far in May, up by 18pc from full-month April but still 22pc lower compared with all of May 2023, according to trade analytics firm Kpler data. The month-over-month hike was likely supported by a power outage at the Tula refinery on 13 May, which affected up to 20 processing plants, according to market sources. It remains unclear if the refinery has resumed operations, but sources said the restart could take about two weeks. The Tula refinery, which supplies refined products to Mexico City's metropolitan area, processed 246,500 b/d of crude in March, of which 182,000 b/d, or 74pc, was medium or light sour crude, according to the latest Pemex data. Medium and light sour crude exports rose by 13pc to 336,000 b/d so far in May from the previous month, Kpler data show. Additionally, fires at the Salina Cruz and Minatitlan refineries in late April could have also added to the uptick of crude exports. Mexico this year trimmed crude exports to feed its domestic refineries as President Andres Manuel Lopez Obrador seeks to cut fuel imports in his final year in office, in line with his campaign promise to make Mexico more energy independent. Pemex's six domestic refineries processed over 1mn b/d in March for the first time in almost eight years, driven by billion-dollar investments in maintenance since 2019 and the cut in crude exports. The start-up of the new 340,000 b/d Olmeca refinery could further reduce crude exports, but the refinery still faces multiple delays . By Antonio Gozain Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

UK general election set for 4 July


22/05/24
22/05/24

UK general election set for 4 July

London, 22 May (Argus) — A general election will take place in the UK on 4 July, prime minister Rishi Sunak said today. The announcement coincides with official data showing that UK inflation has fallen to its lowest level in nearly three years. Labour, the country's main opposition party led by Keir Starmer, has held a substantial lead in polls in recent months and performed well in local elections earlier this month. It won nearly 200 seats on local councils, as well as several regional mayoral contests, while the ruling Conservative Party lost almost 500 council seats. The Conservatives have been in power since 2010 and have fielded five prime ministers during that time. The two main parties are likely to release more detailed manifestos once the election campaign begins, but their current respective energy policies have many similarities. Both back a windfall tax on oil and gas producers and support nuclear power. They both also support offshore wind and solar power, although Labour has incrementally more ambitious targets for those renewables and has plans for more onshore wind. Labour also wants a zero-carbon power grid by 2030 , while the Conservatives are aiming for that in 2035. The Conservatives have rolled back some climate policy since Sunak became prime minister, while Labour in February backed down on its pledge to spend £28bn/yr ($35.6bn/yr) on the country's energy transition, if it wins the election. For a general election to take place in the UK, the prime minister must request permission from the British monarch — King Charles III — who then dissolves parliament. A general election must take place at least once every five years in the UK, although a prime minister can call one at any point. The UK's last general election was held on 12 December 2019 and Boris Johnson was elected prime minister. There have since then been two prime ministers — Liz Truss in September-October 2022 — and Sunak. Truss was selected by Conservative Party members and Sunak became prime minister in October 2022 after the only other candidate withdrew from the leadership contest. The Conservatives hold 344 seats out of 650 in the House of Commons, the UK's lower house of parliament. But 105 members of parliament have said that they will not run at the next election, 66 of whom are Conservatives. By Georgia Gratton Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US crude stocks rise by 1.8mn bl last week: Update


22/05/24
22/05/24

US crude stocks rise by 1.8mn bl last week: Update

Adds report details starting in seventh paragraph. Calgary, 22 May (Argus) — US crude inventories rose by 1.8mn bl last week on a sizable build in the Gulf coast region, the Energy Information Administration (EIA) reported today. Crude stocks across the US came in at 458.8mn bl in the week ended 17 May, up from 457mn bl a week earlier. Inventories were up by by 3.7mn bl compared to a year earlier. Stocks in the US Gulf coast rose on the week by 3.6mn bl to 261.5mn bl, approaching a 12-month high set in the week ended 26 April when stocks were at 261.6mn bl. The week-over-week build in the US Gulf coast ranks as the fifth largest through the first 20 weeks of the year. Inventories at the Cushing storage hub in Oklahoma rose by 1.3mn bl to 36.3mn bl, but that was still 910,000 bl lower than the same week in 2023. Crude inventories at the US Strategic Petroleum Reserve (SPR) increased by 993,000 bl to 368.8mn bl, the largest weekly build so far this year. SPR stocks are not included in the overall EIA commercial crude inventory figures. US crude exports rose last week by 595,000 b/d to 4.7mn b/d, while imports fell by 81,000 b/d to 6.7mn b/d. Net imports fell by 676,000 b/d to 1.9mn b/d as a result. Domestic crude output was steady at 13.1mn b/d. US crude refiners processed about 16.9mn b/d last week, up by 241,000 b/d from the week prior and the highest since the week ended 12 January. Runs were 354,000 b/d higher than the same week in 2023. Refinery utilization rates on average rose to 91.7pc nationwide, up from 90.4pc in the prior week and 91.7pc in the same week of 2023. Refiners in the midcontinent and Gulf coast regions drove the weekly gains, each climbing to multi-month highs. Utilization rates in the midcontinent rose to 94.8pc from 90.8pc in the week prior while rates in the Gulf coast climbed to 93.7pc from 92.7pc. By Brett Holmes US weekly crude stocks/movements Stocks mn bl 17-May 10-May ±% Year ago ±% Crude oil (excluding SPR) 458.8 457.0 0.4% 455.2 0.8% - Cushing crude 36.3 35.0 3.8% 37.2 -2.4% Imports/exports '000 b/d Crude imports 6,663 6,744 -1.2% 5,850 13.9% Crude exports 4,730 4,135 14.4% 4,549 4.0% Refinery usage Refinery inputs '000 b/d 16,894 16,653 1.4% 16,540 2.1% Refinery utilisation % 91.7 90.4 1.4% 91.7 0.0% Production mn b/d 13.1 13.1 0.0% 12.3 6.5% — US Energy Information Administration Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Japan’s Mol adds to LNG fleet for Jera


22/05/24
22/05/24

Japan’s Mol adds to LNG fleet for Jera

Osaka, 22 May (Argus) — Japanese shipping firm Mitsui OSK Lines (Mol) is to launch a new LNG carrier in 2026, the seventh vessel to be supplied under an unspecified time charter agreement with the country's largest power producer by capacity Jera. The 174,000m³ membrane-type vessel is being built by South Korean shipbuilder Samsung Heavy Industries at its Geoje shipyard. It will be installed with a dual-fuel engine that can run on low-sulphur fuel oil or boil-off gas stored in the ship's cargo tank, Mol said. LNG is dominant in Jera's power portfolio, with its gas-fired output accounting for 75pc of its power generation in the April 2023-March 2024 fiscal year. The company consumed around 23mn t of LNG during 2023-24, which accounted for 35pc of Japan's LNG imports of 64.9mn t. Jera is planning to maintain its LNG handling volumes at no less than 35mn t/yr until 2035-36 , so to ensure power security in Japan through more flexible operations. It is also looking to further promote LNG along with renewable electricity in Asian countries, while helping to reduce their dependence on coal- and oil-fired power generation. By Motoko Hasegawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Shell to develop new gas wells for Australia’s QGC


22/05/24
22/05/24

Shell to develop new gas wells for Australia’s QGC

Perth, 22 May (Argus) — Shell has begun work on new coal-bed methane wells for its Queensland-based gas division QGC, which services domestic customers and exports through its two-train 8.5mn t/yr Queensland-Curtis LNG (QCLNG) project. Around 138 new wells with an estimated 15-year lifespan will be drilled and connected in the state's Western Downs region, across existing tenements in the onshore Surat basin in the central, southern and northern development areas. Preparations for drilling will start during October-December with construction planned to be under way for January-March 2025 and take approximately two years. Federal and state environmental approvals are already in place for the infill and backfill development, a Shell spokeswoman said on 22 May. Shell reported output rose from a year earlier and the previous quarter for its LNG sector in January-March with 7.58mn t of LNG produced in the first quarter, of which 3.55mn t or 47pc was from its Oceania division. This includes QCLNG and the 3.6mn t/yr Prelude floating LNG offshore northwest Australia, which resumed exports in late 2023 following a major turnaround in the second half of 2023. By Tom Major Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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