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Francine sets sights on Louisiana coast: Update

  • : Crude oil, Freight, Natural gas
  • 24/09/11

Updates the status of ports in Texas.

Hurricane Francine, which has already shut in almost a quarter of the Gulf of Mexico's oil output, is set to strengthen before making landfall in Louisiana on Wednesday evening.

Francine was about 150 miles southwest of Morgan City, Louisiana, according to an 10am ET advisory from the National Hurricane Center, with maximum sustained winds of 90 mph. The hurricane will bring 5-10 foot storm surge to coastal areas from Vermillion Bay to Port Fourchon, Louisiana, and after landfall is expected to move northward across Mississippi on Thursday and Thursday night bringing heavy rains.

Ports along the hurricane's path announced traffic restrictions in advance, with some setting out plans to close until it passes, including the port of New Orleans.

With the storm's track locked in toward Louisiana, the port of Houston was expected to reopen to inbound vessels at 1pm ET today and to outbound vessels at 3:30pm, a ship agent said. It closed to traffic at 1pm Tuesday. The ports of Beaumont, Port Arthur and Orange also plan to reopen Wednesday.

About 412,070 b/d of offshore oil output was off line by midday on Tuesday, according to the Bureau of Safety and Environmental Enforcement (BSEE), as offshore operators including Chevron, Shell and ExxonMobil evacuated workers and curbed operations as a precaution. About 494mn cf/d of natural gas production, or 26pc of the region's output, was also off line.

The Gulf of Mexico accounts for around 15pc of total US crude output and 5pc of US natural gas production.


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CNRL to buy Chevron's Canadian oil sands, shale: Update


24/10/07
24/10/07

CNRL to buy Chevron's Canadian oil sands, shale: Update

New York, 7 October (Argus) — Canadian Natural Resources (CNRL) agreed to buy a 20pc stake in the Athabasca Oil Sands Project (AOSP) and 70pc interest in the Duvernay shale from Chevron for $6.5bn, extending its lead as Canada's top producer. The all-cash transaction has an effective date retroactive to 1 September, the companies said Monday. Closing is expected during the fourth quarter. The assets being sold accounted for about 84,000 b/d of oil equivalent (boe/d) of production, net of royalties, to Chevron last year. Chevron last October announced plans to acquire US independent Hess for $53bn, pledging to sell $10bn-$15bn of assets by 2028. While the Hess deal has been delayed by a mid-2025 arbitration hearing, Chevron, the second-largest US oil producer, has increasingly focused its attention on the Permian shale basin of west Texas and southeastern New Mexico, as well as an expansion project in Kazakhstan. CNRL's acquisition bolsters its position as Canada's largest petroleum producer after pumping out 1.29mn boe/d of oil and gas in the second quarter this year. About 72pc came from oil and natural gas liquids (NGLs), with the balance from natural gas. CNRL anticipates the oil sands and Duvernay assets will lift the company's production profile by about 122,500 boe/d in 2025. About half, or 62,500 b/d, will come in the form of synthetic crude oil produced from AOSP's 320,000 b/d Scotford upgrader near Edmonton, Alberta. The upgrader is fed diluted bitumen piped from the Muskeg River and Jackpine mines in the oil sands region. The deal would increase CNRL's stake in AOSP to 90pc. Calgary-based CNRL first made its foray into AOSP in 2017 when it bought a 70pc stake from Shell and Marathon Oil Canada for $9.75bn ($C$12.74bn). Muskeg River and Jackpine are adjacent to the company's fully owned Horizon mine and upgrader, and the increase in ownership may allow for increased synergies between the two assets, according to executives. "It allows for a little bit more ease in terms of governance on the asset," CNRL president Scott Stauth said Monday on an investor call. "I can see us utilizing the equipment more effectively between the two sites." Undeveloped oil sands projects Also included in Monday's deal are additional stakes in undeveloped oil sands leases that CNRL could tap as it works through its reserves. This includes a 20pc increase the Pierre River project that would provide CNRL with 90pc ownership; a 60pc increase in the Ells River project that would lift the company's stake to 90pc; a 33pc increase in the Saleski project, for 83pc; and a 6pc working interest in Namur that would reach 65pc. Reserves from Pierre River could be used to extend the life of the Horizon project as the North Mine depletes. A standalone facility there is also possible, but would require a significant capital outlay, CNRL executives said. CNRL in May said it was considering a massive 195,000 b/d increase to its Horizon production using two new technologies. CNRL said production from the light oil and liquids rich assets in the Duvernay is expected to average 60,000 boe/d in 2025, half of which would be natural gas. CNRL anticipates pushing production to 70,000 boe/d by 2027 with more than 340 locations already identified as candidates for drilling. With WTI above $70/bl, "this is a very attractive acquisition for us," CNRL chief financial officer Mark Stainthorpe said. CNRL has been actively acquiring assets in recent years. The company purchased Canadian assets belonging to Painted Pony in 2020, Devon Energy in 2019, TotalEnergies in 2018 and Cenovus Energy in 2017, among other deals. By Stephen Cunningham and Brett Holmes Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Florida ports preparing for Hurricane Milton


24/10/07
24/10/07

Florida ports preparing for Hurricane Milton

Houston, 7 October (Argus) — Ports on Florida's Atlantic and Gulf coasts closed to inbound vessel traffic Monday in preparation of Hurricane Milton, which strengthened into a category 5 storm . The US Coast Guard late Sunday set condition X-Ray at ports from Jacksonville, on Florida's Atlantic coast, to Panama City, on the state's Gulf coast. This means gale force winds (39-54mph) were forecast within 48 hours. All commercial traffic and transfer operations can continue during X-Ray, but the Coast Guard said ocean-going commercial vessels greater than 500 gross tons should make plans to depart the port or request permission from authorities to remain in port. Incoming vessel traffic is prohibited without Coast Guard permission. A ship agent expects the Coast Guard to set port condition Yankee from Miami to Tampa on Monday evening, which would mean gale force winds within 24 hours. Milton, with maximum sustained winds of 160 mph, was about out 130 miles west of Progreso, Mexico, according to an 11am ET National Hurricane Center advisory. The storm is forecast to make landfall in Florida on Wednesday. By Tray Swanson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Chevron shuts Gulf platform ahead of Hurricane Milton


24/10/07
24/10/07

Chevron shuts Gulf platform ahead of Hurricane Milton

New York, 7 October (Argus) — Chevron evacuated and shut in its Blind Faith oil and gas production platform in the Gulf of Mexico in advance of Hurricane Milton, which has strengthened into a category 5 storm as it barrels toward Florida's west coast. Output from Chevron's other operated facilities in the region remains at normal levels, the company said today. The 65,000 b/d Blind Faith platform is located around 160 miles southeast of New Orleans. Milton, with maximum sustained winds of 160 mph, was about out 130 miles west of Progreso, Mexico, according to an 11am ET National Hurricane Center advisory. The storm will move through the Campeche Bank offshore region north of Mexico's Yucatan peninsula — where state-owned Pemex's largest oil and natural gas production operations are located — today and Tuesday, then cross the eastern Gulf of Mexico and approach the west coast of the Florida Peninsula by Wednesday. On its current track, the hurricane is expected to skirt to the south of the majority of US offshore oil and natural gas platforms in the Gulf of Mexico. The region accounts for around 15pc of total US crude output and 5pc of US natural gas production. Hurricane Helene temporarily shut in up to 29pc of oil production and 20pc of gas output in the Gulf of Mexico late last month. By Stephen Cunningham Hurricane Milton projected path Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Concerns remain over plans of firm tapped to run Citgo


24/10/07
24/10/07

Concerns remain over plans of firm tapped to run Citgo

London, 7 October (Argus) — The top bidder in the auction for Venezuelan state-run PdV's US refining subsidiary, Citgo, says it plans to reinvest in its 804,000 b/d of refining capacity, but concerns remain over the private equity-backed buyer's intentions. Amber Energy was selected on 27 September as the top bidder in an auction for the seventh-largest US refiner, with a bid of $7.3bn. The company, backed by investors including Elliott Investment Management, says it would focus on "enhancing the value of its [Citgo's] core assets" by prioritising "operational excellence", reinvesting in the business and pursuing "strategic investments". Amber is led by industry veterans Gregory Goff and Jeff Stevens. The latter was chief executive of Western Refining from 2010-17, while Goff ran refiner Andeavor from 2010-18, during which time it changed its name from Tesoro, bought Stevens' Western Refining and was then bought by Marathon Petroleum. Goff and Stevens' refining pedigree has not allayed concerns in the market that one of their investors, Elliott, and other undisclosed backers, want to split up the assets and sell them for a combined price higher than the investment group's $7.3bn bid. Elliott's track record of activist investing in North American refiners shows a clear preference for improving the core business of processing crude into fuels, with little interest in what the investment firm views as non-core assets. Elliott pushed Canadian integrated energy company Suncor in 2022 for board changes and divestment of its 1,500 retail stores, which it ultimately did not sell. The firm had more luck with Marathon, which agreed to sell its 3,900-store Speedway network in 2019, the year after it bought Andeavor. Last year, Elliott purchased a $1bn stake in Phillips 66 and called for the company to refocus on its refining business and reduce operating costs. Phillips 66 divested some of its retail network and pipelines this year. The investment group, which started out trading in the 1970s but has since expanded into a multi-strategy hedge fund and private equity firm, has shown a clear preference for merchant refiners within its activist investments, and criticised the strategy of integrated refining companies. It is not clear whether that preference carries through to its private-markets investment in Amber, which could also be eyeing an initial public offering for the assets down the line. Elliott did not respond to requests for comment on its strategy. A spokesperson for Amber declined to discuss details of the company's strategy on the record. Seeking closure Amber said it expects the sale to close in mid-2025, pending regulatory approval and a final recommendation by the US Court for the District of Delaware. But investors involved in the auction process and other downstream operators told Argus that higher bids from other refiners or groups are likely, as Amber's bid is considered relatively low for what are widely viewed as attractive refining assets. The auction comes at a time of flatlining domestic demand for road fuels such as gasoline, and ongoing worries about the future of the US refining industry, where smaller and less profitable plants are the most likely to shutter operations. But Citgo's two Gulf coast assets — a 455,000 b/d refinery in Louisiana and a 165,000 b/d plant in Texas — are large, complex refineries that could benefit from access to export markets as domestic demand wanes and the Gulf coast readies for the 2025 closure of LyondellBasell's 264,000 b/d Houston plant. Citgo's 184,000 b/d Lemont refinery in Illinois could gain access to cheap Canadian heavy crude and sell products to the US market when major plants such as ExxonMobil's 252,000 b/d Joliet refinery in Illinois and BP's 435,000 b/d Whiting facility in Indiana are off line owing to outages or maintenance. By Nathan Risser Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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