Oilexco Share Discussion Threads

[waldron] 06/5/2018 09:15

LOOKS LIKE THE STORM SEASON WILL SOON BE UPON US

HOPE NOT TOO SEVERE THIS YEAR

[ariane] 04/5/2018 23:24

2018 01:09 AM
Business Eco./Bus. News
RELATED STORIES
BIG
The Royal Dutch Shell headquarters in The Hague. The world’s biggest companies from Royal Dutch Shell to Chevron Corp are starting to churn out profit like it is $100-a-barrel oil again.
Rate
Text Size: A A A

Bloomberg/London

Big Oil’s investors took a bruising for nearly three years as oil prices bumped along decade lows. Now they want payback.
They’re willing to punish companies that don’t meet their standards, and their standards are awfully high. On their wish list: immediate returns, spending discipline, and, at the same time, more production. Here are three big takeaways from a mixed earnings season, where demands on Big Oil were laid bare.
Profit isn’t enough: The world’s biggest companies from Royal Dutch Shell to Chevron Corp are starting to churn out profit like it is $100-a-barrel oil again. They have trimmed a lot of fat built up during the heady days of oil as they raced each other to construct hyper-engineered mega-projects.
But, that’s no longer enough for investors. The goalposts have moved and now they mostly care about cash.
Shell’s first-quarter earnings soared 42% from a year earlier, beating analysts’ estimates. Still, cash flow from operations was lighter than expectations and the shares were hammered.
Only half of the companies reporting dazzling earnings saw their stock rise. The problem? Investors are looking for immediate gratification after enduring the oil-price downturn.
They also do not fully believe the companies can continue to keep a leash on their purse strings now that crude is rebounding. “The investment community still is not sure we’re going to handle these higher prices with discipline,” BP Plc chief executive officer Bob Dudley said at a conference last week. A longer track-record of prudent action is more important.
Caution not rewarded: Dudley and his counterpart at Shell, Ben van Beurden, are among oil-company bosses who have pledged to maintain their hard-earned cost discipline. So, investors should be happy, right? Not necessarily.
Shareholders think Shell’s cash-flow issues are likely to affect something close to their hearts: buybacks. Chief financial officer Jessica Uhl was swamped with questions about the timing of the $25bn share repurchase programme by both analysts and reporters. All they got was that she wanted to focus on reducing borrowings. Earlier, debt was investors’ primary concern after Shell’s $50bn acquisition of BG Group Plc in 2016.
Demanding more oil: If delayed buybacks make investors mad, then missing earnings estimates make them furious. Ask Exxon Mobil Corp. The world’s biggest publicly traded oil company reported that while profit increased, it fell short of forecasts. It even missed the mark on production, the first sub-4mn barrels a day figure for that time of year since Bill Clinton was president. It couldn’t even keep pace on chemicals.
The result is partly the consequence of one bad bet. The company invested heavily in exploring Russia, only to shelve all of its plans when the country was hit by US sanctions after the annexation of Crimea. Exxon responded to investor concerns by saying earlier this year it will boost spending to unlock more barrels of oil. However, that’s not passing muster either. Its shares have dropped in all three trading days after the first-quarter earnings. The company has lost about $53bn in market value since it posted disappointing fourth-quarter results three months ago. That’s more than the market capitalisation of the Ford Motor Co.
“The quarter did not quite live up to high expectations following strong” oil prices, said Rob West, a London-based analyst at Redburn (Europe).

[sarkasm] 04/5/2018 19:01

Total to boost exploration efforts in South Africa as fuel network grows
By Paul Burkhardt on 5/4/2018

JOHANNESBURG (Bloomberg) -- French energy giant Total SA plans to boost oil exploration and open more fuel stations in Africa’s most industrialized country.

Total pumped a record amount of oil and gas in the first quarter and expects output growth to exceed its 6% target this year thanks to acquisitions and new projects from the Arctic to West Africa. In South Africa, the company plans to expand its network of more than 500 fuel stations and finish a deepwater exploration well started in 2014.

"In retail, we clearly want to grow and to grow by 200 to 300 service stations in the coming few years," Pierre-Yves Sachet, managing director and CEO for Total South Africa, said Thursday in an interview at his office in Johannesburg. "The intensity of our footprint is not exactly the one we would like to have yet."

Total, which is already due to open 20 new retail outlets this year, is considering partnerships to increase that number. It faces competition from South Africa’s Sasol Ltd., which is also looking to expand its fuel-station network in a country that currently has about 4,600 outlets.

Total is also interested in supplying liquefied natural gas and adding solar projects as part of two government programs that faced delays under former South African President Jacob Zuma. While there hasn’t yet been a marked change in demand and investment under Cyril Ramaphosa, who replaced Zuma in February, there is a difference in the business community, according to Sachet.

“There’s more confidence in the atmosphere, this is very clear," said Sachet, who sees growth in the company’s sales of fuel and lubricants to mining companies.

Total, which owns 36% of the 108,000-bpd Natref refinery in a joint venture with Sasol, expects to resume drilling on South Africa’s first deepwater well by the end of this year or first quarter 2019, said Sachet. It was forced to suspend operations in 2014 because of strong currents.

The results will be watched by fellow majors ExxonMobil Corp. and Eni SpA, which also have offshore stakes in South Africa. Royal Dutch Shell Plc relinquished a license last year.

Petroleum Agency South Africa, the industry regulator, has blamed lower oil prices and uncertainty about pending legislation, including the Mineral and Petroleum Resources Development Amendment Bill, for curbing investment in exploration.

Total in October also acquired a stake in blocks off Namibia and in South Africa’s Orange basin.

[sarkasm] 04/5/2018 17:46

Oil majors – shuffling along the Road to Damascus

Published 04 May 2018 Last Updated 04 May 2018 14:00

Angus Leslie Melville Contact Author

Tags Oil & Gas Renewables Asia Pacific Europe North America

Share:

Export:

Skip to:
Article Snapshot

In a volte-face that’s enough to make a North Korean dictator blush, the oil majors are continuing to trip over their feet in a bid to reinvent themselves as good guys, having spent the last century-plus playing the black-hat cowboy

Statoil is the latest to have seen the error of its ways… more to the point, finally recognising the tide has turned and forcing its hand to switch strategies from oil to renewables.

The Norwegian heavyweight is far from alone. As DONG (Dansk Olie og Naturgas) sanctimoniously said when announcing its re-brand to Orsted and re-focus to renewables, the time had arrived to shift from “black to green energy”.

Statoil’s rebrand to Equinor sees the O&G major eagerly point out that its new identity combines “equi” the starting point of such elegant words as “equal, equality and equilibrium”, and “nor”230; homage to its Norwegian origins. Good lord, what a load of tosh.

This is a seismic shift in the oil industry driven in many cases by investors – in the Nordic cases, pension funds and sovereign wealth – that will no longer touch anything with oil in the name. As such, the zealous conversion of oil barons to renewable energy pioneers is driven by market reality, not a road to Damascus revelation.

French oil major Total last month (April 2018) made the leap with its acquisition of Direct Energie which has a 550MW renewables portfolio and a 2GW pipeline; while Royal Dutch Shell (also last month) ramped up involvement in renewables through its New Energies division, hinting at up to $2 billion of investments per annum up to 2020.

Beyond that, BP signalled its intentions to carve out its niche in the renewables space last year (2017) with its $200 million acquisition of a 43% stake in Lightsource – imaginatively rebranding it to Lightsource BP.

Those with a functioning memory will recall that BP has been here before with its Beyond Petroleum strategy, but promptly divested all its wind power assets in 2013 and withdrew from the sector. Likely it regrets having done that.

And it’s not alone, most of the O&G majors have dipped toes in the renewable water at some stage in the last decade-plus, but it never seems to take long – often a change in chief exec – for them to about-turn and focus once again on “core business”, shaking their heads at the folly of previous leaders straying from the path.

That’s just the tip of the iceberg. The shift away from oil has been dramatic with environmental, social and governance (ESG) issues being at the forefront of investors’ minds these days forcing the hand of “dirty” companies to mend their ways.

It cropped up repeatedly in round tables published in our launch issue of the IJInvestor Funds & Investors Report. In this report, infra fund leaders stressed that ESG had transitioned from lip-service to central focus.

To this end every international oil company (IOC) on the planet that has “oil” in its name has either re-branded or is in discussions right now with branding specialists to reinvent themselves as something less unpalatable to investors.

Nice work for the consultancies – money for old rope – who can flog off-the-hanger brands they own and wrap them around a pretty story that the IOC will convince itself reflects the shift in focus (listening Equinor?).
A green new world

The majority of these oil companies are shifting their focus toward offshore wind, seeking the scale of projects to give them a flying start and to leverage their experience of working in challenging environments.

There’s clear water between where the industry used to be and where it is now. Gone are the days when IOCs dabbled in renewables for this to serve as a fig leaf to their less “responsible” activities.

According to the Global Wind Energy Council, by the early 2020s offshore wind will cost less than €70/MWh (2017 prices) and 120GW installed capacity will be in place by 2030. With €60/MWh just around the corner it becomes ever-more affordable and growing deal flow the IOCs are catching the wave at just the right time.

Furthermore, there will be need for more players with deep pockets in this space to support delivery of ambitious programmes. And ambitious offshore wind programmes are cropping up in every corner of the world.

Just last week (April 2018), Taiwan's Ministry of Economic Affairs awarded grid connection rights for 3.8GW of offshore wind – 336MW more than had been anticipated – with a further 2GW to be allocated in June (possibly more if the first round’s anything to go by).

The winning bidders are:

WPD – 1,058MW
Orsted – 900MW
Copenhagen Infrastructure Partners – 600MW
Swancor Renewables – 378MW
China Steel – 300MW
Taiwan Power – 300MW
Northland Power – 300MW

Sticking with Asia Pacific, Japan has an exciting market where it already has 44.7MW of offshore wind installed. The Japanese Wind Power Association is pushing for 10GW by 2030 with 30-year leases awarded by the Ministry of Economy, Trade and Industry (METI). This target is now being seen as conservative and pressure is being brought to bear for it to be increased considerably.

Both these markets – Taiwan and Japan – face the extra challenges as the projects are largely in deep water, as such floating offshore wind is increasingly mentioned.

A lot bigger and even more ambitious, China plans to develop 30GW of offshore wind by 2020. There’s a lot of discussion over how it will achieve this… but if any nation can do it, China can.

South Korea plans to increase the country's renewable energy capacity by 2030, taking it up from 11.3GW to 58.5GW by end of the decade which will represent 33.7% of the country’s electricity-generating installed capacity, up from a 9.7% share today. Offshore wind will form part of that push.

And again, that’s just the tip of the iceberg.

Australia has huge potential, as does India, Thailand (where there are declining supplies of natural gas) and Bangladesh (with low-speed turbines). For the US, the days of Cape Wind look to be in the rear-view mirror. Europe is moving at break-neck pace.

Any country with a coastline and decent wind resource – especially now that floating solutions are on the table – is turning its gaze that direction.
A view from the sea

Chatting this week with renewables supremo Simon Currie who relocated as global head of energy at Norton Rose Fulbright from London to Sydney in January 2015, he has been taken aback by the pace of change.

“What was a $200 billion market until just recently is now looking more like a $1 trillion market,” says Simon. “All of a sudden it’s offshore wind versus natural gas, versus solar – what do you have and what is the best use of it? At €60/MWh with decent wind with a bit of track record, that’s better than gas.” He adds: “I’m encouraged by the amount of capital that is coming in. It’s no longer five countries!”

And he’s in a good place to take advantage of this market shift, having in March (2018) announced that he and fellow NRF Vincent Dwyer were setting up an advisory business based out of Australia providing services to the energy sector (strategic consulting and guidance, and transaction advisory services).

But it’s so much more than the oil companies. IOC involvement is welcome as the scale of the offshore wind sector will be so vast and heavyweights will be needed at the table, but it runs beyond that.

“For me, the big take-away from COP 23 was that industrials are getting involved too,” says Simon. “We are seeing the major industrials like thyssenkrupp – people who never really paid much attention to renewables – saying their future is not in combustion engines, it’s in hydrogen electrolysers, wind turbines… whatever. They cannot sit there waiting for the Xerox moment.”

With so much to be achieved and growing comfort with offshore wind, it’s going to take companies with scale – ranging from re-branded IOCs through to global industrials – to deliver programmes.

In fact, with all these projects on the cards, everyone’s welcome (fig leaf or not).

[la forge] 04/5/2018 07:50

HSBC new target prices for Shell and BP: they turned out to be good oil price recovery plays
Fri 4 May 2018 05:18:24 GMT
Author: Giles Coghlan | Category: News

Author: Giles Coghlan

HSBC on target prices for Shell and BP


Shell RDSb L: Raises target price to 2665p from 2640p
Shell RDSa L: Cuts target price to 2590p from 2595p
BP PLC BP.L: Raises target price to 600p from 590p


Shell and BP have seen some steady gains alongside the recovery of Oil prices. And once BP has finished with its Deepwater Horizon Bill (65 Billion dollars) it could be well placed for a decent recovery from its previous lows. It was only about 18 months ago when BP was trading at 400p a share. Currently at 543p.

[maywillow] 03/5/2018 17:40

BLOOMBERG
markets
BP Said to Tap Morgan Stanley as It Weighs Buying BHP Assets
By Dinesh Nair
, Brett Foley
, and Kelly Gilblom
3 mai 2018 à 12:23 UTC+2 Updated on 3 mai 2018 à 12:41 UTC+2



BP Plc is weighing an acquisition of some of BHP Billiton Ltd.’s energy assets as the British oil major seeks more U.S. shale, according to people familiar with the matter.

The London-based company is working with Morgan Stanley to advise on the plans, said the people, asking not to be identified as the matter is private. BP is weighing teaming up with other suitors or swapping conventional assets -- where oil and gas typically flow more easily to the surface than shale -- with BHP, they said.

No final decisions have been made and BP could decide against proceeding with a formal bid, the people said. Spokesmen for BP, BHP and Morgan Stanley declined to comment on the sale.

BHP is selling 800,000 net acres in the Eagle Ford, Permian, Haynseville and Fayetteville Basins it has said are worth at least $10 billion. It is preparing to sell those assets in up to seven packages, including three in highly-prized Permian, people familiar with the matter said this month. It’s not clear which of those assets BP wants to buy.

BP held Permian properties until 2010, when it sold a number of such assets to raise cash for expenses tied to its Gulf of Mexico oil spill. It has since considered various options for the area, “but it’s been really hard” in the past three to four years to find deals that add to earnings, Chief Financial Officer Brian Gilvary told Bloomberg News last month. The company is looking at BHP’s Permian assets, he said.

BP is working to regain the trust of shareholders, who are urging it to maintain financial discipline. The largest oil companies overspent during the days when oil was above $100 a barrel, eroding returns when prices dropped. Gilvary said funding a deal in the Permian would be “tough” within BP’s current capital constraints.

Data rooms are open and bids are due by June, the Melbourne, Australia-based mining company said last month. It could announce one or more transactions by the end of December. BHP said it’s also evaluating asset swaps, an initial public offering or potentially spinning off the division.

BHP disclosed plans to sell its onshore U.S. division last summer after activist investor Elliott Management Corp. said its foray into shale had wiped out $40 billion. The company, which spent $20 billion on two U.S. oil and gas acquisitions in 2011, said in November the divestiture process could take two years.

Royal Dutch Shell Plc is also potentially interested in BHP’s Permian basin assets, Andy Brown, its upstream director, said in an interview in February. Explorers can spend as little as $15 a barrel to drill in the Permian, the main source of the current surge in U.S. output.
Shell and Blackstone Group LP are planning a joint $10 billion bid for BHP’s U.S. assets, Sky News reported in March, citing sources it didn’t identify.

Shell already has about 280,000 net acres in the Permian, according to its website, with a sizable position near BHP’s assets in a fast-growing part of the Permian known as the Delaware Basin.

BP, which now lacks a meaningful presence in the Permian, controls 3.1 million net developed acres in other shale fields in Texas, Arkansas, Colorado, and elsewhere in the U.S. that primarily produce gas, according to its annual report.

A measure of its first-quarter profit rose to $2.59 billion, the highest since 2014, the company reported on Tuesday. That surpassed analysts’ forecasts. Its shares this week rose to their highest level since May 2010.

[waldron] 02/5/2018 19:51

Siemens introduces lithium-ion battery for offshore operations
5/2/2018

HOUSTON -- A clean, reliable power supply is critical for offshore oil and gas assets. Siemens is now applying its electrification experience in the marine industry to offshore oil and gas, with a focus on reducing emissions and risk in unforgiving operational environments.

The company’s advanced lithium-ion battery based solution, known as BlueVault, is suited for both all-electric and hybrid energy-storage applications. The energy storage solution is designed to help ensure continuity of power and minimize carbon dioxide emissions, with an end goal of a low-emissions platform. The battery is designed to maximize life, performance and safety.

Since 2013, Siemens has been supplying the marine industry with an innovative diesel-electric propulsion (DEP) system, BlueDrive Plus C, designed to reduce greenhouse gas emissions, fuel consumption and maintenance costs when compared to traditional diesel-electric propulsion systems.

The company has a track record of developing cost- and emission-reducing solutions for marine applications. In 2015, Siemens jointly developed the world’s first electric car ferry, Ampere, with Fjellstrand shipyard and ship-owner, Norled.

Today, the Ampere ferry’s zero-emission propulsion solution has no direct or indirect emissions, because the batteries are recharged using hydro-electric power. The all electric ferry weighs approximately half that of a regular car ferry due to the aluminum hull, and uses only 150 kWh of renewable energy/crossing which eliminates emissions and reduces fuel costs by 60%.

Pursuant to its research and development efforts and experience with harsh offshore operating environments, the company will open a fully robotized and digitalized plant in Norway that will develop and manufacture energy storage technologies for both marine and offshore oil and gas applications. The same battery storage solutions for marine and offshore environments are also applicable to offshore wind farms. In the longer term, Siemens hopes to leverage its expertise to develop a low-emissions offshore platform.

“Energy storage solutions provide a means to establish a stable, reliable electrical network by buffering inter-mittency and providing clean, dispatch-able power,” said Terje Krogh, CEO of Siemens Offshore Solutions. “The Ampere ferry, which is entirely emission-free, serves as an example of how an energy storage system could also be successfully applied in an oil and gas environment.”

Siemens has signed several contracts for its new energy storage system and expects to deliver the first one this summer.


SOURCE WORLDOIL