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Shell sees potential for LNG supply shortage in mid 2020s
Our Bureau

Shell sees potential for a supply shortage developing in mid-2020s, unless new LNG production project commitments are made soon.
It says supply mismatch must be resolved to enable project developers to make final investment decisions

New Delhi, Feb 27

The growth in demand for liquefied natural gas (LNG) can lead to a global shortage if corrective measures are not undertaken, according to Shell’s annual LNG Outlook 2018.

The report said: “The global LNG market has continued to defy expectations of many market observers, with demand growing by 29 million tonnes to 293 mt in 2017.”

“Shell sees potential for a supply shortage developing in mid-2020s, unless new LNG production project commitments are made soon,” the report added.

Maarten Wetselaar, Integrated Gas and New Energies Director at Shell, said: “We are still seeing significant demand from traditional importers in Asia and Europe, but we are also seeing LNG provide flexible, reliable and cleaner energy supply for other countries around the world.”

Things are far worse for India and China’s air quality by 2035, going by Shell’s expectations . According to the report, there is an incremental energy demand of more than 600 thousand tonne of oil equivalent expected in both countries from 2017-2035. Due to high dependence on coal, for more than 75 per cent of the total incremental demand, the air quality index reports extremely poor conditions for the two countries.

According to Shell, LNG buyers continue to sign shorter and smaller contracts. In 2017, the number of LNG spot cargoes sold reached 1,100 for the first time, equivalent to three cargoes delivered every day. This growth mostly came from new supply from Australia and the USA.

This has led to the mismatch in requirements between buyers and suppliers growing. Most suppliers still seek long-term LNG sales to secure financing. But LNG buyers increasingly want shorter, smaller and more flexible contracts so they can better compete in their own downstream power and gas markets, the report said.

Shell said, “This mismatch needs to be resolved to enable LNG project developers to make final investment decisions that are needed to ensure there is enough future supply of this cleaner-burning fuel for the world economy.”

Japan remained the world’s largest LNG importer in 2017, while China moved into the second place as Chinese imports surged past South Korea’s. Total demand for LNG in China reached 38 million tonnes, a result of continued economic growth and policies to reduce local air pollution through coal-to-gas switching, the report added.
Published on February 27, 2018

[waldron] 23/2/2018 17:05

Shell A
2,258.5 -0.24%


Shell B
2,285 -0.28%

[sarkasm] 23/2/2018 13:21

will it slip out of the 2250 to 2350 BOX

[sarkasm] 23/2/2018 13:19

Shell A
2,251 -0.57%

[sarkasm] 23/2/2018 11:06

Shell A
2,250 -0.62%

[fenners66] 23/2/2018 10:51

may be tempted for some more soon.

[waldron] 22/2/2018 17:09

Shell A
2,264 +0.27%



Shell B
2,291.5 +0.35%

[the grumpy old men] 22/2/2018 11:48

Energy majors commit to reducing methane emissions

Article by Helen Tunnicliffe

EIGHT global energy majors have committed to reducing methane emissions from their natural gas assets and to encouraging others to do the same.

The CEOs of BP, Eni, ExxonMobil, Repsol, Shell, Statoil, Total and Wintershall met to sign the Guiding Principles document on 22 November. Methane is a potent greenhouse gas and if natural gas is to fulfil its role in meeting energy demand while the world transitions to a low-carbon energy market, methane emissions from the production value chain must be reduced.

The Guiding Principles document was developed in collaboration with eight environmental organisations – the Environmental Defense Fund, the International Energy Agency (IEA), the International Gas Union, the Oil and Gas Climate Initiative Climate Investments, the Rocky Mountain Institute, the Sustainable Gas Institute, the Energy and Resources Institute, and United Nations Environment Programme.

There are five main principles. The first is to continually reduce methane emissions, including monitoring emissions and prioritising work at the higher-emitting facilities. The signatories agree to reduce venting and fugitive emissions, and to develop and support, both operationally and financially, new emissions technologies.

The second principle is to advance strong performance across gas value chains. The eight companies involved will engage with upstream midstream and downstream participants to study methane emissions and work with industry partnerships and trade associations to improve methane emission management.

The companies will also improve the accuracy of methane emissions data, advocate sound policy and regulations, and increase transparency in emissions data reporting.

“The commitment by companies to the Guiding Principles is a very important step; we look forward to seeing the results of their implementation and wider application. The opportunity is considerable – implementing all of the cost-effective methane abatement measures worldwide would have the same effect on long-term climate change as closing all existing coal-fired power plants in China,” said Tim Gould, head of supply division, World Energy Outlook, IEA.

Article by Helen Tunnicliffe

Senior reporter, The Chemical Engineer

[waldron] 20/2/2018 17:48

Photographer: Simon Dawson/Bloomberg
Shell Shows Interest in BHP Assets
By Angelina Rascouet
20 février 2018 à 18:04 UTC+1

Oil major has acreage in Permian that overlaps BHP’s acreage
Miner plans to evaluate bids for U.S. assets in Sept. quarter

Royal Dutch Shell Plc said it’s potentially interested in BHP Billiton Ltd.’s oil assets on sale in the Permian basin in the U.S. as it seeks to boost its role in shale.

The Anglo-Dutch company entered the prolific oil region in 2012 and plans to expand its position and generate positive cash flow next year, Andy Brown, Shell’s upstream director, said in an interview on Tuesday. The Permian offers production costs as low as $15 a barrel and is the driving force behind the current surge in U.S. output.

Shell “will look at opportunities to bulk up our shale position,” Brown said at the International Petroleum Week conference in London. BHP has good assets that “overlap our own acreage in the Permian,” and “may be interesting for us.” He didn’t say if the companies are currently talking.

BHP is accelerating plans to exit its $10 billion U.S. shale unit and said deals could be announced before the end of the year. BHP is prepared to offer the assets in as many as seven packages, including three in the prized Permian Basin, people with knowledge of the producer’s plans said this month. It expects initial bids for assets including the Fayetteville field in the June quarter, according to a statement Tuesday.

“We do see the potential there, we do see us performing very well there,” Brown said about the Permian. Shell is currently spending more on deep-water projects, but the company will look “over time to push a bit harder on that shale business.”

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[waldron] 20/2/2018 10:39

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[maywillow] 18/2/2018 08:59

3 things not to do when the FTSE 100 is falling

Edward Sheldon | Sunday, 18th February, 2018
Image source: Getty Images.

When global stock markets are falling, there’s no doubt investing can be a little scary. No one likes seeing their hard-earned capital shrink. This is especially true if you’re new to investing and haven’t experienced these kinds of conditions before.

However, what you do when markets are volatile can have an enormous influence on your overall success as an investor. Play your cards right and you could actually profit from stock market volatility over the long term. Play your cards wrong and it could be severely detrimental to your net worth.

With that in mind, here’s a look at three things not to do when the FTSE 100 is falling.
Don’t panic

If the market is plunging, don’t panic. It’s important that you remain calm. If you’re calm, you’re much more likely to make rational long-term decisions. If you’re panicked, you may end up doing something you’ll regret later on.

I’ve found that one of the keys to staying in control is to understand what’s going on. Find out why the markets are falling. If you understand why stocks are declining, it can be a little less scary.

Second, put any falls in perspective. Recently, the Dow Jones experienced its single largest one-day fall ever. The index was down 1,597 points at one stage of the day – a 6.3% decline. Looking at that figure in isolation, you could be forgiven for being concerned.

However, when you consider that over the last two years, the Dow had risen around 65%, that drop doesn’t look so bad. Global markets had a great run, so it was only natural that a correction would occur at some point in time. Unfortunately, the simple fact is that stocks often fall a lot faster than they rise.
Don’t obsess over profit/loss

Next, when markets are falling, don’t obsessively check your portfolio’s value. Constantly checking your profit/loss will drive you insane. It’s not healthy for your mindset.

Instead, get away from your screen and find something to do that will take your mind off the markets. Walk the dog or hit the gym. This will help you relax and put you in a better frame of mind to make rational long-term investment decisions.
Don’t sell

Lastly, don’t sell your stocks just because the market is falling. Don’t stress if some of your holdings are showing a loss. Stocks rise and fall, sometimes quite dramatically.

For example, I bought shares in Royal Dutch Shell a few years back at around 1,900p. A short time later, the stock was trading at 1,300p as global markets and the oil price nosedived. I could have sold up and locked in a loss. Instead, I held on. That was a wise move in hindsight. Just recently, the shares were trading as high as 2,600p, meaning that I was sitting on a healthy profit.

Stock market volatility is part of investing. Even high-quality FTSE 100 stocks can experience wild swings in price at times. The key is to hold your nerve and remember that investing is a long-term game.
For higher returns, avoid these classic investing mistakes

With global markets down sharply, now could be a good time to read our report The Worst Mistakes Investors Make.

The report lists all the classic mistakes that novice investors make, and could help you become a better investor.

Better still, it's FREE, and can be downloaded within seconds, simply by clicking here.

Edward Sheldon owns shares in Royal Dutch Shell. The Motley Fool UK has recommended Royal Dutch Shell B. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

[sarkasm] 14/2/2018 08:54

Billion-Dollar Bribery Scandal Sweeps Through Oil Industry -- WSJ
14/02/2018 8:02am
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Criminal case alleges corruption in Shell and Eni deal for Nigerian field

By Sarah Kent in Abuja, Nigeria, and Eric Sylvers in Milan

This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (February 14, 2018).

A top oil executive walked into the marble lobby of an exclusive Milan hotel on a chilly winter night. His dinner date was a former Nigerian oil minister offering to sell one of Africa's biggest untapped oil discoveries.

Eight years later, the question of whether the $1.3 billion paid for the license to that prized oil field was mostly a bribe is at the heart of one of the biggest bribery scandals the oil industry has ever seen.

Part of a broader crackdown, the case has reached into the highest levels of the executive ranks of Royal Dutch Shell PLC, the second-largest Western oil company -- including wiretaps on its chief executive -- and into Eni SpA, Italy's state-backed oil company.

Italian prosecutors say Claudio Descalzi, the senior Eni executive at the Milan dinner, and high-level Shell officials approved an arrangement that allowed them to pay the government while knowing most of the money would be transferred to a company controlled by Dan Etete -- the ex-oil minister Mr. Descalzi met that night, according to court documents. The prosecutors say executives knew Mr. Etete would pay off Nigerian officials and send kickbacks to Eni executives. A criminal trial begins in Milan on March 5.

The scheme went as high as former Nigerian President Goodluck Jonathan, who received payouts during his presidency, the prosecutors say. Mr. Jonathan has denied involvement.

The case is a rare example of top executives from giant Western oil companies facing accountability for corruption. Scrutiny of foreign bribery is growing. More than 500 ongoing investigations were taking place in member countries of the Organization for Economic Cooperation and Development in 2016, up about 25% from 2015, according to the 35-nation group's latest analysis.

British authorities are investigating alleged oil-industry bribes in Iraq, and the U.S. has sought to recover more than $100 million as part of a wide-ranging investigation into oil-industry corruption in Nigeria.

The amount of money that allegedly changed hands in the Eni-Shell case could prove to be one of the oil industry's largest ever bribes, said Global Witness, a London nonprofit that investigates allegations of wrongdoing in the resources industry.

Mr. Descalzi, now Eni's chief executive, will face criminal charges of international corruption and bribery in the Milan trial, along with the company's CEO at the time of the Nigerian deal, Paolo Scaroni. Shell executives, including Malcolm Brinded, Shell's global exploration and production chief at the time of the deal, will also be tried on those charges, as well as both companies.

Eni and Shell both deny wrongdoing, saying they simply paid the government and didn't know the money would be used for bribes.

"Eni and Shell paid the consideration for this license to the Nigerian government," Eni wrote in emailed responses to questions from The Wall Street Journal. "It was the prerogative, right and at the discretion of the Nigerian government to decide...how to use the price received from Eni and Shell."

"The board has said clearly that it has full confidence in the company and in Claudio Descalzi," Eni Chairwoman Emma Marcegaglia said in an interview.

A Shell spokesman said the company didn't believe there was a basis to prosecute Shell. "If the evidence ultimately proves that improper payments were made...it is Shell's position that none of those payments were made with its knowledge, authorization or on its behalf," he said.

Eni's Mr. Descalzi, who was appointed by the Italian government for a second three-year term as CEO in April, Mr. Scaroni, who left Eni in 2014, and Shell's Mr. Brinded, who left the company in 2012, denied wrongdoing.

Shell and Eni also face prosecution in Nigeria, one of Africa's biggest oil producers. The country's financial crimes watchdog has threatened to strip the companies of their claim to the oil field.

Shell and Eni in 2011 jointly acquired the license to the area known as OPL 245 in the waters off Nigeria's coast, but so far development has been stalled amid the investigations.

This account of the deal is based on interviews with more than a dozen people with knowledge of the case, internal company emails and documents, and hundreds of pages of court documents from cases in Britain, Italy and Nigeria reviewed by the Journal.

The deal pulled in top executives for Shell and Eni, who were required to approve and in some cases negotiate the transaction, bringing them into contact with a host of now discredited figures in Nigeria.

Chief among them is Mr. Etete, a Nigerian politician who was an oil minister in the mid-1990s during the reign of military dictator Sani Abacha, and who personally claimed ownership of OPL 245. Mr. Etete's career has been dogged by corruption allegations. In 2007 he was convicted of money laundering in France and was pardoned in 2014. A lawyer for Mr. Etete, whose whereabouts is unknown, didn't respond to requests for comment. He faces corruption charges in both Milan and Nigeria.

"It smacks of a Hollywood movie," said Razak Atunwa, a Nigerian member of parliament investigating the case for the government. "You've got nefarious characters mixing with ministers, nefarious characters mixing with the presidency."

The struggle over OPL 245 dates back to 1998, when the Abacha government awarded the oil rights to a newly minted Nigerian firm called Malabu Oil and Gas. According to court documents, the company was ultimately owned by figures close to Mr. Abacha's regime, including his son and Mr. Etete, then the country's oil minister.

The company was meant to pay the government $20 million for the license, but paid only a little over $2 million, according to the court documents.

In 2001, Shell agreed to acquire a 40% interest from Malabu in the oil field. Shell, already a dominant producer in Nigeria, hoped the move would expand its footprint in the oil-rich waters off the coast. But within months, Malabu's ownership was revoked by the new, democratically elected president, Olusegun Obasanjo.

Shell won a new tender in 2002 that gave it exclusive rights to operate the field as a contractor for the state oil company, pledging to pay the government $210 million. But Mr. Etete, who was no longer in office, and later Mr. Abacha's son separately maintained their claims to the site. Successive Nigerian governments flip-flopped on the decision to rescind Malabu's license, helping tie up the ownership question in court.

In an attempt to resolve the dispute, Shell executives spent years alternately wooing Mr. Etete and threatening him with legal action. They negotiated over lunches accompanied by Champagne and discussed taking him on a stag hunting trip to Scotland, according to internal company emails reviewed by the Journal.

In the emails -- some with the subject line "Loony Tunes" -- Shell executives openly speculated that any settlement they reached with Mr. Etete would be used to pay off his political sponsors and fretted over the risk he might seek to strike a deal with another company.

In early 2009, John Copleston, a former British intelligence officer working for Shell in Nigeria, sent an email to colleagues that reported Mr. Etete was claiming he would keep $40 million of the $300 million Shell was offering at the time. "Rest goes in paying people off," Mr. Copleston wrote. Mr. Copleston couldn't be reached for comment.

Eni became involved in 2010. After discussions with Mr. Etete, the Italian firm, which already had major oil holdings in Nigeria, proposed to buy out Malabu's disputed stake. The company aimed to end Malabu's legal claims and join Shell in a 50-50 partnership to develop the offshore field.

Shell executives were pleased. According to internal emails, they were impressed by Mr. Descalzi's personal, "privileged" relationship with Mr. Jonathan, who was serving as acting president and would soon fully succeed the Nigerian president at the time. According to the emails, the two men met in southern Nigeria in the 1990s and had stayed close.

"Let's hope Eni can succeed where we have struggled to close on this," Shell's then-chief financial officer, Simon Henry, wrote in an email in October 2010.

Beginning that year, Mr. Descalzi for a period met twice a month with a middleman who claimed to be working on behalf of Mr. Etete, sometimes at a luxury hotel in London's Belgravia neighborhood, according to court documents. The Eni executive, a 36-year veteran and longtime Africa hand who led Eni's operations in Congo and in Nigeria, also oversaw months of talks with the Nigerian government and with Shell, according to internal Shell emails.

Meanwhile, two external risk reports commissioned by Eni in 2007 and 2010 had raised red flags about Mr. Etete. The documents, reviewed by the Journal, warned of past corruption allegations against the former oil minister and questioned aspects of his ownership of the oil license.

Pressure was mounting to settle the deal. Shell feared other companies such as Total SA of France and China's Cnooc were also negotiating with Mr. Etete. Cnooc didn't respond to requests for comment. Total declined to comment.

"We need to move fast as the wolves are indeed circling," wrote Mr. Brinded, the global exploration and production chief, in an October 2010 email to colleagues.

Eni and Shell soon hammered out a complicated deal with the Nigerian government, according to emails and court documents. In a deal that included Shell's previous promise to pay around $210 million, the company agreed to pay a total of just under $320 million for a 50% stake. Eni would pay a little more than $980 million for the other 50%.

The deal was made on the basis that $200 million would be kept by the Nigerian government and that $1.1 billion would be passed on to Malabu in exchange for its dropping all claims to the oil field, court documents say.

The two sides completed the deal in April 2011, but within months, it began to unravel. Initial efforts to transfer the $1.1 billion from a Nigerian government bank account at JPMorgan Chase & Co. in London to an account in Switzerland was blocked by bank authorities for reasons of "compliance," marking an early red flag. A second attempt to transfer money to a bank in Lebanon was also blocked. The transfer was eventually completed to two Malabu accounts in Nigeria, according to nonpublic Italian court documents.

In the U.S., the Federal Bureau of Investigation traced the flow of dollars from the deal, millions of which made it to the U.S., court documents show. Mr. Etete splashed out nearly $57 million to buy a private jet in Oklahoma in 2011 and another $670,000 for three armored cars in the U.S., according to court documents. He even was able to pay off $7.4 million in fines for the money-laundering conviction in France.

The FBI turned over much of its evidence to authorities in Italy, where Fabio De Pasquale, a high-profile prosecutor in Milan, had begun probing the deal in 2014. Mr. De Pasquale had made a name for himself in the 1990s as a dogged investigator willing to take on powerful forces in Italy, including former Italian Prime Minister Silvio Berlusconi. He presided over separate corruption investigations against Eni that have forced it to overhaul its compliance practices and restructure its former oil services subsidiary.

Italian investigators turned up the heat on executives who might provide useful evidence. One was Vincenzo Armanna, a senior executive in Eni's sub-Saharan Africa business at the time of the deal. Prosecutors allege he received a kickback of more than $1 million when the deal closed, according to Italian court documents.

Mr. Armanna acknowledged he discussed the final destination of Eni's money with his bosses. "We were aware that most of it would go to the political sponsors of the deal," he told prosecutors in 2014, according to the court documents. Mr. Armanna didn't respond to requests for comment.

Another Eni executive received a delivery of $50 million in cash to his house in Abuja, according to Italian prosecutors. By that time, the Italian investigation was zeroing in on the top levels of Eni's management.

"It's believed that Scaroni and Descalzi organized and managed the illegal activities," Milan prosecutors wrote in a 2014 document saying they had put the two under investigation.

In 2016, Shell's offices in The Hague were raided by Dutch police, who spent hours combing top executives' rooms for information on the deal. A cache of internal emails widely leaked to the media revealed details about the company's yearslong negotiation for the oil field.

Dutch investigators also tapped the phone of the company's current CEO, Ben van Beurden, even though he wasn't running the company when the Nigeria deal was struck and faces no charges.

"There was apparently some loose chatter between people from the team," said Mr. Van Beurden on a wiretapped call to his chief financial officer at the time of the raid. He said on the call that discussions of the deal included comments such as, "I wonder who gets a payoff here."

Mr. Van Beurden declined to comment. A Shell spokesman said the company was cooperating fully with regulatory authorities.

The executive was on vacation in France with his children when police were rummaging through his office. "I don't think they have found anything that was clearly incriminating or that sort of suggested that we were colluding or doing anything inappropriate," he said on the tapped call. But referring to the chatter, he said, "Nevertheless, it's there."

--Gbenga Akingbule and Aruna Viswanatha contributed to this article.

Write to Sarah Kent at [e-mail] and Eric Sylvers at [e-mail]



(END) Dow Jones Newswires

February 14, 2018 02:47 ET (07:47 GMT)

[florenceorbis] 11/2/2018 21:46

Oil Majors Optimistic Despite Price Plunge
By Tsvetana Paraskova - Feb 11, 2018, 2:00 PM CST Offshore rig

The earnings season for the oil majors is over. Judging from their results, so is the three-year downturn that has transformed the industry after companies slashed spending and jobs and downsized growth plans.

The supermajors — who reported Q4 and 2017 figures in the past week — are now making nearly as much profits as they did in Q3 2014, when oil prices were just above $100 a barrel.

Higher oil prices in Q4 2017 helped the largest oil companies to double and triple profits, end the scrip dividend programs, and some of them — raise dividends and signal resumption of share buybacks to finally reward shareholders (even more).

The price of Brent plunged by more than $5 in the past week amid a selloff in global markets and a surge in U.S. oil production that rekindled concerns that the oversupply will persist despite some investment banks predicting that the oil market is likely already balanced.

Still, Brent topped $60 a barrel in October 2017 and has not fallen back below that threshold since then, helping the oil supermajors to book much stronger Q4 profits compared to year-ago levels.

While the U.S. supermajors ExxonMobil and Chevron disappointed with earnings misses, Europe’s Big Oil fared better, with BP saying it wrapped up its “strongest year in recent history”, Shell toppling Exxon as the largest cashflow generator in the industry, and Statoil and Total planning to raise dividends.

Cash flows also increased with higher oil prices, signaling that oil majors are now largely capable of covering their investments and dividends without having to pile up more debt loads.

Now that they finally generate more cash — for the first time in three years — oil majors may face other, not as gloomy as before, dilemmas: how to spend that cash.

According to Andy Critchlow, head of energy news EMEA at S&P Global Platts, oil majors now have three obvious options—to boost near-term shareholder returns by higher and/or all-cash dividends and share buybacks; ditch discipline and study a risky acquisition of a rival; or invest more in new upstream projects to secure longer-term growth and shareholder returns.

“Despite lingering concerns over the sustainability of recovering prices, the third course of action could be the best option for both energy markets and shareholders in the long term,” Critchlow argues, citing BP as an example. Shareholders will eventually demand more growth to see greater returns, so it would make sense for the UK supermajor to re-invest more cash into new large-scale projects, according to Critchlow.
Related: LNG: Glut Today, Shortage Tomorrow

This year, BP, for example, is set to start up five major upstream projects in which it is a shareholder, after it launched seven others in 2017.

Still, Big Oil’s top executives are level-headed as far as spending in the near term is concerned, and are assuming quite conservative oil price scenarios for their planning this year, in stark contrast with the big investment banks that significantly lifted their oil price forecasts just days before the financial and energy market carnage this week.

While Goldman Sachs and JPMorgan see oil prices reaching the high $70s and even topping $80 as early as in mid-2018, BP’s CEO Bob Dudley told CNBC “We’re not planning on $70 a barrel. We’re going to plan our year on $55 to $60, roughly, and if is higher we’ll more than deliver on our promises.”

This week, Statoil proposed lifting dividends, but it doesn’t expect oil prices to be above $70.

Total now plans a 10-percent dividend increase and up to $5 billion share buybacks over the next three years, but CEO Patrick Pouyanné said that the oil market is not balanced yet. Total expects oil prices at $50-$60 a barrel this year, but he manages the company as if the price of oil were at $50, Pouyanné said this week, signaling that rigid spending discipline and conservative assumptions still dominate plans.
Related: Venezuela Is Moving From Crisis To Collapse

It looks like Big Oil is now focused on the first of the three options that S&P Global Platts’ Critchlow outlined — rewarding shareholders with all-cash dividends, in some cases higher dividends, and share buybacks to offset the dilution from the scrip dividend plans under which investors could choose to be paid in shares instead of in cash.

In terms of spending on new upstream projects, there are signs that the slump will level off this year. Oil majors will continue “to cherry-pick opportunities, building on the great progress already made in repositioning portfolios for lower prices,” Wood Mackenzie said in its 2018 upstream outlook.

In order to win investors again after dismal stock market performance over the past year, the oil industry needs a pipeline of new projects capable of successfully delivering at oil prices at $50; free cash flow that can grow at $50 oil; and companies start building “compelling cases for long-term investment,” according to WoodMac.

By Tsvetana Paraskova for Oilprice.com

[ariane] 10/2/2018 09:31

Photographer: Chris Ratcliffe
Shell Commits to Expanding Gas Stations as Some Rivals Retreat
By Kevin Orland
8 février 2018 à 22:03 UTC+1 Updated on 9 février 2018 à 06:01 UTC+1

Oil giant expects to expand in Canada by 50 stations a year
Business is adapting to changing transportation landscape

While many oil producers are stepping back from their retail operations, Royal Dutch Shell Plc is doubling down.

Shell, which has about 44,000 filling stations around the world, opened its first one in Mexico last year, the start of $1 billion in investments over the next decade. Shell also is ramping up spending in China, India, Indonesia and Russia, Istvan Kapitany, head of Shell’s global retail business, said in an interview in Calgary.

Istvan Kapitany
Photographer: Colin Whyman via Shell

Even Canada, where other companies have recently sold their retail operations, will see increasing investments. Shell added 50 gas stations in the country last year, bringing its total to about 1,300, and plans to build another 50 this year while also rolling out new features to capture more of drivers’ retail dollars and building up its business for commercial customers, he said.

“We have very, very ambitious growth plans, and Canada is part of that,” Kapitany said in an interview in Calgary.

Meanwhile, others have been leaving. Chevron Corp. last year sold its gas stations and a refinery in British Columbia for about $1.1 billion. Imperial Oil Ltd., majority owned by Exxon Mobil Corp., sold almost 500 company-owned stations to a group of five fuel distributors for $2.1 billion in 2016.
U.S. Market

In the U.S., Sunoco LP sold its gas stations last year, following in the footsteps of ConocoPhillips, Hess Corp. and Valero Energy Corp. While people associate energy producers like Exxon and Chevron with the stations that bear their names, most of those are franchises in the U.S. and oil majors only own a small fraction of them.

Among other producers holding on to their retail businesses are Marathon Petroleum Corp., which rejected a push from billionaire Paul Singer’s Elliott Management Corp. to spin it off, and BP Plc, which like Shell is expanding its presence in retail.

A key to Shell’s strategy is tailoring the stations to regional preferences. For example, in Canada, the Hague-based company is planning to announce a program to increase its healthy food offerings in the coming weeks. In Mexico, Shell touts its guarantee that customers are actually getting all the fuel they paid for, an important promise in a market where fraud at the pump is a problem.
‘Local Culture’

“Local customer demands have to be satisfied by a strong local team that understands the local culture,” Kapitany said. “In this business, there are no global customers. The customer is always local.”

Having robust refining and retail operations, also known as downstream businesses in industry parlance, has been particularly beneficial in Canada recently. That’s because a lack of pipeline capacity has weighed on Canadian oil prices, hurting companies who produce crude but benefiting those that can benefit from the cheaper feedstock.

For Shell, the retail business also is an important means for helping the company adapt to a changing energy world. Shell is building networks of electric-car charging stations in multiple locations while also rolling out locations for fuel-cell and natural gas-powered vehicles. Electric mobility will expand over the coming decades, and Shell needs to play a part in that transition to keep serving its customers, Kapitany said.

“This is what we have been doing for 100 years, and this is most likely what we’re going to be doing for the next 100 years,” he said.

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[ariane] 09/2/2018 14:35

9/02/2018 | 12:55

Paris (awp / afp) - The big oil and gas companies made billions of profits last year thanks to the rise in prices, but they remain cautious and do not want to spend sparingly.

The season of annual results confirmed the good health found in the sector. Total announced this week an annual net profit up 39% to $ 8.6 billion. Its competitors BP, Chevron, ExxonMobil or Royal Dutch Shell have also accumulated profits.

"2017 was one of the best years in BP's recent history," said Bob Dudley, general manager of the British group.

All benefited from the recovery in oil prices, supported by the efforts of the Organization of the Petroleum Exporting Countries (OPEC) and its partners, including Russia, which limited their production to reduce supply in the market.

Last year, oil prices were $ 54 per barrel on average, up from $ 44 in 2016. Brent North Sea crude is now trading at $ 70 a barrel.

The majors took the opportunity to spoil their shareholders, impatient after several years of lean cows, in the form of higher dividends and / or share buyback programs.

But this is not the return of the good years. Following the fall of the courts three and a half years ago, the majors had cut their costs and reduced their investments. After adjusting to be profitable with lower prices, they do not intend to release the bridle.

Shell boss Ben van Beurden summed up his mood last year, saying he was now working as if oil prices were to remain "lower forever".

"HESITATIONS AND UNCERTAINTIES"

"We maintain all these savings programs despite the rise in crude prices," confirmed this week the CEO of Total, Patrick Pouyanné.

Sign of prudence, the improvement of the economic situation is only reflected by a timid recovery of investments in exploration-production.

They had slightly rebounded 4% to 389 billion dollars worldwide last year and should still modestly increase by 2 to 6% this year, said IFP Energies nouvelles, in forecasts unveiled this week. A level that remains far from the $ 683 billion in 2014.

This increase, which is very uneven across regions, is also largely driven by North America and the independent companies that produce unconventional hydrocarbons. The majors, for their part, have seen their expenses fall by 16%.

"The leaders of the big oil companies have certainly breathed a sigh of relief because the rise in prices has yielded significant results," said David Elmes, energy specialist at Warwick Business School.

"But there are also hesitations and long-term uncertainties that limit any return to full-speed development," he says.

Companies remain cautious because the course of prices remains more uncertain than ever. Demand is expected to remain strong, particularly in China and India, but the rebalancing of the market is threatened by a possible opportunistic influx of American shale oil.

"I'm sure that the American independent companies will again invest a lot to benefit from a $ 60 barrel and produce more shale oil, so we will have volatility in the market," predicts Patrick Pouyanné.

[maywillow] 07/2/2018 14:41

Repsol (REP.MC) has signed an agreement with Morocco's National Bureau of Hydrocarbons and Mines, known as ONHYM, and Royal Dutch Shell PLC (RDSB.LN) to explore the country's onshore Tanfit area, the Moroccan state-owned company said Wednesday.

Under the petroleum agreement the companies will explore 9,990 square kilometers of the Tanfit area for hydrocarbon potential.

Spanish oil-and-gas company Repsol will be the operator of the project, ONHYM said.



Write to Euan Conley at [e-mail]



(END) Dow Jones Newswires

February 07, 2018 08:34 ET (13:34 GMT)

[maywillow] 07/2/2018 14:41

Repsol (REP.MC) has signed an agreement with Morocco's National Bureau of Hydrocarbons and Mines, known as ONHYM, and Royal Dutch Shell PLC (RDSB.LN) to explore the country's onshore Tanfit area, the Moroccan state-owned company said Wednesday.

Under the petroleum agreement the companies will explore 9,990 square kilometers of the Tanfit area for hydrocarbon potential.

Spanish oil-and-gas company Repsol will be the operator of the project, ONHYM said.



Write to Euan Conley at [e-mail]



(END) Dow Jones Newswires

February 07, 2018 08:34 ET (13:34 GMT)

[ariane] 04/2/2018 08:25

Shell faces struggle over €3bn Eneco deal


Shell’s step into Europe’s electricity sector has struck a stumbling block

Jillian Ambrose, Energy Editor

3 February 2018 • 8:00pm

Royal Dutch Shell has struck a stumbling block in its march into the European power sector over plans to pluck a Dutch utility from public ownership.

The Anglo-Dutch oil major is a front-runner in the €3bn (£2.64bn) race to snap up Eneco from the hands of 53 Dutch municipalities after the decision to privatise the green energy company.

The group already partners with Eneco on wind power projects in Europe, which could pave the way for its next step into the power market after buying UK energy supplier First Utility for a rumoured £200m.



But The Sunday Telegraph understands that Shell is facing internal divisions over the deal and mounting political opposition.

“The process has been stumbling on for a while but it’s like herding cats with all the stakeholders,” said one City source with knowledge of the deal.



Eneco’s shareholders have been forced to bring in a mediator to prevent the sale from descending into chaos as municipalities clash on whether to sell their stakes in the utility, and how to safeguard its green credentials.

Others rumoured to be in line for the sale include Finland’s Fortum, French energy giant Engie and private equity investor CVC. Shell declined to comment.