US, Venezuela reach deal on prisoner swap
The US and Venezuela have agreed on a prisoner swap that includes the release of 10 detained US citizens in exchange for clemency to a high-profile businessman accused of money laundering, senior US administration officials confirmed.
Releasing political prisoners was among US conditions for continuing to pause restrictions on Venezuela's oil industry, along with free and fair presidential elections in 2024, although a senior administration official said that the agreement was not a direct exchange.
"In terms of sanctions relief, I want to underscore ... that at no point have we talked about sanctions relief or oil and gas relief in exchange for wrongfully detained Americans," the official said. "That has never been a part of the discussion."
The US released Colombian businessman Alex Saab, who has returned to Venezuela, based on broadcasts from state-run television stations.
Those released by Venezuela include six that the US considered to be wrongfully detained. Venezuela is releasing 20 Venezuelan political prisoners, as well as Roberto Abdul, who was arrested for allegedly trying to sabotage a vote in Venezuela about attempts to annex part of Guyana. It also suspended arrest warrants for three other Venezuelans in relation to that allegation.
Venezuela is also arresting and returning to the US citizen Leonard Francis, whom the US sought in relation to corruption in contracts with the US Navy.
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Latest shale mega-deal looks outside the Permian
Latest shale mega-deal looks outside the Permian
New York, 3 June (Argus) — The latest blockbuster deal to shake up the shale patch looks beyond the crowded Permian basin, where valuations have soared and merger opportunities have dwindled since the latest round of consolidation began late last year. ConocoPhillips' $17.1bn all-stock takeover of Marathon Oil expands the leading US independent's position in the Eagle Ford of South Texas, North Dakota's Bakken, and the Anadarko basin of Oklahoma, in addition to the Permian. The acquisition reflects a desire by ConocoPhillips to "become a leader of scale across the lower 48 rather than solely in the Permian", consultancy Rystad senior analyst Matthew Bernstein says. The combined company will produce more than 1.4mn b/d of oil equivalent in the lower 48 US states, behind only ExxonMobil and the proposed Chevron-Hess tie-up. It will also take second place when it comes to overall inventory, according to Rystad. ConocoPhillips, which reportedly lost out in the race for previous targets, has long made the case for industry mergers to build scale, although it has cautioned against overpaying. The company sees itself as having been an early consolidator in the Permian, following its $8.6bn acquisition of assets from Shell in 2021, which built on the $9.7bn takeover of Concho Resources the previous year. About 30pc of the total deal value is being paid for Marathon's shale inventory, after accounting for existing production and gas assets in Equatorial Guinea, according to Enverus Intelligence Research. "Combining with Marathon will boost Conoco's market cap to above $150bn, extending its lead as the largest independent producer and placing it broadly in the same scale as majors, above BP and behind Shell," says principal analyst at Enverus, Andrew Dittmar. The transaction hands ConocoPhillips more than 2bn bl of resources with an estimated cost of supply of less than $30/bl. Savings of at least $500mn are pegged in the first year. And plans to buy back more than $20bn of shares in the first three years will more than cover the equity issued as part of the transaction. Operational efficiencies are likely to come from both sides of the deal. ConocoPhillips has been drilling about 50pc faster than Marathon in the Eagle Ford over the past year, and its wells have been 10pc more productive, consultancy Wood Mackenzie estimates. But in the Bakken, Marathon's wells have outperformed. "While neither play will likely become a growth asset for ConocoPhillips, they will be able to provide good cash flow generation," Wood Mackenzie Americas upstream director Ryan Duman says. Overlapping opportunities A potential deal with Marathon only appeared on the company's radar a few weeks ago, according to ConocoPhillips chief executive officer Ryan Lance — "We know the Eagle Ford quite well, the Bakken quite well and saw the significant overlap in the opportunities that this represented." Company executives talked up prospects for "refracking" more existing wells to boost their lifespan and production. And Lance heralded a new era for shale, centred on using new technology and data analytics to boost such efficiencies. "It allows us to extend some tier-one inventory both in the Eagle Ford and the Bakken," he says. A typical refrack costs 60-70pc of a new well. "We're even seeing some of those costs coming in below the 60pc mark, which is very encouraging," ConocoPhillips' executive vice-president for the lower 48, Nick Olds, says. The focus on mature basins such as the Eagle Ford and Bakken could mitigate against much in the way of pushback on anti-trust grounds. However, with the Federal Trade Commission zeroing in on oil deals of late, the transaction could still face intense scrutiny. By Stephen Cunningham Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
South Korea finds up to 14bn bl in oil, gas deposits
South Korea finds up to 14bn bl in oil, gas deposits
Singapore, 3 June (Argus) — South Korean president Yoon Seok-yeol announced today that it is "very likely" there is up to 14bn bl in oil and gas deposits off Yeongil bay in Pohang city. This was verified by "leading research institutes and experts", Yoon added. The 14bn bl is sufficient to meet the country's natural gas consumption for up to 29 years, and oil consumption for up to four years. Yoon said he has approved the trade, industry and energy ministry's exploratory drilling plan for deep-sea oil and gas fields in the east sea, and expects some results to be available by first-half 2025. South Korea relies almost entirely on imports to meet its oil and gas needs, with the US' EIA estimating South Korea's fossil fuel import dependence at almost 98pc. The Middle East was the top source of crude for South Korean refiners in April , accounting for around 75pc of total crude imports at 2.25mn b/d. This is in addition to LNG supplies from Middle East countries accounting for over 30pc of South Korea's imports in April . By Tng Yong Li Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
India cuts 1H June windfall tax on crude output by 9pc
India cuts 1H June windfall tax on crude output by 9pc
Mumbai, 3 June (Argus) — India has reduced its windfall tax on domestic crude production by 9pc from mid-May to 5,200 rupees/t ($8.50/bl) in line with a fall in international prices, marking the third consecutive cut since early May. The new rate took effect on 1 June, according to a government notice. The rate was last revised on 16 May . It is revised every two weeks. Crude prices fell by over 2pc between 16 May and 1 June, leading to the windfall tax cut. There was no change in the excise duty on exports of gasoline, diesel and jet fuel, which remained at zero. The Indian government first imposed the windfall tax in July 2022 because a sharp increase in crude prices then led to domestic crude producers making windfall gains. Indian producers sell crude to domestic refineries at international parity prices. India's crude production fell by 2pc on the year to 535,000 b/d during January-April, according to latest oil ministry data. The country recently sought bids for two discovered small oil and gas fields in the Mumbai offshore region. Bid rounds for discovered small fields were launched in 2016 to boost domestic oil and gas production and reduce India's import dependency. Delhi has also extended a deadline for submitting bids for 28 upstream blocks in the ninth Open Acreage Licensing Programme (OALP) bidding round to 15 July. The OALP was introduced in 2017 to attract oil and gas firms to develop India's upstream sector. By Roshni Devi Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Sheinbaum leads in Mexico election to follow AMLO
Sheinbaum leads in Mexico election to follow AMLO
Mexico City, 3 June (Argus) — Ruling party candidate Claudia Sheinbaum was winning Mexico's presidential election by a wide margin today, according to preliminary results, after a race in which she committed to continue President Andres Manuel Lopez Obrador's state-centric energy policies. Sheinbaum with the Morena party was ahead with 59pc of the vote as of 12am ET on Monday after Sunday's election, according to early results from the national electoral institute (INE), based on less than 7pc of the total votes. She was followed by Xochitl Galvez from a right-left (PRI-PAN-PRD) coalition with 29pc, and Jorge Alvarez Maynez from left-centrist Movimiento Ciudadano with 9pc. The former mayor of Mexico City and climate scientist vowed during the campaign to boost renewable energy , but also to keep state-owned companies at the center of the market. Lopez Obrador, known as AMLO, had started rolling back then-recent openings for private-sector energy investment when he took office in 2018. The Morena party began celebrating Sheinbaum's victory, but the opposition had yet to concede the race as of midnight. Sheinbaum's party and allies are also leading the congressional race, according to preliminary results. Sheinbaum's Morena and allies were ahead with around 55pc of the 500 seats in the lower house, with 35pc for the PRI-PAN-PRD coalition and 10pc for Movimiento Ciudadano. Morena and allies also were winning a majortiy of the 128 seats in the upper house with similar figures, preliminary results from the INE show. More detailed results are expected in the coming days, once more than 50pc of the votes are counted. With Sheinbaum at the forefront of polls for months, the Morena party focused on securing majorities in both houses of congress. But the incumbent party could fall short of the 66.67pc of both houses needed to implement broad constitutional reforms. Instead, Sheinbaum is expected to continue with Lopez Obrador's energy sovereignty policies and strengthening oil company Pemex and power utility CFE through financial support rather than eliminating the 2014 energy reform from the constitution. Sheinbaum — who will become Mexico's first female president and the first in North America — has vowed to continue supporting Pemex and CFE, limiting private-sector investment despite the companies' limited financial capacities. She has indicated during the campaign that there will still be no auctions of areas for oil exploration after the Lopez Obrador government halted these. In downstream, Sheinbaum has expressed support for major Pemex's refining projects such as two under-construction cokers and the start-up of the long-delayed 340,000 b/d Olmeca refinery, in line with Lopez Obrador's goal to cut fuel imports. Mexico's government poured around $4bn into maintenance alone at Pemex's aging refineries during the Lopez Obrador administration, in addition to $6bn-$8bn for the uncompleted cokers and a spiraling $16bn-$20bn for the Olmeca refinery. Pemex's refining system increased its crude processing by 53pc to 975,500 b/d in January-April, up from 639,000 b/d in the same period of 2018 prior to the start of Lopez Obrador's administration. Mexico also held governor elections in nine states, including Mexico City, but the preliminary results were not yet available. The country experienced its largest election with nearly 20,000 posts up for election, but also its most violent in modern times with 30 candidates killed. The next president will take office on 1 October for six years and the new congress will be sworn in on 1 August. By Antonio Gozain Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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