Manup Industry Roundup - W2223: NEWSL -02
Good morning!
When the development of the Egina field in deep offshore Nigeria commenced in 2013 it was tagged as the Nigerian adventure of an ultradeep offshore project
The Gaint EGINA holds massive feat not just for the Nigerian oil and gas sector, but for Africa as well - Recall the Egina FPSO holds the record for the largest FPSO by capacity.
Is the Egina adventure ending?
Below are the oil and gas stories and news that made headlines this week carefully curated by Manup.
Oil & Gas Updates
Renewable Energy Watch
Will OECD or OPEC Produce More Petroleum in 2023?
Who will produce more petroleum and other liquids this year? Organization for Economic Cooperation and Development (OECD) countries or OPEC?
It’s a close call, but OECD countries just edge it, according to the U.S. Energy Information Administration’s (EIA) latest short term energy outlook (STEO), which was released earlier this month. The EIA’s May STEO sees OECD petroleum and other liquids production coming in at 33.82 million barrels per day in 2023, compared to OPEC’s 33.76 million barrels per day.
Broken down quarterly, the latest STEO projects that OECD output will average 33.71 million barrels per day in the second quarter, 33.84 million barrels per day in the third quarter, and 34.38 million barrels per day in the fourth quarter.
OPEC production, on the other hand, is anticipated to hit 33.75 million barrels per day in the second quarter, 33.77 million barrels per day in the third quarter, and 33.58 million barrels per day in the fourth quarter.
The U.S. is projected to take the largest slice of OECD production in 2023, at 21.12 million barrels per day. Output from the country will average 21.15 million barrels per day in the second quarter, 21.11 million barrels per day in the third quarter, and 21.27 million barrels per day in the fourth quarter, according to the STEO.
Last year, OPEC supply came in at 34.17 million barrels per day, while OECD output averaged 32.26 million barrels per day, the EIA’s latest STEO highlighted. Total world supply is expected to come in at 101.34 million barrels per day in 2023, compared to 99.85 million barrels per day in 2022, the May STEO revealed.
In its previous STEO, which was published in April, the EIA projected that OECD production would be 33.89 million barrels per day and OPEC production would be 33.69 million barrels per day in 2023. That STEO saw total output averaging 101.30 million barrels per day this year.
OECD countries comprise Australia, Austria, Belgium, Canada, Chile, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Latvia, Lithuania, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, Slovakia, Slovenia, South Korea, Spain, Sweden, Switzerland, Turkey, the United Kingdom, and the United States.
OPEC countries are made up of Algeria, Angola, Congo (Brazzaville), Equatorial Guinea, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Saudi Arabia, the United Arab Emirates, and Venezuela.
Rystad: Global Gas Prices Fall Further On Limited Downstream Demand
Natural gas and LNG prices are falling amid weak demand and high inventories in Asia and Europe. And while cancellation of US LNG cargo deliveries is possible, it is unlikely as global benchmarks remain well above shut-in levels given prices at Henry Hub as well as liquefaction and transport costs, Rystad Energy said.
Month-ahead prices on Europe’s Title Transfer Facility (TTF) are around $7.90/MMbtu this week, down 15% compared with last week. The price of Asian spot LNG for July delivery fell 10% to about $8.80/MMbtu, primarily due to weak downstream demand during the shoulder season and high storage levels in Europe and Asia.
Gas markets in Europe, Asia
Europe’s gas storage is currently 68% full and is now trending 7% below the 5-year maximum.
In terms of pipeline supplies into Europe, Norwegian piped gas volumes increased to 213 million cu m/d (MMcmd) on May 30, up 2.2% on the week, following planned maintenance at some fields in Kaarsto and Visund. However, ongoing and upcoming maintenance is planned at Aasta Hansteen, Dvalin, Kaarsto, Kollsnes, Ormen Lange, Oseberg, and Troll, which will put some pressure on aggregate supply from Norway to Europe.
Meantime, an unplanned outage at Norne due to processing problems is impacting 6.5 MMcmd of capacity and has an uncertain duration.
Separately, gas pipeline flows from Russia into Europe totaled roughly 63 MMcmd as of May 28, down 5% week-on-week.
Regarding liquefaction plants, compressor failure took Norway’s 4.2 million tonnes/year (tpy) Hammerfest LNG Snohvit terminal offline for unplanned maintenance May 4. The plant restarted on May 27, marginally later than its initial expected restart date of May 19.
Gas storage levels at major Japanese power utilities remain high at 2.48 million tonnes (Mt) as of May 28, up 0.4% week-on-week, with some considering time swapping summer and winter cargoes.
Japan imported 1.16 Mt of LNG in the week ended May 26, down 15% year-on-year, with China importing 1.25 Mt, up 5% compared with the same week in 2022, and Thailand 0.26 Mt, some 3.7% less?compared with this time last year.
Global LNG supply
In terms of wider global LNG supply, Nigeria exported about 280,000 tonnes in the week ended May 26, 27% more compared with the same week in 2022.
In Western Australia, Pluto LNG has been undergoing maintenance since May 25, with the liquefaction plant expected to restart on June 19.
Pluto LNG’s operator, Woodside, confirmed the release of gas from the plant flare tower on May 26, but expected the turnaround schedule to be unaffected.
In the US, LNG feedgas rebounded in May as Cameron and Corpus Christi LNG returned to near full utilization in the week ended May 26. Meanwhile, Sabine Pass feedgas has dropped to 300 MMcfd to average 4.6 bcfd this month, but the plant is still 100 MMcfd higher than May 2022 averages.
US gas market
The US natural gas rig count declined to 137 units the week ended May 26, levels not previously seen since March 2022. Production continued to move higher, reaching 102 bcfd in the week.
Expectations of mild US weather triggering lackluster demand alongside gas production output improvements have kept the prompt month Henry Hub price steady, trading at $2.30/MMbtu as of May 30.
“US Lower 48?weather pattern proves to be a headwind for prices; we expect more volatility as the market exits shoulder season and moves firmly into the summer injection season. However, warmer temperatures in the second of June remain possible, which could provide some upside for prices,” Rystad Energy said.
领英推荐
CNOOC Begins Production From World’s Largest Deepwater Oilfield
CNOOC Limited announced that the Buzios5 project has commenced production safely.
The Buzios oil field is located in the Santos basin, southeast offshore of Brazil, with a water depth of 1,900 to 2,200 meters. It is the largest deep-water pre-salt oil field in the world, with a daily production of about 600,000 bbl at present.
Buzios5 is the fifth phase of oil field development. It will be developed with an FPSO and subsea production system. The project has already drilled 5 producing wells and 5 injectors. These wells will produce up to 150,000 bbl of crude oil, 6 MMcm of natural gas and inject 220,000 bbl of water per day.
The FPSO Almirante Barroso MV32 used in Buzios5 project was converted in China in July 2022 and arrived at the oil field in February 2023. It is able to store 1.4 million bbl of crude oil.
CNOOC Petroleum Brasil Ltda , a wholly-owned subsidiary of the Company, holds a 7.34% interest in the Buzios Shared Reservoir, while the operator Petrobras holds 88.99%, and CNODC Brasil Petróleo e Gás Ltda holds 3.67%.
Egina Slides Deeper Desperate For The Floor
The Egina field in deep offshore Nigeria has plunged further lower than the symbolic 100, 000Barrels of Oil Per Day
Its April 2023 output of 91,266BOPD is an even stronger signal of its unrelenting pace of decline since plunging to 145,000 Barrels of Oil Per Day BOPD, as of March 2022, a clear 25% decline in two years of production
The field commenced production in December 2018 and peaked at 200,000BPD in mid-2019.
Peak output, as a rule, for a field its size, (>500Million barrels estimated recoverable reserves) should take at least three years before descent.
On the contrary, Nigeria's "youngest large sized deepwater development started crashing rapidly from peak output in 2020.
The field now delivers less than Chevron operated Agbami and Shell operated Bonga complex, both of which have been in production for over 12 years.
Egina's rapid fall contrasts the argument that Nigeria's output decline is largely the result of pipeline sabotage, which obstructs evacuation from the flowstations to the terminals. It also challenges the notion that wells shut in out of economic or physical challenges are the major culprits for the country's production slide. What this precipitous drop calls for is massive investment in new field development away from easy targets of saboteurs
Totalenergies has commenced a nine-well drilling campaign including seven development and two exploration wells to halt the decline, but it's not clear if hook up of the new producers has commenced.
Renewable Energy Watch
100th Turbine Stands at Scotland’s Largest Offshore Wind Farm
100 out of 114 Vestas V164-10 MW wind turbines have been installed at what will be Scotland’s largest offshore wind farm – Seagreen – off the coast of Angus.
According to AIS, Cadeler’s wind farm installation vessel Wind Orca is at the offshore construction site 27km from the coast of Angus where it will install the remaining 14 units.
The first wind turbine was installed in early December 2021 by the Wind Osprey vessel, which was replaced by its sister vessel in April 2022.
Many of the wind turbines will be installed in a water depth of more than 55m, and the deepest water where a wind turbine has been installed so far was 59m
Once fully constructed, the Seagreen project, owned by TotalEnergies and SSE Renewables, will reach almost 1.6 GW.
Last year, the Scottish Ministers gave the developers the green light to increase the combined capacity of the remaining wind turbines, being developed as Seagreen 1A, from 360 MW to 500 MW.
Together with Seagreen’s 1,075 MW to be installed with the first 114 turbines, this will bring the project’s total installed capacity to 1,575 MW.
The first phase of Seagreen which is now under construction will connect to the grid in Tealing, Angus, while the further 500 MW from Seagreen 1A will come on land in Cockenzie, East Lothian.
Other stories we are following…
Cheers!