11/20 Weekly oil & gas update

Shell sells Woodside share for USD2.7 billion

Shell has sold its entire stake in Woodside Petroleum—representing 13.3% of the company—to institutional investors for USD2.7 billion. The move is part of Shell’s USD30-billion asset sale program following the acquisition of BG. Proceeds from the sale will help to reduce Shell’s net debt

Venezuela’s crude output hits 28-year low

OPEC’s latest monthly data showed that Venezuela’s October crude production was 1.96 MMb/d—down from 2.09 MMb/d in September and the country’s lowest production level in three decades. Secondary sources cited an even lower October figure of 1.86 MMb/d. Venezuela’s annual reported production in 2016 and 2015 were 2.37 and 2.65 MMb/d, respectively

UAE will boost capacity of giant oil fields

Abu Dhabi National Oil Company (ADNOC) plans to boost the capacity of the giant Upper Zakum offshore oil field, the world’s second largest offshore oil field, to 1 MMb/d by 2024. ADNOC will also upgrade operations at the onshore Bab field and increase the capacity from 420 Kb/d to 450 Kb/d by 2020

Anadarko expects growing sales from production and lower capex in 2018

Anadarko forecasts a total of 245-255 MMboe of sales in 2018, a 10% increase compared to 2017. The company’s investment plan will focus on capital efficiency and financial discipline. Its capex plan of USD4.2-4.6 billion in 2018 is a slight decrease from the USD4.5-4.7 billion allotted this year

Nebraska approves Keystone XL pipeline route

Nebraska officials voted to approve a route for the Keystone XL pipeline through the state, removing a large obstacle for the delayed project. This came after TransCanada shut part of the Keystone pipeline following an oil spill last week of about 5,000 barrels in South Dakota

CB&I plans to supply first-ever residue upgrading technology in India

Indian Oil Corporation Limited has selected CB&I for the license, engineering design, and catalyst supply for a residue upgrading unit in Mathura, India. The scope of work also includes the supply of proprietary reactor internals, training, and technical services

China CNPC finalizes construction of the domestic pipeline to receive more Russian oil

China National Petroleum Corporation completed the last welding of a 941.8-km pipeline in northeast China. The pipeline is ready to start taking Russian oil starting January 1st and will enable China to receive 30 MMt, approximately 600 Kb/d, of Russian crude oil annually—double the current amount

Tellurian awards Bechtel with Driftwood LNG EPC contract

Tellurian has awarded Bechtel with four lump-sum turnkey agreements, worth a total of USD15.2 billion, for the engineering, procurement, and construction work on the Driftwood LNG project. Construction of the plant, which has a design capacity of 27.6 mtpa, is expected to begin in 2018 and reach first LNG production in 2022

Iberdrola announces the closure of its remaining coal-fired power plants in Spain

The power company has asked the Ministry of Energy for approval to shut down 874MW of coal fired capacity. The announcement comes after the company reaffirmed its commitment to reducing CO2 emissions at COP23 in Bonn

Average weekly oil & gas prices

Brent (USD/bbl): 62.26 (-1.52)
WTI (USD/bbl): 55.90 (-1.16)
Henry Hub (USD/mmbtu): 3.10 (-0.07)
TTF (USD/mmbtu): 6.62 (0.06)

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WTI-Brent differential to close as USGC refineries come back online after Harvey and Chinese stock building slows

With refineries returning online and Chinese imports slowing down, it’s likely that the WTI-Brent spread will normalize to USD 1.5-2/bbl over the next weeks.

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