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Oil prices on Friday were buoyed by the chances of delay in trade tariffs on Mexico by Washington. The prices jumped by more than 1% and were supported by the signs of supply cut extension by OPEC and other producers. Brent increased by 0.8% and was traded at $62.17 a barrel. WTI rose by 1% and was traded at $53.09 per barrel.
Mexican state oil firm Pemex has reported a decline in its oil exports in April. Its oil exports dropped by 11% compared to the statistics of the previous month. The production of the company also went down by 0.9%. The company is also struggling because of the debts of almost $106 billion. President of Pemex has assured the recovery of the company by increasing the production at least by 50%.
US' Talos Energy has successfully completed drill stem test (DST) of the Zama-2 side-track well (Zama-2 ST1) in Block 7, Mexico. Talos has 35% operating interest in Block 7 and the rest are held by Premier Oil (25%) and Sierra Oil and Gas (40%). During the DST operation, a combined flow rate of 7,426 barrels of oil per day was achieved from two separate tests.
Netherlands-based Ampelmann has inked its first contract in Mexico for providing offshore access services. With the award of this contract, Ampelmann has added a new region in its portfolio. The Dutch firm has deployed its fully motion compensated A-type system in Mexico, mobilised on a flotel. The system will enable safe transfer of personnel from vessels to offshore platforms, and back.
In a major acquisition move, Indonesia’s Medco Energi has settled to acquire London-based Ophir Energy in $511 million. Medco’s recent offer followed the previous offer of $437 million which Ophir rejected stating that it undervalued the company. The Jakarta-based oil and gas group is looking to expand its reach to international assets. Post-acquisition, Medco will gain rights to assets in Tanzania and Mexico.
The Mexico pipeline explosion on Friday has so far claimed 85 lives, according to a Minister. In a news briefing, Security Minister Alfonso Durazo told the reporters that state-owned Pemex considered the leak “minimal”, and did not shut the gasoline pipe despite an early warning from the military. Officials said that dozens of bodies were so badly charred that they will have to resort to DNA testing for identification.
An explosion in a ruptured pipeline burnt many people trying to fill containers with fuel in central Mexico yesterday. Television footage showed flames blazing from the burning pipeline in the municipality of Tlahuelilpan. State governor Omar Fayad denied knowledge of any deaths, but said that he had received reports that “many people” suffered burn injuries in the explosion.
Qatar Petroleum (QP) yesterday entered into an agreement with Italian energy multinational, ENI to acquire stakes in three oilfields, offshore Mexico. Briefing at a news conference in Doha, QP CEO Saad al-Kaabi informed about QP acquiring 35% stakes in in the Mexican oilfields. Production at these fields is projected to commence by mid-2019, which will be then ramped up to 90,000 bpd by 2021.
Mexico’s newly elected President yesterday revealed plans of constructing an $8 billion oil refinery and to renovate six others in a bid to lower Mexico’s dependence on imported fuel. Lopez Obrador, who took the President’s office in Dec, is looking to finance $3.65 billion for the state-owned oil major, Pemex. In 2018, Pemex has produced less than 1.8 bbpd of crude, heading towards 14th consecutive year of declining oil output.
Mexico-based Sierra Oil & Gas has inked an agreement with German E&P firm, Deutsche Erdoel AG (DEA AG) to integrate its business with DEA AG’s wholly-owned subsidiary, Deutsche Erdoel México. The integration will expand DEA AG’s portfolio in Mexico to ten exploration blocks and one onshore production block. The transaction is estimated to be completed during the first half of 2019.
Shell’s subsidiary, Shell Exploration and Production Company has awarded a contract to McDermott International, Inc. The contract is for new subsea umbilical and flowline installation at the Great White Frio development in Alaminos Canyon Block 857 in the U.S. Gulf of Mexico. The scope of work includes, project management and engineering along with installation of one 2,000-ft steel flying lead, installation of two EFLs and various other services.
McDermott International has secured a contract for concept and engineering services for Talos Energy's Zama field project. McDermott will manage this contract with io oil & gas consulting, a JV between McDermott and BHGE. The EPC giant will provide the follow-on pre-FEED services, based on the final concept solution identified by io. Work is expected for completion in 3Q2019.The Zama development is the first offshore Mexico block awarded to a private operator.
Eni Mexico has handed Japan’s MODEC a Letter of Intent for supplying, chartering and operating an FPSO vessel for its Area 1 project in Mexico. MODEC will carry out the engineering, procurement, construction, mobilization, installation and operation of the FPSO at the Area 1 project. First oil production by FPSO is scheduled in 2021.
Encana Corporation has entered into an agreement with DJR Energy to sell its San Juan assets in $480 million. Encana’s subsidiary, Encana Oil & Gas (USA) Inc. carried forward the transaction. DJR will gain ownership to San Juan assets which cover approximately 182,000 net acres. The transaction, which is expected to conclude by the fourth quarter of 2018, is subject to the satisfaction of closing conditions and customary closing adjustments.
The Tropical Storm Gordon is affecting the production in U.S. Gulf of Mexico. Evidently, three more oil producers have pulled their employees out of the storm’s path and production has reduced by 9%.The storm which was expected to progress westward has now shifted eastward. Companies like Talos Energy Inc. Exxon Mobil Corp and Chevron Corp, on Tuesday, vacated and shut many platforms in the eastern Gulf of Mexico.
Pemex-owned, Mexico’s largest refinery in Salina Cruz resumed operation, post a shutdown due to a power outage on Wednesday. The Salina Cruz refinery processes 330,000 barrels of crude oil per day (bpd). Mexico’s state-owned oil company, Pemex has increased processing at the refinery to somewhat more than 200 Mbpd of crude.
McDermott International has bagged a subsea pipeline flowline installation contract from PEMEX Exploration & Production. The contract is on a lump sum basis. McDermott will perform the design and detailed engineering, procurement, construction and installation (EPCI) for two subsea pipelines in support of Ayatsil field, offshore Mexico. Installation of the pipelines is slated for completion in the first phase 2019.
EPCI firm, McDermott International has been awarded a contract for the Perdido project of Shell in Mexico. McDermott will carry out the installation of umbilicals and flowlines for the development of Perdido in the Gulf of Mexico. Engineering and project management will be executed in Houston. McDermott’s North Ocean 102 installation is scheduled for completion in 2019.