Oil & Energy

Global Energy Advisory

Published

8 years ago

November 13, 2017

Saudi Arabia was in the spotlight this week, after a string of arrests on corruption allegations and muscle flexing in the direction of Iran. The so-called anti-corruption sweep toppled former and current ministers and several members of the Saudi royal family, sparking worry about a possible destabilisation in OPEC’s largest oil producer.
It has emerged in the meantime, however, that the operation might be primarily focused on money-gathering: to date, some $800 billion in assets of the people arrested have been frozen by the government and some observers have suggested the money will become state property, to go into propping up the government coffers.
At the same time, Saudi Arabia is baring its teeth at Iran, accusing it of a direct military attack after earlier this week the Iran-backed Houthi rebels in Yemen fired a missile at Riyadh, which the Saudi anti-missile system intercepted. The White House is backing the Saudis in their claims against Iran. Tehran has said the missile attack came in response to Saudi intervention in Yemen. This intervention, initiated two years ago, is a heavy load on Crown Prince Mohammed.
All these events have been bullish for oil prices but the latest from Saudi Arabia may have an opposite effect. Satellite imaging services provider Orbital Insights has released data suggesting Saudi Arabia has been lying about the state of its crude oil inventories. While Riyadh has been reporting a decline in these since early 2016, Orbital Insight data suggested a slight increase.
That data only comes from storage tanks on the ground, while Saudi Arabia also stores crude abroad, at foreign ports, and underground tanks. If stockpiles declined there then the Orbital data is irrelevant. If the Orbital data does indeed show cheating on the numbers, the OPEC production cut deal could well be dead in the water.
Deals, Mergers And Acquisitions
• French Total has bought the LNG exploration and production assets of Engie for $1.45 billion. The assets include a liquefaction plant in Louisiana, a number of long-term sales and purchase agreements, a fleet of LNG carriers, and access to re-gasification terminals in Europe. The deal also involves an additional consideration of $500 million if oil prices improve in the next few years.
• Australian Elk Petroleum has finalised the acquisition of the Greater Aneth oil filed in Utah, for a total $160 million. The seller is Resolute Energy Corp, which had a 63 per cent stake in the field, which is among the biggest CO2 enhanced oil recovery projects in the country. Its remaining recoverable reserves after a 30-year productive life are about 300 million barrels.
• China Energy Investment Corp. has signed preliminary agreements to invest $83.7 billion in U.S. LNG storage, power generation, and chemical production projects. The investment will be focused on West Virginian and was agreed during President Trump’s visit to China as part of his Asian tour.
• Noble Energy has agreed to sell 30,200 acres in the Denver-Julesburg Basin to SRC Energy for $608 million. The assets produce an average 4,100 bpd of oil equivalent from 600 drilling locations.
• Anadarko is selling its Moxa gas field in Wyoming for $350 million. The field’s output has been in decline since last year, with peak production at 96 million cubic feet daily. This has now, a year later, fallen to 72 million cubic feet daily. The company did not mention the name of the buyer.
Tenders, Auctions And Contracts
• Mexico’s tender for an oil and gas marketing firm was declared void this week, as it failed to attract any bids. The government organised the tender to pick a marketer that will sell the oil and gas produced under new contracts. Until 2013, when Pemex had a monopoly of the Mexican oil and gas market, the marketing of Mexican oil and gas was the charge of a Pemex unit, P.M.I. Comercio Internacional.
• The state oil companies of Iraq and Iran are discussing joint oil field development in Iraq, local media reported-two days after news of another ongoing negotiation concerning the possibility of shipping crude oil from Kirkuk fields to an Iranian refinery.
Discovery And Development
• China is preparing to launch the world’s largest offshore drilling rig in the South China Sea, to explore for gas hydrates, a potentially promising source of energy of which there may be vast reserves, according to scientific investigations. The Blue Whale 2 is a floating platform and can operate in 11,000 feet of water. What’s more, it can drill at depths of 50,000 feet, which is unprecedented.
Source: Oilprice Report for 10/11/17.

• Nigerian Oranto Petroleum has started exploration activities in South Sudan in partnership with geophysical survey services provider BGP. The Nigerian company has pledged $500 million for the exploration project, which contains an oil and gas block with reserves estimated at over 3 billion barrels of crude oil.
• Shell has started the construction of a $6-billion petrochemical complex in Pennsylvania, whose main feedstock will be natural gas form shale plays in the area. The complex will include three polyethylene plants with a combined annual capacity of 1.6 million tons, plus a steam cracker with a capacity equal to that of the polyethylene plants.
• UK-based Tower Resources plans to resume its exploration activities in Cameroon after a $2.76-million capital injection. The company is exploring for oil in the Thali license area, which has estimated oil-in-place resources of 39 million barrels. Drilling could begin as soon as next year, so the company can take advantage of the low prices for oilfield services while they last.
Regulatory Updates
• The chairwoman of the Senate’s Energy and Natural Resources Committee, Lisa Murkowski, has released a bill that would open the Alaska Arctic National Wildlife Refuge to oil and gas drilling if passed. The bill envisages at least two large-scale lease sales over the next ten years, spanning a minimum of 400,000 acres each. Surface development, however, should not exceed 2,000 acres, according to the bill. Environmentalists are unhappy about the legislation, arguing that recent leases sales in the North Slope have failed to yield any significant finds.
Politics, Geopolitics & Conflict
• The Niger Delta Avengers have announced an end to the ceasefire they had agreed with the Nigerian government and now once again oil infrastructure is fair game for the militant group despite calls from local community chiefs for its members to lay down their arms.
• Protests from local communities continue in Peru and are likely to continue to affect all natural resources industries present in the Andean country. Late last month, indigenous villagers ended a 43-day protest that had halted production in Peru’s largest oil block after signing a deal with the government. Protesters demander cleaning up oil pollution and from government to commit to including tribes in talks on long-term oil drilling plans, and the government accepted the terms. It is not announced why the protests were renewed. Oilfield in question, Block 192 is operated by Canadian Frontera Energy Corp but has not produced any oil from it since three indigenous tribes seized oil wells in mid September.
• The latest offshore tax haven leak, the Paradise Papers, could cause a headache for Glencore as they reveal the company hid its ownership stake in SwissMarine Corporation when it was negotiating its takeover of XStrata. Also, according to leaked documents, Aberdeen, Scotland-based Ithaca Energy is said to have set up a shell company in Bermuda in 2012 to purchase its share in a $50-million North Sea oil production platform.

Oil & Energy

Resource Wars Are Here and Oil Is the First Casualty

Published

6 days ago

March 30, 2026

The Tide

In just over a year, the world saw several instances of a choked supply of commodities indispensable for today’s economies and military capabilities.

From China’s restrictions on rare earths and critical minerals supply to the de facto closure of the Strait of Hormuz, policymakers and analysts began to realize that the control of oil, critical minerals, rare earths, and magnets is as important as building and maintaining stockpiles of advanced weapons. It also became clear that without these resources, defense and military capabilities could be weakened. The actual arms race goes hand in hand with the new battle for the resources that underpin economic, manufacturing, and advanced military development.

“Great-power competition has returned to basics: who controls the physical resources that modern economies and militaries run on,” Alice Gower, a partner at London-based political-risk advisory firm Azure Strategy, told the Wall Street Journal.

“Energy, critical minerals and industrial capacity are leverage, not just economic assets,” Gower added.

The war in the Middle East and the blockage at the Strait of Hormuz laid bare the reality of choked energy supply. The world’s most vital oil and LNG chokepoint, through which 20% of daily global trade flowed before the Iran war, has been essentially closed for most tanker traffic for more than three weeks.

The massive supply shock, the worst disruption in the oil market in history, showed that the world is dependent on energy resources, and that geography and actual physical supply matter. With so much oil and gas stranded in the Middle East, oil prices spiked to above $100 per barrel, natural gas prices in Europe doubled, and Asian spot LNG prices hit multi-year highs.

The precarious situation in the Middle East is reverberating across Asia, the region most dependent on oil and LNG supply from the Persian Gulf. Asian refiners pay sky-high premiums for non-Middle Eastern crude, many are considering cutting or have already cut processing rates, and countries have started to enact fuel-preserving measures, from four-day work weeks to bans on fuel exports.

In Europe, the gas refilling season will be the toughest yet, as Asia is outbidding Europe for spot LNG supply after Qatar’s LNG is effectively sidelined and full capacity may not return for up to five years following Iranian missile attacks last week.

Even the ‘energy independent’ United States, the world’s top oil producer, is not independent when it comes to global supply shocks of such magnitude.

The national average price of gasoline is approaching $4 per gallon nationwide, more than $1 a gallon compared to a month ago, before the start of the war.

Oil is a global resource, traded on a global market, and prices reflect fundamentals, although they have been driven by hectic trading activity on geopolitics in recent weeks. But the fundamentals show that there is no resource available to plug the gap that has opened in Middle Eastern supply. Producers are slashing output due to a lack of storage capacity, which further delays a rapid recovery in supply when this mess ends.

All this goes to show that whoever controls the Strait of Hormuz has enormous leverage on inflicting global economic pain.

While the world is focused on the Strait of Hormuz, the race for rare earths and critical minerals continues, with the U.S. and Western countries scrambling to dent China’s dominance.

Since China restricted exports of rare earth elements early in 2025, Western countries have raced to create mine-to-magnet supply chains to reduce dependence on Chinese supply in the key military and automotive industries.

China holds a 59% share of the mining of rare earths, 91% in refining, and a whopping 94% in magnet manufacturing, the International Energy Agency (IEA) estimates.

The U.S. has responded by taking stakes in minerals mining companies, the launch of a U.S. Strategic Critical Minerals Reserve, known as Project Vault, and is leading efforts to break the Chinese stronghold on the pricing of these minerals critical for the defense and auto industries and national security.

Chinese dominance could be eroded, but it would take years.

Still, rising neodymium-praseodymium (NdPr) supply from countries like the U.S. and Australia is set to reduce China’s market share to 69% by 2030 from 90% in 2024, Bloomberg Intelligence (BI) said in new research this month.

“We’re seeing a surge in rare-earth investment as modern technologies demand more critical materials,” said Jack Baxter, Global Metals & Mining Analyst at BI and co-author of the report.

“That said, we anticipate a significant shortfall in supply due to trade uncertainties, with lead times as long as 10 years to get new material out of the ground,” Baxter added.

“This will give pricing power to the few producers that currently are able to supply critical materials outside of China, fracturing the globalized market.”

Amid fractured markets and high geopolitical uncertainty, one thing is certain – the next arms race, alongside the actual arms race, will be for control of key resources such as oil and critical minerals.

By Tsvetana Paraskova

Oil & Energy

Transcorp Energy, Renewvia Partner On Renewable Energy Gap

Published

6 days ago

March 30, 2026

The Tide

Transcorp Energy Limited and Renewvia Solar Nigeria Limited have signed a Memorandum of Understanding to jointly develop renewable energy projects across Nigeria.

The move is aimed at addressing the persistent power deficit that has crumble businesses in the nation.

The agreement also outlines a longer-term plan to expand operations across Africa, positioning both firms to tap into growing demand for clean and reliable electricity.

The partnership would target commercial, industrial and residential consumers, as well as underserved communities, through a mix of off-grid and grid-connected energy solutions.

Beyond electricity provision, the collaboration would explore the aggregation and monetisation of Renewable Energy Credits generated from the projects, adding a commercial layer to the clean energy rollout.

The Managing Director and Chief Executive Officer, Transcorp Energy, Chris Ezeafulukwe, said the initiative aligns with the company’s broader strategy to expand access to sustainable power.

He noted that combining grid and decentralised energy systems would enable the company to deliver reliable electricity directly to end-users across different segments of the economy.

Chief Executive Officer of Renewvia, Trey Jarrard, described Nigeria as a critical market for the company’s African ambitions.

According to him, the partnership provides a platform to scale operations rapidly by leveraging established infrastructure and local expertise, while delivering cost-effective and resilient energy solutions.

Both companies said the agreement lays the foundation for a scalable pan-African renewable energy business, capable of supporting diverse markets and accelerating the continent’s transition to cleaner power sources.

The collaboration comes amid increasing pressure on governments and private sector players to deploy sustainable energy solutions to bridge electricity gaps, reduce reliance on fossil fuels, and support economic growth across Africa.

Oil & Energy

IYC Tasks Niger Delta Governors On Oil Field Bidding ….Decries Exclusion of Host Communities

Published

6 days ago

March 30, 2026

The Tide

The Ijaw Youth Council (IYC) Worldwide has raised concerns over the continued exclusion of host communities from the governance of oil resources, urging Niger Delta governors to take decisive steps by bidding for oil blocs and marginal fields.

The council warned that failure to act would allow external interests to continue dominating the region’s oil assets, despite their location within host communities.

Secretary-General of the council, Maobuye Nangi-Obu, started this at the stakeholders’ meeting organised by the Pipeline Infrastructure Nigeria Limited , with participants drawn from Rivers, Abia and Imo States, in Port Harcourt, recently.

“It is time for state governments in the Niger Delta, especially Rivers State, to form oil companies that can bid for marginal fields within their territories”, he said.

Nangi-Obu expressed concern over the reported listing of about 25 marginal oil fields for allocation, noting that many were located in host communities but allegedly being assigned to non-indigenes.

In his words “They sit in Abuja and decide what happens in our region, yet we are not part of the oil governance of our own resources”.

He explained that marginal fields, though considered uneconomical by major oil firms, remain viable for indigenous operators, adding that their allocation had continued to fuel grievances in the Niger Delta.

The IYC scribe also warned of the implications of directional drilling, describing it as a growing threat to host communities.

“There could be oil wells in your community, and somebody elsewhere could be drilling that oil without your knowledge,” he cautioned.

On environmental concerns, Nangi-Obu condemned the persistent gas flaring in the region, blaming both international and local operators for failing to invest in gas processing infrastructure.

He, however, commended Pipeline Infrastructure Nigeria Limited for its engagement with host communities.

“Pipeline Infrastructure Nigeria Limited is doing the right thing by engaging stakeholders. Not all companies are doing what they are doing,” he stated.

Traditional rulers at the meeting, further acknowledged improvements linked to the company’s activities in their areas.

The Eze Ekpeye-Logbo, King Kevin Anugwo, represented by Dr Patricia Ogbonnaya, noted that “aquatic life that disappeared due to pollution is gradually returning,” attributing the development to improved environmental conditions.

Similarly, Chairman of the K-Dere Council of Chiefs, Chief Batom Mitee, said, “There is now peace in our community,” stressing, increased oil production must translate into tangible benefits for host communities.

By: King Onunwor