January 2024, Vol. 251, No. 1

Global News

Global News January 2024

Saipem Wins Guyana, Brazil Contracts Worth $1.9 Billion 

Italian energy engineering and infrastructure company Saipem signed two offshore contracts in Guyana and Brazil, valued at $1.9 billion in total, the company said. 

In Guyana, Saipem won a contract from ExxonMobil Guyana Limited for the proposed Whiptail oilfield development, located in the offshore Stabroek Block. 

Saipem also received a contract a contract in Brazil by Equinor, for the Raia project, which envisages the development of a pre-salt gas and condensate field in the Campos Basin, located 124 miles (200 km) offshore the state of Rio de Janeiro, the company said. 

The Brazil project is one of the country’s most significant gas development initiatives and would cover 15% of the total domestic gas demand in the country if competed, Saipem said. 

Japan Approves JERA Plan to Keep Surplus LNG in Winter 

Japan’s industry ministry came out in support of power generator JERA, which wants to keep a surplus of LNG in the winter as a strategic reserve in case of supply disruptions, its minister said. Japan has strategic oil reserves but not ones for LNG. 

Under the new plan, JERA will buy and store the equivalent of at least one additional tanker a month, beginning in December and extending to February, when heating demand increases. The company will provide the emergency supply to domestic companies if and when requested by the ministry. 

“LNG plays an important role in the supply of electricity and gas in Japan, and with the tightening global gas supply, we are strategically securing surplus LNG in case of temporary supply disruptions,” Industry Minister Yasutoshi Nishimura told a news conference, according to Reuters. 

Japan was the world’s largest LNG importer during 2022, has decided to build a “strategic buffer LNG” during the peak winter demand season, to ensure stable supply of the super-chilled fuel after last year’s energy crunch. 

LNG inventories held by major Japanese power were at 2.49 million metric tons as of Nov. 19, above a five-year average of 2.12 million tons for end-November, METI data shows. 

JERA is a Tokyo Electric Power and Chubu Electric Power venture. 

UAE to Increase Murban Crude Exports in First Quarter 

The United Arab Emirates will bolster exports of Abu Dhabi’s flagship Murban crude early in 2024, as the new OPEC+ mandate goes into effect and barrels are diverted to the international market owing to refinery maintenance, Reuters reported. 

That will add to increased output of other light sweet crude grades, including from fellow OPEC members Nigeria and Angola and non-OPEC countries, such as the U.S. and Brazil. 

“The market expects bigger supply of Murban crude next year,” a Singapore-based trading source, who declined to be identified, told Reuters. 

The UAE production baseline under OPEC+ agreements is set to rise 6.2% to 3.219 million bpd this month. At the same time, maintenance work at Abu Dhabi’s 837,000 bpd Ruwais refinery means less crude demand domestically. 

Oil supplies are currently in deficit, but the International Energy Agency expects that status to swing to a slight surplus in 2024, even if OPEC+ nations extend their cuts into next year. 

Indonesia Launches First Carbon Storage Project in West Papua 

Indonesian construction on a carbon capture, utilization and storage (CCUS) project in West Papua province — the first of its kind in the nation — got underway recently. 

The CCUS project, operated by BP Plc, could potentially store up to 1.8 gigatons of carbon dioxide, energy minister Arifin Tasrif said in a statement. 

In September, an energy ministry official said BP will invest $2.6 billion in the project, with the first carbon injection expected in 2026, according to Reuters. 

The new project comes on the heels of the $4.83 billion Tangguh Train 3 LNG project in West Papua, completed in November. 

Indonesia has an estimated carbon storage capacity of 8 gigatons in depleted oil and gas reservoirs and 400 gigatons in saline aquifers. 

Energy ministry data shows there are currently 15 CCS and CCUS projects in various stages of preparation in the country, with a combined investment of nearly $8 billion—including BP’s project. 

Venezuela Producing More Oil, Hoping to Regain U.S. Market 

Venezuela is producing 850,000 bpd of oil at the moment, and the country should reach the 1 MMbpd mark, Deputy Oil Minister, Erick Perez, said. This comes after the temporary removal of U.S. sanctions on the country. 

In October, the U.S. issued a license allowing Venezuela to export oil, gas and fuel to its chosen markets through mid-April, to encourage negotiations for a fair presidential election next year.  

“We have set a plan with several phases: recovery, stabilization and growth. Of course, six months in the oil industry is a short time [but] will allow us to progress. In the medium term, we will see the results,” Pezez said during an energy conference in Caracas. 

The nation has about 5,000 active wells for crude and gas output, and its natural gas production currently averages some 4 Bcf, according to the government. The output in October was 786,000 bpd. 

Venezuela is said to progressing in discussions with Trinidad’s for the Dragon field, a U.S.-authorized offshore project. Trinidad’s National Gas Company (NGC) and Shell that would provide Venezuelan gas for producing LNG and petrochemicals. 

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