Politics, Geopolitics & Conflict
The U.S. launched a drone strike in the Iraqi capital this week, killing a commander of Iran-backed Kai’tab Hezbollah, just days after the group had announced it had suspended all attacks against the U.S. following the death of three American soldiers in Jordan. This U.S. attack, as well as attacks on U.S. positions by pro-Iranian groups in Iraq threaten to dangerously destabilize the divided country.
Israel rejected a Hamas offer for a ceasefire deal that would have seen a hostage swap and an eventual end to the conflict, on the condition that Israel withdraw its forces. The rejection led to some market volatility this week.
In Ukraine, President Zelensky replaced his top military commander this week, following rumors of a pending shakeup. The top general who has now stepped down was under pressure from Kyiv allegedly for failing to penetrate Russian defenses. There are concerns that the shakeup will lead to less stability within the ranks; however, so far there are no indications of this.
Discovery & Development
Sintana Energy, together with Galp through the AVO-2 consortium, has successfully drilled and logged a deeper target in the Mopane-1X well in Namibia. Galp also made another discovery within Mopane-1X, with a second substantial column of light oil identified. A drill stem test will now be conducted to establish commercial viability.
Canada-Newfoundland and Labrador Offshore Petroleum Board…
Politics, Geopolitics & Conflict
The U.S. launched a drone strike in the Iraqi capital this week, killing a commander of Iran-backed Kai’tab Hezbollah, just days after the group had announced it had suspended all attacks against the U.S. following the death of three American soldiers in Jordan. This U.S. attack, as well as attacks on U.S. positions by pro-Iranian groups in Iraq threaten to dangerously destabilize the divided country.
Israel rejected a Hamas offer for a ceasefire deal that would have seen a hostage swap and an eventual end to the conflict, on the condition that Israel withdraw its forces. The rejection led to some market volatility this week.
In Ukraine, President Zelensky replaced his top military commander this week, following rumors of a pending shakeup. The top general who has now stepped down was under pressure from Kyiv allegedly for failing to penetrate Russian defenses. There are concerns that the shakeup will lead to less stability within the ranks; however, so far there are no indications of this.
Discovery & Development
Sintana Energy, together with Galp through the AVO-2 consortium, has successfully drilled and logged a deeper target in the Mopane-1X well in Namibia. Galp also made another discovery within Mopane-1X, with a second substantial column of light oil identified. A drill stem test will now be conducted to establish commercial viability.
Canada-Newfoundland and Labrador Offshore Petroleum Board has revised its estimate of producible oil from Equinor’s Cambriol G-92 discovery in the Flemish Pass Basin, now estimating 340 MMbbl of recoverable resources. The board handed Equinor an exploration license for “significant” oil discovery.
Deals, Mergers & Acquisitions
Oman’s 230,000 bpd Duqm refinery has finally reached full capacity, producing diesel and jet fuel. The refinery is a JV between Oman and Kuwait and is situated strategically with access to the Indian Ocean without having to go through the treacherous waters of the Strait of Hormuz or the Red Sea.
Sources have said that Devon Energy could acquire another North American oil and gas player, Enerplus, which has acreage in North Dakota. The acquisition could be valued at $3B and follows in the footsteps of other major U.S. oil and gas acquisitions over the last year, including Exxon and Chevron’s. Neither Devon nor Enerplus confirmed the negotiations. Both Enerplus and Devon have sold out of their Canadian assets.
Talks on a merger of Woodside and Santos have collapsed as the parties failed to agree on a valuation. The deal would have created a $50+B LNG behemoth. The talks have been ongoing for months, but the talks did not end with an official bid from Woodside.
Energy Earnings Beat
Exxon (NYSE: XOM) Exxon’s Q4 results showed a sharp drop in net profit and revenue, with $84.3 billion in revenue and other income and adjusted EPS of $2.18. Exxon’s cash flow from operations came in at $14.7 billion, with $37.5 billion in long-term debt. The total revenues and other income compares to $95.43 billion in Q4 2022. Net income attributable to Exxon was $7.63 billion, or $1.91 per share–compared to $12.75 billion in the same quarter of 2022.
Chevron (NYSE: CVX) Chevron reported earnings of $2.3 billion, adjusted earnings of $6.5 billion, compared with $6.4 billion in Q4 2022, $1.8 billion in upstream impairment charges and $1.9 billion in decommissioning charges for assets previously sold. Full year total earnings for 2023 was $21.4 billion, compared to $35.5 billion in the year prior.
BP’s underlying replacement cost profit for full year 2023 was $13.8 billion, compared to $27.7 billion in 2022. Q4 adjusted earnings were $1.07 per ADS on a replacement-cost basis. $52.3 billion in total Q4 revenues were reported, coming under expectations and falling well under the $70.4 billion reported for Q4 2022. BP reported total Q4 production of 1.42 million boepd–up from Q4 2022.
Imperial Oil recorded net income of $1.37 billion, with cash flow from operating activities of $1.31 billion, from upstream production of 452,000 boepd–a 30-year high. Imperial returned over $2.7 billion to shareholders in the quarter.
ConocoPhillips (NYSE: COP) said it saw earnings of $3 billion in the quarter, or $2.52 per share–down from $3.2 billion in Q4 2022. Adjusted earnings were $2.9 billion, or $2.40 per share. For full year 2023, earnings were $11 billion, or $9.06 per share, down from $18.7 billion in 2022.
