June 3, 2016
I would have added a few more swear words in the title, but hey.
Dateline 2016-04-27, The Star:
HE year 2016 will be one marked with challenges for the oil and gas (O&G) industry, with slower progress in the upstream sector, according to the National Transformation Programme (NTP) annual report 2015.
The industry is no stranger to trying conditions, having gone through a similar cycle when oil prices went down below US$10 per barrel in 1998.
The difference this time around is that the industry and the players are better positioned to face uncertainties, having built competency and capacity over the years.
As an upside, the current situation creates a stronger impetus for O&G players to take measures that will inevitably strengthen their operations and help them create resilience against volatilities and unexpected industry developments.
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Posted by Wata
March 27, 2016
And China continues to buy their way into Malaysia.
Dateline 2016-02-01, Oil & Gas News:
Shell has reached a conditional agreement with Malaysian Hengyuan International Limited (MHIL) for the sale of its 51% shareholding in the Shell Refining Company (SRC) in Malaysia for $66.3 million. It is MHIL’s intention for SRC to invest in the upgrades needed to meet the Euro 4M and Euro 5 requirements. The transaction is expected to complete in 2016, subject to obtaining regulatory approval.
Shell Malaysia Trading will ensure security of supply to its retail and commercial customers in Malaysia and honour other existing commitments through an existing comprehensive supply strategy that includes a long term offtake from Shell Refining Company.
The sale is consistent with Shell’s strategy to concentrate its global Downstream footprint and businesses where it can be most competitive. Malaysia continues to be an important country for Shell. Shell is the leading retail fuels and lubricants provider and continues to invest in growing these businesses in the country.
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Posted by Wata
March 17, 2016
M3nergy must be happy. FPSO operation team probably isn’t.
Dateline 2016-01-22, UPI:
Swedish energy company Lundin Petroleum said it was taking in cash after shedding infrastructure in Malaysia it said is not part of its core business strategy.
Lundin said it agreed to sell offshore floating production and storage vessel Bertram to M3Energy Investment Ltd., a state-controlled energy company in Malaysia, for $265 million.
“Owning infrastructure assets is not part of Lundin Petroleum’s core strategy and this transaction will allow us to redeploy this capital into other areas of our business to fund our value driven growth,” President and CEO Alex Schneiter said in a statement.
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Posted by Wata
February 23, 2016
I would keep an eye on MISC.
Dateline 2016-01-12, The Star:
AmResearch has maintains its “neutral” call on the oil and gas (O&G) sector as prospects for a sustainable turnaround in crude oil prices still appear opaque at this stage.
“Given the current oil glut, which has adversely affected upstream players, we are positive on downstream and storage operators. As such, we prefer companies with stable and recurring earnings such as Dialog Group and Yinson.
“We also like O&G downstream players such as MISC, which benefits from the growth in petroleum shipping charters and new build slowdown,” AmResearch said.
Bloomberg reported that Petroliam Nasional Bhd’s (Petronas) CEO Datuk Wan Zulkiflee Wan Ariffin as saying that the group was bracing for two to three more tough years with crude at an 11-year low while seeking to keep its multi-billion dollar projects on track.
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Posted by Wata
February 2, 2016
Dateline 2015-12-21, The Malay Mail:
The oil and gas industry is expected to consolidate amid the pervasive low oil prices which have led to reduced investments and slower production rates, said Deloitte Malaysia.
“The effect has been highlighted by mature oil fields, marginal oil fields and high cost of exploration that runs long term for potential deep water assets, which have a high break-even point.
“Falling oil prices are forcing oil and gas companies to seriously review the economics or defer these capital-intensive projects,” its Energy & Resources Leader Nizar Najib said in a statement.
Nizar said although new refining projects in Sabah and Johor will significantly increase Malaysia’s refining capabilities as part of the government’s agenda to become a regional oil and gas hub by 2020, falling oil prices, consolidation in the industry and subdued domestic consumption may have a negative impact on the sector, at least in the medium term.
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Posted by Wata
January 22, 2016
Nuclear, Nuclear.
Dateline 2015-12-18, Borneo Post:
The oil and gas industry has been sluggish in 2015 and prevailing low oil prices will continue to cast a bleak outlook in the medium-term.
From the peak of US$112 per barrel reached in June last year, Brent, the global benchmark, almost halved its price, plunging to US$61.31 in June this year.
It has been steadily falling to below US$50 per barrel since August before dropping to US$36.33 on Dec 14, slightly above the low of US$36.20 seen during the 2008 financial crisis.
The weak oil price trend is caused by the oil supply glut following the booming shale industry in the United States while the Organisation of the Petroleum Exporting Countries (OPEC) refused to cap its production, estimated at about 31 million barrels per day (bpd).
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Posted by Wata
January 19, 2016
Dateline 2015-12-14, The Star:
The price of piped gas in Peninsular Malaysia, which will be increased by RM1.50 per million metric British thermal units (mmBtu) for January-July 2016, is still sold below the market price, said Tenaga Nasional Bhd (TNB) chairman Tan Sri Leo Moggie.
However, under an agreement between TNB and Petroliam Nasional Bhd (Petronas), gas is supplied at RM15.20 per mmBtu for the first 1,000 million standard cu ft per day (mmscfd) compared with the liquefied natural gas (LNG) market price of RM46.041 quoted by Petronas for the period from October to December 2014.
He said under the Government’s subsidy rationalisation programme, the piped gas price would be revised gradually every six months until it reached the market price.
“However, at the moment it is still subsidised (by the government),” he told a press conference after TNB’s AGM in Kuala Lumpur on Monday.
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Posted by Wata
January 10, 2016
Dateline 2015-12-03, The Malay Mail:
National oil giant Petronas will extract only marginal benefits from the Trans-Pacific Partnership (TPP) should Malaysia sign on, said a report by consultancy firm PricewaterhouseCooper (PwC) released today.
PwC noted that Petronas mostly exports to countries that are not part of the free-trade deal, adding that there are currently no or close to zero taxes imposed on its products that are sold to TPP member countries.
“The potential gains to Petronas from lower trade barriers are expected to be minimal. 74 per cent of Petronas’ exports are to non-TPP countries.
“In addition, a significant portion of Petronas’ export to the TPP countries already incur zero tariffs. For example, 60 per cent of Petronas’ export of liquefied natural gas (LNG) are destined to Japan at zero tariffs,” it said in its cost-benefit analysis of Malaysia’s signing of the TPP.
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Posted by Wata
October 16, 2015
Nah, wait till 2H2016.
Dateline 2015-09-14, The Star:
IT is often regarded that the best time to accumulate a stock is when nobody is looking at it. Would that hold true for oil and gas [O&G] stocks whose prices have been beaten down in the wake of the collapse of oil prices?
“Yes and no, perhaps one can start looking at certain O&G companies that are not so directly impacted by the oil price and those that are in the brownfield segment,’’ said a senior analyst.
The analyst added that earnings for KNM and Dialog were more tied to jobs related to the massive Refinery and Petrochemical Integrated Development (Rapid) project by Petronas at Pengerang, Johor.
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Posted by Wata
September 20, 2015
Dateline 2015-08-17, Platts:
Malaysia’s state-owned Petronas posted stronger refining margins in the second quarter and saw a near 3.5% growth in crude, condensate and natural gas production, but warned of tougher times ahead as it sees little scope of oil prices recovering in the second half of the year.
Petronas CEO Wan Zulkiflee Wan Ariffin said the acquisition of a 47% stake in Malaysian Refining Company late last year helped the company to boost its refining margins to “double digits” in the quarter that ended on June 30, from about $8/b in the previous quarter.
“As a result of the increased capacity through this acquisition, we could post stronger refining margins,” Wan Zulkiflee told reporters while announcing the company’s Q2 results in Kuala Lumpur.
“But there is a confluence of events that is not supporting high oil prices,” he said. “There is a chronic oversupply situation. Therefore, we expect oil prices will remain depressed for the rest of the year.”
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Posted by Wata
Wata - Malaysian Oil and Gas Engineer 