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Iraq signals progress in talks with KRG, IOCs

  • Market: Crude oil
  • 10/06/24

Iraq's oil minister Hayyan Abdulghani said progress has been made in negotiations with the Kurdistan Regional Government (KRG) and international oil companies (IOCs) on resuming crude exports via Turkey.

"There is a progress in these negotiations, and we hope that in the coming few days we will reach a final understanding in this regard," Abdulghani told Iraqi state-run TV channel Iraqiya.

Abdulghani attended a meeting in Baghdad on 9 June with representatives from the KRG's natural resources ministry and most of the IOCs that operate in Iraq's semi-autonomous Kurdistan region. The talks were aimed at reaching a deal to resume exports of northern Iraqi crude via Turkey's Mediterranean port of Ceyhan.

Around 470,000 b/d of crude exports from the Kurdistan region have been absent from international markets since March last year after Turkey closed the pipeline linking oil fields in northern Iraq to Ceyhan. The closure followed an international tribunal ruling which said Turkey had breached a bilateral agreement with Baghdad by allowing Kurdish crude to be exported without the federal government's consent.

Sunday's tripartite meeting involved representatives from all but one of the IOCs that operate in the Kurdish region. Norway's DNO, which holds a 75pc stake in northern Iraq's Tawke and Pehsakbir fields, was absent, according to two sources with knowledge of the matter.

An oil ministry source denied that a condition of the IOCs' attendance at the meeting was that they provide a copy of their production-sharing contracts (PSCs) with the KRG. A source close to the IOCs said it had been a condition but was eventually dropped.

Baghdad has previously proposed a middle ground agreement that would see it amend its federal budget to allow it to pay IOCs operating in Kurdistan, in return for a compromise with the KRG and the IOCs over the recovery costs they claim for oil produced in the region.

A resumption of northern Iraq crude exports could complicate Baghdad's relations with Opec+, given Iraq is already struggling to comply with its Opec+ commitments. It recently submitted a plan outlining how it will compensate for producing above its target in the first quarter.

Iraq's production rose by 20,000 b/d to 4.16mn b/d in May, according to Argus estimates, leaving it 160,000 b/d above its target.


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24/02/25

Italy's Saipem to merge with Norway's Subsea 7

Italy's Saipem to merge with Norway's Subsea 7

London, 24 February (Argus) — Italy's Saipem and Norway's Subsea 7 have agreed to merge, creating a global energy services company with revenues of around €20bn/yr ($21bn/yr) and an order backlog of €43bn. The move is designed to create the scale to tackle large and complex energy projects focused on engineering and construction (E&C) but also on energy transition projects such as wind and carbon capture. Saipem held talks with Subsea 7 over a possible tie-up several years ago but failed to reach an agreement. "The combination will give us a scale that is more in harmony with the magnitude of the projects in offshore energy for oil and gas and renewables industries," said Kristian Siem, chairman of Subsea 7. Under the merger, Subsea 7 will be folded into its Italian rival, with shareholders of the Norwegian company receiving 6.688 Saipem shares for each share they own, along with an extraordinary dividend of €450mn. Each set of shareholders will hold 50pc of the new company on completion. Saipem's largest shareholders — oil and gas firm Eni and state lender CDP — and Subsea 7's largest shareholder Siem Industries have all entered into a separate agreement to support the deal. The new company, Saipem 7, will have a fleet of more than 60 vessels which management says will give it the flexibility to better respond to client requests. "The new company is very, very much an offshore E&C company," said Subsea 7 chief executive John Evans, noting that over 80pc of its operating income comes from this segment. "The two fleets are very compatible and complementary and will allow clients to have a single global service provider to provide everything from ultra-shallow water in the Middle East to ultra-deep in some of the newer provinces," he said. Asked if the new company would be asset light by leasing more of its vessels, Evans said the model of combining older company-owned ships and leased units would continue. "You have to remember that with our backlogs we will be very busy for the next 2-3 years," he said. The merger is expected to generate annual synergies of around €300m in the third year after completion, driven in large part by fleet optimisation and procurement. It is scheduled to close in the second half of 2026 with a binding merger agreement expected mid-2025. Saipem 7 will be listed in both Milan and Oslo and will be headquartered in Milan, although the offshore E&C business will be run as a separate business based in London. Saipem chief executive Alessandro Puliti, who will take over the role of chief executive at Saipem 7, said any decision to spin off the offshore E&C division at a later stage would be evaluated on an opportunistic basis. Puliti said the new company is expected to pay a dividend of at least 40pc of free cash flow after repayment of lease liabilities. By Stephen Jewkes Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Grangemouth refinery site to get $253mn in public funds


24/02/25
News
24/02/25

Grangemouth refinery site to get $253mn in public funds

Edinburgh, 24 February (Argus) — The UK government has committed £200mn ($253mn) for investment in clean energy for the site where UK-Chinese firm Petroineos' 150,000 b/d Grangemouth refinery, due to be permanently shut this year, is located. The government said on 23 February that it will work alongside private sector partners to develop new industries and leverage additional funding through the £200mn in public investment allocated from the UK's National Wealth Fund (NWF). The NWF was set up last year by the government to support investment in clean energy industries and mobilise private sector involvement across the UK. "The funding will be available for co-investment with the private sector to help unlock Grangemouth's full potential and secure our clean energy future," UK prime minister Keir Starmer said. Petroineos is planning to close the Grangemouth refinery in Scotland, this year and turn it into an import terminal because of high costs and declining fuel demand in Europe. Refineries in Europe have long faced competitiveness issues from larger and newer refineries in other regions including the Mideast Gulf, Asia-Pacific and Africa. Around 30 refineries have closed in Europe since 2000, while 2.5mn b/d of crude distillation capacity was added outside the region in the past three years alone. Only around 65 workers will be retained by Petroineos to run the terminal once the Grangemouth refinery closes. The government committed to provide a training guarantee for the staff at the refinery to gain new skills at local colleges. UK union Unite welcomed the announcement, saying that the "significant investment should be the start of a real industrial plan for Grangemouth that both safeguards Scotland's energy security and delivers the jobs of the future." But the union warned that clear timescales for the development of Grangemouth and details on jobs were needed. Unite is supporting the conversion of the refinery into a biorefinery for the production of sustainable aviation fuel (SAF). Petroineos said last year that it did not deem the refinery conversion viable, after having considered it. The firm did not immediately reply to a request for comment following the release of the new government funding. The UK government announcement comes after Scotland's first minister John Swinney committed to allocate £25mn from the proceeds of the Scottish offshore wind leasing round ScotWind to establish a just transition fund for Grangemouth. "The aim is to expedite any of the potential solutions that will be set out in the Project Willow report, as well as other proposals that will give Grangemouth a secure and sustainable future," he said last week. Project Willow is a feasibility study commissioned by the UK and Scottish governments to identify long-term industrial options for the site. The report is due to be released this spring. By Caroline Varin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Republicans target US energy rules for disapproval


21/02/25
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21/02/25

Republicans target US energy rules for disapproval

Washington, 21 February (Argus) — Republican leaders in the US House of Representatives hope to disapprove at least seven energy-related measures issued under former president Joe Biden using a filibuster-proof process created under the Congressional Review Act. House majority leader Steve Scalise (R-Louisiana) on Thursday released a list of 10 rules that his party has prioritized as "potential targets" for disapproval votes, which require only a simple majority to pass in each chamber. Republicans previously used the law in 2017 to successfully unwind more than a dozen rules, and they hope to do so again to repeal Biden-era rules they say will unnecessarily raise costs on businesses and consumers. A US Environmental Protection Agency (EPA) regulation that implements a $900/t charge on oil and gas sector methane leaks is among the rules that Republicans want to disapprove. If those implementing rules are scrapped, it would provide a temporary reprieve from a 31 August deadline for operators having to pay billions of dollars in potential fees on methane emitted in 2024. Republicans hope to vote later this year to permanently end the methane charge, which was created by the Inflation Reduction Act. House Republicans also hope to disapprove an offshore oil and gas safety rule for drilling in deepwater "high pressure, high temperature" environments that Scalise's office says will increase "burdens on energy operations". Other rules that Republicans will target for disapproval are energy conservation for gas water heaters, energy efficiency labeling standards and air pollution restrictions on rubber tire manufactures. Two of the energy measures House Republicans say they plan to target might not qualify for disapproval under the Congressional Review Act, which can only be used on a "rule". The first is a waiver that would allow California to boost in-state sales of electric vehicles and plug-in hybrids, and that President Donald Trump's administration has tried to make eligible for repeal. The second is the US Commodity Futures Trading Commission's decision to release voluntary guidance for exchanges that allow trading of carbon offset futures. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Uruguay eyes oil, gas E&P within energy transition


21/02/25
News
21/02/25

Uruguay eyes oil, gas E&P within energy transition

Montevideo, 21 February (Argus) — Uruguay's state-run Ancap has hopes for an offshore oil or gas discovery, even as the country gears up for its second energy transition. Uruguay has had only three exploratory wells drilled in its history, two in 1976 and one in 2017, and they all came up dry. Companies have completed 13,000 km² of 2D and 41,000 km² of 3D seismic testing this century. Today, its seven offshore blocks have contracts, plans are underway for a new round of seismic testing and one company, US-based APA, wants to spud an exploratory well in its wholly operated block 6 in late 2026 or early 2027. "For the first time in history, we have contracts in place for all the blocks and there is a great deal of interest that resources can be found" in Uruguay, Santiago Ferro, Ancap's energy transition manager, told Argus . A public hearing on seismic testing was held 13 February and the environment ministry is reviewing proposals for permits. Ferro said seismic testing will only be done in areas lacking data. "We want to take advantage of existing information and complement it with new data to encourage drilling," he said. The plan is for approximately 5,000 km² (1,930 mi²) of new seismic testing on two areas — block 1, operated by Chevron and UK-based Challenger Energy Group, and block 4, operated by Shell and APA. The work will likely happen in the final quarter of this year. Ancap's plans will unfold under the new left-wing government of president-elect Yamandu Orsi, who takes office on 1 March. The Oris administration is committed to deepening Uruguay's energy transition. It already has one of the greenest power grids, with 99pc of power coming from renewables, and the Orsi government wants to guarantee electrification of the transportation sector. He will arrive at his inauguration in an elective vehicle as a sign of the government's commitment. The administration wants to decarbonize transportation in 10 years, which will require incentives for vehicles and investment in additional renewable power, principally solar energy. It has not taken a public stand on oil and gas exploration or what it would do if recoverable resources were discovered. By Lucien Chauvin Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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France's US crude imports at record again in December


21/02/25
News
21/02/25

France's US crude imports at record again in December

Barcelona, 21 February (Argus) — French crude imports in December included a record amount from the US for a third consecutive month, and the US was France's largest crude supplier in 2024. Customs data show imports at 4.2mn t (990,000 b/d) in December, down by 2pc on the year and down from 4.3mn t a month earlier. Deliveries in 2024 were 47.1mn t, lower by 2.4pc on the year. Deliveries of US crude were 1.34mn t in December, up from slightly more than 1.25mn t in November and just over 1.2mn t in October. US crude has continued to arrive in January and February. The US was the largest supplier to the Mediterranean port of Fos-Lavera in January , with more cargoes arriving there and at the Atlantic Le Havre terminal this month, according to Argus tracking. The US is now by far the biggest supplier to France. It provided 11.5mn t of crude in 2024, up from 9mn t in 2023, with the large majority being light sweet WTI. The US supplied no crude to France 10 year ago. The growth since has significantly altered the French crude slate, pushing it lighter and less sulphurous. As recently as 2019, when 4.4mn t of US crude arrived, medium sour grades Saudi Arab Light and Russian Urals accounted for more than 15mn t between them, split 2:1 in favour of Saudi Arabia. Sanctioned Urals was absent in 2024 for a second year in a row and Saudi Arabia supplied just 1.3mn t, down from 3.5mn t in 2023. There has not been a major shift in other suppliers (see chart) . Last year Nigeria supplied 6.4mn t, down marginally on 2023, Kazakhstan shipped 5.3mn t down from 5.6mn t and Algeria 4.2mn t, down from 4.6mn t. While French refinery availability has been plagued by problems since the fourth quarter of 2019 , the lighter sweeter crude slate has resulted in higher production of light products naphtha and gasoline . This increase has occurred even after TotalEnergies definitively closed its 93,000 b/d Grandpuits refinery at the start of 2021. There is the possibility of continued support for US shipments this year. Alternative light sweet Libyan crude can be prone to political disruption, Nigerian domestic crude consumption is growing as the 600,000 b/d Dangote refinery ramps up , and Kazakhstan is under pressure to compensate for exceeding its Opec+ output target and could limit deliveries of CPC Blend. By Adam Porter French crude imports mn t Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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