Tag Archives: oil

BTC flows to drop, according to Azerbaijan’s state budget

NOV. 25 2016 (The Conway Bulletin) — The Baku-Tbilisi-Ceyhan (BTC) pipeline will drop oil transport next year, according to a forecast in Azerbaijan’s state budget. In 2017, BTC will transport 31m tonnes, down from 32.5m tonnes that the government forecast for this year. In 2016, exports via BTC increased, but the share of Azerbaijan’s SOCAR in pipeline sales decreased in favour of its foreign partners.

ENDS

(News report from Issue No. 307, published on Dec. 2 2016)

UK’s Gunsynd invests in Azerbaijan

NOV. 30 2016 (The Conway Bulletin) — British investment company Gunsynd increased its stake in Zenith Energy, a Canada-based oil and gas company focused on Azerbaijan. Gunsynd bought 300,000 shares for £49,000 ($62,000) and now holds a 1.6% stake in the company. Zenith’s subsidiary, Zenith Aran Oil, signed a production sharing agreement with state-owned SOCAR in March for the exploitation of several small- scale oil fields.

ENDS

(News report from Issue No. 307, published on Dec. 2 2016)

Opec, Azerbaijan and Kazakhstan

DEC. 2 2016 (The Conway Bulletin) — Oil prices shifted up more than 10% after OPEC, the group of oil exporting countries, agreed to reduce output by 1.2m barrels/day starting in January.

This is good news for oil-rich countries across the South Caucasus and Central Asia, as the potential positive impact on oil prices could be sustained for a few months longer.

Throughout 2016, OPEC has repeatedly pledged to decrease output if non-OPEC countries also participated in the cut. In reality, though, the issue at stake was Saudi Arabia’s unwillingness to relinquish market share to Iran, who had just re-emerged from western sanctions and rapidly increased its output.

Now Saudi Arabia will slash 500,000 barrels/day from its output of around 11m barrels/day. Other OPEC countries will cut a total of 700,000 barrels/day and some non- OPEC countries pledged cuts for 600,000 barrels/day. For reference, the total cut would be 20% larger than Kazakhstan’s total oil production in 2016.

In fact, both Kazakhstan and Azerbaijan have used the OPEC deals as smokescreens to conceal declining production figures, as some of their projects have become unsustainable at low oil prices.

The output from the giant offshore field of Kashagan, which is three years late in hitting commercial levels of production, is no consolation either for Kazakhstan. Analysts have said that the field, sited in the northern part of the Caspian Sea, is profitable only with oil prices at $100/barrel at a minimum, a figure that is currently not on the horizon.

This means that Kazakhstan’s government will have to wait longer to reap the benefits of its largest oil basin.

ENDS

(News report from Issue No. 307, published on Dec. 2 2016)

Azerbaijan’s SOCAR Trading eyes China

NOV. 30 2016 (The Conway Bulletin) — SOCAR Trading, the Geneva-based subsidiary of Azerbaijan’s state- owned energy company, said it will look to boost sales to China after two experienced Chinese oil traders joined the company in November. In an interview with Reuters, SOCAR Trading CEO Arzu Azimov said that the company plans to enter the Asian markets.

ENDS

(News report from Issue No. 307, published on Dec. 2 2016)

Azerbaijan’s SOCAR buys in Ivory Coast

NOV. 25 2016 (The Conway Bulletin) — Azerbaijan’s state-owned energy company SOCAR said it bought a 26% stake in an LNG terminal in Ivory Coast, expanding its investment in West Africa. The CI-GNL terminal is operated by France’s Total. Earlier in November, SOCAR pledged investments in Benin and Burkina Faso.

ENDS

(News report from Issue No. 307, published on Dec. 2 2016)

Georgia may sell 25% stake in energy company in IPO

TBILISI, NOV. 29 2016 (The Conway Bulletin) — The Georgian government is considering selling a 25% stake in Georgian Oil and Gas Corporation (GOGC) on the London Stock Exchange next year, a move that would give foreign investors another chance to buy into Georgia.

GOGC is Georgia’s state-owned energy company, administering its oil and gas contracts and also refurbishing and building power stations to generate electricity. Selling a 25% stake GOGC is likely to generate high levels of investor interest.

Georgia’s finance minister Dmitry Kumsishvili said: “The corporation’s 25% stake will be placed on one of the exchanges abroad, in London or Shanghai.”

Georgia’s BGEO Group, which controls Bank of Georgia, and its subsidiary Georgian Healthcare Group are already listed in London.

GOGC controls the North-South pipeline used by Russia to export gas to Armenia and is building the 450km-long East-West pipeline network, that will link its southern border with Azerbaijan to the Black Sea port of Poti. It also owns a 51% stake in the $230m Gardabani power plant, one of the biggest in Georgia, which was opened last year.

Azerbaijan’s state-owned energy company SOCAR, which supplies gas to Georgia, has also said that it is interested in buying a 25% stake in GOGC, according to the Trend news agency.

ENDS

(News report from Issue No. 307, published on Dec. 2 2016)

OPEC courts non-members, including Azerbaijan

NOV. 24 2016 (The Conway Bulletin) — Azerbaijan’s energy minister, Natig Aliyev, said that OPEC had asked Azerbaijan and other non-OPEC members to cut oil production in an attempt to raise prices. Azeri newspaper Respublika quoted Mr Aiyev as saying that OPEC wanted non-members to cut up to 800,000 barrels of oil per day of production, a figure that it said would eat into the vast reserves. OPEC and non-OPEC members are due to meet again in Vienna on Nov. 28 to decide on the final level of cuts to production.

ENDS

(News report from Issue No. 306, published on Nov. 25 2016)

Stock market: Nostrum Oil & Gas

NOV. 25 2016 (The Conway Bulletin) — Amsterdam-based Nostrum Oil & Gas posted a decline in revenues it its Q3 report this week, but that didn’t stop investors buying its stock.

Nostrum’s stock price climbed back to November 2015 levels, seemingly dispersing the tough months of 2016, when oil prices plunged to around $30/barrel.

The company successfully cut costs and hopes to contain the drop in production to around 10% this year. Next year, the company will further reduce costs once it starts sending its oil through the KazTransOil pipeline due to be completed in Q2 2017.

“We look forward to realising a significant decrease in transportation costs once the KTO pipeline connection is complete by Q2 next year,” CEO Kai-Uwe Kessel said in a statement.

“Our focus now turns towards the 2017 drilling programme and delivering our major infrastructure project, GTU3, on time and on budget.”

ENDS

(News report from Issue No. 306, published on Nov. 25 2016)

Kazakhstan-based Nostrum revenues drop

NOV. 23 2016 (The Conway Bulletin) — Kazakhstan-focused Nostrum Oil and Gas posted a 35% fall in revenues for the first nine months of 2016, compared to the same period last year, a slight recovery compared to H1 results. Nostrum said it had successfully cut costs to counter sustained low oil prices. Production averaged 38,900 barrels/day in the reported period, down 12% from 2015. The company said it expects production to average 40,000 barrels/day by year-end.

ENDS

(News report from Issue No. 306, published on Nov. 25 2016)

Kazakhstan oil field goes commercial

NOV. 21 2016 (The Conway Bulletin) — Kazakhstan’s troublesome Caspian Sea oil field Kashagan has finally started producing oil on a commercial basis, Kazakh oil and gas minister Kanat Bozumbayev said in a speech to parliament. The project has been heavily delayed and has run several billion dollars over budget but the news still marks an important bench mark for Kazakhstan which is counting on Kashagan revenues boosting it into the top tier of global oil producers.

ENDS

(News report from Issue No. 306, published on Nov. 25 2016)