Market Report: ION Geophysical Corporation to Improve Mauritania’s Offshore and Onshore Exploration Strategy
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ION Geophysical Corporation, in partnership with Mauritania’s Ministry of Petroleum, Mines and Energy (MPME), announced the first multi-client 3D program in Mauritania. ION will integrate and reimage approximately 24,000km2 of MPME-held 3D data and will be able to expand the scope to include approximately 15,000km of 2D data, pending support from the industry.
Taking advantage of its latest technology and extensive reimaging experience, ION aims to significantly improve the resolution of the data and insights on the subsurface. Throughout the exploration and production lifecycle, the 3D volume has applications that will help reduce risk at play, prospect and reservoir scales.
“Through this project, ION will support the efforts of the Ministry to improve its exploration strategy offshore and onshore in the Taoudeni area and attract more investors to develop the national resources for the benefit of our nation and to build a long-term beneficial partnership, which are the ultimate goals of His Excellency the President of Mauritania,” said H.E. Mohamed Abdel Vetah, Minister of Petroleum, Energy and Mines.
According to Joe Gagliardi, Senior Vice-President of ION’s Ventures group, “We are pleased Mauritania selected ION to better understand its resources and attract new investments to the country, enabling all stakeholders to make more informed decisions. Recent world-class discoveries have identified huge volumes of natural gas. Mauritania’s subsurface has never been revealed on a regional 3D scale and we believe there is substantial potential to identify new prospective oil and gas opportunities in this proven, under-explored basin when viewed in this new context. We expect this data volume will play a pivotal role in unlocking Mauritania’s remaining hydrocarbon potential for years to come.”
The Nigerian National Petroleum Corporation (NNPC) reported that $6.2 billion was generated from the sales of petroleum products from May 2019 to May 2020. Nigeria also generated $6.1 billion from sales of Premium Motor Spirits, representing 98.84% of total sales in the same period. In May 2020, $24 billion was made from the sale of white products by the Petroleum Products Marketing Company.
According to Kennie Obateru, Spokesperson for the NNPC, the Corporation recorded a 43% drop in cases of damaged oil pipeline infrastructure in May 2020. NNPC’s monthly financial operations report indicated that 37 pipeline points were vandalized, compared to 65 pipeline points recorded in April 2020. The report also highlighted that the national natural gas production increased by 2.38% to 226.5 billion cubic feet in May 2020, compared to April 2020, translating to an average daily production of 7,480,36 million standard cubic feet of gas per day.
Audrey Joe-Ezigbo, President of the Nigerian Gas Association, emphasized the need to leverage Africa’s proven natural gas reserves of over 527 trillion cubic feet to build a renewable profile, which Nigeria should subsequently champion.
Total Gabon has agreed to sell its stakes in seven non-operated offshore fields to independent oil and gas company Perenco. The transaction included operatorship of the Cap Lopez oil terminal, subject to approval by the Gabonese authorities. The transaction is worth between $290-350 million, depending on future Brent prices, with the divested production totaling around 8,000 barrels per day (bpd) of oil in 2019.
“This transaction demonstrates our ability to high-grade Total E&P’s portfolio by monetizing mature fields with a high breakeven point,” noted Arnaud Breuillac, President of Exploration and Production at Total. “We remain fully committed to Gabon through our operated production clusters at Anguille-Mandji and Torpille-Baudroie-Mérou.”
On Thursday, August 6, 2020, crude oil prices reversed overnight losses to be traded higher, after a stronger-than-expected release of jobless claims data reassured the market that the U.S. economic recovery is still on track. The U.S. West Texas Intermediate crude futures were up 0.2% at $42.30 a barrel, while Brent was up 0.6% at $45.45 a barrel. The U.S. Energy Information Administration’s weekly report for Wednesday, August 5 showed that crude oil inventories decreased by 7.37 million barrels, more than double the 3.001 million-barrel draw forecasted, hence supporting prices.
The market regained its upward momentum on Thursday after the weekly report on jobless claims appeared to corroborate the picture created by the inventory numbers. U.S. news – coupled with earlier strong economic data out of Europe, where industrial orders leaped in Germany and production rebounded in Italy – overshadowed signs of weakening discipline among the OPEC+ group of producers in July.
Saudi Arabia had agreed to cut output by 2.5 million bpd, while Iraq agreed to cut output by 1.06 million bpd under the OPEC+ deal. Iraqi Minister of Oil H.E. Ihsan Abdul Jabbar said his country would make an additional cut in its oil production of about 400,000 bpd in August to compensate for its past overproduction under the OPEC+ supply reduction pact.
In other news, demand for offshore rigs will slump in 2020 because of the COVID-19 pandemic and the low oil prices that are forcing offshore operators to delay drilling activities. However, the offshore rig industry is set for a comeback in 2022.