Oil
Norvarg hit for North Energy
LONDON – Norwegian explorer North Energy saw its net loss widen significantly in the fourth quarter as it was clobbered by a hefty impairment on the Norvarg gas discovery in the Barents Sea.
The Oslo-listed player was left with a quarterly net loss of Nkr112.2 million ($18.3 million), versus a negative Nkr59.6 million a year earlier, as it was forced to record a Nkr431.3 million pre-tax charge on exploration costs at the Total-operated find.
Norvarg, in which North Energy holds a 20% stake, is now deemed non-commercial due to a lack of resources after appraisal work last year.
Its full-year net loss widened to Nkr149.7 million from Nkr111.5 million in 2012 as exploration costs ballooned 29% year on year to Nkr697 million.
However, the impairment was cut to Nkr95 million after tax as North Energy is able to deduct 78% of exploration expenses under Norway’s fiscal regime.
The company was left with a Nkr164 million net cash position at year-end and has subsequently gained board approval for a Nkr285 million private placement in connection with its recent acquisition of EMGS’ electromagnetic data library in the Barents Sea, whereby it will also gain a Nkr75 million convertible bond loan.
The total Nkr360 million boost to its coffers leaves North Energy with sufficient funding to drill eight to 10 wells going forward, with the company participating in two wildcats this year – at the Statoil-operated Pingvin prospect in Barents Sea production licence 713 and Maersk Oil’s Tvillingen South prospect in PL510 in the Norwegian Sea, both in the third quarter.
The company is now screening prospects using so-called Virtual Drilling technology, based on a tie-up with Rex Oil & Gas, in combination with EM data to improve decision-making on exploration and minimise drilling of dry wells.
It is also refocusing its exploration strategy on the frontier Barents Sea, having secured licences in the Arctic region in Norway’s recent Awards in Pre-defined Areas round as well as angling for acreage in the south-east Barents in the upcoming 23rd licensing round.
– UPSTREAM ONLINE
Oil
FG Introduces New Incentives To Revitalize Nigeria’s Oil & Gas Industry
In a strategic move to revitalize Nigeria’s oil and gas sector, the Federal Government has unveiled two key fiscal incentives aimed at attracting investment and enhancing energy security.
The announcement was made by Mr. Wale Edun, the Minister of Finance and Coordinating Minister of the Economy on Wednesday.
The first initiative, the Value Added Tax (VAT) Modification Order 2024, introduces critical exemptions for essential energy products and infrastructure, including Diesel, Feed Gas, Liquefied Petroleum Gas (LPG), Compressed Natural Gas (CNG), Electric Vehicles, Liquefied Natural Gas (LNG) infrastructure, and Clean Cooking Equipment.
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These exemptions are designed to reduce living costs for Nigerians, promote energy security, and accelerate the transition to cleaner energy alternatives.
The second initiative, the Notice of Tax Incentives for Deep Offshore Oil & Gas Production, offers new tax relief options for deep offshore exploration projects.
This measure aims to position Nigeria’s deep offshore basin as a premier destination for international oil and gas investments, boosting the country’s appeal to foreign investors.
These reforms are part of a broader set of policy initiatives, known as Policy Directives 40-42, endorsed by President Bola Ahmed Tinubu.
The directives reflect the administration’s commitment to fostering sustainable development in the energy sector and enhancing Nigeria’s competitive edge in the global oil and gas market.
Business
Tinubu set to approve ExxonMobil-Seplat oil deal, expands CNG bus initiative
By Yemie Adeoye
NIGERIA’s President Bola Tinubu has announced that the protracted ExxonMobil-Seplat upstream oil divestment will be formally approved by the Minister of petroleum within a matter of days, just as he announced his government’s intention to expand the Compress natural Gas, CNG buses initiative.
The President who stated this during his Independence day nationwide broadcast stated that the move is in line with his administration’s commitment to free enterprise, free entry and free exit in investments which is the hallmark of his administration investment policy.
“Fellow compatriots, our administration is committed to free enterprise, free entry, and free exit in investments while maintaining the sanctity and efficacy of our regulatory processes. This principle guides the divestment transactions in our upstream petroleum sector, where we are committed to changing the fortune positively. As such, the ExxonMobil Seplat divestment will receive ministerial approval in a matter of days, having been concluded by the regulator, NUPRC, in line with the Petroleum Industry Act, PIA. This was done in the same manner as other qualified divestments approved in the sector.”
The President also seized the opportunity to plead with Nigerians to be patient with his administration’s reform policies. “As your President, I assure you that we are committed to finding sustainable solutions to alleviate the suffering of our citizens. Once again, I plead for your patience as the reforms we are implementing show positive signs, and we are beginning to see light at the end of the tunnel”.
“Our energy transition programme is on course. We are expanding the adoption of the Presidential Initiative on Compressed Natural Gas for mass transit with private sector players. The Federal Government is ready to assist the thirty-six States and FCT in acquiring CNG buses for cheaper public transportation.
Fellow Nigerians, while we are working to stabilise the economy and secure the country, we also seek to foster national unity and build social harmony and cohesion. Our economy can only thrive when there is peace”. he enthused.
Oil
ExxonMobil To Invest $10bn In Nigeria’s Deep-Water Oil Operations
As part of the administration’s push to improve Ease of Doing Business (EoDB), Nigeria’s Vice President Kashim Shettima has expressed support for ExxonMobil’s plan to invest $10 billion in the country’s deep-water oil sector.
Speaking on Wednesday, September 25, 2024, during a meeting with ExxonMobil executives at the 79th United Nations General Assembly (UNGA) in New York, Shettima called the investment “a clear testament to the administration’s economic reforms and investor-friendly policies.”
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This announcement follows news that international maritime company DP World intends to develop a multibillion-dollar port project in Nigeria.
Stanley Nkwocha, Senior Special Assistant to the President on Media and Communications, shared the development in a statement on Wednesday. He quoted Shettima as saying: “ExxonMobil’s potential investment aligns with the vision of President Bola Ahmed Tinubu’s administration for a more investment-friendly Nigeria.
We are committed to fostering an environment that supports such transformative projects.”Shettima also discussed the administration’s broader efforts to improve the ease of doing business, highlighting the “Renewed Hope Agenda,” which aims to simplify bureaucratic processes, enhance transparency, and offer fiscal incentives to attract global investors.
“Our administration has taken bold steps to unify the exchange rate, remove fuel subsidies, and implement tax reforms. These measures, though challenging in the short term, are intended to create a stable and predictable business environment in the long term,” he added.
On the oil and gas sector, Shettima mentioned that the government is revising the fiscal framework for deep-water operations to attract investment while ensuring fair returns for the Nigerian people.