Oil
Shell, Sinopec drilling for shale gas in Central China
BEIJING – Royal Dutch Shell and China’s Sinopec Corporation are drilling exploration wells to test shale potential in central China, where little prospecting for the fuel has been done, company officials said on Thursday.
China, believed to hold the world’s largest shale gas resource, has drawn international firms like Shell, Exxon Mobil , Chevron, Eni and Total to hunt for the unconventional gas, with Shell the first among them to land a production sharing contract.
Shell and Sinopec have completed drilling Liye-1, one of three exploration wells planned in a joint evaluation of shale resources at Xiang E Xi (XEX) block, at the junction of central Hunan, Hubei and Jiangxi provinces in east central China.
The joint study agreement (JSA) on the XEX block was entered into in June 2012 but has not been widely reported.
A Sinopec official said the Liye-1 well was completed last August but was subsequently sealed after results from hydraulic fracturing were not “very satisfactory”. The official declined to be named as he’s not authorized to speak to media.
Shell and Sinopec are now drilling the second well, Engye-1, and a third one is also planned, officials said. Sinopec is the operator of the project.
China, still in the early stages of developing the fuel, has drilled less than 150 exploration wells, mostly in and around the Sichuan basin in southwest China. Commercial output is tiny.
In Sichuan, Shell is conducting appraisal drilling of the Fushun-Yongchuan block in partnership with top Chinese oil and gas producer PetroChina . The two are looking to start commercial production after 2014.
Shell secured China’s first shale gas product sharing contract in March last year to develop the Sichuan block, hoping that getting in early would allow it to be the biggest beneficiary from the sort of shale boom that has transformed the U.S. energy market.
Much of the $1 billion investment Shell spent this year on China’s upstream business went to Sichuan, Shi Jiangtao, a Shell China spokesperson said in an email.
A former Shell executive said last year that Shell plans to spend at least that much a year exploring China’s shale gas.
The major in August revealed a $2.2 billion charge against its weak U.S shale business and abandoned its 2017 goal to deliver 4 million barrels per day of total production.
CEO Peter Voser said in October it will take a longer time than expected for Shell to reap benefits from its global shale gas projects due to poor short-term results.
– REUTERS
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.