Natural Gas Daily: October 27th, 2020
BP's underlying replacement cost (RC) profit recovered to $86mn in the third quarter, from a $6.68bn loss in the second quarter, the UK major reported. This was achieved despite lower gas prices and refining and marketing margins than the company's assumptions for profitability.
- BP attributed the better than expected result to the absence of major exploration write-offs and a rebound in prices and demand for oil and gas.
- BP has confirmed it will reduce its oil and gas production by 40% by 2030 and increase its investment in renewables. BP is also in the process of restructuring, having announced a 10,000 staff cut in June.
Oil and gas firms are due to drill only 30 exploration wells off Norway in 2020, representing a 14-year low and less than half the amount in 2019, the Norwegian Petroleum Directorate (NPD) said in a report.
A lack of new discoveries today could have serious consequences in the long term, the directorate warned.
- Norway has attracted bids from 33 companies in its latest annual Awards in Predefined Areas (APA) licensing round, with awards due in early 2021.
Portuguese energy group Galp Energia has struck a deal to sell most of its interest in its gas distribution arm to Germany's Allianz Capital Partners (ACP) for €368mn ($435mn), it announced.
- Galp Gas Natural Distribuicao controls nine regional gas distribution firms in Portugal with a combined network spanning over 13,000 km that serves around 1.1mn households.
- Bloomberg reported in March that Galp was looking to divest from the company, having sold a 22.5% stake back in 2016 to Japan's Marubeni and Toho Gas in 2016 for €138mn.
Russia's Gazprom has raised nearly $2.6bn from the placement of perpetual Eurobonds, it announced, adding it would use the funds to refinance its existing debt.
- The company saw net profits almost halve year on year in the second quarter, on lower prices and weaker gas sales in Europe. In Jan-July 2020 vs Jan-July 2019, Gazprom exported 17.9bn m³ less (-17.6%).
Gazprom is eager to improve its cost control, after promising shareholders increased dividends and lower capital expenditure in the coming years.