How significant is Pakistan’s oil discovery?

Politics, geopolitics and conflicts

– North Korea has used its state news agency to broadcast a message that it is enriching uranium for nuclear weapons. The news agency published a photo of Kim Jong Un inside what is believed to be a uranium enrichment facility attached to the Nuclear Weapons Institute. The agency quoted Kim as saying the facility was “dynamically producing nuclear materials” and would now seek to “exponentially increase nuclear weapons for self-defense.”

– Nothing has changed regarding the disputed results of the presidential elections in Venezuela. Maduro continues to remain largely unchallenged, and the window of opportunity to remove him is narrowing. Once it’s inaugurated in January, it’s game over. The opposition doesn’t seem to have a playbook here, and Maduro is a tough target who is essentially a drug cartel that the opposition will find difficult to navigate. Indeed, the opposition presidential candidate is now being forced into political asylum in Spain after an arrest warrant was issued for Maduro. Nothing can happen for the opposition unless they can poach the interior and defense forces to their cause. So far, there is no indication that they can.

– In Libya, there is still no movement to lift the oil embargo that began when the interim prime minister (Dbeibah, head of the Tripoli-based government) made a strangely unsuccessful attempt to oust the head of the central bank, which brought rival Benghazi -based…

Politics, geopolitics and conflicts

– North Korea used its state news agency to broadcast a message that it is enriching uranium for nuclear weapons. The news agency published a photo of Kim Jong Un inside what is believed to be a uranium enrichment facility attached to the Nuclear Weapons Institute. The agency quoted Kim as saying the facility was “dynamically producing nuclear materials” and would now seek to “exponentially increase nuclear weapons for self-defense.”

– Nothing has changed regarding the disputed results of the presidential elections in Venezuela. Maduro continues to remain largely unchallenged, and the window of opportunity to remove him is narrowing. Once it’s inaugurated in January, it’s game over. The opposition doesn’t seem to have a playbook here, and Maduro is a tough target who is essentially a drug cartel that the opposition will find difficult to navigate. Indeed, the opposition presidential candidate is now being forced into political asylum in Spain after an arrest warrant was issued for Maduro. Nothing can happen for the opposition unless they can poach the interior and defense forces to their cause. So far, there is no indication that they can.

– In Libya, there is still no movement to lift the oil embargo that began when the interim prime minister (Dbeibah, head of the Tripoli-based government) made a strangely unsuccessful attempt to oust the head of the central bank, which brought in rival Benghazi the Haftar clan based in action at the central bank (where oil revenues are held) and by blocking production and exports. There may be some indication based on data loading that flows are now improving; however, the reality is that they will only flow if Haftar allows them, intermittently, but won’t unleash the oil until he has enough leverage to make a bigger move, with all eyes on what happens with the central bank blockade going forward.

Discovery and development

– A significant discovery of oil and gas reserves has been made in Pakistan’s territorial waters, potentially the fourth largest in the world in terms of reserves. This hydrocarbon discovery, confirmed after a three-year survey carried out in partnership with an allied nation, could drastically change the economic outlook of Pakistan, which is currently facing serious challenges. Exploration proposals are under review, although actual extraction may take years. The discovery could help reduce Pakistan’s dependence on oil or LNG imports if reserves are as large and extractable as anticipated, although caution remains due to the high costs and time required for exploration and drilling.

– Talos Energy Inc. made a significant oil and gas discovery at its Ewing Bank 953 (EW 953) well in the Gulf of Mexico, encountering approximately 127 feet of net pay at a depth of 19,000 feet. The discovery is expected to produce 15–25 Mboe, with an initial production rate of 8,000–10,000 bpd anticipated by mid-2026. Talos holds a 33.3% working interest, with Walter Oil & Gas Corp. as an operator.

-Equinor has made a significant gas and oil discovery in the Haltenbanken West unit prospect in the Norwegian Sea, as announced by the Norwegian Offshore Directorate. The discovery, drilled near the Lavrans discovery in the Kristin field, is estimated to hold between 2 and 4 million standard cubic meters of recoverable oil equivalent, which equates to approximately 25 million barrels. Equinor holds a 54.82% stake in the project, with other partners including Petoro (22.52%), Vår Energi (16.66%) and TotalEnergies (6%).

– CNOOC has made a significant discovery with its latest ultra-deepwater gas discovery in the Pearl River Estuary Basin. The Liwan 4-1 well, drilled to nearly 4,400 meters, produced 430,000 cubic meters of natural gas per day, marking China’s first major deep-sea carbonate rock exploration success. This discovery not only reveals the potential of carbonate reservoirs, but also complements the existing facilities at the nearby Liwan 3-1 gas field, facilitating efficient development. CNOOC’s recent activities also include notable discoveries in the South China Sea and Bohai Gulf.

– Bolivia’s state-owned YPFB is stepping up efforts to counter a significant drop in oil and gas production by advancing 56 exploration projects. Production has fallen from a peak of 18.6 million barrels of oil and 768.6 Bcf of gas in 2014 to just 8.6 million barrels and 463.4 Bcf in 2023. Bolivian President Luis Arce highlighted past failures in maintaining exploration efforts, which have led to the depletion of key deposits. such as Margarita and Incahuasi. Since 2021, YPFB’s renewed exploration program has yielded 18 positive results, including the promising Mayaya Centro-X1 IE discovery with an estimated 1.7 Tcf of gas.

Deals, mergers and acquisitions

– Diamondback Energy (FANG) completed its $26 billion merger with Endeavor Energy Resources. The merger enhances Diamondback’s high-grade inventory in the Permian. The integration of Endeavor’s assets and employees is expected to support Diamondback’s focus on efficient, low-cost operations and position it for long-term growth in unconventional oil and gas production in West Texas.

– Offshore drilling contractor Seadrill is looking to acquire distressed assets or merge with partners to grow its fleet, according to its CEO. After two debt restructurings, Seadrill is now under the control of its creditors. But it sees consolidation opportunities in the offshore drilling market, where rates have risen after 2021. Its CEO says Seadrill has enough cash for strategic acquisitions or mergers, even if it means being the junior partner. Major shareholders of Seadrill include investment funds Bybrook Capital, Canyon Capital and Elliott Management.

– DNO expanded its footprint on the Norwegian continental shelf by acquiring stakes in five oil and gas fields from Vår Energi, including the operation of the Marulk field. This transaction adds more than 8 Mbp in reserves and resources, with production expected to increase from 3,000 boed to more than 5,000 boed by 2026 as a result of the development of Verdande. All fields are tied to Equinor’s Norne FPSO, with an extended life to 2036. DNO’s exploration efforts continue, including ongoing drilling projects in the North Sea and increased production from new assets in the UK and Norway .

– Pembina Gas Infrastructure (PGI), a joint venture between Pembina Pipeline and KKR, acquires Veren Inc. oil batteries. in the Gold Creek and Karr areas of Alberta for $291 million. The assets include natural gas handling capacity of 320 MMcf/d and liquids handling of 53,000 bpd, which will tie into PGI’s Patterson Creek gas plant and Peace Pipeline system. Veren will retain battery operatorship and take over additional operations under a 15-year take-or-pay agreement. This deal strengthens PGI’s strategic partnership with Veren and aligns with both companies’ growth plans in the Montney and Duvernay regions.

– APA Corp (APA) agreed to sell non-core drilling assets in the Permian Basin for $950 million in order to reduce its $6.7 billion debt pile. The move is part of a broader industry trend toward consolidating assets and reducing debt, following similar deals by companies such as Occidental Petroleum. APA plans to use the proceeds primarily to pay down $2 billion of debt over the next three years, with the sale expected to close in Q4 2024. The divested properties produce 21,000 bpd, contributing to APA’s estimated Q4 production of 307,000 bpd.

– Exxon Mobil has withdrawn from the race to acquire a 40% stake in Galp Energia’s large offshore oil discovery in Namibia, known as Mopane, despite initial interest from more than 12 major oil companies, including Shell and Petrobras. Galp’s stake in the discovery, estimated to hold more than 10 billion barrels of oil and gas equivalent, could be valued at more than $10 billion. Although the reasons for Exxon’s withdrawal remain unclear, other companies continue to engage in the bidding process. The sale is part of a wider trend of offshore discoveries in Namibia that could position the country as a major oil producer.