Swiss commodities giant Vitol Inc. traded 8 million b/d of crude oil and products in 2019, an 8% year/year (y/y) increase, CEO Russell Hardy said Friday, noting that last year “now seems a very long time ago” amid the havoc wrought by 2020 on the global economy.

Hardy said most products traded by Vitol benefited from relatively tight margins in 2019, “enabling us to optimize our performance across the portfolio.”

Traded volumes of crude, gasoil and gasoline rose by 10%, 20% and 13%, respectively, while fuel oil volumes fell 11% ahead of the International Maritime Organization’s restrictions on sulfur content in shipping fuel that took effect Jan. 1, 2020.

Hardy said Vitol expects liquefied natural gas (LNG) to account for a growing share of revenue, noting that delivered volumes rose 35% to 10.5 million metric tons (mmt) in 2019.

The trading house plans to enter into a number of long-term LNG partnerships, Hardy said, “which we believe will...

EQT Corp. has suspended its quarterly dividends, while Basic Energy Services Inc. has cut spending by 60% and begun closing some locations, as the global oil and gas industry defends against forces that were unforeseen only three months ago.

The spread of Covid-19, combined with the continuing oil price war, has brought many energy firms around the world to their knees, after they faced a hammering on the commodity price side during 2019.

U.S. exploration and production (E&P) companies now face a triple threat because of spring bank redeterminations, Tudor, Pickering, Holt & Co. (TPH) analysts said Friday. The decline in the strip for natural gas, West Texas Intermediate (WTI) crude and the pressure on natural gas liquids “are providing risk of a triple whammy for bank decks going into the spring redetermination period,” the TPH team said.

For most small/mid-cap E&Ps, lines of credits from banks are the primary way to access debt...

Earlier this month, when crude futures dropped more than $10/bbl seemingly overnight, it foreshadowed a sharp pullback in activity in the North American onshore; the updated Baker Hughes Co. (BKR) rig count Friday showed a retrenchment every bit as steep and sudden as the collapse in prices.

The United States sent 44 rigs packing during the week ended Friday, with the vast majority -- 40 in total -- oil-directed, according to BKR. Four natural gas-directed rigs also exited on the week, dropping the combined domestic tally to 728, down from 1,006 rigs active in the year-ago period.

Land drilling accounted for most of the declines, dropping by 41 rigs week/week. Two rigs exited from inland waters, along with one departing the Gulf of Mexico. Horizontal drilling fell by 43 rigs overall, with directional drilling down two. The number of vertical rigs saw a net increase of one.

The losses were equally steep for Canada, which also dropped 44 rigs...

Earlier this month, when crude futures dropped more than $10/bbl seemingly overnight, it foreshadowed a sharp pullback in activity in the North American onshore; the updated Baker Hughes Co. (BKR) rig count Friday showed a retrenchment every bit as steep and sudden as the collapse in prices.

The United States sent 44 rigs packing during the week ended Friday, with the vast majority -- 40 in total -- oil-directed, according to BKR. Four natural gas-directed rigs also exited on the week, dropping the combined domestic tally to 728, down from 1,006 rigs active in the year-ago period.

Land drilling accounted for most of the declines, dropping by 41 rigs week/week. Two rigs exited from inland waters, along with one departing the Gulf of Mexico. Horizontal drilling fell by 43 rigs overall, with directional drilling down two. The number of vertical rigs saw a net increase of one.

The losses were equally steep for Canada, which also dropped 44 rigs...

Earlier this month, when crude futures dropped more than $10/bbl seemingly overnight, it foreshadowed a sharp pullback in activity in the North American onshore; the updated Baker Hughes Co. (BKR) rig count Friday showed a retrenchment every bit as steep and sudden as the collapse in prices.

The United States sent 44 rigs packing during the week ended Friday, with the vast majority -- 40 in total -- oil-directed, according to BKR. Four natural gas-directed rigs also exited on the week, dropping the combined domestic tally to 728, down from 1,006 rigs active in the year-ago period.

Land drilling accounted for most of the declines, dropping by 41 rigs week/week. Two rigs exited from inland waters, along with one departing the Gulf of Mexico. Horizontal drilling fell by 43 rigs overall, with directional drilling down two. The number of vertical rigs saw a net increase of one.

The losses were equally steep for Canada, which also dropped 44 rigs...

FERC has denied a request from three environmental groups to rehear a 2017 order authorizing the Mountaineer XPress and Gulf XPress projects, a pair of TransCanada Corp. efforts to increase natural gas pipeline capacity out of the Appalachian Basin by expanding the company’s Columbia Gas Transmission LLC’s system.

The decision comes more than a year after the Federal Energy Regulatory Commission authorized partial service to begin on Columbia Gas Transmission LLC’s (TCO) Mountaineer Xpress project [CP16-357]. Mountaineer XPress was designed to add 164.5 miles of 36-inch diameter pipe and the six miles of 24-inch line, expanding the TCO system by adding 2.7 Bcf/d.

The Gulf XPress project was to add seven new compressor stations -- three in Kentucky, two in Tennessee and two in Mississippi -- to expand the capacity of Columbia Gulf Transmission LLC's system [CP16-361]. The project would also include upgrades to an existing compressor in Carter County, KY, and...

Oil and natural gas companies across the Lower 48 and abroad, themselves facing uncertainty due to an ongoing price war, have launched major relief efforts in their communities amid the coronavirus pandemic.

In addition to utilities that have announced plans to halt disconnects and waive fees for customers, Duke Energy is taking extra care of its employees. The company contributed $100,000 to its Relief4Employees program, which gives one-time grants to employees experiencing financial hardship. Duke also is offering five additional personal days for employees whose dependent care is disrupted. Some employees also may be eligible for a $1,500 stipend to assist with unplanned expenses like emergency childcare.

“This is an unprecedented crisis that requires an unprecedented response,” said Duke CEO Lynn Good.

Charlotte, NC-based Duke also is donating $1.3 million to health and human services, as well as hunger relief efforts in the seven states...

A federal judge has reopened the question of whether the Dakota Access Pipeline (DAPL) in North Dakota, which began flowing crude from North Dakota’s Bakken Shale in 2017, will be allowed to continue operating.

More capital spending reductions are making the news in the energy sector, and the coronavirus is hitting closer to home, as Murphy Oil Corp.’s CEO announced he is taking a temporary medical leave on a presumptive diagnosis.

Murphy CEO Roger W. Jenkins has, pending test results, a presumptive diagnosis, the El Dorado, AR-based independent said. “He is expected to completely recover,” but in the interim, CFO David R. Looney has taken the helm as president and CEO.

Meanwhile, in response to the downturn in the energy markets, more exploration and production (E&P) companies and oilfield services (OFS) operators have reversed course on their 2020 capital expenditures (capex) and activity plans.

Appalachia-focused Montage Resources Corp., a natural gas heavy, revised full-year capex lower by 23% to $145-165 million, the midpoint of previous guidance. However, production targets remain at 570-590 MMcf/d, primarily because of outperformance in...

The Colorado Oil and Gas Conservation Commission (COGCC) on Wednesday reconsidered plans to hold a virtual meeting to discuss changes to Senate Bill (SB) 19-181, opting now to temporarily pause the rulemaking schedule on coronavirus concerns.

The move to halt the rulemaking comes as stricter rules have been put in place around the nation in an effort to stop the spread of Covid-19. The efforts have created an inability to conduct face-to-face meetings, which are a critical component to successful rulemaking, according to the COGCC.

“We evaluated whether we needed to push back the rulemaking proceedings at this point, to ensure that all parties have actual and, importantly, perceived due process,” said COGCC Director Jeff Robbins at a hearing held remotely on Wednesday.

“Our recommendation is to pause rulemaking because we do not want to undertake such an important piece of business -- rulemaking -- ‘virtually.’ This decision comes after...

Oil and natural gas activity in Texas, southern New Mexico and northern Louisiana fell off a cliff in the first three months of the year, unsurprising news from the Federal Reserve Bank of Dallas.

The Dallas Fed, as it is known, issued its quarterly energy survey on Wednesday. The Eleventh Federal Reserve District every three months queries oil and natural gas executives in the biggest overall producing area of the country about business conditions. The companies surveyed are headquartered in the district, but many also have national and global operations.

“This quarter’s survey results were overwhelmingly negative, as recent events have weighed heavily on the industry,” said senior research economist Michael Plante. “Relative to last quarter, business activity levels plunged, firms cut capital spending and outlooks became extremely pessimistic.”

The business activity index, the Dallas Fed’s broadest measure, measured data from March 11-19,...

Canadian oil and gas companies continue to lop off more from 2020 capital budgets, with Suncor Energy the latest to announce its plans on weathering the Covid-19 pandemic and poor commodity prices.

Suncor joins Precision Drilling, which has indicated it would halve its 2020 capital expenditures (capex) and cut CEO and board compensation salaries by 20%. Suncor, a top oilsands developer, cut projected 2020 capex by 26% to C$3.9-4.5 billion ($2.9-3.4 billion) from its original plan to spend C$5.4-6 billion ($4-4.5 billion).

The two reductions deepened the sector’s total estimated pruning to about C$6 billion ($4.5 billion), or 16% off the 2020 spending of C$37 billion ($28 billion) predicted in January by the Canadian Association of Petroleum Producers.

The Suncor budget cut is projected to have little immediate effect on production. The firm forecasts total 2020 output of 740,000-780,000 b/d. The firm’s previous 2020 guidance for investors put...

The North Dakota Industrial Commission (IC) on Tuesday adopted remedies that may protect oil and gas producers during an expected spike in idle wells from the global economic slowdown.

Following a review, the IC headed by Gov. Doug Burgum directed the Department of Mineral Resources (DMR) to establish one-year, renewable waivers for new wells that under normal conditions are required to be operated or abandoned within one year.

Waivers would be invalid after the price of West Texas Intermediate (WTI) oil is at $50/bbl or more for 90 days, according to the order.

DMR Director Lynn Helms last week said the IC was likely to take action with the price of Bakken oil dropping. “Inactive wells and abandoned ones are a huge concern long-term for the commission,” he said.

The well waiver guidelines for uncompleted wells allow the operators to apply for not-completed status, along with similar guidelines for inactive and temporarily abandoned...

Diversified Gas & Oil plc said this week that it has extended its asset retirement agreement with Ohio regulators and agreed to plug more wells each year.

The company is the Appalachian Basin’s largest operator of conventional wells, with 60,000 between its northern and southern divisions spread across six states. Diversified produced 84,800 boe/d last year, of which 70,000 boe/d was produced by legacy assets. Its well retirement obligations in Ohio have been extended through Dec. 31, 2029, under the latest agreement.

The terms remain largely unchanged, but Diversified has agreed to plug 20 wells/year for the duration of its pact with the state, a slight increase from the 18 it was required to retire annually under the previous agreement. Diversified also is to post a surety bond of $650,000 in the state. 

The company operates 7,100 wells in Ohio and plugged the required 18 wells in the state last year.

There are thought to be...

The oilfield services (OFS) sector was under pressure before the oil price war was launched and Covid-19 became a pandemic, but the future of many companies appears to hang on a thin thread, battered by the outbreak and plunging oil market. One analyst predicted up to one million jobs could be lost, mostly in the onshore sector.

Bellwether Schlumberger Ltd. on Tuesday cut capital spending by 30% from 2019 levels, another brick in the wall as the bellwether of the global OFS sector adjusts to the new normal. Halliburton Co., the No. 1 hydraulic fracturing (fracking) operator in North America, also signaled plans to sharply cut capex and lay off personnel. Earlier this month it furloughed 3,500 people at its Houston campus.

“The industry is facing an unprecedented dual impact on the demand and supply side that none of us have witnessed over our professional lifetimes,” Halliburton CFO Lance Loeffler said Tuesday during a webcast.

Houston-based independent Occidental Petroleum Corp. (Oxy) said Tuesday it has named Magnolia Oil and Gas Corp. CEO Stephen Chazen as chairman in an apparent concession to activist shareholder Carl Icahn.

Chazen served as CEO from 2011-2016, and as a director from 2010-2017. In 2018, he founded Magnolia, where he will continue to serve as CEO.

Chazen is an ally of Icahn, a forceful critic of Oxy CEO Vicki Hollub and of Oxy’s $57 billion acquisition of Anadarko Petroleum Corp. last year.

The current macro environment “is among the most difficult I have seen in my career,” Chazen said. “I am confident that the board and this management team, led by Vicki Hollub, have the operational experience to help guide Occidental through the challenges ahead, and my goal is to help them succeed.”

He said his “primary focus and occupation remains…serving in the role of CEO of Magnolia,” and that he would not serve in a traditional capacity as an...

Despite growing domestic gas production from its Vaca Muerta formation and plans to develop large-scale liquefied natural gas (LNG) facilities, Argentina has ordered 11 LNG cargoes for the upcoming Southern Cone winter as prices for the super-chilled fuel continue to suffer from the demand shock of the coronavirus.

State energy firm Integración Energética Argentina (Ieasa) said prices fetched for the requested shipments “were the lowest recorded in the history of the company” and averaged around $3.00/MMBtu.

“The deacceleration of the Chinese economy meant the Asian giant had to reject LNG cargoes which led to oversupply in the market,” according to an Ieasa statement.

The first shipment is expected for May, the start of the winter.

“First takeaway is a positive one for Argentina, as it has been able to cover winter demand at an average price close to US$3.00/MMBtu,” Wood Mackenzie’s Ignacio Rooney told NGI. “This price is lower if you...

Chevron Corp. led the way by oil and natural gas producers on Tuesday in announcing huge cuts to capital spending this year, with Marcellus Shale operator Antero Resources Inc. and Permian Basin-focused Laredo Petroleum Inc. also pulling back as the North American energy industry attempts to regroup amid a pandemic and an oil price war.

The announced reductions by the exploration and production (E&P) sector, which include Calgary’s Husky Energy among several Canadian operators, mirror the severe capital expenditure (capex) cuts to date by the oilfield services sector, which on Tuesday added Schlumberger Ltd., FTS International Inc. (FTSI) and Precision Drilling Corp.

San Ramon, CA-based Chevron is reducing capex by 20% across the portfolio, with most of the upstream reductions in the Permian. The revamped plan now puts Permian output by year’s end at 125,000 boe/d, or 20% below initial guidance.

The reduction to $16 billion in capex...

Energy Transfer LP (ET) said Tuesday Pennsylvania has granted a waiver allowing it to conduct limited work on the Mariner East (ME) pipeline project during broader economic restrictions imposed by Gov. Tom Wolf to mitigate the spread of coronavirus.

Wolf ordered all “non-life-sustaining” businesses to shut down physical operations last week. While oil and gas extraction, transportation and distribution were allowed to continue, general construction activity on the pipeline project was forced to stop, along with a wide array of other building projects.

ET subsidiary Sunoco Pipeline LP is allowed to proceed with efforts to monitor and maintain rights-of-way and works sites for the ME project, spokesperson Lisa Coleman said. The company may also resume stabilization and move equipment at work sites.

“We are in the process of resuming these activities while adhering to the protocols outlined in the order to ensure the continued safety of our...

High risk of Covid-19 infection in crowded places has led Husky Energy to suspend construction of a C$2.2 billion ($1.6 billion) expansion at its White Rose ocean oil production site, 350 kilometers offshore of Newfoundland.

Husky called the time-out after the Canada-Newfoundland Offshore Petroleum Board (CNOPB) issued an order for industry to pare crews down to essential personnel for the duration of the pandemic.

About 600 construction workers were packed into the remote site on the Grand Banks of Newfoundland. The next scheduled stage in the West White Rose Project called for the offshore labor force to grow to 1,400 in April.

The CNOPB order followed a warning by Trades NL, a coalition of 16 Newfoundland construction unions, that the main defense against the coronavirus, social distancing, is impractical when offshore projects concentrate big crews in small spaces.

With the pandemic still in early stages in Canada, Husky did not announce...