All posts tagged feature

How Will You Ride the Slide in 2023? The Case of the Global Service Companies!

By Gerard Kreeft

A service company by its very definition is dependent on the fickleness and whims of the marketplace, but more specifically the oil and gas producers.

For starters, OPEC’s predicted oil production has varying scenarios. The cartel’s long-term forecast is now predicting a global production of 110Million barrels per day up to 2045(see below).

This optimistic prediction is at odds with Wood Mackenzie’s AET-2(Accelerated Energy Transition)

scenario which states that oil and gas demand in 2050 will be 70% lower than today. From

2023 onward oil demand drops with year-on-year fall of around 2Million barrels per day(BPD). Total

oil demand by 2050 is down to 35MillionBPD.

The current blip on the radar screen could well be caused by the reprieve that oil companies and hence their service companies are getting from higher oil prices that started with the Ukraine conflict. Deepwater is the fastest growing upstream oil and gas resource, according to Woodmac’s interpretation. Production in that terrain is expected to hit 10.4MillionBOEPD in 2022 and will reach 17MillionBOEPD by the end of the decade. Even if oil production is on a long term decline the deepwater exploration and development will continue to be the heartbeat driving the industry.

Yet in spite of higher needs for oil, the share price of the three major service companies, has lagged behind the Dow Industrial index.


The company has rebranded itself in two pillars: the traditional oilfield services and equipment (OFSE) and Industry and Energy Technology (IET), offering new energy services for the energy transition. BH’s investment programme is focused on revenue growth, margin enhancement, and improving ROIC ((return on invested capital). In 2022 total revenue of $20.5Billion are anticipated.

Up to 2030 IET is seen as the real growth engine, doubling revenues from $8.5Billion to $17Billion. Key drivers are LNG, CCUS (Carbon Capture, Utilization, and Storage) and H2 services and technology.


The company is involved in every stage of the oilfield life cycle: exploration, well construction, completions, production and abandonment. Key strategic priorities are profitable international growth, maximizing value in North America and automation of the value chain.

Halliburton is also dedicated to helping customers decarbonize legacy production bases. The company is pledged to reducing Scope 1 & 2 emissions by 40 percent from its baseline of 2018.

Revenue in 2021 was $15Billion.

The company’s energy transition solutions include CCS, CO2 storage and geothermal services.


Schlumberger is of the view that the current oil industry revival is driven by the underinvestment of the past. E&P capital is poised to accelerate E&P capital across all geographic and operating boundaries to drive new production capacity increases.  Digital and decarbonization are gaining momentum.

FID (Final Investment Decision) for the period 2022-2025, in Schlumberger’ estimation, will be $397Billion as opposed to $267Billion in the period 2016-2019. This is an increase of 49%, which is large by any measure.  Offshore represents five times the revenue potential of onshore.

The company indicates that it is reducing emissions and environmental impact with practical, quantifiably proven solutions through partnership across the industry. CCS is one of these measures.

Financial Overview & Summary

Dow Jones Industrial Index in the period January 2018- December 2022 rose 31%: increasing from 25,295 to 33,147. Yet in that same time frame the three major service companies have seen their share price tumble, in spite of a revival in the oil and gas market.

BH has seen its share price fall the least: $29 December 2022, and $34 January 2018, a drop of 13%.

Halliburton’s share price January 2018 was $52 and $39 December 2022, a drop of 25%.

Schlumberger’s share price January 2018 was $74, and December 2022 was $53, a drop of 28%.

By all indications the major service companies have fallen out of favour with major investors. Increased oil and gas activity is no longer a guarantee that this will increase the value of a company’s share price.

Yes, all three service companies are pledged to further decarbonizing their asset base as well as further digitalization. Yet in the final analysis the service sector is dependent on the oil majors who determine the pace and strategy of the sector. As long as the oil majors continue to see their dominant operations within the scope of the E&P world the service sector’s future has been determined.

Gerard Kreeft, BA (Calvin University, Grand Rapids, USA) and MA (Carleton University, Ottawa, Canada), Energy Transition Adviser, was founder and owner of EnergyWise.  He has managed and implemented energy conferences, seminars and university master classes in Alaska, Angola, Brazil, Canada, India, Libya, Kazakhstan, Russia and throughout Europe.  Kreeft has Dutch and Canadian citizenship and resides in the Netherlands.  He writes on a regular basis for Africa Oil + Gas Report, and is a guest contributor to IEEFA (Institute for Energy Economics and Financial Analysis). His book ‘The 10 Commandments of the Energy Transition ‘is on sale at


ENI Finalises Its Partial Sale in Algeria-Italy Gas Pipelines to Snam

Italian major ENI has announced the closing of Snam’s acquisition of a 49.9% of the equity interest directly and indirectly held by ENI in the companies operating two groups of international gas pipelines connecting Algeria to Italy.

Snam S.p.A. is an Italian energy infrastructure company.

The scope of the transaction includes the onshore gas pipelines running from the Algeria and Tunisia borders to the Tunisian coast (TTPC), and the offshore gas pipelines connecting the Tunisian coast to Italy (TMPC) [1].

These ownership interests were transferred by ENI to a new company (SeaCorridor S.r.l.), of which Snam has acquired 49.9% of the share capital, while the remaining 50.1% continues to be held by ENI. ENI and Snam will exercise joint control of SeaCorridor under joint governance arrangements.

Snam paid ENI a total consideration of about 405 million euros in the transaction [2].

“The transaction leverages ENI’s and Snam’s respective areas of expertise in gas transport on a strategic route for the security of Italy’s natural gas supply”, ENI says in a statement, “enabling potential development initiatives within the hydrogen value chain also thanks to the natural resources North Africa has to offer. The North Africa – Europe link is a key element of progressive decarbonisation at the international level in support of the energy transition.

“The transaction has obtained the authorisations envisaged under antitrust legislation and so-called golden power legislation, consent from the Tunisian government as well as the approval of the shareholders and corporate bodies of the various target companies”.



BWE Spuds the ‘First Hibiscus’ in Gabon

BW Energy has spud the first production well on the Hibiscus / Ruche Phase 1 development in the Dussafu Block offshore Gabon. Drilling operations commenced on schedule in the first week of January and in line with the target of producing first oil in March 2023.

The Borr Norve jackup arrived on location in late December 2022 and immediately started preparations for the drilling campaign. The first production well, DHIBM-3H, targets the Gamba sandstone reservoir on the Hibiscus field and is expected to take just over two months to drill and complete. Installation of flexible pipelines and risers, completing the 20-kilometre connection between the BW MaBoMo production facility and the FPSO BW Adolo, was also finalised last week.

“We are on track for first oil towards the end of the first quarter. This will be the first step of many on a path for successive production growth as we complete the drilling Hibiscus / Ruche Phase 1 programme and asset upgrades through 2023 and into early 2024,” said Carl Krogh Arnet, the CEO of BW Energy.

The initial Hibiscus / Ruche Phase 1 drilling campaign targets the Hibiscus and Ruche fields which are expected to add approximately 30,000 barrels per day of total oil production when all wells are completed in early 2024.

Meanwhile the new gas lift compressor to support production for the six existing Tortue wells was lifted onboard the BW Adolo in December 2022. Installation work is ongoing. Commissioning and start-up of the compressor is expected to commence immediately after first oil from Hibiscus / Ruche which has priority during the current high-activity period onboard the FPSO.


Local Content Should Not Reduce Competitiveness or Foster Cost Increases

By Paulino Jerónimo

LUANDA, ANGOLA-October 20 is a date of particular relevance for the ANPG, as it was on this day that, in 2020, the Angolan National Concessionaire, through the publication of Presidential Decree 271/20 , was given specific responsibilities for the operationalization of local content in the Oil& Gas Industry.

Top on the assignment was the development and publication of annual lists of goods and services under exclusivity and preference regimes, the registration and certification of Angolan suppliers, the monitoring and inspection of the contracting processes in the sector, the consolidation of the of National Local Content and monitoring the implementation of the Human Resources Development Plan together with MIREMPET.

Here, what results do we have to present in this matter?

The ANPG started by meeting with the government institutions involved in the process – the Ministry of Mineral Resources, Oil and Gas (MIREMPET) and the Ministry of Economy and Planning (MEP) – and with the associations representing suppliers in Angola, namely with the Association of Contracted Companies of the Oil Industry of Angola (AECIPA), the Association of Indigenous Companies for the Oil Industry of Angola (ASSEA), the Association of Exploration and Production Companies of Angola (ACEPA) and the Competition Regulatory Authority (ARC).


The work carried out together resulted, on October 18, 2021, in the publication of the lists of goods and services in the exclusivity and preference regimes on the ANPG website and in Jornal de Angola.

On the same day, the registration and certification process for suppliers came into force through the launch of the platform for this purpose on the ANPG website.

One year after its entry into force, we have 786 companies registered on the ANPG platform and around 322 companies certified in various sectors of the national economy. It’s already working!

We have also set up and operated the ANPG’s Local Content Centre with the aim of guaranteeing the continuity of the operationalization activities of the new local content regime and of coordinating all activities for the creation and implementation of the future Local Content Office. of the National Concessionaire.

The new local content framework must be competitive and must develop the necessary quality among companies. Local content should not reduce competitiveness or increase costs in the industry. This would send the wrong message to investors and could impact the overall objective of ensuring sustainable production.
Our approach was to create three contracting regimes: exclusivity, preference and free competition. The least complex work to be done in the industry was reserved for exclusivity because that work can be carried out by local companies, and they are already doing it.
For the preferential regime, if the service or goods are provided in the country, preference shall be given to the local provider if the cost is within a certain range. If local companies are much more expensive than international ones, it is possible to acquire the goods or services from international companies. The idea here is to generate joint ventures in which international companies bring knowledge and investment to local partners. Our expectation is to update these goods and services lists annually if we need to.
Our expectation also is that this process generates real local companies that can do more complex work, and then we can migrate goods and services to the exclusivity regime.
Sometimes there is a misinterpretation of our procedures. Local companies need to first register on the ANPG website, then present the required documentation. The ANPG and representatives of operators will then visit these companies’ installations to check whether they are up to the standards we require before providing the approval and certification to enable them work in the industry.

In the meantime, with the express support of the Ministry of Mineral Resources, Oil and Gas, we held two workshops in Angola on local content, in which the most relevant national representatives of the oil industry were present and we presented our strategy for operationalizing the theme.

In other words, in these two years we followed up on the functions assigned to us and worked to present results. Above all, to create conditions that allow national companies and entrepreneurs to be one of the most active voices in the development of the Angolan oil sector.

And it is in this way that we promise to continue, supporting, stimulating, contributing so that we all work together more and better for the economic and social development of our country!

Count on us. We count on the commitment of all of you!

Paulino Jerónimo

Chairman of the Board of Directors of the National Agency for Petroleum, Gas and Biofuels

Algeria Reduces Import of Petroleum Products by 70%

Algeria imported 254,741 Tons of Petroleum Products in 2021, compared with 858,939 Tons in 2020, a significant drop of 70%.

“This decrease is explained by the improvement in the local production of gasoline and diesel”, according to Sonatrach, the state hydrocarbon company. This improvement “led to a total stoppage of land fuel imports”, Sonatrach adds, in its latest report.

“The completion of the refinery rehabilitation programme and the improvement in production optimization, made it possible in 2021 to meet all of the demand for gasoline and diesel and stop importing them”, Sonatrach enthuses in its upbeat report.

Sonatrach says it completed the upgrade of its key refineries: Skikda, Arzew and Algiers; the revamp has taken the course of the last 10 years. But the major investment in refinery capacity increase in 2021 was completion work on the new Hassi Messaoud refinery-collocated with the old Hassi Messaoud refinery.

There was also a 7% drop in overall export of refined products, from 14.6Million Tonnes to 13.6Million Tonnes, an indication that Algerians consumed more petroleum products in country than they exported.

Gas Flare Programme: 139 Applicants Make It to RFQ Phase

The Nigerian Upstream Regulatory Commission (NUPRC) has rated 139 applicants as “deemed successful and awarded the Qualified Applicant status”, for the Request For Qualification (RFQ) Phase of the Nigerian Gas Flare Commercialisation Programme (NGFCP) 2022

This is less than 50% of the Three Hundred (300) companies who registered their interest to revalidate their prequalification status and submit Statement of Qualification (SOQ) as existing bidders and new participants, respectively.

The Commission says that in consideration of Section 105 (2) of the PIA and similar provisions enabling the Commission in that respect, it “hereby publishes the list of Qualified Applicants who will proceed to the Request for Proposal (RFP) phase of the NGFCP 2022.”

The 139 “Qualified Applicants” will now follow through with the subsequent stages of the Programme towards becoming a Permit Holder/Flare Gas Buyer in line with the applicable statutes.

47 gas flare sites are on offer with a total potential output of about 250Milion standard cubic feet of gas per day guaranteed for five years. 14 of these sites can deliver between 0.5 to 2Million standard cubic feet per day (MMscf/d); 19 sites can do 2.1 to 5MMscf/d; nine (9) can produce between 5.1 and 10MMscf/d and five flare sites can produce over 10MMscf/d.

25 (or 53%) of the flare sites are located on land; eight (8) in swamp; 13 in shallow water and one in deepwater.

The NGFCP 2022 seeks small/mid-scale modular technologies and its unique features includes ease of deployment, scalability, mobility, and off-theshelf availability including: • Mini/mid-scale LNG, • Modular LPG facility, • modular methanol/ammonia plant, • Gas-to-liquids facility, • Virtual pipeline solutions. The proposed solution(s) must cater for the full stream of the flare gas composition

In the next phase of the process, which is Request for Proposal (RFP) phase gas composition will be a part of the flare dataset which will be made available in the data room. Typical flare gas composition shows methane content of 70-90% which makes the sites amenable to mini-LNG deployments NUPRC officials assure. Many of the flare sites are not necessarily connected to pipeline infrastructure, but basic (financial and technical) requirements are provided in the Request for Qualification (RFQ) and detailed information will be enumerated in the RFP when issued, regulators have assured.

The NUPRC says there are no base formula for license fees rather there are fixed fees which are categorized based on range of volumes.

Pricing is always a key issue in gas offtake. Questions have been raised about whether any additional flare gas produced by the field above the licensed quantity may be priced at Henry Hub. To this, the NUPRC has responded: “If available, additional flare gas offtake by Flare Gas Buyer (FGB) over and above the contracted flare volume will be priced at the bid price offered by the FGB as contained in the Gas Sales Agreement (GSA)”.

The NUPRC promises it would “implement a streamlined regulatory licensing and permitting processes to facilitate project development”. It promised that Flare is made available under the NGFCP to a Flare Gas Buyer on an “As is Where is” basis. “The Commission shall exercise best endeavor to ensure that the forecasted quantity is made available by the producers”.

Any carbon credit accruable, the NUPRC explains, will be managed in line with the established protocol on carbon credit.

All Qualified Applicants shall receive further communications via their respective contact addresses and the NGFCP portal ( accordingly.


Italy Wants to Import Electricity from Egypt

Italy has proposed a $2.8Billion electrical interconnection project across the Mediterranean with Egypt

The Italians submitted a proposal to the Egyptian Electricity Transmission Company to work on a joint electricity interconnection project between the two countries with a capacity of between 2,500MW and 3,000MW.

The Europeans have reportedly proposed signing an MoU to begin conducting a feasibility study for the project, the costs of which the Italian side would cover. The Italian proposal also commits the country to securing funding from Italian banks and European financing agencies for the project, were it to go ahead.

Egypt has built a large surplus of electricity generation capacity over the past few years — and Europe is looking for energy suppliers.

Italy’s proposal comes as Europe faces an unprecedented energy crisis as a result of Russian fossil fuels. Egypt has already been preparing to link its electricity grids with Greece and Cyprus through a subsea cable as part of the $4Billion EuroAfrica Interconnector project since 2018, and May 2025 is the on-stream date for the $1.8Billion 3,000MW Egypt-Saudi electricity interconnection. The Egyptian grid is currently linked with Jordan, Palestine, Libya, and most recently Sudan.

Moza Bid Round: China Gets Five Out of Six Awarded Blocks

China´s state owned behemoth, CNOOC (China National Offshore Oil Corporation), has been awarded exploration rights to five out of the six hydrocarbon blocks offered in Mozambique’s sixth licencing round.

ENI, the aggressive Italian major, was awarded one block.

No bids were made for ten of the sixteen offshore blocks which were offered in the round, launched in November 2021.

Bidders even ignored the two blocks in the Rovuma Basin, off the coast of the northern province of Cabo Delgado, which are adjacent to Areas 1 & 4, known to host over 100Trillion cubic feet of gas (proven).

Mozambique’s National Petroleum Institute (INP), the country’s upstream hydrocarbon regulator, is superintending the sale.

Three of the blocks granted to CNOOC (A6-R, A6-E and A6-G) are all in Angoche Basin, in the region of Angoche, off the coast of Nampula province.

The other two (S6-A and S6-B) are in the Save region, off the coast of Inhambane, and near the mouth of the river Save.

The sixth block (A6-C), awarded to ENI, is also in the Angoche region.

INP says that the work programmes proposed by CNOOC and ENI for the first period of exploration will allow investments of around $370Million, including the drilling of at least four wells.


Nigeria Wants to Know Who Own the Companies That Produce Her Oil

By Sully Manope, in Abuja

Industry regulator issues a no-holds- barred directive on Beneficial Ownership Register

The Nigerian Upstream Petroleum Regulatory Commission NUPRC has issued a requirement to “all entities that apply for or hold a participating interest in an exploration or production oil and gas license, lease or contract (“relevant persons”) to provide information of their owners, including the identity(ies) of their beneficial owner(s), the level of ownership and details about how that ownership or control is exerted”.

With this announcement, the regulator, as empowered by the Petroleum Industry Act (PIA), has waded into the Beneficial Ownership issue, taking the initiative from the Nigerian Extractive Industry Transparency Initiative (NEITI).

The Transparency watchdog had, in its last report (2020), lamented that companies were not responding to its call to them to provide the relevant information.

NEITI noted that it had designed a Beneficial Ownership Data template to collect information from companies. Copies of the template were sent to all the covered companies and only 32 companies provided all the information required in the templates. “11 companies did not provide any information on beneficial ownership while 26 did not provide complete information, most especially the owners (natural persons) of the companies”, NEITI says in that report, which is now two years outdated. “Most of the companies that submitted BO information provided the required attestation by a senior management officer or senior legal counsel of the company as to the validity of the information provided”.

The NUPRC declared in an end of year statement: ”all relevant persons are hereby required to provide the information of persons with significant control over them”.

The regulator describes a “person with significant control” as one who:

    • directly or indirectly holding at least 5% of the shares or interest in a relevant person;
    • directly or indirectly holding at least 5% of the voting rights in a relevant person;
    • directly or indirectly holding the right to appoint or remove a majority of the directors or partners in a relevant person;
    • otherwise having the right to exercise or actually exercising significant influence or control over a relevant person; or
    • having the right to exercise, or actually exercising significant influence or control over the activities of a trust or firm, whether or not it is a legal entity, but would itself satisfy any of the first four conditions above if it were an individual.

NUPRC also says that the information shall be provided using the BENEFICIAL OWNERSHIP DECLARATION FORM

The upstream regulator says: “All current holders of participating interest in an exploration or production oil and gas license, lease or contract are hereby required to fill the BENEFICIAL OWNERSHIP DECLARATION FORM and send to the Commission at not later than seven (7) days from the date of this notification.

“All entities that henceforth apply for participating interest in an exploration or production oil and gas license, lease or contract shall also be required to fill the BENEFICIAL OWNERSHIP DECLARATION FORM and submit with their application.

“Notice of change in persons in significant control over a relevant person shall be provided by the relevant person within 30 days of the change using the CHANGE IN BENEFICIAL OWNERSHIP DECLARATION FORM”.



Nosa Omorodion Wins the AAPG’s Outstanding Leadership Award

The Nigerian geologist Nosa Omorodion, has been announced as the winner of one of the most distinguished awards given by the American Association of Petroleum Geologists AAPG).

The award is Michel T Halbouty Outstanding Leadership (MTHOL) Award, given “in recognition of outstanding and exceptional leadership in the petroleum geosciences”.

The AAPG is the world’s leading professional society for petroleum geoscience, with over 30,000 members worldwide.

The MTHOL Award is named for Michel T Halbouty, an American geologist, petroleum engineer, and wildcatter who was credited with discovering more than 50 oil and gas fields.  In a long, storied, life (he died in 2004 at the age of 95), Halbouty twice declared bankruptcy, but came back each time to regain wealth. He authored hundreds of technical articles on petroleum geology, and two book-length histories of famous oil fields. Halbouty is often described, including in his New York Times obituary, as “legendary.”

The award is one of the top two of the 12 awards announced for 23 geoscientists from across the world for 2023.

The honorees, approved by the AAPG Executive Committee, “were selected based on service to the profession, the science, the Association and the public”, the AAPG says on is website.

Most on this year’s award list are American; but there are also Canadians, Italians and Nigerians.

Apart from Mr. Omorodion, who is an Executive Director at the Nigerian operations of Schlumberger (the giant, global oilfield services company), there are three Nigerians on the list, including Akinwande Oluseye Ekun, who is an earth scientist in Chevron’s Houston offices and Mimionitu Opuwari, a professor of geosciences at the University of Western Cape, Cape Town, South Africa. Ekun and Opuwari are honoured for “Distinguished Service” to the profession, the science, the Association and the public.

Philip Ajaebili, a reservoir geophysicist at Shell Nigeria, is honoured with a “Young Professionals Exemplary Service Award”.

Mr. Omorodion, who counts, in his profile, 34 years of post-graduation experience in the oil and gas industry, is one of those individuals you could describe as keen enthusiasts of professional associations.

He is a former President of the Nigerian Association of Petroleum Explorationists (NAPE) and has been bullish on AAPG, the world’s largest grouping of earth scientists. He has been on the Distinguished Lecture Committee (International); , he has been Secretary/Treasurer AAPG Africa Region; Membership Coordination and Communication, AAPG Africa Region; President, AAPG Africa Region; General Co-Chair, AAPG-NAPE Deepwater West Africa Conference; General Co-Chair, AAPG Africa/Europe Joint Conference, Marrakesh, Morocco; on the Technical Committee, AAPG International Conference and Exhibition, Istanbul, Turkey.

The full list of the AAPG 2023 honorees is as follows:


    • Kitty Milliken, Bureau of Economic Geology, Austin, Texas
    • Nosa Omorodion, Schlumberger, Houston, Texas (Africa Region)
    • Robert D. Hatcher Jr., University of Tennessee, Oak Ridge, Tenn.
    • Cynthia Huggins, Aera , Bakersfield, Calif.
    • Linda Price, ExxonMobil, Houston
    • Thomas E. Ewing, Frontera Exploration Consultants, San Antonio, Texas
    • Amy Fox, Enlighten Geoscience Ltd., Calgary, Canada
    • Rebecca Caldwell, Chevron, Houston
    • Joseph R. Davis, BKV Corp., Dallas, Texas
    • Raffaele Di Cuia, Delta Energy Ltd., Ferrara, Italy
    • Akinwande Oluseye Ekun, Chevron, Houston
    • Mimionitu Opuwari, University of Western Cape, Cape Town, South Africa
    • Douglas N. Valleau, Strategia Innovation and Technology Advisors, Spring, Texas
    • Virginia Sisson, Yellowstone Bighorn Research Association, Houston
    • Robert Trentham, University of Texas-Permian Basin, Odessa, Texas
    • Kirsten Siebach, Rice University, Houston
    • Neal and Inda Immega, HMNS, Houston
    • William A. Ambrose, Bureau of Economic Geology, Austin, Texas
    • Dan J. Hartmann, DJH Energy Consulting, Fredericksburg, Texas
    • Philip Ajaebili, Shell, Port Harcourt, Nigeria
    • Andrea Lopez Vega, Total Energies, Luanda, Angola
    • William P. Bosworth, Apache, Cairo, Egypt


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