Iraq Wants To Buy Exxon’s Stake In Key Oil Field

By Irina Slav - Jun 20, 2022,

The Iraqi government is ready to buy Exxon's stake in the West Qurna-1 oil field, the country's oil minister said this weekend, after the supermajor earlier announced plans to exit the project.

Per news reports from Reuters and Bloomberg, the bulk of the 32.7-percent interest in one of Iraq's largest fields will go to Basra Oil Company.

Earlier this year, Exxon had agreed with two Chinese companies to transfer its West Qurna-1 stake to them, but the Iraqi government was not on board with that deal, and it was never finalized. Exxon's stake in West Qurna-1 was valued at up to $500 million in 2020 when the supermajor announced its plan to exit Iraq.

As for the reasons for the exit after a long involvement in Iraq's oil industry, at the time, Iraqi Prime Minister Mustafa al-Kadhimi said that "Exxon Mobil is considering exiting Iraq for reasons that are to do with its internal management practices, decisions, and not because of the particular situation in Iraq."

At the time, Al-Kadhimi said that Iraq would only accept another American company as a replacement for Exxon at West Qurna-1.

Media, however, suggested that the decision might have something to do with worsened relations between the supermajor and the Iraqi government after Exxon got involved in oil production in the Kurdistan autonomous region, whose leadership is at odds with Baghdad.

Iraq is the second-largest producer of oil in OPEC, but it has been struggling to produce as much oil as it had been assigned under the OPEC+ agreement reached last year.

Despite the problems plaguing its oil industry, however, Iraq has ambitions of higher production still, eyeing an average daily of 4.51 million barrels for this month and 4.58 million barrels for July, per a Bloomberg report. In May, Iraq produced 4.4 million barrels of oil daily, a decline of 21,000 bpd from April.

By Irina Slav for Oilprice.com

 

Ecuador Halts All OIl Operations Amid Escalating Protests

By Michael Kern - Jun 20, 2022, 

Ecuador's state-owned oil company Petroecuador declared force majeure across exploration, production, and transportation operations amid escalating protests against the government.

This means that exports of oil from the Andean country will be halted, as protesters entered oil fields, Reuters reported, citing a statement by Petroecuador.

The protests by indigenous peoples in Ecuador against the economic policies of the government of Guillermo Lasso, which have recently included fuel price hikes, prompted the president to declare a state of emergency across three provinces. This, however, did not stop the protests, as people demanded cheaper fuel and food price controls, Al Jazeera reported.

The state of emergency was motivated by the high degree of violence erupting among protesters in the three provinces where it was declared, with President Lasso saying, "I called for dialogue and the answer was more violence, there is no intention to find solutions."

In addition to the economic demands of the protesters, they also want a suspension of new mining and oil projects, Reuters reported. As a result of these protests, Petroecuador said it had lost some 6,975 barrels of crude and has had to suspend some drilling operations.

Ecuador has proven reserves of some 8.273 billion barrels of crude oil but is producing only about 400,000 bpd. Petroecuador, however, has the ambition to double this over the next five years and is looking for private sector investments of up to $12 billion to do it.

"In order to complete these projects within the planned deadlines, private capital and adequate regulations to provide legal certainty to those keen to invest in the hydrocarbon sector will be needed," the state company said earlier this year as quoted by Reuters.

"There are approximately 45 billion barrels of oil identified and only 14% is being produced, a figure that shows resources are not used properly," said the chief executive of the company separately.

By Michael Kern for Oilprice.com

People Rally In Belgium To Protest Soaring Cost Of Fuel, Food

By Tsvetana Paraskova - Jun 20, 2022, 

More than 70,000 people rallied in Belgium’s capital Brussels on Monday in a protest against the soaring cost of guel and food, while strikes at transportation services brought the city home to many of the EU institutions to a standstill.

Workers at the Brussels airport and at local transport networks went on a one-day strike, demanding the government take action against surging prices of food and fuel.

Departures at the airport were canceled as security personnel were also on strike. Most arrivals were also canceled.

Inflation in Belgium and all other European countries has spiked in recent months, to 9 percent this month, as the Russian invasion of Ukraine has sent commodity and fuel prices sky-high and has disrupted supply chains globally, which were still reeling from COVID-related disruptions.

Inflation in Belgium in May was just below 10 percent, the country’s National Bank said in an assessment last week, expecting a gradual easing of the inflation to below 2 percent by the autumn of 2023, barring a wage-price spiral. Wage costs are unprecedentedly high, posing a threat to the competitiveness of the Belgian economy, the bank said.

Workers in Belgium have received pay rises indexed to inflation in recent months. Belgian Prime Minister Alexander De Croo has said workers and employees are better protected against inflation than many other EU workers because of the wage indexation to inflation.

The Belgian National Bank has described the spike in energy prices as “a major impoverishment for the Belgian economy.” Yet again, the inflation-indexed wages have spared many Belgian households from the worst of the energy price surges, the bank said.

Belgium’s pace of economic recovery from COVID is set to slow to 2.4 percent growth in 2022 and 1 percent in 2023, “notably as the consequences of the embargo of the European Union on Russian oil materialize,” Organisation for Economic Co-operation and Development (OECD) said in a report earlier this month. Core inflation is forecast at close to 5 percent through 2023 before easing.

By Tsvetana Paraskova for Oilprice.com

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Namibia Bets On Recent Major Oil Discoveries To Double Its Economy

By Tsvetana Paraskova - Jun 21, 2022,

Following several offshore oil discoveries in recent months, Namibia hopes that the major oil finds could help it double its economy in the next two decades, the head of the National Petroleum Corporation of Namibia (NAMCOR) told Bloomberg on Tuesday.

Since the beginning of the year, oil majors Shell and TotalEnergies have announced discoveries offshore the African country.

“More than 30 years of exploration and we finally we hit the jackpot,” Jennifer Comalie, NAMCOR’s chairperson, told Bloomberg in an interview.

“At peak, these two discoveries could bring $5.6 billion to a very small economy,” Comalie said.

The economy of Namibia, neighbor to the south of OPEC producer Angola, is currently valued at around $11 billion.

Namibia could begin production around 2030 or a little bit earlier if appraisals for the recent discoveries support initial estimates and, of course, majors commit to developing those discoveries while they look to become net-zero energy companies by 2050.

In April, Shell said it was “very encouraged” by the early results from the deep-water Graff-1 exploration well completed earlier this year.

“Over the coming months, we’ll need to conduct further evaluation of the well results, and additional exploration activity, in order to determine the size and recoverable potential of the hydrocarbons that were identified,” said Dennis Zekveld, Shell’s Country Chair in Namibia.

Shell also made a second discovery in the Orange basin in April.

In the same basin offshore southern Namibia, TotalEnergies has made a significant discovery of light oil with associated gas on the Venus prospect, the French supermajor said in February this year. TotalEnergies also needs to proceed with appraisal drilling operations in the area in order to assess the commercial prospects for the discovery.

“This discovery offshore Namibia and the very promising initial results prove the potential of this play in the Orange Basin, on which TotalEnergies owns an important position both in Namibia and South Africa” said Kevin McLachlan, Senior Vice President Exploration at TotalEnergies.

By Tsvetana Paraskova for Oilprice.com

U.S. Gasoline Demand Increasing, Not Waning

By Tsvetana Paraskova - Jun 21, 2022, 

U.S. gasoline demand increased by 5.5 percent on Sunday compared to the previous Sunday and was 11.4 percent higher than the average U.S. demand of the past four Sundays, according to data from fuel-savings app GasBuddy.

In the week between June 12 and June 18, U.S. gasoline demand jumped by 6.3 percent from the prior week and was 7.4 percent above the rolling four-week average.

“It was the highest week of 2022,” Patrick De Haan, head of petroleum analysis at GasBuddy, said on Sunday. 

Over the past week, U.S. national average gasoline prices fell for the first time in nine weeks, GasBuddy said on Monday.

Per GasBuddy data, weekly gasoline prices fell by 4.2 cents from a week ago to $4.97 per gallon on Monday. Still, the national average is up 37.3 cents from a month ago and $1.92 per gallon higher than a year ago.

“Finally some relief! For the first time in nine weeks, gasoline prices have fallen, following a broad sell-off in oil markets last week, pushing the national average back under the $5 level with most states seeing relief at the pump,” De Haan commented on Monday.

“I’m hopeful the trend may continue this week, especially as concerns appear to be mounting that we may be on the cusp of an economic slowdown, putting downward pressure on oil. But the coast isn’t yet entirely clear. We could see the national average fall another 15 to 30 cents, if we’re lucky, by the time fireworks are flying, barring any unexpected shutdowns at a time when the market is extremely sensitive to such.”

The Biden Administration is desperate to see $5 a gallon prices drop, and its latest idea is a gas tax holiday. The U.S. Administration is considering a temporary pause of the federal gas tax as a tool to reduce prices at the pump, Energy Secretary Jennifer Granholm said this weekend in an interview with CNN.

By Tsvetana Paraskova for Oilprice.com

Vital Metals starts commissioning at Saskatchewan rare earth extraction plant

Staff Writer | June 17, 2022 | 

Vital’s rare earth extraction plant in Saskatoon, Saskatchewan. Image from Vital Metals.

Canada’s first rare earths producer, Vital Metals (ASX: VML l OTCQB: VTMXF), announced Friday it has begun feeding ore into a dense media separation (DMS) plant as part of commissioning of its rare earth extraction facility in Saskatoon, Saskatchewan.


Vital will commission the Saskatoon facility incrementally over the coming months with plans to produce a 2.5t rare earth carbonate sample for offtake partner REEtec as the next step of product qualification.

Vital is processing ore from the company’s Nechalacho operation in Canada’s Northwest Territories, where mining commenced in mid-2021.

“This is an exciting step for the company as we continue our transition from rare earth developer to operator,” Vital Metals managing director Geoff Atkins said in a media statement.

“We have been a rare earth miner for more than 12 months and now we can commence production of rare earth carbonate,” he said. “We are excited to have reached this milestone at Saskatoon despite the challenges surrounding supply chains and logistics across the world.

“We are targeting to produce 2.5t of carbonate for REEtec as an important step of our production qualification process before we commence ramping up our volume,” Atkins said.

“We are forecasting for this to occur in October 2022.”

Over the coming months, Vital said it will incrementally commission the calcination, leaching and purification and precipitation equipment at the plant, adding this approach will focus on producing product at specification while minimising off-spec production, and wastage.

Vital’s Saskatoon plant will have initial throughput capacity of 1,000 tonnes per year of rare earth oxide (REO) excluding cerium, which is equivalent to ~470t NdPr/year.

The facility is adjacent to a rare earth processing plant under construction by Saskatchewan Research Council (SRC) as part of a rare earths hub.

Methane-spewing coal mines are climate test for Australia’s new leader
Bloomberg News | June 17, 2022 | 

Most of Australia’s coal mines are in the Hunter Valley (pictured), Bowen Basin and Surat Basin regions. (Image: Max Phillips (Jeremy Buckingham MLC) | Flickr.)

Australia’s coal mines cause more planetary warming in a typical year than emissions from all of the country’s cars. If Prime Minister Anthony Albanese wants to meet tougher climate targets, he’ll need to fix that.


Satellite observations suggest the best place to start is the Bowen Basin, the major coal hub in Queensland state, and an area where scientists have estimated the methane intensity per unit of production is 47% higher than the global average.

A satellite earlier this month spotted a plume of the potent greenhouse gas that geoanalytics firm Kayrros SAS estimated originated within about 25 kilometers (15.5 miles) of coal mines operated by Anglo American Plc, BHP Mitsubishi Alliance and Stanmore Resources Ltd. None of the companies answered questions from Bloomberg asking if their mines emitted methane the day of the satellite observation.

“Methane leaking from coal mines has been ignored for many years, but tackling it is the ‘low hanging fruit’ in Australia’s effort to combat climate change,” Sabina Assan, an analyst with environmental think tank Ember, wrote in a report released this month.

The Bowen Basin has become a global example of the disparity between reported coal mine methane emissions and independent measurements, according to the report. The powerful green house gas can leak from underground and open-cut coal mines and has 84 times the warming power of carbon dioxide during its first two decades in the atmosphere.

The most recent release, observed on June 3rd by the European Space Agency’s Sentinel-5P satellite, was estimated to have an emissions rate of about 12 metric tons of methane an hour and could have come from several mines, according to Kayrros. Coal production typically runs 24 hours a day, so methane is often emitted constantly from mines. Release levels might fall during maintenance, or rise if miners hit a gas pocket.

If the rate estimated by Kayrros was consistent for a year, the gases would have the same short-term warming impact as the annual emissions from roughly 1.9 million US cars.

Australia’s new government, voted into office last month, on Thursday confirmed an election pledge to lower carbon emissions by 43% from 2005 levels by 2030, tightening a previous commitment for cuts of 26%-28%.

When contacted about the June 3 release, Australia’s Department of Industry, Science, Energy and Resources didn’t say if it was aware of the emissions or investigating them. “Making reliable, ‘top-down’ estimates of emissions from the satellite data is difficult for a number of reasons, including challenges associated with a lack of ground-truthing, instrument and modelling errors, and attribution,” the department said.

The agency emphasized that coal-mine operators are required to estimate and report company and facility level greenhouse gas emissions under reporting guidelines and that the country’s Clean Energy Regulator publishes reported emissions data annually.

But Australia has had problems with some operators who report their own emissions. Peabody Energy Corp. said in January it had made errors in data filed to the local regulator, and appointed an auditor to review its processes.

In February, Australia disclosed it had revised the method used to calculate methane pollution from open-cut coal mines and said the change means total national emissions were on average 0.3% higher than previously stated for each year since 1990. That revision was prompted by the use of satellite data, which has improved capacity to estimate emissions, the government said.

In Australia’s latest report to the United Nations, the government reported that active and abandoned coal mines released about 1 million tons of methane in 2020, while cars generated about 40 million tons of carbon dioxide.

(By Nicholas Swee Yang Lua and Aaron Clark)

Oil producers are planning the world’s biggest floating wind farm

Bloomberg News | June 17, 2022 

Whitelee wind farm in the UK. (Reference image by eltpics, Flickr).

A group of oil and gas producers including Equinor ASA, Shell Plc and TotalEnergies SE are considering building what would be the world’s largest floating wind farm off Norway to power their fossil-fuel activities.


The companies are looking at options to build a 1-gigawatt wind farm to power operations in the Troll and Oseberg oil and gas fields, they said Friday. It’s an example of the complex road to cutting global carbon emissions, where deep-pocketed fossil-fuel firms with strong engineering expertise could play a key role in renewables growth even as they continue their polluting businesses.

Offshore wind farms are one of the fastest-growing sectors of renewable energy. But the vast majority of existing and planned projects are in shallow waters where turbines can be placed on foundations built up from the seabed. Developing floating technology could drastically expand the sea area suitable for generating wind power.

The technology has so far only been used on small pilot projects. Equinor pioneered the concept at a Scottish site and is building a bigger one in Norway. The new project being considered, named Trollvind, would be more than 11 times larger than the Norwegian one, pushing floating wind to a scale that will be needed for it to make a real contribution to global efforts to cut emissions.

Equinor and its partners, which also include Petoro AS and ConocoPhillips, would buy all of the electricity from the project to power their fossil-fuel activities in the North Sea. The wind farm would be connected to land so that it could also potentially feed homes and businesses.

“Trollvind is a concept where renewable energy works to facilitate several objectives; helping cut emissions through electrification, delivering power to an area where shortages have already created challenges for new industrial development,” Equinor Chief Executive Officer Anders Opedal said in a statement.

The companies plan to make an investment decision next year and have the project operational by 2027.

Emissions from oil companies’ own operations and energy needs account for just a small fraction of their overall climate impact. For example, Equinor last year produced about 12.1 million tons of carbon dioxide from activities it owns and operates, but the total impact of its business exceeded 250 million tons.

Still, investment in projects like Trollvind are in important step in scaling up renewables technology to reach global green targets.

(By Will Mathis)

Bolivia delays decision on lithium mining tie-ups to December
Reuters | June 17, 2022 

Bolivia’s Salar Uyuni, near the border with Chile, holds more lithium carbonate 

reserves than anywhere else. (Image: Benedikt Juerges | Shutterstock.)

Bolivia’s government will not make a final decision on potential lithium mining tie-ups with private partners until December, six months behind its initial schedule, a senior official told state television on Friday.


The government is currently evaluating six companies to help mine the country’s untapped lithium riches. One or more could eventually be selected to partner with state-owned Yacimientos de Litios Bolivianos (YLB).

Alvaro Arnez, vice minister of high energy technologies, told the state broadcaster that the government now plans to have proposals ready for companies to consider by the end of October, with a final deal or deals in place by the end of December.

The government had previously planned to announce its final selection last month. It hopes private partners can help jumpstart lithium extraction in Bolivia’s sprawling salt flats, home to the world’s largest deposits of the white metal coveted by rechargeable battery makers.

Despite decades of attempts, Bolivia has yet to achieve any commercial lithium production. Demand for the ultra-light metal has surged in recent years.

This month, the government narrowed the final selection from eight to six suitors, after disqualifying American startup EnergyX and Argentine energy firm Tecpetrol.

Bolivia, one of the poorest countries in the Americas, faces steep challenges to meet its target of producing lithium-ion batteries locally by 2025.

A Reuters report last month highlighted the technological challenges, social resistance, legal obstacles and political scrambles undermining Bolivia’s extractions plans.

None of the short-listed firms have exploited lithium at a commercial scale before.

(By Daniel Ramos and Isabel Woodford; Editing by David Alire Garcia and David Gregorio)

New mapping method may lead to discovery of new geothermal energy, green metal resources

Valentina Ruiz Leotaud | June 19, 2022 

Geothermal energy. (Reference image by Simon, Pixabay).

Researchers at the University of Twente developed a new method to analyze the earth’s continental crust, which lays the groundwork to predict geothermal energy sources and other critical resources on earth and other planets.


In a paper published in the journal Nature Geoscience, lead researcher Juan Carlos Afonso explains that, normally, earth scientists look at one aspect of the earth’s crust at a time using specific data sets. However, it is actually both the crust’s chemical structure and the small differences in temperature that inform geoscientists on the origin and evolution of the planet and on the location of resources beneath our feet.

Yet, combining multiple data sets for this purpose remains a major challenge.

Despite those difficulties, Afonso managed to formally combine multiple satellite data sets with land-based data sets to see further into the earth than previously possible.

“It is a completely new way of ‘seeing’ what’s below there,” Afonso said.

The researcher pointed out that previously, the only reliable approach for deep resource exploration was the analysis of xenoliths, and rock samples brought to the surface by volcanoes.

“When you’re dependent on volcanoes, you can imagine that such samples are hard to come by. They are scattered in space and time and still have large uncertainties,” Afonso said.

The scientist and his team focused on central and southern Africa. The Kalahari, Tanzanian and Congo cratons—ancient and stable parts of the earth’s two topmost layers—in the area proved useful.

“Central and Southern Africa is a natural laboratory that helps us answer fundamental questions about the formation of cratons,” Afonso said. “And there are plenty of datasets on those needed xenoliths that helped us prove our method.”

According to Afonso and the co-authors, this approach adds to the development of the next-generation planetary models and supports the search for resources aimed at producing cleaner technologies. It also lays the groundwork for innovative resource exploration frameworks for earth, and other planets.

“Maybe Mars and/or the Moon can be next,” he said.