November 7

Daily Energy Standup Episode #246 – China-Russia Gas Agreement, Southeast Asia’s LNG Peak, Mideast War Impact, BP Exit, and Canadian Deal


Daily Standup Top Stories

China, Russia Intensify Efforts to Expedite New Gas Route Supply Agreement

(MENAFN) China National Petroleum Corporation (CNPC) Vice President, Xie Jun, has disclosed that Russian energy giant Gazprom is collaborating with China to fast-track the implementation of a new gas supply route known as the Far […]

Southeast Asia’s LNG investments predicted to peak by 2040: Study

More natural gas facilities than ever will be firing in Southeast Asia almost two decades from now, according to a report by Singapore-based research firm Asia Research & Engagement (ARE). Led by Thailand, Indonesia and Singapore, the region currently […]

Mideast War Turns Spotlight on Arab Gas Pipeline

The Israel-Hamas war has not significantly impacted Mideast oil and gas flows so far, but critical energy infrastructure such as the Arab Gas Pipeline (AGP) is being watched closely. The pipeline connects Egypt with Jordan and […]

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Video Transcription edited for grammar. We disavow any errors unless they make us look better or smarter.

Michael Tanner: [00:00:15] What is going on, everybody? Welcome to another edition of the Daily Energy News Beat Standup here on this gorgeous Tuesday, November 7th, 2023. As always, I’m your humble correspondent, Michael Tanner, coming to you from an undisclosed location here in Dallas, Texas, joined by the executive producer of the show, the purveyor of the show and the director and publisher of the world’s greatest Web site,, Stuart Turley, my man, how are we doing today. [00:00:36][21.8]

Stuart Turley: [00:00:37] It’s a beautiful in the neighborhood in our news desk was crazy today. [00:00:42][4.7]

Michael Tanner: [00:00:43] Absolutely we have an absolutely stacked menu lined up for you guys. First up on the show, china Russia intensify efforts to expedite new gas route in new supply agreement. Next up, Southeast Asia’s LNG investments predicted to hit peak by 2040. That’s according to a new study out of the Asia Research and Engagement Institute there in Singapore, says dual cover what all they’re saying. Next up are Mideast war turns Spotlight on Arab gas pipeline. That’s big for all. You know, speaking of LNG development, that’s huge. And finally, following BP’s exit, operatorship of giant gas discovery changes hands as US player takes the rings. Dun dun dun. So we will still will dive into exactly who’s taking over that big BP gas position over there. He’ll toss it over to me. I’ll quickly cover what happened in the oil and gas markets today and then touch slightly on a deal that happened in Canada. Interesting. I was familiar with the Canadian M&A market as as I am the U.S. But this is an interesting deal. And we’ll we’ll cover it from from a few different angles. And then we will let you guys get out of here and start your gorgeous Tuesday. Before we do all that, guys, remember everything you are about to hear. The stories and analysis are brought to you by the world’s greatest website. The best place for all of your energy news. I highly recommend checking it out soon. The team does a great job of curating that website, making sure it stays up to speed to make sure you’re at the tip of the spear when it comes to the energy business. Appreciate the team’s hard work for that. You can hit us up that’s our data news combo lead us some comments email the show questions@energynewsbeat@com. You can find us on Apple Podcasts, Spotify or wherever you get your podcasts. Check us out on YouTube at Energy News Beat and again, appreciate everybody who supports the show. Check out the description below. Timestamps links everything you’ll need to do to stay informed with the show. I’m out of breath tho Stu. Where do you want to begin? [00:02:35][112.0]

Stuart Turley: [00:02:35] Okay, let’s start with my buddy. The producer can slide in pictures that we have for us. This is actually what I think I look like. But I know. [00:02:45][9.4]

Michael Tanner: [00:02:45] Do you think this is what you think? You look like the dude. [00:02:48][2.5]

Stuart Turley: [00:02:49] The dude. This is actually Jeff Bridges. I mean, he looks good. And so now it’s a little different. He goes, Oh, it’s the best Scooby I’ve seen in a long time. And Anonymous is actually a wonderful resource on Twitter. And so we’ll have his contact information. But let me read this one phrase to you because I really had to go. But it made sense. If the Biden administration is trying to bring additional oil supplies from Venezuela and Iran to avoid high end gasoline, oil and gasoline prices next summer before the 2024 elections, they will not succeed unless we have a recession. End of story. What do you think? [00:03:40][51.5]

Michael Tanner: [00:03:42] I mean, it’s I think what we’re doing with it with with Venezuela and trying to bring the I mean, it’s it’s pretty backwards considering what we should be doing, exporting our own energy resource. So pretty crazy. [00:03:53][10.9]

Stuart Turley: [00:03:54] I don’t get it. And quite honestly, I think I have a nice debt on. Right. Because if in order for it to work, they’re going to have to have a recession. In order to have a recession, they’re going to people are tired. All right, let’s run on down the road. I just I live in a nice China Russia intensify efforts to expedite new gas route supply agreement. Michael, this is a 30 year agreement that is just nuts. When you sit back and take a look at the collaboration between china and Russia, it is going crazy. So right now, the 30 year agreement deliveries commenced in 2019. It will reach full capacity of 38 billion cubic meters in 2025. My hope that is a lot of gas and a lot of energy for through Siberia to China in that crazy. [00:04:45][51.4]

Michael Tanner: [00:04:46] Well, what it really does is it is it you know, it shows a few things. I think the first thing it shows that sanctions as much as we wish they work, don’t and not to patch you on the back against do but sanctions don’t work because if you don’t have every single country commit to them, it doesn’t mean anything. So, you know, we try to cut off oil supply here. We try to cut off gas supply via the Nord Stream. I mean, we didn’t bomb it. It was somebody else. So just put that out there. The sarcasm. Course it was the Ukrainian SEALs. But we they’re going to find a way to sell their product because it’s a valuable commodity in the market. I do find it funny, you know, in my opinion, the real question is they’re striving to build a closer energy partnership. I mean, that’s a middle finger to the U.S., to a big middle finger to the U.S. and the West. [00:05:31][45.3]

Stuart Turley: [00:05:32] Oh, it is. And that is increasingly something we see in all the articles. There’s a couple of great ones on in Newsbeat today where they’re having the whole everybody is flipping their finger off at the U.S., So. All right, let’s see what’s next to the next one. Southeast Asia LNG investments predicted to peak by 2040. So we have a peak hour here on the show. He just happened to walk in. I think it was Jerry Nadler’s. He was walking off stage more natural gas. That was funny, by the way. More natural gas facilities will be firing in Southeast Asia in more than two decades. That is just nuts. Here comes if allowed to continue. The expanded LNG stands to thwart efforts to keep global warming below 1.5. Growing investment in LNG by the Philippines, Vietnam and other Southeast Asians will not only help push the world the world further beyond this critical target. People don’t understand that the only successful markets that will be rolling will be the Asian markets, because they’re going to continue to use low cost energy and they’re going to actually have lower input imprint than using renewables. Look at this, Michael. The Philippines received a shipment in April to fuel a 1200 megawatt power plant, even though through its declining reserves in the natural gas field, the LNG is saving Asia. [00:07:10][97.9]

Michael Tanner: [00:07:10] Yep. Well, because it’s it’s it provides again, that baseload energy that people so desperately need, specifically where you’re in a part of the world where access to low cost energy can drastically improve your standard of living. You know, I think it’s interesting. Kurt Metzger, he’s the energy transition director for that Asian Research Council. He said Southeast Asia’s limited legacy LNG infrastructure makes the pivot to low carbon power sources a viable option compared to investing in new LNG infrastructure. So I think what they’re attempting to do is say since they don’t have any LNG, we might as well go build some unprofitable wind and solar. So we know where that’ll end up. [00:07:51][40.7]

Stuart Turley: [00:07:51] Oh, absolutely. It’ll be back into Germany shooting themselves in the foot and, you know, providing some extra shoes for them to eat in the winter. Okay. [00:08:00][8.3]

Michael Tanner: [00:08:00] What’s next? [00:08:01][0.3]

Stuart Turley: [00:08:01] Go to let’s go to the next one. We’re going to go to the Mid Midwest. Mideast War Turns Spotlight on Arab Gas Pipeline. Boy, I got all choked up on that one. Michael. The Israel-Hamas war has not significantly impacted Middle East oil and gas flows. But I’ll tell you what, it’s shaking everybody up and really bringing energy security to the forefront. Jordan imports almost all the energy it needs if it would have serious socioeconomic implications. I mean, that’s just amazing if we take it. There’s a map on this. If we could have the producer slide it in. You take a look at that pipeline. You have the Egypt pipeline around port side, you have the Arab pipeline, you have the gas future, the extended the dotted line there. And then you take a look at that, you eliminate that pipeline. It becomes a whole horrible problem there. [00:09:02][61.1]

Michael Tanner: [00:09:02] Well, and I think I’ve been covering this for the past week. I think the sentiment on the street has been wild. This this Israel Gaza war that’s going on right now, has it really moved prices upward? If anything, we’ve seen a softening of prices and why? Well, on a macro level, it doesn’t look like it doesn’t look like there’s going to be a huge effect on the overall supply and demand considering that Strait of Hormuz will always stay open. And we’ve deployed a nuclear submarine to the Mediterranean, if only because we understand the vital importance of making sure things like these gas flows and oil flows continue. But I think what’s interesting is that doesn’t mean that countries inside this Arab gas pipeline and who are connected to could experience short bursts of them not having the available gas that they need. I mean, specifically along that Egypt Gaza border right there, as you mentioned from Port Said to Ashley Kahn up there, you know, really right there north of the Gaza Strip. So it’ll be very interesting. Yes. Overall, worldwide gas flows and oil flows may not be affected so much to the point where we’ve seen a softening of prices. But that doesn’t mean something crazy could happen. And I think this article does a really good job of of kind of separating the two and say, sure, overall world supply. I might stay the same, but we may have spurts of zero supply going through this key area which could lead for massive terminal. They mentioned Lebanon, specifically Syria. You know, there are other things. Jordan, as we mentioned earlier, So lots going on in this region. [00:10:27][84.4]

Stuart Turley: [00:10:28] Oh, it is. And so buckle up. We don’t know. We hope for the best. But Michael, that brings us to the next one coming around the corner. Following BP’s exit, operatorship of giant gas discoveries changes hands as U.S. player takes the reins. I really like this one. And Cosmos is the, I believe, Dallas based energy firm that’s taking over for this. And I was looking around on their Web site today. And they are a offshore firm. Do you know much about them? [00:11:02][34.8]

Michael Tanner: [00:11:03] I mean, I know a little bit about Cosmos. I know the fact that, you know, they’re they’re they’re what I would call a cash flow style company, which means they’re going to live and die off cash flow. And if they’re going in and acquiring this 90% working interest specifically in this gas field. Right. They plan to produce the heck out of this 25 trillion cubic feet that they’ve got. So I think it’s an interesting move, you know, from BP, it probably is more of a consolidation of their assets to the Gulf of Mexico versus a, you know, a move that maybe makes operational economic sense. We know they’ve been pulling off wind farm. This is probably a shift away from heavy natural gas wind assets typically to be able to invest more in their oil business. But it will be interesting to see how this goes. You know, these large project, you won’t know if this is a good deal or not for two or three years, but in two or three years it’ll be obvious whether or not it’s a good deal and we’ll be able to look back and see if that that 25 trillion cubic feet is actually a legitimate number. [00:11:59][56.3]

Stuart Turley: [00:12:00] Yeah, that field your car Tangier gas field heat. They got 90% working interest in that bed. Doug Mm hmm. That’s a lot. [00:12:09][9.3]

Michael Tanner: [00:12:10] Yeah, it’s it’s a lot. They can. They’ll be able to crank it up. [00:12:13][3.0]

Stuart Turley: [00:12:14] I’m going to reach out to Andrew in English and see if I can get him on the podcast. That would be a really good one to visit with. See what his thoughts are on it. [00:12:23][9.0]

Michael Tanner: [00:12:23] Would you want to talk about people in the forefront of energy security. [00:12:25][2.3]

Stuart Turley: [00:12:26] Right there, baby? All right. That’s all I got, man. [00:12:28][2.3]

Michael Tanner: [00:12:29] All right. Well, we’ll go ahead and quickly shift over to finance here. Overall, markets were fairly slim today. S&P only up about about a 10th of a percentage point. Nasdaq up 3/10 of a percentage point, really as as the market, you know, comes under and really is digesting a lot of the data that happened last week. We obviously saw the Fed come out and keep interest rates the same. We saw a few other data points, specifically unemployment come up, you know, weaker than what we would have expected or a stronger than what we would have hoped for. Specifically the fact that rising unemployment rate will probably help lower interest rates. But as as we know that we’ll see how the Fed decides to play that one. Looking at oil prices, too, we actually had a little bit of a choppy day. We were up about two and, you know, maybe a percent percent and a half on towards the latter half of the day, saw a little bit of a tumble currently sitting at 8092. You know, here as we record this about 545 here on Monday evening. So, you know, interesting movement down. Really what we’re what we’re seeing in that is over the week. And I think the big news, Stu, was that Saudi reaffirmed both on Sunday that they’re going to continue the additional voluntary cuts of 1 million barrels per day in hopes of keeping their output about 9 million barrels. That really kind of buoyed prices early, late, you know, early on in the trading session. But then we saw a big fall off again. I think a lot of this production cut news has really been baked into the market. And I read somewhere that Saudi is considering another drop and they will continue to reevaluate as they go. You know, and specifically, here’s what this is. UBS strategy strategist Giovanni Serrano. The cuts could be extended into the first quarter of 2024 because what seasonal weaker oil demand at the start of every year, ongoing economic growth concerns in the aim of producers in OPA to support the oil markets stability imbalance could mean that these cuts will continue and that will only help keep prices where they’re at. But again, with the overall market really not pricing in much of what’s going on in the Israel-Hamas conflict right now, it’s going to be it’s going to be interesting to see how things continue to play out. Gas prices did open up a little bit lower today. Natural gas currently trading at $3.28 after opening a little lower, after closing a little under $3.50, again, mainly due to a little bit of of of warmer weather. We are in warmer weather is expected to kind of come through here and specifically in the winter, that’s going to lead to slightly softer prices. I think the only other interesting thing of note still we saw was a you know, we did see some you know, Sandridge Energy went ahead and announced earnings. We saw Terra Energy announce earnings yesterday. We specifically covered kind of our last peek at what Pioneer is doing. But I thought there was one interesting deal north of the border, a.k.a in Canada, which our second favorite. Country. You know, we love Alberta and that, you know, not so much maybe Ontario or wherever. Wherever. Quebec is it Quebec? Is that where their capital is. So maybe maybe Quebec, Quebec. In California, they’ve got a lot in common. But we love everybody up in Alberta. I’m not as familiar with where we were with the Canadian M&A market, but but a private oil and gas company, hammerhead ing, they’re actually a public company here trading on the Nasdaq. RS They’ve gone ahead and announced in a definite agreement to go ahead and sell to Crescent Point, pretty large oil and gas operator with a significant stake up there specifically in that Montney Shale. You know, that’s big way it’s been described to me. The Montney is the equivalent of the Permian Basin stew. It’s thick zones. Couple different pay zones you can target. You know, you can kind of wine rack the wells. You get a lot per location, everything. Well, everyone loves a good little Montney Shale buy. [00:16:08][219.0]

Stuart Turley: [00:16:08] So I also love the accent. Whenever you’re talking to anybody up there with the CEOs I was with Montney. [00:16:14][5.2]

Michael Tanner: [00:16:15] Montney, Montney, it’s a Hammerhead and Chris Boyd, both public companies, Hammerhead majority, actually owned by Riverstone, though. So they’re going to go ahead and cash out. This deals about 2.55 billion and assumes a 70% premium over the five day weighted trading value average. Yeah, they’re doing about five 56,000 body per day. So if you do the math on that deal, Stewart’s about 45,000 per flowing body, which is, you know, not horrible considering the fact that they’ll claim there’s 800 locations available to drill. So, you know. [00:16:47][32.2]

Stuart Turley: [00:16:48] I guess tier one. [00:16:48][0.7]

Michael Tanner: [00:16:49] I don’t want to make a 1 to 1 comparison between the Permian and the Montney, but I’m going to go out on a limb and say there’s probably not 800 locations that are worth drilling. We’ll probably cut that number in half. But this, again, is another consolidation move. You know, I’m surprised we’re not seeing more of this, to be honest, when it comes to Canadian oil and gas, considering we’re seeing a lot of it, you know, in the United States where you would consider the returns are going to be a little bit better considering the diversification. But, you know, good for the Hammerhead. You know, I’m never one to stand up for Riverstone. They’re not necessarily known to you know, as much as I want to stand up and and cheer that a private equity company got paid, I think it’s a good deal for the management team there. You know, that 17% premium, not horrible is a little bit better than what I pay, a little bit better than what Exxon paid for pioneer So you know, good for good for Riverstone able to negotiate. But you know, we’ll be following this one closely. And again, what a whoa, what is this, a good deal or not? And only time will tell, but we’ll we’ll be following this one. Congrats to the Crescent Point team and Hammerhead all in one channel. I’ve got Stu. What else? What what else should we be worried about this week? [00:17:55][65.9]

Stuart Turley: [00:17:55] Oh, more coming around the corner. I get to visit with some more folks from Norway. I got a few others coming up, so it’s going to be a lot of fun. We just dropped Captain Kelly’s. He was a hoot. I actually got a little choked up on that one as a staff got that one out there. That was a little rough as he was talking about it. But it is about energy solving the energy problems. So it’s pretty cool. Humanitarian. [00:18:22][26.4]

Michael Tanner: [00:18:23] Absolutely. So. Well, we appreciate everybody sticking with us here on this Tuesday. You know, stay strong. Week is almost done here, but we’ll let you get out of here and finish and start your day. For Stuart Turley, I’m Michael Tanner. We’ll see you tomorrow, folks. [00:18:23][0.0][1068.7]

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