The global energy industry can keep its debt levels steady if Brent holds at $53 a barrel or higher, according to energy consulting firm Wood Mackenzie. For the U.S. shale industry, the price needed to stop bleeding cash is $45 a barrel, down from $90 a barrel a year ago, helped by cost-cutting, increased efficiency, equity offerings and other measures, the consulting firm said.

After the failure of the Doha deal to freeze oil production, Saudi Arabia's output is now almost certain to rise in the coming months. It wants to regain market share in China and meet the summer peak in its own domestic demand without cutting exports.

As I wrote a couple of weeks ago, it's no surprise that Saudi Arabia refused to join the output freeze championed by Venezuela and Russia. It has little interest in seeing oil prices rise far enough to throw a lifeline to high-cost producers, who are beginning to buckle.

With the failure in Doha, the kingdom will probably lift production over the summer, helping prolong the oil glut. The use of crude for Saudi's domestic power generation usually rises more than 400,000 barrels per day between winter and summer, and we can expect oil production to follow a similar path this year to preserve the volume available to export.

Saudi Arabia has seen its share of the key China market being squeezed. While its sales to China have stagnated, those of arch-rival Russia have soared. At the end of 2013 Saudi Arabia was selling about twice as much oil to China as Russia was. Now they're vying for top spot with Russian sales exceeding Saudi Arabia's in several recent months.

Saudi Aramco, the state-owned producer, appears poised to adopt a new sales strategy to help compete. In a movedescribed by Citibank analysts as 'dramatic', it made a rare one-off sale of crude to a small refiner in China. This seemingly minor change is a striking break from the Saudi policy of only selling oil under long contracts to established refiners with excellent credit ratings. Small Chinese refiners, known as "teapots", have driven a surge in the country's crude imports after being allowed to buy foreign supplies.

We can expect more sales from Aramco's storage tanks in Okinawa and Rotterdam as the kingdom steps up competition with Russia and a resurgent Iran for markets in Asia and Europe. Aramco might also store more oil at the Sidi Kerir terminal on Egypt's Mediterranean coast, letting it make similar spot sales to buyers in the region.

Saudi Arabia's determination to keep pumping more oil into global markets brings to mind its former oil minister Sheikh Yamani, who said back in 2000 that the Stone Age did not end for a lack of stones, and the oil age will not end for a lack of oil.

Those working for him at the time (including me), interpreted this as a warning to OPEC about the pursuit of high oil prices: namely, that it would just speed up the development of alternative technologies and drive away customers, leaving oil sitting beneath the ground without buyers.

Sixteen years later, the kingdom's leaders seem to have heeded his warning. Both Deputy Crown Prince Mohammed bin Salman and oil minister Ali al-Naimi have said they will no longer subsidize high-cost oil production by limiting supply. If there's oil to be left under the ground, they're determined it won't be Saudi Arabia's.

http://www.bloomberg.com/gadfly/articles/2016-05-01/saudi-arabia-heeds-sheikh-yamani-oil-warning?utm_campaign=trueAnthem:+Trending+Content&utm_content=5726399604d30122bc93042f&utm_medium=trueAnthem&utm_source=twitter

As the speed and scale of Iran’s return to the global crude market shows signs of surprising oil analysts, one shipment from the Persian Gulf country that was meant to be a milestone cargo isn’t proving straightforward to shift.

Iran shipped more than 2 million barrels a day in early April, according to ship-tracking data compiled by Bloomberg and the country’s own figures. Added to the amount the nation refines itself, that implies production is already close to pre-sanctions levels. But it hasn’t all proved plain sailing: a tanker that was supposed to be hauling one of the first post-sanctions cargoes has gotten stuck near Romania and it’s not clear exactly why.

The Distya Akula, a 21-year-old vessel, still hasn’t unloaded its 1 million-barrel cargo and has been bobbing for weeks off the eastern European country’s coast, tracking data show. Shortly after the vessel left Iran at the start of February, its owner initially celebrated what could have been the very first cargo delivered to Europe since sanctions were lifted against Iran.

The vessel’s owner at first said Litasco SA, a unit of Lukoil, had booked it. The shipping company also initially said the carrier would go to Constanta on Romania’s Black Sea coast, where Lukoil has a refinery. While that’s where the vessel has indeed ended up, the owner corrected its initial statement and said Litasco wasn’t the buyer and Constanta wasn’t the destination.

Throughout its odyssey, Distya Akula has spent time waiting. It was near the southern entrance of Egypt’s Suez Canal for more than 30 days. Now it’s been near Romania for more than three weeks.

Tehseen Chauhan, an external spokeswoman for Elektrans Shipping, the Mumbai-based owner, declined to comment on why the ship’s voyage has been longer than normal.

A normal shipment to Constanta from Kharg Island, Iran’s biggest export terminal, should take about 17 days. This one has already lasted more than 80. Shipping officials in both Romania and Egypt have so far been unable to provide details of the owner of the ship’s consignment. Traders specialized in Mediterranean oil cargoes have also been unable to identify the buyer of this one.

http://www.bloomberg.com/news/articles/2016-04-29/as-iran-ramps-oil-sales-landmark-cargo-proves-tough-to-deliver

Exxon Mobil Corp. beat analyst estimates as a jump in earnings from its chemicals segment cushioned the blow from tumbling prices for oil and natural gas.

First-quarter net income fell to $1.81 billion, or 43 cents a share, from $4.94 billion, or $1.17, a year earlier, Exxon said in a statement on Friday. The quarterly profit was the lowest since March of 1999, before Exxon merged with Mobil Corp. Still, the per-share result was 15 cents above the 28-cent average of 19 analyst estimates tracked by Bloomberg.

The company was boosted by a 38 percent increase in its petrochemicals division, to $1.4 billion, as well as a 33 percent cut in capital expenditures as it pulled back on drilling and exploration amid weak commodity prices. The world’s biggest non-state oil explorer joined energy giants BP Plc, Statoil ASA and Total SA this week in beating analyst expectations on the back of massive cost cuts and strong refining and chemical results even as oil profits vanished.

“I look at this and say is this an oil company?" Pavel Molchanov, a Raymond James Financial Inc. analyst, said of Exxon’s results. “All of its earnings came from refining and chemicals. It did not make any money, for the first time in modern history, on exploration and production."

The quarter showed the strength of Exxon’s diversification, a factor that would limit the company’s appeal to investors as oil prices recover, Molchanov said.

“This company is very refining- and chemicals-centric and those sectors do not benefit from an oil price recovery," he said in a telephone interview.

Rating Cut

Standard & Poor’s on Tuesday stripped Exxon of its the AAA credit rating the company had held since the Great Depression, citing a swelling debt level. The company was cut to AA+, the same as the U.S. government.

The chemicals division benefited from stronger margins and higher sales volumes, as the price of raw materials -- oil and gas -- plunged compared to last year’s first quarter. The downstream segment earned $906 million as global gasoline demand remained strong, according to the statement.

“It’s the value of the integrated model," Roger Read, a Wells Fargo Securities LLC analyst in Houston, said in a phone interview. “You buy Exxon for its ability to take advantage in all sorts of commodity environments."

Quarterly Payout

Exxon rose 1 percent to $88.91 at 9:32 a.m. in New York. Shares are up 14 percent this year. Among analysts who follow the company, Exxon has eight buy rating, 13 holds and six sells.

The 2016 capital budget has been cut by about 33 percent from last year, a bigger decline than earlier estimated. Despite those measures, full-year profit is expected to dip below $10 billion in 2016 for the first time since the company’s historic acquisition of Mobil Corp. in 1999.

Brent crude, the benchmark for international oil sales, fell 36 percent to an average of $35.21 a barrel during the quarter from a year earlier, according to data compiled by Bloomberg. U.S. gas averaged $1.982 per million British thermal units, down 29 percent from the first quarter of 2015.

Despite the rout in crude markets, Exxon earlier this week raised its quarterly payout to stockholders by almost 3 percent to 75 cents a share. The pledge will cost the company $3.1 billion when the dividend is paid in June.

“The organization continues to respond effectively to challenging industry conditions, capturing enhancements to operational performance and creating margin uplift despite low prices,” Rex W. Tillerson, chairman and chief executive officer said in the statement. “The scale and integrated nature of our cash flow provide competitive advantage and support consistent strategy execution.”

http://www.bloomberg.com/news/articles/2016-04-29/exxon-posts-smallest-profit-since-1999-amid-global-oil-slump

Chevron Corp. lost money during the first quarter for the first time in almost a quarter century amid an oil-market collapse that’s sparked currency crises, corporate bankruptcies, credit downgrades and hundreds of thousands of layoffs across the industry.

Chevron swung to a loss of $725 million, or 39 cents a share, from a profit of $2.6 billion, or $1.37 a year earlier, the San Ramon, California-based company said in a statement on Friday. The result was worse than the average 19-cent loss expected by 19 analysts in a Bloomberg survey. Sales dropped by almost a third to $23.6 billion.

The last time the world’s third-largest oil explorer by market value posted a first-quarter loss was 1992, when crude traded for about $18 a barrel. Chairman and Chief Executive Officer John Watson has cut one of every 10 jobs, lowered production targets and written off some discoveries that would cost too much to bring to fruition as shrinking cash flow prompted Standard & Poor’s a Moody’s Investors Service to cut Chevron’s credit ratings.

“We continue to lower our cost structure with better pricing, work flow efficiencies and matching our organizational size to expected future activity levels,” Watson said in the statement. “Our capital spending is coming down. We are moving our focus to high-return, shorter-cycle projects and pacing longer-cycle investments.”

Despite the squeeze, Chevron this week committed to pay $1.07 to investors for every share they own, a dividend that will cost the company about $2 billion when the checks are cut in June. Spending on capital projects is expected to range from $25 billion to $28 billion this year, Chevron said last month. That would exceed the budget of bigger rival Exxon Mobil Corp. Watson has said capital outlays will drop to the $17 billion to $22 billion range annually in 2017 and 2018.

http://fuelfix.com/blog/2016/04/29/chevron-posts-a-wider-than-expected-loss/?utm_source=twitterfeed&utm_medium=twitter

Minister: revised Qatar LNG deal slashes price to below $5 per MMBtu

Costs of liquefied natural gas imports from Qatar have dropped below $5 per MMBtu due to the revised long-term deal Petronet LNG signed with RasGas, according to India’s minister for petroleum and natural gas, Dharmendra Pradhan.

India’s largest LNG importer, Petronet and RasGas of Qatar signed the deal in December to revise the 7.5 mtpa LNG import agreement the two companies had. Under the initial 25-year deal signed in 1999, Petronet agreed to pay about $12 per MMBtu.

“The current price applicable under the contract works out to less than $5MMBtu based on prevailing crude prices. This revision has led to making LNG cheaper for the end consumers,” minister Pradhan said on Tuesday in a written reply to a question in the Lok Sabha.

Petronet has avoided paying the $1.5 billion penalty for taking less LNG from RasGas than it contracted for 2015, but under the new agreement, it will have to take and pay for all of the volumes it has not taken last year during the remaining term of the long-term deal.

Petronet also agreed to buy additional 1 mtpa of LNG from RasGas for further sale to Indian Oil, Bharat Petroleum, GAIL and Gujarat State Petroleum.

http://www.lngworldnews.com/minister-revised-qatar-lng-deal-slashes-price-to-below-5-per-mmbtu/

A private-led Chinese group is planning to build a $15 billion mega-petrochemical complex on an island near Shanghai, in what would be the country's first and largest energy installation to be built by a non-state investor, industry sources said.

Zhejiang Petrochemical, 51 percent owned by textile giant Rongsheng Holding Group, last month awarded a key design contract for the project, which could compete head-to-head with state-owned firms such as Sinopec that dominate the market.

The project is one of the first concrete signs of Beijing's stated desire to experiment with "mixed ownership" - or partial privatisation - in its massive state-controlled energy sector to boost efficiency and drive greener growth.

"The project was inspired by Premier Li Keqiang's visit in 2014 that called for a pilot 'mixed ownership' project led by private companies," said a senior industry source close to Rongsheng, referring to Li's visit to the city of Zhoushan, where the project will be located.

Rongsheng has partnered with local firms, including a state-owned chemical producer, to build the complex, which would include a 400,000 barrels per day refinery and a 1.4 million tonnes a year ethylene plant.

Details of how the project would be funded were not available.

Zhejiang Petrochemical has awarded the designing contract to three firms, including China Huanqiu Contracting and Engineering Corp and Sinopec's Luoyang Petrochemical Engineering Corp, for the project, to be built on the 6.25 sq km (2.4 sq mile) Dayushan Island, off eastern China, near the ports of Shanghai and Ningbo.

The project, which needs Beijing's approvals including environmental clearances, is likely to start up around 2020, according to two sources with knowledge of the plan.

Rongsheng's press department was not immediately available for comment. Local Zhoushan city officials declined to comment.

Beijing has since July 2015 allowed more than 20 small independent refineries, nicknamed "teapots", to import crude oil for the first time, leading to refining overcapacity that has resulted in China exporting record volumes of oil products.

"The entry of private firms into the refining business was a fruit of the sector reform, but the capacity surplus is a reality to face," said Li Shousheng, chairman of China Petroleum and Chemical Industry Federation.

Rongsheng, founded in 1989 as a small textile firm, has grown into a conglomerate that is also involved in property and logistics with more than 50 billion yuan ($7.7 billion) worth of assets.

It is China's largest independent producer of PTA, a synthetic fibre derived from petroleum for making textile and packaging materials.

Despite being a refining giant, China replies on imports for more than 40 percent of its petrochemical needs.

Rongsheng is among a group of independent petrochemical manufacturers long interested in expanding into the oil refining business that provides the industry's feedstocks.

"That is China's industry dilemma: surplus in fuel capacity, but short in petrochemicals," said Wu Kang, vice chairman for Asia at energy consultancy FGE.

http://www.reuters.com/article/china-private-refinery-idUSL3N17U2ZD

Russia's Yamal liquefied natural gas (LNG) project has signed loan agreements with Chinese banks worth over $12 billion, it said on Friday, circumventing Western sanctions in a major boost for the project led by gas producer Novatek.

Talks with European and Chinese lenders had dragged on for months, complicated by Western sanctions against Novatek and its major shareholder Gennady Timchenko, a friend of Russian President Vladimir Putin, over Moscow's role in the Ukraine crisis.

With the deal, Yamal LNG's external financing needs, seen at $18-$19 billion, are fully covered.

The project has already secured state funds worth 150 billion roubles ($2.3 billion) from a rainy day fund and 3.6 billion euros from state-controlled lender Sberbank and Gazprombank.

Yamal LNG's future had been in jeopardy due to the lack of access to Western capital markets. Plunging oil prices, the benchmark for gas prices, had also clouded its prospects.

Several other global LNG projects, notably the proposed $30 billion Browse floating LNG project off Australia, have been shelved due to global oversupply.

"The project is progressing in accordance with the approved schedule. With the first train of the LNG plant 65 percent complete we are currently at the most intensive phase of construction and assembly works," Yevgeny Kot, director general of Yamal LNG, said in a statement.

The loan deals, the third-largest in Russian corporate history, are likely to be presented in Russia as a victory over what are seen as Western attempts to curb Russia's energy expansion to punish it for its role in the Ukraine crisis.

The new funds will help the $27 billion Yamal LNG project to start producing liquefied gas next year. Three LNG production lines are envisaged, each with an annual capacity of 5.5 million tonnes.

About 95 percent of future production has been pre-sold.

Yamal LNG, the world's most northerly project of its kind, is located beyond the Arctic circle. The gas, frozen at a temperature of around minus 160 Celsius (minus 320 Fahrenheit)will be shipped to global markets including China.

Russia wants to double its share in the global LNG market by 2020 from 4.5 percent currently. Kremlin-controlled Gazprom and Royal Dutch Shell are key shareholders in Russia's only LNG plant, located on the Pacific island of Sakhalin. It produces over 10 million tonnes of LNG per year.

The 15-year loan deals of 9.3 billion euros ($10.6 billion) and 9.8 billion yuan ($1.5 billion) were signed with Export-Import Bank of China and the China Development Bank.

The euro-denominated part of the loan is being made at 3.3 percent above the European benchmark 6-month EURIBOR rate at the construction stage and 3.55 percent above thereafter, Yamal LNG said. The renminbi loan is being made at 3.3 percent above China's 6-month SHIBOR benchmark, and then 3.55 percent above.

Novatek holds 50.1 percent of Yamal LNG. France's Total and China National Petroleum Corp control 20 percent each while China's Silk Road Fund owns 9.9 percent.

http://www.reuters.com/article/russia-china-yamal-idUSL5N17W2G8

Portugese LNG cargo no signal of US impact

It was the question that the European gas industry was asking for months -- when would the first LNG from the US land in Europe?

In the end it only took two months since the first exports departed from Cheniere's Sabine Pass terminal for the US LNG to hit European shores, with the Creole Spirit landing at Portugal's Sines terminal late April 26.

The receiving party of the cargo is understood to be Portugal's gas and power grid operator Redes Energeticas Nacionais (REN), owner of Sines.

But while much of the attention has been on when US LNG would come to Europe, the bigger question really is how much US LNG will come.

The significance of Portugal being the first European country to import LNG from the US should not be overplayed.

It is only a small market -- with just 4.7 Bcm of consumption in 2015 -- and it is entirely dependent on imports, so the delivery of US LNG into Portugal should not be seen as a sign that US LNG will take hold in the wider European market.

In addition, the biggest suppliers to Europe -- Russia and Norway -- do not supply the Portuguese market with their pipeline gas so they are likely to be non-plussed about the first US LNG landing in Portugal.

This suggests that the much-anticipated European gas market share war will not be waged on the Iberian peninsula.

"Iberia is an island market with no liquid hub, so it's semi-historic," a London-based LNG trader said April 27 of the first cargo arriving in Portugal.

"I think it would be more of a landmark if it went to Northwest Europe, signaling a link between the hubs," the trader said.

Algeria threat

For Algeria, and a lesser extent Nigeria, it is a different matter.

Portuguese gas imports come mainly from a few long-term contracts held by the Galp group with Algeria (through Spain) and Nigeria (imported as LNG).

Pipeline gas from Algeria via Spain makes up around 70% of total imports, according to data from the International Energy Agency. This suggests imports via pipeline of around 3.3 Bcm.

For Algeria, that is a significant market -- its total exports by pipeline were estimated at around 27 Bcm in 2015, so Portugal can account for as much as 12% of Algeria's gas exports by pipeline.

And the situation for Algeria could get even worse if US LNG heads for Spain and Italy, its two key export markets.

Algeria's response to the threat of US LNG imports into southwest Europe seems to have been strong.

So far this year Algerian gas flows to Italy have averaged 38.4 million cu m/d -- more than double the 2015 average of 19 million cu m/d and the 2014 average of 18 million cu m/d, according to data from Platts analytics unit Eclipse Energy.

And since the start of April, exports to Italy have averaged more than 60 million cu m/d, Eclipse data shows.

For Spain, Algerian pipeline exports in Q1 averaged 37 million cu m/d, up slightly on the same period of 2015, but again in April have soared to an average of 44 million cu m/d.

Certainly any US LNG exports to Spain would be seen as a direct threat to Algeria's market share and you wouldn't bet against it given Spain's significant underused LNG import capacity.

Targeted exports

Elsewhere on the continent, it looks like Russia and Norway are also headed down the route of defending market share at the expense of price -- mirroring the strategy still being played out by Saudi Arabia in the oil markets.

In the first quarter supplies from Russia and Norway to Western Europe have been running at record highs despite low prices.

Total Russian gas exports to Europe via the Nord Stream, Yamal, and Brotherhood pipelines in Q1 were 28.33 Bcm, 53% higher in comparison with the 18.56 Bcm from Q1 2015.

http://www.platts.com/news-feature/2016/naturalgas/global-gas/index

Chevron said on Friday it expects to resume production at its US$54 billion Gorgon LNG project in Australia in May after the Barrow Island facility was shut down due to mechanical problems.

Repair works on the propane refrigerant circuit on Train 1 at the plant site are nearing completion, Joe Geagea, Chevron’s executive vice president for technology, projects and services, told analysts during the company’s first-quarter earnings conference call.

“We are in the process of reinstating the propane refrigerant circuit,” Geagea said, adding that Chevron expects to restart Train 1 in the next few weeks.

Chevron announced in April that a mechanical issue in the propane refrigerant circuit on Train 1 at the plant site halted production soon after the first cargo departed from the facility on March 21.

US-based Chevron said it expected that the repair works would last 30-60 days. The company did not elaborate on how much the repair works would cost.

“We still expect to achieve Train 1 ramp-up within the previous guidance of six to eight months from initial start-up,” Geagea added.

At full capacity, the plant on Barrow Island will have the capacity to produce 15.6 mtpa of LNG using feedgas from the Gorgon and Jansz-Io gas fields, located within the Greater Gorgon area, between 80 miles (130 km) and 136 miles (220 km) off the northwest coast of Western Australia.

The largest single resource project ever developed in Australia is operated by Chevron that owns a 47.3 percent stake, while other shareholders are ExxonMobil (25 percent), Shell (25 percent), Osaka Gas (1.25 percent), Tokyo Gas (1 percent) and Chubu Electric Power (0.417 percent).

http://www.lngworldnews.com/gorgon-lng-repairs-nearing-completion-production-restart-expected-in-may/

Baker Hughes Inc said it planned to buy back $1.5 billion of shares and $1 billion of debt, using the breakup fee it will receive following the collapse of its proposed buyout by fellow oilfield services provider Halliburton Inc.

The merger, valued at $35 billion when it was first announced in November 2014, would have created North America's largest oilfield services company to take on global market leader Schlumberger Ltd.

Baker Hughes will get $3.5 billion as part of the merger agreement, which the companies terminated on Sunday after opposition from U.S. and European antitrust regulators.

The U.S. Justice Department filed a lawsuit last month to stop the deal, arguing that it would leave only two dominant oilfield services companies.

Baker Hughes, which is focusing on the development of products that lower costs and maximize production for oil and gas producers, also said on Monday it planned to refinance a $2.5 billion credit facility, which expires in September 2016.

The company said an initial phase of cost-cutting was expected to result in $500 million of annualized savings by the end of 2016.

In a separate regulatory filing on Monday, Baker Hughes said it cut 2,000 more jobs in the first quarter, adding to the 18,000 cut worldwide last year. The company had about 43,000 employees as of Dec. 31. (1.usa.gov/23iDCjh)

Baker Hughes said last Wednesday it recorded "merger-retained" costs of $110 million, after tax, in the first quarter, leading to a bigger net loss for the period.

The Houston-based company also said then that it was limiting its exposure to the unprofitable onshore pressure pumping business in North America.

Halliburton, which will release its results on Tuesday, said on April 22 that revenue in the quarter slumped 40.4 percent.

Baker Hughes's shares were down about 1.6 percent at $47.60 in premarket trading.

The company's shares have fallen 25 percent since Halliburton first agreed to buy Baker Hughes in November 2014. Halliburton's shares have fallen more than 19 percent in the same period.

http://www.reuters.com/article/baker-hughes-ma-halliburton-buyback-idUSL3N17Z2J1

Following last week's shocking 1.75mm barrel build at Cushing,Genscape just reported an estimated 821k build which has stunned market participants apparently, sending WTI tumbling back to a $44 handle. Will this be the summer of 2015 oil re-run?

A 2nd week in a row of builds at Cushing..

---

Attached Files

The number of rigs actively drilling for oil dropped by 11 this week as the industry continues to scale back its exploration and production efforts during a time of ongoing layoffs and spending cuts.

The oil rig count dipped down to 332 rigs nationwide on Friday, while the overall rig count, including natural gas-seeking rigs, stands at just 420, according to weekly data collected by Baker Hughes. That represents the lowest total count since the oil field services company first began compiling the data in 1944.

Texas lost a cumulative total of just two rigs on the week, including small losses in both the Permian Basin and Eagle Ford shale plays, while Oklahoma and New Mexico lost three rigs each. Texas is still home to 44 percent of the nation’s operating rigs.

The oil rig count alone is now down nearly 79 percent from its peak of 1,609 in October 2014 before oil prices began plummeting.

Analysts have projected the rig count would dip through most of the first half of 2016.

The benchmark price for U.S. oil was down slightly on Friday, but still trading at about than $45.70 per barrel. That’s almost a 75 percent gain from a low of $26.21 a barrel on Feb. 11.

While many companies have stopped actively drilling new wells, it hasn’t stopped them from producing oil from existing wells. So oil production is taking much longer to fall than the rig count.

http://fuelfix.com/blog/2016/04/29/u-s-oil-rig-count-falls-by-more-than-3-percent-in-a-week/

Imperial Oil Ltd, Canada's integrated oil producer and refiner, reported a slightly bigger-than-expected quarterly loss, hurt by continued weakness in crude prices.

Net loss in the company's exploration and production business more than doubled in the first quarter as the lower crude prices offset benefits from a weak Canadian dollar.

Imperial and other Canadian oil producers record expenses in Canadian dollars, while the price of oil is tied to the U.S. dollar, making the weak loonie a positive at a time when oil prices remain persistently low.

Imperial said gross production rose 26 percent and averaged at 421,000 barrels of oil equivalent per day.

Income from the company's refining business dropped by 43 percent as margins fell.

Exxon Mobil Corp, which owns a majority stake in Imperial, reported a 63 percent drop in quarterly profit on Friday, citing weak prices and lower refining margins.

Imperial's net loss was C$101 million ($81 million), or 12 Canadian cents per share, in the first quarter ended March 31, compared with net income of C$421 million, or 50 Canadian cents per share, a year earlier.

The company's adjusted loss was 15 Canadian cents per share, bigger than the average analyst estimate of 14 Canadian cents, according to Thomson Reuters I/B/E/S.

Total revenue fell 15.8 percent to C$5.22 billion, but beat analysts' average expectation of C$4.66 billion. 

---

Attached Files

Anadarko Petroleum Corp. on Monday posted weaker-than-expected sales for its latest quarter as the rout in the oil sector continued, though its quarterly loss wasn’t as bad as analysts had forecast.

Shares of Anadarko, down about 45% in the past year, fell 2.8% to $50.50 in after-hours trading.

The company, one of the largest independent oil and gas producers in the U.S., along with the broader sector, has been pressured bycollapsing energy prices. Some analysts expect oil prices to hover between $20 and $40 a barrel until the second half of the year, with crude prices remaining highly volatile.

The company, like many energy-related firms, has worked to cut costs amid the downturn. On Monday, Anadarko said it improved its cost structure by $800 million by reducing its dividend and staffing. Total costs and expenses plunged 61% to $2.54 billion.

For the latest quarter, Anadarko posted a loss of $1.03 billion, or $2.03 a share, compared with a loss of $3.26 billion, or $6.45 a share, a year earlier. Excluding certain items, the company posted a loss of $1.12 a share, compared with a year-earlier loss of 72 cents a share.

Revenue fell 28% to $1.67 billion.

Analysts polled by Thomson Reuters expected a loss of $1.16 on revenue of $1.81 billion.

http://www.wsj.com/articles/anadarkos-loss-narrows-on-cost-cuts-1462224694

Ultra Petroleum Corp. filed for bankruptcy protection, the latest oil and gas explorer to fall victim to the prolonged slump in energy prices.

Ultra listed $1.3 billion in assets and $3.9 billion in debt in court papers filed in Houston on Friday. The Houston-based company has 159 employees and its main assets are gas-producing properties in Wyoming, as well as some assets in Pennsylvania and crude oil properties in Utah, according to court papers.

“The low commodity prices, and especially the low natural gas prices that prevailed throughout 2015 and have continued through the first four months of 2016 have had a devastating impact,” Chief Financial Officer Garland Shaw said in a filing explaining events that led to the bankruptcy.

Among its first requests to the court will be for permission to continue a surety bonding program that had $12.6 million outstanding as of the bankruptcy date, and that secures its obligations on environmental, road damage, and plugging of wells, according to court records.

Between March and early April, Ultra missed a series of principal and interest payments owed to lenders and bondholders. And on April 14, the company was sued by pipeline operator Sempra Rockies Marketing LLC for failing to pay transport fees.

http://www.bloomberg.com/news/articles/2016-05-01/ultra-petroleum-files-for-bankruptcy-citing-3-9-billion-debt