The UK government made an announcement in early June stating that the Energy Profits Levy, commonly referred to as the windfall tax, would be reduced to lower levels if oil and natural gas prices consistently returned to normal levels for a sustained period. Currently, the levy places an overall tax rate of 75% on operators in the UK North Sea. However, the government plans to keep this levy in effect for the next five years as long as oil and gas prices remain higher than historical norms. Once prices consistently return to normal levels for a sustained period, the tax rate will decrease to 40%. This decision is part of the government’s strategy to support households with energy bills while ensuring stability for investors and securing the long-term future of domestic energy production. However, the tax rate for oil and gas companies will only revert to 40% if both the average oil and gas prices fall to, or below, $71.40 per barrel for oil and £0.54 per therm for gas, for two consecutive quarters.

Offshore Energies UK (OEUK), the largest industry association, expressed its support for the price floor mechanism but emphasized the need for additional measures to address the industry’s current challenges. “While this is a positive step, there is still much more that needs to be done to restore confidence in our sector. We will collaborate closely with the government and lenders to understand the specifics of this measure and evaluate its effectiveness in attracting investment,” commented David Whitehouse, Chief Executive of OEUK. “Maintaining a predictable and fair fiscal environment is crucial for ongoing UK energy production and success in the global competition for energy investment. By investing in homegrown production, we avoid costlier, less secure and higher carbon imports while supporting an industry we need to make cleaner, more affordable energy in the UK, for the UK. Our sector is expanding into renewable energy, supported by a world class supply chain.

The Turkish Petroleum Corporation (TPAO) has reported that its Fatih drilling ship has initiated operations at a fresh site in the Black Sea. The vessel is now headed to the Filyos-1 well, located near the Zonguldak province. Turkey continues its active pursuit of offshore oil and natural gas exploration using a collection of drilling vessels, including the Fatih, Yavuz, Kanuni, and Abdülhamid Han.

In parallel, seismic assessments are being performed with ships such as the Oruç Reis and Barbaros Hayrettin Pa?a. The seismic survey vessel Barbaros Hayrettin Pa?a, another asset of TPAO, recently anchored at the Trabzon port for planned maintenance and logistics. The ship is gearing up to recommence its oil exploration activities in the Black Sea. It’s worth noting that the Fatih was formerly known as the Deepsea Metro II, under the management of Odfjell Drilling.

Shelf Drilling has announced that its subsidiary, Shelf Drilling North Sea (SDNS), has secured an extension for its Shelf Drilling Fortress jack-up rig, previously known as Noble Sam Hartley. This extension covers two wells for a firm duration of roughly five months, valued at about USD 18 million, extending the rig’s availability to June 2024. Moreover, the contract holds options for two more wells, which could last an additional eight months in total. Currently, the rig is under contract by China’s CNOOC to operate in the Golden Eagle offshore oil field located in the UK North Sea.

This CNOOC International-operated field is situated roughly 11 kilometers northeast of Aberdeen, UK, with its inaugural oil production starting in 2014. The Shelf Drilling Fortress rig is among the five jack-up rigs that Shelf Drilling procured from Noble Corporation in October 2022, subsequent to its merger with Maersk Drilling. Operating predominantly in the North Sea, Shelf Drilling North Sea is a specialized shallow water offshore drilling contractor. With its modern fleet of high-spec, harsh environment jack-up rigs, the company is primed to provide a diverse array of services in the shallow water drilling sector.

Eni has unveiled a notable gas find at the Geng North-1 exploration site, located within the North Ganal PSC, roughly 85 km from the shores of East Kalimantan, Indonesia. Initial assessments suggest the discovered structure holds around 5 trillion cubic feet (Tcf) of gas, coupled with a condensate amounting to approximately 400 Mbbls. This newfound data paves the way for deliberations on expedited development opportunities. Geng North-1 reached a depth of 5,025 meters, situated in waters 1,947 meters deep, and detected a 50m gas column contained within Miocene sandstone, renowned for its superior petrophysical attributes.

This finding followed an in-depth data collection process. A production test (DST) was carried out to fully gauge the scope of the gas find. Even with constraints posed by testing facilities, the findings suggested a potential capacity ranging from 80 – 100 mmscfd and a condensate rate of 5-6 kbbld. This discovery holds the promise to significantly bolster the establishment of a new production center in the Kutei Basin’s northern region. Plans are in motion to link this to the Bontang LNG facilities situated along the East Kalimantan coastline, optimizing its existing storage capabilities. Apart from Geng North, it’s projected that undeveloped finds within this vicinity house more than 5 Tcf of gas, while potential explorations housing multiple Tcfs are currently under evaluation. Eni’s recent find underscores the efficacy of their approach, rooted in a profound understanding of geology and leveraging cutting-edge geophysical tools. Their current exploration endeavors, combined with their latest acquisitions, align perfectly with Eni’s forward-looking energy vision. This involves a gradual pivot towards gas and LNG, with an ambitious 60% target set for 2030, and amplifying their equity in the LNG sector. Both Indonesia and the broader South-East Asia region stand as pivotal players in this strategic shift.

Azerbaijan holds a crucial role in supplying energy to Italy. It stands as the second-largest provider of gas to our nation, just behind Algeria, accounting for approximately 15% of our supply. This share is slightly higher than that of Russia, which has decreased significantly due to the conflict in Ukraine. Italy, much like Germany, heavily relies on gas, which contributes to just under half of our electricity production in power plants. Azerbaijani gas primarily reaches Italy through the Tap pipeline, which terminates in Puglia and has an annual capacity of around 10 billion cubic meters. The recent military actions by Azerbaijan in the Nagorno-Karabakh region have raised concerns regarding our energy security. Nagorno-Karabakh is internationally recognized as Azerbaijani territory, but a portion of it is under the administration of separatist Armenian authorities. It has been a focal point of two wars, with the most recent conflict occurring in 2020, since the dissolution of the Soviet Union in 1991.

This recent action could potentially escalate into a larger confrontation with Armenia, disrupting the geopolitical balance in the South Caucasus region. This area is intersected by vital oil and gas pipelines, with Russia seeking to maintain its influence. Moscow is a significant player in this context and has expressed “concern about the sudden escalation.” However, the Kremlin has emphasized that tensions in the region are the responsibility of Armenia, which, in its view, has created “a fertile ground for hostile Western policies against Russia” and its allies. The United States has countered by labeling Azerbaijan’s operation as “shameful” and is planning to hold urgent talks with the parties involved. If the situation were to further deteriorate and Azerbaijan were to face sanctions from Western nations, it would indeed present a significant problem for Italy.

Kansai Electric Power (Kepco) has recently initiated the reactivation of its No. 2 reactor located at the Takahama nuclear facility in Fukui Prefecture, central Japan. This reactor, originally commissioned for commercial use back in 1975, stands as the second oldest in Japan. Notably, it marks the 12th reactor to be brought back online in the country since the Fukushima disaster in 2011.

With the resumption of operations for this particular reactor, Kansai Electric Power Co. has now successfully reinstated the functioning of all seven of its reactors. This achievement follows the implementation of more stringent safety standards, which were introduced in response to the nuclear crisis stemming from the Fukushima Daiichi complex. The Fukushima incident was triggered by a catastrophic earthquake and tsunami in 2011. It’s worth highlighting that despite the Fukushima disaster, the Japanese government, under the leadership of Prime Minister Fumio Kishida, continues to emphasize the importance of nuclear power generation. This emphasis is driven by the objectives of reducing carbon emissions and ensuring a stable energy supply. In a significant move, Japan’s parliament passed a bill in May, allowing nuclear reactors in the country to operate beyond the previous limit of 60 years.

Recently, the Russian energy behemoth Gazprom achieved a historic feat by successfully completing its inaugural delivery of liquefied natural gas (LNG) through the Arctic Northern Sea Route to China. This remarkable journey, which commenced a month ago, signifies a major achievement for Gazprom.

The Northern Sea Route, extending from Murmansk near Russia’s border with Norway to the Bering Strait near Alaska, has long been regarded by Russia as an alternative to the Suez Canal. Despite its formidable challenges, this route has the potential to significantly cut down sea transport times between Europe and Asia, particularly in light of Russia’s reduced trade with Western nations following the Ukraine conflict. On August 14, the Velikiy Novgorod tanker was loaded with LNG from the Portovaya LNG plant on the Baltic Sea. After safely delivering 100 million cubic meters of LNG cargo, it is currently anchored near the Tangshan Caofeidian terminal in China’s Hebei province. This marks Gazprom’s inaugural use of the Northern Sea Route for LNG deliveries, a move that substantially reduces the time required for shipments to reach the Asia-Pacific region. As reported by IAA PortNews, the Velikiy Novgorod LNG tanker set sail for China in mid-August 2023 and arrived at the Tangshan port on September 14. The tanker transported approximately 100 million cubic meters of liquefied gas from the Portovaya CS on the Baltic Sea. Gazprom’s LNG production, storage, and shipment complex near the Portovaya CS commenced operations in September 2022. In May 2023, the facility achieved a noteworthy milestone by producing its first million tons of LNG. The complex boasts a design capacity of 1.5 million tons of LNG annually.

Kenera, a business division under the umbrella of KCA Deutag, has recently been awarded a contract to supply five top drive systems to a drilling contractor in Saudi Arabia. These top drive systems will be installed on new rigs destined for a significant unconventional gas project within the country. These top drive systems, designed and manufactured by Kenera’s rig equipment subsidiary, Bentec GmbH, are renowned for their operational excellence and reliability. They come equipped with proprietary software that optimizes the drilling process, ultimately reducing the time required for well delivery. Furthermore, the Bentec top drive solution benefits from Bentec rigCARE™, a digital service platform designed for remote monitoring and troubleshooting.

This achievement solidifies Kenera’s position as a vital technology partner for drilling operations in the Middle East. It builds upon a series of previously secured contracts for top drive and iron roughneck solutions in Saudi Arabia. The commissioning and support for these systems will be provided from Kenera’s newly established service center located in Dammam. Kenera is active across the Middle East, offering tailored drilling solutions, including the design of new rigs, on-demand facilities engineering services, the supply of rig equipment and components, as well as comprehensive aftermarket services.

Calgary-based Precision Drilling Corporation has announced a significant agreement to acquire all outstanding common shares of CWC Energy Services Corp. The total consideration for this acquisition is estimated at around $141 million. CWC Energy Services Corp. stands as a premier contract drilling and well servicing company with operations spanning across Canada and the United States. As a result of this transaction, Precision Drilling will expand its already extensive fleet. The additions include 62 marketed service rigs in Canada, along with seven marketed drilling rigs in the Canadian sector.

Furthermore, Precision will gain access to 11 marketed drilling rigs in the United States, encompassing seven AC triple rigs. Currently, three of the Canadian drilling rigs and seven of the U.S. drilling rigs are actively engaged in serving customers. Key highlights of this acquisition include Well-Positioned Assets: Precision will inherit well-maintained assets strategically located throughout Canada and the U.S., operating in complementary geographic regions. These assets are supported by highly skilled and experienced personnel, as well as robust customer relationships. Material Synergies: Precision anticipates annual operating synergies of approximately $20 million once the integration of CWC is complete. Additionally, Precision has identified approximately $20 million worth of excess CWC real estate that it plans to monetize following the conclusion of the transaction. Financial Benefits: Precision foresees that this transaction will be accretive on a 2024 cash flow per share basis. It will also support the company’s ongoing deleveraging plan, strengthening its financial position. Precision Drilling Corporation, known for its commitment to safety and environmental responsibility, offers the energy industry safe and environmentally responsible High-Performance, High-Value services. The company provides its customers access to a robust fleet of Super Series drilling rigs.

BP, one of the world’s largest energy companies, has made a surprising announcement regarding the resignation of CEO Bernard Looney, effective immediately. This unexpected development comes in light of Bernard Looney’s failure to provide complete disclosure of his past personal relationships with colleagues. BP has confirmed that Chief Financial Officer Murray Auchincloss, aged 52, will step in as interim CEO during this transitional period.

Bernard Looney, aged 53, assumed the role of CEO in February 2020, with a bold commitment to reshape the 114-year-old company. His vision included ambitious plans for BP to achieve net-zero emissions by 2050, coupled with substantial investments in renewable and low-carbon energy sources, as reported by Reuters. The abrupt resignation of Bernard Looney follows recent allegations of personal relationships with colleagues within the organization. These allegations prompted BP to initiate an internal investigation into the matter, which was reminiscent of a similar probe conducted by the board in May 2022. During the prior review, Bernard Looney had disclosed “a small number of historical relationships with colleagues that occurred before he assumed the role of CEO.” At that time, no violations of the company’s code of conduct were uncovered, and the board had received assurances from Bernard Looney regarding the disclosure of his past personal relationships and his commitment to future conduct. However, on Tuesday, Bernard Looney informed BP’s board that he had not provided full details of all his past relationships, ultimately leading to his resignation.