Over the last few years, Moscow has become Venezuela’s lender of last resort…

According to Reuters calculations based on PDVSA data, the Caracas-based company delivered around 463,500 bpd to Chinese firms between January and August, a roughly 60 percent compliance rate. That compares with around 176,680 bpd to Russian entities, or a 40 percent compliance rate.

Exclusive: Rosneft's Sechin flies to Venezuela, rebukes Maduro over oil shipments

Over the last few years, Moscow has become Venezuela's lender of last resort, with the Russian government and Rosneft handing Venezuela at least $17 billion in loans and credit lines since 2006, according to Reuters calculations. 

Sechin handed Maduro graphics about oil shipments to Russian entities compared with China, the two sources said.

Top financier China, which has ploughed more than $50 billion into Venezuela, also gets reimbursed in oil.

According to Reuters calculations based on PDVSA data, the Caracas-based company delivered around 463,500 bpd to Chinese firms between January and August, a roughly 60 percent compliance rate. That compares with around 176,680 bpd to Russian entities, or a 40 percent compliance rate.

Rosneft and PDVSA did not immediately respond to a request for comment.

One of the sources with knowledge of Sechin's visit, as well as two separate sources, said a Chinese delegation was also in Caracas this week.

As of early 2017, PDVSA began to fall months behind on shipments of crude and fuel under the loan deals with China and Russia due to problems in its oil industry, home to the world's biggest crude reserves, according to documents reviewed by Reuters.

The problems include operational mishaps, such as refining outages and delayed cleaning of tanker hulls, and financial disputes with service providers owed money by PDVSA.

This April, Rosneft and PDVSA signed a refinancing agreement designed to allow the Venezuelan company to catch up on delayed loan payments by delivering more crude to Rosneft. Under the refinancing, PDVSA has to provide Rosneft with some 380,000 bpd, up from around 310,000 bpd, according to Reuters calculations.

The Russian company was planning on using Jose's South dock to pick up the cargoes, before an August tanker collision delayed exports to Rosneft. PDVSA reopened the dock earlier this month, sources said.

China agreed to use ship-to-ship (STS) operations to avoid Venezuela's clogged ports. However, the clients to whom Rosneft sends Venezuelan crude, Russian-backed Indian refiner Nayara Energy and Indian conglomerate Reliance, did not agree to STS transfers, likely heightening delays.

Exclusive: Rosneft's Sechin flies to Venezuela, rebukes Maduro over oil shipments

#Texas Is About to Create #OPEC's Worst Nightmare #Oil #OOTT

"The Permian will continue to grow and OPEC needs to learn to live with it"

"You've got an awful lot of production that can come in very economically" 

Texas Is About to Create OPEC's Worst Nightmare

Javier BlasNovember 21, 2018, 12:00 AM EST

In less than a decade, U.S. companies have drilled 114,000 wells. Many of them would turn a profit even with crude prices as low as $30 a barrel.

OPEC's bad dream only deepens next year, when Permian producers expect to iron out distribution snags that will add three pipelines and as much as 2 million barrels of oil a day.

"The Permian will continue to grow and OPEC needs to learn to live with it,'' said Mike Loya, the top executive in the Americas for Vitol Group, the world's largest independent oil-trading house.

The U.S. energy surge presents OPEC with one of the biggest challenges of its 60-year history. If Saudi Arabia and its allies cut production to keep prices higher, shale will thrive, robbing them of market share. But because the Saudis need higher crude prices to make money than U.S. producers, OPEC can't afford to let prices fall.

Cartel Squeezed

So the cartel finds itself squeezed between the-sky's-the-limit U.S. output and softer demand growth. The 15 members, and allies including Russia, Mexico and Kazakhstan, will discuss the possibility of their second retreat from booming American production in three years when they gather Dec. 6 in Vienna.

OPEC helped create the monster that haunts its sleep. After it flooded the market in 2014, oil prices crashed, forcing surviving U.S. shale producers to get leaner so they could thrive even with lower oil prices. As prices recovered, so did drilling.

...

Price Tumble

"You've got an awful lot of production that can come in very economically,'' said Patricia Yarrington, Chevron Corp.'s chief financial officer. "If you think back four or five years ago, when we didn't really understand what shale could do, the marginal barrel was priced much higher than what we think the marginal barrel is priced today.''

That shift makes shale resilient to a price tumble. After touching a four-year high in October, West Texas Intermediate, the U.S. benchmark, has fallen by more than 20 percent.

Only a few months ago, the consensus was that the Permian and U.S. oil production more widely was going to hit a plateau this past summer. It would flat-line through the rest of this year and 2019 due to pipeline constraints, only to start growing again -- perhaps -- in early 2020.

If that had happened, Saudi Arabia would've had an easier job, most likely avoiding output cuts next year because production losses in Venezuela and sanctions on Iran would have done the trick.

Instead, August saw the largest annual increase in U.S. oil production in 98 years, according to government data. The American energy industry added, in crude and other oil liquids, nearly 3 million barrels, roughly the equivalent of what Kuwait pumps, than it did in the same month last year. Total output of 15.9 million barrels a day was more than Russia or Saudi Arabia.

Read the rest of the story here: https://www.bloomberg.com/amp/news/articles/2018-11-21/opec-s-worst-nightmare-the-permian-is-about-to-pump-a-lot-more?

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Hammerhead-1, @ExxonMobil’s, @Hess’ 9th discovery in #Guyana, ‘thickest single sand package’ on #Stabroek Block

Hammerhead could jump the queue in terms of being ahead of some of the other phases on  the Stabroek Block– Hess

Extremely Positive for Guyana and Canje

OilNOW 0

November 1, 2018

The Hammerhead-1 well, where approximately 197 feet (60 meters) of high-quality, oil-bearing sandstone reservoir was encountered by the Stena Carron drillship in August offshore Guyana is the 'thickest single sand package' drilled on the Stabroek Block, according to President and Chief Operating Officer of Hess Corporation, Gregory P. Hill.

Hess has a 30 percent stake in the Stabroek Block where ExxonMobil affiliate Esso Exploration and Production Guyana Ltd. is operator with 45 percent interest and CNOOC Nexen has 25 percent.

Speaking on a 3^rd quarter earnings call on Wednesday, Hill said Hammerhead is a massive accumulation and very thick sand package. "In fact, it's the thickest single sand package that we drilled on the block. It's a very large structure so it's going to require some additional appraisal. What we can say is that the results of the DST were good, meaning that the reservoir quality is excellent and the reservoir seems to be well-connected."

He was at the time responding to a question from Doug Leggate – Bank of America Merrill Lynch, who queried about the company's plans to potentially fast-track Hammerhead to development stage. Leggate also wanted to confirm that the Hammerhead discovery was an addition to the already estimated volume of more than 4 billion barrels of recoverable oil found on the block.

"You're right to say that Hammerhead's accretive to the 4 billion barrels and it could jump the queue in terms of being ahead of some of the other phases that were on the Turbot cluster, but it's too early to say that because we need some additional appraisal before we make that final decision. But, again, it is accretive to the 4 billion barrels," Hill said in response.

Hammerhead-1, which accounted for ExxonMobil's 9^th discovery in Guyana, was safely drilled to 13,862 feet (4,225 meters) depth in 3,373 feet (1,150 meters) of water.