Natural Gas Daily: October 21st, 2020

PIONEER TO BUY PARSLEY IN $4.5BN STOCK DEAL

Pioneer Natural Resources will buy fellow Permian basin producer Parsley Energy for $4.5bn in stock, the companies announced on October 20, marking the latest in a series of mergers and acquisitions (M&A) deals in the struggling US shale industry.

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• Earlier this week ConocoPhillips  announced it would build up its Permian business through the takeover of Concho Resources. Chevron also expanded in the Permian and other US shale areas when it completed the acquisition of Noble Energy in early October.

UGANDA CLEARS TULLOW SALE TO TOTAL

Uganda's government has approved London-listed Tullow Oil's sale of its interests in the country's Lake Albert development to France's Total for $575mn, Tullow said. It aims to raise $1bn from asset sales to shore up its weak finances, expects the deal's completion in a few days. 

• The government and its revenue authority have also agreed on the tax treatment of the transaction, first announced in April.

   

GAS MEETS HALF GERMAN INDUSTRY'S POWER DEMAND

Natural gas is becoming more important in German industry, especially for power generation, gas lobby group Zukunft Erdgas said. Citing figures from the federal statistical office, ZE said gas "now accounts for 50% of the electricity generated by industry."

• Industry needs natural gas as feedstock for hydrogen, hydrocyanic acid or ammonia production, as well as fuel to generate heat and electricity. 

• Gas will continue to represent a significant proportion of the energy supply in Germany, but also the EU as a whole, well into the future.

SPAIN'S ENAGAS SEES UPTICK IN 9M PROFITS

Spanish gas transmission system operator Enagas achieved a 4.7% growth in net profits in the first nine months of the year to €349mn ($413mn), the company said on October 20. 

• On the market's recovery, Enagas noted that conventional gas demand had returned to pre-pandemic levels in September.

• Enagas will get a boost from the launch of the Trans-Adriatic Pipeline (TAP) that will bring Azeri gas to southeast Europe, in which it has a 16% stake.

NYK CONDUCTS JAPAN'S 1ST SHIP TO SHIP LNG BUNKERING

LNG bunkering vessel Kaguya supplied LNG to a pure car and truck carrier (PCTC) owned by Japanese shipping company NYK at Shin Kurushima Toyohashi Shipbuilding, NYK said. This is the first time in Japan that LNG was supplied to a vessel via ship-to-ship bunkering. 

• Japan is the world's biggest LNG importer. The country's LNG imports in September were 6.5mn metric tons, up 1% yr/yr, according to the provisional data released by the country’s finance ministry on October 19.

POLAND TO BUY DANISH GAS FROM ORSTED

Polish state monopoly PGNiG Supply & Trading has added Denmark to its list of suppliers, announcing a medium-term gas supply contract with Danish Orsted. The contract covers about 6.4bn m³ over almost six years, starting January 1 2023 and expiring October 1 2028.

• The gas, some of which will come from the Tyra field which operator Total is now redeveloping, can reach the Polish or German markets through the Baltic Pipe, which will also carry Norwegian gas and which is under construction, or the Denmark-Germany onshore link.

• Danish gas production is expected to be 3bn m³ in 2024 and Tyra is expected to be operational once more in 2022.