AFRICA

Nigeria’s state oil firm will split into 30 companies
Nigerian National Petroleum Corp. (NNPC) was scheduled to be split into 30 independent companies in March in restructuring designed to help tackle corruption at the state oil company, Reuters reported. Mismanagement and graft at NNPC has hampered an industry that provides about 70% of national income in Africa’s biggest crude producer. Plans to break up the company are part of efforts to dismantle opaque structures that enabled theft.

ASIA

Petronas to cut about 1,000 positions after strategic review
Malaysia’s Petronas is making about 1,000 positions redundant and is reshuffling some senior executives after a strategic review, as the state-owned oil and gas company tries to cope with the hit from a plunge in oil prices, a Reuters report stated. Petronas is one of the biggest employers of Malaysians and has a staff of about 51,000 people, according to its 2014 annual report. The company also makes up about one-third of the Malaysian government’s oil and gas revenue. The company recently posted a quarterly net loss and confirmed plans to cut spending by $12 billion over the next four years. Petronas said in a statement on its website on March 1 that it was making efforts to redeploy employees affected by the redundancies.

EUROPE

Total, Eni bet on new finds
As oil firms slash billions of dollars of investment to survive the market crash, France’s Total and Italy’s Eni are making some of the smallest cuts, gambling on the hope of big-ticket discoveries that will reward them when prices recover, Reuters reported. Wood Mackenzie analysts expect this year’s exploration spending to fall to just half of a peak of $95 billion reached in 2014. Against that background, Total’s 21% cut is among the smallest. Total will still spend $1.5 billion on exploration this year, including off Myanmar, Argentina and Nigeria. Eni has not published separate exploration budget numbers for 2016 but said it will keep seeking new resources in mature areas where it can use existing infrastructure and know-how to lower costs. Eni became the first big oil firm last year to cut its dividend to navigate the market downturn. Its bet on finding new resources was boosted last year when it made the bumper Zohr gas discovery offshore Egypt, the biggest ever in the Mediterranean and its fifth large oil and gas find in just three years, giving it the best track record in reserve replacement among majors, according to Eni.

MIDDLE EAST

McDermott wins offshore project in Middle East
McDermott International Inc. has been awarded a large contract by an upstream oil and gas operator for a project offshore in the Middle East, the company said in a news release. Work will include engineering, procurement, fabrication, transportation and installation of offshore pipelines. McDermott said engineering and offshore mobilization of its in-house vessels has begun for this fast-track assignment. Project completion is expected by year-end 2016. The contract award will be reflected in McDermott’s first-quarter 2016 backlog.

Genel halves reserves estimate for Iraqi Kurdistan Field
Genel Energy Plc, one of a handful of foreign oil producers in Iraqi Kurdistan, lost more than one-third of its market value on Feb. 29 after the company halved the reserves estimate for its largest operational field, according to a Reuters report. The company said it expected to write down the value of its holding in the Taq Taq Field by $1 billion, blaming a steep fall in oil prices and lowered expectations of reserves. Genel estimated that Taq Taq had proven and probable reserves of 356 MMbbl of oil as of Dec. 31. The slashing of reserves estimate will put more pressure on the company, which already is struggling with oil prices at their multiyear lows and millions in debt owed by the Kurdistan Regional Government (KRG) for oil exports. In early February, the company told Reuters it would resume drilling at Taq Taq in the coming weeks to ramp up production. In January Genel said it was reviewing its reservoir model and investment profile for Taq Taq after seeing some production declines at the field last year. Since 2011, Taq Taq has produced 184 MMbbl on a gross basis. Genel kept its full-year production forecast of 60,000 bbl/d to 70,000 bbl/d of oil but said that Taq Taq production would fall to 50,000 bbl/d to 70,000 bbl/d by 2018, from the about 80,000 bbl/d expected for 2016. Genel has a 44% interest in Taq Taq, and a unit of China Petroleum and Chemical Corp. holds 36%, with KRG holding the remaining.

NORTH AMERICA

Chevron plans to slash budget in next two years
Chevron Corp. said it will slash its budget by at least 17% for the next two years as it finishes construction on major expansion projects and works to save cash as oil prices sit near 10-year lows, Reuters reported. The company plans to spend $17 billion to $22 billion annually in 2017 and 2018. For 2016, the company announced it would spend $26.6 billion. Executives reiterated the company’s commitment to pay its $1.07 quarterly dividend.

DOJ sends request for Exxon probe to FBI
The Department of Justice (DOJ) asked the Federal Bureau of Investigation (FBI) to evaluate whether Exxon Mobil violated federal laws by publicly denying climate change for years, The Huffington Post reported. Reps. Ted Lieu and Mark DeSaulnier, both Democrats from California, asked the DOJ to investigate Exxon last fall after reporting from Inside Climate News and The Los Angeles Times indicated that Exxon’s experts knew about the dangers of burning fossil fuels and still publicly worked to undermine climate science. In a letter to Attorney General Loretta Lynch in October 2015, the congressmen asked the department to look into whether Exxon violated federal laws such as the Racketeer Influenced and Corrupt Organizations, or RICO, Act by “organizing a sustained deception campaign disputing climate science and failing to disclose truthful information to investors and the public.” The DOJ responded in a letter stating it had forwarded the matter to the FBI’s Criminal Investigation Division to conduct initial fact-finding and “determine whether an investigation is warranted.” Lieu also asked the Securities and Exchange Commission to investigate whether Exxon broke any laws in its filing to the commission. Exxon stated the reporting on their climate work mischaracterizes its position. The company has included information about the business risk of climate change in its security filings and shareholder reports for “many years,” Exxon spokesman Alan Jeffers said via email. “Media and environmental activists have used publicly available materials from the company’s archives to deliberately distort Exxon Mobil’s nearly 40-year history of climate research, which was conducted publicly in conjunction with the Department of Energy, academics and the U.N. Intergovernmental Panel on Climate Change. To suggest that we had reached definitive conclusions, decades before the world’s experts and while climate science was in an early stage of development, is not credible.”

SOUTH AMERICA

Lula targeted in police raid into corruption scandal
Brazil’s former President Luiz Inacio Lula da Silva said his detention on March 4 was a politically motivated media spectacle, vowing to fight charges in this corruption scandal, Bloomberg reported. Prosecutors said they have evidence that companies rewarded him with donations and speaking fees in return for government favors. Reuters reported the country’s federal police detained him for questioning in an investigation of a bribery and money laundering scheme that they said had financed campaigns and expenses of the ruling Workers Party. Lula denied allegations of wrongdoing and accused prosecutors of abusing their authority to weaken him politically.

Rosneft will invest another $500 million in Venezuela Energy Project
Rosneft plans to invest another $500 million as it raises its stake in the Petromonagas joint venture (JV) in Venezuela’s Orinoco Belt region to 40%, President Nicolas Maduro said in February, according to a Reuters report. That is the maximum stake foreign partners are allowed to hold in JVs with Venezuelan state oil firm PDVSA. Rosneft originally had a 16.7% stake in the Petromonagas JV. Reuters reported last June that PDVSA and the Russian oil major were negotiating a financing deal under which Rosneft would lend its South American counterpart $5 billion, a source close to the negotiations said.