business as usual for SRC.... all staff still have their job with existing benefits atleast for few yrs to come.... this is indeed a good news for SRC and PD folks....
if convert to import facility, i bet 90% of the staff will lose their job...

low crude oil will be here to stay for a long while....unless suddenly we have 2-3 economy giants like China to take all the supply.....

Iran is preparing to flood the market with its reserve once the embargo is lift.... US is now can freely export their oil to the market as the congress just lifted the 40 yr ban.... with no sign OPEC and non OPEC countries is slowing down their production...

even OPEC manages to kill all the shale Oil companies now.... once the crude oil hits USD80-90 again then these companies will bounce back and start to drill and flood the market with shale oil...

Baker Hughes warns global rig count could fall 30 percent in 2016

Oilfield services provider Baker Hughes Inc (BHI.N), which is being acquired by Halliburton Inc (HAL.N), said it expected the number of rigs active globally to decline by as much as 30 percent in 2016 if oil prices do not recover from current levels.

Baker Hughes shares rose as much as 6 percent in early trading on Thursday, in step with oil LCOc1, which inched toward $35 on possibility of major producers co-operating to cut output. [O/R]

The worldwide rig count more than halved in 2015, meaning 2016 will be the second straight year of reduced drilling activity.

"In our opinion, BHI's management team has been the most bearish about the oil field service cycle, but has also been the most correct as the duration and severity of the downturn has continued to exceed the market's initial expectations," Barclays analysts wrote in a note.

A more than 70 percent slide in crude prices since June 2014, caused by a glut and weakening demand, has forced oil producers to mothball rigs and scale back spending.

Chief Executive Martin Craighead said "customers' challenges of maximizing production, lowering their overall costs, and protecting cash flows were now more acute."

Baker Hughes publishes the closely-watched North American rig count every week, and international rig count on a monthly basis.

The company's deal with Halliburton is facing intense regulatory scrutiny due to concerns that the merger would lead to higher prices and less innovation.

Halliburton said on Monday it was yet to reach an agreement with U.S. and European regulators about the "adequacy" of proposed divestitures.

The two companies have so far disclosed plans to divest businesses with combined 2013 revenue of $5.2 billion.

Halliburton, like bigger rival Schlumberger Ltd (SLB.N), reported a better-than-expected profit for fourth quarter, helped by deep cost cuts.

Baker Hughes' total costs and expenses fell 15 percent in the three months ended Dec. 31, but not enough to offset a nearly 50 percent drop in revenue.

The net loss attributable to Baker Hughes was $1.03 billion, or $2.35 per share, compared with a profit of $663 million, or $1.52 per share, a year earlier.

Excluding a $1.25 billion impairment charge, loss was 21 cents per share, much bigger than average analyst estimate of 10 cents per share, according to Thomson Reuters I/B/E/S.

Revenue was $3.39 billion, below Wall Street expectations of $3.47 billion.

Baker Hughes' shares were up 3 percent at $42.07 in morning trade.

BP Profit Falls 91%, Missing Estimates, as Oil Slump Deepens

BP Plc reported a 91 percent decline in fourth-quarter earnings after average crude oil prices dropped to the lowest in more than a decade. The company’s shares fell the most since August.

Profit adjusted for one-time items and inventory changes totaled $196 million, the London-based company said Tuesday. That missed the $814.7 million average estimate of 10 analysts surveyed by Bloomberg. The net loss for the year was $6.5 billion, the most in at least 30 years.

While Chief Executive Officer Bob Dudley has trimmed billions of dollars of spending, cut thousands of jobs and deferred projects in response to the plunge in crude prices, BP’s cash flow still doesn’t cover spending and dividends. The CEO said in an interview that he’s re-tooling BP to balance cash flows at below $60 a barrel. The slump has driven BP’s market value below $100 billion for the first time since the Gulf of Mexico oil spill in 2010.

“It’s very disappointing,” Ahmed Ben Salem, oil and gas analyst at Oddo & Cie in Paris, said by phone. “We were expecting lower profit from upstream, but not a loss. The dividend payout is probably safe for this year, but if oil stays around $30 then they would have to cut capex further.”

Profit has been lower year-on-year for six consecutive quarters as oil prices tumbled. The average price of benchmark Brent crude slumped 42 percent in the fourth quarter from a year earlier to $44.69 a barrel, the lowest since 2004.

BP’s shares slumped as much as 7.8 percent and traded at 338.65 pence as of 9:37 a.m. in London, giving it a market value of $90 billion. The stock has declined 3.6 percent this year following last year’s 14 percent retreat. It is still the third-best performer on the eight-member FTSE 350 Oil & Gas Producers Index.

PetroChina Co. said last week it expects 2015 profit to fall at least 60 percent. Chevron Corp. on Friday reported its first quarterly loss since 2002, while Royal Dutch Shell Plc said last month that fourth-quarter profit is likely to drop at least 42 percent. The European oil major is scheduled to report full earnings on Thursday.

BP started cutting costs and selling assets following the 2010 oil spill. In October, it lowered its 2015 capital-spending forecast to about $19 billion after investing about $23 billion in 2014. The company said then it expects to spend $17 billion to $19 billion a year through 2017.

BP, which earlier said it plans to reduce its oil and gas exploration and production workforce by 4,000 people this year, will also cut 3,000 jobs in downstream businesses by 2017.

The company’s adjusted loss from the upstream, which includes oil and gas exploration and production, was $728 million in the quarter, compared with a profit of $2.2 billion a year earlier. Earnings from downstream, made up of refining, chemicals and trading, were $1.2 billion, similar to a year earlier and 48 percent lower than the preceding quarter.

The company expects refining margins in the first quarter of 2016 to be lower than the previous three months. Refining countered declining profit from crude oil and natural gas sales for much of 2015 as demand stayed high. A mild winter has curbed demand for some fuels including heating oil, narrowing margins and putting further pressure on companies such as BP and Shell.

The company’s ratio of net debt to equity jumped to 21.6 percent at the end of 2015, an increase of almost five percentage points from a year earlier. BP’s aim is to maintain the net debt ratio at about 20 percent and for it to be above that level while oil prices remain weak, according to a statement.

“I’m very comfortable with 21 percent net gearing right now,” CEO Dudley said in a Bloomberg television interview. “We’ll be flexible around the gearing levels, we’ll see what oil prices do.”

The company’s debt level is rising and BP was among several major oil producers given a negative credit outlook by Standard & Poor’s Monday.
BP maintained its quarterly dividend at 10 cents a share and reiterated its commitment to sustain it throughout the downturn.

The company’s capital expenditure last year was $18.7 billion compared with about $23 billion the previous year. Barclays Plc analyst Lydia Rainforth said the BP could reduce that further to $14 billion if oil stays at about $40 a barrel. That would allow the company to balance its books by 2018 and still maintain dividend payouts to shareholders, she said.

“A painful fourth quarter does not bode well for the first quarter for BP,” William Hares, a London-based analyst with Bloomberg Intelligence, wrote in a report. “Downstream operations become less of a safety net for weak upstream results” for BP and its peers in early 2016, he said.

Chevron posts first loss since 2002 on crude oil plunge

Jan 29 Chevron Corp reported its first quarterly loss in more than 13 years on Friday despite Wall Street's expectations for a profit, as plunging oil prices eroded profitability across all its divisions.

It was the latest sign that the more than 70 percent drop in crude prices since 2014 has humbled a once-strong energy sector and forced it to curtail new projects, lay off staff and shrink spending.

Chevron, the No. 2 U.S. oil producer, last month signaled its pain by cutting its 2016 budget by 24 percent to $26.6 billion, part of a strategy to contend with lower oil prices and hunker down for a hoped-for price rebound.

Smaller rivals Hess Corp, Continental Resources and Noble Energy cut their own budgets early this week, ranging from 40 percent to 66 percent.

"We're taking significant action to improve earnings and cash flow in this low price environment," John Watson, Chevron's chief executive, said in a press release.

The company posted a fourth-quarter net loss of $588 million, or 31 cents per share, compared with a net profit of $3.47 billion, or $1.85 per share, in the year-ago period.

The last time Chevron posted a quarterly loss was the third quarter of 2002.

Analysts at Wells Fargo had expected the San Ramon, California-based company to report a profit of 45 cents per share, while analysts at Barclays had expected a profit of 32 cents a share.

Wells Fargo analyst Roger Read attributed the miss to higher exploration expenses and weak operating results in the company's U.S. exploration and production unit.

The bulk of Chevron's losses came from its divisions that explore for and produce oil and natural gas, with its U.S. division alone posting a loss of $1.95 billion.

Surprisingly, Chevron's refining divisions also saw profit plunge. Refiners typically see profitability increase when the price of their main feedstock - oil - falls. Chevron said the drop was due to a boost in the prior year from asset sales, and also smaller margins on specialty refined products.

Production rose 4 percent to 2.67 million barrels of oil equivalent per day in the quarter ended Dec. 31.

Shares of Chevron have slid about 5 percent so far this year through the Thursday close of $85.92 per share. On Friday, the stock traded 1.5 percent lower at $84.62. (Reporting by Ernest Scheyder Editing by W Simon)

Exxon's profit tumbles 58 percent, slashes capex by one-quarter

(Reuters) - Exxon Mobil Corp (XOM.N) on Tuesday reported its smallest quarterly profit in more than a decade and said it will cut 2015 spending by one-quarter and suspend share repurchases as it copes with a prolonged downturn in crude prices.

Shares of Exxon, the world's largest publicly traded oil company, fell 2.2 percent in premarket trading to $74.59, hit by a more than 4 percent slide in the price of crude oil.

Crude oil prices have dropped about 70 percent from the 2014 high over $100 barrel. Current prices at around $30 barrel have triggered a wave of spending cuts as oil companies slash investment in new wells and projects to conserve cash.

Exxon sees capital spending at around $23.2 billion this year, a 25 percent drop from 2015.

“While our financial results reflect the challenging environment, we remain focused on the business fundamentals, including project execution and effective cost management,” Rex Tillerson, the chairman and chief executive officer, said in a statement.

In another move to conserve cash, Exxon suspended its share buyback plan in the first quarter. In the fourth quarter, Exxon purchased 9.4 million shares for $754 million.

Oil analyst Brian Youngberg at Edward Jones in St. Louis characterized Exxon's report as "relatively good, especially when compared with BP's terrible results." He noted that Exxon's oil and gas output was better than expected and that the company had improved its operations this year.

Earlier Tuesday, BP Plc (BP.N) reported an annual loss of $6.5 billion, its largest ever. Smaller U.S. rival Chevron Corp (CVX.N) last Friday also reported a net loss.

Irving, Texas-based Exxon reported that fourth-quarter profit tumbled to $2.78 billion, or 67 cents per share, from $6.57 billion, or $1.56 per share, in the same period a year earlier. The 2015 fourth-quarter profit was the smallest since September 2002.

Analysts, on average, expected Exxon to earn 63 cents per share, according to Thomson Reuters I/B/E/S.

Exxon said its oil and gas output rose 4.8 percent in the fourth quarter as it pumped more crude oil.

if you think only MY shipyards are affected by the crisis....


Keppel axes over 6,000 O&M workers as contracts dry up

It needs to rightsize to stay afloat.

Keppel Corporation’s shrinking staff numbers paint a disheartening picture of its battered offshore and marine segment. In its latest earnings presentation, Keppel reported that it has let go of about 6,000 direct staff in its local and overseas yards since January 2015, in a bid to slash costs and optimise its current operations.

Meanwhile, the size of its Singapore subcontract workforce has dropped by about 7,900 workers, representing a fourth of Keppel O&M’s subcontract employees.

Keppel suffered a wave of contract deferrals in the past year. It started the 2015 with the expected deliveries of 15 drilling jackup rigs, but eight of these have since been pushed into 2016.

“Bracing ourselves for a possibly long winter, we need to ensure that our overheads are well under control and that we are ready if the market conditions get tougher. We are preparing ourselves to meet the near term challenges by rightsizing our operations and resources,” said Keppel CEO Loh Chin Hua at the group’s earnings presentation.

Although Keppel is focussed on reducing costs, Loh stressed that it is still investing prudently in R&D as well as improving its productivity and core competencies.
“The storm hitting the offshore and marine business is not one which we are unfamiliar. Keppel had braved through many cycles, emerging stronger and more resilient each time,” Loh said.

in 2013, Keppel completed and delivered 21 offshore rigs to customers and booked a place in Guinness World record book.... see how bad they becoming now..

still ok mah....got increment plus still have bonus as usual .... calculate back also average 2.5 months bonus...

Petronas, Dialog abort project

PETALING JAYA: Petroliam Nasional Bhd (Petronas), Dialog Group Bhd and Australia-based petroleum company Roc Oil Co Ltd have aborted a proposed project estimated to cost more than RM3bil to develop and produce petroleum off Bintulu, Sarawak.

In a filing with Bursa Malaysia, Dialog said the small-field risk service contract to develop the Balai cluster fields was terminated due to the difficult business environment and persistently depressed oil price.

The oil and gas-based technical services provider said BC Petroleum Sdn Bhd – which is 32% owned by its unit Dialog D&P Sdn Bhd, 48% by Roc Oil Malaysia (Holdings) Sdn Bhd and 20% by Petronas Carigali Sdn Bhd – had ceased operation and had on Wednesday signed a termination by mutual agreement with Petronas.

The risk service contract, which was terminated effective Dec 1, 2015, had been signed by Dialog D&P, Roc Oil and Petronas Carigali with Petronas on Aug 16, 2011 and was subsequently novated to BC Petroleum.

The contract’s development and pre-development phases were estimated to cost US$850mil to US$950mil (RM3.49bil to RM3.91bil).

With the termination of the contract, BC Petroleum will receive the balance of the capital expenditure reimbursement within the first half of 2016.

Dialog said its total losses amounting to about US$10mil (RM41mil) had been substantially provided for in the group’s financial results.

“As such, the termination is not expected to have any material effect on the earnings, net assets and gearing of Dialog for the current financial year ending June 30, 2016,” it said.

The termination of the contract does not require approvals from the relevant authorities and the shareholders of Dialog, and has no effect on the share capital and substantial shareholders’ shareholdings in Dialog.

Dialog closed higher by four sen or 2.61% to RM1.57 yesterday.

Petronas has to do it Shell style.... retrench 7200 in 2015 and 2800 in 2016....... they only approved 4 major capex projects in 2015 which only 1 for upstream...

Iran was OPEC second biggest producer before hit by international sanction in 2012.... they fought for years to lift the sanction... no way they will self impose sanction to their output by freeze the production level.... in fact, Iran is preparing to add additional million barrels of oil to the market..... Samething to Iraq as well...

not to forget that the US congress just lifted the 40 yrs export ban as well..... now Shale explorers are freely to sell their crude to international buyers....

interesting article about Iranian oil production...

since crude oil price dropped to 90s level but our cost still remain in 2015 level... u need cheap labor for O&G companies to bring the cost back to 90s level and survive...

Bangla taking courses for passport laut

UMW Oil & Gas sinks into the red in FY15

KUALA LUMPUR: UMW Oil & Gas Bhd swung into the red in the financial year ended Dec 31, 2015 due to whopping losses in the fourth quarter after an asset value write-down and goodwill written off amounting to RM337.5mil.

The company said on Tuesday the losses were also due to a one-off five-yearly asset write off, primarily resulted in the 2015 financial performance.

FY15 net losses were RM362.30mil compared with net profit of RM251.99mil in FY14. Its revenue fell 17.2% to RM839.52mil from RM1.014bil.

“The group registered a loss before tax of RM349.39mil for FY15 as opposed to the profit before tax of RM284.15mil in FY14,” it said.

In the fourth quarter, UMW O&G posted net losses of RM409.13mil versus net profit of RM71.96mil a year ago. Revenue shrank to RM130.96mil from RM326.23mil. Loss per share was 18.92 sen compared with earnings per share of 3.33 sen.

It attributed the losses in Q4 FY15 to asset and goodwill impairment losses of RM337.7 million, five-yearly asset write off of RM12.6 million and translation loss arising from the weakening of US dollar against the Ringgit, mainly contributed to the negative results in the fourth quarter of 2015

Commenting on the FY15 results, the company said the weaker performance was due to lower revenue from both the drilling services and the oilfield services segments. Overseas operations contributed approximately 49.8% of the group revenue for FY15.

Drilling services segment

The drilling services segment contributed revenue of RM802.3million or 95.6% of the total revenue of RM839.5mil for FY152015, down 17.2% from the RM968.6mil in 2014.

It said the fall in revenue was due to reduced time charter rates as well as low utilisation of some of the assets in the group.

The shortfall was however, mitigated by additional revenue contributions from three new assets, UMW NAGA 6, UMW NAGA 8 and UMW NAGA 7, which commenced operations in the months of October 2014, September 2015 and November 2015, respectively.

It also recorded translation gains from the appreciation of US dollar against the Ringgit.

UMW O&G’s drilling services segment incurred a loss of RM386.5min for FY15 compared to RM272.8mil profit before tax in 2014.

The loss was mainly due to lower time charter rates; lower utilisation rates achieved by some of the assets in the group due to five-yearly special periodical survey or idling in between contracts.

Other factors were pre-operating expenses of two new rigs which started in September and November 2015; and the asset and goodwill impairment loss of RM344.1 million as well as asset write off from the five-yearly special periodical survey.

Oilfield services segment

For FY15, the oilfield services segment contributed revenue of RM37.2mil or 4.4% of the total revenue of RM839.5mil, down RM9.1mil or 19.7% over the RM46.3mil in 2014.

Low demand for OCTG threading and repair services recorded by the Group’s operations in Labuan, Thailand and China, mainly contributed to the revenue decrease.

The oilfield services segment recorded a loss before tax of RM4mil for FY15, down RM12.8mil over the RM8.8mil profit in 2014.

UMW O&G cited lower profit contributions from the group’s operations in Labuan, Thailand and China as well as impairment of goodwill amounting to RM6.2mil, accounted for the reduction.

deleted since someone posted the news already

This post has been edited by sukhoi35mk: Feb 24 2016, 10:16 AM

i know downstream is booming now..... every supermajor is doing very well in DS but upstream losses pull their profit down
alot of upgrade works going on now especially Distribution sector .... O&G is not only abt upstream

Petronas trying to peg Malaysian crude oils?

1000 just the beginning i guess... like Shell, every yr also slashing thousand of jobs..