global development & trends in turkey & its neighbours & the rest of the oil and gas...
TRANSCRIPT
TURKISHPETROLEUM
TURKISH PETROLEUM
GLOBAL INSIGHT
13th TUROGE 2014ANKARA, 10 APRIL 2014
Hüseyin YAKARDeputy DirectorTURKISH PETROLEUM, STRATEGY DEVELOPMENT
Oil and Gas
10 APRIL 2014 TUROGE 2014 - GLOBAL INSIGHT 1/21
TURKISHPETROLEUM
1. TURKEY’S ENERGY OUTLOOK
2. OIL MARKET WHAT HAPPENED TO PRICES 2014 EXPECTATIONS
3. GLOBAL DEVELOPMENTS IN THE PETROLEUM INDUSTRY INVESTMENTS DISCOVERIES MERGER / ACQUISITIONS MEXICO
4. REGIONAL HOT SPOTS EASTERN MEDITERRANEAN IRAQ IRAN SHAH DENIZ, TANAP, TAP
CRIMEA
2/2110 APRIL 2014 TUROGE 2014 - GLOBAL INSIGHT
CONTENT
TURKISHPETROLEUM
1. TURKEY’S ENERGY OUTLOOK
2. OIL MARKET WHAT HAPPENED TO PRICES 2014 EXPECTATIONS
3. GLOBAL DEVELOPMENTS IN THE PETROLEUM INDUSTRY INVESTMENTS DISCOVERIES MERGER / ACQUISITIONS MEXICO
4. REGIONAL HOT SPOTS EASTERN MEDITERRANEAN IRAQ IRAN SHAH DENİZ, TANAP, TAP
CRIMEA
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CONTENT
TURKISHPETROLEUM
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TURKISH ENERGY OUTLOOK
NATURAL GAS;WHERE FROM, HOW MUCH?
2013 WHILE TOTAL IMPORTS INCREASED
SHARE OF ENERGY DECREASED
(thousand m3/$)* Projections
UNIT 2011 2012 2013* 2010-2013
GROSS DOMESTIC PRODUCT BILLION $ 722 786 826
CURRENT ACCOUNT DEFICIT BILLION $ 77 49 65
TOTAL IMPORT BILLION $ 241 237 252
TOTAL ENERGY IMPORT BILLION $ 54 60 56
OIL & GAS IMPORT BILLION $ 40 51
SHARE OF ENERGY IN TOTAL IMPORT % 23 25 22
SHARE OF OIL & GAS IN ENERGY IMPORT % 74 85
DAILY OIL CONSUMPTION THOUSAND BBL /D 673 685 706
YEARLY NATURAL GAS CONSUMPTION BILLION M3/Y 39 46 44
DAILY NATURAL GAS CONSUMPTION (OIL EQUVALENT) THOUSAND BBL OE/D 672 788 758
DEPENDENCE TO FOREIGN RESOURCES IN ENERGY %
DEPENDENCE TO OIL IN ENERGY PRODUCTION %
DEPENDENCE TO NATURAL GAS IN ENERGY PRODUCTION %
DEPENDENCE TO FOREIGN RESOURCES IN OIL %
DEPENDENCE TO FOREIGN RESOURCES IN NATURAL GAS %
DEPENDENCE TO SINGLE FOREIGN RESOURCE (RUSSIA) IN NATURAL GAS %
73
29
31
92
98
57
TURKISHPETROLEUM
1. TURKEY’S ENERGY OUTLOOK
2. OIL MARKET WHAT HAPPENED TO PRICES 2014 EXPECTATIONS
3. GLOBAL DEVELOPMENTS IN THE PETROLEUM INDUSTRY INVESTMENTS DISCOVERIES MERGER / ACQUISITIONS MEXICO
4. REGIONAL HOT SPOTS EASTERN MEDITERRANEAN IRAQ IRAN SHAH DENİZ, TANAP, TAP
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CONTENT
TURKISHPETROLEUM
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OIL PRICES
3731 31
35
46
63
7379
103
65
83
113
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
TURKISHPETROLEUM
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2014 -2015 EXPECTATIONS
DECREASE IN OIL PRICES(90 – 100 $/b)
EXPECTATION IN THE SHORT TERM(2014 – 2015)
PRODUCTION INCREASE IN US AND IRAQ
SLOW RECOVERY IN THE GLOBAL ECONOMY
EXCESS SUPPLY
THE IMPACT OF GEOPOLITICAL DEVELOPMENTS ON THE PRICES = + 20 %
SUPPLY/DEMAND BALANCE
INCREASE OF THE SUPPLY
FASTER INCREASE IN OIL SUPPLY THAN DEMANDIRAN-WEST NUCLEAR AGREEMENT
INCREASE IN VALUE OF USDCHINA’S ECONOMY LOSING MOMENTUM
GEOPOLITICAL TENSIONS
INSTABILITY IN IRAQDISRUPTION IN LIBYAN OIL PRODUCTIONSAUDI ARABIA’S PRODUCTION CUTRECOVERY ACCELERATION OF THE US ECONOMY
DECREASE IN OIL PRICES INCREASE IN OIL PRICES
TURKISHPETROLEUM
1. TURKEY’S ENERGY OUTLOOK
2. OIL MARKET WHAT HAPPENED TO PRICES 2014 EXPECTATIONS
3. GLOBAL DEVELOPMENTS IN THE PETROLEUM INDUSTRY INVESTMENTS DISCOVERIES MERGER / ACQUISITIONS MEXICO
4. REGIONAL HOT SPOTS EASTERN MEDITERRANEAN IRAQ IRAN SHAH DENİZ, TANAP, TAP
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CONTENT
TURKISHPETROLEUM
EXPLORATION & PRODUCTION INVESTMENTS
10/2110 APRIL 2014 TUROGE 2014 - GLOBAL INSIGHT
DEEPWATER UNCONVENTIONAL
CONVENTIONAL EXPLORATION INVESTMENTS INCREASING
24 27
39
52
67 66 6470
8493
46
63
7379
103
65
83
113 112 110
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
EXPLORATION INVESTMENT (BILLION $)
BRENT OIL PRICE ($/BBL)
TURKISHPETROLEUM
2013 GLOBAL TOP TEN DISCOVERIES
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Natural Gas Discovery
Egypt/BP500 mmboe
Tanzania/Statoil575 mmboe
Malaysia/NFX850 mmboe(2 discoveries)
Mozambique/ENI1.400 mmboe(2 discoveries)
Oil Discovery
Canada/Statoil450 mmbo
USA/Chevron550 mmbo
Mexico/PEMEX 500 mmboe
Congo/ENI700 mmbo
Angola/Cobalt900 mmbo
Nijeria/Afren775 mmboe
2
1
34
7
5
9
8
10
6
400 EXPLORATION WELLSCONVENTIONAL DISCOVERY: 20 BILLION BARREL OIL EQUIVALENT
GLOBAL CONSUMPTION: 50 BILLION BARREL OIL EQUIVALENT(= 137 MILLION OE/D)
TURKISHPETROLEUM
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GLOBAL RESERVES - PRODUCTION AND RPR2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
1.334 1.340 1.352 1.364 1.397 1.468 1.510 1.617 1.654 1.669
78 81 82 82 82 83 81 83 84 86
47 45 45 45 47 49 51 53 54 53
156 157 157 158 162 170 170 177 188 187
2.595 2.675 2.769 2.839 2.932 3.011 2.944 3.176 3.232 3.314
(Million barrel OE/d) 45 46 48 49 51 52 51 55 56 57
60 59 57 56 55 56 58 56 58 57
O
I
L
N
A
T
U
R
A
L
G
A
S
RESERVE TO PRODUCTION RATIO (year)
PROVED RESERVES (Billion Barrel)
PRODUCTION (Million barrel/day)
RESERVE TO PRODUCTION RATIO (year)
PROVED RESERVES (tcm)
PRODUCTION (bcm/year)
Source: BP
TURKISHPETROLEUM
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MERGERS AND ACQUISITIONS
The price paid for one barrel proved oil ($)
2011 - 2013
• CORPARATE ACQUISITION DECREASING
• ASSETS (RESERVE) ACQUISITION ON THE RISE
• COMPANIES CONCENTRATE ON THE DEVELOPMENT OF THE RESERVES PURCHASED
• OIL PRICES EXPECTED TO DECLINE AND PRICE DECREASE IN UNIT ACQUISITON COSTS
Source: IHS Herold
TURKISHPETROLEUM
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MEXICO – CONSTITUTIONAL AMENDMENTS (20 December 2013)
WHY?• ON THE USA SIDE OF THE GULF OF MEXICO VERY LARGE INVESTMENTS AND DEEP SEA EXPLORATIONS• THE FAILURE OF THE DEVELOPMENT OF THE POTENTIAL ON THE MEXICAN SIDE• PEMEX’S TECHNOLOGICAL AND ECONOMIC INSUFFICIENCY• CONTINUOUS PRODUCTION FALLING (27% REDUCTION SINCE 2004)• SINCE 2004, IN THE NORTH OF MEXICO, IN TEXAS, THE PRODUCTION INCREASED 150%• THE INCREASE OF ENERGY PRICES; CHINA HAS OVERTAKEN THE USA AS THE CENTER OF PRODUCTION
WHAT IS GOING TO BRING?• REVIVAL OF THE ENERGY SECTOR• ECONOMIC GROWTH AND EMPLOYMENT INCREASE• A NEW POSITION TO THE COUNTRY IN THE WORLD PRODUCTION PLATFORM• NEW RESOURCES TO WORLD OIL MARKET
MEXICO OPENS ITS OIL SECTOR TO FOREIGN INVESTORS (WHICH WAS NATIONALIZED SINCE 1938)
OIL RESERVE : 10 Billion Barrel
EXPECTED DEEPWATER RESERVES : 27 Billion Barrel
OIL PRODUCTION : 2,5 Million b/d
GAS RESERVE : 488 Bcma
GAS PRODUCTION : 58 Bcma
• PEMEX’S AUTONOMY• EVEN 5 MILLION $ INVESTMENT REQUIRED APPROVAL OF TREASURY• THERE WERE FIVE REPRESENTATIVES FROM THE OIL WORKERS UNION IN THE
COMPANY’S BOARD OF DIRECTORS• IT COULDN’T ESTABLISH PARTNERSHIP WITH INTERNATIONAL OIL COMPANIES
TURKISHPETROLEUM
1. TURKEY’S ENERGY OUTLOOK
2. OIL MARKET WHAT HAPPENED TO PRICES 2014 EXPECTATIONS
3. GLOBAL DEVELOPMENTS IN THE PETROLEUM INDUSTRY INVESTMENTS DISCOVERIES MERGER / ACQUISITIONS MEXICO
4. REGIONAL HOT SPOTS EASTERN MEDITERRANEAN IRAQ IRAN SHAH DENİZ, TANAP, TAP
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CONTENT
TURKISHPETROLEUM
EASTERN MEDITERRANEAN
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• DISCOVERIES IN ISRAELI OFFSHORE CONTINUE
• ISRAELI GOV’T DECIDES TO EXPORT 40 % OF GAS; BUT FINAL EXPORT DECISION STILL UPHELD
• SEVERAL EXPORT OPTIONS ON THE TABLE: EXPORTING GAS THORUGH TURKEY IS THE MOST FEASIBLE OPTION (IN THE SHORT-TERM THE USE OF EGYPT’S LNG FACILITIES ARE ON THE AGENDA)
• ISRAEL-TURKEY GAS PIPELINE PROJECT SAID TO BE ATTRACTING A LOT OF INTEREST FROM COMPANIES
• LEBANON EXPLORATION BID ROUND TO BE HELD IN 14 AUGUST 2014
• LEBANON FINALLY HAS A GOV’T BUT POLITICS CAN STILL COMPLICATE THE BID ROUND PROCESS
• SYRIA GRANTED EXPLORATION RIGHT IN ITS OFFSHORE BLOCK 2 TO RUSSIAN SOYUZNEFTGAZ
TRNCGCA
Ashdod
Haifa
Ceyhan
12
12
3
13
9
1110
87654
TURKEY
SYRIA
LEBANON
JORDAN
W. BankISRAEL
EGYPT
A B CD
E
F
G
1
4
5 6
Beirut
9
Gas Disocvery
Licence area claimed by GCA
Licences granted to TPAO by TRNC
Unratified border (Lebanon-GCA)
Egypt-GCA claimed maritime border
Israel-GCA claiemd border
No EEZs delimiation agreement
Announced blocks by Lebanon
Gaza
Block 1
Block 2
Block 3
EAST MED: WILL ECONOMICS TUNE UP POLITICS?
TURKISHPETROLEUM
RECENT DEVELOPMENTS IN IRAQ
17/2110 APRIL 2014 TUROGE 2014 - GLOBAL INSIGHT
• THE DISPUTE BEETWEEN BAGHDAD AND IRBIL CONTINUES TO PUT BURDEN ON IRAQI PRODUCTION TARGETS
• KRG TIE IN TO ITP TECHNICALLY OPERATIONAL SINCE DEC 2013
• TURKEY AWAITS THE CONTENT OF CENTRAL GOV’T FOR KURDISH EXPORTS WHICH AMOUNTED NEARLY 1,3 mmbbl IN CEYHAN PORT
• COMPANY RISKS INCREASE DUE TO SECURITY CONCERNS
• SYRIAN SPILL OVER: DEVELOPMENTS IN SYRIA FURTHER WORSENS STABILITY DUE TO WEAKENING OF THE BORDER
• IRAQI INSTABILITY INTENSIFIES BEFORE THE ELECTIONS TO BE HELD IN 30rd of APRIL 2014
IRAQ’S STABILITY MATTERS BOTH FOR REGION AND GLOBE
Kurdish/Turkman
Sunni Arab/Kurdish/Turkman
Sunni Arab
Shia/Sunni Arab
Shia Arab
PREDOMINANTLY
TURKISHPETROLEUM
FUTURE OF IRANIAN PETROLEUM INDUSTRY
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• NUCLEAR NEGOTIATIONS LIKELY TO BE PROLONGED:BUT COULD END UP THE GRADUAL ANDPERSISTANT REMOVAL OF SANCTIONS ON IRAN
• NEW GOV’T CONSIDERS REVISED BUY-BACKS:IRANIAN PETROLEUM AGREEMENT (IPA) WHICH:
• IS EXPECTED TO BE A MODEL BETWEEEN IRAQI TSCsand UKCS PSAs”
• WILL BE ANNOUNCED BY JUNE/JULY 2014
• TEHRAN IS EAGER TO ATTRACT WESTERN MAJORSPARTICULARLY TO:
• MATURE OIL FIELDS
• SOUTH PARS GAS DEVELOPMENT PROJECTS
WILL THE SLEEPING GIANT WAKE UP?
TURKISHPETROLEUM
SHAH DENIZ - TANAP - TAP
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TRANS ANATOLIA NATURAL GAS PIPELINE (TANAP) • SHARE HOLDERS: 58 % SOCAR, 30 % BOTAS, 12 % BP• Gas Flow into Turkish market : 2018, European Market: 2019• TANAP START AT TR – GEORGIA BORDER• CAPACITY: 16 bcm (6 Bcma Turkey; 10 Bcma Europe)• Lenght: 1.900 km• TANAP COST: $ 10 Billion
TRANS ADRIATIC NATURAL GAS PIPELINE (TAP)• SHARE HOLDERS : 20 % SOCAR, 20 % BP, 20 % Statoil, 16 %
Fluxys (Belgium), 10 % Total, 9 % E.On, 5 % Axpo (Switzerland)
• Operational by 2019• CAPACITY: 10 bcma (may expanded to 20 bcma)• LENGHT: 870 km• TAP COST : $ 5 Billion
SHAH DENIZ II FINAL INVESTMENT DECISION (17 DECEMBER 2013 - BAKU)
MEGA PROJECTTOTAL INVESTMENT: 45 BILLION USD
BRINDISI
SHAH DENIZ + SCPx• Statoil sold 10 % of share to BP and SOCAR• PSA extended to 2048• Decision of increase in capacity of SCP (SCPx)• Shah Deniz development + SCPx investment: $ 30 Billion
TURKISHPETROLEUM
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CRIMEAN SECESSION
• GAS TO UKRAINE AND EU ?
• SOUTH STREAM ?
• E & P ACTIVITIES IN UKRANIAN OFFSHORE ?
Nationalization/privitization of Chornomorneftegaz and Ukrtransgaz Ukrainian oil and gas reserves in Crimea
ExxonMobils and partners activities halted in Skifska field(estimated 200 to 250 bcm N. Gas; $735 Mil. Investment
• PROBABLE TERRITORIAL DISPUTES IN N. BLACK SEA ?
16TH MARCH REFERANDUM: 82% OF CRIMEA CITIZENS VOTING BY A 96% MAJORITY TO SECEDE FROM THE UKRAINE
16% (77 BCM/YEAR) OF NATURAL GAS CONSUMED IN EUROPE FLOWS
THROUGH UKRAINE
TURKISHPETROLEUM
WHILE GLOBAL ECONOMY AND TECHNOLOGICAL
DEVELOPMENTS ARE MANAGING OIL SECTOR
GLOBALY
THE BASIC DETERMINANT IS GEOPOLITICS REGIONALLY
21/2110 APRIL 2014 TUROGE 2014 - GLOBAL INSIGHT
FINAL WORDS
GLOBAL
REGIONAL