Total chief predicts US shale oil industry to see wave of investment

Patrick Pouyanne, CEO of Total. (Reuters)
Updated 18 October 2017
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Total chief predicts US shale oil industry to see wave of investment

LONDON: The US shale industry will see another wave of investment as producers are betting strongly against a fall in oil prices, the CEO of Total, Patrick Pouyanne, said on Wednesday.
Speaking at the Oil & Money conference in London, he said he expected global oil demand to grow strongly again this year, by up to 1.6 million barrels per day (bpd).
“Our US colleagues are hedging like mad at $56 a barrel so we will see another wave of investment in US shale, no doubt about it,” Pouyanne said.
A sharp fall in investment since oil prices collapsed in 2014 has led to a drop in development of new projects, which could spark an oil supply shortage after 2020, Pouyanne said.
Pouyanne said the rate of final investment decisions (FIDs) in exploration and production had shrunk too much since 2015.
“The number of FIDs from 2010-2014 averaged 35 FIDs per year ... to add potentially 2.5 million bpd,” he said.
“Since 2015, it’s 12 per year to add 1 million bpd — that’s probably not enough. Post-2020, we will face an issue with these lower numbers of FIDs. It takes time to bring new capacity to production.”
He later said Total expects to give a green light by the year-end for the development of the Libra offshore field in Brazil, which will produce up to 150,000 bpd.
On the OPEC side, the oil chief sees Russia and Saudi Arabia extending production cuts.
OPEC and several non-OPEC producers agreed late last year on a six-month output-cutting deal from January to tackle a global glut. The deal has been extended until March 2018.
A visit by the Saudi king to Moscow recently “is a clear signal (that) it is in the interest of both countries to support the market. I will not be surprised to see the extension,” Pouyanne said.


Once mighty US retailer Sears files for bankruptcy

Updated 15 October 2018
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Once mighty US retailer Sears files for bankruptcy

  • Sears had been drowning in debt and reportedly could not afford a $134 million repayment
  • Started in 1886, the company was a pioneer of departmental stores that catered to everyone

WASHINGTON: Sears, the venerable US chain that once dominated the retail sector but had been in decline since the advent of the Amazon era, filed for bankruptcy Monday and announced it was closing almost 150 stores.
With a history that stretches back to 1886, the company was a pioneer of departmental stores that catered to everyone and by the mid-twentieth century had built a vast empire that stretched across North America.
But it has closed hundreds of outlets in recent years amid a retail shakeout caused in part by the rise of Amazon and other e-commerce players.
“The Company and certain of its subsidiaries have filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the US Bankruptcy Court for the Southern District of New York,” a statement by Sears Holdings Corporation said.
Sears had been drowning in debt and reportedly could not afford a $134 million repayment that had been due on Monday.
Edward S. Lampert, Chairman of Sears Holdings, said the insolvency filing would give the company the “flexibility to strengthen its balance sheet” and enable it to accelerate a strategic transformation.
The company said it intended to reorganize around a smaller store platform, a strategy it said would help save tens of thousands of jobs.
But it announced it would close 142 unprofitable stores near the end of the year, in addition to the previously announced closure of 46 stores by November.
While retaining his chairmanship, Lampert will step down as CEO, with the role handled by other senior executives as part of a new “Office of the CEO.”
Sears added it had received commitments for $300 million in debtor-in-possession financing and was negotiating for an additional $300 million.
Sears is far from the only brick-and-mortar outlet to fall by the wayside as more consumers do the bulk of their shopping online.
In March, iconic Toys “R” Us announced it was shuttering all of its US outlets while other big names such as Macy’s and JC Penney have also been forced to close numerous locations and lay off workers.
American shopping malls in turn have been forced to turn to a new generation of stores, food and entertainment including players that began online, as well as gyms and video game bars like Dave & Buster’s.