Qatar Airways says it may switch part of A350 order to biggest model

Airbus Chief Operating Officer President Fabrice Bregier and Qatar Airways Chief Executive Akbar Al-Baker hold a scale model of a Qatar Airways Airbus A350-1000 during a news conference. (REUTERS)
Updated 20 February 2018
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Qatar Airways says it may switch part of A350 order to biggest model

TOULOUSE: Airbus got a boost for its largest twin-engined jet on Tuesday when Qatar Airways said it was considering upgrading some of its A350 orders to the largest model as it took delivery of the first such plane.
The A350-1000 is designed to seat 366 people and competes head-to-head with Boeing’s profitable 777. The first A350-1000 was handed over to the Gulf carrier on Tuesday, joining the smaller A350-900, which has been in service for three years.
Airbus says the lightweight A350-1000 is 25 percent more efficient than the most popular current version of the 777, the 777-300ER.
But sales of the 777-300ER have picked up, and Boeing is working on plans to leapfrog the A350-1000 with an upgraded 777X boasting over 400 seats.
Boeing last year sold 32 777-300ERs against just one order for the A350-1000. Some airlines have begun downgrading some A350-1000 orders to the 325-seat A350-900.
Qatar Airways, which has ordered both the A350-1000 and the 777X, indicated it was moving in the opposite direction and said it could shift more of its A350 orders to the largest model.
“There is a possibility that we could convert some of the 900s to the 1000,” Chief Executive Akbar Al Baker said.
Qatar is the top A350 customer with 76 on order, including 37 A350-1000s, which have a list price of $367 million.
It recently canceled four A350-900 orders following delays, but subsequently re-committed to the new European jet family.

NO NEW A350 MODEL
The prospect of upgrades will come as a relief to Airbus, which is gambling on the A350-1000 to contain any market pressure from the 777 as Boeing develops its new model.
Last summer, the European planemaker shelved tentative plans for an even bigger A350 that would compete more directly with Boeing’s planned 777X.
Fabrice Bregier, speaking on his last day as Airbus chief operating officer, said on Tuesday studies had shown the idea worked in principle, but that Airbus would focus instead on pushing the A350-1000.
“It’s now time to start to be more aggressive and to explain to our customers, or Boeing’s customers, that this aircraft will be a better choice than a 777-9X,” Bregier said.
Boeing insists that its jet will be the world’s most efficient aircraft in its category, thanks to new wings.
Baker said Qatar Airways, one of the world’s major fleet buyers, is not interested in an ultra-long-haul version of the A350-900 being floated by Airbus for carriers like Qantas but could buy more of regular A350 jets.
“Yes, there may in future be a requirement for more of these airplanes for Qatar Airways, especially when we do further enhancements of our acquisitions,” he said.
“And of course there is a probability we will buy more of these airplanes to put in our leasing company.”
He also ruled out orders for the largest and smallest Airbus jets — whether the 544-seat A380, of which it has bought 10 and has options for another three, or the Bombardier CSeries, a 110 to 130-seater that Airbus agreed to rescue last year.


New oil, gas projects to accelerate next year

Updated 17 December 2018
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New oil, gas projects to accelerate next year

  • Global investment in oil and gas production is expected to reach around $425 billion next year
  • Many of the new projects will be around gas, with a record number of liquefied natural gas (LNG) projects

LONDON: The number of new oil and gas projects will rise five-fold next year from a 2015 trough but overall spending is still unlikely to be enough to meet future demand, consultancy Wood Mackenzie said in a report.
Shaken by a sharp drop in oil prices in recent months, boards are generally expected to stick to spending discipline imposed following the 2014 price crash.
Global investment in oil and gas production, known as upstream, is expected to reach around $425 billion next year, according to WoodMac analyst Angus Rodger.
That compares with a total spending of $770 billion in 2014, which dropped to $400 billion in 2016 and 2017.
Although spending levels have slightly recovered since then, next year’s capital expenditure will still fall short of the $600 billion required to meet demand growth and to offset the natural decline of output from fields, Rodger told Reuters.
A handful of the world’s top oil companies, including US giants Exxon Mobil and Chevron, said they would boost spending next year as they accelerate developments of highly-productive shale fields.
But overall, companies will seek to maintain spending largely flat in order to return cash to investors after years of pain, Rodger said.
Still, deep cost cuts introduced in recent years and lower rates for drilling rigs and services mean that companies can do more with their money.
In 2019, the number of large new oil and gas projects is expected to reach up to 50, compared with 40 in 2018, and around 10 in 2015, according to WoodMac’s 2019 outlook. Large projects hold over 50 million barrels of oil or gas equivalent.
Many of the new projects will be around gas, with a record number of liquefied natural gas (LNG) projects set to get the green light in 2019.
Those include the Arctic LNG-2 in Russia, at least one project in Mozambique and three in the United States, which would together require $50 billion, according to the report.
“The stars are aligning on LNG sales contracts, corporate appetite, long-term demand and costs. But these are huge investments, and investor confidence could waver if we see signs of cost inflation, global recession and falling prices.”
The LNG projects will target 100 trillion cubic feet of gas, up from 80 tcf in 2019 and 32 tcf in 2017.
Spending could see a strong increase in 2020 if oil prices continue rising steadily and as rig costs are expected to rise, Rodger said.