In Oil & Companies News 11/05/2015
Saudi Arabian Chevron will start shutting down production today at the Wafra oil fields, removing about 250,000 barrels a day of potential supply from world markets, according to two people with knowledge of the matter.
The Chevron Corp. unit will begin halting operations at the fields that Saudi Arabia is developing jointly with Kuwait, according to the people, who asked not to be identified because the information is confidential. A Chevron Corp. media official had no immediate comment when asked in an e-mail.
Saudi Arabian Chevron faces difficulties obtaining work permits and bringing equipment to the Wafra fields, which lie in a neutral border zone controlled by both Kuwait and Saudi Arabia, Sally Jones, a spokeswoman for the company in London, wrote in an e-mail on April 21.
A halt at Wafra may help ease a global supply glut that drove benchmark prices down about 50 percent last year. OPEC, which counts Kuwait and Saudi Arabia as members, chose in November to keep pumping crude oil to protect its share of the global market rather than cutting output to boost prices. The 12-nation Organization of Petroleum Exporting Countries produced more than 31 million barrels a day last month, data compiled by Bloomberg show.
Fadghoush Shabib Al-Ajmi, head of the labor union representing workers at state-run Kuwait Gulf Oil Co., Saudi Chevron’s partner at Wafra, said early Monday that the fields were producing normally. “Chevron is at Wafra joint operations, and there are no orders to shut down,” he said on Twitter.
The fields, with a capacity of about 250,000 barrels a day, were producing 180,000 barrels in February, two other people with knowledge of the matter said on April 22. Kuwait’s government stopped issuing or renewing permits for workers at Wafra last year, these people said.
Saudi Arabia halted operations in October at the Khafji offshore fields, which are in the same neutral zone, citing unspecified environmental concerns. Khafji also has a production capacity of about 250,000 barrels a day.
