The International Association of Geophysical Contractors (IAGC) President Nikki Martin recently issued the following statement regarding environmental groups' attacks on the geophysical and oil and gas industries.
"In recent months, environmental activist groups have increasingly used misinformation targeting geophysical surveys in an effort to halt oil and gas exploration and development. One such example of their propaganda aired this week on US television in an attempt to mislead the public to believe that seismic surveys are harmful to marine life.
Meanwhile, recent news highlights the benefits of using seismic surveys as countries stake their territorial claims in the arctic by mapping the continental shelf adjacent to their boundaries. There is also a documentary screening at film festivals around the world featuring the important research of the Earth Observatory of Singapore using this same geophysical technology to predict and prevent the devastating consequences of earthquakes.
Seismic and other geophysical surveys have been safely conducted in the US and around the globe for more than 50 years. In fact, whether on land or in the ocean, geophysical surveys have numerous applications in addition to oil and gas exploration, including scientific and academic research and pre-development studies for roads and renewable energy facilities.
US Representative Jeff Duncan stated in a Congressional Hearing this week, that we must not put our nation at risk by limiting access to potential US energy resources because of these environmental groups' use of "fear-mongering tactics" when there is not one single verifiable instance of sound from geophysical surveys harming marine mammal populations.
Protecting the marine environment and oil and gas exploration are not mutually exclusive, and the two successfully coexist every day. The geophysical industry, along with exploration and production (E&P) companies, invests significant resources in research to increase understanding of the effect of sound on marine life generated by oil and gas E&P activity. The research contributes to the knowledge base and helps industry develop effective mitigation strategies for any potential risks that may exist.
The geophysical industry proudly enables the discovery of resources that ensure access to safe affordable energy around the globe and that provide more than 6,000 petroleum-based products, from hospital equipment and smartphones to the vehicles, kayaks, and bicycles environmental activists ride to "keep it in the ground" protests.
The geophysical industry takes a great deal of care and consideration of all aspects of the marine environment and has consistently demonstrated its ability to operate in an environmentally responsible manner. "
About the IAGC
The IAGC represents more than 125 member companies worldwide from all segments of the geophysical industry and is the only trade organisation solely dedicated to representing the industry. It is the leader in geophysical technical and operations expertise and for more than 45 years, the IAGC has worked to optimise the business and regulatory climate and enhances public understanding to support a strong, viable geophysical industry essential to discovering and delivering the world's energy resources.
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Headline crude prices for the week beginning 11 March 2019 – Brent: US$66/b; WTI: US$56/b
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GEO ExPro Vol. 16, No. 1 was published on 4th March 2019 bringing light to the latest science and technology activity in the global geoscience community within the oil, gas and energy sector.
This issue focuses on new technologies available to the oil and gas industry and how they can be adapted to improve hydrocarbon exploration workflows and understanding around the world. The latest issue of GEO ExPro magazine also covers current training methods for educating geoscientists, with articles highlighting the essential pre-drill ‘toolbox’ and how we can harness virtual reality to bring world class geological locations to the classroom.
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In 2017, Norway’s Government Pension Fund Global – also known as the Oil Fund – proposed a complete divestment of oil and gas shares from its massive portfolio. Last week, the Norwegian government partially approved that request, allowing the Fund to exclude 134 upstream companies from the wealth fund. Players like Anadarko Petroleum, Chesapeake Energy, CNOOC, Premier Oil, Soco International and Tullow Oil will now no longer receive any investment from the Fund. That might seem like an inconsequential move, but it isn’t. With over US$1 trillion in assets – the Fund is the largest sovereign wealth fund in the world – it is a major market-shifting move.
Estimates suggest that the government directive will require the Oil Fund to sell some US$7.5 billion in stocks over an undefined period. Shares in the affected companies plunged after the announcement. The reaction is understandable. The Oil Fund holds over 1.3% of all global stocks and shares, including 2.3% of all European stocks. It holds stakes as large as of 2.4% of Royal Dutch Shell and 2.3% of BP, and has long been seen as a major investor and stabilising force in the energy sector.
It is this impression that the Fund is trying to change. Established in 1990 to invest surplus revenues of the booming Norwegian petroleum sector, prudent management has seen its value grow to some US$200,000 per Norwegian citizen today. Its value exceeds all other sovereign wealth funds, including those of China and Singapore. Energy shares – specifically oil and gas firms – have long been a major target for investment due to high returns and bumper dividends. But in 2017, the Fund recommended phasing out oil exploration from its ‘investment universe’. At the time, this was interpreted as yielding to pressure from environmental lobbies, but the Fund has made it clear that the move is for economic reasons.
Put simply, the Fund wants to move away from ‘putting all its eggs in one basket’. Income from Norway’s vast upstream industry – it is the largest producing country in Western Europe – funds the country’s welfare state and pays into the Fund. It has ethical standards – avoiding, for example, investment in tobacco firms – but has concluded that devoting a significant amount of its assets to oil and gas savings presents a double risk. During the good times, when crude prices are high and energy stocks booming, it is a boon. But during a downturn or a crash, it is a major risk. With typical Scandinavian restraint and prudence, the Fund has decided that it is best to minimise that risk by pouring its money into areas that run counter-cyclical to the energy industry.
However, the retreat is just partial. Exempt from the divestment will be oil and gas firms with significant renewable energy divisions – which include supermajors like Shell, BP and Total. This is touted as allowing the Fund to ride the crest of the renewable energy wave, but also manages to neatly fit into the image that Norway wants to project: balancing a major industry with being a responsible environmental steward. It’s the same reason why Equinor – in which the Fund holds a 67% stake – changed its name from Statoil, to project a broader spectrum of business away from oil into emerging energies like wind and solar. Because, as the Fund’s objective states, one day the oil will run out. But its value will carry on for future generations.
The Norway Oil Fund in a Nutshell