INPEX is just the latest major oiler to flag deep cuts to its operations and capital expenditure, today announcing at its annual general meeting it was reviewing investment and seeking cost saving measures.
Inpex today confirmed to shareholders it was considering its options and is looking to make cuts following a growing trend of other international oil and gas producers. No specific details were given however.
Over the last fortnight, as the oil price plunged below $30 a barrel and fears of a global recession ramped up, international oil and gas companies have taken the axe to capital expenditure and operational expenditure budgets.
Shell plans to lop US$9 billion from its spending plans as it seeks to weather out the collapse in oil prices, cutting operating costs by $3 billion and capex by $5 billion.
Shell has also suspended its buy-back share program, saying its "decisive action" would protect cash flow and guarantee dividends.
French oil producer Total said it would slash operating costs by $500 million and suspend its $2 billion buyback program having already repurchased about $550 million of shares.
BP has said it is "making interventions" and has flexibility to cut its spending by 20%. BP is yet to make any specific spending figure for 2020 public.
Equinor said just this week it would follow suit reducing capex by US$3 billion to ride out the oil price and COVID-19 pandemic. It had already suspended a $5 billion share buyback program.
Equinor is postponing all its US shale drilling and expects to be cash flow neutral at an average oil price of $25/bbl.
Overnight Eni, joined its fellow European-based multinationals, revising its planned activities and reducing its capex by around US$3 billion. This equates to 35% of its planned capex.
Chevron has also made big cuts this week in the face of oil price woes too, outlining measures which include cutting capex by US$4 billion, or 20% and also suspending its annual share repurchase program.
Chevron's biggest cut will target upstream unconventionals, primarily in the US Permian Basin, where the company will slash more than $2 billion in spending.
A further $1.2 billion will be hacked from upstream projects and exploration both across its US assets and internationally.
Around $800 million will be shaved from its downstream and chemicals business.
ConocoPhillips has committed to US$2.2 billion worth of spending cuts.
The Houston-based oil business released a statement last week saying it would reduce its forecast operational capex by $700 million, or 10% and cancelling $500 million worth of planned 2020 share repurchases.
On a combined basis, the capital and share repurchase cuts represent a reduction in 2020 cash uses of $2.2 billion, according to the company.
"Our industry is clearly experiencing an unprecedented event brought about by simultaneous supply and demand shocks," ConocoPhillips CEO Ryan Lance said.
Source: Energy News Bulletin
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