Saudi Arabia is continuing to increase its oil output even as prices hover under $60 a barrel. Last month, the Organization of Petroleum Exporting Countries’ (OPEC) bi-annual meeting, Saudi Arabia and other members of the cartel kept their production target unchanged despite the low price environment.
Saudi Arabia continues to argue that it needs to maintain market share and by cutting production and supporting prices, it will give an advantage to shale producers in the U.S. So far, Saudi Arabia has stayed committed to its strategy.
On Monday, a report released by OPEC showed that Saudi Arabia produced 10.6 million barrels of oil per day in the month of June, which represents an increase of more than 200,000 barrels per day over the month of May. According to the Financial Times, this is the highest ever level. The Financial Times further noted that if Saudi Arabia continues to increase its production at the same pace, it will reach 11 million barrels of oil per day by the end of the summer. This would make it the first country to do so since the Soviet Union.
In this backdrop, oil prices will remain under pressure even as shale producers and oil majors in North America cut capital expenditures. Still, many oil & gas producers in North America continue to face difficulties in the low price environment.
Monday morning, Calgary, Alberta-based Groundstar Resources Ltd. (TSX-Venture:GSA) provided an update on its ongoing restructuring. The company said that it had recently retained two consultants to assist in its ongoing initiatives and growing the production and reserves on a go forward basis.
GSA said that its production rates at Neilburg have remained steady at 110 barrels of oil per day net. The company also announced that it is currently licensing a new drilling location at 2-13-45-26 W3. In addition, the company has received a report regarding its reserves from its independent reserves evaluator, Sproule Associates Ltd. for all of its properties effective April 30. The estimates were prepared in accordance with NI 51-101 Standards of Disclosure for oil and gas activities. GSA plans to include the full information on reserves in its annual information form.
GSA also announced that it received a request for a shareholders meeting from a former consultant of the company.
GSA has set January 13, 2016 as the date for its meeting with shareholders, with a record date set at December 16, 2015.
After a huge decline in 2014 along with the price of crude, shares of GSA have been in a tight trading range for much of 2015 of around $0.05 a share.
Related Stories
