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Permian Opportunities
Of the major domestic shale oil plays, only the Permian Basin of West Texas and Southeast New Mexico continues to increase production. “World Oil” cites a recent study by consulting firm IHS, which notes that the area is a hotbed of deal making as the opportunities there are the best currently available to shale operators. … Read More
Global LNG Outlook
“World Oil” cites recent analysis by consulting group, Wood Mackenzie, which notes that both Asia in general, and China in particular, saw Liquefied Natural Gas (LNG) demand fall by 2% in 2015. Concurrently, capacity increased with significant start-ups in the U. S. and Australia. In fact, production increased to 250 million tonnes, up 4 million… Read More
DUCs to the Rescue
Approximately one-third of the cost of an oil well is land acquisition and drilling costs. Drilling contracts typically are long term and involve stiff cancellation penalties. Contracts for completion services are of shorter duration and penalties less severe. Consequently, when oil prices started collapsing, shale operators used scarce capital to keep drilling but left the… Read More
Dollar Bedevils Oil Price
The world-wide oil glut has been blamed for the collapse in oil prices and justifiably so. “World Oil” points out that Goldman Sachs has recently forecast $20 oil based on oversupply and the risk of running out of domestic storage capacity. According to the U. S. Energy Information Administration the major domestic terminal at Cushing,… Read More
Stripper Survival
Historically “stripper” wells have been defined as those which produce less than 10 barrels per day. The traditional wisdom is that the small operators who produce these wells are the most vulnerable to downturns in the oil market. However, a recent article in “Rigzone” points out that despite low production volumes, limited access to capital,… Read More
