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Oil and Gas exploration: Ensuring safe, reliable field performance with end-to-end enterprise asset maintenance

Here is a news regarding the success rates for discovering new oil and gas resources. Do you know that 2021 saw one of the lowest on record? However, with the return of high-impact oil exploration in 2022, O&G businesses have seen a much higher success rate. In fact, by September 2022, exploration, development, and production (E&P) firms had already discovered more than 1.7 Bboe at high-impact wells–four times what was discovered for all of 2021. With success rates like this, E&P organizations plan to move forward with a range of new projects that will have pumps producing oil for years to come. Let’s learn more about the Oil and gas exploration opportunities.

With the recent extraordinary energy crisis unfolding, the steady movement forward on high-impact oil exploration feels urgent. Offshore oil and gas engineering, procurement, and construction (EPC) spending globally could total $276 billion. This is between 2022 and 2026, a 71% increase. Expenditures will certainly be high and production sites offshore can produce better profits. This is of course at lower prices when they are completely up and running. Furthermore, these offshore projects are to produce oil for several decades. And ultimately, because of the large scale of the developments, the production will come at lower break-even costs.

There’s no question that the business of oil and gas drilling comes with an array of hazards, especially true when drilling offshore, miles from land. There is a plethora of heavy and dangerous equipment, and part of ensuring rig workers are safe means receiving in-depth training regarding equipment usage. Now, it’s just as important to ensure that all assets and equipment used are maintained for healthy working conditions. This all translates to the need for effective field support and digital alignment, with a framework for application and focus on new technology.

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Source: World Oil

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Oil & Gas Pipelines

North America Leads $370 Billion Global Push For Oil & Gas Pipelines

This year, the United States became the world’s biggest liquefied natural gas (LNG) exporter. This is as deliveries to energy-starved buyers in Europe and Asia surged. In the current year, five developers have signed over 20 long-term deals. They are to supply more than 30 million metric tons/year of LNG or roughly 4 Bcf/d, to energy-starved buyers in Europe and Asia. Let’s talk more about Oil & Gas Pipelines.

Unfortunately, whereas the United States has the world’s largest backlog of near-shovel-ready liquefied natural gas projects, takeaway constraints including limited pipeline capacity are seen as the biggest hurdle to the growth of the sector. In the Appalachian Basin, the country’s largest gas-producing region churning out more than 35 Bcf/d, environmental groups have repeatedly stopped or slowed down pipeline projects and limited further growth in the Northeast. Indeed, EQT Corp.(NYSE: EQT) CEO Toby Rice recently acknowledged that Appalachian pipeline capacity has “hit a wall.”

Luckily, the Permian Basin and Haynesville Shale are still able to shoulder much of the growth forecast for LNG exports. This includes pipeline development. Analysts at East Daley Capital Inc. have projected that U.S. LNG exports will grow to 26.3 Bcf/d by 2030 from their current level of nearly 13 Bcf/d. For this to happen, the analysts say another 2-4 Bcf/d of takeaway capacity would need to come online. Ideally between 2026 and 2030 in the Haynesville.

And it appears the U.S. is up to the task.

According to RigZone, initial findings from Westwood’s upcoming onshore pipeline market forecast has revealed that between 2022 and 2028, the world will spend ~$369B on 310,000km of new oil and gas pipelines, with North America responsible for the lion’s share. The forecast says that 205,000km, or two-thirds of total installations, will be gas pipelines, with several projects already lined up in the United States.

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Source: Oil Price

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US Oil and Gas Giants

US Oil and Gas Giants’ Profits Skyrocket

Several European and US oil and gas Giants (producers), including France’s TotalEnergies, Norway’s Equinor, and Aker BP along with the UK’s Shell, released their quarterly reports this week. Thanks to the energy crisis, all four players delivered strong financial results. However, we can now see how the U.S. oil majors have performed in comparison with their European counterparts and themselves in these turbulent times, marked by price volatility and high demand.

Chevron reported on Friday that its earnings in the third quarter of 2022 were $11.2 billion, compared with $6.1 billion in the third quarter of 2021. The U.S. giant outlined that pension settlement costs of $177 million were included in this quarter while foreign currency effects increased earnings by $624 million.

The company posted adjusted earnings of $10.8 billion for the third quarter of 2022, compared to adjusted earnings of $5.7 billion in the third quarter of last year. Chevron’s sales and other operating revenues in 3Q of 2022 were $64 billion, compared to $43 billion in the year-ago period.

Commenting on this, Mike Wirth, Chevron’s chairman and chief executive officer, remarked: “We delivered another quarter of strong financial performance with a return on capital employed of 25 percent. At the same time, we’re increasing investments and growing energy supplies, with our Permian production reaching another quarterly record.”

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Source: Offshore Energy

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‘Strongest climate bill ever’ may increase oil and gas production in New Mexico

President Joe Biden’s $737 billion Inflation Reduction Act (IRA) aims to address a cornucopia of American ills. Arguably its most important aspect is how it jump-starts the country’s fight against climate change. Have you heard about the strongest climate bill that’s coming?

It attacks the country’s carbon emissions from both ends — consumption, and production — with one primary tool: money. A lot of money: $369 billion, to be exact, much of that devoted to helping people. Companies and government agencies buy more things that create less carbon pollution. That has many activists hailing the bill as a historic step forward in climate action. However, not everyone is sold on the strategy.

“All of these environmental organizations are singing its praise. ‘The strongest climate bill ever passed!.’” says Sharon Wilson, a senior field advocate at Earthworks in Texas. “It is also the sh****st climate bill ever passed. Because it is the only climate bill that’s ever passed.”

There is only one climate punishment in the IRA: a new Methane Emissions Reduction Program (MERP) that levies a methane tax on oil and gas producers who exceed strict limits on how much they can emit the potent greenhouse gas. But the program may have the ironic consequence of increasing oil and gas production — and methane emissions — in New Mexico.

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Source: Source NM

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US Oil and Gas Production Continues to Rise but Inflation’s Effects Loom

The US Energy Information Administration projects that the nation’s unconventional oil and gas production will reach record levels in November. There are indications that inflation could limit growth moving forward.

According to the EIA’s monthly Drilling Productivity Report, shale oil production should surpass 9 million barrels per day in October. It will increase to 9.1 million bpd in November. Shale gas production is anticipated to increase to 94.5 billion cubic feet per day this month.

U.S. dry natural gas production in 2021 was about 34.5 trillion cubic feet (Tcf). It is an average of about 94.6 billion cubic feet per day and the highest annual amount recorded. Most of the production increases since 2005 are the result of horizontal drilling and hydraulic fracturing techniques. Notably in shale, sandstone, carbonate, and other tight geologic formations. Natural gas is produced from onshore and offshore natural gas and oil wells and from coal beds. In 2021, U.S. dry natural gas production was about 13% greater than U.S. total natural gas consumption.

U.S. dry natural gas production in 2021 was about 1 Tcf greater than in 2020. This is as the natural gas drilling industry recovered from the effects of the COVID-19 pandemic and encouraged by increases in demand, especially for exports, and by higher prices for natural gas.

Five of the 34 natural gas-producing states accounted for about 70% of total U.S. dry natural gas production in 2021. 09178789739

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Source: Upstream

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Global Oil Demand

Global Oil Demand Rebounded By 2 Million Bpd In August

After a counter-seasonal drop in July, global oil demand rebounded in August by 2 million barrels per day (BPD) to reach 99 percent of pre-Covid levels, data from the Joint Organizations Data Initiative (JODI) showed on Monday.

Oil demand growth in August was driven by higher consumption in the United States, China, Japan, Saudi Arabia, and Indonesia, the Riyadh-based International Energy Forum (IEF) said, citing the latest JODI data.

Of note in August was also a 500,000 BPD increase in global crude oil output, with Saudi Arabia’s production rising above 11 million BPD – only the third time the Kingdom has reported output of over 11 million BPD, according to the JODI database which compiles self-reported figures from countries.

In the United States, crude oil production rose by 290,000 bpd in August and is up by 813,000 bpd from year-ago levels, the data showed. Product demand rose by 1.46 million bpd in August, and U.S. crude oil closing stocks dropped by 22.7 million barrels to their second-lowest level recorded in JODI.

The August rebound in global demand follows an estimated 1.1 million bpd drop in July, which was an unusual slump for this time of the year.

Demand for August may have rebounded, but the oil market and oil analysts say that the ongoing economic slowdown and looming recessions could limit demand growth in the near term.

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Source: Oil Price

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Exxon

Exxon eyes takeover of Plano-based oil and gas company

Exxon Mobil Corp. is considering a takeover of Plano-based Denbury Incorporated. They are an oil and gas producer with the largest carbon dioxide pipeline network in the U.S. This is according to people familiar with the matter.

Irving-based Exxon has expressed preliminary interest in the company. They are asking not to be identified because the matter isn’t public. They are adding that no final decision has been made. With that Exxon could opt against proceeding with a potential deal.

If a takeover happens, it would be the biggest carbon-management investment since the Inflation Reduction Act was passed in August. It will be providing large tax incentives for burying carbon dioxide. The legislation increased tax credits for carbon capture 70% to $85 a ton.

Executives including Exxon CEO Darren Woods have praised the act. Is is bringing financial support for carbon capture. Morgan Stanley says could be highly profitable in the future.

Shares of Denbury jumped as much as 12% and traded at $98.83 in New York Monday afternoon, giving the company a market value of about $4.9 billion. A Denbury representative declined to comment, while an Exxon representative didn’t immediately respond to a request for comment.

Carbon capture is the bedrock of Exxon’s climate strategy, which aims to eliminate the oil giant’s operational emissions by 2050. Denbury’s 1,300 miles of pipelines in the Gulf Coast and the Rocky Mountains dedicated to transporting carbon dioxide would give Exxon critical and hard-to-replicate infrastructure that will be essential if its carbon capture push is to be a success.

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Source: The Dallas Morning News

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Permian Basin Oil and Gas Wells

New Mexico, Texas Team Up to Regulate Permian Basin Oil and Gas Wells Crossing State Line

Oil and gas operations in the Permian Basin – shared by southeast New Mexico and West Texas – boomed in recent years with wells sprouting up around the state line between the two states.

Wells even crossed state lines, being drilled horizontally from origin points in either New Mexico or Texas and stretching up to 10 miles across the border.

They are ensuring such wells follow the regulations of both states. New Mexico’s Oil Conservation Division (OCD) and the Texas Railroad Commission (RRC) signed an agreement. They will regulate interstate oil and gas facilities in tandem.

A memorandum of understanding (MOA) was signed by the two regulators last month. This is to require they both get adequate reporting and compliance from oil and gas operators that cross the state’s border.

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Source: Carlsbad Current-Argus

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Oil and Gas Drilling Auctions

U.S. Sets Out Oil and Gas Drilling Auctions Required Under New Law

The U.S. Interior Department took initial steps on Thursday toward holding oil and gas drilling auctions in New Mexico, Wyoming, and the Gulf of Mexico in the coming months.

Terms of the onshore sales will reflect new requirements under President Joe Biden’s new climate change and drug pricing law the Inflation Reduction Act (IRA), including higher royalty rates, minimum bids, and rents, Interior said.

Interior’s Bureau of Land Management said it was seeking public input for 30 days on a plan to offer 251,086 acres in Wyoming and 10,124 acres in New Mexico to oil and gas companies.

The IRA, which Biden signed into law in August, contains nearly $370 billion for climate change and clean energy initiatives such as incentives for solar and wind power. But it also contains protections for the powerful oil and gas sector.

Biden vowed during his 2020 election campaign to end federal oil and gas drilling to fight climate change, but faced pressure to increase fuel production in the face of soaring prices.

Interior said it would evaluate potential sale parcels in other states in the coming weeks.

Separately, the Interior’s Bureau of Ocean Energy Management released a draft environmental review for two Gulf of Mexico drilling auctions that are required to be held next year.

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Source: Reuters

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Oil Prices Rise

Oil Prices Rise As API Reports Surprise Crude, Gasoline Draws

The American Petroleum Institute (API) reported a surprise draw this week for crude oil of 1.770 million barrels. On the other hand, analysts predicted oil prices rise of 333,000 barrels. U.S. crude inventories have grown by roughly 21 million barrels so far this year, according to API data, while the U.S. Strategic Petroleum Reserves fell by nearly eight times that figure.

The draw comes even as the Department of Energy released 6.2 million barrels from the Strategic Petroleum Reserves in the week ending September 30 that left the SPR with 416.4 million barrels.

WTI rose on Tuesday prior to the data release. At 2:28 p.m. ET, WTI was trading up $3.15 (+3.77%) on the day at $86.78 per barrel—up nearly $9 per barrel on the week (after a $7 per barrel slide in the week prior). Brent crude was trading up $3.13 (+3.52%) on the day at $91.99—a more than $6 increase on the week that more than erased the previous week’s $5 decrease. Crude oil prices continued to rise throughout the afternoon, with a flurry of OPEC+ chatter detailing just how much crude oil production the group could decide to cut for December. The most recent report figure suggests the group could be contemplating a cut up to 2 million bpd.

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Source: Oil Price

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