Alternative energy is coming on. It’s going to be quite a while before it really challenges fossil fuels for supremacy, but it’s definitely growing.
One thing I’ve wondered about in the last year or so was whether the industry would be able to attract the workers that it laid off during the last bust. This article says that at least some previous oil and gas workers are not coming back. That should slow down the next boom a bit.
Eclipse Resources holds the world record for a horizontal well at 18,500 feet. This year they plan to drill 11 extra long wells.
Add another one to the list. An old coal fired power plant is going to be replaced by a new combined cycle natural gas power plant. It’s in southwest PA, not too far from the West Virginia border.
Canada used to be the largest purchaser of U.S. crude at around 7 million barrels, but China bought a little over 8 million in February.
The Dimock ruling has been overturned by a federal judge. It’s somewhat unusual for a judge to overturn a case for “weaknesses in the plaintiff’s case”. Usually appeals courts are looking at things like incorrect jury instructions, the lower court’s understanding of the law, misconduct by the lawyers, that kind of thing. Appeals courts don’t overturn jury decisions often, but that’s what happened here.
Natural gas storage volumes are going up. In 2014 and 2015 the increase was negligible, but in 2016 it was significant.
April 10, 2017: Natural gas prices are at $3.23/MMBtu. That’s a healthy price.
U.S. oil producers increased investment in 4Q 2016 — by a lot.
Cheniere Energy’s Sabine Pass LNG export plant has it’s third train ready to produce LNG.
This is news I did not expect to hear. The U.S. has been producing more energy every year for the last six years. Even during the downturn of 2014 and 2015 production went up. OK, increased production caused the downturn. But that’s part of the reason why I figured our energy production was still growing. But, turns out energy production fell in 2016. The big loser was coal (at -18%), and the “big” winner (at 7%) was renewables.
Shale drillers have driven their breakeven prices below $40/bbl. Some say it’s because of increased efficiency. Others say it’s because oil field service providers have drastically reduced their prices. It turns out that non-shale projects have also driven their breakeven prices below $40/bbl. This supports the argument that it’s the cost of oil field services that is behind the lower breakeven price.
In spite of the title, this article says that the supply of oil is going down and the price of oil is going up in the next few years.
Oil service companies have started hiring again, in spite of having fired over 1/3 of their workers during the downturn.
One of the cool things about natural gas is that it’s cleaner than coal or oil. Energy related CO2 emissions fell by 1.7% in 2016, mostly because we’re using less coal, partly because we’re using more gas.
April 17, 2017: Tax Day! Both oil and gas prices are at what I consider healthy levels for U.S. developers, oil is at $52.76 and gas is at $3.20. It’s going to be interesting to watch the prices going forward as things seem to be somewhat stable for the moment but something always happens to upset the proverbial apple cart. It’s anybody’s guess what that will be.