O&G Members Banner

The Weekly Oil and Gas Update

The Weekly USA Oil & Gas Update: 12th December 2015

Contributor: Todd Erickson
Posted: 01/03/2016
Rate this Column: 
Be the first!

The Oil & Gas Weekly is compiled by Todd Erickson. Todd is a veteran executive manager in the North American E&P market.

He has management experience in high-growth oil & gas service organizations performing a leadership role in operations, strategy, and corporate development with a track record of identifying opportunities and best-practices, creating execution plans, then developing effective teams and leaders to execute them.

Learn more about Todd here

Rig Counts - select states with key plays

Select states

This Week

Change from last week

3 months ago

One year ago

Alaska

11

-1

13

10

Arkansas

1

-2

3

12

California land

9

0

13

26

Colorado

24

-1

33

69

Kansas

12

+1

9

29

Mississippi

5

0

5

14

N. Louisiana

27

-2

28

28

New Mexico

38

+1

50

102

North Dakota

55

-3

66

169

Ohio

15

0

19

47

Oklahoma

88

+2

105

209

Pennsylvania

26

0

33

54

Texas

319

-1

363

852

Utah

3

0

5

23

West Virginia

16

0

17

28

Wyoming

17

-3

24

57

Total US

700

-9

838

1840

Total Canada land

126

-35

175

253

Oil & Gas Prices - Bloomberg/EIA

This Morning

12 weeks ago

1 year ago

Crude Oil - USD/bbl

WTI

36.93

46.28

55.25

Brent

36.85

49.45

58.31

Natural Gas-USD/mmbtu

NYMEX Henry Hub

2.13

2.34

3.05

General News

US rig count at its lowest since 1999

According to Baker Hughes, the rig count ended the week at 700, down 9 units from the previous week, and its lowest count since September 10, 1999. North Dakota dropped to 55 rigs, its lowest since 2009, early in the Bakken shale boom. Louisiana listed just 56 rigs, its lowest since Baker Hughes began tracking the state's data in 2000. Texas' Permian Basin was the exception; it jumped 6 units to 212 rigs as its best-in-class economics continue to drive growth in rig counts and production despite low crude and gas prices. Article here

Unconventional Oil & Gas News

Marcellus and Utica producers expect slow 2016

Prices for natural gas look bad priced at $2.00 per mcf at the Henry Hub in the southern US, but for producers in Ohio and West Virginia, it looks even worse. Due to lack of takeaway pipelines to enable broader market access, producers in these areas only receive about $0.75 per mcf. With major takeaway pipelines currently planned not due to be complete until 2017 or later, the market is limited for the natural gas produced in these states. "It is going to be a slow 2016 because of the prices. They are down across the US, but even more in Marcellus and Utica Shale because of that glut of gas," said," Shawn Bennett, EVP of the Ohio Oil and Gas Association. "At 75 cents per mcf, you just can't make it work." Article here

Environment and Safety News

Natural gas leak in California prompts 1,700 homes to evacuate

The leak comes from a natural gas storage field owned by Southern California Gas Co, located in the hills above Los Angeles. Officials say that the leak first began several months ago due to a well casing failure, and is now leaking at the rate of 110,000 pounds per hour, which makes it the single largest source of methane emissions in all California. "It's one of the biggest leaks we've ever seen reported," said Tim O'Connor, California director for the Environmental Defense Fund. SoCalGAs is trying to plug the leak by pouring a brine solution into the well and drilling relief holes, but has had little success so far. Article here

Mergers and Acquisitions News

Private equity giant KKR announces oil and gas investment platform
The private equity fund has appointed Deepak Munganahalli to head the effort. "Our goal is to become an integrated solutions provider for engineering, maintenance, repair and overhaul services for asset owners and operators in the oil and gas industry. Together with KKR and its deep industry and investment expertise, we look forward to providing a differentiated set of capabilities to the industry," said Munganahalli. Despite the crash in equity values due to anticipated prolonged low commodity prices in the sector, private equity must see opportunities for long run growth. KKR is not the only private equity investor looking to buy at the bottom. Article here

Contributor: Todd Erickson