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The Weekly Oil and Gas Update

The Weekly USA Oil & Gas Update: 25th August 2015

Contributor: Todd Erickson
Posted: 08/24/2015
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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

13

+1

9

6

Arkansas

4

0

8

12

California land

13

+1

12

44

Colorado

37

-1

39

74

Kansas

13

+1

13

28

Mississippi

3

-1

4

14

N. Louisiana

28

0

27

30

New Mexico

52

0

47

94

North Dakota

72

+3

78

183

Ohio

19

0

23

42

Oklahoma

106

+3

104

208

Pennsylvania

36

-2

49

50

Texas

383

-6

373

888

Utah

4

0

7

23

West Virginia

17

-1

18

30

Wyoming

25

+1

22

56

Total US

885

+1

885

1896

Total Canada land

204

-3

69

401

Oil & Gas Prices - Bloomberg/EIA

This Morning

12 weeks ago

1 year ago

Crude Oil - USD/bbl

WTI

38.81

60.24

96.44

Brent

43.43

62.87

99.37

Natural Gas-USD/mmbtu

NYMEX Henry Hub

2.66

2.78

3.94

General News

Iran plans to raise its oil output "at any cost"

Despite plummeting crude oil prices worldwide, Iran feels the need to defend its market share in the global crude oil market. According to Iran's Oil Minister Bijan Namdar Zanganeh, "we will be raising our oil production at any cost and we have no other alternative." Iran is already OPEC's second largest producer, so the increased production could provide a material impact on world markets. Article here

More US crude oil pumped in July than ever recorded

According to a monthly report from the American Petroleum Institute, crude oil production was up 8.8% from a year ago in July, making it the highest producing July on record since 1920, the first year production data was collected. This is despite the recent plunge in crude prices and subsequent decline in drilling operations. "There's a lot of momentum in the system," said John Felmy, chief economist at the API in Washington, with previously-drilled wells still coming on line. Crude stockpiles are also up 25% from a year ago, to 460 million barrels at the end of July. Article here

Unconventional Oil & Gas News

Analyst expects US to lift crude oil export ban in 2016

According to analysts at Evercore ISI, it is "60 percent likely" that the ban on US crude oil exports will be lifted by the end of 2016's first quarter. It might come with strings attached however, likely in the form of restrictions in export volumes. "Obama and his regulators are likely to have a more positive view of an oil export ban repeal that empowered regulators generally to decide oil export levels," said Evercore's Terry Haines. "That sort of repeal also would be attractive to congressional Republicans and Democrats that would see it as a compromise alternative that overturns the ban and is a significant step on the road to full unregulated repeal." With WTI still selling at a discount of over 10% compared to world crude prices, the relief would be welcomed by many in the US industry, especially those producing sweet, light crude from shale formations, which is generally desirable in foreign markets. Article here

Environment and Safety News

Shell granted final permit for this summer's Arctic drilling program

The company began work last month on the well but was only allowed to drill the top sections. The offshore well, located in the Arctic Ocean off the north coast of Alaska, has drawn significant resistance from environmental groups. This final permit will enable Shell to drill into oil-bearing rock. So far, Shell has invested over $7 billion into the multi-year effort with no oil to show, but remains confident that large quantities of crude lie in the region. Article here

Mergers and Acquisitions News

Accenture acquires Schlumberger's management consulting division
Neither party disclosed terms of the deal, but one analyst speculated the purchase price was approximately $250,000 per employee, which would make the 250-consultant division worth $62,500,000. Per Schlumberger's website, the division represents the world's leading management consultancy in upstream oil & gas. Article here

Contributor: Todd Erickson