Weekly USA Oil & Gas Update for 27th April 2016: New York Rejects Natural Gas Pipeline
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. This weekly update brings you all the stats and headlines you need to know about in the American Oil & Gas landscape including the rig count, oil price, environmental, HSE and M&A news.
Rig Counts - select states with key plays
Oil & Gas Prices - Bloomberg/EIA
IEA - Crude oil market to re-balance in 2017
Fatih Birol, the chief of the International Energy Agency (IEA) doesn't see supply falling to match current demand levels until early 2017. "At the turn of this year or latest 2017, we expect oil markets to re-balance and the prices to re-balance. When we look at all the fundamentals - demand, supply and stocks - I have all the reasons to believe that in the absence of a major economic downturn, we are going to see balance in the markets latest by 2017." Most of the supply reduction is coming from non-OPEC sources, such as the US, Canada, Latin America and Russia, which gives OPEC an increasing world market share as they maintain their current production levels. Iran will also be a factor, as it is expected to contribute an additional 500,000 barrels per day to the market within the next year as western sanctions are lifted. Article here
Job cuts continue as Halliburton and Schlumberger each cut more workers
The world's largest energy services provider, Schlumberger, cut 2,000 additional jobs in the first quarter in an effort to further reduce costs in an industry in free fall. Article here The other industry giant, Halliburton, made even larger reductions, announcing that it cut more than 6,000 jobs in the first quarter as revenue declined over 40%. Article here "Life has changed in the energy industry, especially in North American and over the past several quarters we have taken the steps to adapt to that fact," said Halliburton's CEO Dave Lesar.
Unconventional Oil & Gas News
ExxonMobil begins production at Point Thompson project on Alaska's North Slope
The company has invested $4 billion up to this point, and expects to initially produce 5,000 barrels per day of condensate and 100 million cubic feet of natural gas, which it will re-inject for future recovery. At full production, the facility will be able to double these numbers. The Point Thompson reservoir holds an estimated 8 trillion cubic feet of natural gas along with associated condensate, which represents 25% of the known gas on the North Slope. Article here
Environment and Safety News
New York rejects permit for Constitution natural gas pipeline
The state rejected the permit on environmental grounds, citing water quality issues. The Federal Energy Regulatory Commission (FERC) had already approved the project - New York's final approval was the last step to clear the way for construction. This is the second transmission project to be thwarted; last week backers of the Northeast Energy Direct pipeline, which was to carry gas into the Boston area, also announced they were dropping their project. Article here
Mergers and Acquisitions News
Devon divests Mississippian assets for $200 million