Posted on 12/01/2014 10:59:40 AM PST by thackney
The oil patch gave up some new hints Monday about what drilling activity may look like as oil prices plummet.
November’s batch of new Texas drilling permits fell 50 percent compared to the prior month, in a sign that oil companies are holding back from boring into their sweetest spots while crude prices linger below $70 a barrel. It’s the first time in the past year that the number of new Texas drilling permits has declined: It rose as much as 24 percent in September, according to Austin-based oil field analytics firm Drillinginfo.
For now, it is not necessarily a signal that shale oil producers have found their “breakeven” point, but it shows oil companies don’t want to drill up good spots in what could be a temporary low-price environment, said Drillinginfo CEO Allen Gilmer in an email.
“Given the faster decline of unconventional wells, more of your economics are dependent on your year-forward production,” Gilmer said. “Essentially, people are drilling locations that hold acreage.”
Drillinginfo data shows there were 1,473 new Texas permits in November, down from 2,947 in October. Gilmer said the rest of the United States is seeing the trend, as well.
The oil’s been waiting down there a long time ,it can wait a little longer
The oil won’t go away, just the jobs.
The oil is there. We know how to get it. Thanks to fracking technology, the availability of US oil will act as a ceiling on OPEC jacking up prices in the foreseeable future.
So much for peak oil.
Peak oil production is a function of the price.
The peak isn’t the same at $40, $100 or $400.
We leave most of the oil still in the ground because it isn’t economic to produce.
The jobs will come back when the oil goes back up.
Just a matter of time before rigs start being stacked and people from one end of the oil industry to the other being laid off.
It starts with the most expensive drilling rigs, typically.
Statoil Scuttles Ultra-deepwater Rig Contract; Pays $350mm To Back Away
http://www.freerepublic.com/focus/f-news/3229630/posts
11/21/2014
There’s a multi-billion dollar offshore platform being built and installed right now to frack under the North Sea. It’s called Ensign, and - if I understand it right - will be mostly remote controlled.
OPEC’s (and Vlad Putin’s) strategy is working.
It has been a long time coming.
The Ensign Gas field was discovered by Shell / Esso in 1986 with the drilling well 48/14-2.
http://www.offshore-technology.com/projects/-ensign-gas-field-north-sea-uk/
How businesslike.
It was a hell of a struggle and sometimes even dangerous to gear back up afterward.
I wonder if the numbers still work for this project? I assume ethylene is normally a constituent of crude, and is a product of conventional refining?
Sasol approves plan for $8.1 billion ethane cracker near Lake Charles
Are you thinking perhaps of a different production unit? Ensign went into gas production a few years ago.
North Sea Ensign field delivers first gas
http://www.offshore-mag.com/articles/2012/05/north-sea-ensign-field-delivers-first-gas.html
05/08/2012
Nope. Ethylene primarily comes from ethane, a natural gas liquid and separated from the raw natural gas stream at the processing plant.
This time around, the chinese will get cutting edge directional drilling and fracking rigs at fire sale prices.
In the meantime, OPEC, the russians, and the chinese have the wherewithal to patiently starve out the US oil market. They know that US investors cannot see past a fiscal quarter, and cannot take a loss in one quarter without panicking and dumping stocks like rats jumping off of a sinking ship.
Saudi has the cash reserves, not to sure about most of the others in OPEC. China is a importer, not an exporter of oil. They will benefit while the prices are low.
My information about Ensign came from this video, which I watched over the weekend. I erroneously thought that it was recent.
The video actually covers two North Sea rigs: Ensign, and another one called F3FA.
I get the feeling that there's so much petro still to be discovered that it's going to be a long time before Mr. Fusion becomes cost-effective.
Of course, there are lots of smart people working on their garages, so you never know.
Plenty of oil left. While it’s available from our “friends” we should not consume our own.
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