For months, pundits have focused on rising production, mostly from US shales, sluggish demand, primarily from European stagnation and disappointing Chinese activity, aided by conspiratorial Saudi/OPEC intentions. And there is no doubt that some of this is true…last year, today, and probably over the near term. The underlying oil (physical) picture stands, roughly, at 91 …
Progress – and Challenges After some critical commentary about the program‘s progress, numerous reports have issued in recent days, proclaiming and analyzing the dramatic success of the first “commercial” gas development from China’s potentially huge shale reserves (estimated to be the world’s largest). In brief, Sinopoc (CNPC) has been producing from 21 “demonstration” wells …
Still Trial and Error! Unconventional resource leaders believe that traditional petroleum geophysics, developed over 150 years, needs a makeover to most effectively exploit shale/tight reservoirs. The behavior of hydrocarbons in extremely low porosity rock may require an understanding of hydrocarbon, water, and rock surface behavior at a near atomic level – much like the difference …
It Gets Worse!! Everybody knows about the regional energy/geopolitical enigmas – subsidized energy, power, and water driving wasteful consumption. Add the forced addition of subsidized oil-fired power as cheaply valued associated gas production tops out. Mix in the usual conflicting politics where each country has its own reason not to ‘play well with others,” and …
….and Where Natural Gas Goes, Coal Can follow (but when??)! If you believe in higher gas prices, it might be worth the effort to revisit future coal fundamentals. After a horrible few years (stocks down 70-90%), it’s extremely difficult to find a coal bull. However: 1) Natural gas, at $4.50, is, for most power generators, …
Light at the End of a L-O-O-N-G Tunnel??? Cold weather aside, the multi-year outlook for US natural gas supply looks fairly glutted, leading to a “BTU Bargain” as far as the eye can see. Even off the bottom, the 2015-2020 futures trade, between $4-4.50 per million BTUs – about a quarter of energy parity with …
Investors and operators are flocking to the region in search of cheap feedstock for refining, chemicals, and energy intensive industrial opportunities. While it is difficult to imagine shortages and delays in such an infrastructure-rich region (Keystone XL excepted!), front end projects are already falling victim to sticker shock (permitting another matter!). It’s been 25 …
Kazakhstan’s Kashagan – “…the downside of Elephant Fields” “In the beginning” (discovered in 2000), Kashagan was the most prolific oil discovery since the North Sea/Alaska fields of the late 1960s. However, as we suspect from the arduous journey to startup – high sulfur, land locked, frontier, with rudderless leadership and a corrupt resource host – …
Its not news that the Shale Revolution has the potential to bring the Glory Days back to the US Chemical Industry. – IF the industry doesn’t kill a cyclical AND secular opportunity by overbuilding domestic capacity. There are almost dozen mega (billion pound or more) expansion projects in the planning stages, but this has been …
New Solutions for US Stranded Gas? There is increasing entrepreneurial effort to monetize stranded/low value gas in North America’s oil/liquids-based basins, as well as highly mature gas wells. A range of startups, including ‘micro-refineries,’ mini-LNG, low cost micro-turbines, and lower cost compression (with higher liquids capability) are all aiming at the same opportunity. A major …