Low oil prices hurting some US shale operations; slumping oil prices putting pressure on drillers

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by Nick Cunningham of Oilprice.com. The number of active rigs drilling for oil and gas fell by their most in two months, according to the latest data from oil services firm Baker Hughes. There were 19 oil rigs that were removed from operation as of Oct. There are now 1,590 active oil rigs, the lowest level in six weeks. We could easily see the oil rig count down 100 by the end of the year, or more.”

The Next Oil Price Spike May Cripple The Industry

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Two diametrically opposed views dominate the current debate about where the oil price is heading. On the one hand, there is the view that the price of oil will be “ lower for longer ”, or even “ lower forever ”, as the electrification of transport will eat away at oil demand more and more while, at the same time, technological innovation ( shale in particular ) will greatly increase economically recoverable resources. Market Background Oil Opinio

2017 163
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Oil Well Strippers Suffering From Low Oil Prices

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by Michael McDonald of Oilprice.com. With OPEC breaking down and any kind of coordination among its members on price cuts looking increasingly unlikely, it now appears that oil prices could remain below $50 a barrel for a year or more. A stripper is a small operator of very old oil wells that frequently produce less than five barrels per day of oil. billion barrels of oil and 18.8 Mcf of natural gas.

2015 183

$10-Trillion Investment Needed To Avoid Massive Oil Price Spike Says OPEC

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by Nick Cunningham of Oilprice.com. OPEC says that $10 trillion worth of investment will need to flow into oil and gas through 2040 in order to meet the world’s energy needs. The OPEC published its World Oil Outlook 2015 (WOO) in late December, which struck a much more pessimistic note on the state of oil markets than in the past. From there, it sees oil prices rising slowly, hitting $95 per barrel in 2040. So what are we to make of this?

2015 183

Opinion: Oil Price War May Benefit both US Shale and Saudi Arabia

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Even as financial commentators on CNBC are starting to come around to the idea of a bottom in oil prices, the key question for US oil producers remains one of timing. How long will the oil price slump last? After the oil price crash in 1985, it took almost twenty years for prices to revert to previous levels. If oil does not return to $100 a barrel until 2035, there will be a lot less shale companies around. Oil Opinio

Opinion: This Is What Needs To Happen For Oil Prices To Stabilize

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Dan Doyle is president of Reliance Well Services, a hydraulic fracturing company based in Pennsylvania. On September 10 th , the EIA reported a production decline in the Lower 48—essentially shale production—of 208,000 BOPD (barrels of oil per day). That is a staggeringly enormous number, approximately 10 percent of the estimated global over-supply. Rather, Goldman Sachs was grabbing all the headlines with its $20 call on oil. All of it.

2015 205

Lux Research: Cost of replacing a barrel of produced oil up 350% in 13 years

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The cost associated with replacing a barrel of produced oil has risen from $6 per barrel in 1998 to $27 per barrel in 2011, according to Lux Research—an increase of 350%. Upstream spending is back to pre-2008 levels as producers, excluding NOCs (national oil companies) and OPEC organizations, are expected to spend close to $270 billion in 2013. Unconventional oil will be a key area of focus for producers. will be in the oil sands.

2012 198

Biosyncrude Gasification Process Could Produce Motor Fuel at Cost of Around $3/gallon

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Overview of the Bioliq process. The Bioliq biosyncrude gasification process ( earlier post ) used in a large plant with a capacity of > 1 Mt/a can produce biosynfuel for about €1.04 A crude oil price of US$100/bbl results in an approximate cost of €0.56/L (US$2.72/gallon US) without tax for conventional motor fuel. Biomass is pyrolized to a pyrolysis oil. Because of the high gasification temperature (above ca.

2009 150

GlobalData: COVID-19 puts EV sales and CO2 fleet emission targets at risk

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GlobalData research shows that lower oil prices as a result of the COVID-19 crisis could reduce electric vehicle demand and impair EU efforts to significantly reduce average new vehicle CO 2 emissions in the European car market. GlobalData’s analysis suggests that low oil prices will lead to a longer waits for the reduced fuel costs offered by electric vehicles (EVs) to amortize their higher purchase prices.

2020 262

IHS Markit: US oil production growth heading for a major slowdown, as capital discipline and weak prices play out

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US shale production—the chief source of rapid growth that made the United States the world’s largest oil producer—is slowing down fast, says a new report by IHS Markit. The new IHS Markit outlook for oil market fundamentals for 2019-2021 expects total US production growth to be 440,000 barrels per day (b/d) in 2020 before essentially flattening out in 2021. The key challenge for producers now is to meet investors’ new focus on return of capital.

2019 163

US Shale Is Now Cash Flow Neutral

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by Nick Cunningham of Oilprice.com. Oil prices are probably already high enough to spark a rebound in shale production. The IEA says that in the third quarter of 2016, the US shale industry became cash flow neutral for the first time ever. Even when US oil production hit a peak at 9.7 million barrels per day in the second quarter of 2015, the industry did not break even. Of course, OPEC cheating is a possibility. Market Background Oil

2016 202

Multiple Trends Turning Slowly Against Oil, Says Rocky Mountain Institute

Green Car Reports

The cost of a barrel of oil is now just a fraction of what it was several years ago, and fuel prices have mostly fallen across the globe as a result. Oil prices rise and fall, but most industry analysts suggest that the emergence of North American production has loosened OPEC's ability to set prices unilaterally.

2016 93

Petrobras says it is expanding oil and gas production in the pre-salt in “economically viable” manner

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Responding to press articles saying that the collapse of the global oil price is threatening oil and gas production in the off-shore Brazil pre-salt layer, Petrobras countered that it is expanding its production capacity “in an economically viable manner.” Inclusion of the latter spending may raise the total figure by US$5 to US$7 per barrel, Petrobras said. On Tuesday, 6 January, the price for WTI crude closed at $47.93/bbl, while Brent crude closed at $51.10.

2015 181

Huge Backlog Could Trigger New Wave Of Shale Oil

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By Nick Cunningham of Oilprice.com. The number of drilled but uncompleted wells (DUCs) in the U.S. That leaves a rather large backlog that could add a wave of new supply, even if the pace of drilling begins to slow. The backlog of DUCs has continued to swell, essentially uninterrupted, for more than two years. The total number of DUCs hit 8,723 in November 2018, up 287 from a month earlier. The latest crash in oil prices once again raises this prospect.

2019 205

Sasol bails on $13-$15B US GTL project, divests from Canadian shale; no new greenfield GTL

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In January 2015 Sasol announced it was delaying a final investment decision on the proposed project near Lake Charles, Louisiana to conserve cash in response to lower oil prices. The estimated cost of the project ranges between $13 billion and $15 billion. We also see further opportunities to high-grade the value from our GTL molecules through base oils extraction, and we will continue to license and support our FT technology.

2017 150

IHS Markit: conventional oil & gas discoveries at lowest levels in 70 years; major rebound unlikely

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Conventional oil and gas discoveries during the past three years are at the lowest levels in seven decades and a significant rebound is not expected, according to a new report by global business information provider IHS Markit. The low levels in discoveries come as a result of a pullback during the past 10 years in the wildcat drilling that targets conventional oil and gas plays—most drastically after oil prices collapsed in 2014.

2019 183

Lux Research projects methanol-to-gasoline most competitive route for liquid fuels from natural gas or waste

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The price disparity between crude oil and other resources, coupled with the emergence of cheap and abundant shale gas, especially in the United States, is opening up opportunities to produce cheaper gasoline, according to a new report from Lux Research. Lux Research analysts studied the cost of 21 biomass-to-liquids (BTL) and gas-to-liquids (GTL) processes.

2013 206

EIA AEO2015 projects elimination of net US energy imports in 2020-2030 timeframe; transportation energy consumption drops

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The Annual Energy Outlook 2015 (AEO2015) released today by the US Energy Information Administration (EIA) projects that US energy imports and exports will come into balance—a first since the 1950s—because of continued oil and natural gas production growth and slow growth in energy demand. The United States has been a net importer of energy since the 1950s. trillion cubic feet (Tcf) in the Low Oil Price case to 13.1

2015 195

EIA expects US motor fuel consumption to increase this summer, but remain below 2019 levels

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The US Energy Information Administration (EIA) forecasts an increase in demand for petroleum products during the 2021 summer driving season as the impacts of COVID-19 diminish in the United States. EIA’s annual Summer Fuels Outlook, released today with EIA’s Short-Term Energy Outlook (STEO), expects a 15% increase in US highway travel this summer but still less highway travel than in the summer of 2019. per gallon this summer, compared with last summer’s average of $2.07/gal.

2019 172

IRENA report finds renewable power costs at parity or below fossil fuels in many parts of world

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The cost of generating power from renewable energy sources has reached parity or dropped below the cost of fossil fuels for many technologies in many parts of the world, according to a new report released by the International Renewable Energy Agency (IRENA). Solar photovoltaic (PV) is leading the cost decline, with solar PV module costs falling 75% since the end of 2009 and the cost of electricity from utility-scale solar PV falling 50% since 2010.

2015 303

Oil Majors’ Costs Have Risen 66% Since 2011

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by Nick Cunningham of Oilprice.com. The oil majors reported poor earnings for the fourth quarter of last year, but many oil executives struck an optimistic tone about the road ahead. Oil prices have stabilized and the cost cutting measures implemented over the past three years should allow companies to turn a profit even though crude trades for about half of what it did back in 2014. That does not seem like the end of the world.

2017 163

Comprehensive modeling study finds electric drive vehicle deployment has little observed effect on US system-wide emissions

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The results of a new, comprehensive modeling study characterizing light-duty electric drive vehicle (EDV) deployment in the US over 108 discrete scenarios do not demonstrate a clear and consistent trend toward lower system-wide emissions of CO 2 , SO 2 , and NO x as EDV deployment increases. While previous work has applied different methodologies and models to quantify the environmental benefits of EDVs, several consistent insights have emerged.

2014 206

Indianapolis plans to add 425 PHEVs and BEVs to municipal fleet by 2016

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The City of Indianapolis will upgrade 425 non-police-pursuit sedans in its muncipal fleet to plug-in hybrid and battery electric vehicles by early 2016, cut the size of the fleet by 100 vehicles, and save $8.7 The Indy fleet would be the largest municipal fleet of electrified vehicles in the US. The cars will be distributed throughout the fleet based on the needs of city fleet drivers and their departments, and be branded as Indy’s “Freedom Fleet”.

Opinion: Saudi Oil Strategy: Brilliant Or Suicide?

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In the last quarter of 2014, in the face of possible oversupply, Saudi Arabia abandoned its traditional role as the global oil market’s swing producer and therefore it role as unofficial guarantor of existing ($100+ per barrel) prices. In October, Saudi sources first prepared the market with statements that the country would be comfortable with oil prices as low as $80 per barrel for “a year or two.” Racing to Barrel Oil.

2015 249

ADB approves $240M to help Kazakhstan modernize transport, improve connectivity

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The project will reconstruct and upgrade about 299 km (186 miles) of a deteriorated section of the Aktobe–Makat road in the western part of the country, and introduce a modern transport information system to increase road traffic safety and logistics effectiveness. It will also establish fast transportation links connecting Astana and Aktobe with the major oil and mineral–rich city of Atyrau, and the country’s only international commercial seaport in Aktau.

Purdue analysis finds H2Bioil biofuel could be cost-competitive when crude is between $99–$116/barrel

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The Purdue University-developed fast-hydropyrolysis-hydrodeoxygenation process for creating biofuels—H 2 Bioil ( earlier post )—could be cost-competitive when crude oil prices range from $99 to $116 per barrel, depending upon the source of hydrogen, the cost of biomass and the presence or absence of a federal carbon tax, according to a new study by the Purdue team. Stone Distinguished Professor of Chemical Engineering.

2012 206

Navigant forecasts global medium- and heavy-duty alt powertrain sales to exceed 820K units in 2026

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According to a new forecast report from Navigant Research, global commercial alternative powertrain medium- and heavy-duty vehicle (MHDV) sales will grow from about 347,000 vehicles in 2016 to more than 820,000 in 2026, representing a CAGR of about 9%. Whereas fuel cost used to be a major driver for fleet managers, the lowering of oil prices and the availability of low-cost natural gas has reduced this concern, Navigant notes.

2016 150

Global Bioenergies reports first production of green isobutene at demo plant

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Global Bioenergies is now entering the final phase of demonstrating its technology for converting renewable carbon into hydrocarbons. The first trials on the demo plant in Leuna were successfully completed, within schedule, in the fall of 2016 and Global Bioenergies announced first production of green isobutene via fermentation. Isobutene—one of the main petroleum derivatives—is a platform molecule.

2016 212

Study finds that dry-feed gasification for coal-to-liquids is more efficient, lower-emitting and cheaper than slurry-feed; CCS cost-effective for reduction of CO2

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Comparison of coal consumption and CO 2 emissions for co-production and separate production of liquids and power. The liquids output capacity of CTL plants is 50,000 barrels/day. The main reason for the better performance and economics of the dry-feed [Shell] system is the larger fraction of CO and H 2 , the main reactants in a FT reaction, in the gasifier products compared to the GE system.

2010 202

Why Is The Shale Industry Still Not Profitable?

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By Nick Cunningham of Oilprice.com. Echoing the criticism of too much hype surrounding US shale from the Saudi oil minister last week, a new report finds that shale drilling is still largely not profitable. Not only that, but costs are on the rise and drillers are pursuing “irrational production.”. Riyadh-based Al Rajhi Capital dug into the financials of a long list of U.S. Market Background Oil Oil Shale

2018 186

ICCT updates US airline fuel efficiency rankings; Alaska stays on top, American on bottom

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The International Council on Clean Transportation (ICCT) has released its annual update on the fuel efficiency of US airlines. The report, which covers US airlines in domestic operations in 2014, highlights a continuing gap in the carbon intensity of US carriers, and comes as the International Civil Aviation Organization (ICAO) meets in Montreal to debate proposals that will serve as the basis for future US regulation. A higher FES denotes higher fuel efficiency, and an FES of 1.00

2015 212

Navigant forecasts global annual natural gas vehicle sales to reach 3.9M in 2025, up 62.5% from 2015

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Navigant forecasts that the number of light-duty NGVs on the world’s roads will double by 2025 to 39.6 of all LDVs. Overall, Navigant expects the worldwide market for light-duty NGVs to grow at a compound annual growth rate (CAGR) of 4.3% Due to the incremental costs of NGVs, limited fueling infrastructure, reduced utility, and progress on competitive electrification technology, Navigant expects only modest LD NGV demand growth in North America.

2015 150

Global biofuels production up 17% in 2010 to hit all-time high of 105 billion liters

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Global production of biofuels increased 17% in 2010 to reach an all-time high of 105 billion liters (28 billion gallons US), up from 90 billion liters (24 billion gallons US) in 2009. of all global fuel for road transportation—an increase from 2% in 2009, according to the report. The two biofuel alternatives to fossil fuels for transportation largely consist of ethanol and biodiesel. The United States and Brazil remain the two largest producers of ethanol.

2011 220

Alternative Fuel Technologies, Inc. Receives New Order for DME Feed Pumps From Shanghai Diesel Engine Company

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The value of this order is confidential. Shanghai Diesel Engine Company is owned by Shanghai Automotive Industrial Corporation (SAIC), one of the top three automotive corporations in China. is a research & development organization engaged in the design, development and prototype manufacturing of advanced fuel systems for use with DME. The company’s ultima goal is series production of DME fuel systems for the global automotive market by 2011.

2010 202

The Next Big Offshore Boom Is About To Happen in Brazil

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Say what you will about offshore oil and gas exploration, but it’s still alive and kicking—high production costs and all. The latest demonstration of the viability of deepwater projects, even in the post-2014 oil industry era, comes from none other than Brazil. On Wednesday, the country’s National Petroleum Agency put 287 oil and gas blocks up for auction, and only 37 found buyers. billion —a hefty share of this pledged by heavyweight Exxon.

2017 150

GE and Sargas AS partner on gas-fired plants with carbon capture for enhanced oil recovery

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GE has concluded a commercial alliance agreement with Norway-based Sargas AS to provide a gas turbine for one of the world’s first gas-fired plants with integrated carbon capture for enhanced oil recovery (EOR). Overview of the Sargas system. The Sargas plant will combine a configuration of the existing LMS100 aero-derivative gas turbine package from GE with Sargas’ patented combustion and carbon-capture technology enabling low emissions power generation.

2012 195

MIT/UC Davis professors challenge claims that ethanol production decreased gasoline prices in 2010 and 2011

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Knittel/Smith results for implied gasoline price effects from elimination of ethanol for 2010 using Du/Hayes model and pooled-sample estimates. Two professors from MIT and UC Davis have released a paper challenging the recent claims by the Renewable Fuel Association (RFA) and US Secretary of Agriculture Vilsack that ethanol production decreased gasoline prices by $0.89 t margin for oil refiners. per gallon, a small fraction of the $0.89 Ethanol Fuels Oi

Davis 272

Global investment in renewable power reached $270.2B in 2014, ~17% up from 2013; biofuel investment fell 8% to 10-year low

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billion in 2014, nearly 17% higher than the previous year, according to the latest edition of an annual report commissioned by the United Nations Environment Program’s (UNEP) Division of Technology, Industry and Economic (DTIE) in cooperation with Frankfurt School-UNEP Collaborating Centre for Climate & Sustainable Energy Finance and produced in collaboration with Bloomberg New Energy Finance. billion of final investment decisions on offshore wind projects in Europe.

2015 218

Study finds government and vehicle manufacturers need to introduce long-term incentives and prices cuts to create sustainable market for ultra-low emission vans

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Summary of battery pack cost projections, 2010-2030. Governments and vehicle manufacturers will need to introduce long-term incentives and price cuts to create a sustainable European market for ultra-low emission vans (ULEV), according to a newly published report by Element Energy, commissioned by the UK Department for Transport. on batteries and fuel cell costs trends and the costs of vehicle mass reduction.

2012 202

IEA World Energy Outlook 2013 sees CO2 emissions rising by 20% to 2035; oil use on upward trend

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The newly released 2013 edition of the IEA World Energy Outlook (WEO) depicts a world in which some long-held tenets of the energy sector are being rewritten; importers are becoming exporters, while exporters are among the major sources of growing demand. China is about to become the largest oil-importing country and India becomes the largest importer of coal by the early 2020s. Nearly half of the net increase in electricity generation comes from renewables.

2013 232

Univ of Washington team working to make poplar coppice viable cheap, high-volume biofuel feedstock

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A University of Washington team is trying to make poplar an economically viable biofuel feedstock by testing the production of younger poplar trees that could be harvested more frequently—after only two or three years—instead of the usual 10- to 20-year cycle. The UW team is the first to try converting the entire young tree—leaves, bark and stems—into bio oil and ethanol using two separate processes. Chang Dou/University of Washington.

2017 150

Report finds Coal-to-Liquids and Oil Shale pose significant financial and environmental risks to investors

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Ceres recently released a new report concluding that coal-to-liquid (CTL) and oil shale technologies face significant environmental and financial obstacles—from water constraints, to technological uncertainties to regulatory and market risks—that pose substantial financial risks for investors involved in such projects. An increased focus on energy security and dwindling petroleum reserves are driving development of unconventional liquid fuel sources in the US.

2010 188

VTT study concludes gasification-based pathways can deliver low-carbon fuels from biomass for about 1.90-2.65 US$/gallon

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Summary of levelized production cost estimates of fuel (LCOF) for the examined plant designs. The horizontal red lines show the comparable price of gasoline (before tax, refining margin 0.3 $/gal, exchange rate: 1 € = 1.326 $) with crude oil prices 100 $/bbl and 150 $/bbl. US$/gallon US), with first-law process efficiency in the range of 49.6–66.7%—depending

2013 193