BIG OIL FIRMS ARE EXPLORING A NEW FRONTIER IN SHALE:PROFITS
Chevron Corp. is one of several big oil companies aiming to improve drilling methods to squeeze profits out of U.S. shale, writes Bradley Olson.
“Chevron, Exxon Mobil Corp. and Royal Dutch Shell PLC are piling into the Permian Basin, the oil-rich region straddling Texas and New Mexico that is the epicenter of the second wave of U.S. shale drilling,” The Wall Street Journal reports.
The Permian has proved challenging for smaller firms, which have so far eked out meager returns there because of high costs.
“Since 2011, the largest 30 independent U.S. shale producers spent an average of nearly $1.33 for every $1 they made drilling wells. Overall more than 120 companies have gone bankrupt,” the Journal reports.
Chevron hopes to succeed where others have failed. Using its deep pockets, the company can take more time to figure out how to bring down the cost of drilling in the Permian.
“Within a decade, Chevron estimates it may produce as much as 700,000 barrels a day in the Permian. Last year, Chevron’s output in the Permian averaged 175,000 barrels a day,” the Journal reports.
BP FORGES AHEAD WITH DEEPWATER GAS FIELD PLANS IN INDIA
BP PL and one of India’s biggest energy companies are joining forces to invest $6 billion to develop natural gas offshore India, writes Sarah Kent.
BP said Thursday it is moving forward with a partnership with Reliance Industries Ltd and plans to produce 425 million cubic feet of gas a day from deep water gas fields offshore India India’s east coast by 2020.
“It’s taken a while to develop a natural gas price to help develop these projects,” BP CEO Bob Dudley told the industry CERAWeek conference in Houston in March. “It is behind in developing these resources,” he said of India.
The Indian government last year unveiled a new formula for gas prices from deepwater projects that Mr. Dudley said provided more certainty,” the Journal reports.
GERMANY, AUSTRIA CHIDE U.S. SENATE’S RUSSIA SANCTIONS BILL
Germany and Austria on Thursday condemned the U.S. Senate’s plan to pile on sanctions on Russia, describing it as an illegal attempt to boost U.S. gas exports and interfere in Europe’s energy market, write Anton Troianovski and Emre Peker.
The Senate sanctions package would impose new restrictions on Russian actors linked to human-rights abuses, arms sales to the Syrian government or cyberattacks on behalf of the Russian government.
“What particularly angered Austria and Germany, however, is a section of the bill that would allow President Donald Trump to sanction some companies that participate in the construction of Russian energy export pipelines,” the Journal reports.
The sanctions could have an affect on the construction of Nord Stream 2, a Russia-to-Germany pipeline under the Baltic Sea that would boost Russian gas exports to Europe.
Germany and Austria support the pipeline expansion, though much of Europe stands against it.
U.S. producers are trying to send more liquefied natural gas to Europe, effectively competing with Russian gas for market share.
Oil prices rose Friday as the market tried to find a new bottom just days after plummeting to their lowest levels of the year.
Brent crude, the global benchmark, was up 0.9%, at $47.32 a barrel, in London midmorning trading. On the New York Mercantile Exchange, West Texas Intermediate futures were trading up 0.5%, at $44.70 a barrel.