The Weekly USA Oil & Gas Update: 6th October 2015
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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.
Learn more about Todd here
Rig Counts - select states with key plays |
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Oil & Gas Prices - Bloomberg/EIA |
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General News |
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OPEC oil production up slightly in September Saudi Arabia and most other major members of the cartel maintained production levels from the previous month, but Iraq increased its shipments of crude oil from its northern region. The Kurdish region in northern Iraq had experienced disruptions in previous months that had halted supply growth, but was able to overcome them in September and increase exports. Nigeria and Angola also slightly increased exports, while Libya's output fell due to disruptions from political unrest. Article here
US rig count drops by 29 to lowest total since May 2002 According to Baker Hughes, the US rig count has fallen 6 consecutive weeks, down to 809 total rigs. This is a drop of 1,113 from a year ago. The decrease has been primarily experienced in oil-directed rigs, which are down 977 from a year ago, while gas-directed rigs have fallen by 135 over that same time. Article here |
Unconventional Oil & Gas News |
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Can total production from shale increase by choking back wells? Encana thinks so. They are one of a growing number of producers that believe restricting initial flow on tight oil wells will increase their total recoverable hydrocarbons. The idea is that when newly-drilled wells are allowed to flow at very high velocity's during initial production, up to 2,000 bpd, the high flow rates also sweep out proppants meant to prop open cracks in the shale, thereby lowering production later in the process. "You're losing a barrel today to get two or three barrels tomorrow, said Allen Gilmer with Drilling Info. "It's not a zero-sum game." High initial production rates pay out drilling costs, and associated debt, much more quickly though, so incentive is strong to let wells produce at high rates initially, but it also means more wells must be drilled to maintain production levels. Encana and others believe that a long-term strategy, with lower initial production but higher returns over the ultimate life of the well, will get them off the continuous-drilling treadmill many producers are on at this time to maintain overall production. Article here |
Environment and Safety News |
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Federal agency makes tougher rules on pipelines The federal regulator for pipelines, the US Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA) came out with a draft of new rules on October 1 to respond to calls for increased pipeline safety. Changes include enhanced leak detection, timelines for inspections following storms and natural disasters, and improvement in the quality and frequency of maintenance tests. "The proposed rule would significantly change the way operators manage risk and promote the safe operation of the almost 200,000 miles of hazardous liquid pipelines int he United States," said PHMSA Administrator Marie Therese Dominquez in a news release. Article here |
Mergers and Acquisitions News |
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Energy Transfer to acquire Williams for $32.9 billion |
