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Posts under ‘Shale Gas’

US oil reserves surpass those of Saudi Arabia and Russia

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Anjli Raval, Oil and Gas Correspondent: July 4, 2016

The US holds more oil reserves than Saudi Arabia and Russia, the first time it has surpassed those held by the world’s biggest exporting nations, according to a new study.

The US shale boom was a factor behind the recent oil price collapse that toppled the Brent crude benchmark from a mid-2014 high of $115 a barrel to below $30 earlier this year.

FULL FT ARTICLE

Royal Dutch Shell Has Served Notice – The Deepwater Drillers Are In Big Trouble

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June 23, 2016

Screen Shot 2016-05-21 at 10.18.28Summary

  • Eighteen months ago Shell was considering exiting shale plays and focusing on its deepwater and LNG opportunities.
  • Shell’s recent analyst day presentations revealed a company that is shifting its long term focus towards shale.
  • We think that going forward the offshore drilling rig companies have major long term challenges and investors need to be aware that pre-crash cash flows aren’t coming back.

For the small sliver of global oil production that U.S shale oil actually represents it certainly has been a disruptive force.

Total shale production (there is no significant amount outside of the United States) is currently somewhere around 4.5 million barrels per day.

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That is not much more than four percent of total current production which checks in at over 96 million barrels per day.

After having a look at Shell’s (NYSE:RDS.A) 2016 capital markets day presentation we think shale oil is going to become even more disruptive going forward for a select group of companies. read more

Shell works to simplify organization to compete with independents

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By Mella McEwen [email protected]: 22 June 2016

Too big. Too rigid. Not nimble enough.

Those are reasons why integrated oil companies could have a difficult time competing with independents in the unconventional shale plays that have led to a resurgence in the nation’s oil and gas industry.

Royal Dutch Shell, however, disagrees with that reasoning and this week held an event to reaffirm its commitment to the shales business, including its holdings in the Permian Basin.

Shell officials discussed how its recent $70 billion acquisition of the BG Group has impacted its outlook. The event was a mixer at Shell’s Drilling Automation & Remote Technology (DART) Center located on its Houston campus and was webcast and available by telephone. read more

Shell Sees Strong Potential for Permian Basin Assets

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Bruce Palfreyman, general manager of Shell’s Permian asset group, said the company believes it has the best position in the Delaware, part of the Permian Basin in West Texas, in terms of size and rock quality. The company holds 300,000 net acres in the Delaware through its joint venture with Anadarko Petroleum Corp., with more than 5,000 future well locations on a risk basis.

Shell acquired the acreage in 2012 from Chesapeake Energy, and has spent the past three years maturing and de-risking the acreage, Palfreyman told reporters during a media event Monday in Houston to outline Shell’s strategy on its unconventional oil and gas business. The company has pursued a high-grade strategy for its Permian acreage, selling off peripheral acreage. Shell’s position in the Delaware contains 2 billion barrels of oil. read more

Shell puts revamped shale arm at heart of growth drive

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Having turned round its North American shale business, Royal Dutch Shell (RDSa.L) is putting so-called unconventional energy at the heart of its growth plans, and believes lessons from the revamp can be applied across the company.

Greg Guidry, head of the Anglo-Dutch group’s unconventionals business, told Reuters a drive to slash costs and streamline decision-making had put his division largely on a par with leading rivals in terms of productivity and efficiency.

And now the rest of Shell could reap the benefits too. read more

Shell Gas Director Says World Isn’t Oversupplied With LNG Yet

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By Lynn Doan: June 10, 2016 – 10.52 PM BST

Screen Shot 2016-06-06 at 10.26.15For months, banks including Citigroup Inc. have talked about a massive oversupply in the global market for liquefied natural gas. The head of natural gas at Royal Dutch Shell Plc, one of the world’s biggest producers of the fuel, would beg to differ.

“There isn’t really yet the kind of oversupply that people talk about,” Maarten Wetselaar, Shell’s integrated gas and new energies director, said on Friday in an interview in Palo Alto, California. For proof, he said, look at Europe, where natural gas demand gained last year and LNG imports from overseas were little changed. read more

Inaccurate predictions of when oil production won’t meet demand

Screen Shot 2016-05-20 at 13.11.39By John Donovan

Retired Shell Oil President John Hofmeister (right) will say practically anything to get quoted in the news media, presumably in the hope of raising his public profile. 

CNBC is today reporting his prediction that oil production won’t meet demand in 5 yearsFor some reason, he consistently tries to talk up the price of oil. 

Those of us with good memories may recall a similar reckless prediction made by his former Shell boss, Jeroen van der Veer. 

As reported in the Times newspaper article below (published in January 2008), Mr. van der Veer said that oil and gas demand would outstrip supply within 7 years. In other words, by 2015.  read more

Goodbye Marvin Odum

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Screen Shot 2016-02-24 at 17.16.30Marvin Odum, unconventional resources director and U.S. country chair for Royal Dutch Shell, left the company. He joined Shell as an engineer in 1982. Concurrent with his departure, and in a move that will simplify Shell’s structure, the Athabasca Oil Sands Project and the Scotford Upgrader in Canada will join the global Downstream organization under Downstream Director John Abbott.

In addition, the Shale Resources business will join the global Upstream organization under Upstream Director Andy Brown. As a result of these changes, the unconventional resources director position is eliminated. read more

Royal Dutch Shell Limiting Investment in Chinese Shale Gas

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By Muhammad Ali Khawar on Apr 3, 2016

Royal Dutch Shell plc. (ADR) (NYSE:RDS.A) unlike BP plc. (ADR) (NYSE:BP) is looking less enthusiastic for the exploration and production of shale gas. As reported by Bloomberg, Shell has indicated that it is not pursuing with the development of the Fushun-Yongchuan shale gas block in the China’s Sichuan province.

The news comes following BP and China National Petroleum Corporation (CNPC) latest deal for shale gas exploration in the country. Both the parties signed a production sharing contract (PSC) for shale gas exploration, development, and production in China’s Nejiang-Dazu block in the Sichuan basin. read more

An oilman’s $7 billion refresher course in the economics of drilling and climate change

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To many analysts, it looked like Odum was pushed into leaving.

Steven Mufson March 11, 2016

Marvin Odum, president of Shell Oil, was attending a meeting of the parent company’s executive committee in Singapore when word trickled in that an exploration well drilled in Alaska’s Chukchi Sea — the crowning step in a multi-year $7 billion quest — was a dry hole.

Maybe not bone dry. In a recent interview, Odum wouldn’t say. But in the oil business glossary, a dry hole is one that can’t pay off commercially, and Shell’s hole definitely qualified. The parent company, Royal Dutch Shell, abruptly dropped any further drilling — a setback for the industry, though a relief for environmentalists.

For years, they had fought a vigorous, litigious and politically intense battle over the Chukchi. Meanwhile Shell, lured by potentially rich rewards, had overcome a couple of embarrassing rig mishaps at sea and patiently navigated the courts and the Obama administration’s permitting process. Now, geology had rendered its verdict. read more

Oil’s upwards rally

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By Ed Crooks: 11 March 2016

Oil this week continued its recent rally, with Brent crude clinging on above $40, but there was speculation that most of the gains of the past two months could be undone if Opec members and Russia failed to finalise their earlier conditional agreement to freeze production.

Reuters reported Opec sources as saying that a suggested meeting in Moscow on March 20 to confirm the deal was unlikely to take place. The critical factor is Iran; other countries say they will not meet to discuss joining the freeze unless Tehran agrees to sign up for it too. President Hassan Rouhani’s chief of staff told a conference in London that his country wanted to increase exports to regain its pre-sanctions market share before it would start talking about cuts. The same official, Mohammad Nahavandian, also sought to reassure international companies that the country would soon unveil new and improved contracts for investors in its oil and gas industry, even though the issue has raised concerns about attempts by foreign businesses to “loot Iran’s natural resources”. read more

South Africa to start shale gas exploration in next year

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Royal Dutch Shell, Falcon Oil & Gas and Bundu Gas & Oil are among five companies which have applied for exploration licenses being reviewed by South Africa’s Petroleum Agency, the regulator said on Tuesday.

The Petroleum Agency will submit its recommendations to the government by early May. The ministry of mineral resources will make the final decision on granting licenses.

“One area of real opportunity for South Africa is the exploration of shale gas,” a statement from cabinet ministers responsible for the economy said. read more

South Africa looks to shale gas future

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Shell one of the early examiners of gas potential in a country plagued by an electricity crisis

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By Daniel J. Graeber: March 8, 2016

PRETORIA, South Africa, March 8 (UPI) — The South African government said Tuesday it was expecting to reap the rewards of shale natural gas, with exploration slated as early as 2017.

Royal Dutch Shell is among the early entrants into the South African shale sector, reviewing the prospects for gas in the country’s Karoo basin.

South African Minister of Rural Development and Land Reform Gugile Nkwinti told government officials in Pretoria shale gas exploration presents a real opportunity for economic growth in the country. read more

Marvin FINALLY got called out for his incompetence

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Marvin FINALLY got called out for his incompetence.

His presiding over the disasters in the Arctic and in the $40 billion shale misadventure finally caught up with him as all those who took the fall earlier had gone and BvB finally saw him as the liability he was.

That was why he was ‘moved’ into the departure lounge position in the first place.

I cannot think of a single executive offhand who willingly got off the gravy train before their time regardless of what Corporates press writers spin. read more

The Allure Of Shale Is Wearing Off

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Screen Shot 2016-02-17 at 08.47.47By Nick CunninghamThu, 25 February 2016

Royal Dutch Shell revealed its plans to downgrade its emphasis on expensive shale operations, although it was not worded in those terms.

The Anglo-Dutch supermajor says that it would fold its “unconventional” unit (i.e. shale) into its broader upstream business. Shell also announced that Mavin Odum, long-time top official from the North American arm of Royal Dutch Shell, will retire after more than three decades at the company.

The two announcements are consistent with Shell’s decision to takeover BG, which was a large bet on LNG and offshore oil plays, particularly in Brazil and Australia. It is also evidence that Shell is deemphasizing its attention and resources on North America, where it has placed several costly bets that have soured. In 2013, Shell cancelled plans to build a $20 billion gas-to-liquids plant in Louisiana. In 2014, Shell sold off shale acreage in Texas, Colorado, and Kansas, according to Reuters, while also divesting itself of Pennsylvania and Louisiana shale gas assets. read more

Oil majors’ business model under increasing pressure

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Ed Crooks in New York and Chris Adams in London: 14 FEB 2016

Gorgon, a massive liquefied natural gas project off the north-west coast of Australia, is one of the wonders of the modern age. Its $54bn price tag makes it — in nominal terms at least — one of the most expensive engineering projects ever completed. It could also be a monument to a fading era, the last hurrah of Big Oil. In this view of the world, the price crash has been like an asteroid strike: agile shale producers can survive, but the lumbering dinosaurs of big oil are doomed. read more

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