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Oil Price Crash Claims First US LNG Project Casualty

URL: http://www.rigzone.com/news/oil_gas/a/136558/Exclusive_Oil_Price_Crash_Claims_First_US_LNG_Project_Casualty MILAN, Dec 30 (Reuters) – Excelerate Energy’s Texan liquefied natural gas terminal plan has become the first victim of an oil price slump threatening the economics of U.S. LNG export projects. A halving in the oil price since June has upended assumptions by developers that cheap U.S. LNG would muscle into high-value Asian energy markets, which relied on oil prices staying high to make the U.S. supply affordable. The floating 8 million tonne per annum (mtpa) export plant moored at Lavaca Bay, Texas advanced by Houston-based Excelerate has been put on hold, according to regulatory filings obtained by Reuters. The project was initially due to begin exports in 2018. Excelerate’s move bodes ill for thirteen other U.S. LNG projects, which have also not signed up enough international buyers, to reach a final investment decision (FID). Only Cheniere’s Sabine Pass and Sempra’s Cameron LNG projects have hit that […]

Posted On : Published By : Tom Whipple
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China December factory PMIs suggest economy cooling further, more stimulus expected

BEIJING (Reuters) – China’s factory activity sputtered in December, underlining the challenges facing the country’s manufacturers as they fight rising costs and softening demand in a cooling economy. After a rough 2014, the world’s second-largest economy looks set to start the new year on a weak note, reinforcing expectations that Beijing will roll out more stimulus to avert a sharper slowdown which could trigger job losses and debt defaults. A property slump is expected to last well into 2015, companies will continue to struggle to pay off debt and export demand may remain erratic, leaving only the services sector as the lone bright spot in the economy. China’s official Purchasing Managers’ Index (PMI) slipped to 50.1 in December from November’s 50.3, a government study showed on Thursday, its lowest level of the year and clinging just above the 50-point level that separates growth from contraction on a monthly basis. […]

Posted On : Published By : Tom Whipple
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China’s December manufacturing PMI retreats

BEIJING, Jan. 1 (Xinhua) — Chinese manufacturing activity waned slightly in December but is still expanding, official data showed on Thursday. The manufacturing purchasing manager’s index (PMI), a key measure of factory activity in China, posted 50.1 in December, down from 50.3 in November, according to data released by the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing (CFLP). A reading above 50 indicates expansion, while a reading below 50 represents contraction. The PMI of large manufacturers posted 51.4, down from 51.6 in November. That of medium enterprises stood at 48.7, up from 48.4 in November, but still contracting. The PMI of small manufacturers slumped to 45.5, down from 47.6 in November, and remained in the contraction territory, the NBS said. The production sub-index posted at 52.2 percent, down from 52.5 in November. The sub-index for new orders slipped to 50.4, down from 50.9 […]

Posted On : Published By : Tom Whipple
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Some advice to those developing the Marcellus, from somebody who knows

Rodney White is wrapping up a lengthy career with Platts today, and he has watched up close the battles over developing the Marcellus and Utica shales, among other areas. Not only that, he lives in West Virginia, home to part of the Marcellus. Here are some of his departing thoughts for The Barrel. ——————— Most of the people, if not all, the people in the oil and gas industry I have worked with, have been professional and spoken truthfully about the issues that mean so much to folks who live in and around the Appalachian oil and gas fields. Some companies have gone the extra mile to make things right when things go wrong. They fix roads, clean up streams and try to be good neighbors. It isn’t easy for anyone. The Appalachian terrain is not easy to work in. The terrain is steep and narrow, hence the reason we have rock […]

Posted On : Published By : Tom Whipple
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Oilfield Housing Firm’s Stumble May Herald More Oil Industry Pain

URL: http://www.rigzone.com/news/oil_gas/a/136573/Oilfield_Housing_Firms_Stumble_May_Herald_More_Oil_Industry_Pain WILLISTON, N.D., Dec 31 (Reuters) – A nasty profit warning and deep job cuts. A gutted capital budget, a suspended dividend and shares tumbling by more than half on a single day. The retrenchment at Civeo Corp, which provides temporary housing for oilfield workers and miners, is the most-severe symptom of pain inflicted on the oil service industry by the slide in crude prices, and may presage similar steps by peers. It also exposes the transient nature of the "man camp" business of dormitory-style temporary housing the company helped pioneer. Drilling, a barometer of oilfield activity, has been slowing for weeks as producers slashed spending plans by 20 to 40 percent. Baker Hughes reported last week the U.S. land rig count fell by 35 to 1,770 and hundreds more rigs will be idled, hitting scores of services companies from ones renting trailers to those repairing pumps. The […]

Posted On : Published By : Tom Whipple
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Cheniere’s Corpus Christi LNG export project gains US FERC approval

Washington (Platts)–31Dec2014/453 pm EST/2153 GMT Federal regulators have approved Cheniere’s plan to export liquefied natural gas from Corpus Christi, Texas, following recommendations that the export facility and related infrastructure would result in minimal environmental impact if certain conditions are met. "We conclude that, with the conditions required herein, Corpus Christi Liquefaction’s project results in minimal environmental impacts and can be constructed and operated safely. Accordingly, we find that, subject to the conditions imposed in this order, Corpus Christi Liquefaction’s proposal is not inconsistent with the public interest," the Federal Energy Regulatory Commission said in an order Tuesday. Cheniere now awaits approval from the Department of Energy to export LNG from the project to countries that do not have free trade agreements with the US. DOE makes public interest determinations for energy export projects, while FERC is responsible for the export facility design, engineering and environmental footprint — a far […]

Posted On : Published By : Tom Whipple
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Do Natural-Gas MLPs Face More Downside Ahead?

Sliding oil prices have been hurting natural gas. Will the ongoing oil-price rout cause further damage to master-limited partnerships that focus on natural gas? MLPs have already gotten clobbered in recent months as the price of oil has plunged, but analysts have been quick to note that MLP performance isn’t necessarily directly correlated with oil-price trends, and that many MLPs should hold up pretty well , particularly if they’re focused on non-oil energy sources like liquefied natural gas. But Reuters reports today that the oil-price drop has claimed its first LNG-project casualty, saying Excelerate Energy’s plan for an offshore Texas liquefied natural gas terminal has been put on hold. Oleg Vukmanovic reports for Reuters: A halving in the oil price since June has upended assumptions by developers that cheap U.S. LNG would muscle into high-value Asian energy markets, which relied on oil prices staying high to make the U.S. supply […]

Posted On : Published By : Tom Whipple
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American Eagle Energy Halts Drilling Plans

American Eagle Energy Corp. said Wednesday that it has suspended its drilling operations and likely won’t resume until oil prices improve, the latest sign that a glut in crude oil is stifling exploration and production across the industry. Shares dropped 9.1% to 60 cents in light premarket trading. The stock is one of the hardest hit in the energy sector this year and approached $12 a share in November 2013. Oil prices have plummeted in the second half of 2014 as a flood of crude from U.S. shale disrupted the global oil market, leading a host of energy companies to cut drilling, lay off workers and slash spending. Earlier this month, Chevron Corp. told Canadian regulators that it had “indefinitely” suspended plans to drill for oil in Arctic waters. Energy giants ConocoPhillips and BP PLC, along with a number of smaller companies like Husky Energy Inc. and Penn West […]

Posted On : Published By : Tom Whipple
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U.S. oil export policies increasingly fluid

Commerce Department showing some flexibility in what’s permissible for oil exports under existing legislation. UPI/Shutterstock/tcly WASHINGTON, Dec. 31 (UPI) — A company planning exports of so-called condensate from the United States said it’s operating according to precedent, though laws may be on the cusp of change. Data from the American Petroleum Institute show U.S. oil production is around 9.1 million barrels per day, the highest rate in roughly 40 years and an increase of more than 14 percent from last year. The increase in oil production is a direct result of activities in shale basins, notably the Eagle Ford and Bakken reserve areas in Texas and North Dakota, respectively. Conservative lawmakers have said the increase in a production means it’s time to relax laws that restrict crude oil exports. Arab members of the Organization of Petroleum Exporting Countries in the early 1970s placed an embargo on oil exports in […]

Posted On : Published By : Tom Whipple
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Continental’s 2015 Bakken plans: $1.5 billion

Continental Resources production by geography for Q3 2014. IMAGE: CONTINENTAL RESOURCES Although Continental Resources, one of the Bakken’s most prolific producers, has reduced its 2015 operating and budgeting plans for all of its U.S.-based plays, the Oklahoma-based exploration and production firm still intends to spend roughly $1.5 billion in its Williston Basin operations. Continental had previously announced it’d be operating 19 rigs and investing $2.6 billion in western North Dakota, but, due to lower than expected crude oil prices, the firm now intends to run 11 rigs in the Bakken. The company plans to decrease its total operated rig count from roughly 50 to approximately 31 by the end of the first quarter 2015 and has decreased its previous estimated budget of $4.6 billion to $2.7 billion. “This revised budget prudently aligns our capital expenditures to lower commodity prices, targeting cash flow neutrality by mid-year 2015. This budget also […]

Posted On : Published By : Tom Whipple