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EIA: Shale Oil Production Cuts to Get Bigger Next Month

The U.S. lost about 1 percent of the oil production flowing from its shale formations this month, and the decline is just starting. (Bloomberg) — The U.S. lost about 1 percent of the oil production flowing from its shale formations this month, and the decline is just starting. Output from the prolific tight-rock formations such as North Dakota’s Bakken and Texas’s Eagle Ford shale will slide 54,227 barrels a day this month, based on Energy Information Administration estimates. It’ll fall another 86,000 barrels in June to a five-month low of 5.56 million, the agency said Monday. Last year’s plunge in crude prices led to the steepest and most prolonged retreat from U.S. oil fields on record. Drillers have idled more than half the country’s rigs and eliminated tens of thousands of jobs. Some of the country’s largest shale producers including ConocoPhillips and EOG Resources Inc. have said spending cuts […]

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EIA: Oil output from major US shale to fall 86,000 b/d in June

Crude oil production in June from seven major US shale plays is expected to decrease 86,000 b/d compared with May to 5.6 million b/d, about even with where the total stood in March, according to the US Energy Information Administration’s latest Drilling Productivity Report (DPR). The DPR focuses on the Bakken, Eagle Ford, Haynesville, Marcellus, Niobrara, Permian, and Utica, which altogether accounted for 95% of US oil production increases and all US natural gas production increases during 2011-13. The total June decline comprises a 47,000-b/d loss in the Eagle Ford to 1.6 million b/d, a 31,000-b/d loss in the Bakken to 1.3 million b/d, and a 16,000-b/d loss in the Niobrara to 411,000 b/d. The Permian has maintained production growth over the past few months, albeit at a shrinking rate. Output from the basin in June is expected to increase 7,000 b/d—a third of total growth for April—to 2.1 […]

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Russia Was Right: Shale in Europe Has Proved a Dud

Workers prepare pipes used in the drilling of shale gas at a rig operated by Exalo Drilling SA in Lubocino, Poland. Photographer: Bartek Sadowski/Bloomberg When Cuadrilla Resources Ltd. opened an office in Poland in 2009, it had a reason to be optimistic: the shale boom was transforming the U.S. into the world’s largest producer of natural gas. To the companies rushing to imitate that success in Europe, Poland looked like the next Texas. Six years later, the U.K. explorer has yet to drill its first Polish well — and that’s in the country that’s most eager to allow hydraulic fracturing in Europe. The so-called super-majors like Exxon Mobil Corp., Chevron Corp. and Royal Dutch Shell Plc have packed up and moved on. “It’s not easy,” said Marek Madeja, Cuadrilla’s director of well services in the country. “The costs of drilling in Europe are much, much higher than in the […]

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Some U.S. oil drillers see more output, but not by much

At least half a dozen U.S.-focused energy firms say they will pump more oil and gas this year than initially expected, adding to a sense that eager drillers are quickly pivoting from months of retrenchment toward renewed growth. A closer look at the figures, however, suggests upgrades to their full-year output forecasts reflect minor adjustments rather than an emerging trend. At most they add up to around 50,000 barrels per day (bpd), according to data compiled by Reuters. On the low end, they might be shy of 20,000 bpd. They came from companies as large as Occidental Petroleum, which pumped nearly 200,000 bpd or over 2 percent of U.S. crude in the first quarter, and as small as Carrizo Oil & Gas Inc., which produced about a tenth as much. To be sure, brighter outlooks were not the norm. Bellwether shale firms including EOG Resources and Whiting Petroleum Corp […]

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Oil production declines deepen in June as productivity rises: EIA

NEW YORK Oil production declines from the largest U.S. shale plays will deepen for the second consecutive month in June even as rig productivity is accelerated, the U.S. Energy Information Administration said on Monday. The projected fall of some 71,000 barrels per day in June to 4.97 million bpd underscores how quickly production rates have declined after the worst price slump since the financial crisis and the start of the shale boom. Oil production from the Permian Basin of West Texas and New Mexico is forecast to rise 7,000 bpd to 2.06 million bpd, according to the EIA’s drilling productivity report, the smallest increase since June. Production per rig in the region is set to jump by 26 bpd, the biggest level in at least eight years. Meanwhile, production from the Bakken formation of North Dakota is projected to fall 31,000 bpd to 1.27 million bpd, while production per […]

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Rig data paints mixed U.S. oil picture

The number of rigs in service in top oil producing U.S. states are on the decline as low crude oil prices crimps spending. Photo by Calin Tatu/Shutterstock HOUSTON, May 11 (UPI) — State and industry data show the number of rigs actively exploring for or producing oil and natural gas in the top three U.S. producing states declined. North Dakota state data show 84 active drilling rigs in service as of Monday. That’s down from the 86 reported last week, 108 year-on-year and the lowest on record for the state in more than five years. Oil companies are spending less on exploration and production because crude oil markets have been depressed for nearly a year. That leaves energy companies with less capital to invest in exploration and production. North Dakota produced 1.17 million barrels of oil per day in February, the last full month for which data are available. […]

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Noble grabs Texas shale in $2.1 billion deal

Noble Energy makes $2.1 billion grab for Texas shale reserves. File Photo by photostock77/Shutterstock. HOUSTON, May 11 (UPI) — Noble Energy Inc. said Monday it was moving into two Texas shale basins with the $2.1 billion acquisition of rival Rosetta Resources. Noble moved to acquire all the common stocks of Rosetta Resources, which hold more than 100,000 net acres in two premier Texas shale basins . "I am excited to announce this strategic transaction which adds two exceptional and material areas to our global portfolio," Dave Stover, Noble’s top executive, said in a statement. "The Eagle Ford and the Permian are premier unconventional resource plays, two of the most economic in the United States, which will expand our resource base and development inventory and further diversify our portfolio." Texas is the No. 1 oil producer in the nation. The Railroad Commission of Texas, the state’s energy regulator, said preliminary […]

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U.S. Conditionally Approves Shell Arctic Drilling Plan

ENLARGE Royal Dutch Shell hopes to use this oil rig for exploratory drilling in the Chukchi Sea, off the West Coast of Alaska. Photo: DANIELLA BECCARIA/ASSOCIATED PRESS The U.S. government on Monday conditionally approved a plan by Royal Dutch Shell RDSA -0.97 % PLC to drill in the Arctic Ocean this summer, removing one of the biggest obstacles the energy company must overcome before it can explore for oil and natural gas in the Arctic’s frigid, isolated waters. The conditional approval from the Interior Department is contingent on Shell obtaining several additional federal permits, approvals Shell hopes government officials will make in the coming weeks. “We’d like to see them sooner rather than later,” Shell spokesman Curtis Smith said Monday. “We’re moving assets and people as if we’re going to achieve those permits. We have reason to believe we will.” Other obstacles, including ongoing legal battles brought by environmental […]

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This $2.1 Billion Shale Deal Will Be the First of Many

Where the Opportunities Are in Energy Stocks The first major shale deal after the worst oil price collapse in five years is a model for future transactions that promises to quickly change the industry as companies expand in new areas or soak up struggling rivals. Noble Energy Inc.’s $2.1 billion all-stock purchase of Rosetta Resources Inc. is poised to be an opening salvo in a long-predicted wave of industry consolidation that’s been slow to materialize since crude fell by more than half since June. As a stock-for-stock deal, Rosetta shareholders would see the benefit from a rebound in oil prices, a key sticking point after the value of North American energy companies fell by more than $200 billion since June, according to data compiled by Bloomberg. “Both shareholders then get to participate in the upside going forward,” Noble Chairman and Chief Executive Officer Dave Stover said Monday in an […]

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Bakken Formation Still Has 6 Billion Barrels of Oil

How much recoverable oil does the Bakken Formation have? The most recent estimate of proved reserves is just under 6 billion barrels for the entire Williston Basin, which includes the Bakken, and another 3.5 billion to 4.1 billion barrels of “undiscovered and technically recoverable” oil. Harold Hamm, founder and CEO of Continental Resources, once said he believed there were 24 billion barrels of oil in place in the basin. That size of this resource has been lost during the discussion of whether the price of oil will shut down fracking in the region. Eventually, as global demand for crude continues at or near historical highs, the oil from the region will be produced and shipped to refineries. And with the price of oil moving back up, that could happen sooner and not later. One sign of the possible contribution of the formation is the amount of oil that comes out of North Dakota […]

Posted On : Published By : Tom Whipple