More drillers are turning their attention to the Meramec formation, a shale field in Oklahoma that goes head-to-head with the Permian Basin thanks to its low breakevens at around $40 per barrel, strong production levels and cheap land prices of about $7,600 per acre. Completion activity in the Meramec and the nearby Osage Shale formation surged from 18 wells at the start of 2015 to 170 in the fourth quarter of 2017, while new well production in the Anadarko Basin, which includes the Meramec, has climbed 8.6% since August, compared with a 6% jump in the Permian.
Several pipeline projects are expected to enter service in the next 12 months in the Marcellus Shale, but the competition among developers is so fierce some are having trouble getting minimum volume commitments from producers. As an alternative to MCVs, some pipeline operators are opting to pay for acreage dedications even though this often means buying a producers' existing assets at a premium, according to Eureka Midstream President and Chief Operating Officer Chris Akers.
US crude oil production growth and an expected surge in domestic frac sand demand is helping fuel a rebound in Wisconsin's frac sand industry, which was forced to shut down mines and cut hundreds of jobs during the downturn. Despite Wisconsin's industry facing rising competition from Texas mines, Ryan Carbrey, senior vice president and analyst for Rystad Energy, expects demand to grow so significantly that "there won't be a negative impact on white sand," and he even sees the price of northern white sand rising 10% to 12% this year.
Natural gas production in the Permian Basin hit a record of about 7.2 billion cubic feet per day earlier this month, but market constraints and a lack of infrastructure threaten to kill the momentum. As gas supplies from the Anadarko and San Juan basins increasingly meet demand in the Midwest and Southwest, Permian producers will be forced to look to eastern markets, but eastbound pipeline capacity from the Permian is limited at just 2.8 billion cubic feet per day.
As the Permian Basin prepares to unleash a second wave of the shale revolution, operators will need to work together and exploit the power of data analytics to get the most out of their assets, according to CrownQuest Operating data scientist and geophysicist Lewis Matthews. Matthews says enhanced oil recovery efforts could increase recovery factors in the Permian Basin from about 12% to roughly 50%.
The International Energy Agency forecast that global oil demand would jump by 1.5 million barrels per day to hit 99.3 million barrels per day this year, enough to maintain market balance in the wake of an anticipated 1.5-million-barrel-per-day increase in US crude production. "The market rebalancing is clearly moving ahead with ... supply and demand becoming more closely aligned," the IEA said in its monthly report.
The number of US oil rigs increased by four to 800 last week, with Texas, Oklahoma and North Dakota leading the gains, while Colorado, Pennsylvania and Alaska posted losses in their respective rig counts, according to Baker Hughes. Drillers also deployed two additional natural gas rigs last week, bringing the combined oil and gas rig count to 990.
Democratic State Rep. David Leland is pushing for a ban on hydraulic fracturing in Ohio's public parks and nature preserves, arguing "we've got to have little spots of land in the state of Ohio that don't have to be subjected to fracking." Leland's proposal comes just as the Ohio Oil and Gas Commission prepares to meet for the first time.
API Specification Q2 Fundamentals and Practitioner Training
This course addresses the quality management systems for service supply organizations for the upstream petroleum and natural gas industries. Participants will be given insight into the drivers behind Q2's importance and its value in the oil and natural gas industry. Using practical examples and hands-on application, this course is designed to give you introductory to advanced knowledge of Q2 requirements and interpretations. Presented by AxiomLogics, April 23 to 26, June 4 to 7; Global Management Solutions, April 24 to 27, May 8 to 11; Aston Technical Consulting Services, May 21 to 24; Mireaux Management Solutions, May 21 to 24; Qualified Specialists International, June 4 to 7. To learn more about this course and to register, visit the API-U Calendar.
2018 Spring Refining and Equipment Standards Meeting
Help develop standards for safe, efficient refining operations at the Spring Refining and Equipment Standards Meeting, April 16 to 19 in Seattle. Learn more and register.