Archive for the ‘natural gas’ Category

You know what blows up besides oil? Just about everything

Since I’m based in California and work the last US shift of the day with the Platts Central Editing Desk, it falls to me to watch for possible news items as the sun rolls out of the American sky and into Asia.

So nearly every evening, unless I’m so flat out with other work that I can’t, I troll Google to see if something wild has happened in the commodities world that I ought to cover for us.

This has me regularly searching for words such as “spill” and “explosion” and “fire.”

(And yes, I am absolutely expecting Homeland Security to come to my place any day now. It will be interesting to see how my company’s bean counters respond when they see the bail bond charge on my expense bill.)

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UK gas supplies comfortable, retail prices steady

The UK gas market is looking comfortably supplied at present and wholesale prices reflect this. The average daily gas price assessed by Platts across July 2014 was 37.52 pence/therm, down 5% from June’s 39.50 p/th average, and down a huge 43% from the 65.28 p/th average for July last year.

The shift downwards has been evident throughout the year. The average day-ahead price to date this year is 49.80 p/th, down 27% compared with a 67.99 p/th average across 2013 as a whole.

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Operator outputs from US oil and natural gas resource plays continues to leapfrog

Perhaps the most striking thing upstream companies revealed in their recent round of second quarter calls was the astounding production increases from US unconventional plays brought about by an array of tweaks to well drilling and completion techniques.

One tactic they’re using to eke more hydrocarbons from the ground is optimized well spacing — configuring wells as close as possible to best drain the reservoir without interference. Other techniques are placing hydraulic fracture sections or “stages” closer together and using more proppant to hold fractures open so oil and gas can flow more easily from the reservoir.

It’s taken a few years for operators to figure it all out, but about four years after they began widespread exploitation of unconventional oil plays, which are the current focus of most large companies, they are largely approaching full development mode.  In the meantime, they have seen staggering production growth, especially on the crude oil side.

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Energy politics can be tough on Massachusetts politicians

Practicing politics in Massachusetts must be like steering a ship toward a safe harbor while running away from a hurricane. Certainly Massachusetts Governor Deval Patrick, who is being battered by environmentalists, must feel that way.

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At the Wellhead: China struggles to open its energy sector to more non-state entities

China is shifting its focus on state-owned enterprise reform, but it still remains to be seen if the SOEs will make significant changes to the roles non-state entities can play. Song Yen Ling discusses China’s energy sector reform goals in this week’s At the Wellhead column from Oilgram News, and also takes a look at whether internal turmoil within China’s dominant upstream player is a hurdle to advancing projects.

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Petrodollars: The Western Canadian LNG business attempts to launch

 Exports of LNG from the US aren’t the only potential growth story for North America. LNG shipments out of Western Canada are also on tap. Ashok Dutta, in this week’s Oilgram News column Petrodollars, reviews the start-and-go status of the various projects.

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East Africa must avoid LNG delays to compete with rivals

Mozambique and Tanzania are locked in a race to be first to export gas from East Africa, so much so that the region may emerge as a strong competitor to Qatar and Australia in the battle to capture key export markets in Asia.

Geographically, East Africa is ideally placed to supply LNG to Japan, China, India and South-East Asia all of whom rely heavily on LNG imports.

LNG from East Africa should be cheaper than from Australia but such an advantage may be wiped out if Mozambique and Tanzania are unable to develop their potential before a glut of other new supplies depress prices.

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Gas Daily: Colorado’s anti-fracking ballot initiative fizzles out…for now

After some local areas of Colorado last year passed fracking bans of dubious legality — that sort of thing is generally the responsibility of the state, not a city or town — there arose a clamor for an initiative that would give localities that power. It was seen as a way to severerly limit fracking throughout the state.

It was such a hot-button issue that Democrats in the state were concerned that the issue could create rifts in the party. But all that fretting was for naught; the issue won’t be on the ballot in November.

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The changing face of global gas, or, chasing the arbitrage

The fate of US LNG import terminal projects was sealed as the amount of relatively low-cost gas produced onshore soared in the middle of the last decade. Most of them were scrapped before getting off the drawing board, but the more advanced of them, notably Cheniere’s Sabine Pass, went on to become export terminals, in a radical and apparently successful bid to salvage their backers’ fortunes.

That well-documented transformation was only made possible by the yawning price difference opening up between the depressed Henry Hub and the rest of the world.

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“Mini-trends” increasingly common in the oil industry

In the talk about oil cycle phases, one pattern that has emerged in recent years is the appearance of “mini-trends” within the industry that are often at odds with what is happening in the larger market.

As a result, data is growing increasingly complex, and even single data sets contain a “story-behind-the-story” which often makes more complete interpretations necessary and keeps journalists and researchers busy “Deciphering It All.”

Case in point — one of many — is the offshore industry which is undergoing a slump in dayrates, particularly for deep- and ultra-deep waters, while the onshore sector — which at least in the US and increasingly overseas now consists of unconventional drilling — churns ever-higher amid what is generally agreed to be a larger, unprecedented boom.

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