US SURPASSES SAUDI ARABIA AS THE WORLD’S TOP OIL PRODUCER

and.....we have arrived at the inevitable. Now it will be interesting to see how long the US stays at #1. Russia is sure to be nipping at the United States' heels. can the US sustain this level of production? Some are saying that US shale is unprofitable and not long for this world. 

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I have a problem with the figures. EIA says 10.9 mbd for August and adds it was higher than Russia. Russia says 11.21 mbd for the same month. The only explanation I seem to come up with is that, as the EIA says, Russia reports crude and condensate, while EIA, I gather, only reports crude. Is that right?

Anyway, they'll keep pumping as long as they can -- remember all those debts the shale boomers have to repay. I don't see output dipping for at least another year, unless the price drops, of course.

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3 hours ago, Marina Schwarz said:

I have a problem with the figures. EIA says 10.9 mbd for August and adds it was higher than Russia. Russia says 11.21 mbd for the same month. The only explanation I seem to come up with is that, as the EIA says, Russia reports crude and condensate, while EIA, I gather, only reports crude. Is that right?

Anyway, they'll keep pumping as long as they can -- remember all those debts the shale boomers have to repay. I don't see output dipping for at least another year, unless the price drops, of course.

Shale producers need to heed the warnings and play it safe, a good balance of maintaining production growth, stemming decline while making a profit, long term production sustainability and production stability while lowering costs @ all levels. Very prudent land leasing operations which acquire quality rocks at reasonable cost.

Some reporting does include crude oil, condensate, NGLs

https://www.eia.gov/todayinenergy/detail.php?id=37053

 

https://www.reuters.com/article/us-usa-oil-eia-outlook/u-s-crude-output-to-hit-12-million-bpd-in-late-2019-eia-idUSKBN1I92HT

 

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5 hours ago, Cowpoke said:

Eh, brag when you can I suppose. I gota kid graduating in December as a P.E. who will need a job;  So I am not yet tired of all the Trump admin "Winning" .

https://dailycaller.com/2018/09/12/us-saudi-arabia-top-oil-producer/

 

Good luck to you kid. Hopefully finds a job in a good company and acquires the knowledge and develops the skills to make breakthrough discoveries and or technology critical to exploration and finding resources.

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3 hours ago, Rodent said:

and.....we have arrived at the inevitable. Now it will be interesting to see how long the US stays at #1. Russia is sure to be nipping at the United States' heels. can the US sustain this level of production? Some are saying that US shale is unprofitable and not long for this world. 

The competition should not be to be @ the top and for how long but for sustained production over time and also have the capacity to "shift" production as needed due to market demands, geopolitics and overcome tech challenges in recovering and producing hydrocarbons.

We have been going from Shale 1.0-4.0 and above, the next gen shale is to watch out for, it may require new technologies, new capabilities , new services and a combination of all different existing techs and services combined in various configurations as suitable and applicable

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11 hours ago, Rodent said:

and.....we have arrived at the inevitable. Now it will be interesting to see how long the US stays at #1. Russia is sure to be nipping at the United States' heels. can the US sustain this level of production? Some are saying that US shale is unprofitable and not long for this world. 

It would be interesting to find out how most of these shale operations are financed.  If (as I suspect) most are financed by the solicitation of private subscription, the way small conventional drilling plays tend to be financed, then I anticipate that shale plays will continue to pump even if unprofitable, as the drillers will be loathe to shut off the spigot of cash flowing back to the buyers of participation shares.  The one thing that really irritates these financing share buyers is a shut-down.  Operators who do that end up alienating the money-men, and they get spurned for cash appeals for some other project.  Basically, the operator is writing himself out of the industry if he shuts down.

So you end up with these anomalous situations, in drilling plays, where the wells continue to pump even if they make no money.  That, of course, continues to send more oil into the stream of commerce, to be sold and thus displacing somebody else's oil from somewhere else. 

Think of it as an "oil war,"  and it continues until someone, somewhere, gives up and shuts down their incremental contribution to production.  Supply will always equal consumption  (which, I remind everyone, is different from "supply equals demand", which is not the case.)

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51 minutes ago, Jan van Eck said:

It would be interesting to find out how most of these shale operations are financed.  If (as I suspect) most are financed by the solicitation of private subscription, the way small conventional drilling plays tend to be financed, then I anticipate that shale plays will continue to pump even if unprofitable, as the drillers will be loathe to shut off the spigot of cash flowing back to the buyers of participation shares.  The one thing that really irritates these financing share buyers is a shut-down.  Operators who do that end up alienating the money-men, and they get spurned for cash appeals for some other project.  Basically, the operator is writing himself out of the industry if he shuts down.

So you end up with these anomalous situations, in drilling plays, where the wells continue to pump even if they make no money.  That, of course, continues to send more oil into the stream of commerce, to be sold and thus displacing somebody else's oil from somewhere else. 

Think of it as an "oil war,"  and it continues until someone, somewhere, gives up and shuts down their incremental contribution to production.  Supply will always equal consumption  (which, I remind everyone, is different from "supply equals demand", which is not the case.)

The name of the game in Shale is "JV's & P.E.'s" , joint ventures and private equity capital and a joint venture with private equity capital companies and or SOE (state owned enterprises), NOC's (national oil companies), SOV Funds (sovereign wealth funds) , and shale companies backed by and shale company management sponsored by private equity groups.

The thing in shale to be successful is to be nimble, flexible and ready to move and deploy to the next location and be able to acquire quality subsurface rocks and structures at low costs, use the right mix and suites of technologies to find the structures and drill into the structures to maximize the well bore exposure to the most volume of hydrocarbons to be pumped back to the surface, while using the best technologies for completion suitable for the permeability and porosity to be greatly increased and keeping the decline down and being able to drill more wells to overcome the declines. If the shale companies keep a vast number of variables in check to minimize costs and decrease lifting costs and are in the sweet spots (for my own operations , I use a three tier sweet spot criteria-sweetest, sweeter and sweet; shale companies are running on the sweet spots platform right now), they can make a good profit on the volume of oil produced.

Yes a shale war, in which the survival of the fittest holds true. We have seen dozens if not hundreds of companies that came into existence overnight during the 2011-2014 time period and vanished just as fast not to mention the hundreds of bankruptcies.

Shale companies have a really good shot at being profitable over a long term given the appetite by China (barring tariffs-US crude is still off the tariff list); demand from S. Ko., Japan, India and other regions and the companies from these nations have been @ the fore front of equity investments and jv structures in the US shale boom and are still willing to engage in these arrangements.

 

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September 11, 2018 / 8:32 AM / 2 days ago

Carlyle Group, Diamondback partner to develop Permian assets

 

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(Reuters) - Private equity firm Carlyle Group LP said on Tuesday it would fund the development of Diamondback Energy Inc’s oil and gas assets in the prolific Permian basin of Texas.

A Carlyle fund and Diamondback will jointly invest $620 million to develop the assets in the San Pedro area of Pecos county, Texas within the Southern Delaware basin, the companies said.

 

The Carlyle fund will invest up to 85 percent for the development program over five years and the PE firm’s interests will largely revert to Diamondback after certain performance milestones are met.

 

Diamondback’s shares were up 2.2 percent at $114.58 in morning trade.

Last month, Diamondback agreed to buy shale rival Energen Corp in an all-stock deal valued at $9.2 billion, to get an expanded footprint in the Permian, the largest and fastest growing oil field in the United States.

 

https://www.reuters.com/article/oil-prices-kemp/column-u-s-oil-boom-starts-to-cool-tightening-global-market-idINKCN1LT0BR

 

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