Yesterday at CERAWeek in Houston, Energy Secretary Chris Wright took the stage, and if you’re paying attention, he’s sending a crystal-clear message to American oil producers: slow down, or risk ruin.
It looks like operators are catching on and paying attention - at least to some degree. The rig count is stable and not skyrocketing. The replacement of production volumes and reserves with new drills is on the same pace as last quarter it appears. The intervention activity is increasing slightly and that won’t really impact overall daily production volumes but can help profit for individual properties. All in all we still need regulatory burden relief - not just cost, but bureaucratic processing relief.
The direction Chris Wright is pushing toward will work out this year, be patient and don’t make any mistakes.
Do you think LNG is going away? We are moving 17 bcfpd thru LNG shipments. I realize it's price and politically motivated but you cant ignore it. And when you add reduced gas volumes in our domestic market if we have a slowdown and oil price drop and we have continued high electricity demand, nat gas will go up and attract capital in the gas basins. This has nothing to do with the Marcellus.
No no. I didn’t say that. The opposite. I said until we have more LNG it won’t matter. And every gas price surge over 13 years has been met with supply. So good natural gas prices today are irrelevant to 3 months from now. In 3 years with more LNG gas will be able to be balanced and the Marcellus is where the supply predominantly will grow from.
Agree with your oil outlook, however, it appears you have ignored the effect it would have on Nat Gas /LNG. It would seem the pure gas basins (Haynesville, Arkoma, Mid-Con, etc) would be ripe for companies to exploit in that environment as nat gas prices would have a big lift if rig count falls in oil plays and we aren't drilling and adding as much associated gas. Marcellus gas takeaways are more pipeline restricted so can't ramp up much more. Would seem to be a boon for capital to exploit if prices rise. Thoughts?
I have ignored natural gas because at present levels, without LNG, I don’t see it as a trade. They act more independently and the companies have been Permian focused for a reason. Marcellus and gas will have to wait a few more years.
It looks like operators are catching on and paying attention - at least to some degree. The rig count is stable and not skyrocketing. The replacement of production volumes and reserves with new drills is on the same pace as last quarter it appears. The intervention activity is increasing slightly and that won’t really impact overall daily production volumes but can help profit for individual properties. All in all we still need regulatory burden relief - not just cost, but bureaucratic processing relief.
The direction Chris Wright is pushing toward will work out this year, be patient and don’t make any mistakes.
DRW at his finest! Glad you are back pal. It just isn’t as fun without your wit.
Hey David…lots of great brain energy here! Keep it coming, man, it’s good to hear a ‘positive’ note for a change. Stay kool! ❤️
Do you think LNG is going away? We are moving 17 bcfpd thru LNG shipments. I realize it's price and politically motivated but you cant ignore it. And when you add reduced gas volumes in our domestic market if we have a slowdown and oil price drop and we have continued high electricity demand, nat gas will go up and attract capital in the gas basins. This has nothing to do with the Marcellus.
No no. I didn’t say that. The opposite. I said until we have more LNG it won’t matter. And every gas price surge over 13 years has been met with supply. So good natural gas prices today are irrelevant to 3 months from now. In 3 years with more LNG gas will be able to be balanced and the Marcellus is where the supply predominantly will grow from.
David,
Agree with your oil outlook, however, it appears you have ignored the effect it would have on Nat Gas /LNG. It would seem the pure gas basins (Haynesville, Arkoma, Mid-Con, etc) would be ripe for companies to exploit in that environment as nat gas prices would have a big lift if rig count falls in oil plays and we aren't drilling and adding as much associated gas. Marcellus gas takeaways are more pipeline restricted so can't ramp up much more. Would seem to be a boon for capital to exploit if prices rise. Thoughts?
I have ignored natural gas because at present levels, without LNG, I don’t see it as a trade. They act more independently and the companies have been Permian focused for a reason. Marcellus and gas will have to wait a few more years.