07182018Wed
Last updateWed, 18 Jul 2018 2pm

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Permian Oil Production to More than Double, Exceed Expectations

Oil production in the Permian Basin, already a major force in global supply growth, will rise nearly 3 million barrels a day (mbd) by 2023—a level of growth exceeding most recent estimates, says IHS Markit. What the report describes as a “stunning” level of growth will comprise more than 60% of net global production growth during that timeframe. T

otal oil production in the Permian will be 5.4 mbd in 2023, more than the total production of any OPEC country other than Saudi Arabia. Nearly 41,000 new wells and $308 billion in upstream spending between 2018-2023 will drive that growth. Production of both natural gas and natural gas liquids (NGLs) in the Permian are also expected to double during this period, reaching 15 billion cubic feet a day and 1.7 mbd, respectively. 


Positive Outlook Projected for U.S. Chemical Industry

Following a mixed year in 2017, the foundation is set for better performance by the U.S. chemical industry in 2018, according to the American Chemistry Council’s (ACC) Mid-Year 2018 Chemical Industry Situation and Outlook. Strong global growth prospects, rising exports, an upswing in manufacturing, balanced chemical inventories, healthy demand from end-use markets and favorable shale gas economics are among the factors suggesting positive growth for this year.

The U.S. chemical industry continues to enjoy a competitive advantage from robust supplies of shale gas and natural gas liquids (NGLs), leading to significant investment in new capacity and capital spending that will continue to grow through 2023. 

U.S. LNG Exports May Double Prices by 2040

According to a new study by NERA Economic Consulting, commissioned by the Department of Energy, “exports of U.S. liquefied natural gas may double prices for the fuel by 2040, but rising output and better trade balances will soften the blow to consumers.”

Bloomberg reports that there’s “an almost 50 percent chance of gas reaching $5 to $6.50 per million British thermal units over the next two decades, the study shows. But shipments of LNG overseas will boost the U.S. economy, while higher output will meet most of the export boost.” 

BLM Expediting Oil, Gas Approvals on Public Lands

The Bureau of Land Management (BLM) issued a new policy directing its field offices to expedite its review and approval processes for natural gas and oil exploration and production projects on federal lands, consistent with the intentions of Congress when it enacted the Energy Policy Act of 2005.

The instructional bulletin issued by the BLM reminds the agency’s field offices to use existing procedures for environmental reviews under applicable federal statutes, regulations, and guidance when they review natural gas and oil projects. This action will allow stakeholders to rely on prior environmental analysis where appropriate for a more predictable and consistent process for important permit decisions. 

U.S. is a Net Energy Importer from Canada

Based on the latest annual data from the U.S. Census Bureau, energy accounted for $18 billion, or about 6%, of the value of all U.S. exports to Canada. Energy accounted for $73 billion, or about 24%, of the value of all U.S. imports from Canada in 2017, up from 19% in 2016. Canada is the main source of U.S. energy imports and the second-largest destination for U.S. energy exports behind only Mexico.

Crude oil accounts for most U.S. energy imports from Canada, averaging 3.4 million barrels per day (b/d) in 2017. Canada is the largest source of U.S. crude oil imports, providing 43% of total U.S. crude oil imports in 2017. The value of U.S. crude oil imports depends on both volume and price. In 2017, the value of U.S. imports of Canadian crude oil increased, reaching $50 billion, as a result of both an increase in oil prices and an increase in volume. Canadian crude oil imported by the U.S. is largely produced in Alberta and consists mainly of heavy grades shipped primarily to the Midwest and Gulf Coast regions. 

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