For me, two nice bookends for US shale:
- RBN Energy: daily posts;
- Focus Fracking: weekly posts; most recent was posted last night;
Both have incredible amounts of information but perhaps different audiences, and different perspectives.
The former concentrates on a single subject each day, whereas the latter literally breaks down the EIA weekly petroleum report to the "nth" degree and supplements it with material from other sources. The amount of information can be overwhelming but I find it easier to take it in chunks, concentrating on areas in which I have most interest. In addition, the information in the second half of the report is incredibly interesting: some politics, some updates on different operators across the country.
Because today was a holiday, I was unaware that RBN Energy would post a blog today, but they did. In fact there were two blogs that I failed to post/link from RBN Energy since before the Labor Day weekend. Here they are.
RBN Energy: US LNG as swing supply amid shifting global market balance. This is "an encore" edition. Archived.
Not long ago, the economics for U.S. LNG exports were practically a no-brainer. Despite the longer voyage times and the resulting higher shipping costs from Gulf Coast and East Coast ports to Europe and Asia — by far the biggest LNG consuming regions — LNG priced at the U.S.’s Henry Hub gas benchmark presented a competitive alternative to other global LNG supply, much of which is indexed to oil prices, which were higher then. But earlier this year, as oil prices collapsed, COVID-19 lockdowns decimated worldwide gas demand, and international gas prices plummeted, the decision to lift U.S. cargoes has become much more nuanced, and the commercial agreements to support the development of new liquefaction capacity are much harder — if not impossible — to come by. Today, we discuss highlights from RBN’s latest Drill DownReport on the impact of recent market events on U.S. export demand, capacity utilization, and new project development.
In observance of today’s holiday, we’ve given our writers a break and are revisiting a recently published blog on the U.S.’s shifting role in the global LNG market. If you didn’t read it then, this is your opportunity to see what you missed! Happy Labor Day!
In the first few years since the U.S. began to export LNG in earnest in 2016, U.S. LNG producers and offtakers enjoyed a sort of honeymoon period. The first wave of U.S. export projects was well-subscribed, with over 90% of the capacity under long-term contract. The economics made sense. Abundant and still-growing gas supplies, particularly from the Marcellus/Utica and Permian basins, kept Henry Hub range-bound and relatively low compared with global LNG prices that were indexed to higher oil prices. Additionally, growing gas demand in Asia and a tightening balance in Europe kept destination prices at significant premiums, providing attractive “arbs” (the difference between U.S. and export destination prices) and netbacks (the delivered price less the variable costs for moving a cargo) for U.S. offtakers. As additional liquefaction capacity came online in relatively rapid succession in 2016-19, utilization rates of each new capacity addition ran high, and exports grew steadily in lockstep with capacity, save for temporary reductions due to maintenance.
Obviously much more at the link.
RBN Energy: will rebounding Canadian crude production fill up pipelines? Part 3. Archived.
Western Canadian producers have been deeply impacted by lower crude oil prices and the demand-destroying effects of COVID-19. This past spring, oil production in the vast region dropped by an estimated 940 Mb/d, or as much as 20% from the record highs earlier this year. Taking that much production offline helped in at least one sense: it eased long-standing constraints on takeaway pipelines like Enbridge’s Canadian Mainline, TC Energy’s Keystone Pipeline, and the government of Canada’s Trans Mountain Pipeline. Production has been rebounding this summer, however, and there are indications that pipeline constraints may be returning and apportionment of uncommitted space on some pipes may again become a persistent issue. Today, we continue a review of production and takeaway capacity in Alberta and its provincial neighbors with a look at apportionment trends on the biggest pipelines.
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