Oil Glut? What Oil Glut? -- January 19, 2015

From Rigzone - Oil, Gas Output Rises In Argentina's Vaca Muerta Shale Field

Oil production in the Argentine province of Neuquen rose 6.75 percent in the second half of 2014 from the first half, due in part to increased output at the Vaca Muerta shale field.

Vaca Muerta represented 18.08 percent of the province's overall oil output of 3.4 million cubic meters in the second half, up sharply from 11.58 percent in the first six months of the year.

Covering an area the size of Belgium, Vaca Muerta is one of the world' largest shale oil and gas formations and one that Argentina is anxious to develop. Neuquen's natural gas output rose 7.35 percent in the last six months of 2014 from 8.66 million cubic meters in the first half.

Production at Vaca Muerta made up 23.77 percent of Neuquen's overall gas production in the second half versus 19.51 percent in the first. Combined shale oil and natural gas output from the Vaca Muerta formation was about 33,000 barrels of oil equivalent per day (boepd) at the end of September, with a trend toward growth.

From Rigzone -  Keppel Sees Shallow-Water Projects Supporting Rig Demand amid Lower Prices

Singapore’s rigbuilder Keppel Offshore & Marine chief executive Chow Yew Yuen believes there are still pockets of demand for oilfield services in shallow-water reservoirs where hydrocarbon production remains economical at a fraction of the current oil prices.

With oil price falling drastically within a span of four to five months from $100 to under $50 a barrel at the turn of the new year, Chow acknowledged global exploration and production activity will slow as oil and gas companies look into cutting capital expenditure.

“Some projects will move to the right [or be] put on hold,” Chow told reporters, citing projects in the deepwater basins as potentially among those coming under review.

That will potentially include Petrobras’ pre-salt discoveries off Brazil as other industry sources have indicated.

From Rigzone -  Russia's Rosneft Starts Oil Production At Arkutun-Dagi Field:

Russia's Rosneft has started oil production at the Arkutun-Dagi field, which is expected to produce 90,000 barrels per day at peak production.

The Arkutun-Dagi offshore field is part of the Sakhalin-1 project led by U.S. major ExxonMobil. 

The launch of the field, one of three operating at Sakhalin-1, should add to Russia's oil production, which hit a post-Soviet record high last year, averaging 10.58 million bpd. Two other fields in the Sakhalin-1 project, Chayvo and Odoptu, began production in 2005 and 2010, respectively.

Just keeping production levels stable is a challenging task for Russia, as its key fields in Western Siberia are depleting, while Western sanctions are making it all but impossible to raise foreign financing and bring in new technologies.

Sound bites:

• Russia producing even more oil, even as the country hits new post-Soviet production records
• Argentina's huge shale field is a success
• Brazilian shallow-sea/deep-sea projects may be delayed

******************************

At Least It's Hard To Catch

Tweeting now: hospital confirms passenger who recently traveled to 'Ebola-affected country' hospitalized after landing at Newark, NJ, airport; being kept overnight 'in an abundance of caution.'... because it's hard to catch.