One year later: American oil patch thriving on ingenuity, Forbes.
We’re now one year into the oil bust. For a time there was hope that this downturn would be kind of like 2009, where prices fell sharply in the wake of global economic collapse, but shot back up just as quickly – leaving little collateral damage behind.
It’s clear now that’s not going to happen. The 2009 collapse was driven by a sudden drying up of demand. This time around there’s just too much supply — especially in the United States. And it’s simply not going away. According to the Energy Information Administration, domestic crude oil output peaked in April at 9.6 million barrels per day. Since then it has slipped to about 9.2 million bpd, about where it was a year ago, when the bust began.Update on Colstrip coal plant in Billings, MT, Montana's largest coal plant; closure a foregone conclusion -- Montana Public Radio.
Coincidence?
- Reuters headline: Cost of Cheapest Obamacare Plans Is Soaring.
- Target to close 13 stores nationwide; layoffs in 2015 total about 2,500 so far, but that was mostly corporate. November 4, 2015.
- 3M to cut 1,500 workers, October 22, 2015.
- Kraft Heinz to close seven plants, cut 2,600 jobs. November 4, 2015.
- Monsanto slashing 2,600 jobs. Will exit the sugar cane business. October 7, 2015.
- ConAgra cuts 1,000 jobs; moves HQ from Omaha to Chicago. October 1, 2015.
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Active rigs:
11/5/2015 | 11/05/2014 | 11/05/2013 | 11/05/2012 | 11/05/2011 | |
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Active Rigs | 69 | 190 | 183 | 189 | 196 |
RBN Energy: Extreme Petrochemical Feedstock Margin Declines for Steam Crackers.
Falling crude oil prices and other factors have crushed margins in the steam cracker/olefin unit segment of the petrochemical industry. Margins per pound of ethylene have declined from more than 60 c/lb in October 2014 to less than 20 c/lb today (November 2015) for NGL feedstocks, including ethane. We expect some petrochemical companies might be feeling a chill in the air. That’s because five new Gulf Coast world scale steam crackers and a couple of smaller units are under construction or being developed to add still another 20 billion/lbs of capacity by the end of 2018. In today’s blog, we assess NGL feedstock margin declines.
First, a quick recap of the U.S. petrochemical industry from our March 2014 blog, “Beyond Hypothermia and Extreme Propane Price Spikes – Petrochemical Feedstock Switching 2013-14”. In the U.S. there are currently 37 steam crackers (a.k.a, olefin units or ethylene units) owned by 15 companies which soak up the vast majority of the NGLs consumed in the petrochemical sector. In aggregate, these units consume nearly 1.7 MMb/d of NGLs as feedstock, which is over half of all U.S. domestic NGL consumption. Most of these units are on the Gulf Coast. Ethane holds the largest share of the feedstock market with propane, normal butane, and naphtha (natural gasoline) holding the second, third and fourth positions, respectively. Steam crackers also use a small volume of gas oil (distillate range material) as a feedstock.
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