Now this article Don saw over at joannenove.com, link here, from August 21, 2019.
The chief executive of Australia’s largest steelmaker, BlueScope, says much cheaper energy in the United States is a major driver of the company’s preparedness to invest in a $1 billion expansion of its star performer, the North Star steel mill in Ohio.But look at this:
North America was providing far more growth opportunities than Australia, Mr Vassella said.
He said energy prices in the US were only a third of those in Australia and New Zealand, and that was a big plus, along with North Star’s proximity to customers and the strong market for steel products, which has benefited from trade sanctions that favour US steelmakers in supplying automotive companies and building products.
“It’s part of the package of a competitive business model,” he said. “We’re still paying too much for energy in Australia.”
...the $1 billion expansion of the North Star mill, to be fully up and running by 2023, was the largest capital investment the steelmaker would likely ever make…
While Mr Vassella renewed his criticism of Australia’s energy market, again joining the legion of key manufacturing bosses to condemn high domestic energy prices and call for a domestic gas reservation policy to drive down local power prices, he said energy prices did not play a role in BlueScope’s decision to expand its US presence.I had a bit of difficulty following Mr Vassella comments regarding energy prices ... but the bottom line is that the CEO of Australia's largest steelmaker we weren’t ever going to put another steel mill in Australia. And their $1 billion expansion will be in Ohio.
“Let’s be clear: we weren’t ever going to put another steel mill in Australia — it wasn’t an Australia versus the US decision, it’s probably more of a statement about how business-friendly it is in the US,” he said.
I assume both Bernie Sanders and Pocahontas will do what they can to stop this -- in the name of global warming. For those who missed it, both Crazy Bernie and Pocahontas have said "when" they are elected president, they will revoke the permits for both the Keystone XL and the DAPL.
Woah Trigger. The graph says that OH will make as much NEW oil and gas (i.e. from new fields, whatever that means) as Russia. It doesn't say it will make as much oil and gas. That would be rather hard considering Russia makes about 90% of the oil and gas the entire US makes!
ReplyDeleteOH is interesting to follow wrt oil. There are parts of the Utica (Guernesy county) that have the right combination of depth to give you decent amounts of oil. In general, the Utica is either too deep and the oil was cooked to gas...or too shallow and lacks pressure drive. But in that one county, there are some great wells. For example the Purple Hayes extended reach shale well has done over 600,000 bo return (and it's only a few years old).
https://shaleprofile.com/2019/07/17/us-update-through-march-2019/ (you will have to select OH in the basin tab AFTER shifting to well quality or record cums or the like.) Note that the AVERAGE Guernsey county 2018 well is doing over 200,000 bo cum in 12 months. Those are competitive with the Perman or Bakken. (But there are less than 50 of these wells, so presumably the sweet spot is very small.)
In addition, the state as a whole has some contribution to oil production. Over 70,000 bopd now (more than MT). In terms of Appalachian states, it has more oil than WV (~40 thou) or PA (~20 thou).
Probably would be above 100,000 if prices had not collapsed after 2014. You can definitely see the state affected by price crashes in 2014 (and even 2016). Because the population of wells is so new, the decline is fast when drilling stops. (Even a dip after the little OCT18 crash is visible.)
https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=mcrfpoh2&f=m
1. You are exactly correct with regard to the graph. I completely misread it. Thank you. I will update the post with a correction.
Delete2. The Ohio story is interesting. Even with misreading the graph I'm impressed that such a small state compares with Russia with regard to "new oil and gas."