Six Wells Coming Off The Confidential List Today -- February 7, 2020

Peak oil? What peak oil? Global oil, gas discoveries hit four-year high in 2019. From Rigzone.  Data points:

• 2019 was the best since 2015 for new hydrocarbon supplies -- despite low crude oil prices, and incredibly low natural gas prices
• over 13 billion bbls of new oil: off west and south Africa, in Latin America, Europe -- really, Europe?
• significant new natural gas resources: Russia, Mauritania, Iran, and Cyprus

Graphic from Rystad Energy: I wonder if the big natural gas spike in 2017 was related to Guyana? I don't know. I'm sure a reader knows.

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Back to the Bakken

Active rigs:

$50.34	2/7/2020	02/07/2019	02/07/2018	02/07/2017	02/07/2016
Active Rigs	54	63	58	40	42

Six wells coming off confidential list today -- Friday, February 7, 2020: 24 for the month; 131 for the quarter, 131 for the year:

• 36664, conf,PetroShale, Jorgenson Federal 2MBH, Bear Den, 20K first full month;
• 36425, conf, XTO, Linda 41X-22H, Capa, no production data,
• 35884, conf, Liberty Resources, Haley 158-93-29-32-1TFH, East Tioga, 18K first full month;
• 35069, conf, Resonance Exploration, Resonance Issendorf 16-10H, Russel, very small production;
• 35048, conf, XTO, Johnson Trust Federal 21X-6F, Siverston, no production data,
• 32354, conf, CLR, Hereford Federal 8-20H2, Elm Tree, very small production; it will be interesting to see what this is all about; Three Forks, second bench;

RBN Energy: changes ahead for global oil supply management? Part 2.

U.S. shale oil production and exports have contributed to global oversupply in recent years, which, in turn, has amplified pressure on OPEC to implement production cuts to keep crude oil prices from collapsing to untenable levels. That’s led to an agreement among most OPEC countries and nearly a dozen other non-member producing countries — together known as OPEC-Plus — to limit production, an accord that’s remained in place since January 2017.

However, oversupply conditions now are also prompting U.S. oil and gas producers to pull back on their planned capital expenditures for 2020, suggesting a slowdown in U.S. production growth later this year and into 2021. Recent global oil supply and demand forecasts by the International Energy Agency (IEA), the U.S. Energy Information Administration (EIA) and OPEC itself suggest that such a slowdown, if it materializes, could present a window of opportunity for OPEC-Plus to relax its quotas and potentially reclaim some of its lost oil market share, at least for a time. Today, we examine what the recent changes in monthly data from IEA, EIA and OPEC indicate about potential shifts in the OPEC versus non-OPEC oil supply and demand balance and what that could mean for OPEC’s role in meeting global demand.

Earlier, we described how OPEC-Plus, including 10 non-member oil-producing countries, have managed oil supply since January 2017 under an agreement aimed at preventing a repeat of the oil-market collapse of 2014-16. Reducing supply from the 22 OPEC-Plus countries had the intended effect of supporting global oil prices. But, as expected, OPEC members’ market share fell as a result, while the share held by non-OPEC producers has increased. Production gains in the U.S. have been the most dramatic, with crude oil production growing from 8.8 MMb/d in 2014 to 12.2 MMb/d in 2019, and domestic exports of all liquid hydrocarbons have climbed from 5.3 MMb/d to 8.5 MMb/d in the four years since the U.S. lifted its ban on most crude oil exports. However, as we noted in the previous episode, U.S. producers are now signaling a slowdown in their growth.