Though the deepwater industry appears in good health, Wood Mackenzie warns that cyclical cost inflation could raise break-even costs once again. The most competitive region is the Americas, and particularly Brazil, Guyana, and the Gulf of Mexico, where over 50 billion boe of pre- and post-sanction deepwater developments are now profitable under an oil price of US$60/bbl.
Electrification can help to reduce the energy use and emissions impacts of automated vehicles (AVs). Under a best-case scenario of improved efficiency through automation and ride-sharing, road transport energy use could decrease by nearly 50% compared with current levels, the International Energy Agency (IEA) finds.
Spark Energy has become the seventh and biggest UK provider to go bankrupt this year, following the market exit of Extra Energy on Wednesday last week. Spark blamed “increasingly tough trading conditions” when the company’s debts were uncovered after it missed a deadline to make a £14 million ‘renewables obligation’ payment to Ofgem.
Radical change in Britain’s power mix is driven by the fast fall in technology costs of renewables. By 2030, a system with wind and solar supplying 50% of the country’s electricity needs would be comparable in cost to one dominated by combined-cycle gas power station, according to New Resource Partners.
Developed economies like Japan, Denmark and the United States have achieved a high economic growth with fairly constant energy consumption. If all cost-effective efficiency measures were deployed, the global economy could double by 2040 with only a marginal rise in energy demand, the International Energy Agency (IEA) finds.
Shaking up its indebted GE Power unit, the new General Electric CEO Larry Culp has reinstated John Rice – a retired GE veteran who once led its energy unit – as chairman of the Gas Power segment. “GE is desperate for leadership,” analysts commented, but it is deemed unlikely that there will be any quick fix.
More than half of India’s installed 25 GW of gas-fired power generation lies idle, with the Central Electricity Authority (CEA) identifying about 14 GW capacity as ‘stranded,’ of unutilized. These plants had been built based on government assurances of regasified LNG supply, which did not materialize.
Vowing to avoid shortages and price spikes, China’s National Development and Reform Commission (NDRC) is pushing through measures to expand both pipeline gas and LNG imports. Taking early action is meant to improve China’s gas reserve and helps to make pre-arrangements for peak demand. CNNOC just issued a tender for a strip of cargoes to be delivered between November 2018 and 2022.
Swift and efficient completion of drilling at the Wolfcamp play has been driving up the overall hydrocarbon production in the Permian Basin. The Wolfcamp accounted for 1 million barrels of crude oil per day (b/d) and 4 Bcf/d of natural gas. Productivity gains were caused by drilling longer horizontal laterals and optimizing completions.
Soaring costs of LNG imports have increased the importance of a swift restart of Japan’s nuclear reactors to generate comparatively cheap baseload power. Total cost for imported gas topped 418 billion yen ($3.71bn) in October, compared to 280 billion yen ($2.48bn) a year earlier, according to an alert by the Japanese finance ministry.
Despite the drop in rig count, the actual output of crude oil and natural gas keeps rising in the United States thanks to advances in technology and drilling techniques. Even with fewer wells U.S. natural gas gross withdrawals increased from about 78.7 billion cubic feet per day (Bcf/d) to 83.4 Bcf/d.
Hit by a triple-whammy of weak cash flows, meager profits and slumping stock values, CEOs in the oil and gas industry are vary about continuing to invest in increasingly risky fossil fuels. Looking for a quick return, investors want oil majors to prioritize profits over production growth. Some refocus on electricity markets.