BlackGoldAg2011 said:
Primarily Eagle Ford
As Permian booms, ConocoPhillips focuses on Eagle Ford
https://m.chron.com/business/energy/article/ConocoPhillips-going-slow-in-Permian-focused-on-12918686.php
Houston..we have a problem....
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Last: 1 min ago by CPDAggie10
As Permian booms, ConocoPhillips focuses on Eagle Ford
https://m.chron.com/business/energy/article/ConocoPhillips-going-slow-in-Permian-focused-on-12918686.php
Not who I'm with but the reasoning laid out in that article could have been essentially a transcript from our team meeting last week. I imagine many multi basin players will be doing the same if they have that option.
BlackGoldAg2011 said:
Not who I'm with but the reasoning laid out in that article could have been essentially a transcript from our team meeting last week. I imagine many multi basin players will be doing the same if they have that option.
Completely agree. Eagle Ford crude trading at a $15/bbl premium to the Permian? I'd allocate that direction as well but there are likely a lot of rigs that'll stay out west to retain acreage.
I miss working in the Eagle Ford. I did a lot of work for Conoco down there from 2011-2014.
Gordo14 said:nu awlins ag said:
I'm hearing that the pipelines are running near capacity from a meeting I was in. This could delay a lot of wells being completed since there is no avenue for shipping. I was under the impression that there was plenty of lines in west Texas. It's a double edge sword....
Yes. I've been seeing Midland crude selling at a $11 discount to WTI.
Export capability is one reason but if I remember correctly part of the differential has to do with the API of the "oil". It's not really oil in certain formations since if I remember correctly and has an api of about 51. Run it through a heater treater and I think you can get it below 50 which helps a little with the differential.
I believe the refineries are starting to retool to take the lighter stuff but most on the GCoast are set up to run the heavy stuff, like out of Venezuela.
That's why the keystone pipeline doesn't really affect west Texas because they actually need each other. The lighter stuff cut into the heavier stuff from up north.
It's been a couple years since I looked at it but that's the way I understood it. The west Texas stuff has to be blended into other oil so it can't be compared to straight WTI.
Anyone else get on the LGCY train early? Good grief.
In other news...Summit Petro going to pick up another rig - big move for a group that is largely very conservative. Endeavor going balls to the wall - picking up 2 rigs, keeping 5 frac fleets busy, soon to send out RFP to complete ~45 wells for the 2nd half of the year. SM to drop 1-2 frac fleets. XTO looking to outspend the entire Permian. Apache dropped to 1 frac fleet, expects to complete same # of wells as originally planned. Callon potentially to pick up a fleet. Legacy expected to pick up an additional frac fleet as well. Colgate Energy intends to complete 6 more HZ wells by year end, 12-15 in 2019.
Some of that could be old news, but felt compelled to share.
In other news...Summit Petro going to pick up another rig - big move for a group that is largely very conservative. Endeavor going balls to the wall - picking up 2 rigs, keeping 5 frac fleets busy, soon to send out RFP to complete ~45 wells for the 2nd half of the year. SM to drop 1-2 frac fleets. XTO looking to outspend the entire Permian. Apache dropped to 1 frac fleet, expects to complete same # of wells as originally planned. Callon potentially to pick up a fleet. Legacy expected to pick up an additional frac fleet as well. Colgate Energy intends to complete 6 more HZ wells by year end, 12-15 in 2019.
Some of that could be old news, but felt compelled to share.
Anyone heard any rumbles of Dback eyeballing endeavor? Pure rumor, but caught my ear
jetch17 said:
Anyone heard any rumbles of Dback eyeballing endeavor? Pure rumor, but caught my ear
Haven't heard any specific names, but Endeavor is undoubtedly ramping up with intent to sell or go public. I heard the latter.
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Been hearing rumors of another $5-$10B Permian deal coming soon.
We are 100% Bakken and feeling pretty good right now. With DAPL, the differentials are incredibly competitive nowadays. Doesn't surprise me that the competition in the Permian is driving dollars to other basins, and overall I think it's better for the US oil market. I think cross pollinating the tech in different basins will lead to faster and better innovations than everything being optimized for Permian.
And the summer hasn't even started.
Them along with several other operators. Costs are one factor that a camp told me. Look for the Eagleford to get busy again by mid-summer. Actually it is getting busy but more so by July/August.Boat Shoes said:BlackGoldAg2011 said:
Primarily Eagle Ford
As Permian booms, ConocoPhillips focuses on Eagle Ford
https://m.chron.com/business/energy/article/ConocoPhillips-going-slow-in-Permian-focused-on-12918686.php
Pivot started last month for the larger scale operators. The Eagle Ford and other basins will provide for better returns given constraints in West Texas.
To back that up, they also said that the cut could be as low as 200,000bbls. This news is somewhat old and just today they revised it to 500,000bbls. a day. They have no clue. IEA came out Wednesday and said demand would drop from 1.5 to 1.4bbls. a day because of higher prices. The US isn't even in driving season yet. The IEA only looks at Europe as a gauge for demand while discounting the rest of the world.SpreadsheetAg said:
Brent over $80
https://oilprice.com/
Now...they are saying demand is strong...in ASIA which is why prices are strong. I mean really? Earlier today and yesterday the IEA said the EXACT opposite! Working late...again.
This is true.... but it's why the diff has been -$2 to -$5 historically. Doesn't explain -$13.
aggie028 said:
This is true.... but it's why the diff has been -$2 to -$5 historically. Doesn't explain -$13.
Agreed.
Rex finally filed BK this morning.
Can anyone explain to me the relationship between Brent Crude and WTI Crude? I realize these are different types of commodities traded seperately...
But why is there a $8 gap? Is one product superior? Also, does one going up (like Brent) drag the other up lagging behind it?
But why is there a $8 gap? Is one product superior? Also, does one going up (like Brent) drag the other up lagging behind it?
Here you go......Before 2011, Brent and WTI crude oil prices tracked closely, with Brent crude oil prices typically trading at a slight discount to WTI crude oil, reflecting delivery costs to transport Brent crude oil and Brent-like crude oil into the U.S. market, where they competed with WTI crude oil. In early 2011, this longstanding relationship began to change, and since then, WTI crude oil has priced at a persistent discount to Brent crude oil. Increased U.S. light sweet crude oil production combined with limited pipeline capacity to move the crude from production fields and storage locations, including Cushing, Oklahoma, the delivery point for the Nymex light sweet crude oil contract, to refining centers put downward pressure on the price of WTI crude oil.SpreadsheetAg said:
Can anyone explain to me the relationship between Brent Crude and WTI Crude? I realize these are different types of commodities traded seperately...
But why is there a $8 gap? Is one product superior? Also, does one going up (like Brent) drag the other up lagging behind it?
More recently, expansions in U.S. crude oil infrastructure have eased the downward pressure on the price of WTI. Since mid-2012, significant pipeline takeaway capacity has been added at Cushing, enabling crude oil to flow to and from the trading hub more easily. Other pipeline and rail projects have also been completed, making it possible to move barrels from production areas, such as Texas and North Dakota, to refinery centers without passing through the hub. Even U.S. East Coast refineries, which historically have relied on Brent crude oil and Brent-like crudes, can now access U.S. light sweet crude oil. U.S. crude that moves by rail is replacing Brent crude oil and Brent-like crude oil imports into the U.S. East Coast, putting downward pressure on the price of Brent crude oil and narrowing the differential versus WTI crude oil.
The future of the Brent-WTI price spread will be determined, in part, by the balance between future growth in U.S. crude production and the capacity of crude oil infrastructure to move that crude to U.S. refiners. The International Energy Agency (IEA) reported that planned maintenance in the North Sea oil fields this summer will reduce production, adding upward pressure to Brent prices and potentially widening the Brent-WTI spread. In its June 2013 Short-Term Energy Outlook, EIA forecast the Brent-WTI price spread to average $11/bbl in 2013 and decline to an average $8/bbl in 2014. For more information about the Brent-WTI spread, see the June 5, 2013, edition of This Week in Petroleum.
Amazingly, I understood all of thatnu awlins ag said:Here you go......Before 2011, Brent and WTI crude oil prices tracked closely, with Brent crude oil prices typically trading at a slight discount to WTI crude oil, reflecting delivery costs to transport Brent crude oil and Brent-like crude oil into the U.S. market, where they competed with WTI crude oil. In early 2011, this longstanding relationship began to change, and since then, WTI crude oil has priced at a persistent discount to Brent crude oil. Increased U.S. light sweet crude oil production combined with limited pipeline capacity to move the crude from production fields and storage locations, including Cushing, Oklahoma, the delivery point for the Nymex light sweet crude oil contract, to refining centers put downward pressure on the price of WTI crude oil.SpreadsheetAg said:
Can anyone explain to me the relationship between Brent Crude and WTI Crude? I realize these are different types of commodities traded seperately...
But why is there a $8 gap? Is one product superior? Also, does one going up (like Brent) drag the other up lagging behind it?
More recently, expansions in U.S. crude oil infrastructure have eased the downward pressure on the price of WTI. Since mid-2012, significant pipeline takeaway capacity has been added at Cushing, enabling crude oil to flow to and from the trading hub more easily. Other pipeline and rail projects have also been completed, making it possible to move barrels from production areas, such as Texas and North Dakota, to refinery centers without passing through the hub. Even U.S. East Coast refineries, which historically have relied on Brent crude oil and Brent-like crudes, can now access U.S. light sweet crude oil. U.S. crude that moves by rail is replacing Brent crude oil and Brent-like crude oil imports into the U.S. East Coast, putting downward pressure on the price of Brent crude oil and narrowing the differential versus WTI crude oil.
The future of the Brent-WTI price spread will be determined, in part, by the balance between future growth in U.S. crude production and the capacity of crude oil infrastructure to move that crude to U.S. refiners. The International Energy Agency (IEA) reported that planned maintenance in the North Sea oil fields this summer will reduce production, adding upward pressure to Brent prices and potentially widening the Brent-WTI spread. In its June 2013 Short-Term Energy Outlook, EIA forecast the Brent-WTI price spread to average $11/bbl in 2013 and decline to an average $8/bbl in 2014. For more information about the Brent-WTI spread, see the June 5, 2013, edition of This Week in Petroleum.
Nice....now go have a beer!
Gig-Em2003 said:
Been hearing rumors of another $5-$10B Permian deal coming soon.
Secret secrets are no fun...
That really is an amazingly outdated EIA Short Term outlook.
It was to discuss how the spread works. He wanted to know...
nu awlins ag said:
It was to discuss how the spread works. He wanted to know...
No worries, just wanted to point that out so someone doesn't do anything rash, like sell off their house....or buy a bass boat.
It is getting close to bass boat buying time, you know?
Sure is
Where and in what capacity were you working for ConocoPhillips? My family has land under lease with them in the Eagle Ford. Those early days with oil over $100 were really nice. I'd love to see some of those prices again, admittedly for selfish reasons. Conoco has been, in general, a good company to be leased with.DDSO said:
I miss working in the Eagle Ford. I did a lot of work for Conoco down there from 2011-2014.
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I was just a contract Landman. I worked in Karnes, DeWitt and Gonzales Counties.
I really enjoyed that part of the state. It was a good place to learn the business.
I really enjoyed that part of the state. It was a good place to learn the business.
Goose06 said:
Speaking of Devon, rumors are out there that they are selling their Reeves/ward county acreage. It's not a huge position, but I'm curious who might be buying that. Anyone hear any rumors on the buyer?
Just heard Manti was the buyer
Possible but seems unlikely given the size and that Jefferies is marketing it and hasn't started the data room presentations yet.
aggie028 said:
Possible but seems unlikely given the size and that Jefferies is marketing it and hasn't started the data room presentations yet.
I heard it from 2 sources. Neither is rock solid on their own, but would be odd to get the same info from 2 sources and have it be wrong. I'll try to corroborate it tomorrow at DUG.
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