Scott Sheffield said the Texas side of the Permian is at about peak production and any growth now will come from New Mexico side. He said US oil production will peak around 13MBPD because there is less quality wells and capital discipline.

I think the interesting thing to follow will be at what price does it take to get to that level. With second tier inventory, you're going to need higher prices

COP Willow Project- Alaska

Will the war on oil and gas continue? COP's Willow development will be the cleanest oil and gas project ever developed. The federal government issued the lease in 1999 and COP has worked diligently to create this world class project. If the feds don't approve the development plans, significant legal activity occurs and this industry continues to decline under FJB.

Maybe they come back with a scaled down development plan in an attempt to discourage COP?

I'm anxiously awaiting the outcome of this decision. It gets developed eventually but does the complete clown show continue?!

LRHF

If PXD bought FANG would they regret selling their Delaware to Continental or would they sell FANGs Delaware position to Continental, or both?

I think FANG is probably a couple years away from either having to decide to sell off their Delaware assets or acquire someone to increase inventory. They don't have much running room left on current acreage and not a ton of potential for bolt on acreage. They've been more focused on Midland Basin side with capital budget and acquisitions recently.

I guess the one interesting part to the equation could be what happens with the Barnett/Woodford plays in the Permian in coming years.

Barnett/Woodford isn't gonna get them where they want to go imo. That's a promoter dreams

txaggie_08 said:

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I think FANG is probably a couple years away from either having to decide to sell off their Delaware assets or acquire someone to increase inventory. They don't have much running room left on current acreage and not a ton of potential for bolt on acreage. They've been more focused on Midland Basin side with capital budget and acquisitions recently.

I guess the one interesting part to the equation could be what happens with the Barnett/Woodford plays in the Permian in coming years.

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Hence why I made the jump from the reservoir engineering side to the trading side of the business. The exploration side is gonna feel really crowded in a few years regardless of oil price when the capital stops flowing due to a lack of development opportunities. Just my opinion. Sure theirs a lot of running room in the lower Wolfcamp for example on the Delaware side, but I have a hard time imagining a scenario where the nat gas infrastructure can keep up with the volume such that it's much more than a marginal play for any extended period of time.

Dan Scott said:

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Scott Sheffield said the Texas side of the Permian is at about peak production and any growth now will come from New Mexico side. He said US oil production will peak around 13MBPD because there is less quality wells and capital discipline.

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Right in line with what Energy Aspects put out a couple of months ago.

LRHF said:

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COP Willow Project- Alaska

Will the war on oil and gas continue? COP's Willow development will be the cleanest oil and gas project ever developed. The federal government issued the lease in 1999 and COP has worked diligently to create this world class project. If the feds don't approve the development plans, significant legal activity occurs and this industry continues to decline under FJB.

Maybe they come back with a scaled down development plan in an attempt to discourage COP?

I'm anxiously awaiting the outcome of this decision. It gets developed eventually but does the complete clown show continue?!

LRHF

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I'm anxiously awaiting this decision because I'm currently working on this project. The original scope included 5 drill sites. Alaska BLM recommended a reduced scope of 3 drill sites as well as reducing some of the surface infrastructure scope, which has been the path forward on this one for a while. COP has said that reducing to two drill sites no longer makes the project economically feasible, which is what I worry Biden will decide to do.

right.at.the.start.of.shoulder.season

cajunaggie08 said:

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Freeport LNG received regulatory approval to return to full production capacity

https://www.houstonpublicmedia.org/articles/news/energy-environment/2023/03/09/445782/freeport-lng-receives-regulatory-approvals-to-return-to-full-production-capacity/?fbclid=IwAR2l7phiKIGxnfhXaznY2MBVUuwNl8N3XKxh5xaMavY16RDjDTqT7XEadWo

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Taken from the article:

"Regulatory agencies decision to approve service was not based just upon Freeport's submitted reports and successfully passing audits, but also included the input from the regulatory agencies own outside consultants. The leading consultant, KHOU's weatherman David Paul, was entrusted to give weekly forecasts before Freeport was allowed to open. Paul, during his final meeting, reviewed the data and said, 'Its gonna be hot as **** for the rest of the year. The only thing to look forward to now is Chita wearing a red dress while hyping up hurricanes.'

The agencies took this response to heart, allowed Freeport to return to service, knowing the cold season was behind them. Regulatory agencies then ended the final approval meeting by heading out to get bottled water, peanut butter, bread, batteries, and bleach for the upcoming impending hurricane season.

Anyone hear who picked up the Carrier Energy II package? Karnes county non-op

Yep

Crude crushed on what seems like a risk off trade after the banks.

Oil below $69….

$68

Relentless selling as funds are getting blown out on their 2 yrs and liquidating and most have gone risk off. If there isnt a bounce, im curious what short cycle shale producers do, $65/$2.5 sure puts a lot of pressure on well performance.

Get ready for a slowdown.

I was talking to a large PE group a few weeks ago and across portcos the drop was considerably larger than I was expecting.

With this leg down and considering timing of wells coming on production. I expect a larger response, given the publics fcf focus and shorter capital runway on privates.

Couple the 65/2.50 with tier 1 inventory being no existent for most……

one MEEN Ag said:

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Just like covid accelerated the demise of zombie OG companies, this banking run is accelerating the return to not-US led oil production, which means higher for longer oil prices.

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Sounds like majors / large companies with cash will be buying something soon if so much of industry is so dependent on financing/debt that banking problems cause oil patch problems

jagvocate said:

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one MEEN Ag said:

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Just like covid accelerated the demise of zombie OG companies, this banking run is accelerating the return to not-US led oil production, which means higher for longer oil prices.

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Sounds like majors / large companies with cash will be buying something soon if so much of industry is so dependent on financing/debt that banking problems cause oil patch problems

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Especially with Biden budget wanting to increase taxes on share buybacks and such. Need another way to spend the cash.

Oil $66

Midland bois need to start stacking. I don't think you guys make that much money at strip on new development.

Probably time to cash out of XOM. Been great for me the past year plus

It's coming.

No doubt. I've seen the economics across multiple producers and price assumptions at current costs basis. I'm not seeing a good enough return at strip on single well economics.

Time to bro down and blow down

Cyp0111 said:

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No doubt. I've seen the economics across multiple producers and price assumptions at current costs basis. I'm not seeing a good enough return at strip on single well economics.

Time to bro down and blow down

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Normalized productivity (mostly liquid side) for the average new shale well is declining somewhere between 5 to 10% YOY in most of the mature shale basins, especially Permian. With capex higher across the board at these strip prices, any new development is taking a hit. I'd preserve my cash and product and wait out this down cycle.

Agreed.