May 2017 UPDATE

UPCOMING EVENTS

"Increasing Oil Company Capex for Offshore"
Jon Fredrik Müller, Partner
June 1, 2017
Oslo, Norway

Rystad Energy Information Session
June 14, 2017
Paris, France

 


WEBINAR RECORDINGS

NASReport - Content Webinar

Speaker: Sona Mlada, Senior Analyst 

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NCS Update - Content Webinar

Speaker: Simon Sjøthun, Project Manager 

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Middle East Update - Content Webinar

Speaker: Veronika Akulinitsiva, Analyst

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INDUSTRY VIEW

"The call on Shaleby Leslie Wei, Analyst
(Published by Oil & Gas Financial Journal, May Edition)
The shale revolution was one of contributing factors to the oil price collapse in 2014. During the period 2013-2015, the North American shale production grew by ~1.5 million bbl/d per year. These volumes along with the results from the 2010-2014 investment cycle caused global supply to grow faster than demand in both 2014 and 2015. Going forward, shale is speculated to be the limiting force in the growth of the oil price as it responds quickly to higher prices. However, by studying the sources of new production in the medium term, it is clear that shale is the only source of production that can add the necessary volumes for supply to keep up with demand.

"Trump's trade deal with China would allow 105 BCF/D  gas production at 3USD/MMBTU"
With abundant supply potential, Rystad Energy expects US gas companies to see a large LNG export potential to China after President Donald Trump and President Xi Jinping reached the bilateral trade agreement last month. Sinopec’s invitation to welcome Cheniere to their offices in China last week, clearly underpins Chinese energy companies’ mutual interest.

"Strong Q1 positions shale for steady growth in 2017"
Amid persistent recovery in US horizontal onshore rig counts since bottoming out in mid-2016, it is only in Q1 2017 that shale started to exhibit material and persistent monthly output additions. This is evident on the oil side, according to official state data that already provides sufficient fact-based visibility on the most recent trends in Q1 2017. With a strong start to 2017, shale is set for steady growth throughout the remainder of 2017, due to indications of significant recovery in completion activity.

"North Sea and GOM: New projects will contribute to growthby Espen Erlingsen, VP Analysis, & Audun Martinsen, VP Oilfield Service Research
(Published by E&P Magazine, May Edition)
The Gulf of Mexico (GoM) and the North Sea are two of the key global offshore regions. Together these two regions account for about 20% of the global offshore production and represent 25% of global offshore investments. This article will take a closer look at how these regions will develop going forward.

"The Jackup market: activity picking up, rates remain depressed"
After historical highs in 2014, jackup demand plunged by 25% from 409 units in 2014, to 308 units in 2016. With 72 newbuilds scheduled to come into the market in the next few years and only 63 units retired since 2014, the jackup market is in the midst of an oversupply situation, resulting in low utilization levels and depressed rates. Rystad Energy forecasts a small increase in jackup demand this year, compared to 2016 levels. In line with this view, we have seen increased tendering activity during the first quarter of 2017.

"US oil production has gained significant momentum - limited downside risk in the short-term
Looking at the recent evolution of oil production in the Lower 48 states (excl. Gulf of Mexico), Rystad Energy observes a continuous expansion, with a 430 MBbld growth from December 2016 to May 2017. Even though late-2016 production levels were adversely exposed to winter storms in several states, the growth from the average level in 4Q 2016 to May 2017 is still significant, around 340 MBbld. 

"Shifting flows of Natural gas in South Americaby Kjetil Solbraekke, Head of Rio Office
The gas market in South America is somewhat different from the other markets around the world. To a certain degree it is a developed market with cross-country import and export, but it is segmented, relatively small, dominated by NOCs and without very transparent regulations in each country. The region is currently a net importer of gas in the form of relatively expensive LNG. 

"Japan's Energy Sector: LNG's future in a nuclear restart" by Sindre Knutsson & May Phan, Analysts
(Published by LNG Industry, March Edition)
Following the global recession in 2008-2009 and the 2011 Tōhoku earthquake and tsunami, the Fukushima accident cast a long shadow over the Japanese energy sector. Japan’s sudden need for alternative sources of energy following the nuclear shutdown forced a shift in energy imports.  LNG imports surged to replace the loss of nuclear power generation.

 

RYSTAD ENERGY'S NEW ECONOMIC MODELLING TOOL

Early in May, Rystad Energy extended functionality of its proprietary upstream database, UCube, with the new powerful valuation tool - UCube Economic Model (UCube EM). UCube EM is a fully customizable, transparent, excel-based model for evaluating upstream oil & gas assets, companies and portfolios across the world.

UCube EM leverages all data available in UCube and allows for more in-depth analysis and customization, including adjustment of any asset parameters, commodity price scenarios and macro assumptions.