.
And now the shoe drop ........projects are put on ice
http://uk.reuters.com/article/2014/12/0 ... D220141205
PeakOil is You
Why Oil Is Finally Declining, Which May Lead to Disaster
Re: Why Oil Is Finally Declining, Which May Lead to Disaster
by sparky » Sat 06 Dec 2014, 04:24:58
-
sparky - Intermediate Crude
- Posts: 3587
- Joined: Mon 09 Apr 2007, 03:00:00
- Location: Sydney , OZ
Re: Why Oil Is Finally Declining, Which May Lead to Disaster
by Tanada » Sat 06 Dec 2014, 08:51:48
$this->bbcode_second_pass_quote('sparky', '.')
And now the shoe drop ........projects are put on ice
http://uk.reuters.com/article/2014/12/0 ... D220141205
And now the shoe drop ........projects are put on ice
http://uk.reuters.com/article/2014/12/0 ... D220141205
The most relevant part from your link,
$this->bbcode_second_pass_quote('', 'L')EAST LIKELY
Projects in Canada's oil sands, which require expensive and complex extraction techniques, are the most unlikely to go ahead given their high investment requirements and relatively slow returns. Total (TOTF.PA) recently decided to postpone the FID on the Joslyn project in Alberta, the cost of which Hodée estimated at $11 billion.
Shell's liquefied natural gas (LNG) project in Canada's British Columbia, already under pressure from a looming supply surge, faces further strain in the current price environment, analysts said. According to research by Citi, the project requires oil at $80 a barrel to break even.
Royal Dutch Shell's (RDSa.L) chief financial officer Henry Simon indicated in October that it was "less likely" to go ahead with unconventional projects in West Canada if oil falls below $80 a barrel.
Asked by Reuters what the company's current thinking was, a Shell spokesman would not comment on "internal decision-making."
Even in the Gulf of Mexico, one of the most attractive oil production areas in the world, projects are facing challenges.
BP (BP.L) last year put on hold a decision on its Mad Dog Phase 2 deep water project in the Gulf of Mexico after its development costs ballooned to $20 billion and the oil major is now expected to further delay an investment on the field's development.
"BP were talking positively about bringing it back, but now it may be put on hold," BMO Capital Markets analyst Iain Reid said.
BP's chief financial officer Brian Gilvary however said in an analysts briefing in October that he expected Mad Dog Phase 2 to be sanctioned in the first quarter of 2015.
Statoil's Johan Castberg field in the Barents Sea, which was expected to get its FID in 2015, seems unlikely to get the go-ahead at the moment given it has an estimated project cost of $16-$19 billion, Hodée said.
Statoil said that the final project design is due in the summer of 2015. Its giant Johan Sverdrup field in the North Sea is still on track for development with a price tag of $32.5 billion.
(Additional reporting by Oleg Vukmanovic in Milan and Balazs Koranyi in Oslo; Editing by Sophie Walker)
I think the fundamentals remain the same as always, if the field in question will produce a steady return for a long time it is far more likely to proceed at some point. If the project is small potato's then it will get developed when prices are high enough to justify the infrastructure needed to develop it.
$this->bbcode_second_pass_quote('Alfred Tennyson', 'W')e are not now that strength which in old days
Moved earth and heaven, that which we are, we are;
One equal temper of heroic hearts,
Made weak by time and fate, but strong in will
To strive, to seek, to find, and not to yield.
Moved earth and heaven, that which we are, we are;
One equal temper of heroic hearts,
Made weak by time and fate, but strong in will
To strive, to seek, to find, and not to yield.
- Tanada
- Site Admin
- Posts: 17094
- Joined: Thu 28 Apr 2005, 03:00:00
- Location: South West shore Lake Erie, OH, USA
Re: Why Oil Is Finally Declining, Which May Lead to Disaster
by ROCKMAN » Sat 06 Dec 2014, 11:36:26
T - "I think the fundamentals remain the same as always". Yep... same ole same ole. Some folks seem to think they discovered some great secret the oil patch has been hiding. The "secret": only projects that can be economically developed are pursued. But it follows the silly position held by some that the increase in oil prices wasn't the primary driver behind the surge in the US oil production surge.
-
ROCKMAN - Expert
- Posts: 11397
- Joined: Tue 27 May 2008, 03:00:00
- Location: TEXAS
Re: Why Oil Is Finally Declining, Which May Lead to Disaster
by TheDude » Sat 06 Dec 2014, 12:04:35
$this->bbcode_second_pass_quote('GoghGoner', 'W')hen the EIA puts out US gasoline demand stats, it usually uses US Product Supplied as a proxy not Refiner sales volume. I believe that US gasoline sales were down just under 9% between 2005 and 2013 and it can be explained by a drop in VMT.
US VMT indeed has plateaued:
So refiners have turned to customers overseas, no surprise there. This has been going on for a decade now.
Sustained high prices I check up to Libya going offline, sanctions against Iran, and attendant general tight supplies. China has "weak growth" and they still build their demand year after year, same goes for the rest of the BRIC, the developing world in general, and let's not forget ever-increasing domestic demand in exporting nations themselves, whose citizenry would absolutely freak over having to pay 25 cents a gallon.
Cogito, ergo non satis bibivi
And let me tell you something: I dig your work.
And let me tell you something: I dig your work.
-
TheDude - Expert
- Posts: 4896
- Joined: Thu 06 Apr 2006, 03:00:00
- Location: 3 miles NW of Champoeg, Republic of Cascadia
