Oil & Natural Gas: News & Discussion

VinodTK · Post by **VinodTK** » 01 Jan 2018 20:07

ONGC makes significant oil, gas discovery in Arabian Sea

NEW DELHI: State-owned Oil and Natural Gas Corp (ONGC) has made a significant oil and gas discovery to the west of its prime Mumbai High fields in the Arabian Sea, oil minister Dharmendra Pradhan said on Monday.

In a written reply to a question in the Lok Sabha, he said the discovery was made in the well WO-24-3 (WO-24-C) drilled west of Mumbai High fields.Though a holiday was declared for Parliament, replies to questions were posted on the Lok Sabha website.
"Based on the data generated during drilling, 9 objects/zones were identified and on testing all the objects flowed oil/gas," he said.

The discovery has indicated potential in-place reserves of about 29.74 million tonnes of oil and oil equivalent gas, he said.

"The 9th object on testing flowed oil at the rate of 3,310 barrels per day and gas at the rate of 17,071 cubic meter per day," the minister said. "This multi-layered oil and gas accumulation in this well opened up new area for exploration/development."

Mumbai High, India's biggest oil field, currently produces 205,000 barrels of oil per day (just over 10 million tonnes per annum) and the new find would add to that production in less than two years' time.

ONGC is carrying out a further appraisal of the discovery and has intimated upstream regulator the Directorate General of Hydrocarbons (DGH).

The new find, which comes almost 50 years after ONGC began production in Mumbai High, will help the company maintain production levels from the basin for a longer time than currently estimated.

Mumbai High is ONGC's flagship oil producing assets. It along with other small fields along the western offshore produce 16 million tonnes per annum of oil, which is 44 per cent of Indias total crude oil production of 36 million tonnes.

ONGC produced 25.5 million tonnes of oil in 2016-17, which will reach 28-29 million tonnes by 2019-20, officials said.

chetak · Post by **chetak** » 01 Jan 2018 20:14

Is this going to rake up the sir creek issue once again with our ever greedy neighbor salivating over redrawing the line??

Mort Walker · Post by **Mort Walker** » 02 Jan 2018 22:54

VinodTK wrote:ONGC makes significant oil, gas discovery in Arabian Sea
NEW DELHI: State-owned Oil and Natural Gas Corp (ONGC) has made a significant oil and gas discovery to the west of its prime Mumbai High fields in the Arabian Sea, oil minister Dharmendra Pradhan said on Monday.

In a written reply to a question in the Lok Sabha, he said the discovery was made in the well WO-24-3 (WO-24-C) drilled west of Mumbai High fields.Though a holiday was declared for Parliament, replies to questions were posted on the Lok Sabha website.
"Based on the data generated during drilling, 9 objects/zones were identified and on testing all the objects flowed oil/gas," he said.

The discovery has indicated potential in-place reserves of about 29.74 million tonnes of oil and oil equivalent gas, he said.

"The 9th object on testing flowed oil at the rate of 3,310 barrels per day and gas at the rate of 17,071 cubic meter per day," the minister said. "This multi-layered oil and gas accumulation in this well opened up new area for exploration/development."

Mumbai High, India's biggest oil field, currently produces 205,000 barrels of oil per day (just over 10 million tonnes per annum) and the new find would add to that production in less than two years' time.

ONGC is carrying out a further appraisal of the discovery and has intimated upstream regulator the Directorate General of Hydrocarbons (DGH).

The new find, which comes almost 50 years after ONGC began production in Mumbai High, will help the company maintain production levels from the basin for a longer time than currently estimated.

Mumbai High is ONGC's flagship oil producing assets. It along with other small fields along the western offshore produce 16 million tonnes per annum of oil, which is 44 per cent of Indias total crude oil production of 36 million tonnes.

ONGC produced 25.5 million tonnes of oil in 2016-17, which will reach 28-29 million tonnes by 2019-20, officials said.

Doesn’t seem like a lot. Around 30 million tones or 210 million barrels. India uses some 5 million barrels a day.

Austin · Post by **Austin** » 13 Jan 2018 17:32

The World’s Most Expensive Oil

Prem · Post by **Prem** » 18 Jan 2018 02:05

https://sputniknews.com/analysis/201712 ... -oi-field/

New Delhi (Sputnik) — The Indian consortium led by ONGC was among the two global entities that took part in the auction of Israel's offshore gas fields held last month after a gap of more than 4 years during which the sea was completely closed for the distribution of new exploration licenses.
The consortium comprising ONGC Videsh Ltd, Bharat PetroResources Ltd, Indian Oil Corporation Ltd and Oil India Ltd is also set to be registered as a foreign company in Israel's Corporations' Authority in January 2018. This would facilitate its participation in the second round of bidding.
The Israeli blocks are in close proximity to a number of large and proven gas deposits in the eastern Mediterranean. Some are adjacent to the recently discovered Leviathan and Tamar fields. According to an industry estimate, nearly 2,200 billion cubic meters of natural gas and a potential 6.6 billion barrels of oil are to be discovered in these blocks.India's decision to enter Israeli waters for energy exploration has a greater strategic significance than securing energy at another location, especially after waiting for several years to win exploration rights for Iran's Farsi and Farzad B gas fields."India wants to send two signals from this decision. First, if Iran continues to dillydally on the proposal of awarding gas fields to India, New Delhi can open new vistas for exploration in the region; secondly, to Israel that New Delhi really wants to deepen its relationship with the Jewish nation," SC Tripathi, former secretary in India's Ministry of Petroleum & Natural Gas told Sputnik."Entry into Israeli water for gas exploration could upset some Arabian nations. But, of late, it is being seen that countries like Jordon have started co-operating with Israel while Saudi Arabia is no more fervently opposing Israel. Iran is the only country in the region which could pose strong opposition to the Indian move," SC Tripathi, added."Iran is very difficult county to do business due to multiple layers of negotiations. India had faced several years of delay in the Farsi block and the same outcome has been witnessed in the Farzad B gas block. Indian companies discovered both the fields but Iran delayed the decision in awarding development rights. The similar situation has emerged in the Iran-India pipeline project. This is the major reason for India to move towards Israel," Tripathi added.Nevertheless, some experts also believe that the decision to explore Israeli gas field should not be linked with Iran's reluctance to allocate the Farzad B gas field to India."Any possible investment in Israel's gas potential would be independent of India's deep oil and gas ties with Iran and the Arab world, including Qatar, Iraq, Oman and Saudi Arabia. India's ONGC Videsh discovered the Farzad B and New Delhi is very hopeful that OVL will be allowed to develop the field's full potential. India and Iran are two close and strategic partners in oil and gas," Narendra Taneja, India's leading energy expert told Sputnik.00Also, from a larger perspective, the main question that lingers is what would India gain from the deal with Israel? "I don't see a large quantity of gas on the coast of Israel and it would be very difficult for India to bring gas from these coasts. Either, India will have to sell the gas to Egypt, which already discovered a huge quantity of gas, or bring the LNG through Suez Canal," SC Tripathi concludes.Experts also believe that if the Narendra Modi government is using this situation as a comeback to Iran for not protecting its economic interests, then it must take into account the larger strategic interests in Afghanistan, Russia, and the CIS countries as the Chabahar port in Iran is the only access point it has to reach out to these countries bypassing arch-rival Pakistan.

Austin · Post by **Austin** » 29 Jan 2018 18:23

Saudi Oil Minister Tired Of Shale Hype

chanakyaa · Post by **chanakyaa** » 11 Feb 2018 03:06

India Wins Piece of Abu Dhabi Oil With Stake in $6 Billion Field

India secured a share in Abu Dhabi’s oil production for the first time after agreeing to pay $600 million for a tenth of one of the emirate’s biggest offshore deposits...

arun · Post by **arun** » 11 Feb 2018 09:34

Austin wrote:Russia’s Gazprom To Help Build Iran-India Gas Pipeline

https://oilprice.com/Latest-Energy-News ... eline.html

Cut from November 2017 to February 2018 and it appears that Gazprom was being unrealistically hopeful.

The Iran – Pakistan – India (IPI) pipeline is going nowhere

. “Brotherly” Ummah member and fellow Islamic Republic, Iran, is threatening to take the Mohammadden Terrorism Fomenting Islamic Republic of Pakistan to Court over the lack of progress on pipeline construction:

Iran oil ministry to start legal action against Pakistan

Vips · Post by **Vips** » 09 Mar 2018 04:32

Nearly 80% of Indian households now have access to LPG gas.

Nearly 80 per cent of Indian households now have access to clean cooking gas, a big jump from 56 per cent three years ago, as state-run oil firms are enrolling new customers at a record pace to meet the target set by the Modi government.

These firms added as many as seven crore LPG customers between April 2015 and December 2017, expanding the active customer base by about 50 per cent, an unheard-of rate in the past.

The key driver of such expansion has been the government determination determination to wean all homes off hazardous traditional cooking fuel such as firewood and coal.

Prodded by petroleum and natural gas minister Dharmendra Pradhan, staterun oil firms have worked on a war footing to induce demand for fresh connections through a mix of actively reaching out to potential customers, simplifying subscription process and using official subsidy scheme to tap poor households.

The government had set a target for oil firms to enrol three crore new customers in 2016-17, another three crore in 2017-18 and four crore in 2018-19. Companies are close to achieving the targets for the first two years. About 2.27 crore new customers were added between April and December 2017, with backward states of West Bengal (29 lakh), Bihar (26.36 lakh) and Uttar Pradesh (26.32 lakh) receiving maximum fresh connections.

At the beginning of 2018, the cooking gas coverage reached 79.2 per cent of the country’s households, with states in the south (94 per cent) and north (89 per cent) faring better than the national average while those in the west (73 per cent), east (62 per cent) and northeast (57 per cent) averaging lower.

Goa (137 per cent), Delhi (126 per cent) and Punjab (123 per cent) are the top three states in terms of cooking gas coverage – the numbers being above 100 as they are based on the 2011 census data, since when the population has risen in these places as well as the rest of the country.

Jharkhand (44 per cent), Odisha (51.5 per cent), Bihar (56 per cent) and Chhattisgarh (57 per cent) figure among states with the lowest coverage. With massive addition of customers in recent years, cooking gas penetration in West Bengal and Uttar Pradesh has risen to 78.5 per cent.

One reason southern states have fared better is due to years of incentives by state governments of Andhra Pradesh, Telangana and Tamil Nadu to poor households for cooking gas subscription. A few other states ..

About 1.17 crore poor households have benefited from such subsidy schemes in different states. About 70 lakh connections to poor families have also been released in the past with support from the corporate social responsibility fund of state-run oil companies.

Under the central government’s Ujjwala scheme, launched in May 2016, 3.2 crore fresh connections have been issued to poor families till December 2017.

Peregrine · Post by **Peregrine** » 09 Mar 2018 22:10

X Posted on the Terroristan Thread

A $7.5 billion pipeline has surprise patrons: Taliban militants

KABUL: After decades of talks, Afghanistan finally broke ground last month on a $7.5 billion gas pipeline that will run through areas controlled by the Taliban. Even more surprising: The militant group is backing the project.

The Taliban "deems it its responsibility to revive foundational economic and reconstruction work in the country and asks international construction companies to help the Afghans in this regard," Zabihullah Mujahed, a spokesman, said in a statement last month, noting that talks on the pipeline dated back to when the Taliban governed the nation.

The endorsement from a group that has fought the US-backed government in Kabul for the past 17 years raises a slight hope for a political settlement even as violence continues to rage. President Ashraf Ghani last week presented his most comprehensive peace offering yet to the Taliban, which controls or contests nearly half the country. He's open to recognizing the group as a political movement and would help remove international sanctions.

"After the project's completion, it will have some sort of positive impact on peace talks between the Taliban and the government," said Harun Mir, a political analyst in Kabul. "The Taliban who live there can benefit too and that may open the gate for talks."

The Turkmenistan-Afghanistan-Pakistan-India pipeline will eventually carry an annual 33 billion cubic meters of gas, creating thousands of jobs and generating more than $400 million in annual revenue for the cash-strapped government in Kabul. State-owned Turkmengaz, Afghan Gas Enterprise and GAIL India Ltd are among companies working on the project.

The Afghan section of the pipeline -- about 500 miles passing through some Taliban-controlled areas -- is scheduled to be finished in two years. It will then reach Pakistan before crossing its heavily fortified border with India.

Ensuring security will be crucial as its runs along a highway in southern Afghanistan that has been beset by frequent attacks. Its success also hinges on regional cooperation among countries that have less than rosy relations.

"We will have no any enmity relations with any country in the future," Ghani told a hundreds-strong audience in Herat at a ceremony attended by Turkmenistan President Gurbanguly Berdymukhamedov, Pakistan's Prime Minister Shahid Khaqan Abbasi and MJ Akbar, India's junior external affairs minister. "We just want to secure our national interest."

Ghani didn't detail security arrangements and only briefly suggested that local authorities would be responsible for the pipeline's safety.

Cash incentives

Ghani's government has expressed skepticism of the Taliban's intentions. The administration won't make payments to the Taliban and it's "premature" to trust their assurances, according to Dawa Khan Menapal, a presidential spokesman.

"Families, friends and relatives of Taliban can use it as well -- so it's their responsibility to protect and defend any national projects," Menapal said.

Ghani has a lot riding on the project's success. His administration has struggled to implement any meaningful economic gains in the midst of worsening violence across the country.

John R Bass, the US ambassador to Afghanistan, tweeted last month that the project will "energize regional cooperation" and "become an important source of revenue."

That optimism is being pared with realities on the ground. The conflict killed or wounded more than 10,000 civilians last year, according to the United Nations. In January, the Taliban claimed attacks in the capital that killed and wounded hundreds. Islamic State has also slowly extended its reach in Afghanistan.

Mutual allegations

"Even if the Taliban has said they won't cause problems, there are many other militant groups that could," said Michael Kugelman, a senior associate for South Asia at the Woodrow Wilson Center in Washington. Also "the Taliban could well change its mind."

Relations between Pakistan and Afghanistan are also at a nadir amid mutual allegations that both nations support terror groups striking each other. It's also questionable whether India will rely on a pipeline that passes through its northern arch-rival.

"The present circumstances of heightened India-Pakistan tension and worsening conditions in Afghanistan make the project even less viable than it was a few years ago," said Shashank Joshi, a senior research fellow at the Royal United Services Institute in London.

My Comments : The above Natural Gas Pipe line WILL GET DISRUPTED IF NOT IN AFGHANISTAN THEN IN TERRORISTAN. Here is an old article Explaining the Whole SCENARIO :

The Pipelines Perplexity – Bhaskar Dasgupta : Jan 16, 2004

Cheers

Prem · Post by **Prem** » 15 Mar 2018 00:43

https://www.news18.com/news/business/ve ... 87067.html
Venezuela Wants India to Buy Its Oil Using Rupee, Not US Dollarl

New Delhi: Venezuela wants to trade with India using Indian rupee, its Foreign Minister Jorge Arreaza said on Monday.Arreaza said Venezuela wants India to buy its oil using Indian rupee, which the South American country in turn can use for trading Indian food products and medicines.The arrangement to trade in Indian rupee currently exists between Iran and Bhutan and Venezuela wants a similar arrangement with India."We don't want to use dollar at all," Arreaza told reporters.Arreaza said his country has a similar arrangement with Turkey, China and Russia. He said a proposal in this regard was discussed with the finance and the petroleum ministries of India."We want to import technology, food products and medicines by paying (Indian) rupees and they will pay us (Venezuela) not in (US) dollars but in rupees," he said.The reason cited behind the move was the sanctions imposed by the US.Nearly 44 Venezuelans have now been sanctioned by the United States government, including President Nicolas Maduro himself, whom the Trump administration has branded a "dictator".Currently, the trade between India and Venezuela takes place using dollar.India through its oil Public Sector Undertaking has invested substantially in the oil sector of that country. The South American country is the second largest oil supplier to India.The Venezuelan foreign minister, who was here to attend the Founding Conference of the International Solar Alliance, said President Maduro wanted to attend the event but he had to drop the plan due to the polls back home.Maduro is seeking a re-election."After President Maduro hopefully gets re-elected, he will visit India and also extend an invitation to Prime Minister Narendra Modi to visit Caracas," he said.The foreign minister said during his visit he met his Indian counterpart Sushma Swaraj and discussed ways to enhance cooperation.

Varoon Shekhar · Post by **Varoon Shekhar** » 15 Mar 2018 01:55

How long will India's indigenous oil reserves last at current rates of production?

Austin · Post by **Austin** » 29 Mar 2018 17:30

Saudis, Russians Set To Tag-Team Oil Markets To Fend Off American Shale

Fresh off a visit to Washington, the Crown Prince of Saudi Arabia is turning to Russia to help the OPEC leader remain a force in world oil markets that have been rattled by the development of U.S. shale. In an exclusive that quietly ran on the Reuters newswire Tuesday, Saudi Crown Prince Mohammed bin Salman (MBS) said he wants long-term cooperation with Russia to stabilize oil prices.

"We are working on moving from a model agreement for a year to a longer term — 10-20 years," MBS said in an interview with Reuters in New York. "Such an agreement exists, but the details have not yet been worked out." Last week, Saudi Energy Minister Khalid al-Falih said he expected to extend the pact for 2019. The story broke this week but was already in the works prior to MBS' trip to the U.S.

vasu raya · Post by **vasu raya** » 31 Mar 2018 21:17

http://www.dailypioneer.com/top-stories ... orrow.html

According to IOC, for petrol engines, one of the most critical specifications is Research Octane No. (RON), which has improved from 88 in BS-II to 91. It is at par with regular 91 octane gasoline (petrol) required for Euro VI emission norms.

Sulphur specification for petrol and diesel will be reduced 50 times from a level of 500 ppm for BS-II fuel to 10 ppm in BS-VI.

Previously, the fuels meeting Euro-IV or Bharat Stage (BS)-IV specifications were to be supplied throughout the country by April 2017 and BS-V or Euro-V grade fuel by April 1, 2020. But now the government plans to switch over directly from BS-IV to BS-VI auto fuels.

Oil refineries had previously upgraded technology and invested over Rs 55,000 crore for production and supply of BS-III/IV fuels. Oil refineries will need to invest Rs 28,000 crore in upgrading petrol and diesel quality to meet cleaner fuel specifications by 2020.

Vips · Post by **Vips** » 31 Mar 2018 21:47

Austin wrote:Saudis, Russians Set To Tag-Team Oil Markets To Fend Off American Shale

Fresh off a visit to Washington, the Crown Prince of Saudi Arabia is turning to Russia to help the OPEC leader remain a force in world oil markets that have been rattled by the development of U.S. shale. In an exclusive that quietly ran on the Reuters newswire Tuesday, Saudi Crown Prince Mohammed bin Salman (MBS) said he wants long-term cooperation with Russia to stabilize oil prices.

"We are working on moving from a model agreement for a year to a longer term — 10-20 years," MBS said in an interview with Reuters in New York. "Such an agreement exists, but the details have not yet been worked out." Last week, Saudi Energy Minister Khalid al-Falih said he expected to extend the pact for 2019. The story broke this week but was already in the works prior to MBS' trip to the U.S.

Western Europe, India and South America can offset this by importing more from USA (India has already started this) and encouraging an ever increasing production of Shale oil in America.

chetak · Post by **chetak** » 01 Apr 2018 13:28

Austin wrote:Saudis, Russians Set To Tag-Team Oil Markets To Fend Off American Shale

Fresh off a visit to Washington, the Crown Prince of Saudi Arabia is turning to Russia to help the OPEC leader remain a force in world oil markets that have been rattled by the development of U.S. shale. In an exclusive that quietly ran on the Reuters newswire Tuesday, Saudi Crown Prince Mohammed bin Salman (MBS) said he wants long-term cooperation with Russia to stabilize oil prices.

"We are working on moving from a model agreement for a year to a longer term — 10-20 years," MBS said in an interview with Reuters in New York. "Such an agreement exists, but the details have not yet been worked out." Last week, Saudi Energy Minister Khalid al-Falih said he expected to extend the pact for 2019. The story broke this week but was already in the works prior to MBS' trip to the U.S.

a very "pious" and hypocritical ask by Mohammed bin Salman.

He has formed a jehadi NATO, headed by a paki general, no less, against syria and iran, both countries supported by the russkis.

So the russkis, for sure, already have a rather big dog in this fight.

for a start, they need the saudi NATO back the hell off, and by doing that the saudis will piss off the amrekis who want to sell shale oil to undercut the saudis.

Can things get anymore complicated and self serving??

India is already getting a lot of oil from venezuela now and maybe in rupee payments too, per press reports.

kit · Post by **kit** » 01 Apr 2018 13:56

If India makes rupee payments for "all" it's oil imports will it help the economy?

nandakumar · Post by **nandakumar** » 01 Apr 2018 17:44

kit wrote:If India makes rupee payments for "all" it's oil imports will it help the economy?

There was a news about Venezeula wanting to do so. See this link.
https://timesofindia.indiatimes.com/bus ... 274560.cms
A rupee trade basically means oil exporter country wants to import goods of equivalent value from India. Therein lies the challenge.

chetak · Post by **chetak** » 01 Apr 2018 17:50

nandakumar wrote:
kit wrote:If India makes rupee payments for "all" it's oil imports will it help the economy?
There was a news about Venezeula wanting to do so. See this link.
https://timesofindia.indiatimes.com/bus ... 274560.cms
A rupee trade basically means oil exporter country wants to import goods of equivalent value from India. Therein lies the challenge.

They need very basic stuff like grain etc.

Thanks to their commies, they managed to eff up their economy right royally, in spite of all their oil.

Austin · Post by **Austin** » 02 Apr 2018 10:46

kit wrote:If India makes rupee payments for "all" it's oil imports will it help the economy?

Well if they want to import food products , engineerings stuff from India then a rupee payment would do well. Atleast part payment can be done in such combination of Rupee and USD/Euro

Austin · Post by **Austin** » 02 Apr 2018 10:54

chetak wrote:
Austin wrote:Saudis, Russians Set To Tag-Team Oil Markets To Fend Off American Shale
a very "pious" and hypocritical ask by Mohammed bin Salman.

He has formed a jehadi NATO, headed by a paki general, no less, against syria and iran, both countries supported by the russkis.

So the russkis, for sure, already have a rather big dog in this fight.

for a start, they need the saudi NATO back the hell off, and by doing that the saudis will piss off the amrekis who want to sell shale oil to undercut the saudis.

Can things get anymore complicated and self serving??

India is already getting a lot of oil from venezuela now and maybe in rupee payments too, per press reports.

When it comes to Energy and Oil , OPEC and Russia have stabilised the market from falling further by cutting crude. So there is convergence of interest when it comes to Energy and to reduce the potential of Shale which is already non-profitable bussiness.

You still need money for exploration and oil is money intensive business so the current market suits the producer in order to sustain long exploration for oil and consumer .....Oil is neither high above $100 or low below $40

As far as US Shale goes they wont make much difference as US is a Net Importer of Energy , Shale as Business is Purely in Red sustained only by generous zero interest credit and any export of US Energy product would make it expensive to their own customers and business.

Mukesh.Kumar · Post by **Mukesh.Kumar** » 02 Apr 2018 11:29

In midst of gloom everywhere Bahrain strikes its largest oil find off west coast dwarfing current production of ~40,000 bpd.

Bloomberg

disha · Post by **disha** » 02 Apr 2018 12:56

Austin wrote:As far as US Shale goes they wont make much difference as US is a Net Importer of Energy , Shale as Business is Purely in Red sustained only by generous zero interest credit and any export of US Energy product would make it expensive to their own customers and business.

I would like to get this generous zero interest credit! Where is it coming from?

hanumadu · Post by **hanumadu** » 02 Apr 2018 15:23

Austin wrote:
When it comes to Energy and Oil , OPEC and Russia have stabilised the market from falling further by cutting crude. So there is convergence of interest when it comes to Energy and to reduce the potential of Shale which is already non-profitable bussiness.

India should go full steam ahead with electric vehicles to safeguard against such cartelisation. I don't know why we reduced our target from 100% EV to 30% EV by 2030. We should make it at least 60 - 70%.

kit · Post by **kit** » 02 Apr 2018 20:07

Austin wrote:
kit wrote:If India makes rupee payments for "all" it's oil imports will it help the economy?
Well if they want to import food products , engineerings stuff from India then a rupee payment would do well. Atleast part payment can be done in such combination of Rupee and USD/Euro

Now what if India is willing to pay a slightly higher amount or willing to forego a discount if the whole deal is done in Indian currency., would we have the surplus capacity to export?

This would be worth a serious look judging the way Russian/Saudi cartel is boosting the oil prices . Indian currency would do well to appreciate.

kit · Post by **kit** » 02 Apr 2018 20:10

Austin wrote:
chetak wrote:
As far as US Shale goes they wont make much difference as US is a Net Importer of Energy , Shale as Business is Purely in Red sustained only by generous zero interest credit and any export of US Energy product would make it expensive to their own customers and business.

Not for long

https://www.theguardian.com/business/20 ... rgy-agency

chetak · Post by **chetak** » 03 Apr 2018 09:08

https://www.youtube.com/watch?v=Ui0ZYOezJnQ

India USA Shale Oil deal - Why is India buying oil from USA? Implications, strategy and geopolitics

Austin · Post by **Austin** » 03 Apr 2018 10:47

disha wrote:
Austin wrote:As far as US Shale goes they wont make much difference as US is a Net Importer of Energy , Shale as Business is Purely in Red sustained only by generous zero interest credit and any export of US Energy product would make it expensive to their own customers and business.
I would like to get this generous zero interest credit! Where is it coming from?

QE and ZIRP/NZIRP caused by Central Bankers

http://www.resilience.org/stories/2017- ... m-is-bust/

QE and ZIRP hugely increased the availability of credit to the energy sector. ZIRP allowed oil companies to borrow from banks at extremely low interest rates, with the worth of syndicated loans to the oil and gas sectors rising from $600 billion in 2006 to $1.6 trillion in 2014. Meanwhile, in raising the price and depressing the yield of the relatively safe assets central banks purchased, QE created incentives for investors to buy assets with a higher yield, including significantly riskier corporate bonds and equities. …” (Thompson, page 50)

Austin · Post by **Austin** » 03 Apr 2018 10:51

kit wrote:
Austin wrote:
Not for long

https://www.theguardian.com/business/20 ... rgy-agency

IEA keeps changing its forecast but the business model of shale is in red , if interest rate rises in US then it will be more worse for shale.

Why Is The Shale Industry Still Not Profitable?

dug into the financials of a long list of U.S. shale companies, and found that “despite rising prices most firms under our study are still in losses with no signs of improvement.” The average return on asset for U.S. shale companies “is still a measly 0.8 percent,” the financial services company wrote in its report.

Moreover, the widely-publicized efficiency gains could be overstated, at least according to Al Rajhi Capital. The firm said that in the third quarter of 2017, the “average operating cost per barrel has broadly remained the same without any efficiency gains.” Not only that, but the cost of producing a barrel of oil, after factoring in the cost of spending and higher debt levels, has actually been rising quite a bit.

Shale companies often tout their rock-bottom breakeven prices, and they often use a narrowly defined metric that only includes the cost of drilling and production, leaving out all other costs. But because there are a lot of other expenses, only focusing on operating costs can be a bit misleading.

If US exports Oil then it will affect its domestic market assuming that it even come to a state where it has sustained surplus oil to export. Shale is beneficial to local industry as it gives them cheaper source of energy.

Other than that there is nothing much in shale , The environment damage it has cause is enormous and OPEC and Russia have conventional oil and gas than is cheaper to extract and process ......Shale is profitable only if Oil prices are at $100 but that is opening another pandora box .......enuf said

kit · Post by **kit** » 03 Apr 2018 23:39

Austin wrote:
kit wrote:
Not for long

https://www.theguardian.com/business/20 ... rgy-agency
IEA keeps changing its forecast but the business model of shale is in red , if interest rate rises in US then it will be more worse for shale.

Why Is The Shale Industry Still Not Profitable?
dug into the financials of a long list of U.S. shale companies, and found that “despite rising prices most firms under our study are still in losses with no signs of improvement.” The average return on asset for U.S. shale companies “is still a measly 0.8 percent,” the financial services company wrote in its report.

Moreover, the widely-publicized efficiency gains could be overstated, at least according to Al Rajhi Capital. The firm said that in the third quarter of 2017, the “average operating cost per barrel has broadly remained the same without any efficiency gains.” Not only that, but the cost of producing a barrel of oil, after factoring in the cost of spending and higher debt levels, has actually been rising quite a bit.

Shale companies often tout their rock-bottom breakeven prices, and they often use a narrowly defined metric that only includes the cost of drilling and production, leaving out all other costs. But because there are a lot of other expenses, only focusing on operating costs can be a bit misleading.

If US exports Oil then it will affect its domestic market assuming that it even come to a state where it has sustained surplus oil to export. Shale is beneficial to local industry as it gives them cheaper source of energy.
Other than that there is nothing much in shale , The environment damage it has cause is enormous and OPEC and Russia have conventional oil and gas than is cheaper to extract and process ......Shale is profitable only if Oil prices are at $100 but that is opening another pandora box .......enuf said

Shale oil in USA breaks even @ 40-50 USD

https://www.reuters.com/article/us-usa- ... SKBN1AP25M

Austin · Post by **Austin** » 05 Apr 2018 20:33

Depends on the field , some field have lower break even and some higher but as a Business Shale is a loss making one no matter what their break even is.

Break even for Saudi and Russian field is any where between $4 to $15 but to be profitable and to take into account transport ,refining , investing in future field and research takes far more than break even , it required a huge money to be spent ......If break even was the bench mark Opec and Russia would be happy if brent was at $20 but both prefer a price above $50-60 , that takes care of oil business present and long term huge investment is needed today to make sure you have oil 10 years from today.

Shale is good for US Industry as long as interest rates remain very low and there is no immediate price to pay for the long term environmental damage it causes. It in itself is not a profitable business but helps the US industry to get cheaper source of energy , cheaper then what they would pay for imports.

Vips · Post by **Vips** » 07 Apr 2018 19:15

Most important is the strategic space it gives to the US in not allowing prices to rise beyond a certain limit or it enriches its foes like Russia. The value of denying that opportunity cost to Russia is beyond any calculation.

Austin · Post by **Austin** » 07 Apr 2018 19:58

Vips wrote:Most important is the strategic space it gives to the US in not allowing prices to rise beyond a certain limit or it enriches its foes like Russia. The value of denying that opportunity cost to Russia is beyond any calculation.

Russia dependencies on oil is low compared to OPEC where its budget high as 90 % , Infact it was OPEC that went into tizzy when Oil reached $30 becuase their currency was not flexible and import was draining forex , THat prompted OPEC to go for deal with non-opec country like Russia.

Russia can be flexible at any oil price because of floating rouble exchange they dont have to spend forex to defend the rouble. OPEC cant withstand low oil price as can be seen with Saudi panicking.

In the end any one is foolish to belive Oil prices can be low due to non multiple factors including finding reserves and if it is not profitable to pump they wont which will automatically create demand supply issue

SOmething unexpected though happened is it brought Saudi and Russia closer no one would have thought that would every happen

Vips · Post by **Vips** » 07 Apr 2018 23:48

Austin wrote: Russia dependencies on oil is low compared to OPEC where its budget high as 90 % , Infact it was OPEC that went into tizzy when Oil reached $30 becuase their currency was not flexible and import was draining forex , THat prompted OPEC to go for deal with non-opec country like Russia.

Russia can be flexible at any oil price because of floating rouble exchange they dont have to spend forex to defend the rouble. OPEC cant withstand low oil price as can be seen with Saudi panicking.

Question is for what will it offer to rest of the world (other then oil/arms) and how long can its sustain its economy to retains its status as a big economy on the basis of the rouble?

Austin wrote:In the end any one is foolish to belive Oil prices can be low due to non multiple factors including finding reserves and if it is not profitable to pump they wont which will automatically create demand supply issue

That is true for countries having diversified/multiple source of export income. Almost all the OPEC countries are dependent on Oil as their source of foreign exchange earnings so for them there is no choice but pump oil at whatever price (even as low as $28/barrel)

Austin wrote: SOmething unexpected though happened is it brought Saudi and Russia closer no one would have thought that would every happen

Yes, its upto US and Canada now to pump larger volumes of oil to offset the cut agreed by Saudi and Russia. Had Venezuela been with Uncle Sam today, it would have been game over for OPEC/Russia.

Vasu · Post by **Vasu** » 12 Apr 2018 11:59

Part of Aramco's global strategy to secure buyers and move up the value chain. Significant FDI if the MoU materializes.

Saudi Aramco's $44-bn deal may change the entire oil game for India

NEW DELHI: Saudi Aramco, the world's biggest oil company, on Wednesday announced a $44-billion deal to build a giant refinery complex in India with three Indian oil majors.

The refinery at Ratnagiri in Maharashtra will be handle up to 1.2 million barrels of oil a day, the Saudi company said in a statement after signing a memorandum of understanding with Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation.

The Ratnagiri complex "will rank among the largest world refining and petrochemicals projects and will be designed to meet India's fast-growing fuels and petrochemicals demand. The project cost is estimated at around $44 billion."

The Indian accord is just the latest in a string of deals — with French, US and Malaysia companies — announced by Aramco as it seeks to secure buyers for its oil.

Indian Oil, Bharat Petroleum and Hindustan Petroleum have set up a joint venture for the deal with Aramco, Ratnagiri Refinery and Petrochemicals Ltd.

Aramco said it may "seek to include a strategic partner to co-invest in the mega refinery".

Aramco and French firm Total this week announced a $5 billion deal to build a refinery at Jubail in Saudi Arabia.

Last month the Saudi firm awarded more than $8 billion worth of contracts to US firms to boost its US refinery operations.

Aramco has also pledged billions of dollars for deals in Malaysia and Indonesia in the past year.

arun · Post by **arun** » 13 Apr 2018 11:46

^^^ More on the above story.

Saudi Aramco media release on signing a MOU with Ratnagiri Refinery and Petrochemicals Ltd (RRPCL), a consortium of PSU refiners Indian Oil Corporation, Bharat Petroleum Corporation and Hindustan Petroleum Corporation, to establish an integrated 1.2 million bpd refinery and petrochemical complex at Nanar in Ratnagiri district of Maharashtra:

Saudi Aramco and Indian consortium “RRPCL” sign MoU to develop Ratnagiri mega refinery and petrochemicals complex on India’s west coast

NEW DELHI, India, April 11, 2018

President & CEO Amin H. Nasser: “Investing in India is a key part of Saudi Aramco’s global downstream strategy, and another milestone in our growing relationship with India.”

Saudi Aramco signed today a Memorandum of Understanding (MOU) with “President & CEO Amin H. Nasser: “Investing in India is a key part of Saudi Aramco’s global downstream strategy, and another milestone in our growing relationship with India.”

Saudi Aramco signed today a Memorandum of Understanding (MOU) with “Ratnagiri Refinery and Petrochemicals Ltd.” (RRPCL), a consortium of Indian oil companies which includes The Indian Oil Corporation Ltd. (IOCl), Bharat Petroleum Corporation Ltd. (BPCL), and Hindustan Petroleum Corporation Ltd. (HPCL), to jointly develop and build an integrated mega refinery and petrochemicals complex at Ratnagiri, in the state of Maharashtra. Saudi Aramco may also seek to include a strategic partner to co-invest in the mega refinery.

The strategic partnership brings together crude supply, resources, technologies, experience, and expertise of these multiple oil companies with an established commercial presence around the world.

A pre-feasibility study for the refinery has been completed and the parties are now finalizing the project’s overall configuration. Following the signing of the MOU, the parties will extend their collaboration to discuss the formation of a joint venture that would provide for joint ownership, control, and management of the project.

The refinery will be capable of processing 1.2 million barrels of crude oil per day. It will produce a range of refined petroleum products, including gasoline and diesel, meeting BS-VI fuel efficiency norms. The refinery will also provide feedstock for the integrated petrochemical complex, which will be capable of producing approximately 18 million tons per annum of petrochemical production.

In addition to the refinery, cracker and downstream petrochemical facilities, the project will include associated facilities such as a logistics, crude oil and product storage terminals, raw water supply, as well as centralized and shared utilities.

Ratnagiri Refinery and Petrochemicals Ltd. (RRPCL) will rank among the largest world refining and petrochemicals projects and will be designed to meet India’s fast-growing fuels and petrochemicals demand. The project cost is estimated at around $44 billion.

“Investing in India is a key part of our company’s global downstream strategy, and another milestone in our growing relationship with India,” said Saudi Aramco President and CEO Amin H. Nasser, who also noted the opening in 2017 of Aramco Asia’s New Delhi office with a mandate to expand Saudi Aramco’s international portfolio in this key economic growth region.

“The signing marks a significant development in India’s oil and gas sector, enabling a strategic joint venture and investment partnership that will serve India’s fast-growing demand for transportation fuels and chemical products. Participating in this mega project will allow Saudi Aramco to go beyond our crude oil supplier role to a fully integrated position that may help usher in other areas of collaboration, such as refining, marketing, and petrochemicals for India’s future energy demands,” said Nasser..” (RRPCL), a consortium of Indian oil companies which includes The Indian Oil Corporation Ltd. (IOCl), Bharat Petroleum Corporation Ltd. (BPCL), and Hindustan Petroleum Corporation Ltd. (HPCL), to jointly develop and build an integrated mega refinery and petrochemicals complex at Ratnagiri, in the state of Maharashtra. Saudi Aramco may also seek to include a strategic partner to co-invest in the mega refinery.

The strategic partnership brings together crude supply, resources, technologies, experience, and expertise of these multiple oil companies with an established commercial presence around the world.

A pre-feasibility study for the refinery has been completed and the parties are now finalizing the project’s overall configuration. Following the signing of the MOU, the parties will extend their collaboration to discuss the formation of a joint venture that would provide for joint ownership, control, and management of the project.

The refinery will be capable of processing 1.2 million barrels of crude oil per day. It will produce a range of refined petroleum products, including gasoline and diesel, meeting BS-VI fuel efficiency norms. The refinery will also provide feedstock for the integrated petrochemical complex, which will be capable of producing approximately 18 million tons per annum of petrochemical production.

In addition to the refinery, cracker and downstream petrochemical facilities, the project will include associated facilities such as a logistics, crude oil and product storage terminals, raw water supply, as well as centralized and shared utilities.

Ratnagiri Refinery and Petrochemicals Ltd. (RRPCL) will rank among the largest world refining and petrochemicals projects and will be designed to meet India’s fast-growing fuels and petrochemicals demand. The project cost is estimated at around $44 billion.

“Investing in India is a key part of our company’s global downstream strategy, and another milestone in our growing relationship with India,” said Saudi Aramco President and CEO Amin H. Nasser, who also noted the opening in 2017 of Aramco Asia’s New Delhi office with a mandate to expand Saudi Aramco’s international portfolio in this key economic growth region.

“The signing marks a significant development in India’s oil and gas sector, enabling a strategic joint venture and investment partnership that will serve India’s fast-growing demand for transportation fuels and chemical products. Participating in this mega project will allow Saudi Aramco to go beyond our crude oil supplier role to a fully integrated position that may help usher in other areas of collaboration, such as refining, marketing, and petrochemicals for India’s future energy demands,” said Nasser.

Saudi Aramco Clicky

Austin · Post by **Austin** » 21 Apr 2018 17:54

Oil price not OPEC objective, secretary general notes

More:
http://tass.com/economy/1001015

Mort Walker · Post by **Mort Walker** » 21 Apr 2018 20:47

Austin wrote:Depends on the field , some field have lower break even and some higher but as a Business Shale is a loss making one no matter what their break even is.

Break even for Saudi and Russian field is any where between $4 to $15 but to be profitable and to take into account transport ,refining , investing in future field and research takes far more than break even , it required a huge money to be spent ......If break even was the bench mark Opec and Russia would be happy if brent was at $20 but both prefer a price above $50-60 , that takes care of oil business present and long term huge investment is needed today to make sure you have oil 10 years from today.

Shale is good for US Industry as long as interest rates remain very low and there is no immediate price to pay for the long term environmental damage it causes. It in itself is not a profitable business but helps the US industry to get cheaper source of energy , cheaper then what they would pay for imports.

Interest rates have been going up and are projected to rise. The oil industry makes some really obscene profits and have a tendency of throwing their employees under a bus.

At this time shale oil may loss for the smaller players, but shale oil production is actually ramping up in the west Texas Permian Basin and North Dakota Bakken formation. The Permian Basin is now ramping up oil to over 3.5 million BPD and over 4 million BPD by 2020. What you also have to remember is that technology is changing too. What we're seeing now is a transition stage for shale oil business.

I can't quote the full article from the WSJ as it is subscription based.

“It makes sense that the basin with the lowest costs, seeing the biggest increase in growth would also see the most bottlenecks and the most challenges to that growth,” said John Dowd, manager of the Fidelity Select Energy Portfolio. “It’s not physically easy to grow production 1 million barrels a day in the U.S.”

After crude prices fell from more than $100 a barrel in 2014 to less than $30 two years later, companies in many areas shut down rigs and cut spending.

But in the Permian basin, production never stopped. As oil prices have climbed, the pace of work in the region has become frenetic, with production rising by about 800,000 barrels a day in the past year.

Pipeline capacity is emerging as a problem. Oil is starting to back up in West Texas and has recently sold at a $6 to $9 discount to crude prices elsewhere in the U.S. That is a warning sign that some oil might have to travel by more expensive ways like trucks to market and that producers could be forced to take drastic measures like halt drilling.

Austin · Post by **Austin** » 21 Apr 2018 21:01

IT is good that Shale Oil out out is growing because it is good for US industry and world as Demand for Energy is growing according to EIA.

A high oil price is good for every one be it Shale Producers , OPEC , Russians , BP , Exxon ,Shell etc because it bring profit not only to companies and note that US has big oil companies like Exon in the business but also to their share holders.

The link I posted above from OPEC secretary clearly tell about the mood in OPEC and how even US shale companies are benefiting from it.

A price from $60 to $80 is good for every one the producer and customer.

Mort Walker · Post by **Mort Walker** » 22 Apr 2018 05:37

How the heck can you say oil in the $60-$80 is good for everyone? High oil price is not good for India. Oil needs to be below $50/barrel for India to quickly grow. Too much of India's Forex goes to pay for oil.

The good thing about shale oil in the US is that technology is progressing too. There has been much progress in geoscience and petroleum engineering.
In a few years the shale oil producers will frack using CO2 instead of water thereby sequestering it. Privately these players are saying below $30/barrel will ensure steady profit. Whatever it is, shale oil production will put pressure on OPEC and Russia in the next few years. The US will be producing well over 10 MBPD shale oil after 2022.