American Energy Disrupts OPEC’s Influence

[Elderberry]

Texas Energy Report by Railroad Commission of Texas Commissioner Ryan Sitton 5/26/2017

The OPEC cartel’s plan to continue its production cuts for nine more months means that two worlds — energy and politics — are once again colliding. Energy observers today are feverishly trying to anticipate what will happen with the basic cost of energy, which has the ability to upset manufacturing capabilities, trade practices, and even entire economic markets. With all the uncertainty, one thing is clear. American energy production is disrupting OPEC plans and influencing energy prices more than it has in a generation.

As a Texas energy regulator, I am often asked about the impact of Texas oil and gas on the rest of the world’s oil activities. Throughout my 20 years as an engineer working in the energy industry, I’ve had the opportunity to travel all over the world and witness Texas’ influence firsthand.  Today, one quarter of all U.S. oil output comes from the Permian Basin, and projections show that number will continue to rise.. On May 25 we watched as the advances of the shale producers in Texas and the U.S. forced the hand of the OPEC nations – and they extended cuts to support prices.

So what can we glean from the cartel’s action? First, OPEC nations are indicating that they believe the market can come into supply and demand balance based on existing production levels. Second, it appears that OPEC countries are accepting the current price environment. Last and most notably, OPEC nations are beginning to bump up against their limits in controlling prices.

What that means for Texas oil and gas producers is that there’s more global demand that they can fill at current pricing levels. Energy exports of oil, liquefied natural gas, chemicals and refined products hold enormous opportunities for our country.

More: http://www.texasenergyreport.com/Buzz/Buzz.cfm

[Smokin Joe]

Right behind you!

[Elderberry]

Keep Up!

[Smokin Joe]

Keep Up!

LOL! We're trying to work against a bunch of guys in Texas deciding whether we can drill. That isn't fair.  We have a ways to go to catch you, but we just got another 500000 BOPD in takeaway capacity, so all we need is a little hotter market.

[IsailedawayfromFR]

LOL! We're trying to work against a bunch of guys in Texas deciding whether we can drill. That isn't fair.  We have a ways to go to catch you, but we just got another 500000 BOPD in takeaway capacity, so all we need is a little hotter market.

the elephant in the room lives north of you.  All they need is a bit more price and they surge.

[dfwgator]

Screw the OPECkers.

[Smokin Joe]

the elephant in the room lives north of you.  All they need is a bit more price and they surge.

True, but I bought oil sands stock cheap....Besides, we knew that was the reason for Keystone, not Bakken/US Williston Basin oil.

[IsailedawayfromFR]

True, but I bought oil sands stock cheap....Besides, we knew that was the reason for Keystone, not Bakken/US Williston Basin oil.

actually, the reason for Keystone is the supply to Gulf Coast refineries.  They need the lower gravity crude to blend with the higher gravity crude from the unconventional.

[Smokin Joe]

actually, the reason for Keystone is the supply to Gulf Coast refineries.  They need the lower gravity crude to blend with the higher gravity crude from the unconventional.

I thought all that bitumen was going to more or less replace the faltering supply of Venezuelan Crude. My understanding the Bakken oil riding out on that line was to make it easier to pump the low gravity stock.

[IsailedawayfromFR]

I thought all that bitumen was going to more or less replace the faltering supply of Venezuelan Crude. My understanding the Bakken oil riding out on that line was to make it easier to pump the low gravity stock.

maybe both true

@thackney

[thackney]

The lighter Bakken oil helps but the Canadian oil has already been upgraded or diluted just to get out of Canada in the first place.  A significant​ amount is also headed to the Midwest.

[Smokin Joe]

The lighter Bakken oil helps but the Canadian oil has already been upgraded or diluted just to get out of Canada in the first place.  A significant​ amount is also headed to the Midwest.

I read up on that some yesterday. "Dilbit" and "Synbit" are the terms for the bitumen diluted with condensates or other crude. Oddly enough, that was catching as much grief as Bakken oil by rail because at that point the properties were similar in terms of volatiles.

It's a environmentalist blog, but this article mentioned the transport problem, similar to rail accidents with Bakken Crude trains. https://www.desmogblog.com/2015/03/09/tar-sands-rail-disasters-latest-wave-bomb-train-assault

[Wingnut]

Screw the OPECkers.

And Jimmah The Peanut Carter too!

[thackney]

I read up on that some yesterday. "Dilbit" and "Synbit" are the terms for the bitumen diluted with condensates or other crude. Oddly enough, that was catching as much grief as Bakken oil by rail because at that point the properties were similar in terms of volatiles.

It's a environmentalist blog, but this article mentioned the transport problem, similar to rail accidents with Bakken Crude trains. https://www.desmogblog.com/2015/03/09/tar-sands-rail-disasters-latest-wave-bomb-train-assault

When they use measurable quantities like gravity, vapor pressure and flammable, auto-ignight temperatures,I can take their comparisons seriously.  When the use intentionally vague terms, I know they are only trying to mislead.

[IsailedawayfromFR]

When they use measurable quantities like gravity, vapor pressure and flammable, auto-ignight temperatures,I can take their comparisons seriously.  When the use intentionally vague terms, I know they are only trying to mislead.

Amen to that.

A more pragmatic understanding might be made if one looks at other than an environmental outlook, like this company I am familiar with that is in the real business of doing this.

http://fractalsys.com/science/

[Smokin Joe]

When they use measurable quantities like gravity, vapor pressure and flammable, auto-ignight temperatures,I can take their comparisons seriously.  When the use intentionally vague terms, I know they are only trying to mislead.

Well, it was an enviro blog, just came up on the search engine.

I don't expect facts from them anyway, but the basics make some sense (except for the general panic). Far easier to push something down the pipe or load/unload it on rail cars that has a lower viscosity than peanut butter. (I worked a well in NV that had 11 gravity oil. During the DST we caught some in a styrofoam cup and it set up at ambient (about 80 degrees F) within a few minutes. Inverted the cup and nothing came out.)

[IsailedawayfromFR]

(I worked a well in NV that had 11 gravity oil. During the DST we caught some in a styrofoam cup and it set up at ambient (about 80 degrees F) within a few minutes. Inverted the cup and nothing came out.)

That won't flow much to surface.

Unless it is close to surface, that one was a lost cause.

[Joe Wooten]

Well, it was an enviro blog, just came up on the search engine.

I don't expect facts from them anyway, but the basics make some sense (except for the general panic). Far easier to push something down the pipe or load/unload it on rail cars that has a lower viscosity than peanut butter. (I worked a well in NV that had 11 gravity oil. During the DST we caught some in a styrofoam cup and it set up at ambient (about 80 degrees F) within a few minutes. Inverted the cup and nothing came out.)

I think there is an oilfield in California that is so viscous it requires steam heat to allow it to be pumped to the surface. At one time in themed 1970's there was a proposal to build a nuke plant to supply both steam for heating the oil in the boreholes and supplying the power to pump it out. Previous activities used oil fired boilers.

[Wingnut]

It is a damn shame what happened to the Nuke Power movement.   It was just last year when the “newest” (and probably 4th from the last ever to be built) nuclear reactor in the U.S. went online. It was built with 1960s technology, took 43 years to complete and cost $6.1 billion. In March of this year, the reactor went down and has yet to be fixed.

[Joe Wooten]

It is a damn shame what happened to the Nuke Power movement.   It was just last year when the “newest” (and probably 4th from the last ever to be built) nuclear reactor in the U.S. went online. It was built with 1960s technology, took 43 years to complete and cost $6.1 billion. In March of this year, the reactor went down and has yet to be fixed.

Oh they are working on getting the condenser fixed. I was at Watts Bar 2 for 2 years doing startup. A weld on the main condenser B shell failed during startup from the first refueling outage and the resulting implosion badly damaged the condenser tubes and supports. I should be getting photos of it soon. Damage like this does not get fixed very quickly.

[Wingnut]

I used to wrap large vessels with ceramic tiles to preheat stress weld points in the field and at the Old Westinghouse plant near Pensacola.   Sounds like maybe something got out of whack?  or not.

[Joe Wooten]

I used to wrap large vessels with ceramic tiles to preheat stress weld points in the field and at the Old Westinghouse plant near Pensacola.   Sounds like maybe something got out of whack?  or not.

Supposedly the welds on the main condenser were inspected for corrosion and structural integrity. They failed on this one. I'd bet since this was a non-safety component, the inspectors just skipped over it and fudged the paperwork, what little there is on a B31.1 system.

[IsailedawayfromFR]

I think there is an oilfield in California that is so viscous it requires steam heat to allow it to be pumped to the surface. At one time in themed 1970's there was a proposal to build a nuke plant to supply both steam for heating the oil in the boreholes and supplying the power to pump it out. Previous activities used oil fired boilers.

I worked those oilfields out of Bakersfield.  It is the birthplace of steam injection for oil recovery, began by Getty Oil at the Kern River field in the 60s.  Lot of other large steamfloods there as well.  Initially, the source of the steam was via heat generation by burning lease crude.  Besides its ready availability(little gas production in such heavy crude), it was allowed per leasehold terms in most places to use it free of royalty so it was practical at the time. 

Gradually, heat generation was turned over to natural gas instead, mostly as oil was a more valuable product for sales and gas was cheap.

Athabasca is where I heard the idea of nuclear-generated steam to assist in oil production/recovery.  It makes the most sense there as the resources are some of the largest in the world, and is a lot more viscous in a colder climate than the fields in CA.

Of all the technologies out there to assist in oil recovery (steam, fireflood, chemical, CO2, surfactant, etc.) steam far and away has the most usage on the world stage.  Recovery gains in those viscous fields can increase from 0% without steam to over 90% with effective usage.

That's a lot of oil.

[Smokin Joe]

That won't flow much to surface.

Unless it is close to surface, that one was a lost cause.

Extremely high heat flow in the area, depth around 5200 ft. at the top of the reservoir. A well a couple of miles away had a deviation problem and the film cooked in the wireline survey tool two out of three times before it could get back to surface, on average. Without that high bottom hole temp, we'd never have seen oil to surface.
In that area, though, winter temps can drop below zero (go to the desert, you'll be warm..) so production was a real problem, as it would have to be trucked out. In the end it was considered that at that gravity and those flow rates and with other complicating market factors the well would be marginal and it has since been shut in: two of three wells in the field are shut in, one P&A.
Wildcats in Nevada were always a longshot (1 in 75 hit), but when they hit, often they really hit.
Across the valley, there was the Blackburn field...which had produced over a million barrels of oil by the time we drilled the well we were on.

That area has incredible potential for shale (most likely gas) production, as yet unassessed, thanks to the usual (Federal) suspects. This article summed it up: Fed govt: No, Nevada, you cannot have oil-and-gas prosperity.

[Smokin Joe]

It is a damn shame what happened to the Nuke Power movement.   It was just last year when the “newest” (and probably 4th from the last ever to be built) nuclear reactor in the U.S. went online. It was built with 1960s technology, took 43 years to complete and cost $6.1 billion. In March of this year, the reactor went down and has yet to be fixed.

I started my Master's work on Uranium geochemistry. By the end of the first year, Three Mile Island had happened, and I had hired on in the oil patch. I finished out the school year and went to work.