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World’s 2nd Largest Oil Company Sees Huge Drop In Profit

World’s 2nd Largest Oil Company Sees Huge Drop In Profit

China’s Sinopec, the world’s second…

Trump’s Plan Makes 65 Billion BOE Available For Drilling

Trump

Rystad Energy expects the Trump administration’s new oil and gas leasing plan to make 65 billion barrels of oil equivalent newly available to fossil fuel exploration and production companies, according to a new report by Reuters.

"Looking purely at areas that are potentially going to come out of restriction, we are talking about something closer to 65 billion boe," Rystad senior analyst Sonia Passos said in a note.

The proposal, officially announced last week, has met with severe resistance in Florida, where the coastal tourism sector stands to lose from any accidental oil spills caused by the new drilling. Trump’s White House announced yesterday that waters around Florida would not be authorized for deep sea drilling after the state’s Republican governor took a strong stand against the draft plan.

Interior Secretary Ryan Zinke said, “I support the governor’s position that Florida is unique and its coasts are heavily reliant on tourism as an economic driver. As a result of discussion with Governor (Rick) Scott and his leadership, I am removing Florida from consideration for any new oil and gas platforms.”

Still, the remaining lease potential should generate plenty of new opportunities for fossil fuel majors, according to Rystad.  

“The resource potential in the basins in the direct proximity to Florida, together may hold about 1 billion boe to 1.5 billion boe, so excluding those will not change the overall picture dramatically,” Passos told Reuters on Wednesday.

The Energy Information Administration now estimates that U.S. crude oil production could hit 11 million barrels daily by late 2019, overtaking both Saudi Arabia and Russia. This year, the EIA said, U.S. drillers could pump an average 10.3 million barrels per day, with growth this year seen at almost 2 million bpd, slowing down to 1.3 million bpd in 2019.

By Zainab Calcuttawala for Oilprice.com

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  • Mamdouh G Salameh on January 11 2018 said:
    Bonanza it is not. Out of an estimated 65 billion oil equivalent (boe), may be 5 boe could be recoverable given the difficult terrain and the very high costs. We may not see real production before at least five years. By then somebody else will be in the White house and he may reverse Trump's offshore exploration policies as he did with Obama's.

    The estimate by the US Energy Information Administration (EIA) that U.S. crude oil production could hit 11 million barrels a day (mbd) by late 2019, overtaking both Saudi Arabia and Russia is far off the mark. More humility and less exaggeration from the EIA might be the order of the day.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

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