A Look in the Rear View, Part II

A Look in the Rear View, Part II

The oil and gas industry’s adaption of renewable energies quickened its pace in 2020 as producers, midstream operators, and refiners rolled out new initiatives and investments to power their operations and reduce emissions. Here’s a look at just a few. Houston-based Occidental, a longtime developer and investor of low-carbon technologies and fuels, announced this month it will design and build the world’s largest carbon capture facility in N.D. The company last Fall completed a 174-panel, 120-acre solar farm in the Permian, which now replaces all grid power and supplies all energy for Oxy’s Goldsmith oilfield operations. Tulsa-based midstream giant Williams in May announced it, too, would add solar to its natural gas transmission and processing operations in nine states. But oil refiners, in particular, have been left with little choice to accelerate their shift from fossil fuels to renewable sources. The fallout from COVID and ever-stringent emissions regulations have prompted the largest to the smallest refineries to convert feedstocks to biofuels, such as soybean oil, fats, and kitchen grease. Time to: adapt, re-think, survive.

What do you think? Learn more about our upstream, midstream, and downstream expertise at www.ReeseEnergyConsulting.com.

 

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A Look in the Rear View, Part I

A Look in the Rear View, Part I

With the end of 2020 mercifully in sight, Top 10 lists of the year’s most defining events in the oil and gas industry have begun to pop up depending on which news sites and publications you tend to follow. Reese Energy Consulting won’t be compiling such a list because, frankly, ours would cover at least 100+. But in retrospect, a few moments stand out as transformative for an industry that has always faced adversity. First, the April crude oil storage crisis. Following the trifecta of a pandemic, an OPEC spat, and a crash that redlined crude into negative territory, global demand for oil fell into an abyss. U.S. producers scrambled to find vacancies for their supplies amid a massive oil glut that birthed an equally massive demand to store it all. This led to the government offering storage at the Strategic Petroleum Reserve, virtually rent-free. Producers leased floating tankers and underground salt caverns, commissioned trucks and trains, and repurposed frac tanks. The panic for more storage rippled from most every prolific producing basin, leading us to make some hard and fast decisions about drilling and output. Not what we wanted but what we had to do. Time to: get creative, adjust to conditions, never take storage for granted.

What do you think? Learn more about our upstream, midstream, and downstream services at www.ReeseEnergyConsulting.com.

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Two Sweet Bites for Diamondback

Two Sweet Bites for Diamondback

Midland, Texas-based Diamondback Energy is as much at home in the Permian as its indigenous rattler namesake. Formed in 2007 with an initial acquisition of 4,174 net acres, Diamondback has continued to expand its presence in the Land of Crude Oil Honey, also known as the Midland and Delaware sub-basins. Following a $7 billion merger in 2018 with Energen, the company was suddenly thrust into the realm of large-cap Permian E&P independent with 390,000 net acres. Reese Energy Consulting today is following the latest strikes by Diamondback, which now has snatched up two more Permian rivals for a combined $3.2 billion. First up is Irving, Texas-based Guidon Energy in a cash-and-stock deal valued at $850 million that adds 32,000 net acres in the Midland. Next, Denver-based QEP Resources in an all-stock transaction valued at $2.2 billion that includes 49,000 net acres in the Midland with 3Q production of about 48.3 MBPD and a Williston Basin stepchild Diamondback most certainly will look to offload. Because for some E&Ps, there’s simply no place like home than the Permian.

 

Diamondback Energy

Diamondback Energy is a company engaged in hydrocarbon exploration. It is organized in Delaware and headquartered in Midland, Texas.

diamondbackenergy.com

What do you think? Learn more about our range of producer and midstream services at www.ReeseEnergyConsulting.com.

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