The United States, Canada, China, and Argentina are currently the only four countries in the world that are producing commercial volumes of either natural gas from shale formations (shale gas) or crude oil from tight formations (tight oil). The United States is by far the dominant producer of both shale gas and tight oil. Canada is the only other country that produces both shale gas and tight oil.

The US has another shale oil area about to generate large production volumes.  A new study by energy analyst Wood Mackenzie finds South Central Oklahoma will be as significant as the Eagle Ford basin in the state of Texas and the Bakken area in the state of North Dakota. The breakeven production price in South Central Oklahoma is $41 per barrel, well below the current world price of crude oil.  Wood Mackenzie expects production in this region to surpass 1 million barrels of oil equivalent per day by 2020.

The Marcellus shale natural gas formation, located in the northeast US, accounts for almost 40% of all shale gas produced in that country.

Total Canadian crude oil production increased 8% to 3.8 million b/d for 2014.  However, the heavier grade of crude oil that comes from the oil sands held more or less steady at 1.7 million b/d on average during the last six months of 2014. Production of heavy Canadian crude oil in general increased just 1% from June to December versus 10% a year earlier. The slowdown reflects the fact that Canadian oil output is expensive to produce in a period of rapidly declining world oil prices.

Total SA plans to eliminate 2,000 jobs by 2017 and sell assets worth $5.5 billion this year as the French oil and gas group adapts its business to a world of sharply lower oil prices. The company, one of Europe’s largest crude oil producers, said it would freeze the hiring of new staff at its production, refinery, and petrochemicals operations as part of plans to cut costs by $4 billion this year.  The company said it can earn a profit when oil prices are at $70 per barrel.

Over the past month the largest oil services companies (Baker Hughes, Halliburton, and Schlumberger) announced labour cutbacks with the declining production of crude oil globally. Last week Halliburton announced plans to lay off up to 6,400 of its 80,000 worldwide work force.

The African country of Somalia may start producing crude oil and natural gas by 2020 after exploration work showed the potential for “huge” deposits of these resources. Somalia is considering its first bidding round for crude oil blocks since 2009 as increasing stability begins to attract more foreign investors.

South African President Jacob Zuma said his priority is to solve the energy crisis in the country that is limiting the output at mines and factories and stifling economic growth. Plans include adding more nuclear power by 2023.

In the Middle East, the startup of two huge petroleum refineries earlier this year is about to shake up fuel markets from Asia to Europe as the oil-producing region expands its influence beyond just exporting vast amounts of unprocessed crude oil. The projects, together with a third large refinery that began operating in Saudi Arabia last year, are expected to process 1.2 million barrels of oil a day at full capacity in the next few months, equivalent to slightly more than 1% of the world’s total oil-refining capacity.

General Motors announced it will add wind power to its energy portfolio for the first time in the history of the company. The construction of the 34 megawatt wind farm in Palo Alto, 325 miles (526 km) from Mexico City, will begin later this year. When complete, 75% of the wind farm’s energy will power GM’s factory facilities in Toluca, and will also provide electricity for other GM plants in Silao, San Luis Petosi and Ramos Arizpe.

The world’s first wave-energy farm connected to the electricity grid has been switched on in Western Australia. The project by  Carnegie Wave Energy will provide renewable electricity for Australia’s largest naval base, HMAS Stirling. The system also operates a small desalination plant, which will be used to supply up to one-third of the base’s fresh water needs. The units provide enough energy to power the equivalent of between 1,500 to 2,000 households.

Japan has more electric-car charging points than gas stations. Nissan Motor Co. reports the number of charging points in the Asian country, including fast-chargers and those in homes, has reached 40,000, surpassing the nation’s 34,000 gas stations.

 

with h/t Tom Whipple

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