A weekly update on issues important to the oil and gas industry
Natural gas markets continue an optimistic trend towards greater demand to meet a U.S. supply glut. The incoming Trump Administration has promised to pull back regulatory restraints and unleash the industry to “drill baby drill.” However, when it comes to natural gas, there is already plenty of supply; the question is, can that supply become more portable to meet global (instead of regional) demands? We explore this question and a potential answer in this week’s post.
As a supplement to our usual regional coverage, this quarter we take a closer look at the Bakken, DJ Basin, and Woodford Shale. On an oil equivalent basis, the DJ Basin ended the review period 2% below production levels from a year earlier, while the Bakken ended at nearly 5% lower. Only the Woodford Shale ended the review period at a level above its November 2023 production, though at a negligible 0.1% higher. While not nearly in the same league as the powerhouse Permian Basin, the Bakken Shale, DJ, and Woodford Shale play an important role in U.S. energy production.
The November election brought optimism to many oil producers who felt hamstrung by the Biden Administration’s policies. However, administrations can only do so much when it comes to global supply and demand dynamics. In fact, they can usually do little in the big picture; and the big picture is that there is probably going to be more supply coming online in 2025 than demand to meet it. Therefore, U.S. upstream producers are not planning on blowing their budget on aggressive drilling plans, no matter what Trump says, especially considering the lukewarm pricing environment that the market foresees. In addition, the U.S.’ shale dominance may be headed towards inevitable decline. We consider the 2025 U.S. oil and gas outlook in this week’s post.
While not nearly in the same league as the powerhouse Permian Basin, the Bakken Shale, DJ, and Woodford Shale play an important role in U.S. energy production. While these basins mostly experience the same impacts that U.S. energy policy and geopolitical matters have on the primary U.S. basins, they each have unique characteristics that differentiate them from the larger basins and each other. In this post, we depart from our regular coverage and take a closer look at the Bakken, DJ Basin, and Woodford Shale.
This week, the Mercer Capital Oil and Gas team highlights four popular, but less talked about oil and gas plays: the Uinta Basin, Bakken Shale, DJ Basin, and SCOOP/STACK. From the Uinta’s unique transportation challenges to the Bakken’s enduring output, the DJ’s infrastructure, and the SCOOP/STACK’s operational complexities, we explore their economic profiles and recent M&A activity.
Year-end 2024 is quickly approaching so that means it’s time to take a look back at the year. Here are the top ten posts for the year measured by readership. Click on any of the post titles to revisit the post. Thank you to our readers for your constant support! It’s our honor to cover the oil & gas industry for you. We are taking the next two weeks off from the blog to celebrate the holidays but we’ll be back next year!
Mercer Capital has its finger on the pulse of the minerals market. The most recent Mineral Aggregator Valuation Multiples Study is now available.
This week, we explore the Q3 2024 earnings calls of Upstream and OFS companies, noting a focus on technological efficiency, optimized capital allocation, and expectations for natural gas demand in the long term. We examine some notable quotes from recent earnings call transcripts to gain insights into how industry leaders are navigating current challenges and positioning themselves for the future in an evolving energy landscape.
Buy-sell agreements don’t matter until they do. When written well and understood by all the parties, buy-sell agreements can minimize headaches when a company hits one of life’s inevitable potholes. But far too many are written poorly and/or misunderstood. Directors are always eager to discuss best practices for buy-sell agreements. In this week’s post, we talk to Chris Mercer, Mercer Capital’s founder and author of four books on buy-sell agreements, and ask, “Is there a ticking time bomb lurking in your business?”
This year’s National Association of Royalty Owners (NARO) National Convention was held in Houston and Mercer Capital’s Bryce Erickson, ASA, MRICS and David Smith, CFA, ASA had the privilege of attending. NARO has represented the interests of oil and gas royalty owners for over 40 years, seeking to support, advocate and educate for the empowerment of mineral and royalty owners. In addition to offering beneficial education opportunities, the event served as a valuable networking opportunity, connecting mineral and royalty owners with fellow owners as well as professional service providers specific to these assets. In this week’s post, we recap the event and provide valuable educational resources for our readers.
