Watch Dr. Fine’s presentation here in ENERGY MARKETS OUTLOOK-> https://youtu.be/Mo4qjIJTZEc
Energy Markets Outlook : The Geopolitics of the war with Russia and China
With T. Greg Merrion
Dr. Dan Fine
John Byrom
Dr. Dan Fine, distinguished energy scholar, Harvard University Fellow and MIT graduate, T. Greg Merrion, Chairman of Merrion Oil and Gas and John Byrom, PESCO Business Development Manager, will be presenters at an Energy Markets Briefing on Tuesday, June 21 at the Henderson Fine Arts Center on the campus of San Juan College. The briefing will run from 10:00 to noon. Panelists will be moderated by Arvin Trujillo, 4CED CEO.
It’s not news to anyone recently filling up their truck or car that something’s up in the energy market and (hint) it’s not supply. Natural gas prices are up substantially as well from recent record lows and it’s not even winter.
Dr. Fine will share his thoughts about the war in the Ukraine and how it may affect the U.S. and possibly the San Juan Basin as European countries, especially Germany, look for natural gas and oil resources for their energy needs. Although the war in Ukraine is a regional conflict, Dr. Fine believes it could escalate to a more global war if not careful.
Dr. Fine will also share his concerns about the conflict beginning to materialize in Southeast Asia between taiwan and China. John Byrom will share insights into the emerging hydrogen markets and about PESCO’s manufacturing capabilities. T. Greg Merrion will offer insights into San Juan Basin natural gas and oil reserves and what we should do to prepare. For more information call (505) 566-3720.
Four Corners Economic Development or email info@4cornersed.com
Last week 4CED hosted energy thought leader Dr. Dan Fine who spoke on the topic of the future energy outlook under the Biden administration and implications for San Juan County. If you missed it, the meeting was recorded and is posted to the 4CED website.
Watch it here-> https://www.screencast.com/t/ge0EUXjjgqPa
Dr. Daniel Fine & T. Greg Merrion on oil price war, opec, natural gas, next steps?
The Full article in the Farmington Daily Times Energy Magazine (USA TODAY)
”
With the OPEC-Russia meeting ahead, the price of oil is at a crossroad.
President Trump wants lower prices for gasoline at the pump and the Democratic Party wants a shortage to lift prices higher. This is the 2020 presidential election, to re-elect Trump or a create a Democratic left-center White House.
Is OPEC-Russia ready to sustain output cutbacks for $70 Brent Oil or continue revenue maximum against market share? Curiously, in the conversation at Vienna the Oxy purchase of Anadarko will resonate. Why? Oxy must now increase its export of oil to lower its debt (Warren Buffet and more) and prevent a serious management miscalculation of paying too much for Anadarko.
Permian Delaware shale, with new high volume pipelines completed soon, must find expanding import markets of l.5 million barrels of oil per day or the equivalent of OPEC-Russia resuming late 2016 output for export.
As this writer concludes this column for the The Farmington Daily Times’ Energy Magazine, which Is going on hiatus in San Juan County after this edition, there is no change in an outlook that dates back to the oil price crash of 2014-2016.
There is too much oil (over-supply) against world demand for it.
Exxon-XTO in the Permian is prepared for $40 per barrel, and to still add $82 billion value in the New Mexican Permian or the Delaware in the next 40 years.
However, along with Chevron, Oxy, EOG and Pioneer, it must have a market for the economic recovery of reserves estimated at nearly 47 billion barrels in the Permian Delaware Basin. They must export against OPEC-Russia production.
The lifting cost of Saudi Aramco oil remains lower than Permian Shale. Saudi Aramco has sold debt (bonds) and 63% of its cash flow goes to its government? With oil demand slack and sluggish, and electric vehicles preparing for a 2024 market challenge both technically and politically (zero emissions).
While associated natural gas has partially become a free commodity from Permian Delaware producers, natural gas is up next, after coal, as a target for Green Energy. It should resemble oil on a smaller scale as price dependent entirely on exports in the form of LNG.
Will Persian Gulf, Australian, and Russian natural gas production roll backward in favor of American LNG? American exporters today cannot compete in a $5 per ton Asian LNG market.
Some San Juan Basin producers at the recent San Juan Basin Energy Conference openly discussed shifting capital spending
from natural gas to oil development.
This writer reaffirms his $50 average price for WTI oil in 2019 presented for the smaller independent producers at a briefing at Merrion Oil last December, but beginning early in 2020 forecasts a second half average of $38 per barrel .
In New Mexico, the Governor can adjust the Energy Transition Act basic law next February, but it should be a petroleum-revenue 30 day session without serious oil and gas organized opposition.
New Mexico is now a hybrid Green State with more exportable oil and gas than every OPEC country except Iraq and Saudi Arabia, and yet it will impose the most effective rules for methane capture.
No amount of ad hominem distraction against its policy and leadership will change this direction, and the nation could follow with the outcome of the national election next year.
Daniel Fine is the associate director of New Mexico Tech’s Center for Energy Policy. The opinions expressed are his own.”
LOGOS RESOURCES LLC
Mar 15, 2019, 09:52 ET
The San Juan Basin Energy Conference was founded to provide a forum for exchange of ideas regarding the development of the abundant energy resources found in the region. The theme of this year’s conference is “Looking to the Future”. A recent influx of dynamic oil and gas operators, bringing innovative applications of modern technology to the Gallup sandstone and the Mancos shale formations, promises to restore the San Juan Basin to its place as one of leading basins in the United States.
Regional producers continue to leverage their experiences to apply industry-best practices in efficient implementation of the recently-surging development. The San Juan Basin Energy Conference 2019, sponsored in part by Hilcorp, Whiptail Midstream, and LOGOS Resources II, LLC brings together the basin’s top companies and industry experts to share views on the industry and discuss plans for the future within the San Juan Basin.
Tickets and sponsorship information are available at sanjuanbasin2019.com. Ticket prices are $250/person and sponsorship prices range from $1,000–$10,000. Net proceeds will go to San Juan College’s research park, Four Corners Innovations, Inc.
FOUR CORNERS INNOVATIONS, INC.
DOLORES SILSETH
(505) 566-3402
SILSETHD@4CII.ORG
SOURCE LOGOS RESOURCES LLC
“Some 30,000 children marched in Belgium weeks ago against Climate Change. It is only a matter of two years before a few members of Congress, alone with only cameras today, will march at the head of crowds of 500,000 down Pennsylvania Avenue.
It will have its colors; green — and yellow for the French — as 2020 arrives.
New Mexico Gov. Michelle Lujan-Grisham placed the state in the march which calls for America to join the Paris Agreement on climate change when she joined the U.S. Climate Alliance. But is it all for Green Energy without technology?
So far there is nothing on the road that eliminates carbon. The Green Deal is loaded: it offers “Green Energy” with diversionary political baggage.
Is it around the corner? It is. In six years, Audi-Porsche-VW will have an electric car on I-25 that will be zero-emissions, cost $27,000 (today’s dollar) with a range that beats Tesla.
Too soon to shake heads negatively. The surprise is a mass electric car with a German engineering in a Ford. Indeed, Ford will no doubt bid for the license is this writer’s forecast.
The revolutionary change is green energy and colorless technology. The kids in Belgium would be getting drivers licenses by then. What happens to I-25 or 550?”
The article by Dr. Daniel Fine is here-> https://www.daily-times.com/story/money/industries/oil-gas/2019/01/27/analysis-things-flat-permian-governor-wants-renewables/2595583002/ The Permian-Delaware Basin rig count should start falling as oil operators, large and small, are flat for 2019.
Spending has been sharply reduced as supply now dominates the A.I. (Artificial Intelligence) used by many commodity traders in oil.
The large or integrated oil companies have all the rigs of 2018 in place for 2019. This would make October the price peak of the latest boom or recovery in oil. Permian-Delaware Basin production would decline at least 500,000 barrels in 2019 to offset the supply glut and stabilize at $50 per barrel.
OPEC members, notably Saudi Arabia, need a fiscal price of oil of $85 per barrel to pay for government and social spending. But at $60 per barrel, cash flow will not make it.
Its new public relations-lobbying in the U.S will require Sovereign Wealth Fund borrowing at market rates, which will be higher mainly because of U.S Senate sanctions over the murder of a Saudi journalist writing for the Washington Post.
This writer forecast a 2019 $50 per barrel average price of oil when prices fell to $43.00 last month.
At the same time, many small and independent producers have break-even at $50 with high-interest debt!
There are Chapter 11 bankruptcies valued at $140 billion from the Panhandle in Texas to the San Juan Basin that resulted from the OPEC -Saudi Arabian price and market share war of 2014-2016 against Southwestern small/independent shale and tight sands producers who now want reparations or damages.
This could hold up financial public relations as state courts hear from local energy banks and their Chapter 11 or equivalent clients.
Saudi Aramco is looking at American LNG investment in the Gulf Coast.
But that would compete against Russian Gazprom export pipeline gas to the European market.
This would confront Russia with Saudi Arabian conflict and threaten Russian-Saudi Arabian accord in OPEC.
Governor Michelle Lujan Grisham of New Mexico has announced a target of 50 percent renewable energy in 10 years. Electricity rate payers would bear the cost. She also placed New Mexico in the Climate Change Treaty Camp. However, if the Democratic Party wins the White House in 2020 there is no doubt that Washington will follow Santa Fe and our new governor.
In the meantime, the new Secretary of Energy Minerals and Natural Resources, Sarah Cottrell Probst, is a world expert in carbon tax architecture to mitigate global warming.
And there could be trade-offs with the super-majors in the Permian-Delaware basins.
The new Administration is expected to create a new energy policy that will replace the effort of ex- Governor Martinez. One issue that did not appear in 2015 was well-density.
The current company-state conflict centers around increased density because of down-spacing in the sub-surface. The opposition is beyond this specific technical capability: it is about more production of oil and carbon in relation to climate change.
What happens in New Mexico will have an impact on regulations in other states and, later, in national energy policy.
This column is an independent analysis by Dr. Daniel Fine, who is the associate director of New Mexico Tech’s Center for Energy Policy and the State of New Mexico Natural Gas Export Coordinator. The opinions expressed are his own.
Geopolitics, Resource WAR 