Oil & Gas Financial Journal provides financial decision makers with accessible and essential business intelligence regarding worldwide oilandgas markets. Our mission is to provide petroleum industry managers, analysts and investors credible, useful information about the most important financial developments of their business.
For the first time in several decades, the energy insurance market cycle has not tracked with a depressed energy market. This year, 2017, will be seen as the year insurance savings came to a grinding halt.
Oil and gas production has been on the rise in the Wolfcamp formation of the Permian Basin in recent years, attributable to efficient horizontal drilling and a low cost per barrel, particularly in the Delaware Basin. However, reserve forecast and replacement is an ongoing challenge for oil and gas operators.
The past couple of years have seen a shift from concerns that oil supply would soon peak to a recognition of the potential for oil demand to peak and decline, which would have a significant impact on the value of oil companies' equities, comparing it to the sharp downdraft in US coal company stocks. Unfortunately, there remain some serious questions and uncertainties that will be addressed in this article.
Reserve engineers and financial analysts do not always speak the same language. However, engineers for exploration and production (E&P) companies provide a great foundation for drafting a corporate budget, but you have to know how to use it.
Technology has played a huge role in the rapid rise of production in the Permian Basin. Operators are bullish on the region's long-term potential and poised to exploit the Permian at an unparalleled pace over the next few years. However, according to a report by Wood Mackenzie, geological constraints that may arise as the play is aggressively developed could lead to production shortfalls, and in turn, higher prices early in the next decade.