Shale Oil

Major producers in the Permian Basin shale play, including Chevron Corp., ExxonMobil Corp., and Pioneer Natural Resources Co., have all announced plans to boost oil output from their assets in the play over H2 amid increasing oil demand and prices.

Bloomberg New Energy Finance (BloombergNEF) surveyed 50 shale drillers, and they are expected to post losses of almost $12.0B this year due to hedging activity that is now proving to be a poor decision considering the ongoing recovery in oil demand and prices.

As Canada commits to attaining net-zero GHG emissions by 2050, upstream and downstream firms as well as midstream operators have been working on their compliance plans.

According to the Norwegian consultancy, US oil production will average 11.51MM b/d this month, up 60K b/d from June output, and will remain at that level through Aug.

Devon Energy Inc. has become the second US oil firm after Occidental Petroleum Corp. to announce a target of achieving a 50% reduction in Scope 1, which come directly from operations, and Scope 2, which come from purchased power, GHG emissions by 2030 on the way to net-zero Scope 1 and 2 emissions by 2050.

The Dutch commodities trading firm has partnered with Latin American independent Vista Oil & Gas in a $250MM integrated drilling project in Argentina's Vaca Muerta shale formation for the development of 20 wells in Vista's Bajada del Palo Oeste concession, where Vista currently operates 28 drills with production of about 24K b/d.

With oil prices continuing to rise amid growing demand and continued supply restraint from OPEC+, US shale producers are seeing a significant uptick in free cash flow, which is resulting in these firms beginning to boost spending.

The global oil-price collapse in 2015 had taken down shale plays before a price recovery emerged in 2018, spurring the return of production from the plays.

According to IHS Markit data compiled by the Institute for Energy Economics and Financial Analysis (IEEFA), ExxonMobil Corp.'s production per well in its Delaware Basin acreage fell from an average of 635 b/d in 2018 to 521 b/d in 2019, the last full year with available data.

S&P Global Platts Analytics reports that over $31.1B in merger and acquisition (M&A) activity has been agreed upon in the US shale industry so far this year, compared to $4.1.1B in M&A activity for the entirety of 2020.