Industry leaders paint picture of transforming energy landscape

The rush to acquire assets in various North American unconventional resource plays is over and the oil and gas industry is shifting gears. Transforming the Energy Landscape is the theme of this year’s NAPE Business Conference, a one-day event to kick off Summer NAPE in Houston. Marty Schardt, executive vice president of the American Association of Professional Landmen (AAPL) and general partner of the NAPE Business Conference, welcomed conference attendees and kicked off the event with industry thought leaders painting a picture of the transforming energy landscape.

The unconventional revolution—a phrase he says the industry is trying to diminish as the unconventional becomes conventional—is entering a new phase as the land grab is coming to a close. Operators are turning their focus to harvesting their undeveloped plays and returning cash.

Since the surge in North American production from shale and tight oil took off in 2008, US oil production has increased by 1.5 million barrels per day — the highest growth in oil output for any country in the world in the same time period. And the growth is expected to continue. IHS predictions put North American tight oil production within reach of 5 MMb/d of oil and condensate and another 5.5 MMbd of natural gas liquids before 2020.

The implications for the petroleum industry and the US economy are tremendous.   

In his keynote address to the conference Wednesday, Pete Stark, senior research director and advisor at IHS CERA, outlined the major impact the surge in North American production from unconventional resources has had on the US economy. In what he called the “Shale gale natural gas game changer scorecard,” Stark noted US GDP in 2012 of $122 billion with the potential to reach $287 billion by 2035,” creating “competitive advantages for the US economy.”

Asset transaction activity remains healthy across the supply chain, energy technology and service sectors continue to grow, and midstream and downstream infrastructure continues to expand to help fill the need related to the new oil and gas supplies. 

Roughly 9,500 miles of new pipelines are in various stages of planning and development and some 12,000 miles of pipeline are expected to be recommissioned to help meet the growing demand.

Stark pointed to new markets emerging, specifically mentioning the boost in rail as a factor in the transportation of resources, noting the 400,000 b/d expected to move by rail by 2015.

Matthew Rose, chairman and CEO at BNSF Railway Co. and the keynote lunch speaker at Wednesday’s conference, spoke about the rise of shipments of petroleum products via rail that has occurred since 2009. In 2012, US Class I railroads originated 256% more carloads of crude oil than the previous year, he said, noting what he called “unique value” in rail as market distribution flexibility allows producers to ship in multiple constructs and to refineries throughout the US. Rail is here for the long haul, he said, pointing out that the industry is placing a continuous focus on improving safety, reaches more markets than the alternatives, and provides a faster time-to-market.

The potential positive impacts on the US economy in terms of job creation and the revitalization of energy dependent industries are tremendous. As the industry moves into this new phase, community concerns, logistical challenges, and matters of policy must all be addressed as companies strive to strike a balance to effectively realize the potential of undeveloped plays, all the while minimizing costs. The presentations paint a picture of an industry in transition, but one with opportunities even greater than thought possible just a few short years ago.


Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now


Logistics Risk Management in the Transformer Industry

Transformers often are shipped thousands of miles, involving multiple handoffs,and more than a do...

Secrets of Barco UniSee Mount Revealed

Last year Barco introduced UniSee, a revolutionary large-scale visualization platform designed to...

The Time is Right for Optimum Reliability: Capital-Intensive Industries and Asset Performance Management

Imagine a plant that is no longer at risk of a random shutdown. Imagine not worrying about losing...

Going Digital: The New Normal in Oil & Gas

In this whitepaper you will learn how Keystone Engineering, ONGC, and Saipem are using software t...