Wednesday 22 February 2012

Global Energy Fundamental Facts: Something Borrowed, Something Knew

Global Energy Fundamental Facts: Something Borrowed, Something Knew

Matt Smith is a Commodity Analyst for Summit Energy International. A subsidiary of Schneider-Electric. Find Matt's Energy Risk Management blog at

Speaking at a conference has a number of benefits; it makes you research the pants off the topic you are speaking about, you get to meet random yet fascinating people, and you get to hear about topics that are not necessarily directly relevant, but interesting. So reviewing my notes from last week's AMM conference I thought it would be useful to share some of the random facts I was presented with, and that I presented. So henceforth here is a collection of something borrowed, and something knew:


Apparently, the longest horizontal drilling rig in the world is 12,345 meters long (Yep, 12.3km)

China produces over 50% of the world's steel

There is estimated to be five times the amount of unconventional hydrocarbon reserves in the world versus traditional deposits

The average age of a truck driver in the US is 46 years old, with the average wage being $40k

There are 45 LNG stations in the US as of October 2011, with 70 expected to come online in 2012 at Pilot Flying J centers, with Clean Energy Fuels Corp committing to build 150 more

Horizontal drilling is expected to double in Russia in the next 5 years

LNG is only a viable option for long-haul trucks. CNG is only useful for short journeys, such as garbage trucks and mail deliveries

96% of drilling in the Bakken shale is done by horizontal rigs

Bakken has 350 wells drilled each quarter which are not fracked, due to the shortfall in equipment available


Oil production in North Dakota has surpassed that of Opec member Ecuador, and is set to become the second largest oil producing state in the US this year, surpassing Alaska and California

EIA states that US oil imports in 2005 = 60% of total consumption, US oil imports in 2010 = 49%, US oil imports In 2035 = 36%

Bentek states over the next five years the US will see 75 oil pipeline expansions, 25 railroad expansions, and 7 refinery expansions

The new kids on the block in terms of shale plays over the next five years taking over from Bakken, Marcellus, and Eagle Ford include Utica in Ohio, Niobrara in Colorado, and Monterey in California

The EIA slashed their estimate for Marcellus gas shale reserves in their latest 2012 outlook, from 410 Tcf to 141 Tcf

This led to a huge write-down in total US gas shale reserves from 827 Tcf in last year's report to 482 Tcf in 2012

According to Reuters / EIA, China is one of the largest holders of gas shale reserves at 1,275 Tcf

According to research by IHS CERA, 600k jobs have been created by shale in the US, with that set to reach 870k in 2015. This number is set to nearly double to 1.6mln by 2035

The EIA is calling for shale to make up 49% of natural gas supply by 2035. IHS CERA is calling for this number to be more like 60%

The EIA expects US oil production to increase by 1.2mbd from 5.5mbpd in 2010 to 6.7mbpd in 2020. Bentek is somewhat more bullish, calling for an additional 2.2mbpd by 2016

So that's my collection of garnered and gathered info-nuggets. Please feel free to fire through any questions you may have. 'Til next timeā€¦rock on!

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