U.S.
Australia
15
By Andy Hogan
Permian oil production is expected to rise in all three scenarios—little-changed policies; no new federal leasing but existing leaseholders continue receiving drilling permits; and the most extreme scenario, in which no new federal permits or extensions are granted starting in 2023, when the most-recently issued permits will expire. With little-changed policies, Permian Basin oil production is set to grow from 4.3 million bpd today to 5.3 million bpd in December 2025. New Mexico’s production will increase from 1.0 million bpd to 1.5 million bpd, according to Dallas Fed’s economists. In the hybrid case assuming no new federal leasing, but existing leaseholders continue receiving drilling permits, Permian production would rise to 5.1 million bpd in 2025, and New Mexico’s oil output would rise only slightly to 1.1 million bpd. In the restrictive-case scenario, however, in which no new federal permits or extensions are granted starting in 2023, Permian production still rises to 4.8 million bpd in 2025, but New Mexico’s output drops to 700,000 bpd, as many areas of the Permian in New Mexico are on federal lands. “Half of New Mexico’s production comes from federal acreage in the Permian Basin, and the anticipated actions would slow economic growth, adversely affecting that state’s employment and tax collections,” the Dallas Fed said. The analysis focused on the Permian, but the economists expect production from other basins to also drop compared to business-as-usual forecasts. In Wyoming, for example, the federal lease moratorium will impact 75% of the state’s conventional fields and 60% of drillable land, the University of Wyoming’s Enhanced Oil Recovery Institute (EORI) said in a report in early March. “This policy will restrict, or possibly prevent, access to 2.9 billion barrels of potentially recoverable oil reserves on federal lands and the associated $12.9 billion in tax revenue,” the report says. This year is already shaping up as a crucial year for the US oil and gas industry. It will show how well – financially and production-wise – US operators have handled the worst price crash in decades, and how much future federal leasing policies would impact the sector.
“The View from Down Under” Preparations continue for a small ramp up in offshore activity across Australasia. The Maersk Deliverer semi sub is believed to have resumed operations for Inpex on the Ichthys Phase 2 campaign after a delay due to an incident on the rig, OMV NZ continue to drill using an Archer rig on the Maui A platform in the Taranaki Basin, still in New Zealand the outcome of OMVs’ tender for a large jackup for a drilling campaign on the Maui B platform over 2022 is expected imminently. Beach Energy spudded the Artisan-1 exploration well in the Otway Basin, offshore Western Victoria at the very end of February, this is the first of 6 firm and 3 optional wells in the area using the Diamond Ocean Onyx semi. The campaign got off to a good start when Beach announced at the end of March that the Artisan-1 well had encountered hydrocarbons. Preparations are underway by Santos to use the Noble Tom Prosser Jackup to drill 3 x 90day infill wells on the Bayu Undan field in the Timor Sea, it has also been announced that the rig will be used to drill 3 exploration wells off the NW coast after Bayu Undan. Santos is also preparing to bring the Valaris MS-1 semi sub back to Australia to drill three infill wells on the Van Gogh field off the NW coast. The rig, formerly known as the Atwood Osprey, has only ever worked in Australia, commencing it’s maiden contract for Chevron in 2011 before being stacked in Labuan since 2018. The Van Gogh work is expected to keep the rig busy for 5 to 6 months. The rig is believed to be a leading candidate for the 300-day Woodside Enfield P&A campaign due to start at the end of the year.
SapuraOMV will be taking the Valaris 107 jackup to drill the Eagle exploration well off the NW coast, Jadestone Energy will then take the rig for drilling and intervention work on the Montara field, both of these programmes were due to take place in 2020 and were delayed due to the combination of COVID and low oil price. The Ocean Apex semi sub has been stacked off Rottnest Island just off Perth for the last few weeks, it is due to mobilise for Woodside around May to for a 3 well campaign on Great Western Flank and the Lambert deep well which will keep it working to into early 2022. ENI are still evaluating tender responses for an intervention vessel for the Woollybutt P&A and the NZ Government will be issuing an RFP for a vessel or rig to P&A the Tui field, both of these campaigns are planned to take place over the Southern Hemisphere summer. The Umuroa FPSO and most of the seafloor infrastructure at Tui is due to be removed by the middle of this year. The Northern Endeavour Task Force have yet to issue enquiries / tenders for the decommissioning of the Corallina / Laminaria fields, the FPSO continues to be maintained in ‘Lighthouse Mode’ by UPS on behalf of the NETF.
“The View from Down Under” is brought to you by: Networked Energy Consulting Pty Ltd, based in Perth, WA, Australia
