April 2019 Commerce Club featuring Dr. Helen Currie, chief economist, ConocoPhillips
Dr. Helen Currie, Chief Economist at ConocoPhillips, was the guest speaker at the Port Bureau’s April 11, 2019, Commerce Club luncheon. Dr. Currie presented a bright outlook for U.S. oil and gas production hinging on policies that enable trade and the infrastructure to support exports.
ConocoPhillips is the largest independent exploration and production company in the world, operating in 16 countries with 5.3 billion BOE (barrel of oil equivalent) proved reserves at the end of 2018 and more than 4 billion BOE of resources located in the Eagle Ford and Permian.“We at ConocoPhillips see a lot of…runway still ahead of us for growth both in gas and oil in the U.S. and Canada,” said Dr. Currie. She noted that shale gas is entering its second decade of production, and innovation and technological improvements are still being made. Dr. Currie also discussed the role that data analytics and digitization play in increased well production. “The hundreds of thousands of wells that we’ve drilled in the shale gas and tight oil plays in the United States has given us this vast, very rich sets of databases that we can analyze that helps us to make that next well better,” she said. “More importantly….it enables us to try to make that next well better in the North Sea, Argentina, Malaysia, or any other country around the world.”
Digitization and information technology advancements have created opportunities to form partnerships with technology companies to bring that expertise into the oil and gas sector. For example, ConocoPhillips has partnered with Google and Microsoft to analyze well data from Eagle Ford to discover ways to control costs, produce more efficiently, and bring more value to their shareholders.
Dr. Currie touched on ConocoPhillips’ forecasts for global and U.S. oil production, North American shale gas production, and U.S. exports for oil and natural gas. The U.S. is expected to lead net growth of global oil production through 2030. ConocoPhillips forecasts non-OPEC non-U.S. output to be stable, contrary to many analysts’ positions this segment will see a decline due to decreasing investment. Dr. Currie argued that technology allow for increased production for the same investment, and the learnings gained in the U.S. will be applied globally. In Eagle Ford, one rig today adds 1,200% more production than it did in 2010.
Eighty percent of North American gas production comes from shale gas, and shale gas’ importance has been understood for over a decade. However, the surge in domestic oil production has led to related gas production, which Dr. Currie showed is an increasing percentage of natural gas production.
For both crude and natural gas production in the U.S., the ability to export is paramount. Asia is currently one of the largest foreign destinations of U.S. crude and LNG, and that demand is expected to continue to grow. For crude oil, the ports in the Gulf of Mexico have the bulk of U.S. export capacity, and future Gulf of Mexico capacity will be largely driven by the ports of Houston and Corpus Christi. Dr. Currie predicted that the improvements U.S. should see year over year record crude exports for at least the next five years, and much of that will be leaving from Texas.
Dr. Currie emphasized that the ability to engage in global trade is critical for the U.S. to see this bright outlook come to fruition: “There needs to be a lot of infrastructure put in place to enable this trade and government policies that are supportive of the business all the way from the wellhead to the consumer.”
- Date June 3, 2019
- Tags 2019 May