Fracking 2.0: America has announced a second shale gas revolution

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Гидроразрыв 2.0: Америка объявила о второй сланцевой революции

In America brewing a second shale revolution, proud to write overseas media. Investment “barkers” promise of unprecedented profits for those “who invest in new projects, despite the recent collapse in this market”. Oil analyst Nick Jobe recalls that many people got rich before bursting shale bubble. Then the shares of such companies as Continental, American Oil & Gas and Brigham Exploration have become rich of the lucky ones. However, at the peak of the shale gas revolution.

“Now, fracking is back, and the profit that it creates, even more than the first time,” writes Nick Jobe. According to him, this is due to the new technology described in the American press dubbed “Fracking 2.0”. Judging by the publications, in the USA not only reduced the price of oil, but also learned the second time to collect the hydrocarbons, where seemingly there was nothing left.

In fact, the decline in world oil prices has forced a number of energy companies of the United States to invest in the development of new efficient solutions. In the end, shale oil miners optimized their costs, and now drilled only where “it is scientifically unfounded.” A pioneer in promoting new technologies was the company EOG Resources Inc, which is informally known as Apple oil. Its analysts have developed a software and hardware application iSteer, which can significantly reduce the cost of exploration, drilling and production of oil in shale formations.

Let’s remind, that company EOG Resources Inc has gained wide prominence during the first of the shale revolution, becoming a pioneer in horizontal drilling, and in dense layers of rock that hold oil and gas in tiny pores. Then drillers from EOG Resources Inc first called mad, as the calculations showed the obvious unprofitability of this project, but then geniuses.

And here the engineers EOG Resources Inc has announced new technology that enables profitable work in conditions of low oil prices from $ 40 to $ 50 per barrel. The first publication about the technology of “Fracking 2.0” appeared in March-April of this year, but was not aware of the details.

“We now know that EOG is drilling in West Texas horizontal well length by more than one mile within 20 days compared to 38 days in 2014, writes Nick Jobe. — Recorded record only 101/2 days. Incredible. And most importantly, the price is a quarter cheaper than it was three years ago.” The main effect is achieved by lowering capital costs for exploration and drilling by 25%, thanks to more precise definition of rich layers, which reduces another 15% of spending.

And engineers from Baker Hughes Inc., by the way, reported innovative recovery techniques on older wells, which typically are used only 9-12 months. This allowed Baker Hughes Inc to increase to 46 months of operation the oil layer and to produce on average additional 69% of oil compared to traditional technology. In this case the cost recovery does not exceed $ 1.8 million per unit, or 25% of the price of a new well. They called it a “knockout” capital expenditures.

Another two companies — Chesapeake Energy Corp. and Pioneer Natural Resources Co. said that we have achieved the same results my way. And in addition to the iSteer app there are other innovations designed also to drastically reduce the price of the “slate”. In particular, it became known about experiments with ultra slim wells in the oil Sands, which allow you to get more oil per dollar spent compared to traditional methods.

It is clear that the costs of each well are different, but in General Americans have a reserve to reduce the average cost of production of shale oil by 40% compared to 2014. Or up to $ 35 per barrel, says Nick Jobe. Although three years ago about such figures do not even dreamed of.

Still, it is logical to talk about a second shale revolution, but of evolution, which, incidentally, would not take place without the latest American achievements in materials science, instrumentation and mathematical modeling.

We will remind, in the beginning of 2015 expert Sergey Pikin, Director of energy development Fund, in an interview with “Free Press” and warned that the slate still show themselves. “The Americans have great experience in this matter, — then commented Sergey Pikin. — Remember that the active development of shale oil began in 2009, and gas — even earlier, in 2005. It is clear that during this time they achieved certain results, therefore, it is likely that you have accumulated “know-how”. In addition, those who are engaged in this business are highly motivated. So that we may be witnessing new inventions in this field and new shocks in the oil market”.

Anyway, but according to the calculations of U.S. Department of energy, through innovation, the daily volume of oil production in 2018 will reach 9.7 million barrels, rebounding from the “bottom” of 9.2 million barrels. Thus OPEC, primarily Saudi Arabia, will have to reduce their production in proportion to the growth in the United States to maintain the current prices.

At the same time, these figures indicate a recovery of oil production in America to the level of 2014. The fact that most of the players of the local shale market admitted that the reduction of costs in the framework of the “Fracking 2.0” gives them no hope that the jerk — even basic survival. They need at least $ 55 to $ 60 per barrel, that really began the second shale revolution. The success of companies EOG Resources Inc., Chesapeake Energy Corp., Pioneer Natural Resources Co and Baker Hughes Inc they are associated with specific favourable circumstances. In any case, hope for the return of high oil prices on the world market is no longer necessary.

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