Chapter 1708： Other oil fields are miserable

"The land they bought by Lao Tan is an abandoned oil field. It originally belonged to Anadarko Petroleum Company. At first, it only cost 5 million U.S. dollars. But I don’t know what happened. I added it to 10 million. The drilling equipment was sold to Lao Tan at a low price, and finally sold for 12 million."

Yang Orange nodded, "Let's let Uncle Tan give me an authorization first. I will let people go to explore the situation and rest assured that I will not start large-scale exploration activities before the transfer of property rights."

Qiu Ying didn't understand this. When she heard that there was hope, she was eager to trade quickly, "Okay, I will let Lao Tan prove it when I go back."

After breakfast, Yang Cheng returned to the company and contacted Abramovich and Conrad as soon as possible, asking them to come to New York to meet as quickly as possible. Some things were unclear on the phone.

Conrad was in Australia recently and didn't know what he was busy with. After receiving Yang Cheng's call, he was a little reluctant, "What can't you say on the phone?"

Yang Cheng snorted coldly, "If you don't come back, the tens of billions of business will have nothing to do with you~"

I still don't believe that this stuff can't be cured, and I'm always pretending to be a big-tailed wolf with a high level of generation, and I owe it to clean up.

Sure enough, I heard it was a tens of billions of dollars in business, but I didn't say anything directly, "I will let the crew prepare~"

Compared to Conrad, Abu was much more happy. He was on a business visit in Israel and told Yang Cheng directly after receiving the call-tomorrow!

After the phone call, Yang Cheng asked Susu to call Ryze up.

"Tell me about the situation in the Permian Basin~"

Although Ritz is not prepared, the oil trend is an area he must pay attention to in his daily life. He knows a lot about the hot shale oil that has been speculated in recent years, so he opened his mouth and said, "Shale oil will affect crude oil prices in the next few years. The key factor of the trend, the Permian Basin is also the decisive factor affecting shale oil production.

Therefore, only a deep understanding of the Permian Basin can we have a clear judgment on the future trend of crude oil prices. Sitting in our New York office, we can only understand one-sidedly. "

Yang Cheng said, "It's okay, let's talk about it first~"

"From a cost point of view, shale oil is unique, because densely distributed oil-producing layers, complete infrastructure, superior geographic location, and developed oil and gas services have contributed to the Permian Basin becoming the lowest-cost core production area for shale oil. The average break-even WTI oil price is below US$45, and even below US$40 in some regions.

In terms of development potential, the Permian Basin is still in the middle and early stages of development, with abundant remaining economic wells at an oil price of US$50.

Analysts in the energy field of Wall Street Research predict that by 2018, the annual average production of the Permian Basin is expected to reach 2.9 million barrels per day, accounting for 30% of U.S. production, helping North American crude oil production to hit a record high;

In the medium term, the Permian will restrict the sharp rise in oil prices, and through flexible production increases, the line of sight of oil prices will be controlled. In the next two to three years, without special geopolitical events, the Permian Basin will control the main fluctuations in crude oil prices. The range is suppressed between 45-65 US dollars. "

This is similar to what Yang Cheng understands~

Ritz added, “The three core shale oil producing areas in North America are the Permian Basin, EagleFord and Beacon. Regardless of production or rig volume, only the Permian can maintain stable and continuous growth. EagleFord and Beacon are both In a downward curve."

Yang Cheng couldn't help but frowned, "Hasn't Becon always been hot?"

Ryze shook his head, "The specific situation is unclear. EagleFord, which belongs to Texas in the Permian, has a similar situation. Only the Permian bucked the trend, which is really incredible.

According to the data I got, the Permian has been increasing production since 2007. Before the oil price plummeted in 2014, his output was 1.6 million barrels per day. In February of this year, when the oil price was lowest, the output was close to 2 million barrels per day, and continued to increase production. in;

EagleFord's production in mid-2014 was 1.4 million barrels/day, which peaked at more than 1.7 million barrels/day in March 2015. Since then, production has continued to decrease, and has now fallen to 1.1 million barrels/day;

The same is true for Bacon. The output in mid-2014 was 1.05 million barrels/day, which reached a peak of 1.25 million barrels/day in the middle of last year, and then continued to decrease, until now it has fallen below the million mark! "

Susu came in to deliver coffee, just speaking of thirsty, Ritz took a sip, it was a bit hot, and then said, "In addition, in terms of the number of rigs, the overall peak in the number of rigs in the United States was nearly 2000 in 2014, and the trough is this year 400 units in May.

The peak value of the Permian was 560 units in 2014, and the valley value was 130 units in 2015, and then slowly recovered to close to 200 units;

EagleFord now has less than 70 units, and Bacon is even worse, with less than 50 units. "

Yang Cheng was always puzzled, "It is understandable that the Bakken production is relatively small, but EgleFord is clearly in the Permian reservoir. Why is the decline so obvious?"

EagleFord is located in southern Texas. Compared with the Permian in western Texas, the gap between the two large oil fields is not one and a half minutes. Is EagleFord out of oil?

This is obviously impossible. Since the day the EagleFord shale was discovered, it has been recognized as a world-class oil and gas province. The EagleFord shale has the potential to eventually become a single oil-rich and high-yield formation in the United States. How could it be out of oil? .

Ryze thought for a few seconds and said, "I think the most important and obvious reason for this different situation is the economic aspect.

The Permian Basin benefits from the existence of multiple sets of potential oil-bearing layers. For example, different horizontal strata underground have commercial oil and gas production capacity. In many places, a single well is not a shale oil producing layer, but often For several oil and gas producing zones, it is obvious that multiple sets of producing zones can be produced by drilling one well, which greatly reduces the total unit production cost.

The EagleFord Shale itself is a huge oil and gas-rich formation, but in this production area that has been producing for many years, there is currently only one layer in a well for production.

Due to this difference, the average expected break-even oil price in the Permian Basin is significantly lower than that in the EagleFord area.

In many parts of the Permian Basin, oil and gas producers have a break-even point of US$30/barrel or even lower, while the current break-even point commonly found in EagleFord is about US$50 per barrel at current oil prices Look, this price is obviously a loss.

Capital investment in the oil and gas industry always flows to the place with the highest rate of return. This is the law!

The Permian has always produced oil and gas, that is, producing profits. Naturally, investors will not guard a high-cost oil field. "

Yang Cheng sighed, "What you said is right, so do you think we have time to invest in the Permian now?"

Ryze didn't answer directly, but instead asked, "Boss, do you have a goal?"

Yang Cheng hesitated and told Lao Tan's affairs.

Regarding this, Ryze’s reaction was very direct, “It’s worth a gamble. The abundant underground oil and gas reserves in the Permian Basin are worth the risk. We take a 10,000 step back and say that even if we lose, we can afford to lose. If the bet is won, the profit is comparable to reselling arms!"

This idea coincides with Yang Cheng~

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