199 episodes

Computer generated audio of the latest Daily Energy Post Blog Articles.

RBN Energy Blogcast RBN Energy

    • Business
    • 5.0, 5 Ratings

Computer generated audio of the latest Daily Energy Post Blog Articles.

    Born to Flow, Part 2 - Cheniere's Midship Shuffles Gas Flows East From SCOOP/STACK Plays

    Born to Flow, Part 2 - Cheniere's Midship Shuffles Gas Flows East From SCOOP/STACK Plays

    In the nearly three months since it began initial service, natural gas flows on Cheniere Energy’s Midship Pipeline out of the SCOOP/STACK have ramped up, and now consistently top 700 MMcf/d. This, despite production from the Oklahoma basins declining by close to 10% in that time. In other words, Midship is doing what it was supposed to do — namely, giving producers and shippers incremental capacity to reach relatively more attractively priced markets. However, the pipeline was also meant to connect that supply region with growing LNG export demand on the Gulf Coast, which has been slashed in recent months as global oversupply and poor economics have marginalized U.S. LNG cargoes. That raises the question, where are Midship flows heading? Today, we provide an update on Midship gas flows.

    • 12 min
    Cruel Summer? - Is the Crude Market Headed for an Ugly Replay of This Spring?

    Cruel Summer? - Is the Crude Market Headed for an Ugly Replay of This Spring?

    The crude oil market may be approaching another rough patch, with the trajectory of the COVID pandemic and OPEC+ again poised to inflict a double whammy on U.S. producers. For the past couple of months, refinery demand for crude has been rebounding as the U.S. has made tentative steps toward reopening. Over the same period, domestic production of oil declined and then flattened out, and now appears to be headed for a midsummer uptick as more shut-in wells are brought back online. But there’s potential trouble just ahead. The months-long imbalance between crude supply and demand boosted U.S. oil inventories in commercial storage to record-high levels over the past few weeks, with even more oil flowing into rented space in the Strategic Petroleum Reserve (SPR) salt caverns. Worse yet for producers, a resurgence of the coronavirus may put some parts of the U.S. back into semi-lockdown, and if that happens, refinery utilization could take a second tumble. That could push more crude into storage or onto supertankers for export, even as OPEC+ is talking about relaxing their production cuts. Today, we examine the trends that could be problematic for U.S. oil producers and refiners in the second half of 2020 and beyond.

    • 13 min
    Undone - U.S. LNG Export Demand Unravels

    Undone - U.S. LNG Export Demand Unravels

    U.S. LNG exports in recent months have gone from providing a consistent and growing source of demand to balance the U.S. natural gas market to now being a drag on demand growth and the gas market balance. Rising storage surpluses and record low prices in Europe and Asia, along with relative strength in the U.S. national benchmark prices at Henry Hub, have turned the economics upside down for U.S. exports and led to widespread cancellations of contracted cargoes. Feedgas deliveries and cargo liftings at Lower-48 terminals both have plummeted to the lowest levels since early 2019, despite domestic liquefaction capacity climbing by more than 4 Bcf/d since then. Moreover, the dynamics that led to the current predicament are likely to persist at least through injection season and potentially even beyond that to a certain extent. Today, we provide an update on how cargo cancellations have affected U.S. gas demand for exports, overall and at individual terminals.

    • 15 min
    Dream On - The Challenges Posed by Shutting Down the Dakota Access Crude Pipeline

    Dream On - The Challenges Posed by Shutting Down the Dakota Access Crude Pipeline

    A federal judge’s order that the 570-Mb/d Dakota Access Pipeline be taken out of service for a year or more starting August 5 has the potential to wreak more havoc for producers in the Bakken Shale at a time when they are still reeling from drastic, COVID-related production curtailments. While those production cuts have opened up at least some capacity on other takeaway pipelines out of western North Dakota and crude-by-rail terminals may be able to ramp up their operations, that may not be enough to make up for the loss of DAPL — still more well shut-ins may be required. Then there’s the matter of taking the 1,172-mile, 30-inch-diameter pipeline offline in only four weeks’ time — it involves much more than flipping a switch and may not even be possible within that time frame. Today, we consider the hurdles and implications of removing DAPL from service.

    • 10 min
    He Ain't Heavy, He's My (Diluent), Part 4 - Assessing Future Demand and Sources of Diluent

    He Ain't Heavy, He's My (Diluent), Part 4 - Assessing Future Demand and Sources of Diluent

    So far, 2020 has been another bad year for bitumen producers in Alberta’s oil sands. For the second year in a row, they have been forced to endure production curtailments, this time in response to COVID impacts on demand and the resulting record-low heavy oil prices. Still, there are at least glimmers of hope that the bitumen market will soon enter at least a modest recovery mode, and that further gains will be possible in 2021 and beyond. Moving all of that bitumen to market in pipelines and in rail cars is going to require even more diluent than the record amounts already consumed in late 2019 and early 2020. Today, we consider the outlook for bitumen production, what that outlook means for future diluent demand, and if that demand can — or cannot — be met by the various sources of diluent supply.

    • 12 min
    Green Grow the (Refineries) - Low-Carbon Programs Spur More Renewable Diesel

    Green Grow the (Refineries) - Low-Carbon Programs Spur More Renewable Diesel

    They’re generally small in size, but renewable diesel refineries are popping up in many parts of the U.S., incentivized by government programs aimed at reducing carbon emissions and very gradually weaning Americans — and Canadians — from crude oil-based diesel fuel. Recently, HollyFrontier Corp. announced that it will be converting its decades-old Cheyenne, WY, refinery into a renewable diesel facility. While the news of another entrant into the renewable diesel market is not surprising, the complete shutdown and transformation of an existing refinery for this purpose marks only the second time this has occurred in the U.S. Today, we discuss HollyFrontier’s plans and provide an update on renewable diesel supply and demand dynamics.

    • 10 min

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