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Energy Insight Series

Transforming for the future of energy

In order to not just survive, but thrive, oil and gas companies and their executives must look around every corner, into the distance, to forecast the industry’s next frontier. There are many weak signals – that if they gain velocity – could have major implications on the industry. But, what happens when companies are too busy managing the current environment, especially in today’s lower-for-longer landscape, to focus on the horizon? And, how can companies prepare for those weak signals with an eye on the present and toward the future?

Energy Insight Session 2017

Mark your calendar now for 18 October 2017 to join us at the 10th anniversary of the Energy Insight Session event. Industry experts will share insights on the future of energy and where the market is headed.

To receive updates on Energy Insight Session 2017 and other energy insights, please click here to be added to the mailing list.

Contact a member of our US Oil & Gas team.

Energy Insight Session
2016 Recap

  • A new era of stability

    Through hard work, innovation and ingenuity, the oil and gas industry in the US has created a global energy powerhouse. Together with Canada and Mexico, the US is ushering in a new era of energy abundance that will enhance supply/price stability for the global market.

    Now, after weathering a difficult price environment, the industry is more nimble and efficient than ever and is poised to begin a new growth cycle – driven by technology and further developments in time - and money-saving process improvements.

  • The future of energy isn’t western-centric

    The North American oil and gas powerhouse: transforming for success North America and Europe won’t drive future energy demand — those are mature markets where increasing efficiency is keeping energy usage relatively flat.

    However, roughly 80% of the world’s population lives in non-developed countries, and that is where the majority of demand growth will occur, driven by further increases in population and rapid modernization.

    The US — along with Canada and Mexico — will play a major role in helping meet that demand for years to come. Stable political and regulatory regimes allow domestic companies to produce as needed without the frequent interruptions from conflict or social upheaval that often plague other parts of the world.

    Despite the growth in renewables, traditional hydrocarbons will still supply 70% of the world’s energy needs in the year 2035. So North America’s contributions to global energy markets are critical for the foreseeable future.

  • Production, exports to rise

    The Energy Information Administration says that both domestic crude and natural gas production — which dipped in response to lower prices — will once again increase by the second half of 2017. As production ramps up, exports of both crude and LNG will increase.

    In addition to rising rig counts in some key producing areas, there are a large number of drilled uncompleted wells across the US that can be brought online relatively quickly to meet rising export demands.

    Eventually, however, the lack of capital investment that has occurred in recent years — especially in major conventional projects — could begin to hamper global supply if demand rises quickly by 2018–2020.

  • Efficiency is the new watchword

    Companies facing a lower-than-longer price environment are succeeding by reducing costs and improving capital efficiency to produce more barrels per dollar spent.

    One way companies are doing that is by increasing their focus on the geological study of potential producing fields, gaining a more complete understanding of what is happening under the surface before drilling in order to maximize production. New techniques in enhanced oil recovery processes are also playing a major role in older fields.

    Disruption has already occurred in the oil and gas industry, but technology is the enabler to overcome disruption. New technology and new drilling processes are allowing operators to increase output from unconventional wells while limiting the number of rigs that are needed.

  • Midstream needs will grow

    Growth in domestic production will require significant new infrastructure to make sure that supplies of crude and natural gas can reach processing or shipment facilities.

    The environmental backlash against pipelines is one challenge that midstream companies will have to overcome. Increased use of rail for crude shipments is almost a certainty in the near future, and many railroad companies have made substantial improvements in technology and training to make sure that crude can be shipped safely.

    Rail also provides flexibility benefits which increase options for producers, allowing shipments to be sent to different refiners or markets as needed quickly and easily. Rail is also better equipped to handle the flush production that occurs in the first few weeks or months of wells coming online.

  • Industry deserves credit

    The tremendous growth in domestic natural gas production — and the use of abundant, low-cost gas to fuel power generation — has been the primary driver behind the country’s dramatic reduction in greenhouse gas emissions, which last year, reached their lowest levels since 1988. The industry continues to pioneer new ways to reduce its own emissions while delivering clean-burning, affordable natural gas that is making a difference in the environmental performance of many industries.

  • Water issues are challenging

    To overcome environmental concerns, oil and gas producers need to continue working to reduce the amount of water used in hydraulic fracturing, and to properly dispose of or reuse produced water.

    Water usage and disposal issues are quickly coming to the forefront of public and regulatory scrutiny and companies should be investing in technological solutions. Industry leaders should be prepared to communicate their plans and successes as needed.

    Some companies today are working with regulators and legislators to change the way produced water is classified, so that it can be viewed as a resource when cleaned up rather than a waste product.

    Other companies are utilizing innovative ways of obtaining water supplies; for example, using municipal wastewater for fracking.

  • Industry still needs to educate public

    The general public lacks energy literacy and special interest groups have taken advantage of that fact to paint the industry in a negative light.

    The technical challenge of explaining how oil and natural gas benefit society must be overcome by frequent, relevant communication and by showcasing the positive impacts to individuals through easily understood examples such as economic development and enhancements to critical lifestyle factors such as education, health care, safety and travel.