Hess Midstream, which operates oil, gas and water handling assets in North Dakota’s Williston Basin, expects to see volume growth of at least 5% in the second half of 2026, the company said during its Q2 2026 earnings call August 3.
There’s been a frenetic scramble among oil and gas producers through the early 2020s to acquire top-tier acreage and production assets they think they will need to survive and thrive. Some of those acquisitions are still being done through smaller deals such as acreage swaps, but the expansion mode of choice for most has been big-time M&A, which in a single multibillion-dollar deal can add years to a company’s inventory life or perhaps give it a stronger foothold in a key production region or two. In today’s RBN blog, we discuss Devon Energy’s recently announced $5 billion acquisition of Grayson Mill Energy, yet another private-equity-backed E&P cashing in on the smart moves it has been making.
The group of 21 liquids-focused exploration and production companies we have been tracking plans to cut capital expenditures by half in 2016, after a 42% decline in 2015. However, capex for this “oil-weighted” E&P peer group is apparently bottoming out—their mid-year guidance was only 2% lower than their original 2016 estimates. Even with deep cuts in capital spending, the group expects production to fall only 7% in 2016, and those estimates have been revised higher from the initial 2016 guidance. Also worth noting: Pure Permian Basin players, the most optimistic companies in the peer group, are cutting capital spending by only 19% and are expecting a 12% gain in production. And with Apache Corp.’s announcement earlier this week of a huge discovery in the Permian’s Southern Delaware Basin, the market is definitely making a turn. Today we discuss 2016 capex and production for a representative group of E&P companies whose proved reserves are more than 60% liquids.
Bakken crude-by-rail (CBR) volumes are down this year and pipeline shipments are increasing as production levels off in the wake of last year’s price crash. The trend is encouraged by lower price differentials between domestic and international crude as well as new pipelines coming online. Since 2012 a combination of rail and pipeline has given Bakken producers ample crude takeaway capacity but pipelines alone have not had sufficient capacity on their own. However, with production slowing down, pipeline capacity is catching up and by 2017 there should be enough pipelines to carry all North Dakota’s crude to market. Today we start a two part series asking whether pipelines can replace CBR from North Dakota.
Three North Dakota electric utility companies are adding close to 800 MW of new generating capacity in the next five years. Unlike 68 percent of the State’s current generating capacity that uses coal fuel, the new plants will be powered by locally produced natural gas. The plants are needed in part to meet growing demand for power from Williston Basin oil and gas field services and infrastructure. A 2012 study sponsored by the North Dakota Transmission Authority estimates that demand in 45 Williston Basin counties will increase by 90 percent or 1000 MW between 2012 and 2017. Today we review regional power demand from the oil and gas industry.
In the space of just over one year North Dakota crude rail takeaway capacity has reached close to 1 MMBb/d. According to the North Dakota Pipeline Authority 58 percent of October 2012 Williston Basin production of over 800 Mb/d was transported out of North Dakota by rail. There are now 18 crude loading terminals operating in North Dakota on the BNSF and Canadian Pacific (CP) railroads. Today we continue our series on crude by rail with a North Dakota terminal inventory.
Oil production from the North Dakota Bakken shale reached 639 Mb/d in May 2012. Associated natural gas production was 651 MMcf/d. So far oil production has been the main focus for Bakken producers. Gas production has been an afterthought. So much so that 1/3rd of it is flared. A new BENTEK study for North Dakota energy policymakers (we provide a link to the study) indicates natural gas volumes in the region will increase substantially in the coming years. The obvious market for this gas is to displace Canadian gas flowing through the Bakken to get to the Midwest. Today we look at the coming battle for pipeline capacity between producers in the Bakken and those in Canada.
