Abby CoppingerOil and natural gas innovations and shale development continue to unlock greater production potential. In November 2017, the U.S. hit a record high of more than 10 million barrels of oil a day, the highest amount recorded since 1920 according to the U.S. Energy Information Administration.
The shale boom in oil producing states such as Oklahoma, Texas, Kansas and North Dakota have led energy experts to see 11 million barrels a day as a possibility for 2018. These levels are paving the way for the U.S. to become a global net exporter.
Closer to home, the most recent Oklahoma Energy Index (OEI) points to strong economic gains across the state. According to Chris Mostek, senior vice president of energy lending for Bank SNB, “the sustained increase in employment levels within the industry is a positive trend for both the state overall and our fellow Oklahomans.”
Geology CEO Greg Augsburger of Citizen Energy notes that producers in the recently opened Merge play of Oklahoma’s Anadarko Basin are sitting atop a resource that rivals some of the world’s major gas fields and largest new discoveries. The Merge lies between the prolific STACK (Sooner Trend, Anadarko, and Canadian and Kingfisher [counties]) and SCOOP (South Central Oklahoma Oil Province) plays, effectively tying them together.
RIG COUNTS RISING
Outside of a few pauses, the U.S. rig count has been rising. For the week ending May 25th, the total is 1,059, considerably higher than the prior year level of 908.
ENERGY-BASED STARTUPS OPTIMISTIC
Oklahoma’s active oil fields are attracting new startups such as Valiant Midstream LLC, which is backed by $150 million, 10-year investment by Dallas-based private equity firm Tailwater Capital.
“We feel like the there’s some stability within the crude and gas prices now, and it’s always a good time to invest when things are on the rise again,” said founding partner Brandon Webster. “We also see the talent pool in the Oklahoma City area as a driver to start a midstream business now.”
Entrepreneur Greg Archbald is capitalizing on the industry growth with his Oklahoma City company Greasebook, an app he created that streamlines communication between pumpers and operators. His success earned him a feature by Global Oil & Gas Industry News as one of its Up & Coming Industry Disruptors.
Opportunity on the digital end of the industry will continue to expand. Oil companies are setting their sights on large batches of data yet to be harnessed from rigs, pipes, pumps and valves. More than 7 out of 10 industry executives said they plan to spend more or significantly more on digital advances over the next three to five years. And according to a 2015 study by Oxford Economics and Cisco Consulting Services, transforming into a digital oil field could add almost $1 trillion to the world’s economy by 2025.
The technology, areas of investment and production methods of the industry are evolving and creating momentum. By avoiding stagnation and prioritizing innovation, companies will inevitably attract the younger talent necessary for future success.