ResNet Review is the Energy Newsletter for the Shalennial Generation
Here’s our top Energy Headlines for February:
Thank You China
According to the IEA, Oil demand is supposed to hit records highs this year due to China’s reopening. Asian countries will account for 1.4 million barrels per day of the expected 2 million barrel per day growth this year.
Wanna get away? Demand for aviation fuels is expected to surge by 1.1 million barrels per day globally this year, with January showing an uptick in air travel around China's Lunar New Year holiday.
Sadly, still no Spirit Airlines flights to Hong Kong (HOU-HKG is $1,400 round-trip on United)
Still not convinced it’s a good time to be an oil producer? US President Joe Biden himself declared in his State of the Union, “we’re still going to need oil and gas for a while.”
Thank God. Everyone can finally get some sleep.
A word of caution for the bulls out there, though. More demand does not necessarily correlate to higher prices. The IEA also raised its supply forecast due to the resilience of Russian crude production despite Western sanctions.
“We will not let our war crimes against the Ukrainian people get in the way of producing more oil.” - Vladimir Putin, probably
Natural Gas Prices Confirm Once And For All That Global Warming Exists
Thanks to a warm winter, natural gas prices have fallen to their lowest level since September 2020, with US prices dropping by 10% to $2.06 per million BTUs.
Like volatility? S&P GSCI Natural Gas index is down 48% YTD. Last year it went from 178 to 450 to 200 in the same calendar year. Natural gas traders are the guys the crypto trader’s girlfriend says not to worry about.
But wait, can’t the US leverage its abundant natural gas resources to profitably export US LNG to not only benefit the US economy but also enhance global energy security? All while lowering net carbon emissions substantially? Creating more jobs for Americans?
Theoretically yes, but let’s not put the cart before the horse. First, we need to address the real existential threat to our existence as a species: Hotel Resort Fees
Drill Baby Drill...Still ?
BP has dialed back its green energy transition as the company faced a tough financial position and mounting shareholder concerns. Make sure you’re sitting down before reading about their plan to turn around the company below.
Produce more oil.
Recent financial struggles, coupled with its commitment to maintain a strong dividend, have forced the oil giant to focus more on immediate returns rather than long-term investments.
Solution? Produce more oil.
The company planned to spend $70 billion on low-carbon initiatives over the next decade, but it has now cut its investment to $50 billion.
The company's decision to scale back its green energy transition has drawn criticism from some investors and activists who accuse the company of not doing enough to address climate change.
Yaaaas queen. Preach, activists. Gotta keep these for-profit oil companies with fiduciary duties to shareholders in-line when they start reallocating capital into investments with the highest returns. Am I doing this right?
Oil & Gas Powering Up to Save the Planet
TLDR: Rice-a-$RONI = Zero-emission, fossil fuel powered power gen. Waste (super-critical CO2) = moar O&G with EOR. Liberal eco-terrorists rekt.
Power generation is the largest source of global emissions, around 14 billion tonnes annually, primarily from coal and natural gas-fired power plants.
NET Power’s (NPWR) proprietary process combines oxy-combustion with a supercritical CO2 power generation cycle to generate near zero-emission electricity. Then, the CO2 can be sequestered, or used as a tertiary agent for enhanced oil recovery (EOR) applications.
IRA boosted 45Q federal tax credits for carbon that is captured and stored from $50 per tonne to $85, underpinning NPWR's ability to compete with renewable power gen in zero-to-negative power price conditions.
Every NET Power plant will generate roughly ~300MWe of power gen and ~800,000 tonnes per year of super-critical CO2 for permanent sequestration or tertiary recovery applications.
Equivalent to ~150 wind turbines or ~2,300 acres solar farm (when the sun is shining)
The British are Coming!
Chesapeake has found a chemical romance with INEOS, a British Chemical Maker, which will be acquiring one of its Eagle Ford packages for $1.4B.
Deal is U.K firm’s first deal in US oil and gas production, as CHK rebalances its asset mix back to natural gas.
This deal gives INEOS, run by billionaire businessman Jim Ratcliffe, access to the petroleum products and natural gas that is key to its core business at a time of significant disruption in global gas markets caused by Russia's invasion of Ukraine.
Best of EFT
In cased you missed them, we’ve curated a shortlist of the best of the best Energy FinTwit (EFT) tweets from the past month. Cheers 🍻
Are renewables working hard? Or hardly working? 👇
— max gagliardi (@max_gagliardi)
Feb 15, 2023
LOL, 2016 spacing assumptions: 🤌
— NeverSchelling.eth🦇🔊 (@EFMinerals)
Jan 10, 2023
Speaking of which, if this resonates for you, and you still have spacing, landing zone, or any other science you or your reservoir department may be pondering - we’ve got just the solution - Intelligent Flow Control #ShamelessPlug
You’re right Cathie, getting added to the index of the 100 largest companies in the Nadsaq is your clearest sign yet of oil demand destruction. Great work!
— Kaes Van't Hof (@KVanthof)
Jan 5, 2023
The popular leaders of the climate change movement are the Mega Church leaders of our time. It’s a religion based off faith, fear, power.
Make no mistake. In this Church of Climate Change, these elitist environmentalists are after one thing:
— NextWave EFT (@NextWaveEFT)
Jan 9, 2023
In a bold move to avoid an apocalyptic 2.5 degree increase in temperatures by 2050, Americans in 2022 moved to states that were on average… 17 degrees warmer.
(They will be ok)
— NextWave EFT (@NextWaveEFT)
Jan 17, 2023
#natgas after the long weekend 😞
— Paul Phillips (@BlueFlameBlues)
Feb 21, 2023
Coming to an Event Near You!
March 8 - Digital Wildcatters, Empower 2023 - Houston, TX
April 3 - SAGA Wisdom, Sokkvabekkr 2023 - Nashville, TN
April 5 - Digital Wildcatters, Energy Tech Night - Denver, CO
April 11 - SPE Technology Showcase - Scottsdale, AZ
April 26 - World Oilman's Poker Tournament 2023 - Las Vegas, NV
June 13th - June 15th - URTeC 2023- Denver, CO
A Little About ResNet
ResNet AI Inc. is an oil and gas software company that specializes in operations surveillance and asset management software, as well as bespoke digital & reservoir services. Our mission is to Unite the Field & Office towards common corporate objectives. Our software and services are purpose-built for oil & gas applications, and if this newsletter isn’t testimony to that - then you should check out Tinder for the Oilfield, or WellTender, or as we Shalennials call it: Tender 🔥 - where you can swipe right, swipe left, and get the right guy to the right job at the right time 😎
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