Statoil to Hold Back US Shale Ramp Up

August 25, 2014

World Energy Reports LLC.

Norwegian energy firm Statoil will only slightly raise its U.S. shale oil and gas output in the near term due to spending curbs, well below a potential for a 50 percent surge, the firm said on Monday.

Statoil, which produces around a tenth of its oil and gas from its U.S. shale operations in the Bakken, Eagle Ford and Marcellus formations, has even cut back investments in the area, as shale projects are competing for capital within the company, said Torstein Hole, Statoil's chief for U.S. onshore activities.

Statoil abandoned its 2020 production target earlier this year and cut its capital spending budget, arguing that it needs to save cash and return more to shareholders after a decade of ramping up spending.

The firm increased shale production to around 210,000 barrels of oil equivalent per day by the middle of 2014 from close to nothing in 2010, but output levelled off in the second quarter.

When asked if output would stay broadly unchanged for the rest of the year, Hole said during an oil and gas conference in Stavanger, west Norway: "I expect it (U.S. shale production) to be approximately the same.

"It will increase somewhat, but it will not be a significant increase. It (growth rate) will not be back to the levels we've seen in the past."

"We could easily, with the portfolio we have now, increase it to 300,000 per day. But we have the priority toward profitability."

"We have to compete for capital within the company and the pace of development will depend on how successful we are in delivering high profitability," Hole said.

Statoil earlier targeted daily production of 500,000 barrels per day from U.S. operations by 2020, including 300,000 barrels per day from shale, but also gave up that target when it revised broader projections.

(Reporting by Balazs Koranyi; editing by Alister Doyle)

Floating Production Week delivers unrivaled overview, insight and analysis to the Offshore Floating Production Systems and Technology market

Floating Production Systems Report And Online Database

  • Monthly reports -- Our monthly reports provide a detailed snapshot of the business sector as of the middle of each month. More than 80 pages of data and industry analysis each month. Excel spreadsheets with each report enable subscribers to tailor the data presentation to their needs. In October of each year we provide a detailed five year forecast of production floater orders. In March of each year we fine tune the forecast and make revisions as needed.
  • Online database -- The online database is updated every day – with information direct from primary sources. In the database are details for 240 planned projects, 370 installations in service, 70+ floaters on order and 20+ floaters available. The database is fully searchable. Customized charts and spreadsheets can be directly produced from the database.
  • Customer support -- We are available to assist with technical questions about information in the database and reports -- and assist with any questions about using the database search tools.

Here's what you get!

Request a Free Sample Report
Related company: » Statoil