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Shale Oil will face strong headwinds next decade

This article discusses the challenges that shale oil will face in the next decade, including the growing movement against fossil fuels, air quality concerns, and the declining costs of renewables. It also explores the potential role of petrochemicals in giving shale oil a reprieve. Contact Tom Russo at tom@russoonenergy.com or +1-571-278-2741 for more information.

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Shale Oil will face strong headwinds next decade

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  1. Shale Oil will face strong headwinds next decade Southern Economics Association Conference 2018 Tom Russo, Partner, Russo on Energy LLC 571-278-2741 tom@russoonenergy.com

  2. Head winds in the oil markets Shale oil is focused on today Growing movement against use of fossil fuels Air quality and health concern in cities Renewables costs have declined Oil and gas accidents are catalysts for change Countries, Big Oil and Automakers are getting serious about electric vehicles Petrochemicals may give shale oil and gas a reprieve

  3. Shale Oil focused on today, not tomorrow

  4. Shale Oil Productivity has increased

  5. Oil has had a volatile history In 1855 kerosene was the solution to humanity’s craving for cheap artificial light In 1878 Thomas Edison invented the first electric light bulb causing a major recession in the oil industry In 1908 Henry Ford’s mass produced automobile started a demand for gasoline and initiated an oil boom In 2040, a “green wave” consisting of e may change global power and transportation

  6. There’s a growing movement against fossil fuels

  7. Morning jog in Mumbai and Morning Rush Hour in Beijing

  8. Oil and gas accidents accelerated the shift to battery storage in CA Aliso Canyon Gas Storage Leak

  9. 20 megawatt Tesla Battery Project in Los Angeles http://bit.ly/2lcC9kB On the left, Tesla batteries. Above right, transmission lines that feed and are fed by the batteries.

  10. Electric Battery Storage has established a beach head

  11. Hybrid projects are easier to finance than stand alone electric battery storage

  12. Cleaner fossil fuels step up Low sulfur diesel is replacing high sulfur fuel oils for heating & road transportation Intl Maritime Organization will require ships worldwide to switch from 3.5% sulfur bunker fuel to 0.5% in Jan 2020 Natural gas is the ”go to fuel” for power generation not oil or coal Liquefied Natural Gas exports are replacing dirtier oil and coal power plants globally

  13. EV sales will be spurred by government mandates and incentives

  14. China taking an active role in greening its transportation sector China pushing electric cars as a preferred mode of transportation- wants to to sell 2 million electric vehicles (EVs) by 2020 Goal is an internal-combustion-engine-to-EV ratio of 1:1 by 2030 Every five weeks, Chinese cities add 9,500 of the zero-emissions transporters—the equivalent of London’s entire working fleet of electric buses

  15. Big Oil wants to be ”Big Energy” Royal Dutch Shell made a big bet on natural gas and LNG by buying British Gas Shell bought NewMotion, a Dutch operator of one of Europe’s largest EV-charging networks Total is developing next-generation EV technology through its Saft battery business, acquired for $1.1bn in 2016 BP invests in mobile electric vehicle charging company FreeWire and StoreDot

  16. Petrochemicals or Natural Gas Liquids (NGLs) may give shale oil a reprieve

  17. Petrochemicals, especially plastic, are essential to wind, solar and EVs Source: The Future of Petrochemicals- a report by the International Energy Agency

  18. U.S. Petrochemical Infrastructure is taking advantage of shale revolution Source: The Future of Petrochemicals- a report by the International Energy Agency

  19. Petrochemical exports are an often overlooked benefit of the shale revolution

  20. Middle East countries are well positioned to benefit from petrochemicals HVCs are Highly Valued Chemicals Source: The Future of Petrochemicals- a report by the International Energy Agency

  21. China is to a lesser degree Source: The Future of Petrochemicals- a report by the International Energy Agency

  22. Conclusions These changes may occur in less than a decade rather than decades One significant accident with oil, natural gas or liquefied natural gas could accelerate the change OPEC and non-OPEC oil producers should build petrochemical plants to cushion the impacts

  23. The EndQuestions? Tom Russo +1-571-278-2741 tom@russooneenergy.com

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