The U.K. is the second-largest liquids producer in Europe (after Norway), producing one million b/d in 2015. This amount is large among European countries but small in the global market, and the U.K. remains a net importer of petroleum and other liquids. More than 97% of its liquids production in 2015 came from offshore fields, where petroleum development projects have long lead times. The majority of the offshore crude and condensate fields that began production in 2015 were approved in 2012 or earlier when oil prices were much higher.
It is a challenging business environment but it's a sign of strong resilience that businesses can look ahead and still see opportunities that exist around the globe.
Europe’s leaders have long been hoping that U.S. shale gas would help the bloc reduce its reliance on gas from Russia, which provides around a third of the region’s supplies. The ethane from Ineos’s shipment won’t be a substitute for Russian gas, which is mostly methane, but it will help to lower prices in the European market, said Karen Sund, partner at Norway-based Sund Energy consultancy.
Britain's finance minister George Osborne will cut taxes by 1 billion pounds ($1.41 billion) over five years for energy companies pumping oil from the country's North Sea fields, in a boost for an industry suffering low crude prices.
Looking at the outcome of the sensitivities Mr Tomnay offers in closing: “Russia's export strategy will be a key determinant of US LNG export capacity utilisation, but the Russian pursuit of European market share to drive out US LNG from Europe seems either uneconomic and/or impractical under different external conditions. Instead other factors such as the price of US gas, oil and European coal prices will likely be greater determinants of US LNG export capacity utilisation. Subject to these factors alone, average utilisation of US LNG export capacity between 2017-20 could vary from 54-100%. For US LNG exporters, the best thing to happen would be for global coal prices to rise, or for US gas prices to stay low."
The suppliers were chosen after a tender award. The tender covers 2,500 km of large-diameter pipes with a total weight of roughly 2.2mn metric tons. In an announcement on March 11, the consortium said that it had chosen three firms for the supply: Germany-based Europipe for 40% of the required steel pipes; Russia's United Metallurgical Company (OMK) for 33%; and Russian firm Chelyabinsk Pipe-Rolling Plant (Chelpipe) for the remaining 27%.
At low oil prices, customer choice rather than strategic Russian decision-making would allow Russia to retain over 30% of the roughly 490bn m³/yr European market and threaten US LNG export volumes.
Production drilling has commenced on the first of a total of 35 wells to be drilled during Phase 1 of the Johan Sverdrup field development offshore Norway in the North Sea, operator Statoil ASA reported.