The 20 Leading Companies in Shale (Tight) Oil 2014

The 20 Leading Companies in Shale (Tight) Oil 2014

Competitive Landscape Analysis

©noticeThis material is copyright by visiongain. It is against the law to reproduce any of this material without the prior written agreement of visiongain. You cannot photocopy, fax, download to database or duplicate in any other way any of the material contained in this report. Each purchase and single copy is for personal use only.

www.visiongain.com

Contents 1. Report Overview 1.1 The Shale (Tight) Oil Market Overview

1.2 Market Definition & Methodology

1.2.1 Defining Shale Oil & Tight Oil

1.2.2 Market Definition

1.2.3 Methodology

1.3 The Leading Twenty Shale (Tight) Oil Companies 2014

1.4 Why You Should Read This Report

1.5 Highlights of this Report

1.6 Key Questions Answered by This Analytical Report Include:

1.7 Who is This Report For?

1.8 Associated Visiongain Reports

1.9 About Visiongain

2. Introduction to the Shale (Tight) Oil Market 2.1 Technology & Shale (Tight) Oil Industry History

2.1.2 Shift to Shale Oil from Shale Gas

2.2 Shale (Tight) Oil Reserves

3. Global Shale (Tight) Oil Market 3.1 Oil Price Dynamics, Tight Oil Economics, Estimated Ultimate Recovery and Decline Curves

3.2 Dominant Shale (Tight) Oil Market: The US – Drivers & Restraints

4. The Leading 20 Companies in the Shale (Tight) Oil Market 4.1 Anadarko Petroleum Corporation

4.1.1 Overview, Strategy & Shale (Tight) Oil Operations

4.1.2 SWOT Analysis

4.1.3 Future Outlook

4.2 Apache Corporation


4.2.2 SWOT Analysis


4.3 Chesapeake Energy

www.visiongain.com

Contents 4.3.1 Overview, Strategy & Shale (Tight) Oil Operations

4.3.2 SWOT Analysis


4.4 Chevron


4.4.2 SWOT Analysis


4.5 Concho Resources


4.5.2 SWOT Analysis


4.6 ConocoPhillips


4.6.2 SWOT Analysis


4.7 Continental Resources


4.7.2 SWOT Analysis


4.8 Devon Energy


4.8.2 SWOT Analysis


4.9 EOG Resources


4.9.2 SWOT Analysis


4.10 EP Energy


4.10.2 SWOT Analysis


4.11 ExxonMobil




4.12 Hess Corporation

www.visiongain.com

Contents 4.12.1 Overview, Strategy & Shale (Tight) Oil Operations



4.13 Marathon Oil




4.14 Murphy Oil




4.15 Newfield Exploration Company




4.16 Noble Energy




4.17 Occidental Petroleum




4.18 Pioneer Natural Resources




4.19 Royal Dutch Shell




4.20 Whiting Petroleum




www.visiongain.com

Contents 5. PEST Analysis of the Shale (Tight) Oil Market 5.1 Political Factors

5.1.1 Energy Security

5.1.2 Government Regulation and Legislation

5.1.3 Job Creation and Tax Income

5.2 Economic Factors

5.2.1 Oil Price

5.2.2 Growing Global Oil Demand

5.3 Social Factors

5.3.1 Environmental Concerns

5.3.2 Reliance on Fossil Fuels

5.4 Technological Factors

5.4.1 Pad Drilling & Downspacing

5.4.2 EUR Debate

5.4.3 Lack of Expertise and Infrastructure Outside of North America

6. Expert Opinion 6.1 North Dakota Association of Oil and Gas Production Counties (NDAOGPC)

6.1.1 The Role of the NDAOGPC

6.1.2 Mission of NDAOGPC

6.1.3 Issues Arising from Oil & Gas Development in North Dakota

6.1.4 North Dakota Legacy Fund

6.1.5 Crude Oil Transportation, Safety and Rail

6.1.6 Community Relations with the Oil & Gas Industry

6.1.7 Anticipated Population Changes in North Dakota

6.1.8 Community Outreach Initiatives

6.1.9 State Tribe Relations Regarding Oil Development

6.1.10 The Relationship Between Farming and Oil & Gas Industries

6.2 Professor Wallace Tyner – Purdue University

6.2.1 Shale Oil & Gas Industry

6.2.2 Benefits of US Shale Oil & Gas Industry

6.2.3 US Oil and Condensate Exports

6.2.4 Gas Exports

6.2.5 Oil Supply and Related North American Developments

6.2.6 Shale Oil Development Break-Even Points

www.visiongain.com

Contents 6.2.7 Reaction From Industry to Shale Gas Analysis

6.3 North Dakota Petroleum Council

6.3.1 The Work of the North Dakota Petroleum Council

6.3.2 Aims of the North Dakota Petroleum Council

6.3.3 The Oil & Gas Industry and North Dakota Regulation

6.3.4 Natural Gas Flaring in North Dakota

6.3.5 Crude-by Rail

6.3.6 Company Engagement with North Dakota

6.3.7 Midstream Developments in North Dakota

6.3.8 Industry and Government Agenda in North Dakota Going Forward

7. Conclusions & Recommendations 7.1 Outlook for Companies in the Shale (Tight) Oil Market

7.2 Key Findings

www.visiongain.com

The 20 Leading Companies in Shale (Tight) Oil 2014: Competitive Landscape Analysis

4.12 Hess Corporation

4.12.1 Overview, Strategy & Shale (Tight) Oil Operations Table 4.34 provides a summary of Hess Corporation’s shale (tight) oil activity, while Figure 4.12

shows the company’s estimated 2013 & 2014 share of capital expenditure on shale (tight) oil.

Headquarters: New York, NY

Stock Exchange Ticker: NYSE:HES

Est. Shale (Tight) Oil CAPEX 2013 ($m): 2,200

Total CAPEX 2013 ($m): 5,873

% of Total CAPEX Budget on Shale (Tight) Oil 2013: 37.5%

Global Shale (Tight) Oil Market Share 2013 (%): 4.0%

Est. Shale (Tight) Oil CAPEX 2014 ($m): 2,200

Est. Total CAPEX 2014 ($m): 5,800

% of Total CAPEX Budget on Shale (Tight) Oil 2014: 37.9%

Global Shale (Tight) Oil Market Share 2014 (%): 3.2%

Global Shale (Tight) Oil Market Rank 2014: 14th

Hess is only involved in the tight oil market through its acreage and development of the Bakken

formation in North Dakota. However, it possesses a very dominant position in the play, with

640,000 net acres.

Like the majority of companies in the market Hess started to transition towards increasing use of

pad drilling during the second half of 2012 to attain greater cost efficiencies and lower drilling

times. Despite its large position in the play Hess decreased spending in the Bakken from over

$3bn in 2012 to around $2.2bn in 2013, at which level it will stay in 2014.

Table 4.34 Hess Corporation (Total CAPEX 2013 & 2014 ($m), Shale (Tight) Oil

CAPEX 2013 & 2014 ($m), % CAPEX on Shale (Tight) Oil in 2013 & 2014, Market

Share of CAPEX on Shale (Tight) Oil 2013 & 2014, Market Rank 2014)

Source: Visiongain 2014

www.visiongain.com


2013

2014

The below Table 4.35 details Hess Corporation’s active tight oil acreage.

Net Acres

Bakken 640,000

A stagnant CAPEX level goes against the grain of the leading tight oil companies profiled in this

report. It is partially due to decreased drilling but also because in 2012 the company completed the

construction of a crude oil rail loading and storage facility – overall investment in infrastructure is

down in 2014, but the company continues to construct its Tioga gas plant expansion and any

infrastructure tied to this. CAPEX is also flat in the Bakken as Hess undergoes a process of

redefinition, divesting downstream assets and becoming a pure-play E&P company. This change

comes as a result of investor pressure and the success of rival companies who have followed a

similar path, namely Marathon Oil and Murphy Oil (see 4.13 and 4.14). There has also been

pressure to cut CAPEX company-wide, but the success of its Bakken assets means that funding

2,200, 4%

2,200, 3%

Figure 4.12 Hess Corporation Shale (Tight) Oil Market Share 2013 & 2014 (%)


Table 4.35 Hess Corporation Active Shale (Tight) Oil Formation

Acreage (Net Acres)


www.visiongain.com


6. Expert Opinion

6.1 North Dakota Association of Oil and Gas Production Counties

(NDAOGPC) The North Dakota Association of Oil and Gas Producing Counties (NDAOGPC) is the trusted and

unified voice for the betterment of the citizens of North Dakota and the membership of the North

Dakota Association of Oil and Gas Producing Counties.

Vicky Steiner is a member of the North Dakota House of Representatives, having been elected in

2010 and has served in the 2011 and 2013 legislative sessions. She is interviewed here in her

capacity as Executive Director of the North Dakota Association of Oil and Gas Producing Counties.

Her role in this capacity is to manage the business of the association, internal and external

relationships, membership matters and administrate committee and board meetings. Education of

state legislators and staff about matters of importance to the association is a key function of her

role.

6.1.1 The Role of the NDAOGPC Visiongain: How would you describe the work of the association, your role and your relationship

with other businesses and stakeholders?

Vicky Steiner: We are an advocacy group with the West of North Dakota and the oil producing

counties. We gather statistical data to assist the state as change and development occurs.

Because of the rapid growth they need a lot of data to see what kinds of funding is needed.

We run a Uniform county truck permit system wherein if trucks run on county roads they pay an

administrative fee. That generates a couple of hundred thousand dollars for us; we take this

money and we use it to gather research that is not being done by the state.

The very first piece of research we did was a $135,000 study on county roads and how to maintain

them through this period of oil and gas development. After this, the state decided that they wanted

to do their own study, which they have now completed. We have since done a study on

emergency services and we are doing a study on dust control; in doing so we have contributed to

expertise on maintaining country roads when we have rain events. Right now the state is working

on a haulage spine, which they are putting in four miles apart in a grid pattern. We are trying to

figure out which roads will be oil haul roads and which roads we are going to not allow them to use.

The 20 Leading Companies in Shale (Tight) Oil 2014

Business

Transcript of The 20 Leading Companies in Shale (Tight) Oil 2014