Showing posts with label forecast. Show all posts
Showing posts with label forecast. Show all posts

Saturday, July 20, 2013

Musings: Oil Industry On Alert - Active Hurricane Season Forecast

Musings: Oil Industry On Alert - Active Hurricane Season Forecast

This opinion piece presents the opinions of the author.
It does not necessarily reflect the views of Rigzone.

Earlier this month, the tropical storm forecasting team of Philip J. Klotzbach and William M. Gray, professors in the Department of Atmospheric Science at Colorado State University (CSU), released their first forecast for the upcoming hurricane season. They are calling for the season to experience "enhanced activity compared with the 1981-2010 climatology," meaning it will be an active storm season. Furthermore, the forecasters "anticipate an above-average probability for major hurricanes making landfall along the United States coastline and in the Caribbean." In other words, be prepared.

Based on the work the tropical storm forecasting team has done in conjunction with the GeoGraphics Laboratory at Bridgewater State University in Massachusetts, the model predicts that there is a 72% probability of a major hurricane making landfall along the entire U.S. coastline compared to a 52% average for the past century. For the U.S. East Coast including the Florida Peninsula, the probability of landfall is 48% versus a 31% historic record. For the Gulf Coast from the Florida Peninsula to Brownsville, Texas, the probability is 47% compared to a 30% record. The model also estimates that the Caribbean has a 61% probability versus 42% historically of experiencing a major hurricane landfall. These higher than historic probabilities will have the U.S. petroleum industry on alert during the upcoming season although even with a very low probability it only takes one storm to create serious disruption and economic hardship.

The CSU forecasters are using a relatively new April forecasting model that employs four predictors they have found to have an above-average predictive value. This is the third year the forecasters have used this model, which is built on data from 1982-2010. The model incorporates the most recent and reliable data available, which the forecasters believe helps improve the model's predictive ability. They said these four predictors helped the model to correlate with the Net Tropical Cyclone Activity (NTC) at 0.79 when all years studied are included. A drop-one cross-validation analysis yields a correlation with the NTC of 0.68. This is a more realistic view of the skill the model will have in future years. The forecasters say that this model correctly predicted above- or below-average seasons in 22 out of 31 hindcast years, a 71% average. The model's predictions have had a smaller error than climatology in 19 of 31 years for a 61% average.
The predictors used in the model include the average sea surface temperature (SST) in the Atlantic basin in the January to March period, the sea level pressure (SLP) for March in the central Atlantic Basin and the February to March SLP in the Pacific Ocean region off South America, and the European Centre for Medium-Range Weather Forecast (ECMWF) of the SLP in the Pacific Ocean along the Equator.

Musings: Oil Industry On Alert - Active Hurricane Season Forecast

The CSU forecast calls for 18 named tropical storms during the season with nine hurricanes and four of them becoming intense (major) hurricanes, meaning they are storms in the intensity range of 3-4-5. They believe that 2013's activity will be similar to the 2011, 2010 and 2009 years with the exception of the number of intense hurricanes last year. This year's activity would also compare with 2008, but not as intense as 2005 when there were 26 named storms and seven intense ones and 2004 with 14 named storms and six intense hurricanes. The comparison of the April forecast with the most recent six years is displayed in Exhibit 14.

Musings: Oil Industry On Alert - Active Hurricane Season Forecast

The reason for the above-average forecast this season for tropical storms, hurricanes and intense hurricanes is because the meteorological projections call for the combination of an anomalously warm tropical Atlantic basin and a relatively low likelihood of the formation of an El Niño. To modify the forecast from the output of the model, the forecasters look to analog years. In selecting the analog years, the forecasters look for those years with similar meteorological conditions as projected for this season. None of the analog years had a significant El Niño during the peak of the hurricane season, which is the condition anticipated this year. The forecasters are anticipating that 2013 will have more activity than the average of the five analog years selected – 1915, 1952, 1966, 1996 and 2004.

Musings: Oil Industry On Alert - Active Hurricane Season Forecast

The next forecast update will be produced at the beginning of June and it will be interesting to see what modifications are made. The development of El Niño could alter the forecast meaningfully, but the likelihood is that this year will be more active – consistent with the more active tropical storm phase for the Atlantic basin. If the CSU forecast on landfall potential proves correct, the energy industry will need to be vigilant and is likely to have several episodes when offshore operations will need to be shut down and crews evacuated. That will mean the Gulf will produce less oil and gas this summer than potentially anticipated now by operators and forecasters. All of these possibilities need to be considered when making projections about how the domestic energy business will play out in 2013.

G. Allen Brooks works as the Managing Director at PPHB LP. Reprinted with permission of PPHB.

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Tuesday, June 4, 2013

EnQuest Cuts 2013 Production Forecast due to Brent Shutdown

North Sea-focused independent EnQuest reported Wednesday that it has reduced its guidance for production during the whole of 2013 by approximately 1,000 barrels of oil equivalent per day (boepd), mainly as a result of shutdowns involving the Brent pipeline during the first quarter.

Reporting its results for 2012, EnQuest said that it now expects average production for 2013 to come in at between 22,000 boepd and 27,000 boepd. For 2012, EnQuest reported average production of 22,802 boepd – down 3.8 percent on 2011.

Meanwhile, the firm added that it expects to drill 12 wells during 2013. These will include six production wells, three injection wells and three exploration/appraisal wells.

Capital expenditure for 2013 is expected to be approximately $750 million, with around $350 million invested in EnQuest's Alma/Galia development located on the P1825 license, Block 30/24b, in the UK North Sea. The development is scheduled to begin in 4Q 2013.

$75 million has been earmarked as pre-development expenditure for the North Sea's Kraken development prior to the submission of the project's field development plan. First oil from Kraken is targeted for 2016.

Appraisal wells will be drilled at Cairngorm and Kraken during 2013, while the firm also expects to drill an exploration/appraisal well in the Sabah area, offshore Malaysia.

Oil sector analysts at JPMorgan Cazenove noted that the Alma/Galia and Kraken projects remain on track. "These major projects at the main drivers behind EnQuest's medium term production growth, and they reduce EnQuest's reliance on third party infrastructure," they said.

EnQuest's results for 2012 showed that the firm's proved and probable reserves stood at 128.6 million barrels of oil equivalent at the start of 2013 – an 11-percent increase compared with the start of 2012. Meanwhile, the firm's UK production licenses increased from 22 at the start of 2012 to 39 by the end of the year – with 11 licenses coming from the UK's 27th Licensing Round. 

A former engineer, Jon is an award-winning editor who has covered the technology, engineering and energy sectors since the mid-1990s. Email Jon at jmainwaring@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

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Monday, June 3, 2013

EnQuest Cuts 2013 Production Forecast due to Brent Shutdown

North Sea-focused independent EnQuest reported Wednesday that it has reduced its guidance for production during the whole of 2013 by approximately 1,000 barrels of oil equivalent per day (boepd), mainly as a result of shutdowns involving the Brent pipeline during the first quarter.

Reporting its results for 2012, EnQuest said that it now expects average production for 2013 to come in at between 22,000 boepd and 27,000 boepd. For 2012, EnQuest reported average production of 22,802 boepd – down 3.8 percent on 2011.

Meanwhile, the firm added that it expects to drill 12 wells during 2013. These will include six production wells, three injection wells and three exploration/appraisal wells.

Capital expenditure for 2013 is expected to be approximately $750 million, with around $350 million invested in EnQuest's Alma/Galia development located on the P1825 license, Block 30/24b, in the UK North Sea. The development is scheduled to begin in 4Q 2013.

$75 million has been earmarked as pre-development expenditure for the North Sea's Kraken development prior to the submission of the project's field development plan. First oil from Kraken is targeted for 2016.

Appraisal wells will be drilled at Cairngorm and Kraken during 2013, while the firm also expects to drill an exploration/appraisal well in the Sabah area, offshore Malaysia.

Oil sector analysts at JPMorgan Cazenove noted that the Alma/Galia and Kraken projects remain on track. "These major projects at the main drivers behind EnQuest's medium term production growth, and they reduce EnQuest's reliance on third party infrastructure," they said.

EnQuest's results for 2012 showed that the firm's proved and probable reserves stood at 128.6 million barrels of oil equivalent at the start of 2013 – an 11-percent increase compared with the start of 2012. Meanwhile, the firm's UK production licenses increased from 22 at the start of 2012 to 39 by the end of the year – with 11 licenses coming from the UK's 27th Licensing Round. 

A former engineer, Jon is an award-winning editor who has covered the technology, engineering and energy sectors since the mid-1990s. Email Jon at jmainwaring@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Saturday, June 1, 2013

EnQuest Cuts 2013 Production Forecast due to Brent Shutdown

North Sea-focused independent EnQuest reported Wednesday that it has reduced its guidance for production during the whole of 2013 by approximately 1,000 barrels of oil equivalent per day (boepd), mainly as a result of shutdowns involving the Brent pipeline during the first quarter.

Reporting its results for 2012, EnQuest said that it now expects average production for 2013 to come in at between 22,000 boepd and 27,000 boepd. For 2012, EnQuest reported average production of 22,802 boepd – down 3.8 percent on 2011.

Meanwhile, the firm added that it expects to drill 12 wells during 2013. These will include six production wells, three injection wells and three exploration/appraisal wells.

Capital expenditure for 2013 is expected to be approximately $750 million, with around $350 million invested in EnQuest's Alma/Galia development located on the P1825 license, Block 30/24b, in the UK North Sea. The development is scheduled to begin in 4Q 2013.

$75 million has been earmarked as pre-development expenditure for the North Sea's Kraken development prior to the submission of the project's field development plan. First oil from Kraken is targeted for 2016.

Appraisal wells will be drilled at Cairngorm and Kraken during 2013, while the firm also expects to drill an exploration/appraisal well in the Sabah area, offshore Malaysia.

Oil sector analysts at JPMorgan Cazenove noted that the Alma/Galia and Kraken projects remain on track. "These major projects at the main drivers behind EnQuest's medium term production growth, and they reduce EnQuest's reliance on third party infrastructure," they said.

EnQuest's results for 2012 showed that the firm's proved and probable reserves stood at 128.6 million barrels of oil equivalent at the start of 2013 – an 11-percent increase compared with the start of 2012. Meanwhile, the firm's UK production licenses increased from 22 at the start of 2012 to 39 by the end of the year – with 11 licenses coming from the UK's 27th Licensing Round. 

A former engineer, Jon is an award-winning editor who has covered the technology, engineering and energy sectors since the mid-1990s. Email Jon at jmainwaring@rigzone.com.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Monday, May 20, 2013

PetroChina 2012 Net Below Forecast; To Speed Up Overseas Expansion

HONG KONG - PetroChina Co. aims to speed up overseas acquisitions, exploration and production even after its net profit lagged behind analysts' expectations, as China's largest listed oil company by output hopes to secure more resources to feed growing domestic demand.

Beijing-based PetroChina aims to produce 200 million metric tons of oil and gas a year by the end of 2015, 10% more than the record 181.8 million tons produced last year, Vice President Sun Longde told reporters in Hong Kong Thursday.

The company is seeking acquisition targets in Central Asia, Middle East, North America, Africa and Asia, Mr. Sun said, but didn't name any targets.

"Over the next three years, we will continue to increase our international presence. Overseas production will account for 50% of the company's total oil and gas production by 2015 [versus 10% last year]," Mr. Sun said.

The ambitious plan is an extension of ex-chairman Jiang Jiemin's push to expand beyond China's shores. Mr. Jiang resigned as chairman of PetroChina and China National Petroleum Corp. Monday to head China's State-owned Assets Supervision and Administration Commission. The change is effectively a promotion for Mr. Jiang, as he will now oversee all of China's non-financial state-owned assets, including PetroChina and its parent, CNPC.

Since 2007, CNPC has invested $12 billion in oil and gas projects in Canada, Australia, the U.S. and France, according to data provider Dealogic.

PetroChina is speeding up exploration and production of natural gas, in response to a sharp rise in domestic natural gas consumption because of the government's push to encourage the use of cleaner fuels.

However, its natural gas business has been incurring losses since last year, because it needs to procure expensive natural gas imports to meet rising demand, but has to sell at government-set prices that are lower than import costs.

Its natural gas and pipeline business swung to an operating loss of 2.11 billion yuan (US $339.5 million) in 2012, from an operating profit of 15.5 billion yuan.

Mr. Sun said he is positive about China's natural gas market this year, as the Chinese government could roll out a new pricing mechanism and increase domestic gas prices.

"We suffered a total of 41.9 billion yuan in losses from importing piped natural gas from Central Asia last year. As gas imports have dented our profitability, we expect the government to accelerate natural gas pricing reforms," he said.

PetroChina's revenue rose 9.6% to 2.2 trillion yuan in 2012 due to increases in oil and gas output. However, its net profit fell 13% to 115.33 billion yuan from 132.96 billion yuan in 2011, because of losses from its natural gas and refining businesses. It was below the average 125.1 billion yuan forecast of 29 analysts polled earlier by Thomson Reuters.

High crude costs squeezed its downstream refining and chemical operations last year as China's fuel-pricing system prevents refiners from passing on higher costs to consumers.

To contain inflation, the government often forces the two largest refiners--PetroChina and China Petroleum & Chemical Corp., or Sinopec--to maintain prices for refined products even when crude oil prices surge in the global market.

Analysts expect domestic refining margins to improve in the first quarter after the government raised domestic gasoline and diesel prices by 3.5%-3.8% in late February. The government will likely implement a new fuel policy in the near term, they said.

Copyright (c) 2012 Dow Jones & Company, Inc.

Post a Comment Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

PetroChina 2012 Net Below Forecast; To Speed Up Overseas Expansion

HONG KONG - PetroChina Co. aims to speed up overseas acquisitions, exploration and production even after its net profit lagged behind analysts' expectations, as China's largest listed oil company by output hopes to secure more resources to feed growing domestic demand.

Beijing-based PetroChina aims to produce 200 million metric tons of oil and gas a year by the end of 2015, 10% more than the record 181.8 million tons produced last year, Vice President Sun Longde told reporters in Hong Kong Thursday.

The company is seeking acquisition targets in Central Asia, Middle East, North America, Africa and Asia, Mr. Sun said, but didn't name any targets.

"Over the next three years, we will continue to increase our international presence. Overseas production will account for 50% of the company's total oil and gas production by 2015 [versus 10% last year]," Mr. Sun said.

The ambitious plan is an extension of ex-chairman Jiang Jiemin's push to expand beyond China's shores. Mr. Jiang resigned as chairman of PetroChina and China National Petroleum Corp. Monday to head China's State-owned Assets Supervision and Administration Commission. The change is effectively a promotion for Mr. Jiang, as he will now oversee all of China's non-financial state-owned assets, including PetroChina and its parent, CNPC.

Since 2007, CNPC has invested $12 billion in oil and gas projects in Canada, Australia, the U.S. and France, according to data provider Dealogic.

PetroChina is speeding up exploration and production of natural gas, in response to a sharp rise in domestic natural gas consumption because of the government's push to encourage the use of cleaner fuels.

However, its natural gas business has been incurring losses since last year, because it needs to procure expensive natural gas imports to meet rising demand, but has to sell at government-set prices that are lower than import costs.

Its natural gas and pipeline business swung to an operating loss of 2.11 billion yuan (US $339.5 million) in 2012, from an operating profit of 15.5 billion yuan.

Mr. Sun said he is positive about China's natural gas market this year, as the Chinese government could roll out a new pricing mechanism and increase domestic gas prices.

"We suffered a total of 41.9 billion yuan in losses from importing piped natural gas from Central Asia last year. As gas imports have dented our profitability, we expect the government to accelerate natural gas pricing reforms," he said.

PetroChina's revenue rose 9.6% to 2.2 trillion yuan in 2012 due to increases in oil and gas output. However, its net profit fell 13% to 115.33 billion yuan from 132.96 billion yuan in 2011, because of losses from its natural gas and refining businesses. It was below the average 125.1 billion yuan forecast of 29 analysts polled earlier by Thomson Reuters.

High crude costs squeezed its downstream refining and chemical operations last year as China's fuel-pricing system prevents refiners from passing on higher costs to consumers.

To contain inflation, the government often forces the two largest refiners--PetroChina and China Petroleum & Chemical Corp., or Sinopec--to maintain prices for refined products even when crude oil prices surge in the global market.

Analysts expect domestic refining margins to improve in the first quarter after the government raised domestic gasoline and diesel prices by 3.5%-3.8% in late February. The government will likely implement a new fuel policy in the near term, they said.

Copyright (c) 2012 Dow Jones & Company, Inc.

Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

View the original article here

Monday, December 17, 2012

Bleak forecast hits Aggreko shares

Aggreko (AGK) was the biggest faller on the FTSE 100 in early trading, losing 16%, after the company warned its 2013 forecasts had been too optimistic.

The temporary power firm said that with military orders falling, Japanese renewals not expected and the effect of the Olympics in 2012, it is likely to report lower revenue next year.

The market for international power projects was waning, the company said, but stressed that it expected growth in both domestic and international business.

However, this was not expected to be significant enough to offset the expected

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