This isn't directly related to this post, but it's so relevant to your philosophy that everyone deserves a chance at secure cheap energy that I wanted to just go ahead and post it to you:
I think allot of people taking a climate only approach to FF's don't realize what kind of life they are dooming the majority of the world's population to. Or maybe some of them do realize and don't care...
What I get back when I ask policy makers or activists that kind of question is that climate change will be far worse for the least fortunate. I believe they (i.e., most of them) sincerely believe that.
"But there are also companies with existing diversified, non-shale business models that have generally been out of favor during the shale revolution that are likely worthy of a fresh look." What a teaser! I sure would like to know who you think those companies are given what may be a short runway for remaining high ROI shale production as the industry churns through the top tier acreage.
Great article ...again !! Thanks 👍..Do you have a glossary of terms somewhere we might reference for the not so knowledgble? Eg Full cycle ROCE etc.. Thanks
Thank you Gary. It's a good idea. I had them in the earlier reports but have gotten away from it.
ROCE is return on capital employed. It is net income + after-tax interest expense divided by average capital employed. Average means using beginning and end of year balance sheet items. Capital employed is Total Debt + Shareholders equity minus Cash and equivalents. Full-cycle just means the average over an entire cycle...not just for a given year. Please let me know if there is a list of terms and I'll find a place to add them.
Great post Arjun! Would be very interested to see a future post on your suggestions for diversifying CapEx for those companies who think "shale is the only game in town". Given the problems with financing, insurance you've mentioned in past posts, how many opportunities with long lead times are there which company management (and their investors) will be willing to put CapEx into? I realize that it will be a case-by-case decision for most companies, but perhaps you can generalize on what you see as the best opportunies for longer term projects and where they will be located in the world? Also I would imagine that the breakdown of the existing global order might impact such future decisions by U.S. oil majors (i.e. keep investments in the perceived zone of U.S. influence).
Thank you James! I have touched upon areas of interest in recent posts...as you say, definitely case-by-case. Examples include offshore Gulf of Mexico and West Africa. Oil sands and LNG for some companies. Could be conventional play in Middle East or SE Asia.
This isn't directly related to this post, but it's so relevant to your philosophy that everyone deserves a chance at secure cheap energy that I wanted to just go ahead and post it to you:
https://twitter.com/JusperMachogu/status/1642391693075836928
Wow...quite a thread.
I think allot of people taking a climate only approach to FF's don't realize what kind of life they are dooming the majority of the world's population to. Or maybe some of them do realize and don't care...
What I get back when I ask policy makers or activists that kind of question is that climate change will be far worse for the least fortunate. I believe they (i.e., most of them) sincerely believe that.
"But there are also companies with existing diversified, non-shale business models that have generally been out of favor during the shale revolution that are likely worthy of a fresh look." What a teaser! I sure would like to know who you think those companies are given what may be a short runway for remaining high ROI shale production as the industry churns through the top tier acreage.
Sorry for the tease...basically its the swath of publicly traded companies that are not the shale pure plays.
Personally I like integrated majors like XOM...
Great article ...again !! Thanks 👍..Do you have a glossary of terms somewhere we might reference for the not so knowledgble? Eg Full cycle ROCE etc.. Thanks
Thank you Gary. It's a good idea. I had them in the earlier reports but have gotten away from it.
ROCE is return on capital employed. It is net income + after-tax interest expense divided by average capital employed. Average means using beginning and end of year balance sheet items. Capital employed is Total Debt + Shareholders equity minus Cash and equivalents. Full-cycle just means the average over an entire cycle...not just for a given year. Please let me know if there is a list of terms and I'll find a place to add them.
Great post Arjun! Would be very interested to see a future post on your suggestions for diversifying CapEx for those companies who think "shale is the only game in town". Given the problems with financing, insurance you've mentioned in past posts, how many opportunities with long lead times are there which company management (and their investors) will be willing to put CapEx into? I realize that it will be a case-by-case decision for most companies, but perhaps you can generalize on what you see as the best opportunies for longer term projects and where they will be located in the world? Also I would imagine that the breakdown of the existing global order might impact such future decisions by U.S. oil majors (i.e. keep investments in the perceived zone of U.S. influence).
Thank you James! I have touched upon areas of interest in recent posts...as you say, definitely case-by-case. Examples include offshore Gulf of Mexico and West Africa. Oil sands and LNG for some companies. Could be conventional play in Middle East or SE Asia.
I have gone through the five stages of grief with shale. I am heavily weighted to Canadian names...
LOL. I am a huge Canada fan.