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Project(s): View 3 related projects in PECWeb
Plant(s): View 3 related plants in PECWeb
Released May 21, 2020 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Last Friday, Baker Hughes Company (NYSE:BKR) (Houston, Texas) reported that the number of rigs drilling for oil and gas in the U.S. had fallen to the lowest number in the company's history of keeping count, which dates back to 1940. According to the U.S. Energy Information Administration (EIA), changes in the number of oil rigs generally follow changes in oil prices with a lag time of about four months. However, the recent decline in oil prices and demand due to the COVID-19 pandemic has been much more rapid. In addition, more midstream production projects, such as those involving natural gas liquids fractionation, have been delayed because of the virus. Industrial Info is tracking nearly $25 billion in U.S. Production Industry projects that have been delayed, placed on hold or otherwise affected by the virus.
While not a part of Baker Hughes' rig count, Industrial Info is tracking several offshore projects that have been affected by the pandemic. Among these is Royal Dutch Shell's (NYSE:RDS.A) (The Hague, Netherlands) Whale offshore field development in the Gulf of Mexico. The initial part of the project involved drilling two to four production wells at water depth of about 8,000 feet. The project was originally planned to kick off next year, but the final investment decision has been delayed because of the drop in oil demand and prices. Click here for a list of related projects.
Arena Offshore LP (The Woodlands, Texas) also has three drilling programs in the Gulf of Mexico that have been delayed due to COVID-19. Click here for a list.
A substantial portion of natural gas produced in the U.S. is associated gas that comes from the oil wells that are now being shut in. This has led to the delay of some natural gas processing projects in areas traditionally associated with oil, such as North Dakota's Bakken Shale, where ONEOK Incorporated (NYSE:OKE) (Tulsa, Oklahoma) has stopped construction on a second processing train at its Bear Creek plant near Killdeer. The train would add 200 million cubic feet per day of processing capacity. Construction began in the second half of 2019, and it was originally planned to be completed early next year. However, construction has been deferred until drilling activity in the area picks up again. Optimized Process Designs LLC (Katy, Texas) is providing engineering, procurement and construction services. For more information, see Industrial Info's project report.
Colorado's DJ Basin also has been affected, with DCP Midstream Partners LP (NYSE:DCP) (Denver, Colorado) placing on hold construction of a second gas processing train at its Bighorn processing plant in La Salle. For more information, see Industrial Info's project report.
Natural gas liquids (NGL) production also has been on the rise in recent years, particularly in the Permian Basin of Texas, from where NGLs are often piped toward the Texas Gulf Coast for fractionation. Mont Belvieu, Texas, remains a key hub for U.S. fractionation capacity, and Industrial Info has tracked several projects in this area that have been delayed because of the pandemic. Examples include an eleventh and twelfth fractionator at Enterprise Products Partners LP's (NYSE:EPD) (Houston) Mont Belvieu complex, construction on both of which kicked off last year but has now been delayed. For more information, see Industrial Info's project reports on Fractionator 11 and Fractionator 12 as well as April 30, 2020, article - Enterprise Products Remains Resilient in Uncertain Environment.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
While not a part of Baker Hughes' rig count, Industrial Info is tracking several offshore projects that have been affected by the pandemic. Among these is Royal Dutch Shell's (NYSE:RDS.A) (The Hague, Netherlands) Whale offshore field development in the Gulf of Mexico. The initial part of the project involved drilling two to four production wells at water depth of about 8,000 feet. The project was originally planned to kick off next year, but the final investment decision has been delayed because of the drop in oil demand and prices. Click here for a list of related projects.
Arena Offshore LP (The Woodlands, Texas) also has three drilling programs in the Gulf of Mexico that have been delayed due to COVID-19. Click here for a list.
A substantial portion of natural gas produced in the U.S. is associated gas that comes from the oil wells that are now being shut in. This has led to the delay of some natural gas processing projects in areas traditionally associated with oil, such as North Dakota's Bakken Shale, where ONEOK Incorporated (NYSE:OKE) (Tulsa, Oklahoma) has stopped construction on a second processing train at its Bear Creek plant near Killdeer. The train would add 200 million cubic feet per day of processing capacity. Construction began in the second half of 2019, and it was originally planned to be completed early next year. However, construction has been deferred until drilling activity in the area picks up again. Optimized Process Designs LLC (Katy, Texas) is providing engineering, procurement and construction services. For more information, see Industrial Info's project report.
Colorado's DJ Basin also has been affected, with DCP Midstream Partners LP (NYSE:DCP) (Denver, Colorado) placing on hold construction of a second gas processing train at its Bighorn processing plant in La Salle. For more information, see Industrial Info's project report.
Natural gas liquids (NGL) production also has been on the rise in recent years, particularly in the Permian Basin of Texas, from where NGLs are often piped toward the Texas Gulf Coast for fractionation. Mont Belvieu, Texas, remains a key hub for U.S. fractionation capacity, and Industrial Info has tracked several projects in this area that have been delayed because of the pandemic. Examples include an eleventh and twelfth fractionator at Enterprise Products Partners LP's (NYSE:EPD) (Houston) Mont Belvieu complex, construction on both of which kicked off last year but has now been delayed. For more information, see Industrial Info's project reports on Fractionator 11 and Fractionator 12 as well as April 30, 2020, article - Enterprise Products Remains Resilient in Uncertain Environment.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
