In 2014 an oil price collapse triggered a wave of cost-cutting across the global Oil & Gas Industry. Expenditure was slashed by 40 per cent between 2014 and 2016, with 400,000 workers left without work and major projects cancelled or deferred. During this time oil prices fell by more than 40 per cent.
Four years later and optimism has started to return to the oil industry. Investment in upstream – the search for underground or underwater crude oil and natural gas fields – reached US $410 billion this year, up three per cent from 2016, while oil prices increased by 90 per cent. With the industry in a firm recovery, what can be expected for 2018?
A strong start for oil
2018 oil prices have recorded the strongest start to a calendar year since 2014, with crude oil opening at more than $60 a barrel. Recently Russia and Saudi Arabia – the world’s biggest oil producers – strengthened a collaborative relationship to continue this stabilisation in oil prices, with a $1 billion fund created for investment in energy projects.
The two countries act as co-presidents for the Organisation of the Petroleum Exporting Countries (OPEC), which currently seeks to combat the effects of the 2014 oil crash. To clear the global over-supply of crude oil that caused the crash, OPEC and non-OPEC countries agreed to cut production – which has now been extended until the end of 2018. US crude inventories have already dropped by more than 20 per cent from record highs recorded last March.
Now that the industry has stabilised, we can expect to see an upswing in new energy investment projects as well as an ongoing stabilisation of prices. It is predicted that there are already $200 billion worth of offshore and onshore projects ready to be sanctioned this year.
The production upswing
With increased exploratory efforts in the upstream and new investment in energy projects, the Oil & Gas Industry will benefit from a number of new projects in 2018. In the US, Trump’s administration has already announced plans to allow new offshore oil and gas drilling in nearly all United States coastal waters. At these sites, gas flaring will continue to be a critical part of on-site safety by reducing the risk of explosion – especially in remote locations.
However, routine flaring occurs when gas is flared for reasons other than safety. When crude oil is extracted and produced from onshore or offshore oil wells, raw natural gas also reaches the surface. In areas of the world lacking pipelines and other gas transportation infrastructure, this gas is commonly flared, wasting a valuable energy resource and releasing harmful emissions into the environment.
Accurate flare gas measurement will help oil and gas operators to monitor and manage the amount of gas being regularly flared. However, gas flow measurement is one of the most challenging forms of measurement. Fluenta’s FGM 160 measures gas flow using ultrasonic technology. By understanding how much gas is being flared, oil and gas operators can test new methods to reduce routine flaring, ensuring flaring only occurs for safety reasons.
For more information about the FGM 160 – click here.