As OPEC countries and Russia are cutting oil production, the other market players are looking to expand their market share. The total number of oil and gas buyouts on the rise, totaling at around $60 billion in the fourth quarter of 2016. The deals include purchases of land by oil and gas companies for future drilling projects. The bar for Q4 of 2016 on the diagram below (Oilprice.com) represents a sharp increase in spending, which may indicate increase in the number of drilling projects in the nearest future.
The new Trump administration is posed to open the Arctic National Wildlife Refuge for drilling. According to government estimates, the area may hold up to 12 billion barrels of crude oil and appears to be the largest untapped oil reserve in the US. The number represents an rough estimate. The exact amount of oil beneath the reserve is unknown, since only a few exploration projects were performed in the area, and the results were not disclosed.
“Its value is hard to gauge because it’s always been a bit theoretical,” said Andrew Slaughter, executive director of the Deloitte Center for Energy Solutions in Houston. “No administration has really wanted to take on the challenge of going for ANWR.”
That may be about to change. The aging Trans Alaska Pipeline, once the symbol of energy independence for an oil-strapped nation, is now on the verge of obsolescence. The 800-mile system links northern Alaska to the rest of the world, but its output has been falling as fields outside the refuge fade out and supplies from shale oil in the lower states grow.
It is estimated that oil production in ANWR is economically feasible if oil sells for at least $70 a barrel, which is more than the current price. So the development of the reserve may not happen until cheaper oil fields are depleted.