The 2014 oil price crash halted investment in new oil and gas projects and caused a major re-evaluation within the industry. When oil prices returned to costing between 60 and 70 USD per barrel, confidence rose and investments in new oil and gas sites resumed. Now many countries are on the cusp of reaching record high production numbers – with flaring levels in 2019 following suit.
Demanding the new million
The stabilisation of oil prices was brought about by global efforts from the Organisation of the Petroleum Exporting Countries (OPEC), a strong world economy and steady demand growth for oil. This success is remarkable considering oil barrel production increased by one million during the recovery period.
While US demand is high, it has not increased by large figures in almost four decades. Demand in the EU has actually decreased in that same time period. Instead oil demand is being fuelled by the Asia Pacific Region, climbing from 9.1 million barrels per day (BPD) in 1973 to 34.6 million BPD in 2017. If Asia continues requiring such high quantities of oil and gas, the industry can continue its current production growth into 2019.
The US shale gas boom has been key in meeting rising demand for oil. West Texas’ Permian Basin has received close to 20 per cent of all new investment, with more than 800,000 BPD added to world production by the Permian alone. There is potential for the Permian to surpass Saudi Arabia’s Ghawar Field as the world’s largest oilfield.
Global gas trade has experienced a similar – if smaller – recovery compared to oil. Asian LNG growth has been stronger than expected, with projects starting or resuming that had been on hold for years. Shale-oil production growth in the US has resulted in large supplies of natural gas, meaning the US petrochemical and refining industry will continue to grow throughout 2019. Across the board the outlook for the coming year is strong, with production levels remaining high and investment increasing from almost every country.
A tonal shift
However, the excess natural gas being produced is exceeding company abilities to move such large amounts of gas. This means large volumes of natural gas is flared instead, resulting in a loss of potential energy. There is also a rising shift in the industry towards reducing methane emissions. This is combined with new limits on hydrocarbon use as well as lenders being less willing to finance carbon-intensive projects and industries. In this changing climate, oil and gas operators will need to evaluate and monitor their effect on the environment.
Gas flaring releases Carbon Dioxide (CO2) into the atmosphere. Routine flaring – when excess natural gas is burned for reasons other than safety – wastes a valuable energy resource that could be used to support economic growth and progress.
To effectively monitor flared natural gas, countries will need to use accurate measuring tools. Fluenta’s FGM 160 Flare Gas Meter uses ultrasonic technology to provide accurate flare gas measurement, enabling operators to better track emissions data for clear and accurate reporting.
For more information on Fluenta’s FGM 160 Flare Gas Meter, click here.