Peak Supermajors 2Q2016 Results

Overview

Between 1999 and 2014 the liquid oil production rate for the supermajor oil and gas companies was on a steady decline. Between Q2-2014 to Q1-2016 this trend reversed, with liquids production increasing by over a million barrels per day. This increase in production has came on the heels of ever-increasing capital investment, which peaked out in Q4-2013. Since this peak, quarterly supermajor capital investment has dropped by nearly 60%. With less capital invested each quarter it is likely that the total supermajor oil production will return to its long-term downward trend.

Indeed this past quarter may have shown the beginning of the reversal. Supermajor liquids production declined by 7% quarter-over-quarter and increased by less than 1% year-over-year from Q2-2015 to Q2-2016.

Recent Supermajor Liquids Production

Recent Supermajor Liquids Production

Liquids Production

The supermajors’ liquids production rate for Q2-2016 was 8,931,000 barrels per day. Year-over-year, production rose by 52,802 barrels per day. Overall production peaked at 30,554,482 barrels per day in Q1-1973. Since reaching this primary peak, Supermajors liquids production rate has fallen by 70.8%. This represents a post-peak compounded annual decline rate of 2.8%. If production continued to linearly decline at this rate, it would reach zero production in 2034. The more recent peak occurred at 11,135,767 barrels per day in Q3-1999. Since reaching the second peak, Supermajors liquids production rate has fallen by 19.8%. This represents a compounded annual decline rate of 1.3%. If production continued to linearly decline at this rate, it would reach zero production in 2084.

 

Supermajor Oil Production

Supermajor Oil Production

Gas Production

The supermajors’ natural gas production rate for Q2-2016 was 38,484,000,000 cubic feet per day. Year-over-year, production rose by 224,747,253 cubic feet per day. Overall production peaked at 47,339,390,527 cubic feet per day in Q1-2010. Since reaching this primary peak, Supermajors natural gas production rate has fallen by 18.7%. This represents a post-peak compounded annual decline rate of 3.0%. If production continued to linearly decline at this rate, it would reach zero production in 2043.

Supermajor Gas Production

Supermajor Gas Production

Capex

The supermajors’ capex spend for Q2-2016 was $25,326,000,000. Year-over-year, capex spending declined by $9,221,000,000. Overall capex spending peaked at $60,346,622,300 in Q4-2013. Since reaching this peak, supermajors capex spending has fallen by 58.0%. This represents a post-peak compounded annual decline rate of 25.1%.

Supermajor Capex

Supermajor Capex

Comments

comments

Will Martin is an energy analyst and expert on peak oil and alternative currencies. He is an MBA graduate of Cornell University, where he was a Roy H. Park Leadership Fellow and concentrated on studying sustainability in business through the school’s Center for Sustainable Global Enterprise. Prior to his MBA, Will worked in the energy industry, living in Singapore, Houston and Dubai. Will is a recipient of the 2012 “Pioneer Award” from the Association for the Study of Peak Oil and Gas (ASPO-USA). He currently works as a carbon trading commercial adviser in the San Francisco Bay Area. Will is a bitcoin enthusiast and in 2014 published the book “Anonymous Cryptocurrencies,” which became a #1 best seller in 3 Amazon categories and was the first book to be sold on a decentralized marketplace.

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