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ARE WE RUNNING OUT OF HELIUM? PRICE SURGES AS GLOBAL SUPPLIES DWINDLE

NEWSWEEK: BY  

major shortage of helium has begun to make its impact felt across a number of industries, as a combination of dwindling resources and increasing prices take their toll.

The gas, one of the lightest substances in the world, can be harvested from natural underground deposits and from the production of natural gas, in which helium is a by-product. But there are currently no cost-effective ways of artificially producing the gas, which has left a host of sectors scrambling.

While helium usage is widespread, its sources are relatively limited, and the U.S. has provided the lion’s share of the world’s supply for decades. According to Gasworld, more than three-quarters of the globe’s helium is produced across three different locations—Texas, Wyoming and Qatar.

The U.S. will exit the helium business by the end of September 2021, as established by the Helium Stewardship Act of 2013. Also, resources in Texas have dwindled because of a combination of different factors.

Helium production in the U.S. has significantly slowed down and the Bureau of Land Management has been forced to ration its supply, due to political upheaval in the Gulf States.

In February last year, Saudi Arabia imposed an economic embargo on Qatar, which effectively took some 30 percent of the global supply off the market.

While helium might be best known as laughing gas and for its use in balloons, it plays a crucial role in a number of different industries, from the aerospace to the medical sector. Read more…

Helium’s Ballooning Price may Fly Even Higher

PALM BEACH, Florida, May 30, 2018 /PRNewswire via COMTEX/ — PALM BEACH, Florida, May 30, 2018 /PRNewswire/ —

Marketnewsupdates.com News Commentary 

The world’s helium supply shortage has the medical industry worried. Why do they care? The fact is, nearly a quarter of the world’s helium is used for cryogenics in MRI machines. The situation has gotten so bad that doctors have actually called for a ban on party balloons to save helium for life-saving purposes. This critical shortage has caused a helium price surge to all-time highs and has drawn investor attention to gas producers like American Helium Inc.(AHE) AHELF, -13.59% , Praxair Inc. PX, -3.45% Air Products & Chemicals Inc. APD, +0.98% , Gazprom PAO OGZPY, +0.17% and United State Natural Gas Fund LP (nsye:UNG).

Shortage Driving Up The Price Of Helium 

Global demand for helium has risen by 10% per year over the past decade to an estimated 8 billion cubic feet. This far exceeds current supply which sits at only 5.4 billion cubic feet. This shortfall has placed an enormous strain on the price of helium, driving it up to an all-time high this year to $119 per thousand cubic feet. This represents an 11% increase over 2017. This trend is likely to continue into 2020, where the value of the helium market could exceed $1.5 billion. Read more…

Chevron walks away from $33 billion deal to buy Anadarko

Photo: Chevron CEO Mike Wirth.

Worldoil.com - By Joe Carroll and David Wethe on 5/9/2019

HOUSTON (Bloomberg) — Chevron is abandoning its $33 billion offer for Anadarko Petroleum, the culmination of a month-long bidding war in which Occidental Petroleum Corp. prevailed over a rival five times its size.

The most ambitious foray of Chevron CEO Mike Wirth’s tenure ended Thursday after the world’s third-largest oil explorer by market value elected not to sweeten an offer that fell out of favor with Anadarko directors. Chevron said it will collect a $1 billion termination fee and plans to increase its share buybacks by 25%.

Anadarko’s board embraced the Occidental proposal as superior on May 6, giving Chevron up to four days to come back with a revised offer. Anadarko was looking for Chevron to match or exceed Occidental’s proposal, people familiar with the matter said Wednesday. However, Chevron indicated that topping its rival’s offer was too risky. Read more…

 

Occidental CEO on Verge of Outmuscling a Rival Five Times as Big

Occidental Petroleum Corp. Chief Executive Officer Vicki Hollub is on the cusp of winning a David versus Goliath bidding war that has captivated the oil industry.

After making a series of approaches to rival Anadarko Petroleum Corp. about a merger over almost two years, Hollub was outflanked last month when the company embraced a takeover offer from Chevron Corp., despite it being considerably lower than her $38 billion bid.

The University of Alabama-trained engineer didn’t back down. In a series of bold and creative moves that included securing a $10 billion investment from Warren Buffett, Hollub, 59, is back in pole position in the battle for Anadarko. In gaining the stamp of approval from Anadarko’s board on Monday, she has boxed Mike Wirth, her counterpart at Chevron, into a corner with the uncomfortable choice of tarnishing his reputation for financial conservatism or conceding defeat. Read more…

Could Oxy, Buffet deal be the nail in the coffin for Chevron’s pursuit?

By Kiel Porter and Rachel Adams-Heard on 5/2/2019

CHICAGO and HOUSTON (Bloomberg) — Occidental Petroleum Corp.’s bombshell investment from Warren Buffett is the culmination of almost two years of on-and-off-again wrangling with Anadarko Petroleum Corp. — a saga that’s, so far, seen the company slip through its fingers several times.

With Buffett in its corner and a higher bid on the table, Occidental finally seems to have the upper hand over Chevron Corp.’s lower, but already agreed on, offer. Anadarko’s board has decided to start talking to Occidental again, and said that its bid could result in a superior proposal.

Occidental’s engagement with Anadarko officially brings the two Texas-based explorers back to the negotiating table again after at least four separate rounds of communication since late 2017, according to people familiar with the matter, who asked not to be identified as the details of the discussions aren’t public. As recently as December, an informal check-in by Occidental had met with a negative response from its potential target: We’re not ready.

Just two months later, Chevron entered the fray and started talking to Anadarko, the people said. It was enough to pique Occidental’s interest, and by March 23 the company had made a $76-per-share offer — including $19 in cash, the people said. Representatives from Anadarko, Chevron and Occidental declined to comment on the talks. Read more…

The Permian Basin Is Chock Full Of Potential Takeover Targets

Forbes.com: by

With its April 26 announcement that it has an agreement-in-principle for the sale of its last remaining assets in the Eagle Ford Shale, Pioneer Natural Resources is on the verge of fulfilling its objective, announced in February 2018, of attaining a new status as a pure Permian Basin play. Whether intentional or not, the company has also just made itself a more attractive takeover target for bigger companies looking to increase their holdings in the world’s hottest oil field.

A map of Permian acreage owned by each major operator, provided by the folks at industry solutions firm DrillingInfo, can be seen at this link. It shows that Pioneer’s assets are concentrated in the Midland Basin, which makes up the Eastern half of the greater Permian region. While the Midland Basin is not currently considered as attractive as acreage in the Delaware Basin in the Western half of the Permian region, potential suitors will look on Pioneer’s big swath of concentrated acreage with great favor. Read more…

Pioneer Natural Resources Clears the Path to Become a Pure Permian Play

David Blackmon April 30, 2019

Pioneer Natural Resources (NYSE:PXD) announced on April 26 that it was engaged in advanced negotiations to sell the last remaining non-Permian Basin asset in its portfolio, a suite of joint venture properties in the Eagle Ford Shale region of Central Texas. If completed, the transaction to sell the properties to Ensign Natural Resources would complete Pioneer’s two-year transition from a nationwide producer to a pure Permian Basin play.

It’s fair to note that that fact will also have the effect of making the company a more attractive target for a buyout by a larger company in the coming months. With Chevron and Oxy battling to become the acquirer of major Permian producer Anadarko Petroleum, and other majors like Shell, BP and ExxonMobil looking to enlarge their own positions in the Permian region, the industry appears to be headed into a period of rapid consolidation. Read more…

Drilling Down: Boom times in Texas’ least populated county

 
By Sergio Chapa, Staff writer Houston Chronicle

Photo by John Deiner - Washington Post

A drilling boom is under way in the least populated county in Texas.

Loving County, population 134, has become a top destination for oil and natural gas drillers. So far this year, about 18 companies have filed for 218 drilling permits, putting the West Texas county on pace to eclipse the 437 drilling permits filed by 35 companies in 2018.

The Permian Basin operations of EOG Resources, Shell and Anadarko account for nearly half of the activity Loving County.

Service companies aren’t too far behind. Carlsbad, New Mexico oilfield wastewater management company Mesquite SWD has filed to drill 30 saltwater disposal wells in Loving County so far this year. Read more…

Oil surges 2.7% to nearly 6-month high, settling at $65.70, after Trump cracks down on Iran exports

Tom DiChristopher@TDICHRISTOPHER - Weizhen Tan@WEIZENT

KEY POINTS
  • The Trump administration announced it will no longer grant sanctions waivers to any country that is currently importing Iranian oil.
  • The move threatens to wipe roughly 1 million barrels per day off the market.
  • The move comes as oil markets are already tightening and the cost of crude and gasoline is on the rise.

Oil prices surged about 3% at midday on Monday, hitting fresh 2019 highs, after the Trump administration announced that all oil buyers will have to end imports from Iran in just over a week or be subject to U.S. sanctions.

The administration said the State Department will cease granting sanctions waivers to any country still importing Iranian crude or condensate, an ultra-light form of crude oil, after May 2. Read more…

Permian water company Solaris says it’s closing in on new deal

WorldOil.com : By RACHEL ADAMS-HEARD on 4/16/2019

Photo: Solaris Water Midstream water treatment facility.

Photo: Solaris Water Midstream water treatment facility.

HOUSTON (Bloomberg) — Solaris Water Midstream, which handles water supplies and disposal for Marathon Oil, is closing in on a deal with another driller as explorers increasingly outsource one of the key components of fracing.

Backed by private equity investor Trilantic North America, Solaris has “a couple” letters of intent with oil producers in the works and expects to be handling the wastewater needs for another driller in the future, Greg Mullin, the company’s senior vice president of commercial, said at a conference in Fort Worth, Texas.

The Permian basin’s budding water business is only getting bigger as oil producers seek to cash in on infrastructure used to transport water to wells and to dispose of it after it’s been blasted into shale rock with sand and chemicals. Private equity-backed companies like Solaris have been buying the assets from drillers to become their service providers. Read more…

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