On June 26, S&P Global Platts and Argus Media introduced American GulfCoast Select (AGS), a new benchmark for U.S. crude oil which shale pioneer Harold Hamm was a driving force behind.
“It takes the entire industry community to get this done,” Hamm told Oil & Gas Investor Executive Editor-at-Large Leslie Haines and Hart Energy’s Jessica Morales. “It was a first step, but it’s a great first step.”
A catalyst for the new benchmark was April 20 when the price of WTI plunged below zero, Hamm said noting that it “seems like we have to come up to a crisis moment before you can get anything done.”
“From that point, we started looking for alternatives. Certainly, this is a great alternative to that,” he said of AGS.
“It’s needed to happen for a very long time and finally, it’s taken place,“ he continued. “This is a very huge step in a process that could bring about the market for a waterborne barrel for our type of oil, from American. We are the ones who started all of this. We started it with horizontal drilling and created a tremendous renaissance in America for new crude and natural gas to the market.”
Jump to a topic:
- What is American GulfCoast Select? (0:35)
- Importance of transparency in the market (3:53)
- Where will the price of AGS fall? (5:58)
- The group behind AGS (7:29)
- Will AGS be traded in the futures market? (9:21)
- How will this help Continental? (10:10)
- The industry’s path forward (11:50)
With American giant Exxon Mobil exiting the Dow Jones Industrial Average, it’s hard to imagine a silver lining in a bad year for the industry, but good news—very good news—might be just around the corner.
Daniel Rice, former CEO of Rice Energy who now sits on the EQT board, addressed the elephant in the room earlier this month at Hart Energy’s Energy Capital Conference.
Former Enron Corp. CEO Jeffrey Skilling has been holding meetings, hoping to win backing for a new energy venture, the Wall Street Journal reported citing unnamed sources.