[Editor’s note: Story updated at 10:42 a.m. CT Jan. 21 to correct gender attribution by Reuters in paragraphs 4 and 5.]
Pipeline operator Kinder Morgan Inc. on Jan. 20 raised concerns over the pace of ramp-up in spending in top U.S. shale basins following a rebound in oil prices after beating Wall Street estimates for quarterly results.
Oil prices are now hovering around $55/bbl on vaccine rollouts, and in the week to Jan. 15, U.S. energy firms added oil and natural gas rigs for an eighth week in a row.
"By our calculations, you're getting close to a rig level in the Permian that could get you back to flat volumes to where we were pre-pandemic," Kim Dang, president at Kinder Morgan said at a post-earnings call.
"And so it's not clear how much they would ramp up capex in response to increasing prices," she added.
While Bakken is off to a good start for the year, Eagle Ford has still been weak, she said.
U.S. oil production peaked at nearly 13 million bbl/d in late-2019, but is now around 11 million bbl/d after the coronavirus-induced lockdowns crushed fuel demand and oil prices.
Kinder Morgan, which transports nearly 40% of the natural gas consumed in the U.S., said natgas shipment volumes rose more than 6% sequentially, while total refined product volumes fell marginally.
Pipeline companies are seeing a recovery in transport volumes after the pandemic wreaked havoc on demand and forced operators to slash fees to ensure customers keep using their networks to move oil, gas and refined products.
Excluding items, Kinder Morgan earned 27 cents per share, versus estimates of 24 cents, according to Refinitiv IBES data.
Revenue also rose sequentially to $3.12 billion, above analysts' estimates of $3.05 billion.
Schlumberger has spent billions of dollars to take over managing customers' oil fields, in some cases becoming an investor in the fields, while seeking to profit from increased oil production.
The Thai chemical company said it chose the Ohio site for the proposed ethane cracker because it is located in the Marcellus and Utica shale region, the biggest U.S. natural gas shale formation.
Equitrans said that the 1.6 Bcf/d Hammerhead pipeline was, however, placed in-service on Aug. 1, after being completed and injected with initial line-pack—gas stored in a pipeline—provided by EQT in July.