Azerbaijan: Make The Most of Oil and Gas Investment

Azerbaijan is one of the birthplaces of the oil industry, as it’s history is liked to the richness of petroleum. Moreover, it’s definitely aimed to becoming an important gas and oil producer once again.
 
Recently, it’s been recorded that Azerbaijan oil sector has been grown by 33%.  From January to July 2013, over $3.38 billion were invested in gas and oil sector in this country. This is 33.1% higher than what was last year. According to the Azeri news outlet Trend that 393.5 million manat was invested in oil and gas in July 2013, compared to 274 million in July 2012.

Let’s have a look at the oil and gas investment background of this country:

* Azerbaijan is the 2nd largest fastest-growing economy out of 179 nations across the world in terms of GDP per capita between 2001 and 2010.

* Its GDP is further expected to increase by 4.2% this year, according to World Bank.

* In Azerbaijan’s oil and gas sector, around $50bn has been invested and $120bn invested in national economy ever since 1995.

* Fortunately, there are many proven gas reserves in this country of around 2.6tcm.

* In its Shah Deniz gas field, around $45bn has been invested- i.e one of the biggest projects in this country, to produce 16bcm of gas for export to the markets of Europe.

* By 2025, around $26bn will be spent, as a part of the development of SOCAR.

* According to SOCAR, in Azerbaijan, there are 4bn tons of recoverable oil reserves.

* By 2020, it’s estimated that the gas production will reach 30bcm and by 2025, it’ll be 50bcm.

Considering this boom in oil and gas production, there will be certainly much more investment opportunities flowing out for oil and gas investors in Azerbaijan. Thus, this country is one of the best places for those who want to make the most of their investment projects.

What’s Investment Noise? How to cope up with It?

Wisely avoiding noises is a key element to successful investment. Investment noise is the constant outburst of inessential information that we’re all witnessing almost everyday. It comes to us via the internet, financial news or even some or the other way at our workplace. So, ignore such noises and your odds for success boosts up.

And if the investors are able to reduce such noises then, for sure they’ll do well. But before reducing the noise, ensure to define it firstly. Here are the four category defined that are directly related to any of the investment noises.

1.Unusable:
          
When your behaviour and actions won’t be changed by the information spilling over around, then the information is more likely noise.  An excellent instance is our tendency to not to ponder over the current events-until and unless we find it that much interesting. So will savage gas attack in Syria cut off oil flow through the Suez Canal and cause a global stress?  Well, it’s been affecting though. But if this even has no effect on your long-term strategy, then do ignore it. But always with an informed decision, you can make the most of your investment in any reputable company. 

2.Untimely:

If you’re not going to use the information in the forthcoming days but by the time you again change your mind to use it, then such information is merely a noise. And bear in mind that, the action will harm you if it start changing your behavior- so avoid looking over.

3.Hypothetical:

This is perhaps; the commonest type of noise because it’s literally relied on what someone thinks will take place. Listening to prediction of a think tank about the stock market and the economy is quite possibly noise. And even if he/she is right, the information is practically void.

4.Distracting:

Noise may distract you from your long-term goal. Especially, those of promotional made information that are thriving forcibly upon us, should really be considered. And when it comes to investment zones, some companies may heavily reel off huge profits without claiming any loss, so in such situation get rid of this distraction as this will affect your long-term goal.

Remember that the information we listen and look at, almost always influence our outlook and actions, even though we don’t believe it really does. After all, it’s really affecting us and it can be dangerous because our brain is wired really complexly. And the fact is that bad news always overwhelms good news and that’s why we listen former for more times.

We’re swamped with negative information in this strange world. Usually, 6 o’clock and 11 o’clock news quite possibly comes up with negative stories. On the business front, whilst stock market goes down by 1%, the consequences are so much negative than positive ones. And more than in most cases in the market, the optimistic events leading up to the good day are hardly elucidated so far.

However, a successful investor sets out a realistic plan for achieving the goal. Then, the entire plan must be maintained and implemented in a cot-effective way. And the most important part is to get rid of any noise. Thus, recognize the noise, and then learn to ignore it and thereby you understand how to invest in oil and gas companies. Once you could tune the noise out, it’ll certainly lead to better investment returns.

Top 20 Countries In The World For Oil And Gas Investment

Regardless of the elementary reasons for changes in the prices of oil, investors have a number of options to capitalize on energy price fluctuations. The oil and gas market provides a wide array of options for a potential investor. From indirect exposure via energy-related stocks to more direct investment, this sector has something for everyone. It is inevitable to do your research or consult a professional in investments prior to committing your hard-earned money. Your research and data gathering should be inclusive of the best oil and gas companies, and the hot-spots that attract huge investments.

This post will take a look at the 20 best places around the globe, which are prominent for their oil and gas reserves, supplies and exports and could be a great venue for investments.

20. Azerbaijan
With more than 1.0 million barrels of oil production per day, Azerbaijan is poised to become an important oil and gas producer in the near future. Oil and gas export and development is in the center of it's economic growth. The country is primarily an exporter of crude oil and condensate, but it also exports a small volume of petroleum products.

19. United Kingdom
The UK produces 1.3 million barrels of oil daily and exports close to 775,000 barrels. In the year 2012, petroleum produced by United Kingdom was 50 million cubic metres of which 98% produce was from offshore fields.

18. Iran
The oil produce is 4.0 million barrels daily. In 2004, Iran produced 5.1 percent of world's total crude oil. This amounted to 3.9 million barrels per day. Iran was the second largest exporter among the OPEC. It is expected by the officials in Iran that the oil and gas revenues could reach $250 billion by 2015.

17. Egypt
It is the largest non-OPEC producer of oil in Africa and the second largest dry natural gas producer in the continent. Egypt's facing the challenge to cope up with the increasing domestic demand for oil. Egyp also has the largest refinery capacity in Africa. Most of Egypt's LNG is exported to Asian and European markets.

16. Oman
As of January 2013, Oman had 5.5 billion barrels, which is the 7th in the Middle East, and 21st in the world and also the crude oil ranks the same. It is the largest producer in the Middle east that is not a member of OPEC.

15. Qatar
Qatar holds the third place in the largest natural gas reserves and is the largest supplier of liquefied natural gas. It is the member of OPEC and is a vital net exporter of oil. At the end of 2012, Qatar's oil reserves were teh 13th largest in the world and it still is a very significant supplier of oil to the oil markets around the world.

14. Kazakhstan
Since 1911, Kazakhstan has been an oil producer and stands second in the list of world's largest oil reserves. It also is the second largest oil producer. Tengiz and Karachaganak are the two giant fields who dominate the current production in this country. They produce about half of Kazakhstan's total output. Most of the natural gas reserves in Kazakhstan comprise of associated gas in only four fields, Karachaganak, Imashevskoye, Tengiz and Kashagan.

13. Libya
It is a member of the Petroleum Exporting Countries organization, holds Africa's largest oil reserves, and is making a significant contribution to the global supply of sweet crude oil. Although Libya's oil production was disrupted heavily in 2011, it quickly began to recover. Libya exports most of its crude oil to European countries, Italy being the largest recipient.

12. Angola
In the Sub-Saharan Africa, Angola is the second largest oil producer, and it is suggested that Angola's reserves could be larger than what is being estimated. The Angolan government is targeting production of 2 million barrels per day by 2014. The company is well in the position to capitalize on the high demand of LNG. The Angolan government is planning to invest billions from it's treasury in the country's electricity system.

11. Algeria
Sonatrach, Algeria's oil and gas company, dominates teh country's sector of hydrocarbon, which owns rougly 80 percent of all hydrocarbon production. Sonatrach holds ownership to a majority of oil and gas projects by law. As of January 2013, Algeria had 12.2 billion barrels of proven oil reserves. Since then is limited offshore exploration, all the proven oil reserves are held onshore. A vast majority of Algerian crude oil, nearly 85 percent, is exported to Europe and North America.

10. Norway
Norway is the world's second largest exporter of natural gas and the largest oil producer. It is an important oil and natural gas supplier to other European countries. It is the producer of oil, and exporter as well in Western Europe. After Russia, it is the largest exporter of natural gas and it ranks fourth in world gas production.

9. Venezuela
This country has some of the largest reserves of oil and natural gas. It is consistently ranking as one of the top oil suppliers to the U.S. In 2010, Venezuela ranked eighth in the largest net oil exporters. It has the second largest natural gas in the Western Hemisphere and it depends heavily upon hydroelectricity for a majority of its electricity needs.

8. Kuwait
Kuwait holds the sixth largest oil reserves in the world and is a contender of a spot in the top ten global producers and exporters of petroleum liquids. The entire oil sector is controlled by Kuwait Petroleum Corporation and its subsidiaries. Project Kuwait is attempting to incentivize foreign investment to bring the capacity of the production to 4 million bbl/d towards 2020. Kuwait has recently got into net importing of natural gas.

7. Iraq
In the OPEC, Iraq surpassed Iran as the second largest producer of crude oil at the end of 2012 in OPEC. It has the fifth largest proven crude oil reserves in the globe. In 2012, Iraq stood sixth in the largest net exporter of petroleum liquids around the globe. During this period the majority of exports were going to United States and Asia.

6. Brazil
In 2012, Brazil was the largest producer of liquid fuels. More that 90% of the oil production is offshore, in deep waters. United States is the largest crude oil export destination for the past decade, including 187,000 bbl/d of crude oil being exported in 2012. The world's largest oil discoveries in recent years have come from Brazil's offshore. Brazil has the third largest electricity sector in America.

5. United Arab Emirates
The UAE stands seventh in the largest proved reserves of both crude oil and natural gas. There was a strong crude oil production in 2011 due to the enhanced oil recovery techniques. During this time UAE produced 2.69 million barrels per day.

4. Canada
One of the principal sources of U.S. energy imports, Canada is one of the world's five largest energy producers. The unconventional oil sands in Canada are vital contributors to the recent growth in the liquid fuel supply of the world. It is the world's third largest producer of dry natural gas.

3. Russia
Russia has the world's largest natural gas reserves, second largest coal reserves and the ninth largest reserves of crude oil. It is the largest producer and exporter of dry natural gas. In 2011, Russia held the record for being the largest crude oil producer. During that year, the production of crude oil averaged about 9.8 million bbl/d.

2. United States
The United States is the third largest petroleum producer in the world. It has more than half a million producing wells and nearly 4,000 oil and natural gas platforms operating in U.S. Oil and gas combinedly supply 65% of U.S. energy. More than 17 million barrels of crude oil is processed by 144 refineries of the nation. With opportunities abound in states like Texas, which has less hurdles in the regulations and good infrastructure and support, companies like In-Depth Exploration LLC have gained a big deal of investors.

1. Saudi Arabia
It has almost one-fifth of the world's recorded oil reserves. One of the largest exporter and producer of total petroleum based liquids, it maintains the world's largest oil production capacity. In 2012, Saudi Arabia ranked second after Canada as an exporter of petroleum to the United States. The natura gas production is limited, although Saudi Arabia stands fifth in the world's largest natural gas reserves.

The list of top 20 countries given here is picked out by our professionals. However, it is unavoidable to do complete research before going ahead and betting your money on a company in a certain country.

Still, Oil Prices Will Remain High!

In a report published by The Street, unfortunately there won’t be much relief at the gas pumps. Moreover, we’ve been witnessing an array of opinions, papers and articles attacking the ideas that the gas and oil prices are affected by Obama’s recent plan on the Commodity Futures Trading Commission against speculation. Besides, Syria’s disorder is adding up to the chaos of oil prices across the world.

Moreover, because of nuclear negotiations with Iran, oil prices have soared up in the last couple of weeks. But there is hope that Iranians will give up their uranium enrichment programs and thereby put an end to tensions in the Middle East and the ever-increasing threats of a supply shortage.

And quite possibly, there has been any supply risk and the impending EU embargo of Iranian oil has caused the oil and gas prices soaring up and may continue to retain high.  

Over and above, Chinese PMI reports, growing Spanish bond and Greek’s political unease are all affecting global stock market and similarly fueling oil prices. 

Alongside, according to the report published in Reuters, Iranian President has claimed that they can withstand a boycott of Iranian oil exports for over 2 years if need be.

Contrary to this, defense minister of Israel expressed doubts that sanctions can be implied to Iranians to abandon their nuclear aspirations.
 

And most importantly, the ever-increasing global demands of oil will again boost up the oil prices high and this may give ultimate advantages to investors in oil and gas to stand a good chance of getting higher returns on higher prices across the globe.

So whether it’s about buying oil stocks or participating in drilling rigs, the higher prices of this liquid gold, although can’t ease the consumers but the investors!

Top Tips to Invest in Oil and Gas Wells

Oil and gas wells are very popular investment vehicles. They not only offer huge investment returns but also provide substantial tax benefits. So for those who are looking for high capital returns can invest in this industry. So if you’re thinking of investing for the same, you should consider the below given tips in order to make your investment successful.

First of all, make sure whether you want to invest in stocks or want to participate in drilling programs and wells. Then determine the investment strategy, your expectation of profits and levels of risk involved. The more risk you take, the higher will be the profit. 

Always look for the company which has a long history, stable finance risk management and all the more proven track record of success. You can always assess all the qualities by visiting a website or by asking a due diligence report from the respective company. Overall, you ought to determine that you’ll be working with a reputable company. 

Ascertain a drilling company of your choice and have a look through their prospectus and fill out the form online. Because it’s a prerequisite for the investors in oil and gas to get qualified as accredited investors.

Make sure that you get your net value of your investment appraised by a licensed, petroleum professional so that you can have better idea about your investment venture.

You should also do some internet research on the drilling companies and locations of the wells as this will give you good understanding about the industry. It will further enhance your confidence about investment ideas.

On the top of all, make sure that you thoroughly understand and evaluate a drilling project. However the best way to understand is to make out the potential payout of a project in line with your investment.

Lastly, bear in mind that no investment is guaranteed. Oil and gas drilling is carried out on a speculative basis and therefore it is a subject to huge profits as well as significant loss.

Thus, make sure that you take care of all the essential aspects while investing in oil and gas wells.

Is It Worth Investing in Oil?

Humans have been using oil and several other petroleum products since the ancient times. In fact, it was one of the greatest discoveries. In 1859, Edwin Drake developed the first well and it was considered as a revolutionary discovery because that well, for the first time was drilled and not dug like the others. Nevertheless, there were many oil pits and wells before that first new well was developed before 1859. And the new progress led to crude oil and petroleum becoming the prime source of energy. Ever since then, candles were replaced by lamps and steam engines by fuel engines. Afterward, transportation, electricity, production of goods and communication became hugely dependant on crude oil.

It’s only because of this gold liquid- ‘oil’ which has always been keeping the whole world running. So it’s a vital resource for our existence and making the things go faster, smoother and with peace of mind. However, because of huge demands, crude oil prices have always been high. And that’s why many have people have looked at crude oil as a great source of incomer, especially by investing in oil drilling projects and stocks.

Moreover, according to recent report by EIA, global oil consumption will increase by 1.1 million bbl/d in 2013 and by 2014, it’s estimated to increase 1.4 million bbl/d in 2014. Consequently, such a high demand will surely attract more investors in oil and gas in order to avail huge returns. Besides, the government’s tax relaxations have further hugely helped out the investors. Thus, more and more numbers of investors are making the most of oil exploration and energy companies.

More than in most cases, investing in oil and gas largely depend on economics, demand, supply, prices of oil etc. Further, the demands of these resources will always be soaring up, and that’s why investing in oil stocks or participating into drilling projects is a great way. Nevertheless, there are also risk factors involved in. Thus, it becomes hugely important on your part to thoroughly consider the investment projects and then never overlook to go for reputable companies.

Production of oil begins with drilling wells and oil pits. And in these areas, most of the money is spent. Since the development stage is hugely costly, the government also encourages potential investors to participate in the oil industry by aiding them with tax relaxations.

However, due to global warming issues and other inconveniences, governments across the world are putting their best efforts to enhance green technologies, but it’ll possibly take longer years to completely depend on them. Thus, investing in oil is a very interesting as well as hugely advantageous way if you’ve rightly approached good investment company. Thus, when it comes to investing, ensure that you take up good research work and catch good advice from the processionals.

How is Oil Stabilizing World Economy?

According to a report issued by National Centre for Policy and Analysis the increasing supply of oil in Canada and U.S are not only adding up to the domestic energy security but also help to stabilize the oil prices across the globe.

An array of obstructions to oil supplies has emerged during last year.  These include widespread pipelines bottlenecking, unrest in Libya, and huge oil thefts in Nigeria and Syrian civil war.

Nevertheless, in spite of such happenings, oil prices have so far been quite stable.  The NCPA suggested that one of the main causes for this is that the market has been soften by the supply of North American crude.

Stabilizing Oil Prices Worldwide:

If what has been reported by NCPA is true then it means that oil and gas investment companies U.S.A have hugely assisted to uphold against all the incidents that would cause destabilization of oil prices globally.

Consequently, for those who have opted to invest in oil and gas companies has not only augmented U.S economy but also some or the other way benefitted the countries overseas by helping their infrastructures and industries to effectively keep running without being hampered by higher oil prices.

Improving the Economy Worldwide:
 
Well, the advantages of shale oil across the U.S for the civilians are pretty much known: it’s boosting employment opportunities, augmenting country’s economy and also making the nation self-reliant upon oil imports gradually. Consequently, it’s also helping the whole world.

Beyond a shadow of a doubt, U.S. oil production is boosting up economic growth in other nations by ensuring that they can regularly get sufficient supply of oil as well as the stabilized price.

Moreover, the increase in domestic oil production is projected to continue well into the forthcoming years; assisting the domestic circumstances and encouraging economies overseas.

Oil and Gas In The World Economy Infographic

Oil and gas is a prerequisite energy sources to keep the whole world running. Besides, global economy, one or the other way is largely influenced by these reserves. Every nation of the world makes its best to boost up their oil and gas production. In this run, Russia holds the topmost position in producing the largest amount of oil and gas in the whole world. Whereas U.S is the biggest oil consumer in the world, with china becoming the second –largest consumer!

Over and above, there exists huge investment opportunities in oil and gas companies with several benefits such as huge returns, beneficial tax reform laws, intangible drilling cost and so on. 

Let’s have a look through global oil and gas status. 

Why It’s A High Time to Invest in the US Energy?

These days, across Texas, there is absolutely a steadfast confidence taking place in American energy revolution. Certainly, an outstanding transformation is going on from prolific reserves to the richness of the energy.

Consequently, it’s almost all about gas and shale oil what is being talked generally. Texas has quite many oil-rich regions that have welcomed energy productions to boost up further. In fact, some of the western Texas and southern Mexico are plentiful of the energy resources.

Most of these areas are not new to the oil industry, as many companies have been into drilling business for over ten decades. During 1970, oil production reached 2 million barrels a day, but unfortunately went down to only 800,000 barrels a day in 2007. And such a huge downfall was not because the oil wells were dried up, but those companies could not find out more resource. But thanks to the latest innovations in shale technologies that have undoubtedly enabled shale oil production soaring up once more to 1.2 million barrels per day during last year.

‘Oil production is expected to increase more than double and that will produce more than 3 million barrels per day by 2025. And this upsurge in production will be as much as produced by Kuwait- the 3rd largest oil producer in OPEC. Moreover, natural gas in the Permian Basin is also projected to significantly soar up from 4.3 million cubic feet to more than 7 million cubic feet per day’, as projected by Tudor Pickering Holt & Co.

‘And when it comes to investment in oil and gas, Texas regions are the great spots nowadays’, said by Global Hunter Securities. So if you‘re investing in a reputable oil and gas investment companies, you stand a good chance to getting prolific returns.

So it’s a high time for the investors to make the most of the valuable energy gift this nation has. And probably, no savvy investors would want to overlook this opportunity.

Guide to Fracking- Oil and Gas

Fracking is also known as Hydraulic fracturing. It’s a process by which oil and gas companies stimulate the extraction of resources from the underground wells. 

The very first commercial application of fracking as a way to produce gas or oil took place either in Oklahoma or in Kansas in 1946. Since then, it has become a popular practice in this industry. Fracking has so far been used on more than a million wells worldwide.   

How does it work?

In fracking, a special pressurized liquid is injected- usually composed of sand, chemicals and waters-into an underground gas or oil-rich formation. This pressurized injection creates fractures in the rock which enables natural gas and oil to escape through an existing or new well.

Nowadays, fracking is quite common in shale formation. In the US and several other nations of the world, there is a range of underground shale formations that possess large amount of oil and natural gas.

Why fracking is needed?

Massive supply of oil and gas reserves is useless if it couldn’t be accessed. And fracking incredibly helps energy companies reach gas and oil reserves that would otherwise remain unused. Moreover, fracking also adds up to the life of older gas and oil wells that might have soon ceased production. 

Experts are of the view that within next decade, hydraulic fracturing will be indispensable to maintain 60 to 80 percent of all wells in the US in production.

Moreover Fracking is also combined with the horizontal drilling process, thus it’s even more effective way to take out fossil fuels.

A controversial method:

However, there are some issues regarding this method. Mostly, people are worried about the potential damage this method does to the environment.
The major issue is that this method contaminates drinking water supplies because it can be leaching poisonous chemicals and methane into the ground. 

According to a study, from the U.S. Department of Energy, fracturing and drilling a horizontal shale gas well can generally need anywhere from 2 to 4 million gallons of water. Contrary to this, the DOE has revealed that this amount is quite small compared to how much water is used in other industries such as agriculture.

Over and above, the fracking method also produces waste water that usually remains unused. And this adds up to the wastage of the water.

Between oil and gas fracking:

Generally, these two processes are quite alike. Some wells only contain oil, while others have oil, but there are also many reserves that include both fossil fuels.

However, the main difference is that most shale oil formations require being fracked only for once, whereas natural gas formations need multiple fracking processes to access the reserves.

Furthermore, according to EIA, there are fewer gas rigs in operation in comparison with oil rigs. As of Feb. 2013, there are only 426 natural gas rigs and1, 332 oil rigs existed in the US. Thereby, increasing the opportunities in investing in oil wells and making this industry –one of the best in keeping the world running!

Will Military Strikes in Syria Cause Higher Oil Prices?

As think-tanks in the United States and Europe contemplate launching military strikes in Syria, the unease in the country and the further instability in the Middle Eastern regions are impacting the financial markets.

However nowadays, the oil prices have soared up to a six-month high. Analysts from the bank Societe Generale hint that the oil price can finally increase to $125 if air strikes are released and $150 a barrel in the case if military stroke disturbs production in the region.

And this can go beyond all-time high of $147 a barrel noticed during the financial crisis in 2008. Bank of America Merrill Lynch has already predicted rise in the oil prices of $120-$130 a barrel- according to the report published in BBC news.

This is notwithstanding, de fecto that oil production in Syria is itself negligible to the global market. Moreover, even before the crisis that swallowing up the country now, Syria scarcely exported 150,000 barrels a day to foreign buyers-particularly the European Union. Even when sanctions were compelled on the regime of Bashar al-Assad in 2011, the oil exports were completely stopped and recently this country is estimated to produce only 50,000 barrels per day.

But the worry among the investors is that any Western connection in Syria can infiltrate neighboring countries into the fray and the contravention can spill out breaking the borders. And this can include neighboring Baghdad which produces significant 3 million barrels of oil a day- i.e 3% of global consumption. Unfortunately without any delay, local al-Qaeda activists have started operating in the northern Syria.

Alongside these, there is also concern over how Iran will react to military strikes. Because it has long been since Iran has supported Assad regime over the last two years, regardless of increasing international pressure and supporting financial and military supports. Supreme Leader Ali Khamenei of Iran has already proclaimed, ‘‘Western attack as a great disaster for the regions,’’ as published in BBC news. Even in the past, Iran threatened cutting off the oil supply if it was attacked by the United States or Israel.

Further it is also uncertain how major oil producers will reflect if western attack takes place. Because, Saudi Arabia has already stood up with Assad regime against all the rebels.

Even though the risk of military attacks, oil investing news summed up that oil prices has been creeping up for the time being, long before the warning of military strokes in Syria became an impeding possibility.

The consequences contained disruptions to production, especially in Libya where armed activists still control over the country. Similarly, the lack of security has witnessed oil production frequently disrupted, whilst industrial actions have barred exports at Libyan ports.

At the same time oil demands have stepped up as the United States and Europe recover from recession; additionally demand from China has also held up. However there are some analysts who are of optimistic views and suggest that if oil prices do rise extensively, the spike will be short-term.

List of Top 20 Leading Oil Companies in the World- 2013

Oil and natural gas companies have always kept the world running and will do so for many decades. Let’s see the biggest companies producing largest amount of oil in the globe.

1.Saudi Aramco - 12.5 million barrels per day
Saudi Aramco is the biggest energy company across the globe. It generates more than $1 billion revenues per day. Its Shaybah mega-project in Rub al-Khali desert, produce more than 15 billion barrels of oil. Moreover its biggest field, Ghawar, can produce 5 million bpd. 

2.Gazprom- 9.7 million barrels per day
Situated in Russia, this is the largest producer of natural gas in the world. The profits of Gazprom are more than $40 billion per year. The major business lines of this company are oil production, sales of gas, transportation, heat and electric power and geological exploration. This company is also accounted for 14% to 74% of Russian and Global gas output accordingly.

3.National Iranian Oil Co- 6.4 million barrels per day
Although Iran has been forced to limit its oil production due to some international authorization, it still remains as 3rd biggest oil and gas producers.  And to avoid such authorization, India and Turkey are paying Iran in gold for oil. Moreover, Iran has also threatened the world to stop its oil exports if attacked.

4.ExxonMobil- 5.3 million barrels per day
ExxonMobil is a multinational oil and gas company situated in Irving, USA. It’s a merger of Exxon and Mobil which took place in November 30, 1999. This company handles projects from the smallest to the huge units. It’s functionally organized into an array of global operating divisions.

5.PetroChina - 4.4 million barrels per day
It is the largest oil giant of China with its headquarter in Dongcheng District, Beijing. It has also has been the highest market cap of any of publicly operated giants. Interestingly, this company has already produced more oil than ExxonMobil and predicated to compete with Gazprom as the Chinese usually make the most and are much more concerned about their energy sources. 

6.BP - 4.1 million barrels per day
It’s a multinational oil and gas company headquartered in London. It’s one of 6th ‘oilmajors’. BP has integrated an array of areas such as production, exploration, refining, petrochemicals, power generation etc. Till date, it has been operating in 80 countries; producing 3.3 million barrels per day. 

7.Royal Dutch Shell - 3.9 million barrels per day
Commonly known as Ango-Dutch multinational oil and Gas Company is incorporated in the UK and headquarter in the Netherlands. Royal Dutch Petroleum and Shell Transport & Trading have been merged to form this company. By this summer, Shell is about to commence its drilling projects in Alaska’s Chuckchi Sea.

8.Pemex - 3.6 million barrels per day
Petróleos Mexicanos known as Pemex is the Mexican state-owned petroleum company. Its biggest field, Cantarell has soared up from 2 millions a day to approximately 600,000 now. Pemex is also the second largest enterprise in the Latin America. Moreover, the majority of its shares are directly under control of Mexican government.

9.Chevron - 3.5 million barrels per day
It’s an American energy corporation with it’s headquarter in California. It’s active in more than 180 countries. Chevron is engaged into almost all the aspects of oil and gas. In 2010, this company purchased Atlas Petroleum for $4.3 billion to avail acreage in Utica shales and Marcellus.

10.Kuwait Petroleum Corp- 3.2 million barrels per day
This company was basically formed in 1934 by BP and Chevron. Kuwait Petroleum Corp was nationalized in 1975.  Kuwait’s largest field, known as Burgan, is till being operated by Chevron. In 1990, Kuwait's fields suffered huge fires and were ruined by Saddam Hussein's forces.

11.Abu Dhabi National Oil Co. - 2.9 million barrels per day
In the league of UAE, Abu Dhabi holds a powerful seat.  It’s also known as ADNOC- one of the leading companies by oil reserves. It operates two oil refineries- Umm Al Nar and Ruwais. It is also developing both the offshore and onshore gas fields. Currently, it’s taking the benefits of the strategic position adjacent to the Strait of Hormuz to construct pipelines to Fujairah, mitigating any chance of getting its crude exports being blockaded by an Iranian cordon.

12.Sonatrach - 2.7 million barrels per day
Sonatrach is a national energy company of Algeria. It’s one of the leading natural gas producers and much of it is exported to Europe. It is engaged into an array of aspects from exploration to transport and refining.

13.Total - 2.7 million barrels per day
Total is a multinational integrated oil and gas company of France. The business of this company covers the entire range of gas and oil chain, from exploration, production to marketing.  Further, total is also a major chemical manufacturer. After the French president has enforced new taxes on oil inventories in July, the CEO of Total S.A declared that it’d cost them quite a lot.

14.Petrobras - 2.6 million barrels per day
Petrobras is a semi-public Brazilian energy corporation with its headquarter in Rio de Janeiro. In southern hemisphere it’s the largest company. Petrobras also stands as a leader in development of superior technology from deep-water and ultra-deep water production of oil.

15.Rosneft - 2.6 million barrels per day
Rosneft is a state controlled oil company of Russia. After buying assets of former oil giant Yukos, it has become one of the leading extraction and refinement companies. It carries out its gas and oil exploration throughout Siberia, Sakhalin, Timan-Pechora field and in some parts of southern Russia. Further, the president has enabled a joint venture between ExxonMobil and Rosneft to search Russia's giant oil-bearing shales and Arctic seas. 

16.Iraqi Oil Ministry - 2.3 million barrels per day
With its plenty of oil production, Iraq is further expected to be zooming up its rank to becoming oil giant especially with the help of its giant untapped fields.

17.Qatar Petroleum - 2.3 million barrels per day
Qatar Petroleum operated all the activities from exploration to transport and storage of oil and gas.  Moreover, the majority of Qatar’s energy production is natural gas which is shipped to many nations. Its largest gas field lies under the Persian Gulf. 

18.Lukoil - 2.2 million barrels per day
It was formed in 1991 by Vagit Alekperov- former Soviet deputy oil minister, who runs the company and possesses a 20 percent stake worth around $13 billion.  Its Russia’s second largest oil company headquartered in Moscow. In 2008, this company had 19.3 billion barrels of oil. Lukiol is actively operating in more than 40 nations across the globe.

19.Eni - 2.2 million barrels per day
Eni is an Italian oil and gas company and currently present in almost 79 countries. It’s also considered as Italy’s oil champion. Paolo Scaroni, CEO of this company has made a remarkable join venture with Russia's Rosneft and Venezuela's Pdvsa. Morever, in the regions of Iraq, Eni is escalating the huge Zubair field.

20.Statoil - 2.1 million barrels per day
It’s a fully integrated oil and gas company situated in Norway. It has operations in 36 countries. However, by revenue, this company has been ranked as world’s eleventh largest oil and Gas Company by Forbes magazine. In Statoil, government owns 67% of the shares. This company has further, invested around $20 billion in the United States.

Top 4 Facts You Should Realize About Oil

Oil is Vital. Incredibly vital
Economy of the whole world has been developing with oil as its important lifeblood. It’s in a straight line responsible for around 2.5% percent of world GDP and accounts 1/3rd of primary energy supply for human being.

Both oil and gas powers almost all the transportations across the globe. Except for some electric-powered means, you just can’t move over 25 mph with loads of weight without oil. Likewise, you can’t boost up economy; neither can propel modern military. And beyond a shadow of a doubt, the modern civilization will fall down if oil stops flowing. It’s hugely important for both the developed as well as developing world just as agriculture. That’s why oil is one of the most vital sources for the existence of human beings.
 
Perhaps You May Not Have an Idea- How Big Oil is?

Oil and gas transportation infrastructure is massively extended through shipping routes and pipelines. The pipelines of natural gas in the US alone can be stretched out to the Moon. There are millions of pipelines across this planet to distribute natural gas, crude oil and refined products.

There is around 40 percent of all seaborne cargo is oil. And total amount of oil transported via sea water is much higher than the total amount of fish biomass. And thus, the ocean is full of fish as well as oil cargoes.

On the other side, with the massive usages oil and gas constantly, it might become next-to-impossible in decades to come. They can be critical now, but feasible renewables growth may displace fossil fuels in the forthcoming generations. Solar and wind are hugely growing but oil is the only big source which can always do big things!

Also bear in mind that the energy production from oil alone is higher than solar or wind powers. The difference in power generation between oil production and solar power is more than the difference between Formula 1 racecar and a bicyclist. Even though solar power generation doubles each decade for over 100 years, it’d yet be quite far behind than oil today. Thus, to replace oil, you might need a whole century to allow the entire economy to be realigned and retooled by the new technologies.
 
Oil is Wealth For Everyone

The use of more-concentrated and cheaper energy sources tend to be great direct components of economic growth. Over and above, it always adds up to the improvement in the human condition. On the top of that abundant of energy resources can lift countries out of poverty. And undoubtedly, China figures out this very well. Any breakdown to secure energy resources and supplies can surely doom nations to fall down.

Energy efficiency is thus very powerful. But more than in most cases, increased energy efficiency actually cause larger energy consumption, because of less costs and faster economic growth. However, those of highly-developed countries can utilize sophisticated technologies to augment quality of life whilst using minimum energy.

Thus, oil is certainly high-quality energy. It can further easily be stored and moved. It’s also much cleaner than coal. Certainly, oil is the greatest wealth for any nation to sustain in this world. 

Oil Industry is a secure place to work

Thanks to the advancement in technologies and safety measures that have actually made it just right to work in oil rigs being quite safe. Although there is a wide range of hazardous activities involved at a drill site but all them are professionally managed. However, in the past working in the oil rigs were used to be quite unsafe. But the industry has made safety improvements in oil and gas equipments, atomization and also provides wide-ranging safety training. In fact, oil industry workers are also well-paid in the market worldwide.

By and large there are a whole lot of things to know about the oil industry. Many people spend their entire life in this industry. After all, it’s pretty essential to understand some facts about this powerful fuel that might help you to revalue it over and again and also augment your ideas for an informed investment purposes.

Who Are the Largest Consumers and Producers of Oil Across the Globe?

Ever since the horse and carriages had given way to cars, oil has been crucially important to the world economy. Since then, it has always been the major commercial energy source across the globe.  According to the EIA, recently the world is consuming 85.64 million barrels of crude oil per day- approximately equivalent to every single person using 2 litres of oil a day. Thus, the global oil consumption cost $4.3 billion each day.

USA is so far the biggest consumer of oil and gas. Even though there have been various discoveries in the energy sources, the consumption of conventional fuels is still far above the ground. Moreover, China is also listed as one of the major energy consuming countries even if it’s producing enough energy to meet its own needs, and that’s why it’s forecast as a powerful nation in world economy. According to annual statistical review, China is the second largest oil consuming country just after USA. 


Top 5 Largest Oil Consumers

 United States- 20.5 (millions of barrels per day)
 China- 6.5
 Japan- 5.4
 Russia- 2.6
 India - 2.3


Oil is the most valuable and usable source of energy across the whole world. There are many countries that have significantly effected by the developments and innovations in the oil market. Its demands and consumption is escalating day by day. In different countries, the production of oil also differs because of the natural resources’ availability and the techniques or technologies used. So let’s see the top oil producing nations in the world.


Top 5 Largest Oil Producers 


Russia- 10,730,000 (bbl/day)
Saudi Arabia- 9,570,000
United States- 9,023,000
Iran- 4,231,000
China- 4,073,000
 These five nations produce more than 40% of total world’s oil.


There has to be plenty of oil around for years to come. Moreover, oil resource base is not a constraint in the world, with regard to complying future demands. Over and above, there are yet plenty of crude oil reserves yet to be discovered. Its forecast that world’s proven crude oil reserves alone- i.e. more than 1000 barrels will meet the demands for over 45 years. Moreover ‘unconventional oil’ such as oil shale, tar sands etc. are also predictable to progressively rise in the coming years.

Along with these, since oil is a valued source for the global economy, it’s one of the most sought-after investment options. Besides, there are various tax benefits associated with oil and gas exploration companies in USA, investors are hugely making the most of them with an informed investment decision.

Oil and Gas Industry –Safe, Secure and the Richest

Probably, you may not get to know about this, but oil and gas companies USA, are one of the safest places in operation.  These industries have smartly introduced most advanced technologies and ideal protocols to alleviate any type of dangers to their workers. 

No doubt, there have been exceptions that have caused catastrophe to this industry but they’re extremely rare and certainly not at all pinpointing to the way the average industry’s energy projects are being operated.

Even visitors to an offshore drilling rig or at any of the production site are given safety training and also outfitted with safety goggles, hearing protection, steel-toed boots, helmet and gloves.  On the rig, all the safe practices are observed   and thereby reducing any danger to life, property, and the environment.

 In the past the accidents reported are Santa Barbara (1969), Deepwater Horizon (2010) and Exxon Valdez - thus, it shows that oil and gas industry is not risk-free.

Accidents do happen. Three incidents — Santa Barbara (1969), Exxon Valdez (1989), and the Deepwater Horizon (2010) — illustrate the oil and natural gas business is not risk-free. In fact, unexpected, disastrous incidents have caused huge public and private costs.  Bearing in mind all such loss, the oil and gas industry has responded to these failures by developing excellent technologies and enhanced safety systems. And thanks to these advancements as people working in oil and gas said, ‘‘we’re doin  alrite and gettin it right’.

According to the U.S. Bureau of Labor Statistics, reported in 2011- ‘ there were 2.3% accidents and illness per hundred oil and gas workers. That’s matched up to with 3.5 accidents per hundred for the whole private sector. And surprisingly, the US offshore industry has seen only 0.8 accidents per hundred regular workers.

In oil gas refining, there was only 1.1 accidents and illness cases per 100 full-time workers reported compared to 4.4 per 100 U.S. manufacturing industries on the whole.

Moreover, according to the data in 2011, U.S. pipeline transportation saw zero accident or injury compared to U.S. warehousing and transportation sectors.

US federal data also explained the improvements in spill rates.  Researchers ascertained that offshore spill rates were considerably very low even though the fact that Gulf of Mexico deepwater oil production had upsurged sharply over the year. 

Federal data also show improvements in spill rates. A 2012 Interior Department report examined spill records from 1996 through 2010 (the year of the Deepwater Horizon incident). Researchers found that offshore spill frequency was actually “relatively low” despite the fact that Gulf of Mexico deepwater oil production had risen sharply over that time.

Alas, environmental groups say no to admit that the oil and gas industry’s smart safety and environmental records are up to the mark. Frances Beinecke, president of the Natural Resources Defense Council, said that they require stronger safeguards and advanced oversight to mitigate accidents.

As we may know that the scalability, portability and density of coal, gas, and oil make them flexible, reliable and affordable for average consumers. Besides, solar panels and wind turbines are intermittent, inflexible and costlier and have their own safety issues. Moreover, there have been wind and solar-related injuries occurred to humans as well as thousands of birds were killed.

Alongside these, oil and gas industries generate huge amount of profits. In fact, the workers are well-paid in this industry. With oil and gas prices are soaring up these days, it’s becoming more and more valuable and certainly for those nations having these resources in abundance, will remain richest until they deplete. Thus, oil is as much valuable as gold and keeps the economy of the world running!

Gas and Oil Industries: Need to Consider Some Aspects

Climate Change


President Obama, in his recent speech addressed the immediate concerns over the climate change and encouraged sustainable energy as a prime goal for the country. Besides, EPA has already set out to emphasize on the regulation of greenhouse gases associated with gas and oil activities. A challenge for the oil and gas industry is to prove the government that the pubic and decision-makers have implemented the development of hydrocarbons that is compatible with low-carbon environment and so-called energy independence.

Oil Field Operations – Water and Air Pollution

‘Oil and gas operations in northeastern Colorado were noteworthy contributors to ozone last year.’ Besides the government has made the decrease of green-house gases as a main concern and EPA is also active to lead on emission policy. And in order to avail both the domestic and international favor for oilfield operations, this industry is expected to multiply its endeavors to successfully carry out all the operations that are environmentally friendly.

 

Water Use and Conservation

With the advancement of effective water conservation projects such as “rainy day” reserve fund- proposition for Texas, the EPA has been in the middle of its multi-year hydraulic fracturing study that is inspecting the affects of such fields operations on quality of the water. Consequently, such industry has planned out decrease of its water-use footprint in an array of operations and implemented observations of better engineering practices.



Tax Reform / Energy Tax Policy

Corporate tax reform in 2013,may include adjustments to the treatments of depletion allowance, intangible drilling costs and geophysical and geological amortization. All these tax adjustments, without deliberation of other variables, can portend a negative impact on investment and equities.



Overlapping regulatory environment for drilling and development of gas and oil reserves

The oil and gas industry might have to deal with overlapping regulatory challenges and regimes at all the levels of government body. Ultimately, 2013-14 is probably to define the federal government’s functions in regulating hydraulic fracturing and ecological impacts associated with shale development.

On the other hand, in the recent report, Energy Information Administration declared that domestic oil gas companies production is expected to go on the rise with the help of improved production technologies, particularly in shale formations. It further noted that crude production of US has witnessed its highest rise since the commencement of commercial oil extraction in 1859. Moreover, EIA indicated that oil imports will be mitigated with gasoline consumption and thereby using clean energy just to reduce more energy imports. Alongside, International Energy Agency also predicated that by 2020, U.S will become the largest oil producer across the world, with North America coming out a net oil exporter by 2030.

Thus, whatever may be the long run success of these industries, it’s hugely important to contemplate the aforementioned issues.

US Oil and Gas Will Further Soar Upwards For Over Years

According to the report on North America energy production, it is forecast that there will be healthy future for US energy, with faster growth led by tight oil, including huge oil production from an array of producers and other shale rock formations. 

Moreover the researchers also forecast- ‘despite the slumping prices of natural gas, the North US will double gas production by 2020.’ And almost all the Northeast shales haven’t not witnessed gas drilling decline even in the case of low cost of development. 

The researchers further estimated that this year $150 billion will be spent for developing North American gas and oil. And more that 40% of that spending will be accounted for tight oil. Alongside this, increasing numbers of oil and gas investors will push oil production to more that 5 million barrels a day by 2019. Also the growth in domestic crude oil will mitigate imports to just 15 % of U.S by 2020. 

Additionally, growth in oil sands crude from Canada can largely trim down imports from the Gulf regions. But this will further need new infrastructure such as rails and pipelines to carry the crude across southern regions. 

The upsurge in oil production is hugely making a difference in the energy market. This production has increased by a million barrels a day last year and consequently reaching its highest average per day since 1995. Further, US have been emphasizing the unconventional sources that have hugely increased the oil production between 2008 and 2012, reaching to almost 1 million barrels per day at end of the last year. 

On the top of that the demands of oil and gas is increasing over the years; resulting into triggered high prices. Besides, US is on the go to exploring large amount of energy resources and similarly employing new technologies and excellent methods of extracting oil and gas. Thus, it will see a substantial increase in the energy production in an age of years.

Guide to Investment Options in Oil and Gas Industry

Energy is a prerequisite for sustenance of life. The rising population of the world has led to high demand of energy worldwide. Consequently, the Governments across the whole world are passing through severe challenges for gas and oil production to meet the demand in their regions. Above all, this industry is extremely being transformed because of its valuable place in the world economy. Since it has become hugely popular among investors, they possibly run the risks to benefit from such a huge energy market. Ultimately, it has also become an interesting topic for analysis and research for the economists across the world.

So if you’re thinking of investing in this sector, you should have some ideas about the investment options available for you. However, there are many ways to invest in the petroleum industry, from retail investments to drilling projects for sophisticated investors.

Let’s have a look through these investment options so that you can make an informed decision:

1. Stocks in oil companies: It’s quite easy investment in stocks. Simply head to your broker and invest in the shares of the respective oil company. And depending upon the normal growth rate, choose a good option with the help of a good research work. Moreover since this investment probably subjects to risk, you just don’t want to make everything hastily.

2. Working Interest Partner in a Drilling Program: This investment as a working interest partner in several oil wells projects cash flow and tax benefits. However, there is a risk involved in such programs. But make sure that you’ve got enough cash to invest in various drilling programs. In addition to the income potential, oil investments offer extensive tax advantages (tangible intangible and percentage depletion allowance), and thus, the Government of U.S has set out to promote domestic drilling. Ever since the Tax Reform Act of 1986, these drilling programs in oil and gas are termed out as some of the best investments that may help investors to shelter income, making it a better tax advanced investment nowadays.

3. Existing working interest in a lease: Purchasing a working interest in an oil or gas lease is quite riskier than a drilling project. In this case, the potential for large unforeseen expenditure is reduced to a great extent. On the other side, the well’s production generally stays stable and the cash flow stream of the production is simple to evaluate. The ultimate benefit of buying a working interest is that it offers a superior return but as a drawback you still run the risk of lawsuits and regulatory compliance on the site accident. Alongside these, the biggest problem is the technical knowledge of the wells, decline curve analysis and several other technical knowhow.

4. Stock in royalty trusts: Buying stocks in any royalty firms is quite different that buying shares in an oil company. Royalty trusts are designed with large assets of royalty and prevailing interest. Moreover it’s trouble-free to find such investments as they’re available on the NYSE.

Oil and gas royalties direct from mineral owners: It has many benefits such as the returns can be higher at 12-50%, and buying royalties is like buying the minerals. And fortunately, if another oil zone is found out, then you’ll be enabled to avail another royalty cash flow stream. On the other side, you need to thoroughly understand ways to buy mineral rights. Then the other concern is to look for private owners who want to sell out. On the whole, due to higher returns and less risk, this has become one of the preferred investments in the oil industry.

So think over at your investment needs and opt for the investments that are ideal for you.