Is an Oil Pipeline Planned in Oklahoma? By Brandon Davis

Is there an oil pipeline that is being planned for construction in Oklahoma, asks Brandon Davis of Swan Energy. According to KOCO in Oklahoma, three oil companies are planning a large scale pipeline that will provide the capacity of over 130,000 barrels daily transportation from multiple locations within the state. The pipeline is expected to connect to Cushing, OK, where there is a 1 million barrel oil storage terminal. Cushing is the largest US oil storage facility with an operational capacity of over 66 million barrels as indicated by the US Energy Dept.

The pipeline will provide jobs to the region and add to the ability to transfer larger volumes of crude oil from the Oklahoma oil fields to market. Production is expected to begin in this summer. For more information on this new pipeline development and construction, please read it here and here as well.

 

Swan Energy completes another oil drilling at Boo 1-9

During the month of January, Swan Energy has set a goal of drilling 3 wells of the 22 wells it plans to drill this year. The Boo 1-9 is the 2nd well for the month of January. The first well was Moore 1-9. The Boo 1-9 oil project is a Three Tier Joint Venture well.

Click here for a full drilling update video from Swan Energy.

 

John Schiffner and Swan Energy Raise Another Oil Derrick

John Schiffner and Swan Energy raise another derrick, called Moore 1-9 this January, 2012 as Swan Energy Inc continues to explore and produce domestic energy opportunities in the United States.

This time-lapse video shot this month showcases the process and production involved with raising a derrick prior to drilling on this site.

 

Swan Energy explains the difference between WTI and Brent oil

Many people do not realize that the oil Swan Energy pulls out of the ground in Oklahoma has different characteristics than the oil that comes from the Middle East or Canada.  There are two factors that generally define the characteristics of oil that create these differences.

The first factor is called API gravity.  API stands for American Petroleum Institute.  This is a statics that is used to measure how heavy or light petroleum liquid is   compared to water. If the API gravity is less then 10, it is heavier than water and sinks; if the API gravity is greater the 10 then its lighter than water and floats above water.  API is measured in “degrees”.  Most petroleum values fall between 10 and 70 API gravity degrees.

Generally oil with an API gravity between 40 and 45 commands the highest prices.   Oil that has an API above 45 degrees is less valuable to refine because of the changes to the molecular structure.

The API gravity from the oil that Swan Energy (http://swanenergyinc.com) is currently pulling out of its wells in Oklahoma is about 38.00 to 42.00 degrees.

There are three main classifications of oil based on API Gravity:

• Light crude oil: API gravity greater then 31.1 degrees
• Medium crude oil: API gravity between 22.3 and 31.1
• Heavy crude oil: API gravity less then 22.3
• Extra heavy crude oil: API gravity below 10.00

There may be some differences in grading from party to party, but this will give you a good baseline to conceptualize the grades of oil.

The second factor is how sweet or sour oil may be.   This is based on the sulfur content of the petroleum.  Petroleum is considered “sweet” if it contains less then 0.5% sulfur.  “Sour” oil refers to petroleum contains more then 0.5% sulfur.

The term “sweet” comes from the nineteenth century prospectors that would taste small amounts of the oil to determine its quality – the low level of sulfur provides the oil with a mildly sweet taste and pleasant smell.

Sour oil is much more widespread than sweet oil.  Sour oil is found in Canada, the Gulf of Mexico, parts of South America as well as most of the Middle East.  Sweet crude is more commonly produced in the Central United States, most of Africa, the Asia Pacific and the North Sea.

Sweet crude is preferred because it takes less processing in order to remove impurities.  Light sweet crude has the highest demand while heavy sour crude is traded at a discount.  The oil that Swan Energy is currently getting out of Oklahoma is considered Light Sweet Crude.

Using these two factors, oil is then priced on the world market using the different types of oil.   There are two major benchmarks for world oil prices:  WTI crude oil and Brent crude oil.  While both are light sweet crude oils, historically WTI trades at a premium (by just a few dollars a barrel) because it is generally lighter and sweeter. Swan Energy sells the oil produced by the Joint Venture wells using the WTI index not the Brent index.

In 2010, for the first time, this changed and now WTI is trading below Brent by as much as 20%.

The variance between WTI and Brent began at the end of 2010 and was accentuated in February of 2011.  There are two main factors contributing to this.  First are the Libyan crisis and the Arab Spring, which decreased supply of light sweet crude to Europe.  The second, which may be more long term then the Libyan crisis, is the oversupply at the main storage facility in Cushing, Oklahoma.

As the new pipelines from Canada came online along with oil production increases in North Dakota and Colorado combined with  the two pipelines sending oil up from the Gulf resulted in the Midwest refiners being oversupplied with oil.   What also may be a factor is the oil coming from these areas may not comparable in quality to the light sweet crude oil from the Midwest.  These factors are all playing a part in creating a large delta between Brent and WTI.

There are some analysts that believe that market manipulation may be playing a factor as well.   The bottom line is that we will have to wait and see what happens as the crisis in Libya settles down and as more and more oil coming form Canada and North Dakota is being transported by truck and train to the Gulf.

Ultimately, demand remains high and while we may see short term increase in supply, oil supply is still diminishing world wide and this will continue to keep oil prices high – as evident by the increasing WTI prices as it closes the gap between Brent and WTI at the end of October and beginning of November.

 

Swan Energy – What is Missing from Obama’s Job Plan?

In the beginning of September President Obama addressed Congress with his $447 billion proposal to get Americans back to work and pleaded both the House and the Senate to pass it right away.

However there was an oversight that should have played an important component to his job plan – American Energy.

American independent domestic oil and gas producers are the backbone of the energy industry.   These independent producers, like Swan Energy, develop 90% of the oil and gas wells in the United States.  These wells produce 68% of the oil and 82% of the natural gas in America.

As President Obama crisscrosses around the nation selling his job plan amidst the high unemployment and economic woes, the independent oil and gas producers are quietly contributing to the job growth.

According to the President of the Independent Petroleum Association of America (IPAA), in 2010 independent oil and gas companies (like Swan Energy) accounted for almost 4 million jobs. That’s an outstanding 3% of all jobs in the United States!

Instead of promoting this incredible job opportunity that only could strengthen our country’s policy and also decrease our reliance on the foreign oil, Obama’s plan puts its crosshairs the oil and gas industry by the mischaracterized  “tax loopholes” for the oil and natural gas companies by wanting to kill the historical tax structure that has promoted industry investing by independent producers and independent investors that are willing to take the high risk of oil exploration and production. These so-called “tax loopholes” have promoted American job growth for decades.

If we look at the industry as a whole, going beyond the independent oil and gas producers, America could see significant job growth.  According to William O’Keefe, CEO of the George C. Marshall Institute, “President Obama’s decision to omit traditional energy from his jobs plan conflicts with his own administration’s data.   Labor Department figures show that the oil and gas industry has been creating jobs as the economy has been losing them.”

Look at the chart below that was released by the U.S. Labor Department this year, since 2007 the U.S. has lost 5.7% of its jobs, while the oil and gas industry has gained 16.9%.  Swan Energy believes that with the oil and gas boom that we are seeing throughout the U.S. we could see significant job growth in 2012.   Job growth in the oil and gas sector increased about 200% in less then a year in 2011.  It is not unreasonable to infer that we could see this same trend next year.

What would happen to job growth if the hostility towards oil and gas exploration and production is reduced?

Swan Energy was astonished to discover from the IHS Global Insight-CERA findings that just a single year measure to increase the pace of federal permitting for oil and gas producers could generate:

• 230,000 American jobs
• Over $44 billion to the U.S. GDP
• Nearly $12 billion in federal and state tax and royalty revenues.

All of this without the $447 Billion price tag.

 

Current Improvements In Oil And Gas Industry by Swan Energy

Around 40 percent of coal generation plants either tend not to fulfill the new U.S. Environmental Protection Agency (EPA) criteria of formidable limitations on mercury, sulfur and NOx or are 50 years or older; this opens the door to recent new developments in gas and oil technology that could take the place of coal production for U.S. energy consumers

In the foreseeable future Swan Energy thinks that Americans are going to turn toward gas generation simply because gas factories will be less costly to assemble, less costly to run (at projected gas prices), and regulating approvals for new construction will be less complicated to obtain.

More power generators utilize gas for electrical energy, escalating the American need for natural gas. Engineering has enabled the drilling of natural gas from shale and various other formations found in large proportions throughout the U.S.

The exploration and development industry of gas and oil has improved operations and raised the size of American resources since 2006 by 39 percent, making the exploration and generation of natural gas more efficient, risk-free and ecologically favorable.

New oil and gas improvements in technologies include 3-D and 4-D seismic imaging, CO2 sand fracturing, coiled tubing, measurement-while-drilling (MWD), slimhole drilling, and hydraulic fracturing. 3-D and 4-D seismic imaging mixes seismic imaging techniques with personal computer processors to create either a three-dimensional or four-dimensional time model of the subsurface levels facilitating the recognition of deposits

One way that can help oil and natural gas to circulate more openly via larger cracks in the earth is to utilize a mixture of sand proppants and solution called CO2 sand fracturing.

Coiling tubing takes the place of the traditional rigid drill pipe with an elongated coiled pipe string that bends very easily to reduce oil-drilling costs. MWD systems assist in the collection of data from the bottom of a well during drilling and supply technical engineers and drilling teams with up-to-date data with regards to the dynamics of rock clusters. Drilling a slimmer hole in the ground to get to gas and oil deposits is referred to as slimhole drilling. Hydraulic fracturing is used to free natural gas caught in shale rock clusters and over 90 percent of U . S . gas wells utilize it to boost production. Colorado gas exploration pioneers utilize the environmentally friendly technique of drilling 15 or more wells from a single pad. This engineering decreases the traffic affiliated with pump trucks, proppant delivery and water removal along with improving upon the way that water is dealt with.

All these latest innovations in the oil and gas industry, along with the more challenging restrictions the EPA is leveling on coal plants predicts a bright future for nationally acquired and developed oil and natural gas; America’s need for a reliable energy source for the long term might have been discovered right under our feet.

 

What is Direct Participation in Oil and Gas? by Swan Energy

Direct participation in oil and gas is not about buying stock options in gas and oil organizations or investing in general public businesses

Direct participation in the industry means that a trader or participant places their money into an endeavor which is going to get out there and drill a specific number of wells (these projects may include more than one wells) with the intent of these wells generating oil and/or gas that will then deliver income back to the investor.

This illustration by Swan Energy shows how direct participation in oil and gas works:

Direct Participation in Oil and Gas explained by Swan Energy

The income out of the manufacturing goes back to the enterprise and spread out to the participants proportionate to their Working Interest (minus taxes, charges, running cost, etc.).

Working interest is the term for primary liable portion of the ongoing expense associated with research, drilling and processing. Working interest owners furthermore completely engage in the earnings of any prosperous oil or gas wells.

An oil well at dawn

It is essential to take note that when anybody looks at taking part in a working interest endeavor they need to additionally be certain that the enterprise has a turnkey agreement so that they recognize what their charges is going to be up front.

These beforehand costs generally consist of research, drilling and assessment. Presently there may also be supplemental opportunities that will change from well project to well project. Fracking, pump jacks, and storage tanks are typical illustrations of typical additional expenses that are allotted to the participants. Make sure that you comprehend the financial requirement before getting engaged in a Joint Venture.

The notion of developing relationships or Joint Ventures to develop company connections has been all around for centuries. There are numerous distinct kinds of entities for direct participation in gas and oil undertakings; the most typical are Limited Liability Partnerships and Joint Ventures. A video presentation contrasting Limited Liability Partnerships and Joint Ventures in relation to direct participation in gas and oil undertakings may be found at Swan Energy’s web page.

If the endeavor is a Joint Venture (the entity that Swan Energy employs), there are two main functions that are important to understand. The very first role is the investor or participant. The participant puts up cash in return for Working Interest in the venture.

The next role is the managing venturer. The managing venturer runs the daily operations of the endeavor which might consist of, but is not limited to, developing the endeavor, managing the drilling and operations of each and every well, holding conference calls, dealing with any concerns that might come up, and controlling the financial aspect of the enterprise including obligations on oil and gas income back to the contributors based on profits which can be obtained from the production of each and every well.

In a Joint Venture, the participants have the command and make the judgements of Joint Venture. The Managing Venturer then implements these choices. In fact, the participants can substitute the Managing Venture with a simple majority vote

To illustrate, the contributors have the control to decide whether to cap a well or go to completion on a well. A lot of investors like this sort of oversight and control with their investments.

With any direct participation in oil and gas ventures comes risk. There’s constantly the chance that as soon as a well is drilled and tested that there’s no gas or oil found.

Swan Energy uses the Joint Venture structure to satisfy the targets of the participants in our programs to:

1. Supply cash distributions from operations
2. Provide increased tax benefits
3. Place control of the operations and management of the oil and gas program in the hands of the participants.

With oil extraction costs between $8 to $10 per barrel and each barrel selling north of $80, Swan Energy thinks that it doesn’t take an engineer to figure out that the oil market is positioned to see high profits that may be made at the original source for unbiased investors by participating in oil wells directly.

 

Swan Energy of Denver, Colorado Embraces Technological Advancements in Petroleum Production

From 2010-09-17

Swan Energy of Denver, Colorado, eyes technological breakthroughs in petroleum production.

Laser drilling, as a new technology, proves to be advantageous over traditional methods. It allows drilling on the surface area several times faster than conventional drilling rigs. Initial research and tests have proven laser drilling to be potentially highly effective that it is even dubbed as the possible answer to making uneconomic oil reservoirs commercially attractive.

From 2010-09-17

Since laser technology has the ability to penetrate rocks faster than usual techniques, it reduces the costs of operating drill rigs. A typical on-shore site costs an estimated $400,000 to drill, though the cost may increase depending on the terrain. Laser technology gives lower costs since the time to use a drill rig is lessened.

Swan Energy of Denver, Colorado, believes that the reason laser drilling may be faster than traditional options is the laser’s ability to cut through rock without physically contacting the surface. This saves operators the time needed to replace a mechanical part once it becomes worn out or broken by the constant grinding against rocks.

From 2010-09-17

Aside from faster digging, laser technology also creates a ceramic sheath to eradicate the expense of purchasing steel well casing. It is able to correctly predict the amount of oil through visual imaging systems and other downhole sensors.

Laser Drilling is still in its infancy research and development stages.  As this technology is being developed, Swan Energy looks forward to the positive impacts that it will have on the industry.

More information about Swan Energy may at viewed at www.swanenergyinc.com.

 

Swan Energy Advocates Green Power

From Swan Energy, Inc.

Nowadays, the slide towards global warming may be inevitable. But there are still ways to delay it. Swan Energy is such an advocate of this belief that it continues to develop fuel domestically to lower pollution levels and oil spills in the country.

From Swan Energy, Inc.

This oil and gas producer is committed to finding and developing petroleum-rich locations throughout the nation. By producing petroleum domestically, the firm believes that the country can make strides in meeting its demand for domestic oil and natural gas resources. Since fuel is created on-shore, there are lesser oil spills because the need to transport oil through the ocean is diminished.

From Swan Energy, Inc.

Swan Energy also  develops natural gas reserves which lets gas burn cleanly with minimal ash residue in the atmosphere. This clean oil and fuel slows down the ozone depletion and population levels in the country. Carbon dioxide emissions alone are lowered due to the nominal oil transport activities via the sea.

Swan is dedicated not only to producing oil locally, but also to creating natural, and clean oil alternatives for a better environment and country. More information about the company and its uncontaminated fuel are found at www.swanenergyinc.com.

 

Swan Energy, Inc. Helps Alleviate America’s Dependence on Foreign Oil

From Swan Energy, Inc.

Swan Energy, Inc., an independent oil and natural gas producer based in Denver, CO, is in the forefront of the search for domestic petroleum resource for the country. Specializing in the acquisition of petroleum-rich areas in the continental United States and their development into viable drilling fields, Swan Energy is gearing towards the country’s self reliance in energy resources.

The numbers clearly show it. According to the US Energy Information Administration (EIA), the US is the second biggest consumer of petroleum using up to 22.6 bbl/year per capita in 2008, but was only third in production at 8,514 103 bbl/d in the same year. Furthermore, the US EIA reports that the country imported an average of 12.220 103 bbl/day or 1,943 103m3/day in 2006 to address the large demand for petroleum.

Of the total US petroleum consumption, approximately 70% goes to transportation, the 30% to the industrial industry (23%), residential and commercial sector (5%), and electric power (2%). If the country can increase the domestic petroleum supply and depend less on foreign import, the price of gasoline will significantly decrease for the everyday consumer. Independence from foreign oil import also means more room for the government to pursue its own political directives.

From Swan Energy, Inc.

Swan Energy, Inc. is investing in the acquisition and development of domestic petroleum resources.

More information about Swan Energy and its services may be found at SwanEnergyInc.com.

From Swan Energy, Inc.