A volcanologist with the US Geological Survey, Ezra Yacob made a career-defining leap in 2005 when he joined Houston oil producer EOG Resources and its geoscience team at the start of the shale revolution.
“It was this real recognition that we are opening a new frontier in petroleum exploration,” Yacob said at a Hart Energy conference in Houston this week. “That really spoke to me.”
As Chairman and CEO of EOG, Yacob continues to focus on frontier exploration, but is moving internationally, particularly to the United Arab Emirates and Bahrain. While EOG remains huge in Texas and is leading a small oil boom in Ohio, the 20-year-old shale oil industry in the U.S. is maturing — but not declining. The thrill of the big discovery in the U.S. has mostly faded, so oil and gas players are increasingly focusing again on international exploration, including replicating shale drilling and fracking (hydraulic fracturing) techniques abroad.
“The international issue is probably at the forefront of everyone’s mind,” Yacob said. He said the geology of the Abu Dhabi shale is very comparable to the geology of the Eagle Ford shale in South Texas. EOG has brought a few wells online so far. “Right now it’s exceeding our expectations.” And everyone wants to “unlock the next new thing,” he said.
Despite the ongoing war in IranThere is optimism that the Middle East will recover, and countries are increasingly seeking help from American shale experts to develop more oil and gas reserves. The same is true in several South American and African countries, as well as Australia and even inland in Alaska. President Trump wants to extend the same sentiments to Greenland. If anything, the Iran war is pushing more countries to develop their own natural resources, both clean energy and fossil fuels.
While giants like ExxonMobil and Chevron never leave internationally Because of these developments, they have drastically limited exploration. In recent years, however, Exxon has turned Guyana into an oil power, and Chevron has fueled Kazakhstan’s growth. Chevron is also poised to take the lead Venezuela’s potential recovery. Exxon and Chevron are both increasing the international portion of their capital budgets for projects in the Middle East and Africa.
After years of reducing their foreign assets to focus on domestic shale, other leading shale companies such as ConocoPhillipsEOG, Occidental Petroleum, APA Corp., Murphy Oil and others are again exploring opportunities abroad — both on land and at sea. Harold Hamm’s, the country’s leading domestic private producer Continental resourcesis currently expanding in Argentina and doing business in Venezuela.
“I think international exploration is back in play,” said Bobby Tudor, founder and CEO of investment and advisory firm Artemis Energy Partners. “The desire to look beyond the conventional core business of the USA has increased, and increased significantly.”
Dusk to dawn
If anyone knows the development of the slate industry, it is Tudor. His investment firm Tudor, Pickering, Holt & Co. helped finance much of the boom and successfully identified the direction of the oil and gas industry.
While the U.S. shale sector may not be quite at twilight yet, he said, there is only room for much more growth, and that is definitely not enough to fill the global demand gap that will widen again after the Iran war. The U.S. industry is in mature consolidation mode, not booming growth.
Tudor expects exploration to increase significantly in the Western Hemisphere from Alaska to Argentina, and South American governments are trending toward a more pro-business stance.
“The pull to America, particularly in light of this war, is actually quite dramatic,” Tudor said, arguing that the region can provide reliable and affordable energy to the world.
Still, Tudor said, the frontier oil and gas industry has largely fallen out of practice after two decades of drastically reduced exploration efforts. Many workers in the oil and gas industry “have never drilled a dry hole,” he said. They have never run a real wildcat before.
“The U.S. exploration memory was eroded, quite severely during the shale revolution,” Tudor said. “There’s a lot of muscle memory that needs to be rebuilt in the industry.”
Bill Armstrong, 66, would agree. Armstrong, a geologist and CEO of the eponymous company Armstrong Oil & Gas, is a true tomboy and pioneer of Alaska’s North Slope and has made several major discoveries over the years, including the Pikka field, about which he remains optimistic. He compares it to the original East Texas oil field that boomed nearly a century ago.
“Hardly anyone does what I do anymore,” Armstrong said.
And he’s not slowing down now. Much of the seismic geology in Alaska’s eastern North Slope is “beautiful.” And he is preparing to drill new wells. “It’s like geo-porn,” he said of the seismic images. “There are endless possibilities. Virtually no fracking has been done in Alaska.”
Armstrong also has his sights set on Venezuela and the coast of Aruba – adjacent to Venezuelan waters. From Alaska to Venezuela, these are areas that are being pushed hard by the Trump administration.
“This is real wildcat,” he said of Aruba, noting that only one other well has been drilled there so far.
“Chasing the next big thing is still what excites many in the industry,” said EOG’s Yacob. And EOG is known as an innovator and trendsetter in shale technology. Where EOG goes, others usually follow. Although EOG is not a household name, it is revered in the industry and was considered the one a decade ago Apple of oil and gas.
Yacob said EOG would not target the UAE and Bahrain unless they had done their due diligence and established the appropriate trust. Finally, he said, “Going international isn’t easy. Going to South Texas is easy.”
But the pursuit of a discovery was his calling, he said, and what drew him to the industry.
“Think about what we have to do every day. You come in with a map and limited data sets and have an idea of something that’s 2 miles below the Earth’s surface,” Yacob said. “You basically stick a straw in and you can test your idea and you get pretty instant results. It’s the most exciting industry I could ever imagine.”