Good morning, here's what the Oilman has for you today:

• Conoco Begins Work on Willow Project

• Shipping Trouble Expands with Drone Attack on Tanker

• Upcoming Oil and Gas Events

• Tweet of the Day

Conoco Begins Work on Willow Project

Conoco has given the final green light to the most controversial oil project in recent history.

The Willow development in Alaska will cost $8 billion and produce 180,000 bpd of crude.

A win for Alaska and energy security

The Willow project has reserves of some 600 million barrels.

It will generate revenues of between $8 billion and $17 billion in revenues for the state.

The state of Alaska really wants Willow.

Production of oil there has been in a steady decline for years.

However, some Indigenous groups have been opposing it.

So have environmental organizations. It’s their business to oppose such projects.

Amazingly, the Biden admin actually approved Willow.

And the opponents’ lawsuit flopped.

Willow is going ahead.

Drilling on federal lands: the new ultimate challenge

The Biden admin may have greenlit an oil project and scored some common sense points.

But the Interior made sure to also put 16 million acres of Alaska land and waters off limits for drillers.

It was meant to appease activists.

But it also signals how hard new drilling on federal lands is going to get.

If the current crop of politicians stays in power, that is.

Just look at the last GOM lease sale: there won’t be another one until 2025.

It’s a squeeze on the industry with any means available.

Good thing that most oil-rich rock is on private land.

Tough luck for places like New Mexico, where a lot of drilling is on federal land.

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Shipping Trouble Expands with Drone Attack on Tanker

A drone has hit a chemicals tanker off the Indian coast, extending the area of unsafe shipping.

According to the Pentagon, the drone was sent from Iran.

Just when things were getting better in the Red Sea

The report of the attack comes on the heels of news that Maersk was returning to the Red Sea.

The shipping giant’s decision followed the launch of Operation Prosperity Guardian.

It involved several NATO members stepping up their presence in the area.

An expected response to the Yemeni Houthis’ attacks on ships.

The attacks quickly chases away all the big shipping companies.

And added millions to the cost of shipping transport.

Because ships were forced to go all the way around Africa to avoid the Red Sea.

The Indian Ocean attack suggests that it might not all be over by Christmas.

The tanker was 200 nautical miles off the Indian coast when it got hit.

That really extends the range of possible targets.

Supply chain disruptions and unstable oil prices

Longer trips for ships mean supply delays for hundreds of goods.

Just when supply chains were getting mended after the pandemic, no less.

So unfortunate.

But continued attacks also mean higher volatility for oil prices.

After all, Prosperity Guardian was launched after BP said it wouldn’t ship oil through the Red Sea.

For a group so committed to the transition, the G7 responded very quickly to the oil supply threat.

The question is, will that be enough? The Indian Ocean attack says probably not.

Upcoming Oil & Gas Events

• January 16: TIPRO/IPAA Leaders in Industry Luncheon, Petroleum Club of Houston, Houston, TX

• January 17: IPAA Private Capital Conference, The Post Oak at Uptown Houston, Houston, TX

• January 17-18: GO-WV Winter Meeting, Marriott Town Center Hotel, Charleston, WV

• January 18: Kansas Oil and Gas Day Legislative Reception, Kansas State Capital, Topeka, KS

• January 23-25: POWERGEN International, Ernest N. Morial Convention Center, New Orleans

Around the Global Patch

🇺🇸 Empowering energy: the ascendance of 3D printing.
🇨🇳 Nguyen's leadership in Wison's decarbonization journey.
🇦🇪 LNG milestone: Adnoc's Ruwais project secures a sale deal.

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