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07 29, 2015 by Houma Courier
Depending on which prediction you read, oil prices could be set for a rebound or headed even lower.
In turn, that could mean a healthy recovery for the local oilfield businesses and workers who have suffered a slowdown corresponding to the current downturn in prices.
Or, it could mean that the hardships that have hit our oil and service companies are here to stay, at least for the short term.
The predictions, though, are all over the map.
There is no telling which one will end up being accurate and, therefore, what the future holds for the local industry.
But there is at least one good sign pointing toward a healthier future for the local economy and all the businesses and jobs that depend on it.
Shell has announced it will move forward with its largest deepwater platform in the Gulf.
The project itself, named Appomattox, is estimated to cost in the billions of dollars.
But the total impact could be much larger.
"Appomattox opens up more production growth for us in the Gulf of Mexico, where our production last year averaged about 225,000 (barrels) per day, and this development will be profitable for decades to come," said Marvin Odum, director of Shell Upstream Americas. "With its competitive cost and design, Appomattox is next in our series of deepwater successes."
This is a great sign for us because it means that oilfield development in the Gulf isn't coming to a stop because of low prices.
Shell and the other companies that do business in the Gulf of Mexico realize that oil prices are cyclical and that regardless of the short-term predictions, which can be good or bad, there will be a return to enormous profitability.
"It's very encouraging especially in a time when we're seeing the decline the industry is in," said Louisiana Oil and Gas Association President Don Briggs. "The possibility that this is continuing, that's pretty big and it's a major commitment for south Louisiana. They wouldn't be doing it if they didn't think there was a light at the end of the tunnel."
That, ultimately, is the message we have to take from this announcement.
It is difficult to see workforce changes, and when local companies announce layoffs and slowdowns, those are things that can affect vast numbers of our friends, family members and neighbors.
The opposite, though, is also true. And this is a great example of some good news.
Editorials represent the opinion of the newspaper, not of any individual.
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