November 26th, 2018
Baker Hughes reported 1,079 active drilling rigs across the U.S. last week, a drop of three oil rigs. North Dakota and Texas were both down three, Louisiana was up four and New Mexico increased by three rigs. Oklahoma was down two rigs for the week. Canada reported 204 active rigs, up seven for the week. Independent Oil & Gas Service reported 15 active rigs in eastern Kansas, which is unchanged, and 33 west of Wichita, which is down one.
Operators filed 30 permits last week for drilling at new locations across Kansas, nine east of Wichita and 21 in Western Kansas, including two in Stafford County.
Independent Oil & Gas Service reported 45 new well completions last week, 1,396 so far this year. There were 11 in eastern Kansas and 34 west of Wichita. Three completed wells were reported in Barton County, two in Ellis County, and one each in Russell and Stafford counties.
The government said U.S. crude production continued to rise from record levels, last week topping 11.7 million barrels per day, an increase of four thousand barrels per day over the week before. The U.S. Energy Information Administration reported inventories increased by 4.9 million barrels, and are now about six percent above the five-year average for this time of year.
North Dakota reported another crude-production record in September, 1.36 million barrels per day according to preliminary numbers from the state. But officials say those numbers could go down over the next three months or so, because of low oil prices, and the state’s disappointing gas-capture efforts. The state has decided not to change the scheduled increases in gas capture goals, and instead offer flexibility to operators in their efforts to meet them.
A judge in Oklahoma denied a motion to dismiss an earthquake lawsuit against producers in Oklahoma, but refused to give the suit class-action status. The Journal-Record reports said some clients will have to refile if they want to proceed with their damage claims. Plaintiffs attorney Scott Poynter said he was pleased that the judge denied motions to dismiss the case, but said the potential plaintiffs in the class should file individual petitions soon if they want to protect their rights under statutes of limitations laws.
U.S. liquefied natural gas exports are booming, and some new export facilities are in the works. Cheniere Energy officially opened its $15 billion facility in Corpus Christi, Texas earlier this month. The company won’t say when the first cargoes will set sail, but Reuters reports an LNG vessel currently docked at the plant was expected to take its first cargo soon. Corpus Christi is the third big LNG export terminal to enter service in the lower 48 states.
In Texas producers are worried about infrastructure and personnel. More than a dozen top U.S. energy companies have pledged $100 million toward easing stresses on health care, education and civic infrastructure from the shale oil and gas boom in West Texas and New Mexico. Pioneer Natural Resources is spearheading an effort called the Permian Strategic Partnership. Company CEOs warn that if worker shortages, road problems, healthcare and housing aren’t address soon, Permian development could be stifled.
Some pipeline relief is in the works in North Dakota, but it will be over a year before it bears fruit. Phillips 66 and Bridger Pipeline announced plans for a new pipeline to send Bakken and Rockies crude oil to Texas. The firms announced a joint open season for the proposed Liberty Pipeline, which, if approved, could move some 350,000 barrels per day by the year 2020.
The Oklahoma Supreme Court sided with the state’s oil and gas industry in a dispute over what kinds of water can be transported through temporary lines the county permits in ditches along roadways. The high court said Kingfisher County may not issue rules against moving only drinking water, and not produced wastewater, through those ditches. The court agreed with the industry’s assertion that state law gives state regulators the exclusive authority to regulate oil and gas activities.
Alberta gives carbon-tax breaks to oil and gas drillers, and a tongue-lashing to the national government in Ottawa. Premier Rachel Notley announced her government in Alberta will add oil and gas drilling to a list of trade-exposed industries exempt from the province’s carbon tax. The move is expected to provide $750,000 to $1.5 million per year in relief to the drilling industry. Notley later criticized a fiscal report for underplaying Western Canada’s oil price crisis, blamed on insufficient pipeline capacity to take away a glut of crude trapped in Alberta.
The boom continues in New Mexico, where the State Land Office announced a record for its monthly oil and gas lease sale, generating This month’s sale represents the highest single-month yield in the agency’s history more than $43 million for public schools and other trust land beneficiaries. The previous record of just over $30 million was set in July of last year.
Regulators in Alaska say the state held another record-breaking lease auction for oil and gas rights. The Alaska Division of Oil and Gas received 159 bids totaling $28.1 million for properties on the North Slope, the foothills, and the Beaufort Sea.