By JOHN P. TRETBAR
The world’s two biggest oil exporters agreed Monday to extend their production cuts for several more months. Saudi Arabia and Russia announced Monday they would extend the cuts through next March, and analysts say OPEC members could follow suit when they meet May 25th.
We couldn’t help noticing a story out of Oklahoma last week that might seem a little rank, but also just a wee bit obvious. The Tulsa World newspaper reports a pair of companies getting creative in efforts to secure water supplies for hydraulic fracturing. They’re using treated wastewater from local sewers for fracking. The Mayor of El Reno told the paper “as long as we’re flushing the toilets, we can supply water to the energy industry.”
There were 30 new well completions over the last week. There were 15 well completions in eastern Kansas and 15 west of Wichita. There were three in Russell County including one dry hole, and one each in Barton, Ellis and Stafford counties.
There were 46 permits filed across the state for drilling in new locations last week. That’s 533 so far this year, and a fairly dramatic improvement over the total of 279 last year at this time. There were 32 permits filed east of Wichita and 14 in western Kansas. There was one new permit filed last week in Barton County and two in Ellis County.
Baker Hughes reported 885 active drilling rigs across the US including an increase of nine rigs drilling for oil. In Canada there were 80 active rigs, down two for the week. Independent Oil & Gas Service reported a slight increase in the rig counts in Kansas. There were eight in the eastern half of the state, up one, and 23 west of Wichita, also up one. In Russell County, they’re drilling at one site, preparing to spud at another and moving in completion tools at three more. Crews are moving in completion tools at two sites in Ellis County, one site in Russell County and two in Stafford County.
According to the latest monthly numbers from the Independent Oil & Gas Service, a whopping 28 percent of the new well completions in Kansas last month were dry holes. This hits close to home as well. Of four completions in Barton County last month, two failed to produce pay dirt. In Ellis County there were two dry holes out of four completions. Russell County reported one completion, which was a dry hole, and both of the completed wells in Stafford County last month were dry holes. There were 57 completed wells in eastern Kansas, including eight dry holes, and 64 west of Wichita with a whopping 27 dry holes. Independent Oil & Gas Service reported 121 newly completed wells statewide last month. That’s 470 total through April.
Producers filed 92 drilling permits across Kansas last month. The total is 475 permits through April. There were 30 permits for new locations east of Wichita, and 62 in western Kansas. Barton County reported four new permits, Russell County had five and there was one in Stafford County.
A stalemate in the Oklahoma Legislature increases the odds of a special session in OKC. The fiscal year begins July 1, and the state Constitution requires the Legislature to adjourn May 26. There is no agreement how to fill an $878 million hole in next year’s state budget. The governor has vowed to veto any budget that includes dramatic cuts to vital public services. Republicans last week pulled a bill encouraging so-called long-lateral drilling, after Democrats insisted that it be linked to an increase in the state’s gross production tax on oil and gas production. According to local news accounts, neither side is optimistic.
Canada’s largest oil and gas producer is hoping to start building a new oil sands project later this year in Alberta. Suncor’s Web site says the Lewis Project would increase the company’s production by up to 160,000 barrels per day. Suncor says it is considering use of vaporized solvents and electromagnetic heating to replace steam, and use less water and energy.
There’s yet another petroleum scandal involving a US firm under investigation in Nigeria, once our seventh-largest source of oil. The Nigerian Senate today indicated its readiness to investigate Chevron over alleged fraud to the tune of more $4.9 billion dollars. They’ll investigate alleged tax evasion and other financial chicanery.
The Brazilian-owned refinery in Pasadena, Texas is once again under scrutiny, after it was offered for sale at pennies on the dollar. Petrobras bought the refinery for $1.2 billion, but has now offered it for sale for $200 million. The acquisition was already being investigated by federal prosecutors, who say the refinery cost many times what it was worth and that bribes may have been paid as part of the purchase.