By JOHN P. TRETBAR
About eight years after the company declared bankruptcy, costing Kansas oil and gas producers millions of dollars, SemGroup is shelling out more than two billion dollars to purchase Fuel Oil Terminal Company, one of the largest oil terminals in the US. The Houston Chronicle reports the deal includes the company’s prime waterfront acreage along the Houston Chip Channel. The price includes $1.3 billion in stock and cash, plus the assumption of almost $800 million in debt. In October of 2009, a judge signed off on SemGroup’s bankruptcy settlement, in which producers in Kansas, Oklahoma, Texas and elsewhere were eventually repaid about $172 million, less than half of what they were owed.
The American Petroleum Institute says US petroleum deliveries in April averaged 19.6 million barrels per day, the highest figure for April in nine years. Crude oil production at 9.2 million barrels per day marked the second-highest April output in 44 years and the highest for any month since November, 2015.
The US has begun importing Iraqi oil at a rate of 1.1 million barrels per day to replace export cuts announced by Saudi Arabia late last month. Bloomgberg says the US imported Iraqi crude at the fastest rate in five years last week. They exceeded our Saudi imports for the first time. Iraq boosted exports in May to the highest since December, even as OPEC nations agreed to extend production cuts.
Kansas operators ramped up new production permits last month. There were 127 permits filed for new drilling locations across Kansas during the month of May, 2017. That and the year-to-date numbers are nearly double the figures from last year at this time. There were a whopping 13 new drilling permits filed in May in Ellis County, three in Barton County, one in Russell County and four in Stafford County. Last week there were 45 permits filed for drilling in new locations, bringing the year-to-date count up to 648 permits. There were 30 new permits filed in eastern Kansas and 15 west of Wichita, including new permits in Ellis County and Stafford County last week.
Independent Oil and Gas Service reported 91 completions last month, 53 in eastern Kansas and 38 west of Wichita, for a year-to-date total of 561 completions through May. Out of 38 new well completions west of Wichita last month, 10 were dry holes. Year-to-date out west, 93 dry holes out of 295 completions. Producers east of Wichita reported just two dry holes, out of 53 completions during the month of May.
For the week ending June 8, Independent reported eight new well completions across the state, 588 so far this year. All eight were wildcats, and all eight were in western Kansas.
Baker Hughes reported 927 active drilling rigs across the US last week, up eight oil rigs and three targetting natural gas. In Canada there are 132 active drilling rigs, up 33. Independent Oil a drop in the rig count east of Wichita, down four at 11 rigs. But in western Kansas there were 27, up six active rigs for the week. There are a total of 70 active rigs, including those awaiting their next assignment, compared to 61 total active rigs a year ago. They’re drilling at sites in Barton and Stafford counties, and moving in completion tools at five leases in Barton County and one each in Ellis, Russell and Stafford counties.
The Kansas Geological Society recognized and named eight new oil fields in Kansas during its meeting last month. Add one new “infield wildcat” discovery and you get 26 new discoveries of all types so far this year. That’s 14 more than last year at this time.
Tesoro Corporation will change its name August 1st to Andeavor, after acquiring the oil refiner and marketer Western Refining in a $4.1 billion deal. The purchasae will double the refiner’s nationwide workforce to 13,000 employees. Andeavor will have 10 refineries located in eight states with the capacity to refine 1.1 million barrels of oil per day. The new firm will also own more than 3,000 nationwide gas stations and convenience stores.
Growth in the western Oklahoma STACK oil play prompts good news and bad news in the area. In Kingfisher, Oklahoma, new businesses are opening, but housing is filling up. KOCO-TV-5 reports the town is running out of places for people to live, but says a developer is building a new housing addition, more than a dozen new homes. Similar stories are playing out across the region.
USD Partners has acquired a crude-oil terminal in Stroud, Okla., for $25 million. The company announced Monday the terminal will be used for rail-to-pipeline shipments of crude oil from western Canada to the oil hub in Cushing. The purchase price includes $2.2 million in one-time costs and anticipated capital expenditures to retrofit the terminal to handle heavy grades of Canadian crude oil.
The first-ever tanker with hauling liquefied natural gas from the United States arrived in Poland June 8 as part of that country’s and the region’s efforts to cut its dependence on Russia. It was the first delivery of U.S. gas to eastern and northern Europe, which is building a new network of energy sources and gas transportation.