By JOHN P. TRETBAR
Independent Oil & Gas Service reported a 5% statewide increase in active drilling rigs with 13 in eastern Kansas, up three, and 27 west of Wichita, down one. Operators report drilling underway at two leases in Barton County, and drilling ahead at sites in Barton, Ellis and Stafford counties. They’re moving in completion tools at one site in Barton County, and four well sites in Ellis County. Baker Hughes reported an increase of five oil rigs and three gas rigs in its weekly Rotary Rig Count for a total of 1,021 active drilling rigs nationwide. The count in Canada dropped eight rigs to 85.
Kansas producers filed 46 permits to drill at new locations across Kansas last week, 503 so far this year. There was one new permit in Barton County and two in Ellis County among the 15 filed in the western half of the state. There are 31 new permits east of Wichita.
Independent Oil & Gas Service reported 20 well completions across the state for the week, 493 so far this year. There were nine newly-completed wells in eastern Kansas. Out of 11 completions in western Kansas, six were dry holes. Operators completed one wildcat play in Stafford County that is producing pay dirt.
The EPA has granted a financial hardship waiver to an oil refinery owned by billionaire Carl Icahn, exempting the Oklahoma facility from requirements under a federal bio-fuels law. Reuters reports the waiver enables Icahn’s CVR Energy to avoid tens of millions of dollars in costs under the U.S. Renewable Fuel Standard. The regulation is meant to cut air pollution, reduce petroleum imports and support corn farmers by requiring refiners to mix billions of gallons of bio fuels into the nation’s gasoline and diesel each year. CVR also owns the refinery in Coffeyville, Kansas.
Chesapeake Energy has been beleaguered by debt for some time now, but investment analysts suggest the OKC-based firm’s oil discoveries in South Texas may be worth more than all of the company’s long-term debt. Those debts total $9.2 billion, and start coming due in 2021.
The Oklahoma House voted last week to end refunds from tax credits tied to low pollution emission rates. Backers supported by the oil industry say the state could save up to $750 million in the next 10 years. Opponents warned of bankruptcies at existing wind projects and damage to Oklahoma’s business reputation.
Observers say litigation appears likely if the pending bill becomes law. Oklahoma moved last year to stop new wind projects from qualifying for zero-emission generation tax credits. S.B. 888 aims to stop existing sites from getting refunds related to credits in the years ahead.
In Colorado, a judge has blocked buffer zones and other local oil and gas rules in the City of Thornton. Judge Edward Moss ruled the state’s Oil and Gas Conservation Commission regulations trump 15 different rules Thornton made, including the buffer requirements. Moss said the city “cannot authorize what state law forbids or forbid what state law allows.”
They’re not ready to load any supplies for export right now, but for the first time a so-called Very Large Crude Carrier arrived at a jetty in the port of Texas City, Texas. The Nave Quasar can handle up to two million barrels of crude oil. Bloomberg reports the tanker was on its way to an Enterprise Products Partners terminal to determine the metrics for future exports.
Marathon Petroleum Corp. agreed to buy rival oil refiner Andeavor for $23.3 billion. The deal could create the largest independent refiner in the U.S.
Europe’s oil refineries are increasingly missing out on Russian crude as the world’s biggest energy producer directs more and more barrels by pipeline to China. Bloomberg reports Russia will ship nearly 20 percent less crude through its main European ports during the first five months of 2018 compared with a year earlier. Russia is China’s number-one supplier.
Chevron evacuated some executives from Venezuela after two of its workers were imprisoned over a contract dispute with state-owned oil company PDVSA. The arrests, in a raid by national intelligence officers, were the first at a foreign oil firm since Venezuela’s government launched a purge last fall that has resulted in detentions of more than 80 executives at PDVSA and its business partners. Reuters reports the Chevron workers may face charges of treason for refusing to sign a supply contract for furnace parts. The workers balked at the high costs of the parts and a lack of competitive bids.
A report from Bloomberg suggests that China’s conversion to electric buses is having a big impact on that country’s fuel consumption. Nearly all of the world’s electric buses are in China, which is adding nearly ten-thousand more every five weeks. Every 1,000 battery-powered buses on the road saves about 500 barrels a day of diesel fuel. This year, analysts suggest the volume of fuel not needed may rise 37 percent to 279,000 barrels a day.
