By JOHN P. TRETBAR
Members of the Nebraska Public Service Commission on Monday voted 3-to-2 to accept an alternative route for the new leg of the Keystone Pipeline expansion. During the meeting Monday, Commissioner Crystal Rhoades voted no, listing several objections to the proposal submitted by TransCanada. Among other things, Rhoades noted that the alternative route accepted by the commission was not the subject of the commission’s extensive environmental impact study, and she said it violated the due process of some landowners, who may not know their property is now being targeted. She said the original and the mainline alternative route both run through pristine farmland and cross over the Ogallala Aquifer. Opponents are expected to appeal the vote, and the case is likely to end up before the Nebraska Supreme Court. On the company’s Web site, TransCanada CEO Russ Girling said they are reviewing the ruling and “…assessing how it would impact the cost and schedule of the project.”
The Nebraska Public Service Commission was forbidden by law from considering a recent oil spill in South Dakota on the existing Keystone pipeline in its decision Monday. Company officials said cleanup continued at the site in Marshall County, SD., where approximately five thousand barrels (210,000 gallons) of crude spilled Nov. 16. TransCanada said the incident poses no risk to aquifers or surface water, public health or safety.
Independent Oil & Gas Service reported a 14% drop in the Kansas rig count over the last week: nine in eastern Kansas, down four, and 26 in western Kansas, down two. Drilling is underway at sites in Ellis, Russell and Stafford counties. Baker Hughes reported the oil rig count was unchanged nationwide. The natural gas rig count was up eight.
Kansas operators filed 47 permits last week for drilling at new locations across the state, 33 east of Wichita, and 14 in western Kansas. There were two permits filed in Barton County and one in Ellis County. The year-to-date total for permits in Kansas is 1,274. Kansas operators filed 108 permits for drilling at new locations during the month of October. There were 49 new permits filed last month in eastern Kansas and 59 west of Wichita, including one in Barton County, three in Ellis County, two in Russell County and two in Stafford County.
Independent Oil & Gas Service reports 12 new well completions over the last week, including eight in eastern Kansas and four west of Wichita. For the month of October, there were 129 new well completions, 58 in eastern Kansas and 71 west of Wichita. There were four completions last month in Barton County, five in Ellis County and seven in Stafford County. The total so far this year is 1,081 completions, compared to 1,022 through October a year ago, and 3,330 by this time two years ago.
“If Exxon’s looking at it, that’s probably a good sign.” So says an energy investment manager on the growing production figures out of New Mexico. Oil producers discouraged by the rising cost of accessing the vast deposits of the Permian Basin in Texas are sneaking in through New Mexico, which Bloomberg called “a geological back door.” In just the last five months, drilling on the New Mexico side grew by 25% to 75 rigs, while the number in Texas dropped two percent, to 490 rigs. New Mexico is the fourth-largest U.S. producer.
A new study shows that producers in the Permian Basin burned off between three and four percent of their natural gas in 2014 and 2015. That’s higher than the state average in Texas. Overall, companies working in the West Texas portion of the Permian Basin burned off around 80 billion cubic feet of natural gas in two years. The amount of flaring in the Permian Basin has been rising since 2009 and since 2014 it has overtaken the Eagle Ford Shale in South Texas as the field in Texas where the most natural gas has been burned as a waste product.
North Dakota oil companies in September exceeded rules aimed at limiting the amount of natural gas burned off as a byproduct of oil production. The Bismarck Tribune reports oil companies are supposed to capture 85 percent of natural gas or limit flaring to no more than 15 percent. State Mineral Resources Director Lynn Helms says companies flared 17 percent of production in September.
North Dakota’s oil production rose slightly in September and remained above 1 million barrels per day for the eighth consecutive month. Regulators say the state produced an average of 1.1 million barrels of oil per day in September, the latest figures available. That’s up from 1.08 million barrels in August. There were a record 14,190 producing wells in September, up 101 from August.
MMEX Resources broke ground Friday on its 10,000 barrel-per-day crude distillation unit near Fort Stockton, Texas, marking the first oil refinery to open in the US in 40 years. Once it is completed, the 126 acre, $50 million project will be able to process 10,000 barrels of crude oil each day.
The Energy Minister for the United Arab Emirates said this week there is an “appetite” for non-OPEC members to join the 14-member cartel. When asked by CNBC whether non-OPEC countries currently complying with the global supply cuts could eventually become official members of the cartel, he said “…there is definitely a willingness and a wish to expand OPEC.”
CNBC last week reported confirmation that the Saudi Aramco initial public stock offering will take place late next year, despite rumors of a possible delay.
On November 12, the second China-Russia crude oil pipeline project was finally completed. The 21st Century Business Herald reported the pipeline will double the amount of Russian oil transported to China by land-based pipeline. The pipe is more than 600 miles long, and will serve areas of northeastern China. It took about 15 months to build.