BY JOHN P. TRETBAR
The Kansas Geological Survey reported new oil production numbers for the state Tuesday. Operators produced 3.08 million barrels in August. The total for the first eight months of the year is 24.151 million barrels of crude from 50,901 active wells.
Ellis County led the state with 230,000 barrels of new production for a total through August of 1.77 million barrels. Barton County reported 150,000 barrels in August for total production of 1.14 million barrels through August. Russell County 135,000 barrels for the month, with the running total reaching 1.07 million. And in Stafford County, producers added 90,000 barrels for a total through August of just over 700,000 barrels.
Here are the ten top oil-producing counties in Kansas through August (KGS):
Ellis 1.77 million barrels
Haskell 1.61 million barrels
Barton 1.14 million barrels
Finney 1.08 million barrels
Rooks 1.077 million barrels
Russell 1.072 million barrels
Ness 1.004 million barrels
Harper 706 thousand barrels
Stafford 700 thousand barrels
Barber 649 thousand barrels
Independent Oil & Gas Service reported 11 active drilling rigs in eastern Kansas last week, down two from the week before, and 25 west of Wichita, which is up three. Drilling was underway at one lease in Ellis County. Operators report drilling ahead at sites in Ellis and Russell County. They’re moving in completion tools at three sites in Barton County, two in Ellis County, one in Russell County and two in Stafford County. Baker Hughes reported 931 active drilling rigs coast-to-coast, an increase of two oil rigs. Canada reported 219 active rigs, down three.
Kansas operators filed 35 permits for drilling at new locations across the state last week, 1,359 so far this year. There are 18 new drilling permits east of Wichita, 17 in western Kansas, including one new permit in Barton County.
Independent Oil & Gas Service reports 33 new well completions for the week, 1,243 so far this year. There were 22 wells completed in eastern Kansas and eleven west of Wichita, including two in Stafford County.
The Trump administration imposed two-year delay in implementation of an Obama-era rule intended to curb methane emissions from drilling on public lands. The Interior Department’s Bureau of Land Management is taking action to delay the rule, according to a filing in the Federal Register. The rules have been the subject of court fights and a failed vote in the Senate to repeal them.
The government’s lease offering of 900 tracts in the National Petroleum Reserve in Alaska drew bids on just seven of those tracts. The bids Wednesday totaled $1.16 million. All of the bids were submitted jointly by subsidiaries of ConocoPhillips and Anadarko.
US Commodity Futures Trading Commissioner Bart Chilton and his team on Monday announced the creation of the first digital currency based on a physical asset. OilCoin will tokenize barrels of oil held in reserve with each token representing the value of one barrel. A public token sale is scheduled early next year. Commissioner Chilton says OilCoin is a regulated digital currency based upon “something real that folks can touch and feel,” which could provide a safe haven from the volatility associated with cryptocurrency.
The vice-chairman of China’s securities regulator says they’re near “the starting point for the comprehensive opening of China’s futures markets to the world,” beginning with the imminent launch of crude oil futures. According to Reuters, he did not elaborate on when the Chinese crude futures would start trading.
Chevron announced it would cut its total capital and exploratory budget for a fourth consecutive year in 2018. But the supermajor is significantly boosting spending on U.S. shale, especially in the Permian Basin of Texas. The company will drop 3.3 billion for Permian production and another one billion for other shale investments, compared to $2.5 billion this year.
Government finances in New Mexico have turned around, after two years of drastic cuts, to the point that lawmakers can now expect revenues to exceed spending by $199 million, or about 3.3%. The rebounding oil patch in New Mexico gets credit for much of that. In a report to legislators, officials said income from oil and natural gas was adjusted upward by $140 million for the current and coming fiscal years. Income tax projections were also higher.
A North Dakota trucking firm learned the hard way that it can be fined by both the health department and oil and gas regulators for dumping oilfield wastewater. The company, Black Hills Trucking lost its bid to reject nearly a million dollars in civil penalties assessed by that state’s Oil and Gas Division. Black Hills argued before the state Supreme Court that jurisdiction in the case belongs solely to the Health Department, because the dumping incidents occurred on a road and not on a well pad. The Health Department has already issued a civil penalty. The high court ruling Thursday affirms the Oil and Gas Division’s additional $950,000 fine plus costs.
North Dakota health officials have concluded that a proposed oil refinery close to the Theodore Roosevelt National Park should comply with federal and state air pollution rules. The company still needs a state water permit as well. Operators were able to skirt the normal site-selection process because at up to 49,500 barrels, the proposal falls just below the state threshold requiring the Public Service Commission to approve the site. Meridian Energy Group says it will be the “cleanest refinery on the planet,” but activists complain it’s too close, just three miles from the national park.
Federal geologists agree to reevaluate the amount of recoverable crude oil in North Dakota. U.S. Senator John Hoeven and industry officials requested the new assessment by the U.S. Geological Survey, saying it would likely attract investment by showing stronger production potential. They want the USGS to take into account 17 other formations in western North Dakota that could be exploited using technology developed for the Bakken and the Three Forks.
Thirteen oil companies failed to meet North Dakota’s natural gas flaring goals in September. The Bismarck Tribune reports operators in September burned off more than 300 million cubic feet of natural gas daily — a level not seen since the summer of 2015. But Mineral Resources Director Lynn Helms says the state’s gas capture targets are working “extremely well.” He says they’ve brought the percentage of gas flared down from the peak of 36 percent in September 2011. Flaring is expected to be down to 12 percent next year and down to nine percent by 2020.