By JOHN P. TRETBAR

TransCanada announced it has secured commitments of half a million barrels per day, Keystone Pipeline expansion across Nebraska to move forward. The company says its preparing for construction and working with the new list of landowners to get the necessary easements along the new route approved by state regulators in November.

Opponents filed court challenges to the new route and say the company’s announcement changes nothing. Arguments are expected before the state Supreme Court later this year. If the challenge succeeds, the company would have to file for a new permit, which could take up to a year.

Federal investigators believe a broken wheel caused a May 2015 oil train derailment and fire that prompted the evacuation of Heimdal, North Dakota. Investigators found a mark on the track indicating a broken wheel and found pieces of a broken wheel at the scene. The National Transportation Safety Board said workers had repaired another defective wheel on the train two days before the catastrophe. Five derailed cars breached and spilled nearly 100,000 gallons of crude oil, fueling a massive fire that forced 30 people had to evacuate.

Independent Oil & Gas Service reported a slight decline in the number of active drilling rigs across Kansas, with seven in the eastern half of the state, down two, and 25 west of Wichita, down one. Baker Hughes reported 936 active drilling rigs nationwide Friday, adding two gas rigs but losing five exploring for oil. Canada reports 325, an additional 49 active rigs.

Kansas operators filed 45 permits to drill at new locations last week, 28 east of Wichita and 17 in the western half of the state.

Independent Oil & Gas Service reported 34 newly-completed wells in Kansas last week, 13 in eastern Kansas and 21 west of Wichita. There were two completions in Barton County, three in Ellis County and two in Stafford County.

OPEC and others insist they’ve reduced crude consumption by 1.8 million barrels per day as part of last year’s agreement. But one analyst insist the actual reduction was closer to a quarter million barrels. Robert Boslego claims the Saudis and Russians are posting normal seasonal declines as new production cuts.
Saudi Arabia’s energy minister said Sunday that OPEC and other big-oil producing allies like Russia should find ways to cooperate beyond their current production agreement. He said OPEC’s message should be that this is something that is here to stay.

North Dakota oil production increased about 1 percent in November to 1.19 million barrels per day. Director Lynn Helms of the Department of Mineral Resources says he expects later this year his state will beat the its best-ever production of 1.23 million barrels per day, set back in December of 2014.

Last week CNN reported the oil spill from a sunken tanker off the coast of China was “…bigger than Paris.” Now it’s bigger than Paris, Lisbon and Zurich combined. China’s State Oceanic Administration said Sunday there are three spills, which have tripled in size to 128 square miles in the week since the tanker exploded and sank.

Revised numbers released this week show North Dakota’s oil industry failed to meet the state gas capture target in October. The Department of Mineral Resources reports the industry flared slightly more than 16 percent of Bakken natural gas produced in October. The target is 15%, but that increases to 88% in November. Director Lynn Helms said it will take “serious investment” in natural gas gathering and processing to meet that target.

U.S. shale oil production will grow by 111,000 barrels a day to 6.55 million barrels a day in February, according to a government forecast. Most of that increase came from the Permian Basin in Texas and New Mexico which gained 76,000 barrels a day. Surging shale production is poised to push total US output to record levels not seen in nearly 50 years, rivaling the world’s leading producers.

EIA this week also reported the highest demand for gasoline in January since 2011. That pumped up prices by about four cents on the week to a nationwide average of $2.534. Triple-A says the statewide average in Kansas jumped about nine cents in the last week to $2.375. Prices at the pump in Hays and Great Bend were up to $2.33 a gallon.

Two oil patch trade groups in Oklahoma are supporting “Step Up Oklahoma,” a plan proposed by a civic group that would double the production taxes on new wells. One of the groups has already gone to court to block a different effort that would nearly quadruple that tax. The Oklahoma Oil & Gas Association and The Oklahoma Independent Petroleum Association announced their support for the alternative plan, that, among other things, would essentially do away with a two percent tax reduction granted for new wells a few years ago. After 36 months the rates go up to seven percent anyway. OIPA last week filed legal challenges against a ballot initiative that would tax all production, including those first three years, at seven percent.