BY JOHN P. TRETBAR
A ruling last week by the United States Supreme Court held that about half of the state of Oklahoma is Native American reservation land, and that could raise serious issues in the oil patch. The ruling does not affect property ownership, but energy lawyers tell Reuters it could result in slight tax increases, and an increased regulatory role in pipeline and storage approvals. There may also be implications for wind energy and electric transmission as well as the sale of water. The Five Tribes and the State of Oklahoma issued a joint statement saying they were working together on a framework of shared jurisdiction to support public safety, the economy and private property rights.
American oil giant Chevron has agreed to acquire Noble Energy, a Houston-based international oil and gas developer, for $5 billion. The New York Times reports Noble’s share price is down about 60 percent from the beginning of the year, allowing Chevron to buy the operator's oil and gas resources at a huge discount. Chevron said the deal would add around 18 percent to its oil and gas reserves at a cost of less than $5 a barrel.
For the first time since the horizontal drilling boom, crude production in North Dakota dipped below one million barrels per day. The Department of Mineral Resources reports total May production dropped by more than ten million barrels in May, the latest figures available. That's a drop from one point two million barrels per day in April, to 858,000 barrels per day in May. The second-highest crude-producing state also repeated it's best-ever gas-capture rate, recovering 88% of the natural gas produced at oil wells.
Independent Oil & Gas Service reported a slight drop in its weekly rig counts. There are three active rigs west of Wichita, down four from a week before. The count in eastern Kansas was unchanged at one active rig. Drilling is underway on one well in Russell County, and an operator is about to spud a new well on a lease in Stafford County. Baker Hughes reports 253 active drilling rigs nationwide, down one oil and four gas rigs.
Regulators last week approved 11 permits for drilling at new locations in Kansas, including one in the eastern half of the state, and ten in Western Kansas. There are 240 new drilling permits on file across the state so far this year. Independent Oil & Gas Service reports ten newly-completed wells across the state last week, all of them west of Wichita, including one new well in Stafford County. Operators have completed 556 wells so far this year, down more than 100 compared to last year at this time.
The Energy Information Administration reported a sizable decline in U.S. crude-oil inventories last week, down seven and a half million barrels from the week before, at just over 531 million barrels. EIA says stockpiles remain about 17 percent above the five year average for this time of year.
EIA reported U.S. crude imports averaged 5.6 million [["five point six million"]] barrels per day last week, down nearly million barrels per day from the previous week. Over the past four weeks, imports averaged 10.2% less than the same four-week period last year.
U.S. crude-oil production dropped by nearly half a percent, down 42,000 barrels at over ten-point-nine million barrels per day. Output is down about a million barrels per day compared to last year according to the latest weekly report from the government.
The Association of American Railroads says oil-by-rail deliveries were up slightly for the week ending July 11, but were down 23% compared to a year ago.
The Energy Information Administration says Canada's oil patch has seen a 20% drop in production in the first half of the year. Low prices, low demand, and provincial-government limits on production combined to slash Canada's output. Last year, Canada was the world's fourth-largest producer.
The government says 40 top U.S. producers collectively wrote down $48 billion worth of assets during the first quarter of 2020. EIA says these 40 firms produced about 30% of the U.S. total, roughly 6.1 million barrels of crude oil per day.
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July 22, 2020 at 05:31PM
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News From the Oil Patch: Tribal ruling in Okla. impacts oil patch - hays Post
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