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Oil and Gas Roundup — May 19

May 19, 2015
TOPICS: In the news
A roundup of oil and natural gas industry news from around the state, nation and world:

State rig count up by 1 to 103

The number of drilling rigs actively exploring for oil or natural gas this week in Oklahoma increased by one to 103, Baker Hughes Inc. reported Friday. The tally is down 92 rigs from a year ago, when it was 195.

Nationwide, the net number of active drilling units decreased by six this week to 888, said Houston-based Baker Hughes. The total is down 973 rigs from a year ago, when it was 1,861.

Of the rigs operating this week across the U.S., 660 rigs were exploring for oil, the lowest number in several years, while 223 were deployed for natural gas and five were classified as miscellaneous.

Among major oil- and gas-producing states, Texas lost six rigs, Wyoming declined by two and Alaska, Arkansas, North Dakota and Pennsylvania each lost one.

Kansas gained four rigs, Louisiana increased by three and Utah and West Virginia each gained one. California, Colorado, New Mexico and Ohio were unchanged.

The U.S. rig count peaked at 4,530 in 1981 and bottomed at 488 in 1999.

U.S. refiners dominate western hemisphere markets

The United States is fast becoming the major refining hub for the entire western hemisphere as plentiful crude at home and superior efficiency enable U.S. refiners to grab market share across the region.

U.S. refiners now supply almost a quarter of the rest of the hemisphere's daily fuel demand, up from less than 10 percent a decade ago.

U.S. refiners are exporting more than 4 million barrels of gasoline, diesel and other fuels every day around the world, up from 1 million barrels per day in 2005.

Two-thirds of the exports, almost 2.8 million barrels per day (bpd), go to markets in the western hemisphere, according to U.S. Customs.
Argentina, Brazil, Canada, Chile, Colombia, Costa Rica, the Dominican Republic, Ecuador, Guatemala, Honduras, Mexico, Panama, Peru and Venezuela all received record or near-record shipments last year.

Other countries as far away as France, Nigeria, China, South Korea, Australia and Lebanon have also seen increased imports from the United States.

But the western hemisphere has been the biggest and fastest growing market for U.S. refineries, accounting for an extra 2 million barrels per day since 2005.

— Reuters

Oil groups ask court to temporarily block U.S. fracking rules

Two oil and gas groups have asked a federal court to block the implementation new U.S. rules for hydraulic fracturing on public lands until their lawsuit challenging the regulations is resolved.

The Independent Petroleum Association Of America (IPAA) and the Western Energy Alliance filed a motion on Friday for a preliminary injunction to prevent the Interior Department's Bureau of Land Management from enforcing the regulations, arguing the standards will cause their members irreparable harm.

The regulations, finalized in March, would require companies to provide data on the chemicals used in hydraulic fracturing, or fracking, and to take steps to prevent leakage from oil and gas wells on federally owned land. They do not cover wells on private land.

In their filing with the U.S. District Court for the District of Wyoming, the oil trade groups said the fracking regulations display a "misunderstanding" of the technical aspects of oil and gas production.


Changes proposed for seeking endangered species listings

Petitions to federally list species as endangered will need to show that state wildlife agencies have been contacted beforehand and include relevant information about what those agencies are doing, the US Fish & Wildlife Service (FWS) and National Marine Fisheries Service (NMFS) said as they jointly proposed reforms to the federal Endangered Species Act (ESA) process.

Oil and gas producers have increasingly worked with state and local governments, property owners, and other stakeholders to mitigate identified environmental threats to the greater sage grouse, lesser prairie chicken, sand dune lizard, and other wildlife to make it unnecessary to list them as endangered or threatened under the ESA. Such listings potentially could shut down or severely restrict oil and gas operations.

The proposed rule changes by the US Departments of the Interior and Commerce agencies also would aim to improve science and increase transparency, provide incentives for voluntary conservation efforts, focus limited resources on areas where they would have the most impact, and update policies to increase collaboration between federal and state wildlife management services, FWS and NMFS said May 18.

Several states have moved aggressively already. Colorado Gov. John W. Hickenlooper (D) issued an executive order on May 15 directing state agencies to take additional actions to protect the greater sage grouse.

Read more at Oil & Gas Journal.

New British energy secretary says Conservative government will back hydraulic fracturing

The Tory-led government will back hydraulic fracturing, according to the new energy and climate change secretary.

Shale gas extraction will be allowed under national parks under the new government, Amber Rudd told The Sunday Times in an interview this weekend.

Rudd added that while the government would allow firms to exploit oil and gas resources, such activities would be tightly regulated.

“We have protected groundwater source areas and [prevented] national park drilling. I will make sure that we go out of our way to demonstrate to people the safety elements of it,” she said.

Hydraulic fracturing supporters welcomed Rudd’s appointment as energy secretary last week, based on previous comments she had made supporting the drilling. In February, she said preventing hydraulic fracturing beneath certain sites would not be “practical” and would “unduly constrain” hydraulic fracturing firms.

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