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Oil and Gas Roundup — May 27

May 27, 2016
TOPICS: In the news
A roundup of oil and natural gas industry news from around the state, nation and world:

State rig count up as national number stays flat

The number of rigs exploring for oil and natural gas in Oklahoma was up two this week to 59, according to data from Baker Hughes.

The number of rigs in the U.S. stayed flat at 404.

Of the other major oil- and gas-producing states, Texas flat unchanged at 173, Louisiana gained a rig to 48, North Dakota fell one to 22, New Mexico was flat at 18, and Colorado and Pennsylvania were both unchanged at 16.

A year ago, there were 875 active rigs in the U.S. and 106 in Oklahoma.

Nationwide, 316 rigs were exploring for oil and 87 for natural gas; 314 rigs were drilling horizontally, 46 vertically and 44 directionally.

Trump wants to be energy independent

Donald Trump will emphasize getting rid of regulations in a major energy speech Thursday, while emphasizing fracking, coal and energy exports.

Trump previewed his energy policy at a press conference Thursday ahead of the speech.

"I think the federal government should get out of the way" when it comes to energy, the Republican presidential nominee told reporters.

"I want to be energy independent" and be able to sell the nation's crude oil, gas and coal resources abroad, he said.

"We are sitting on energy you couldn't believe," he said.

He said the Obama administration's regulations on coal are "out of control," and that as president "all I can do is free up the coal."

He said if the U.S. does what his Democratic rivals suggest, which is to ban fracking, or hydraulic fracturing, it would send the country straight "back into the Middle East."

Fracking has been mostly responsible for the U.S. energy boom of the last decade that has vaulted the country to be the world's biggest crude oil and natural gas producer.

Trump said he supports all types of energy, even solar. But there's a problem with renewables, which is that most aren't commercial "without subsidy," he said.

"The problem with solar is it's very expensive," he said. "Wind is very expensive," he said, adding that it also kills birds.

"Wind is killing hundreds and hundreds of eagles ... killing by the hundreds."

— Washington Examiner

Experts on lifting of the crude export ban: We're all winners

Energy executives representing all sectors of the oil and gas sector believe opportunities lie in the recent lifting of the crude export ban. During a panel session at the KPMG Global Energy Conference Wednesday, C-suite executives in upstream, midstream and downstream all ultimately agreed that Congress’ decision to lift the ban on crude exports was a good thing. No real surprises there.

Tony Chovanec, vice president, fundamentals and supply appraisal for Enterprise Products, said lifting the ban will bring efficiency to the transport of hydrocarbons.

“We have a significant overhang of oil around the world … as we work through that overhang, I think you’re going to be surprised at the number of people that are investing in the US who want some of the US hydrocarbons in their portfolio,” he said.

Chovanec, whose company exports between four and six million barrels of oil per day, said he’s seeing companies finding niche opportunities in regards to tight oil – essentially, they’re acquiring the oil where it makes sense to have it in their portfolio.

“What we now have is an improvement in efficiency of how we allocate [oil],” said Dr. Harold “Skip” York, vice president, integrated energy for Wood Mackenzie. “A lot of US crude oil exports’ final destination is the US.”

Read more at RigZone.

A victory for the U.K. oil and gas industry

It was a long time coming, but all the sweeter for that. On May 23rd, the North Yorkshire County Council gave the go-ahead for a company to start hydraulic fracturing, or “fracking”, for shale gas in the village of Kirby Misperton, near Malton.

It is the first time since 2011 that permission has been given for fracking in Britain, and the industry hopes that this decision will pave the way for numerous other such planning decisions to go their way in the coming months. The news will certainly cheer the government, which has strongly supported fracking.

While Britain has lagged, other countries, notably America, have raced ahead with the shale-gas revolution, transforming energy markets. The hope is that Britain, too, can now begin to join in.

Most importantly, the permission to frack at Kirby Misperton will help resolve the question of how much shale gas there actually is under North Yorkshire, and the north of England more generally. Exploration can now begin properly. Companies such as Third Energy, the company just approved in Yorkshire, and Cuadrilla, which was turned down for permission to frack in Lancashire last year, believe that the deposits are substantial.

There are also thought to be similarly rich deposits in Britain’s other main shale formations, in the Weald Basin in southern England, and the Midland valley of Scotland. Even by conservative estimates, there could be enough shale gas to transform Britain’s own energy market.

Without fracking, by 2019 Britain is expected to import about 70% of its gas. But if even 10% of the British Geological Survey’s estimate of deposits are recoverable, that could make the country self-sufficient in gas for up to 50 years. This would, of course, be a boon to the balance of trade, and the government hopes that fracking will also create jobs and boost manufacturing.

Read more at The Economist.
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