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Oil and Gas Roundup — July 20

July 20, 2016
TOPICS: In the news
A roundup of oil and natural gas news from around the state, nation and world:

Hamm to speak tonight at Republican National Convention

Former OIPA Chairman Harold Hamm will take the stage at the Republican National Convention tonight to deliver a speech on the U.S. oil and natural gas industry.

Hamm, the CEO of Continental Resources, is expected to take the stage at 8 p.m., followed by Republican primary candidates Scott Walker, Marco Rubio and Ted Cruz, former Speaker of the House Newt Gingrich and presumptive vice presidential candidate Mike Pence.

Hamm, who was Mitt Romney's energy adviser during his 2012 presidential campaign, publicly endorsed Trump in March at an OIPA Wildcatter Wednesday luncheon. In an open letter first published by the Wall Street Journal in April, Hamm said Trump will not be “beholden to special interests and has the fortitude to make tough decisions.

With a slew of onerous regulations now threatening to cripple American business, the next president of the United States must have the courage, determination and intelligence to disrupt politics as usual."

U.S. rig count up 7 to 447 as state count stays flat

The number of rigs exploring for oil and natural gas in Oklahoma was unchanged at 59 last week, as the U.S. count increased by seven to 447.

A year ago, 857 rigs were active in nationwide and 105 in Oklahoma. Depressed energy prices have sharply curtailed oil and gas exploration.

Houston oilfield services company Baker Hughes Inc. said Friday that 357 rigs sought oil and 89 explored for natural gas this week. One was listed as miscellaneous.

Among major oil- and gas-producing states, New Mexico gained four rigs and Louisiana three. Colorado, Pennsylvania and Texas were up one each.

Alaska, North Dakota, Utah and West Virginia declined by one rig apiece.

Also unchanged were Arkansas, California, Kansas, Ohio and Wyoming.

The U.S. rig count peaked at 4,530 in 1981. It bottomed out in May at 404.

Study shows no correlation between hydraulic fracturing and asthma, despite media claims

A new study published Monday found no link between hydraulic fracturing, or fracking, and asthma, despite numerous claims a link did exist in media coverage of the study.

USA Today, British Broadcasting Corporation (BBC) and CBS News all claimed the study directly linked fracking to asthma, when the authors of the study openly state they have no data to show fracking causes asthma or make symptoms worse.

The data shows counties with the most asthma have little to no fracking. The study was directly funded by a foundation with close ties to an environmental movement — the official position of which is anti-fracking.

“News outlets were quick to link fracking to asthma even though the authors admitted they do not have the data to support it,” Dr. Katie Brown, a spokeswoman for the energy industry group Energy In Depth, told The Daily Caller News Foundation.”

That important caveat was purposely buried in the study, and not part of the press release. Unfortunately, the media wrote what the researchers wanted them to write, I suppose, because it’s easier to be a stenographer than a researcher.”

Read more at The Daily Caller.

North American oil deals trickle back after Brexit shock

Acquisition-hungry energy companies are back on the prowl.

Dealmakers have recovered from the shock of Britain's "Brexit" vote last month to leave the European Union and have resumed buying oil and gas fields in choice locations in Canada and the United States, restocking their inventories on a bet that a two-year slump in the price of oil has abated.

"Buyers are increasingly confident in a stable to slowly increasing oil price - as are their funding sources, whether private equity funds or public market investors," said Bobby Tudor, chief executive of Tudor, Pickering, Holt & Co., an oil and gas investment bank.

Oil prices have held steady at or above $45 a barrel for a majority of the last two months and touched a 2016 high above $51, ahead of the British referendum.

Tudor said buyers were banking on it eventually settling at around $60 a barrel, giving them confidence about buying drilling acreage in some of the nation's shale heartlands.

U.S. oil and gas producer Diamondback Energy Inc. last week said it would spend $560 million buying leases on oil-rich land in the Southern Delaware Basin, within the Permian Basin, the top U.S. oilfield, where initial production results have been strong and costs are coming down.

A day later, U.S. energy company Laredo Petroleum Inc. said it would spend $125 million buying acreage in the Midland Basin, also part of the Permian.

These deals mark a resumption in buying after Brexit caused a temporary lull in acquisitions.

Read more at Reuters.

U.K. could ramp up fracking to boost post-Brexit energy supplies

A temporary ban was introduced in 2011 on the hydraulic fracturing - or "fracking" - technology used to extract gas from shale rock, but sections of the industry hope for support from new prime minister Theresa May.

Stephen Bowler, chief executive of London-listed shale gas developer IGas, told Reuters that Brexit made the case for shale more vital: "An independent Britain needs an independent supply of energy. Security of supply becomes even more important now."

Shale gas had a poor start in Britain. The first well to be fracked, near the seaside city of Blackpool in Lancashire, was abandoned when some of the work there triggered an earth tremor that resulted in an 18-month ban on the technology.

More recently, low energy prices have added to strains. "The weak gas price certainly doesn't help the economics. But there's still a lot of potential there," said David Round, analyst at BMO Capital Markets.

"You'd expect costs to come down once you get a few years into the development."

Two months ago, Third Energy received the first planning approval for a shale gas fracking well since 2011. It says it will start hydraulic fracturing at its Kirby Misperton site in North Yorkshire before the end of the year.

Read more at The Independent.
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