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Oil and Gas Roundup — July 12

July 12, 2017
TOPICS: In the news, OIPA
A roundup of oil and natural gas industry news from around the state, nation and world:

Everything to know about allegations U.S. environmentalists may have secretly taken Russian cash

House lawmakers want the Trump administration to investigate reports that a wealthy foundation used an offshore shell company to give millions of dollars to environmental activists opposed to U.S. energy development.

“If you connect the dots, it is clear that Russia is funding U.S. environmental groups in an effort to suppress our domestic oil and gas industry, specifically hydraulic fracking,” Texas Republican Rep. Lamar Smith said Friday.

Smith and Texas Republican Rep. Randy Weber asked Treasury Secretary Steve Mnuchin to investigate whether or not environmentalists were funneling money to U.S. environmental groups through a Bermuda-based shell company.

Republicans are pitching it as part of a larger investigation into the extent of Russian meddling in U.S. politics. Russia, after all, has an incentive to keep U.S. oil and natural gas “in the ground” — a slogan used by many environmental activists.

Activists call the allegations were “absurd and false smears.” Though none of the groups seem keen on heading off a potential investigation by giving back the millions they got from the non-profit under investigation.

Read more at Daily Caller.

Former OIPA Chairman Bob Sullivan: Can private sector thinkers help solve our state’s problems?

As caring citizens, interested in effective and efficient state government, many of us are justifiably frustrated at a lack of progress over the last few legislative sessions.

Core state services seem stagnated by inefficiencies and funding problems. Education appears to be mired in a quagmire of teacher pay needs, administrative overload, and disappointing academic results across much of the system.

Fundamental reform is needed in virtually all of state government’s core services, but political infighting paralyzes legislative sessions where critical issues receive Band-aid solutions and get shoved to the next session.

One solution for this frustrating cycle would be to engage the private sector more extensively in the problem-solving process.

To be sure, the business world has its own problems and shortcomings, but it is undeniable that our country has spawned millions of effective problem-solvers through the free enterprise system that was born into America’s fabric at the outset, and Oklahoma has hatched more than its share of such leaders.

Motivated by the hope of rewarding results and a better life, private sector originators are endowed with a rooted instinct for creative thinking, taking calculated risks and achieving lofty goals. Oklahoma has plenty of such entrepreneurs, many of them spawned in the Oil Patch.

With goal-oriented entrepreneurship baked into the state’s culture why, then, is our state government so paralyzed? While the answer may not be clear, perhaps a solution is to involve private sector problem-solvers more extensively in tackling the key issues facing our state.

Read more at the Tulsa World.

Agency projects U.S. natural gas exports will quadruple this year

A government report on Tuesday forecast U.S. liquefied natural gas exports will quadruple this year, a projection that could bolster the Trump administration’s promotion of American “energy dominance.”

Gross LNG exports are expected to average 1.9 billion cubic feet per day in 2017, compared with 0.5 billion cubic feet last year, and rise to 2.8 billion cubic feet in 2018 as new LNG facilities come online, according to the U.S. Energy Information Administration. The federal agency said the increase in exports is being driven by international demand from countries with low natural gas resources.

The report comes a week after President Donald Trump met with European leaders to discuss increasing LNG exports, amid a push to promote the dominance of U.S. energy.

“The availability of LNG to Europe is important because it creates a more diverse European gas market, which can help to prevent over-reliance on gas from a single source, such as Russia,” Richard Morningstar, director of the Global Energy Center at the Washington-based Atlantic Council, said in an interview on Tuesday.

The Energy Department did not respond to a request for comment on what the EIA’s projections mean for the administration’s focus on energy exports.

Thomas Pugh, a commodities analyst at the consulting group Capital Economics, said the U.S. geographic position also allows it to pick which partners make the most economic sense — not just Europe but also Asian markets. The White House last month announced plans for increased exports to South Korea and India.

Read more at Morning Consult.

Oil climbs as sources say API data show U.S. crude supply down more than 8 million barrels

The American Petroleum Institute reported Tuesday a much larger-than-expected drop of 8.1 million barrels in U.S. crude supplies for the week ended July 7, according to sources.

"We are finally seeing the impact from cumulative OPEC cuts, lower U.S. output and strong demand," said Phil Flynn, senior market analyst at Price Futures Group.

The API data also showed a fall of 801,000 barrels in gasoline supplies, while inventories of distillates were up 2.1 million barrels, sources said. Supply data from the Energy Information Administration will be released Wednesday morning.

Analysts polled by S&P Global Platts expect the EIA to report a decline of 2.6 million barrels in crude inventories. August crude was at $45.71 a barrel in electronic trading, up from the contract’s settlement of $45.04 on the New York Mercantile Exchange.

— MarketWatch

Advocates for methane rule dominate EPA hearing

Public interest groups and local stakeholders at a public hearing Monday urged the Environmental Protection Agency to continue to enforce methane regulations.

The hearing at the EPA’s headquarters in Washington related the agency’s recent moves to delay the Obama administration’s methane rules for two years. Conservationists, health experts and community members focused on the effects of methane emissions and climate change on their lives.

In a 2-1 decision, the United States Court of Appeals for the District of Columbia Circuit ruled last week that the EPA could not postpone implementing the methane rule for three months, denying the agency’s request. But Justice Department lawyers representing the EPA asked to delay enforcement while the agency considers an appeal.

The EPA continues to identify methane as a greenhouse gas. The Obama administration last year added regulations for methane gas that escapes through oil and gas wells. But the EPA under President Donald Trump has said staying enforcement on those rules for the next two years would save businesses $235 million during that time period.

Read more at Morning Consult.

Iraq plans to offer new exploration rights for oil, gas

Iraq says it will offer new oil and gas exploration rights as it looks to boost energy revenues to fund its war against the Islamic State group and shore up its finances amid low oil prices.

Oil Minister Jabar Ali Al-Luaibi said late Tuesday that his ministry plans to put nine border exploration blocks up for bidding by international energy companies. Five are shared with Iran, three with Kuwait and one is in the Persian Gulf.

He did not provide a timetable.

Iraq has the world's fourth largest oil reserves. This year, it added 10 billion barrels, bringing its total reserves up to 153.1 billion. Low oil prices have taken a heavy toll, as some 95 percent of the country's revenues come from the energy sector.

— Associated Press

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