Facts & Rumors # 576
November 23, 2024
US Natural Gas Drillers to Lift 2025 Output, Reversing Year of Cuts. Reuters. U.S. natural gas producers will boost output in 2025 following a series of production cuts this year, as rising demand from liquefied natural gas export plants is expected to increase prices that had fallen to multi-decade lows. U.S. production is on track to decline in 2024 for the first time since 2020, when the COVID pandemic reduced demand, according to the U.S. Energy Information Administration’s latest outlook.
Encino Bullish on Utica Oil. Encino’s Tim Parker: Plenty of Utica oil—and takeaway too. Hart Energy. Encino Energy’s Tim Parker tells Hart Energy’s Nissa Darbonne about the economics of drilling in the company’s Utica oil development at the DUG Appalachia Conference and Expo. Tim Parker is chief technology officer for Encino Energy, Ohio’s new No. 1 oil producer. Tim just spoke at DUG Appalachia, the 16th annual DUG Appalachia Conference in Pittsburgh.
Can Trump Bring Back Keystone XL Pipeline? Trump likes the Keystone XL pipeline. Restarting it faces longer odds than ever. Barron’s. President-elect Donald Trump is looking for ways to boost oil supplies. One idea involves resurrecting a controversial piece of infrastructure he championed in his first term. The incoming administration is considering reviving the Keystone XL oil pipeline from Canada to the U.S., according to three unnamed sources who spoke to Politico. According to the report, Trump wants to greenlight the pipeline on his first day in office.
‘Wildcatters’ Will Be Running Trump’s Energy Policy. How oil ‘wildcatters’ ended up in charge of Donald Trump’s energy policy. Financial Times. On Friday, Trump named Burgum as both his interior secretary and his “energy tsar”, handing him sweeping authority to open federal lands to frackers and deregulate agencies to boost US oil and gas output. On Saturday, the president-elect picked as his energy secretary Chris Wright, a shale executive who had been promoted by Hamm for months. “They understand what we do,” said Steve Pruett, CEO of Elevation Resources, based in neighboring Midland, and chair of the Independent Petroleum Association of America.
PA Permitting Time Reduced. Thanks, MDN. Permitting in Pennsylvania overseen by the Dept. of Environmental Protection (DEP) has been a hot mess for years. A Chapter 102 Erosion and Sedimentation permit sometimes takes two, three, or even six months for approval — instead of the policy-mandated 14 days. According to a DEP press release from yesterday, that’s all behind us now. DEP Acting Secretary Jessica Shirley and Gov. Josh Shapiro said the agency has eliminated the backlog for oil and gas permits. Credit where credit is due.
Trump Selects DOE Secretary. Trump taps oil executive Chris Wright as Energy secretary. Politico. President-elect Donald Trump named oil industry CEO Chris Wright to lead the Energy Department, installing a vocal critic of government efforts to fight climate change as the head of the agency at the forefront of the Biden administration’s clean energy push. Wright, if confirmed by the Senate, is likely to be one of the loudest voices in the administration against measures to curb greenhouse gas emissions from the burning of fossil fuels that are raising the planet’s temperature and causing an upsurge in extreme weather. BBC, Bloomberg, Financial Times, Hart Energy, New York Times, NPR, Reuters, and Wall Street Journal also report.
STEO NatGas $2.95 in 2025. Thanks, MDN. The U.S. Energy Information issued its latest monthly Short-Term Energy Outlook last week, the agency’s monthly best guess about where energy prices and production will go in the next 12 months. In October, the EIA predicted the average spot price for natural gas will be $3.10/MMBtu in 2025 (see Oct. STEO Predicts Lower Output, NatGas Price to Avg $3.10 in 2025). Last week, the agency reduced that number by $0.20 to $2.90/MMBtu. EIA predicted the average spot price for natural gas for all of 2024 will end up being $2.20/MMBtu, a drop of $0.10 from the October prediction. EIA analysts also predict that the average spot price will be $2.80 during the first quarter of next year.
NERC Worries About Freezing Temperatures Impact on NatGas. The North American Electric Reliability Corporation (NERC) released its annual Winter Reliability Assessment (WRA) last Thursday (full copy below). The report expresses concern about the potential for freezing temperatures to impact the delivery of natural gas to power plants this winter. Texas has worked hard to winterize its NatGas infrastructure following previous disasters. Outside of Texas, there is “little to no information to indicate that upstream gas producers, gatherers, and processors have improved winterization of their operations,” said the report. Should we be concerned?
Burgum to Head National Energy Council and Interior Department. Trump names Interior nominee Burgum to head new National Energy Council. Politico. President-elect Donald Trump is putting Doug Burgum at the center of his incoming administration’s energy initiatives, naming his nominee to head the Interior Department to a czar role that will coordinate a push across the federal government to rev up energy production. In his new position, Burgum will lead a new National Energy Council, which will give the North Dakota governor a seat on the National Security Council and “oversee the path to U.S. ENERGY DOMINANCE,” Trump said in a statement.
DT Buys Appalachian Pipelines. Thanks, MDN. DT Midstream (DTM), headquartered in Detroit, owns major assets in the Marcellus/Utica region and in other regions, such as Haynesville. Yesterday, DTM announced it had cut a deal to buy three FERC-regulated interstate pipelines from Oklahoma-based ONEOK, Inc. for $1.2 billion. Two of the three pipelines flow Marcellus/Utica molecules to Midwestern markets.
O&G Will Surge Under Trump. Expect surging oil and gas industry under new Trump admin. Law360. Throughout his recent campaign, President-elect Donald Trump promised increased oil and natural gas production, “energy independence,” reduced energy costs and reduced reliance on renewable energy. While the exact plan for how this is all to be accomplished remains under development, as executive orders, presidential proclamations and general strategy are being prepared and refined, markets have already responded favorably to the prospect of a second Trump presidency.
October DUC’s Report. The number of drilled, but uncompleted wells in four of the US’s most prolific shale plays during October fell from a year ago, but remains above 2,200, the latest Short-term Energy Outlook shows.
According to the just-released STEO, total DUCs in Appalachia (including the Marcellus and Utica Shale plays), Bakken, Eagle Ford and Permian plays for October was 2,245, 83 wells or 3.6% from 2,328 in October 2023. The latest total was down 13 wells, or 0.6%, from 2,258 in September 2024.
Three of the four plays recorded a year-over-year drop, led by the Eagle Ford, down 87 wells, or 26.8%, at 312, from 399 a year ago. The latest total also was down two wells, or 0.6%, from September 2024’s 314 total, the STEO reported.
The Bakken’s total DUCs fell to 309 last month, down 41 wells, or 11.7%, from 350 one year ago. The latest total also was down eight wells, or 2.5%, from 317 DUCs in September 2024.
Appalachia year-over-year fell eight DUCs, or 1.1%, to 739 from 747 one year ago. The latest total is 11 wells, or 1.5%, below September 2024’s 750 DUCs total.
The Permian play saw its DUCs total rise from October 2023 to October 2024, to 885 from 832, a 53-well, or 6.4%, increase. Last month’s total was up eight wells, or 0.9%, from September 2024’s 877 total, STEO reported.
PA Permits November 11, to November 20, 2024
County Township E&P Companies
1. Lycoming McHenry EQP
2. Lycoming McHenry EQP
3. Lycoming McHenry EQP
4. Lycoming McHenry EQP
5. Lycoming McHenry EQP
6. Lycoming McHenry EQP
7. Susquehanna Auburn Chesapeake
8. Washington Blaine Range
9. Washington Blaine Range
10. Washington Blaine Range
11. Washington Smith Range
12. Washington Smith Range
13. Washington Smith Range
14. Washington Smith Range
15. Westmoreland Penn Olympus Energy
16. Westmoreland Penn Olympus Energy
OH November 10, to November 16, 2024
County Township E&P Companies
1. Noble Buffalo EAP OHIO
2. Noble Buffalo EAP OHIO
3. Noble Buffalo EAP OHIO
4. Noble Buffalo EAP OHIO
WV Permits November 11, to November 15, 2024
1. Harrison Diversified Prod.
2. Wetzel EQT
