Latest facts and a rumor from the Marcellus, Utica, and Permian, Eagle Ford Plays
Renewable Natural Gas Solution to Climate Change. There Are No Downsides. Imagine if burning natural gas actually reduced carbon emissions and can be transported via the nations existing natural gas pipelines to factories, commercial buildings, power generators, and our homes. So what is the downside?
As organic matter decomposes, it gives off primarily natural gas – methane and carbon dioxide. Large sources of decomposing matter include landfills, livestock (cattle, dairy, pig and chicken) farms, wastewater treatment plants and variety of farming and forestry sectors.
The methane generated by decomposition is traditionally is allowed to leak into the atmosphere. Methane is a potent greenhouse gas with warming potential 25–34 times greater than carbon dioxide, according to University of Utah data. Avoidance of methane emissions gives RNG a negative carbon intensity. A fuel with no downsides.
There are no downsides, Renewable Natural Gas (RNG) also named biogas and sustainable natural gas is undergoing rapid growth. An Industry Research report, released earlier this year forecasts RNG growth at a CAGR of 44%. Major oil and gas companies such as BP are jumping in; BP recently acquired landfill RNG leader Archaea Energy.
Yet the scope of opportunity is staggering; making room for many local players. The EPA reports the U.S. has 3,000 active landfills, while US Farm Data states the country has more than 60,000 dairy farms. There is plenty of opportunity for “mining” these sources of natural gas.
RNG also provides benefits in terms of fuel security, improved local air quality and brings communities into the climate change fight all with local economic benefits – jobs. A typical RNG project, according to industry sources, can cost between $10 and $100 million, generating both construction and operating jobs in local communities.
According to the Coalition for Renewable Natural Gas (CRNG), there are more than 500 RNG facilities in North America operating, under construction or planned, located in 46 states and three Canadian provinces.
2022 in Review: The Year the Energy Transition Went Off the Rails. Forbes. All you need to know about how the vaunted ‘energy transition’ is going as 2022 comes to its merciful close is to read the headline of a Reuters story published last week: “Global coal consumption to reach all-time high this year – IEA”. That isn’t how the narrative surrounding the energy transition assumed this would all be going in the year 2022. Certainly, it isn’t how IEA head Fatih Birol has wanted it to go, given his insistence that “more wind and solar” is the answer to seemingly every energy-related question. When global coal consumption hit its previous peak in 2013, the IEA and most other proponents of a shift from fossil fuels to renewables subsidized heavily by trillions of printed dollars and euros assumed it was a peak that would never again be reached. Not only was it exceeded during 2022 according to the IEA, but the global agency expects consumption to remain at similarly elevated levels through 2025. Demand for crude oil also continues to rise around the world. In its November 2022 report, OPEC projects 2023 global crude demand to increase by 2.2 million barrels per day to a record high of 101.3 million bopd. Then there’s that “other” fossil fuel, natural gas. As with oil and coal, the IEA projects that global demand for this cleanest-burning fossil fuel will hit record highs in 2022 and 2023.
NatGas Prices Plunge. Natural-gas prices plunge as unseasonably warm weather is forecast. Wall Street Journal. A sudden thaw across the Northern Hemisphere has melted down natural-gas prices, upending dire forecasts of energy shortages and sinking Vladimir Putin‘s plan to squeeze Europe this winter. Natural-gas futures for February delivery dropped 11% on Tuesday to end at $3.988 per million British thermal units. That is down more than 50% from summer highs and is about what gas cost a year ago, when temperatures were also warmer than normal and before Russia’s invasion of Ukraine jolted energy markets. The plunge is a bad omen for drillers, whose shares were among the stock market’s few winners last year. Cheaper gas is good news for households and manufacturers whose budgets have been busted and profit margins pinched by high fuel prices. Falling natural gas prices should help to cool inflation in the months ahead.
NatGas & Oil Flat in 2023. U.S. oil and gas is in no hurry to grow. Oil Price. Opinion. Last year was a rather surprising one for those used to seeing a short and visible link between oil prices and U.S. oil production. In 2022, this link broke. Despite higher oil prices, U.S. drillers did not go into full growth mode. And they ended the year in much the same way. According to the latest Dallas Fed energy survey, the pace of growth in the U.S. oil and gas industry slowed in the fourth quarter of the year even though many of the biggest challenges the industry had faced during that year had been eliminated. This view reflected a report by the Energy Information Administration, which said in December last year that even though oil output from the Permian would reach a record 5.6 million bpd this month, it would constitute a third of the growth rate in Permian output for last September.
Pioneer Cuts Forecast. Pioneer cuts long-term Permian Basin oil-output forecast. Bloomberg. The company had previously projected 8 million barrels a day. Pioneer Natural Resources Co., one of the biggest producers in the Permian Basin, has lowered its long-term projection for output from the entire region. Chief Executive Officer Scott Sheffield said Thursday his company now sees Permian production of about 7 million barrels a day by 2030, down from a previous view of 8 million barrels.
European NatGas Plunges Also. TTF Plunges to lowest level since 2021 as natural gas supply outlook strengthens – LNG recap. NGI. European natural gas prices hit the lowest level since 2021 on Tuesday as warmer weather has eased concerns that the region won’t have enough of the fuel to make it through winter. The Dutch Title Transfer Facility (TTF) February contract fell to nearly $22/MMBtu on Tuesday. That’s a low not seen since November 2021 before Russia invaded Ukraine and sent natural gas prices soaring to record highs on supply fears. Unseasonably warm weather has weighed down TTF in recent weeks, giving the market a reprieve and a chance to build storage inventories during the heating season.
Exxon and Chevron Focus on the Americas. Oil majors Exxon and Chevron shift focus to Americas. Oil Price. Exxon and Chevron are betting big on oil and gas assets in the Americas as they seek to capitalize on abundant resources with good returns closer to home. Both U.S. supermajors have said in their releases about the 2023 capital budget allocation that they would focus on the Permian and a handful of oil and gas projects in North and South America. Over the past year, Exxon quit Russia after the Russian invasion of Ukraine, and Chevron saw its concession agreements in Indonesia and Thailand expire. In the past few years, Chevron has sold assets in the UK, Denmark, and Brazil, among others, according to The Wall Street Journal. Exxon, for its part, has either sold or is trying to sell assets in Nigeria, Egypt, and Chad, among others.
BP Boosting U.S. Investments. BP plans to boost oil and gas investments in the US. Offshore Technology. British oil major BP is planning to increase investments in its oil and gas production assets in the Gulf of Mexico and Texas. The move comes in response to the US government’s request to energy companies to increase oil supplies in order to reduce fuel prices, as inflation costs hit the industry, reported Reuters. As part of the latest plan, BP intends to increase investments in onshore oil and gas business, mostly in Texas, by 41% to $2.4bn in 2023, from $1.7bn in 2022, the oil major said in its ‘US Impact Report’. The firm also plans to increase investments in its assets in the Gulf of Mexico to an average of $2.3bn annually from 2023 to 2025. In the past five years, BP has invested $2bn per annum in the region.
EQT’s Production Cut 30% by Storm. America’s biggest gas producer sees 30% output cut over storm. Oil Price. America’s largest natural gas producer, EQT Corp, has experienced a plunge in production up to 30% due to severe cold weather that led to Appalachian Basin well disruption, Bloomberg reports. Speaking to Bloomberg Television on Wednesday, EQT Chief Executive Officer Toby Rice said output fell by between 1 billion and 1.5 billion cubic feet per day amid the extreme cold snap that started last week with a blast of Arctic air and strong winds leading to subzero temperatures affecting an estimated 150 million people. In Q3 2022, EQT was producing around 5 billion cubic feet per day. The EQT executive is using this loss of production as a public stage for slamming renewable power sources, which he told Bloomberg “didn’t show up”, applauding the natural gas industry’s ability to respond quickly to severe weather conditions and calling for more natural gas pipelines to shore up heating and power supplies.
U.S. Net Oil Exporter in 2023. The U.S. could become a net oil exporter in 2023. Oil & Gas 360. The United States hasn’t been a net exporter of oil and oil products since World War II. Now, it is on course to become a net exporter next year, with oil and product exports already hitting record highs of 3.4 million bpd and 3 million bpd respectively. Meanwhile, Reuters reports, citing official data from the Energy Department, imports of crude oil are on a decline, falling to just 1.1 million barrels daily in November. That’s compared with some 7 million bpd in crude imports five years ago. In fairness, the export-import balance this year was substantially affected by the massive 180-million-barrel release of crude oil from the strategic petroleum reserve, which the Biden administration used to fight soaring retail fuel prices. The expectation that the U.S. will become a net exporter of oil hinges on one big assumption: a faster ramp-up of shale oil production.
Shale Bosses Worried About Workers in 2023. Shale bosses worried about US labor shortages going into 2023. Bloomberg. US shale executives remain concerned about the outlook for rising costs going into 2023 as they continue to struggle with hiring and retaining workers, according to the Federal Reserve Bank of Dallas. A majority of respondents polled in the bank’s latest quarterly energy survey, which was released Thursday, said they expect to increase capital spending slightly or significantly next year compared with 2022 levels. And while most also see West Texas Intermediate oil at $80 per barrel or higher at the end of next year — levels that are above the current price — underlying inflation and supply chain issues punctuated by labor shortages also make major production hikes unlikely
$121 Oil When China Fully Reopens. Dan Yergin says oil prices could hit $121 a barrel when China fully reopens. CNBC. Dan Yergin predicts oil prices could hit $121 a barrel when China fully reopens, but warned there are three major uncertainties looming over the market. “Our base case for 2023 is $90 for Brent but you have to look at other cases,” the S&P Global vice chairman said, adding there are three major uncertainties: the Federal Reserve’s decisions, China demand and Moscow’s reaction to the price caps. “If China gets over Covid … then you add a lot of demand to the market,” Yergin told CNBC’s “Street Signs Asia” on Tuesday. That could be “one big boost” and push prices to $121 a barrel, building on strains caused by underinvestment in oil and gas, Yergin said. That would be near highs set in March after Russia invaded Ukraine.
Oil Execs 2023 Survey. US energy execs see crude at $84/b by end 2023, nat. gas $5.64/mmBtu – survey. Quantum Commodity Intelligence. Oil and gas executives operating in the southern oil-producing states of the US expect energy prices to recover from current levels during 2023, according to a survey published by the Federal Reserve Bank of Dallas Thursday. The Dallas Fed collected the price forecasts in its latest energy survey of exploration and production (E&P) and oilfield services (OFS) firms across the Federal Reserve’s three-state Eleventh District, which includes the oil-rich Permian Basin and the Haynesville Shale gas-producing region. On average, respondents expect a WTI oil price of $84/b by year-end 2023, compared to current monthly futures prices ranging from $76/b-$78/b, while responses ranged from $65/b-$160/b.
SPR Lowest Level Since 1983 U.S. emergency oil stockpiles drop to lowest level since 1983 as gas prices tick up. Fox Business. The Strategic Petroleum Reserve (SPR) fell to its lowest level since 1983 last week as U.S. gasoline prices and oil prices ticked up, according to federal data released Wednesday. The level of the SPR — an emergency stockpile of crude oil managed by the Department of Energy (DOE) — declined to 375.1 million barrels last week, marking the first time it has fallen below 378 million barrels since December 1983, according to the Energy Information Administration. Prior to last week, the reserve’s lowest level since 1983 was recorded on Dec. 30, 1983, when it hit 378.3 million barrels. Meanwhile, the average pump price nationwide ticked up for the second consecutive day Wednesday, hitting $3.13 per gallon, according to a AAA database.
GOP Positive on Energy Agenda. Despite speaker chaos, GOP has high hopes for energy agenda. E&E News. The turmoil engulfing House Republicans this week is a bad sign for the party’s legislative agenda, but some top lawmakers believe energy and environment issues could unify the GOP. After two days of voting, Rep. Kevin McCarthy (R-Calif.) is no closer to becoming speaker, with a group of 20 or so conservatives are blocking him from reaching a majority. It leaves the chamber effectively stuck in neutral: It has no formal rules and no ability to advance legislation. Committees are unable to function. “It’s probably a precursor to how difficult it will be to get some legislation passed,” incoming House Natural Resources Chair Bruce Westerman (R-Ark.) said in an interview Wednesday. Electing the speaker, he said in all sincerity, “is the easy part.” Despite that pessimism, some Republicans believe that energy legislation could be a way to bring the party together. After all, nearly all House Republicans want to roll back regulations and increase energy production on federal lands.
OH Shale Investment $100B. Report: nearly $100B in Ohio shale investment. The Business Journal. Ohio’s shale gas industry has led the nation in growth for the past four years due to large Utica and Marcellus shale deposits, according to a new report released Friday by JobsOhio and Cleveland State University. The Ohio Shale Investment Report shows that the natural gas and oil industry has put nearly $100 billion in investments into the state. An investment of $2.5 billion was invested between last July and December alone, the report found.
Sempra to Send LNG to Mexico. Sempra gets DOE export permissions for LNG projects in Mexico. Oil & Gas Journal. The US Department of Energy (DOE) has granted Sempra Infrastructure’s 4-million tonne/year (tpy) Vista Pacifico LNG plant permission to export natural gas to countries not having a free trade agreement (non-FTA) with the US. DOE granted FTA export authority for both in 2021. It also authorized an increase the volume of previously granted permissions for Sempra to export from its Energia Costa Azul plant. These permissions will remain in place through 2050. Vista Pacifico in Topolobampo, Sinaloa, on Mexico’s west coast, will include one liquefaction train with a gas pretreatment unit, a 180,000-cu m LNG storage tank, a marine jetty, ground flare equipment, and connective piping and infrastructure. Sempra plans to begin exports in 2027.
Permian Reduces Methane. New report: Permian continues to reduce methane emissions. Midland Reporter Telegram. Permian Basin oil and natural gas operators continue to show significant improvements in their methane emissions, according to a report issued Wednesday. Texans for Natural Gas (TNG), a project of the Texas Independent Producers and Royalty Owners Association (TIPRO), released its annual methane emissions intensity analysis Wednesday, finding the Permian Basin’s rate has fallen by more than 76% from 2011 to 2021, even as production increased by more than 345% in the same period. The report also found the Permian Basin is cleaner than its global competitors even with its prolific production. In 2021, compared with the Permian Basin, flaring intensity was 2,621% higher in Venezuela and 339% higher in Russia, according to the report. According to the report, the Permian Basin was helping the US exceed other nations in reducing flaring volumes. Of the top 10 countries by flared volumes, the US has made more progress in reducing its emissions, cutting volumes 49.3% from 2019 to 2021.
Freeport LNG Export Terminal Restart End of January. Thanks, MDN. The Freeport LNG export terminal, located in Quintana Island, Texas, has been offline and not producing LNG since June 2022 due to an explosion. Freeport has changed its estimated restart date multiple times. In early December, Freeport swore up and down that it would begin to return to service by the end of 2022. Yeah, well, that didn’t happen. Two days before Christmas, when everyone was getting ready to head out the door for the holiday, Freeport dropped another announcement…
PA December 12, 2022 to January 5, 2023
County Township E&P Companies
1. Butler Allegheny Lola Energy
2. Butler Allegheny Lola Energy
3. Butler Allegheny Lola Energy
4. Butler Allegheny Lola Energy
5. Greene Wayne Rice
6. Indiana Armstrong INR OPR
7. Indiana Armstrong INR OPR
8. Indiana Young INR OPR
9. Susquehanna Franklin SWN
10. Susquehanna Franklin SWN
11. Tioga Hamilton Repsol
12. Tioga Hamilton Repsol
13. Tioga Hamilton Repsol
14. Tioga Hamilton Repsol
15. Tioga Union PA Gen Energy
16. Tioga Union PA Gen Energy
17. Tioga Union PA Gen Energy
18. Tioga Union PA Gen Energy
19. Tioga Union PA Gen Energy
20. Tioga Union PA Gen Energy
21. Tioga Union PA Gen Energy
22. Washington Cecil Range
23. Washington Cecil Range
24. Washington Morris Range
25. Washington Morris Range
26. Washington Morris Range
27. Washington Morris Range
28. Washington Morris Range
29. Westmoreland Bell CNX
30. Westmoreland Bell CNX
31. Westmoreland Bell CNX
32. Westmoreland Bell CNX
33. Westmoreland Salem Apex Energy
34. Westmoreland Salem Apex Energy
35. Westmoreland Salem Apex Energy
OH Permits December 11, to December 24, 2022
County Township E&P Companies
1. Belmont Mead Ascent
2. Belmont Pease Gulfport
3. Belmont Pease Gulfport
4. Belmont Pease Gulfport
5. Belmont Pease Gulfport
6. Carroll Center EAP OHIO
7. Carroll Center EAP OHIO
8. Guernsey Wills Utica Resources
9. Guernsey Wills Utica Resources
10. Guernsey Wills Utica Resources
11. Harrison Cadiz Ascent
12. Harrison Green Ascent
13. Harrison Green Ascent
14. Harrison Green Ascent
15. Harrison Green Ascent
16. Harrison Green Ascent
17. Harrison Green Ascent
18. Harrison German EAP OHIO
19. Harrison German EAP OHIO
20. Harrison German EAP OHIO
21. Harrison German EAP OHIO
WV Permits December 19, to December23, 2022
1. Monongalia Northeast Nat. Res
2. Monongalia Northeast Nat. Res
3. Monongalia Northeast Nat. Res
4. Monongalia Northeast Nat. Res
5. Monongalia Northeast Nat. Res
6. Tyler Antero
7. Tyler Antero
8. Tyler Antero
9. Tyler Antero
10. Tyler Antero
11. Tyler Antero
12. Wetzel Antero
