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Author: <span>Shiloh</span>

Texas RRC Says It’s First in Nation to Utilize Federal Funds to Plug Even More Abandoned Oil and Gas Wells

October 19, 2022 — Texas became the first state in the nation to begin plugging abandoned oil and gas wells using federal grants from the Infrastructure Investment and Jobs Act.

Plugging work began last week on an abandoned oil and gas well in Refugio County in South Texas. The RRC anticipates the initial grant will be used to plug approximately 800 abandoned wells. These would be in addition to 1,000 wells the agency anticipates will be plugged this year by the successful State Managed Plugging Program (SMP), using industry fee and fine revenue from the Oil and Gas Regulatory and Cleanup Fund.

“The RRC’s success and expertise with SMP was instrumental in quickly standing up the plugging project using federal funds,” said Clay Woodul, RRC Assistant Director of the Oil and Gas Division for Field Operations. “Our established workplans and contracting will continue to help ensure neighborhoods and the environment across Texas are kept safe through our well plugging work.”

 


Well plugging work in Refugio County utilizing federal grants.

The RRC has a web page on the federal grant funds for abandoned oil and gas well plugging. That page is at the following link: https://www.rrc.texas.gov/oil-and-gas/environmental-cleanup-programs/federally-funded-well-plugging/

 

Energy Prices Expected to Rise As Winter Approaches

By Alex Mills

As winter approaches, energy forecasters expect colder than average temperatures and higher energy prices.

The Energy Information Administration at the U.S. Department of Energy releases is Short-Term Energy Outlook stating it will be 2% colder this winter than the average temperature during the last 10 years. Colder weather will increase demand for energy and rising prices.

“Compared with last winter, in nominal terms, we forecast expenditures for homes that heat with natural gas will rise by 28%, heating oil by 27%, electricity by 10%, and propane 5% from October–March,” EIA stated.

EIA expects U.S. sales of electricity to ultimate customers to rise by 2.7% in 2022, mostly because of more economic activity but also because of slightly hotter summer weather than last year….
 

Sage Creek Energy Prepares for New East Texas NatGas Storage Facility

October 18, 2022 — Houston- and Flower Mound-based Sage Creek Energy Partners has applications in to the Railroad Commission of Texas for the first new gas storage facility to be developed in Texas in more than a decade.

Sage Creek said on Tuesday that its planned Trinity Gas Storage facility in East Texas would have an initial capacity of about 24 Bcf and will be instrumental in “balancing the ever-growing renewable energy supply in Texas and in providing safe and reliable gas service for the benefit of the residents, businesses, and industry in Texas.”

Trinity commercial operations are expected to begin in the second quarter of 2024, and the company said the facility can ultimately be expanded to over 50 Bcf of working gas capacity with firm, uninterrupted delivery of natural gas in excess of 1.75 Bcf/d……
 

Diamondback To Raise $1.1 Billion With Senior Notes

October 17, 2022 — Diamondback Energy announced on Monday that it’s priced an offering of $1.1 billion in aggregate principal amount of 6.250% senior notes, to mature on March 15, 2033 (price to the public is 99.572% of the principal amount).

The company says it intends to use the net proceeds to fully fund the redemption of all of Rattler Midstream LP’s outstanding 5.625% Senior Notes due 2025 and will also use proceeds for “general corporate purposes, including, without limitation, paying a portion of the cash consideration for the pending acquisition of certain oil and natural gas assets from FireBird Energy LLC upon closing (if it occurs)”….
 

U.S. Oil, Natural Gas Production Nears Record

By Alex Mills

Crude oil and natural gas production in the U.S. are headed for new records in 2022 and 2023 as the industry continues to show strength following the crash during the pandemic two years ago.

“U.S. production surges,” World Oil magazine stated in its recently released annual analysis. “Despite a sizeable drop in recoverable resources, U.S. oil production remains on track for a record in 2023, even as output grows more slowly than anticipated amid increased costs and labor shortages in America’s shale fields.”

The report projects an increase of 840,000 barrels of oil per day (bopd) in 2023 reaching an all-time high of 12.7 million bodpd, which exceeds the previous record of 12.3 million bopd in 2019.

Dry natural gas production has been rising since the first quarter of 2022, when it averaged 94.6 billion cubic feet per day (Bcfd). The Energy Information Administration (EIA) forecasts U.S. natural gas production to average 99.0 Bcfd during fourth-quarter 2022 and then rise to 100.4 Bcfd in 2023….
 

Advances in technology led to record new well productivity in the Permian Basin in 2021: EIA

October 3, 2022 — “The Permian Basin in western Texas and eastern New Mexico is one of the world’s most prolific unconventional oil- and natural gas-producing regions. The Permian Basin has become more productive because of the technological advancements in drilling and completion techniques, which allow operators to economically extract hydrocarbons from the low permeability reservoirs,” the US Energy Information Administration said on Friday.

“The stacked reservoirs of the Permian Basin, and the Delaware and Midland subbasins within it, vary in thickness and depth. Improved geological understanding, known as subsurface delineation, helps operators place wells to optimize well spacing in the most productive areas…..
 

O&G Tax Income Continues Increasing Boon for Texas

October 3, 2022 — Natural gas tax income for the State of Texas was up 91% year-over-year during the month of September, according to the latest figures from Comptroller Glenn Hegar‘s office.

Overall state sales tax revenue totaled $3.69 billion in September, 17.2% more than in the same month of 2021, with the majority of that sales tax revenue based on sales made in August and remitted to the agency in September.

Natural gas production tax totaled $480 million, up 91% from a year ago.

And the state’s oil production tax income was $552 million, up 41% from September 2021.

Motor fuel taxes were up 2% year-over-year at $328 million, up 2 percent from September 2021.

Meanwhile motor vehicle sales and rental taxes were up 13% year-over-year at $616 million.
…
 

Texas AG Joins In FERC Letter Protesting Increased Electrical Grid Oversight

October 1, 2022 — Texas Attorney General Paxton’s office is joining several other states in sending a letter to the Federal Energy Regulatory Commission (FERC) in protest of a proposed rule to advance what Mr. Paxton’s office called “the Biden Administration’s radical climate agenda.”

“By granting increased electrical grid oversight to FERC, the proposed rule would compromise individual states’ ability to determine on their own the most efficient mix of energy sources for their electrical grids. The new rule also forces states to cover the costs of expensive regional transmission lines to support so-called “green” energy generation, even when such expenditures contradict the state’s needs and decrease grid efficiency and reliability,” the AG’s office said on Friday….
 

Biden’s Energy Policy Reduces America’s Energy Security: Alex Mills

By Alex Mills

September 29, 2022 — President Joe Biden is playing Russian roulette with America’s energy future. He has implemented policies designed to replace reliable energy sources with unproven renewables and depleted more than half the Strategic Petroleum Reserve, which was implemented to serve as an insurance policy in the event of a catastrophe.

Fossil fuels – crude oil, natural gas and coal – have provided a majority of the nation’s energy needs for decades, and they currently generate 80%.

Petroleum products became such an important part to America’s economy and national security the U.S. Congress authorized the creation of the SPR in 1975 with the intention of protecting against energy supply interruptions in the future.

The SPR consists of four underground salt caverns in Texas and Louisiana near the Gulf coast. It was finished in 1977 and it is authorized to hold up to 714 million barrels of unrefined crude oil. Its largest capacity was reached on Dec. 27, 2009 at 727 million barrels.
 

Artificial intelligence predicts algae potential as alternative energy source: Texas A&M

September 28, 2022 — Texas A&M AgriLife Research scientists are using artificial intelligence to set a new world record for producing algae as a reliable, economic source for biofuel that can be used as an alternative fuel source for jet aircraft and other transportation needs.

Joshua Yuan, Ph.D., AgriLife Research scientist, professor and chair of Synthetic Biology and Renewable Products in the Texas A&M College of Agriculture and Life Sciences Department of Plant Pathology and Microbiology, is leading the research project.

The team’s findings were published in January in Nature Communications. Ongoing research is funded by the U.S. Department of Energy Fossil Energy Office. The work is also being funded by a gift from Dr. John ’90 and Sally ’92 Hood, who recently met with Yuan to discuss his biofuels research program. The gift is managed by the Texas A&M Foundation.….
 

Silver Hill Energy Partners, LP Closes $1.02 Billion Fund Focused on Direct Investments in Premier Oil and Gas Basins Across the US: Press Release

September 21, 2022 — Dallas – Silver Hill Energy Partners, LP (“Silver Hill”), announced today that it has closed the franchise’s third partnership and first institutional private equity fund, Silver Hill Energy Partners III, LP (the “Partnership”), representing total capital commitments of $1,020,000,000. The Partnership has formed Silver Hill Energy Partners III, LLC, Silver Hill III Midstream, LLC and other regional affiliates (together with the Partnership, “Silver Hill III”), which is focused on the direct acquisition and development of operated onshore oil, natural gas and related infrastructure assets in premier basins across the U.S….