.The Texas Energy Report

By Alex Mills

Retail gasoline prices are more than $1 per gallon lower this Memorial Day weekend than last year, and AAA expects more traffic on the highways.

AAA expects 6% more Memorial Day weekend road trips in 2023 than in 2022.

Even though U.S. retail gasoline prices are lower than 2022, prices are relatively high compared to previous years according to a report from the Energy Information Administration (EIA).

“Heading into Memorial Day weekend 2023, the U.S. retail gasoline price averaged $3.53 per gallon, or $1.24 (26%) lower than the inflation-adjusted price one year ago,” EIA stated in its report issued on Wednesday.

“Despite this price decrease, retail gasoline prices remain relatively high. This year’s price is higher than the inflation-adjusted prices of $3.38 in 2019, $2.22 in 2020 (when responses to the COVID-19 pandemic decreased demand for petroleum products), and $3.41 in 2021,” EIA stated.

Gasoline prices follow crude oil prices closely. When market conditions for both commodities are tight prices tend to follow. In recent years, a global pandemic and Russia’s invasion of Ukraine have played key roles in energy prices….
 

May 25, 2023 — The Supreme Court on Thursday ruled against the Environmental Protection Agency in a dispute over its authority to regulate certain wetlands under the Clean Water Act, long seen as a key tool to protect waterways from pollution…
 

May 25, 2023 — A bill passed by the Texas Legislature to continue the Texas Produced Water Consortium has been signed by Governor Greg Abbott, to go into effect immediately. The Texas Senate …

May 25, 2023 — The Railroad Commission of Texas will have the authority to designate the operators of orphaned oil or natural gas wells under a bill signed into law by Governor Greg Abbott over the weekend.

SB 1210, from District 29 Sen. César Blanco, would allow a geothermal operator to adopt such wells in order to convert the well into geothermal electricity production….
 

May 25, 2023 — The Texas Legislature has passed the PUC Sunset Bill in modified form and is preparing to send the bill to the Governor. There were a number of amendments to …

May 25, 2023 — The Texas Legislature has passed and sent to the Governor a bill to put off new federal regulations on state O&G production.

HB 33, which author Rep. Brooks Landgraf calls the “Texas Energy Independence Act,” was passed by the House May 5th and by the Senate May 22nd, and would take effect September 1st.

The bill keeps Texas state agencies and officials from contracting with or even offering assistance to federal agencies or officials on the enforcement of federal statutes, rules, regulations or orders regulating O&G operations if the regulation does not already exist.

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In the EIA’s Issues in Focus: Effects of Liquefied Natural Gas Exports on the U.S. Natural Gas Market supplement to their Annual Energy Outlook 2023 (AEO2023), they find that the volumes of liquefied natural gas exports (LNG) do affect average U.S. natural gas prices. However, the resulting range in natural gas prices in our new cases was narrower than the price range in recent history and the AEO2023 side cases despite a wide variety of U.S. LNG export volumes.

In the EIA’s AEO2023, they explore long-term energy trends in the United States and present an outlook for energy markets through 2050. The Issues in Focus articles based on the AEO provide in-depth discussions on topics of special significance, such as LNG exports. This Issues in Focus presents three additional side cases to the AEO2023 that explore how LNG exports volumes affect domestic natural gas prices….
 

May 24, 2023 — A new bill ready to be signed by Governor Greg Abbott would eliminate the need for yearly non-commercial vehicle inspections of the horn, brakes, lights and all the rest …

May 24, 2023 — The Texas Legislature has passed a modified version of District 5 Sen. Charles Schwertner‘s and District 10 Sen. Phil King‘s SB 7, aimed at strengthening the ERCOT grid by instituting a procedure for incentivizing more gas-fueled power plants — and has also passed SB 2627 (see below)

The bill was passed by the Senate on April 5th and by the House on May 23rd and is now undergoing reconciliation as the Senate decides whether to meet with House representatives over changes the House made to the Senate’s version of the bill — or the Senate could simply accept without question those House changes….
 

May 24, 2023 — Gasoline and diesel fueled engines may not be outlawed in local jurisdictions under a new law signed by Governor Greg Abbott.

The Texas Senate passed SB 1017  by District 22 Sen. Brian Birdwell on April 5th and the House passed a modified measure on April 25th, after which the Governor signed the bill May 13th, outlawing any ban of gas stations along with any other similar or related wholesale or energy producer….
 

May 24, 2023 — Governor Greg Abbott has signed into law a bill that creates a cause of action and details a process governing “bad faith washouts” in releasing O&G royalty leases.

HB 450 from state Rep. Tom Craddick and others spells out how a person may file a lawsuit if that person can establish that he or she possessed was an overriding royalty interest right in an O&G lease and that the entity being sued and controlling the lease caused a washout of the overriding royalty in question — and it must be reasonably proven, then, that the entity being sued intentionally or knowingly caused that washout….
 

On a 119-21 (unofficial) vote with 2 (Moody, Phelan) voting present this evening, the Texas House passed its version of Senate Bill 7, low-interest loans meant to create incentives for gas-powered power plants — the bill limits net pricing built into the PCM to $1 billion a year

The House has also passed its version of SB 2627, allowing a bonus if plants are completed and hooked to the ERCOT grid by 2029 (with day-ahead and real-time pricing also part of the bill) — this bill was only introduced three weeks ago

And the House has passed …
 

May 19, 2023 — The Railroad Commission of Texas assessed $3,515,243 in fines involving 283 enforcement dockets against operators and businesses at the Commissioners’ Conference on Wednesday. The Commission has primary oversight and enforcement of the state’s oil and gas industry and intrastate pipeline safety.

Thirty-seven dockets involved $1,204,493 in penalties after operators failed to appear at Commission enforcement proceedings. Master Default Orders can be found on the RRC Hearings Division webpage.

Operators were ordered to come into compliance with Commission rules and assessed $1,625,800 for any oil and gas, LP-Gas, critical infrastructure, or pipeline safety rule violations. Pipeline operators and excavators were assessed $684,950 for violations of the Commission’s Pipeline Damage Prevention rules. Master Agreed Orders can be found on the RRC General Counsel webpage.

In the absence of timely motions for rehearing, decisions are final as stated in these final orders.

Texas Energy Report NewsClips Friday May 26, 2023 Asterisk (*) denotes news stories that may be inaccessible because portions are behind a paywall   Top Stories   Houston Chronicle – May 25, 2023 …

May 17, 2023 — The EIA estimates that U.S. propane consumption averaged 0.986 million barrels per day (b/d) during the 2022–23 winter heating season (October through March), the least for a winter heating season on record, starting in 2010. Reduced average winter U.S. propane consumption was influenced by less consumption during the coldest winter months of December, January, and February. Based on our recently released Petroleum Supply Monthly, U.S. propane consumption during those three months averaged 1.07 million b/d

May 17, 2023 — The Port of Corpus Christi says it’s preparing a nationwide search for a new CEO after Sean Strawbridge resigned Tuesday, effective June 2nd**, following what’s described as a “heated” meeting with the port board — word is there were “questions over spending”…
 

May 17, 2023 — No injuries were reported when a fire broke out at Valero‘s West Plant refinery at Corpus Christi on Wednesday.

Valero’s Corpus Christi refinery, which averages 293,000-barrel-a-day, is made up of East and West plants just a few miles from each other, working with different types of crude oil.

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May 15, 2023 — Governor Greg Abbott has signed into law the first Texas energy bill of the session, with SB 505, requiring new EV owners to pay $400 to register their vehicles …

May 15, 2023 – The Texas Legislature today gave preliminary approval to the Sunset legislation for the Texas Commission on Environmental Quality, an agency criticized for its light touch with corporate polluters at the expense of vulnerable people.

Senate Bill 1397 renews the TCEQ for another 12 years. The bill, which already cleared the state Senate, received initial approval from the Texas House today. Adrian Shelley, Texas director of Public Citizen, issued the following statement:

“Communities across Texas live with polluted air and water and the threat of chemical spills – or worse. During the past year, members of these communities pleaded with their elected officials to overhaul the TCEQ and finally protect their health. Lawmakers ignored the pleas, preferring the status quo in Texas — protection of polluters over people. Legislators passed on a once-in-a-decade opportunity to address a wide range of issues with a TCEQ that many say is not merely a reluctant regulator but a broken agency.

“Though the Legislature could have done more, the bright spots of the legislation that people in fenceline communities pushed for will now offer a little more protection to all Texans.”

A Public Citizen analysis identified the following favorable provisions in SB 1397:

• An increase in the maximum daily fine from $25,000 to $40,000
• Permit applications are posted online, and the comment period following a public meeting increased to 36 hours
• Compliance history review or permit suspension of a facility based on exigent circumstances.

Favorable improvements that the Legislature chose not to adopt include:

• Directing the TCEQ to consider the cumulative effects on health of approving multiple air permits in the same neighborhoods
• Removing “economic development” from the agency’s mission statement, which has led the agency to protect industry interests over public health
• Requiring the agency to consider environmental justice in permitting and enforcement.

May 15, 2023 — One person has died after a fire at the Marathon Petroleum Galveston Bay refinery in Texas City southeast of Houston.

It started about 9:30 Monday morning with fire crews arriving quickly and immediately spraying down the fire, according to one witness, who added the fire appeared to be under control within a couple of hours.

The blaze sent black smoke rising from the plant but officials did not call for nearby residents to shelter in place.

There are no details on the cause of the fire or the circumstances involving the one death, no have Texas City police said whether there were others injured — and of course officials have not released the identity of the person killed.

KHOU’s Gerald Harris said this afternoon that there are two people described as contract workers “undergoing evaluation” as a result of the fire.

So far air monitors have reported no danger to those nearby.

The statement this afternoon from Marathon Petroleum:

“We are deeply saddened to report that a Marathon employee has passed away as a result of the fire today at Marathon Petroleum’s Galveston Bay refinery.

“We extend our deepest sympathies to our employee’s family, friends and co-workers, and our thoughts are with them as we all mourn his passing.

“The safety of our workers and the community is our top priority, and a full investigation will be conducted to determine the cause of the incident.”