.The Texas Energy Report

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.The Texas Energy Report

Crude Oil Faces Another Critical Deadline

By Alex Mills

Next week will be critical for the oil industry as the June contracts expire on Thursday, May 19, for West Texas Intermediate traded on the New York Mercantile Exchange. On April 20, the last day of trading for May contracts, WTI closed at -$37 per barrel. It was the first time crude oil had closed in negative territory.

The oversupply of oil has become severe with little storage capacity available. U.S. Secretary of Treasury Steve Mnuchin called it a “classic supply and demand imbalance” because of the oversupply of oil and low demand.

Crude oil is traded, bought, sold all over the world, and the price varies from day-to-day and location-to-location. Most news sources report the futures price quoted for “front month” delivery on NYMEX. However, speculators can put contracts on “forward months” going 60 days, 90 days, or even a year into the future. Traders who do not sell their contracts must take possession of the oil. On average, only 1 percent of the contracts on the futures market exchange “wet” barrels. The other 99 percent are traded electronically and physical possession of oil never changes…..
 

Texas RRC Approves 10-Year Oil Tax Credit for Use of Green EOR Technology: Press Release, Locus Bio-Energy Solutions

May 14, 2020

As operators scramble to cut costs, the Texas Railroad Commission (RRC)—which oversees all oil & gas operations in the state, including the top U.S. oil producing Permian Basin, voted to approve a new 10-year H13 tax credit for use of a green EOR technology. Known as the AssurEOR program and developed by Houston-based oil innovation start-up Locus Bio-Energy Solutions, the biosurfactant treatments are the first cost-effective and environmentally friendly products proven to sustainably increase oil production by 40% or more and extend the lifespan of declining wells—boosting revenue and financial stability…..
 

Stanford students turn oil wells into batteries, bring solar to Nigeria in energy entrepreneurship class — Stanford News

BY MATTHEW VOLLRATH

 

May 14, 2020

In the winter of 2019, Kemp Gregory, a graduate student in Civil & Environmental Engineering at Stanford University, got a call from Walker Colt. Friends since childhood, they had both begun their careers as petroleum engineers in Houston, Texas, but hoped to transition to something greener. Now, Colt had an idea for how they could do that…..
 

Pedernales Electric Cooperative Launches COVIS-19 Relief Fund

May 14, 2020

The COVID-19 pandemic has transformed lives across the world, including many here at home in Central Texas. As some PEC members are experiencing the health and financial hardships of the virus, the cooperative is launching the PEC COVID-19 Relief Fund.

To help those affected, you can now donate to help your neighbors in need pay their electric bill. These funds will be distributed through PEC’s Member Assistance Program, to provide bill assistance to members impacted by COVID-19.

“At PEC, we strongly believe in the power of community and have seen our members embrace the cooperative spirit,” said CEO Julie Parsley. “Making a voluntary donation is one way you can help other PEC members impacted by this virus. Together we’ll make a difference.”….
 

Tough Times for Oil Companies Trying to Survive the Pandemic

By Alex Mills

 

May 12, 2020

Just a few years ago the head of ExxonMobil had to appear before a Congressional committee to explain their billions of dollars in profits that some called “obscene.”

This week investors in ExxonMobil are asking why the company did not make any profit during the first quarter of 2020. Its $610 million dollar loss is the first time that ExxonMobil reported a loss in more than 30 years.

ExxonMobil isn’t the only oil company reporting financial troubles. Actually, there are more losers than winners.

The United States Oil Fund, the largest crude exchange traded product, said recently it will sell all of its 30-day contracts to avoid a repeat of the heavy losses that occurred around the expiration of the May contract on April 20 when the price of oil bottomed out at -$37 per barrel.

Crude oil inventories continue to rise indicating the oversupply is still expanding. The Energy Information Administration reported on Wednesday inventories increased by 4.6 million barrels from 527 million barrels to 532 million barrels. It is the 14 consecutive week that inventories increased.”….
 
 

RRC Commissioners Assess $800,000 in Penalties: RRC

May 10, 2020

AUSTIN – The Railroad Commission of Texas assessed $801,781 in fines involving 146 enforcement dockets against operators and businesses at the Commissioners’ Conference on May 5. The Commission has primary oversight and enforcement of the state’s oil and gas industry and intrastate pipeline safety.

Twenty-one dockets involved$386,847 in penalties after operators failed to appear at Commission enforcement proceedings. Details on these Master Default Orders can be found on the RRC website here.

Operators were ordered to come into compliance with Commission rules and assessed $137,934 for oil and gas, LP-Gas or pipeline safety rule violations. Pipeline operators and excavators were assessed $277,000 for violations of the Commission’s Pipeline Damage Prevention rules. Details on all these Master Agreed Orders can be found on the RRC website here.

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

Railroad Commission Launches Drone Program to Enhance Emergency Response: RRC

May 10, 2020

Taking advantage of 21st century technology, the Railroad Commission of Texas launched a statewide drone inspection team last month. Drones will help inspectors to quickly respond and inspect sites that are unsafe or inaccessible during emergencies such as fires, flooding and other natural disasters. Drones can also assist in situations, such as the current COVID-19 pandemic, where they provide an alternative to in-person inspections…..