Sunday, December 29, 2019

January 2020 natural gas contract expires at an all time low

oil prices rose for the 4th week in a row and for the 7th week out of eight, underpinned by reports that showed larger than expected declines in U.S. supplies of crude and its products....after rising less than 1% to $60.44 a barrel last week as a US-China trade deal rally ended in profit-taking, the benchmark price of US light sweet crude for February delivery started out lower on Monday after Kuwait and Saudi Arabia agreed to renew crude output in the shared neutral zone along their border, but recovered to end 8 cents higher at $60.52 a barrel even as the Russian Energy Minister said the OPEC-led producer group might consider easing output cuts next year...oil traded higher in thin pre-Christmas trading on Tuesday, ahead of reports forecast to show crude stockpiles shrank, after Russia said cooperation with OPEC on supply cuts would continue and settled 59 cents, or 1%, higher at $61.11 per barrel amid renewed optimism that the US and China would soon finalize their trade agreement...oil prices opened higher after the holiday on Thursday after a late Tuesday report from the American Petroleum Institute showed crude inventories fell by much more than was expected and ended 57 higher cents at $61.68 a barrel, the highest price since mid-September drone attacks on Saudi-Arabia, as US stock market indices also closed at record highs...oil prices retreated from those three-month highs early on Friday, despite upbeat economic data from China and the US and optimism over a trade deal between the two, as traders awaited the EIA's oil inventory data, but then rebounded when the EIA reported a larger than expected draw from crude supplies and managed to end the day 4 cents higher at $61.72 a barrel...oil prices thus ended with a 2.1% gain on the week and higher for the 4th week in a row, now having increased nearly 14% since the end of October....

meanwhile, natural gas prices hit all time lows for the current front month contract three times this week, despite a much larger than normal withdrawal from storage, as near record warmth across most of the nation reduced heating demand heading into January...after closing last week 1.4% higher at $2.328 per mmBTU because weather models were indicating cooler weather two weeks out, the price of natural gas for January delivery opened 3% lower on Monday and continued falling to an all time low of $2.214 per mmBTU, down 11.4 cents on the day, on expectations of lower heating demand as weather forecasts had turned warmer...the selloff continued on Tuesday as natural gas prices fell another 2% to another all time low of $2.172 per mmBTU, as ongoing warmth kept the pressure on prices...however, a drop in production and a slightly cooler forecast sparked a wave of short-covering on Thursday, as gas prices jumped 12.2 cents to $2.294 per mmBTU...however, warm weather pushed prices lower again with the delayed release of the storage report on Friday, falling 13.6 cents to $2.158 per mmBTU on the day, as trading in the January contract expired at another all time low...

with natural gas prices for delivery in January thus expiring at an all time low, we'll include a price graph of that contract to see what it's recent history looks like....the graph we have below shows the weekly price of the January 2020 natural gas contract over the past 3 years...

December 28 2019 natural gas for January

the above graph is a screenshot of the interactive weekly price chart for the January 2020 natural gas contract at, "the leading provider of real-time or delayed intraday stock and commodities charts and quotes", and it shows the range of prices, in dollars per mmBTU, for that January natural gas contract as a vertical bar for each week over the past 3 might note that each bar has two small horizontal appendages: the one on the left is the opening price for the week the bar indicates, while the appendage on the right is the week's closing price...what we can see here is that up until May of this year, the contract price for January gas seldom sold at less than $3 per mmBTU, and up until a month ago it was seldom priced lower than $2.50 per mmBTU... now, with January arrival's imminent, the price of that gas contract has fallen to $2.158 per mmBTU, 17 cents lower than it had been priced at the end of the previous week...we should make clear that this graph shows the price of the January contract, which is historically the most expensive, and that mid-summer gas contract prices we have quoted earlier this year were occasionally lower priced...furthermore, even as January gas was falling more than 7% this week, the longer dated futures prices showed less downward movement...even the price of natural gas for February delivery, which will be quoted as "the price of natural gas" next week, only fell a net of 7.9 cents over the 4 trading days this week, and ended the week at $2.231 per mmBTU, 7.3 cents higher than January's gas price...although it did hit a contract low on Wednesday, traders priced it higher than January on the chance that winter will turn colder by then...

the natural gas storage report for the week ending December 20th from the EIA indicated that the quantity of natural gas held in storage in the US decreased by 161 billion cubic feet to 3,250 billion cubic feet by the end of the week, which still left our gas supplies 518 billion cubic feet, or 19.0% higher than the 2,732 billion cubic feet that were in storage on December 20th of last year, but 69 billion cubic feet, or 2.1% below the five-year average of 3,319 billion cubic feet of natural gas that has been in storage as of the 20th of December in recent years....the 161 billion cubic feet that were withdrawn from US natural gas storage this week was somewhat more than the average forecast for a 153 billion cubic feet withdrawal by analysts surveyed by S&P Global Platts, and quite a bit more than the average 101 billion cubic feet of natural gas that have been pulled from natural gas storage during the third week of December over the past 5 years. as well as way more than the 61 billion cubic feet withdrawal reported during the corresponding week in 2018...

The Latest US Oil Supply and Disposition Data from the EIA

US oil data from the US Energy Information Administration for the week ending December 20th indicated that because the increase in our net oil imports nearly matched the increased demand from refineries, we needed to pull oil out of our stored commercial supplies for the fifth time in the past fifteen weeks...our imports of crude oil rose by an average of 230,000 barrels per day to an average of 6,809,000 barrels per day, after falling by an average of 308,000 barrels per day during the prior week, while our exports of crude oil fell by an average of 236,000 barrels per day to an average of 3,397,000 barrels per day during the week, which meant that our effective trade in oil worked out to a net import average of 3,412,000 barrels of per day during the week ending December 20th, 466,000 more barrels per day than the net of our imports minus our exports during the prior week...over the same period, the production of crude oil from US wells increased by 100,000 barrels per day to 12,900,000 barrels per day, and hence our daily supply of oil from the net of our trade in oil and from well production totaled an average of 16,312,000 barrels per day during this reporting week..

meanwhile, US oil refineries were reportedly processing 16,980,000 barrels of crude per day during the week ending December 20th, 419,000 more barrels per day than the amount of oil they used during the prior week, while over the same period the EIA reported that a net average of 782,000 barrels of oil per day were being pulled out of the supplies of oil stored in the US....hence, this week's crude oil figures from the EIA appear to indicate that our total working supply of oil from net imports, from oilfield production, and from storage was 113,000 barrels per day more than what our oil refineries reported they used during the account for that disparity between the apparent supply of oil and the apparent disposition of it, the EIA inserted a (-113,000) barrel per day figure onto line 13 of the weekly U.S. Petroleum Balance Sheet to make the reported data for the daily supply of oil and the consumption of it balance out, essentially a fudge factor that they label in their footnotes as "unaccounted for crude oil", thus suggesting an error or errors of that magnitude in the oil supply & demand figures we ​have ​just transcribed...(for more on how this weekly oil data is gathered, and the possible reasons for that "unaccounted for" oil, see this EIA explainer)....   

further details from the weekly Petroleum Status Report (pdf) indicated that the 4 week average of our oil imports rose to an average of 6,566,000 barrels per day last week, still 11.5% less than the 7,423,000 barrel per day average that we were importing over the same four-week period last year....the 782,000 barrel per day net withdrawal from our total crude inventories was due to a withdrawal of 782,000 barrels per day from our commercially available stocks of crude oil, while the quantity oil stored in our Strategic Petroleum Reserve was unchanged......this week's crude oil production was reported to be 100,000 barrels per day higher at 12,900,000 barrels per day because the rounded estimate of the output from wells in the lower 48 states was 100,000 barrels per day higher at 12,400,000 barrels per day, while Alaska's oil production was unchanged at 481,000 barrels per day and hence added ​a rounded ​500,000 barrels per day to the rounded national total...last year's US crude oil production for the week ending December 21st was rounded to 11,700,000 barrels per day, so this reporting week's rounded oil production figure was 10.3% above that of a year ago, and 53.1% more than the interim low of 8,428,000 barrels per day that US oil production fell to during the last week of June of 2016...   

meanwhile, US oil refineries were operating at 93.3% of their capacity in using 16,980,000 barrels of crude per day during the week ending December 20th, up from 90.6% of capacity the prior week, and close to the recent average capacity utilization for the third week of December...however, the 16,980,000 barrels per day of oil that were refined this week were still 2.3% below the 17,350,000 barrels of crude per day that were being processed during the week ending December 21st, 2018, when US refineries were operating at 95.1% of capacity....

with the big increase in the amount of oil being refined, gasoline output from our refineries was also much higher, increasing by 429,000 barrels per day to 10,269,000 barrels per day during the week ending December 20th, after our refineries' gasoline output had increased by 87,000 barrels per day ​over ​the prior week....and with this week's big increase in gasoline output, our gasoline production was 1.2% higher than the 10,144,000 barrels of gasoline that were being produced daily over the same week of last the same time, our refineries' production of distillate fuels (diesel fuel and heat oil) rose by 322,000 barrels per day to 5,394,000 barrels per day, after our distillates output had decreased by 156,000 barrels per day over the prior week...but even after this week's increase in distillates output, our distillates' production for the week was still 0.9% below the 5,444,000 barrels of distillates per day that were being produced during the week ending December 21st, 2018....

with the increase in our gasoline production, our supply of gasoline in storage at the end of the week increased for the seventh week in a row and for the 13th time in 27 weeks, rising by 1,963,000 barrels to 239,260,000 barrels during the week to December 20th, after our gasoline supplies had increased by 2,529,000 barrels over the prior week....our gasoline supplies increased by less this week because our exports of gasoline rose by 280,000 barrels per day to 870,000 barrels per day while our imports of gasoline rose by 75,000 barrels per day to 594,000 barrels per day and while the amount of gasoline supplied to US markets decreased by 108,000 barrels per day to 9,303,000 barrels per day....after this week's increase, our gasoline supplies were 2.6% higher than last December 21st's inventory level of 233,106,000 barrels, while they remained roughly 5% above the five year average of our gasoline supplies for this time of the year...

even with the increase in our distillates production, our supplies of distillate fuels decreased for the 10th time in 13 weeks and for 25th time in the past 38 weeks, but only by 152,000 barrels to 124,944,000 barrels during the week ending December 20th, after our distillates supplies had increased by 1,509,000 barrels over the prior week....our distillates supplies decreased this week because the amount of distillates supplied to US markets, an indicator of our domestic demand, rose by 96,000 barrels per day to 4,214,000 barrels per day, and because our exports of distillates rose by 535,000 barrels per day to 1,450,000 barrels per day, while our imports of distillates rose by 70,000 barrels per day to 248,000 barrels per day....after this week's inventory decrease, our distillate supplies were 4.2% higher than the 119,902,000 barrels of distillates that we had stored on December 21st, 2018, while ​they ​slipp​ed to 8% below the five year average of distillates stocks for this time of the year...

finally, with this week's big increase in refining, our commercial supplies of crude oil in storage fell for the fifteenth time in twenty-eight weeks and for the twentieth time in 48 weeks, decreasing by 5,474,000 barrels, from 446,833,000 barrels on December 13th to 441,359,000 barrels on December 20th...but even after that decrease, our crude oil inventories were still 2% above the five-year average of crude oil supplies for this time of year, and were roughly 32% higher than the prior 5 year (2009 - 2013) average of crude oil stocks after two weeks of December, with the disparity between those comparisons arising because it wasn't until early 2015 that our oil inventories first rose above 400 million barrels...even though our crude oil inventories had generally been rising over this past year, except for during this summer, after generally falling until then through most of the prior year and a half, our oil supplies as of December 20th were fractionally below the 441,411,000 barrels of oil we had stored on December 21st of 2018, while remaining 1.1% above the 436,491,000 barrels of oil that we had in storage on December 22nd of 2017, but at the same time were 9.1% below the 485,449,000 barrels of oil we had in commercial storage on December 23rd of 2016...       

This Week's Rig Count

the US rig count decreased for the 16th time in the past 19 weeks over the week ending December 27th, and is now 25.7% below the count as of December 28th of last year....Baker Hughes reported that the total count of rotary rigs running in the US decreased by 8 rigs to 805 rigs this past week, which was also down by 278 rigs from the 1083 rigs that were in use as of the December 28th report of 2018, and 1,124 fewer rigs than the shale era high of 1,929 drilling rigs that were deployed on November 21st of 2014, the week before OPEC began their attempt to flood the global oil market...

the number of rigs drilling for oil decreased by 8 rigs to 656 oil rigs this week, which was also 208 fewer oil rigs than were running a year ago, and much less than the recent high of 1609 rigs that were drilling for oil on October 10th, 2014...​.​at the same time, the number of drilling rigs targeting natural gas bearing formations was unchanged at 125 natural gas rigs, matching last week's 3 year low for natural gas drilling, down by 73 gas rigs from the 198 natural gas rigs that were drilling a year ago, and way down from the modern era high of 1,606 rigs targeting natural gas that were deployed on September 7th, addition to those rigs drilling for oil & gas, three rigs classified as 'miscellaneous' continued to drill this week; one on the big island of Hawaii, one in Washoe County, Nevada, and one in Lake County, California, in contrast to a year ago, when there were no such "miscellaneous" rigs deployed..

offshore drilling activity in the Gulf of Mexico decreased by one rig to 23 rigs this week, as one of the rigs that had been drilling offshore from Louisiana was shut down this a result, the 22 rigs that continued drilling in Louisiana waters plus the one that was drilling offshore from Texas was down by one from the Gulf of Mexico rig count of 24 rigs a year ago, when 23 rigs were drilling offshore from Louisiana waters and one rig was drilling in Texas waters...since there are no rigs deployed off US shores elsewhere, nor were there a year ago, the Gulf of Mexico count for this year and last is equal to the national total in both cases..

the count of active horizontal drilling rigs was down by 3 rigs to 703 horizontal rigs this week, which was 242 fewer horizontal rigs than the 945 horizontal rigs that were in use in the US on December 21st of last year, and also well down from the record of 1372 horizontal rigs that were deployed on November 21st of addition, the vertical rig count was down by 7 rigs to 49 vertical rigs this week, and those were also down by 19 from the 68 vertical rigs that were operating during the ​last full week of last year....on the other hand, the directional rig count was was up by 2 to 53 directional rigs this week, but those were still down by 17 from the 70 directional rigs that were in use on December 28th of 2018...

the details on this week's changes in drilling activity by state and by major shale basin are shown in our screenshot below of that part of the rig count summary pdf from Baker Hughes that gives us those changes...the first table below shows weekly and year over year rig count changes for the major oil & gas producing states, and the table below that shows the weekly and year over year rig count changes for the major US geological oil and gas both tables, the first column shows the active rig count as of December 27th, the second column shows the change in the number of working rigs between last week's count (December 20th) and this week's (December 27th) count, the third column shows last week's December 20th active rig count, the 4th column shows the change between the number of rigs running on Friday and the number running before the same weekend of a year ago, and the 5th column shows the number of rigs that were drilling at the end of that reporting week a year ago, which in this week’s case was the 28th of December, 2018...   

December 27 2019 rig count summary

much of this week's drilling decrease virtually reverses the increases we saw last week, which certainly must be coincidental, since no one would be starting rigs one week just to shut them down the next...for rigs drilling in the Texas Permian, which saw a 13 rig increase last week, a net of seven rigs were shut down in Texas Oil District 8, or the core Permian Delaware, two more rigs were pulled out of Texas Oil District 8A, or from the northern Permian Midland, and another rig was pulled out of Texas Oil District 7C, or the southern part of the Permian addition, another 2 rigs were pulled out of Texas Oil District 7B, which is usually thought of as east of the main Permian, but which had at least three Permian basin rig additions last week....since the net decrease in the Permian was just nine rigs, and since the two rigs added in New Mexico were likely Permian rigs, we can figure that at least one of the rigs in those 4 Texas ​'Permian' ​districts was not targeting the Permian, but without digging thru the North America Rotary Rig Count Pivot Table (xls) for the individual well records, we can't say for sure which, at least on the basis of the summaries we're provided with...we're also left somewhat in the dark about what changes happened in Oklahoma, which saw a net one rig increase despite the two rig decrease in the Cana Woodford, hence meaning that three rigs began operating in the state outside of the 5 Oklahoma basins tracked​ & summarized​ here by Baker Hughes...the week's natural gas rigs changes, however, are pretty straight forward; one natural gas rig was shut down in the Haynesville, in Texas Oil District 6, just across the border from the core Haynesville shale in northern Louisiana, while a natural gas rig began operating in Pennsylvania's Marcellus at the same time...we should also note that another rig was shut down in Mississippi this week, leaving the state with 3 rigs operating, down from the 6 rigs that were operating in Mississippi a year ago, although as we've noted, the rig count in Mississippi has been quite volatile, ranging from 1 rig to 6 rigs and back again over the past year... 


Utica Shale well activity as of Dec. 21 -

  • DRILLED: 136 (145 as of last week)
  • DRILLING: 152 (158)
  • PERMITTED: 482 (480)
  • PRODUCING: 2,422 (2,422)
  • TOTAL: 3,192 (3,205)

Two horizontal permits were issued during the week that ended Dec. 21, and 13 rigs were operating in the Utica Shale.

Tax dollars from two pipelines could fall short — Developers of two new natural gas pipelines in Ohio want to reduce their valuation, which would decrease by millions the anticipated tax dollars coming to schools and communities. Owners of the Rover and NEXUS pipeline systems filed separate requests with the Ohio Department of Taxation earlier this month to have the values of their pipelines lowered by 30 percent to 50 percent in many places, The Blade reported. The values sought by the companies vary from county to county and will ultimately be determined by the state. Valuations are what auditors use as a basis for calculating property taxes. Specifics of the appeals are confidential, and the process could take months to decide, department spokesman Gary Gudmundson said. Schools and communities counting on the tax windfall say they’re in a tough spot — at least one community expected to use pipeline property taxes to make up 50 percent of its tax base and the fluctuation could impact the building schedule for a new school in another. The pipeline developers are within their rights to seek lower property taxes annually, but the process makes it especially difficult for school districts, which depend the most on such windfalls, to plan ahead, said Mike Kovack, former president of the County Auditors’ Association of Ohio. “I would like to see the Department of Taxation protecting the local tax base and not siding with an out-of-state company poised to make billions,” Matthew Oestreich, Wood County auditor, told The Blade in reference to the Nexus pipeline that runs through his county. Two companies, Enbridge and Detroit’s DTE Energy, partnered to spend $2 billion to build the 255-mile-long pipeline that stretches across northern Ohio and into Michigan. The $4.3 billion Rover Pipeline consists of twin 42-inch high-pressure lines that span about 700 miles miles from northern West Virginia into Michigan. The Rover pipeline became fully operational this past year, meaning stakeholders were planning on particularly strong property tax revenue from it.

Firefighters drill on oil, gas fire response - New Philadelphia Times Reporter - Municipal and rural firefighters in western Stark County train to extinguish blazes that occur when oil and gas wells catch fire. Response to an oil well fire can also be different than working to extinguish a typical house or building blaze, Lawrence Township firefighter Jared Lee explained. “Usually, we’re gung-ho on throwing water on a fire,” said Lee. “With these well (fires), you have to use other (techniques and means).” Fuel fires are often fought using biodegradable foam, but other times they’re extinguished using water and dry chemicals, or a fog, according to Pat Rhodes, assistant Massillon fire chief, who said multiple city firefighters have gone through oil and gas field training over the last decade. At one time, the city believed energy wells would be installed in bulk locally, Rhodes said. But most ended up being constructed closer to oil companies that operate outside of the region. Oil and gas well fires are typically sparked from lightning striking a well or a grass fire encroaching on an oil field. Fuel tends to make the fire hotter and more hazardous. Techniques such as learning how to shut down leaking wells and utilizing foam to “snuff out” the oxygen of a fire are part of the training, Rhodes said.  Township Fire Chief Mark Stewart said he has sent approximately two-dozen firefighters to the program over the last eight-to-10 years, roughly two-to-four firefighters per year.  “It’s a confidence builder,” the chief said of the training. “These (real) incidents can be loud (with a hissing noise) or intimidating if you’ve never done it.” During multiple days of OOGEEP training, firefighters engage in classroom instruction, virtual-reality exercises and live outdoor simulations, Stewart said.

Banks take a fresh look at fracking, and they don't like what they see - Crain's Cleveland Business - Fracking is falling out of favor with some lenders. The Wall Street Journal reports some of the banks that helped fuel the boom in hydraulic fracturing "are beginning to question the industry's fundamentals, as many shale wells produce less than companies forecast."From the article:Banks have begun to tighten requirements on revolving lines of credit, an essential lifeline for smaller companies, as these institutions revise estimates on the value of some shale reserves held as collateral for loans to producers, according to people familiar with the matter.Some large financial institutions, including Capital One Financial Corp. and JPMorgan Chase & Co., are likely to decrease the size of current and future loans to shale companies linked to reserves as a result of their semiannual reviews of the loans, the people say. The banks are concerned that if some companies go bankrupt, their assets won't cover the loans. ...The heat is greatest for small and midsize shale producers, including many whose wells aren't producing as much oil and gas as they had projected to lenders and investors.It's not just big lenders who are concerned.The Journal says "some regional banks have begun writing off bad energy loans" and notes that net charge-offs "shot up at Huntington Bancshares in the last quarter."Columbus-based Huntington "attributed the move primarily to two energy loans where the borrowers' production had not met expectations," according to CEO Stephen Steinour.  "Geology and the assumptions were just flawed," Steinour tells The Journal. The paper adds that energy companies "accounted for more than 90% of defaults on corporate debt in the third quarter, according to Moody's Investors Service. There were more than 30 oil-company bankruptcies in 2019, exceeding the number in 2018 and 2017. Exploration and production companies are now carrying more than $100 billion in debt."

U.S. Chamber concerned fracking ban could hurt economy - Canton Repository - The U.S. Chamber of Commerce is concerned that efforts to stop fracking will hurt Ohio’s economy. Some of the Democratic Party’s presidential candidates have said they want to end fracking, and that has the Global Energy Institute of the U.S. Chamber of Commerce hustling to show that a ban would be a bad idea. Fracking — formally known as hydraulic fracturing — is a process that has been used in oil and gas drilling for more than 50 years. Fracking has been used on a large scale to drill in the Utica Shale and similar formations around the country. Activists groups for years have called for a fracking ban, and some presidential candidates have promised to pursue a ban. A study by the U.S. Chamber contends a ban would deliver a staggering blow to the economy. In Ohio, a ban on fracking could eliminate 700,000 jobs between 2021 and 2025, the study contends. Meanwhile, the state’s gross domestic product would drop by $245 billion during the same period. The cost of living would rise, while household incomes would drop, according to the study. Finally, $20.6 billion would disappear from state and local tax revenue. Marty Durbin, president of the U.S. Chamber’s Global Energy Institute, said shale drilling driven by fracking has fueled the country’s sustained period of growth over the past decade. “Our study shows that banning fracking would have a catastrophic effect on our economy, inducing the equivalent of a major recession and raising the cost of living for everyone across the country. This bad idea should be abandoned,” Durbin said in a statement.

What Are Nurdles, And Why Are They Threatening The Ohio River? -  When the petrochemical plant being built by Shell Chemical Appalachia in Beaver County is complete, it's anticipated to bring 600 jobs as well as spinoff industries. But some researchers and activists warn that it could also bring a new type of pollution to the Ohio River Valley — nurdles. Nurdles are tiny plastic pellets similar in size to a lentil and produced at petrochemical plants. They're the raw material of the plastics industry, the building blocks of everything from car parts to keyboards to grocery store bags. Jace Tunnell is the reserve director at the Marine Science Instituteat the University of Texas at Austin. Before last year, he had only heard of nurdles. But walking along the beach at Corpus Christi, Texas, in 2018, he saw nurdles littering the high tide line."And at first, I wasn't sure, you know, are they fish eggs?" Tunnell said. "When I picked one up and squeezed it, it was really hard. I knew exactly what that was. It was a nurdle."Tunnell described it as unbelievable how many opaque pellets he saw on the beach. There were thousands, likely more. "I was kind of in shock," he said. Tunnell sought to better understand nurdle pollution: How many of these were really washing up on the Texas Gulf Coast? So, he started surveying the beaches. He also created Nurdle Patrol, a citizen science project that teaches people how to find nurdles and document their presence.  Boy Scout troops, families and others have done surveys along the Gulf Coast. One thing Tunnell has learned from this: "Almost every single beach that you go to has pellets on it," he said.  "These pellets don't break down over time," he said, adding that it can take hundreds of years for nurdles to break into smaller pieces.  When birds, fish and other species eat bits of plastic, it can make them think they're full and die of malnutrition. Microplastics, including nurdles, are also known to attract toxins that can accumulate in wildlife.  One study found some fish sold for human consumption in the United States contained plastic debris. The World Health Organization says more research is needed on the health impacts to humans.

Natural gas production headed for a slow-down in 2020 - The region’s Marcellus and Utica shale gas producers had a banner year in 2019.  Pennsylvania, Ohio and West Virginia together accounted for one-third of the nation’s natural gas production. But a likely slow-down is ahead in 2020.Marcellus and Utica shale drillers produced 30 billion cubic feet of gas in 2019. The increased supply has driven down prices to about $2 per million British thermal units. Compare that to the previous decade, when gas was selling at about $8 per million Btu.Penn State geologist Terry Engelder first reported on the abundance of shale gas in 2008.“These companies made their investments, anticipating six- to eight- to 10-dollar gas,” Engelder said. “No one ever dreamed it would stabilize at two-dollar gas. There’s just so much of it, particularly here in Pennsylvania, that the companies can’t sell it.”IHS Markit senior director for natural gas Charles Nevle says it’s not an indication natural gas production is going away, but it does mean production will be flat in 2020.“We can’t grow production in 2020,” Nevle said. “So we’re going from this really rapid growth period in 2019 to a year that will have to keep production essentially flat.”Major gas producer Chevron recently announced it is pulling out of the Marcellus and Utica shale plays.In parts of the country, gas production is so high, companies are burning it offrather than selling it.Nevle says producers in shale formations that also include oil, like the Permian Basin in Texas, have seen negative prices for natural gas. And that has also driven down prices nationwide.“So that makes it a very challenging environment when you are dependent on natural gas prices,” he said. Nevle says demand will also wane in 2020, and storage will be a challenge. You can burn it or put it back in the ground. If there’s no more room for storage, you just have to cut production. “That means less rigs operating, less wells being drilled, lower activity,” he said.

Natural gas developers banking on report to prevent Pa. fracking ban - Natural gas developers in Pennsylvania are hoping a recent water quality report by the Susquehanna River Basin Commission could squelch plans for a fracking ban that’s currently being considered by the neighboring Delaware River Basin Commission. The SRBC’s Remote Water Quality Monitoring Network report, which was released last month, revealed that water quality scores at 14 of the 16 stations in the basin were in the “good” or “excellent” categories  According to a fact sheet from the Susquehanna commission, the monitoring stations are located in areas where active drilling takes place, as well as areas free of development, in order to determine what, if any, impact drilling for natural gas has on the basin’s water quality.  River basin commissions are multistate government agencies that include both state-level and federal representatives to set policies regarding water resource management. The SRBC includes New York, Pennsylvania and Maryland, and the Pennsylvania area covered includes such cities as Scranton, Williamsport, Altoona, Harrisburg, York and Lancaster. The DRBC covers the Pennsylvania region bordering on New Jersey. It also includes representatives from New Jersey, New York and Delaware. The SRBC report comes as members of the DRBC consider a ban on fracking, or the practice of using high-pressure injections into the ground to collect natural gas deposits underneath. Kate Schmidt, a DRBC spokeswoman, said the commission is still reviewing public comments that were gathered early last year. There is no time frame to make a decision, she said, and any decision made would have to be done in an open meeting with a given notice.  In May, Gov. Tom Wolf said he supported the ban, as have governors in New Jersey and Delaware. That means there are enough votes to support the measure, according to Maria Michalos, a spokeswoman for the Natural Resources Defense Council. Now, she said, the goal is to get the Delaware commission to schedule a vote. “The Delaware River Basin provides drinking water for over 17 million Americans,” Ms. Michalos said. “A full ban would protect people’s health from toxic wastewater and preserve the region’s freshwater supplies, so industry cannot drain them to frack in other parts of the country.”

Pro-fracking movie gets $22K in two days on Kickstarter - Los Angeles Times -- In what may be interpreted as a backlash against the Oscar-nominated environmentalist film “Gasland,” a new production titled “FrackNation” has received an eye-popping $22,000 in donations during its first two days on the crowdfunding site Kickstarter.“Gasland"is a searing critique of the oil and gas drilling practice known as hydraulic fracturing, or fracking, which has come under intense scrutiny by environmental groups and the EPA. “FrackNation” co-creator Phelim McAleer says that his new film seeks to give voice to those longtime residents in gas-drilling areas who support fracking.Previous films by McAleer and the film’s co-creator Ann McElhinney, including “Mine Your Own Business,” critique the environmentalist community for getting in the way of industry and jobs for working people. It is not clear if any of the 252 Kickstarter donations come from gas and oil interests directly. This film, McAleer says, started when he went to see a presentation by Joshua Fox, the director of “Gasland.” “I live in Marina del Rey, California. I have no interest in gas. I’m a journalist and I went to a Q&A by Josh Fox, and asked him some difficult questions and got some interesting answers,” McAleer says. The two of them began a discussion of the footage in the film in which homeowners ignite the natural gas that comes out of their taps. “He knew that people could light their water for decades before fracking started. He said he didn’t include that in the film because it wasn’t relevant.”

U.S. gas drillers saw record gains in 2018, EIA reports - U.S. natural gas production had its biggest one-year increase on record in 2018, the U.S. Energy Information Administration reported Thursday.Driven by now more than decade-old advancements in hydraulic fracturing technology, production increased by 10 billion cubic feet per day last year - an 11 percent increase from 2017 - to 101.3 billion cubic feet per day. That led to a more 50 percent gain in gas exports, through LNG tankers and pipelines.  "In September 2018, the United States exported more natural gas by pipeline than it imported by pipeline for the first time in at least 20 years," the EIA report read.The biggest gains came in Texas, where gas production grew to 24.1 billion cubic feet per day, just behind the Appalachian region's production of 28.5 billion cubic feet per day.

Natgas Futures Plunge Into Bear Market On Warmer Weather Outlook - Last week we described how "A cold shot of air" was going to blast Boston, New York, Philadelphia, and Washington, D.C., through the weekend, then lead to unseasonably warm temperatures through Jan. 02. Much of the cold weather has already exited the Northeast on Monday, resulting in a plunge in Natgas futures on warmer weather outlooks.  Front-month gas futures on the New York Mercantile Exchange were down .10 cents, or -4.21%, at $2.231 per million British thermal units (mmBtu) at 12:30 am est.  Natgas futures stumbling into a bear market. "(As) the weather last week was colder than normal we would expect a larger than usual storage draw. However, somewhat normal to above normal weather for this week and the holidays would mean reduced demand significantly," Zhen Zhu, an economist at Oklahoma City-based C.H. Guernsey, told Reuters. The Global Forecast System (GFS) shows from Washington, D.C., to New York to Boston, above-trend temperatures will be seen from Dec. 23 through Jan. 01.  The Northeast heating degree day (HDD) index dips this week and won't rise above trend until Jan. 02/03. This means that energy demand to heat a structure will decline due to warmer temperatures - more reasons why Natgas futures will remain on a decline through this week, or until weather forecasts show cooler weather is on the way. The Lower-48 HDD also shows energy demand across the U.S. to heat a structure will be on the decline for the next ten or so days.  Traders told Refinitiv that Natgas prices have plunged since early November "due to milder than usual weather and expectations inventories will still rise over the five-year average in the coming weeks. Near-record production enables utilities to leave more gas in storage, wiping away lingering concerns of supply shortages and price spikes during the winter."

U.S. natgas futures down nearly 5% on warmer weather forecasts - U.S. natural gas futures fell nearly 5% on Monday on expectations of warmer weather, which would lead to a reduction in heating demand.Front-month gas futures for January delivery on the New York Mercantile Exchange were down 11.4 cents, or 4.9% to settle at $2.214 per million British thermal units (mmBtu), their bigger daily percentage fall in over three weeks. “(As) the weather last week was colder than normal we would expect a larger-than-usual storage draw. However, somewhat normal to above normal weather for this week and the holidays would mean reduced demand significantly,” said Zhen Zhu, economist at Oklahoma City-based C.H. Guernsey. Prices are likely to stay flat or go even lower if the weather is not much colder than normal in the next several weeks, he added. Data provider Refinitiv estimated warmer-than-normal temperatures in the Lower 48 U.S. states over the next two weeks. It projected 385 heating degree days (HDDs) in the time period, lower than the 394 HDDs estimated on Friday, which is indicative of warming weather. Last week had 197 HDDs versus a 30-year normal of 189 HDDs, Refinitiv data showed. Refinitiv predicted demand in the Lower 48 states, including exports, would fall from an average of 126.9 billion cubic feet per day (bcfd) last week to 113.6 bcfd this week.

US natural gas futures rise to two months peak - US natural gas futures surged to a near two-month peak on Thursday as weather forecasts turned cooler, which could boost heating demand, and on short-covering as the contract nears its expiry. A day before the contract expires, front-month gas futures for January delivery on the New York Mercantile Exchange rose 12.2 cents, or 5.6%, to settle at $2.294 per million British thermal units (mmBtu). This is their largest daily percentage gain since October 29. Data provider Refinitiv estimated 411 heating degree days (HDDs) in the Lower 48 US states over the next two weeks, higher than the 372 HDDs estimated on Tuesday- indicative of cooling weather. The weather, however, is still warmer than normal. “Natural gas is higher this morning on weather forecast patterns for middle January," said Robert DiDona of Energy Ventures Analysis, adding that the cold trend is causing some short covering. Thin trade during the holiday week is leading to more volatility, he said. With the weather expected to turn chillier, Refinitiv predicted demand in the Lower 48 states, including exports, would average 113.9 billion cubic feet per day (bcfd) next week, increasing from the 112.3 bcfd estimated for the current week. Analysts said utilities likely pulled 148 billion cubic feet (bcf) of gas from storage during the week ended Dec. 20. That compares with a withdrawal of 61 bcf for the same week last year, and a five-year average draw of 101 bcf. If correct, the decrease during the week ended Dec. 20 would reduce stockpiles to 3.263 trillion cubic feet (tcf), about 1.7% below the five-year average and 19.4% above the same week a year ago. Gas production in the Lower 48 states dipped to 95.1 bcfd on Wednesday from 95.2 bcfd on Tuesday, according to Refinitiv.

US working natural gas in underground storage decreases by 161 Bcf: EIA | S&P Global Platts --US working gas volumes in storage plummeted by 161 Bcf last week due to colder weather and tighter supply, but the balance-of-winter strip tanked further during Friday trading as much smaller draws are expected for the next two weeks. Not registered? Receive daily email alerts, subscriber notes & personalize your experience. Register Now Storage inventories fell by 161 Bcf to 3.250 Tcf for the week ended December 20, the US Energy Information Administration reported Friday morning. The pull was more than an expected draw of 153 Bcf, based on a survey of analysts by S&P Global Platts. Responses ranged from a draw of 145 Bcf to 165 Bcf. The withdrawal was much stronger than the 61 Bcf pull reported during the corresponding week in 2018, as well as the five-year average draw of 101 Bcf, according to EIA data. As a result, stocks were 518 Bcf, or 19%, more than the year-ago level of 2.732 Tcf and 69 Bcf, or 2.1%, less than the five-year average of 3.319 Tcf. The draw was also stronger than the 107 Bcf pulled from working gas in storage reported for the week ended December 13. Still, the NYMEX Henry Hub balance-of-winter strip, January through March, fell by 7.3 cents to $2.18/MMBtu following the weekly storage report, which was released on Friday instead of Thursday due to the Christmas holiday. This is lowest the winter strip has been during this part of the heating season since winter 2015-16. A forecast by S&P Global Platts Analytics' supply and demand model showed much lighter storage pulls for the rest of the month. Combined withdrawals for the weeks ending December 27 and January 3 are expected to total 142 Bcf, with 75 Bcf draw forecast for the week in progress. Lower demand due to the Christmas and New Year's holidays over the course of the two weeks will play a role in the smaller draws. For example, the Midwest region is sending out more gas this week due to lower Christmas week demand. Demand in the Midwest averaged just 14.3 Bcf/d for the week ending December 27, the lowest level for the week of Christmas since 2015 and 6 Bcf/d lower than the previous week, according to Platts Analytics. Net inflows to the Midwest this week remained strong at 13 Bcf/d. Lower demand combined with high inflows have caused both lower storage withdrawals and higher volumes pushed out to the Southeastern US. Storage withdrawals have dropped 4.1 Bcf/d from last week to 1 Bcf/d. Christmas Day saw the lowest daily withdrawal this December at only 391 MMcf pulled from Midwest storage fields. The excess available gas subsequently flipped flows between the Midwest and Southeast. As a result, Chicago basis to Henry Hub decreased to an average of minus 13 cents/MMBtu this week, down from minus 11 cents last week. Withdrawals in the region should increase as Chicago basis once again rises.

Natural Gas Price Fundamental Daily Forecast - EIA Reports Bigger-Than-Expected Storage Draw -Natural gas prices are attempting to comeback following a steep sell-off earlier in the session. The catalyst behind the selling pressure are demand losses in the latest guidance. Both the Global Forecast System (GFS) and European weather models lost demand overnight, particularly the “milder trending” European dataset, according to NatGasWeather.Helping to stabilize prices are technically oversold prices and a bigger-than-expected weekly storage draw according to the U.S. government.At 15:37 GMT, February natural gas is trading $2.223, down $0.061 or -2.58%. This is up from an earlier low of $2.167. The EIA reported Friday that domestic supplies of natural gas fell by 161 billion cubic feet for the week-ending December 20. Analysts were looking for a drop of 150 to 153 bcf. Total stocks now stand at 3.250 trillion cubic feet, up 518 bcf from a year ago. The five-year average stands at 3.319 bcf, down 69 bcf, according to the government report. “Weather trends were quite bearish overnight in the European model,” the forecaster said. “The GFS also lost demand but was still rather chilly January 6-8. But after the GFS has performed so poorly, we mentioned colder patterns were only to be believed if the European model was also on board, and now it isn’t.” Technically, traders continue to straddle the short-term 50% to 61.8% retracement zone at $2.237 to $2.259. This zone is controlling the near-term direction of the market. Look for an upside bias to develop on a sustained move over $2.259, and for the downtrend to continue on a sustained move under $2.237.

New England Natural Gas Prices Hit Two Year High - With at least six days last year averaging colder than today’s forecast, it seemed almost impossible that gas prices would break last season’s record. Accompanying this week’s cold was a combination of factors amounting to conditions that were far from normal. As the risks began to present themselves on the morning of Wednesday, December 18, AGT-CG (Non-G), New England’s largest natural gas hub, sold for as much as $15.25/MMBtu, the highest price observed since January 30, 2018. So, what really caused natural gas prices to spike when they were so weak for the last six months?  Major changes in New England over the last two years have resulted in greaternatural gas demand for power production. New England is known for its pipeline constraints, and the retirement of the 680 MW Pilgrim nuclear generating has almost entirely been met with increases in natural gas-fired generation; almost 3 GW. On top of this, one of Algonquin’s largest suppliers, Tetco M3, is operating at reduced capacity following thorough investigations into the pipeline quality. As a result, Tetco M3, Iroquois Z2, Algonquin, and TGP Z6 were operated at near full capacity, and all saw operational flow orders in place for today’s (December 19) market. These operational flow orders imposed an additional set of rules on natural gas transactions, increasing competition and basis separation. Additionally, the price strength on Algonquin occurred even though the Atlantic Bridge project is partially implemented, allowing an additional 50 million cubic feet per day of throughput capacity compared to last year. One major difference between the coldest days last winter and this Wednesday-Friday (December 18-20), is the presence of liquefied natural gas (LNG) in the market. New England relies heavily on LNG, which is often imported from overseas. When temperatures average below 20°F in New England, residential and commercial heating load will exceed total import capacity on the pipeline network, so LNG is required to support any amount of gas-fired generation in the supply stack outside of Southwest Connecticut. The largest receipt point for LNG in New England is called the Northeast Gateway, which is an off-shore floating buoy that can transport as much as 800 million cubic feet of natural gas per day from LNG tankers to the largest demand centers. In December, temperatures took a dive before Excelerate could get a tanker to it.

We May Have An Explanation For Burning Oil To Generate Electricity -- Even If Not Needed -- December 26, 2019 - Burning Oil In The US To Generate Electricity To Max Out Pollution Credits By The End Of The Year.  ISO New England has more than enough energy the past two days (including today) so as not to have to use oil. Earlier I asked why ISO New England might be burning oil under these circumstances. A reader who corresponds with me closely regarding ISO New England and understands it very, very well, had this to say after I posed the question:  I have also been curious as to why oil is being burned as per the ISO. While I am certain the source/reason can be found, I, my self, do not know, but suspect it is coming from the oil burning Wyman plant in Yarmouth, Maine. The restrictions on emissions might be prompting an 'end of the year' burning of onsite fuel so as to 'use up' all the permitted pollutants before December 31, 2019. Don't know, but the steady ~355 Megawatts produced from oil for several mid-morning hours indicates a controlled, purposeful operation.  The reader's response came in reply to my note below, posted earlier today:  Plenty of energy today, not sure why they're burning oil to generate electricity:

Forest Service Withdraws Logging Project in West Virginia’s Monongahela National Forest to Spare Endangered Fish ― The U.S. Forest Service this week announced it will withdraw a 2,400-acre logging project in West Virginia’s Monongahela National Forest following objections raised by conservation groups about harm to an endangered fish. The Center for Biological Diversity and Friends of Blackwater submitted formal objections in July. The groups said the Big Rock Timber Project would threaten the endangered candy darter and the area’s waters. “We appreciate the Forest Service’s decision to withdraw this misguided project,” said Jason Totoiu, a senior attorney at the Center. “Building new logging roads and clearcutting trees on extremely steep slopes would have been disastrous for wildlife, including the beautiful candy darter.” The project would likely have caused significant erosion and sent sediment into rivers and streams, threatening the rare fish and other animals. “Friends of Blackwater and all of our supporters are very pleased that the Monongahela National Forest supervisor has withdrawn the Big Rock Timber Project proposal,” said Judy Rodd, director of Friends of Blackwater. “Hopefully this is a step toward fully protecting the candy darter, a tiny jewel of a fish found in the timbering proposal area, near the world-famous Cranberry Glades.” The Forest Service announcement said the project would have been the first of its kind to require formal consultation under the Endangered Species Act for the brightly colored candy darter, which was listed as endangered in November 2018. The Fish and Wildlife Service would have had to calculate how many, if any, candy darters could be killed or harmed by the proposed project. The Fish and Wildlife Service also plans to include portions of the logging project area in its final designation of the fish’s critical habitat. Those issues contributed to the decision to pull the project.

How Oil Companies Avoided Environmental Accountability After 10.8 Million Gallons Spilled -In the aftermath of Hurricane Katrina in August 2005, while stranded New Orleanians flagged down helicopters from rooftops and hospitals desperately triaged patients, crude oil silently gushed from damaged drilling rigs and storage tanks. Given the human misery set into motion by Katrina, the harm these spills caused to the environment drew little attention. But it was substantial. Nine days after the storm, oil could still be seen leaking from toppled storage tanks, broken pipelines and sunken boats between New Orleans and the Mississippi River’s mouth. And then Hurricane Rita hit. Oil let loose by Katrina was pushed farther inland by Rita three weeks later, and debris from the first storm caused damage to oil tankers rocked by the second. All told, the federal agency overseeing oil and gas operations in the Gulf of Mexico reported that more than 400 pipelines and 100 drilling platforms were damaged. The U.S. Coast Guard, the first responder for oil spills, received 540 separate reports of spills into Louisiana waters. Officials estimated that, taken together, those leaks released the same amount of oil that the highly publicized 1989 Exxon Valdez disaster spilled into Alaska’s Prince William Sound — about 10.8 million gallons. The Oil Pollution Act, passed by Congress in response to the Valdez incident, requires that federal and state agencies work with the companies that spilled the oil to conduct a preliminary assessment of damage to natural resources. Once a comprehensive report is finalized on the value of the affected plants, soil, water and wildlife, those so-called responsible parties must pay for restoration efforts. Fourteen years later, not one assessment of the damage to natural resources after the two 2005 hurricanes has been completed. None of the 140 parties thought to be responsible for the spills has been fined or cited for environmental violations. And no restoration plans have been developed for the impacted ecosystems, fish, birds or water quality, a review by The Times-Picayune and The Advocate and ProPublica has found. The extent of the damage to the environment may never be known.

Louisiana LNG Unit Starts Production - The second liquefaction train at the Cameron LNG project in Hackberry, La., has begun producing liquefied natural gas (LNG), McDermott International, Inc. reported Monday. Joint venture partners McDermott and Chiyoda International Corp. are engineering, procurement and construction (EPC) contractors for Cameron LNG. In a written statement emailed to Rigzone, McDermott noted that Train 2 production – still in its initial phases – represents a precursor to substantial completion of Train 2. “This accomplishment is attributable to the entire team’s unwavering commitment to project delivery and steadfast focus on safety and quality performance as we work toward completion of Train 2,” commented Mark Coscio, McDermott’s senior vice president for North, Central and South America. “We are confident their hard work and focus will continue through the remainder of the project.” Cameron LNG ultimately will comprise three liquefaction trains with a projected LNG export capacity of 12 million tonnes per annum. Sempra LNG LLC, Total, Mitsui and Co. Ltd. and Japan LNG Investment, LLC (a Mitsubishi Corp.- Nippon Yusen Kabushiki Kaisha (NYK) joint venture) own the facility. As a Rigzone article from earlier this month notes, Train 1 at Cameron LNG began commercial operation on Aug. 19, 2019. In a separate announcement Monday, Sempra stated that Trains 2 and 3 should begin commercial operations under Cameron LNG’s tolling agreements in the first and third quarters, respectively, of 2020.

Manufacturing Group Opposes LNG Export Applications - A U.S. trade group representing manufacturers with $1 trillion in annual sales has gone on record against four liquefied natural gas (LNG) export applications submitted to the U.S. Department of Energy (DOE). “LNG export volumes decrease pipeline capacity that is available to U.S. consumers, because the natural gas is committed to going offshore to supply other countries, not U.S. consumers,” the Industrial Energy Consumers of American (IECA) argued in a written statement emailed Friday to Rigzone. Washington, D.C.-based IECA reported that it has submitted comments to DOE opposing four LNG export applications. The organization claims that DOE, which authorizes LNG exports, and the LNG project developers have failed to determine whether enough gas pipeline capacity exists to serve domestic consumers as well as LNG exports.  Firms submitting LNG export applications, and links to each application’s DOE docket index and IECA’s respective notices to DOE, are as follows:

IECA noted the applications increase approved LNG export volume by 3.5 Bcf per day. The Cheniere Marketing/Corpus Christi project is on the Texas Gulf Coast. The remaining projects are in southwestern Louisiana. “By the end of 2019, LNG exports will have reduced available pipeline capacity nearly 10 Bcf per day,” stated IECA, adding the above applications raise LNG export volumes by 3.5 Bcf per day. “At the same time, placed in service interstate natural gas pipelines have slowed. New pipeline capacity faces growing headwinds.”

As LNG booms, some fear bubble- For years, LNG developers have sold investors on multi-billion dollar export projects based on the premise of the world’s insatiable appetite for natural gas.  But three years after Cheniere Energy made history by exporting the first shipment of liquefied natural gas from the continental United States, energy insiders are debating whether an LNG bubble is developing around the vast sweep of projects scheduled to come online over the next 10 years. From Russia to Qatar, Mozambique to Canada, the oil and gas industry has enough projects in the works to almost double global LNG production by 2030, with much of that growth focused along the Texas and Louisiana Gulf Coast. As analysts crunch the numbers, some do not believe the demand is there to support them all.   “My take is some people are wildly optimistic about demand. We found this wide range of forecasts, some of them physically impossible.”Forecasts of LNG’s meteoric rise largely hinge on expectations of rising demand in China, India and developing nations in Southeast Asia, all of which have limited domestic supplies of natural gas. But governments there have been slow to shift from cheap coal — which they have in abundance — to undertake the vast pipeline, storage and terminal buildouts necessary to shift their economies toward gas. Already,there are signs that Asia’s appetite for LNG might not be as reliable as developers would hope. Global LNG imports this summer were up 11 percent from last year, but almost two thirds of that additional gas went into storage in Europe and not Asian markets,  That has resulted in storage tanks in Germany and the Netherlands at near capacity - typically they would be at 80 percent at this point in the year - pushing prices there to around $3.30 per million British thermal units, or MMBTUs, well below the point at which it its profitable to import U.S. LNG. At the same time Russia is building new pipelines into Europe and is looking to expand its LNG facility near the Arctic Circle. “All this surge into LNG into Europe is not because Europe wants or needs LNG. It’s because it has nowhere else to go,”   “The problem is if we get this perfect storm of events, like a mild winter, Russia keeps pumping out pipeline gas and China’s growth is a bit weak. In that scenario, you have LNG pushing a supply gap that no longer exists and then prices crash.”

Magellan seek to boost capacity of refined products pipeline to El Paso - Tulsa-based pipeline operator Magellan Midstream Partners is seeking to boost capacity along a pipeline that moves gasoline to destinations in West Texas, New Mexico, Arizona and south of the border in Mexico. In a Friday morning statement, Magellan announced that it has launched a second open season to book more capacity along the western leg of the company's refined products pipeline known as the South System. The pipeline currently moves 100,000 barrels of gasoline per day but as part of the a project announced in 2018, that capacity will be expanded to 175,000 barrels per day. Under the company's second open season, that capacity could be increased up to 200,000 barrels per day, which translates to roughly 8.4 million gallons of gasoline per day. Midstream Moves: Whistler Pipeline moves forward with three public meetings Magellan is building a new refined products storage terminal in Midland to support the pipeline expansion. The refined products pipeline expansion and Midland terminal are expected to be operational in mid-2020. The pipeline will allow more gasoline to move from Houston-area refineries to Abilene and then to El Paso where the system connects with other pipelines to destinations in New Mexico, Arizona and south of the border in Mexico.

Texas energy sector pulls back as shale producers cut spending, jobs - The contraction of the oil and gas industry in and around Texas continued in the fourth quarter as shale producers cut back on spending and jobs, the latest survey from the Federal Reserve Bank of Dallas showed. The bank’s business activity index was -4.2 for the final three months of the year, compared with -7.4 in the third quarter, according to its report published Friday. The survey covers the 11th Federal Reserve District, which includes not just Texas but energy-rich parts of Louisiana and New Mexico. The bank’s indexes for capital spending, employment and employee hours were also negative for the fourth quarter. The data showed oilfield service companies bearing the brunt of the slowdown, while exploration and production companies reported a small uptick in business activity. Overall, the survey will likely reinforce the existing gloom surrounding oil and gas, with shale producers struggling -- and largely failing -- to achieve consistent free cash flow and investor returns in the face of stagnant oil prices and a plunge in the price of natural gas. The index is calculated by subtracting the percentage of respondents reporting a decrease from the percentage reporting an increase. When the share of firms reporting an increase exceeds the share reporting a decrease, the index is greater than zero. Next year may bring little respite. On average, respondents in the survey said they expect the price of West Texas Intermediate crude to be $58.54 a barrel by the end of 2020. The benchmark traded Friday at around $61.80. The expectation for Henry Hub gas is $2.51 per million British thermal units, about 20-30 cents above where it currently trades. The controversial practice of gas flaring also featured in the latest survey. A lack of pipeline capacity was the main reason for flaring most frequently identified by respondents. As usual, the Dallas Fed’s quarterly report includes unattributed comments from respondents, which provide color in addition to the survey data:

A Problem In The Permian - As drilling slows down, Permian wells are becoming gassier. “The oil ratio is no longer sufficient to offset gas in older wells, so we’re seeing some increase in basin-wide” gas-to-oil ratios,” said Artem Abramov, head of shale research at Rystad Energy.

  • - In the Permian, the average well produces 2,000 cubic feet of gas for every barrel of oil. Gas is much less lucrative than oil. Later on in the lifetime of that well, the gas-to-oil ratio can climb to 5,000 cubic feet.
  • - The ratio grows worse when wells are drilled too close together. But the ratio is also higher in the Delaware sub-basin of the Permian, where recent drilling has been concentrated.
  • - The higher-than-expected gas-to-oil ratio has undercut the finances of some drillers, while also contributing to the region’s worsening flaring problem.
  • - The amount of equity issued in 2019 from the shale industry fell to its lowest level in 13 years.
  • - The value of shares issued in 2019 fell to $1.3 billion, the lowest level since 2006. In 2016, the industry issued $34 billion in shares.
  • - Debt issuance was flat at $44.5 billion in 2019, still at elevated levels compared to earlier this decade.
  • - Coal consumption in China seemingly hit a peak back in 2013, showing slight declines in the years since then.
  • - However, China has made a strategic pivot back to coal, worried about rising oil and gas import dependence. China’s import dependence for oil reached 72 percent last year, the highest in 50 years.
  • - Coal consumption ticked up in 2018, and the increases are expected to continue in 2019 and 2020.
  • - Analysts say the trend has also been influenced by the U.S.-China trade war, and the U.S.’ abandonment of climate goals.
  • 4. Nord Stream 2 nearing completion
  • - Last-minute U.S. sanctions could delay the completion of the Nord Stream 2 pipeline, but the project is expected to reach the finish line.
  • - The 55-bcm/y pipeline will allow Russia to increase gas flows into Europe. Goldman Sachs remained cautious, predicting mostly flat gas shipments from Russia to Europe next year, but noted that Nord Stream 2 presented “upside risk” to that forecast
  • - “With no significant changes so far to our NW European gas flow expectations for 2020, we maintain our view that the market is going to remain over supplied and that, as a result, TTF prices will be pressured below $4/mmBtu to incentivize Norway to cut exports to the region,” Goldman said. TTF prices are an important hub price in northwest Europe.

Permian Banks Latest Drag on Texas Economy-- The slowdown in Permian Basin oil drilling and fracking is spreading to the lenders as austerity takes hold. The 63 banks and savings associations in the world’s biggest shale field have taken a wild swing from 2018 when they led Texas in loan growth, according to the Federal Reserve Bank of Dallas. In the third quarter, the outstanding value of loans from banks in West Texas grew 4.8% compared to a year earlier. That lagged the 7.5% loan growth for the Lone Star State as a whole. The greatest disparity was for loans made on apartments and other multifamily development: a 15% drop in the Permian region compared with a 12% surge statewide. With investors pressing oil explorers to focus on fattening buybacks and dividends, the number of frack crews busy in the Permian is at the lowest level in more than two years. The area has been hemorrhaging jobs this year in stark contrast to 2018’s breakneck expansion.

US oil, gas rigs drop 20 to 840 during the last full week of 2019: Enverus — The US oil and natural gas rig count dropped by 20 to 840 during the last week of 2019, according to rig data provider Enverus. The entire decrease came from rigs chasing crude oil. These numbered 673 as of December 25 - down by 22 from the previous week. In contrast, 162 rigs were hunting for gas, up two on the week. The total rig count also reached a recent low of 840 during the first week in December 2019. With that exception, this week's rig count is the lowest since early February 2017. Year-end slowdowns are usual between mid-November and late December or even the first days in January. The current rig count has fallen 3.5% from 870 in mid-November, although it bounced around within that range. "Just a short week and some missed reports, happens every year," Enverus director of content Bob Williams said. "If it doesn't bounce back by a comparable amount next week [or the week after], I'll be surprised." On Friday, the Dallas Federal Reserve found in its latest quarterly survey that US oil and gas executives expect WTI prices to average $58.54/b by the end of 2020. But most of the 170 US oil and gas and oilfield service executives polled also plan to base capital spending on 2020 prices trading roughly 8% lower throughout next year. The Permian Basin registered the biggest week-on-week change in rigs - down by nine to 395. The West Texas/New Mexico play is the largest domestic crude producer with an estimated 4.69 million b/d of oil and just shy of 17 Bcf/d of gas. And, the US Energy Information Administration projected those figures could rise by 48,000 b/d of oil and 213,000 Mcf/d of gas in January. In contrast, the Eagle Ford Shale gained four rigs to 81. The South Texas play is one of the US' largest and most popular drilling areas, with 1.3 million b/d of oil production and 6.8 Bcf/d of gas output. But EIA predicts output could slip by about 9,000 b/d and 69,000 Mcf/d next month. In addition, the Denver-Julesburg Basin, a smaller Colorado play, lost five rigs on the week, leaving 18. But the Williston Basin of North Dakota and Montana gained three rigs, for a total 53. The Williston currently produces 1.5 million b/d, although little change is expected in January - one of the area's coldest months. Three plays posted no week-on-week rig change: the Haynesville Shale, a gas play found in East Texas and Northwest Louisiana, stayed at 47; the SCOOP-STACK in Oklahoma remained at 41 and the Utica Shale found mostly in Ohio, was steady at 12. Also, the largely Pennsylvania-sited Marcellus Shale gained two rigs to 39. Specifically, the Dry Marcellus and Wet Marcellus each gained one rig, for respective totals of 19 and 20 rigs.

Is the US Shale Boom Really About to End?  | Rigzone - If current crude flow data forms the basis of industry opinion, US shale oil production has shifted the tectonic plates of the market. Thanks largely to a massive output uptick in shale plays like the Bakken, Permian and Eagle Ford, the country has more than doubled headline crude production over the past decade. At around 12.5 million barrels per day (bpd), the US is already the largest producer in the world and some forecasters are predicting a rise to 13.1 million bpd by 2020. Rising volumes have also given shale players the title of being buffer producers, largely insulating the market from price spikes caused by outages elsewhere. For some, a continuation of the boom is not in doubt. According to the US Energy Information Administration (EIA), production from seven major American shale plays is forecast to climb by 49,000 bpd in December to 9.133 million bpd. At its heart is the Permian Basin, in West Texas and Southeast New Mexico, where the EIA expects the biggest month-over-month increase of up to 57,000 bpd. Looking at the long-term, an unlikely source appears to have given US shale its backing – none other than rival producers’ group OPEC, which expects a flood of shale barrels and less of a call on its members’ crude. "The main driver of medium-term non-OPEC supply growth remains overwhelmingly US tight [shale] oil," OPEC recently noted in its markets outlook. By 2025, OPEC expects US oil production, courtesy shale, to have risen by over 40% from its current level to 17 million bpd; an upward revision of 3.1 million bpd over the group’s forecast last year. While some are optimistic, others are only too keen to puncture the enthusiasm. The latter club surprisingly includes shale pioneers themselves and not just market forecasters. In a recent analysts’ call, Pioneer Natural Resources Chief Executive Officer Scott Sheffield said shale output growth will slow next year thereby creating a price supportive environment. He added that Pioneer was definitely becoming “more optimistic” the market is “probably at the bottom end of the cycle regarding oil prices” as a result. Industry pioneer Mark Papa, Chief Executive Officer of Centennial Resource Development and former Chairman of EOG Resources, is another doubter. At Centennial’s third-quarter results in November, Papa downgraded his 2020 shale growth forecast to 400,000 bpd from the 700,000 bpd he predicted as recently as September.

Some Colorado residents want their local governments to ban fracking. Here’s why that probably won’t happen. -  In April, Gov. Jared Polis signed into law Senate Bill 181, which gives local governments authority to write oil and gas regulations that are “more protective or stricter than state requirements,” so long as the regulations are “reasonable” and “necessary” to protect public health, safety, welfare, the environment and wildlife resources.  Senate Bill 181 does not state whether an outright ban is legal — the law doesn’t even mention the word “ban.” The question of whether the law allows for it will almost certainly have to be decided by the courts.   If any county were to try banning fracking under the new law, it would be Boulder. The county passed its first drilling moratorium in 2012 followed by five years of extensions — even after a Colorado Supreme Court ruling in 2016 effectively struck down local bans. The county commissioners have called on state regulators to protect public health and safety, backed a ballot measure to increase setbacks and joined several lawsuits against the industry. Advocates at the Unity of Boulder Church were circulating petitions calling on the commission to ban drilling. So far, the three commissioners have been mostly mum on whether they support the idea. The Colorado Independent emailed the three and received a response from a county spokesperson who said, “we cannot comment on this question because it involves areas where the County Attorney will be providing privileged legal advice to the Board of County Commissioners. In order for the board to keep open any legal option for addressing oil and gas drilling, they need to make certain they do not prejudice future decisions by speaking publicly on any matters that may be challenged legally.”

Broomfield asks the state to limit Extraction's oil well fracking, and the company pushes back - Extraction Oil & Gas Inc. is restarting fracking at a controversial Broomfield well site amid the city’s attempt to limit work there, alleging the operation has violated noise limits.Broomfield noise monitors had picked up sound in excess of limits 1,000 feet from the Denver-based company’s Livingston site multiple times between Nov. 30 and Dec. 14, the city said. Extraction has its own noise monitors near the Livingston well site at Broomfield’s northern edge and says it finds no violations of the 55-decibel daytime or 50-decibel nighttime standards established in the operator agreement it reached with Broomfield in 2018.“We’ve looked at our data, and all of our data shows that we are within compliance of our operator’s agreement and well below what the state requires,” said Brian Cain, Extraction spokesman.The company challenged whether the city’s noise-monitoring contractor maintains and calibrates its equipment correctly. But, in response to the complaints from a nearby neighborhood, Extraction has added 250 hay bales and a second layer of sound wall to shield residential areas south of the fracking operation. It also removed an onsite generator used for some equipment to dampen noise from the site, Cain said.Broomfield has asked the Colorado Oil and Gas Conservation Commission to limit Extraction’s well-completion work at the Livingston well site to 6 a.m. to 10 p.m., according to a Dec. 20 letter that Jennifer Hoffman, Broomfield city and county manager, sent to COGCC Director Jeff Robbins. “Extraction has made some attempt to reduce the noise to acceptable levels in the community. However, the noise continues and is adversely impacting many residents,” she wrote, noting the drilling operation is of "industrial size" but in a residential environment. “The totality of impact is taking its toll on the overall health, safety and welfare of our residents.” Last spring, Colorado increased local government control of surface impacts of oil and gas operations, reforms known as Senate Bill 181. Disputes like the one between Broomfield and Extraction will test how much state regulators can referee disputes of local standards established in operator agreements. The Broomfield and Extraction operator's agreement, though controversial among many residents, was seen as setting a new standard for impacts mitigation in Colorado when it was reached in 2018. Limiting hours of operations would be unprecedented and could mean extending the amount of time the company is working at the well site by several weeks, Cain said.“It’s in the operator agreement that our industry runs 24 hours a day and seven days a week,” he said.

US judge rejects bid to kill Keystone pipeline lawsuits (AP) — Environmentalists and Native Americans can proceed with lawsuits challenging President Donald Trump’s approval of the Keystone XL oil pipeline from Canada, a federal judge in Montana ruled Friday. U.S. District Judge Brian Morris expressed skepticism over government arguments that Trump has unilateral authority to approve the $8 billion pipeline. In a separate ruling, the judge said the Rosebud Sioux and Fort Belknap Indian tribes had valid claims that approval of the line violated their treaty rights. But Morris denied a request from environmentalists to impose a court injunction blocking preliminary work on the pipeline, since no such work is planned until spring 2020. Morris had blocked work on the line in 2018, prompting Trump to issue a new permit in March in an attempt to circumvent the courts. The 1,200-mile pipeline would transport up to 830,000 barrels of crude daily from western Canada to terminals on the Gulf Coast. Opponents worry burning the tar sands oil that will be carried by the line will make climate change worse, and that it could break and spill into water bodies such as Montana’s Missouri River. TC Energy of Canada first proposed the project more than a decade ago but has been unable to get past the numerous lawsuits against it. Trump has been a strong supporter and revived Keystone XL after it was rejected under President Barack Obama.

Carbon dioxide pipeline slated for southwest North Dakota -- North Dakota could soon have a second carbon dioxide pipeline. The Public Service Commission is considering permitting a pipeline that would run through Slope and Bowman counties to old oil fields along the Montana-North Dakota border. The line would carry a supply of carbon dioxide that Denbury Resources plans to inject underground to squeeze out more oil in a process known as “enhanced oil recovery.”One other carbon dioxide pipeline exists in the state. Authorized by the PSC in 1998, it carries gas from Basin Electric’s Great Plains Synfuels Plant near Beulah to oil fields in Saskatchewan, Canada. Denbury aims to build its pipeline in 2020 and begin injecting carbon dioxide in early 2021.Commission Chairman Brian Kroshus during a Wednesday, Dec. 18, meeting called the project “a very promising proposition.”“It helps to repressurize the reservoir and breathes new life into wells that have been depleted,” he said. “And it helps reduce emissions at the same time.”The PSC scheduled a hearing on the pipeline for Feb. 6 at the Bowman Lodge and Convention Center in Bowman.Denbury is targeting oil fields within the Cedar Creek Anticline Area that straddles the state border. Only a small portion of the oil stored in the rock that makes up such fields can be extracted initially once a well is drilled.A company can later perform what’s known as “secondary recovery” by injecting water to flood the field and push more oil out of the rock. Denbury has been using such technology in the Cedar Creek Anticline Area, said John Mayer, director of investor relations for the company.  Finally, a field can undergo “tertiary recovery” in which a substance such as carbon dioxide is injected. That’s what Denbury seeks to do in the years ahead in several phases across the Cedar Creek Anticline Area.The carbon dioxide would come from Exxon Mobil’s Shute Creek Gas Plant and Conoco Phillips’ Lost Cabin Gas Plant in Wyoming, according to Denbury’s application filed with the PSC. It would travel via several pipelines to Fallon County in southeastern Montana. From there, some of the carbon dioxide would cross into North Dakota via the segment of line that's under consideration by the PSC.The North Dakota portion of the 18-mile, two-state line would span nine miles and cost $9.2 million, according to the application. The Denbury project is one of several enhanced oil recovery efforts in the works in North Dakota.

Montana more aware of minimizing oil spills - Montana has experienced 461 oil and gas spills since 2015, according to a new factsheet by Environment Montana Research & Policy Center These accidents have released a total of 6 million gallons of wastewater and 298,000 gallons of oil onto Montana land and waterways.“The research is clear: when you drill, you spill,” said Skye Borden, state director at Environment Montana Research & Policy Center. “Our state’s oil and gas development comes with very real costs to our waterways, our wildlife, and our health.” The majority of the spills were in eastern Montana, in an area known as the Williston Basin. But spills were recorded throughout the state, including at sites 50 miles from Yellowstone National Park and 45 miles from Glacier National Park. At least 29 of the spills occurred on federally-owned public land.Toxic substances in oil and gas wastewater have been linked to a variety of negative health effects on humans and fish. Chemical components in fracking fluids, for example, have been linked to cancer, endocrine disruption and neurological and immune system problems .Spills have also been responsible for large-scale fish die offs .“Despite the threat spills pose to wildlands and wildlife, the Interior continues to approve drilling permits in some of our wildest, most ecologically-sensitive areas,” said Borden. “And every new permit creates new dangers for our public lands and the people who enjoy them.”The Interior is currently considering a drilling permit in the Tendoy Mountains in Montana’s High Divide . This region is one of America’s largest intact ecosystems; it provides important habitat for grizzly bears, wolverines, cutthroat trout, and many of Montana’s big game species. The project’s environment assessment notes that potential spills could impact surrounding rivers’ water quality . “Given their track record, I don’t think it’s possible for the oil and gas industry to operate responsibly – especially in our wildest places,” said Borden. “Drilling in Montana simply isn’t worth the risk.”

Natural gas industry’s $1 million PR campaign sets up fight over Northwest’s energy future - Washington and Oregon natural-gas companies, rattled by local proposals that could shift more buildings to electricity, will spend $1 million on a public-relations campaign to promote their fuel as part of the region’s clean-energy future.The gas companies are forming a coalition of unions, businesses and consumer groups to tout the benefits of natural gas and to help “prevent or defeat” initiatives that inhibit its use, according to internal industry documents obtained by The Seattle Times. They’re calling the coalition “Partners for Energy Progress,” and a public launch is scheduled next year.The planning documents provide a window into the industry’s broader effort to ensure that natural gas continues to be piped into American homes and other buildings, even as municipal and state governments grapple with how to combat climate change.“This will play out on a national scale much sooner than a lot of us have expected,” said Seattle City Councilmember Mike O’Brien, who in September proposed banning gas from new construction. “I think it’s the right time for us to be having this debate.”In Seattle, Bellingham and other Northwest cities, gas companies and their allies already have begun fighting policy proposals, like O’Brien’s, that would place new restrictions on natural gas use in buildings as a way to reduce climate emissions. Puget Sound Energy (PSE) joined other opponents to halt the Seattle proposal, and Cascade Natural Gas has attacked recommendations by a Bellingham task force that include phasing gas out of all buildings.

2019 Was the Year That Fracking Fell Apart - Despite a raft of accounting gimmicks, the industry wasn’t able to hide the fact that it was drowning in red ink. By mid-year, Sightline’s Clark Williams-Derry reported that:A cross-section of 29 fracking-focused oil and gas companies reported more than $2.5 billion in negative free cash flows in the first quarter of 2019. These results were even worse than in the fourth quarter of 2018…And as the year went on, the frackers’ problems kept getting worse. By December, the oil and gas giant Chevron was forced to write down its assets by more than $10 billion, with industry analysts widely accepting that dozens of other companies in the sector would face a similar reckoning. Whatever financial pain the industry is facing, though, looks like a flesh wound compared to the injury it has inflicted on the rest of us—and our environment. As Chevron tried to put on a brave face for investors, researchers at Stanford University dispelled the characterization of natural gas as a necessary “bridge fuel” to clean energy. Quite the opposite: A surge in natural gas has helped drive down coal burning across the United States and Europe, but it isn’t displacing other fossil fuels on a global scale. Instead, booming gas use is fueling the global growth in greenhouse gas emissions, according to a new study by researchers at Stanford University and other institutions.In fact, natural gas use is growing so fast, its carbon dioxide emissions over the past six years actually eclipsed the decline in emissions from the falling use of coal, the researchers found. Consider also the grim news that came in December, when the National Academy of Sciences reported that a new satellite-based methane analysis determined that a single gas well blowout in Ohio last year was one of the largest methane leaks in US history. TheNew York Times reported:The blowout, in February 2018 at a natural gas well run by an Exxon Mobil subsidiary in Belmont County, Ohio, released more methane than the entire oil and gas industries of many nations do in a year, the research team found. The Ohio episode triggered about 100 residents within a one-mile radius to evacuate their homes while workers scrambled to plug the well.”The Ohio blowout released more methane than the reported emissions of the oil and gas industries of countries like Norway and France, the researchers estimated. Scientists said the measurements from the Ohio site could mean that other large leaks are going undetected. When you sign up for fracking—”shale gas development,” as the industry likes to have it—that’s what you should expect. Not often, but not never.

2020: The Year Of The Oil Bankruptcies | - A bankruptcy boom has hit the oil and gas industry, and it’s just getting started. Investors have lost their appetite for shale, and energy debt has become among the least desirable in the market.  The industry has been teetering on the verge of mass hysteria for much of 2019 as a record number of energy companies folded.   According to Energy and Restructuring law firm Hayes and Boone’s, a grand total of 50 energy companies filed for bankruptcy during the first nine months of the year, including 33 oil and gas producers, 15 oilfield services companies and two midstream companies.  In contrast, 43 oil and gas companies filed for bankruptcy for the whole of 2018.   The biggest oil and gas bankruptcy of the year--indeed, the biggest since 2016--was EP Energy, which filed for bankruptcy in October, unable to pay back some $5 billion in debt.   During the latest shale boom, the putative class valedictorian of the modern energy industry, American drillers binged on mountains of readily available debt as they capitalized on investors and financiers willing to gamble on the premise that fracking operations could be significantly cheaper and more efficient than conventional drillers.  Before long, oil markets were flooded with a deluge of the commodity far outstripping demand. In what few could have foreseen, the US became the world’s largest oil producer, with its nearly 13 million b/d output turning it from a net importer to a net exporter of crude. Predictably, prices tanked by a sizable margin, dropping to levels well below the breakeven points of many drillers. Suddenly, investors became wary of the shale industry and energy debt became anathema. They have good reason to be scared.  Companies with junk-rated bonds have been defaulting on interest payments at record levels, while dozens of smaller drillers that had saddled themselves with too much debt have been dropping like flies. Now analysts see this taking an even sharper turn, with more mergers and more debt restructurings required to get the industry back in shape.

As Fracking Companies Face Bankruptcy, U.S. Regulators Enable Firms to Duck Cleanup Costs - In over their heads with debt, U.S. shale oil and gas firms are now moving from a boom in fracking to aboom in bankruptcies. This trend of failing finances has the potential for the U.S. public, both at the state and federal levels, to be left on the hook for paying to properly shut down and clean up even more drilling sites.Expect these companies to try reducing their debt through the process of bankruptcy and, like the coal industry, attempting to get out of environmental and employee-related financial obligations.  In October, EP Energy — one of the largest oil producers in the Eagle Ford Shale region in Texas — filed for bankruptcy because the firm couldn't pay back almost $5 billion in debt, making it the largest oil and gas bankruptcy since 2016.EP Energy hasn't produced a profit since 2014 and Bloomberg reported that the company would need oil to be at "a price closer to $70 per barrel" for EP to be profitable. Oil has not come close to averaging over $70 a barrel since 2014.Despite its financial struggles at current low oil prices, the company plans to continue operating after restructuring and eliminating up to $3 billion in debt. However, EP has not identified any funds that it would be setting aside for well cleanup, which is not unusual for an oil and gas company.In response, as part of the bankruptcy proceedings, the U.S. Department of the Interior filed a documentarguing that EP Energy is still responsible for its obligations to assure the "decommissioning, plugging, and abandonment" of any of the EP Energy wells that are located on leased federal and tribal lands.Ideally, that would mean EP Energy sets aside funds for the proper cleanup and end-of-life processes for its oil and gas wells, which number more than 800 in the Eagle Ford region.However, the federal government hasn't even named a number yet for how much that should be. The Bureau of Land  Management and Bureau of Indian Affairs "are currently still assessing the status of reclamation and plugging and abandonment obligations across the Debtors' onshore federal and Indian leases," writes the Interior Department. The federal government is only getting around to assessing EP Energy's potential liabilities once the firm is already in the bankruptcy process, revealing one of the flaws in the current system. Federal and state governments have not been holding fracking companies fully liable for the environmental damage and cleanup costs of their drilling activity.

Oil sector may be entering final decade of growth -- f the decade coming to a close will be remembered for a shale drilling revolution that transformed the United States into the world’s biggest oil producer, the oncoming 2020s may well go down in history as the decade when the world’s demand for crude peaked for good.As concerns about climate change mount, electric vehicles are projected to gain ever-larger shares of auto markets, while the fuel efficiency of internal combustion is only expected to improve — all cutting into the demand for transportation fuels, oil’s primary product.Virtually everyone agrees peak oil demand is coming. OPEC predicts demand will rise into the 2040s, but the European energy major Royal Dutch Shell and others say global oil demand could peak before 2030. So what will this mean to oil-centric Houston, the reigning energy capital of the world?“We’re entering a decade that could be the beginning of the end in some ways,” said Jennifer Rowland, an energy analyst with Edward Jones. “You can paint a pretty bearish picture that oil demand is going to plateau before 2030.”Sour outlook on oilThe debate over peak demand highlights the remarkable shift that global energy markets have made in less than 20 years. As recently as 2008, analysts and investors argued over the timing of a phenomenon known as peak oil — when the world would begin to exhaust its reserves of crude.Now, concerns are mounting in the oil and gas industry that peak demand is not only coming, but coming faster than anticipated, all as the shale boom begins to slow, companies slash jobs and Wall Street turns its back on the energy sector after years of generating lackluster returns.

Investors Buy Into LNG Canada Supply Pipe -- KKR and Alberta Investment Management are set to acquire a 65% stake in the 670-km Coastal GasLink pipeline from TC Energy. US investment firm KKR has teamed up with Canadian fund manager Alberta Investment Management to take a 65% stake in a pipeline project to supply the Shell-led LNG Canada export plant with gas.

Docs Reveal Police Were Ready to Shoot Indigenous Pipeline Protesters in Canada -- Canadian police discussed shooting indigenous protesters who were trying to stop a natural gas pipeline from being built on their land, documents reported by The Guardian Friday revealed. On Jan. 7, Royal Canadian Mounted Police (RCMP) armed with assault rifles arrested 14 land defenders when they cleared a checkpoint set up by the Wet'suwet'en nation to stop construction of the Coastal GasLink (CGL) pipeline on their unceded territory in northern British Columbia (B.C.). Now, the documents obtained by The Guardian show that, in a strategy session before the raid to clear the road, RCMP argued that "lethal overwatch is req'd," meaning they wanted to use snipers.  RCMP higher-ups also told their officers to "use as much violence toward the gate as you want." Police were ready to arrest both children and grandparents, and one document mentioned the possibility of sending children to social services. Historically, the RCMP forcibly removed indigenous children from their homes to place them in residential schools. "Here we are, nearly 2020 and we are still being threatened with violence, death, and the removal of our children for simply existing on our lands and following our laws," Sleydo', or Molly Wickham, a spokesperson for the Gidimt'en Checkpoint protesters who was arrested herself in January, said in a statement reported byThe Georgia Straight. Coastal GasLink is owned by TC Energy, the company formerly known as TransCanada Pipelines, which is also the driving force behind the Keystone XL pipeline opposed by indigenous groups in both the U.S. and Canada. CGL is set to run 670 kilometers (approximately 416 miles) from northeastern B.C. to a liquid natural gas facility in Kitimat that is yet to be constructed.The company gained permission from elected First Nation councils along the pipeline route, but the hereditary Wet'suwet'en leaders oppose pipeline construction on their land. Since the Wet'suwet'en never surrendered their territories to the Canadian government, they argue that their hereditary leaders should have final say."This project aims to blaze a trail, in what has been envisioned as an energy corridor through some of the only pristine areas left in this entire region," a Wet'suwet'en media statement explained. "If CGL were to be built and become operational, it would irreversibly transform the ecology and character of Northern B.C. This is why the Wet'suwet'en Hereditary Chiefs have all unanimously opposed the construction of ALL pipelines through their territory."

Docs Show Canadian Mounties Deployed Snipers Against Indigenous Pipeline Protesters - In an exclusive report Friday that outraged human rights advocates worldwide, The Guardian revealed that Canadian police wanted snipers on standby for a January 2019 crackdown on Indigenous land defenders who were blocking construction of a natural gas pipeline through unceded Wet'suwet'en territory.  The Guardian reported on official records — documents as well as audio and video content — reviewed by the newspaper related to the police "invasion" that led to 14 arrests:Notes from a strategy session for a militarized raid on ancestral lands of the Wet'suwet'en nation show that commanders of Canada's national police force, the Royal Canadian Mounted Police (RCMP), argued that "lethal overwatch is req'd"—a term for deploying snipers. The RCMP commanders also instructed officers to "use as much violence toward the gate as you want" ahead of the operation to remove a roadblock which had been erected by Wet'suwet'en people to control access to their territories and stop construction of the proposed 670km (416-mile Coastal GasLink pipeline (CGL).Indigenous land defenders established the Gidimt'en checkpoint — where the police operation took place — as part of a broader battle against pipeline builder TC Energy, formerly known as TransCanada. The RCMP action was an attempt to enforce a court injunction that came in response to the Unist'ot'en camp established on Wet'suwet'en territory in opposition to the pipeline. Chilling euphemisms of 'sterlizing the site' and using 'lethal overwatch': police approaches to Indigenous protestors in Canada — Lucy Delap (@suff66) December 20, 2019 Guardian readers responded to the report with swift condemnation of the RCMP's behavior. "This is abhorrent and unconscionable," tweeted Steve Wilcox, a professor at Wilfrid Laurier University in Ontario, Canada. American author and journalist Michael Deibert summed up the revelations in one word: "Monstrous."

Suncor ordered to suspend Terra Nova operations offshore eastern Canada - The Canada-Newfoundland and Labrador Offshore Petroleum Board (C-NLOPB) has ordered Suncor Energy to suspend production-related operations on the Terra Nova floating production, storage, and offloading vessel (FPSO).The FPSO, which can store 960,000 bbl of oil, operates on the Terra Nova oil field about 350 km (217 mi) southeast of Newfoundland.The C-NLOPB’s chief safety officer (CSO) determined that Suncor is not compliant with regulatory requirements under Atlantic Accord Implementation Acts to maintain and comprehensively inspect equipment critical in the safe operation of the installation, to ensure repairs are carried out in a timely manner, and to ensure that mitigation measures are effective in minimizing hazards.Specifically, CSO found those requirements have not been met with respect to availability of redundant fire water pump systems.The suspension will continue until Suncor has addressed this matter to the satisfaction of the CSO. In May 2019, Suncor (37.675%) and the other Terra Nova joint venture owners (ExxonMobil, 19%; Equinor, 15%; Husky Energy, 13%; Murphy Oil, 10.475%; Mosbacher Operating, 3.85%; and Chevron Canada, 1%) sanctioned plans to proceed with a project that will extend the life of the FPSO, installed in 2002, to about 2031. The asset life extension project, scheduled to take place in 2020, is expected to allow for production of about 80 million bbl of additional oil. The life extension project will take place in 2020.

Equinor, Rosneft sanction Arctic field development - Equinor and Rosneft will jointly develop the first stage of North Komsomolskoye field. Total recoverable volumes for Stage 1 are estimated at 250 million bbl of oil and 23 billion cu m of natural gas. North Komsomolskoye was a part of a strategic cooperation agreement signed by Rosneft and Equinor in May 2012. Since 2018, the partnership has carried out test production in the field to better understand the reservoir properties and lay the ground for the full field development decision. North Komsomolskoye is a conventional onshore oil and gas field in Western Siberia, Russia. Equinor holds 33.33% and Rosneft 66.67% in the joint venture company, SevKomNeftegaz, that owns the North Komsomolskoye license.

Russia is dominating the Arctic, but it’s not looking to fight over it  - While the world focuses on trade wars and shifting geopolitical dynamics, Russia has been quietly expanding its own political, economic and military influence in a lesser-watched space: the Arctic. Russia certainly feels at home with the Arctic, and vice versa; Russia’s coastline accounts for 53% of Arctic Ocean coastline and the country’s population in the region totals roughly 2 million people — that’s around half of the people living in the Arctic worldwide, according to the Arctic Institute, a center for circumpolar security studies. As such, it’s perhaps no surprise that Russia wants to extend its influence in a region that it feels at home in, and one that offers multiple opportunities in a variety of areas ranging from energy and trade, to defense. “Russia is by virtue of its geography, the largest Arctic country. The fact that there are 2 million people that are Russian living there too means that the Arctic is Russia in many ways,” Andreas Østhagen, senior research fellow at the Fridtjof Nansen Institute in Norway, and at the Arctic Institute, told CNBC. “In Russia too, the Arctic resonates with people and they have so many of their resources in that region; oil and gas, fisheries and minerals.” It is estimated that there could be trillions of dollars’ worth (as much as $35 trillion) of untapped gas and oil reserves, as well as mineral resources, that Russia and its Arctic neighbors are keen to tap.

Global LNG Outlook 2020 --The US has gone from being an importer of LNG to being one of the largest exporters in a very short time, with plans to double its production again. There are currently nine LNG trains operating and producing LNG,2 plus Kinder Morgan’s Elba Island liquefaction project placed its first train in commercial service in October (although as of the time of writing no commissioning cargo has been loaded and shipped). All of these projects were designed to take advantage of the ‘great shale revolution’ in the US and the corresponding upheaval in the supply and demand dynamics of the domestic natural gas market. Consequently, the US has already become the fourth largest LNG supplier globally (behind Qatar, Australia and Malaysia) and, by adding 8.2 million t of LNG to global supply in 2018, it is second only to Australia as the largest driver of supply growth.3 Furthermore, as these ‘first wave’ projects emerge from the development and construction phase to become operational, the ‘second wave’ is becoming a reality with four more projects making firm progress. The emergence of US LNG exports has likely been the most significant development affecting the global LNG trade over the last few years. The de-coupling of LNG and crude oil with the introduction of Cheniere’s Henry Hub-based pricing formula, combined with the elimination of ‘destination clauses’ (removing restrictions on cargo destinations and allowing diversions) from US LNG sale and purchase agreements (SPAs) has contributed to accelerated growth and liberalisation of the global LNG trade, including in the spot market, which accounted for 31% of total global LNG trade in 2018. Alongside this significant growth in the physical trading and delivery of LNG on a spot basis, the industry is seeing an increase in the development and volume of financial trading of LNG, largely in the form of futures contracts. LNG futures contracts have been around for a few years, but meaningful penetration and growth in trading volumes emerged only in 2017/2018.4

Commodities 2020: Global LNG supply picture could start to get cloudy in 2020 — Depending on the person you talk to, the global LNG supply glut will either end or persist during the early part of next decade. A recent outlook from S&P Global Platts Analytics projected that the surge in new global LNG supply will finally come to an end by the middle of 2020, with capacity growth next year expected to be the slowest in five years. New supplies coming mainly from the US will still test the market's ability to consume it, and sufficient demand growth will largely depend on lower prices. "As long as we can be competitive out of the US as it relates to our feedstock, I would be surprised to see a massive disruption in the US industry," said Omar Khayum, CEO of Annova LNG, an Exelon-backed export project being developed in Brownsville, Texas. Platts Analytics expects that US LNG export volumes will rise from approximately 7.6 Bcf/d this month to 12.2 Bcf/d a year from now. That would be a build of 60%, versus the 65% increase over the last year. US export volume growth is expected to plunge to 10% in December 2021 compared with December 2020 and 5% in December 2022 compared with the previous December. Pressuring traditional market fundamentals will be the likelihood that final investment decisions on additional global production capacity could increasingly move ahead without being connected to long-term contracts with end-users. The LNG market will need to respond more broadly by incentivizing additional investment in LNG use and gas demand, Platts Analytics said in the outlook. In a recent report, Tudor Pickering Holt & Co. analysts described a spate of FID's by deep-pocketed backers as a "changing of the guard," reflecting the difficulty of securing long-term contracts, while indicating a growing spot market that further disincentivizes contracting. The energy investment bank expects contracts to become shorter and more flexible on volume, price and destination. "The size of the LNG spot market is growing, and the price of a spot LNG cargo is lowering," said Katie Bays, an energy analyst and co-founder of research and consulting firm Sandhill Strategy. "That's a typical example of an oversupply environment. And an oversupply environment is a tough environment for commercial commitments, which is what independent projects need." There are rising expectations that the market will continue to transition toward supply-push dynamics instead of demand-pull, shifting risk from the buyer to the seller. Loose market conditions spurred speculation in 2019 about potential curtailments of US LNG production at existing facilities.

Natural Gas Storage Market Poised to Expand at a Robust Pace by 2023 - Natural gas storage market is likely to register robust growth during 2015-2023. The total volume in the market clocked at 392,831.22 mcm in 2014. In 2023, this volume is likely to reach 548,798.39 mcm. Thanks to rising demand for energy, and growing appeal of natural gas due to low-cost alternative to fossil fuels, and low emissions, the natural gas storage market will register 3.7% CAGR during 2015-2023. The demand for natural gas storage is expected to remain highest in Europe. The region saw an increasing demand for natural gas storage facility, mainly due to rising demand from Italy, Germany, and France. Growing initiatives to meet varying seasonal demands, and applications such as heat and power generation are expected to drive growth in the region. Additionally, energy initiative such as district initiative are also aiding growth of the natural gas storage market. Rising drive to become energy independent, shale gas, and hydraulic fracturing technologies are also driving growth of the natural gas storage gas market in North America region. Depleted underground reservoir promise most opportunities for gas storage solutions in North America region. The reservoir promise low-cost production of natural gas. This has resulted in their robust growth conventionally, while making up 80% of total available natural gas. On the other hand, industry consumption is expected to remain a major opportunity in the market. Industries made up 30% demand for natural gas in 2015, while consumer related consumption made up for 33% in electric power generation. Fuel also remains a promising opportunity as duel flex engines and push for sustainable energy use will drive considerable growth in this segment. The fuel usage stood at meagre 8%.  Gas as feedstock also remained low with 10% total share. The rising opportunities in energy consumption due to portable energy generators, and rising demand for fossil fuel alternatives promise new opportunities for players in the natural gas storage market.

Wison Offshore & Marine begins construction of Arctic LNG 2 project -Wison Offshore & Marine (WOM) has announced that the fabrication of the Arctic LNG 2 project began in Zhoushan Yard on 29 November 2019.The module fabrication contract was awarded by Technip France S.A., a wholly-owned subsidiary of TechnipFMC. The project consists of three 6.6 million tpy LNG trains. According to the statement, WOM’s work scope is engineering, procurement, fabrication and commissioning of modules in train one with a total weight of 48 000 metric t. With continuous support from Novatek (the client of the project) and TechnipFMC, as well as by using detailed planning, WOM claims that it achieved the first cutting milestone ahead of schedule, which may ultimately lead to time and cost savings in the project execution.

Russia’s Lavrov says Nord Stream 2 will be launched despite sanctions: Ifax (Reuters) - Russian Foreign Minister Sergei Lavrov said on Sunday that the Nord Stream 2 and Turk Stream gas pipeline projects would be launched despite U.S. sanctions, adding that Russia planned to respond to the new measures, the Interfax news agency reported. U.S. President Donald Trump signed a bill on Friday that included legislation imposing sanctions on firms laying pipe for Nord Stream 2, which seeks to double gas capacity along the northern Nord Stream pipeline route to Germany.

Germany Expects Gas Pipeline Delay-- The Nord Stream 2 gas pipeline will be delayed and more costly due to U.S. sanctions but should be completed in the second half of next year, a senior German official said. Switzerland’s AllSeas Group SA removed vessels that were laying the last section of the pipeline connecting Russia with Germany, which was just weeks away from completion, after U.S. President Donald Trump approved sanctions targeting the project. Despite delays and higher costs, the pipeline should be completed in the second half of 2020, Peter Beyer, the German government’s coordinator for trans-Atlantic issues, said Monday in an interview with Deutschlandfunk radio. Less than 160 kilometers of the total 2,460 kilometers remain to be laid, according to Nord Stream 2 AG, the project operator. Trump’s decision was not a surprise but the sanctions are “completely incomprehensible” given the agreement between Russia and Ukraine on gas transit and “not a way to treat friends,” Beyer said. Germany “would have expected a great deal more understanding from the American friends,” added the lawmaker, a member of Chancellor Angela Merkel’s Christian Democratic Union party. Nord Stream 2 is set to ship as much as 55 billion cubic meters of Russian gas annually directly to Germany, doubling the capacity of the existing link. As many as 350 European companies are helping to build the pipeline, the German DIHK industry group estimates. Trump has criticized Germany for not doing more to diversify imports away from Russia, while Merkel’s government argues that the $11 billion link is crucial to ensure energy security. The firms involved will continue to work to complete the pipeline as soon as possible “in the interest of energy security, affordable gas prices for European consumers and EU economic competitiveness as well as climate protection commitments,” according to Monday’s Nord Stream 2 AG statement.

Nord Stream 2 pipelayer Allseas suspends operations on US sanctions — Switzerland-based Allseas -- which has been integral to laying the controversial Nord Stream 2 gas pipeline from Russia to Germany -- has suspended pipelaying activity after US President Donald Trump signed new sanctions into law late Friday, the company said Saturday. The move by Allseas will certainly mean new delays to the completion of the 55 Bcm/year pipeline, which had originally been scheduled to start operations at the end of 2019. "In anticipation of the enactment of the National Defense Authorization Act (NDAA), Allseas has suspended its Nord Stream 2 pipelay activities," the company said in a brief statement. "Allseas will proceed, consistent with the legislation's wind down provision and expect guidance comprising of the necessary regulatory, technical and environmental clarifications from the relevant US authority," it said. The new sanctions language against Nord Stream 2 is part of the NDAA, which had already been approved by the House of Representatives and the Senate. It calls for the US State and Treasury departments to submit a report within 60 days that identifies "vessels that engaged in pipe-laying at depths of 100 feet or more below sea level for the construction of the Nord Stream 2 pipeline project, the TurkStream pipeline project or any project that is a successor to either such project." Those ships and identified executives involved with those ships could then face sanctions. According to S&P Global Platts Analytics, Nord Stream 2 would have to seek alternative vessels and contractors to complete the remaining section of pipe in Danish waters if the sanctions are enacted. "While the most challenging parts of Nord Stream 2 have been laid in water depths of around 200 meters, the remaining section in Danish waters at 90 meters depth remains complicated," it said. Russian companies operate capable offshore pipe-lay vessels, which have completed projects in challenging Arctic conditions, including the MRTS Defender, which worked on the offshore stretch of the Bovanenkovo-Ukhta pipeline. Platts Analytics believes MRTS Fortuna could be used to complete Nord Stream 2, but is capable of laying just 1 km/d. A further obstacle, according to Platts Analytics, is that the Danish permit application states that it is assumed that the vessels used to complete the Danish section will have dynamic positioning capabilities (such as those of the Allseas vessels) which are not present on MRTS Fortuna. A Russian pipelaying vessel that already has dynamic positioning capabilities, Akademik Cherskiy, could be used, but it would take up to two months to arrive to Danish waters as it is currently stationed in Russia's Far East.

European Firms Stop Work On NS2 Pipeline As Gazprom Readies Own Ships 'Immune' To US Sanctions - Trump's signing the 2020 NDAA into law on Friday, and with it sanctions targeting European and Russian companies laying the Nord Stream 2 pipeline, had the immediate impact of forcing a work stoppage over the weekend as Allseas, the Swiss company that is Nord Stream’s main contractor, confirmed its workers as well as partner contractors have laid down their tools.  The new US punitive measures specifically target companies and their executives assembling the pipeline, including the very ships laying the pipeline on the controversial 760-mile project that would allow Russia to export natural gas directly to Germany and is expected to come online within the next year. Despite Allseas set to pull out its fleet of pipe-laying ships, Russia and Germany are vowing to move forward unimpeded, per the WSJ: Its ships Solitaire and Pioneering Spirit, the largest construction vessel in the world, will remain in the area but are no longer laying the pipes, a spokesman for Allseas said. He added that as of Thursday, when work ceased, the project was about one month from being completed. Jens D. Mueller, a spokesman for Nord Stream 2’s parent company, said that the pipeline would be finished despite Allseas pulling out its fleet. And Russia is now hitting back, first by promising Washington will not impede the project, and further with reports that Moscow is drawing up retaliatory sanctions against the US, while not citing specifics.  Majority stakehold Gazprom has indicated it's already taken measures to complete the project while circumventing the US measures. The WSJ continues: In preparation for the sanctions, Gazprom has retrofitted its own ships as well as ships belonging to Russian contractors that don’t do business outside Russia and would therefore be immune to American sanctions, according to one official of the company who spoke on the condition of anonymity. One contractor already involved in the project is the Russian subsea-pipeline construction firm MRTS JSC, a company that operates ships which could be used to complete the pipeline, according to Gazprom. A Russian Foreign Ministry statement described what it claims is in part an attempt by Washington to force its pricey liquefied gas on Europe: “As a result, Europeans will lose on all fronts.”  The statement added: “Washington decided that it shouldn’t spare anyone, even its closest allies in NATO, for the sake of its geopolitical ambitions and commercial profit.”

US Sanctions Backfire: Russia's Gazprom & Ukraine Make Landmark Deal  -  Sanctions-happy Washington continues to aid in a slow rapprochement between Russia and Ukraine. Ironically enough, at moment the US is demanding Nord Stream 2 contractors to lay down their tools and wind-down operations "immediately" or face further sanctions, there's been an unprecedented breakthrough in the standoff between Russian state energy giant Gazprom and Kiev:   As we detailed earlier this week, Allseas, the Swiss company that is Nord Stream 2's main contractor, confirmed its workers as well as partner contractors have laid down their tools; however, others have pressed forward as the project is very near completion, also as both Gazprom and the Nord Stream 2 project spokesman have promised to finish. Gazprom says it is now retrofitting its own ships to take over the bulk of pipeline laying that Allseas was overseeing. The WSJ reported previously that "Jens D. Mueller, a spokesman for Nord Stream 2’s parent company, said that the pipeline would be finished despite Allseas pulling out its fleet." Additionally, Russia's Energy Minister Alexander Novak vowed the 760-mile will be launched before the end of 2020 even after President Trump signed NS2 sanctions into effect last Friday, which target the companies laying the pipeline. Gazprom and five European companies are spearheading the project among them France's ENGIE, Austria's OMV, the UK-Dutch Royal Dutch Shell, and Germany's Uniper and Wintershall which includes dozens more smaller contractors. But now there's less incentive for European companies and Gazprom itself to heed Washington's warnings and stop work. As Reuters reports of Friday's major breakthrough:Russia’s Gazprom said on Friday it has paid Ukraine $2.9 billion to settle a legal row, part of a wider gas package deal reached last week.Last week, Russia and Ukraine announced the terms of a new gas transit deal, under which Moscow will supply Europe for at least another five years via its former Soviet neighbour and pay a $2.9 billion settlement to Kiev to end a legal dispute.

‘Complete greenwash’: Western Europe’s largest oilfield ramps up production — defying calls to stop  - A newly-discovered oilfield in the Norwegian part of the North Sea is on track to produce almost 0.5% of global oil supplies next year, despite calls for it to immediately stop producing crude altogether. Based approximately 87 miles off the West coast of Norway, the Johan Sverdrup oilfield represents the largest North Sea discovery in more than three decades. It only came on stream in early October, but it is already considered Western Europe’s biggest oil producer, supplying more than 300,000 barrels per day (b/d). Equinor, Norway’s state-controlled oil company and Sverdrup’s operator, has said it expects crude production from this field to increase to 440,000 b/d in the summer of next year — before eventually climbing up to 660,000 b/d after 2022. To put those figures into context, the International Energy Agency (IEA) reported earlier this month that global oil supplies stood at 101 million b/d in November. So, assuming total oil output worldwide is little changed over the coming months, the Sverdrup oilfield will soon account for 0.4% of global production. “It is quite significant,” Tamas Varga, senior analyst at PVM Oil Associates, told CNBC via telephone. The speed of its development has been “absolutely amazing,” he added, especially when you consider “the general perception was that the North Sea was declining as far as output is concerned.” The discovery of the Sverdrup field, and its rapidly rising oil output, comes as global leaders debate the best approach to combat an intensifying climate crisis.

Mysterious crude oil spill in Brazil affects coastal wildlife - An oil spill of unknown origin is reportedly harming Brazil's wildlife and beaches. For several months, blobs of crude oil have appeared on Brazil's coastline, Reuters reported, calling the spill the worst in the country's history. By Dec. 18, more than 950 beaches in 11 states had been affected. Brazilian authorities have made a list of oil tankers that they suspect could be behind the spill, but all of the companies they belong to have denied responsibility, according to the wire service. Reuters reported that 159 animals, including sea turtles, birds and marine mammals, have been affected and that 109 of them have died. The first oil clumps were found in August, but Brazil's energy minister began attending meetings on the matter in October, according to Reuters, which cited government records. In October, an emergency plan was also activated. Activists told the wire service they worried the government wasn't doing enough. Separately, Brazil's government has recently faced international criticism for its handling of fires plaguing the Amazon rainforest. The country notably rejected an offer of international aid to combat the flames.

Boat Carrying 600 Gallons of Oil Sinks off the Galápagos - A barge containing 600 gallons of diesel fuel sank off the Galápagos Islands Sunday, prompting fears for the island chain's unique wildlife. The oil spill occurred off San Cristóbal Island when workers were attempting to load a shipping container onto a barge called the Orca, The New York Times reported. A video shared on social media shows the container falling onto the boat, pulling the crane holding it with it and tipping the boat on its side as people dive off. One was injured, DW reported. "The illegal and dangerous logistics operation carried out on the dock must be moved to another site," conservation group SOS Galápagos tweeted Sunday. The group also warned the oil would reach a popular tourist beach, CBS News reported. Authorities declared an emergency and began an investigation into the spill, The New York Times reported. Ecuador's Ministry of the Environment shared pictures on social media of cleanup efforts undertaken by the Coast Guard and Galápagos National Park. So far, these efforts have paid off. Ecuadorian President Lenín Moreno said on Twitter Monday that the spill was under control. "Not a single species has been affected by the spill in San Cristóbal," Ecuador's Environment Minister Raul Ledesma said, DW reported Tuesday. He said veterinarians had tested several iguanas and two sea lions near the spill site and found they had not been affected. However, authorities are still worried about what could happen if they do not recover the oil tanks that sank. "We are very concerned about the recovery work of the tanks because there could be a potential spill if it is not done efficiently and swiftly," Ledesma said. The Galápagos are home to unique species not found anywhere else on the planet, according to CNN. The islands' unique wildlife and ecosystems helped Charles Darwin develop his theory of evolution, and the chain is now a UNESCO World Heritage site.

Ecuador says Galapagos fuel spill under control - Ecuador officials announced Sunday that a fuel spill in the Galapagos Islands, caused when a barge sank carrying 600 gallons of diesel fuel, was "under control." Authorities had activated emergency protocols earlier Sunday to contain the environmental impact of the spill in the Galapagos archipelago, a UNESCO World Heritage Site that is home to one of the most fragile ecosystems on the planet. "The situation is under control, and a series of actions have been deployed to mitigate the possible effects," the presidential communications office said in a statement, adding the response operation had "controlled" the spill. The accident, in which one person was injured, occurred in a port on San Cristobal Island, the easternmost island in the chain, when a crane collapsed while loading a container holding an electric generator onto a barge. The falling container destabilized the ship, which was carrying 600 gallons of diesel fuel, causing it to sink. The generator and the loading crane were also submerged. The Emergency Operations Committee (COE) took "immediate action to reduce the environmental risk" in the so-called Enchanted Islands. Personnel from the Galapagos National Park (GNP), the official nature reserve authority, and the Ecuadorian Navy set up spill containment barriers and oil absorbent cloths around the fuel patch. Galapagos minister Norman Wray told reporters that work was under way to recover the diesel. He also said the generator, which was intended to supply energy on Isabela Island, and the barge would be replaced "as soon as possible." Isabela Island, the largest island, is currently facing energy rationing. Wray assured reporters that food supply levels in the Galapagos would remain normal despite the loss of the barge. 

South Sudan oil spill causes environmental damage, health problems - Two months after a pipeline ruptured and spilled crude oil over a wide swath of South Sudan's former Unity State, residents and government officials are grappling with a new pipeline break and the subsequent impact of leaks on public safety and the environment. In the latest incident, residents said oil leaked at Kailoy, about 10 kilometers west of the Unity Oil Field. They said it caught fire Dec. 21 and burned for two days, sending thick plumes of smoke into the air. The Chinese Greater Pioneer Operating Company (GPOC) owns and operates the field. Area residents said they were concerned about the failure of oil companies to detect spills and their inability to put out the fires that the residents said were likely started by nearby charcoal makers. Kailoy resident Kai Pan said he thought local charcoal makers inadvertently caused the fire. "The fire started at 2 p.m. [local time]. We saw that it started where people were cutting trees for [burning] charcoal, and it started going toward the oil pipeline, which is just 10 kilometers from Bentiu oil camp," Pan told VOA's South Sudan in Focus program. Bentiu is the capital of Northern Liech state and is near the border with Sudan. Pan said that after the fire broke out, cases of airborne diseases, which many suspected were caused by oil fumes, were reported in the area. "People are now having a lot of coughing in this area, and also there are some skin problems and also eye pain among residents of this area," Pan said. He said oil-spill-related fires were still burning near Kailoy, posing a threat to the community. Duol Bim, director-general at Northern Liech state's health ministry, said oil companies operating in South Sudan do not follow international safety procedures in handling oil spills. "They don't have firetrucks, they don't have fire extinguishers, they have nothing. They went there but could not do anything to make sure that the fire is contained. It was just left like that, and it continued burning for two days," Bim told South Sudan in Focus. Bim said GPOC not only failed to detect the oil leakage soon after it happened but also had failed to extinguish the fires. "In this case, there is negligence on the side of the oil company that is in the area, because if leakages are happening and are not being detected on time, it shows that the oil company is not doing a good job," said Bim. In October, a previously undetected oil leak from a burst pipeline in the Budang area of former Unity State was discovered by a hungry soldier who was hunting for wild fruits.

Repsol to be fined by EPA for mud spill offshore -  The Environmental Protection Agency (EPA)  is preparing to levy a fine against Spanish oil company, Repsol for a mud spill which occurred offshore in the Kanuku Block, even as the agency mulls lobbing government to push for 24/7 oversight and for new legislation to raise the paltry levies attached to such incidents.

Exxon Hits More Oil Pay Offshore Guyana -- Exxon Mobil Corp. and Hess Corp. Monday reported another oil discovery offshore Guyana at the Mako-1 well southeast of the Liza Field, which just achieved first oil. According to ExxonMobil, Mako-1 on the Stabroek Block adds to the acreage’s 6 billion-plus oil-equivalent barrels of estimated recoverable resources. ExxonMobil noted that drilling activities in Guyana continue with four drillships to further explore and appraise new resources and develop the resources within approved projects. The supermajor’s Esso Exploration and Production Guyana Limited operates the Stabroek Block and owns a 45-percent interest in it. Owners of the remaining 55 percent include coventurers Hess Guyana Exploration Ltd. (30 percent) and CNOOC Petroleum Guyana Limited (25 percent). Hess reported separately that Mako-1 encountered approximately 164 feet (50 meters) of high-quality oil-bearing sandstone. The company added the well was drilled in 5,315 feet (1,620 meters) of water.

Apache, Total to jointly develop Block 58 offshore Suriname - Apache Corp. and Total SA have formed a joint venture to explore and develop Block 58 offshore Suriname. The companies will each hold a 50% working interest in the block, which comprises about 1.4 million acres in water depths of less than 100 m to more than 2,100 m. Apache will operate the first three exploration wells in the block, including the Maka Central-1 well, and subsequently transfer operatorship to Total. Upon meeting certain drilling commitments, the partnership has the rights to explore the entire block through mid-2026 without acreage relinquishments, providing for what Apache described as “a thorough evaluation of the multiple play types we have identified in this emerging oil-prone basin.” “Apache and Total are encouraged by the preliminary information and test results from the two upper Cretaceous play types encountered thus far,” added John J. Christmann, chief executive officer and president of Apache. “Deepening and testing operations continue at Maka Central-1. Following the completion of these activities, the rig will be moving to the next location.” In exchange for its 50% working interest, Apache will receive various forms of consideration, including: $5 billion of cash carry on Apache’s first $7.5 billion of appraisal and development capital; 25% cash carry on all of Apache’s appraisal and development capital beyond the first $7.5 billion; various cash payments in conjunction with closing of the joint venture agreement and future production from joint development projects; and reimbursement of 50% of all costs incurred to date in Block 58.

Shell Makes Significant Find Offshore Australia -- Shell Australia has announced a “significant” gas and condensate discovery in the Browse Basin off the North West Coast of Western Australia. The find was made through the Bratwurst-1 exploration well, which was said to be successfully concluded after a 78-day campaign. The discovery is located 99 miles north east of the Shell operated Prelude FLNG facility and presents an opportunity for a future tie-back to Prelude, according to Shell. No figures were released in connection with the discovery, but it was said to support Shell’s growth plans for “more and cleaner energy, with LNG being the predominant focus for Shell in Australia”. Shell Australia has a record of investing in large projects. In October this year, Shell’s QGC business announced that the 500th cargo of LNG had sailed from its LNG plant on Curtis Island, Queensland. In June, Shell revealed that the first shipment of LNG had sailed from its Prelude FLNG facility located 295 miles North East of Broome in Western Australia.

Leviathan Delays Start of Commercial Operations  | Rigzone -- The launch of production at Israel’s Leviathan natural gas field has been delayed pending permits from the Ministry of Environmental Protection. “The flow of gas from the reservoir hasn’t yet begun,” Israel’s Delek Drilling LP, a partner to the project, said Tuesday in a statement to the Tel Aviv Stock Exchange. “The partnership believes that it will begin in coming days, after the necessary permits are received from the Ministry of Environmental Protection.” The statement didn’t elaborate. Environmental groups concerned about the field’s impact on air pollution and public health have been waging a protest against its operations and last week won a daylong temporary injunction from an Israeli court. They were planning to abandon their homes in towns along the shoreline for the first 24 hours of the platform’s operation. The Israeli government hailed the discovery of Leviathan in 2010 as a milestone to ensuring energy independence and a tool to bolster its geopolitical influence through major export deals. Delek Drilling LP and U.S.-based Noble Energy Inc. own about 45% and 40% of the project respectively.

Kuwait, Saudi Arabia to resume joint oil production - Al-Khafji Joint Operations (KJO) and Wafra Joint Operations (WJO) will resume crude oil production in the Saudi-Kuwaiti divided zone in 2020, starting gradually but targeting year-end production of 325,000 b/d. The two countries agreed to terms Dec. 24, 2019. Production was suspended at KJO in October 2014 and WJO in May 2015. Combined capacity is estimated at 500,000 b/d.  KJO, a partnership of Kuwait Gulf Oil Co. (KGOC) and Aramco Gulf Oil Co. (AGOC), manages offshore operations in a 7,000-sq km area of the partitioned zone between Kuwait and Saudi Arabia. WJO, partnering KGOC and Saudi Arabian Chevron, manages production in the 5,000-sq km onshore portion of the partitioned zone. KJO includes four major fields—Khafji, Hout, Lulu, and Dorra—with production and potential production horizons including First Bahrain sand, Second Bahrain sand, Ratawi limestone, Ahmadi limestone, Mauddud limestone, Wara sand, and Zubair sand.WJO includes six major fields—Wafra, South Fuwaris, South Umm-Gudair, Humma, Arq, and North Wafra—with producing and potential producing reservoirs including First Eocene, Second Eocene, Maastrichtian, Hartha (Lower Senonean), Ahmadi sand, Wara sand, Third Burgan, Ratawi sand, Ratawi limestone, Ratawi oolite, and Marrat. 

‘It’s a complete mess’: Energy market in flux ahead of a global shipping revolution, analysts warn A much-anticipated and historic rule change to shipping fuel standards will come into force in less than two weeks, leaving energy market participants braced for a period of confusion and uncertainty.On January 1, 2020, the International Maritime Organization (IMO) will impose new emissions regulations designed to significantly curb pollution produced by the world’s ships. Amid a broader push toward cleaner energy markets, the IMO is poised to ban shipping vessels using fuel with a sulfur content higher than 0.5%. At present, the upper limit on sulfur oxides is 3.5%.Major oil companies and shipowners have spent billions of dollars preparing for the changes but energy analysts have expressed some concern that many in the oil and shipping industries still appear to be unprepared.“The market is in complete flux. Nobody seems to have the answers of how this will play out,” Patrik Berglund, CEO of Xeneta, a Norwegian-based company that crowdsources freight data, told CNBC via telephone.Berglund had previously described IMO 2020 as the “opportunity of a lifetime” for shipping liners to raise their prices, since the entire industry expected increased costs.“We would have expected to see these cost increases already… (but) shipping liners are definitely not capitalizing on this opportunity. It is flabbergasting.”“It is a complete mess and the customers are suffering with all of this uncertainty,” he added.The new regulations are the result of a recommendation that came from a subcommittee at the United Nations (UN) more than a decade ago and was adopted in 2016 by the UN’s IMO, which sets rules for shipping safety, security and pollution. The entire industry is under intense pressure to slash its sulfur emissions, given the pollutant is a component of acid rain, which harms vegetation and wildlife and is also blamed for some respiratory illnesses.  More than 170 countries, including the U.S., have signed on to the fuel change.

Patterns of GPS Spoofing at Chinese Ports - Aggressive GPS spoofing impacting shipping has been detected in over 20 Chinese coastal sites during 2019. These included the ports of Shanghai, Fuzhou (Huilutou), Qingdao, Quanzhou (Shiyucun), Dalian, and Tianjin. GPS spoofing in Shanghai had been discussed informally among maritime interests for months before a formal report was filed with the U.S. Coast Guard earlier this year. The non-profit C4ADS became interested and found that spoofing had been going on for some time. Also that, over time, many of the false vessel positions tended to form a circle some distance inland. The MIT Technology Review published an article about this phenomena last month. The MIT article caught the interest of an analyst at the environmental non-profit Skytruth who decided to take a more comprehensive look. Evaluating a larger data set of ship AIS data, analyst Bjorn Bergman discovered at least 20 locations near the Chinese coast where similar spoofing had taken place in 2019. 14 of these “spoofing circle” locations were oil terminals. The most frequent occurrences, by far were at the port of Dalian in northern China, close to the border with North Korea. The timing of the spoofing, imposition of sanctions on purchase of Iranian oil by the United States, and observations by others of Iranian oil being received by China, suggests that some of the spoofing may be designed to help conceal these transactions. Of the locations not associated with oil terminals, three were government offices and one was the headquarters of the Qingjian industrial group, a huge engineering and construction conglomerate.

Hedge Funds Boost Bets on Rising US Crude Prices - Hedge funds boosted bets on rising U.S. crude prices to the highest level in more than seven months, helping support oil’s first full week above $60 a barrel since May. Their net-bullish wagers on West Texas Intermediate crude climbed 19% in the week ended Dec. 17, data released Friday show. Optimism over a U.S.-China trade truce and OPEC cuts helped push futures to a three-month high, though the rally has fizzled somewhat. “I expect to see more length in the market as a function of what looks to be the successful negotiation of Phase 1 of the U.S.-China trade pact, as well as the OPEC meeting with their pledge to reduce output,” said Andrew Lebow, senior partner at Commodity Research Group in New York. The improved outlook for trade and OPEC’s pledge to deepen output cuts are helping U.S. oil head for a rebound of more than 30% this year, its best performance since 2016. That’s after a 25% slump in 2018. It also seems that America’s shale boom is slowing down and several forecasts for the country’s crude output next year have been lowered. “U.S. production estimates continue to fall,” said Rebecca Babin, senior equity trader at CIBC Private Wealth Management. “A likely return of the downside from last year was mitigated by Phase 1 of the China-U.S deal, and OPEC staying on price stability theme instead of market share.” Money managers’ WTI net-long position, or the difference between bullish and bearish bets, climbed to 272,218 futures and options, the highest level since April, according to U.S. Commodity Futures Trading Commission data. Long-only wagers jumped 13%, while shorts declined 24%.

Oil Down as Kuwait Nears Deal with Saudis on Output-- Oil extended losses after the biggest decline in three weeks as Kuwait signaled a deal with Saudi Arabia to renew crude output along their border and as U.S. shale explorers increased drilling. February futures dropped 0.4% in New York after falling 1.2% on Friday, the most since Nov. 29. The shared neutral zone, which has been shut for at least four years due to disputes between the two countries, can produce as much as 500,000 barrels a day. U.S. explorers last week boosted drilling by the most in almost two years, according to data from Baker Hughes Co. on Friday. Oil is up about 9% this month after the U.S. and China struck a preliminary trade pact and the Organization of Petroleum Exporting Countries and its allies agreed to deepen output cuts. Hedge funds increased bullish bets in the week ended Dec. 17 to the highest level in more than seven months on rising crude prices, according to data released Friday. “Oil prices will continue to benefit from positive developments in the U.S.-China trade,” Stephen Innes, a market strategist at AxiTrader, said in a note. “The seasonal demand slowdown in the first quarter could be an issue for this bullish view.” West Texas Intermediate for February delivery fell 21 cents to $60.23 a barrel on the New York Mercantile Exchange as of 7:34 a.m. London time. The contract declined 74 cents to settle at $60.44 on Friday. Brent for February settlement fell 14 cents, or 0.2%, to $66 a barrel on the ICE Futures Europe Exchange. The contract fell 40 cents to close at $66.14 on Friday. The global benchmark crude traded at a $5.78 premium to WTI. Resuming output at the Wafra and Khafji oilfields in the neutral zone depends on a political decision and a final agreement, Kuwait’s Oil Minister Khaled Al-Fadhel said on Sunday. Even if production resumes, the area wouldn’t add oil to global markets because both nations adhere to OPEC supply limits, a person familiar with Saudi thinking said in October.

Oil moves higher, building on 3rd straight week of gains - Oil prices were little changed on Monday as Russia said an OPEC-led producer group may consider easing output cuts next year, offsetting support from some investor optimism that an initial U.S.-China trade deal would be signed soon. Brent crude was up 28 cents, or 0.4%, at $66.42 per barrel in thin trading ahead of the Christmas holiday. West Texas Intermediate gained 8 cents to settle at $60.52 per barrel. The Organization of the Petroleum Exporting Countries and other top producing nations led by Russia agreed this month to extend and deepen output cuts in the first quarter of 2020. However, Russian Energy Minister Alexander Novak said on Monday that the group, known as OPEC+, may consider easing the output restrictions at its meeting in March. “We can consider any options, including gradual easing of quotas, including continuation of the deal,” Novak told Russia’s RBC TV in an interview recorded last week, adding that Russia’s oil output was set to hit a record high this year. Non-OPEC global supply is expected to rise next year due to higher output from countries including the United States, Brazil, Norway and Guyana, which became an oil producer last week. Another source of more oil could emerge in the coming months after Kuwait indicated that a longstanding dispute over the “Neutral Zone” on its border with Saudi Arabia will be resolved by the end of 2019. Production at two large oil fields in the Neutral Zone was halted more than three years ago, cutting output by some 500,000 barrels per day. “Oil prices remained soft after Friday’s drop that stemmed from the Saudi Arabia and Kuwait deal to resume production along their border ... The short-squeeze on oil may be running out of steam but if WTI and Brent prices can hold $60 and $65 respectively, we could see prices remain supported going into the first few weeks of January,”

Bullish Sentiment Keeps Oil Above $60   - Oil prices were relatively lifeless at the start of the week, holding onto recent gains, but not moving much in either direction.  . A Wall Street Journal survey of 13 major investment banks finds that analysts see oil prices falling next year as the OPEC+ deal fails to rally prices. The average Brent forecast is $61.23 per barrel in the first quarter of 2020, barely up from last month’s forecast despite the deeper production cuts. In the short run, investors are bullish – net-bullish wagers on oil futures rose to their highest level in seven months last week.  Permian shale wells are producing a higher gas-to-oil ratio than expected, another blow to shale drillers’ profits. “Activity levels are no longer what they were,” said Artem Abramov, head of shale research at Rystad Energy. “The oil ratio is no longer sufficient to offset gas in older wells, so we’re seeing some increase in basin-wide” gas-to-oil ratios. The focus on the Delaware sub-basin is also contributing, as that area is gassier. . Saudi Arabia and Kuwait are on the brink of a deal to restart production at the Neutral Zone oil fields that lie on the border of the two countries, potentially ending a five-year dispute. The fields can produce 500,000 bpd but were shut down in 2014. The restart would still be subject to the OPEC+ deal, meaning any increase would likely need to be offset elsewhere.  Equinor and Rosneft agreed to jointly develop the Severo-Komsomolskoye oilfield in the Arctic.  Exxon and Hess Corp. started production at the Liza field in offshore Guyana, a highly-anticipated project that will ramp up to 120,000 bpd in the coming months. On Monday, Exxon saidit made another discovery at its Mako-1 well southeast of the Liza field.  Total said that it would pay a bonus of $100 million as part of a previously announced deal with Apache to develop an offshore project in Suriname. The project adds to the excitement around the Guyana-Suriname basin.  Lending to oil companies in the Permian is slowing, as banks seek to reduce their exposure. Some banks are growing more concerned that the reduced value of shale assets could fail to cover for missed debt payments. President Trump signed a new law that puts sanctions on any companies working on the Nord Stream 2 pipeline, and a Swiss company working on the project suspended construction. However, the sanctions probably won’t stop the project altogether, as it is very close to completion.  The pressure on Iraq from OPEC+ members to comply with the deal is bearing fruit – Iraq’s output is expected to be 110,000-bpd lower this month. But Iraq would still be about 200,000 bpd over its agreed upon limit. “It seems a stretch to imagine that they will voluntarily reduce production by the amount that is required,” Daniel Gerber, chief executive officer of Petro-Logistics, told Bloomberg.

Oil Up as US Crude Stockpiles Seen Shrinking (Bloomberg) -- Oil traded above $60 a barrel ahead of U.S. government data forecast to show crude stockpiles shrank, while Iraq trimmed output as Saudi Arabia applied pressure on nations to better comply with cuts. Futures were steady in New York after adding 0.1% on Monday. American crude stockpiles fell by 1.7 million barrels last week, according to a Bloomberg survey before Energy Information Administration data on Friday. U.S. industry figures are due later Tuesday. Iraq pared output by 110,000 barrels a day in December, according to Petro-Logistics SA. Oil has rallied about 10% this month after the U.S. and China made a breakthrough on trade and the Organization of Petroleum Exporting Countries and its partners including Russia agreed to deepen output cuts. American crude inventories are shrinking even as the nation pumps near record levels and shale explorers boost drilling. “Prices are rising but the market is monitoring data on U.S. oil production and inventories,” Jun Inoue, senior economist at Mizuho Research Institute, said by email. Crude has been bolstered by the OPEC+ decision to cut production further and the progress of trade talks between the U.S. and China, he said. West Texas Intermediate for February delivery rose 5 cents to $60.57 a barrel as of 7:28 a.m. London time on the New York Mercantile Exchange. The contract added 8 cents to close at $60.52 on Monday. Brent for February settlement rose 12 cents to $66.51 a barrel on the ICE Futures Europe Exchange. The contract gained 25 cents to close at $66.39 on Monday. The global benchmark traded at a $5.93 premium to WTI.

Oil gains 1% on US-China Trade Deal Expectations  - Oil prices rose on Tuesday in thin pre-Christmas trading after Russia said cooperation with OPEC on supply cuts would continue and amid optimism that the United States and China could finalize a trade agreement. Brent crude was up 81 cents, or 1.22%, at $67.20 a barrel, while U.S. West Texas Intermediate gained 59 cents, or 1%, to settle at $61.11 per barrel. OPEC and Russia will continue their cooperation as long as it is “effective and brings results,” Russian energy minister Alexander Novak said in an interview on Monday. OPEC and allies agreed in November to extend and deepen output curbs in place since 2017. Under the reduced output, as much as 2.1 million barrels per day (bpd) could be taken off the market, or about 2% of global demand. Still, OPEC needs to do more to balance the market on a sustainable basis, Bjornar Tonhaugen, head of oil market research at Rystad Energy, said in a note. “The OPEC cuts didn’t fully solve the problem instead they offer a light bandage to get through the first quarter of 2020,” said Tonhaugen. The market also rose as U.S. President Donald Trump said on Tuesday he and Chinese President Xi Jinping will have a signing ceremony to sign the first phase of the U.S.-China trade deal agreed to this month.. Trade tensions between the two countries have weighed on the oil market because of worries of a slowdown in demand growth. Still, the market faces headwinds from growing supply. A deal signed on Tuesday between Kuwait and Saudi Arabia on the Neutral Zone between the two countries could add to supply next year. The agreement aims to end a five-year dispute between the OPEC members and reopen fields which can produce 0.5 million bpd, or 0.5% of global supply. U.S. oil major Chevron Corp, which helps operate the fields, said full production was expected within 12 months.

Global Crude Oil Prices Hit 3.5-Month Highs as Russia, Trump Reaffirm Deal Commitments -- Global crude oil prices hit three-and-a-half-month highs on Tuesday based largely on Russia’s pledge to honor production cuts promised to OPEC and President Donald Trump’s reiteration of a trade deal with China. London-traded Brent, the global benchmark for crude oil, rose 81 cents, or 1.2 percent, to $67.20. Earlier in the day, it hit $67.25 – its highest value since mid-September. New York-traded West Texas Intermediate (WTI), the US crude benchmark, was up 61 cents, or 1 percent, at $61.13 per barrel. Both Brent and WTI are up double digits on the year, with the UK benchmark rising 25 percent while its US peer showing a 35 percent gain. Tuesday’s rally in oil came after Russian Energy Minister Alexander Novak was quoted saying that Russia and OPEC will continue their cooperation on oil production cuts so long as the pact was effective and brought positive results. The Organization of the Petroleum Exporting Countries (OPEC) and other oil producing nations led by Russia announced earlier this month plans to deepen their joint output cuts of 1.2 million barrels per day to as much as 2.1 million barrels per day, or 2.1 percent of world supply, in the first quarter of 2020. Tuesday’s rally in oil also came after Trump told reporters at his Mar-a-Lago resort in Florida’s Palm Beach that there will be a signing ceremony to formalize Phase One of the US-China trade deal that was negotiated earlier this month.

U.S. crude oil stocks fall more than expected in week -API - (Reuters) - U.S. crude oil stocks fell more than expected in the most recent week while gasoline and distillate inventories increased, data from industry group the American Petroleum Institute showed on Tuesday. Crude inventories fell by 7.9 million barrels in the week to Dec. 20 to 444.1 million barrels, compared with analysts’ expectations for a draw of 1.83 million barrels. Crude stocks at the Cushing, Oklahoma, delivery hub fell by 2.2 million barrels, API said. Refinery crude runs fell by 514,000 barrels per day, API data showed. Gasoline stocks rose by 566,000 barrels, compared with analysts’ expectations in a Reuters poll for a 2 million-barrel gain. Distillate fuel inventories, which include diesel and heating oil, rose by 1.68 million barrels, compared with expectations for an 867,000-barrel gain, the data showed. U.S. crude imports fell last week by 331,000 barrels per day to 6.4 million bpd.

Oil Prices Continue to Reach New Highs Based on Expectations of US Stockpile Reductions - Crude oil prices hit fresh highs on Thursday for nearly four-month period based on expectations that US inventories fell sharply last week as refineries turned out more gasoline and other fuel products for the holiday season and on China bolstering hopes for an imminent trade deal with the United States. London-traded Brent - the global benchmark for crude oil - increased 40 cents, or 0.6 percent, to $67.60 by 11:00 a.m. Brent increased to $67.89 earlier in the day - its highest value since mid-September. New York-traded West Texas Intermediate (WTI) - the US crude benchmark - was up 44 cents, or 0.7 percent, at $61.55 per barrel. Earlier in the day, WTI hit a new high for the past three-and-a-half-month period of $61.76. Crude oil prices spiked after data from the American Petroleum Institute (API) showed a sharp drawdown of 7.9 million barrels in US crude stockpiles last week, versus the 1.8-million-barrel decline forecast by analysts. The API data suggest that refiners turned out more gasoline and other fuel products last week in anticipation of higher road travel and package deliveries for the holiday season. However, the API data has to be affirmed by official numbers from the US Energy Information Administration that is due on Friday.  Oil prices also increased as a result of stocks hitting record highs on Thursday after China’s Commerce Ministry spokesman Gao Feng stated that Beijing was in close touch with Washington on a tentative Phase One trade deal. Wall Street, a proxy for oil market sentiment, has had one of its biggest and most prolonged bull runs this year on optimism over the US-China trade deal and US economic indicators.

Oil prices end at 3-month high as report shows 7.9 million drop in U.S. crude inventories - Crude-oil prices settled solidly higher Thursday, in thin postholiday action, as a weekly inventory report indicated a bigger-than-expected decline in stockpiles for oil. American Petroleum Institute reported late Tuesday that U.S. crude supplies fell by 7.9 million barrels for the week ended Dec. 20, according to sources. That was more than analysts’ consensus expectations for a draw of draw of 1.83 million barrels, according to Reuters. The weekly inventory report also showed a 2.2 million barrel decline in key U.S. oil delivery hub Cushing, Okla. The API data came after that report showed a major buildup in stockpiles last week and the current report could provide a lift for crude prices which have been steadily climbing lately, wrote Phil Flynn, senior market analyst at The Price Futures Group. “It appears that the API wanted to make up for the lost time and this reflects growing global oil demand,” he wrote in a Thursday research report. West Texas Intermediate crude for February delivery, the U.S. benchmark grade, added 57 cents, or 0.9%, to settle at $61.68 a barrel on the New York Mercantile Exchange, after rising 1% on Tuesday. The settlement marked the highest for the benchmark since Sept. 16, according to Dow Jones Market Data. February Brent crude rose 72 cents, or 1.1%, to finish at $67.92 a barrel on ICE Futures Europe, following a 1.2% gain in the prior session. The international benchmark also finished at a more than three-month high. Trading was mostly subdued, with a number of markets remaining closed for the holidays. Commodity markets were closed on Wednesday for the Christmas holiday period and that closure has delayed the release of U.S. government data from the Energy Information Administration on crude stocks and those for natural gas, which will both be distributed on Friday.

Oil turns negative ahead of US inventory data  - Oil prices retreated from three-month highs on Friday, moving lower despite upbeat economic data from China and the United States and optimism over a trade deal between the two major economies. Brent crude futures shed 29 cents to trade at $67.63 per barrel, after previously rising as high as $68.10, the highest since September. The West Texas Intermediate contract fell 35 cents, or 0.6%, to $61.32 per barrel. Volume of oil trade remained thin in the Christmas holidays and New Year breaks. Data on Friday showed profits at China’s industrial firms rose at the fastest pace in eight months in November. Among sectors, the chemical, petroleum processing and steel industries reported recovering profits last month due to rebounding market demand and rising prices amid easing trade hostilities with Washington. China and the United States cooled their 17-month long trade war earlier this month, announcing a Phase 1 agreement that would reduce some U.S. tariffs in exchange for more Chinese purchases of American farm products. The lingering ripple effect of the trade row, however, showed up in data from Japan, the world’s third-biggest economy, on Friday as industrial output shrank for a second month in November. In the United States, a survey on Thursday showed that online holiday purchases by U.S. consumers reached a record, beating analysts’ expectations and sending U.S. stocks to fresh.

Oil Near 3-Month High on Signs of Shrinking Supplies  | Rigzone - Oil held gains near the highest level in more than three months on indications of shrinking U.S. crude stockpiles and optimism in the global economic outlook. Futures rose as much as 0.4% in New York after adding 0.9% on Thursday, set for the biggest monthly increase since January. American crude stockpiles fell by 1.5 million barrels last week, according to a Bloomberg survey before government data on Friday. Jobless claims in the U.S. fell to a three-week low, reflecting a solid labor market in the world’s no. 1 economy. Oil is up about 12% this month after the U.S. and China made a breakthrough in their prolonged trade dispute and as the Organization of Petroleum Exporting Countries and its allies agreed to deepen output cuts. The American Petroleum Institute reported Tuesday that crude stockpiles dropped by 7.9 million barrels last week, according to Reuters, which would be the largest draw since August if confirmed by official data. “We have some good economic data coming out of the U.S. and there’s some buying euphoria,” said Howie Lee, an economist at Oversea-Chinese Banking Corp. “Crude has been on a steady upward trend from October when the U.S. and China first discussed a trade deal, and in the absence of any risk on the horizon, markets are trading on the back of this optimism.” West Texas Intermediate for February delivery rose 22 cents to $61.90 a barrel on the New York Mercantile Exchange as of 8:23 a.m. London time. The contract added 57 cents to settle at $61.68 on Thursday, the highest level since Sept. 16. Prices are also heading for a fourth weekly advance, the longest run of gains since April. Brent for February settlement climbed 24 cents to $68.16 a barrel on the ICE Futures Europe exchange. Prices are up about 9% this month. The spread between the global benchmark crude traded at a $6.25 premium to WTI. The Energy Information Administration is forecast to report a second weekly decline in crude stockpiles. American inventories are shrinking even as the nation pumps oil at near-record levels and shale explorers boost drilling. Separately, U.S. jobless claims dropped to 222,000 in the week ended Dec. 21 from 235,000, according to Labor Department figures released Thursday.

WTI Rebounds On Bigger Than Expected Crude Draw - Oil has retraced some of the gains from light trading yesterday, but prices are still set for the biggest monthly gain in almost a year amid optimism on trade and speculation that supplies are shrinking.“A lot of the recent strength in oil prices has been speculative fund flows and short covering in the front months into year-end 2019.” said Leo Mariani, an analyst at Keybanc Capital Markets.“We think there is a good chance that oil prices will be higher in several years as non-OPEC production growth slows materially into the next decade.”Notably, API reported that U.S. stockpiles dropped 7.9 million barrels last week (gasoline +566k, distillates +1.68mm), while Russia cut crude output. Olivier Jakob, managing director of consultant Petromatrix GmbH, adds that a “weekly stock draw could provide a final boost for the end-year print,” referring to the government report.  DOE:

  • Crude -5.474mm (-1.5mm exp)
  • Cushing -2.393mm
  • Gasoline +1.963mm
  • Distillates -152k

After the huge API reported crude draw, DOE confirmed it with a bigger than expected 5.474mm drop in inventories (and Cushing stocks down for the 7th week in a row)... Crude production hovered near record highs and we note that the oil rig count unexpectedly surged by 18 last week - the biggest weekly jump since Feb 2018... WTI rallied on the API data, reverted lower overnight before surging back to new cycle highs as stocks opened yesterday. The opposite has happened so far today with a pre-open spike that just failed to tag $62, and then WTI tumbling as stocks rolled lower. But the bigger than expected crude draw sent prices higher...

Oil prices ends day and week higher as EIA report shows bigger-than-expected crude drop - Crude oil prices edged higher Friday and finished a holiday-shortened week near a three-month peak, after a report showed a bigger-than-expected decline in U.S. stores of crude and its byproducts. The Energy Information Administration reported that U.S. crude supplies fell by 5.467 million barrels for the week ended Dec. 20. Analysts polled by S&P Global Platts had forecast a decrease of 3 million barrels, although the less closely followed American Petroleum Institute report showed a 7.9 million-barrel tumble late Tuesday, according to sources. EIA data also showed supply increases of 1.963 million barrels for gasoline stocks and a decline of roughly 152,000 barrels for distillates. U.S. energy reports were delayed this week due to the Christmas holiday. West Texas Intermediate crude for February delivery, the U.S. benchmark grade, rose 4 cents, or less than 0.1%, to end at $61.72 a barrel in up-and-down trade on the New York Mercantile Exchange. The slight gains, however, helped the most-active contract hold around its highest price since Sept. 16, according to Dow Jones Market Data, with a weekly gain of about 2.1%. February Brent crude, meanwhile, added 24 cents, or 0.4%, at $68.16 a barrel on ICE Futures Europe, following a 1.1% gain in the prior session. That contract expires on Dec. 30. The March contract, which is currently the most active, added 11 cents, or 0.2%, at $66.87 a barrel. For the week, Brent’s February contract climbed 3.7%, while March Brent rose 2.6% in the week to date. Both Brent oil and WTI have risen for four consecutive weeks. Phil Flynn, senior market analyst at The Price Futures Group, said that the EIA inventory data reflect refiners, who process crude, ramping up activity and helping to take down supplies. “It looks like refiners are back…” Flynn told MarketWatch. “So very supportive!” All that said, market participants also were digesting a report signaling that the group known as OPEC+, including members of the Organization of the Petroleum Exporting Countries and allies like Russia, may consider ending a pact to reduce global production next year.

Oil Ends up 4th Week in a Row; Looks Ripe for Correction – Oil prices settled up on Friday after the U.S. government reported a much bigger fall in crude inventories than anticipated. But analysts said the market was probably ripe for a correction after gaining nearly 14% since the end of October. West Texas Intermediate futures, the benchmark for U.S. crude, settled up four cents at $61.72 per barrel. It earlier hit a 3-1/2 month high of $61.97. London-traded Brent, the global crude benchmark, closed the regular New York session up 24 cents at $68.16. It earlier rose to a mid-September high of $68.31. Both WTI and Brent have risen about without pause for four weeks now, their longest streak of gains since April. Aside from a cumulative gain of almost 14% over the past two months, WTI is up almost 36% for 2019, while Brent has gained about 26%. Friday's bounce in oil came after the EIA announced that U.S. crude inventories fell by 5.474 million barrels for the week ended Dec. 20. The market was expecting a drop of about 1.7 million barrels, according to forecasts compiled by The numbers were delayed until Friday due to the Christmas holidays. While the drawdown announced by the EIA was larger than unexpected, Friday's market gains were muted, "because the market has gone up so much over the past two weeks, riding the wave of the China deal talk and other demand prospects," Gasoline inventories rose by 1.96 million barrels, compared with expectations for a rise of about 1.66 million barrels. Distillate inventories fell by 152,000 barrels, versus forecasts for a build of 800,000 barrels. Crude imports came in higher at 6.8 million barrels per day, and refinery runs remained high, above 93%. “On the bearish side, crude production returned to the record high levels of 12.9 million barrels per day, though the increase on the week is just about 100,000 bpd,” . “And exports fell by 236,000 bpd to around 3.4 million.”

A Bullish End To The Year For Oil Markets - Oil seems set to close out the year on a high note. Oil prices are roughly 30 percent higher than they were at the start of the year, although 12 months ago saw a sudden and steep downturn. Still, WTI rose above $61 in recent days, and investors are more bullish than they have been in months. That does not mean that the downside risks have gone away – the IEA still sees a supply surplus in the first quarter – but there is now hope that the market is closer to balance than it has been in a long time.  The U.S. shale industry closes the door on a wild decade, complete with record production levels, but also widespread financial wreckage. The growth-at-all-costs business model just won’t cut it in the 2020s, Liam Denning says for Bloomberg Opinion. After a decade of ups and downs, 2019 may turn out to be a pivotal year – investors began to turn their backs on the shale industry, after repeatedly placing larger and larger bets on the hope that the industry would eventually become profitable. That doesn’t mean that financing has entirely dried up, but in addition to financial hurdles, drillers are also facing rising scrutiny over climate change, which is starting to affect decision-making at big banks. China plans to launch an energy exchange that will make buying and selling energy-related products much easier. But the exchange will also increase—to the worry of many—China’s geopolitical foothold in new markets. There has been an uptick in interest in offshore oil drilling in Gabon, an indication that Africa could become a prime drilling spot in the 2020s. Automotive analysts say that 2020 could be the year of the electric car due to a wave of new EV models that will hit showrooms. In Europe, the number of EV models available will rise from 100 to 175 by the end of the year. That will rise to 330 by 2025. Analysts say that the market share for EVs could rise from 3.4 to 5.5 percent of all cars sold.  There is a growing consensus that the window for major independent LNG export projects is closing, which means that 2020 could be a shakeout year for the sector. “It's getting late. It's getting dark. It's much tougher,” Michael Webber, an independent LNG analyst and managing partner of Webber Research & Advisory, told S&P Global Platts. “Liquidity issues are going to have real teeth to them next year. The rubber will meet the road for a lot of these projects.” Chinese tariffs on U.S. LNG could also delay project sanctioning.

Saudi Arabia sentences five to death for murder of Jamal Khashoggi - Five men have been sentenced to death and another three face a total of 24 years in prison for their roles in the gruesome murder of the dissident journalist Jamal Khashoggi at the Saudi consulate in Istanbul last year, the Saudi public prosecutor’s office has said. Eight of the 11 people on trial were found guilty of the killing, which triggered the kingdom’s biggest diplomatic crisis since the 9/11 attacks as world leaders and business executives sought to distance themselves from Riyadh. However, the investigation concluded “the killing was not premeditated … the decision was taken at the spur of the moment,” the deputy public prosecutor and spokesperson Shalaan bin Rajih Shalaan said, reading the verdict in the Saudi capital on Monday. Three senior figures, including the de facto ruler Crown Prince Mohammed bin Salman’s former top adviser, Saud al-Qahtani, were cleared of wrongdoing during the trial. The verdict contradicts the conclusion of the CIA and other western intelligence agencies that Prince Mohammed directly ordered Khashoggi’s assassination, an allegation the kingdom has strenuously denied. Qahtani was found to have no proven involvement in the killing, after he was investigated and released without charge. He has, however, been sanctioned by the US for his alleged role in the operation.

The US has decided to stop sending bomb-sniffing dogs to two Middle Eastern countries after many of the animals died - The US has made the decision to temporarily stop sending explosive-detection dogs to Jordan and Egypt after discovering that a lot of the animals had died as a result of poor treatment, a report from the Department of State's Office of the Inspector General revealed. The department watchdog, which had previously pushed the Department of State to stop sending dogs to these countries after an earlier investigation uncovered a number of animal deaths and other serious problems, wrote that it had "received notice of additional canine deaths that warrant immediate department action." The report released Friday said that two dogs sent to Jordan died in June and September of this year of "non-natural causes." Specifically, one died from hyperthermia (heatstroke), and the other died after being poisoned by insecticide that was sprayed in or near the kennel. Another dog was found in October to be suffering from leishmaniasis, a preventable disease transmitted by sand flies. The Office of the Inspector General also found that three of the ten dogs provided to Egypt, which has been uncooperative with department officials, died from lung cancer, a ruptured gall bladder, and hyperthermia. The latest report follows an IG evaluation released in September that examined the state of the program in Jordan, a US ally in the counter-terrorism fight. That report, which characterized the conditions the animals were living in as "disturbing," found that "at least 10 canines had died from various medical problems from 2008 through 2016 while others were living in unhealthy conditions."

US Confirms Report Citing Iran Officials as Saying 1,500 Killed in Protests | Voice of America - - The United States has confirmed a news report citing unnamed Iranian officials as saying about 1,500 people were killed in a crackdown by security forces on anti-government protests last month. In a report published Monday, London-based Reuters said it obtained the death toll from three Iranian interior ministry officials who said the fatalities included "at least 17 teenagers and about 400 women as well as some members of the security forces and police." In a Monday tweet, the State Department quoted U.S. Special Representative for Iran Brian Hook as saying the Reuters report "underscores the urgency for the international community to punish the perpetrators and isolate the regime for the murder of 1,500 Iranian citizens."  Special Representative for Iran Brian Hook: “The@Reuters report on the massacre ordered by@khamenei_ir underscores the urgency for the international community to punish the perpetrators and isolate the regime for the murder of 1,500 Iranian citizens.”  — Department of State (@StateDept) December 23, 2019   Reuters' death toll was much higher than the latest fatalities reported by British rights group Amnesty International, which said in a Dec. 16 statement that it documented the killings of at least 304 demonstrators by Iranian security forces in days of unrest that erupted on Nov. 15. Hook's reference to the "murder of 1,500 Iranian citizens" also marked a substantial increase in the Trump administration's assessment of the number of people killed in Iran's crackdown. In a Dec. 5 briefing to reporters, Hook said it appeared that the Iranian government "could have murdered over a thousand Iranian citizens since the protests began."

Thousands protest in Iraq as deadline for new PM looms Thousands of protesters blocked roads and public buildings in southern Iraq Sunday, as the latest deadline for choosing a new prime minister loomed. Anti-government rallies have rocked Baghdad and the Shiite-majority south since October 1, with demonstrators calling for a complete overhaul of a regime they deem corrupt and inefficient. "The revolution continues!" shouted one demonstrator at a protest encampment in central Diwaniyah. Protesters blocked off public buildings one by one in the southern Iraqi city, and put up banners reading "The country is under construction -- please excuse the disruption". Overnight, protesters in Diwaniyah and Basra, another southern city, had declared a "general strike". Sunday marks the latest deadline -- already pushed back twice by President Barham Saleh -- for parliament to choose a new premier to replace Adel Abdel Mahdi, who tendered his administration's resignation last month. Officials say neighbour Iran, a key player in Iraqi politics, wants to install Qusay al-Suhail, who served as education minister in the government of Abdel Mahdi. But protesters categorically reject his candidacy, along with anyone from the wider political establishment that has been in place since dictator Saddam Hussein was deposed in 2003. The protest movement has lost momentum in recent weeks as it has been hit by intimidation, including assassinations perpetrated by militias, according to the UN. Around 460 people have been killed since the protests began nearly three months ago, and some 25,000 have been wounded. But the movement appeared to regain some confidence on Sunday. Dozens of protesters blocked roads linking southern cities to Baghdad with burning tyres, an AFP correspondent said. In Karbala and Najaf, two Shiite holy cities, striking students closed schools and gathered in their thousands, AFP correspondents said.In Nasiriyah, protesters blocked bridges and several roads while all public buildings remained closed. Protesters are demanding the fall of Saleh and parliament speaker Mohammed al-Halbussi, accusing them of procrastinating.

Canada Follows US Lead By Ignoring OPCW Scandal  - Among the basic principles of reporting, as taught in every journalism school, are: Constantly strive for the truth; Give voice to all sides of a story; When new information comes to light about a story you reported, a correction must be issued or a follow-up produced.But the Canadian media has ignored explosives revelations from the Organization for the Prohibition of Chemical Weapons. It’s a stark example of their complicity with belligerent Canadian foreign policy in Syria.In May 2019 a member of the OPCW Fact Finding Mission in Syria, Ian Henderson, released a document claiming the management of the organization misled the public about the purported chemical attack in Douma in April 2018. It showed that the organization suppressed an assessment that contradicted the claim that a gas cylinder fell from the air. In November another OPCW whistleblower added to the Henderson revelations, saying that his conclusion that the incident was "a non chemical-related event" was twisted to imply the opposite. Last week WikiLeaks released a series of internal documents demonstrating that the team who wrote the OPCW’s report on Douma didn’t go to Syria. One memo noted that 20 OPCW inspectors felt the report released "did not reflect the views of the team members that deployed to [Syria]."  I couldn’t find a single report about the whistleblowers/leaks in any major Canadian media outlet. They also ignored explicit suppression of the leaks.  There is an important Canadian angle to this story. Twenty-four hours after the alleged April 7, 2018, chemical attack foreign affairs minister Chrystia Freeland put out a statement claiming, "it is clear to Canada that chemical weapons were used and that they were used by the Assad regime." Five days later Prime Minister Justin Trudeau supported cruise missile strikes on a Syrian military base stating, "Canada supports the decision by the United States, the United Kingdom, and France to take action to degrade the Assad regime’s ability to launch chemical weapons attacks against its own people." Canadian officials have pushed for the organization to blame Bashar al-Assad’s government for chemical attacks since Syria joined the OPCW and had its declared chemical weapon stockpile destroyed in 2013–14. Canada’s special envoy to the OPCW, Sabine Nolke, has repeatedly accused Assad’s forces of employing chemical weapons. Instead of expressing concern over political manipulation of evidence, Nolke criticized the leak. In a statement after Henderson’s position was made public she noted, "Canada remains steadfast in its confidence in the professionalism and integrity of the FFM [Fact-Finding Mission] and its methods. However, Mr. Chair, we are unsettled with the leak of official confidential documents from the Technical Secretariat."

Trump warns Syria, Russia, Iran not to kill civilians in Idlib province - President Trump on Thursday urged Russia, Syria and Iran not to kill civilians in Syria’s Idlib province and said Turkey is “working hard” to stop “carnage” there. “Russia, Syria, and Iran are killing, or on their way to killing, thousands of innocent civilians in Idlib Province,” Trump, who is currently at his Mar-a-Lago club in Palm Beach, Fla., tweeted. “Don’t do it! Turkey is working hard to stop this carnage.” In recent weeks, Syrian and Russian forces have stepped up air strikes against targets in Idlib province, the last major rebel-held area in the region. A Syrian relief group called the Syrian Response Coordination Group said this week that over 200,000 civilians had fled their homes in northwest Syria amid a bombardment from Syrian government forces there, according to The Associated Press, with many of them fleeing to the Turkish border. The group said that more than 250 civilians have been killed as a result of the air and ground operations conducted by Syria and its Russian and Iranian allies. Turkish President Recep Tayyip Erdoğan warned earlier this week that Turkey could not handle the new wave of refugees coming from Syria. "If the violence towards the people of Idlib does not stop, this number will increase even more. In that case, Turkey will not carry such a migrant burden on its own,” Erdoğan said. Trump sent the tweet Thursday morning amid complaints about his impeachment; shortly later, he departed for Trump International Golf Club.

Tens of thousands flee Syria's Idlib as deadly bombings intensify - Tens of thousands of civilians have fled Syria's Idlib province to the Turkish border, after an increase in bombings by Russia-backed government forces, creating a new humanitarian challenge as the winter season arrives. United Nations observers said on Friday that at least 18,000 people have been displaced in Idlib in just 24 hours, as the deadly bombardments continue. On Friday morning, at least seven more people were reported killed, after at least 19 civilians were killed on Thursday. In the last five days, at least 80,000 Syrians have already fled near Turkey's border, according to reports quoting Syria's Response Coordination Group. Thousands flee as Assad prepares to recapture Idlib (2:35) There are already about one million Syrian refugees living near the border with Turkey. In September 2018, Turkey and Russia had agreed to turn Idlib into a de-escalation zone. Since then, more than 1,300 civilians have been killed in attacks by the Syrian government forces in the de-escalation zone, according to reports. Al Jazeera's Mohammed Adow, reporting from Istanbul, said the Russian-backed Syrian government bombings include air raids, shelling and barrel bomb attacks in the town of Maarat el-Numan in southern Idlib. Syrians living in the area said the attacks were indiscriminate with hospitals, markets and homes targeted. On Friday, public anger against the offensive spilled onto the streets, with hundreds of people in Idlib taking to the streets to denounce what they called the neglect of their plight by the International community. They also called for a swift halt to the bombardment. Witnesses also said that evacuees were targeted as they tried to flee their homes.

80,000 Syrian migrants marching to Turkey, says Erdoğan - More than 80,000 migrants from Syria's Idlib have started to migrate toward the Turkish border, President Recep Tayyip Erdoğan said Dec. 22. "In such a case, Turkey will not bear all alone the burden of this migration," Erdoğan said, speaking at an event in Dolmabahçe0 Palace in Istanbul. Erdoğan said that Turkey along with Russia is making all-out efforts to end the attacks in Idlib. In this regard, he said, Ankara will send a delegation for discussions to Moscow on Dec. 23. "We will determine the steps we will take according to the results," he added. In September 2018, Turkey and Russia agreed to turn Idlib into a de-escalation zone in which acts of aggression are expressly prohibited. Since then, more than 1,300 civilians have been killed in attacks by the regime and Russian forces in the de-escalation zone as the cease-fire continues to be violated. If aggression by the regime and its allies continues, Turkey and the Europe face the risk of another refugee influx. Over a million Syrians have moved near the Turkish border following intense attacks. Since the eruption of the bloody civil war in Syria in 2011, Turkey has taken in over 3.6 million Syrians who fled their country, making Turkey the world's top refugee-hosting country.

Turkey Can't Handle New Refugee Explosion & Greece Will Be First To Feel Impact- Erdogan -At a moment Erdogan has his hands dirty in Syria and is preparing to get more militarily involved in Libya, Turkey's president has yet again threatened Europe with a refugee horde so large no country will be able to handle it. He's now specifically threatened Greece as being among the first to bear the brunt of the first waves of refugees unleashed by Turkey.His threats are now centering on the major uptick in airstrikes by Russia and Syria on Idlib province, said to number in the "hundreds" since a new operation began on Dec.16. Since then, tens of thousands of civilians living under al-Qaeda's Hayat Tahrir al-Sham (HTS) have reportedly fled. "Turkey cannot handle a fresh wave of migrants from Syria, President Tayyip Erdogan said on Sunday, warning that European countries will feel the impact of such an influx if violence in Syria’s northwest is not stopped," Reuters reports. Common estimates now put the number of Syrian refugees hosted on Turkish soil at 3.7 million, with another 3 million inside war-torn Idlib province, which means the refugee crisis is set to explode dramatically higher in terms of numbers a likely scenario given Damascus has vowed to return "every inch" of Idlib and all Syrian territory to its control.Thus far thousands have fled into neighboring Turkey, but there's been on the ground reports suggesting HTS militants are blocking the bulk of refugees from leaving, perhaps using them as 'human shields' amid the Russian-Syrian onslaught.During a public speech in Istanbul on Sunday night, Erdogan claimed over 80,000 people were currently fleeing Idlib for the safety of Turkey, and repeated his urgent appeal for Europe to give additional support.  “If the violence toward the people of Idlib does not stop, this number will increase even more. In that case, Turkey will not carry such a migrant burden on its own,” Erdogan said. And he named Greece while invoking the peak of the migrant crisis in 2015, promising a "repeat" if nothing is done:“The negative impact of the pressure we will be subjected to will be something that all European nations, especially Greece, will also feel,” he said, adding that a repeat of the 2015 migrant crisis would become inevitable.“We call on European countries to use their energy to stop the massacre in Idlib, rather than trying to corner Turkey for the legitimate steps it took in Syria,” Erdogan said, referencing the Turkish army's own ongoing 'Operation Peace Spring' against US-backed Syrian Kurds.Erdogan further called the some $3 billion in support offered by the United Nations refugee agency last w eek "not enough".

Erdogan vows to send Turkish troops into Libya - President Recep Tayyip Erdogan announced Thursday that Ankara will deploy Turkish troops to Libya, claiming that the Tripoli-based Government of National Accord (GNA) has requested military support. The dispatch of Turkish military units to the war-torn north African country threatens to exacerbate an increasingly complex and escalating tensions between Ankara, Moscow and Washington. The GNA, headed by Prime Minister Fayez al-Sarraj, is under siege by General Khalifa Haftar’s so-called Libyan National Army, which is linked to a rival government based in the eastern Libyan port city of Tobruk. Turkey and the GNA signed agreements last month covering military assistance and a delineation of maritime boundaries that the Erdogan government is invoking to lay exclusive claim to vast gas and oil reserves under the eastern Mediterranean. “Since there is an invitation [from Libya] right now, we will accept it,” Erdogan said at a meeting of his ruling Justice and Development Party (AKP). “Based on our memorandum of understanding on the security and military cooperation, we will submit a motion for the deployment of the troops to parliament as the first item after it re-opens.” The “invitation” from Libya had yet to be made public as Erdogan promised that the Turkish troop deployment would be approved by the time the Turkish parliament returns on January 8. The plan to send Turkish troops into Libya threatens to escalate a conflict that has far-reaching implications. While the GNA is recognized as Libya’s “legitimate” government by the United Nations, it controls little territory outside of the capital of Tripoli, which is now under siege. It is dependent upon a collection of Islamist and regional militias for its defense. Haftar, a former general under the Libyan government of Muammar Gaddafi, who defected to the US and became a longtime “asset” of the Central Intelligence Agency, has the backing of Egypt, Saudi Arabia, the United Arab Emirates, Russia and France. And, while Washington is formally backing the GNA, US President Donald Trump praised Haftar last April for his “significant role in fighting terrorism and securing Libya’s oil resources.”

Former IDF intelligence personnel likely tied to UAE spy app, report says - Times of Israel - Former Israeli military intelligence personnel are likely tied to an Emirati messaging app that was secretly spying on its users in a mass surveillance campaign, according to a Sunday report. The United Arab Emirates government uses the ToTok service to monitor users’ location, conversations, relationships and other information, the New York Times reported, citing its own investigation into the app and American officials with knowledge of a classified US intelligence report.ToTok has been downloaded by millions of users through the Apple and Google app stores since it debuted several months ago. Most users are in the UAE, but it has been downloaded by people worldwide, and this month was one of the top social apps in the US, according to the App Annie research firm. The app, which is separate from, but apparently named after the popular Chinese TikTok app, also ranked highly in Saudi Arabia, the UK, India and Sweden.State-backed publications started advertising ToTok in the UAE in recent months as a “free, fast and secure” messaging tool, in a country where many messaging apps are restricted by the government.Both Google and Apple have removed the app from their stores, but users who have downloaded it already are still able to use it. It is the latest in a string of digital weapons that wealthy governments have developed to spy on their adversaries and citizens.

Israel set to be investigated for war crimes in Palestinian Territories, ICC announces - A full investigation into alleged war crimes in the Palestinian Territories is to be launched by the International Criminal Court’s chief prosecutor, prompting a fierce backlash from Israel. Fatou Bensouda said the probe could result in charges against both Israelis and Palestinians. “I am satisfied that ... war crimes have been or are being committed in the West Bank, including East Jerusalem, and the Gaza Strip,” she said in a statement on Friday. Bensouda added that because the Palestinian Territories had requested the intervention of the court she did not need to request approval from judges to start an investigation. However, she has asked the ICC’s pre-trial chamber to rule on what geographical location it can investigate. The probe will be launched pending a decision on geographical jurisdiction. Furious, Israel’s prime minister Benjamin Netanyahu lashed back, claiming the “court has no jurisdiction”. Israel is not a member of the court. “This is a dark day for truth and justice. It is a baseless and outrageous decision,” he said.

Netanyahu calls ICC war crimes probe anti-Semitic - Israeli Prime Minister Benjamin Netanyahu claimed Sunday that efforts by the International Criminal Court (ICC) to investigate alleged war crimes committed by Israeli forces in Palestinian-controlled areas were rooted in anti-Semitism. Reuters reported that the Israeli leader made the accusation at a Hannukah ceremony in Jerusalem in front of the Western Wall, a holy site for Judaism, and claimed that the ICC was opposing the right of Israel to exist as a Jewish state. “New edicts are being cast against the Jewish people - anti-Semitic edicts by the International Criminal Court telling us that we, the Jews standing here next to this wall ... in this city, in this country, have no right to live here and that by doing so, we are committing a war crime,” he said, according to the news service. “Pure anti-Semitism,” he added of the ICC's efforts. His remark comes a day after the ICC's chief prosecutor announced that she wished to open a war crimes investigation into Israeli actions taken in the West Bank, Gaza Strip, and east Jerusalem. The investigation stems from a case brought to the body by Palestinian officials in 2015. "[T]here are no substantial reasons to believe that an investigation would not serve the interests of justice," Fatou Bensouda said Saturday, according to the BBC. Netanyahu, an ally of President Trump, is facing charges of corruption from Israeli law enforcement officials and is currently seeking re-election after a previous election ended with no clear victor earlier this year.

Islamic State Films Gruesome Beheadings In Message To Christians All Over The World -- The Islamic State has released a video which purportedly shows the brutal execution of 11 blindfolded Christians in Nigeria, the day after Christmas, in revenge for the killing of ISIS leader Abu Bakr al-Baghdadi and IS spokesman Abdul-Hasan al-Muhajir, accordign to Ahmad Salkida - a journalist who was first sent the video.   "This is a message to Christians all over the world," says a masked man from the Islamic State West African Province (ISWAP), in the 56-second clip released the Amaq news agency, a platform for Islamic State propaganda.  "We killed them as revenge for the killing of our leaders, including Abu Bakr al-Baghdadi and [IS spokesman] Abul-Hasan al-Muhajir."  The footage, filmed in an unidentified outdoor area, shows one captive who is shot dead while the other 10 are pushed to the ground and beheaded, according to the BBC.  Here is a clip of the video which cuts off before the reported executions. GRAPHIC CLIP: 11 Nigerian male Christians including soldiers, Aid workers & civilians abducted by Islamic State Wilayat Gharb Ifriqiyah #ISWAP were on Christmas day Beheaded excluding one who was shot execution style. N.B (Edited Video only posted for research, Intel purposes) — Edward (@DonKlericuzio) December 26, 2019 ISWAP, which severed ties with insurgent group Boko Haram and pledged allegiance to Baghdadi in 2016, has intensified its attacks on Christians, security personnel and aid staff in recent months - incuding the use of checkpoints to stop and search travelers.  On Tuesday, the United Nations condemned the "increasing practice by armed groups to set up checkpoints targeting civilians" in Nigeria's northeast region amid the increase in targeted violence.  On Sunday, the jihadists killed six people and abducted five others including two aid workers when they intercepted vehicles on a highway on the outskirts of Maiduguri, the Borno state capital. In a similar attack on December 5, ISWAP fighters disguised as Nigerian soldiers stopped and searched vehicles at a checkpoint near Maiduguri.  The group claimed in a statement that six soldiers and eight civilians, including two Red Cross workers, were among those abducted in that attack. Last week the group released a video showing 11 alleged hostages. –MSN