Sunday, November 17, 2019

US oil output at a record high, oil rigs at a 31 month low; global oil shortage at 1.6 million barrels per day despite a 1.7 mbpd supply increase

oil prices ended a bit higher this week, after seesawing on conflicting China-US trade deal and crude inventory reports...after rising $1.04, or 1.9% to $57.24 a barrel last week on repeated rumors that a US-China trade deal was imminent, prices of US light sweet crude for December delivery fell early on Monday after Trump denied reports from last week that the two sides had agreed to roll back existing tariffs on each others’ goods and finished the day 38 cents lower at $56.86 a barrel, as lack of progress in U.S.-China trade negotiations pressured prices, even as bullish Cushing inventory data offered some support...prices climbed more than 1% early on Tuesday amid hopes that a Trump speech later in the day would indicate progress on the trade war, but pared those gains following a Trump speech that offered few new details and ended 6 cents lower at $56.80 a barrel...oil prices then edged up on Wednesday after an OPEC report and comments from Fed Chair Jerome Powell both forecast a robust economy going forward, and extended those gains when the API reported a surprise draw from US crude supplies to finish the day 32 cents higher at $57.12 a barrel....however, those gains were reversed on Thursday when the EIA reported a larger than expected build of domestic oil inventories and record crude production, as oil prices fell 35 cents, or 0.6%, to settle at $56.77 a barrel....but despite those concerns about rising crude supplies oil prices rallied on Friday after Commerce Secretary Ross said trade talks with China were down to the last details and after Baker Hughes reported the fourth straight weekly decline in the number of US rigs drilling for oil and went on to finish 95 cents, or 1.7 percent, higher to close at $57.72 per barrel, a two month high...oil prices thus ended the week with a gain of 48 cents, or 0.8%, even as competing and conflicting signals kept the market prices volatile...

natural gas prices, on the other hand, finished lower for the first time in 3 weeks, as temperature forecasts moderated in the face of record natural gas production...after rising 2.8% to $2.789 per mmBTU last week amid warnings of a historically severe outbreak of cold across the eastern US, the price of natural gas for December delivery gapped down over the weekend and opened 7.3 cent lower on Monday on a major change in the temperature output and a report of record gas well production, and then continued falling throughout the day to end down 15.2 cents at 2.637 per mmBTU...prices drifted 1.6 cents lower on Tuesday and 2.1 cents lower on Wednesday even as the heating demand forecast moved higher over the period and didn't turn higher until the natural gas storage report indicated a smaller addition to storage than natural gas traders had expected...that bullish storage report pushed prices up 4.8 cents on Thursday and another 4.1 cents on Friday to end the week at $2.688 per mmBTU, which was still down 3.6% from where it had ended the prior week..

the natural gas storage report for the week ending November 8th from the EIA indicated that the quantity of natural gas held in storage in the US increased by 3 billion cubic feet to 3,732 billion cubic feet by the end of the week, which meant our gas supplies were 491 billion cubic feet, or 15.1% more than the 3,199 billion cubic feet that were in storage on November 8th of last year, and 2 billion cubic feet, or less than 0.1% above the five-year average of 3,730 billion cubic feet of natural gas that have been in storage as of the 8th of November in recent years....we thus start the official heating season with natural gas supplies 3.1% above the average seasonal normal in the East, 1.9% above normal in the Midwest, 0.3% below normal in the South Central region, 2.8% below normal in the Mountain region, and 11.6% below normal in the Pacific region...

while we had expected this report to show a gas withdrawal, the 3 billion cubic feet injection into US natural gas storage this week was 4 billion cubic feet less than the average forecast for a 7 billion cubic feet injection from analysts surveyed by S&P Global Platts, and well below the average 30 billion cubic feet of natural gas that have been added to gas storage after the first week of November over the past 5 years, the 2nd below average storage build in a row but only the 4th below average increase over the past 35 weeks...the 2,572 billion cubic feet of natural gas that have been added to storage over this year's injection season were still near a modern record, eclipsed only by the record 2767 billion cubic feet of natural gas that were injected into storage during the 2014 natural gas injection season...

The Latest US Oil Supply and Disposition Data from the EIA

US oil data from the US Energy Information Administration for the week ending November 8th showed that because our oil production rose to a record level, we managed to have a surplus of oil to add to our stored supplies for the eighth time in the past nine weeks...our imports of crude oil fell by an average of 327,000 barrels per day to an average of 5,750,000 barrels per day, after falling by an average of 620,000 barrels per day during the prior week, while our exports of crude oil rose by an average of 262,000 barrels per day to an average of 2,633,000 barrels per day during the week, which meant that our effective trade in oil worked out to a net import average of 3,117,000 barrels of per day during the week ending November 1st, 589,000 fewer 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 was reported to be 200,000 barrels per day higher at a record 12,800,000 barrels per day, so our daily supply of oil from the net of our trade in oil and from well production totaled an average of 15,917,000 barrels per day during this reporting week..

meanwhile, US oil refineries were reportedly processing 15,916,000 barrels of crude per day during the week ending November 8th, 154,000 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 111,000 barrels of oil per day were being added to 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 and from oilfield production was 109,000 barrels per day less than what was reportedly added to storage plus 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 (+109,000) 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"....(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 fell to an average of 6,095,000 barrels per day last week, now 18.8% less than the 7,503,000 barrel per day average that we were importing over the same four-week period last year....the 111,000 barrel per day net addition to our total crude inventories was despite a withdrawal of 206,000 barrels per day from our Strategic Petroleum Reserve, which means that a total of 317,000 barrels per day were being added to our commercially available stocks of crude oil....this week's crude oil production was reported to be 200,000 barrels per day higher at a record 12,800,000 barrels per day because the rounded estimate of the output from wells in the lower 48 states rose by 200,000 barrels per day to a record 12,300,000 barrels per day, while a 8,000 barrel per day increase to 491,000 barrels per day in Alaska's oil production was not enough to impact the final rounded total...last year's US crude oil production for the week ending November 9th was rounded to 11,700,000 barrels per day, so this reporting week's rounded oil production figure was 9.4% above that of a year ago, and 51.9% 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...   

with the weekly data now showing our estimated weekly oil production is at a record high, we'll include a graph of what that production looks like compared to its recent history and to the EIA's confirmed oil production totals...

November 16 2019 US crude production to November 8

the above graph was taken from this week's OilPrice Intelligence Report, and it shows the history of confirmed oil production data monthly from January 2016 to August 2019 in blue, and then the weekly estimates of US oil production up until the current week in yellow after that period, with both metrics in thousands of barrels per day...above the graph, OilPrice also gives us the rounded weekly estimates of oil production in thousands of barrels per day for the weeks ending October 4th through November 8th, as was reported by the you see, those weekly production estimates had been stuck at 12,600,000 barrels per day for 5 weeks, as apparently the EIA did not get any new information to justify increasing their estimate...however, on the Thursday before last, the EIA released their confirmed monthly data for August, which showed that US oil production had risen to 12,365,000 barrels per day, up from 11,766,000 barrels per day in July...that increase strongly suggested to the EIA that their currently weekly estimates for November had been too low, so they increased that estimate this week...however, despite the fact that the prior weekly totals were more than likely higher than 12,600,000 barrels per day, the EIA will not change their earlier inaccurate weekly estimates to reflect that....nonetheless, we still follow this less than accurate weekly data because it's what the oil traders follow, and hence it moves oil prices and ultimately the decisions on the part of exploitation companies to start drilling for oil...

meanwhile, US oil refineries were operating at 87.8% of their capacity in using 15,916,000 barrels of crude per day during the week ending November 8th, up from 86.0% of capacity the prior week, but still below normal for early a result, the 15,916,000 barrels per day of oil that were refined this week was 3.1% below the 16,432,000 barrels of crude per day that were being processed during the week ending November 9th, 2018, when US refineries were operating at 90.1% of capacity....

with the increase in the amount of oil being refined, gasoline output from our refineries was also higher, increasing by 137,000 barrels per day to 10,173,000 barrels per day during the week ending November 8th, after our refineries' gasoline output had decreased by 148,000 barrels per day the prior week....with this week's increase in gasoline output, our gasoline production was 1.2% higher than the 10,056,000 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 164,000 barrels per day to 5,039,000 barrels per day, after our distillates output had decreased by 95,000 barrels per day over the prior week...with this week's increase in distillates output, our distillates' production for the week was 0.9% above the 4,993,000 barrels of distillates per day that were being produced during the week ending November 9th, 2018....

with the increase in our gasoline production, our supply of gasoline in storage at the end of the week increased for the 1st time in seven weeks and for the 7th time in 21 weeks, rising by 1,861,000 barrels to 217,229,000 barrels during the week to November 8th, after our gasoline supplies had decreased by 2,828,000 barrels over the prior week....our gasoline supplies finally increased this week because our imports of gasoline rose by 186,000 barrels per day to 679,000 barrels per day and because our exports of gasoline fell by 195,000 barrels per day to 814,000 barrels per day, while the amount of gasoline supplied to US markets increased by 176,000 barrels per day to 9,321,000 barrels per day....after this week's increase, our gasoline supplies were 4.7% lower than last November 9th's inventory level of 228,021,000 barrels, but remained roughly 1% above the five year average of our gasoline supplies for this time of the year...

however, even with the increase in our distillates production, our supplies of distillate fuels fell for the 23rd time in the past 33 weeks, decreasing by 2,477,000 barrels to 116,655,000 barrels during the week ending November 8th, after our distillates supplies had decreased by 622,000 barrels over the prior week...our distillates supplies fell by more this week than last because the amount of distillates supplied to US markets, an indicator of our domestic demand, increased by 238,000 barrels per day to 4,534,000 barrels per day, and because our imports of distillates fell by 70,000 barrels per day to 236,000 barrels per day and because our exports of distillates rose by 121,000 barrels per day to 1,095,000 barrels per day...after this week's inventory decrease, our distillate supplies were down by 2.2% from the 119,268,000 barrels of distillates that we had stored on November 9th, 2018, and fell back to around 10% below the five year average of distillates stocks for this time of the year​...

finally, ​despite ​this week's drop in oil ​imports​ ​​and the increase in refinery throughput​, our record oil production ​meant our commercial supplies of crude oil in storage rose for the tenth time in twenty-two weeks and for the​ twenty-fifth​ time in 42 weeks, increasing by 2,219,000 barrels, from 446,782,000 barrels on November 1st to 449,001,000 barrels on November 8th...that increase meant our crude oil inventories were 2% above the five-year average of crude oil supplies for this time of year, and roughly 32% higher than the prior 5 year (2009 - 2013) average of crude oil stocks after a full week of November, with the disparity between those comparisons arising because it wasn't until early 2015 that our oil inventories first rose above 400 million barrels...since our crude oil inventories had generally been rising over the year up until July, after generally falling until then through most of the prior year and a half, our oil supplies as of November 8th were 1.6% above the 442,057,000 barrels of oil we had stored on November 9th of 2018, but at the same time were 2.2% below the 458,997,000 barrels of oil that we had in storage on November 10th of 2017, and 8.4% below the 490,284,010,000 barrels of oil we had in commercial storage on November 11th of 2016...   

OPEC's Monthly Oil Market Report

Thursday of this past week saw the release of OPEC's November Oil Market Report, which covers October OPEC & global oil data, and hence ​it ​shows a big rebound in Saudi production as it recovered from the September 14th drone attack on their oil infrastructure...but even with that ​bounce in Saudi output, and a big jump in non-OPEC production, this report still shows there was again a large shortfall in the amount of oil produced globally in October, albeit less than half of the large shortfall seen in September...

the first table from this monthly report that we'll look at is from the page numbered 60 of that report (pdf page 70), and it shows oil production in thousands of barrels per day for each of the current OPEC members over the recent years, quarters and months, as the column headings indicate...for all their official production measurements, OPEC uses an average of estimates from six "secondary sources", namely the International Energy Agency (IEA), the oil-pricing agencies Platts and Argus, ‎the U.S. Energy Information Administration (EIA), the oil consultancy Cambridge Energy Research Associates (CERA) and the industry newsletter Petroleum Intelligence Weekly, as a means of impartially adjudicating whether their output quotas and production cuts are being met, to thus avert any potential disputes that could arise if each member reported their own figures...

October 2019 OPEC crude output via secondary sources

as we can see from the above table of oil production data, OPEC's oil output jumped by 943,000 barrels per day to 29,650,000 barrels per day in October, from their revised September production total of 28,707,000 barrels per day...however that September output figure was originally reported as 28,491,000 barrels per day, which means that September's production was revised 216,000 barrels per day higher​,​ and hence October's production was, in effect, a 1,159,000 barrel per day increase from the previously reported ​OPEC ​production figures (for your reference, here is the table of the official September OPEC output figures as reported a month ago, before this month's revisions)...

we can also see that the 1,094,000 barrel per day increase in production by the Saudis, largely a rebound after the September attack on their facilities, was the reason for OPEC's September output jump, as decreases of 100,000 barrels per day in output from Ecuador, of 43,000 barrels per day in output from Angola, of 42,000 barrels per day in output from Iraq, and of 37,000 barrels per day in the output from Nigeria were only partially offset by the 42,000 barrel per day increase in output from Venezuela and the 23,000 barrel per day increase from the Emirates, while the oil output from most other OPEC members was comparatively little changed....

even with the jump in Saudi output, their production​,​ and production from most other OPEC members other than Iraq and Nigeria, remains below the output allocation as originally determined for each OPEC member after their December 7th, 2018 meeting, when OPEC agreed to cut 800,000 barrels per day as part of a 1.2 million barrel per day cut agreed to with Russia and other oil producers, and which were extended at their July 1st meeting a little over four months ago...this can be seen in the table of OPEC production allocations we've included below:

February 6 2019 Platts on OPEC allocations

the above table came from a February 6th post on Saudi cuts and OPEC allocations at S&P Global Platts, and it shows average daily production quota in millions of barrels of oil per day for each of the OPEC members as was agreed to at their December 2018 meeting and has ​since been extended through March 2020 as of their ​June meeting....note that Venezuela and Iran, whose oil exports are being sanctioned by the Trump administration, and Libya, which has been beset by a civil war, are exempt from any production quotas, and that only Libya among those exempt countries is producing more than they did in the 1st quarter of this year, which you can see in the third column of the first, official OPEC production table above...note that a month ago there ​were media reports that OPEC had agreed to raise the quota for Nigeria to 1.774 million barrels per day, but there was no official policy statement to that effect...

the next graphic from the report that we'll include shows us both OPEC and world oil production monthly on the same graph, over the period from November 2017 to October 2019, and it comes from page 61 (pdf page 71) of the November OPEC Monthly Oil Market Report....on this graph, the cerulean blue bars represent OPEC oil production in millions of barrels per day as shown on the left scale, while the purple graph represents global oil production in millions of barrels per day, with the metrics for global output shown on the right scale...  

October 2019 OPEC report global oil supply

including the 943,000 barrel per day increase in their production from what they produced a month ago, OPEC's​ ​preliminary estimate now indicates that total global oil production increased by 1.67 million barrels per day to 99.34 million barrels per day in October, and that reported increase came after September's total global output figure was revised up by 350,000 barrels per day from the 97.32 million barrels per day of global oil output that was reported a month ago, as non-OPEC oil production rose by a rounded 730,000 barrels per day in October after that revision, with higher oil production from ​the ​US, Canada, Norway, the UK, Australia, Kazakhstan, and China the major reasons for the non-OPEC output increase in October...despite that jump in October's output, the 99.34 million barrels of oil ​per day produced globally in October were still 0.80 million barrels per day, or 0.8% lower than the revised 100.14 million barrels of oil per day that were being produced globally in October a year ago (see the November 2018 OPEC report (online pdf) for the originally reported October 2018 details)...with this month's increase in OPEC's output, their October oil production of 29,650,000 barrels per day rose to 29.8% of what was produced globally during the month, up from the 29.3% share they contributed in September....OPEC's October 2018 production was reported at 32,900,000 barrels per day, which means that the 13 OPEC members who were part of OPEC last year, excluding Qatar from last year's total and new member Congo from this year's, produced 2,966,000 fewer barrels per day of oil than​ what​ they produced a year ago, when they accounted for 33.0% of global output, with a 1,150,000 barrel per day ​drop ​in the output from Iran, a 740,000 barrel per day decrease in output from Saudi Arabia, and a 448,000 barrel per day decrease in the output from Venezuela from that time more than offsetting the small year over year production increases of 60,000 barrels per day by Nigeria, 53,000 barrels per day by Libya, 54,000 barrels per day by the United Arab Emirates and 37,000 barrels per day by Iraq... 

even with the 1,670,000 barrels per day increase in global oil output that was seen during October, there was a substantial shortfall in the amount of oil being produced globally during the month, as this next table from the OPEC report will show us...     

October 2019 OPEC report global oil demand

the table above came from page 34 of the November OPEC Monthly Oil Market Report (pdf page 44), and it shows regional and total oil demand in millions of barrels per day for 2018 in the first column, and OPEC's estimate of oil demand by region and globally quarterly over 2019 over the rest of the table...on the "Total world" line in the fifth column, we've circled in blue the figure that's relevant for October, which is their revised estimate of global oil demand during the fourth quarter of 2019...

OPEC has estimated that during the 4th quarter of this year, all oil consuming regions of the globe will be using 100.95 million barrels of oil per day, which was revised from their estimate of 100.89 million barrels of oil per day for the 4th quarter a month ago....meanwhile, as OPEC showed us in the oil supply section of this report and the summary supply graph above, OPEC and the rest of the world's oil producers were only producing 99.34 million barrels per day during October, which means that there was a shortage of around 1,610,000 barrels per day in global oil production when compared to the demand estimated for the month... 

meanwhile, the upward revision of 350,000 barrels per day to September's global output that's implied in this report means that the 3,380,000 barrel per day shortfall that we had originally figured for September based on last month's figures would now have to be revised to a deficit of 3,030,000 barrels per day...but since data for July and August was unrevised, July's shortfall would be unchanged at a deficit of 2,290,000 barrels per day, and August's shortfall would remain at a deficit of 1,670,000 barrels per day....hence the 3rd quarter​'s​ ​oil shortage averaged 2,330,000 barrels per day...

however, demand figures for both the first quarter and 2nd quarter were revised with this report, as you can see encircled by the green ellipse on the table above...the 160,000 barrels per day downward revision to 2nd quarter demand would mean that we'd have to revise our global oil deficit for June from 470,000 barrels per day to 310,000, that we'd have to revise our May deficit from 840,000 barrels per day to 680,000 barrels per day, and that we'd have to revise our global oil deficit for April from 860,000 barrels per day to 710,000 barrels per day...hence, for the 2nd quarter as a whole, even after those downward revision to demand, the world's oil producers were still producing 457,000 barrels per day less than what was needed...

also encircled in green is an upward revision of 100,000 barrels per day to first quarter demand, a period when​ oil​ suppl​ies exceeded demand....that revision means that the global oil surplus of 290,000 barrels per day we had last figured for March would have to be revised to a global oil surplus of 190,000 barrels per day...similarly, the 740,000 barrel per day global oil output surplus we had for February would now be a 640,000 barrel per day global oil output surplus, and the 650,000 barrel per day global oil output surplus we had for January would be revised to a 550,000 barrel per day oil output surplus..

so as you can see, we have gone from a global oil surplus averaging over 450,000 barrels per day in the first quarter to an oil shortage of 2,330,000 barrels per day by the third quarter, and thence to an oil shortage of around 1,610,000 barrels per day in October....however, most of the media, including industry websites, are still reporting on supplies as if we still have a global glut of oil, because that has become the established narrative and becaus​e ​no one makes the effort to look at the actual data...... 

This Week's Rig Count

the US rig count fell for the 12th time in 13 weeks and for the 35th time in 39 weeks over the week ending November 15th, and is now down by 25.6% since the end of last year....Baker Hughes reported that the total count of rotary rigs running in the US fell by 11 rigs to a 32 month low of 806 rigs this past week, which was also down by 276 rigs from the 1082 rigs that were in use as of the November 16th report of 2018, and 1123 fewer rigs than the shale era high of 1929 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 10 to a 31 month low of 674 oil rigs this week, which was also 214 fewer oil rigs than were running a year ago, and quite a bit below the recent high of 1609 rigs that were drilling for oil on October 10th, the same time, the number of drilling rigs targeting natural gas bearing formations fell by 1 rig to a 34 month low of 129 natural gas rigs, down by 65 rigs from the 194 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 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 was unchanged at 22 rigs this week, with all of those drilling offshore from Louisiana...that's now equal to the the Gulf of Mexico rig count of 22 a year ago, when 20 rigs were drilling in Louisiana waters and two were drilling offshore from Texas...meanwhile, the rig that had been drilling offshore from the Kenai Peninsula in Alaska was shut down this week, so the Gulf of Mexico count is now equal to the national count, and equal to the 22 rigs that were deployed offshore a year ago...however, the last platform that had been set up to drill through an inland body of water in southern Louisiana was shut down this week, and with none of those left nationally, is down from the "inland waters' count of two ​rigs ​a year ago...

the count of active horizontal drilling rigs was down by 8 rigs to 702 horizontal rigs this week, which was the least horizontal rigs deployed since April 7th, 2017 and hence is a new 31 month low for horizontal drilling...that was also 237 fewer horizontal rigs than the 939 horizontal rigs that were in use in the US on November 16th 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 decreased by 1 to 50 vertical rigs this week, and those were down by 22 from the 72 vertical rigs that were operating during the same week of last the same time, the directional rig count decreased by 2 rigs to 54 directional rigs this week, and those were down by 17 from the 71 directional rigs that were in use on November 16th 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 November 15th, the second column shows the change in the number of working rigs between last week's count (November 8th) and this week's (November 15th) count, the third column shows last week's November 8th 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 16th of November, 2018...  

November 15 2019 rig count summary

in the Permian basin of western Texas and New Mexico, 6 rigs were pulled out of Texas Oil District 8, or the core Permian Delaware, while the rig counts in Texas Oil District 7C, or the southern Permian Midland and in Texas Oil District 8A, or the northern Permian Midland, were unchanged...that suggests that a rig added in Texas Oil District 7B, east of the Permian Midland on most maps, had been in fact a rig​ targeting the Permian, while the rig added in New Mexico was placed in the far western reaches of the Permian the same time, ​however, ​drilling activity in all other Texas districts & basins remained unchanged...meanwhile, even though Oklahoma rigs were shut down in the Cana Woodford and in the Ardmore Woodford, the state still shows a one rig increase, which means 3 rigs were added in Oklahoma basins not tracked by Baker Hughes...conversely, while just one rig was pulled out of the Denver-Julesburg Niobrara, Colorado saw a one rig decrease while Wyoming was down 2 rigs, meaning 2 of the rigs pulled from those states had also been running in basins not tracked by Baker Hughes...all those aforementioned rig changes, plus the one rig pulled out of North Dakota's Williston basin, had been targeting oil​, while all of the natural gas rig changes this week were in the Appalachian basins, where 3 rigs were pulled out of the Marcellus, two in West Virginia and one from Pennsylvania, while two rigs were added in Ohio's Utica..


NB: the following is an excerpt from an email i sent to a few environmental journalists this week, ​and included here as i ​believe it ​should be of general interest:

​...​in the Permian basin of west Texas, they are now burning off or venting 752 million cubic feet of natural gas per day, which i figure to be 10 times more natural gas than what West Virginia's households consume over a year  (here's the annual data on WVa's consumption, divide by 365 to get their daily use; burned gas all goes into the atmosphere as CO2, while what's vented is released as methane, which i'm sure you know is much worse...they're doing this because they're after the oil, and the natural gas that comes up with it is an inexpensive byproduct they don't want...'

Rystad Energy: Permian gas flaring reaches another high | Oil & Gas Journal - Flaring and venting of natural gas in the Permian basin in Texas and New Mexico reached an all-time high in this year’s third quarter, averaging more than 750 MMcfd, according to a preliminary analysis conducted by Rystad Energy.
191105 Rystad Permian Flare Chart

Massive fire erupts after gas line explosion in Pepper Pike - When a gas line exploded early Friday in Pepper Pike, firefighters did not have to go far to battle it. The explosion and fire happened around 1 a.m. across the street from the fire station on Shaker Boulevard. When FOX 8 News crews arrived on scene, massive flames were shooting into the air. Dominion Gas was on scene by 1:30 a.m. They were able to get the gas turned off by around 3:30 a.m. A police officer on the scene told FOX 8 News that crews had working on a gas line in the area. It's unclear if crews were working when the explosion happened. Several nearby residents were evacuated and sent to the community center. FOX 8 spoke to some residents who said they heard an explosion. "I heard a loud noise and all of a sudden my bedroom light up," Patricia Finley said. "I couldn't figure out where it came from. I looked out the window and saw the woods were on fire." "At first I thought it was an earthquake because the house shook, the windows were shaking," she said. Police say power is out to about 500 homes. FirstEnergy is evaluating the outage, but right now it is not known when power will be restored. Roads in the area, including Gates Mills Blvd, east and west, from Lander to Brainard Circle, Shaker Blvd., east and west from Lander Rd. to Richmond Rd., and Brainard Rd. from Fairmount to S. Woodland, north and south were closed due to the fire and damage to roads and power lines.

Dominion Energy says pipeline isolated, shut after fire in Ohio (Reuters) - Dominion Energy Inc said on Friday that one of their pipelines in Pepper Pike, Ohio had been isolated after it exploded, shutting off the flow of gas. “As a precaution, crews are working to confirm the integrity of Dominion Energy mains and service lines in the area and check for potential migration of gas from the incident site,” the company said in an emailed statement. Pepper Pike firefighters isolated the damaged line, shutting off the flow of gas and making the scene safe at about 3:35 a.m., Dominion said. “There is no damage to anyone’s property and there are no injuries. They shut the gas line off to put the fire out,” a fireman from the Pepper Pike fire department said. While there were no injuries reported, the incident damaged the roadway on Shaker Boulevard, electric utility poles, power lines and some trees in the vicinity, Dominion said. The gas line explosion forced the evacuation of several residents and closure of some roads in Pepper Pike, according to several media reports.

New Ohio regulations reduce minimum spacing requirements for horizontal oil and gas wells – Lexology -The Ohio Department of Natural Resources – Division of Oil & Gas Resources Management (DOGRM) recently revised its rules governing spacing of horizontal oil and gas production wells. The new rules, which became effective on Oct. 10, 2019, will bring Ohio’s horizontal well spacing regulations in line with what accepted science and drilling data indicates is a more efficient and productive spacing for horizontal wells in Ohio.Under the prior version of Ohio Administrative Code §1501:9-1-04, which applied to both conventional and horizontal wells, any oil and gas production well drilled into a pool located at least 4,000 feet in depth must be set back at least 500 feet from the boundary of the leased tract or drilling unit. That prior version of the rule also required a spacing of at least 1,000 feet between wells producing from the same pool.  Effective Oct. 10, 2019, Ohio Administrative Code §1501:9-1-04 was revised to require only a 150 foot (+/- 10 percent) setback from the first and last “take points” of a horizontal well and the boundary of the drilling unit or subject tract. This change is consistent with industry practice of seeking a setback variance at the heel and toe of horizontal wells in order to more fully develop a drilling unit. Drilling data shows that well stimulation operations do not typically produce fractures that propagate more than 150 feet beyond the heel and toe of a typical Ohio shale well. Thus, the prior 500 foot setback requirement was excessive and left unproduced resources at the heel and toe of a well. The revised regulations also reduce the required setback between the boundary of the drilling unit and the other take points in the well from 500 feet to 400 feet (+/- 10 percent). Finally, the revised regulations now provide no minimum spacing between horizontal wells within a “subject tract” unless “adverse communication” occurs between the wells and the subject tract. Again, these setback reductions should help achieve more complete production of resources within a drilling unit. It is important to keep in mind that for purposes of these regulations, Ohio Rev. Code §1509.01 defines a “horizontal well” as an oil and gas production well that is drilled in a horizontal configuration in the Point Pleasant, Utica or Marcellus formations, and is stimulated. Consistent with the new rules, Ohio Administrative Code §1501:9-1-01 introduces new terms and definitions. Specifically, “adverse communication” is defined as “negative communication at an offset well that may include damage to production tubing, casing, or the wellhead, or sudden significant increased volume of brine from the subsequent hydraulic fracturing treatment of another well in the same subject tract.” Likewise, the term “take point” has been introduced and defined as “any point along a well bore where oil, gas, or oil and gas may be produced from a pool.”

Marcellus Shale natural gas royalty case moves to state Supreme Court - A four-year legal battle over the calculation of Marcellus Shale natural gas royalty payments is now in the hands of the state Supreme Court.The court on Oct. 30 agreed to decide whether tactics used by gas extractors to obtain leases fall under the Unfair Trade Practices and Consumer Protection Law and if antitrust remedies can be pursued under that statue.In the suit filed in 2015 in Bradford County on behalf of private landowners, then-Attorney General Kathleen G. Kane accused gas extractors of using deceptive, misleading and unfair tactics to obtain leases.She alleged property owners were promised certain amounts in royalties when they signed leases to allow drilling but received lower payments once the wells started producing.The suit followed an investigation sparked by property-owner protests, especially those in Bradford County, over low royalty payments.A farmer reported getting a $1.10 check in 2014 for gas taken from two well pads on his land in the Sayre area.“Nothing has really changed,” said Rex Kingsley who has six wells on his Bradford County properties. “They’re still taking large deductions,” he said.In fighting the suit, Chesapeake Energy Corp., Anadarko Petroleum Corp. and their affiliates claim the Unfair Trade Practices and Consumer Protection Law does not apply to the leases.  But Lycoming County Senior Judge Kenneth D. Brown, specially assigned in Bradford County, ruled it did.

Pennsylvania's gas politics churn as Trump embraces industry (AP) -- For a second time in three months, President Donald Trump is headed to Pennsylvania to promote his support for the natural gas industry, making clear that he sees his pro-industry policies as a boost to his chances of winning the battleground state. As some of his leading Democratic opponents are calling for a fracking ban, Trump has been eager to cut a contrast, touting his support for a sector he says brings economic benefits to rural pockets and jobs to construction union workers. But pipeline politics might not be so clear-cut. In the suburbs that might be key to his path to victory, Pennsylvania voters have shown a growing opposition to the drilling and massive pipelines required to move its product across the state. Candidates in state and local races are increasingly hardening their stances on the industry. National polling shows growing skepticism of fracking, the process used in extraction. While the issue is unlikely to be the one that turns a race already dominated by Trump's strong personality, a looming impeachment fight and accusations of racism, Trump's eagerness to promote the industry underscores his tight focus on shoring up his base of rural voters, even at the risk of alienating others. On Wednesday, Trump will speak to a conference in Pittsburgh, a corporate hub of activity in the Marcellus Shale, the nation's most prolific natural gas reservoir. Going to the Pittsburgh conference gives Trump the ability to pitch to an industry and a region -- western Pennsylvania, eastern Ohio and West Virginia -- that help make up "what some would call his base," said Dave Spigelmyer, president of the Marcellus Shale Coalition, a trade group that's co-sponsoring the event.

Gov. Wolf Disagrees With Mayor Peduto On Fracking Ban -Pennsylvania Governor Tom Wolf is the latest to take exception to Pittsburgh Mayor Bill Peduto's call for no more natural gas cracker plants in the region. The governor told Larry and john Tuesday morning the mayor is wrong on this one. “I do disagree with him on this, I think we need to have the products, the light-weight products that will be part of that energy-sustainable future, they’re coming out of that cracker plant,” said Wolf. The governor said he's opposed to a so-called fracking ban proposed by some Democratic presidential candidates like Elizabeth Warren and Bernie Sanders. Wolf isn’t taking them too seriously. “I think you have to say different things to get the nomination and no one really knows what that means, ban fracking, I’m not even sure if a president can do that.” ___

Pa. Senator Pat Toomey Pressing For Passage Of A Measure That Would Keep Presidents From Banning Fracking – CBS Pittsburgh (AP) – Republican U.S. Sen. Pat Toomey of Pennsylvania is seeking passage of a measure that’s squarely aimed at several Democratic presidential candidates and designed to prevent a president from banning hydraulic fracturing. Toomey said Friday his new resolution makes it clear that Congress believes a president doesn’t have the authority to ban hydraulic fracturing, or fracking. Toomey’s resolution is in response to an all-out prohibition on the controversial natural gas extraction process that’s backed by two leading Democratic presidential candidates, Sens. Bernie Sanders and Elizabeth Warren. The prospect of banning fracking is dividing Democrats and their traditional allies in organized labor in what’s shaping up as a premier battleground state in next year’s presidential election. Pennsylvania is also the nation’s No. 2 natural gas state, behind Texas.

New Ethane Cracker Factories Raise Climate Change And Pollution Concerns -- Plastic is not just a problem for overwhelmed landfills or the marine life that ingest it. Plastic is also a huge contributor to carbon emissions, climate change and toxic pollution. But if some of the large petrochemical companies have their way, plastic production will increase dramatically in the coming years. Cradle to grave, plastic could produce as much as 56 gigatons of carbon dioxide between now and 2050, according to a recent study — 50 times more than all the coal-fired power plants in the United States produce in a year.. Part of the reason plastic is so carbon-intensive is that it is made from fossil fuels. Historically, the building block of plastic was oil, but today it’s increasingly made from ethane, a component of natural gas.Ethane gets vented into the atmosphere primarily at hydraulic fracturing (“fracking”) sites, said Judith Enck, founder of Beyond Plastics and a visiting professor at Bennington College. A number of petrochemical companies, including Shell, Exxon and BP, want to capture this ethane and send it by pipeline to new plastic production factories called ethane crackers. In these factories, ethane is heated to an extremely high temperature, which breaks apart the molecular bonds holding it together (hence, “cracking”), creating ethylene, Enck explains. In this form, it becomes a building block of plastic packaging.“Because fracking has made natural gas so cheap, it’s driving a massive expansion in new infrastructure for plastics and petrochemicals. … Creating new plastics from cracking ethane will also discourage companies from using recycled plastic in their products because the virgin plastic will be cheaper.”“Because fracking has made natural gas so cheap, it’s driving a massive expansion in new infrastructure for plastics and petrochemicals,” Enck said. “Creating new plastics from cracking ethane will also discourage companies from using recycled plastic in their products because the virgin plastic will be cheaper.”Petrochemical companies know that fossil fuel demand for use in electricity generation and transportation will drop in the coming years, so they are “making a big-money bet shifting to plastic production,” Enck said. “They are counting on the world wanting more and cheaper single-use plastic packaging.”These plans run counter to the growing trend in the US and other countries to do away with single-use plastic, including bans on plastic bags and plastic straws.

To crack or not to crack: the regional climate change battle is joined | Pittsburgh Post-Gazette - After Mayor Bill Peduto declared his strong opposition to additional petrochemical facilities like the Royal Dutch Shell ethane cracking plant in Potter, Beaver County, the reaction was swift. He was lauded for displaying climate change courage, lambasted for perceived insults to workers and criticized by political ally Rich Fitzgerald, among others. At the Climate Action Summit in Pittsburgh Oct. 30, Mr. Peduto decried tying the region’s economic future to shale gas development, and was also critical of area’s industrial culture for failing to aggressively combat climate change. While Mr. Peduto’s comments were greeted by cheers at the summit and from environmental organizations, the anguished reaction from some of the region’s political and business leaders made it clear that the old jobs-versus-the-environment debate has ramped up in the face of ever-more-certain scientific predictions of climate catastrophes and the potent but fragile economics of the region’s shale gas operations. Industry, labor, county economic development organizations, the state Chamber of Commerce and elected officials lamented that such negative talk could cost jobs in the petrochemical, shale gas, engineering, legal, geology, hotel-motel and restaurant industries. Allegheny County Executive Rich Fitzgerald, a long-time proponent of natural gas development, was critical of his fellow Democrat and frequent political cohort for his opposition to additional petrochemical development. In an Oct. 31 interview on KDKA radio, Mr. Fitzgerald said the Shell cracker facility, which will turn the region’s shale ethane gas into plastic pellets used to make a variety of plastic products, has created $7 billion of wealth to the region, along with full employment in the building trades. He added that an abundance of shale gas has resulted in a 70% reduction in home heating costs at an average savings of $1,200 per household. “We’re at the beginning of how to capitalize on this,” Mr. Fitzgerald said, while also voicing support for additional cracker plants. He said the city shouldn’t be telling people in Greene, Washington, Beaver and Butler counties “how to live,” but allowed that he wouldn’t support a cracker plant in Lawrenceville.

FBI Investigating How Pennsylvania Governor Tom Wolf Approved Natural Gas Pipeline – (AP) – The FBI is investigating how Gov. Tom Wolf’s administration came to issue permits for construction on a multibillion-dollar pipeline to carry natural gas liquids across Pennsylvania, The Associated Press has learned. FBI agents have interviewed current or former state employees in recent weeks about the Mariner East pipelines, according to three people who have direct knowledge of the agents’ questions. All three spoke on condition of anonymity. When permits were approved in 2017, environmental advocacy groups accused Wolf’s administration of pushing through incomplete permits that violated the law. Wolf’s administration is declining comment. It has said in the past that the permits contained strong environmental protections and it denied forcing the Department of Environmental Protection to issue them. The chief federal prosecutor in Harrisburg, U.S. Attorney David Freed, declined comment.

Wolf says he’s unaware of any wrongdoing in Mariner East pipeline permitting process — Gov. Tom Wolf said he was surprised when, late Tuesday evening, he began hearing reports that the FBI is conducting a corruption investigation into the permits his administration issued for construction of a major natural gas pipeline.Wolf, a Democrat, addressed the situation for the first time Wednesday afternoon, saying he is not aware of any wrongdoing.According to the Associated Press, the FBI has been interviewing current or former Wolf administration employees about the permitting process for the Mariner East 2 project. The multibillion-dollar pipeline began operating last year, and carries natural gas liquids from Marcellus Shale fields in Ohio and western Pennsylvania to an export terminal near Philadelphia.  The AP says the FBI is trying to determine whether Wolf or his administration tried to force the Department of Environmental Protection to approve construction permits, and whether Wolf or his administration received anything in return for doing so. Greg Vitali, a Democratic Representative from Delaware County and vocal pipeline critic, said he doesn’t have firsthand knowledge about the FBI probe, but has heard rumors regarding the permits.“I was generally aware that people felt DEP came under some pressure to get these permits,” he said. The Mariner East 2 project has been plagued by sinkholes and drilling mud spills. Regulators halted construction multiple times, and Sunoco has been repeatedly fined.Wolf said he willingly called for those shutdowns, but added that he supports the pipeline on principle.“As long as they follow the rules that are in place, I think they should be allowed to proceed with their project,” he said.Vitali said he is less sure that the rules have all been followed.“I think questions have been raised with regard to the speed at which that was approved and the process by which it was approved that really justify inquiry,” he said. “I can say that with confidence.” Counting the reported FBI probe, the Mariner East project is now the subject of three criminal investigations.

Rep. Keller touts Williams partnership - Congressman Fred Keller, R-Pa., heard from representatives of Williams Energy last week during a stop in Wyoming County, also taking an opportunity afterwards to visit a natural gas compressor station. At the Williams headquarters in Tunkhannock on Wednesday (Nov. 6), Keller participated in a closed door meeting with Williams employees, who shared their desire for him to continue advocating for pro-energy legislation in Washington, D.C. In Washington, Keller said he plans to become a co-sponsor of H.R. 3893, which Congressman Bill Flores, R-Texas, introduced in July “to provide for federal and state agency coordination in the approval of certain authorizations under the Natural Gas Act, and for other purposes.” Employees spoke to Keller about the importance of such policies that support the development of energy industries and allow companies like Williams to achieve. While certain industry regulations remain necessary, Keller said he aims to make sure they don’t become “over-burdensome and impede development.”

PennEast appeals pipeline rejection to Supreme Court - (AP) — A gas company whose bid to build a 120-mile natural gas pipeline through parts of Pennsylvania and New Jersey was rejected in court says it will appeal to the U.S. Supreme Court. The PennEast Pipeline Company said Thursday it would file its appeal by a February deadline. In September, a federal appeals court in Philadelphia sided with New Jersey officials who argued the company can't use eminent domain to acquire state-owned properties that are preserved for farmland or open space. The judges wrote that the ruling could change how the natural gas industry operates.In a statement Thursday, PennEast said the ruling disregarded Congress’s intent when it enacted laws governing natural gas. It said delayed pipeline construction in several states has forced small businesses to close and disrupted major development projects. “No interstate pipeline nationwide of any significant length can be built without crossing land were a state claims an interest,” said Anthony Cox, Chairman of the PennEast Pipeline Board of Managers, on Thursday. In addition, when the Federal Energy Regulatory Commission approved the current route for the pipeline, commission members understood that it crosses properties in which New Jersey claims and interest, Cox said. Pipeline opponents said Thursday that PennEast officials are “trying to do whatever they can” to push the pipeline through.

U.S., Philadelphia officials object to PES refinery sale process (Reuters) - U.S. and local officials are opposing the sale procedure for the bankrupt Philadelphia Energy Solutions oil refinery, arguing the plan discourages bidders and keeps the city locked out of the process, according to federal court filings. The proposed PES sale plan does not give potential buyers of the fire-damaged refinery enough time or information to outbid a stalking-horse bid chosen by PES, U.S. Trustee Andrew Vara argued in a filing with the U.S. Bankruptcy Court in Delaware on Thursday. Companies often select what is known as a stalking horse to start an asset sale. Other parties then submit bids, which, if for more money or better for some other reason, would win out. PES’s proposal sets a stalking-horse deadline one day before final bids are due, which “will create confusion, delay and may tend to discourage bidders” who might not know what they are attempting to outbid, said Vara, who is appointed to oversee the bankruptcy case. The city of Philadelphia, which is a creditor in the bankruptcy case and a regulator of the refinery, also objected to the sale process in a filing with the court on Thursday. It is asking PES to disclose the identities of qualified bidders and allow the city to attend the refinery auction, which it would be excluded from under the current plan, Philadelphia’s deputy city solicitor, Megan Harper, said in the objection.

City and union officials to consult on Philadelphia refinery sale process -U.S. court (Reuters) - A U.S. bankruptcy judge on Thursday approved a process for the sale of the Philadelphia Energy Solutions oil refinery, the largest and oldest on East Coast, under which city officials and a trade union will consult on the matter. The plan resolves earlier objections by giving the United Steelworkers union and Philadelphia city officials access to the identities of bidders and, in some cases, the ability to speak with potential buyers, according to the order signed by Judge Kevin Gross of the U.S. Bankruptcy Court for the District of Delaware. An auction date for the PES refinery was set for Jan. 17 in New York. PES collapsed into bankruptcy on July 21 and put its 335,000 barrel-per-day refinery up for sale after a fire tore through an alkylation unit at the Girard Point section of the plant a month earlier. Most of the 1,100 PES workers, including more than 600 members of the United Steelworkers local union, were laid off without severance or benefits. About a dozen parties have shown interest in buying the plant, pitching various uses for the facility, including a biofuels operation and restoring the oil refinery back to its full capacity. The city, community activists and workers advocates have called for more transparency in the sale process of the fire-damaged plant, which could require city-issued zoning and other permits for approval. Gross on Thursday also signed off on an additional $35 million in debtor-in-possession financing for PES, giving the refiner more time to pay legal fees and other bills as it fights for insurance coverage tied to the fire. PES has already received $65 million in bankruptcy financing and a $50 million advance on future insurance proceeds. However, it has been unable to receive any of the $1.25 billion in property damage and business interruption insurance coverage.

National Grid to use trucked LNG, CNG in peak US Northeast winter gas demand periods — Facing a potential shortfall in natural gas supplies due to certain factors, including regulatory holdups of a key interstate pipeline project, gas utility National Grid is planning to use trucked shipments to ensure supplies to customers in New York and New England during the coldest parts of winter. The Rhode Island Energy Facility Siting Board on November 6 approved the utility company's request for a temporary waiver from the licensing requirement of the Energy Facility Siting Act to operate a temporary LNG vaporization facility on a site in Portsmouth, Rhode Island, which National Grid had previously used for that purpose. The plans call for National Grid to truck in LNG to the site, where it will be vaporized and injected into the local gas distribution system to provide an emergency backup gas supply to Aquidneck Island. The project will only be on the site from December 1 through March 31 and will only be mobilized when it is required to back up the gas supply to the island, the utility said in its waiver request. National Grid has announced similar plans to truck in compressed natural gas to serve as backup supplies of gas during peak usage periods in New York state. The utility contends it needs to take those steps to ensure New York customers have adequate access to supplies because of state regulators in New York and New Jersey having slowed the progress of the 37-mile Northeast Supply Enhancement project, which is designed to bring 400 MMcf/d of incremental gas supply into New York City and Long Island. "We've been waiting for the approvals for the NESE supply line," "We've got a shortfall in peak-hour supply; we're short approximately 21 Dt/hour at the peak." .

Cuomo Threatens National Grid: Provide Gas or Lose Your License - Gov. Andrew M. Cuomo and a utility that provides gas to New York City and Long Island have been locked in a standoff since May, when New York regulators blocked the construction of a $1 billion natural gas pipeline that would have run from Pennsylvania to New Jersey and New York. The utility, National Grid, says the pipeline is crucial to meeting the rising energy demand in the region and has imposed a moratorium, refusing to activate gas hookups for both new and returning customers. On Tuesday, the fight took a sharp turn after Mr. Cuomo threatened to revoke National Grid’s license to operate in the southern part of New York. Mr. Cuomo, in a letter, accused the utility of “mishandling” its gas supply system and recklessly disregarding its obligations as a public utility when it issued the moratorium. Sign up for the New York Today Newsletter Each morning, get the latest on New York businesses, arts, sports, dining, style and more. The utility’s fundamental legal obligation “was to plan and provide for future needs,” the governor wrote. “You failed by your own admission.” National Grid, which supplies gas to 1.8 million customers in New York City and on Long Island, said it would review Mr. Cuomo’s letter and respond accordingly. “We continue to work with all parties on these critical natural gas supply issues on behalf of all our customers in downstate New York,” the utility said in a statement. The moratorium has left some people in Brooklyn, Queens and Long Island in flux. Developers have been unable to provide gas to new buildings, business owners cannot obtain requested upgrades and homeowners have had to fight to get suspended gas service restored. “At this point, a number of projects are in limbo because of uncertainty over the energy supply,” said Kathryn S. Wylde, the president of the Partnership for New York City, an influential business group.

National Grid pushed officials to write letters for pipeline - — A renewable energy watchdog group is calling foul over National Grid's efforts to get local government officials to support a new natural gas pipeline that would be built under the Hudson River between Bethlehem and East Greenbush. The so-called E37 pipeline, which has been opposed until now by both Bethlehem and East Greenbush, would close a loop in the local natural gas transmission network owned by National Grid, another reason why the project is also known as the "Albany Loop." However, the watchdog group Energy and Policy Institute, which supports renewable energy development, says that National Grid has been employing public officials from around the Capital Region to support the project using "customized" form letters to the state Public Service Commission, which must approve the project. Environmental groups opposed to hydrofracked natural gas and pushing for the state to reduce the consumption of fossil fuels opposed the E37 pipeline and any other new natural gas infrastructure being built in New York. Revelations of the public affairs campaign by National Grid comes amid a fight between the utility and Gov. Andrew Cuomo, who has vowed to take away National Grid's license to operate its natural gas system in New York City and Long Island. That fight came after National Grid stopped hooking up new gas customers downstate after the Cuomo administration blocked an interstate gas pipeline from being built to New York City.

Compressor station project gets final state approval -  Weymouth lost a key battle in a years-long war against a proposed 7,700-horsepower natural gas compressor station Tuesday as state regulators gave the project the green light in the final step of the state approval process. The Massachusetts Office of Coastal Zone Management on Tuesday issued its decision that the project is consistent with the federal Coastal Zone Management Act. That approval is the last of four that the project needs, and has received, from the state. Mayor Robert Hedlund said he is “very disappointed” in the approval, particularly because it was issued despite recent changes “dramatically reducing” the demand for gas and need for the project. Hedlund sent a letter to Lisa Berry Engler, director of the state Office of Coastal Zone Management, last week saying that the justification for allowing a compressor station in a coastal zone was “already factually tenuous and, in the town’s view, legally inadequate,” but new information about natural gas capacity and demand warranted further review from the state. The compressor station proposal is part of Enbridge’s Atlantic Bridge project, which would expand the Houston company’s pipelines from New Jersey into Canada. Hedlund said two companies that had signed on to ship natural gas made available through the Atlantic Bridge project have withdrawn and assigned their rights to the gas to National Grid. But National Grid has stated it does not need the compressor station to deliver the gas. Several other project shippers have said the compressor station is not necessary for their use of the increased capacity, he said. “While government is approving the project, the market is telling us it is no longer needed. By the time all permits and appeals are done, few will actually buy the natural gas,” Hedlund said Tuesday. “We will end up with a $100 million white elephant on the Fore River waterfront whose costs will then be passed on to ratepayers.”

Mayors testify in support of legislation that would improve gas safety in Bay State – - Fourteen months after a series of gas-fueled explosions and fires rocked the Merrimack Valley, the New England Gas Workers Alliance, along with prominent Bay State mayors, flocked to Beacon Hill on Tuesday to testify in support of legislation that would improve gas safety in Massachusetts. For some who live in Lawrence, Andover, and North Andover, the horrid memories of Sept. 13, 2018, still bring them to tears. “Our city, our kids, our youth. They’re still traumatized,” Lawrence resident Ana Javier told lawmakers. National Transportation Safety Board investigators pinned the blame for the disaster on Columbia Gas, citing their poorly planned pipeline replacement project and inadequate response to dozens of fires that were sparked by excessive pressure in natural gas lines. On Tuesday, lawmakers heard testimony on several bills focused on oversight and safety. “No one has been fined. Not one fine has been levied against Columbia Gas,” Lawrence Mayor Dan Rivera said. “Not one person has lost their job at Columbia Gas.”

Strong Gas Odor Continues To Linger In Delaware County After 2 Separate Incidents – CBS Philly  — It’s the question on the minds of many Delaware County residents — what’s that smell? A gas leak near an apartment complex Monday night led to a strong odor in the air. There was also a strong odor of gas along the I-95 Corridor and Chester Pike. Emergency officials say these are two separate incidents. While always busy, the Delaware County 911 Center wasn’t bombarded on Tuesday, 24 hours after hundreds of calls rolled in for a gas-like odor across the county. “Delaware County’s trying to figure out what this odor — this smell’s been permeating the county the last couple of weeks. It’s definitely concerning but we’re no closer to figuring out what it is,” Emergency Management Director Tim Boyce said. Separate from the widespread gas odor that has now happened twice in three weeks, a valve on Monday night malfunctioned on an eight-inch gasoline transmission line. A handful of first responders were even sickened from what emergency officials say was a significant discharge. Most of the tenants at the Turnbridge Apartments left because the smell was so powerful. “I started packing up a bag, came downstairs hoping to get a clear answer. The ambulances showed up, some of the fire department seemed to be a little sick so that made me want to leave,” resident Emily Franquet said. While not directly connected to the Mariner East pipelines, the gasoline discharge incident has renewed fears for those living along the controversial energy project.On Tuesday, the Associated Press reported the FBI is reviewing how Mariner East Two was granted permits by the state’s environmental protection department. Meanwhile, some here in Middletown Township say they’ve had enough. “It’s frightening because we don’t have any answers,” resident Kathy McGuire said. “It’s a very strong smell.”

Delco officials raise stink over odors, leak, launch criminal probe — Unable to determine the cause of two widespread noxious odors within three weeks and dissatisfied with the method of notification regarding a gasoline leak from pipeline, Delaware County's top Emergency Services official called for a criminal investigation. "I really think a criminal investigation needs to begin because someone is willfully doing this," Delaware County Emergency Services Director Timothy Boyce said of the odor incidents. "We're not able to determine the source of the product release ... It's not impossible that somebody's trying to dump chemicals. We're not taking this lightly." He explained that Chester has been dealing with the odors of gas all summer long in which county hazardous materials teams would respond but the source was not able to be located. On Oct. 25, the county's 911 Center received calls from first responders and residents in the area of Chester Heights, Aston and Concordville of an unidentifiable odor that smelled like gasoline or home heating oil. Then, calls from Broomall, Newtown Square, Media and Springfield were received. Some callers reported sore throats and headaches. Some businesses closed and the Chester Charter School dismissed early. On Monday morning, another foul-smelling odor was reported along Route 291 in Ridley and then it wafted over Chester, Eddystone, Ridley Park and Glenolden. Boyce said Boeing was prepared to evacuate their entire campus but did not. Monday evening, several residents called reporting a smell of gasoline in the Middletown area near the Tunbridge Apartments. Boyce said when first responders arrived, two workers became nauseous as they discovered contractors tending to a leak from a Sunoco pipeline valve station.

Preston High School seniors take part in free oil and natural gas course – Seniors at Preston High School participated in a free oil and natural gas training class Wednesday, right in their school. It’s part of the West Virginia University Extension Service’s IADC Rig Pass SafeLandUSA course, which certifies participants with safety and health hazard training program before they even hit the workforce. In addition, students will receive training in first-aid/CPR training and receive ATV training. The program is available to up to 400 seniors and takes eight hours. Seniors Arrington Bucklew and Chase Laughry said they considered the training to be significant to their futures. Laughry said he had not considered a career in oil and natural gas but that he had become really interested after the training began. He said he hopes to make something out of the learning opportunity. “It’s very significant, it’s going to make an impact on my whole life, it’s going to help me get a job out of high school, make a living and hopefully start a family,” Laughry said.

Valley Activists Aid Mountain Valley Pipeline Opponents | WMRA and WEMC (podcast, transcript)  The proposed Mountain Valley and Atlantic Coast pipelines are slated to carry natural gas from West Virginia through Virginia, and in the case of the Atlantic Coast pipeline, on into North Carolina. Even as construction has been halted or limited by legal challenges, opposition to those projects remains strong among some residents. WMRA’s Randi B. Hagi reports. Listen Listening...5:16   Attendees discuss the Mountain Valley and Atlantic Coast pipelines, and FERC's role in their construction.  A small crowd gathered in a chapel on the grounds of Trinity Episcopal Church in Staunton on one October afternoon. They sang, not hymns, but protest songs. [singing] The event was hosted by the organization Beyond Extreme Energy, a network of activists that aims to raise awareness about the impacts of hydrofracking and other practices by fossil fuel industries. They came to Staunton as part of a “roadshow,” promoting their campaign to dissolve the Federal Energy Regulatory Commission, or FERC, and set up a Federal Renewable Energy Commission in its place. FERC is responsible for approving interstate infrastructure that transmits natural gas, oil, and electricity.

Senior advisor to lawmakers: Gov. Cooper's office didn't meddle in DEQ permitting of Atlantic Coast Pipeline - Skepticism about the economic promises of the Atlantic Coast Pipeline prompted Gov. Roy Cooper’s office to establish a $57.8 million mitigation fund, a top official told lawmakers this morning. Ken Eudy, senior advisor to the governor, told theJoint Subcommittee on the Atlantic Coast Pipeline that Cooper did not use a key water quality permit as pressure utilities to create the fund. “From the outset, Gov. Cooper told Duke Energy the permitting would be handled by experts at DEQ based on the science, technology and the law” Eudy said. “There was no interference.” Duke Energy and Dominion Energy are majority owners of the Atlantic Coast Pipeline. The 600-mile project would start at a fracked gas operation in West Virginia, travel through Virginia and enter North Carolina near Garysburg in Northampton County. From there, it would route 160 miles through eight counties: Northampton, Halifax, Wilson, Nash, Johnston, Cumberland, Sampson and Robeson. These counties, Eudy said, “bear all of the risk and reap none of the reward.” Eudy reiterated what had been disclosed in public documents, but his comments did underscore major turning points in the ACP controversy:

  • Eastern North Carolinians, even business interests, became increasingly skeptical about the supposed economic promise of the ACP.
  • Meanwhile, opposition to the project was intensifying.
  • Duke Energy appeared impatient and concerned about the state’s lengthy permitting process.

After months of review and requests for more information from the utilities, the NC Department of Environmental Quality approved the essential water quality permit — a 401 — on Jan. 26, 2018. Within two hours of that approval, the governor’s office announced the mitigation fund and a memorandum of understanding, which was voluntary, with Dominion Energy. Immediately, environmental advocates and Republican lawmakers — rarely on the same side of an issue — speculated that a quid pro quo was at work.

GOP swings and misses with pipeline attacks on Cooper | NC Policy Watch - In Trumpland no lie about the environment or giveaway to a polluting industry is too blatant or outrageous. Trump doesn’t just relax regulations on the environment, he hires professional polluters to head the agencies charged with environmental oversight and then unleashes them to aggressively worsen environmental devastation. All of which serves to make it just a little bit difficult to take the much ballyhooed Republican investigation into Cooper’s clumsy handling of the Atlantic Coast Pipeline controversy terribly seriously. For nearly two years now, having repeatedly found themselves politically outmaneuvered by (and dramatically less popular than) the Governor, Republican lawmakers at the General Assembly have been advancing all manner of frenzied claims and conspiracy theories about the pipeline and the supposed treachery of the Cooper administration in approving it. These include claims that:

  • the approval of environmental permits for the pipeline were driven by politics and self-dealing rather than the findings of Department of Environmental Quality regulators;
  • the “mitigation fund” to which the pipeline owners agreed to contribute in order to address its negative environmental and economic impacts was really just a “slush fund” for Cooper to oversee;
  • Cooper was improperly infringing on legislative authority by attempting to establish and administer the mitigation fund; and
  • Cooper and his family stood to personally profit from the pipeline and related regulation of a solar energy farm.

Unfortunately for the GOP, despite some awkward and awkwardly timed moves by the administration on the matter, every effort to advance these theories keeps running into a dead end. The latest such occurrence took place last week when a legislative hearing on the matter failed to unearth any new or damning findings.

Dominion official: Company remains committed to ACP, construction expected to be complete in 2021 — Despite numerous setbacks, legal challenges and opposition from environmental advocacy groups, a Dominion Energy official said the company remains confident that construction of the Atlantic Coast Pipeline will be complete by 2021. Anand Yegan, director of gas transmission business development for Dominion, gave industry stakeholders a compressive overview of the project’s current standing during the West Virginia Oil and Natural Gas Association’s 2019 Fall Meeting in Morgantown. The company believes the U.S. Supreme Court will ultimately rule in its favor when the justices hear oral arguments next year relating to a decision by the U.S. Court of Appeals for the Fourth Circuit that revoked a key permit needed for construction to continue, Yegan said. “The case is going to be heard in the Supreme Court — we expect to have oral hearings in late winter, springtime of 2020 with a decision expected no later than June 2020,” he said. “It’s a huge, positive step for the project. It’s also an endorsement of some of the things that we believe, that the permit issuance was done the right way.” The Fourth Circuit’s decision denied a permit issued by the Forest Service allowing the pipeline’s route to go through two national forests and across the Appalachian Trail. Dominion voluntarily halted all major construction activities on the pipeline in December following the Fourth Circuit’s decision, which resulted in layoffs for much of the project’s workforce. Developers are also awaiting the outcome of a challenge to the project’s biological opinion, relating to the Endangered Species Permit issued by the U.S. Fish and Wildlife Service, Yegan said. “In this case, the Fourth Circuit found that Fish and Wildlife, the process and analysis that went into it, were deficient and they needed to do more,” he said. “Right now as we stand we are working with Fish and Wildlife to reinitiate consultation and expect the resistance of the biological opinion by winter of 2019-2020.”The overall budget for the project, not including financing costs, is now between $7.3 and $7.8 billion, Yegan said.

More modest batch of US natural gas pipelines seek to start service for winter 2019-20 — Several US natural gas pipeline developers are seeking federal regulators' permission to start service in time for the heating season in the eastern US and Midcontinent, but the capacity coming on tap pales in comparison to recent years. Among those asking for the nod from the US Federal Energy Regulatory Commission to start up this month include the 400,000 Dt/d Spire STL project in Illinois and Missouri; RH energytrans' 55,000 Dt/d Risberg Line in Pennsylvania and Ohio; Transcontinental Gas Pipe Line's 65,000 Dt/d Gateway Expansion in New Jersey; and the Lambertville East Expansion, a Texas Eastern Transmission compression project adding 60,000 Dt/d in New Jersey. New capacity placed into service in the Northeast US this winter will be significantly less than in years past. The Gateway Expansion, Lambertville East Expansion and the Risberg line together would add just 190,000 Dt/d of new capacity in Northeast markets this winter -- compared with the roughly 4.5 million Dt/d of capacity added in the fourth quarter of 2018. The past several years saw a wave of producer-backed projects enter service in the Northeast, mainly adding takeaway capacity out of constrained Appalachian producing areas. Transco's 1.7 Bcf/d Atlantic Sunrise, Columbia Gas Transmission's 1.3 Bcf/d WB XPress and the 1.5 Bcf/d Nexus Gas Transmission projects all began service in late 2018, followed by the 2.7 Bcf/d Mountaineer XPress project in the first quarter of 2019. The buildout has slowed dramatically, to the point where essentially no major pipeline projects are currently under construction in the Northeast. The remaining greenfield projects left in the queue -- Mountain Valley Pipeline, Atlantic Coast Pipeline and PennEast Pipeline -- have been beset by various legal challenges and permitting delays, driving up expected costs and pushing back targeted in-service dates.

Forecast Weather Demand Moves Higher Over Last 48 Hours, But Natural Gas Prices Continue Falling -- After a strong rally that sent prices in the December natural gas price all the way to $2.90 last week, sellers have been in control over the last few sessions. We did see a drop in projected demand in weather forecasts coming out of the weekend, but that has changed in the last 48 hours, with a healthy move back in the colder direction, especially by the GEFS model.  Despite the move back colder, we have seen no hint of a bullish reaction in the land of prices, as the December contract has fallen all the way down below the $2.60 level today. This is typically the time of year when weather changes rule when it comes to natural gas volatility, so what gives? There are a couple of issues. As seen in the chart above, even with the colder change over the last 48 hours, projected demand beyond this week still is just "near normal", with no days anywhere close to this week's peak cold. Another issue is with supply. We saw a new record high in production this past weekend, and while there are some freeze-offs currently, leading to a decline in production, the amount of freeze-offs appears to be less than what the market had anticipated given the strength of the cold. In addition, Canadian imports have ramped up this week, making up for a large portion of what production declines we have seen. The end result is that this week's supply is turning out to be higher than expected, and that is, for now, negating the gain in forecast demand seen over the last two days, especially with no days in the forecast strongly to the cold side in the medium range. Now, if we continue to add demand back, or see a colder start to December, it is likely the market will take notice more. Or, on the flip side, if the pattern steps solidly to the warmer side in December, there is likely still room to fall considerably, even from today's price levels.

US natural gas storage volume increases by 3 Bcf to 3.732 Tcf: EIA | S&P Global Platts - US working natural gas volumes in underground storage added 3 Bcf last week, according to the US Energy Information Administration Thursday, increasing much less than the five-year average for the corresponding week and marking the last net injection of the year, while the remaining NYMEX Henry Hub winter strip added about 2 cents following the number's release. US working natural gas volumes in underground storage added 3 Bcf, increasing by much less than the five-year average and marking the last net injection of the year, while the remaining NYMEX Henry Hub winter strip added about 2 cents following the number's release. Storage inventories increased to 3.732 Tcf for the week ended November 8, the US Energy Information Administration reported Thursday morning. The injection was less than an S&P Global Platts' survey of analysts calling for a 7 Bcf addition. Survey responses ranged from a net change of zero to a 12 Bcf build. The build was less than the 42 Bcf injection reported during the corresponding week in 2018, as well as the five-year average addition of 30 Bcf, according to EIA data. As a result, stocks were 491 Bcf, or 15%, more than the year-ago level of 3.241 Tcf and 2 Bcf, or 0.1%, more than the five-year average of 3.73 Tcf. The NYMEX Henry Hub December contract added 4 cents to $2.64/MMBtu following the announcement. The remaining winter strip, December through March, gained 2.5 cents to average $2.63/MMBtu. The price of gas this winter has been oscillating higher and lower over the past few months, and it has been on the downswing over the past week after topping out near $2.85 in early November. The only EIA region to post a net injection was South Central, which added 8 Bcf. Volumes fell slightly in the Midwest and Pacific while remaining flat in East and Mountain storage fields. A forecast by S&P Global Platts Analytics' supply and demand model has storage volumes decreasing by 86 Bcf for the week ending November 15, marking the official flip to heating season. Colder temperatures continue to drive up residential-commercial demand, and the week in progress has seen demand begin to exceed supplies by more than 10 Bcf/d, pointing to a sizable withdrawal. Total demand is up 14 Bcf/d on the week to average 108.7 Bcf/d. In the Northeast, where residential-commercial demand is up nearly 5 Bcf/d, power burn also notably moved higher, gaining 1 Bcf/d on the week. Upstream supplies this week are up 0.7 Bcf/d overall to an average 97.2 Bcf/d. A roughly 0.5 Bcf/d drop in US production was offset by an increase in net Canadian imports, which were aided in part by a drop in exports on Nexus Pipeline.

US Natural Gas Production Has Hit An All Time High - Dry natural gas production in the United States will rise to an all-time high of 92.10 billion cubic feet per day (Bcf/d) in 2019, the EIA reported on Wednesday in its latest version of the Short Term Energy Outlook. That figure is up 10% from 2018, but the EIA forecasts that the production growth in 2020 will be less due to “the lag between changes in price and changes in future drilling activity.” The low prices for nat gas in Q3 2019 will trickle down and eventually reduce natural gas-directed drilling, the EIA says, by the first half of next year. Natural gas production in 2020 is expected to reach 94.9 Bcf/d. Total primary natural gas supply will also rise to 85.10 Bcf/d in 2019, before reaching 86.45 Bcf/d in 2020, the EIA said. For net natural gas exports, the EIA is forecasting 4.8 Bcf/d in 2019, and then increasing to a staggering 7.4 Bcf/d in 2020. This is up from 2.0 Bcf/d in 2018, for a two-year increase of 270%. The EIA estimates that the share of US total utility-scale electricity generation from natural gas-fired power plants will increase to 37% of the total in 2019 and 38% in 2020—up from 34% in 2018. This increase will largely come at the expense of coal-fired power, which will fall from 28% of the total last year to 25% in 2019 and 22% in 2020. This shift from coal to natural gas will also be responsible for lowering the projected carbon emissions in 2019 and 2020, to 5,180 million tonnes in 2019 and 5,074 million tonnes in 2020, the lowest level since 1991, Reuters reported. The bridge fuel that the renewables industry is dismissing is, it would appear from the EIA data, far from “behind us”, with the EIA reporting no modest growth in renewable utility-scale generation in 2019 and 2020.

Natural Gas Price Prediction - Prices Rally but Drop 3.8% for the Week - Natural gas prices moved higher but remain range bound, as solid production and warmer than normal weather have weighed on prices. Prices declined nearly 4% this week after surging the following week as hedge funds covered short positions. The weather is expected to remain normal over the next 6-10 and 8-14 days according to the National Oceanic Atmospheric Administration. Support is seen at the November lows at 2.52. A break of this level would see a test of the October lows at 2.38. Resistance is seen near the 10-day moving average at 2.73. Short term momentum is neutral as the fast stochastic hover near the middle of the neutral range with a flat trajectory. The EIA reports that the United States set new records in natural gas production, consumption, and exports in 2018. In 2018, dry natural gas production increased by 12%, reaching a record-high average of 83.8 billion cubic feet per day according to the EAI. This increase was the largest percentage increase since 1951 and the largest volumetric increase in the history of the series, which dates back to 1930. U.S. natural gas consumption increased by 11% in 2018, driven by increased natural gas consumption in the electric power sector.

EIA: US is building 134 natgas lines - The U.S. will add between 16 billion cubic feet per day and 17 Bcf/d of natural gas pipeline capacity in 2019, according to the Energy Information Administration. Of the 134 active natural gas pipelines being built tracked by the federal agency, 46 have entered or are expected to begin service in 2019, it said. Most were or are being built to provide additional takeaway capacity out of natural gas supply basins. Many of the pipelines will move natural gas to Mexico or to liquefied natural gas export facilities on the Gulf Coast, Kallanish Energy reports. More than 40% of the new pipeline capacity – about 7.2 Bcf/d – delivers natural gas to locations within what the EIA calls the South Central region, a seven-state region that includes Louisiana and Texas. About 10 Bcf/d of new pipeline capacity lies within that region, the EIA said. Many of the pipeline projects will provide additional takeaway capacity from the Permian Basin in West Texas and New Mexico, or enable Permian natural gas production to reach interstate pipelines. The EIA cited Kinder Morgan’s Gulf Coast Express Pipeline, Oneok’s Roadrunner Eastbound Expansion and El Paso Natural Gas Pipeline’s Northern Delaware Basin Expansion project. The agency said the remainder of the projects slated for completion in the seven-state region in 2019 will deliver natural gas to demand centers, especially LNG export facilities on the Gulf Coast. EIA cited Cheniere’s Midship Pipeline from Oklahoma to the Sabine Pass LNG faciluty in Louisiana and the Texas East Transmission Co.’s Stratton Ridge Expansion to the Freeport LNG facility in Texas. The only natural gas pipeline in the seven-state region in 2019 that moves natural gas outside the region is the Valley Crossing Pipeline, which exports to Mexico, EIA said. The largest projects completed in 2019 in the Northeast U.S. are Millennium Pipeline’s Eastern System Upgrade Project that increased shipments to customers in Pennsylvania and New York, and Transcontinental Gas Pipeline’s Rivervale South to Market Project, with increased shipments to New York City. The region including Pennsylvania, West Virginia and Ohio is expected to get nearly 5 Bcf/d in new natural gas pipeline capacity.

Crews work to remove oil from overturned cargo ship (WTOC) -Response crews working to stabilize and salvage the overturned Golden Ray cargo ship were at work this week removing more oil from the vessel. Crews repelled down into the hull of the ship to clear a path for oil spill equipment. It will be used to pump oil out of hard to reach places inside to keep it from polluting the sound. That ship capsized in early September.

Offshore Oil to Peak in 2020, Then Slow Down-- Offshore oil production is expected to hit a peak in 2020 before joining the shale industry in a slowdown that could dramatically rewrite market supply predictions. A report by analysts at Sanford C. Bernstein & Co. sees projects in the Gulf of Mexico and off of South America significantly boosting output next year. After that, though, the odds drop for any further growth gains, the report found. Meanwhile, two well-known shale pioneers last month forecast a downturn ahead for their sector. Together, the warnings could signal a new era for a commodity that’s selling for about half the price reached just five years ago. The catalyst is a shareholder push for spending discipline. The result: Potentially a “tempting scenario” for investors where oil prices rise even as costs and demand fall, said Bob Brackett, a Bernstein report author. Three crude sources have seen substantive growth this century -- deepwater, shale and oil sands, according to Brackett. “The first peaks in 2020,” he wrote in an email. “The second peaks a few years later (and is slowing). And the future of oil sands is in question from a sustainability/CO2 impact.” The offshore industry has struggled to maintain growth since oil prices plunged to less than $30 a barrel in 2016 after reaching more than $100 in mid-2014. The high prices spurred a flurry of expensive projects between 2010 and 2014. But today those projects are “barely able” to generate value, according to industry consultant Rystad Energy, which evaluated offshore oil fields sanctioned since 2010 in an Oct. 30 report and ranked them by estimated value per barrel of oil. While newer deepwater projects are less expensive, they still take longer to develop than shale wells and they can’t compete on costs. Over the last few years, roughly $100 billion in spending has shifted to shale work as a result, according IHS Markit. Royal Dutch Shell Plc’s decision last month to pull the plug on a pair of projects in Kazakhstan because of their high costs points to offshore’s changing status. The latest example hit last week when Brazil failed to draw bids from the world’s oil majors in its auction of deep-sea deposits that could hold 15 billion barrels of oil, almost twice as much as Norway’s reserves. “The pipeline of things that have been discovered just won’t get sanctioned,” Brackett said.

New owner of pipeline that ruptured in Arkansas in 2013 keeping eye on potential restart The new owner of a pipeline that ruptured in a central Arkansas neighborhood in 2013 is looking into a possible restart, and water utility officials are watching. Energy Transfer Partners LLC, which owns the Pegasus pipeline, notified Central Arkansas Water on Oct. 24 that the company intends to begin testing the pipeline, which hasn't been in operation since 2013. The 858-mile pipeline stretches from south Texas to Illinois. When it was in use, it transported crude and refined oil products. On March 29, 2013, a rupture of the pipeline spilled tens of thousands of gallons of heavy crude oil into a subdivision in Mayflower. The oil also reached drainage ditches and a cove of Lake Conway. Exxon owned the pipeline at the time and is still a minority owner. Central Arkansas Water CEO Tad Bohannon briefed the utility's board of commissioners on the potential restart at its regular meeting Thursday. The pipeline runs through the watershed of Lake Maumelle, one of the utility's water sources. If there were a rupture along the north shore, oil would make its way into the lake; the 2013 break would have been "catastrophic" for the utility's water supply had it occurred 9 miles farther down the pipeline, spokesman Doug Shackelford said. The pipeline runs through more than a dozen smaller water utility systems in Arkansas as well. Pipeline regulations exist mainly at the federal level. Bohannon said the utility would stay in communication with Energy Transfer, though Central Arkansas Water general counsel David Johnson said he didn't know of any requirement that the company give public notice if it does decide to reopen the pipeline.

Atmos Energy reports 99 gas leak repairs in Georgetown for first half of year - Georgetown evacuees are back in their homes and businesses after a gas leak earlier this year. Atmos Energy Company evacuated 86 buildings during February through April because of gas trapped under the soil near Williams Drive. A report from the Railroad Commission of Texas Pipeline determined “Material Failure” caused the initial leak. Atmos representatives say they successfully pumped gas from the soil and replaced pipelines affected by the incident. According to the company’s semi-annual report, crews discovered 99 leaks in Georgetown from January - June 2019. There were 28 gas leaks in Georgetown over the same time period last year. CBS Austin asked Atmos for the number of gas leaks since July, but a spokesperson said they would not be able to access the data before deadline. Right now, Atmos’ website says they’re currently working on 16 pipeline projects in Georgetown. James Masters tells CBS Austin crews told him the leak in front of his home was due to deteriorating line seals. He’s thankful crews are working proactively to stop gas leaks but wonders about the quality of nearby pipes.

San Antonio becomes latest city considering anti-pipeline resolution - — The San Antonio City Council is jumping into a contentious debate over state eminent domain laws and the environmental impact of the growing number of proposed pipelines to move crude oil and natural gas from the Permian Basin. The Houston company Enterprise Products Partners plans to build the 30-inch crude pipeline from the West Texas shale play to the company’s storage tanks and export terminals in the Houston area. Some initial proposals called for the project to go through the picturesque Texas Hill Country and over part of the Edwards Aquifer, the main drinking water supply for San Antonio. Although those plans were scrapped, city leaders responded by drafting a resolution against any future pipeline project from getting built over the environmentally sensitive region and asking state leaders to give landowners and communities a stronger voice and more input for pipeline routes. Enterprise officials did not respond to a request for comment. The company has not finalized a route, but in an early October statement, the company said that the pipeline would not cross the Edwards Aquifer and its recharge area, located to the north and northwest of San Antonio and home to several endangered species of salamanders, fish and beetles. San Antonio’s proposed resolution comes when several communities to the north are raising similar concerns and fighting the Permian Highway Pipeline, a natural gas project proposed by Houston pipeline operator Kinder Morgan. Citing safety and environmental concerns, some 19 cities, counties, school districts and other public entities in the Texas Hill Country have filed resolutions condemning the Permian Highway Pipeline and asking state leaders for stricter laws.

Equinor Inks $325MM Deal to Sell Eagle Ford Assets to Repsol  - Norway’s Equinor ASA has signed an agreement to divest its 63 percent interest in, and operatorship of, its onshore business in the Eagle Ford to Spanish oil and gas company Repsol S.A. for $325MM, the company announced Thursday.The transaction includes all of Equinor’s interests in the Eagle Ford joint venture with Repsol, covering 69,000 net acres. Repsol will possess a 100 percent interest in the asset, upon closing.“This transaction supports Equinor’s strategy to optimize our onshore U.S. portfolio, enhancing our financial flexibility and focusing our capital on our core activities in the country,” Torgrim Reitan, Equinor’s executive vice president for Development and Production International, said in a company statement.“The US is a core area for Equinor, demonstrated by recent acquisitions including assets in the Gulf of Mexico, onshore acreage in the Austin Chalk and the Empire Wind project offshore New York,” he added.Bloomberg reported back in March that Equinor was considering a sale of its operations in the Eagle Ford as it focused on other stateside projects. Equinor, which was previously Statoil ASA, entered the Eagle Ford asset in 2010 through a joint acquisition with Talisman Energy USA (now owned by Repsol). In 2015, Equinor increased its interest in the joint asset from 50 percent to 63 percent and took on full operatorship.

Oxy to Sell Permian Campus After Anadarko Acquisition  -- Occidental Petroleum Corp. plans to sell a four-story office building in the heart of the Permian Basin and move employees into a nearby one owned by Anadarko Petroleum Corp., the oil producer it bought for $37 billion three months ago.The 213,000 square-foot complex will be vacated by April 2020 and is a “compelling” investment opportunity, according to a marketing document from CBRE Group Inc., the real-estate broker handling the sale alongside Midland-based Moriah Real Estate Co.The property was built in 2014 and is located in Westridge Park on the west side of Midland, near the airport. It’s also close to Anadarko’s campus and directly opposite Chevron, which Occidental outbid to acquire Anadarko. EOG Resources Inc. also has an office nearby.“We have told our employees in Midland that they will be moving into the state-of-the-art building that Anadarko began constructing prior to the acquisition,” Melissa Schoeb, a spokeswoman for Occidental, said by email. “The building is large enough to house our combined workforce and we will begin the move when it’s ready for occupancy.”   Occidental is under pressure to sell assets and pay down debt after the acquisition, which has been criticized by investors including billionaire activist Carl Icahn. The stock plunged this week after Chief Executive Officer Vicki Hollub slashed 2020 capital spending by 40%, raising concern that the company won’t pump enough oil to cover dividend payouts and debt service.

OIL AND GAS: Earthquakes and the Permian: What's the link? -- An increased rate of earthquake activity in West Texas is linked with oil and gas production, according to a new study that concentrated on the state's fuel-rich Delaware Basin.

The Permian paradox: Texas shale players go green to drill more - (Reuters) - As the thirst for electricity to power drilling rigs in West Texas drives the state’s energy needs to new highs, oil and gas companies are increasingly relying on wind and solar power to ensure that the shale boom continues. Oil and gas firms operating in the Permian shale basin in West Texas, the nation’s biggest, have been largely behind growth in the area’s energy demand, according to Electric Reliability Council of Texas (ERCOT), which oversees most of the state’s electricity grid. Securing ample, reliable energy supply is critical to sustaining the shale boom that has helped the United States eclipse Saudi Arabia and Russia as the world’s biggest oil producer. Wind and solar farms help oil and gas producers lock in a growing part of that supply in a way that can be easily tailored to their needs as they keep ramping up production, industry experts say. “Gas generation gets cheap if you’re building at a large scale. But if you’re trying to build to match your refinery or E&P (exploration and production) operations, you’d want to build something relatively inexpensive at a smaller scale,” says Manan Ahuja, manager at North America Power Analytics at S&P Global Platts. “You can add more panels or windmills at a later point if your exploration and production grows.” Building their own on-field wind or solar farms is one way to safeguard electricity supply, long-term supply deals with renewable energy firms is another. One recent example is Occidental Petroleum Corp (OXY.N), a major player in the Permian, which announced early last month the launch of a solar-powered facility to power an oilfield operation there. A unit of Occidental also signed a long-term power purchase agreement with a joint venture between Macquarie’s Green Investment Group (GIG) and Core Solar LLC for 109 MW of solar energy, beginning in 2021.

U.S. frack sand suppliers latest casualties in shale industry slump - (Reuters) - The companies that provide sand for hydraulic fracturing operations are the latest casualties of shale industry cutbacks as low oil prices and demands for higher investor returns stunt drilling activity. Two years ago, U.S. sand companies were racing to open West Texas mines to capitalize on a boom in oil and gas drilling, with more than 20 popping up across the region. That led to an oversupply that has driven down profit, which along with a drilling downturn has led some to close mines and others to consider an exit. Demand grew by 50% in the last two years and at its peak the U.S. sand and logistics market was worth about $12 billion a year, according to Joseph Triepke, president of consultancy Infill Thinking, but supplies grew nearly three times as much. “If you look at Permian frack sand prices, we estimate they are down about 80% from the peak,” he added in an interview on Monday, noting that at least two mines in West Texas have closed. Carbo Ceramics Inc (CRR.N) late on Friday issued a “going concern” warning to investors after its largest customer stopped buying its sand, sending its shares down 46% to 85 cents on Monday. Its warning comes as companies that fracture wells are cutting workers and idling equipment. Services firm ProPetro Holding Corp (PUMP.N) recently told investors it would run up to 28% fewer frack spreads this quarter, while market leader Halliburton Co (HAL.N) cut jobs at least twice this year and has idled equipment.

EPA may let oil waste in waterways. Is the public at risk? -- Within a year, Oklahoma could get approval from EPA to start issuing permits that will allow the oil industry to dispose of briny oil field waste in waterways, alarming environmentalists and making it the first of three Southwestern states to step into a thorny regulatory landscape.

Drilling boom adds stress to U.S. western water supplies: report - (Reuters) - About 60% of federal oil and gas drilling leases offered since 2017 are located in areas that are at risk of shortages and droughts, according to a report released on Tuesday. The report from the left-leaning Center for American Progress argued an increase in drilling in these areas could worsen water shortages, a potential problem for ranchers, farmers, and municipalities, because it requires vast amounts of water. “Oil and gas leasing in water-stressed areas has been largely unscrutinized but poses threats to water users across the West,” report author Jenny Rowland Shea said. Oil and gas producers using the hydraulic fracturing process typically pump a concoction of water, chemicals and proppants into underground reservoirs to break open rock formations and increase pressure, forcing hydrocarbons to the surface. A proppant is a material such as sand used to prop open the underground cracks from which oil and natural gas can then be harvested during the fracturing process. The average fracking job now consumes 13 million gallons (49 million liters) of water, up 40% in two years here according to a Reuters analysis of Permian producers’ data reported to The Center For American Progress report analyzed leasing data from the Interior Department and a water risk map from the World Resources Institute. In Nevada, 1,050 of 1,122 drilling leases were offered in areas of “high” or “extremely high” water stress, according to the report. In New Mexico, the heart of the Permian Basin here oil boom, 387 of 402 leases under the Trump administration, or 95%, are located in “extremely high” water-stress areas, it said. The report urged the Interior Department’s Bureau of Land Management to weigh the impact of drilling on local water use in its permitting decisions. “With climate change increasing water scarcity in much of the West, consideration of energy development impacts on watersheds can no longer be optional,”

US oil, gas rig count falls by seven to 869, driven by gas declines: Enverus - The total number of US rigs drilling for oil and gas dropped by seven to 869 compared with last week, according to data released Thursday by Enverus. In the oil-rich Permian Basin, the number of rigs rose to by four to 407, while other oily basins saw slight decreases in the rig count. At 69, the Eagle Ford Shale play of South Texas saw one fewer rig operating than in the previous week, while the SCOOP-STACK play of Oklahoma saw the number of rigs drop by one to 41. The number of rigs operating in the Williston Basin fell by two to 54. Rig counts in the gas-producing Appalachian Basin remained fairly flat week over week, with the Marcellus Dry and Marcellus Wet both seeing no change in the rig count, at 20 and 16 rigs, respectively. The rig count in Ohio’s Utica Shale play fell by two to 13 week over week. The disparity in the rig counts for oil producing basins versus more gas-focused plays follows a longer-term trend, said Sami Yahya, an analyst with S&P Global Platts Analytics. Over the past several months, the number of drilling rigs has declined in both oil- and gas-focused basins, but the decline has been much sharper in the gassier plays, Yahya said. “We’re seeing crude-focused basins holding on a little bit stronger to their rig count than the gas-focused areas like the Haynesville and Marcellus,” he said. In 2020, the number of rigs drilling for natural gas is expected to decline even further, as a number of gas producers have announced plans to cut back on their capital expenditures to focus on improving their cash flow in the wake of the expectation of continued low commodity prices. A recent analysis by Platts Analytics found that a group of Appalachian gas producers, expected to account for nearly 60% of the gas output in the Utica and Marcellus plays in 2020, have lowered their projected drilling capex for next year. As the calendar winds down toward the final weeks of the year, Yahya said rig counts are likely to strengthen, as some operators scramble to meet their estimated annual production targets. “There’s less flexibility to change things,” he said. “Operators made a lot of promises earlier in the year, so there’s a lot that they have to respond to, in terms of meeting those goals they laid out to investors.”

US Drops Eleven Oil, Gas Rigs - For the fifth week in a row, the U.S. has seen its rig count decline. The U.S. dropped 10 oil rigs and one gas rig for a net loss of 11 rigs this week, according to data from Baker Hughes Company. This brings the nation’s total number of active rigs to 806, which is 276 rigs shy of the count of 1,082 one year ago. Texas led all states this week in losses, shedding five rigs. The following states also idled rigs this week: Louisiana (-2) West Virginia (-2) Wyoming (-2) Colorado (-1) North Dakota (-1) Pennsylvania (-1) Utah (-1).  Ohio added two rigs this week, while New Mexico and Oklahoma tacked on a rig apiece. Among the major basins, the Permian shed four rigs this week, the Marcellus lost three and Ardmore Woodford, Cana Woodford, DJ-Niobrara and Williston shed one rig each. The Utica added two rigs while the Mississippian added one rig. Currently, the Permian has 408 active rigs, more than half of the nation’s total.

Trump administration suspends oil and gas production on 130 plots in Utah after challenge - The Trump administration has suspended the production of oil and gas on 130 plots in Utah following a legal challenge by environmentalists. The Bureau of Land Management (BLM) on Sept. 27 quietly issued suspensions of operation and production on 117 plots of previously leased land in Utah and restricted the sale of 130 plots total due to the ongoing litigation, which alleges that officials did not consider greenhouse gas emissions when granting the oil lease sales. “The BLM has concluded that it is necessary to suspend the referenced leases and complete further environmental analysis,” the individual notices read. The decision came after environmental groups legally challenged several lease sales, alleging that the agency failed to satisfy federal environmental laws by not considering the effects of climate change on federal land prior to leasing them for fossil fuel exploration. In March, a federal judge in Washington, D.C., ruled in favor of one such argument by environmentalists, finding that the environmental considerations behind Obama-era lease sales in Wyoming were inadequate. The temporary halt on roughly 300,000 acres was the first time the Trump administration’s energy agenda had been blocked for not considering climate change. The BLM in its September letter said a separate, similar case filed by environmentalists criticizing lease sales in Utah showed clear “parallels” with the Wyoming ruling. Therefore, the administration was suspending production to complete more environmental analysis. “This is another setback for the Trump administration’s irresponsible, illegal decision to lease these beautiful public lands for fracking and drilling,” said Diana Dascalu-Joffe, attorney at the Center for Biological Diversity, in a statement. “BLM officials are starting to recognize the error of their rush to ignore climate science and public health to unleash a fracking frenzy. Now the administration must acknowledge the irreparable harm these irrational decisions have on our fragile climate.”

Fracking Study Shows Toxic Chemical Exposure 2000 Feet From Drilling Sites - A new multiyear study found that people living or working within 2,000 feet, or nearly half a mile, of a hydraulic fracturing (fracking) drill site may be at a heightened risk of exposure to benzene and other toxic chemicals, according to research released Thursday by the Colorado Department of Public Health and Environment (CDPHE) The study concluded that people living within almost a half-mile radius of a fracking well have an increased risk of feeling the effects of chemical exposure though headaches, nausea, dizziness, nosebleeds and respiratory trouble, according to The Denver Post. Until now, Colorado has had a 500-foot minimum distance that drilling wells can be from homes. Thestudy found that, in certain conditions, toxic chemicals like benzene, toluene and ethyltoluenes could be up to 10 times the recommended levels at a 500-foot distance. As you move away from the fracking site, the chemicals dissipate, but could still be at unsafe levels at 2,000 feet away, as Newsweek reported. That takes into account only the chemicals that are known. Some chemicals used in the hydraulic fracturing process are trade secrets. As Newsweek reported, a recent study from the Partnership for Policy Integrity noted that natural gas drillers use a law that allows some of their chemicals to remain secretive. "Secret exposure to chemicals that our own EPA reports as a potential hazard to human health is unconscionable," said Alan Lockwood, MD, of Physicians for Social Responsibility (PSR) to Newsweek. "Healthcare professionals can't possibly treat patients properly, make protective public health plans and decisions, and protect first responders without knowing what chemicals are in the environment." The CDPHE report strengthens Governor Jared Polis' argument that emissions from Colorado's powerful oil and gas industry need to be reined in. The finding also helps explain the complaints 750 residents living near oil and gas facilities made to the state's health department, said state toxicologist Kristy Richardson, as The Denver Post reported. Around 60 percent of those complaints involved symptoms commensurate with chemical exposure, such as headaches, dizziness and difficulty breathing.

Keystone pipeline restarts 2 weeks after North Dakota leak (AP) — Canadian crude oil is once again moving through a pipeline nearly two weeks after the line leaked an estimated 383,000 gallons (1.4 million liters) of oil in North Dakota. Calgary, Alberta-based TC Energy, formerly known as TransCanada, said in a statement that the Keystone pipeline “returned to service” Sunday after approval of a repair and restart plan by the U.S. Pipeline and Hazardous Materials Safety Administration. The company said it is still investigating the cause of the leak it reported Oct. 29 that affected about 22,500 square feet (2,090 square meters) of land near Edinburg, in northeastern North Dakota. “We will operate the pipeline at a reduced pressure with a gradual increase in the volume of crude oil moving through the system,” the company’s statement said. The pipeline is designed to carry about 23 million gallons (87 million liters) daily. The agency ordered the company last week to keep the pipeline shut down until corrective action was taken, including sending an affected portion of the pipe to an independent laboratory for testing. The agency has not responded to an emailed request for comment on Monday, a federal holiday. North Dakota environmental scientist Bill Suess said Monday that an affected portion of the 30-inch (76-centimeter) underground steel pipeline was dug up and replaced “over the weekend.” Suess said cleanup crews remained at the site on Monday. Some wetlands were affected, but not any sources of drinking water, he said. TC Energy has said about 200 people were at the site working around the clock to clean up the spill. The company said about 285,600 gallons (1 million liters) of crude oil has been recovered.

Montana lawmakers seek more time for Keystone XL public, tribal input - (Reuters) - Montana lawmakers representing Native American tribal members called on the state’s congressional delegation and the U.S. State Department on Thursday to extend the public comment period for the environmental review of the Keystone XL pipeline, saying tribes were not properly consulted. “We are particularly concerned with the lack of formal consultation with tribal governments whose natural and cultural resources could be significantly impacted,” the 10 members of the State-Tribal Relations committee wrote to Democratic U.S. Senator Jon Tester, Republican Senator Steve Daines and Republican Representative Greg Gianforte. The letter called for the Trump administration to conduct a “more rigorous and meaningful public comment process” for its draft supplemental environmental impact statement of Keystone XI’s proposed route through northeastern Montana, whose public comment period closes on Monday. The long-pending pipeline would carry heavy crude oil to Steele City, Nebraska, from Canada’s oil sands in Alberta, but has faced legal challenges from landowners, tribes and environmentalists. A federal judge in Montana in August 2018 ordered the State Department to do a full environmental review of a revised route for the Keystone XL oil pipeline. He said the previous environmental analysis fell short of the “hard look” at the cumulative effects of greenhouse gas emissions and the impact on Native American land resources that was required. The environmental impact statement will be the basis for other federal agencies to issue construction permits for construction, including one by the Army Corps of Engineers to allow the proposed line to be built under the Missouri River. Members of the Fort Peck Reservation are concerned that the pipeline would sit beneath the spillway of the Fort Peck dam, which would make it vulnerable to the velocity of water discharge from the dam.

How Money from Big Oil and Pipeline Developers Spills into the Democratic Party - The Democratic Party has a pipeline problem. After deciding to stop taking Big Oil money in 2018, then promptly reversing course, the DNC has all but proven that they value money over anything else — and they clearly don’t care much about where it comes from. The party that prides itself on being the driving force behind the climate change and conservation conversations have ultimately failed in their rhetoric, and more importantly, their actions (or lack thereof). This needs to stop. Indigenous peoples’ sacred lands and water sources are being threatened and destroyed. Our environment is being polluted — the recent Keystone Pipeline leak being the latest example. Over the course of this article, we will explore several of the countries largest pipelines, the companies that own them, and where they put their money. Here’s a clue: Oil money isn’t just for Republicans. The Keystone Pipeline transports about 700,000 barrels of oil per day from the Western Canada Sedimentary Basin in Alberta to refineries in Illinois, Texas, and Ohio. Owned by TC Energy, a subsidiary of TransCanada, the 2,151 mile long pipeline runs through six states (ND, SD, NE, KS, MO, IL), and would add a seventh (MT) if the proposed Keystone XL addition proceeds, as it appears it will. TransCanada, through their PAC, has donated $5,000 each to Rep. Dan Lipinski (D-IL), former Congressional Black Caucus chair Rep. Cedric Richmond (D-LA), and Rep. Richard Neal (D-MA) this year, as well as donating to various other PACs. Lipinski in particular is going to pop up a lot here, as he’s taken $1,000 from Richard Keane, CEO of Kinder Morgan (who has stakes in several pipelines including the Utopia, CalNev, and Plantation Pipelines) and $2,500 from Enbridge’s PAC. Enbridge owns one of the largest pipeline systems in North America, the Enbridge System, a sprawling 3,100 mile long pipeline system that transports over 1.4 million barrels of crude oil across the country, and one that is guilty of several of the largest inland oil spills in American history.

PHMSA chief touts flexible rules, drawing pushback at pipeline safety conference  - The Trump administration's top pipeline safety official made a case for more flexible federal rules, wading into a longstanding dispute among safety advocates, regulators and industry groups at an annual gathering of the stakeholders. On one side of the debate are supporters of prescriptive rules that establish explicit, measurable safety goals for pipeline operators and pathways to achieving them. On the other side are advocates of performance-based standards, which give pipeline operators more latitude to prevent accidents. The chief of the Pipeline and Hazardous Materials Safety Administration said a "purely prescriptive" approach to regulation will never achieve the goal of reducing pipeline accidents to zero. "I don't think this should surprise anyone because, by definition, regulations create and then enforce minimum standards. But zero incidents is a maximum goal that cannot be reached by even perfect conception or enforcement of minimum standards," PHMSA Administrator Skip Elliott told the Pipeline Safety Trust conference in New Orleans on Nov 7. Elliott said there is no magic bullet to achieving that goal, but he believes the path to zero accidents has three elements: developing technological advancements, building a culture of safety and persistence. Creating a pervasive safety culture requires the help of all stakeholders and begins with finding common ground, he said. But comments from safety advocates and other stakeholders at the conference show there is not yet consensus that performance-based rules are more effective than prescriptive regulations.

Minnesota attorney general supports Michigan suit to shut down Enbridge pipeline – Minnesota Attorney General Keith Ellison has filed a brief supporting a lawsuit in Michigan seeking the shutdown of the Enbridge Line 5 pipeline, which starts in Superior, Wis., and runs underwater across the Straits of Mackinac that connects Lakes Michigan and Huron. In a friend-of-the-court brief filed this week with Wisconsin Attorney General Joshua Kaul and California Attorney General Xavier Becerra, they argue that state law, not federal, controls the routing of pipelines. Ellison said in a statement that he joined the brief to support Michigan “in protecting its right to control its underwater land against the federal government’s attempt to pre-empt it. The people of Michigan, who share the Great Lakes with us, have as much of a right to control their underwater land as the people of Minnesota do. By supporting Michigan, I’m protecting Minnesotans.” The filing “expresses no opinion as to whether plaintiff’s claim should ultimately succeed.”  Michigan Attorney General Dana Nessel filed the suit in June in Ingham County Circuit Court, saying the 66-year-old Line 5 pipeline “violates the public trust doctrine, is a common law public nuisance, and violates the Michigan Environmental Protection Act because it is likely to cause pollution impairment and destruction of water and other natural resources.”  Enbridge has asked the court to dismiss the case and said “Line 5 has been safely operating across the Straits for more than 65 years” spokesperson Juli Kellner said in a statement. “There is no change in the operating condition of the pipeline or change in law to support the Attorney General’s position.”  Enbridge said a shutdown of Line 5, which carries up to 540,000 barrels of oil and natural gas liquids per day, would have “immediate and severe consequences” for refineries, jobs and fuel prices in Michigan, Ohio and Ontario. The line begins at the Enbridge terminal in Superior and ends in Sarnia, Ontario, across the Michigan border. The multistate brief filed Tuesday is unusual for a case in state court, though it does address the collision of state and federal powers concerning coastline and public water management. Last month Enbridge won a separate Michigan court case over its plan to build a tunnel below the Straits of Mackinac for a $500 million pipeline replacement it wants to finish by 2024. Nessel has appealed. The Bad River Band of Chippewa has asked the company to move the pipeline off its land in northern Wisconsin; Enbridge has offered $24 million to settle the resulting lawsuit.

Dem AGs file in support of Nessel's Enbridge suit — Democratic attorneys general in California, Minnesota and Wisconsin weighed in Tuesday on the state’s legal spat with Enbridge over the continued operation of Line 5, arguing a state’s public trust of natural resources extends to submerged lands. The U.S. Coast Guard’s general authority in navigable waters and the federal oversight of pipelines fail to preempt the state’s authority over the bottom lands of the Straits of Mackinac, where the dual spans of Line 5 reside, they said. “…the authority includes the power to reject uses of these lands previously allowed by a state,” the filing said. The states filing the brief “have an interest in preserving their long-standing authority over submerged lands, and they submit this memorandum in support of Michigan’s argument that there has been no federal preemption of the public trust doctrine in this case.” The Tuesday filing comes a day prior to filings from Attorney General Dana Nessel and Enbridge Energy in Ingham County Circuit Court, where Enbridge is asking the judge to dismiss Nessel’s case.Nessel asked the court in June for an order to shut down and decommission Enbridge’s 66-year-old pipeline, arguing that the pipeline is a public nuisance and violates public trust and environmental laws. The lawsuit came after years of environmental concerns that a break in the pipeline would yield catastrophic effects in the Great Lakes, similar to a 2010 Enbridge spill near Marshall, Michigan. Republican former Gov. Rick Snyder’s administration reached an agreement with Enbridge last year to build a $500 million tunnel to house the pipeline and protect the straits in the event of a spill. Nessel earlier this year opined the agreement was unconstitutional, but Michigan Court of Claims Judge Michael J. Kelly rejected her technical argument by saying it "misses the mark."  Enbridge purchases land owned by City of Mellen - An Enbridge spokesperson says the company has purchased land owned by the City of Mellen as it evaluates options for re-routing Line 5. In a Mellen City Council meeting on November 5, council members voted to approve the agreement, after rejecting a land survey request by the company last month. In a statement released by Enbridge, Mellen will receive $1 million for the tract, road improvements, a water treatment system solar array and debt retirement, as well as community investments in the city’s school, fire, and emergency services department, and the museum. Company officials say if the Line 5 relocation project is built on the land, the company will make an additional $3.25 million investment in city projects. The company says other routes are still being considered. Enbridge is currently evaluating options for re-routing the line in response to a lawsuit filed by the Bad River Band of Lake Superior Chippewa. The lawsuit asks for the removal of Line 5 off the reservation. Enbridge says they have been operating across Northern Wisconsin since Line 5 was built in 1953, and add the company is happy with the agreement. The full statement can be found below:

This pipeline cuts across a reservation. Wisconsin might make tribal members felons for protesting it.  - For more than 60 years, one section of Enbridge’s elaborate network of pipelines carrying petroleum across Canada has taken a detour through the Bad River Reservation in northern Wisconsin.Some of the easements that allowed Enbridge to keep its Line 5 pipeline on the tribe’s land expired in 2013, and negotiations between Enbridge and the tribe to renew the leases fell through. Yet Line 5 is still funneling Enbridge’s petroleum across the Bad River Reservation. The tribe says Enbridge is trespassing, and hassued the company to kick it off their property.If a bill awaiting Wisconsin’s Democrat Governor Tony Evers’ signature becomes law, members of the tribe protesting Enbridge’s operations on their reservation could face fines of $10,000 and up to six years in jail. “It provides these illegally operating companies with the right to basically charge someone with a felony for being on their land,” said Philomena Kebec, a citizen of Bad River and former tribal prosecutor. “And this could be an Indian person on Indian land where the company is illegally trespassing.”The Wisconsin bill is part of a wave of similar legislation raising penalties for trespassing or damaging oil and gas infrastructure around the country. Support for bills penalizing protestors followed in the wake of the Dakota Access Pipeline protests in North Dakota nearly three years ago. So far, at least eight states have such laws on the books, according to the International Center for Not-for-Profit Law, a watchdog group tracking the legislation, and several others — including Wisconsin, Ohio, and Pennsylvania — are considering similar proposals. Under a 2015 Wisconsin law, trespassing and damaging property owned, operated, or leased by an “energy provider” — mainly electric and gas companies — is a felony. The new bill expands the definition to include companies with petroleum, chemical, and “renewable fuel” infrastructure, a change that would protect the many pipelines that crisscross the state. It has the backing of oil and gas groups, labor unions, and a renewable energy developer, EDP Renewables.

‘It’s Been Stressful’: Propane Shortage Adding To Difficult Harvest For Minnesota Farmers – — Minnesota is now one of eight states under an emergency declaration when it comes to propane. The propane shortage extends across the Midwest, and as far south as Kansas. It can be blamed on a wet harvest and delivery issues caused by early winter weather in some states. A wet fall means propane is needed to dry crops for many farmers before it can be stored. And they can burn through thousands of gallons of propane in a week. That also burns through their pocketbooks. In some cases, propane has been brought in from Nebraska and other states, in order to keep up with corn dryers that are working overtime. Brothers Dan and Daryl Patnode and their sons farm a thousand acres near Loretto. “All the homes and businesses, turkey barns and chicken barns. The demand is there and they are just having a hard time keeping up,” Dan said. They also milk about 140 dairy cows as part of Patnode Dairy. We visited with them in 2013, during a similar harvest, when propane also became issue. A wet spring meant late planting. A wet fall means late harvesting. “Start to finish. It’s been stressful from the get-go. We couldn’t get planting and now it seems like we can’t get the harvest finished up,” Daryl said. On the dairy side of things, the Patnodes need propane to heat their milking parlor. So far they haven’t had to wait for propane. But there’s a concern that with early winter weather things could change, as it already has for other farmers across the Midwest. “Now we are trying to get the crop out and do tillage, but now there is frost in the ground. Six inches of frost,” Dan said. Last year at this time, about 86% of Minnesota corn had been harvested. Right now, we are only at about 63%. But farmers are counting on the next, few days to be dry and warmer so progress can be made. The emergency declaration for propane comes after the natural gas supply for commercial corn dryers was shut off on Monday. It’s part of an effort to keep enough supply on hand for homes and schools.

DAKOTA ACCESS: Pipeline expansion sparks battles in 3 states -- Two years after it started moving oil out of North Dakota, the Dakota Access oil pipeline is asking for permission to nearly double its capacity — touching off the same environmental and regulatory concerns that led to massive protests and a presidential order blocking the project in 2016.

Tribe to argue against expansion of Dakota Access pipeline (AP) — Standing Rock Sioux Tribe members have long maintained that a leak in the Dakota Access oil pipeline would threaten their Missouri River water supply, and on Wednesday they will argue that a new proposal to double the line’s capacity magnifies the probability of a disastrous oil spill. North Dakota regulators will hold a hearing in Linton, a town of 1,000 along the pipeline’s path. The Public Service Commission will take comments from tribe members and other pipeline opponents in the community near where a pump station would be placed to increase the line’s capacity from 600,000 barrels per day to as much as 1.1 million barrels. A barrel is 42 gallons. Texas-based Energy Transfer proposed expanding its pipeline in June to meet growing demand for oil shipments from North Dakota, without the need for additional pipelines or rail shipments. The $3.8 billion pipeline was subject to prolonged protests and hundreds of arrests during its construction in North Dakota in late 2016 and early 2017 because it crosses beneath the Missouri River, just north of the Standing Rock Sioux Reservation. The tribe draws its water from the river and fears pollution. Energy Transfer insists the pipeline and its expansion are safe. The company also plans additional pumping stations in South Dakota, Iowa and Illinois. Commissioners in a South Dakota county last month approved a conditional use permit for a pumping station needed for the expansion. Permits in the other states are pending. The proposed expansion would “increase both the likelihood and severity of spill incidents,” the tribe said in court filings ahead of Wednesday’s hearing, which an administrative law judge will oversee. The company said in court filings that its $40 million pump station built on a 23-acre site would produce only “minimal adverse effects on the environment and the citizens of North Dakota.”

Company: Dakota Access expansion doesn’t increase risk (AP) — Dakota Access pipeline officials argued Wednesday that the company’s proposal to double the line’s capacity does not increase the potential of a failure, a claim that has been long dismissed by opponents of the idea. Texas-based Energy Transfer wants to double the capacity of the pipeline to as much as 1.1 million barrels daily to meet growing demand for oil shipments from North Dakota, and is seeking permission for pump stations to do it. Supporters and opponents of the proposal packed a small-town auditorium in Linton for a field hearing before state regulators considering the next phase of a project that sparked months of sometimes violent protests during its construction. Chuck Frey, a vice president of engineering for Energy Transfer, told North Dakota regulators the pipeline’s expansion “does not increase the risk” of a spill. “I assure the commission we plan to cut no corners on this work,” Frey said. The Standing Rock Sioux Tribe and other opponents have long argued that a leak in the pipeline would threaten the tribe’s Missouri River water supply, and say that increasing pressure magnifies the risk. Standing Rock Sioux Tribal Chairman Mike Faith said increasing the pipeline’s capacity increases the “consequences as well as the likelihood” of an oil spill. Faith told The Associated Press that he doesn’t trust the company’s promise.

Pipeline leak in Williams County impacts cropland - More than 8,000 gallons of oil spilled from a pipeline leak in Williams County and impacted cropland, the North Dakota Department of Environmental Quality reported Wednesday. The incident on a crude oil gathering line operated by Hiland Crude occurred about a mile northeast of McGregor on Oct. 17 and was reported the same day. However, the initial report did not include an estimate of the amount of oil released, the department said. An updated report provided on Tuesday estimates about 192 barrels of oil were released. That equates to 8,064 gallons. You have 3 free articles remaining. Environmental Quality personnel have inspected the site and will continue to monitor the investigation and remediation.

Brine spill reported in Mountrail County -  Brine leaked at a Mountrail County oil well site on Monday, the North Dakota Oil and Gas Division reports. Marathon Oil Co. told the state that 300 barrels, or 12,600 gallons, of the fluid leaked from a valve and piping connection at one of its wells. Brine is saltwater that comes to the earth's surface alongside oil at well sites. All of the barrels that spilled were contained onsite, and all have been recovered, according to the Oil and Gas Division. The incident occurred 10 miles south of New Town.

Climate change solutions: More cities banning natural gas in homes – Fix global warming or cook dinner on a gas stove?That’s the choice for people in 13 cities and one county in California that have enacted new zoning codes encouraging or requiring all-electric new construction.  The codes, most of them passed since June, are meant to keep builders from running natural gas lines to new homes and apartments, with an eye toward creating fewer legacy gas hookups as the nation shifts to carbon-neutral energy sources.For proponents, it's a change that must be made to fight climate change. For natural gas companies, it's a threat to their existence. And for some cooks who love to prepare food with flame, it's an unthinkable loss.Natural gas is a fossil fuel, mostly methane, and produces 33% of U.S. carbon dioxide emissions from electricity generation, according to the U.S. Energy Information Administration. Carbon dioxide is the primary greenhouse gas causing climate change.“There’s no pathway to stabilizing the climate without phasing gas out of our homes and buildings. This is a must-do for the climate and a livable planet,” said Rachel Golden of the Sierra Club’s building electrification campaign. These new building codes come as local governments work to speed the transition from natural gas and other fossil fuels and toward the use of electricity from renewables, said Robert Jackson, a professor of energy and the environment at Stanford University in Palo Alto, California.  “Every house, every high-rise that’s built with gas, may be in place for decades. We’re establishing infrastructure that may be in place for 50 years,” he said.

Forget the Green New Deal: America Is Now an Energy Superpower -  America’s status as the world’s leading energy superpower was just elevated to an even more impressive level as 12 new all-time monthly production records for crude oil and natural gas output were established during August. According to new monthly data released by the Energy Information Administration (EIA) last Thursday (here and here), these are the 12 new production records, summarized in the table above:

  • 1. Natural Gas (8 new records). The US produced more natural gas in August — 111.4 billion cubic feet per day – than in any previous month, and which represented an annual increase of 9.1% compared to last August. New natural gas production records were also established in the states of Texas (14.0%), Pennsylvania (11.3%), Louisiana (21.5%), Ohio (15.8%), West Virginia (18.1%), New Mexico (21.1%) and North Dakota (23.2%), which all had the double-digit percent increases year-over-year show above. Over a longer period of time, the most impressive gains in natural gas production are for Pennsylvania, which experienced a 38-fold increase in gas output since January 2006 when the EIA started reporting state-level production and a 31-fold increase in Ohio’s production over the same period. Pennsylvania and Ohio, along with West Virginia have the fortune of being situated on top of the prolific Marcellus and Utica Shale Formations, which is the largest source of natural gas in the US accounting for almost 30% of America’s total natural gas production (vs. about 25% from Texas).
  • 2. Crude Oil (4 new records). US oil production in August increased by nearly 9% from the same month last year and set a new all-time output record of 12.4 million barrels of oil per day (bpd). New monthly crude oil production records were also established in August for the states of Texas at 5.1 million bpd (13.2% year-over-year increase), North Dakota at 1.4 million bpd (nearly 13% annual increase) and New Mexico at 936,000 bpd (32% increase). The new production records in August for both oil and gas in New Mexico are thanks to the state’s fortunate proximity to the Permian Basin, America’s most prolific oil and gas formation.

David Hughes’ Shale Reality Check 2019  - 1.9 million. 13 trillion. 10 billion. These are the numbers that jumped off the page when I read PCI Fellow David Hughes’s latest “shale reality check” report on the U.S. government’s forecasts of domestic oil and gas production. To elaborate, these forecasts mean that by 2050:

  • 1.9 million new oil and gas wells will need to be drilled;
  • $13 trillion will need to be spent to drill all those wells; and
  • 10 billion barrels of tight oil production will be “missing” from shale plays to meet the reference case forecast for cumulative production.

These are just some of the crazy numbers behind the Energy Information Administration’s (EIA) latest forecasts for U.S. oil and gas production through 2050. Every year, the EIA releases a new forecasts of domestic energy in the coming decades. These forecasts—specifically the “reference case”—are virtually taken to the bank by policymakers, investors, and the mainstream media as the most likely scenario of future production, consumption, and prices. This despite the fact that they are very often wrong and vary tremendously from year to year. Or the fact that for several years now David Hughes has published “reality checks” on the forecasts of tight oil and shale gas production (extracted through “fracking”) found in the Annual Energy Outlook—reality checks that have consistently shown that the EIA’s projections are, to be polite, extremely optimistic. Hughes’s Shale Reality Check 2019  finds that the EIA’s forecasts for major plays like the Bakken, Eagle Ford, Marcellus, Utica, and the Permian Basin are terribly unrealistic. Of the 13 shale plays analyzed, nine are rated as extremely optimistic, three highly optimistic, and only one moderately optimistic. And even with all this optimism, the overall forecast falls short by nearly ten billion barrels of tight oil, or 10% of the production volume required through 2050.

The  EIA Is Grossly Overestimating U.S. Shale - The prevailing wisdom that sees explosive and long-term potential for U.S. shale may rest on some faulty and overly-optimistic assumptions, according to a new report.Forecasts from the U.S. Energy Information Administration (EIA), along with those from its Paris-based counterpart, the International Energy Agency (IEA), are often cited as the gold standard for energy outlooks. Businesses and governments often refer to these forecasts for long-term investments and policy planning. In that context, it is important to know if the figures are accurate, to the extent that anyone can accurately forecast precise figures decades into the future. A new report from the Post Carbon Institute asserts that the EIA’s reference case for production forecasts through 2050 “are extremely optimistic for the most part, and therefore highly unlikely to be realized.”The U.S. has more than doubled oil production over the past decade, and at roughly 12.5 million barrels per day (mb/d), the U.S is the largest producer in the world. That is largely the result of a massive scaling-up of output in places like the Bakken, the Permian and the Eagle Ford. Conventional wisdom suggests the output will steadily rise for years to come. It is worth reiterating that after an initial burst of production, shale wells decline rapidly, often 75 to 90 percent within just a few years. Growing output requires constant drilling. Also, the quality of shale reserves vary widely, with the “sweet spots” typically comprising only 20 percent or less of an overall shale play, J. David Hughes writes in the Post Carbon Institute report. After oil prices collapsed in 2014, shale companies rushed to take advantage of the sweet spots. That allowed the industry to focus on the most profitable wells first, cut costs and scale up production. But it also pushed off a problem for another day. “Sweet spots will inevitably become saturated with wells, and drilling outside of sweet spots will require higher rates of drilling and capital investment to maintain production, along with higher commodity prices to justify them,” Hughes says in his PCI report. In addition, this form of “high-grading” does allow for rapid extraction, but it doesn’t necessarily mean that more oil is ultimately going to be recovered when all is said and done. The same might be true for all of the highly-touted productivity gains, Hughes says. The industry has boosted productivity by drilling longer laterals, intensifying the use of water and frac sand, as well as increasing the number of fracking stages. These productivity improvements are “undeniable,” Hughes writes. However, the “limits of technology and exploiting sweet spots are becoming evident, however, as in some plays new wells are exhibiting lower productivities,” Hughes says.

The US shale revolution won’t stall despite headwinds, global oil experts say - U.S. shale oil production has shown some signs of moderation in recent months and production growth could be slowing, but experts told CNBC at Abu Dhabi’s influential oil & gas summit that the U.S. shale revolution won’t be stopped any time soon. The U.S. is expected to become a net energy exporter in 2020, exporting more energy products ranging from oil to natural gas, than it imports, according to the U.S. Energy Information Administration (EIA). Jason Bordoff, professor and director at Columbia University’s Center on Global Energy Policy and a former adviser to President Obama, told CNBC Monday that he didn’t think that status would be short-lived. “I don’t think the export story will be short-lived, I think the growth in production is going to slow but it’s still growing, so we’re still going to see the U.S. become a net oil exporter and put a lot of barrels on the market and that’s really important,” he told CNBC’s Steve Sedgwick and Hadley Gamble at the Abu Dhabi International Petroleum Exhibition & Conference (ADIPEC) on Monday. The U.S. Department of Energy’s statistics bureau, the EIA, announced back in January that it expected the U.S. to become a net energy exporter in 2020 for the first time ever. It had been a net importer of energy since 1953, the EIA noted in its annual energy outlook which makes projections for the next 50 years. The agency said the U.S. will start exporting more crude oil and petroleum products than it imports by the final quarter of 2020, and then would remain a net oil exporter for years to come. It noted, however, that production would increase per year until 2027 when it would then level off. The net exporter status comes earlier-than-expected as a previous forecast believed it would be achieved by 2022.

Frackers Prepare to Pull Back, Exacerbating a Slowdown in U.S. Oil Growth – WSJ - Shale companies change course as financial pressure mounts; “I don’t think OPEC has to worry that much more about U.S. shale growth”  The U.S. has more than doubled its crude output over the last decade. Much of the growth is due to the Permian Basin of West Texas and New Mexico. WSJ traces the hotspot of North America’s crude oil boom, with a look at challenges that producers in the region face. After pushing U.S. oil and natural-gas production to record levels, some shale companies plan to pump less. The pullback is sharpest among the country’s largest natural-gas drillers. Several producers, including EQT Corp. and Chesapeake Energy Corp., have said during third-quarter earnings that they may shrink output next year.

U.S. oil producers to slash spending for second straight year in 2020 (Reuters) - U.S. energy producers plan to slash spending for a second straight year in 2020 as companies struggle to extract profits from the U.S. shale boom. While U.S. crude output hit a record 13 million barrels per day (bpd) this month, U.S. oil companies have struggled to deliver consistent profits. That is in part due to their success - higher output has kept oil prices tethered. Investor dissatisfaction has spurred companies to rein in their spending for a second year, with capital expenditures among companies that have released budgets set to fall more than 10% in 2020. Despite lower spending, output continues to grow, swelling global supply, and taking market share from the Organization of the Petroleum Exporting Countries, which has had to cut output sharply to accommodate U.S. shale. OPEC Secretary General Mohammad Barkindo said this week that U.S. shale supply could underperform in 2020. However, the International Energy Agency said on Friday that OPEC and its allies face challenges from production growth out of non-OPEC countries led by the United States. Producers expect to spend about $4 billion less in 2019 than in 2018, according to U.S. financial services firm Cowen & Co. So far, 21 exploration and production companies tracked by Cowen have released 2020 capex guidance with 15 projecting declines, five with increases and one unchanged, for a 13% year-over-year spending decline. “All of these companies need to start posting a profit and free cash flow. Investors are demanding it,” said Alex Beeker, analyst with Wood Mackenzie. “You have to cut capex to make that happen.” The spending cuts coincide with expectations for a sharp slowing in U.S. production growth. U.S. oil output is expected to average 12.3 million bpd for 2019, up by 1.3 million bpd from 2018, according to U.S. Energy Department data. The Department of Energy expects 2020 growth at 1 million bpd, but numerous analysts expect slower growth.

OPEC's Barkindo: Shale producers are concerned that their slowdown is becoming a 'fast deceleration' - — OPEC Secretary General Mohammed Barkindo isn’t worried about booming U.S. shale production pushing the oil price down despite a difficult year for the 14-member crude producing organization, which has struggled to keep prices from falling in a low demand environment. Asked about the disruptive impact of U.S. shale on the energy market, and whether the abundant commodity could torpedo OPEC’s efforts to boost prices into the new year, Barkindo cited an impending slowdown in shale — and suggested the most concerned party out of anyone should be shale producers themselves. “Here in ADIPEC, talking to a number of producers, especially in the shale basins, there is a growing concern by themselves that the slowdown is almost graduating into a fast deceleration,” Barkindo told CNBC’s Steve Sedgwick at the annual Abu Dhabi International Petroleum Exhibition & Conference (ADIPEC). “And the numbers are starting to show it. They are the operators, they are the ones investing, and they are telling us that we are probably more optimistic than they are considering the variety of headwind challenges they are facing.” Shale oil, the commodity that catapulted the U.S. to becoming the world’s top energy producer last year and that’s threatened the level of influence OPEC heavyweights have over the market, is indeed set for a slowdown in 2020, recent figures show. U.S. oil rig count dropped by 2% at the end of October to 700, the lowest in two and a half years, according to oil services company Baker Hughes. The industry is facing capital retreat as investors pull away from drilling companies, unwilling to spend more money on unprofitable growth. A recent report by IHS Markit forecasts total U.S. production growth to fall to 440,000 barrels per day (bpd) in 2020 and broadly flatten by 2021 — down from a global record of 2 million bpd annual growth in 2018.

OPEC sees smaller 2020 oil surplus ahead of policy meeting - (Reuters) - OPEC said on Thursday it expected demand for its oil to fall in 2020 as rivals pumped more despite a smaller surplus of crude in the global market, building a case for the group to maintain supply curbs when it meets to discuss policy next month. The logo of the Organisation of the Petroleum Exporting Countries (OPEC) is seen at OPEC's headquarters in Vienna, Austria July 1, 2019. REUTERS/Leonhard Foeger In its last monthly report before the Dec. 5-6 talks, OPEC said demand for its crude would average 29.58 million barrels per day (bpd) next year, 1.12 million bpd less than in 2019. That points to a 2020 surplus of about 70,000 bpd, which is less than indicated in previous reports. The drop in demand could encourage the Organization of the Petroleum Exporting Countries and its allies to keep supply curbs in place when they gather in Vienna. But the report kept its 2020 economic and oil demand growth forecasts steady and was more upbeat about the outlook. “On a positive note, signs of improving trade relations between the U.S. and China, a potential agreement on Brexit after the UK’s general election, fiscal stimulus in Japan, and a stabilization of the downward slope in major emerging economies could stabilize growth at the current forecast level,” OPEC said in the report. The report echoes comments from OPEC Secretary General Mohammad Barkindo, who has said the outlook in 2020 could surprise to the upside, citing prospects for a resolution of the U.S.-Chinese trade row and lower non-OPEC supply.

IEA boosts estimate for 2020 non-OPEC oil supply - -The International Energy Agency raised its 2020 oil production growth estimate for countries outside the Organization of the Petroleum Exporting Countries on Friday, with the U.S. set to continue as the key driver of growth. In its closely-watched oil-market report, the IEA said it expects non-OPEC oil supply growth to rise to 2.3 million barrels a day next year, up from 2.2 million barrels a day in its previous estimate. The agency said heavy oil market inventories and strong market supply would continue next year and that "the U.S. will lead the way but there will also be significant growth from Brazil, Norway and barrels from a new producer, Guyana." That change to the IEA's supply estimate came after the agency said earlier this week in its annual World Energy Outlook that U.S. shale-oil production will reshape global energy markets in the years to come, boosting the country's influence over OPEC nations. The IEA's note also followed OPEC's monthly market report, released Thursday, in which the cartel lowered its own non-OPEC production growth estimate. OPEC and its allies are due to meet in Vienna in December to discuss the status of ongoing supply cuts, and OPEC leaders have been circumspect about whether they may deepen or extend cuts, citing slowing U.S. production growth as a factor. While U.S. growth is expected to slow in 2020--its contribution to non-OPEC growth slipping to 54% from 87% this year--that will be partly mitigated by stronger growth from other countries, the IEA said in its monthly report.

IEA Sees U.S. Shale Squeezing OPEC Influence – WSJ - U.S. shale-oil production will reshape global energy markets in the years to come, bolstering the country’s influence over OPEC nations, the International Energy Agency said Wednesday. But Mohammed Barkindo, secretary-general of the Organization of the Petroleum Exporting Countries, cautioned that growth in American output was slowing and its role remained essential to stabilize oil supplies.

Elizabeth Warren’s fracking ban pledge shows a ‘total lack of understanding,’ oil guru Yergin says— One of the energy industry’s most prominent experts is flabbergasted at Democratic presidential contender Elizabeth Warren’s promise to ban fracking if elected. “The notion just to say I’m going to stop fracking, it is like this all-encompassing term — what are you talking about? I mean really, what are you talking about?” Dan Yergin, the vice chairman of IHS Markit and founder of IHS Cambridge Energy Research Associates asked during the annual Abu Dhabi International Petroleum Exhibition & Conference (ADIPEC) on Monday. “If she’s in the lead then I think that becomes a factor that hangs over oil,” the market veteran and oil historian told CNBC’s “Capital Connection.” “In the U.S., oil production is primarily regulated by the states but there is so much that the federal government can do with a thousand cuts of regulation and so forth … and to just say she’s against fracking shows a total lack of understanding.” “And by the way, this has been one of the most dynamic parts of the U.S. economy — you’re talking about millions of jobs,” Yergin added. “This is just some notion, and they’re not even able to explain what they don’t like about fracking.” Warren and her supporters — and environmentalists as a whole — would disagree. In September Warren, who is a close contender for the top spot on Democratic polls, pledged to put a “total moratorium on all new fossil fuel leases for drilling offshore and on public lands” and “ban fracking everywhere” on her first day in office.

Don't Ban Fracking - Pass A Carbon Tax Instead - The Trump administration’s formal notification that it will abandon the Paris climate agreement should be treated as a huge in-kind contribution to the Democratic Party. It’s an emphatic message to anyone who cares about the planet: Do not, under any circumstance, vote Republican in 2020. The Democrats running for president could not be more starkly opposed to Donald Trump. He mocks climate change as a hoax, wants to dig coal until West Virginia is just a vast cavity in the ground, and thinks the Arctic National Wildlife Refuge should be a safe space for oil rigs. The Democrats recognize scientific reality, favor the Paris climate accord and are committed to curbing greenhouse gas emissions. Some of the candidates, unfortunately, are enamored of the old command-and-control approach to environmental protection: forbidding this and requiring that. Elizabeth Warren, Bernie Sanders and Kamala Harris support a ban on fracking, a method that has greatly increased U.S. oil and gas production. Almost all the candidates would end new oil and gas leases on federal lands. Raising vehicle fuel economy standards and setting a deadline for all vehicles to achieve zero emissions are common ideas. These proposals all suffer from the same flaw: dictating purported solutions from on high, with little regard for side effects, instead of devising incentives for creative, inexpensive remedies. This approach guarantees that the cost will be higher than necessary and results worse. It appeals to politicians, though, because it allows the illusion that major progress can be made without any sacrifice by voters, except maybe those who frack for a living. The assumption is that if people realize environmental improvement is not cost-free, they will run screaming from the room. That theory has prevailed for decades. So I am startled but pleased to discover that this year, many Democratic candidates have decided to treat voters as intelligent people who can be persuaded to embrace optimal remedies. The best of all is a carbon tax, which would raise the price of different fossil fuels to reflect the harm they do. Among the candidates who favor it are Sanders, Warren and Harris, as well as Joe Biden, Pete Buttigieg, Amy Klobuchar and Julian Castro. It would advance these purposes without draconian regulations, inflexible bans or cumbersome bureaucracy. The money collected could be rebated to every American — yielding a net tax increase of zero.

Officials responding to oil spill from cargo ship in Hawaii - The U.S. Coast Guard says a cargo ship has spilled oil into Honolulu Harbor. Coast Guard Petty Officer 2nd Class James Connor says local and federal officials are working on cleanup Thursday after a 433-foot (132-meter) container ship spilled oil a day earlier during a fueling operation.  It is not immediately clear how much oil spilled or how much fuel the vessel holds. It's owned by the U.S. shipping company Matson Inc. Absorbent material was placed around the ship and about 120 gallons of oil has been recovered so far. A Coast Guard flight confirmed oil has leaked outside a containment area and is washing ashore across the harbor on Sand Island. Officials say there are no reports of wildlife being injured.

Ransomware attack at Mexico's Pemex halts work, threatens to cripple computers - (Reuters) - A ransomware attack hit computer servers and halted administrative work on Monday at Mexican state oil firm Pemex, according to employees and internal emails, in hackers’ latest bid to wring ransom from a major company. Hackers have increasingly targeted companies with malicious programs that can cripple systems overseeing everything from supply chains to payments to manufacturing, removing them only after receiving substantial payments. An internal email seen by Reuters said Pemex was targeted by “Ryuk,” a strain of ransomware that experts say typically targets companies with annual revenue between $500 million and $1 billion. “We are taking measures at the national level to fight RYUK ransomware, which is affecting various Pemex servers in the country,” a company official said in an email on Sunday. The attack is the latest challenge for embattled Pemex, already struggling to pay down massive debt, reverse years of declining oil production and fend off potential downgrades of its credit ratings. Pemex said in a statement late on Monday that attempted cyber attacks the day before were “neutralized” in a timely matter and affected less than 5% of its computers.

Pope joins anti-fracking crusade as more pressure comes on Shannon LNG project - Limerick Leader - FIRST it was the environmentalists and An Taisce. Then came heavy hitters like Mark Ruffalo aka The Hulk, documentary maker Michael Moore. Now Pope Francis and Cher have added their names to those opposed to fracking and to the proposed Shannon LNG plant at Tarbert Ballylongford. But, John Fox, PRO for Tarbert Development Association, is adamant that local support remains strong for the project, first proposed in 2006 and now being spearheaded by the US-based New Fortress Energy. “The problem with fracked gas, we firmly believe, is that it is a matter for the sovereign government of the USA,” he said. “They put a man on the moon. Surely they have the capacity and capability to resolve the fracking problem. As far as we are concerned, the Irish government says the gas coming in meets the European standard for gas. The country of origin should be satisfied they are doing no harm to their citizens or their environment. They should address their issues.” Mr Fox was speaking to the Limerick Leader just days after a photograph of Pope Francis appeared on social media, holding an anti-fracking t-shirt, alongside anti-fracking activist, scientist and fellow Argentinian, Esteban Servat. Servat, who sparked a huge anti-fracking movement in Argentina when he published a secret government study showing the pollution of water supplies from fracking and who was forced to flee his country, visited Pope Francis in the Vatican.

The Inevitable Finale Of The Nord Stream 2 Saga - Europe is quickly becoming one of the most important export destinations for gas exporters. Production is decreasing quickly due to political and technical developments. The next few decades are promising for exporters. Nord Stream 2 is arguably one of the most contentious projects currently under development. Denmark recently granted the last necessary permit to start construction activities in its EEZ and analysts now agree that the project’s completion is only a matter of time. In reality, the pipeline’s future was decided long before construction even started due to external factors such as Poland’s decision to diversify away from Russian gas and Western Europe’s determination to turn away from nuclear and fossil fuel production.  The availability and transportation of natural gas are determined by the relative distance between consumers and the production area. A general rule of thumb is that for a distance smaller than 4,000 km or 2,500 miles pipelines are more economic while LNG is more economic for distances larger than that. Political factors, however, trump financial and technical logic. The safety of supply is valued more by countries such as Poland who opt for more expensive alternatives such as the Baltic pipeline. Historically, the European energy market is dominated by Russia due to its proximity and massive energy reserves. Siberian gas is the most obvious choice from an economic point of view. Politics, however, are what currently dominates the natural gas industry. With that in mind, the persistent support for Nord Stream 2, NS2, by Western European countries and companies, most notably Germany, may appear strange. But a more in-depth look at energy politics in the region and domestic developments, in general, provide somewhat of an answer.European production is decreasing dramatically, primarily due to the depletion of old gas fields. Also, political motives hamper production such as in the Netherlands where tremors, allegedly due to gas extraction, have reduced political support for the industry. Europe’s biggest single gas deposit, the Groningen field in the Netherlands, will cease operations in 2022. The closure of this gas giant was another reason to support the construction of NS2. Poland is one of the staunchest opponents of NS2. The Eastern European country argues that Moscow is trying to divide Europe by circumventing traditional transit countries in the east and increasing dependency of the wealthier west, primarily Germany. Warsaw though has financial motives to oppose the project because Gazprom is aiming to export its gas directly to Germany instead of through what it considers more “unreliable” countries such as Ukraine and Poland. This measure will cost Eastern Europe billions in lost transit fees every year. Poland is diversifying suppliers by constructing a subsea pipeline from Norway through the Baltic sea. Denmark recently granted a permit to construct the infrastructure in its EEZ. The pipeline is planned to come online before 2022 when Poland’s import contract with Gazprom ends. 

ADNOC Makes LNG Supply Deals with BP and Total - Abu Dhabi National Oil Co. (ADNOC) reported Tuesday that it has signed supply agreements with units of BP plc and Total S.A. In a written statement emailed to Rigzone, the firm noted the supply deals effectively book out the majority of its liquefied natural gas (LNG) production through the first quarter of 2021 and gives its ADNOC LNG subsidiary access to new markets. “With these new supply agreements, ADNOC LNG has shown that it can react quickly and decisively to changing market conditions while ensuring the security and quality of delivery,” stated Fatema Al Nuaimi, CEO of ADNOC LNG. “With the support of our shareholders, we have maximized access to new markets with strong LNG growth potential.” ADNOC owns a 70-percent stake in ADNOC LNG, which produces approximately 6 million tons per annum of LNG at its complex on Das Island 99 miles (160 kilometers) offshore Abu Dhabi. Other ADNOC LNG shareholders include Mitsui & Co. (15 percent), BP (10 percent) and Total (five percent). ADNOC called the supply agreements with BP and Total “milestones,” applauding ADNOC LNG’s success in transitioning to a multi-customer marketing strategy implemented in April of this year. The company pointed out the new strategy has enabled it to shift from supplying 90 percent of its LNG molecules to a single utility customer in Japan to supplying 90 percent of its LNG molecules to a range of clients and receiving terminals in more than eight countries across southern and southeast Asia. The Japanese utility “remains an important customer,” ADNOC added.

South Sudan villagers relocated after oil leak -  More than 2,000 South Sudanese villagers reportedly have been relocated following an oil spill in a remote part of Northern Liech state. Gatkouth Ruach says he and other villagers were moved to a different part of the state after a pipeline burst Nov. 7 in Budang County. State Health Minister Kur Yai Nop denied anyone was relocated, saying there are no human settlements near the affected area. "The people who are staying there are oil company staff. There is no community there, they are very far," Nop told VOA's South Sudan in Focus. But Ruach told a different story. "When the leak happened, those who are in the area were relocated to another place from the oil-spilled area. Some of them are taken to Laloba, and others [were taken] to a place called Thirty Mile," he told South Sudan in Focus. Ruach said his village was flooded with crude oil and many families and cattle were affected by the spill. "People are staying close to it and with their cattle. It is affecting people, causing diarrhea and other diseases. Up to this week, the oil is full on the ground. Cattle are playing in it and children as well, and the children are now suffering," Ruach told VOA. The ruptured pipeline is owned by Greater Nile Pioneer Operating Company, a Chinese-owned company that has refineries in Khartoum and Port Sudan. 

Egypts environmental agency files complaint due to Red Sea - The Red Sea Regional Branch of the Egyptian Environmental Affairs Agency (EEAA) in Hurghada will file a legal complaint against the General Petroleum Company (GPC) in Ras Ghareb for polluting the Ras Ghareb Corniche Beach with crude oil and harming the environment, environmental activists said on Sunday. The agency will file the complaint to the Red Sea Prosecution to investigate, the activists added. The technical report’s results claimed that the crude oil footprint taken from the Ras Ghareb Beach matched with the company’s crude oil. The activists said that the branch will assign the technical committee to identify the financial compensations which the company will pay for the crude oil pollution. The EEAA has continued its oil pollution control work, which includes cleaning the oil spots along the one-kilometer Ras Ghareb Corniche Beach, fearing that the pollution will extend to further areas and harm the environment. Crude oil spills re-emerged on November 6 on the Ras Ghareb Corniche beach, which has been the site of petroleum pollution from crude oil in several areas. A committee of environmental researchers from the Red Sea moved to the pollution site, obtained a sample of the spill, and sent it to the laboratories of the Environmental Affairs Agency in Suez to determine the spill’s source, in order to carry out legal action amid calls from Ras Ghareb citizens to stop the frequent oil pollution on the city’s shores. The Environment Ministry announced on July 5 that it spotted a crude oil spill covering 1,500 meters off the coastal area of Ras Ghareb, north of the Red Sea governorate, and declared a state of emergency while cooperating with the Petroleum Ministry to determine the spill’s source. The marine environment protection societies warned against the recurrence of the oil pollution crisis, as it poses a grave danger to the environment through causing the death of marine life and polluting diving areas and coral reefs.

6 killed in fire caused by oil spill in northern Egypt - At least six people were killed and 15 others injured in a fire caused by the leakage of an oil pipeline in Beheira Province north of the capital Cairo, the Egyptian Ministry of Health said in a statement.The ministry sent 20 ambulances to the scene and moved the wounded to nearby hospitals, according to the statement, Xinhua news agency reported.The Ministry of Petroleum said on Wednesday that the leakage was caused by a failed theft attempt that left a hole in the pipeline which led to oil spill in and around a canal in a Al-Mawasir village of Beheira''s Itay el-Baroud city.Beheira''s senior officials said crowds of villagers rushed to the site of the oil spill and the later fire resulted in casualties among them. "The fire was completely contained and extinguished," Secretary-General of Beheira Province Hazem al-Ashmouny told the Egyptian state TV, offering condolences to the families of the victims.

Iran discovers new oil field with over 50 billion barrels (AP) — Iran has discovered a new oil field in the country’s south with over 50 billion barrels of crude, its president said Sunday, a find that could boost the country’s proven reserves by a third as it struggles to sell energy abroad over U.S. sanctions. The announcement by Hassan Rouhani comes as Iran faces crushing American sanctions after the U.S. pulled out of its nuclear deal with world powers last year. Rouhani made the announcement in a speech in the desert city of Yazd. He said the field was located in Iran’s southern Khuzestan province, home to its crucial oil industry. Some 53 billion barrels would be added to Iran’s proven reserves of roughly 150 billion, he said. “I am telling the White House that in the days when you sanctioned the sale of Iranian oil and pressured our nation, the country’s dear workers and engineers were able to discover 53 billion barrels of oil in a big field,” Rouhani said. Oil reserves refer to crude that’s economically feasible to extract. Figures can vary wildly by country due to differing standards, though it remains a yardstick of comparison among oil-producing nations. Iran currently has the world’s fourth-largest proven deposits of crude oil and the world’s second-largest deposits of natural gas. It shares a massive offshore field in the Persian Gulf with Qatar. The new oil field could become Iran’s second-largest field after one containing 65 billion barrels in Ahvaz. The field is 2,400 square kilometers (925 square miles), with the deposit some 80 meters (260 feet) deep, Rouhani said. Since the U.S. withdrew from the 2015 nuclear deal, the other countries involved — Germany, France, Britain, Russia and China — have been struggling to save it. However, they’ve offered no means by which Iran can sell its oil abroad. Any company or government that buys Iran’s oil faces harsh U.S. sanctions, the threat of which also stopped billions of dollars in business deals and sharply depreciated Iran’s currency, the rial.

Saudi Arabia raises October oil output to replenish inventories - (Reuters) - Saudi Arabia raised its oil output in October to 10.3 million barrels per day but kept its supply to the oil markets below its OPEC output target, a Saudi industry source familiar with the kingdom’s oil operations told Reuters. Saudi Arabia, the world’s largest oil exporter, told OPEC that its production in September fell by 660,000 barrels per day (bpd) from August to 9.13 million bpd in the wake of attacks on its energy installations. Oil supply to the markets stood at 9.890 million bpd in October, the Saudi source said, adding that the 400,000 bpd difference between production and supply was moved to inventories. “Saudi Aramco (is) replenishing its inventories, which it earlier drew upon during September 2019, in order to supply the needs of its customers despite being subject to the most serious act of aggression in the history of the industry,” the source said.

Saudi Aramco will offer less than 1% of shares to individual investors in IPO - Saudi Aramco will sell up to 0.5% of its shares to individual investors in what could be the largest initial public offering in history. The world’s biggest oil company released a prospectus Saturday, providing further information but without revealing the precise size of its planned share offering. Saudi Aramco said the process begins Nov. 17 and closes Dec. 4. A final offer price, as well as the number and percentage of company shares that will be sold, will be determined at the end of that period. The prospectus says individual investors will have until Nov. 28 to request shares, noting that “up to 0.5%” of the company’s shares will be allocated to individual investors. Saudi Aramco confirmed plans to pay annual, aggregate cash dividends of at least $75 billion starting in calendar year 2020, in addition to any special dividends. However, investors can’t yet gauge the value of those dividends’ yield relative to other companies until they can clearly assess the valuation of Saudi Aramco and its shares. Dividend investors are attracted to steady returns, and they try to put their money into stocks with the best yields. Exxon Mobil shares have a dividend yield of 4.92%, based on their Friday closing price of $70.77 per share. Chevron’s yield stands at 3.94%, and BP comes in at 6.28%. The Saudi government will face a lockup period of six months on further sales of shares after Aramco’s public offering. The IPO is being underwritten by J.P. Morgan, Goldman Sachs, Citigroup and Morgan Stanley, among others. Aramco said last week that it plans to float its shares on the Saudi Stock Exchange — known as the Tadawul — in December. Analysts’ valuations of the company have varied from $1.2 trillion to $2.3 trillion. In comparison, Aramco’s closest U.S. rival, Exxon Mobil, has a market cap of nearly $300 billion and Chevron is valued at about $229 billion. The much-anticipated IPO was first flagged in 2016 by the government of Saudi Arabia, and has faced multiple delays, reportedly amid concerns its finances would be publicly scrutinized. Drone attacks on its key oil facilities in September also raised worries about security and threatened to jeopardize its planned listing.

Saudi Aramco unveils IPO prospectus, will sell up to 0.5% of shares to individual investors -  — Saudi Arabia’s state-owned oil giant Aramco released a lengthy document late Saturday that lays the ground for investors to buy into the world’s most profitable company, but it remains unknown how much is on offer. In its preliminary prospectus, Aramco revealed that it will sell up to 0.5% of its shares to individual retail investors. It did not indicate how much will be made available to institutional investors. Still, the highly-anticipated sale of even less than 2% of the company has been generating global buzz because even a sliver would make this the world’s biggest initial public offering. Read: Here’s what investors need to know about Saudi Aramco’s landmark IPO Saudi Aramco is the kingdom’s oil and gas producer, pumping more than 10 million barrels of crude oil a day, or some 10% of global demand. Despite questions over Aramco’s valuation and how much of the company will ultimately be for sale on Saudi Arabia’s Tadawul stock exchange, the company’s size and profitability has made it undeniably attractive to potential investors. The oil and gas company netted profits of $111 billion last year, more than Apple, Royal Dutch Shell and Exxon Mobil combined. Trading on Saudi Arabia’s domestic exchange could begin as soon as Dec. 11, according to state-linked media. Aramco does not appear to have any immediate plans to list more of the company on an international exchange, although there have been talks with major exchanges in recent years. In the roughly 650-page prospectus, Aramco said the offering period for investors will begin Nov. 17. It will close for individual investors on Nov. 28 and for institutional investors on Dec. 4. Aramco will price its shares on Dec. 5, according to the document. The company stated its plans to pay out an annual dividend of at least $75 billion starting in 2020, but questions linger over how much Aramco is worth. Crown Prince Mohammed bin Salman priced the company’s value at $2 trillion, but analysts estimate the value is closer to $1.5 trillion.

Saudi Aramco stock could price at volatile time for the oil market - The initial public offering of Saudi Arabia’s big oil company could be priced right in the middle of what could be a volatile period for oil.Saudi Aramco intends to price its IPO on Dec. 5, the same day OPEC begins its regular two-day meeting in Vienna. The Aramco stock, equal to 0.5% of the company, is expected to trade on the Saudi Tadawul Exchange several days later, and market talk has focused on Saudi Arabia’s desire for higher and steadier prices.Saudi Arabia Crown Prince Mohammed bin Salman has been looking for a $2 trillion value for Aramco, but bankers have said it is worth more like $1.5 trillion. Aramco said the company is worth $1.5 trillion at an oil price of $45; $1.76 trillion at $65, and $2.1 trillion at $75 per barrel, according to reports.Analysts say there could be conflicts at OPEC’s meeting this year,. Saudi Arabia has been trying to rein in producers, such as Iraq and Nigeria, which are not complying with the production cuts OPEC agreed to with Russia and others. Some traders expect the agreed cuts of 1.2 million barrels a day to be increased, but Saudi Arabia is reportedly not in favor of changing the target until at least March, when the agreement runs out. “Obviously, the biggest thing that’s going to decide where crude prices go in the next two or three weeks is going to be the OPEC meeting,”   “It looks like Russia is being a little bit antsy and not willing to move, and you have the Aramco IPO is pretty much intertwined with that meeting,” said Bradley. Underwriters are expected to run a book-building process between Nov. 17 and Dec. 4, during which time institutional investors will be expected to submit orders.’

Saudi Arabia's Final Attempt To Boost Aramco's Valuation - Saudi Arabia is gearing up for the Aramco IPO, pulling out all the stops to boost the company’s valuation. But it’s a desperate attempt that is riddled with risk. Saudi Arabia is reportedly bullying the ultra-rich in the country to invest their money in the offering, a pressure campaign that has echoes in the 2017 Ritz-Carlton shakedown.Aramco is also dangling the possibility of larger-than-advertised dividend payouts to investors. “Aramco management has stressed the possibility of additional distributions to shareholders above and beyond the minimum dividend pledge,” Bank of America Merrill Lynch said in a report for investors seen by the Financial Times. Higher dividends would be made possible by borrowing, while the notion is also hinged on some optimistic assumptions on higher oil prices and steady increases in free cash flow.But major banks are still not coming through for Aramco, putting valuation ranges on the company well below the $2 trillion figure that Crown Prince Mohammed bin Salman wants. “This is marketing material,” one banker told the FT, referring to the optimistic assumptions that Aramco is peddling regarding future oil prices.Bank of America, for instance, says the company may be worth between $1.2 and $2.3 trillion, which, to be fair, would still produce a staggering number, although the range the bank offered is nebulously large. Related: How Much Oil Is Up For Grabs In Syria?Some press reports suggest that MbS has come around to the idea of a lower valuation, perhaps in the range of $1.7 trillion. But, again, even that revised number could be overly optimistic. The danger is that the IPO flops and the share price slides, burning investors along the way. China may invest $5 to $10 billion in the company, but from China’s perspective, the investment serves geopolitical goals arguably as much or more than any financial outcome.Ultimately, there are large questions surrounding the unique nature of Aramco, huge profits notwithstanding. The Abqaiq attack highlighted geopolitical risks to the company’s operations, revealing that a sizable portion of the country’s assets could be knocked out essentially overnight by an unexpected attack. That certainly has to be factored into the valuation of the company.Meanwhile, Aramco can make promises to investors, but at the end of the day, t he company and its shareholders would be entirely at the mercy of the King and his political goals, leaving little to no legal recourse for investors.

The Middle East is launching a new oil benchmark to rival WTI and Brent - The Abu Dhabi National Oil Company (Adnoc) and nine of the world’s largest energy traders have partnered with the Intercontinental Exchange (ICE) to set up the world’s first Murban crude oil futures contracts. ICE Futures Abu Dhabi (IFAD) and ICE Murban futures are slated for launch in early 2020, subject to regulatory approvals, and will seek to rival well-established light crude oil benchmarks WTI and Brent. Among the companies joining state-owned Adnoc, which produces around 1.7 million barrels of Murban crude daily, to take stakes in the new oil bourse are energy behemoths BP, Shell, Total, PetroChina and Vitol. Murban is a light crude grade, a substantial proportion of which is exported from Fujairah via the Gulf of Oman, with Abu Dhabi’s overall production currently standing at around 3 million barrels a day. Adnoc Group CEO and UAE Minister of State Sultan Ahmed Al Jaber said in a statement Monday that “having a new, independent exchange in Abu Dhabi will not only benefit the UAE, but also physical and financial oil traders around the world.” IFAD will also be competing with the Dubai/Oman benchmark, operated by Dubai Mercantile Exchange (DME). The development could shake up the pricing of oil in the region. While most Middle Eastern oil producers use rates in the futures market as a basis for oil pricing, Adnoc has historically priced retroactively. “The futurization of Murban cargoes will act as a boon for buyers because it will allow them to know what they are paying in advance,” . “This is in contrast to the current retroactive pricing mechanism. What is more, buyers should now benefit from more hedging opportunities in the future markets.”

EU Majors Take Stakes in Abu Dhabi Oil Bourse -- BP Plc, Royal Dutch Shell Plc, Total SA and Vitol Group are among partners in a new exchange to trade Abu Dhabi’s flagship oil grade in what could become a new price benchmark for a fifth of the world’s crude. Intercontinental Exchange Inc. Chairman Jeffrey Sprecher confirmed the partnerships, speaking on Monday to reporters in Abu Dhabi. Other partners in the exchange are Petrochina Co., Inpex Corp. and JXTG Holdings Inc. of Japan, PTT Pcl of Thailand, and South Korea-based GS Caltex Corp., he said. Although oil producers across the Persian Gulf pump about a fifth of the world’s oil, they have never had a region-wide, exchange-traded crude benchmark. Adnoc wants the Murban futures contract to become a benchmark for crude from the Middle East, the world’s biggest oil exporting region. Abu Dhabi National Oil Co. will join major international oil companies, traders and customers as founding partners in a platform operated by ICE for the trading of futures contracts in Abu Dhabi’s flagship Murban crude, Adnoc Chief Executive Officer Sultan Al Jaber said in a speech earlier Monday. Murban futures will allow buyers to hedge in the open market, he said. Trading Start Murban crude futures are likely to begin trading around June, and are set to be the benchmark for other Abu Dhabi grades, Al Jaber said in an interview after ICE’s announcement. ICE will be a majority shareholder in the Abu Dhabi futures exchange, he said.

UAE oil benchmark plan confused by Brent comment U-turn - (Reuters) - A United Arab Emirates plan to launch its own global oil benchmark was thrown into confusion on Tuesday after comments made by its own national oil company. ADNOC first said it sees Murban as a contract to replace the global Brent benchmark, only to retract the comment. The development highlights a complex nature of Abu Dhabi National Oil Company’s (ADNOC) Murban futures contract. It will be traded on a new local exchange, ICE Futures Abu Dhabi (IFAD), that will be co-owned by Abu Dhabi, several oil majors and the Intercontinental Exchange Inc, which is also home to Brent trading. “We want to give the industry Murban as a replacement for Brent crude futures,” Philippe Khoury, the head of trading at ADNOC, told Abu Dhabi’s main annual oil show. He said Brent production volumes were declining. The industry has long complained about falling North Sea production which makes Brent illiquid and vulnerable to manipulations. But ADNOC later retracted Khoury’s comment and changed it to “our ambition is for the market to use Murban as a price marker alongside Brent crude futures, the global benchmark for oil”. ADNOC said it was retracting the comments because they did not reflect the company’s position.

OPEC+ Risks Oil Slump Below $50 - With their next meeting just weeks away, OPEC and its partners are showing no impetus for stronger action to support oil prices. But without intervention, some influential forecasters say a new supply glut could send the market crashing early next year. Crude prices, trading at about $62 a barrel in London, may tumble almost 30% to $45 a barrel if the Organization of Petroleum Exporting Countries and its allies don’t announce deeper production cutbacks, according to Morgan Stanley. Citigroup Inc. and BNP Paribas SA predict a slide to the low $50s. That would intensify the strain on group members like Venezuela, Iran and Iraq, which are already reeling from economic crises and political unrest. It would also ripple through the rest of the industry, hitting the shale boom that has transformed the U.S. into the world’s biggest oil producer. “The prospect of oversupply looms over the market in 2020,” said Martijn Rats, global oil strategist at Morgan Stanley. “Either OPEC deepens its cuts, or prices will fall to about $45 a barrel, and force a slowdown in U.S. shale that balances the market.” Oil supplies from outside OPEC are set to expand twice as fast as global demand next year, as a fragile economy crimps consumption while new supplies flood in from the U.S., Norway and Brazil, the group’s data show. If Saudi Arabia, Russia and others who reined in production this year don’t deepen the cutbacks when they meet in Vienna on Dec. 5 to 6, prices will almost certainly weaken, the banks say. While OPEC Secretary-General Mohammad Barkindo said the group and its partners are prepared to do “whatever it takes” to prevent another rout, delegates say that the biggest producers in the coalition aren’t pushing for further reductions. Oman’s Oil Minister Mohammed Al Rumhy said on Tuesday the group will likely stick with current output levels. The Saudis appear to have little appetite for further sacrifices. The kingdom had already cut output more than twice as deep as initially foreseen in October, while others in the alliance -- particularly Iraq and Nigeria -- haven’t delivered on their commitments, according to data compiled by Bloomberg. Russia faces less budgetary pressure than its OPEC counterparts and thus less urgency to act.

The One Factor Driving Today's Oil Markets - Oil continues to seesaw on every rumor (positive or negative) regarding the U.S.-China trade war. As a result, a lot of attention will be paid to President Trump’s speech today at the New York Economic Club, where he may provide more clues into what to expect next. Markets are betting on an easing of tariffs.  . Saudi Arabia ratcheted up oil production to 10.3 mb/d in October, although it supplied 9.89 mb/d to the market, with the rest diverted into storage in order to rebuild inventories after the Abqaiq attack.  Bolivian President Evo Morales stepped down (or was ousted in a coup, depending on one’s point of view), and is seeking exile in Mexico. The political turmoil could descend into deeper violence. Royal Dutch Shell, Total, and Respol “have all stopped or severely limited drilling on exploration wells,” Bloomberg reported. There isn’t evidence that existing production has been affected, but new drilling has been suspended for now. . A warmer-than-expected weather forecast for the U.S. winter from the National Oceanic and Atmospheric Administration led to a selloff in U.S. natural gas prices. As a result, share prices of major shale gas producers fell sharply. EQT. the largest gas producer in the U.S., saw its share price plunge by 9 percent on Monday. The forecast comes even as freezing temperatures have swept over much of the continent. Low prices are hitting the entire gas sector hard. Iran said that it has discovered a giant oil field in the country’s south, a field that may hold as much as 50 billion barrels of oil. That is almost as big as all of the reserves held in the U.S., which stands at around 61 billion barrels.

2019 Marks Nadir of Oil Demand Growth - This year will mark the nadir of oil demand growth over the next five years, according to a new report from Fitch Solutions Macro Research (FSMR). “We forecast demand to grow by around 0.5 percent this year, rising to 0.8 percent in 2020. While this puts our growth forecasts signi´Čücantly below consensus, it is consistent with the excessive weakness we have seen in monthly data in the year to date,” FSMR analysts stated in the report. “Demand has faced a perfect storm of global macro headwinds, fueling broad-based weakness from the top down, and a host of idiosyncratic barriers to growth, dragging on demand at the individual market level,” the analysts added. In the note, FSMR analysts noted that developing markets in Asia had been an “outlier” and continued to post strong demand growth this year. “While India and China have dominated in volume terms, growth has been fairly broad-based across the region,” the analysts stated. “In contrast, developed markets – which have enjoyed some cyclical boosts to growth in recent years – are falling back into structural decline,” FSMR analysts added. According to OPEC’s latest world oil outlook report, which was published earlier this month, global oil demand will hit 1.14 million barrels per day (MMbpd) in 2019 and 2020. This will then drop to 1.03 MMbpd in 2021, 970,000 barrels per day (bpd) in 2022, 920,000 bpd in 2023 and 850,000 bpd in 2024. In the International Energy Agency’s (IEA) latest oil market report, which was released last month, the organization forecasts oil demand growth of 1 MMbpd in 2019 and 1.2 MMbpd in 2020. In July, the IEA revealed that oil supply exceeded demand by 900,000 bpd in the first half of 2019.

Global oil demand growth to slow from 2025-IEA - (Reuters) - Global oil demand growth is expected to slow from 2025 as fuel efficiency improves and the use of electrified vehicles increases but is unlikely to peak in the next two decades, the International Energy Agency (IEA) said on Wednesday. The Paris-based IEA, which advises Western governments on energy policy, said in its annual World Energy Outlook for the period to 2040 that demand growth would continue to increase even though there would be a marked slowdown in the 2030s. The agency’s central scenario - which incorporates existing energy policies and announced targets - is for demand for oil to rise by around 1 million barrels per day (bpd) on average every year to 2025, from 97 million bpd in 2018. Demand is then seen increasing by 0.1 million bpd a year on average during the 2030s to reach 106 million bpd in 2040. “There is a material slowdown after 2025, but this does not lead to a definitive peak in oil use,” the IEA said, citing increased demand from trucks and the shipping, aviation and petrochemicals sectors. Oil use in passenger cars is, however, seen peaking in the late 2020s as drivers switch to electric vehicles.

Oil Prices Fall Amid Mixed Sino-U.S. Trade War Signals - Oil prices fell on Monday in Asia after U.S. President Donald Trump said trade talks with China are moving along “very nicely,” but denied reports from last week that the two sides have agreed to roll back on some existing tariffs on each others’ goods. U.S. Crude Oil WTI Futures fell 0.9% to $56.71 by 1:10 AM ET (05:10 GMT). International Brent Oil Futures also dropped 0.9% to $61.91. Oil prices surged almost 10% since early October amid reports at the time that suggested China and the U.S., the world’s biggest oil imports, were moving closer to a partial trade deal. Also weighing on the market were data over the weekend that showed that China's producer prices fell the most in more than three years in October. In other news, OPEC Secretary-General Mohammad Barkindo said last week that the outlook of oil market for 2020 may have upside potential, suggesting that there is no need to cut output further. The OPEC+ alliance agreed last year to cut output by 1.2 million barrels per day since January until March 2020 in order to boost oil prices.

Oil slips as trade worries offset Cushing drawdown - (Reuters) - Oil prices edged lower on Monday as little progress on U.S.-China trade negotiations kept prices pressured, but bullish inventory data in the United States offered some support.  Brent crude LCOc1 futures lost 33 cents to settle at $62.18 a barrel, after falling to $61.57 earlier in the session. U.S. West Texas Intermediate (WTI) crude CLc1 fell 38 cents to settle at $56.86 a barrel. Investors are worried about fallout from the 16-month U.S.-China trade war, which has slowed economic growth around the world and prompted analysts to lower forecasts for oil demand, raising concerns that a supply glut could develop in 2020. “We expect the sideward trading to continue for the time being, with the trade conflict headlines likely to dictate the direction,” Commerzbank said in a note. U.S. President Donald Trump said on Saturday that trade talks with China were moving along “very nicely” but the United States would only make a deal if it was the right one for America. Trump also said there had been incorrect reporting about U.S. willingness to lift tariffs as part of a “phase one” agreement, news of which had boosted markets. Underlining the impact of the trade war, data over the weekend showed that China’s producer prices fell the most in more than three years in October.

Oil Prices Climb, Reversing Early Losses Before Trump Speech - Oil prices climbed on Tuesday, reversing early losses amid hopes that U.S. President Donald Trump would use a speech later in the day to indicate progress towards resolving the protracted U.S.- China trade war. Trump will speak at 12 PM ET (1700 GMT) at the Economic Club of New York, and investors are keen for an update on the trade talks with China after recent reports indicated that the mooted ‘phase-1’ deal may not be finalized until December. Prices had come under pressure on Monday amid concerns over slower economic growth and the outlook for oil demand due to the fallout from the 16-month trade conflict between the world’s two largest economies. Brent crude, the global benchmark, was up 30 cents at $62.48 a barrel by 08:07 AM ET (01:07 GMT), after falling as low as $61.90. U.S. crude futures were 13 cents higher at $56.96 per barrel. "The oil market is in a holding pattern," said Tamas Varga of oil broker PVM. "The next $5-$10 move will be decided by economic and trade considerations." Trump "is widely expected to delay his decision to impose tariffs on European car and auto part imports and will also shed further light on the status of the trade negotiations with China," Varga added. "Market participants continue to believe in a (partial) trade agreement to be signed soon," said Carsten Fritsch, analyst at Commerzbank. "Increasing doubts about this would put oil prices under pressure." Oil prices were also underpinned by U.S. data showed that crude inventories at Cushing, the delivery point for WTI, fell by about 1.2 million barrels in the week to Nov. 8, traders said, citing market intelligence firm Genscape.

Oil pares gains on US-China trade doubts - Oil prices steadied after rising about 1% on Tuesday following a speech from U.S. President Donald Trump that offered few new details about Washington’s trade talks with Beijing. Concerns about slower economic growth and oil demand due to the fallout from the 16-month trade dispute between the world’s two biggest economies pressured oil. Brent crude futures, the global benchmark, fell 8 cents to settle at $62.10 a barrel. West Texas Intermediate (WTI) crude shed 8 cents to settle at $56.80 a barrel. Prices eased from earlier gains after Trump’s remarks to a lunch gathering of The Economic Club of New York included mixed messages about U.S.-China trade talks and excluded specifics about any progress in negotiations. The U.S. president said on Saturday that talks with China were moving along “very nicely” but the United States would make a deal only if it was the right one. He said there had been incorrect reporting about U.S. willingness to lift tariffs. Prices received earlier support from U.S. data that showed crude inventories at Cushing, the delivery point for WTI, fell by about 1.2 million barrels in the week to Nov. 8, traders said, citing market intelligence firm Genscape. Inventories at the hub were expected to draw down after a more than 9,000-barrel leak forced the 590,000-barrel-per-day Keystone crude pipeline to be shut in late October. The line has since been restarted at reduced pressure. Cushing inventories had grown for five weeks in a row through Nov. 1, according to government data. However, crude stockpiles nationwide were forecast to have risen last week for a third week in a row, a preliminary poll ahead of government data due on Thursday showed. Weekly energy data has been delayed a day due to the Veterans Holiday on Monday. Brent has risen 16% in 2019, supported by a supply-limiting pact by the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia. The producers meet on Dec. 5-6 to decide whether to extend the deal.

Oil steadies after Trump dashes hopes on trade deal details - (Reuters) - Oil prices ended Tuesday little changed after paring gains of about 1% following a speech from U.S. President Donald Trump that offered few new details about Washington’s trade talks with Beijing. Concerns about slower economic growth and oil demand due to the fallout from the 16-month trade dispute between the world’s two biggest economies have weighed on crude futures. Brent crude futures ended the session down 12 cents at $62.06 a barrel after trading between $62.85 and $61.82. West Texas Intermediate (WTI) crude futures settled down 6 cents at $56.80 a barrel. Prices pared earlier gains after Trump’s remarks to a lunch gathering of The Economic Club of New York included mixed messages about U.S.-China trade talks and excluded specifics about any progress in negotiations. Trump said U.S. and Chinese negotiators were “close” to a “phase one” trade deal, but largely repeated well-worn rhetoric about China’s “cheating” on trade. Earlier, prices received support from data that showed crude inventories at Cushing, the delivery point for WTI, fell by about 1.2 million barrels in the week to Nov. 8, traders said, citing market intelligence firm Genscape.

Oil edges up ahead of US storage data as OPEC, Fed see robust economy Oil prices edged up on Wednesday after the Organization of the Petroleum Exporting Countries said it saw no signs of global recession and rival U.S. shale oil production could grow by much less than expected in 2020. Also supporting prices were comments by Federal Reserve Chair Jerome Powell, who said the U.S. economy would see a “sustained expansion” with the full impact of recent interest rate cuts still to be felt. “The baseline outlook remains favorable,” Powell said. Brent crude futures gained 31 cents to settle at $62.37, having fallen by over 1% earlier in the day. U.S. West Texas Intermediate crude settled at $57.17 per barrel, gaining 32 cents or 0.6%. Analysts said WTI was up more than Brent ahead of storage data from the U.S. Energy Information Administration (EIA) on Thursday that is expected to show a supply draw at the Cushing hub in Oklahoma and a smaller than normal increase in total U.S. crude stocks. “We look for WTI to be better supported than the rest of the complex ahead of tomorrows weekly EIA report,” Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois, said in a report. OPEC Secretary General Mohammad Barkindo said global economic fundamentals remained strong and that he was still confident the United States and China would reach a trade deal. “It will almost remove that dark cloud that had engulfed the global economy,” Barkindo said, adding it was too early to discuss the output policy of OPEC’s December meeting. He also said some U.S. companies were now saying oil production would grow by just 0.3-0.4 million barrels per day next year - or less than half of previous expectations - reducing the risk of an oil glut next year. U.S. President Donald Trump said on Tuesday Washington and Beijing were close to finalizing a trade deal, but he fell short of providing a date or venue for the signing ceremony. “The expectations of an inventory build in the U.S. and uncertainty over the OPEC+ strategy on output cuts and U.S./China trade deal are weighing on oil prices,” In the United States, analysts forecast crude oil inventories climbed 1.6 million barrels last week, which would be the third weekly increase in a row, according to a Reuters poll on Tuesday. That compares with a 10.3 million barrel build during the same week in 2018 and a five-year average increase for the week of 3.7 million barrels.

WTI Extends Gains After Surprise Crude Draw - Oil price rebounded after three days lower after a report that OPEC sees a potential reduction in supply from outside of the group. When the OPEC news hit the market, prices “started to rally from the red to the green,” said Bob Yawger, future divisions director for Mizuho Securities in New York. “Until this turnaround, things were getting ugly.”  And now all eyes are on inventories... API:

  • Crude -0.5mm (+1.5mm exp)
  • Cushing -1.2mm
  • Gasoline +2.3mm
  • Distillates +0.8mm

A surprise crude draw and the end of the streak of Cushing builds corresponds with an end to the streak of draws in products... WTI had rallied on the day and hovered around $57.25 before the data. Once API reported the surprise draw, WTI jumped higher...

WTI Slides After Surprise Crude Build, New Record Production  - Oil prices extended gains overnight after API reported a surprise crude draw and OPEC’s top official talked about the potential for a “sharp” slowdown in American shale output next year.“Today, the market will focus on the release of official U.S. oil statistics by the Energy Information Administration,” said Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas SA in London.“As usual, the mood ahead of the EIA release is being set by the preliminary numbers released by the API the day before.”Of course, all that enthusiasm could evaporate if inventories are seen surging...  DOE:

  • Crude +2.22mm (+1.5mm exp)
  • Cushing -1.229mm
  • Gasoline +1.861mm
  • Distillates -2.477mm

Completely reversing last night's API-reported draw, official data shows a bigger than expected 2,.22mm crude inventory build,  While OPEC hopes for a decline, US crude production surged to a new record high despite the collapse in rig counts.

Oil falls on larger-than-expected US inventory -- Oil prices fell on Thursday as U.S. crude futures were pressured by a build in domestic inventories and record production, while forecasts from the Organization of the Petroleum Exporting Countries for a lower-than-expected oil surplus supported Brent. Brent futures fell 7 cents to settle at $62.30 per barrel, while West Texas Intermediate crude futures fell 35 cents, or 0.6%, to settle at $56.77. U.S. crude stockpiles grew last week by 2.2 million barrels, compared with analysts’ expectations in a Reuters poll for a 1.649 million-barrel rise, as production hit a record high, the Energy Information Administration said. “It’s really about the inventory report today,” said Phil Flynn, an analyst at Price Futures Group in Chicago. “The build in crude oil supply was a bit of a disappointment.” Crude production rose by 200,000 barrels per day (bpd) to a weekly record of 12.8 million bpd, the EIA said in its weekly report delayed a day by Monday’s U.S. Veterans Day holiday. “We might be over-producing a bit and leaving it sitting in the storage tanks,” said Ryan Kaup, a commodities broker at CHS Hedging. The market earlier rose about 1% after OPEC pointed to a smaller surplus in the oil market next year although it still expects demand for its crude to drop as rivals pump more. OPEC Secretary General Mohammad Barkindo also said on Wednesday that there would likely be downward revisions of supply going into 2020, especially from U.S. shale. Barkindo said it was too early to say whether further output cuts would be needed. The drop in demand could press the case for the exporter group and partners like Russia to maintain supply curbs at a meeting on Dec. 5-6.

Oil Markets Ignore Worrying OPEC Projections - It was a big week for oil market data and projections this week, with both OPEC and the IEA releasing some key reports for the industry. Despite this influx of new data, oil is set to close out the week little changed from a week earlier. It was a relatively quiet week in terms of volatility, with the U.S.-China trade war maintaining its firm grip over oil markets. Weak demand and rising non-OPEC supply presents a “major challenge” to OPEC next year, according to a new report from the IEA. The agency said that non-OPEC supply could grow by 2.3 mb/d in 2020, higher than the 1.8 mb/d this year. As a result, demand for OPEC’s oil will decline by around 1 mb/d. “The hefty supply cushion that is likely to build up during the first half of next year will offer cold comfort to OPEC+ ministers gathering in Vienna at the start of next month,” it added. . The European Investment Bank announced on Thursday plans to end financing for fossil fuel projects around the world, a decision that will take effect in 2021. In the interim, only projects currently in the works will go forward. Instead, the EIB said it would unlock 1 trillion euros ($1.1 trillion) for climate change action. “We will stop financing fossil fuels and we will launch the most ambitious climate investment strategy of any public financial institution anywhere,” said EIB President Werner Hoyer. The EIB is the world’s largest multilateral lender.  Minnesota’s Attorney General, Keith Ellison, has joined a lawsuit in Michigan to shut down Enbridge’s Line 5 pipeline. Offshore oil production could hit a peak in 2020 before entering decline. After supply additions next year, a dearth of new projects go forward, according to a report from Sanford Bernstein. For investors, the opportunity is huge because there is a scenario in which industry spending falls but oil prices rise. The recent failed auction in Brazil lends some weight to the theory that the industry might stay away from future offshore spending. OPEC+ is likely to extend its production cuts through the end of 2020 at the upcoming meeting in Vienna, rather than deepening the cuts. “There is always a risk that if we cut deeper and prices rise, those [U.S.] companies could change their plans to hike production,” a Gulf OPEC delegate told the Wall Street Journal. “OPEC would ensure that won’t happen.”  Famed activist investor Carl Icahn is pressuring Occidental Petroleum to sell some of its assets after the $38 billion takeover of Anadarko Petroleum. The IEA released its highly-anticipated annual World Energy Outlook this week, complete with forecasts to 2040. The agency said that oil demand will likely plateau in the 2030s, but emissions are still on track to rise through 2040. The IEA also saw U.S. shale growing strongly through 2030, nearly doubling in output, despite the current slowdown.

Oil rises on hopes for OPEC supply curbs, new optimism on US-China trade deal --Oil prices rose on Friday as OPEC’s outlook for oil demand next year fueled hopes that the producer group and its associates will keep a lid on supply when they meet to discuss policy on output next month. Optimism that the United States and China could soon sign an agreement to end their trade war also seeped into the market after White House economic adviser Larry Kudlow said a deal was “getting close,” citing what he called very constructive discussions with Beijing. Brent crude futures were up 28 cents, or 0.5%, at $62.56 a barrel by 0441 GMT, having dropped 9 cents on Thursday. West Texas Intermediate crude was up 28 cents, or 0.5%, at $57.05 a barrel, after falling 0.6% in the previous session. The rosy mood came after the Organization of the Petroleum Exporting Countries (OPEC) said on Thursday it expected demand for its oil to fall in 2020. Many analysts said that supports the view among markets that there’s a clear case for the group and other producers like Russia — collectively known as ‘OPEC+’ — to maintain limits on production that were introduced to cope with a supply glut. But such a move may backfire, according to Jonathan Barratt, chief investment officer at Probis Group. “If you push prices higher it is going to hurt everyone and even if it doesn’t, it’s only going to play into the U.S. producers’ hands.” OPEC+ on Jan. 1 cut output by 1.2 million barrels per day (bpd), and in July, the alliance renewed the pact until March 2020. OPEC said demand for its crude would average 29.58 million barrels per day next year, 1.12 million bpd less than in 2019. That points to a 2020 surplus of about 70,000 bpd, which is less than indicated in previous reports. In the U.S., production keeps rising although there was a bigger-than-expected increase in U.S. stockpiles and rising production last week, something that would often lead investors to sell. Crude production rose by 200,000 bpd to a weekly record of 12.8 million bpd, the EIA said in its weekly report. U.S. crude inventories grew last week by 2.2 million barrels, the Energy Information Administration said, exceeding the 1.649 million-barrel rise forecast by analysts in a Reuters poll.

Oil prices hit 2-month high, close at $57.72 - Possible good news about the U.S.-China trade war sent crude prices to their highest level in nearly two months as that good news outweighed reports of record high U.S. oil production and rising crude stockpiles. West Texas Intermediate on the New York Mercantile Exchange rose 95 cents, or 1.7 percent, to close at $57.72 per barrel Friday. The increase gave prices a 0.8 percent advance for the week. The posted price was raised $1 to $54.25 a barrel. However, prices have fallen about 13 percent since late April. Natural gas prices ended the week about 5 cents higher, gaining 4 cents Friday to close at $2.688 per Mcf.  The Organization of Petroleum Exporting Countries has indicated it won’t cut output deeper to stave off the impending surplus and predicts worldwide supplies will exceed demand by about 645,000 barrels a day in the first half of next year. Meanwhile, the International Energy Agency said soaring production outside OPEC and high inventories will keep consumers comfortably supplied next year.  U.S. crude output increased by 200,000 barrels a day to 12.8 million a day last week, according to Energy Information Administration data released on Thursday. While nationwide crude inventories rose, stockpiles at the key storage hub at Cushing, Oklahoma, declined for the first time in six weeks.

Oil prices gain 2% despite concerns about rising supplies (Reuters) - Oil futures gained nearly 2% on Friday as comments from a top U.S. official raised optimism for a U.S.-China trade deal, but worries about increasing crude supplies capped prices. Brent crude gained $1.02, or 1.6%, to settle at $63.30 a barrel, while West Texas Intermediate crude rose 95 cents, or 1.7%, to settle at $57.72 a barrel. Both benchmarks posted their second straight weekly gain. Brent rose 1.3%, and WTI gained 0.8%. U.S. Commerce Secretary Wilbur Ross said in an interview on Fox Business Network that there was a very high probability the United States would reach a final agreement on a phase one trade deal with China. “We’re down to the last details now,” Ross said. U.S.-China trade talks were set to continue with a telephone call on Friday. A monthly report from the International Energy Agency weighed on prices, after it estimated that non-OPEC supply growth would surge to 2.3 million barrels per day (bpd) next year compared with 1.8 million bpd in 2019, citing production from the United States, Brazil, Norway and Guyana. “Today’s monthly IEA release offered some bearish aspects in the form of an unexpected upward adjustment in non-OPEC oil supply growth for next year that briefly forced WTI values to below yesterday’s lows,” said Jim Ritterbusch, president of Ritterbusch and Associates. OPEC Secretary General Mohammad Barkindo had painted a more upbeat picture earlier this week, saying growth in rival U.S. production would slow in 2020, although a report by the group had also said demand for OPEC oil was expected to dip. The Organization of the Petroleum Exporting Countries said demand for its crude would average 29.58 million bpd next year, 1.12 million bpd less than in 2019, pointing to a 2020 surplus of about 70,000 bpd.

Oil Prices Higher for the Week - West Texas Intermediate (WTI) and Brent crude oil finished higher Friday, also showing week-on-week increases. The December WTI contract gained 95 cents Friday, settling at $57.72 per barrel. The light crude marker peaked at $57.97 and bottomed out at $56.43. Compared to the Nov. 8 close, WTI is up less than one percent. January Brent settled at $63.30 per barrel, reflecting a $1.02 gain. For the week, Brent is up 1.3 percent. Both the WTI and Brent grades exhibited “topsy-turvy” behavior during the holiday-shortened trade week, Tom Seng, Assistant Professor of Energy Business with the University of Tulsa’s Collins College of Business, told Rigzone. “Competing and conflicting signals kept the market on its toes as the week started out lower then rose, fell again and rallied higher today,” Seng said. “The market continues to react to statements about the progress or, a lack thereof, on a trade deal between the U.S. and China. Today’ White House Chief Economist Larry Kudlow pronounced that there are positive signs coming out of the negotiations.” Meanwhile, Seng observed that oil market players are looking toward next month’s OPEC+ meeting where the cartel and its associates are expected to agree to maintain current output levels through 2020. “The current quota caps expire in March, and the bigger question is whether or not Saudi Arabia will keep further cuts – seen as a move to help bolster its recent initial public offering,” he explained. “OPEC sees future demand for their oil dropping by 1.1 million barrels per day (bpd) and may seek further cuts to output to stabilize prices. However, in their 2019 World Oil Outlook, the cartel also sees declining global production, citing a slowdown in U.S. shale production as a factor, among others.” The International Energy Agency (IEA), in its annual World Energy Outlook Report, states that – even with slowing U.S. shale oil production growth – the U.S. will still lead global production growth and affect the market share that OPEC and Russia now control, added Seng.  Seng also noted this week’s Weekly Petroleum Status report from the U.S. Energy Information Administration (EIA) showed:

  • A 2.2 million-barrel increase in domestic commercial crude inventories for last week – higher than the 1.5 million-barrel increase projected by Wall Street Journal analysts and significantly greater than the 541,000-barrel build reported Tuesday by the American Petroleum Institute
  • Total crude oil stored at 449 million barrels, or three percent higher than the five-year average for this time of year
  • A 1.2 million-barrel dip in oil stocks at the key Cushing, Okla., storage hub, lowering the total to 46.5 million barrels (approximately 60 percent of capacity)
  • A 1.2-percent increase in refinery utilization to 15.9 million bpd, or 87.8 percent of capacity
  • An 18.8-percent year-on-year drop in oil imports
  • U.S. oil production at 12.8 million bpd – a full 1.1 million-bpd higher than the year-ago rate

Oil is a ‘broken barometer’ and ‘lagging indicator’ of Middle East tensions, energy expert says - Oil is a “broken barometer” and a “lagging indicator of Middle East stress,” according to Helima Croft, managing director and global head of commodity strategy at RBC Capital Markets. Investors are underestimating supply-side risks, Croft told CNBC at the Abu Dhabi International Petroleum Exhibition & Conference on Monday. “We have a market that is singularly focused on the demand side; the whole idea that Chinese demand is going to go off a cliff,” said Croft, a closely-watched oil market expert. But China’s crude oil imports are resilient, she added. In October, crude oil imports into China rose 11.5% from a year earlier to a record high, Reuters reported. However, investors have been spooked by the fallout from the U.S.-China trade dispute and a global economic slowdown, leading to a broader market selloff and lackluster oil prices, Croft said. At the same time, they are also brushing off supply risks in the Middle East. “They’re looking at the Middle East saying ‘it’s noise, we’ve seen this before, even when we had the type of attacks which are almost unprecedented in this market. They are thinking ‘well, we can get over this, we have U.S. production and we have demand worries,’” she said. Considering U.S. sanctions on Iran, current oil prices are “amazing,” said Croft. The market is “basically saying ‘we are swimming in oil, it doesn’t matter; someone can fill every supply gap,’” she added. But there are considerations surrounding the oil market that present supply uncertainty, said Croft. Aside from geopolitical issues in the Middle East, any potential change in the U.S. presidency could also reshape the U.S. energy landscape, as well as the country’s approach toward Iran’s nuclear program, she said.

Yemen war: Saudi Arabia’s desperation could lead to the end of the conflict - The Yemen war is about to come to an end. A Saudi official admitted this week for the first time since 2016 that Riyadh is in talks with the Houthi rebels. The talks have surfaced despite the Houthis being in charge of the capital Sanaa and the other most populous parts in Northern Yemen, which indicates that the Saudis are coming to terms with this status quo. The radical approach of effectively flushing the Houthis out of the north has been abandoned. The new approach of accepting the Houthis as part of the new post-war reality in Yemen, on the other hand, is much more sophisticated. Saudi Arabia seems more open to some kind of coexistence with the Houthis in north Yemen through taking control over them from Iran. After signing the Riyadh power-sharing agreement between the separatist Southern Transitional Council and the UN-recognised government in Aden, Saudi Arabia and the UAE seem to be ready to move on to the next phase of their gouty war in Yemen. Instead of the endless fighting, Saudi Arabia is trying to convince the Houthis to sever ties with its regional rival, Iran. After all, all the Houthis want is legitimacy of their new strategic posture in Yemen. This, in their view, must be cited in a similar power-sharing agreement that guarantees their share in a federation-like new system that includes president Abedrabbo Mansour Hadi’s government and separatists in the south.The attack on the Saudi Aramco oil installations in September, which knocked out half of the Kingdom’s production, was a tipping point. This week, Aramco launched an initial public offering (IPO) to be listed on the local stock market, abandoning Mohamed bin Salman’s original plan to list it on overseas markets. The escalation with Iran began to have a direct effect on the Saudi economy. Moreover, the Yemen war is historic as it exposed Saudi Arabia’s national and geopolitical weaknesses. Besides the big holes in its defence strategy, Saudi Arabia has found itself vulnerable on an unprecedented level. Throughout the last two years (especially after Bashar al-Assad had appeared to be heading towards a decisive victory over his opponents in Syria) Iran has been clenching its fist on Iraq, the Levant and Yemen. This means effectively flanking Saudi Arabia from the north and south.

Iran Is Blowing Past Enriched Uranium Limits, New IAEA Report Confirms -- The nuclear watchdog responsible for policing the Iran nuclear deal, the International Atomic Energy Agency (IAEA), confirmed in a report Monday that Iran has started enriching uranium at its underground Fordow site, in but the latest escalation in a trend which shows no sign of the sanctioned country slowing down on its vow to blow past limits set by the 2015 JCPOA.   According to the IAEA's quarterly report, Iran's enriched uranium levels and its purity "remain above the deal's limits" after months ago Iran's leaders threatened do to just this unless Washington lifts its crippling sanctions, which have left the country struggling to export its oil.  "Tehran is also enriching with more advanced centrifuges and enriching at Fordow, which the deal forbids," Reuters reports of the new findings.  This after early last week the country’s nuclear chief Ali Akbar Salehi announced on state television Iran is launching a new array of 30 advanced IR-6 centrifuges, bringing the total number to 60 IR-6 advanced centrifuges, in violation of its commitments under the nuclear deal.   Leaders in Tehran are currently feeling emboldened after President Hassan Rouhani made public in a speech on Sunday the discovery of a new oil field with over 50 billion barrels of crude in the country's south.  But despite having the world's fourth-largest proven deposits of crude oil, now set to increase by one-third based on estimates of the new crude find in Khuzestan province, Iran has struggled to evade Washington sanctions on its energy sector and sell to other countries. Even China, once seen as a major purchaser through which Iran could weather the US "maximum pressure" storm, has also found its sanctions busting companies the target of White House punitive actions.  Underscoring the urgency of the situation, IAEA officials on Monday said "it is essential for Iran to continue interactions with the agency," after Iran also expanded its number of centrifuges enriching uranium at Natanz facility, in what could soon see the nuclear program enter a point of no return.  Specifically, according to IAEA figures cited in Bloomberg, the Islamic Republic's enriched uranium stockpile rose 65% in the last quarter to 372kg, though the deal officially restricts this to no more than 300kg. In terms of purity Iran is now believed enriching up to level of 4.5%, while the deal permits 3.67%.

European concerns raise prospect of renewed U.N. sanctions on Iran - (Reuters) - Europe’s threat to trigger a mechanism that could reimpose United Nations sanctions on Iran marks a significant breakdown in diplomacy to try to save the 2015 nuclear deal and could presage its death knell, diplomats say. Britain, France and Germany have sought to salvage the pact, under which Iran undertook to curtail its uranium enrichment program in return for relief from sanctions crippling its economy, since the United States withdrew last year. But the three European powers have failed to make good on the trade and investment dividends promised to Iran under the deal as they have been unable to shield Tehran from renewed U.S. sanctions that have strangled its vital oil trade. That has prompted Iran to renege step by step from its non-proliferation commitments under the deal. The U.N. nuclear watchdog (IAEA) confirmed on Monday that Iran had resumed enriching uranium in its underground Fordow plant and was rapidly accelerating enrichment with a variety of advanced centrifuge machines also banned by the deal. The move has alarmed European powers that had previously dismissed Tehran’s breaches, such as exceeding the cap on stockpiles of enriched uranium and on the fissile purity of enrichment, as insignificant and reversible. Britain, France, and Germany raised the prospect of a restoration of international sanctions for the first time late on Monday after a meeting of foreign ministers in Paris, saying they were ready “to consider all mechanisms ... including the dispute resolution mechanism”.

Iraqi forces capture major Baghdad bridges from protesters - — Iraqi security forces cleared three flashpoint bridges in Baghdad of anti-government protesters on Saturday, using stun grenades and tear gas amid heavy clashes, while three more protesters were killed in the southern city of Basra overnight. Mass protests erupted in Baghdad and across southern Iraq last month, calling for the overhaul of the political system established after the 2003 U.S.-led invasion. The demonstrations and a heavy-handed security response have resulted so far in more than 250 deaths. In the capital, demonstrators were pushed back under clouds of tear gas from the Sinak bridge to the nearby Khilani square, where 35 people were wounded, according to medical officials who spoke on condition of anonymity in line with regulations. Security forces moved on to regain control of two other bridges nearby, Ahrar and Shuhada. The bridges span the Tigris and give access to the heavily fortified Green Zone, the seat of government. Protesters have tried to force their way across on an almost daily basis. The day before, authorities found a bomb under the Sinak bridge, and carried out a controlled explosion of it, according to state television. In the southern city of Basra, three more protesters were killed overnight, raising to eight death toll since Thursday. Clashes with security forces also led to wounded in other parts of southern Iraq, including the city of Nasiriyah, according to security officials. The demonstrators complain of widespread corruption, lack of job opportunities and poor basic services, including regular power cuts, despite Iraq’s vast oil reserves. They have rejected government proposals for limited economic reforms, and instead called on the country’s political leadership to resign, including Prime Minister Adel Abdul-Mahdi.

Iraqi forces advance towards central Baghdad, kill at least five protesters  - Iraqi security forces killed at least five people on Saturday as they pushed protesters back towards their main camp in central Baghdad, using live ammunition, tear gas and sound bombs, police and medics said. The clashes wounded scores more people and put security forces back in control of all except one major bridge linking the Iraqi capital's eastern residential and business districts to government headquarters across the Tigris river, Reuters said. The government promised reforms aimed at ending the crisis. Prime Minister Adel Abdul Mahdi said on Saturday that political parties had "made mistakes" in their running of the country, recognised the legitimacy of protest to bring about political change and pledged electoral reform. AFP correspondents saw people shot in the chest collapse to the pavement, while the booms of stun grenades and tear gas rang out. 'We can hear live fire now and there are so many wounded' - Doctor "The security forces are getting closer to us, but the protesters are trying to hold them off by burning tyres," a doctor in Tahrir Square told the AFP news agency. "We can hear live fire now and there are so many wounded." One protester said that the security forces had instructed the protesters to “go home". "We put up more barricades so they won't enter Tahrir. Tomorrow, no one goes to work," he said.

Iraq protests death toll rises to 319 with nearly 15,000 injured - At least 319 people have been killed in Iraq since the start of anti-government protests in October, according to the Iraqi Parliamentary Human Rights Committee. Four protesters were killed in Baghdad on Saturday after Iraqi Security Forces pushed back hundreds of protesters and burnt several tents that were being used for an overnight sit-in, according to Iraqi activists. Teargas and live ammunition was used by Iraqi security forces in the al Khalani commercial area, about 1 kilometer from Tahrir square -- Iraq's ground zero for demonstrations. According to the Independent High Commission for Human Rights of Iraq nearly 15,000 have also been injured. The higher death toll also includes two people who were killed Friday in the southern city of Basra during violent protests, the IHCR said in a statement. Basra is an oil-rich city located some 450 kilometers (280 miles) south of Iraq's capital Baghdad. Another 100 people were wounded in Basra as Iraqi security forces used teargas and live bullets. At least 23 students were also injured in Nasiriyah Sunday, after a tear gas cannon from Iraqi forces mistakenly went off inside a nearby intermediate school for girls, witnesses told CNN. Hundreds of high school students were marching the streets in a fresh round of protests in the city, located south of Baghdad. Witnesses say Iraqi security forces began to use tear gas on the protesters when one of the tear gas cannons went off inside the school for girls. The condition of the students were not immediately clear and authorities have not officially commented on the incident.

America is ignoring Iraq's turbulent protests at its peril, security experts say - Iraq is descending into its most violent days since the battle against ISIS concluded in late 2017 — and the world is completely underestimating its significance, regional experts told CNBC at the Middle East’s premier oil and gas conference this week. “From a security perspective, I would say that the Iraq story is the most under-covered story in the region right now,” Amos Hochstein, former special envoy for international energy affairs under the Obama administration, told CNBC on Wednesday. “Because the forces that are outside, the external forces that have decades of interest (in Iraq) are not going to go away quietly. They will affect the economics of the region potentially, and they can affect the security beyond the region of Europe and eventually the United States.” Some 300 people have been killed and more than 2,000 injured as protests rocking the country of 38 million draw a harsh response from state security forces and other unidentified entities. Authorities have taken extreme measures like shutting down the internet and using live ammunition against protesters in an attempt to crack down on the uprising. Amnesty International has described the government response as “nothing short of a bloodbath.” Protesters report plainclothes snipers shooting and killing civilian demonstrators, with many Iraqis pointing to Iranian-backed paramilitary fighters or “anonymous thugs” as some of the forces sowing further violence and confusion. Iraqis across the country, particularly in Baghdad and cities of the country’s oil-rich south, are angry over grievances that lie at the heart of protests similarly taking place in Lebanon and Algeria: rampant state corruption, high unemployment, and a lack of basic services provision. Iraqi cities regularly suffer power cuts, garbage is left uncollected and there is a broad consensus that the state serves the interests of the elites, not the people — and all this in a country that is a major crude oil producer, sitting on the world’s fifth-largest proven oil reserves and pumping nearly 5 million barrels per day. Its southern Basra province, afflicted with some of the worst poverty and lack of public services in the country, hosts international oil hegemons like Exxon, BP and Total.

Turkey starts repatriating IS jihadis - Turkey began returning captured militants from the extremist "Islamic State" (IS) group to the countries they come from on Monday.  The spokesperson for the Interior Ministry, Ismail Catakli, said on Monday that a US national had been deported and a German and a Danish national would be returned later in the day. The two are being held in deportation centers while legal proceedings are under way. Catakli said seven other German nationals would be returned on November 14. "One American foreign terrorist fighter whose proceedings are completed has been deported, Catakli was quoted as saying by state-run Anadolu news agency.  "Travel plans for seven foreign terrorist fighters of German origin at deportation centers have been completed; they will be deported on November 14," he added. A German Foreign Ministry spokesperson confirmed on Monday that Turkey would be sending up to seven IS fighters along with two children. Ankara is also preparing to deport foreign fighters from France, Ireland and the Netherlands, among other countries, Catakli noted. In total, over 20 jihadists are expected to be deported in the coming days, including 11 French and two Irish nationals.   The move comes days after the Turkish interior minister, Suleyman Soylu, said his country was "not a hotel for IS members from any country." He also warned that Ankara would begin repatriation even if the prisoners had their citizenships revoked. However, it is not clear whether this will be possible.

US Drones Capture Footage Of Pro-Turkish Forces Engaged In Shocking War Crimes -  Entirely to be expected, a new report in The Wall Street Journal has found that Turkish-backed Syrian forces currently fighting US-backed Kurdish groups as part of 'Operation Peace Spring' are guilty of war crimes, including summary executions of Kurdish civilians. "U.S. military officials watched live drone feeds last month that appeared to show Turkish-backed Arab gunmen targeting civilians during their assault on Kurdish fighters in northeastern Syria, attacks the Americans reported to their commanders as possible war crimes, according to current and former U.S. officials familiar with the incidents," reports the WSJ.  What the report fails to mention, however, is the blatantly obvious and relevant recent history that the Islamist militants carrying out such atrocities are the very same militants which were a few short years ago funded, armed and trained by the CIA and Pentagon.  Erdogan's proxy ground invasion force known as the Turkish-backed Free Syrian Army (TFSA), more commonly called the Syrian National Army, has even recently been filmed deploying CIA-supplied TOW missiles against the Kurdish-led Syrian Democratic Forces (SDF), as we previously detailed.It's also been well-documented that the Turkey invasion forces of Syrian National Army are stacked with former ISIS, Nusrah, and FSA jihadists... who clearly brought their CIA toys with them. And oh the Pentagon now wants you to know that US officials have suddenly become aware of their war crimes, despite the very same groups having carried out similar crimes against Syrian civilians for years as they fought pro-Assad forces.

Turkey’s Other Weapon Against the Kurds: Water - Since the early 2000s, a massive hydropower project in southeastern Turkey has been mired in controversy, moving forward in fits and starts. But as of this past July, construction is finally complete. As the dam and its reservoir become fully operational, the line between hydropower and state power will be washed away. This fall, the violence that followed a sudden, destabilizing withdrawal of US troops from nearby northern Syria captured the world’s attention as it cleared the path for Turkey’s military to dominate the Kurdish opposition. Meanwhile, the water slowly rising behind the 442-foot-high, more-than-a-mile-wide wall of the Ilisu Dam across the Tigris River is a less overt sign of that same determination. “This dam is a weapon against the lowlands,” said Ulrich Eichelmann, a German ecologist and conservationist and head of the Austrian NGO RiverWatch, over the phone from Vienna. “It was planned and is now being built in a way they can hold back the whole Tigris for a long time. If you see water as a weapon, dams are the new cannons. Iraq has the oil, Turkey has the water, and sometimes, it’s much better to have the water.” The Tigris and Euphrates rivers, two of the three longest rivers in the Middle East after the Nile, both originate in Turkey. The Euphrates flows across Turkey, south through the heart of Syria, and into Iraq. Now, both of these storied, sacred, ancient rivers are drying up, and the (once) Fertile Crescent is giving way to arid, cracked ground. To some extent, the culprit is climate change. More immediately, the fate and exploitation of these rivers lies with Turkey’s hydropower development and the 41-component project of which the Ilisu Dam is just one part: Dams on the Euphrates have reduced water flow into Syria by an estimated 40 percent in the past 40 years and into Iraq by nearly twice that. With the damming of the Tigris, the last lifeline to this region will also be in Turkey’s grip. Downriver, the effects will be water shortage. The Mesopotamian Marshes in Iraq may turn to desert. This region, now a UNESCO World Heritage site, was drained during the Iran-Iraq War of 1980 and again by Saddam Hussein in a tactical maneuver to expose his enemies. After Hussein’s ouster, the dikes he had built were torn down in celebration, and the parts of the marshland ecosystem began to return to its previous, verdant state. With the Ilisu’s restricted water flow will come not only ecological repercussions but also a tactical advantage for enemies of the region’s inhabitants. Upriver, the problem will be not too little water but an inundation. As with the creation of any major reservoir, bird and fish habitats will be wiped out and the regional climate will be altered. Ecosystems, residential areas, and archaeological sites will be submerged.

US Infantry Fighting Vehicles Appear In Northern Syria - The Pentagon wasn't bluffing, apparently, on its prior statements that mechanized units would be heading into Syria as part of Trump's "secure the oil" plan.  Over the weekend multiple Bradley infantry fighting vehicles (IFV) were filmed leading convoys in around the northern cities of Tal Tamir and Kobani, escorting other armored vehicles along with infantry crew members. Syrian Kurdish and local media are mistakenly describing the armored Bradley M2 infantry fighting vehicles rumbling across the highways as "tanks".   US Abrams or Bradley tanks crossed the city of #Tal_Tamir pass to #Kobani by M4 road   This as there continues to be reports of 'mission confusion' on the ground, given the scope of just what is to be secured on the ground is still in question and though at first it was chiefly said to be ISIS the troops would be protecting the oil fields from, the latest Pentagon statements have named pro-Assad forces as well.One Pentagon official was pressed during a briefing last Thursday over how a country's sovereign resources could be legally stripped away on its own soil, to which a US commander responded: "U.S. troops have the... authorization to shoot if a representative of the Syrian government comes to the.. oil fields and says, 'I am here to take property of these oil fields.'"  Syrian Kurdish and local media are describing the armored Bradley infantry fighting vehicles as "tanks" which are patrolling the highways:  US Abrams tanks crossed the city of #Tal_Tamir pass to #Kobani by M4 road  Navy Rear Admiral William D. Byrne Jr. continued by saying "our commanders always retain the right and the obligation of self-defense when faced with a hostile act or demonstrated hostile intent."

US wants to create illegal quasi-state in eastern Syria: Russia The United States is looking to illegally separate territories on the eastern bank of the Euphrates and create a separate, illegal, quasi-state there, Russian Foreign Minister Sergei Lavrov said, speaking at the Paris Peace Forum on Tuesday. “On the eastern bank of the Euphrates River, they are doing everything possible to create the structure for a quasi-state, and are asking the Gulf States for major investments in order to create a local administration on the basis of the Syrian Democratic Forces, the Kurds – the YPG People’s Protection Units and others, with the clear intention of breaking this piece of territory off from Syria, and controlling the oil fields located there,” Lavrov said. Federal Program Will Pay Off Your Home If You Live In Or Close To Solon InstantHub Ads by Revcontent Find Out More > 95,690 At the same time, Lavrov accused the US of prohibiting its allies from investing in Syria’s reconstruction. “When it comes to Syria’s reconstruction, we, together with the Syrian government, support inviting everyone [to participate], in creating conditions for the modernisation of infrastructure and the return of refugees, so that the country can return to a normal life. The United States categorically denies the need for this, and prohibit its allies – NATO, the European Union, countries of the region, from investing in any projects in the territories controlled by the Syrian government,” the foreign minister said. Last Year, Syrian authorities estimated that between $200 and $400 billion in investment, and up to a decade would be needed to rebuild Syria following the conflict. The US and its European allies have refused to commit to funding reconstruction efforts, although many European countries are facing major social tensions, due to the influx of Syrian refugees into Europe.

Pentagon- We'll Shoot Any Syrian Official Who Tries to Access Syrian Oil -  Pentagon officials asserted Thursday U.S. military authority over Syrian oil fields because U.S. forces are acting under the goal of "protecting Americans from terrorist activity" and would be within their rights to shoot a representative of the Syrian government who attempted to retake control over that country's national resource. The comments came from Pentagon spokesperson Jonathan Hoffman and Navy Rear Admiral William D. Byrne Jr. during a press briefing in which the two men were asked repeatedly about the legal basis the U.S. is claiming to control Syrian oil fields. The briefing came less than two weeks after Defense Secretary Mark Esper said, "That's our mission, to secure the oil fields" in the Deir ez-Zor area of eastern Syria. President Donald Trump's comments before and after that remark —"We're going to be protecting [the oil], and we'll be deciding what we're going to do with it in the future," and "The oil... can help us, because we should be able to take some"— were seized on by critics who claimed Trump was suggesting violating international law by plundering another country's resources and openly saying the U.S. was pursuing war for oil. Hoffman, in his comments Thursday, gave a different message—that "the revenue from this is not going to the U.S. This is going to the SDF," referring to the Kurdish-led and U.S.-allied Syrian Democratic Forces, who are battling ISIS. Byrne claimed that the U.S. has been waging the oil field control mission alongside SDF and that the goal was to prevent ISIS from obtaining the oil revenue. But, as one reporter pointed out, ISIS fighters "have no armor. They have no aircraft." "Do they have the capability to actually seize the oil fields?" the reporter asked. "And isn't this really about Russia and Syria seizing those oil fields?"*Hoffman replied that the goal was "to prevent a resurgence" of ISIS which would be facilitated if the terrorist group had access to the oil revenue. When the Pentagon officials were pressed on whether "U.S. troops have the... authorization to shoot if a representative of the Syrian government comes to the.. oil fields and says, 'I am here to take property of these oil fields,'" Byrne said, "our commanders always retain the right and the obligation of self-defense when faced with a hostile act or demonstrated hostile intent."The officials were reminded by a reporter that "the government of Syria is still, based on international law... [the] recognized legitimate government." Hoffman said, "Everyone in the region knows where American forces are. We're very clear with anyone in the region in working to deconflict where our forces are. If anyone — we work to ensure that... no one approaches or has — shows hostile intent to our forces, and if they do, our commanders maintain the right of self-defense."

Narrative Managers In Overdrive After Death Of White Helmets Founder - Caitlin Johnstone -- James Le Mesurier, the founder of the White Helmets, has died. He was found to have plummeted from a height to the street outside his home, and authorities are reportedly calling it a suicide.Le Mesurier has a history with British military intelligence and was fundamentally involved with an extremely shady narrative management operation geared toward manufacturing support for yet another imperialist military intervention in yet another Middle Eastern nation, so obviously any claims of suicide should be taken with a grain of salt no smaller than a Buick. But it is worth noting that according to Middle East Eye, Le Mesurier’s wife told police that he’d been struggling with psychological issues for which he was taking medications and had previously been hospitalized. Le Mesurier’s home was reportedly only accessible by fingerprint and no video footage of anyone besides Le Mesurier and his wife entering or leaving has been found. Establishment narrative managers, for their part, have been floating the possibility that the White Helmets founder was murdered by the Russian government. The Washington Examiner has published an article titled “Did Russia kill White Helmets founder James Le Mesurier?”, calling to mind Betteridge’s law of headlines which states that “Any headline that ends in a question mark can be answered by the word no.” The BBC’s Mark Urban tweeted out and then deleted a thread (screenshots here) in which he cites an anonymous source who claims to have known Le Mesurier’s flat well enough to be sure that it’s not possible to “fall” from his balcony, then meaningfully pointing to a “black propaganda campaign by Russia and Assad media” against Le Mesurier. He apparently didn’t consider the possibility of suicide until later, saying he deleted his thread due to “new information”. For more info on Le Mesurier and his White Helmet mates, I highly recommend watching this excellent half-hour video by James Corbett. It’s full of primary-source video footage indisputably confirming the organization’s ties to western governments and to violent extremist factions in Syria, and explaining how an allegedly “neutral” organization on the ground has been used to control the narrative about what’s been happening in Syria.

Israel Calls up Reserve Soldiers as Gaza Death Toll Mounts— The Israeli government has called up several hundred reserve soldiers, as the Israeli army continues to strike the Gaza Strip following the assassination of a senior Islamic Jihad military leader in the besieged Palestinian territory. At least 10 Palestinians have been killed and 45 others wounded in Israeli strikes on the Gaza Strip that began early on Tuesday morning, the Palestinian Ministry of Health said. The ministry said that most of those killed were civilians. In the evening local time, Palestinian medical sources said three men were brought dead to the Indonesian Hospital in northern Gaza after they were hit by a missile fired by an Israeli warplane, Palestinian news agency Wafa reported. The Israeli army later tweeted that three Islamic Jihad fighters “who fired rockets from Gaza” were killed. It was unclear whether these were the same three men taken to the Indonesian Hospital. Israel’s initial air strike killed Islamic leader Bahaa Abu al-Atta and his wife, Asmaa, on Tuesday morning. Rockets were fired from the Gaza Strip towards Israel following the targeted assassination. The Israeli army said nearly 200 rockets were launched from Gaza throughout the day. Ninety percent of them were intercepted by Israel’s missile defense system, known as the Iron Dome, the army said. The Israeli military has reinforced its forces along the Gaza frontier, Israeli media reported. Israeli news outlet Ynet said that the reservist soldiers included members of the Iron Dome missile defence units, military intelligence and the Home Front Command. Members of the Home Front Command are typically called up “in times of crisis or war”, according to the group’s website. Israel’s army also closed schools and businesses in the Tel Aviv metropolitan area for the first time since the Gulf War in 1990, the Times of Israel reported.

600 Israeli Violations Against Palestinian Journalists in 2019: Report  — Israeli occupation forces committed 600 violations against Palestinian journalists between October 2018 and October 2019, the Palestinian Journalists’ Syndicate (PJS) announced on Friday. According to the report, which covered the occupied West Bank, East Jerusalem and the Gaza Strip, the most dangerous violations were the direct shootings of journalists.  The report stated that 60 journalists were shot and suffered serious wounds; some of them still suffering at the time of the report.  It also disclosed that 43 journalists had sustained light wounds as they were hit by sound grenades directly thrown at them by the Israeli occupation forces.  “More than 170 journalists were beaten, detained or banned from coverage,” the PJS’ Freedom Committee revealed.It also exposed that more than 180 violations were committed by Facebook in coordination with the Israeli occupation authorities.During the period covered by the report, Israel detained 10 journalists, raising the number of journalists inside Israeli jails to 18.The violations, according to the PJS, included raids of homes, offices, fines and bans of movement inside the country and traveling abroad.

Israel says it will investigate Gaza strike that killed eight members of Palestinian family - The Israeli army said it plans to investigate a 13 November air strike on the Gaza Strip that killed eight members of the same Palestinian family, including five children.The air strike on the home of the al-Sawarka family in Deir al-Balah refugee camp was the single deadliest incident in two days of bombardment by the Israeli army, after its assassination of a senior Islamic Jihad commander and his wife.The Israeli attack killed Rasmi al-Sawarka, also known as Rasmi Abu Malhous, his two wives, and five children, the Palestinian health ministry said. In a statement on Friday, Israeli military spokesman Jonathan Conricus told the AFP news agency that the army's intelligence had indicated "no civilians were expected to be harmed" at the time of the strike.The army said it is "investigating the harm caused to civilians by the strike". Before the statement was released, the Israeli army's Arabic media spokesman, Avichay Adraee, justified the air strike on Twitter, claiming that Sawarka was an Islamic Jihad commander.  On Friday, the United Nations special coordinator for the Middle East peace process said "there is no justification to attacking civilians in Gaza".

How Israeli spy tech reaches deep into our lives - Digital age weapons developed by Israel to oppress Palestinians are rapidly being repurposed for much wider applications – against Western populations who have long taken their freedoms for granted. Israel’s status as a “startup nation” was established decades ago. But its reputation for hi-tech innovation always depended on a dark side, one that is becoming ever harder to ignore. A few years ago, Israeli analyst Jeff Halper warned that Israel had achieved a pivotal role globally in merging new digital technologies with the homeland security industry. The danger was that gradually we would all become Palestinians. Israel, he noted, treated the millions of Palestinians under its unaccountable, military rule effectively as guinea pigs in open-air laboratories. They were the test bed for developing not only new conventional weapons systems, but also new tools for mass surveillance and control. As a recent report in Haaretz observed, Israel’s surveillance operation against Palestinians is “among the largest of its kind in the world. It includes monitoring the media, social media and the population as a whole".

Israeli settlement products must be labeled as such, EU′s top court rules -- Foodstuffs originating from Israeli settlements must be marked as such, the European Court of Justice (ECJ) ruled on Tuesday.The European Union's top court ruled that member states must oblige retailers to identify products made in Israeli settlements with special labels.The issue has been politically divisive — Israel considers the labeling of settler products to be discriminatory and takes a highly critical view of it.Read more: German-Israeli relations: What you need to knowFrance's top tribunal sought clarification from the ECJ after the country published guidelines in 2016 that products from Israeli settlements in the West Bank and Golan Heights must carry labels making their precise origin clear. The guidelines were challenged by the Organisation Juive Europeene (European Jewish Organization) and Psagot, a company that runs vineyards in occupied territories.The groups were concerned that such labeling would facilitate boycotts, such as those endorsed bythe Boycott, Divestment and Sanctions (BDS) movement, which Israel sees as anti-Semitic.Palestinian Liberation Organization Secretary-General Saeb Erekat called the ruling a "legal and political obligation."

High Anxiety: The Trade War and China’s Oil and Gas Supply Security - Columbia | SIPA Center on Global Energy Policy-  In summer 2018, China’s president Xi Jinping, facing pressure from the US-China trade war, intervened in a long-running debate within China’s oil industry about the extent to which national security concerns or market forces should determine domestic oil and natural gas production. Xi effectively tipped the scales in favor of advocates of prioritizing self-sufficiency over cost as part of a broader push for self-reliance amidst trade tensions. As a result, China’s national oil companies (NOCs) are accelerating investment in domestic exploration and production. While this ramp-up in spending is likely to result in an increase in output, especially of natural gas, it is unlikely to alter China’s substantial and growing reliance on oil and natural gas imports. However, the trade war probably will continue to contribute to shifts in the composition of China’s import portfolio, with both traditional and new suppliers gaining shares as a result of the slowdown in the flows of US liquified natural gas (LNG) and crude oil to China and decreases in deliveries of Iranian and Venezuelan crudes due to US sanctions. Xi instructed China’s NOCs to ramp up domestic exploration and production of oil and natural gas to enhance national energy security in July 2018. Xi’s directive is consistent with his championing of self-reliance in response to the US-China trade war. The trigger for Xi’s embrace of self-reliance was the US Department of Commerce’s imposition in April 2018 of an export ban to China’s telecommunications equipment manufacturer ZTE that threatened the Chinese national champion’s survival. Although the Department of Commerce lifted the ban in July 2018, the incident underscored for Beijing the risks of relying on imports, especially from the United States, for critical inputs into the Chinese economy. These inputs include not only semiconductors and the Android operating system but also oil and natural gas as well as exploration and production equipment and technology. Even though there is a chance of a trade truce as of this writing, such a truce probably would not significantly affect the Chinese leadership’s impulse toward greater self-reliance, in part because Chinese officials appear to have concluded that the US is an unreliable partner. Xi’s directive spurred China’s NOCs to release their first ever seven-year plans for accelerating the development of domestic oil and natural gas resources and to increase their exploration and production budgets in 2019 to the highest levels in five years. The companies’ actions mark a shift away from a relatively laissez-faire period in the mid-2010s, when low oil prices prompted them to reduce domestic output and upstream spending and import more oil. These decisions were not without controversy. They rekindled a debate with China’s oil industry about the extent to which China, the world’s largest importer of oil and natural gas, should double down on trying to find and produce more oil at home or take advantage of lower prices to purchase more oil from abroad. Xi’s call for China’s oil companies to grow domestic output effectively gave the edge to proponents of enhancing supply security through increased domestic production.

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