Sunday, April 11, 2021

gasoline imports at a 98 week high despite highest refinery utilization in 54 weeks

oil prices fell for the fourth week in five this week, on rising oil supplies and on the prospect of pandemic related falling demand...after rising 0.8% to $61.45 a barrel last week on expectations that the Biden infrastructure plan would increase demand for oil, the contract price of US light sweet crude for May delivery opened 5 cents higher on Monday but tumbled nearly 5% from there on the likelihood of a increase in oil supplies, from both OPEC's planned production hikes and as a result of the possible easing of US sanctions on Iran, as oil prices closed down $2.80 at $58.65 a barrel...oil prices rose early on Tuesday as a drop in the U.S. dollar made crude a more attractive buy, and hung on to close 68 cents, or 1.2%, higher at $59.33 a barrel on strong economic reports from the US and China and on a stronger global growth forecast from the IMF...oil prices fell in after hours trading Tuesday after the API surprised traders with big product inventory increases and then opened lower on Wednesday, but reversed to climb marginally as traders looked past the EIA's rising gasoline and distillate supplies and turned their attention to the second successive weekly crude stockpile withdrawal, and settled 44 cents higher at $59.77 a barrel on an improving global economic outlook, even as gains were capped by rising gasoline inventories and fears that new coronavirus outbreaks would weaken a global recovery in fuel demand...the brief rally faded on Thursday, however, with oil prices pressured as rising cases of COVID-19 threatened to slow global economies, but recovered to end down just 17 cents at $59.60 a barrel as a falling dollar and rising stock markets offset earlier declines caused by the big increase in gasoline stockpiles and subdued demand compared to pre-pandemic levels...oil prices edged up in early Asian trading on Friday, supported by a weaker dollar, as traders weighed rising supplies and the impact on fuel demand from the COVID-19 pandemic, but turned lower in rangebound US trading on Friday, on rising supplies from major producers and on concerns over a mixed picture on the pandemic’s impact on fuel demand, and finished the session 28 cents lower at $59.32 a barrel, thus ending the week down 3.5%, the biggest weekly loss since mid-March....

natural gas prices also finished lower this week as the heating season appeared to be ending on warming April weather....after rising 0.8% to $2.639 per mmBTU last week on record LNG exports and on a bullish weekly storage report, the contract price of natural gas for May delivery opened 4.6 cents lower on Monday and tumbled 4.9% to a 12.8 cent loss at $2.511 per mmBTU, as weather forecasts shifted much warmer for the next couple of weeks, reducing both heating and power demand through mid-April...natural gas prices rebounded early Tuesday on a cooler revision to the latest weather forecast but failed to hold the gains, closing down another 5.5 cents at 2.456 per mmBTU...natural gas rebounded again on Wednesday, as weather models aligned to forecast a colder trend for mid-April, and this time held onto a 6.4 cent gain at $2.520 per mmBTU...however, gas prices waffled around that price on Thursday as the weekly storage data failed to offer any surprises and weather models maintained a warm pattern for the near term and the May contract price ultimately settled two-tenths of a cent higher at $2.522 per mmBTU...a similar rangebound natural gas trade unfolded on Friday and prices barely moved before adding on another four-tenths of a cent, and thus finished the week at $2.526 per mmBTU, still 4.3% lower than the prior week's close...

the natural gas storage report from the EIA for the week ending April 2nd indicated that the amount of natural gas held in underground storage in the US rose by 20 billion cubic feet to 1,784 billion cubic feet by the end of the week, which left our gas supplies 235 billion cubic feet, or 11.6% below the 2,019 billion cubic feet that were in storage on April 2nd of last year, and 36 billion cubic feet, or 1.3% below the five-year average of 1,808 billion cubic feet of natural gas that have been in storage as of the 2nd of April in recent years....the 20 billion cubic feet that were added to US natural gas storage this week was less than the average forecast of a 27 billion cubic foot addition from an S&P Global Platts survey of analysts, and was also less than the 30 billion cubic feet added to natural gas storage during the corresponding week of a year earlier, but was well more than the average addition of 8 billion cubic feet of natural gas that have typically been injected into natural gas storage during the same week over the past 5 years... 

The Latest US Oil Supply and Disposition Data from the EIA

US oil data from the US Energy Information Administration for the week ending April 2nd indicated that because of a decrease in our oil production and modest increases in our oil exports and our oil refining, we needed to withdraw oil from our stored commercial crude supplies for the second time in seven weeks and for the 24th time in the past thirty-seven weeks....our imports of crude oil rose by an average of 119,000 barrels per day to an average of 6,264,000 barrels per day, after rising by an average of 523,000 barrels per day during the prior week, while our exports of crude oil rose by an average of 260,000 barrels per day to an average of 3,434,000 barrels per day during the week, which meant that our effective trade in oil worked out to a net import average of 2,830,000 barrels of per day during the week ending April 2nd, 141,000 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 reportedly 200,000 barrels per day lower at 10,900,000 barrels per day, and hence our daily supply of oil from the net of our trade in oil and from well production appears to total an average of 13,730,000 barrels per day during this reporting week... 

meanwhile, US oil refineries reported they were processing 15,044,000 barrels of crude per day during the week ending April 2nd, 103,000 more barrels per day than the amount of oil they used during the prior week, while over the same period the EIA's surveys indicated that a net of 503,000 barrels of oil per day were being pulled out of the supplies of oil stored in the US....so based on that reported & estimated data, this week's crude oil figures from the EIA appear to indicate that our total working supply of oil from net imports, from storage, and from oilfield production was 811,000 barrels per day less than what our oil refineries reported they used during the week....to account for that disparity between the apparent supply of oil and the apparent disposition of it, the EIA just plugged a (+811,000) barrel per day figure onto line 13 of the weekly U.S. Petroleum Balance Sheet to make the reported data for the daily supply of oil and the consumption of it balance out, essentially a fudge factor that they label in their footnotes as "unaccounted for crude oil", thus suggesting there must have been a error or errors of that magnitude in this week's oil supply & demand figures that we have just transcribed....however, since most everyone treats these weekly EIA reports as gospel and since these figures often drive oil pricing and hence decisions to drill or complete wells, we'll continue to report them as they're published, just as they're watched & believed to be accurate by most everyone in the industry....(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) indicate that the 4 week average of our oil imports rose to an average of 5,838,000 barrels per day last week, which was 5.0% less than the 6,144,000 barrel per day average that we were importing over the same four-week period last year... the 503,000 barrel per day net withdrawal from our crude inventories was due to a 503,000 barrel per day withdrawal from our commercially available stocks of crude oil, while the oil supplies in our Strategic Petroleum Reserve remained unchanged....this week's crude oil production was reported to be 200,000 barrels per day lower at 10,900,000 barrels per day because the rounded estimate of the output from wells in the lower 48 states was 300,000 barrels per day lower at 10,400,000 barrels per day, while a 13,000 barrel per day increase to 458,000 barrels per day in Alaska's oil production added 100,000 barrels per day the rounded national total (EIA's math)....our record high US crude oil production during the week ending March 13th 2020 was at a rounded 13,100,000 barrels per day, so this reporting week's rounded oil production figure was 16.8% below that of our production peak, yet still 29.3% above the interim low of 8,428,000 barrels per day that US oil production fell to during the last week of June of 2016...    

meanwhile, US oil refineries were operating at 84.0% of their capacity while using those 15,044,000 barrels of crude per day during the week ending April 2nd, up from 83.9% of capacity during the prior week, and the highest refinery utilization in 54 weeks, reflecting the utilization level during the last week before the Covid slowdown...while the 15,044,000 barrels per day of oil that were refined this week were 10.3% higher than the 13,634,000 barrels of crude that were being processed daily during the week ending April 3rd of last year, they were still 6.6% below the 16,100,000 barrels of crude that were being processed daily during the week ending April 5th, 2019, when US refineries were operating at a still low 87.5% of capacity...

even with the increase in the amount of oil being refined, the gasoline output from our refineries decreased by 60,000 barrels per day to 9,279,000 barrels per day during the week ending April 2nd, after our gasoline output had increased by 762,000 barrels per day over the prior week...while this week's gasoline production was 59.5% higher than the 5,818,000 barrels of gasoline that were being produced daily over the same week of last year, it was still 6.9% lower than the March 13th 2020 pre-pandemic high of 9,972,000 barrels per day....meanwhile, our refineries' production of distillate fuels (diesel fuel and heat oil) decreased by 99,000 barrels per day to 4,639,000 barrels per day, after our distillates output had increased by 137,000 barrels per day over the prior week... but since the onset of the pandemic didn't appear to impact distillates' production, this week's distillates output was still 6.9% lower than the 4,982,000 barrels of distillates that were being produced daily during the week ending April 3rd, 2020...

even with the decrease in our gasoline production, our supply of gasoline in storage at the end of the week increased for the fifteenth time in twenty-one weeks, and for 19th time in 38 weeks, rising by 4,044,000 barrels to 234,588,000 barrels during the week ending April 2nd, after our gasoline inventories had decreased by 1,735,000 barrels over the prior week...our gasoline supplies increased this week because our imports of gasoline rose by 678,000 barrels per day to a 98 week high of 1,297,000 barrels per day while our exports of gasoline rose by 251,000 barrels per day to 792,000 barrels per day, and because the amount of gasoline supplied to US users decreased by 101,000 barrels per day to 8,891,000 barrels per day...but even after this week's inventory increase, our gasoline supplies were 8.8% lower than last April 3rd's gasoline inventories of 257,303,000 barrels, and about 2% below the five year average of our gasoline supplies for this time of the year... 

meanwhile, even with the decrease in our distillates production, our supplies of distillate fuels increased for the 4th time in 10 weeks and for the 12th time in thirty-two weeks, rising by 1,452,000 barrels to 145,547,000 barrels during the week ending April 2nd, after our distillates supplies had increased by 2,542,000 barrels during the prior week....our distillates supplies rose by less this week even though the amount of distillates supplied to US markets, an indicator of our domestic demand, fell by 449,000 barrels per day to 3,664,000 barrels per day, because our exports of distillates rose by 398,000 barrels per day to 1,092,000 barrels per day, and because our imports of distillates fell by 116,000 barrels per day to 325,000 barrels per day...after this week's inventory increase, our distillate supplies at the end of the week were 18.6% above the 122,724,000 barrels of distillates that we had in storage on April 3rd, 2020, and rose to about 5% above the five year average of distillates stocks for this time of the year...

finally, with the increase in our oil exports and the recovery in our refinery throughput, our commercial supplies of crude oil in storage fell for the 13th time in the past twenty-one weeks and for the 25th time in the past year, decreasing by 3,522,000 barrels, from 501,835,000 barrels on March 26th to 498,313,000 barrels on April 2nd...after this week's decrease, our commercial crude oil inventories fell to 3% above the most recent five-year average of crude oil supplies for this time of year, and to 44.6% above the average of our crude oil stocks as of the first weekend of April over the 5 years at the beginning of this decade, with the disparity between those comparisons arising because it wasn't until early 2015 that our oil inventories first topped 400 million barrels....since our crude oil inventories had jumped to record highs during the spring lockdowns of last year, after generally rising over the past two and a half years, except for summers and during the 10 weeks prior to the Texas freeze, after generally falling from a record high over the year and a half prior to September of 2018, our commercial crude oil supplies as of April 2nd were 2.9% more than the 484,370,000 barrels of oil we had in commercial storage on April 3rd of 2020, and 9.1% more than the 456,550,000 barrels of oil that we had in storage on April 5th of 2019, and also 16.3% more than the 428,638,000 barrels of oil we had in commercial storage on April 6th of 2018...      

This Week's Rig Count

Note: this week's rig count includes 8 days, since last week's report was released on Thursday in advance of the Good Friday...nonetheless, the rig count rose for the 27th time over the past 30 weeks during the week ending April 9th, but it still remains down by 45.5% from the pre-pandemic rig count....Baker Hughes reported that the total count of rotary rigs running in the US was up by 2 to 432 rigs this past week, which was still down by 170 rigs from the 602 rigs that were in use as of the April 10th report of 2020, and was 1,497 fewer rigs than the shale era high of 1,929 drilling rigs that were deployed on November 21st of 2014, the week before OPEC began to flood the global oil market in their first attempt to put US shale out of business....

The number of rigs drilling for oil was unchanged at 331 oil rigs this week, after rising by 13 oil rigs the prior week, leaving us with 167 fewer oil rigs than were running a year ago, and 20.6% of the recent high of 1609 rigs that were drilling for oil on October 10th, 2014....at the same time, the number of drilling rigs targeting natural gas bearing formations was up by two to 93 natural gas rigs, which was only down by 3 natural gas rigs from the 96 natural gas rigs that were drilling a year ago, but still just 5.8% of the modern era high of 1,606 rigs targeting natural gas that were deployed on September 7th, 2008...in addition to those rigs drilling for oil or gas, two rigs classified as 'miscellaneous' continued to drill this week, one in the middle of the Permian basin in MIdland county Texas, and the other in Lake County, California, while a year ago there were also two such "miscellaneous" rigs deployed...

The Gulf of Mexico rig count was down by 3 to 11 rigs this week, with 10 of those rigs drilling for oil in Louisiana's offshore waters and 1 continuing to drill for oil in Alaminos Canyon offshore from Texas...that was 7 fewer Gulf of Mexico rigs than the 18 rigs drilling in the Gulf a year ago, when all 18 Gulf rigs were drilling for oil offshore from Louisiana...since there are no rigs operating off of other US shores at this time, nor were there a year ago, this week's national offshore rig totals are equal to the Gulf rig counts....

The count of active horizontal drilling rigs was up by 3 to 394 horizontal rigs this week, which was still down by 151 rigs from the 545 horizontal rigs that were in use in the US on April 10th of last year, and less than a third of the record of 1372 horizontal rigs that were deployed on November 21st of 2014....meanwhile, the directional rig count was down by one rig to 18 directional rigs this week, and those were also down by 17 from the 35 directional rigs that were operating during the same week a year ago....at the same time, the vertical rig count was unchanged at 20 vertical rigs this week, and those were down by 2 from the 22 vertical rigs that were in use on April 10th of 2020....

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 basins...in both tables, the first column shows the active rig count as of April 9th, the second column shows the change in the number of working rigs between last week's count (April 1st) and this week's (April 9th) count, the third column shows last week's April 1st active rig count, the 4th column shows the change between the number of rigs running on Friday and the number running on the Friday 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 10th of April, 2020..    

April 9 2021 rig count summary

as you can see, there were ​just a few changes this week, after widespread new activity last week...checking for the details on the Permian basin in Texas from the Rigs by State file at Baker Hughes, we do find that that one rig was added in Texas Oil District 8, which includes the core Permian Delaware, while one rig was pulled out of Texas Oil District 7C, which includes the southernmost counties of the Permian Midland basin, which thus leaves us with no change in the rig count in the Texas Permian this week.....elsewhere in Texas, there was one rig added in Texas Oil District 1, while a rig was pulled out from Texas Oil District 4, which both could have been in the Eagle Ford shale, which stretches in a narrow band through the southeast part of the state, still leaving no net change in that basin either...at the same time, there was also a rig added in Texas Oil District 6, which must have been targeting that region's Haynesville shale, since the Haynesville shale count was unchanged in northern Louisiana....the Texas count is still unchanged, however, because an offshore platform in the state's waters was shut down at the same time, while the Louisiana is only down one despite the loss of two offshore rigs because there was a land rig startup in an unnamed basin in the southern part of the state...elsewhere, two more oil rigs were added in a Utah basin not tracked by Baker Hughes, more than likely the Uinta, and another oil rig was added in Oklahoma, also in a basin not tracked by Baker Hughes, while an oil rig was shut down in Wyoming, which could have been operating in any one of three basins in that state Baker Hughes doesn't track..for this week's two additions of natural gas rigs, we have the rig that was added in the Haynesville shale, and another rig that was added in Ohio's Utica shale at the same time...

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USA looks forward to making its move— The Utica Shale Academy is making preparations to possibly move out of its current location at Southern Local High School and into a building in Salineville recently donated to Southern by Williams Energy. USA Superintendent Bill Watson said while nothing is definite yet, it is an exciting option. There have been architects inside the Kenneth Hutson Building on East Main Street and it has now been approved for a capacity of 220 students, which will provide enough space for the technical programs and career-based intervention programs offered through the USA, as well as space for growth. Watson said the architects have completed drawings and the building could be ready for them as early as June or July. The elevator is operable and the fire suppression system is up to date. Additionally, Watson said being in Salineville at a location near the park will give students a chance to earn credit, possibly a community seal, for giving back to the community. Lori Woods, who attends the meetings as a sponsor of the USA through the Ohio Department of Education, said Tuesday she got a chance to see the new building and she was looking forward to everything that was happening there. In the future she will be helping them look at options for local seals that students can use to help them qualify for graduation.  As of Tuesday, 33 seniors are on track to graduate from the USA with enough credits as long as they continue to follow through to the end of the school year. Watson asked the board to approve up to $11,545 total in wellness stipends to be split between two staff members who will contact the students and lend them support through graduation. Watson said they did this last year and 20 out of 20 senior students graduated, despite everything being changed in their lives due to Covid-19.

U.S. Secretary Of Energy Jennifer Granholm Says There Is A Future For Some Fossil Fuels In Western Pa. – CBS Pittsburgh — (video & transcript) This region has often been called the Saudi Arabia of natural gas. What’s the future of natural gas and other fossil fuels under the Biden administration? In an interview seen only on KDKA, political editor Jon Delano spoke with the new U.S. secretary of energy for some answers.

Marcellus and Utica Shales in the United States of America Report- Gas Shale Market Analysis and Outlook to 2021 -The Appalachia Basin which is made up of the Marcellus formations and the Utica Shale, accounted for more than 40% of the natural gas produced in the United States in 2020. Most of the production comes from the state of Pennsylvania and Ohio and partially from West Virginia. Unlike many of the oil plays in the US Lower 48, the natural gas plays including the Appalachia Basin saw a less drastic change in production and drilling activity during the economic contraction caused by the Covid-19 pandemic. While major oil-producing operators slashed their 2020 capital expenditure up to 50% – 60%, the top three producers in the Appalachia Basin EQT Corporation, Antero Resources, and Southwestern Energy have only cut their capital by 20%, 35% and 40%, respectively. This region averaged 32.19 billion cubic feet of natural gas per day (bcfd) and 33.44 bcfd in 2019 and 2020, respectively. The report analyzes the crude oil and natural gas appraisal and production activities in Marcellus and Utica Shales play in the US. The scope of the report includes –
– Comprehensive analysis of natural gas and crude oil historical production and short term outlook of Marcellus and Utica shale plays during 2019-2021
– Detailed information of impact on well development, permits and deals due to COVID-19 pandemic
– In-depth information on net acreage, operational performance and financial standings of major operators in Marcellus and Utica shale plays
– Analysis of top companies’ future plans and cost trends in 2020
– Up-to-date information on associated infrastructure and major mergers and acquisitions in Marcellus and Utica shale plays between 2018 and 2020

Valley Creek fouled at Mariner pipeline construction site (photos) —According to the Pennsylvania Department of Environmental Protection, Mariner East 2 pipeline drilling near the Chester County Library is dumping about 700 gallons per minute, or a million gallons per day, of rusty brown water laden with silt and clay into Valley Creek. A brown plume is visible entering the renowned trout stream from the south end of the library parking lot. Up to 10 inches of soil-laden water covers much of the dense wetlands between the creek and drilling site near the 185-home Meadowbrook Manor subdivision. Township residents Libby Madarasz and Ginny Kerslake have strapped on high boots and visited the wetlands behind Sunoco’s work site many times since the surge of water was detected. A resident noticed the plume Sunday afternoon and the DEP responded to the scene within an hour of being notified. A DEP representative was told by a pipeline builder Sunoco/Energy Transfer representative that the discharge was “normal.” Madarasz visited the drilling site again on Wednesday. She said that she is concerned that aquatic plant life will be coated with clay and silt when the waters recede further. Sunoco/ET had originally intended to dig using horizontal directional drilling. The pipeline right-of-way runs within a few feet of the library. Plans were changed midstream and trench digging was performed, with boring beneath the creek. Sunoco/ET needs to keep their bore pit dry in order to perform construction through this wetland and under the creek. This requires pumping groundwater from drilled wells on the site and discharging it into the environment or hauling it away in 5,000 gallon trucks. Kerslake was critical of the DEP response. “Energy Transfer is failing to comply with the DEP’s permit requirement to prevent sediment from being discharged into waters of the Commonwealth,” Kerslake said. “And instead of enforcing their permit and protecting the environment, the DEP is once again turning a blind eye on this egregious project.”

19 states press Supreme Court on pipeline eminent domain -- Thursday, April 8, 2021 --  States, property rights advocates and local government organizations yesterday urged the Supreme Court to affirm New Jersey's constitutional right to block construction of a natural gas pipeline.

NYC leaders urge feds to kill Williams Pipeline once and for all — Over two dozen New York City leaders have urged the federal government to kill a controversial pipeline project that would run underneath the waters off the Rockaway Peninsula. The proposed Williams Northeast Supply Enhance Pipeline, or Williams Pipeline, would deliver fracked gas from Pennsylvania to New York city via a tube underneath New York Harbor. The plan was rejected last year by New York’s Department of Environmental Conservation. In a letter Wednesday, Comptroller Scott Stringer, Queens Borough President Donovan Richards and State Sens. Joseph P. Addabbo, Jr., Jessica Ramos and James Sanders called on Federal Energy Regulatory Commission Richard Glick to also reject the Williams Pipeline once and for all. The pipeline would move the city and state further from achieving its climate goals, they said.“We take climate change seriously, as we have already lost loved ones here in New York City to climate-fueled superstorms and heat waves that caused death, illness, debt, and scarcity,” the leaders wrote. “For our constituents and for the future generations who will live with the consequences of allowing the Williams Pipeline to be built, we urge you to deny Williams’ request.”The letter cites Glick’s own condemnation of the initial FERC approval of the project in 2019, when he said that declaring the pipeline safe “fails to give climate change the serious consideration it deserves and that the law demands.”On March 19, Transcontinental Gas Pipe Line Company requested a two year extension to kickstart the project. The 17.4-mile-long, 26-inch diameter connection would transport fracked gas under the Atlantic Ocean off the shores of Rockaway Beach.The letter cites the emissions impact of the gas being brought into the city once burned, new FERC recommendations that take into account the effects of transporting the gas  — like methane leaks — and climate justice for the city’s most vulnerable communities.“We will not allow the racist legacy of environmental and climate injustice to continue by building infrastructure that will increase the amount of polluting fracked gas in our city,” the letter continues The lawmakers, including local assembly members and distinct leaders, also acknowledged significant public opposition to the pipeline, underscored by the more than 16,000 critical comments submitted during the DEC review period.

Sen. Markey reintroduces legislation to block compressors for natural gas exports— In an effort to prevent projects like the compressor station on the banks of the Fore River, U.S. Sen. Ed Markey said he has refiled legislation that would block construction of any compressor station that would aid energy companies in exporting natural gas overseas. "None of this natural gas is needed for Massachusetts. It's just being shipped through like a straw for the benefit of the natural gas companies," Markey, D-MA, said Friday. "I'll be working to prevent the construction and operation of facilities like the Weymouth compressor, which ask communities to bear all of the risks." Markey visited the compressor station site Friday morning along with state and local officials, including Democratic State Reps. James Murphy of Weymouth and Joan Meschino of Hull; and State Sens. Patrick O'Connor, R-Weymouth, John Keenan, D-Quincy, and Walter Timilty, D-Milton. Members of the Fore River Residents Against the Compressor Station also turned out to show their opposition to the compressor, which is now fully constructed. "It is time we end this dangerous project once and for all," Markey told the crowd. "Let us keep up this fight. We're going to take it to the Federal Energy Regulatory Commission and we're not going to stop until we win." The compressor station is part of Enbridge’s Atlantic Bridge project, which expands the company’s natural gas pipelines from New Jersey into Canada. Since the station was proposed in 2015, residents have argued it presents serious health and safety risks. The Federal Energy Regulatory Commission recently voted to take a look at several issues associated with the compressor station, including whether the station’s expected air emissions and public safety impacts should prompt commissioners to reexamine the project. Alice Arena, leader of the Fore River Residents Against the Compressor Station, said the citizens group recently celebrated the sixth anniversary of its opposition to the project. She said all members of the local delegation have worked alongside residents to fight against the compressor station. "Although we see here that it's constructed, it's not operating," Arena said. "Enbridge will tell you it's operation, but Enbridge has a little problem with truthiness. We have been watching this vigilantly and we know that they have not been performing like they should.

Massachusetts politicians push to shutter Weymouth gas compressor station after third unplanned release of gas - Ahead of a deadline Monday evening, gas companies and industry groups rushed to tell federal regulators that a controversial Weymouth gas compressor station should be allowed to continue operating despite its rocky history, arguing the site was safe and critical to the country’s energy infrastructure.Then, around 9:37 a.m. Tuesday morning, the site spewed at least 10,000 standard cubic feet of natural gas into the surrounding neighborhood, its third unplanned release in just eight months. That incident comes at a crucial moment for the compressor station as federal regulators take a rare second look at its safety protocols and community impact. And it triggered a new wave of condemnations from top Massachusetts politicians, who say the only appropriate course of action is to shutter the site immediately.

Huge Drop for Natural Gas Futures on ‘Very Weak’ Power Burns -- Natural gas futures took a dramatic fall after the Easter holiday weekend as weather forecasts shifted much warmer for the next couple of weeks. With April on pace to be warmer than normal, the May Nymex gas futures contract plunged 12.8 cents Monday to settle at $2.511/MMBtu. June fell 11.5 cents to $2.582. markets Spot gas prices also posted sharp losses across the country amid very light demand. NGI’s Spot Gas National Avg. dropped 16.0 cents to $2.185. Monday’s steep price drops along the Nymex futures curve were a sharp deviation from last week’s price action. Prices during the short trading week leading up to Easter shifted less than a nickel each day. Over the three-day weekend, though, the European and American weather models both posted large degree day losses in Weeks 1 and 2 that led to projected demand contracting by 18 Bcf, according to EBW Analytics Group. The May Nymex futures contract flirted with the $2.50 level, and even sank below it, throughout much of Monday’s session. The prompt month ultimately settled near the low end of the roughly 13.0-cent range. There is support for a cooler trough to move into the eastern United States toward the middle of the month, according to Bespoke Weather Services. However, this is only expected to bring demand back up toward near-normal levels at this time, keeping April on pace to be yet another warmer-than-normal month “rather easily.

Mid-April Cold Snap Drives Gains for Natural Gas Futures; Western Cash Prices Rally - Natural gas futures managed to hold onto early gains midweek despite little change in fundamentals. The May Nymex gas futures contract traded in a nearly 10-cent band before settling Wednesday at $2.520, up 6.4 cents day/day. June picked up 6.1 cents to reach $2.597. Spot gas prices were mixed on Wednesday as the low price environment likely started to incentivize power burns. NGI’s Spot Gas National Avg. climbed 4.0 cents to $2.280. After some stubborn technical resistance came into play on Tuesday, the prompt month climbed early on Wednesday after the Global Forecast System model gained 10 heating degree days on further colder trends for April 14-20, putting it in better agreement with the European data, according to NatGasWeather. Both models see more impressive cold shots sweeping across the eastern two-thirds of the country for stronger demand for that period. “Of course, the pattern the next seven days before then is about as bearish as it gets, with national demand exceptionally light for this time of the year due to very limited coverage of subfreezing air,” the forecaster said. How long the projected cooler-than-normal pattern seen for April 14-20 lasts is now of great interest, according to NatGasWeather. The GFS and the European model see cool eastern United States air slowly fading April 21-24, although changes are likely given the long lead time. Bespoke Weather Services said it views the cooling as likely “limited” in terms of duration. The pattern, according to the forecaster, may tilt back to the warmer-than-normal side toward the end of the month. Bespoke said there were only minor changes in production and liquefied natural gas (LNG) volumes early Wednesday, and power burns remained marginally stronger on a weather-adjusted level than they had been previously. However, burns were still weak, overall. The forecaster said it was “neutral” as far as price action in the near term, given some “marginal improvement” in the data over the last couple of days. However, cash prices have been “very weak” and that would need to change to stimulate any sustainable move higher.

US natural gas storage fields post another strong shoulder season build | S&P Global Platts — Above-average injections into US gas storage fields during shoulder season suggest stocks might fill early this year, presenting a possibly bearish market landscape this summer. Storage inventories increased 20 Bcf to 1.784 Tcf for the week ended April 2, the US Energy Information Administration reported April 8. The build was less than the 27 Bcf injection expected by an S&P Global Platts' survey of analysts. It was also less than the 30 Bcf addition reported during the same week last year, but above the five-year average injection of 8 Bcf, according to EIA data. Lower weather-driven demand pushed US residential-commercial consumption down almost 2 Bcf/d for the week ended April 2, according to S&P Global Platts Analytics. Despite reduced space heating, power loads increased week over week as modest cooling degree days drove some demand in the Southeast. Higher total loads interacted with stronger renewable generation, though, pushing the call on thermal generation lower. Yet, despite the smaller call on thermal generation, US gas-fired generation gained nearly 800 MMcf/d, with gas' share of thermal generation growing by about 2% to average roughly 63.5%. Switching to supply, US production gained a modest 200 MMcf/d, while a softer call on Canadian inflows drove net imports lower by roughly 100 MMcf/d. Storage volumes now stand 235 Bcf, or 11.6%, less than the year-ago level of 2.019 Tcf and only 24 Bcf, or 1.3%, less than the five-year average of 1.808 Tcf. Natural gas prices saw some selling pressure with the May Henry Hub NYMEX contract falling to as low as $2.46/MMBtu on April 7. The weakness in price appears to be driven by a lack of bullish catalysts, as the market is entering a period in which loads are seasonally quite weak and demand is soft. As such, it appears NYMEX futures are largely being shaped by cash prices with Henry Hub spot prices clearing below $2.40/MMBtu on April 8. The NYMEX Henry Hub May contract was at $2.51/MMBtu in trading following the release of the weekly storage report on April 8. Platts Analytics' supply and demand model currently forecasts a 64 Bcf injection for the week ending April 9, which would flip the deficit to the five-year average to a surplus. The inventory gains were concentrated in the South Central and Midwest regions, which each accounted for a little more than a third of the total volume change week over week. Mild shoulder season weather means temperatures are rising enough to cut residential and commercial demand, but not climbing high enough to provide offsetting gains to power burn.

Universities Could Ban Natural Gas Under Bill, But Not Indiana Cities -- House Bill 1191 would now allow universities to put policies in place to make their buildings greener, but cities still wouldn’t be able to do so. The bill as a whole prevents cities from banning natural gas and less energy efficient materials when constructing a new home or a building. Climate activists and some other groups were glad similar language that applied to colleges and universities was cut out of the bill, but many groups are still opposed.The proposal was authored by home builder and lawmaker Rep. Jim Pressel (R-Rolling Prairie). He said going green drives up the cost of home prices and that home buyers should have a choice in what kind of energy they use.“My customers want gas — they do. They want gas-fired barbecues, they want gas lights, they want that choice," he said.Cities in states like California, Ohio, and Massachusetts have passed ordinances banning natural gas in new buildings because of climate concerns. Joe Yount with the American Institute of Architects in Indiana. He said not allowing cities like Indianapolis to require energy efficiency could make it more difficult to reduce greenhouse gas emissions and reach climate goals.

Memphis groups against Byhalia pipeline file lawsuit to stop permit -- With national attention on the proposed Byhalia pipeline mounting, a trio of Memphis environmental advocacy groups and the Southern Environmental Law Center filed a lawsuit Thursday against the U.S. Army Corps of Engineers, which issued a federal permit in February allowing for the 49-mile crude oil pipeline construction. Because the type of “general" permit issued the Byhalia pipeline does not require the same environmental analysis as those the Corps greenlights on an individual, case-by-case basis, the suit alleges the Corps did not fulfill its requirements under the Clean Water Act and the National Environmental Policy Act to assess potential impacts to the Memphis drinking water supply and the 130 streams and wetlands crossed by the proposed route through southwest Memphis and northern Mississippi. The Corps also falls "woefully short" of meeting public input requirements in its use of the permit for crude oil pipeline projects, according to the consortium of Memphis non-profits represented by the Southern Environmental Law Center, including the Sierra Club, Protect Our Aquifer and the newly incorporated Memphis Community Against Pollution, whose members launched the grassroots group Memphis Community Against the Pipeline in October. Kenneth Williams, of the Corps' Public Affairs Office in Memphis, said in an email that while the agency cannot comment on ongoing litigation, the Memphis District has been transparent about its approval of the permit in responding to dozens of inquiries from citizens, media and public officials thus far. Responding in early February to questions from U.S. Rep. Steve Cohen, the Corps acknowledged public interest concerns related to the risk of contamination in a protected area where Memphis Light, Gas and Water wellheads are connected below ground to the city's drinking water supply — and through which the pipeline is routed. "The nationwide permit program was designed to enable quick determinations of activities with minimal environmental impacts," District Commander and Col. Zachary Miller wrote Cohen, citing the Corps' interpretation of a "public water supply intake" as limited to surface water. The Corps lacks jurisdiction to address potential discharges to groundwater; "indirect emissions" of air pollution resulting from the refining of crude oil transported by pipeline; and spills or leaks from oil and gas pipelines, Miller states in the letter which also invokes the monitoring and mitigation measures the pipeline company has said will be in place.

US LNG feedgas demand surges as export capacity additions continue. --If there’s one word that sums up the U.S. LNG export market over the past year, it’s resilience. After taking a pummeling last year, feedgas demand and exports have roared back, reaching new heights in recent weeks, and are headed still higher in the coming months as new liquefaction capacity is commissioned at a faster pace than expected. Train 3 at Cheniere Energy’s Corpus Christi LNG facility came online on March 26, increasing U.S. LNG export capacity to 75 MMtpa (~9.9 Bcf/d), which equates to a total feedgas demand of nearly 11 Bcf/d. Two more export projects — 18 modular trains at Venture Global’s new Calcasieu Pass facility and the sixth train at Cheniere’s existing Sabine Pass — are on track to ship their first commissioning cargoes later this year, ahead of their originally proposed construction schedules, and will be fully operational in 2022. This is quite a different picture from last year, when nothing but uncertainty loomed on the horizon in a COVID-hit world and progress for just about every project was in jeopardy. Today, we start a short series providing an update on the status of operational and under-construction export capacity and where LNG feedgas demand is headed this year. As we discussed recently in Wild Thing, feedgas demand and U.S. LNG production over the past year faced unprecedented volatility, first because of economically driven cargo cancellations due to COVID-19 and the subsequent crash in prices globally (see Break It to Me Gently, Undone and LNG Interruption for more). Then, later last year, just as global demand and prices were rising again, a record-setting hurricane season wreaked havoc on the operations of Gulf Coast LNG terminals, particularly in Louisiana, hampering exports (see You Spin Me Round). Feedgas consumption recovered by winter, but the Gulf Coast terminals continued to see intermittent disruptions, even as global prices and demand remained strong. Earlier this year, we saw a slowdown in exports, albeit relatively modest, stemming from constraints on passage through the Panama Canal, which in turn led to voyage delays and a vessel shortage. Then came Winter Storm Uri, which created a severe gas shortage in Texas and curtailed production as export facilities sent gas back into the market to help meet domestic demand (see Feed Me). That was followed by a period of foggy conditions along the Gulf Coast that intermittently interrupted marine traffic. However, as the weather turned warmer, most facilities returned to full operating capacity and feedgas demand rebounded. Feedgas consumption averaged about 10.9 Bcf/d in the second half of March (orange line in Figure 1) after peaking above 11 Bcf/d on multiple days and breaking the single-day record three times as Corpus Christi Train 3 reached the final days of its commissioning and entered service on March 26. In the first few days of April, feedgas volumes have continued to top 11 Bcf/d.

Venture Global’s Calcasieu Pass LNG Feed Gas Pipeline Cleared for Service -  FERC has authorized U.S. liquefied natural gas (LNG) developer Venture Global LNG Inc. to place into service a pipeline to deliver feed gas to the company’s Calcasieu Pass export facility, currently under construction in Louisiana.In a letter filed Wednesday, the Federal Energy Regulatory Commission cleared Venture Global’s TransCameron pipeline to enter service based on the company’s recent construction reports and photo documentation.“We find that TransCameron has adequately stabilized the construction workspaces and that restoration is proceeding satisfactorily,” Rich McGuire, director of FERC’s Gas – Environment and Engineering division, wrote in the letter.In its request submitted last month, Venture Global said the pipeline was mechanically complete and would be ready to flow gas by Wednesday.The 24-mile, 42-inch-diameter TransCameron pipeline extends eastward from the Calcasieu Pass LNG facility to Grand Chenier, LA. There, it interconnects with TC Energy Corp.’s ANR Pipeline, Enbridge Inc.’s Texas Eastern Transmission Co. system, aka Tetco, and EnLink Midstream LLC’s Bridgeline system. Venture Global says it has contracted “long-term, firm, uninterruptible transport capacity” on each of the pipelines, connecting the TransCameron Pipeline to more than 2 Bcf/d of natural gas supply.

Father of Teen Killed in Oil Tank Explosion Pushing for New Louisiana Safety Measures - Maxwell Smith is on a mission to make sure no one loses a child the way he lost his 14-year-old daughter, Zalee Gail Day-Smith. Zalee, a vivacious high school freshman who loved singing, died on February 28 when oil tanks exploded near her home in Beauregard, Louisiana. “Her body was thrown 200 feet in the air,” Smith told me when I went to visit the family a month after the accident. Zalee’s body was found across the street from the site of the blast in the Bear Field oil field, just north of Lake Charles. It was located alongside one of the oil tanks that had been blown off its foundation. Smith says that his daughter’s body was mutilated to such a degree that the family was never allowed to see it. Zalee lived with her mother, sister, and twin brother about a hundred feet from the oil field site owned by Urban Oil and Gas LLC, a Texas-based company that holds numerous oil and gas leases in Louisiana and several western states.  “The landlord told us it was ok to play on the site,” Mattisun Miner, one of Zalee’s older sisters told me. Douglas Kent Carroll, Zalee’s older brother, also said that the landlord made it clear that the tanks next door to the home were nothing to worry about. The landlord did not respond to a request for comment. The rural area is littered with oil field sites that range in activity from actively producing wells to permanently decommissioned ones, and everything in between. So, when Carroll’s family members moved into a house next to one of these sites, it didn’t raise his concern at the time. He now knows better. At the Urban Oil and Gas site that exploded is an injection well that was used to dispose of wastewater from oil production and a tank battery — a set of storage and processing tanks — in this case, two of which stored oil — that were linked to two shut-in oil wells nearby, according to Patrick Courreges, communications director for the Louisiana Department of Natural Resources (LDNR). In 2012, one of the wells was shut-in, meaning the operator purposely turned a valve to stop the well from producing, a process which can be reversed to later restart production. The other well was shut-in in February last year, not long before Zalee’s family moved in.  Her family was under the impression that this oil field site had been permanently decommissioned. But Urban Oil and Gas had only paused production and left oil in the storage tanks on the property next to Zalee’s home. The site had no apparent activity while the family lived next to it — they were evicted shortly after the explosion — and there was no sign describing its current status.

US gasoline inventories rise 4.04 million barrels as imports jump: EIA - US gasoline inventories climbed 4.04 million barrels to 234.59 million barrels last week, as imports jumped and refinery runs edged higher, US Energy Information Administration data showed April 7. Gasoline imports climbed 678,000 b/d to 1.3 million b/d, with the bulk of that increase – 635,000 b/d – heading to the US Atlantic Coast, home of the New York delivery point for NYMEX RBOB futures. NYMEX RBOB futures fell following the EIA data, with the front-month crack spread against ICE Brent crude ending at around $18.82/b April 7, down from $19.70/b April 6. Still, that's up from minus $1.85/b the same time last year, when RBOB crack spreads were sent into negative territory by the global coronavirus lockdowns. US gasoline crack spreads and refining margins have risen this year as the US has started to open up, driven by a steady increase in coronavirus vaccinations. Apple Mobility data shows US driving activity climbed 2.6% last week to the highest since the week ended Sept. 11, 2020. Driving activity was up more than 156% from year-ago levels. In contrast, lockdowns are continuing in Europe due to the slower pace of vaccinations, dampening transportation fuel demand. Senior market analyst Edward Moya of OANDA noted that news of a "possible" link to rare cases of blood clots from the AstraZeneca vaccine already has resulted in the United Kingdom halting that specific vaccine's distribution to those under age 30. "Europe's COVID vaccine rollout has been very disappointing and today's announcement that the UK will offer alternatives to people under 30 could lead to further vaccine hesitancy," Moya said. The European lockdowns have helped support gasoline arbitrage economics to the USAC. The arbitrage opened wide in February after several Texas refineries were brought down by unusually frigid temperatures. The USAC depends on gasoline from the US Gulf Coast, via the Colonial Pipeline, and from waterborne imports, primarily from Europe. USGC refiners were operating at 83.1% of capacity the week ended April 2, according to the EIA. That was unchanged on the week, but up from just 40.9% at the height of the Texas outages the week ended Feb. 26. Increased refinery runs helped boost USGC gasoline stocks last week by 838,000 barrels to 80.44 million barrels, putting stocks roughly on par with the five-year average, the EIA data showed.

Can a pipeline company defy a governor’s orders? Gretchen Whitmer is about to find out. As governor, Gretchen Whitmer vowed to provide clean and affordable drinking water for the Great Lakes state of Michigan. Last year, she implemented a statewide moratorium on water shutoffs to provide relief during the COVID-19 crisis, allocated $500 million dollars for improving water infrastructure, and in November stood by a campaign promise when she ordered Enbridge Energy to shut down its Line 5 pipeline, which carries crude oil and natural gas liquids under the Great Lakes from western Canada to Michigan and on to eastern Canada. Whitmer’s order gave Enbridge until May 12 to shut down Line 5. But the company has so far refused to comply, leading to a showdown between the biggest mover of oil in the United States, Enbridge, and one of the country’s emerging political leaders on climate, over land in her own state.     A review by the Michigan Department of Natural Resources last year found that Enbridge has repeatedly violated requirementslaid out in the 1953 easement that allowed it to build the pipeline, with infractions varying from not having the required support on the lake bed to inadequate corrosion control. Whitmer said in apress release that Enbridge “failed for decades to meet these obligations under the easement, and these failures persist and cannot be cured.”  Her order to shut down the pipeline follows years of concern from researchers, activists, and policymakers that Line 5 could seriously threaten Great Lakes fisheries and drinking water. The National Wildlife Federation found that the pipeline has spilledover 1 million gallons of oil and natural gas liquids in an estimated 30 spills to date. “Every day that pipeline lays on the lakebed, we’re a day closer to a catastrophe,” said David Holtz, an activist and coordinator for Oil and Water Don’t Mix, a coalition of Michigan organizations fighting to shut down Line 5 and support a clean energy transition.  There are also climate change concerns. To keep Line 5 operating, Enbridge has announced plans to build a protective tunnel over the part of the pipeline that crosses under the Great Lakes at the Straits of Mackinac, where Lake Huron and Lake Michigan meet. One of several permits for the tunnel construction was granted in late January this year. If it is completed, Enbridge would be allowed to use the pipeline for the next 99 years. But environmentalists and scientists argue that a long-term infrastructure plan to keep distributing and using fossil fuels runs counter to Whitmer’s 2050 carbon-neutrality goal and could derail U.S. climate change targets more broadly. Each day, the pipeline transports up to 540,000 barrels of fossil fuel.

Nessel, Whitmer file argument to keep Line 5 shutdown suit in state court ⋆ With just 36 days left until Gov. Gretchen Whitmer’s order for Canadian oil company Enbridge to shut down its controversial Line 5 pipeline goes into effect, the question of which court will preside over the state’s lawsuit to enforce the order is seeing some movement. Filed on March 16, the state’s 30-page motion to remand State of Michigan v Enbridge back to the 30th Circuit Court argues that the case should not be sent to federal court because there is no legal basis or jurisdiction for it to belong there. “The State pleads claims exclusively under state law, alleging that it properly revoked and terminated Enbridge’s Easement in the Straits of Mackinac for violations of both the public trust doctrine and the conditions and terms of the Easement,” the motion reads. Enbridge’s response to the state’s motion is due by April 28. Whitmer’s notice of revocation and termination will take effect on May 12, even if the court cases have not been concluded by then — but since Enbridge has made it clear that it does not intend to comply voluntarily, a court order will be needed to effectively enforce the shutdown. In November, Whitmer had directed Enbridge to shut down the existing dual pipeline by May 12 due to “repeated and incurable violations” of the company’s 1953 easement with the state. Enbridge’s core argument to remand the state’s case into federal court rests on its premise that the federal government, not the state, has the sole ability to decide whether a Line 5 shutdown is warranted. The company alleges that Whitmer’s order of revocation and termination “interferes with comprehensive federal regulation of pipeline safety,” burdens interstate and foreign commerce and more. The state, for its part — represented by Attorney General Dana Nessel — argues that there are much stronger arguments for keeping the case in state court. “The Complaint is founded exclusively on state law and addresses the legal validity of and Enbridge’s compliance with the 1953 Easement Agreement,” the motion reads, before outlining the ways in which the state believes its notice of revocation and termination is valid.Nessel then outlines four main arguments:

  • Enbridge has the burden of establishing federal court jurisdiction, which the state argues it cannot.
  • The state’s case does not necessarily arise under federal law, as no federal issues are raised by the state’s claims; furthermore, remanding the case to federal court would set a harmful precedent by radically expanding the scope of federal jurisdiction.
  • Enbridge cannot “shoehorn” the case into federal court based on its argument for “federal officer jurisdiction,” as its relationship with the Pipeline and Hazardous Materials Safety Administration (PHMSA) does not fulfill the requirements necessary to make this argument.
  • Enbridge’s invocation of “admiralty jurisdiction” — jurisdiction that usually arises from an accident in navigable waters and involves some aspect of maritime commerce — is not applicable, as the case at hand concerns contractual state agreements that are not maritime in nature.

Enbridge to Biden: Lake Michigan Pipeline Tunnel Fits U.S. Plans - - Enbridge Inc. wants to show the Joe Biden administration that the tunnel the Canadian company is building for its oil pipeline under Lake Michigan is exactly what the U.S. president’s plan for better infrastructure is all about.The tunnel project for the company’s Line 5, opposed by Michigan Governor and Biden ally Gretchen Whitmer, is the kind of upgrade that will make a crucial piece of infrastructure safer, Enbridge Chief Executive Officer Al Monaco said in an interview. The Calgary-based pipeline giant is engaging with the Biden administration to get that message across, he said.“Under the theme of ‘Build Back Better’ that the president has been talking about, it fits exactly,” Al Monaco said. “That’s what we are doing: We are modernizing an existing piece of infrastructure with a tunnel that reduces the risk to as close to zero as humanly possible, and we are doing it on our dime.”Enbridge is fighting Whitmer’s move last November to revoke an easement that permitted the pipeline to cross the lake bed, a decision that could force the system to shutdown by May. Meanwhile, Enbridge is pushing ahead with the tunnel project approved by Whitmer’s predecessor.Line 5 crosses the Straits of Mackinac between Michigan’s upper and lower peninsulas and supplies light oil and fuel to refineries and consumers in the U.S. Midwest and Canada.While the new U.S. president is aggressively seeking to promote spending on infrastructure, he has also canceled a key permit for the Keystone XL pipeline that would have carried Canadian oil sands crude from Alberta into the U.S.Al Monaco argues that blocking the existing Line 5 would trigger a crisis given its importance to Midwest refineries. The tunnel addresses concerns about potential oil spills into the water posed by ship anchors, for instance. A court-ordered mediation is scheduled to start on April 16.“It doesn’t make much sense to create a crisis when we have a solution there in the tunnel,” he said. “Protecting the Great Lakes is exactly what we’re doing.” Another project that Monaco says fits well with Biden’s goals is its Line 3. Enbridge is currently building a replacement to the aging cross-border pipeline with a new one that can pump increased volumes of Canadian crude into the U.S. Construction of the project in the U.S. only began in December after years of regulatory and legal delays. Protesters, including some indigenous groups, have regularly tried to disrupt construction, but Enbridge plans to finish the line on schedule, by year end. Horizontal directional drilling planned for the summer and eight pump stations are “on track,” he said. Canadian oil sands producers have struggled for years with a shortage of export pipelines, a situation that’s depressed prices for local crude oil. Projects to build new pipelines have faced environmental opposition and delays. But new pipelines such as the Line 3 replacement are being built, and large new project’s aren’t going to be needed, Monaco said.

One researcher’s quest to quantify the environmental cost of abandoned oil wells – Grist - Amy Townsend-Small has been chasing methane her entire professional life. The quest has taken her from Southern California freeways to sewage plants to animal feedlots. Sniffing out the potent greenhouse gas, which traps 86 times as much heat as carbon dioxide after it’s emitted into the atmosphere, has required her to breathalyze cows and take chemical measurements at large manure lagoons. When fracking took off around 2010, Townsend-Small shifted her focus to a new and growing problem: methane leaks from oil and gas activity.  The thousands of wells drilled, the millions of miles of pipelinethat transported natural gas, and the refineries that processed it all leaked methane. Natural gas plants emit about half as much carbon dioxide as coal plants, but without knowing how much methane leaks when extracting and moving natural gas, the true climate effects cannot be assessed.   Townsend-Small began trying to quantify just how much methane was leaking from wells and pipelines. She investigated whether methane from fracking sites may have tainted groundwater in rural Ohio and collected data on pipeline and compressor station leaks in Colorado. The work of Townsend-Small and other environmental scientists tracking greenhouse gases culminated in a 2018 study finding that 2.3 percent of the natural gas extracted in the country either leaked or was directly released into the air — the equivalent of the carbon dioxide emitted by all coal plants operating at the time.  In 2016, Townsend-Small found that 40 percent of unplugged wells she tested in Colorado, Wyoming, Ohio, and Utah were emitting methane. On average, each unplugged well was leaking about 10 grams of methane each hour, contributing the annual carbon equivalent of burning more than 2,400 pounds of coal each year. The EPA used her research to estimate that the nation’s approximately 3.1 million abandoned wells were spewing greenhouse gas emissions equivalent to burning more than 16 million barrels of oil. Such attempts to quantify methane emissions nationally come with fairly large margins of error, primarily because research on this front is scarce and what does exist is based on surveys in the Appalachian Basin. No two geological formations are the same, so without more detailed data from major oil- and gas-producing states, it’s impossible to say precisely the damage that abandoned wells may be doing to the planet. That’s why Townsend-Small recently set out to fill a Texas-sized hole in the research: The Lone Star State is the largest producer of oil and gas in the country and has thousands of abandoned wells, but its methane emissions have never been systematically measured.

The Permian Basin is ground zero to billions of dollars in zombie oil wells  - As oil and gas companies weathered volatile oil prices last year, many halted production. More than 1 00,000 oil and gas wellsin Texas and New Mexico are idle.Of these, there areabout 7,000 “orphaned” wells that the states are now responsible for cleaning up.But statistical modeling by Grist and The Texas Observer suggestsanother 13,000 wells are likely to be abandoned in the coming years. A conservative estimate of the cleanup cost? Almost $1 billion. And that doesn’t consider the environmental fallout.A decade ago, the U.S. oil industry experienced a brief renaissance with the advent of hydraulic fracturing, a new technology that allowed producers to unlock vast reserves of oil once thought to be unreachable. However, the COVID-19 pandemic reduced demand for oil at a time when there was already an oversupply of the fuel, disrupting the industry to a degree unseen in decades. Small, independent drilling companies have folded under extreme financial pressure. Even the big players, such as Exxon and Phillips 66, have slashed expenses. Just like in the ’80s, a massive wave of layoffs and bankruptcies has waylaid the industry. As of December 2020, 46 North American oil and gas production companies had filed for bankruptcy. The mighty Chesapeake Energy, a publicly traded company with $8.5 billion in annual revenue and drilling operations across the country, was the biggest one to fall. Experts predict the trend will continue.When an operator goes out of business, it’s the folks who live in the oil patch who are left with whatever mess the companies leave behind. Through the years, the Texas and New Mexico legislatures have made occasional attempts to address the growing problem of abandoned wells. The most substantial of these was in 1964 when Texas required companies to put bond money upfront to cover potential plugging costs. But even that didn’t stop the states’ ballooning inventory of orphaned wells.Weak bonding measures, lax enforcement of environmental and permitting rules, and legal loopholes have deepened the crisis. The state agencies responsible for overseeing the industry are severely understaffed, underfunded, and reluctant to hold operators accountable for letting wells sit idle. A review of the past 30 years of state records by Grist and the Texas Observer found that the New Mexico Oil Conservation Division inspects each oil and gas well only once about every two years. After a state Supreme Court ruling limiting the agency’s authority, it did not collect any fines for thousands of violations between 2011 and 2015. In Texas, the Railroad Commission classified just 0.04 percent of violations between 2015 and 2020 as “major” — a designation that comes with fines of up to $10,000 per day — even though operators were routinely leaving wells unplugged and spilling or leaking toxic oil and gas chemicals.

How Southwestern regulators failed to police the oil and gas industry - The fracking boom in the Permian Basin — which straddles West Texas and southeastern New Mexico — largely coincided with Republican control of much of New Mexico’s state government. Many of those elected to office in the early years of the shale rush promptly began dismantling barriers to extracting the most oil and gas at the cheapest price: Soon after winning the governorship in 2010, Republican Susana Martinez shuffled key employees in the environment department into positions where they had little expertise. During her eight-year tenure, the state legislature slashed the budget for the New Mexico Oil Conservation Division, or OCD, which oversees the oil and gas industry, by 25 percent. By 2018, half of all inspection and compliance positions were vacant.“Their budget was gutted,” said Stephanie Garcia Richard, a Democrat and the current land commissioner in charge of overseeing drilling on state lands. “They were casting about every which way [for money]. They were a regulatory body that had no teeth and had no funding.”Martinez’s Democratic successor, Michelle Lujan Grisham, has since made attempts to restore regulatory funding. Nevertheless, at present the two OCD districts overseeing a large portion of the Permian Basin have just seven inspectors to cover more than 50,000 square miles — an area larger than the size of PennsylvaniaOil and gas well inspections ensure that operators are playing by the rules: checking that wells aren’t leaking underground, that there haven’t been spills, and that operators have appropriate signage around well sites. But a review of more than three decades of state records by Grist and the Texas Observer shows just how rare such inspections have become. Since 1988, OCD has inspected each oil and gas well about every two years on average. And inspections are becoming even more infrequent: While the agency averaged about 52,000 inspections each year during the Martinez administration, only about 30,000 were done in 2019 and 41,000 in 2020.  Across the border in Texas, there are 405,000 more oil and gas wells, but enforcement — which is conducted by the misleadingly-named Railroad Commission — is similarly sparse. An analysis of the Commission’s enforcement data by Grist and the Texas Observer found that the agency conducts about 140,000 inspections a year and issues about 32,000 violations. The vast majority of these violations are for leaving wells unplugged despite years of inactivity, not cleaning up spills and leaks, and for not posting the right signage next to a well. They are all for the most part considered “minor” violations by the state. Of the 178,141 violations issued since 2015, just 73 — 0.04 percent — were considered “major” violations, which carry fines of up to $10,000 per day. Most violators do not face fines. The agency’s data show that less than 10 percent of violations are referred to its legal department for enforcement.New Mexico’s OCD reports both on-site field visits and file reviews as inspections but does not differentiate between the two. It’s unclear exactly how many inspections were conducted in person, but the New Mexico data suggest that a significant number are done from a desk — which could be a problem, since it’s hard to identify an oil leak or see a piece of faulty equipment without inspecting the actual well site. OCD inspectors each conducted around 3,000 inspections on average every year since 2016, which works out to about 11 inspections per day.

U.S. House bill seeks $8 billion for abandoned oil and gas well cleanup - (Reuters) - A U.S House of Representatives Democrat introduced a bill on Thursday authorizing $8 billion to plug and clean up abandoned oil wells nationwide, a measure aimed at creating jobs for oil and gas workers and reducing climate-warming emissions. More than a century of oil and gas drilling has left behind millions of abandoned wells here, many of which are emitting methane, a potent greenhouse gas, into the atmosphere. Oil and gas companies are likely to abandon many more wells as demand for clean energy replaces that for fossil fuels. The bill, sponsored by Representative Teresa Leger Fernandez, comes a week after President Joe Biden’s administration unveiled a $2 trillion infrastructure proposal - dubbed the American Jobs Plan - that called for a $16 billion investment to plug orphaned wells and clean up abandoned mines. The Biden initiative is aimed in part at providing work for oil and gas employees likely to be displaced by a move away from fossil fuels because of climate change. Leger Fernandez said in an interview that her bill “does the two things that the American Jobs Plan is looking at, which is both create jobs and address some of the pressing national problems we have.” Her bill would provide $7.25 billion in grants for well cleanups on state and private lands and $700 million for plugging on public and tribal lands. State eligibility for the grants would be tied to various metrics, including the ability to put people to work quickly, a state’s oil and gas job losses, the number of abandoned wells and efforts to tighten plugging regulations, reduce methane emissions and boost spending on cleanups. Leger Fernandez’s home state of New Mexico is a major oil and gas producer. The bill would also raise bonding amounts, the money that drillers must pay to cover cleanup costs if they go bankrupt, for companies with wells on public lands. The U.S. Government Accountability Office has said that existing levels are not sufficient, leaving taxpayers on the hook for cleanups. Bonds for wells on a single lease would rise to $150,000 from $10,000, while bonds for all of a driller’s wells in a state would go to $500,000 from $25,000. Companies would also be required to pay new fees for idle wells on public lands.

Inside the Dirty, Dangerous World of Carbon Flooding  -- Around the world, scientists and advocates call for keeping carbon in the ground as a means of staving off climate change. But in the Southwestern United States — mainly in Colorado and New Mexico — a mainstay of obtaining more oil is facilitated by doing the exact opposite: drilling pure reserves of carbon dioxide out of the ground.After it’s extracted from these natural-source underground fields, the gas then gets piped to the Permian Basin, the nation’s top-producing oil fields of West Texas and southeastern New Mexico. There, oil companies use the CO2 to flood their wells, forcing the last dregs of crude to the surface in a process also known as enhanced oil recovery, or EOR.Carbon flooding is often described as a way of helping recover available oil, providing power while the energy sector transitions away from fossil fuels altogether. Sometimes, oil companies mention it alongside questionable carbon capture technology, suggesting that pulling CO2 from the atmosphere and pumping it underground into oil wells for permanent storage — and to loosen up remaining crude for extraction — would facilitate “carbon neutral” oil production. However, that picture of carbon flooding is a futuristic fallacy. The first barrel of so-called carbon neutral oil was produced only earlier this year by Occidental Petroleum. And it relied on carbon offsets, rather than direct capture of CO2 and injection into wells. The reality is that this little-known process uses mostly CO2 extracted from natural sources where it would’ve otherwise remained safely underground — not risking emission into the atmosphere nor furthering the use of planet-warming fossil fuels.While the industry remains out of view of even many dedicated observers and watchdogs, it has existed for four decades and its scale is massive. Occidental Petroleum — a Houston-based corporation that recently rebranded itself as a“carbon management” enterprise, despite being one of the top greenhouse gas emitters in history — says that it injects 2.6 billion cubic feet of CO2 per day into its Permian fields. The company is the largest leaseholder and one of the top producers in the Permian in both New Mexico and Texas. It drilled 13% of the basin’s production in 2015 and has said it foresees billions more in oil production from future CO2 floods.

US oil, gas rig count jumps 9 to 528, with activity hike in smaller basins: Enverus — The US oil and natural gas rig count jumped nine to 528 in the week ending April 7, rig data provider Enverus said, as drilling activity pulled back slightly in the giant Permian Basin but increased in a handful of smaller basins.  The Eagle Ford Shale in South Texas gained two rigs from the previous week for a total 43. The SCOOP/STACK of Oklahoma (19 rigs), the Bakken Shale (15) in North Dakota and Montana, the DJ Basin (14) in Colorado and the Utica Shale (13), mostly in Ohio, each gained a rig.The Permian, sited in West Texas and New Mexico, lost a rig during the week, leaving 235.Horizontal rigs that typically "move the needle" in terms of US shale production was flat week on week at 420, said Andrew Cooper, quantitative US supply analyst with S&P Global Platts Analytics.Cooper added Permian rigs "appeared to flip-flop from the Midland to the Delaware Basin this week," with some rigs shifting from the Permian's eastern to the western sub-basin.The majority of rigs added in the past week were in basins other than the eight largest shale plays and were for vertical wells that commonly have initial production rates much lower than horizontal wells, Cooper said. Operators in those basins usually are smaller companies. Oil rigs at highest level in a yearThe past week was the first time the oil rig count cracked the 400-mark since mid-April 2020, when upstream operators were shedding rigs after a steep oil price drop in early March as the pandemic hit the market. The nationwide total rig count reached 838 in the first week of March, but plummeted 67% in the following four months before starting to slowly inch back up.So far, the US fleet has regained 249 rigs since the fall from March 2000, less than half the 559 it lost.Investment bank Goldman Sachs expects the total US oil and gas rig count to expand by an incremental 65-85 rigs by year-end 2021, with the "most upside" in the Permian at an incremental 35-45 rigs from the current count.The investment bank also sees five to 10 incremental rigs in the Eagle Ford Shale by year-end 2021, three to five incremental rigs in the DJ-Niobrara, two to three incremental rigs in the Haynesville Shale, and one to two incremental rigs in the SCOOP/STACK.U.S. crude output to decline more than previously forecast in 2021: EIA -- (Reuters) - U.S. crude oil production is expected to fall by 270,000 barrels per day (bpd) in 2021 to 11.04 million bpd, the U.S. Energy Information Administration (EIA) said on Tuesday, a steeper decline than its previous forecast for a drop of 160,000 bpd.The agency said it expects U.S. petroleum and other liquid fuel consumption to rise 1.32 million bpd to 19.44 million bpd in 2021, compared with a previous forecast for a rise of 1.41 million bpd.

Occidental CEO Rejects U.S. Carbon Tax in Break With Big Oil -  Occidental Petroleum Corp. has split from some of its larger rivals by rejecting a potential U.S. carbon tax, saying that it prefers the existing system of tax credits designed to encourage oil companies to store carbon dioxide and reduce emissions. The position appears to stand in contrast with that of supermajors like Exxon Mobil Corp. and the American Petroleum Institute industry group, which voted last month to endorse putting a tax or other price on carbon dioxide emissions to replace other greenhouse gas regulations. Independent producers and refiners have long been opposed to such a levy. “A carbon tax would be bad for a lot of the industry, a carbon tax would be bad for the consumers and especially for those consumers who are more disadvantaged from an economic standpoint,” Occidental Chief Executive Officer Vicki Hollub said at a conference hosted by Texas Independent Producers & Royalty Owners Association Tuesday. “A carbon tax is not what we’re pushing at all.” Occidental has attempted to position itself as one of America’s more climate-forward oil producers, making its opposition to a carbon tax more noteworthy. The Houston-based company was the first large U.S. oil producer to announce a goal to reach net- zero carbon emissions by mid-century and has ambitious plans to build in Texas the world’s biggest facility to store carbon captured directly from the atmosphere. Last month, API said its support for a carbon tax hinges on replacing existing regulations on greenhouse gases -- a trade-off seen as key to luring support from Republicans on Capitol Hill. But Occidental’s CEO sees such a measure as punitive for the industry. Instead, Hollub prefers the 45Q tax structure that gives companies credit for capturing carbon and storing it underground. She also praised California for its low-carbon fuel standards, saying they functioned better than Europe’s policy of limiting emissions and trading allowances. 

JPMorgan Secretly Emailed the Trump Administration About Bailing Out the Oil Industry –   - In October, top executives at JPMorgan Chase wrote in an op-ed for Fortune that the “clock is ticking” on the climate crisis and that JPMorgan planned to be part of the solution. The bank, they said, would align its immense financing portfolio to meet the Paris climate goals in the oil and gas, electric power, and automotive sectors.   Environmental watchdogs have had their doubts about JPMorgan’s commitment—not least because the bank at the time had on its board of directors the former ExxonMobil CEO Lee Raymond, a longtime climate skeptic who led thecorporation when it aggressively fought government action to address climate change. Recently, in a report on fossil fuel financing by the climate group Rainforest Action Network, JPMorgan Chase earned the distinction as the “worst banker of fossil fuels” between 2016 to 2020, financing nearly $317 billion for the fossil fuel industry in that period, including oil and gas drilling in the Arctic and tar-sands extraction in Canada.  For example, the executives proposed a program modeled after the student loan TARP program to give the banking sector an injection of government-backed equity when it was facing steep losses. The bank undercuts its climate promises in important ways that are less visible to the public. The environmental group Friends of the Earth obtained emails from last April between JPMorgan Chase and top Treasury Department officials through a Freedom of Information Request and subsequent lawsuit. The batch of emails show JPMorgan requesting changes to government lending programs meant to help smaller and medium-sized businesses weather the economic fallout of the pandemic. They also capture an unusual snapshot of Wall Street’s interdependence on the future of fossil fuels. In March 2020, Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act, providing $454 billion to the Federal Reserve to support businesses. The move also gave then-Treasury Secretary Steven Mnuchin broad powers to adjust the terms of the lending as he saw fit. Three weeks after the law passed, a top executive at JPMorgan forwarded on an email to then-Treasury deputy secretary Justin Muzinich that outlined two items under the subject line, “MSL industry review and Oil and Gas Banking Commentary.” Part of the email referenced the Main Street Lending Program, called by the shorthand MSLP, targeting small- and medium-sized businesses that were left out of other COVID relief packages. The same email includes a frank discussion of the ways the government could directly support bailouts for the oil and gas sector, and protect banks exposed to heavy losses when oil prices were in free fall. One JPMorgan employee, Travis Machen, the head of Financial Institutions Corporate Client Banking, wrote, “Numerous banks, largely scattered across the South, have meaningful direct exposure to oil and gas (generally ranging from ~3-11% of total loans)” with fewer than 50 banks having “measurable direct exposure to the oil and gas sector.”

Fossil fuel subsidies among targets of Biden's $2.3 trillion infrastructure plan --President Joe Biden has unveiled a $2.3 trillion infrastructure plan that aims to relay the foundations of the US economy while also addressing the climate crisis, although some of the proposals — which include an attack on fossil fuel subsidies — may be difficult to carry into law. Biden presented his plan last week in Pittsburgh, the economic epicentre of the Marcellus and Utica shale plays and heart of the US steel industry. He trumpeted the proposals as a "once-in-a-generation investment" that will lead to "good-paying jobs" while helping to "grow the economy". One of the main thrusts of the plan” is $350 billion in tax credits and federal funding for electric vehicles and associated infrastructure and electric grid modernisation. Billions more would be made available for clean energy generation and storage and for building and retrofitting energy-efficient houses, schools and other public buildings. The “American Jobs Plan” covers generous investment in traditional infrastructure such as roads and bridges, but also includes measures intended to help oil industry workers adapt to the energy transition. Biden’s bill offered immediate up-front investment of $16 billion to put the energy industry to work plugging orphaned oil and gas wells and cleaning up abandoned mines. The Environmental Protection Agency pegs the number of abandoned hard-rock mines in the US at about 500,000, and the number of unplugged inactive wells at about 2 million. These wells can leak methane into the atmosphere, by some estimates emitting as much carbon pollution as 2 million passenger vehicles per year. Biden’s job-creation hopes were supported by a joint paper from Columbia University, which estimates that a significant federal effort to plug about 500,000 orphaned and abandoned oil and gas wells could provide as many as 150,000 jobs. Biden’s funding requests include $35 billion for “technology breakthroughs addressing the climate crisis” and $15 billion for “demonstration projects” for climate research and development priorities. His proposal calls for the creation of 10 “pioneer facilities” intended to demonstrate carbon capture retrofits at large-scale cement and chemical production facilities. The White House said the administration intends to capitalise on existing legislation and tax programmes to make carbon capture more attractive to industry. The White House plans to pay for the proposals by raising corporate taxes to 28% from 21% and eliminating tax breaks for fossil fuels. Although Biden did not flesh out the details of how the administration would claw back revenue by ending tax relief for oil companies, a 2017 congressional joint committee on taxation said eliminating direct tax breaks for intangible drilling costs would generate $1.59 billion in revenue in that year, or $13 billion over ten years. For percentage depletion — an accounting method that works like value depreciation — the joint committee said ending relief for coal, oil and natural gas would generate $12.9 billion over ten years. 

Senator Bernie Sanders wants fossil fuel execs to testify to the budget committee - CBS NewsSenator Bernie Sanders, chairman of the Senate Budget Committee, has called on three oil and gas executives to testify next Thursday at a hearing on climate change. BP America Chairman and President David C. Lawler, Chevron CEO and Chairman Michael Wirth and ExxonMobil Chair and CEO Darren W. Woods were invited to participate in a hearing titled, "The Cost of Inaction on Climate Change."  In an interview with CBS News, Sanders said that Lawler already declined the request, sent Tuesday. BP America declined to comment to CBS News. Lawler declining "tells me that these guys don't want to answer hard questions," said Sanders. He pointed to past examples of oil and gas companies withholding and distorting information to the public in order to make their production appear less dangerous. Sanders called this "one of the scandals of our lifetime." "These companies are producing a significant percentage of the carbon that we use, which is destroying our planet, and we want to know what they are doing to transform their companies away from fossil fuel," Sanders said.

Black Hills customers face massive rate increases to cover $80 million in cold snap costs --Black Hills Energy customers in Nebraska are facing some significant rate increases to pay for costs the company incurred to keep furnaces and fireplaces running during the extreme cold in February.Black Hills officials told the Nebraska Public Service Commission during a workshop Tuesday that the utility spent $80 million in Nebraska to purchase natural gas Feb. 12-18 —  more than it spends in a typical year. Over the past five years, the company never spent more than $13 million on gas for the entire month of February.By law, Black Hills, which has more than 300,000 customers in Nebraska, the bulk of which are in Lincoln, is allowed to recoup the cost of the natural gas it provides to customers, and in the case of the February cold snap, the costs are astronomical.Douglas Law, Black Hills' associate general counsel in Nebraska, said it paid prices on the spot market as high as $381 per dekatherm of natural gas during the cold snap. That's compared with prices of about $3 per dekatherm earlier in February. A dekatherm is 1 million British thermal units.Robert Amdor, manager of regulatory services for Black Hills, said the company experiences a significant winter cold snap about once every five years, but he said that in his 30 years he has never seen one as significant as the one in February. He said it was "unique" because of how cold it got, how wide of an area experienced the cold and how much it drove up demand for natural gas.In Lincoln, overnight temperatures dipped below zero on 11 consecutive days, capped by a minus 31 reading Feb. 16 that is the coldest temperature ever recorded in Lincoln in February.The freezing temperatures extended to the Gulf Coast and demand caused unprecedented disruptions to the power grid, as well as rocking the natural gas market."This event was far beyond any we've experienced in the past," Amdor said.Overall, across its six-state territory, Black Hills had more than $600 million in additional energy costs during the cold snap. Now the company is working with regulators in those states to lessen the burden on customers by spreading out the bills to cover those additional costs over years.

'No one explained': fracking brings pollution, not wealth, to Navajo land  It’s not clear why the water line broke on a Sunday in February 2019, but by the time someone noticed and stopped the leak, more than 1,400 barrels of fracking slurry mixed with crude oil had drained off the wellsite owned by Enduring Resources and into a snow-filled wash. From there, that slurry – nearly 59,000 gallons – flowed more than a mile downstream toward Chaco Culture national historical park before leaching into the stream bed over the next few days and disappearing from view. The rolling, high-desert landscape where this happened is Navajo Nation off-reservation trust land, in rural Sandoval county, New Mexico. Neighbors are few and far between, and they didn’t notice the spill. The extra truck traffic of the cleanup work blended in with the oil and gas drilling operations along the dirt roads in that part of the county. Then three days after the spill, something ignited and exploded 2,100 feet away on another wellsite owned by Enduring Resources, starting a fire that took local firefighters more than an hour to put out. The two accidents account for just 1% of oil- and gas-related incidents in north-western New Mexico in 2019, according to statistics kept by the New Mexico oil conservation division (OCD). Since those two, there have been another 317 accidents in the region as of 29 March, including oil spills, fires, blowouts and gas releases. There were 3,600 oil and gas spills over the previous decade, both smaller and larger. In both cases in February 2019, the people living closest to the accident sites were among the last to know what happened. Daniel Tso, chairman of the health, education and human services Committee of the Navajo Nation Council, chalks up the lack of communication to a prevailing attitude he sees among outsiders working on Native American lands: “Oh, it’s on Indian land. Don’t worry about it.” Because, historically, few outsiders have. ... North of the highway is land called Dinétah, the center of the Navajo people’s creation story. The Navajo call themselves Diné, which means “the People”. ‘Their greed is gonna kill us’   On the south side of the highway, a hand-painted sign reads “Entering Energy Sacrifice Zone” next to the turnoff to the spider web of muddy, snowy, rutted dirt roads that string together the homes and drilling rigs and wells in the area. It takes a vehicle with four-wheel drive to confidently navigate here. That’s what the oilfield workers drive, if they aren’t driving semis. “It’s really hard to come here,” says Mario Atencio, a legislative district assistant with the Navajo Nation Council.

Haaland on public lands drilling: Taxpayers deserve 'a return on their investment'  Interior Secretary Deb Haaland said Friday that taxpayers deserve “a return on their investment” when asked what changes or different approaches are needed for the country’s oil and gas program. Currently, the Biden administration has paused new leasing on federal lands and waters “pending completion of a comprehensive review and reconsideration of federal oil and gas permitting and leasing practice.” An interim report is expected to be completed this summer. Asked what changes need to be made to fix the oil and gas leasing program, Haaland told reporters that “the American taxpayers deserve to have a return on their investment.” “Because the program hasn’t been reviewed in a long time, they’ll be looking at a lot of things,” she added of federal scientists. “We have an obligation to make sure that this industry does the best it can for the American people.” While on the campaign trail, President Biden called for banning new permits for oil and gas on public land and waters and adjusting fees paid to the government for these activities to account for climate costs. It’s currently unclear whether these changes will be pursued. Asked what Trump administration changes will be on the top of her list to reverse, Haaland said, “I don’t know what to say. There’s so much ... there are a number of those issues that we want to look at.” She mentioned rollbacks to protections for endangered species and migratory birds as among those she’d take on. “I am positive that whatever we feel needs to be changed or reversed, that we’ll do that according to the science,” Haaland added. The Interior Department has already said it would aim to reverse the Trump administration’s changes that removed penalties for industry when they accidentally or incidentally kill migratory birds. Haaland also addressed reports that chief of staff Jennifer Van der Heide had been reassigned after planning a 50-person party that was eventually canceled, saying she’ll be “remaining on my senior staff.” She said the same of Elizabeth Klein, who Biden had planned to nominate as Haaland’s No. 2. The White House later reversed, saying it would not nominate Klein amid reports of disagreement from Sens. Lisa Murkowski (R-Alaska) and Joe Manchin (D-W.Va.).

EPA proposes settlement in Wyoming oil spill -- The U.S. Environmental Protection Agency (EPA) recently announced a Clean Water Act (CWA) settlement with Burlington Northern Santa Fe Railway Company (BNSF) in which the company has agreed to pay $140,000 for alleged Clean Water Act violations associated with a discharge of oil into the North Platte River near Guernsey, Wyoming. EPA alleges that BNSF violated Section 311(b)(3) of the CWA, 33 U.S.C. § 1321(b)(3) with discharges of 5900 gallons of diesel fuel and 800 gallons of lubricating oil into the North Platte River. The discharges occurred on February 4, 2019, in Wendover Canyon, northwest of Guernsey; due to a derailment of three locomotives and five rail cars owned by BNSF. The sources of the diesel and oil were two of the derailed locomotives.  BNSF reported the spill to the National Response Center (NRC) and an EPA On-scene Coordinator was dispatched to the spill site.  BNSF worked with the State of Wyoming and EPA to clean up the spill.  The Clean Water Act prohibits the discharge of oil or hazardous substances to waters of the US or their adjoining shorelines in quantities that may be harmful to public health or the environment and is administered by EPA and the Coast Guard. For more on the Clean Water Act’s prohibition against discharges of oil into waters of the U.S. and SPCC regulations, visit: https://www.epa.gov/compliance/clean-water-act-cwa-compliance-monitoring#oil. This proposed Consent Agreement is subject to a 30-day public comment period and final approval by the EPA’s Regional Judicial Officer.  The public comment period began March 24th and ends on April 23rd.  To access and comment on the Consent Agreement , visit: https://www.epa.gov/publicnotices/notices-search/location/Wyoming

Phillips 66 pulls out of deferred Liberty Pipeline project — Phillips 66 Partners is officially pulling out of the long-deferred Liberty Pipeline project that was designed to move 350,000 b/d of crude oil from the Rockies and Bakken Shale to the benchmark Cushing, Oklahoma, hub, the company said. The Phillips 66 Partners-led pipeline project was put on indefinite hold more than a year ago when the pandemic crushed global crude oil demand and, since then, the US energy sector has kept tight reins on capital spending. Phillips 66 Partners will record an estimated impairment of between $180 million and $210 million in the first quarter for pulling the plug on the long-dormant project, it said in a statement April 5. The pipeline would have stretched 700 miles from Guernsey, Wyoming, to Cushing, including a connection to a previously proposed Platteville, Colorado, terminal. Phillips 66 Partners' joint-venture partner Bridger Pipeline and its parent, True Companies, did not respond to requests for comment, but Bridger already is exploring pipeline alternatives with new partner Tallgrass Energy through recently launched open seasons. The decision on the Liberty Pipeline is not surprising considering that Phillips 66 in October canceled the planned Red Oak Pipeline from Cushing to the Texas Gulf Coast. Red Oak and Liberty were both proposed and, subsequently, deferred at the same times. So, when Red Oak was killed, it seemed like a similar result for Liberty could follow. Both the Red Oak and Liberty pipelines were originally scheduled to be in service in the first quarter of 2021. While US crude oil production remains depressed since the beginning of the pandemic, there is the potential for more alternate pipeline demand from the Bakken if the main crude oil artery, the Dakota Access Pipeline, is ordered shut. The next federal court hearing on the potential DAPL closure is scheduled for April 9. Bridger and Tallgrass count among those exploring both DAPL and Liberty alternatives, although Bridger technically could still seek a new JV partner for the Liberty project.

Enbridge CEO Confident of Line 3 Completion in Minnesota by Year’s End - Enbridge Inc. still expects to complete and begin service by the end of the year on the contested $2.6 billion leg of the Canadian oil export pipeline now under construction across 240 miles in Minnesota, CEO Al Monaco said Wednesday. “Work is on schedule” for Enbridge Line 3, Monaco said at a Scotiabank CAPP Energy Symposium held by the investment bank with the Canadian Association of Petroleum Producers. “We’re making sure we’re living up to the letter of the permits.” Canadian exporters, led by the country’s top natural gas user, Alberta thermal oilsands production, are forecast to gain 370,000 b/d of capacity with the updated Enbridge system. The pipe construction replaces a 53-year-old system to enable higher operating pressure. Other legs of the total $9 billion, 1,031-mile program are complete in Canada, North Dakota and Wisconsin. Final construction began last fall after the Minnesota Pollution Control Agency, Minnesota Public Utilities Commission (MPUC) and U.S. Army Corps of Engineers granted permits that ended a six-year regulatory ordeal. Monaco acknowledged that pipeline foes continue to fight Line 3 with court challenges and demonstrations along the Minnesota right-of-way by protestors that include the Water Protectors and native rights champions. The groups hold prayer ceremonies and members have chained themselves to project hardware on the right-of-way. An 18-county police squad called the Northern Lights Task Force, created by the MPUC with Enbridge directed to pay its costs as an approval condition, is tasked with reopening obstructed work sites and removing interfering protesters. Environmental and tribal opponents of the project lost winter fights for stop-work injunctions in the Minnesota Court of Appeals and U.S. District Court for the District of Columbia. The protesters have vowed to pursue their cases. A verdict is awaited from the Minnesota high court on an appeal that Democrat Gov. Tim Walz directed the state commerce department to file against the MPUC project approval. The complaint said the MPUC erred by using Enbridge delivery contracts as a proxy for U.S. oil demand.

Update On Natural Gas Pipelines Along North Dakota / Minnesota State Line -- After a three-month winter break, work on the $8.5 million Dakota Natural Gas pipeline project in Traill County, N.D., ramped up again in March.The project, which unanimously was approved by the North Dakota Public Service Commission in September, will connect to the Viking Gas Transmission line in western Minnesota and deliver natural gas to commercial and residential customers in the Traill County, in cities of Hillsboro and Mayville and to rural customers along the route. The 63-mile pipeline will be made of steel, except in Hillsboro and Mayville, where it will be high-density plastic. About 750 commercial and residential customers in Traill County will be able to access the pipeline if they choose to do so. Last year, Dakota Natural Gas finished a $4 million pipeline project in Drayton, N.D., where customers included American Crystal Sugar Co. Meanwhile, representatives of Dakota Natural Gas also are studying the possibility of installing natural gas pipelines to the Traill County cities of Portland and Hatton. Nearly all of the pipeline on the North Dakota side of the Traill County project has been laid, and work soon will begin on the Minnesota side.

Exxon sues Energy Transfer over charges from pipeline dispute --Exxon Mobil Corp’s XTO Energy shale unit filed a breach of contract lawsuit against Energy Transfer LP over disputed payments for the Dakota Access Pipeline, according to a Texas state court filing.  The suit alleges the pipeline operator hit XTO with deficiency charges and revoked other credits after the oil producer shifted some oil to other outlets last August. Exxon took the actions after a U.S. court ordered Dakota Access Pipeline (DAPL) shut, it said. Exxon asked a state court in Houston last week to award it damages exceeding $1 million, a return of its revoked credits, attorneys fees and other costs.n Energy Transfer and Exxon both declined to comment.

Fate of Dakota Access pipeline at stake at Friday court hearing (Reuters) - The fate of the Dakota Access pipeline could be decided at a U.S. court hearing Friday, where federal regulators could set in motion a months-long shutdown of the line while the Biden Administration completes an environmental review.The market has been increasingly worried about a possible shutdown as the White House aims to reduce the nation’s reliance on fossil fuels and address concerns of minority communities harmed by carbon emissions. Biden’s administration has restricted oil-and-gas leasing on federal lands and cancelled permits for the proposed Canada-to-U.S. Keystone XL line and a U.S. Virgin Islands refinery expansion.Energy Transfer’s Dakota Access Pipeline (DAPL) ships up to 570,000 barrels of North Dakota’s crude production to the U.S. Midwest and Gulf Coast. It has been in danger of shutting down since a D.C. court threw out a key permit last summer that allowed it to operate under a water source used by Native American tribes.The U.S. Army Corps of Engineers, which is in charge of issuing permits for pipelines to travel under waterways, is expected to detail plans for DAPL at the hearing before the U.S. District Court for the District of Columbia.

Bakken crude to be rerouted in every direction if DAPL shuts | S&P Global Platts— Bakken Shale crude oil volumes would ship to the west, east and even up north into Canada and back into the US again as producers and pipeline operators target alternative routes if the Dakota Access Pipeline is shuttered, even temporarily, according to industry sources. A federal court could decide as soon as April 9 whether the Bakken Shale's main crude artery is forced to close, dispersing the volumes from the four-year-old, 570,000 b/d pipeline to other existing pipelines, lightly used crude-by-rail networks, and trucking routes, and widening Bakken crude price discounts. If the Energy Transfer-operated pipeline is ordered shut, energy analysts believe drastic measures will not become necessary so long as the closure is temporary only through the back half of the year. The US Army Corps of Engineers' court-ordered Environmental Impact Statement study could put DAPL back into good legal standing by the end of 2021 or early 2022, although an unprecedented permanent closure would have much bigger long-term impacts. With Bakken crude production and activity already diminished from the ongoing coronavirus pandemic and, to a lesser extent, DAPL uncertainty, a temporary closure would keep projected Bakken production growth from occurring, but it would not trigger substantial reductions in volumes, analysts said. "The industry had a lot of time to consider alternate routes," said Colton Bean, midstream analyst for Tudor, Pickering, Holt & Co. "Is it going to be a disaster scenario? No. It's more of a cap on growth than a big impact on existing production." With the potential loss of DAPL capacity, analyst consensus mostly expects at least 200,000 b/d to move to existing pipeline alternatives, about 200,000 b/d more to crude-by-rail, and up to another 100,000 b/d or so in increased trucking volumes. Some analysts predict crude-by-rail volumes could even grow by at least 300,000 b/d with some modest optimization and expansion work. Some of the big volume gainers would include the True Companies' Butte and Belle Fourche pipelines system from the Bakken to Guernsey, Wyoming; Kinder Morgan's Double H Pipeline to Guernsey; Enbridge's Bakken pipeline system to Illinois and Cushing, Oklahoma; Enbridge's Platte Pipeline from Casper, Wyoming, and Guernsey to Illinois; and Tallgrass Energy's Pony Express Pipeline from Guernsey to Cushing. The major rail networks from the Bakken to the US Gulf Coast's refining and export hubs are BNSF and the joint Canadian Pacific Railway and Kansas City Southern networks, which are merging as part of a $25 billion acquisition. Crestwood Equity Partners' prime COLT rail and trucking hub in the Bakken also stands to benefit. Even pipeline systems from North Dakota to Canada, such as Enbridge Line 26 and Plains All American Bakken North, could be utilized to move crude north and then back into the US through Enbridge's Mainline network and others. "In a normal world, you probably wouldn't be shipping crude north into Canada to bring it back into the US,"

Hoeven believes key priorities for oil and gas can still be won despite Biden administration --Among top priorities for Sen. John Hoeven right now is working behind the scenes to assure uninterrupted operation of the Dakota Access pipeline while a court-ordered Environmental Impact Statement is being prepared. Hoeven told a group of energy industry leaders on Wednesday that he worked with Chairman Mark Fox on getting a tribal consultation on the Dakota Access pipeline, and that he has also been talking with the Corps about the situation, as well as colleagues on the Energy Committee, such as Senator Joe Manchin, the Democratic senator from Virginia. “The key is that we can keep the Corps — they want oil to continue to flow while they do their EIS. And if we can just keep them on track and operating the pipeline, and then completing that EIS within something less than a year now, that’s a huge step,” Hoeven said. Hoeven said the Three Affiliated Tribes have a strong case with the federal government when it comes to Dakota Access, with around 230,000 barrels of oil coming off their reservation and traveling in that pipeline. “(The federal government) has a fiduciary duty to protect trust assets,” Hoeven said. “And they have a trust relationship with the tribe, so I’m hoping that’s helpful.” Hoeven said the Corps and Energy Transfer are taking additional safety precautions for the pipeline to try to accommodate concerns from the Standing Rock Sioux in North Dakota, as well as tribes in South Dakota. “This is something where we gotta work together, so it doesn’t get to be just looked at in a partisan way,” Hoeven said. “That’s what we want to stay on. The Corps is on track to continue to have it operate and complete the EIS. That’s the key. And that’s why we’re trying to keep i tin this framework, so neither the administration nor the courts, can come in and get it into more of a partisan fight.”

Canada's Enerplus to buy some of Hess' North Dakota assets (Reuters) - Canada's Enerplus Corp said it would buy some assets in North Dakota's Williston Basin from Hess Corp for $312 million, as improved oil price expectations have buoyed mergers and acquisitions in North America. Canada's oil and gas sector had a record start to 2021 in terms of mergers and acquisitions as the energy sector benefits from a rebound in oil prices from the pandemic-led crash last year, and as smaller companies bet on economies of scale. Enerplus said it will buy 78,700 net acres in North Dakota, adjacent to its current core Bakken acreage, with about 6,000 barrels of oil equivalent per day (boepd) of working interest production from Hess. The acquisition of largely undeveloped land has expanded Enerplus' drilling inventory in the play by two to three years, Scotiabank analysts wrote in a note, adding its five-year plan to grow production modestly and emphasize free cash flow will likely be well received by investors. The deal, expected to close in May, will add to Enerplus' adjusted free cash flow per share and net asset value in the first year, Enerplus said. The company raised its output guidance for the year to between 111,000 and 115,000 boepd, from 103,500 to 108,500 boepd, due to the acquisition as well as strong operating performance in North Dakota and higher-than-expected production in Pennsylvania's Marcellus region. It also raised its 2021 spending plans to $360 million to $400 million from $335 million to $385 million. For Hess, the sale of the acreage, which it was not planning to drill before 2026, strengthens its cash and liquidity position. Last month, the company agreed to sell stakes in the two Danish oilfields to chemicals and energy group INEOS for $150 million.

M&A in U.S. oil and gas to hit $3.4 billion in Q1 2021 -Mergers and acquisitions in the upstream segment of the U.S. oil and gas industry hit $3.4 billion in the first quarter of the year, Reuters has reported, citing data from Enverus, the energy consultancy.The value of the deals in the first quarter compares with $600 million for the first quarter of 2020 but is less than the $27.8 billion in deals recorded for the fourth quarter of 2020.The five biggest deals last quarter involved a private company, Enverus noted in its report. These included Pioneer Natural Resources’ $6.4-billion acquisition of privately owned DoublePoint and Energy Transfer’s takeover of Enable Midstream Partners for $7.2 billion. Norway’s Equinor also made a deal with a private company last quarter—it sold oil-producing assets in the Bakken play to Grayson Mill Energy, a firm backed by private equity money. In February alone, mergers and acquisitions in the U.S. oil and gas upstream space totaled 35, up 12.9 percent on January but down 25.53 percent on the 12-month average, figures from GlobalData showed.According to a senior Enverus analyst, the uptrend will continue. Andrew Dittmar added that private companies are becoming more willing to buy now that oil companies’ stock prices are rising and they are looking to offload non-core assets.The pandemic that shook the oil and gas industry last year unleashed a wave of consolidation deals as companies grappled with the new reality of demand destruction and a gloomy long-term outlook. This led to some notable deals in the shale patch, including Chevron’s acquisition of Noble Energy and ConocoPhillips’ takeover of Concho Resources, both completed last year. According to analysts, these two deals marked the beginning of the M&A wave that is now expected to accelerate, with exploration and production companies with manageable debts and strong acreage positions tying up to benefit from each other’s strengths to emerge stronger from the current crisis with a higher appeal to disgruntled shareholders.

Railroad agrees to pay $140k for oil spill near Guernsey - The Burlington Northern Santa Fe Railway Company has agreed to pay a fine of $140,000 in connection with a 2019 oil spill. The Environmental Protection Agency announced Monday that the organization settled with BNSF to pay for alleged Clean Water Act violations associated with an oil spill into the North Platte River near Guernsey. In February 2019, a derailment of three locomotives and three rail cars owned by BNSF caused a spill of 5,900 gallons of diesel fuel and 800 gallons of lubricating oil into the river in Wendover Canyon, northwest of Guernsey. Two of the derailed locomotives were the sources of the diesel and oil. BNSF reported the spill and an EPA coordinator was dispatched to the site. The railway company worked with the EPA and the state of Wyoming to clean up the spill. The Clean Water Act prohibits the discharge of oil or hazardous substances to waters of the United States or its adjoining shorelines in quantities that may be harmful to public health.

Everett manufacturer settles oil spill fines for $222,000— An Everett manufacturer is paying $222,200 to settle fines for two oil spills that polluted a stormwater pond and tainted local wildlife near Narbeck Creek. In July 2018, an Achilles USA employee dropped a moving tote with lubricating oil at the company’s south Everett facility, causing the container to rupture and spill into the building’s stormwater system. From there, the oil was flushed into a retention pond outside, where animals are known to hang out. While cleaning up that spill, responders found that an overflowing collection pit inside the facility was also draining into the retention pond. In all, 340 gallons of oil were dumped into the pond. It took three weeks to clean. Responders caught and cleaned six geese and a snake that were covered in oil. They also saw blue herons that were covered in oil, but couldn’t catch them. The state Department of Ecology initially cited Achilles USA, a plastic film manufacturer, last year for a $327,200 liability, negligence and failing to notify authorities of the incident. The settlement, approved by the Washington Pollution Control Hearings Board, resolves the penalty. The money will go toward environmental restoration managed by public agencies and nonprofits. Achilles also has paid nearly $12,000 to cover the state’s expenses in responding to the spill, and nearly $4,000 for a separate natural resources damage assessment. .

California Is Greenlighting Oil Wells Linked to Groundwater Pollution -- Throughout 2020 and early 2021, California issued more than 300 permits to oil and gas companies for new underground injection wells — an intensive form of oil production and wastewater disposal.  But the actual number of new injection wells is likely higher, owing to the state’s opaque approval process that has drawn scrutiny from auditors and environmentalists. Some of these undercounted wells may be polluting groundwater used for public drinking and agricultural purposes, according to regulatory filings reviewed by Capital & Main. The impact of injection wells on groundwater in California is understudied, regulators say. The California Geologic Energy Management Division (CalGEM), which issues the permits and regulates the industry, is currently the subject of a lawsuit alleging the division issued permits for wells without required environmental reviews. Environmentalists say it’s another contradiction in the state’s energy policy, which seeks to position California as a leader in reducing greenhouse gas emissions while at the same time issuing hundreds of permits for injection wells — an energy-intensive and pollution-heavy form of hydrocarbon production — and prolonging society’s dependence on fossil fuels. At least two assessments, one in Ventura County and another in Kern County, showed petroleum-related gases or fluids migrating into important aquifers. Most of the injection well permits issued by CalGEM were for oil production through cyclic steam, waterflooding or steamflooding, all of which involve pushing pressurized water into a layer of diatomite — a fossilized slice of earth containing hardened oil — and allowing the water to loosen the oil until it can be pumped out. Injection wells can be as deep as 5,000 feet and account for 60% of all produced oil in California, where much of the remaining supply is difficult to access by more conventional means. A related kind of well involves injecting water produced while extracting oil back into an underground aquifer to dispose of it. To do this, an aquifer must be exempted from federal protections by the EPA — a trend that accelerated under former President Trump’s administration. Injected water is also used to increase overall oil production in more than 95% of the state’s injection wells. It’s often mixed with toxic chemicals.

Pipeline leaks more than 1,600 gallons of oil at Inglewood Oil Field -- A pipeline leaked more than 1,600 gallons of oil this week in the Inglewood Oil Field near Kenneth Hahn State Recreation Area when a valve was left open. Human error caused the spill, which occurred at 8:10 a.m. Tuesday, according to a report from the state’s Office of Emergency Services. The report indicated that the spill had been contained and that E&B Natural Resources, the company that operates the pipeline, was handling the cleanup. In a statement, E&B spokesman Ted Cordova said that no injuries were reported and that the release of oil had remained contained due to an additional built-in safety measure to catch accidental spills.  Mario Tresierras, chief of the L.A. County Fire Department’s Health Hazardous Materials Division, said that his team observed the cleanup and that the spill hadn’t warranted an evacuation or notification to residents. “We would have taken action” if there had been a safety risk, he said. But environmental groups Wednesday expressed alarm about residents who may have been exposed to toxins released into the air and renewed their concern about the Inglewood Oil Field, the largest urban oil field in the country. It spans about 1,000 acres around Culver City, Baldwin Hills and neighboring communities. “Any spill that occurs in close proximity to neighborhoods puts people at risk, especially vulnerable populations like kids and elderly and folks with respiratory illnesses,” said Hollin Kretzmann, an attorney for the Center for Biological Diversity.

Pipeline Spills Over 1,600 Gallons of Oil Near Los Angeles Communities **More than 1,600 gallons of oil have spilled in the Inglewood Oil Field — the largest urban oil field in the country, where more than a million people live within five miles of its boundaries, the Sierra Club wrote in a statement on Wednesday.The spill was caused by a human error when a valve was left open, the Los Angeles Times reported. It was also not the field's first spill. Past spills at the Inglewood Oil Field, located in Culver City and Los Angeles County, have occurred in 2019, 2018, 2010, 2006 and 2005, exposing residents in the area to toxins and carcinogens, the Sierra Club added.After a history of community organizing, Tuesday's spill arms activists with further momentum to fight against this major public health and environmental crisis in California's largest county."Yesterday's oil spill is a deadly reminder that the environmental racism that's shaped and harmed Black, Indigenous, and people of color continues to put our health at risk," Martha Dina Argüello, of the STAND-LA Coalition, an environmental justice coalition, and Physicians for Social Responsibility-Los Angeles, said in a Sierra Club statement. Of the people living in the area, 52 percent are Black, which is a much higher percentage than the countywide eight percent, the Sierra Club reported. The oil field is also located alongside homes and schools, putting families at risk for health outcomes from air pollution like lung disease, leukemia, lymphoma, lung cancer and asthma. In Baldwin Hills, asthma related ER visits are 4.4 times higher than the Los Angeles County average."A pattern of oil spills and the daily and 'authorized' toxic emissions both demonstrate that oil extraction is [an] inherently dangerous practice that has no place in our region. We look forward to working with Los Angeles County to take immediate steps to phase out oil and gas production," Argüello added, according to the Sierra Club.

Hilcorp shuts down two offshore platforms in Cook Inlet after natural gas leaks from fuel line -- Hilcorp Alaska shut down two offshore production platforms in Cook Inlet after a helicopter pilot spotted bubbling water on the surface last week. Natural gas was leaking from a line that provides fuel for the platforms’ operations, the Alaska Department of Environmental Conservation reported in a statement on Monday. Hilcorp stopped the leak on Saturday at 1:30 p.m., activating block valves, the agency said. The pilot discovered the leak on Thursday at about 4:30 p.m. Hilcorp reported the leak to the federal National Response Center and the state agency about an hour after the pilot discovered the bubbles, DEC said. Hilcorp notified appropriate federal and state agencies after the leak was discovered and immediately began shutting down the impacted facilities at Platforms A and C, Hilcorp spokesman Luke Miller said in a statement on Monday. “No sheen has been observed,” Miller said. “An assessment of the source of the leak is ongoing. No personnel or wildlife have been impacted.”

Shell Warns Oil-Price Gains Partly Offset by Hit From Texas Freeze – WSJ —Royal Dutch Shell PLC said gains it made from higher oil prices in the first quarter would be partly offset by disruption related to the winter storm in Texas, knocking the energy giant’s recovery from the pandemic.The company said Wednesday that the cold snap had hurt its production, refining and chemicals operations in the state, and would reduce earnings by around $200 million.The unusually cold weather left millions of Texans without power and resulted in outages at refineries and chemical plants, disrupted pipeline flows, and froze oil and natural-gas wells.Despite the disruption, Shell and other big oil companies are looking to mount a recovery this year after reporting some of their worst results on record for 2020. Covid-19 lockdowns sapped demand for oil, sending prices lower, prompting Shell and its peers to reduce costs, shrink workforces and cut dividends.“In actual results the turning point will more likely be the second quarter,” said Jason Kenney, an analyst at Spanish bank Santander, adding that energy companies’ profitability should continue to improve in the second half of the year given cost cutting and the higher oil prices.

The Oil Industry Receives An Unexpected Boost From Biden  -- The election of President Joe Biden has been the cause of much hand-wringing in the United States oil and gas sector. The current U.S. president has made clean energy and climate change a central part of his platform, at what many fear will be the expense of shale, one of the nation’s key economic sectors. This rather alarmist missive came on the heels of the then very new president’s decision to pull the plug on the massive Keystone XL pipeline project on his very first day in office. Babin’s sentiments have been echoed by plenty of oilfield insiders and pro-oil pundits who have not been shy about decrying the new administration’s less than cozy relationship with the shale sector.  That sentiment is understandable, with Biden’s Energy Secretary pick Jennifer Granholm issuing an ultimatum to the oil industry to adapt or die. Despite this rhetoric, it seems that the Biden administration is now throwing the oil industry a bone. The president’s much-touted infrastructure initiative is going to call for asphalt - lots and lots of asphalt - in an unexpected boon for the domestic oil sector. Last week Biden presented his $2.25 trillion infrastructure proposal that will provide a number of economic opportunities for oil, including $115 billion allocated to roads and bridges, and an additional $16 billion to get out of work oilfield laborers back into paid positions plugging abandoned wells across the United States.  The biggest opportunity, however, lies in the sky-high asphalt demand embedded in the infrastructure spending bill. The biggest winners may not be in the domestic market though. Since asphalt is derived from “the heaviest and most-dense material in a barrel of crude” this development could stand to benefit Canada’sstruggling oil sands the most, which will be ecstatic for any new market for their heavy crude bitumen. In fact, while the Biden administration is charging full steam ahead on the clean energy transition, with massive investments into electric vehicles and renewables, it’s clear that they have been listening to the oil sector and have been making a concerted effort not to leave oilfield workers behind. “Since taking office two months ago, Biden’s been more boon than bane for a fossil-fuel industry that was wary of the ascendance of a politician bent on accelerating the energy transition,”Bloomberg reported last week, citing Goldman Sachs’ assertion that Biden has been bullish for oil overall.

Enbridge sticks to North American oil, gas, renewables strategy — Canada's Enbridge expects future spending on growth projects to be more heavily weighted to natural gas and renewables than oil, as it works to meet its carbon reduction goals, CEO Al Monaco said April 7. While the North American midstream operator is betting on fossil fuels, including crude, being an integral part of the global fuel mix for decades to come, it is mindful of the challenge in building new cross-border oil pipelines due to regulatory hurdles and fierce opposition from environmental groups. It also believes it can leverage growth from certain existing infrastructure with a less intensive amount of new spending. During a discussion at the webcast Scotiabank CAPP Energy Symposium, Monaco said Enbridge wants to maintain its current approach and address the energy transition at the same time. Enbridge is holding to a fourth-quarter in-service target for its project to replace Line 3 -- a 1,097-mile crude oil pipeline extending from Edmonton, Alberta to Superior, Wisconsin, Monaco said. "The liquid systems are going to be generating cash for a long time from here," Monaco said. "Maybe, we are not going to convince every investor of that, but that's how we see it." Enbridge's goal in recent years has been to run a pure-play utility pipeline business that focuses on generating predictable long-term fixed fees. The company has sold billions of dollars in non-core assets to overhaul its portfolio around that mission, and it has retooled its corporate structure following the 2017 acquisition of US midstream operator Spectra Energy. Amid the current push by countries around the world to reduce their carbon footprint and use cleaner-burning fuels, Enbridge has also invested more in renewables, including wind and hydrogen. It views natural gas, because of its reliability, as a critical piece in building a bridge to a future with greater use of intermittent renewable energy.

Canadian pipeline companies sees natgas opportunities in shift to green energy  (Reuters) -Canada’s largest pipeline companies TC Energy and Enbridge Inc see opportunities in their extensive natural gas businesses as a transition to cleaner energy evolves, their chief executives said on Wednesday. The two Calgary-based companies are among North America’s largest energy infrastructure firms, and the majority of their business is focused on storing and transporting fossil fuels. TC Energy has the biggest natural gas pipeline system in North America, and CEO François Poirier said the company sees plenty of opportunities to allocate capital to that business in the form of organic bolt-on projects. Storage and transportation assets will be key as the energy transition moves forward and new technologies aimed at reducing greenhouse gas emissions like carbon capture and storage and hydrogen are developed, Poirier said at the online Scotiabank CAPP Energy Symposium. “Transition can’t come fast enough from our perspective but we have to pace it appropriately. I believe natural gas and liquids will continue to play a prominent role in the energy economy for decades to come,” he said. “I believe our existing assets will continue to be used and be useful for quite a long time and generate a tremendous amount of cash flow that we will be able to deploy into the energy transition.” Enbridge CEO Al Monaco, speaking at the same conference, said he saw gas as the “great enabler” for the energy transition because it is a reliable source of power that can backstop renewables. “It’s low-cost, abundant, it’s important in reducing utilization of coal, but it’s equally important in fostering renewables. You’ve got to be able to create baseload capability and it addresses the enormous intermittency challenges,” he said.

Pemex aims to keep financial debt steady, increase crude refining (Reuters) - Mexico's Petroleos Mexicanos expects to maintain financial debt of $105 billion between 2021 and 2025 and increase crude refining, the state oil company said on Tuesday. Pemex, as the company is known, said one of its priorities will be to free up funds and gradually pay back some of its debt without necessarily taking on new obligations. "It is clear that high indebtedness represents a structural problem, attention to which should not be delayed," Pemex said in its latest business plan. "In the medium term, we do not rule out restructuring." Ratings agencies stripped Pemex of its coveted investment grade rating last year because of its high debt and other concerns. Pemex also said it expects crude refining to be 1.1 million barrels per day this year and rise to 1.6 million barrels per day in 2025.

Heritage Petroleum cleans oil spill near Vessigny - AN OPEN VALVE on a Heritage Petroleum Company Ltd crude oil tank led to approximately 318 liters of oil spilling into nearby watercourses, a release to the media said. Heritage said they are now in the process of cleaning the watercourse. The release said it was alerted to the leak by a video circulating on social media, showing oil in a watercourse near its AV106 well site in Vessigny, La Brea. Heritage said it took immediate action to determine the source of the leak which was traced to a crude oil tank at the well site. “Cleaning up the area is proceeding in accordance with established industry standards and protocols. Continuous assessment and monitoring of the site is also ongoing. All regulatory bodies were notified of the incident,” Heritage said. Heritage added that it is using booms – floating physical barriers which contain oil in watercourses during spills – in strategic locations. The release said this was not the first time that such an incident happened. “The previous incident was the result of the deliberate tampering of a valve on the tank. Subsequently, Heritage implemented an engineered solution with a view to curtailing similar incidents.” Heritage said tampering with its equipment could lead to serious injury of people and damage to the environment.

Argentina's Illegal Oil and Gas Waste Dumps Show 'Dark Side' of Vaca Muerta Drilling, Says Criminal Complaint - On December 21, 2020, environmental crimes investigators in the western Argentine province of Neuquén carried out a raid against a company that handles fracking waste in the heart of the Vaca Muerta shale basin, a booming oil and gas field in northern Patagonia. They seized a cache of documents, and opened an investigation into the potential illegal handling of massive volumes of fracking waste.The raid on the Argentine waste company Comarsa by the office of Environmental Crimes and Special Laws, a unit under Neuquén’s chief prosecutor, was prompted by a lengthy criminal complaint filed to the office just a few days earlier by a group of environmental lawyers. Within the complaint, the lawyers document what they describe as a decade-long illegal accumulation of toxic fracking waste at multiple sites in the city of Neuquén, the largest city in Patagonia with a population over 300,000. The sites are located within the city and also on the outskirts of Añelo, a small desert town of 8,000 about an hour and a half drive northwest of Neuquén and the unofficial drilling capital of the Vaca Muerta.But the criminal complaint didn’t just target Comarsa, one of the leading handlers of fracking waste in the Vaca Muerta. It also pointed fingers at the municipalities of Neuquén and Añelo, the Secretariat of Territorial Development and Environment (environmental regulators for the province of Neuquén), and the region’s top oil producers, including ExxonMobil and Chevron. “The Vaca Muerta oil dumps are the result of a series of maneuvers that are part of a collusion between companies and state authorities,” Rafael Colombo, a lawyer for the Argentine Association of Environmental Lawyers, or AAAA,said in a press release when he filed the criminal complaint in December. According to AAAA, Comarsa earns huge sums “for the treatment of waste that they never treat,” Colombo said, “then they get the State to give them public lands to end up disposing of hazardous waste illegally.”The illegal fracking waste sites are the “dark side” of Vaca Muerta, he said.Fracking for oil and gas produces enormous quantities of liquid and solid waste. After a well is drilled, a slurry of water, drilling fluids, and other chemicals is injected into the well at extreme pressures to fracture the rock. Much of the resulting toxic cocktail, which can contain heavy metals and naturally occurring radioactive contamination, is returned to the surface for disposal.Drill cuttings, the pulverized rock from the drilling process, can also be radioactive.Disposing of this waste presents problems for drillers. Sometimes they reinject it deep underground, a process that can contribute to increased seismic activity. Drillers may also store waste in tanks or lined pits, or “recycle” and repurpose it for other industrial uses, each of which carries its own set of environmental and safety hazards.

Colombia oil workers join anti-fracking campaign (Reuters) - Colombia’s largest oil union has joined anti-fracking activists to oppose the development of non-conventional energy deposits and demand a quicker transition to renewable energy, campaigners said on Tuesday. The Petroleum Industry Workers Union (USO) and the Colombia Free from Fracking Alliance said in a joint statement they are joining forces to protect the Magdalena Medio region and the country as a whole from non-conventional exploration. Colombians are divided over the development of non-conventional deposits, including fracking for shale gas and coal bed methane. Commercial development of the deposits is currently not permitted, but the country’s highest administrative court is holding hearings ahead of a final ruling and has allowed pilot projects to go ahead in the meantime. “(USO) is joining forces with different social and political organizations in the country to oppose this type of exploitation and advocates an accelerated just energy transition,” union president Edwin Palma said in a post on Twitter. Some 120 other organizations form part of the anti-fracking alliance. USO has around 30,000 members.

Dutch cargo ship adrift off Norway after dramatic rescue (Reuters) - The crew of a Dutch cargo ship was evacuated in stormy weather off the coast of Norway late on Monday, leaving the abandoned vessel adrift and in danger of sinking and causing an oil spill, local authorities said on Tuesday. Footage released by the Norwegian Rescue Coordination Centre showed some of the 12 crew members jumping into the ocean from the badly listing Eemslift Hendrika before being rescued by helicopter. Others were hoisted directly from the deck. All were brought to safety, but the vessel - currently some 130 km (80 miles) off the coast in the North Sea - is at risk of sinking, Norwegian officials said. “The ship lost power on the main engine during the night and is drifting towards land,” Hans Petter Mortensholm of the Norwegian Coastal Administration, told public broadcaster NRK. “There is a risk it may capsize and sink,” Mortensholm said, adding that this could cause a spill. The Hendrika has around 350 tonnes of heavy oil and 50 tonnes of diesel in its tanks, the Coastal Administration said in a statement. Smit Salvage, a subsidiary of the Dutch marine services company Boskalis, told Reuters it had been contracted to try saving the ship and was mobilising a team to send to Norway later on Tuesday. Safety permitting, Smit would seek to get its own crew on board the Hendrika and link the vessel to a so-called anchor handling tug, a powerful ship built to move rigs for the oil industry. “Getting her onto a tow line and to a calmer location, that is the goal,” Smit Salvage spokesman Martijn Schuttevaer said. . 

Norway fears cargo ship will run aground, spill oil within hours (Reuters) - A Dutch cargo ship that was abandoned at sea during a storm this week is on course to run aground in Norway early on Thursday and could cause an oil spill unless a last-ditch effort to save the vessel prevails, local officials said on Wednesday. The Eemslift Hendrika, badly listing after parts of its cargo shifted in the rough weather, is adrift just 18 kilometres (11 miles) from shore and could make landfall at around 0230 GMT, the Norwegian Coastal Administration (NCA) said. While the NCA earlier said the Hendrika was drifting parallel to the coast, and that rescue efforts could wait for another day while two large tugs remain on standby, it will now accelerate the effort. “We’ve succeeded in lowering a salvage crew onto the Eemslift Hendrika. They are working to establish tow lines,” the NCA said in a statement. The Hendrika has around 350 tonnes of heavy oil and 50 tonnes of diesel in its tanks, it added. Footage released by the Norwegian Rescue Coordination Centre on Tuesday showed some of the original crew members jumping into the sea before being rescued by helicopter. Others were hoisted directly from the deck.

An Italian oil tanker suffered a technical failure in the Suez Canal. -- According to local media reports in Egypt, on April 6 local time, the Italian oil tanker Rumford stopped at 133 kilometers of the Suez Canal due to “technical failure” when sailing from Hungary to the Suez Canal. Sources indicate that the ship’s failure in the middle of the Suez Canal “did not affect its navigation”, and tugboats will transport it to Great Bitter Lake for troubleshooting.

Russian region hit by oil spill at Bashneft field - A major oil spill from an infield pipeline has reportedly left a spring in central Russia heavily polluted. Bashneft, a regional subsidiary of oil giant Rosneft, has acknowledged the spill from a pipeline running near the village of Pavlovka in the Bizhbulyaksky district in the Bashkiria region.The acknowledgement came after local residents and the region's Emergency Situations Ministry posted photographs of the accident online on 1 April, showing a local spring running across a field that has been heavily polluted by a dark substance.According to the Emergency Situations Ministry, about 300 cubic metres of “an oil and water mixture” has been spilled from a pipeline, running from the nearby Skhapovskoye field that is being developed by Bashneft. About 350 square metres of ground have been polluted with oil, with spill response teams continuing to remove polluted soil from the site of the incident and transport it to a processing site in the Ishimbaysky district.Bashneft said in a short statement that “an insignificant volume" of liquid containing oil was spilled and has been surrounded by booms."There is no threat of oil-containing liquid entering water reservoirs," it said. At least two major oil spills were reported in March at oilfields in West Siberia operated by Rosneft subsidiaries Yuganskneftegaz and Nyaganneftegaz. An oil spill accident on the Malo-Balykskoye field, developed by Yuganskneftegaz, was initially spotted by passengers of a local train who then reported it to authorities.As representatives of the regional Emergency Situations Ministry arrived to the site, they reportedly discovered that the operator had already taken most of polluted soil from the accident site after failing to promptly report the incident to authorities.According to an official estimate, up to 1500 cubic metres (about 9434 barrels) of the oil and water mixture was leaked from a ruptured field pipeline to the ground and nearby lakes.The true scope o f oil pollution at the Malo-Balykskoye field will be gauged once all snow melts in the area, according to the ministry.Another incident was registered on the Talinsky block that is licenced to Nyaganneftegaz, with an estimated 50 cubic metres (about 314 barrels) of oil escaping from a faulty pipeline.An earlier incident on the Ob river near the West Siberian city of Nizhnevartovsk went viral in Russian social networks in early March as witnesses filmed a fire on the river surface. According to authorities, light hydrocarbons were leaked from a ruptured pipeline on the riverbed and then ignited.

Russia slashes 2021-2022 oil production forecasts -Russia is slashing its estimates for domestic crude oil, gas, and coal production for 2021 and 2022, according to the latest amendments in the government’s program for energy development.As per the latest forecasts from the Russian government, oil production this year is set to stand at 517 million tons, down from a previous estimate of 560 million tons. The projection for Russia’s oil output in 2022 was also reduced, to 548 million tons, down from earlier estimates of production of 558 million tons, TASS news agency reports.The estimates for the oil production for 2023 and 2024 remain unchanged, according to the document approved by the government.Natural gas production is also estimated lower than previous projections, as is coal output. Yet, the Russian government kept its projection for liquefied natural gas (LNG) production the same as in earlier forecasts, expecting LNG production at 30.1 million tons in 2021. Last month, Russia’s government approved a long-term development program for LNG, expecting production capacity to rise threefold from current levels to 140 million tons per year by 2035.Russia is also targeting increased LNG exports, considering the expectations of sustained growth in LNG demand and trade globally, Russia’s Prime Minister Mikhail Mishustin said in March. Still, the reduced forecasts for oil production for this year and next likely reflect, in part, the ongoing OPEC+ agreement.

Shell confirms oil spill in Bayelsa community - The Shell Petroleum Development Company (SPDC) has confirmed oil spill from its facility at Agbura-Otuokpoti area of Yenagoa, the state capital. The comapny’s Media Relations Manager, Bamidele Odugbesan, confirmed the incident in an interview with the News Agency of Nigeria (NAN) in Yenagoa on Friday. Odugbesan said the company got a report of the spill on March 31. “At about 8.30am on March 31, a community surveillance vendor reported a leak on the company’s Joint Venture pipeline at Nun River in Bayelsa. “Following the development, the facility was shut down and full isolation established at 09.45am. “The SPDC Oil Spill Response Team was mobilised to the spill site and was able to contain the spill to prevent further spread. “The Joint Investigation Visit team led by government regulator will determine the cause and impact of the spill,” Odugbesan said. He, however, said that there was an anonymous note found at the spill site, suggesting sabotage. Residents, who said the oil workers had yet to come to the site as at Friday, have resorted to scooping oil from water surface into drums. Daniel Ebitimi, who claimed that crude oil has curative effect on burns and skin diseases, said he collected some kegs, which he hoped to sell. The predominantly fishing and farming settlements regretted that the leakage discharged large volumes of crude oil into the River, resulting in pollution of the waters.

NGO tackles Chevron over oil spill in Gbaramatu -- The Centre for Peace and Environmental Justice on Monday said the failure of Chevron Nigeria Limited to accept responsibility for the Gbaramatu oil spill was to undermine the wellbeing and environment of people living in the affected communities. CEPEJ said the oil spill had continued to ravage the affected areas for almost two months, as it faulted the denial by Chevron with respect to the spill. The Chief Executive Officer, CEPEJ, Chief Sheriff Mulade, said in a statement that Chevron’s claim that its facilities were not responsible for the oil spill because the pressure in its control room did not indicate that there was a leakage or a drop somewhere was not tenable. He argued that Chevron should re-examine its claim as there could be system failure that had made it difficult for it to detect the leakage from its facilities in the affected communities. Although he admitted that Chevron shared facilities with the Nigeria Petroleum Development Company field Jones Creek flow-station in the affected location, Chevron’s 16” crude line runs from Makaraba through Otunana to Abiteye and the leakage was between Otunana and Abiteye. Mulade stated that from the detailed investigations carried out by CEPEJ on the oil spill, the leakage was at the centre of Nana River, located between Kokodiag-bane and Benikrukru. “The two communities are adjacent and opposite each other, while in-between them is the Nana River that is a ship line route where all vessels pass through to Sapele, Koko and Lagos ports,” he said. He insisted that Chevron’s facilities in the affected areas might not be exonerated from the spill. Mulade said, “If you do an over flight like I hear Chevron did, you may not be able to see the point of leakage because the spill is deep under the river and you may not see it when you move around but only when the tide slows down. “And because the spill is gas pressured, you stand a chance of being suffocated in the area if you stay there for more than five to 10 minutes. That is the extent to which the spill is dangerous.” CEPEJ said it had earlier called on Chevron to immediately address the spill, but noted that the response from the company had not been impressive. Reacting to the position of the NGO, Chevron insisted that the oil spill was not from its assets. A statement sent to our correspondent on Monday by the oil firm read in part, “CNL (Chevron Nigeria Limited) has investigated and continues to survey its assets in the Abiteye and Utonana fields including the 16” Makaraba-Utonana-Abiteye right-of-way. “And CNL confirms that there has not been any indication that the oil sheen on water is from its assets in Abiteye, Makaraba and Utonana fields or from any other CNL facilities as alleged.”

Coast Guard collects 2K-liter oil residue from sunken ship – The Philippine Coast Guard (PCG) and local community were able to collect at least 2,000 liters of oil residue from an old cargo ship that sank in the coastal Barangay Lower Jasaan, Jasaan town, Misamis Oriental on Sunday. Sabas Tagarda Jr., Lower Jasaan village chairman, said the oil residue was caused by the sinking of MV Racal IV, a cargo boat that had been docked at a local shipyard in Lower Jasaan five years ago. Using sawdust and mosquito net, PCG was able to collect the oil that was already mixed with saltwater. He said to capture the oil, sawdust is spread out to the sea. Oil is absorbed by the sawdust which is then gathered using the mosquito net. “It is simple yet effective. So far, we were able to collect almost half of the oil in my area of responsibility,” Tagarda said, adding that it is his hope that other village leaders will follow this method. However, residents in the said barangay have also expressed concern that oil spill caused by the sunken old cargo ship could affect the livelihood of the village’s fisherfolk. Petty Officer 2nd Class Ronald Moncayo, acting chief of the PCG’s Marine Environment Protection Force based in Misamis Oriental, said the sinking occurred early Saturday morning, Prior to that, it was already reported there was a hull breach that is causing the seawater to seep into the vessel. He added that a salvage company has asked permission to “pump out” any remaining fluids such as oil inside the boat before scrapping it, adding that the ship was no longer operational and was sold to a new owner when it sank. “I told them (salvage company) to put spill booms around the vessel as requirement before we could allow them to conduct a ‘pump out,’ but it sank before the salvaging company could comply with the requirement,” Moncayo said.

Fire, oil spill at Chinas Penglai platform- Update -- An offshore crude production platform in China's Bohai bay has caught fire and spilt oil, forcing output to be halted, market participants said.The accident happened on 5 April at the Penglai 19-3 field, which is operated by state-owned CNOOC in a 51:49 venture with US independent ConocoPhillips. The third wellhead production platform at Penglai's phase 3 caught fire and has been largely destroyed, leaving some workers missing, according to industry participants in China.The incident was confirmed by an employee at one of the companies involved, although the details are unclear. ConocoPhillips referred questions to CNOOC. CNOOC did not immediately respond to requests for comment.The platform is still on fire and at risk of collapse if the blaze is not extinguished soon, a market participant said.Penglai 19-3 was one of China's largest oil fields when it was discovered more than 20 years ago. ConocoPhillips also has a 49pc non-operating share in Penglai's 19-9 and 25-6 blocks, which together with the 19-3 field produced a combined 30,000 b/d in 2020. The phase 3 project comprises mainly three new wellhead platforms and a central processing facility.The Penglai fields produce heavy-sweet crude that is sold to CNOOC's own refineries and to independent refiners in Shandong province.An oil spill at the Penglai fields in 2011 resulted in CNOOC and ConocoPhillips paying several hundred million dollars in compensation.

CNOOC sees minimal output hit from China oil field fire -- China's state-controlled CNOOC expects a fire at one of its offshore platforms earlier this week to reduce crude production by around 600,000 bl this year.A production platform at the company's Penglai fields in northeast China's Bohai bay was hit by a fire on 5 April after shallow gas overflowed during drilling operations, CNOOC said today in its first comment on the incident.Argus reported the fire yesterday.The fire was extinguished on 6 April and there has been no oil spill or environmental pollution so far, CNOOC said. The company evacuated 99 of the 102 people on the platform at the time of the incident, and search operations are underway for the three missing workers.The incident is likely to affect up to around 600,000 bl of production this year, which CNOOC estimated at 0.1pc of its total output. CNOOC has set aproduction target of 1.49mn-1.52mn b/d of oil equivalent (boe/d) this year. It produced 1.44mn boe/d in 2020, including 1.12mn b/d of liquids.The fire hit the third wellhead platform at the Penglai 19-3 field's phase 3 operations, market participants s aid. CNOOC operates the field in a 51:49 joint venture with US independent ConocoPhillips.

Qatar Petroleum and Shell Partner in Namibia - Qatar Petroleum announced on Tuesday that it has entered into an agreement with Shell to become a partner in two exploration blocks offshore the Republic of Namibia. Under the terms of the deal, which is said to be subject to customary approvals, Qatar Petroleum will hold a 45 percent participating interest in the PEL 39 exploration license in Block 2913A and Block 2914B. Shell will hold a 45 percent operated interest in the asset and the National Petroleum Corporation of Namibia (NAMCOR) will hold the remaining 10 percent stake. The PEL 39 blocks are located in ultra-deep-water depths of about 8,200 feet, covering an area of approximately 4,750 square miles, Qatar Petroleum highlighted. This is the company’s second exploration license in Namibia. In August 2019, the business entered into agreements for participating in blocks 2913B and 2912 offshore Namibia. “With this second exploration and production sharing agreement in Namibia, we are pleased to expand our exploration footprint in the country, and to further strengthen our presence in the southern Africa region,” Saad Sherida Al-Kaabi, the minister of state for energy affairs, and the president and chief executive officer of Qatar Petroleum, said in a company statement. According to Shell’s website, Shell Namibia Upstream BV currently has a 45 percent controlling interest in PEL 39, with Kosmos Energy holding a 45 percent stake and NAMCOR holding the remaining 10 percent interest. Shell completed three seismic surveys of PEL 39 between 2014 and 2019, the company notes on its website, adding that the purpose of the surveys was to identify geological structures below the seabed which might contain oil or gas.

Eni Makes New Light Oil Find - Eni has announced that it has made a new light oil discovery in Block 15/06 in Angola’s deep offshore. The Cuica-1 NFW well, which was drilled on the Cuica exploration prospect located inside the Cabaça Development Area, resulted in an oil find estimated to be between 200 million and 250 million barrels of oil in place, Eni revealed. Cuica-1 NFW was drilled as a deviated well by the Libongos drillship in a water depth of 1,640 feet, and reached a total vertical depth of 13,451 feet, encountering a 262-foot total column of reservoir of light oil in sandstones of Miocene age with good petrophysical properties, Eni noted. The company added that the discovery well is going to be sidetracked “updip” to be placed in an “optimal position” as a producer well. Eni said the result of “intensive” data collection indicates an expected production capacity of around 10,000 barrels of oil per day. The well-head location, intentionally placed close to East Hub’s subsea network, will allow a fast-track tie-in of the well and relevant production, Eni stated. The company expects that production will start within six months after the discovery. Cuica is the second significant oil discovery inside the existing Cabaça Development Area, Eni highlighted. Block 15/06 is operated by Eni with a 36.8421 percent interest, Sonangol P&P, which also has a 36.8421 percent stake, and SSI Fifteen Limited, which holds the remaining 26.3158 interest. Last month, Eni, through Var Energi, which is jointly owned by Eni (69.85 percent) and by HitecVision (30.15 percent) announced a “significant” oil discovery in production license 090/090I in the northern North Sea. During the same month, and again through Var Energi, Eni announced an oil discovery in production license PL532 in the Barents Sea. Back in December, Eni announced a new oil discovery in the Meleiha Concession in the Western Desert of Egypt.

Oman oil exports stage strong rebound in March - Oman's oil exports rebounded from a 19-month low in February to average 776,000 b/d in March, according to energy ministry data. A reduction in crude intake at the country's refineries left more available for export last month, according to a ministry source. The near 10pc jump from February's 709,000 b/d marks the biggest month-on-month increase in shipments of Oman Export Blend since June 2020. Oman's export grade is a blend of crude and condensate. Data for Oman's refined product output and consumption last month is not yet available. But an emergency shutdown of a residual fluid catalytic cracker at Oman's 198,000 b/d Sohar refinery in the middle of the month boosted the amount of crude that was available for export, according to the ministry source. The shutdown lasted for around 20 days and ended yesterday. A nationwide night-time curfew imposed at the start of the month will also have weighed on demand for transport fuels, which had recovered somewhat in February, when Covid-19 measures were more relaxed. According to the latest data from Oman's National Centre for Statistics and Information, domestic gasoil demand rose by 6pc on the month to 36,000 b/d in February, while gasoline demand edged up by 1pc to 60,500 b/d over the same period. Jet fuel demand, however, fell by 12pc to 3,600 b/d in February, in large part due to a ban on flights from 10 countries that came into effect in February. Official data for March will likely be released in the last week of this month. Increased condensate production since the middle of last year has helped Oman keep its overall liquids production at relatively elevated levels, despite its participation in the Opec+ output restraint deal. Condensate production has been excluded from the agreement since December 2019. Oman's condensate output edged up to 222,000 b/d in March, from 220,000 b/d in February, just shy of January's record high of 228,000 b/d. The sultanate's crude production was also marginally up on the month at 730,000 b/d, from 729,000 b/d in February, but still below its current Opec+ crude output ceiling of 732,000 b/d. This puts Oman's total liquids output at 952,000 b/d in March, up marginally from 949,000 b/d in February.

Indian refiners limit cuts to May Saudi crude imports - State-controlled Indian refiners have asked to buy around 9.5mn bl (305,000 b/d) of term crude from Saudi Arabia for May loading, lower than typical levels in line with a government directive to reduce the country's dependence on Mideast Gulf crude, a senior official involved in the import talks said. The planned cuts to India's May nominations come as souring relations between Delhi and Riyadh have prompted a renewed import diversification drive. But the extent of the proposed May cuts is relatively mild — equivalent to only around a 5pc decline on pre-Covid import levels, according to Argus' analysis of state-controlled importers' internal purchase data — and in line with a potential fall in fuel demand as India fights a resurgent Covid-19 outbreak. State-run IOC, Bharat Petroleum and Hindustan Petroleum imported a combined 17mn t/yr (10mn bl/month or 340,000 b/d) of crude from Saudi Arabia in the April 2019-March 2020 financial year, before the pandemic disrupted trade flows. Saudi arrivals fell to an average of around 8.8mn bl/month, or 290,000 b/d, in the 10 months between April 2020 and January 2021, in line with a drop in India's total imports, the company data show. State-controlled Saudi Aramco has typically cut its allocations to Asia-Pacific buyers over the past year to comply with Opec+ production curbs, which may have sent actual deliveries below contractual volumes. Smaller refiners MRPL and HMEL buy some Saudi crude under term deals, and private-sector Reliance Industries (RIL) and Nayara take a significant amount of Saudi crude. Privately operated companies are not covered by the government directives. India's crude imports from Saudi Arabia fell to 753,000 b/d in 2020 from 855,000 b/d a year earlier, as the Covid-19 pandemic hit demand. Imports were 640,000 b/d in the first quarter of this year, according to Vortexa. The relationship between India and Saudi Arabia has come under pressure since Opec+ cuts helped send Ice Brent crude futures prices to around $70/bl last month. Delhi has complained about Opec+ policies, leading Saudi Arabia to suggest that India withdraws some of the lower-priced crude stocks it built up when markets crashed last year. High fuel taxes in India have helped send pump prices to record levels, making oil prices a sensitive political issue. Oil minister Dharmendra Pradhan, under pressure to reduce prices, has resent instructions to state-run refiners to diversify their crude supplies, officials at the refiners said. 

Libya's largest oilfield could see exports interrupted - The largest oilfield in Libya, the 300,000-bpd Sharara field, could see crude oil exports from it disrupted if members of the Petroleum Facilities Guard (PFG) follow through with their threat to shut down exports if their demands for pay are not met. Earlier this week, the PFG issued an ultimatum demanding they be paid field allowance compensation, Argus reported on Thursday.The Sharara oilfield was pumping crude oil near its capacity, at a rate of 280,000 bpd as of the middle of March, according to internal memos of the Akakus Oil joint venture operating the oilfield seen by Argus. The threats of guards disrupting exports over unpaid wages or other allowances are nothing new in Libya’s oil industry, which has been suffering for ten years now from fighting since Muammar Gaddafi was toppled in 2011.In February this year, a tanker had to leave Libya’s Hariga export terminal without oil after members of the Petroleum Facilities Guard stopped the vessel from loading crude amid a strike over delayed salary payments.In March, a new cabinet was sworn in, the first unity government of the war-torn country since 2014, reviving hopes that Libya could see more stability in oil production going forward. Libya—exempted from the OPEC+ cuts—surprised many oil market observers, and probably the OPEC+ group itself, after managing in just a few months to restore its oil production back to 1.25 million bpd from less than 100,000 in September 2020, when an eight-month-long blockade on its oil ports ended.Libya may be able to maintain its current level of oil production of around 1.2 million bpd until the end of this year as the oil sector is finally receiving enough funding for field maintenance and development, Libya’s Oil Minister Mohamed Oun told Bloomberg in an interview last month. In March, Oun was sworn in as the first oil minister of the country since 2014.

OPEC is betting big on robust oil demand recovery -Last week’s surprise decision from OPEC+ to ease the production cuts by a cumulative 2 million barrels per day (bpd) by July relies on expectations of robust oil demand recovery in the second quarter. Yet, recent demand concerns suggest the alliance’s supply management policies could once again be more in the realm of guestimates.The easing of the collective cuts by over 1 million bpd over the next three months, plus Saudi Arabia reversing gradually its extra 1 million bpd cut signal that OPEC+ expects demand to rebound strongly and justify supply increases, Reuters columnist Clyde Russell writes.       However, the unpredictability of the COVID resurgence in major economies lagging behind in vaccination programs could spoil the OPEC+ forecasts and supply management policies once again. Last week, OPEC+ decided to gradually increase collective oil production by 350,000 bpd in each of May and June and by more than 400,000 bpd in July. Additionally, Saudi Arabia will also gradually ease its extra unilateral cut of 1 million bpd over the course of the next few months, beginning with monthly production increases of 250,000 bpd in each of May and June.Although the initial knee-jerk reaction to the outcome of the OPEC+ meeting on Thursday was heavy selling in oil because additional supply is coming, prices finished strong that day with more than 3-percent gains as the market realized that OPEC+ expects strengthening of oil demand with its decision to put more crude on the market. Asia’s demand for crude looks strong as gasoline demand looks robust, but demand for diesel and jet fuel is still soft, according to Reuters’ Russell. India, the world’s third-largest oil importer, added another scare to oil demand forecasts this week, with a record-high number of new COVID cases and a lockdown in the biggest city, MumbaiMost analysts continue to believe that the market will be able to absorb the new barrels from OPEC+ with strengthening demand going into the summer months. Goldman Sachs, for example, is still bullish on oil and anticipates strong demand that would require OPEC+ putting another 2 million bpd on the market in the third quarter, after the around 2 million bpd that the alliance and Saudi Arabia decided to return between May and July.

Oil prices hang in the balance ahead of Iran nuclear talks, but experts don’t expect a breakthrough -- The U.S. and Iran are ramping up efforts to resolve a nuclear standoff that has global oil markets on edge and experts skeptical of success. "It's crunch time for these negotiations," Helima Croft, global head of commodities strategy at RBC Capital Markets told CNBC's Hadley Gamble on Tuesday, as representatives gathered in Vienna, Austria for "indirect talks" aimed at bringing both countries back into compliance with the 2015 nuclear deal. "We're going into election season in Iran in a couple of weeks, and if we don't get a significant breakthrough in these negotiations, everything is likely to freeze," she said. While the talks are the most significant step forward yet in efforts to revive the deal, neither side expects a major breakthrough. Iranian officials want the U.S. to end Trump-era economic sanctions before returning to compliance — a concession Washington seems unwilling to accept. "I don't think we can expect very much," Albert Wolf, an associate fellow at the Johns Hopkins School of Advanced International Studies, told CNBC on Tuesday. Skepticism over the talks was compounded by reports that European officials would act as intermediaries between the U.S. and Iran, rather than both sides meeting face-to-face to discuss the issues. "There hadn't even been any formal or informal talks between the U.S. and Iranian sides, so it looks as if at present time, these talks are going to be a bust," Wolf said. U.S. officials themselves appear to be equally sober about the talks. "We don't underestimate the scale of the challenges ahead. These are early days," State Department spokesman Ned Price said during a press call Monday. "We don't anticipate an early or immediate breakthrough, as these discussions we fully expect will be difficult. But we do believe that these discussions with our partners and, in turn, our partners with Iran is a healthy step forward." Price added: "We don't anticipate at present that there will be direct talks with Iran, though, of course, we remain open to them. And so we'll have to see how things go starting early this week." One of OPEC's largest oil producers, Iran's exports were slashed in the years following the U.S. withdrawal from the Joint Comprehensive Plan of Action. A return to the deal and the lifting of U.S. sanctions on Iranian crude could significantly impact oil market dynamics. Croft said "significant movement" in the talks would raise the prospect of large quantities of Iran oil returning to the global market. "If they get a breakthrough in the next couple of weeks, I think we could be looking at significant quantities hitting the market in the second half of the year," she said.

EIA Raises Oil Price Forecasts Again --The U.S. Energy Information Administration (EIA) has again raised its Brent and West Texas Intermediate (WTI) oil price forecasts for both 2021 and 2022. As its April short term energy outlook (STEO) shows, the organization now sees Brent spot prices averaging $62.28 per barrel this year and $60.49 per barrel in 2022. WTI spot prices are now expected to average $58.89 per barrel in 2021 and $56.74 per barrel in 2022. The EIA’s March STEO saw Brent spot prices averaging $60.67 per barrel in 2021 and $58.51 per barrel next year. WTI spot prices were expected to average $57.24 per barrel in 2021 and $54.75 per barrel in 2022, back in March. In February, the EIA projected that Brent spot prices would average $53.20 per barrel in 2021 and $55.19 per barrel in 2022. WTI spot prices were expected to average $50.21 per barrel this year and $51.56 per barrel next year, in February. Back in January, the EIA saw Brent spot prices averaging $52.70 per barrel in 2021 and $53.44 per barrel in 2022. WTI spot prices were expected to average $49.70 per barrel in 2021 and $49.81 per barrel in 2022, in January. In its April STEO, the EIA forecasted that global consumption of petroleum and liquid fuels will average 97.7 million barrels per day for all of 2021, which it highlighted was up by 5.5 million barrels per day from 2020. The EIA now expects global oil inventories to fall by 1.8 million barrels per day in the first half of 2021 and said forecast increases in global oil supply will contribute to a mostly balanced market during the second half of 2021. The organization warned, however, that this depends heavily on future production decisions by OPEC+, the responsiveness of U.S. tight oil production to oil prices, and the pace of oil demand growth, among other factors. The EIA noted that its April STEO remains subject to heightened levels of uncertainty because responses to Covid-19 continue to evolve.

Oil falls more than 4% as coming OPEC+ production ramp weighs - Oil fell more than 4% on Monday as rising supply from OPEC+ and higher Iranian output countered signs of a strong economic rebound in the United States. The Organization of the Petroleum Exporting Countries and allies, known as OPEC+, agreed on Thursday to monthly production hikes from May to July. OPEC member Iran, exempt from making voluntary cuts, is also boosting supply. "The timing was not good," said Bob Yawger, director of energy futures at Mizuho Securities. "It seemed like OPEC+ was going to roll the deal, but they didn't and now it looks like they're going to have to pay at least in the short term." Brent crude for June fell $3.08, or 4.8%, to $61.78 a barrel. U.S. West Texas Intermediate crude for May settled $2.80, or 4.56%, lower at $58.65 per barrel. In another development that could eventually boost supply, investors are focused on indirect talks between Iran and the United States as part of negotiations to revive the 2015 nuclear deal. "There is an assumption that we're going to see this flood of Irianian oil in the market," said Phil Flynn, senior analyst at Price Futures Group in Chicago. "I think this is overstated a little bit." Eurasia analyst Henry Rome said he expected U.S. sanctions, including restrictions on Iranian oil sales, to be lifted only after these talks are completed and Iran returns to compliance. Iran has already boosted exports to China despite the sanctions. Oil has recovered from historic lows last year with the support of record OPEC+ cuts, most of which will remain after July. Demand is expected to recover further in the second half. While a slow vaccine rollout and return to lockdown in parts of Europe have weighed, figures on Friday showed the U.S. economy created the most jobs in seven months in March. Still, tightening lockdowns in France and a spike of cases in India have darkened the outlook for a global economic rebound to boost oil demand.

U.S. oil prices drop nearly 5% on expectations for a rise in supplies -  Oil futures settled sharply lower on Monday, with U.S. prices down almost 5%. The decline follows a decision by the Organization of the Petroleum Exporting Countries and their allies last week to incrementally increase production from May through July. There's also a "reduced demand outlook with COVID cases rising dramatically in India and several other countries," said Tariq Zahir, managing member at Tyche Capital Advisors. Meanwhile, upcoming talks, with the U.S. possibly easing sanctions on Iran and potentially getting back into the nuclear deal, may lead to higher global supplies of oil, said Zahir. West Texas Intermediate crude for May delivery fell $2.80, or 4.6%, to settle at $58.65 a barrel on the New York Mercantile Exchange. That was the lowest front-month contract finish since March 25, FactSet data show.

Oil climbs on weaker dollar, outweighing OPEC+ supply worries - Oil prices rose early on Tuesday as a drop in the U.S. dollar made crude a more attractive buy, paring losses of more than 4% incurred overnight on the prospect of producers returning more than 2 million barrels per day of supply to the market by July. Brent crude futures jumped 83 cents, or 1.3%, to $62.98 a barrel at 0012 GMT, after falling 4.2% on Monday. U.S. West Texas Intermediate (WTI) crude futures rose 80 cents, or 1.4%, to $59.45 barrel, after sliding 4.6% on Monday. "The weaker U.S. dollar is a contributor, and increasing (U.S.) growth confidence helps," said Michael McCarthy, chief market strategist at CMC Markets and Stockbroking. The dollar fell 0.4% against a basket of currencies <=USD> on Monday and dipped a bit further on Tuesday. Oil prices typically rise against a falling dollar, as a weaker greenback makes dollar-priced oil cheaper for those holding other currencies. Adding to positive sentiment, England is set to ease coronavirus pandemic restrictions on April 12, with the opening of businesses including all shops, gyms, hair salons and outdoor hospitality areas. That helped offset worries about the agreement last week by the Organization of the Petroleum Exporting Countries (OPEC) and allies, known as OPEC+, to bring back 350,000 barrels per day (bpd) of supply in May, another 350,000 bpd in June and a further 400,000 bpd or so in July. Saudi Arabia is also set to phase out its extra voluntary cut of 1 million bpd over those three months. At the same time OPEC member Iran, exempt from making voluntary cuts, is boosting supply. The push by OPEC+ to add supply came despite concerns about a rise in COVID-19 cases. "Rising virus cases in countries such as India and the European Union are keeping traders cautious, with any renewed restrictions likely to weigh on demand," ANZ Research said in a note.

Oil gains 1% on strong U.S., China economic data - (Reuters) -Strong economic data from China and the United States helped lift oil prices by 1% on Tuesday, recouping some of the previous session’s steep losses. Brent rose 59 cents, or 1%, to settle at $62.74 a barrel. U.S. West Texas Intermediate (WTI) crude rose 68 cents, or 1.2%, to settle at $59.33 a barrel. Prices were buoyed as data showed U.S. services activity touched a record high in March. China’s service sector also gathered steam with the sharpest increase in sales in three months. England was set to ease more coronavirus restrictions on April 12, allowing businesses including all shops, gyms, hair salons and outdoor hospitality venues to reopen. On Monday, both oil benchmarks fell by about $3 because of increasing OPEC+ oil supply and rising COVID-19 infections in India and parts of Europe. Last week, the Organization of the Petroleum Exporting Countries (OPEC) and allies, known as OPEC+, agreed to return 350,000 barrels per day (bpd) of supply in May, another 350,000 bpd in June and a further 400,000 bpd or so in July. “Although OPEC+ went against what most market participants and its own research team thought, raising its oil output significantly over the next three months, the market is now signalling that it is OK with it and is ready to benefit from the lack of uncertainty that a month-to-month update would have brought,” . Coronavirus-related deaths worldwide crossed 3 million on Tuesday, according to a Reuters tally, as the global resurgence of infections challenges vaccination efforts around the globe. New restrictions in Europe also weighed on prices. “This will likely raise concerns over demand, given that, at the moment, a large part of the constructive outlook for the oil market is based on the assumption that we see a strong demand recovery over the second half of this year,” . In the United States, oil production is expected to fall by 270,000 bpd in 2021 to 11.04 million bpd, the U.S. Energy Information Administration (EIA) said, a steeper decline than its previous monthly forecast for a drop of 160,000 bpd. U.S. crude stockpiles were down by 2.6 million barrels in the week ended April 2, according to three market sources, citing American Petroleum Institute figures. Forecasters had predicted a drop of just 1.4 million barrels. Official government data is due on Wednesday. U.S. and Iranian officials were due to begin indirect talks in Vienna on Tuesday to revive the 2015 nuclear deal between Tehran and world powers, which could lead to Washington lifting sanctions on Iran’s energy sector. Goldman Sachs said any potential recovery in Iranian oil exports would not be a shock to the market, and full recovery would not occur until summer 2022. Meanwhile, tensions between Saudi Arabia and India simmered. Indian state refiners plan to buy 36% less oil from Saudi Arabia in May than normal, three sources said. 

WTI Drops After Big Surprise Product Inventory Builds -Oil prices ended higher today, but closed back below $60 after a big roundtrip as overnight hopes limped away as a sense that Biden's infrastructure plan may not be as big as the bulls had hoped, raising further doubts around energy demand.Investors read the decision by OPEC+ to gradually increase market supply as a statement of confidence in demand late last week, although fresh lockdown measures in Europe and rising Covid-19 cases elsewhere have served to quickly drain that optimism."The current situation is fragile, therefore revisiting the recent highs (of oil prices) ... is not imminent”commented PVM analyst Tamas Varga, before adding that “until there are palpable signs of falling infection rates the oil market is likely to remain violent and hectic”.For now, the algos are focused on one number only...API

  • Crude -2.618mm
  • Cushing -84k
  • Gasoline +4.553mm
  • Distillates +2.81mm

Crude stocks drew down for the second week in a row, but the big surge in product inventories is a surprise...Graphics Source: Bloomberg.  WTI hovered around $59.50 ahead of the API data and slipped lower after... We suspect the next mnove will be triggered by headlines surrounding the fact that Western and Iranian officials kicked off talks to revive the embattled 2015 nuclear accord, amid the challenge of bitter relations between Washington and Tehran, punishing U.S. sanctions on the Islamic Republic, and moves by Iran to accelerate its nuclear activity.

OPEC daily basket price stood at $60.68 a barrel Wednesday --- The price of OPEC basket of thirteen crudes stood at US$60.68 a barrel on Wednesday, 7th April 2021, compared with $61.33 the previous day, according to OPEC Secretariat calculations. The OPEC Reference Basket of Crudes is made up of the following: Saharan Blend (Algeria), Girassol (Angola), Djeno (Congo), Zafiro (Equatorial Guinea), Rabi Light (Gabon), Iran Heavy (Islamic Republic of Iran), Basra Light (Iraq), Kuwait Export (Kuwait), Es Sider (Libya), Bonny Light (Nigeria), Arab Light (Saudi Arabia), Murban (UAE) and Merey (Venezuela).

Oil up on global economic recovery, but hefty U.S. fuel stocks weigh -(Reuters) -Oil futures inched higher on Wednesday on an improving global economic outlook, but gains were capped by rising gasoline inventories and fears that new coronavirus outbreaks will weaken a global recovery in fuel demand. Brent crude futures settled at $63.16 a barrel, up 42 cents, or 0.7%. U.S. West Texas Intermediate crude settled at $59.77 a barrel, gaining 44 cents, or 0.7%. U.S. crude stocks fell 3.5 million barrels last week, but gasoline inventories jumped 4 million barrels, the Energy Information Administration (EIA) said, compared with expectations in a Reuters poll for a 221,000-barrel gasoline drop. [EIA/S] “If you don’t need to make gasoline, then you don’t need to use more crude oil,” Prices drew support when the Federal Reserve released minutes from last month’s meeting that reinforced the U.S. central bank’s position that it will refrain from raising rates anytime soon, boosting the fuel demand outlook. The International Monetary Fund on Tuesday said unprecedented public spending to fight COVID-19 would push global growth to 6% this year, a rate not achieved since the 1970s, which also helped the fuel demand outlook and supported prices. However, rising COVID-19 cases in the Americas, which accounted for more than half of all coronavirus-related deaths last week, capped gains. “There’s concern globally with the rise in COVID-19 cases again and now Canada staring down a third wave, the market continues to be haunted by these demand issues from the outbreaks,” Also, global crude supplies could increase as Iran and major world powers took steps toward reviving an agreement that froze Iran’s nuclear weapons development. The parties agreed to form working groups to discuss the possibility of reviving the 2015 deal that could lead to Washington lifting sanctions on Iran’s energy sector. “Iran is the single largest upside supply risk for the oil market,”  Oil prices dropped earlier this week after the Organization of the Petroleum Exporting Countries (OPEC) and allies, a group known as OPEC+, agreed to gradually ease oil output cuts from May.

Oil flat as weaker dollar offsets coronavirus demand worries (Reuters) -Oil prices were little changed on Thursday as a falling dollar and rising stock markets offset earlier declines caused by a big increase in U.S. gasoline stockpiles and subdued demand compared with pre-pandemic levels. Brent futures rose 4 cents, or 0.1%, to settle at $63.20 a barrel, while U.S. West Texas Intermediate (WTI) crude ended 17 cents, or 0.3%, lower at $59.60. “Crude prices are struggling for direction as short-term COVID pressures are countered by a much weaker U.S. dollar,” said Edward Moya, senior market analyst at OANDA in New York. The U.S. dollar fell to a two-week low against a basket of currencies, tracking Treasury yields lower, after data showed a surprise rise in U.S. weekly jobless claims. U.S. gasoline inventories rose sharply by 4 million barrels to a little more than 230 million barrels as refiners ramped up output before the summer driving season, the U.S. Department of Energy said on Wednesday. “A huge build in road fuel stocks is not what the market was expecting and concerns over the speed of the oil demand recovery resurfaced, leaving traders wondering how stable road fuel usage actually is,”.

Oil edges lower on mixed supply and demand outlook  - Oil prices edged lower in rangebound trade on Friday on rising supplies from major producers and concerns over a mixed picture on the COVID-19 pandemic’s impact on fuel demand. Brent crude futures for June fell 16 cents, or 0.3%, to $63.04 a barrel by 1:38 p.m. EDT (1738 GMT). U.S. West Texas Intermediate (WTI) crude for May was at $59.38, down 22 cents. Both contracts are on track for a 2%-3% drop this week but still far from a low of $60.47 hit two weeks ago. Downward pressure has been exerted by the decision of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+, to increase supplies by 2 million barrels per day between May and July. “Favorable oil demand prospects are being largely offset by the expected increase in OPEC + production that could be approximating 2 million barrels per day by the end of July,” Meanwhile U.S. drillers kept the number of oil rigs unchanged this week, energy services firm Baker Hughes Co said on Friday, with analysts forecasting more rigs were needed to keep production steady. Renewed lockdowns in some parts of the world and problems with vaccination programs could threaten the oil demand picture. Oil prices are expected to trade in a range between $60 and $70 as investors weigh these factors. “There’s real push-pull in the market based on vaccination acceleration, increased production and new lockdowns, which is why we are moving sideways,” 

Oil Futures Show Biggest Loss in Weeks - -- Oil posted its worst week in three amid concerns that rising global coronavirus cases are slowing the economic recovery. West Texas Intermediate futures ended the week down 3.5%, the biggest weekly loss since mid-March. With the Organization of Petroleum Exporting Countries and its allies planning to start raising output, markets are now focused on whether the demand recovery will be enough to absorb growing supplies. While consumption is climbing in India and the U.S., rising virus cases and the possibility of stricter travel limits in Europe are muddying the forecast and putting pressure on crude. Oil plunged Monday after the U.K. said it may delay global travel beyond May 17. “The Covid situation has really not had a strong recovery in Europe and across many emerging markets, and that’s really weighed down the demand outlook for oil,” A stronger dollar also weighed on oil Friday, reducing the appeal of commodities priced in the currency. A higher-than-expected rise in U.S. March producer prices stoked inflation concerns. “If we get some hotter inflation readings, that could send Treasury yields higher again,” negatively impacting oil, according to Moya. Saudi Arabia said it remains confident that OPEC+ made the right decision to increase production over the next three months, and there are signs of better days ahead for demand that could soak up the additional barrels. India’s oil-products demand in March rose to the strongest since late 2019, while Germany reiterated support for a short, strict lockdown in the country. In the U.S., traffic is roaring back in some cities, an indication of stronger demand this summer. Making the calculation even more complex are ongoing talks between Iran and world powers to resuscitate a 2015 nuclear deal, which would set the stage for the Persian Gulf to increase supply. Negotiations are set to continue next week, though no direct contacts between Iranian and U.S. envoys have yet been made. WTI for May delivery fell 28 cents to settle at $59.32 a barrel. Brent for June declined 25 cents to end the session at $62.95 a barrel. The contract fell 2.9% over the week. Crude in New York has around $60 a barrel since mid-March, with market volatility slumping to the lowest in a month. Prices haven’t broken out of a $5 trading range over recent weeks, and have oscillated in smaller and smaller bands with each passing day -- creating a technical pattern some see as indicative of a breakout higher.

Israel escalates attacks on Iran, targeting vessel in Red Sea - In a deliberate and provocative escalation of its offensive against Iran, Israel mined the cargo ship MV Saviz, owned by the state-linked Islamic Republic of Iran Shipping Lines, in the Red Sea on Tuesday morning. It signals Israel’s determination to continue its naval offensive against Iran, despite potential reprisals from Tehran and the danger of an escalation into all-out war, as the major powers meet with Iran in Vienna to discuss a return to the 2015 nuclear accord, known as the Joint Comprehensive Plan of Action (JCPOA), unilaterally abandoned by former President Trump. The New York Times cited an unnamed American official as saying that Israel had informed the US that its navy had attacked the vessel near the Djibouti coast, claiming the attack was in retaliation for earlier Iranian strikes on Israeli vessels. According to Iranian Foreign Ministry spokesman Saeed Khatibzadeh, Tuesday’s explosion, caused by “limpet mines attached to the hull of the ship, resulted in only minor damage.” He added that the Saviz was a “non-military ship” helping to “provide security along shipping lines and combat pirates” in the Red Sea and the Bab el-Mandeb strait, a crucial chokepoint in international shipping. US and Saudi analysts claim the vessel, present in the Red Sea since late 2016, is a “mothership” for the Iranian Revolutionary Guards Corps’ flotilla of ships in the Red Sea and that uniformed men and a class of small boats used by the Guards have been photographed on board the ship’s deck. It is believed to play a crucial role in Tehran’s efforts to evade sanctions by transferring oil shipments midsea to non-Iranian flagged vessels. The Israeli attack is part of its long-running, covert offensive by its naval, air, security and intelligence forces against Iran. A report in Ha’aretz puts the number of Iranian tankers sabotaged at around 20, with an estimated loss to Al Quds, Hezbollah and the Shi’ite militias of $500,000 over two and a half years. These attacks, which damaged but deliberately avoided sinking the vessels, were for the dual purpose of disrupting Iran’s supply of oil to Syria and choking off the revenue stream that paid the Shi’ite militias and Hezbollah supporting the Syrian regime forces. The newspaper also confirmed earlier Syrian and Iranian claims about an explosion on an Iranian tanker in the Red Sea in late 2019. Such military attacks on civilian vessels in international waters are flagrant breaches of international law, potentially exposing Israel to international court actions. By escalating the dangers to shipping, they could also lead to an increase in insurance premiums for maritime commerce in the region.

Pentagon Publishes Photos Of Syrian Kurds Training To Call In Airstrikes - Last month, US Air Force Joint Terminal Attack Controllers (JTACs) trained members of the Kurdish-led Syrian Democratic Forces (SDF) during live-fire attack helicopter exercises. JTACs direct military aircraft during combat and pictures published on a Pentagon website show the JTACs training SDF members to call in airstrikes, which appears the first time the US is giving non-state actors such training, at least publicly.  According to a report from Air Force Times, the pictures might be the first time JTAC training with the SDF is publicized, but the training is nothing new. SDF fighters have had the ability to call in US airstrikes for years now.The report said the SDF fighters were not trained to be JTACs themselves but relayed coordinates to US JTACs who would then order the airstrikes. During the campaign against ISIS in the Syrian city of Raqqa, which was decimated by US bombs in 2017, some SDF members were given an app for their tablets that they could put GPS coordinates into, which they would share with JTACs through encrypted messaging. The Biden administration has made it clear it will continue occupying northeast Syria and supporting the SDF. While this support is framed as part of the fight against ISIS, it is more about keeping the oil resources in the region out of the hands of the Syrian government in Damascus.On top of the occupation of the oil fields, the US maintains crippling economic sanctions on Syria that specifically target reconstruction, preventing Syria from rebuilding after a decade of war.Meanwhile, Syria's army recently published combat training footage of its own:The sanctions have had a devastating impact on the civilian population. According to the UN, 12.4 million Syrians are facing starvation.

Washington brings Syria’s Al Qaeda in from the cold - Ten years after Washington launched a bloody war for regime change in Syria that has left some half a million dead and the country in ruins, the US media has begun an unmistakable propaganda campaign to rehabilitate the principal American proxy ground force in this war, Al Qaeda. This is the significance of an extraordinary interview conducted by the Public Broadcasting Service’s (PBS) Frontline program. Its subject is Abu Mohammad al-Jolani, the founder of the Syrian affiliate of Al Qaeda. The US State Department has declared Jolani a “Specially Designated Global Terrorist,” with a $10 million bounty on his head. The interview, to be aired soon on PBS, was conducted in February in Syria’s northwestern Idlib province, the last redoubt of the Al Qaeda-linked Islamist militias that formed the backbone of the war to topple the government of President Bashar al-Assad. This war was justified in the name of “democracy” and “human rights,” and supported by layers of the pseudo left internationally, who went so far as to proclaim it a “revolution.” In reality, it was orchestrated, armed and funded by the US, together with its regional allies Saudi Arabia, Qatar, Turkey and Israel. It grew to become one of the largest operations in the history of the CIA, with a reported annual budget of nearly $1 billion. Washington kept up the pretense that its arms and money were flowing to “vetted” and “moderate” Syrian “rebels.” In reality, it was the militias linked to Al Qaeda, which included Islamist fighters from Turkey, Iraq, Libya and as far away as Chechnya and China’s Xinjiang region, that dominated the anti-Assad forces and became the biggest beneficiaries of US largesse. Jolani led the largest of these forces, the Al Nusra Front, Al Qaeda’s Syrian affiliate. In April 2013, he released a recorded message stating, “The sons of Al Nusra Front pledge allegiance to Sheikh Ayman al-Zawahiri,” successor to Osama bin Laden as leader of Al Qaeda, following the latter’s death in 2011. At the time, Jolani was working in close collaboration with ISIS leader Abu Bakr al-Baghdadi. He severed Al Nusra’s formal connection to Al Qaeda in 2016. The interview conducted by Frontline’s Martin Smith is essentially a “media show”—Smith’s own words—staged to whitewash the bloody history of the Al Nusra Front’s terrorism in Syria and provide Jolani with a forum for proclaiming the front’s current iteration, Hayat Tahrir Al-Sham (HTS), a legitimate political force and natural ally of Washington. The terrorist designation attached to himself and his organization was “unfair” and “political,” Jolani said. Smith asked Jolani to take a pledge: “Will you say here and now then, very clearly, that you as a former Al Qaeda leader … will not support … any attacks against the United States?” The Al Qaeda veteran readily accepted.

Jordan prince told to stop “destabilising activities” after more than a dozen arrests -In an unprecedented move, Jordan’s foreign minister Ayman Safadi has accused Prince Hamza, the former crown prince and half-brother of King Abdullah, of plotting with foreign and local parties to destabilise the country.The details are far from clear as the Jordanian authorities have released little information. Hamza is believed to be under house arrest, although officials deny this, while 14 to 16 former insiders have been arrested. According to the government-controlled Petra News Agency, all who were “arrested, among others, for security reasons” were unnamed except for Sharif Hassan bin Zaid and Bassem Awadallah.Hamza, the 40-year-old son of the late King Hussein and his fourth wife Noor, attended an elite school in Britain before going on for military training at Sandhurst. Designated Abdullah’s successor until 2004, and then largely sidelined, Hamza has caused tensions within the palace by forging links with disaffected members of Jordan’s powerful tribes, the East Bankers, who form the bedrock of support for the monarchy and feel marginalised by the presence of the West Bankers, the Palestinians displaced by Israel in the Arab-Israeli wars of 1948-49 and 1967.On Saturday afternoon, after the Jordanian Armed Forces chief of staff visited Hamza at his home to give him an official warning to stop his “destabilising activities,” the BBC published a video of Hamza, passed on by his lawyer, in which he denied being part of any “conspiracy or nefarious organisation or foreign-backed group.”In the video, Hamza claimed he had been placed under house arrest, with his telephone and internet connections cut, as part of a crackdown on critics. He lambasted the ruling elite in very general terms for its rampant corruption and nepotism, the outlawing of opposition and dissent, including any criticism of the king, and the all-pervasive security and intelligence services, all of which is common currency. On Monday evening, Hamza signed a letter of loyalty to Abdullah, following a meeting with Prince Hassan, the king's uncle, and other princes, just hours after saying he would disobey orders by the army not communicate with the outside world after he was put under house arrest.

Former Jordanian crown prince under house arrest for alleged attempted coup - Former Jordanian Crown Prince Hamzah bin Hussein was put under house arrest early Saturday after allegedly plotting a coup against his half brother King Abdullah, sources familiar with the situation tell Axios.Jordanian security forces arrested more than 20 former Jordanian officials, including former chief of the royal court Bassem Awadallah, Prince Hamza’s chief of staff Yasser Majali and former Jordanian envoy to Saudi Arabia Hassan Bin Zayed.A security official told the official Jordanian news agency Petra that all suspects other than the crown prince had been under surveillance for some time and were arrested on security charges. Petra denied that Hamza was under house arrest or arrested. The Washington Post first reported about the former crown prince arrest. In a video published by the BBC, Prince Hamza said the chief of the general staff of the Jordanian Army arrived at his house Saturday morning and informed him he was not permitted to leave or communicate with others because in meetings he was present for and social media posts he was mentioned in there was criticism of the king and the government."I asked him if I was the one criticizing and he said 'no,'" Hamza said. "He said this was a warning from him, from the chief of police and from the head of intelligence that I should not leave my house, that I could not tweet or meet my family." He added that several of his friends had been arrested, his security removed and his phone lines cut. He said his internet connection is going to be disabled and he might not be able to communicate further. "I am not the person in charge of the corruption and incompetence in our government," Hamza said in the video. "I am not responsible for the lack of faith of people in the government."  Hamza denied he was behind any conspiracy or that he was backed by any foreign element. He said the government was lying and stressed he was suffering retaliation by the government because of his criticism.

US Special Forces sent into Mozambique amid growing civil war -  Amid an escalating armed conflict in Mozambique, the Pentagon has sent US Special Operations troops into the southern African nation. The deployment of these troops, described as “trainers” and “advisers,” and justified in the name of the endless “war on terrorism,” provides fresh confirmation of the Biden administration’s global escalation of US militarism, including on the continent of Africa.Announced in the middle of last month, the US deployment has come amid a sharp escalation in the civil war being fought in Mozambique’s northern-most province of Cabo Delgado, where the Mozambican government is confronting an insurgency among that region’s predominantly Muslim population.The latest fighting has centered in the town of Palma, a hub for the exploitation of the country’s natural gas fields, which was seized by the rebels at the end of last month, sending an estimated 11,000 people fleeing to the port city of Pemba on the Indian Ocean. According to the United Nations, some 670,000 have been displaced since fighting began in the region in 2017.Commander Chongo Vidigal, the chief of the government forces sent to retake Palma from the rebels told the media Sunday that the area was now “safe.” An earlier attempt to bring reporters to the scene, however, was aborted after the helicopter flying them to the town came under fire. The main objective of the military operation was to secure the site of a $60 billion liquefied natural gas project initiated by the French energy giant Total, which has demanded a 15-mile secure perimeter as a condition for its continued presence. Having resumed operations only on March 24 after shutting down its facilities following an earlier rebel offensive at the beginning of the year, Total has shut down again, pulling all of its employees out of the region. In addition to the French-based energy transnational, Italy’s ENI and the US-based ExxonMobil also have interests in Mozambique’s natural gas reserves, believed to be among the largest on the planet.

UN condemns French airstrike on wedding in Mali that slaughtered 22 -- In a report made public last week, the United Nations has revealed that the French military launched an airstrike on a wedding ceremony in Mali at the beginning of the year, slaughtering at least 22 people. The airstrike took place at 3:00 p.m. on January 3, near the town of Bounty in the center of the country. According to the report by the United Nations Mission in Mali (MINUSMA), the religious ceremony for the marriage had taken place the evening before in Gana, approximately seven kilometers away. The following morning, approximately 100 people came from their homes in Bounty and smaller surrounding settlements to celebrate the marriage. As is normal in the local custom, the men were gathered in a separate area from the women and children. The French airstrike hit the gathering of men, killing 22. Little has been publicly reported about the victims, except that they were aged between 23 and 71. The report states that 19 of the victims were civilians, and three were members of an armed Islamist group named Katiba Serma. However, it makes clear that there is no evidence that any of them were involved in any ongoing military operations against French armed forces and were therefore also protected under international law. The MINUSMA report is the product of a weeks long investigation on the ground by a team of 19 UN staff, including two police science investigators. From January 4 to February 20, they traveled to the towns of Bamako, Sévaré, Douentza and Bounty. They conducted interviews with more than 115 people individually and another 200 people in groups, including family members of the victims, witnesses, and representatives of local community associations and medical responders. Their report exposes the lies of the French army and the Macron government following the attack. Immediately after the airstrike, the Macron government insisted that it had hit a gathering of 30 members of an “armed terrorist group.” On January 20, Minister for the Armed Forces Florence Parly was questioned about the attack during a hearing before the Senate Commission for Foreign Affairs. Parly called reports of an attack on civilians as an example of “information warfare” and “rumours” being used to discredit the French occupation of the Sahel.