oil prices again ended slightly higher this week, as markets gyrated after a major oil product pipeline was hacked and shut down...after rising 2.1% to $64.90 a barrel last week as traders anticipated higher demand for fuel as global economies eased Covid-related restrictions, the contract price of US light sweet crude for June delivery opened more than 1% higher Monday after the Colonial Pipeline had to shut fuel pipelines to the East Coast due to a cyberattack, but faded to end just 2 cents higher at $64.92 a barrel on expectations that the U.S. would have to slow refining activities and boost imports of gasoline....oil prices fell early Tuesday as the prospect that the East Coast pipeline would remain shut for the rest of this week led some U.S. Gulf Coast refiners to cut output, but rallied late finish the session 36 cents higher at $65.28 a barrel as a weaker dollar lent support to prices and offset the burgeoning pile up of crude in the Gulf Coast states...however, oil prices slid again overnight after the API reported the largest increase in gasoline inventories in over a year, but recovered on Wednesday to end 80 cents higher at $66.08 a barrel, after the EIA reported just a modest increase in gasoline inventories while a second straight weekly decline in U.S. crude supplies underscored the progress made in draining last year's record supply glut built up...oil prices then tumbled early Thursday after data showed that the U.S. annual inflation rate jumped to the highest in 13 years, and finished $2.36, or more than 3% lower at $63.82 a barrel after the Colonial pipeline reopened and India’s festering Covid situation, which was killing more than 4,000 people a day, added to the downward pressure on prices...but oil prices recovered two-thirds of those losses on Friday, rising $1.55 to $65.37 a barrel, as prices garnered support from a recovery in US equities and a softer US dollar and thus managed to finish the week 0.7% higher, as traders positioned for higher inflation and weaker-than-expected macroeconomic data in the US...
natural gas prices also inched up this week, as strong LNG exports and lower production offset moderating weather forecasts....after rising 0.9% to to $2.958 per mmBTU last week on near record exports and on forecasts for a cooling trend, the contract price of natural gas for June delivery opened higher on Monday, but quickly eased on forecasts for milder weather and a small decline in exports, with prices settling down 2.6 cents, or 0.9%, $2.932 per mmBTU...however, prices reversed course on Tuesday, rising with oil prices and settling 2.3 cents higher at $2.955 per mmBTU, as export demand and other key fundamentals held strong...natural gas prices then rose 1.4 cents to an 11 week high of $2.969 per mmBTU on Wednesday as field production dipped and all indications pointed to continued strong demand for LNG...prices ticked up four-tenths of a cent to another 11 week high on Thursday, as a natural gas storage report in line with expectations provided no catalyst for a change...but June gas contracts slipped 1.2 cents on Friday as exports declined and production edged up, and on forecasts for mild weather and lower demand next week, but still finished the week three-tenths of a cent or 0.1% higher at $2.961 per mmBTU...
the natural gas storage report from the EIA for the week ending May 7th indicated that the amount of natural gas held in underground storage in the US rose by 71 billion cubic feet to 2,029 billion cubic feet by the end of the week, which left our gas supplies 378 billion cubic feet, or 15.7% below the 2,407 billion cubic feet that were in storage on May 7th of last year, and 61 billion cubic feet, or 3.4% below the five-year average of 2,101 billion cubic feet of natural gas that have been in storage as of the 7th of May in recent years....the 71 billion cubic feet that were added to US natural gas storage this week was in line with the average forecast of a 70 billion cubic foot addition from an S&P Global Platts survey of analysts, but was below the average addition of 82 billion cubic feet of natural gas that have typically been injected into natural gas storage during the first week of May over the past 5 years, as well as well below the 104 billion cubic feet added to natural gas storage during the corresponding week of 2020...
The Latest US Oil Supply and Disposition Data from the EIA
US oil data from the US Energy Information Administration for the week ending May 7th showed that despite a reoord drop in our oil exports, we still needed to withdraw oil from our stored commercial crude supplies for the fifth time in twelve weeks and for the 27th time in the past forty-two weeks....our imports of crude oil rose by an average of 37,000 barrels per day to an average of 5,488,000 barrels per day, after falling by an average of 1,164,000 barrels per day during the prior week, while our exports of crude oil fell by a record average of 2,326,000 barrels per day to an average of 1,796,000 barrels per day during the week, which meant that our effective trade in oil worked out to a net import average of 3,692,000 barrels of per day during the week ending May 7th, 2,363,000 more barrels per day than the net of our imports minus our exports during the prior week...over the same period, the production of crude oil from US wells was reportedly 100,000 barrels per day higher at 11,000,000 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 14,692,000 barrels per day during this reporting week...
meanwhile, US oil refineries reported they were processing 15,020,000 barrels of crude per day during the week ending May 7th, 223,000 fewer 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 261,000 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 67,000 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 (+67,000) 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 size in this week's oil supply & demand figures that we have just transcribed....while that's not off by much, last week's EIA fudge factor was at (+1,722,000) barrels per day, which means there was a 1,655,000 barrel per day balance sheet difference in the unaccounted for crude oil figure from a week ago, rendering the week over week supply and demand changes we have just transcribed meaningless....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 fell to an average of 5,740,000 barrels per day last week, which is still 7.6% more than the 5,336,000 barrel per day average that we were importing over the same four-week Covid impacted period last year... the 261,000 barrel per day net withdrawal from our crude inventories included a 200,000 barrel per day withdrawal from our Strategic Petroleum Reserve, space in which has been leased for commerical purposes, and a 61,000 barrel per day withdrawal from our commercially available stocks of crude oil....this week's crude oil production was reported to be 100,000 barrels per day higher at 11,000,000 barrels per day because the rounded estimate of the output from wells in the lower 48 states was 100,000 barrels per day higher at 10,500,000 barrels per day while a 6,000 barrel per day decrease in Alaska's oil production to 451,000 barrels per day had no impact on the rounded national total....our prepandemic record high US crude oil production was at a rounded 13,100,000 barrels per day during the week ending March 13th 2020, so this reporting week's reported oil production figure was 16.0% below that of our production peak, yet still 30.5% 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 86.1% of their capacity while using those 15,020,000 barrels of crude per day during the week ending May 7th, down from 86.5% the prior week, and below normal for the month before the summer driving season...while the 15,020,000 barrels per day of oil that were refined this week were 21.3% higher than the 12,383,000 barrels of crude that were being processed daily during the pandemic impacted week ending May 8th of last year, they were still 9.9% below the 16,676,000 barrels of crude that were being processed daily during the week ending May 10th, 2019, when US refineries were operating at a still lower than seasonal 90.5% of capacity...
even with this week's decrease in the amount of oil being refined, the gasoline output from our refineries increased by 442,000 barrels per day to 9,588,000 barrels per day during the week ending May 7th, after our gasoline output had decreased by 483,000 barrels per day over the prior week...and while this week's gasoline production was 27.9% higher than the 7,497,000 barrels of gasoline that were being produced daily over the same week of last year, it was still 3.9% lower than the March 13th 2020 pre-pandemic high of 9,974,000 barrels per day, and 3.3% below the gasoline production of 9,912,000 barrels per day during the week ending May 10th, 2019....meanwhile, our refineries' production of distillate fuels (diesel fuel and heat oil) increased by 157,000 barrels per day to 4,655,000 barrels per day, after our distillates output had decreased by 128,000 barrels per day over the prior week... but since the onset of the pandemic last year didn't appear to impact distillates' production, this week's distillates output was still 4.8% lower than the 4,892,000 barrels of distillates that were being produced daily during the week ending May 8th, 2020...
with the increase in our gasoline production, our supply of gasoline in storage at the end of the week increased for the twentieth time in twenty-six weeks, and for 24th time in 44 weeks, rising by 378,000 barrels to 236,189,000 barrels during the week ending May 7th, after our gasoline inventories had increased by 737,000 barrels over the prior week...our gasoline supplies managed to increase again this week even though our exports of gasoline rose by 439,000 barrels per day to 994,000 barrels per day while our imports of gasoline fell by 85,000 barrels per day to 936,000 barrels per day, as the amount of gasoline supplied to US users decreased by 64,000 barrels per day to 8,800,000 barrels per day....but even after six straight inventory increases, our gasoline supplies were still 6.6% lower than last May 8th's gasoline inventories of 256,407,000 barrels, and about 1% below the five year average of our gasoline supplies for this time of the year...
however, even with the increase in our distillates production, our supplies of distillate fuels decreased for the 11th time in 21 weeks and for the 25th time in thirty-seven weeks, falling by 1,734,000 barrels to 134.419,000 barrels during the week ending May 7th, after our distillates supplies had decreased by 2,896,000 barrels during the prior week....our distillates supplies fell by a bit less this week because the amount of distillates supplied to US markets, an indicator of our domestic demand, fell by 157,000 barrels per day to 3,968,000 barrels per day, while our imports of distillates rose by 39,000 barrels per day to 109,000 barrels per day, and while our exports of distillates rose by 187,000 barrels per day to 1,143,000 barrels per day....after five consecutive inventory decreases, our distillate supplies at the end of the week were 13.3% below the 155,001,000 barrels of distillates that we had in storage on May 8th, 2020, and about 3% below the five year average of distillates stocks for this time of the year...
finally, in spite of the big drop in our oil exports, our commercial supplies of crude oil in storage fell for the 15th time in the past twenty-six weeks and for the 27th time in the past year, decreasing by 426,000 barrels, from 485,117,000 barrels on April 30th to 484,691,000 barrels on May 7th, after our crude supplies had decreased by 7,990,000 barrels the prior week....after this week's decrease, our commercial crude oil inventories remained about 2% below the most recent five-year average of crude oil supplies for this time of year, but were still about 37% above the average of our crude oil stocks as of the the first week of May 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 Covid lockdowns of last spring, our commercial crude oil supplies as of May 7th were 8.8% less than the 531,476,000 barrels of oil we had in commercial storage on May 8th of 2020, but still 2.7% more than the 472,035,000 barrels of oil that we had in storage on May 10th of 2019, and also 12.1% more than the 432,354,000 barrels of oil we had in commercial storage on May 11th of 2018...
OPEC's Monthly Oil Market Report
Tuesday of this past week saw the release of OPEC's May Oil Market Report, which covers OPEC & global oil data for April, and hence it gives us a picture of the global oil supply & demand situation for the 4th month after OPEC, the Russians, and other oil producers agreed to increase their oil production by 500,000 barrels per day starting January, from their prior 2020 commitment to cut production by 7.7 million barrels a day from an October 2018 peak, which had been earlier reduced from the 9.7 million barrels a day cuts they had imposed on themselves during May, June and July of 2020, and after the Saudis unilaterally committed to cut their own production by a million barrels per day during February, March, and then later during April of this year...before we start, we want to again caution that the oil demand estimates made herein, while the course of the Covid-19 pandemic still remains uncertain, should be considered as having a much larger margin of error than we'd expect from this report during stable and hence more predictable periods..
the first table from this monthly report that we'll check is from the page numbered 50 of this month's report (pdf page 60), and it shows oil production in thousands of barrels per day for each of the current OPEC members over the recent years, quarters and months, as the column headings below indicate...for all their official production measurements, OPEC uses an average of estimates from six "secondary sources", namely the International Energy Agency (IEA), the oil-pricing agencies Platts and Argus, the U.S. Energy Information Administration (EIA), the oil consultancy Cambridge Energy Research Associates (CERA) and the industry newsletter Petroleum Intelligence Weekly, as a means of impartially adjudicating whether their output quotas and production cuts are being met, to thereby avert any potential disputes that could arise if each member reported their own figures...
as we can see from the above table of their oil production data, OPEC's oil output increased by a rounded 26,000 barrels per day to 25,083,000 barrels per day during April, up from their revised March production total of 25,057,000 barrels per day...however, that March output figure was originally reported as 25,042,000 barrels per day, which therefore means that OPEC's March production was revised 15,000 barrels per day higher with this report, and hence OPEC's March production was, in effect, a 41,000 barrel per day increase from the previously reported OPEC production figure (for your reference, here is the table of the official March OPEC output figures as reported a month ago, before this month's revision)...
from the above table, we can see that an increase of 75,000 barrels per day in Nigeria's output, a 73,000 barrels per day increase in Iran's production, and a production increase of 34,000 barrels per day from the Saudis were the major factors in OPEC's March output increase; , and that those increases we mostly offset by a decrease of 81,000 barrels per day in the output from Venezuela and a decrease of 67,000 barrels per day in the output from Libya, coincidentally two of the countries that have remained exempt from any of the quotas imposed on other members by these output cuts....recall that last year's original oil producer's agreement was to cut production by 9.7 million barrels per day from an October 2018 baseline for just two months early in the pandemic, during May and June, but that agreement had been extended to include July at a meeting between OPEC and other producers on June 6th....then, in a subsequent meeting in July, OPEC and the other oil producers agreed to ease their deep supply cuts by 2 million barrels per day to 7.7 million barrels per day for August and subsequent months, which was thus the agreement that covered OPEC's output for the rest of 2020...the OPEC+ agreement for January's production, which was later extended to include February and March and then April's output, was to further ease their supply cuts by 500,000 barrels per day to 7.2 million barrels per day from that original baseline...however, war torn Libya and US sanctioned OPEC members Iran and Venezuela have been exempt from the production cuts imposed by these agreements, and as we can see above, they all had significant production changes this month...
for those OPEC members that do fall under the output quotas imposed by that series of revised agreements, we have below a table of the output levels they were "voluntarily" required to adhere to in April, reflecting the extension of the production levels designated for March through the month of April:
the above table was provided as a downloadable attachment to the press release following the press release following the 13th OPEC and non-OPEC Ministerial Meeting on January 5th of this year, and it includes the reference production and expected production levels for the 10 members of OPEC that are expected to make cuts and for the other major oil producers who are party to what the press calls the "OPEC + agreement"....the first column in the above table shows the reference oil production baseline, in thousands of barrel per day, from which each of the oil producers was to cut from, a figure which is based on each of the producer's October 2018 oil output, ie., a date before last year's and the prior year's output cuts took effect, and coincidently the highest monthly production of the era for most of the producers who are party to these cuts...the remaining columns show the adjustment, or cut, from that reference production level and then the oil output allowed for each producer under the agreement for the months of January, February and March, which were extended to include April at the March level at the 14th OPEC and non-OPEC Ministerial Meeting on March 4th...OPEC arrived at these figures by adjusting the 23% cut from the October 2018 baseline originally agreed to for May and June 2020 for subsequent agreements to "ease" that 23% cut by agreed to fractions, and it applied to all participants except for Mexico, who already had their oil production hedged to profit from lower prices...the OPEC member output quota is identical for each of the three months covered above; however, the ongoing agreements from the OPEC and non-OPEC Ministerial Meetings have subsequently allowed Russia and Kazakhstan to incrementally increase their oil output over February and March to meet seasonal increases in domestic demand, and again in April at the March 4th meeting cited above....in April, both Iraq, with an oil output of 3,920,000 barrels per day, and Nigeria, with an output of 1,548,000 barrels per day, were producing more than their quota, but that excess output was more than covered by the Saudis unilaterally keeping their production a million barrels per day below their quota...
the next graphic from this month's report that we'll highlight shows us both OPEC and world oil production monthly on the same graph, over the period from May 2019 to April 2021, and it comes from page 51 (pdf page 61) of OPEC's April Monthly Oil Market Report....on this graph, the cerulean blue bars represent OPEC's monthly oil production in millions of barrels per day as shown on the left scale, while the purple graph represents global oil production in millions of barrels per day, with the metrics for global output shown on the right scale....
after this month's reported 26,000 barrel per day increase in OPEC's production from what they produced a month earlier, OPEC's preliminary estimate indicates that total global liquids production decreased by a rounded 150,000 barrels per day to average 93.06 million barrels per day in April, a reported decrease which apparently came after March's total global output figure was revised down by 20,000 barrels per day from the 93.23 million barrels per day of global oil output that was reported for March a month ago, as non-OPEC oil production fell by a rounded 180,000 barrels per day in March after that revision, with a decrease of 500,000 barrels per day, due to planned maintenance, in the oil output from Canada and Norway accounting for the non-OPEC production decrease in April...
After that decrease in April's global output, the 93.06 million barrels of oil per day that were produced globally in April were still 6.45 million barrels per day, or 6.5% less than the revised 99.51 million barrels of oil per day that were being produced globally in April a year ago, which was the month that the first Saudi-Russian agreement to cut production to support prices broke down, resulting in oil prices briefly falling below zero (see the May 2020 OPEC report (online pdf) for the originally reported April 2020 details)...with this month's modest increase in OPEC's output, their April oil production of 25,083,000 barrels per day was at 27.0% of what was produced globally during the month, an increase of 0.1% from their revised 26.9% share of the global total in February....OPEC's April 2020 production was reported at 30,412 barrels per day, which means that the 13 OPEC members who were part of OPEC last year produced 5,329,000, or 17.5% fewer barrels per day of oil this April than what they produced a year earlier, when they accounted for 30.6% of global output...
After the modest decrease in global oil output that we've seen in this report, the amount of oil being produced globally during the month again fell short of the expected demand, as this next table from the OPEC report will show us...
the above table came from page 29 of the OPEC May Oil Market Report (pdf page 39), and it shows regional and total oil demand estimates in millions of barrels per day for 2020 in the first column, and OPEC's estimate of oil demand by region and globally quarterly over 2021 over the rest of the table...on the "Total world" line in the third column, we've circled in blue the figure that's relevant for April, which is their estimate of global oil demand during the second quarter of 2021... OPEC is estimating that during the 2nd quarter of this year, all oil consuming regions of the globe will be using an average of 94.79 million barrels of oil per day, which is a rounded 300,000 barrels per day downward revision from the 95.09 million barrels of oil per day of demand they were estimating for the second quarter a month ago (note that we have encircled this month's revisions in green), which still reflects quite a bit of coronavirus related demand destruction compared to 2019, when global demand averaged 99.98 million barrels per day....but as OPEC showed us in the oil supply section of this report and the summary supply graph above, OPEC and the rest of the world's oil producers were only producing 93.06 million barrels million barrels per day during April, which would imply that there was a shortage of around 1,730,000 barrels per day in global oil production in April when compared to the demand estimated for the month...
note that in green we have also circled a downward revision of 140,000 barrels per day to OPEC's previous estimates of first quarter demand...for March, that means that that the 200,000 barrels per day global oil output shortage we had previously figured for March would be revised to a shortage of just 80,000 barrels per day, after the downward revision of 20,000 barrels per day to March's global oil output that's implied in this report is also taken into account... similarly, the downward revision to first quarter demand means that the 1,430,000 barrels per day global oil output shortage we had previously figured for February would now be revised to a shortage of 1,290,000 barrels per day, and that the 210,000 barrels per day global oil output shortage we had previously figured for January would be revised to a shortage of 70,000 barrels per day, in light of the 140,000 barrel per day downward revision to first quarter demand...note, however, that despite this year's output shortfalls, the quantities of oil produced globally in 2020 still averaged well over 3 million barrels per day more than anyone wanted...
This Week's Rig Count
The US rig count rose for the 31st time over the past 35 weeks during the week ending May 15th, but is still down by 42.9% from the pre-pandemic rig count....Baker Hughes reported that the total count of rotary rigs running in the US was up by 5 to 453 rigs this past week, which was also up by 114 rigs from the pandemic hit 339 rigs that were in use as of the May 15th report of 2020, but was still 1,476 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 up by 8 to 352 oil rigs this week, after rising by 2 oil rigs the prior week, thus giving us 94 more oil rigs than were running a year ago, but still just 21.9% 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 down by 3 to 100 natural gas rigs, which was still up by 21 natural gas rigs from the 79 natural gas rigs that were drilling a year ago, but still just 6.2% of the modern era high of 1,606 rigs targeting natural gas that were deployed on September 7th, 2008....meanwhile, a so-called "miscellaneous" rig continued to drill into the Permian basin in Midland county Texas this week, compared to the "miscellaneous" rig count of two a year ago..
The Gulf of Mexico rig count was up by 2 to 15 rigs this week, with all 15 of those rigs now drilling for oil in Louisiana's offshore waters....that was 3 more Gulf of Mexico rigs than the 12 rigs drilling in the Gulf a year ago, when again all 12 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...meanwhile, in addition to those rigs offshore, a rig continues to drill through an inland lake in St Mary parish Louisiana, while there were no "inland waters" rigs running a year ago...
The count of active horizontal drilling rigs was up by 2 to 410 horizontal rigs this week, which was also up by 103 rigs from the 307 horizontal rigs that were in use in the US on May 15th of last year, but less than a third of the record of 1372 horizontal rigs that were deployed on November 21st of 2014....at the same time, the directional rig count was up by 5 to 29 directional rigs this week, which was also up by 8 from the 22 directional rigs that were operating during the same week a year ago....on the other hand, the vertical rig count was down by 2 to 15 vertical rigs this week, but those were still up by 5 from the 10 vertical rigs that were in use on May 8th 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 May 14th, the second column shows the change in the number of working rigs between last week's count (May 7th) and this week's (May 14th) count, the third column shows last week's May 7th 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 15th of May, 2020..
Louisiana's rig count was up by three with the addition of three rigs offshore, but there was also a natural gas rig added in the Haynesville shale of northwestern Louisiana, while a vertical rig was shut down in the southern part of the state...the Haynesville shale was still down a rig, however, with the removal of two Haynesville natural gas rigs from Texas Oil District 6...with those, the natural gas rig count was down by three nationally, with the additional removal of two other natural gas rigs in basins that Baker Hughes doesn't track...elsewhere in Texas, we find that that two oil rigs were added in Texas Oil District 8, which is the core Permian Delaware, and that another oil rig was added in Texas Oil District 8A, which includes the northern counties of the Permian Midland, but that at the same time, an oil rig was pulled out Texas Oil District 7C, which encompasses the southern counties of the Permian Midland, thus accounting for the national Permian basin 2 rig increase....we also had a rig added in Texas Oil District 1, and a rig pulled out of Texas Oil District 2, which could have been offsetting Eagle Ford rigs, even as the Eagle Ford remained unchanged...the Texas count was still down by one, however, because the last rig that had been drilling in the state's offshore area was removed this week...meanwhile, other rig additions nationally include a rig added in North Dakota's Williston basin, and another added in Oklahoma's Cana Woodford, and an oil rig added in an Alaska basin that Baker Hughes doesn't name...
Feds appeal court order that stalls gas drilling in Ohio national forest (Reuters) - The U.S. Forest Service (USFS) and the Bureau of Land Management (BLM) have appealed to a federal appeals court rulings in Columbus federal court that prohibit them from issuing new permits to drill on oil and gas leases in Ohio's only national forest until they re-assess the environmental effects of fracking on that land. The federal agencies on Monday appealed rulings that they violated the National Environmental Policy Act (NEPA) when they failed to take a "hard look" at the environmental impacts, including on air quality, of eventual hydraulic fracturing, or fracking, of underground shale when they offered for lease about 40,000 acres of land in the Wayne National Forest in southeast Ohio. Plans to open up Wayne Forest to fossil fuel extraction go back more than a decade predating former President Donald Trump's push to open up federal lands to oil and gas exploration. Taylor McKinnon, a campaigner with co-plaintiff the Center for Biological Diversity (CBD), said: "There's a wide and dangerous chasm between the Biden administration's climate rhetoric and its defense of unlawful fracking." CBD and others made NEPA claims against USFS and the BLM in 2017, months after the agencies opened up the land for fracking. About 1,800 acres of land were leased during auctions held in 2016 and 2017. Last year, U.S. District Judge Michael Watson sided with the plaintiffs, saying that BLM's conclusion that leasing of the forested land would not significantly impact the environment, and that further analysis could wait until developers applied for drilling permits, violated NEPA. In March, Watson asked BLM and the USFS to revise their NEPA analysis and prohibited them from issuing new drilling permits in the meantime.
Biden Admin Seeks to Restart Drilling in Wayne Natl Forest -- The executive branch of the federal government, including the U.S. Forest Service (USFS) and the Bureau of Land Management (BLM), is appealing, to a federal appeals court, a Columbus federal court ruling that prohibits their respective agencies from issuing new permits to drill on oil and gas leases in Ohio’s Wayne National Forest (WNF). Talk about mixed signals! We thought old Joe had shut down and wants to keep shut down all drilling on federal land, which includes WNF (see How Biden’s Drilling Ban on Federal Lands Affects the M-U). Now Biden’s own USFS and BLM are suing to allow it!
Elected officials should stand against fossil fuels- Jill A. Hunkler -- It was an honor to testify before the House Subcommittee on the Environment on the role of federal fossil fuel subsidies in preventing action on the climate crisis. However, I was disappointed by the response from state and local government leaders who I believe misrepresented the issue, citing research published by the oil and gas industry to back up false claims of economic growth and “clean” emissions. In a recent news article, state Sen.Frank Hoagland, R-Mingo Junction, stated: “Far left attempts to vilify the significant economic opportunities brought by the oil and gas industry are patently false …” This argument is futile, as the statistics mentioned in my testimony came directly from the Bureau of Labor Statics and Bureau of Economics. It is the irrefutable truth, based on governmental data, that Appalachian fracking counties have lost 6,500 jobs and 13,000 residents since the fracking boom began.Sen. Hoagland also stated, “Additionally, other sectors and small businesses have grown with Ohio and the gas industry.”This may have been true for a short period of time, but now you can see the evidence to the contrary. The hotels and campgrounds are virtually empty, and some of the other small businesses that surfaced, like industry supply shops, are gone.[…] Commissioner Jerry Echemann stated he had faith that the oil and gas industry is alive and well. His faith is misplaced and not based on fact. The industry is still present, but activity has slowed, and companies including Gulfport, a heavy player in the county, are filing for bankruptcy. According to a 2020 study from the Institute for Energy Economics and Financial Analysis, Appalachian fracking companies have failed to produce positive free cash flow each year for the past decade.The officials are claiming that the industry has done a lot for Belmont County and that they are behind them. Why do they not acknowledge all the harms brought by this same industry? Can they still be unconcerned, or are they afraid to face the truth based on fact? This industry is polluting our air and water and causing negative health impacts to residents of Belmont County. Are we to assume that Sen. Hoagland and the Belmont County Board of Commission are willing to sacrifice the health of the people for corporate wealth?
Self-congratulatory op-ed on Ohio fracking industry glosses over health, climate impacts - cleveland.com- Congratulations to Jill Hunkler (”Ohio anti-fracking activist joins Greta Thunberg to decry fossil fuel subsidies at Earth Day congressional hearing,” cleveland.com, April 22). It takes real courage to speak truth to power, especially when that “power” is an industry that has for decades controlled a false narrative about the connection of their products to climate change. Regarding David Hill’s May 7 op-ed (”The truth on how the oil and gas industry helps communities thrive”), few full-time Ohio residents will benefit from employment in the industry. However, many of us will deal with the negative impacts. A simple search of peer-reviewed studies will provide Mr. Hill with a plethora of information about the carcinogenic health effects of petrochemicals that will profoundly impact citizens’ health in southeast Ohio. The increase in methane emissions alone counteracts any decrease in carbon-dioxide value. Much of the fracked gas will become a feedstock for single-use plastics, even though the world is drowning in plastics. We are finding out from recent research that our very ability to reproduce is being affected by plastics, plasticizers and fracking chemicals. It is time to move into the future and stop subsidizing an industry that cares nothing about the truth. Randi Pokladnik, Uhrichsville
Ohio lawmakers include language promoting oil and gas in budget bill - The Ohio House version of the 2022-23 state operating budget includes language that would make it state policy to “promote” oil and gas development, exploration and production. The House also added in provisions to make it easier to lease mineral rights under state lands. The state’s oil and gas industry welcomed these small, but significant, changes. Environmental groups are concerned about what it means for public transparency and protecting the state’s public lands. “It’s a thumb on the scale,” said Nathan Johnson, director of public lands at the Ohio Environmental Council. “It slants the playing field dramatically in favor of the industry.” Until now, it’s been basically impossible for any state agency to lease its mineral rights for oil and gas development, said Matt Hammond, president of the Ohio Oil and Gas Association. It’s not that it was illegal. There was just no process for it to happen. The law, signed in 2011 under then-Gov. John Kasich, created the Oil and Gas Leasing Commission. The commission was supposed to oversee any leasing activity on state lands. The problem, for the oil and gas industry, is that no one was appointed to the commission until 2017. That only happened after the legislature tried, through the budget bill, to take away the governor’s power to control appointments to the commission. Even after the commission was staffed, the Ohio Department of Natural Resources never promulgated any rules to govern the commission. Hammond said Gov. Mike DeWine’s administration seems more friendly toward oil and gas, so they took the opportunity to push for some of these changes. Under the language put in the House budget bill, the commission would create its own rules, including setting a standard lease to be used by state agencies. State agencies could then lease public land parcels without consulting the commission. Johnson said these changes basically render the commission obsolete and takes the leasing process out of the public eye. “It robs the public of those protections,” he said. “If we’re basically announcing a policy of drill, baby, drill in those places that Ohioans really rely on today more than they ever have, for getting out there, getting away, breathing clean air, I think that’s a sad state of affairs that we’re dealing with in Ohio right now.” According to the bill, the commission would still accept nominations for parcels to be leased and approve bids. The provisions would allow state leasing revenue to be used more broadly. The current law says those funds need to be reinvested into the public lands. The budget bill would have that money be put into a general administrative fund.
House passes bill blocking cities from banning natural gas - The state House of Representatives passed legislation last week that would block Ohio cities from limiting or banning residents from obtaining natural gas or propane services for their homes.All House Republicans and two Democrats voted in favor of House Bill 201, which would undercut potential efforts from cities taking a go-at-it alone approach to climate change when the state won’t act.No Ohio cities have undertaken any such effort, though some like Cleveland and Cincinnati have passed resolutions aimed at operating exclusively on renewable energy by 2025.The bill would prevent cities from enacting any law or building code that “limits, prohibits, or prevents” residential, commercial, or industrial consumers within their boundaries from obtaining natural gas service.Ohio is one of 23 states considering legislation to preempt cities from limiting new or existing gas hookups, a sweep of efforts backed by the natural gas industry. The state proposals follow a trend of progressive cities limiting gas distribution or incentivizing the electrification of buildings.The bill’s lead sponsor, Rep. Jason Stephens, R-Kitts Hill, described natural gas in a floor speech as an “affordable, reliable, and environmentally friendly” source of energy. The legislation, he said, would stave off attempts from Ohio cities following the lead of places like Berkeley or San Francisco which have adopted some form of a new natural gas ban. Democrats mostly sided with environmental advocates against the bill. Several pointed out that no city in Ohio is proposing any sort of ban on natural gas. Rep. Mary Lightbody, D-Westerville, said Ohio already gutted its clean energy portfolio mandates via House Bill 6 in 2019 (now the subject of a federal pay-for-play prosecution).
Thousands of abandoned Ohio oil and gas wells may be hidden. Drones could help find them - After successful trials using drones to discover abandoned oil and gas wells, Ohio authorities are looking to expand their use and to speed up remediation at hundreds of sites across the state.Ohio has roughly 1,000 sites on its orphan well inventory. There likely are “many more,” said Eric Vendel, chief of the Ohio Department of Natural Resources’ Division of Oil and Gas Resources Management. The hope is that drones equipped with magnetometers could help locate wells that are not yet on the state’s radar.Orphan wells matter because they can continue to emit methane, a health and fire risk if not properly contained. Methane also is 84 times more potent as a greenhouse gas than carbon dioxide is over a 20-year time span. Abandoned oil and gas wells have also contaminated soil and groundwater.Orphan wells in Ohio are a subset of the larger group of abandoned oil and gas wells, where no legally responsible owner can be found. Until wells are identified, however, it’s unclear whether they should be fixed by the state under its orphan well program.Until now, there haven’t been good tools to systematically identify which of the quarter-million wells drilled in the state since the mid-19th century have been properly plugged or should be deemed orphan wells. In many cases, wells have come onto Ohio’s orphan well list only after people reported problems. In one case, for example, a well was found under the gym floor at a Lorain County grade school. Nor has any systematic on-the-ground survey been done to check whether recorded wells were properly plugged.Magnetometers have been used to find wells and other geological anomalies for decades. The equipment looks for specific changes in the ground’s magnetic field that signal the presence of a vertical well casing. Walking sites with equipment is time-consuming, however, so it hasn’t been done in a systematic manner statewide. The growing popularity of remotely piloted aerial vehicles, or drones, within the last 20 years has paved the way for surveys to be done efficiently over larger areas. The magnetometer itself looks like a yard-long white surfboard. It hangs from a remote-controlled drone with a wingspan of 4 to 5 feet. “It’s a pretty big piece of equipment,” said Rob Lowe, a survey section manager at the Ohio Department of Natural Resources’s Division of Oil and Gas Resources Management. His section was formally established in 2016.Work by a team from the National Energy Technology Laboratory, ODNR and others confirmed the technology’s viability at last June’s Unconventional Resource Technology Conference. The team’s report showed that the drones found known wells and some that hadn’t been reflected in official records.
Ascent Resources Utica Holdings, LLC Reports First Quarter Operating And Financial Results --First Quarter Highlights:
- Averaged net production of approximately 1.8 bcfe per day for the quarter, of which 89% was natural gas
- Adjusted EBITDAX(1) of $240 million and net cash provided by operating activities of $210 million
- Decreased average well cost(2) to approximately $564 per lateral foot during the quarter, resulting in capital expenditures incurred of $148 million
- Generated $54 million of free cash flow(1) during the quarter
- Eliminated all debt maturities until Q2 2024 with the retirement of our Convertible Notes in March 2021 and the redemption of our Senior Notes due 2022 in April 2021
- Borrowing base reaffirmed at $1.85 billion in April 2021
- Reiterating annual production, free cash flow and capital guidance for 2021
Verde Bio Holdings, Inc. Announces Acquisition of Tri-Shale Portfolio of Mineral and Royalty Interest Verde Bio Holdings, a growing oil and gas Company, today announced that it has agreed to the purchase of a portfolio of mineral and royalty interests held by a private seller for a purchase price of $1,097,000 in cash. The interests to be acquired by Verde currently produces combined revenue of approximately $24,000 per month and Verde is entitled to the cash flow from production attributable to the acquisition beginning on or after May 1, 2021. The acquisition is expected to close on or before May 18, 2021.Acquisition Highlights:
- Oil rich Mineral Interest in Larimer County, Colorado operated by Petro Operating and Extraction Oil and Gas, who just announced a $2.6 Billion merger with dynamic DJ Basin pureplay operator, Bonanza Creek, to become Colorado’s first Net-Zero Oil and Gas Producer.
- 13 wells currently in production across the acquired acreage producing approximately $20,000 per month in revenue.
- Significant upside of expected, untapped revenue with two wells currently shut-in.Utica Shale producing Mineral Interest in Belmont and Monroe Counties in Eastern Ohio, operated by Gulfport Oil and Gas which has more than 205,000 net acres under lease in the Utica.
- Nine wells currently producing revenue of approximately $1500 per month with significant upside of three drilled uncompleted wells (DUC’s).
Coalition calling for pipeline scrutiny - Residents and members of some environmental groups near the path of the Falcon Pipeline are asking federal regulators for more answers and for more scrutiny of the Shell Pipeline project. The pipeline consists of two segments that both end at Shell’s facility in Monaca. One segment goes from the MarkWest facility in Cadiz, up to a facility in Scio and then through northern parts of Harrison and Jefferson counties. The pipeline crosses beneath the Ohio River and over to northern Hancock County before reaching its final destination. The second line goes from MarkWest’s Houston Plant in Washington County, Pa., and due north to Monaca. During Tuesday’s Zoom conference meeting, officials with the People Over Petro Coalition requested the federal agency in charge of oversight hold a public hearing to answer the group’s questions and to reconsider the permits already in place.Various members pointed out that in 2019, a whistleblower claimed there were defects in the pipeline construction and records were altered. “As residents, we need to be protected,” Heaven Sensky, a community organizer with the Center for Coalfield Justice who serves Washington and Greene counties in Southwestern Pa., said during the meeting. “We deserve to know that our government at all levels is working to keep us safe after they permitted this pipeline to come into our region.”Sensky went on to add that, “We need to know that Shell’s money and political influence won’t let them off the hook if they did something that puts us all in jeopardy. We need to know that the information they’re submitting is independently verified.” Others participating in the meeting included Tucker Harris, an Ohio landowner who said the pipeline runs 1,000 feet from his house. During a drilling operation, Harris said crews “blew out the end” of the pipeline. “Shortly thereafter, when we knew this was going on, I started getting a gray sludge in my well water,” Harris said. “I have water filters and we do have a well. I’ve actually saved my water filters and you pull the filters, it’s like a grey slime, which is what they actually use on the directional bores.”
ENERGY TRANSITIONS: 'Responsibly sourced' gas grows despite green washing claims -- Monday, May 10, 2021 -- Some of the biggest natural gas companies are moving to brand their product as low-emissions — a plan that could transform the industry even as it spurs accusations of green washing.
Country's 8th-largest natural gas producer to seek responsible certification - Pittsburgh Business Times - Another major Appalachian natural gas producer plans to seek environmental certification of its natural gas, joining other companies in the basin including EQT Corp., Chesapeake Energy and Southwestern Energy. Ascent Resources Utica Holdings LLC, the country’s eighth-biggest natural gas producer, made the announcement Thursday during its first-quarter earnings call with financial analysts. “We are working on several projects that will lead to certification of our Utica gas,” said Jeff Fisher, chairman and chief executive officer of the Oklahoma City, Oklahoma-based driller. It didn’t provide details. Ascent Resources is a privately held natural gas driller with assets in the Utica Shale, with about 340,000 net acres in southern Ohio. It produced 1.8 million cubic feet of natural gas, oil and natural gas liquids in the first quarter. It operated four drilling rigs and a hydraulic fracturing crew in the first quarter. Fisher said Ascent saw growing interest in the market for responsibly sourced natural gas, a designation that is being certified through third parties including MiQ and Equitable Origin and Project Canary. EQT and Chesapeake Energy are working through Project Canary, while EQT is also working with MiQ and Equitable Origin.\ Ascent also announced it had been invited to join the American Exploration & Production Council (AXPC), a trade association of independent oil and natural gas producers that is working to provide a voice on issues including methane reduction, corporate social responsibility and other issues. Other members include EQT, Cabot Oil & Gas Corp., Antero Resources Corp. and Encino Acquisition Partners. Fisher said that it had placed several of its executives in key committees at AXPC, which will provide what he called “a seat at the table” when it comes to issues of interest to the natural gas industry. Ascent has established a board committee on ESG issues and it plans to expand upon its current and new ESG initiatives later in the second quarter with its annual ESG report.
Pa. bill seeks to block towns from banning natural gas connections -Pennsylvania is joining a host of states in considering bills promoted by natural gas utilities that would prohibit local governments from restricting or banning utility hookups based on the type of energy they supply.The bill is part of a nationwide effort by the natural gas industry to prevent more towns from following the example of communities in California, Washington and Massachusetts that passed local ordinances to restrict new gas connections to buildings as a tool for combating climate change.There is no sign that any community in Pennsylvania is considering such a ban, officials representing Pennsylvania township, borough and city governments said at a hearing of the state Senate’s local government and environmental resources committees Tuesday.Both critics and supporters of the bill said municipalities are already prevented by other state laws from regulating utility service.But local government officials are concerned that the bill, Senate Bill 275, is so broad and ambiguous it could be read to limit local governments from using their existing power to incentivize energy efficiency upgrades, for example, or regulate outdoor wood-fired boilers.“In our reading of the bill, any local action in the form of programs, policies, regulations, codes or ordinances that favor and encourage one type of energy over another would be prohibited,” said Amy Sturges, director of governmental affairs for the Pennsylvania Municipal League.The exact impacts of the bill are unclear, in part, because it uses generic terms that make it appear that the bill’s language “was not crafted specifically for Pennsylvania,” said Joe Gerdes, director of government relations for the Pennsylvania State Association of Township Supervisors. Pennsylvania is one of about 20 states to introduce similar legislation.
Drilling group notes delays in DEP's reviewing key earthmoving permit - The wait time has expanded for a key permit for natural gas producers to begin work on drilling wells in the Pennsylvania Department of Environmental Protection southwestern region, which the Marcellus Shale Coalition says is making it difficult and more expensive for drillers to carry out their work. An analysis of permitting delays by the Marcellus Shale Coalition finds the two major DEP regional offices responsible for the majority of the oil and gas permits in Pennsylvania vary widely when it comes to the time it takes to review the erosion and sediment control general permit. The ESCGP, as it's called, doesn't involve drilling per se. It's more elemental to the process, the approval drillers need before they can start to push dirt around to build the roads, pads and other infrastructure. No ESCGP, no wells. The southwest regional office, based in Pittsburgh, took an average of 143 days to review 30 of the permits, up 22% in time while reviewing 55% fewer permits than in 2015, the analysis found. The southwest regional office handled 68 permits with an average review time of 117 days in 2015. The northcentral office in Williamsport, on the other hand, reviewed 124 permits in an average 84 days. That compared to 74 permits and an average 42 days to review in 2015. A third office, in Meadville and covering the northwest region, reviewed 10 permits in an average 98 days in 2020, compared to 23 permits in 93 days in 2015. "We've seen an erosion on how DEP is processing these general permits," said David Callahan, president of the Marcellus Shale Coalition. The general permits are designed to address stormwater runoff and prevent erosion, managing the changes to the land during the construction of well pads, roads to and from the pad, and pipeline rights of way. There are other permits that drillers have to get from the DEP but the ESCGPs start the process. Callahan said the coalition has raised concerns about how long it has taken to review these permits in the past and the DEP has taken steps to address them. But he said that the time has increased since then. "We need to be rather adept to react to pricing, and waiting longer and longer certainly has detrimental impacts," Callahan said.
Rep. Otten reintroduces pipeline early-warning proposal -— State Rep. Danielle Friel-Otten, D-155th, of Uwchlan, has reintroduced legislation that would place the costs of early detection and warning systems on pipeline operators rather than taxpayers and ensure that these systems are in place prior to pipeline operation. Pennsylvania law requires school districts, municipalities, and local emergency management agencies to implement disaster response and emergency preparedness plans consistent with guidelines developed by the Pennsylvania Emergency Management Agency.However, a recent ruling by the Pennsylvania Public Utility Commission found that pipeline operators have too often failed to provide any reliable means of monitoring pipelines for leaks or alerting communities of pipeline incidents, leaving local officials unable to fulfill their state-mandated emergency preparedness requirements. House Bill 1364, which Otten introduced as H.B. 1735 during the 2019-20 legislative session, seeks to address that failure by establishing a pipeline early detection and warning board. This board would collect fees from pipeline operators and distribute those funds to municipalities, school districts, or county governments for the development of early detection and warning systems to alert communities and emergency responders in the event of a pipeline incident. “For too long, Pennsylvania taxpayers and our local communities have borne all the risks and all the costs of pipeline operation,” Otten said. “My legislation properly places those costs on pipeline operators rather than taxpayers and helps to mitigate safety risks by ensuring that our municipalities, school districts, and emergency responders have the ability to develop emergency response plans and fulfill their statutory emergency preparedness requirements.”
Seneca Reports Big Jump in Natural Gas Production From New Pennsylvania Assets Seneca last July closed on a deal to acquire 450,000 net acres across the state including 350 producing Marcellus and Utica shale wells in Tioga County. Seneca, a subsidiary of National Fuel Gas Co. (NFG), said fiscal 2Q2021 production increased 43% year/year to 85.2 Bcfe.The bulk of the production gain came from the Eastern Development Area (EDA), which includes Tioga County. Net production increased by 21.2 Bcf year/year to 50.2 Bcf in the EDA, while volumes from Seneca’s Western Development Area in northwest Pennsylvania increased 4.6 Bcf to 31.3 Bcf over the same time. The company was most active on the western side of the state, however, bringing online 13 wells in the WDA during its second quarter. “Our operations team did a great job turning these recent wells online a few weeks ahead of schedule, allowing us to accelerate production during the winter months, capturing premium winter pricing,” said Seneca President Justin Loweth. He took over for John McGinnis, who retired earlier this month. Loweth said Seneca’s production would decline over the remainder of the fiscal year, which ends in September. The company drilled 14 new wells during the second quarter, but both NFG’s FM100 expansion project and Transcontinental Gas Pipe Line Co.’s Leidy South project are expected to come online by the end of the year. “As we approach the online date for Leidy South and the winter heating season, we expect to accelerate our completion operations, and we plan to delay turning in line most of these new wells until early fiscal 2022 coinciding with the expected in-service date of our new capacity,”
Are Fossil Fuels Impoverishing Middle America? - IEEE Spectrum - The African nation of Equatorial Guinea is rich in oil and gas reserves, yet poor in most other ways. It has over a billion barrels of proved crude oil and over a trillion cubic feet of proved natural gas reserves. On key measures, through—life expectancy, education, per-capita income—it ranks near the bottom of the world—144th out of 189 countries, according to a 2019 United Nations Development report. I said Equatorial Guinea is rich in oil and gas reserves, and poor in most other ways, but I could have said it’s poor in most other ways precisely because it’s rich in oil and gas. Its economy has grown rapidly, but almost entirely on the back of oil revenues that have funded a luxurious lifestyle for the nation’s political elite, while diseases like malaria still haunt the land. In fact, much of the country lacks access to clean water and healthcare. Only one of four babies is immunized against polio and life expectancy and infant mortality are not only low by world standards, they’re below average for sub-Saharan Africa. Equatorial Guinea is, it turns out, a prime example of what’s called the Resource Curse. The economy underperforms, in every other way, not just despite, but because of, this one natural resource. The country also has lots of arable land, and an abundance gold, uranium, and diamond deposits. But those have gone largely unexploited. There’s no need on the part of the elite to expand the economy beyond the windfall of oil and gas royalties, and no opportunity to do so by everyone else. I suppose it’s elitist and maybe even nationalistic of me, but imagine my surprise to hear the phrase “resource curse,” which I associate with the developing world, used recently in a webinar in the context of a region of the United States. The region is northern Appalachia, comprising 22 counties in eastern Ohio, western Pennsylvania, and northern West Virginia. And the curse is, as it so often is in the third world, a surfeit of oil and especially natural gas, in this case extractable largely through the relatively new process of fracking. Here to explain how the resource curse is impoverishing communities in the middle of the U.S. in the middle of the 21st century is Sean O’Leary. He’s a senior researcher at the Ohio River Valley Institute and the author of its recent report, “Appalachia’s Natural Gas Counties: How dreams of jobs and prosperity turned into almost nothing.”
NJ lawmakers ask Biden administration for new PennEast pipeline study – Two Central Jersey members of the House of Representatives have asked the Biden administration to revisit the environmental studies of the proposed PennEast pipeline.In a letter this week to President Joe Biden, Reps. Tom Malinowski, D-Hunterdon, and Bonnie Watson Coleman, D-Mercer, expressed "grave concern" over the $1 billion, 116-mile natural gas pipeline from Luzerne County, Pennsylvania, that would cross the Delaware River north of Milford, then parallel the river through western Hunterdon County before ending at Transco’s trans-continental pipeline near Pennington in Mercer County."For several years now, landowners in our New Jersey districts have been living in fear that their property will be taken or irreparably altered to make way for a pipeline that our state doesn’t want or economically need," the representatives wrote. "We have been meeting with constituents who live up and down the pipeline’s proposed route through western New Jersey and have seen firsthand the farms it would decimate, the waterways it would pollute, and the rural way of life it would destroy."The representatives told Biden that that the Federal Energy Regulatory Commission's approval of the pipeline is "a blatant example" of disregard for the National Environment Protection Act and environmental regulatory agencies. "The EPA gave PennEast’s Environmental Impact Statement a failing grade; citing significant concerns with the release of arsenic into the soil and groundwater, and noting unacceptable threats to 56 acres of wetland, and 633 acres of forest currently essential to the management of toxic runoff," the representatives wrote. "That failing grade should have been enough to halt PennEast’s certification process until those environmental impacts had been addressed."
Proposed Natural Gas Plant In Peabody On Hold, For Now - The Massachusetts Municipal Wholesale Electric Company (MMWEC) paused plans to build a natural gas power plant in Peabody to address concerns raised by local residents and advocacy groups.In a statement released Tuesday, the company called 30-day pause "an unusual step," noting that the project has been in development and open to public review for more than three years, and has already secured permits from the state.Get the news Boston is talking about sent to your inbox every weekday morning.Sign up now.Company CEO Ron DeCurzio, calling MMWEC "a proven leader in carbon-free technology," said in the statement that technology has changed since the project — officially known as 2015A — was first proposed more than five years ago, necessitating a pause and design review.The announcement comes after 87 Massachusetts health care professionals, many from the North Shore, released a letter opposing the plant on Monday, expressing concern over air pollution and climate change."The air pollution associated with the new plant will increase mortality within the Peabody community," said the letter. It also says the project, by expanding natural gas infrastructure in the state, is "antithetical" to the commonwealth's new climate law.
‘Your Invisible Friend’: Parents outraged by pro-gas booklets made by Eversource used in Mass. school – (AP) — The father of a Cambridge, Massachusetts, elementary school student said Monday he was shocked when he pulled two activity booklets from his son’s backpack that had been distributed at his school, including one titled: “Natural Gas: Your Invisible Friend.” Both were published by the energy utility Eversource and paint a rosy picture of the fossil fuel. An inside page of one of the booklets declares “Natural Gas Is Great,” and encourages students to connect speakers like a popcorn plant manager and a bus rider to statements like “it’s a safe, clean, efficient fuel to use in our plant,” and “I like the fact that while I commute to work I am using a natural gas vehicle that reduces harmful air pollutants.” Both booklets carry the Eversource logo on their covers and also include natural gas safety tips, like keeping paper towels away from gas stoves. Gleb Bahmutov, a 41-year-old software engineer, said he was disturbed to learn that the booklets in his nine-year-old son’s backpack had been distributed to him and other students attending the Tobin Elementary School. Bahmutov said he was not only surprised the school was giving out material from a company, but was angered that the booklet painted natural gas in such glowing terms with no mention of the wider impact of fossil fuels on the climate or of the option of renewable forms of energy. “Eversource is not a company that should be publishing activity books,” Bahmutov said. “It sounds like propaganda and I was born in the Soviet Union, so I don’t use that term lightly.”
Living Near Fracking Wells Is Linked to Higher Rate of Heart Attacks, Study Finds - Living among fracking wells is linked to higher rates of hospitalizations and deaths due to heart attacks, according to a new study.The study, published in the Journal of Environmental Research, compared heart attack rates in Pennsylvania counties with fracking to demographically similar counties in New York where fracking is banned."There's a large body of literature linking air pollution with poor cardiovascular health and heart attacks, but this is really the first study to look at this from a population level related to fracking," Elaine Hill, a researcher at the University of Rochester Medical Center and one of the study's co-authors, told EHN.Hill and her colleagues looked at hospitalization and mortality records in 47 counties in New York and Pennsylvania from 2005-2014 (the most recent data available at the time the study was initiated) and found that heart attack hospitalization rates were higher on the Pennsylvania side of the border by 1.4–2.8 percent, depending on the average age and density of fracking wells in a given county. Living near a higher density of wells translated to a greater risk of heart attacks.They also found that middle-aged men living on the Pennsylvania side of the border were 5.4 percent more likely to die of a heart attack than their counterparts in New York. The authors speculate that this link may be stronger in middle-aged men because they're more likely to work in the industry and have higher levels of exposure as a result.The researchers were not able to control for lifestyle factors like smoking and drinking due to a lack of data, but they did assess demographics at the county-level to ensure they were looking at communities with similar economic and racial makeups on both sides of the border. They analyzed different age groups separately across the counties, and also adjusted for coal production in each county (another factor that can increase heart attack risk) and for rates of access to health insurance, which may influence whether people go to the hospital when having a heart attack.While numerous studies have compared economic differences between the two states, this is the first to use this "natural experiment" to compare human health outcomes on both sides of the border. A 2020 study conducted by veterinarians similarly found that horses raised near fracking wells on the Pennsylvania side of the border had higher rates of a rare birth defect than horses raised by the same farmer on the New York side.Fracking and the increased truck traffic created by the industry raise levels of air pollution significantly, and exposure to air pollution raises heart attack risk. Living near fracking wells is also linked to heightened stress levels, which is another contributor to cardiovascular disease.Alina Denham, the study's lead author, said their findings are in line with previous research. She pointed to a2019 paper that found higher levels of physical markers associated with heart attack risk in people who live near fracking. Still she said, "Additional research is needed to figure out exactly how exposure to fracking wells leads to increased heart attack risk."
Marathon Refinery Near Ashland Exceeds EPA Levels For Cancer-Causing Pollutant – 89.3 WFPL News Louisville - A Marathon oil refinery in eastern Kentucky is one of 13 refineries across the country that released harmful levels of a cancer-causing pollutant, according to a report from the nonprofit Environmental Integrity Project.Fence line readings for benzene jumped 233% between 2019 and 2020 at the Catlettsburg Marathon refinery near Ashland, and were 11% above action levels designated by the U.S. Environmental Protection Agency.Benzene is a common pollutant found in oil and a known human carcinogen. The increase in benzene levels at the Catlettsburg Marathon refinery is likely the result of two leaks from March and October, said Eric Schaeffer, Environmental Integrity Project executive director. “When you get concentrations that high, you really need to get in gear and get on top of it and try and fix it,” Shaeffer said. Communities living near the fence lines of heavy industry bear a disproportionate pollution burden compared to those who live farther away. Nearly 12,000 people live within 3 miles of the Catlettsburg refinery, 44.6% of whom live in poverty, according to theEIP report. The Catlettsburg refinery was one of two Marathon refineries included in the report. The other was a refinery in Port Arthur, Texas. A Marathon spokesman said the releases were the result of “one-time events” that have since been addressed. The EPA measures air pollution at the fence lines of oil refineries under the Clean Air Act. The benzene levels were measured under the 2015 Clean Air Act rule, which requires refineries to investigate and clean up sources of benzene emissions when air monitoring shows annual concentrations exceeding EPA action levels of 9 micrograms per year.
Private land taken for a pipeline: At what price? --For the first time since a natural gas pipeline used its power of eminent domain to take private property three years ago, a jury is being asked to determine a fair price.A trial began Tuesday to decide just compensation for James and Kathy Chandler, whose 111-acre rural property and custom-built home atop Bent Mountain will be bisected by the Mountain Valley Pipeline.U.S. District Judge Elizabeth Dillon ruled in 2018 that Mountain Valley had a right to begin construction on 8.6 acres of the land — over the objections of the Chandlers, who see it as a nightmare to their dream home.“You’ll see the ugly scar the pipeline is cutting across the Chandler property, and how it is forever altering their use of the property,” Stephen Clarke, an attorney for the Chandlers, told the jury.When Dillon granted Mountain Valley immediate possession of an easement through the land, it was part of a giant case that involved about 300 properties in Southwest Virginia that the 303-mile pipeline needed to pass through.Since then, each landowner has had a separate proceeding to determine how much they should be paid by the Pittsburgh-based joint venture of five companies building the pipeline.Many of the cases have been settled, either through voluntary agreements struck between landowners and Mountain Valley or after a judge’s ruling on evidentiary issues forced a resolution. About a dozen cases remain open, according to court records.Although a key part of the opposition to Mountain Valley has been the way it took private land for its own profit, that will not be in question during the trial. Under the Natural Gas Act, the power of eminent domain was a given once it was established that the pipeline would serve a public good. Rather, the jury will be asked to determine a fair market value of a landowner’s loss — putting a highly emotional issue largely in the hands of appraisers.In his opening arguments, Clarke did not delve into the numbers. Instead, he told the jury about how the Chandlers had long dreamed of moving to the Bent Mountain community in Roanoke County. They found the perfect piece of land and decided to build a luxury home that “would look old but feel new,” Clarke said. Parts from a historic barn and a log cabin were used as furnishings, and the Chandlers hauled rocks from their mountain land to construct beautiful stone fireplaces.When it was done, “they knew they could come home and be at peace,” Clarke said.Then, about seven years ago, Mountain Valley announced plans for a buried pipeline that would transport natural gas at high pressure from northern West Virginia to Pittsylvania County, where another pipeline would take it to markets in the Mid-Atlantic and Southeastern regions of the country. “It cuts through the heart of their property,” Clarke said. “For the last three years, they’ve lived next to a construction zone.”
U.S. natgas futures ease on milder weather forecast (Reuters) - U.S. natural gas futures eased on Monday on forecasts for milder weather and lower heating demand next week than previously expected. Traders also noted prices were down with a small increase in output and a small decline in exports. Front-month gas futures NGc1 fell 2.6 cents, or 0.9%, to settle at $2.932 per million British thermal units. But with cooler weather expected this week, speculators last week boosted their net long gas futures and options positions on the New York Mercantile and Intercontinental Exchanges to their highest since early March. Data provider Refinitiv said gas output in the Lower 48 U.S. states averaged 91.0 billion cubic feet per day (bcfd) so far in May, up from 90.6 bcfd in April, but well below November 2019's monthly record of 95.4 bcfd. Refinitiv projected average gas demand, including exports, would fall from 88.0 bcfd this week to 82.7 bcfd next week as the weather turns seasonally warmer. That forecast for next week was lower than Refinitiv estimated on Friday. The amount of gas flowing to U.S. LNG export plants averaged 11.4 bcfd so far in May, down from April's monthly record of 11.5 bcfd. Buyers around the world continue to purchase near-record amounts of U.S. gas because prices in Europe and Asia remain high enough to justify the cost of buying and transporting the U.S. fuel across the ocean.
June Natural Gas Futures Reverse Course, Climb with Exports Steady, Cyberattack Resolution in View --Natural gas futures on Tuesday bounced back from the prior session’s losses, as export demand and other key fundamentals held strong, while a critical oil pipeline signaled it could restore operations this week following a ransomware attack.The June Nymex contract advanced 2.3 cents day/day and settled at $2.955/MMBtu. July gained 2.1 cents to $2.999.Each had declined 2.6 cents on Monday amid worries about the cybersecurity breach involving Colonial Pipeline Co. The company operates a key delivery system spanning from the Gulf Coast to the East Coast for transportation fuels and other refined petroleum products.Cash prices on Tuesday ticked lower. NGI’s Spot Gas National Avg. declined 2.0 cents to $2.725.Liquefied natural gas (LNG) levels again topped 11 Bcf on Tuesday. Feed gas volumes have held above the 11 Bcf and near record levels for eight consecutive days as European and Asian demand for U.S. exports of the super-chilled fuel are holding strong.EBW Analytics Group estimated that LNG feed gas demand has averaged 2.2 Bcf/d higher year-to-date when compared with the same period in 2020, “with comparisons only projected to grow further into mid-summer.”
Rosy LNG Outlook Helps June Natural Gas Futures Extend Gains -- Natural gas futures advanced for a second straight day on Wednesday as production dipped and all indications pointed to continued strong demand for U.S. liquefied natural gas (LNG). The June Nymex contract settled at $2.969/MMBtu, up 1.4 cents day/day. July rose 1.9 cents to $3.018. NGI’s Spot Gas National Avg., however, declined 2.0 cents to $2.705 amid waning weather-driven demand. While always subject to revisions, production estimates at the start of trading Wednesday hovered around 89 Bcf, roughly 1 Bcf below recent averages and well below pre-pandemic levels. At the same time, LNG feed gas volumes hung near 11 Bcf, far above year-earlier levels. Both Asian and European demand for U.S. exports of the super-chilled fuel is expected to hold strong through the summer cooling season. European gas storage was depleted over a freezing winter and chilly spring, driving demand and higher prices for U.S. LNG. Elevated needs in Europe are boosting prices – and near-term demand – in Asia as well, as traders pay up to attract shipments, according to analysts. U.S. LNG export terminals “are running at their operationally available and contracted levels and will continue to do so, with no economically driven cargo cancellations anywhere on the horizon,” RBN Energy LLC analyst Lindsay Schneider said Wednesday. “Global gas prices are well supported by low storage levels in Europe, and it will take time to refill inventories, which means these high prices are not going away anytime soon.
US EIA reclassifies gas in South Central region resulting in 71 Bcf storage injection | S&P Global Platts --US natural gas storage volumes expanded by 71 Bcf, or 1 Bcf more than an S&P Global Platts' survey expected, as 4 Bcf of working gas stocks in the South Central region were reclassified to base gas. Storage inventories increased to 2.029 Tcf for the week ended May 7, the US Energy Information Administration reported May 13. The build measured less than the five-year average of 82 Bcf and the 104 Bcf addition reported in 2020. Storage volumes now stand 378 Bcf, or 15.7%, less than the year-ago level of 2.407 Tcf and 72 Bcf, or 3.4%, less than the five-year average of 2.101 Tcf. The South Central region is driving the largest portion of the mounting deficit, with stocks 197 Bcf lower year over year. This is due in part to substantial demand growth that has accrued in the area. Total demand for the week ended May 7 averaged 8 Bcf/d higher than a year earlier, according to S&P Global Platts Analytics. Much of the growth stems from higher feedgas deliveries to Gulf Coast LNG facilities and stronger exports to Mexico. The NYMEX Henry Hub June contract was static at $2.97/MMBtu in trading on May 13. The balance-of-summer averaged $3.01/MMBtu, or 14 cents below the upcoming winter strip, November through March. Platts Analytics' supply and demand model currently forecasts a 55 Bcf injection for the week ending May 14, which would measure 31 Bcf less than the five-year average. Residential and commercial loads are up by roughly 3 Bcf/d week over week. The spike in home heating demand was softened somewhat by a 1.9 Bcf/d drop in power burn demand. Overall, total demand is up 1.3 Bcf/d week over week, averaging 87.1 Bcf/d. Upstream, supplies have been notably flat, with the largest change coming from a 200 MMcf/d increase in net Canadian imports to meet rising res-comm demand, followed by a 100 MMcf/d increase in onshore production, bringing total supplies up by about 400 MMcf/d on the week to an average 95.1 Bcf/d. Lower US gas yields have tightened supply just as Mexico and LNG exports have been rising resulting in tighter balances and increased gas-to-coal switching. With stocks heading into summer on the low side the outlook looks bullish especially if the weather turns hot. However, Platts Analytics believes the current forward curve is a little overdone and production will grow at these prices as wind and solar will increasingly offset gas-fired power demand.
U.S. natgas eases from 11-week high as exports decline (Reuters) - U.S. natural gas futures slipped on Friday from an 11-week high in the prior session as exports declined and production edged up, as well as on forecasts for mild weather and lower demand next week. Traders noted that price decline came even though the weather was expected to warm up in two weeks, which should prompt power generators to burn more gas as homes and businesses crank up their air conditioners. Front-month gas futures NGc1 fell 1.2 cents, or 0.4%, to settle at $2.961 per million British thermal units. On Thursday, the contract closed at its highest since Feb. 19 for a second day in a row. Despite the small daily decline, the contract gained less than 1% during the week, putting it up for a fifth week in a row for the first time since October 2020. Data provider Refinitiv said gas output in the Lower 48 U.S. states averaged 90.8 billion cubic feet per day (bcfd) so far in May, up from 90.6 bcfd in April, but still well below November 2019's monthly record of 95.4 bcfd. Refinitiv projected average gas demand, including exports, would fall from 87.2 bcfd this week to 80.8 bcfd next week as the weather turns milder before rising to 85.4 bcfd in two weeks with the start of air conditioning season. The amount of gas flowing to U.S. LNG export plants averaged 11.1 bcfd so far in May, down from April's monthly record of 11.5 bcfd. That's because U.S. LNG feedgas was on track to hold near 10.1 bcfd for a third day in a row on Friday, its lowest since early March when the plants were recovering from the February freeze in Texas, according to preliminary data from Refinitiv. The decline was due to reductions at Cameron in Louisiana and Corpus Christi in Texas.
Largest U.S. fuel pipeline remains mostly closed days after cyberattack with no timeline for reopening -Colonial Pipeline is working to restore service and has some smaller lateral lines between terminals and delivery points operating again, the company announced Sunday afternoon. The company, the operator of the country's largest fuel pipeline, temporarily suspended all operations due to a ransomware attack on Friday. Its four mainlines remain offline. Colonial said it's developing a restart plan, but provided no timetable as to when full service will be restored. "We are in the process of restoring service to other laterals and will bring our full system back online only when we believe it is safe to do so, and in full compliance with the approval of all federal regulations," Colonial said in a statement. The federal government is working to avoid supply disruptions after the company suspended operations, U.S. Commerce Secretary Gina Raimondo said Sunday morning. "This is what businesses now have to worry about," Raimondo said during an interview on CBS' "Face the Nation." "Unfortunately, these sorts of attacks are becoming more frequent. They're here to stay." President Joe Biden has been briefed on the ransomware attack and the F.B.I. said it's working closely with Colonial Pipeline and government partners to address the situation. The Department of Energy is leading the federal response, according to Colonial. The Department of Homeland Security's Cybersecurity and Infrastructure Security Agency is coordinating with the company. Colonial said it learned Friday that it "was the victim of a cybersecurity attack" and has since shut down 5,500 miles of pipeline that carry nearly half of the fuel supplies on the East Coast, raising fears of spot shortages of gasoline, diesel and jet fuel. The pipeline is the largest refined products pipeline in the nation, according to Colonial. "It's an all hands on decks effort right now," Raimondo said. "We're working closely with the company, state and local officials to make sure that they get back up to normal operations as quickly as possible and there aren't disruptions to supply."
US Declares State Of Emergency To Keep Gasoline Flowing After Colonial Fails To Restart Hacked Pipeline --Just in case the US didn't already have a "transitory hyperinflation" problem, gasoline futures soared more than 4% - and are likely to jump much more - late on Sunday after the Colonial Pipeline announced that while some smaller lateral lines between terminals and delivery points are now operational, its mainlines (Lines 1, 2, 3 and 4) remain offline since late Friday after the company suffered a crippling cyberattack that affected its key IT systems. Colonial operates Line 1 for gasoline and Line 2 for diesel and jet fuel from Pasadena, Texas, some 15 miles from the nation’s largest refineries, to Greensboro, North Carolina, at a combined 2.5 million barrels a day. They merge at Greensboro to feed a line carrying about 900,000 barrels a day into New York Harbor, and other East Coast pipelines. Colonial said that it is "in the process of restoring service to other laterals and will bring our full system back online only when we believe it is safe to do so, and in full compliance with the approval of all federal regulations." Full statement below: Meanwhile, downstream customers, which includes pretty much the entire Eastern seaboard, are starting to freak out as they face a new week without the primary source of gasoline supply for hundreds of millions of customers. Update 9:00pm ET: The US government declared a state of emergency late on Sunday, lifting limits on the transport of fuels by road in a bid to keep gas supply lines open as fears of shortages spiked after the continued shutdown of the Colonial Pipeline. “This Declaration addresses the emergency conditions creating a need for immediate transportation of gasoline, diesel, jet fuel, and other refined petroleum products and provides necessary relief,” the Department of Transportation said. White House Press Sec Jen Psaki added that "as the Administration works to mitigate potential disruptions to supply as a result of the Colonial Pipeline incident, @USDOT is taking action today to allow flexibility for truckers in 17 states." The move lifted limits on the transport of fuels by road to ease the fallout from the continuing closure of the Colonial pipeline, which carries almost half the fuel consumed on the US East Coast, following a ransomware cyber attack on Friday. The decision comes as the government scrambles to deal with the fallout from the closure of Colonial, the biggest refined products pipeline in the US, transporting 2.5m barrels of fuel a day from refineries on the Gulf Coast to markets such as Atlanta, Washington and New York (see more below). If the pipeline is not quickly reopened the impact on prices could become more severe in the coming days, said Patrick De Haan, head of petroleum analysis at data provider GasBuddy. “We’re realizing the gravity of it is maybe worse than what we’d expected,” said De Haan. “There’s still a little breathing room, we’re starting to run low on it. But Monday, Tuesday if there’s no news, you know we’re dealing with something fairly significant.”
US Scrambles to Transport Gasoline After Colonial Pipeline Hack - In an attempt to stave off a potential gasoline shortage and price spike on the East Coast, the Biden administration has issued an order allowing some truck drivers transporting gasoline to work overtime. The move follows the shutdown of one of the nation’s most crucial pipelines after it was hit by one of the biggest cyberattacks against oil and gas infrastructure in U.S. history.On Friday, the owners of Colonial Pipeline announced that the company was victim to a ransomware attack, and that it had temporarily halted all operations as it worked to secure its IT system in response. While some of the smaller lines have since come back online, as of Monday, the pipeline’s main arteries remained shut down for an indeterminate amount of time.The Department of Transportation declared a state of emergency in response to the shutdown in 17 states and the District of Columbia, waiving certain requirements for motor carriers and drivers who are working to address the shutdown. They can now drive beyond the normal 11-hour-per-day limit. That’s an attempt to help stave off fuel shortages given that the Colonial pipeline network provides around 45% of the gasoline used in the region.Despite the catastrophes that pipeline spills can pose to public health and the environment (look no further than the 1.2-million-gallon-plus spill the Colonial pipeline unleashed in August in North Carolina, as well as explosions along the main line in Alabama that killed one worker and injured several others in 2016), freight transport of oil and gas is a much riskier prospect. Trucks and trains are some of the least safe ways to transport oil and gasoline, and, accordingly, account for only a small percentage of the petroleum products moved around the country each year. Road and rail transport are also much more expensive than pipeline transport. If the shutdown keeps more tankers on the road ferrying gasoline, that could alsocontribute to a rise in prices at the pump. Just keeping drivers on the road longer—especially given the fact that the trucking industry said a few weeks ago that it’s lacking qualified tanker drivers to meet demand in normal times—isn’t enough of a solution to the looming shortage. The East Coast has access to fuel supplies imported from Europe, but those are more expensive than domestic sources. The region also can tap into some hundreds of thousands of barrels of oil in storage, but those supplies would be “little more than a Band-Aid” in an extended shutdown, ClearView Energy Partners, a research firm, said in a statement to clients. And while the U.S. has access to foreign-flagged vessels it could tap to help transport fuel to the East Coast, it would require that the president waive the Jones Act, a 100-year-old law that requires only U.S.-produced boats and barges be used to transport goods between domestic ports.
Gasoline futures turn lower following earlier surge due to pipeline cyberattack - Futures for fuel prices turned lower after jumping to their highest levels in nearly three years overnight. The pullback came even as much of one of the largest pipelines in the U.S. remains closed following a cybersecurity attack.The owner, Colonial Pipeline, said Sunday evening that some of its smaller lateral lines between terminals and delivery points are once again online, so traders may be reassessing the risk of a longer shutdown that would boost prices.Gasoline futures gave up most of their gain and fell into the red, retreating by 0.2% to $2.122 per gallon. At one point in the overnight session, gasoline futures jumped as high as $2.216, levels not seen since May 2018.Colonial, which operates the largest pipeline carrying fuel from the Gulf Coast to the Northeast, "halted all pipeline operations" on Friday night as a proactive measure following the ransomware cyberattack. A criminal group known as Dark Side may be responsible for the attack, NBC News reported, citing two sources familiar with the matter.While tank farms typically have a few days of stored fuel supply, a prolonged outage could lead to a spike in fuel prices. Analysts say a shutdown beyond five days could translate to higher prices.On Monday, Cybereason provided CNBC with a new statement from DarkSide's website that appears to address the Colonial Pipeline shutdown. DarkSide said it's an apolitical organization and only wants to make money without causing problems for society.In an attempt to maintain fuel supplies along the Eastern Seaboard, the U.S. declared a state of emergency in 17 states and the District of Columbia on Sunday evening.
East Coast motorists finding offline fuel pumps. -- Gas stations along the U.S. East Coast are starting to run out of fuel as North America’s biggest petroleum pipeline fights to recover from a cyberattack that has paralyzed it for days. From Virginia to Florida and Alabama, fuel stations are reporting that they’ve sold out of gasoline as supplies in the region dwindle and panic buying sets in. The White House said it was aware of shortages in the Southeast of the country and was trying to alleviate the problem. Four days into the crisis, Colonial Pipeline Co. has only managed to manually operate a small segment of the pipeline -- as a stopgap measure -- and doesn’t expect to be able to substantially restore service before the weekend. The risk is that by that point drivers or airlines may already be suffering severe fuel shortages, while refineries on the Gulf coast could be forced to idle operations because they have nowhere to put their product. U.S. average retail gasoline prices have risen to their highest since late 2014 due to the disruption, almost touching $3 per gallon. That could add to broader inflationary pressures as commodity prices from timber to copper also surge. The Colonial pipeline is the most important conduit to distribute gasoline, diesel and jet-fuel in the U.S., moving the products from the refiners based on the Gulf coast into urban areas from Atlanta to New York and beyond. Each day, it ships about 2.5 million barrels -- more than the entire oil consumption of Germany -- connecting more than 20 refineries with about 200 distribution centers. The vital conduit has been shut down since late Friday. Without the Colonial pipeline, many cities and airports must seek alternative supplies, either fuel imported by tanker or, if landlocked, relying on trucks. In the first sign of the potential disruption to air travel, American Airlines Group Inc. said it was adjusting two long-haul routes that originate in Charlotte, North Caroline, to add fuel stops. Flights to Hawaii will call in at Dallas-Forth Worth airport, while London-bound aircraft will make a stop in Boston. Airlines flying out of Philadelphia International Airport are burning through jet-fuel reserves and the airport has enough to last “a couple of weeks,’ a spokeswoman said. The U.S. East Coast is losing around 1.2 million barrels a day of gasoline supply due to the disruption.
EPA, DOT move to boost gasoline availability after Colonial Pipeline cyberattack - The Environmental Protection Agency and the Department of Transportation announced separate actions Tuesday to make more gasoline available for sale on the East Coast, in hopes of averting fuel shortages as the Colonial Pipeline remains almost entirely shuttered by last week's cyberattack.The steps included an EPA fuel waiver issued Tuesday morning allowing retailers in D.C. and parts of Pennsylvania, Maryland and Virginia to sell dirtier-burning gasoline than ozone pollution regulations would normally allow. It expanded the waiver Tuesday night to add all or part of nine additional states, including Alabama, Delaware, Georgia, the Carolinas and Florida.Separately, DOT said it is considering a "temporary and targeted" waiver of the Jones Act, a much-debated law that forbids foreign-owned, operated or built ships from carrying goods between U.S. ports. That waiver would also be aimed at helping fuel supplies get where they're needed.States including Virginia have also issued emergency declarations allowing their own agencies to waive rules to ease fuel backlogs.The moves came as the Biden administration made repeated assurances that it is trying to forestall fuel shortages, while warning that some may occur anyway."These states who are impacted, even with the turning on of the pipeline system, they still may feel a supply crunch as Colonial fully resumes," Energy Secretary Jennifer Granholm said during a briefing with reporters. "But the American people can feel assured that this administration is working with the company to get it resumed as soon as possible."EPA's action: The Energy Department agreed with the agency's waiver, EPA Administrator Michael Regan wrote Tuesday, calling the cyberattack an "extreme and unusual" occurrence "that could not reasonably have been foreseen and is not attributable to a lack of prudent planning on the part of suppliers of the fuel to these areas."
U.S. pipeline outage spurs refiners to book tankers to store fuel - (Reuters) -Refiners booked at least five tankers to store gasoline stranded at U.S. Gulf Coast plants following a cyberattack that crippled the biggest fuel pipeline in the country, according to sources and shipping data on Tuesday. The attack on the Colonial pipeline network, which supplies half of the fuel consumed along the East Coast, has forced Gulf Coast refineries to scale back operations due to lack of storage space. North Carolina suspended restrictions on fuel shipments to combat gasoline shortages. The tankers, booked by Marathon Petroleum, Valero Energy, Phillips 66 and PBF Energy, can hold around 350,000 tonnes of fuel. Two of them were booked for up to a month, and three were provisional bookings that could be cancelled, according to data and shipbroking sources. Colonial on Friday shut its 5,500-mile (8,850-km) pipeline network, which moves fuels including gasoline, diesel and jet fuel, to protect its systems. It has restarted some smaller lines. In the wake of the outage, traders also booked several tankers to ship gasoline and diesel from Europe to the U.S. East Coast. French oil major Total SE and commodities trading houses Vitol and Trafigura each booked 90,000-tonne tankers to ship diesel on the transatlantic route, shipping data showed, a relatively rare route as Europe consumes more diesel than it produces. Several Gulf Coast refiners that rely on Colonial for shipments have cut output. Total and Motiva Enterprises cut gasoline production at their Port Arthur, Texas refineries and Citgo Petroleum pared back at its Lake Charles, Louisiana, plant, sources told Reuters.
In the Colonial Pipeline Mess, Tanker Trucks Come to the Rescue -ON WEDNESDAY NIGHT, the Colonial Pipeline Company, which operates the country’s largest pipeline system for refined oil, reported that the 5,500-mile system was finally up and running again, with service slated to return to normal by week’s end. It had been four days since the pipeline went down in a historic—and frightening—ransomware attack. And yet, as of Thursday morning, cars continued to snake around gas stations up and down the Eastern seaboard, waiting their turn to fill up at the tank. Turns out that if you tell people something is threatening their petroleum supply, they will freak out and buy a lot of it. The National Association of Convenience Stores reported Wednesday that stations are doing two to four times their usual business, with some retailers clearing several days’ worth of gas—around 16,000 gallons per station—in a few hours. It’s the kind of purchasing behavior the industry usually sees around hurricanes, says Jeff Lenard, the association’s vice president of strategic industry initiatives. The panic buying has spilled into areas that don’t even get their gas from the Colonial Pipeline: On Wednesday, the association reported elevated sales as far south as Naples, Florida, a region that gets its gasoline off of cargo ships. The pipeline shutdown did lead to some supply issues, industry executives say. But many of the gas shortages at retail locations are happening because petroleum is simply in the wrong place. Mostly unable to use the pipeline the past few days, the oil and gas industry has turned to other modes of transportation: rail, vessels, and, most of all, tanker trucks. A lot of tanker trucks. Usually, tanker trucks are the last element of oil’s long journey from refinery to fuel tank. Ships, rail lines, and pipelines do the bulk of the work, delivering gas to distribution terminals scattered around the country. Trucks finish up the journey, from distribution terminal to one of the country’s 150,000 gas stations. Because of the pipeline slowdown and the uptick in demand everywhere, truckers are now having to make faster turnarounds and sometimes longer trips—as much as an extra 80 to 180 miles each time, according to Ryan Streblow, the interim president of National Tank Truck Carriers, an industry group.
The hackers behind the Colonial Pipeline cyberattack said they didn't mean to cause problems and will 'introduce moderation' in future targets - The group accused of carrying out the Colonial Pipeline cyberattackhas said it never intended to cause disruption to society, and would approach targets differently in the future. A ransomware group compromised the pipeline on Friday and demanded money in exchange for its release. The pipeline was shut down by its operators as a result.The pipeline network, which runs from Texas to New York, is one of the country's largest, transporting about 45% of the East Coast's fuel, the operator said.The FBI said on Monday that DarkSide ransomware was responsible for the hack. DarkSide appeared to claim responsibility for the hack, saying in a Monday statement its goal was not to cause disruption, and that it would approach targets differently in the future."Our goal is to make money and not creating problems for society," the group said in a statement. "From today, we introduce moderation and check each company that our partners want to encrypt to avoid social consequences in the future."
Colonial aims to 'substantially' restore pipeline operations by end of week --The Colonial Pipeline Company said that it hopes to “substantially” restore the operations of its pipeline by the end of the week following a ransomware attack that led to its shutdown. It said in a statement that segments of the Colonial Pipeline, which transports oil from Texas to the East Coast, are being “brought back online in a stepwise fashion” and that its plan will take a “phased approach” for returns to service. “This plan is based on a number of factors with safety and compliance driving our operational decisions, and the goal of substantially restoring operational service by the end of the week,” the statement said, noting that the company will provide updates on its progress. The company also said that the federal government’s moves to exempt motor carriers and drivers from hours limitations is expected to “help alleviate local supply disruptions.” Colonial announced over the weekend that it would shut down the 5,500 mile-pipeline after a ransomware attack breached its IT system. It did so to prevent the attackers from accessing its operational technology. The pipeline supplies about 45 percent of the East Coast’s fuel supply. Analysts told The Hill on Monday that the impacts of the shutdown would depend on how long the pipeline’s main segment remains offline.
Colonial Pipeline starts limited shipments amid fears of fuel shortages - The Colonial Pipeline resumed limited shipments on Monday, delivering fuel from North Carolina to a terminal in Maryland, in the first stage of what still could be a slow restarting of the main pipeline from Houston's refineries to the East Coast after a cyberattack forced its shutdown last week. The announcement fell far short of a return to service for Colonial's entire 5,500-mile line, which supplies 45 percent of gasoline, diesel and jet fuel to the East Coast is back in operation. And even if the pipeline resumes service by the weekend, as Colonial promised Monday, that may not be enough to prevent fuel shortages in parts of the country. The White House said late Monday that it was actively prepping for possible disruptions. "We are monitoring supply shortages in parts of the Southeast and are evaluating every action the Administration can take to mitigate the impact as much as possible," press secretary Jen Psaki said in a statement. Colonial shut the pipeline on Friday after the company's corporate computer systems were hit by a ransonware attack, raising fears of a spike in gasoline prices going into the peak summer driving season. News earlier Monday that the pipeline company was planning a phased restart helped tamp down an early jump in wholesale prices, but the attack on the crucial energy infrastructure has left energy markets on edge. The company late Monday statement did not disclose what type of fuel Colonial is shipping in the stretch of pipe that runs from Greensboro, N.C., to Maryland, but it said the main lines from the refining hub near Houston to North Carolina remained shut.
Colonial announces pipeline restart, says normal service will take 'several days' -- Colonial Pipeline, operator of the largest U.S. fuel pipeline, said Wednesday it is restarting operations after being shut down for five days due to a cyberattack.The company shut down its entire operation Friday after its financial computer networks were infected by a Russia-tied hacker gang known as DarkSide, fearing that the hackers could spread to its industrial operations as well.The shutdown led to widespread gasoline shortages and caused temporary price spikes. The U.S. saw the problem as serious enough to issue an emergency order that relaxed restrictions for drivers carrying fuel in affected states."Colonial Pipeline initiated the restart of pipeline operations today at approximately 5 p.m. ET," the company said in a statement on its website. "Following this restart, it will take several days for the product delivery supply chain to return to normal." Jennifer Granholm, the U.S. energy secretary, tweeted that she had spoken to Colonial's CEO about the restart. The company hired Mandiant, an Alexandria, Virginia, cybersecurity firm, to deal with the incident.
Spot gas shortages could worsen if Colonial Pipeline doesn’t reopen by the weekend --If the Colonial Pipeline is not back in business by the weekend, prices could continue to rise at the pump and there will be broader localized fuel shortages across the southeast and mid-Atlantic regions. Gasoline stations that could not get enough fuel were already closed in some states, and prices jumped overnight, by as much as 10 cents or more per gallon in some areas. "This turns into a crisis by the end of the week, if it's not resolved, particularly with Memorial Day coming," . "People are going to start topping off their tanks." It's not that there's not enough fuel. There's plenty in the refining centers on the Gulf Coast. The issue is that gasoline, jet fuel and diesel are stuck in the wrong places. Moving it requires a hodgepodge of solutions, and analysts say it will be impossible to meet demand without the pipeline. Colonial Pipeline stopped operations Friday and notified federal officials that it was the victim of a ransomware attack. The attack, carried out by a criminal cyber crime group known as DarkSide, resulted in the shutdown of 5,500 miles of pipeline. The artery supplies half of the gasoline to the east coast and runs from Texas to New Jersey. The pipeline company said it expects to restore a substantial amount of operations by the end of the week, but how much is not clear. U.S. Energy Secretary Jennifer Granholm said federal agencies are working around-the-clock to help the pipeline return to normal operations. The shutdown arrives at an inopportune time: The beginning of what could be a record summer driving season as Americans make up for last year. "Given the size and the direction of the pipeline and the market that it feeds, the Colonial Pipeline is the single most important artery moving refined products in the country," "This is already an earthquake and the magnitude of the earthquake just grows by the day."
Colonial Pipeline paid $5 million ransom to hackers -- Colonial Pipeline paid a ransom to hackers after the company fell victim to a sweeping cyberattack, one source familiar with the situation confirmed to CNBC. A U.S. official, who spoke on the condition of anonymity, confirmed to NBC News that Colonial paid nearly $5 million as a ransom to the cybercriminals. It was not immediately clear when the transaction took place. Colonial Pipeline did not immediately respond to CNBC's request for comment. The ransom payment was first reported by Bloomberg. Earlier on Thursday, President Joe Biden declined to comment when asked if Colonial Pipeline paid the ransom. White House press secretary Jen Pskai told reporters during a briefing that it remains the position of the federal government to not pay ransoms as it may incentivize cybercriminals to launch more attacks. Last week's assault, carried out by a criminal cybergroup known as DarkSide, forced the company to shut down approximately 5,500 miles of pipeline, leading to a disruption of nearly half of the East Coast fuel supply and causing gasoline shortages in the Southeast. Ransomware attacks involve malware that encrypts files on a device or network that results in the system becoming inoperable. Criminals behind these types of cyberattacks typically demand a ransom in exchange for the release of data. On Monday, White House national security officials described the assault as financially motivated in nature but would not say if Colonial Pipeline agreed to pay the ransom. "Typically that's a private sector decision," Anne Neuberger, deputy national security advisor for cyber and emerging technologies, told reporters at the White House when asked about the ransom payment. Deputy National Security Advisor for Cyber & Emerging Technologies Anne Neuberg speaks about the Colonial Pipeline outage following a cyber attack during the daily press briefing at the White House in "We recognize that victims of cyberattacks often face a very difficult situation and they have to just balance often the cost-benefit when they have no choice with regards to paying a ransom. Colonial is a private company and we'll defer information regarding their decision on paying a ransom to them," Neuberger said. She added that the FBI has previously warned victims of ransomware attacks that paying a ransom could encourage further malicious activity.
Colonial Pipeline restarts after hack, but supply chain won't return to normal for a few days --Colonial Pipeline restarted operations Wednesday at approximately 5 p.m. ET after a ransomware attack last week forced the entire system offline on Friday evening. The company did warn, however, that its pipeline would not be fully functional immediately. "Following this restart it will take several days for the product delivery supply chain to return to normal," Colonial said in a statement. "Some markets served by Colonial Pipeline may experience, or continue to experience, intermittent service interruptions during the start-up period. Colonial will move as much gasoline, diesel, and jet fuel as is safely possible and will continue to do so until markets return to normal," the company added. Most of the pipeline, which is the largest fuel transmission line from the Gulf Coast to the Northeast, has been offline since Friday. The company shut down its systems as a proactive measure after it fell victim to a ransomware attack by a criminal group known as DarkSide. The pipeline is a critical part of U.S. petroleum infrastructure, transporting around 2.5 million barrels per day of gasoline, diesel fuel, heating oil and jet fuel. The pipeline stretches 5,500 miles and carries nearly half of the East Coast's fuel supply. The system also provides jet fuel for airports, including in Atlanta and Baltimore. Given the importance of the pipeline, there was swift action from Washington, in what officials called a "comprehensive federal response." The Department of Energy led the federal government response in coordination with the FBI, Department of Homeland Security and Department of Defense. Energy Secretary Jennifer Granholm previously said that the company would make a restart decision by the end of the day on Wednesday. "So far there is no evidence from our intelligence people that Russia is involved although there is evidence that the actor's ransomware is in Russia. They have some responsibility to deal with this," Biden said from the White House on Monday. Officials warned that gas supplies remained at reasonable levels, but panicked consumers headed to the pump as the pipeline shutdown stretched on for days. As of Wednesday afternoon 68% of gas stations in North Carolina were out of gas, according to data from GasBuddy. In South Carolina and Georgia 45% of stations were dry, while 49% of stations across Virginia reported outages.
John Kerry Believes Pipelines Are More Efficient, Contradicting the Biden Admin -- John Kerry, the U.S. Special Presidential Envoy for Climate, contradicted the Biden administration Wednesday by admitting pipelines are a more efficient way of transporting fuel than train or truck after the administration has revoked pipeline permits, including Keystone XL.During an appearance in front of the House Foreign Affairs Committee on Thursday, Kerry said pipelines are better than the alternates. This is after President Joe Biden canceled the permits for the Keystone XL pipeline earlier this year.Republican Rep. Darrell Issa (CA) posed the question, Kerry, “Isn’t it true the pipelines are more carbon-delivery efficient than trains or trucks or other forms of delivery if you could answer just that limited question.”“Yeah, that is true,” he immediately responded.Kerry continued, “I think that is true, but it doesn’t mean necessarily want to be adding another line when there are other alternatives.” “But is it better than train, is it better than that, yes, it is,” he added.
Goodrich Ramping Haynesville Natural Gas Production on High Prices, Productive Wells - Goodrich Petroleum Corp. plans to ramp up natural gas production in the resurgent Haynesville Shale this year, citing strong commodity pricing and high productivity from recently completed wells in northwestern Louisiana. “The core of the Haynesville continues to offer low development and lifting costs, top-tier cash margins and returns on invested capital, as well as the ability for us to both grow and deliver free cash flow at current commodity prices,” CEO Gil Goodrich said Thursday during an earnings call to discuss first quarter results. He added that “numerous new well additions late in the first quarter and subsequent to the end of the quarter have us very well-positioned to deliver strong results in the second quarter.” The company expects production to average 150,000-160,000 Mcfe/d during the second quarter, and is maintaining full-year guidance of 160,000 Mcfe/d at the midpoint, up 20% year/year. Guidance was revised downward slightly due to the impacts of Winter Storm Uri in February and curtailment of nonoperated volumes. The company expects to fetch a 15-25 cent premium to Henry Hub prices for its production. Management is forecasting $15-30 million of free cash flow for the year, assuming natural gas prices of $2.50-3.00/Mcf. If current strip pricing is an indicator, “we’re obviously going to be at the high range of that free cash flow guidance range, and then we’re doing our best to control our operating cost,” said COO Rob Turnham. Production averaged about 125,000 Mcfe/d for the first quarter, of which 98% was natural gas. This compares to 137,000 Mcfe/d, also 98% natural gas, in the year-ago period. Oil and natural gas revenues totaled $31.9 million, up from $23 million in 1Q2020. Goodrich reported average realized natural gas prices of $2.72/Mcf and $57.88/bbl for oil, up from $1.73/Mcf and $47.64/bbl a year ago.
3 arrested in Bayou Bridge protest can challenge trespass law -- Monday, May 10, 2021 -- Protesters from New Orleans and Mississippi and a journalist from New York arrested during a protest against pipeline construction may continue their challenge of a Louisiana law carrying a possible five-year prison sentence for anyone convicted of trespassing in the area of a pipeline, a federal judge has ruled.
Oil from abandoned Louisiana wells would be exempt from tax under House-passed bill The Louisiana House of Representatives has unanimously passed a bill to exempt oil production from abandoned wells from severance tax Tuesday. Rep. Jean-Paul Coussan, R-Lafayette described House Bill 662 as a win-win for the industry and the environment, but environment advocate Cynthia Sarthou, executive director of Healthy Gulf, called it a “real gift to the oil industry.”The Department of Natural Resources has designated more than 4,000 oil wells in the state as orphaned or abandoned. Wells typically become abandoned when a small oil company buys a previously drilled well and goes bankrupt without properly plugging and abandoning it. When this happens, the liability falls to the state, which uses revenue from a fee on oil and gas production to pay for the cleanup. But the program lacks adequate funding, according to a 2014 legislative auditor's report.Coussan’s bill would incentivize new oil producers to take over the liability of the well by eliminating the severance tax on oil production, which is typically 12.5%. The tax exemption would last for two years or until production of the well surpasses the cost of operation, whichever comes first.
Enbridge Sees 'Renewed Interest' in US Gulf Crude, LNG Exports as Pandemic Fears Fade --Canadian pipeline giant Enbridge Inc. said Friday it was seeing an uptick in interest for crude and liquefied natural gas (LNG) exports from the U.S. Gulf Coast amid an anticipated global economic recovery from the Covid-19 pandemic. “Our solid regional footprint and premier North American integrated pipeline networks are ideally positioned to capitalize on these opportunities and we continue to advance several export pipeline and crude oil terminal opportunities,” President Al Monaco said in the Calgary firm’s first quarter earnings report. Enbridge is developing the Cameron Extension Project to transport feed gas to Venture Global LNG Inc.’s under-construction Calcasieu Pass LNGterminal in Louisiana. It also plans to build a feed gas pipeline to the NextDecade Inc.’s proposed Rio Grande export site in South Texas. On the oil side, the company has partnered with Enterprise Products Partners LP to build a deepwater crude oil export terminal off the Texas coast.Enbridge also shared the latest developments on its closely watched Line 5 project. Designs are complete and a construction contractor is being recruited for the disputed plan to save the 540,000 b/d Line 5 with a new $500 million tunnel under the Straits of Mackinac, Monaco said. Ebridge’s natural gas business segment reported volumes of 671 Bcf on its systems in the first quarter, compared to 638 Bcf in the same period one year ago. On the oil side, the company reported volumes of 2.75 million bbl on its Mainline system compared to 2.84 million bbl in 4Q2020. It also reported first quarter volumes of 1.95 million bbl on its Regional Oil Sands System compared to 1.87 million bbl in the same period one year ago.
Governor Edwards and Senator Cassidy request end on oil and gas lease ban -— As the moratorium on offshore oil and gas leases lingers, Governor John Bel Edwards is calling on President Biden to lift the ban by summer. Governor Edwards wants the Biden administration to know a prolonged drilling halt would be devastating to Louisiana’s economy. Edwards testified before the U.S. Senate Committee on Energy and Natural Resourses. He’s calling on Biden to take a balanced approach to climate change and oil and gas exploration. On Capitol Hill, Edwards joined forces with republican U.S. Senator Bill Cassidy. Both are concerned about the President’s pause on oil and gas leases. “Federal oil and gas production must continue in the Gulf and well into the future,” Edwards said. Cassidy said, “Solutions are needed which move us in the right direction.” In February, President Biden signed an executive order stopping new permits on federal lands and federal waters. He wants to reach net-zero greenhouse gas emissions by 2050. Governor Edwards said, “We are committed to addressing climate change responsibly and to an orderly energy transition. Environmentally responsible oil and gas production must be allowed to continue on the outer continental shelf in the Gulf of Mexico.” According to Edwards, revenue from offshore drilling helps fund climate change goals. “The goal of net-zero carbon emissions by 2050 is an ambitious goal, but it is what the global scientific community says is necessary if we want to avoid the most severe impacts from climate change,” said Edwards. Senator Cassidy said, “The current posture of the Biden administration threatens our longterm ability to fund these projects while putting tens of thousands of jobs at risk.”
Winter storm crisis: Texas natural gas industry opposes new oversight --Advocates for the Texas natural gas industry have spent much of the 11 weeks since February’s deadly power blackouts downplaying the sector’s culpability in the crisis and working to stop lawmakers from requiring winterization of far-flung wells and pipelines. But new data suggest failures by natural gas producers and suppliers to keep the commodity flowing might have triggered as much as a fifth of the freeze-related power outages near the peak of the calamity. What's not up for debate is that statewide production of natural gas — a major source of fuel for electricity generation — slumped dramatically amid the historic winter freeze and prices for it soared. Production fell by nearly half at one point during the emergency, compared with levels earlier in February, according to IHS Markit, a company that aggregates information about the energy sector. Natural gas spot prices climbed from an average of about $2.80 per million British thermal units at the main West Texas trading hub to a high of $206.19 — a 73-fold increase. At least 151 people, including 12 in Travis County and three in Williamson County, died statewide for reasons related to the frigid temperatures and others lost limbs to frostbite, as many power plants faltered just when needed most. Property damage from the power outages has been estimated at over $200 billion, while water service to more than 12 million people across the state also was disrupted because pipes froze and burst. Proponents of the state's natural gas industry — in addition to its regulator, the Texas Railroad Commission — have largely deflected blame for the overall crisis, saying freeze-related outages at power plants exacerbated issues at natural gas production and supply facilities because they rely heavily on electricity to operate and to resolve their own weather-induced problems.
TEXAS: Gas lobbying raises fears of another blackout crisis -- Wednesday, May 12, 2021 -- Texas' powerful fossil fuel industry is lobbying to exempt parts of the natural gas system from legislation aimed at preventing a repeat of blackouts that left millions of people in the cold and dark in February.
Apache Nabs $4-Plus for Permian Natural Gas, Boosted by Prescient Hedging Strategy - -- After fetching $4.61/Mcf for its Permian Basin natural gas in the first quarter, APA Corp. is stepping up its activity in some prospects and extending its exploration in Texas, executives said Thursday.The gassy Alpine High development in the Permian Delaware sub-basin of West Texas had been the Houston-based explorer’s No. 1 global play. As gas prices stagnated and oil prices strengthened, more capital was moved to Egypt, the North Sea and offshore Suriname. Still, with prices on the rise early this year, CEO John Christmann IV had said in February the Alpine High and other U.S. prospects were likely to see more love in 2021. “We made excellent progress during the first quarter with regard to our top priority of free cash flow generation and net debt reduction,” Christmann said during the quarterly conference call Thursday.“We performed well relative to our production expectations,” with “good capital and cost discipline,” even with the “challenging weather events” during February’s deep freeze.The challenging weather, however, proved a boon for Apache, which in March became an APA subsidiary. What happened was fortuitous, as the marketing team revamped the gas hedging strategy at the end of January, which led to a $147 million gain. APA’s exposure to the gas spot market was increased, as marketing entered into financial contracts that boosted exposure for the month of February to daily gas pricing, while reducing exposure to first-of-month pricing. Spot electricity and gas prices in Texas then hit record highs in February on the extreme weather.CFO Stephen Riney during the conference call explained that all of the Permian gas production is sold “and then we manage our long-haul transport obligations separately. We optimize those obligations through the purchase, transport and sale of gas from various receipt points in the Permian Basin and in the Gulf Coast areas. “Our common practice, as we contract for the purchase and sale of gas, is to maintain a relatively balanced exposure between gas daily and first-of-month pricing. As the end of January approached, we had a portfolio of purchase-and-sales contracts that were heavily skewed to February first-of-month pricing. As we commonly do, when this is the case, we use financial contracts to rebalance that exposure closer to 50-50.”
Oil cuts likely to remain for years --Even though oil companies are recovering from their worst downturn in decades, they are unlikely to restore exploration and production budgets to pre-pandemic levels for years, according to a new report.Oil producers are expected to spend about $390 billion on exploration and production activities this year, a slight increase from the $382 billion in spending last year, according to Rystad. The Norwegian energy research firm forecasts upstream investment will rise gradually to just over $480 billion by 2025, less than the pre-pandemic level of $530 billion.The tightening of company purse strings will have widespread implications for Houston’s economy and the more than 60,000 oil exploration and production workers in Texas who were laid off during the downturn. Lower capital spending will mean fewer jobs in the oil patch.“Rystad Energy expects the effect of the pandemic to be a lasting one. Even though spending will start growing from 2022, it will not return to the pre-pandemic level of $530 billion,” Rystad said in a report released Wednesday. “Growth will be limited and investments will only inch up annually.”Crude prices, which plummeted last year, have recovered quickly in recent months. Oil rose 1 percent Wednesday to settle at $66.08 a barrel, lifted in part by report by the International Energy Agency. The IEA found that supply glut that has plagued the industry for more than a year, has come to an end.Still, Rystad said, it’s unlikely spending on new wells will recover to pre-pandemic levels. Oil companies are keeping their focus on paying down debt and boosting shareholder returns to woo investors back to the energy sector. Energy was the worst-performing sector of the U.S. stock market in 2020 after years of lackluster performance.When crude prices crashed as the pandemic broke out last spring, oil companies swiftly slashed $285 billion collectively from their exploration and production budgets, representing more than half of their spending in 2019, according to Rystad. U.S. shale companies made the deepest spending cuts, shedding $96 billion from their exploration and production budgets, Rystad said. “Since shale oil is both the segment with the highest decline in activity,” said Espen Erlingsen, Rystad’s head of upstream research, “and the supply source in greatest need of continuous reinvestment to keep production growing, the immediate impact (of spending cuts) on output from this sector has been significant.”
Rare Plants Under Review In Oil And Gas Fight - The U.S. Fish and Wildlife Service will take a closer look at two rare plants found only in northwestern New Mexico to see if they warrant protection under the federal Endangered Species Act as environmentalists push to stop oil and gas development in the region.The agency's decision to review the Aztec gilia and Clover's cactus came Tuesday, after being petitioned by environmentalists nearly a year ago. Environmentalists point to the fishhook-spined cactus and the flowering herb as more reasons development should be limited in the San Juan Basin. They say federal land managers aren't doing enough to preserve the plants."The Bureau of Land Management has been rubber stamping fracking in this region for decades, running roughshod over the greater Chaco landscape and communities," Rebecca Sobel with the group WildEarth Guardians said in a statement. "If unfettered fracking is not reined in, the health of the landscape and these endemic species remains in grave peril."The fight over drilling in the San Juan Basin has spanned multiple presidential administrations and both sides of the political aisle. Environmental groups began by raising concerns about the potential for increased pollution across the region and some Native American tribes joined the fight, calling for a permanent moratorium that would prohibit development in more areas beyond the boundaries of Chaco Culture National Historical Park.Legislation that would establish a buffer on federal land surrounding the park is pending in Congress. Groups also have been pressuring Interior Secretary Deb Haaland, a former New Mexico congresswoman and the first Native American to head a cabinet department, to take executive action. In their petitions, environmentalists cited public records that show disagreement within the Bureau of Land Management and failures by oil and gas companies to comply with conditions of their permits when it came to dealing with the plants. They also cited poor record-keeping related to efforts to transplant Clover's cactus and their survival rates. The cactus is found only in Rio Arriba, Sandoval and San Juan counties in grasslands and among desert shrubs. The petition states that the effects of oil and gas development are mostly associated with the creation of well pads and the networks of pipelines and roads that connect them.Other threats include horse and cattle grazing, illegal harvesting, seed collection, off-road vehicle use and climate change. Predation by rabbits, moths and beetles also have contributed to the plants' demise.
As Line 5 debate continues, residents weigh risks to shorelines, economies - — In six days, oil escaping from under the Straits of Mackinac could reach Rogers City. There, it could hurt wildlife, sicken residents, and coat beaches with slime, according to experts studying the possible effect of an oil spill from Line 5, Enbridge Inc.’s 68-year-old pipeline carrying crude oil across the bottom of the Straits. Such a spill presents relatively low risk of devastating environmental impact in Alpena and Thunder Bay, according to studies. Neighbors to the northwest, in Presque Isle County, face a more realistic possibility of long-term hurt if oil escaped the pipeline. Though insisting the pipeline is safe, Enbridge plans to relocate Line 5 into a concrete tunnel 100 feet below the lakebed through the Straits as part of a plan worked out with previous Gov. Rick Snyder. Lawsuits by the Michigan Legislature and the Michigan Attorney General dispute Enbridge’s right to run oil through those waters. Current Gov. Gretchen Whitmer in November ordered Enbridge to stop transporting oil through the Straits and gave the company six months to comply. Enbridge’s deadline is Wednesday. Environmental groups claim the pipeline’s location and age put lakes Michigan and Huron, which connect at the Straits, and coastline communities at risk of a disastrous oil spill, endangering the environment, local and state economies, and human health. Enbridge maintains that shutting down the line would remove a vital fuel supply to Michiganders and hurt the state’s economy. Both arguments are true, said David Schwab, a researcher who conducted hundreds of tests to determine possible outcomes of an oil spill from the pipeline. Schwab, a Great Lakes oceanographer employed by the University of Michigan Water Center, with expertise in the currents through the Straits, created computer simulations of 860 scenarios of potential weather and lake conditions at the moment of an oil spill from Line 5. Currents almost as strong as those in the Detroit River can run either direction through the Straits and change from day to day, according to Schwab. Given the unpredictability of currents and the wide variety of weather systems in northern Michigan, the Straits present the worst point in the Great Lakes for an oil spill, Schwab said. If 25,000 gallons leaked from the pipeline, Schwab’s tests showed about a 5% chance enough oil would make it to Thunder Bay to noticeably impact residents or the environment. The spilled oil would arrive about 10 days after the spill.
Michigan tribes plan peaceful gatherings for Enbridge ‘eviction day,’ LaDuke to speak --Tribal citizens and environmental groups in Michigan are preparing for “Enbridge eviction” celebrations this week in honor of Gov. Gretchen Whitmer’s Wednesday deadline for the Canadian oil company to shut down its controversial Line 5 pipeline. At the same time, Enbridge allies are gearing up for the deadline by arguing the 68-year-old pipeline has a positive economic impact. The nonprofit Consumers Energy Alliance — a front group for the energy industry that pushes pro-oil and gas messaging in the United States, according to SourceWatch — released a report Monday arguing that a Line 5 shutdown would devastate energy supplies of surrounding states. The two days of planned events near the Mackinac Straits on Wednesday and Thursday are being organized by Indigenous water protection group MackinawOde, Great Lakes Water Protector Group and the Oil & Water Don’t Mix coalition. Nathan Wright, a citizen of the Sault Ste. Marie Tribe of Chippewa Indians and a core member of MackinawOde, says the two days are meant to honor Indigenous peoples’ connection with the water while continuing to protest Enbridge’s presence in the Straits. In November, Whitmer set a deadline of May 12 for Enbridge to cease operation of the pipeline while ordering the company’s 1953 easement with the state to be revoked and terminated. Michigan and Enbridge are currently entangled in several court disputes regarding the shutdown order, and a final ruling is unlikely to happen before Wednesday. Although the order will still take effect Wednesday, a court order will be needed to enforce the shutdown as Enbridge has said it will not comply voluntarily. Winona LaDuke is slated for the keynote speaker role. She is the director of Indigenous environmental group Honor the Earth, a vocal activist against oil pipelines, including Enbridge’s Line 3 in Minnesota, and a former Green Party vice presidential candidate.
On eve of Line 5 shutdown deadline, Enbridge vows to defy Michigan order --Enbridge Energy technically has one more day to shut down the Line 5 pipeline in the Straits of Mackinac, but even the pipeline’s most vocal opponents acknowledge slim odds that the oil actually stops flowing right away. In the six months since Governor Gretchen Whitmer gave Enbridge 180 days to stop transporting petroleum across the tempestuous waterway that links Lakes Michigan and Huron, and the four months since Enbridge vowed to defy her, state officials have been adamant that the order still stands. But as for what Michigan can or will do if Enbridge keeps the oil flowing beyond midnight on Wednesday? That’s unclear. Spokespeople for the governor declined to answer questions about their plans, but supplied a written statement noting that Whitmer “stands behind her decision” to cancel the easement that first gave Enbridge’s predecessor permission to build a pipeline along the sandy bottom of the straits 68 years ago. “We cannot risk the devastating economic, environmental, and public health impacts of a catastrophic oil spill in the Great Lakes,” the statement reads. Michigan Attorney General Dana Nessel, who is locked in legal battle with Enbridge over the shutdown order, said her office expects to pursue “punitive measures'' if Enbridge defies the order. But first, the state and Enbridge must settle a dispute about whether the case will be heard in state or federal court. Enbridge officials admit that the idea of constructing a pipeline in the open waters of the Straits would not fly today. But company officials also insist that the current pipeline is safe: constructed of material thicker than most pipelines and watched closely for any sign of malfunction. And, Enbridge contends, pipeline regulation is a task for the federal Pipeline and Hazardous Materials Safety Administration, not the state of Michigan. “We will not stop operating the pipeline unless we’re ordered by a court or our regulator, which we think is highly unlikely,”
Enbridge Pipeline Day of Reckoning? Indigenous Rights Groups Join Michigan Gov. Whitmer in Demanding Shutdown --Indigenous rights and climate action groups are set to hold an "Evict Enbridge" celebration on Wednesday and Thursday to mark Michigan Gov. Gretchen Whitmer's deadline for Canadian oil and gas company Enbridge to shut down its Line 5 pipeline.Ahead of Wednesday's deadline, which Whitmer set last November, the Democratic governor called Enbridge's continued use of the Straits of Mackinac — under which Line 5 has carried more than half of Ontario's oil supply since 1953 — a "ticking time bomb.""Their continued presence violates the public trust and poses a grave threat to Michigan's environment and economy," Whitmer said in a statement this week.Whitmer, who campaigned on shutting down Line 5, announced last November that she was revoking an easement granted by the state of Michigan nearly 70 years ago, saying Enbridge has violated safety requirements.Although no oil or gas leaks from Line 5 — which carries 540,000 barrels of oil per day — have been reported, the pipeline has been struck by boat anchors and other equipment in recent years. Last year, the line was shut down temporarily after an anchor support sustained damage.Whitmer said last year that Enbridge violated a rule prohibiting unsupported gaps beneath the pipeline, and another pipeline run by the company spilled more than 845,000 gallons of oil in 2010, affecting the Kalamazoo River.According to a 2017 National Wildlife Federation report, more than two dozen spills from other sections of Enbridge's pipelines exceeded one million gallons.A 2018 poll of Michigan residents found that 54% of the state wants Line 5 shut down and 87% are concerned about the pipeline spilling into the Straits of Mackinac.At the Evict Enbridge event in Mackinaw City this week, environmental justice advocate Winona LaDuke will be among the speakers. "Will Enbridge shut [Line 5] down or will the public do it for them?" said Honor the Earth, LaDuke's organization, on social media Monday. Enbridge has "imposed on the people of Michigan an unacceptable risk of a catastrophic oil spill in the Great Lakes that could devastate our economy and way of life," Whitmer said when announcing the easement, which was granted despite the fact that the federal government generally regulates oil pipelines.Michigan Attorney General Dana Nessel denounced the company and the Canadian government for putting the state "in a position where Canada stands to gain nearly all the benefit and the state of Michigan bears all the risks."
Canada warns Michigan oil line shutdown could undermine U.S. ties (Reuters) -A day before Michigan's deadline to close down a key crude oil pipeline, Canada on Tuesday issued its strongest remarks so far about the move, warning that it could undermine relations with the United States, its closest ally and trading partner. Canadian company Enbridge Inc is preparing for a legal battle with Michigan and courting protests from environmental groups, betting it can ignore the state's Wednesday deadline to shut down Line 5, which runs under the Straits of Mackinac. The Canadian government, intervening in the case to back Enbridge, said in a U.S. federal court filing that Michigan had no right to act unilaterally since a 1977 Canada-U.S. pipeline treaty guarantees the free flow of oil between the two nations. "This case raises concerns regarding the efficacy of the historic framework upon which the U.S.-Canada relationship has been successfully managed for generations," Ottawa said. Michigan's move "threatens to undermine important aspects of that cooperative international relationship", it added. The brief said Canada would suffer "massive and potentially permanent disruption" from a shutdown. Line 5 brings 540,000 barrels-per-day of oil from western Canada to Ontario, Quebec, Michigan, Ohio and Indiana. Canada has been lobbying https://www.reuters.com/business/energy/frustrated-canada-presses-white-house-keep-great-lakes-oil-pipeline-open-2021-04-26 Washington officials to keep the pipeline open in what is likely to be an election year in Canada. The White House has so far kept quiet. "We don't weigh in on that ... it will be decided in court," U.S. Secretary of Energy Jennifer Granholm told reporters on Tuesday when asked about the White House's position on Line 5. The government of Alberta, Canada's main crude-producing province, welcomed the federal government's intervention. Energy Minister Sonya Savage said Michigan's attempt to shut down an operating pipeline set a dangerous precedent for future oil and gas projects.
Whitmer threatens Enbridge as workers protest Line 5 closure deadline — While the state's Democratic attorney general is saying she can't close Line 5 without a court order, Michigan's Democratic governor is insisting Enbridge will be considered a trespasser if it continues to operate the oil pipeline in the Straits of Mackinac after Wednesday. Gov. Gretchen Whitmer warned an Enbridge executive Tuesday that if the Canadian company continued to operate in the Straits past Wednesday, the state would seek its profits if it eventually prevails in its legal fight to revoke the pipeline's easement. Continued operations would be considered "an intentional trespass," she said. The company, Whitmer said, "will be liable for unjust enrichment, which will require disgorgement to the state of all profits derived from its wrongful use of the state's property." "The state intends to assert claims for trespass and unjust enrichment against Enbridge at the appropriate time when the pending motion for remand in the state’s lawsuit has been decided," Whitmer wrote in the letter to Vern Yu, Enbridge's executive vice president. The National Wildlife Federation on Tuesday applauded Whitmer's ultimatum, noting Enbridge could be forced potentially to give up 100% of its daily Line 5 profits — an amount the group estimated to be about $1.4 million a day. Enbridge said in a Tuesday statement it is confident the state and the company would eventually reach a resolution. "A shutdown of Line 5 has serious, broad ramifications and raises substantial federal and international questions relating to interstate and international commerce," Enbridge spokesman Ryan Duffy said. "That is why the case is in federal court where the judge has ordered mediation." Whitmer's letter came a day after Attorney General Dana Nessel's office told The Detroit News that she had no way to enforce the easement revocation and closure order without court intervention. "The jurisdictional issue will not be decided until sometime after May 12," Nessel spokeswoman Lynsey Mukomel said. "We need a court order that requires Enbridge to shut down in compliance with the notice. We will continue to work to get that as soon as possible."
"Water is life" is the theme of Day 1 of protests to shut down Enbridge Line 5 -On Thursday, environmental groups and Native Americans plan to present Enbridge Energy with symbolic eviction notices. They want Enbridge to abide by Governor Gretchen Whitmer’s order to shut down Line 5 in the Straits of Mackinac. In November 2020, Governor Whitmer revoked the easement for Enbridge Energy’s Line 5 twin pipelines through the Straits of Mackinac, and gave the company 180 days to shut down that section of the pipelines, which carry light crude oil and natural gas liquids. That deadline was Wednesday at midnight, and Enbridge says it has no intention of shutting the line down. On Tuesday, Governor Whitmer pledged to try and seize any profits the company makes from the pipeline after that deadline, claiming trespass on state property.. In the background, the question of whether Whitmer’s November revocation notice was legal is playing out in the courts. Michigan Attorney General Dana Nessel sued in circuit court to enforce the order, and Enbridge counter-sued in federal court. The two sides are now in court-ordered mediation over whether the legal dispute over the easement will be heard in state or federal court. Wednesday was the first day of Line 5 protests in Mackinaw City. There's a two-lane road separating Enbridge Energy’s big Line 5 pumping station from a little park where a lot of tribal members from all over the upper Midwest gathered. There were also some non-indigenous activists from the Lower Peninsula of Michigan with them to keep public pressure on the Canadian pipeline company. There was a lot of music, some ceremonies, and many people taking turns with the microphone, reminding each other how precious the Great Lakes – and particularly the Straits of Mackinac – are to the tribes.
Enbridge continues Line 5 Straits pipeline operation, defies Whitmer - In defiance of an order by Gov. Gretchen Whitmer to cease operations by Wednesday, Canadian oil transport giant Enbridge continued to flow 23 million gallons of crude oil and natural gas liquids through Line 5, its controversial, 68-year-old twin pipelines on the Straits of Mackinac lake bottom. Whitmer on Tuesday, in a letter to Vern Yu, Enbridge’s executive vice president for liquids pipelines, said continued operation of the line after Wednesday “constitutes an intentional trespass” and that the company would do so “at its own risk.”“If the state prevails in the underlying litigation, Enbridge will face the prospect of having to disgorge to the state all profits it derives from its wrongful use of the easement lands following that date,” she said. Whitmer in November moved to revoke Enbridge's 1953 easement to situate the pipelines on state-controlled bottomlands near where Great Lakes Michigan and Huron connect, citing repeated violations of the easement's terms on pipeline safety measures and an unreasonable risk to the Great Lakes from the aging pipes' continued operation. The governor gave Enbridge 180 days to arrange for shutdown of the pipes, a deadline that ends Wednesday. Hardhats cover a portion of the Capitol lawn in protest of a Line 5 closure on Tuesday, May 11, 2021, in Lansing. The hats represented jobs that would be lost. (Photo: Nick King/Lansing State Journal)But Enbridge is continuing to operate Line 5, saying Whitmer's order amounts to attempting to regulate interstate pipeline safety, which the company believes is the sole jurisdiction of the federal government.As of Wednesday, Enbridge's continued operation of Line 5 in the Straits is "unlawful," Whitmer Press Secretary Bobby Leddy said.The battle over Line 5 is playing out in both state and federal courts, and in the court of public opinion. Enbridge, with allies including many Republicans in the state Legislature, business and industry groups and labor unions for refinery workers, says a Line 5 shutdown would devastate Michigan's and the region's energy supply and economy — and the company has spread that message far and wide across television, the web and print in an expensive media blitz.
Michigan, Ohio, Wisconsin business leaders urge court to keep Line 5 operating -- The Canadian and U.S. chambers of commerce joined forces with their counterparts in Ohio, Michigan and Wisconsin by filing a joint brief in court to argue against Gov. Gretchen Whitmer’s bid to shut down the cross-border pipeline. Wednesday marked Whitmer’s original deadline for Enbridge to shut down Line 5, which she maintains poses an unacceptable environmental risk along the bottom of the Straits of Mackinac, which connect Lake Huron with Lake Michigan. “The tunnel solution essentially eliminates the risk of an oil spill at the Straits of Mackinac,” the chambers argue in their filing, known in legal parlance as an amicus brief. The existing tunnel agreement with Michigan gives Enbridge the right to cancel the project entirely if the pipeline is forced to cease operations, even temporarily, they argue. “Under the termination clause of two agreements… if defendants comply with the state of Michigan order and involuntarily shut down the pipeline, then defendants can choose to terminate their obligations to construct such a tunnel.” The brief anticipates a scenario in which Enbridge is forced to temporarily shut down the line, cancels the tunnel project and then later receives a ruling that allows the line to start back up. “The chambers urge the parties not to create avoidable short-term crises or put at risk the long-term solution (the tunnel) that they agree is superior to the status quo.” Enbridge said it would need to re-evaluate things should Line 5 be shut down.
Ohio Legislature keeps pressure on Michigan to keep pipeline open – Ohio lawmakers continue to pressure Michigan’s governor to keep open a pipeline that affects more than 20,000 Ohio jobs and nearly $14 billion in state economic activity. Rep. Brian Baldridge, R-Winchester, who testified before the Ohio Senate Energy and Natural Resources Committee earlier this week, said Michigan Gov. Gretchen Whitmer continues to make poor decisions at a time when energy security remains in question after a cyberattack on Colonial Pipeline that continues to leave the Southeast with gasoline shortages and higher prices. Baldridge also testified recently before Michigan’s Senate Energy Committee and met with the state’s Senate leadership in response to Ohio Resolution 13, which urges Michigan to keep the Enbridge Line 5 pipeline operating. The Line 5 pipeline services two Oregon refineries in northwest Ohio. According to Ohio officials, closing the line would cause a significant disruption in the supply chain, which serves as a source of jet fuel for several regional and international airports, particularly in Cleveland and Detroit. “Governor Whitmer continues to escalate her poor policy decision making at a time when the wide-ranging impact of energy insecurity in this country is at the front of our minds,” Baldridge said. “The cyberattack on the Colonial Pipeline is deeply felt throughout our Southeast region and the Michigan governor underestimates the scope of her decision. Ohio workers and consumers should not be relegated to political casualties.”
Line 5 critics challenge business advocates on shutdown potential -- Business advocacy groups from around the Great Lakes argued this week that shutting down Line 5 would lead to a crisis in regional oil and gas markets, although pipeline critics say that forecast is overblown.The two sides ramped up advocacy this week as Enbridge Inc. ignored a state deadline on Wednesday to shut down the twin pipelines in the Straits of Mackinac. The company is in a dispute in federal court over the proper legal venue, arguing with the state more broadly about whether the pipeline should be shut down.State officials notified Enbridge six months ago that the company was allegedly in violation of its easement and the public trust by operating in the Straits of Mackinac. Officials gave Enbridge six months to develop alternative plans for shipping oil and gas liquids from Superior, Wis. to refineries in Ontario, Detroit and Toledo. The May 12 deadline set off a flurry of advocacy as well as legal, executive and legislative action this week.Chambers of commerce from Great Lakes states, the U.S. and Canada on Wednesday announced a joint brief they filed in the Whitmer administration’s case against Enbridge that’s pending in the U.S. District Court for the Western District of Michigan.Valerie Brader, an attorney and co-owner of Rivenoak Law Group P.C., filed the brief on behalf of the business groups arguing that closing Line 5 would cause major disruptions in the region’s energy market by tightening supplies and eventually cost thousands of jobs at U.S. and Canadian refineries. The business groups support Enbridge’s position that its case against the state belongs in federal court, and that it would disrupt U.S.-Canada relations.
Michigan Threatens Enbridge's Profits in Great Lakes Pipeline Dispute —Michigan Gov. Gretchen Whitmer threatened to seize profits from Canadian pipeline company Enbridge Inc. if the company continues to operate a pipeline through the Great Lakes after a Wednesday deadline. In a letter sent to Enbridge on Tuesday, Gov. Whitmer and Daniel Eichinger, director of the state’s natural resources department, reminded the company the state had revoked a permitthat allowed the Line 5 pipeline to run along the bottom of the Straits of Mackinac, between Lake Michigan and Lake Huron. The governor has given the company until May 12 to shut the pipeline.Michigan has said the pipeline poses an environmental risk and that any spill from it would threaten the Great Lakes. Enbridge has said that section of the 68-year-old pipeline has never leaked and that it is taking steps to protect the lakes after negotiating a plan with former Gov. Rick Snyder to encase the pipes in a tunnel below the lake bed.Enbridge has refused the order, arguing in a lawsuit that Michigan doesn’t have the authority to close the line, which transports oil and natural gas liquids from Superior, Wis., to refineries in Michigan, Ohio, Pennsylvania, Ontario and Quebec.“Enbridge’s continued occupation and use of State-owned bottomlands in the absence of a valid and effective easement constitutes an intentional trespass,” said the governor in her letter. She said the state would, if it wins in court, require the company to disgorge “all profits derived from its wrongful use of the State’s property” after the May 12 deadline.
Why Indigenous women are risking arrest to fight Enbridge’s Line 3 pipeline through Minnesota - On Dec. 14, Simone Senogles of the Red Lake Nation in Minnesota watched as machines chewed up the forest to clear a path to the Mississippi River where Enbridge plans to bury the Line 3 pipeline. Weeks earlier, the state and federal government granted its final permits. Her friend's nephew sat 30 feet above in a tree. A cherry picker rolled forward to extract him. Senogles, a leadership team member for the Indigenous Environmental Network who fought the Dakota Access Pipeline at Standing Rock, knew the Line 3 opposition had other strategies in place — court challenges, divestment campaigns — but in that moment she felt "a tremendous sense of responsibility." She said she locked arms with about 20 other water protectors, hoping to slow the cherry picker, but dozens of police wrestled them to the frozen ground and arrested them. Senogles was charged with unlawful assembly and trespassing. She said it felt insulting. "It's Anishinaabe land," she told EHN, referring to a group of Indigenous people whose traditional homeland stretches from the East Coast through the Great Lakes to the Midwest. "Enbridge is the trespasser, they are the criminal, and they were aided by law enforcement who are supposed to be protecting us, but instead they were protecting a corporation."Police from the Northern Lights Task Force, Minnesota police officers funded by Enbridge as a condition of state permits, have arrested 72 Indigenous people and allies since construction began Dec. 1, according to task force press releases. Water protectors have put their bodies on the line, building six resistance camps along the pipeline route, chaining themselves to equipment and camping in trees. Opponents say the threats from the pipeline are many: thousands of construction workers, many from out-of-state, are building the pipeline, posing potential violence to Indigenous women. The pipeline will also contribute to climate change, emitting the equivalent greenhouse gases of 50 coal power plants or 38 million vehicles, according a report by climate action group MN350. In Minnesota, the pipeline would cross under 200 bodies of water, passing through wetlands where wild rice, a traditional Ojibwe food, grows. The pipeline will carry diluted bitumen, a heavy oil that sinks in water, making it harder to clean up.
Biden’s Pipeline Dilemma: How to Build a Clean Energy Future While Shoring Up the Present’s Carbon-Intensive Infrastructure - Even as President Joe Biden worked this week to shore up support for his push to invest $2 trillion in a new energy future for the United States, his administration found itself bombarded with the harsh realities of the nation’s oil-dependent present.More than a half-dozen federal agencies scrambled to contain fallout from a cyber-attack that shut down the Colonial Pipeline, the nation’s largest petroleum products conduit, just as the start of the nation’s peak driving season approaches. Panic buying triggered gasoline shortages and price spikes all along the East Coast before Colonial restarted the line Wednesday. Meanwhile, a legal and international conflict escalated in Michigan over Gov. Gretchen Whitmer’s ordered shutdown of Enbridge’s Line 5, a 68-year-old oil pipeline on the lakebed of the Straits of Mackinac that transports oil from Alberta, Canada’s tar sands. Another Enbridge tar sands pipeline project in Minnesota, Line 3, has become a flash point for environmental and Indigenous groups that want the Biden administration to intervene to stop construction. And a court ruling could come any day opening a new chapter in the six-year battle over the Dakota Access pipeline. Even though President Donald Trump pushed that project to completion, a court-ordered expanded environmental review is now in the hands of the Biden administration.Throughout his campaign, Biden embraced the most ambitious climate platform ever advanced by a U.S. presidential nominee, without taking a stand on oil and gas pipeline investment. The events of the past week make clear that he won’t be able to avoid the issue, even though it threatens to divide his political coalition. Labor stayed with Biden even though he pledged to block the Keystone XL pipeline, a project they supported, but which had become emblematic of climate activists’ drive against fossil fuel expansion. But after fulfilling his Keystone pledge on his first day in office, Biden stayed away from pipelines, focusing instead on a message with appeal to both unions and environmentalists: that a transition to clean energy would be an engine of blue-collar job creation.However, U.S. oil consumption is nearly back to its pre-pandemic level of 20 million barrels per day, most of it flowing at some point through the nation’s more than 190,000 miles of petroleum pipeline. More than half of that network was built before 1970. Even as Biden seeks to build an entirely new energy infrastructure, some of those pipelines are going to wear out or, as in Colonial’s case, face unexpected disruption. “Regardless of your position on climate change,” said Raimi, “shutting down certain pipelines and doing it without planning can cause a lot of problems.”
OIL AND GAS: Lawsuit: BLM ignored Colo. fracking's climate risk -- Wednesday, May 12, 2021 -- A coalition of conservation groups is bringing the Biden administration to court over a Trump-era development plan allowing hydraulic fracturing on nearly 35,000 acres in Colorado's Western Slope.
Dakota Access executive says pipeline has faced cyberattacks - The Dakota Access Pipeline has faced cyberattacks like the one against the Colonial Pipeline last week that forced it to shut down and disrupted fuel supplies to the East Coast, Energy Transfer Executive Chairman Kelcy Warren said Wednesday during an appearance at an oil conference in Bismarck. The attacks against Dakota Access failed, but Warren indicated such attempts are a growing threat to the pipeline industry. “I’m worried this is going to be tried a lot more frequently,” he told attendees of the Williston Basin Petroleum Conference at the Bismarck Event Center. The Colonial Pipeline began operating again Wednesday afternoon after it shut down last Friday. It transports nearly half the East Coast's fuel supply. The FBI has identified the hackers responsible for the attack as a group known as DarkSide. “How long before they say, ‘Wow, we get people’s attention when we do this. Let’s do some more,’” Warren said. Another big name to speak at the conference, Harold Hamm, founder of Continental Resources, called what happened to the Colonial Pipeline a “terrorist attack” and said the federal government needs to step up. Continental and the pipeline companies it works with fend off hits every day, he said. “It needs to be escalated from the FBI to the Department of Defense,” he said. “These are foreign terrorists doing this that want to take down America.”
New Lawsuit Challenges ‘Fast-Track’ Permits Used for Oil and Gas Pipelines Nationwide --Five environmental groups have filed a lawsuit in a Montana federal court alleging that the way that the U.S. Army Corps of Engineers issues permits for oil and gas pipelines nationwide violates some of the country’s cornerstone environmental laws. This new lawsuit, filed May 3, is the most recent round in a nearly decade-long battle, sparked under the Obama administration, over how regulators approach the environmental impacts from oil and gas pipelines and the extent to which the public gets a say in the permitting process. That battle centers on whether pipeline builders should be allowed to use a generic permit, known to regulators as Nationwide Permit 12 (NWP 12), when pipelines cross rivers, streams and wetlands. Critics say authorizing pipelines with NWP 12 lets builders off the hook when it comes to the environmental scrutiny that would otherwise be required and eliminates a chance for the public to weigh in before construction begins. They say that the way the Corps has used NWP 12 for oil and gas pipelines, approaching each small water crossing separately instead of looking at the cumulative effects from an entire pipeline, has put both drinking water supplies and threatened and endangered wildlife like Florida manatees and whooping cranes at greater risk. “Nationwide Permit 12 is a tool for corporate polluters to fast-track climate-destroying oil and gas pipelines and exempt them from critical environmental reviews and consultations,” said Doug Hayes, an attorney for the Sierra Club, which joined the Center for Biological Diversity, Friends of the Earth, Waterkeeper Alliance, and Montana Environmental Information Center in filing thelawsuit. “There’s no time to waste in eliminating this process, which only serves to bolster the oil and gas industry’s bottom lines.” Tens of thousands of permits for water-crossings are on the line. The Corps has estimated that NWP 12 would be used to permit more than 40,000 water crossings over the next five years — including small projects as well as massive interstate pipelines carrying fossil fuels and the raw materials for plastic and petrochemical manufacturing. Part of the problem, the lawsuit alleges, is that the Corps’ use of NWP 12 short-circuits the environmental scrutiny required by the National Environmental Policy Act (NEPA), allowing major transmission pipelines that never actually underwent a full environmental review to be approved.
Interior drops Trump proposal for Arctic offshore drilling (AP) — The U.S. Interior Department said Friday that it would not pursue a Trump administration proposal that critics feared would have weakened rules for exploratory oil and gas drilling in Arctic waters. A statement from the department said existing regulations released in 2016 remain in effect and “are critical to ensuring adequate safety and environmental protections for this sensitive ecosystem and Alaska Native subsistence activities.” Leah Donahey, Alaska Wilderness League legislative director, said the rules that have been in place incorporated lessons learned from the 2010 Deepwater Horizon oil spill in the Gulf of Mexico. She also said there has not been a public push by companies showing interest in the region. The changes proposed under the Trump administration were not finalized and sought to remove what federal agencies at that time characterized as “unnecessary, burdensome provisions.” The proposal would have eliminated a requirement that companies submit an operations plan that addresses all aspects of their expected drilling activities before filing an exploration plan, saying companies know they must prepare for risks and challenges through their exploration plan. It also would have changed some rules around containment equipment, among other things, according to a fact sheet from the agencies. Kara Moriarty, president and CEO of the Alaska Oil and Gas Association, said the changes proposed last year made “substantial improvements over the original rule, including revisions to incorporate new technologies and modern drilling practices.” “It is unfortunate that politics have taken over what should have been a purely scientific exercise,” she said in a statement.
A U.S. Virgin Islands Oil Refinery Had Yet Another Accident. Residents Are Demanding Answers - St. Croix residents are demanding answers from a U.S. Virgin Islands oil refinery, and from the officials regulating it, in the wake of a series of recent accidents that they worry have exposed them to toxic chemicals and endangered their health.Since restarting operations in February, the Limetree Bay oil refinery has experienced at least three accidents that have directly affected the neighborhoods surrounding it. That includes a chemical release that occurred during maintenance on the plant last week that produced a nauseating odor, forcing schools to shut down and send children home for the second time in less than a month.The refinery, one of the largest in the United States, has been under investigation by the Environmental Protection Agency since March for possible permit violations, and specifically for a February flaring incident that spewed a plume of steam and fuel residue into the air, covering more than 130 homes with specks of oil and contaminating the drinking water of more than 60 residents. . Croix to look into another flaring incident that released large amounts of sulfuric gases into the air that month. Many residents remain confused over exactly what chemical they had been exposed to. Flaring occurs when a buildup of pressure triggers a safety valve to send chemicals to an incinerator that burns them off. The Virgin Islands government had initially said the April incident released hydrogen sulfide into nearby neighborhoods, while Limetree said the hydrogen sulfide was burned off in a flare, converting it into sulfur dioxide.Both chemicals can be harmful—and even deadly—to humans in high concentrations, causing lung and eye irritation and complicating breathing. The April investigation also found that Limetree was in violation of the Clean Air Act for failing to operate five sulfur dioxide monitors that surround its 1,500-acre property as required by two of its operating permits, though Limetree disputes those requirements. Days after EPA officials announced the Notice of Violation on May 3, Limetree said it would “voluntarily” begin operating the five monitors. “Community concern is growing immensely,” said Jennifer Valiulis, executive director for the St. Croix Environmental Association. “We are receiving more and more calls each day from people that are frustrated with the lack of information and desperate for some relief from the air pollution that is making them sick.”
St. Croix refinery halts operations after raining oil on local residents once again -- A troubled refinery in St. Croix announced Wednesday evening that it would temporarily halt operations after raining oil on local residents for the second time in just over three months.Limetree Bay Refining, which showered a fine mist of oil over houses more than two miles away just three days after restarting operations on Feb. 1, spewed oil and sulfur dioxide into the air Wednesday afternoon. The accident triggered an alert from the Virgin Islands Territorial Emergency Management Agency, which warned residents about a “gaseous odor” and urged those with respiratory illnesses to stay inside.The company acknowledged in a statement that Wednesday’s “incident resulted in a release of oil droplets which traveled directly west,” affecting the neighborhood of Enfield Green, an affluent, gated community, “as well as some industrial sites.” “In response to today’s incident, Limetree Bay has decided to temporarily suspend production activities until further notice,” it added. The island where it showered oil Environmental Protection Agency Administrator Michael Regan tweeted Wednesday night, “The repeated incidents at the refinery are unacceptable. EPA has a team on St. Croix and is committed to taking all necessary action to ensure people’s health and safety is protected.” The plant, which received approval to operate under the Trump administration, has come under close scrutiny since President Biden came into office. In March, the EPA revoked one of the permits the last administration granted the refinery just before Trump stepped down, and it is now investigating whether it poses “an imminent risk to people’s health.” The refinery has experienced multiple accidents over the past three months that have sickened local residents and forced schools, as well as local government offices, to close. The fire occurred at the same unit that caused the Feb. 4 accident, which contaminated dozens of open cisterns — from which many residents get water they use to drink, cook and bathe — and coated more than 200 cars as well as rooftops and gardens.
EPA orders Virgin Islands refinery to shut down, citing ‘imminent’ health threat --It didn’t take long for the Environmental Protection Agency official to discover the problem.It was 7:10 p.m. on a Wednesday night. The EPA employee who had been deployed to the U.S. Virgin Islands to investigate an accident-plagued refinery emailed colleagues to give them the news: “there is oil on my windshield.”On Friday, the Biden administration shut the plant down, citing an “imminent” threat to people’s health after several recent accidents contaminated St. Croix’s drinking water and left hundreds of people sick. In its 45-page order, the agency described the pollution’s impact in the words of its own employees who had come to stop it.“The odor I briefly encountered was overwhelming and nauseating,” recounted another EPA staffer, who was coordinating the agency’s response on the island and inhaled gasoline-like fumes May 6. “I normally am suited up with respiratory protection and other [personal protective equipment] prior to being exposed to something like this.”The rare move by the EPA, which has invoked emergency powers under the Clean Air Act only three times before, signals the extent to which the Biden administration has demonstrated its commitment to environmental justice.“It means that voices of the people have finally been elevated to the point that they’re being heard,” said Frandelle Gerard, who directs the Crucian Heritage and Nature Tourism Foundation and has criticized the refinery.In a statement, EPA Administrator Michael Regan said the agency took the extraordinary step after Limetree Bay showered oil on local residents twice, spewed sulfuric gases into the surrounding area and released hydrocarbons into the air.“This already overburdened community has suffered through at least four recent incidents that have occurred at the facility, and each had an immediate and significant health impact on people and their property,” Regan said. “EPA will not hesitate to use its authority to enforce the law and protect people from dangerous pollution where they work, live, and play.”
Mexico Natural Gas Market Spotlight: Expect Higher Prices in Coming Months - The U.S. Energy Information Administration (EIA) sees natural gas spot prices at Henry Hub averaging $2.78/MMBtu in the second quarter and $3.05 for 2021 overall, a slight upward revision from its forecast last month.According to new research from the U.S. Department of Energy, Mexico paid $2.12/MMBtu on average for U.S. gas in 2020 and $2.57/MMBtu in 2019.The higher prices, based on strong liquified natural gas (LNG) demand and rising U.S. consumption, will translate to higher prices for Mexico, which is importing in excess of 6 Bcf/d on cross-border pipelines from the United States.“In 2022, we expect the Henry Hub price will fall to an average $3.02 amid slowing growth in LNG exports and rising production,” EIA researchers said.Meanwhile Mexico’s production is showing signs of recovery after two months of weakness, according to Wood Mackenzie’s Mexico analyst Ricardo Falcon.So far this month, Mexican dry gas output has averaged slightly more than 2.4 Bcf/d, according to Wood Mackenzie estimates. “This volume exceeds the average of the preceding two months by about 12%. Due to several operating and nontechnical risks, domestic dry gas processing and production saw record lows between February and March this year. If continued, this trend could induce some offsetting effect on U.S. piped gas exports to Mexico.”Anger mounts in Turkey at Israel’s onslaught against Gaza - As Israel’s ongoing onslaught on Palestinians in East Jerusalem and Gaza provokes mass anger in Turkey, it is also exposing the hypocrisy of the Justice and Development Party (AKP) government led by President Recep Tayyip Erdoğan over the plight of the Palestinian people. The Turkish government and other venal bourgeois regimes in the Middle East are all complicit in the Israeli government’s assault on the Palestinians.Over the past week, thousands of people in many cities of Turkey have protested against Israel’s attacks on the Al-Aqsa mosque in East Jerusalem and subsequent air strikes in Gaza. Mass demonstrations took place in front of the Israeli Consulate and Taksim Square in Istanbul, despite the curfew imposed amid the COVID-19 pandemic.President Erdoğan called Israel a “terror state” last Saturday, after Israeli police stormed the Al-Aqsa mosque, and urged all Muslim countries and the “international community” to take “effective” measures against Tel Aviv.The major establishment parties in parliament—the ruling AKP and its fascistic ally, the Nationalist Movement Party (MHP), as well as the bourgeois opposition, the Kemalist Republican People’s Party (CHP), far-right Good Party and Kurdish nationalist Peoples’ Democratic Party (HDP)—condemned Israel in a rare joint statement on Monday.“We declare that we will always continue to react to Israel’s aggressive actions aimed at eroding the status of Jerusalem and the Temple Mount, and [Israel’s] attempts to usurp the legitimate rights of the Palestinian people,” it said, before claiming, “We strongly declare that we will continue to defend the Palestinian cause and [support] the struggle of the brotherly Palestinian people for freedom, justice and independence.”
Cash-Strapped Pemex Delays Payments to Some Private Oil Partners - Petroleos Mexicanos is racking up millions of dollars in late payments to oil companies as it struggles to generate cash amid skyrocketing debt and weaker crude sales. While Pemex has long sought to stretch its cash further by delaying payments to contractors, people with knowledge of the situation say it’s now also deferring reimbursement to some partner companies in an effort to postpone spending money that’s in increasingly short supply. Some private oil companies in Mexico sell their barrels to Pemex to mix with its own hydrocarbons for export because they lack the infrastructure and scale to sell the crude on their own, the people said, declining to be identified because they weren’t authorized to speak to the media. The Mexican state-owned oil giant owed about $60 million as of April 30 for crude and natural gas to Egypt’s Cheiron Petroleum Corp. and about $4 million as of April 16 to Hokchi Energy, a Mexican subsidiary of Argentina’s Pan American Energy LLC, as well as undisclosed amounts to Wintershall Dea GmbH, according to people with knowledge of the situation, and company documents seen by Bloomberg. Pemex’s latest payment woes underscore the deteriorating state of its finances after more than a decade and a half of falling output due to underinvestment. It has had negative free cash flow every year since 2007, data compiled by Bloomberg show, and has amassed $113.9 billion of debt, far more than peers of a similar size or larger. To be sure, Pemex’s bonds are rising amid an oil-market rebound, signaling growing confidence in the company’s finances as crude prices climb. The government-owned company has never defaulted on its debt. While deferred payments aren’t uncommon among state-owned producers in Latin America, delays in reimbursing partners could erode trust, making it even harder for the producer to stage a recovery, Francisco Monaldi, a lecturer in energy economics at Rice University’s Baker Institute for Public Policy, said in a phone interview. Representatives from Pemex didn’t respond to multiple requests for comment by phone and email. Cheiron didn’t respond to requests for comment made during the Muslim holy month of Ramadan, when working hours in Egypt are limited. Pemex owed Hokchi more than $4 million as of April 16 for oil and gas exports sold in December and January from its field by the same name, with the debt owed since mid-March of this year, according to the documents, and people familiar with the situation. During the term of its contract with Hokchi Energy, “Pemex has made payments corresponding to the volumes of hydrocarbons delivered. Regardless of any specific delay, the relationship developed with Pemex is within the usual commercial terms,” Hokchi said in a statement. Hokchi didn’t specify whether payments for December and January exports had been made. A Wintershall spokesman said the company has a “trustful partnership” with Pemex, referring to a joint venture at the onshore Ogarrio field, and work is ongoing to resolve the payment issue. Wintershall is the operator of the field, with a 50% stake.Bloomberg
Gas Flaring Declined in 2020, Study Finds – NY Times — Gas flaring worldwide decreased by 5 percent in the pandemic year, mostly because of lower demand for oil, according to a recent report from the World Bank. While the overall drop was expected, the report offered a detailed picture of the flaring activities around the world, with steep declines in some areas, like the United States, and surprising increases in others, notably China. Flaring occurs when the gas that emerges with crude oil is burned off rather than captured. That burning emits carbon dioxide, a gas that is the main contributor to climate change. According to World Bank officials, flaring adds roughly 400 million metric tons of CO2 equivalent emissions to the atmosphere every year. According to the report, Russia was responsible for more flaring overall than any other country in 2020, contributing 15 percent of the global total. But within Russia, there were areas of progress. Burning continued to decrease in the Khanty-Mansi region of Siberia, where flaring volumes have dropped by nearly 80 percent over the previous 15 years. The other top flaring countries, according to the report, were Iraq, Iran, the United States, Algeria, Venezuela and Nigeria. China saw the biggest percentage increase among the top 30 countries, with a surge of 35 percent despite the country’s oil production remaining flat. The report cited testing in new oil fields in the country’s remote northwest. The increase moved China up to 9th place overall in flaring volume, from 15th in 2019. The United States recorded a significant 32 percent drop in 2020 from the year before, mainly because of new infrastructure to capture gas that otherwise would have been flared. ImageA drilling rig on the Yamal Peninsula in Siberia in 2019. The report, published at the end of April, relied on data collected by two satellites operated by the National Oceanic and Atmospheric Administration and analyzed at the Payne Institute for Public Policy at the Colorado School of Mines. In addition to contributing planet-warming carbon dioxide to the atmosphere, routine gas flaring can harm the health of people who live near gas sites. It also wastes a potentially useful energy source, a problem that is especially acute in poorer countries.
Brazil LNG demand heading for record year --Brazil is on track to import a record volume of LNG this year because of persistent dry weather coupled with the commissioning of new LNG-to-power projects. As arid conditions dragged on into April, the electricity sector monitoring committee (CMSE) cleared the dispatch of thermoelectric plants and electricity imports. Hydroelectric reservoirs in the strategic southeast/center-west grid ended April at the lowest average level since 2015. September-April rainfall was the lowest since government records began in 1931. With dry season underway, LNG-linked thermoelectric plants were dispatched ahead of schedule last month to slow the decline of the reservoirs. LNG demand started the year at above-normal levels, with send-out of 18.25mn m³/d in the first two months of the year, according to mines and energy ministry data. This compares to just 4.94mn m³/d in the same period of 2020 and 18.17mn m³/d in the first two months of 2015, when full-year send-out hit a record 17.94mn m³/d. All of the January-February send-out came from two terminals operated by state-controlled Petrobras — Guanabara with 15.33mn m³/d, and Pecem 2.93mn m³/d. Petrobras recently reported total send-out of 19mn m³/d in the first quarter, up nearly 175pc on the year.In April, thermoelectric generation soared by 37pc to 11,613MW, up from 8,492MW in April 2020, according to preliminary data from the electricity clearinghouse CCEE. Nearly all of the increase came from gas-fired power plants, with an average of 5,837MW, more than double the year-earlier average. Petrobras' leading role in LNG imports is starting to shrink, in line with itsanti-trust commitments. The company is currently in the process of leasing its Bahia LNG terminal. Private-sector Gas Natural Acu's (GNA) 1.33GW GNA1 LNG-to-power project in Rio de Janeiro state is scheduled to begin commercial operations on 31 May. The 1.5GW Porto de Sergipe LNG-to-power project is expected to begin operating by June.
Fire at Syrian oil refinery extinguished after leakage -- Firefighters extinguished a blaze Sunday in a distillation unit at one of Syria’s two oil refineries, Syrian state TV reported. No one was hurt, but the fire caused some damage to the facility, a refinery official said. The TV named the cause of the fire as crude oil leakage from one of the pumping stations at the Homs Oil Refinery in the central province of Homs. The fire came amid a series of mysterious attacks on vessels and oil facilities in Syria over the past months. The war-torn country has been suffering from fuel shortage in recent months. Head of Homs Oil Refinery Suleiman Mohammed told state TV that the distillation unit that caught fire is one of four at the refinery. In addition to the refinery in Homs, Syria has another one near the coastal town of Banias. Both are government-run and operating. Syria’s oil resources are mostly outside of government controlled areas. Syria controls some small oil and gas fields in the country’s center but most of the country’s large fields in the east are controlled by U.S.-backed Kurdish-led fighters. This has made Damascus reliant on Iran for fuel. The U.S. Treasury sanctions have targeted a network that spanned Syria, Iran and Russia responsible for shipping oil to the Syrian government. In late April, Syria’s oil ministry said a fire erupted in an oil tanker on its coast after what it said was a suspected drone attack. In January, an explosion in an oil tanker outside a state fuel distribution company in Homs caused massive fire. The minister of oil told Syrian state TV at the time that seven tankers caught fire but there were no civilian casualties.
Oil gains after cyberattack forces shutdown of U.S. fuel pipelines --Oil rose on Monday after major U.S. fuel pipeline operator Colonial Pipeline had to shut fuel pipelines due to a cyberattack, raising concerns about supply disruption and pump price increases. Colonial Pipeline said on Sunday its main fuel lines remained offline after the attack that shut the system on Friday, but some smaller lines between terminals and delivery points were now operational. "The Colonial Pipeline hack headlines over the weekend have lifted oil prices," said Jeffrey Halley, analyst at brokerage OANDA. "Colonial aside, oil may be vulnerable to some abrupt long-covering sell-offs as the week progresses." Brent crude was up by 31 cents, or 0.5%, at $68.59 a barrel by 0820 GMT. U.S. West Texas Intermediate futures (WTI) crude rose by 46 cents, or 0.7%, at $65.36. Both benchmarks rose more than 1% last week, their second consecutive weekly gain. "The major takeaway is the bad guys are very adept at finding new ways to penetrate infrastructure," Andrew Lipow, president of Lipow Oil Associates told Reuters. "Infrastructure has not developed defenses that can offset all the different ways that malware can infect one's system." The White House was working closely with Colonial to help it to recover. Commerce Secretary Gina Raimondo said the pipeline fix was a top priority for the Biden administration and Washington was working to avoid more severe supply disruptions. Oil has risen 33% this year due to supply cuts by the Organization of the Petroleum Exporting Countries and allies, known as OPEC+, and easing coronavirus movement restrictions in the U.S. and Europe. While some analysts have said oil demand may never reach pre-pandemic levels, Goldman Sachs said it expected this by the end of the year and predicted Brent would hit $80 and WTI $77 within six months.
Oil ends pennies higher as traders weigh impact of Colonial Pipeline cyberattack Oil futures ended a few pennies higher Monday, after a ransomware attack forced the shutdown of pipelines supplying around 45% of fuel to the East Coast. Crude prices spent some time during the session trading a bit lower on expectations that the U.S. will have to slow its refining activities and boost imports of gasoline. Alpharetta, Ga.-based Colonial Pipeline Co., which operates the 5,500-mile Colonial Pipeline system that transports fuel from Gulf Coast refineries to the East Coast, said over the weekend that it was the victim of a cyberattack and had temporarily shut down pipeline activity to contain the threat. Oil prices pulled back for bit as "talk of traders booking European cargoes for gas to import to the U.S., as well as fears that refining runs in the Gulf Coast will have to slow" due to the pipeline shutdown, In an update on Monday (link), however, Colonial Pipeline said it's executing a plan to "facilitate a return to service in a phased approach," with a goal to "substantially" restore operational service by the end of the week. West Texas Intermediate crude for June delivery rose 2 cents, or 0.03%, to settle at $64.92 a barrel on the New York Mercantile Exchange. July Brent crude , the global benchmark, added 4 cents, or nearly 0.1%, at $68.32 a barrel on ICE Futures Europe. Gasoline futures jumped early Monday on Nymex, then gave back nearly all of those gains as oil prices eased. The June contract rose 0.3% to $2.13 a gallon after trading as high as almost $2.22. June heating oil edged up by 0.3% to $2.02 a gallon."The big unknown is how long the shutdown will last, but clearly the longer it goes on, the more bullish it will be for refined product prices," "Stronger prices on the U.S. East Coast will drag refined product prices higher in other regions, given that an extended shutdown will see the East Coast having to turn to waterborne cargoes, particularly from Europe,"
Oil falls as pipeline outage weighs on U.S. Gulf Coast refinery runs --Oil prices fell on Tuesday as the prospect of the main U.S. East Coast gasoline pipeline remaining shut for the rest of this week led some U.S. Gulf Coast refiners to cut output, denting their appetite for crude.U.S. West Texas Intermediate (WTI) crude futures fell 72 cents, or 1.1%, to $64.20 a barrel, after gaining 2 cents on Monday.Brent crude futures dropped 66 cents, or 1%, to $67.67 a barrel, after climbing 4 cents on Monday.Colonial Pipeline, which transports more than 2.5 million barrels per day (bpd) of gasoline, diesel and jet fuel, shut down its network on Friday after being hit by a cyberattack. "It's quite possible we'll see reduced crude oil demand. Some refineries in Texas have already scaled back runs because of the pipeline being out," said Lachlan Shaw, National Australia Bank's head of commodity research."That will weigh on crude oil prices pretty obviously, even though parts of the pipeline are restarting and Colonial is expecting the pipeline to be back to capacity by the weekend."Colonial said on Monday it aims to resume full operations by the end of this week. The outage, however, has already led Motiva Enterprises LLC to shut two of three crude units at its 607,000 bpd Port Arthur refinery in Texas, the largest in the United States.Total SE also cut gasoline output on Monday at its 225,500 bpd Port Arthur refinery due to the pipeline outage. The benchmark U.S. gasoline futures contract, which spiked after the outage, has now retreated to pre-Friday levels on the prospect of the restart. On Tuesday, the contract was down 0.6% at $2.1212 a gallon.On the positive side for crude, analysts are expecting data to show U.S. crude inventories fell by about 2.3 million barrels in the week to May 7, following an 8 million-barrel drop the previous week, according to a Reuters poll. Gasoline stocks are expected to have fallen by about 400,000 barrels, six analysts estimated on average ahead of reports from the American Petroleum Institute industry group on Tuesday and the U.S. Energy Information Administration on Wednesday.
Light Crude Ends Session Above $65 -- Oil rose as a weaker dollar lent support and offset a burgeoning pile up of crude in the U.S. Gulf Coast as refineries there cut runs in response to the Colonial Pipeline shutdown. Crude futures in New York rose less than 1% Tuesday. The dollar has traded steadily weaker, making commodities priced in the currency more attractive. Colonial Pipeline Co. is working to restart its oil-products system, the largest in the U.S., after a cyberattack shuttered operations. While gasoline stations from Alabama to Virgina report shortages, refiners in the U.S. Gulf are reducing output to avoid a glut in the absence of the pipeline. Some refiners have already chartered ships to store refined products offshore. “The dollar index trading lower explains the slight increase in oil prices,” said Bob Yawger, head of the futures division at Mizuho Securities. The weak dollar may have saved the day for crude oil, which was facing pressure from refiners being forced to store barrels they can’t feed into the pipeline, he said. U.S. crude oil prices are up 2.7% so far this month even with coronavirus-induced demand concerns, particularly in India, limiting rallies. Still, the Organization of Petroleum Exporting Countries on Tuesday lifted its forecast for the amount of crude it will need to produce and the group now sees a small decline in U.S. supplies this year, mostly due to the Texas freeze in February. Traders are expecting “a gradual resolution to the Colonial Pipeline shutdown,” according to Louise Dickson, an analyst at consultant Rystad Energy. “The market is again looking to Asia, Covid-19 cases, and the next signals for oil demand outlook.” West Texas Intermediate for June delivery rose 36 cents to settle at $65.28 a barrel in New York. Brent for July settlement gained 23 cents to end the session at $68.55 a barrel. U.S. gasoline futures rose 0.3% to settle at $2.1399 a gallon. Meanwhile, the knock on impact of the Colonial disruption is rippling through to everything from refining to shipping.
WTI Dips After Big Surprise Build In Gasoline Inventory - Amid all the chaos in equity markets, oil managed to bounce back to modest gains on the day with WTI as a weaker dollar offset some concerns of a growing pile up of crude in the U.S. Gulf Coast as refineries there cut runs in response to the Colonial Pipeline shutdown.Traders are expecting “a gradual resolution to the Colonial Pipeline shutdown,” according to Louise Dickson, an analyst at consultant Rystad Energy.“The market is again looking to Asia, Covid-19 cases, and the next signals for oil demand outlook.”This week's inventory data will not show the impact of the cyberattack on the pipeline. API:
- Crude -2.533mm (-2.1mm exp)
- Cushing -1.209mm
- Gasoline +5.64mm - biggest build since April 2020
- Distillates -872k
After the previous week's big crude draw, analysts expected another draw and were right but gasoline stocks unexpectedly surged...WTI hovered around $65.40 ahead of the API data, and dipped on the big gasoline build (and once again, this is before the Colonial impact)... “We are far from out of the out of the woods with the Colonial situation,” . “A scare among consumers is increasingly likely, where a run on gas stations may develop more broadly, especially if there is no resolution by the end of the week.”
WTI Fades From Cycle Highs After Disappointing Inventory Data --Oil prices are continuing their recent acceleration this morning, with WTI above $66.50, after the International Energy Agency said a record glut built up last year is gone. Last night's surprise gasoline build from API did nothing to shake confidence in demand returning (crude stocks dropped as expected). It wasn't all positive though as IEA cut its oil demand forecasts as COVID continues to crush India.“The outlook for demand remains fragile,” But the agency is “expecting a very strong recovery in demand growth in the second half of the year.”Bear in mind this week's inventory data will not show the impact of the cyberattack on the pipeline. DOE
- Crude -426k (-2.1mm exp)
- Cushing -421k
- Gasoline +378k
- Distillates -1.734mm
Official EIA data is significantly different from API's report with crude stocks only drawing down very modestly and gasoline inventories only building by a small amount...Keep in mind all these changes happened before Colonial Pipeline went down. The picture is likely much altered right now, with East Coast stockpiles falling this week because of the pipeline hack. Some three-quarters of stations in a few cities are without gasoline today, according to Gas Buddy. US crude production remains 'disciplined' despite soaring prices and rising rig counts...
Oil surges with U.S. supply drop underscoring global rebalancing – BNN - Oil rose to the highest since early March with a second straight weekly decline in U.S. crude supplies underscoring the progress the world has made in draining a record supply glut built up last year. Futures in New York gained for a fourth straight day on Wednesday, while global benchmark Brent crude neared US$70 a barrel. A U.S. government report showed domestic crude inventories fell to the lowest since late February last week. Meanwhile, gasoline supplies rose by 378,000 barrels, the Energy Information Administration report showed. Declining crude stockpiles in the U.S. support the International Energy Agency’s view that the world has largely worked off the surplus it accumulated when the pandemic devastated demand. While the agency cut its oil consumption forecasts in a monthly report, it said the glut is now just a small fraction of levels seen at the depths of the coronavirus fallout last year. The weekly storage report showed domestic supply levels ahead of the cyberattack that halted the largest U.S. oil-products pipeline system. Panic-buying spurred by the ongoing outage of the Colonial Pipeline has pushed retail gasoline prices above US$3 a gallon for the first time in more than six years, while supplies at some terminals have been wiped out on the U.S. Northeast. That’s all before the upcoming summer travel season is expected to unleash a wave of pent-up demand built up during the pandemic. “Even if everything is fixed at this second, we’re probably still looking at a couple of weeks of trouble,” said Bill O’Grady, executive vice president at Confluence Investment Management in St. Louis. “That runs us right into Memorial Day,” around which the U.S. summer driving season starts. Still, the impact of the shutdown on headline crude prices is muted for now. The market remains buoyed by prospects for recovering energy demand around the world and broader bets on global inflation. U.S. consumer prices climbed in April by the most since 2009, exceeding forecasts, official figures showed Wednesday. Prices: West Texas Intermediate for June delivery climbed 80 cents to settle at US$66.08 a barrel. Brent for July settlement gained 77 cents to US$69.32 a barrel. The U.S. average retail gasoline price was at US$3.008 a gallon, according to auto club AAA. The EIA report showed crude exports falling by the most on record to the lowest since 2018. While the figure jumped above 4 million barrels a day the previous week, it has struggled to consistently top 3 million barrels a day for several months.
Oil drops as India coronavirus crisis tempers rally - Oil drops on India's COVID-19 crisis, pipeline resumption - Oil prices fell more than 2% on Thursday as India's coronavirus crisis deepened and a key U.S. pipeline resumed operations, halting a rally that had lifted crude to an eight-week high after the IEA and OPEC forecast a rebound in global demand later in the year. Brent crude was down $1.65, or 2.3%, at $67.67 a barrel, after rising 1% on Wednesday. West Texas Intermediate (WTI) was down $1.66 cents, or 2.5%, to $64.42 a barrel, having risen 1.2% in the previous session. If those losses are sustained, both contracts would mark their biggest daily drops in percentage terms since early April. In a bearish signal for oil demand, a variant of the coronavirus has swept through the countryside in India, the world's third-biggest importer of crude. Medical professionals have not been able to say when new infections will plateau and other countries are alarmed over the transmissibility of the variant that is now spreading worldwide. "Concerns are growing that the untamed spread of the coronavirus in India and in Southeast Asia will dent oil demand," PVM analysts said in a note. "Its impact, however, is expected to be relatively brief and the second half of the year will see the healthy revival of oil demand growth." Meanwhile, fuel shortages worsened in the southeastern United States, six days after the shutdown of the Colonial Pipeline, the largest U.S. fuel pipeline network, following a ransomware attack. The pipeline began to slowly restart on Wednesday and Colonial, which pumps more than 2.5 million barrels per day of fuel, said it hoped to get a large portion of the network operating by the end of the week. "While the disruption is meaningful for local retail markets, its impact is still likely to be transient as there is no physical damage to the pipeline," Goldman Sachs analysts said. The dollar also strengthened compared with a basket of other currencies, making oil more expensive for holders of other currencies.
Oil Prices Tumble On Inflation Worries - Oil prices fell sharply on Thursday as inflation fears dented hopes for economic recovery. Overnight data showed that the U.S. annual inflation rate jumped to the highest in 13 years and well above forecasts, raising concerns of a tighter monetary policy and its impact on the global growth outlook. Meanwhile, concerns over a disruption in the supply chain eased after the Colonial Pipeline Company announced that it was restarting pipeline operations and that the supply chain would "return to normal" within the next several days. Brent futures for July settlement plunged 2.5 percent to $67.56 per barrel, while WTI crude oil futures for June delivery were down 2.7 percent at $64.29 amid broad-based risk aversion in financial markets. As inflation worries mount, China Premier Li Keqiang urged the country to deal effectively with the commodity price surge and its impact, according to a state television report. The International Energy Agency (IEA) on Wednesday cut its global crude oil demand growth expectations for 2021, saying that the coronavirus crisis in many parts of Asia, particularly India, has clouded the outlook for consumption.
Oil Loses Over 3% Amid U.S. Fuel Pipeline Reopen, India COVID - - Oil prices tumbled more than 3% Thursday for their worst loss in a month after a key pipeline for U.S. fuel reopened from a cyberattack, erasing gains from earlier in the week helped by a squeeze in gasoline supplies. India’s festering Covid situation, which was infecting more than 350,000 people a day and killing over 4,000, added to the downward pressure on oil which counts on the country as its third largest consumer. New York-traded West Texas Intermediate, the benchmark for U.S. crude, settled down $2.26, or 3.4%, at $63.82 per barrel. It was WTI’s sharpest one-day decline since April 5, when it lost 4.5%. London-traded Brent, the global benchmark for crude, finished the session down $2.27, or 3.3%, at $67.05. Brent’s previous sharpest loss was also on April 5, when it fell 4.2%. The price drop was largely triggered by the reopening of the Colonial Pipeline that was shut for six days to contain a cyberattack on the largest fuel delivery system in the U.S. East Coast. The outage had led to a temporary gasoline squeeze in the No. 1 economic region of America, sending gasoline futures up 2% at one point this week and pump prices to seven-year highs of $3 a gallon. On Thursday, gasoline futures settled down 3% to just under $2.10 per gallon on news that the Colonial Pipeline was back in operation after its operator reportedly paid a $5 million ransom to the hackers of its system. President Joe Biden declined comment when asked about this. The setback in both oil and crude prices raised questions about the seasonal upward momentum for energy markets ahead of the Memorial Day weekend in the United States. The occasion, which falls on May 31 this year, has traditionally served as the starting gun for the summer race in oil prices, as demand peaks from Americans who set out for long road trips. But the outbreak of the coronavirus pandemic last year upended this, with only 23 million people traveling by road for Memorial Day 2020, the lowest on record since the American Automobile Association began recording the data in 2000. The AAA expects 37 million travelers this time, up 60% from last year. Demand for oil has improved remarkably from a year ago, with the 50 U.S. states having reopened most or all of their economies from Covid-lockdowns and restrictions.
Oil Futures Rally as Inflation Buzz Intensifies, US Dollar Softens - Oil futures nearest delivery on the New York Mercantile Exchange and the Brent crude contract on the Intercontinental Exchange rallied in afternoon trade Friday, sending the U.S. crude benchmark above $65 per barrel (bbl). The gains came on the back of an eroding U.S. dollar as traders positioned for higher inflation and weaker-than-expected macroeconomic data in the United States. U.S. retail sales for April were unchanged from the previous month at a collective $619.1 billion, according to the data from the Commerce Department, missing expectations for a 1% gain. The weaker-than-expected reading, however, follows a 10.7% surge in March, fueled by the stimulus checks and pent-up demand in the wake of the lifting of government restrictions on businesses. Some analysts attribute the flat retail sales reading to a stabilizing economy and a more normal operating environment for services.Sales were up 2.9% at auto and parts dealers, where shortages in available cars have driven up prices, and 3% at restaurants and bars, a positive sign for the hard-hit industry as the U.S. economy more fully opens.On Thursday, the Centers for Disease Control and Prevention lifted its guidance on masking for the fully vaccinated, saying those who have received all their shots can now safely do most indoor and outdoor activities without social distancing or wearing masks.The move should further boost economic activity and faster return to work and entertainment venues.With an expected increase in social and business activity also comes the prospect for a faster increase in inflation, with recent data showing consumer price increases are running at their fastest pace since 2008 and factory-gate inflation hit its highest level since 2010. The Department of Labor reported the consumer price index jumped 0.8% in April compared with a consensus for a 0.2% increase, lifting year-on-year headline inflation to 4.2% -- the largest 12-month increase since September 2008.Fanned by inflation fears, U.S. consumer sentiment unexpectedly slumped in May to 82.8 versus estimates for a gain to 90.1. Expected year-ahead inflation rate and the long-term inflation rate was the highest in over a decade, said Richard Curtin, the survey's chief economist."Rising inflation also meant that real income expectations were the weakest in five years," Curtin said. The average of net price mentions for buying conditions for homes, vehicles, and household durables were more negative than any time since the end of the last inflationary era in 1980, he said.
Oil up 3rd Week in Row After Swings on Pipeline Saga, Gasoline & India - It’s been a volatile week for oil as the Colonial Pipeline saga and the associated boom-bust-boom in gasoline from that played against the backdrop of India’s festering Covid situation. With Friday’s settlement, the bulls in crude could heave a sigh of relief: It was another winning week. In fact, the third in a row. New York-traded West Texas Intermediate, the benchmark for U.S. crude, settled at $65.37, up $1.55, or 2.4%. The rally helped offset a chunk of Thursday’s 3.4% drop — which was WTI’s worst one-day decline since April 5. For the week, the U.S. crude benchmark gained 0.7%, adding to last week’s 2.1% advance and the prior week’s 2.3% rise. London-traded Brent, the global benchmark for crude, hovered at $68.68 by 2:45 PM ET (18:45 GMT), up $1.63, or 2.4%, on the day. Brent dropped 3.3% in the previous session, also its most since April 5. For the week, the global crude benchmark showed a gain of 0.6%, adding to last week’s 1.5% advance and the prior week’s 1.7% rise. Friday’s rebound in oil was helped by short-covering on the previous day’s activity and a second day of broad gains on Wall Street after three prior days of carnage. Also fueling the market — literally — was optimism about gasoline demand in the next two weeks before the May 31 Memorial Day holiday in the U.S., which typically serves as the starting gun for the summer race in oil prices as demand peaks from Americans setting out on long road trips. The American Automobile Association expects as many as 37 million road travelers on this Memorial Day, up 60% from last year’s pandemic-suppressed 23 million.Aside from gasoline, the market’s focus was on the Covid situation in India, the world’s third biggest oil consumer, where 4,000 people died from the virus for the third straight day and total infections crossed 24 million. India is in the grip of the highly transmissible B.1.617 variant of the coronavirus, first detected there and now appearing across the globe. Prime Minister Narendra Modi said his government was "on a war footing" to try to contain the strain.
WTI Ends Week Above $65 | Rigzone - Oil in New York surged the most in a month on Friday as prices garnered support from a recovery in equities and a softer dollar. West Texas Intermediate climbed back above $65 a barrel, eking out a third straight weekly gain as a weakening dollar boosted appeal for commodities priced in the currency. Concerns persist over the spread of Covid-19 in Asia, which has tempered further gains. Progress on reopening economies in countries including the U.S. supports expectations for heavy summer travel, buttressing the market’s underlying structure from recent weakness. The premium of Brent’s nearest contract against the next month strengthened on Friday to its widest in over a week. Growth in that structure, which is called backwardation, suggests the market is expecting tighter supplies. “The economy looks a lot better,” with the U.S. easing its mask mandate “suggesting that we’re going to be close to normal soon,” said Michael Lynch, president of Strategic Energy & Economic Research. Still, “any boost that happens with demand will likely be met by restored supply.” Oil prices have been stuck in a range lately, with optimism around global inventories rebalancing being offset by constant reminders that parts of the world remain far from a full recovery from the pandemic. The International Energy Agency said this week that the global glut that built up last year has cleared. However, the agency also lowered its demand estimates due to the virus resurgence in India. “So far, the demand recovery is still fairly uneven,” said Bob Ryan, commodity & energy strategist at BCA Research. “Covid has not yet been contained. But next year, prices more than likely drift up toward $70 a barrel, because of the synchronization of the global recovery from the pandemic.” Meanwhile, gasoline stations are still in the process of returning to normal following the restart of the Colonial Pipeline. Fuel supply disruptions in parts of the U.S. East and South may still be weeks out from returning to normal after a cyberattack halted the largest fuel pipeline in the U.S. WTI for June delivery rose $1.55 to settle at $65.37 a barrel. The contract gained 0.7% for the week. Brent for July settlement gained $1.66 to end the session at $68.71 a barrel, posting a 0.6% weekly gain. Oil demand looks set to continue rising into this summer with restrictions easing in many of the world’s largest economies.
Iran To Saudi Arabia: Sell Our Oil And We Will Reduce Houthi Attacks - Iran is looking to persuade its regional rival Saudi Arabia to help it to sell Iranian crude oil on international markets in exchange for limiting attacks from the Iran-aligned Houthi rebels in Yemen on Saudi oil infrastructure, Middle East Eye reported on Wednesday, quoting Iraqi officials with knowledge of recent secretive Iranian-Saudi talks in Baghdad.Iran is currently negotiating with the signatories to the so-called nuclear deal, as well as indirectly with the United States, to potentially return to the Joint Comprehensive Plan of Action (JCPOA). The U.S. withdrew from the deal in 2018 and slapped sanctions on Iran’s oil exports, which have crippled Iranian crude sales abroad. Despite the U.S. sanctions, Iran has been exporting part of its crude oil, and exports have been estimated at around 500,000 bpd recently.Yet, until the sanctions are in place, Iran is looking for alternatives to have its oil sold on the international markets, and is reportedly looking to negotiate with Saudi Arabia for this. The Saudis, for their part, are looking to end the recent flare-up of attacks on Saudi Aramco oil facilities from the Houthis in Yemen.Saudi Arabia and Iran held direct talks in Iraq last month, the Financial Times reported at the time. The talks reportedly involved the proxy war in Yemen and the recent increase of attacks from the Houthis on oil facilities and oil infrastructure targets in Saudi Arabia.According to Middle East Eye’s sources, Iran and Saudi Arabia held another round of talks in Iraq last week, again focused on the war in Yemen.During the talks last week, Iran “offered to sell it [the oil] to the Saudis at a price lower than international prices on the condition that the Saudis sell it on the world markets in their own way,” a senior Iraqi official close to Iran and familiar with the talks told Middle East Eye. Saudi Arabia demanded an end to the Houthi attacks, and this was their biggest interest in the talks, according to the Iraqi officials familiar with the talks.
Netanyahu’s provocations in East Jerusalem threaten war with Palestinians - Palestinian demonstrators were met once again on Sunday night by Israeli police clad in riot gear and on horseback in a neighbourhood in occupied East Jerusalem where Zionist settlers are seeking to evict Palestinian families from their homes. Sunday’s protests follow days of clashes incited by heavy-handed Israeli repression. Demonstrators also took to the streets of the northern port city of Haifa, where 18 were arrested, as well as Nazareth and Ramallah. There were also clashes with riot police outside the gates of the Hebrew University of Jerusalem, where an attack on a Palestinian by Israeli civilians sparked a protest. The Palestinian Red Crescent reported that 14 people had been treated for injuries suffered at the hands of the Israeli security forces, bringing the total number treated for injuries over the past three days to 560. Prime Minister Benjamin Netanyahu’s government have readied the police and Israel Defence Forces (IDF) in preparation for further clashes with the Palestinians on Monday, when a provocative march by far-right Israeli nationalists is to take place in Jerusalem. Tensions have been mounting in Jerusalem and the occupied West Bank since the start of the month-long Ramadan fast on April 12. The authorities installed barricades around the plaza outside the Damascus Gate, a traditional gathering place during Ramadan for worshippers after prayers in the al-Aqsa mosque, leading to multiple clashes with police and hundreds of injured Palestinians. In addition, the authorities had disconnected the mosque’s loudspeakers so that the call to prayer would not disrupt Israel’s Memorial Day ceremony for fallen soldiers at the Western Wall, and restricted the number of West Bank Palestinians attending Ramadan services at the compound to just 10,000, subject to vaccination. There have been nightly confrontations with the police in Sheikh Jarrah, a Palestinian neighbourhood north of the Old City. Palestinian Israelis have been gathering to protest the likely eviction of Palestinian families, in a long-running legal case, to make way for settler homes and the increasing encirclement of the Old City by Jews. The fascistic and racist legislator Itamar Ben-Gvir, cultivated by Netanyahu in a bid to bolster his support base, sought to fan the flames by setting up his own “office” in the neighbourhood. The Supreme Court hearing on the case, set for today, has been postponed for 30 days at the Attorney General Avichai Mandelblit’s request. The planned eviction is part of the government’s broader process of judaicising the city, making it impossible for the Palestinians to ever set up their own mini-state with some part of East Jerusalem as its capital.
9 children among 20 dead in Israeli airstrike after rocket attack --The Gaza Ministry of Health on Monday said that nine children were among 20 people killed by an Israeli airstrike apparently launched in retaliation for rocket attacks aimed at Jerusalem amid growing tensions between Israeli and Palestinian communities.The Washington Post and The Associated Press reported that the airstrike also killed three Hamas militants, citing Gaza's health ministry. It was one of the deadliest single incidents to occur in recent days as violence has surged around and in Jerusalem.The Pentagon on Monday defended the Israeli airstrike."Today’s rocket attack from Gaza into Israel is unacceptable, and the United States supports Israel’s right to self defense, and here at the department we’re going to continue our cooperation to ensure that Israel has what it needs to defend and project itself," Pentagon press secretary John Kirby said."Obviously we don’t want to see innocent lives taken and nobody wants to see this level of violence but as I said ... these rocket attacks from Gaza are unacceptable."Violence erupted at the Al-Aqsa mosque in Jerusalem over the weekend with videos showing Israeli riot police storming the building as screaming worshippers fled in terror and hundreds were injured. Nearly two dozen officers were also injured by rocks thrown by Palestinian protesters in the same incident, according to Israeli officials. Airborne rocket attacks were aimed at Jerusalem on Monday by Hamas militants in response. It was unclear if there were any injuries or deaths, but one Israeli man was reportedly injured when an anti-tank rocket struck his car in a separate attack according to the Post. The airstrike came as Israel's prime minister, Benjamin Netanyahu, warned that Hamas militants would pay a price for the rocket attacks aimed at Jerusalem hours earlier. “The terrorist organizations in Gaza crossed a red line and attacked us with missiles at the entrances to Jerusalem. Israel will respond with great force," said Netanyahu. “We did not want to escalate, but those who chose to escalate will be hit forcefully.”Tensions have soared in the country for weeks amid Israeli settlement efforts in the Sheikh Jarrah neighborhood, where Palestinian residents say they are being illegally evicted by settlers, a longstanding issue between the two communities.
Israel kills 24 in Gaza as Netanyahu steps up provocations on Jerusalem Day - Israel launched air strikes against Gaza, the besieged Palestinian enclave, killing 24 people including children. Militants had earlier fired a few rockets at southern Israel and the Jerusalem area, in a day characterized by massive violence against the Palestinians in occupied East Jerusalem. Israel’s military announced it had beefed up its forces on its border with Gaza and was suspending a major drill to prepare for a possible escalation. Earlier in the morning, 1,000 security forces stormed the al-Aqsa Mosque compound in East Jerusalem as worshippers were praying, firing stun grenades, tear gas and rubber bullets, while snipers took up positions on rooftops, injuring more than 330 Palestinians. More than 700 Palestinians have been injured in just a few days by Israeli security forces in Jerusalem and across the West Bank. Police locked hundreds of worshippers inside the mosque, prevented doctors and medical teams from entering the compound and attacked and beat up those who sought to help the injured. They forced their way into the compound’s health clinic, where they sprayed pepper gas and lobbed stun grenades at those receiving treatment there. The storming of the mosque, the third holiest site in Islam, provoked angry demonstrations around the country, including in the northern Arab city of Umm al-Fahm and the nearby Wadi Ara, as well as in Jaffa which has witnessed protests over the past week against plans to take over Palestinian-owned houses for a Jewish yeshiva. The crackdown on Jerusalem Day—the anniversary of Israel’s illegal annexation of East Jerusalem, captured from Jordan in the 1967 War—ahead of the planned Flags March by Israel’s settler groups and far right forces through Arab neighbourhoods, was another provocation designed to precipitate a war with the Palestinians.
Israel’s military continues airstrikes on Gaza as it prepares for an “indefinite” operation - On Tuesday, Israel launched a massive aerial bombardment of 140 airstrikes on Gaza, killing a further two Palestinians. This brings the death toll to 33 , including nine children and one woman. At least 122 people have been injured, 41 of them children. More than 12 percent of all injuries were “serious,” according to the Palestinian Ministry of Health. One of Israel’s targets, a 13-storey residential tower in Gaza City that houses an office used by the political leadership of Hamas collapsed. Salameh Marouf, who heads the government information office in Gaza, told Al Jazeera that Israel had “intentionally targeted service facilities, such as near the water desalination facility to the north of Gaza, which put it out of service.” Lt. Col. Jonathan Conricus, Israel’s military spokesman said that 15 militants had been killed in strikes by jets and unmanned drones. He said nothing about the civilian deaths and injuries, adding cynically, “We are doing everything possible to avoid collateral damage.” He reported that the military’s air campaign was still in its “early stages,” implying that assassinations of Hamas leaders were on the agenda. Gaza, home to nearly two million Palestinians, most of whom are under 25 years of age, has suffered a criminal 14-year blockade, three murderous wars—the last in 2014—and numerous assaults at the hands of Israel since 2006. Israel’s latest attacks on Gaza started on Monday night in response to calls by Hamas to withdraw security forces from Jerusalem’s al-Aqsa Mosque compound and Sheikh Jarrah neighbourhood. Israeli Prime Minister Benjamin Netanyahu has on several occasions ordered the deployment of security forces to the al-Aqsa compound, the third holiest site in Islam, during the month-long Ramadan fast that began April 12. None of the authorities have sought to give the slightest justification for Monday’s storming of the compound by security personnel who trampled over prayer mats, attacking worshippers with rubber bullets and stun grenades, injuring 520 Palestinians of whom 330 needed hospital treatment. Police Commissioner Koby Shabtai told Channel 12 News that the police had been “too soft” in dealing with the Palestinians in the compound and that they were going to get tougher.
"Literally Armageddon": 53 Killed In Gaza & 5 Israelis Dead As UN Warns "Full-Scale War" Imminent -- After overnight sustained rocket fire from Gaza and at the same time Israeli airstrikes pounding the strip, the combined death toll reached to at least 50, with hundreds more injured, into Wednesday. International reports are citing over 50 Palestinians killed in Gaza alone, many among these children.Middle East Eye cites the following numbers by late into the afternoon (local time): "At least 53 people have been killed in Gaza since Israel began its bombing campaign in the besieged territory on Sunday morning." "That number, accurate as of Wednesday afternoon, includes 14 children and three women, with a further 320 people wounded with injuries of varying degrees of severity, according to Gaza's health ministry."And on the Israeli side, local reports cite that "three Israeli women were killed in rocket attacks, with more than 50 injured, including two women in serious condition: an 81-year-old as well as a 30-year-old who was hit by shrapnel in her upper body."This takes the death toll on the Israeli side to five since the start of fighting early this week.The IDF announced that 16 among the Gaza dead were militants - some of them "senior commanders" - while also counting "hundreds" of Hamas and Islamic Jihad rockets fired into Israel, many reaching deep into central Israel and scoring direct hits on heavily populated residential areas. Israeli media is reporting that multiple members of Hamas' "General Staff" were eliminated in airstrikes Wednesday: Hamas' rocket response grew in intensity especially after a 13-story apartment building was struck and completely collapsed in on itself. Israel is claiming that it gave the occupants multiple "warnings" to get out before the building was attacked.
Gaza marks deadly Eid al-Fitr amid Israeli bombardment: Live --Palestinian residents of Gaza Strip woke up on Thursday to mark Eid al-Fitr – one of the holiest occasions in the Islamic calendar – amid relentless aerial bombardment by Israel. Heavy bombardment on the Gaza Strip continued early on Thursday as Israeli forces launched a series of air raids on various locations.“Most of Gaza is awake,” Al Jazeera’s Safwat al-Kahlout said, noting that bombardments continue into the night and early on Thursday.“From time to time you hear loud explosions, and the buildings are shaken.”Hamas confirmed that its Gaza City commander, Bassem Issa, was killed in an Israeli air attack along with other senior members of the group. The national security office of Hamas was also reportedly hit again by Israeli strikes early on Thursday. In Gaza City’s Tel al-Hawa neighbourhood, a pregnant woman, Reema Telbani and her child were killed in an Israeli attack on their home. An elderly couple in Gaza’s Sheikh Zayed neighbourhood were also buried under the rubble of their residence, after an Israeli strike.Gaza’s Ministry of Health said the overall death toll since the start of the latest offensive stood at 69, including 17 children and eight women as of early Thursday. More than 390 others have been wounded.Hamas, the group that rules the Gaza Strip, also launched a barrage of rockets into Israel after Israeli missiles destroyed a third tower in the besieged coastal territory.
A Night Under the Bombs in Gaza - We are six people sitting in the living room. Each with a phone in hand and earphones in, following the news of what is happening in Gaza and Jerusalem. The most urgent question on everyone’s mind: where will the next bomb hit? More than 83 Palestinians, among them at least 17 children, have been killed by Israeli bombing on Gaza since 10 May, according to the Palestinian health ministry. Israeli raids have targeted civilian buildings, flattening at least three of Gaza’s high rises and making hundreds homeless. The house feels like it is shaking. At midnight, the sky flares red and my mother nervously tells us to remove our earphones. When we hesitate, she panics and shouts, “Remove them now!” She is afraid the sound of the blaring news and the exploding bombs will harm our ears. Now alarmed ourselves, we all obey, silently looking at each other. My younger sister, Nesma, a lawyer, suggests we all lay down, out of sight, since the light of the shells is reflecting on our uncle’s house next door. Seconds later, our house feels like it is shaking again, and this time the windows and doors join the party. After 15 mins, things are calm again, although we can still hear the drones. Nesma offers to make some tea and I say that I will select some nice music to cover the bombing. We need to calm ourselves as well. I play a love song by Umm Kulthum, the iconic Egyptian singer. Even my father sang! “Oh, my little girls, you reminded me of lovely and beautiful days,” he says. My mother smiles into the book she is reading. Soon, however, the bombing intensifies. Exhausted, my mother tries to catch a little sleep, but to no avail. She is worried about our neighbors, who lost their mother just days ago due to COVID-19. She calls the daughters and chats with them so they won’t be so afraid. But we are all afraid. Still… if the Israeli occupation has taught us anything, it’s how to hide our fears. Panic is contagious. It is a long and tough night. We cannot sleep. Just before dawn, we have our suhur, the meal Muslims eat during Ramadan before starting the day’s fast. This time, it is only dates, some cheese and tea. Because of the bombing, it was not safe to go to the market. We have to buy food daily because the frequent power outages these days make refrigeration difficult. My body is so cold. I don’t know why. The weather is warm, yet I am shivering. Maybe it’s because I am suppressing my worries and fears. I layer on clothes, but it doesn’t bring me comfort. I go to my mother and hug her. I finally feel some peace, although not safe. I put myself to work. First, I rearrange my room so my bed is in the middle – away from any glass that could fly if the windows break. I also open the window and door, to lessen the air pressure and reduce the chance of being hurt by debris. And since I am a fan of the mugs my students give me as gifts, I take them off the shelf so they won’t fall and break. Now maybe my room will ‘survive’. Then I choose movies, music and books that can fill our days if the attacks continue. I also call my friends and arrange to create ‘rooms’ on social media so we can have virtual sleepovers. I also call my sister, who is married and the mother of a lovely newborn boy who has never heard the sounds of bombing before. I want to make sure she and her son, Ibrabim, are ok. At least he is too young to understand what is happening. Finally, and this is very important, I vow to avoid all pictures and videos of the bombing and dead bodies. This is my way of protecting myself from the bad dreams that haunted me during previous wars.
Mounting death toll as Israel’s war on Gaza escalates - Air strikes have continued to pound the Gaza Strip, killing more than 100 Palestinians, among them at least 27 children, and wounding more than 980 people since the start of hostilities. Israel has struck more than 750 targets associated with Hamas, the Muslim Brotherhood-affiliated group that controls Gaza, since the beginning of Operation Guardian of the Walls. These include buildings used by Hamas, its security and intelligence apparatus, banks, and a Hamas naval squad. It has destroyed three high-rise buildings and killed around 60 Hamas operatives, including 10 senior commanders. Israel’s Minister of Defence Benny Gantz glorified the carnage, saying, “We have attacked many hundreds of targets, towers are falling, factories are collapsing, tunnels are being destroyed and commanders are being assassinated.” He declared that military operations in the Gaza Strip would continue until it brings a “complete and long-term peace.” Threatening the Palestinians in a video, Gantz said, “Gaza will burn.” He reminded them that he was Israel Defence Forces (IDF) chief during Israel’s last war on Gaza in 2014. That war killed 2,192 Palestinians, including 1,523 civilians of whom 519 were children, injured tens of thousands more, and destroyed or damaged thousands of homes and much basic infrastructure. Gantz warned, “If Hamas does not stop its violence, the strike of 2021 will be harder and more painful than that of 2014.” On Thursday, Gantz ordered the called up of 16,000 army reservists and sent ground forces to the border in preparation for “all eventualities and an escalation.” IDF spokesperson Hidai Zilberman said that plans for a ground invasion were being prepared and that the IDF had begun an arrest campaign in the West Bank against Hamas members. At least three Palestinians have been killed in clashes with security forces in the West Bank and a further 27 injured as protesters took to the streets. Gaza’s hospitals, already struggling to cope with the pandemic, are battling to care for the wounded amid a shortage of beds, staff, equipment and blood and problems with the power supply. A Red Crescent coordinator said, “The situation here is very difficult, I can’t describe the horror in words.”