Archive for the ‘Drilling for oil’ category

Texas to become world’s number 3 oil producer, passing Iran

July 19, 2018

John Sexton Posted at 1:01 pm on July 19, 2018 Hot Air

Source Link: Texas to become world’s number 3 oil producer, passing Iran

{God Bless Texas. – LS}

America is a powerhouse and I mean that literally as well as figuratively. CNN Money reported Wednesday that Texas is set to become the world’s number three oil producer thanks to a boom in production:

Plunging drilling costs have sparked an explosion of production out of the Permian Basin of West Texas. In fact, Texas is pumping so much oil that it will surpass OPEC members Iran and Iraq next year, HSBC predicted in a recent report.

If it were a country, Texas would be the world’s No. 3 oil producer, behind only Russia and Saudi Arabia, the investment bank said.

“It’s remarkable. The Permian is nothing less than a blessing for the global economy,” said Bob McNally, president of Rapidan Energy Group, a consulting firm…

“The industry cracked the code on fracking,” said McNally.

Texas is producing so much oil that it will soon be bumping up against pipeline capacity. Some producers are already selling at a discount because of the limitations. Another problem is a shortage of labor, though that will likely be good news for the state and for people moving to Texas to find work.

The boom in Texas is one reason the U.S. is set to become the world’s number one oil producer. Last week, U.S. production reached an all-time high of 11 million barrels per day:

Reuters reports that if these preliminary numbers are confirmed, the U.S. is currently the second largest producer in the world, just behind Russia:

U.S. crude oil production last week hit 11 million barrels per day (bpd) for the first time in the nation’s history, the Energy Department said on Wednesday, as the ongoing boom in shale production continues to drive output.

The gains represent a rapid increase in output, as the data, if confirmed by monthly figures, puts the United States as the second largest producer of crude oil, just behind Russia, which was producing 11.2 million bpd in early July, according to sources.

“Eleven million would have made us the biggest producer in the world; but actually Russian production in June was above 11 million. So, this is kind of like the space race,” said Sandy Fielden, director of research in commodities and energy at Morningstar.

But we won’t be behind Russia for much longer. The U.S. Energy Information Administration predicted last week that production would near 12 million barrels a day by next year:

EIA forecasts total U.S. crude oil production to average 10.8 million b/d in 2018, up 1.4 million b/d from 2017. In 2019, crude oil production is forecast to average 11.8 million b/d. If realized, the forecast for both years would surpass the previous record of 9.6 million b/d set in 1970. Crude oil production at these forecast levels would probably make the United States the world’s leading crude oil producer in both years.

Of course, gasoline prices are still up a bit thanks to problems in Venezuela and sanctions on Iran. But fracking has made the U.S. the world’s energy powerhouse and that should continue well into the 2020s. This is data the Trump administration should continue to cite as a sign America is resurgent.

Trump Readies Executive Order To Open The Arctic, Atlantic Oceans To Drilling

April 7, 2017

Trump Readies Executive Order To Open The Arctic, Atlantic Oceans To Drilling,  Daily Caller, Michael Bastasch, April 7, 2017

(What will OPEC say? — DM)

Offshore oil rig drilling platform. (Credit: Kanok Sulaiman/Shutterstock)

The Trump administration is developing an order to open new areas to offshore oil and gas drilling, reversing former President Barack Obama’s unilateral decision to lock up most of the Arctic and Atlantic oceans, according to industry sources.

Industry sources familiar with the matter told Platts an executive order is in the works to rewind Obama’s decision to make large swaths of the Arctic and Atlantic off-limits to oil and gas drilling.

Secretary of the Interior Ryan Zinke told industry representatives the new drilling plan would be signed soon, according to Bloomberg. However, he gave few details on what the order could include.

The Department of the Interior’s (DOI) new five-year offshore drilling plan could take years to develop and would replace the Obama administration’s five-year plan finalized in November.

President Donald Trump promised to end Obama-era restrictions on energy production in order to unlock revenue from natural resources and create jobs. DOI raised $275 million in bids in a recent lease auction for the Gulf of Mexico.

Trump is expected to sign the order by the end of April, and it’s sure to draw legal challenges from environmentalists who’ve argued Obama’s indefinite ban on Arctic and Atlantic drilling can’t be overturned.

Obama used Section 12(a) of the Outer Continental Shelf Lands Act, a 1953 law governing offshore drilling, in an unprecedented way, blocking leases in the Atlantic Ocean and the Chukchi and Beaufort seas.

Obama’s order took 125 million acres in Arctic seas and four million acres in the Atlantic Ocean out of future lease sales indefinitely. Supporters said the former president’s actions “permanently” banned drilling in those regions.

But the drilling ban is only permanent if Congress doesn’t change the law or Trump doesn’t move to test it in court. Past presidents have reduced the size of Section 12(a) designations but never fully repealed them.

The U.S.-held portion of the Arctic Ocean is estimated to hold 27 billion barrels of oil and 132 trillion cubic feet of natural gas. The oil and gas industry has struggled to access these vast energy reserves but new discoveries in northern Alaska have reinvigorated some interest in the region.