As the oil market remains in a state of turmoil, Diamondback Energy, Concho Resources and other shale producers are directing their reduced capital budgets to preserving oil production and keeping output declines to a minimum. Continental Resources founder and Chairman Harold Hamm warned that production will not return to a strong growth trajectory unless oil prices climb to $50-$60 per barrel.
BP's plan to reduce its oil and natural gas production by 40% over the next decade as part of its sustainability push does not mean it will pull back from its US shale investments, which remain economically viable, BP Chief Financial Officer Murray Auchincloss said. "We're finding more zones than we thought originally...and obviously, the capital is deflating these days, service rates are down so when we start drilling again, service rates are going to be an awful lot lower," Auchincloss added.
Range Resources has agreed to sell its Louisiana shale assets to Castleton Resources for $245 million and a future contingency payment of $90 million. The value of the transaction represents just a fraction of the $3.3 billion Range paid for the land in 2016.
Pioneer Natural Resources and Devon Energy could start paying variable dividends on top of their regular dividends in the next couple of years, while ConocoPhillips and Concho Resources are also considering similar options. Variable dividends could become an industry fixture as shale producers seek to reward investors and convince them they won't spend too much on drilling when oil prices improve, Tudor, Pickering, Holt & Co analyst Matt Portillo said.
The Bureau of Land Management has given its preliminary approval of an amended environmental review and resource management plan for a proposed 5,000-well oil and natural gas project on federal land in Wyoming. "This proposed amendment would allow for sustainable development of the area's oil and gas resources, while balancing the conservation of wildlife in the area and providing important economic benefits to the State of Wyoming," said the BLM's Casey Hammond.
The Railroad Commission of Texas on Tuesday voted to adopt the industry's proposed changes to the Statewide Rule 32 flaring regulation, which includes a more detailed exception application form for companies that want to flare gas for extended periods. The RRC is accepting public comments on the proposed amendments for 30 days and will make a final decision later this year.
The Colorado Oil and Gas Conservation Commission on Tuesday voted to raise the mill levy on oil and natural gas production -- its primary source of funding -- from 1.1 to 1.5 mills. Lynn Granger, executive director of API Colorado, the state chapter of the American Petroleum Institute, said, "We strongly support the need to fully fund the Colorado Oil and Gas Conservation Commission," but "we have concerns about the impact of this increase during these challenging economic times."
New Mexico's Produced Water Act, which was passed in 2019, "commodifies produced water" and does not adequately protect water resources from the effects of oil and gas drilling, writes Democratic state Sen. Antoinette Sedillo Lopez. "To ensure this water does not contaminate our rivers, streams and aquifers, the statute should require that produced water satisfy federal drinking water standards before it can be reused," she writes.
API Training Course - Virtual Dates Now Available | Spec Q2 Fundamentals and Practitioner
Using practical examples and hands-on application, this course is designed to progressively give you introductory to advanced knowledge of Q2 requirements and interpretations. To learn more about this course and to register, visit the API-U Calendar.
Presented by: Global Corporate Sol., Aug. 20-28; Veritas, Aug. 20-23; Sea&Oil Tech. Services, Aug. 21-24; ABM Solutions, Aug. 24-27; Global Management Sol., Aug. 24-27; AxiomLogics, Aug. 31-Sept. 3; RICI, Sept. 6-9; Aston Technical Consulting, Sept. 14-17; LEED Intl. Training, Oct. 6-9; Mireaux Management Sol., Oct. 20-23.
EVENT | 2020 Virtual Pipeline Conference Webinars, Aug. 5-Sept. 30
We couldn't meet with you in San Diego so API's Midstream Group is bringing the Pipeline Conference to YOU! Beginning in August through September, API will offer 8 tracks comprised of 24 sessions and 3 panel discussions. Registration is required, but there are no registration fees. Find out more.