By JOHN P. TRETBAR
Eagle Media
Crude prices are flirting with the break-even point. NYMEX crude for May delivery settled Friday at $61.50 per barrel. By lunchtime on Monday, prices were lower, but still above $60, which many analysts say is the price point below which they lose money. London Brent was trading a few cents over $64 by midday Monday.
Kansas Common crude at CHS in McPherson starts the week at $51.75 per barrel, after rising $1.50 on Friday. Current prices at CHS are down nearly ten dollars from the first of the month.
Another rupture and spill shut down the Keystone Pipeline, this time near Fort Ransom in southeastern North Dakota. Regulators reported a pipeline employee heard a "mechanical bang" on the morning of April 8 and saw oil emerging near a pumping station. The pipeline was shut down within about two minutes, and the spill was contained to a farm field. The pipeline was recently spun off to a firm called South Bow. The company's Website indicates that US and Canadian regulators have issued orders for corrective action. The accident segment will remain shut down until US pipeline regulators okay a restart. Pressure will be restricted, prior inspection results will be analyzed, and materials testing ordered as investigators look into the root causes.
Keystone has now spilled heavy crude oil at least 22 times in ten years, and at least twice in every state in which it operates, six times in North Dakota, and at least four in Kansas including one in Washington County two years ago.
Crude production dipped slightly from a week ago to 13,458,000 barrels a day. The four-week average is down three-and-a-half percent from a year ago. Cumulative production so far this year dips below 13.5 million.
The government reports commercial crude oil inventories jumped 2.6 million barrels to just over 442 million, or about five percent below the five year seasonal average.
New drilling permits in Kansas total 209 for the year, down from 240 last year. Regulators okayed ten last week with six in Western Kansas. Finney County adds two, raising them to 19 for the year. That's third statewide and tops in Western Kansas. Finney County has, in just two years, jumped from fourth to second statewide in crude production.
Independent Oil and Gas Service reports 8 new completions this week, including one in Stafford County and three in Finney County.
The Kansas Rig Count is down one in Western Kansas at 14 rigs and unchanged east of Wichita at eight active rigs. Drilling continued Friday on a lease in Barton County.
A new government report shows crude exports last year averaged 4.1 million daily barrels, beating the record set the year before. EIA notes export growth slowed to just one percent, from 14% in 2023 and 21% growth in 2022.
The latest weekly export numbers are lower: 3.2 million barrels a day, down 16% from last week, but up more than half a million barrels year-over-year. Crude imports are down a quarter-million daily barrels from a week ago. Four-week average imports drop seven percent.
Baker Hughes reported 583 active drilling rigs last week, noting a drop of nine rigs drilling for oil in the United States. That's the biggest drop in the oil rig tally in two years. The gas count was up one rig. Texas was down three rigs, California and Pennsylvania were each down two, and New Mexico was down one.
Independent Oil and Gas Service lists the top operators based on total footage drilled during the first three months of the year. In Western Kansas, they are Merit Energy, Berexco, Murfin Drilling, American Warrior, and Ritchie Exploration. East of Wichita, that list includes R.J. Energy, Colt Energy, Darrah Oil, Birk Petroleum, and M.L.T. Energy.
The Kansas Independent Oil and Gas Association holds its mid-year meeting next week at the Kansas Star Casino in Mulvane. Meetings, speeches, mixers, and golf run Wednesday through Friday, April 23rd through 25th. The group's annual convention is scheduled for August. You can find more information at www.kioga.org