Mar 04, 2024

News from the Oil Patch: Texas touts all-time best production in 2023

Posted Mar 04, 2024 8:09 PM
Photo by Pixabay
Photo by Pixabay

Eagle Communications

The Texas patch sets more all-time records despite the December downturn.

Preliminary numbers from energy regulators in the top crude-producing state show total oil production in December dropped by 17 million barrels from November and 28 million barrels year-over-year. But total Texas production for the year 2023 reached 1.87 billion barrels, or 5.13 million barrels per day, the state's best year ever.

Natural gas production also reached an all-time high, according to a news release from the Railroad Commission of Texas, the state's energy regulator.

Kansas Common crude at CHS in McPherson starts the week and the month at $70.25 per barrel after gaining $1.75 on Friday. That's the first time McPherson prices have topped $70 since November. Kansas Common ends the month of February in McPherson with an average price for the month of $66.82 per gallon, an increase of more than$2 over the average in January.

Kansas regulators approved 18 new drilling permits across the state of Kansas last week, running the total so far this year up to 137 new drilling locations, compared to 231 by the end of February last year. There are seven new permits in western Kansas. They include the first two permits filed this year in Ellis County.

Independent Oil & Gas Service reports six newly completed wells in Kansas. That's 159 so far this year compared to 373 a year ago.

The Rotary Rig Count from Baker Hughes was up three oil rigs and down one rig seeking natural gas.  The Kansas Rig Count from Independent Oil & Gas Service was down two, with 13 active rigs in western Kansas.

The week through February 23 boasted the fifth-best Energy Information Administration crude production tally ever. Domestic production ticked up a thousand barrels to 13,332,000 barrels per day. The best-ever output tally, set two weeks ago, was just 7,000 barrels a day higher. Current output is up more than one million barrels per day from a year ago.

The government reported crude oil stockpiles of over 447 million barrels, eight million barrels in just two weeks and about one percent below the five-year average for this time of year. Energy Information Administration says U.S. traders exported 4.7 million barrels of crude oil per day last week, down 237,000 barrels per day from the week before. Four week average exports are 400,000 barrels a day higher than a year ago.

Domestic crude imports averaged 6.4 million barrels per day, down more than a quarter million from the week before. The four-week average is more than two percent higher than last year at this time.

The government says petroleum exports through the Panama Canal rose last month thanks to an easing of that region's extreme drought. Transit volumes through the canal had fallen dramatically late last year.

The Energy Information Administration says natural gas consumption in India is poised to triple in the next 25 years. Energy Information Administration predicts annual consumption growth that's more than double the rate in China, the next-fastest-growing country.

The U.S. Forest Service has withdrawn its decision to allow the Uinta Basin Railway project to cross Forest System lands along the Colorado River. The decision follows an appeals court ruling blocking permits granted by the Surface Transportation Board. The court rejected the board's environmental review, on which the Forest Service relied. The extended rail line would allow oil and gas producers in rural Utah to access existing rail lines along the Interstate 70 corridor to ultimately sell to refineries near the Gulf of Mexico.

The Bakken is far from over, and continues to lead the way with oil field tech developments. That's the word from North Dakota's top energy regulator, Lynn Helms of the Department of Mineral Resources. Helms predicts the state will add one or two drilling rigs this year, and says output could top 1.3 million barrels per day for the first time.

The Bureau of Land Management announced an oil and gas lease sale to offer 31 parcels totaling more than six thousand acres in North Dakota. The sale is set for April 16, with a public comment period set to close March 13.

The world's third-largest crude oil customer is ramping down imports from Russia. India's Petroleum Minister says the country's Russian imports fell in January to a one-year low, down 35% to just short of 1.3 million barrels per day. That's down from nearly 2 million barrels a day in July. India ramped up purchases from Russia when Ukraine sanctions sparked steep pricing discounts in Moscow. The country's Russian imports rose from nothing in January of 2022, to 1.27 million barrels a day a year later. Russia was India's largest crude oil supplier last year. Today they import crude from 39 countries.

Russia will soon ban the export of gasoline to counteract fuel shortages reported across the country. Wholesale gasoline prices in Russia are soaring, due in part to Ukraine's shortages brought on by attacks on Russian oil hubs and refineries. According to local media, Russia will impose a six-month ban on the export of gasoline beginning May 1.

Russia’s oil processing struggled with refinery damage caused by Ukraine’s drone attacks. Russian facilities processed 5.16 million barrels of crude a day in the second week of February, which Bloomberg says is down 94,000 barrels a day from the previous week.

The European Union approved a modest new package of Russia sanctions ahead of the two-year anniversary of the Ukraine invasion. The package is limited in scope as the bloc was keen to see it approved quickly and was focusing much of its effort on trying to enforce existing restrictions.