By JOHN P. TRETBAR
Eagle Communications
Year end statistics show oil and gas activity in Kansas is down by 20% or more from last year. Independent Oil & Gas Service has reported a 20%-plus decline in year-over-year activity comparisons for the last several weeks. IOGSI bases the assertion on total spuds and total footage drilled. The 1,692 well completions reported in 2023 outnumber the tally from a year earlier by 103 wells, but other statistics are lower:
*The list of active operators is shorter, total footage drilled is down 25%, permits and intents are each down 18%.
*Production has been mired at historic lows for about five years. Kansas yearly output dropped below 30 million barrels for the first time in 2020, and has remained there each year since then. Current output reports show production is down from last year, which saw the second-lowest production total in state records. Dwindling Kansas production offers a stark contrast to the dramatic increase in total U.S. output, which continues to rewrite the record-books.
*The end-of-year list of intent-to-drill notices in Barton County shows 40 intents last year, down from 48 a year ago. Ellis County checked in with 44 intents, down from 55 at the end of 2022. Russell County was down seven at ten notices. Stafford County reports 24 intents, down five from the total a year ago.
Operators in Kansas completed 35 wells last week. Eighteen of those were in western Kansas, including one each in Barton, Ellis, and Stafford counties. Kansas regulators report 17 new drilling permits to start the year, 13 in eastern Kansas and four west of Wichita.
The Kansas Rig Count from Independent Oil & Gas Service remained unchanged at 21 rigs in western Kansas. The tally east of Wichita was up two at 16 rigs. The total drops 21% from a year ago. A final look at 2023 shows 1,313 wells spudded, down 388 wells from last year, with total well-bore footage down about 25% year-over-year.
The weekly Rotary Rig Count from Baker Hughes shows 521 active drilling rigs, reflecting an increase of one oil rig and a decline of two seek natural gas. The counts in Texas and Wyoming were each down one rig from a week ago.
Crude prices surged toward a weekly gain in New York and London on Friday. Then on Monday, a selloff dropped prices four percent. By midday Monday, WTI on the Nymex dropped below $71 per barrel. London Brent was under $76. The Energy Information Administration reports domestic crude stockpiles were down 5.5 million barrels last week to end the year at 431.1 million, or about two percent below the five-year seasonal average. Production slips from an all-time record the week before. EIA reports output of 13,235,000 barrels per day in the week ending December 29.U.S. crude imports increased by more than 600-thousand barrels to just under seven million barrels per day. The average over the past four weeks is about seven percent higher than during the same four weeks last year.
Bloomberg is now tracking 14 crude-oil tankers hauling about 11 million barrels of Russian crude to India in violation of international sanctions. In the face of the recent escalation of those sanctions, some of those ships are taking dramatic detours, some are returning to Russia, and some are turning off digital tracking systems.
Southwestern Energy and Chesapeake Energy are close to a merger that would create one of the largest natural gas producers in the country. The Wall Street Journal reports the deal would expand Chesapeake’s gas production in the Marcellus basin in the eastern U.S., and in the Haynesville shale basin on Louisiana and east Texas.