Dunleavy budget forces Legislature to face reality
Andrew Jensen, Anchorage Daily News, December 20, 2018
When former Gov. Bill Walker swooped into the weekly Anchorage Chamber of Commerce luncheon on Nov. 26 the only thing he forgot was a “Mission Accomplished” banner. A week before leaving office, Walker revealed the budget he planned to hand off to incoming Gov. Michael J. Dunleavy (who has traded Mike for Michael J. on official communications since taking office). Walker and his budget director Pat Pitney, since replaced by Donna Arduin, declared the budget for the next fiscal year “balanced” and former Revenue Commissioner Sheldon Fisher promised a “surplus” for the current fiscal year. That’s a stark change from the picture legislators faced last session when the projected deficit for the current year would be about $700 million at a price of $63 per barrel. It also strains credulity.
Our Take: Acknowledging the reality of oil prices is a great first step for Governor Dunleavy! His critics will blame him for the larger deficit instead of pointing out the fantasy land oil price used by the former administration to declare victory. Headlamp predicts lots of fake news coming from his critics over the next four years.
EXXONMOBIL DROPS CANADIAN LNG PLANS
Dale Lunan, Natural Gas World, December 20, 2018
Affiliates of US super-major ExxonMobil revealed December 19 they have withdrawn their 30mn metric tons/year WCC LNG Project near Prince Rupert, on BC’s northern coast, from a provincial environmental review process, effectively ending the project. In a December 5 letter to Nathan Braun, executive project director with the oil and gas sector of the BC Environmental Assessment Office (EAO), Scott Pinhey, vice-president of WCC LNG Project, requested that, “as per recent discussions”, the project be withdrawn from the EAO’s existing environmental assessment process. A similar request was also to be made to the Canadian Environmental Assessment Agency (CEAA), Pinhey’s letter said. WCC LNG Project is a Canadian corporation owned by ExxonMobil Canada and Imperial Oil, affiliates of US-based ExxonMobil. Consisting of up to five barge-mounted liquefaction units each rated at 6mn mt/yr, the project was to have been located at Tulk Inlet, within the corporate limits of Prince Rupert.
Oil Demand Flashes Red, Sending Crude Prices Even Lower
Georgi Kantchev, The Wall Street Journal, December 20, 2018
It isn’t just that there is too much oil sloshing around the world. All of a sudden, there are fears of too little demand for the stuff too. Oil prices continued to tumble Thursday, falling as much as 4%, with Brent crude, the international benchmark, falling to its lowest levels in 15 months. The U.S. benchmark, West Texas Intermediate, traded for $46.61 early Thursday and is down almost 40% since a high in October. The vertiginous decline in oil prices has been largely attributed to an oversupply shock of oil, caused by U.S. shale production, timid production cuts by OPEC nations and generous sanctions waivers by the U.S. for Iranian oil. But also creeping into the picture: the demand side of the crude equation is starting to flash red. Some analysts say oil demand next year could grow at its slowest pace in eight years.
BP launches $3 billion sale of U.S. onshore assets to fund BHP deal: sources
Ron Bousso, Clara Denina, David French, Reuters, December 19, 2018
Britain’s BP has launched the sale of U.S. oil and gas onshore assets that could raise more than $3 billion to help pay for other fields in the United States it bought in October from BHP (BHP.AX), industry and banking sources said. The sale proceeds will partly fund the $10.5 billion acquisition of BHP’s onshore assets that are mostly around oil-producing fields in Texas and Louisiana. BP had said it would sell $5 billion to $6 billion to finance the deal. The London-listed firm wants to focus on production from its holdings in the Permian and Eagle Ford basins to match rivals Exxon Mobil (XOM.N) and Chevron (CVX.N) whose production there is set to rise sharply in coming years.
Exxon Mobil opposes weakening Obama-era emissions rules in letter to EPA
Reuters, December 18, 2018
Exxon Mobil Corp filed a letter with the U.S. Environmental Protection Agency on Monday in support of methane gas emission rules put in place under the Obama administration. The Trump administration in September proposed weakening requirements for repairing leaks of the greenhouse gas in drilling operations in a step toward rolling back an Obama-era policy to combat climate change. (Reporting by Jennifer Hiller Editing by Tom Brown)
ConocoPhillips backs carbon tax plan
Timothy Cama, The Hill, December 17, 2018
Oil and natural gas giant ConocoPhillips Co. is backing an effort to impose a tax on carbon dioxide emissions. The company is pledging $2 million over the next two years to Americans for Carbon Dividends, an advocacy group that pushes a carbon tax, starting at $40 and rising thereafter, as part of a plan developed by the Climate Leadership Council (CLC) and its leaders, former Republican secretaries of State James Baker III and George Shultz. ConocoPhillips, the nation’s second largest oil producer, is also joining the Climate Leadership Council. Exxon Mobil Corp., the country’s largest oil company, joined the effort in October, and BP and Royal Dutch Shell were already onboard.
From the Washington Examiner’s Daily on Energy:
REPUBLICAN EPW COMMITTEE LEADER CALLS FOR CLIMATE ACTION, BUT NOT A CARBON TAX: Sen. John Barrasso, R-Wyo., on Tuesday called for action to combat climate change, but said pricing carbon is the wrong way to do it.
Barrasso, the chairman of the Senate Environment and Public Works Committee, wrote an op-ed in the New York Times in which he says government support for innovation is the best strategy, not regulations or global agreements like the Paris accord.
“The climate is changing and we, collectively, have a responsibility to do something about it,” Barrasso said. “Innovation, not new taxes or punishing global agreements, is the ultimate solution.”
The innovation he would support: Barrasso points to proposed legislation supporting development in the nuclear sector on advanced reactors, and in carbon capture technology to trap emissions from coal and natural gas plants.
Is it enough? Barrasso’s call for action is notable, considering his stature, and past history of avoiding the subject of climate change.
But while a recent report by the United Nations says innovation in the power sector has been crucial to driving down U.S. emissions, it warns a comprehensive policy like a carbon tax is necessary to avoid the worst outcomes of climate change.
US ‘streamlines’ LNG export reporting
Kathrine Schmidt, Upstream Online.Com, December 19, 2018
The US Department of Energy said on Wednesday it would lessen reporting requirements for liquefied natural gas exports, now only requiring LNG exporters to report the country of delivery of cargoes, not the ultimate destination. The DOE said it opted to make the change to the requirement given the “complexity” of some transactions and ” the challenges associated with tracking LNG exports all the way to their point of end-use.” Still, LNG exporters are required to uphold existing current ban on sending LNG exports to sanctioned countries. “…It is imperative that US LNG companies have all the tools they need to get their American product into the international market,” said US Secretary of Energy Rick Perry.
Dunleavy weighs fate of $43 billion gas line plan
Alex DeMarban, Anchorage Daily News, December 16, 2018
It’s the $43 billion question for Gov. Mike Dunleavy: What to do with the Alaska LNG megaproject? For now, the new governor wants to learn more about it before setting a course. “(Dunleavy) will withhold judgment on this or any project until he and his administration can fully understand the costs, risks, and potential benefits,” said Brett Huber, his senior policy adviser.
Our Take: In the words of Governor Parnell “What’s important now is getting something of value to the state for all the time and money (invested)”
Embattled US Interior secretary, who championed expanded Arctic oil development, resigns abruptly
Yereth Rosen, Arctic Today, December 18, 2018
Interior Secretary Ryan Zinke, who has spent his two years in office pushing for new oil development across Arctic Alaska’s lands and waters, is leaving his post amid a series of investigations into alleged corruption and ethics breaches. Zinke, in a statement, blasted what he said were “fictitious allegations” against him. “I love working for the president and am incredibly proud of all the good work we’ve accomplished together. However, after 30 years of public service, I cannot justify spending thousands of dollars defending myself and my family against false accusations,” he said in the Dec. 15 statement. The resignation is effective at year’s end. Alaska political leaders lauded Zinke for his work to expand oil development in Alaska, especially the state’s Arctic regions.
From the Washington Examiner, Daily on Energy:
A GREEN NEW DEAL WOULD NECESSITATE A HUGE INCREASE IN MINING: Moving the world to 100-percent renewable energy under a Green New Deal, or the Paris climate accord, will require at least a twelvefold increase in the not-so-green practice of hardrock mining, according to a new study backed by prominent environmental consultants.
“The current global supply of several critical metals is insufficient to transition to a renewable energy system,” a new study released Thursday by Leiden University in the Netherlands and environmental consulting firms Metabolic and Copper8 concludes.
Specifically, the demand for so-called “rare earth metals” such as neodymium, terbium, dysprosium, and praseodymium stands out as a potential problem for moving to a global energy system dominated by renewables. The metals are needed for manufacturing solar panels and wind turbines, among other uses. And that estimate does not include increasing demand for other electronic goods like electric cars and iPhones, which also require the same metals, the study said.
Our Take: A twelvefold increase in hardrock mining is great news for Alaska!
Independent Rep. Ortiz is calling on fellow legislators to get on board with Rep. Knopp’s bipartisan coalition
Matt Buxton, The Midnight Sun, December 13, 2018
The Alaska House’s sole independent legislator to survive the 2018 elections, Ketchikan’s Rep. Dan Ortiz, is urging fellow legislators to consider joining the bipartisan coalition proposed by Kenai Republican Rep. Gary Knopp. Ortiz sent a letter to legislators this morning outlining his support for working across party lines. A copy of the letter was provided to The Midnight Sun, and Ortiz has not yet been available to respond to our request for comment.
Our Take: Rubbish. Quoting Senator McCain and Abraham Lincoln tells Alaskans nothing about what this bipartisan coalition will focus on. Ortiz was part of the more revenue, more spending on government majority in the last session while Knopp was part of the minority that was focused on less government spending and no new taxes. Tell Alaskans how you plan to bridge that great divide and why it will be good for Alaska.
Asia’s Big LNG Buyers Need More Contracts: WoodMac
Mark Smedley, Natural Gas News, December 13, 2018
Uncontracted demand by the world’s seven largest LNG buyers could quadruple to 80mn metric tons/yr by 2030, forecasts consultancy Wood Mackenzie. The seven – CNOOC, CPC of Taiwan, Japan’s Jera, South Korea’s Kogas, PetroChina, Sinopec and Tokyo Gas – together account for more than 50% of the global LNG market. After a number of quiet years, these northeast Asian buyers (three of which are Beijing-based) have resumed global LNG contracting activity, with over 16mn mt/yr contracts announced this year. WoodMac research director Nicholas Browne said China’s quest for a lower-emission economy means its demand for gas and LNG has grown significantly, a trend that would continue.
Our Take: Good news for Alaska LNG.
Craig Medred, December 12, 2018
Alaskans embracing the idea of Chinese investment in a massive, $44 billion project to transport natural gas from the North Slope to Cook Inlet and liquefy it for shipment to Asia might want to take a close look at what is happening to the south – far, far to the south. The South American country of Ecuador hooked up with China to further resource development – most especially oil – almost a decade ago. And now, the Los Angeles Times reports, the country is “straining under a huge budget deficit caused partly by obligations to the Chinese, whose loans financed roads, dams, schools and office buildings.”
Our Take: Alaska LNG – proceed with extreme caution when dealing with China.
Arctic reserve lease sale draws limited interest, but one new company
Elwood Brehmer, Alaska Journal of Commerce, December 13, 2018
Interest in National Petroleum Reserve-Alaska oil and gas acreage was tempered again this year, with federal officials citing a lack of access to the most promising areas as a reason for the modest bidding. Overall, the Bureau of Land Management received 16 bids over 16 oil and gas leases covering 174,044 acres, Acting BLM Alaska Director Ted Murphy said during the Wednesday morning bid opening in Anchorage. The bids, ranging from $57,000 to $216,000 per lease, netted a total of $1.13 million, half of which will go to the State of Alaska through revenue sharing. The state lease revenue from the federal reserve is then first available for allocation to a grant program aimed at reducing the impacts of development on North Slope communities.
US House chairman calls for anti-OPEC bill to become law this year
S & P Global Platts, December 12, 2018
The chairman of the US House Judiciary Committee Wednesday called on the Trump administration to back a bill that would allow the US Department of Justice to sue OPEC for antitrust violations. “The fact that OPEC is not being held accountable for its anti-competitive behavior makes a mockery of US antitrust law,” Representative Bob Goodlatte, the committee’s chairman and a Virginia Republican, said at a subcommittee hearing. Goodlatte said that passage of the No Oil Producing and Exporting Cartels or NOPEC Act, would be a “bipartisan victory before this term of Congress ends.”
EPA sees no new coal plants from its CO2 rule, but it could still help industry
S & P Global Market Intelligence, December 13, 2018
Looser carbon dioxide limits for new coal-fired power plants unveiled by the Trump administration are unlikely to spur construction of any new coal-fired power generation on their own but could be a crucial piece of a broader strategy in the president’s bid to revive coal. The U.S. Environmental Protection Agency’s proposed rule aims to “ensure any new coal plants built in the United States use the most advanced, clean coal technologies that have been adequately demonstrated.” While the industry said the Obama-era limit essentially outlawed the construction of coal plants without cost-prohibitive carbon capture technology, the Trump administration’s proposal moves the bar to a level already achieved by several coal plants running today.
Oil Majors Cautious but Upbeat About 2019
Irina Slav, OilPrice.Com, December 11, 2018
After Chevron last week said it will increase its capex for 2019 for the first time in four years, this week two more oil majors joined the ranks of optimists in the oil industry: although they are not raising their budgets in any significant way. Hess Corp. and ConocoPhillips both expect to perform better next year. Conoco issued a statement presenting its spending plans on Monday, saying it would allocate US$6.1 billion for capital expenditures, expecting production of between 1.3 and 1.35 million bpd, excluding Libya, versus 1.356 million bpd in 2017, also excluding Libya. However, the 2015 figure would be higher than the latest quarterly production figure available from Conoco: the company said in its third-quarter report it produced 1.224 million bpd of crude.
Will China Turn Its Back on U.S. LNG?
Vanand Meliksetian, OIlPrice.Com, December 11, 2018
There was a sigh of relief from global markets when the leaders of China and the U.S. met on the side-lines of the G20 summit to agree upon a temporary truce in their trade war. However, despite the good news, the existing 10 percent tariff on U.S. LNG has remained unchanged. According to White House Spokeswoman Sarah Sanders, China had agreed to immediately start importing more U.S. agricultural, energy, industry, and other products. The arrest of Huawei CFO Meng Wanzhou in Canada, however, is set to be the first test of this new truce.
Our Take: We hope not. China is the single biggest oil and natural gas consumer on the planet.
From the Washington Examiner, Daily on Energy:
JOE MANCHIN ELEVATED TO TOP DEMOCRAT ON ENERGY COMMITTEE DESPITE GREEN CRITICS: Sen. Joe Manchin of West Virginia, a vocal supporter of the coal industry, was officially tapped Tuesday to be the top Democrat on the Senate Energy and Natural Resources Committee next Congress.
Senate Minority Leader Chuck Schumer, D-N.Y., announced Manchin’s rise to ranking member status Tuesday afternoon, a move that environmental groups had dreaded.
Environmental groups had urged Schumer to block Manchin from leading Democrats on the committee, which has oversight of key energy programs that relate to climate change.
But Schumer feared setting bad precedent about Democratic seniority rules.
Manchin promises neutral approach: In a statement, Manchin vowed Tuesday to work with senators of both parties on an “all-of-the-above” approach to energy. He did not mention climate change. Manchin last week dismissed environmental groups critical of his green credentials, telling reporters, “I don’t think they’re senators.”
How he came to power: The spot opened for Manchin because the current energy committee ranking member, Maria Cantwell, D-Wash., is switching to be the top minority senator on the Commerce Committee, a transition that Schumer also made official Tuesday.
Other liberals with seniority over Manchin on the Energy and Natural Resources Committee have said they are not interested in taking over, including Sen. Bernie Sanders, I-Vt., the former presidential candidate and proponent of action to combat climate change, who is keeping his ranking member role on the Budget Committee.
GOP welcomes him: Sen. Lisa Murkowski, R-Alaska, the committee chairwoman, said Wednesday she looks forward to working with Manchin.
“I’m excited to work with him in his new capacity as we continue our committee’s tradition of advancing good, timely, bipartisan legislation for our nation,” Murkowski said.
Dunleavy among new leaders to meet with Trump
Associated Press, December 10, 2018
Officials in Gov. Dunleavy’s office say he will be meeting with President Donald Trump on Thursday. Officials said Monday that Dunleavy and 12 other newly elected governors and territorial governors will participate in the Washington, D.C., meeting. Dunleavy says in a statement that the meeting is the “first of many opportunities to work in concert with the President and federal officials on advancing my administration’s priorities, like bringing new jobs and investment to Alaska.”
Our Take: Headlamp predicts that these two will get along well and work together to forge a path to America’s energy dominance through Alaska. #huge #winning
Judge dismisses challenges to oil lease sales in the National Petroleum Reserve-Alaska
Elizabeth Harball, Alaska’s Energy Desk, KTOO, December 10, 2018
A federal judge in Anchorage has dismissed two lawsuits brought by environmental groups against the Trump administration challenging oil lease sales in the National Petroleum Reserve-Alaska, or NPR-A. Environmental groups had argued the federal Bureau of Land Management did not do an adequate environmental review before it held oil lease sales in 2016 and 2017. In one of the lawsuits, the groups also argued the federal government failed to fully consider how oil produced in the 23-million acre Reserve could worsen climate change. The federal government argued it did complete an extensive environmental review for oil leasing in the Reserve under the Obama administration, as part of a management plan for NPR-A finalized in 2013. The Trump administration is currently considering an overhaul of that management plan.
Our Take: Good to see a federal judge acknowledging the extensive work that is done on environmental reviews prior to a lease sale.
EIA Expects US LNG Capacity to Double in 2019
Natural Gas News, December 10, 2018
The US Energy Information Administration (EIA) said December 10 it expects US LNG export capacity to more than double in 2019 as a raft of new liquefaction trains come on-line through the year. The US is home to 3.6bn ft3/day (37.2bn m3/yr) of LNG export capacity now, the EIA says in its latest Today in Energy report, and that is expected to increase to about 4.9bn ft3/day by year-end as new trains enter commercial operation at Cheniere Energy’s Corpus Christi terminal in Texas and its Sabine Pass terminal in Louisiana.
Bank of America sees oil gains in 2019, but that forecast is far from universal
Natasha Turak, CNBC, December 11, 2018
Despite dramatic slides in the oil market, some forecasters remain positive on prices and demand going into 2019. A year ahead outlook report from Bank of America Merrill Lynch expects Brent crude to regain its recent losses in 2019 and settle at $70 a barrel. But amid mounting global uncertainty on everything from trade and monetary policy to politics, that forecast is far from consensus. “Volatility will be high in the near future, but going into 2019, we are constructive on oil prices,” Hootan Yazhari, head of global frontier markets equity research at Bank of America Merrill Lynch, told CNBC’s Dan Murphy on Tuesday
U.S., China Kick Off a New Round of Trade Talks
Bob Davis and Lingling Wei, The Wall Street Journal, December 11, 2018
The U.S. and China started the latest round of trade talks with a phone call involving Treasury Secretary Steven Mnuchin, U.S. Trade Representative Robert Lighthizer and Chinese Vice Premier Liu He. The three senior officials discussed Chinese purchases of agricultural products and changes to fundamental Chinese economic policies during the phone call, said people familiar with the conversation. They didn’t provide further details. As part of the trade truce reached between Mr. Xi and Mr. Trump, Chinese officials are also considering making changes to the Made in China 2025 plan, a state-led industrial policy aimed at enabling Chinese companies to dominate a number of industries such as artificial intelligence and robotics, said people familiar with the matter. The policy is a focal point of the U.S.’s complaints that Beijing engages in unfair trade practices that put foreign firms at a disadvantage to Chinese companies.
ConocoPhillips eyes output hike with $6.1bn spend
Eoin O’Cinneide, Upstream Online, December 10, 2018
ConocoPhillips is looking for a sizeable rise in production next year but has elected to keep capital expenditure flat at $6.1 billion. The US independent is to target its Lower 48 unconventional plays as well as operations in Alaska, although Europe and North Africa are still to get around $700 million of the expected spending pot. Of the $6.1 billion total – the same mark at which ConocoPhillips expects to exit this year – $3.1 billion will go on the Lower 48, where the company expects to operate an average of 10 or 11 rigs between its big three core shale areas of the Bakken, Eagle Ford and Delaware sub-basin of the Permian. Another $1.2 billion or so will go on Alaska, up from $900 million this year, with costs at the recently-sanctioned Greater Mooses Tooth-2 (GMT-2) development accounting for some of the rise.
Our Take: This is such great news for Alaska. A stable business climate with the right tax structure allows this to happen. See the next story.
Striking out on his own, legislator hopes to charter new coalition in the Alaska House
James Brooks, Anchorage Daily News, December 9, 2018
Kenai Republican Rep. Gary Knopp on Saturday formally announced that he will not join a Republican-led majority in the Alaska House of Representatives. The move denies Republicans the 21-member support needed to control the House and leaves the body adrift less than one month before the Legislature convenes Jan. 15. Speaking by phone from the Kenai on Sunday, Knopp said the prospective Republican majority, a result of November’s general election, was unsustainable, and he is attempting to force a compromise in order to avert a collapse in the middle of the legislative session. “I can’t think of anything worse than going down there to implode in the middle of session.,” Knopp said. While Republicans control 23 of the 40 seats in the Alaska House, only 21, including Knopp, had pledged their support to the majority that intended to replace last year’s predominantly Democratic coalition. The remaining two — Rep. Louise Stutes of Kodiak and Rep. Gabrielle LeDoux of Anchorage — were members of the coalition and have kept their distance from the new Republican group.
Our Take: Headlamp is disappointed in Rep. Knopp. His actions could give power in the House to those who believe in a “keep it in the ground” philosophy and who consistently propose legislation that is harmful to Alaska’s economy.
India’s Petronet looking for long-term deal to buy U.S. LNG
Nidhi Verma, Reuters, December 10, 2018
Top Indian gas importer Petronet LNG is looking to sign a deal in a year’s time to buy at least 1 million tonnes of U.S. natural gas annually for a period of up to 10 years, as it pushes to diversify its supply sources beyond the Middle East. As part of any deal, the firm could potentially take a stake in a U.S. liquefied natural gas (LNG) project, said Petronet’s managing director, Prabhat Singh. “The U.S. market is open compared to other markets where the state is (often) the controller of minerals,” Singh told Reuters late last week. “The U.S. offers lots of opportunities and we would like to explore that properly and make a venture (there),” he said.
Why greens are turning away from a carbon tax
Zack Colman and Eric Wolff, Politico, December 9, 2018
This month’s fuel-tax riots in Paris and the defeat of a carbon-fee ballot measure in Washington state show the difficulty of getting people to support a levy on the energy sources that heat their homes and power their cars. Meanwhile, even the most liberal Democratic candidates this year gave carbon taxes scant if any mention in their climate platforms, focusing instead on proposals like a phaseout of fossil fuels and massive investments in wind and solar power
From the Washington Examiner, Daily on Energy:
RICK PERRY SEEKS ALLIANCE WITH FORMER OPEC ALLY AND NATURAL GAS RIVAL QATAR: Energy Secretary Rick Perry visited Qatar over the weekend to form a new relationship with the largest exporter of natural gas in the Middle East soon after the country announced it would be leaving the OPEC oil cartel.
Perry called his meeting with Qatar’s energy minister a productive discussion, meant to hone a new relationship on energy.
“Had a productive visit with Qatari Minister Al Kaabi where we discussed our strategic relationship on energy cooperation as world leaders in natural gas and the need for free, fair, and diverse markets to promote energy diversity,” Perry tweeted on Saturday.
The U.S. became a net natural gas exporter last year, with sizable new gains in shipping shale-based gas into the global market. The U.S. also became the largest energy producer this year, claiming leadership from Russia and Saudi Arabia in an increasingly competitive year.
Qatar announced earlier this month that it would be leaving the global oil cartel OPEC, finding it more advantageous to strike out on its own. The country has been at odds with neighbor Saudi Arabia, who accused it of fomenting terrorism and initiated a diplomatic and economic blockade against it.
Trump had initially supported the Saudi-led blockade, but later invited the leader of Qatar to the White House where he praised him as a friend.
Although Qatar is a rival of the U.S. when it comes to natural gas production and exports to Asia, the country is looking at making energy investments in the United States.
U.S. Coast Guard chief optimistic about icebreaker ship funding
Timothy Gardner, Reuters, December 7, 2018
The United States may soon get funding for a new heavy icebreaker ship, the head of the U.S. Coast Guard said on Thursday. The United States has two polar-capable operational icebreakers — a heavy one, the Polar Star, which is more than 42 years old and has outlived its life expectancy by a dozen years, and a medium one designed for research, the Healy. By comparison, Russia has about 40 to 50 icebreakers, purpose-built vessels that can rescue other ships, supply bases, and reach oil spills in harsh polar conditions. “I’m guardedly optimistic funding for that first polar security cutter is going to be there,” Commandant Karl Schultz said at a National Press Club event. Icebreakers support scientific missions and operate in the Arctic and Antarctic, which hold vast natural gas, oil, mineral, fish, and freshwater resources, Schultz said.
China to Have 68 LNG Terminals in Five Years
Natural Gas News, December 7, 2018
China is likely to have 68 LNG receiving terminals in the next five years, more than three times the current number, Guo Zonghua, president of leading state-owned think-tank Shaanxi Gas Design Institute said at an event November 30. He said that at present, there are 20 LNG receiving stations in China, with a further 20 are under various stages of construction. There are 28 projects that have been proposed. So, China will probably have 68 LNG receiving stations in the next five years, he said.
A Trade Detente Would Fuel The U.S. Energy Sector And China’s Environment
Ken Silverstein, Forbes, December 5, 2018
Donald Trump’s trade war with China is causing uncertainties in both the financial markets and the overall economy. To that end, the U.S. oil and natural gas sectors could get seriously hurt unless both sides can save face or one side folds. Economists agree on almost nothing — except that free and fair trade produces better business and healthier economies. And that axiom especially holds true when it comes to the relationship between the United States and China, considering that the Asian nation is the second biggest economy in the world and that it is a voracious consumer of oil and natural gas. In fact, the two economies are inextricably linked to the import-export markets.
Oil Soars After OPEC And Partners Reach Deal
Tsvetana Paraskova, OilPrice.Com, December 7, 2018
Oil prices shot up on Friday after the stubborn holdout Iran agreed to have OPEC reduce oil production by a total of 800,000 bpd, while non-OPEC nations, led by Russia, are reportedly adding another 400,000 bpd of cuts, for a total of 1.2 million bpd OPEC+ production cut. At 09:31 a.m. EDT on Friday, WTI Crude was soaring 3.73% at $53.41, while Brent Crude was surging 4.15% at $62.55. As the talks began on Friday, reports emerged that Russia may be ready to cut its oil production by 200,000 bpd as part of a deal with OPEC to reduce oil supply—a higher commitment than 150,000 bpd previously aired.
USGS: Permian’s Wolfcamp is largest potential oil and gas resource ever assessed
Jordan Blum, Houston Chronicle, December 6, 2018
The Permian Basin’s Wolfcamp and Bone Spring formations in West Texas and New Mexico hold the most potential oil and gas resources ever assessed, the U.S. Interior Department said Thursday. The region in the Permian’s western Delaware Basin holds more than twice as much oil as the largest previous assessment – the Wolfcamp shale in the Permian’s separate Midland Basin southeast of Midland. That study was completed two years ago. To put the new results into perspective, the Delaware Basin’s Wolfcamp and Bone Spring plays would hold almost seven times as much oil as North Dakota’s Bakken shale.
From the Washington Examiner, Daily on Energy:
TRUMP’S COMING POWER PLAY ON OBAMA WATER REGS: The Environmental Protection Agency plans to roll out early next week its proposal to weaken landmark Obama-era changes to the regulation of waterways.
“The previous administration’s 2015 rule wasn’t about water quality,” reads a talking points memo obtained by the New York Times ahead of next Tuesday’s announcement. “It was about power — power in the hands of the federal government over farmers, developers and landowners.”
Woe unto WOTUS: The new rule is Trump’s version of the Clean Water Rule, also known as the Waters of the United States rule, which became a GOP target after the previous administration used it to extend the EPA’s enforcement authority over both large and small bodies of water, including small tributaries and drainage ditches.
The Trump rule would shrink Obama EPA’s definition of a waterway to include only larger bodies of water, excluding smaller waterways that feed into them, according to environmental groups tracking the issue.
Environmentalists are gearing up to fight hard against the proposed regulation, which will undergo a public comment period beginning later this month, according to the Times.
US is well on its way to Trump’s goal of ‘energy dominance,’ says Marathon Petroleum CEO
Elizabeth Gurdus, CNBC, December 5, 2018
President Donald Trump’s goal of making the United States a global superpower in energy is starting to come true, Marathon Petroleum Corp. Chairman and CEO Gary Heminger told CNBC on Tuesday. “When I look at the president’s theme to begin with and the beginning of his administration, he wanted to have energy dominance in the U.S. and I believe that we are well on our way,” Heminger told Jim Cramer in an exclusive “Mad Money” interview. “We’re the largest producer in the world today.” Recent declines in oil prices haven’t stopped U.S. producers from pumping more oil ahead of OPEC’s meetings later this week, at which the group of oil-exporting countries are expected to cut production.
OPEC tentatively agrees to oil cut, waits for Russia to commit
Rania El Garmal, Ahmad Ghaddar, Reuters, December 6, 2018
OPEC tentatively agreed to an oil output cut on Thursday but was waiting for a commitment from non-OPEC heavyweight Russia before deciding the exact volumes for a production reduction aimed at propping up crude prices, two sources from the group said. Russian Energy Minister Alexander Novak flew home from Vienna earlier for talks with President Vladimir Putin in St Petersburg. Novak returns to the Austrian capital on Friday for discussions among Saudi-led OPEC and the group’s allies. The price of crude has fallen almost a third since October, but U.S. President Donald Trump has demanded the Organization of the Petroleum Exporting Countries make oil even cheaper by refraining from output cuts.
From the Washington Examiner, Daily on Energy:
CONSERVATIVE GROUPS SURVEY SHOWS MIDTERM VOTERS WANT ACTION ON CLEAN ENERGY: A post midterm-election survey conducted by conservative groups shows a majority of voters want to see action on legislation to promote clean energy.
The survey released Thursday by Citizens for Responsible Energy Solutions Forum and the Conservative Energy Network found that 68 percent of voters surveyed say that the issue of clean energy was important to their vote in 2018, and even bigger majorities say they would support candidates who support clean energy.
“These survey results represent what we have seen time and time again—that voters understand the benefits of clean energy policy and they want action,” said CRES Forum Managing Director Heather Reams.
The survey was completed November 8‐12, 2018, among 800 respondents who voted in the 2018 election.
Our Take: Clean energy = natural gas. We’ve got it. They want it. Good.