News From The Oil Patch 8/25/2014
Baker Hughes reported 1,896 active drilling rigs across the US on Friday, down 17 for the week. The count in Canada was 405, up four. There were 28 in Kansas, up two. Independent Oil & Gas Service reported 123 total rigs in Kansas. That's 39 east of Wichita, up one, and 85 in western Kansas, down two.
Independent Oil & Gas reported 138 new drilling permits issued last week across Kansas, for a year-to-date total of 4,792. There were 76 drilling permits issued for new locations in eastern Kansas, and 62 west of Wichita, including four in Barton County, one in Ellis County, two in Russell County, and three in Stafford County.
There were 68 new well completions reported last week statewide, which is 3,715 so far this year. That includes 21 east of Wichita, and 47 in western Kansas, including one in Barton County.
The gap between crude oil prices in the major trading centers of Midland, Tx and Cushing, Ok ballooned to nearly $20 ast week, the widest point this year and second-highest on record. This is due at least in part to the skyrocketing production in the West Texas Permian Basin, which has grown pipeline and rail capacity in the region. The resulting supply backlog is forcing prices down.
BP was the apparent high bidder on 27 of 32 bids it submitted at that Western Gulf of Mexico lease sale. That's an 84% success rate, on total bids accepted of more than $22.8 million. Shell won the bidding on one block. The total amount of high bids on all 81 tracts was nearly $110 million.
Plains All American Pipeline announces on its Web site its plan to construct a 440-mile pipeline connecting the storage hub at Cushing with the Valero refinery in Memphis, Tennessee. The $900 million project should be completed in a couple of years and will move about 200,000 barrels per day of domestic sweet crude oil from Cushing to Memphis.
Libya said Wednesday it was resuming oil exports from its largest terminal after a year-long stoppage, as its oil industry manages to recover despite intense fighting in large cities. But new uncertainty emerged later in the day as Libya's de facto oil minister said he was being replaced. An Italian super tanker was set to leave later Wednesday from the terminal with about 600,000 barrels on board.
A 15-mile section of the Ohio River was reopened for limited traffic on Wednesday as clean-up of a 5,000-gallon fuel oil spill continued, the U.S. Coast Guard said on Wednesday. The Coast Guard closed a stretch of the river between Cincinnati, Ohio and Dayton, Kentucky on Tuesday after a spill during a "routine transfer of fuel oil" at a 60-year-old power plant owned by Duke Energy, 20 miles east of Cincinnati.