BP Announces It Will Cut Oil and Gas Production 40 Percent
Building on its February presentation on climate change, BP announced today that it expects to cut the amount of oil and gas it produces by 40 percent by the end of the decade as part of its pledge to emit no net global warming emissions by 2050. The company provided few details back in February, but has promised to outline a comprehensive plan at its Capital Markets Day in September.
Buffet Bets $10 Billion On Natural Gas
Warren Buffet stayed quiet during the beginning of the pandemic, which was a change from the norm as he typically would buy up distressed assets. That changed when he purchased natural gas (UNG) from Dominion Energy (D).
The spread of the coronavirus silenced Buffett for months. He emerged in July when he purchased the natural gas transmission and storage assets of Dominion Energy (D) for $4 billion. Including debt, the deal totaled a $10 billion investment.
Berkshire will now own 18% of all interstate natural gas transmission in the United States, up from its previous holdings of 8%. Dominion sold its Atlantic Coast Pipeline and transmission assets. The company remains an energy producer. Buffett has given natural gas a vote of confidence with the purchase at a time when the price is languishing below $2 per MMBtu and after hitting a quarter-of-century low at $1.432 in late June. Warren bought natural gas cheap, but time will tell if the investment pans out.
International Culture Impacting Shale Play USA
Luke Daniels, Core Well Commercial Capital, explains how there are many international companies buying up US mineral rights, services companies and land parcels, creating new culture integration and growth within companies as globalization takes hold.
To listen to the full length interview
Appointed Leaders Creating More Issues For Oil and Gas
Mixed messages once again coming from North Dakota’s oil and gas leadership while the industry corrects itself within the marketplace and loses employees to other industries.
From pipelines to cancelled events to doubling down on harsh combative discourse, the state is quickly losing the public relations with the people and the regulation battle with the state.
For example, with all the Keystone Pipeline news, the Tesoro Pipeline shutdown has flown under the radar.
This pipeline feeds directly into the Mandan Tesoro Refinery and has been ordered to shutdown. Many across the state worry this will impact the local Bakken economy despite industry leaders stating this will not impact the refinery. In fact even Marathon is stating on their website that it “does not anticipate disruptions to its ability to meet customer commitments in the region” despite the shutdown order.
According to The Bismarck Tribune story:
A federal agency has ordered the shutdown of a pipeline that delivers oil to Marathon Petroleum’s Mandan Refinery, seven years after an easement allowing the line to cross part of the Fort Berthold Indian Reservation expired.
The Bureau of Indian Affairs also is billing Marathon $187 million for damages associated with the trespass of the company’s Tesoro High Plains Pipeline.
The BIA decision came July 2, just days before a federal judge ordered the much larger Dakota Access Pipeline to shut down in an unrelated case.
The North Dakota Department of Trust Lands has been back in the news publicly stating the oil and gas industry is not paying their bills. Worst part, it’s money that is tied to kids’ education. Due to years of appointed leaders using polarizing rhetoric and demonstrations in the state, the public discussion is now out-of-state oil companies making millions or local kid’s getting new pencils. In fact the media is now listing the oil and gas companies who are behind on paying their bills, whereas, in the past, it was a link or PDF of the companies.
Here’s an excerpt from recent KFYR news story.
Dozens of oil and gas companies across the state have fallen behind on payments to the state public schools trust fund, according to the Department of Trust Lands. Those payments amount to millions of dollars that could help fund education in the state.
The royalties from oil and gas production on public land are dedicated toward education in North Dakota. However, oil and gas companies in the state take issue with how the royalties are collected and some members stop paying until the issue is resolved in court.
ND Petroleum Council President Ron Ness says the companies pay transportation fees to get better prices on the oil and the royalties should be discounted by how much they pay.
The Crude Life is scheduled to interview North Dakota Land Commissioner Jodi Smith on Friday, August 7.
The mixed messages continue in the Bakken with Oilfield Helping Hands. About a week ago, the Bakken Summer Rides, a fundraising event for Oilfield Helping Hands canceled their outdoor event due to safety issues involving the coronavirus and COVID-19. This proclamation was issued despite promoting the event and soliciting participants days before the scheduled event.
According to the Minot Daily News, the Bakken Summer Rides were canceled due to safety and health.
Unfortunately, due to rising concerns surrounding the coronavirus, we have decided to cancel all three Bakken Summer Rides. Your health and safety is our utmost concern and we value your support.
This is where the mixed messages continue in North Dakota, because despite the COVID concerns and safety issues, OHH will be participating in pig roast fundraiser August 14 in Williston, ND, just one week after the canceled Bakken Summer Rides.
The Crude Life has interview requests into event organizers to discuss the COVID concerns and current event information.
The Crude Life Podcast can be heard every Monday through Thursday with a Week in Review on Friday.
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