Oil and gas producers are investing in a Louisiana play that might significantly boost the state’s onshore production after decades of decline.
The Austin Chalk formation, which extends from Texas and runs underneath much of central and southeast Louisiana, has “huge” development potential, said Gifford Briggs, president of the Louisiana Oil and Gas Association.
“Hundreds of millions of dollars are being invested right now,” he said.
Unlike Texas or North Dakota, Louisiana has not experienced a boom in onshore shale oil production. Though geology obviously is an important factor, industry leaders say Louisiana’s legal climate discourages production.
A group of business associations recently hosted a luncheon to discuss the legal climate in the state of Louisiana as well as ways to improve the business scene for local enterprises.
The luncheon and panel discussion was sponsored by Louisiana Lawsuit Abuse Watch, Louisiana Coalition for Common Sense, and the Grow Louisiana Coalition and supported by the Louisiana Motor Transport Association, the Louisiana Oil and Gas Association and Louisiana Mid-Continent Oil and Gas Association and Louisiana Association of Business and Industry (LABI), a Jan. 24 posting on watchdog.org said.
The panel discussion at the luncheon featured Stephen Waguespack, CEO of LABI, who spoke on issues including lawsuit abuse in the state and tort costs, which are costing Louisiana families $4,000 per household on average, the posting said. Directly related to the rampant legal pursuits is auto insurance, which is one of the highest in the nation due to the number of lawsuits that are filed over minor car accidents.
With a capital budget of $6.1 billion and plans to grow production between 5% and 10% this year, ConocoPhillips (NYSE: COP) is pursuing several projects that could add low-cost supply resource, strengthen its portfolio and create future optionality, the company’s CEO said.
Speaking to analysts on an earnings call Jan. 31, ConocoPhillips CEO Ryan Lance shared insight on some of what he called “potentially impactful operating milestones.” These include advanced construction at the company’s Greater Moose Tooth (GMT) 2 project in Alaska, where exploration and appraisal drilling is underway, and a 14-well pad program taking place in Canada’s Montney play.
In the Lower 48 Big 3—Eagle Ford, Bakken and Permian Basin—ConocoPhillips plans to grow production by about 19% this year.
Oil prices were mixed Friday, but largely held on to recent gains amid signs of steep declines in OPEC crude production and heightened risks to Venezuelan supply.
— Brent crude, the global oil benchmark, was trading up 0.4% at $61.90 a barrel on London’s Intercontinental Exchange.
— West Texas Intermediate futures, the U.S. oil standard, were down 0.2% at $53.69 a barrel on the New York Mercantile Exchange.
OPEC: Brent crude was being supported Friday morning after a Reuters survey showed production from the Organization of the Petroleum Exporting Countries had declined by 890,000 barrels a day in January, to 30.98 million barrels a day, in its largest monthly decline in two years.
“As always, leading from the front was OPEC’s de facto leader Saudi Arabia. The kingdom’s oil production fell by 350,000 barrels a day to 10.25 million barrels per day in January and below its quota of 10.3 million barrels per day,” said Stephen Brennock, analyst at brokerage PVM Oil Associates Ltd. “Other cuts came courtesy of involuntary reductions from those exempted from supply curbs, namely Iran, Venezuela and Libya.”
The Houston oilfield services company Baker Hughes is moving ahead on its path to becoming an independent company again, after signing a series of separation agreements with its parent company, General Electric, Baker Hughes CEO Lorenzo Simonelli said Thursday.
The agreements, signed in the fourth quarter, include long-term collaboration deals for technology and equipment as well as digital products. Simonelli reported that the companies also reached agreements on controls, pensions, taxes and intercompany services.
“We are very pleased with the resulting agreements and what they mean for (Baker Hughes),” said Simonell. “They maximize value for us and provide certainty and long-term solutions for our customers, employees and shareholders.”
Despite a dramatic drop in crude oil prices during the fourth quarter, Baker Hughes posted a $131 million profit on nearly $ 6.9 billion of revenue during the fourth quarter. The fourth-quarter figures translated into earnings per share of 28 cents.
FOR Milestone Environmental Services, LLC (Milestone), 2018 was a good year and 2019 should be every bit as good, if not better. The oilfield waste treatment and disposal specialist is especially busy in the Permian Basin in West Texas.
In fact, four of the company’s seven facilities are in the Permian Basin. Two of the four facilities were opened in 2018—one of which was completed in July 2018 near Orla in northern Reeves County while the other was completed in August and is near Stanton in Glasscock County.
The other two Permian Basin locations have been in operation since 2017—one near Pecos, while the other is south of Midland. Milestone also has two facilities in the Eagle Ford shale play and one near Jasper in the Haynesville shale play in East Texas.
The mysterious delay of a $4.5 billion liquefied natural gas facility on the Louisiana coast has turned a case before the Federal Energy Regulatory Commission into the subject of a Washington guessing game, raising fears that what had been a predictable approval process for the nation’s booming natural gas exports is becoming mired in partisan politics.
Typically, that is not a problem for the independent commission, which has the reputation for bipartisanship. But suspicions were piqued last month when, without explanation, FERC pulled from the agenda of its Dec. 20 meeting a final decision on the Calcasieu Pass LNG facility, funded by the Virginia private equity group Venture Global LNG, and then left it off again at their next meeting Jan. 22.
“That is incredibly uncommon. It was an indicator they didn’t have the necessary votes for an approval,” says Charlie Riedl, executive director of the trade group Center for Liquefied Natural Gas. “The fact the projects haven’t gotten a vote are indicative the politics have changed. That’s the only logical conclusion you can draw.”
A Louisiana audit that suggested there could be wide-spread Medicaid misspending has prompted a probe on the federal level.
U.S. Sen. Ron Johnson of Wisconsin and Rep. Jim Jordan of Ohio penned a letter Thursday to Centers for Medicare and Medicaid Services head Seema Verma, citing a report from Louisiana Legislative Auditor Daryl Purpera as need for more information about whether there is a national Medicaid spending problem.
“If these improper payments are occurring in one state, it is logical to assume overpayments are occurring in other states,” the Republican congressmen wrote in the letter. “We respectfully request information about what the Centers for Medicare and Medicaid Services plans to do to determine where overpayments are being made, steps CMS will take to recover overpayments, and controls CMS will put in place to ensure federal Medicaid dollars are only paid to those who qualify.”
Pro-life and pro-choice forces have their eyes on the U.S. Supreme Court as Louisiana fights to have a years-old abortion law finally take effect next week, and opponents ask the high court to delay it.
Act 620 was passed by the Louisiana Legislature in 2014 and affects abortion providers.
“Fundamentally, what our law requires them to do is have admitting privileges within 30 miles of the clinic where they are carrying out their practice of conducting abortions,” said Liz Murrill, Solicitor General in the La. Attorney General’s Office.
The Trump administration is hoping for the swift departure of Nicolas Maduro after taking steps to push the Venezuelan leader toward the exit. But recent attempts at regime change show the transition may not be so simple.
The recognition of National Assembly President Juan Guaido as the country’s new president, combined with harsh sanctions on Venezuela’s national oil company, PDVSA, do ratchet up pressure on Maduro. But it’s wishful thinking to expect Maduro to hop on a plane tomorrow — or even in the next few weeks or months — seeking asylum in Cuba, Russia, China, or whatever country will have him.
With the military still on Maduro’s side, the potential for Venezuela to turn into a lasting stalemate is real. Strongmen rarely go down without a fight — look at Libya, Iraq, and Syria.
Sanctions are also not a surefire way to bring about change. And they can have economic consequences that extend beyond the targeted nation. The United States has now sanctioned the oil exports of two OPEC-member countries, Iran being the other country under severe sanctions.