Random Video of Electric Needs in the Oil Basin

Basin Electric Power Cooperative CEO visits the Bakken oil patch; uploaded February 15, 2012:

EPA Postpones New Air Standards for Fracking Natural Gas wells

Link to Rigzone here.

The delay is for two weeks.

The Environmental Protection Agency postponed its first rules aimed at reducing air pollution from oil and natural-gas wells drilled by hydraulic fracturing, following a last-minute push by energy companies to weigh in on the new standards.

The EPA said in a statement Monday it is postponing the rules by two weeks to April 17. The EPA said it needs more time to digest more than 150,000 comments submitted on the rule.

Earthjustice attorney Robin Cooley told reporters Monday that environmental groups are "disappointed that EPA hasn't gotten its act together," but said it is important for the agency to develop tighter standards.

Earthjustice sued the EPA to compel the agency to develop the rules, resulting in court-ordered deadlines for the EPA to do so.

As someone noted: this isn't even about Clean Water Act -- this is clean air. Will the madness ever stop?

Incredible "Talking Paper" on North American Energy -- Citi Sponsored -- Energy 2020

Updates

April 3, 2012: a rebuttal to the CITI paper.

Gasoline prices remain high, and Reuters recently noted that there are enough countries with civil unrest, technical problems and bad weather that there are around a million barrels a day of possible supply that are not getting to the market. Yet with Saudi Arabia continuing to reassure that it is willing to pump more oil, if needed, there appears to be, superficially, little cause for supply concerns this year. By the same token, in the longer term, concerns over supply also seem to be increasingly discounted. For example Citigroup has just released a new report on Energy 2020:North America as the new Middle East (same link as in the original post). The report suggests that there is really no concern with future supplies of oil and gas.

I would argue that the numbers for Saudi Arabia and Russia are difficult to realistically justify. For the Kingdom, which is reported to be producing 9.9 mbd, to increase production by another 2 mbd is optimistic, given the ageing of their primary fields and the decline in remaining volumes that I will discuss in future posts in the current series on that country. The projection of an increase in Russian production is a similar concern. With the decline in production from Western Siberia there is not enough new production coming from Timan-Pechora and Eastern Siberia to sustain existing levels let alone see an increase in production – a point that has been made by Russian officials in the past. However the real concern lies with the relatively unrealistic image that is being projected for US production over the next eight years.

The article continues; go to the link.

Original Post

This is, without question, the best overview of the status of the energy picture in North America. A huge thank you to "anon 1" for sending this link. I would have missed it.

It's a long, long PDF. I haven't read it all yet but I've scrolled through it and it will be great weekend reading.

Titled "Energy 2020," it's sponsored by CITI.

Abraxas Update

Link here to Abraxas update.

In the Bakken:

The refurbishment of the Company owned drilling rig has been completed and is currently rigging up in McKenzie County, North Dakota where it is scheduled to spud its first well, the Ravin 26-35 3H, a middle Bakken horizontal well, later this week. Abraxas owns an approximate 59 percent working interest in this well, as well as in the Ravin 26-35 2H, which will be drilled concurrently from the same multi-well pad site.

But this is the best line of the day:

"After many unforeseen delays, many of which were beyond our control, the drilling rig is in North Dakota and will be turning to the right very soon. ..... The Hedgehog well is probably one of the best in the Crossbow area, and the Cobra well is quite impressive, ....We look forward to getting all of the Pekisko wells on-line and stimulated .... With these new wells now or soon to be on-line, our 2011 exit rate production guidance will be exceeded – just a little late," commented Bob Watson, Abraxas' President and CEO.

His candor is refreshing.

Rigzone: Saudi Hypocrisy, Our Gullibility

It looks like I'm not alone with regard to my thoughts regarding Saudi Arabia. Link here to Rigzone.

One is compelled to pull out that old chestnut, "There he goes again." The face of Saudi oil, and de facto senior voice of the OPEC cartel, Saudi Oil Minister Ali Naimi entertained us to one of his seminal dissertations, expounding on Saudi Arabia's concerns for the well being of all mankind.

Stating the case clearly, that Saudi Arabia "... remains the world's largest producer and the country with the largest proven reserves, so it has a responsibility to do what it can to mitigate prices." No argument here.

Yet that bit of wisdom is prefaced by the oldest of canards, "Needless to say Saudi Arabia does not control the price: it sells its crude according to international prices." A truly bizarre declaration coming from the leading protagonist of the cartel, OPEC, whose primary function is to limit the supply of oil to world markets to control, and within the limits of the world's tolerance, to maximize the price of crude oil in the market place. Clearly their efforts have been so successful that the limits of tolerance have now been reached and letting off a little steam has become part of the ritual.

And that's just the beginning. Go to the link. Great op-ed piece.