Great story in Houston Chronicle. Power companies were deregulated by the Legislature to create a competitive market for retail electricity, except for some municipally owned utilities like those in Austin and San Antonio. Turns out consumers in Austin and San Antonio have the better deal. Power companies do their best…
Oil and Gas Lawyer Blog
The State of Crude Oil Inventory
The Wall Street Journal today published some excellent graphs illustrating the glut in world and US oil inventories. Click on images to enlarge. Article is here.
Sitton Drops Motion to Prorate
Texas Railroad Commissioner Ryan Sitton announced today that he would withdraw his motion to prorate Texas oil production prior to the Commission hearing tomorrow, saying “proration is now dead.” Commissioner Christian had previously announced his opposition; Commissioner Craddick is evidently also opposed.
Texas Railroad Commission: Commissioner Sitton’s proposed proration order to be considered May 5; Commissioner Christian opposed
Commissioner Ryan Sitton has published his proposed conditional order imposing proration on oil production in Texas, to be considered at the Commission’s hearing on May 5. Commissioner Wayne Christian, in an op ed in the Houston Chronicle, has come out against the proposal. Sitton’s proposed order is attached to the…
Proration at the Railroad Commission: Sitton’s motion to conditionally order Texas operators to reduce their oil production by 20% is tabled.
The Texas Railroad Commission at open meeting today considered Pioneer and Parsley’s petition asking the Commission to institute oil proration. Commissioner Sitton moved to institute proration, conditioned on other states and countries committing to a total of 4 mm bbls/day additional reduction in oil production by June 1. Sitton’s motion…
To Prorate or Not to Prorate?
The Texas Railroad Commission heard comments yesterday in a virtual open meeting on the proposal from Pioneer and Parsley that the Commission re-institute proration of Texas oil wells in response to the drastic reduction of world oil demand. Unsurprisingly, those providing comments did not agree. In general, the division was…
Two New Studies from UT Austin on Shale Waste Water
Two studies by University of Texas’ Jackson School of Geosciences analyzed data on water use in eight major US shale plays from 2009 to 2017. The first study, published in Environmental Science and Technology, quantifies how much water is produced from wells and how much is need for hydraulic fracturing.…
Who Is Responsible for the Oil Glut?
The failure of Saudi Arabia and Russia to agree on reductions in oil production, combined with the crash in demand caused by COVID-19, are blamed for the rapid decline in oil prices and the glut in supply. But looking back, it can be argued that another cause is the rapid…
Parsley and Pioneer Formally Ask RRC to Prorate Production.
Pioneer Natural Resources and Parsley Energy sent a letter to the Texas Railroad Commission formally requesting that it institute proration in Texas oil fields. Scott Sheffield and Matt Gallagher concluded: We thus implore you to act as stewards of Texas’s oil resources and to support rationally tailored actions – consistent…
Royalty Owners’ Rights in Bankruptcy
Another recent bankruptcy court ruling may bode ill for producers and royalty owners in Texas in light of the collapse of oil prices and increased risks of bankruptcy of producers and oil purchasers. In Re: First River Energy, LLC, 2019 WL 1103294(US Bankr. W.D. Tex., March 7, 2019), also highlights…