Last week the Texas Supreme Court issued its opinion in Yowell v. Granite Operating Company, No. 18-0841, again grappling with the ancient Rule Against Perpetuities in the context of modern oil and gas transactions–the second time in two years in which the court tackled the inscrutable “Rule.” The facts (simplified):…
US oil production fell by 300,000 bbls/day last week to 11.6 million bbls/day. US oil production peaked earlier this year at 13.1 million bbls/day–decline from that peak is more than 11%. Expect more decline to come. Crude stockpiles declined last week by 700,000 bbls. Gasoline inventories fell by 3.5 million…
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…
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.
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.
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…
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…
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 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.…
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…