Luke LeGate's Texas Energy Clips, September 28, 2020
Texas Energy Clips
Devon Energy to buy shale peer WPX for $2.56 billion in Delaware push
September 28, 2020
U.S. oil and gas producer Devon Energy Corp DVN.N said on Monday it will buy Permian basin peer WPX Energy Inc WPX.N for $2.56 billion as it looks to scale up its presence in the Delaware portion of the prolific shale field.
The deal values WPX at $4.56 per share, just 2.7% higher than the stock’s closing price on Friday. WPX shares surged more 12% in premarket market trading to $5, well above the per share price implied in the Devon merger, suggesting shareholders expect a higher offer.
Deals at little or no premium are becoming the norm in the oil and gas industry as producers seek out combinations to tide out a coronavirus-induced slump in demand and a crash in prices of hydrocarbons.
Devon's deal is the second major merger in the troubled industry following the price shock in April when crude oil briefly traded in negative territory. In July, Noble Energy Inc NBL.O agreed to be acquired by Chevron Corp CVX.N for $5 billion in stock…
Craddick assumes RRC chairmanship for third time
By Mella McEwen
September 27, 2020
Midland native Christi Craddick has a lot on her plate as she assumes the chairmanship of the Railroad Commission. Marking her third time as chairman since she was first elected to the agency in 2012, Craddick was unanimously named chair by her fellow commissioners, Wayne Christian and Ryan Sitton.
The agency’s budget is her first focus, she told the Reporter-Telegram in a phone interview. The upcoming Texas legislative session that begins in January will address a significant budget shortfall that is a result of the pandemic, and Craddick said the agency has already included a 5 percent budget cut in its request submitted last week. “Consistency is important for us long-term as an agency,” she said, pointing out that the commission is the only state agency that follows the economic ups and downs of the industry it oversees.
That affects not only the commission but the state treasury because the state’s oil and gas industry makes significant contributions in terms of severance taxes, sales taxes and lease and royalty payments…
Natural gas use by factories fell 20 percent during pandemic
By Paul Tahahashi
September 26, 2020
Natural gas consumption by U.S. factories fell more than 20 percent during the first six months of the year as the coronavirus pandemic slowed the nation’s manufacturing sector.
U.S. factories used 20.1 billion cubic feet per day of natural gas in June 2020, down from 25.4 billion cubic feet per day in January, according to a new report from the Energy Information Administration.
Natural gas consumption in the industrial sector hit bottom in May, falling 8 percent compared with a year ago. In fact, May marked the largest year-over-year decline since July 2009, during the middle of the Great Recession.
The demand drop over the first half of 2020 reflects the global pandemic, which forced factories to close temporarily. The U.S. gross domestic product, which measures the value of goods and services produced nationally, fell by 9.1 percent during the second quarter compared with the same quarter a year ago, according to the Bureau of Economic Analysis…
San Marcos Business Corridor News
Texas Energy Company Announces New Pipeline To The Texas Gulf Coast, New Partnership
September 26, 2020
Texas-based energy company Max Midstream announced the acquisition of the Seahawk Pipeline and Terminal from Oaktree Capital at the Port of Calhoun (“the Port”) with plans for a historic pipeline that will connect the Port directly to both Eagle Ford and Permian Basins to transport up to 20 million barrels a month to a revitalized terminal at the Port.
Exports will begin with the completion of the first phase in late 2020, and the second phase project is expected to be completed by 2023.
“This is a great day not only for the Texas oil industry but for the state as a whole, as more than 1000 jobs will be created,” said Todd Edwards, President of Max Midstream. “At a time when the oil and gas market is down, this project and partnership reflect proof that Texas is bouncing back and will remain resilient in being the world’s leader in oil production.”
Specifically, Edwards noted that the Impact Data Source consultants have performed a comprehensive economic impact study and found the project will create 474 direct new jobs and another 598 construction-related jobs over the next ten years…
Private equity manager sees automation as future of energy industry
By Mella McEwen
September 27, 2020
A new transformation appears to be underway in the nation’s energy industry.
“There’s something happening right now I think is a really big deal,” said Chuck Yates, former managing partner at Kayne Anderson during the weekly Oilfield Strong webinar presented by OTA Compression, OTA Environmental, Kimark and the Permian Basin Petroleum Association.
“We are transitioning from the age of the driller, where we were providing marginal barrels of oil to the world from U.S. shale and, boom, COVID-19 took 15 million barrels offline. I don’t know if oil demand is growing right now (but) it will be gross domestic product-driven given the fact OPEC can turn on 10 million barrels tomorrow of they want. Even if we grow oil demand 1 (million) to 1.5 million barrels a day going forward, there’s a lot of time (when) we don’t need to supply more oil. We’re transitioning to a world where the U.S. will produce oil and literally the most important person in each oil and gas company will be the production engineer.” In an era of waning production, Yates said pennies will matter and oil companies will become low margin. And while he said he hated to say it, that means eliminating jobs and turning to automation…
Corpus Christi Caller-Times
Forum: Evolution from oil and gas to wind and solar energy is not easy, but is necessary
September 28, 2020
I could stare at big energy infrastructure for hours. But for COVID-19, I would happily sit on my grandmother’s balcony on the 10th floor of Brookdale Trinity Towers in downtown Corpus Christi and endlessly gaze at the industrial silhouettes on the glimmering horizon.
I credit my late grandfather Charles R. Porter Jr. for the habit. He would pick me up from the Corpus Christi airport when I would fly in for a visit in late summer, right about this time of year, just before my classes were starting back up. As he would drive along the south side of the ship channel, Grandad’s eyes were fixed not on the road but rather on the infrastructure off to our left. A stalwart in the local legal community, Grandad had watched the town grow up, had been there at Corpus’s crucial developmental milestones. Waving his pipe, regaling me with his courtroom war stories, thus my grandfather’s contagious affection for energy infrastructure was transmitted to his grandson.
With each summer visit, the infrastructure that Grandad highlighted would change. Refineries, wind turbines, an offshore rig fabrication facility, plastic polymer plants, a new LNG liquefaction train, new tanks supporting crude exports, the new Harbor Bridge... recollections from my summer Corpus visits read like a history of the evolution of energy…
KRIS-TV - Corpus Christi
Oil well drilling fluid flows through neighborhood
September 126, 2020
CORPUS CHRISTI, Texas — While arriving home from work Wednesday afternoon, Alan Flores was surprised to see some kind of liquid flowing in the bar ditch in front of his house on Nueces County Road 73A just outside of Calallen.
“We hadn’t had rain in two or three days, so I wondered, 'Where is all this coming from?" Flores said. "And the color was unusual. That’s what got me."
Flores tracked the liquid about a quarter of a mile up the street to a property where a Houston-based company drilled for oil last month. He then called the Texas Commission on Environmental Quality concerned that the liquid could be dangerous.
“We’re just being taken advantage of because the drilling company said they were going to take care of the community," he said while motioning to the bar ditch that still contained some of the liquid Thursday. "This isn’t taking care of the community."…
Opinion: A match made in Houston — United States has energy resources, India has a huge market
By Taranjit Singh Sandhu, Ambassador of India
September 27, 2020
Announced during Prime Minister Narendra Modi’s visit to the United States in June 2017 — and its intensity enhanced when Modi visited Houston in September 2019 — the Strategic Energy Partnership has emerged as a cornerstone of expanding India-U.S. ties.
India’s quest for energy security offers limitless possibilities to U.S. companies and has the potential to oil the engines of economic growth in both India and the United States. As we slowly move toward opening up, the partnership has the potential to play an important role in economic recovery.
The energy market in India is vast and growing rapidly. It is the world’s third-largest producer of electricity and set to be the largest energy market before 2030. The IEA’s World Energy Investment 2019 report highlights that among major markets, energy investments in India have grown the most over the past three years, with an investment of $85 billion. India offers a huge market; the United States is abound in energy resources and leading technologies including in natural gas and solar — the complementarities and synergies are striking…