News from the Oil Patch, Aug. 8
John P. Tretbar
The 85th Annual Convention & Trade Show of the Kansas Independent Oil & Gas Association is coming up. The event is scheduled Sunday and Monday, August 14th and 15th, at the Hyatt Regency/Century-Two Performing Arts & Convention Center in Wichita. Plans are coming together for the trade group's golf and sporting clays tournaments as well. You can find out more at their Web site, KIOGA.org.
More than half of the states in the US are boasting average gasoline prices below four dollars a gallon on Monday, and the national average is getting close. Kansas ranks among the ten cheapest state gasoline markets in the country, with a statewide average of $3.64 a gallon, according to the auto club Triple A. The national average pump price dropped to $4.05, down nearly 70 cents from a month ago. We spotted $3.59 across Great Bend and $3.93 at most stations in Hays.
Regulators in Kansas report 172 intent-to-drill notices in July. That's 1,023 Intents so far this year, compared to 630 by the end of July last year. A search of the Kansas Corporation Commission Web site returns two new Intents in Barton County, six in Ellis County, one in Russell County and four in Stafford County.
Baker Hughes reported 764 active drilling rigs across the US, a decline of seven oil rigs including six in New Mexico. The count in Louisiana was down three rigs, while Texas was up two.
Kansas operators have spudded 805 new wells so far this year, up 61% from a year ago. Independent Oil & Gas Service is currently scouting 449 wells in various stages of drilling and completion, an increase of more than 62% from a year ago. The Rig Count in Kansas for the week through August 4th shows 33 active drilling rigs in Western Kansas, which is up one from the week before. The count east of Wichita was unchanged at 25 rigs. Operators on Friday were about to spud one new well in Barton County, and another in Ellis County.
Kansas regulators okayed 23 new drilling permits last week, 18 in eastern Kansas and five west of Wichita. That's 967 new drilling locations so far this year, compared to 577 a year ago. Independent Oil & Gas Service reports 28 completed wells for the week, eight of them east of Wichita and 20 in Western Kansas. The year-to-date tally is 936 completed wells, compared to 461 a year earlier.
The Kansas Geological Society's Nomenclature Committee approved recognized and named four new oil fields in Kansas at its meeting last month. That brings the total so far this year to 19 new oil and gas fields.
Business is booming across the Lone Star State, thanks in large part to the oil patch. Texas is now boasting its highest-ever monthly oil and gas production tax collections for the second month in a row. The State Comptroller reports oil production tax collections reached $694 million, the highest monthly collections on record, up 84 percent from July 2021. Natural gas production taxes also reached a record high in July at $532 million, up 185 percent from last July. The state also reported record sales-tax collections in July.
Shipments of crude oil by US railroads declined last week. The Association of American Railroads reports 9,744 tanker carloads of petroleum and petroleum products rolling the rails during the week through July 30th. That's down 294 carloads from the week before and a 5% drop from last year at this time. Canadian traffic was down for the week but nearly eight percent higher than the tally a year ago. The AAR reported July total rail traffic down 1.5% from a year ago, although oil-by-rail traffic for the month was unchanged.
The government reported a rise in crude inventories of nearly five million barrels. As of July 29, US stockpiles were over 426 million barrels. The Energy Information Administration reports gasoline stockpiles rose by 200,000 barrels, but remain about three percent below the five-year average for this time of year.
EIA reports weekly crude imports were up 1.2 million barrels per day last week, to 7.3 million. The four-week average, at 6.7 million barrels per day, is 1.7% higher than during the same four-week period last year.
US crude production for the week through July 29 was up slightly from the week before, at 12,136,000 barrels per day, according to EIA.
Big prices translate to big profits for Big Oil. Chevron reported earnings of $11.62 billion during the second quarter of the year, nearly four times the tally from a year earlier. Exxon posted second-quarter earnings of $17.9 billion, compared to $4.7 billion a year earlier. BP is making more money than at any time since 2008, thanks to high crude prices. The British super-major tripled its profits om Q2 to more than $8.5 billion, marking the second-highest quarterly profit tally in the company's history. Shell last week reported record quarterly profits of nearly $12 billion.