Analysis by the father of American Geopolitics Dr. Daniel Fine, MIT.

Posts tagged ‘Colorado Shale Gas’

Publisher’s Note: Energy Industry Critical to New Mexico, Your Business


For the complete article use this link–> http://www.bizjournals.com/albuquerque/blog/2015/11/publishers-noteenergy-industry-critical-to-new.html by Candace Beeke is the president & publisher of Albuquerque Business First

It’s time to talk seriously about the energy industry in New Mexico. And you have some work to do.

Whether your business is directly involved in this industry, it’s very much tied to its outcomes — and right now, there’s much concern about that in the state. After all, some 30 percent of New Mexico’s tax base comes from oil and gas. And you’ve read the headlines we’ve been reporting on how that sector is faring. If you haven’t, let me recap — it’s a fracking mess. The price of oil dropping more than a year ago has resulted in rapid cost cutting from many of the energy majors, including ConocoPhillips (NYSE: COP) and Halliburton Co. (NYSE: HAL), both of which have major operations and workforce in New Mexico — although smaller now.
Some 30 percent of New Mexico’s tax base comes from oil and gas.

But that’s just one sector of energy. At Albuquerque Business First’s Energy Outlook event Nov. 12, we will hear from the CEO of one of the fastest-growing companies in New Mexico — Positive Energy Solar. And Positive wasn’t the only energy player on ABF’s List of gazelle companies this year. Affordable Solar Group ranked high and made Inc.’s list of fastest-growing companies, as well.

In addition to solar, we will hear from New Mexico energy giant PNM Resources (NYSE: PNM), which has its hands stretched into multiple sectors of energy. We’ve also added oil and gas expert Bob Gallagher, whom many of our readers will remember from his decade of leading the state’s oil and gas association, NMOGA, as well as his time as advisor to the U.S. Secretary of Energy. Gallagher tells me it’s not all doom and gloom in New Mexico oil and gas. In fact, he knows of pockets in the state that are growing rapidly and seeing strong new investment.
But New Mexico doesn’t operate in an energy vacuum. It’s critical for our companies — whether involved directly in energy or on the periphery of it, as most of us are — to understand the global and national challenges facing this industry. Dr. Daniel Fine from the Center of Energy Policy at New Mexico Tech will give us that broad overview and tell us what’s coming in the future.

Deregulation and Business Opportunities in the Mexican Energy Market w/ leading experts @ La Plata County Economic Summit 2015


The Mexican government has recently completed some of the most sweeping energy reforms in the world. Hear from experts on the deregulation of the energy markets in Mexico, and how to find opportunities for your business in both the energy sector and elsewhere in the Mexican economy.
To register for the summit use this link–> https://events.bizzabo.com/200300/home
Please join us and share this with your friends!

Speakers

Sandi Moilanen
Director-International Division
Colorado Office of Economic Development and International Trade

Daniel Fine
Associate Director
New Mexico Center for Energy Policy

Elie Smilovitz
Consul for Political, Economical, and Press Affairs
General Consulate of Mexico

Editorial: Governor’s energy plan is excellent future blueprint


New Mexico has a wealth of energy resources. And now it has a comprehensive plan to help guide development of those riches to grow the state’s economy.

Last week at the 2015 Southeastern New Mexico Mayor’s Energy Summit in Carlsbad, Gov. Susana Martinez laid out a broad “all of the above” energy policy. “There is no reason we shouldn’t be an energy leader,” she later told attendees at the eighth annual Domenici Public Policy Conference in Las Cruces.

Her plan embraces a wide range of energy sources, ranging from oil and gas to solar, wind and up-and-coming technologies, such as “small modular reactors,” which must still be approved by the federal Nuclear Regulatory Commission.

While the oil and gas industry has been – and still is – the backbone of the state’s energy economy (accounting for more than a billion dollars in revenues to the state each year), it’s clear there is plenty of opportunity for the growing renewable energy sector given New Mexico’s abundant sunshine, miles of windswept open spaces and nuclear experience and expertise.

One of the keys is development of more infrastructure – electricity transmission lines to move power generated by wind and solar, and new refineries and improved roads, rail and pipelines to transport resources in and out of the energy-producing areas in the southeastern and northwestern parts of the state.

It also proposes deployment of new battery storage technologies and exporting coal as utilities start using less of that resource as a result of agreements with the federal government to reduce greenhouse gas emissions and improve air quality.

Gov. Martinez of New Mexico unveils ‘all-of-the-above’ energy plan; first plan in 25 years “There is no reason we should not be an energy leader”


For the complete article use this link–> http://www.abqjournal.com/643822/biz/biz-most-recent/gov-martinez-to-unveil-new-state-energy-plan.html
By Kevin Robinson-Avila / Journal Staff Writer
Published: Monday, September 14th, 2015 at 8:50am
Updated: Monday, September 14th, 2015 at 10:32pm
………. ………. ………. ………. ………. ………. ………. ………. ………. ………. ………. ………. ………. ………. ………. ………. ………. ……….

ALBUQUERQUE, N.M. — Gov. Susana Martinez on Monday unveiled a broad “all-of-the-above” plan to develop New Mexico’s energy resources, the first such comprehensive policy outline for the state in 25 years.

The governor recommended a broad array of strategies and policies that includes traditional fossil fuels, such as oil, natural gas and coal, and renewables, such as wind and solar, and new technologies, such as “small modular reactors,” to harness nuclear energy.

It’s all about building and diversifying New Mexico’s economy to provide well-paying jobs, Martinez said.

“New Mexico is one of the most energy-rich and energy-diverse states in the nation, and we have an excellent opportunity to utilize this position to grow our economy and create more jobs,” Martinez said in a prepared statement.

“Improving our energy infrastructure, responsibly developing and producing energy of all types and better preparing our workforce for the needs of our energy sector are all critical components not only of a strong economic future, but of helping lead America to energy independence.”

Responses to the plan are likely to be varied, given the broad range of policies it promotes.

Column: Geopolitical events demand rapid response from unconventional producers by oil and gas expert Dr. Daniel Fine -Special to the Daily-Times-


For the complete article by Dr. Daniel Fine use this link-> http://www.daily-times.com/four_corners-news/ci_28389990/column-geopolitical-events-demand-rapid-response-from-unconventional?source=most_viewed

The Saudi-OPEC price war is now nine months old. Two OPEC meetings have passed without revisions or changes in strategy. It is a war against high-cost unconventional American producers that are seen as the principal threat to market share.

The West Texas Intermediate price per barrel has recovered since the low of the mid-$40 bottom to slightly above $60. This has become a trading range with algorithms following momentum making a price range. Financial or paper traders and speculators have moved the price of oil in a “rally” up $15.

Oversupply still overshadows the market. The balance of supply and demand awaits the onset of winter or 2016. The market share for OPEC and Saudi Arabia continues to expand at the expense of non-OPEC producers, but American shale or unconventional production has not declined to the point that an acceptable world balance between supply and demand appears to be in the making.

Daniel Fine

Daniel Fine (Daily Times file photo)

The CEO of Conoco Phillips was invited to the recent preliminary OPEC meeting and he challenged the producer countries with a warning: American “high cost” production will survive the price war with cost-saving efficiency already in process and yet to come. This promises American oil supply at less cost and a prospect of little change in world supply while demand remains weak and possibly weaker with China importing less crude as well as iron ore and other commodities.

What is now at play in oil price formation is geopolitics.

Column: Marginal wells could remain active with royalty reductions by Dr. Daniel Fine


For the complete article use this link–> http://www.daily-times.com/farmington-opinion/ci_27759499/column-marginal-wells-could-remain-active-royalty-reductions

The oil price collapse has put at risk marginal or stripper well production in New Mexico and the United States.
There are 15,000 such producing wells in the state yielding an average of less than three barrels per day. Over 400,000 are working in the country. Combined, some 15 percent of total oil production is from stripper wells. Stripper wells include natural gas wells with marginal production.
Since the shale oil extraction breakthrough beginning in 2009, service costs have increased. Most stripper owners require a $70 price per barrel of oil (West Texas Intermediate) to avoid shut-in. The decision to shut-in is not taken lightly. In New Mexico if there is no production reported for 60 days, the lease is lost. Once shut-in or abandoned, stripper wells’ oil production and reserves are lost to the state and the country.
It is uneconomic to drill a well from shut-in or abandoned status for three barrels per day.
Stripper production is a strategic privately held oil reserve and has provided, since 1973, an offset against supply disruption. It is recognized by the Organization of Petroleum Exporting Countries, which is in a price war against American shale producers and stripper well production, that both operators are high-cost producers. The organization’s objective is more OPEC oil and less American — Southwest and North Dakota — in the market.
The stripper producer must decide whether to lose money and hold his lease or shut-in as abandonment which surrenders the lease. It was this circumstance that New Mexico considered in 1994 when the state Legislature passed a bill into law that provided royalty rate reduction. Lowering the royalty rates paid by stripper well owners to state and the federal governments provides an economic incentive to avoid shut-in.
Over a million barrels a day production could be lost without royalty rate reduction.
This program has not been promoted and today is not widely known by the stripper owners as it languished in the New Mexico State Land Office while the price of oil remained high. Fewer than 400 wells are registered for program incentives out of nearly 5,000 operating wells. A recent effort to reactivate and upgrade the program through an amendment that would raise the qualification from three to six barrels per day — 10 barrels at 20,000 feet in well depth — failed.

Join the San Juan Basin Energy Conference 2015! New Mexico Governor Martinez and CEO, WPX Energy Rick Muncrief are speakers!


Event Date and Time
Date: Tuesday, March 24, 2015
Time: All day
Repeating Event: Daily;Until=3/26/2015 12:00am

Location: Henderson Fine Arts Center

Event Details

The continuing drop in oil prices and the opportunities for natural gas will be a focus of the 2015 San Juan Basin Energy Conference, set for March 24-25, at San Juan College in Farmington, NM.

“The conference will give those attending the opportunity to discuss and receive insights into the future of energy and the market it serves,” said Randy Pacheco, dean of the San Juan College School of Energy and the CEO of Four Corners Innovations. San Juan College School of Energy, Four Corners Innovations and New Mexico Center for Energy Policy (a division of New Mexico Tech) are sponsors of the event.

“We expect the 2015 conference to attract the same industry professionals who came in 2013, and who are willing to share their visions and knowledge of the industry,” Pacheco said. “The conference encourages networking and provides a positive environment for leaders to discuss their concerns and their expectations of the future of oil and gas and electrical generation.”

Conference attendees will have an opportunity to learn from keynote speaker Rick Muncrief, an industry professional who is familiar to many in the Farmington, NM, area.

Muncrief, who was named WPX Energy Inc.’s Chief Executive Officer in May, has ties to the San Juan Basin, and will speak to the expected 750 attendees on March 24. Before taking the helm at WPX  in its Tulsa, Okla., offices. Muncrief worked for ConocoPhillips and Burlington Resources locally and spent five years with Continental Resources.

Muncrief’s return to Farmington is anticipated by many who know him.

Bill Standley, former mayor of Farmington and now a municipal judge, remembers Muncrief as a man of, “intelligence and integrity,” he said. Standley said if he were a member of a board of directors of a major oil and gas company, he would invest in a chief executive officer of Muncrief’s caliber.

Muncrief recently made news in southwestern Pennsylvania when he announced WPX has decided to divest itself of its Marcellus Shale assets. WPX has approximately 160 active wells in dry gas areas in southern Pennsylvania, and has been drilling in the Marcellus since 2010. Muncrief and the board of directors of WPX decided to focus on New Mexico and two other areas of the county in which WPX has assets. Colorado, which has natural gas liquids, and North Dakota, along with New Mexico, where the company drills for oil, offer a positive return on investment, a spokesman said of the three states.

In addition to Muncrief, speakers expected to participate in the conference include Ken McQueen, also of WPX; David Martin, Secretary of the New Mexico Energy, Minerals and Natural Resources Department; Dr. Dan Fine, research associate for the New Mexico Center for Energy Policy/ New Mexico Institute of Mining and Technology; Steve Henke, president of the New Mexico Oil and Gas Association; and Marita Noon,executive director of Citizens’ Alliance for Responsible Energy, a lobby group funded by New Mexico oil and gas industry interests, and  the executive director for Energy Makes America Great Inc.

Other speakers have been invited to participate in the conference and those names will be released when they are confirmed.

This is the second San Juan Basin Energy Conference. The first one, held in March of 2013, attracted more than 450 people attending.

“The tremendous response from the leaders in the industry to our first conference, and the success we enjoyed from it, has set the bar pretty high for the 2015 conference,” said Randy Pacheco. “The cost of oil, the direction and future of the oil and gas/energy industry, and the vision of industry leaders will make this conference, just like the one in 2013, an event that will bring together people who have invested their time, experience and talents to an industry that remains a backbone of our economic foundation.”

For additional information, visit the conference web site at www.sanjuanbasinenergy.org; or call 505-566-3676.

Event Location

Henderson Fine Arts Center

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