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

Posts tagged ‘Taxes’

Oil producers want U.S. to restrict imports


By Kevin Robinson-Avila / ABQ Journal Staff Writer

The full story is here-> http://www.abqjournal.com/803674/oil-producers-want-u-s-to-restrict-imports.html

“ALBUQUERQUE, N.M. — New Mexico and West Texas oil producers are gearing up for a national effort to draw all major U.S. oil basins into a grassroots movement to restrict crude imports from overseas.

Leaders of the Panhandle Import Reduction Initiative, which launched in April in the Permian Basin, are seeking public meetings and rallies in other oil-producing zones to convert what’s now a regional initiative into a national movement, said Daniel Fine, associate director of the New Mexico Center for Energy Policy, who is working with local producers.

Those efforts will kick off in September with a presentation at the fourth Southeastern New Mexico Energy Summit in Carlsbad. After that, initiative leaders expect to hold public meetings in other shale oil basins, including the Bakken in Montana and the Dakotas and the Eagle Ford in South Texas.

“We’ll take it to Carlsbad first, and then it goes national,” Fine said. “We want to organize public rallies with producers and field workers whose jobs are at stake. This is a grassroots effort in the basins where the oil bust has taken place.”

The initiative is a reaction to the Organization of Petroleum Exporting Countries’ aggressive oil-pumping policies since mid-2014, which have helped drive global oil prices to ten-year lows and thrust domestic U.S. production into crisis. Initiative leaders say those policies were a deliberate effort by the mid-Eastern members of OPEC, particularly Saudi Arabia, to drive U.S. producers out of business.

Banning crude imports from overseas would undercut OPEC’s ability to manipulate prices, they say, and allow U.S. producers to ramp up domestic production to supply the U.S. market.”

Energy group hopes to reduce foreign oil imports


by James Fenton

The full article is at–> http://www.daily-times.com/story/money/industries/oil-gas/2016/06/14/energy-group-hopes-reduce-foreign-oil-imports/85855044/

“FARMINGTON – A group of oil and gas executives and energy policy experts from the Texas Panhandle and New Mexico’s piece of the Permian Basin are pushing a plan to restrict seafaring imports of foreign oil from coming into the U.S. in order to stabilize the oil and gas industry and bring back lost oilfield jobs.

The group’s plan, which would exempt crude oil imported from Mexico and Canada, is an effort to push back against the price wars the group said are being waged by OPEC, or the Organization of the Petroleum Exporting Countries, led by Saudi Arabia.

Members met at the School of Energy at San Juan College Tuesday to promote  the “Panhandle Import Reduction Initiative,” which they say could be implemented in multiple phases within 90 days of the next administration, with the ultimate goal of reducing heavy crude oil imports to about 10 percent of demand.

Launched in November, the initiative aims to cut foreign oil imports enough to activate more domestic drilling rigs and boost domestic production to meet current demand levels within four years.

Former state legislator and Four Corners Economic Development Chief Operating Officer Tom Taylor said the drop in natural gas prices eight years ago and the fall of crude oil in 2014, has delivered prolonged pain to the regional economy.

“We find ourselves … in a situation now where we’re down about 6,000 jobs, most of those in the oil and gas industry,” Taylor said of the San Juan Basin. “We have about 11,000 people who have left (San Juan County) … So while we’re down 6,000 jobs and down 11,000 people, we’ve built seven fast-food restaurants, three more under construction, and two big box stores. It’s a different world out there.

“But the fact of the matter is that the economic base of the community is in trouble. And not only is the community in trouble, but the state of New Mexico is in trouble, and not only is New Mexico in trouble but our nation and its security. It’s all tied together. It’s a very difficult situation we find ourselves in when we have one country that can control oil prices. It goes beyond free trade. It’s a problem we need a solution to. We are at the dependence of foreign oil.”

Taylor said about a third of New Mexico’s general fund comes from the oil and gas industry in the form of taxes and fees.”

World Oil and Gas expert Dr. Daniel Fine: Oil at halftime, 2016


The full story is here-> http://www.daily-times.com/story/opinion/columnists/2016/05/28/fine-oil-halftime-2016/84610710/

“The question of the oil-price reality pervaded the talks and private conversations at the Four Corners Oil and Gas Conference earlier this month. From the lowest price per barrel in nearly eight years to a recovery halfway to $100 in less than three months!  Is the “bust” in the San Juan Basin dissolving as others before?

Yet, Ken McQueen, retiring vice president of WPX in the San Juan Basin, and the most effective in technical innovation in the basin, said: “price is not everything.”

This is the view of surviving management. It is not shared by financial institutional  players and speculators.

Before Thanksgiving 2014, I presented a forecast for the oil price in a new “crash” range of $23 to $28. This was based on analytical experience and petroleum economic history. The trade associations were then spinning that it was an opportunity and would turn around in weeks.

They had no understanding of Saudi Arabia and OPEC as the price-setter. The price of oil collapsed three months ago to $26.70.

There was an abortive effort by OPEC and Russia at Doha, Qatar, to freeze production at Jan. 1 levels to “re-balance” world demand and supply. It failed because OPEC was no longer outside the Middle East political and religious war — Shia-Iran, with oil export sanctions recently lifted, did not show up.

But a one-day oil field workers stay-at-home in Kuwait took one million barrels of oil off the over-supplied world market within 24 hours and the financial market players covered their short or future sale positions.

The bet was now that every “outage” or supply disruption in the world would “re-balance” demand and supply and move West Texas Intermediate prices higher.

Saudi Arabia alone is replacing all the “outage” oil while the San Juan Basin and Southwest producers have record lay-offs, bankruptcies, community economic dislocations, and cuts in production: a million barrels less per day by Christmas is anticipated.

Without the freeze of OPEC production, $50 a barrel prices are here nevertheless. Does the rig count recover — only 15 working in New Mexico from over 100 just 18 months ago?

Yes and no. Companies should start stimulating (fracking) the heavy inventories of uncompleted wells. A boom again? Hardly. With more drilling of uncompleted wells at $50, American Southwest unconventional production rises. Saudi Arabia and the Gulf nation producers would see once more the threat to market share which started the bust in the first place.

Higher oil prices equate to more production and energy-related banks and funds might find new borrowers. Is this the constraint of lower and longer oil prices? It doesn’t matter what supply forecasts come from traders’ prattle on cable TV. The final half of 2016 will be negative on price and oil demand. The price war with Saudi Arabia/OPEC continues.

There are three counter-strategies to Saudi Arabia and OPEC from American shale oil producers and communities:”

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New Mexico energy secretary visits Farmington to begin revising energy plan


New Mexico energy secretary visits Farmington to begin revising energy plan

Plan is expected to boost economic development in the state
By Chris Roberts The Daily Times

FARMINGTON — The New Mexico Energy Secretary visited Farmington on Wednesday to hear from oil and gas executives on a proposed revision of the state’s energy policy, which has not been substantially changed since 1991.

Dave Martin, secretary of the Energy, Minerals and Natural Resources Department, sat with T. Greg Merrion, president of Merrion Oil and Gas, and others and listened to the concerns and suggestions of local people involved in coal, natural gas, crude oil and energy production. It was the first stop in a tour that will include Hobbs, Santa Fe, Las Cruces and Albuquerque. During those other stops, topics of discussion will include energy efficiency, renewable energy and biofuels.

“All-of-the-above will produce more jobs,” Martin said of including renewable energy. “A lot of these things are going to be region specific.”

Martin said people invited to the Wednesday meeting at San Juan College were “targeted” for their local knowledge of the issues. Media was asked not to attend the actual discussions, so business leaders could speak freely, but when a reporter from The Daily Times showed up at the meeting, he was allowed to sit in. Martin spoke to the press after the meeting. For more of the article use this link–> http://www.daily-times.com/farmington-business/ci_24615895/encana-announces-multi-million-dollar-drilling-plans-2014

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Encana announces multi-million dollar drilling plans for 2014 in the San Juan Basin


http://www.daily-times.com/farmington-business/ci_24615895/encana-announces-multi-million-dollar-drilling-plans-2014

Encana announces multi-million dollar drilling plans for 2014 in the San Juan Basin

By Leigh Black Irvin The Daily Times

FARMINGTON — Encana Corporation announced earlier this month a new company strategy and vision, with much of that strategy being focused on the San Juan Basin where it plans to invest hundreds of millions of dollars in new oil and gas production beginning in 2014.

The announcement has prompted a flurry of speculation among those in the local oil and gas industry that the increased drilling will begin immediately after the first of the year.

In a Nov. 5 news release, the Calgary-based Encana outlined key points of its strategy, the first of which states that it will “focus its capital investment on five oil and liquids-rich resource plays in North America.”

The release goes on to state that Encana will “invest approximately 75 percent of its 2014 capital into five high return oil and liquids-rich plays: the Montney, Duvernay, DJ Basin, San Juan Basin and Tuscaloosa Marine Shale.”

In dollar amounts, this translates to 350 million to 400 million dollars in capital that Encana plans to invest in the San Juan Basin in 2014, said Encana spokesman Doug Hock.

“We will run two to four rigs in the area where oil and liquids are,” said Hock. “Our strategy is to develop oil and natural gas liquids plays in the Mancos Shale over the course of 2014.”

Hock said that to date, Encana has drilled some 20 wells in the Basin at a rate of approximately one well a month, and the increased production plans are a result of the positive drilling performance already seen in the basin, as well as economic conditions that make drilling in this area beneficial to the company. For more of the article use this link–> http://www.daily-times.com/farmington-business/ci_24615895/encana-announces-multi-million-dollar-drilling-plans-2014

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US Gas and oil boom benefits consumers


US Gas and oil boom benefits consumers

After years of steadily rising prices, “low-cost fuel” may seem like an oxymoron.

But thanks to a steady surge in domestic oil and gas production, energy experts say consumers could enjoy inexpensive gasoline and natural gas for years to come.

MAP MASTER“The outlook is for a low-cost energy economy in the U.S.,” said Daniel Fine, associate director of the New Mexico Center for Energy Policy, which is run by the New Mexico Institute of Mining and Technology in Socorro. “This is a long-term trend, not an isolated event, and it’s something almost revolutionary.”

The country’s newfound oil and gas boom, made possible by modern drilling technologies, has helped keep gasoline prices well below the $4-per-gallon peaks that consumers faced just a few years ago. It’s also driven home-heating bills to record lows since 2009.

Now, with production still climbing fast, Fine and others say natural-gas prices will remain moderately low for another five to 10 years at least. And gasoline prices likely will continue to fall into 2014, before stabilizing at somewhere above $2 per gallon for the foreseeable future.

“I believe gasoline will reach $2.35 a gallon or less quite soon, within a year at most,” Fine said.

Gregg Laskoski, a senior policy analyst with the online price-tracking service Gas Buddy, agreed.

“That may seem shocking, but it’s not as outlandish as it sounds,” he said. “The potential is certainly there.” For more of the article use this link—> http://www.abqjournal.com/302397/biz/oil-gas-production-booms.html

Must Read! Step on the gas BY JAMES LOEWENSTEIN


TOWANDA – Bradford County and approximately a dozen other counties across the United States are establishing an association that will advocate for the safe and responsible development of natural gas, the chairman of the Bradford County commissioners said.

Increasing the production of natural gas and oil in the United States will accelerate the economic recovery, and the safe and responsible development of natural gas and oil “is critical to powering our nation’s future,” the Bradford County Commissioners wrote in a resolution that they plan to pass today, which will make Bradford County a member of the association.

There is “a lot of excitement” in counties across the United States about the association, which will give counties where oil and gas is produced a national voice on oil- or gas-related issues, said Doug McLinko, chairman of the Bradford County commissioners.

For more of this great article go to —-> http://thetimes-tribune.com/news/step-on-the-gas-1.1326297?goback=.gmp_1687797.gde_1687797_member_124899393

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