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Last week in numbers
Friday oil prices: West Texas Intermediate (WTI) $53.69, Brent (ICE) $61.64
Natural gas weekly averages: Henry Hub $3.13, Wyoming Pool $3.37, Opal $3.4
Baker Hughes rig count: U.S. 1,059, Wyoming 33 (The Wyoming Oil and Gas Conservation Commission's Jan. 7 rig count from Drillinginfo was 43.)
Quote of the Week
"We needed a throttle."
Jeb Steward, former Wyoming representative, on limiting wind development during the industry's last boom.
People have argued about the wind tax in Wyoming since its beginnings, but yearly attempts to increase it have failed.
Now, longtime champion of increasing the tax, Sen. Cale Case, R-Lander, is pushing the issue from two sides. The normal bill has arrived in the House of Representatives, increasing the tax to $5 per megawatt hour. It's currently at $1. But the senator has also been active in organizing a group of citizens to put this matter on the ballot in 2020.
It's not easy to get a citizens' initiative on the ballot, but they intend to spend the next 18 months getting the 100 sponsors, followed by more than 30,000 required signatures from at least two-thirds of Wyoming counties.
Possible suit in coal port
The wind bill isn't the only familiar legislation trying again in 2019. Rep. Chuck Gray, R-Casper, is bringing back a bill that would authorize $250,000 for spending on a private attorney to fight for the Washington coal port.
The coal port has languished in court battles for years, and Washington state has not been friendly to the idea of a port on its coast. Proponents in Wyoming say that's not a fair deal, that Washington has no right to restrict Wyoming's economic interests and right to trade.
It's a difficult legal argument to make, based on the inverse or the negative of the commerce clause. In any case, Gray's bill would allow the Joint Minerals Committee to decide on hiring a lawyer and going after Washington. The measure failed halfway out of the gate last year.
Sale of Kemmerer
Westmoreland, the bankrupt coal firm working through its Chapter 11 case, had no luck unloading its coal assets in Montana, but the firm recently submitted to the court for approval a schedule for an auction of the Kemmerer mine in Lincoln County to take place before the end of February. Within a few weeks, a stalking horse bidder will be announced, according to court filings. Following that, depending on the number of interested parties, there may be an auction.
The Kemmerer mine employs nearly 300 people in Lincoln County and sells coal largely to the Naughton power plant nearby. The firm's bankruptcy has shaken up the unionized mine as Westmoreland has made attempts to cut the union contract and reduce liabilities by ridding itself of some retiree obligations.
Sparring over drilling
The federal shutdown is over, for three weeks at least, ending a growing spat between the oil and gas industry and environmental groups regarding what did and didn't happen over the last 30 some days.
Conservationists and green groups were angry that suddenly they had little to no access to Bureau of Land Management staff and records. Oil and gas companies in Wyoming were relieved to find out that some personnel would return to serve administrative demands for drilling applications and sundries.
“Just because the government is shut down doesn’t mean private-sector economic activity grinds to a halt,” Kathleen Sgamma, president of Western Energy Alliance, said in a statement following a forum in the House Natural Resources Committee held by Democrats. "Since oil and natural gas is overwhelmingly the largest source of revenue on BLM lands and for certain energy tribes, it simply doesn’t make sense to cut off that revenue completely."
Green groups have asked for lease sales to be delayed given that the shutdown impeded public oversight. Some have also discussed this in regard to the approvals of applications for permits to drill.
“It’s absolutely outrageous, not to mention illegal, that Trump is rolling out the red carpet for the oil and gas industry while the American people can’t even reach an agency staffer by phone,” Rebecca Fischer, climate and energy program attorney with WildEarth Guardians, said in a statement Jan. 17.
Mining and carbon capture
The mining industry got gung-ho on carbon capture the same day that the Energy Department announced its new funding for research into keeping the existing coal fleet operating at greater efficiency and lower emissions.
The National Mining Association is promoting a poll and study by Wood Mackenzie that show public support for carbon capture and utility of carbon research nationwide.
“If the U.S. wants to maintain the diversity of its dispatchable electricity mix and reduce its emissions, the government should be doing more to incentivize the use of advanced coal technologies,” said Hal Quinn, NMA President and CEO, in a statement.
The DOE is offering up to $38 million in R&D for the coal fleet. The Trump administration has previously freed up money into coal research. Wyoming officials noted last year that that support had increased interest in the Wyoming Integrated Test Center in Gillette.