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Last week in numbers
Friday oil prices: West Texas Intermediate (WTI) $67.59, Brent (ICE) $77.62
Natural gas weekly averages: Henry Hub $3.26, Wyoming Pool $3.24, Opal $3.27
Baker Hughes rig count: U.S. 1,068, Wyoming 30
Quote of the Week
“I don’t know whether we were just very good or very lucky.”
-- Arch Coal COO Paul Lang on evading the rain troubles that affected other producers in Wyoming's Powder River Basin.
It's earnings season, and both Cloud Peak Energy and Arch Coal have put out their numbers and answered investors' questions. Rain hit Cloud Peak, but its decision to cut retiree benefits offset those challenges on production. Both firms reported higher net income compared to the third quarter of last year.
Arch somehow lucked out on the spring rains compared to other Powder River Basin players and is busy funneling rewards to shareholders.
Peabody Energy is set to announce its earnings early this week.
Outside the basin, Westmoreland is trying to speed through Chapter 11 down in the U.S. Bankruptcy Court of Southern Texas by selling off its core assets, but the company that owns the Kemmerer mine is getting pushback from the United Mine Workers of America over risk to health benefits. The bankruptcy also introduces uncertainty in relation to the Naughton plant, which relies solely on Kemmerer coal.
Lease sale delays
An Idaho judge's decision to temporarily enforce Obama-era protocol over Trump's in regard to oil and gas leasing in sage grouse habitat has stalled most parcels in the Bureau of Land Management's fourth quarter sale for Wyoming. Those parcels in the bird's habitat or overlapping, some 700,000 acres, will be pushed to a February sale to allow for additional public comment.
Wyoming revenue forecasters released their October numbers, which will dictate the budget coming out of the governor's office before lawmakers take a crack at it.
A big thanks goes to oil dollars in the revenue forecast, which is up from previous assumptions. Estimates for crude pricing are cautious. But the CREG group notes optimism in the oil fields, in public companies' statements and robust oil and gas lease sales. That interest is driving the improvements in production that have helped buoy the overall revenue projections for the state.
The downward trend in natural gas production is expected to turn around, according to the CREG report, due to companies' success with horizontal drilling in the eastern gas fields -- notably Jonah Energy's NPL project that received approval from the Bureau of Land Management this year.
The number of applications for permit to drill natural gas wells has been falling for a decade but started to pick up in 2017.
CREG's coal production estimates have dropped by another 10 to 15 million tons as that sector continues to face uncertainty.
Growing interest in conservation
A University of Wyoming poll shows a growing concern with balancing Wyoming's energy interest and its conservation ethic.
Those who ranked the impact of oil and gas drilling on resources like land and water rose from 22 percent to 32 percent compared to a similar poll conducted in 2014. Ranking of pollution in rivers and lakes as extremely or very serious to those surveyed rose from 18 percent in 2014 to 41 percent this year.
But though issues like pollution and water availability for ranchers rank as serious or extremely serious to more than 30 percent of Wyomingites polled, they fall below social challenges like health care and education that concern more than half of those surveyed, according to the poll conducted by the Ruckelshaus Institute of Environment and Natural Resources and commissioned by groups including the Nature Conservancy of Wyoming and the Wyoming Stock Growers Association.
More than half of the respondents wanted to see an increase in energy production from solar and wind to oil and coal. On the flip side, 22 percent of respondents wanted to a see a decrease in wind and 22 percent wanted a decrease in coal.
Most respondents noted that wind energy provided a benefit to the state economy and jobs outlook, but most also saw the downsides of wind energy from viewsheds to wildlife.