USGS Estimates Size of Wolfcamp

By: Michael K. Reer

On November 15, 2016, the U.S. Geological Survey estimated that the Wolfcamp shale in the Permian Basin contains 20 billion barrels of oil, 16 trillion cubic feet of associated natural gas, and 1.6 billion barrels of natural gas liquids.  The USGS estimate makes the Wolfcamp shale the largest estimated continuous oil accumulation found in the United States. 


USGS estimated the size of the Wolfcamp as part of a nationwide project designed to assess domestic petroleum basins using standardized methodology and protocol.  USGS estimates continuous oil based upon undiscovered, technically recoverable resources.  The Wolfcamp is part of the Wolfberry play near Midland, Texas, which has seen a resurgence of activity since the advent of hydraulic fracturing.
Monday, November 21, 2016

Railroad Commission Amends Rule 15

By: Michael K. Reer


On November 15, 2016, the Railroad Commission of Texas announced final amendments to Rule 15 (“Surface Equipment Removal Requirements and Inactive Wells”), which will take effect January 1, 2017.  Generally, Rule 15 requires that operators who assume responsibility for an inactive oil or natural gas well either plug the well or return it to active operation within six months after the Commission approves an operation designation form. 

The final rulemaking modifies the regulatory requirements for returning oil and natural gas wells to active operation.  Currently, operators must produce at least 10 barrels of oil or 100 Mcf of natural gas for at least three consecutive months for an inactive well to become active.  Under the finalized rules, operators must produce just five barrels of oil or 50 Mcf of natural gas for an inactive well to become active.  Alternatively, operators may produce at least one barrel of oil or one Mcf of natural gas for 12 consecutive months. 

The Commission stated in the preamble to the final rulemaking that “the amendments discourage the premature plugging of wells that have the potential to produce and, thus, align with the Commission’s responsibility to prevent waste.”   

Friday, November 18, 2016

Commissioner Sitton Joins CISR

By: Michael K. Reer


On November 15, 2016, Texas Railroad Commissioner Ryan Sitton announced that he will join the Bureau of Economic Geology Center for Integrated Seismicity Research ("CISR").  According to the press announcement, CISR conducts "fundamental and applied research to better understand both naturally occurring and potentially induced seismicity and the associated risks." 

Commissioner Sitton states that "the science is clear that it is physically possible for injection wells that dispose of fluids deep underground to cause earthquakes" but cautioned that hydraulic fracturing itself may only cause "micro earthquakes that are almost never felt."  The press release also states that the Commission will use industry data and the Texas Seismometer Network to enhance CISR's and the Commission's understanding of induced seismicity.  In particular, the Commission will examine the potential for induced seismicity in Johnson County, Texas.

Thursday, November 17, 2016

Western Energy Alliance, IPAA Challenge BLM Methane Regulations

By: Michael K. Reer


On November 15, 2016, the Western Energy Alliance and the Independent Petroleum Association of America filed suit in the U.S. District Court for the District of Wyoming, challenging the Bureau of Land Management's final rule; "Waste Prevention, Production Subject to Royalties, and Resources Conservation."


While the rule has been finalized by BLM, it has yet to be published in the Federal Register. As proposed, the rule would regulate venting, flaring, and leaks during oil and natural gas production activities on onshore federal and Indian leases. The regulations would also clarify when produced natural gas lost through venting, flaring, or leaks is subject to royalties, and when oil and natural gas used on site would be royalty-free.

The lawsuit alleges that the final rule seeks to regulate air quality from oil and natural gas production facilities on non-federal lands, which the plaintiffs allege is a function delegated exclusively to the U.S. Environmental Protection Agency. The lawsuit also alleges that the final rule is an abuse of discretion, arbitrary and capricious, not supported by the administrative record, and procedurally deficient.
Thursday, November 17, 2016

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