Powder River Basin News Pulse January 2021

The Powder River Basin| January 2021

Field Overview

The Powder River Basin, known for its coal deposits, is located in Southeast Montana and Northeast Wyoming. The basin is named so because it is drained by the Powder River. Major cities in the area include Gillete and Sheridan, Wyoming and Miles City, Montana. There is a recent resurgence in oil and gas production as a result of horizontal drilling and hydraullic fracturing. This resurgence is occurring mainly in the Wyoming part of the basin, which is historically known as the source of the basin’s oil.


State Drilling Statistics (End of January)

Total Rigs in Wyoming- 5
Total Rigs in United States- 384
Total U.S. Rigs down 56% YTD

State Top Producers

Top Oil Producer- Elephant Operating
Top Gas Producer- Elephant Operating


Basin Highlights

Biden Ban will Defund Schools

While the federal drilling ban has sweeping immediate impacts, Wyoming is perhaps one of the most affected. Because they produce a large portion of their hydrocarbons on federal lands, it is going to be difficult to drill new wells. This means that the state budget was already tight through 2020, and will only grow tighter if reserves can’t be replaced. Wyoming superintendent Jillian Balow claims the ban will decrease funding available to schools. She was surprised with the orders after listening to months of rhetoric on national unity and said, “Funding for public education in Wyoming and other states has been eviscerated by an order issued by Acting U.S. Interior Secretary de la Vega.” Wyoming depends on $150 million in federal royalties from oil and gas annually to support public schools. That doesn’t include the royalties that are raked in to support local government bodies or other public organizations. The superintendent encouraged those who were concerned to speak out against the defunding claiming, “Our students, teachers, and communities simply cannot afford this draconian executive order.”

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Electric Taxation Disagreements

Wyoming policy makers are upset with the new order because they are swimming that happens to be federally owned. Only 10% of oil and gas production in the United States occurs on federal land, but in Wyoming, more than half of oil production is drilled on federal land, along with 92% of natural gas. This contributes to 38% of natural gas produced on federal land nationwide. The Petroleum Association of Wyoming plans to take, “all legal means at our disposal,” to challenge the ban. Sen. John Barrasso said, “Wyoming and other western states have oil and gas lease sales scheduled. Several of these lease sales will be held in the next sixty days. Slowing these projects down will kill jobs for hardworking Americans and reduce a critical source of revenue to states like Wyoming.” Although many are upset with the ban, conservation groups feel that this provides an opportunity to revisit old permitting policies and are excited for a revamp of regulations.

Article Link


Top Oil Producers (2021 cum)

RankCompanyProduction
(Bbl)
1Elephant Operating1,687
2Blake Prod408
3Oildigger Res.234
4Hedges Spencer181
5Four-A Energy129
Hyperlinks to available Q3 2020 Reports

Top Gas Producers (2020 cum)

RankCompanyProduction
(Mscf)
1Elephant Operating2,954
2Oildigger Res.49
3
4
5
Hyperlinks to available Q3 2020 Reports

Refining


Wyoming Oil Production


Wyoming Gas Production


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The information contained in this newsletter is provided by RARE
PETRO Engineering, PLLC via the following sources unless otherwise
noted:

www.eia.gov
www.drillinginfo.com
www.bhge.com
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