US oil drillers idled five rigs in the week ended Friday, bringing the total number of oil rigs to 763, according to Baker Hughes. The rig count decline for the second time in three weeks signals a reversal of the drilling rebound in response to low oil prices.
An increasing number of small US oil companies, particularly in California and Oklahoma, are dumping hydraulic fracturing projects in favor of conventional oil drilling as producers seek higher returns with lower risk at reduced costs compared with shale. Drilling a conventional well usually costs less than $1 million, whereas the average shale well requires between $6 million and $8 million.
Crude markets are experiencing lower volatility as a growing consensus emerges that the price for West Texas Intermediate will hold around $50 per barrel until the next upset to the system, according to Morningstar Director of Oil and Products Research Sandy Fielden. He said this consensus will help Permian Basin producers "better plan their production and identify opportunities to expand where costs are low enough to justify that."
The 2nd US Circuit Court of Appeals ruled against the Constitution Pipeline on Friday, saying that New York's Department of Environmental Conservation acted within its authority when it denied a water quality permit last year. The company sued the state in May 2016, arguing that the DEC's rejection of the permit was "arbitrary and capricious."
Minnesota-based Malamute Energy is determined to develop the Umiat oilfield on Alaska's North Slope despite the risks and challenges it would face, such as the permanently frozen oil reservoir, lack of infrastructure, terrain and remoteness. Undaunted by the fact that the previous owner, Linc Energy, went bankrupt in the process of developing the Umiat and other Alaska projects, Malamute believes the prospect -- estimated to hold 200 million barrels of potentially recoverable oil -- could be well worth the effort.
Lawyers for the US Army Corps of Engineers made a court filing last week urging US District Judge James Boasberg to keep oil flowing through the Dakota Access Pipeline while the agency completes an additional environmental review. "There is a serious possibility that the Corps will reaffirm its original conclusions based in part on its conclusion that the pipeline segment under Lake Oahe is highly unlikely to spill into the lake," the court filing said.
France-based Total plans to buy Denmark-based Maersk's oil unit for $7.45 billion. Total says the deal, which may be completed in the first quarter of next year pending regulatory approvals, will make the company the second-largest oil producer in the North Sea.
NASA scientists are looking at a way to drill into the supervolcano under Yellowstone National Park to prevent it from erupting. The plan would use high-pressure water jets to extract heat from the underside of the volcano's magma chamber.
Southern California may lose two-thirds of its beaches by the end of the century because of storms and rising seas caused by climate change, along with dams that prevent the flow of sand, according to the US Geological Survey. The erosion presents problems for structures along the shores, says geologist Patrick Barnard, the report's author.
Underground hot spots -- areas where magma rises to produce volcanoes -- move more slowly than previously thought, a study shows. Geophysicists examined the average motion of hot-spot groups by plate and say the groups can be used in determining how plates move in Earth's mantle.
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