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Shannon Chollett

Division Administrator – Minerals, Navigable Waters, and Oil & Gas

Secretary to the Oil & Gas Conservation Commission

This update was sent to the Commission on Friday, June 7, 2024.

June 2024 Secretary Update

Current Items:

New Division Administrator Shannon Chollett
2024 First Quarter Commission Report
IDAPA 20.07.02 Rulemaking Update
Docket No. CC-2024-OGR-01-001, Application for Spacing
Field Status / Injection Well Update
News Article(s) of Interest
Current Prices

New Division Administrator Shannon Chollett
Shannon Chollett has accepted the position of Division Administrator for Minerals, Navigable Waters, and Oil & Gas in Boise and his first day was May 28th. Shannon came from Colorado where he worked as the Western Region Orphaned Well Program Supervisor for the Colorado Department of Natural Resources – Energy and Carbon Management Commission.

2024 First Quarter Commission Report
The 2024 First Quarter Commission Report is included as an attachment to the Secretary Update. Please feel free to reach out to me if you have any questions.

IDAPA 20.07.02 Rulemaking Update
Negotiated rulemaking concluded on Friday, May 31st. A third draft was posted to the OGCC web page May 16, 2024. Public comment on the third draft was available to the public at the May 21, 2024 Commission meeting, but no comments were received at that time. The Department is working on completing summaries of the meeting and finalizing the Perspective Analysis Form (PAF) for DFM by June 21, 2024. More information on the details of the meetings, rulemaking, and documents are posted on the rulemaking webpage at: https://ogcc.idaho.gov/rulemaking/docket-20-0702-2401-oil-gas/

Docket No. CC-2024-OGR-01-001, Application for Spacing
On April 29, 2024, Snake River Oil and Gas, LLC filed an Application for Spacing with the Department in the Harmon Field area. This case was referred to the Office of Administrative Hearings (OAH). Information regarding this application can be found on the Docket No. CC-2024-OGR-01-001 hearing webpage.

Field Status / Injection Well Update
All production in western Idaho continues to be shut-in due to low natural gas prices. The Class II injection well permit issued by the EPA took effect December 19, 2022. No construction activities have commenced as of this date. The permit expires December 19, 2024.

News Article(s) of Interest
Oil Falls to Four-month Lows in Oversold Territory

BLM to hold Wyoming’s Smallest Oil & Gas Lease Auction in 15 Years

Bill Introduced to Repeal Biden’s Natural Gas Tax

Current Prices

NW Natural Gas (EIA)	$1.32 / million Btu	6/6/2024	(2% / $0.03 increase since previous month)
NGL (EIA)	$7.03 / million Btu	6/6/2024	(5.9% / $0.44 decrease since previous month)
WTI	$78.96 / bbl	6/5/2024	(2.0% / $1.63 decrease since previous month)

The April 2024 monthly report is now available. Please see the Monthly and Annual Reports page for more information.

Informational Bulletin regarding Draft Text #3 posted for IDAPA 20.07.02 Rules Governing Conservation of Oil and Natural Gas in the State of Idaho

More information on this rulemaking can be found at https://ogcc.idaho.gov/rulemaking/docket-20-0702-2401-oil-gas/

The March 2024 monthly report and the first Bi-Annual Well Test Report for 2024 are now available. Please see the Monthly and Annual Reports page for more information.

James Thum, Oil and Gas Program Manager

This update was sent to the Commission on Friday, May 3, 2024.

May 2024 Secretary Update

Current Items:

May OGCC regular meeting
IDAPA 20.07.02 Rulemaking Update
Docket No. CC-2024-OGR-01-001, Application for Spacing
BLM Updates to Fluid Mineral Leasing Process
Field Status / Injection Well Update
News Article(s) of Interest
Current Prices

May OGCC regular meeting
The second regular meeting of the Commission for 2024 will be held on Tuesday, May 21, 2024 at 1:30pm (MT). The meeting will be held at the State Capitol, House Hearing Room, (EW42), Lower Level, East Wing, 700 W Jefferson Street, Boise. More information will be available on the OGCC website on the Commission Meetings page.

IDAPA 20.07.02 Rulemaking Update
Three public negotiated rulemaking meetings were completed in April. The meetings were attended by people both in person and remotely. The Department is currently working on a third draft text to present to the Commission at its May meeting. More information on the details of the meetings, rulemaking, and documents are posted on the rulemaking webpage at: https://ogcc.idaho.gov/rulemaking/docket-20-0702-2401-oil-gas/

Docket No. CC-2024-OGR-01-001, Application for Spacing
On April 29, 2024, Snake River Oil & Gas, LLC filed an Application for Spacing with the Department in the Harmon Field area. Information regarding this application can be found on the Docket No. CC-2024-OGR-01-001 hearing webpage.

BLM Updates to Fluid Mineral Leasing Process
On April 12, the BLM issued its Final Rule for Onshore Oil and Gas Leasing. Highlights include revised processes to minimize conflicts with other uses, implementing updates to rental fees, minimum bids and royalty rates, and revising bond amounts for both leasing and operations. For reactions to the new rule, see links provided in the Articles of Interest section below.

Field Status / Injection Well Update
All production in western Idaho is currently shut-in due to low natural gas prices. Snake River is taking advantage of the downtime to convert all pneumatic controllers at wells and facilities to nitrogen-actuated from natural gas-actuated to comply with new 2024 EPA methane emissions requirements. The Class II injection well permit issued by the EPA took effect December 19, 2022. No construction activities have commenced as of this date. The permit expires December 19, 2024.

News Article(s) of Interest
New BLM rule makes it costlier to drill on public lands:
https://apnews.com/article/oil-gas-drilling-public-lands-interior-climate-ffc88438d6f9c5d48e9a8fc7cffc749a

Price hikes for leasing lands could force industry out of Nevada:
https://thenevadaindependent.com/article/price-hikes-for-leasing-land-for-oil-gas-exploration-could-force-industry-out-of-nevada

American Petroleum Institute weighs in on final NEPA rule:
https://www.rigzone.com/news/api_has_its_say_on_nepa_phase_ii_final_rule-02-may-2024-176616-article/

USA Crude stocks increase more than 7 million barrels week-over-week:
https://www.rigzone.com/news/usa_crude_oil_stocks_jump_more_than_7mm_barrels_wow-02-may-2024-176609-article/

Current Prices

NW Natural Gas (EIA)	$1.29 MMBtu	5/2/2024	(4% / $0.06 decrease since previous month)
NGL (EIA)	$7.47 MMBtu	5/2/2024	(3% / $0.19 increase since previous month)
WTI	$80.59 bbl	5/2/2024	(8% / $6.78 decrease since previous month)

Informational Bulletin and PowerPoint Presentation posted regarding Public Meeting on Draft Text #2 for IDAPA 20.07.02 Rules Governing Conservation of Oil and Natural Gas in the State of Idaho

More information on this rulemaking can be found at https://ogcc.idaho.gov/rulemaking/docket-20-0702-2401-oil-gas/

The February 2024 monthly report is now available. Please see the Monthly and Annual Reports page for more information.

The PowerPoint Presentation for the April 11 and April 15 negotiated rulemaking meetings on Draft Text #1 has been posted for IDAPA 20.07.02 Rules Governing Conservation of Oil and Natural Gas in the State of Idaho.

More information on this rulemaking can be found at https://ogcc.idaho.gov/rulemaking/docket-20-0702-2401-oil-gas/

James Thum, Oil and Gas Program Manager

This update was sent to the Commission on Friday, April 5, 2024.

April 2024 Secretary Update

Current Items:

IDAPA 20.07.02 Rulemaking Update
BLM Updates to Fluid Mineral Leasing Process
Injection Well Update
Field Status
News Article(s) of Interest
Current Prices

IDAPA 20.07.02 Rulemaking Update
The Notice of Intent to Promulgate Rules has been published in the April Administrative Bulletin on the Division of Financial Management webpage here: https://adminrules.idaho.gov/bulletin/2024/04.pdf Three public negotiated rulemaking meetings will be held this month on the 11th, 15th and 29th. More information on the details of the meetings, rulemaking, and documents are posted on the rulemaking webpage at: https://ogcc.idaho.gov/rulemaking/docket-20-0702-2401-oil-gas/

BLM Updates to Fluid Mineral Leasing Process
The public comment period for the BLM’s proposed revisions to the Onshore Oil and Gas Leasing Rule closed September 22, 2023. The BLM continues to analyze and review comments submitted before the September deadline and is expected to issue a final rule in the spring of 2024.

Injection Well Update
The Class II injection well permit issued by the EPA took effect December 19, 2022. No construction activities have commenced as of this date. The permit expires December 19, 2024.

Field Status
Efforts to re-establish production from the Kauffman #1-9 oil zone utilizing a gas lift procedure were unsuccessful and the well was plugged the week of March 18th. The Department has requested that pad reclamation occur by this summer. The Kauffman #1-34 well which has not produced since December 2022 was also plugged the same week. Planned workover operations for the ML Investments #1-11 well have been delayed and the rig was released. This well has a plugging deadline of December 19, 2024.

As of mid-March, Snake River Oil & Gas has shut-in all production in Idaho due to low natural gas prices.

News Article(s) of Interest
Court upholds 2022 Federal oil and gas lease sales

Colorado lawmakers reject proposed drilling ban on new wells after 2030

April 2, 2024 marks the sixty-first anniversary of the first meeting of the Idaho Oil and Gas Conservation Commission

Current Prices

NW Natural Gas (EIA)	$1.35 MMBtu	4/4/2024	(23% / $0.40 decrease since previous month)
NGL (EIA)	$7.28 MMBtu	4/4/2024	(10% / $0.65 increase since previous month)
WTI	$87.37 bbl	4/4/2024	(14% / $10.70 increase since previous month)

 

Informational Bulletin regarding Public Meetings on Draft Text #1 posted for IDAPA 20.07.02 Rules Governing Conservation of Oil and Natural Gas in the State of Idaho

More information on this rulemaking can be found at https://ogcc.idaho.gov/rulemaking/docket-20-0702-2401-oil-gas/