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Mick Thomas

Division Administrator – Minerals, Public Trust, and Oil & Gas

Secretary to the Oil & Gas Conservation Commission

This update was sent to the Commission on Saturday, February 6.

Current Items:
2021 Legislative Session
Field Status
Injection Well Update
Quarterly Update
News Article(s) of Interest
Current Prices
Bonus Item

2021 Legislative Session
At the October 2020 meeting the Commission voted to adopt the proposed fee rule as the pending rule for IDPA 20.07.02 Rules Governing Conservation of Oil and Natural Gas in the State of Idaho and authorized the Department to submit a Notice of Adoption of Pending Rule consistent with that adoption.

The pending fee rule for IDAPA 20.07.02 is still pending approval of the 2021 Idaho Legislature. It has been approved by the germane committees and still needs to be approved by a concurrent resolution to become a final rule

If there is no concurrent resolution approving the pending fee rules, then IDAPA 20.07.02 will expire at the end of the 2021 legislative session (because the current rule is a temporary rule). The risk of this happening is the reason the adoption of the 20.07.02 temp rules is on the agenda for the February meeting. This will ensure that IDAPA 20.07.02 remains in effect.

Field Status
As of mid-December 2020, five wells in Willow Field were returned to production for the first time since being shut-in in mid-March of 2020. In addition, the Barlow 1-14 commenced production which marks the first production from the Harmon Field since its 2018 discovery. Production from the six wells averaged 4 million cubic feet of gas per day (MMCFGD), 42 barrels of condensate per day (BCPD) and 6 barrels of water per day (BWPD). Additional wells are expected to be brought back on-line in the next few months.

Injection Well Update
The EPA district 10 legal team has forwarded the operator application to their general counsel in D.C. Anticipated response from EPA Headquarters should be provided back to district 10 by late March or sooner.

Quarterly Update
Monthly production and sales volume reports for the 4th quarter of 2020 are due to be filed by February 14, 2021. Once those are received, the Department will send the final report to the Commission before the end of the month. Additional items of interest: Energy Transport LLC of Ontario Oregon reported to the Department that they have sold their transloading vehicles and equipment to Carson Oil of Portland Oregon as of December 2020. The 2020 Annual Well Report for Idaho has been submitted and is now posted on the Oil & Gas webpage under the Monthly & Annual Reports page:
https://ogcc.idaho.gov/monthly-and-annual-reports/

News Article(s) of Interest
The dark side of green energy and its threat to the nation’s environment
https://www.deseret.com/utah/2021/1/30/22249311/why-green-energy-isnt-so-green-and-poses-harm-to-the-environment-hazardous-waste-utah-china-solar

Western states say Biden oil halt is crushing blow to economy

More oil and gas companies leaning into renewable energy tech
https://www.worldoil.com/news/2021/1/26/more-oil-and-gas-companies-leaning-into-renewable-energy-tech

Oil companies lock in drilling, challenging Biden on climate
https://www.sltrib.com/news/environment/2021/01/11/oil-companies-lock/

Current Prices

Utah Sweet Crude	$46.93 bbl.	02/04/21
WTI	$56.89 bbl.	02/05/21
Natural Gas	$2.91 mmbtu.	02/04/21
NGL	$7.51 mmbtu.	02/04/21

 

Green indicates price increase since last secretary update
Red indicates price decrease since last secretary update

On a personal note – Let me introduce Cooper George Washington Thomas, a.k.a. “Cooper”. Born on December 6 2020 Cooper was brought home yesterday February 5th.
Big thanks to Commissioner Miller (and his dog Rex) for the opportunity to bring him into our family!

 

The 2020 annual well report is now available. Please see the Monthly and Annual Reports page for more information.

The November 2020 monthly report is now available. Please see the Monthly and Annual Reports page for more information.

Mick Thomas

Division Administrator – Minerals, Public Trust, and Oil & Gas

Secretary to the Oil & Gas Conservation Commission

This update was sent to the Commission on Saturday, January 9.

Current Items:
Minerals, Public Trust, Oil & Gas Staff
OGCC Regular Meeting
2021 Legislative Session
Payette Field Update
Injection Well Application
Fall 2020 Inspection Reports
News Article(s) of Interest
Current Prices

Minerals, Public Trust, Oil & Gas Staff
2020 was a year of change for all of us. I would like to share my gratitude for the staff of our Minerals, Public Trust, Oil & Gas Division. Each of them continued to serve the IDL, Land Board, and citizens of Idaho with dedication and a tireless work ethic. I’ve said it before and I’ll say it again, these folks are the best group I’ve ever worked with. We are very fortunate to have them.

OGCC Regular Meeting
The first OGCC regular meeting of 2021 will be held on Wednesday, February 24, 2021 @ 1:30 pm (MT). The location is not yet confirmed since the legislature will be in session and we may still be under CDH orders due to the Covid-19 response. We will provide more information as soon as it is available.

2021 Legislative Session
The 2021 legislative session is set to begin on Monday, January 11, 2021. The Minerals, Public Trust, and Oil & Gas Division does not have any pending items due before the Idaho Legislature this session.

Payette Field Update
In mid-December Snake River Oil & Gas began testing and flowing from existing wells in the Payette Field. As a result, some of the wells have been brought back into production. Below are the highpoints:

• During October and November Snake River Oil & Gas performed maintenance on the producing wells and facilities and re-calibrated all the meters in the field. Production began in mid-December 2020.
• Currently 6 wells are producing approximately 4 MMCF gas per day, 42 BBL condensate per day, and 6 BBL water per day.
• The Barlow #1-14 commenced production for the first time since being drilled and completed in 2018. The well is producing approximately 1 MMCF gas per day with no water.
• The ML Investments #1-3 was producing for approximately 2 weeks before seeing an increase in water production and was shut-in again for evaluation.

As of December 2020, the following wells are producing:

• DJS #1-15
• Kauffman #1-9
• ML #2-10
• ML #1-11
• ML #1-3 (currently shut in for evaluation as of January 2021)
• ML#2-3
• ML #3-10

When the Department receives production reports we will post on the Commission website.

Injection Well Application
In October 2020 the EPA is requested additional information from the operator. Snake River Oil & Gas is providing this information. Once the EPA has evaluated the information from this new request they will release their draft permit decision and aquifer exemption, followed by a public comment process and final issuance of the permit (if applicable). No definitive timeframes have been announced as of this date.

Fall 2020 Inspection Reports
Fall inspection reports have been completed and finalized. They can be viewed on the Data Explorer page as well as the OGCC page at the below links:
ID Data Explorer (idaho.gov)
https://ogcc.idaho.gov/well-files/

News Article(s) of Interest
Quiet cycle – nothing to report.

Current Prices

Utah Sweet Crude	$41.53 bbl.	01/07/21
WTI	$52.61 bbl.	01/08/21
Natural Gas	$2.60 mmbtu.	01/06/21
NGL	$6.50 mmbtu.	01/06/21

 

Green indicates price increase since last secretary update
Red indicates price decrease since last secretary update

Mick Thomas

Division Administrator – Minerals, Public Trust, and Oil & Gas

Secretary to the Oil & Gas Conservation Commission

This update was sent to the Commission on Saturday, December 19.

Current Items:
OGCC Contested Case
October and Biannual Reports
2020 Inspections
Rail Facility Closing
Idaho Geological Survey Advisory Board Meeting
News Article(s) of Interest
Current Prices

OGCC Contested Case
At the December 9th special meeting the Commission initiated a contested case to determining whether the integration order in Docket CC-2016-OGR-01-001 applies to the permitted proposed Barlow #2-14 well. Additional information can be found below:
https://ogcc.idaho.gov/administrative-hearings/docket-no-cc-2020-ogr-01-003-integration-order-cc-2016-ogr-01-001-and-barlow-2-14/
The Department and the Deputy Attorney General’s office are working to appoint a hearing officer soon.

October and Biannual Reports
The biannual well test report and October production reports are posted.
Monthly & Annual Reports | Oil & Gas Conservation Commission (idaho.gov)
There has been no production from the field since March 2020. Shut in pressures are stable.

2020 Inspections
Fall field inspections took place on November 24, 2020. The field is still shut in with no production. There were no abnormalities found, and the inspection reports are being finalized.

Rail Facility Closing
Energy Transport LLC. provided official notice that they have closed the rail loading facility in Ontario. The rail cars and trucks have been sold. The facility was built at a cost of approximately $2M USD in anticipation of liquid production from the Payette field.
On a side note, the Commission appreciates the transparency and cooperation received from Energy Transport LLC in our audit of the former operator. We were able to account for the sale of liquids that had previously been unreported by the prior operator.

Idaho Geological Survey Advisory Board Meeting
Wednesday December 16th was our IGSAB annual meeting. Among other information shared the IGS provided new research on the source and potential of the Payette Field. We plan on inviting IGS staff to a future Commission meeting to share the findings.

News Article(s) of Interest
Idaho Power accelerates coal abandonment in favor of Oregon wind and solar power source. See below link and attached E&E Idaho Grid.pdf

LNG Exports increase
The Great American LNG Comeback | Rigzone

Texas: Value of West Texas oil lands plunging amid virus pandemic
https://apnews.com/article/pandemics-houston-coronavirus-pandemic-texas-3197940449cf06f79d5239ec643f6943

Current Prices

Utah Sweet Crude	$38.52 bbl.	12/16/20
WTI	$49.03 bbl.	12/18/20
Natural Gas	$2.67 mmbtu.	12/16/20
NGL	$5.60 mmbtu.	12/16/20

 

Reminder: The Secretary Update has been moved to a monthly schedule. We plan to provide the next update the week ending Friday, January 8th.

The October 2020 monthly report is now available. Please see the Monthly and Annual Reports page for more information.

The September 2020 monthly report is now available. Please see the Monthly and Annual Reports page for more information.

Mick Thomas

Division Administrator – Minerals, Public Trust, and Oil & Gas

Secretary to the Oil & Gas Conservation Commission

This update was sent to the Commission on Saturday, November 14.

Current Items:
Interstate Oil and Gas Compact Commission Annual Meeting
Sec. Update Moving to Monthly
News Article(s) of Interest
Current Prices

Interstate Oil and Gas Compact Commission Annual Meeting
Tuesday November 3rd was the end of my two-year appointment as the chair of the Council of Regulatory Officials for the IOGCC. The CRO consists of the official representatives from all IOGCC member states. We meet twice annually to discuss how states can provide the best regulatory framework for industry, while protecting natural resources and the economy.

Special Findings of the CRO from Member States:
Overall production has stabilized after the drop off caused by the Covid-19 response. Rig counts are down ~50% nationwide. Permitting is down on average 35%. Staffing has stabilized after initial layoffs in summer 2020. Most states are currently short staffed.
Positives: Many states are taking advantage of the increased contractor labor pool to P&A orphaned wells. This keeps folks working and addresses that long-term need. Many states are evaluating a transition to a carbon free future as new laws are on the horizon from their respective legislatures.

Sec. Update Moving to Monthly
We will continue to offer secretary updates to the Commission but will be moving the frequency to monthly rather than every two weeks. If time sensitive information needs to be shared, I’ll reach out to the Commission accordingly.

News Article(s) of Interest
CAIA founder and activist Shelley Brock loses in first legislative run. Conservatives increase majority.
https://www.idahopress.com/news/elections/idaho-gop-flips-2-statehouse-seats/article_f6005e2c-4760-5543-8f9e-6d08fe1351bd.html

LOUSIANA Prolonged trend of low prices combined with potential increase in regulations results in closure of Louisiana refinery.
https://www.reuters.com/article/us-refinery-operations-shell-convent-idUSKBN27L2RI
COMMENTARY: Limited refinery capacity was a major contributor in the high gas prices we saw 10-12 years ago. The Covid response has flipped this.
The last time a refinery was built in the U.S. was 1977. Time and cost estimates to permit and build a new refinery are ~20 years at a cost of two billion USD.
Refiners have moved to a more immediate business model. This limits the likelihood of additional refining infrastructure.

UTAH natural gas/hydrogen power plant seeks permit expansion. Potential demand for NW gas.

Current Prices
(Colors indicate spot price change since last update. Green indicates increase. Red indicates decrease.)

Utah Sweet Crude	$31.82 bbl.	11/12/20
WTI	$40.12 bbl.	11/13/20
Natural Gas	$3.03 mmbtu.	11/11/20
NGL	$5.38 mmbtu.	11/11/20

Mick Thomas

Division Administrator – Minerals, Public Trust, and Oil & Gas

Secretary to the Oil & Gas Conservation Commission

This update was sent to the Commission on Saturday, October 31.

Current Items:
Application for Permit to Drill
News Article(s) of Interest
Current Prices

Application for Permit to Drill
At the October 20, 2020 regular meeting, the OGCC voted to grant the Application for Permit to Drill, Barlow #2-14. The meeting video and Final Order can be found on the Well Permit Applications page.

2020 Inspections
The field has been shut in since early spring. Final 2020 inspections will be completed in November.

News Article(s) of Interest
Officials approve the construction of 12 small nuclear reactors to be built in Boise. The intended use is for repurposing coal plants in the Northwest. (Nuclear energy provides carbon free baseload that Wind/Solar cannot provide.)
https://www.boisestatepublicradio.org/post/small-nuclear-reactors-would-provide-carbon-free-energy-would-they-be-safe#stream/0

Army Corps wetland database needs updated but is still being used.
see attached pdf: E&E WOTUS wetland data

Shipping LNG from Rocky Mountain States to China is revisited.
see attached pdf: natural gas

Current Prices
(Colors indicate spot price change since last update. Green indicates increase. Red indicates decrease.)

Utah Sweet Crude	$26.87 bbl.	10/29/20
WTI	$35.72 bbl.	10/30/20
Natural Gas	$3.06 mmbtu.	10/28/20
NGL	$5.15 mmbtu.	10/28/20

Mick Thomas

Division Administrator – Minerals, Public Trust, and Oil & Gas

Secretary to the Oil & Gas Conservation Commission

This update was sent to the Commission on Saturday, October 17.

Commissioners,

In light of Tuesdays meeting this update is brief. The meeting agenda is posted on the OGCC website within the meetings and hearings section.
https://ogcc.idaho.gov/

Current Items:
News Article(s) of Interest
Current Prices

News Article(s) of Interest
CAIA president Shelley Brock running against republican Gayann DeMordaunt, campaign signs continue to be vandalized.
https://idahonews.com/news/local/congressional-candidate-speaks-out-about-campaign-sign-vandalism

Wyoming court overturns federal rule limiting methane emissions
https://trib.com/business/energy/wyoming-court-overturns-federal-rule-limiting-methane-emissions/article_cbb814dd-5e75-5cf8-9a6b-317fc57aacab.html

Current Prices
(Colors indicate spot price change since last update. Green indicates increase. Red indicates decrease.)

Utah Sweet Crude	$31.66 bbl.	10/16/20
WTI	$40.29 bbl.	10/16/20
Natural Gas	$2.03 mmbtu.	10/14/20
NGL	$5.05 mmbtu.	10/14/20