Oil and Gas | KUNC

Oil and Gas

As the coronavirus pandemic hammers oil prices, the number of "orphaned" or abandoned oil wells could grow. A group wants to enlist newly unemployed oilfield workers in addressing the problem.

 


Courtesy Mark Cleveland

When Mark Cleveland took a job as an electrician for a Denver-based fracking company four years ago, he did it for the money. E-techs, as they're known, can make upwards of $70,000 a year.

"It's hard to find a job where you can have a single income and pay your bills and not worry about living check-to-check," he said. "It wasn't what I expected to be doing by any means, but it worked out."

But in early April, Cleveland got laid off. The cuts were "in response to current market conditions," his company, Liberty Oilfield Services, said in a notice issued that day.

A federal report out this week shows that the Bureau of Land Management has more than halved the time spent reviewing oil and gas drilling permits, a reflection of how the agency's priorities have shifted under the Trump administration.

On Monday, domestic oil prices dropped more than 200 percent, settling at -$14.05 by day's end; the West Texas Intermediate (WTI) crude oil price benchmark momentarily hit -$40.32. This marks the first time oil prices have ever dropped into the negatives.

There’s been too much oil on the market since well before the coronavirus outbreak. But a recent agreement to cut production won’t be enough to prevent states in the Mountain West from taking a big hit.

 


Saudi Arabia and Russia reached an agreement with other oil-producing nations on Sunday to cut output by 9.7 million barrels per day for the next two months, in an effort to stem a plunge in oil prices brought on by the coronavirus pandemic and feuding between Moscow and Riyadh.

OPEC+, a group that includes OPEC members as well as allied non-members like Russia and Mexico, finalized the deal on Sunday after days of marathon negotiations.

Matt Bloom / KUNC News

José Casillas knew something was wrong based on the number of burritos he was selling. As manager of Mi Gallo Giro, a small Mexican restaurant in Evans, he typically filled five big orders a week for oil and gas companies’ safety meetings, making 50 to 100 burritos for each one.

But last week, two of his regular customers called to cancel their orders. Another cut their request in half.

Oil prices bounced back a bit after President Trump said the Department of Energy would buy crude for the nation's strategic petroleum reserve.

"We're going to fill it right to the top," Trump said Friday in a wide-ranging news conference at the White House. He said it will save taxpayers "billions and billions of dollars" while helping an industry that's been reeling.

While oil prices increased nearly 5% after Friday's announcement, that was just a fraction of the amount they lost earlier in the week.

Weld County (left photo) and the Pipeline and Hazardous Materials Safety Administration (right photo).

State oil and gas regulators are seeking roughly $18 million in fines from the company responsible for the 2017 home explosion in the town of Firestone. It’s the Colorado Oil and Gas Conservation Commission’s largest fine ever issued against an operator, officials said.

Updated at 10:52 p.m. ET

Oil prices and stock indexes were in freefall Sunday after Saudi Arabia announced a stunning discount in oil prices — of $6 to $8 per barrel — to its customers in Asia, the United States and Europe.

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