Energy Update: Basic Energy sees rig use dropOctober 21, 2013
Join The Discussion
Basic Energy Services Inc. of Fort Worth has reported fewer well-servicing rig hours, dropping from 79,200 in August to 69,300 in September.
Meanwhile, the oil and gas well-services company saw lower rig use, with the rate dropping from 77 percent in August to 71 percent in September. The 71 percent rate was the same as in September 2012, according to the company’s newest report on September 2013 activity.
Rig usage rates reflect the percentage of a company’s rigs in use.
“Our outlook for the fourth quarter indicates that revenue will be down about 6 percent to 7 percent sequentially due to the seasonal factors, which typically occur in the fourth quarter of each year,” said president and CEO Roe Patterson in a news release.
“Due to the seasonal slowdown, lower utilization levels could increase competitive pressure in some markets that are already crowded,” said Patterson, predicting that pricing and margins could be affected as the company competes to maintain market share.
Basic Energy Services, which provides oil and gas well-site services, employs more than 5,500 workers in Arkansas, Kansas, Louisiana, New Mexico, Oklahoma, Texas and the Rocky Mountain and Appalachian regions. More information is available at
Approach Resources sells
interest in pipeline
Approach Resources Inc. of Fort Worth and project partner Wildcat Permian Services LLC have sold a West Texas oil pipeline for $210 million.
JP Energy Development LP of Irving bought the 50-mile pipeline, hoping to extend its operations into the Southern Midland Basin. Approach’s cash proceeds are expected to total about $108 million before taxes. The pipeline can carry up to 100,000 barrels of oil per day.
Approach’s president and CEO, J. Ross Craft, announced the sale in September, saying it benefits all three companies.
“The sale of our oil pipeline provides a strong return on our initial investment, further strengthens our liquidity position and continues to provide firm crude oil takeaway from our core operating area,” said Craft. He praised Wildcat while looking forward to his company’s new partnership with JP Energy and its management team.
Approach Resources Inc. is an independent oil and gas company with core operations, production and reserves in West Texas’ Permian Basin. It operates about 152,000 net acres in that region. More information is available at www.approachresources.com.
Oil-gas employment reaches 1 million in 2013, report says
The nation’s oil and gas industry has shown strong employment in 2013, according to a new report by the Texas Independent Producers & Royalty Owners Association in Austin.
In the first half of 2013, the industry added 23,700 net jobs, for a net growth rate of 2.4 percent, according to the mid-year analysis of U.S. oil and natural gas employment data.
Between June 2012 and June 2013, industry employment rose by 2.6 percent, faster than the nation’s overall private sector. Oil and gas extraction, drilling and support activities made up most of that growth.
The report examined nine primary sectors that make up U.S. oil and gas industry, finding growth in all sectors except in oil and gas field machinery and equipment.
“The U.S. oil and gas industry continues to flourish, adding over 177,500 jobs since 2010,” said Ed Longanecker, TIPRO president, in a news release.
“The positive economic impact of our industry is unmatched, with Texas leading the country in oil and gas production, innovation and employment trends,” said Longanecker. He credited the state’s favorable business and regulatory climate.
Information from the TIPRO report was culled from the U.S. Bureau of Labor Statistics’ current employment survey. Data are preliminary and not adjusted for seasonal variances. A copy of the report may be downloaded at www.tipro.org/newsroom/other-energy-reports.
Enterprise Products eyes
higher pipeline capacity
Enterprise Products Partners LP plans to expand its wholly owned Aegis Pipeline following what it calls strong interest from shippers.
Long-term agreements have been executed, according to the Houston-based company, which support increasing the size of the pipeline from 16 inches to 20 inches in diameter. That would allow delivery of up to 425,000 barrels per day of ethane to the petrochemical corridor along the Texas Gulf Coast.
Originating at Enterprise’s Mont Belvieu storage complex near Houston through connections with other company-owned pipelines, the 270-mile Aegis is expected to deliver purity ethane to ethylene production facilities between Beaumont and Napoleonville, La.
The pipeline will begin service in phases, with initial deliveries expected to begin during the second quarter of 2014.
“Interest continues to build as shippers recognize the value Aegis offers through enhanced flexibility, supply diversification and market access,” said A.J. (Jim) Teague, chief operating officer of Enterprise’s general partner, commenting in a news release.
To accommodate shipper interest, Enterprise is holding a supplemental open season from Oct. 14 through Nov. 14 at 5 p.m. For commercial inquiries and additional information, contact Russ Kovin at 713-381-7925 or firstname.lastname@example.org.
Enterprise Products Partners LP provides midstream energy services to natural gas consumers and producers. Its assets include about 50,000 miles of onshore and offshore pipelines, 200 million barrels of storage capacity for natural gas liquids and 14 billion cubic feet of natural gas storage capacity.
More information is available at www.enterpriseproducts.com.
Send energy news to A. Lee Graham at email@example.com