OPEC+ Reach Deal to Cut Production by 9.7 Million BPD

Over the weekend, a coalition of nearly two dozen oil-producing countries agreed to withhold 9.7 million barrels a day from markets. Members of OPEC and others, including Russia and Mexico, announced Sunday that they have agreed to cut production in May and June. This is reported to be the the deepest cut ever agreed to by OPEC+. After the production cuts, the group will again ramp up production until the agreement expires in April 2022.

It is unclear if this level of coordinated cuts is enough to erase the glut given the decline in global demand spurred by the spread of the novel coronavirus. According to the Wall Street Journal, Global demand for crude is normally around 100 million barrels a day. Estimates of the decline vary widely and change daily, but most put current demand at 65 million to 80 million barrels a day. In volume and percentage, the fall exceeds the collapse of 1979 to 1983. It occurred over four weeks, not four years. (View the full article in the WSJ)

“The global oil industry is experiencing a shock like no other in its history,” said Fatih Birol, executive director of the International Energy Agency.

According to the EIA, U.S. petroleum product consumption has gone from 21.86 Million BPD on March 6th,2020 to 14.46 Million BPD on April 3rd, 2020. 

US_Crude_Consumption.PNG

Add your reaction Share

U.P. Energy Taskforce to Finalize and Submit Propane Recommendations to the Governor by April 17th

This week, the U.P. Energy Taskforce will finalize its propane recommendations with a deadline of April 17 to submit the report to the Governor. More than 800 public comments were received. The final recommendations, technical document and appendices will be posted to Michigan.gov/UPEnergyTaskForce.

The Michigan Oil and Gas Association has submitted comments on the The U.P. Energy Task Force's draft recommendations related to the U.P.'s propane supply. The Task Force's 14 draft recommendations to the Governor on propane availability in the Upper Peninsula can be found here, in addition to the technical report prepared by Public Sector Consultants on propane supply and possible impacts if delivery were to be interrupted. 

View MOGA's Comments on the UP Energy Task Force Committee Recommendations Part_1. Propane Supply Here

A full report on overall U.P. energy issues and alternatives is due to Gov. Whitmer by March 31, 2021.

Add your reaction Share

The 4 Primary Measures Gov. Whitmer will use to Safely Re-Engage the State's Economy

In her Monday press conference, the Governor said,  "Every day, we are writing the plan so that we can re-engage safely at the appropriate time with the idea that not one of us wants to go through this again.Those days where we can resume some normalcy – they are on the horizon," she said. "We keep doing what we need to do to get past this moment."

The four primary factors the administration will consider include the following, 

  • Infections rates must be down.
  • The ability to test the coronavirus must improve.
  • The state's healthcare system's capacity must be adequate.
  • Businesses would need to adopt "best practices in the workplace.

Dr. Joneigh Khaldun, the state's chief medical executive, said it's a mix of things and not necessarily "zero cases," but that the right amount of testing is going on, the rate of increases in cases goes down, and that hospitals are ready in case there's a surge of cases after the social distancing measures are lifted.

Add your reaction Share

Governor Whitmer has extended the "Stay Home. Stay Safe Order" by issuing a new Executive Order, 2020-42. Effective through April 30th.

Governor Whitmer has extended the "Stay Home. Stay Safe Order" by issuing a new Executive Order, 2020-42. This Order re-affirms the measures set forth in Executive Order 2020-21 (and replaces the Order), extending the "stay home, stay safe" measures through April 30, 2020.

In the Governor's press release, she says "The measures put in place by Executive Order 2020-21 have been effective, but this virus is both aggressive and persistent: on April 8, 2020, Michigan reported 20,346 confirmed cases of COVID-19 and 959 deaths from it. To win this fight, and to protect the health and safety of our state and each other, we must be just as aggressive and persistent. Though we have all made sacrifices, we must be steadfast. Accordingly, with this order, I find it reasonable and necessary to reaffirm the measures set forth in Executive Order 2020-21, clarify them, and extend their duration to April 30, 2020. This order takes effect on April 9, 2020 at 11:59 pm. When this order takes effect, Executive Order 2020-21 is rescinded". 

The order will continue to prohibit public and private gatherings among people outside a single household, and orders individuals to stay home unless their work or activity is deemed essential.

Notable changes from the original "Stay Safe, Stay Home" Order include limiting travel between two residences in the state. People will have through April 10 to travel to another residence in the state, after which point the travel will be deemed unnecessary until the order expires.

Another new addition to the order requires large stores to limit the number of people in the store at one time to no more than 4 customers for every 1,000 square feet of customer floor space. Small stores must limit capacity to 25 percent of the total occupancy limits, including employees, under fire codes.Stores will be required to establish lines with markings to ensure six feet of social distancing while customers wait to enter the store. Areas of the store dedicated to carpeting, flooring, furniture, garden centers, plant nurseries or paint must close or remain closed.

View the Full Executive Order Here

 

 

Add your reaction Share

U.P. Energy Task Force to begin next phase of energy analysis, hosting virtual public meeting on April 13th Monday

EGLE_Logo_with_Falls.jpg

U.P. Energy Task Force to begin next phase
of energy analysis

Public urged to participate in Monday's meeting

With recommendations on propane availability in the Upper Peninsula being finalized for submission to Governor Gretchen Whitmer, the U.P. Energy Task Force is launching the second phase of its analysis of the U.P.’s energy needs now and in the future.

The Task Force will meet 10 a.m. to noon on Monday, April 13, using Microsoft Teams video conferencing. The Task Force meeting is being held in accordance with Gov. Gretchen Whitmer and the Michigan Department of Health and Human Services’ recommendations designed to help prevent the spread of Coronavirus Disease 2019 (COVID-19).

Monday’s meeting is open to the public. To participate, go to Michigan.gov/UPEnergyTaskForce for the Microsoft Teams meeting link or, if participating by phone, a dial-in number and conference ID.

The Task Force on Monday will finalize its propane recommendations with a deadline of April 17 to submit the report to the Governor. More than 800 public comments were received. The final recommendations, technical document and appendices will be posted to Michigan.gov/UPEnergyTaskForce.

The Task Force next will begin its discussions about how to fulfill the Governor’s request in her Executive Order to formulate alternative solutions for meeting the U.P.’s energy needs, with a focus on security, reliability, affordability and environmental soundness. The Governor also asked the Task Force to identify and evaluate potential changes that could occur to energy supply and distribution in the U.P.; the economic, environmental and other impacts of such changes; and alternatives for meeting the U.P.’s energy needs due to such changes.

Public feedback is encouraged in a number of ways: comment at Monday’s meeting and future meetings, emailed to EGLE-UPEnergy@Michigan.gov or mailed to U.P. Energy Task Force, c/o Michigan Dept. of Environment, Great Lakes, and Energy, Attn. James Clift, Deputy Director, P.O. Box 30473, Lansing, MI 48909.

A report on overall U.P. energy issues and alternatives is due by March 31, 2021.

Add your reaction Share

MI Senate Workgroup Formed to Focus on Transition Back to Work

Senate Majority Leader Mike Shirkey (R-Clarklake) and Senator Ken Horn (F-Frankenmuth) announced on Tuesday, April 7th, the formation of the “Safe Behavior for Safe Workplaces” Senate workgroup which will work together with business leaders, medical professionals and citizens to develop a plan to bring more workplaces back online when it is safe to do so.

“Our goal is to have recommendations to the Governor by April 17. This is an aggressive goal, but we feel it is important to have solid recommendations in place to be ready when the risk level in our state decreases,” said Shirkey.

Watch a Message from Senate Majority Leader Mike Shirkey

Horn said the panel will put forth a set of recommendations to Whitmer on protocols the state may want to require businesses to follow in terms of workplace sanitization and continued social distancing.

"We're bringing a bottom-up look at this instead of a top-down look," said Sen. Ken Horn, R-Frankenmuth, who is chairing the workgroup.

The other senators on the workgroup will include Sen. Wayne Schmidt, R-Traverse City; Sen. Curt VanderWall, R-Ludington; Sen. Stephanie Chang, D-Detroit; Sen. Sylvia Santana, D-Detroit; and Sen. Jeremy Moss, D-Southfield.

 

Add your reaction Share

Enbridge Files Joint Permitting Application with EGLE and USACE

Enbridge has filed environmental permitting applications for the Great Lakes Tunnel project with Michigan Dept. of Environment Great Lakes and Energy (EGLE) and the US Army Corps of Engineers (USACE).

The permit filing will keep the project on schedule and moving forward.  While the tunnel is constructed, the safe and continued operation of the existing Line 5 pipeline, is essential to Michigan's oil and gas industry and the small, local businesses who depend on consistent access to the pipeline to ship their product.

The design of the tunnel hasn’t been finalized, but the permit application outlines an 18-foot to 21-foot diameter tunnel running 60 to 250 feet below the lake bed. Work will begin on about 25 acres in the Lower Peninsula and move north to an about 16-acre Enbridge-owned parcel in the Upper Peninsula.

Livonia-based Jay Dee Contractors Inc. and Obayashi Corp. will construct the tunnel, while Arup will handle engineering and design.

Given the importance of Line 5 to Michigan’s communities, our economy, and the survival of our businesses, its encouraging to see that the tunnel project is on schedule and that Enbridge anticipates construction to be underway as early as the end of 2021. 

Additionally, Enbridge has created more fact sheets on the tunnel project:

How a Tunnel Boring Machine Works

Investing in Michigan's Future 

Add your reaction Share

The Minerals Management Section (MMS) of the DNR is now able to accept electronic payments via ACH or EFT for royalty, shut-in, and rent payments

The Minerals Management Section (MMS) of the Department of Natural Resources (DNR) is pleased to announce that they are now able to accept electronic payments via ACH or EFT for royalty, shut-in and rent payments.  Please email Heidi Parker (parkerh2@michigan.gov) if you'd like to pay via ACH or EFT. She will walk you through the set up and can answer any questions.  MMS has also recently updated their payment forms.  The new forms can be found on the MMS website. 

Add your reaction Share

Attorney General Nessel Comments on UP Energy Task Force Report on Propane, Urges Prompt Planning to Prepare for Shutdown of Enbridge Line 5

Michigan Attorney General Dana Nessel submitted comments on the draft report recently released by Gov. Gretchen Whitmer’s UP Energy Task Force, in which she urges prompt planning to prepare for a shutdown of Line 5. 

“It is imperative that our state is prepared to implement a cost-effective replacement of propane supplies currently provided by the natural gas liquids the Line 5 pipeline transports,” said Nessel. “The Governor's UP Energy Task Force is  focusing on the steps necessary to ensure we meet the energy needs of all Michiganders for generations to come and I commend the task force for their prompt work on this issue.”  

In her comments, the Attorney General argues that the technical report shows that shutting down Line 5 need not cause propane shortages or large price spikes, because of the identification of a number of robust and diverse alternative supply options for delivery to the Michigan market such as transporting propane by rail from other supply hubs. Additionally she notes that supply disruptions will likely result in only modest wholesale price increases. 

Add your reaction Share

MOGA Submits Comments to the U.P Energy Taskforce in Support of Line 5

The Michigan Oil and Gas Association has submitted comments on the The U.P. Energy Task Force's draft recommendations related to the U.P.'s propane supply. The Task Force's 14 draft recommendations to the Governor on propane availability in the Upper Peninsula can be found here, in addition to the technical report prepared by Public Sector Consultants on propane supply and possible impacts if delivery were to be interrupted. 

According to the U.P. Energy Task Force, the draft recommendations suggest actions the Governor, Legislature, and state agencies can take to better track and anticipate supply and distribution, increase storage capacity, bolster supply infrastructure, minimize disruption impact, consumer protections, and provide a more cohesive plan for those who are disproportionately affected by high energy costs in the U.P.

The public comments comments will be shared with U.P. Energy Task Force members for possible inclusion into the final report, which is due to Gov. Gretchen Whitmer by April 17.

View MOGA's Comments on the UP Energy Task Force Committee Recommendations Part_1. Propane Supply Here

A full report on overall U.P. energy issues and alternatives is due to Gov. Whitmer by March 31, 2021.

Add your reaction Share

Michigan Petroleum Directory Now Available!