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U.S. third quarter drilling picks up slightly

Despite continuing at a sluggish pace compared with a year ago, U.S. drilling activity rebounded somewhat in the third quarter, with total well completions up 10.2 percent from the second quarter, according to the American Petroleum Institute’s third quarter 2009 drilling estimates.

Still, the estimated total number of oil wells, natural gas wells, and dry holes completed in the quarter – 8,856 – was down 46 percent from 2008’s third quarter and remained at levels not seen since 2003-2004 (API’s 2009 Quarterly Well Completion Report: Third Quarter.)

Natural gas continues to be the primary target for domestic drilling, with an estimated 4,097 natural gas wells completed in the third quarter of 2009. This was down 49 percent from 2008’s third quarter, the most severe quarterly decline for natural gas plays in this decade.

Oil well completion activity also was well below last year, with the 3,660 estimated completed oil wells in the third quarter down 44 percent from the same period of 2008.

API also reported total estimated footage of 50,716,000 feet drilled in the third quarter of 2009, a 53 percent decrease from third quarter 2008.

“Cash for Clunkers” and the changing transportation habits in America

According to a recent report from the U.S. Department of Transportation, the “Cash for Clunkers” program generated nearly 700,000 sales, resulting in a 58 percent fuel efficiency improvement across the vehicles that were replaced.

Among U.S. adults, 8% bought a new car during the “Cash for Clunkers” program period. Among those who bought during this period, three in five (60%) would not have made a purchase if the program were not in place. This includes 35% who were not in the market and 25% who were in the market, but purchased sooner as a result of the program. There was a small percentage (8%) for which the program was during the time frame they were planning to purchase, and they were able to take advantage of the program. The remaining one-third (32%) did not utilize the program, likely due to not having a vehicle that qualified.

These are some of the findings of The Harris Poll, a new nationwide survey of 2,184 U.S. adult vehicle owners surveyed online between September 8 and 15, 2009 by Harris Interactive.

As seen by Cash for Clunkers, the garages of America are beginning to change. They are consisting of slightly more used vehicles, more fuel efficient vehicles, and in some cases,

simply fewer vehicles. During the past 6 months, 6% of Americans reduced the number of vehicles in their household, 5% sold a vehicle to buy a smaller more fuel efficient vehicle, and 2% sold a vehicle to buy a hybrid or alternative fuel vehicle.

The Harris Poll found several other key points of interest related to American’s driving habits:

  • Americans made cuts into their vacations, likely by either taking vacations closer to home or just taking fewer vacations. Slightly more than one in five (22%) indicated they chose to not take a vacation that involved driving.
  • Alternative forms of transportation are also continuing to make gains. Just over one in ten (11%) indicated they took public transportation more than usual, and 8% rode a bicycle more than usual. In a nod to good health along with bicycling, almost one in five (18%) Americans are walking to destinations more often.
  • When it comes to getting to and from work, 13% are car-pooling and 8% are telecommuting rather than going to the office.

Holly Corporation announces definitive agreement to acquire Sinclair's Tulsa refinery

Holly Corporation recently announced today that it has entered into a definitive agreement with a subsidiary of Sinclair Oil Corporation to purchase Sinclair's Tulsa refinery.

Under the terms of the agreement, Holly will purchase Sinclair's 75,000 barrel per day (bpd) refinery located in Tulsa, Oklahoma, including its approximately 2.3 million barrels of storage, for $128.5 million comprised of $54.5 million in cash and $74 million in Holly common stock. Holly will also purchase the refinery's inventory of approximately 500,000 barrels at the time of closing at market value. Holly plans to integrate this facility with its existing 85,000 bpd Tulsa refinery.

At closing Sinclair and Holly will enter into a long-term agreement under which Holly will provide up to 50,000 bpd of gasoline and diesel fuel to Sinclair to supply Sinclair's extensive branded and unbranded marketing network throughout the Midwest.

Chevron announces California Partnership to invest in education, jobs

Chevron Corporation recently announced the California Partnership, an initiative to invest in education and economic development in its home state. Under the new initiative, Chevron will expand and deepen its partnerships with non-profits focused on supporting underserved communities, including relationships with 18 new non-profit partners providing programs for education, entrepreneurs and job training. Additional partners will be introduced throughout the remainder of 2009.

“Communities in California are facing extraordinary challenges accessing the resources they need to be successful during these turbulent economic times,” said Matt Lonner, manager of Global Partnerships and Programs at Chevron. “ Chevron’s California Partnership is a renewed commitment on the part of our company to work with the organizations that can deliver the programs that our communities need, and invest in the future of our home state.”

The California Partnership represents a $7 million enhancement to Chevron’s community engagement investments in the state, bringing Chevron’s total investments in 2009 to approximately $28 million.

 
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The American Coalition for Ethanol publishes Ethanol Today magazine each month to cover the biofuels industryís hot topics, including cellulosic ethanol, E85, corn ethanol, food versus fuel, ethanolís carbon footprint, E10, E15, and mid-range ethanol blends.
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