MDN’s Energy Stories of Interest: Tue, May 13, 2025 [FREE ACCESS]
MARCELLUS/UTICA REGION: PA DEP issues RFP for abandoned O&G well plugging services; OTHER U.S. REGIONS: Equinor weighs killing NY wind farm after White House visit; CIP to invest $500 million in BKV CCUS projects; Colorado Supreme Court allows Boulder to sue Exxon, Suncor over climate change; NATIONAL: Oil prices rise on eased trade tensions; Why is the USA natural gas price rising?; Trump proposes slashing DOE budget by $19.3B; JP Morgan says oil demand in early May ‘indicates tepid YoY growth’; Natgas price heats up as futures rally on warmer weather outlook; INTERNATIONAL: Shell profit beats expectations, buybacks kept steady; BP-Shell megadeal would create European rival to Exxon Mobil; After Spain’s blackout, questions about renewable energy are back; Ukrainian parliament ratifies natural resources deal with USA; US, Russia explore ways to restore Russian gas flows to Europe, sources say.
MARCELLUS/UTICA REGION
PA DEP issues RFP for abandoned O&G well plugging services
PA Environment Digest Blog
On May 12, the Department of Environmental Protection issued a Request for Proposals for abandoned and orphan conventional oil and gas well plugging services on a time and materials basis as needed and directed by DEP. Bids are due by June 26. In general, the services to be provided under this RFP include, but may not be limited to, the following: well locating, well-site access preparation, well depth sounding, wire-line logging services, well decommissioning and plugging, and well-site reclamation. Click Here for a copy of the RFP. [MDN: More opportunity for businesses to get a piece of the well plugging pie.]
OTHER U.S. REGIONS
Equinor weighs killing NY wind farm after White House visit
Bloomberg/Rigzone
Equinor ASA, a Norwegian energy company, faces a critical decision on its $5 billion Empire Wind project, halted by the Trump administration in April 2025, with no new signals of reversal following a May 6 meeting between CEO Anders Opedal and White House official Kevin Hassett. The pause, costing $50 million weekly, threatens Equinor’s $2.7 billion investment, with potential losses of $4–4.5 billion if terminated, as warned by analyst Teodor Sveen-Nilsen. The fully permitted Empire 1, designed to power 500,000 homes with 54 turbines by 2027, was stopped by Interior Secretary Doug Burgum, who criticized rushed Biden-era approvals. Equinor, which has invested over $60 billion in the U.S. over nearly 40 years, calls the halt unlawful and is exploring legal options. President Trump’s directive to review offshore wind projects underscores the industry’s challenges, with Equinor’s Molly Morris emphasizing the broader implications for honoring U.S. contracts and investments. [MDN: Nobody wants these bird-and-whale-killing monsters that provide pathetically little electricity for all of the investment and real estate they gobble up. Screw Equinor. Kill it!]
CIP to invest $500 million in BKV CCUS projects
Rigzone
BKV Corp., a Denver-based natural gas and power producer, and Copenhagen Infrastructure Partners (CIP), a Danish energy transition investor, have formed a joint venture to advance carbon capture, utilization, and storage (CCUS) projects in the U.S. BKV will contribute its stakes in current and future CCUS projects, including the Barnett Zero Project in Texas, which has sequestered over 200,000 metric tons of CO2 since November 2023, and the Eagle Ford Project, expected to sequester 90,000 metric tons annually starting in 2026. CIP will invest $500 million for a 49% stake, while BKV retains 51%. The venture aims to leverage BKV’s CCUS expertise and CIP’s low-carbon infrastructure experience to develop investment-ready projects, with BKV as the operator. This partnership supports BKV’s goal of achieving net-zero Scope 1 and 2 emissions by the early 2030s and expands its CCUS business into new markets. [MDN: BKV, which is essentially owned by Thailand’s Banpu, has a sizable exploration and production operation in the northeast PA Marcellus. Increasingly, the company is wandering into other plays and other industries, like CCUS. Misguided, in our humble opinion, but they don’t consult with us. ;-)]
Colorado Supreme Court allows Boulder to sue Exxon, Suncor over climate change
Seeking Alpha
The Colorado Supreme Court has ruled that Boulder County and the City of Boulder can proceed with their 2018 lawsuit against ExxonMobil and Suncor, accusing the oil companies of contributing to climate change and misleading the public about fossil fuels’ environmental impact. The 5-2 decision rejected the companies’ argument that federal law preempts state claims, allowing the case to continue in state court. Boulder alleges that Exxon and Suncor violated Colorado law by exacerbating climate-related damages, such as rising costs for local governments, and seeks financial accountability for these harms. The ruling is seen as a significant victory for local governments pursuing climate accountability, with Boulder Mayor Aaron Brockett comparing it to landmark tobacco litigation. Exxon and Suncor deny wrongdoing, and the case now moves toward the discovery phase, potentially setting a precedent for similar lawsuits nationwide. [MDN: We think it’s past time that people begin suing the courts for their bastardization of the justice system. Sue the individual justices for not doing their jobs correctly. They want lawfare? We’ll give them lawfare and a taste of their own medicine.]
NATIONAL
Oil prices rise on eased trade tensions
Bloomberg/Rigzone
Oil and most commodities surged, while gold declined, as China and the US eased trade tensions that had previously threatened global demand for raw materials. West Texas Intermediate crude rose 1.5% to $61.95 a barrel, copper gained 0.8%, and soybeans, iron ore, and European natural gas also rallied, buoyed by a 90-day trade truce reducing China’s tariffs on US goods from 125% to 10% and US tariffs from 145% to 30%. This de-escalation lifted commodity markets, with mining and energy companies like Glencore, Rio Tinto, Exxon Mobil, and Chevron seeing strong gains. However, gold fell 2.7% as haven demand waned, compounded by reduced India-Pakistan tensions. Despite the optimism, experts warn that lingering trade uncertainties and prior demand damage could cap gains, with oil prices still down over 10% since April due to rising OPEC supplies and volatile market sentiment. [MDN: Isn’t Bloomberg funny? Oil rose and is in the $60s, yet Bloomberg beats the bushes to find a single “expert” who “warns” those prices may still crash and burn. The news in this article that you don’t get until the end is that Brent oil advanced 1.6% to settle at $64.96 a barrel, and WTI added 1.5% to settle at $61.95 a barrel.]
Why is the USA natural gas price rising?
Rigzone
U.S. natural gas prices are rising due to a mix of technical, fundamental, and geopolitical factors, as outlined by industry experts. Art Hogan from B. Riley Wealth noted that prices are trading above the key $3.47 support level, with resistance at $3.72, while tighter supply was reflected in recent American Petroleum Institute data. Reduced rig activity by companies like Diamondback Energy and Coterra Energy may curb future output, further supporting prices. David Seduski of Energy Aspects highlighted a temporary price dip caused by a Freeport LNG outage, which has since resolved, allowing prices to rebound. Additionally, a warmer weather forecast with higher cooling degree days is expected to boost power demand, tightening balances. Phil Flynn from PRICE Futures Group emphasized record LNG exports and supportive EIA reports, alongside anticipated warmer temperatures, as key drivers of the price increase. [MDN: This was an article from the middle of last week. Prices have remained high, closer to $4 than to $3 as they had been. Which is a relief.]
Trump proposes slashing DOE budget by $19.3B
Utility Dive
The White House’s 2026 budget proposal, released on Friday, aims to slash the Department of Energy’s budget by $19.3 billion, targeting significant cuts to the Infrastructure Investment and Jobs Act (IIJA) and the Office of Energy Efficiency and Renewable Energy (EERE). The plan reduces IIJA funding by $15.2 billion, EERE by $2.6 billion, the Office of Science by $1.1 billion, and the Office of Environmental Management by $389 million, resulting in an overall 9.4% cut to DOE funding, or 18.2% excluding the National Nuclear Security Administration, which sees a 25% increase. The proposal eliminates funding for renewable energy, electric vehicle support, and carbon capture initiatives, labeled as “Green New Scam,” redirecting EERE toward early-stage research like bioenergy. While maintaining investments in high-performance computing and artificial intelligence, critics like Rep. Frank Pallone, Jr. warn that these cuts could raise electricity prices and harm low-income households by undermining programs like Justice40 and renewable energy advancements. [MDN: Here’s what stories like this one don’t tell you: That the DOE already had a bloated budget before Biden, and then the Bidenistas went berserk and mortgaged our great great great grandkids’ future with massive increases in the DOE and other agency budgets. The DOE budget for 2024 was $49.3 billion. Cutting it by $19.3 billion represents a 39% cut. Yeah, that’s pretty significant. But it’s warranted. What’s being cut is graft—payments to cronies for “renewable” projects that can’t make it in the open and free market. Time to cut the fat and the graft. Get the ax out!]
JP Morgan says oil demand in early May ‘indicates tepid YoY growth’
Rigzone
In early May 2025, J.P. Morgan analysts, including Natasha Kaneva, reported tepid global oil demand growth, with April consumption flat compared to the previous year and 500,000 barrels per day below expectations, a trend continuing into May. Global oil demand averaged 103.5 million barrels per day as of May 6, up only 280,000 barrels per day from last year, half the anticipated 550,000 barrels per day for May. First-quarter demand grew by 1.6 million barrels per day year-over-year, but economic uncertainty stalled April’s growth. Analysts expect demand to rise with the summer driving season. In early May, OECD commercial oil stocks dropped by four million barrels, driven by a six million barrel decline in oil products, offset by a two million barrel crude increase. Globally, liquid stocks rose by eight million barrels, with Chinese crude stocks surging by 26 million barrels, contributing to a 62 million barrel year-to-date increase. [MDN: Demand goes up, then it goes down, then it goes back up. On an annual basis, it stays about the same or slightly increases. That’s the bottom line.]
Natgas price heats up as futures rally on warmer weather outlook
FX Empire
Natural gas futures surged to a four-week high, settling at $3.795 with a 4.55% weekly gain, driven by forecasts of warmer U.S. weather boosting cooling demand, according to an article on FXEmpire.com. Updated projections from Xweather indicate above-normal temperatures in the eastern U.S. through May 18, increasing electricity demand for air conditioning. However, strong supply and a bearish EIA storage report, showing a 107 Bcf injection, briefly halted the rally midweek. European storage levels at 41% full have had minimal impact on U.S. prices, while improving LNG flows provide bullish support. Technical analysis suggests resistance at $3.825, with potential support at $3.538 if prices retreat. The short-term outlook remains bullish due to hotter forecasts, but traders are cautious as strong supply and storage builds could cap gains unless demand significantly increases. [MDN: We like the price in the high $3 range (or higher). Let’s hope it continues.]
INTERNATIONAL
Shell profit beats expectations, buybacks kept steady
Reuters
Shell reported a first-quarter adjusted net profit of $5.58 billion in 2025, surpassing analyst expectations of $4.96 billion, despite a decline from $7.36 billion in the same period last year, driven by strong operational performance in its integrated gas and downstream divisions. The company maintained its share buyback program at $3.5 billion and kept its dividend unchanged, signaling confidence in its financial stability. Shell’s cash flow from operations reached $9.3 billion, bolstered by higher liquefied natural gas (LNG) sales and robust refining margins, though upstream production saw a slight dip. The results reflect Shell’s strategic focus on high-margin assets and cost discipline amid volatile oil prices. CEO Wael Sawan emphasized resilience in navigating market challenges, with the company advancing its low-carbon initiatives, including investments in LNG and biofuels, to align with long-term energy transition goals while delivering shareholder value. [MDN: The lesson is that Shell returned to its roots of fossil energy, and profits are doing well. Rumors continue to swirl that Shell may buy out and merge with rival BP, a company that lost its way by wandering into a focus on unreliable renewable energy.]
BP-Shell megadeal would create European rival to Exxon Mobil
Bloomberg/Rigzone
A potential acquisition of BP Plc by Shell Plc would create a European oil major rivaling Exxon Mobil and Chevron, with a combined production of nearly 5 million barrels of oil equivalent daily, an 85% increase for Shell. The deal would bolster Shell’s LNG dominance, with sales exceeding 90 million tonnes annually, and enhance its trading and retail operations. However, challenges include BP’s high debt (48% leverage ratio), ongoing Macondo spill liabilities, and a 20% premium on BP’s £57 billion market value. While cost synergies could reach $2 billion annually and free cash flow per share could improve from 2026, competition concerns may necessitate divestitures, particularly in retail and non-core upstream assets. Analysts highlight risks from BP’s financial burdens and Shell’s conservative balance sheet approach, alongside potential obstacles from extensive asset sales, which could undermine the deal’s value for Shell. [MDN: BP screwed itself by focusing on unreliable renewables and now is a target for a takeover. We hope Shell does take it over and take a meat cleaver to the renewables programs in the company.]
After Spain’s blackout, questions about renewable energy are back
Associated Press
A massive power outage on April 28, 2025, affecting the Iberian Peninsula, has sparked renewed debate in Spain over its plan to phase out nuclear reactors by 2035 in favor of expanding renewable energy sources like wind, solar, and hydropower, which generated 57% of Spain’s electricity in 2024. The blackout, which caused a sudden loss of 60% of the grid’s supply, has raised concerns about the stability of renewable-heavy grids, as nuclear power, contributing 20% of electricity, is seen by some as a more reliable energy source despite its controversial radioactive waste. Critics, including Spain’s nuclear lobby, argue for reconsidering the decommissioning plan, citing nuclear’s stabilizing role, while Prime Minister Pedro Sánchez defends the renewable push, noting that nuclear plants online during the outage did not prevent it and were taken offline to avoid overheating. The outage’s cause remains under investigation, with no clear evidence that nuclear power could have averted the crisis. [MDN: That massive blackout happened because of an overreliance on unreliable renewables—in particular, solar. Europe is now reconsidering its stupidity in going all-in on renewable energy. Are they smart enough to change course?]
Ukrainian parliament ratifies natural resources deal with USA
Bloomberg/Rigzone
Ukraine’s parliament overwhelmingly ratified an Economic Partnership Agreement with the United States, granting the U.S. privileged access to investment projects involving Ukraine’s natural resources, such as aluminum, graphite, oil, and natural gas. Supported by 338 lawmakers, the deal aims to strengthen ties with President-elect Donald Trump as he pushes for a swift resolution to Russia’s ongoing invasion, now in its third year. The agreement, finalized after prolonged negotiations, saw the U.S. drop demands for repayment of billions in aid provided to Kyiv. This strategic accord allows the U.S. to benefit from licensing proceeds of Ukraine’s resource development and includes provisions for future U.S. military aid to contribute to a joint investment fund. The ratification reflects Ukraine’s efforts to align with Trump’s administration, particularly as Kyiv seeks to counter Russia’s battlefield advances along a 1,000-kilometer frontline and navigate Trump’s push for a ceasefire that could favor Moscow. [MDN: Looks like Ukraine is finally wising up. It’s time we collected some of the enormous amount of money we’ve dumped into that war.]
US, Russia explore ways to restore Russian gas flows to Europe, sources say
Reuters
The United States and Russia are quietly exploring options to restore Russian natural gas exports to Europe, according to eight sources cited in a Reuters article dated May 8, 2025. Discussions involve U.S. officials potentially facilitating the revival of gas flows, with American investors possibly acquiring stakes in Gazprom or key pipelines to gain leverage over supply volumes, while Russia seeks financial relief. This comes amid strained energy relations due to the Ukraine conflict and Europe’s shift away from Russian gas since 2022. The talks aim to address Europe’s energy needs as U.S. LNG supplies are expected to increase, though no concrete agreements have been confirmed. Some sources suggest the initiative could align with broader geopolitical strategies, but critics, including former U.S. Ambassador Michael McFaul, warn it’s a risky move that could complicate relations further. [MDN: We’re not completely thrilled with this news, IF it’s true. However, Europe continues to buy Russian natural gas and by doing so, financing Russia’s illegal war against Ukraine. If we could get American ownership in some of the pipelines and operations, that would take the sting out of continued Russian gas flowing to Europe.]