The economy has reopened for business, but supply hasn’t kept pace, and that’s causing sticker shock at the pump for many.
In North Dakota, pump prices were averaging $3.118, which is about a dollar more per gallon than the previous year. That price compares favorably to the national average, however, of $3.288 — a seven-year high, according to AAA.
The U.S. has lost some refining capacity, which is also contributing to the high prices.
Surging demand for energy is also affecting crude oil prices, which were trending in the $80 range for WTI on Wednesday. WTI closed Tuesday at $80.52. It hasn’t been that high since Oct. 31, 2014.
Natural gas prices are also up on higher demand and low supply, which could affect homeowners using gas for heat this winter. Around 40 percent of North Dakota homes have gas heat, according to estimates by the U.S. Census Bureau. Montana Dakota Utilities, meanwhile, provides natural gas to 115,000 customers in North Dakota.
MDU is predicting its customers could end up paying on average $170 more to heat their homes this winter due to the energy crunch, according to a report in the Bismarck Tribune.
That’s based on an average winter. Weather forecasters, however, are predicting a La Nina weather pattern, which often means North Dakota is colder and wetter than normal. Though, not always. That didn’t happen during the last La Nina.
MDU has meanwhile taken several steps to insulate its gas prices from crunches like this. For one, it has a lot of stored gas it can draw on from underground reservoirs in Montana. It also has long-term contracts that lock in a certain amount of gas at lower rates.
The company could still have to buy gas at peak times, though, and that is why they are concerned that price increases could ultimately hit their consumers pretty hard this winter.
Utility companies do not make a profit on gas prices directly. It is a pass-through on consumer’s bills.
Help is available for consumers who need help paying their heating bills this winter. North Dakota Department of Commerce has $7.5 million in federal funding for weatherization and repairs for both homeowners and renters. Applications for that are online at www.ndwap.com.
There’s also the federal Low Income Home Energy Assistance Program or LIHEAP, which is also available to both homeowners and renters. Applications for that are online at www.applyforhelp.nd.gov. You can also request an application by letter, or by visiting the Human Service Zone office nearest you.
In Williams County, that’s located in the Administration Building at 110 W. Broadway, Ste. 202. The phone number is 701-774-6300.
Crude Oil release from Strategic reserves
The high prices have the Biden Administration eyeing the nation’s Strategic Petroleum Reserve as a potential way to ease rising prices.
The last time there was a release from the reserves was in 2011, when then President Barack Obama sold 30 million barrels of crude oil to offset supply disruptions caused by unrest in Libya.
Energy Secretary Granholm also mentioned the possibility of banning crude oil exports when she announced the potential release from Strategic reserves.
Critics took the opportunity to point out all the things the Biden administration has done that tend to curtail domestic production and lead to higher prices.
“There is a ripe abundance of North American oil and gas,” Criag Stevens, spokesman for the GAIN coalition said in a media release. “However the Biden administration has blocked the construction of critical energy infrastructure, limited the development of American natural resources, and pushed policies that put U.S. energy security and national security at risk. This week’s events demonstrate that there are real consequences for short-sighted regulations and bad policy.”
New web portal available for rights of way
North Dakota Department of Trust lands has a new, online portal for oil and gas companies and other landowners that will be going live soon for project right of way permissions for things like pipelines.
The new portal was to have gone live in the last week of September, but there has been a delay on completing it. The portal is now likely to go live in late October. It will be a one-stop-shop experience that helps streamline the process of applying for rights of way, and also helps ensure nothing slips through the cracks during the process, Trust Lands Commissioner Jodi Smith told the Williston Herald.
Right now, users submit an application online and then must await communication from the Department of Trust lands. Once the portal goes live, they will be able to log in with a username and password and see where all of their projects are at in the process. The system will also highlight any missing pieces needed to move a project along.
“That way the process can move a little bit quicker,” Smith said. “We’ve also seen when there is an exchange of knowledge that needs to occur, whether somebody has moved on to another position or they’re just no longer with that company. Some things can kind of get lost in that transfer of knowledge. This will make it so it’s a lot easier for them to kind of go into the system and see everything that’s going on themselves instead of kind of having to call into the department, usually waiting for one of us to call back.”
Department of Trust Lands actually redid its website portal in April 2019, but some pieces of the new system were still being put in place. Once everything is ready, the new portal will be accessible 24-7, Smith said, which she believes adds even more convenience for people in the oil and gas industry.
Hess gets AAA on ESG rating
Bakken operator Hess has gotten an upgrade to its ESG rating from AA to AAA with MSCI.
“We are very proud to have received MSCI ESG’s highest rating as a leader in our industry,” said Alex Sagebien, Vice President, Environment, Health and Safety. “Our AAA rating reflects our strong management practices to reduce carbon emissions as well as our top quartile performance in areas such as biodiversity and land use, reduction of air and water emissions and waste, and making a positive impact on the communities where we operate.”
Hess has held a double A rating with MSCI for the last 10 years. It published it’s 245h annual sustainability report in 2021, which is online at tinyurl.com/9247sa2v.
School bus rebates available
The Environmental Protection Agency has two rebate programs available to help school busses replace older diesel school busses. The idea behind the grants is that replacing these older busses will help improve air quality in and around schools and communities.
The rebate programs are the 2021 American Rescue Plan Electric School Bus Rebate and the 2021 Disel Emissions Reduction Act School Bus Rebate. These are online at https://www.epa.gov/dera/rebates.
Application deadlines are through 4 p.m. EST Nov. 5. Questions about applying may be directed to DERA@epa.gov.
Meetings, public comments, & more
Petroleum Tank Release Compensation Fund, special advisory board meeting on Oct. 18. Response period ends Oct. 18. Online at tinyurl.com/kcad5jfd.