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ONE DRILLER’S STORY: Jim Wilkes, president of a small, private Texas shale oil producer in Fort Worth, is still unable to restart production after his wells and other equipment froze at the beginning of the week.
“When you get bunches of wells frozen up, you just have to wait,” Wilkes told Josh in a recent interview. “These are low-volume wells, and things just freeze up.”
Wilkes’ experience represents another trial in the struggles of the Texas oil industry, which had just started to bounce back from the pandemic-fueled price crash.
More than 4 million barrels a day of output — almost 40% of the nation’s crude production — was offline this week, according to Bloomberg. The winter storm knocked out as much as 2.5 million barrels a day in the Permian Basin.
“It’s just another thing in the year of COVID,” Wilkes said. “We are still amidst it.”
What happened: Wilkes’s company, Texland Petroleum, which has about 1,200 wells in the Permian Basin, shut down all its production in May of last year at the height of the pandemic after multiple customers for his crude canceled or curtailed purchases.
Texland Petroleum, which has been in business since 1973, survived the downturn without firing anybody, and was back to full production before the cold freeze hit this week.
Wilkes said the company’s operations began to have power interruptions on Monday morning.
In oil producing fields, once water stops moving in the system, the wells begin to freeze up.
Some of the wells that the company could produce from had to be shut in because the oil haulers stopped picking up crude due to the icy road conditions.
All told, Texland Petroleum is producing at 33% of its normal levels.
What’s next: Wilkes said the company hopes to get power back today, but it cannot restart production until temperatures rise above freezing. That should happen this afternoon, enabling his crew to thaw equipment.
“It will be a tedious process for our field employees to make sure that all of the facilities and wells are operating correctly,” Wilkes said, adding it would be an additional week before the company is producing at normal levels.
Wilkes doesn’t blame anyone for the inability of the state and its decentralized grid to handle the storm, but he said he empathized with companies in the utility sector that don’t have financial incentives to weatherize their equipment.
“You can spend a lot of money trying to insulate everything, but severe events in the winter don’t happen that often,” Wilkes said. “Everyone is frustrated.”
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Josh Siegel (@SiegelScribe) and Abby Smith (@AbbySmithDC). Email [email protected] or [email protected] for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.
WHAT TRIPPED GAS AND COAL OFFLINE IN TEXAS: Nor are natural gas and coal plants, more than half of the power offline during Texas’s energy crisis this week, equipped to operate in a deep freeze, Abby reports in a story this morning.
“One of the practices in the past was in places like Texas, you would never have designed a power plant that runs at a temperature of 5 degrees, or zero degrees, or things like that,” Le Xie, an electrical and computer engineering professor at Texas A&M University and affiliate with its energy institute, told Abby.
Natural gas and coal plants can operate in frigid temperatures. Industry groups often point to coal and natural gas as pillars of grid resilience during winter storms in the Northeast and other colder regions because they provide dispatchable baseload power.
Most of Texas’ plants, however, aren’t weatherized for the cold, so in this week’s extremely low temperatures, all ranges of equipment froze, putting a squeeze on natural gas supply and forcing gas and coal-fired power plants to shut off.
Requirements to winterize: Texas Gov. Greg Abbott said in a press conference yesterday he has asked state lawmakers to mandate winterization of power plants and the grid. He is also calling on the legislature to provide the funding to do so.
Energy experts say a uniform requirement is needed to ensure Texas plants winterize because otherwise those facilities don’t have a commercial incentive to spend on potentially costly upgrades to prepare for rare events like this week’s freeze.
To underscore that point, federal regulators recommended a decade ago that Texas plants weatherize after another cold-weather event in 2011 led to some rotating power outages, albeit less severe than this week’s crisis. Few plants did, however.
NUCLEAR REACTOR BACK TO FULL POWER: A nuclear reactor outside Houston that shut down this week contributing to Texas’ electricity shortage has returned to full power of 1,350 megawatts.
Jim Connolly, the chief nuclear officer for the company that operates the South Texas Nuclear Power Station, vowed to conduct a full review of the cause and “apply appropriate preventive and corrective actions to continuously improve the reliability of our units.”
Preliminary analysis shows the shutdown of the nuclear reactor was caused by a disruption in a feedwater pump, and that caused the plant to trip automatically and shut down early Monday.
The shutdown of the reactor, one of the state’s four, has played a relatively small role in Texas’ power crisis, compared to outages from fossil fuels.
TEXAS GRID OPERATOR IS ENDING EMERGENCY CONDITIONS: “There is enough generation on the electric system to allow us to begin to return to more normal operating conditions,” said Dan Woodfin, ERCOT’s senior director of system operations.
The number of Texans without power has decreased from the millions to just under 200,000, according to online tracker poweroutage.us. ERCOT said those without power still are likely in areas where power lines were damaged by the winter storm or where power needs to be manually turned back on.
Even so, ERCOT says as of early this morning, around 34,000 megawatts of generation remain offline, with 20,000 MW of that gas, coal, and nuclear and the rest wind and solar..
MANCHIN PLANS HEARING: Sen. Joe Manchin, the Democratic chairman of the Energy and Natural Resources committee, intends to hold a hearing to examine grid reliability and resilience in the aftermath of Texas’ power failures, per spokeswoman Sam Runyon.
IT’S OFFICIAL…THE US IS BACK IN PARIS: And marking the occasion is a new climate coalition, dubbed America is All In, of cities, states, companies, investor groups, and others pushing for the U.S. to cut its emissions in half by 2030.
Joe Biden’s top climate officials, national climate adviser Gina McCarthy and special climate envoy John Kerry, both credited state and city actions to cut emissions during the Trump administration as critical to keeping the U.S. engaged on the international climate stage even as the federal government fell short.
When states, cities, and other groups started the “We Are Still In” coalition after former President Donald Trump pulled out of Paris, just one state and 33 cities had pledged to reach 100% clean energy. Now 13 states and 165 cities have adopted that target, Kerry said during remarks this morning at the new coalition’s launch event.
Kerry said he’d attended this morning’s G7 meeting with Biden, where all of the global leaders talked about climate change and the upcoming United Nations climate conference in Glasgow later this year.
“We’re going to move forward to do everything we can to establish the system that we need to actually get a strong nationally determined contribution that we can be proud of,” McCarthy said, referencing the new domestic climate target she’s developing as part of the U.S. renewed commitment to the Paris deal.
WHERE’S WALDEN? Former Republican Rep. Greg Walden, who retired in January, has joined the advisory board of the conservative clean energy group ClearPath, Josh reported this morning.
Walden was the top Republican of the House Energy and Commerce Committee, where he encouraged his party to work toward addressing climate change and curbing emissions.
By joining ClearPath, Walden, 64, is signaling he intends to focus his post-Congress work on promoting an agenda to confront climate change focused on spurring innovation of clean energy technologies.
BIDEN SCRAPS TRUMP GUIDANCE LIMITING CLIMATE CONSIDERATIONS: The White House Council on Environmental Quality formally withdrew Trump administration draft guidance limiting the scope of climate change effects and greenhouse gas emissions federal agencies must consider when conducting environmental reviews under the National Environmental Policy Act.
Withdrawing the guidance is the Biden team’s first step toward undoing changes the Trump administration made to speed up environmental reviews under NEPA. Those changes were met with industry praise, but environmentalists said the revisions weakened the decades-old environmental law by sharply weakening considerations of climate change and hampering the public input process.
Biden has already signaled he wants the CEQ to scrap all of the Trump administration’s changes to NEPA reviews. As part of his sweeping climate executive order, Biden also directed the CEQ chair and the White House budget director to require federal permitting decisions to “consider the effects of greenhouse gas emissions and climate change.”
ELECTRIC VEHICLE GROUP STAFFS UP: Kelly Fleming is joining the Zero Emission Transportation Association as its policy director, the coalition of utilities, electric vehicle companies, and mining firms announced yesterday.
Fleming previously led policy analysis for transportation and energy at the UC Davis Policy Institute for Energy, Environment, and the Economy. ZETA is pushing for 100% electric car sales by 2030.
The Rundown
Politico Wall Street leaders resist divestment push in climate fight
New York Times Cracked pipes, frozen wells, offline treatment plants: A Texan water crisis
Washington Post Texas, the go-it-alone state, is rattled by the failure to keep the lights on
Calendar
TUESDAY | FEB. 23
9:30 a.m. SD-366 Dirksen. The Senate Energy and Natural Resources Committee will hold a confirmation hearing for Deb Haaland to be Interior secretary.
WEDNESDAY | FEB. 24
10 a.m. G-50 Dirksen. The Senate Environment and Public Works Committee will hold a hearing titled, “Building Back Better: Investing in Transportation while Addressing Climate Change, Improving Equity, and Fostering Economic Growth and Innovation.”
