Newspaper article THE JOURNAL RECORD

U.S. Oil Production Expected to Decline in 1990

Newspaper article THE JOURNAL RECORD

U.S. Oil Production Expected to Decline in 1990

Article excerpt

Year-end is approaching. Thus, the energy industry has turned its attention to the coming year. What will the new year bring?

Domestic crude oil production will decline by 4.3 percent to 7.4 million barrels per day while natural gas production will remain flat at about 16.6 trillion cubic feet in 1990, predicts the Independent Petroleum Association of America.

At the same time, the group's Supply and Demand Committee forecasts U.S. demand for petroleum production to rise a minimal 0.7 percent to an annual average of 17.5 million barrels per day in 1990.

"Total imports will then average 8.1 million barrels per day next year, or 46 percent of domestic supply. . .which continues a dangerous trend of rising imports and decreased domestic production," said Danny Conklin, chairman of the association.

The association held its annual meeting last week in San Antonio.

The Supply and Demand Committee also foresees 1989 crude oil production to drop 5.6 percent from 1987, with demand rising a small 0.3 percent.

For several months this summer, petroleum product imports ran higher than 50 percent, causing national furor over energy security.

Independent analysts have said that incentives must be implemented to boost domestic drilling because the industry still has its head turned toward foreign prospects. Much of the cause for decline in domestic drilling, they say, is due to volatile oil prices and the growing concern about environmental aspects of drilling.

Energy analysts also predict oilfield companies will come closer, or reach, the breakeven point in financial results next year, with profits resurfacing in 1991.

But, the association is not going any farther than "cautious optimism."

The association is celebrating its 60th year with nearly 10,000 members in all 33 oil and gas producing states. . .

- A word of encouragement was received last week by the National Institute for Petroleum and Energy Research in Bartlesville.

U.S. Rep. Mickey Edwards, R-Oklahoma City, said Friday he has received a "strong and ongoing commitment" from the U.S. Department of Energy to continue funding the Oklahoma research program.

Research management in Bartlesville had previously met with Michael McElwrath, acting assistant secretary for fossil energy at the energy department. McElwrath notified the Oklahoma researchers that close scrutiny would be imposed on the program in the future as related to the 1990 fiscal year research plan.

Subsequently, Edwards and Bartlesville Area Chamber of Commerce President Larry Dennis met with Energy Secretary James Watkins, with apparent support.

"While the focus of our petroleum research program is evolving from long-term, high-risk research to nearer-term applied research, this should have no adverse effect on the size of the program or the employment levels at Bartlesville," Watkins said.

"We view our petroleum research program as a critical component in any national energy strategy. We also recognize the importance of our commitment to the local Bartlesville community."

Edwards said he plans to meet with the Oklahoma research team and management to discuss the government's continued support. . .

- Initiative can mean taking the first step, finding new ways to do something or proposing legislation.

As part of the title of the Governor's Energy Conference next week, all definitions of the word will be explored as applied to the natural gas market.

Of particular interest, Oklahoma's first energy plan will be unveiled at the conference, which will be Nov. 15 at the Myriad Convention Center.

"This is a timely and important topic not only to those in the natural gas industry, but to Oklahoma as well," said Richard Hess, executive director of Oklahomans For Energy and Jobs, who is coordinating the event. …

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