04292016Fri
Last updateFri, 29 Apr 2016 5pm

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Energy Sector Weighs on Construction Starts

At a seasonally adjusted annual rate of $660.5 billion, new construction starts in March receded 1% from February’s pace, according to Dodge Data & Analytics. Total construction starts had jumped 13% in February, led by a huge gain for the electric utility and gas plant category. The dollar amount of electric utility and gas plant starts fell considerably in March, accompanied by a pullback for public works.

During the first three months of 2016, total construction starts on an unadjusted basis were $141.7 billion, down 10% from the same period a year ago that included the start of several massive power plants and liquefied natural gas (LNG) export terminals. 


Chevron Investing Billions in The Permian Basin

At Chevron’s annual security analyst meeting last month, chairman and CEO John Watson said that his company plans on investing billions into oil & gas projects in the Permian Basin.

According to the Hobbs News-Sun, Watson predicted they could be pumping up to 350,000 barrels a day out of West Texas and Eastern New Mexico within the next four years. Chevron currently pulls about 125,000 barrels a day out of the ground in that region. 

Chemical Activity Accelerating in the U.S.

The Chemical Activity Barometer (CAB), an economic indicator from the American Chemistry Council, expanded 0.6% in April following a revised 0.1% increase in March and 0.2% decline in February. All data is measured on a three-month moving average. Accounting for adjustments, the CAB remains up 1.8% over this time last year, a marked deceleration of activity from one year ago when the barometer logged a 2.7% year-over-year gain from 2014. On an unadjusted basis the CAB jumped 1.4%, following a solid 0.8% gain in March.

In April, production-related indicators were positive, with improvement in plastic resins used in packaging and trends in construction-related resins, pigments and related performance chemistry suggesting a housing recovery. Equity prices rebounded significantly in April, joined by a firming in product prices. Inventories and other downstream indicators were positive. 

Total U.S. Energy Production Up for Sixth Consecutive Year

Total U.S. energy production increased for the sixth consecutive year. According to data in EIA's most recent Monthly Energy Review, energy production reached a record 89 quadrillion British thermal units (Btu), equivalent to 91% of total U.S. energy consumption. Liquid fuels production drove the increase, with an 8% increase for crude oil and a 9% increase for natural gas plant liquids. Natural gas production also increased 5%. These gains more than offset a 10% decline in coal production.

The U.S. saw little change in production from nuclear electric power and renewable energy (across all sectors) in 2015. However, the U.S. saw shifts in the sources of electricity generation from renewable fuels, as declines in hydroelectric generation were mostly offset by increases in electricity generation from wind and solar. 

Plans for New Pipelines in the Northeast Scrapped

Citing environmental concerns, the New York State Department of Environmental Conservation announced the denial of a water quality permit for the proposed Constitution Pipeline. The Constitution proposal involved construction of approximately 124 miles of new interstate natural gas piping in northeastern Pennsylvania, proceeding into New York State.

“The decision comes two days after Kinder Morgan Inc. announced it was mothballing its planned Northeast Energy Direct pipeline, which would have followed some of the same route as Constitution. Kinder Morgan, which was earlier in the FERC process, cited economic reasons for its decision,” The Associated Press reports

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