American Oil and Gas Reporter - June 2018 - 120

Therefore, he predicted, U.S. refineries
were likely to start installing more topping
units. "Basically, they take the light,
sweet crudes, pull off the naphtha and
diesel, and do not worry about refining
what's left on bottom," Colaw detailed.
"That is sold to another refinery."
He also considered how air quality requirements had changed, and noted that
when he started work at the refinery, U.S.
Environmental Protection Agency regulations allowed sulfur dioxide concentrations
of 5,000 parts per million for off-road
diesel fuel and 500 ppm for everyday
diesel truck fuel and gasoline. EPA then
dropped the limits to 10 ppm in gasoline
and 15 ppm in diesel. "Refineries had to
retool and build new processes to reach
the new requirements," Colaw noted.
CHS invested $480 million and four
years installing a new cracker to reduce
sulfur in its diesel. With other refineries
making the same modifications, diesel
lost its erstwhile price advantage over
gasoline, he reported. "Lowering sulfur
increased the cost of producing diesel
fuel," he observed.
Although the new rules reduced acid
rain, a farmer in the audience noted, they
also forced him to buy sulfur to fertilize
his fields. "That is an unintended consequence," Colaw acknowledged. "We
cleaned the air, but lost some of that
former balance."
Colaw also noted that CHS had installed a new wastewater treatment plant
and had reached an agreement with the
city to use its effluent to lessen its consumption of more useful water. "It reduces
the amount of water we get from our

CHS Reﬁnery Chief Chemist Darrel Colaw
uses a model hydrocarbon molecule to
illustrate a point during his "Reﬁnery
101" presentation. Colaw offered his remarks during KIOGA's midyear meeting,
held April 18-20 in McPherson, which
also offered an opportunity for KIOGA
members to tour the facility.

wells," he related. "We take the city
wastewater effluent, treat it through reverse
osmosis and microfiltration, and use that
for our boiler feed water."
Beta KOLAR
KCC's Hoffman opened his remarks
by reminding producers the KOLAR system was not yet fully operational. "This
is a beta version," he told KIOGA. "We
will send e-mails the first time KOLAR
is live, with a big bright headline asking
you to please try to break our system. It
will be a lot better (if that happens) before
it goes full live than after."
As he demonstrated the system, Hoffman drew attention to a format called tab
management. "We want you to log on to
KOLAR, see your deadlines, and be able
to click on a form and file it," he said.
He showed the audience an example
of a theoretical company well inventory,
and highlighted several options. "There
is the basic information, such as your license number, and then you have the
choice of whether to look at all your

wells at once, only the wells that are out
of compliance or all the wells with future
requirements," he outlined.
Hoffman mentioned a number of benefits the system offered. "Other than the
ability to have all the forms at your fingertips, one of its greatest future assets
will be as a planning tool," he predicted.
"Think of how you would like to search
the data. For instance, if you want to
know how many licenses you need for
an entire year, this will help you plan it."
However, he assured, the KCC was
not yet moving to discontinue paper notices. "We need to do a lot of research
before we can stop that, because we are
supposed to send notices to official representatives," Hoffman concluded. "There
are things we have to consider, and
perhaps we have to redraft some language
simply for you to submit a form."
Even so, he conceded, "Eventually
(an all-electronic format) would be ideal
because not having to send paper would
mean saving costs for us. But we have to
make sure you actually are notified." r

Industry Sees First Job Growth
Since 2014, TIPRO Report Says

Kansas Corporation Commission Conservation Division Director Ryan Hoffman
says the commission's Kansas On-Line
Automated Reporting system offers producers easy access to all KCC forms
and will serve as a good planning tool.
Hoffman told KIOGA in mid-April that
the system was still in its beta phase
and encouraged producers to test it.

AUSTIN, TX.-The U.S. oil and natural
gas industry employed 832,777 professionals in 2017, an increase of 3,060
over the previous year, and the first year
of net positive job growth since 2014,
the Texas Independent Producers & Royalty Owners Association applauds in the
third edition of its "State of Energy Report."
TIPRO says the industry paid a national
annual wage averaging $109,498 in 2017,
103 percent more than the average private
sector wage, and higher than average
wages for construction, manufacturing,
wholesale trade, information, professional

120 THE AMERICAN OIL & GAS REPORTER

services, health care, financial services
or education services, according to the
report. Payroll in the domestic oil and
gas industry totaled $91 billion in 2017,
down 3 percent compared with 2016.
The upstream sector includes three
distinct industry segments within TIPRO's
full definition of what comprises the
Texas oil and natural gas industry: oil
and gas extraction, support activities for
oil and gas operations, and drilling wells.
According to the association, survey data
from the Bureau of Labor Statistics reveals
the positive employment trend in Texas
continued through the first quarter of
American Oil and Gas Reporter - June 2018

Table of Contents for the Digital Edition of American Oil and Gas Reporter - June 2018
