LUBBOCK, Texas — Despite the struggles 2020 has brought to the energy industry, there are some bright spots ahead in 2021, according to officials from Norton Energy Drilling and Xcel Energy. Here were some of their predictions for the new year.
“The country always needs energy,” said Wes Reeves, a representative for Xcel Energy. “Whether that’s oil and gas, or the growing renewable energy industries that we have here, we know that energy is going to be needed.”
It’s projected that both renewable energy and oil will see significant growth by the second half of 2021. Oil prices and energy production are already up from when the pandemic first hit in March.
“We’re not nearly as in as bad of shape as we expected we might be at the beginning of the pandemic,” said Reeves.
However, job recovery has not happened quite as fast. Many companies have scaled back to get through the year, and many are still catching up.
President of Norton Energy Drilling, LLC, Jay Norton, explained how his business is still catching up.
“It has slowly picked back up,” said Norton. “The activity level pretty much goes with the price of crude oil.”
According to statistics from West Texas Intermediate Crude Oil, the cost of crude oil currently fluctuates between $40 and $50 a barrel – up significantly from April’s dismal drop into the negatives–the lowest drop in decades.
Norton Drilling typically has all six of their oil rigs running, but now, they only have two.
“I think when you get second half of 21, I think you’ll see a significant increase in the price and commensurate with that you’ll probably see an increase in the activity level,” said Norton.
That means more job availability and stronger local and state economies, especially with renewable energy and natural gas growing too.
Xcel Energy said it hopes to bring more wind and solar projects to the South Plains and Permian Basin in the new year.
“We just see this as an economic driver for rural areas that really have suffered over the last half-century really,” said Reeves. “When you think about it, there’s been a lot of depopulation. A lot of things have changed, and we’re very excited to be bringing new industry into these areas.”