Personal to readers: We confess to have been almost totally absorbed with our accountant in preparing over the last week for today's electronic filing to the IRS. We, therefore, are grateful to patient readers for your understanding and patience. -dh
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Alaska Dispatch by Pat Forgey. "Enstar's proposed (Gas Supply Agreement) immediately raised concerns because it would have increased natural gas costs to the company's captive ratepayers – a topic of special concern for the Murkowski administration," then-Attorney General David Márquez said following the decision. * * * The rejection of that contract may have been the beginning of the end for Marathon in Alaska. Over the next several years the company sold its interest in the Nikiski LNG export plant to co-owner ConocoPhillips, and sold its gas production operations to Hilcorp Energy Co. South Central Alaska's Unjust and Unreasonable Gas Prices Opinion by Dave Harbour We appreciate the legislative efforts of Representative Mike Hawker, House Speaker Mike Chenault and their colleagues, and the dedication of the current commissioners to secure adequate gas supplies for Alaska's major population centers. In late 2006 and early 2007 a three member majority of the five commissioners voted not to approve a gas contract with Marathon that would have provided secure energy supplies through 2016. As the member of the commission with greatest oil and gas experience at the time, I carefully studied our record and argued fervently in favor of approving the gas supply agreement. At one point in the proceeding one or two commissioners seemed determined to force Marathon into divulging proprietary costs of producing gas as if it were a public utility. In the final weeks of 2006, the Commission could have stuck with its precedent, respected the arms length agreement between Enstar and Marathon and secured reasonably priced energy for consumers through 2016. When the Majority, instead, decided to flout precedent and — in my opinion — make a decision NOT based on the record, I dissented twice (Here is the first dissent and here is the second.) In retrospect, observers believe those dissents summarized why the contract should have been approved. As a rough estimate, I believe that the Majority of three commissioners at that time, ended up costing Alaska consumers well over a half-billion dollars more than they would have paid under terms of the gas supply agreement Enstar and Marathon so responsibly advocated. The decision also dampened the ardor of potential and current Cook Inlet oil and gas producers. To this day, I am grieved that I could not have summoned more persuasive arguments to prevent consumers over the years from paying 'unjust and unreasonable' rates resulting from a disastrous regulatory decision. Do I harbor ill will for the three who made that decision? No. They were well intended. But as we see so often in this very real world: the road to hell is indeed paved with good intentions. Additional references: 12-9-08 Harbour Speech to International Law Institute. See Harbour Commentary, 1-30-09. 2-23-09 Harbour Speech to Alaska Association of Energy Economists. 7-30-09, Harbour Commentary: Regulatory Commission Should Know When To Hold 'em, Know When to Fold 'em, Know When to Walk Away and Know When to Run. 10-15-13: Current Petroleum News article by Alan Bailey. |
We are delighted to provide TODAY'S Energy-In-Depth links:
Without shale, oil prices would be a lot higher. The Hill, Column. These would all seem to be good reasons for welcoming, with safeguards, the continued growth of oil and gas extraction from U.S. shale production. Its place as price stabilizer, in the midst of supply uncertainty and political volatility, deserves more recognition. Bringing new production to the markets, and thereby holding down oil prices, has critical importance both to America’s own recovery and to global economic prospects.
Weighing the Benefits and Trade-Offs of Natural Gas. Breakthrough Institute, Q&A. Shellenberger: I think the other thing is that gas is actually good for renewables. Most people aren't totally aware – they might be aware – solar and wind, obviously, are not always on. They're not considered baseload sources of power. So they need to have either a backup in the form of batteries which are very expensive, really not – we don't have utility scale batteries, really – or pump storage, such as using hydroelectric dams. And the very cheap gas that we've got over the last several years has not had a negative impact at all on renewables.
Balancing act needed to win with hydraulic fracturing. Houston Chronicle/Fuel Fix. The operator of the well can offer up drilling logs and core samples of rock formations taken during drilling. The operator’s engineers and geologists weigh in, but Musgrove says that in large part well owners rely on expertise of service companies, in this case Halliburton, to design the frac.
Analysts see production rebound in the works. E&E News (sub. req’d). Natural gas production could return to an upward trajectory next year as pricing improves and new pipeline projects come online, some analysts are predicting.
Activists urge EPA to keep pushing on CBM rule. E&E News (sub. req’d). U.S. EPA has proposed ditching the wastewater rules it's been developing since at least 2007 for coalbed methane production, saying gas prices are too low for drillers to implement them.
INTERNATIONAL
Canada's Energy Exports to Asia to Be Competitive. Wall Street Journal. Recent technological breakthroughs have led to surging North American output of both oil and gas, with much of the increase attributable to hydraulic fracturing, the process by which previously inaccessible hydrocarbons are released from shale rock formations. The glut has led to more than two dozen proposed new liquefied natural gas export facilities aimed at Asia in particular, pitting Canada and U.S. against each other and traditional gas suppliers, including No. 1 exporter Qatar, which enjoys particularly low production costs.
GDF Suez: Shale answer to Europe's woes. UPI. Opening up to shale oil and natural gas in Europe could ensure long-term energy security for the region, an executive at French energy company GDF Suez said.
UK has opportunity to follow US lead on shale energy, says Eversheds partner. The Lawyer. Jason Lovell, partner and oil and gas expert at Eversheds, has responded to a report that the US shale gas revolution will see it become the world’s largest oil producer.
Aramco eyes unconventional gas for power plant in Jazan. Saudi Gazette. Saudi Aramco will join the United States in becoming an unconventional gas producer, as it prepares to commit gas supply to a major power plant project in Jazan, northern Saudi Arabia.
Greenpeace Starts Legal Challenge to Stop U.K. Shale. Bloomberg. Environmental group Greenpeace started a legal challenge to shale-gas exploration in the U.K., encouraging landowners to use trespass laws to block drilling.
Saudi to join US as shale producer. Gulf Times. Opec heavyweight Saudi Arabia is preparing to be among the first countries outside North America to use shale gas for power generation and thereby save more of its crude oil for lucrative exports.
Ministries look to fine firms for sluggish shale gas exploration. Warsaw Business Journal. The Ministry of Economy and Ministry of Environment want to implement new regulations imposing fines on companies deemed to be carrying out their shale gas extraction projects too slowly.
CALIFORNIA
Oil executives join Oxy board. E&E News (sub. req’d). A pair of oil executives were elected to the board of directors of California-based Occidental Petroleum Corp. The panel's newest members are Valero Energy Corp. Chairman and CEO William Klesse and ConocoPhillips Co. Chief Administrative Officer Gene Batchelder.
ILLINOIS
Activists to present program in Vienna. The Southern. A group opposed to the idea of hydraulic fracturing in Southern Illinois is hosting a public program tonight at the Vienna Public Library. The event, sponsored by SAFE (Southern Illinois Against Fracturing our Environment) goes from 7 p.m. to 8 p.m. at the library, located at 401 Poplar Street in Vienna.
NORTH DAKOTA
Investing in Montana's Bakken. Energy & Capital. Montana, and eastern Montana in particular, has been seeing a lot of changes in the past 18 months due to the oil and gas boom from the region’s Bakken shale. The question now is: will Montana see the same prosperity that we see in North Dakota?
N.D. pipeline spill prompts calls for better oversight. E&E News (sub. req’d). North Dakota needs to do more to ensure that pipelines can safely carry the rapidly expanding oil production from the Bakken Shale, state officials, transportation experts and environmentalists said after a pipeline leaked 20,600 barrels in a wheat field last week.
NORTHEAST
Drilling water wells a tactic to block HF. StateImpact PA. The Pittsburgh Post-Gazette reports the “water well gambit,” drilling private water wells on sites slated for natural gas drilling, has been used for years, often by people and companies that don’t own the mineral rights to their properties.
Industry squares off against Dems pushing for tax. Fox News.The Marcellus Shale Coalition, that industry group, on Thursday blasted plans from a variety of Democrats’ gubernatorial hopefuls who say they want to increase the taxes paid by the natural gas industry for tapping the state’s natural gas reserves. NOTE: Philadelphia Inquirer also reports.
Greg Kozera: Time for a reality check on energy. Daily Mail, Op-Ed. I don't understand groups that want to see our oil and gas industry shut down so that we can become fully dependent on Russia, as Europe, is for its natural gas.
Jobs are great, but environment is key asset. Press & Sun-Bulletin, Op-Ed. Earlier this month, a newly formed upstate business association announced it was promoting fracking because of the 60,000 jobs it would bring in.
Application filed for gas pipeline expansion. Citizens Voice. The company managing the Marcellus pipeline that runs through Luzerne County is poised to expand the line again. On Sept. 30, Williams, the Texas-based company that owns the Transco pipeline, filed an application with the Federal Energy Regulatory Commission to expand its Leidy Line, which delivers gas from central Pennsylvania to customers from New York City to Alabama.
Rig count declines in Marcellus, grows in Utica. Pittsburgh Business Times. Baker Hughes Inc.'s latest data shows there are 85 rigs operating in the Marcellus Shale, down one from last week and down from the 90 operating a year ago. The Utica Shale rigs are at 38, up two from last week and up 12 from a year ago.
Natural Resource Group LLC Establishes Roots in the Marcellus Region. PR Newswire, Press Release. Natural Resource Group LLC, a leading consulting firm to the energy industry, created a base of operation in the Marcellus Shale gas play with the opening of a new office in Downtown Pittsburgh.
OHIO
Activists to fight Ohio's wastewater rule. Akron Beacon Journal, Press Release. Frackfree Mahoning Valley (FFM) calls for an immediate halt to plans that Ohio state regulators are reportedly implementing by January 1 to use open pits or impoundments for toxic fracking waste.
A nearly complete train track at the Ohio Commerce Center is a key part of a $70 million fuel depot. Youngstown Vindicator. A nearly complete 12,000-foot loop train track at the Ohio Commerce Center in Lordstown is among the key components of what Halcon Resources Corp. says eventually may be a $70 million fuel depot.
Ohio must not rush to dive headfirst into ponds. Youngstown Vindicator, Editorial. As we’ve argued throughout the growth of fracking in our region, safety concerns must never take a backseat to economic self-interest. That’s why ODNR regulators should solicit input on the rules aggressively and take all the time needed to ensure impoundment ponds in the Buckeye State debut productively and safely.
Ohio Supreme Court to decide who regulates drilling – state or local communities. Columbus Business First. The Ohio Supreme Court has decided to hear an appeal of a case that could lead to local communities having the right to regulate oil and natural gas drilling within their boundaries, wresting that authority from the Ohio Department of Natural Resources.
Gas reps: Pipeline creating jobs. Salem News. With natural gas exploration already under way in Columbiana County, two men representing two companies involved in the area were among those who spoke at a community informational meeting Monday sponsored by the Columbiana Area Chamber of Commerce.
TEXAS
Oil and gas executives gather to dissect Permian’s potential. Midland Reporter-Telegram. Despite the hustle and bustle of a thriving oil and gas industry, executives and interested parties from oil and gas companies in the area and from around the state and nation will pause to examine the Permian Basin’s future.
Texas startup digitizes oil and gas monitoring. E&E News (sub. req’d). WellAware aims to allow real-time electronic monitoring of everything from pipelines to oil storage tanks in South Texas' booming Eagle Ford Shale, via software originally developed for utilities.
Atlas Pipeline increases processing of natural gas in the Eagle Ford. San Antonio Business Journal. Natural-gas processor Atlas Pipeline Partners’ Eagle Ford Shale properties handled a 20-percent volume increase during the third quarter over volumes for the previous quarter, officials said in a company operational update.
Texas generators stay on sidelines in push for more combined heat and power use. E&E News (sub. req’d). The struggles of the CHP industry in Texas mirror those seen nationally. More states are adopting laws and incentive programs that are seeing companies adding distributed generating capabilities that use CHP in their facilities. CHP by natural-gas-powered generation is explicitly targeted in some state efforts.
Eagle Ford By Well Cost. Seeking Alpha. EOG will be drilling profitably in the Eagle Ford for decades to come. If you want Eagle Ford exposure, EOG isn't the only name, but it should always be on your short list.
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