Premature Alaska Pipeline/LNG Funding


To Russ Girling, the chief executive of TransCanada, the relationship between pipelines and climate change is clear….  (CBC by Tracy Johnson.)

TODAY'S Call To Action: OCS!

Today's Consumer Energy Alliance Relevant Energy Links!

Juneau Empire Op-Ed, By STEVE BOWHAY

Alaskans face some serious challenges that are being overlooked, as we witness the demise of the oil industry. Some of the people who are part of the consensus on climate change want to completely ban the use of fossil fuels because of climate change.

If the price of oil is disappointing to Alaskans who are counting on their pension, the thought of no oil revenue or even legal action that goes after our Permanent Fund to pay for climate change impacts should make your knees wobble. We all know ignoring a problem never ends well.

The problem is while we support the Alaska LNG project, we worry that if we do nothing, by the time the gas is ready for market it will be illegal to sell it.

While others are receiving subsidies for “green fuels” (which is bio-diesel or actual gasoline rendered directly from wood chips or non-food portions of crops) we are paying fees and taxes for carbon emissions.

Leaders in the bio-fuel industry (Cool Planet Energy Systems) claim they can get 3 thousand gallons of gasoline per acre from corn stalks.

The Black Spruce forests of interior Alaska store several times more hydrocarbons (fuel) per acre than corn stalks. Last year wildfires burned 5 million acres in Alaska; that would equal….  (More)

ADN by Nathaniel Herz.  The Alaska House Finance Committee on Monday rejected Gov. Bill Walker’s $40 million budget request for the state’s proposed natural gas pipeline, reflecting what lawmakers said was their uncertainty about the $55 billion project’s next steps.

Mark Neuman, Alaska House Finance Committee Chairman, Ak LNG Project, gas marketing, Photo by Dave HarbourWe agree with Chairman Neuman's  analysis.  It's not only the amount of money involved, but also timing and…also…whether the functions to be funded are the proper functions of government in the first place.  -dh

Committee leaders expect next week to put enough money back into the budget to pay for completion of a key pipeline planning stage. But some of the work initially proposed by the Walker administration was premature, like a marketing unit that would start trying to sell the state’s gas, said one of the committee’s co-chairmen, Rep. Mark Neuman, (NGP Photo).“Let’s make sure we have a gas pipeline before we spend money,” Neuman said in an interview. “Why do we have to be concerned about marketing at this point? We’re not there yet.”

OCS Call to action!

NGP Readers:

We just wrote DOI in support of expanding American oil and natural gas OCS development.

Currently, our government allows energy exploration in only 13 percent of offshore areas, meaning 87 percent is off limits.

Responsibly developing some of these abundant resources will be good for local communities, the economy, and national energy security — as our astute readers know.  

Please visit to easily weigh in on this most important OCS issue:

Dave Harbour, Publisher

P.S.  Circa. 2008-9 Your publisher led a national study on the impact of NOT developing America's energy resources.  (Also see our NGP report, O&G Journal, Ak. Business Monthly)  Much of that study is still valid today and to future scholars as well.  Here is a link.


Today's Consumer Energy Alliance Relevant Energy Links!

David Holt, HWB, CEA, OCS, NARUC, Photo by Dave HarbourDownstream Today: Might Consumers Ultimately Pay the Price for Cheap Fuel? David Holt Quoted  (NGP Photo)
As this graph from the American Automobile Association (AAA) shows, the U.S. average price for a gallon of gasoline has fallen dramatically since the second half of 2014. As of February 8 of this year consumers were paying an average of $1.74 per gallon of gasoline, representing a 44-cent year-on-year decline, according to AAA. Barring any significant supply disruptions, AAA expects the low-price trend to continue for the near term.
 Andrew Browning, David Holt, CEA, HWB, OCS, Photo by Dave Harbour
Grand Junction Daily Sentinel: Coloradans sound off on BLM methane rule Andrew Browning Quoted (NGP Photo)
The Bureau of Land Management heard widespread support Tuesday for its proposal to reduce methane emissions involved with oil and gas production. The BLM held a public meeting on the proposal Tuesday in Lakewood. Many who back the rule want it toughened even further than proposed, with fewer exemptions, while some industry proponents say it’s not needed and will further depress drilling activity that’s already weighed down by current low oil and gas prices.
Fuel Fix: Top U.S. official says adjustments made on offshore drilling rule, following “alarmist” industry response
A new federal rule designed to reduce the chance of another offshore drilling accident off the Gulf Coast like Deepwater Horizon has undergone some “adjustments” in response to intense industry criticism, a top U.S. energy official told a House subcommitteeWednesday.
Bloomberg: Oil trades above $34
Oil traded above $34 a barrel in New York amid projections that a government report will show U.S. crude supplies climbed while equities rose on signs manufacturing in the world’s largest economy is stabilizing. Futures fluctuated in New York. U.S. crude stockpiles probably increased 3.3 million barrels from an 86-year high last week, according to a Bloomberg survey before an Energy Information Administration reportWednesday
Bloomberg: Squint and you can see light at the end of oil’s dark tunnel
Have we reached the beginning of the end for the biggest oil crash in a generation? Maybe, says one prominent energy research firm. The global crude glut that’s been weighing down prices for 20 months actually shrank by 12 million barrels in January, according to London-based Energy Aspects Ltd. Pipeline outages took output offline in Nigeria and Iraq, while U.S. oil production fell on a year-by-year basis for the first time since 2011 in December.
Rigzone: IEA: Oil Prices Have Bottomed Out, But Growth Will Not Be Sharp 
Crude oil prices have hit their lowest point and should begin a slow increase in 2016 as an international supply glut eases, according to an International Energy Agency senior analyst. Neil Atkinson, head of IEA's oil industry markets division, said price increases could be stalled if US shale oil production picks back up.
McClatchy DC: Low oil prices don't matter: Gulf of Mexico output to hit record in 2017
Oil production in the Gulf of Mexico is expected to increase next year even as new offshore development and exploration have slowed to a crawl, weighed down by a drastic drop in oil prices. The increased production won’t be driven by new projects or the president’s latest plans to open an additional 45 million acres in the Gulf of Mexico to oil and gas exploration. Instead, 14 Gulf of Mexico drilling projects in various stages of development and expansion will fuel the increased output for this year and next.
Reuters: In slump, oil firms turn to labs, data centers for help
In a basement lab of a North Dakota research center, Beth Kurz and an assistant are peering through a scanning electron microscope, studying samples from the state's vast Bakken shale oil formation. Kurz, a hydrogeologist, is part of a team, which looks at using carbon dioxide to coax more oil out of wells that have already been hydraulically fractured, or fracked, in the process of extracting oil from shale rocks.

Associated Press: Russia says global deal on oil output cap is close
Russia says it is close to an international deal with OPEC countries to cap oil production, and that a final decision will be made at a meeting this month. Saudi Arabia, Russia, Venezuela and Qatar floated an output cap last month with the aim of boosting oil prices, but it was conditional on other producers joining in. Iran has so far resisted, while Russia has agreed.
Oil & Gas Journal: EIA: US crude production rose by 722,000 barrels per day in 2015
US crude oil production rose less steeply in 2015 than in 2014, but still increased to an average of 9.43 million barrels per day, the Energy Information Administration reported. The rise from 2014's average of 8.71 million barrels per day was only a 722,000-barrels-per-day year-over-year increase, compared with the 1.25-million-barrels-per-day rise seen from 2013 to 2014.

SNL Financial: Interstate pipelines do not reduce property values, INGAA Foundation finds
Underground natural gas pipelines do not hurt the price or value of residential properties, the INGAA Foundation found in a study that answered a common charge leveled by opponents of pipeline projects. "This report backs the findings of the INGAA Foundation's previous 2001 study of property values along pipeline routes — that underground natural gas transmission pipelines do not affect home values," INGAA Foundation President and CEO Donald Santa said. "These findings might help property owners feel more confident about natural gas pipelines proposed in their communities.
E&E News: Enviro challenge to crude-by-rail rule dismissed
A nearly yearlong legal battle over the Obama administration's new rules for crude-by-rail safety ended yesterday as a federal court dismissed a lawsuit from environmental groups. The Sierra Club, the Center for Biological Diversity, ForestEthics and other groups on Monday told the court their core arguments against the Department of Transportation's rule were resolved when Congress passed the Fixing America's Surface Transportation (FAST) Act late last year.
Washington PostSolar energy is poised for an unforgettable year
New statistics just released by the U.S. Energy Information Administration suggest that in the coming year, the booming solar sector will add more new electricity-generating capacity than any other — including natural gas and wind.
Fairfield Sun Times: Development of North Slope Alaska oil discovery moving forward
When Bill Armstrong’s company took over operatorship of the 750,000 acres it owns jointly with Repsol on the North Slope, many Alaskans saw it as another casualty of low oil prices. The October announcement cancelled three of this winter’s wells in the fifth and last year of the partners’ aggressive $1 billion-plus exploration program, triggering fear the Spanish major, which had promised to make a field development decision in January, was pulling out of the state, and thus delaying development by years.
UPI: Texas shows decrease in oil production
Texas crude oil production showed a decrease in December as crude oil prices dragged on state potential, though banks are seeing signs of life. The Railroad Commission of Texas reported crude oil production for December, the last full month for which data are available, at 74.6 million barrels of oil, a decline of about 3 percent from November.
E&E News: Tumultuous campaign for Texas energy regulator heads to runoff
Two Republicans will meet each other in a May 24 runoff election for a seat as one of Texas's top oil and gas regulators, after a primary campaign that hinged on conservative principles.
Athens Messenger: Environmental group appeals decision related to injection well
Athens County Fracking Action Network is appealing a court decision that rejected ACFAN’s effort to have the Ohio Oil & Gas Commission hear its objections to a permit issued for an injection well.
West Virginia MetroNewsCoal severance tax advances, natural gas added
The state Senate has advanced to passage stage a bill lowering the severance tax on the struggling coal industry. The Senate approved an amendment Tuesday that includes the natural gas industry in the reduction.
Wheeling News-Register: Forced Pooling Bill Delayed Again in West Virginia Legislature
For the fifth time in six years, a bill to allow forced pooling of Marcellus Shale natural gas rights has stalled in the West Virginia Legislature. Wednesday is "crossover day" – the day on which a bill must advance from its house of origin to be considered in the opposite chamber. Delegate Pat McGeehan, R-Hancock, a staunch opponent of forced pooling, said this is not going to happen.
The Patriot-News: Oil and gas fight hits Pa. suburbs
It's been more than a decade since the first Marcellus Shale gas well was drilled in Pennsylvania, but some fights over oil and gas development are just beginning. In the southwestern corner of the state, there's an ongoing battle between a drilling company and residents of Penn Township, a suburb about 20 miles east of Pittsburgh.
Atlanta Journal-Constitution: Judge denies east Georgia Palmetto pipeline
Pipeline giant Kinder Morgan’s plans to lay 210 miles of petroleum pipes across East Georgia were thwarted Tuesday when a Fulton County judge ruled the Texas company can’t use eminent domain to take property from unwilling landowners.

Associated Press: Florida HF bill dies in Senate committee
A Florida Senate bill that would require the state’s Department of Environmental Protection to study and create regulations for fracking is essentially dead. The Senate Appropriations Committee on Tuesday refused to reconsider the bill after narrowly voting against it last week.
Florida Today: Brevard County commission says no to HF
Brevard County commissioners today said no to fracking. They unanimously passed a resolution opposing a Florida Senate bill that opponents of fracking fear would clear the way for the process in Florida.