i imagine the major news of this past week was the results of the eight ballot issues nationally to outlaw or otherwise restrict fracking in several diverse locales....by far, the citywide ban that garnered the most coverage was the Denton Texas ban on fracking, considered symbolic as the town is thought to be the birthplace of the process...although it passed with a 59% margin, both the Texas Land Office and the Texas Oil and Gas Association filed suit against the results early the next day, arguing that the state laws and constitution prevent such local actions....in Ohio, the Athens Community Bill of Rights ,which modified their municipal code to prohibit gas and oil extraction, passed with 78% of the vote, while similar measures in Gates Mills and the City of Kent failed to pass, getting just 32% and 46% of their votes respectively...and the Youngstown attempt to pass a anti-fracking bill of rights was rejected for the 4th time, this time by a vote of 7,231 to 5,268 (58% against)...in anti-fracking issues in California, San Benito county passed their ban with 57% of the vote, a ban in Mendocino county won with 76%, while a similar measure in Santa Barbara County failed, getting just 37%...
you all probably know more about the mid-term results nationally than i do, but i have caught wind of stories on some of what might result from it...Mitch McConnell of Koaltucky, who presumably will be the new majority leader in the Senate, says his top priority will be to reign in the EPA and overturn their regulations limiting atmospheric carbon emissions, whereas the word from the House is that the first bill Boehner will attempt to pass will strip the State Department of responsibility for Keystone and approve its construction immediately...since a number of Democrats also support Keystone, it's thought that an override of a presidential veto, if it would even be forthcoming, is now possible...in the controversial "free trade" agreements currently being negotiated by the administration, where Obama's attempts to get fast track authority has been blocked by Senate Democrats, it's thought that the Republican majority would be more likely to allow these business friendly agreements that would mandate exports of our gas and oil to be completed and signed behind closed doors without a public hearing...if these trade agreements are completed to form, all the local fracking bans just passed will eventually be subject to adjudication by an international investor-state trade tribunal stuffed with appointees from the multinational corporations....another issue favored by the new majority is the privatization of public lands, either through turning them over to the states or through direct sale...so apparently what we've seen with Judge Grendell and the Geauga Park District is just the tip of the iceberg...
the most important international news effecting the US oil industry came early in the week when Saudi Arabia unilaterally raised prices of its light sweet crude oil for sale to Europe and Asia, while they lowered prices for the US...the Saudis didnt say why - they seldom do - leading to widespread speculation that they might be deliberately trying to undercut tar sands and shale oil producers in N.America...however, the Saudis may just be trying to hold their market share against other OPEC producers, or there may even be a geopolitical motive or deal in their move - Obama announced he'd be sending more troops to Iraq shortly thereafter, as ISIS Jihadists apparently have crossed the Saudi border with that country...whatever the case, lower prices are apparently already having an impact on US producers; the count of oil rigs operating in the US fell by another 14 this week to 1568, down from a high of 1609 four weeks ago...if lower oil prices persist, we can expect more drillers, especially those that are well capitalized, to fold up shop and wait it out..
before we start with Ohio related news, i'll call your attention to an anti-fracking animated video that ran on “The Simpsons" this week; note that those in favor of fracking are portrayed as evil or dumb, while the opponents are lucid and understand the implications of it...it may seem a bit silly to have these issues aired at the level of a cartoon, but when you look at the widespread ignorance obvious in the voting just two days later, it may be that this kind of media is the only way to get through to the majority...
Ohio Company Wants To Mine For Coal Under A State Park --A major Ohio coal company is trying to get permission to mine beneath an eastern Ohio state park.As the Columbus Dispatch reports, Ohio Valley Coal Co. has sent an application to the Ohio Department of Natural Resources to expand an existing mine into Barkcamp State Park. The expanded section would run 16 acres into the park, and include another 314 acres outside of the park. The company would be doing room-and-pillar mining, a process in which underground “rooms” are excavated for coal, while chunks of undisturbed land are left around the rooms as “pillars” in order to hold the land up.Robert Shields, chair of the Ohio chapter of the Sierra Club, told ThinkProgress that this method of mining is concerning to him. He said room and pillar mining leaves land vulnerable to subsiding, which could be dangerous for visitors in the state park. But he said he’d be concerned about any mining taking place in a state park — whether it was room-and-pillar or some other method. “We at the Sierra Club do not support any surface or subsurface mining or metal extraction in state parks. They are there for the enjoyment of people, and this does not contribute to that,” he said. “As a matter of fact, it detracts.” Shields is concerned for the park, but he’s more concerned about the fact that Ohio is still treating coal as a viable energy source.
Athens votes to ban fracking | The Columbus Dispatch: — Athens became Ohio’s fifth city to ban fracking Tuesday when voters approved a local ordinance to keep the controversial practice outside the city limits. Similar measures were voted down yesterday in Youngstown, Kent and Gates Mills, a village outside Cleveland. The Athens Community Bill of Rights passed with about 78 percent of voters casting ballots in favor. The measure modifies Athens municipal laws to prohibit shale gas and oil extraction and related activities. To pull oil and natural gas from shale, companies drill vertically and turn sideways into the rock. Then they blast millions of gallons of water, sand and chemicals into the shafts to free trapped oil and gas. The process is hydraulic fracturing, commonly called fracking. During the process, fluids bubble back up to the surface with the gas. Fracking chemicals include ethylene glycol, which can damage kidneys; formaldehyde, a known cancer risk; and naphthalene, considered a possible carcinogen. The waste that bubbles up also includes radioactive material. According to the state of Ohio, at least 2 billion gallons of wastewater are injected every day into wells throughout the country. Community Bills of Rights, designed by the national nonprofit Community Environmental Legal Defense Fund, have been proposed around the country to try and keep environmental threats, perceived or real, out of municipalities. In Ohio, such measures have passed in Oberlin, Yellow Springs, Broadview Heights and Mansfield.
Athens anti-fracking bill of rights gets thumbs up from voters - Athens city voters overwhelmingly supported a measure to establish a citizens’ bill of rights to restrict fracking and associated practices in the city limits. Issue 7 passed with 78 percent, or 2,245 votes, according to unofficial results Tuesday evening. The measure restricts fracking, drilling, and the transportation of fracking waste within the city and purports to protect water quality. The issue was placed on the ballot by the Athens Community Bill of Rights Committee. The group attempted to place a ban on fracking and associated practices on the city ballot last year. The group had collected enough signatures to get an initiative on the November 2013 ballot, but the initiative was challenged by a group of residents represented by attorney Rusty Rittenhouse of Lavelle and Associates. The elections board voted to uphold the challenge, preventing it from being placed on the 2013 ballot. The first initiative proposed a ban on fracking and associated practices in the city limits and the city’s “jurisdiction.” The initiative approved by voters on Tuesday pertains only to the Athens city limits. The initiative also included a bill of rights, which invalidates the state’s pre-emptive laws granting special privileges to for-profit corporations over the rights of people to a healthy, clean and safe environment, according to BORC. On Tuesday evening, BORC member Jeff Risner called the support from voters “overwhelming.” “We were hoping to get at least 60 percent because we wanted a really good turnout,” he said.
The Impact of Fracking in the United States - teleSUR - A boon for the U.S. domestic oil and gas production or an environmental menace to local populations? A natural gas explosion rocked eastern Ohio on Tuesday. In the town of Beallsville , located in Jefferson County , a well ruptured, sending methane gas into the air. Four hundred families had to be evacuated, according to The Columbus Dispatch, an Ohio newspaper, and a specialty company had to be brought in to shut down the well and prevent gas from leaking into the air. Ohio is one of several states in the union that has become a hot spot for hydraulic fracturing, or “fracking,” which is a natural gas and oil extraction method that involves horizontal drilling to shatter the deep shale layer to release natural gas. Along with eastern Ohio , fracking is most common in the states of Texas , Louisiana , Pennsylvania , North Dakota , and North York , all regions where there is a significant presence of shale bedrock layer. While there is no comprehensive national database tracking air or water contamination complaints due to fracking in the United States , the states of Pennsylvania , Ohio , Texas and West Virginia have filed complaints the most, with more than 100 cases in the last five years verified in Pennsylvania . Russia Today reported that in the last two years alone, the state has fielded nearly 900 complaints. Meanwhile, Ohio has certified six cases of contaminated water out of 190 complaints to that effect since 2010. Over the last four years, West Virginia has received 122 complaints, four of which were deemed severe enough to warrant “corrective action.” But despite the widespread outcry in many communities across the United States against the natural gas and oil extraction procedure, the U.S. oil industry sees fracking as a boon for its economy.
Corbett Out ! -- Tom Corbett, who single handily handed Pennsylvania over to the frackers is out as governor. Corbett tuned the state into a fracking 3rd World gas colony. No state severance tax, no environmental oversight. He even tried to disarm municipalities by taking away Home Rule Good fracking riddance. Sic Semper Gasholes “Democratic businessman Tom Wolf has won the Pennsylvania governor’s race, defeating incumbent Republican Gov. Tom Corbett, according to a CNN projection.”
New York State Allows Water Grab — Barely a football field away from John Marvin’s modest house, 42 black railcars full of water sit waiting for the signal to begin rolling south to supply fracking drill pads across the Pennsylvania border. When the water train lurches and clanks through the village — often at pre-dawn hours — it sounds ear-splitting whistles at each street crossing. Painted Post siphons water from a shallow, rain-dependent aquifer it shares with several neighboring communities, including the town of Corning. In 2012 the village signed a five-year deal reportedly worth up to $20 million with a subsidiary of Royal Dutch Shell to sell up to 1 million gallons a day used to frack Shell’s natural gas wells in Pennsylvania. The village has called the sale a routine disposal of “surplus property.” Marvin is the unlikely linchpin in one of a pair of lawsuits that seek to compel the state to enforce its tough environmental law amid a statewide scramble for water rights. Corporations and municipalities are now trying to lock in rights to withdraw water and in some cases sell water to the highest bidder, and they do not want environmental reviews to slow them down. . “It is an extremely dangerous practice to allow the commercial sale of public water and sets a precedent for the commodification of our water supplies,” “Water is a public trust, in law and in practice. When fracking or other private interests get the green light to buy water, the nature of this public trust is violated.” Marvin, the Sierra Club and others filed a suit against Painted Post and Shell, arguing that state law requires an environmental review of bulk water withdrawals, especially since the preservation of one of the state’s 18 primary aquifers is at stake. Last week Marvin’s case headed to the Court of Appeals, the state’s highest court, where the outcome could have sweeping implications for many New York municipalities.
Houston company’s fracking plans near W.Va. chemical plant on hold: A Houston company’s plans to drill for natural gas near a Marshall County chemical plant are on hold. A Marshall County circuit judge late last week issued a temporary restraining order blocking gas drilling, or fracking, by Gastar Exploration Inc. near Axiall Corp.’s chemical manufacturing plant at Natrium. A full hearing on the matter is scheduled for Nov. 12. The Charleston Gazette reports that the judge noted previous fracking there “did cause significant harm” to Axiall, and that the chemical maker faced “significant” likelihood of “irreparable harm.” The judge’s order is the latest move in an ongoing effort by Axiall to stop or at least slow down more natural gas development near the site. An incident last year damaged brine wells Axiall uses to obtain saltwater.
Scientists see fracking as cause of earthquakes in heartland - Evidence is growing that fracking for oil and gas is causing earthquakes that shake the heartland. States such as Oklahoma, Texas, Kansas and Ohio are being hit by earthquakes that appear linked to oil and gas activity. While the quakes are far more often tied to disposal of drilling waste, scientists also increasingly have started pointing to the fracking process itself. “Certainly I think there may be more of this that has gone on than we previously recognized,” Oklahoma Geological Survey seismologist Austin Holland told colleagues last week. In addition to what Holland has seen in Oklahoma, a new study in the journal Seismological Research Letters concludes that fracking caused a series of earthquakes in Ohio a year ago. That follows reports of fracking leading to earthquakes in Canada and across the Atlantic in the United Kingdom. Before 2008 Oklahoma averaged just one earthquake greater than magnitude 3.0 a year. So far this year there have been 430 of them, Holland said. Scientists have linked earthquakes in Oklahoma to drilling waste injection. Shale drilling produces large amounts of wastewater, which then is often pumped deep underground as a way to dispose of it without contaminating fresh water. Injection raises the underground pressure and can effectively lubricate fault lines, weakening them and causing earthquakes, according to the U.S Geological Survey.
'The Simpsons' Targets Evil Fracking: (video) Watch out, because greedy businessmen might start fracking under your neighborhood, making your drinking water flammable and causing earthquakes. The popular, animated satire “The Simpsons” made fun of hydraulic fracturing on its November 2 episode. More commonly called fracking, hydraulic fracturing is a process used to extract natural gas from shale buried deep underground. However, the show portrayed it as the dangerous venture of devious capitalists.At the climax of the episode, during an earthquake caused by Mr. Burns’ fracking, Marge persuaded Homer to “turn off that horrible machine” by reminding him that “our water was on fire.” Homer then had an epiphany, albeit a cynical one. “Wait, I finally get what you're saying. Fracking is great, but the only place it should happen is in other people's towns,” he said.
EPA Further Delays Hydraulic Fracturing Study as Controversy Builds -- EPA’s current estimate of the completion time for a draft of its study of the risks posed by hydraulic fracturing (“fracking”) to drinking water is now projected by the agency to be developed in early 2015. This is based on comments in a letter originating from EPA’s Region 8 office stating that the study on the risks posed by fracking to drinking water won’t reach draft final form until “early 2015”. [Region 8 Letter] The study was undertaken at the direction of Congress in 2009 when Congress requested EPA to conduct scientific research to examine the relationship between hydraulic fracturing in drinking water resources. Background and details of the study can be found at EPA’s website [here]. The initial plan was to issue initial results in 2012 and provide a final report in 2014, but EPA has regularly pushed back its timeframe projections. The idea of the study has been controversial from the start and has prompted controversy and criticism by interest groups and elected officials. See, for example, the objections raised in December 2013 by U.S. Chamber of Commerce President Thomas Donohue [here]. More recently, the Republican staff of the U.S. Senate’s Environment and Public Works Committee has issued a minority report which asserts that the impetus for the study was urged by “far left” interests intent on fighting against accessing domestic energy sources. [Link to Minority Staff Report]. Fracking has clearly expanded the availability of energy resources in the nation, but the concerns about potential impacts on drinking water and other resources remain unclear and have prompted substantial concerns. Over 30 states have moved to exercise some regulatory control over hydraulic fracturing activities, and EPA’s prolonged delay in pulling together any substantive scientific evidence regarding potential risks is simply making the controversy worse.
Illinois Just Approved Fracking, But Will Not Yet Disclose Regulations -- Illinois is now the latest state to officially approve hydraulic fracturing, or fracking, after lawmakers on Thursday signed off on long-awaited rules governing the controversial oil and gas drilling technique.However, it might be another week before Illinois residents know the details of those rules; while oil and gas drillers can now begin to apply for fracking permits, the final rule isn’t expected to be made public until November 15 at the latest.The secrecy is sparking outrage from environmentalists.“The rules were negotiated behind closed doors, without meaningful scientific review,” Annette McMichael of the group Southern Illinoisans Against Fracturing Our Environment told the Huffington Post. “There is no doubt they will be woefully inadequate to protect Illinois residents from the known harms horizontal fracking has brought to residents across America.”It’s been a long road to get fracking regulations approved in Illinois, even though the process has already started in some parts of the state. In June 2013, Gov. Pat Quinn proposed and signed into law what some considered to be the strictest rules for high-volume oil and gas drilling in the nation. After that law passed, the Illinois Department of Natural Resources (DNR) was required to develop its own regulations to be able to enforce Quinn’s law. But when the DNR proposed its fracking regulations in November 2013, environmentalists were surprised to find that they did not include — and in some cases undercut — some of the key protections in Quinn’s law. Specifically, the DNR’s regulations were easier on wastewater disposal, which is widely considered to be one of the biggest environmental threats that fracking poses.
Can American Indian reformers slow an oil boom? (Reuters) - A change in leadership at an American Indian reservation in North Dakota wouldn't normally get a whole lot of attention. But come Tuesday, the oil industry will be watching this dusty area of the state as two reformers vie to become tribal chairman, an office with outsized power over the course of the state's booming oil industry. That's because the reservation's Three Affiliated Tribes of Mandan, Hidatsa and Arikara (MHA) Nation control roughly a third of North Dakota's oil output. In the past two years alone, production on the MHA Nation has jumped 145 percent, cementing the state's role as the second-largest U.S. oil producer after Texas. The reformers, Damon Williams, the tribal attorney, and Mark Fox, the tax director, each propose tighter environmental regulations. They also promise to ensure more money goes directly to projects that improve life for the 12,000 tribal members on the 980,000-acre reservation. In other words: this stands to make things more complicated for the oil industry. So far, oil companies aren't saying a whole lot about the leadership change. EOG Resources Inc, the largest oil producer on the reservation, said its goal is "to maintain good relationships with tribal members regardless of the election's outcome." Lynn Helms, head of North Dakota's Department of Mineral Resources, the state's oil regulator, is blunter: Oil producers are "deeply concerned," he said, adding: "drilling on the reservation could be slowed." That's because if the tribes give stricter scrutiny to environmental issues, more stringent rules could mean more obstacles for new drilling permits.
Fracking pollution just went airborne -- From contaminated groundwater to polytechnic displays at the kitchen faucet, most of the major concerns around fracking have centered around how fracking fluids and methane could be polluting our water supply. But we’ve started to suspect that fracking impacts the air, too, and a new study published this week in the journal of Environmental Health adds one more piece of evidence to the pile. David Carpenter, director of the Institute for Health and the Environment at University at Albany, State University of New York — and the lead author of this study — says his findings support mounting evidence that fracking is a significant public health risk. Of particular concern is that fracking sites could become cancer clusters in years to come. Carpenter’s study found eight different poisonous chemicals near wells and fracking sites throughout Arkansas, Colorado, Pennsylvania, Ohio, and Wyoming that exceeded federal limits, including levels of benzene and formaldehyde — both known carcinogens, Carpenter told reporter Alan Neuhauser for U.S. News and World Report: “Cancer has a long latency, so you’re not seeing an elevation in cancer in these communities. But five, 10, 15 years from now, elevation in cancer is almost certain to happen … I was amazed,” Carpenter says. “Five orders of magnitude over federal limits for benzene at one site — that’s just incredible. You could practically just light a match and have an explosion with that concentration.” Around half of the air samples Carpenter analyzed exceeded federally recommended limits: Benzene levels were 35 to 770,000 higher than normal; hydrogen sulfide levels were 90 to 60,000 times higher; and formaldehyde levels were 30 to 240 times above a safe threshold.
Toxic Chemicals Found in Air Near Oil and Gas Wells - The Weather Channel -Oil and gas development sites are spewing toxic, cancer-causing gases into the air, according to new research, which adds to the limited, yet growing, evidence that these sites affect not only area nearby water quality, but also that of the air."This is a significant public health risk," Dr. David Carpenter, director of the Institute for Health and the Environment at the University at Albany-State University of New York and lead study author, told U.S. News, referring to the possibility of cancer cases linked to these sites 10 or 15 years down the line. For the data, community members from Arkansas, Colorado, Pennsylvania, Ohio and Wyoming tested the air around eight sites, showing in some cases chemical levels hundreds of times beyond what the federal government deems safe, according to a press release. "Benzene, formaldehyde and hydrogen sulfide were the most common compounds to exceed acute and other health-based risk levels," Carpenter wrote in the study, which was published in the journal Environmental Health. Benzene is a known carcinogen and formaldehyde has also been linked to cancer. "I was amazed," Carpenter told U.S. News. "Five orders of magnitude over federal limits for benzene at one site — that's just incredible. You could practically just light a match and have an explosion with that concentration."Previously, according to the study, research on the health effects of fracking had largely zeroed in on water quality; information about how fracking affects air safety is new and emerging, though environmentalists have long opposed evaporation ponds as a method of wastewater disposal for fears over the release of chemicals into the air.
Cancer causing air toxins detected at frack sites -- A peer reviewed study published Thursday in the journal Environmental Health reveals dangerous levels of air toxins near fracking operations. The carcinogen formaldehyde was the most common chemical found to exceed federal safety levels, according to Denny Larson, one of the report’s authors. Larson works with the nonprofit Global Community Monitor. “The number of [chemicals] that we found near these sites are alarming,” said Larson in a call with reporters. “They are, as the title of our report clearly says, a warning sign.”The deadly chemical hydrogen sulfide was also found in high levels in Wyoming samples. Hydrogen sulfide is known to kill oil field workers. A recent report by EnergyWire documents the dangers to shale oil production workers from air toxins.Volunteers in six states, including Pennsylvania, took air samples for the study. Pennsylvania’s samples show high levels of formaldehyde near compressor stations. The research was led by David Carpenter, a physician and director of the Institute for Health and the Environment at New York State University at Albany. Carpenter says he’s most concerned about the high levels of benzene and formaldehyde measured by the volunteers.“One thing about cancer is that it doesn’t happen tomorrow after exposure,” said Carpenter. “Cancer ususally takes at least five, but more often 10, 20 or even 30 years to develop. So our concern is that these carcinogens that were monitored near homes, near schools, near farms with animals, the people that are exposed are going to be at risk of developing cancer. But it will only appear in the future.” He says the formaldehyde is formed in two ways. One by combustion at compressor stations, but also as a byproduct of methane leaks, when exposed to the sun.
Study finds toxins, cancer-causing air pollution at oil, gas wells: A cadre of citizens taking air samples for a scientific study has found toxic emissions from Wyoming oil and gas operations, some that are many, many of times above federal health standards. In a six-state study published in Environmental Health, authors say the Wyoming samples show high concentrations of benzene, hydrogen sulfide, formaldehyde and more. Air samples taken in 13 of 15 sites in Park and Fremont counties exceeded the standards, prompting a call to action. Deb Thomas of Clark, one of the co-authors of the study, said residents close to increasing oil and gas developments are in peril and have been abandoned by government watchdogs. She is a director of the group ShaleTest, and formerly worked with the Wyoming-based landowner advocacy group Powder River Basin Resource Council. “They’re fighting for their lives,” she said. “Fracking not only fractures rock it fractures communities.” The groups Coming Clean and Global Community Monitor announced the results today, saying “The natural gas industry often claims that it provides ‘cheap energy,’ but we are paying the price with the endangerment of public health.” While reports of illnesses are not tied scientifically to oil and gas field emissions, the groups called for protection before severe harm occurs to the environment and people. Neighbors to oil and gas facilities suffer from headaches, rashes, loss of smell and taste, nosebleeds, neuropathy, kidney problems, pain, miscarriages and cancers, Thomas said. “People who are very eloquent can’t form their words any more,” she said of some effects.
Texans Vote To Ban Fracking --On Tuesday, voters in Denton, Texas, banned fracking within the city limits by a large margin of 59 to 41. The first such restriction in energy-giant Texas, Denton has been a hotly contested site for the industry and one of eight locales with fracking bans on the ballot this election. A city of about 125,000 residents located 35 miles northwest of Dallas, Denton sits atop the Barnett shale and already has some 275 fracked wells. “Hydraulic fracturing, as determined by our citizens, will be prohibited in the Denton city limits,” Mayor Chris Watts said in a statement, “the City Council is committed to defending the ordinance and will exercise the legal remedies that are available to us should the ordinance be challenged.” Those who voted for the ban worry about water and air pollution, the heavy demand for water, and the possibility that the process causes earthquakes. Researchers recently found alarming amounts of heavy metals such as arsenic in groundwater near fracking sites in Texas. Another high-profile fracking ban in Santa Barbara County, California failed to pass on Tuesday after the oil and gas industry spent close to $6 million opposing it. However a similar version in California’s San Benito County overcame oil and gas opposition and passed by a large margin, 57 percent to 43 percent. As of late Tuesday night, the third fracking ballot ban in California’s Mendocino County was leading by a large margin. In Ohio, voters in Athens approved a fracking ban, while those in three other communities defeated their own ban ballot measures, according to preliminary results reported by the Wall Street Journal.
Texas Town Passes Ban On Fracking In Its Birthplace - (Reuters) - Voters approved a ban on hydraulic fracturing in the North Texas town of Denton on Tuesday, making it the first city in the Lone Star State to outlaw the oil and gas extraction technique behind the U.S. energy boom. The vote in the city of 123,000 was highly symbolic because hydraulic fracturing, better known as fracking, is widely used in Texas, the top crude producer in the United States. Green groups said the result, which is sure to face legal challenges, served as a wake-up call to the industry. But several similar measures failed in cities and counties in Ohio and California. "Denton, Texas is where hydraulic fracturing was invented," said Bruce Baizel, Earthworks energy program director. "If this place in the heart of the oil and gas industry can’t live with fracking, then who can?" Fracking was pioneered in Texas at the Barnett shale formation where Denton is located. Exxon Mobil's XTO unit honed its shale expertise in the natural gas-rich Barnett. Exxon's headquarters are a short drive away in Irving, though most of the crude output in Texas comes from the growing Eagle Ford and Permian fields to the south and west.
Texas Town Bans Fracking ! - More towns and counties throughout the nation banned fracking yesterday, including Denton, where the voters told frackers to go back to Texas. Except that Denton is in Texas . . . Despite a dirty tricks campaign by the frackers to label local fractavists as puppets of the Kremlin, and being outspent 10 to 1 , the anti fracking vote was overwhelmingly in favor of a ban. Evidently what’s good for Exxon’s CEO is good for Denton. Or, for that matter, anybody. With 37 of 39 precincts reported by late evening, about 59 percent of voters in this college town of 123,000 had cast ballots for an ordinance that will drastically restrict drillers’ attempts to tap the rich natural gas reserves within the city limits. Calling the ordinance unconstitutional, state and industry officials have pledged to contest it in court and state lawmakers have said they may pass legislation to block it. Cathy McMullen, a home health nurse and leader of the Denton Drilling Awareness Group, which collected nearly 2,000 petition signatures to place the issue on the ballot, choked up, wiped away tears and hugged her husband as she celebrated Tuesday night at Dan’s Silverleaf, a downtown bar and concert venue not far from City Hall.“It says that industry can’t come in and do whatever they want to do to people,” McMullen said over the cheers of the 200 people jammed in the bar. “They can’t drill a well 300 feet from a park anymore. They can’t flare 200 feet from a child’s bedroom anymore.”
If adopted, Denton fracking ban would face legal tests -- Denton Mayor Chris Watts says that if his city adopts a fracking ban Tuesday, it won’t be the end of the story, but the beginning. The oil and gas industry, the state and landowners are already threatening to try to block enactment of the anti-hydraulic-fracturing measure — the first proposed in Texas — if voters approve it Tuesday…Attorneys experienced in municipal law, particularly oil and gas drilling ordinances, say the situation in Denton presents unique legal challenges and may ultimately answer questions about how far a city can go in regulating rigs before and after they’ve moved into neighborhood. Cities in other states have had varied success in banning fracking. In New York , a state appeals court ruled that towns can use zoning rules to prohibit hydraulic fracturing. But in Colorado , similar ordinances were struck down by lower courts and are now on appeal.
Texas Fracking Ban Faces Industry Challenge - WSJ -- Hours after voters here adopted the first hydraulic-fracturing ban in Texas, an energy-industry group filed a court challenge contending that the measure violates the state constitution.But in the city’s coffee shops and meeting places, many residents continued to express support for the ban on fracking, which backers said was necessary to halt industrial activities in residential neighborhoods. The ban was approved 59%-41%, passing even in some precincts where residents voted overwhelmingly for Republican candidates on the state and local level. Similar bans were adopted in an Ohio town and two counties in California, but were rejected by voters in Santa Barbara County, Calif., which has a long history of oil and gas activity. The Texas Oil and Gas Association’s lawsuit against the city, filed minutes after the courthouse opened Wednesday morning, contends that Texas law gives state agencies the responsibility for regulating drilling and fracking, in which water, sand and chemicals are used to free oil and natural gas from shale formations. The city’s ban pre-empts those laws, so is unconstitutional, according to the association. “Many of the wells in Denton cannot be produced without hydraulic fracturing, so a ban denies many mineral-interest owners the right to gain value from their property, despite the state’s public policy in favor of developing natural resources,” Thomas Phillips, the group’s lawyer, said in a written statement.
Oil and gas industry, Texas Land Office sue over Denton fracking ban -- Litigation over the passage of a hydraulic fracturing ban in Denton Tuesday night has already begun. The Texas Oil and Gas Association filed for an injunction in state court in Denton Wednesday morning to stop the ban from being implemented. And the Texas General Land Office, which controls oil and gas leases that fund public education, has sued the town too, calling the ban, “arbitrary, capricious and unreasonable.” “TXOGA believes that the courts of this State should give a prompt and authoritative answer on whether Denton voters had the authority under state law to enact a total ban on hydraulic fracturing within the city limits,” attorney Thomas R. Phillips, former Chief Justice of the Supreme Court of Texas said in a statement. “A ban on hydraulic fracturing is inconsistent with state law and therefore violates the Texas Constitution.” Denton is the first municipality in Texas to vote in a ban prohibiting hydraulic fracturing, which is used to extract oil and natural gas from shale formations. Similar ordinances in other parts of the country have met with limited success in the courts. One exception is New York where the state supreme court recently upheld towns’ rights to prohibit oil and gas drilling. Litigation over the fracking ban has been widely anticipated. And Denton city officials have said they are prepared to defend the ordinance in court.
Bush Family and Its Inner Circle Play Central Role in Lawsuits Against Denton, Texas Fracking Ban -- On November 4, Denton, Texas, became the first city in the state to ban the process of hydraulic fracturing (“fracking”) when 59 percent of voters cast ballots in favor of the initiative. It did so in the heart of the Barnett Shale basin, where George Mitchell — the “father of fracking” — drilled the first sample wells for his company Mitchell Energy. As promised by the oil and gas industry and by Texas Railroad Commission commissioner David Porter, the vote was met with immediate legal backlash. Both the Texas General Land Office and the Texas Oil and Gas Association (TXOGA) filed lawsuits in Texas courts within roughly 12 hours of the vote taking place, the latest actions in the aggressive months-long campaign by the industry and the Texas state government to fend off the ban. The Land Office and TXOGA lawsuits, besides making similar legal arguments about state law preempting local law under the Texas Constitution, share something else in common: ties to former President George W. Bush and the Bush family at large. George Prescott Bush — son of former Florida Governor and prospective 2016 Republican Party presidential nominee Jeb Bush and nephew of former President George W. Bush, won his land commissioner race in a landslide, gaining 61 percent of the vote. Given the cumbersome and lengthy nature of litigation in the U.S., it appears the Land Office case will have only just begun by the time Bush assumes the office. The TXOGA legal complaint was filed by a powerful team of attorneys working at the firm Baker Botts, the international law firm named after the familial descendants of James A. Baker III, a partner at the firm. Baker III served as chief-of-staff under both President Ronald Reagan and President George H.W. Bush, Secretary of State under George H.W. Bush and as a close advisor to President George W. Bush on the U.S. occupation of Iraq. He gave George P. Bush a $10,000 donation for his campaign for his race for land commissioner.
A County Resents Oil Drilling, Despite the Money It Brings In - — Dennis Seidenberger has farmed cotton for 49 years in this close-knit community 40 miles southeast of Midland. Farming is a way of life that he passed on to his son, and one that he hopes will stay in the family for generations. But his outlook has changed over the past three years as a surge in oil drilling has transformed Glasscock County, where he lives.“They’ve totally ruined our way of life here,” Mr. Seidenberger said. “I don’t know if I’ll ever get over it.”His sentiments sum up how many residents throughout the county view the drilling boom, despite the boost it has given to both the local economy and the county’s coffers.“If something happened and oil went to $50 a barrel and everything moved out of here tomorrow, I don’t think it would hurt anybody’s feelings in Glasscock County,” said One fact is crucial in understanding the anger toward the drilling that is pervasive among Glasscock County’s 1,251 residents: Most cotton farmers here do not own the mineral rights for the land that they farm. Under Texas law, the rights of mineral owners trump the rights of surface owners, meaning most Glasscock County farmers are powerless to stop energy developers from drilling wells, even as it destroys valuable crop land.
San Benito County's Measure J: Voters back anti-fracking plan - San Benito County voters on Tuesday approved a groundbreaking ballot measure that outlaws the controversial oil extraction technique known as fracking. San Benito County residents heavily supported Measure J, overcoming the oil industry's well-funded opposition campaign. A similar measure in Santa Barbara County, backed by environmentalists there, appeared to be heading to defeat. San Benito County attracted attention across California by placing the closely watched measure on the ballot to outlaw hydraulic fracturing, the oil-extraction technique known as fracking that has stirred environmental debate nationwide. The measure was fueled by supporters frustrated by the fact that Gov. Jerry Brown and state lawmakers have not banned fracking, a process that involves pumping water and chemicals underground to release oil and gas. The ballot pitch was an end-run around the politicians. San Benito's measure spawned similar measures elsewhere in California, including Santa Barbara and Mendocino counties, where voters were also asked to ban fracking. Butte County has proposed an anti-fracking measure for the 2016 election. The oil industry, worried about such copycat measures, fought back hard against San Benito County's proposal, pouring about $1.8 million into the opposition campaign. With Chevron, ExxonMobil, Occidental Petroleum and other oil giants writing checks, the opposition outspent Measure J supporters 15-1 during the campaign.
Frack Ban Votes - With a record number of fracking issues on local ballots in California, Texas and Ohio, the outcome was decidedly mixed. Of the eight measures—three in California, four in Ohio and one in Texas—four passed and four failed. Denton became the first city in Texas—a state where fracking has become big business—to pass such a ban, despite threats from the oil and gas industry to sue to overturn it. And it passed overwhelmingly, 59-41 percent, despite heavy spending by the industry. And the oil and gas industry has no one but itself to blame. Perhaps banning fracking in Denton, Texas will finally force the oil and gas industry to clean up its act. Because blaming the impacted community is a losing strategy. It lost them Denton, and it will lose them the hearts and minds of the country.” It has also lost the hearts and minds of Mendocino and San Benito counties in California and Athens, Ohio, while California’s Santa Barbara County and the cities of Kent, Gates Mills and Youngstown, Ohio weren’t ready to put a ban in place.
Fracking & Agriculture Clash In Colorado's North Fork Valley -- The United States is the world’s largest oil and natural gas producer. North Dakota and Texas are experiencing an oil boom. And many other states are seeing natural gas production increase through hydraulic fracturing.Colorado has nearly 53,000 active wells. But, the state’s energy boom is a source of tension. There's a new alliance of farmers and food producers trying to keep fracking from taking place in the North Fork Valley, an agricultural area in Western Colorado known for its organic farms, orchards, and vineyards. Brent Helleckson and his wife have been growing grapes in this area for 20 years. He says the microclimate of the area is unique. It’s compared to other agricultural hubs throughout the world, like the Hindu Kush region of Afghanistan or Provence in France. "The North Fork is also home to the West Elk American Viticultural Area, which is a geographic area designated by the federal government that has a unique climate, geology, geography that results in wines that have a unique character that can be identified," Helleckson says.
Mixed results for local anti-fracking measures - Voters in some localities in Texas, Ohio and California voted to ban or put new restrictions on hydraulic fracturing for oil and natural gas, though other ballot measures in those states failed. Denton, Texas; Athens, Ohio; and San Benito and Mendocino counties in California passed ballot measures to restrict fracking, the controversial method of injecting fluid into wells to extract more oil and gas. The Natural Resources Defense Council (NRDC) said the passed measures show a growing trend of localities opposing fracking. “Whether this happens at the polls, through local governments or in the courts, the message is clear: Americans are demanding the right to determine their own fracking fate,” Kate Sinding, director of the NRDC’s Community Fracking Defense Project, said in a statement. She put the blame for the defeated measures solely on the industry.
Energy seen getting biggest boost from Republican Senate - (Reuters) - While the Republican Party won't assume its Senate majority until January, U.S. stock investors are already betting the new congressional makeup could lead to faster action on pipelines and trade agreements, sending energy shares higher on Wednesday. Wall Street rose broadly in its first session after midterm elections, but energy and medical device companies - two sectors that could see a more direct impact from legislative measures - had outsized moves. Part of the broader market's move came on relief that the Senate majority party was not in doubt; investors had been concerned some close races would be forced into run-offs, an outcome that could have delayed knowing who would control Congress's upper chamber for weeks. "It had looked like some of the races would be very close and that we might not know who controlled the Senate, but in the end, the results were pretty decisive," said John Carey, portfolio manager at Pioneer Investment Management in Boston. "That's good news for the industries that had been subject to regulatory issues."
The GOP has a legislative plan for Washington. It has some problems. -- There may be some cracks in the concrete plans that GOP congressional leaders say they are laying for the new era of Republican control. Senate Republican leader Mitch McConnell (Ky.) and House Speaker John A. Boehner (Ohio) have plans to send President Obama bills with bipartisan support, but it isn’t clear that they can command the support of all Republicans, much less Democrats, or whether the measures would have the desired effect after passage. McConnell and Boehner are looking at sending the president bills that would approve the Keystone XL pipeline, give him fast track authority to negotiate international trade agreements, repeal an unpopular medical device tax and change the definition of a full-time worker under the Affordable Care Act. Each of those faces hurdles. The permit application for the Keystone XL pipeline, which would carry Canada’s oil sands to the Texas Gulf Coast, has been languishing for six years while awaiting the outcome of a State Department process. Obama has refused to let himself be forced into a decision, but he has left open the door for approval. If Obama wants, he could veto a Keystone bill and it would probably stick, albeit not by much. A non-binding resolution last year fell five votes short of the number needed to override a veto. And while the GOP picked up several Senate seats, at least four ousted or retiring Democrats were in favor of the pipeline anyway. On May 22, 2013, the last time the House voted on a pro-Keystone amendment, it passed by a 241-175 margin, not enough to override a veto. More importantly, the pipeline has also been held up by a lawsuit in Nebraska that says the state did not follow the correct process because it tried to short-circuit the approval process. The state legislature passed a bill giving the governor approval authority instead of the state’s department of environmental quality.
In North Dakota, Oil Industry Will Now Have A Harder Time Drilling On Tribal Land -- On Tuesday, tribal residents in North Dakota elected a leader who is committed protecting the environment from the industry’s rapid expansion. At the same time, North Dakotans voted strongly against a measure that would have redirected five percent of the state’s oil extraction tax revenue toward conservation activities. The “North Dakota Clean Water, Wildlife and Parks Amendment,” otherwise known as Measure 5, was defeated by a wide margin, with around 80 percent voting no. The fossil fuel industry vehemently opposed the measure, with Steve Adair, campaign chairman for Measure 5, telling ThinkProgress last week that outside oil groups such as the Washington-D.C. based American Petroleum Institute, were running their opposition “like a U.S. Senate campaign.” North Dakota has been transformed in the last few years by the oil industry, and proponents of the measure saw it as a way of guaranteeing the long-term interests of the state are maintained even as the industry is accommodated. The proposal would have required North Dakota to use five percent of the state’s oil and gas extraction taxes — as much as $150 million a year — for creating parks, improving fish and wildlife habitats, preventing flooding, and maintaining water quality. “There’s no more cogent opposition to Measure 5 than oil companies wanting to make more money. Careful reading of Measure 5, and common sense, led the Environmental Law Society to the conclusion that this is the right action and the right time.”
Feds Approve Plan To Send Trains Through D.C. Neighborhood, Despite Fears Of Hazardous Materials - A group of southeast D.C. residents have lost a key battle in their fight against the reconstruction and expansion of a freight train tunnel in their neighborhood, which they fear will bring an unnecessary risk of freight car derailment and explosion just one mile from the U.S. Capitol. The Federal Highway Administration (FHWA) on Tuesday approved the proposal from CSX Corp. to reconstruct the Virginia Avenue Tunnel, a 3,800-foot-long tunnel that runs trains beneath Virginia Avenue SE. The purpose of the project is not only to update the tunnel’s 110-year-old infrastructure, but also to expand it, converting the single-track tunnel into two tracks and allowing for double-stacked cars. Residents are not unilaterally opposed to CSX updating its infrastructure, but they are concerned about what will happen with trains during the estimated three to four years of construction. During reconstruction of the tunnel, CSX plans to run its trains through an open trench located directly next to its construction of the old tunnel, next to an elevated highway, and next to residents’ homes. The main issue residents have is whether CSX will transport oil or hazardous materials through that open trench, increasing the risk of a dangerous derailment. But in its decision approving the project, the FWHA said the concern was “not relevant.” “The issue of what types of freight CSX should be allowed to transport through the District is not relevant to the Project,” the decision reads.
Total of 125 Arrested Protesting Infrackstructure (photos)
- Trade blog notes trend of heat turned up on FERC, even publishes the FERC Rubber Stamp song: click here.
- Reportback on 124 cumulative arrests in 5 actions: click here.
- EcoWatch covers the MondayMorning arrests at FERC in DC: click here.
- Photos from Monday at FERC in DC: click here.
- Democracy Now features the arrests at Seneca Lake: click here.
- Reportback on Monday arrests at Cove Point construction site in Maryland: click here.
- Capitol NY article on Port Ambrose opposition gearing up on Long Island: click here.
- Vermont Governor buys pizza for protestors before arresting them:click here.
- Climate marchers arrive in DC after 8 months and 3000 miles:click here.
- Reportbacks on three arrested in Rhode Island for sit in at Senator Reed’s office: click here.
“Win ugly or lose pretty”: Secret tape reveals Big Oil’s sleazy P.R. pep talk - How do you take on a growing popular movement that’s figured out the link between the fossil fuel industry and the destruction of our planet? According to a secret recording obtained by the New York Times, lobbyist Rick Berman told Big Oil to do what it does best: play dirty. “Think of this as an endless war,” Berman, the man once dubbed “Dr. Evil” by “60 Minutes,” told a roomful of gas and oil executives this past June in Colorado Springs. “You can either win ugly or lose pretty.” That we know all this is courtesy of one of Berman’s audience members, who was so skeeved out by the proposed smear tactics that he went running to the liberal media. “It just left a bad taste in my mouth,” the unnamed executive told the Times. Here, from the complete transcript of “Big Green Radicals: Exposing Environmental Groups,” are some of the hot tips inspired from his history taking on healthcare, labor unions and the Humane Society while representing the soda industry, the food industry and alcohol manufacturers. Big Oil can learn from the tactics Berman’s used to attack Obamacare: His P.R. firm, Berman and Co., influenced public opinion in the absence of facts by taking out an ad in the New York Times telling people, “Hey, you ought to be concerned about the health care bill.” They didn’t bother to explain why. Berman calls this going on the offensive, and it’s useful in a variety of situations: “I get up every morning and I try to figure out how to screw with the labor unions — that’s my offense,” he said.
Federal Reserve Policy Keeps Fracking Bubble Afloat and That May Change Soon - Steve Horn: While the “Halliburton Loophole” is well-known to close observers of the hydraulic fracturing (“fracking”) issue, lesser known is another blessing bestowed upon shale gas and tight oil drillers: near zero-percent interest rates for debt accrued during the capital-intensive oil and gas production process. Or put more bluntly, near-free money from the U.S. Federal Reserve Bank. In response to the economic crisis and near collapse of the global economy, the Federal Reserve dropped interest rates to between 0% and 0.25% on December 16, 2008, a record low percentage. It also began its bond-buying program, described in a recent Washington Post article as implemented to provide a “booster shot” to the economy. That free money, known by economics wonks as quantitative easing, helps drilling companies finance fracking an increasingly massive number of wells to keep production levels flat in shale fields nationwide. But even with the generous cash flow facilitated by the Fed, annual productivity of many shale gas and tight oil fields have either peaked or are in terminal decline. This was revealed in Post Carbon Institute's recently-published report titled, “Drilling Deeper: A Reality Check on U.S. Government Forecasts for a Lasting Tight Oil & Shale Gas Boom.” Were it not for the Federal Reserve's policy, the ever-accelerating drilling treadmill would likely slow down, making shale oil and gas production a far less lucrative endeavor for oil and gas companies and the financiers bankrolling it. Some articles in the business press, including in the Houston Chronicle and Bloomberg, speculate the Fed could lift interest rates on debt in 2015. That would sharply hinder many smaller and mid-level independent oil and gas companies.
Falling Oil Prices Make Fracking Less Lucrative : NPR: Oil prices are down than more than 25 percent since June and are staying low for now. Drivers may appreciate that, but for oil companies, it's making some of the most controversial methods of producing oil less profitable — and in a few cases, unprofitable.Most of the world's oil is selling for about $80 to $85 a barrel now. But not all oil is created equal. In the Middle East, it's cheaper to produce, at a cost of less than $30 a barrel on average, according to the Norwegian firm Rystad Energy.But in the Arctic, producing a barrel costs $78 on average. From Canada's oil sands, it's an average of $74 a barrel. And because those are averages, some companies have costs that are higher — which means there could be drillers currently producing crude at a loss.Here in the U.S., the oil drilling boom is due largely to technologies like hydraulic fracturing, or fracking, used to force oil from shale formations deep underground. Producing this oil, Rystad figures, costs an average of $62 a barrel."What is really interesting for the U.S. drillers and producers is how long they are going to continue the high activity levels that they have, now that prices are going down,"
About That Shale Oil 'Miracle'......people love to hear about how technology always saves the day... "Among the thousands of shale producers, you can guarantee there are pioneers just like those who started the shale revolution. As profit margins erode due to low or even lower future prices, the pioneers will try out the revolutionary new shale techniques that have yet to be deployed." It sounds good in the same way that Twinkies taste good. We would remind people here that back in the 1700's the South Sea company, the stock shares of which bubbled up enormously - even causing Isaac Newton himself to lose the then-staggering sum of 20,000 pounds - was billed as “a company for carrying out an undertaking of great advantage, but nobody to know what it is". Would it be unreasonable to restate the author's claim as "shale operators to deploy new technology of great advantage, but nobody to know what it is?". Ungrounded hype is the same thing no matter when or where it happens.
The Threat from Saudi Arabia’s Oil Power Play -- We’ve been here before. By “here,” I mean Saudi Arabia throwing its weight around in the global oil markets and triggering what we can only call a kind of reverse oil shock as a result. The consequences were particularly visible on Tuesday, when Saudi Arabia slashed the price at which it is willing to export crude oil to the United States, even as it boosted prices to buyers in Europe and Asia. That sent the benchmark U.S. crude oil price — West Texas Intermediate — skittering down to $76.45 a barrel, a level not reached in three years. If you thought that crude oil prices were set simply by what is happening to the global economy — the forces of supply and demand, and the answers to pressing questions such as whether China’s economy can struggle back to health — then you’ve simply been reading too much Adam Smith lately. Or else you have forgotten the history of the oil market.When the magnitude of the U.S. shale oil boom began to become clear and forecasts put U.S. energy output on track to outpace that of both Russia and Saudi Arabia by 2020, it seemed as if the limiting factors were the global economy (demand) and technology (supply). Clearly, those are still crucial, and have played a role in the deflation of what some have labeled a shale oil bubble. This isn’t the first time that Saudi Arabia, with the help of its friends in OPEC, has used the cartel to keep its own market clout more or less intact and its own revenues flowing, sacrificing higher prices to that end. If it succeeds, it can dampen investor enthusiasm for shale oil in the U.S. and starve companies of the capital they need, forcing them to shut down wells in response to lower prices.
Shale Drillers Idle Rigs From Texas to Utah Amid Oil Rout - The shale-oil drilling boom in the U.S. is showing early signs of cracking. Rigs targeting oil sank by 14 to 1,568 this week, the lowest since Aug. 22, Baker Hughes Inc. (BHI) said yesterday. The Eagle Ford shale formation in south Texas lost the most, dropping nine to 197. The nation’s oil rig count is down from a peak of 1,609 on Oct. 10. Drillers are slowing down as crude prices tumbled 24 percent in the past four months. Transocean Ltd. (RIG) said yesterday that its earnings would take a hit by a drop in fees and demand for its rigs. The slide threatens to curb a production boom in U.S. shale formations that has helped bring prices at the pump below $3 a gallon for the first time since 2010 and shrink the nation’s dependence on foreign oil imports. “We are officially seeing the slowdown in oil drilling,”
When the Shale Runs Dry: A Look at the Future of Fracking -- If you want to see the future of the shale industry — what today's drilling rush will leave behind — come to Bradford, Pennsylvania. A small city, it was home to one of America's first energy booms, producing over three quarters of the world's oil in 1877. A wooden oil rig towering over a local museum commemorates those heady days, marking the first “billion dollar oil field” in the world. But times have changed dramatically in Bradford. Most of the oil has been pumped out, leaving residents atop an aging oil field that requires complicated upkeep and mounting costs. Since its height in the 1940's, Bradford's population has steadily declined, leaving the city now home to only 8,600 people, down from over 17,000. The story of Bradford these days is a story of thousands of oil and gas wells: abandoned, uncapped, and often leaking. Rusted metal pipes — the old steel casings from long abandoned wells — jut from lawns and roadsides. Mailboxes are strapped to some of the taller pipes. In autumn, abandoned wells are tucked behind Halloween props and hay bales in front yards. The aging steel pipes aren't just on land. They line creek beds, water flowing around one rusted pipe then another. Hundreds are even submerged in the Allegheny Reservoir, small bubbles of methane gas the only visible sign of their existence. But in many cases, these rusted top hats from now deceased wells simply protrude from locals' lawns. They are visual reminders that, for local communities where mining or drilling happens, fossil fuel wealth burns hot and short. Where there's a boom, there's bound to be a bust.
Landowners upset about delays in property restoration as new Enbridge pipeline opens -- Oil is flowing through Enbridge’s new pipeline in southern Michigan, but people who live along the pipeline say the job isn’t done yet. Enbridge’s new Line 6B pipeline is in the ground and in service. It runs for 285 miles across the state from Griffith, Indiana to Marysville, Michigan. The company installed this new pipeline after their old pipeline burst and caused a massive oil spill in 2010. To replace it, they had to cut down trees and tear up people’s land. Enbridge has hired contractors to restore those properties in phases. But some landowners in the first phase of the project say they’re still waiting for work to be wrapped up. Jeff Insko and his wife Katy Bodenmiller also live along the pipeline, near Holly. Insko writes a blog about the pipeline project. He says he’s heard from at least 15 other landowners who say Enbridge still has work to do on their properties.“Virtually every landowner that I’ve spoken to has some small or large matter that is incomplete, whether it’s a basement that is flooding because of the re-grading that happened when they filled in the trench, or a promise that trees will be planted that have yet to be planted. Countless landowners up and down this pipeline have a story like that,” he says. Some promises from Enbridge are in signed documents, but others were made over the phone, or by email.
How Will Fracking Affect Your Homeowners Insurance? - The method of natural gas drilling known as hydraulic fracturing, or “fracking,” has caused controversy across the U.S. Advocates argue that it promises increased energy independence. For others, it means environmental catastrophe. In the ongoing debate, two things are for sure. The practice is responsible for much of the recent spike in natural gas production in the United States, and homeowners are often caught in the middle. Those who lease their land for drilling can see huge profits, but some reports suggest that these profits come with risk for both lessors and their neighbors – and who pays for these risks can be a complicated question. Nationwide Insurance made headlines in 2012 when an internal memo stating that its policies did not cover homeowners for fracking damage was leaked. In response to the fallout, Nationwide said that this was business as usual. Bob Hartwig of the Insurance Information Institute agrees: “All homeowners insurance policies exclude damage from such things as environmental contamination. This is nothing new.” Of course, pollution isn’t the only risk from fracking that activists have cited – and some of these risks may be covered. Homeowners with an earthquake endorsement can get coverage for earthquake damage, even if the quake is linked to fracking. “If there’s a fire or explosion, as a general rule, that would be covered,” Hartwig adds. This only applies to homeowners who live near fracking sites. For those who’ve leased their land – in effect, making it a business – insurance is more complicated.
New Oil Train Safety Rules Divide Rail Industry: Three days after an oil train derailed and exploded in 2013 in Lac-Mégantic, Quebec, killing 47 people, Greg Saxton wandered through the disaster site inspecting tank cars. For Saxton, the damage was personal. Some of the tank cars were built by Greenbrier, an Oregon-based manufacturer where he's chief engineer. Almost every car that derailed was punctured, some in multiple places. Crude oil flowed from the gashes, fueling the flames, covering the ground, and running off into nearby waterways. Each day, as Saxton returned to the disaster zone, he passed a Roman Catholic church. "We never came and went when there wasn't a funeral going on," he said. In the wake of this and other recent accidents as energy production soars in North America, Canadian and U.S. regulators are proposing new safety rules for tank cars that carry oil, ethanol, and other flammable liquids. Saxton and Greenbrier have pushed for swift changes, but others in the industry are asking for more time to retrofit cars like the type that exploded at Lac-Mégantic. "We've been frankly just perplexed and confused by the resistance." The tank cars that derailed at Lac-Mégantic were built before October 2011, when the Association of American Railroads mandated safety enhancements to the oil and ethanol tankers known in the industry as DOT-111 cars. The cars lacked puncture-resistant steel jackets, thermal insulation, and heavy steel shields, all of which could have lessened the destruction, experts say.
Obama May Have To Shut Down Government To Halt The Keystone Pipeline -- It would appear the first big test for President Obama's 'veto' pen will be no lesser issue than the Keystone Pipeline. Reuters reports that Republicans will quickly introduce stand-alone legislation in the first quarter of 2015 that would approve the Keystone XL crude oil pipeline from Canada, Republican Senator John Hoeven said in an interview. "It's really a good chance to see if the president's willing to work with us," Hoeven said, suggesting they would pressure Obama to act one way or another by attaching the bill to some must-pass legislation leaving Obama's only option but to fold or shut down the government. As Reince Priebus exclaimed, "he's going to be boxed in."
How Oil Companies Lost $17 Billion Defying Environmental Activists Over Canada’s Tar Sands - If oil companies are rational economic actors, and climate activists want to keep them out of Canada’s tar sands, it’s worth asking just what cost those companies have suffered for trying to produce that oil over the environmental community’s objections. Thanks to a new study by the Institute for Energy Economics and Financial Analysis (IEEFA), and Oil Change International, we now may have a dollar figure: $17 billion. The report —Material Risk: How Public Accountability Is Slowing Tar Sands Development — looked into the delays and project cancellations that have been caused by public opposition to the development of the tar sands. The ongoing battle over the Keystone XL pipeline is the most prominent example. But what it all adds up to is transportation bottlenecks, and falling profits for the industry even as crude oil has kept flooding in from Canada’s tar sands fields. That difference between what oil companies have sold and what they could have sold in the absence of the bottlenecks amounts to $30.9 billion from 2010 through 2013, according to the analysis. A good portion of that is from the inevitable changes and risks that come along with any marketplace. But after going through the various circumstances of the last few years, and teasing out various signals in the data, the researchers concluded that $17.1 billion (or 55 percent) of that “can be credibly attributed to the impact of public accountability campaigns.” The researchers also note that nine of the ten leading oil producers in the Canadian tar sands have underperformed that stock market in the last five years, and that industry observers have begun downgrading their projections for future production in the tar sands.
Is there really an oil glut? -- The swift price decline of Brent Crude from $110 on July 1 to about $85 today has the media buzzing about a glut. But can oil which now trades at eight times its price in 1998--when there really was a glut--be said to be experiencing a glut now? Certainly, there is more oil available than people are willing to pay $100 per barrel for. While there have been many explanations for the downward move in price, all we can say for sure is that recently there were more sellers than buyers; and so, the price slid as the buyers stepped away, waiting for the price to come down. But, is this really a glut? In 1998, even what poor people were paying for oil and oil products was relatively affordable, making it easier for them to enjoy the power and comforts that cheap oil and cheap energy in general make available to individuals. Now, the price of energy and oil, in particular, is leading some of the newly poor in Greece (made so by that country's ongoing economic depression) to seek out firewood--both legally and illegally obtained--to heat their homes instead of heating oil. The drop in vehicle miles traveled in the United States in recent years suggests that high gasoline prices are in part responsible for fewer miles traveled. When it comes to total U.S. petroleum consumption, the top 10 weeks for consumption occurred from 2005 to 2007. The most recent consumption number (week ending October 24) remains 2 million barrels per day below the peak reading in 2005. European petroleum consumption remains in a downward trend as well. All this suggests a decline in the standard of living for most Americans and Europeans, at least, when it comes to oil and its benefits. (One colleague of mine now speaks of peak benefits from oil rather than peak oil.)
Venezuela, with world's largest reserves, imports oil — For the first time in its 100-year history of oil production, Venezuela is importing crude — a new embarrassment for the country with the world's largest oil reserves. The nation's late president Hugo Chávez often boasted the South American country regained control of its oil industry after he seized joint ventures controlled by such companies as ExxonMobil and Conoco. But 19 months after Chávez's death, the country can't pump enough commercially viable oil out of the ground to meet domestic needs — a result of the former leader's policies. The dilemma — which comes as prices at U.S. pumps fall below $3 per gallon — is the latest facing the government, which has been forced to explain away shortages of basic goods such as toilet paper, food and medicine in the past year. "How much longer do we have to hear that the government's economic policies are a success when all we see is one industry after another being affected?" While Venezuela has more than 256 billion barrels of extra-heavy crude, the downside is that grade contains a lot of minerals and sulfur, along with the viscosity of molasses. To make it transportable and ready for traditional refining, the extra-heavy crude needs to have the minerals taken out in so-called upgraders, or have it diluted with lighter blends of oil. The latter tactic is what state oil company Petroleos de Venezuela SA (PDVSA) is using since it doesn't have the money to build upgraders, which perform a preliminary refining process, and its partners have been unwilling to pony up cash because of the risk of doing business in the country.
Saudi Arabia Raises Asia, Europe Prices; Cuts US Prices -- It appears, just as we warned two weeks ago, that the 'dumping strategy' designed to punish Obama's nemesis Putin could have morphed into a Saudi Arabian strategy to keep its foot on the neck of the US Shale Oil industry. In an awkward headline for mainstream media to explain, The Kingdom has raised prices of its Arab Light crude exports to Asia and Europe but cut prices to the USA significantly, potentially pressuring domestic suppliers with foreign 'cheap' imports. While not a primary course of US oil, we suspect the signaling of this move is more worrisome for Shale capex (especially as we noted Saudi Arabia can survive 7.9 years at lower prices) Forget currency wars, meet oil wars...
WTI Tumbles To 29-Month Lows After Saudi Price Cut -- After initially jerking higher after Saudi Arabia released its new 'lower-prices-for-the-US' strategy, it appears the market began to realize that in fact - as we warned - Saudi Arabia may be willing to accept prices "lower for longer." WTI futures are trading below $78.50 - the lowest since June 2012 (and its dragging Trannies lower today)... As Bloomberg reports, confirming our note over the weekend, Saudi Arabia, the world’s biggest oil exporter, is telling the market it won’t cut output to lift crude back to $100 a barrel and that prices must fall further before it does so, according to consultant FACTS Global Energy. Swelling supplies from non-OPEC producers drove Brent crude into a bear market on Oct. 8 amid waning demand from China, the world’s second-largest importer. The Organization of Petroleum Exporting Countries meets Nov. 27 to consider changing its production target in the face of the highest U.S. crude output in almost 30 years. “Production of shale oil in the U.S. will not be hit as hard as the Saudis think” by the price decline, FGE Chairman Fereidun Fesharaki said at a conference today in Doha, Qatar. Producers in the U.S. “can withstand a lot of pressure” by reining in their operating costs before they curb investment in new wells and production, he said.
OPEC shaken by Saudi price move - (AP) — Saudi Arabia showed little concern for fellow OPEC members by unilaterally cutting its oil prices to the U.S. this week, a move that casts doubts on the cartel's credibility and its ability to find a common plan to stabilize the slumping energy market. And while OPEC struggles to find consensus, oil prices risk remaining low — or falling further — to the benefit of consumers and businesses in the U.S. and worldwide. OPEC is already riven by differences among its members on what the ideal price level should be. That is exemplified in the rivalry between heavyweights Saudi Arabia, which can withstand lower prices, and Iran, which relies on a stronger market to remain profitable. The Saudis' unexpected move on Monday to cut prices to the U.S., aimed at protecting their market share there, will exacerbate those conflicts — weighing on the market and hurting most other OPEC members economically. "At the end of the day, this is still the Saudis' cartel for better or worse, and for smaller members this is definitely worse,"
Saudi Cut In Oil Price for US May Lead To Price War - Saudi Arabia’s move to cut the cost of its oil to US customers has injected fear into the oil markets, bringing the price of OPEC crude below $80 and suggesting to some observers that the cartel is preparing for a global price war. OPEC production has remained level despite worldwide demand, and as a result, on Nov. 5, the cartel reported that its basket price – the average price of its leading grades of crude oil – had dropped to $78.67 a barrel the day before, the lowest in about four years. And US production has reached its highest level in more than three decades, creating a buyer’s market for oil. Saudi Arabia cut its price for US customers on Nov. 3. Meanwhile, along with Saudi Arabia, Iraq and Iran, two other major OPEC producers, also are cutting prices to Asian customers this month. The reason for the Saudi move is a matter of some dispute. Some observers of the global oil market view the Saudi price cut to US customers as an effort to undermine the boom in American production of oil from shale.“The market reacted to it very negatively, thinking, ‘Here we go, we’re going to have a price war in the United States,’ ” But another person familiar with the Saudi decision, whose name was not disclosed, told the newspaper that the aim was merely to lure US refiners to buy cheaper oil from Saudi Arabia and thus increase their profits. Whatever the Saudi motivation, industry insiders and observers from OPEC officials to oil price news services view these actions as leading to a price war. In Baghdad, for example, Iraqi Oil Minister Adel Abdul Mahdi told parliament on Oct. 30 that the struggle is internal in OPEC, with members fighting one another to hold on to their shares of the petroleum market.
Crude oil hasn’t bottomed yet, traders say: Crude oil may have found its way off of the multiyear low it hit on Tuesday. But according to two traders, bearish dynamics on the supply and demand sides mean it's too early to call the bottom just yet. "There are so many factors in the equation that are putting downward pressure," on crude oil, Brian Stutland said Thursday on CNBC's "Futures Now. "In the U.S., our oil drums are almost starting to fill up and hit max capacity. You have the Saudis now saying they're going to lower prices in the United States. You have weaker demand in China. And on top of that, a stronger dollar, and crude oil trades in U.S. dollars." Read More U.S. crude settles above $77 after hitting 3-year low "I think you have to be careful trying to buy bottoms here on such a volatile asset class right now," Stutland concluded. In fact, he favors making a bearish play on oil futures. Specifically, he advocates selling December crude oil futures at $77.50 per barrel, with a target of $74.50. "We are just pumping more oil out of the shale plays here in the United States than you can imagine, and that is really putting pressure on oil," Scott Nations agreed. "$75, $74.50 is completely doable."
"Saudis Have Good Reason To Be Concerned" Warns Ex-CIA Officer, As ISIS Enters World's Largest Oil Exporter -- For the longest time there has been speculation whether Jihadist forces, be they ISIS, Nusra or other regional groups, had managed to spread beyond the Iraq conflict zone and infiltrate the world's oil mecca: Saudi Arabia. We now know the answer: according to Bloomberg, a Saudi citizen suspected of organizing the attack on Shiite worshipers in the oil-rich Eastern Province returned from fighting in Iraq and Syria, according to Saudi-owned newspapers. In short, ISIS has arrived in the world's largest oil exporter, which begs the question: was yesterday's news of an oil pipeline explosion, quickly downplayed by Saudi sources as "maintenance-related", in fact what most assumed at first, namely an act of sabotage? And how long until the next "planned maintenance" pipeline explosion?
Obama's Secret Letter to Iran About ISIS: Good Idea? Foolish Cooperation? Hidden Agenda? -- Big splash in the news today following the Wall Street Journal report Obama Wrote Secret Letter to Iran’s Khamenei About Fighting Islamic State. Obama's exact letter has not been published (yet), but the subject matter includes shared interests in combating ISIS coupled with hope of progress on nuclear talks. The Journal reports "cooperation on Islamic State was largely contingent on Iran reaching a comprehensive agreement with global powers on the future of Tehran’s nuclear program by a Nov. 24 diplomatic deadline" according to correspondents briefed on the letter. As with Russia more recently, the sanctions against Iran did not work, and will never work. Sanctions in general don't work, period. The Republican response is as one might expect. Worse yet, Senators Mark Kirk (R., Ill.) and Robert Menendez (D., N.J.) introduced bipartisan legislation to intensify sanctions. “The best way to prevent Iran from getting a nuclear weapon is to quickly pass the bipartisan Menendez-Kirk legislation—not to give the Iranians more time to build a bomb,” Mr. Kirk said Wednesday. Was Obama's letter to Iran a good idea? Of course it was. Dialog is generally a good idea. Obama's letter opening up discussions with Iran is one of the few things he has done right. Of course, this dialog comes on the heels of unwise sanctions, so all it does is get us back to where we should have been years ago.
Oil: "It's The Economy, Stupid" -- The cacophony of various talking heads proclaiming this morning that oil price weakness is not due to weak demand but to over-supply (which are obviously merely different sides to the same coin) was deafening. While he hate to steal the jam from their aggregate donuts, the following chart may just provide a hint at what is really driving oil prices... "it's the economy, stupid!" Correlation is not causation but.. well in this case, it is! * * * But while this chart is an inconvenient truth, we are sure the meme of US growth saving the world will continue to be spewed as gospel (oh wait a minute... isn't the entire sell-side now taking a chainsaw to their Q3/Q4 GDP growth estimates after construction spending and trade deficit data?)
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