12-19-14 Chevron Exits 'Economically Uncertain' Arctic OCS - Regulators Question Alaska's Arctic Gas Project
On December 11, 2014, the National Hydrocarbon Commission of Mexico announced the proposed terms for the shallow water bidding round, consisting of the Bid Conditions and the Model Contract. Our friend, Pedro van Meurs (NGP Photo), along with J. Jay Park, Q.C., prepared a joint commentary on both these documents. This report is available for free to interested parties. Click Here to download the document.
BP's Alaska Hire rate continues to exceed 80%, and spending with Alaska companies is 81% of total in-state spending, according to its 2014 Alaska Hire report. BP Publishes Alaska Hire each year to focus on education, training and mentoring programs that are designed to bring more Alaskans into the oil and gas industry. Readers may access Alaska Hire here
Reuters (Reporting by Scott Haggett; Editing by Cynthia Osterman) - Chevron Corp said on Wednesday a plan to drill for oil in the Beaufort Sea in Canada's Arctic is on hold indefinitely .... In a letter to Canada's National Energy Board, the company withdrew from a hearing into Arctic drilling rules because.... (More)
REGULATORS QUESTION ALASKA LNG PRELIMINARY PLANS (From Office of the Federal Coordinator)
In their first feedback on Alaska LNG's preliminary construction plans, federal and state agencies raised dozens of questions and issues they want to make sure are covered as the project sponsors progress with design and environmental analysis.
The agencies on Dec. 11 asked the project sponsors for more information about where they plan to get construction gravel, how they plan to lay a pipeline across Cook Inlet and what kind of wear and tear state roads and bridges would endure as tons of materials move across Alaska during construction.
The requests for more information were expected as the sponsors are in the early stages of their design, route selection and construction planning for the LNG export project.
Today's Consumer Energy Alliance Energy Links:
Downstream Today: Keystone XL: Oil, Gas Industry Awaits Fate of the Pipeline's Final Phase.
If oil sands from Canada will make it to the market whether the pipeline is built or not, then moving the product through a pipeline would not only produce fewer emissions than transporting it using other methods, such as rail or truck, but it would also be safer than other methods of transport, according to the President of the Consumer Energy Alliance, David Holt (NGP Photo), during a broadcast of Houston Public Radio.
“Pipelines are an order of magnitude safer and more environmentally responsible than any other mode of transportation for crude and natural gas. Whether or not we permit the Keystone pipeline, the crude oil in Canada is going to be produced. In the State Department’s own report, they said that without Keystone, the emissions impact to ship that [Alberta oil sands] to the east and the west, and to take it to China and elsewhere, could be a 600 percent increase in emissions,” Holt said.
New York Times: Cuomo Bans HF
Gov. Andrew M. Cuomo’s administration announced on Wednesday that it would ban hydraulic fracturing in New York State because of concerns over health risks, ending years of debate over a method of extracting natural gas.
Reuters: NY unlikely to face lawsuits over shale ban, experts say
When Governor Andrew Cuomo announced a ban on fracking in New York on Wednesday, he predicted "a ton of lawsuits" against the state. But that is unlikely as the end of a drilling boom has left the industry in no mood for a fight, industry experts and lawyers said.
Associated Press: McConnell Wants to Stop Coal Rules
Incoming Senate Majority Leader Mitch McConnell, R-Ky., pledged on Wednesday to do all he can to stop President Barack Obama's coal plant regulations, saying a White House "crusade" has devastated his state's economy.
SNL: House Republicans slam EPA carbon rule for existing plants as 'unrealistic'
The Republican majority on the U.S. House Energy and Commerce Committee contends the EPA's draft carbon dioxide regulation is illegal under the Clean Air Act and that the proposal's goals are "unrealistic."
Reuters: Chevron cancels Canadian Arctic drilling as oil prices slide
Chevron Corp is putting a plan to drill for oil in the Beaufort Sea in Canada's Arctic on hold indefinitely because of what it called "economic uncertainty in the industry" as oil prices fall.
Bloomberg: U.S. Talking Oil Exports Just When World Needs It Least
The U.S. Congress is talking about allowing unfettered oil exports for the first time in almost four decades. Its timing couldn’t be worse.
Bloomberg Businessweek: TransCanada’s Keystone Fight Turns to Exports on Oil Glut
Russ Girling’s Keystone XL saga is taking a new twist with a global glut of cheap oil. Americans, including President Barack Obama, are increasingly questioning whether the pipeline is needed or if it will just be a corridor for Canadian oil-sands crude to reach China. Girling’s answer is that the U.S. isn’t weaning itself off foreign oil anytime soon and that Gulf Coast refineries will be the buyers, not Asia.
The Denver Post: Tilting the Keystone
Being an ardent opponent of the Keystone XL project in rural Colorado isn't a popular position. The vision for this 21st century pipeline has been sold as a necessary component of our energy challenges and a massive job creator. Unfortunately, the pipeline is neither, and would be better characterized through the lens of American rural landscapes as an assault as opposed to an asset.
KMTV: Fight over Keystone XL continues, landowners vow to fight until very end
TransCanada has until mid January to acquire the land needed to build the Keystone XL Pipeline through Nebraska. A new offer from the company is on the table for landowners.
Fresno Bee: Plunging oil prices are good for us, bad for Putin
Plunging gas prices are a gift in more ways than one. They mean more cash in people’s pockets during the holiday shopping season, so hopefully local retail will get a boost. They will soften the blow next month for any price spike when fuels come under California’s cap-and-trade system to combat climate change.
CBS 4 News: Falling Gas Prices Could Harm Colorado’s O&G Industry
While prices at the pump are pleasing to many drivers so far this holiday season, the plummeting prices of oil are a bit concerning for Colorado’s oil and gas industry. Coloradans are paying an average of $2.52 per gallon. That’s 54 cents less than a year ago when it was $3.06. “Colorado has had a significant increase in production. At these prices I’m not sure that will continue,” said Stan Dempsey, president of the Colorado Petroleum Association.
Associated Press: Colorado drillers warn of closures with fines
Colorado oil and gas industry leaders say new fines for rule violations could lead in some cases to companies shutting down or curtailing operations. An attorney for the Colorado Oil and Gas Association industry group told regulators penalties should be waived for minor infractions.
News & Observer: NC Rules Review Commission approves HF standards
North Carolina’s proposed fracking safety standards sailed through a rules reviewWednesday despite a staff attorney’s warning that several rules failed to meet state standards and should be put out for public hearing. The Rules Review Commission’s approval means the fracking rules won’t be delayed by several months for extra reviews and hearings. Instead, the rules, written by the Mining and Energy Commission, are now headed to the state legislature, which is expected to lift North Carolina’s fracking moratorium in a matter of months.
Baltimore Sun: Shale ban in NY prompts calls for MD to follow suit
With New York's governor banning hydraulic fracturing for natural gas in that state, environmental groups are calling on Maryland's lawmakers to follow suit. New York Gov. Andrew Cuomo ended six years of study in that state and sided with his top advisers in deciding the potential environmental and health risks of "fracking," as it's commonly known, were too great to allow it to go forward there.
Lancaster Online: Home heating costs are down
Lancaster County residents should get some relief on their heating bills this season — unless there’s a repeat of last winter’s deep freeze. The administration estimated in its winter report on winter fuels that the decline in average price for some heating sources also will contribute to savings.
WOAI: Eagle Ford Production Strong--Won’t be Killed by Saudi Moves
The plummeting price of oil has not yet begun affecting drilling in the Eagle Ford shale south of San Antonio, an investigation by News Radio 1200 WOAI's Michael Board has concluded. Benchmark West Texas Crude fell nearly a dollar again on Tuesday to settle at $55.05 a barrel. That's down from $116 in April, and $110 as recently as June.
Dallas Morning News: Lawmaker files bill to discourage cities from passing HF bans
Rep. Phil King, R-Weatherford, proposed on Wednesday a bill that would require cities to make up for any revenue lost as a result of passing a municipal oil and gas ordinance–a requirement that could dissuade cash-strapped cities from considering or approving some local regulations.
Express-News: 500+ rigs may shut down as oil slides, analysts say
As many as 550 drilling rigs may have to sit on the sidelines of U.S. shale oil patches over the next few months, analysts say, as oil prices have folded nearly in half since this summer. The projections come a few days after Texas drilling rigs led the nation in a 1.4 percent weekly decline in the U.S. active rig count, according to oil-field services firm Baker Hughes.
Early Thursday News:
|This morning, we board our favorite airline, Alaska (NGP Photo, "Rockey Mountain High"), heading to Miami then on a wonderful partner airline (American) bound for writing and photography in Ecuador for a few weeks. Never fear, dear reader: every day we keep close in touch with goings on in the energy scene through our friends and associates from Inuvik to Calgary, Toronto, Washington, Houston, Williston, Juneau, Anchorage, Faribanks and Barrow...and beyond. You are our priority, and we'll keep you informed! -dh|
Juneau Empire by Matt Woolbright. Leaders from the private partners in the proposed Alaska LNG project urged lawmakers Tuesday to support the plan that they call a good business venture for everyone involved. ...
All those testifying pointed to the recently adopted Heads of Agreement document as an indicator that now is the time to press forward.
That document is “enabling unprecedented commercial alignment which is possible with the state’s participation” in the project, BP Exploration Alaska’s David Van Tuyl said.
Following up on Wednesday's report of the OCS Governors Coalition, here are other links:
The Washington Post
The Washington Post
Energy & Environment News
The News & Observer
Calgary Herald by Steve Ewart. David Collyer, president of the Canadian Association of Petroleum Producers, met the Herald's editorial board Monday and was called upon to defend "the industry" after three oil leaks in a month in Alberta raised public concern over the safety of aging pipeline infrastructure.
ADN by Lisa Demer. With little drama, the Kulluk -- a 29-year-old conical Arctic drilling rig that spent a dozen years mothballed in Canada -- launched for Dutch Harbor, a supply stop on the way to the far north, just before 8 a.m. Seattle time. The Noble Discoverer -- a 1960s-era vessel used as a log carrier before being converted for drilling -- was right behind, said Curtis Smith (NGP Photo), an Anchorage-based Shell spokesman in Seattle for the sendoff. Dozens of workers stood on the dock watching the ships they had rigged for Arctic work pull away. Seattle office workers had a view. "It's quite the on-water concert," Smith said. "There are lots of vessels maneuvering in well-planned and well-timed maneuvers." Four Shell vessels are part of Wednesday's flotilla. The U.S. Coast Guard is escorting the Shell ships as far as Port Angeles, Smith said.
CNN by Steve Hargreaves. The Obama administration will go ahead with more drilling in Arctic waters, though at a pace that allows for more research before additional permits are granted. The administration will hold new lease sales for oil companies to drill in the Chukchi and Beaufort Seas just north of Alaska, Interior Secretary Ken Salazar said Tuesday in a conference call with reporters.
Peninsula Clarion by Brian Smith. Two weeks ago, officials agreed to terms on the Tesoro refinery after a dispute about its value landed both sides in Board of Equalization hearings, Borough Assessor Tom Anderson said. The borough and Tesoro previously had a five-year agreement that went through 2010. During that period the highest value the refinery received was $182 million and the lowest was $126 million in 2010. In 2011, the borough hired an appraiser who valued the refinery at $303 million, which Tesoro disagreed with, Anderson said. Tesoro appeal the assessment and through its own appraisal determined the value at $128 million. The board of equalization decided to set the value at $143 million.
But that’s not the end of the issue. The plaintiffs in the case, which are heavy industries that include coal-burning utilities, will probably ratchet up the stakes by taking the case to the High Court -- a high risk gamble that would threaten to undermine their cause even more. That’s because the U.S. Supreme Court has already come down on the side of EPA here and it would likley uphold a key part of that undertaking, allowing the greenhouse gas rules to start up.
“The ruling will surely be appealed to the Supreme Court but it is not likely to rule prior to the election,” says Kenneth Reich, an environmental lawyer in Boston who was chief of environmental enforcement for U.S. Department of Justice. “Therefore, the political attacks on this administration’s approach to greenhouse gas regulation, using EPA rather than Congress to set the rules, will continue.”