Fairbanks News Miner, by Matt Buxton.  Things were quiet out at Flint Hills Resources’s North Pole refinery on Friday. There were crews cleaning and dismantling Crude Unit 2, the last refining unit to close in May, but gone is the loud buzz of crude being refined into gasoline and jet fuel.

Commentary: FACTA and Energy

(We invite readers to correct any misunderstanding we may have and offer additions/corrections.  We particularly invite comments regarding the effect of FACTA on energy companies/employees.  Comment here.)

It isn't an energy issue, but, yet it is: we believe the United States will be receiving more and more negative reactions to its implementation of FACTA on and after July 2.  

We won't bother to explain the Foreign Account Tax Compliance Act  (FACTA) to those unfamiliar with it here, but we highly recommend that all NGP readers review this one account of Canadian reaction, from today's CBC News correspondent, James Fitz-Morris.  

The United States can expect that this overreaching law will produce an equal and opposite reaction from countries everywhere, as we seek to impose duties on banks of other countries while reducing the freedom and privacy of American citizens.

If Canada reacts the way this article suggests, and if Canada is America's best friend and biggest trading partner, do we expect others involved in the use of American reserve currency dollars for facilitation of energy trading to be less offended and react with grace and forgiveness — or with retribution?  

Will America's perceived FATCA-arrogance affect the use of the US dollar as the world's reserve currency?  If the US dollar's reserve currency status is diminished, how will that affect interest paid on the national debt, inflation burdens born by citizens and energy prices calculated in dollars?

If countries begin retreating from US relationships, how will this affect the ability and/or cost of US based energy companies and employees to operate worldwide?  What about effects on US export trade?  Imported product pricing?  Tourism?  Airline and ground transportation industries?

Will this untimely implementation of a FATCA financial fuselage on banking institutions worldwide improve our national security?  Will it benefit our allies and soldiers in harms way from South Korea to the Middle East?

We hope Congress and the President have carefully considered their FATCA demands upon both American citizens and the financial institutions of the world.  If not, they should quickly reconsider.

What are FATCA's chances of achieving a positive result in the long run?  

In the short run, what are FACHA's chances of improving America's reputation, economy and national security?

We hope the geniuses whose hands are on the controls of our destiny have the answers and know where this financial adventure will take America and the rest of the world.

-dh

Today's Energy In Depth Links:

NATIONAL

Scientists study seismicity in Okla. CBS. Energy in Depth told CBS News that "the best science available to us right now suggests strongly that hydraulic fracturing has nothing at all to do with these small seismic events." Austin Holland of the Oklahoma Geological Survey has documented only a small percentage of recent quakes with a link to fracking. So far, he said he hasn't been able to conclusively link the quakes to fracking or wastewater injections.
 
Major production milestone hit in Texas. Forbes, EID’s David Blackmon. Oil drillers in Texas reached a new milestone in April, by producing more than 3 million barrels of crude oil every day (bpd) during the month of April, which is the highest daily oil output in the Lone Star State in any single month since at least January 1981, when the EIA started reporting each state’s monthly oil production (see chart above).

Cambridge Kiwanians hear update on oil and gas. Daily Jeffersonian (sub req’d). "Ohio has always been a prolific oil and gas producer," Shawn Bennett, Ohio director for Energy In Depth, told Cambridge Kiwanians recently.
 
Industry, environmentalists fight over record transparency. Akron Beacon Journal. Energy in Depth is at odds with Food & Water Watch over what was found in Ohio state records released by the Kasich administration. Click here to read EID’s post on the F&WW records request.
 
Natural Gas reduces carbon emissions. Fayetteville Observer, Column. While there is room for debate about the president's overall climate plan, it is clear that the cornerstone of American energy policy and climate action is the shale (fracking) revolution. Indeed, substitution of gas for coal has already reduced U.S. carbon emissions by 15 of the required 30 percent since 2005. No other country has made this type of progress.
 
Hydraulic fracturing is shrinking carbon dioxide emissions. Seattle Times, Column. The U.S. is leading the world in reducing its carbon dioxide emissions. And those reductions are largely due to the innovation that is happening not in green energy, but in the oil and gas sector’s ability to produce hydrocarbons from shale deposits.
 
Shale's debt could get shaky if Fed raises rates. Houston Chronicle. Corporate bond investors, eager to buy high-yield bonds from U.S. independent oil and gas producers, have tripled the sector's junk-rated debt (formally called speculative-grade) to $788 billion since the shale energy surge began seven years ago. But next year, the Federal Reserve may tap the brakes.
 
Complex condensate. Houston Chronicle, Editorial. Our nation needs more leaders who can explain the nuances and cost-benefit analysis of fracking in an atmosphere all too often defined in black and white. The House passed a good bill, and the fact that Houston's own made it happen was the cherry on top.
 
Working together on energy needs. Washington Post, Column.  Because of fracking, a method of extracting gas from shale rock formations, our region now gets most of its natural gas from neighboring states such as Pennsylvania and West Virginia, replacing supplies from the Gulf of Mexico.
 
US energy revolution will change life for the better. Albuquerque Journal, Op-Ed. Today, the nation is experiencing an energy renaissance that is helping American families by providing thousands of jobs and economic growth, lower energy costs and higher incomes. Energy production is one of our nation’s fastest-growing industries and an engine for economic growth in the U.S. for years – if not decades – to come.
 
GOP: Fueling the world. Washington Times. Sen. Lisa Murkowski is looking to help drive the natural gas export rush and maybe even turn some heads into considering shipping oil, despite pricing and environmental concerns.
 
Utility deals heating up with gas glut. Bloomberg. Electricity providers have attracted almost $50 billion in takeover offers this quarter, the most since the beginning of 2011, according to data compiled by Bloomberg. Cleco Corp., a $3.5 billion regulated power provider, this week became the latest utility to receive interest.
 
Half-Million Oil Barrels Bound for Export Erasing Glut. Bloomberg. As many as 500,000 barrels of light oil a day may be eligible for export under a new government classification, helping to soak up surging U.S. shale oil production.
 
Atop Sea of Oil in South Texas, Some Still Struggle. New York Times. The boom has both given and taken away. School officials bought 1,300 iPads, one for every student in the district. And there are jobs — well paid in the oil fields for some, marginal in fast food joints and cheap motels for others.
 
Abundant shale production also yields potential supply pinch for aromatics. Platts. The US petrochemical industry might be buzzing about all the cheap ethylene it can now make thanks to inexpensive ethane from shale gas plays. And while that certainly is helping position US polymer producers nicely in the global marketplace, there is another side to the shale coin.
 
Oil train dangers extend past Bakken region. Associated Press. The dangers posed by a spike in oil shipments by rail extend beyond crude from the booming Bakken region of the Northern Plains and include oil produced elsewhere in the U.S. and Canada, U.S. safety officials and lawmakers said.
 
INTERNATIONAL

Russia's quiet war against European HF. The Week Magazine. Russia is trying to maintain its energy stranglehold over Europe by backing movements across the continent to demonize fracking, the head of NATO alleged. It is part of Russia's broader use of soft power and covert means to complement its more overt efforts to reassert influence in Europe and keep countries there from developing alternatives to an energy addiction worth $100 million a day to Moscow.
 
Scotland shale reserves 'a fraction of those in northern England'. The Guardian. Shale gas reserves in Scotland are a fraction of those in northern England, according to a new study that will give a modest boost to backers of the energy source. NOTE: BBC News also reports.
 
Reassessing EU energy security. Cyprus Mail. The Russian Federation’s annexation of the Crimea has reawakened the spectre of EU energy security, bringing back memories of the 2006 and 2009 energy rows between Russia and the Ukraine.
 
Nova Scotia study looks at HF impacts. Cape Breton Post. A new study on the potential for hydraulic fracturing in Nova Scotia says there just isn’t enough research available to draw firm conclusions about the impact on communities.
 
COLORADO

Loveland vote shows Colorado is a model for energy dialogue. Denver Post, COGA.  It is healthy to question the safety, effectiveness and logistics of oil and gas development in your community. When taken too far and driven by fear, however, this investigation can foolishly ban production of an energy resource that we all use every day. Armed with the facts about responsible energy development, Loveland voters last week rejected the politics of fear and took a stand.
 
Fears surrounding Rocky Flats a foreshadow of hydraulic fracturing. Denver Post, Op-Ed. Today's energy debate about which regulations will protect people and property values vs. which are job killing, un-American tree-hugger boogey men. I'm suspicious that the energy companies and the local politicians know as little about that as the Department of Defense, DOE, Rockwell and Dow did about plutonium fires.

IDAHO

In Idaho, waiting on the natural gas industry. Idaho Statesman. The access road next to their potato field was widened properly, she said, and will be available for the Shueys' use. "It has been amazing," Shuey said. "The people have been wonderful." Trendwell West reported this week that it had found natural gas, but not enough to make the well economic. Still, the firm is not leaving Idaho.

ILLINOIS

Shale supporters frustrated with delays. The Southern. When Gov. Pat Quinn signed the Illinois Hydraulic Fracturing Regulatory Act into law June 17, 2013, Joe Bisch had high hopes for Grayville, the small southeastern Illinois town where he serves as mayor. “This time last year, I thought hydraulic fracturing would have come to Grayville by now, along with jobs, businesses, economic growth. I thought hydraulic fracturing would be lifting us up,” he said of the town and its citizens.
 
HF: Boom or Bomb. Quincy Journal. When Gov. Pat Quinn signed the Illinois Hydraulic Fracturing Regulatory Act into law June 17, 2013, Joe Bisch had high hopes for Grayville, the small southeastern Illinois town where he serves as mayor.

NORTHEAST
 
New York Court of Appeals upholds rights of towns to ban natural gas drilling. Post-Standard. New York's highest court has upheld the bans on natural gas drilling passed by two small Upstate towns. It is a major decision for the future of hydrofracking in New York state, where the drilling process has been on hold for more than five years. The decision allows towns to forbid fracking and other forms of gas drilling within their borders.
 
Lawmakers want more taxes for Marcellus. Herald-Standard. Local lawmakers said they support levying severance taxes on the Marcellus Shale natural gas industry though no official proposals have been presented in Harrisburg.
 
Study assesses health implications of HF in Maryland. Cumberland Times-News. Public health officials on Saturday unveiled a recently completed study that assesses health implications of hydraulic fracturing as the governor’s office plans to make a decision by the end of the year on the future of the practice in Maryland.
 
IT advances benefiting the energy industry. Watertown Daily Times, Op-Ed. Thanks to information technology, U.S. oil and natural gas production is experiencing an astounding boom.
 
Just say no to a severance tax – but not for the reasons you might think. Patriot-News, Op-Ed. Those seeking to protect Pennsylvanians from the environmental and public health dangers of hydraulic fracturing shouldn't be fooled by the appeal of higher taxes on the extreme drilling process.
 
Leasing headed over the top. The Review, Guest Column. Mineral rights owners, take note: if you leased your gas and oil rights a few years ago and drilling hasn't taken place, then it is possible for you to cash in a second time on your holdings, as many of the Marcellus Shale leases signed throughout northern West Virginia a few years back soon will expire without drilling taking place.
 
Santarsiero seeks to protect state lands from drilling. The Intelligencer. State Rep. Steve Santarsiero is proposing new restrictions on natural gas drilling on state lands to protect Pennsylvania’s natural resources.
 
Bill banning waste in NJ sent to Christie. Star-Ledger. A bill championed by environmentalists and lawmakers from both parties that would ban the dumping of hydraulic fracturing waste in New Jersey is now headed to Gov. Chris Christie's desk.
 
OHIO

Shale invigorating the US economy. Plain Dealer. In defense of shale development before a packed audience at the City Club of Cleveland, Thomas Farrell II, CEO of Dominion Resources, dismissed environmentalists, called wind and solar "niche players," and gave a full-throated argument that shale gas will not only make the nation energy independent but transform America into an "arsenal of energy."
 
Velocys buys Pinto Energy, companies working on Ohio gas-to-liquids plant. Crain’s Cleveland Business. Velocys, a Houston-based company that also has offices in Columbus, has acquired Houston-based Pinto Energy. The two are developing a $300 million plant in Ashtabula that will take natural gas from the Marcellus and Utica shale regions and convert it to diesel fuel.
 
Glitch sparks smoky fire at gas well. Columbus Dispatch. None of the 45 workers on site was hurt, state and oil-company officials said yesterday. One firefighter was treated for smoke inhalation. “All of the people are accounted for, and we’re not aware of any injuries reported. There probably are people being subject to examination, but it seems to be OK,” said Bjorn Otto Sverdrup, spokesman for Statoil North America, which operates the wells.
 
Norway's Statoil battling fire at Ohio well. Reuters. Norwegian energy firm Statoil is battling a fire at the Eisenbarth well pad in Monroe Country, Ohio, part of its shale gas operations in the Marcellus area, it said in a statement on Saturday. "There is a fire involving equipment on location," the firm said. "It is limited to surface equipment and does not involve the wells."
 
Fish kill might be linked to fire. Columbus Dispatch. The state is investigating a fish kill in an eastern Ohio creek near where a fire occurred at a shale-well hydraulic fracturing site on Saturday. The Ohio Department of Natural Resources learned yesterday of the fish kill in Possum Creek in Monroe County, said Jason Fallon, an agency spokesman. Fallon said he did not have details about the extent of the kill. “I can’t confirm if it’s related to the gas-well fire,” he said.
 
TEXAS

Feds target oil, gas industry pay. Longview News-Journal. . Andrea Johnson, a lawyer with Burleson LLP, a Houston firm specializing in energy, said the Fair Labor Standards Act is complicated and that when it comes to energy workers, many are well paid and might be exempt from overtime.
 
Crude Catering. Odessa American. More than 65 workers manned the well in Sallie 14-28H south of Odessa. There were the diesel suppliers, the wire-line contractors and the crew with Cudd Energy Services, among others who would develop the well in 42 stages to release the crude from shale rock. And then there were the three employees of Furr’s cafeteria. Because out on the oilpatch, the vendors and the vendors of vendors get hungry. This creates a niche that caterers increasingly seek to fill.
 
San Antonio energy tech company attracts high-profile investors. Houston Chronicle/Fuel Fix. Ed Whitacre, former chairman and CEO of AT&T and General Motors, has joined former Vice President Dick Cheney and Mexican billionaire Carlos Slim to invest in a San Antonio-based technology company that collects oil-field data.
 
Economic boom pounds Texas' roads. Standard-Producers. A Senate committee met last week and one expert talked about the conundrum of keeping up with transportation in Texas in general: Texas is booming, and that boom means a strain on roads, yet good roads are vital to a good economy.
 
Remaining poor while living atop a field of wealth. News-Journal. Texas has reaped tremendous financial benefits from oil and gas. But the poor in the colonias seldom own the leasing rights for the natural resources that lie under the ground they live on. One-third of Texas’ $48 billion in tax revenue last year came directly or indirectly from the oil and gas industry, said Bernard Weinstein of the Maguire Energy Institute at Southern Methodist University in Dallas.
 
The dark side of the ‘Texas Miracle’. Texas Tribune, Column. It’s hard to argue with the job creation numbers they tout. Since 2003, a third of the net new jobs created in the United States have been in Texas.