This is from Michael Economides - the foremost energy economist and energy pragmatist. He does not mince words and people should listen. The piece highlights the fact that "green-energy" and "feel good energy policy" is the opiate for the rich dumbass, not the working American or the out of work American. While at first glance it may seem to put all our eggs in the hydrocarbon basket, he calls for the United States to use all energy resources available to it. He also calls for undivided attention to pollution abatement and control, not attention to the CO2 Boogeyman.

Has American Energy Policy Killed a Green Scene? Survey says yes.

Posted 4/8/2010 4:37 PM CDT

A new Gallup poll released today found that Americans now prioritize energy production over environmental protection for the first time in its 10-year history. The survey showed that a solid 50% of Americans want to develop US energy resources even if doing so will lead to environmental “suffering” of some kind. (That marks a 16 point increase from just three years ago.)

Public opinion has been trending in this direction for quite some time; in fact, a similar Gallup study done in March showed that Americans would risk environmental protection for more secure economic growth. Combined, these two polls demonstrate that the public is losing faith in Washington’s energy policy.

As “green” energy rhetoric has increased, so too have energy costs – leading the average consumer to realize that the only green element of current US policy is the money being wasted on feel good energy policies. The Obama Administration and those in the environmental community should heed this movement. Energy demand is a concrete reality, not just a public perception that can be solved through clever marketing. Americans need, and clearly want, national energy policies that tangibly enhance our energy security by pursuing all available sources of energy. That means greater access to and increased use of traditional energy resources, not policies that impose costly command-and-control regulation on the use of fossil fuels, or nuclear power, or whatever energy source happens to be out of style in Washington that week.

It’s no surprise that this important shift comes just a week after President Obama’s announcement that claimed to expand access to the plentiful oil and gas resources that lie off U.S. coasts. As I’ve noted before, the administration’s plan, while theoretically allowing some access, offers none of the guarantees of long term development that would make investment in domestic resources financially feasible or make a difference to consumers’ pocketbooks. Gallup’s new findings suggest that the American public was not fooled by this insubstantial, political offering.

It may end up being the ultimate irony but not really unexpected. Much of the clamor in recent years about anthropogenic global warming, the outrageous claims about its consequences by Al Gore and the UN’s IPCC, the talk about cap and trade at a time of dire economic needs and the bona fide nonsense of the Waxman-Markey bill have worked in unison to dig a huge credibility gap. We may be witnessing a phase where the American public is ready to throw away the baby with the bath water. And that would be a pity because real pollution and not CO2 emissions still need our undivided attention.

As far as energy supply we have innovative technology at our disposal from space age technology for offshore production to exploiting America’s vast shale gas resources, to increase the nation’s domestic supply of affordable energy, and we have the experience to do so in an environmentally responsible manner. Now it’s time for government policies that promote and encourage action.

OPEC will step in if oil price hits 100 dollars: Kuwait

OPEC will step in if oil price hits 100 dollars: Kuwait

Don't make too much of this. I'm not a market expert but its going to be a little while before oil hits $100. Won't be a long while, but it will be a little bit. Also, Kuwait is just one nation in a cartel of more than a dozen nations. It remains to be seen if other OPEC members would be on board with this proposal.

Technology responds to regulation and economics

The oil and gas industry is the model for ingenuity and industrial creativity. I'm pretty confident that given time, the industry will eventually be able to pull oil and gas out of the sky. Of course, that is hyperbole but you get the analogy. Technology has opened up new reserves and will continue to open up new reserves and perhaps give life to wells and fields that were thought long dead.

Now, the downside to this is that regulations are always outpaced by technology and the regulations that do come up to respond to technology are usually reactionary and ill-conceived (see FRAC Act). That does not mean the regulations do not become effective. When they do, industry hems and haws about the regulations but after the belly-aching, industry evolves. Industry evolves faster than regulation and industry learns to work with the regulations, utilizing technology and creativity to tap reserves safely.

More information on oil and gas shale: "a whole new paradigm for the US E&P business

Oil and gas shale development did not take off because of higher oil and gas prices. Shale production took off because of advances in horizontal drilling and increased drilling efficiencies combined with prolific production rates, making a lot of the shale plays economic to produce at almost any price. Its likely that natural gas prices will continue to fall but there will still be a lot of shale drilling, a new trend that the traditional exploration and production sector has never seen. Hence "a whole new paradigm."

This is from the Billings Gazette in Wyoming.

"CASPER — State regulators will take more time to consider several proposed rule changes for the oil and gas industry, including more stringent reporting requirements regarding chemicals used in hydraulic fracturing.

Members of the Wyoming Oil and Gas Conservation Commission, which includes Gov. Dave Freudenthal, indicated that while they want the new reporting requirements to be user-friendly for the industry, the industry is unlikely to escape more stringent requirements altogether.

“There’s got to be something that allows us to say we have carefully evaluated this activity,” Freudenthal said.

It’s unlikely there will be another public hearing on the matter, according to the commission.

After hearing three hours of testimony Tuesday morning in Casper, the commission said it would leave the matter open for 15 days and possibly schedule some type of work session to go over the draft rule changes with the commission’s staff.

The commission will likely make a final decision on the rules in June.

“I think we could continue this process for months and months trying to make this thing perfect, and I don’t think it would serve us well because we’d have people come in and try to do this for us,” said commissioner Bruce Williams.

National concerns

Hydraulic fracturing — or “fracking” — is the practice of pressurizing a mixture of sand and various fluids to fracture gas-bearing rock deep underground, creating pathways for the gas to flow toward a well bore.

Increasingly sophisticated fracking and horizontal drilling technologies are credited with unlocking about 100 years worth of new reserves in recent years, according to the industry.

But as the practice has become more widespread, it has also come under more scrutiny from environmental and public health advocates. They say there’s not enough information about the fluids being pumped underground and not enough assurances that chemicals in the fluids are not getting into drinking water sources.

In response, the U.S. Environmental Protection Agency in March launched a new research effort to investigate the potential adverse impacts of hydraulic fracturing on water quality and public health.

Reporting requirements

The practice is overseen by state-level regulators. And that’s just where industry and the state of Wyoming want the regulatory oversight to remain.

But Freudenthal said he doesn’t believe the state collects enough information from the industry about the fracking fluids to be able to tell the EPA what’s being pumped into Wyoming’s underground.

“I know you’re here to stiff-arm us,” Freudenthal told an attorney representing Halliburton. “But I’m not sure what we have is sufficient enough to look them (EPA) in the eyes and say we’re doing it right.”

According to Halliburton attorney Thomas Jackson, regulators already have access to the main chemical constituents through Material Safety Data Sheets — which are a common requirement in the workplace and list chemicals that employees and others may handle.

However, if a fluid mixture contains any carcinogens at levels of less than 1 percent, those carcinogens do not have to be listed in the MSDS.

Jackson said Wyoming’s proposed rule changes would require industry to report even those chemicals not listed in MSDS — and that would reveal enough information to compromise what Halliburton considers its proprietary formulas used in hydraulic fracturing.

Having to report every single chemical constituent to the commission would actually work as a disincentive for Halliburton to make the most effective products for the industry, Jackson said.

“There really is no demonstrated need for having this information reported on a routine basis,” Jackson said.

Jackson said that while the practice of hydraulic fracturing is not a threat to human health and the environment, Halliburton is concerned that if the state does collect a complete list of chemicals, human error among regulators may threaten the proprietary nature of its fracking formulas.

“We’re dealing with human beings, mistakes can happen,” Jackson said.

Shared burdens

In August 2006, drillers experienced a blow-out on a natural gas well near the town of Clark. There are now at least two plumes of contamination from oil and gas activity in the area.

Clark area resident Deb Thomas, representing the Powder River Basin Resource Council, said any further disclosure and access to information on chemicals used in the oil and gas industry is vital to people who live near the activity.

“If casings are bad, then everything that goes down that well can contaminate water zones,” Thomas said.

In addition, all of those chemicals are first transported on public roadways and stored in various areas in higher concentrations before they are injected into gas wells for fracking. Thomas said the general public needs full disclosure of those chemicals in case there are accidents on the surface.

The EPA is studying whether fracking has contaminated water wells in the Pavillion area in central Wyoming.

Pavillion area landowner John Fenton said his family’s land is ringed with past and current oil and gas activity. He said the full disclosure of all the chemicals the industry uses is vital to protecting Wyoming’s other natural resources.

In response to industry comments that reporting more information about fracking would be cumbersome and expensive, Fenton said the industry is sometimes cumbersome and expensive for some landowners.

“I believe myself and my family have been burdened, too,” Fenton said. “We received a 50 percent reduction in the assessed valuation of our home due to the gas activity near our home. So we’ve made our sacrifice.”"

This is good stuff. If industry is concerned about federal intervention, then industry needs to get comfortable with greater state intervention and oversight. As an ardent anti-federalist when it comes to federal oversight of drilling programs, states do have an interest in greater oversight of hydraulic fracturing. While there has been no reported case of freshwater contamination from hydraulic fracturing operations with the exception of above ground fluid spills by some idiotic operators in Dimock, PA, that does not mean states should not keep an eye on it. Complacency breeds ignorance and ignorance breeds horrible accidents. By taking a careful, thoughtful approach to writing new hydraulic fracturing rules, states are doing something the EPA is not in the position to do - effectively regulate.

Wind Energy - Blowing your mind one turbine at a time

Wind, it cooks your dinner.

Midwest turns to wind turbines

By JENNIFER A. DLOUHY Copyright 2010 Houston Chronicle

April 8, 2010

The wind-energy industry last year installed 5,700 new turbines with more than 10,000 megawatts of generating capacity — enough to serve more than 2.4 million homes — said the American Wind Energy Association.

Texas leads the nation with more than 9,000 megawatts of wind generation capacity, including 2,292 megawatts added last year. But Iowa is the leader in relying on wind-generated electricity. Last year, 14.2 percent of the state's electrical power came from wind — compared to 1.8 percent nationwide.

Indiana added 905 megawatts of capacity in 2009, second only to Texas. Measured by total installed capacity, the top states are Texas, Iowa, California, Washington and Oregon.

The data from AWEA reveals another year of continued growth for wind power. But industry leaders said they are constrained by the nation's aging electrical transmission system and that sustained growth depends on the continuation of expiring federal tax credits as well as a new national requirement that power companies must get a portion of their electricity from renewable sources.

“What we have to do is get these policies in place that really provide that long-term commitment, so we can have that exponential growth,” said Denise Bode, AWEA's CEO.

In Great Plains, Pacific

Renewable electricity standards mandate the use of wind, solar and other easily replenished power sources in 39 countries and 29 states, including Texas and California. There is no similar nationwide mandate, though proposals for a federal requirement are pending in Congress.

A national renewable electricity requirement could steer utilities away from some lower-cost energy sources and encourage investment in wind and solar power.

Although an increasing number of states are adding wind power to their energy portfolios, turbines remain concentrated in the Great Plains and along the Pacific Coast. The industry has not secured a foothold in the Southeast, where less gusty conditions make the power source less attractive.

Abilene is tops

The nation's six largest wind farms are in Texas, with the biggest — the Roscoe Wind Farm near Abilene — boasting 782 megawatts of generating capacity.

Bode stressed that wind power projects are spurring domestic manufacturing and said the industry supported 85,000 U.S. jobs in 2009. “We're really one of the only bright spots out there in terms of growing the U.S. manufacturing sector,” he said.

Not everyone is as enthusiastic. Natural gas producers worry that fossil fuel will be displaced if utilities are forced to shift to renewable sources. James Mulva, the CEO of ConocoPhillips, told the U.S. Energy Association on Wednesday that mandated use of renewables for electricity generation “could prove pretty expensive” by unfairly giving an advantage to energy sources, even though they have a higher price tag.

Map of Current CO2 Pipelines

Here is a map of current CO2 pipelines, courtesy of Marston Law:

http://www.marstonlaw.com/index_files/CO2%20Pipeline%20Map.pdf

What Wes is doing in energy today

So, I'm in Minneapolis. Why? Well, because I'm helping write the wrap-up report for a project for the Department of Energy. The project is focused on the development of a CO2 capture, storage, and transportation legal and regulatory infrastructure. We're focusing on economic issues, transportation issues, and potential regulatory frameworks. One of the key issues is who regulates this? There are strong cases to be made for the EPA (it is a "greenhouse gas" under the Clean Air Act) or an energy regulatory agency (FERC, CFTC, etc.) The clearest potential regulator right now is the EPA. However, there is an even stronger gas to be made for a sort of "dual-regulation" meaning regulation by different agencies. Under "dual-regulation" there is the inherent recognition of the value of CO2 as a commodity (for EOR) as well as something that could potentially pollute if mismanaged.

We're also looking at state regulations and have found that states are already taking a sort of "dual-regulation" approach by regulating CCS through their oil and gas regulatory agencies and their environmental management departments. Like types of energy and environmental regulation, the states are leading the the federal government.

This is from a blogger in upstate New York. Sums up how the urban east coast could potentially lose out on the shale gas boom by being hung-up on an environmental threat that does not exist except in movies like "Gas Land" and "Split Estate" and in the minds of legislators and regulators who could not regulate/legislate themselves out of a paper-bag.

"For as long as I can remember, upstate has taken a backseat to the interests of downstate. New Yorkers are being asked to wait to drill for natural gas in the Marcellus Shale until the U.S. Environmental Protection Agency completes yet another study analyzing the safety of hydraulic fracturing.

We have already waited two years while the state has studied the environmental impacts and worked on revising drilling regulations. We have a virtual Saudi Arabia of energy underneath our feet and farms. The world has been safely developing natural gas for more than 100 years. The EPA, as recently as 2004, determined that hydraulic fracturing is safe, and Pennsylvania has been safely drilling the same Marcellus Shale for more than two years and has experienced billions of dollars in economic impact and thousands of jobs. Despite this success, upstate New Yorkers are being asked to wait.

We can wait until all of the fifth-generation farmers lose their land to investors who do not care about the upstate way of life due to jacked-up tax assessments and depressed agricultural prices. Wait until Pennsylvania fills the pipelines to the brim, rendering our natural gas unneeded. Wait until all of the energy companies and second-tier businesses throw in the towel and move operations permanently to Pennsylvania.

Without any credible evidence of harmful effects — from federal agencies such as the EPA, from private industry, from environmental organizations, from local and state government — the state imposed a moratorium on developing privately owned land using a tried and true, safe technology.

Think of the benefits of burning New York's own natural gas to run city buses and heat the apartment buildings of Manhattan. Think of the environmental benefits of using a fuel that is twice as clean as coal. Think of the tens of thousands of jobs that would become available and the long list of unemployed that gas exploration could relieve. How would dozens of thousands of jobs within commuting distance suit downstate's pocketbook?

The natural gas industry has one of the best safety records of any industry in the world. There are currently 498,000 natural gas wells being drilled in the U.S. today, and the state's water is completely unrelated to developing the Marcellus Shale, which exists 6,000 feet below the water supply.

The 70,000 members of the coalition of which I am a member are farmers, stonecutters, environmentalists, hunters and business owners. We live and love the land. None of us would risk our legacy for any industry or energy source. But it is time to put the myths, misinformation, extremist language and fear away. It is time to save New York. We cannot wait."

Chris Oliver of Bainbridge is a chiropractor, a landowner and a member of the Central New York Landowners Coaltion.

So, what is a shale formation? Shale is a type of rock housing oil and natural gas deposits. Over the last few years, there has been expansive growth is production from shale resources. Once thought to be cost prohibitive to produce, with the run-up in oil and gas prices in 2008, shale development really took off.

Shale oil and gas is produced through horizontal drilling and hydraulic fracturing. Horizontal drilling is just like the name sounds - a drilling rig is put into place and a well bore is initially drilled vertically only to make a gradual horizontal turn. Hydraulic fracturing is a completion technique where a mixture of mostly sand and water and some emulsifiers are injected into the well bore at high pressure, causing the shale formation to break apart, releasing the oil and gas trapped in the shale reservoir. Horizontal drilling and hydraulic fracturing has opened up "shale plays" that were once thought all but closed off due to economic reasons. That is no longer the case though. Horizontal drilling and hydraulic fracturing have allowed for production from a single well bore that previously would have required multiple well bores, thereby decreasing significantly the environmental footprint of drilling and exploration operations.

Further, horizontal drilling and hydraulic fracturing have made the United States and international player in energy. Russia was formerly the worlds leading holder of natural gas reserves but with "shale plays" coming on-line across the United States, the United States now holds the largest reserve of natural gas in the world. Suck it, Commrade.

I've been meaning to start a blog for a long time now. The only problem with starting the blog was what to blog about. So I came to the conclusion that I would blog about energy. Primarily looking at oil and gas issues but since I am a strong proponent of a balanced energy portfolio, other energy sources will be discussed too.