"For much of the state of Maine, the environment is the economy"
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2014 August 26
Maine officials seek to regroup to lower energy costs, and may have to consider what the state can do on its own.
A first-of-its kind effort by the six New England governors to expand natural gas pipeline capacity in the region has stalled and may be dead because of Massachusetts politics, dealing a blow to efforts to save Maine homes and businesses $120 million a year.
The plan, announced with great fanfare in January, would increase gas pipeline capacity by nearly 20 percent within three years and build at least one major electricity transmission line to bring renewable energy from Canada. Utility customers would be asked to help pay for the projects through electricity rates. The costs, though, would be recovered through savings on energy bills, according to advocates.
The plan hit a snag this month when the Massachusetts Legislature rejected a so-called clean energy bill presented by Gov. Deval Patrick. One part of that bill would have let utilities sign contracts for hydropower from Canada, a measure opposed by local power generators.
At the same time, growing public opposition to a new pipeline across northern Massachusetts has prompted Patrick and other influential politicians in the state to reconsider their support for the broader plan.
The Maine Public Utilities Commission is hearing a case to determine whether Maine and its power customers should help subsidize the regional effort, and to what degree. A decision could come in early fall, but the developments in Massachusetts may shift the discussion to what Maine can do on its own.
In a column last week in The Berkshire Eagle, [Democratic US Senator Elizabeth Warren of Massachusetts] wrote: “Before we sink more money in gas infrastructure, we have an obligation wherever possible to focus our investments on the clean technologies of the future – not the dirty fuels of the past – and to minimize the environmental impact of all our energy infrastructure projects.”
Spectra Energy’s Algonquin Incremental Market project … would boost gas volumes on an existing line through New York to Massachusetts without digging in a new corridor.
Maine should continue quest for low-cost gas, but also look to renewables and energy efficiency.
Maine is trying to better take advantage of the low [natural] gas prices and the efforts are good, but they shouldn’t be the state’s only response. We also should be working harder to diversify our energy mix with renewable sources, such as hydro, wind and solar and reducing demand through efficiency investments. These strategies are not only good for the environment, but they also reduce our reliance on a single energy source, making the state less vulnerable to price spikes.
One way to reduce the impact of high-cost electricity is to use less of it. Investing in efficiency works out to be about half as expensive as generating electricity. That makes it the cheapest power on the market. [Colored & bold emphasis added.]
Kinder Morgan is interested in building an additional natural gas pipeline from the New York border to Dracut, which would increase the gas supply, though some argue it would chain Massachusetts to fossil fuels and create environmental hazards along its path.
Gov. Deval Patrick raised the possibility of bringing electricity down from hydroelectric plants in Quebec, but legislation that would have enabled such a change in state energy policy fell short this summer. In the meantime, the state has alternative means to receive natural gas in the form of liquefied natural gas, or LNG, which arrives by tanker ships.
"We believe that we may get increased shipments of LNG, which is good for reliability, but will be costly," said Bartlett. [Colored & bold emphasis added.]
An August 6 court decision handed down by Calvert County Circuit Court Judge James Salmon could put Dominion Resources’ timeline for its proposed Cove Point liquefied natural gas (LNG) export facility in jeopardy.
Salmon ruled that an ordinance exempting the Lusby, Md.-based LNG project from local zoning laws — Ordinance 46-13 — violated both a section of a state Land Use law, as well as Maryland's constitution. The facility will be fueled by gas obtained via hydraulic fracturing (“fracking”).
“To my knowledge no other municipality or county in Maryland has attempted to do what the Calvert County Board of County Commissioners has attempted to do, i.e. completely exempt two uses from being covered by zoning regulations while requiring everyone else in the County to abide by those regulations,” wrote Salmon.
About 5,400 shale wells produced nearly 2 trillion cubic feet of gas during the first six months of the year, a 14 percent increase in production over the past six months of 2013, the data from the state Department of Environmental Protection show.
Energy companies accomplished the record despite connecting fewer than 500 new wells during the period. Previous semiannual reports showed an average of 675 new wells every six months.
LAKE CHARLES, La. (KPLC) - Federal officials are seeking public comment on plans by Kinder Morgan to funnel natural gas to Magnolia LNG's proposed liquid natural gas (LNG) plant in Lake Charles. The Federal Energy Regulatory Commission will take comments through September 10.
Hundreds of more trucks on A1A and Eighth Street headed to and from the Port of Fernandina. Railcars carrying liquid natural gas through downtown. Dozens of more ships bringing goods – and jobs – to Nassau County. What is the Port of Fernandina to do?
“... LNG export is well suited to the Port of Fernandina (for) delivery and distribution in the Caribbean market, which is undergoing a conversion away from diesel and gasoline,” the report stated. But “there will likely be blast zone security issues associated with the establishment of a bulk LNG commodity.” [Colored & bold emphasis added.]
Unlike the rest of the United States, energy consumption in island states and territories is almost entirely petroleum-based. These islands may soon be able to diversify their energy sources to include natural gas, because relatively low natural gas prices and new shipping technology may allow these islands to import liquefied natural gas (LNG).
Both Hawaii and Puerto Rico have diversified their electric generation mix with the addition of coal plants, and Puerto Rico has one independent power plant operating on natural gas, imported as LNG at a terminal adjacent to the plant. The Puerto Rico Electric Power Authority has also converted a nearby petroleum-fired generating station to use LNG imported to that terminal and is planning to convert a second petroleum-fired station if federal approvals are received for a separate floating off-shore LNG receiving terminal. But LNG has not been an option for most islands because it is typically shipped in bulk carriers in quantities far greater than many island economies could absorb. Furthermore, LNG requires expensive regasification and distribution infrastructure.
In Puerto Rico this fall, two privately owned bottling plants in the island’s industrial north will begin receiving containerized LNG shipments. The LNG will be procured through third-party suppliers from southeastern U.S. peak-shaving plants, shipped from Jacksonville, Florida.
Secretary of Energy Ernest Moniz is in Alaska this week. He says the Obama Administration wants to spur a project to export North Slope natural gas, and he says the No. 1 way his department can help is by staying out of the way.
Alaska’s oil producers applied to the Department of Energy last month for permits to export liquefied natural gas. The project will require an 800-mile pipeline, a liquefaction plant at Nikiski and other infrastructure. The companies haven’t committed to building the $50 billion system.
Proposals to export gas from the Lower 48 are controversial because of concern they will boost the domestic price of fuel. Moniz says the Administration has already decided the Alaska project will be exempt from requirements to show the price impact on domestic markets. [Colored & bold emphasis added.]
Webmaster's comment: Nevermind that exporting all that natural gas will increase greenhouse gas worldwide, plus the environmental impacts of an 800-mile pipeline.
Governor Sean Parnell issued a statement after the U.S. Department of Energy announced the Alaska LNG project is exempt from a new rule changing how the department handles LNG export permissions.
The exemption greatly streamlines the Alaska LNG project application.
Councillors in Squamish, B.C., have put off voting on a controversial call for referendum on a proposed $1.6 billion LNG facility in the city.
Instead, they are considering holding a town-hall meeting next month on Woodfibre LNG, a proposed LNG export facility that would operate from a former pulp mill site.
“Our government has been bullish in going after opportunities for liquefied natural gas and yet there’s this huge opportunity to be part of the big push towards solar right now. It just feels very wasteful and shortsighted,” [Ben West of ForestEthics] said.
[Dr. Martin Ordonez] calls B.C. an interesting case. He says companies are cashing in on solar energy by creating “technology innovation that’s not used here, but exported to other countries.”
The head of the Federal Energy Regulatory Commission last week defended the agency's refusal to analyze life-cycle greenhouse gas emissions from proposed gas pipelines and export infrastructure despite unrest among climate advocates.
Cheryl LaFleur, who is slated to serve as chairwoman through April 2015, said during an interview from her Washington, D.C., office that FERC doesn't believe it has the authority or should play the role under federal environmental laws of analyzing cradle-to-grave greenhouse gas emissions from proposed gas projects.
FERC had refused, in connection with permitting a new natural gas pipeline, to include a broader review of the impacts of natural gas production, including fracking of the Marcellus Shale. FERC's approach was upheld against a court challenge. Greenwire noted:
Environmental groups are pushing FERC and the Energy Department -- the two federal agencies that have a hand in approving a growing queue of LNG export projects -- to consider the broader effects of gas production and emissions. ...
The groups were emboldened by U.S. EPA's advice this year that FERC consider the life-cycle greenhouse gas emissions associated with Sempra Energy's pipeline and terminal expansion proposal in Louisiana, as well as how the export terminal would affect demand for gas extraction and the environmental effects of increased production.
That's the business-as-usual scenario under the current White House approach. [Colored & bold emphasis added.]
Every utility-scale installation during July came from the renewable sector. Two wind facilities were completed in Texas during July. New solar installations went online in Indiana, Maine, Vermont, and Maryland.
“This is not the first time in recent years that all new electrical generating capacity for a given month has come from renewable energy sources,” said Ken Bossong, Executive Director of the SUN DAY Campaign. “And it is likely to become an ever more frequent occurrence in the months and years ahead.” [Colored & bold emphasis added.]
The new report from the Taxpayers for Common Sense shows that oil companies paid just 11.7 percent of their U.S. income in federal taxes over the last five years, and the “smaller” companies included in the study that reported positive earnings only paid 3.7 percent. To achieve such a low tax rate, oil companies were able to take advantage of special tax breaks and loopholes that allowed them to defer more than $17 billion in taxes they would have otherwise owed.
We all know there is “energy fantasy” in Washington, D.C., which is partly due to the fact that fossil industries are huge political givers. According to PriceofOil.com:
- 2010 amount given to fossils in federal subsidies: $11,578,900,000
- Total amount given to fossils during 111th Congress: $20,489,340,000
A new report from the Sierra Club and Oil Change International found that the oil, natural gas and coal industries increased their political contributions by a jaw-dropping 11,761 percent from 2008 to 2012. [Colored & bold emphasis added.]
Webmaster's comment: Is it any wonder that FERC is regulation gone amok, and that Maine's federal delegation will not stand against state LNG projects?
…[A]s the president’s detractors and champions know all too well, some pretty significant environmental policy can be made directly by federal agencies. And on that front, the administration’s weak record speaks for itself.
But of the administration’s many climate sins—and there are many—one stands out in particular: ongoing tolerance, and even support, for hydraulic fracturing, or fracking, on public land. No other energy policy seems to so brashly defy climate science, popular will, and rudimentary political wisdom at the same time.
In 2010, as it became apparent the shale boom showed no signs of slowing, the Obama administration moved to introduce new rules for fracking on federal and Native American lands. (The rules were last changed in 1983, well before fracking became commonplace.) Now, nearly four years after its first public forum on the topic, the feds are on the verge of finalizing new regulations. And they’re pretty disappointing: highlights include such bare-bones measures as new well integrity reporting requirements and a loose chemical disclosure mandate based on a model bill from the Koch Brothers-backed American Legislative Exchange Council (ALEC). The rules will almost certainly not include an outright ban or moratorium on fracking.
Growing evidence has linked fracking to water contamination and an uptick in seismic activity near wells. (Last year, the fracking hotbed of Oklahoma had tremors 5,000 percent above the typical rate.) These risks alone should have led the federal government to outlaw the practice. But just in case the possibility of drilling-induced earthquakes in national parks isn’t alarming enough, one need only look at the impact on our climate.
When it comes to the future of the planet, swapping methane reliance for carbon addiction is like choosing the firing squad over the guillotine—it's better to steer clear of both options. [Colored & bold emphasis added.]
Natural Gas Highlights
Freeport LNG received authorization to construct and operate an LNG export terminal (1.8 Bcf/d) at Freeport LNG’s existing Quintana Island import terminal located near the city of Freeport, in Brazoria County, TX.
KM Louisiana requested authorization to construct and operate its Lake Charles Expansion Project which will provide 1,400 MMcf/d of north-to-south capacity for Magnolia LNG for its proposed export terminal near Lake Charles, LA.
Golden Pass LNG and Golden Pass Pipeline requested authorization to construct and operate an LNG export terminal (2.1 Bcf/d) at Golden Pass’s existing import terminal in Sabine Pass, TX., and pipeline facilities to provide 2,500 MMcf/d of bi-directional capacity on Golden Pass Pipeline’s existing system to serve the proposed terminal.
Columbia Gulf commenced the Commission’s pre-filing process to construct and operate its Cameron Access Project which will provide 800 MMcf/d of capacity to the proposed Cameron LNG export facility in Cameron Parish, LA. [Colored & bold emphasis added.]
2014 August 18
Mayflower LNG PTY Ltd. is taking over from Anadarko Global Holdings Company. The permit allowed the company to pour concrete for the storage tank foundations.
Mayflower is a subsidiary of Liquefied Natural Gas Ltd., which announced last month that it was buying the Bear Head site for $11 million. That deal is expected to close by Aug. 31.
The Aug. 6 BDN OpEd “Role reversal: How the Penobscot Nation is suing Maine – and has the upper hand” is reminiscent of the fear mongering that took place throughout the Indian land claims era (1970-1980) when the message was, “The Indians are going to steal your homes!”
The author, who happens to be the attorney representing the intervening towns and polluting industries in Penobscot Nation v. Mills, falls short in capturing the depth and complexity of this 194-year old history between the Penobscot Indians and the state government. Through the Maine Indian Land Claims, the tribes were seeking justice and restitution for territory that had been illegally taken from them as well as assurance that it would not happen again.
…The “agreement” has been broken since 1980. Perhaps this is why the 1980 Maine Indian Claims Settlement Act has been nicknamed the 1980 Attorney’s Employment Act. [Colored & bold emphasis added.]
Webmaster's comment: It is instructive to note that "the author" attorney mentioned in the above letter (Matthew Manahan of Pierce Atwood LLP) also represents Downeast LNG in claiming that the Passamaquoddy Tribe has no rights in the marine waterway; and thus, Downeast LNG will make no attempt to obtain a letter of agreement from the Passamaquoddy Tribe regarding use of the waterway — in spite of the US Coast Guard requirement to do so.
Downeast LNG is thumbing its nose specifically at the Passamaquoddy Tribe and the US Coast Guard, and at Environmental Justice in general.
[This article also appears under the New England heading, below.]
AUGUSTA, Maine — Gov. Paul LePage is pressuring Massachusetts Gov. Deval Patrick to show greater support for the expansion of natural gas infrastructure in New England, a project which all the other New England governors have supported.
Webmaster's comment: Or, New England could invest in renewable energy. Switching from one hydrocarbon fuel to another is not a solution to pollution or to climate change.
Jumping from the frying pan and into the fire is not helpful when it comes to meeting our region’s energy needs. In transitioning away from coal and oil, jumping head first into decades-long commitments to natural gas is proving to be both expensive and dangerous. The exuberance for natural gas is showing some telling tarnish.
Senator Elizabeth Warren recently penned a strongly worded opinion piece in the Berkshire Eagle, opposing a new pipeline planned to run through Western Massachusetts. She concluded:
"Before we sink more money in gas infrastructure, we have an obligation wherever possible to focus our investments on the clean technologies of the future — not the dirty fuels of the past — and to minimize the environmental impact of all our energy infrastructure projects. We can do better — and we should."
Our region has been leading in showing the nation how we can rely on cleaner and lower cost energy solutions from energy efficiency and renewable power. Billion dollar investments in new natural gas pipelines tie us to yesterday’s technology and growing pollution. We can and must do better. [Colored & bold emphasis added.]
[This article also appears under the Maine heading, above.]
AUGUSTA, Maine — Gov. Paul LePage is pressuring Massachusetts Gov. Deval Patrick to show greater support for the expansion of natural gas infrastructure in New England, a project which all the other New England governors have supported.
Webmaster's comment: Or, New England could invest in renewable energy. Switching from one hydrocarbon fuel to another is not a solution to pollution or to climate change.
A new report out today reveals natural gas drillers could be using diesel to frack wells without the mandated federal permits. Unlike other chemicals used in gas drilling, Congress requires extensive oversight if diesel is present.
The so-called Halliburton Loophole in the Energy Policy Act of 2005 exempts chemicals used in hydraulic fracturing from federal oversight. But diesel is an exception. That’s because it moves quickly through water, and even small amounts of the neurotoxins within the liquid fuel cause liver and kidney damage. [Colored & bold emphasis added.]
MOSS POINT, Mississippi -- The Federal Energy Regulatory Commission is planning a public scoping meeting tonight for the proposed Gulf LNG Liquefaction Co. project in Pascagoula.
The meeting is being held to identify and address the environmental impacts that could result from the construction and operation of an $8 billion project to add on to the existing liquefied natural gas storage terminal in Pascagoula.
The company has already begun its FERC pre-filing review process, which is meant to address any major issues before the application is filed.
Sierra Club continued to its voice opposition to exports of LNG by filing a protest with FERC against the proposed Golden Pass LNG export terminal near Sabine Pass, Texas. As in several previous protests against LNG export terminal projects which FERC found unpersuasive, Sierra Club argued, among other things, that the project is contrary to the public interest due to (1) the project’s negative impacts on air and water pollution and endangered species, and (2) the increased shale gas production and increased domestic gas prices that would be induced by LNG exports. [Colored & bold emphasis added.]
West Vancouver council was overly eager and at least a little confused in unanimously calling for a ban on liquefied natural gas tankers July 21, according to Mayor Michael Smith.
“We ultimately didn’t follow due process,” Cameron said, discussing the charged atmosphere in chambers that evening.
Council is slated to revisit the issue Sept. 8 or 15, following a presentation from Woodfibre LNG – the company seeking to liquefy and export 2.1 million tonnes of LNG per year by 2017.
COOS BAY — Veresen Inc., Jordan Cove's parent company, has been thrown into a legal scuffle with another company that says it has the right to a stake — up to 20 percent — in the liquefied natural gas export terminal.
EFG [Energy Fundamentals Group Inc.] says that in a June 27, 2005, letter agreement between itself and Fort Chicago Energy Partners LP (Veresen's predecessor), EFG was given the option to acquire up to 20 percent of Veresen's equity interest in the Jordan Cove liquefied natural gas terminal and its related assets.
U.S. Rep. Peter DeFazio, D-Ore., is slated to make a trip to Coos Bay Wednesday for his annual town hall meeting, where his website says he'll take questions on jobs and transportation legislation, the federal budget, Social Security, Medicare, port dredging and other issues.
But if a recent visit by Sen. Ron Wyden, D-Ore., is any indication, DeFazio will want to prepare his talking points on liquefied natural gas, and the proposed Jordan Cove Energy Project.
Wyden told a skeptical crowd last month that the federal regulatory process for Jordan Cove was being done right, and that "I am going to insist that the community be given answers to all legitimate questions."
DeFazio has been less visible on the LNG issue of late, though he tried to pass legislation in 2012 that would have eliminated the use of eminent domain for gas export projects to condemn private land for their pipelines.
At the time, DeFazio questioned how it was in the public interest to export gas and drive up prices, and said no one could credibly make that argument. [Colored & bold emphasis added.]
Webmaster's comment: If FERC has handled the Jordan Cove LNG permitting as they have handled Downeast LNG, Wyden could not be more wrong. As the record clearly shows, FERC wants to permit every LNG project, regarless of merits and flaws.
The U.S. Department of Energy (DOE) has released a final Addendum updating its May 2014 “Draft Addendum To Environmental Review Documents Concerning Exports Of Natural Gas From The United States.” The Addendum provides additional information on the potential environmental impacts of hydraulic fracturing and horizontal drilling activities gas production and exploration activities. DOE states that the Addendum is not required by the National Environmental Policy Act, but was prepared “to be responsive to the public and provide the most current information available.” DOE further states that the Addendum is largely based on the report Environmental Impacts of Unconventional Natural Gas Development and Production (May 29, 2014), prepared by the National Energy Technology Laboratory, a DOE Laboratory. [Colored & bold emphasis added.]
Beginning Thursday [Aug 14], the department will only issue final rulings on whether exports are in the public interest after the Federal Energy Regulatory Commission, or another authorized agency, has completed an environmental review of the project.
Oil and gas operations have historically been regulated mainly at the state level, though the expansion of hydraulic fracturing activities has brought with it an expansion in the number and sources of regulations facing operators. At the federal level, the US Environmental Protection Agency (EPA) has launched investigations into fracing activities in Wyoming, Texas, and Pennsylvania and is in the process of a multi-year study on the impact of hydraulic fracturing operations on drinking water, which will presumably set the stage for a new federal law. Meanwhile, at the local level, municipalities around the country have adopted limits or outright bans on fracturing operations that conflict with state rules.
The EPA's authority is currently limited by the existence of several exemptions for fracturing operations under federal environmental laws. Perhaps most importantly, hydraulic fracturing is exempt from regulation under the Safe Drinking Water Act (SDWA), provided diesel fuel is not used as an additive in fracturing fluids. Operating within the parameters of that exemption, the EPA issued guidance in February 2014 to states for when diesel fuel is used, describing how the states should regulate the limited number of such wells. But this federal restraint may be coming to an end. [Colored & bold emphasis added.]
Many aspects of an increased natural gas exports scenario would affect emissions. On the one hand, natural gas could partially displace the use of coal overseas in the generation of electricity. This would put downward pressure on emissions, as natural gas plants on average emit approximately 50 percent less carbon dioxide, or CO2, than coal plants.
On the other hand, methane, which is a potent, short-lived greenhouse gas with many times the warming potential of CO2, escapes into the atmosphere from leaks and intentional venting throughout the natural gas supply chain. Although cost-effective technologies exist that minimize the escape of methane, there is evidence that current levels of methane emissions can be high. Recent studies of air samples collected over natural gas production sites in the western United States reveal leakage rates of 4 percent at the Denver-Julesburg Basin and 6.2 percent to 11.7 percent at the Uinta Basin. [Colored & bold emphasis added.]
2014 August 12
An Australian company is acquiring a mothballed liquefied natural gas (LNG) project on Cape Breton Island, Nova Scotia, which includes an industrial-zoned site with project rights, approvals, storage tank foundations and civil works.
Sampson made this comment after Liquefied Natural Gas Limited (LNGL) of Australia announced its intention to acquire Bear Head LNG Corporation from a subsidiary of Anadarko Petroleum Corporation for US$11 million.
LNGL is planning to integrate Bear Head project's existing civil works and detailed engineering work with the development, technical and engineering work already completed for the US$2.2 billion Magnolia LNG Project near Lake Charles, La.x
There are two other LNG export sites proposed for Nova Scotia's eastern coast. [Colored & bold emphasis added.]
Five LNG export projects — all in varying stages of development — are being planned for Canada’s Atlantic coast. It is likely all would need natural gas from the Marcellus play to meet international demand.
Houston-based Spectra Energy announced earlier this year its desire to reverse the flow of the Maritimes and Northeast Pipeline, built in 1999 to move gas south from Nova Scotia Sable Island fields. But with abundant supply in the Marcellus play and increasing demand in the northeastern United States, Spectra wants to start sending gas from the U.S. north.
The Goldboro LNG export project in Nova Scotia [Pieriday Energy] is working its way through the regulatory obstacle course. But if all goes to plan, the terminal could start pulling anywhere from 300 million cubic feet to 500 million cubic feet of Marcellus gas each day, said Mark Brown, director of project development for Pieridae Energy, a Calgary-based infrastructure development company that has proposed the export terminal.
The Canaport LNG import facility in Saint John, New Brunswick, was identified by Canadian provincial governments as a prime candidate for Canada’s foray into the overseas export market. But despite reported interest from Spanish energy company Repson [sic; Repsol], which owns 75 percent of the operation, to invest $2 billion to install export terminals, no firm plans have been announced.
Indian company H-Energy has announced plans for a $3 billion export terminal in Melford, Nova Scotia, north of the Goldboro LNG project in the same county. H-Energy already has memorandums of understanding for half of its 1.8 Bcf/d export capacity and plans to be in operation by 2020. But the plan is still conceptual, and H-Energy has two years before it has to decide whether to go ahead with the project, according to Halifax, Novia Scotia, newspaper The Chronicle Herald.
Calgary-based Husky Energy is also exploring an LNG export project, the size and scope of which is to be determined.
Last month, Liquefied Natural Gas Ltd., based in Perth, Australia, acquired the site of a previously proposed LNG import facility in Nova Scotia for $11 million and announced plans to build an export terminal [Bear Head LNG]. That facility would ship the equivalent of 0.5 Bcf/d. The company said the facility would have the ability to expand. [Colored & bold emphasis added.]
Opponents of a plan to build a $3.8 billion liquefaction unit at a Lusby gas plant are declaring a significant victory after a Circuit Court judge ruled the Calvert County Commissioners violated the state constitution last October with their approval of a zoning ordinance amendment.
Judge Salmon concluded that the ordinance in which the county cedes zoning oversight of liquefaction facilities to federal officials “violates the uniformity provision as set forth in the land use article” and “constitutes a special law that violates the provisions of the Maryland Constitution.” [Colored & bold emphasis added.]
Natural gas production in the Marcellus region exceeded 15 billion cubic feet per day (Bcf/d) through July, the first time ever recorded, according to EIA’s latest drilling productivity report.
The Marcellus region, mostly located in West Virginia and Pennsylvania, is the largest producing shale gas basin in the United States, accounting for almost 40% of U.S. shale gas production. Marcellus region production has increased dramatically over the past four years, increasing from 2 Bcf/d in 2010 to its current level.
The rig count in the Marcellus region has remained steady at around 100 rigs over the past 10 months. Given the continued improvement in drilling productivity, which EIA measures as new-well production per rig, EIA expects natural gas production in the Marcellus region to continue to grow. With 100 rigs in operation and with each rig supporting more than 6 million cubic feet per day in new-well production each month, new Marcellus region wells coming online in August are expected to deliver over 600 million cubic feet per day (MMcf/d) of additional production. This production from new wells is more than enough to offset the anticipated drop in production that results from existing well decline rates, increasing the production rate by 247 MMcf/d.
Florida is home to the Everglades and the Big Cypress National Preserve, two locations that have a unique climate, assortment of wildlife, and diversity of fauna. Drilling has occurred in Southwest Florida since the 1940s,2 but it has been contained to traditional vertical drilling, until recently. The transition to more extreme methods of extraction, such as acid or hydraulic fracturing, may have more severe consequences on the fragile environment. The current rules and regulations in place are specific to vertical drilling, not focused on the distinct risks of fracking.
Environmental justice can be a challenge that accompanies oil and gas drilling at times, defined as the inequitable distributions of environmental burdens. In Florida, we see a potential example of environmental justice, as the drilling completed thus far has dominantly affected low-income communities such as Collier County. Collier County has a large proportion of older, retired families, as well as younger families that may hold multiple jobs and relatively low incomes. In these communities, people are less resistant to the introduction of large, new industries that promise economic growth, since opportunities for such economic stimulation are rare. Similarly, people are less resistant to these issues simply because they may not have enough influence or understanding to reject such risky industries. It is clear then, that impoverished or under-stimulated communities often have to deal with the repercussions – environmentally, economically, and socially – of industry presence more than in places where people can afford and know how to repel industries that may pose environmental risks. [Colored & bold emphasis added.]
The $1.1 billion plant -- two huge holding tanks on a spit of land south of Pascagoula -- was built more than three years ago to import the gas that is chilled to a liquid. But the tables have turned and the part owners, El Paso Pipeline and Kinder Morgan, are waiting their turn for federal blessing to reconfigure Gulf LNG and begin exporting to non-Free Trade Agreement countries, which includes the crucial Asia markets and the United Kingdom. [Colored emphasis added.]
Webmaster's comment: The "tables turned" even before Gulf LNG construction was completed. At the import terminal's ribbon cutting in 2011 — even though it was already clear that the terminal would not be needed — Gov. Haley Barbour announced how 'the terminal would provide badly-needed low-cost natural gas to the United States.' Since its commissioning in 2011, Gulf LNG has never received an LNG cargo other than required for commissioning the terminal. Now, they're running late in another fool's rush to export.
Excelerate Energy, in cooperation with the Puerto Rico Electric Power Authority (PREPA), has received the draft Environmental Impact Statement (EIS) from the Federal Energy Regulatory Commission (FERC) for its proposed Aguirre Offshore Gasport Project (AOGP).
The AOGP is a proposed floating LNG marine terminal, located offshore Puerto Rico.
“Inuit need to remain the deciders as to whether or not any extraction will happen"
As two Canadian icebreakers travel north on a survey mission to bolster the federal government’s claim to Arctic offshore resources, Inuit leader Terry Audla has a message: “Inuit need to remain the deciders as to whether or not any extraction will happen… there’s a need for a lot more consultation and information and knowledge-sharing.”
As for the need for consultation and Inuit involvement in UNLCOS, Audla pointed out that the National Energy Board’s decision in June to grant a five-year permit for seismic testing in Baffin Bay near Clyde River didn’t include adequate consultation, Audla said.
“The NEB had mistakenly tried to open the Baffin Bay area without having thoroughly consulted with the Inuit of the area,” he said.
Despite [Woodfibre LNG vice-president of corporate affairs Byng Giraud's] enthusiasm for the site located seven kilometres southwest of Squamish, Mr. Giraud acknowledges that Woodfibre LNG is entering troubled waters. Environmentalists and other activists are stepping up their protests, against a backdrop of LNG cheerleading from the B.C. government.
Woodfibre LNG is bracing for a rough patch as it edges closer to making a final investment decision by mid-2015 on whether to proceed. Other B.C. LNG proposals won’t be getting a free ride either, judging by mounting opposition to Woodfibre LNG in Squamish and nearby communities such as Lions Bay and West Vancouver.
Tracey Saxby, co-founder of anti-LNG group My Sea to Sky, says the picturesque Squamish region needs to play up its strengths in Howe Sound tourism and outdoor recreation. She warns there will be negative impacts to Mill Creek and a nearby salmon stream, and no amount of improvements will ever persuade My Sea to Sky members to support LNG exports because the global drawbacks such as climate change far outweigh the local economic benefits.
While the provincial government is optimistic about the private sector running five LNG projects eventually [15 projects are being proposed], there is no guarantee that even one will be built. [Colored & bold emphasis added.]
Just 14 months ago, British Columbia Premier Christy Clark and Alberta Premier Alison Redford were riding high, and vowing to resolve their differences over proposed new oil pipelines to the west coast.
Although Clark once promised that the first of 15 proposed LNG projects on B.C.’s north coast — namely the Kitimat LNG project, backed by energy giants Apache and Chevron — would be operational by 2015, that looks like little more than a pipe dream now. [Colored & bold emphasis added.]
The Portland Tribune reports that the U.S. Ninth Circuit Court of Appeals has dismissed Columbia Riverkeeper et al.’s appeal of the U.S. Coast Guard’s issuance of letter of recommendation (LOR) that approved transportation of LNG on the Columbia River. According to the report, the petitioners claimed that the Coast Guard failed to comply with the National Environmental Policy Act and the Endangered Species Act by not waiting for environmental assessments. The Court’s opinion states that the appeal is part of an effort to prevent construction of the Oregon LNG terminal along the Columbia River in Oregon. In its opinion, the Court ruled that the LOR was not a final agency decision and therefore, the Court lacked jurisdiction to hear the appeal. [Colored & bold emphasis added.]
Webmaster's comment: This decision reflects similarly on the Downeast LNG US Coast Guard's LOR that was not preceeded with NEPA (National Environmental Policy Act) compliance.
The website FracFocus.org was built to give the public answers to a burning question about the shale boom: what exactly were companies pumping down tens of thousands of wells to release oil and gas?
With funding from industry trade groups, FracFocus launched in April 2011 as an optional disclosure tool. More than 200 operators voluntarily uploaded their fracking fluid recipes for each well – with the exception of those ingredients companies deemed “trade secrets.”
One year later, the voluntary disclosure site started to become a required regulatory tool in several states, including Pennsylvania.
[I]nformation about tens of thousands of wells is technically available to the public on FracFocus, “but in such an obscure, obtuse way that it’s impossible to look at it in aggregate.”
FracFocus has come under new scrutiny as the U.S. Bureau of Land Management considers whether to use it as a disclosure tool for fracking on federal and Indian lands.
In a 2013 report, [Harvard Law School Environmental Policy Initiative director Kate Konschnik] gave FracFocus a failing grade as a disclosure tool. She found that the data were often inaccurate or incomplete, and that companies were making “trade secret” claims for chemicals at one well site while fully disclosing the same chemicals at another. [Colored & bold emphasis added.]
Webmaster's comment: A separate cooperative effort between SkyTruth and FrackTracker is attempting to compile data from FracFocus, and make that data public, but FracFocus currently makes that effort impossible.
Study after study has shown that exporting any amount of LNG from the U.S. will raise the domestic cost of natural gas on homes and businesses. APGA believes that consumers should not be subjected to high energy prices and price volatility. The extreme weather during the winter of 2014 illustrated the crucial need to keep U.S. energy resources available and affordable for U.S. citizens. If all facilities were constructed, daily domestic production of natural gas would have to increase by 55 percent in order to meet export demands and keep natural gas prices at their current levels. [Colored & bold emphasis added.]
…On the one hand, natural gas could partially displace the use of coal overseas in the generation of electricity. This would put downward pressure on emissions, as natural gas plants on average emit approximately 50 percent less carbon dioxide, or CO2, than coal plants.
On the other hand, methane, which is a potent, short-lived greenhouse gas with many times the warming potential of CO2, escapes into the atmosphere from leaks and intentional venting throughout the natural gas supply chain. Although cost-effective technologies exist that minimize the escape of methane, there is evidence that current levels of methane emissions can be high. Recent studies of air samples collected over natural gas production sites in the western United States reveal leakage rates of 4 percent at the Denver-Julesburg Basin and 6.2 percent to 11.7 percent at the Uinta Basin.
Other aspects of the natural gas trade further complicate the climate effect of exports. For example, the physical process of transporting natural gas carries a sizable emissions penalty. Natural gas destined for overseas ports is liquefied, shipped, and later re-gasified. Each stage of the exports process results in greenhouse gas emissions. A recent analysis from the National Energy Technology Laboratory estimates that liquefaction, shipping, and re-gasification account for approximately 17 percent of total emissions associated with liquefied natural gas, or LNG, exports when the destination is Europe, and 21 percent of total emissions when the destination is Asia. [Colored & bold emphasis added.]
2014 August 11
Today, FERC approved Downeast LNG’s request to begin the pre-filing environmental review process for its proposed bidirectional LNG import-export terminal and interconnected pipeline near Robbinston, Maine. Downeast LNG states that it is planning to convert its proposed LNG import terminal and sendout pipeline into a bidirectional import-export LNG terminal and pipeline, which could process approximately 450 MMcf/day of natural gas and export approximately 3 million metric tonnes per annum. [Colored & bold emphasis added.]
The Penobscot Indian Nation [invited] the public to a hearing [on August 6] to provide input on proposed new water quality standards for tribal waters. It's the first time the tribe has ever petitioned the federal Environmental Protection Agency for such standards. Thee move has raised concerns from the state of Maine, which is embroiled in a lawsuit against the EPA over its handling of water quality issues on Indian territory.
In a private agreement between the Penobscot Nation and the EPA signed in 1999, the two parties outlined a process and goal of building trust, respecting Sovereignty of the Nation and putting a high priority on "tribal cultural concerns such as subsistence needs...and uses of natural resources" in EPA decision-making. Both parties also agreed to keep their communications confidential to the greatest extent possible.
Webmaster's comment: This may have implications on Passamaquoddy Tribal rights in the marine waterway.
The Doric Victory, a huge transport ship the length of two football fields, just sailed 4,000 miles to deliver over 40,000 tons of Russian coal to the Schiller Station coal-fired power plant in New Hampshire.
This sounds crazy. America has more coal than Russia. More than anyone else in the world. In addition, the recent closings of many of our coal plants to meet long-term carbon goals certainly have freed up U.S. coal supplies. In 2012, America retired 10 GW of coal-fired capacity. Besides, haven’t we just slapped Russia with more sanctions?
Webmaster's comment: And not too long ago the US exported gasoline — because there was too much of it! Does the energy industry rule, or what?
The staff of the Federal Energy Regulatory Commission (FERC or Commission) has prepared a draft environmental impact statement (EIS) for the Algonquin Incremental Market Project (Project), proposed by Algonquin Gas Transmission, LLC (Algonquin).
The Project’s proposed aboveground facilities consist of modifications to six existing compressor stations, to add a total 81,620 horsepower, in New York, Connecticut, and Rhode Island and abandonment of four existing compressor units for a total of 10,800 horsepower at one compressor station in New York. Algonquin would also modify 24 existing meter and regulating stations, construct 3 new meter and regulation stations, and remove 1 meter station in New York, Connecticut, and Massachusetts. The Project would provide firm transportation service of 342,000 dekatherms per day of natural gas to local distribution companies and municipal utilities in Connecticut, Rhode Island, and Massachusetts. [Colored & bold emphasis added.]
After it recently sent a letter of concern regarding Freeport LNG environmental impact, EPA’s region 6 office in Dallas, voiced more concern to the FERC regarding two other LNG export terminal projects in Texas.
EPA requested the U.S. Federal Energy Regulatory Comission to further examine the environmental impact of Corpus Christi LNG and Cameron LNG, stating that the recent environmental reviews were inadequate. [Colored & bold emphasis added.]
Webmaster's comment: The seriously-flawed FERC Downeast LNG final EIS should also be the subject of EPA concerns.
In comments filed at FERC recently, the U.S. Environmental Protection Agency Region 6 office in Dallas, Texas (EPA) has voiced concerns that FERC’s environmental review of several LNG export terminals proposed for construction in Texas has been inadequate. In FERC dockets regarding LNG export terminal proposals by Corpus Christi LNG, Freeport LNG and Cameron LNG, EPA requested that FERC, in its environmental review of the projects, (1) address whether there are disproportionate effects on majority minority or lower income communities and proposed mitigation measures; and (2) consider in its decision making recent U.S. Department of Energy reports on induced gas production and greenhouse gas emissions resulting from increased gas exports. EPA also requested further review of wetlands disturbance and cumulative impacts from the projects. [Colored & bold emphasis added.]
“Earlier today, I submitted my letter of resignation from the Federal Energy Regulatory Commission to President Obama. It has been a great honor to serve with all the exceptional professionals and public servants who make up the FERC family and so many dedicated energy stakeholders in the public and private sectors. I want to say a special thank you to the incredible personal staff I have had throughout my tenure on the Commission. I have a tremendous opportunity to continue in public service as the Minister-Counselor for the U.S. Department of Agriculture in Rome, Italy. My resignation will take effect on Wednesday, August 20, 2014.” [Colored & bold emphasis added.]
2014 August 4
An investigation by the Pittsburgh Post-Gazette found Marcellus Shale drillers didn’t report half of spills that led to fines.
…what is surprising — to politicians, environmental groups, the industry itself and state officials — was the number of spills that were not first spotted by the drillers themselves. About a third were first identified by state inspectors while others, about one-sixth, were discovered by residents, according to the Post-Gazette’s analysis.
State law requires reportable spills to be called into state environmental regulators within two hours. [Colored & bold emphasis added.]
Webmaster's comment: Self-regulation leads to abuse.
2014 August 9
According to the Penobscot Nation, the settlement acts, from both state and federal law, apparently didn’t settle either the boundaries of its reservation or what or whom it can regulate. The Penobscots now claim their reservation includes at least the entire 60-mile Main Stem of the Penobscot River, from Indian Island northward to Medway, and claim they can regulate Indian and non-Indian use of the river and many of its tributaries and branches. The Penobscot Nation is pursuing this position through a lawsuit pending against the state of Maine in federal court and in water quality standards the Penobscot Nation has proposed for those waterways.
According to the Penobscots, the settlement didn’t settle things after all. [Colored & bold emphasis added.]
Webmaster's comment: This op-ed piece was authored by Matt Manahan, the lawyer and lawfirm representing Downeast LNG, also representing municipalities against Maine tribes' legal claims. It is especially interesting that he filed recently to the FERC docket on behalf of Downeast LNG, claiming that the Passamaquoddy Tribe has no rights in the marine waterway — but in his op-ed, he indicates that the matter is not as clear cut as he presented to FERC.
Manahan complains that the Penobscot Tribe (and, by extension, Passamaquoddy Tribe) has the upper hand, that non-Indians are at a disadvantage, that roles have been reversed from the historic injustices and tragedies of the past. And yet, Manahan faults the tribes.
New England power generators need to lock into more natural gas pipeline capacity to avoid a supply squeeze and record prices seen last winter, Spectra Energy Corp.’s chief executive officer said Wednesday.
Houston-based Spectra, which operates about 22,000 miles of pipelines, said after quarterly earnings issued Wednesday that it committed $2 billion to six pipeline projects during the second quarter.
“I believe, particularly in New England, you will see the need for power generators to own some amount of capacity. And the way that’s done is to sign up for a certain amount of capacity for a full 365 days, which is no different than local distribution company contracts,” Ebel told Reuters.
2014 August 3
Questions about conflict of interest in Nova Scotia.
A Maritime university charged with conducting an independent and public review of hydraulic fracturing in Nova Scotia is closely tied to a company that trains oil and gas workers for Exxon Mobil, a key promoter of hydraulic fracturing and one of the world's largest energy companies.
And David Wheeler, chair of Nova Scotia Hydraulic Fracturing Review Panel, also serves as the unpaid director and chair of that company.
Last year the Nova Scotia Department of Energy commissioned the Verschuren Centre for Sustainability in Energy and the Environment at Cape Breton University to hold an independent review on the social, economic, environmental, and health implications of hydraulic fracturing.
Although the Nova Scotia Hydraulic Fracturing Review Panel describes David Wheeler as the president and vice-chancellor of Cape Breton University, it makes no mention of his public responsibilities with LearnCorp International. Nor does it disclose that the university owns a firm training workers for Liquified Natural Gas (LNG) terminals.
Freeport is the third U.S. LNG export project to get the green light to begin construction from the Federal Energy Regulatory Commission.
FERC approved construction of Sempra Energy's Cameron LNG export terminal in Louisiana last month.
Companies need approval from both the Energy Department, which determines whether the proposed exports would be in the public interest, and FERC, which assesses safety and environmental effects of the projects' construction and operation.
The next LNG export project likely to receive approval from FERC is Dominion Resources Inc's Cove Point facility in Maryland.
Webmaster's comment: FERC has never met an LNG terminal project it doesn't like.
CALGARY - A liquefied natural gas project planned for Kitimat, B.C., faces an uncertain future after one of its U.S. partners announced plans to get out of the LNG business.
Apache Corp. said Thursday it plans to ditch the Kitimat LNG project, which it was developing alongside Chevron Corp., as well as the Wheatstone LNG project in Australia.
…Chevron and Apache have not had an easy time securing buyers for the resource, said Ed Kallio, director of gas consulting at Ziff Energy, a division of Solomon Associates
President Barack Obama has named Cheryl A. LaFleur to serve as Chairman of the Federal Energy Regulatory Commission, effective July 30, 2014, and designated Norman C. Bay Chairman effective April 15, 2015. [Colored & bold emphasis added.]
Webmaster's comment: Norman Bay was recently confirmed by the Senate to serve as a FERC Commissioner.
The Tightrope Walk of Doom
During the most recent winter season in Asia, LNG prices topped $20 per million British thermal units (mmbtu), causing suppliers to salivate at the prospects for the rest of the year.
Fast forward to today, though, and prices have sunk to $10 per mmbtu. That’s a 50% haircut, thanks to slack demand during the summer and new facilities coming on line.
Now traders are parking LNG on tankers, sitting idle at ports in the hope of a rebound in prices.
What U.S. investors are failing to realize is that LNG is already up and running in the rest of the world – and pricing trends are pointing lower over time, not higher.
Making matters worse, the trend is towards more LNG production in the coming years, not less. Exxon Mobil, for instance, just started up a new LNG facility in Papua, New Guinea – which will further add to supply.
It’s the spot market that should really worry investors in LNG companies.
The thinking that LNG is somehow less vulnerable to price shocks than any other commodity is misplaced, and uncertainty will be part and parcel of this “new” market, as well.
Webmaster's comment: Downeast LNG is again several years behind the market curve, chasing expired realities.
Holistic evaluation of impacts needed
In areas where shale-drilling/hydraulic fracturing is heavy, a dense web of roads, pipelines and well pads turn continuous forests and grasslands into fragmented islands. Photo courtesy Simon Fraser University PAMR.
FRISCO —Fracking battles often develop over neighborhood concerns about pollution, but that local focus may mean that we’re losing sight of the bigger picture. On a landscape level, the current and projected scale of shale gas exploitation poses a huge threat to ecosystems, as each individual well contributes to air, water, noise and light pollution.
Those impacts need to be examined on a cumulative level, scientists said in a new study that calls for scientists, industry representatives and policymakers to collaborate closely on minimizing damage to the natural world from shale gas development.
The findings, co-authored by researchers from around the world, are published in the journal Frontiers in Ecology and the Environment.
Some key findings from the research:
- Determining the environmental impact of chemical contamination from spills, well-casing failure and other accidents associated with shale gas production must become a top priority. Shale-drilling operations for oil and natural gas have increased by more than 700 percent in the United States since 2007 and Western Canada is undergoing a similar shale gas production boom. But the industry’s effects on nature and wildlife are not well understood. Accurate data on the release of fracturing chemicals into the environment needs to be gathered before understanding can improve.
- The lack of accessible and reliable information on spills, wastewater disposal and fracturing fluids is greatly impeding improved understanding. This study identifies that only five of 24 American states with active shale gas reservoirs maintain public records of spills and accidents. [Colored & bold emphasis added.]
Albert Einstein is rumored to have said that one cannot solve a problem with the same thinking that led to it. Yet this is precisely what we are now trying to do with climate change policy. The Obama administration, the U.S. Environmental Protection Agency (EPA), many environmental groups, and the oil and gas industry all tell us that the way to solve the problem created by fossil fuels is with more fossils fuels. We can do this, they claim, by using more natural gas, which is touted as a “clean” fuel—even a “green” fuel.
Like most misleading arguments, this one starts from a kernel of truth. That truth is basic chemistry: when you burn natural gas, the amount of carbon dioxide (CO2) produced is, other things being equal, much less than when you burn an equivalent amount of coal or oil. It can be as much as 50 percent less compared with coal, and 20 percent to 30 percent less compared with diesel fuel, gasoline, or home heating oil. When it comes to a greenhouse gas (GHG) heading for the atmosphere, that’s a substantial difference. It means that if you replace oil or coal with gas without otherwise increasing your energy usage, you can significantly reduce your short-term carbon footprint.
Interestingly, there’s little evidence that fracked wells leak more than conventional wells. From a greenhouse gas perspective, the problem with fracking lies in the huge number of wells being drilled. According to the U.S. Energy Information Administration, there were 342,000 gas wells in the U.S. in 2000; by 2010, there were more than 510,000, and nearly all of this increase was driven by shale-gas development—that is, by fracking. This represents a huge increase in the potential pathways for methane leakage directly into the atmosphere. (It also represents a huge increase in potential sources of groundwater contamination, but that’s a subject for another post).
…economists have long argued that a paradox of energy efficiency is this: if people save energy through efficiency and their energy bills start to fall, they may begin to use more energy in other ways. So while their bills stay the same, usage may actually rise. … In this way, consumers can actually end up using more energy overall and so emissions continue to rise.
All of the available scientific evidence suggests that greenhouse gas emissions must peak relatively soon and then fall dramatically over the next 50 years, if not sooner, if we are to avoid the most damaging and disruptive aspects of climate change. Yet we are building, or contemplating building, pipelines and export facilities that will contribute to increased fossil fuel use around the globe, ensuring further increases in emissions during the crucial period when they need to be dramatically decreasing.