Watching the Gas Bubble?

In recent months, it appears that top national media outlets have started to cast a more skeptical eye at how “abundant” shale gas really is.

The New York Times led the charge last year by analyzing “hundreds of industry e-mails and internal documents.” The Times concluded that shale gas has inherent risks, the geology varies, and that data is sparse. According to their report:

In the e-mails, energy executives, industry lawyers, state geologists and market analysts voice skepticism about lofty forecasts and question whether companies are intentionally, and even illegally, overstating the productivity of their wells and the size of their reserves. Many of these e-mails also suggest a view that is in stark contrast to more bullish public comments made by the industry, in much the same way that insiders have raised doubts about previous financial bubbles.

Despite attacks from the gas front group, Energy In Depth (EID), other outlets are beginning to confirm The New York Times original reporting. It’s far from clear that shale gas is magically “abundant.” Yesterday, Bloomberg reported similar conclusions in an article entitled, “Shale Bubble Inflates on Near-Record Prices”:

  • “Surging prices for oil and natural- gas shales…are raising concern of a bubble as valuations of drilling acreage approach the peak set before the collapse of Lehman Brothers.”
  • The “quirky nature of shale geology means the risks are high that an investment made in a sparsely drilled prospect will go bust.”
  • “[O]verseas investors are paying top dollar for fields where too few wells have been drilled to assess potential production.”
  • Hunt “has only drilled ‘a handful’ of wells in its Eagle Ford shale acreage, which means it doesn’t yet know how extensive or rich those holdings are.” The same problem exists in other shale formations around the country.

DeSmogBlog conducted a deeper comparison of the two reports showcasing the similarities between The New York Times and Bloomberg reports. It is clear now that EID lead mislead the public with unnecessary attacks on the Times’ Drilling Down series.

And, a new Reuters story quotes “public health professionals and advocates” arguing that the “public health effects of shale gas development need to be rigorously studied as production rapidly spreads in the United States.”

Here’s why this is important:  Without looking at the costs of contamination of public water supplies – as one industry study skipped altogether – it’s impossible to meaningfully evaluate the costs and benefits of shale gas. In other words, why talk about “abundance” without talking about cost?

Public health voice absent from fracking study

Shutting out public health perspectives is becoming common place, this time its being done by the federal government

On Monday the Secretary of Energy Advisory Board’s (SEAB) Natural Gas Subcommittee issued several recommendations to, “improve environmental safety and performance from extracting natural gas from shale formations.”

Initial reaction to the report is mixed and that’s no accident considering the split membership of the subcommittee. The seven-member committee is made up of scientists, researchers and experts who have ties to both the fossil fuel industry and the environmental community. But absent from the committee’s membership was someone from the public health community. This exclusion has become commonplace as communities from coast to coast try to get to the bottom of hydrofracking.

Click here to see those on the subcommittee.

This latest omission was pointed out during public conference call shortly after the report was issued.

“I find it very interesting that this report contained absolutely no input from medical professionals. But on page eight of your report it outlines that public health is one of the four areas that you are trying to address,” said one of the first callers on Monday.

Between other prepared statements from callers on both the pro-fracking and anti-fracking sides another citizen pointed to the absence of a focus on public health.

“We are concerned and I am concerned, as a health care professional, about the health impacts of this practice. Why would you let a practice like this continue without knowing what the chemicals can do once they are placed underground,” said Ernie Hernandez of West Virginia.

It seems public health is where the line is drawn when it comes to studying fracking. Earlier this year, Garfield County, Colorado, wrestled with this very same issue after elected officials refused to recognize a health impact study that the county directed $250,000 of taxpayer money towards.  The three members of the Garfield County Commissioners, who are heavily funded by the gas industry, unanimously pulled the plug on the report. The report’s findings were believed to be damning to the industry. The second draft of the executive summary stated, “The principal findings of the HIA are that health of Battlement Mesa residents will most likely be affected by chemical exposures, accidents/emergencies resulting from industry operations, and stress-related community changes.”

This was hardly the first time a professional assessment of the public health concerns associated with hydrofracking had come back to reflect poorly on the gas industry. Just before the Garfield County health scandal, Dr. Sandra Steingraber, a biologist, well-known author and Scholar in Residence at Ithaca College, reported that chemicals used in hydrofracking could be an “enormous” risk that could cause complications with pregnancies.

“Do we want introduce into the environment more chemicals for which we have demonstrable evidence can harm pregnancies. They are reproductive toxins,” said Steingraber in an interview with the Checks and Balances Project in May.

Despite these well-documented findings and reports, the Secretary of Energy Advisory Board’s Natural Gas Subcommittee contained no voices from the public health community. This isn’t to say the board’s recommendations were entirely beneficial to the gas industry. The board’s call for the industry to disclose the toxic chemicals it injects into the ground was received well by those in the environmental community. On Monday’s call the chairman of the Natural Gas Subcommittee John Duetch said, “while our recommendations were all unanimous, I think each member of the committee would have done it very differently it were up to the individual.” Even if there were true, it’s hard to imagine public health getting more attention considering the lack of representation.

Steve Pearce working hard for oil and gas companies

On Tuesday, Rep. Steve Pearce (R-NM) proved again that he’s one of the hardest working politicians on Capitol Hill when it comes to the oil & gas agenda. Rep. Pearce incorrectly claimed that wilderness protection is preventing the state from making money. Unfortunately for the congressman, New Mexico media reported just yesterday that the state is collecting record revenues from the oil and gas industry.

Rep. Pearce’s latest interesting interpretation of facts came during a House Natural Resources Committee meeting. The committee was debating GOP Whip Rep. Kevin McCarthy’s (R-Calif.) new legislation attacking wilderness study area designations. Republicans argue that protections for air, water and land block energy development and impede upon Big Oil profits.

Not surprisingly, Rep. Steve Pearce argued in favor of the legislation. He said New Mexicans couldn’t make money because of a lack of oil and gas production in protected areas.

Incidentally, Pearce has taken $1,280,901 in oil and gas campaign contributions over his career. Oil and gas companies have also invested $181,600 in McCarthy.

The Durango Herald reported that New Mexico’s government pulled in $17.2 million from drilling lease revenues in June, and $19.5 million in the first week of July.

Just as Big Oil is about to announce their second quarter profits, the oil-and-gas-funded politicians continue to try to secure more and more government handouts for this billion-dollar industry.

Rep. Pearce, how much will be enough for your oil and gas sponsors?

Connecting the dots between gas industry tycoons and the NAT GAS Act requires ink by the barrel load.

A recent investigation by DeSmogBlog and PRWatch exposes just who stands to benefit from the NAT GAS Act and the expensive tactics being used to ensure it flies through congress. The most recent tactic is a public relations campaign by Chesapeake Energy, which included the gas giant’s “Declaration of Energy Independence.”

Chesapeake Energy’s CEO, Aubrey McClendon, is joined by T. Boone Pickens, when it comes to who will benefit from NAT GAS Act. The legislation calls for the government to cut checks to any company that transfers its fleet of vehicles to methane gas and to have citizens shell out their taxes so that methane gas fueling stations can be constructed throughout the country.

According to the DeSmog report, Chesapeake, “will pour $150 million into Clean Energy Fuels Corporation (CEF). Energy tycoon and hedge fund manager T. Boone Pickens sits on CEF’s Board of Directors and owns a 41 percent stake, according to the company’s March, 2011 10-Q filing. That money will go toward funding methane gas fueling stations along federal highways spanning the country.

The timing of Chesapeake’s launch of the “Declaration of Energy Dependence” is no coincidence. The NAT GAS Act is at a critical stage. It currently has 183 co-sponsors, but it is also being considered at a time when the United States is trying to reduce handouts from America’s taxpayers. But with the help a public relations army that even includes a methane gas funded television network, McClendon and Pickens are betting they can buy another handout for the fossil fuel industry.

Five things to consider about the Yellowstone Pipeline leak

Nearly a week has passed and thousands of gallons of crude oil have poured into the Yellowstone River in Montana. The spill has placed attention on America’s often overlooked and aging pipeline system. As the media continues to cover ExxonMobil and its ruptured pipeline, here are a few things to consider about pipelines in the United States.

Leaky past

Over the last eighteen months the United States has seen a steady flow of pipeline accidents that have resulted in the spilling of millions of gallons of oil, the destruction of homes from coast to coast and several deaths and injuries. Between January 2010 and February 2011 nine major pipeline explosions resulted in 18 deaths, 13 injuries and 85 destroyed homes in the United States.

A full list of all pipeline accidents in the United States, including the Yellowstone River incident, can be found here. The list also includes the estimated 800,000 gallons of crude that spilled into the Kalamazoo River last year, as well as the 600,000 gallons of crude that made it into a Chicago suburb just months later. Both spills were the result of pipeline failures.

Regulating the flow

The management of pipelines is a bureaucratic nightmare. Six seemingly unrelated federal agencies, including the Department of Transportation, Mineral Services Management and U.S. Army Corp of Engineers, have a share in the responsibility as the Agencies of The Joint Pipeline Office dealing with concerns over safety, regulation, transportation and access of oil and gas from interstate pipelines. The agencies are responsible for thousands of miles of aging pipelines, some of which have been around since the 1860s. Yet, spills continue to happen causing leaks into our precious natural resources.

Exxon’s lies

In the wake of the Yellowstone River spill, ExxonMobil is increasingly going on the defensive for not telling the truth to federal officials and Montana Governor Brian Schweitzer. The Associated Press reports that an ExxonMobil said the oil spill had been contained within 30 minutes of the rupture. That reports shows that it was actually nearly an hour before the pipeline had been fully turned off. This was not the first discrepancy between ExxonMobil’s rhetoric and the reality of the Montana disaster.

Before giving federal officials and Schweitzer false information about how long crude flowed into the Yellowstone, ExxonMobil had been sticking to their story that ten miles of the Yellowstone River could be affected by the spill. By the time Schweitzer spoke on television on Tuesday night, the governor knew that the dynamics of the flowing Yellowstone River meant that ExxonMobil’s ten-mile claim was bogus. “At seven miles per hour, some oil is already in North Dakota. That’s a given,” Schweitzer said. That same day, the same transportation officials who were told that oil wouldn’t go beyond a ten-mile stretch, acknowledged that oil had been observed in Terry Montana, more than 240 miles downstream.

Keystone concerns

The Yellowstone River disaster comes at a critical time for America’s pipeline and energy industry. The Secretary of State’s office is currently considering approval for what would be a major pipeline that would connect crude oil reserves in the Alberta Tar Sands to refineries in the United States. This proposed expansion of the existing Keystone pipeline has raised concerns for several reasons. First, the pipelines will come close to existing waterways and aquifers. Modern pipelines can be buried as much as 25 feet beneath bodies of water; Exxon Mobil’s Silvertip line was 5 to 8 feet below the bottom of the Yellowstone. In Nebraska, several state legislators have expressed concerns that if a disaster like the spill in the Yellowstone River were to happen near the Oglala Aquifer, the damage done to a critical water supply to one of the nation’s leading agricultural states could be catastrophic. The same concern has been echoed by Nebraska’s two United States Senators who despite being members of different political parties, are both skeptical of the project’s potential harm to drinking water.

Of course this raises the question of the likelihood of spill from an expanded Keystone XL pipeline. According to a report by the National Resources Defense Council, spills from the existing Keystone XL pipeline occur at a rate of about one per month. Over the last eleven months eleven spills have occurred at pumping stations along the pipeline. This includes a May 7 spill of 500 barrels in North Dakota, which sent a geyser of oil spurting 60 feet into the air and shutdown the pipeline for a week.

Another reason for concern surrounding plans to expand the Keystone XL comes down to ties between Secretary of State Hillary Clinton and TransCanada. TransCanada is the company that owns the existing Keystone XL pipeline. TransCanada’s main Washington, DC lobbyist is Paul Elliot, who served as the Secretary of State’s national deputy director for her failed presidential run in 2008. This cozy relationship has resulted in several organization filing requests to see the discussions between Clinton and Elliot throughout this process. Currently, the Secretary of State’s office is in the review stages of the approval process for the pipeline, which if given the go-ahead would allow for 900,000 barrels of crude to be pumped into the United States every day.

Clean up costs

Not only does ExxonMobil make $5 million per hour, the company is a beneficiary of $21 billion in tax breaks (over the next five years) to the top five oil corporations.

Yet the “richest company in the world is using oil spill technology that is at least 40 years old,” said Eric Pica, president of Friends of the Earth during an appearance on MSNBC. ExxonMobil has not invested any funds into the ‘technological innovation’ of clean up equipment even though the Yellowstone Pipeline “has leaked at least 71 times on tribal lands, including one failure that resulted in a 163,000 gallon spill into a reservation creek.”

ExxonMobil will mostly be able to write off the clean up costs as a classic business deduction. Like Americans did during the BP spill (which reportedly cost $5 billion to clean up), they will accrue most of the financial costs of this leak. And who knows how much the tab will end up costing this time.

Nina Pierpont: Discredited Time and Time Again

Nina Pierpont is a pediatrician and an opponent of wind turbines. In a 2009 book she authored, Pierpont invented the term, “Wind Turbine Syndrome.”

Since then, Pierpont’s theories have been widely discredited by the scientific community, which points to severe flaws in her research methodology and lack of statistical validity, among other problems.

We pulled together the five major flaws in Pierpont’s theory about wind turbines:

Experts dispute the premise of Pierpont’s theory.

  • A panel of medical doctors, audiologists and acoustical professionals – including Dr. Robert J. McCunney of MIT – concluded, “There is no evidence that the sounds, nor the sub-audible vibrations, emitted by wind turbines have any direct adverse physiological effects on humans.“ (Expert Panel Review, 2009)

Pierpont used a sample size that was not valid.

  • Pierpont’s study included just 38 people in 5 counties who at some point lived near wind turbines. “[N]o conclusions on the health impact of wind turbines can be drawn from Pierpont’s work due to methodological limitations including small sample size, lack of exposure data, lack of controls and selection bias.” (Dr. Arlene King, Ontario Chief Medical Officer of Health, 2010)

Pierpont did not see her “subjects” in person nor did she medically examine them.

Pierpont’s work was not properly peer reviewed.

  • Pierpont’s work was never properly peer reviewed, as she claims. Instead, “she showed [her work] to people she selected and then published some of their responses, including that by Oxford University’s Lord Robert May, whose subsequent public silence on the issue may suggest a re-think.”Without proper peer review, it is difficult if not impossible to assess the validity of claimed scientific findings. (Australia’s National Health and Medical Research Council, 2010)

There were no recorded complaints from anyone else.

  • There is no record of complaints or symptoms of so-called “Wind Turbine Syndrome” from owners of the land on which the turbines actually sit. (TreeHugger, 2011)

From The Hill: Smart energy choices are the key to the future

[This op-ed was originally featured on The Hill.]
By Randy Udall

Americans love panaceas. We want thinner thighs in thirty days, a pill to cure baldness, an ultrasonic gizmo to double our mileage. Cheap gasoline isn’t guaranteed by the Constitution, but each time oil prices spike, politicians squirm as if it was.

Unfortunately, energy is an IQ test they tend to fail. For example, a recent bill introduced in the House of Representatives would require the Department of Defense to buy a $1 billion coal-to-liquids plant. If DOD is going to waterboard the climate, put Rumsfeld in charge.

Smart energy choices are the key to the future. With oil trading for $100, the biggest threat to middle-class prosperity is parked in the garage. U.S. fleet efficiency has barely budged since 1990, rising just 2 miles-per-gallon. With a typical family now spending one in every 11 dollars it earns on fuel, guzzlers are driving us to the poor house, tipping the economy towards a double-dip recession.

The same House bill hopes to jumpstart oil shale development. Oil shale is the world’s most misunderstood resource, the petroleum equivalent of fool’s gold. Although there are trillions of tons of it around the globe, oil shale currently provides only one-ten-thousandths of global energy, less than cow manure.

Oil shale has been “just around the corner” for a hundred years. A solid fuel, with just one-fourth the energy content of coal, it is much different than, but sometimes confused with, the shale gas and shale oil that are being produced in Texas, Pennsylvania, Arkansas, and elsewhere. Shale oil production in North Dakota alone is now about 25-times larger than global production of oil shale.

Half the world’s oil shale is in Colorado, Wyoming, and Utah, but locals are not holding our breath waiting for its arrival. Like a mirage on the highway, oil shale recedes as you approach it. When a barrel of oil was selling for $1, oil shale promoters said we’ll be ready when it hits $3. When petroleum was $10, oil shale would make sense at $30. It’s been “ten years away” for a century.

“Scientists forecast that within three years they can demonstrate a practical method of [oil shale] operation,” said one Kentucky newspaper in 1946.

Before too many years, oil shale will “undoubtedly” play an important role in meeting growing fuel demands, said a U.S. Department of Interior official in 1953.

“The oil shale reserves in Utah and Colorado are going to be a lifesaver,” said Reese Taylor, chairman of Union Oil Company in 1956.

Drill, baby, drill? We are drilling, like crazy. More than half the drilling rigs in the world are at work in North America. With oil exports peaking, we need to get real about energy conservation.

An aggressive national commitment to fuel efficiency-not the token on-again, off-again policies of the past—is not optional, it’s urgent and inevitable. With billions in taxpayer handouts and government support, oil shale might provide 100,000 barrels a day ten years from now, but that’s as much as we now consume every eight minutes. Increasing the woeful fuel efficiency of America’s automobiles by just two more miles per gallon would save twenty times as much fuel each year, saving consumers more than $50 billion at the pump.

A century of hype aside, oil shale seems destined to remain the poorest of the fossil fuels, containing far less energy per ton than hog manure, peat moss, household garbage, or Cap’n Crunch.

Randy Udall of Carbondale, Colorado is a consulting energy analyst and one of the nation’s leading activists in promoting energy sustainability. He is the former Director of the Community Office for Resource Efficiency (CORE) in western Colorado.

New white paper highlights a hundred years of quotes where industry, politicians hail new energy source

Oil Shale, a century-old science fiction story


Washington
The Checks and Balances Project today released an analysis of the rhetoric that politicians and oil industry executives have used over the last century to portray oil shale as a viable energy solution. This, in spite of the fact that the oil and gas industry has failed to produce oil shale commercially in the United States under either Republican or Democratic administrations.

“For the last century, politicians and oil industry executives have been telling the greatest science fiction story in America, that oil shale will soon save America from our energy woes,” said Matt Garrington, Deputy Director of the Checks and Balances Project. “Oil shale amounts to one hundred years of empty promises and failures. We need an honest debate on energy policy that looks at the reality and shortcomings of oil shale.”

In their memo entitled “Oil Shale: a century-old science fiction story,” the Checks and Balances Project used Google News Archives and LexisNexis to examine samples from a search turning up more than 84,000 news articles mentioning oil shale, beginning around 1910 and continuing to 1980. The data demonstrates that for the last century politicians and industry have described oil shale production as being “right around the corner” or even just a few years away from production.

In 1917, the Christian Science Monitor reported on the promise of oil shale and that “preparations are underway for the development of the fields this spring.”

In the 1920’s, when new oil shale deposits were being discovered in western states, a December 30, 1922 Berkeley Daily Gazette headline read, “Shale will supply oil to nation soon.”

The Kentucky New Era, in 1946 reported, “Scientists forecast that within three years they can demonstrate a practical method of [oil shale] operation.”

A century of research and billions of investment dollars later, oil shale remains elusive. But as oil prices spike, some politicians are still claiming the “rock that burns” is the answer.

At a March 17, 2011 hearing, House Natural Resources Committee Chairman Doc Hastings said, “The U.S. Geological Survey estimates [oil shale reserves] to be greater than one and a half trillion barrels of oil. The best way for the United States to insulate themselves long-term from unpredictable world events and rising gasoline prices is to produce more energy here at home.”

The Checks and Balance Project is calling on Hastings and other leaders to have an honest conversation about the viability of oil shale and acknowledge that it cannot address our current struggle with high gas prices.

[Download Full Report] [Contact] [Short Link: http://bit.ly/oilscific ]

Oil Shale, a century-old science fiction story

The shale covered a large area and the state oil experts declare that promised development of the deposits will mark a new era in oil production of the country.
– Pittsburgh Press, October 6, 1916

With Americans struggling to pay the high price at the pump, some elected officials, industry lobbyists, and oil and gas companies are pointing to oil shale as the answer to our nation’s energy issues.

They would have us believe the West sits on a sea of oil shale bigger than Saudi Arabia’s oil reserves that can be easily developed into petroleum to provide Americans with cheap energy for decades to come. The problem with that story is that it is pure science fiction. Oil and gas companies have failed to develop oil shale as a commercial energy resource in the U.S.  In fact, oil shale has been the fuel that is “just around the corner” for the last century.

The Checks and Balances Project used LexisNexis and Google News Archives to review oil shale coverage from 1910 through 1980. Our search turned up over 84,000 articles from U.S. newspapers. Many of the quotes in those articles are similar to what we hear from industry today. Oil shale is hailed as an energy boom and the next big thing in domestic fuel. When energy prices spike, politicians and energy industry representatives like to point at oil shale as a cure-all. Yet oil shale has still never been developed as a viable energy source.

[Download Full Report] [Contact]

Oil and gas spills has negative impact hunting and fishing recreation, local economies

On Thursday, the Bull Moose Sportsmen’s Alliance released a report that shows impacts of oil and gas spills on some of America’s most prized areas for hunting and fishing. Hunting and fishing has an enormous impact on the nation’s economy – more than $76 billion per year.

The report analyzed three Colorado counties, Ro Blanco, Mesa and Garfield, that sit in the Piceance Basin, an area with a high level of drilling activity and a popular spot for hunting and fishing.

Some key findings:

  • From 2001 to 2010, there were 992 oil and gas spills reported in the three-county region resulting in at 5.6 million gallons of wastewater, oil and other fluids being spilled into the local waterways.
  • About 91 percent of the oil and gas fluids spilled in the three counties from 2001 to 2010 was waste water, also known as produced water.  That water can contain salt, oil and grease, along with naturally occurring radioactive material and inorganic and organic compounds.
  • Equipment failure was the leading cause for spills in Garfield, Rio Blanco, and Mesa counties. At least 49 percent of the 992 spills were caused by faulty equipment.