Monday, November 14, 2011

Barker's Newsbites: Monday, November 14, 2011


Do ya remember this one...?!
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6 comments:

William R. Barker said...

http://www.nationalreview.com/articles/282610/paul-krugman-s-solar-eclipse-robert-bryce

Over the past 60 years, the process of hydraulic fracturing has been used more than 1 million times on oil and gas wells here in the U.S.

Over the past year or so, NYT journalist Ian Urbina has been writing extensively about the oil-and-gas sector and fracturing in particular. Urbina has spent months, some of it working with the Environmental Working Group, to document cases of water wells that have been contaminated by fracturing. Urbina’s finding: One water well in West Virginia was likely contaminated by fracturing in 1984.

(After laying out the details of the contamination, Urbina writes, "The report concluded that hydraulic fracturing fluids or gel used by the Kaiser Exploration and Mining Company contaminated a well roughly 600 feet away on the property of James Parsons in Jackson County, W.Va.; Eric Wohlschlegel, a spokesman for the American Petroleum Institute, emphasized that the important factor was that the driller and the regulator had not known about the nearby aquifer.)

[A] multi-year study on natural gas released last summer by the MIT Energy Initiative note, “The fracturing process itself poses minimal risk to the shallow groundwater zones that may exist in the upper portion of the wellbore. ... The physical realities of the fracturing process, combined with the lack of reports from the many wells to date of fracture fluid contamination of groundwater, supports the assertion that fracturing itself does not create environmental concerns.”

* MEANING NOT THAT YOU CAN'T HAVE PROBLEMS - SEE THE ABOVE PARSONS CASE - BUT THAT IN TERMS OF BASIC COST/BENEFIT ANALYSIS FRACKING IS GENERALLY "SAFE" IN COMMON PARLANCE... i.e. THE PROCESS ITSELF DOES NOT CREATE ENVIRONMENTAL CONCERNS.

Hydraulic fracturing is driving down the cost of natural gas, which creates jobs in other sectors, including steel and petrochemicals. From 2005 to 2008, U.S. natural-gas prices averaged about $7 per thousand cubic feet, but today, the spot price is well below $4; the price drop saves consumers about $60 billion per year.

Over the past 18 months or so, some 48,000 people have been hired in Pennsylvania by companies working in the Marcellus Shale.

In August, Halliburton announced it would hire 11,000 new workers this year in North America, most of them to work on shale-related projects.

Nucor may ultimately invest $3 billion in steel plants in Louisiana that could create as many as 1,000 permanent, high-paying jobs. Meanwhile, the abundance of low-cost natural-gas liquids has convinced several major chemical producers to announce expansions of existing plants as well as the construction of new facilities on the Gulf Coast and in Appalachia.

None of this is to suggest that drilling for oil and gas is easy or free. It’s not. Modern drilling and hydraulic fracturing are water- and diesel-fuel-intensive processes that require hundreds, or even thousands, of truck trips on rural roads. But the drilling-and-fracturing process lasts only a few weeks, after which all that’s left is a relatively small well head and maybe a few tanks. And the economic benefits of the commodities being produced by the many wells drilled every year in the U.S. are readily apparent.

November 14, 2011 at 8:25 AM
William R. Barker said...

http://online.wsj.com/article/SB10001424052970204358004577030110213488278.html

Some 830,000 Connecticut customers are only now having their power restored after a snowstorm knocked out the state's grid last month - but the EPA continues to claim that its regulatory agenda won't degrade U.S. electric reliability.

The reality is that the EPA's own staffers are - or used to be - worried, and their political superiors have erased the warnings.

* WHAT...?!?!

In recent months, concerns have been growing that the agency's torrent of new air-pollution rules will lead to blackouts or to the rolling outages that crisscrossed California and Arizona in September.

* BUT IN THE MEANTIME... (KEEP READING!)

[T]he EPA is trying to rush out a new utility rule that on paper will reduce mercury and other emissions but is really designed to close coal-fired power plants.

Congressional and industry investigators have combed the EPA's rule-making docket that contains hundreds of thousands pages of electronic documents. Many of these files are for some reason not "smart" PDFs (i.e., they're unsearchable). But lo and behold, they uncovered one 934-page EPA draft that was circulated within the Administration sometime before the utility rule was formally proposed. In a "What are the energy impacts?" section, the EPA concedes that it "is aware that concerns have been expressed by some, even in advance of this proposed rule, that this regulation may detrimentally impact the reliability of the electric grid."

The EPA admits that what it calls "sources integral to reliable operation" may be forced to shut down (those would be the coal-fired plants the EPA is targeting) and that these retirements "could result in localized reliability problems."

(*SMIRK*)

* AND YET...

The EPA...has [in the past] denied that reliability is in any way at risk.

But here's the kicker: This reliability section was gone when the EPA released its utility rule proposal in May 2011.

Why did it vanish? Where did it go?

This matters because the draft report contradicts EPA leaders who have publicly portrayed anyone worried about reliability as an industry shill. More importantly, as a technical and legal matter, issues that are excluded from the Federal Register mean that the public is denied the opportunity to meaningfully comment on them.

For more than a year the EPA has claimed that it doesn't need more time to finalize the rule, only to reverse itself and extend the deadline by 30 days to mid-December. But that still leaves barely any time for the White House regulatory office to review the utility rule, even as the EPA continues to rewrite major elements that supposedly resolve the reliability question but that no one outside of EPA has seen.

* SERIOUSLY, FOLKS, IS THIS ANY WAY TO RUN A COUNTRY?

November 14, 2011 at 12:17 PM
William R. Barker said...

http://online.wsj.com/article/SB10001424052970204224604577028364218075668.html?mod=WSJ_Opinion_AboveLEFTTop

Last Wednesday morning the Heritage Foundation broke news of President Obama's "Christmas tree tax," and by late afternoon the resulting furor had forced the U.S. Agriculture Department to put the $2 million plan on layaway.

(*CLAP-CLAP-CLAP*)

Under the plan, the USDA would have required Christmas tree growers to pay 15 cents per fresh-cut tree to fund an advertising board to "enhance the image of Christmas trees and the Christmas tree industry in the United States."

* YA CAN'T MAKE THIS STUFF UP, FOLKS! (INDEED, I BELIEVE I COVERED IT LAST WEEK IN NEWSBITES.)

But the idea didn't belong to the USDA - it was the Christmas tree lobby's.

The National Christmas Tree Association, a trade group, requested this "checkoff" tax in 2009, much like the 18 other generic agricultural programs that the government backs under the Commodity Promotion, Research and Information Act of 1996. (Think "Got Milk?" or "Beef: It's What's for Dinner.")

Usually on the menu in these cases are the smaller producers that don't want to chip in for marketing and would rather promote their products themselves. The bigger companies then gang up and appeal to the government.

[T]hree voluntary campaigns collapsed for lack of contributions.

The drivers of the government scheme were large Christmas tree wholesalers in Oregon, Michigan, Wisconsin, North Carolina and Pennsylvania.

(*SMIRK*)

The problem isn't so much a "tax" that would theoretically apply to the 17 million Christmas trees that will be sold this season. It's that the government would help to sell this yuletide staple at all - not to mention cotton, honey, softwood lumber, raspberries, peanuts, mangos and many others.

This was merely another corporate welfare present wrapped with government ribbon.

November 14, 2011 at 1:10 PM
William R. Barker said...

http://thehill.com/homenews/senate/193365-coburn-targets-billions-in-tax-breaks-reaped-by-millionaires

Sen. Tom Coburn (R-Okla.) released a report detailing special tax breaks for wealthy income earners... “From tax write-offs for gambling losses, vacation homes and luxury yachts to subsidies for their ranches and estates, the government is subsidizing the lifestyles of the rich and famous."

"Multimillionaires are even receiving government checks for not working,” Coburn said in a statement Monday.

The report found millionaires enjoy about $30 billion worth of “tax giveaways” and federal grants every year...

* DID WE REALLY NEED A SENATE REPORT TO TELL US THIS? IT IS THE CONGRESS - BOTH DEMPUBLICANS AND REPUBLICRATS - WHO HAVE CREATED THESE DEDUCTIONS... LOOPHOLES... SUBSIDIES...

(*GROWL*)

November 14, 2011 at 2:35 PM
William R. Barker said...

* TWO-PARTER... (Part 1 of 2)

http://online.wsj.com/article/SB10001424052970204190704577026392654471870.html?mod=WSJ_Opinion_LEFTTopOpinion

As we continue our endless debate on whether we should have more Outer Continental Shelf development - and where - all our neighbors have chosen to proceed.

Cuba, Mexico, the Bahamas, Canada and Russia are all moving ahead on offshore development adjacent to our borders.

According to the Department of the Interior, our offshore areas hold more than 86 billion barrels of recoverable oil and 420 trillion cubic feet of natural gas. The Arctic Ocean alone is projected to hold 20% of the world's undiscovered oil and gas.

* AND YET... (READ ON!)

Last week the Obama administration proposed [only] a modest expansion of offshore oil drilling in the Arctic Ocean and the Gulf of Mexico in its first concessions on offshore production since last year's Deepwater Horizon spill. The five-year plan would, [furthermore], keep Atlantic and Pacific sites off-limits in order to avoid a controversial decision before the 2012 election.

[W]e fail to boost our offshore production at our own expense. America's neighbors are not drilling for fun or for sport; they've chosen to proceed to create new jobs, generate new revenues, and increase the energy supply and prosperity of their citizens. If America pursues greater offshore development - with appropriate safeguards - the same benefits will manifest within our borders. Jobs will be created. Federal and state treasuries will receive a much-needed boost from royalties and leasing revenues.

* PLUS... IN CASE OF WAR OR OTHER WORLDWIDE CRISIS... OUR OIL WELLS WILL BE HERE AT HOME WHERE WE CAN PROTECT THEM WITHOUT DEPLOYING TROOPS ACROSS THE GLOBE! BEYOND THAT... WE WOULD THEN HAVE THE ABILITY TO REDIRECT THE OIL TO DOMESTIC USE AS OPPOSED TO SELLING IT ON THE WORLD MARKET.

* To be continued...

November 14, 2011 at 3:47 PM
William R. Barker said...

* CONCLUDING... (Part 2 of 2)

If we refuse to produce more of our energy resources, we will lose significant opportunities to rebuild our economy and restore our international competitiveness. Less obvious, but just as real, are the environmental impact that may still result even if we refuse to boost offshore production.

Like it or not, development is now under way in waters all around us. Mexico is advancing on a deepwater well only 22 miles from U.S. waters in the Gulf of Mexico. Before year's end, Cuba is scheduled to drill 60 miles from Key West, and the Bahamas are proceeding with leases not much farther away. Canada is actively drilling projects not far from Maine's coastline and proceeding towards development in the Beaufort Sea, just east of Alaskan waters. Along Alaska's western boundary, Russia is aggressively moving into the Arctic Ocean, with exploration at the very edge of the boundary of Alaskan waters.

In a few years, the U.S. could wind up in a regrettable position - exposed to all of the risks of offshore development but with no control and none of the rewards.

(*FRUSTRATED NOD*)

Imagine that foreign development is not done to our standards and a spill occurs. Neither geology nor ocean currents will respect our national boundaries. In some areas, like the Beaufort and Chukchi seas, the only way we will have oil-spill response capabilities in place or within a reasonable distance is if we are pursuing our own offshore development.

Sitting on the sidelines will also mean we have minimal influence on the standards and regulations for foreign operations. Regardless of our relations with neighbors, it's not realistic to expect them to match our requirements if we are not demonstrating that they are both workable and profitable.

Director of the Bureau of Ocean Energy Management Michael Bromwich recently testified that, while some gaps exist in spill response, the U.S. has "huge advantages based on the number of decades we've been involved in this business of exploring and producing offshore."

He's right. And so today, we face a stark choice. We can sit between active drilling operations in neighboring countries, complaining that it's too risky to develop our own resources while the world around us does exactly that. In this case, we will lose the economic opportunities but still face essentially the same environmental threats. That makes no sense.

* YEP... THAT'S FOR SURE! (AND YET... THIS IS OBAMA'S POLICY...)

Our nation's best option is not to lag but to lead on offshore development - not only so that we can show others how it's done, but also to ensure our own protection and prosperity.

The time for that leadership is now, not at some more politically convenient time after next year's election.

November 14, 2011 at 3:47 PM

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