Posts Tagged ‘gas’

http://www.reuters.com/article/idUSTRE6AG5VR20101117

U.S. can slash carbon emissions with natgas: report
Wed, Nov 17 2010
By Timothy Gardner

WASHINGTON (Reuters) – The shale gas boom could help the United States reduce greenhouse gas emissions even if Congress does not pass broad climate legislation, according to a Deutsche Bank report.

U.S. natural gas prices have fallen sharply over the last two years as supplies expanded due to the unexpectedly swift development of technologies to tap the fuel in shale formations a mile or more underground.

Lower natural gas costs have also already helped raise the proportion of U.S. electricity generated from the fuel to 23 percent from 20 percent two years ago.

As coal costs rise, the percentage for natural gas in power generation could rise to 35 percent by 2030, according to the Deutsche Bank report released on Wednesday.

The report assumes that environmental problems associated with hydraulic fracturing or “fracking” of shale gas are minimized as the technologies mature.

With Republicans taking control of the House of Representatives early next year, expectations that Congress will pass broad measures on renewable energy and climate are low.

But progress on emissions can still be made because natural gas releases about half as much of the greenhouse gas carbon dioxide as coal does.

“The role natural gas can play is so significant, it can form a type of a potentially bipartisan area of agreement,” on cutting emissions, Mark Fulton, Deutsche Bank’s global head of climate change investment research, told reporters in a teleconference.

The report said broader use of natural gas, and renewable energy like wind and solar power, could slash coal use. The efforts would cut emissions from power generation by 44 percent by 2030, it said.

Looming Environmental Protection Agency rules on mercury, particulates, and other emissions from coal-fired power plants could help reduce electricity generated from coal from about 47 percent now to about 22 percent by 2030, the report said.

That’s because scrubbers and other technologies that would have to be added to coal-fired power plants could push up the cost of power from that energy source.

A Bernstein Research note earlier this year also concluded that the EPA rules on air toxics would lead old coal plants into early retirements.

“The economics of this are compelling,” said Fulton. “This really is just pure economics, the industry will want to do this because it is cheaper.” The report assumed natural gas prices would average about $6 per mmBtu, about $2 higher than current prices.

Existing U.S. natural gas plants also have extra capacity. Two-thirds of the extra natural gas generation will come from existing plants near existing power lines, the report said.

Not everyone is happy about the gas boom. Environmentalists have complained that fracking, in which companies blast a mix of water, sand and chemicals underground to break open fissures in the shale rock, pollutes water supplies.

The report downplayed the risks and said with best practices, like recycling water used in the process, the environmental issues can be managed.

http://www.reuters.com/article/idUSTRE6AG5VR20101117

U.S. can slash carbon emissions with natgas: report
Wed, Nov 17 2010
By Timothy Gardner

WASHINGTON (Reuters) – The shale gas boom could help the United States reduce greenhouse gas emissions even if Congress does not pass broad climate legislation, according to a Deutsche Bank report.

U.S. natural gas prices have fallen sharply over the last two years as supplies expanded due to the unexpectedly swift development of technologies to tap the fuel in shale formations a mile or more underground.

Lower natural gas costs have also already helped raise the proportion of U.S. electricity generated from the fuel to 23 percent from 20 percent two years ago.

As coal costs rise, the percentage for natural gas in power generation could rise to 35 percent by 2030, according to the Deutsche Bank report released on Wednesday.

The report assumes that environmental problems associated with hydraulic fracturing or “fracking” of shale gas are minimized as the technologies mature.

With Republicans taking control of the House of Representatives early next year, expectations that Congress will pass broad measures on renewable energy and climate are low.

But progress on emissions can still be made because natural gas releases about half as much of the greenhouse gas carbon dioxide as coal does.

“The role natural gas can play is so significant, it can form a type of a potentially bipartisan area of agreement,” on cutting emissions, Mark Fulton, Deutsche Bank’s global head of climate change investment research, told reporters in a teleconference.

The report said broader use of natural gas, and renewable energy like wind and solar power, could slash coal use. The efforts would cut emissions from power generation by 44 percent by 2030, it said.

Looming Environmental Protection Agency rules on mercury, particulates, and other emissions from coal-fired power plants could help reduce electricity generated from coal from about 47 percent now to about 22 percent by 2030, the report said.

That’s because scrubbers and other technologies that would have to be added to coal-fired power plants could push up the cost of power from that energy source.

A Bernstein Research note earlier this year also concluded that the EPA rules on air toxics would lead old coal plants into early retirements.

“The economics of this are compelling,” said Fulton. “This really is just pure economics, the industry will want to do this because it is cheaper.” The report assumed natural gas prices would average about $6 per mmBtu, about $2 higher than current prices.

Existing U.S. natural gas plants also have extra capacity. Two-thirds of the extra natural gas generation will come from existing plants near existing power lines, the report said.

Not everyone is happy about the gas boom. Environmentalists have complained that fracking, in which companies blast a mix of water, sand and chemicals underground to break open fissures in the shale rock, pollutes water supplies.

The report downplayed the risks and said with best practices, like recycling water used in the process, the environmental issues can be managed.

Originally Posted at: Reuters.com

Proposed revisions to Pennsylvania’s oil and gas law will force drillers to disclose for the first time the names and amounts of chemicals they inject underground to coax oil and gas from rock.

But the final revision of those rules – earlier versions of which had been applauded by citizens and environmental groups as a step forward in terms of public health and safety – contain provisions that will limit the amount of information drillers have to disclose.

The new rules are meant to provide citizens and regulators with information about the specific chemicals that are used to hydraulically fracture gas wells drilled next to homes and water supplies.

The process, which the industry contends has never polluted drinking water, has been criticized because companies have been reluctant to reveal the chemicals they use – making it difficult to prove suspected pollution is caused by gas drilling.

Unlike earlier drafts of the regulations that were open for public review and comment, the final draft describes in detail the information drillers will have to disclose about each well, including the name and percent by volume of each chemical additive, as well as the names, unique identifying numbers and amounts of hazardous chemicals that make up those additives.

The final draft also describes the limits of that disclosure, including for the first time a provision that allows drillers to designate parts of the record as containing trade secrets that will be kept from the public, and another provision requiring drillers to disclose only the chemicals listed on federal safety documents – called material safety data sheets – instead of every toxic or nontoxic chemical injected in a well.

The changes were motivated by a comment letter submitted by Halliburton, the energy services giant, questioning the need for disclosure beyond what is contained in material safety data sheets and saying the draft regulations created “serious risks” to its trade secrets, including the identity of “specific proprietary chemicals.”

Halliburton “believes that any requirement that service companies routinely disclose information concerning the chemical constituents of frack fluid additives … would be inappropriate because it would require the disclosure of trade secret information when it is not needed and would serve as a disincentive to future frac fluid and technical innovation,” the company wrote.

The Department of Environmental Protection, which developed the revised regulations, said it struck an appropriate balance between public disclosure and protecting confidential information.

But critics of the final revisions look at similar rules adopted by the state of Wyoming this year and see Pennsylvania’s proposed standard as a step backward.

“I think it’s sad that when you’re writing new regulations you are actually doing less than what is state of the art,” said Deborah Goldberg, managing attorney of the eastern regional office of Earthjustice. “There are better regulations out there; you know what they look like; they are already in effect; they haven’t shut down the industry; and you still don’t do the best for your citizens. That’s a shame.”

The Wyoming rules – the first in the nation to require well-by-well disclosure of the chemicals used in hydraulic fracturing – require drillers to disclose all chemicals used in the process, not just those listed on material safety data sheets. That matters, Goldberg said, because many lesser-studied chemicals are not included on the safety sheets, even if they are known or suspected to be toxic. And nontoxic chemicals not on the sheets may combine with other chemicals to become toxic.

“MSDS sheets are widely known to be insufficient to really give people the information they need to protect themselves,” she said.

And although Wyoming also allows companies to invoke trade secrets claims, regulators there have committed to scrutinizing those claims as they are submitted and have routinely rejected drillers’ reports that incompletely identify the chemical constituents.

Under Pennsylvania’s Right-to-Know Law, companies are allowed to designate information as a trade secret and the validity of that claim is only scrutinized once someone requests to see the record.

Scott Perry, the director of DEP’s Oil and Gas Bureau, said the agency is restricted in what it can ask drillers to disclose because of the trade secrets standard set in the state’s Right-to-Know Law.

“We don’t have the same statutory authority as Wyoming does to be requesting all of this other information,” he said.

“I think we’ve drawn an appropriate line that addresses the public’s right to know what’s being used at these sites without drifting into areas where, quite frankly, we would be in litigation.”

Legal challenges might have held up the full suite of oil and gas revisions, which include stronger casing and cementing standards, stricter provisions requiring drillers to respond when they impact drinking water supplies and greater use of well blowout prevention equipment, he said.

The rules face reviews by the House and Senate environmental resources committees and a vote this month by the Independent Regulatory Review Commission before they take effect next year.

llegere@timesshamrock.com

View article here.

Copyright:  The Citizens Voice

“We’re regretful that there wasn’t closure brought toward achieving commonsense legislative initiatives“

Canonsburg, PA – As the Pennsylvania General Assembly’s legislative session draws to a close, Marcellus Shale Coalition (MSC) president and executive director Kathryn Klaber issued the following statement regarding the months of good-faith, broad-based discussions that the industry continues to participate in with the goal of reaching sound, legislative and regulatory solutions that will encourage economic growth and job creation, while helping to put the Commonwealth on a path towards a cleaner energy future:

“From the outset of these discussions, our industry has been working closely with elected leaders and key stakeholders in an effort to modernize the Commonwealth’s legislative and regulatory framework. These commonsense and shared goals will help ensure that capital investment will continue to flow into Pennsylvania, which is critical to expand job opportunities during this period of high unemployment and economic uncertainty.

“Expanding the responsible development of the Marcellus Shale’s abundant, clean-burning natural gas resources will also help put our region and the nation on a path toward a cleaner and more secure environmental future.

“As part of a well thought out and considerate comprehensive overhaul that includes legislative and regulatory modernizations, our industry maintains its support for a competitively structured severance tax that allows for capital recovery and reinvestment, comparable to other leading shale gas producing states, such as Arkansas, Texas and Louisiana.

“The leadership in the state senate deserves credit for their months of work in crafting a competitive, well-balanced package of reforms that would help ensure Pennsylvania remains a leader in responsible shale gas development.

“While our commitment to achieve these shared goals remains steadfast, we’re regretful that there wasn’t closure brought toward achieving these commonsense initiatives during this legislative session. We must get this historic opportunity right; we cannot afford not to.”

NOTE: Below are a host of MSC statements regarding regulatory and legislative developments and proposals:

• “Kathryn Klaber … says the bill the House passed is more than double what is the least competitive severance tax in other shale gas states. The House bill would put a 39 cent tax on every thousand cubic feet of gas drilled. Klaber says a severance tax that is not competitive with other states would stifle competition in Pennsylvania.” (WDUQ,10/11/10)
• “A competitively structured tax in Pennsylvania, that allows for critical capital investment, coupled with smart regulatory and legislative modernizations, is key to ensuring that this historic opportunity is realized in ways that benefit each and every Pennsylvanian.” (MSC statement, 9/29/10)
• “A fair, competitive and updated regulatory framework and tax structure has been, and continues to be the position of the Marcellus Shale Coalition – a position the industry has conveyed to both the executive and legislative branches of our state government.” (MSC statement, 9/20/10)
• “Kathryn Klaber, executive director of the MSC, an advocacy group representing almost all of the state’s shale gas producers, said the Arkansas [tax] model is one the coalition has been encouraging because ‘we view it as a good way to encourage development and return some revenue to local governments.’” (Pittsburgh Post-Gazette, 9/8/10)
• “MSC President Kathryn Klaber says the fiscal code language about the severance tax proposal includes a commitment by elected leaders to conduct a comprehensive evaluation of ‘how best to seize on the opportunities of the Marcellus in the future, and do so in a manner that benefits all Pennsylvanians.’ … ’We need an updated and modernized regulatory and legislative framework, and a fair tax strategy that keeps our state ahead of the curve in attracting the investment needed to bring these resources to the surface.’” (WDUQ, 7/7/10)
• “MSC members will continue to be key participants in this iterative, ongoing process, working alongside the General Assembly, the administration and stakeholders across the Commonwealth to put our state in the best possible position to seize on the extraordinary opportunities of the Marcellus. And when it comes to that objective, there’s nothing more important than having a tax, regulatory and legislative framework in place that’s collaborative in its approach, and comprehensive in its design. Today’s agreement moves us one step closer toward the realization of such a plan.” (MSC statement, 7/6/10)
• “We will continue to work closely with the General Assembly, the governor and his administration, as well as county and local officials, to craft commonsense solutions – especially modernizing our outdated regulatory framework – that encourage competitiveness, expanded job creation and energy security.” (MSC statement, 6/15/10)
• “Kathryn Klaber, president of the MSC … said state regulations need to be ‘dusted off and modernized’ but emphasized the competitive nature of the gas drilling industry and its economic benefits for the state.” (Pittsburgh Post-Gazette, 5/4/10)
• “We stand ready to work with you on a plan to convert this potential into historic opportunities for the future – and look forward to continuing to update you and your colleagues on our progress and priorities in the weeks and months to come.” (MSC letter to General Assembly, 4/8/10)
• “The MSC is committed to an ongoing dialogue with key stakeholders on the development of this framework. This opportunity is far too important for Pennsylvania’s economic future and the future of clean energy development for the nation. We will continue to work closely with lawmakers and regulators to make sure Pennsylvania gets it right, especially given how fortunate we all are to have this once-in-a-lifetime chance to make a difference in the lives of so many.” (MSC statement, 2/9/10)

Copyright http://marcelluscoalition.org/

Encana to finish drilling at Luzerne gas test well

Encana Oil & Gas USA Inc. is preparing to wrap up drilling operations soon at the company’s – and Luzerne County’s – second exploratory natural gas well.

According to an update from Encana, drilling is nearly complete at the Salansky site on Zosh Road in Lake Twp.

“We installed additional directional signs and turning points leading in and from this location to remind anyone working on behalf of Encana to follow the approved ingress and egress,” the company’s newsletter states.

The Lake Twp. well is Encana’s second. The first – not only for the company, but for Luzerne County – at the Buda property off Route 118 in Fairmount Twp., has already been drilled.

However, Encana has not scheduled completion, which includes hydraulic fracturing, for either well. Hydraulic fracturing involves blasting millions of gallons of water at high pressure deep underground to break up the shale rock and release the gas.

Due to the dry conditions over the summer, some natural gas companies, including Encana, had their sources of water put temporarily off-limits by the Susquehanna River Basin Commission, which regulates large water withdrawals from all sources within the river’s watershed. Those withdrawal bans were lifted by the commission after the rainy weather recently experienced by the region.

Another of Encana’s projects is starting to take shape. The company is building what it calls the Alimar natural gas processing facility at 44 Hartman Road in Fairmount Twp. This facility will process the natural gas and get it into the nearby Transco pipeline to be sent to market. Encana reports that Alimar site preparation is complete and foundation con­- struction has started.

The company is also planning more wells. Encana has received permission for 10 new wells from Luzerne County, and has state approval for half of them so far.

The state Department of Environmental Protection is still reviewing Encana’s plans for five new wells on the 4-P Realty property on Loyalville Road in Lake Twp. DEP has already granted Encana permits for four horizontal wells and one vertical well in Fairmount Twp., on the property of William Kent.

So far the only DEP violation Encana has committed has been administrative; the company failed to file the required production reports on time – even though the wells are not yet producing any gas. The company has since remedied the oversight and is now in compliance.

Contact the writer: eskrapits@citizensvoice.com

View article here.

Copyright:  The Scranton Times

Senate should consider alternative to House’s uncompetitive approach

Canonsburg, Pa. – This evening, the Pennsylvania House of Representatives passed a massive, uncompetitive new tax on the responsible development of clean-burning natural gas from the Marcellus Shale formation, which has helped create nearly 88,000 jobs in Pennsylvania alone as the state’s unemployment rate continues to remain near double-digits. This massive new tax – 39 cents per mcf of natural gas – represents the nation’s highest among shale gas producing states. In fact, this onerous tax on shale gas production is twice as high as West Virginia’s, currently the nation’s highest.

Equally problematic, this enormous tax does not allow for natural gas producers to recover and reinvest the millions of dollars required to produce shale gas from the Marcellus, as virtually every other major shale gas producing state does. Many members of the House of Representatives voted against this massive tax, recognizing the negative impact it would have on job creation and investment in Pennsylvania.

Kathryn Klaber, president and executive director the Marcellus Shale Coalition (MSC), issued this statement following the vote:

“Votes for this misguided, unprecedented tax that narrowly passed this evening, are votes against the job creation and the responsible development of clean-burning domestic natural gas, which is helping to lower energy prices for Pennsylvania consumers and driving down our nation’s dependence on foreign sources of energy.

“We are confident, based on Senator Scarnati’s public comments this evening, that the Senate will remain steadfast in their commitment to realize a competitive climate for growth for this industry, and prosperity for Pennsylvanians.

“To make certain that Pennsylvania’s economy and workforce remain ahead of the curve in the increasingly competitive global economy requires commonsense solutions that encourage capital investment in the Commonwealth. A competitively structured tax in Pennsylvania, that allows for critical capital investment, coupled with smart regulatory and legislative modernizations, is key to ensuring that this historic opportunity is realized in ways that benefit each and every Pennsylvanian.”

NOTE: In a statement, Rep. Dwight Evans (D-Philadelphia), chairman of the House Appropriations Committee, underscored the fact that “We need a tax that is competitive with other shale states.” Rep. Evans adds: “I also recognize the industry will want to weigh in and argue for a tax with a rate and characteristics that allow for capital recovery, a tax it can support as it does in every other state where drilling occurs. These issues are all negotiable.”

In the Sept. 22 editorial “Shale Worries: Loss of Property Rights Could Be the Next Threat,” the Post-Gazette mischaracterizes the concept of fair pooling, a policy that states have used wisely for generations to reduce above-ground surface activities, while maximizing responsible shale gas production and its host of benefits.

Pooling — which is on the books in every major energy-producing state for horizontal drilling, except Pennsylvania — ensures that mineral owners are compensated for the production of their natural gas.

Your readers, and your editorial writers, should understand that new technologies allow natural gas reserves to be reached thousands of feet below ground, and thousands of feet horizontally from a drilling pad. Unfortunately, under current law, a single landowner could deny the rights of a vast majority of landowners from producing their natural gas reserves. How fair is that?

In June 2009, the Post-Gazette editorialized in favor of a severance tax on shale gas production because “most states, including West Virginia, already” have such a tax, adding that “it is only fair that Pennsylvania share in the wealth.” By that logic, doesn’t Pennsylvania need a common-sense pooling statute, too, since other states (including West Virginia) have one?

The paper is right to characterize Pennsylvania’s natural gas industry as a source of “promising new jobs and income”; in fact, the responsible development of the state’s shale gas resources has created more than 44,000 jobs so far in the commonwealth, with many more in the coming months and years. A competitive tax structure, along with common-sense laws such as fair pooling, will only help build on this tremendous and historic opportunity.

DAVID CALLAHAN

Vice President

Marcellus Shale Coalition

– Link to original Letter to the Editor in Pittsburgh Post-Gazette:  http://www.post-gazette.com/pg/10270/1090577-110.stm

Copyright: Marcelluscoalition.org