EPA’s Unjustified Particulate Matter Proposal

Three good reasons EPA should shelve a proposal to tighten its air pollution standard governing particulate matter:

Science doesn’t justify it.Current control programs are working.A more stringent standard could harm jobs and economic growth.

EPA is scheduled to hold public hearings on its PM 2.5 standard today in Philadelphia and Sacramento – part of a commenting period that runs into August. The proposal, which is to be finalized by the end of the year, would tighten the standard from 15 micrograms per cubic meter to 12 or 13 micrograms.

API’s Howard Feldman, director of regulatory and scientific affairs, discussed the proposal during a conference call with reporters:

“Changing the standard should be supported by clear scientific analysis. The science in this case cannot demonstrate a proven ‘cause and effect’ between levels below the current standard and health consequences. In part, this is because in EPA’s analysis it failed to adequately address confounding factors. EPA also assumed rather than demonstrated a linear relationship between pollution and health effects, concluding that harm to health must occur even at very low levels.”

Feldman, who was to deliver testimony in Philadelphia, said a tighter standard could result in higher costs for providing and using energy, meaning fewer businesses would be created, fewer would expand and fewer workers would be hired. Feldman:

“Existing control programs are working. According to EPA, between 2000 and 2010, concentrations of PM 2.5 in the air fell by 27 percent. As a result, more than three-fourths of Americans today live in areas where air quality meets today’s standards.”

Dr. Julie Goodman of Gradient, an expert in toxicology, epidemiology and in assessing health risks from chemicals in products and the environment, also joined the call. Goodman said EPA has not produced “coherent evidence” that a new PM standard is necessary:

“There’s no evidence that lowering (the standard) 2 to 3 micrograms will have any effect on health. In other words, there’ll be no (real) health benefits from lowering the standard.”

Goodman’s remarks for the Philadelphia hearing can be read here.

View the original article here

Enter Innovation: Improving the Fracking Process

One of the factors involved in pulling energy from shale through hydraulic fracturing is how much water is needed – typically 2 to 4 million gallons per well. Though that’s not as much water as it sounds (electrical generation for the Susquehanna River Basin requires nearly 150 million gallons per day), it’s a public concern. More on water usage at the FracFocus website.

Water also is an industry concern. It isn’t free, and once the well has been stimulated with fracking, there’s waste water that has to be disposed of or recycled. Enter innovation. A number of companies are tackling the issue.

Schlumberger’s HiWAY flow-channel technology claims to use less water, with greater effectiveness:

“HiWAY technology fundamentally changes the way proppant fractures generate conductivity. The first technique of its kind, HiWAY fracturing creates open pathways inside the fracture, enabling hydrocarbons to flow through the stable channels rather than the proppant. This optimizes connectivity between the reservoir and the wellbore—resulting in infinite fracture conductivity.”

Other companies are marketing waterless alternatives, using other agents to apply pressure to the shale – producing microscopic fractures and introducing sand or other proppants to keep the cracks open so the oil or natural gas can drain from the shale and be collected.

Baker-Hughes has developed VaporFrac, combining a high-pressure nitrogen and/or carbon dioxide gas stream and an ultra-lightweight proppant slurry:

“This method safely creates a flow stream that is more than 90% gas, significantly reducing post-frac cleanup. The high energy of the gas phase makes for easy flowback. There’s a quicker tie into pipelines.”

GASFRAC Energy Services’ liquefied petroleum gas (LPG) gel is primarily propane, which the company says has a number of advantages in fracking:

“Since our gel regains permeability with the hydrocarbons we stimulate, we have the ability to recover 100% of the fracturing fluids within days of stimulation. This creates economic and environmental benefits reducing clean-up, waste disposal and post-job truck traffic, while creating higher initial production levels.”

No doubt, other companies, other energy innovators, are at work on this question. The point here is to show the kind of invention that’s being sparked by necessity surrounding water and fracking. Businesses are taking on this issue and others associated with energy development with the goal of making processes better, safer, more efficient and more environmentally friendly. When we hear about their stories, we’ll pass them along.

View the original article here

Cooking With Gas–And Loathing It?

The intersection of a recent anti-natural gas fundraiser at the trendy Brooklyn Winery – featuring fabulous culinary delights prepared by a group of talented chefs – and the natural gas that made the evening possible was, well, simply mouth-watering.

New York Daily News columnist Bill Hammond writes that the “Taste of the Marcellus” event last week was hosted by a group called Chefs for the Marcellus, to showcase the kinds of foods they say could be jeopardized if New York Gov. Andrew Cuomo OKs hydraulic fracturing in that state’s portion of the Marcellus Shale. Hammond:

"Guests were treated to eggplant-stuffed okra, smoked lamb belly with fermented tofu and whipped ricotta jewel on toast — along with wines from the Finger Lakes and beers from Cooperstown’s Ommegang brewery. The only thing more delicious than the menu was the irony, because many if not most of those dishes were cooked over the bright blue flame of natural gas. That’s right, the Chefs for the Marcellus saw nothing wrong with using the very same fuel they portray as a dire threat to the upstate countryside."

He writes that even stuff that wasn’t simmered or seared over a gas flame was chilled in refrigerators running on electricity, much of which no doubt was generated at natural gas-fired power plants. Same thing for the restaurant AC that kept the guests comfortable. Every cubic foot of gas used, he notes, came from a hole in the ground – a quarter of it (based on national averages) from the same hydraulic fracturing process the group opposes.

Then there’s this quote Hammond got from Chefs for the Marcellus organizer Hilary Baum – as tantalizing as the sungold tomato gazpacho with smoked trout that was part of the featured fare:

“We all cook with gas. We all use gas. But we have to be looking at developing alternative energy sources and not be so stuck on fossil fuels.”

To ice the cake, Hammond quotes the Manhattan Institute’s Robert Bryce:

“It’s easy to demonize the oil and gas industry. But getting along without the fuels they provide takes us back to the Stone Age.”

Amen. Pass the trout.

View the original article here

Welcoming Interior to the Energy Jobs Bandwagon

A couple of points from the Interior Department’s report on its contributions to the economy in 2011, which you can read in full, here.

First, we agree: Energy development indeed is a dynamic job creator and stimulus that ripples throughout local, state, regional and national economies. Interior says the development of oil, natural gas, coal, hydropower and other minerals on federal lands supported 1.5 million jobs and contributed $275 billion to the economy, and that’s great.

Every job is a paycheck, and energy development – whether on federal, state or private lands – is creating jobs. Lots of them. (Read here for an argument that oil and natural gas have been a lifeline for the struggling U.S. economy.) Our industry supports 9.2 million jobs overall and contributed $476 billion to the economy in 2010. And our companies are ready to do more.

That’s the other key point: If Interior is reporting that many jobs and that much economic stimulus – at a time when federal leasing and permitting policies onshore and offshore are less robust than they could be – imagine what could result with increased access to federal lands, more lease sales and a permitting process that’s been cleared of unnecessary delays and restrictions.

We already have. With the right policies in place, our industry could create 1.4 million new jobs and generate $800 billion in new revenue for governments by 2030, according to last fall’s Wood Mackenzie study. With a pro-energy development approach – expanded offshore leasing, drilling in an airport-sized parcel of the 19 million-acre Arctic National Wildlife Refuge, construction of the Keystone XL pipeline and other pipelines, the U.S. could see 100 percent of its liquid fuel needs met domestically and from Canada by 2024.

One last point. We’re glad to see Interior’s methodology for counting jobs includes “direct,” “indirect” and “induced” jobs (see pg. 197). Maybe it’ll help cool the jets of some who’ve scoffed at jobs estimates for the oil and natural gas industry.

View the original article here

EPA’s Unjustified Particulate Matter Proposal

Three good reasons EPA should shelve a proposal to tighten its air pollution standard governing particulate matter:

Science doesn’t justify it.Current control programs are working.A more stringent standard could harm jobs and economic growth.

EPA is scheduled to hold public hearings on its PM 2.5 standard today in Philadelphia and Sacramento – part of a commenting period that runs into August. The proposal, which is to be finalized by the end of the year, would tighten the standard from 15 micrograms per cubic meter to 12 or 13 micrograms.

API’s Howard Feldman, director of regulatory and scientific affairs, discussed the proposal during a conference call with reporters:

“Changing the standard should be supported by clear scientific analysis. The science in this case cannot demonstrate a proven ‘cause and effect’ between levels below the current standard and health consequences. In part, this is because in EPA’s analysis it failed to adequately address confounding factors. EPA also assumed rather than demonstrated a linear relationship between pollution and health effects, concluding that harm to health must occur even at very low levels.”

Feldman, who was to deliver testimony in Philadelphia, said a tighter standard could result in higher costs for providing and using energy, meaning fewer businesses would be created, fewer would expand and fewer workers would be hired. Feldman:

“Existing control programs are working. According to EPA, between 2000 and 2010, concentrations of PM 2.5 in the air fell by 27 percent. As a result, more than three-fourths of Americans today live in areas where air quality meets today’s standards.”

Dr. Julie Goodman of Gradient, an expert in toxicology, epidemiology and in assessing health risks from chemicals in products and the environment, also joined the call. Goodman said EPA has not produced “coherent evidence” that a new PM standard is necessary:

“There’s no evidence that lowering (the standard) 2 to 3 micrograms will have any effect on health. In other words, there’ll be no (real) health benefits from lowering the standard.”

Goodman’s remarks for the Philadelphia hearing can be read here.

View the original article here

Hot Dogs, BBQs…and Fracking

Kudos to Fuel Fix.com for cooking up a link between hot dogs and fracking in time for the Fourth of July – making the point that chemicals used in hydraulic fracturing are all around our daily lives, in some of the things we eat and other products that make our lives better.

Take the hot dog. Fuel Fix points out that the staple at cookouts, ballparks and fireworks displays often contains something called sodium erythorbate for fast curing and retention of the hot dog’s distinctive pink color. In fracking, it helps prevent precipitation of metal oxides, improving the process.

Going to a barbecue? Many BBQ sauces contain guar gum, derived from (you guessed it) the guar bean. In hydraulic fracturing, guar gum thickens the water in the fracking fluid, better suspending the sand that keeps tiny cracks in rocks open so oil or natural gas can be recovered.

It’s true: Not all of the stuff that goes into fracking fluid can be ingested by humans, yet these substances are found in things people use all the time. Check out Fuel Fix’s neat slideshow for a different way of looking at a drilling process that’s revolutionizing this country’s energy production.

Final point: The typical fracturing fluid is made up of 99.5 percent water and sand. Just half of 1 percent is chemical ingredients. See FracFocus.org for more information on fluid composition and other aspects of the hydraulic fracturing process, as well as the Energy From Shale website – and Happy Independence Day!

View the original article here

Jobs? Revenue for Government? We Can Help

A new USA Today/Gallup poll finds two of the top three issues that Americans care about the most in this election year are … jobs and reducing the federal budget deficit. Check and check. America’s oil and natural gas industry can help with both. Respondents were asked to weigh the importance of a number of issues (see chart), and 92 percent said creating good jobs is “extremely/very important.” On cutting the federal deficit the figure was 86 percent. Jobs and revenue to the government – we can help.

With the right policies in place – increasing access to American natural resources, the right approach to energy regulation, encouraging energy investments and more – our industry could create 1.4 million jobs by 2030. Here’s how the Wood Mackenzie energy consulting firm charts the potential jobs growth:

Leadership is needed to make this happen. Industry is doing its part – investing in America – and it’s willing to do more.

As for tax revenue for government, to help with the deficit, Wood Mackenzie estimates a pro-energy development strategy could generate a total of more than $800 billion by 2030:

Again, in a struggling economy the oil and natural gas industry is adding jobs and supporting communities while generating revenues for government. Energy-driven economic growth that’s being seen in North Dakota, Texas, Pennsylvania and other states can be realized in other places with a true all-of-the-above (and below) energy strategy.

View the original article here

Fix the Renewable Fuels Standard

There was good discussion of the Renewable Fuels Standard (RFS) during a Hill hearing this week. API supports the appropriate use of ethanol, biodiesel and other biofuels in transportation fuels, but, unfortunately, in some ways the standard is bearing out the law of unintended consequences.

API President and CEO Jack Gerard addressed the House energy and power subcommittee, noting that U.S. refiners have primary responsibility for meeting the RFS requirements, blending nearly 15 billion gallons of ethanol in gasoline. But the RFS’ requirements are producing some bad policy, Gerard said:

“EPA has allowed the RFS law’s volume requirements to drive decisions that are inappropriate and unwise.  The law has become increasingly unrealistic, unworkable, and a threat to consumers.  It needs an overhaul, especially with respect to the volume requirements.” 

Gerard detailed ill effects stemming from the RFS’s volume mandates:

E10 “Blend Wall” – 10 percent ethanol content in fuel is safe for U.S. vehicle engines, service station pumps and storage tanks. But under the law, the ethanol volume in the overall fuel supply is required to increase and could exceed 10 percent as early as 2013. That’s the so-called “blend wall.” At that point refiners will have only two options: produce E15 (15 percent ethanol) and flexfuel or E85 – a blend of between 51 percent and 83 percent ethanol by volume that can be used only in flexfuel vehicles, which make up about 5 percent of the U.S. vehicle fleet today. More on E15 below. The problem with E85 is that it has a lower fuel economy than gasoline, and less than 2 percent of retail stations offer it.

E15 – EPA has approved the use of E15 for part of the vehicle fleet to help accommodate increases in the RFS volume requirement. But a recent study showed that E15 could damage engines that weren’t designed to use it, as well as gasoline station pump equipment. The risk can be measured in the billions of dollars. The Auto Alliance weighed in on E15, here. U.S. Rep. James Sensenbrenner shared the concerns of auto makers in a letter to EPA Administrator Lisa Jackson last summer. Gerard:

“EPA should not have proceeded with E15, especially before a thorough evaluation was conducted to assess the full range of short- and long-term impacts of increasing the amount of ethanol in gasoline on the environment, on engine and vehicle performance, and on consumer safety.”

Cellulosic ethanol – A 2007 law requires increasing use of this advanced form of ethanol that theoretically can be made from a broader range of feedstocks. But it isn’t available, because no one is making it commercially. The Competitive Enterprise Institute’s Brian McGraw has more details, here. Even so, EPA continues to assert that aggressive mandates, not based on actual production, will somehow stimulate production. EPA could waive the provision but instead is insisting that refiners buy credits for a non-existent fuel, which will drive up costs and might harm consumers.

RINS – This stands for renewable identification numbers, which are used with renewable fuel credits that some refiners have purchased under a program created by EPA. Some refiners became fraud victims after buying invalid credits in good faith. EPA’s initial response was that the bad credits were the refiners’ problem, and that they’d have to buy more. This adds more costs to making gasoline. Industry currently is trying to work out the problem with EPA.

Again, industry supports renewable fuels. But the RFS as written threatens to become counterproductive. Gerard:

“The RFS law needs to be altered to fix what isn’t working and take into account the ability of the vehicle fleet and fueling infrastructure to safely use renewable blends. Mandates must have periodic technology/feasibility reviews to allow for appropriate adjustments. Biofuels are an important part of the nation’s energy mix.  But current law and how it is implemented have become increasingly problematic.  This could eventually hurt consumers and erode support for the RFS program.”  

The answer is commonsense problem-solving, including positive collaboration between government and industry. While the goals of the RFS are well-intentioned, the marketplace realities are concerning, with potentially negative effects on companies and consumers that should be fixed.

View the original article here

Hailing the Chief’s Support for Natural Gas Development, Fracking

President Obama deserves credit for standing fast in his support for natural gas development through hydraulic fracturing – especially given the no-to-natural gas approach taken by some of his supporters in the environmental community, including the Sierra Club. Here’s the president on Monday in Cincinnati:

“… We’re moving in the right direction in terms of energy independence. Now, part of that is this boom in natural gas.  And this is something we should welcome, because not only are we blessed with incredible natural gas resources that are now accessible because of new technologies, but natural gas actually burns cleaner than some other fossil fuels, and is an ideal fuel -- energy source that we potentially can use for the next 100 years.  So I want to encourage natural gas production.  The key is to make sure that we do it safely and in a way that is environmentally sound.”

The president is spot on – and as a response to a negative question about natural gas, his remarks were all the more remarkable. Because of abundant, affordable gas, made accessible through fracking, the global energy balance could be shifting. The president continued:

“Now, you always hear these arguments that somehow there’s this huge contradiction between the environment and economic development, or the environment and energy production.  And the fact of the matter is that there are a lot of folks right now that are engaging in hydraulic fracking who are doing it safely.”

This also is true. The oil and natural gas industry has focused on making hydraulic fracturing safer and more efficient through a set of standards that guide operators, and it has worked with states to develop regulatory regimes tailored for their specific conditions. The president went on:

“The problem is, is that we haven’t established clear guidelines for how to do it safely, and informed the public so that neighbors know what’s going on, and your family, you can make sure that any industry that’s operating in your area, that they’re being responsible.”

Well, OK. The president is mistaken or misinformed on that point. Industry has been clear and detailed in developing the standards mentioned above. It also has supported FracFocus.org to create transparency about fracking itself – a website community members can use to learn where wells are being drilled in their area, as well as the chemicals being used in the fracking fluids themselves. The industry takes community engagement and support seriously and is committed to getting shale development right.

Back to the president:

“What we’ve said is, look, we are going to work with industry to establish best practices.  We are going to invest in the basic research and science required to make sure this is done safely and in a way that protects the public health.  And for responsible companies, they should be able to operate, make a profit, and we can all benefit and put people back to work."

Best practices, we’re on it, Mr. President. Industry also is supportive of new technologies to improve operations, including those to reduce or even eliminate water use during the fracking process. Shale energy is creating jobs, thousands of them, and boosting the economy.

View the original article here

Energy: It’s About Jobs

The latest jobs report, showing the creation of just 80,000 new jobs in June, is refocusing the political debate on the economy. How meager is 80,000 jobs? Well, according to UPI that’s “not even enough to keep up with growth in the working-age population,” which last month grew by 191,000. Meanwhile, a Rasmussen survey reports that only 31 percent of likely voters say the president is doing a good or excellent job handling economic issues.

Short analysis: It’s about jobs. Good news: It doesn’t have to be hard.

Energy-related job booms in North Dakota, Pennsylvania, Texas and other states are showing what’s possible – in terms of jobs, tax-revenue generation and associated economic growth – when energy development leads the way. The Institute for Energy Research’s Robert Bradley Jr., in an article for Oilprice.com:

"In North Dakota, where drillers are producing crude oil from the Bakken Shale, workers are finding jobs offering wages that are significantly higher than the national average. Truck drivers are being paid $80,000 a year to start. Some workers on oil rigs are being paid six figures. And yet many jobs are going begging. According to the mayor of Williston, 'A lot of jobs get filled every day, but it’s like for every job you fill, another job and a half opens up.' In April, North Dakota had a jobless rate of 3.0 percent, the lowest in the country."

Additional detail:

In Pennsylvania, Bradley writes, state analysis projects jobs for drill operators will grow nearly 85 percent this year (compared to sub-3 percent growth otherwise in the state).Expansion is occurring in Texas’ Eagle Ford shale play, Louisiana’s Haynesville Shale, Arkansas’ Fayetteville Shale and other energy-rich rock formations, “increasing domestic energy supplies, making energy more affordable, and spawning subsidiary investments in the private sector creating additional jobs.”A steel plant in Ohio is adding 200 jobs to produce more drill pipe.A planned ethane plant in Texas is expected to create 400 jobs.

Bradley:

"These jobs are being created by companies, not the federal government. And they are based on 'made in the USA' technologies that have the potential to greatly increase nation’s energy security and alter the world’s balance of power. As U.S. oil and natural gas supplies increase, some experts believe American energy independence is on the horizon."

On his blog, John R. Hanger connects energy production and employment:

"Jobs are a major product of that commerce and energy production. The 5 biggest energy producing states all have unemployment rates below the national average, but the same cannot be said about the 5 states producing the least energy." 

Meanwhile, Canada, which a few years ago staked its economic revitalization on energy, is looking for U.S. workers to fill anticipated job slots in Alberta. The Edmonton Economic Development Corporation expects a shortage of 114,000 workers in the coming months and has set up the aptly named opportunityawaits.com website to promote job openings. One U.S. veterans group is reaching out to former military personnel and active-duty soldiers who soon will transition to civilian life, encouraging them to consider oil sands and Keystone XL pipeline jobs in Canada. Fox News has a story, here. Again, the point is to recognize the dynamic economic power of the energy stimulus.

No question, U.S. jobs figures for June suggest a still-struggling economy. The administration says it’s not to blame, that there are limits to what a president can do to change the national economic trajectory. Indeed, a president has limited options – so perhaps the first move is to not stand in the way of growth.

Energy is a proven job creator, a shining sector in the weak economy. But the administration is making energy expansion harder, not easier. It is delaying construction of the Keystone XL pipeline, and it is restricting offshore energy development. Its permitting policies in the Gulf of Mexico have suppressed production there, costing jobs and economic opportunity throughout the region. It is sending confusing messages on hydraulic fracturing, the shale technology that is unlocking America’s ample energy potential.

America’s oil and natural gas companies are creating good jobs and can create even more. With the right policies this industry can add 1 million new jobs before the end of the decade. Here’s a blueprint for an American-made energy policy.  It’s energy, it’s jobs and it’s within our reach.

View the original article here