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Oil Industry Caused 2005 Swarm of California Earthquakes: Newly Published Study

Oil Industry Caused 2005 Swarm of California Earthquakes: Newly Published Study

A string of quakes ending on Sept. 22, 2005 struck in Kern County near the southern end of California’s Central Valley  – and the new study, published in Geophysical Research Letters, concluded that the odds that those quakes might have occurred by chance were just 3 percent.

Instead, the researchers honed in on a very specific set of culprits: three wastewater injection wells in the Tejon Oil Field. Between 2001 and 2010, the rate of wastewater injection at that oil field quintupled, and up to 95 percent of that wastewater was sent to just that trio of closely-spaced wells, the scientists noted.

The largest of the earthquakes in the swarm measured magnitude 4.6 on the Richter scale meaning that the quakes were relatively small, unlikely to have done any damage to buildings but significant enough to be felt by those in the area.

To be sure, natural earthquakes have always far outnumbered human-caused quakes in California – but the researchers warned that even if the number of industry-caused quakes is small, wastewater injection could be responsible for larger, more dangerous quakes in the future.

“Based on our empirical results, injection-induced earthquakes are expected to contribute marginally to the overall seismicity in California,” the researchers from the California Institute of Technology, University of California, University of Southern California and two French universities, wrote. “However, considering the numerous active faults in California, the seismogenic consequences of even a few induced cases can be devastating.”

The researchers also warned that the number of California quakes tied to oilfield activities has been little-studied compared to other parts of the country and that natural quakes may have “masked” the oil industry’s impacts.

…click on the above link to read the rest of the article…

Why the Wild Descent of Oil Is Cause for Concern

Why the Wild Descent of Oil Is Cause for Concern

Low prices once signalled good news for the global economy. Not this time.

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Global markets now behave like digital roller-coasters from China to Europe. Oil photo via Shutterstock.

The signs of oil’s madcap price collapse are everywhere.

Global markets now behave like digital roller-coasters from China to Europe.

Schlumberger, the largest oil field service firm, cut 10,000 jobs in 2016 and another 20,000 jobs last year. The champion of hydraulic fracturing posted a loss of $1 billion, too.

Throughout the world’s financial pages, economists have adopted a new noun: stagnation, stagnation and stagnation.

In Aberdeen, Scotland, former oil workers line up at food banks.

In Fort McMurray, Canada’s oilsands mining centre, Nexen shut down a 50,000 barrel a day facility — a dramatic first. Dogged by wonky technology and a recent explosion, the Long Lake steam plant consistently failed to reach production targets (70,000 a day). It extracted some of the world’s dirtiest oil.

In the U.S., scores of energy companies dependent on fracking have gone bankrupt.

Every continental petro-state — Alaska, Alberta, Colorado, Wyoming, Texas and Louisiana, North Dakota and many others — has now declared extreme budgetary shortfalls due to huge drops in oil and gas revenue.

The International Energy Agency predicts “the oil market could drown in oversupply” in 2016.

And so, the descent of oil has become a sort of Sherman’s March on globalization.

The status-quo pundits say don’t worry. The world is awash in oil due to the brute force of fracking and Alberta’s faltering bitumen boom.

…click on the above link to read the rest of the article…

Former Chesapeake Energy CEO Aubrey McClendon Bringing Fracking to Argentina

Former Chesapeake Energy CEO Aubrey McClendon Bringing Fracking to Argentina

Aubrey McClendon, the embattled former CEO and co-founder of Chesapeake Energy, has announced his entrance into Argentina to begin hydraulic fracturing (“fracking”) in the country’s Vaca Muerta Shale basin.

Though he retired as Chesapeake Energy’s CEO back in 2013 in the aftermath of a shareholder revolt, McClendon wasted little time in creating a new company called American Energy Partners (AEP). AEP, like Chesapeake, has found itself mired since its onset in legal snafus over its treatment of landowners. With AEPnot getting a red carpet roll-out in the U.S., McClendon has looked southward for other lucrative business adventures.

DeSmog reported in September that McClendon has also teamed up with a private equity company affiliated with former Mexican president Vicente Fox to begin tapping into Mexico’s portion of the Eagle Ford Shale basin. We also reported that he has begun doing business in Australia.

All of those countries have something in common that makes them different from the U.S.:  lax royalty and land deal laws.

As McClendon boasted in an investor call — and as Chesapeake formerly acknowledged on a portion of its websitesince taken down — the company chose the land grab as a key part of its business model.

Mexico, Australia and Argentina are still in the “land grab” phase of development, with zero production scale fracking taking place in any of the three countries.

AEP attempts to preempt “land grab” charges on its website.

“We work hard to earn – and maintain – your trust,” writes AEP. “We practice open, honest communication with our owner partners to strengthen those partnerships forged in mutual trust.”

Banana Republic Land Laws

In Mexico, unlike in the U.S. in which in most states’ landowners own the minerals underneath their land, the government maintains mineral rights. The same goes for Australia.

…click on the above link to read the rest of the article…

Schlumberger’s Terrifying Moment Of Truth About The US Energy Sector

Schlumberger’s Terrifying Moment Of Truth About The US Energy Sector

Having laid off 10,000 employees (and boosted his share buyback program by $10 billion – because that has worked out so well in the past), it appears Schlumberger CEO Paal Kibsgaard unleashes some very uncomfortable truthiness on his audience this morning during the earnings call, in which he revealed what likely was a wake up moment of truth for the US energy sector:
For many of our customers, available cash and annual budgets were exhausted well before the halfway point for the fourth quarter… as pricing levels for frackers has dropped into unsustainable territory.

Kibsgaard started by explaining why his firm has unveiled the massive layoffs and cost cuts:

we have faced the most severe industry downturn in 30 years

Then explained that this situation is unsustainable for American frackers…

On land in both the U.S. and Canada, the weakening activity resulted in additional commercial pressure for all product lines, and in particular in pressure pumping, where pricing levels dropped further into unsustainable territory for both operating margins and cash flow.

Which means, the pain has already started…

The burgeoning market conditions added to the pressure to the deep financial crisis throughout the oil and gas value chain and prompted operators to make further cuts to the already low EMP investment levels.

For many of our customers, available cash and annual budgets were exhausted well before the halfway point for the fourth quarter, leading to unscheduled and abrupt activity cancellations, creating an operating environment that is increasingly complex to navigate, and where the traditional year-end product and multi-client site mix sales were largely muted.

While not ready to call a bottom in the oil market for this year, Kibsgaard said he didn’t think 2017 would be worse… but then again he said that at the start of 2015 too?

Still who cares the stock price is higher… which is all that matters…

…click on the above link to read the rest of the article…

Come Listen to the Man Fracking Powers Tried to Silence

Come Listen to the Man Fracking Powers Tried to Silence

Why you should spend Thursday, Jan. 28, with Andrew Nikiforuk. A special Tyee event.

Andrew Nikiforuk

On Jan. 28, Andrew Nikiforuk has some knowledge to share.

On Jan. 28, in Vancouver, you have the opportunity to spend an evening with Andrew Nikiforuk, one the finest journalists, one of the finest minds, one the most courageous and public spirited people I have ever met.

If you are a regular reader of The Tyee you probably recognize Andrew’s byline. But you may not know of his new book on fracking in Canada with a fascinating, real-life hero at the centre of it.

You also may not know how hostile a place Canada can be for a journalist as effective as Andrew Nikiforuk.

And before you buy a ticket for the “Standing up to Fracking” Jan. 28 event, you’d probably like to know more about what will be discussed.

So I thought I’d quickly fill you in on all that here.

Andrew first met Alberta landowner and oil patch consultant Jessica Ernst in 2004 while reporting for the Globe and Mail’s Report on Business on “unconventional” energy sources — like fracked gas. It wasn’t until the next year that the harm fracking can do became personal for Ernst. She’d discovered groundwater contamination on her own land 113 kilometres northeast of Calgary, and Andrew returned to write about that for Canadian Business.

He couldn’t believe the level of fraud she had documented or how the Alberta Energy Regulator had banished all communication from her to thwart her efforts. In fact her story about pollution eerily previewed the trouble and controversy fracking would later cause across the continent.

…click on the above link to read the rest of the article…

In Supreme Court, a Battle Over Fracking and Citizens’ Rights

In Supreme Court, a Battle Over Fracking and Citizens’ Rights

Jessica Ernst’s long fight to challenge legislation putting energy regulator above the law reaches top court.

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Jessica Ernst on her land in Alberta. Photo: Colin Smith.

After years of legal wrangling, Jessica Ernst and Alberta’s powerful energy regulator finally squared off in the Supreme Court of Canada yesterday.

For almost two hours, all nine justices questioned lawyers from both sides in a case that will determine if legislation can grant government agencies blanket immunity from lawsuits based on the Charter of Rights and Freedoms.

At times the debate was so bogged down in legal jargon and little known cases that it felt as though the participants were holding a conversation in a foreign language.


STANDING UP TO FRACKING: A TYEE EVENT

Join The Tyee and acclaimed energy journalist and author Andrew Nikiforuk for a special evening on fracking. Nikiforuk will survey the latest energy battleground and discuss his new book, Slick Water, which centres around Jessica Ernst’s landmark case. The event takes place Jan. 28 in Vancouver. Find further details and ticket information here.


But the heart of the matter remained simple: Can a regulator prevent a citizen from suing it for damages when the citizen feels their charter rights have been violated?

Ernst alleges the Alberta Energy Regulator violated her rights by characterizing her as a “criminal threat” and barring all communication with her.

The claims are part of her multipronged lawsuit related to the regulation of fracking. She says fracking contaminated aquifers near her homestead near Rosebud, about 110 kilometres east of Calgary, and is seeking $33 million in damages.

…click on the above link to read the rest of the article…

Charter Rights at Issue in Fracking Supreme Court Case

Charter Rights at Issue in Fracking Supreme Court Case

Jessica Ernst’s long battle over rights, well contamination reaches highest court Tuesday.

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Jessica Ernst stands in front of Encana compressors in Rosebud, Alberta. Photo by Tor Lundberg Tuorda.

An Alberta woman’s landmark eight-year battle over fracking regulation, water contamination and Charter rights will take centre stage in the Supreme Court of Canada Tuesday.

Jessica Ernst claims fracking contaminated the water supply at her homestead near Rosebud, about 110 kilometres east of Calgary. She is seeking $33 million in damages.

Ernst is also taking on the agency that regulates the energy industry in Alberta, claiming it has denied her the right to raise her concerns effectively and is shielded by unconstitutional legislation that bar citizens from suing it for wrongdoing.

The B.C. Civil Liberties Association, the Canadian Civil Liberties Association and the David Asper Centre for Constitutional Law at the University of Toronto have intervened in support of Ernst’s position and the lawsuit could change the way the controversial technology of hydraulic fracturing is regulated in Canada.

Ernst’s lawyers hope the Supreme Court will eventually rule that the Alberta Energy Regulator violated the Charter of Rights and Freedoms by limiting her ability to communicate with the agency.

Such a decision would punt Ernst’s case back into Alberta’s courts where it can continue its slow course. Ernst considers the regulator the most at fault in her famous and multi-pronged lawsuit.

In a “factum” prepared for the Supreme Court, the B.C. Civil Liberties Association argues that immunity clauses for regulators are an affront to government accountability and a licence to abuse power.

…click on the above link to read the rest of the article…

Why The U.S. Can’t Be Called A ‘Swing Producer’

Why The U.S. Can’t Be Called A ‘Swing Producer’

They are wrong. It is preposterous to say that the world’s largest oil importer is also its swing producer.

There are two types of oil producers in the world: those who have the will and the means to affect market prices, and those who react to them. In other words, the swing producer and everyone else.

A swing producer must meet the following criteria:

• A swing producer must be a net exporter of oil.

• A swing producer must have enough daily production, spare capacity and reserves to influence market prices by balancing supply and demand through increasing or decreasing output.

• A swing producer must be able to act authoritatively and quickly to increase or decrease output.

• In the real world, a swing producer is a euphemism for a cartel. No single producer has enough oil leverage to balance the market and influence prices by itself. That includes Saudi Arabia, Russia, and the United States, the top 3 producers in the world. Obviously, it also includes U.S. tight oil.

• A swing producer must have low production costs and have the financial reserves to withstand reduced cash flow when restricting or increasing supply is necessary to balance the market.

So, let’s go down the list for OPEC and U.S. tight oil.

Related: 10 Key Energy Trends To Watch For In 2016

OPEC’s net exports for 2014 were 23 million barrels per day (mmbpd) (Figure 1). U.S. net exports were -7 mmbpd. In other words, the U.S. is a net importer of crude oil. A net importer of oil cannot be a swing producer.

Figure 1. OPEC and U.S. 2014 net crude oil exports.
Source: OPEC & Labyrinth Consulting Services, Inc.

(Click image to enlarge)

…click on the above link to read the rest of the article…

“Miracle of American Oil”: Continental Resources Courted Corporate Media to Sell Oil Exports

“Miracle of American Oil”: Continental Resources Courted Corporate Media to Sell Oil Exports

document published by the Public Relations Society of America, discovered by DeSmog, reveals that from the onset of its public relations campaign, the oil industry courted mainstream media reporters to help it sell the idea of lifting the ban on crude oil exports to the American public and policymakers.

Calling its campaign the “Miracle of American Oil,” the successful PR effort to push for Congress and the White House to lift the oil exports ban was spearheaded by Continental Resources, a company known as the “King of the Bakken” shale oil basin and founded by Harold Hamm. Hamm served as energy advisor to 2012 Republican Party presidential candidate Mitt Romney.

Miracle of American Oil

Image Credit: Public Relations Society of America

The campaign launched on December 16, 2013, the 40th anniversary of the Organization of the Petroleum Exporting Countries (OPEC) oil embargo, and won the prestigious PRSA Silver Anvil Award.

According to the document, submitted to PRSA to detail the logistics and reach of the PR effort, it was “designed to influence public policy and/or affect legislation, regulations, political activities or candidacies — at the local, state or federal government levels.”

And it all began with a kick-off dinner in Washington, D.C., hosted by Continental Resources and attended by some of the most influential mainstream media energy reporters in the United States.

Regular readers of the Washington oil and gas industry beat will find the names of the dinner attendees, disclosed in the document, familiar.

Miracle of American Oil

Image Credit: Public Relations Society of America

“The campaign not only served as a catalyst to correct public misconceptions, but it also propelled crude oil exports to the top of the U.S. Senate’s agenda,” Continental boasted on the PRSA document.

…click on the above link to read the rest of the article…

Just About Every Part of the Permian Basin is Unprofitable at $30 Per Barrel

Just About Every Part of the Permian Basin is Unprofitable at $30 Per Barrel

Sorry about that. I know that many believe that U.S. shale and tight oil plays are commercial even at current low oil prices but data on the Permian basin and Bakken plays simply does not support that belief.

To make matters worse, Pioneer and EOG have made outrageous claims about Permian basin reserves in their 3rd quarter 2015 earnings reports that no sensible person should believe. Statements like these simply add to the mistaken idea that tight oil plays get a pass on the laws of physics and economics and that somehow the U.S. is going to beat Saudi Arabia as the low-cost “swing producer” of the world. I wish that were true but trust me–based on data, that’s not going to happen.

The Permian basin is one of the oldest producing areas in the United States. It has been thoroughly drilled and is in a hyper-mature phase of development. The Spraberry, Wolfcamp and Bone Springs plays that Pioneer and EOG are pursuing (Figure 1) are really secondary recovery projects in which horizontal drilling and hydraulic fracturing have replaced water and CO2 injection methods used in the past. Few new reserves should be expected. Most of the claims that these companies make are really about higher recovery efficiency of existing reserves.

Related: The Golden Age Of Coal In China Is Over

None of these plays are remotely commercial at present oil prices. In the most-likely per-well reserve case, these plays require break-even oil prices in the range of at least $50-$75 per barrel, and current wellhead prices in the basin are less than $30 per barrel.

…click on the above link to read the rest of the article…

Oklahoma Leads The World In Seismic Activity As 2015 Quake Count Tops 5,000

Oklahoma Leads The World In Seismic Activity As 2015 Quake Count Tops 5,000

With geologists having confirmed the link between fracking and earthquakes in Oklahoma (and energy executives trying to get those geologists fired), the news this week that The Sooner State leads the world in seismic activity will likely see more uproar from residents.. and more lobbying dollars spent to ‘calm’ the politicians. As KFOR reportsthis year, more than 5,000 earthquakes have been recorded and experts say earthquakes in Oklahoma will likely increase in magnitude over time warning that it’s only a matter of time before the state gets a big one that will change life for those of living there.

“It’s unclear exactly how high we might go, and the predictions are upper 5-6 range for most things that I’ve seen,” Todd Halihan, a researcher from OSU, told KFOR NewsChannel4,

Halihan studies these quakes; his expertise is hydrogeophysics.

“Underneath any of these urban areas, whether it’s Stillwater, Cushing, Oklahoma City, Guthrie, these cities are not built to seismic standards. They’re not in L.A.” Halihan said.

“We have a lot of buildings that were built with earthquakes not even on the radar screen, so we would expect probably a fair bit of damage,” Halihan said.

“We’re not out ahead of it yet, we still have fires burning, and we’re trying to get ahead of those fires, but we’re not there yet,” Matt Skinner, spokesperson for the Oklahoma Corporation Commission, said.

“The changing point I think was the Prague quake, because as a result of that, we had a hearing as to how we should proceed in the Prague area for oil and gas exploration,” Skinner says.

Many people believe the commission is sitting back and watching the quakes happen, but they say that’s not the case.

Before…

…click on the above link to read the rest of the article…

 

Can We Afford the Future?

Can We Afford the Future?

Broken road image via shutterstock. Reproduced at Resilience.org with permission.

As a child of the 1950s I grew up immersed in a near-universal expectation of progress. Everybody expected a shiny new future; the only thing that might have prevented us from having it was nuclear war, and thankfully that hasn’t happened (so far). But, in the intervening decades, progress has begun to lose its luster. Official agencies still project economic growth as far as the eye can see, but those forecasts of a better future now ring hollow.

Why? It’s simple. We can’t afford it.

To understand why, it’s helpful to recall how the present got to be so much grander (in terms of economic activity) than the past. Much of that story has to do with fossil fuels. Everything we do requires energy, and coal, natural gas, and oil provided energy that was cheap, abundant, concentrated, and easily stored and transported. Once we figured out how to get these fuels out of the ground and use them, we went on history’s biggest joy ride.

But fossil fuels are depleting non-renewable resources, and are therefore subject to declining resource quality. Oil is the most economically important of the fossil fuels, and depletion is already eating away at expectations of further petroleum-fed progress. During the past decade, production rates for conventional oil—the stuff that fueled the economic extravaganza of the 20th century—have stalled out and are set to drop (according to the IEA’s latest forecast). Between 2004 and 2014, the oil industry’s costs for exploration and production rose at almost 11 percent per year.  The main bright spot in the oil world has been growing production of unconventional oil—specifically tight oil in North America associated with the fracking boom. But now that boom is going bust.

…click on the above link to read the rest of the article…

Fracking Regulation on Trial in Andrew Nikiforuk’s ‘Slick Water’

Fracking Regulation on Trial in Andrew Nikiforuk’s ‘Slick Water’

Ahead of Vancouver Island book tour, author surveys Canada’s latest energy battleground.

Andrew Nikiforuk, journalist

Andrew Nikiforuk’s new book, Slick Water: Fracking and One Insider’s Stand Against the World’s Most Powerful Industry, is in stores now.

Tyee readers are likely well acquainted with Jessica Ernst, the oil patch scientist and landowner defiantly challenging the regulation of fracking in Canada.

Known for standing up to one of the most powerful industries on the planet, eight years ago Ernst sued gas driller Encana and Alberta’s energy regulators, claiming contamination of the well water in her rural backyard and the failure of government authorities to investigate.

Ernst’s suit also alleges a provincial regulator breached her charter rights by refusing to communicate with her after she publicly criticized it.

Now Ernst’s story, which has earned followers on three continents, is the subject of a new book by journalist Andrew Nikiforuk, who has covered developments in Ernst’s case for this website.

Slick Water: Fracking and One Insider’s Stand Against the World’s Most Powerful Industry, published this fall by Greystone Books, blends Ernst’s compelling personal tale and long legal saga — still ongoing today — with the story of fracking and its human and environmental impacts.

It concludes Nikiforuk’s trilogy on the oil and gas industry in Alberta, which includes 2002’s Saboteurs and 2010’s Tar Sands, a winner of the Rachel Carson Environment Book Award.

In the words of New Yorker environmental journalist Elizabeth Kolbert, Slick Water is “a true-life noir filled with corruption, incompetence, and, ultimately, courage.” More specifically, Nikiforuk says, it is a story about “the courage of women.”

This Wednesday, Nov. 18, Nikiforuk embarks on a two-week book tour that will include five stops on Vancouver Island and one on Salt Spring Island. Find a full list of dates and locations in this story’s sidebar.

…click on the above link to read the rest of the article…

Battle to Keep Florida Frack-Free Heats Up

Battle to Keep Florida Frack-Free Heats Up

The battle to keep Florida frack-free is intensifying ahead of the 2016 state legislative session.

Fracking became an issue last year after Florida’s Department of Environmental Protection (DEPrevealed that the Dan A. Hughes Co. had fracked the Collier-Hogan well in Naples, despite regulators telling it not to until the agency had a chance to thoroughly review the company’s plans.

Shortly after the news broke, the move to ban fracking in Florida began.

Democratic State Senators Dwight Bullard and Darren Soto filed Senate Bill 166 that called for a statewide ban on fracking. Their bill failed, but was reintroduced this year.

In July, Bonita Springs, a city near Naples, passed a ban on all types of well-stimulation techniques, including fracking. Nearby Estero is considering a ban as well.

In a move that would void existing bans, companion legislation sponsored by Republican State Senator Garrett Richter (SB318) and Republican State Representative Ray Rodrigues (HB 191) calls for statewide regulations for fracking. The bills, if passed, would preempt all local ordinances governing the oil and gas industry.


Collier County legislative delegation on October 15 in Naples. ©2015 Julie Dermansky  

On October 15, the public had an opportunity to address a Collier County legislative delegation on the bills meant to govern the fracking industry. Senators Bullard and Richter were part of the delegation present at the Naples meeting.

Anti-fracking activists stated that nothing short of a fracking ban would protect their families from the harm the industry can cause, pointing to other states where documented incidents of negative impacts caused by fracking are stacking up.

Objections were made to the preemption of local ordinances governing oil and gas that would void Bonita’s ban and prevent other municipalities from initiating their own ban.

…click on the above link to read the rest of the article…

 

As the Fracking Boom Spreads, One Watershed Draws the Line

As the Fracking Boom Spreads, One Watershed Draws the Line

After spreading across Pennsylvania, fracking for natural gas has run into government bans in the Delaware River watershed. The basins of the Delaware and nearby Susquehanna River offer a sharp contrast between what happens in places that allow fracking and those that do not.

Over the last several years, with the hydraulic fracturing technology in hand to extract natural gas from the tight formations of the Marcellus shale, the industry moved quickly and seemingly inexorably from West Virginia and across the prized geology of Pennsylvania. State maps that designate each well with a colored dot look as if a storm of confetti has blown up from Pennsylvania’s southwest, intensifying as it reaches the state’s rural and heavily forested northeast.

Gerry Dincher/Flickr
A wellhead in north-central Pennsylvania on a platform used for drilling natural gas.

In 2008, the state produced only two percent of the country’s natural gas and the Gulf of Mexico 26 percent. By 2013 the percentages were nearly reversed: Pennsylvania produced 23 percent to the Gulf’s five percent. Now some 8,000 wells in Pennsylvania produce roughly 17 billion cubic feet of gas per day, and the expectation is that within the next decade new infrastructure will double those numbers, as well as add 60,000 miles of pipeline.

Only one area of Pennsylvania’s Marcellus has escaped the fracking storm — the portion that lies within the watershed of the Delaware River, the longest undammed river east of the Mississippi. Four years ago the gas industry was poised to spread into the Delaware River basin, which encompasses 13,000 square miles of land in four states. The industry had signed thousands of leases with watershed landowners. And although many of those landowners’ neighbors looked west at the industry’s growth in the Susquehanna River basin and wanted no part of it, the Delaware River Basin Commission (DRBC) was ready to give the go-ahead.

…click on the above link to read the rest of the article…

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