Cooling the planet

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First aid for the climate disruption

Oil and gas fracking wells in shale formations are mostly about extracting crude oil with the expectation of selling barrels of crude at $100 per barrel.

Natural gas (methane) is a byproduct of most Permian Basin operations. To shut down coal-fired power plants, natural gas was said to be a bridge fossil fuel in the transition to solar and wind energy. Fracking changed the rules. The false threat of running out of gasoline was used to justify oil wars. The real threat of running out of time to avoid a tipping point in the climate disruption by 2030 is ignored. Life would be unbearable with a 2°C increase in temperature.

Methane emissions are underestimated by the Environmental Protection Agency. A five-year study by the Environmental Defense Fund (EDF) found more than 13 million metric tons of methane emissions per year, 60 percent higher than EPA’s reports. Eliminating methane emissions is like First Aid to a hot planet

Stopping methane emissions

Unwanted methane from fracking well pads, pipeline compressors, oil refineries, and other points along the supply chain, are burned or released into the atmosphere around the clock. Flaring burns methane, creating carbon dioxide emissions, while vents release pure methane. This may sound idiotic, irresponsible, and insane – it is.

Last week in Bloomberg Report, “Permian’s flaring rises by 85% as oil boom continues,” said the amount of released methane emissions would meet the residential demand across Texas. Some frackers were paying people to take away methane. Negative prices for Permian methane are common.

Please see National Resources Defense Council’s report “Leaking Profits: The U.S. Oil and Gas Industry Can Reduce Pollution, Conserve Resources, and Make Money by Preventing Methane Waste” and EDF’s “Methane: The other important greenhouse gas.”

Production waste

The oil and gas production systems are poorly managed and full of waste. It all starts with false forecasts. The U.S. Energy Information Administration is said to be an independent statistics and analysis agency – it is not. EIA forecasts assume that more than 100% of its estimates of proven reserves plus unproven resources will be recovered before 2050. EIA goes along with the doctrine of Energy Dominance.

Case in point: Diamondback Energy is one of the oil and gas frackers in the Permian Basin, with 461,218 acres, 9,924 wells, and 992 million barrels of crude oil estimated reserves. It was founded in 2007 in Midland, Texas. All seems good but the financials show a $2 billion negative free cash flow. Free cash flow is the cash left over after a company pays its operating expenses and capital expenditures. Diamondback is in a deep hole, while investors look at potential profits of millions of barrels. Frackers keep fracking and investors keep buying shares.

Ignoring a glut of oil in the market and massive underground storage near large cities, frackers keep digging as the new wells have a short life. Global oil and gas demand are unknown. Instead, commodity prices, pipeline capacity, and the production mix of gas to oil keep frackers drilling. Waiting for the right time to pump is inconceivable.

Forecast driven systems create waste. The solution to massive flaring in the well pads is not more pipelines, trucking, or underground storage injection.

A red flag on each well would eliminate the overproduction waste. This is how demand driven Pull Systems work.

A ray of hope

The oil majors are buying smaller fracking companies. Their shareholders expect higher ethical standards. Last week Chevron announced plans to acquire Anadarko Petroleum for $33 billion. Smart companies will benefit from eliminating methane emissions and providing emission control services to others.

Rise up

I asked U.S. Rep. Bruce Westerman (R-AR), “How will you act to protect your constituents from the climate disruption?” Westerman is on record opposing flaring and venting regulations. Please follow up and ask for his support.

Oil and gas are not about keeping the lights on or the tank full. No one has gone to war to protect solar or wind energy. Wars in the Middle East or Venezuela would raise oil prices.

Dr. Luis Contreras

6 COMMENTS

  1. The Environmental Defense Fund (EDF) has a message for Congressman Bruce Westerman (AR-R):

    “Trump Administration Continues Senseless Attack on Methane Waste Standards by Eliminating BLM Rule

    EDF plans to challenge BLM’s decision to eliminate critical waste reduction standards”

    Please call Westerman’s office and ask him to protect his constituents – the climatic change is not a hoax

    Please visit EDF and see what else they are doing to save life on Earth — https://www.edf.org

    https://www.edf.org/media/trump-administration-continues-senseless-attack-methane-waste-standards-eliminating-blm-rule

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