“Crimes against our environment must be met with swift action and accountability. The carelessness of Plains All-American harmed hundreds of species and marine life off Refugio Beach. This conduct is criminal and today’s charges serve as a powerful reminder of the consequences that flow from jeopardizing the well-being of our ecosystems and public health.” California Attorney General, Kamala D. Harris
On May 16, 2016, a California Grand Jury indicted Plains All-American Pipeline on 46 criminal charges, including four felonies, from the Line 901 oil and hazardous substances spill into state water. AG Kamala said PAAP had been “less than cooperative” during the investigation. PAAP faces up to $2.8 million in fines plus additional costs and penalties. PAAP’s response was swift: it denied all charges and had the Grand Jury transcript sealed. PAAP is known in Arkansas as Diamond Pipeline and DP Pipeline. Will the Arkansas Attorney General step up and stop the line?
Welspun, the pipe supplier chosen for the Diamond pipeline, is owned by Welspun, Ltd. India’s Welspun Ltd. is currently facing two class action lawsuits by WalMart and Target for selling fake “Egyptian cotton” sheets at the price of real Egyptian cotton. Corporate culture, the way a company does business, is defined by top management. Corrupt behavior is toxic and spreads to every business transaction. In 2009, PHMSA found defective Welspun pipes in the field, stretched under pressure, creating expansion anomalies from using low-strength steel. Welspun was responsible for 88 percent of defective pipes on the Boardwalk pipelines.
Frackers build pipelines for export profiteering. The Fiscal Times report of June 6, 2016, says, “U.S. oil exports surge, near 100-year high.” U.S. crude oil exports rose to 591,000 barrels per day in April, up 83,000 barrels from March, according to new data from the U.S. Census Bureau.
Trading money for water, justice, and public health – is fracking wrong?
If you ask U.S. Senator Boozman [R-AR] why we need the Keystone XL pipeline, he will say energy independence, pipelines are the safest way to transport crude oil.” Welspun jobs are the fly in the ointment.
Energy independence has political appeal but is it a desirable goal? Boozman is not talking about sustainable distributed solar and wind power generation. Boozman wants to frack, export oil and keep Welspun in business. OSHA has reports of serious workplace safety violations and one fatality. The Arkansas Economic Development Commission says worker safety has nothing to do with the millions of incentives to lure Welspun, it is all about head count.
Pipelines are not safe. Like dogs, they come in many sizes, and they all leak. Pipeline safety is a function of the design, construction and operation of the pipeline. The Diamond Pipeline, designed, built, and operated by a corrupt company using the worst pipes, is guaranteed to spill, and when it does, Arkansans will pay with their health, water, and cleanup. DP Pipeline LLC mentioned on the Arkansas Public Service Commission application, is an Arkansas dummy corporation – it has no assets, people, or even a phone number.
Welspun, Little Rock, has 350 miles of Keystone XL pipes in their Little Rock yard manufactured in 2012. Welspun recently laid off 160 workers, knowing the $47 million order for Diamond pipes was in the works. Sales of red Rust-Oleum are up.
Stephen Lee, Diamond project manager?
The Rebuttal Arkansas Public Service Commission testimony shows Lee’s arrogance, ignorance, and incompetence. The 28-year old pipeline responsible for the PAAP California 2015 spill was due to a defective pipe with external corrosion, inspected just before the spill. Lee said the design life of the Diamond pipeline is indefinite. When asked, “What is more important than water,” Lee said, “It depends.” He did not answer the most important question, the reason brave Lakota warriors are protecting their land.
Lee has a B.S. in Mechanical Engineering, licensed to work in Texas, with no geological experience in Arkansas or Tennessee. According to the Arkansas State Board for Professional Engineers, “Any Engineer doing work in the State of Arkansas must be licensed in the State.”
Daily updates on Facebook, Stop the Diamond Pipeline!
Dr. Luis Contreras
Two Years Into Oil Slump, U.S. Shale Firms Are Ready to Pump More
Sept. 27, 2016
When oil prices began to plunge two years ago due to a global glut of crude, experts predicted U.S. shale producers would be the losers of the resulting shakeout.
But the American companies that revolutionized the oil and gas business with hydraulic fracturing and horizontal drilling are surviving the carnage largely unbowed.
Though the collapse in prices caused a wave of bankruptcies, total U.S. oil production has only fallen by about 535,000 barrels a day so far this year compared with 2015, when it averaged 9.4 million barrels, according to the latest federal data.
As the oil markets ponder where production will resume when prices pick back up, one clear answer has emerged: America. Goldman Sachs forecasts the U.S. will be pumping an additional 600,000 to 700,000 barrels of oil a day by the end of next year—making up for every drop lost in the bust.
Few predicted that in the fall of 2014, when Saudi Arabia signaled that it wouldn’t curb its output to put a floor under crude prices. Oil pundits concluded that a brutal culling would force higher-cost players known as marginal producers—a group that includes shale drillers—out of the market.
But the greatest consequence of the Saudi decision and subsequent price drop is that it has delayed costly oil megaprojects, from deep-water platforms off Angola to oil-sands mines in Canada.
Even if members of the Organization of the Petroleum Exporting Countries, which are meeting this week in Algiers, manage to strike a deal to cut oil production later this year, U.S. producers will step into that void.
“The U.S. isn’t the marginal barrel but the most flexible,” said R.T. Dukes, an analyst at Wood Mackenzie. “We’ll be the fastest to snap back.”
More than 100 North American energy producers have declared bankruptcy during this downturn, but even companies working through chapter 11 keep pumping oil and gas. Many exit bankruptcy stronger thanks to a balance sheet that has been wiped clean. SandRidge Energy Inc., which filed in May, will exit next month after erasing nearly $3.7 billion in debt.
Many shale operators are still struggling at current prices, drilling at a loss and tapping Wall Street for new infusions of cash. But the strongest producers, including EOG Resources Inc. and Continental Resources Inc., soon will be able to generate enough money to pay for new investments and dividends—as well as boost production—even at low prices, analysts say.
U.S. production began inching up in July, shortly after oil prices rebounded to $50-a-barrel territory. Producers quickly put 100 rigs back to work this summer.
The ramp-up spooked the market, sending oil prices plunging 20% back toward $40. They have recently rebounded to about $45.
The gyrations will continue for months as shale producers go back to work, said Eric Lee, an analyst at Citibank, who predicts crude will stabilize around $60 a barrel in late 2017.
Though oil storage tanks around the world are brimming, new sources will be needed soon because older oil fields decline by 5% a year and global demand continues to rise 1.2% a year. Demand will break through the 100 million barrel-a-day mark by 2020, according to the International Energy Agency.
The looming gap between supply and demand is one reason the easy money that fueled the American drilling boom hasn’t dried up, said Lewis Hart, senior vice president of corporate advisory and banking for Brown Brothers Harriman in New York.
Even as banks and other traditional lenders tighten their purse strings, alternative sources of money are cropping up, from private-equity funds to distressed-debt specialists.
“The very existence of that capital means prices are likely to be lower for longer, because it compounds the supply problem,” Mr. Hart said.
Jesse Thompson, an economist with the Federal Reserve Bank of Dallas, said this oil bust is different from the downturn that crippled American producers in the 1980s.
Back then, Saudi Arabia initially shut down production as it tried to put a floor under prices, then changed course and began selling crude into an already glutted market. By 1986, the world’s oil supply capacity was 20% higher than demand, Mr. Thompson said. He estimates that today, the world is oversupplied by about 1%.
A big reason U.S. oil production has been so resilient is that U.S. producers found ways to cut costs and enhance efficiencies during the lean years. Those innovations are now poised to propel the industry’s resurrection.
In May, Halliburton Co. helped tap the longest shale well on record—8,500 feet deep and another 18,544 feet long—for Eclipse Resources Corp. in Ohio, 130 miles south of Cleveland.
That well was fracked—the process of injecting water, chemicals and sand to coax out oil and gas—an extraordinary 124 times. Typical shale wells are fracked between 30 and 40 times, up from just nine fracks in 2011 at the start of the oil boom, according to Drillinginfo, a data provider for the energy industry.
To put that engineering feat in Manhattan perspective, that is equivalent to burrowing down to the depth of nearly five World Trade Centers at One World Trade Center, turning 90 degrees and drilling underground 3.5 miles to Grand Central station. Eclipse saved 30% by supersizing the well, said Chief Operating Officer Tom Liberatore.
The industry’s cost-cutting has been painful for many. Nearly 160,000 energy employees have been laid off around the country, according to the latest tally by Graves & Co.
Even so, plenty of companies that didn’t accumulate debt or spend beyond their means during the boom years have the resources to take advantage of financial fallout from the downturn.
Albert Huddleston, founder and managing partner of Aethon Energy, said the Dallas-based producer spent more than $600 million on distressed oil-and-gas properties from Wyoming to Louisiana since prices started to fall in 2014.
“Can you kill off shale? The answer is no,” he said.
http://www.wsj.com/articles/two-years-into-oil-slump-u-s-shale-firms-are-ready-to-pump-more-1474968601
The Tale of US Oil Exports
March 2016
On December 18, 2015, U.S. Senate, on a 65-33 vote lifted the ban on crude oil exports.
In the past few years, two important aspects of U.S. oil export equation have changed. First, it now becoming profitable for the energy industry to export U.S. crude oil. Second, US has become one of the world’s largest gross exporters of refined oil products.
There are many reasons for this new gluttony of oil production. As the cost of multiple wars without ending in sight beginning to show strain in U.S. economy and political arena, alternative means of securing energy has become a priority. As such, environmental concerns seems to taken a backseat, giving rise to greater exploration and subsequent production of oil in U.S.
Much of the increased production increase is attributed to relatively new oil extraction method known as fracking. According to Investopedia, fracking, or hydraulic fracturing, works by fracturing shale, which contains oil, using pressurized fluid consisting of water mixed with sand and chemicals. This induces shale to fracture allowing natural gas and oil to seep through and be extracted.
http://www.morethanshipping.com/the-tale-of-us-oil-export/
North Sea Succumbs to Cheap US Shale Gas
The Ineos Insight tanker is carrying the shipment, a total of 971,153 cubic feet of ethane coming from US shale fields.
The tanker is due to dock at Grangemouth, Scotland’s only crude refinery, and petrochemical plant.
Owned by Ineos, it produces most of the fuel used in the country and hosts Europe’s biggest ethane tank, with a capacity to hold 2.1 million cubic feet of gas.
North Sea Succumbs to Cheap US Shale GasIneos Grangemouth Refinery
Ineos has signed 15-year contracts with suppliers to pipe ethane from the US to export facilities on the east and Gulf coasts of America and then ship the gas across the Atlantic in a fleet of eight tankers.
So far, Norway, Portugal, and Spain have already received shale gas shipments, but this is a first for the UK.
http://www.offshorepost.com/north-sea-succumbs-cheap-us-shale-gas/
Here is the link for the Bloomberg article on Shale Gas
http://www.bloomberg.com/news/articles/2016-09-27/first-u-s-shale-gas-arrives-in-u-k-as-ethane-shipment-lands
Shale oil and gas are exports from the U.S. to many countries.
Natural Gas (methane) is shipped in liquid form as ethane.
September 17, 2016 – Bloomerg
“The tanker carrying 27,500 cubic meters (970,000 cubic feet) of ethane is the first shipment of gas produced from U.S. shale fields to arrive in Britain and is part of Ineos’s $2 billion investment to create a virtual pipeline across the Atlantic. The Ineos Insight is one of eight vessels that will deliver the fuel at the Grangemouth refinery as the North Sea supplies dwindle.”
“Increased production of ethane, which is extracted from unprocessed natural gas along with other liquids, has boosted exports from the U.S., first by pipeline to Canada and then by tanker to overseas destinations. Ethane is used as a key feedstock for plastics production and other industrial uses, according to the U.S. Energy Information Administration.”
Thinking of this pipeline as simply a cash machine, generating export revenues, explains our sad reality. Colombia and Afghanistan export deadly products to keep their economies running.
US special forces have been involved for many years in the War on Drugs. Pablo Escobar, El Chapo, and many others have been targets.
Here is an excerpt from the NY times, September 10, 2016
“For 52 years, with abundant American support, the Colombian government has been locked in a ferocious armed conflict with leftist insurgents. Though it initially empowered paramilitary forces as military proxies, the government withdrew official sanction decades later, long after landowners and cartels had co-opted them. Before their demobilization in the mid-2000s, the militiamen came to rival the guerrillas as drug traffickers and outdo them as human rights abusers.”
“Now, eight years after the paramilitaries were extradited, Colombia has reached a peace deal with their mortal enemies, the Revolutionary Armed Forces of Colombia (the FARC). Facing an Oct. 2 vote on the accord, the country is in the midst of a polarizing debate about crime and punishment for the FARC, informed by what went wrong during the paramilitary peace process. Nobody is advocating that justice be abdicated to the United States this time.”
Please join us tomorrow, Thursday Sept 29, 6:00 pm for an hour Meeting of the Minds
ECHO community center, Eureka Springs, AR