Wednesday, July 23, 2008

Coyote Gulch outage We have problems upstreaming to our hosting service today. If you're seeing this things have cleared up. 12:52:52 PM     Energy policy: Oil and gas From The Glenwood Springs Post Independent: "EnCana, one of the largest operators in Garfield County, was also recognized with an Environmental Protection Award and the Production Partner of the Year award from the U.S. EPA Natural GasStar Program. That program "encourages companies to adopt cost-effective technologies and practices that improve operation efficiency and reduce emissions of methane," according to the COGCC. "The COGCC also recognized Chevron North America with a Water Quality Protection Award for initiating "a novel method of erosion control on a well site in La Plata County." The company incorporated a historical reserve pit as part of Chevron's storm water management plan for an existing well site, the agency said." "cc" 6:57:18 AM     John Harja: It's a simple question...Where's the water going to come from? Here's a look at the proposed development of oil shale, from The Denver Post. Coyote Gulch wonders why they choose to frame the issue along party lines. Certainly there is that divide in places but many conservatives know that oil shale is not ready for prime time and that the new BLM rules are an attempt by the administration to distract the public from the real issues around a sustainable energy policy, climate change and energy independence. From the article: Tuesday's release of draft rules for shale exploration by the Bureau of Land Management was the latest shot in the growing battle of politicians pointing fingers over $4-per-gallon gas and oil as high as $147 per barrel. Oil shale, along with drilling offshore and in the Arctic National Wildlife Refuge, is part of the solution, Republicans say. Democrats counter that none of those actions would lower energy costs in the short term and that more must be done to develop alternative energy. In the case of shale, some argue, too many uncertainties exist to move forward aggressively. "The administration is trying to set the stage for a last-minute fire sale of commercial oil-shale leases in western Colorado, despite the fact that we are still years away from knowing if the technologies for developing oil shale on a commercial scale are even viable," said Democratic Sen. Ken Salazar... In a conference call with reporters, Kempthorne said it would be 2015 before shale development produced oil. Even so, he said, that could affect gas prices by signaling to the futures market that the U.S. is ramping up domestic production. [Uh oh, Dirk Kempthorne is predicting the futures market.] For now, the Interior Department is limited in what it can do. Language inserted in a spending bill by Salazar bars the department from issuing final rules on oil-shale development. That moratorium expires Oct. 1. Kempthorne and Republicans want to prevent Salazar from extending that through 2009. Kempthorne said he plans to move swiftly if given an opening. Issuing the preliminary regulations started the clock on the final regulations, which could be published in about two months if the moratorium dies... Environmental groups that oppose oil-shale development said the 235- page BLM document with preliminary rules is unnecessary. In it, the BLM states that "currently, there is no oil-shale industry and the oil-shale extractive technology is still in its rudimentary [rudimentary!] stages." "The only benefit that could come from this would be for those seeking partisan political gain in trying to give the impression that ... this oil-shale industry has a role to play in impacting high energy prices," said Chase Huntley, policy adviser with the Wilderness Society... Shell gave a timeline for producing commercial quantities of oil that is far longer than the one suggested by Kempthorne. The company won't be ready for commercial leasing until probably 2015, Boyd said. Extraction of commercial quantities of oil, he said, will be almost a decade after that. More coverage from The Salt Lake Tribune. They write: The rules would govern lease management and royalty payments should extracting kerogen from rock for further refining into fuel ever prove economically feasible - an open question given the likelihood of carbon taxes, lack of available Colorado River water and a host of environmental protection restrictions... But even stalwart Republicans question the connection between pump prices and oil-shale development. During a news conference at the Utah Capitol earlier this month, Sen. Orrin Hatch said that while the companies hoping to develop oil shale "are our nation's energy Minutemen," they cannot bring down the price of oil today. Conservation organizations called the administration's move to develop rules a "false hope." "Instead of gambling our resources on unproven fuel sources, such as oil shale, we should invest in proven options that will reduce prices such as higher fuel economy standards, energy efficiency and renewable generation technologies," Chase Huntley, energy policy adviser for The Wilderness Society, said Tuesday. Oil shale development would require massive amounts of water that simply may not be available. In an April 8 letter to the BLM, Utah Public Lands Policy Coordination director John Harja said his office didn't understand if there were sufficient physical water, let alone water rights, "to support the scale of development contemplated and the effects this level of water demand might have on agriculture or wildlife [especially endangered fish] inhabiting lands and waters in the area." Harja said Tuesday that he had been in on meetings about the proposed rules, but that none of the issues raised in his letter were addressed. "It's a simple question," he said. "Where's the water going to come from?" Melting kerogen, a waxy substance in shale, is an old technology that poses significant threats to the environment. Kerogen can be further refined into diesel, jet fuel or naphtha. But no oil refinery in the United States currently is accepting kerogen for processing, and oil companies have indicated they are not interested in building new refineries in the country. More coverage from The Grand Junction Daily Sentinel. From the article: The embryonic oil shale industry is looking at ways it would pay royalties to the federal government in the event it ever is able to draw petroleum from rock. Politicians, meanwhile, are dueling over whether the federal government should have moved ahead on plans for shale development... Among the elements of the plan are three options for federal royalties on shale: One, a flat 5 percent royalty; two, a 5 percent royalty on initial production and a 12.5 percent royalty thereafter; or three, a sliding scale based on the market price of oil. [Coyote Gulch thinks that oil shale should be nationalized and profits dedicated to a sustainable energy policy that gets the U.S. off of fossil fuels.] "We've been pushing very strongly to have regulation proposed," said Tracy Boyd, communications and sustainability manager for Shell Exploration and Production Co.'s Unconventional Oil Division. In setting regulations, the federal government "literally will be defining the rules of the road" and establishing the guidelines under which companies can decide whether their technology is commercially feasible, Boyd said. Shell is working on three research and development leases in northwest Colorado, as well as on private property, but has said it won't make any decision on whether to seek commercial production of shale until the middle of the next decade... The BLM was free to publish a draft rule, the agency noted, because the moratorium applied only to a final rule. Sen. Wayne Allard, R-Colo., dismissed Salazar's fire-sale complaint as ridiculous because the process of rule-writing began in 2004. The oil shale industry is in its infancy, Frank Smith of the Western Colorado Congress said, citing the same finding in the draft rule itself. "We need to know what technology would be available and what technologies would impact the environment," Smith said. The federal government also needs to know how local communities, wildlife and water will be affected, he said. More coverage from The Rocky Mountain News. They write: [Governor] Ritter called the Interior Department's proposed rules for oil shale development "premature, unnecessary and irresponsible." "This is a last-ditch, irresponsible attempt by the White House to issue commercial oil-shale leases, at Colorado's expense, and will do nothing to help hard-working Americans or family-owned businesses struggling today with $4-a-gallon gas," Ritter said. "These regulations would set bargain basement royalty rates that could cost Coloradans billions of dollars."[...] [U.S. Senator Ken] Salazar promised to find a way to extend a congressional moratorium, which expires Sept. 30 at the end of the current fiscal year... Republican Sen. Wayne Allard said: "You've heard false claims that the department is under a 'frenzied rush' to 'organize a fire sale' of development leases. It is ridiculous to consider the multiyear effort, started in 2004 that included congressional debate and the passage of a proposal, years of planning, studies, R&D and a draft environmental impact statement issued last December, as 'frenzied.' " "It's flat wrong to claim that western communities are being asked to stand aside to accommodate this 'fire sale,' " he added. "The truth is western communities understand both the potential and the realities of the oil shale resource in their backyard."[...] Chris [Treece], director of external affairs for the Colorado River Water Conservation District in Glenwood Springs, said any oil shale development is likely decades away, despite the proposed rules. He said he hopes that if the oil companies move forward with oil shale production, they can work with the state to ensure that its remaining water supplies are developed responsibly and in a way that would benefit people, the environment and industry. More Coyote Gulch coverage here. "cc" 6:46:43 AM

© Copyright 2009 John Orr. Last update: 3/15/09; 3:40:23 PM. This theme is based on the SoundWaves (blue) Manila theme.