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Obama Opened Floodgates for Offshore Fracking in Recent Gulf of Mexico Lease

12:22 pm in Uncategorized by Steve Horn

An offshore oil platform glows in the dark

Is widespread offshore fracking in America’s future?

In little-noticed news arising out of a recent Gulf of Mexico offshore oil and gas lease held by the U.S. Department of Interior’s Bureau of Ocean Energy Management, the floodgates have opened for Gulf offshore hydraulic fracturing (“fracking”).

With 21.6 million acres auctioned off by the Obama Administration and 433,822 acres receiving bids, some press accounts have declared BP America — of 2010 Gulf of Mexico offshore oil spill infamy — a big winner of the auction. If true, fracking and the oil and gas services companies who perform it like Halliburton, Baker Hughes and Schlumberger came in a close second.

On the day of the sale held at the Superdome in New Orleans, Louisiana, an Associated Press article explained that many of the purchased blocks sit in the Lower Tertiary basin, coined the “final frontier of oil exploration in the Gulf of Mexico” by industry analysts.

“The Lower Tertiary is an ancient layer of the earth’s crust made of dense rock,”explained AP. ”To access the mineral resources trapped within it, hydraulic fracturing activity is projected to grow in the western Gulf of Mexico by more than 10 percent this year, according to Houston-based oilfield services company Baker Hughes Inc., which operates about a third of the world’s offshore fracking rigs.”

Unlike other Gulf oil and gas, Lower Tertiary crude is located in ultra-deepwater reservoirs, industry lingo for oil and gas located 5,000 feet — roughly a mile — or deeper under the ocean.

Just over a week before the lease, the Mexican government passed energy reform legislation that will prop open the barn door for international oil and gas companies to sign joint ventures with state-owned oil company Pemex, including in Mexico’s portion of the Gulf of Mexico.

Baker Hughes Fracks the Tertiary

The May edition of World Oil explains that Baker Hughes has lead the way in technology innovation to tap into Lower Tertiary oil and gas, described as existing within “harsh HPHT conditions,” or high pressure, high temperature conditions.

Using offshore fracking techniques, Baker Hughes has aided Petrobas in developing a test well in the Cascade offshore field. The company believes the recent Gulf acreage sale by the Obama Administration will serve as a boon for further offshore fracking in the months and years to come.

“We expect that there will be more offshore stimulation in coming years,” Douglas Stephens, president of pressure pumping at Baker Hughes, told the AP in the lease’s aftermath.

Baker Hughes maintains roughly one-third of the world’s offshore fracking operations.

Fracking as “Next Frontier for Offshore Drilling”

Two weeks before the lease, Bloomberg published an article declaring that fracking could serve as the “next frontier for offshore drilling.” That next frontier will come at a steep cost: $100 million spent per well, according to Bloomberg.

Even Halliburton, key innovator of onshore fracking technology and the force behind the “Halliburton Loophole” within the Energy Policy Act of 2005, admits offshore fracking is risky business.

“It’s the most challenging, harshest environment that we’ll be working in,” Ron Dusterhoft, an engineer at Halliburton, told Bloomberg. “You just can’t afford hiccups.”

The article further explained that the oil industry at-large, and not just Baker Hughes and its fellow oil services companies, stand to win big from the push to frack the Gulf of Mexico.

“Those expensive drilling projects are a boon for oil service providers such as Halliburton, Baker Hughes Inc. and Superior Energy Services Inc. Schlumberger Ltd., which provides offshore fracking gear for markets outside the U.S. Gulf, also stands to get new work,” Bloomberg reported.

“And producers such as Chevron Corp., Royal Dutch Shell Plc and BP Plc may reap billions of dollars in extra revenue over time as fracking helps boost crude output.”

According to lease statistics made public by BOEM, 42 of the 81 blocks of oil and gas auctioned off on August 20 sit in water depths of over 1600 meters (roughly a mile, or 5,280 feet).

“All of the Above”

BOEM press release declared the Gulf lease falls under the broad umbrella of President Obama’s “all of the above” energy policy, which critics point to as a form of climate change denial.

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New “Frackademia” Report Co-Written by “Converted Climate Skeptic” Richard Muller

11:46 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

MyFDL Editor’s Note: Read more about the Muellers on Firedoglake.

Richard Muller in class

The conservative UK-based Centre for Policy Studies recently published a study on the climate change impacts of hydraulic fracturing (“fracking”) for shale gas. The skinny: it’s yet another case study of “frackademia,” and the co-authors have a financial stake in the upstart Chinese fracking industry.

Titled “Why Every Serious Environmentalist Should Favour Fracking“ and co-authored by Richard Muller and his daughter Elizabeth “Liz” Muller, it concludes that fracking’s climate change impacts are benign, dismissing many scientific studies coming to contrary conclusions.

In an interview with DeSmogBlog, Richard Muller — a self-proclaimed “converted skeptic” on climate change — said he and Liz had originally thought of putting together this study “about two years ago.”

“We quickly realized that natural gas could be a very big player,” he said. “The reasons had to do with China and the goal of the paper is to get the environmentalists to recognize that they need to support responsible fracking.”

The ongoing debate over fracking in the UK served as the impetus behind the Centre for Policy Studies — a non-profit co-founded by former right-wing British Prime Minister Margaret Thatcher in 1974 — hosting this report on its website, according to Richard Muller.

“They asked for it because some environmentalists are currently opposing fracking in the UK, and they wanted us to share our perspective that fracking is not only essential for human health but its support can be justified for humanitarian purposes,” he said.

This isn’t the first time Liz Muller has unapologetically sung the praises of fracking and promoted bringing the practice to China. In April, she penned an op-ed in The New York Times titled, “China Must Exploit Its Shale Gas.”

The Mullers co-head the Berkeley Earth Surface Temperature (BEST), a non-profit that at one time received funding from the Koch brothers. BEST published a study in 2011 affirming that climate change is real and caused by humans.

There is an important detail buried on the last page of the Centre for Policy Studies report: Liz Muller’s position as founder and Managing Director of the China Shale Fund. One copy of the study is even published on the China Shale Fund’s website.

EDF Study, “FrackNation,” PM2.5

In their paper, the Mullers rely heavily on the recent University of Texas-Austin fracking climate change study published in October in partnership with the Environmental Defense Fund. DeSmogBlog characterized that study as another example of “frackademia,” science funded by Big Oil with accompanying results favoring the industry’s bottom line.

The Mullers’ report also cites the Koch Brothers-funded documentary “FrackNation” to dispute the veracity of fracking causing water contamination.

They also juxtapose the PM (particulate matter) 2.5-emitting Chinese coal industry (named such because the PM is less than 2.5 micrometers in diameter) with a powerful source of energy they claim does not emit PM2.5: shale gas. They do so both in the report itself and in an accompanying YouTube video.

Unmentioned is the fact that fracking has all kinds of accompanying air quality issues of its own, documented comprehensively in Earthworks’ recent report, “Reckless Endangerment While Fracking the Eagle Ford Shale.”

Also unmentioned is the issue of frac sand mining — the fine-grained cyrstaline sillica sand shot down a well to facilitate fracking - which emits immense amounts of PM2.5.

“We were not trying to make a comprehensive review of the subject. Our goal was to alert people to the fact that shale gas, if responsibly developed, can mitigate both air pollution and global warming,” Richard Muller told DeSmogBlog when asked why frac sand went undiscussed in his study. “There is nothing intrinsic about the mining of sand that means it cannot be responsibly extracted.”

China Shale Fund

Though the title of the report says nothing about China, “China” and/or “Chinese” appears 58 times in the report. BEST is also currently a partner of the non-profit organization Future 500, teaming up to bolster China’s rising tiger shale gas industry.

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