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Legal Case: White House Argues Against Considering Climate Change on Energy Projects

9:20 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

The White House

The White House

Just over a month before the United Nations convenes on September 23 in New York City to discuss climate change and activists gather for a week of action, the Obama White House Council on Environmental Quality (CEQ) argued it does not have to offer guidance to federal agencies it coordinates with to consider climate change impacts for energy decisions.

It came just a few weeks before a leaked draft copy of the Intergovernmental Panel on Climate Change’s (IPCC) latest assessment said climate disruption could cause “severe, pervasive and irreversible impacts for people and ecosystems.”

Initially filed as a February 2008 petition to CEQ by the International Center for Technology Assessment, the Sierra Club and the Natural Resources Defense Council (NRDC) when George W. Bush still served as President, it had been stalled for years.

Six and a half years later and another term into the Obama Administration, however, things have finally moved forward. Or backwards, depending on who you ask.

NEPA and CEQ

The initial February 2008 legal petition issued by the plaintiffs was rather simple: the White House’s Council for Environmental Quality (CEQ) should provide guidance to federal agencies it coordinates with to weigh climate change impacts when utilizing the National Environmental Policy Act (NEPA) on energy policy decisions.

A legal process completely skirted in recent prominent tar sands pipeline cases by both TransCanada and Enbridge, NEPA is referred to by legal scholars as the “Magna Carta” of environmental law.

CEQ oversees major tenets of environmental, energy and climate policy. It often serves as the final arbiter on many major legislative pushes proposed by Congress and federal agencies much in the same way the White House’s Office of Information and Regulatory Affairs (OIRA) does for regulatory policy.

In February 2010, Obama’s CEQ showed signs it would utilize NEPA in its policy decision-making process with regards to climate change, issuing a “Draft Guidance for Greenhouse Gas Emissions and Climate Change Impacts” and opening up a 90-day public comment period. Read the rest of this entry →

State Dept. Overseers of Contentious Enbridge Tar Sands Pipeline Workaround Have Industry, Torture Ties

1:51 pm in Uncategorized by Steve Horn

Camp Delta, Guantanamo Bay, Cuba

The Sierra Club, National Wildlife Federation (NWF) and other green groups recently revealed that pipeline giant Enbridge got U.S. State Department permission in response to its request to construct a U.S.-Canada border-crossing tar sands pipeline without earning an obligatory Presidential Permit.

Enbridge originally applied to the Obama State Department to expand capacity of its Alberta Clipper (now Line 67) pipeline in November 2012, but decided to avoid a “Keystone XL, take two” — or a years-long permitting battle — by creating a complex alternative to move nearly the same amount of diluted bitumen (“dilbit”) across the border.

The move coincides with the upcoming opening for business of Enbridge’s “Keystone XL” clone: the combination of the Alberta Clipper expansion (and now its alternative) on-ramp originating in Alberta and heading eventually to Flanagan, Ill., the Flanagan South pipeline running from Flanagan, Ill. to Cushing, Okla. and the Cushing, Okla. to Port Arthur, Texas Seaway Twin pipeline.

Together, the three pieces will do what TransCanada‘s Keystone XL hopes to do: move dilbit from Alberta’s tar sands to Port Arthur’s refinery row and, in part, the global export market.

Environmental groups have reacted with indignation to the State Department announcement published in the Federal Register on August 18. The public commenting period remains open until September 17.

Jim Murphy, senior counsel for NWF, referred to it as an “illegal scheme,” while a representative from 350.org says Enbridge has learned from the lessons of its corporate compatriot, TransCanada.

“When we blocked Keystone XL, the fossil fuel industry learned that they have a much stronger hand to play in back rooms than on the streets,” said Jason Kowalski, policy director for 350.org. “They will break the law and wreck our climate if that’s what it takes for them to make a buck.”

But as the old adage goes, it takes two to tango.

That is, influential State Department employees helped Enbridge find a way to smuggle an additional 350,000 barrels of tar sands per day across the border without public hearings or an environmental review.

Thus far, those following the issue have described the Enbridge maneuver as some sort of bureaucratic snafu.

“If anyone who’s high up in the State Department actually knew about this, they’d be up in arms,” 350.org’s Kowalski said in a recent interview with EnergyWire in reaction to State’s decision.

The reality, though, is more sordid. That is, higher-ups made this call, not just “bad apples.”

One of them has a key tie to the oil and gas industry, while the other helped lay the groundwork for the controversial “extraordinary rendition” torture program as a Bush Administration State Department attaché.

Patrick Dunn’s Industry Ties

On July 24, State Department staffer Patrick Dunn signed off on a letter rubber-stamping Enbridge’s pipeline chess move. In giving Enbridge authorization on official State Department letterhead, Dunn claimed it was not a form of authorization.

“Enbridge’s intended changes…do not require authorization from the U.S.Department of State,” Dunn wrote in the letter. “[W]e will consider [your] letter and its attachments to amend and to be part of your Presidential Permit for the capcity (sic) expansion in Line 67.”

Dunn’s letter does not give his job title, perhaps leading NWF to write him off as simply a “mid-level State Department official” in an August 25 blog post. His current position and State Department background, however, tells a different story.

February 2014 letter obtained by DeSmogBlog lists Dunn’s role as deputy office director for the Bureaus of European Affairs, the Western Hemisphere and African Affairs.

More specifically, Dunn heads up the three regions’ bureaus of energy resources, described as a “chief of staff” in an August 11 article published on Dominican Today. That article highlighted Dunn’s efforts — alongside Vice President Joe Biden — to cut deals with the Dominican Republic’s government, turning the country into an importer of gas obtained via hydraulic fracturing (“fracking”) in the U.S.

Before working his way up to the powerful Bureau of Energy Resources, Dunn helped lead numerous U.S. Embassies abroad, including in Honduras and Angola as top economic adviser, and Cape Verde as deputy embassy director.

What came before any of that, though, may go a long way in explaining how he came to oversee such an important cross-border pipeline project in the first place.

According to the Petroleum Equipment Suppliers Association (PESA), Dunn graduated in 1997 from the Association’s Foreign Service Officer Energy Industry Training Program, which is funded in part by the State Department and has a Board of Directors stuffed with oil and gas industry executives.

“PESA’s Foreign Service Officer Energy Industry Training Program was created in 1993 to increase the practical knowledge of energy attaches and economic officers with responsibility for oil and gas issues stationed in American embassies in countries where energy is a major issue,” reads a Program description.

A glance at PESA’s website demonstrates that industry executives regularly serve as presenters at the Foreign Service Officer Energy Industry Training Program.

Deborah Klepp’s Ties to Rendition, Corrupt Contracting

Though Dunn wrote the July 24 letter to Enbridge, he is not the only senior level State Department staffer overseeing the Enbridge Alberta Clipper file.

Read the rest of this entry →

Rail CEOs to Investors: “Bomb Trains” Safe At Almost Any Speed

1:04 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog 

 

A BNSF train engine heading north

Despite the dangers, BNSF is doubling down on it’s oil train shipments.

Burlington Northern Santa Fe (BNSF)recently said it would proceed with plans to increase speeds for oil-by-rail unit trains in Devil’s Lake, N.D. to 60MPH from 30 MPH, despite opposition from local officials.

BNSF’s announcement came merely a week after the Obama Administration announced its proposed regulations for trains carrying oil obtained via hydraulic fracturing (“fracking”) from North Dakota’s Bakken Shale basin.

The rail industry’s position on speed limits for “bomb trains” is simple: they continuously claim velocity has nothing to do with oil-by-rail accidents or safety.

For example, Big Rail — as revealed by DeSmogBlog — lobbied against all proposed oil train speed reductions in its dozen or so private meetings at the Obama White House before the unveiling of the proposed oil-by-rail regulations.

Recent statements by rail industry CEOs during investor calls put the heads of many companies on record opposing oil-by-rail speed limits for the first time.

Time is Money

The position of the rail companies regarding speed and safety on their recent quarterly investor calls was consistent, coming just before the release of the new oil-by-rail regulations.

“I don’t know of any incidents with crude that’s being caused by speed. We keep slowing down in this North American network over the years. We don’t get better with speed. We get worse,” E. Hunter Harrison, CEO of Canadian Pacific, stated during the company’s investor call.

“Now you can’t get growing the country for example, growing the economy, growing the population, and continue to move stuff on rail, cutting the speed back, but don’t want to add any infrastructure. That doesn’t work. That’s a timetable to disaster.”

Charles “Wick” Moorman, CEO of Norfolk Southern and also on Chevron’s Board of Directors, sang a similar tune in response to a query about excessive train speeds potentially causing crude-by-rail accidents.

The question about whether that was the case came from analyst Jason Seidl of Cowen and Company.

“None to my knowledge,” Moorman stated bluntly.

Moorman also argued on the call for a much higher speed limit.

“We’ve had a lot of discussion with the regulators and I believe that we’ll be able to make our case that a minimum speed in the 40 to 45 mile an hour range is…safe,”Moorman continued. “[A]ny significant speed restriction would be in fact disruptive to the point of almost shutting down the North American rail network.”

CSX Corporation — whose oil-by-rail train exploded in Lynchburg, Va. in April — stood in solidarity with its rail industry colleagues on its recent investor call.

“We think [30 MPH speed limits] would…severely limit our ability to provide reliable freight service to our customers,” Michael Ward, chairman, president and CEO ofCSX, stated on the company’s call.

“I would hope as we look at this with the federal government, we can show them the modeling of how disastrous that could be to the entire fluidity of the U.S. rail system as well as the adverse impact that will have as trucks deliver on to the highway system. So our view is that it would be very bad, but our view is also that cooler heads will prevail when they see the facts behind it.”

Unmentioned by Ward: CSX’s oil train that exploded in Lynchburg and spilled into the James River was rolling along at 24 MPH, below the 30 MPH limit he advocated against on the call.

“Will Cooler Heads Prevail?”

Ward is not the only insider who thinks “cooler heads will prevail” on the issue of oil-by-rail speed limits going forward.

Read the rest of this entry →

Documents: Cheniere Fuels ALEC’s New Push for Fracked Gas Exports

7:18 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Two LNG storage tanks, one labelled with Cheniere logo

Cheniere is pushing ALEC to encourage exporting of fracked gas.

Today, legislative and lobbyist members of the American Legislative Exchange Council (ALEC) voted on model legislation promoting both exports of gas obtained via hydraulic fracturing (“fracking”) and vehicles powered by compressed natural gas (CNG).

Dubbed a “corporate bill mill” by its critics, ALEC is heavily engaged in a state-level effort to attack renewable energy and grease the skids for exports of U.S. oil and gas. Today’s bills up for a vote — as conveyed in an ALEC mailer sent out on June 25 by ALEC’s Energy, Environment and Agriculture Task Force — are titled “Resolution In Support of Expanded Liquefied Natural Gas Exports“ and “Weights and Measures and Standards for Dispensing CNG and LNG Motor Fuels.”

An exclusive investigation conducted by DeSmogBlog reveals that Cheniere — the first U.S. company to receive a final liquefied natural gas (LNG) export permit by the U.S. Federal Energy Regulatory Commission (FERC) — has acted as the lead corporate backer of the LNG exports model resolution.

Further, Clean Energy Fuels Corporation, owned by energy baron T. Boone Pickens, of Pickens Plan fame, and trade associations it is a member of, served as the main pusher of the CNG model resolution.

ALEC has served as a key vehicle through which the fracking industry has curried favor and pushed for policies favorable to their bottom lines in statehouses nationwide. Now ALEC and its corporate backers have upped the ante, pushing policies that will lock in downstream demand for fracked gas for years to come.

With Cheniere becoming an ALEC dues-paying member in May 2013 and with America’s Natural Gas Alliance (ANGA) — the fracking industry’s tour de force — crowned an ALEC member in August 2013, it looks like many more fracking-friendly model bills could arise out of ALEC in the months and years ahead.

According to a document obtained by the Center for Media and Democracy, top ALEC 2014 Annual Meeting sponsors in Dallas include ANGA, ExxonMobil, Chevron, Devon Energy, and TransCanada, among others.

LNG exports will serve as the focus for part one of this series, while CNG vehicles will serve as the focus for part two.

“LNG Day”

The genesis of the Cheniere-backed model bill is tied to a March 26 “LNG Day” reception put together in Baton Rouge, La. on March 26 by the influential lobbying firm, The Picard Group.

“LNG Day gives Legislators the opportunity to learn more about the benefits of natural gas,” exclaimed a press release featuring a photo of the event taken by Dawn Cole of The Picard Group. “Attendance was great and the day was successful.”

That release was disseminated by the Louisiana Mid-Continent Oil and Gas Association, of which Cheniere is a member. Among The Picard Group’s clients: Cheniere, which it is registered to lobby for in Louisiana.

Emails obtained by DeSmogBlog under Louisiana Public Records Act reveal that Laura MacDiarmid, who works as a government and environmental affairs analyst for Cheniere, was copied on email outreach by The Picard Group to Louisiana state representatives inviting them to participate in LNG Day.

Further, “Our Energy Moment“ — the gas industry-funded propaganda campaign promoting LNG exports — put out a release of its own promoting “LNG Day.”

That release featured a quote from Jason French, listed only as a “spokesperson for the Our Energy Moment coalition” in the release. In reality, French serves as director of government and public affairs for Cheniere.

French wrote an article published in the July/August 2013 edition of “Inside ALEC” titled, “LNG Exports – A Story of American Innovation and Economic Opportunity” and also gave a presentation on LNG exports at ALEC’s 2013 Annual Meeting held in Chicago, Ill.

Via email, French confirmed with DeSmogBlog that he will also be giving a presentation at this year’s ALEC meeting in Dallas on LNG exports immediately before the model resolution promoting them receives a vote by ALEC member legislators and corporate lobbyists.

LNG Day, though, was more than a gas industry-manufactured media event. Out of it arose House Concurrent Resolution 29, co-sponsored by Speaker of The House, Rep. Chuck Kleckley and Sen. John A. Alario, Jr. (an ALEC member).

Alario, Jr. has taken significant campaign money from LNG exporters, such as ExxonMobil, Energy Transfer Partners and Sempra.

After HCR 29 passed the House under suspended rules, it also passed unanimously in a 36-0 vote in the Senate on March 25. The next evening after the lights went off on the day-time LNG Day festivities, lobbyists and legislators convened for a corporate-sponsored reception at the Jimmie Davis House.

Among the sponsors — a copy of the invitation obtained via Louisiana Public Records Act shows — were those set to benefit most from a policy of plentiful LNG exports: the frackers and the LNG exporters, such as Chesapeake Energy, ANGA, Our Energy Moment, Cheniere, Trunkline LNG, Magnolia LNG and Sempra LNG and others.

Guessing at Numbers and Figures

The language found within HCR 29 mirrors that found within the ALEC model resolution.

Read the rest of this entry →

Report: Obama Exporting Climate Change by Exporting Coal

3:40 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Greenpeace USA has released a major new report on an under-discussed part of President Barack Obama’s Climate Action Plan and his U.S. Environmental Protection Agency (EPA) carbon rule: it serves as a major endorsement of continued coal production and export to overseas markets.

Leasing Coal, Fueling Climate Change: How the federal coal leasing program undermines President Obama’s Climate Plan” tackles the dark underbelly of a rule that only polices coal downstream at the power plant level and largely ignores the upstream and global impacts of coal production at-large.

The Greenpeace report was released on the same day as a major story published by the Associated Press covering the same topic and comes a week after the release of another major report on coal exports by the Sightline Institute that sings a similar tune.

The hits keep coming: Rolling Stone’s Tim Dickinson framed what is taking place similarly in a recent piece, as did Luiza Ch. Savage of Maclean’s Magazine and Bloomberg BNA.

But back to Greenpeace. As their report points out, the main culprit for rampant coal production is the U.S. Bureau of Land Management (BLM), which leases out huge swaths of land to the coal industry. Greenpeace says this is occurring in defiance of Obama’s Climate Action Plan and have called for a moratorium on leasing public land for coal extraction.

“[S]o far, the Bureau of Land Management and Interior Department have continued to ignore the carbon pollution from leasing publicly owned coal, and have failed to pursue meaningful reform of the program,” says the report.

“Interior Secretary Sally Jewell and others in the Obama administration should take the President’s call to climate action seriously, beginning with a moratorium and comprehensive review of the federal coal leasing program, including its role in fueling the climate crisis.”

Dirty Details

Some of the numbers crunched by Greenpeace USA make the jaw drop.

For example, one chart shows the amount of coal leased by the BLM during Obama’s time in the White House. During that time, the BLM has leased off billions of tons of coal from Colorado, Montana and North Dakota, New Mexico, Utah, and Wyoming alone.

As Greenpeace points out, “This is equivalent to the annual emissions of over 825 million passenger vehicles, and more than the 3.7 billion tons that was emitted in the entire European Union in 2012.”

Further, in crunching the numbers on the social cost of carbon metrics, Greenpeace estimates producing all of this BLM-leased coal will cause between $52-$530 billion in damages.

recent major, precedent-setting federal court decision chided BLM for not taking the social cost of carbon into account in leasing out a plot of land for coal production. It remains unclear whether or not this will impact BLM’s future coal leasing activities, however.

Germany’s “Clean Break” or Greenwashing?

Interestingly and perhaps shockingly to many, much of this coal is being exported to Germany, home of what some have hailed the epicenter of the global green energy revolution. Though German coal mining is going by the wayside, imports are rising.

“German coal mining has been a dying tradition. The government will end subsidies in 2018, effectively killing it,” explained the Associated Press story.

“However, Germany is experiencing a resurgence in coal-fired power. Five German coal plants have been built since 2008, and more are coming…The result: In 2013, Germany’s emissions of carbon dioxide grew by 1.2 percent.”

Dirk Jansen, spokesman for Friends of the Earth-Germany, called the situation at-large tantamount to “greenwashing” in an interview with the Associated Press.

“Obama pretties up his own climate balance, but it doesn’t help the global climate at all if Obama’s carbon dioxide is coming out of chimneys in Germany.”

Beyond Obama, though, it raises equally troubling questions about just how “clean” Germany’s clean break will be when all is said and done.

Not Just the Atlantic: Obama Leasing Millions of Gulf Acres for Offshore Drilling

9:39 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog 

Deepwater Horizon

Deploying the age-old “Friday news dump,” President Barack Obama’s Interior Department gave the green light on Friday, July 18 to companies to deploy seismic air guns to examine the scope of Atlantic Coast offshore oil-and-gas reserves.

It is the first time in over 30 years that the oil and gas industry is permitted to do geophysical data collection along the Atlantic coast. Though decried by environmentalists, another offshore oil and gas announcement made the same week has flown under the radar: over 21 million acres of Gulf of Mexico offshore oil and gas reserves will be up for lease on August 20 in New Orleans, Louisiana at the [Mercedes-Benz] Superdome.

On July 17, the U.S. Department of Interior’s Bureau of Ocean Energy Management (BOEM)  announced the lease in the name of President Obama’s “all of the above” energy policy.

“As part of President Obama’s all-of-the-above energy strategy to continue to expand safe and responsible domestic energy production, BOEM…today announced that the bureau will offer more than 21 million acres offshore Texas for oil and gas exploration and development in a lease sale that will include all available unleased areas in the Western Gulf of Mexico Planning Area,” proclaimed a July 17 BOEM press release.

The release says this equates to upwards of 116-200 million barrels of oil and 538-938 billion cubic feet of natural gas and falls under the banner of the U.S.-Mexico Transboundary Hydrocarbon Agreement.

That Agreement was signed into law on December 26, 2013. It served as a precursor to the recently-passed Mexican oil and gas industry privatization reforms, which have opened the floodgates to international oil and gas companies to come into Mexico for onshore and offshore oil and gas exploration and production.

Tourist Hot Spots Port Isabel, South Padre Island for Sale

According to BOEM’s Proposed Notice of Sale Package, dozens of blocks sitting in close proximity to both Port Isabel and South Padre Island will be auctioned off during the August 20 lease. Both Port Isabel and South Padre Island are vacation and tourist hot spots, which were visited during a recent vacation by this writer.

(click to embiggen)

In total, an enormous 4,057 blocks of Gulf of Mexico oil and gas reserves are up for lease on August 20 in the Superdome.

Climate Action Plan?

The Obama Administration will auction off the thousands of blocks of Gulf of Mexico oil and gas leases in the midst of rolling out its Climate Action Plan, best known to some simply as the U.S. Environmental Protection Agency’s carbon rule for coal-fired power plants.

Ruled out of Obama’s Climate Action Plan, however, is any second-guessing of his “all of the above” energy policy.

While critics of the climate plan have noted the carbon rule is a full-fledged embrace of hydraulic fracturing (“fracking”) for onshore oil and gas, another undeniable truism has arisen: it’s also a full-fledged embrace of offshore drilling for oil and gas both in the Gulf — and perhaps soon in the Atlantic. Read the rest of this entry →

DeSmogBlog First to Publish North Dakota Oil-By-Rail Routes

9:40 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog 

A BNSF train engine heading north

Warren Buffett’s BNSF is a leader in moving fracked oil from North Dakota’s Bakken fields.

For the first time, DeSmogBlog has published dozens of documents obtained from the North Dakota government revealing routes and chemical composition data for oil-by-rail trains in the state carrying oil obtained via hydraulic fracturing (“fracking”) in the Bakken Shale.

The information was initially submitted to the U.S. Department of Transportation (DOT) under the legal dictates of a May 7 Emergency Order, which both the federal government and the rail industry initially argued should only be released to those with a “need-to-know” and not the public at-large.

North Dakota’s Department of Emergency Services, working in consultation with the North Dakota Office of the Attorney General, made the documents public a couple weeks after DeSmogBlog filed a June 13 North Dakota Public Records Statute request.

“There is no legal basis to protect what they have provided us at this point,” North Dakota assistant attorney general Mary Kae Kelsch said during the June 25 Department of Emergency Service’s quarterly meeting, which DeSmogBlog attended via phone. “It doesn’t meet any criteria for our state law to protect this.”

Initially, oil-by-rail giant Burlington Northern Santa Fe (BNSF) and other rail companies sent boilerplate letters — one copy of which has been obtained by DeSmogBlog from the Idaho Bureau of Homeland Security through the state’s Public Records Act — to several State Emergency Response Commissions (SERCs), arguing train routes should be kept confidential.

BNSF also sent several SERCs a boilerplate contract proposal, requesting that they exempt the information rail companies were compelled to submit to the SERCs under the DOT Emergency Order from release under Freedom of Information Act. A snippet of the proposed contract can be seen below:

Dan Wilz, homeland security division director and state security advisor of the Department of Emergency Services, said the claims did not hold legal water.

“Joe can stand on a street corner and figure that out within a week’s period,” Wilz said at the quarterly meeting. “They watch the trains go through their community each and every day.”

BNSF, Canadian Pacific Railway (CP Rail) and Northern Plains Railroad all submitted information to the Department of Emergency Services.

CP Rail: 7 Trains/Week, “Highly Flammable”

In its submission to the North Dakota Department of Emergency Services, CP Rail revealed it sent seven oil-by-rail trains through 13 counties in North Dakota the week of June 9-15. CP Rail also estimated it generally sends 2-5 trains through those same counties during an average week.

Some oil-by-rail trains, dubbed “bomb trains” by some due to their propensity to explode, carry over 2,677,500 gallons of fracked oil. The trains are often over a mile in length and contain over 100 cars.

The company also released information on the chemical composition of the Bakken oil it sends on its rail cars, conceding that Bakken oil is “highly flammable” and “easily ignited by heat, sparks or flames.”

Further, CP Rail admitted that Bakken oil has “a very low flash point” and that “water spray when fighting [its] fire may be inefficient.”

BNSF: Bakken Oil-By-Rail King

BNSF, owned by Warren Buffett — a major campaign contributor to President Barack Obama both in 2008 and 2012 and one of the richest men on the planet — is widely considered the king of oil-by-rail in the U.S. The documents BNSF released to the Department of Emergency Services back up the notion.

One document shows BNSF sent 31 oil-by-rail trains through Cass County, North Dakota during the week of May 29 – June 4, also saying it sends between 30-45 trains per week on average through the County. That same week, 30 BNSF trains zoomed through Barnes County, North Dakota.

A document filed the next week, covering June 5 – June 11, shows 45 trains passed through Cass County that week. Another 37 passed through Ward County, North Dakota and another 33 through McHenryPierce and Mountrail counties.

Northern Plains: Chemical Composition Revealed

In its DOT submission, Northern Plains included an expansive Bakken crude oil sample chemical composition test submitted by Musket Corporation, which has a terminal and transload site in North Dakota.

Read the rest of this entry →

Revealed: Heather Zichal Met with Cheniere Executives as Obama Energy Aide Before Board Nomination

9:14 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

 

Portrait of Heather Zichal

Zichal through the revolving door?

Heather Zichal, former deputy assistant for energy and climate change to President Barack Obama and nominee to sit on the board of directors of LNG export company Cheniere Energy Inc., held two meetings with Cheniere executives while working for the White House.

White House meeting logs show Zichal attended the meetings with three executives from Cheniere, owner of the Sabine Pass LNG (liquefied natural gas) export facility, the first terminal to receive a final approval from the U.S. Federal Energy Regulatory Commission (FERC) during the hydraulic fracturing (“fracking”) boom.

The meetings appear to have taken place just over two weeks apart from one another, according to the meeting logs. The first meeting was on January 14, 2013, and the second on January 29, 2013. Just over eight months later, Zichal resigned from her White House job, with Reuters citing “plans to move to a non-government job.”

Cheniere CEO Charif Souki — who is facing a major ongoing class-action lawsuit— sat in on both of those meetings. He was joined by Cheniere executives Patricia Outtrim, vice president of governmental and regulatory affairs, and Ankit Desai, vice president of government relations.

Desai, a Cheniere lobbyist, formerly worked with Zichal on U.S. Secretary of State John Kerry’s 2004 presidential campaign, serving as his budget director. Desai also formerly served as political director for then-U.S. Senator and now Vice President Joe Biden.

Zichal served as Kerry’s energy and environment policy adviser for the 2004 campaign and in 2006, became his legislative director, a job she held until becoming policy director for energy, environment and agriculture for President Barack Obama’s 2008 presidential campaign.

“Ms. Zichal served as the top energy advisor to the President of the United States at a time when Cheniere was beginning construction on [Sabine Pass LNG],” Katie Pipkin, Cheniere’s senior vice president of business development and communications told DeSmogBlog. “The meeting was simply to inform and update the administration on that project.”

Pipkin also denied that two separate meetings took place in January 2013 between Cheniere and Zichal, telling DeSmogBlog, “Our records indicate only one meeting with Zichal on the 29th.” She did not respond to repeated requests for clarification on that claim.

While at the White House, Zichal earned a salary of $140,000 per year. If elected to the Cheniere board, she will make $180,000 per year, plus own 6,000 shares of Cheniere stock.

White House Open Door for Cheniere

According to a DeSmogBlog review of White House meeting logs, between 2009 and 2013, the Obama White House held 32 meetings with Cheniere board members and lobbyists, including the two attended by Souki, Desai and Outtrim.

Together, Souki and Outtrim attended four other meetings with White House officials and eight more each, either on their own or as part of other meeting blocs.

The Obama White House door has remained open to Outtrim even though she donated $10,000 to Republicans running in the the 2014 mid-term elections, according to OpenSecrets.org. Outtrim has also co-hosted a fundraiser for U.S.Sen. John Cornyn (R-TX).

Just 10 days after Cheniere landed its final approval from FERC to export LNG from Sabine Pass on April 16, 2012, the White House hosted a meeting with Outtrim and fellow board member R. (Robert) Keith Teague.

Majida Mourad, vice president of government relations for Cheniere, also met five times with the White House.

Two of those meetings were held directly with President Barack Obama himself, one on December 4, 2011, and another on January 18, 2013. First Lady Michelle Obama also attended the second meeting.

Prior to becoming a lobbyist for Cheniere, Mourad served as a senior aide for Spencer Abraham, former secretary of energy during the first term of the Bush Administration.

“Not Uncommon”

Some wonder whether Zichal will provide Cheniere even further top-level access to the Obama Administration if elected to the company’s board.

“Heather Zichal taking a position on Cheniere’s board of directors would be another example of the revolving door between those who set energy policies and the corporations that reap financial benefits from those policies,” Emily Wurth, water program director at Food & Water Watch, told DeSmogBlog.

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Former Obama Energy Aide Named to Board of Fracked Gas Exports Giant Cheniere

11:14 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

 

Face photo of Heather Zichal

Revolving door: An Obama energy aide may join a fracking giant.

Heather Zichal, former Obama White House Deputy Assistant to the President for Energy and Climate Change, may soon walk out of the government-industry revolving door to become a member of the board of directors for fracked gas exports giant Cheniere, who nominated her to serve on the board.

The announcement, made through Cheniere’s U.S. Securities and Exchange Commission Form 8-K and its Schedule 14A, comes just as a major class-action lawsuit was filed against the board of the company by stockholders.

In reaction to the lawsuit, Cheniere has delayed its annual meeting. At that meeting, the company’s stockholders will vote on the Zichal nomination.

The class-action lawsuit was filed by plaintiff and stockholder James B. Jones, who alleges the board gave stock awards to CEO Charif Souki in defiance of both a stockholders’ vote and the company’s by-laws.

Souki — a central character in Gregory Zuckerman‘s book The Frackers — became the highest paid CEO in the U.S. as a result of the maneuver, raking in $142 million in 2013, $133 million of which came from stock awards.

Zichal was nominated to join Cheniere’s audit committee of the board, and will be paid $180,000 per year for the gig if elected.

Among the audit dommittee duties: “Prepare and review the audit committee report for inclusion in the proxy statement for the company’s annual meeting of stockholders,” which is now set for September 11 after the push-back following the filing of the stockholder class-action lawsuit.

“The audit committee’s responsibility is oversight, and it recognizes that the company’s management is responsible for preparing the company’s financial statements and complying with applicable laws and regulations,” Cheniere’s audit committee charter further explains.

Cheniere (stock symbol LNG, shorthand for “liquefied natural gas”) is currently awaiting a final decision on Corpus Christi LNG, its proposed LNG exports facility. That terminal would send gas obtained predominantly via hydraulic fracturing (“fracking”) to the global market.

The company already received the first ever final approval to export fracked gas from the U.S. Federal Energy Regulatory Commission (FERC) in April 2012 for itsSabine Pass LNG export terminal, which is scheduled to be operational by late-2015.

The nature of what role Zichal will play on the board and audit committee of the first company to make a major bet on LNG exports remains unclear. But one thing remains clear: she joins a politically well-connected cadre of Cheniere board members.

Other prominent Cheniere board members include John Deutch, former head of the U.S. Central Intelligence Agency (CIA) and Vicky Bailey, a FERC commissioner, both of whom worked for the Clinton administration.

And given Zichal’s former role as liaison between the oil and gas industry at the White House and her track record serving in that role, it raises the question: was she working for the industry all along?

Zichal Oil and Gas Services

Zichal was best known to many as the main mediator between the oil and gas industry and the White House during her time working for the Obama administration. In fact, Cheniere cites that experience as the rationale for nominating her to serve on the board.

“Zichal has extensive knowledge of the domestic and global energy markets as well as the U.S. regulatory environment,” reads the “skills and qualifications” portion of her nomination announcement on Cheniere’s Schedule 14A. “She brings a diversified perspective about the energy industry to our board having served in significant government positions during her career.” 

As Obama’s “climate czar,” Zichal headed up the effort — mandated via an April 13, 2012 Obama Executive Order — to streamline regulatory oversight of the gas industry in the U.S.

Titled, “Supporting Safe and Responsible Development of Unconventional Domestic Natural Gas Resources,” the Executive Order signed in the form of a “Friday news dump” created “a high-level, interagency working group that will facilitate…domestic natural gas development” overseen by Zichal.

Obama signed the Executive Order after meeting with Jack Gerard, head of the American Petroleum Institute (API), and other industry leaders. According to EnergyWire, API requested the creation of that working group.

“We have called on the White House to rein in these uncoordinated activities to avoid unnecessary and overlapping federal regulatory efforts and are pleased to see forward progress,” Gerard told the Associated Press in response to a question about the order.

A month later on May 15, Zichal spoke to API about her efforts and those of the Obama administration on fracking.

“It’s hard to overstate how natural gas — and our ability to access more of it than ever — has become a game-changer and that’s why it’s been a fixture of the President’s ‘All of the Above’ energy strategy,” she told API.

Just think about it: a few years ago, the conventional wisdom was that the United States would need to build more terminals to import natural gas overseas. And today, America is the world’s leading producer of natural gas and we’re actually exploring opportunities for exports.

As a May 2012 Bloomberg article explained, among Zichal’s tasks was wooing API head Jack Gerard, which she appears to have succeeded at.

Similar to the interagency working group created by the April 13, 2012, Executive Order, Zichal also oversaw the Bakken Federal Executives Group, which was created through the signing of Executive Order 13604 on March 22, 2012. That order was part of the same package that called for expedited building of the southern leg of the Keystone XL tar sands pipeline.

Executive Order 13604 created an interagency steering committee with a goal “to significantly reduce the aggregate time required to make federal permitting and review decisions on infrastructure projects while improving outcomes for communities and the environment.”

Zichal was also instrumental in legalizing the American Legislative Exchange Council‘s (ALEC) approach for fracking chemical fluid disclosure on U.S. public lands, overseen by the U.S. Department of Interior’s Bureau of Land Management.

“Zichal met more than 20 times in 2012 with industry groups and company executives lobbying on the proposed rule,” reported EnergyWire. “Among them were the American Petroleum Institute (API) and the Independent Petroleum Association of America (IPAA), along with BP America Inc., Devon Energy Corp. and Exxon Mobil Corp.”

Beyond overseeing streamlined permitting for fracking sites on both public and private lands, Zichal also oversaw the White House file for the Pavillion, Wyo., fracking groundwater contamination study.

Conducted by the U.S. Environmental Protection Agency (EPA), many believe the White House — counseled by Zichal — made a political calculus to cancel the ongoing investigation, the first of three major major studies on the subject shutdown by the EPA.

“Deeply Embedded”

The Zichal nomination is taking place alongside the deployment of the Obama Administration regulating coal-fired power plants through the U.S. Environmental Protection Agency. The rule is a de facto endorsement of fracking and gas-fired power plants as part of the “all of the above” energy policy.

As the Zichal case makes clear with regards to climate change-causing fracked gas, LNG exports flow through the revolving door in Washington, DC, and beyond.

“The fact that one of Obama’s top climate advisors is now helping expand fossil fuel use raises questions about how deeply embedded oil and gas industry interests are in the administration,” Jesse Coleman, a researcher for Greenpeace USA told DeSmogBlog.

Silent Coup: How Enbridge is Quietly Cloning the Keystone XL Tar Sands Pipeline

10:48 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog 

A Canadian flag dripping with oil

Despite activist opposition, “pipeline giant Enbridge has quietly cloned its own Keystone XL in the U.S and Canada.”

While the debate over the TransCanada Keystone XL tar sands pipeline has raged on for over half a decade, pipeline giant Enbridge has quietly cloned its own Keystone XL in the U.S and Canada.

It comes in the form of the combination of Enbridge’s Alberta Clipper (Line 67), Flanagan South and Seaway Twin pipelines.

The pipeline system does what Keystone XL and the Keystone Pipeline System at large is designed to do: ship hundreds of thousands of barrels per day of Alberta’s tar sands diluted bitumen (“dilbit”) to both Gulf Coast refineries in Port Arthur, Texas, and the global export market.

Alberta Clipper and Line 67 expansion

Alberta Clipper was approved by President Barack Obama and the U.S. State Department (legally required because it is a border-crossing pipeline like KeystoneXL) in August 2009 during congressional recess. Clipper runs from Alberta to Superior, Wis.

Initially slated to carry 450,000 barrels per day of dilbit to market, Enbridge now seeks an expansion permit from the State Department to carry up to 570,000 barrels per day, with a designed capacity of 800,000 barrels per day. It has dubbed the expansion Line 67.

As reported on previously by DeSmogBlog, Line 67 is the key connecter pipeline to Line 6A, which feeds into the BP Whiting refinery located near Chicago, Ill., in Whiting, Ind. BP Whiting — the largest in-land refinery in the U.S. — was recently retooled to refine larger amounts of tar sands under the Whiting Refinery Modernization Project. 

Line 67 also connects to Line 61 via a fork in the road of sorts in Wisconsin. From there, it heads to Flanagan, Ill., the namesake of the start of Enbridge’s Flanagan South pipeline.

Like Keystone XL, Enbridge’s Line 67 expansion project has faced unexpected delays in its State Department and Obama Administration review process.

Flanagan South also shares a key legal commonality with TransCanada’s Keystone pipeline system.

That is, like Phase II and Phase III of that system — best known to the general public as Keystone XL’s southern leg and to TransCanada as the Gulf Coast Pipeline Project — it was permitted by the U.S. Army Corps of Engineers using the controversial Nationwide Permit 12 (NWP 12) process.

As documented here on DeSmogBlog, the southern leg of Keystone XL and Flanagan South both played a central role in separate but related precedent-setting federal-level court cases.

In reviewing the legality of approval via NWP 12 through the lens of “harms,” the courts ruled in both cases that the harms of losing corporate profits for both Enbridge and TransCanada trump the potential harms of ecological damage the pipelines could cause in the future. Climate change went undiscussed in both rulings.

According to a May 2014 company newsletter, Enbridge is “on schedule to put [Flanagan South] in operation later this year.”

“After eight months of construction, we are now in the home stretch for the nearly 600-mile pipeline project,” touts the newsletter. “At the peak of construction, between October 2013 and January 2014, there were on average 3,650 construction workers over the entire route — about 1,600 of those workers from communities located along the pipeline route.”

Seaway Pipeline

In a June 16 article titled, “Blame Canada,” Reuters pointed to two new “pipes set to hit U.S. Gulf with heavy crude,” which — as it pertains to Canada — is industry vernacular for tar sands.

Flanagan South was one of the pipelines pointed to in the Reuters piece.

The other is Enbridge’s Seaway Twin pipeline, co-owned on a 50/50 joint venture basis with Enterprise Products Partners. Seaway Twin, like Keystone XL’s southern leg, runs from Cushing, Okla., to Port Arthur, Texas.

Enbridge scheduled Line 67 to go on-line in mid-2014 and reach full-capacity by mid-2015.

But, because of backlash against the proposal from environmentalists and citizens who live along the pipeline expansion’s route, the company does not expect to receive a State Department expansion permit until mid-2015.

Flanagan South Pipeline

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