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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 →

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 →

Explosive Virginia Train Carried Fracked Bakken Oil, Headed to Potential Export Facility

10:34 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Platts confirmed CSX Corporation’s train that exploded in Lynchburg, Virginia was carrying sweet crude obtained via hydraulic fracturing (“fracking”) in North Dakota’s Bakken Shale basin. CSXCEO Michael Ward has also confirmed this to Bloomberg.

“Trade sources said the train was carrying Bakken crude from North Dakota and was headed to Plains All American’s terminal in Yorktown,”Platts explained. “The Yorktown facility can unload 130,000 b/d of crude and is located on the site of Plains oil product terminal.”

In January, the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration issued a Safety Alert concluding Bakken crude is more flammable than heavier oils. Hence the term “bomb trains.”

At least 50,000 gallons of the oil headed to Yorktown is now missing, according to ABC 13 in Lynchburg. Some of it has spilled into the James River, as previously reported on DeSmogBlog.

map available on CSX’s website displaying the routes for its crude-by-rail trains offers a clear indication of where the train was headed.

Formerly a refinery owned by Standard Oil and then BP/Amoco, Plains All American has turned the Yorktown refinery into a mega holding facility.

Yorktown may become a key future site for crude oil exports if the ban on exports of oil produced domestically in the U.S. is lifted.

Yorktown: Future Oil Export Mecca?

In February, Plains CEO Greg Armstrong said on the company’s quarter four earnings call that Yorktown is ideally situated geographically to become an oil export mecca if the ban is lifted.

When asked by an analyst from Bank of America about the ongoing debate over lifting the crude oil export ban, Armstrong discussed how Plains could stand to profit from exports.

“Ultimately we’re positioned, we think well for either answer if they allow blanket exports we have assets in the right places that can help build that market niche,” said Anderson.

Harry Pefanis, President and COO for Plains, sang a similar tune to Anderson.

“I guess if I also just add to that if there was export…we’ve got couple of locations that we could load ocean-going vessels. Yorktown is a location where we can rail-in and load out an ocean-going vessel,” Pefanis explained.

The industry lobbying effort to lift the U.S.-produced oil export ban has picked up major steam in 2014, with the geopolitical crisis in Ukraine and Russia serving as the hook.

Keystone XL Connection

It’s only a matter of time until the familiar oil industry overture begins. That is, pointing to the Lynchburg disaster as the reason why the northern leg of TransCanada’s Keystone XL tar sands pipeline must be built.

Read the rest of this entry →

Joe Biden Turns Fracking Missionary On Ukraine Trip

1:39 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog 

Caricature of Joe Biden

Joe Biden: Global fracking evangelist.

During his two-day visit this week to Kiev, Ukraine, Vice President Joe Biden unfurled President Barack Obama’s “U.S.Crisis Support Package for Ukraine.”

A key part of the package involves promoting the deployment of hydraulic fracturing (“fracking”) in Ukraine. Dean Neu, professor of accounting at York University in Toronto, describes this phenomenon in his book “Doing Missionary Work.” And in this case, it involves the U.S. acting as a modern-day missionary to spread the gospel of fracking to further its own interests.

With the ongoing Russian occupation of Crimea serving as the backdrop for the trip, Biden made Vladimir Putin’s Russia and its dominance of the global gas market one of the centerpieces of a key speech he gave while in Kiev.

“And as you attempt to pursue energy security, there’s no reason why you cannot be energy secure. I mean there isn’t. It will take time. It takes some difficult decisions, but it’s collectively within your power and the power of Europe and the United States,” Biden said.

“And we stand ready to assist you in reaching that. Imagine where you’d be today if you were able to tell Russia: Keep your gas. It would be a very different world you’d be facing today.”

The U.S. oil and gas industry has long lobbied to “weaponize” its fracking prowess to fend off Russian global gas market dominance. It’s done so primarily in two ways.

One way: by transforming the U.S. State Department into a global promoter of fracking via its Unconventional Gas Technical Engagement Program (formerly theGlobal Shale Gas Initiative), which is a key, albeit less talked about, part of President Obama’s “Climate Action Plan.”

The other way: by exporting U.S. fracked gas to the global market, namely EUcountries currently heavily dependent on Russia’s gas spigot.

In this sense, the crisis in Ukraine — as Naomi Klein pointed out in a recent article — has merely served as a “shock doctrine” excuse to push through plans that were already long in the making. In other words, it’s “old wine in a new bottle.”

Gas “Support Package” Details

Within the energy security section of the aid package, the White House promises in “the coming weeks, expert teams from several U.S. government agencies will travel to the region to help Ukraine meet immediate and longer term energy needs.”

That section contains three main things the U.S. will do to ensure U.S. oil and gas companies continue to profit during this geopolitical stand-off.

1) Help with pipelines and securing access to gas at the midstream level of production.

“Today, a U.S. interagency expert team arrived in Kyiv to help Ukraine secure reverse flows of natural gas from its European neighbors,” the White House fact sheet explains. “Reverse flows of natural gas will provide Ukraine with additional immediate sources of energy.”

2) Technical assistance to help boost conventional gas production in Ukraine. That is, gas obtained not from fracking and horizontal drilling, but via traditional vertical drilling.

As the White House explains, “U.S. technical experts will join with the European Bank for Reconstruction and Development and others in May to help Ukraine develop a public-private investment initiative to increase conventional gas production from existing fields to boost domestic energy supply.”

3) Shale gas missionary work.

“A technical team will also engage the government on measures that will help the Ukrainian government ensure swift and environmentally sustainable implementation of contracts signed in 2013 for shale gas development,” says the White House.

ExxonMobil Teaching Russia Fracking

Read the rest of this entry →

Keystone XL Review Extended, Delaying Final Decision Until After 2014 Elections

1:04 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

TransCanada’s northern leg of the Keystone XL tar sands pipeline will not be decided on until after the 2014 mid-term elections.

Reuters and Politico broke a major story today that TransCanada‘s northern leg of the Keystone XL tar sands pipeline will not be decided on until after the 2014 mid-term elections.

“The U.S. State Department will…extend the government comment period on the Keystone XL pipeline, likely postponing a final decision on the controversial project until after the November 4 midterm elections,” Reuters explained.

Secretary of State John Kerry and President Barack Obama have final say over whether the pipeline will be built because it crosses the U.S.-Canada border.

Reporters learned of the decision after a call between high-level congressional staff and State Department officials.

“The justification is the need to wait on continued litigation over a Nebraska court decision earlier this year, which threw part of the project’s route in doubt, two sources said today after a call between the State Department and congressional staff,” reported Politico.

In the end, the decision came down to politics, according to Politico, though there are no shortage of climate change and ecological concerns for the prospective pipeline.

“A delay past November would spare Obama a politically difficult decision on whether to approve the pipeline, angering his green base and environmentally minded campaign donors — or reject it, endangering pro-pipeline Democrats,” they reported.

Proponents and Opponents Respond

Twitter has been abuzz since rumors of the announcement started swirling and many prominent individuals with a stake in the fight have already chimed in.

“Keystone XL delay further proof that State Department has bungled this process and has no business overseeing environmental reviews,” tweeted Friends of the Earth Senior Campaigner Ross Hammond.

Bill McKibben — whose organization 350.org led the civil disobedience Tar Sands Action in summer 2011 that put the Keystone XL and tar sands on the map for many — also responded.

It’s as if our leaders simply don’t understand that climate change is happening in real time–that it would require strong, fast action to do anything about it. While we’re at it, the State Department should also request that physics delay heat-trapping operations for a while, and that the El Nino scheduled for later this spring be pushed back to after the midterms. One point is clear: without a broad and brave movement, DC would have permitted this dumb pipeline in 2011. So on we go.

Elijah Zarlin, CREDO’s senior campaign manager, said: “It is deeply disappointing that Secretary Kerry and President Obama can’t yet muster the courage to stand up to the oil industry and reject Keystone XL. Still, this is yet another defeat for TransCanada, tar sands developers like the Koch Brothers, and oil-soaked politicians. No doubt, the nearly 100,000 people who have pledged to risk arrest to stop Keystone XL played a key role in pushing the administration to more accurately consider the full impact of this project – which must clearly result in rejection. No delays will diminish our commitment to stopping Keystone XL.”

On the other side, Fox News referred to the decision as a “Friday News Dump” and the Koch Brothers-funded American Energy Alliance (AEA) tweeted, “Most had never even heard of @justinbieber back when @TransCanada applied for #KeystoneXL permits,” alluding to the fact Keystone XL has now been up for debate for five years.

Industry-funded Energy in Depth spokesman Steve Everly echoed AEA.

“It took the U.S. less than 4 years to win two theaters in World War II,” stated Everly. “It’s been five years and we can’t approve a metal pipe.”

One thing’s for certain: the prospective pipeline will likely become a major politico “hot potato” in the months leading up to the November 2014 elections. Read the rest of this entry →

BP’s Lake Michigan Spill: Did Tar Sands Spill into the Great Lake?

11:16 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog 

Is it conventional crude or tar sands? That is the question. And it’s one with high stakes, to boot.

The BP Whiting refinery in Indiana spilled between 470 and 1228 gallons of oil (or is it tar sands?) into Lake Michigan on March 24 and four days later no one really knows for sure what type of crude it was. Most signs, however, point to tar sands.

The low-hanging fruit: the refinery was recently retooled as part of its “modernization project,” which will “provide Whiting with the capability of processing up to about 85% heavy crude, versus about 20% today.”

As Natural Resources Defense Council (NRDC) Midwest Program Director Henry Henderson explained in a 2010 article, “heavy crude [is] code for tar sands.”

Albeit, “heavy crude” is produced in places other than Alberta’s tar sands, with Venezuela serving as the world’s other tar sands-producing epicenter. So, in theory, if it’s heavy crude that spilled into Lake Michigan, it could be from Venezuela.

But in practice, the facts on the ground tell a different story. As a January 2014 article in Bloomberg outlined, the combination of the U.S. hydraulic fracturing (“fracking”) boom and the Canadian tar sands boom has brought U.S. imports of Venezuelan oil to 28-year lows.

Which brings us to the next question: how does the Canadian “heavy crude” get to BP’s Whiting refinery to begin with? Enter: Enbridge’s Line 6A pipeline.

Alberta Clipper/Line 6A

Dan Goldblatt, a spokesman for the Indiana Department of Environmental Management, told DeSmogBlog he wasn’t sure what type of oil was spilled into Lake Michigan from the BP Whiting refinery  — which goes back to why it’s just being referred to as “oil” at this point by officials.

Goldblatt said the U.S. Environmental Protection Agency (EPA) will be looking into it as part of its investigation.

“Right now they’re more focused on recovery than on what type of oil it is,” Goldblatt said. “That’s a little further down the line.”

When asked about which pipeline feeds the BP Whiting refinery beast, Goldblatt told DeSmogBlog it’s Enbridge’s Line 6A pipeline.

Part of Enbridge’s “Lakehead System,” Line 6A stretches from Superior, Wis., to Enbridge’s Griffith/Hartsdale holding terminal in northwest Indiana.

“Lakehead System serves all the major refining centers in the Great Lakes … through its connection with the affiliated Canadian pipeline,” explains Enbridge’s Lakehead System website. “Total deliveries on the Lakehead System averaged 1.65 million [barrels per day] in 2009, meeting approximately … 70 percent of the refinery capacity in the greater Chicago area.”

Enbridge’s Line 67 (AKA Alberta Clipper) pipeline serves as the corridor between Alberta’s tar sands and Line 6A. Alberta Clipper currently awaits a capacity expansion permit from the U.S. State Department, which it applied for in November 2012 and needs because it’s a U.S.-Canada border-crossing line.

It was originally approved by President Barack Obama’s State Department in August 2009.

If approved, Line 67′s expansion would morph it from a 450,000 barrels per day pipeline to a 570,000 barrels per day pipeline. Its “full design capacity is 880,000 [barrels per day] of heavy crude oil,” (emphasis mine) according to theexpansion application it submitted to the State Department.

Hydrocarbon Technologies, which offers “market insight tools covering all segments of the global hydrocarbons market,” also points to the ties that bind Alberta’s tar sands, Enbridge’s Line 6A and the BP Whiting refinery.

“Once the modernisation project is complete, BP aims to increase the use of Canadian crude from oil sands via the Enbridge [Line 6A] pipeline, which runs from Alberta to Illinois,” explains Hydrocarbon Technologies.

In 2010, Line 6A spilled in a major way in Romeoville, Ill., with 6,050 barrels of oil escaping. An account in oil and gas industry trade publication PennEnergy explains the pipeline was carrying “heavy crude oil.”

“When the leak occurred, the Line 6A was transporting approximately 459,000 barrels per day of heavy crude oil,” the reporter detailed.

The “Dilbit Disaster” Connection

Line 6A is connected to the 2010 spill of over 843,000 gallons of tar sands into the Kalamazoo River, a Lake Michigan tributary. Literally.

Read the rest of this entry →

Exxon’s Russia Partnerships Challenge US Energy Weapon Narrative

4:42 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Exxon Logo

Is Exxon playing both sides in the “new cold war?”

In a long-awaited moment in a hotly contested zone currently occupied by the Russian military, Ukraine’s citizens living in the peninsula of Crimea voted overwhelmingly to become part of Russia.

Responding to the referendum, President Barack Obama and numerous U.S. officials rejected the results out of handand the Obama Administration has confirmed he will authorize economic sanctions against high-ranking Russian officials.

“As I told President Putin yesterday, the referendum in Crimea was a clear violation of Ukrainian constitutions and international law and it will not be recognized by the international community,” Obama said in a press briefing. “Today I am announcing a series of measures that will continue to increase the cost on Russia and those responsible for what is happening in Ukraine.”

But even before the vote and issuing of sanctions, numerous key U.S. officials hyped the need to expedite U.S. oil and gas exports to fend off Europe’s reliance on importing Russia’s gas bounty. In short, gas obtained via hydraulic fracturing (“fracking”) is increasingly seen as a “geopolitical tool” for U.S. power-brokers, as The New York Times explained.

Perhaps responding to the repeated calls to use gas as a “diplomatic tool,” the U.S. Department of Energy (DOE) recently announced it will sell 5 million barrels of oil from the seldom-tapped Strategic Petroleum Reserve. Both the White House and DOE deny the decision had anything to do with the situation in Ukraine.

Yet even as some say we are witnessing the beginning of a “new cold war,” few have discussed the ties binding major U.S. oil and gas companies with Russian state oil and gas companies.

The ties that bind, as well as other real logistical and economic issues complicate the narrative of exports as an “energy weapon.”

The situation in Ukraine is a simple one at face value, at least from an energy perspective.

“Control of resources and dependence on other countries is a central theme connecting the longstanding tension between Russia and Ukraine and potential actions taken by the rest of the world as the crisis escalates,” ThinkProgress explained in a recent article. “Ukraine is overwhelmingly dependent on Russia for natural gas, relying on its neighbor for 60 to 70 percent of its natural gas needs.”

At the same time, Europe also largely depends on Ukraine as a key thoroughfare for imports of Russian gas via pipelines.

“The country is crossed by a network of Soviet-era pipelines that carry Russian natural gas to many European Union member states and beyond; more than a quarter of the EU’s total gas needs were met by Russian gas, and some 80% of it came via Ukrainian pipelines,” explained The Guardian.

Given the circumstances, weaning EU countries off Russian gas seems a no-brainer at face value. Which is why it’s important to use the brain and look beneath the surface.

ExxonMobil and Rosneft

The U.S. and Russian oil and gas industries can best be described as “frenemies.” Case in point: the tight-knit relationship between U.S. multinational petrochemical giant ExxonMobil and Russian state-owned multinational petrochemical giant Rosneft.

ExxonMobil CEO Rex Tillerson sung praises about his company’s relationship with Rosneft during a June 2012 meeting with Vladimir Putin.

“I’m pleased that you were here to be part of the signing today, and very much appreciate the strong support and encouragement you have provided to our partnership,” said Tillerson. “[N]othing strengthens relationships between countries better than business enterprise.”

A year later, in June 2013, Putin awarded ExxonMobil an Order of Friendship. But what does the friendship entail?

In 2012, ExxonMobil and Rosneft signed an agreement ”to share technology and expertise” with one another. Some of the details:

In 2013, ExxonMobil and Rosneft announced a partnership to conquer the Arctic for oil and gas, creating the Arctic Research and Design Center for Continental Shelf Development.

ExxonMobil put down the first $200 million for the initial research and development work, while Rosneft threw down $250 million later. Officially, Rosneft owns 66.67 percent of the venture and ExxonMobil owns 33.33 percent.

“[S]taff will be located with the Rosneft and ExxonMobil joint venture teams in Moscow to promote resource efficiency and interaction between technical and management staffs,” explained a press release. “The [Arctic Research Center] initially will be staffed with experts from ExxonMobil and Rosneft.”

Also part of the 2013 deal, ExxonMobil gave Rosneft a 25 percent stake inAlaska’s Point Thomson natural gas field. Further, the two companies signed a Memorandum of Understanding to study the possibility of jointly building a LNG (liquefied natural gas) facility in the Russia’s far east.

Then at the end of 2013, ExxonMobil and Rosneft inked a deal to start a pilot project for tight oil reserves development in Western Siberia’s shale basins. Rosneft owns a 51 percent stake, ExxonMobil a 49 percent stake.

Tillerson recently said the ongoing events in Crimea and Ukraine at-large will have no expected impact on his company’s partnerships with Rosneft.

“There has been no impact on any of our plans or activities at this point, nor would I expect there to be any, barring governments taking steps that are beyond our control,” he said at the company’s recent annual meeting, as reported by The Wall Street Journal. “We don’t see any new challenges out of the current situation.”

“Not a U.S. Company”

In Steve Coll‘s book Private Empire: ExxonMobil and American Power, he documents that Lee Raymond — former CEO of ExxonMobil from 1993-2005 — was asked if his company would build more U.S. refineries to fend off gasoline shortages.

Raymond’s reply: “I’m not a U.S. company and I don’t make decisions based on what’s good for the U.S.”

So what does this all mean when looked at in aggregate?

Read the rest of this entry →

Dirty Details: Dents, Faulty Welds Found Along Keystone XL Southern Half in Texas

9:03 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

If an ecologically hazardous accident happens to TransCanada’s Keystone XL (KXL) tar sands pipeline, we can’t say we weren’t forewarned. That’s the latest from a press release and YouTube video recently disseminated by the good government group, Public Citizen.

Public Citizen’s Texas office explained, “Dozens of anomalies, including dents and welds, reportedly have been identified along a 60-mile stretch of the southern segment of the Keystone XL pipeline, north of the Sabine River in Texas.”

A recent report appearing in The Houston Chronicle revealed KXL’s southern half is over 75-percent complete and will be on-line by late-2013. That half of the pipeline brings tar sands – also known as diluted bitumen, or “dilbit” – from Cushing, OK (dubbed the “pipeline cross-roads of the world“) down to Port Arthur, TX, where it ends up exported to the global market.

KXL’s northern half is still in its proposal phase. Its eventual fate sits entirely in the hands of President Barack Obama and his U.S. State Department because it’s a border-crossing pipeline. In March 2012, President Obama issued an Executive Order for expediting building of KXL’s southern half.

Earlier this year, Tar Sands Blockade - a group committed to creative non-violent direct action to stop the building of KXL’s southern half – also detected defective welding in the pipeline, akin go that discovered by Public Citizen. The group did so when one of its activists went inside of the pipeline and discovered light seeping through it.

Despite this new concrete evidence from both Public Citizen and Tar Sands Blockade, the State Dept. recently denied Friends of the Earth-U.S.‘s (FOE) request to have its key Freedom of Information Act request expedited, one which would likely expose Big Oil’s influence over State’s KXL northern half decision. State argued the request doesn’t “meet any of the established criteria” for expedition, though Public Citizen’s latest spate of findings shows otherwise.

Faulty Welding: Dirt’s in the Details, Detail’s in the Dirt

An old adage goes, “the dirt’s always in the details” one digs up. So too with this latest revelation by Public Citizen - both figuratively and literally.

“Some of the new pipeline has been in the ground on some owners’ land for almost six months,” Public Citizen’s news release reads. “Landowners are concerned that this digging is indicative of faulty pipeline along the route that could potentially leak and threaten water supplies, and have requested TransCanada and the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) to provide more information about the work.”

The “dirt” in this situation was excavated not merely through landowner speculation, but straight from TransCanada’s own contractors.

“The anomalies and other problems were reported to landowners along the line…by several TransCanada vendors, including an independent inspector and a right-of-way representative,” Public Citizen further explained, also writing that each “marked section [has] a stake that reads ‘Anomaly.’”

“Anomaly” or More of the Same?

Yet, is any of this really an “anomaly”? Again, the “dirt’s in the details.”

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NY Fracking Scandal: 7 Groups Demand Conflict of Interest Investigation of Cuomo Administration

1:15 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Lawrence Schwartz, Secretary to Gov. Andrew M. Cuomo

New York could soon become the newest state in the union to allow hydraulic fracturing (fracking), the controversial technique used to enable shale oil and gas extraction. The green light from New York Governor Andrew Cuomo could transpire in as little as “a couple of weeks,” according to journalist and author Tom Wilber.  

That timeline, of course, assumes things don’t take any crazy twists or turns.

Enter a press conference today in Albany, where seven groups, including Public Citizen, Food and Water WatchFrack Action, United for ActionCatskill Citizens for Safe Energy, and Capital District Against Fracking, called for an Albany County District Attorney General investigation of the Cuomo Administration.

They are asking “whether Lawrence Schwartz, Secretary to Gov. Andrew M. Cuomo, has a conflict of interest between his stock investments and his involvement in the state’s decision on whether to allow high-volume hydraulic fracturing for shale gas.”

Schwartz – dubbed “the ringleader” of Governor Cuomo’s administration – potentially has what these groups describe as a legal conflict-of-interest. A months-long DeSmogBlog investigation reveals that Cuomo’s chief-of-staff actually has a direct financial interest in fracking going forward in New York state, potentially falling under the sphere of insider trading.  

Above and beyond Schwartz’s annual oil and gas industry stock holdings in corporations ranging from Occidental Petroleum, Williams Companies, ExxonMobil/XTO, and General Electric (GE) for the past decade, the Cuomo Administration has also held numerous meetings with lobbyists representing some of these same corporations dating back to when Cuomo assumed office in Jan. 2011, records obtained under New York’s Freedom of Information Law (FOIL) by DeSmogBlog reveal.

Dirty Details: Oil/Gas Industry Stock Holdings, Meetings with Lobbyists from Same Corporations

The details are dirty, both figuratively and literally.

A September 2012 investigation by the Environmental Working Group (EWG) examined Schwartz’s past three financial disclosure forms. That probe revealed that he had stock holdings of $1,000+ each in Occidental, Williams, Exxon/XTO, and GE in both 2010 and 2011, respectively. All four of these corporations possess a financial stake in Cuomo approving fracking in New York.

2009 saw much of the same, a year in which Schwartz had $1,000+ in his stock portfolio invested in GE, Williams, and Burlington Resources (purchasd as a subsidiary by ConocoPhillips in 2005).

DeSmogBlog followed in the footsteps of the EWG investigation by filing both an Executive Chamber FOIL request, as well a FOIL request to Schwartz’s former employer, the Westchester County Executive Office, asking for his financial disclosure forms dating back to 2002.

That latter request revealed that Schwartz has had stock holdings in the oil and gas industry dating back to 2002. At that time he was working as chief-of-staff to then-Westchester County Executive, Andrew J. Spano.

In 2002 and 2003, Schwartz had over $1,000 in stock holdings in Chevron and GE. Until 2001, Texaco – purchased in 2000 as a subsidiary by Chevron – was headquarted in Westchester. The Westchester County Executive Chamber did not possess Schwartz’s forms for 2004 or 2005.

His 2006 filings reveal $1,000 or more in his stock portfolio invested in Burlington Resources, GE, and Williams Companies.

Records obtained from Cuomo’s Executive Chamber also revealed that lobbyists from the very corporations Schwartz has thousands of dollars of stock holdings in have earned the ear of Cuomo in the form of exclusive meetings with his high-level aides.  

One case in point: Both in April 2012 and in Sept. 2012, Williams Companies lobbyists had meetings with Cuomo aides on the status of its proposed Constitution Pipeline, a joint venture between Cabot Oil and Gas, Piedmont Natural Gas and Williams Companies. That 120-mile long, 30-inch prospective pipeline, if approved, will carry gas produced in NY’s section of the Marcellus Shale to markets throughout the northeastern U.S.

The latter meeting was held between two Williams’ lobbyists – Tonio Burgos and John Charlson – and upper level Cuomo aides.

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Keystone XL Contractor and SUNY Buffalo Shale Institute Conduct LA County’s Fracking Study

12:03 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

A huge report was published on Oct. 10 by Los Angeles County that’ll likely open the floodgates for hydraulic fracturing (“fracking”) for unconventional oil and gas in the Monterey Shale basin. The report, as it turns out, was done by LA County in name only.

As the Los Angeles Times explained, the study found “no harm from the method” of fracking as it pertains to extracting shale gas and oil from the Inglewood Oil Field, which the Times explains is “the largest urban oil field in the country.”

In the opening paragraphs of his article, Ruben Vives of the Times wrote,

A long-awaited study released Wednesday says the controversial oil extraction method known as hydraulic fracturing, or fracking, would not harm the environment if used at the Inglewood Oil Field in the Baldwin Hills area.

The yearlong study included several issues raised by residents living around the field, such as the potential risks for groundwater contamination, air pollution and increased seismic activity.

It’s not until the middle of the story that Vives says the study wasn’t done by LA County itself, but rather what he describes as a “consulting firm that conducted the study” by the name of Cardno Entrix.

Cardno Entrix isn’t any ordinary “consulting firm.”

It’s the third party contractor that conducted the Environmental Impact Statement (EIS), ran the public hearings and made the website all on behalf of the Obama State Department’s review process for the controversial Keystone XL tar sands pipeline. Cardno Entrix, in turn, was hired by TransCanada to do the EIS, a conflict-of-interest blatant enough that it’s yielded an ongoing Office of the Inspector General investigation of State’s entire review process.

Study By and For Gas Industry, Connected to SUNY Buffalo Shale Resources and Society Institute

Though published under the auspices of LA County, the study wasn’t even paid for by the County at all. Rather, as Vives explained in his Times article, the oil and gas industry paid for the entire enchilada:

Plains Exploration and Production Co., the owner and operator of the oil field, paid for the review as part of a settlement agreement with Culver City and environmental and community groups. The report was reviewed by two independent firms selected by the company and Los Angeles County.

Vives never identified the “independent firms” serving as the peer reviewers, but the study itself, which contains the five-page peer review paper, reveals two reviewers: JP Martin Energy Strategy LLC and Peter Muller.

JP Martin Energy Strategy is a consulting firm run by John Martin. Martin also serves as Director of the increasingly controversial SUNY Buffalo Shale Resources and Society Institute (SRSI). He is credited with publishing “the initial research on the natural gas potential of New York’s Utica Shale that helped stimulate significant industry investment in this resource,” according to the biographical sketch on his consulting firm’s website.

Muller formerly served as a Senior Geologist for Alpha Geoscience, where from Jan. 2010-March 2012, he researched “shale gas development issues” including “flowback treatment, stray gas, [and] permitting,” according to his LinkedIn page. He now serves in a consulting capacity for various hydraulic fracturing projects for the shale gas industry.

Miller and Muller closed their five-page peer review paper by writing, “Upon review, we both feel, based on information provided us and our own experience, that the report is adequate, complete and accurate and reflected thoughtful consideration for our comments and suggestions.”

This situation parallels what DeSmog wrote about in our first ever article on the SRSI, as the “peer review” panel for its first ever study had four out of five members on the payroll of the oil and gas industry.

Stars Aligning for Shale Gas Industry’s California Dreamin’

Concerned that the Inglewood study was conducted by and for the shale gas industry, Damon Nagami of the Natural Resources Defense Council wrote, “we need additional review from independent experts who have no financial stake in the study’s outcome.” But the recent history of the Keystone XL pipeline review process shows that’s highly unlikely.

The stars, it seems, are aligning quickly in the City of Angels for the oil and gas industry, with “this area…quietly becoming the hottest potential investment in the West,” according to an August 2011 story in San Luis Obispo’s New Times, which reported that the Monterey Shale has upwards of 15 billion barrels of recoverable oil.

It’s “California Dreamin‘” for the oil and gas industry in the Monterey Shale. Will that mean a “California Nightmare” for everyone else?

Update: In an interview with DeSmogBlog, Paul Ferrazzi, Co-Founder of Citizens Coalition for a Safe Community, stated the following:

“Unfortunately, given the Settlement Agreement terms acceptable to all parties involved and the history of the implementation of the agreement by both the County and PXP one could only assume the results would be favorable to the oil operator and industry. We wish we could have some confidence in this study but given the study preparing company’s as well as the peer reviewer’s direct advocacy for the industry we do not feel it was adequately conducted, properly reviewed, or that the public should take comfort in the conclusions of the study.

If anything, this study raises more questions than it answers. The public should be able to ask for clarification and further support for the authors’ contentions. CCSC urges the County to use the study as a starting point for further discussion, and allow public participation and informative responses to test the validity, assumptions and conclusions of the study.”