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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.

Read the rest of this entry →

Judge Nixes Cove Point LNG Zoning Permit as Dominion Says Will Soon Receive Federal Permit

10:50 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Co-Written with Caroline Selle

Environmental groups fighting against the Cove Point LNG export terminal hailed Salmon’s judgment as a major grassroots victory.

An August 6 court decision handed down by Calvert County Circuit Court Judge James Salmon could put Dominion Resources’ timeline for its proposed Cove Point liquefied natural gas (LNG) export facility in jeopardy.

Salmon ruled that an ordinance exempting the Lusby, Md.-based LNGproject from local zoning laws — Ordinance 46-13 — violated both a section of a state Land Use law, as well as Maryland’s constitution. The facility will be fueled by gas obtained via hydraulic fracturing (“fracking”).

In the ruling, Judge Salmon described the zoning exemption as “a very unusual situation.” In 2013, the Calvert County Board of County Commissioners and the Calvert County Planning Commission carved out both LNG export and import facilities from zoning laws.

“To my knowledge no other municipality or county in Maryland has attempted to do what the Calvert County Board of County Commissioners has attempted to do, i.e. completely exempt two uses from being covered by zoning regulations while requiring everyone else in the County to abide by those regulations,” wrote Salmon.

Environmental groups fighting against the Cove Point LNG export terminal hailed Salmon’s judgment as a major grassroots victory.

“At a minimum, this ruling will likely cause real delay in the ability of Dominion to begin major construction of this controversial $3.8 billion fossil fuel project,” Mike Tidwell, executive director of Chesapeake Climate Action Network (CCAN), said in a press release. “The ruling should certainly give pause to the Wall Street investors that Dominion is seeking to recruit to finance this expensive, risky project.”

The plaintiffs in the lawsuit, AMP Creeks Council (shorthand for Accokeek Mattawoman Piscataway Creeks Council), came to a similar conclusion.

“This is a remarkable victory for the people of Lusby, Maryland, and folks fighting fracking and LNG exports throughout the Mid-Atlantic region,” Kelly Canavan, President of AMP Creeks Council, said in a press release.

Yet, Salmon concluded the ruling out by stating his decision “has no direct bearing on whether the facility will be built or not.” And even AMP Creeks acknowledged in its press release that its legal team “is still sorting out the implications of this ruling.”

Further, Canavan told DeSmogBlog in an interview that she agrees with Salmon, at least in terms of the legal argument he put forward about his role in the final destiny of the Cove Point LNG export facility.

“Even if he wanted to, he does not have the power to determine whether or not the facility will be built,” she said. “It doesn’t mean there won’t be a ripple effect.”

So, what gives? Is the decision a game-changer or something less? Dominion certainly thinks the latter, based on a review of its quarter two earnings call transcript.

Dominion Expects Federal Permit in “next few weeks”

During his company’s quarter two earnings call held prior to Salmon handing down the Calvert County ruling, Dominion CEO Thomas Farrell II told those listening that he expects to receive a final LNG export license from the U.S. Federal Energy Regulatory Commission (FERC) in the “next few weeks.”

“We expect to receive FERC order approving the project in the next few weeks and begin construction shortly thereafter,” Farrell said on the call. “The Cove Point Liquefaction is expected to begin operations during the fourth quarter of 2017.”

Canavan believes Farrell’s rosy prospectus appears unlikely, however.

“We obviously disagree with that, partly because if it wouldn’t delay the project to have to go through these processes, there wouldn’t have been any need to pass the ordinance in the first place,” she said.

Calvert County Board, Dominion React

In the aftermath of the ruling, Dominion made a statement, appearing to stand by its quarter two investor call. “We are reviewing the decision in detail and do not see any schedule impact,” said the company in a press release.

Meanwhile, the County Board stood by its original decision to offer Dominion a zoning exemption, saying Salmon’s ruling would be discussed at its then-upcoming August 19 meeting.

“[T]he premise behind the zoning exemption remains legitimate,” said the Board in a collective statement offered to the press. “It recognizes that review and inspection of these types of highly technical, stringently regulated projects should be conducted by experienced federal and state regulators due to the rigorous standards they must meet.”

A DeSmogBlog review of meeting minutes for that date and for the upcoming August 26 meeting shows the topic was never put on the agenda, though.

Which leaves us where we started: what’s the future of the prospective Cove Point LNG terminal? Your guess is as good as ours.

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 →

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 →

Dairyland to Petrostate: Wisconsin Oil-By-Rail Routes Published for First Time

1:51 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog 

A BNSF train engine heading north

BNSF and other rail companies are carrying dangerous oil tankers through Wisconsin.

DeSmogBlog is publishing the first documents ever obtained from the Wisconsin government revealing routes for oil-by-rail trains in the state carrying oil obtained via hydraulic fracturing (“fracking”) in the Bakken Shale basin.

The information was initially submitted to the U.S. Department of Transportation (DOT) under the auspices 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.

The Wisconsin documents show the three companies that send Bakken crude trains through the state — Burlington Northern Santa Fe (BNSF), Union Pacific and Canadian Pacific — all initially argued routes are “sensitive security information” only to be seen by those with a “need to know.”

As covered in a previous DeSmogBlog article revealing the routes of oil trains traveling through North Dakota for the first time, the rail industry used this same line of legal argument there and beyond.

Wisconsin Emergency Management did not buy the argument, though, and released the documents to DeSmogBlog through the state’s Public Records Act.

BNSF Hugs the Mississippi

As with North Dakota, BNSF is the chief mover of oil-by-rail in Wisconsin.

BNSF is owned by Warren Buffett, one of the richest men on the planet and a major campaign contributor to President Barack Obama and expected major donor for Hillary Clinton’s 2016 presidential bid.

According to the records it submitted to Wisconsin Emergency Management, BNSF moves the majority of its crude-by-rail trains along the state’s western corridor, which hugs the Mississippi River.

For the week of June 5 through June 11, records show BNSF sent 39 oil-by-rail trains through Buffalo County, La Crosse County, Pepin County, Pierce County and Trempealeau County. All of these counties border the Mississippi.

As covered here on DeSmogBlog in January, the BNSF-owned Bakken oil train that exploded in Casselton, North Dakota on December 30, 2013 was headed to a Mississippi River terminal in Missouri owned by Marquis Energy.

Canadian Pacific Hugs Lake Michigan

While BNSF dominates Wisconsin’s Mississippi River corridor, Canadian Pacific does the same — albeit to a much lesser extent — along another major body of water: Lake Michigan.

According to the data submitted by the company, Canadian Pacific ships three to five train-loads of Bakken oil per week through Milwaukee County, Racine County and Kenosha County. Canadian Pacific slices through the heart of the state in a west-to-east transit route to reach Milwaukee County.

Milwaukee, Racine and Kenosha all border Lake Michigan. And once it crosses into northeastern Illinois, the rail line sits in close proximity to Lake Michgan, particularly in Waukegan (a train line traversed many times by this writer, a Kenosha native).

Canadian Pacific owns a major rail transload facility — Great Lakes Reloading — located on the southeast side of Chicago. It sits close to both Lake Michigan and the Calumet River.

Great Lakes Reloading serves as a key thoroughfare for many of the company’s freight rail transportation routes, including for crude-by-rail.

Union Pacific: Didn’t Meet Threshold

Industry giant Union Pacific did not meet the oil-by-rail carriage threshold that requires companies to submit routes to State Emergency Response Commissions (SERCs), one of which is Wisconsin Emergency Management.

That threshold, as explained by Union Pacific in its letter to Wisconsin Emergency Management, is one million gallons of Bakken crude per week.

Union Pacific is perhaps best known to many in southeast Wisconsin and northeast Illinois for its Metra public transit line running from Kenosha to Chicago (and vice versa) and from Chicago to many Chicago-area suburbs (and vice versa).

From America’s Dairyland to Petrostate?

Read the rest of this entry →

Industry Data: Oil-By-Rail in North America Moving at Record Levels

2:15 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

A line of oil tanks on a train

A look at oil trains by the numbers.

On July 3, the Association of American Railroads (AAR) released June 2014 data showing oil-by-rail and petroleum products at-large are moving at record levels throughout North America.

The release of the data comes on the heels of the ongoing oil-by-rail nationwide week of action launched by environmental groups.

For the 26th week of 2014 (the half year point) in the U.S., 18.5% more tank cars were on the tracks carrying petroleum and/or petroleum products than last year, a total of 15,894 cars.

Examined on a year-to-date basis, 7.0% more of those same tank cars were on the tracks in the U.S. this year than last, totaling 380,961 cars to date.

Across the border in Canada, the same trend lines exist: for the 26th week of 2014, 6.9% more cars moved petroleum and/or petroleum products by rail than in the 26th week of 2013.

Looked at in terms of year-to-date compared to 2013, that totals a 7.7% increase in tank cars moving the commodity by rail.

Bomb trains,” as some critics call them, move oil obtained from hydraulic fracturing (“fracking”) in North Dakota’s Bakken Shale basin to terminals, holding facilities and markets both in the U.S. and Canada.

Hence the upsurge in unit cars carrying petroleum and/or petroleum products both north and south of the border.

Looked at through the lens of North America, 14.6% more tank cars carried petroleum and/or petroleum products during the 26th week of 2014 compared to the same time in 2013.

And 7.0% more of those tank cars have moved petroleum and/or petroleum products to market so far this year as compared to last year.

AAR: Stats Provider, Lobbying Tour De Force

Beyond crunching numbers and statistics, AAR also is a lobbying tour de force for Big Rail in the same way the American Petroleum Institute (API) is for Big Oil.

With its public relations work overseen and advised by SKDKnickerbocker — co-owned by former Obama White House communications director Anita Dunn — AARhas landed numerous meetings with the White House Office of Information and Regulatory Affairs (OIRA) in the attempt to water down crude-by-rail regulations currently being drafted by the U.S. Department of Transportation (DOT).

As revealed on DeSmogBlog, AAR members gave a presentation to OIRA on June 10 on how companies would be faced with “far reaching economic impacts” if speed limits were imposed on trains carrying oil by rail.

According to a DeSmogBlog review of federal lobbying disclosure documents, AAR has spent roughly $1.82 million on lobbying at the federal level so far in 2014.

Additionally, AAR has doled out over $150,000 in campaign contributions to congressional candidates for the 2014 electoral cycle and is also active at the state level.

Put another way, AAR’s political activism clarifies its hopes to produce more numbers and figures of the sort just unveiled in its most recent report.

But will events like the oil-by-rail week of action block such hopes and dreams?

Read the rest of this entry →

Oil-By-Rail: A Battle Between “Right to Know” & “Need to Know”

11:35 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog 

BNSF Oil Train preparing to head north.

BNSF claims their oil train routes are secrets protected by law.

Since the first major oil-by-rail explosion occurred on July 6, 2013, in Lac-Mégantic, Quebec, citizens in communities across the U.S. have risen up when they’ve learned their communities are destinations for volatile oil obtained from hydraulic fracturing (“fracking”) in North Dakota’s Bakken Shale basin.

As the old adage goes, ignorance is bliss. It’s also one of the keys to how massive oil-by-rail infrastructure was built in just a few short years — the public simply didn’t know about it.

Often, oil companies are only required to get state-level air quality permits to open a new oil-by-rail facility.

Terry Wechsler, an environmental attorney in Washington, recently explained to Reuters why there was no opposition to the first three oil-by-rail facilities in the area.

“There was no opposition to the other three proposals only because we weren’t aware they were in formal permitting,” he said

The same thing unfolded in Albany, N.Y., where there is an ongoing battle over expansion of the major oil-by-rail facility set to process tar sands crude sent by rail from Alberta. The initial permits for the oil rail transfer facility, which would allow two companies to bring in billions of gallons of oil a year, were approved with no public comment.

Oil and rail companies know well that they can proceed with their planned expansions more easily if communities remain unaware of their plans.

And now that some states — including North Dakota — have defied their efforts to keep the public in the dark about the crude-carrying trains, the public will have a much clearer idea of what’s going on.

A case in point, DeSmogBlog recently revealed crude-by-rail giant Burlington Northern Santa Fe (BNSF) moves up to 45 trains a week in some North Dakota counties and up to three dozen in others.

Big Rail’s Big Bluff

The rail industry has enjoyed a long history of legal protections, allowing it to operate in secrecy with regards to carrying hazardous materials. Indeed, Big Rail pushed hard to fight the release of information to the public on the transportation of Bakken crude oil.

This time around, the rail industry said that information it was compelled to give the federal government on its Bakken oil shipments under the U.S. Department of Transportation’s (DOT) May 7 Emergency Order could not be released to the public under state-level open records laws.

Why? Because it fell under the category of “sensitive security information.”

In boilerplate letters and contract proposals sent to heads of State Emergency Response Commissions — one of which was obtained via Idaho’s Public Records Act by DeSmogBlog — BNSF deployed this argument.

This legal designation means BNSF and other companies could withhold information regarding the movements of Bakken crude from the public — by exempting it from state-level open records laws — and would only have to release it to the emergency response commissions.

“It is important to note that this information is subject to several restrictions on its release and exemptions from both state and federal applicable Freedom of Information laws and should only be provided to persons meeting with the appropriate need-to-knows discussed below,” BNSF wrote in its boilerplate letter.

BNSF considers this information commercial confidential and business confidential information and Security Sensitive Information pursuant to Federal law, and the documents have been marked accordingly.

But despite BNSF’s legal claims, some states have released this information in response to open records requests. And the federal government has also leaned toward advocating for greater transparency.

The U.S. Transportation Security Administration (TSA) confirmed by e-mail to the Sacramento Bee that the administration did not consider this information “security sensitive,” stating, “TSA has not made a finding as to whether or not information concerning the volume of crude oil train traffic or the routes used by these trains is considered security-sensitive information.

The Federal Railroad Administration also concluded information about Bakken crude was not considered sensitive security information.

Community’s Right to Know

The U.S. Environmental Protection Agency’s website contains a section on right to know laws. That section opens by stating, “Every American has the right to know the chemicals to which they may be exposed in their daily living.”

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Meme with Wings: Are Western Anti-Fracking Activists Funded by Putin’s Russia?

1:08 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Anti-fracking banner on a march: "We Can't Drink Money"

The myth of Russian funding for anti-fracking activists keeps reappearing.

At a June 19 speaking event at London’s Chatham House, North Atlantic Treaty Organization (NATO) secretary-general Anders Fogh Rasmussen claimed the Russian government is covertly working to discredit hydraulic fracturing (“fracking”) in the west from afar.

“I have met allies who can report that Russia, as part of their sophisticated information and disinformation operations, engaged actively with so-called non-governmental organisations — environmental organizations working against shale gas — to maintain European dependence on imported Russian gas,” said Rasmussen, the former Prime Minister of Denmark.

Rasmussen’s comments were relayed to the press by someone in attendance who apparently broke the “Chatham House Rule” by telling outsiders about the content of a Chatham House meeting.

But Rasmussen left out some key context from his presentation, which he said “is my interpretation” and did not further elaborate on his “disinformation operations” comments.

That is, while powerful actors have claimed on multiple occasions that western-based anti-fracking activists are funded by the Kremlin, no one has ever documented such a relationship in the form of a money paper trail.

Meme with Wings

Rasmussen’s allegation that western “fracktivists” are or might be funded by the Kremlin is a meme with wings.

In a June 2010 email revealed by Wikileaks, private intelligence firm Stratfor (shorthand for Strategic Forecasting, Inc.) speculated that Josh Fox, director of Gasland and Gasland: Part II, might be funded by the Russian government or the coal industry. According to a January 2010 email, Stratfor’s “biggest client” is the American Petroleum Institute.

Stratfor published a white paper titled “Shale Gas Activism,” an analysis of anti-fracking opposition groups and leaders, in December 2009.

Emails show Stratfor sent the white paper to Stanley Sokul, then-ExxonMobil corporate issues senior advisor and now XTO Energy’s manager of public and government affairs. Sokul formerly served as chief of staff and general counsel for the White House Office of Science and Technology Policy under President George W. Bush.

Further, in the industry-funded documentary film FrackNation, climate change denier James Delingpole also stated that anti-fracking activists are likely funded by the Kremlin.

Most recently, climate change skeptic Bjorn Lomborg — whose Copenhagen Consensus Center was recently exposed by DeSmogBlog’s Graham Readfearn — also recently wrote that he concurred with his fellow Dane Rasmussen’s assessment.

“The accusations do not seem too far-fetched. Russia is very keen on dissuading Europe from exploiting its shale reserves,” Lomborg wrote in Forbes. “Moscow’s goal clearly is to keep the EU dependent on Russia.”

Memes Work

While in reality, U.S. oil and gas companies maintain close ties with Russia — including in the fracking sphere — the meme brought to the forefront again by Rasmussen is the one that has caught much more fire.

Originally conceptualized in scholar Richard Dawkins‘ 1976 book The Selfish Gene, one conclusion reigns supreme: memes work and can have a major impact.

For example, Occupy Wall Street’s “We are the 99-percent” is a meme. So too is “Global warming is a hoax.”

“In my opinion, the problem is not with the meme concept itself, but with some of the ways in which it has been used, and especially those that undermine the role of agency in [deploying memes],” Limor Shifman — senior lectureer at the Department of Communication and Journalism at the Hebrew University of Jerusalem and author of the book, Memes In Digital Culture — said in a recent interview on her book.

With loud megaphones and ongoing geopolitical tensions between the U.S. and Russia with no end in sight, one can rest assured Rasmussen will not be the last one to repeat this meme, just as he was not the first.

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.

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