Sen. Murkowski’s fresh energy plan to look beyond 2012
WASHINGTON (Reuters) – Frustrated by the gridlock that has stalled Congress leading into the 2012 presidential elections in November, the top Republican on the Senate Energy Committee is drafting what she hopes is a fresh look at the big-picture energy policy.
Details are still under wraps, but Senator Lisa Murkowski plans to unveil this summer a long-term vision with affordable energy at its core, a plan she has been working on with her staff for the past eight months.
“I want to get out front early next year and move on some energy issues. I think we’re well overdue for some real energy proposals that can give us some good clear guidance,” Murkowski told Reuters.
Murkowski, 55, relishes the prospect of setting the agenda on energy policy. She is in line to be chairman of the energy committee if Democrats lose control of the U.S. Senate, where they currently hold 53 of 100 seats.
She said her plan could eventually lead to several legislative initiatives, and will cover everything from increasing oil and gas production to improving energy efficiency to updating the transmission and storage grid.
It also aims to reduce the uncertainty in short-term incentives aimed at increasing wind and solar power, she said.
Ultimately, Murkowski believes that energy policy requires a holistic approach and she hopes her plan will act as a guiding document for action next year.
Obama administration not opposed to LNG exports
WASHINGTON, May 14 (Reuters) – The Obama administration is not opposed to exporting liquefied natural gas but will depend on an official analysis to guide its decision on whether to allow more gas export projects to proceed, a White House official said on Monday.
The Energy Department, which must approve gas exports to all but about a dozen countries, has said it will hold off on allowing any more exports until a study it commissioned on the economic impact of sending gas abroad is completed later this summer.
“We want analysis to drive the decisions,” Heather Zichal, deputy assistant to the president for energy and climate change, said at an event on shale gas energy sponsored by the American Petroleum Institute.
“As a general rule of thumb we are certainly not opposed to LNG exports,” she added.
Bolstered by massive expansion in U.S. natural gas reserves, companies such as Dominion Resources, Sempra Energy and Southern Co are now lining up to get permission to send natural gas to foreign countries.
The department had approved exports from just one project, Cheniere Energy’s Sabine Pass terminal. After that approval, the department said it would wait on the results from a study of the economic implications of exports before acting on any more applications.
Some lawmakers and manufacturers have raised concerns that allowing gas exports could raise gas prices for consumers and industry, however.
U.S. to approve major Anadarko natgas project in Utah
WASHINGTON (Reuters) – Anadarko Petroleum Corp’s plan to develop a huge natural gas field in Utah is expected to get the go-ahead from the Obama administration during a visit to the state on Tuesday by Interior Secretary Ken Salazar.
The department’s approval will allow Anadarko to move ahead with its proposal to drill about 3,700 new wells over 10 years in an existing field in Utah’s Uinta Basin.
“Extending the life of the activity in the Greater Natural Buttes area and keeping high production levels going for another decade will lead to lower energy costs and more jobs for Utahns,” Senator Orrin Hatch of Utah said in a statement.
Anadarko first proposed the Utah project in 2006, but faced some delays over air quality concerns.
Interior released a final environmental review in favor of the project in April. At the time, Anadarko said it had reached a conservation agreement with the Southern Utah Wilderness Alliance that would help protect the environment during the drilling.
“It’s really kind of a new model for prudent development,” Anadarko spokesman John Christiansen said.
The approval of the natural gas project comes on the heels of the department’s release last week of proposed new regulations for hydraulic fracturing, or fracking, in natural gas development on public lands.
US sets new rules for fracking on federal lands
WASHINGTON, May 4 (Reuters) – The Obama administration unveiled long-awaited rules on Friday to bolster oversight of “fracking” on public lands, seeking to allay environmental concerns over the technology that has spurred a boom in shale gas drilling in the United States.
The Interior Department proposal would require companies to obtain government approval to use hydraulic fracturing, or fracking, in drilling for natural gas on federal lands.
The rules would not affect drilling on private land, where the bulk of shale exploration is taking place. Still, the administration has said it hopes the rules could be used as a template for state regulators.
“Most shale plays are out of the reach of Interior,” said Whitney Stanco, an analyst with the Guggenheim Washington Research Group.
A Guggenheim analysis found that only about 5 percent of shale wells drilling in the United States in the past decade occurred on federal lands.
The proposal would also require that companies disclose the fluids used in hydraulic fracturing after completing the process, which involves injecting water, sand and chemicals under the ground to extract fuel.
“As we continue to offer millions of acres of America’s public lands for oil and gas development, it is critical that the public have full confidence that the right safety and environmental protections are in place,” Interior Secretary Ken Salazar said in a statement.
U.S. readies proposal to clamp down on fracking
WASHINGTON (Reuters) – The Obama administration wants to clamp down on shale gas drilling on public lands and set standards that proponents of tougher regulation hope will provide a blueprint for drilling oversight nationwide.
Industry sources said the Interior Department could propose a new rule on hydraulic fracturing, or fracking, as early as Friday.
The measure would require natural gas drillers to disclose chemicals they use to frack wells, a controversial process that involves injecting water, sand and chemicals deep underground to extract fuel from rock formations.
Fracking has been essential to unlocking the nation’s massive shale gas reserves, but critics argue that the practice has polluted water and hurt the environment.
The administration has said it supports shale oil and gas development, but has also called for strong oversight.
Administration officials have said they hope the rules could provide a template for states, which handle most of the regulation of fracking.
The Bureau of Land Management estimates that companies use the fracking technique on about 90 percent of wells drilled on federal lands. But only about 14 percent of U.S. natural gas production occurred on those lands in 2010.
DOE says test shows potential for natgas hydrates
WASHINGTON (Reuters) – The Energy Department on Wednesday announced a breakthrough in research into tapping a possibly vast fuel resource that could eventually bolster already massive natural gas reserves.
By injecting a mixture of carbon dioxide and nitrogen into a methane hydrate formation on Alaska’s North Slope, the department was able to produce a steady flow of natural gas in the first field test of this method. The test was done from mid-February to about mid-April this year
Methane hydrates are ice crystal-like structures that contain natural gas. The hydrates are located under the Arctic permafrost and in ocean sediments along the continental shelf.
Still, the department said it will likely be years before production of methane hydrates becomes economically viable.
“While this is just the beginning, this research could potentially yield significant new supplies of natural gas,” Energy Secretary Steven Chu said in a statement.
The department, which partnered with ConocoPhillips and Japan Oil, Gas and Metals National Corp for the test, said it will offer $6.5 million this year for further research on tapping methane hydrates, and will request an additional $5 million for research next year.
Gerald Holder, dean of the engineering program at University of Pittsburgh and who has worked with the DOE’s National Energy Technology Laboratory on the hydrate issue, said before this announcement he had been skeptical about what researchers would be able to accomplish.
US LNG exports will not cause big price spike-report
WASHINGTON, May 1 (Reuters) – U.S. exports of liquefied natural gas will not dramatically raise natural gas prices or hurt the U.S. industrial sector, a new study said, bolstering the case for supporters of sending U.S. gas abroad.
The Brookings Institution’s study said selling some of the U.S. shale gas bounty to foreign consumers would have a “modest” upward impact on domestic prices.
“Natural gas producers will likely anticipate future demand from LNG exports and will increase production accordingly, limiting price spikes,” the think tank said in its report released on Wednesday.
The future of America’s vast shale gas resources has become a source of debate in the United States, as some critics contend that allowing gas exports could raise prices for consumers and undercut a major competitive advantage for U.S. manufacturers.
Still, some shale gas drillers argue that exports are necessary to support robust domestic production, since the current glut of U.S. natural gas has sent domestic prices to 10-year lows and forced some companies to cut back on output.
The Brookings report, which analyzed the results of five major studies on the price implications of LNG exports, rebuffed arguments that exports would rebounding manufacturers.
“The competitiveness of natural-gas intensive U.S. companies relative to their counterparts is likely to remain strong, given the large differential between projected U.S. gas prices and oil prices, which are the basis for industrial feedstock by competitor countries,” the report found.
Sierra Club to fight Dominion hub using 1972 deal
WASHINGTON (Reuters) – The Sierra Club will try to use a 40-year-old legal settlement to scuttle plans by Dominion Resources Inc to convert a liquefied natural gas terminal in Maryland into a major export hub.
The environmental group, which opposes the export terminal as part of its wider fight against natural gas drilling from shale deposits, can weigh in on certain changes at the site of the proposed terminal under a 1972 legal agreement.
The Sierra Club says that under that settlement, it has a say over whether Dominion can convert an import terminal at Cove Point, near a state park, into an export plant. Dominion’s CEO disagreed with that view during a conference call with analysts on Thursday.
The Sierra Club and the Maryland Conservation Council made the deal with the then owner of the planned Cove Point terminal, just south of Calvert Cliffs State Park. Dominion, the current owner, wants to convert the facility from an import terminal to an export plant that would ship up to 1 billion cubic feet of cheap U.S. natural gas a day to foreign markets where it would fetch a higher price.
Dominion is one of nearly a dozen companies seeking government approval to export some of America’s abundant shale gas resources. Natural gas is trading at $2 per million British thermal units in the United States, much lower than $6-$8 in Europe and around $13 in Asia.
The Sierra Club and Maryland Conservation Council challenged construction of the Cove Point LNG import terminal more than four decades ago. Their 1972 settlement with Columbia Gas System Inc. bound Columbia and any future owners of the terminal to certain conditions for use of the land. It also required approval of the environmental groups for expansions.
“The deal says what it says, and that’s the end of the story,” Sierra Club lawyer Craig Segall said. “If they want to try to persuade someone to let them out of it, that’s their prerogative, but I don’t think they will be successful.”
Sierra Club to use agreement to fight Dominion hub
WASHINGTON, April 26 (Reuters) – The Sierra Club plans to use a decades-old legal settlement in its attempts to scuttle plans by Dominion Resources Inc to convert a liquefied natural gas terminal in Maryland into a major export hub.
The location of the planned Cove Point terminal, just south of Calvert Cliffs State Park, is subject to a unique legal agreement between Dominion, the Sierra Club and the Maryland Conservation Council, which allows the environmental group to weigh in on certain changes at the site, it said Thursday.
The fight over Cove Point could threaten Dominion’s plans to convert the facility from an import terminal to a potentially lucrative export plant that would ship up to 1 billion cubic feet of cheap U.S. natural gas a day to foreign markets where it would fetch a higher price.
The Sierra Club and Maryland Conservation Council challenged the initial construction of the Cove Point LNG import terminal more than four decades ago. They reached a legal settlement in 1972 with Columbia Gas System Inc, which was then the terminal’s owner.
That agreement bound Columbia and any future owners of the terminal to certain conditions for use of the land and required the approval of the environmental groups for expansions on the project. Sierra Club says that settlement allows them a say over whether Cove Point can become an export plant, which the group has been opposing as part of its wider fight against natural gas drilling from shale deposits.
“The deal says what it says, and that’s the end of the story,” Sierra Club lawyer Craig Segall said. “If they want to try to persuade someone to let them out of it, that’s their prerogative, but I don’t think they will be successful.”
Dominion is one of nearly a dozen companies seeking government approval to send some of America’s abundant shale gas resources abroad.
Obama energy critics in “fairy tale” world-US official
WASHINGTON, April 24 (Reuters) – A top Obama administration official on Tuesday accused lawmakers in the Republican-controlled House of Representatives of living in a world of “fairy tales and falsehoods” when it comes to energy.
In a stinging rebuke to the administration’s critics, Interior Secretary Ken Salazar strongly defended his department’s record on energy policy.
Referring to a world of fairy tales and falsehood in the nation’s capital, Salazar said in a speech at the National Press Club that “it’s in that imaginary world where we see the continuing and growing divide in the energy debate in America.”
“The imagined fairy tale world is the invention of campaign years and political rhetoric. I think you can find its edge when you walk out of the House of Representatives,” he added.
Salazar’s comments come as the White House works to shake off any taint from surging fuel prices ahead of the presidential election in November.
Instead of calling for more U.S. oil and gas drilling, Salazar said lawmakers should recognize that there is no silver bullet for high gasoline prices.
President Barack Obama gets some of his lowest poll marks for his handling of energy prices, which climbed this year on tensions with Iran.

