The oil and natural gas industry doesn’t really like the word “fracking,” which has became a pejorative term embraced by its opponents, but it looks like it’s going to be sticking around a bit in journalism circles.
The Associated Press on Tuesday released a series of updates to the AP Stylebook, every journalist’s reference bible. It included an entry on hydraulic fracturing.
A technique used by the energy industry to extract oil and gas from rock by injecting high-pressure mixtures of water, sand or gravel and chemicals. The short form is fracking, a term considered pejorative by the industry.
Most industry officials don’t use the term fracking very often, unless it is to mention plans to fracture, or frack, a well.
Media use of the term has consistently included a “k” although some industry watchers have complained it doesn’t belong there. Industry officials seem to prefer to abbreviate fracturing to “frac.”
An amendment meant to spur the conversion of the nation’s heavy trucking fleet to compressed national gas failed Tuesday to win enough votes to secure passage.
The amendment, part of a sweeping transportation bill, had more supporters than opponents in the Senate, but the 51-47 margin was short of the 60 votes needed for passage.
Despite the measure’s failure, CNG advocate T. Boone Pickens remained optimistic about the future of such legislation.
“I am gratified by the strong bipartisan majority vote for Nat Gas Act today. This legislation is a national priority. The question isn’t if it gets passed, it’s when. America has waited long enough for Washington to deliver on its promise to address the OPEC oil dependency problem.”
A bill by U.S. Rep. John Sullivan, R-Tulsa, remains alive in the House.
Senators failed to pass an amendment this afternoon that would have extended some federal tax credits for wind power and other renewable energy initiatives.
The amendment by Sen. Debbie Stabenow, D-Michigan, needed 60 votes to advance. The vote was 49-49, largely along party lines. Three Democrats voted against the measure.
Oklahoma’s Republican senators, Dr. Tom Coburn and Sen. Jim Inhofe, both voted against the amendment.
Included in the amendment was an extension of the production tax credit for wind and a 30 percent tax credit for manufacturers that retool their factories to make equipment for clean energy production, according to a statement from Stabenow’s office on March 8. The measure also covered incentives for biodiesel production.
In a statement, former Oklahoma Corporation Commissioner Denise Bode said renewable energy initiatives still have bipartisan support. Bode now heads up the the American Wind Energy Association:
“We are disappointed that tens of thousands of American jobs are being put in peril by partisan gridlock in Washington. Despite the partisan vote on these broader energy amendments, the fact remains that the wind Production Tax Credit (PTC) enjoys bipartisan support in the House and Senate.
“The clock is ticking and the stakes for a timely extension of the PTC could not be clearer. We stand to lose one of America’s best new sources of American manufacturing jobs. With every day that goes by, layoffs are occurring and further job losses and even plant closings will accelerate with each month we near expiration in December. Economic studies have shown that Congressional inaction on the PTC could kill 37,000 American jobs, shutter plants and cancel billions of dollars in private investment.”
Meanwhile, the conservative Heritage Foundation argued that tax incentives for energy production distort the free market and campaigned against the Stabenow amendment. The group called it an extension of the 2009 economic stimulus package:
For decades, various alternative energy industries have claimed that subsidies were needed to jumpstart their nascent industry. Wind, for example, has been making the claim for 20 years. Yet, since the production tax credit came online in 1992, wind accounts for only 2.3% of America’s electricity.
The first Devon Energy Corp. employees will move into the new tower at 333 W. Sheridan on Friday.
The company announced the plans Monday. The move marks the end of nearly three years of construction on the new Oklahoma City landmark.
Continental Resources Inc. employees are expected to begin moving next month into the former Devon building at 20 N. Broadway.
Chesapeake Energy Corp. CEO Aubrey K. McClendon recently spent two weeks in Asia talking to investors interested in buying a piece of the company’s natural gas assets, Bloomberg reports.
McClendon met with executives of Asian power utilities and state-run energy companies last month. He had 52 meetings during his trip, but declined to comment on any investment pledges in a recent interview with Bloomberg.
“We are presently owned by a group of investors who don’t think gas prices will ever go above $4. I want to be owned by investors who live in a part of the world that believes gas prices will never go below $10.”
Chesapeake is the No. 2 producer of natural gas in the United States. Bloomberg notes gas is 85 cheaper here than in the Middle East because of a supply glut.
Chesapeake announced in January it would curtail its natural gas production by up to 1 billion cubic feet a day because of low prices.
The company also is looking to raise up to $12 billion this year through joint ventures, volumetric production payments or even the sale its holdings in Texas’ oil-rich Permian Basin.
Chesapeake has a history of making deals with Asian investors.
The company has struck a pair of deals totaling about $1.8 billion with China’s CNOOC International, which bought a stake in Chesapeake’s holdings in the Eagle Ford and Niobrara shales while agreeing to help pay the Oklahoma City company’s drilling costs in those areas.
Oklahoma energy officials often talk about the glut of oil in storage at Cushing.
Cushing is the pricing hub for the New York Mercantile Exchange and home to countless oil storage tanks.
Producers have complained for the past several years that oil stored there is losing value because there of a lack of pipeline capacity away from Cushing. That is why they’ve talked up projects like the Keystone XL and Seaway pipeline reversal.
Those projects are getting closer to fruition, but that still leaves a lot of oil in storage at Cushing.
The Cushing terminal held 36.18 million barrels of oil last week, the most it has had since July, according to U.S. Energy Information Administration figures cited by Zacks.com in its weekly analyst blog.
The storage hub peaked at 41.9 million barrels of oil in April 2011, according to the blog.
To put those figures in some perspective, oil-focused Continental Resources Inc. reported it produced 22.6 million barrels of oil equivalent in 2011.
U.S. oil and natural gas companies continue to shift their focus away from low-priced natural gas.
Reuters reports energy producers had fewer rigs drilling for natural gas for the ninth straight week, pushing the number of gas rigs to its lowest point since July 2009.
Gas rigs were down 21 last week to 670, according to data from Houston-based oil services firm Baker Hughes.
A drop below 665 would put the gas rig count near a 10-year low, according to the Reuters report. There were 640 gas rigs operating in May 2002.
The U.S. Environmental Protection Agency has given preliminary approval to Colorado’s plan to reduce pollutant emissions that affect visibility at federal wildlife areas.
Oklahoma saw its plan to address regional haze rejected by the EPA last year. The state and its two largest utility companies last month asked the 10th Circuit Court of Appeal in Denver to review the EPA’s decision.
At first read, the difference between the states’ plans seems to be Colorado’s willingness to retire old coal plants and switch others to natural gas, while Oklahoma had hoped to switch to low-sulfur coal to keep its coal plants in operation for the forseeable future.
Colorado Gov. John Hickenlooper said he was pleased with the EPA’s ruling.
“The EPA’s proposal to approve the Regional Haze Plan is a ringing endorsement of a comprehensive and collaborative effort to address this issue. This plan is a major step in the state’s efforts to comply with the federal Regional Haze rule, a congressionally-established air quality goal that seeks to improve visibility in national parks and wilderness areas across the country, while also providing public health benefits.”
The EPA’s plan for Oklahoma could lead to unprecedented utility bill increases, but environmental groups like the Sierra Club contend it is an important step in protecting state residents from pollution
Oil giant Exxon Mobil Corp. intends to spend $150 billion over the next five years in search of oil and natural gas, the company announced Thursday in an investor presentation at the New York Stock Exchange.
CEO Rex Tillerson said huge investments are needed to expand the supply of traditional fuels like oil and gas while also advancing new energy sources, The Associated Press reported.
Exxon, the world’s largest publicly traded energy company, expects global energy demand to increase 30 percent by 2040, compared with 2010 levels.
AP also reports Exxon is investing more of its money in producing natural gas, which the company believes will replace coal as the second-most popular fuel by 2025. The company spent more than $30 billion in 2010 to acquire XTO Energy and become the largest natural gas producer in the U.S.
Twelve earthquakes last year were centered within a mile of a disposal well for brine, a by-product of oil and natural gas hydraulic fracturing, or fracking.
A number of coincidental circumstances appear to make a compelling argument for the recent Youngstown-area seismic events to have been induced,” including the timing, location and depth of the earthquakes in relation to the well, the report said.
In response, the natural resources department has created new rules for brine disposal that the state claims are “among the nation’s toughest.”
The new rules require operators to submit more comprehensive geological data when they request a drill site. Also, the companies must electronically track the chemical makeup of all drilling waste water.
While the department found that drilling activity may have caused the Ohio earthquakes, the reports states that most drilling activity does not cause similar problems.
Geologists believe it is very difficult for all conditions to be met to induce seismic events,” the report states. “In fact, all the evidence indicates that properly located … injection wells will not cause earthquakes.”
Oklahoma City-based Chesapeake Energy Corp. and Devon Energy Corp. both are drilling for natural gas in Ohio’s Utica and Marcellus shale formations. Both companies said they are not affected by the new rules because they do not operate a disposal well in the Buckeye State.