Eight activists trying to block construction of the southern leg of the Keystone XL pipeline have moved into a tree fort in North Texas until developer TransCanada abandons the project. They took up their positions 80 feet above the ground on Monday.
Two other Tar Sands Blockade activists Tuesday afternoon were arrested after chaining themselves to a backhoe at a construction site near Winnsboro, Texas.
The group is a coalition of Oklahoma and Texas landowners dedicated to using nonviolent direct action to stop the pipeline because of the risks it poses to the environment.
“The risk of inaction is far greater than the risk of taking action – even risky action like this,” Tar Sands Blockade spokesman Ron Seifert said. “We are committed to undertaking a campaign of nonviolent civil disobedience to stop construction of Keystone XL, and Tar Sands Blockade will continue to protect the Winnsboro tree village. It is a symbol of all the homes and families crudely threatened by this tar sands pipeline. Sometimes, one must simply stand one’s ground in the face of eminent threats like those posed by this dangerous pipeline in order protect the health and safety of their families, loved ones, and that of their neighbors.”
TransCanada has secured the necessary permits for the 485-mile pipeline between Cushing’s oil storage hub and refineries along the Gulf Coast.
“TransCanada’s immediate concern is for the safety of the individuals who have placed themselves in harm’s way, as well as ensuring the safety of our staff and contractors,” a spokesman said Monday. “We are also concerned about the safety and economic welfare of thousands of Americans working on this $2.3 billion project. If the protestors had their way, thousands of people trying to provide for their families would be thrown out of work.”
Construction of the pipeline continues at several other locations along its route.
Continental Resources Inc. founder and CEO Harold Hamm is expected to testify Thursday morning before a House subcommittee in Washington, D.C.
Hamm plans to talk about the potential for North American energy independence, opening up federal lands to oil and gas drilling and the importance of tax credits for the oil and gas industry, according to his prepared testimony.
I am excited about our energy future and therefore our economic future. But I am equally concerned about federal policies that could cost us that future.
Just a few years ago, America was importing 60 percent of its oil. But with technological advances in horizontal drilling over the last 15 years, we now import less than 45 percent of our oil. Just a few years ago we estimated our nation’s natural gas reserves at seven years. We now have natural gas reserves of over a century. With this extraordinary advance in technology we can now access the immobile oil and natural gas of the world. Previously to this point we were only able to produce the world’s mobile oil and natural gas. There is about 1/3 more immobile oil and natural gas than the mobile oil and gas we have produced for over a century. The technology that allows us to drill two miles down, turn right, go another two miles and hit a target the size of a lapel pin has unlocked the resources that make energy independence a reality.
This paradigm shift in American oil and gas exploration brings with it high-paying jobs, increased tax revenues and economic growth, while lessening our dependence on foreign oil.
Hamm also serves as the head of energy advisory committee for GOP presidential candidate Mitt Romney, whose energy plan touches on similar subjects as Hamm’s prepared remarks. But Hamm emphasizes in his testimony he’s there as a private citizen:
But I am not here representing Continental Resources, any political campaign or political party. I am here as an American patriot that loves my country and a person that is grateful for the opportunities I have been given by being an American. Only in America can the thirteenth child of a sharecropper turn a one-man, one-pump-truck operation into one of the nation’s largest oil companies.
Meanwhile, the folks at the Think Progress environmental blog have several hypothetical questions for Hamm ahead of his testimony. They are skeptical of the claims of energy independence and want more details on which federal lands might be opened for oil and gas exploration.
In his hearing testimony, Hamm supports opening federal lands and offshore areas for drilling, but claims it “would impact my company very little” because “we mainly work on private lands.” But Hamm holds a number of permits to drill on public lands, including recent permits for Montana and North Dakota. Romney’s plan would likely boost Hamm’s profits, but potentially at the risk of Americans’ national parks.
Chesapeake Energy Corp. moved closer to its 2012 fundraising goal on Wednesday as it announced asset sales totaling about $6.9 billion.
The Oklahoma City-based oil and natural gas company has been looking to shed some assets to help overcome a budget shortfall estimated to be as high as $22 billion.
CEO Aubrey McClendon said the deals announced Wednesday put Chesapeake close to its goal of raising $13 billion to $14 billion this year.
“These transactions are significant steps in the transformation of our company’s asset base to a more balanced portfolio among oil, natural gas liquids and natural gas resources and production by focusing on developing and harvesting the value embedded in the 10 core plays in which Chesapeake has built a No. 1 or No. 2 position,” he said in a news release.
Chesapeake will use a portion of the proceeds from the asset sales to pay off a $4 billion loan it took out in May.
Chesapeake is selling the bulk of its acreage in west Texas’ oil-rich Permian Basin for about $3.3 billion. The company also will generate an additional $3 billion by selling most of its midstream holdings in a series of transactions.
The sale of assets in Ohio’s Utica Shale and other noncore areas will bring in another $600 million.
The Permian Basin assets have been viewed as the prize of Chesapeake’s portfolio of holdings for sale.
A subsidiary of Royal Dutch Shell has agreed to buy Chesapeake’s holdings in the lower Delaware Basin, while Chevron USA Inc. is buying acreage in the northern part of the basin.
Houston-based EnerVest is acquiring Chesapeake assets in the Midland Basin in a previously announced deal.
Those holdings produced about 21,000 barrels of liquids and 90 million cubic feet of natural gas per day during the 2012 second quarter. That accouned for only 5.7 percent of Chesapeake’s production during the quarter.
Chesapeake is retaining about 470,000 acres in Midland Basin for future sale or development.
McClendon reiterated that the Oklahoma City oil and natural gas company plans to sell $17 billion to $19 billion in assets — about one and a half times Chesapeake’s equity market capitalization — by the end of 2013 while continuing to increase its total production.
McClendon said Chesapeake is now the country’s No. 11 liquids producer and is still the No. 2 natural gas producer even though it has shifted its focus away from dry gas.
While 85 percent of Chesapeake’s 2012 drilling budget is dedicated to oil and natural gas liquids-rich areas, McClendon said he expects natural gas prices to soon rise. He said he disagrees with models that show natural gas production continuing to rise over the next few months.
Given that Chesapeake produces 10 percent of the natural gas in the U.S. and has been responsible for 35 percent of the gas production growth over the past few years, we find it hard to model natural gas production growth when we’re going to decline 7 percent,” McClendon said.
Chesapeake and other natural gas producers have stopped production as quickly as they ramped it up, McClendon said.
The buildup was unprecedented, and the runoff was equally unprecedented,” McClendon said.
If the country experiences a normal winter, natural gas prices will soon climb, he said.
At that point, many natural gas producers will rush back into the market, but Chesapeake will not, McClendon said.
The question isn’t: Can you make money drilling a gas well in the Barnett or Haynesville at $4?” he said. “The question is: What else can you do with that money? I think we can make more with oil.”
While the oil and natural gas liquids market likely will remain Chesapeake’s focus, McClendon said natural gas is still a valuable commodity.
I think the days of $2 to $3 gas are going to be over. I don’t think the days of $7 or $8 gas are quick to return. But there is a lot of money to be made in the middle,” McClendon said.
Canadian natural gas giant Encana Corp. has concluded company officials did not collude with rival Chesapeake Energy Corp. to lower the cost of land acquisitions in Michigan in 2010, Reuters reports.
The news agency reported in June that the companies plotted to keep land prices under control in the Collingwood Shale, a promising oil and natural gas play. That raised the specter of antitrust violations that have sparked investigations by the U.S. Department of Justice and authorities in Michigan.
A subsequent report cited emails indicating Chesapeake CEO Aubrey McClendon directed company officials to renegotiate or delay closing on deals with major Michigan lease holders after learning Encana was paring back its leasing efforts there.
A Chesapeake spokesman declined to comment Wednesday on the latest Reuters report.
The company has denied any wrongdoing in Michigan, where officials said it had considered a possible joint venture with Encana that was never consumated.
Encana’s board of directors, which led the investigation launched on June 25 with the assistance of outside attorneys, did not provide Reuters with a report on the scope of the inquiry, nor explain how it reached its conclusion.
“We can’t offer more detail than what we’ve released as the issue is still under investigation by the Antitrust Division of the Department of Justice and the Michigan Attorney General,” Encana spokesman Jay Averill said in an email to Reuters.
Chesapeake also is facing inquiries from the IRS and U.S. Securities and Exchange Commission, as well as an internal review by its board of McClendon’s personal finances.
McClendon is scheduled to speak Thursday morning at an industry conference in New York, his first such appearance since April.
Southeastern Asset Management, Chesapeake’s largest shareholder, has advised McClendon to focus on running the company rather than acting as an industry advocate.
Opponents of the Keystone XL pipeline are proclaiming victory Wednesday after several protesters chained themselves to equipment set to be used to clear trees from the pipeline’s route in Texas.
But project officials contend the demonstration did not impact construction of the pipeline between Cushing’s oil storage hub and refineries on the Gulf Coast.
“Even though we have all the necessary permits and approvals to build the Gulf Coast Project and have followed all laws of the state of Texas, there are some who will not accept that the project is legally allowed to proceed.
Their claims that they disrupted construction are false.
The reality is protesters attached themselves to equipment located on a private landowner’s property that belonged to a third-party contractor. The equipment was not in use today. Construction activity was not disrupted and continued as planned elsewhere.
It is unfortunate that this handful of individuals – and the groups supporting them – are spending so much time and energy trying to prevent hard-working Americans from providing for their families by building the Gulf Coast Project. The Gulf Coast Project is creating jobs that help several thousand American workers use their skills to build an important piece of energy infrastructure, and that energy infrastructure is going to keep Gulf Coast refineries full with a reliable supply of crude oil.
Regardless of some people’s misinformed opinions about this pipeline, we hope that they will conduct themselves in a way that respects the safety and security of our work sites and the employees and contractors working there, not to mention their own personal safety.
It’s important to note that in coordinating with local law enforcement agencies regarding today’s event, protesters were treated with respect, no arrests were made, and no injuries were reported,” developers said.
The latest action by Tarsands Blockade began about 7 a.m. Wednesday when landowner advocates locked themselves to a feller buncher machine near Saltillo, Texas.
Police initially threatened protesters with trespassing or theft charges, but left about 11 a.m. without making any arrests, according to the group’s website. Workers also were turned away by a foreman.
Seven Tarsands Blockade activists were arrested last week after a similar protest in south Texas.
Organizers said the protests are meant to block construction of the Keystone XL pipeline, which they contend will endanger the environment with its toxic tar sands slurry.