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Oil and Gas Roundup — Oct. 8

October 08, 2014
TOPICS: In the news
A roundup of oil and natural gas news from around the state, nation and world:

GAO report: States better regulators than EPA

A new report from the Government Accountability Office (GAO) confirms what many small-government environmentalists have been saying for years: States are more effective at regulating the disposal of wastewater from hydraulic fracturing operations than is the Environmental Protection Agency.

Water recovered after the hydraulic fracturing process must be disposed of or recycled. Disposal typically means injecting the wastewater into deep, underground wells regulated by EPA under the Underground Injection Control (UIC) program.

GAO concluded EPA’s injection-well safeguards sufficiently protect drinking water: Few allegations of drinking water contamination, and fewer confirmed cases of groundwater contamination, have been reported.

However, GAO’s report stressed EPA has failed to be proactive regarding emerging challenges, such as induced seismicity (manmade earthquakes) and excessive pressurization of rock formations. GAO urged EPA to update its regulations to reflect state laws.

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Boost in natural gas at power plants leads to reduced greenhouse gas emissions

Greenhouse gas emissions from more than 8,000 large US industrial sources totaled 3.18 billion tonnes of carbon dioxide equivalent in 2013, about half of total domestic GHG emissions, the US Environmental Protection Agency said in its fourth annual GHG inventory.

The amount was 20 million tonnes, or 0.6%, more than 2012’s total, driven largely by increased use of coal for power generation, EPA said in the Sept. 30 report. Power plants remained the largest single industrial source of GHGs, with more than 1,550 emitting more than 2 billion CO2 equivalent tonnes, 13 million more than in 2012 and roughly 32% of the U.S. total.

Petroleum and natural gas systems were the second largest stationary source in 2013, reporting 224 million tonnes of GHG emissions, 1% less than in 2012, EPA indicated. Refineries, the third largest source, reported 177 tonnes, a 1.6% year-to-year increase.

EPA noted that reported oil and gas methane emissions have dropped 12% since 2011, with the biggest reductions coming from hydraulically fractured gas wells, which have decreased 73% during that period. The agency said it expects to see further reductions as its 2012 oil and gas standards are fully implemented.

Changes from 2012 to 2013 took place as US oil and gas production and refinery activity climbed, American Petroleum Institute officials told OGJ in response to the EPA report. “It all came against a backdrop of increased production and creating jobs in the U.S.,” said Howard J. Feldman, API’s regulatory and scientific affairs director.

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Analyst: Daily Springer Shale oil output may hit 60,000 barrels in next 5 years

The Springer shale could produce between 40,000 and 60,000 barrels per day (bpd) within the next five years, but the oil and gas industry must address several challenges before Springer’s full potential can be determined, a Wood Mackenzie analyst told Rigzone.

Last month, Continental Resources Inc. announced it had made this new oil discovery in the heart of the South-Central Oklahoma Oil Province (SCOOP), located in the southern Anadarko Basin about an hour southwest of Oklahoma City.

Prior to Continental’s announcement, SCOOP – a term also coined by Continental – was mostly associated with the Woodford shale, which oil and gas companies have been drilling over the past decade. “The Springer shale is exciting in that it shows that south-central Oklahoma province is showing signs of stacked pay potential,” said Brandon Mikael, U.S. Lower 48 upstream analyst, regarding Wood Mackenzie’s initial assessment of the Springer play.

The Springer shale, which sits above the Woodford, is a thick Mississippian aged formation, but unlike the Woodford, is a mix of shale and sandstone.

Because of its composition, Continental has suggested the play won’t have all the characteristics associated with some of the shale play – including rapid production decline, a major issue in other shale plays – and will have higher porosity and permeability, Mikael noted.

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4 facts to know about the Center for American Progress's flawed methane report

The Center for American Progress (CAP) released a new report yesterday, which makes the bizarre claim that methane emissions from venting and flaring on federal lands “have significantly increased over the past five years” and that fugitive methane emissions from production “surpass even the highest estimates of methane emitted from venting and flaring.”

CAP, a left-leaning organization that receives funding from anti-fracking foundations like Rockefeller and Tides, did not collect any new data, but rather relied on a report from Status Consulting. That report was commissioned by the Wilderness Society, an environmental group that has been critical of fracking, including a blog post entitled, “Fracking dangers: 7 ugly reasons why wilderness lovers should be worried.” The post contains a picture of an anti-fracking sign depicting a bottle of water with a skull and cross bones and the word “poison.”

Stratus, as many will remember, has been in the news quite a bit over the past several years, most prominently for the work it did to support an extortion campaign targeting Chevron in connection with the Lago Agrio case in Ecuador. When the facts finally came to light about Stratus’s (possible criminal) complicity in preparing bogus technical reports for the litigants, the firm was forced to publicly recant its work and offer an apology. The Boulder, Colo.-based company has become a go-to firm for environmental groups over the years, especially when activists’ litigation strategies call for manufactured data sets and inflated damage estimates.

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