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Oil and Gas Roundup — April 21

April 09, 2015
TOPICS: In the news
A roundup of oil and natural gas industry news from around the state, nation and world:

Feds admit exporting U.S. oil won’t raise gas prices, but Obama continues to resist

With U.S. energy production at near-record highs, pressure is mounting on the Obama administration to lift a 40-year-old ban on crude oil exports.

The White House acknowledged last week that sending American crude oil abroad would not drive up domestic gas prices, a common refrain among export opponents. In fact, Energy Information Administration officials said exports actually could drive down prices even further by increasing global supply.

But unlike American natural gas export projects — which President Obama has come to support and the Energy Department gradually has begun to allow — the administration has shown no signs of changing course on the crude oil ban, a relic from the early 1970s when global shortages led the federal government to guard U.S. fuel supplies and block exports.

The dynamic today is dramatically different, with U.S. crude oil production near all-time highs and poised to set a record this year.

“America’s growth as an energy superpower has been a game-changer, but our trade policies are stuck in the 1970s. Study after study shows that free trade in crude oil would promote the creation of U.S. jobs, put downward pressure on fuel costs and reduce the power that foreign suppliers have over our allies,” said Erik Milito, director of upstream and industry operations at the American Petroleum Institute.

Indeed, the U.S. energy landscape has been transformed in just a few years. Less than a decade ago, most analysts predicted that the U.S. would remain a leading importer of oil and gas. Today, America is the world’s No. 1 producer of oil and natural gas, thanks largely to the discovery of vast deposits such as the Bakken oil field and the Marcellus Shale, and the advancement of the drilling technique known as hydraulic fracturing.

Read more at The Washington Times.

Column: 'Setbacks' really an attempt to ban drilling

Over the past few years, anti-fracking groups have waged a political campaign for “local control” in cities all across the country. They say it’s about “reasonable” regulations, but it’s really about shutting down oil and gas drilling everywhere.

Several of these groups have been lobbying Texas municipalities to ban drilling, but they don’t dare attempt to sell their proposal as an outright prohibition. The centerpiece is a recommendation that well sites be at least 1,500 feet from any structure.

These “setbacks” are nothing more than drilling bans, as the activists admit — but only after the city has adopted them. For example, after Dallas passed a 1,500-foot setback, Earthworks — an extreme activist group that wants a “war on fracking” nationwide — celebrated the ordinance as a “de facto drilling ban.” In Flower Mound, after the city passed a 1,500-foot setback, no new wells were permitted. Even in Denton, which later passed an outright ban on fracking, activists celebrated the city’s 1,200-foot setback as a drilling ban.

A representative from Environment Texas recently defended so-called “local control” in this paper. Curiously, he never admitted that Environment America, his group’s parent organization, says on its website, “We’re working to ban fracking wherever we can — from New York to North Carolina to California.”

When they’re not working to “ban fracking wherever we can,” these groups are making erroneous claims designed to instill fear about energy development.

For example, activists frequently allege health impacts from fracking, using widely criticized research from the Colorado School of Public Health. But the Colorado Department of Public Health and Environment, or CDPHE, has repeatedly disavowed the researchers’ claims. After the school’s latest study was released, the head of CDPHE, a former pediatrician of the year in Colorado, said that “a reader of this study could be easily misled to become overly concerned.”


Fed could be to blame for oil's decline, analyst says

The dramatic 10-month drop in the price of oil could be due to ultra-loose monetary policy by the U.S. Federal Reserve, according to a senior analyst at a major financial services company.

Mark Lewis from Kepler Cheuvreux said on Monday that the boom in U.S. shale gas production over the last few years that had helped push down oil prices was partly driven by the Fed's "very, very low interest rates."

"The financial dimension to the shale story is hugely important," he told CNBC. "I think it's questionable whether we would ever have had the increase in oil production we've had out of the shale plays over the last three or four years if we hadn't been in this environment."

The Fed has held its target range for the federal funds rate at 0-0.25 percent since the end of 2008. With rates so low, banks have been able to lend money at cheaper rates than would be usual in a healthy economic environment.

Lewis said that the nascent shale industry — in which the "unconventional" gas is drilled from the ground in a process known as hydraulic fracturing or "fracking" — has boomed as a result of access to ultra-cheap financing, flooding the market as a result.

Many analysts, including the International Energy Agency, see high U.S production as a key factor behind the price drop, along with global weak demand and the Organization of the Petroleum Exporting Countries (OPEC)'s refusal to cut its own production.

Read more at CNBC.

Shale boom creates jobs for women — but only as prostitutes and maids, activist claims

The controversial figure at the heart of New York’s ban on hydraulic fracturing says energy development only creates jobs for women as “hotel maids and prostitutes.”

Sandra Steingraber – the peer reviewer of a key research paper used to justify New York’s ban on hydraulic fracturing (who claimed she was “absolutely objective” despite her leading role with the group New Yorkers Against Fracking) – made these remarks during a lecture at the University of Pittsburgh called “Fracking is a Feminist Issue: Women Confronting Fossil Fuels and Petrochemicals in an Age of Climate Emergency.”

As Steingraber put it, “Fracking as an industry serves men. 95 percent of the people employed in the gas fields are men. When we talk about jobs, we’re talking about jobs for men, and we need to say that. And the jobs for women are hotel maids and prostitutes. So when we talk about fracking coming into a community what we see is that women take a big hit, especially single women who have children who depend on rent to own housing.”

These comments are particularly revealing considering Steingraber’s key role in the ban on fracking in New York.  In fact, the report that she peer reviewed (which was written by two anti-fracking groups, Global Community Monitor and the Center for Environmental Health) was held up by New York Health Commissioner Howard Zucker to support the ban on fracking. 

Meanwhile, Steingraber and the authors of the report did not disclose their bias, violating at least four different codes of conduct for scientific research.  Steingraber even told Fox news there was no problem peer-reviewing a paper about shale gas development when you’re also an outspoken opponent of shale gas development.

According to the Jan. 19 news story, Steingraber said, “I think we are all proud of our ability to be conservative and analytical and absolutely objective about the data. I look at the data and call it as I see it.”

Read more at Energy In Depth.
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