President-elect Donald Trump has made some big promises regarding the energy industry. He has included the Keystone pipeline in his plan for his first 100 days in office and is planning to grant the necessary State Department permit, previously denied by the Obama Administration, to TransCanada Corporation to construct the northern stretch of the pipeline. (more…)
The U.S. Department of the Interior and the Bureau of Safety and Environmental Enforcement announced final well control regulations for offshore drilling last week. The rules will purportedly make offshore drilling safer and are a consequence of the administration’s desire to prevent well control events like the 2010 BP Deepwater Horizon blowout, which killed 11 workers and leaked millions of gallons of oil into the Gulf of Mexico. (more…)
A regulatory framework for hydraulic fracturing, or fracking, currently does not exist in Florida. Actually, neither does fracking itself, but both of those things could change soon. The State Affairs Committee passed a controversial bill proposed by republican representatives, Ray Rodrigues and Cary Pigman, regulating fracking, and it is on its way to the House floor. (more…)
Canada’s energy sector may be significantly impacted by the recent election of liberal Justin Trudeau as Prime Minister. The last nine years have seen conservative Stephen Harper at the helm. A known ally of the energy industry, Harper came under attack by environmentalists for failing to do enough to reduce carbon emissions. Trudeau is expected to take more of a watchdog role in relation to the energy sector, having campaigned on a platform that included a rollback of tax breaks for oil and gas producers and greater attention to climate change.
Even without the change in political climate, Canada’s oil and gas sector has seen better days. With global oil prices at less than $50 a barrel, it has become increasingly expensive to produce crude oil from the tar sands of western Canada. Although clearly distinguishable from his conservative predecessor, Trudeau is not anti-energy. The Liberal Party supports several pipeline projects, including TransCanada’s Energy East project, Kinder Morgan Inc.’s Trans Mountain pipeline and the Keystone XL project.
The current United Steelworkers strike is the first national strike called by the union since 1980. After contract negotiations with Shell Oil Company failed, 3,800 workers stopped work at nine sites on February 1, 2015. The nine sites, located in Texas, California, Kentucky and Washington, represent ten percent of the United States refining capacity. The strike expanded this week to include two more plants in Indiana and Ohio. All but one of the plants continue to operate with temporary replacement workers, but will be forced to cut operating rates. (more…)
The last six to seven months have seen an approximate 70 percent drop in crude oil prices, from $115 per barrel in June to just $45 as of January 14. There are multiple factors contributing to the significant drop in price, one of which is the United States’ new status as the world’s largest oil producer, increasing its oil production by 95 percent in the last six years through the use of horizontal drilling and hydraulic fracturing. Because the country now imports significantly less oil than it had previously, it has created an excess supply. Other oil-producing countries are not willing to reduce their own production to reduce the supply and increase the demand, thus restoring the fallen price. The consequences of falling oil prices are as legion as the causes, including the cancellation of oil and natural gas projects, the layoff of oilfield workers, a decline in the number of oil rigs and serious economic disruption in countries like Russia and Iran. (more…)
A U.S. District Court Judge in Houston dismissed a lawsuit by a former contractor on behalf of the United States against BP alleging claims under the False Claims Act that had been pending since 2009. In U.S. ex rel. Abbott v. BP Exploration and Production Inc., the former contractor for a BP brought the suit alleging that the oil giant had lied to the U.S. Department of the Interior to obtain exclusive offshore leases in the Gulf of Mexico by failing to comply with federal safety regulations. The plaintiff cited to the lack of engineering design certification stamps in BP’s records. The environmental group, Food & Water Watch, joined as a plaintiff in the suit. Under the Outer Continental Shelf Lands Act, the plaintiffs sought an injunction preventing BP from operating in the Atlantis field in the Gulf and treble damages in the amount of $256 billion. The case received immense attention after the Deepwater Horizon explosion in 2010. (more…)
On February 11, 2014, the U.S. Department of Energy issued an order conditionally granting long-term contract authorization to export liquefied natural gas by vessel to non-free trade agreement nations from the Cameron LNG, LLC terminal in Cameron Parish, Louisiana. The order conditionally grants approval to export natural gas in a volume equivalent to 1.7 Bcf per day, or 620 Bcf per year, for a twenty-year period. The Department of Energy’s approval is conditional pending the completion of an environmental review. (more…)
The U.S. Chemical Safety and Hazard Investigation Board has served Black Elk Energy with a subpoena in response to the oil platform explosion in the Gulf of Mexico on November 16, 2012. The Board has also served a subpoena on Grand Isle Shipyard, the Louisiana company that supplied Black Elk with the platform workers. Twenty-six workers were on the platform at the time of the explosion; two workers have died, three required hospitalization, and one remains missing. Twenty-eight gallons of oil may have spilled into the Gulf. It is requesting information regarding witnesses, physical evidence, combustible gas detectors, job safety analyses, work orders, work permits, policies, and inventories. Responses from both companies are due November 30, 2012. The Board has not yet launched a formal investigation. The Board is involved in six current investigations involving a fire and/or explosion at an oil and gas facility. All of the current investigations involve incidents on land. The Board has also conducted an inquiry into the 2010 Deepwater Horizon explosion, although it did not receive all of the records it subpoenaed from drilling contractor Transocean because the company challenged the Board’s authority to conduct such an inquiry. (more…)