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According to the Pew Research Center the top two public priorities for 2012, by large margins, are the economy and job creation. So surely the White House has a plan, and they do. And with a slight modification of the chart posted by TPM the other day, here it is:
More on higher energy taxes here and here, and why that growth line should be higher here.
Reuters reports that eight deepwater drilling rigs are expected in the Gulf of Mexico this year, which would bring the active deepwater contingent to 29 – just short of the number before the 2010 Macando accident. While that will be a positive step, here are some reasons to hold off popping the champagne corks:
The eight rigs are not yet in the Gulf, not yet working.While permit applications to work on Gulf jobs have been submitted, the rigs will return there only if the permits are approved.Given “A” and “B” above, it’s still premature to talk about Gulf drilling being back to normal or “close to pre-moratorium levels.”The eight rigs would bring the Gulf rig count to “just short of the level” before the administration’s permit moratorium, not equal to levels of two years ago.But here’s the most important point missed by the report: The lost Gulf production caused by the moratorium – the difference between where production is now and where it was forecast to be by government officials a couple years ago.
According to the Energy Information Administration, Gulf production fell from 1.55 million barrels per day in 2010 to 1.32 mb/d in 2011, and was estimated to fall to 1.23 mb/d this year. That’s a 21 percent decline. But look at EIA’s 2010 forecast. Two years ago production was predicted to reach 1.76 mb/d this year. The difference between that forecast and the most recent Gulf production estimate is a whopping 30 percent.
Here’s a chart we’ve used before to illustrate the gap:
API’s Vice President for Policy Analysis Kyle Isakower:
“We should not forget that the (December 2011) Quest study demonstrated that without the moratorium, the rate of drilling was projected to increase, not just stay flat. We remind those following this issue that the baseline they should compare current levels to is the previously planned activity level, not just the activity level at the time the moratorium was put in place.”
A year ago this week the FracFocus.org online chemical disclosure registry was created, and what a year it has been: 130 companies logging in the chemicals used in the hydraulic fracturing of more than 15,000 wells. More than that, the site is information rich on fracking, groundwater protection, state regulatory efforts and more.
The registry was developed by the Groundwater Protection Council and the Interstate Oil and Gas Compact Commission. Most importantly, it has been embraced by the oil and natural gas industry as a useful response to legitimate questions about the pressurized fluids – 99.5 percent water and sand, 0.5 percent chemicals – used to fracture subterranean shale formations, freeing natural gas and oil.
According to a report in The Oklahoman, the site has become a clearing house for state and federal regulators fielding questions about hydraulic fracturing. “That's what we intended,” said Gerry Baker, the Interstate Oil and Gas Compact Commission’s associate executive director. Officials estimate about 75 percent of all wells drilled in the U.S. are accounted for on FracFocus.
Transparency equals information, which fosters confidence in communities where hydraulic fracturing is under way. Community support is an essential element in the process that is driving an energy revolution, seen in North Dakota, Pennsylvania, Texas, Ohio and other states.
Happy birthday, FracFocus – and many more!
“The AP even concedes this point mid-way through the story, noting ‘if drilling activity rises around the globe for a sustained period of time, gasoline prices can fall as that new supply eventually finds its way to market.’”Supply matters – but don’t take our word for it, AP. Look at your own recent reporting:
Glenn Enslen, Carroll County, Ohio’s economic development director, says the east-central part of the state has been the “forgotten part of Ohio for the last 50 years.” No longer. The development of shale resources have changed that part of the state pretty much overnight. “All of a sudden we’re in the forefront of economic development in the state of Ohio,” Enslen says.
Development of Ohio’s Utica Shale is in its infancy compared to Marcellus Shale activity in next-door Pennsylvania. But the shale regions of Ohio see the signs of an energy-related bonanza in terms of jobs, spin-off jobs and economic growth that lifts all boats. “We’ve seen a huge impact from the oil and gas business,” Enslen says. “We have one local hotel. If you’d like to stay there you can get a reservation in three years.”
Here’s a video on boom conditions that are starting to be felt in a long-overlooked, but primed-for-growth area:
During a tour of U.S. Steel’s tubular operations facility in Lorain, Ohio, earlier this week, Sen. Rob Portman was able to see, first hand, the way energy from shale is helping lift a key part of the manufacturing sector.
Actually, the relationship between energy and steel manufacturing has mutual benefits. Developing energy in the Utica and Marcellus shale plays of Ohio and Pennsylvania requires vast amounts of quality steel for the best well casings. So, U.S. Steel and other materials suppliers essentially are helping generate demand for their own products.
In Lorain, the Chronicle-Telegram reports that U.S. Steel recently commissioned a tubular finishing line, reflecting a $100 million investment. The line makes seamless steel pipe for construction and oil and natural gas exploration and employs 120 workers. “What’s happening here is we’re producing a product that’s going to be used to create more energy here in America,” Portman said.
The chief obstacle to sustained success? Over-regulation. Portman said Ohio has a good regulatory regime in place for oil and natural gas development, but he’s concerned there might be attempts to add on a layer of unnecessary federal regulation:
“Let’s not do what the EPA has done in regard to other areas, including refineries around the country, and over-regulate, which makes America a place where you can’t compete, and which drives jobs offshore. … A one-size-fits-all approach isn’t going to work.”
Agreed. The economic benefits of shale energy are being realized in Ohio, Pennsylvania, North Dakota, Texas and other states. Jobs are being created and long-suffering industries like steel are seeing new life. Here’s a new television commercial that captures the essence of what’s happening:
For more information, visit Energy From Shale.
by Victor Gabriel Ganescu
(Romania)
Over 12 years experience in Materials Management, Materials Controlling. Comfortable in working in a highly computerized environment, SAP user in MM module. Career started from a storekeeper and has risen to experienced material (parts) coordinator level by implementation and practice of proper Supply Chain principles and Material Control Procedures. Maintaining inventory levels within established guidelines. Monitoring material deliveries against ROS (Requested on site) dates, identifying potential shortages (Back orders) and ensuring that corrective action is taken by the relevant department. Monitor that delivered materials and equipment are in compliance with documentation Purchase Orders, Requisitions and issued Materials at the warehouse and their further delivery to sites. Keeping track of all incoming and outgoing materials, Monitoring back load materials to stock. Very safety conscious and ensuring cleanliness and proper housekeeping of warehouse area. Ability to work with diverse groups of people.
