Another salvo in the question over fracking

Texas Barnett Shale gas drilling rig near Alvarado TX. Image via Wikipedia

Opponents of natural gas production are heralding the release of a new study that finds hydraulic fracturing (fracking), the process used to break apart underground shale deposits with high pressure water and chemicals in order to release shale gas, generates at least 20% more greenhouse gases than coal.

Previously, opponents had rallied around the threat the process posed to water supplies. Some studies have found possible evidence that hydrofracking fluids can contaminate water aquifers. The industry, meanwhile, argues these findings.

The new study, conducted by scientists at Cornell University, evaluated the greenhouse gas footprint of natural gas obtained by fracking. They found that the small amounts of methane gas, a greenhouse gas with greater warming potential than carbon dioxide, escaping to the atmosphere from venting and leaks over the life of a well is 30% higher than emissions from conventional gas. Since the greatest danger of methane leaks is during the initial fracking process, the emissions are greatest in the short-term. The study found emissions to be 20% greater than coal on a 20-year comparison, but comparable to coal over 100 years. The study notes that although the uncertainty of fugitive emissions is large, it illustrates the larger need for published and consistent pollution measurement by the gas industry. So far the industry has fought such measures.

Meanwhile, critics of the Cornell study are crying foul over the uncertainties and pointing to the advantages clean-burning gas has over coal. Energy in Depth, an association of independent producers, has posted a rebuttal to the study. And Tom Zeller, Jr. has posted a thoughtful post about the debate on the New York Times’ Green Blog. With the future of nuclear power up in the air, the debate over natural gas is an important one.

You can read a PDF of the Cornell study here.

Chevron to spend $26 billion in capital expenditures

CNBC has posted an interview with Chevron CEO John Watson, in which he discusses Chevron’s growth plan. The company is slated to spend $26 billion in capital expenditures, up 20% from last year. Of particular interest are his comments on natural gas, which Chevron has focused on. Currently, natural gas is trading at a 75% discount to crude oil and the U.S. has abundant supplies, enough to last for over 100 years according to the Energy Information Administration. In addition, President Obama recently endorsed the plan of T. Boone Pickens to convert heavy-duty vehicles to run on natural gas instead of diesel.  There have been concerns over the development of these resources, however, due to possible pollution linked to the process of hydraulic fracturing.

You can watch the video here.

“Major energy announcement” is more of the same

A coal mine in Wyoming. Image from Wikipedia.

Secretary of the Interior Ken Salazar said he was going to make a ” major energy announcement” Tuesday from Cheyenne, Wyoming. While we’d hoped his comments would be in regard to new wind resources being developed, we weren’t surprised by the actual announcement: more public land will be strip-mined for coal.

“Coal is a critical component of America’s comprehensive energy portfolio as well as Wyoming’s economy,” Salazar said.

The new strip mines will be in the Powder River Basin and Salazar announced that they will yield an estimated 758 million tons of coal. The Powder River Basin already provides about 40% of the nation’s coal. Along with the coal comes countless jobs, billions in bids and royalties for both Wyoming and the federal government, and a marked increase in carbon dioxide emissions. Wyoming’s coal-fired power plants already emit more carbon dioxide in eight hours than the power plants of Vermont do in a year, and Vermont has more people, although Wyoming is the leading state in energy exports which helps to explain its emissions.

Salazar noted that the Obama administration is still committed to renewable energy, but with the stall of solar projects in California and this new coal sale, we have to wonder how deep that commitment is.

A Brazilian oil carnival?

 

Inside the Sambadrome during Brazil's Carnival. Image from Wikimedia

My Brazilian friends are recovering from their Rio carnival, which ended on Tuesday. One of these years, I’ve got to go and throw my Dutch, and usually somewhat reserved, self in the energetic mix.

Brazil is not just famous for its carnivalistic energy, but also for its liquid energy. In the Bush years, Brazil was heralded in DC as the big example for ethanol production. The sugarcane ethanol produced in Brazil would not make a great dent in our consumption. At its peak it is just under 0.5 million barrels per day, which is around two-thirds of the daily US ethanol production and under 3% of our total daily consumption. I am no fan of biofuels and would not applaud a growth in this area, not here and not anywhere. Sugarcane plantations in Brazil have driven other crops further into the Amazon leading to deforestation, have led to depletion and erosion of valuable land, and many have been proven to abuse large numbers of poor workers for the benefit of the few, as Father Tiago so passionately describes in his 2007 interview.

But, it is not really ethanol that Brazil is known for in liquid fuel circles. Instead it is its growth in oil and gas production, particularly offshore.  The oil, and gas, production in Brazil is predicted to increase dramatically in the next decades. Petrobras, the Brazilian oil company, is rapidly growing, in Brazil and overseas. In 1999, Petrobas was listed as the 27th largest energy company in the world. This year, it surpassed Chevron and Shell, based on total value (not on annual production) and entered the top 3. This is an incredible growth in just over a decade.

Petrobras' P-51 offshore platform, the first platform built entirely in Brazil. Image via Wikipedia

And Petrobras is hungry to expand further through a five-year investment program of over 200 billion dollars total. This should allow Petrobras to double its production in ten years to over five million barrels of oil per day. Where would it get all this extra oil and gas? The company would tap into the vast pre-salt reserves that have been discovered far offshore and very deep below the ocean floor.  These reserves are very hard to get to as they reside underneath large salt layers or domes. Pre-salt drilling requires much higher pressure than typical offshore oil and the salt layer may shift after drilling. Known for its technological know-how in deep and ultra-deep drilling, the company can probably get to the pre-salt oil, if investors bite. Investors are wary, though, after the BP disaster in the Gulf, and it is not clear if the confidence they have in Petrobras, which is a very well respected company in this field, is high enough to warrant the loans. The tenacious relation that Petrobras has with the Brazilian government doesn’t help. The government now also requires that Petrobras be the lead operator on offshore developments in Brazilian territory. Norway has similar requirements and it has served that country well. The Brazilian government no doubt hopes that revenues will help lift Brazil out of poverty and support its rapid growth.

Despite these uncertainties, there is no doubt that Brazil will be a strong and growing exporter of oil in the years to come. With a dwindling excess capacity in OPEC, and turmoil in the Middle East, this is perhaps not so bad.

Fractitious fracking?

Shale gas production featured strongly again today with a thought provoking article on fracking in the New York Times. I highly recommend it. It once again shows the strong role politics plays in energy production. This is no surprise since energy is a multi-billion dollar per day industry. It is also no secret that the fossil fuel industry, including the gas industry, spends millions on lobbying in Washington and at state levels.

I think that the pressure applied by the gas industry and supporters will lead to fracking permits, some of which will be given too hastily and without enough thought or oversight. What I hope is that the current debate, and the many protesting voices raised from other segments of the population, will help to caution the industry, and convince it that it is better to be safe than sorry.