Daily Archives: October 25, 2011

Gas is ‘a Threat, Not a Bridge’ to Renewables

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Natural gas, once seen as a useful bridge between the eras of coal and renewables, poses one of the biggest threats to the wind-energy business, if not the whole future clean-tech revolution, according to experts.

“We’ve talked over the last decade of gas as a bridging technology, but we’re now seeing what I would call the threat of gas,” James Leape, director-general of WWF International, told the European Future Energy Forum in Geneva, Switzerland.

“Maybe gas does have a role as a bridging fuel. But now you have people like the chief executive of Shell [Peter Voser] talking about gas as a destination fuel.

“Frankly, if we build the future economy on shale gas, we will have lost the fight to control ­climate change.”

The US energy sector has been transformed by the ability to tap huge reserves of shale gas economically, employing a controversial technique known as hydraulic fracturing — or fracking — in which subterranean layers of impermeable rock are cracked open using pressurised fluids.

Shale-gas fever has spread to Europe, with drilling companies claiming that Poland, Romania, the UK and other countries have large, accessible deposits.

While many observers — including the Obama administration and the International Energy Agency (IEA) — believe the shale-gas boom will have useful medium-term environmental consequences compared to the high carbon emissions of coal, others believe it is more harmful once its extraction methods are taken into account.

Fracking has been banned in France, Switzerland and several US states. The intense water demands imposed by the technique are also a concern.

Markus Wråke, head of the IEA’s Energy Technologies Perspective group, says the shale-gas boom — rather than the explosion of renewables — has proved the most disruptive change to the energy industry in recent years.

“In some settings, gas is an enormous improvement over coal,” he says. “The question is: when does gas go from being part of the solution to part of the problem?

“We could see significant synergies with other fuels we believe are important over the longer term, like biogas and hydrogen. But the fact remains that if we have really low gas prices, it could threaten the development of some of the clean technologies that we need.”

Anders Eldrup, chief executive of Danish utility Dong, describes the future of shale gas in Europe as “still very much a question mark”.

But far from being an enemy of renewables, natural gas is “not only a companion, but a very necessary one”, he tells Recharge.

“The beauty of gas as a complement to fluctuating renewables is it’s so fast: you press a button and the gas-fired power station starts up. It’s much more flexible in that respect than coal, and it’s not as polluting,” Eldrup adds.

“From our perspective, wind, biomass and gas form the basis of our future energy mix — you can’t do without any of them.”

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Hess to spend $2.3 billion to develop Gulf of Mexico oil field

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Hess Corp., the New York-based oil company, will develop its Tubular Bells deep-water field in the Gulf of Mexico at an estimated cost of $2.3 billion.

Production is expected to begin in 2014 and may peak at the equivalent of 45,000 barrels of oil a day, Hess said in a statement today. Subject to U.S. approval, Hess said it will own 57 percent of the field, with Chevron Corp. holding the remainder. BP Plc no longer owns a stake in the project.

Tubular Bells holds an estimated 120 million barrels of oil, Hess said. Plans call for three wells in the field, which lies as much as 4,600 feet (1,400 meters) below the surface about 135 miles southeast of New Orleans, the company said.

The field will be predominantly oil with “good, attractive returns, even though the costs per well have gone up a little bit with the new government regulations,” John Hess, chairman and chief executive officer of the company, said in a Sept. 8 speech.

The U.S. government imposed new drilling rules after a BP well in the Gulf last year had the biggest offshore oil spill in the nation’s history.

Hess fell 2 percent to $59.81 at 11:21 a.m. in New York. The shares have declined 22 percent this year.?

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USA: Environmental Groups Challenge EPA’s Permits for Shell’s Drillships

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On October 21, the U.S. Environmental Protection Agency issued an air pollution permit for the Kulluk drill ship that Shell Offshore Inc. plans to use in offshore oil drilling efforts that could begin as early as next summer.

Yesterday, on behalf of the Native Village of Point Hope, Resisting Environmental Destruction of Indigenous Lands (“REDOIL”), Alaska Wilderness League, Center for Biological Diversity, Natural Resources Defense Council (“NRDC”), Northern Alaska Environmental Center, Ocean Conservancy, Oceana, Pacific Environment, Sierra Club, and The Wilderness Society, Earthjustice filed an appeal with the EPA’s Environmental Appeals Board challenging a similar EPA permit for the Discoverer drill ship that the agency approved last month.

The following statement is from Earthjustice attorney Colin O’Brien:

“The EPA essentially is green-lighting dangerous Arctic Ocean oil drilling by approving the air permit for the Kulluk drill ship. Shell Oil​ has proposed a massive drilling operation in one of the most remote places on the planet. Each year, this fleet of ships could emit 30 tons of particulate matter, 240 tons of nitrogen oxides and 80,000 tons of carbon dioxide. Not only is oil drilling risky, these ships would double the amount of global warming pollution produced by roughly all of the North Slope Borough households.

“This permit for the Kulluk marks the beginning of a wave of potential offshore industrial activity in the Arctic. Unfortunately, on the eve of a potentially massive influx of oil company development, the EPA has turned a blind eye to the cumulative impacts that would be harmful to the health of Alaska Natives and the environment for years to come.

“The EPA unfortunately has already approved another drill ship permit, for the Discoverer. That permit ignored the impacts these drill ships will have on air quality in the region and we filed an appeal today with the EPA’s Environmental Appeals Board challenging the Discoverer permit.

“Arctic Ocean oil drilling is simply a bad idea. In an area with 20-foot sea swells, walls of ice 6 feet thick, and complete darkness two months out of every year, the thought of cleaning up an oil spill is ludicrous. The EPA’s decisions on these air permits moves us closer to the inevitable disaster that would be a large oil spill in the Arctic Ocean.”

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