Blog Archives

Energy producers frustrated with Obama state visit

image

Presidential motorcade prepares for President Obama's arrival

By Dan Potter

President Obama staging a photo op at the TransCanada pipe yard outside of Cushing today angers members of the Domestic Energy Producers Alliance.

DEPA’s Mike Cantrell says the President has proven for three years that he is against the fossil fuel industry.

“The irony of it is, he’s been unsuccessful because Congress wouldn’t go along with him. And now, he takes credit for the gains we’ve made in oil and gas production which have nothing to do with him and his policies. They’ve (occurred) in spite of him and his policies,” Cantrell said.

DEPA has cancelled plans to stage a protest in or near Cushing during the President’s visit.

“They’ve changed it from campaign visit to a state visit,” says Cantrell. “It’s not open to the  public.”

The President’s press entourage will be bussed from Oklahoma City to the Cushing event so even they wouldn’t come in contact with any protestors.

When asked what he’d say if he had a few minutes with President Obama, Cantrell says, “I’d say, Mr. President, we’d like to visit with you about domestic oil and gas. And that there’s a difference between U.S. domestic energy producers and royalty owners and the big oil companies that you seem to lash out at. But, in your lashing out at them, you have hit us all with your policies.”

Source

Obama said ready to push partial Keystone XL approval

Obama will be in Cushing, Okla., the start point of the pipeline’s southern half on Thursday

image

The Keystone XL project will extend TransCanada Corp.‘s Keystone pipeline that carries oil from northern Alberta to refineries in the United States. (TransCanada Corp.)

U.S. President Barack Obama is reportedly set to announce in Oklahoma this week that he’s expediting the permit process for the southern half of TransCanada’s controversial Keystone XL pipeline.

Citing a senior administration source, CNN reported on Tuesday that Obama wants to slash several months off a permit approval process that can ordinarily stretch on for as long as a year.

The administration wants to speed things up to deal with a glut of oil in Cushing, Oklahoma, where crude from the Midwest runs into a logjam on its way to refineries on the Gulf of Mexico.

Obama will make the announcement Thursday at a storage yard in Cushing, the starting point of the pipeline’s southern half.

Pipes that will be used to build Keystone XL to the Gulf Coast are being housed at the facility.

Gas prices rising

The announcement comes as prices at the pump continue to soar. Republicans are blaming Obama’s energy policies for rising gas prices and continue to attack him for rejecting Keystone XL in January.

The U.S. average price for a gallon of gasoline rose for the 11th straight day on Tuesday to $3.85 US, and soared to $4 a gallon in some states. That would amount to a little over a dollar a litre in Canada.

Millions of barrels of unrefined crude are sitting in storage facilities in North Dakota, in particular, but there’s a lack of pipeline capacity to carry it to the Gulf Coast and a limited number of rail cars that can transport the oil south. The state is currently in the throes of a major oil boom thanks to the discovery of the so-called Bakken Shale.

Obama’s recent praise of Calgary-based TransCanada’s decision to proceed with the construction of the southern segment of the pipeline signalled a shift in attitude from the White House after it rejected the pipeline outright in January.

The entire length of the proposed, $7.6 billion pipeline would stretch from Alberta’s oilsands through six U.S. states to the Gulf Coast.

No decision from State Dept.

The U.S. State Department has yet to make a decision on the pipeline, saying it needs more time to conduct a thorough environmental review of a new route around an environmentally sensitive aquifer in Nebraska. State department officials are assessing the project because it crosses an international border.

In November, under mounting pressure from environmentalists, the State Department deferred making a decision on Keystone until after this year’s presidential election, citing concerns about the risks posed to the aquifer.

Pipeline proponents cried foul, accusing Obama of making a cynical political move aimed at pacifying the environmentalists of his base and improving his chances of re-election.

Republicans then held the administration’s feet to the fire, successfully inserting pipeline provisions into payroll tax cut legislation in late December.

Within a month, facing a mid-February deadline imposed by that measure, Obama nixed TransCanada’s existing permit outright, saying there wasn’t enough time to thoroughly review a new route before giving it the green light.

But Obama also assured Prime Minister Stephen Harper that the decision did not reflect on the pipeline’s merits, but was merely necessitated by Republican pressure tactics. He welcomed TransCanada to propose another route.

Source

Politics sank Keystone XL, Exxon says

image

Published: March. 12, 2012 at 6:47 AM

HOUSTON, March 12 (UPI) — A decision to delay a permit for TransCanada‘s Keystone XL oil pipeline was based largely on U.S. politics, an energy executive said.

U.S. President Barack Obama in January denied a permit for TransCanada to build the billion-dollar Keystone XL oil pipeline. Republican leaders had tried to push the permit through by including the pipeline in a bill that extended payroll tax benefits. Obama rejected the permit because of an “arbitrary” deadline proposed in the legislation.

Exxon Mobil Chief Executive Officer Rex Tillerson told a major energy conference in Houston that industry leaders were practicing due diligence with the project but it was the U.S. political system that was getting in the way of development.

The decision to deny the initial permit for TransCanada, Tillerson said, was because of “political calculations” in Washington.

“In the end, it was also a disservice to public employees who are charged with overseeing this process and who met their obligations,” he was quoted by the Platts news service as saying. “We must continue to engage elected officials of the public to communicate the consequences of failing to move forward with such strategic opportunities.”

Backers of the pipeline describe it as a “shovel-ready” project that would shield the U.S. market from the effects that Middle East tensions have on the oil market. Critics say crude oil from Canada, designated for Keystone XL, is one of the dirtiest types of crude oil.

TransCanada can reapply after it settles on a route through Nebraska.

Read more: UPI

Obama lobby of Senate leads to defeat of Keystone pipeline

image

by Audrey Hudson

The Senate failed Thursday to overturn the White House’s decision to block construction of the Keystone XL pipeline due in part to a last-minute lobbying effort by President Barack Obama.

Obama’s efforts to head off defiance of his order through phone calls to Democratic lawmakers resulted in 56 yeas and 42 nays — four short of the 60 votes needed to pass.

“The president believes that it is wrong to play politics with a pipeline project whose route has yet to be proposed,” White House Press Secretary Jay Carney said when asked about Obama’s lobbying efforts earlier in the day.

The amendment to the highway bill authored by Sen. John Hoeven (R- N.D.) would have stripped the president of his authority to deny the needed permit to build the cross-border pipeline from Canada to Texas.

“Frankly, it’s hard to even comprehend how out of touch (Obama) is on this issue,” said Sen. Minority Leader Mitch McConnell (R-Ky.).

“I mean, think about it: at a moment when millions are out of work, gas prices are skyrocketing and the Middle East is in turmoil, we’ve got a president who’s up making phone calls trying to block a pipeline here at home. It’s unbelievable,” McConnell said.

Sen. Orrin Hatch (R-Utah) told Obama to put down the phone and stop lobbying against the creation of new jobs. Republicans tout the pipeline as the nation’s largest shovel-ready project that would create 20,000 jobs.

“This is ridiculous, with price of gas soaring, the president blasts anyone who criticizes his lack of an energy strategy, but then he’s lobbying to stop a common-sense amendment allowing Keystone XL pipeline to move forward,” Hatch said.

That measure was further diluted by an alternative amendment offered by Sen. Ron Wyden (D-Ore.) that would eventually approve the project but also sought to block any export of oil brought into the U.S. to be refined.

“A vote for (Wyden’s) bill is a vote to block the project, make no mistake,” Hoeven said.

Wyden said his amendment would ensure that all of the oil would be used by American consumers and not sold to China.

“When you build a pipeline 2,000 miles across the nation, our challenge is to do it right,” Wyden said.

Wyden’s amendment also failed on a vote of 34 yeas to 64 nays.

“Millions of miles of pipelines cross this country, but for some reason, this one pipeline is a problem?” Hoeven said.

TransCanada has announced that it will go ahead and construct one leg of the project that extends from Oklahoma to Port Arthur, Texas, and will push ahead for the permit to cross the northern border next year.

Meanwhile, Energy Secretary Steven Chu testified before a House panel earlier in the day where he faced questions about the pipeline and previous comments he made that the administration’s goal was not to lower gas prices.

“The president and everybody in the administration want to do what we can to lower the price of gasoline because it has a severe effect on the pocketbook of Americans and it affects American businesses,” Chu told the Energy and Commerce subcommittee on energy and power.

“There is no single magic bullet that can instantaneously do that,” said Chu, who also told the panel he does not own a car.

Some lawmakers were not convinced that the administration is doing all it can to lower gas prices.

“What has the president done to help solve our energy problems?” asked Rep. Fred Upton, (R-Mich.), chairman of the full committee.

“President Obama has twice rejected the Keystone XL pipeline project and all the job creation and secure energy supplies it would deliver,” Upton said. “The president has recently begun to brag that he supports an ‘all of the above’ energy policy, but these actions look more like a policy of ‘nothing from below.’”

Chu was criticized last week after he suggested to the House Appropriations Committee that the Obama administration was not working to reduce the price of gas. Asked by Rep. Alan Nunnelee (R-Miss.) then if the overall goal was to bring down the price of gasoline, Chu said “no.”

[ Energy Secretary Chu Admits Administration OK with High Gas Prices ]

“The overall goal is to decrease our dependency on oil, to build and strengthen our economy,” Chu said.


Audrey Hudson, an award-winning investigative journalist, is a Congressional Correspondent for HUMAN EVENTS. A native of Kentucky, Mrs. Hudson has worked inside the Beltway for nearly two decades — on Capitol Hill as a Senate and House spokeswoman, and most recently at The Washington Times covering Congress, Homeland Security, and the Supreme Court.  Follow Audrey on Twitter and Facebook.

Source

Removing the disconnect between talk and action on energy policy

image

March 2, 2012 | Posted by Ken Cohen

Let’s be clear: The U.S. oil and natural gas industry does not receive special “subsidies” or “preferences.” Such claims simply don’t accord with the facts.

The fact is that what some call “subsidies” are legitimate provisions of the U.S. tax code that treat our industry the same as other industries. The efforts to prevent oil companies from accessing these provisions achieve nothing but raising the tax burden on the companies that find, produce and manufacture the fuels that are the foundation of the U.S. economy.

One example is the Section 199 domestic production activities provision, which exists to support new investment and employment opportunities across U.S. industries. Those who produce or manufacture items in America, including auto makers, software developers, movie producers, and newspaper publishers, qualify for it. Yet critics call this a “subsidy” for those who produce the oil and natural gas used by American consumers – this despite the fact that our industry actually gets a smaller Section 199 deduction than all other qualifying industries.

Another example is the deduction for the costs of drilling the wells to produce domestic oil and natural gas. The U.S. tax code allows companies, no matter the industry, to recover their costs in earning income. So denying or delaying the deduction of our industry’s costs – largely the salary costs of those drilling oil and gas wells – will treat our industry differently than most others. Furthermore, such measures will actually increase the costs of producing oil and natural gas in the U.S.

These are just a couple of examples of what critics are referring to when they erroneously claim that oil and gas companies receive $4 billion per year in special “subsidies” or “preferences.” When these measures are combined with other proposals to increase the industry’s taxes, they amount to an $85 billion tax hike for the U.S. oil and gas industry over the next decade – and untold consequences for U.S. energy security and global competitiveness.

What such proposals will do is increase costs for a company to manufacture a product. It is hard to see how increasing costs on manufacturers helps American consumers.

The reality is that we need to put in place the policies now that will help address our long-term energy needs. Instead of trying to convince people that standard tax provisions are actually special-interest subsidies, our nation would be better served by policies that encourage more energy development so that industry can increase supplies to the market.

We could start by increasing access to America’s own resources.

Currently, about 85 percent of all U.S. offshore areas remain off-limits to oil and gas development. As I’ve mentioned before, a recent study shows that polices that support greater access to resources in the U.S. and Canada would not only increase domestic supplies, but would also create 1.4 million jobs and generate more than $800 billion in government revenue by 2030.

One of those job creators is the Keystone XL pipeline, but that’s not the only reason it should be approved. In Canada, our industry is developing oil sands that are giving us access to one of the world’s largest-known reserves of energy – approximately 170 billion recoverable barrels, or the energy equivalent to fueling today’s North American vehicle fleet for about 35 years.  The energy industry’s innovative techniques and technologies are allowing us to develop these resources in safe and environmentally responsible ways.

If our nation’s leaders were to consider our industry’s contributions to the economy and to government revenue, the conversation could be more constructive. U.S. oil and natural gas companies contribute much more to the U.S. economy than the oil and gas that fuel it. For example, in 2011, ExxonMobil alone contributed $72 billion to the U.S. economy by paying our taxes, producing returns for our shareholders, paying our employees and investing in energy projects around the country. Our $12 billion in U.S. taxes to local, state and federal governments in 2011 exceeded our U.S. operating earnings by more than $2 billion.

I encourage you to compare what’s being said with what’s actually being done when it comes to policies that support domestic energy development. There’s a disconnect between the two.

Source

Voodoo Environomics

image

By H. Leighton Steward
Posted on Feb. 16, 2012

President Obama’s rejection of the Keystone Pipeline wasn’t, as he claimed, based on science or the environment. And it certainly wasn’t based on sound economic policy. The decision was, in fact, the product of Voodoo Environomics: a destructive blend of bad science based on fear-mongering and manipulated research with the bad economics of green job fantasies and “starve the beast” energy politics.

At the very heart of Voodoo Environomics is, of course, the much-hyped theory linking man-made CO2 and climate change. Without the world’s policy focus on CO2 emissions, climate change alarmists would be robbed of the ammunition they need to change and control human behavior via draconian energy policies. They’d also be robbed of the substantial financial support needed to continue their biased research.

When adopted as official government policy, Voodoo Environomics can wreak havoc on the economy and represents a double whammy for working Americans. The admitted goal of CO2-slashing schemes like Cap & Trade is to jack up the price of energies like gasoline and coal to make expensive alternative energies more financially competitive. Of course their proponents hope you don’t realize that it’s ordinary Americans who are stuck paying higher prices for utilities and gasoline.

But the hit working Americans take under Voodoo Environomics doesn’t end with higher utility bills and gas prices. In bowing to environmental extremists in rejecting the Keystone Pipeline project, Obama has abandoned working Americans… or should I say unemployed Americans in search of good jobs.

In fact, Obama managed the rare feat of uniting business and labor in crying foul over this senseless decision. Jay Timmons, CEO of the National Association of Manufacturers decries the loss of 20,000 direct jobs and another 118,000 spinoff jobs that would have resulted from Keystone. Standing next to him, Terry O’Sullivan, head of the Laborers’ International Union of North America said, “Blue collar construction workers across the U.S. will not forget this (decision).”

The application of Voodoo Environomics also puts style over substance. Obama’s rejection of Keystone won’t stop the extraction of oil from Canada’s oil sands – the primary objective behind the pressure to kill the project. Canada will proceed without pause in exploiting their oil sands, regardless of what American politicians or environmental extremists say or do.

Anti-Keystone activists also point to the need to protect the Ogallala Aquifer, which encompasses parts of eight states and underlies a portion of the proposed route of the Keystone pipeline. But reviews of the thousands and thousands of miles of oil and natural gas pipelines over the Ogallala, some of which have been transporting oil for more than a half a century, show no contamination of the aquifer.

What it does do is ensure that oil won’t be shipped and refined by Americans and will likely go to other nations, particularly China. This may sound like hyperbole, and I wish it were. But Canadian Prime Minister Stephen Harper, in lambasting Obama’s rejection of Keystone, said that Canada would look to China to sell their oil.

America’s energy insecurity is moving into a dangerous new phase while our economy remains anemic and unemployment systemic. Rather than strengthening America’s energy position with a close ally and neighbor like Canada, Obama has increased our dependence on energy supplies from less-friendly nations that ensure little or no environmental safeguards.

The negative impact of this decision doesn’t end there. America’s risk exposure to dangerous energy disruptions stemming from global hotspots just went up. Such disruptions, such as those that could result from a crisis such as one brewing in the Straits of Hormuz, would be personal disaster for working Americas and a significant national security crisis for America.

The phantom gains and real losses stemming from Voodoo Environomics are starting to be realized. America needs more opportunities, not lost opportunities. Unfortunately for working Americans, there’s a greater abundance of the latter.

H. Leighton Steward is a geologist, environmentalist, author, and retired energy industry executive. He currently chairs the organization Plants Need CO2.

Source

Energy secretary backs natural gas exports

image

The low price of natural gas is hurting domestic job growth, and exporting a small amount of the fuel will boost the economy, U.S. Energy Secretary Steven Chu told a Houston audience Thursday.

Speaking at a town hall at Houston Community College, Chu said a modest increase in the price of natural gas wouldn’t significantly raise its cost to U.S. consumers who use it to heat their homes and manufacturers who need it to make products.

Natural gas futures closed at $2.55, up 17 cents, in trading Thursday on the New York Mercantile Exchange. It brings much higher prices in other countries.

“Exporting natural gas means wealth comes into the United States,” Chu said.

The Energy Department’s Office of Fossil Energy is reviewing several applications to export liquefied natural gas. The exports would relieve the glut of natural gas on the domestic market and raise revenue, but also potentially increase prices for domestic consumers.

Several U.S. energy companies have announced plans to close their natural gas wells and curb spending in natural gas fields, as its price has fallen from more than $13.50 in 2008.

In his State of the Union speech last week, President Barack Obama called for an “all-of-the-above” approach to domestic energy production, including investment in oil, natural gas and renewable energy sources.

Chu said it’s important that the United States be at the forefront of innovations and technologies in renewable energy.

“We have a choice. When all these things become cost-competitive, do you want to buy or do you want to sell?” he asked. “If we are buying, that is wealth out of the country. If we are selling, that’s wealth into the country.”

Before the hour-long session with students at the college, Chu met with oil and gas executives and explored the Texas Medical Center’s energy efficiency upgrade.

At the college, he answered questions about the Obama administration’s rejection of the Keystone XL pipeline and Iran’s threat to close the Strait of Hormuz, among other topics.

Chu said the administration is open to exploring alternate routes for the pipeline that would carry oil from Canadian tar sands to Gulf Coast refineries.

It’s become a touchstone issue for supporters who say it will create jobs and reduce U.S. dependence on oil from hostile nations, and opponents who argue it could threaten water supplies and promote use of an especially dirty form of oil.

image

Photo: Melissa Phillip / © 2011 Houston Chronicle

 

Chu said he supports construction of pipelines nationwide, particularly to relieve the glut of oil at the hub in Cushing, Okla., a major price point for domestic oil.

“There is such a shortage of pipelines between Cushing and Houston,” Chu said. “There will be major construction of pipelines in the next decade or so. All the job creation from Cushing to Houston is being done now.”

Chu touted government investment in wind, solar and other renewable energy sources, as well. He said he expects the cost of solar power to fall by 50 percent within six to eight years.

Chu also dismissed Iran’s threats to close the Strait of Hormuz, a key oil shipment channel, in retaliation for international sanctions aimed at the nation’s nuclear program.

“I don’t think they can really shut down the Strait of Hormuz,” Chu said. “We certainly have capabilities to reopen it.”

simone.sebastian@chron.com @SimonesNews

Source

Obama’s dishonest energy promise

imageDespite pledge, government hasn’t allowed drilling on 97 percent of coast

President Obama’s ambiguous call to “open” 75 percent of the country’s potential offshore oil and natural gas resources to exploration may sound generous, but the truth is, the areas containing those resources are technically already included in the upcoming 2012 to 2017 offshore leasing plan, and they are virtually the same areas where exploration and production have been allowed for decades.

Look beyond the president’s rhetoric to his record and it becomes clear that jobs and energy security are not high priorities for this administration. The shortsighted decision to deny the Keystone XL pipeline and the unnecessarily long moratorium on drilling in the deep waters of the Gulf of Mexico are but two examples.

Political uprisings and social unrest over the past year have highlighted the instability of oil-producing regions in the Middle East and North Africa, and the situation shows no signs of improvement. Just a few weeks ago, Iran threatened to shut the Strait of Hormuz, a critical transport route for 40 percent of the world’s oil. A robust domestic oil and natural gas industry can shield the U.S. market from such events and protect the American consumer. Unfortunately, our current policies have failed.

Around the same time as the Iranian announcement, the American Petroleum Institute unveiled a Quest Offshore Resources study showing that the deep-water drilling moratorium and subsequent permit slowdown forced 11 deep-water rigs to leave the Gulf of Mexico since 2010, taking their jobs and investments to the shores of Brazil, Africa and elsewhere. Those moves translated to a loss of $21.4 billion for our economy and an estimated 72,000 jobs in 2010 and 90,000 jobs in 2011, according to the study. We must do better.

An earlier Quest study rolled out by the National Ocean Industries Association showed that if permitting rates surpassed pre-2010 levels, 190,000 offshore industry-supported jobs could be created nationwide within the next two years without a single dime of government stimulus. The positive benefits of returning the Gulf-permitting rates to higher, more consistent levels are clear. But the Gulf represents only a portion of our nation’s offshore resources. Alaska’s outer continental shelf holds immense potential, with almost 10 billion barrels of oil and 15 trillion cubic feet of natural gas lying untapped beneath the ocean floor. Approval of exploration permits would mean 55,000 new jobs and $145 billion in new wages. The federal government would also see a significant amount of new revenue – approximately $193 billion.

There are also considerable resources off the coast of Virginia, where residents and state leadership support exploration. Unfortunately, the Department of the Interior has yet to allow the industry to move forward there. In addition to denying Virginia’s desire for an offshore lease sale, the department’s 2012 to 2017 proposed oil and gas leasing program keeps the eastern Gulf and the Atlantic and Pacific coasts off-limits to exploration and delays development in Alaska. This sends job creation elsewhere, and closes the door on economic growth.

Despite the vital revenue generated, jobs created, wages paid and increased energy security, less than 3 percent of the federal outer continental shelf is leased, leaving more than 97 percent of these resource-rich areas devoid of any permits. I cannot think of a more glaring, missed opportunity. We simply cannot continually place our nation at the mercy of hostile nations while we ignore our own energy potential. Significant oil and natural gas resources lie off our coasts and across our northern border, waiting to enhance our energy security and help stabilize fuel prices. We need to go get them. The time has come for Congress and the president to put aside rhetoric and ideological debates, pass meaningful legislation that will open our offshore domestic resources for exploration and development, stop sending our hard-earned dollars to hostile and unfriendly nations, and invest in America’s future.

Randall Luthi is president of the National Ocean Industry Association

Source

%d bloggers like this: