Dubious LNG exports study was conducted in secret by contractor with ties to coal and oil industries
A study on the economic effects of exporting gas fracked in the US has opened the door for what Senator Ron Wyden (D-OR) and Congressman Edward Markey (D-MA) have called “a transfer of wealth from consumers to oil and gas companies.”
This particular study, which focuses on the economic impacts of exporting liquefied natural gas (LNG), was commissioned by the US Department of Energy, and will heavily influence the DOE’s decisions on the permitting of 15 proposed LNG export facilities.
Because of the way that exports of natural gas are regulated, the oil industry must convince the US Department of Energy that exporting America’s fracked gas is in the best interest of the country, in order for the DOE to approve any LNG export projects.
Alarmingly, the DOE kept the identity of NERA a secret from the public, and refused to answer Freedom of Information Act (FOIA) requests filed by Greenpeace, as well as requests from senators’ offices. The DOE’s excuse? According the DOE FOIA officer I spoke with, they didn’t want outside groups to “influence” the study.
It was Reuters that eventually revealed the identity of NERA, weeks before the DOE publicly released the the details of the contract. Reuter’s credited “industry sources” for the information.
So to recap, the DOE refused to tell the public the identity of group conducting an extremely important study on natural gas exports, citing a desire to protect the contractor from “influence,” a tacit admission that these studies are somehow corruptible. Then we find out that the notoriously unscrupulous gas industry knew the identity of the contractor before the DOE announced it publicly - the same gas industry willing to use psychological warfare techniques on rural Pennsylvanians - and it was the industry that leaked the contractor’s identity to the press.
Now the study has come out, and surprise, surprise, it says everything the gas industry wanted to hear. The NERA study supports the unlimited export of natural gas, which opens the door for the gas industry to sell fracked gas in foreign markets. Not only will that lead to higher gas prices here in the US, making fracking more profitable and therefore assuring the drilling of many more wells, but it also means more natural gas infrastructure, more methane leaks, and another blow to our already fragile climate. All the while increasing the profits of oil and gas corporations, like ExxonMobil.
According to NERA’s study:
"Across all these scenarios, the U.S. was projected to gain net economic benefits from allowing LNG exports. Moreover, for every one of the market scenarios examined, net economic benefits increased as the level of LNG exports increased. In particular, scenarios with unlimited exports always had higher net economic benefits than corresponding cases with limited exports."
Considering the DOE considers NERA to be vulnerable to outside influence, and we know the gas industry knew of NERA’s study before the public did, the NERA study and its results must be questioned.
Originally posted by Steve Horn at DeSmogBlog.
The Associated Press has a breaking investigative story out today revealing that the Obama Administration's Environmental Protection Agency (EPA) censored a smoking gun scientific report in March 2012 that it had contracted out to a scientist who conducted field data on 32 water samples in Weatherford, TX.
That report, according to the AP, would have explicitly linked methane migration to hydraulic fracturing ("fracking") in Weatherford, a city with 25,000+ citizens located in the heart of the Barnett Shale geologic formation 30 minutes from Dallas.
It was authored by Geoffrey Thyne, a geologist formerly on the faculty of the Colorado School of Mines and University of Wyoming before departing from the latter for a job in the private sector working for Interralogic Inc. in Ft Collins, CO.
This isn't the first time Thyne's scientific research has been shoved aside, either. Thyne wrote two landmark studies on groundwater contamination in Garfield County, CO, the first showing that it existed, the second confirming that the contamination was directly linked to fracking in the area.
It's the second study that got him in trouble.
"Thyne says he was told to cease his research by higher-ups. He didn’t," The Checks and Balances Project explained. "And when it came to renew his contract, Thyne was cut loose."
From Smoking Gun to Censorship: Range Resources Link
The Obama EPA's Weatherford, TX study was long-in-the-making, with its orgins actually dating back to a case of water contamination in 2010. The victim: Steve Lipsky.
"At first, the Environmental Protection Agency believed the situation was so serious that it issued a rare emergency order in late 2010 that said at least two homeowners were in immediate danger from a well saturated with flammable methane," the AP wrote.
AP proceeded to explain that Lipsky had "reported his family's drinking water had begun 'bubbling' like champagne" and that his "well...contains so much methane that the...water [is] pouring out of a garden hose [that] can be ignited."
The driller in this case was a corporation notorious for intimidating local communities and governmental officials at all levels of governance: Range Resources. Range, in this case, set up shop for shale gas production in a "wooded area about a mile from Lipsky's home," according to the AP.
As DeSmogBlog revealed in November 2011, Range Resources utilizes psychological warfare techniques as part of its overarching public relations strategy.
Due to the grave health concerns associated with the presence of methane and benzene in drinking water, the Obama EPA "ordered Range...to take steps to clean their water wells and provide affected homeowners with safe water," wrote the AP.
Range's response? It "threatened not to cooperate" with the Obama EPA's study on fracking's link to water contamination. The non-cooperation lead to the Obama EPA suing Range Resources.
It was during this phase of the struggle where things got interesting. As the AP explained,
Believing the case was headed for a lengthy legal battle, the Obama EPA asked an independent scientist named Geoffrey Thyne to analyze water samples taken from 32 water wells. In the report obtained by the AP, Thyne concluded from chemical testing that the gas in the drinking water could have originated from Range Resources' nearby drilling operation.
Despite this smoking gun, everything was soon shut down, with the Obama EPA reversing its emergency order, terminating the court battle and censoring Thyne's report. The AP explained that the Obama EPA has "refused to answer questions about the decision."
"I just can't believe that an agency that knows the truth about something like that, or has evidence like this, wouldn't use it," Lipsky, who now pays $1,000 a month to have water hauled to his family's house, told the AP.
"Duke Study" Co-Author Confirms Veracity of Thyne's Study
Robert Jackson, a Professor of Global Environmental Change at Duke University and co-author of the "Duke Study" linking fracking to groundwater contamination did an independent peer review of Thyne's censored findings. He found that it is probable that the methane in Lipsky's well water likely ended up there thanks to the fracking process.
Range predictably dismissed Thyne and Jackson as "anti-industry."
Americans Against Fracking: An "Unconscionable" Decision
Americans Against Fracking summed up the situation best in a scathing press release:
It is unconscionable that the Environmental Protection Agency (EPA), which is tasked with safeguarding our nation’s vital natural resources, would fold under pressure to the oil and gas industry...It is again abundantly clear that the deep pocketed oil and gas industry will stop at nothing to protect its own interests, even when mounting scientific evidence shows that drilling and fracking pose a direct threat to vital drinking water supplies.
There's also a tragic human side to this tale.
"This has been total hell," Lipsky told the AP. "It's been taking a huge toll on my family and on our life."
Written by Steve Horn, crossposted from DeSmogBlog.
Last year, a hydraulic fracturing ("fracking") chemical fluid disclosure "model bill" was passed by both the Council of State Governments (CSG) and the American Legislative Exchange Council (ALEC). It proceeded to pass in multiple states across the country soon thereafter, but as Bloomberg recently reported, the bill has been an abject failure with regards to "disclosure."
That was by design, thanks to the bill's chief author, ExxonMobil.
Originating as a Texas bill with disclosure standards drawn up under the auspices of the Obama Administration's Department of Energy Fracking Subcommittee rife with oil and gas industry insiders, the model is now codified as law in Colorado, Pennsylvania, and Illinois.
Bloomberg reported that the public is being kept "clueless" as to what chemicals are injected into the ground during the fracking process by the oil and gas industry.
"Truck-Sized" Loopholes: Fracking Chemical Fluid Non-Disclosure by Design
"Drilling companies in Texas, the biggest oil-and-natural gas producing state, claimed similar exemptions about 19,000 times this year through August," explained Bloomberg. "Trade-secret exemptions block information on more than five ingredients for every well in Texas, undermining the statute’s purpose of informing people about chemicals that are hauled through their communities and injected thousands of feet beneath their homes and farms."
For close observers of this issue, it's no surprise that the model bills contain "truck-sized" loopholes.
"A close reading of the bill...reveals loopholes that would allow energy companies to withhold the names of certain fluid contents, for reasons including that they have been deemed trade secrets," The New York Times explained back in April.
Disclosure Goes Through FracFocus, PR Front For Oil and Gas Industry
The model bill that's passed in four states so far mandates that fracking chemical fluid disclosure be conducted by FracFocus, which recently celebrated its one-year anniversary, claiming it has produced chemical data on over 15,000 fracked wells in a promotional video.
The reality is far more messy, as reported in an August investigation by Bloomberg.
"Energy companies failed to list more than two out of every five fracked wells in eight U.S. states from April 11, 2011, when FracFocus began operating, through the end of last year," wrote Bloomberg. "The gaps reveal shortcomings in the voluntary approach to transparency on the site, which has received funding from oil and gas trade groups and $1.5 million from the U.S. Department of Energy."
This moved U.S. Representative Diana DeGette (D-CO) to say that FracFocus and the model bills it would soon be a part of make a mockery of the term "disclosure."
"FracFocus is just a fig leaf for the industry to be able to say they’re doing something in terms of disclosure," she said.
"Fig leaf" is one way of putting it.
Another way of putting it is "public relations ploy." As Dory Hippauf of ShaleShock Media recently revealed in an article titled "FracUNfocusED," FracFocus is actually a PR front for the oil and gas industry.
Hippauf revealed that FracFocus' domain is registered by Brothers & Company, a public relations firm whose clients include America’s Natural Gas Alliance, Chesapeake Energy, and American Clean Skies Foundation - a front group for Chesapeake Energy.
Given the situation, it's not surprising then that "companies claimed trade secrets or otherwise failed to identify the chemicals they used about 22 percent of the time," according to Bloomberg's analysis of FracFocus data for 18 states.
Put another way, the ExxonMobil's bill has done exactly what it set out to do: business as usual for the oil and gas industry.
Written by Kyle Ash, crossposted from Greenpeace USA.
This morning, CEOs, founders, and other leaders of 68 organizations sent a letter to President Obama, urging that he do what he can to stop the dangerous extraction of shale gas that is occurring across the country without any federal public safeguards. Often called 'fracking,' communities from Pennsylvania to Texas to Minnesota are already suffering from the numerous environmental problems connected with this process to force “natural” gas from shale several thousand feet below ground.
The letter states,
'Fracking involves shooting millions of gallons of water laced with carcinogenic chemicals deep underground to break apart rock to release trapped gas. Despite its obvious hazards, regulation necessary to ensure that fracking does not endanger our nation’s water supply has not kept pace with its rapid and increasing use by the oil and gas industry.
To date, fracking has resulted in over 1,000 documented cases of groundwater contamination across the county, either through the leaking of fracking fluids and methane into groundwater, or by above ground spills of contaminated and often radioactive wastewater from fracking operations. Rivers and lakes are also being contaminated with the release of insufficiently treated waste water recovered from fracking operations. In addition, fracking typically results in the release of significant quantities of methane – a potent greenhouse gas – into the atmosphere despite the availability of cost-effective containment measures.'
Fracked gas may be no 'bridge fuel,' and it certainly is not 'clean energy.' Burning natural gas releases about half the greenhouse gas as burning coal, but fracked gas may produce so much more methane during extraction and processing that it could be as bad or worse than coal for the climate.
The oil and gas industry have good lobbyists, and have achieved years ago exemptions under virtually every federal environmental law, including the Safe Drinking Water Act and Clean Water Act. Companies like Conoco Phillips, Chesapeake Energy and Talisman Energy are not even required to disclose the more than 900 different chemicals used in the fracking process, which contaminate aquifers. Talisman has even targeted children in its lobbying, with 'Terry the Fracosaurus' who promotes an industry that is polluting drinking water with toxic chemicals.
Oil and gas companies have spent over three hundred million dollars in the last two years lobbying against federal protections from their pollution, so it is not too surprising that the federal government has decided to 'shoot now, ask questions later.' There are few efforts by Congress and the administration to mitigate the public health impacts of fracking.
In the next week or two we should see some results fom a panel of experts set up by the Department of Energy, which is supposed to reach conclusions on how to frack safely. However, the panel is stocked with only frack-friendly experts. EPA is studying impacts on water quality, but that study will take years to complete and is limited in its scope.
While further knowledge about impacts is a certainly a good thing, in this case 'more research' means political procrastination. EPA found 24 years ago that fracking contaminates water supplies. So far the only legislation to get much traction is the 'FRAC Act,' spearheaded by Democracts from Pennsylvania, New York, and Colorado. This bill is an important step to closing one legal loophole in the Safe Drinking Water Act, and would require that industry disclose which chemicals they're using.
In the wake of a New York Times series that revealed a serious lack of oversight of the gas industry by state regulators, the Governor of Pennsylvania has taken decisive action. He ordered the state Department of Environmental Protection not to report violations by gas companies without approval from his hand picked environmental chief. That’s right - Tom Corbett, the republican governor of Pennsylvania, ordered the Department of Environmental Protection to stop issuing violations against drillers without prior approval from DEP Secretary Micheal Krancer, who he personally selected as chief of the agency.
John Hines, the DEP executive deputy secretary, sent an e-mail March 23 to other senior staff, including four regional directors and the head of the department's oil and gas division.
"Effective immediately," it said, all violations must first be sent to him and another DEP deputy secretary in Harrisburg - with "final clearance" from Michael Krancer, DEP secretary.
"Any waiver from this directive will not be acceptable," Hines wrote. Regional directors reinforced the stern message in their own e-mails to staff.
Considering that notices of violation are the inspectors' main tool for enforcing compliance with environmental rules, Governor Corbett has basically kneecapped the DEP’s ability to control wayward hydrofrackers. The new policy has been met with disbelief and anger by people familiar with regulating the industry.
"They are putting us on a leash," said the one inspector, who spoke to the Enquirer on condition of anonymity because of a fear of retaliation.
Even John Hanger, ex DEP chief and good friend of fracking was against the directive. In an interview with the Enquirer, he said:
"I could not believe it. It's extraordinarily unwise. It's going to cause the public in droves to lose confidence in the inspection process." According to Hanger, there has never been a similar directive in DEP.
Hanger said the "extraordinary" policy was akin to forcing a highway trooper to get approval from the head of the state police before writing a ticket.
"It is a complete intrusion into the independence of the inspection process," he said.
Why would Corbett pander so brazenly to the Natural Gas industry? The Enquirer points out that Corbett received more than $800,000 in campaign contributions from drilling interests last year. A good investment for the fracking industry, considering that since taking office in January, Corbett's administration has overturned a moratorium on drilling in state forests and has refused to consider any extraction tax on drillers. Pennsylvania is the only major natural gas-producing state without such a tax.
A hydrofracking well pad in Pennsylvania. Image source
ExxonMobil, proud owner of the gas company XTO (bought in 2010 for $31B), attempted to parry criticism of the gas extraction process called hydraulic fracturing in a recent letter to the editor featured in the New York Times. The letter, written by Vice President Ken Cohen, contained all of the untruths and PR manipulations one would expect from the anti-climate, anti-environment, oil and gas supermajor ExxonMobil.
Ken writes in retaliation to a New York Times Business Day article by largely pro-gas and pro-industry “journalist” Christopher Swann, in which Swann refers to ExxonMobil’s strategy of forming a “united front against regulation" as “myopic.” Ken tacitly denies opposing regulation, saying “Along with other companies, ExxonMobil works with state regulatory authorities to develop sound, science-based regulations for oil and gas drilling.” If the implication of this statement is that Exxon supports legitimate fracking regulation, then this is a lie. Exxon opposes any attempt at regulation of their business reflexively and has opposed all attempts at regulation on fracking specifically.
Ken goes on to parrot the industry mantra of how vital “clean-burning” gas is for “national energy security” and “well-paying jobs.” No mention of how fracking poisons drinking water with radiation and toxic sludge. When weighing the importance of fresh water versus the “billions of dollars” that stand to be made by energy profiteers, Ken has definitely picked a side. Ken’s letter also spouts the common industry-created rhetoric that fracking has been used safely since 1940. The truth is that the type of fracking practiced currently is significantly different than the processes used since the 40’s, and none of these processes should be labeled 100% safe. Just ask the residents of Wiliamsport, Pennsylvania, where Exxon and XTO spewed 13,000 gallons of toxic sludge into waterways used for drinking water. So much for the “responsible development” touted by Ken Cohen and ExxonMobil.
In a ground breaking expose of the natural gas industry, Ian Urbina of the New York Times chronicles the dumping of radioactive watewater into the rivers and streams of Pennsylvania, among other abuses. The article describes how natural gas companies have taken advantage of lax regulation and unprepared regulators to thwart what few environmental safeguards exist to control gas extraction. Natural gas is extracted through a process called hydraulic fracturing, or fracking for short. This process uses millions of gallons of water, which becomes contaminated with heavy metals, radioactive elements, and other toxins. This wastewater must then be disposed of. In Pennsylvania the waste has been dumped into waterways, upstream of freshwater intake for cities and towns.
Here is a video describing the fracking process. Keep in mind it was made by Chesapeake Energy, a company heavily invested in hydrofracking, so there is no mention of what happens to the toxic wastewater.
Natural gas has long courted a "green" image because gas is less carbon intense than coal and some other fossil fuels. Gas companies have even gone as far as calling the burning of gas an inexpensive form of clean energy. However, the cost of natural gas is enormous: polluted water, the release methane (a powerful green house gas), exploding houses and water wells, cancer, and waste of money and capital that should be going to real clean energy (i.e. solar and wind).
The same oil and gas companies that set up a front group to campaign against regulations over hydraulic fracturing (“fracking”) have spent a combined total of more than $126 million on lobbyists, while pouring money into the campaign coffers of the Hill’s loudest fracking regulation opponents.
DeSmogBlog recently exposed “Energy in Depth” as an oil and gas front group set up to lead the charge against anyone legislating against or even investigating the dangers of hydraulic fracturing and other natural gas industry practices that pose public health and water contamination threats.
Purportedly set up to represent “small, independent oil and natural gas producers,” instead “Energy in Depth” is funded by some of the largest oil companies on the planet, such as Chevron, BP, Shell and Occidental, along with the American Petroleum Institute and other trade associations.
The “Independent” Petroleum Association of America (IPAA) memo obtained by DeSmogBlog was written in 2009, five days before the introduction of bills aimed at closing loopholes around the chemicals used in fracking.
In 2009, Congressional Democrats introduced two bills proposing to close the current loopholes around the use of chemicals used in fracking– The Fracturing Responsibility and Awareness of Chemicals (FRAC) Act (S. 1215), and The Fracturing Responsibility and Awareness of Chemicals Act of 2009 (H.R. 2766).
Greenpeace (thanks to OpenSecrets.org, DirtyEnergyMoney.com and MapLight.org) looked at the recent lobbying records of the giant oil and gas interests that describe themselves as “small and independent” operators that funded EID. During 2009 and 2010, the EID funders spent a combined $126.8 million on lobbying.
Of course these companies were also lobbying on other issues, but the two fracking bills were key issues listed in their lobby registration documents.
A ProPublica investigation into oil and gas money received by members of the Natural Gas caucus found that they received 19 times more money on average than members of Congress who signed a letter in support of a proposal to require fracking companies to disclose the chemicals they use when drilling on public lands.
All of the five members of Congress mentioned in the leaked “Energy in Depth” memo testified against the proposed legislation before it was tabled. For their efforts, each have received regular payments from a majority of EID members, including the IPAA itself. (See financial figures, compiled below)
The Congressional battles over regulation continue with Republican Representatives Joe Barton (R-TX) and Fred Upton (R-MI) taking up the issue late last year, and another key fracking supporter, Rep. Doc Hastings (R-WA) pressuring Ken Salazar to back off a proposal to introduce new regulations through the Department of Interior if Congress refuses to act.
2010: $5.51 million (some of this was likely spent to deny culpability in the Deepwater Horizon disaster due to their 25% stake in BP's Macondo well)
2009: $2.81 million
Total Anadarko lobbying and political contributions.
Dan Boren (D-OK), chair, House Natural Gas Caucus.
For the 2009-2010 election cycle Dan Boren raked in $216,250 from the oil and gas industry. He is the natural gas transmission and distribution industry’s top recipient, and second highest for the oil and gas industry. Among his funders are Chevron, Occidental, Anakardo, Marathon, and, of course, the Independent Petroleum Association of America.
Doc Hastings (R-WA)
At $84,671 in contributions, the oil and gas industry is Hastings' top contributing industry with regular payments from the EID member companies.
Hastings has been fighting any rules or transparency around fracking and its chemicals, writing to Ken Salazar late 2010 arguing that such rules would “ threaten thousands of jobs, deepen the federal deficit through reduced revenues, and harm natural gas development and our nation’s energy security.”
Doug Lamborn (R-CO)
Lamborn’s second-highest industry favorite was oil and gas, at $31,500, again with EID members prominent in the ranks.
Louie Gohmert (R-TX)
Gohmert raked in $48,550 in oil and gas money in the last election cycle. The oil and gas sector was his third highest donor by industry, a contributions from EID members included Chevron, Marathon and Halliburton.
John Fleming (R-LA)
Oil and gas was Fleming's second biggest earner at $123,500, including Chevron, Occidental, Marathon, IPAA, Halliburton.
Cynthia Lummis (R-WY)
Lummis’s top funders are the oil and gas industry, with $89,550 in 2010 dirty donations.
XTO Energy, a subsidiary of Exxon Mobil, is under investigation by the Pennsylvania Department of Environmental Protection (DEP) after a 13,000 gallon hydraulic fracturing fluid spill at XTO Energy's natural gas drilling site in Penn Township, Lycoming County, PA.
The spill was first discovered last week by a DEP inspector who found a valve had been left open on a 21,000-gallon fracking fluid tank, discharging fluid off the well pad into local waterways, threatening a nearby cattle herd that had to be fenced off from the contaminated pasture. Exxon/XTO has not provided an explanation on why the valve was left open.
“This spill was initially estimated at more than 13,000 gallons by the company and has polluted an unnamed tributary to Sugar Run and a spring,” said DEP Northcentral Regional Director Nels Taber. “There are also two private drinking water wells in the vicinity that will be sampled for possible impacts.”
DEP's sampling confirmed elevated levels of conductivity and salinity in the spring and unnamed tributary, clear indications that the fracking fluid was present in the waterways.
Exxon paid $30 billion in its June 2010 merger with Texas-based XTO Energy, making Exxon/XTO the largest natural gas producer in the United States, with extensive holdings of "unconventional resources" throughout the Marcellus Shale and elsewhere.
Concerns over natural gas fracking are widespread through the Marcellus Shale region and in several Western U.S. states where a boom in natural gas development is underway thanks to the controversial hydraulic fracturing technique. Residents living near fracking operations are on the front lines as their drinking water supplies and health are threatened by the fracking process, which involves injecting a mixture of sand, water and undisclosed toxic chemicals into the shale rock to free up the trapped gas.
Pennsylvania is no stranger to fracking disasters, notably the high-profile contamination in the town of Dimock, where resident Norma Fiorentino's water well famously blew up on New Year's Day 2009, and at least 15 families have had their drinking water ruined by fracking, leading to illness, livestock deaths and other maladies.
Last week, the Pittsburgh City Council banned natural gas fracking within city limits due to concerns over the threat of water contamination and public health risks.
But Pennsylvania is hardly alone in the fracking fight. Fracking operations have contaminated water supplies across America from New York, to Wyoming, to New Mexico, to Ohio, to Virginia, to Arkansas, to Colorado and beyond.
The Environmental Protection Agency currently has no power to regulate hydraulic fracturing thanks to the Halliburton Loophole inserted into the 2005 enegy bill at the behest of former Vice President Dick Cheney, the former head of Halliburton.
Mounting evidence of the fracking threat nationwide has yet to convince lawmakers to close the loophole and hold the natural gas industry accountable for its fracking messes. As the New York Times asked in a November 2009 editorial, "if hydraulic fracturing is as safe as the industry says it is, why should it fear regulation?"
Chevron underreports value of natural gas to pay less in royalties for 10 years, settled in court for $45.5 million
-New York Times, December 23, 2009