May 2009 Archives

Calif. gov. wants to revive oil drilling project

By the Associated Press

LOS ANGELES (AP) - Gov. Arnold Schwarzenegger is pushing legislation that he believes would raise $1.8 billion for cash-strapped California by allowing the first new oil drilling project off the state's coast in 40 years.

The governor's proposal would revive a project for the Santa Barbara coast that was rejected by the State Lands Commission in January. This latest fundraising suggestion comes on the heels of other money-making ideas that included selling state-owned properties such as San Quentin State Prison and the Los Angeles Memorial Coliseum.

The governor's legislation would give the Department of Finance - whose representative on the commission was the lone vote in support of the drilling project - authority to reconsider the proposal.

"It's got tremendous environmental benefits, and we can't turn a blind eye to the fiscal benefits," said Tom Sheehy, who represented state finance director Michael Genest in the commission's 2-1 vote.

The governor's support for the drilling project, which would expand drilling off Platform Irene in the Santa Barbara Channel, does not indicate a change in his opposition to offshore drilling, Sheehy said. The proposal would not violate the terms of the state's drilling moratorium, which includes an exception for any state oil field that drains into a federal oil field, he added.

Read the rest of this piece at Alaska Journal


Cooperative turns biomass into renewable energy

By Doug Rich

In January 2007 High Plains Journal featured a story about the Show Me Energy Cooperative in Centerview, Mo. At that time the farmer-owners of this unique cooperative were still conducting an equity drive to raise enough funds to begin their venture. Their goal was to produce an alternative energy source from renewable biomass resources in central Missouri.

Their equity drive was a success and so is their venture into alternative fuels. Today Show Me Energy Cooperative is in full production, manufacturing pellets from a wide range of biomass resources. The pellets they produce are being used by a coal-fired power plant, poultry producers in southern Missouri, and as a home heating source.

"We are still learning a lot of things, but I think the timeline was perfect for us," Steve Flick, chairman of the board at the cooperative, said. "Our mission was clear and focused."

What Show Me Energy Cooperative does is take the net energy value of the plant material and through an engineering process make a fuel pellet with an energy value around 8,100 to 8,300 BTU's per pellet. Flick said they leave 30 percent of the residue on the field and with an energy crop like a tall grass and they leave some around the fencerows for conservation benefits. Right now they are taking in a 50-50 mix of crop residue and energy crops.

"We think that will change with the Biomass Crop Assistance Program (BCAP) in the farm bill that will pay producers to grow energy crops and take them to a bio-refinery like ourselves," Flick said.

BCAP is designed to support agricultural producers in producing biomass crops and collecting biomass for sale to commercial-scale facilities that commit in writing to use the biomass to produce fuel or power.

With that in mind they are beginning a new equity drive to raise funds for an expansion project at their Centerville site. Flick said they had planned to expand some time in the next two years, but now they are going to expand in the next three months. This will be a smaller equity drive than their original drive, which was used to build their current facility.


Read the rest of this piece at High Plains Journal

House bill proposes new changes for drilling on public lands


Posted: 05/26/09 08:10 PM [ET]

would raise the royalties companies pay to drill on federal lands from 12.5 to 18.75 percent and shorten lease terms from 10 to five years.

Oil and gas companies, which still give twice as much to Republicans as to Democrats, are already fighting a push to repeal $31 billion in tax breaks and a climate change bill that could reduce demand for their products. They are now facing a third threat: the House Democratic bill that could cost the industry billions of dollars more for drilling on public lands.

"We are confronting a very difficult political environment," says Dan Naatz, vice president for federal resources and political affairs for the Independent Petroleum Association of America.

Supporters of the Democratic bill say the changes proposed in the Federal Lands and Resources Energy Development Act of 2009 are long overdue -- royalty payments haven't been increased since the 1980s -- and reflect what the companies would get in the market from private landowners.

Rising federal deficits provide more reason for the government to reassess what it charges to drill on its lands, backers argue.

"The federal government sits on incredibly valuable resources and it is about time we start maximizing the return to taxpayers," said Tyson Slocum, who directs Public Citizen's energy program.

To fight back, the industry says raising its costs will mean less domestic oil and gas production, which means greater dependence on foreign sources.

"This will be a great disincentive for companies to go out and explore," said Andy Radford, senior policy adviser at the American Petroleum Institute.

"If you increase the royalty rates, you affect the economics of a project."

Naatz said the changes will affect his group's members in particular, independent oil and gas companies that on average employ fewer than 20 workers, not the large companies like ExxonMobil that recorded record profits on high oil prices in recent years.

Backers counter that the proposed changes will align onshore royalty rates with what companies are already paying to drill offshore.

But Naatz and Radford said the finds offshore are usually much larger, making the prospect of paying higher royalties less of an economic incentive to drill onshore.

Read the rest of this piece at TheHill.com

by Phyllis


I've known about this oil field for quite some time. The problem however is that the oil is in shale and not only difficult but costly to extract. Environmentalists have nothing to do with it but seem to get the blame anyway. Only when gas hit $4.00 a gallon was there increased interest in the Bakken field. Now that prices dropped, it is no longer certain to be a big money-maker.  I found the following paragraph in an article on the Bakken oil field:

Although operators and the USGS have known about the resource potential of the Bakken Formation for many years, several factors made it very difficult to produce these resources. Early drilling in the Bakken Formation targeted the shale members. Success in these efforts hinged on connecting conventional vertical wellbores with an existing natural fracture system while not ruining the wellbore in the process with introduced drilling fluids. The shale itself is highly reactive with water and swells when exposed to it, which can seal off a productive fracture system. Also, the Bakken Formation contains iron pyrite within its sediments. This mineral forms an iron hydroxide precipitate (Figure 9 [see original document]) when exposed to hydrochloric acid, and there are reported cases of this phenomenon causing irreparable well damage. These challenges reduced the likelihood of success and discouraged most operators from trying to produce oil from the Bakken.

For more information see http://www.grinzo.com/energy/index.php/2008/04/03/bakken-boon-bust-or-boondoggle/

Author unknown, received this in an email.

OIL NO JOKE READ THIS AND PASS IT ALONG TO ALL...Unbelievable what the heck is wrong with these stupid politicians....

The U. S. Geological Service issued a report in April ('08) that only scientists and oil men knew was coming, but man was it big.  It was a revised report (hadn't been updated since '95) on how much oil was in this area of the western 2/3 of North Dakota ; western South Dakota ; and extreme eastern Montana ...... check THIS out:

The Bakken is the largest domestic oil discovery since Alaska 's Prudhoe Bay , and has the potential to eliminate all American dependence on foreign oil. The Energy Information Administration (EIA) estimates it at 503 billion barrels.. Even if just 10% of the oil is recoverable... at $107 a barrel, we're looking at a resource base worth more than $5.3 trillion.


'When I first briefed legislators on this, you could practically see their jaws hit the floor. They had no idea.' says Terry Johnson, the Montana Legislature's financial analyst.

'This sizable find is now the highest-producing onshore oil field found in the past 56 years.' reports, The Pittsburgh Post Gazette.  It's a formation known as the Williston Basin , but is more commonly referred to as the 'Bakken.'  And it stretches from Northern Montana, through North Dakota and into Canada .  For years, U. S. oil exploration has been considered a dead end.  Even the 'Big Oil' companies gave up searching for major oil wells decades ago.  However, a recent technological breakthrough has opened up the Bakken's massive reserves.... and we now have access of up to 500 billion barrels.  And because this is light, sweet oil, those billions of barrels will cost Americans just $16 PER BARREL!

That's enough crude to fully fuel the American economy for 41 years straight.

2. And if THAT didn't throw you on the floor, then this next one should - because it's from TWO YEARS AGO!

U. S. Oil Discovery- Largest Reserve in the World!
Stansberry Report Online - 4/20/2006



Hidden 1,000 feet beneath the surface of the Rocky Mountains lies the largest untapped oil reserve in the world. It is more than 2 TRILLION barrels.  On August 8, 2005 President Bush mandated its extraction. In three and a half years of high oil prices none has been extracted. With this motherload of oil why are we still fighting over off-shore drilling?

They reported this stunning news:  We have more oil inside our borders, than all the other proven reserves on earth. Here are the official estimates:


- 8-times as much oil as Saudi Arabia
- 18-times as much oil as Iraq
- 21-times as much oil as Kuwait
- 22-times as much oil as Iran
- 500-times as much oil as Yemen

- and it's all right here in the Western United States .

HOW can this BE? HOW can we NOT BE extracting this?  Because the environmentalists and others have blocked all efforts to help America become independent of foreign oil! Again, we are letting a small group of people dictate our lives and our economy..WHY?

James Bartis, lead researcher with the study says we've got more oil in this very compact area than the entire Middle East -more than 2 TRILLION barrels untapped.  That's more than all the proven oil reserves of crude oil in the world today, reports The Denver Post.

Don't think 'OPEC' will drop its price - even with this find?  Think again!  It's all about the competitive marketplace, - it has to. Think OPEC just might be funding the environmentalists?

Got your attention/ire up yet?  Hope so!  Now, while you're thinking about it .... and hopefully P.O'd, do this:

3. Pass this along.   If you don't take a little time to do this, then you should stifle yourself the next time you want to complain about gas prices .. because by doing NOTHING, you've forfeited your right to complain.

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Now I just wonder what would happen in this country if every one of you sent this to every one in your address book.

By the way...this is all true. Check it out at the link below!!!
GOOGLE it or follow this link.  It will blow your mind.
http://www.usgs.gov/newsroom/article.asp?ID=1911