The U.S. Environmental Protection Agency (EPA) has updated oil and gas storage tank emission standards issued in April 2012 to allow the phase-in of emission control deadlines and to alleviate confusion over implementation. Higher-emitting tanks will be affected by the new requirements first. The rule changes also provide time for operators to acquire and install necessary emissions controls. The changes are in response to stakeholder comments that revealed that more storage tanks will be coming online than EPA had originally thought. Storage tanks that emit six or more tons of volatile organic compounds (VOC) per year must reduce emissions by 95%. Two control deadlines were established by the latest changes. Tanks that come online after April 12, 2013 are likely to have higher emissions and must control VOC emissions within 60 days or by April 15, 2014, whichever is later. Tanks that came online before April 12, 2013 are likely to have lower emissions and must control VOC emissions by April 15, 2015. The updated standards also establish an alternative emissions limit that would allow owners/operators to remove controls from tanks if they can demonstrate that the tanks emit less than four tons per year of VOC emissions without controls.
Responding to the July 6 derailment and explosion of a crude-laden train in Quebec, the U.S. Department of Transportation's Federal Railroad Administration (FRA) has issued an Emergency Order and Safety Advisory to help prevent trains operating on mainline tracks or sidings from moving unintentionally. The emergency order mandates that within 30 days all railroads must undertake several measures. Included in the order is a prohibition on trains transporting specified hazardous materials, including flammable gas or flammable or combustible liquids, from being left unattended on mainline or side tracks outside yards or terminals, unless specifically authorized, and regulation of the use of hand brakes on trains. The Safety Advisory, issued with the Pipeline and Hazardous Materials Safety Administration (PHMSA), includes a list of recommendations railroads are expected to follow. FRA and PHMSA recommend that railroads review crew staffing requirements for transporting hazardous material and ensure that they are adequate, conduct system-wide evaluations to identify particular hazards that may make it more difficult to secure a train or pose other safety risks and to develop procedures to mitigate those risks.
The Pennsylvania Department of Environmental Protection has finalized air quality permit criteria and will no longer unconditionally exempt operators from submitting a plan prior to the approval of unconventional drilling sites. The agency may grant exemptions, but operators would need to adhere to a tougher set of standards, even more stringent than federal rules. The new rules include requiring a leak detection and repair program for an entire well pad and facility, and that repairs be made within 15 days, unless the operator shuts the site down or is in the process of acquiring replacement parts. Emissions of volatile organic compounds (VOC) and hazardous air pollutants also have more stringent rules. Nitrogen oxide emissions have to be less than 100 pounds per hour, half a ton per day and 6.6 tons per year; federal rules do not address or limit such emissions. The state agency also said it would allow open flaring, but only on a short-term or emergency basis.
The Department of Energy (DOE) should move forward on all liquefied natural gas (LNG) export applications "in a timely manner," development of natural gas resources should be a priority for the United States, and lawmakers should help clear the way by opposing any polices that would delay or prohibit LNG exports, according to a report by Sen. Lisa Murkowski (R-AK), the ranking member on the Senate Energy and Natural Resources Committee (see related story). "The Narrowing Window: America's Opportunity to Join the Global Gas Trade," was presented to "Energy 20/20: A Vision for America's Energy Future," a report unveiled by Murkowski earlier this year (seeNGI, Feb. 11). The new report echoed many of the themes laid out in Murkowski's earlier vision, which argued that the nation's energy discourse is "just not keeping up" with recent changes in the energy industry.
The U.S. Environmental Protection Agency (EPA) wants to drop its previously proposed effort to develop effluent guidelines for coalbed methane (CBM) extraction, according to a notice in theFederal Register. In an announcement of the availability of its Preliminary 2012 Effluent Guidelines Program Plan and its 2011 Annual Reviews, EPA said it "is proposing to delist from the effluent guidelines plan the rulemaking for the coalbed methane extraction subcategory based on new information regarding the declining prevalence and economic viability of this industry, due in large part to the increased extraction of natural gas from other sources, such as shale formations." CBM's reduced market share could make it cost prohibitive for those in the industry to meet control measures EPA would put in place, the agency said. EPA will accept public comments on the proposal until Oct. 7.
Western Gas Partners LP has agreed to acquire the Overland Trail Transmission Co.(OTTCO) Pipeline in southwest Wyoming from Denver-based DCP Midstream LLC for $27.5 million. CEO Donald Sinclair said the pipeline would connect the Patrick Draw and Granger facilities. Western, whose parent company is Anadarko Petroleum Corp., expects the pipeline to generate $3.5 million annually in earnings. The OTTCO is about 110 miles long with various pipeline diameters.
NGL Energy Partners LP has acquired the water disposal and hauling business of Oilfield Water Lines LP, a partnership with High Roller Wells and Mark Cuban Companies, for 2.46 million common units and $168 million in cash, plus net working capital. Tulsa-based NGL said the acquisition expands its water services business by adding four high capacity, strategically located oil and natural gas water disposal facilities to its portfolio of water treatment and gathering infrastructure. The acquisition brings approximately 90,000 b/d of additional disposal capacity in the Eagle Ford Shale in South Texas. NGL increased its fiscal 2014 adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) guidance from $240-245 million to $255-260 million. For the full twelve months ending March 31, 2015, NGL anticipates adjusted EBITDA from the transaction to exceed $35 million.
The Michigan Chamber of Commerce has launched a campaign to educate voters about the state's oil and natural gas business in an attempt, among others, to prevent any municipal or legislative bans on unconventional drilling. The board of directors recently voted unanimously to support responsible energy exploration in Michigan and to oppose any attempt to ban the use of hydraulic fracturing, "including a false and misleading petition drive" by environmental activists," said CEO Rich Studley. Earlier this year drilling opponents began a petition drive to collect signatures for a place on the 2014 state ballot about whether to allow horizontal drilling practices to be used by Michigan operators (seeNGI, April 22). The group proposes to amend the state's Natural Resources and Environmental Protection Act. The Chamber's campaign includes billboards posted across the state and a website to help educate voters about the benefits of energy growth.
Portland General Electric (PGE) is continuing with a $1.3 billion in three generation projects, two of which would be natural gas-fired facilities, CEO Jim Piro said. The Oregon-based utility's investments -- a 220 MW gas-fired peaking facility at the existing Port Westward plant; a 440 MW gas-fired Carty on part of an existing Boardman coal-fired generation installation that is targeted for retirement; and a 267 MW wind project. Scheduled for startup in 1Q2015, the $300 million Port Westward peaker may result in a 3-4% rate increase for customers. The $450 million Carty baseload project is expected to be operational in mid-2016.
At the recent AirVenture 2013 air show in Oshkosh, WI, a first-ever dual fuel compressed natural gas (CNG) powered aircraft was introduced by Aviat Aircraft Inc. and the Aviation Foundation of America Inc. The Aviat Husky CNG was billed as the world's first dual fuel, piston powered aircraft to operate on CNG and aviation gasoline. Aviat fitted its standard Husky A1-C with a CNG fuel tank to its standard 50-gallon aviation gasoline tanks to fuel the 200-hp, four cylinder Lycoming aircraft engine with a 143 mph cruising speed. The CNG dual fuel system added $12,000-15,000 to the price of the plane. Generally, CNG sells for about 80% less than aviation gasoline, which is averaging about $6.00/gallon.
U.S. District Judge Carl Barbier in New Orleans has ordered BP plc to ante up more than $130 million in fees to continue funding the court-supervised claims administrator for the Macondo blowout compensation fund. BP Group CEO Bob Dudley said in July the $20 billion fund soon would soon be depleted in part because an investigation underway indicates that some of the spill funds have been mismanaged (see NGI, Aug. 5). Barbier, who affirmed a lower court ruling, said claims administratorPatrick Juneau needs to submit budget proposals 60 days before the start of a new quarter beginning with claims for 1Q2014. BP also would be given time to review the budget.
Halliburton Co., Schlumberger Ltd. and Baker Hughes Inc. are facing a class action antitrust lawsuit over alleged price manipulation, filed two weeks after the U.S. Department of Justice(DOJ) launched an investigation in price manipulation. In July Baker and Halliburton indicated in filings that they had received civil investigation demands (CID) to provide documents and information on their pressure pumping businesses (see NGI, July 29). Schlumberger, headquartered in Paris, has not indicated if it also received a CID. In turn, Texas-based Cherry Canyon Resources LP has sued the trio for antitrust violations in U.S. District Court for the Southern District of Texas (Cherry Canyon Resources LP v Halliburton Co. et al, No. 2:13-cv-00238).