Constellation Energy, a unit of Chicago-based Exelon Corp., has inked a contract with Proctor & Gamble Co. (P&G) to develop a $200 million, 50 MW biomass cogeneration plant to replace an older, smaller cogen facility at the company's Albany, GA, paper manufacturing facility. The energy facility would provide all of the steam and 60-70% of the paper plant's energy needs. It plans to sell 42 MW of excess electricity to the local power utility Georgia Power Co. Constellation would build, own and operate the cogeneraion plant. For more than 30 years the P&G plant in Albany has used a smaller onsite biomass boiler to convert wood scraps into renewable steam, providing about 30% of the plant's overall energy needs.
Pennsylvania Democratic Gov. Tom Wolf released a few more details regarding his plans to tax natural gas production in the state at a flat rate of 5% in addition to a 4.7 cent/Mcf volumetric fee (see Shale Daily, Feb. 11). Wolf's administration said his proposal includes exemptions for gas given away for free; gas from low-producing wells and wells brought back into production after not having produced marketable quantities of gas. Wolf also said his proposal would contain provisions to protect leaseholders from companies looking to pass through additional costs from the tax if it is passed. Wolf did not provide specifics, but he has said the tax structure would be similar to West Virginia's model. That state makes exemptions for gas wells producing less than 5 Mcf/d and oil wells producing less than 0.5 b/d.
San Antonio-based Tesoro Corp., a major player in the Bakken and other shale plays through its midstream unit, Tesoro Logistics LLP (TLLP), said it will pursue nearly $400 million in two projects at its Anacortes, WA, refinery. One project could enhance future exports of refinery products to Asian markets. The projects are spurred by more stringent gasoline fuel content requirements and by a growing global market for xylene, a major petrochemical that makes up a small fraction of crude oil. Some observers see the projects as bolstering markets for light sweet crude, particularly from the Bakken, but a Tesoro spokesperson told NGI's Shale Daily that they are both being pursued "independent of any specific crude [supply] state."
West Virginia lawmakers are once again trying to pass legislation that would allow exploration and production companies drilling the Marcellus Shale and other shallower formations in the state to pool landowners into units. For years now, similar measures have failed over concerns about property rights (see Shale Daily, April 17, 2013; Feb. 1, 2011). But the latest attempt, HB 2688, has passed the House of Delegates Energy Committee and moved to the House Judiciary Committee. Since the 1990s, forced pooling has been allowed in West Virginia for deep wells below the Marcellus, such as the Utica Shale, as well as shallow secondary oil recovery and coalbed methane wells. Under current law, though, the state does not allow pooling for wells targeting other shallow formations such as the Marcellus.
BP plc's request to cap Macondo oil spill liabilities below the maximum sought by federal prosecutors was rejected Thursday by a Louisiana court. U.S. District Judge Carl Barbier of the Eastern District of Louisiana, who is overseeing the multi-district litigation, has not determined the actual amount of civil penalties to be levied against BP under U.S. Clean Water Act (CWA) penalties. However, the judge sided with federal prosecutors, who have argued for a maximum penalty of $4,300/bbl, per U.S. Environmental Protection Agency (EPA) authority (see Daily GPI, Jan. 21). BP had sought a cap of $3,000/bbl, the cap set by Congress in 1990. However, Congress also gave EPA authority to adjust penalties for inflation, Barbier noted. EPA's authority is within "the very first section" of the CWA, he wrote. At the time of the Macondo blowout, EPA's maximum civil penalty for oil spills was $4,300/bbl, while the U.S. Coast Guard's was set at $4,000/bbl.