Alaska Native and conservation groups have successfully challenged the Environmental Protection Agency’s (EPA) issuance of clean air permits to Shell Oil to drill and operate in the Chukchi and Beaufort seas. The Alaska EPA regional office erred when it relied solely on compliance with the national ambient air quality standard for nitrogen oxide “as sufficient to find that the Alaska Native population would not experience disproportionately high and adverse human health or environmental effects from the permitted activity,” said the federal Environmental Appeals Board in its decision. The three groups that challenged the permits were the Center for Biological Diversity; Earthjustice, on behalf of several conservation groups; and the Alaska Eskimo Whaling Commission and Inupiat Community of the Arctic Slope. The permits issued by the EPA authorize Shell Oil, a unit of Royal Dutch Shell plc, to construct and operate the 514-foot Frontier Discoverer drillship and its air emission units and to conduct other air pollutant emitting activities for the purpose of exploration in the Chukchi and Beaufort seas off the North Slope of Alaska. The producer is seeking to drill three exploratory wells in the Arctic seas.

The Balboa Field, which is in the Gulf of Mexico’s deepwater about 130 miles south of Galveston, TX, has ramped up with stabilized gross flow rates of 30 MMcf/d of natural gas and 1,400 b/d of oil, Apache Corp. said. The field, in water depths of 3,350 feet, is located on East Breaks Block 597. An Apache subsidiary operates the field and holds a 50% stake. According to Apache, Balboa is a one-well development with a six-mile tieback to the Anadarko Petroleum Corp.-operated Boomvang spar on East Breaks 643.

Questar Pipeline Co. is holding a binding open season through Feb. 18 for the reconfiguration of compression facilities and piping modifications at its Fidlar Compressor Station as well as an increase in the maximum allowed operating pressure of a section of its Mainline 68. Proposed modifications would enable Questar to offer firm service to deliver up to 25,000 Dth/d to the White River Hub from receipt points at Fidlar or upstream of Fidlar. Additionally, Questar would be able to provide firm service to deliver up to 30,000 Dth/d from the White River Hub to various points on its Northern system utilizing this capacity along with currently unsubscribed capacity. Questar said the new facilities could be in service by November.

A federal judge in Kansas has issued an injunction ordering that some natural gas wells be shut in as they are alleged to be producing from a storage field owned by Northern Natural Gas Co. “Northern claims that injected storage gas has migrated out of its Cunningham Storage Field and has been produced by certain wells operated by L.D. Drilling Inc., Val Energy Inc. and Nash Oil & Gas Inc.,” said the injunction from U.S. District Court Judge Wesley Brown. “All of these wells are located in the ‘Expansion Area’ certified by the Federal Energy Regulatory Commission (FERC) for inclusion in the Cunningham Storage Field, and all are located on tracts named as defendants in the current condemnation complaint.” Northern had asked that the wells in question be shut in while its claim of storage gas migration is resolved. The company is required to post security of $2 million. If Northern posts the required security, then by Feb. 21 the producers will be required to stop production from 25 wells targeting the Viola and/or Simpson formations. Last July Northern sued for the condemnation of 9,100 acres in south-central Kansas to enable the expansion of its Cunningham field (see NGI, July 26, 2010). A month earlier FERC had issued Northern a certificate of public convenience and necessity that authorized “expansion of Northern’s certificated buffer zone to include the Viola and Simpson formations” (see NGI, June 7, 2010).

Gasco Energy Inc. has agreed to pay $350,000 and provide for air pollution controls at its facilities in the Uinta Basin to settle allegations that it violated the Clean Air Act (CAA) at a compressor station in Utah, the Environmental Protection Agency (EPA) said. The company disclosed the violations voluntarily. Gasco is the former operator of the Riverbend Compressor Station on the Uintah and Ouray Indian Reservation near Vernal, UT, where it is alleged to have violated the CAA.

W&T Offshore Inc. said its 2011 capital budget is $310 million and will be funded entirely from cash flow. The budget contains capital to drill 14 wells, including 10 exploration and four development wells. Of the 14 wells, five are on the conventional shelf, one is in the deepwater, two target the deep shelf of the Gulf of Mexico, and six wells are located onshore.The planned spending excludes a pending acquisition of the Gulf of Mexico producing shelf property from Shell Offshore Inc. (see NGI, Nov. 8, 2010), as well as other potential acquisitions. “Our capital budget for 2011 offers a balance of onshore, offshore, high-potential exploration and low-risk exploitation/development activity with an emphasis on oil projects,” said CEO Tracy W. Krohn.

The Nevada Public Utilities Commission (PUC) approved rate changes effective Jan. 1 for NV Energy Inc.‘s northern utility operations. As a result, retail natural gas utility rates increased at the start of the new year and electric rates decreased. The overall revenue increase to the company is $2.7 million for natural gas and, thanks to other fixed monthly customer charges, $13.1 million for electric. For the typical residential customer using 54 therms of natural gas/month, state regulators approved an increase of approximately 1.6%, or 88 cents/month, from $56.72 to $57.60. The end-of-year 2010 rate changes are a result of the company’s mandatory gas and electric general rate case filings made every three years. In just two years, NV Energy’s electric prices have fallen 19% and natural gas prices have decreased by 20%.

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