Two multi-state organizations, with the help of oil and gas companies, are preparing to launch a website Monday (April 11) that will provide the public with a comprehensive list of chemicals used in hydraulic fracturing. The website, fracfocus.org, is being developed by the Ground Water Protection Council (GWPC) and the Interstate Oil and Gas Compact Commission. “This is pretty unique,” GWPC spokesman Mike Nickolaus told NGI. “Some of the oil and gas companies have done some of this on their own in the past, and the service companies have something too, but it’s not at all like this. This will be the only multi-state, multi-operator registry of this sort.” Once the website is online, the public would be able to search for wells by state, county or their American Petroleum Institute number. Twenty companies, both producers and service companies, already have registered and agreed to voluntarily upload data about their operations.

House Republicans have once again introduced legislation that would open the federal waters offshore Virginia to natural gas and crude oil exploration. The bill calls for the Interior Department to proceed with a Virginia offshore lease sale — the first lease sale conducted off the East Coast in 30 years — no later than one year after the passage of the bill. Republican congressmen and Virginia state lawmakers have pushed for years to allow exploration and production in the Outer Continental Shelf (OCS) off the Virginia coast, but have been blocked in their efforts by either Interior or the state’s governor, or both (see NGI, March 29, 2010). The current governor, Bob McDonnell, has signaled that he is more receptive to exploration and production off the East Coast (see NGI, March 15, 2010). Interior has estimated that Virginia’s OCS has 130 million bbl of recoverable oil and 1.14 Tcf of recoverable natural gas, said Rep. Bob Goodlatte (R-VA), the chief sponsor of the measure. The legislation, the “Virginia Access to Energy Act,” authorizes that all revenue generated from extraction of the resources in Virginia’s OCS may be shared evenly with the state and federal governments.

House Democrats last Tuesday introduced legislation that seeks to correct an omission in offshore oil and natural gas leases issued by the Interior Department in 1998-1999 that reportedly is costing the federal government billions of dollars. The bill would fix the flaw that has allowed dozens of companies to produce oil and gas in the Gulf of Mexico without paying royalties to the federal government. The measure has a slim chance of passing Congress, given that past efforts by Democrats have failed (see NGI, Sept. 18, 2006). Republicans have tended to side with producers, who have argued that any attempt to renegotiate or revoke the leases would violate contract sanctity and would set a bad precedent. The Minerals Management Service, the predecessor to the Bureau of Ocean Energy Management, Regulation and Enforcement, failed to include in the 1998-1999 leases oil and gas price ceilings, which when exceeded would make production from the leases royalty-bearing. The Government Accountability Office has estimated that the faulty leases could cost the federal government up to $53-54 billion over the next couple of decades (see NGI, June 9, 2008). The Democratic authors of the bill are Reps. Edward Markey of Massachusetts, Rush Holt of New Jersey, George Miller of California, Jim Moran of Virginia, Maurice Hinchey of New York and Lois Capps of California.

The Colorado Petroleum Association (CPA) is changing its strategy to seek permission for operators to bury plastic liners used in wastewater pits at drilling sites. CPA President Stan Dempsey told NGI that the nonprofit organization was working with the Colorado Oil and Gas Conservation Commission (COGCC), the Colorado Department of Public Health and Environment and local governments to develop a workaround allowing on-site liner disposals to resume. The CPA withdrew a petition requesting COGCC amend Rule 905, which required operators to dispose of liners in landfills. “Our path forward is to develop a different regulatory alternative and deal with this through the solid waste laws,” Dempsey said. “It’s a promising idea, but the details haven’t been hammered out yet.” The organization hopes to forge a certificate of designation plan with state, county and local governments — especially Rio Blanco County — that would allow some operators to bury liners on-site with exploration and production waste, something they were permitted to do before COGCC overhauled state regulations in 2009 (see NGI, March 30, 2009).

Westlake Chemical Corp. said that it will grow its ethane-based ethylene capacity by expanding a plant in Louisiana and possibly converting a second plant in Kentucky to ethane feedstock, part of the company’s plans to capitalize on new sources of cheap ethane and other light feedstocks. The Houston-based company said it would expand each of the two light feedstock ethylene crackers at its facility in Lake Charles, LA, which currently has a total capacity of 2.5 billion pounds per year. Construction would begin during planned maintenance turnarounds in order to continue providing ethylene to customers and existing internal derivatives units. The first cracker expansion will increase total capacity by 230-240 million pounds per year, more than 10%, and be completed by late 2012. The second cracker will be expanded by the end of 2014. Westlake said it also plans to evaluate converting its plant in Calvert City, KY, from propane to ethane feedstock, citing the increasing availability of liquefied natural gas (LNG) from sources such as shale gas. The company said it was also looking at plans to expand the Calvert City facility.

Texas businesses that convert heavy-duty vehicles to run on natural gas or buy new natural gas vehicles (NGV) could get financial incentives from the state for doing so under legislation passed by the Texas Senate. The same bill (SB 20) would also create a network of fueling stations to support such vehicles. Funds from the Texas Emissions Reduction Program would pay for companies to either buy new NGVs or convert existing vehicles to run on natural gas. There is nearly $42 million available for the program. The fueling station network would be known as the Texas Clean Transportation Triangle and would entail corridors with NGV refueling capability running among Houston, San Antonio, Dallas and Fort Worth. The legislation now goes to the Texas House.

The Chesapeake Bay Foundation (CBF) is urging President Obama to authorize a comprehensive study of hydraulic fracturing (hydrofracking) in the Marcellus Shale and its potential effects on the Chesapeake Bay watershed. In a letter, the CBF asked the president to direct the Council on Environmental Quality to conduct a programmatic environmental impact statement (PEIS) over the risks and cumulative impacts of hydrofracking in the Marcellus, and to make any appropriate decisions on new regulations. CBF spokesman John Surrick told NGI that the environmental organization filed a legal petition to have the PEIS performed under the auspices of the National Environmental Policy Act.

Constellation Energy, parent of Baltimore Gas and Electric Co., last Monday said it had reached an agreement with Toyota Motor Engineering & Manufacturing, North America Inc. to provide an array of integrated natural gas services and energy market analyses to Toyota facilities in the United States, Canada and Mexico. The range of energy services to be offered by Constellation to Toyota will include natural gas supply; risk management; hedging and budget analysis; energy market monitoring; utility rate, invoice and pipeline transportation reporting; and monitoring of relevant regulatory and legislative issues. When asked how much natural gas would be supplied to Toyota under the agreement, a Constellation Energy spokeswoman said, “We don’t share that information.” Effective April 1, Constellation Energy said it began offering risk management services to 14 Toyota facilities and gas supply to nine Toyota sites in North America.

Technology exists to curtail natural gas flaring, but it will take a concerted effort worldwide to capture the lost gas, an energy arm of General Electric Co. (GE) said in a report. Associated natural gas is found in oil deposits, but most of the gas is burned off during oil production. According to GE Energy, the gas lost through flaring is “roughly equivalent” to gas use in all U.S. residences for a year. By its figures, the flared gas also represents 5% of global gas production; 23% of U.S. gas use; 38% of European Union gas use; $10 billion in lost revenue at $2.00/MMBtu; and 2.4 million boe/d. The report is available from GE Energy.

Sempra Pipelines & Storage, a unit of San Diego-based Sempra Energy has completed an $875 million acquisition that give it a 100% interest in a Chilean energy company and a 76% interest in a Peruvian utility. Sempra, which has had a shared interest in utilities in Chile and Peru for 12 years, now owns Houston-based AEI’s shares in both South American companies — a 50% interest in Chilquinta Energia SA in Chile and about 38% of Luz del Sur in Peru that was held by the Texas firm.

In the midst of a global climate change strategy among policymakers, the demand for fossil fuels is surging, which in turn is impacting the deployment of clean energy technologies, according to an International Energy Agency (IEA) report. The IEA concluded that there are three options for fossil fuels, particularly coal: more efficient generation, switching to natural gas-fired generation, and stepping up development of carbon capture and storage (CCS) projects. For copies of the report e-mail IEAPressOffice@iea.org.

Pennsylvania Lt. Gov. Jim Cawley (R) said four working groups created by the Marcellus Shale Advisory Commission will meet beginning on Monday (April 11). All of the meetings are open to the public and are scheduled to start at 10 a.m. EDT in Room 105 of the Rachel Carson Building in Harrisburg, the state capital. The Marcellus Shale Advisory Commission, which has 30 members, was formed in March by Gov. Tom Corbett. The full committee memberships and meeting agendas will be posted online on the Marcellus Shale Advisory Commission page of the Pennsylvania Department of Environmental Protection website.

Mexico’s state-owned petroleum company, Petroleos Mexicanos (Pemex), said it has discovered oil at a test well, which initially is producing more than 3,700 b/d of crude oil and 8 MMcf/d of natural gas. The Pareto-1 test well — located in the southeastern state of Tabasco and about 10 kilometers (6.2 miles) from the city of Comalcalco — was drilled to a depth of 7,124 meters (23,372 feet). The company said hydrocarbons were discovered between 6,100 and 7,130 meters (20,000 and 23,392 feet). The well is in the Comalcalco formation, one of several basins in the southeast part of the country. Pemex has produced an average of about 2.57 million b/d of crude oil per month this year, including 847,000 b/d of light crude. Natural gas production is currently averaging 6.862 Bcf/d per month in 2011, which is below the 2010 monthly average of 7.020 Bcf/d.

The Pennsylvania Department of Environmental Protection (DEP) is blaming a local gas driller for contaminating private water supplies. The DEP ordered Catalyst Energy Inc. to stop all drilling and hydraulic fracturing operations at 36 non-Marcellus Shale wells located in Forest County. The DEP said an investigation found natural gas from Catalyst operations, as well as elevated levels of iron and manganese, in the water supplies serving two homes located near the drilling site. Catalyst declined to comment about the order. The case is one of the first since new well construction standards for Pennsylvania went into effect in February.

The Bartonville, TX, Town Council on March 30 instituted a 90-day moratorium on new permits related to natural gas drilling and production. The ordinance stipulates that no applications will be accepted for drilling, hydraulic fracturing or other introduction of chemicals into the ground. However, Ordinance 515-11 does allow the council to grant waivers. Bartonville is in Denton County in the heart of the Barnett Shale region. The town’s population is about 1,600.

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