Confusion

The administration’s multi-agency approach to hydraulic fracturing (fracking) studies and the appearance of mission-creep is causing confusion within the oil and natural gas industry, according to some critics on Capitol Hill.

The cloud of confusion surrounding the U.S. Geological Survey’s (USGS) recent estimate of undiscovered, technically recoverable natural gas and natural gas liquids (NGL) contained in the Marcellus Shale — and the apparent differences between the USGS assessment and previous estimates — cleared somewhat Friday as the agency clarified its methodology.

The cloud of confusion surrounding the U.S. Geological Survey’s (USGS) recent estimate of undiscovered, technically recoverable natural gas and natural gas liquids (NGL) contained in the Marcellus Shale — and the apparent differences between the USGS assessment and previous estimates — cleared somewhat Friday as the agency clarified its methodology.

The Interior Department’s Bureau of Ocean Energy Management, Regulation and Enforcement (BOEM) last week issued additional guidance to clear up the confusion about the new regulations that were imposed on producers following the Macondo well blowout and sinking of the Deepwater Horizon rig in the Gulf of Mexico (GOM) earlier this year (see NGI, April 26).

Against the backdrop of apparent voter confusion, strong opposition from various state newspaper editorial boards and a thumbs down from all five members of the California Public Utilities Commission (CPUC), Proposition 80, California’s retail electricity reregulation ballot initiative, was rejected by California voters last Tuesday. The rejection was part of a broader avalanche of opposition at the ballot box to a number of initiatives up for consideration this year in the state.

Though somewhat unremarkable in that it featured a 151 Bcf withdrawal that was well within market expectations (see related story), the weekly storage report released Thursday by the Energy Information Administration (EIA) drew attention from industry analysts and data crunchers alike because it was a calendar anomaly — it was the 53rd weekly storage report for 2004.

Though somewhat unremarkable in that it featured a 151 Bcf withdrawal that was within market expectations, the weekly storage report released last Thursday by the Energy Information Administration (EIA) drew attention from industry analysts and data crunchers alike because it was a calendar anomaly — it was the 53rd weekly storage report for 2004.

After closing down 16.8 cents at $5.765 on Thursday, the natural gas futures May contract went for a run Friday morning, notching a high of $5.920 in morning trading, before settling down to close at $5.812, up 4.7 cents on the day.

A team of El Paso Natural Gas executives last week tried toclear away any confusion that their transportation customers mayhave had with the pipeline’s new capacity-allocation proposal, buttheir efforts appeared to have fallen short as some shippers leftthe FERC technical conference more bewildered than when they wentin.