Tag Archives: Oil and gas

Fracking Companies Look to Drain Williston Reservoir for Water Needs

Energy and Resources, Fracking, Oil&Gas, WATER, Water and Hydrocarbons, ,
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From the Alaska Highway News (Fort St. John) – June 8, 2011

by Ryan Lux

Applications have been submitted by two
energy companies to the Ministry of Forests, Land and Natural Resource
Operations, to pipe water out of the Williston Reservoir for use in
fraccing operations on the Montney shale gas play.


According to the OGC, Talisman Energy
and Canbriam are both seeking to withdraw 10,000 cubic metres of water
per day – 7,300,000 cubic meters per year in total – to provide water to
their various drilling sites through a network of pipelines.


Up to this point, both energy companies
have been depending on short-term water use permits, which allow
industry to draw water from surface sources and shallow wells. One
surface source, which has generated tension, is the Lynx Creek boat
launch where Talisman has been withdrawing 4,000 cubic meters per day.


The tension created by trucking water
out of the popular recreation spot will be eliminated, according to
Talisman spokesperson, Phoebe Buckland, if the company receives approval
to pipe the water from the Williston Reservoir.


“We’ve been using temporary permits
over the last couple of years through the OGC and now we’ve applied for
two permanent licenses for the Williston Reservoir, one to withdraw the
water and the other to construct a pipeline,” said Buckland.


“After reviewing our options we feel
that the this is the best solution, as the Williston Reservoir provides a
reliable source of water and the pipeline would reduce tanker traffic –
reducing the impact on residents and our greenhouse gas emissions at
the same time.”


If approved, the water would come from
the reservoir south of Hudson’s Hope and run to Talisman’s Beryl Prairie
Road facility, where it would be stored in pits and tanks until used
for fraccing operations.


Talisman plans to withdraw 3.6 million
cubic meters a year, a figure which Talisman claims represents only 0.01
per cent of the average yearly flow through the W.A.C. Bennett Dam.


Despite the fact that their proposed
water withdrawal only represents a fraction of the river’s flow,
Buckland explained her company plans to recycle almost all of the water
they use.


“Water management is something we take
very seriously and we are aware that fraccing requires large volumes of
water,” acknowledged Buckland, “We’re recycling close to 100 per cent of
the water to be used in future fracs.”


Buckland explained that following a frac, the water returns to the surface where Talisman captures it for re-use.


Even with assurances of solid water management, critics have raised concerns about Talisman’s proposal.


Sustained drought has placed a strain
on water levels in Williston Reservoir, which was four metres below
average in September 2010, a situation that forced BC Hydro to import
$200 million of electricity last year.


Ben Parfitt, of the Canadian Centre for
Policy Alternatives, explained what concerns him about the permanent
water licensing proposals is the prospect of locking public water
supplies into private companies for what could be decades.


Chief Roland Willson expressed concerns
over the consultation process: “As far as I’m concerned, the Oil and
Gas Commission should not be leading any consultation on water rights or
allocations in our territory,” Willson said. “That’s a job for
provincial water regulators. The other thing that really concerns me is
that when they finally send us information they neglect to mention that
Talisman is not alone in seeking to divert massive amounts of water out
of Williston Reservoir.


“In fact, there is at least one other
major water diversion proposal that has been filed with the provincial
government. If they want to present us with the ‘bigger picture’ they
need to give us all the information, not half of it.”


BC Hydro didn’t return calls by press
time to discuss whether or not the Crown Corporation would receive
compensation for the diverted water, which otherwise would be used to
produce electricity. At present, energy companies don’t pay for the
water they draw from surface sources and shallow wells.


Buckland said Talisman is confident
their proposal will meet provincial requirements and that the process
has engaged the public through consultation and awareness campaigns. To
date, Buckland couldn’t recall any water applications submitted by
Talisman that haven’t been approved.


Construction on the pipeline could
proceed as soon as this summer and be completed within several months,
pending regulatory approval.

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New York Times: Oil Sands Project in Canada Will Go On if Pipeline Is Blocked

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From the New York Times June 7, 2011

by Ian Austen

OTTAWA — One way or another — by rail or ship or a network of pipelines — Canada will export oil from its vast northern oil sands projects to the United States and other markets.

So the regulatory battle over the proposed Keystone XL pipeline, which
would link the oil sands to the Gulf Coast of the United States, may be
little more than a symbolic clash of ideology, industry experts say.
Even if the Obama administration rejects the Keystone plan, the pace of
oil sands development in northern Alberta is unlikely to slow.

Oil producers in Canada have several alternatives for reaching the
United States market. And recent investments by Chinese companies in the
oil sands suggest that a growing alternative market lies across the
Pacific.

“The Canadian oil sands will continue to be developed irrespective of
whether the pipeline goes ahead,” said Russell K. Girling, the president
and chief executive of TransCanada, the company behind the $7 billion project.

That determination to proceed has become almost beside the point in the
battle over Keystone XL’s fate, which has dragged on since November
2008.

Environmentalists are using the project as a proxy for their general
antagonism toward oil sands production, which consumes large amounts of
water and energy and can be destructive to the boreal forest that sits
on top of the tarry rock from which the oil is extracted.

“This is really a campaign against tar sands expansion rather than a
single pipeline,” said Susan Casey-Lefkowitz, the director of the
international program at the Natural Resources Defense Council, an
environmental group that is a leading American critic of the process.

Advocates, meanwhile, say that oil sands extraction is getting cleaner
and represents a potentially major source of oil from a politically
stable ally that will help ensure America’s energy security.

The stakes are enormous. The oils sands have reserves of 171.3 billion barrels, according to estimates
by the provincial government of Alberta — enough to change the balance
of world oil markets, some energy experts say; by comparison, Saudi
Arabia has reserves of 264.2 billion barrels.

Because of that, the debate over the pipeline has been unusually
protracted and fractious, and, according to some analysts, characterized
by hyperbole on both sides.

“This situation has reached such talismanic significance that whatever
the U.S. government does will be read far more deeply than the substance
merits,” said Michael A. Levi, the senior fellow for energy and the
environment at the Council on Foreign Relations.

The State Department, which must approve the project because it crosses
international borders, is nearing the end of its environmental review
and then will examine national interest questions. It has said it
expects to make a ruling by the end of the year.

As the world’s largest importer of oil and a next-door neighbor of
Canada, the United States is the most attractive and logical market for
oil sands crude and already buys virtually all that Canada exports. But
producers are eager to move their product all the way to the Gulf of
Mexico, where there are more refineries capable of handling the
unusually thick crude.

It is now shipped through an existing pipeline — an earlier part of the
Keystone project — to Cushing, Okla., where large storage facilities are
fed by a variety of pipelines. There, it is priced against lighter oil
and generally commands a lower price.

Because demand for oil in the United States is unlikely to fall
significantly in the foreseeable future, Canadian producers are sure to
look for other ways to ship their oil south if the Keystone XL project
is rejected. While backup plans are not fully developed, other options
do exist.

Shipping by rail is one. Last October, in a joint venture with the
Canadian National Railway of Montreal, Altex Energy, an oil shipping
company, began shipping relatively small amounts of tar sands crude
along Canadian National’s tracks directly to the Gulf of Mexico.

Not only does rail avoid billions of dollars in infrastructure
investment, it also escapes any regulatory reviews in the United States.

“It’s no different than shipping grain,” said Glen Perry, the president of Altex, which is based in Calgary, Alberta.

Mr. Perry acknowledged that rail was considerably more expensive than
pipeline shipping. Pipelines, however, require the oil sands crude to be
diluted with chemicals that thin it and make it flow more easily. Rail
cars do not.

In addition to rail, there are other pipelines available. The Trans
Mountain pipeline owned by Kinder Morgan already moves Alberta oil,
including tar sands production, to ports on Canada’s Pacific Coast. Some
of that travels by sea to refineries in the United States.

While that pipeline is operating at near capacity, Kinder Morgan is considering increasing its capacity to the coast and has already upgraded the line inland.

Enbridge, another large Canadian pipeline company, is proposing its own
line, from just north of Edmonton, Alberta, to the northern British
Columbia port of Kitimat.

While both of those projects have encountered opposition from
environmentalists and some aboriginal groups, the political climate
favors the energy industry. Last month Canadians re-elected a
Conservative government that has its traditional power base in Alberta,
which has staunchly promoted the oil sands.

Other pipeline projects could develop if Keystone XL does not. It is technically feasible to convert one of two natural gas
pipelines to eastern Canada to carry oil. Once there, shipments could
enter the United States through existing trans-border crossings in
Ontario and Quebec.

Ronald Liepert, the energy minister in Alberta, said that while Canada
would prefer to sell its oil to the United States, “this commodity will
go someplace.”

In particular, he said, China is already a major consumer of other
Canadian natural resources and a small investor in the oil sands. “I can
predict confidently that at some point China will take every drop of
oil Canada can produce.”

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Enbridge oil spill in NWT could top 1,500 barrels

Energy and Resources, Oil&Gas, Tar Sands,
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From the Calagary Herald – May 6, 2011

by Dina O’Meara

CALGARY — An oil leak in a remote area of the
Northwest Territories could reach up to 1,500 barrels — substantially
more than the four barrels originally reported by pipeline operator
Enbridge Inc.

The Calgary-based pipeline
operator said Monday its original estimate was based on oil found on
land at the leak site, located about 50 kilometres south of Wrigley,
NWT, and didn’t take into account seeping into the soil.

“Based
on current estimates provided by the third party experts on site,
Enbridge anticipates the release volume could range from a minimum of
700 barrels to a maximum of 1,500 barrels,” said spokeswoman Gina
Jordan, in an e-mail late Monday. “Based on its current analysis,
Enbridge anticipates the probability that the maximum volume would be
exceeded to be low.”

The company has removed about 100 barrels of oil from the site, she said.

Enbridge
last year faced an environmental and public relations nightmare after
its Line 6b ruptured in late July, spewing almost 20,000 barrels of oil
into Michigan waterways.

Jordan said the NWT leak was contained along the pipeline right of way and no watercourses were threatened.

The
Norman Wells to Zama, Alberta line was restarted May 20th, but is not
at full operations due an outage on the Zama to Hardisty, AB Rainbow
line, operated by Plains Midstream Canada.

Rainbow
was shut down in late April after a leak was detected on the system
near the community of Little Buffalo in northwest Alberta. The 28,000
barrel spill was the largest in Alberta for decades.

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U.S. order keeps Keystone pipeline shut down

Energy and Resources, Oil&Gas, Tar Sands,
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From the Montreal Gazette – June 3, 2011

by Sheldon Alberts

WASHINGTON — The Obama administration issued an order Friday
preventing Calgary-based TransCanada Corp. from restarting its massive
Keystone oil pipeline after an investigation into two spills in less
than a month found “serious” concerns about safety in pump stations
along the 3,450-kilometre line.

“After evaluating the
foregoing preliminary findings of fact, I find that the continued
operation of the pipeline without corrective action would be hazardous
to life, property and the environment,” Jeffrey Wiese, the associate
pipeline safety administrator with the U.S. Department of
Transportation, wrote in a letter to TransCanada executives.

The
order to keep the 600,000-barrel-per-day pipeline shut down comes after
investigations into separate spills at Keystone pumping stations in
North Dakota and Kansas determined “cyclical fatigue” contributed to the
failure on pipe fittings at both facilities. It requires TransCanada
meet 14 conditions before the pipeline can resume operations.

The
problems along the existing Keystone pipeline come at a critical time
for TransCanada, which is seeking a presidential permit approving the
construction of a second major pipeline, the Keystone XL, across the
U.S. Great Plains to the Gulf Coast in Texas.

The U.S.
State Department is completing public consultations on Monday into an
environmental impact study of the proposed Keystone XL Line.

Environmental
groups and landowners along the planned route of the new pipeline fear a
major spill could cause irreparable damage to sensitive ecosystems like
the Sand Hills in Nebraska. There are also concerns, particularly in
Nebraska, about environmental threats to the Ogallala Aquifer, a major
groundwater source for residents in the Great Plains states. Keystone XL
would cross the aquifer.

“We recognize that these
instances would lead to negative public perception about our pipelines,”
TransCanada spokesman Terry Cunha said Friday afternoon. “But we take
these things very seriously and we are taking the necessary steps to be
done to ensure the integrity of the system.”

The original
Keystone pipeline — which began delivery of oilsands crude from
Hardisty, Alberta, in June 2010 — has so far had 11 breaks along the
2,100-kilometre U.S. portion of the line.

The pipeline was
shut down May 7 after about 400 barrels of oil spilled at the Ludden
pump station in Sargent County, North Dakota. The pipeline was restarted
on May 13.

TransCanada was forced to shut down the
pipeline again following the failure of another fitting at the Severance
pump station in Doniphan County, Kansas.

About 10 barrels
of oil were spilled in Kansas, and TransCanada officials said this week
they hoped to restart the pipeline again within days.

The
Department of Transportation order revealed a third, previously
unreported leak, on May 25 at the Roswell pumping station in South
Dakota. That spill was not big enough “to meet reportable criteria,” but
it was also caused by cyclical fatigue on a transmitter fitting.

“I’m
concerned about the environmental risk. There have been 11 spills in
TransCanada pipelines in the last year, I believe. That seems to me to
be a rather high number,” said Bill Avery, a Nebraska state senator who
opposes the construction of the new Keystone XL.

“The
spills validate some of the concerns that a number of us have had all
along. Maybe TransCanada is not leveling with the public . . . about the
safety of its pipeline.”

The corrective ordered issued on
Friday “prevents TransCanada from restarting operations on their
Keystone crude oil pipeline until (the Pipeline and Hazardous Materials
Safety Administration) is satisfied with the ongoing repairs and is
confident that all immediate safety concerns have been addressed,” Julia
Valentine, a Department of Transportation spokeswoman, said in an
emailed statement.

“In addition to immediate repairs and
testing, PHMSA’s order requires TransCanada to perform metallurgical
testing and root cause failure analysis, review other parts of the
pipeline system for concerns similar to those involved in the recent
failures, make permanent repairs and continue ongoing monitoring.”

The
North Dakota spill in early May was sourced to a small “swaged nipple”
on piping that had cracked “as a result of over-torque during
installation,” the Department of Transportation said.

TransCanada
determined “the cyclic bending stress fatigue due to normal operational
vibration propagated the cracks to failure,” according to the
corrective action order.

The Keystone break in Kansas on May 29 was on a half-inch diameter nipple that also indicated “cyclical fatigue.”

In
the corrective action order, Wiese writes that there is “potential for
the conditions causing the failures to be present elsewhere on the
pipeline.”

TransCanada must now send the U.S. government a
detailed “re-start plan” including information about repairs, evidence
of proper pump station monitoring and communication with local emergency
officials along the route.

“I don’t have a timeline as to
when the start-up will be taking place,” said Cunha. “But we are
implementing all the 14 conditions outlined, and hope to have them
implemented right away so that way we could have the system up and
running as soon as possible.”

The pipeline has, as of
Friday, been shut down for six consecutive days. TransCanada remains
hopeful Keystone can “deliver all of our obligations for the month of
June,” Cunha said.

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U.K. Company Suspends Fracking Operations after Possibly Triggering Earthquakes

Energy and Resources, Fracking, Oil&Gas, Water and Hydrocarbons,
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From The New York Times – June 6, 2011

by David Jolly

PARIS — A British company said Wednesday that it would temporarily halt
the use of a controversial gas exploration technology after indications
that it might have set off two small earthquakes near a test well in
Lancashire, England.

The company, Cuadrilla Resources,
which is exploring for gas in shale formations deep underground, said
it would postpone hydraulic fracturing, or fracking, operations at the
Preese Hall site near Weeton.

“We take our responsibilities very seriously,” Mark Miller, the chief
executive of Cuadrilla, said in a statement, “and that is why we have
stopped fracking operations, to share information and consult with the
relevant authorities and other experts.”

Fracking is a procedure in which water, chemicals and sand are injected deep underground to free oil or gas trapped in dense shale formations.

The technology is widely used in the United States, where it has contributed to a boom in natural gas
production. It has been criticized because the fracking chemicals are
believed to have the potential to contaminate groundwater.

“We have discussed this with Cuadrilla and agreed that a pause in
operations is appropriate so that a better understanding can be gained
of the cause of the seismic events,” the British Department of Energy and Climate Change said in a statement.

Experts from the British Geological Survey, the government and Keele University are examining the data, “and we will need to consider the findings into the cause of the event,” the department said.

The halt was called after the British Geological Survey recorded an earthquake early on May 27 at a depth of about 1.25 miles, with a magnitude of 1.5.

“Any process that injects pressurized water into rocks at depth will
cause the rock to fracture and possibly produce earthquakes,” the survey
said on its Web site.

Brian Baptie, the top seismology official for the organization, said in a
statement that measuring instruments had been installed close to the
drill site after a magnitude 2.3 earthquake occurred on April 1.

“The recorded waveforms are very similar to those from the magnitude 2.3
event,” Mr. Baptie said, “which suggests that the two events share a
similar location and mechanism.”

The two quakes were barely perceptible to humans.

Industry officials say Europe is a decade or more behind the United
States in its effort to recover “unconventional” hydrocarbons like the
oil and gas in shale. Governments and energy companies have viewed
technologies like fracking as a means to reduce European Union
dependence on imported oil and gas, but there can be no certainty that
exploitable deposits exist without further testing.

Cuadrilla’s announcement came as the French Senate on Wednesday began a debate on a proposed fracking ban.

The lower house of Parliament on May 11 passed its own bill,
which would prohibit fracking in the exploration and recovery of oil
and gas, and would revoke existing exploration contracts that relied on
the procedure. The Senate, though, is considering a measure that would
leave open the door to fracking for research.

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About Fracking Time for an Investigation

Energy and Resources, Fracking, Oil&Gas,
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From TheTyee.ca – June 1, 2011

by Ben Parfitt

As British Columbia Premier Christy Clark makes her debut in the provincial legislature this week, the media spotlight will likely be on the predictable verbal sparring between her and Adrian Dix, the NDP’s recently minted leader, over the Harmonized Sales Tax.

Meaning that Independent MLAs Bob Simpson and Vicki Huntington will have their work cut out for them trying to maintain media focus and public attention on their welcome non-partisan call for the appointment of a special legislative committee to thoroughly investigate unconventional natural gas developments in the province.

It’s a call that 21 organizations and prominent British Columbians — including First Nations, leading environmental organizations, local citizens groups in the natural gas-rich northeast corner of the province, and individual town councilors — all support, and one that we at the B.C. Office of the Canadian Centre for Policy Alternatives have also endorsed.

For years, the policies of provincial NDP and Liberal administrations alike have been squarely focused on increased exploitation of B.C.’s natural gas resources, which are primarily situated in the Peace River and Northern Rockies regions of the province — an extensive but remote part of B.C. that is larger than the state of Nebraska. This fact may help to explain why it has fallen to Simpson and Huntington to propose that the time has arrived for a sober assessment of the industry’s activities and the role that provincial policies play in shaping them.

It was under the NDP that the one-stop-shop for regulatory energy industry approvals — the Oil and Gas Commission — was created in an effort to eliminate the alleged red tape of multiple agencies reviewing applications by natural gas companies to drill gas wells, build roads and situate pipelines. Dan Miller, under whose tenure as energy and mines minister the OGC was created, would go on to do lobbying work for mining and energy company clients, including Enbridge Inc., the company hoping to build an oil pipeline from Edmonton to Kitimat.

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Kinder Morgan’s Grand Plan to Pipe Oil Sands Crude

Energy and Resources, Oil&Gas, Pipelines and Supertankers,
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From TheTyee.ca – June 2, 2011

by Mitchell Anderson

A quiet application to the National Energy Board (NEB) may soon vastly expand oil tanker traffic through the waters of Burrard Inlet, making Vancouver the major conduit of oils sands crude and bitumen to China.

Trans Mountain Pipeline, a subsidiary of Kinder Morgan that operates the 300,000 barrel per day (bpd) pipeline from Alberta to B.C. and Washington State has applied to the NEB to enter into long-term buying contracts called “firm service.”

They are also requesting to divert more Alberta crude and bitumen capacity to the Westbridge tanker terminal in Burrard Inlet and away from existing land-based refineries in B.C. and Washington. If approved, this would immediately expand crude capacity through Vancouver from 52,000 bpd to 79,000 bpd — an increase of more than 50 per cent.

Documents filed by Kinder Morgan also state that revenues from this new funding model would be used to further expand the pipeline capacity to the Burnaby tanker terminal to 450,000 bpd — a six-fold increase.

Power point reveals aims

A power point presentation for investors by Ian Anderson, president of Kinder Morgan Canada Group, provides a wealth of information that has not been widely shared with the general public or local governments:

• Kinder Morgan plans to dredge Second Narrows channel to allow larger Suezmax tankers that can carry 1 million barrels of crude — four times as much as spilled from the Exxon Valdez.

• These larger vessels will save shippers $1.50 per barrel.

• Tanker transits through Vancouver will increase to 216 per year in 2016, up from 71 in 2010 and 22 in 2005.

• Port Metro Vancouver is “supportive of expansion.”

• “Trans Mountain can be expanded in stages to access growing demand offshore in China.”

All of this is happening with remarkably little scrutiny or even awareness in the Lower Mainland. Of the 18 legal interveners in Kinder Morgan’s application, 17 are oil companies and one is from the Alberta government.

The B.C. government specifically declined to be involved in the decision that would greatly scale up tanker traffic off our coast, through our largest city. No environmental or public interest groups applied to be involved in the NEB application.

‘Rearguard’ pipeline to Kitimat

While there has been enormous interest and opposition to the proposed Enbridge Northern Gateway pipeline, this project is likely years away and must overcome pending legal challenges from several First Nations along the route.

In fact, these obstacles are being trumpeted by Kinder Morgan to their investors. They point out that expanding their existing pipeline to Vancouver is cheaper by $1.5 billion than the proposed Enbridge pipeline, and avoids mounting opposition to constructing a new right of way.

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Gas Pipeline Blazing Trail for Enbridge Gateway Project?

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During an eight-minute interview with Fox News’ Mad Money host Jim Kramer last week, Enbridge CEO Pat Daniel made a revelation that was at once startling and hardly surprising – one with profound ramifications for several of the key environmental challenges facing British Columbia.

Here’s what he said (approx. 6 min mark in the video):

We think we’re in a very strong position with regard to exporting Canadian natural gas in particular. We’re currently putting forward our credentials to the proponents – EOG, Apache, Shell and others – that are working on moving Western Canadian natural gas out to the West Coast; and we would hope to be able to see some synergies with the right-of-way that we’re working on with our Gateway pipeline out to the West Coast. So, yes, we’re very interested in doing that and we would hope to be the the pipeline provider for one or both of those alternatives. (emphasis added)

For the past several months, as I’ve been delving into the business of hydraulic fracturing in Northeast BC, a number things have become clear to me:

1. The proposed Pacific Trail Pipelines line from Summit Lake (just north of Prince George) to Kitimat, referred to as the KSL line, will connect natural gas from Northeast BC to a soon-to-be built Liquid Natural Gas processing facility in Kitimat. Both the pipeline and the plant are partnerships of some of the key players in BC’s natural gas business – notably Apache, EOG and Encana.
2. The Kitimat plant (KLNG) will convert this resource into liquid form, which large tankers will then carry across the Pacific to the ravenous Asian market.
3. Because the Asian market is now paying approximately $10-$12 per 1000 cubic feet (the standard metric for gas sales), while we’re paying in the region of $3.50-$4.00 in North America, you can see why these producers want to access this new market.
4. Transforming natural gas from a continental commodity into a global one will likely intensify pressure to extract increasing amounts of natural gas through unconventional methods like fracking and the equally precarious coal bed methane in BC.

A few more revelations have clicked into place recently, cemented by the above comments from Mr. Daniel. For one, the Kitimat-Summit Lake pipeline bears a very similar proposed right-of-way from Central BC to Kitimat as Enbridge’s Northern Gateway Tar Sands bitumen pipeline plan. And while that project has faced intense opposition from First Nations, conservation groups and citizens across the province, its natural gas counterpart has slid through much of the regulatory review process to the point it’s pretty well a fait accompli. The only remaining hurdle for the gas pipeline and LNG plant to clear is the upcoming National Energy Board hearing on June 7 in Kitimat on the 20-year export license required to sell this gas abroad.

This has got me to thinking of late that the KSL line could very well be used to blaze the trail for the Gateway pipeline. But now we have it straight from the horse’s mouth, Enbridge CEO Pat Daniel – this is, indeed, precisely where things appear headed: “…we would hope to be the the pipeline provider for one or both of those alternatives” – that’s both gas and bitumen. (What the safety logistics of running a potentially explosive gas pipeline in close proximity to a crude line are is an important question to consider).

There may not be much that can be done at this stage with regards to this movement of natural gas from BC to China. PetroChina recently invested $5.4 Billion in Encana, the biggest player in BC’s gas patch (whose former CEO is a key advisor to BC Premier Christy Clark). But to those who oppose the Enbridge crude pipeline, let this be a warning of things to come. It will be critical to stay on top of Enbridge’s movements and ensure that one pipeline doesn’t beget the other.

For detailed information on the nuances of this unconventional natural gas development in BC and North America, check out the following reports:

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Andrew Nikiforuk on New Report: Debunking the ‘Shale Gale’

Energy and Resources, Fracking, Oil&Gas, Water and Hydrocarbons,
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From TheTyee.ca – May 16, 2011

by Andrew Nikiforuk

For several years now, the natural gas industry has
been exclaiming Hallelujahs about the marvels of shale gas with the
passion of a church choir belting out Handel’s “Messiah.”

The hallelujahs, which spring from the U.S.
Energy Information Administration (EIA) or the likes of Chesapeake
Energy (“American’s Champion of Natural Gas”), come in three happy
choruses.

The first says that the shale gas
revolution will miraculously create 100 years worth of methane; the
second chorus maintains that the price of natural gas, a volatile
commodity, will stay low for decades; and the last chorus says that
natural gas will green the economy and arrest climate change.
Hallelujah.

But a new report by J. David Hughes, one of
North America’s foremost coal and gas experts, challenges every single
one of these faith-based assumptions with hard science and clear-eyed
math. In the stunningly lucid 64-page report
for the Post Carbon Institute, Hughes squarely concludes that all three
assumptions are highly questionable, if not total “impossibilities.”

Hughes is no wide-eyed greenie or industry
basher. He happens to be one of Canada’s most credible energy
scientists. The geologist worked for Natural Resources Canada for 32
years and mapped Canada’s coal and coal bed methane fields. He has also
served on Canada’s Natural Gas Potential Committee and is regarded as
one of the continent’s top global energy analysts. (B.C. politicians
take note: Hughes lives on Cortes Island on the West Coast.)

“Natural gas is a truly important resource.
But industry has overblown what shale gas can do for us,” says Hughes.
“Shale gas is an exercise in creating greater complexity with lower and
lower returns.”

Shale industry ‘hubris’

Until shale gas appeared on the scene,
analysts predicted a high noon for natural gas. Gas production in the
U.S. peaked in 1973, and has been on a bumpy production plateau ever
since. But then companies started to use horizontal drilling, combined
with hydraulic fracturing, to open deep rock formations once considered
as inaccessible as bowhead whales in the Arctic.

Hydraulic fracking, a high-energy technology that uses millions of gallons of water, sand and toxic chemicals to blast open methane trapped in dense rock, created a shale boom from Pennsylvania to northern B.C. and beyond.

The fracking energy binge, which
industrializes rural landscapes, sparked moratoriums in Quebec and New
York due to widespread concerns about surface and groundwater
contamination, and earthquakes from reinjected fracking fluids. U.S.
Energy Minister Steven Chu just ordered a high level investigation on fracking issues. Even France has banned the practice to protect its water-dependent cheese makers and grape growers.

Although T. Boone Pickens, the natural gas
lobby and some environmental groups now champion shale gas as a
“transition fuel” that could possibly retire coal plants and even power
vehicles, Hughes says the real production numbers don’t add up without
unprecedented levels of drilling.

For starters, industry hubris simply defies
the law of thermodynamics. From 1990 levels, U.S. gas drilling tripled
to 33,000 wells per year between 2006 and 2008 before collapsing back to
20,000 wells. In order to build a modest 21 per cent increase in
natural gas production, the gas industry constructed a complex
infrastructure nearly 100 per cent larger than what previously existed
in 1990.

“What matters are flow rates and how fast
the gas can be produced,” explains Hughes. “There may be 100 years worth
of methane in the ground, but it may take 800 years to produce it.”
Meanwhile, conventional gas production in both Canada and the U.S. is
declining rapidly. In other words, shale gas might temporarily replace
some of the air leaving the conventional gas tire — but not for long.

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