Author: GTD Group (Page 3 of 23)

The energy sector, especially the oil and gas industry, is facing many legislative and regulatory challenges.

According to the Texas Alliance of Energy Producers, the Attorney General for Texas, for example, has filed twenty-four lawsuits that include, in part:

1) Environmental Protection Agency’s (EPA) rule that imposes new standards on oil and gas operations, including emission reductions during completions on wells that have been fractured, which is also known as “green completions”.

2) EPA’s disapproval of Texas Regional Haze plan.

3) EPA’s designation of Wise County as an ozone non-attainment area.

4) EPA’S Mercury and Air Toxics Standards rule.

5) EPA’s Cross-State Air Pollution rule.

6) EPA’s greenhouse gas state implementation plan and the disapproval of Texas’ flexible permit rule.

7) The Federal Energy Regulatory Commission’s rule that compelled intrastate natural gas pipelines to make daily Internet posts about the intrastate business practices. — The Obama administration has put together an interagency working group to coordinate agency policy activities of 13 bureaucracies that deal with oil and gas issues.

The Texas Alliance of Energy Producers goes on to report that “invasive, unnecessary changes to current operational procedures for oil and gas activities have been proposed or adopted by numerous federal agencies. For example:

1) The Bureau of Land Management (BLM) has proposed regulations to mandate permitting for oil and gas producers before performing hydraulic fracturing, and before diesel fuel can be used in drilling and completion operations.

2) The Environmental Protection Agency has revised its New Source Performance Standard (NSPS) of fractured natural gas completions and storage tank requirements.

3) EPA’s Clean Water Act Effluent Limitation guidelines for produced water, developed regulations for oil and gas activities on “waters of the United States,” and promulgate guidance related to seismic activity.

Dr. John Deutch, former US Deputy Secretary of Defense, former Director of Central Intelligence under President Clinton, professor at MIT and who was interviewed and greatly assisted with the film/documentary “The Grand Energy Transition” which I co-produced, states “a big deal has happened in the United States—a big deal for the United States and for the rest of the world—and that is the explosion of unconventional oil and gas resources and production.”

It is important that a balance between energy and environment be reached along with being maintained. America needs America’s energy and America needs to preserve its environment. How the oil and gas industry manages and addresses the energy and environmental concerns facing America should and will remain front and center.

Thomas A. Carr, an expert witness, testified before the US Commerce Committee in 1974 and stated, “the word ‘energy’ incidentally equates with the Greek word for ‘challenge.’ I think there is much to learn in thinking of our federal energy problems in that light. Further, it is important for us to think of energy in terms of a gift of life.”

The message is clear: America Needs America’s Energy! Together we can Create the People’s Energy Plan! Go to www.peoplesenergyplan.com to join the effort.

Facebook: America Needs America’s Energy with over 10,000 supporters plus and growing. — America Needs America’s Energy: Creating Together the People’s Energy Plan!

During a recent visit to Washington, DC, I found that the mood of the odds for passage of major overhauls of the US tax code by Congress in 2014 was not optimistic. The main reason was the upcoming elections.

Note the following as noted by World Alliance for Decentralized Energy (WADE):

The Obama budget proposes –

1) Permanently extend the production tax credit (PTC) and, starting with projects that begin construction in 2015, the PTC would become a refundable credit, reducing the need for investors to offset taxes. The PTC would become available for electricity directly consumed by producers as well as electricity sold, and solar projects would become PTC-eligible in 2015.

2) The investment tax credit (ITC) would be repealed for projects placed in service after 2016. This applies for both the current 30% temporary credit and the 10% permanent credit.

3) The credit for second generation biofuels would be extended to 2020 and then gradually repealed by 2024. The 30% tax credit for investments in eligible property used in a qualifying advanced energy project, currently limited to total credits of $2.3 billion, would have additional credit authority of $2.5 billion.

4) Multiple provisions would reduce or eliminate tax benefits for oil and natural gas producers. This includes repeal of the Enhanced Oil Recovery (EOR) credit; the credit for marginal well; expensing of intangible drilling costs, deduction for tertiary injectants; exception for passive loss limitation for working interests in oil and natural gas properties; percentage depletion for oil and natural gas wells; and, domestic manufacturing deduction for oil and natural gas production.

House Ways and Means Committee Chairman Dave Camp (R-MI) budget proposes –

1) The credits available for alcohol fuels and alternative fuels (which expired at the end of 2011) and for biodiesel and second generation biofuels (which expired at the end of 2013) would not be extended and therefore effectively repealed.

2) The PTC would be reduced and then eliminated for generation of electricity from wind, biomass and other renewable resources.

3) The ITC for construction of solar and other renewable energy facilities would be repealed. The repeal would affect the tax credit for projects that are completed after 2016, including those that claim the ITC in lieu of the PTC.

4) Repeal of other renewable and alternative tax credits.

5) Repeal of oil and natural gas incentives, including the EOR credit; the credit for marginal wells; exception to passive loss limitation for working interests in oil and gas properties; and percentage depletion for oil and gas wells.

It does not look likely that either President Obama’s or Representative Camp’s proposals will be passed as a whole. However, it is possible that some of the tax reform proposals could be included in other must-pass bills to offset future spending programs or to provide tax credits, according to WADE.

The US Bureau of Labor Statistics states that the number of news jobs in the oil and gas sector has increased by 270,000 between the years 2003 and 2012. The oil and natural gas industry is a driving force in America’s economy. We need to support our oil and natural gas industry. This support leads to America’s Energy Security!

America Needs America’s Energy: Together we can Create the People’s Energy Plan!

Go to www.peoplesenergyplan.com to join the effort.

Facebook: America Needs America’s Energy with over 10,000 supporters plus and growing. — America Needs America’s Energy: Creating Together the People’s Energy Plan!

Recently, I completed reading a book entitled, “The Metropolitan Revolution” written by Bruce Katz and Jennifer Bradley. The book is about how cities and metros are fixing what the authors describe as “our broken politics and fragile economy”.

There are many sectors and issues addressed in the book. The outlook for America’s energy usage and planning is one of the sectors/issues addressed.

There is the definite push worldwide for “energy sustainability”. Energy efficient technologies are at the forefront of discussion.

According to the authors, “more than 6 billion people are expected to populate cities and metropolitan areas over the next several years, smart and sustainable municipal services, will be in high demand.” They go on to say, “cities and metropolitan areas in the United States are well positioned to continue to be at the center of the nation’s clean economy.” It is interesting that the authors use the word “clean”. Natural gas is definitely clean and abundant.

The book provides several statistics that I found interesting, including: 1) the largest metros in the US are home to 78 percent of the jobs in solar energy, 80 percent in wind energy, and 83 percent of the jobs in energy research, engineering and consulting services. This book finds, therefore, challenges that smaller communities will face in order to be competitive or they could be left behind.

I found this book to be a tool for important dialogue not only for metropolitan areas but also for any towns and cities across the US. Leaders who have vision and foresight for their communities are needed.

In planning for America’s energy future, the book points out that “over the past century, the average size of a household declined from 4.60 persons in 1900 to 3.38 in 1950 to 2.58 in 2010…in 1983 nearly half of young Americans had a driver’s license; today, only 29 percent do.” So there is definitely a shift in energy usage in America’s future.

According to one study, the projection is “that the total investment required in transportation, electricity, water, and other infrastructure to keep pace with population growth in emerging market cities in Asia and Latin America over the next twenty years will be $30-40 trillion—about 60-70 percent of the total global investment in infrastructure.” Therefore, America’s energy expertise will play an important role as well as to our own energy usage.

Despite all the concerns related to the moving parts of the energy industry and future energy usage, there is good reason to be optimistic. Right now we are seeing a shale play throughout the country.

As Ambassador Jeane Kirkpatrick stated “the elements of our (country) strengths are many. They include our democratic government, our economic system, & our natural resources.”

Bottom-line, America’s energy future is in our hands. We need to make plans. President George Washington stated, “A people…who are possessed of the spirit of commerce, who see and who will pursue their advantages, may achieve almost anything.”

Things are changing, shifting. We need to be the leaders of the opportunities ahead. Together we can Create the People’s Energy Plan! Go to www.peoplesenergyplan.com to join the effort.

Facebook: America Needs America’s Energy with over 10,000 supporters plus and growing. — America Needs America’s Energy: Creating Together the People’s Energy Plan!

“2014: The New Energy Revolution” was the recent topic of a presentation by William A. Mogel, Partner of Mogel & Sweet, Washington, DC at the University of Tulsa College of Law.

William (Bill) Mogel who is a long-time friend asked that I attend this presentation. Bill was the Founding Editor-in-Chief of Energy Law Journal.

Bill began his presentation with a quote from Daniel Yergin “the development of shale gas and tight oil in the United States constitutes an ‘unconventional revolution,’ owing to its scale and speed. It is already having a profound global impact: upending energy markets, reshaping competitiveness in the world economy as a whole, and portending major shifts in global politics.”

Some of the facts Bill presented were: Shale Gas –

1) In the US, fracking began in 1940; today, 35,000 wells fracked per year,

2) shale gas accounts for ½ US production (65 Bcf/d), and

3) thousands of new jobs created.

Shale Oil –

1) US production increased 60% since 2008 to 3 million barrels/year,

2) Imports are down from 1.6 mb/d in 2006, and

3) US Congress is considering 1970s export ban on domestic crude. LNG Exports- US is switching from being an importer to an exporter.

Bill emphasized the importance of natural gas. The environmental impact of moving to natural gas is significant. By 2040, Bill states that 60% of additions to power generation will be fueled by natural gas.

He stated that the challenge ahead is that America has 5% of the world’s population but consumes 20% of the world’s energy. The energy policy needed will embrace efficiency, technology and infrastructure which he believes leads to the use of natural gas. Utility fuel switching means cleaner power plants. National security and the balance of payments are important parts of the equation.

He quotes US Senator Lisa Murkowski who states that America needs “more production, clean energy technology, an improved energy delivery infrastructure, effective government oversight, environmental responsibility and an energy policy that pays for itself.” United States energy independence is now possible. The world energy trade market is not going to vanish but the strangleholds, i.e. OPEC, Russian gas are less powerful.

The new revolution brings economic benefits:

1) Increased economic security for the US,

2) Less dependence on unstable foreign markets, and

3) Increased domestic manufacturing.

As I stated in my book, “America Needs America’s Energy: Creating Together the People’s Energy Plan”, “future generations are depending on us to keep the American dream alive. We need this energy revolution and we must be the leaders. Our national security has long been one of the assets we cherish, and we cannot afford to continue relying on foreign nations to fulfill our energy needs or miss the opportunity to create a forward-thinking infrastructure that will support the American way of life. Energy is the future of America and America Needs America’s Energy!”

Together we can Create the People’s Energy Plan! Go to www.peoplesenergyplan.com to join the effort.

Facebook: America Needs America’s Energy with over 10,000 supporters plus and growing. — America Needs America’s Energy: Creating Together the People’s Energy Plan!