Category: Blog (Page 5 of 10)

The 21^st Annual Energy Policy Conference/Summit, was held in Tulsa at the Hyatt Regency Hotel on October 17^th forty years to the day of the Arab Oil Embargo that has since made a major impact on the US energy industry and our economy.  In addition to global and domestic energy policies and issues being addressed, two areas were of specific focus:  taxes and regulations.

The reason I founded the conference in 1992 and continue to chair the annual event is that it brings stakeholders together from not only the energy sector but also concerned citizens, representatives from government, agriculture, education, business, students and others.

The tax panel was moderated by Tulsa Mayor Dewey F. Bartlett, Jr.   The panelists were Chad Warmington, President of the Mid-Continent Oil & Gas Association, Mike McDonald, Co-Owner of Triad Energy, Inc., and Bruce Heine, Director of Government Affairs for Magellan Midstream Partners.

US Congressmen James Lankford, Jim Bridenstine and Mike Pompeo addressed energy policy issues.

Oklahoma Corporation Commissioner Patrice Douglas provided a legislative update.

Oklahoma Corporation Commission Chairman Patrice Douglas stated “coal is what they’re talking about now, but they’re coming after natural gas”.

The regulatory panel was moderated by Bob Tippee, Editor of the Oil and Gas Journal, Houston, Tx.  The panelists were Kurt Abraham, Executive Editor of Gulf Publishing Co./World Oil magazine, William Yeatman, Energy Policy Analyst of the Competitive Enterprise Institute, Steve Higley, Outreach Director for American Fuel and Petrochemical Manufacturers, and Joe Craft, CEO and a Director of Alliance Resource Partners, LP.

Bob Tippee stated, “The Environmental Protection Agency is getting ready to regulate greenhouse gases in the same way it just clobbered coal.”

Oklahoma State Attorney General Scott Pruitt presented the conference with a litigation update.

Eight 2013 Energy Visionary Awards were presented at the conference:  Alliance Resource Partners CEO Joe Craft, leadership award; Helmerich & Payne CEO Hans Helmerich, lifetime achievement; Love’s Travel Stops, corporate leadership; Hutchinson Oil Co., corporate development; Oklahoma Energy Resources Board, education; Darlene Wallace of Columbus Oil Co., industry achievements; and the “Exploring Energy” radio show hosted by Shawn Wilson and Nathan Brewer, outstanding media.

Next year’s conference date and location will be announced in December.

America Needs America’s Energy now more than ever!  Together we can create the People’s Energy Plan!  www.peoplesenergyplan.com

Facebook:  America Needs America’s Energy with 7000 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

Geothermal energy emanates from the natural heat of the earth.  Using steam from the geothermal reservoir coming from the wells, heat is routed to generators to produce electricity.  Also, generating plants use water at temperatures greater than 360 degrees Fahrenheit, pumping it under high pressure to generation equipment at the surface.  The heat from geothermal energy can be used directly for heating and air conditioning units, as well as to heat water.

The US has geothermal plants, which are mainly located in Nevada and California.  At present, California exceeds all states in geothermal usage, but such energy can be tapped in most locations with the use of geothermal heat pumps.  The current cost for usage is approximately 5 cents per kilowatt.  Great potential for the use of geothermal energy exists nationwide and worldwide.  Over 150 power plants are under development in more than a dozen states, which will triple geothermal generating capacity in the US.

Geothermal Pros:

1)  Direct use of geothermal energy is available for consumer applications.  2)  Geothermal energy is clean, with low emissions.  3)  Geothermal energy is available around the clock.  4)  Geothermal energy is domestically based.  5)  Geothermal is a renewable source.

Geothermal Cons:

1)  Installation of geothermal energy plans requires wide spaces and long pipes.

2) Therefore, areas of dense population can experience longer times to get energy.

Our national security has long been one of the most important assets we cherish.  For that reason we cannot afford to become addicted to energy at any cost.  Today, nothing in America moves without energy, but the definition of energy security also extends to power generation.  To be independent means not just avoiding foreign oil, but creating a forward-thinking infrastructure that provides for our lifestyle needs.

The important news is that some people in the US aren’t waiting for a mandate.  As I travel across the country educating people about the need for America to deploy its own natural resources, I have discovered cities are already looking at different approaches.  For instance, Austin, Texas is testing a smart grid, a biomass plant is operating in Wichita, Kansas, and in North Dakota the emphasis is on oil.  Other cities are looking at wind power, natural gas and other options.

America Needs America’s Energy now more than ever!  Together we can create the People’s Energy Plan!  Go to www.peoplesenergyplan.com to join the effort of striving toward “creating together the people’s energy plan”.

Facebook:  America Needs America’s Energy with 6500 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

Many believe that corn is for eating and should not be used as a fuel in Americans’ autos.  There are also many who believe that corn is essential to providing an alternative to OPEC by providing ethanol as the solution.

Biomass is a plant matter used to create energy.  For example, ethanol is a fuel that can be made from plants such as switch grass, and at one time was seen by the government as a solution to reducing America’s dependency on foreign oil.  “E10”, a blend of 90 percent gasoline and 10 percent ethanol, is in use throughout the US.  Most cars can run on E10.  “E85” is a blend of 85 percent ethanol and 15 percent gasoline, known as “flex fuel”, and can power some automobile engines as well.

Biomass Pros:

1) Ethanol can be used to make a variety of fuels to generate electricity.  2) Ethanol can be used for the production of chemical products.  3) Ethanol is an abundant natural resource.

Biomass Cons:

1) Biocrops have a higher value than food; therefore they can detract from food production, leading to food shortages and increased prices for food.  2)  Many pollutants are released into the atmosphere in the production of ethanol.  3)  Ethanol fuels have been heavily subsidized by the US government.

According the Wall Street Journal, August 17-18, 2013, “One of the biggest debacles has been the law’s (Renewable Fuel Standard, RFS) requirement that the oil and gas industry mix cellulosic ethanol—made from the like of switch grass and wood chips—into gasoline.  The original law mandated the use of one billion gallons of cellulosic fuel in 2013, with even higher levels through 2022.  This may have been the worst government forecast in history, which is saying something.  Even with taxpayer subsidies…The government was off by a mere 99.9%.”

Should the mandate be repealed?  Are you using ethanol or do you have plans to use ethanol?

These are some of the many questions that everyone should answer for planning our energy future.

In my book, America Needs America’s Energy, there is a Personal Energy Journal.  Please join me in developing your own personal path to an energy strategy by completing these forms, which will guide you in assessing how you are personally using energy and understanding how you use energy as a consumer impacts energy issues and development.

America Needs America’s Energy!  Go to www.peoplesenergyplan.com to join the effort of striving toward “creating together the people’s energy plan”.

Facebook:  America Needs America’s Energy with 6500 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

Several years ago, I had the opportunity of serving on an advisory committee appointed by the Mexico Trade Commissioner who was based in the Dallas, Texas regional office.  The advisory committee’s focus was trade and tourism between Mexico and the US.  The committee was comprised of US and Mexico business representatives.

One issue that was addressed was US and Mexico energy relations.  Since 1938, Mexico has been under strict governmental guidelines with no privatization in place.

In August of this year, President Enrique Pena Nieto proposed plan to open its oil and gas sector to foreign investments through private-public partnerships.

Also, in August, I was interviewed for an article in the Wall Street Journal’s MarketWatch regarding the issue of “why foreign oil forms should look to Mexico”.

I share with you some of the questions that were asked and the answers that I provided:

1) From an energy commodity standpoint, what does an open Mexico energy market mean—would opening that market up be substantial for oil or natural gas?  How so?

Over the past several years, there has been an oil production decline in Mexico.  Mexico has strong potential to enhance oil and gas production by the support of US technology alone.  With US technology and expertise, Mexico and North America could potentially benefit in a very positive way.  With that said, there are a lot of details to work out.

2) How long, realistically, might it take to get the proposal approved?  What’s involved?  It is my understanding that the proposal has a strong chance of passage.  There is opposition to the proposal.  Introducing a private-public partnership is new to a country which has not allowed the needed expertise to advance the needed economic benefits.  Therefore, many US companies will be interested in the potential opportunities but with caution especially in the early stages.

3) How long before foreign companies jump in and how willing will they be to participate in Mexico?

It appears that US companies are interested in the potential but there has to be certainty of stability before US companies spend the billions of dollars necessary for oil and gas development.

4) Which nations or companies might benefit the most and why?  Service and supply companies in the early stages will probably benefit the most.  There is a question to be addressed whether only majors will be involved or will there be opportunities for others to enter the market.

Go to www.peoplesenergyplan.com to join the effort of striving toward “creating together the people’s energy plan”.

Facebook:  America Needs America’s Energy with 6500 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

Forty years ago, October 17, 1973, the Arab oil embargo began as agreed to by the OPEC oil ministers.  Since that time, beginning with the embargo, US energy and economic direction has been impacted due to that decision.  (The members of the Organization of Arab Petroleum Exporting Countries (OAPEC) initiated the oil embargo.)

A few months later, (1974) The International Society of The Energy Advocates, now known as The Energy Advocates, was founded.  The mission of The Energy Advocates was to educate the public about energy issues and policies, therefore, combating the OPEC stronghold.

The Organization of Arab Petroleum Exporting Countries was established for the express reason of exerting pressure on the western nations pledging support to Israel at the time.  This was the beginning of an organized and official political movement against the West.

This would be the first time the Arab (OPEC) nations would wield the oil.  At a time when America was experiencing upheaval and uncertainty on nearly all socio-economic fronts, the energy crisis threatened the very fabric of the American way of life.

Prices reacted almost instantly, and the effects of the Arab oil weapon were felt by citizens across America.  Fuel shortages were commonplace during the period of the fall of 1973 to the summer of 1974.  This was the first time since World War II that US citizens experienced lines at the pump.  This cut in the global supply of oil was devastating to the US economy, and soon other western nations experienced high inflation and economic recession.

Now 40 years later, America is turning the corner.  The US today has been proven to possess an abundance of both oil and gas.  There is the rallying cry for American energy independence that many in the industry believe is achievable.

Despite this move in the right direction, however, we cannot afford to let up in our national quest to achieve total energy independence.  It would only take a political crisis like Iran blocking the Strait of Hormuz to hold a percentage of the world’s oil hostage and drive oil prices up.  Our energy security still needs to be addressed through the development or a comprehensive domestic energy policy.

The founders of The Energy Advocates would be proud to know that America is becoming less dependent on OPEC.  America Needs America’s Energy now more than ever!

Go to www.peoplesenergyplan.com to join the effort of striving toward “creating together the people’s energy plan”.

Facebook:  America Needs America’s Energy with 6500 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

For years the public perception of the energy industry has been that of fat cats, ruthless J. R. Ewing types who make a killing off oil in their own backyard.  Other pervasive myths about the industry include a belief that oil companies do not pay their fair share of taxes, that they make windfall profits and are “colossal giants’ owned by a ruthless group of “them”, that the industry gouges the consumer, and that energy companies destroy the environment and endanger species.

When it comes to the stereotype of J. R. Ewing, nothing could be further from the truth.  Today, thousands of individuals in this country operate marginal wells—those producing ten barrels a day or less—that not only provide these people with a living, but also account for nearly 60 percent of our domestic production.  What’s more, in Pennsylvania’s Marcellus shale formation, hundreds of mineral and royalty owners are now benefitting financially much like those in the Anadarko Basin and throughout our region from oil and gas lease bonuses.  This relatively new exploration activity also accounts for 72,000 plus new jobs in Pennsylvania since 2009.

According to data compiled by the American Petroleum Institute, US oil and gas companies made an average of 9.5 cents on every dollar of sales in the second quarter of 2011 compared with 10 cents per dollar of sales for all manufacturing.  According to Yahoo! Finance, of the top 114 industries according to net profit margin, independent oil and gas ranked number 80 with 8.3 percent, along with health insurance at 8.1 percent, and aerospace and defense at 6.6 percent.  The top of the list included application software at 22.7 percent, soft drinks at 14.3 percent and wireless at 14.1 percent.

From a sheer market value perspective several years ago Royal-Dutch, Anadarko, Marathon, and Devon could not compare to Wal-Mart and Apple.  Of the top fifty US companies listed by Yahoo! Finance under the category of market value, only four were oil and gas-related companies.  Under the category of the top fifty US companies ranked by equity, only five were from the oil and gas-related companies.

It is also perceived that oil and gas companies destroy the environment.  Though there have been some companies that have not lived up to protecting the environment, today’s oil and natural gas companies overall are in the forefront of environmental protection and increasingly finding that exploration and wildlife preservation can not only peacefully coexist but in some cases be mutually beneficial.  For instance, Alaska Governor Sean Parnell testified to House Resources Committee in September 2011 that Prudhoe Bay, located sixty miles west of ANWR, has been operating for over thirty years and produced more than sixteen billion barrels of oil so far.  Amidst that activity, the Central Arctic caribou herd at Prudhoe Bay has grown from 5000 in 1975 to over 67,000 in 2008.  This rarely reported good news is due to the heat of crude passing through the pipeline which warms the tundra topsoil, causing grasses to sprout where they had never grown before.  As a consequence, caribou herds and other wildlife have not only survived, but thrived.

What do you think?  Does America Need America’s Energy?  If so, how should we go about it?:  America Needs America’s Energy:  Together We Can Create America’s Energy Plan!

Note the 2013 International Energy Policy Conference Summit will be held in Tulsa, Ok., October 17^th, go to www.energypolicyconference.com to learn more.

Go to www.peoplesenergyplan.com to join the effort of striving toward “creating together the people’s energy plan”.

Facebook:  America Needs America’s Energy with 5800 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

The 2008 economic stimulus package passed by the US Congress set aside $21.5 billion for scientific research, as well as $5 billion for weatherization of houses, $11 billion for updating the electric grid, and $2 billion for advanced automobile battery technology.  Additional grants and funds were also made available for other energy projects.

Instead of launching us further into energy independence government involvement seems to push us back economically, as well as directing us even more dependent on foreign energy sources.  It’s one thing for the government to experiment and fail.  But when a company like Solyndra is up and running for just a year or two, spends over $500 million, and then goes bankrupt, is that proper use of our funds when we are in an economic downturn?  As the Wall Street Journal noted in September 2011, the $535 million Solyndra project is just one in a string of failures, with the Department of Energy shoveling over $1 billion in new loan guarantees to solar projects in Nevada and Arizona, and more deals pending.

Shouldn’t the US government focus on areas like better technology for natural gas?  For example, Schlumberger is a service company involved in putting proper water treatment in place in areas undergoing hydraulic fracturing.  So we are starting to see technology that complements what we are already doing, instead of just handing out over $500 million as was done with Solyndra and seeing if some new product pans out.

Government assistance and money could also have been used more beneficially in rebuilding energy infrastructure.  In this case, public-private partnerships are necessary.  For example, if we would have put that $500 million into building Compressed Natural Gas (CNG) fueling stations, it would have been a great shot in the arm for the natural gas sector and the energy business overall.  We could have started with government fleets nationwide, but it would also have extended into the public arena.  Today, many UPS trucks, as well as public buses in Los Angeles for example are CNG-fueled.  The benefits are enormous:  The cost of CNG fuel is roughly 50 percent less than the $3.50 to $4.00 per gallon for normal gasoline, and in some areas of the country, even lower than that.  CNG is also an environmental plus, as it burns much cleaner and is better for the engine as well.

The TransCanada Corp’s Keystone XL Pipeline is a perfect example of government policy working against our energy independence.   On the one hand, our government said yes to Solyndra, but no to permitting the Keystone pipeline, which is a privately funded project.  Keystone could not only have provided twenty thousand jobs in a down economy, saving taxpayer dollars on unemployment, but more importantly, it could have helped make us less dependent on our enemies for oil.

What do you think?  Does America Need America’s Energy?  If so, how should we go about it?:  America Needs America’s Energy:  Together We Can Create America’s Energy Plan!

Note the 2013 International Energy Policy Conference Summit will be held in Tulsa, Ok., October 17^th, go to www.energypolicyconference.com to learn more.

Go to www.peoplesenergyplan.com to join the effort of striving toward “creating together the people’s energy plan”.

Facebook:  America Needs America’s Energy with 5800 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

In 2008, I mentioned in my book “The Braking Point” that the US Energy Information Administration (EIA) outlined the strategic importance and associated threats facing each oil-exporting country, some of which provide us with petroleum:

Algeria:  Armed militants have confronted government forces

Bolivia:  Large reserves of natural gas; exports may be delayed due to new laws unfriendly to foreigners

Caspian Sea:  BTC pipeline now open; many ethnic conflicts; high expectation of future oil production in the region; no maritime border agent

Caucasus Region 2:  Strategic transit area for natural gas and oil pipelines

Columbia:  Destabilizing force in South America; oil exports subject to attack by protesters; armed militants

Ecuador:  Unstable politically; protests threaten oil exports

Indonesia:  No longer a net exporter; separatist movements; peacekeeping force in place; violence threat to Strait of Malacca

Iran:  No direct exports to US but exports 2.5 million barrels daily to other world markets

Iraq:  From 2003 to 2005 there were 236 attacks on the oil infrastructure

Libya:  Newly restored diplomatic relations; Western IOCs not awarded contracts in send EPSA round

Nigeria: High rate of violence and crime; large income disparity; tribal and ethnic conflict and protests have repeatedly suspended oil shipments

Russia:  Yukos Oil Affair has bred uncertain investment climate

Saudi Arabia:  Long-term stability of al-Saud family; Western oil workers subject to attacks

Sudan:  Darfur Crisis and North-South internal conflict threatens government stability; security of oil transport at risk

Venezuela:  Large exporter to the US; President Chavez frequently threatens to divert those exports and nationalize the source base.

Now:  Most of the potential security threats in these countries remain and in some cases have heightened.  More threats in other areas of the world have also surfaced.  For instance, if Iran attempts to close the Strait of Hormuz, our energy security is in jeopardy from the standpoint of price and supply.  In addition to the threats already mentioned, America faces potential internal terrorist attacks and cyber-security threats on our energy infrastructure that could wreak havoc on the citizenry and imperil national security.

These threats to our energy security, both external and internal, make it even more clear that America Needs America’s Energy and energy independence; by that we mean total freedom from the reliance on energy sources questionable to our national interests.   The goal is to replace all foreign oil from countries with even a question of being hostile to us or of being in an alliance with us.

America Needs America’s Energy!   Together we can create America’s Energy Plan!

Note the 2013 International Energy Policy Conference will be held in Tulsa, Ok., October 17^th, go to www.energypolicyconference.com to learn more.

Go to www.peoplesenergyplan.com to join the effort of striving toward “creating together the people’s energy plan”.

Facebook:  America Needs America’s Energy with 5800 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

About twenty years ago, I had the opportunity of meeting George Mitchell in Houston, Texas.  George Mitchell who recently died at age 94 was an engineer who has dramatically impacted the oil and natural gas industry.  George Mitchell was known as the father of hydraulic fracturing.

George was highly respected in the oil and gas industry.  In fact, in the 30 plus years that I have been traveling to Houston on energy business, whenever George Mitchell’s name was mentioned I only heard positive remarks.  He was truly a gentleman.

I share with you some of the remarks taken from his obituary, about his life:

“He was one of the elite corps of engineers whose ideas, ingenuity and persistence changed the world.  He was the father of “fracking”, hydraulic fracturing, the process by which dense shale rocks deep underground are blasted apart to release the gas and oil trapped within.

His innovations, developed over several decades, started an engineering revolution that is transforming the US from a guzzler of imported fuel to an energy-independent nation.  His influence along with his innovations in getting hard-to-reach fossil fuels out of the ground, have arguably had more effect on US foreign policy than any statesmen since the start of the cold war.”

He was born in Galveston, Tx., and was the son of poor Greek immigrants.

He gave back through his charitable foundation giving over $400 million to many causes.

“In the late 1990s, after nearly two decades of painstaking experimentation, Mitchell’s pioneering techniques began to bear fruit.  He expanded his fracking operations rapidly and soon attracted the attention of the oil and gas majors.  In 2002, he sold his company to Devon Energy Corporation for $3.5 billion dollars.”

He had drilled over 10,000 wells before selling his company to Devon.

Many know of George Mitchell because of his establishment of the Woodlands in north Houston, Tx.

“Mitchell’s genius was to bring to bear advances in technology that allowed the massive drilling equipment used to carve out vertical wells to be turned around, underground, to drill horizontal tunnels.  The result was revolutionary.  Whereas vertical wells were necessarily limited in the amount of gas they could bring to the surface, once it was possible to have horizontal wells branching in all directions—imagine a Christmas tree—the yields increase exponentially.  Rock formations could be fracked and fracked again over huge areas underground, with only a small footprint revealing its presence at the surface.”

Many thanks to George Mitchell for his leadership, his vision and his care for others…he has left truly a great legacy!

America Needs America’s Energy!   Together we can create America’s Energy Plan!

Note the 2013 International Energy Policy Conference will be held in Tulsa, Ok., October 17^th, go to www.energypolicyconference.com to learn more.

Go to www.peoplesenergyplan.com to join the effort of striving toward “creating together the people’s energy plan”.

Facebook:  America Needs America’s Energy with 5700 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!

Coal probably does not come to mind to most people when talking about the energy industry in Oklahoma.  The oil and natural gas sector seems to be always referenced when thinking about Oklahoma’s energy industry.

Oklahoma’s coal is definitely not a major component in the US coal market.  However, the Oklahoma coal industry has an impact of $60 million per year in the eastern part of the state.

Some facts about the Oklahoma Coal Industry:

1) The coal industry was founded near McAlester, Ok. in the 1880s.

2) In 2010, over 1.1M tons were produced.

3) There are 4 operating coal producers in the State with 3 new groups opening mines in 2013 and 2014.

4) Oro Mining of Australia has permitted for a mine near Heavener, Ok.   The mine expected to generate 200 mining jobs and 200 indirect jobs.

5) Spiro Mining Company has opened a mine near Spiro, Ok.

6) Farrell Cooper Mining has received a federal permit to develop a large underground mine near McCurtain, Ok.

Since a quarter of the world’s coal reserves are located in the US, it has long been considered a major natural resource for America’s energy future.  Coal is currently mined in twenty-six states with Wyoming, West Virginia, Kentucky, and Montana leading in coal production.  Most of the coal in the US is mined for the use of generating electricity, and it provides over half of this country’s electricity generation power.  In 2007 coal accounted for 27 percent of world energy consumption.  We have enough coal in the US to last close to 250 years.

Canada is the largest importer of US coal.  Outside of this country, the two top deposits of coal are located in Russia and China.  It is currently projected that world coal consumption will increase by 56 percent from 2007 to 2034, with US coal consumption during that same time frame expected to increase by a little over 1 percent.

The opposition to coal, however, is that it is not a viable option because of the environmental pollution it produces.  Due to the enormous pressure to clean up this pollution, the US government has stepped in to develop technologies for emission-free coal plants that will capture CO2 so that is does not enter the atmosphere.

Please let us know what you think about the future of coal, www.peoplesenergyplan.com

America Needs America’s Energy!   Together we can create America’s Energy Plan!

Go to www.peoplesenergyplan.com to learn more, and to join the effort of striving toward “creating together the people’s energy plan”.

Facebook:  America Needs America’s Energy with 5700 supporters plus and growing.  —   America Needs America’s Energy:  Creating Together the People’s Energy Plan!