Gas Report Is Good News

August 15, 2011
By The Intelligencer , The Intelligencer / Wheeling News-Register

Given President Barack Obama's record on energy issues, the verdict of a panel he convened on natural gas drilling may have come as a surprise to some. It certainly is a welcome one.

Obama and his Environmental Protection Agency have been harsh in their treatment of some conventional energy industries, such as coal. But a special committee formed to investigate new gas drilling technologies has, in essence, given the industry a clean bill of health.

John Deutch, chairman of the Shale Gas Subcommittee in the Department of Energy, told a reporter the economic benefits of gas drilling "massively outweigh" environmental and public health concerns. "If you do it right, the balance is enormously on the side of production," Deutch added.

However, Deutch and his committee were right to add caveats to their overall conclusions. Companies should release lists of chemicals used in "fracking" rock formations to release gas, the panel recommended (some already do that). More basic research on gas and drilling for it is needed, the committee stressed. And, as officials in many states already have recognized, drilling regulations need to be updated.

As far as the environmental impacts of fracking go, the panel stressed it "shares the prevailing view" that the practice poses a low risk to water supplies.

No doubt skeptics will condemn the report as overly friendly to the gas industry. It needs to be kept in mind, however, that the committee was formed by Energy Secretary Steven Chu, who certainly cannot be described as being in industry's hip pocket.

The committee's report is good news indeed - but its specific suggestions need to be stressed. Indeed, more emphasis should be placed on requiring gas companies to use "best practices" in drilling. Updated regulations, preferably at the state level, are needed badly.

And, as we have pointed out, the gas industry needs to be more attentive to certain issues, such as traffic safety involved in moving big, heavy trucks on rural roads.

Natural-gas supply is a sparkplug for state

By This email address is being protected from spambots. You need JavaScript enabled to view it., PITTSBURGH TRIBUNE-REVIEW
Sunday, August 14, 2011

Raymond J. Bologna has a 1,300-foot-high coal pile and tried for more than 20 years to build a power plant to burn it.

The economy's collapse killed his last good chance to make it happen, but he hopes that natural gas — the new economic sparkplug — can revive his project.

Bologna wants to build two power plants at his site in Robinson, Washington County, one fueled by the waste coal piled there and another fueled by gas from the region's deep shale formations.

"We're here to create jobs and create value," Bologna said, promising an annual payroll of $6 million to $7 million and nearly 70 employees. "It looks like the Marcellus shale is going to get us there."

Because of high oil prices, energy markets haven't helped the nation's sputtering economy. But gas-powered businesses might be better positioned to blossom during tough times, analysts said.

"Cheap natural gas is the best thing to happen to the U.S. industrial economy in quite some time," said David A. Pursell, managing director and head of securities at Houston-based Tudor, Pickering, Holt & Co.

The wider economy, however, still suffers from high oil prices, he said. Consumer spending is so dependent on oil prices that recovery is difficult. He noted reports from Wal-Mart executives this spring that said gasoline prices forced shoppers to consolidate trips and buy less.

Natural gas supplies are likely to increase because of shale formations such as the Barnett shale in Texas and the Marcellus, which is providing a special boost for Pennsylvania, analysts said. Industries such as steel and glass should benefit from having a cheap fuel source nearby. And there's talk of building processing plants that could boost petrochemical and plastic industries in the region.

"That manufacturing sector has been sort of the bright spot, one of the few bright spots of the economy in the last couple years," said Seth Blumsack, assistant professor in the Department of Energy and Mineral Engineering at Penn State University.

Power plants should continue to be strong performers, experts said. Natural gas-fueled plants dominate the industry's plans and likely will be its growth sector, Blumsack said.

Bologna's Robinson Power Co. obtained a state permit for a natural gas plant but needs an environmental permit for the coal-burning plant, he said. He's negotiating with three companies he declined to name, to become an operating partner.

"You can never be worried," Bologna said about economic volatility. "Regardless of what happens, you have to be teed up and ready to go."

08/15/2011  MetroNews Staff Writer
Judge Strikes Down Morgantown Fracking Ban

Regulation of companies using the process of hydraulic fracturing to drill for natural gas in the Marcellus shale lies with the state Department of Environmental Protection, not the city of Morgantown, a Monongalia County judge ruled Friday.

(Read order here.)

Earlier this year, the city passed an ordinance that bans fracking within one mile of city limits.  Northeast Natural Energy Co., which has two drilling projects near Morgantown, took the city to court to get their drilling wells operational again.

On Friday, Monongalia County Judge Susan Tucker ruled Morgantown's ordinance to be invalid, clearing the way for Northeast to resume drilling.

In the court's opinion, Tucker said the state had exclusive control of regulation.  Tucker also noted strides made by the state to implement comprehensive rules for drilling.

"It is also apparent to this Court that the environmental issues are being addressed by our State government, as indicated by Governor Tomblin's July 5, 2011 Executive Order to the Director of the WVDEP," the ruling says.

Tomblin's executive order lays out regulations for Marcellus drilling.  The city of Morgantown cannot supersede those guidelines, Tucker ruled.

However, the court noted that fracking may present a number of environmental problems.  But the DEP is responsible for overseeing the drilling, the court ruled.

Northeast President Mike John says the company is now ready to continue drilling projects.

"We are pleased with the ruling, and we intend to continue to work in good faith with the Morgantown Utility Board, the City of Morgantown, and other stakeholders in Monongalia County," he said.

Chemical innovation enters a fluid debate

As new fracturing liquids arise, one company touts orange peels


Aug. 13, 2011, 1:02AM

Flotek Industries has a solution to the debate that surrounds hydraulic fracturing: turn the oil fields into orange groves.

Or, at least, make them smell like citrus orchards.

The Houston oil field supplier says it has patented a hydraulic fracturing fluid that replaces traditional chemicals with extract from orange peels, turning the conventional mixture of water and toxins into a sweet-smelling blend.

Hydraulic fracturing, a process for freeing oil and natural gas from dense underground rock that is fueling a boom in natural gas production, has drawn criticism for injecting potentially hazardous substances into the earth. The process typically flushes massive amounts of water mixed with sand and chemicals into wells under extreme pressure to break open the rock.

Flotek and other companies are jumping into the ring with solutions that seek to quell the feud between environmentalists, who say hydraulic fracturing threatens the ground water supply, and oil field operators, who say those fears are unfounded.

Cautious optimism

Their products intervene at various stages of the hydraulic fracturing, or fracking, process to reduce the potential for environmental harm by cutting back on chemicals or water usage, they say. They are growing in popularity and have prompted cautious optimism among some environmentalists.

"In general, they sound like a step in the right direction," said Amy Mall, senior policy analyst for the environmental group Natural Resources Defense Council. "We need scientific research to better understand their impacts."

Higher costs for some of the substitute fracturing fluids have limited the industry's widespread adoption of them.

And some industry insiders, who say the flap over fracturing is overblown, contend that methods employing chemicals with smaller warning labels are little more than public relations ploys.

"People have a strong interest in them, especially when the operators are having to report what they put in the well," said Michael Conway, president of Stim-Lab, a research and consulting company for the industry. But, he added, "In most cases, the changes are relatively minor."

A new Texas law will require well operators to report publicly what chemicals are used in their fracturing fluids starting as soon as next year.

Oil field services company Halliburton names on its website some ingredients for its version of environmentally conscious fracturing fluid, called CleanStim. The company notes that all of the ingredients are federally approved for use in food production — including maltodextrin, a sweetener, and partially hydrogenated vegetable oil, which prolongs foods' shelf lives.

The product reduces the use of some of the most disputed fluid components, including biocides that kill corrosive bacteria in wells and guar gum that thickens the fluid.

"It addresses those issues, a perceived concern with the chemicals that are used in hydraulic fracturing," said Matt Oehler, Halliburton's manager of global business development and marketing. "Whether the perception is real or not, to remove some of that chemistry is good."

Flotek developed its citrus-based fluid seven years ago, President John Chisholm said, before the crescendo of public concern about hydraulic fracturing.

"We looked at it for its technical benefits," Chis_holm said, noting that the citrus rind extract, called d-limonene, eases the flow of the well products to the surface.

"At the time, we didn't realize the impact of it being biodegradable," he said.

Although the company also sells conventional products, Chisholm said, the citrus fluid draws higher demand. Still, he says, the price for a product that has to be squeezed from oranges impedes its broader acceptance by oil field operators.

The same is true for Canadian company GasFrac Energy Services, which uses propane instead of water to complete fracturing jobs. The method mitigates concern about the large amounts of water typically used.

The volume of water in a single job can vary widely, but often ranges from 2 million to 6 million gallons, and most of the fluid and its contents remains trapped in the earth. The fluid that does return to the surface has to be disposed of as waste- water.

Propane doesn't leave behind the contaminants and sludge that water-based fracturing does, said Robert Lestz, chief technology officer for GasFrac.

"When we are using a fluid that costs $2 per gallon, versus water, at the front end it is more expensive," Lestz said. But the liquid propane gas "can be recaptured, resold and offset that cost."

Of course, using a flammable material comes with its own safety concerns.

Bosque Systems, a water management company, takes a different approach to reducing the amount of water used in fracturing - recycling it.

One barrel 100 times

Three years ago, the company started cleaning the fracturing water that returned to the surface so it can be pumped back into the well, President Clane LaCrosse said.

"Instead of using 100 barrels, you are using one barrel 100 times," LaCrosse said. "There is a sincere desire to make these processes as stable and environmentally friendly as possible."

This makes you wonder about the dream filled projections of the obstructionists for solar and wind power and how likely that they will happen any time soon enough to free us from the grip of oil and gasoline. Seems our writer/blogger missed some very important information on natural gas fuels being cleaner and less costly. If LNG is used as the fuel of choice for gas and diesel fueled engines we really have a chance to free the United States from the economic death grip of big oil and OPEC. Check out Westport Innovations (symbol-WPRT) for a company making a difference in conversion to LNG fuels. JLC pulse

Posted: Aug. 12 2011 by David Kiley on AOL Autoblog
Porsche Cayenne Hybrid

Hybrid vehicles that combine electric battery propulsion with a gasoline powered motor are supposed to be a huge part of the future. So, why did Nissan decide to kill off its Altima hybrid sedan earlier this year? That move came three years after Honda shelved its Accord Hybrid.
The truth is that, despite the success of the Toyota Prius, hybrid technology has been applied badly to several vehicles. Define badly? The system can cost the automaker between $7,000 and $10,000 to install. That cost typically drives up the cost of the vehicle by thousands of dollars to the consumer without much gain at the pump.

Honda, for example, loaded the Accord Hybrid up with the costly technology, and in 2005 managed to get a 29 mpg average fuel economy. But that was later changed to just 25 mpg after Honda added the weight of a sunroof and spare tire. It was the top-priced Accord, and only got 3 miles more per gallon than the gas-powered V6 version, and just one mile more than the perfectly adequate and less expensive four-cylinder Accord that year.

Why do it? Why put these systems into heavy cars, trucks and SUVs when the impact on fuel economy can be so disappointing to the purchaser? The answer is part public relations and marketing, and part obstinance on the part of regulators resistant to making clean diesel more attractive to consumers.

The Volkswagen Touareg, for example, comes with a hybrid system for the princely sticker price of $60,565. The fuel economy is 20 mpg city/24 mpg highway. The clean diesel Touareg TDI starts at $47,950 with a lot of the same features and equipment, and gets 19 mpg city/28 mpg highway, a significant boost over the highway fuel economy of the gas version. It's true that clean diesel is often about 10%-15% costlier than gas, though the Touareg takes premium gas, so the price spread is actually smaller. The TDI is also a much gutsier engine with better performance and driving characteristics than the Hybrid.

Hybrid systems are just not very good at maximizing fuel economy on heavier vehicles and those apt to carry loads of people or cargo. The heavier the vehicle, the less the electric battery can support the load and propulsion of the vehicle.

What does make a lot of sense for trucks and SUVs are stop-start systems that shut down the truck's engine at stop-lights and at idle. The driver just steps on the gas pedal again and the vehicle goes on a dime. It's a terrific way to save gas and emissions. Also, a few pickup trucks, such as the Ram truck from Chrysler, have technology that shuts down half the cylinders in the engine when it is cruising on the highway, boosting fuel economy. That's a system that makes sense.

Advertising and image

Automakers have been convinced that there is a market of vehicle buyers who want to "greenwash" their SUV purchases by buying hybrid versions. The introduction of these vehicles also buys a bit of currency in Washington DC with the politicians and regulators who are given to criticizing automakers for not doing enough to build and promote more fuel efficient vehicles and pushing only gas-thirsty SUVs.

Because "hybrid" seems to still carry a lot of cachet with the public, General Motors is continuing to roll new hybrid vehicles out. And the latest technology, using lithium-ion batteries, shows that GM may have an edge in some ways over Toyota going forward.

Take the 2012 Buick LaCrosse with the new eAssist system. Using a new 2.4-liter, Ecotec 4-cylinder engine on the large sedan, combined with a lithium-ion battery that is regenerated with energy from the vehicle's brakes like most hybrids, the LaCrosse gets an estimated 36 miles per gallon on the highway and 25 mpg in the city. That represents a 20% improvement in highway mileage and a 32% boost in city mileage over the V-6 engine powered LaCrosse from past years.

The MRSP is $29,960 before an $860 destination charge, which is $2,000 more than the 2011 LaCrosse equipped with a 4-cylinder.

This is technology that works nicely in a large car. But the application in pickups and SUVs still doesn't work well given the weight and loads of these kinds of vehicles.

Diesel is the right choice for trucks and SUVs

Clean diesel is widely seen by auto companies and engineers as a more appropriate technology than hybrid systems to gain fuel economy for large sedans, pickups and SUVs. U.S. brands of pickup trucks already employ it. The Ford F Series, Dodge Ram and Chevy Silverado all have Super Duty and Heavy Duty versions with clean diesel engines that are better at towing heavy loads than their versions. Those vehicles get about 25% better fuel economy than the gas versions, and are workhorses, towing up to 24,000 pounds. But automakers like Ford and GM say the cost of the engine and system to makes sure tailpipe emissions meet Federal standards will make its light duty pickups too expensive. If there was a better tax credit for diesel vehicles and a gas tax to make diesel prices more even with that of regular gas, they would sell the light duty diesels in the U.S.

German automakers have reluctantly developed hybrids for cars and crossovers to satisfy public and U.S. governmental pressure to do so. They prefer to sell the clean diesel vehicles, which are quite popular in Europe, where clean diesel fuel is usually cheaper than gasoline because of the high level of taxes levies on gas. The European Union has actually structured the tax policy to favor clean diesel vehicles.

Volkswagen and Audi, both part of VW AG, have electric and hybrid vehicles on the way but they already market six diesels with more on the way. How do they stack up against hybrid cars? The VW Golf gets 34 mpg in combined driving and 42 mpg on highway, compared with 40 mpg combined for the Honda Civic Hybrid, which gets 43 mpg on the highway.

How do I decide which to buy...Hybrid or Diesel?

A big consideration in choosing a car--hybrid or diesel--is if your driving is mostly highway. Diesel is great for people who are in the highway a lot because the fuel economy really climbs on long hauls. If you are in stop-and-go commuting traffic in suburban New York City or Washington DC, a hybrid works better because mileage really climbs in traffic, and you can drive on a battery longer in stop-and-go traffic and at speeds under 45 mph. The Toyota Prius excels in heavy commuter traffic because the driver at slow speeds can stay on battery longer, and the battery gets re-charged frequently through the regenerative braking in the car.

But consumers have figured out that not all hybrids are terribly green, and they are passing them up.

Here are some of the hybrids that are simply not catching on with the pubic, and arguably should not have been built. On the bright-side, that means bargains on vehicles. Dicker hard with dealers.

BMW ActiveHybrid X6

BMW ActiveHybrid X6

MSRP: $88,900
Fuel Economy: 19 mpg highway, 17 mpg city

Why It Seems Pointless: Incredibly, the BMW ActiveHybrid X6 actually gets worse fuel economy than the standard X6. So not only are you being charged $20,000 more for the hybrid version, but you're not even getting what you are supposedly paying for. Sure, the ActiveHybrid has more horsepower, but that's not really why anyone would want to buy a hybrid in the first place.

BWW ActiveHybrid 750

BMW ActiveHybrid 750

MSRP: $102,300 - $106,200
Fuel Economy: 24 mpg highway, 17 mpg city

Why It Seems Pointless: You'd think that $100,000 for a hybrid would net you a little more than a measly 24 mpg on the highway. Considering you can get that exact fuel economy in a non-hybrid Hyundai Equus that contains top-of-the-line luxury amenities for $40,000 less, we can't understand why anyone would ever consider buying this.

Cadillac Escalade Hybrid

Cadillac Escalade Hybrid

MSRP: $74,135 - $88,435
Fuel Economy: 23 mpg highway, 20 mpg city

Why It Seems Pointless: This is one of the biggest SUVs available and, thus, it takes a lot of fuel to get all of that weight moving. When you're dealing with all of this mass, adding a battery is simply not going to make much of a difference. The truth is in the numbers: The hybrid Escalade only sees a 5 mpg improvement on the highway over the standard version and costs about $10,000 more. Would you pay $2,000 per 1 mpg improvement? Didn't think so.

Chevrolet Silverado Hybrid

Chevrolet Silverado Hybrid

MSRP: $38,725 - $48,205
Fuel Economy: 23 mpg highway, 20 mpg city

Why It Seems Pointless: There is a substantial gain here over the regular 4WD Silverado, which, equipped with its 4.3L 6 cylinder engine, gets just 15 mpg combined city and highway driving. But the fact remains that it's starting price is almost $10K more than the gas-powered Silverado Crew-Cab. A clean diesel light-duty truck here would seem to be much more useful.

Chevrolet Tahoe Hybrid

Chevrolet Tahoe Hybrid

MSRP: $51,145
Fuel Economy: 20 mpg city, 23 mpg highway

Why It Seems Pointless: Like the pickup truck, there is a gain in fuel economy over the gas version, which gets 15/21 for a combined 17 mpg. And sure it's about a 20% gain. But it's too pricey and not enough will ever be sold to make any societal dent in smog pollution.

Lexus LS 600h

Lexus LS 600h

MSRP: $112,250
Fuel Economy: 19 mpg city, 23 mpg highway

Why It Seems Pointless: Not only is this car more expensive than the BMW ActiveHybrd 750, it also actually nets a worse combined fuel economy. The BMW is one of the most pointless hybrids, but, incredibly, the $100,000 "green" machine actually makes more sense than this Lexus.

Mercedes-Benz M-Class Hybrid

Mercedes-Benz M-Class Hybrid

MSRP: $55,790
Fuel Economy: 20 mpg city, 24 mpg highway

Why It Seems Pointless: This hybrid SUV actually isn't even the most efficient M-Class that Mercedes offers. The M-Class BlueTEC, which is powered by a 3.0-liter turbo-diesel V6, nets slightly better fuel economy and costs $5,000 less than the hybrid.

Porsche Cayenne Hybrid

Porsche Cayenne Hybrid

MSRP: $67,700
Fuel Economy: 20 mpg city, 24 mpg highway

Why It Seems Pointless: From a cost-to-fuel-economy-improvement standpoint, the Cayenne Hybrid is another vehicle that simply doesn't make sense. The hybrid version of Porsche's performance SUV does get an mpg improvement over the base Cayenne (15 mpg city, 22 mpg highway), but costs about $20,000 more. Considering that over 5 years, you're only going to be saving a little over $2,000 in fuel costs, the cost-benefit ratio doesn't really work in the Cayenne Hybrid's favor. But, oh, how the folks at the country-club will think you are green!

Volkswagen Touareg Hybrid

Volkswagen Touareg Hybrid

MSRP: $60,565
Fuel Economy: 20 mpg city, 24 mpg highway

Why It Seems Pointless: The Touareg Hybrid suffers from the same flaw as the M-Class Hybrid. Volkswagen offers the much more affordable Touareg TDI, which is overall gets much better fuel economy at 19 mpg city, 28 mpg highway. Considering that the Touareg TDI costs about $13,000 less than the hybrid, the sensible option is very clear.

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