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Fri, 2013-12-20 09:45Steve Horn
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Dollarocracy: U.S. Congressmen Refuse to Address Keystone XL Southern Half Spill Concerns

What's the U.S. congressional response to the safety issues with the 485-mile southern half of TransCanada's Keystone XL pipeline raised by Public Citizen's Texas office? Mostly what Simon & Garfunkel called “The Sound of Silence” in their famous song.

DeSmogBlog contacted more than three dozen members of the U.S. Congress representing both political parties to get their take on Public Citizen's alarming findings in its November investigation (including dents, metal that had to be patched up and pipeline segments labeled “junk”), but got little in the way of substantive responses.

Set to open for business on January 22approved via an Executive Order by President Barack Obama in March 2012 and rebranded the “Gulf Coast Pipeline Project” by TransCanada, the southern half of the pipeline has garnered far less media coverage than its U.S.-Canada border-crossing brother to the north, Keystone XL's northern half.

Over two dozen members of the U.S. House of Representatives wrote a letter to President Obama on December 12 expressing concern over the conflicts-of-interest in the U.S. State Department's environmental review process for the northern half of the line.

But none of them would comment on concerns with the southern half of the line raised in the Public Citizen report after multiple queries via e-mail from DeSmogBlog.

Wed, 2013-12-18 12:00Steve Horn
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Keystone XL Fork in the Road: TransCanada's Houston Lateral Pipeline

Only Barack Obama knows the fate of the northern half of TransCanada's Keystone XL tar sands pipeline.  But in the meantime, TransCanada is preparing the southern half of the line to open for commercial operations on January 22.

And there's a fork in that half of the pipeline that's largely flown under the radar: TransCanada's Houston Lateral Pipeline, which serves as a literal fork in the road of the southern half of Keystone XL's route to Gulf Coast refineries.

Rebranded the “Gulf Coast Pipeline” by TransCanada, the 485-mile southern half of Keystone XL brings a blend of Alberta's tar sands crude, along with oil obtained via hydraulic fracturing (“fracking”) from North Dakota's Bakken Shale basin, to refineries in Port Arthur, Texas. This area has been coined a “sacrifice zone” by investigative journalist Ted Genoways, describing the impacts on local communities as the tar sands crude is refined mainly for export markets.

But not all tar sands and fracked oil roads lead to Port Arthur. That's where the Houston Lateral comes into play. A pipeline oriented westward from Liberty County, TX rather than eastward to Port Arthur, Houston Lateral ushers crude oil to Houston's refinery row

“The 48-mile (77-kilometre) Houston Lateral Project is an additional project under development to transport oil to refineries in the Houston, TX marketplace,” TransCanada's website explains. “Upon completion, the Gulf Coast Project and the Houston Lateral Project will become an integrated component of the Keystone Pipeline System.”

Mon, 2013-12-16 10:07Steve Horn
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New "Frackademia" Report Co-Written by "Converted Climate Skeptic" Richard Muller

The conservative UK-based Centre for Policy Studies recently published a study on the climate change impacts of hydraulic fracturing (“fracking”) for shale gas. The skinny: it's yet another case study of “frackademia,” and the co-authors have a financial stake in the upstart Chinese fracking industry.

Titled “Why Every Serious Environmentalist Should Favour Fracking“ and co-authored by Richard Muller and his daughter Elizabeth “Liz” Muller, it concludes that fracking's climate change impacts are benign, dismissing many scientific studies coming to contrary conclusions.

In an interview with DeSmogBlog, Richard Muller — a self-proclaimed “converted skeptic” on climate change — said he and Liz had originally thought of putting together this study “about two years ago.”

“We quickly realized that natural gas could be a very big player,” he said. “The reasons had to do with China and the goal of the paper is to get the environmentalists to recognize that they need to support responsible fracking.

The ongoing debate over fracking in the UK served as the impetus behind the Centre for Policy Studies — a non-profit co-founded by former right-wing British Prime Minister Margaret Thatcher in 1974 — hosting this report on its website, according to Richard Muller.

“They asked for it because some environmentalists are currently opposing fracking in the UK, and they wanted us to share our perspective that fracking is not only essential for human health but its support can be justified for humanitarian purposes,” he said. 

This isn't the first time Liz Muller has unapologetically sung the praises of fracking and promoted bringing the practice to China. In April, she penned an op-ed in The New York Times titled, “China Must Exploit Its Shale Gas.” 

Fri, 2013-12-13 07:00Steve Horn
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Former Chesapeake Energy CEO Aubrey McClendon Buys Fracking Wells In Ohio's Utica Shale

Former Chesapeake Energy CEO and Founder Aubrey McClendon is back in the hydraulic fracturing (“fracking”) game in Ohio's Utica Shale in a big way, receiving a permit to frack five wells from the Ohio Department of Natural Resources on November 26. 

“The Ohio Department of Natural Resources awarded McClendon's new company, American Energy Utica LLC, five horizontal well permits Nov. 26 that allows oil and gas exploration on the Jones property in Nottingham Township, Harrison County,” a December 6 article appearing in The Business Journal explained. “In October, American Energy Utica announced it has raised $1.7 billion in capital to secure new leases in the Utica shale play.”

McClendon is the former CEO of fracking giant Chesapeake Energy and now the owner of American Energy Partners, whose office is located less than a mile away from Chesapeake's corporate headquarters.

The $1.7 billion McClendon has received in capital investments for the purchase of 110,000 acres worth of Utica Shale land came from the Energy & Minerals GroupFirst Reserve Corporation, BlackRock Inc. and Magnetar Capital.

McClendon — a central figure in Gregory Zuckerman's recent book “The Frackers” — is currently under investigation by the U.S. Securities and Exchange CommissionHe left Chesapeake in January 2013 following a shareholder revolt over his controversial business practices.

In departing, he was given a $35 million severance package, access to the company's private jets through 2016 and a 2.5% stake in every well Chesapeake fracks through June 2014 as part of the Founder's Well Participation Program.

Little discussed beyond the business press, McClendon has teamed up with a prominent business partner for his new start-up: former ExxonMobil CEO Lee Raymond.

Thu, 2013-12-12 14:45Steve Horn
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Federal Pipeline Safety Agency Approves Startup of Keystone XL Southern Half

DeSmogBlog has learned that TransCanada cleared the final hurdle for the southern half of its Keystone XL tar sands pipeline, receiving a green light last week from the Pipeline and Hazardous Materials Safety Administration (PHMSA) following a review of several safety concerns.

TransCanada announced this week that it has begun injecting oil into the southern half of its Keystone XL pipeline in preparation for commercial operations.  

Leading up to PHMSA giving Keystone XL south the go-ahead to start up, Public Citizen raised several questions about the safety of the pipeline. 

Will TransCanada respond to greivances raised about dents, faulty welding, pipeline material designated “junk” and other issues raised in the consumer advocacy group's November investigation? And what about September 10 and September 26 warning letters obtained by Public Citizen raising similar concerns from PHMSA to TransCanada?

Both TransCanada and PHMSA have provided DeSmogBlog answers to these questions.

Rebranded the “Gulf Coast Pipeline Project” by TransCanada, the 485-mile Cushing, Oklahoma to Port Arthur, Texas Keystone XL southern half — approved via a March 2012 Executive Order from President Barack Obama — is set to open for business by mid- to late-January.

Tue, 2013-12-10 12:01Steve Horn
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TransCanada Begins Injecting Oil Into Keystone XL Southern Half; Exact Start Date A Mystery

Keystone XL's southern half is one step closer to opening for business. TransCanada announced that “on Saturday, December 7, 2013, the company began to inject oil into the Gulf Coast Project pipeline as it moves closer to the start of commercial service.”

The Sierra Club's legal challenge to stop the pipeline was recently denied by the U.S. Court of Appeals for the Tenth Circuit, so the southern half, battled over for years between the industry and environmentalists, will soon become a reality.

According to a statement provided to DeSmog by TransCanada, “Over the coming weeks, TransCanada will inject about three million of [sic] barrels of oil into the system, beginning in Cushing, Oklahoma and moving down to the company’s facilities in the Houston refining area.”

In mid-January, up to 700,000 barrels per day of Alberta's tar sands diluted bitumen (dilbit) could begin flowing through the 485-mile southern half of TransCanada's pipeline, known as the Gulf Coast Project. Running from Cushing, Oklahoma to Port Arthur, Texas, the southern half of the pipeline was approved by both a U.S. Army Corps of Engineers Nationwide Permit 12 and an Executive Order from President Barack Obama in March 2012.

BloombergThe Canadian Press and The Oklahoman each reported that the Gulf Coast Project pipeline is now being injected with oil. Line fill is the last key step before a pipeline can begin operations. 

“There are many moving parts to this process – completion of construction, testing, regulatory approvals, line fill and then the transition to operations,” TransCanada spokesman Shawn Howard told DeSmog. “Line fill has to take place first, then once final testing and certifications are completed, the line can then go into commercial service.”

Residents living along the length of the southern half will have no clue about the rest of the start-up process, as TransCanada says it won't provide any more information until the line is already running. “For commercial and contractual reasons, the next update we will provide will be after the line has gone into commercial service,” the company announced.

When DeSmog asked whether the company is currently injecting conventional oil or diluted bitumen sourced from the Canadian tar sands, TransCanada's Howard replied: 

“Many people like to try and categorize the blend, etc., however we are injecting oil into the pipeline. As you’ve likely seen me quoted before, oil is oil and this pipeline is designed to handle both light and heavy blends of oil, in accordance with all U.S. regulatory standards.

I am not able to provide you the specific blend or breakdown as we are not permitted (by our customers) from disclosing that information to the media. There are very strict confidentiality clauses in the commercial contracts we enter into with our customers, and that precludes us from providing that. The reason is that if we are providing information about a specific blend, when it is in our system, etc. – that has the potential to identify who our customers may be or allow others to take financial positions in the market and profit from that information when others do not have access to the same information. This has much farther reaching impacts for the financial markets (and ultimately all of us).”

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