Natural Gas Industry

Fri, 2012-08-03 05:00Steve Horn
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Delaware Tax Haven: The Other Shale Gas Industry Loophole

Most people think of downtown Houston, Texas as ground zero for the oil and gas industry. Houston, after all, serves as home base for corporate headquarters of oil and gas giants, including the likes of BP America, ConocoPhillips, and Shell Oil Company, to name a few.

Comparably speaking, few would think of Wilmington, Delaware in a similar vein. But perhaps they should, according to a recent New York Times investigative report by Leslie Wayne.

Wayne's story revealed that Delaware serves as what journalist Nicholas Shaxson calls a “Treasure Island” in his recent book by that namesake. It's an “onshore tax haven” and an even more robust one than the Caymen Islands, to boot.

The Delaware “Island” is heavily utilized by oil and gas majors, all of which are part of the “two-thirds of the Fortune 500” corporations parking their money in The First State.

Delaware is an outlier in the way it does business,” David Brunori, a professor at George Washington Law School told The Times. “What it offers is an opportunity to game the system and do it legally.”

The numbers are astounding. “Over the last decade, the Delaware loophole has enabled corporations to reduce the taxes paid to other states by an estimated $9.5 billion,” Wayne wrote

“More than 900,000 business entities choose Delaware as a location to incorporate,” explained another report. “The number…exceeds Delaware's human population of 850,000.”

Thu, 2011-12-01 14:43Steve Horn
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LNG Groundhog Day: Cheniere Energy Signs Yet Another Gas Export Deal on Gulf Coast

Credit: Oleksandr Kalinichenko / Shutterstock

Another day, another unconventional gas export deal signed. Nascent North American LNG (liquefied natural gas) export deals are happening so fast and furiously that it is hard to keep track of them all.

The latest: On November 21, Cheniere Energy Partners signed a 20-year LNG export deal with Gas Natural Fenosa, an energy company which operates primarily in Spain but also in such countries as Italy, Mexico, Colombia, Argentina, and Morocco. Cheniere will maintain the Sabine Pass LNG export terminal located off of Sabine Lake between Texas and Louisiana, which feeds into the Gulf of Mexico, while Gas Natural Fenosa will ship the gas to the global market.

Cheniere, which made waves when its CEO Charif Souki announced that his corporation's business model would center exclusively around LNG export terminals, also recently signed a 20-year export deal with BG Group, short for British Gas Group.

Like the recent export deal with BG Group, which involves carrying fracked unconventional gas from various shale basins around the United States via pipelines to the Sabine Pass LNG export terminal, the Gas Natural Fenosa deal also centers around the export of gas from Sabine Pass to the global market.

Mon, 2011-11-28 17:39Laurel Whitney
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Are New York Lawmakers Poised To Throw Upstate Residents Under The Fracking Bus?

Despite last week’s temporary win protecting the Delaware River Basin and its inhabitants from natural gas fracking, the debate rages on in New York State. Lawmakers, industry lobbyists and concerned landowners have debated for over a year about whether or not to open up the state to the Marcellus Shale fracking bonanza.

New York Governor Andrew Cuomo’s stated commitment to vote no in the Delaware River Basin vote was promising, but it is offset by the fact that he has assembled a secretive 18-person “fracking panel” which Food & Water Watch executive director Wenonah Hauter recently alleged is comprised of many “strongly self-interested and industry-biased” individuals. Some environmental groups are concerned that this panel seems rigged to give the green light to fracking in New York.



At previous public hearings, tensions have already run high with both supporters and opponents lining up hours beforehand to ensure their turn to speak out on this highly contentious issue.



Most of the proponents of gas fracking continue to argue the economic mantra of job creation and domestic energy security, even though multiple reviews have debunked the gas industry’s lofty job projections. Food & Water Watch released a report indicating that many of the jobs created would likely be short-term and favor contract workers from outside the state. Other watchdogs of industry rhetoric, including Senator Ron Wyden (D-OR), point out that the industry's rush to export gas from the fracking boom will lead to much higher gas prices for Americans, contradicting the industry's alleged commitment to domestic energy security.

There are also important questions about just how much gas there is underneath New York to warrant such extreme energy development.  After a recalculation of the resource potential of the area, geologists at the U.S. Geological Survey dropped their estimate of the recoverable gas by a quarter. They determined that the amount of reasonably recoverable gas would only meet US demand for four years instead of sixteen.

Tue, 2011-09-06 16:39Carol Linnitt
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New West Partnership Includes CAPP Lobbyists in Fracking Policy Development

The British Columbia Ministry of Energy was designated a “lead agency” in a backroom collaboration with Alberta and Saskatchewan to address water concerns for the province’s rapidly expanding shale gas industry. The New West Partnership, an undisclosed collaboration between Canada's three western provinces to expedite shale gas extraction, has held four secret meetings since July 2011 to discuss water issues related to fracking, according to a leaked briefing note, released today by the BC Tap Water Alliance (BCTWA).

The leaked document, including an attached directive, outlines the group’s strategies to streamline gas production across the West while minimizing public and stakeholder involvement. The partnership project, which is aimed to design streamlined policy regarding gas extraction including the controversial technique fracking, is also posed to curtail public concern with “proactive” public relations campaigns that will respond to the “ill-informed campaigns” of environmental NGOs, public media and local communities. 

The Project Charter outlines the New West Partnership’s intentions to manage public opinion with ‘consistent messages’ regarding environmental concerns which are “potentially problematic” for shale gas development. Despite the group’s pretense to stakeholder transparency and “enhanced communication,” the only external body consulted so far is Canada’s largest oil and gas lobby, the Canadian Association of Petroleum Producers (CAPP). According to the BCTWA press release, the internal meetings held by provincial regulators and government officials included three unregistered lobbyists representing CAPP, prompting a complaint from the Alberta Federation of Labour.  
Mon, 2011-03-21 13:30Carol Linnitt
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Gas Industry Working Overtime to Smother Revived FRAC Act Efforts To Rein In Hydraulic Fracturing

Last week, US Senators Robert Casey (D-PA) and Frank Lautenberg (D-NJ) reintroduced legislation to the Senate that would close the oversight gap that the gas industry has taken full advantage of since 2005. The “Fracturing Responsibility and Awareness of Chemicals Act,” commonly known as the FRAC Act, would close the Halliburton Loophole in Dick Cheney’s infamous 2005 Energy Policy Act, which exempted hydraulic fracturing from the auspices of the Safe Drinking Water Act (SDWA).

Hydraulic fracturing is used in 90% of all unconventional natural gas wells in the U.S. and involves the injection of millions of gallons of water, sand and dangerous chemicals into the ground. The bill would also require that the natural gas industry publicly disclose the chemicals they use to drill for unconventional gas. These chemicals, including potent cancer-causing agents, are protected as industry trade secrets.

The FRAC Act was originally introduced as a set of twin bills to the House and Senate in 2009 but died in the last session of Congress. According to new supporter Senator Frank Lautenberg, the FRAC Act will give the EPA the necessary backing to, at the very least, properly investigate and assess the risks associated with hydraulic fracturing.

The industry’s aggressive lobbying campaign against the FRAC Act is part of a larger agenda to limit federal oversight of gas drilling. The legal void created by the Energy Policy Act in 2005 essentially crippled the Environmental Protection Agency’s (EPA) ability to properly monitor the boom in gas fracking activity, especially the potentially serious threat to drinking water supplies. A long history of industry pressure on EPA scientists is also present on this issue, leading to the narrowing of scope in the EPA’s investigations and the elimination of critical findings when it comes to certain fracking threats.

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