Energy Brief: Shell Plans to Boost Growth With Shale Production in U.S., Canada, Argentina


Government Brief

  • Environmental Protection Agency staffers are under orders to complete a replacement for the Obama administration’s Clean Power Plan by the end of 2018, according to sources. The tight timeline, far faster than the normal pace for developing major regulations, would give EPA lawyers the chance to defend the new carbon dioxide emissions regulation during the same term, and the forthcoming rule is said to focus only on emissions from coal plants. (Politico)
  • The EPA will begin collecting greenhouse gas emissions data for 2018 starting in late February, with a hard deadline for all data to be submitted by March 31, according to an agency official. The EPA will also conduct mandatory reporting of greenhouse gases from power plants and other major emitters, according to agency rules finalized in 2009. (Washington Examiner)
  • The Interior Department approved a land swap deal in Alaska, effectively overruling wilderness protections in the Izembek National Wildlife Refuge, that sets in motion a process that would allow a remote Alaskan village to construct a 12-mile gravel road through the refuge. Environmentalists and two Democratic administrations had blocked the road construction and prohibited motorized vehicle access in order to protect various species inhabiting the tundra and lagoons. (The Washington Post)

Business Brief

  • Royal Dutch Shell PLC Chief Executive Ben van Beurden said he was planning for growth in the company’s oil and gas operations by focusing on shale reserves in the United States, Canada and Argentina. The strategy for new production is similar to the approach being taken by the two largest U.S. oil companies — Exxon Mobil Corp. and Chevron Corp. — as they focus on shale reserves in the United States. (Financial Times)
  • Oklahoma natural gas liquids company ONEOK Inc. announced plans to build a $1.4 billion pipeline system from eastern Montana to its central Kansas facilities. ONEOK executives said the company will make a public offering of common stock to help finance the 900-mile Elk Creek Pipeline, expected to transport as many as 240,000 barrels per day of unfractionated natural gas liquids by the end of 2019. (NewsOK)
  • Dominion Energy’s planned merger with SCANA Corp., a South Carolina energy company that operates a network of smaller natural gas transmission pipelines in the state, could open the door for an expansion of Dominion’s proposed Atlantic Coast Pipeline, according to supporters and opponents of the natural gas project. Dominion is reportedly considering an expansion into South Carolina for the project, which is currently slated to run for 600 miles from West Virginia to North Carolina. (The Associated Press)

Chart Review

Events Calendar (All Times Local)

Monday
No events scheduled
Tuesday
House Energy and Commerce subcommittee hearing on DOE modernization 10 a.m.
House Natural Resources subcommittee legislative hearing on bill to create the first national monument managed by tribes 10 a.m.
Woodrow Wilson Center holds discussion on Taiwan energy issues 10 a.m.
NY attorney general holds Clean Power Plan hearing for EPA comments 2:30 p.m.
WCEE’s reception on lessons learned from political appointees in energy and environment 6 p.m.
Sustainable Transport Award Ceremony 2018 6 p.m.
Wednesday
World Resources Institute hosts event on environment and international development stories to watch in 2018 8:30 a.m.
House Natural Resources Committee marks up six bills 10 a.m.
Senate Environment and Public Works Committee hearing on national water infrastructure 10 a.m.
Thursday
EPA webinar on applying for a P3 grant 2 p.m.
CSIS discussion with former Energy Secretary Ernest Moniz 4 p.m.
Friday
No events scheduled

2017 Brands in Review

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General

Interior Department strikes land swap deal with Alaskan village for road through national wildlife refuge
Juliet Eilperin, The Washington Post

The Interior Department has approved a land swap deal that will allow a remote Alaskan village to construct a road through the Izembek National Wildlife Refuge, according to local officials. Environmentalists, along with two Democratic administrations, have blocked the road on the grounds that it would bisect a stretch of tundra and lagoons that provide a vital feeding ground for migrating birds as well as habitat for bears, caribou and other species.

Superfund work touted by Trump EPA was completed years ago
Michael Biesecker and Jason Dearen, The Associated Press

The Environmental Protection Agency is touting cleanups at seven of the nation’s most polluted places as a signature accomplishment in the Trump administration’s effort to reduce the number of Superfund sites, even though records show the physical work was completed before President Donald Trump took office. The agency earlier this week credited the leadership of EPA Administrator Scott Pruitt with tripling the number of sites fully or partially removed from the Superfund’s National Priorities List in 2017, compared with the two sites taken off in the Obama administration’s last year.

Can’t please everyone: Trump energy policy riles competing sectors
Timothy Gardner, Reuters

When the administration of U.S. President Donald Trump proposed new subsidies for coal and nuclear plants, it seemed like an obvious way to deliver on campaign promises to boost the nation’s energy industry. Squabbling over the proposal exemplifies the administration’s larger struggle to deliver on promises of a sweeping “energy renaissance” across the coal, oil, gas and nuclear industries.

Oil stable on lower U.S. rig count, but below recent highs
Henning Gloystein, Reuters

Oil prices were stable on Monday, supported by a slight decline in the number of U.S. rigs drilling for new production, with crude holding just below near three-year highs reached last week. U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $61.50 a barrel at 0800 GMT, 6 cents above their last settlement.

Oil and Natural Gas

Shell looks to shale production for rapid growth
Ed Crooks, Financial Times

The growth of Royal Dutch Shell’s oil and gas operations in the next decade will depend on shale production, its chief executive has said, in the latest sign of western energy groups pinning their hopes for expansion on those “unconventional” resources. Depending on how oil prices looked in the 2020s, he said, the company would probably want to keep investing in shale “because we will really want to grow this business quite quickly”.

ONEOK Inc. to build $1.4 billion natural gas pipeline system
Adam Wilmoth, NewsOK

ONEOK Inc. on Thursday announced plans to build a $1.4 billion pipeline system to move natural gas liquids from eastern Montana to the Tulsa company’s existing facilities near Bushton, Kansas. The 900-mile Elk Creek Pipeline is expected operational by the end of 2019 and is designed to transport up to 240,000 barrels per day of unfractionated natural gas liquids.

Dominion-SCANA merger could mean pipeline expansion
Sarah Rankin, The Associated Press

Dominion Energy’s planned merger with a South Carolina energy company could open the door for an expansion of the proposed Atlantic Coast Pipeline, both supporters and opponents of the natural gas project say. In a conference call about the proposed merger, Dominion CEO Tom Farrell said SCANA Corp. is a “natural fit” for Dominion, which already operates a network of smaller natural gas transmission pipelines in South Carolina.

Collision Near China Leaves Iranian Oil Tanker in Flames
Austin Ramzy, The New York Times

Rescuers were searching Monday for crewmen missing from an Iranian oil tanker that had collided with another ship off China’s coast, leaving the tanker in flames and at risk of exploding and sinking, the Chinese authorities said. The Panamanian-flagged tanker, the Sanchi, collided with the CF Crystal, a Hong Kong-registered bulk freighter, around 8 p.m. Saturday about 160 nautical miles east of Shanghai.

TP ICAP buys U.S. energy and commodities broker SCS
Noor Zainab Hussain, Reuters

TP ICAP Plc, the world’s largest interdealer broker, said it had bought SCS Commodities Corp, a U.S. energy and commodities broker for an undisclosed sum. TP ICAP, which brings together buyers and sellers in financial, energy and commodities markets, said SCS dealt with crude oil futures, soft commodities, petroleum and refined products, natural gas options and crude oil options.

Wyoming Supreme Court weighs competing rights of oil and gas and coal leases
Heather Richards, The Casper Star-Tribune

The Wyoming Supreme Court threw up its hands Thursday in a contested case between a coal company and an oil and gas firm over the right to mine. Peabody Energy, the largest coal producer in Wyoming, and Berenergy, a private, Denver-based oil company, each argue that they have superior rights to mine coal and drill for oil and gas, on the same patch of Wyoming.

Trump has big plans for offshore oil development. But will it ever happen?
Keith Schneider, The Los Angeles Times

With characteristic flamboyance, the Trump administration has set in motion a grand scheme to lure energy companies to explore for oil and gas across virtually all of America’s outer continental shelf, a deep marine domain encompassing billions of acres of ocean bottom. Drawing a distinction from the Obama administration’s concerns about climate change and restricting offshore fossil energy development, Interior Secretary Ryan Zinke cast President Trump’s offshore drilling campaign as a study in American strength.

Alaska may open up again for oil leasing, but risks linger
The Associated Press

Alaska Gov. Bill Walker, an independent facing re-election this year, embraced Interior Secretary Ryan Zinke’s proposed 19 lease sales in the state, including six in the potentially oil rich but environmentally sensitive Arctic Ocean waters. But the big question is whether oil companies will commit the substantial resources it would take to invest in a frontier area where the cost of drilling is extremely high compared with other regions — and simultaneously face the wrath of environmental groups fiercely opposed to Arctic offshore drilling.

Energy pioneer tries to surf the natural-gas wave
Amy Harder, Axios

America’s natural gas industry is riding a political and economic wave it hopes can go all over the world. Why we can learn from him: Souki, founder of Tellurian Inc., a new Houston-based natural-gas company, is considered a pioneer among his peers and embodies much of the sector’s ebbs and flows.

U.S. oilfield service firms dust off IPO plans as crude prices surge
Liz Hampton, Reuters

U.S. oilfield service companies are gearing up for initial public offerings, according to regulatory filings and analysts, after several shelved equity sales last year during a weak period for oil prices. Energy executives surveyed last month said they would increase drilling sharply at prices above $60 a barrel.

Utilities and Infrastructure

Dominion Energy OK with repealing law that funded S.C.’s nuclear failure — for future projects
Thad Moore, The Post and Courier

Dominion Energy says it has no problem with South Carolina lawmakers repealing the controversial law that financed the state’s costly nuclear power plant failure — as long as it only applies to future projects. The law allows power companies to charge their customers for large power plants while they’re under construction, even if they never produce a zap of electricity.

Departed SCANA executives won’t get golden parachutes after nuclear project’s collapse
Avery G. Wilks, The State

SCANA will not offer a golden parachute to two executives who retired last year after the company’s $9 billion nuclear construction project went belly up. Former chief executive Kevin Marsh and chief operating officer Steve Byrne also are not eligible for change-in-control payments, potentially worth millions of dollars, that could be triggered if the Cayce-based company finalizes its sale to Dominion Energy of Virginia.

Renewables

Shell sells stake in Dutch wind farm to Switzerland’s Partners Group
Toby Sterling, Reuters

Swiss investor Partners Group Holding AG said on Monday it had taken a 45 percent stake in a 700 megawatt (MW) offshore wind project in the Netherlands, buying partial stakes from Shell, Mitsubishi and Eneco. Project leader Shell, which last month put together a 13-bank consortium to provide 1 billion euros in funding to build it, cut its stake to 20 percent from 40 percent.

Coal

Pennsylvania Coal Mine To Close
NPR News

It was announced this past week that a coal mine – the 4 West Mine – in southwestern Pennsylvania will close. NPR’s Lulu Garcia-Navarro talks to county supervisor Blair Zimmerman about what this means for his community.

UK to end 140 years of coal power by 2025
Jillian Ambrose, The Telegraph

Britain will end its use of coal in power plants by 2025 after more than 140 years burning the fossil fuel. The Government confirmed that its 2015 pledge to phase out coal-fired power within a decade would move ahead under a new rule that limits the ‘carbon-intensity’ of power plants.

Coal dwarfs battery metals in mining deals despite war on pollution
Clara Denina and Barbara Lewis, Reuters

Coal and iron ore dominated mining takeovers in 2017, Thomson Reuters data shows, with buyers favoring the heavily polluting devil they know over the uncertainties of a battery-powered future. While the biggest deal was in Brazil, China was a top player despite planning to reduce domestic coal and steel-making to tackle smog in its cities.

Nuclear

Failed nuclear project expected to dominate upcoming S.C. legislative session
Andy Shain and Seanna Adcox, The Post and Courier

The main question as the South Carolina General Assembly convenes Tuesday is how many other issues will lawmakers tackle outside of fixes for the Fairfield County nuclear plant debacle. The $9 billion fiasco is expected to dominate the 2018 session with legislators considering everything from cutting off customer payments for the unfinished reactors to selling state-owned power provider Santee Cooper.

‘Unusual Event’ declared at Oyster Creek
Erik Larsen, Asbury Park Press

Operators at the Oyster Creek nuclear power plant reduced its power after declaring an “Unusual Event” Saturday morning, when low tides and high winds impacted the water levels in its intake canal, according to a company spokeswoman. “An Unusual Event is the lowest of four emergency classifications established by the U.S. Nuclear Regulatory Commission,” said Suzanne D’Ambrosio, a spokeswoman for the Oyster Creek Generating Station, in a prepared statement.

Climate

EPA moving quickly to write new climate rule in 2018
Emily Holden, Politico

Environmental Protection Agency staffers are under orders from the Trump administration to complete a replacement for former President Barack Obama’s major climate change rule by the end of the year, far faster than the normal pace the agency uses to develop major regulations, according to three sources familiar with the process. That short time frame would give EPA lawyers the chance to defend the regulation from the legal challenges it is certain to face during President Donald Trump’s current term.

Trump’s EPA says it will count carbon emissions as polar freeze drives up coal use
John Siciliano, Washington Examiner

The Trump administration will begin collecting greenhouse gas emissions data for 2018 early next month, as coal-fired power plants that are keeping the heaters humming during the deep freeze likely will mean an increase in this year’s carbon dioxide output. The Environmental Protection Agency houses the greenhouse gas reporting program, which collects data from power plants and all other major emitters of carbon dioxide.

Opinions, Editorials and Perspectives

Federal energy proposal will hike consumer costs in freezing winter
Charles Hernick, The Hill

Winter is here in full force, bringing subfreezing temperatures and costly heating bills to a large portion of the country. Unfortunately, the U.S. Department of Energy filed a proposal with the Federal Energy Regulatory Commission (FERC) in September that could raise energy prices for 65 million Americans.

Trump’s offshore oil drilling plans ignore the lessons of BP Deepwater Horizon
Donald Boesch, University of Maryland Center for Environmental Science

The Trump Administration is proposing to ease regulations that were adopted to make offshore oil and gas drilling operations safer after the 2010 Deepwater Horizon disaster. I served on the bipartisan National Commission that investigated the causes of this epic blowout.

The Marrakesh Climate Express
Editorial board, The Wall Street Journal

Washington Gov. Jay Inslee signed an executive order in 2016 on telecommuting, noting that letting public employees work remotely can “reduce transportation-related greenhouse-gas emissions.” And those emissions do add up, especially if you commute from Morocco to Washington—as the Governor’s senior climate policy adviser, Chris Davis, has done since August.

Coal subsidies are bad for Texas’ economy
Elizabeth Lippincott, The Monitor

In Texas, several utilities have announced plans to deploy more electric power from renewable energy regardless of changes in federal regulations. Ill-conceived policies, like coal subsidies or taxpayer bailouts for coal plants, would distort the U.S. energy market and interfere with the well-functioning Texas electric market, delaying or derailing the Lone Star State’s market-driven transition to clean energy.

The energy reliability crisis that wasn’t
Dena E. Wiggins, The Hill

This is exactly what coal and nuclear industry executives warned us about in these pages yesterday: A severe weather system that they claim will bring our “fragile” energy grid crashing to the ground. The only problem is … things are fine.

Research Reports

Climate Warming as a Possible Trigger of Keystone Mussel Population Decline in Oligotrophic Rivers at the Continental Scale
Ivan N. Bolotov et al., Scientific Reports

The effects of climate change on oligotrophic rivers and their communities are almost unknown, albeit these ecosystems are the primary habitat of the critically endangered freshwater pearl mussel and its host fishes, salmonids. The distribution and abundance of pearl mussels have drastically decreased throughout Europe over the last century, particularly within the southern part of the range, but causes of this wide-scale extinction process are unclear.

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