Chevron: Safety oversights, poor record keeping contributed to massive Richmond refinery blaze

Story originally appeared on Contra Costa Times.

RICHMOND -- In an 80-page report released Friday on its own investigation into last summer's massive refinery fire, Chevron U.S.A. Inc. acknowledged its failure to identify and replace a corroded pipe and vowed to take steps to prevent a similar accident from happening again.

The oil giant also acknowledged that it mishandled its response to the pipe leak that sparked the blaze.

The report, submitted to the Contra Costa Health Services department and released to the media Friday morning, arrived at many of the same general findings as the U.S. Chemical Safety Board, one of the agencies investigating the Aug. 6 fire that sent more than 15,000 people to area hospitals and shut down the heart of the refinery for months.

The safety board said in a public meeting April 5 that Chevron missed multiple opportunities to replace the pipe blamed for the blaze.

Chevron's own investigation revealed four "causal factors" that triggered the fire, which injured several workers and sent more than 15,000 people to area hospitals. The four factors were:

Once a pipe leak was discovered, workers did not "recognize the risk of piping rupture and the possibility of auto-ignition." As a result, workers may have worsened the leak by removing the aluminum weather jacketing from the pipe and using firefighting equipment to remove the pipe insulation.

A 2002 discovery of significant thinning to the pipe that later ruptured was buried in a software database, limiting the "ability for future decision makers to utilize the data."

Inspectors failed to grasp the importance of inspecting carbon steel components vulnerable to corrosion.

A 2011 component inspection was incomplete, passing over the pipe that ruptured a year later. The inspection could have alerted officials that the pipe had thinned to unsafe levels.

Political leaders said the report was further evidence that the fire should trigger big changes at the refinery and within the refining industry.

"Chevron's report underscores the need to conduct a full independent safety culture audit of the refinery as ordered by the county's Health Department last week," county Supervisor John Gioia, of Richmond, wrote in an email Friday. "It is clear that the refinery's process safety culture and decision-making procedures about equipment replacement need to be thoroughly reviewed."

Chevron officials hailed the report as a cause for refinery safety improvement.

"Our report concludes that the causes of the incident were multifaceted," Chevron said on its company Facebook page. "The refinery's management and our entire work force are implementing a comprehensive set of actions, not simply to address the issues underlying the August incident, but also as part of our commitment to continuous improvement."

In the report, Chevron emphasized what it described as numerous improvements in safety procedures and comprehensive component screenings to ensure that another incident does not occur.

Chevron has inspected every piping component "potentially susceptible to sulfidation corrosion," according to the report, a total of 4,600 pipes and pipe components in the massive refinery. Inspectors found four pipes that required replacement, according to the report.

Moving forward, the refinery will adhere to a new policy of inspecting 100 percent of piping components during inspections, rather than just selective screenings.

The Chevron report also suggested the refinery, which has long guarded technology secrets and prohibits visitors from taking photographs while on the property, will open up to more peer review and outside technical experts to get additional opinions on safety procedures and component quality.

The Chemical Safety Board is expected to go even further in its recommendations next week. CSB officials have said that regulators and outside experts need more access to refineries and must play a greater role in ensuring that safety procedures are followed and new science is incorporated into those standards.

The Aug. 6 fire shut down the No. 4 crude unit until last week, when the state Division of Occupational Safety and Health (Cal/OSHA) gave Chevron the green light to restart operations. Chevron anticipates resuming production in the unit by the end of June.

Friday's report comes ahead of a highly anticipated unveiling of the Chemical Safety Board's investigation findings and safety recommendations, scheduled for Monday. A community meeting on the findings is scheduled for 6:30 p.m. April 19 at the Richmond Civic Center.

Cal/OSHA issued more than 25 violations stemming from the fire and slapped the energy giant with more than $900,000 in fines, the biggest in the agency's history.

"As early as 2002 ... the Richmond refinery could have taken timely action to replace the piping that failed on Aug. 6," said Dan Tillema, the Chemical Safety Board's lead chemical incident investigator, during a public hearing April 5. "However, Chevron failed to do so."

BP calls first witness at trial over Gulf spill

Story originally appeared on USA Today.

NEW ORLEANS (AP) — BP's first witness at a trial over the deadly Deepwater Horizon disaster testified Monday that the company safely drilled its Macondo well in the Gulf of Mexico before a series of mistakes led to an April 2010 blowout, which triggered the nation's worst offshore oil spill.

Retired LSU petroleum engineering professor Adam "Ted" Bourgoyne Jr., an expert in drilling operations, said crew members and BP supervisors on the rig followed "normal industry practices" before encountering problems as they tried to plug the well.

"I think the well was drilled safely, basically because standard industry practices were followed. There were no major problems that weren't properly handled," he said. "I even noted that they were taking extreme care to follow all the safety procedures with respect to reporting little minor things that happened, like washers falling out of derricks."

Bourgoyne said he disagreed with many conclusions of Alan Huffman, an expert witness for the federal government who testified earlier in the trial. Huffman accused BP of deviating from industry standards and continuing to drill despite clear signs of trouble.

Huffman concluded that BP repeatedly failed to drill with a "safe drilling margin," which he defined as the cushion between the well's mud weight and its fracture gradient. The mud weight must be kept heavy enough to keep fluids from flowing up the well without fracturing the formation that is being drilled.

"One of the things that Dr. Huffman suggested was that the way that the drilling margin was managed presented dangers, extreme danger to the men and women onboard the Deepwater Horizon. Do you agree with that?" BP attorney Mike Brock asked Bourgoyne.

"No, I don't agree with that at all," he responded.

Bourgoyne said he believed the drilling margin allegations had no connection to the blowout.

He also disagreed with Huffman's claims that BP repeatedly misrepresented the well's pressure integrity test results and gave federal regulators a "very false impression" of what was happening during the drilling operation.

"Did your review indicate that BP conducted an appropriate pressure integrity test at each interval where it should be conducted?" Brock asked.

"Yes, they did," Bourgoyne said.

Bourgoyne joined many other experts and government investigations in concluding that crew members failed to properly monitor the well and rig supervisors misinterpreted a key safety test just before the blowout.

"They called it a pass when it was a fail," he said of the test. "It was surprising that they called it a pass. I think the data was clearly there."

Two BP well site leaders, Robert Kaluza and Donald Vidrine, are charged with manslaughter in the deaths of 11 rig workers and await a separate trial. Their indictment accuses them of misinterpreting the same test.

Bourgoyne said the BP supervisors and crew members employed by rig owner Transocean Ltd. discussed the test results "as a group" and ultimately "bought into" an alternate explanation for abnormal drill pipe pressure.

"This is very surprising to me, but it happened. And I think it was a group decision," he said. "They had a lot of confidence in one another, and once they made the decision, they were convinced they were right."

Plaintiffs' attorney Jim Roy asked Bourgoyne if a "moron" ought to know whether the test is a success based on the pressure readings.

"No comment?" Roy asked.

"No comment," replied Bourgoyne, who later added, "I think, in general, this crew was competent and had the appropriate training. Why they made this mistake, you can't explain it."

Bourgoyne said the blowout could have been averted if the test had been properly interpreted, but he identified "a lot of contributing causes to this disaster."

"It takes a whole series of failures to line up for something like that to happen," he said.

U.S. District Judge Carl Barbier is hearing testimony without a jury. Barring a settlement, he could decide how much more money BP and its contractors owe for their roles in the catastrophe.

The first phase of the trial, which has entered its seventh week, is designed to identify causes of the blowout and assign fault to the companies involved. Barbier plans to hold a second phase that examines BP's efforts to stop the spill and quantifies how much oil spilled into the Gulf.

Testimony by BP witnesses is expected to last at least two weeks.

As marijuana goes legit, investors rush in

Story originally appeared on USA Today.

Pot entrepreneurs have high expectations for a future market in legalized marijuana.

Brendan Kennedy and Michael Blue are nice boys. Really. They're bankers. Yale MBA classmates. Wearers of ties.

And, if luck and changing laws cooperate, they'll be drug barons of a certain kind.

Kennedy, 40, and Blue, 34, are in the vanguard springing up to seize the market for legal marijuana, which is accelerating with last fall's legalization of most personal pot consumption in Colorado and Washington state. They're running a Seattle private-equity fund, Privateer Holdings, designed to buy up the smaller marijuana-related businesses to create one bigfat one.

After Washington and Colorado, the pot business is, if not mainstream, at least ready to push toward it. Advocates hope to legalize personal use in another 14 states by 2017, mostly among the 16 states besides Washington and Colorado where medical pot is legal (it's also legal in Washington, D.C.). Industry estimates say today's $1.5 billion legal market could quadruple by 2018.

The public is trending toward legalization. In a Pew Research Center poll released Thursday, a majority of Americans (52%) favored legalization, the first time that threshold has been reached since polling on the issue began in 1969.

What's striking is how conventional many of the business people's backgrounds — and their plans — increasingly are. Instead of backing marijuana dispensaries, investors such as Privateer and San Francisco-based ArcView Group are rushing to find consulting firms, software companies and insurance agencies to serve the new market. Even Privateer's strategy of merging small companies to form a big one is familiar: In traditional buyout shops, it's called a "roll-up."

Just don't say that word to Kennedy, unless you want him to blush. Scratch the term "growing the business" — he catches that one in midsentence, correcting his wording to "expand.'' And forget weed, ganja or pot. He uses the scientific term, cannabis. And the cannabis business is good, he says.

"We're building the first all-inclusive name brand in the cannabis business,'' Kennedy declares earnestly. "And it doesn't include Bob Marley, or the Grateful Dead, or …''

"Or puns,'' Blue says drolly. "There are so many.''

Jokes aside, the striking thing about the new gold rush in pot is how familiar it sounds to people used to the technology business.

Just like Silicon Valley entrepreneurs, start-up pot investors such as Kennedy, Blue and ArcView CEO Troy Dayton — whose company runs an angel-investor network matching companies with rich activists — talk about how big and fragmented the market is, and how the relative handful of legal businesses out there lack the leadership and tools they need to (sorry, Mr. Kennedy) grow the industry. That leaves the field open for people who can bring capital and experience, they say.

That part is true. The best way to estimate the potential size of the legal market for cannabis begins with the illegal market — which is somewhere north of $18 billion a year in pot Americans consume already, said Harvard economist Jeffrey Miron. The trade journal Medical Marijuana Business Daily says the $1.5 billion legal market could reach $6 billion by 2018.

The challenges are myriad. Some are specific to selling a product still illegal in most states. But others are very ordinary, thanks partly to the business' Bohemian roots.

"It's not an industry loaded with operating talent,'' said Josh Rosen, a former Credit Suisse stock analyst who runs Phoenix-based MC Advisors, which backs renewable-energy companies and is, well, experimenting with pot. "But the economics are very similar to other businesses. You can run a Harvard Business School analysis.''

It's hard to say exactly how many people are trying to make pot a business like any other. About 2,000 legal dispensaries are open around the United States, estimates Kris Krane, managing director of Phoenix-based consulting firm 4Front Advisors. Privateer and Dayton's group are the biggest publicly announced clusters of investors. There are even a handful of public companies: The most valuable, San Diego-based Medical Marijuana, is worth about $200 million.

Increasingly, the cultural overlap between the pot business and just plain business is occurring because they're attracting the same people.

Adam Wiggins, a member of Dayton's investor network, sold software-as-a-service company Heroku to Salesforce.com for $250 million. Alan Valdes, chairman of Seattle-based Diego Pellicer — which plans 24 upscale marijuana shops as the anchor of what he hopes will become a Harley-Davidson-like lifestyle brand — is director of stock-exchange-floor operations for DME Securities. He appears sometimes on CNBC, talking about stocks. Kennedy, meanwhile, came from Silicon Valley Bank.

"The industry has grown up a lot since we launched in 2011,'' said Chris Walsh, editor of Medical Marijuana Business Daily. "It was the activists and hippies. We're seeing more grownups over the past two years, and accelerating in the last six months.''

Others involved still have an eye on the politics of the industry, as well as the economics. Dayton, for example, was chief fundraiser for the pro-legalization Marijuana Policy Project until 2010. Wiggins, who's on MPP's board, said they're not mutually exclusive.

"Almost any software you can think of is made by someone who enjoys a toke,'' he said.

BUT STILL DIFFERENT

Even so, selling pot is a federal crime — something that seeps into business conversations like smoke wafting under bedroom doors.

Many investors, including Privateer, plan to cut their risk by not buying and selling marijuana itself, Kennedy and Dayton said. MJ Freeway Software Solutions helps pot-dispensary owners document supply chains once considered evidence of conspiracies, while Krane advises them on how to adapt best practices on prosaic issues such as store design and human resources policy from top retailers like Old Navy.

Privateer's first buy was Leafly, a Yelp-like website and mobile app that reviews 500-plus strains of cannabis, luring 2.3 million monthly visitors. The heavy traffic has allowed Leafly to begin selling ads. Several help pot entrepreneurs who can't otherwise buy insurance because most insurers think their businesses are too risky, said Patrick McManamon, managing director of Cleveland agency Cannassure.

The people at the most legal risk, Kennedy and Blue reason, are marijuana dispensary owners, because the federal government could raid the stores and confiscate the investment. That stance may represent an abundance of caution: President Obama, whose memoir paints him as a regular pot smoker in his high school days, said in December that prosecutors have "bigger fish to fry'' than recreational pot users.

"We've never seen a consulting firm become a target,'' said Krane.

Citing a 2009 Department of Justice memo that said federal prosecutors shouldn't use resources to pursue marijuana businesses clearly complying with state law, he said he should be safe if he only serves clients licensed in their home states. But a different DOJ memo in 2011 said large-scale pot growing, even for medical marijuana shops, is still illegal, even when federal law allows it. Attorney General Eric Holder told a Senate committee last month that the department is still working on its response to Colorado's and Washington's new laws.

For Amy Poinsett and Jessica Billingsley, who run Denver-based MJ Freeway, helping store owners keep track of valuable product from field through the cash register is a valid software market: They sell to about 400 legal stores in the 16 medical-marijuana states, making their 2-year-old company profitable.

Wiggins was impressed enough to agree to invest in MJ this year. Its software illustrates that pot markets will behave like other markets — they'll get more capital-intensive, more concentrated and more professional, assuming legalization spreads, he said.

"I'm definitely a capitalist,'' he says. "And the operations technology always tends to be where the biggest change comes.'"

STILL A GAMBLE

Nothing about the rapid growth of marijuana markets, or even the hands-off-the-pot business strategy, is an automatic winner.

Clearly, the feds could cripple the business. Even the strategy of profiting from marijuana without touching it could run afoul of money-laundering laws, if those services are bought with drug proceeds, said UCLA professor Mark A.R. Kleiman, who is advising Washington's liquor board on regulating legal pot stores.

There's also a good chance that a legal pot market won't expand consumption as much as entrepreneurs think, Miron said. Colorado and California have already seen a sharp consolidation of medical-marijuana shops opened by people who thought the market would take off faster. A referendum on the ballot in Los Angeles in May would limit the number of medical-marijuana shops to 135 that opened by 2007. Careful regulation could also hurt a business that, like the alcohol industry, stands to make most of its profits from the few people who consume too much, Kleiman said.

"To the extent that there's money to be made, a lot of it is already being made,'' by illegal operations, Miron said. "The notion that there will be new wealth is exaggerated.''

That uncertainty doesn't bother those lining up for a green rush.

The marijuana business is packed with people who aren't much on conventional opinion, and pot smokers are used to legal risk, Rosen said.

Wiggins says the open-source software industry that made him rich "used to be a long-haired hippie business, too.'' Risk means less competition, because the weak-kneed won't jump in, Rosen said. "The extra layer of risk is where the opportunity comes from,'' he notes.

And, yeah, for some entrepreneurs and investors, a joint's lingering ability to shock is also part of the appeal.

Take Billingsley, MJ Freeway's chief operating officer. The 35-year-old mom lives in red-state Georgia, works on one of the most boring pieces of the drug business imaginable and looks basically like any other small-business owner who has spent a dozen years doing information-technology consulting. Yet she gets her own little buzz from messing with neighbors' heads, strategically doling out the news of what she does for a living.

"I used to be very circumspect about it,'' she said, laughing. "Now when I get bored at a kids' function, I just drop the bomb.''

NASCAR takes steps to drive 'green'

Story originally appeared on USA Today.

Racing teams are using a 15% ethanol blend and NASCAR has embarked on a tree-planting binge

With growling engines that gulp fuel, NASCAR isn't exactly the first place you'd go looking to find efforts to go green.

But spring has sprung, and for April, the racing organization is showcasing its efforts to become ecological. Well, as much as it can, anyway.

First and probably foremost, NASCAR is using a 15% ethanol blend for fuel, which is 50% more ethanol than is found in the E10 blends at everyday service stations. Ethanol is denatured alcohol usually made from corn. Of course, it's not E85, the 85% ethanol blend that's been around for years, but still is step in the right direction.

E15 fuel is going to be used in all three of NASCAR's national racing series.

NASCAR is making sure fans know about its "green" efforts. For instance, Kansas Speedway is going to stick the "NASCAR Green" logo on the infield grass and the backstretch wall. The start/finish line will be painted green. A Toyota Camry hybrid will serve as pace car for the race.

NASCAR has also gone on a tree-planting binge. The goal is to plant enough trees that offset the carbon emissions from all that NASCAR driving. It's not an impossible goal: NASCAR says a single tree absorbs a metric ton of carbon dioxide over its lifetime, about the same amount of carbon dioxide from a Spring Cup car driving 500 miles.

So, for instance, Ford plans to plant one tree for every lap a Ford driver leads in either of two racing series during April. And UPS has partnered with the Arbor Day Foundation to plant more than 8,000 trees.

"Our NASCAR Green activities this month comprise our most ambitious and collective effort to date in reducing our sport's impact on the environment," said NASCAR CEO Brian France in a statement.

Fukushima cooling system fails for second time in a month

This story originally appeared on the Guardian.

The cooling system for a fuel storage pool at one of the reactors at the Fukushima nuclear plant has failed, Japanese regulators have said.

There was no immediate danger from the failure, the second at the plant in a month, they said.

The Fukushima plant was severely damaged by the March 2011 tsunami that devastated Japan's north-east coast and suffered multiple meltdowns. It is currently in the process of being decommissioned.

A spokesman for the Nuclear Regulation Authority said an alarm went off on Friday afternoon at reactor No 3, and that the cause of the failure was still under investigation.

A spokesman for the plant's operator said it would take two weeks before temperatures approach dangerous levels following a cooling system failure.

Last month, a power cut caused a two-day failure in a cooling system.

Oil Pipeline Ruptures in Arkansas

Story originally appeared on the New York Times.

Emergency crews worked Saturday to contain several thousand gallons of crude oil that spilled from a ruptured Exxon Mobil pipeline in central Arkansas.obil were still investigating the cause of the rupture, which occurred on Friday afternoon in a section of the Pegasus pipeline near the town of Mayflower, which has about 1,700 people and is 25 miles north of Little Rock.

The local authorities said in a statement on Saturday that 22 homes in the vicinity of the spill had been evacuated.

As soon as the spill was detected, the pipeline was shut down and isolation valves were closed to prevent further leakage, Exxon Mobil said in a statement.

About 2,000 feet of boom was set up to contain the oil, and 15 vacuum trucks were deployed to clean it up, Exxon Mobil said. About 4,500 barrels of oil and water had been removed by Saturday evening, the company said.

Crews were working to make sure no oil entered nearby Lake Conway.

The Environmental Protection Agency classified the leak as a “major spill,” Exxon Mobil said.

Pipelines are the safest way to transport energy

Story originally appeared on Market Watch.

WASHINGTON (MarketWatch) — Wednesday’s 714-barrel oil spill in Minnesota came not from oil drilling or hydrofracturing, but from the derailment of a Canadian Pacific Railway train bringing Canadian oil to America.

How odd that those who profess concern for the environment are trying to block construction of oil pipelines, the safest way of transporting oil.

There’s no better example than President Barack Obama’s delay in approving construction of the Keystone XL Pipeline. If approved, the pipeline would bring oil from Canada, our closest trading partner, to American refineries in the Gulf of Mexico, enhancing America’s energy security. Instead, Canada’s oil arrives by rail — and Canada is planning to build another pipeline to its West coast to ship the oil to China.

A crew hired by Exxon Mobil cleans up an oil spill along the Yellowstone River in Montana after an Exxon Mobil pipeline ruptured, dumping up to 1,000 barrels of crude into the river.
On March 1 the State Department issued a draft supplementary environmental impact statement on Keystone XL, concluding that the pipeline would not harm the environment. Comments on the impact statement are due on April 22.

The relative safety of pipelines vis-à-vis road and rail to transport oil and gas is an important topic. Data published by the Department of Transportation show that pipelines have lower injury and fatality rates than road and rail, in addition to enjoying a substantial cost advantage.

These findings have substantial relevance for America’s energy future. Petroleum production in North America (Mexico, Canada, and the United States) is now over 16 million barrels a day, according to the Energy Information Agency, and could climb to 27 million barrels a day by 2020. Natural gas production in Canada and the United States could rise by a third over the same period, climbing to 22 billion cubic feet per day.

Whether oil and gas are produced in Canada, Alaska, North Dakota, or the Gulf of Mexico, it will be used all over the country, especially since new environmental regulations are resulting in the closures of coal-fired power plants. Large fleets of buses and trucks are switching to natural gas, General Motors and Chrysler are making dual-fuel pickup trucks, and newspapers are speculating about the timing of natural-gas passenger vehicles for the American market.

Pipelines result in fewer fatalities, injuries, and environmental damage than road and rail. Already almost 500,000 miles of interstate pipeline crisscross America, carrying crude oil, petroleum products, and natural gas. The network of pipelines has a remarkable safety record. Americans are more likely to get struck by lightning than to get killed in a pipeline accident.

America has 175,000 miles of onshore and offshore petroleum pipeline and 321,000 miles of natural-gas transmission and gathering pipeline. In addition, over 2 million miles of natural gas distribution pipeline send natural gas to businesses and consumers. This is expected to increase as America shifts to natural gas to take advantage of low prices that are expected to last into the foreseeable future.

Pipeline transportation of oil and gas is safer than transportation by road and rail. Pipelines are the primary mode of transportation for crude oil, petroleum products, and natural gas. Approximately 70% of crude oil and petroleum products are shipped by pipeline on a ton-mile basis. Tanker and barge traffic accounts for approximately 23% of oil shipments. Trucking accounts for 4% of shipments, and rail for the remaining 3%. Essentially all dry natural gas is shipped by pipeline to end users.

If safety and environmental damages in the transportation of oil and gas were proportionate to the volume of shipments, one would expect that the vast majority of damages to occur on pipelines. But the opposite is true: the majority of incidents occur on road and rail.

Data on pipeline safety are available from the United States Department of Transportation Pipeline and Hazardous Materials Safety Administration Office of Pipeline Safety. Operators report to PHMSA any incident that crosses a certain safety threshold. These reports enable the public to calculate the safety of pipelines in comparison to road and rail.

Oil spills from rail are increasing, according to the PHMSA. Between 2010 and 2012, the PHMSA reported 112 oil spills, compared to 10 spills between 2007 and 2009, according to calculations by the Wall Street Journal.

In contrast, injuries and fatalities from pipelines are declining. There were an average of 32 serious incidents — defined as those involving a fatality, or an injury requiring hospitalization — between 2010 and 2012, compared to 42 serious incidents between 2007 and 2009, and 38 between 2004 and 2006.

To draw another comparison, according to the National Weather Service, there were an average of 37 reported deaths annually caused by lightning from 2002 through 2011. Over the same period, fatalities related to pipeline incidents were about 15 per year. An individual had more than twice the chance of getting killed by lightning as being killed in a pipeline incident.

Some claim that pipelines carrying Canadian oil sands crude, known as diluted bitumen, have more internal corrosion, and are subject to more incidents. However, PHMSA data show no incidents of oil releases from corrosion from Canadian diluted bitumen between 2002 and 2010. Oil sands crude has been transported in American pipelines for the past decade.

Pipeline safety matters because America continues to ramp up production of oil and natural gas. We need better pipelines to get oil from North Dakota to the refineries in the Gulf, and natural gas from the Marcellus Shale in Pennsylvania and the Utica Shale in Ohio to the rest of the country.

The new American energy revolution is attracting energy-intensive manufacturing, such as petrochemicals and steel, back to America. In order for energy to travel to new manufacturing plants, we need more pipelines — the safest way to move fuel.

New York Assembly votes to extend fracking ban until 2015

Story originally appeared on the Washington Examiner.

The New York Assembly voted today to delay a decision on legalizing fracking in the state until 2015, extending a moratorium on the drilling practice that has been in place since 2008.

Lawmakers approved the moratorium over fears that fracking may be harmful to the environment, particularly drinking water. Fracking involves sending water mixed with sand and chemicals down a deep well shaft to bring trapped oil and gas to the surface.

“We will not sit idly by and endanger the health and safety of our communities by rushing necessary health and safety reviews,” Assembly Speaker Sheldon Silver said in a statement before the vote, according to Reuters.

The moratorium must still be passed by the state Senate where a similar bill was introduced yesterday, before it can be signed into law by Gov. Andrew Cuomo.

A group of senators, called the Independent Democratic Conference is also calling for a two-year delay until several health and environment reviews are completed, the Associated Press reported.

New York  last month missed its deadline for releasing the environmental impact report on fracking that would give regulators guidelines for drilling rules. The Department of Evironmental Conservation said at the time it would hold its report until the state’s Department of Health released its own review on the public health impacts of fracking.

Exxon discussing fracking with German authorities

Story originally appeared on Market Watch.

Exxon Mobil Corp. XOM +0.03%  has been discussing hydraulic fracturing with German regulators and communities as it looks at future exploration in the country, the company said in its 2012 financial and operational review released this week.

“Future exploration activities await the outcome of ongoing discussion with regulators and communities on the subject of hydraulic fracturing,” Exxon said in the document.

Exxon is Germany’s largest natural-gas producer, with Exxon-operated fields accounting for about 70% of all natural gas produced in the country. It holds nine exploration licenses in Germany, covering 2.8 million acres with shale gas, tight liquids, and coalbed methane, the company said.

Germany does not have an official ban or moratorium on hydraulic fracturing, or fracking, unlike countries such as France and the Netherlands.

Exxon’s “ultra cautious” comments, however, imply an informal policy more restrictive than markets realize, analysts at Raymond James said in a note Thursday to clients.

Chancellor Angela Merkel said earlier this year the country should be careful about it since Germany is more densely populated than the U.S. Germany’s environmental minister has said he wants to limit fracking and even ban it in certain areas.

Exxon is likely committed to Germany and the negotiations as three of its nine licenses were added in 2012.

The financial and operational review also offers more windows into Exxon’s far-flung empire, and puts them in more perspective.

For instance, Exxon acquired 192,000 net acres in the Bakken shale formation, increasing its position there by nearly 50%.

At the end of 2012, it completed its fifth acquisition in southern Oklahoma since 2010 — Exxon expanded its presence in the liquids-rich Woodford shale to more than 270,000 net acres.

Production there more than doubled in 2012 to about 19,000 barrels of oil equivalent a day from less than 5,000 barrels in 2010.

Output at Woodford and other shale areas in the Marietta Basin to the southwest could grow to more than 150,000 barrels of oil equivalent a day, Exxon said.

Exxon didn’t neglect conventional plays. It also increased its presence in offshore Gulf of Mexico by nearly 400,000 acres, participating in two lease actions there.

President pushes $2B alternative-fuel research fund

Story originally appeared on USA Today.

Appears to try to appeal to both parties by pitching plan not just as an environmental issue but as a job-creation plan that would help U.S. remain a technology leader.

WASHINGTON – President Barack Obama is in Chicago today, talking up the need for a $2-billion Energy Trust Fund he wants to help fund research into how to run the cars and trucks of the future on fuels other than oil.

Obama mentioned his proposal prominently in last month's State of the Union speech to Congress. But he put a price tag on the idea during a speech today at the Argonne National Laboratory outside Chicago: $2 billion over 10 years.

The White House said the money would come from earmarking for the fund revenue the federal government collects from leasing offshore oil and gas drilling sites, now some $6 billion per year.

A fact sheet released by the White House today said the "Energy Security Trust" would be designed to "invest in breakthrough research that will make the technologies of the future cheaper and better – technologies that will protect American families from spikes in gas prices and allow us to run our cars and trucks on electricity or homegrown fuels."

It said the research would be into "a range of cost-effective technologies" and mentioned specifically "advanced vehicles that run on electricity, homegrown biofuels, fuel cells and domestically produced natural gas."

Obama's plans for funding additional research into energy efficiency and advanced vehicle technology could run into hurdles, however. Some key members of Congress have raised questions about lagging sales of electric vehicles in the past and concerns have dogged funding put into some battery makers that failed to perform, such as A123 Systems which filed for bankruptcy reorganization last fall and is being sold primarily to a Chinese company.

Significant politically, perhaps, is that the proposal expands the range of technologies to be explored beyond electricity. Republicans have pushed to expand oil and gas drilling on federal land and water, while Obama and many Democrats have worked to boost renewable energy sources such as wind and solar power.

Obama appears to have tried to appeal to both parties by pitching the trust plan not just as an environmental issue but as a job-creation plan that would help the United States remain a technology leader.

David Pumphrey, co-director of the Energy and National Security program at the Center for Strategic and International Studies, said the proposal is likely to meet resistance in Congress. Obama was shrewd to frame the issue in terms of energy security and reducing oil imports, rather than as an effort to address climate change, but the plan "still takes a revenue stream and directs it into this usage" for clean energy, Pumphrey said. "That's $2 billon that could go to other uses or deficit reduction."

Still, there were signs agreement may be possible. Sen. Lisa Murkowski has called it "an idea I may agree with."
Murkowski, senior Republican on the Senate Energy Committee, did not fully endorse the plan, which is similar to one she has proposed to pay for research on new energy technology from with revenue from drilling for oil and natural gas on public lands that previously were off-limits to energy production.

White House officials told the Associated Press that the plan would not require opening federal lands or water where drilling is now banned; instead, they are counting on increased production from existing sites and streamlining of the permit process.

Argonne is a natural setting for a speech on energy technology, though. In 2012, it was selected for an award of up to $120-million over five years to establish a new Batteries and Energy Storage Hub aimed at advancing next generation battery and energy storage technologies both for cars and the nation's power grid.

The University of Michigan, Dow Chemical, Johnson Controls and Michigan Technological University were part of the Argonne-led Joint Center for Energy Storage Research, which was also supported to set up research hubs in Ann Arbor and Holland, Mich.

Obama is expected to call on Congress to approve the $2-billion Energy Trust Fund this year.

David Cameron says seabed mining could be worth £40bn to Britain

Story originally appeared on The Guardian

Prime minister says UK can be at head of industry but chooses American defence firm to exploit new Pacific licence

David Cameron has pledged to put Britain at the forefront of a new international seabed mining industry, which he claimed could be worth £40bn to the UK economy over the next 30 years.

But the prime minister has chosen an American defence company – Lockheed Martin – to spearhead the drive to collect from the depths of the ocean the copper, nickel and rare earth minerals used in mobile phones and solar panels.

Russia and China also have licences to "mine" the ocean bed but Cameron said on Thursday: "With our technology, skills, scientific and environmental expertise at the forefront, this demonstrates that the UK is open for business as we compete in the global race."

Speaking at a launch at the Excel Centre in London's Docklands, he said talks were already under way with a potential supply chain of up to 100 British companies, even though the main activity will take place off the west coast of America.

The Department for Business, Innovation and Skills has, in partnership with UK Seabed Resources – a newly formed subsidiary of Lockheed – obtained a licence and contract to explore a 58,000 sq km area of the Pacific Ocean for mineral-rich polymetallic "nodules".

These rocky chunks, the size of a tennis ball, will eventually be scooped up using a seabed harvester and then broken up to release the minerals, if all goes to plan. Lockheed claims to have discovered riches in that particular area off the US coast after a bizarre hunt in the 1970s for a lost Russian submarine paid for by eccentric US billionaire Howard Hughes.

The defence and aerospace group is keen to stress that its extraction measures are different from the deep-sea mining techniques that have been proposed by others and which have enraged environmentalists.

It also argues that the nodules containing rare earth minerals found on the seabed have little of the uranium content that has also been a brake on terrestrial mining in places such as Greenland.

"Environmentally responsible collection of polymetallic nodules presents a complex engineering challenge but our team has the knowledge and experience to help position the UK at the forefront of this emerging industry," said Stephen Ball, the British-born chief executive of UK Seabed Resources and of Lockheed Martin UK (a company that is part of the managing consortium of the Atomic Weapons Establishment at Aldermaston as well as being a key Ministry of Defence contractor.)

The science minister, David Willetts, also present at the project launch, said the UK should benefit from already being a leader in underwater robotics and autonomous systems used in the development of North Sea oil and gas.

Ball was more cautious than the prime minister about the potential to create thousands of jobs and bring in more than £1bn a year from the industry, saying he was not too keen on "aspirational promises".

And while he was keen that British companies should be engaged in future deepsea production, he said they would only be chosen if they were better than the competing foreign firms.

Currently the licence obtained from the International Seabed Authority (ISA) gives the UK government and Lockheed the right to explore but not extract, so a second licence would be required for that. And before any mechanical harvester is built, there will have to be a thorough environmental study, which could begin this summer.

The experience of the offshore wind industry has shown that even projects close to the coast of the UK have been driven by foreign companies using non-British suppliers.

Exploration outside 200-mile territorial waters can only be undertaken through application for a licence from the ISA, established under the United Nations law of the sea convention.

Russia recently signed a 15-year contract to prospect for metallic sulphides in the Atlantic, where volcanic hot springs create mineral-rich rock formations. Two applications for exploration were filed last summer for areas in the west Pacific Ocean, one from China and another from Japan.

Chinese Officials Dared to Swim in Toxic Water

Story first appeared on USA Today -

Swim for a half-hour in a river in east China's Cangnan county and win $48,000.
Sound like easy money? Take a look at the river.

Chinese angry about their toxic and trash-choked rivers have made online offers of cash rewards to the chiefs of their local government's environmental protection bureaus to take a swim in the waterways they are in charge of protecting.

One Internet posting offers $32,000 if an official will spend 20 minutes in a river in Rui'an or $16,000 for a 10-minute river dip in Dongguan down south.

None of the Internet users expects the officials to take the bait. The social media campaign against water pollution that inspired these rewards leads some analysts to hope authorities will take action after the relative success of a public movement to increase government transparency over the abysmal air quality in many Chinese cities.

China's water and air quality has long been sacrificed by the government to China's thirst for industrial growth in recent decades. Even the government releases grim statistics: 64% of groundwater in 118 Chinese cities is "severely polluted," state news agency Xinhua reports.

To provide examples, Chinese journalist and activist Deng Fei, whose Twitter-like micro-blog has almost 3 million followers, asked people last week to post pictures of rivers in their hometowns as they traveled there for the recent Lunar New Year celebrations.

The strong response, by thousands of Chinese Internet users, "shows more Chinese pay close attention to pollution, and now they have the tools to express their opinions," Deng said.

Although China's citizens still lack formal channels, such as democratic elections, to influence their government, this social-media-driven campaign "has become a large-scale discussion topic that shows the will of the people," so China's "parliament," the National People's Congress (NPC), and ministries must take notice, he said.

Two delegates to next month's annual session of the NPC — when the ruling Communist Party's new leader, Xi Jinping, will be appointed president — promised to raise the issue of water pollution, Deng said.

The rewards for hazardous swimming started Saturday when eyeglass entrepreneur Jin Zengmin posted photos online of a filthy river in Rui'an in Zhejiang province, with his $32,000 bet for the area's environmental protection director. Jin reminisced about swimming in the river as a child and watching his mother washing clothes there.

"Even animals don't dare swim in these rivers, much less officials," Deng said.

The offering of money "is an expression of anger and frustration over the dereliction of duty by local environmental officials and their failure to enforce the rules," said Ma Jun, director of the Institute of Public and Environmental Affairs, a Beijing-based non-profit group.  Middle-aged Chinese "remember their rivers used to be cleaner, drinkable, swimmable and touchable, but no longer," he said.

This social media push has the potential to grow into something similar to the air quality campaign, given that the problem of water pollution is as bad or even worse, Ma said. "The local government still puts GDP (gross domestic product) rate ahead of environmental protection. We need the public to change that," he said.

The chief environmental official in Rui'an, Bao Zhenmin, blamed river pollution on rubbish discarded by residents and migrant workers, not shoe factories, as Jin alleged. Bao promised steps to reduce the problem, chinanews.com reported.

Deng said the answer is for the government to share more information with the public about water discharges, increase legal penalties against illegal discharges and ease restrictions on people filing lawsuits in environmental cases. He said environmental offices should be controlled by Beijing, not the local governments often responsible for pollution.