Posted March 20, 2014
The U.S. shale boom is beginning to ripple outward to American cities.
The shale mining industry's rising demand for materials and equipment along with the abundance of cheap fuel are fueling a modest renaissance in American manufacturing, according to a report prepared by IHS Global insight for the U.S. Conference of Mayors.
The shale extraction industry is itself driving growth through its hunger for steel pipeline, extraction machinery and other materials needed at domestic shale deposits, including the Bakken in North Dakota and the Marcellus shale in Pennsylvania. The availability of cheap fuel has in turn allowed these energy intensive manufacturing industries to cut costs and compete better with foreign imports.
Posted March 19, 2014
Posted March 17, 2014
Happy birthday, fracking! What a fantastic, 65-year ride it has been – and here’s to another 65 years and more.
Advanced hydraulic fracturing and horizontal drilling launched an oil and natural gas renaissance in this country – bringing dynamic job creation, economic stimulus that radiates well beyond the oil and natural gas industry proper and greater energy security. Thanks to fracking, the United States is an energy superpower that, with the right policies, can harness its vast resources to ensure a significantly better future for its citizens while reducing energy-related tension across the globe.
Posted March 11, 2014
Denver Post Editorial: Speeding up U.S. natural gas exports was a good idea even before the crisis in Crimea, but it's an even better idea now.
It's not as if U.S. exports are going to undermine Vladimir Putin's imperialistic designs in the short term. Ukraine would love to be less dependent on Russia for natural gas, but the export infrastructure in the U.S. for liquefied natural gas (LNG), particularly in terms of ports, isn't ready.
Indeed, the earliest that an export terminal is expected to come on line is in late 2015, with other terminals becoming operational perhaps a couple of years later. For that matter, the government doesn't direct where exports go. If the price in Asia for LNG is higher than in Europe, U.S. exports will tend to wind up there.
Still, the more gas is available worldwide, the less leverage Putin will have in bullying neighbors and in talks with European powers such as Germany, which also depends on Russian gas.
Posted March 10, 2014
Fracking Uses Lots of Water? Hardly
Real Clear Energy: For some reason, hydraulic fracking has gotten a reputation for using a lot of water. Not so, says Economic Policies for the 21st Century at the Manhattan Institute. When you look at the actual amount of water used in the process, hydraulic fracking comes out at the bottom of the list. As the report observes, "It takes twice as much water to maintain a golf course for a month than to frack a natural gas well."
Don't forget, all other energy resources use a lot of water, too. Biofuels is the biggest offender, since huge amounts of water are required to process and dilute the organic material. When the irrigation water needed to grow the crops is included, biofuels consume in excess of 2500 gallons of water per million BTU. (That may be cheating a bit since some advanced biofuel crops may not require irrigation, but the current corn crop, the source of all our ethanol, is heavily irrigated.) All forms of oil drilling require lots of water since water usually has to be added once a well passes maturity.
Posted February 26, 2014
Surge in Fuel Exports Boosting U.S. Trade Balance
Fuel Fix Blog: HOUSTON — Growing production of U.S. oil and gas is helping to improve the nation’s trade balance, according to a federal report Monday.
Dramatic growth in the export of refined petroleum products, such as jet fuel and gasoline, has led the way. The value of net refined exports increased 55 percent in 2013 over the prior year, reaching $33 billion, according to the U.S. Energy Information Administration.
U.S. refiners are finding cheaper domestic alternatives to overseas oil, causing a rally in the ratio of refined fuel exports to imports. Overall energy export values increased 8 percent in 2013 over the prior year. Total energy imports to the U.S. fell by 11 percent for the same time period.
Posted February 21, 2014
Well-Being in America: Shale Gas Buys You Happiness
The Economist: Based on interviews with more than 178,000 people from all 50 states, the Well-Being Index offers an interesting glimpse of the physical and mental health of the nation. It also spotlights the country's winners and losers. The results divide regionally, with Midwestern and Western states earning nine of the ten best scores in 2013, while Southern states have eight of the ten lowest. Massachusetts has the highest rate of residents with health insurance (which may bode well for Obamacare). Colorado, meanwhile, nearly always has the lowest obesity rate.
Sitting pretty in first place now is North Dakota, which has displaced Hawaii as the state where people are most likely to be healthy and feel good about their life and work. North Dakota’s speedy climb to first place from 19 last year seems to have a lot to do with the shale-gas boom, which has buoyed the state with lots of new jobs and money. This bonanza has apparently trickled into South Dakota, which has elbowed aside Colorado to secure second place.
Posted February 20, 2014
Welcome to ‘Saudi Texas’
U.S. News & World Report (Laskoski): To fully appreciate what many of us may simply take for granted — that the Lone Star state produces oil as easily as McDonald’s produces hamburgers — it sometimes helps to look elsewhere to appreciate the actual scale by which we should view such things.
The Associated Press reported this month that North Dakota produced 313 million barrels of oil in 2013, a record amount, and about 70 million more than it produced in 2012. For North Dakota, that’s six consecutive years of record oil production. State data shows that the 185 oil rigs working there now double the amount from four years ago. And you’ve certainly heard about the economic boom and jobs growth that has drawn thousands from all across the country seeking their fortune.
But when your attention is drawn to the Texas oil boom, that discussion takes place on another plane because of the previously inaccessible shale wealth that transforms state economies via fracking. Jonathan Cogan of the Energy Information Administration noted this week that production in the Eagle Ford formation in South Texas reached 1.2 million barrels per day in December. Additionally, production from the Permian Basin averaged 1.3 million bpd and is projected to grow more than any other U.S. region through 2015.
Posted February 19, 2014
The Geopolitical Consequences of the Shale Revolution
Foreign Affairs (Blackwell and O’Sullivan): Only five years ago, the world’s supply of oil appeared to be peaking, and as conventional gas production declined in the United States, it seemed that the country would become dependent on costly natural gas imports. But in the years since, those predictions have proved spectacularly wrong. Global energy production has begun to shift away from traditional suppliers in Eurasia and the Middle East, as producers tap unconventional gas and oil resources around the world, from the waters of Australia, Brazil, Africa, and the Mediterranean to the oil sands of Alberta. The greatest revolution, however, has taken place in the United States, where producers have taken advantage of two newly viable technologies to unlock resources once deemed commercially infeasible: horizontal drilling, which allows wells to penetrate bands of shale deep underground, and hydraulic fracturing, or fracking, which uses the injection of high-pressure fluid to release gas and oil from rock formations.
Posted February 13, 2014
Fuel Fix Blog: While the January jobs report was a disappointing for the national economy, it brought good news about growth in oil and gas.
About 206,000 employees worked in the oil and gas extraction sector in January, about 1.8 percent more than in December, according to the Bureau of Labor Statistics. Nationwide, total employment was relatively stagnant at a seasonally adjusted 137.5 million.
The employment story was positive across sectors of the energy industry. Manufacturing of petroleum and coal products had 112,700 employees on payrolls, a 1.6 percent increase from December. The chemicals sector grew by 1.2 percent to 796,100 people.