Energy Tomorrow Blog
Posted August 7, 2020
Modern, resilient natural gas and oil infrastructure is vital to maintaining U.S. energy affordability and economic competitiveness. As the industry undergoes rapid digitalization, reliability remains fundamental to energy operations, particularly as cybersecurity risks present emerging challenges.
The U.S. has been subject to an increasing volume of malicious cyberattacks from China, Russia and other foreign adversaries, posing a persistent threat to our national security and grid reliability. Within the next two years, 2.5 billion industrial devices will be brought online in the energy industry, meaning the need to protect our critical infrastructure assets has never been more urgent.
Posted August 6, 2020
There are two new developments with the federal Nationwide Permit 12 program (NWP 12), which is critically important for key infrastructure projects of all kinds. Both point to the need for a clear, efficient, common-sense permitting program that balances environmental protection with streamlining projects that have limited environmental impacts.
Achieving this is occurring on two tracks. U.S. senators have introduced legislation that would cut red tape and in the short term help reestablish regulatory order and allow infrastructure projects to proceed if they’re following certain species protection rules already in the NWP 12. Meanwhile the U.S. Army Corps of Engineers has a proposal that includes renewing more than 50 Nationwide Permits for the next five years. This is important because the permits would expire in March 2022 otherwise.
Posted August 4, 2020
Let’s follow up on the recent news coming out of The Environmental Partnership – that the group is opening membership to industry’s midstream sector and that participants are discussing the best ways to reduce routine flaring.
Both are big-time developments; both show that the Partnership is doing what it set out to do when it was born in December 2017. Both will help protect the environment and reduce greenhouse gas emissions – even as our industry produces the energy Americans count on every day.
Adding midstream companies (including pipelines and storage infrastructure) comes as the Partnership reports more than tripling its membership, including 36 of the top 40 U.S. natural gas producers. It’s more than numbers. Each new member company means a new commitment to improve environmental performance in the field. Growth means the Partnership’s program to reduce methane emissions is extending further across the country. And now, here comes the midstream.
Posted August 3, 2020
As we head into the heart of what is forecast to be an above-normal hurricane season, the natural gas and oil industry stands prepared to protect energy workers, neighboring communities, and the energy production facilities and infrastructure that are vital to keeping Americans well supplied.
Industry preparations help minimize the risk of extreme weather to critical energy infrastructure, including refineries and pipelines, and allow for rapid response to hurricane impacts – specifically, to help limit supply disruptions and aid the recovery. Of course, major weather events test preparations, but we are focused on being as prepared as possible for this season.
Posted July 31, 2020
Former Vice President Joe Biden's camp says he wouldn’t completely ban hydraulic fracturing (see the New York Times and here) – the technology most responsible for a domestic energy revolution that has made the U.S. the world’s leading producer of natural gas and oil. While Biden’s proposal to end new federal fracking leases is misguided, the fact he wouldn’t try to ban it elsewhere may suggest a recognition that fracking is critically important to the U.S. economy and national security.
This could indicate some important common ground, which API President and CEO Mike Sommers addressed in the Times article.This is especially welcome news for the nation’s electricity grid operators. They’re on the front lines of the twin effort to provide affordable energy to American homes and businesses, while lowering carbon dioxide emissions from power generation. For them, clean and reliable natural gas is the cornerstone for succeeding on both fronts, which is why natural gas is the nation’s No. 1 fuel for power generation.
Posted July 30, 2020
There’s a basic principle in play in recent news developments in Massachusetts and Ohio – that public energy policy should serve people, not the other way around. In both states, access to clean natural gas, for affordable, reliable energy, means benefits for consumers.
Start in Massachusetts, where the state attorney general struck down the town of Brookline’s bylaw that would have barred new residences from installing natural gas infrastructure for space heating and hot water – mimicking similar restrictions imposed by Berkeley, California. That doesn’t necessarily mean Massachusetts AG Maura Healey has an affinity for natural gas; her decision was based on the primacy of state law and regulations.
No matter, consumers win. And in the process this point is elevated: Public bodies should ensure that dependable, affordable energy is available to consumers – instead of erecting artificial, market-distorting barriers to service.
Posted July 29, 2020
A metric that bears watching as we gauge energy markets, trade, manufacturing and supply chains – all of which contribute to global economic growth and prosperity – is FDI, foreign direct investment, especially for energy projects in the U.S. and other nations.
Recent data indicate that FDI has dropped by half since its peak in 2015, and experts believe that various factors, including the pandemic and escalated trade tensions, could continue or accelerate this decrease. This is potentially significant for the construction of new infrastructure, plants, processing facilities and other projects that have a direct bearing on better serving U.S. consumers and harnessing American energy.
Indeed, recent FDI trends signal a potential turning point.
John D. Siciliano
Posted July 24, 2020
Key Appalachian swing states continue to competitively produce the majority of America’s natural gas supply, despite a global pandemic that continues to pose major challenges for the industry.
Natural gas production in Ohio, Pennsylvania and West Virginia has skyrocketed in the last decade, making the Appalachian region the No. 3 natural gas producer globally behind Russia and the remainder of the United States. This has transformed the region into an energy powerhouse, one that continues to show room for growth.
Posted July 22, 2020
With the U.S. House scheduled to vote on legislation that would create permanent, dedicated funding for the Land and Water Conservation Fund (LWCF), amazing photos from parks and recreation areas around the U.S. make the case for supporting the country’s most important federal conservation initiative. The beautiful images show just a small fraction of the preservation, history and other outdoor opportunities across the U.S. that benefit from LWCF.
Since 1965 the fund has supplied billions of dollars for parks, conservation and recreation across all 50 states. Virtually all of that money was supplied by safe, responsible offshore oil and natural gas development. As we noted last month, when the legislation was moving through the U.S. Senate, the Wilderness Society says LWCF has been “America’s most important conservation funding tool for nearly 50 years.”
Posted July 21, 2020
Through the recent COVID-19 pandemic and resulting shocks to energy markets around the world, U.S. natural gas has remained a relatively bright spot.
Record low prices have benefitted consumers, and at the same time many producers dedicated to natural gas in Pennsylvania, Ohio, West Virginia, Louisiana and East Texas have remained viable as cutbacks in oil and associated natural gas from other regions have taken effect. And now about 90% of U.S. drilling for natural gas is concentrated in these regions, that is Appalachia and the Haynesville areas.
The drilling activity has reflected two fundamental observations. The first is that, according to BTU Analytics, the recent breakeven price – that is, the Henry Hub wholesale market price needed to at least break even in drilling a new well – on average has remained near market prices despite COVID-19, a relatively warm winter and broad financial market concerns. The second observation is that natural gas well productivity, as reported by the U.S. Energy Information Administration, were resilient after some unexplained variation at the beginning of the year.