Tuesday, November 23, 2010

EPA reportedly delays E15 decision on older vehicles

The US Environmental Protection Agency reportedly has delayed making a decision on the use of gasoline with 15% ethanol in cars and pickup trucks built from 2001 to 2006.

As of Nov. 23, Oil & Gas Journal had received no official statement from EPA regarding the delay as reported by some other media outlets.

The American Petroleum Institute greeted the reported delay as welcomed news while the Renewable Fuels Association expressed disappointment.

RFA Pres. and Chief Executive Officer Bob Dinneen encouraged EPA to extend due diligence to testing for all cars and pickups, regardless of age. RFA is a trade association for the US ethanol industry.

“We believe the fuel testing to date clearly demonstrates the efficacy of E15 as a motor fuel for all light-duty vehicles," Dinneen said.

API Downstream Director Bob Greco said API previously suggested EPA should extend its review 6 months or more to allow scientific testing to be completed on the effects of E15 on the engines of older vehicles.

He noted the US oil and natural gas industry is the biggest consumer of ethanol and other biofuels.

“We support a realistic and workable Renewable Fuel Standard and the responsible introduction of increased biofuels in a manner that protects consumers,” Greco said. “However, rushing to allow more ethanol before we know it is safe could be disastrous for consumers and could jeopardize the future of renewable fuels."

On Oct. 13, EPA partially waived its 10% limit on ethanol, allowing up to 5% more for model year 2007 or newer cars and light trucks. DOE said testing was under way on E15’s use in 2001-06 model year vehicles, and the agency had expected to announce a decision this month. But as of Nov. 19, that decision reportedly has been delayed for up to 30 days.

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Thursday, November 18, 2010

Oil companies review their safety policies following Macondo spill

Oil and gas industry executives surveyed by Delotte LLP were about evenly split regarding whether changing US offshore regulations actually will improve drilling safety.

Of 201 executives polled earlier this month, 41% said yes while 42% said no. The rest said they don't know.

Regarding future corporate health and safety policy, 57% said their companies are more likely to review and update HSE policy as a result of BP PLC's Macondo well blowout and the resulting explosion and fire on Transocean Ltd.'s Deepwater Horizon semisubmersible. The accident triggered a massive oil spill in the Gulf of Mexico.

Nearly 60% of those polled said any improvements in drilling safety will come from the industry itself rather than from government regulations or third-party insurance and financing requirements.

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Wednesday, November 10, 2010

Macondo oil spill highlights gulf coast vunerabilities

Hurricanes and oil spills along the Gulf of Mexico typically bring renewed attention to the region’s disappearing wetlands and its fragile barrier islands. Countless people saw many pictures of oily brown pelicans and their stained nesting grounds in the aftermath of the Macondo well blowout and subsequent oil spill.

An inaugural World Delta Dialogues conference in New Orleans during October focused on the Mississippi River Delta where an estimated 25 sq miles/year erodes into open water. Some 350 people, including representatives from oil companies, attended the conference organized by America’s Wetlands Foundation.

Entergy Corp., a nuclear power provider, used the conference as a forum to release a study entitled “Building a Resilient Energy Gulf Coast.” America’s Energy Coast and America’s Wetlands Foundation supported the study. Entergy helped commission the study done by McKinsey & Co. and Swiss Re.

Global warming, rising sea levels, subsidence, and stronger, more frequent hurricanes all make the gulf coast vulnerable, said Wayne Leonard, Entergy chairman and chief executive officer. He called the study a “call to arms” for governors, lawmakers, and oil and gas companies.

The study examined potential benefits of various options, including changes in levees and coastal building codes along with changes in offshore drilling practices and production platform standards.

The study examined coastal counties and parishes along Texas, Coastal Mississippi, and Alabama where energy is key to the economy. A study executive report said that the gulf region averages losses of $14 billion/year, and that those losses are expected to climb in coming years.

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Wednesday, November 3, 2010

Gov. Schwarzenegger links GHG proposition, baseball

An Oil & Gas Journal blogger usually cannot find a legitimate way to write about baseball, but California Gov. Arnold Schwarzenegger opened the door with his celebratory comments regarding state election results, specifically the overwhelming defeat of Proposition 23.

That proposition would have suspended the scheduled 2012 implementation of California’s law calling for reduced greenhouse gas emissions. Had California voters approved Proposition 23, they would have stalled Assembly Bill 32 from becoming effective until the state’s current 12.4% unemployment rate falls to 5.5% for 1 year.

"Today, we have beaten Texas again," Schwarzenegger said. "Speaking to No on 23…World Series or an election, I'll always take California over Texas.”

Valero Energy Corp., and Tesoro Corp., both based in San Antonio, Tex., along with Flint Hills Resources of Wichita, Kan., contributed heavily in support of Proposition 23. Valero and Tesoro, which both have multimillion-dollar payrolls in California, argue AB 32 threatens jobs and will trigger higher electric and natural gas rates for California residents.

It’s possible the governor spoke too soon. Although the San Francisco Giants won the World Series by defeating the Texas Rangers, the story might not be over just yet on the fate of AB 32. Texas Atty. Gen. Greg Abbott and others might try to stop AB 32 from being implemented.

California Watch, a project of the nonprofit Independent Center for Investigative Reporting, says that Abbott and his counterparts in Alabama, Nebraska, and North Dakota are contemplating a legal challenge against AB 32 by claiming that it interferes with the right to freely conduct interstate commerce.

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