Views: Strait of Hormuz

Map of shipping lanes in Strait of Hormuz.

Earthiew of the Strait of Hormuz,

Noble: Cyprus Gas Discovery

Noble success continues

Noble Energy announced Wednesday a natural gas discovery at the Cyprus Block 12 prospect, offshore the Republic of Cyprus.
The Cyprus A-1 well encountered approximately 310 feet of net natural gas pay in multiple high-quality Miocene sand intervals.
The discovery well was drilled to a depth of 19,225 feet in water depth of about 5,540 feet. Results from drilling, formation logs and initial evaluation work indicate an estimated gross resource range(1) of 5 to 8 trillion cubic feet (Tcf), with a gross mean of 7 Tcf.

Pavillion Field: IPAA response

Quick Links Energy in Depth Responds:  Six Questions for the EPA on Pavillion Statement from Wyoming Governor Statement from Petroleum Association of Wyoming Five Quick Facts on Pavillion EPA Draft Report (Large File)	December 9, 2011 Dear IPAA Members and Colleagues: Yesterday, the Environmental Protection Agency released a draft report on natural gas drilling in the town of Pavillion, Wyoming.  According to the EPA's press release, "The draft report indicates that ground water in the aquifer contains compounds likely associated with gas production practices, including hydraulic fracturing."  The report is still in draft form and needs to be peer-reviewed. The onus is now on EPA to legitimize this report after more than six decades of safely hydraulic fracturing over a million wells.  As we have seen time and again, the current EPA has made our industry a primary target.  Most news headlines already have it wrong, instead reporting some conclusive link that hydraulic fracturing contaminates drinking water.  Today's New York Times' headline pounces:  "E.P.A. Links Tainted Water in Wyoming to Hydraulic Fracturing for Natural Gas." IPAA filed this week a Freedom of Information Act (FOIA) request to EPA on this draft report, particularly whether it had been "leaked" prior to its public release yesterday. Energy in Depth, the hydraulic fracturing and environmental issues coalition managed by the Independent Petroleum Association of America, released the following Issue Alert.  I thought you might be interested, in case you have questions arise in your communities.  Please feel free to contact us if you comments or questions. Sincerely, Barry Russell President and CEO Six Questions for EPA on Pavillion Draft report from EPA in Denver produces lots more questions than answers; EID poses a few of its own Call it a sign of the “Times,” let’s say, that less than 24 hours removed from the release of EPA Region 8’s report on groundwater sampling near Pavillion, Wyo., nearly a thousand different news stories have been generated -- in 12 different countries, and best we can tell, four different languages. But set aside the breathless headlines for a moment and the triumphant quotes from a small segment of folks committed to ending the responsible development of natural gas, and one’s left with a pretty straightforward question: Is EPA right? And if so, what exactly does that mean moving forward? Of course, before you can answer the second question, it’d be helpful if you had a good answer for the first. And the truth is, as we sit here today, less than 20 hours A.P. (After Pavillion), we simply don’t. What we do know, however, even at these early stages, is that several of the assertions put forth in EPA’s report yesterday don’t quite square with the facts as they actually exist on the ground out there. Because of that, a number of folks are starting to ask some pretty basic questions about what the agency found and how it went about finding it. Below, a few of the most obvious: 1) Why the huge difference between what EPA found in its monitoring wells and what was detected in private wells from which people actually get their water? · Contrary to what was reported yesterday, the compounds of greatest concern detected by EPA in Pavillion weren’t found in water wells that actually supply residents their water – they were detected by two “monitoring wells” drilled by EPA outside of town.  · After several rounds of EPA testing of domestic drinking water wells in town, only one organic compound (bis (2-ethylhexyl) phthalate) was found to exceed state or federal drinking water standards – an additive in plastics and one of the most commonly detected organic compounds in water. According to EPA: “Detections in drinking water wells are generally below established health and safety standards.”  · Bruce Hinchey, president of Petroleum Association of Wyoming: “Let me be clear, the EPA’s findings indicate that there is no connection between oil and natural gas operations and impacts to domestic water wells.” (PAW press release, Dec. 8, 2011)  · In contrast, EPA found “a wide variety of organic chemicals” in its two monitoring wells, with greater concentrations found in the deeper of the two. The only problem? EPA drilled its monitoring wells into a hydrocarbon-bearing formation. Think it’s possible that could explain the presence of hydrocarbons?  · According to governor of Wyoming: “The study released today from EPA was based on data from two test wells drilled in 2010 and tested once that year and once in April, 2011. Those test wells are deeper than drinking wells. The data from the test wells was not available to the rest of the working group until a month ago.” (Gov. Mead press release, issued Dec. 8, 2011)  2) After reviewing the data collected by Region 8, why did EPA administrator Lisa Jackson tell a reporter that, specific to Pavillion, “we have absolutely no indication now that drinking water is at risk”? (video available here)  · Of note, Administrator Jackson offered those comments to a reporter from energyNOW! a full week after Region 8 publicly released its final batch of Pavillion data. In that interview, Jackson indicates that she personally analyzed the findings of the report, and was personally involved in conversations and consultations with staff, local officials, environmental groups, the state and the operator.  · After reviewing all that information, and conducting all those interviews, if the administrator believed that test results from EPA’s monitoring wells posed a danger to the community, why would she say the opposite of that on television?  · And if she believed that the state of Wyoming had failed to do its job, why would she – in that same interview – tell energyNOW! that “you can’t start to talk about a federal role [in regulating fracturing] without acknowledging the very strong state role.” (2:46) A week later, why did she choose to double-down on those comments in an interview with Rachel Maddow, telling the cable host that “states are stepping up and doing a good job”? (9:01, aired Nov. 21, 2011)  3) Did all those chemicals that EPA used to drill its monitoring wells affect the results?  · Diethanolamine? Anionic polyacrylamide? Trydymite? Bentonite? Contrary to conventional wisdom, chemicals are needed to drill wells, not just fracture them – even when the purpose of those wells has nothing to do with oil or natural gas development.  · In this case, however, EPA’s decision to use “dense soda ash” as part of the process for drilling its monitoring wells could have proved a bad one.  · One of the main justifications EPA uses to implicate hydraulic fracturing as a source of potential contamination is the high pH readings it says it found in its monitoring wells. But dense soda ash has a recorded pH (11.5) very similar to the level found in the deep wells, creating the possibility that the high pH recorded by EPA could have been caused by the very chemicals it used to drill its own wells.  · According to Tom Doll, supervisor of the Wyoming Oil and Gas Conservation Commission: “More sampling is needed to rule out surface contamination or the process of building these test wells as the source of the concerning results.” (as quoted in governor’s press release, Dec. 8, 2011)  4) Why is the author so confident that fracturing is to blame when most of his actual report focuses on potential issues with casing, cement and legacy pits?  · The report singles-out old legacy pits (which the operator had already voluntarily placed in a state remediation program prior to EPA's investigation) as the most obvious source of potential contamination. These decades-old pits, which are obviously no longer used, have nothing to do with hydraulic fracturing.  · From the report (page xi): "Detection of high concentrations of benzene, xylenes, gasoline range organics, diesel range organics, and total purgeable hydrocarbons in ground water samples from shallow monitoring wells near pits indicates that pits are a source of shallow ground water contamination in the area of investigation. Pits were used for disposal of drilling cuttings, flowback, and produced water. There are at least 33 pits in the area of investigation."  · From the report’s concluding paragraph: “[T]his investigation supports recommendations made by the U.S. Department of Energy Panel on … greater emphasis on well construction and integrity requirements and testing. As stated by the panel, implementation of these recommendations would decrease the likelihood of impact to ground water and increase public confidence in the technology.” (p. 39)  5) 2-BE or not 2-BE? That is the question.  · EPA indicates that it found tris (2-butoxyethyl) phosphate in a few domestic water wells. What the agency doesn’t mention is that this chemical is a common fire retardant found in plastics and plastic components used in drinking water wells. It’s not 2-BE, which, although also a common material, is sometimes associated with the completions process.  · According to EPA, in one of the eight samples collected, a small amount of 2-BE was detected. Interestingly, two other EPA labs that measured for the same exact compound reported not being able to detect it in the duplicate samples they were given.  · According to Wyo. governor Mead: “Members of the [Pavillion] working group also have questions about the compound 2-BE, which was found in 1 sample … while other labs tested the exact same water sample and did not find it.” (Mead press release, Dec. 8, 2011)  6) Is EPA getting enough potassium?  · Several times in its report, EPA notes that potassium and chloride levels were found to be elevated in its monitoring wells. But just because you have potassium and chloride doesn’t mean you’ve got potassium chloride, a different chemical entirely and one that’s sometimes associated with fracturing solutions. Nowhere in its report does EPA suggest that potassium chloride was detected.  · According to several USGS studies of groundwater quality in the area, variable -- and in some cases, high -- concentrations of potassium and chloride have been detected in Pavillion-area groundwater for more than 20 years. (USGS 1991, 1992)  · Interestingly, the potassium levels detected in EPA’s first monitoring well declined by more than 50 percent from October 2010 to April 2011, while the potassium level in EPA’s second monitoring well increased during that same period. Only natural variations in groundwater flow and/or composition could have accounted for this disparity. www.energyindepth.org

Colorado snowpack: Dec 19th

Three Gorges Dam: China

World Records Set by the Three Gorges Dam

The world’s largest and grandest water conservancy project, the Three Gorges Dam has set a series (over 100) of world engineering records by various indices. It is, or has:-

- the world’s most effective multi-functional water control system, consisting of a dam, a five-tier ship lock, and 26 hydropower turbo-generators;
- the world’s largest power station, total installed capacity reaching 18.2 million kW and annual power generation 846.7 billion kWh;
- the world’s grandest engineering project for water conservancy, earthwork (excavation & backfilling) totaling 134 million m3, concrete consumption 279.4 million m3, steel reinforcement 463,000 tonnes;
- the world’s greatest floor discharging capacity, up to 102.5 m³/s;
- the world’s largest number of stages of ship locks (staircase locks, nos. two, each with five stages and a total water head of 113m);
- (yet to be completed) the world’s largest ship lift (dimension of the basin: 120×18×3.5m), maximum vertical travel distance being 113m, capable of lifting ships of 3000t;
- the world’s largest human resettlement program associated with an engineering project, total population having to be relocated being estimated at 1.13 million.

Marcellus Cumulative Gas Production West Virginia

Marcellus Shale

Comingled wells excluded

259 Total wells

212 Vertical, 47 horizontal

Marcellus Shale West Virgina

The Middle Devonian Marcellus Shale Play has put the Appalachian Basin at the center of a national debate concerning America’s future energy supply. Although it has been received in the region with mixed reviews, this highly organic shale formation has secured itself as a major contributor to the natural gas supply of West Virginia and other states in the Basin. As production continues throughout West Virginia, areas of high production continue to emerge; however, it appears that some of these “sweet spots” may not actually be within the “Marcellus” per se, but rather, in other, overlying Devonian shales.

Time for Energy Secretary Chu to Leave?

The White House has denied the critics charges of any connection between politics and "green energy" loans, however, recent emails and scrutiny at the Solyndra Congressional Inquiry have discovered a preference  given to Democrat donors seeking loans. The emails suggest a correlation beyond just the timing timing of political announcements to questions about the White Houses overall policy of handing out taxpayer money.

The Solyndra hearing revealed a series of questionable actions, 1)the rush to announce the Solyndra loan and 2) the process that lacked appropriate financial oversight. Solyndra investor George Kaiser and other Obama contributors had "unfettered" access to the West Wing of the White House. Additionally, Energy Secretary Chu approved subordination of the Solyndra loans so that taxpayers would be repaid after two commercial firms, a violation of the Energy Policy Act of 2005.

The green energy subsidies show that several well connected Democrats obtained taxpayer assistance for environmentally friendly projects. These recipients include: (from Fox news)

-- Solyndra, which received $535 million in loan guarantees and whose chief investor was the George Kaiser Family Foundation. George Kaiser was an Obama campaign bundler.

-- Brightsource Energy, which received $1.6 billion and whose senior adviser is Robert Kennedy, Jr., an early Obama backer;

-- Solar Reserve, which got a $737 million loan, and whose major investor is a company run by Michael Froman, who was a deputy assistant to the president. Froman bundled up to $500,000 for the president's 2008 campaign;

-- Granite Reliable Wind Generation, which received a $168.9 million loan. The company's majority owner is a firm formerly led by Nancy Ann DeParle, now a White House deputy chief of staff and former head of the president's health care communications team during the reform debate; and

-- Abound Solar, which received a loan guarantee worth $400 million. A key investor is billionaire heiress Pat Stryker, who gave $87,000 to Obama's inauguration committee, and hundreds of thousands more to Democratic causes.

Read more: http://www.foxnews.com/politics/2011/11/16/solyndra-case-reveals-gateway-between-administration-loans-obama-allies/#ixzz1fUqe7CB0

Peter Schweizer, author of "Throw Them All Out", wrote that at least 10 members of Obama's finance committee and more than a dozen of his campaign bundlers took money from administration loan programs.

Secretary Chu approved the Solyndra loan in September 2009. The braniac Nobel prize winner in Physics, testified that he was "not aware" of staffers predictions that Solyndra would go broke and run out of cash by September 2011. He clearly missed the the Office of Management and Budget recommendation that the deal be "notched down". At Solyndra's groundbreaking he announced, "If you build a better solar panel, the world will beat a path to your door."

In March 2010, PricewaterhouseCooppers warned that Solyndra's recurring losses and negative cash flows" raise a substantial doubt about it's ability to continue as a going concern". Chu remained a booster for the project. In May 2010, President Obama appeared at a Solyndra event and proclaimed," the true engine of economic growth will always be companies like Solyndra."

By October, Solyndra CEO Brain Harrison informed the DOE that the company was about to lay off workers. The company shut one of its plants and laid off 40 workers the day after the November elections.
Secretary Chu admits he approved a  to put $75 million into Solyndra which included a sweetener that put investors ahead of taxpayers in the payback line that follows bankruptcy. This gambit failed and Solyndra laid off 1,000 workers.

The Nobel prize winner's pet pick was a bust. No scandal? In February 2009, the former Solyndra CEO Chris Gonet set 10 conditions for the Administration to meet to help Solyndra raise an additional $147 million.

No.9. "Fundraising suppport after conditional commitment: Steven Chu visits Solyndra with press interviews (target by end of March)."

Solyndra Scandal key Players

Methane Hydrates World Map

Methane hydrates occur in polar permafrost regions and marine outer continental margins and represent a potentially enormous energy resource.

Hydrates are naturally occurring crystalline compounds of natural gas enclosed within a cage-like lattice of water ice. Chemists call such structures clathrates. In methane hydrates, water crystallizes in the cubic system, rather than in the hexagonal structure of normal ice. The resulting compound packs a lot of methane in its dense organization. One cubic foot of hydrate contains about 164 cubic feet of methane gas.

With adequate gas concentrations, methane hydrates form and are stable under moderate- to high pressure, low temperature conditions. This Methane Hydrate Stability Zone (MHSZ) typically occurs: 1) on continental margins at water depths greater than about 300 m and bottom water temperatures close to 0° C, where gas hydrate is found from the sediment surface to depths of about

1100 m below the seafloor, and 2) in polar continental regions, where gas hydrate can be present in sediment and permafrost at depths between about 150 and 2000 m.

Early estimates of the total resource were as speculative as they were impressive. Current work using geology-based Total Petroleum System (TPS) assessments still yields very large numbers.

The USGS recently estimated that there are about 85.4 trillion cubic feet (Tcf) of undiscovered, technically recoverable gas resources within methane hydrates in northern Alaska alone (Collett, 2009). The Minerals Management service conducted an evaluation of the petroleum system for the Gulf of Mexico and estimated a mean value of 21,444 Tcf with 6,717 Tcf in place in sandstone reservoirs

(Frye, 2008). Mean estimated resource of domestic methane hydrate in place is about 200,000 Tcf (NETL, site accessed 4/28/11).

Source

Two primary source mechanisms have been recognized based on carbon and hydrogen isotopic analysis (Uchida, et al, 2009): microbial decay of organic matter within the gas-hydrate stability zone and thermogenic methane. Thermogenic methane may migrate from thermally mature, deep-seated organic shales, or by leakage from deeper, conventional free gas reservoirs (Lorenson, 2011).

Reservoir

An important difference between methane hydrate accumulations and more conventional gas fields is the nature of the reservoir beds containing the gas: methane hydrate deposits occur in young, relatively unconsolidated sediments where the ice-like hydrate structure holds the gas in place. Methane hydrates occur within a range of reservoir facies, from mudstones to gravels. Sandy siliciclastic reservoirs are considered to be the most favorable for commercial exploitation.

Seal

The seal is provided by the clathrate structure itself. In fact, it is increasingly recognized that the hydrate accumulations may provide a top and lateral seal for deeper free-gas reservoirs outside the methane hydrate stability zone (MHSZ).

Trap

The trapping mechanism, too, is attributed to the arrangement of methane within the clathrate structure. As free gas migrates into the MHSZ, it is chemically trapped within the crystalline configuration of the naturally formed clathrate.

( from Search & Discovery #80193)

Anadarko 's Mozambique 10 TFC Discovery

• Barquentine-2 was drilled to a total depth of 13,500 feet in Offshore

Area 1 (APC WI 36.5%) of the Rovuma Basin in a water depth of

approximately 5,400 feet. The well encountered more than 230 net feet

of high-quality gas sand in static communication with the Barquentine-1

well, located 2 miles to the northwest. The entire reservoir section was

cored and will be used to help optimize the development plan for the

area. The Barquentine-2 wellbore has been temporarily abandoned and

will be used in a testing program in early 2012.

• Subsequent to quarter end, Anadarko announced the results of the

Camarão-1 well. The appraisal section of the well encountered

approximately 240 net feet of natural gas pay in an excellent-quality

reservoir and confirmed static pressure connectivity with previously

announced discoveries at Windjammer and Lagosta. The well also

discovered approximately 140 net feet of natural gas pay in shallower

Miocene and Oligocene sand packages. The well was drilled to a total

depth of 12,630 feet in water depths of approximately 4,730 feet. The

Camarão well has been saved and will be used in the upcoming DST

program.

• Based upon the five successful penetrations in the complex to

date, the confirmed static pressure connectivity and the numerous

cores that have been analyzed, the company has a high level

of confidence that the Windjammer, Barquentine and Lagosta

complex holds in excess of 10 trillion cubic feet of recoverable

natural gas resources. Given the increased recoverable resource

base potential of this complex, initial development plans have

been expanded to a minimum of two 5-million-tonne-per-annum

LNG trains with the flexibility to develop additional trains based

upon continued exploration and appraisal success. Once the

first two trains are constructed, this infrastructure is expected

to provide economies of scale that can significantly reduce

expansion costs for additional trains.

• The Barquentine-3 appraisal well is currently being drilled and

the rig will continue to drill appraisal wells through the end of

2011. The company is in the process of mobilizing a second rig

to Mozambique late in 2011 to conduct an extensive reservoir

testing program and up to seven exploration/appraisal wells

during the next 12 months.