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Government Cannot Halt Oil Incentives, Judge Rules
Edmund L. Andrews, New York Times
A federal judge in Louisiana handed the oil industry a major legal victory this week, saying the government had no authority to suspend billions of dollars’ worth of drilling incentives when energy prices were high.
If upheld, the ruling could free companies from paying the government up to $60 billion in royalties for oil and gas produced in publicly owned waters of the Gulf of Mexico.
(2 November 2007)
Tapped Out, but Hopeful: A Break in Texas’s Oil Decline
Clifford Krauss, New York Times
CRANE, Texas – The North McElroy oil field here in West Texas has long been a tableau of rusty tanks and worn-out pump jacks. “Not in Use” is painted across broken electrical panels affixed to an abandoned building.
With oil prices setting records, years of neglect finally appear to be coming to an end. The Apache Corporation is drilling new wells. Workers are flocking to sparsely populated West Texas, living in motels and trailer parks. Dishwashers and teachers are fleeing their jobs for $60,000 gigs in the fields.
But for all the new wealth and activity, the best the industry can hope to accomplish is to slow the decline of American oil production. The good times here are not nearly as good as they were in the last big oil boom in the 1970s and 1980s – and nobody expects they will get that way, how ever high prices rise.
(2 November 2007)
Exxon’s Crude Nightmare
Evelyn M. Rusli,, Forbes
The odd dynamic of expensive crude oil and weak gasoline prices, is turning into an ugly headache for Exxon Mobil.
On Thursday, the giant energy company, said profits fell 10.3% to $9.4 billion, or $1.70 a share, from $10.5 billion, or $1.77 a share, for the year-ago period.
…Like other oil refiners, Exxon Mobil has been battered by high crude prices because gasoline prices have not risen proportionately…. With oil hurtling toward the $100 mark–amid low supplies and political tension in the Middle East–refiners may not get a break in the near future
(1 November 2007)
Related: Exxon Profits Drop 10% (Business Week)
Is Drilling Method Making People Ill?
David Ivanovich, Houston Chronicle
Is a common oil and gas drilling technique making people ill?
A House panel Wednesday grappled with concerns that chemicals used in ‘hydraulic fracturing,’ a process to boost oil and gas production, could pollute nearby drinking water or be released into the air and sicken local residents.
‘Oil and gas companies can pump hundreds of thousands of gallons of fluid — containing any number of toxic chemicals — into sources of drinking water with little or no accountability,’ said Rep. Henry Waxman, D-Calif., chairman of the Oversight and Government Reform Committee.
In hydraulic fracturing, a mixture of water, sand and chemicals is injected into a well at high pressure to crack underground rock formations and allow trapped oil or — more typically — natural gas to escape. The technique is commonly used in coal bed methane, shale and tight sand fields, where getting to the hydrocarbons can be difficult.
(31 October 2007)
Related: Oil, gas sites blamed for health woes (Denver Post)
“Enviros, Energy Firms Clash Over Pollution Laws (USA TODAY)