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First person account: New Bakken volatility standards are pointless

Repost from The Star Tribune, Minneapolis/St. Paul MN
[Editor: Author Lisa Westberg Peters writes with a personal style that is engaging and informative: “I’ve seen Bakken crude oil as it comes out of the ground. It was surprising in several ways: It was almost green, quite fluid and downright fizzy with natural gases. It’s the high gas content that makes Bakken shale oil so explosive.”  – RS]

New Bakken volatility standards are pointless

Lisa Westberg Peters, December 15, 2014
The explosion risk still exists, which emboldens pipeline supporters — but why must our choices be so dismal?
A large swath of Lac-Mégantic, Quebec, was destroyed and 47 people were killed in July 2013 when a train carrying Bakken crude oil derailed, sparking several explosions and forcing the evacuation of up to 1,000 people. Photo: Paul Chiasson • The Canadian Press/AP

I’ve seen Bakken crude oil as it comes out of the ground. It was surprising in several ways: It was almost green, quite fluid and downright fizzy with natural gases. It’s the high gas content that makes Bakken shale oil so explosive.

When the state of North Dakota established new limits on vapor pressure last week for the oil shipped out of the state, my first reaction was relief. Flammable liquids with lower vapor pressures are less volatile. We’ve seen several explosive rail accidents in recent years involving Bakken oil; an oil train derailment last year in the small Quebec town of Lac-Mégantic killed 47 people and flattened its downtown. I was pleased that regulators were addressing this problem.

But when I took a closer look at the numbers, I felt more dismay than relief. Even if oil producers exceed the regulators’ demands — and regulators say they often do — Bakken crude will still be explosive.

The appropriate comparison seems to be gasoline.

Lynn Helms, head of the North Dakota Department of Mineral Resources, said the new vapor pressure standard of 13.7 pounds per square inch (psi) would make Bakken crude no more volatile than the gasoline we put in our cars every day.

In March, an investigation by the Transportation Safety Board of Canada concluded that the Bakken oil in rail cars at Lac-Mégantic was “as volatile as gasoline,” but the vapor pressure was measured at 9 to around 9.5 psi. In other words, the Bakken crude that exploded in Lac-Mégantic was less volatile than what North Dakota regulators are demanding now, and it still exploded.

In a New York Times article last week [North Dakota Regulators Tell Producers to Filter Crude Oil of Flammable Liquids], Clifford Krauss reported: “Once the rules are in force early next year, transported North Dakota crude oil will have a similar volatility to that of automobile gasoline, which should decrease the risk and size of any fire that might occur once a rail car is punctured in an accident, according to state regulators.” His story never mentioned the findings of the Canadian government.

Why wasn’t this New York Times reporter more skeptical of the assurances of North Dakota oil regulators, especially after the recent New York Times revelations about the leniency of regulators toward the oil industry?

The new vapor pressure standard announced last week is pointless. We will still face danger from exploding oil trains.

This disturbing fact tends to encourage pipeline supporters. Pipelines are safer, they say. In the past, oil transported by pipelines has tended not to explode and kill people; instead it spills and contaminates streams, lakes and aquifers. If you value people’s lives over clean water supply, in the short term, pipelines seem better.

But why do we have to make such lousy choices to keep our domestic energy boom rolling — to keep workers working and our dream of energy independence alive? Let’s do everything we can to encourage the other domestic energy boom, the wind and solar boom, that has already begun and that survives today despite many obstacles, including national policies that still encourage fossil fuel, yesterday’s energy source. If we were to place a price on carbon tomorrow, we would not need as many pipelines and we would be able to reduce the number of oil trains passing through our neighborhoods.

Climate experts urge us to leave much of the world’s remaining fossil fuel, including Bakken crude, in the ground. If we do as they advise, we will disrupt job markets and be forced to rethink the way we do almost everything. Why should we voluntarily face such disruption? One very good reason: We already face the prospect of pervasive disruption posed by a changing climate. It’s far preferable to take well-designed and systematic measures to control disruption than let disruption control us.

Lisa Westberg Peters is the author of “Fractured Land: The Price of Inheriting Oil” (Minnesota Historical Society Press, 2014). She lives in Minneapolis with her family.
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    New York Times: Where Oil and Politics Mix (Part 2)

    Repost from The New York Times
    [Editor:  Part 2 in a series (See Part 1).  This is an INCREDIBLE expose of political corruption and a masterful portrayal of the transformation taking place in North Dakota, where residents and business people are losing confidence in the oil boom promises they once embraced.  Due to it’s GORGEOUS and informative interactive imagery, the Benicia Independent can only repost the beginning of this lengthy and immersive article.  Get started here, then click on MORE.  – RS]

    Where Oil and Politics Mix

    After an unusual land deal, a giant spill and a tanker-train explosion, anxiety began to ripple across the North Dakota prairie.
    By DEBORAH SONTAG, NOV. 23, 2014

    NYT_Where-oil-and-politics-mix(675)TIOGA, N.D. — In late June, as black and gold balloons bobbed above black and gold tables with oil-rig centerpieces, the theme song from “Dallas” warmed up the crowd for the “One Million Barrels, One Million Thanks” celebration.

    The mood was giddy. Halliburton served barbecued crawfish from Louisiana. A commemorative firearms dealer hawked a “one-million barrel” shotgun emblazoned with the slogan “Oil Can!” Mrs. North Dakota, in banner and crown, posed for pictures. The Texas Flying Legends performed an airshow backlit by a leaping flare of burning gas. And Gov. Jack Dalrymple was the featured guest.

    Traveling through the “economically struggling” nation, Mr. Dalrymple told the crowd, he encountered many people who asked, “Jack, what the heck are you doing out there in North Dakota?” to create the fastest-growing economy, lowest unemployment rate and (according to one survey) happiest population.

    Gov. Jack Dalrymple with Janelle Steinberg, Mrs. North Dakota, at a celebration in Tioga in June for reaching a milestone: one million daily barrels of oil. | Paul Flessland
     

    “And I enjoy explaining to them, ‘Yes, the oil boom is a big, big help,’ ” he said.

    Outsiders, he explained, simply need to be educated out of their fear of fracking: “There is a way to explain it that really relaxes people, that makes them understand this is not a dangerous thing that we’re doing out here, that it’s really very well managed and very safe and really the key to the future of not only North Dakota but really our entire nation.”

    Tioga, population 3,000, welcomed North Dakota’s first well in 1951, more than a half-century before hydraulic fracturing liberated the “tight oil” trapped in the Bakken shale formation. So it was fitting that Tioga ring in the daily production milestone that had ushered the Bakken into the rarefied company of historic oil fields worldwide.

    But Tioga also claims another record: what is considered the largest on-land oil spill in recent American history. And only Brenda Jorgenson, 61, who attended “to hear what does not get said,” mentioned that one, sotto voce.

    The million-barrel bash was devoid of protesters save for Ms. Jorgenson, a tall, slender grandmother who has two wells at her driveway’s end and three jars in her refrigerator containing blackened water that she said came from her faucet during the fracking process. She did not, however, utter a contrary word.

    “I’m not that brave (or stupid) to protest among that,” she said in an email afterward. “I’ve said it before: we’re outgunned, outnumbered and out-suited.”

    North Dakotans do not like to make a fuss. Until recently, those few who dared to challenge the brisk pace of oil development, the perceived laxity of government oversight or the despoliation of farmland were treated as killjoys. They were ignored, ridiculed, threatened, and paid settlements in exchange for silence.

    But over the past year and some, the dynamic seemed to be shifting.

    Satellite photos of western North Dakota at night, aglitter like a metropolis with lighted rigs and burning flares, crystallized its rapid transformation from tight-knit agricultural society to semi-industrialized oil powerhouse. Proposals to drill near historic places generated heated opposition. The giant oil spill in Tioga in September 2013 frightened people, as did the explosion months later of a derailed oil train, which sent black smoke mushrooming over a snowy plain.

    The engine of an oil train that derailed and exploded in a collision near the governor’s hometown, Casselton, in December 2013. | Jim Wilson/The New York Times

    Then, this year, North Dakotans learned of discovery after discovery of illegally dumped oil filter socks, the “used condoms” of the oil industry, which contain radiation dislodged from deep underground.

    Suddenly a percolating anxiety came uncorked. “The worm is turning,” Timothy Q. Purdon, the United States attorney, said in April.

    It was against this backdrop that on a brisk spring day David Schwalbe, a retired rancher, and his wife, Ellen Chaffee, a former university president, walked headlong into the wind on their way to an F.B.I. office in Fargo….  [Editor:  MORE – click here to continue – GREAT INTERACTIVE GRAPHICS, DON’T MISS THIS – RS]

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      New York Times: The Downside of the Boom (Part 1)

      Repost from The New York Times
      [Editor: This is an INCREDIBLE, intimate portrait of the lives and times of those living through the nightmare of the crude oil boom in North Dakota.  Due to it’s GORGEOUS and informative interactive imagery, the Benicia Independent can only repost a small portion of this lengthy and immersive article.  Get started here, then click on MORE.  – RS]

      The Downside of the Boom

      North Dakota took on the oversight of a multibillion-dollar oil industry with a regulatory system built on trust, warnings and second chances.
      By DEBORAH SONTAG and ROBERT GEBELOFF NOV. 22, 2014

      NYT The Downside of the BoomWILLISTON, N.D. — In early August 2013, Arlene Skurupey of Blacksburg, Va., got an animated call from the normally taciturn farmer who rents her family land in Billings County, N.D. There had been an accident at the Skurupey 1-9H oil well. “Oh, my gosh, the gold is blowing,” she said he told her. “Bakken gold.”

      It was the 11th blowout since 2006 at a North Dakota well operated by Continental Resources, the most prolific producer in the booming Bakken oil patch. Spewing some 173,250 gallons of potential pollutants, the eruption, undisclosed at the time, was serious enough to bring the Oklahoma-based company’s chairman and chief executive, Harold G. Hamm, to the remote scene.

      It was not the first or most catastrophic blowout visited by Mr. Hamm, a sharecropper’s son who became the wealthiest oilman in America and energy adviser to Mitt Romney during the 2012 presidential campaign. Two years earlier, a towering derrick in Golden Valley County had erupted into flames and toppled, leaving three workers badly burned. “I was a human torch,” said the driller, Andrew J. Rohr.

      Blowouts represent the riskiest failure in the oil business. Yet, despite these serious injuries and some 115,000 gallons spilled in those first 10 blowouts, the North Dakota Industrial Commission, which regulates the drilling and production of oil and gas, did not penalize Continental until the 11th.

      In 2011, Andrew J. Rohr and two other workers were badly burned when a towering derrick erupted into flames and toppled. “I was a human torch,” Mr. Rohr said. | Rich Addicks for The New York Times
       

      The commission — the governor, attorney general and agriculture commissioner — imposed a $75,000 penalty. Earlier this year, though, the commission, as it often does, suspended 90 percent of the fine, settling for $7,500 after Continental blamed “an irresponsible supervisor” — just as it had blamed Mr. Rohr and his crew, contract workers, for the blowout that left them traumatized.

      Since 2006, when advances in hydraulic fracturing — fracking — and horizontal drilling began unlocking a trove of sweet crude oil in the Bakken shale formation, North Dakota has shed its identity as an agricultural state in decline to become an oil powerhouse second only to Texas. A small state that believes in small government, it took on the oversight of a multibillion-dollar industry with a slender regulatory system built on neighborly trust, verbal warnings and second chances.

      In recent years, as the boom really exploded, the number of reported spills, leaks, fires and blowouts has soared, with an increase in spillage that outpaces the increase in oil production, an investigation by The New York Times found. Yet, even as the state has hired more oil field inspectors and imposed new regulations, forgiveness remains embedded in the Industrial Commission’s approach to an industry that has given North Dakota the fastest-growing economy and lowest jobless rate in the country.

      For those who champion fossil fuels as the key to America’s energy independence, North Dakota is an unrivaled success, a place where fracking has provoked little of the divisive environmental debate that takes place elsewhere. Its state leaders rarely mention the underside of the boom and do not release even summary statistics about environmental incidents and enforcement measures.

      Over the past nine months, using previously undisclosed and unanalyzed records, bolstered by scores of interviews in North Dakota, The Times has pieced together a detailed accounting of the industry’s environmental record and the state’s approach to managing the “carbon rush.”

      The Times found that the Industrial Commission wields its power to penalize the industry only as a last resort. It rarely pursues formal complaints and typically settles those for about 10 percent of the assessed penalties. Since 2006, the commission has collected an estimated $1.1 million in fines. This is a pittance compared with the $33 million (including some reimbursements for cleanups) collected by Texas’ equivalent authority over roughly the same period, when Texas produced four times the oil.

      “We’re spoiling the child by sparing the rod,” said Daryl Peterson, a farmer who has filed a complaint seeking to compel the state to punish oil companies for spills that contaminated his land. “We should be using the sword, not the feather.”

      North Dakota’s oil and gas regulatory setup is highly unusual in that it puts three top elected officials directly in charge of an industry that, through its executives and political action committees, can and does contribute to the officials’ campaigns. Mr. Hamm and other Continental officials, for instance, have contributed $39,900 to the commissioners since 2010. John B. Hess, chief executive of Hess Oil, the state’s second-biggest oil producer, contributed $25,000 to Gov. Jack Dalrymple in 2012.

      State regulators say they deliberately choose a collaborative rather than punitive approach because they view the large independent companies that dominate the Bakken as responsible and as their necessary allies in policing the oil fields. They prefer to work alongside industry to develop new guidelines or regulations when problems like overflowing waste, radioactive waste, leaking pipelines, and flaring gas become too glaring to ignore.

      Daryl Peterson taste-tests the residue left by a wastewater spill on land he farms. The highly saline spill rendered the land useless. | Jim Wilson/The New York Times

      Mr. Dalrymple’s office said in a statement: “The North Dakota Industrial Commission has adopted some of the most stringent oil and gas production regulations in the country to enhance protections for our water, air and land. At the same time, the state has significantly increased staffing to enforce environmental protections. Our track record is one of increased regulation and oversight.”

      Researchers who study government enforcement generally conclude that “the cooperative approach doesn’t seem to generate results” while “the evidence shows that increased monitoring and increased enforcement will reduce the incidence of oil spills,” said Mark A. Cohen, a Vanderbilt University professor who led a team advising the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling.

      With spills steadily rising in North Dakota, evidence gathered by The Times suggests that the cooperative approach is not working that well for the state, where the Industrial Commission shares industry oversight with the state’s Health Department and federal agencies.

      One environmental incident for every 11 wells in 2006, for instance, became one for every six last year, The Times found.

      Through early October of this year, companies reported 3.8 million gallons spilled, nearly as much as in 2011 and 2012 combined.

      Over all, more than 18.4 million gallons of oils and chemicals spilled, leaked or misted into the air, soil and waters of North Dakota from 2006 through early October 2014. (In addition, the oil industry reported spilling 5.2 million gallons of nontoxic substances, mostly fresh water, which can alter the environment and carry contaminants.)

      The spill numbers derive from estimates, and sometimes serious underestimates, reported to the state by the industry. State officials, who rarely discuss them publicly, sometimes use them to present a rosier image. Over the summer, speaking to farmers in the town of Antler, Lynn D. Helms, the director of the Department of Mineral Resources, announced “a little bit of good news”: The spill rate per well was “steady or down.” In fact, the rate has risen sharply since the early days of the boom.

      Presented with The Times’s data analysis, and asked if the state was doing an effective job at preventing spills, Mr. Helms struck a more sober note. “We’re doing O.K.,” he said. “We’re not doing great.”

      He noted it is a federal agency, the Pipeline and Hazardous Materials Safety Administration, that regulates oil transmission pipelines. “You can’t use the spills P.H.M.S.A. was responsible for and conclude my approach to regulation is not working,” he said.

      [Editor:  MORE – click here to continue – GREAT INTERACTIVE GRAPHICS, DON’T MISS THIS – RS]

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