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Faces of Fracking – Ed Ruszel of Benicia, California

Repost from Faces of Fracking
[Editor – This is much more than a story about our friend Ed Ruszel.  Author Tara Lohan packs background and detail into this piece like a great storyteller.  Another MUST READ, including almost everything you need to know about crude by rail in Benicia….  (This story also appears on Grist and DeSmogBlog.)  – RS]

Faces of Fracking

Stories from the front lines of fracking in California

Ed Ruszel
Ed Ruszel’s family business is in an industrial park in Benicia, CA, where Valero Energy is hoping to build a new rail terminal at its refinery to accept 70,000 barrels of crude oil a day. (Sarah Craig)

“Business by the Rails” by Faces of Fracking, CC BY-NC-ND 4.0

Ed Ruszel

Story by Tara Lohan | Photography by Sarah Craig

Ed Ruszel’s workday is a soundtrack of whirling, banging, screeching — the percussion of wood being cut, sanded, and finished. He’s the facility manager for the family business, Ruszel Woodworks. But one sound each day roars above the cacophony of the woodshop: the blast of the train horn as cars cough down the Union Pacific rail line that runs just a few feet from the front of his shop in an industrial park in Benicia, California.

Most days the train cargo is beer, cars, steel, propane, or petroleum coke. But soon two trains of 50 cars each may pass by every day carrying crude oil to a refinery owned by neighboring Valero Energy. Valero is hoping to build a new rail terminal at the refinery that would bring 70,000 barrels a day by train — or nearly 3 million gallons.

And it’s a sign of the times.

Crude by rail has increased 4,000 percent across the country since 2008 and California is feeling the effects. By 2016 the amount of crude by rail entering the state is expected to increase by a factor of 25. That’s assuming industry gets its way in creating more crude by rail stations at refineries and oil terminals. And that’s no longer looking like a sure thing.

Valero’s proposed project in Benicia is just one of many in the area underway or under consideration. All the projects are now facing public pushback — and not just from individuals in communities, but from a united front spanning hundreds of miles. Benicia sits on the Carquinez Strait, a ribbon of water connecting the San Pablo and Suisun Bays in the northeastern reaches of the San Francisco Bay Area. Here, about 20 miles south of Napa’s wine country and 40 miles north of San Francisco, the oil industry may have found a considerable foe.

The Geography of Oil

The heart of California’s oil industry is the Central Valley — 22,500 square miles that also doubles as the state’s most productive farmland. Oil that’s produced here is delivered to California refineries via pipeline. For decades California and Alaska crude were the main suppliers for the state’s refineries. Crude came by pipeline or by boat. Over the last 20 years imports from places like Saudi Arabia, Ecuador, and Iraq have outpaced domestic production. But a recent boom in “unconventional fuels” has triggered an increase in North American sources in the last few years. This has meant more fracked crude from North Dakota’s Bakken shale and diluted bitumen from Alberta’s tar sands.

A Union Pacific train engine is parked in front of the Valero refinery in Benicia, CA. Union Pacific has the final say over the logistics of trains arriving to the refinery. (Sarah Craig)

            “Union Pacific Train” by Faces of Fracking, CC BY-NC-ND 4.0

Unit trains are becoming a favored way to help move this cargo. These are trains in which the entire cargo — every single car — is one product. And in this case that product happens to be highly flammable.

This is one of the things that has Ed Ruszel concerned. He doesn’t think the tank cars are safe enough to transport crude oil (or ethanol, which is also passing through his neighborhood) in the advent of a serious derailment.

But he’s also concerned not just with the kind of cargo, but the sheer volume of it. If a derailment occurs on a train and every single car (up to 100 cars long) is carrying volatile crude, the dangers increase exponentially. The more trains on the tracks, the more likely something could go wrong. In 2013, more crude was spilled in train derailments than in the prior three decades combined, and there were four fiery explosions in North America in a year’s span.

This risk Marilaine Savard knows well. I met her in February of 2014 when she visited the Bay Area to tell residents about what happened in her town of Lac Megantic, Quebec. The closest word to describe the experience was “apocalypse,” she said, through tears.

Most people by now know of the train derailment that killed 47 people and incinerated half of Lac Megantic’s downtown in the wee hours of the morning on July 7, 2013. The fire was so hot the city burned for 36 hours. Even the lake burned.

We now have term for this: bomb train.

Traffic Jam

Just two days before the disaster in Lac Megantic, Ed joined a community meeting in Benicia about the Valero project. For many residents, it was the first they were learning of it, but Ed had known months before.

In January 2013 a train carrying petroleum coke leaving Valero’s refinery derailed. It was minor — no cargo spilled — but it did rip up a piece of track, and the stalled train blocked the driveway to Ruszel Woodworks for hours. It was one of three minor derailments in the industrial park in the span of 10 months.

Ed came outside to see what the problem was. “The Valero people told me ‘get used to it, because we’re really going to be bringing in a lot of cars soon,’” Ed says. “At that point I really started paying attention and I got really scared.” Ed soon learned about plans for Valero’s new terminal, the 100 train cars that would pass by his business each day, and that it appeared the city was ready to rubber stamp the project — no Environmental Impact Report required.

The fire was so hot the city burned for 36 hours. Even the lake burned.

To explain one of the reasons for his concern, Ed shows me around his property where the lands comes to a V and two rails lines intersect. The main line of Union Pacific’s track passes along the back of Ed’s property, about 75 feet from his building. Here trains can get off the main line and switch to the local line that runs inside the industrial park. The local track passes by the front of Ed’s property, about 20 feet from the building.

The tracks into the industrial park were not designed for a crude by rail facility, Ed says. There are no loops. For Valero to get crude tanks into the refinery, the train must pass by the back of Ed’s property on the main line, pull all the way forward (usually about a mile), and then back up onto the local line, past the front of Ed’s property and into the refinery. The process is reversed when the train leaves. The 100 train cars a day that Valero hopes to bring in will come by his business up to four times per day.

That’s a concern not just because of potential dangers from derailments and diesel fumes from idling trains, but also because the industrial park has a rail traffic problem.

“My big concern here is specifically with the rails — I realize there are other huge environmental issues and global issues with the kinds of fossil fuel production we’re dealing with now and where it’s going,” Ed says.

Already trains servicing the Valero refinery and other industry neighbors can cause traffic nightmares. The trains block driveways to businesses and sometimes major roadways.  An off ramp from Interstate 680 empties into the industrial park. Ed has photos of cars trying to exit the highway but are backed up on the interstate because of train traffic.

The reason has to do with the area’s history.

The tracks that come through the industrial park were not built for industry, but for the U.S. Army.

From 1851 to 1964, part of the land now claimed as an industrial park was home to the Benicia Arsenal. Bunker doors in the hillsides and buildings from the 1800s are part of the area’s colorful history. The rail lines moved around troops and armaments from the Civil War through the Korean War, Ed says, but it’s ill-suited to servicing a busy commercial rail terminal.

The Public Comments

Ed’s family moved their woodworking business to the industrial park in 1980. His brother Jack and their father started the company when Jack was still in high school, and it’s grown to over 20 employees. They’ve always played nice with the other businesses, including the refinery, which was built in 1968 and bought by Valero in 2000.

Ed Ruszel drives by the Valero Refinery, which is about a mile from his family’s woodworking business in Benicia, CA. (Sarah Craig)
  “Valero’s Refinery” by Faces of Fracking, CC BY-NC-ND 4.0  

But the Ruszels felt the crude by rail issue demanded they take a stand. While not aligned with any local activist groups, Ed and other members of his family have spoken publicly about their concerns.

“In some ways, getting outspoken we feel like we’re sticking our neck out,” Ed says. “There are four generations of my family here in Benicia — I’ve got my 80 year-old mother, tiny little grandnieces and nephews, and they all have to live with it. But it is important enough.”

Their voices are part of a growing chorus in the area.

On May 31, 2013 the City of Benicia issued a Mitigated Negative Declaration, which means an initial study by the city concluded there were no significant environmental problems with the project that couldn’t be mitigated.

But many residents felt differently and commented on the initial study or voiced concerns at a July 9 city planning department meeting, which occurred just two days after the disaster in Lac Megantic drove home the reality of a catastrophic accident.

By August the city sided with concerned residents and decided that a draft Environmental Impact Report (DEIR) needed to be prepared to further review the project. An outside consultant was hired for the job but paid for by Valero. After much delay, the DEIR was released in June 2014 and promptly slammed by everyone from the state’s Attorney General Kamala Harris to the local group Benicians for a Safe and Healthy Community because it left out crucial information and failed to address the full scope of the project.

Even the Sacramento Area Council of Governments, which represents 22 cities in six counties that are “uprail” from the project, weighed in. It noted the draft EIR doesn’t offer any recommendations for safety measures because it concludes there is no “significant hazard.”

“We believe that conclusion is fundamentally flawed, disregards the recent events demonstrating the very serious risk to life and property that these shipments pose, and contradicts the conclusions of the federal government, which is mobilizing to respond to these risks,” the comment states. It even quotes a U.S. Department of Transportation report from May 2014 that says that Bakken crude by rail shipments pose an “imminent hazard.”

One of the biggest omissions in Valero’s DEIR was Union Pacific not being named as an official partner in the project. With the trains arriving via its rail lines, all logistics will come down to the railroad. Not only that, but the federal power granted to railroad companies preempts local and regional authority.

This preemption is one of the biggest hurdles for communities that don’t want to see crude by rail come through their neighborhoods or want better safeguards. An October 2014 editorial in the San Francisco Chronicle lamented, “What’s really crazy is the federal law that allows preemption of municipal and state law when it comes to critical decisions on rail safety. Affected communities deserve a say over what rolls through their towns.” With preemption, that may be impossible.

The DEIR also doesn’t identify exactly what kind of North American crudes would be arriving and from where, deeming it “confidential business information.” Attorney General Kamala Harris called that omission an “overly broad determination of trade secrets.”

Different kinds of crude have different health and safety risks. A pipeline rupture carrying Canadian diluted bitumen in a tributary of the Kalamazoo River in Michigan in 2010 showed that the thick, corrosive crude is much harder (perhaps impossible) to clean up adequately and is different than conventional crude, which sheens on the surface of water. And Bakken crude has proved more explosive than other crudes because of its chemical composition. It’s likely that some of the crude coming to Valero’s refinery would be from either or both sources.

Consider the numbers: In 2013 the total crude by rail brought into California was nearly 6.3 million barrels, and in the first nine months of 2014, the numbers were 4.3 million barrels. The top two sources have been North Dakota and Canada.

Further, the DEIR only examines the risks of a minor derailment along a 69-miles stretch of track between Benicia and Roseville. It doesn’t address the hazards (which could be catastrophic) of the three potential routes that the Union Pacific trains may take entering California, which involve passing over mountains, through tinderbox-dry forests, and along critical water sources.

Just a week ago a train derailed along one such route in the Feather River Canyon. Eleven cars plunged off the track and down the canyon. Had the cargo been crude instead of corn, its contamination could have made its way down the Feather River to Lake Oroville, a reservoir for millions of Californians.

Public comments on the DEIR closed on September 15, and now it’s a waiting game to see what happens next in Benicia. The planning commission will vote on whether to accept or deny the permit for the project. If the commission denies the permit, Valero can appeal to the city council. Either way, it’s likely to end up in court.

Cumulative Impacts

Ed spends his weekdays on land in Benicia and his weekends on the water, sailing out of nearby Richmond. He has shaggy brown hair, a neatly trimmed salt and pepper goatee, and looks every bit the weathered sailor that he is.

Having worked professionally as a boat captain and even as a solo sailor to Hawaii, Ed is a bit overqualified for the nearly windless fall Sunday we set sail with local activist Marilyn Bardet, a member of Benicians for a Safe and Healthy Community.

Ed Ruszel and Marilyn Bardet, an activist with Benicians for a Safe and Healthy Community, sail outside of the Richmond Harbor to investigate the presence of the oil industry along the Bay Area’s shoreline. (Sarah Craig)
  “Richmond Sailing” by Faces of Fracking, CC BY-NC-ND 4.0 

Marilyn has been a refinery watchdog in Benicia for years and worries about more than just the transportation of fossil fuels. “For me it’s not only about whether they were going to bring it by rail, but whether they were going to bring it at all,” she says.

Sailing from Richmond, we get a good perspective of how pervasive the oil industry is in this area. We pass a couple of blue and white docked ships with their decals reading “Marine Spill Response.” Ever since the Exxon Valdez spill in Alaska, Ed explains, the industry pays into a fund that keeps ships at the ready in case of an accident.

No such thing exists for the crude by rail industry. In fact, the National Transportation Safety Board reported in January 2014, “Current regulations do not require railroads transporting crude oil in multiple tank cars to develop comprehensive spill response plans and have resources on standby for response to worst-case discharges.”

Ed points the bow of the boat toward the Long Wharf in Point Richmond where hulking oil tankers sidle up to be unburdened of their cargo.

We also have a clear view of the large terra cotta-colored storage tanks nesting above neighborhoods in the hillsides of Richmond. These are part of the sprawling refinery operations run by Chevron, but first begun by Standard Oil in 1901.

And it’s not the only refinery around here. In the North Bay, there are five along a 20-mile crescent, with Richmond and Benicia being the bookends. In between, Phillips 66 operates a refinery in Rodeo, and two other refineries (Shell and Tesoro) straddle Martinez.

Residents of these towns have joined in the crude-by-rail fights as well — lending their comments to Environmental Impact Reports, attending community meetings, and joining together for “healing walks” between communities.

Oil storage tanks used by the Chevron refinery in Richmond, CA are seen from the water’s edge. A fire at the refinery in 2012 caused thousands of nearby residents to seek medical treatment. (Sarah Craig)
   “Chevron Refinery By the Bay” by Faces of Fracking, CC BY-NC-ND 4.0 

The network of support has even extended hundreds of miles south. The Phillips 66 refinery has two parts — one in Rodeo and the other 200 miles away, just outside the town of Nipomo in San Luis Obispo County. A pipeline joins the operations. The refinery has expansion plans that are currently being reviewed. One part of those plans involves building a new rail unloading facility in Nipomo that would bring in five unit trains of crude a week, with 50,000 barrels per train.

But the crude-by-rail projects in the area don’t end there. In nearby Pittsburgh, 20 miles east of Benicia, residents pushed back against plans from WestPac Energy. The company had planned to lease land from BNSF Railway and build a new terminal to bring in a 100-car unit train each day of crude. But WestPac’s plan has stalled after Attorney General Kamala Harris commented on a recirculated Draft Environmental Impact Report and said the project had “significant legal problems” and “fails to disclose the sources and analyze the environmental impacts of the new crude.”

Further south in Kern County in the heart of oil country, Plains All American just opened a crude-by-rail terminal that is permitted for a 100-car unit train each day. Another nearby project, Alon USA, received permission from the county for twice as much but is being challenged by lawsuits from environmental groups.

Closer to home, though, unit trains are already arriving. In March, an investigation by local TV station KPIX revealed that Kinder Morgan, a “midstream” company which is in the business of transporting crude (usually by pipeline or rail), received a change of use permit for a rail terminal in Richmond. Kinder Morgan had been transporting ethanol, but the Bay Area Air Quality Management District OK’d Kinder Morgan to offload unit trains of Bakken crude into tanker trucks. KPIX journalists followed the trucks to the Tesoro refinery in Martinez, just across the Carquinez Strait from Benicia.

Aimee Durfee is part of the Martinez Environmental Group. Not only is Martinez flanked by two refineries, but it’s also bisected by Union Pacific rail lines. Now, the residents also know that crude is arriving by truck. “We came to understand that we are collateral damage,” she said. “We get it coming and going.”

Aimee says her group’s biggest fear is the threat of derailment and explosion. The same is true for many Richmond residents near Kinder Morgan’s rail terminal.

“The permit was given illegally by the air district, without concern for the health and safety of the community,” says Andres Soto, an organizer with Communities for a Better Environment. “Should there be a catastrophic explosion — there are residences and two elementary schools across the street from the railyard.” He also says that the blast zone in Richmond contains a total of 27 schools. The blast zone is defined as a half mile away for evacuations if there is a derailment and one mile away if there is an explosion and fire.

Train cars are parked at the Kinder Morgan rail facility in Richmond, CA. The facility is currently permitted to offload Bakken crude from unit trains. (Sarah Craig)
  “Rail Terminal” by Faces of Fracking, CC BY-NC-ND 4.0 

Earthjustice, a nonprofit that litigates on behalf of environmental causes, has led legal efforts trying to block the permit for Kinder Morgan, but in September, Judge James Bush threw out the suit because it was not filed within 180 days of the permit issuance. (The catch-22 of course being that it hadn’t been filed in the proper window of time because no one knew it had even happened, since public notice was not given.)

Earthjustice has appealed Judge Bush’s decision, but residents are continuing to fight the permit in other ways. On October 28, the Richmond City Council unanimously passed a resolution calling on the Bay Area Air Quality Management District to review and “if feasible, revoke the permit and subject the project to a complete CEQA process,” which would be a full environmental review.

The Big Picture

With all this crude by rail activity, some big picture thinking would be helpful. As Attorney General Kamala Harris wrote about the Benicia project, “There’s no consideration of cumulative impacts that could affect public safety and the environment by the proliferation of crude-by-rail projects proposed in California.”

Ed has come to a similar understanding. He is focused on the trains passing by his shop, but the process has opened his eyes to a lot more. He’d heard about the impacts of tar sands and Bakken crude but didn’t have a personal connection to it until unit trains began arriving in California.

“Just focusing on what’s happening in my little neck of the woods has led me to spend more time really looking at the big picture,” he said. “The climate is rapidly changing for one reason or another and probably a good portion of it is what we’re doing with the burning of fossil fuels and so forth, especially this rapid extraction.

“I can’t go to New York and demonstrate or deal with the Keystone XL pipeline, but we can look around here, keep our eyes open, and try to articulate what we’re seeing locally,” says Ed.

First Phase of Global Fracking Expansion: Ensuring Friendly Legislation

Repost from Inter Press Service
[Editor: Significant quote: “’Under pressure from the fossil fuel industry – which has deep pockets and promises employment and investment – several governments have already started to weaken their environmental legislation, alter their tax regimes and put in place industry-friendly mining licensing and production processes, in order to attract foreign investors and expertise….’”  See especially U.S. government promotion below.  – RS]

First Phase of Global Fracking Expansion: Ensuring Friendly Legislation

By Carey L. Biron
Fracking fluid and other drilling wastes are dumped into an unlined pit located right up against the Petroleum Highway in Kern County, California. Credit: Sarah Craig/Faces of Fracking
Fracking fluid and other drilling wastes are dumped into an unlined pit located right up against the Petroleum Highway in Kern County, California. Credit: Sarah Craig/Faces of Fracking

WASHINGTON, Dec 1 2014 (IPS) – Multinational oil and gas companies are engaged in a quiet but broad attempt to prepare the groundwork for a significant global expansion of shale gas development, according to a study released Monday.

Thus far, the hydraulic fracturing (or “fracking”) technologies that have upended the global gas market have been used primarily in North America and, to a lesser extent, Europe. With U.S. gas production in particular having expanded exponentially in recent years, however, countries around the world have started exploration to discern whether they, too, could cash in on this new approach.

According to an estimate published last year by the U.S. Energy Information Administration, some 90 percent of the world’s shale gas could be found outside of the United States – an incredibly lucrative potential. “It’s likely there will be a revolution,” Maria van der Hoeven, the executive director at the Paris-based International Energy Agency, has said.

Yet according to the new study, from Friends of the Earth Europe, a watchdog group, only Brazil has strengthened its regulatory regime in anticipation of this expansion. Of the nearly dozen countries the new report looks at, most are doing the opposite.

“Under pressure from the fossil fuel industry – which has deep pockets and promises employment and investment – several governments have already started to weaken their environmental legislation, alter their tax regimes and put in place industry-friendly mining licensing and production processes, in order to attract foreign investors and expertise,” the report states. “This is often at the expense of the public interest.”

In terms of production this remains a nascent industry. Nonetheless, neither governments nor companies appear to have undertaken efforts to guard against the complexities that will arise, including around the potential for social, environmental and even political tensions.

“The industry is trying to change the legislation in those places where they want to operate, to try to repeat as much as possible the favourable policies we’ve seen in U.S. energy policy,” Antoine Simon, a shale gas campaigner with Friends of the Earth Europe and lead author on the new report, told IPS.

“The key here is to ensure that the legal frameworks are as friendly for the industry as possible. That’s the first phase of this global strategy, and we’re seeing it in each country we studied.”

No safeguards

Outside of North America and Europe, Argentina has moved forward the quickest on shale gas development, and thus offers a key example on legislative action for which companies may be looking.

For instance, Argentina has put in place a new law guaranteeing a minimum price for fracked gas. Further, this minimum price is some 250 percent higher than the previous valuation – a sweetheart guard against the bottomed-out prices that are currently impacting on gas production in the United States.

Simon says this law has a telling nickname in Argentina – the “Chevron Decree”, a reference to the U.S. oil and gas company. The day after the law was passed, he notes, Argentina’s main state-backed oil and gas producer signed a long-term production deal with Chevron.

Other countries have put in place favourable new tax policies for oil and gas investors. In Morocco, for instance, producers will be exempt from corporate taxes for the first decade of operation, while Russia has created similar policies for oil production over the next 15 years.

Yet the lack of action to simultaneously put in place environmental or social safeguards in most countries runs a variety of risks, Friends of the Earth Europe and others warn. Hydraulic fracturing requires massive amounts of water, for instance – up to 26 million litres per drill site.

The new report finds that a significant proportion of shale gas reserves around the world are located in areas that are already experiencing significant water shortages and even related violence. Likewise, many of these shale basins are beneath major cross-border aquifers.

Even before these issues are addressed by national governments, then, the oil and gas industry could gain influence in setting policy on the notoriously contentious issue of freshwater use.

Alongside concerns about the local impact of shale gas development is a broader lack of clarity today on the extent to which developing countries would be able to benefit from any new gas-related revenues. Thus far, only Brazil has specifically addressed this issue.

“In our research, Brazil was the only exception in terms of passing legislation that ensured they would get some significant revenues,” Simon says. “Really that doesn’t seem to be happening in other countries, where instead we’re seeing a lot of legislation that offers state aid to push investors to come to their countries.”

Beyond a few notable exceptions in Latin America and South Africa, Simon suggests that this issue has not yet seen significant opposition by civil society. Still, advocacy groups do point to a growing trend of global understanding and mobilisation on fracking concerns.

“As more and more studies confirm the risks of air pollution, water contamination, increased earthquake activity and climate change impacts from fracking, the more people oppose this destructive and intensive process,” Wenonah Hauter, the executive director of Food & Water Watch, a U.S. watchdog group, told IPS.

“The movement to ban fracking has resulted in hundreds of local communities taking action to stop fracking, several states and countries instituting moratoriums, and the movement continues to grow.”

In October, Food & Water Watch organized an international day of action to ban hydraulic fracturing. Hauter notes that the event featured “over 300 actions in 34 countries, from Australia to Argentina, even Antarctica, calling for a ban on fracking”.

Food & Water Watch reports that France and Bulgaria have already banned hydraulic fracturing, while local moratoriums have also been passed by hundreds of communities across the Netherlands, Spain and Argentina.

U.S. government promotion

Meanwhile, the drivers behind fracking-related pressures are not simply multinational companies and national governments keen on investment. It was in the United States where hydraulic fracturing was invented and proved its potential, and today the U.S. government is reportedly taking a central role in promoting these techniques worldwide.

In almost all of the countries studied for the new report, researchers found the development of shale gas to be “closely linked” to a U.S. government agency, the U.S. Unconventional Gas Technical Engagement Program (UGTEP). Housed within the U.S. State Department, since 2010 the UGTEP has engaged in a wide variety of technical assistance around gas development.

“Governments often have limited capability to assess their own country’s unconventional gas resource potential or are unclear about how to develop it in a safe and environmentally sustainable manner,” UGTEP explains on its website. “The ultimate goals of UGTEP are to achieve greater energy security by supporting the development of environmentally and commercially sustainable frameworks.”

While U.S. diplomats are specifically tasked with strengthening U.S. business prospects abroad, critics say UGTEP’s activities constitute the broad promotion of hydraulic fracturing under the guise of U.S. diplomacy.

“UGTEP uses official government channels and US taxpayers’ money to promote high-volume horizontal hydraulic fracturing worldwide, opening doors for the main global players in the oil and gas industry,” the Friends of the Earth Europe report states.

“Through UGTEP, the US is also actively engaged in re-shaping existing foreign legal regulations to create the desired legal framework for the development of shale oil and gas in the targeted countries.”

Edited by Kitty Stapp

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]

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.

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