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Wed, 2014-11-19 21:05Steve Horn
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Introducing "Natural Gas Exports: Washington's Revolving Door Fuels Climate Threat"

DeSmogBlog's Steve Horn and Republic Report's Lee Fang have co-written an in-depth report on the influence the government-industry revolving door has had on Big Oil's ability to obtain four liquefied natural gas (LNG) export permits since 2012 from the Obama Administration.

Titled “Natural Gas Exports: Washington's Revolving Door Fuels Climate Threat,” the report published here on DeSmogBlog and on Republic Report serves as the launching pad of an ongoing investigation. It will act as the prelude of an extensive series of articles by both websites uncovering the LNG exports influence peddling machine. 

The report not only exposes the lobbying apparatus that has successfully opened the door for LNG exports, but also the PR professionals paid to sell them to the U.S. public. It also exposes those who have gone through the “reverse revolving door,” moving from industry back to government and sometimes back again.

It reveals that many former Obama Administration officials now work as lobbyists or PR professionals on behalf of the LNG exports industry, as do many former Bush Administration officials. So too do those with ties to potential 2016 Democratic Party presidential nominee, Hillary Clinton. 

They include:

Tue, 2014-11-18 19:10Steve Horn
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Gulf-Bound Tar Sands for Export? Follow the Oiltanking Trail

The U.S. Senate failed to get the necessary 60 votes to approve the northern leg of TransCanada's Keystone XL pipeline, but incoming Senate Majority Leader Mitch McConnell (R-Ky.) already promised it will get another vote when the GOP-dominated Senate begins its new session in 2015.

Though the bill failed, one of the key narratives that arose during the congressional debate was the topic of whether or not the tar sands product that may flow through it will ultimately be exported to the global market. President Barack Obama, when queried by the press about the latest Keystone congressional action, suggested tar sands exports are the KXL line's raison d'etre.

Obama's comments struck a nerve. Bill sponsor U.S. Sen. Mary Landrieu (D-La.) and supporter U.S. Sen. John Hoeven (R-ND) both stood on the Senate floor and said Keystone XL is not an export pipeline in the minutes leading up to the bill's failure.

“Contrary to the ranting of some people that this is for export…Keystone is not for export,” said Landrieu, with Hoeven making similar remarks.

But a DeSmog probe into a recent merger of two major oil and gas industry logistics and marketing companies, Oiltanking Partners and Enterprise Products Partners, has demonstrated key pieces of the puzzle are already being put together by Big Oil to make tar sands exports a reality. 

And both Keystone XL and Enbridge's “Keystone XL Clone” serve as key thoroughfares for making it happen.

Sun, 2014-11-16 16:00Steve Horn
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State Department's Keystone XL Contractor ERM Approved Project Now Melting Glaciers

A controversial government contractor once again finds itself in hot water, or in this case, melting glacier water.

TransCanada chose Environmental Resources Management Group (ERM) as one of its contractors to conduct the environmental impact statement for Keystone XL on behalf of the U.S. State Department. ERM Group also happens to have green-lighted a gold mining project in central Asia that is now melting glaciers.

ERM Group has a penchant for rubber-stamping projects that have had tragic environmental and public health legacies. For example, ERM formerly worked on behalf of the tobacco industry to pitch the safety of its deadly product.

A January 2014 study about Keystone XL's climate change impacts published in the journal Nature Climate Change paints a drastically different picture than ERM Group's Keystone XL tar sands study.

The Kumtor Gold Mineowned by Centerra Gold/Cameco Corporation, was provided a stamp of approval from ERM Group in October 2012. Similar to the TransCanada arrangement with the State Department on Keystone XL, Centerra served as the funder of the report evaluating its own project. 

ERM Group Melting Glaciers

“The mine sits at an altitude of 4,000 meters above sea level, in the Tien Shan mountain range and among some of Kyrgyzstan's - and the region's - most important glaciers,” explained an October 28 story published in Asia Times.

“Centerra Gold has consistently dismissed as untrue that operations at Kumtor have had negative implications for the glaciers, which are reportedly melting with observable speed due to years of dumping rock tailings onto the ice sheet. The Canadian company has backed its position with expert evaluations from consultancies such as Environmental Resources Management.” 

Fri, 2014-11-14 09:59Steve Horn
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Former Treasury Secretary Timothy Geithner's Warburg Pincus May Profit from Tar Sands Exports

Several environmental groups have filed a lawsuit against the U.S. Department of State and Secretary John Kerry over the permitting of a controversial border-crossing northern leg of a pipeline system that DeSmogBlog has called Enbridge's “Keystone XL Clone.”

The Keystone XL Clone is designed to accomplish the same goal as TransCanada's Keystone XL: bringing Alberta's tar sands to Gulf coast refineries and export market. It consists of three legs: the Alberta Clipper expansion as the northern leg, the Flanagan South middle leg and the Seaway Twin southern leg.

Green groups have called the northern leg an “illegal scheme” because the Enbridge Alberta Clipper expansion proposal didn't go through the normal State Department approval process. Instead, State allowed Enbridge to add pressure pumps to two separate-but-connected pipelines on each side of the border and send Alberta's diluted bitumen (“dilbit”) to market.

Enbridge dodged a comprehensive State Department environmental review, which involves public hearings and public commenting periods. The groups say this is illegal under the National Environmental Policy Act (NEPA) and have demanded a re-do for Enbridge's application process.

“The only thing worse than dirty oil is dirty oil backed by dirty tricks. This is the fossil fuel equivalent of money laundering,” Kieran Suckling, executive director of the Center for Biological Diversity, said in a press release announcing the lawsuit. “The Obama administration should be ashamed of itself for letting Enbridge illegally pump more dirty tar sands oil into the United States.”

The maneuver has a key beneficiary: former Obama Administration Secretary of the Treasury, Timothy Geithner, who now serves as President of the private equity giant Warburg Pincus.

Geithner's connection to the lawsuit not only adds intrigue, but also reveals the purpose of Enbridge's Keystone XL Clone: an export fast-track to the global market.

Thu, 2014-11-06 13:33Steve Horn
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Bush Family and Its Inner Circle Play Central Role in Lawsuits Against Denton, Texas Fracking Ban

George P. Bush, Texas Land Commissioner-Elect

On November 4, Denton, Texas, became the first city in the state to ban the process of hydraulic fracturing (“fracking”) when 59 percent of voters cast ballots in favor of the initiative. It did so in the heart of the Barnett Shale basin, where George Mitchell — the “father of fracking” — drilled the first sample wells for his company Mitchell Energy.

As promised by the oil and gas industry and by Texas Railroad Commission commissioner David Porter, the vote was met with immediate legal backlash. Both the Texas General Land Office and the Texas Oil and Gas Association (TXOGAfiled lawsuits in Texas courts within roughly 12 hours of the vote taking place, the latest actions in the aggressive months-long campaign by the industry and the Texas state government to fend off the ban.

The Land Office and TXOGA lawsuits, besides making similar legal arguments about state law preempting local law under the Texas Constitution, share something else in common: ties to former President George W. Bush and the Bush family at large.

In the Land Office legal case, though current land commissioner Jerry Patterson signed off on the lawsuit, he will soon depart from office. And George Prescott Bush — son of former Florida Governor and prospective 2016 Republican Party presidential nominee Jeb Bush and nephew of former President George W. Bush — will take his place.

George P. Bush won his land commissioner race in a landslide, gaining 61 percent of the vote. Given the cumbersome and lengthy nature of litigation in the U.S., it appears the Land Office case will have only just begun by the time Bush assumes the office.

The TXOGA legal complaint was filed by a powerful team of attorneys working at the firm Baker Botts, the international law firm named after the familial descendants of James A. Baker III, a partner at the firm.

Baker III served as chief-of-staff under both President Ronald Reagan and President George H.W. Bush, Secretary of State under George H.W. Bush and as a close advisor to President George W. Bush on the U.S. occupation of Iraq. He gave George P. Bush a $10,000 donation for his campaign for his race for land commissioner.

James A. Baker III Campaign Contribution George P. Bush

Photo Credit: Texas Land Commission

The Energy Policy Act of 2005which exempts the oil and gas industry from the Safe Drinking Water Act, the Clean Water Act and the National Environmental Policy Act for fracking, is seen by critics as the legacy of ashes left behind by the George W. Bush Administration.

Yet almost a decade later, the two lawsuits filed against Denton show the Bush oil and gas legacy clearly lives on and stretches from the state where the fracking industry was born all the way to Iraq and back again. 

Mon, 2014-11-03 12:30Steve Horn
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Federal Reserve Policy Keeps Fracking Bubble Afloat and That May Change Soon

In August 2005, the U.S. Congress and then-President George W. Bush blessed the oil and gas industry with a game-changer: the Energy Policy Act of 2005. The Act exempted the industry from federal regulatory enforcement of the Safe Drinking Water Act, the Clean Water Act and the National Environmental Policy Act.

While the piece of omnibus legislation is well-known to close observers of the hydraulic fracturing (“fracking”) issue — especially the “Halliburton Loophole” — lesser known is another blessing bestowed upon shale gas and tight oil drillers: near zero-percent interest rates for debt accrued during the capital-intensive oil and gas production process.

Or put more bluntly, near-free money from the U.S. Federal Reserve Bank. That trend may soon come to a close, as the Federal Reserve recently announced an end to its controversial $3 trillion bond-buying program.

In response to the economic crisis and near collapse of the global economy, the Federal Reserve dropped interest rates to between 0 percent and .25 percent on December 16, 2008, a record low percentage. It also began its bond-buying program, described in a recent Washington Post article as implemented to provide a “booster shot” to the economy.

“The Federal Reserve will employ all available tools to promote the resumption of sustainable economic growth and to preserve price stability,” the Fed stated in a press release announcing the maneuver. “In particular, the [Federal Reserve] anticipates that weak economic conditions are likely to warrant exceptionally low levels of the federal funds rate for some time.”

That free money, known by economics wonks as quantitative easing, helps drilling companies finance fracking an increasingly massive number of wells to keep production levels flat in shale fields nationwide.

But even with the generous cash flow facilitated by the Fed, annual productivity of many shale gas and tight oil fields have either peaked or are in terminal decline. This was revealed in Post Carbon Institute's recently-published report titled, “Drilling Deeper: A Reality Check on U.S. Government Forecasts for a Lasting Tight Oil & Shale Gas Boom.” 

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