Food & Water Watch

How Much Water Does The California Oil Industry Actually Use?

When California Governor Jerry Brown issued mandatory water restrictions for the first time in state history, he notably excluded the agriculture and oil industries from the conservation efforts, a decision that was heavily criticized.

The oil industry, for its part, insists it is a responsible user of water. The Western States Petroleum Association, an oil industry lobbying group, for instance, wrote that “Oil companies are doing their part to conserve, recycle and reduce the water they use to produce oil and refine petroleum products.”

Some perspective is certainly needed here: the amount of water used to produce oil in California is, in fact, dwarfed by the amount used for agriculture. But the thing is, the state can’t make any fully informed decisions about whether or not to include oil development in water cuts because no one knows exactly how much water the California oil industry is using in the first place. That all changes on April 30, however.

Last September, Governor Brown signed into law SB 1281, which requires companies to make quarterly reports to state regulators at the Division of Oil, Gas and Geothermal Resources (DOGGR) detailing the source and volume of water — whether fresh, treated, or recycled — used during oil development processes, including extreme oil extraction methods like fracking, acidization and steam injection. The first set of data required to be reported to DOGGR under SB 1281 is due at the end of the month.

Required reporting on water usage is an important first step in devising an effective water conservation plan for drought-wracked California, Peter Gleick, president of the Pacific Institute, tells DeSmogBlog.

“Without good data, we can’t have good policy,” Gleick says. “And it’s long overdue that the oil industry be transparent about water use and water quality. So I’m looking forward to more transparency.”

“California Crossroads Tour” Calls On Governor Jerry Brown To Ban Fracking

California Governor Jerry Brown recently proposed the most ambitious renewable energy targets in the US, but that does not mitigate his support for the controversial high-intensity oil extraction technique known as hydraulic fracturing (fracking), according to activists who have embarked on a statewide tour to call for the governor to ban the practice.

Organized by Californians Against Fracking—a coalition of environmental and environmental justice groups including 350.org, Food & Water Watch, and the Center on Race, Poverty and the Environment—the “California Crossroads Tour” is aimed at not just ending dangerous oil extraction methods but is also calling on Governor Brown to go even further than he did with his recent proposal to change the state’s Renewable Portfolio Standard from 33% by 2020 to 50% by 2030.

Instead, the activists want Brown to put policies in place that would end the Golden State’s addiction to fossil fuels once and for all.

“California is at a crossroads,” David Braun of Californians Against Fracking and an organizer of the tour said in a press release. “Our governor and our elected officials need to decide if we’re going to be a real leader on climate change, or if we will continue to allow fracking and other dangerous extractions methods that put our communities and environment at risk.”

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.” 

Revealed: Heather Zichal Met with Cheniere Executives as Obama Energy Aide Before Board Nomination

Heather Zichal, former deputy assistant for energy and climate change to President Barack Obama and nominee to sit on the board of directors of LNG export company Cheniere Energy Inc., held two meetings with Cheniere executives while working for the White House. 

White House meeting logs show Zichal attended the meetings with three executives from Cheniere, owner of the Sabine Pass LNG (liquefied natural gas) export facility, the first terminal to receive a final approval from the U.S. Federal Energy Regulatory Commission (FERC) during the hydraulic fracturing (“fracking”) boom.

The meetings appear to have taken place just over two weeks apart from one another, according to the meeting logs. The first meeting was on January 14, 2013, and the second on January 29, 2013. Just over eight months later, Zichal resigned from her White House job, with Reuters citing “plans to move to a non-government job.”

Cheniere CEO Charif Souki — who is facing a major ongoing class-action lawsuit — sat in on both of those meetings. He was joined by Cheniere executives Patricia Outtrim, vice president of governmental and regulatory affairs, and Ankit Desai, vice president of government relations.

Desai, a Cheniere lobbyist, formerly worked with Zichal on U.S. Secretary of State John Kerry's 2004 presidential campaign, serving as his budget director. Desai also formerly served as political director for then-U.S. Senator and now Vice President Joe Biden.


President Barack Obama (L), Heather Zichal (Center), Sec. of State John Kerry (R); Photo Credit: Facebook

Zichal served as Kerry's energy and environment policy adviser for the 2004 campaign and in 2006, became his legislative director, a job she held until becoming policy director for energy, environment and agriculture for President Barack Obama's 2008 presidential campaign

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