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The Epic Rise and Fall of Don Blankenship, former Massey Energy CEO

Three years ago, 29 miners died at the Massey Energy Upper Big Branch mine. It was the worst mining disaster in decades, caused by a methane-fueled blast that was so strong it killed miners more than a mile away and left steel rail lines tangled.

Appalachia has seen its share of these sorts of accidents over the years and normally companies get fined, but mine operators almost never face criminal charges. This time was different.

For the past two years, the U.S. Attorney in West Virginia, R. Booth Goodwin II, has been systematically working his way up Massey’s hierarchy, arguing that beyond the managers who supervised that mine, there was a broader conspiracy led by still unnamed “directors, officers, and agents.” Goodwin has based his prosecutions on conspiracy charges rather than on violations of specific health and safety regulations, which means he can reach further up into the corporate structure. So far, he has convicted four employees including the Upper Big Branch mine superintendent who admitted he disabled a methane monitor and falsified mine records.

But in February, the case took a surprising turn. In pleading guilty to conspiracy charges, Dave Hughart, former President of a Massey subsidiary who is cooperating with the government, said that the person who had alerted him to impending mine inspections was Massey’s CEO, Don Blankenship – an accusation that sent a gasp through the entire coal industry.

Radioactive Waste From the Marcellus Shale Continues to Draw Concern

Amid all the pushback to fracking, most of the attention has focused on what drillers put into the ground. The amount of water used. The chemicals that make up energy companies' secret mix. Whether these dangerous chemicals will contaminate our drinking water. But one of the biggest problems of fracking, indeed, the Achilles heel of this innovative drilling technique that is giving fossil fuels a second lease on life is the waste that comes out of the ground.

How will we handle the massive amounts of toxic waste that each well produces when fracking is used?  Will we dump the millions of gallons of wastewater produced from each well into rivers, pass it through sewage treatment plants, allow it to evaporate in open-faced pits, inject it into the ground at special disposal sites?

One of the reasons these questions are so urgent is that this wastewater is often radioactive. When it was revealed in February, 2011 that Pennsylvania was not only sending millions of gallons of this waste, sometimes with radium levels 3,000 times the safe level, through sewage treatment plants incapable of correct for radioactivity which then discharged into rivers, state officials panicked and denied there was cause for concern.

Faster Drilling, Diminishing Returns in Shale Plays Nationwide?

Today's shale gas boom has brought a surge of drilling across the US, driving natural gas prices to historic lows over the past couple of years. But, according to David Hughes, geoscientist and fellow at the Post Carbon Institute, in the future, we can expect at least the same frenzied rate of drilling – but less and less oil and gas from each well on average.
 
“It’s been a game changer,” Mr. Hughes said of the shale gas boom at a talk last week in Maryland, “but I would say a temporary game changer.”
 
After crunching data from hundreds of thousands of oil and gas wells across the U.S., Mr. Hughes found that just five of the country's 30 best shale plays have been responsible for 80 percent of domestic shale gas production: the Haynesville shale in Louisiana; the Barnett shale in Texas's Fort Worth region; the Marcellus shale, which underlies New York, Pennsylvania, and parts of Maryland and West Virginia; the Fayetteville shale in Arkansas; and Oklahoma's Woodford shale. When it comes to natural gas, all of the other plays pale in comparison to these five regions.
 
But the data reveals that in four of these top five shale-gas plays, drillers have been less and less successful in hitting the next big strike-it-rich well. Average well productivity in four of the five best American shale plays has been falling since 2010, Hughes found. The exception, at least for now, is the Marcellus.
 

Josh Fox's Gasland Part II Faces Aggressive Oil and Gas Public Relations Campaign

It’s coming,” a baritone voice warns as images of a fiery hellscape flash across the screen. “Lies. Deception,” someone whispers, just before the narrator launches into a diatribe about Josh Fox’s new documentary, Gasland Part II, in a youtube clip whose esthetic falls somewhere between b-horror movie and election season attack ad. It’s the sort of video that might be campy if it wasn’t made with an actual budget.

Posted last November under the account energyforamerica, the faux trailer is one of the first hits in a Gasland 2 youtube search.

 “I think it’s kinda unprecedented,” Mr. Fox said after the mock trailer appeared on youtube five months ago. “I don’t know of any other trailer that has attacked a film before even the actual trailer of the film has come out.”

Mr. Fox, the documentarian who made the Emmy-winning Gasland in 2010, and whose new movie Gasland Part II is now making its world premiere at Tribeca, has already withstood an aggressive P.R. campaign the likes of which few journalists and film-makers have ever experienced. The man who forever linked fracking to flaming tap water in the public mind has found himself, once again, in the oil and gas industry’s doghouse.

With funding from an array of oil companies, front groups like Energy in Depth have created entire websites devoted to “debunking” the first-hand reports shown in the first Gasland, produced their own film titled Truthland, and maneuvered behind the scenes to undermine Gasland’s credibility amongst the media.

Now the oil industry is gearing up for a new campaign to attack the sequel. And early signs indicate they plan to pull out all the stops.

More Financial Worries Coming to Light in Domestic Shale Drilling Industry

Virtually anyone who has followed the onshore drilling bonanza knows the name Aubrey McClendon and the company he co-founded, Chesapeake Energy.

McClendon was the hard-driving CEO and chairman of one of America’s most aggressive drilling companies, but he was brought down earlier this year after a string of financial scandals and potential conflicts of interest came to light. It turned out that at the heart of the natural gas industry’s poster child lay financial practices that drew the ire of investors, the attention of SEC investigators and the fixation of the news media.

But in the past several months there have been a series of largely under-reported events that demonstrate that Mr. McClendon's problems are by no means distinct.

Might the drilling industry have broader financial issues?

Obama's Energy Strategy -- Too Little, Too Late?

A year ago, President Obama set forth his vision of America’s energy policy. “We need an energy strategy for the future,” he said in a message still prominently displayed on the White House website, “an all-of-the-above strategy for the 21st century that develops every source of American-made energy.”

During the presidential debates, he hammered repeatedly an “all of the above” theme, though he also surprised many by making a strong statement about the urgency of confronting climate change during his second term.

This week, President Obama once more talked about his “all the above” strategy as he announced that he was setting aside $2 billion for research and development on alternative transportation fuels.

Things are looking up for renewable energy, right? Not so fast.

Obama's choice for new directors of the three agencies with the most relevance to climate change – the Environmental Protection Agency, the Department of Energy and the Department of the Interior — do not sew confidence that real change is coming.

Pennsylvania Failing to Sanction Drillers for Fracked Well Failures

For the past several years, the shale gas industry has argued that oversight of fracking is getting tighter and that the amount of methane gas leaking from their wells is less than some have speculated.

In Pennsylvania, however, the opposite is true, according to a white paper delivered to New York state regulators by Cornell engineering professor, Anthony Ingraffea. Inspection data from the state indicate that over 150 Marcellus shale wells in Pennsylvania had severe flaws that have led to sometimes large leaks and yet the operators of those wells were never issued violations by regulators for these breaches of state law.
 
By failing to cite drillers when things go wrong, Pennsylvania environmental regulators have for the past three years obscured the rate at which Marcellus wells leak, creating a falsely optimistic picture. Leaks at dozens of wells were described by state inspectors in their report notes, but violations were never issued.

Shale Industry Moves to Ship Fracking Waste via Barge, Threatening Drinking Water Supplies

A large barge passes Pittsburgh. Image from Shutterstock.

It was meant to go unnoticed. A small announcement out of a commissioners’ meeting signaled plans to transport fracking wastewater by barge down the Ohio River. But it caught the eye of locals and offers a further reminder of why handling and disposal of the wastewater is truly one of the shale drilling industry’s most important and overlooked concerns.
 
Construction is already completed at one barging facility in the Marcellus region. A Texas-based company, GreenHunter Water, has built a shipping terminal and 70,000-barrel wastewater storage facility on the Ohio River in New Matamoras, Ohio. GreenHunter officials have said they are currently accepting about 3,000 barrels of fracking wastewater per day.

The U.S. Coast Guard is now reviewing plans to barge fracking wastewater in the region’s rivers, which serve as the drinking water supplies for over half a million people.  
 
These plans have raised alarm for many reasons. In the event of a barge accident, the drinking water for major cities like Pittsburgh could be immediately contaminated; the barges themselves could become radioactive because Marcellus shale wastewater carries unusually high levels of radium; spills or illegal dumping could be harder to detect in water than on land.

Shale Gas Uncertainty: How an Industry Talking Point Misses the Mark

When oil and gas executives gathered in Pittsburgh, Pennsylvania to discuss the state of the industry shortly after Obama won re-election, they raised a recurring complaint.

“We now face four more years of regulatory uncertainty,” said Randy Alpert, an official with Consol energy told gathered shale gas executives.

Penny Seipel, Vice President of the Ohio Oil and Gas Association hit a similar note the very next day.

“Unfortunately, we have had quite a bit of uncertainty regarding our fiscal situation,” she said as she described proposed regulation and taxation of drilling companies in her state.

This uncertainty mantra has been trotted out by many industries facing potential oversight and is now being picked up by oil and gas: “We are not against regulation, we are against regulatory uncertainty,” the line goes. “We don’t care what the rules are,” companies say, “just tell us ahead of time and then we will follow them gladly.”

This well-worn trope gives the impression that drillers do not view regulators as adversaries. All they’re asking for is common-sense fairness. Who could be against someone asking to know what the rules are? Predictability is a reasonable request.

It's a shrewd position for the shale industry. But it’s also deeply misleading and worth flagging now since it is likely to get amplified in coming months as more attention turns to whether federal officials should step up their oversight of oil and gas drilling.

Oil and Gas Industry Set to Attack Matt Damon's "Promised Land"

Next month Focus Features releases Matt Damon’s new movie and the oil and gas industry is worried sick about it.

The movie, Promised Land, is about a Pennsylvania farm town deciding whether to go forward with shale gas drilling after a team of landmen arrives in the area.

Damon plays one of these landman, who rolls into town presenting himself as a humble flannel-wearing farmboy from Iowa. Damon’s character is an ace salesman, famously good at convincing homeowners to sign away the rights to their land. But halfway through the story, he starts having ethical pangs about his profession. Damon’s internal conflicts grow deeper as he grows closer to locals.

By Hollywood standards, it’s a small film, with a budget of $15 million. The script was written by Damon and co-star John Krasinski (best known for his role as Jim in “The Office”) and is based on a story by Dave Eggers.

The drilling industry is none too pleased about the movie’s at-times unflattering portrayal of landmen and it has already geared up its attack machine to aggressively respond.

The irony here, of course, is that the industry’s plan for taking on the movie runs parallel at times to the movie itself.  It a case where art imitates life imitates art.

I will come back to this.  But first, meet Mike Knapp.

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