Yes, wind farm opponents DO have gas leases

A couple of months ago, I called out Meredith Baxter Birney, I mean Meredith Lawrence, of the Dallas Observer for writing a piece about a proposed new wind farm in Cooke County, a piece that had a high ignorance level, IMO. I followed up a month later with a second article touching on tangental and additional issues.

I had speculated at the time that part of the issue was that some opponents have natural-gas leases and are afraid yet another wind farm (there's two in the Muenster portion of the area already) would further drive down the lease money they get. (Southwest Cooke County and southeast Montague County, the Saint Jo area, are the northern end of the Barnett Shale.)

Well, multiple things have added to that.

Following up on an addition I had to that original piece, for the next two months since October, Comptroller Glenn Hegar has shows production taxes from natural gas continue to fall. That means prices are down in general. Plus, production in Cooke County's been off slightly since last spring.

And, there's more.

One independent driller would like to see the RRC do its job on natural gas flaring, with the hope that would slow drilling enough on oil to prop the price up more, and also help natural gas prices. That said, if the indy gets his wish, MORE natural gas from the Permian means gas prices elsewhere (as in the Barnett Shale) go even deeper in the terlet. Per page 4 of the Dallas Fed's quarterly report, spot prices for gas aren't expected to get much better next year. (Neither is oil.) That said, one commenter on page 7 says that much of this is one-time flaring and that more Permian gas WILL come onstream later this year. At the Houston Chronicle, though focused more on oil, Chris Tomlinson had a recent business column about this same issue. He said a "mini-slump" is probably the best that producers should hope for this year. He notes the Permian is overproducing, that many CEOs are being paid for wells drilled and so have financial incentives to overproduce, and more.

In addition, as of earlier this month, for four months in a row, Comptroller Glenn Hegar's office reported that year-over-year monthly natural gas production taxes were down in the range of 30 percent.

So, the fears are there.

And, I have confirmed that at least one of the more vocal Muenster-area opponents does have gas leases, and at a substantial level.

As I said before, it's all about whose ox is being gored.

That said, other opponents, like Jared Groce, may be right on the land value issue.

EDP claims that the wind farms actually can boost land value. Well, sure, if you're taking in the value of the turbines, even though they're owned by EDP. But, at the same time, it may indeed depress the value on some other parcels in the area, while leaving yet others basically unchanged, with the result that overall value is actually up slightly.

But? That's capitalism, ain't it? And, as for tax breaks for wind turbines? What about the tax breaks for oil, and for the gas that's in the terlet?

So, my guess is that, like Caesar's Gaul, opposition is divided into three parts: one-third gas leaseholders, one-third a mix of developers and the people buying country sprawl from them, and one-third actual farmers and ranchers. Each has its own kind and degree of hypocrisy and fatted calves cum gored oxen.

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As for Ms. Lawrence, a new piece of hers where she talks about renewables passing coal in Texas energy production does give a small bit of indication that she now knows a small bit about natural gas. Next, perhaps you can talk about how Texas' tax laws and other issues are anti-solar, especially anti-rooftop solar, even as you tout solar's growth.

Texas GOP? #Fracking bubble more reason to stop depleting Rainy Day Fund

The Texas Republican Party, rather than being responsible, and actually paying for general budget items out of the general budget, seems to be getting ever more fond of having voters make the tough choices for them by passing constitutional amendments to pay for necessary water supply improvements (Proposition 6, last year) and transportation upgrades (Proposition 1, this year). Unfortunately, for the second straight year, voters were suckers at the polls.

Not only is this an abdication of GOP responsibility, it may not be sustainable.

Those of us who know a bit about fracking, not just its environmental concerns but the difference between actual reserves and rate of extraction of reserves, have known for some time that natural gas fracking's claims of an explosion of new resources have been somewhat bubbly. And, the latest confirmation of that is here.

Now, the evidence that the same is true of fracked shale oil is continuing to increase.

(N)oted Canadian energy analyst David Hughes says that even if the drilling could somehow continue, the bounty simply will not last. 

Last month, Hughes released “Drilling Deeper,” a report he authored for Santa Rosa-based Post Carbon Institute, scrutinizing the U.S.’s two largest oil booms in the Bakken and Eagle Ford fields. By examining industry data, Hughes projects that the booms in both fields will peak before 2020 and, by 2040, will be producing at a tiny fraction of their current levels. “[If] the future of U.S. oil and natural gas production depends on resources in the country's deep shale deposits, as the Energy Department contends, we are in for a big disappointment in the longer term," Hughes said in a press release. 

The fundamental problem, Hughes explains, is the ephemeral nature of the average deep shale oil well, which declines in production by 83 percent after three years. This, Hughes explains, translates to an annual decline rate in the Bakken and Eagle Ford fields of over 40 percent. (The Bakken and Eagle Ford, he says, are not unique in this regard. All shale oil plays are afflicted with steep decline curves.)

In other words, the Texas GOP, as incorporated in the Texas Legislature passing these constitutional amendments, is officially running a Ponzi scheme. (All emphasis in the above quote is mine.) 

And, it's a Ponzi scheme based not only on ephemeral production, but also ephemeral production that's not's being adequately taxed for all of its destructiveness.

Click the links within that pull quote, as well as clicking the main link for more. It should open your eyes. For example, Hughes expects Eagle Ford oil production to peak in 2016! That's from his "Drilling Deeper" report. And, it needs to open the eyes of people at larger media companies than me. The latest installment of the alleged Texas miracle of economics simply doesn't appear to be sustainable.

And, in a related issue, feel free to vote on my poll about Obama and the Keystone XL, at top right. (Note: The plunge in oil prices may also affect Obama's decision.)

Meanwhile, on both oil and gas, it seems like the Energy Information Administration become less trustworthy all the time.

Update, Jan. 16, 2015: Houston Chronicle columnist Chris Tomlinson notes that more recently fracked wells give some signs of not declining so quickly. That said, Hughes' graphs, linked above, do not show a sharp decline for either the Eagle Ford or the Bakken formations, among others, so I don't think Chris' note really undercuts Hughes' analysis.

Shale gas - giant Ponzi scheme

The idea that the fracking-driven shale-based natural gas boom might be a giant Ponzi scheme surprises me not a bit. Having previously lived at the edge of the Barnett Shale in Dallas-Fort Worth, I have some degree of knowledge about exploration costs for shale gas, so I know it's often a marginal venture on dollars-and-cents right now, at least.


And, this is NOT the answer:

Federal and state lawmakers are considering drastically increasing subsidies for the natural gas business in the hope that it will provide low-cost energy for decades to come.

Yes, its cleaner, in terms of emissions, than coal. But, so are wind and solar, so let's give them more subsidies instead. They're cleaner than natural gas. And in the case of solar, at least, it's not that far from high population densities in the Desert Southwest and Texas.


And, there's the hypocrisy of hard-right Republicans in red states wanting to subsidize gas fracking in Wyoming and Texas, too.


And, that's not the only problem. Production estimates in many fields may have been overstated. That definitely appears true for the Barnett.


Then, there's the environmental issues. If most fields have a quick peak then quickly drop after that, there's a lot of "sunk" longer-term environmental costs for short-term gain, not even counting possible migration of fracking fluids.

Cleburne (Texas) folks offered quake insurance

Big natural gas companies like Chesapeake continue to deny that their drilling causes earthquakes in North Texas’ Barnett Shale, but insurance companies are ready to help concerned homeowners in Cleburne.

Gas well fracking causing TX earthquakes?

Recently, a number of minor earthquakes have been reported in Texas’ natural-gas laden Barnett Shale, centered in the area around Cleburne, south-southwest of Fort Worth. Now, with four earthquakes, all minor and below magnitude 3.0, hitting in less than a month, some people wonder if well fracturing isn’t the culprit.

Such work, known as fracking, involves shooting water supersaturated with a propriety type of sand, into a wellhead to widen it and to create cracks in the surrounding rock to get gas or oil to flow to the wellhead.

Chesapeake Energy, the main driller in the area, says it wants to get at the bottom of the issue, while, in the same breath, denies it’s the cause:

“Drilling has occurred for more than a hundred years,” Julie Wilson said in an e-mail. “Tens of thousands of wells have been drilled with no nearby earthquakes at all; hundreds of earthquakes have occurred with no drilling nearby.”

Per John Breyer, a petroleum geologist and professor at Texas Christian University, I agree; I doubt fracking is the cause.

But, how can you know for sure without checking, and, how can you check completely enough to “get at the bottom of the issue” if you’re already ruling yourself out as the cause in advance?

Beyond that, such a thorough check might also have other benefits.