Interesting Stats from EIA on the Proliferation of Horizontal Drilling

“In 2015 nearly 77% of the most prolific U.S. oil wells, or those producing more than 400 barrels of oil equivalent (BOE) per day, were horizontally drilled wells. For about 85,000 moderate rate wells producing in 2015, defined here as more than 15 BOE per day and up to 400 BOE per day, 42% were drilled horizontally. Of the approximately 370,000 lowest-rate, marginal oil wells in 2015, also known as stripper wells, only about 2% were horizontal wells.”—EIA


An Interesting Perspective from EIA for Fans of Baseball, History, and Domestic Energy

“On Tuesday, the Cleveland Indians are set to host the Chicago Cubs in game six of the 2016 Major League Baseball World Series. In the 68 years since the last title for the Cleveland Indians, and the 108 years since the last World Series title for the Chicago Cubs, energy production and consumption patterns in the United States have changed a great deal…In 1908, the last time the Cubs won the World Series, the United States produced less than half a million barrels per day (b/d) of oil, with crude oil production having only started approximately 50 years earlier. At that time, crude oil was mainly refined to produce kerosene for use in lamps. The first Ford Model T automobile was produced in 1908, kicking off a shift in demand for petroleum products from kerosene for lamps to gasoline for automobiles….The last time the Cleveland Indians won the World Series, in 1948, the United States produced 5.5 million b/d of crude oil. Crude oil production had been steadily increasing since declines in the 1930s and would continue to increase until production declines in the 1970s.”—EIA


Source: U.S. Energy Information Administration, Petroleum Supply Monthly


Source: U.S. Energy Information Administration, Monthly Energy Review

Congressional Energy Roundup (Week of October 3, 2016)

Fracking Insider Readers: Below, please find this week’s Congressional activity on oil and gas issues:


“Examining the Local Impacts of EPA’s Climate Regulations.” Committee on Environment and Public Works, Subcommittee on Clean Air and Nuclear Safety. October 5, 2016. 1:00 PM EST.


“Tribal Prosperity and Self-Determination through Energy Development.” Committee on Natural Resources. October 4, 2016. 10:00 AM MST.

Please note: Both of the hearings are field hearings, and will not occur in Washington, DC. The House Natural Resources hearing’s start time is Mountain Standard Time, which is two hours behind Eastern Standard Time. Therefore the hearing starts at noon on the east coast.

Congressional Energy Roundup (Week of September 19, 2016)

Fracking Insider Readers: Below, please find this week’s Congressional activity on oil and gas issues:


“Impacts of the Obama Council on Environmental Quality Final Guidance for GHG Emissions and the Effects of Climate Change.” Committee on Natural Resources. September 21, 2016. 10:00 AM EST.

“Examining Misconduct and Intimidation of Scientists by Senior DOE Officials.” Committee on Science, Space, and Technology, Subcommittee on Energy, Subcommittee on Oversight. September 21, 2016. 10:00 AM EST.

“The Status of the Federal Government’s Management of Wolves.” Committee on Natural Resources, Subcommittee on Oversight and Investigations. September 21, 2016. 2:00 PM EST.

“Midterm Review and Update on the Corporate Average Fuel Economy Program and Greenhouse Gas Emissions Standards for Motor Vehicles.” Committee on Energy and Commerce, Subcommittee on Energy and Power. September 22, 2016. 10:00 AM EST.

Congressional Energy Roundup (Week of September 12, 2016)

Fracking Insider Readers: Below, please find this week’s Congressional activity on oil and gas issues:


“H.R. 5780, the Utah Public Lands Initiative Act.” Committee on Natural Resources, Subcommittee on Federal Lands. September 14, 2016. 10:00 AM EST.

“A Solution in Search of a Problem: EPA’s Methane Regulations.” Committee on Science, Space, and Technology, Subcommittee on Environment. September 15, 2016. 9:30 AM EST.

“A Review of Recently Completed United States Army Corps of Engineers Chief’s Reports.” Committee on Transportation and Infrastructure, Subcommittee on Water Resources and Environment. September 15, 2016. 9:30 AM EST.

“The Department of Energy’s Role in Advancing National, Economic, and Energy Security of the United States.” Committee on Energy and Commerce, Subcommittee on Energy and Power. September 15, 2016. 10:00 AM EST.

Congressional Energy Roundup (Week of September 6, 2016)

Fracking Insider Readers: Below, please find this week’s Congressional activity on oil and gas issues:


“Eastern Mediterranean Energy: Challenges and Opportunities for U.S. Regional Priorities.” Committee on Foreign Affairs, Subcommittee on the Middle East and North Africa. Committee on Science, Space and Technology, Subcommittee on Energy. September 8, 2016. 2:00 PM EST.

“Asia’s Growing Hunger for Energy: U.S. Policy and Supply Opportunities.” Committee on Foreign Affairs, Subcommittee on Asia and the Pacific. September 8, 2016. 3:00 PM EST.

UPDATE: Extreme Anti-Fracking Measures Fail to Make Ballot in Colorado

Two anti-fracking ballot initiatives that were pushed by a group calling itself “Coloradans Resisting Extreme Energy Development” have failed to make the November ballot, the only two initiatives that failed to qualify of the nine initiatives submitted to the Secretary of State for certification. The Secretary of State’s office said that, in a random sample of signatures submitted for the initiatives, it found several potentially forged signature lines. It sent the questionable signatures to the state attorney general’s office for further inquiry. Initiative 75 would have enabled localities to ban fracking, and Initiative 78 would have increased the setback requirement for new wells. (See our previous coverage of Initiative 78 here.)

ESA Mega-Settlement Part II: CBD Files Notice of Intent to Sue Over 417 Species

The Center for Biological Diversity (“CBD”) filed on August 23, 2016 a Notice of Intent to sue the U.S. Fish & Wildlife Service (“FWS” or “the Service”) over missed Endangered Species Act (“ESA”) 12-month finding deadlines for 417 species found across the nation, three-quarters of which are found in the southeastern United States. The upcoming lawsuit is part of a larger trend where groups purposely flood FWS with listing petitions, sue when the Service cannot meet the impossibly strict statutory response deadlines, settle on terms the groups dictate, and then collect generous legal fees.  If past is prologue, this Notice of Intent is the first step in litigation that will likely determine FWS’s species listing agenda for the next several years.

Here’s how it works: The ESA is structured such that simply filing a petition to list a species subjects the Service to an inflexible deadline wherein, within 12 months, the Service must determine whether the petitioned listing is: (1) warranted; (2) not warranted; or (3) warranted but precluded by other higher priorities.

If the Service does not meet the 12-month deadline, the petitioning group brings a suit in federal district court to enforce the deadline and to collect legal fees. Because these suits seek to enforce unambiguous language, (i.e., 12 months means 12 months), these cases are incredibly easy for the litigants (principally CBD and WildEarth Guardians (“WEG”)) to win.  And because FWS and its attorneys at the Department of Justice know that these cases are incredibly hard to defend, FWS is quick to settle with the litigants.

At the settlement table, the litigants negotiate the generous legal fees that are available under the ESA, and they dictate to FWS the precise order and timeline under which FWS will be required to list the petitioned species. The listing order and timeline dictated by the litigants is driven, not by conservation science or the species’ relative proximity to extinction, but by the petitioners’ policy goals, be they anti-development, anti-hydrocarbon, anti-farming, anti-recreation, anti-access, etc.

Unfortunately, this well-worn (and presumably profitable) strategy is incredibly easy for CBD and WEG to implement. The legal action is relatively simple and the Service’s settlement position is inevitable.  All that CBD and WEG need to do is make sure that FWS misses the deadlines.  And do you ensure that the Service misses the deadlines for responding to petitions?  File more petitions.  And file more petitions covering lots and lots of species.  FWS has limited resources but there is no limit to the number of species, subspecies, and distinct population segments that can be thrown into a petition.  As long as CBD and WEG petition to list enough species to overwhelm FWS, their legal challenge and legal fees are all but assured.  Think I’m wrong about that?   WEG once filed a petition (and started a 12-month clock) on a petition to list 475 species.  CBD once petitioned to list 404 species (many at issue here).  Those really happened.

And why would CBD file a single 60-day notice of intent to sue for 417 species found in petitions filed over 8 years? Well, the 60-day period is designed to give FWS an opportunity to cure its alleged violation.  Perhaps FWS could, within 60 days, remedy its failure to make 12-month findings for a handful of the most imperiled species—but there is no way FWS can make 417 12-month findings.

How do we know this?  CBD and WEG used this exact same strategy a few years ago, and, in May 2011, FWS entered into a “mega-settlement” with CBD and WEG under which FWS agreed to make listing decisions for hundreds of species between 2011 and 2017 in order to settle more than 85 different lawsuits filed by the CBD and WEG over the course of just a few years. Every one of those lawsuits was based on the Service’s inability to timely reach 12-month findings and every one of those failures was based on the incredible number of petitions CBD and WEG pushed at the Service until it could not keep up.

The settlement discussions were conducted behind closed doors with no opportunity for comment, input, or engagement. As a result, CBD and WEG got exactly what they wanted—aggressive listing deadlines and a strict limitation on the Service’s ability take a rational and prioritized approach to listing decisions by using “warranted but precluded” designations.

The ESA has not been amended to give FWS more flexibility and CBD has not stopped profiting from the ESA’s inflexibility. This playbook helped CBD win in 2011 and is poised to do so again today.  This begs the question—Who loses?

  1. FWS – The Service no longer controls its listing agenda, cannot prioritize the most at-risk species, cannot make resource-based decisions, and has been forced to shift resources from the field to desks.  And then they have to use their limited funds to pay their opponents’ lawyers.
  2. Landowners and Land Use Industries – The ESA is being used to pursue policy goals that have nothing to do with conservation.  CBD’s policy goals are decidedly anti-development, anti-hydrocarbon, and land use, and even anti-people. Those industries are often forced to navigate the ESA’s strict protections for species listed pursuant to CBD’s campaign for which the threat of extinction is far from proximate.  Again, this is about policy, not protection.
  3. States – The inevitable expansion of species listed on the ESA forces States to navigate the same types of protections as landowners (because they are landowners), but it also encroaches on States’ ability to manage species within their borders.  Because States often have the most direct knowledge of these species and their habitat, this is a harm to States and conservation alike.
  4. Real Conservationists – Intentionally breaking the ESA’s petitioning mechanisms and using the statute to pursue policy goals (and legal fees) does not further conservation.  And in fact, manipulating the system to force FWS to devote its resources to fending off petitions and deadline litigation hurts conservation.  FWS has lost all ability to prioritize at-risk species and sacrificed boot-on-the-ground conservation for paperwork management.  The simple act of listing species does not conserve them. Recovery planning and implementation are the only things that truly help conserve species.  And less than half of listed species have recovery plans precisely because CBD has condemned FWS to shoveling against the endless tide of new petitions.  This 60-day notice letter, and the litigation that will soon follow, have everything to do with policy manipulation and nothing to do with conservation.  In fact, they undermine conservation.

We will continue to keep you updated on developments in this case.

Hydraulic Fracturing: State Regulatory Roundup Vol. 48

Fracking Insider Readers: We are pleased to bring you Volume 48 of our State Regulatory Roundup, including updates in California, Colorado, and Kansas. As we explained in earlier volumes, we designed the Roundup to provide quick overviews on state regulatory activity. If you have any questions on any of these summaries, please do not hesitate to ask. Continue Reading

Shocker from EIA – Lifting the Crude Export Ban Results in More Crude Exports

“Since the removal of restrictions on exporting U.S. crude oil in December 2015, the number of countries receiving exported U.S. crude has risen sharply. These exports have occurred despite a sustained narrow price premium of international crude oil prices over U.S. domestic crude oil prices, the many costs associated with arranging cargoes for export, and falling U.S. crude production…In the first five months of 2016, U.S. crude oil exports averaged 501,000 barrels per day (b/d), 43,000 b/d (9%) more than the full-year 2015 average.” –Energy Information Administration